Risk of business performance fluctuations due to public investment, housing starts, personal consumption and climate

「During the cumulative first quarter of the consolidated fiscal year, material prices and transportation costs continued to rise, further weakening consumers’ willingness to purchase homes.」

「Material prices and transportation costs continued to rise. In addition, uncertainty surrounding the situation in the Middle East further weakened consumers’ willingness to purchase homes during the fiscal year. Under these conditions, we strengthened sales efforts focused on existing customers and worked to reduce expenses, but the substantial decline in sales, particularly in Hokkaido and Tohoku, had a significant impact, and both sales and operating profit were below the previous fiscal year.」

「Housing prices continued to rise nationwide due to soaring material prices and other factors, with no improvement in consumers' willingness to purchase homes. Housing starts remained sluggish, particularly in the Tohoku region and areas farther north, the Group's primary market. As a result, both net sales and operating income fell below the year-earlier period.」

「Housing starts nationwide were on a declining trend due to soaring material prices, causing net sales to fall below the previous fiscal year. Although the Group worked to reduce selling, general and administrative expenses, profit also fell below the previous fiscal year due to higher transportation costs and the impact of rising prices.」

「Timber demand declined due to decreases in housing starts and capital investment, causing net sales to fall below the previous fiscal year. In terms of profit, gross profit declined along with net sales, and operating income fell below the previous fiscal year.」

「Although foot traffic recovered as restrictions related to COVID-19 were eased, consumer sentiment continued to weaken due to rising prices. In terms of net sales, sales of snow-removal supplies, cold-weather clothing and other products declined in the home improvement business due to the warm winter.」

「Although foot traffic recovered as restrictions related to COVID-19 were eased, the decline in consumer sentiment caused by rising prices remained pronounced, and conditions remained challenging throughout the cumulative second quarter of the current consolidated fiscal year.」

「Net sales fell below the year-earlier period as timber demand declined due in part to a decrease in housing starts.」

「Consumer sentiment continued to weaken amid rising prices driven by Russia's invasion of Ukraine and yen depreciation resulting from the Japan-U.S. interest-rate differential, causing net sales and operating income to fall below the year-earlier period.」

「Although sales of some products remained strong due to an increase in events and leisure activities following the lifting of restrictions on activities, net sales and operating income fell below the year-earlier period as consumer sentiment showed signs of weakening amid the rapid resurgence of infections from the Omicron variant of COVID-19, global price increases following Russia's invasion of Ukraine and yen depreciation resulting from the Japan-U.S. interest-rate differential.」

「During the current consolidated fiscal year, the Japanese economy remained in a challenging situation, as the renewed spread of COVID-19 prolonged its impact on social and economic activity and weakened consumer sentiment amid rising prices.」

「During the cumulative third quarter of the current consolidated fiscal year, from 1 June 2021 to 28 February 2022, the spread of COVID-19 in Japan had temporarily declined with the wider availability of vaccines and other factors. However, the situation remained uncertain, as the renewed spread of infections from January led to the implementation of priority preventive measures to curb the spread of disease.」

「The Group operated in a challenging business environment. In the home improvement division of the distribution business, sales of products related to COVID-19 infection prevention declined from the previous year. In the timber business, plywood imports had not returned to normal due to the global container shortage. In the automobile-related business, delays in the timing of new-vehicle deliveries and supply constraints continued due to the global semiconductor shortage.」

「During the cumulative third quarter of the current consolidated fiscal year, the Japanese economy remained in an extremely challenging situation, as restrictions on economic activity resulting from the spread of COVID-19 caused corporate earnings to deteriorate and personal consumption to decline.」

「During the cumulative second quarter of the current consolidated fiscal year, the Japanese economy remained in an extremely challenging situation, as the global spread of COVID-19 caused corporate earnings to deteriorate and personal consumption to decline.」

「In the automobile-related business, one of the Group's core businesses, the number of new vehicles sold declined due to weaker consumer sentiment resulting from concerns about the outlook for the economic environment and other factors.」

「Net sales fell below the year-earlier period due in part to the impact of record warm winter weather on seasonal products and the post-increase pullback following the consumption tax increase.」

「During the cumulative second quarter of the current consolidated fiscal year, the Japanese economy remained on a gradual recovery track against a backdrop of improving corporate earnings and employment conditions. However, the outlook remained uncertain, amid concerns about the impact of the consumption tax increase on personal consumption and other areas, as well as the effects of the prolonged U.S.-China trade dispute on the global economy.」

「Net sales fell below the year-earlier period due in part to the impact of unfavorable weather on seasonal products and the continued sluggishness of personal consumption.」

「Net sales fell below the year-earlier period due in part to a decline in orders for the Group's core flooring installation business.」

「In both the home improvement and department store divisions, changes in the business environment, including increasingly intense competition across industry boundaries and the growth of e-commerce, became more pronounced, while consumers' inclination to economize and weather conditions had various effects on business activity, causing net sales to fall below the year-earlier period.」

「Net sales fell below the year-earlier period due in part to a decline in customer traffic caused by unfavorable weather and intensifying competition with other companies in the same industry.」

「The business environment was extremely challenging, due not only to external factors such as unfavorable weather, declining public works and the suspension of automobile sales, but also to internal issues, including insufficient ability to respond to intensifying competition.」

「In the timber business, the number of flooring installation orders declined as public works decreased, causing net sales to fall below the year-earlier period. In terms of profit, margins remained low because the Group was slow to pass higher costs, including increases in raw material prices, through to selling prices. In the distribution business, the Group worked to strengthen sales, including the opening of the Yellow Globe Eniwa store in Eniwa, Hokkaido, by 株式会社テーオーリテイリング in June 2017. However, due in part to weak consumer sentiment toward durable goods, both net sales and operating income fell below the year-earlier period.」

「In the distribution business, the Group worked to strengthen sales, including the opening of the Yellow Globe Eniwa store in Eniwa, Hokkaido, by 株式会社テーオーリテイリング in June 2017. However, due in part to weak consumer sentiment toward durable goods, both net sales and operating income fell below the year-earlier period.」

「In the distribution business, テーオーリティリング opened イエローグローブ恵庭店 in Eniwa, Hokkaido, in June 2017 and worked to strengthen its sales capabilities. However, profit margins remained low because consumer sentiment toward durable consumer goods remained weak.」

「In the timber business, revenue fell below the previous year because, among other factors, the number of orders for flooring work decreased due to a decline in public works. In the distribution business, the company worked to strengthen its sales capabilities by opening new stores, including イエローグローブ斜里店 in Shari, Hokkaido, and ドコモショップ函館本通店 in Hakodate, Hokkaido, but revenue fell below the previous year because consumer sentiment toward durable consumer goods remained weak.」

「In the timber business, revenue and operating income fell below the previous year because, among other factors, the number of orders for flooring work decreased due to a decline in public works. In the distribution business, the company worked to strengthen its sales capabilities by opening new stores, including イエローグローブ斜里店 in Shari, Hokkaido, and ドコモショップ函館本通店 in Hakodate, Hokkaido, but revenue and operating income fell below the previous year because consumer sentiment toward durable consumer goods remained weak.」

「In the timber business, revenue and operating income fell below the previous year because, among other factors, the number of orders for flooring work decreased due to a decline in public works. As a result, revenue was ¥5,042 million, down 10.1% year on year, and the operating loss was ¥54 million, compared with operating income of ¥48 million in the same period of the previous year.」

「In the timber business, sales of construction materials remained firm as housing starts increased, but revenue and operating income fell below the previous year because, among other factors, the number of orders for flooring work decreased due to a decline in public works.」

「The group’s revenue from timber, housing and construction may be materially affected by increases or decreases in public investment and the number of new housing starts. Revenue from distribution and automotive-related businesses may also be materially affected by climate conditions and consumption trends.」