Business Restructuring Focused on Profitability

「In the beverage manufacturing business, orders, particularly for alcoholic and soft drinks, remained firm, and profit recovered to a level substantially above that of the previous year. In the tea-leaf processing business, however, performance during the first six months of the fiscal year was sluggish because processing volume temporarily slowed due to fluctuations in domestic tea-leaf prices. The company also regards expanding sales of its own-brand products as its most important medium- to long-term priority. It is gradually increasing their contribution to results by actively developing new products and conducting promotional activities while strengthening its marketing and sales strategies. As a result, revenue from the beverage manufacturing business was ¥6,244 million, up 6.3% year on year, and segment profit was ¥900 million, up 46.9%.」

「For the fiscal year, sales were ¥25,409 million, up 6.0% year on year; operating profit was ¥1,071 million, up 40.0%; ordinary profit was ¥1,418 million, up 29.7%; and profit attributable to owners of the parent was ¥909 million, up 21.5%.」

「In the Vending-Machine Operations Retail Business, amid continued difficult conditions caused by successive price increases for manufacturers' products, lower sales volumes due to consumers' preference for saving, and higher costs associated with cashless payments, we continued efforts to improve profit margins, including improving installation conditions and removing unprofitable machines. With further price increases for manufacturers' products scheduled for October, we are focusing on establishing an earnings base capable of withstanding a decline in sales volume. As a result, sales in the Vending-Machine Operations Retail Business were ¥7,451 million, up 2.3% year on year, and segment profit was ¥209 million, up 6.7%, maintaining a trend of higher sales and profit.」

「In the vending-machine retail business, the company shifted its focus from pursuing the number of machines in operation and sales volume to improving productivity by operating base, vending machine and employee. It is also working to appropriately reflect product price revisions and optimize installation conditions. As a result, revenue from the vending-machine retail business was ¥7,283 million, up 3.4% year on year, while segment profit was ¥196 million, down 12.3%. As a result, revenue from the beverage manufacturing business was ¥5,417 million, up 10.9% year on year, while segment profit was ¥564 million, down 17.1%.」

「For the fiscal year, sales were ¥23,260 million, up 9.6% year on year; operating profit was ¥767 million, up 13.6%; ordinary profit was ¥1,038 million, up 12.0%; and profit attributable to owners of the parent was ¥768 million, up 27.6%.」

「For the first nine months of the fiscal year, revenue was ¥17,783 million, up 10.4% year on year, operating profit was ¥876 million, up 20.1%, ordinary profit was ¥1,067 million, up 11.4%, and quarterly net income attributable to owners of the parent was ¥827 million, up 31.5%.」

「In the vending-machine retail business, the company worked to improve profitability by raising productivity through operational reviews and optimizing selling prices in response to soaring production and logistics costs. As part of its M&A activities, it also acquired, among other assets, the operating rights for approximately 750 vending machines in the Tohoku region. As a result, revenue from the vending-machine retail business was ¥7,302 million, up 8.3% year on year, and segment profit was ¥217 million, up 136.4%.」

「In the vending-machine retail business, the company is moving swiftly to strengthen sales capabilities through the integration of 2 subsidiaries in October last year, optimize vending-machine selling prices and maximize the efficiency of administrative functions. It will also continue to carry out M&A, which is essential for improving the profitability of its nationwide operating bases. As a result, revenue from the vending-machine retail business was ¥3,346 million, up 5.3% year on year, and segment profit was ¥28 million, up 93.1%.」

「Against this backdrop, the entire vending-machine industry is entering a major turning point, and restructuring businesses with a focus on profitability has become an urgent priority not only for the company but for the industry as a whole to improve competitiveness and transform its industrial structure.」

「In the beverage manufacturing business, the company continued to receive strong orders and achieved revenue above the level of the same quarter of the previous year while reviewing manufacturing expenses in response to soaring electricity and gas prices. In particular, demand increased for pouch beverages popular in sports settings and bottled beverages served at restaurants as foot traffic recovered and outdoor activities increased, leading to higher orders. As a result, revenue from the beverage manufacturing business was ¥5,990 million, up 18.3% year on year, and segment profit was ¥804 million, up 6.2%.」

「As a result, revenue from the vending-machine retail business was ¥6,739 million, up 4.2% year on year, and segment profit was ¥91 million, up 410.8%. Revenue from the beverage manufacturing business was ¥4,204 million, up 18.6%, and segment profit was ¥692 million, up 1.5%.」

「In the beverage manufacturing business, OEM and ODM manufacturing achieved revenue above the level of the same quarter of the previous year, supported by the strong trust of brand manufacturers. However, profit fell below the year-earlier level because the company was unable to absorb soaring energy prices, including electricity. The company will continue to improve production efficiency while negotiating appropriate price revisions. As a result, revenue from the beverage manufacturing business was ¥2,155 million, up 15.4% year on year, and segment profit was ¥378 million, down 8.2%.」

「In the beverage manufacturing business, beverages for at-home consumption continued to diversify, particularly carbonated and low-alcohol beverages, while pouch products for sports and outdoor activities also showed signs of recovery. By steadily responding to contract manufacturing orders for these OEM and ODM products, performance remained firm. As a result, revenue from the beverage manufacturing business was ¥5,063 million, compared with ¥8,862 million in the same quarter of the previous year, and segment profit was ¥757 million, compared with ¥633 million.」

「In the Beverage Manufacturing Business, orders for carbonated and low-alcohol beverages remained strong, supported by at-home drinking demand resulting from the spread of COVID-19, and performance remained firm. The company also continued to thoroughly review manufacturing costs, including energy costs, to strengthen profitability. As a result, Beverage Manufacturing Business sales were ¥3.544 billion, compared with ¥6.116 billion in the same quarter of the previous year, and segment profit was ¥682 million, compared with ¥503 million.」

「In the beverage manufacturing business, despite unfavorable weather, including an early start to the rainy season, the company focused on producing carbonated and low-alcohol beverages in response to demand for at-home consumption, and performance remained firm. It also continued to thoroughly review manufacturing costs, including energy use, to strengthen profitability. As a result, revenue from the beverage manufacturing business was ¥1,867 million, compared with ¥3,040 million in the same quarter of the previous year, and segment profit was ¥412 million, compared with ¥283 million.」

「In the beverage manufacturing business, the company strengthened proposal-based sales tailored to brand owners' needs, focusing on canned chu-hai. As a result, revenue from the beverage manufacturing business was ¥8,862 million, up 13.9% from the same quarter of the previous year, and segment profit was ¥633 million, up 5.4%.」

「As a result, for the six months ended September 30, sales were ¥12,157 million, down 12.3% year on year; operating profit was ¥294 million, down 48.5%; ordinary profit was ¥381 million, down 34.4%; and quarterly profit attributable to owners of the parent was ¥229 million, down 38.8%.」

「The Group's sales and profits also declined significantly as a result of this impact. Accordingly, for the cumulative first quarter, net sales were ¥5,600 million, down 20.3% year on year; operating profit was ¥45 million, down 86.8%; ordinary profit was ¥55 million, down 82.9%; and net profit attributable to owners of the parent was ¥10 million, down 94.7%.」

「Revenue declined significantly year on year due mainly to the suspension of the retort line at the Utsunomiya Beverage Plant in March 2019 and the impact on OEM production of RTD (low-alcohol beverages) caused by unfavorable summer weather. Against this backdrop, the company sought to recover by actively proposing beverage manufacturing services other than RTD, while soft-pouch beverage manufacturing, now in its second year, secured orders well above plan. As a result, segment profit exceeded the year-earlier level.」

「Although revenue was below the prior year, partly due to unfavorable weather, strategic revisions to the production structure and growth in soft-pouch beverages in their second year contributed to higher profit across the business. As a result, revenue in the beverage manufacturing business was ¥5,706 million, down 8.9% year on year, while segment profit was ¥555 million, up 20.9%.」

「Through the medium-term management strategies of transforming the business structure to create demand and improve profitability, and transforming and developing services and business models, our group aims to establish a competitive advantage and become a corporate group that earns the trust and support of all stakeholders. In the beverage manufacturing business, we strengthened production of soft-pouch beverages targeting the healthcare field to further expand the beverage business. As a result, for the 3-month period ended 30 June, revenue was ¥7,030 million, down 2.2% year on year, operating profit was ¥341 million, up 62.7%, ordinary profit was ¥325 million, up 64.2%, and profit attributable to owners of the parent was ¥200 million, up 37.6%.」

「As a result, for the fiscal year, revenue was ¥27,976 million, up 2.0% year on year, operating profit was ¥670 million, up 20.5%, ordinary profit was ¥723 million, up 16.4%, and profit attributable to owners of the parent was ¥501 million, up 30.7%.」

「In the beverage manufacturing business, we began producing soft-pouch beverages and conducted research and development to further expand the beverage business, targeting the healthcare field. As a result, for the 9-month period ended 31 December, revenue was ¥21,647 million, up 1.6% year on year, operating profit was ¥587 million, down 2.6%, ordinary profit was ¥634 million, down 5.9%, and profit attributable to owners of the parent was ¥449 million, up 5.9%. Revenue in the beverage manufacturing business was ¥9,326 million, up 11.5% year on year, and segment profit was ¥560 million, up 7.3%.」

「In the beverage manufacturing business, we began producing soft-pouch beverages and conducted research and development to further expand the beverage business, targeting the healthcare field. As a result, for the 6-month period ended 30 September, revenue was ¥14,706 million, down 1.4% year on year, operating profit was ¥506 million, up 0.6%, ordinary profit was ¥527 million, up 5.7%, and profit attributable to owners of the parent was ¥374 million, up 27.7%.」

「Our group has promoted selective focus on the beverage manufacturing retail business (SPA), which provides products and services that respond to social change, in order to enhance the company's raison d'être, while working to transform its business structure with an emphasis on profitability. In the beverage manufacturing business, we also installed a new production line for soft-pouch beverages to further expand the beverage business. As a result, for the 3-month period ended 30 June, revenue was ¥7,189 million, down 1.5% year on year, operating profit was ¥210 million, down 20.8%, ordinary profit was ¥198 million, down 18.7%, and profit attributable to owners of the parent was ¥145 million, up 4.7%.」

「Our group has promoted selective focus on the beverage manufacturing retail business (SPA), which provides products and services that satisfy customers, in order to enhance the company's raison d'être, while working to transform its business structure with an emphasis on profitability. As a result, for the fiscal year, revenue was ¥27,430 million, up 1.2% year on year, operating profit was ¥556 million, down 0.4%, ordinary profit was ¥621 million, up 13.4%, and profit attributable to owners of the parent was ¥383 million, up 71.6%.」

「Our group has promoted selective focus on the beverage manufacturing retail business (SPA), which provides products and services that satisfy customers, in order to enhance the company's raison d'être, while working to transform its business structure with an emphasis on profitability. As a result, for the 9-month period ended 31 December, revenue was ¥21,314 million, up 2.1% year on year, operating profit was ¥603 million, down 3.4%, ordinary profit was ¥673 million, up 12.0%, and profit attributable to owners of the parent was ¥424 million, up 14.4%. Revenue in the beverage manufacturing business was ¥8,367 million, up 16.6% year on year, and segment profit was ¥522 million, up 12.5%.」

「Our group has promoted selective focus on the beverage manufacturing retail business (SPA), which provides products and services that satisfy customers, in order to enhance the company's raison d'être, while working to transform its business structure with an emphasis on profitability.」

「Against this backdrop, our group has promoted selective focus on the beverage manufacturing retail business (SPA), which provides products and services that satisfy customers, in order to enhance the company's raison d'être. As a result, for the 3-month period ended 30 June, revenue was ¥7,295 million, up 3.0% year on year, operating profit was ¥265 million, up 18.6%, ordinary profit was ¥243 million, up 18.4%, and profit attributable to owners of the parent was ¥139 million, up 0.3%.」

「Against this backdrop, as the domestic beverage market matured, our group focused on strengthening its business foundations and securing earnings by developing new products, expanding sales channels and reducing costs. Revenue declined year on year because unfavorable summer weather, together with a review of selling prices, led to decreases in vending-machine sales volume and beverage production volume. On the earnings side, however, group-wide cost-reduction efforts contributed to increased profit. As a result, for the 9-month period ended 31 December, revenue was ¥20,883 million, down 4.4% year on year, operating profit was ¥624 million, up 32.4%, ordinary profit was ¥601 million, up 23.3%, and profit attributable to owners of the parent was ¥371 million, up 44.5%.」

「Although sales declined year on year because vending-machine sales volume and beverage production volume decreased, partly as a result of reviewing selling prices and unfavorable summer weather, the results of Group-wide cost-reduction efforts contributed to higher profit. As a result, for the six months ended September 30, sales were ¥14,396 million, down 5.0% year on year; operating profit was ¥524 million, up 29.5%; ordinary profit was ¥497 million, up 17.5%; and quarterly profit attributable to owners of the parent was ¥290 million, up 28.7%.」

「We improved profitability by making production more efficient and reducing production costs. As a result, revenue from the beverage manufacturing business was ¥2,501 million, down 4.7% year on year, while segment profit was ¥199 million, up 56.4%.」

「The vending-machine industry as a whole is reaching a major turning point, making business restructuring focused on profitability an urgent priority not only for our company but also for improving the competitiveness of the industry as a whole and transforming its structure.」