Investor Relations Performance Trends

March 2020 term 1Q

In April 2018, the Group launched “IKO Medium-term business plan 2020 CHANGE & CHALLENGE ~Next Stage –ACCOMPLISH–.” With the aims of realizing sustainable growth and establishing a highly profitable organization, the Group has been implementing a range of measures to solve priority issues through inter-departmental efforts and improve efficiency in all operations.

From a sales perspective, the Group worked to focus on expanding sales of strategic products and reinforce customer management using a new system. Moreover, the Group executed a massive overhaul of its corporate website to improve customer convenience as part of its efforts to enhance the market presence of the IKO brand through web-based stakeholder communication.

In terms of product development, the Group worked to expand its lineup of products that provide high added value from the customer perspective by, for example, releasing “Mounting Holed Type Super Slim Crossed Roller Bearing,” which contributes to the creation of compact and lightweight rotating parts. The Group also developed the “PM-Coat,” a new surface finishing method for needle-roller cages for connecting rods. This method is expected to curb energy loss attributable to friction. As such, the Group was active in R&D aimed at contributing to the protection of the global environment.

From a production standpoint, the Group continued to boost production capacity at its domestic factories, as well as the production subsidiary IKO Thompson Vietnam Co., Ltd., in order to secure its responsiveness to demand growth over the medium to long term. At the same time, the Group proactively implemented on-site improvement measures, with the aim of streamlining production, promoting labor saving and realizing ideal manufacturing processes.

As a result, consolidated net sales for the first quarter of the fiscal year under review totaled ¥13,256 million, down 12.6% year on year. On the earnings front, due mainly to decreased revenue, operating profit came to ¥809 million, down 39.6% year on year, and ordinary profit came to ¥653 million, down 57.7% year on year. Profit attributable to owners of the parent amounted to ¥486 million, down 58.8% year on year.

Consolidated Balance Sheets

Total assets as of June 30, 2019, totaled \102,609 million, an increase of \1,141 million compared with the end of the previous fiscal year. This mainly comprised increases in securities of \1,699 million, inventories of ¥1,497 million and tangible fixed assets of \1,826 million as well as decreases in cash and deposits of \2,488 million, accounts receivable-trade of \809 million and investment securities of \296 million.

Total liabilities amounted to \42,831 million, an increase of \1,558 million compared with the end of the previous fiscal year. This mainly comprised increases in accrued expenses of \595 million and accounts payable-other of \1,332 million, long-term loans payable of \1,144 million as well as decreases in notes and accounts payable-trade of ¥237 million and income taxes payable of \1,381 million.

Total net assets amounted to ¥59,777 million, an decrease of ¥417 million compared with the end of the previous fiscal year. This mainly comprised decreases in net unrealized holding gains on available-for-sale securities of ¥203 and foreign currency translation adjustment of ¥197 million.