The prolonged COVID-19 pandemic finally drew to a close in 1H FY12/2023, but at the start of the fiscal year we still expected the business climate to be just as, or even more challenging than in FY12/2022 amid elevated resource and raw material prices and rising inflation. However, overall, earnings exceeded our forecasts.
In the audio equipment/peripherals business, we struggled to meet demand in a timely manner due to problems with parts procurement and long lead times in logistics. However, supplies began to normalize and demand remained robust, supporting solid earnings. Growth was sluggish in the parts/materials business in both Japan and overseas amid market contraction and production adjustments at customers, leading to a drop in sales. However, this was offset by the solid performance in the audio equipment/peripherals business, lifting consolidated revenue 31.5% year on year to ¥41,469 million. Net profit exceeded guidance, but declined year on year due to the absence of gains on share sales and gains on foreign currency-denominated receivables booked in the previous fiscal year.
In the audio equipment/peripherals business, subsidiary AlphaTheta Corporation announced an agreement to acquire all outstanding shares in Serato Audio Research Ltd. (Serato), which develops and sells audio software, primarily for DJs and music production.
The acquisition will reinforce the already solid partnership between the two brands, paving the way for Serato and AlphaTheta to provide the best possible experience for DJs and customers worldwide by bringing together their respective strengths in music and technology.
This news capped off a generally positive first half, with the Company making progress on reinforcing existing Group businesses and investing in growth fields – one of the key strategies in Medium-Term Management Plan FY25. Each of our three business segments faces issues that need to be addressed, but Group companies have already developed responses and are now actively working to take their businesses to the next level.
All Group companies are committed to working together to achieve the targets in the current Medium-Term Management Plan and our vision of “a corporate group that continues to create ‘No.1/Only 1’ businesses.”
I hope we can count on your continued support as the Noritsu Koki Group strives to realize this vision through sustained growth.