Improving Profitability through Cost Management and Production Optimization

「The company seeks to improve profitability by reviewing its portfolio of unprofitable businesses and optimizing its global supply structure.」

「Manufacturing and sales for the automotive industry declined due to weak markets in North America and China, but profit increased as manufacturing costs fell following progress in reducing costs through the stabilization of raw material prices and the downsizing of unprofitable operations. Sales in this segment were ¥14,437 million, down 13.1% year on year, while operating profit was ¥1,068 million, up 93.6%.」

「Operating profit increased by ¥900 million from the previous consolidated fiscal year, as gross profit increased by ¥2,947 million and selling, general and administrative expenses increased by ¥2,047 million, reaching ¥4,555 million at an operating margin of 6.7%.」

「The management targets are a return on equity (ROE) of at least 7% and an operating margin of at least 10%. In the current consolidated fiscal year, sales increased by ¥5,918 million from the previous consolidated fiscal year to ¥49,979 million. However, operating profit was ¥2,684 million and the operating margin was 5.4%, reflecting the impact of a sharp reduction in automobile production caused by supply constraints, including the semiconductor shortage, and soaring raw material prices. ROE was 4.7% for the current consolidated fiscal year despite the purchase of treasury shares.」

「Sales of fine chemicals for the electronics industry and high-performance soundproofing materials for room air conditioners remained firm against a backdrop of increased stay-at-home demand. However, the Group as a whole was significantly affected by the spread of COVID-19, and sales declined sharply in the automotive and electrical and electronic components industries, its major customer markets, due to production stoppages, delays in launching new vehicles and other factors.」

「Operating profit declined by ¥519 million from the previous consolidated fiscal year to ¥3,421 million, as sales outside the industrial materials segment, where exports to Southeast Asia were strong, declined due to weak automotive-related sales and other factors, while selling, general and administrative expenses also increased because of higher storage and transportation costs.」

「Sales of general-purpose industrial chemicals and large-scale cleaning equipment for the domestic market remained firm, but earnings declined due to lower sales of high-value-added export-related products and higher raw material costs and expenses. Sales in this segment were ¥3,527 million, up 7.9% year on year, while operating profit was ¥178 million, down 31.7%.」

「Sales of general-purpose chemicals and large-scale cleaning equipment for the domestic market remained firm, but export-related sales of high-value-added products declined. Together with higher raw material costs and expenses, this resulted in lower profit. Sales in this segment were ¥1,738 million, up 3.5%, while operating profit was ¥76 million, down 49.6%.」

「Manufacturing and sales of general-purpose and specialty chemicals for the domestic market, as well as export-related sales, were generally firm, but profit declined due to higher raw material procurement prices and increased expenses. Sales in this segment were ¥6,783 million, up 5.0% year on year, and operating profit was ¥535 million, down 10.1% year on year.」

「Manufacturing and sales of general-purpose and specialty chemicals for the domestic market, as well as export-related sales, remained strong, and raw material costs and production efficiency also improved, but the result was higher revenue and lower profit. Sales in this segment were ¥5,150 million, an increase of ¥357 million, or 7.5%, from the same quarter of the previous year, while operating profit was ¥421 million, a decrease of ¥20 million, or 4.6%.」

「Manufacturing and sales of general-purpose and specialty chemicals for the domestic market, as well as export-related sales, remained strong. Together with improvements in raw material costs and production efficiency, this resulted in higher revenue and higher profit. Sales in this segment were ¥3,269 million, an increase of ¥218 million, or 7.2%, from the same quarter of the previous year, and operating profit was ¥260 million, an increase of ¥10 million, or 4.3%.」

「Profit also increased as a result of improvements in raw material costs and production efficiency. Sales in this segment were ¥1,679 million, an increase of ¥236 million, or 16.4%, from the same quarter of the previous year, and operating profit was ¥152 million, an increase of ¥44 million, or 41.2%.」

「Profit also increased as a result of improvements in raw material costs and production efficiency. Sales in this segment were ¥6,464 million, up 5.9% year on year, and operating profit was ¥596 million, up 29.3% year on year.」

「Profit also increased as a result of improvements in raw material costs and production efficiency. Sales in this segment were ¥4,793 million, up ¥236 million, or 11.1%, from the same quarter of the previous year, and operating profit was ¥441 million, up ¥44 million, or 41.0%.」

「Profit also increased as a result of improvements in raw material costs and production efficiency. Sales in this segment were ¥3,051 million, up 5.8% year on year, and operating profit was ¥250 million, up 32.6% year on year.」

「Profit also increased as a result of improvements in raw material costs and production efficiency. Sales in this segment were ¥1,442 million, up 5.7% year on year, and operating profit was ¥108 million, up 39.4% year on year.」

「Operating profit increased by ¥1,145 million from the previous fiscal year to ¥3,958 million, reflecting efforts to optimize the global structure through lower raw material prices and improved production efficiency.」

「In addition to the effects of the restructuring carried out in the previous fiscal year, we worked to improve profitability by reducing raw material and other costs. We also worked to reduce raw material costs and improve production efficiency.」

「In addition to the effects of the restructuring carried out in the previous fiscal year, we worked to improve profitability by reducing raw material costs. Although production and sales volumes increased across the business segments, the stronger yen resulted in lower revenue and higher profit. Sales in this segment were ¥7,408 million, down 3.3% year on year, and operating profit was ¥850 million, up 7.5% year on year.」

「Although production and sales volumes increased across the business segments as we worked to improve profitability by reducing raw material costs, the stronger yen resulted in lower revenue and higher profit. Sales in this segment were ¥3,684 million, down 1.7% year on year, and operating profit was ¥400 million, up 10.3% year on year.」

「In close coordination with group companies, we will pursue thorough cost management and production optimization, make effective and efficient use of limited management resources, and seek to improve profitability.」