■Future outlook

● Earnings forecast for the fiscal year ending 2025/3

Regarding consolidated financial results for the fiscal year ending 2025/3, Mitsui Matsushima Holdings (1518) anticipates sales down 27.7% from the previous fiscal year to 56,000 million yen, operating income down 80.5% to 4,900 million yen, ordinary income down 81.5% to 4,800 million yen, and net income attributable to parent company shareholders to decrease 81.5% to 2,800 million yen. Although a decrease in sales and profit is expected in response to the end of the coal-related business in the previous fiscal year, it is expected that lifestyle-related businesses that the company has established as a new profit base will continue to maintain strong sales.

Earnings forecasts by segment are as follows.

(1) Lifestyle-related businesses

MOS, Catan, and Meiko Shokai are expected to take the lead, and Nippon Straw's performance is also expected to remain steady. Japan Chain Holdings' contribution throughout the year will also boost business results. As a result, sales are expected to increase 33.6% from the previous fiscal year to 55,000 million yen, and segment profit is expected to increase 68.9% from the same period to 4,700 million yen. The main business outlook is as follows.

a) Nippon Straws

Amid the major social trend of shifting to environmentally friendly material straws, it is expected that both sales and profits will remain steady. We will continue to focus on increasing market share by focusing on expanding sales of marine biodegradable straws that make use of our strengths. Currently, it is planned to acquire new suppliers in the convenience store industry. This is also a positive factor for expanding business performance.

b) Meiko Shokai

Continued strong performance is expected. Although there is cost pressure such as soaring raw materials, profits will be accumulated by utilizing sales power and focusing on sales of high-profit products.

c) KMT

The top line is expected to show a steady trend. Although there are uncertainties such as rising raw material prices and exchange rates, it is a policy to absorb cost increases by implementing price increases. Furthermore, we will continue to work on exports to China and Hong Kong, China. Local demand for high-quality pet food definitely exists, and sales in overseas businesses are expected to increase as bottlenecks in the external environment are resolved.

d) Systec KYOWA

Although the outlook for the external environment continues to be grim, it is expected that the effects of developing new customers implemented in the previous fiscal year will become apparent. We will continue to focus on increasing our share. Furthermore, while the newly built detached house market is weak, it is a policy to actively search for new markets where technological advantages can be utilized, and the decline in existing markets will be compensated by developing new markets.

e) MOS

The business environment is expected to continue to be good, with the penetration of cashless payments and an increase in inbound traffic due to the depreciation of the yen. Under such circumstances, in addition to growth in existing businesses, business transfers from Katsumata are also expected to be a positive factor in business results.

f) CST

While the semiconductor market is expected to recover, it is expected that cost reforms implemented in the fiscal year ending 2024/3 will continue to contribute to the company's performance. Expansion of the top line can also be expected, and it is a policy to increase profitability and accumulate profits.

g) Sansei Electronics

As for the Chinese market, although sluggish due to sluggish demand due to the real estate recession, demand for cutting-edge crystal device manufacturing equipment is expected to increase in Taiwan, China in addition to within Japan. Also, it seems that Saunders & Associates, which has become a consolidated subsidiary, can also be expected to contribute to business results. It is said that there are also new customers that can be acquired by becoming a subsidiary of Sansei Electronics. It is expected that Sansei Electronics' business performance will expand due to the acquisition of new suppliers.

h) Japan Catan

Continued strong performance is expected. Since the performance of electric power companies that are customers is currently doing well, it is expected that inquiries about both new and maintenance will increase. Additionally, it is expected that orders from customers will be leveled, and it is expected that profitability will also stabilize at a high level.

i) Plus One Techno

It boasts top market share in the niche market called the metering area in commas where major metering equipment companies do not enter, using high technical capabilities as weapons, and aims to further expand business performance by utilizing the management know-how and capital power possessed by the company group.

j) Japan Chain Holdings

By injecting management know-how possessed by the company group, further efficiency improvements in production activities, etc. are realized, and profitability is improved. Furthermore, the US economy is steadily expanding, and we will surely take in the country's growth and expand business performance.

(2) Energy business

Regarding this business, it is expected that the scale of the business will shrink drastically due to the termination of coal-related businesses. Sales are expected to decrease 99.1% from the previous fiscal year to 300 million yen due to revenue from the renewable energy sector, etc., and segment profit is expected to decrease 99.6% to 100 million yen.

(Written by FISCO Visiting Analyst Yoichiro Shimizu)