On 6 August 2021, PUNCH INDUSTRY, manufacturing and selling parts of molds & dies in Japan and overseas, released its Q1 FY03/2022 results. It has been revealed that sales are increasing more significantly than initially expected in terms of changes over the same period of the previous year, having resulted in FY03/2022 Company forecasts being revised up. First of all, this is attributable to a conspicuous recovery of demand in China. The Company suggests that order intake is so firm in particular for the domains associated with electronic components, semiconductors and medical equipment. However, assumptions for H2 have remained unchanged. In other words, the Company has been assuming that the fears of economic slowdown cannot be dispelled for H2 in light of risk associated with re-expansion of COVID-19 and geopolitical risk such as resurgence of trade friction between the United States and China. FY03/2022 Company forecasts have been revised up by ¥900m (2.5%) for sales and by ¥350m (15.9%) for operating profit. With respect to operating profit, full-year Company forecasts have been revised up by as much as the amount of upward revision for Q1 to Q2 and thus prospective operating profit for H2 has remained unchanged.

On 11 August 2021, Japan Living Warranty, which advocates “Putting 100-year Value into all Homes”, released its FY06/2021 results. It has been revealed that surging sales and earnings resulted in renewal of record high performance. The Company provides warranty services for various facilities, etc. related to housings through collaboration with partner non-life insurance company, seeing consistently increased balance outstanding of policy on the Total Housing Maintenance side for operators of housing business as well as massively cultivating new markets on the BPO side for manufacturers of facilities. Meanwhile, the Company aims at “realizing a move to next phase with the 5 pillars for growth” from a long-term perspective. In other words, the Company plans to see persistent growth by means of actively investing in the development of new schemes and/or sales promotions of new services. For example, the Company announced that it had started providing Asset Value Warranty Program on 30 June 2021. With technology of warranty, e-money and AI scoring all being crossed, the Company is trying to get at improvement of asset value of wooden detaching housings, while revealing its intention to aggressively propel sales of such services for FY06/2022. We are to have an online interview with management in order to discuss the issues more in depth, so that we should be able to launch our Company report to be extensively distributed.

On 12 August 2021, Shinwa, mainly manufacturing and selling system scaffoldings, released its Q1 FY03/2022 results. It has been revealed that the Company is seeing substantially increased sales and earnings, being able to steadily capture recovery of demand driven by upbeat in business condition. The mainstay system scaffoldings are seeing revenue increased by almost 50% over the same period of the previous year, while safety measure equipment, which has high added value and thus high gross profit margin, is increasingly adopted for system scaffoldings, which looks compensating for pressure on earnings stemming from soaring steel prices. Meanwhile, so far in Q2 (July to September), the Company has revised unit selling prices of system scaffoldings and other products in line with steep rise in steel prices, which is expected to make full-year Company forecasts almost immune to the impacts stemming from here. Elsewhere, the Company, being keen on returning earnings to shareholders, announced that it had completed repurchase of own shares (380,000 shares or ¥299m) on 31 May 2021. When based on Company forecasts and prospective annual dividend of ¥32.0 per share, implying payout ratio of 40.0%, we estimate that total return ratio would be 65.5% = (¥32.00 × 13.7m shares + \299m) ÷ ¥1,128m for FY03/2022.