Metalart Corporation Business Report FY2012

Business Highlights

Financial Overview

(in millions of JPY)

	FY ended Mar. 31, 2012	FY ended Mar. 31, 2011	Rate of Change (%)	Factors
Overall
Sales	28,343	26,056	8.8	-
Operating income	1,879	1,587	18.4	-Performance improved year-on-year due to increased sales and successful cost-cutting measures.
Ordinary income	1,917	1,545	24.1	-
Net income	966	872	10.8	-
Automotive Components
Sales	17,364	16,429	5.7	-In Japan, operations were negatively affected by the Great East Japan Earthquake and the flooding in Thailand. Nevertheless, along with an economic recovery, eco-car sales-incentive programs were reintroduced in December, which helped the Company's financial performance. -Performance outside Japan, mainly in developing countries in Asia, improved year-on-year as the result of winning much more new business due to the strong sales of compact cars, as well as to new business for multi-purpose vehicles (MPVs) destined for sale in resource-rich countries.

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

Outlook for FY ending Mar. 31, 2013

(in millions of JPY)

	FY ending Mar. 31, 2013 (Estimate)	FY ended Mar. 31, 2012 (Result)	Rate of Change (%)
Sales	26,500	28,343	(6.5)
Operating income	1,450	1,879	(22.8)
Ordinary income	1,480	1,917	(22.8)
Net income	890	966	(7.9)

R&D

R&D Activities

-Based on a new production method, the Company successfully reduced six processes that were needed after the forging process to complete the production of shafts. This was made possible by combining hot-forming and cold-forming processes to make a single-unit shaft, which is a part that conventionally was built by welding two parts together. As a result, the Company achieved a net-shape ratio of 15%, which is the percentage of finished product to the mass of structural material (steel) used in forging. In addition, this new method achieved a cost-reduction of 20%.

Technology Licensing-out Agreement

(As of Mar. 31, 2012)

Partners	Country	Technology	The term of a contract
PT Menara Terus Makmur	Indonesia	Manufacturing technology for forged products	Oct. 1996 - (Automatic renewal)

Investment Activities

Capital Expenditure

(in millions of JPY)

	FY ended Mar. 31, 2012	FY ended Mar. 31, 2011	FY ended Mar. 31, 2010
Overall	1,287	361	318

-The Company invested mainly in the second machining line at MetalTex's Mizuguchi Plant, which was installed to produce components for CVT transmissions.