Financial Overview

(in millions of JPY)

	FY2010	FY2009	Rate of Change (%)	Factors
Overall
Sales	33,089	28,790	14.9	-
Operating income	2,606	2,023	28.8	-
Ordinary income	2,471	2,148	15.0	-
Net income	1,428	1,195	19.5	-
Functional precision materials division
Sales	3,601	3,053	17.9	-Sales were up due to increased exports of materials for valve springs, and irregular shaped precision materials used on engines.
Functional precision components division
Sales	18,203	16,855	8.0	-The Company was on a strong path to recovery through the 2nd quarter; however, with the end of the eco-car sales incentives, which caused auto sales to stagnate in the 3rd quarter; and customers in the 4th quarter reducing their production volumes due to the Great East Japan Earthquake, the pace of the recovery weakened.

>>>Financial Forecast for the Next Fiscal Year(Sales, Operating Income etc.) 

R&D Expenditure

(in millions of JPY)

	FY2010	FY2009	FY2008
Overall	523	441	719

R&D Activities

Functional precision materials/components (Japan, U.S., Asia)
-Development of spring valve materials for hybrid cars.
The Company developed spring valve materials for use in engines designed for hybrid cars. In order to deliver the special features and cost-requirements that customers demanded, the Company completed optimum designs for the material substances and manufacturing conditions. The Company is, aiming to put them into commercial use in 2014, while still evaluating the special characteristics of spring valves.

-Development of high-precision piston-ring materials
The Company continued its work on developing high-precision, irregular-shaped materials that reduce the amount of grinding on piston-rings compared to that of materials currently in use. As a result, the Company successfully cleared all the specification requirements by designing processes and conditions that diminish rough surface areas, taking the lead ahead of other companies in successfully producing these materials commercially.

In addition to the above, the Functional Precision Processing Division worked on products that until now used ultra high-strength spring materials, on which the Company has continued its R&D activities, increasing their fatigue strength by 7%. It has decided to commercially produce them for next-generation vehicle models. Also, in tandem with developing high-end materials, the Company has been conducting R&D activities on low-cost materials that eliminate the need for the heat treatment process through technology the Company has acquired on cold-work processing, successfully responding to low-price requirements, in addition to meeting customer needs for making them lighter and more compact.

Capital Expenditure

(in millions of JPY)

	FY2010	FY2009	FY2008
Overall	2,255	1,177	2,254
Functional precision materials (Japan)	221	-	-
Functional precision materials	221	98	246
Functional precision components (Japan)	715	-	-
Functional precision components (U.S.)	26	-	-
Functional precision components (Asia)	82	-	-
Functional precision components	823	385	1,529

-The company's main investment activities were for increasing its production volumes, improving productivity, reducing costs, raising product quality, and enhancing the environmental responsiveness of its products.

Functional precision materials
-The Company invested primarily in improvement of productivity of valve spring materials, precise deformed materials and environment.

Functional precision components
-The Company invested mainly in projects which will contribute to reducing costs and improving the environmental responsiveness of its automotive components.

New Facilities (Functional Precision Components Division)

(As of Mar. 31, 2011)

Company or Office Name	Facilities	Expected Investment (in millions of JPY)	Project period
			From	To
The Company (Kyoto, Japan, etc.)	Manufacturing facility (Functional precision materials division)	202	Apr. 2011	Mar. 2012