FY2018 First Half Business Results Announcement

On November 1, we announced our FY2018 first half business results. It was the first quarter after releasing our mid-term management plan in May. Although operating income and ordinary income slightly decreased compared with last year, they were above the forecast that we had announced at the beginning of this fiscal year, making me relieved.

In the first half of this fiscal year, there was growing demand for automotive wiring harnesses, cemented carbide tools and power cables. At the same time, there was also an increase in our costs related to wiring harnesses—though this rise had been planned—because of our reinforcement of research and development as we look toward the future. In addition, we were affected by price depreciation. As a result of these positive and negative factors, the outline of our consolidated business results for the first half of this fiscal year is as follows: net sales of 1.5284 trillion yen (up 4.7% compared with the same period last year); operating income of 64.3 billion yen (down 2.2%); ordinary income of 75 billion yen (down 1.7%); and profit attributable to owners of the parent of 42.4 billion yen (up 13%).

* FY2018 First Half Forecast Announced at the Beginning of the Fiscal Year
Net sales: 1.555 trillion yen; operating income: 60 billion yen; ordinary income: 70 billion yen; and profit attributable to owners of the parent: 40 billion yen

Accordingly, as we announced at the beginning of this fiscal year, the interim dividend is 24 yen per share, up 3 yen from the corresponding period a year earlier.

However, I'm concerned that the U.S.-China tariff problem has begun to generate negative effects both directly and also indirectly, as indicated by, for example, a decline in stock prices, causing some anxiety over the future. We need to continue to pay attention to the moves of the Trump administration, such as its response to the U.S. midterm elections, sanctions against Iran and tariffs not only on China but also on NAFTA and Japan. In this environment, we will continue to do our best in order to ensure that our FY2018 business results are higher than forecast, marking our highest ever figures in net sales and other items, thereby preparing for better performance in the next fiscal year.

We have been working strenuously so far to improve SEQCDD (Safety, Environment, Quality, Cost, Delivery, and Research & Development).* By continuing to do so, we will strive to make our corporate structure even more robust to withstand changes in the external environment.