Ichiro Hikage
President

We would like to express our sincere gratitude to our shareholders for their continued support. We are pleased to present the report for the 106th fiscal year of the Achilles Group.

During the consolidated fiscal year under review, the global economy remained solid in the United States, supported by resilient personal consumption and capital investment, particularly in areas related to generative AI. In Europe, a moderate recovery was seen, backed by wage increases and stable prices. In China, however, the pace of economic recovery remained slow due to sluggish personal consumption and the prolonged downturn in the real estate market.

In Japan, the outlook remained uncertain due to persistently high raw material prices and energy costs, fluctuations in foreign exchange rates, the impact of U.S. trade policies, and heightened tensions in the Middle East.

Under these business conditions, the Achilles Group formulated its Mid-Term Management Plan -FY25–FY27-, which sets out the direction for the three-year period toward achieving its long-term goal of becoming a “Global Solution Provider” that enriches people’s lives by enabling the world to experience surprise, joy, and inspiration.

At the Achilles Group, we value the curiosity, diverse abilities, unique ideas, and inspiration of each of our employees, and aim to contribute to society through solutions created by combining various technologies. Based on our three company-wide strategies — (1) Thorough Selection and Concentration of Businesses, (2) Creation of New Value, and (3) Promotion of Our Global Strategy — we have worked to enhance our business foundation, including human resource capabilities, productivity, and technological capabilities, while promoting sustainability management and rebuilding and enhancing profitability.

As a result, consolidated net sales for the fiscal year under review amounted to 81,802 million yen, up 3.4% year on year. Operating profit was 2,972 million yen, compared with an operating loss of 436 million yen in the previous fiscal year. Ordinary profit was 3,919 million yen, compared with an ordinary loss of 220 million yen in the previous fiscal year. Profit attributable to owners of parent was 2,116 million yen, up 394.7% year on year.

At present, there are concerns regarding the impact of heightened tensions in the Middle East on the procurement environment for crude oil and naphtha, as well as rising energy prices, higher logistics costs, supply chain disruptions, and significant fluctuations in foreign exchange rates. We therefore expect the business environment to remain highly uncertain. As the Achilles Group manufactures and sells products using plastics derived from naphtha as raw materials, these developments may affect raw material procurement, raw material prices, and manufacturing activities.

Under these circumstances, to minimize the impact on raw material procurement, the Achilles Group is working with suppliers, including exploring alternative sourcing options. In response to rising raw material prices and energy and logistics costs, we will continue to closely monitor trends in the global economy and related markets, while striving to secure profits through cost-reduction activities and appropriate price revisions.

Through the Mid-Term Management Plan -FY25–FY27-, the Achilles Group will continue striving to enhance corporate value and achieve sustainable growth, while making every effort to minimize the impact of heightened tensions in the Middle East on its business operations. We respectfully ask our shareholders for their continued support.

June 2026