TS TECH Co., Ltd. Business Report FY ended Mar. 2020

Financial Overview

(in millions of JPY)
  FY ended Mar. 31, 2020 FY ended Mar. 31, 2019 Rate of Change (%) Factors
Sales 359,682 412,072 (12.7) 1)
Operating income 26,326 38,793 (32.1) -
Ordinary income 28,751 41,407 (30.6)
Profit for the year attributable to owners of the parent 15,064 25,750 (41.5)

 

Factors

1) Sales
-Sales fell 12.7% year-on-year (y/y) due to the coronavirus and lower production volumes.

<Japan>
-Launched production of seats for the redesigned Honda N-WGN and Fit.

For the fiscal year that ended in March 2020, the company’s operating capacity in Japan has continued to run at full capacity, meaning that so far the coronavirus has had a negligible impact.

ーOperating revenue: Some of the Company’s customers stopped production of some models as well as delayed the launched of production of new models. As a result, operating revenue was lower by 19.1% y/y.
ーOperating profit: Lower by 49.3% y/y because of decreased revenue.

<The Americas>
From the end of March 2020, some of the production plants have stopped production.

ーOperating revenue: Operating revenue, which fell 9.8% y/y, was impacted by lower production volumes because of the coronavirus, lower sales of dies, and negative currency translation.
ーOperating profit: Due to lower revenue, operating profit fell 19.8% y/y.

<China>
-Production launch in Wuhan of seats for the redesigned Honda Envix and in Guangzhou of seats for the redesigned Breeze.

Due to the coronavirus, some of the production plants ceased operations from January 23, 2020 to the middle of March.

ーSales revenue: fell 7.2% y/y due to the coronavirus and the negative impact of foreign-currency translation.
ーOperating profit: fell 6.7% y/y due to lower revenue.

<Asia and Europe>
ーLaunched production of seats for the redesigned Accord and City in Thailand.

At the end of March 2020, even though some of the production plants ceased operations, the effects were negligible.

ーSales revenue: production volumes in India and the UK, as well as sales of auto-parts, decreased. As a result, operating profit fell 22.2% y/y.
ーOperating profit: fell 61.1% due to lower sales revenue and then need to allocate reserves to pay for layoffs at TS UK.

 

Recent Development

Closing UK Operations
-The Company announced that it is starting negotiations to deal with the closure of the UK operations. This is the result of Honda of UK Manufacturing’s ceasing production of automobiles in 2021, the OEM to which TS-Tech UK (TSUK) delivers automotive seats that it manufactures. Due to this situation, TSUK decided that it will be difficult to continue to maintain its current level of operations in the country. TS-Tech announced that it will make an announcement about it business plans, after the labor negotiations have ended. (From a Dec. 11, 2019 news article in the Nikkan Jidosha Shimbun)

 

R&D Expenditure

(in millions of JPY)
  FY ended Mar. 31, 2020 FY ended Mar. 31, 2019 FY ended Mar. 31, 2018
Group 12,300 12,700 11,900

  

R&D Facilities

Name Location
Technical Center Tochigi Pref., Japan
Engineering Center Tochigi Pref., Japan
Safety Technical Center Tochigi Pref., Japan
TS Tech Americas, Inc. Ohio, U.S.A.
TS Tech Asian Co., Ltd. Bangkok, Thailand
TS Tech Deutschland GmbH Tappenbeck, Germany
Guangzhou TS Tech Automotive Interior Research & Development Co., Ltd. Guangzhou, China

 

Capital Investment

(in million JPY)
  FY ended Mar. 31, 2020 FY ended Mar. 31, 2019 FY ended Mar. 31, 2018
Japan 3,662 3,667 3,515
Americas 2,417 2,033 2,671
China 954 737 1,322
Asia/Europe 584 974 1,131
Total 7,619 7,412 8,640

-The Company has not decided the budget for capital investments due to the coronavirus.