Operating results for the year ended March 31, 2017

The economy in Japan showed some positive trends in investment in plant and equipment and corporate earning driven by economic policy by the government and monetary easing policy by the Bank of Japan, however, it remained uncertain because of sluggish personal consumption and uncertainty of the world economy due to the direction of economic policy of the United States after the change of the administration and withdrawal of the UK from EU as well as moderate slowdown of economies in China and other Asian countries. Sales to manufacturing industries In the manufacturing industries, demand for ZK Premium, ionized alkaline water generator, is steadily increasing as a machine that can reduce environmental load, and it contributed to growth of sales of scrubber machines and high pressure washers.
Sales to building service contractors Besides ZK Premium which has been popular among building service contractors, Vulture Orbital, high rpm orbital floor cleaning machine was launched last year and promoted via exhibitions and seminars throughout Japan and various maintenance methods were proposed. As a result, sales of other related machines were also favorable. OEM supply New models of small steam machines were introduced and other new products were added to online sales, DIY store and consumer market to expand sales channels and market share. Sales from after sales services
In addition to the sales of periodic maintenance contracts, sales of labor and parts were remained steady by focusing on prompt services. Etani Sangyo (subsidiary company) Sales increased due to positive sales of clarifier chemical for swimming pool.
As a result, consolidated sales as a group for the last fiscal year increased to 6,944 Million Yen.
Total sales growth was 1.6% from previous year.
Operating income and recurring income increased to 1,073 Million Yen (up by 4.3% from previous year) and 1,115 Million Yen (up by 5.1% from previous year) respectively.
Net income increased to 761 Million Yen (up by 15.9% from previous year).

Outlook for this year

Employment environment and investment in plant and equipment in the Japanese market are expected to moderately recover but personal consumption has not been improved as expected.
Also, world economy would be exposed to downturn risk depending on the results of political events in European countries, situations in Middle East and East Asia and economic policies of the new administration of the United States, and economic situation in Japan seems to be still uncertain and unpredictable. Under these circumstances, we will continue to study to develop new products with new features and new applications that can satisfy market needs.
Also we will hold seminars at our branch offices and dealers throughout Japan to strengthen the sales to existing customers.
Furthermore, we will strive to gain new customers by promoting products through various exhibitions. For OEM business, we will try to expand the business by introducing additional products other than small steam machines that is one of main products and also by offering new accessories. With regard to after sales services, we will continue to make effort to improve quality of services and skills of service technicians.
We also focus on customer oriented services and propose quotation for recommended repair to prolong product life. As for Etani Sangyo, we will work hard to explore new sales channels by adding new products and using our strength of group in trading.