Notice Regarding Formulation of Medium-Term Management Plan (Fiscal Years Ending March 2027 to March 2029)

Overview of the Medium-Term Management Plan

CTS Corporation has formulated a three-year medium-term management plan covering fiscal years ending March 2027 through March 2029. Under this plan, the company aims to transform into a specialized construction ICT company by focusing on the widespread adoption of SAP and the implementation of AI to improve sales productivity. The target for net sales in fiscal 2029 is 16 billion yen (a 25% increase compared to fiscal 2026), operating income of 4.4 billion yen (a 30% increase), and an ROE exceeding 20%. The SAP business aims for net sales of 5.5 billion yen (a 96% increase), while growth in the DDS business is also emphasized.

Review of the Previous Medium-Term Management Plan and Future Policy

The previous medium-term management plan (fiscal years ending March 2024 to March 2026) achieved results close to targets with net sales of 12.747 billion yen and operating income of 3.369 billion yen; however, transformation to a SAP-centric business was not accomplished. On the other hand, improvements in sales productivity through expanded BtoB transactions and enhanced profitability of the SMS business were positively recognized. Moving forward, the company will promote competitiveness in the construction market by integrating SAP with AI, develop the government and public sector market, and pursue new market development while continuing a progressive dividend policy.