As a corporate group that contributes to a sustainable society, the Carlit Group will continue to meet new challenges as a united team.
I would like to take this opportunity to thank our shareholders for your ongoing support.The Group's fiscal year 2022 (April 1, 2022 to March 31, 2023) has come to an end, and so we are reporting here an overview of our financial results and our planned development of operations going forward.
Review of operations for the fiscal year ending March 31, 2023
In the fiscal year ended March 31, 2023, net sales were ¥36,008 million, operating profit was ¥2,640 million, ordinary profit was ¥2,910 million, and profit attributable to owners of parent was ¥2,246 million.This was due to raw material prices and energy costs skyrocketed but consolidated net sales were brisk in mainly the chemical products business segment (chemicals, material assessment service, ceramics) and the industrial materials business segment (anchors for refractories, various metal spring and pressed products).In the chemical products business segment, despite the impacts of demand for PC declines in the electronic materials field, signal flares for highway in the explosive products field, sodium chlorate (for pulp bleaching) and ammonium perchlorate (the raw material in propellants for rockets and defense missiles) in the chemicals field performed well.Also, sales and profit increased for in the industrial materials business segment, despite the impacts of demand for weak demand stemming from China lockdown in the silicon wafers, heat-resistant metal parts for furnace centered on demand from urban garbage incineration and for various metal spring and pressed products performed well of construction machinery. Furthermore, we recorded extraordinary income of ¥424 million from gain on the sale of investment securities.
And extraordinary losses of \82 million from loss on the sale of shares of subsidiaries and associated in connection with the sales of some group companies.
Consolidated Financial Highlights (Millions of yen)
-
-
Net sales
-
36,008
(+6.2％ YoY)
-
-
-
Operating profit
-
2,640
(+5.3％ YoY)
-
-
-
Ordinary profit
-
2,910
(+6.1％ YoY)
-
-
-
Profit attributable
to owners of parent -
2,246
(-3.8％ YoY)
-
Forecasts for the fiscal year ending March 31, 2024
In the chemical products business segment, despite weakening demand for electronic equipment materials owing to impacts from the Chinese economy, we expect economic growth in Japan to drive brisk sales of products for automotive applications and basic chemical products. For the bottling business segment, we forecast sales and profit growth on the back of increased domestic consumption of beverages due to a recovery in inbound tourist demand. For the industrial materials and engineering services business segments, we forecast solid results in line with the fortunes of the Japanese economy.
Forecasts of consolidated financial results for the fiscal year ending March 31, 2024 (Millions of yen)
*This table can be scrolled horizontally.
| Net sales | Operating profit | Ordinary profit | Profit attributable to owners of parent | |
|---|---|---|---|---|
| 1st half | 18,000 | 800 | 900 | 750 |
| Full year | 38,000 | 2,700 | 2,900 | 2,300 |
The Carlit Group has formulated the Mid-Term Management Plan "Challenge 2024 Rolling Plan 2023," and will promote various initiatives to become a company that is highly valued by the market.
Future Initiatives
Medium- to Long-term Management Vision
Based on the Group's management philosophy of "For Confidence and Infinite Challenges," and looking ahead to the long term, we have determined our Vision for 2030: "Supporting happy lifestyles by combining the power of 'chemicals' and 'technology' to contribute to a sustainable society." In addition, we have introduced new business portfolio management, dividing our business portfolio into three areas: Focus Areas, Develop Areas, and Base Areas, and promoting strategies appropriate to each area, with the aim of achieving "profitable growth."
In order to realize this vision, the Group has formulated a Mid-Term Management Plan entitled "Challenge 2024," which kicked off in fiscal year 2022. Our management policy is to pursue improvements in corporate value through the optimization of our business portfolio. In line with this policy, we are currently undertaking specific measures centered on the following five strategies: (1) accelerating growth businesses; (2) expanding research and development; (3) improving the profitability of existing businesses; (4) improving ESG management; and (5) rebuilding business infrastructure. We are further enhancing our social contributions and corporate governance, thus giving tangible shape to profitable growth and ESG, while aiming to become a corporate group that is trusted by society.
Mid-Term Management Plan "Challenge 2024 Rolling Plan 2023"
Based on changes in the business environment in 2022, which was the first year of the Mid-Term Management Plan, as well as recent performance trends, we have formulated the Mid-Term Management Plan "Challenge 2024 Rolling Plan 2023." While there are no major changes to our basic policies and strategies, we will promote strategies that will be valued by the market, with a strong focus on improving PBR under the Rolling Plan 2023. We have added specific measures to increase ROE and PER, with the aim of improving PBR.
In terms of measures targeting ROE, we aim to achieve an operating margin of 3% or more, and will also review the management of cash and assets held by the Group, with an even greater awareness of return on capital.
In terms of measures targeting PER, we will consider reducing the cost of capital through both financial and non-financial initiatives, as well as promoting growth strategies. In addition to promoting the development of R&D bases and plant innovations, which is also a goal of Challenge 2024, we will strengthen our non-financial initiatives such as human capital investment and personnel system reforms. Furthermore, we are also working to enhance our IR and SR information dissemination while narrowing our targets and offering useful information, ensuring that a wider range of people have a better understanding of our appeal.
When the Challenge 2024 Rolling Plan 2023 has been accomplished, we will consider further updated themes based on the concept of dividing the newly increased "3% profit" into "three equal parts." Based on our business portfolio management, we will make Carlit Holdings an even more dynamic Group, and realize our Vision for 2030 by investing and returning 1% to investment in areas of focus and development, 1% to shareholder returns, and 1% to employee returns, respectively, in addition to our current plan.
To Our Shareholders
Starting from the electrolysis technology for salt water, we have supported Japanese industry for a long time. In addition, whenever the industrial structure of Japan has changed, we have striven hard and developed various businesses based on the philosophy of our founder,"always rise up after repeated setbacks." Even today, companies need to adapt to various challenges, such as business activities and internal institutional reforms. The Carlit Group will continue to work as one, with myself leading the way, toward the realization of our Vision for 2030.
We sincerely appreciate the continued support of Carlit Holdings shareholders.