Message from the President

Thank you as always for your continued support.

“We, in response to the Trust in our business, will keep creating new value that contributes to the creation of the positive space and environment for the people in the world.” Based on this management philosophy, the TOLI Group aims to be a corporate group that contributes to the development of lifestyle culture and economy, and the preservation of the global environment through the interior design business.

the Group is pursuing the five priority strategies under the Medium-Term Business Plan from FY2021 to FY2024 “SHINKA Plus ONE” (A. Reinforcement of core businesses, B. Expanding the growth of promising business, C. Creation of a fifth business, D. Enhancement of capabilities across the Group, and E. Building a business base that supports growth), toward the realization of our Long-Term Vision <TOLI VISION 2030>.

In the fiscal year under review, we have made further progress in important capital investment projects, which form the core of SHINKA Plus ONE, and have steadily achieved results in reducing manufacturing costs, establishing a stable supply system, and reducing environmental impact. In particular, we promoted measures to improve profitability, such as improving the productivity of our main products in the new No.3 line of the Hiroka TOLI Floor, expanding the use of carpet tiles made of nylon yarn, and significantly increasing recycling capacity through the completion of the No.2 recycling plant for carpet tiles.

Looking ahead, while a gradual recovery of the domestic economy is expected, the outlook remains uncertain as the impact of supply constraint risks caused by the upward pressure on prices as well as labor shortage and the impact of the trends in the financial market on the society as a whole is significant. In the TOLI Group‘s business environment, there are concerns that the cost of raw materials which remain high and the rising of logistics cost due to the 2024 problem, which places restrictions on working hours of truck drivers, will put pressure on earnings as construction starts remain stagnant.

In the fiscal year ending March 2025, the final year of the Medium-Term Business Plan “SHINKA Plus ONE,” we will strive to achieve consolidated net sales of 100 billion yen and more and consolidated operating income of 4 billion yen and more, both of which are the medium-term management indicators, by completing all of our priority strategies. In particular, we will promote the development of highly unique new products and the reduction of manufacturing costs by utilizing the Hiroka TOLI Floor’s new No.3 line and nylon spinning equipment for carpets to strengthen product competitiveness in the market. In addition, we will make further capital investments in the carpet tile recycling plant to strengthen our business activities that contribute to the realization of a sustainable society, such as the expansion of environmentally friendly products and the reduction of industrial
waste in order to create a recycling-based society. On the other hand, in the fiscal year ending March 2025, costs will increase due partly to an increase in depreciation as a result of progress in large-scale capital investment aimed at reducing costs. In addition, we expect an increase in SG&A expenses, such as a rise in promotion expenses including sample books and an increase in human capital investment including pay raise, in the year of the launch of new products and the large-scale revision and abolition of existing products.

As rapid changes accelerate on a global basis, we will take on new challenges as a corporate group that is worthy of bearing people’s expectations and trust.

We look forward to the continued support and encouragement of our shareholders and investors.