Financial overview

In million JPY	FY2007	FY2006	Rate of Change (%)	Factors
Sales	321,154	289,760	10.8	The sales volume of vehicles equipped with the company's products suh as as wiper systems and power-steering motors grew due to brisk production by Japanese automakers in Japan and overseas.
Operating income	12,293	8,081	52.1	・Improved production capacity utilization due to increased sales, cost-cutting efforts for each product range, and rationalization initiatives such as enhancing productivity.
Ordinary income	10,005	8,534	17.2
Net income	3,259	3,903	(16.5)	・Setting reserves retroactively for retirement benefits for directors and corporate auditors

Japan:
-Sales increased 8.7% to 263,737 million yen year-on-year, thanks to a rise in production of vehicles destined for export in response to brisk sales of Japanese cars on the global market; and also due to effective marketing efforts for auto parts destined for export in connection with an increase in global production.

The U.S.A.:
-Sales slid 4.8% year-on-year to 64,943 million yen due to shrinking car sales caused by the subprime mortgage crisis and a rise in fuel prices.

Other regions (Asia and Europe)
-Sales soared 29.6% year-on-year to 48,366 million yen as a result of an increase in Japanese car production in China and the ASEAN region as well as robust vehicle production in Europe.

R&D Expenditure

(in millions JPY)	FY2007	FY2006	FY2005
R&D Expenditure	13,513	13,875	13,471

R&D Structure
-The R&D sections played a central role in further developing the company's global operations. The company furthered R&D activities in cooperation with Asmo Detroit, Inc.

R&D activities are conducted with several key words in mind. These are safety, environment, comfort and convenience.
-In dealing with and responding to environmental issues, the company is conducting R&D activities to develop motors using new systems that contribute to enhancing automotive fuel consumption and reducing emission gas. The company is also working on developing new, highly efficient and light-weight drive-trains and alternative technologies that are aimed at controlling environmentally harmful substances used in products.

R&D achievements
<Next-generation products>
・The Company developed small and lightweight electric fans for mass-production by improving rectification.
・The Company was able to develop smaller and lighter weight drive circuits used in exhaust control motors for diesel engines. These fans have greater resistance to heat and moisture, made possible by applying surface mount technology. As a result, the company was able to mass-produce these drive circuits.
・The Company made the controller for rear wiper motor more compact by integrating it into the motor. This enabled the Company to mass-produce this motor.

<New products>
・Mass-produced motors for the valvematic (used for controlling the engine inlet valve) to achieve improved fuel efficiency and greater power
・The Company first proposed developing retractable rear wipers that are embedded in spoilers so as to improve the vehicles appearance and design. The Company later decided to commercialize this wiper for installation on vehicles.

Technological licensing-in agreements (as of March 2008)

Partner	Country	Product	Contractual Coverage	Contract Period
Canon	Japan	Ultrasonic wave motors	- Licensing of patented technologies and receiving of technical information	Jan. 1, 1998 - Dec. 31, 2017
Matsushita Electric Industrial Co., Ltd. (Panasonic)	Japan	Ultrasonic wave motors	- Licensing of patented technologies and receiving of technical information	March 19, 1999 - automatic extension

Capital Expenditure

(in millions JPY)	FY2007	FY2006	FY2005
Capital Expenditure	21,420	26,805	24,413

The Company and its consolidated subsidiaries invested a total of 21,420 million yen on their manufacturing facilities so they could switch over to handling next-generation products, increase production volume of existing products, and improve quality and reliability of the products.

-In FY2008, the fix amount budgeted for capital expenditures (for building new facilities and expanding existing plants) is 22,500 million yen.

New facilities

Company name	Type of facility	Planned total investment (million JPY)
Asmo (Kosai City, Shizuoka Pref.)	Production of small motors	13,890