■Seed ＜7743＞ Medium-Term Management Plan

The company has formulated a new medium-term management plan with the goal of “achieving consolidated sales of 50,000 million yen and securing a production base to demonstrate presence in the global contact lens market.” As management targets, we have set sales of 41000 million yen, operating income of 2800 million yen, operating profit margin of 6.8%, EBITDA6020 million yen, and ROE of 10.7% for the fiscal year ending 2027/3. By improving the profit structure, we will solidify our foothold to achieve consolidated sales of 50,000 million yen by continuing to increase profit on an operating income basis. The domestic contact lens market is expected to recover from the COVID-19 pandemic and continue to grow again, and they are planning to expand sales of existing products and introduce new products against the backdrop of increased productivity. In the company's medium-term management plan, growth strategies such as increasing productivity, responding to multi-product small-lot production, and strengthening domestic and international logistic services are clearly set out, and we believe that there are high expectations for achieving sustainable growth by strengthening competitiveness.

1. Positioning and main measures

The company aims to achieve consolidated sales of 50,000 million yen with the goal of securing a production base to demonstrate its presence in the global contact lens market. In order to make up for the lack of product supply capacity, which is holding back sales and business expansion, we will actively invest in equipment and develop production capacity that is comparable to the world. Furthermore, we aim to build a production system that can realize labor-saving production and maintain competitiveness. Furthermore, promoting quality improvement and pursuing safety and security are also important goals. Improvements in corporate value through corporate brand restructuring and promotion of environmental management are also included in the plan. Establishing a business infrastructure through strengthening human resources is also one of the important measures.

As a main policy, we will pursue the provision of safe, high-quality products and services through pride in “Made in Nippon” and “Japan Quality.” We aim to strengthen profitability through a drastic increase in productivity, and strengthen and provide services corresponding to domestic and international markets. In addition, promoting manufacturing in line with market needs, strengthening the internal infrastructure, and securing and developing human resources are also important measures. The promotion of SDGs and stable shareholder returns are also listed as major policies.

2. Growth Strategy

(1) Strengthening profitability through drastic increases in productivity

We aim to strengthen profitability through a drastic increase in productivity. First, plans are underway to improve productivity through labor-saving investments and expand production capacity by constructing new manufacturing facilities. Specifically, with the addition of the building 2 annex, which was completed in 2024/4 and full-scale operation began in October, it has a monthly production capacity of 65 million sheets, including existing buildings 1 to 3 and 2 annexes. Furthermore, construction of the new manufacturing facility Building 4 began in 2024/11, and progress is being made towards completion in 2026/1. Initially, in the first phase plan for Building 4, it was planned to increase the number of sheets produced per month by 10 million sheets, but with a view to ensuring stability in product supply and realizing a growth strategy, the policy was changed to expand the number of sheets produced per month to 14 million sheets. Furthermore, processing capacity was strengthened and equipment specifications were reviewed with the aim of responding to future market expansion and product diversification, and as a result, the total investment amount increased from the original plan of 13.1 billion yen to 17.3 billion yen. With the completion of this first phase plan, the company's production capacity is expected to be raised from the current monthly production of 65 million sheets to a monthly production of 79 million sheets. When designing a new manufacturing facility, in order to construct an extremely high level of labor-saving production system, not only the equipment to be introduced, but also a factory design that assumes labor saving from the building is carried out. By introducing AI, automated operation of manufacturing and inspection processes is realized, and the latest line know-how is deployed horizontally to existing lines, further labor saving will be promoted, and production capacity will be improved.

Furthermore, by utilizing production lines within the group, further improvements in production capacity are realized, and local contract production, including group companies, is being diversified for overseas markets. We are also working to improve profit margins through cost reduction, improving yield by improving manufacturing processes, and improving overall equipment utilization rates through labor savings. Measures are also being implemented to reduce energy costs by introducing energy-saving equipment. Furthermore, we are expanding support for multi-product small-lot production, and we aim to improve production efficiency of products for overseas markets and contact lenses for astigmatism by expanding production lines that meet diverse needs. By promoting commercialization of special lenses and optimization of contract production for OEM products, we are trying to achieve further improvements in productivity and reduction of waste loss.

(2) Enhancing and providing services for domestic and international markets

It places importance on strengthening services corresponding to domestic and international markets, and aims to disseminate the meaning of the company's existence, build a corporate brand that is sympathized with by various stakeholders, and increase the value of the enterprise itself. As a result of this initiative, corporate awareness and image have been raised, and an approach to society as a whole is being implemented. Furthermore, by creating users who have sympathy for the company, sales are facilitated, and improvements in labor productivity and service levels have been realized by strengthening internal engagement.

We are also working to expand sales and delivery services that are conscious of “B to B to C,” and are constructing a new service with the online ordering system “Easy Raku System.” A new regular and flat-rate service has been released, and the development and operation of dedicated management software associated with it has begun, and coupling services with care products are also being developed. Furthermore, the strengthening of domestic and international logistics services is also being promoted, and by establishing a system to unify domestic and international inventory management, synchronization of inventory status is realized, and sales opportunities and inventory loss are being reduced. Production management, inventory management, and domestic and international order management have been enhanced, and last-mile services are also being strengthened and improved. Furthermore, promoting eco-friendly 96-sheet packs is also positioned as an important initiative. In addition, educational tools for facilities compatible with each country have also been created, and tools are being created and distributed in line with the regulations of each country for the safe and secure use of the company's products. Through these initiatives, we aim to strengthen competitiveness and achieve sustainable growth in domestic and international markets.

(Written by FISCO Guest Analyst Ryoji Mogi)