sangetsu

sangetsu

forBusiness

Of the issues related to the status of our business operations and to the conditions of our finances, as described in our financial report, the following items may potentially have a significant bearing on decisions made by investors.

Further, the items in the descriptions that relate to future events are based on estimates made by our corporate group at the end of the current fiscal year for consolidated accounting.

Business Environment

Our corporate group is engaged in an interior decoration business, which primarily covers the sale of interior decoration products, such as wall materials, curtains, and flooring materials, an exterior business, which primarily covers involves the sale of exterior products, such as gates, fencing and terraces, and a lighting equipment business.

The impact of fluctuations in building demand, relating to the number of new residential housing constructions, residential renovations, and commercial and public facilities in the area of non-residential buildings, is significant to these businesses. Changes in the residential policies or tax systems, as well as deterioration in market conditions, can potentially have an impact on the management performance of our corporate group.

Fluctuations in Stocking Costs

Many products handled by our corporate group use petrochemicals, aluminum and glass as raw materials. The management performance of our corporate group can potentially be affected by unexpected changes in the cost of products, due to rising oil and mineral prices.

Fluctuations in Management Performance

Demand for products handled by our corporate group tend to be higher towards the end of each year and each fiscal year with regard to the materials used in renovations for building contracts for residential houses, condominiums, and commercial spaces. The sales of our corporate group, therefore, also tend to be higher in the months of November, December, and March, in comparison with other months.