To our shareholders and investors

Hiroshi Geshiro, President and CEO

We would like to begin this message by expressing gratitude to our shareholders and investors for their ongoing support.

1. Operating and financial review

During the first half of the fiscal year (from April 1, 2023 to September 30, 2023), the global economic outlook remained uncertain mainly due to global inflation, rising interest rates, and a slowdown in the Chinese economy.

The business environment surrounding the Daifuku Group has seen an accelerating investment in the shift to electric vehicles in the automotive industry. In addition, investment in automation at airports has grown in line with the recovery in the number of air passengers. On the other hand, e-commerce-related investments, which had been at high levels in recent years, have entered a temporary lull. In addition, investment in the semiconductor industry has been restrained, with the exception of legacy semiconductors in China.

In this economic and business environment, orders received during the first half of the fiscal year under review declined significantly, mainly given a reactionary fall in cleanroom systems for semiconductor and flat-panel display production lines from the orders received ahead of schedule in the previous fiscal year.

Sales were strong in automotive systems and airport systems, benefiting from an extensive order backlog from the end of the previous fiscal year, while sales of intralogistics systems for manufacturers and distributors and cleanroom systems fell short of the results of a year ago.

Specifically, the Group received orders of 294,302 million yen, down 26.4% from the same period of the previous fiscal year, and recorded sales of 281,267 million yen, up 1.3%. Sales reached a new record high for the first half of the fiscal year.

Income reflected decreased sales of intralogistics systems and soaring raw material and labor costs.

Consequently, the Group posted operating income of 19,060 million yen, down 22.1% from the same period of the previous fiscal year, and ordinary income of 20,838 million yen, down 16.3%. Net income attributable to shareholders of the parent company was 14,206 million yen, down 16.5%.

2. Outlook for the fiscal year ending March 31, 2024

  Year ended March 2023 Year ending March 2024 (forecast) Y/Y rate
Orders received 737.4 billion yen 630.0 billion yen down 14.6%
Net sales 601.9 billion yen 605.0 billion yen up 0.5%
Operating income 58.8 billion yen 54.5 billion yen down 7.4%
Ordinary income 59.7 billion yen 55.5 billion yen down 7.1%
Net income attributable to shareholders of the parent company 41.2 billion yen 40.5 billion yen down 1.8%

The above forecast values are our projections based on information available at the time of this release and contain various uncertainties. Actual results may differ materially from forecast values due to factors such as changes in the business performance of the Company.

3. Basic policy for dividends

Daifuku regards the return of profits to shareholders as its most important management task and has adopted a performance-based policy for cash dividends based on consolidated net income, with the aim of achieving additional profit distribution to shareholders. We appropriate the remaining surplus to internal reserves for future growth.

As part of our Value Transformation 2023 three-year business plan that began in April 2021, we aim to increase corporate value by investing in growth and achieve a consolidated payout ratio of 30% or higher.

We respectfully ask our shareholders and investors for their continued support.

November 2023
Hiroshi Geshiro, President and CEO


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