Securities Report - 107th Fiscal Period (2025/04/01 - 2026/03/31)

Asahi Diamond Industrial Co., Ltd. Securities Report - 107th Fiscal Period (2025/04/01 - 2026/03/31)

The company's primary business involves the design, manufacturing, and sales of cemented carbide tools and diamond-based cutting and grinding tools. It supplies high-precision, long-life tools to diverse industries including automotive, aerospace, and electronics, both domestically and internationally, with value creation through technological innovation as a core management pillar.

The 107th fiscal period covers the one-year term from April 1, 2025, to March 31, 2026. This report is submitted in accordance with the Financial Instruments and Exchange Act as part of investor disclosure, providing detailed information on the company's financial position, operating results, and cash flow.

For the current period, despite external challenges such as yen appreciation and fluctuating raw material prices, sales revenue and operating profit are projected to exceed the previous year's levels, driven by expanded sales of high-value-added products and improved production efficiency. Demand remains strong for cemented carbide drills targeting the aerospace sector and diamond wire saws used in electronic component processing, with ongoing initiatives to expand market share globally.

In research and development, the company is advancing next-generation nano-coating technologies and an AI-powered tool wear prediction system, with prototype validation tests scheduled to begin in the 2025 fiscal year. These innovations are expected to directly enhance customer productivity and serve as key differentiators in the future.

Regarding overseas expansion, the company is strengthening its local sales networks in Southeast Asia, having signed agreements with new distributors in Vietnam and Thailand. In the North American market, a technical support hub has been established in Canada to enhance responsiveness to local customers.

From an environmental, social, and governance (ESG) perspective, the company has established a roadmap toward achieving carbon neutrality by 2030, aiming to increase the adoption rate of renewable energy at its factories to 40% by the end of the 2025 fiscal year. Additionally, initiatives to promote organizational sustainability include increasing the ratio of female managers and expanding diversity programs.

Going forward, the company will continue to leverage its technological capabilities and global expansion strength to maximize customer value and enhance shareholder value.