FAQ for FY2025 Q4 Financial Announcement | Global

What was the breakdown of ¥9.4 billion in one-time factors for the fourth quarter of fiscal 2025 (see page 6 of Consolidated Results for the Year Ended March 31, 2026)?

Ricoh Digital Services posted around ¥8.0 billion in impairment losses and valuation-related expenses owing to organizational restructuring and other factors. Ricoh Digital Products booked about ¥4.0 billion yen in production reform costs relating to ETRIA. The amount for other segments was around ¥4.0 billion in new business impairment charges. Combined one-time expenses were about ¥16.0 billion. At the same time, there was an approximately ¥7 billion gain on asset sales, resulting in ¥9.4 billion in net one-time factors for the fourth quarter.

Tell us about the ¥11.1 billion in structural reforms listed under FY2026 Outlook Operating Profit Comparisons (see page 19 of Consolidated Results for the Year Ended March 31, 2026).

Around 80% of these costs are for production reforms relating to ETRIA in the Digital Products segment.

Tell us about the ¥8.0 billion Chinese subsidiary transfer listed under FY2026 Outlook Operating Profit Comparisons (see page 19 of Consolidated Results for the Year Ended March 31, 2026).

This relates to our April 9 announcement of a decision to transfer our entire equity stake in a sub-subsidiary in Shenzhen, China, and recognize a gain on that transfer. We factored the ¥16.5 billion gain in our forecast, booking ¥8.0 billion of that amount as a one-time factor. We classified the other ¥8.5 billion of that gain under expenses due to its nature. We described this matter as a significant subsequent event in our Flash Report for the year ended March 31, 2026. We expect to record a ¥17.8 billion gain on the equity transfer owing to differences in the exchange rates applied to that transaction.

The ¥8.2 billion in expenses under FY2026 Outlook Operating Profit Comparisons (see page 19 of Consolidated Results for the Year Ended March 31, 2026) includes ¥8.5 billion in gains from transferring a Chinese subsidiary, your underlying expenses are around ¥17.0 billion. What's the breakdown of these expenses?

We expect higher costs from such factors as inflation and labor expenses and from higher Graphic Communications development expenses.

You estimated the impact of rising semiconductor memory costs at ¥20 billion. What segments have you factored this into?

We expect the higher costs to primarily affect Digital Products, although they will also affect Graphic Communications. We look to absorb about 90% of the ¥20 billion impact through procurement and pricing measures. We have factored into the relevant segments the remainder that we consider hard to absorb. At the same time, we have set have aside a ¥10 billion risk buffer under Eliminations and Corporate to account for semiconductor memory prices possibly rising more than we currently project and petroleum-related materials and transportation expenses also possibly increasing.

Have you secured enough semiconductor memory?

At this juncture, we are largely on track to secure the quantities we need for production during this fiscal year.

You forecast ¥50 billion in operating profit for Workplace Services in fiscal 2026. That's ¥26.4 billion more than the ¥23.6 billion you posted in fiscal 2025. Why?

We booked around ¥10 billion in one-time expenses net of related gains in fiscal 2025, so the underlying earnings increase would be about ¥16.4 billion. We look for higher recurring revenues to drive profit growth.

You forecast ¥57 billion in operating profit for Digital Products in fiscal 2026. That's ¥20.4 billion lower than the ¥77.4 billion you posted in fiscal 2025. Why?

This decline would reflect such factors as production reform costs related to ETRIA and lower earnings from Office Printing non-hardware, where we expect revenues to fall around 3%.

As a result of your business segment reclassification, Graphic Communications effectively incurred an operating loss of ¥8.8 billion in fiscal 2025. You project a ¥5.5 billion operating loss in FY2026. Why will this business be in the red?

There are two prime factors behind losses following the reclassification. First, we transferred about ¥10 billion in costs to Graphic Communications. This was because we consolidated investment expenses related to inkjet functional printing, including such new businesses as perovskite solar cells and digital coating, into that segment. Second, we transferred around ¥18 billion in expenses from RICOH Digital Services after reviewing shared expense allocations across business units. While we project a loss in fiscal 2026, we expect a ¥3.3 billion earnings improvement. This should reflect higher profits in Commercial Printing non-hardware, which continues to perform steadily, and an earnings recovery from the second half of the fiscal year on rebounding demand for Commercial Printing hardware and inkjet heads in Industrial Printing.