Q: Please tell us about your financial results for the FY2019.

Yuki:
Sales and profits decreased due to the effects of the US-China trade friction and the novel coronavirus.

In the FY2019, net sales decreased by 39.6 billion yen and operating income decreased by 4.6 billion yen. Net sales decreased 7.5% from the previous fiscal year due to a decrease in sales in the automotive market, which is our core market, affected by lower automobile sales in China due to the trade friction between the U.S. and China as well as lower production and sales in China and Europe due to the spread of the new coronavirus infection. In addition, operating income decreased 23.9% year-on-year due to factors such as a decrease in capacity utilization due to a decline in sales.

By market, in the car AVN (audio/visual/navigation) field, sales decreased due to a decrease in the number of automobiles sold and a decrease in the installation cost per vehicle due to the shift to DA (display audio). On the other hand,in the Car Electronics segment, sales for safety (camera and radar) increased about 5% from the previous fiscal year in response to the progress of ADAS (Advanced Driver Assistance Systems), and sales for EV powertrains, including the three-dimensional Floating Board to Board connector "Z-Move ® " increased about 50%. In addition, for the consumer market, we have started shipping a newly developed Floating Board to Board Connector for Robot assembly of televisions.

Q: Please tell us about the outlook for the FY2020.

Yuki:
In the second half, we expect sales to return to the same level as the previous fiscal year.

In the FY2020, we expect net sales of ¥34.0 billion (down 14.2% year-on-year) and operating income of ¥1.4 billion (down 69.8% year-on-year). Due to government policies to control the spread of COVID-19, automobile production has been suspended in Europe, the United States, Asia, and Japan. We have formulated a sales plan based on the assumption that the number of units will decrease by about 20% year-on-year to 72 million units. Although the industrial market is also expected to shrink, in the consumer market we plan to expand sales of connectors for Robot assembly for game consoles and TVs.

While we expect a significant decline in sales, mainly in the first quarter, we are working to improve productivity, shorten lead times, maintain facilities, improve process defect rates, conduct safety inspections, and develop human resources. We will work to improve profitability after COVID-19.

Q: Please tell us about the results of the medium-term management plan.

Yuki:
Despite the deterioration of the external environment, we were able to achieve a certain level of results.

Due to changes in the external environment that were not anticipated when the plan was formulated, such as the U.S.-China trade friction and the novel coronavirus, the medium-term management plan for the FY2016 to the fFY2019 set sales targets of 50 billion yen, The 20% profit margin was not achieved. On the other hand, efforts in safety and powertrain systems in the car electronics field, which is a focus area, performed well, and net sales increased by 5.0 billion yen. In addition, we have achieved results such as expanding the lineup of "Z-Move structure " in product development, transitioning to a "company with an audit and supervisory committee" to strengthen governance, and establishing a "nomination committee" and a "compensation committee". 

Q: Please give a message to shareholders.

Yuki:
We will strengthen our efforts to achieve sustainable growth.

For the FY2019, despite the expected deterioration in business performance due to the impact of the new coronavirus, we have decided to pay a dividend of 70 yen per share to maintain employment and secure funds for medium- to long-term growth. to 50 yen per share (dividend payout ratio of 35.8%). Going forward, we will continue to promote growth strategies for safety and powertrain systems in the car electronics field, while strengthening our efforts in the industrial market, which we have positioned as our second pillar. In addition, in order to build a foundation for medium- to long-term growth, we will formulate a roadmap for zero CO 2 emissions by 2030, further promote diversity and work-life balance, expand the number of outside directors, and implement ESG initiatives such as enhancing risk management. We will also focus on We would like to ask our shareholders for their understanding and continued support.