Fiscal Year Ending February 2027 Q2 (Interim) Financial Summary [Japanese GAAP] (Consolidated)

Business Performance Overview

Zuiko Corporation promoted proposals for sanitary product machinery domestically and internationally and expanded its cotton spunlace business during the interim, resulting in year-on-year sales growth. However, a significant decrease in shipments from Zuiko (Shanghai) Electrical Equipment Co., Ltd. caused operating and ordinary losses. By segment, sanitary product manufacturing machinery recorded lower sales and losses, while the cotton spunlace segment reported net sales of 2,089 million yen and segment profit of 3 million yen, remaining flat. The full-year outlook assumes net sales of 27,000 million yen and operating income of 1,780 million yen, but substantial profit growth in the second half is required relative to first-half results.

Outlook and Impact on Shareholders

Order backlog stands at 18,778 million yen at a high level, requiring significant additional revenue to realize in the second half. Cost increases due to delivery delays of high value-added products are expected to converge, and the company aims to improve margins through reductions in manufacturing costs and selling, general and administrative expenses. Attention should be paid to treasury stock movements and capital structure at the end of the interim period, as changes in capital policy may affect financials.