Overview for the First Half of the 83th fiscal year

During the first half of the consolidated fiscal year under review, the global economy continued to recover, despite little indication of progress in some regions. However, the outlook remained uncertain amid factors such as rising geopolitical risks around the Middle East in addition to concerns over economic trends in Europe and the United States and the impact of export restrictions imposed by the United States and China.

Looking at the business environment surrounding the Group, in electronics applications, performance remained strong, supported by high demand for SiC semiconductor applications. Demand was solid in mobility applications, against the backdrop of steady operations in the automotive industry. Demand remained stable in general industries, supported by customers' steady capital investment.

In this environment, the Group worked to strengthen and develop high value-added products that can keep pace with technological innovations and to improve cost competitiveness through increased productivity, in order to achieve the management targets of the Medium-term Management Plan. Manufacturing, sales, and development departments worked together to accelerate the shift to high value-added products, responding to increasingly sophisticated customer needs and steadily capturing business opportunities. In addition, we advanced initiatives aimed at improving profitability through price pass-throughs and other measures to mitigate the impact of soaring costs for raw fuels and labor.

As a result, in the first half of the consolidated fiscal year under review, net sales were 26,284 million yen (up 10.8% year on year). In terms of profits, due mainly to the exchange rate factor and increased marginal profit through such measures as price pass-ons and sales mix differences, operating profit was 5,808 million yen (up 26.0% year on year), ordinary profit was 6,994 million yen (up 31.0% year on year), and profit attributable to owners of parent of 5,156 million yen (up 24.9% year on year).

Future outlook

There are many uncertainties in the future, including the economic outlook in Western countries and China as well as the impact of policies and regulations in each country on industry. The Group will make every effort to achieve the plan by steadily capturing demand, in high-value-added fields such as semiconductors, while keeping a close eye on the macro environment and the trends in the face-to-face market.

Based on the above, we expect net sales of 54,000 million yen (a 9.6% year-on-year increase), 10,900 million yen in operating profit (a 17.4% year-on-year increase), 10,500 million yen in ordinary profit (a 3.1% year-on-year increase), and 7,600 million yen in profit attributable to owners of parent (a 1.2% year-on-year increase) in the fiscal year ending December 31, 2024.

We thank you, our shareholders, for your continued support.

September, 2024