On 31 October 2025, DAIKEN MEDICAL, running operations to develop, manufacture and sell medical devices used for prevention of hospital-acquired infections and postoperative pain management, released its results for Q1 to Q2 FY03/2026. It has been revealed that sales of COOPDECH Amy PCA, used for postoperative pain management and known for its innovative features, continued to perform strongly. In addition, the Company achieved sales growth for FitFix, its long-standing mainstay product used for prevention of hospital-acquired infections. As a result, the Company secured year-on-year sales growth for Q1 to Q2. However, earnings declined due to the impact of rising material costs and increased R&D expenses. Meanwhile, from a long-term perspective, COOPDECH Amy PCA is expected to continue contributing to growth, enhancing the Company’s overall growth potential. In addition to significant room for expansion in the domestic market in Japan, the Company is planning to launch and expand the product in Europe and other overseas markets.

On 6 November 2025, Shinwa, which manufactures, sells and installs scaffolding equipment used in the fields of construction work, as well as manufacturing and selling logistics equipment, released its Q1 to Q2 FY03/2026 results. It has been revealed that the Company saw an all-time high since listing achieved in both revenue and earnings. Furthermore, full-year Company forecasts have been revised upward and yearend dividend per share as well from ¥16.0 to ¥18.0. According to the Company’s indications, this performance has been significantly driven by increased revenue from large-scale logistics warehouse projects on the Logistics Equipment side. On the Scaffolding Equipment side, the Company saw revenue roughly unchanged over the same period of the previous year, but it will begin benefiting from addons of KAIZU KENSETSU Co., Ltd. to be newly consolidated from Q3 (October to December). As outlined in the basic strategy of the Medium-Term Management Plan (FY03/2025 to FY03/2029), M&A initiatives that are expected to generate synergies with existing businesses are being steadily executed. We are to attend the Company’s financial results briefing on the web, scheduled for 25 November, which will be followed by our interview with the management, so that we should be able to update our Company Report and release it afresh in due course.

On 16 October 2025, INTERLIFE HOLDINGS, which runs operations of providing total services such as design, construction and maintenance management for commercial & public facilities, held its results briefing for Q1 to Q2 (March to August) FY02/2026. It has been revealed that the Company saw operating profit doubled over the same period of the previous year for the actual results of Q1 to Q2 (March to August), resulting in a prospect that it will achieve operating profit of ¥1,000m set as the target for the final year of the midterm management plan (FY02/2026 to FY02/2028) as early as in the first year, i.e., FY02/2026. Sales are surging for large-scale projects with high profitability, associated with special effects equipment (for sound, video, lighting and rigging) mainly for hotels, which is driving the Company’s gross profit margin upward and being a factor for the performance far better than expected earlier. Once the earnings trend for H2 (September to February) is confirmed, the midterm management plan is likely to be revised. We are to gain further insights through interviews with the Company’s management and, based on the findings, update and re-release our Company Report.

NORITZ, running operations mainly to manufacture and sell gas water heaters & oil-fired boilers both in Japan and foreign countries, has begun to show signs of a recovery trajectory in its earnings. Toward FY12/2025, the Company appears to be on track to achieve an earnings improvement exceeding the assumptions of initial Company forecasts. In addition to the contribution from price revisions implemented from the beginning of the year, the Company is seeing a sales increase in Japan due to higher unit sales of high value-added and/or environmentally friendly products, while overseas, measures to lower the break-even point in China are proving effective. However, the initial Company forecasts have been left unchanged due to the need to carefully assess the impact of additional tariffs and market trends in China toward H2 (July to December). Meanwhile, the Company, which is actively involved with Promotion of Sustainability-Oriented Management, has announced a policy to strengthen its response to carbon neutrality and social issues by focusing on the development and expansion of environmentally and socially responsive products. For example, the Company is focusing on the development and expansion of products that combine heat pump technology (a technology that efficiently heats and/or cools by transferring thermal energy from air or water) with high-efficiency gas water heaters. As its “Vision for 2030,” the Company aims to achieve a 90% sales composition ratio for environmentally friendly products in Japan (versus 40% in 2023) as well as reducing CO₂ emissions from sold products by 30% compared to 2018.

INTERLIFE HOLDINGS, which runs operations on the Interior Construction side and the Sound & Lighting Facilities side (providing total services such as design, construction and maintenance management for commercial & public facilities), is implementing a policy to pursue sustainable earnings growth toward 2030. The Company aims to enhance its earning power by capturing construction demand in the Tokyo metropolitan area and demand related to the integrated resort (IR) development in Osaka, being flexible in response to the constantly changing market environment. For Q1 (March to May) FY02/2026, the impact of a reactionary decline from the concentration of large-scale projects during the same period of the previous year was limited and steady sales growth was achieved, with 66.6% of full-year operating profit assumed in Company forecasts already attained. However, Company forecasts have remained unchanged, since the orders for backlog of projects on the Interior Construction side for H2 (September to February) have not been fully confirmed at this point, according to the Company. For FY02/2025, the Company saw an unprecedented concentration of sales from large-scale projects, which also had a significant impact on profitability as they often carried high profit margin. Meanwhile, the Company, which is actively working to enhance both shareholder returns and capital efficiency, has continued to roll out a series of initiatives, comprising a substantial dividend increase, implementation of interim dividend to expand shareholder return opportunities and share buybacks.

On 7 August 2025, Sanyo Homes, running operations of mainly building houses on a contract basis and developing condos for sale, released its results for Q1 (April to June) FY03/2026. It has been revealed that the Company is achieving a rapid recovery in earnings situation compared to the same period of the previous year due to the recovery on the Condos Business side, which is responsible for developing condos for sale. For Q1 (April to June), sales were boosted by the completion and delivery of “Grancrea iiNE Town in Mizuho,” as well as the posting of sales from properties delivered out of plan. Meanwhile, on the Hosing Business side, which is responsible for mainly building houses on a contract basis, the Company saw operating loss expanded year on year, although order intake has started to pick up, which is far more than compensated for by the recovery on the Condos Business side. As a new initiative, the Company has announced plans to utilize its owned assets. It will lease land and buildings it owns in Wakayama-prefecture to an international school scheduled to locally open in September 2027, aiming to generate stable rental income from a long-term perspective. According to the disclosure dated 22 August 2025 (in Japanese), the Company intends to raise funds for the renovation of existing buildings into educational facilities through both debt and equity financing. Furthermore, it is reportedly considering engaging in construction contracts for student dormitories and related infrastructure.

On 19 August 2025, EM SYSTEMS, which develops and sells IT systems of mission-critical tasks for pharmacies as the leader in Japan, live-streamed its financial results briefing for the Q1 to Q2 (January to June) FY12/2025 results. It has been revealed that assumptions of initial Company forecasts were well exceeded due to earlier-than-expected emergence of demand related to welfare administration projects. Meanwhile, full-year Company forecasts have remained unchanged. For Q1 to Q2 (January to June), the Company saw sales far better than expected with respect to projects to implement e-prescription systems and provision of optional software for online eligibility verification systems, while the Company is in the process of closely examining trends for H2 (July to December) at present. The Company aims for organic growth through an increase in its market share, but it saw an addon stemming from demand related to welfare administration projects to occur irregularly, which had significantly driven the Company’s performance for FY12/2024, having further contributed also for Q1 to Q2 (January to June) FY12/2025. Now, the impact stemming from demand related to welfare administration projects is beginning to subside for H2 (July to December) and thereafter, implying that the Company’s performance is to reflect steady growth driven by organic expansion in the near future.

On 8 August 2025, NORITZ, running operations mainly to manufacture and sell gas water heaters & oil-fired boilers both in Japan and foreign countries, held its Q2 (January to June) FY12/2025 financial results briefing via conference call. It has been revealed that the Company achieved a significant improvement in earnings situation over the same period of the previous year. This was driven by the positive impact of price revisions implemented at the beginning of the year, as well as increased unit sales in Japan, particularly of high-value-added and environmentally friendly products, with which the Company has benefited from an effect of higher sales. In addition, cost-saving measures proved effective and further supported the improvement. Overseas, although sales declined, earnings increased. In China, where market conditions remain sluggish, unit sales stagnated, leading to downward pressure on earnings. However, the Company implemented thorough cost control measures, which lowered the break-even point and generated a larger positive impact on earnings situation. Although Company forecasts were far exceeded in the results for Q2 (January to June) with respect to earnings in particular, full-year Company forecasts have remained unchanged. This reflects the Company’s cautious stance in light of rising risks associated with the Chinese market and potential additional tariffs. We are to have an interview with the management to obtain further details so that we should be able to update and release our Company Report afresh.

On 14 August 2025, Fast Accounting, which automates and streamlines accounting tasks through accounting-specific AI, released its results for Q1 to Q2 (January to June) FY12/2025. It has been revealed that clients, centered around existing ones, have started utilizing the Company’s Accounting AI agent built on its proprietary platform, Deep Dean. This software agent autonomously executes specific tasks and objectives related to accounting processes, indicating that products and services related to the Accounting Singularity are beginning to be rolled out in earnest. In the lead-up to this point, Deep Dean has surpassed the passing standards of both the Japanese CPA and US CPA exams. Meanwhile, the Company continues to see growing demand for consulting services to support the implementation of its accounting AI agent. Another notable development is that Robota, the Company’s flagship product suite, has been adopted in InspectData, a platform provided by NTT DATA WITH, a key sales partner. According to the Company, this partnership is expected to enable more efficient and broader expansion of sales derived from its products and services.

On 7 August 2025, TOW, focusing on the development of advanced planning & production for integrated promotions, released its results for FY06/2025 and held the results briefing (live stream). It has been revealed that the Company achieved record high in both sales and recurring profit, excluding addons from specific BPO operations during the COVID-19 pandemic. The Company’s initiatives to drive its business through a “twin spindles” approach, i.e., client base expansion and domain expansion, appear to be bearing fruit. On 15 January 2025, the Company established a new group structure by making Qetic, a digital production company with strengths in entertainment and cultural content domain, a subsidiary. The Company is accelerating collaboration with its subsidiaries highly specialized in areas such as events, video production and digital, aiming to enhance both the quality and profitability of operations. By placing experiential value at the core, the Company seeks to generate synergy with integrated promotions and event planning & production, focusing on expanding its business across three categories of operations: real-world events, integrated promotions and hybrid events. Through those efforts, the Company aims to achieve sustainable growth.

On 7 August 2025, KAGA ELECTRONICS, major electronic components trading company, announced its results for Q1 (April to June) FY03/2026. Simply according to the Company’s statement, the highlight is that sales and earnings have risen for Q1 (April to June), while full-year Company forecasts have been revised up from a previous outlook of a decline in sales and earnings to one of an increase in both with an addon from Q2 (July to September) and onward as a result of having acquired Kyoei Sangyo (6973). The Company further states that it is noteworthy that it expects to see DOE of 4.2% for FY03/2026 with planned dividend revised up, as well as ROE of 14.6% and total shareholder return ratio of 83.3% with a largest-ever share repurchase and cancellation totaling ¥14,447m, demonstrating its commitment to improving capital efficiency and shareholder returns as advocated with the new midterm management plan. On 8 August 2025, through off-auction own share repurchase transactions (ToSTNeT-3) on the Tokyo Stock Exchange, the Company acquired 4,917,400 shares of common share. Furthermore, it plans to cancel all of the repurchased shares—equivalent to 9.4% of the total number of shares outstanding (excluding treasury shares)—on 18 August 2025. Notably, this will be the first share cancellation for those to be repurchased since the listing.

On 7 August 2025, MIMAKI ENGINEERING, which drives digitization of industrial-level printing, released its Q1 (April to June) FY03/2026 results. It has been revealed that the Company’s performance was significantly affected by yen’s appreciation and additional tariffs, resulting in a YoY decline in both sales and earnings. However, excluding the impact of yen’s appreciation, the Company secured growth in both sales and earnings. The stronger yen led to reductions in sales and operating profit and uncertainty surrounding the imposition of additional tariffs contributed to a decline in sales of North America and Europe, even on a local currency basis. Sales in Japan increased significantly, but it was not sufficient enough to offset the declines in other regions. Meanwhile, the Company, which advocates for stable profitability and consistent sales growth, is actively making upfront investments to explore new business domains through aggressive resource allocation, even during Q1 (April to June). New product launches did contribute during the period, but the impact of external factors such as exchange rates and tariff rates has temporarily intensified.

On 4 August 2025, Shinwa, which mainly manufactures, sells and installs scaffolding equipment used in the fields of construction work, announced its results for Q1 (April to June) FY03/2026. It has been revealed that the Company achieved record-high revenue and earnings at all stages for Q1 since its listing. In comparison with the same period of the previous year, the Company saw revenue steadily increased and thus effect of higher revenue, while efforts to reduce manufacturing costs have also begun to bear fruit, resulting in a significant increase in operating profit. Assumptions for revenue of Company forecasts were rather exceeded on the mainstay Scaffolding Equipment side as well as on the Logistics Equipment side, while the Company saw a high year-on-year growth in revenue on the Logistics Equipment side in particular. However, Company forecasts have remained unchanged from a conservative standpoint. On the Logistics Equipment side, the Company has announced a policy to contribute to solving more challenges by focusing not only on improving the performance and expanding the lineup with respect to existing products, but also on developing new products that meet increasingly diverse market needs.

On 15 July 2025, INTERLIFE HOLDINGS, which runs operations on the Interior Construction side and the Sound & Lighting Facilities side (providing total services such as design, construction and maintenance management for commercial & public facilities), announced its results for Q1 (March to May) FY02/2026. It has been revealed that sales and earnings are steadily rising so far for FY02/2026, following a significant increase in sales and earnings for FY02/2025, while the Company has announced the implementation of an interim dividend aiming to enhance shareholder return opportunities. For Q1 (March to May), the Sound & Lighting Facilities side achieved a substantial increase in both sales and earnings, largely driven by the progress of large-scale projects exceeding initial plans. On the other hand, the Interior Construction side was forced to post a decline in both sales and earnings compared to the same period of the previous year, mainly due to the recoil from the concentration of sales resulting from the completion of large-scale projects during the same period of the previous year. The Company as a whole has already achieved 66.6% of its full-year Company forecasts for operating profit at the Q1 (March to May) stage. We are to gain further insights through interviews with the Company’s management and, based on the findings, update and re-release our Company Report.

TOW, which is focusing on the development of advanced integrated promotion planning & production, aims to enhance its long-term growth potential through these efforts. Although the Company achieved significant increases in both sales and earnings for FY06/2024 due to the full recovery from the COVID-19 pandemic, sales have been sluggish so far for FY06/2025. For Q4 (April to June), sales of Expo-related operations (such as event production and management) are being posted and full-year performance is expected to show increases in both sales and earnings. However, due to the absence of sales posted for FY06/2024 from a major automobile exhibition and a major IP content project, both the sales growth rate and earnings growth rate are expected to remain at limited levels. Nevertheless, the Company is actively promoting investments in human capital to enhance its long-term growth potential, and is also advancing initiatives in key areas such as AI and the environment. Although these initiatives involve associated costs, they are largely offset by improved profitability resulting from a focus on high value-added fee-based operations and in-house production within the group. As a result, both the sales growth rate and earnings growth rate are expected to trend steadily for FY06/2026 and beyond.

HAGIWARA ELECTRIC HOLDINGS, a technology trading company specializing in automotive electronics, is currently in a recovery phase in terms of short-term trends of earnings. The impact of adjustments in automobile production volumes is gradually subsiding, and the Company is steadily capturing demand for capital investment related to vehicle electrification. As a result, it is expected to achieve a transition from sales growth with declining earnings to sales and earnings growth between FY03/2025 and FY03/2026. Additionally, the emerging sales of the data platform business, which has been strengthened through M&A activity, are also contributing to this positive outlook. While the Company continues to incur costs associated with growth investments aligned with its key strategic focus of “enhancing earning power” under the midterm management plan (FY03/2025 to FY03/2027), the effects of recent investments are beginning to materialize and positively impact profitability. Historically, the Company’s core business model has centered on wholesale distribution of semiconductors used in electronic control units (ECUs) for various systems such as engines, brakes, and multimedia, primarily to Tier 1 suppliers within the Toyota Group. Looking ahead, the Company aims to expand its involvement in providing diverse solutions, thereby driving further enhancement of its earning power and transitioning into a new growth stage. During the period of the midterm management plan, the Company is expected to make progress in structural reforms and establishing a solid business foundation to realize this transformation. The plan also targets CAGR of 10.0% in sales and 12.6% in operating profit over the three-year period.

Shinwa, which mainly manufactures, sells and constructs scaffolding equipment for the use in the fields of construction work, is to continue seeing its operations performing well in line with assumptions of its midterm management plan (FY03/2025 to FY03/2029), calling for prospective revenue of ¥20,000m or higher and operating profit of ¥2,400m or higher for FY03/2029, the final year of the plan, implying operating profit margin of 12.0% at the lower limit. When setting the FY03/2024 results as the point of origin, the Company is to see minimum CAGR of 9.5% in revenue and 27.9% in operating profit. The actual results of FY03/2025, the first year of the plan, were in line with initial assumptions, which is followed by emerging synergy from a vertical M&A (between companies at different stages of the supply chain) for FY03/2026 and thereafter. On 1 April 2024, the Company, which ranked first in Japan for “manufacture & sale” of scaffolding equipment (system scaffoldings), has acquired YAGUMI Group (currently, wholly-owned subsidiary), one of Japan's leading operators to “construct” scaffolding equipment. FY03/2026 Company forecasts look being based on conservative assumptions, while the Company, which is considering further strategic M&A deals, is likely to achieve favorable performance from a long-term perspective.

Sanyo Homes, running operations of mainly building houses on a contract basis and developing condos for sale, is going for substantial increases in sales and earnings for FY03/2026. On the Housing Business side, which is responsible for building houses on a contract basis, the Company is looking to firmness in sales of real estate solutions. The Company has been successfully matching landowners with business owners, bringing in increasing order placement for large-scale facilities such as nursing homes, medical malls, company housings, shopping centers and so on. At the same time, the Company is promoting the use of own lightweight steel frame components, when building properties, which is enhancing rate of utilization in own manufacturing facilities. Further, the Company is to benefit from an improvement in cost rate, stemming from the passing on of higher raw material prices to customers on a full-year basis. Meanwhile, on the Condos Business side, which is responsible for developing condos for sale, the Company is looking to sales driven by a directionality of demand for properties newly completed being so buoyant. The midterm management plan (FY03/2025 to FY03/2027) suggests CAGR of 12.3% in the Company’s sales and 36.1% in operating profit. The results were rather stagnating for FY03/2025, the first year of the plan, while FY03/2026 Company forecasts are going for performance, exceeding assumptions of the midterm management plan, while the performance goal has remained unchanged for FY03/2027, the final year of the plan. According to the Company, there was an aspect for sales to have been delayed for the FY03/2025 results, which is to result in sales larger for FY03/2026 to a corresponding extent.

NORITZ, running operations mainly to manufacture and sell gas water heaters & oil-fired boilers both in Japan and foreign countries, is seeing a recovery in its performance. This is due mainly to a trend that the Company is facing a turning point for the number of units sold, which is highly influential to its earnings as a whole. On a full-year basis, the Company has inevitably suffered from a decline in earnings for FY12/2023 and for FY12/2024 as well, due to a decline in the number of units sold. On a quarterly basis, however, the Company saw a changeover from declining to increasing for the number of units sold for Q4 (October to December) FY12/2024 and this trend has continued into Q1 (January to Maruch) FY12/2025, which substantially drove earnings for each quarter during the relevant period. Further, the Company is looking to a possibility for this trend to persist for Q2 (April to June) and thereafter, while also looking to gradually emerging benefits from its measures to cut back on cost of sales advocated by the midterm management plan V-Plan 26 (FY12/2024 to FY12/2026) for FY12/2026. During the relevant period, the Company is to cut back on cost of sales by collective \3,000m, while it has made progress in line with this goal to date. For reference sake, the Company suggests that the bulk of the benefits comes from reductions in procurement via component standardization.

SENSHU ELECTRIC, which focuses on development of its operations as electric wires general trading company, is steadily implementing measures as planned in its midterm management plan (FY10/2025 to FY10/2027) as well as seeing an increase in sales. For Q1 to Q2 (November to April) FY10/2025, the Company has suffered from short-term adjustment in earnings, but it appears that sales and earnings are likely to continue growing from a long-term perspective. For Q1 to Q2 (November to April), sales of FA Cables, which are said to carry gross profit margin the highest by category of products, have declined on a year-on-year basis, while sales of Power Cables, which are said to carry gross profit margin relatively lower, have risen. With respect to FA Cables, the Company saw one-off concentration of sales during the same period of the previous year, while sales are adjusting in some part of demand from semiconductor production equipment and machine tools. More importantly, however, such demand appears to recover at some stage of H2 (May to October), according to the Company. As for Power Cables, the Company has steadily captured increasing demand from the construction sector as well as benefiting from higher price of copper. In April 2025, the Company set up Nagoya FA Center (Inazawa-city, Aichi-prefecture), which is an example of the enforcement of policy for growth in that this has the objective to enforce own operations for processing of control panels and soil heaters, both of which are expected to drive the Company’s growth from a long-term perspective.

On 5 June 2025, DAIKEN MEDICAL, running operations to develop, manufacture and sell medical devices mainly used for prevention of hospital-acquired infections and postoperative pain control, held its financial results briefing for FY03/2025. It has been revealed that the Company is trying to raise own internal manufacturing ratio from some 20% at the moment to 50% as the target by making a changeover from the mainstay existing off-patent products being exposed to lowered competitiveness and a rise in manufacturing costs to new products as well as internally manufacturing them. According to the Company, this is to lead to achievement of 50% for gross profit margin and thus 50/50 in conclusion. For the FY03/2025 results, the Company saw gross profit margin of 41.2% (up 0.3% points). FY03/2026 Company forecasts are going for prospective sales to rise but decline for earnings, conservatively assuming increased impact stemming from a rise in manufacturing costs. Further, Company forecasts also assume increased costs as a result of human capital investment and capital expenditure to promote internal manufacturing. In other words, the Company intends to achieve a V-shaped recovery in earnings from a midterm perspective, while formulating midterm management plan, which is to be disclosed at the stage of making some progress in its strategy to enhance internal manufacturing, as far as we could gather.

MIMAKI ENGINEERING, which drives digitization of industrial-level printing, aims to accelerate its growth potential from a long-term perspective by developing its operations in line with the basic policy of its long-term growth strategy, Mimaki Innovation 30. Allocating 1% to 2% of sales to investment in new domains, apart from the existing R&D investment, the Company aims to achieve CAGR of 12.3% in sales over the five-year period to FY03/2030 with Innovation in the literal sense to be created. For earnings, the Company has seen operating profit margin of 10.9% (up 3.6% points YoY) for the FY03/2025 results, while calling for no more than 8% or higher for FY03/2030, because of assuming the impact stemming from the above-mentioned upfront investment. Nevertheless, it is the case that the said burden associated with the upfront investment will be the very nature for Innovation and thus enhancement of growth potential. Based on the lower end of prospective operating profit margin for FY03/2030, i.e., 8%, the Company is calling for CAGR of 5.7% in earnings. The Company suggests that it will continue to pursue sales growth with stable profitability and take on new challenges in new domains via its initiative-taking use of own resources at the same time.

INTERLIFE HOLDINGS, running operations mainly of interior construction and sound & lighting facilities (comprehensive services of design, construction work, maintenance management and so on for commercial and/or public facilities), has set NEXT STAGE 2030 as the slogan for its 5fth midterm management plan (FY02/2026 to FY02/2028), while having announced a policy to enhance profitability by capturing construction demand in the Tokyo metropolitan area and demand related to integrated resort developments in Osaka, with a view to growth through CY2030. The Company is calling for CAGR of 12.2% in sales and 38.7% in operating profit for FY02/2028, the final year of the plan, when setting the FY02/2024 results as the point of origin. For the FY02/2025 results, which immediately followed the FY02/2024 results, there is an aspect that the Company has intensively posted sales and operating profit. The Company suggests that it aims to achieve sustainable growth in earnings by means of flexibly responding to ever-changing market environment. Still, FY02/2026 Company forecasts are going for decreased sales and earnings, as the Company is to suffer from a decline in sales as a result of its business restructuring and a contribution reduced with respect to large-scale projects carrying high profitability on a year-on-year basis. For the results of the previous year, i.e., FY02/2025, the Company has achieved substantially increased sales and earnings, driven by a surge in the number of large-scale projects such as those of the Osaka Expo and urban redevelopments. For FY02/2026, the Company is to be forced to undergo short-term adjustments, but prospects are bright from a long-term perspective, as far as we could see.

On 22 May 2025, KAGA ELECTRONICS, major electronic components trading company, held its on-the-web financial results briefing for FY03/2025. It has been revealed that FY03/2026 Company forecasts are going for a recovery in sales for H2 (October to March) as the impact of inventory adjustments will run its course, although the said impact will persist for the time being. In the FY03/2025 results, the Company has suffered from prolonged inventory adjustments at major customers as well as suspensions of trading with a couple of specific customers, having resulted in sluggish sales. Meanwhile, FY03/2026 Company forecasts also assume risks of reducing sales and earnings, stemming from the US tariffs issues and yen’s appreciation. Thus, sales and earnings on a full-year basis are expected to decline. It is suggested that Company forecasts are conservative in the respect of reasonably assuming foreseeable risks, while going for increased sales and earnings, if such risks are not taken into account, i.e., sales of ¥557,000m (up 1.7%), operating profit of \24,000m (up 1.7%) and operating profit margin of 4.3% (up 0.0% point) for FY03/2026.

On 12 May 2025, Sanyo Homes, running operations of mainly building houses on a contract basis and developing condos for sale, released its FY03/2025 results. It has been revealed that the Company had returned to profitability on the Housing Business side to mainly build houses on a contract basis, having begun benefiting from its measures to pass on rising raw material prices and labor costs to selling prices, while being likely to do so on a full-year basis for FY03/2026. Further, the Company is also benefiting from its policy to beef up capacity utilization rate in its own factory to manufacture lightweight steel frames by means of actively adopting them for large-scale facilities on top of the existing detached houses, rental housing and so on. The Company suggests that it has been promoting such adoptions for some time when receiving incoming order intake for nursing care facilities, medical malls, company housing and other commercial facilities. As a result, the Company did see an improved rate of capacity utilization in its own factory and the impact of this is also expected to expand for FY03/2026. We are to attend the Company’s results briefing to be held on Friday, 30 May, while planning to interview with the management so that we should be able to update our Company Report to release afresh.

On 15 May 2025, Fast Accounting, which advocates business reform through accounting-specific AI, released its Q1 (January to March) FY12/2025 results. It has been revealed that the Company is seeing an ongoing high growth in sales as well as heaping up specific achievements associated with realization of Accounting Singularity and development of the US market to exponentially accelerate its growth for the future. Deep Dean, the Company’s proprietary AI, has scored 100% in all four sections of Japan’s CPA short-term exam and far exceeded criteria for USCPA exam, beginning to demonstrate the leading capability in the market with that of being well leveraged in specialist accounting work. Further, it appears that the Company is on the verge of benefiting from its local operations of marketing in the United States. The Company is calling for prospective sales of ¥10,000m (versus ¥1,707m for the FY12/2024 results) and operating profit margin of 10% (10.6%) for FY12/2028 as its Stretch Goal. The existing sales of products and services associated with AP (Accounts Payable) automation will continue growing fast, while those of Accounting Singularity and the entrance into the markets overseas will emerge and surge toward FY12/2028, according to the Company. On top of this, the Company is also looking to such contribution from Platform Realm as well.

On 15 May 2025, EM SYSTEMS, which develops and sells IT systems of mission-critical tasks for pharmacies as the leader in Japan, released its Q1 (January to March) FY12/2025 results. It has been revealed that sales were posted ahead of schedule for the operations to meet government administration of medical affairs and thus Company forecasts were upgraded for Q1 to Q2 (January to June). The Company suggests that it has made progress in its operations to meet the needs for medical DX ahead of schedule, such as those of coping with medical-aid issues related to livelihood protection for online eligibility verification systems and introducing electronic prescription systems. More importantly, however, the Company perceives that all those operations to meet government administration of medical affairs are nothing but irregular addons, while trying to get at organic growth from a long-term perspective, based on its measures to enhance own wallet share on the mainstay IT Systems for Pharmacies side. For Q1 (January to March), sales have steadily risen for initial systems, driven by expanding sales of “Sumareki with Recepty” in line with increasing demand for introductions and replacement as well as an increase in provisions of services ne with replacement of own products, while having secured an increase in sales for system usage fees and consumable goods. Meanwhile, the Company suggests that there is ample room to enhance own market shares on the Clinics side and the Long-Term Care / Welfare side.

On 15 May 2025, TOW, which focuses on the advanced development of planning & producing for integrated promotions, released its Q1 to Q3 (July to March) FY06/2025 results. It has been revealed that the Company is likely to achieve an increase in sales and earnings on a full-year basis, as initially expected, although sales and earnings have declined for the said period. According to the Company, sales associated with the Expo 2025 assignments will be posted intensively for Q4 (April to June). In the business environment surrounding the Company, demand for real-world experiences such as events and advertising for promotions of sales continues to be strong, but sales have declined due to the absence of the impact of large-scale automotive exhibition that posted sales during the same period of the previous year. For earnings, the Company has almost maintained high margin at the gross profit level, supported by its fee-based operations to provide high added value and in-house producing on a group basis, while having suffered from the impact of increased SG&A expenses, which was driven by increased personal expenses as a result of aggressive investment in human capital and increased expenses associated with its initiatives in areas of focus such as AI and environment. We are to interview with the management to obtain further details, so that we should be able to update and release our Company Report afresh.

On 13 May 2025, NORITZ, running operations mainly to manufacture and sell gas water heaters & oil-fired boilers both in Japan and foreign countries, released its Q1 (January to March) FY12/2025 results. It has been revealed that a significant increase in earnings was achieved, due mainly to an increase in the number of units sold on the Domestic Operations side. The Company suggests that it has benefited from increased marginal profit and improved productivity, while having seen firm sales of high-value-added products and those of high efficiency at the same time, which resulted in improved profitability. On the other hand, the Company suggests that it has seen a decrease in the number of units sold in China, but it is more important that the local operations saw an improvement in earnings over the same period of the previous year, due to the success of having introduced measures to lower break-even point. In North America, the Company has reduced its loss, while having seen ongoing increases of sales and earnings in Australia. The Company’s earnings were also driven by the effect of revisions on selling prices, although it appears that the impact was basically offset by soaring raw material prices. The cost reduction measures advocated by the Company are to take full effect for FY12/2026, contributing to further improvement in earnings. We are to have an interview with the management to obtain further details so that we could update and release our Company Report afresh.

On 14 May 2025, Shinwa, which mainly manufactures, sells and constructs scaffolding equipment for the use in the fields of construction work, released its FY03/2025 results. It has been revealed that the Company saw surging revenue and earnings as expected in initial Company forecasts. This is largely due to the acquisition of the YAGUMI Group, one of the leading operators to construct scaffolding equipment in Japan, as a subsidiary in April 2024. It appears that the impact was substantial for earnings in particular. The said subsidiary’s operations to construct scaffolding equipment carry gross profit margin higher in the first place, when compared with that of the existing operations to manufacture and sell scaffolding equipment. Meanwhile, FY03/2026 Company forecasts look being based on conservative assumptions. We are to attend the Company’s results briefing to be held on Thursday, 29 May, while planning to interview with the management so that we should be able to update our Company Report to release afresh.

On 15 April 2025, INTERLIFE HOLDINGS, running operations of interior finish work as well as design and construction of sound & lighting facilities, held its results briefing for FY02/2025. It has been revealed that the Company is to potentially see a significant earnings growth from a long-term perspective. The Company is to see a swing in its performance from FY02/2025 to FY02/2026 due to concentration of sales for large-sized projects and restructuring, while we estimate CAGR of almost 40% in operating profit from a long-term perspective, based on the Company’s suggestions. For the actual results of FY02/2025, sales and earnings have just surged, driven by projects related to the Osaka Expo and steady progress in work to complete large-sized projects related to urban redevelopment. Meanwhile, there is an aspect that sales were concentrated far more than initially planned and thus a correction is inevitable for FY02/2026 to immediately follow. Still, the level of operating profit will roughly triple, compared with the actual results of FY02/2024, i.e., the stage immediately prior to the concentration of sales. We are to have an interview with the management to obtain further details in order to update our Company Report and release it afresh.

NORITZ, running operations mainly to manufacture and sell gas water heaters & oil-fired boilers both in Japan and foreign countries, is working on measures to achieve a significant cost reduction during the period of the midterm management plan V-Plan 26 (FY12/2024 to FY12/2026). The impact was rather limited in earnings for FY12/2024, the first year of the plan, while the Company is calling for cost reduction of cumulative ¥3,000m throughout the three-year period of the midterm management plan V-Plan 26, which is to be achieved by realization of smart manufacturing scheme through the establishment of a robust infrastructure of manufacturing system and an increase in the rate of in-house production. The Company is calling for prospective sales of \210,000m, operating profit \4,500m and operating profit margin of 2.1% for FY12/2026, the final year of the plan. Based on a simple comparison, it would appear the Company’s earnings are to be driven mostly by the cost reduction. In the actual results for FY12/2024, the Company was inevitably suffering from a decline in earnings due mainly to sluggishness of market conditions in China, but a recovery in earnings is to begin and persist for FY12/2025 and thereafter, having hit the bottom for FY12/2024. The Company suggests CAGR of 1.9% in sales and 37.1% in operating profit for FY12/2026, when setting the actual results for FY12/2024 as the point of origin.

TOW, focusing on the advanced development of planning & producing for integrated promotions, is strengthening its human capital management and making priority investments in the AI and environmental fields in order to achieve sustainable growth. This incurs a corresponding increase in costs, but the Company is to secure an increase in sales and earnings for FY06/2025 as it succeeds in its measures to enhance profitability by means of promoting fee-based operations and in-house producing. As initially assumed, the Company suffered from decreased sales in the actual results for Q1 to Q2 (July to December) due to the absence of projects related to a biennially-held large automotive exhibition, which posted sales during the same period of the previous year, while anticipating sales for H2 (January to June) to increase substantially over the same period of the previous year due to concentrated sales related to the World Expo. Meanwhile, it appears that the Company continues strategically raising personnel costs for FY06/2025, as it did for FY06/2024, in order to boost employee morale. Further, the Company suggests that 80% of employees have completed an AI learning program so far and the full-scale launch of business efficiency and sophistication through the use of AI tools is underway. On top of this, the Company also suggests that there has been an increase in environment-conscious proposals through the use of the Company's independently developed tool to access CO2 emissions at events, EventGX. In light of all those factors, it should be the case that the turning point from the current investment phase to the growth phase will arrive in the foreseeable future.

On 18 February 2025, EM SYSTEMS, which develops and sells IT systems of mission-critical tasks for pharmacies as the leader in Japan, held its results briefing on the web for FY12/2024. It has been revealed that the Company saw record-breaking levels for its performance due to contribution made by the implementation of M&As with sector peer companies as well as highly concentrated sales related to welfare administration, while being firmly committed to achieving its ROE target of 17% for FY12/2027 (versus 11.8% for FY12/2024) as projected in its midterm management plan (FY12/2025 to FY12/2027). In addition, the Company, which is actively engaged in shareholder return and capital policy, has increased its annual dividend for FY12/2024 from \29.00 to \35.00, implying payout ratio of 101.3%, while planning to maintain annual dividend of ¥35.00 also for FY12/2025, when suffering from a recoil reduction in performance stemming from the above-mentioned concentration of sales and so on, eventually implying payout ratio of 130.5%. On the mainstay IT Systems for Pharmacies side, the Company has set Expand Market Share of Wallets as its business strategy for the future, i.e., intending to raise ARPU related to usage fees and maintenance services of the relevant systems. The Company implies beginning to promote price revisions, upselling (to persuade adoptions of new functionalities) and so on in earnest for FY12/2025.

INTERLIFE HOLDINGS, running operations of interior finish work as well as design and construction of sound & lighting facilities, is on track to achieve considerable increases in both sales and earnings for FY02/2025, which is to be followed by sustainable growth for FY02/2026 and thereafter. For FY02/2025, the Company benefits from the concentration of sales for a number of large-scale projects, which looks inevitably resulting in a recoil reduction in sales for FY02/2026 to immediately follow. More importantly, however, it appears that the Company is likely to see an increase in earnings by means of focusing on projects carrying gross profit margin relatively higher. Meanwhile, the current FY02/2025 Company forecasts, announced on 27 August 2024, are likely to be exceeded, in that the forecasts were exceeded for earnings at the stage of the actual results for Q1 to Q3 (March to November), while the Company suggests no negative factors to arise for Q4 (December to February) as much as offsetting the said overshoots. At the moment, the Company is in the process of carefully examining recent trading for Q4 (December to February), while stating that it is to promptly revise up Company forecasts when necessary.

On 14 February 2025, Fast Accounting, which advocates business reform through accounting-specific AI, released its FY12/2024 results. It has been revealed that Company forecasts were exceeded, while expanding into the operations in the United States in February 2025, followed by an increasing contribution from the realization of accounting singularity. In the United States, the person in charge, assigned by the Company, has extensive knowledge and experience of Enterprise SaaS in the local area, while the Company is to start with a lean team and no advertising, executing local investments within scope of being able to secure operating profit margin of 10% for the Company. Meanwhile, for FY12/2026 and thereafter, the Company expects services related to accounting singularity to accelerate its growth potential. The Company has succeeded in developing AI to make decisions requiring accounting expertise, surpassing human capabilities as a result of its long-term dedication to AI development in the accounting domain. The Company is now entering a phase of providing the outcome as services. For FY12/2025, the Company has set a commitment to shareholders to achieve sales of \2,362m (up 38.4% YoY) and operating profit margin of 10.1% (down 0.5% points), which are assumptions of Company forecasts. Further, the Company has set a stretch goal of achieving sales of \10,000m and operating profit margin of 10% by FY12/2028. On top of ongoing growth in existing accounts payable automation services, the Company expects the above-mentioned overseas operations and services related to accounting singularity to kick in, followed by sustainable growth.

On 13 February 2025, NORITZ, mainly running operations to manufacture and sell gas water heaters & oil-fired boilers both in Japan and foreign countries, released its FY12/2024 results. It has been revealed that the last Company forecasts, announced on 5 December 2024, were exceeded, driven by a recovery in domestic demand for home-use gas water heaters & oil-fired boilers, better than assumptions. At the same time, the Company saw another positive factor for sales volume of gas water heaters & oil-fired boilers in China to have been better than assumptions in line with implementation of a subsidiary policy by the local government. Such performance made shareholders’ equity as of the end of the fiscal year larger than assumptions, having resulted in the upgrade of planned annual dividend for FY12/2024 from ¥67.00 to ¥69.00, based on the Company’s mark to realize “DOE of 2.5%“ on an average of shareholders’ equity basis for denominator. Further, the Company has announced that it will acquire own shares up to a total value of \2,000m or some 3.0% of the total number of issued shares excluding treasury shares. Looking forward, the Company is going for an ongoing recovery in its performance for FY12/2025 and thereafter, having hit the bottom for FY12/2024. We are to have an interview with the management to obtain further details in order to update and release our Company Report afresh.

On 5 February 2025, Sanyo Homes, running operations of building houses on a contract basis and developing condos for sale, released its Q1 to Q3 (April to December) FY03/2025 results. It has been revealed that operating profit margin is improving over the same period of the previous year despite a decline in sales. Meanwhile, the Company suggests that it is to intensively post sales for Q4 (January to March) and thus FY03/2025 Company forecasts, going for operating profit margin of 2.5% (up 0.5% points), are to be met. According to the Company, it is now beginning to see an improvement in cost rate, due mainly to the trend that it has begun posting sales in earnest with respect to those of properties whose unit prices being after a passalong of higher cost of labor in the fields of construction work and higher material prices at the stage of order placements. In particular, the Company is seeing a major improvement of cost rate for detached houses, while there was an improvement for a large-scale property completed and delivered for Q3 (October to December) as well. Another factor is that the Company benefits from an increased rate of capacity utilization in its own factory to manufacture materials in line with a policy to exploit them as much as possible. Meanwhile, the Company is to see an intensiveness in completion and delivery for properties on the Condos Business side for Q4 (January to March), which is to post a large amount of sales during the relevant period.

On 13 February 2025, TOW, focusing on the development of planning & producing for integrated promotions, released its Q1 to Q2 (July to December) FY06/2025 results. It has been revealed that performance is in line with assumptions of initial Company forecasts. The Company was forced to accept a decrease in sales and earnings due to the absence of contribution from a large-scale automotive exhibition that took place during the same period of the previous year, but going for a substantial year-on-year increase in sales and earnings for H2 (January to June) as it will intensively post sales associated with the Expo assignments. More importantly, the former will be more than compensated for by the latter, bringing in a steady increase in sales and earnings on a full-year basis. Meanwhile, for the sake of sustainable growth, the Company continues strengthening human capital management as well as implementing intensive investments in the domains of AI and environment, generating an aspect to see increased expenses. Still, there is another aspect for the Company’s measures to improve profitability working well, having resulted in nothing but a marginal decline in gross profit margin for Q1 to Q2 (July to December) in spite of a decline in sales. According to the Company, it has maintained high profitability due to its measures of focusing on fee-based operations that provide high added value and internal producing within the group. We are to interview with the management to obtain further details, so that we should be able to update and release our Company Report afresh.

On 14 February 2025, Shinwa, which mainly manufactures, sells and constructs scaffolding equipment, used in the fields of construction work, released its Q1 to Q3 (April to December) FY03/2025 results. It has been revealed that FY03/2025 Company forecasts are revised up due to factors such as an expectation to post revenue of a project associated with large-scale distribution warehouse on the Logistics Equipment side for Q4 (January to March). Meanwhile, on the Scaffolding Equipment side, the Company is going for a substantial increase in revenue and earnings in line with assumptions of initial Company forecasts. At the stage of Q1 to Q2 (April to September) results, there was an aspect that the Company saw revenue ahead of schedule in some part of the operations, which is to be leveled out on a full-year basis, as far as we could gather. Looking forward, the Company suggests that it is to achieve performance in line with assumptions of the midterm management plan (FY03/2025 to FY03/2029) for FY03/2026 and thereafter. On top of looking to synergy to take off in earnest stemming from acquisition of YAGUMI Group (the largest operator to construct scaffolding equipment in the Tokai region and one of the foremost in Japan), implemented as of the beginning of FY03/2025, the Company also suggests that it is to see large-scale projects on the Logistics Equipment side in addition to that of distribution warehouse.

On 31 January 2025, DAIKEN MEDICAL, running operations to develop, manufacture and sell medical devices mainly used for prevention of hospital-acquired infections and postoperative pain control, released its Q3 (April to December) FY03/2025 results. It has been revealed that rapid growth in sales of COOPDECH AMY PCA, which is used for post-operative pain control, has continued and the said product is steadily contributing to increased sales and earnings of the Company as a whole. It is thought that the market in Japan is beginning to be developed in earnest due to the fact that the said product has superior characteristics compared to existing equivalents. Meanwhile, the Company is focusing on measures for developing markets overseas. Having made expansion in Europe its top priority, the Company is working to obtain MDR (Medical Device Regulation) certification, which is essential for launching products in Europe. As has already been disclosed, the Company will not be able to obtain the certification by the end of FY03/2025 in line with initial agenda, but the Company is continuing and strengthening its close collaboration with the certification organization, taking advantage of services from an overseas medical device development support company and trying to obtain the certification as soon as possible.

On 14 January 2025, INTERLIFE HOLDINGS, running operations of interior finish work as well as design and construction of sound & lighting facilities, released its Q1 to Q3 (March to November) FY02/2025 results. It has been revealed that the Company saw earnings higher than assumed in its full-year Company forecasts. The Company suggests that it has seen progress made earlier than planned for its work process of large scale projects, having accordingly posted sales and gross profit earlier than planned to a corresponding extent, which is mentioned as the main reason for the said performance. Full-year Company forecasts have remained unchanged, but we have an impression that the forecasts are to be consequently exceeded. In fact, the Company is currently in the process of examining recent trading since the beginning of Q4 (December to February). For FY02/2026, the impact stemming from concentration of sales associated with large scale projects will inevitably run its course, while it appears that the Company is trying to secure an ongoing increase in earnings by means of focusing on projects carrying high gross profit margin. We are to have an interview with the management to obtain further details in order to update our Company Report and release afresh.

SENSHU ELECTRIC, which focuses on developments of its business as electric wires general trading company, is calling for sustainable increases in sales and earnings from a long-term perspective, immediately after four consecutive years of the increases. For FY10/2024, the Company saw a stagnation in demand from some part of semiconductor production equipment and machine tools, belonging to the private capex realm, but it was more than compensated for by an increase in demand from automotive production lines, also belonging to the private capex realm, in addition to that of power cables and so on, belonging to the construction realm. The Company is exposed to a wide range of applications related to both of the private capex realm and the construction realm with the highest level of competitiveness in the market, which appears to realize so-called decoupling for the Company’s performance in a sense. That is to say, the Company’s performance and stagnation in some part of the applications to which it is exposed are not necessarily coupled. Furthermore, the Company has benefited from higher selling prices of electric wires for FY10/2024, driven by an increase in the Copper Prices and tighten supply-demand situations, which realized a substantial renewal of record-high sales and earnings. Meanwhile, the Company’s midterm management plan (FY10/2025 to FY10/2027) suggests CAGR of 5.5% for sales and 6.5% for recuring profit during the relevant period, which is based on conservative assumptions, including probabilities of any risk more than a certain extent, as far as we are concerned, while the Company reveals its intention to strive to achieve all the goals at an earlier stage than the last year of the plan.

Shinwa, which mainly manufactures, sells and constructs scaffolding equipment, used in the fields of construction work, is on track to continue achieving steady growth in both revenue and earnings. The midterm management plan (FY03/2025 to FY03/2029) suggests CAGR of 9.5% for revenue and 27.9% for operating profit. At the beginning of FY03/2025, the Company acquired YAGUMI Group (the largest operator to construct scaffolding equipment in the Tokai region and one of the foremost in Japan) as subsidiary, which made a major addon since the initial stage, having driven an improvement in the Company’s earnings for Q1 to Q2, which is to be followed by creation of synergy to gradually expand for H2 and thereafter, according to the Company. During the period of the above-mentioned midterm management plan, the Company states that it will achieve steady growth with a view to long-term growth by building a foundation for achieving further growth in the future. The Company is to pursue its strengths as a manufacturer of scaffolding equipment, while trying to create a fusion of this and the strengths as an operator to construct scaffolding equipment, newly acquired this time, which is expected to structure a solid value chain “from manufacturing to constructing” with respect to scaffolding equipment. In conclusion, this will make it possible to promote expansion in the business domains, according to the Company.

TOW, focusing on the development of planning & producing for sophisticatedly integrated promotions, has entered a phase in which its performance is leveling off after experiencing a significant increase in momentum due to changes in the external environment. For FY06/2024, the momentum in sales increased considerably as the Company steadily captured recovery in demand following the coronavirus crisis and the momentum in earnings, which were enjoying the benefits of increased sales, increased even more. Meanwhile, it is only natural that the momentum in sales enters a period of adjustment for FY06/2025, which immediately follows. However, the Company has begun strengthening its human capital management with a view to long-term growth since H2 (January to June) FY06/2024. Furthermore, the Company is making progress with its focused investment in themes such as AI and environment. In addition, on 31 October 2024, the Company concluded a basic agreement on M&A that can create a large degree of synergy, with the aim of accelerating its focus on integrated promotions. In other words, it can be said that the Company is currently in the process of preparing for a major leap forward from a long-term perspective.

NORITZ, mainly running operations to manufacture and sell gas water heaters & oil-fired boilers both in Japan and foreign countries, is in the process of aiming to recover its performance after two consecutive years of declining sales and earnings. For the operations in foreign countries, the Company has been suffering from stagnated market conditions in China for some time, while in Japan there was an improvement in profit and loss from Q2 (April to June) to Q3 (July to September) in terms of year-on-year changes, which is however suggested to have been followed by a sluggishness in sales of premium products carrying high gross profit margin for Q4 (October to December). For FY12/2024, on the other hand, Company forecasts are going for a substantial improvement at the non-operating level, while having already posted extraordinary profit during the period of Q1 to Q3 (January to September), and thus going for planned annual dividend of ¥67.00 per share, implying payout ratio of 81.4% and dividend on equity of 2.5% in line with the capital policy advocated with the midterm management plan V Plan 26 (FY12/2024 to FY12/2026), resulting in an increase of ¥14.00 per share, when compared to ¥53.00 for the actual results of FY12/2023. In the first year of the plan, the Company’s underlying earnings are under pressure due to a deterioration in external environment and so on, while it appears that the Company is currently in the process of formulating policies to realize a recovery in performance, hitting a major bottom for FY12/2024. For example, on 11 December 2024, the Company disclosed in a release titled, Overview of the Results of the Evaluation of the Effectiveness of the Company's Board of Directors, that it had set out issues to be addressed for FY12/2025. The specific issues set out appear to include measures to accelerate the promotion of Transformation of Business Portfolio, which is the key strategy of the midterm management plan V Plan 26, to a greater extent than before.

HAGIWARA ELECTRIC HOLDINGS, based in Nagoya, develops its operations as a technology-oriented trading house of auto electronics and aims to achieve long-term growth by means of pursuing its role of being “an engineering partner that is connecting human, society and technology, through advanced electronics”, which the Company has set out as its management vision. For Q1 to Q2 FY03/2025, sales have expanded to a record high due to acquisition of new transaction flows. In terms of earnings, however, the Company has seen gross profit margin being under pressure due to absence of windfall profit posted during the same period of the previous year, changes in sales mix and so on. Furthermore, the Company is stepping up its investment in human resources and systems with a view to achieving long-term growth, which has resulted in an increase in SG&A expenses and thus inevitably a decline at the operating level. During the period of the existing midterm management plan (FY03/2025 to FY03/2027), the Company aims to achieve structural reforms and establish a business foundation for a new stage of growth, implying it is currently essential to spend expenses to propel both of the policies to achieve the goal. In the short term, there have been unexpected production adjustments by auto-related customers and stagnant market conditions in China, having forced FY03/2025 Company forecasts revised down to a corresponding extent. From a long-term perspective, the Company is now looking to a major contribution to “improvement of earning power”, stemming from Data Platform realm recently launched.

INTERLIFE HOLDINGS, running operations of interior finish work as well as design and construction of sound & lighting facilities, is seeing a surging performance. The Company has successfully executed restructuring over the past several years, which has improved its profitability, while currently seeing a significant momentum in sales and thus a dominantly significant momentum in operating profit to benefit from higher sales, steadily capturing the uptick in construction-related demand. Consequently, the Company is now virtually seeing a changeover from negative value to positive value in its equity spread. Meanwhile, it appears that FY02/2025 Company forecasts, once already revised up, have a potential to be exceeded. The Company's priority issues for FY02/2025 are to “promote management with an awareness of the cost of capital and share price,” “strengthen profitability” and “develop new business, including one via M&A.” Currently, the Company is well making progress with all of those priority issues, which is to be followed by further focus on them for FY02/2026 and thereafter. On top of this, the Company is to focus also on investment in human capital, aiming to move to a new stage of growth.

MORESCO, running operations of R&D, manufacture and sale of chemical goods used in diverse applications with autos as the mainstay, promotes its 10th Midterm Management Plan (FY02/2025 to FY02/2027), centered on its commitment to MORESCO Green SX (MGS) Products, calling for CAGR of 6.0% in sales and 30.1% in operating profit during the relevant period, when setting the FY02/2024 results as the point of origin. Meanwhile, operating profit margin is to increase 3.3% points from 3.8% to 7.1%. The Company intends to improve its sales mix by enhancing sales of MGS products, which are considered to have relatively high added value and thus gross profit margin due to their contribution to reducing environmental impact and so on, looking to the above-mentioned steady increases in earnings. For Q1 to Q2 FY02/2025, sales of wastewater treatment equipment, which are certified as MGS products, expanded significantly, indicating that the Company is making steady progress in expanding sales of MGS products in line with assumptions of the Midterm Management Plan. The sales composition ratio of MGS products from FY02/2023 to FY02/2024 has increased from 29% to 33%, while the Company plans to achieve 40% for FY02/2027, the final year of the plan.

On 29 November 2024, Sanyo Homes, running operations of building houses on a contract basis and developing condos for sale, held its results briefing for Q1 to Q2 FY03/2025. It has been revealed that the Company saw gross profit margin of 20.3% (up 1.1% points YoY) despite sluggishness in sales. On the Housing Business side, which is responsible for building houses on a contract basis, the Company has begun benefiting from the impact of price revision in earnest, having resulted in gross profit margin of 20.6% (up 3.2% points). Meanwhile, on the Condos Business side, which is responsible for developing condos for sale, the Company saw gross profit margin of 19.9% (down 2.2% points). During the same period of the previous year, the Company posted sales of newly completed properties, carrying high gross profit margin, while the Company did not see any new properties completed for Q1 to Q2 FY03/2025. However, the Company has posted sales of properties already completed with gross profit margin rather higher than originally planned. More importantly, the Company is to post sales of properties newly completed as many as seven in the number of buildings for H2, which is to result in an increase in the Company’s sales and earnings on a full-year basis.

On 28 November 2024, KAGA ELECTRONICS, major electronic components trading company, held its on-the-web financial results briefing for Q1 to Q2 FY03/2025. It has been revealed that Midterm Management Plan 2027 (FY03/2026 to FY03/2028), released on 6 November 2024 together with the actual results, has detailed policy-related scenarios. The performance goals on an organic basis calls for lower limit of ¥700,000m in prospective sales and ¥35,000m in operating profit for FY03/2028, the final year of the plan, implying CAGR of 8.0% and 10.4%, respectively, when setting FY03/2025 Company forecasts as the point of origin. Meanwhile, the managerial goals for achieving sales of ¥1.0 trillion coming in sight calls for lower limit of ¥800,000 in prospective sales and ¥36,000m in operating profit as well as ROE of 12.0%, up 0.5% points from 11.5% for FY03/2025 Company forecasts. During the three-year period, the Company plans to generate cash of about ¥60,000m on a cumulative basis, which are to be allocated mainly to growth investments and shareholder returns. With respect to growth investments, including those of acquiring sector peer companies, the Company plans to allocate about ¥30,000m, while suggesting a possibility to raise the upper limit of the investment framework by utilizing debt financing when necessary. With respect to shareholder returns, the Company has newly set the target to achieve DOE of 4.0%, while going for payout ratio of 30% to 40%, up from the previous target of 25% to 35%, planning to allocate ¥22,000m to ¥30,000m on a cumulative basis during the relevant period.

On 14 November 2024, Fast Accounting, which advocates business reform through the use of accounting-specific AI, released its Q1 to Q3 (January to September) FY12/2024 results. It has been revealed that sales are persistently growing fast and are likely to continue doing so from a long-term perspective as well. The Company aims at achieving sales of \10,000m by FY12/2028. For Q1 to Q3 (January to September), sales have increased 41.0% over the same period of the previous year, while the Company calls for future CAGR of higher than 30% in sales related to the existing operations of Account Payable Automation. At the moment, the Company operates a SaaS business serving 135 client companies, including 106 large-sized ones acquired through a combination of direct sales and partner sales activities, which is rare in Japan, while seeing Average Revenue per Account (ARPA, i.e., MRR, divided by the number of client companies) of some ¥1.0m with a stability. The Company suggests that the number of large-sized companies stands at some 4,000 in Japan, when based on the concept of Service Available Market (SAM), implying a great room for further development. On top of this, the Company is to begin posting sales related to E2E (ERP to ERP) Process Realm from FY12/2025, which is based on a horizontal expansion of the existing Account Payable Automation. Then, this is to be followed by another one of Platform Realm from FY12/2026, resulting in a potential to achieve sales of \10,000m in the future, according to the Company.

On 14 November 2024, MUGEN ESTATE, running purchase and resale of pre-owned real estate mostly in the Tokyo metropolitan area, released its Q1 to Q3 (January to September) FY12/2024 results. It has been revealed that the Company continues to see a significant increase in sales and earnings. While the real estate market continues to boom, the Company's policy of focusing on expanding sales of high-priced properties, which are highly profitable, is succeeding, which results in a steady uptick trend of gross profit margin. It appears to be another important factor for the strengths of the Company’s performance that it steadily meets buoyant demand for investment-type properties from investors based in ex-Japan Asian counties such as China and Taiwan or so-called “inbound demand”, which is boosted by yen’s depreciation and so on. According to the Company, this trend is also applicable for residential-type properties as well. Thus, sales are expanding favorably, while the Company is increasingly purchasing properties, resulting in a high level ongoing for the balance of real estate for sale outstanding (inventory), which is the source for the Company to post sales for FY12/2025 and thereafter. The Company suggests that it reveals its prospective performance target for FY12/2025 and thereafter in the form of new midterm management plan when it releases the actual results for FY12/2024.

On 14 November 2024, EM SYSTEMS, which develops and sells IT systems of mission-critical tasks for pharmacies as the leader in Japan, released its Q1 to Q3 (January to September) FY12/2024 results and new midterm management plan (FY12/2025 to FY12/2027) at the same time. It has been revealed that recent trading is running ahead of assumptions made earlier, driven by rush demand associated with so-called welfare administration, having resulted in upward revision for full-year Company forecasts. In line with government policy, the Company is in charge of providing own customers using its IT systems for pharmacies with electronic prescription systems to be installed, while the demand is now picking up sharply. With the revision of medical service fees in June 2024, there was an addon newly set up to promote medical DX, which was followed by a notification for the administration to suspend subsidies related to adoption of the said systems as of the end of CY2024, resulting in the above-mentioned rush demand, according to the Company. Meanwhile, the Company expects this to increase the installation rate of the said systems amongst own customers to 70% to 75% as of the end of December 2024, while the Company will post sales for the remaining 25% to 30% from the beginning of FY12/2025. Under assumptions of the new midterm management plan, the Company’s sales are to inevitably suffer from a reversal of the above-mentioned acceleration from FY12/2024 to FY12/2025, even as a whole, consequently. More importantly, however, excluding the impact of all those developments related to the welfare administration, the Company is on track for sustained growth from a long-term perspective.

On 14 November 2024, YAMABIKO, which develops, manufactures and sells a variety of products belonging to Outdoor Power Equipment, Agricultural Machinery and Industrial Machinery, released its Q1 to Q3 (January to September) FY12/2024 results. It has been revealed that sales are stretching in the North American market, the mainstay by region, with respect to the Outdoor Power Equipment side. It appears that this is driven by increased sales volume and yen’s deprecation to a large extent. The Company posted sales of \70,897m (up 18.4% YoY) for Outdoor Power Equipment in the Americas, where those of the North American market are almost everything. As far as we could see, sales on a local currency basis have also risen, which are free from the changes in currency rates. According to the Company, this is due to the success of promotions for Q2 (April to June), including TV ads, as well as favorable weather conditions in the said market. By sales channel, sales were strong, especially to home centers. On the other hand, the Company has suffered from a decline in earnings on the Agricultural Machinery side as well as on the Industrial Machinery, but this only had a marginal impact on the Company’s earnings as a whole.

On 14 November 2024, TOW, which focuses on the development of planning & producing for sophisticatedly integrated promotions, released its Q1 (July to September) FY06/2025 results. It has been revealed that the Company is achieving steady progress in its performance in line with assumptions of Company forecasts. With respect to Integrated Promotions, on which the Company focuses, sales have risen more than 10% over the same period of the previous year, while sales have secured an increase for Real-World Events, which is currently the mainstay, due to strengths associated with street promotions and exhibitions for beverages and tasty things. At the same time, the Company is proactively implementing measures to strengthen human capital management for long-term growth and investing heavily in themes such as AI and environment. Further, on 31 October 2024, the Company disclosed that it had entered into a basic agreement to acquire all shares of Qetic Inc., a company involved in planning, producing and operating for a wide range of social media and digital content, eventually making it a consolidated subsidiary with an objective of strengthening Integrated Promotions. We are to interview the Company's management to obtain further details, so that we should be able to update our Company Report and release it afresh.

On 12 November 2024, NORITZ, mainly running operations to manufacture and sell gas water heaters & oil-fired boilers for private homes, released its Q1 to Q3 FY12/2024 (January to September) results. It has been revealed that the Company was forced to suffer from a deterioration in earnings due mainly to slowing sales volume, but it is more important that there was a changeover from a decrease to an increase on a year-on-year basis for sales volume in Japan during the period of Q3 (July to September), while such a trend is persisting for Q4 (October to December) and thus the Company is now going for a year-on-year increase in sales and earnings during the relevant period. With respect to foreign operations, the Company’s performance is negatively affected by unfavorable market conditions in China, but Company forecasts now assume a year-on-year increase in sales volume for Q4 (October to December). We are to have an interview with the management to obtain further details in order to update our Company Report and release afresh.

On 14 November 2024, Shinwa, which mainly manufactures, sells and constructs scaffoldings used at fields of construction work, released its Q1 to Q2 FY03/2025 results. It has been revealed that the Company is seeing revenue higher than assumptions of initial Company forecasts and thus earning higher as well, which is in line with upward revision made beforehand on 11 November. The Company states that it has seen shipment pushed forward for a large-scale construction project on the Scaffolding Equipment side as well as having acquired work to construct scaffoldings more than initially planned in YAGUMI Group (the largest scaffolding construction company in the Tokai region and one of the largest in Japan), which has been a subsidiary of the Company since the beginning of the period. Further, the Company has seen revenue higher on the Logistics Equipment side at the same time. We are to attend the Company’s financial results briefing on the web, scheduled for Monday, 25 November, which will be followed by our interview with the management, so that we should be able to update our Company Report and release it afresh in due course.

On 31 October 2024, DAIKEN MEDICAL, running operations to develop, manufacture and sell medical devices mainly used for prevention of hospital-acquired infections and postoperative pain control, released its Q1 to Q2 FY03/2025 results. It has been revealed that capital efficiency is on the rise. According to our estimates, ROE of 15.1% has been achieved over the past 12 months (versus 14.6% for the actual results of FY03/2024). The background to this is that the Company has continued to pay out dividend equivalent to over 60% in terms of payout ratio for the past five years and more, while having seen a steady increase in earnings for Q1 to Q2 due mainly to increased sales of midterm strategic products, i.e., QinPot and COOPDECH AMY PCA. On the other hand, the Company has disclosed that the time for COOPDECH AMY PCA to be launched in overseas markets is to be delayed and thus that of sales expansion as well. The Company, which is prioritizing a spread in Europe, is working to obtain certification of MDR (Medical Device Regulation), which is essential for launching the product in Europe, while having just stated that it is now unlikely to do so by the end of FY03/2025 as in the original agenda. The Company is to respond to questions and other inquiries about the current situation at the financial results briefing scheduled for Tuesday, 10 December 2024.