Our company’s consolidated results for the first half of the fiscal year ending March 31, 2024, we initially expected a significant decline in sales of COVID-19-related products, but sales of therapeutic drugs expanded owing to the spread of the so-called ninth wave of COVID-19, and greatly exceeded our initial plan. In addition, the growth in the market for new drugs, including cancer drugs and the steady expand in sales of limited-handling products for selected wholesalers, such as specialty pharmaceuticals, contributed to total sales. In price negotiations with medical institutions, we continued to strive to negotiate unit prices for individual products, commensurate with individual product values and distribution costs, in order to promote distribution improvement. As for the customer support systems, the introduction of ENIFvoiceSP and the switch from ENIF to Future ENIF contributed to profit growth.

As a result, the Company’s consolidated operating results for the six months ended September 30, 2023 recorded 734,846 million yen for net sales (an increase of 7.8% on a year-on-year basis), 6,492 million yen for operating profit (an increase of 11.3% on a year-on-year basis), 7,945 million yen for ordinary profit (an increase of 7.5% on a year-on-year basis), and 8,782 million yen for profit attributable to owners of parent (an increase of 144.1% on a year-on-year basis).

The interim dividend was 18yen per share (Ordinary dividend 16yen, commemorative dividend 2yen). The year-end dividend is also expected to be 18yen per share (annual dividend of 36 yen).

Currently, the Group is promoting the Medium-Term Management Plan 2023-2025, “Create the Next Generation,” which covers three years from the fiscal year ending March 31, 2024. Positioning the three years as a period of laying the foundation for the Group to fulfill its social mission even in the next generation as a corporate group engaged in the medical, health and nursing care sectors, we have implemented concrete measures through active alliances, the introduction of DX, etc. based on four basic policies: (1) Business transformation, (2) Investment for growth and improvement of profitability, (3) Sustainability management, and (4) Improvement of capital efficiency and enhancement of shareholder returns.

In the area of business transformation, in July, TOHO PHARMACEUTICAL CO., LTD., a consolidated subsidiary of TOHO HOLDINGS CO., LTD., made substantial organizational changes mainly in the sales department as the first step in transformation of pharmaceutical wholesaling business, and reorganized into an organization based on secondary medical care areas to promote community-based initiatives. We are also promoting the unification of pharmaceuticals and reagents, consolidation of sales bases, and streamlining of sales and delivery. Furthermore, we are working to create new businesses through open innovation. In April, we established a joint research laboratory with the National Institute of Advanced Industrial Science and Technology (AIST), one of Japan’s leading technology centers, and 24 employees from the Group are participating in joint research. Under MAXIS2021, an internal reform project, more than 50 young employees are studying reform proposals on topics such as customer support systems, sales, and distribution. In September, we entered into a capital and business alliance with MICIN, Inc., which is engaged in the online medical business, clinical development digital solutions business, etc. with the aim of solving various issues in the healthcare field through collaboration synergies between businesses of the two companies.

As for sustainability management, we will work to reduce CO2 emissions by procuring renewable energy. In addition, all officers and employees will continue to make their utmost efforts to comply with relevant laws and regulations and manage risks as a matter of top priority. At the same time, we will continue to invest in human resources for the health and growth of employees, which are the Group’s largest management resources.

In September 2023, the Company celebrated its 75-year anniversary. In order to properly pass on to the next generation the assets that our predecessors have built up, we are determined to firmly implement the measures in the Medium-Term Management Plan and continue to be a company that is needed by society.

Thank you for your continued support and understanding.