Financial Overview

(in millions of JPY)

	FY2008	FY2007	Rate of Change (%)	Factors
Overall
Sales	30,544	37,218	(17.9)	-Sales decreased significantly, as sales of precise functional components and materials declined with substantial production adjustment by automakers.
Operating income	1,052	3,552	(70.4)	-Income decreased as sales declined and the yen proceeded to strengthen rapidly in the second half.
Ordinary income	824	3,410	(75.8)	-
Net income	228	1,841	(87.6)	-
Functional precision materials division
Sales	3,295	4,258	(22.6)	-Sales decreased due to a decline in exports of high-strength, high-tensile steel for valve springs and in sales of precise deformed materials for automotive transmissions.
Functional precision components division
Sales	17,572	20,613	(14.8)	-Sales decreased for almost all products including valve springs, starter ring gears and seat belt retractor springs, due to a decline in automobile production.

Recent Developments
-The Company announced the merger/acquisition of its wholly-owned subsidiary Hirose Technology. Hirose Technology is based in Toyota City, Aichi, and manufactures automotive components such as ring gears. Following the completion of the transaction, the subsidiary will continue its production operations, using one of the its existing facilities as its own. (From a press release on Dec. 12, 2008)

R&D Expenditure

(in millions of JPY)

	FY2008	FY2007	FY2006
Overall	719	828	1,097

R&D Activities
Hybrid-vehicle components
The Company developed hybrid car related components by combining newly developed technology, insulating coating processing, and a core technology, precise deformation processing. The Company worked on producing and testing mass production facilities based on its accumulated development technologies.

Functional precision materials/components
-As fuel efficiency and performance of automobiles improves, valve springs and clutch springs are required to have higher stress designs. In response to this trend, the Company created the high-strength, high-heat resistance oil temper line. Since various alloy elements are blended and added to this product, it has sufficient spring workability, maintaining high strength, superior nitriding treatment ability and high sag resistance, which improves fatigue strength.

Capital Investment

(in millions of JPY)

	FY2008	FY2007	FY2006
Overall	2,254	3,229	3,667
Functional precision materials division	246	2,089	329
Functional precision components division	1,529	2,364	2,289

-The Company invested primarily in production lines for new products, and improvement of production capacity, productivity, quality and environment.



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

Functional precision components division
-The Company invested primarily in production lines for mass production of hybrid car related components and new automobile-related components, and in improvement of productivity and quality.


New Facilities (Functional Precision Components division)

Company or Office Name	Facilities	Expected Investment (thousand yen)	Started	Complete
Headquarters and Plant (Ukyo-ku, Kyoto City)	Manufacturing equipment	175	2009.04	2010.03
Toyota Plant (Aichi Pref., Japan)	Manufacturing equipment	114	2009.04	2010.03
Hirose Technology (Aichi Pref., Japan)	Manufacturing equipment	20	2009.04	2010.03
Suncall Engineering (Yamanashi Pref., Japan)	Manufacturing equipment	22	2009.04	2010.03
Suncall Kikuchi (Kumamoto Pref., Japan)	Manufacturing equipment	12	2009.04	2010.03