Financial Overview

(in millions of JPY)

	FY ended Mar. 31, 2012	FY ended Mar. 31, 2011	Rate of Change(%)	Factors
Overall
Sales	75,650	78,224	(3.3)	1)
Operating income	5,444	5,809	(6.3)	-Compared to the previous year, operating loss this year was lower.
Ordinary income	6,905	7,184	(3.9)
Current net income	4,051	3,859	5.0
Automotive/Industrial Machinery Component Division
Sales	63,265	64,415	(1.8)	-
Operating income	4,381	4,619	(5.2)	-

Factor
1)
-Performance was down year-on-year due to several factors that negatively affected the company's business. These included the slow recovery in demand for some auto-parts, which was the result of natural disasters; lower sales at affiliated companies located outside Japan; a shift in production operations to locations overseas due to the high evaluation of the yen; and postponements in construction projects targeted to customers outside Japan.

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

Performance Forecast

(in millions of JPY)

	FY ending Mar. 31, 2013 Forecast	FY ended Mar. 31, 2012 Result	Rate of Change (%)
Sales	78,000	75,650	3.1
Operating income	6,300	5,444	15.7
Ordinary income	7,500	6,905	8.6
Net income	4,700	4,051	16.0

R&D Expenditure

(in millions of JPY)

	FY ended Mar. 31, 2012	FY ended Mar. 31, 2011	FY ended Mar. 31, 2010
Group	1,347	1,286	1,086
Automotive/Industrial Machinery Component	1,233	928	765

R&D Structure

-The Next-Generation Product Planning Division inaugurated its planning activities with the aim of creating new products in areas with high growth potential such as hybrid and electric vehicles.

-R&D activities in the Automotive/Industrial Machinery Component Business are conducted by the R&D Department, Piston-ring Technological Development Department, and the product development and production technology sections at each of the manufacturing divisions.

R&D Activities

-Automotive/Industrial Machinery Component
1. Low friction and long-lasting gasoline-engine piston rings that lower fuel consumption
2. Diesel engine piston rings to meet requirements for low fuel consumption and emission regulations.
3. Transmission sealing rings
4. Superior valve-train parts and camshafts that are lighter in weight and produce less friction
5. Lighter and stronger suspension parts
6. Surface treatment technology that responds to all kinds of surfaces, and which enhances the gliding properties of products.

Technology licensing-out Agreement

(As of Mar. 31, 2012)

Company name	Country	Contract	Contract date	Contract period
Taiwan Riken Ind. Co., Ltd.	Taiwan	Manufacturing methods for various forged steel engine components such as piston rings, cylinder liners, blocks, cam shaft, and knuckles	Aug. 22, 2005	Terms for extending the agreement are subject to negotiation
Siam Riken Ind. Co., Ltd.	Thailand	Manufacturing methods for piston rings and other forged steel engine components	Apr. 19, 2009	5 years
P. T. Pakarti Riken Indonesia	Indonesia	Manufacturing methods for joint and forged parts	Jan. 1, 2006	10 years
Shriram Pistons & Rings Ltd.	India	Manufacturing methods for piston rings	Mar. 1, 2007	7 years
Allied Ring Corp.	USA	Manufacturing methods for piston rings	Jan. 1, 2009	5 years
Grede Holdings LLC	USA	Manufacturing methods for knuckles and damper forks	Aug. 17, 2010	5 years
		Manufacturing methods for lower control arm	Aug. 17, 2010	5 years
Korea Piston Ring Inc.	Korea	Manufacturing methods for piston rings	Mar. 1, 2010	5 years
Xiamen Riken Ind. Co., Ltd.	China	Manufacturing methods for piston rings	Aug. 1, 1999	13 years
		Manufacturing methods for camshafts	Oct. 1, 2004	8 years
Riken Automobile Parts (Wuhan) Co., Ltd.	China	Manufacturing methods for piston rings, seal rings, valves and other cast iron products.	Mar. 1, 2005	10 years

Capital Expenditure

(in millions of JPY)

	FY ended Mar. 31, 2012	FY ended Mar. 31, 2011	FY ended Mar. 31, 2010
Group	2,848	2,305	2,620
Automotive/Industrial Machinery Component	2,653	1,773	2,326

Automotive/Industrial Machinery Component Division
-The Company invested in machining and surface-treatment facilities at its own plants in general; and in casting facilities at its subsidiary in Indonesia.

Planned Capital Investments

(As of Mar. 31, 2012)

Company Office (Location)	Purpose	Planned investment amount (in millions of JPY)
Kashiwazaki Plant (Niigata Prefecture, Japan)	Installing production facilities for making piston rings and auto parts	1,481
P. T. Pakarti Riken Indonesia Head office plant (Surabaya, Indonesia)	Installing new equipment to produce auto parts	1,857
Riken Automobile Parts (Wuhan) Co., Ltd.	Installing new equipment to produce auto parts	594