Financial Overview

(in million JPY )	FY2007	FY2006	Rate of change	Factors
Sales	447,854	394,859	13.4%	Sales increased year-on-year, supported by stable production at its customers' plants at home and abroad. The rise was also attributed to the Company's having strengthened its marketing activities, expanded production facilities, and revamped its production lines and systems.
Operating income	27,425	22,244	23.3%	The Company worked on reducing costs and enhancing business efficiencies.
Ordinary income	24,847	23,457	5.9%
Current net income	11,046	12,770	(13.5%)

Business overseas

- China
The Company has started enhancing manufacturing capacity of body parts, mufflers and fuel tanks in Tianjin, planning to complete the preparation for 2009 by the end of fiscal 2007. Following in Tianjin, it will start building a new plant in Guangzhou at the end of this year to early next year, which is scheduled to start operations in the autumn of 2008. (From an article of Nikkan Jidosha Simbun on Nov. 19, 2007)

- India
In December 2007, the Company and Maruti Suzuki India Limited, which is a subsidiary of Suzuki Motor Corporation, jointly established FMI Automotive Components Ltd. in India. Futaba has a 51 percent ownership in the new entity, which manufactures mainly automotive mufflers.

Medium Term Business Plan
The Company aims to achieve the following objectives by the end of March 2012.
-Sales of more than 500,000 million JPY.
-ROE of more than 8.0%.

R&D Expense

( in million JPY)	FY2007	FY2006	FY2005
Group	3,971	3,909	3,692
Automotive Parts	3,200	3,110	2,993

R&D activities in FY2007
-The Company worked on enhancing the development of its major products as well as developing environmentally friendly products based on strengthened industry-university joint-development activities. These efforts led to greater demand for its high performance heat recovery equipment, which will improve the fuel economy of hybrid vehicles.

-The Company is developing PM/NOx treatment devices as a means of controlling exhaust emissions.

-The Company is also developing hydrogen generators, which are expected to improve vehicle fuel economy and reduce CO2 emissions.

Capital Expenditure

( in million JPY)	FY2007	FY2006	FY2005
Amount	71,369	58,091	61,585

In the fiscal year ending March 2008, the Company invested to increase its production capacity, primarily in the automotive parts business (mainly for stamping machines). In addition, investments were made to rationalize operations and reduce labor in order to improve its productivity. Also, the Company invested to install production equipment (mainly assembly and welding lines and dies and jigs) needed to enable the Company to switch over to handling new products. The Company also invested in plant buildings and production facilities by either building new or adding on to existing facilities.

New facilities (Automotive Parts)

Name (Location)	Facility type	Planned investment (in million JPY )	Start	End
Futaba Industrial Co., Ltd.
Head Office, Okazaki Plant (Okazaki City, Aichi)	Production facility	2,000	Apr. 2007	Mar. 2009
Midori Plant (Toyota City, Aichi)	Production facility	3,000	Apr. 2007	Mar. 2009
Chiryu Plant (Chiryu City, Aichi)	Production facility	1,450	Apr. 2007	Mar. 2009
Koda Plant (Nukata gun, Aichi)	Production facility	12,000	Apr. 2007	Mar. 2009
	R&D facility	600	Dec. 2007	Mar. 2009
Mutsumi Plant (Okazaki City, Aichi)	Production facility	3,500	Apr. 2007	Mar. 2009
Tahara Plant (Tahara City, Aichi)	Building and Production facility	6,600	Apr. 2007	Mar. 2009
Takahashi Plant (Okazaki City, Aichi)	Production facility	600	Feb. 2008	Mar. 2009
	Dies and jigs etc.	25,000	Apr. 2007	Mar. 2009
Consolidated subsidiary
(Futaba Imari Corp. (Saga Pref., Japan)	Production facility	2,000	Oct. 2007	Mar. 2009
Futaba Hiraizumi Corp. (Iwate Pref., Japan)	Production facility	250	Mar. 2008	Mar. 2009
APICS Corp. (Aichi Pref., Japan)	Building and Production facility	1,500	Dec. 2007	Mar. 2009
FIC America Corp. (Illinois, USA)	Production facility	1,000	Jan. 2008	Mar. 2009
Futaba Indiana of America Corp. (Indiana, USA)	Production facility	700	Jan. 2008	Mar. 2009
Futaba Industrial Texas Corp. (Texas, USA)	Production facility	50	Apr. 2008	Mar. 2009
FIO Automotive Canada Corp. (Ontario, Canada)	Production facility	1,000	Oct. 2007	Mar. 2009
Futaba-Tenneco UK Ltd. (Lancashire, UK)	Production facility	1,500	Dec. 2007	Dec. 2008
Futaba Industrial U.K. Ltd. (Derbyshire, UK)	Production facility	2,000	Dec. 2007	Dec. 2008
Futaba Czech s.r.o. (Czech Republic)	Production facility	500	Dec. 2007	Dec. 2008
Tianjin Shuang Shye Mechanical Industrial Co.,Ltd. (Tianjin, China)	Production facility	2,500	May 2007	Dec. 2008
Tianjin Futaba Shye Chan Mechanical Industrial Co.,Ltd. (Tianjin Development Area, China)	Production facility	1,800	Jun. 2007	Dec. 2008
Guangzhou Futaba Auto Parts Co., Ltd. (Guangzhou, China)	Building and Production facility	3,900	Dec. 2007	Dec. 2008
Dongguan Futaba Metal Products Co., Ltd (Dongguan, China)	Production facility	100	Jan. 2008	Dec. 2008
FMI Automotive Components Ltd. (Haryana, India)	Building and Production facility	5,000	Dec. 2007	Mar. 2009