Financial Overview

( in million JPY )

	FY2006	FY2005	Rate of change	Factors
Overall
Sales	285,058	270,447	5.4	Sales increased due to strong demand for steel, automobiles, and construction machinery.
Operating income	13,173	17,089	(22.9)	Operating income decreased due to an increase in the cost of sales resulting from a sharp rise in materials prices and other factors.
Ordinary income	13,866	16,768	(17.3)	-
Current net income	7,826	7,976	(1.9)	-
Automotive/industrial component business
Sales	17,067	156,646	9.0	The Company worked to increase the sales volume of new products and high value-added products, mainly focusing on technology that reduces the weight of automobile aluminum wheels. It is also working on enhancing its production operations to respond to greater demand for construction machinery wheels.
Operating income	6,615	7,590	(12.8)	Materials prices continued to remain high at high levels. The Company was also negatively impacted cost increases it incurred as a result of producing greater volume.

Business Restructuring
The Company announced withdrawal from manufacturing aluminum wheels for passenger cars in the U.S.A. and reorganization of its U.S. subsidiaries to consolidate the current four companies to two, based on their business. The Company., a manufacturer of automobile wheels in Kentucky, and Topy International U.C.A., Inc., a manufacturer of under body parts for construction equipment in Tennessee, will be merged to a new company named Topy America. The heavy-duty dumper truck wheel business of Topy International Inc., Topy's holding company in Illinois, U.S.A., will also be merged to the new company, while the Topy International will be dissolved. Topy Fasteners, Ltd., a wholly owned subsidiary of the Company will purchase the whole stock of Topy Precision MFG., Inc., a manufacturer of industrial fasteners in Illinois.(From a story in the Nikkan Jidosha Shimbun on Feb. 19, 2007)

Investment expenditure

( in million JPY )

	FY2006	FY2005	FY2004
Group	1,999	1,987	1,853
Automotive & Industrial Machinery Components	1,281	1,167	1,100

Automotive & Industrial Machinery Components
The Company conducted research on solutions that reduce weight, improve quality, cut costs, and reduce development lead time. It also did research and development on new products.

The Company achieved favorable results for its mainstay products, namely automotive steel and aluminum wheels, in terms of improving the accuracy of technology to conduct analysis and evaluations, developing and mass-producing new products, cutting costs, and improving the quality of existing products.

investment