On 11 May, we announced our full-year financial results for 2020.

In the first half of FY20, our business was hit hard by the spread of the new coronavirus around the world, which led to a decline in demand and forced us to adjust our production.

On the other hand, demand recovered in the second half of the year, exceeding our initial expectations.

As a result, although sales were down and we were in the red compared to the previous year, a comparison of the full year results with the first half results announced in October shows that "business profit", which is the profit from our main business, increased by 15.4 billion yen in the half year, from -7.5 billion yen to 7.9 billion yen.

There were some factors that contributed to the increase in profits only in FY20, such as the reaction to the decline in the first half of the year and, government subsidies. However, it can be said that your quick and steady response to customer requests, as well as efforts to improve profitability, such as reducing overheads and cutting costs, bore fruit.

The final result, on the other hand, was a significant loss, due to the losses incurred in the bold implementation of structural reforms, both in Japan and abroad.

However, this is a measure that will lead us to the future, and I believe that, together with the reduction in overhead costs achieved through your efforts, we have made progress in the "transformation to a solid management structure" that I have been talking about since I took office.

Thank you very much.

Net sales: ¥397.9 billion (year-on-year: -11%)

Business profit: 7.9 billion yen (year-on-year: -31%)

Profit for the FY2020 attributable to owners of the parent company: -5.0 billion yen (vs. a profit of 0.9 billion yen in the same period last year)

Announcement of the forecast for 2021

After consolidating the figures provided by each of the business units and taking into account risks such as the global shortage of semiconductors, the sharp rise in the price of raw materials and the re-emergence of the new coronavirus infection, we have announced our forecasts for fiscal 2021.

Consolidated net sales: 445 billion yen (+12% compared to FY20)

Business profit: 13.5 billion yen (+71% compared to FY20)

Profit for the FY2021 attributable to owners of the parent company: 3.5 billion yen (5 billion yen loss in FY2020)

The above figures are made based on a forecast that takes into account the current external environment to some extent.

Repair and maintenance costs, which were controlled in FY2020, may increase, but we ask you to continue to reduce the costs of work that could be done in-house and travel expenses that could be replaced by web conferences and other means, while assessing their cost-effectiveness.

I look forward to working with you all to achieve further increases in profits and make the company more trusted by all of our stakeholders.

To our dear employees

It is no exaggeration to say that we have entered an era in which we do not know what will happen, as there is no prospect of the new coronavirus pandemic being brought under control.

From now on, it will become increasingly important for our business operations to respond flexibly and speedily to changes in the business environment.

Even in such a business environment, the health and safety of all our employees and your families remains our top priority. For your own and your loved ones sake, we ask that you take the necessary steps to prevent infection and ensure safety in your daily work.

Despite the uncertain outlook, we must continue to improve profitability and develop products that meet the CASE requirements, such as electrification.

In addition to these, there are two particular areas of focus as follow;

①Efforts for carbon neutralization

②Promotion of digitalization

I am sure that you have been working on both of these issues.

However, things are progressing more rapidly than we thought on a global scale.

Therefore, we must not forget this year’s slogan "Creating a corporate culture that responds flexibly to change without being bound by past concepts”, and I would like you to work to keep our finger on the pulse of what is happening not only within the company, but also in the world.

The year ahead will be a year of many events, but let us work together with the spirit of “Banji-Nissei”!

2021.05