Financial Overview

(in million JPY)

	FY ended Mar. 31, 2014	FY ended Mar. 31, 2013	Rate of Change (%)	Factors
Overall
Sales	181,517	154,518	17.5	-
Operating income	14,121	11,392	24.0	-
Ordinary income	13,852	11,815	17.2	-
Net income	8,020	7,537	6.4	-
Japan
Sales	41,519	38,725	7.2	-Higher sales resulted from a customer launching commercial operations at a new plant, robust sales of new models, and recovery in automotive production because of last-minute, new-car-buying demand that arose before the consumption tax increase went into effect in Japan.
Operating income	3,179	3,353	(5.2)	-Operating income fell because of the Company’s change in product mix, and incurring higher costs in connection with production increases and launching new models.
North America
Sales	60,613	55,495	9.2	-Sales increased because of greater production volume and favorable currency translation.
Operating income	2,558	1,874	36.5	-Greater income resulted from higher product sales, and sales of die facilities in connection with launching new models.
Europe
Sales	9,472	9,728	(2.6)	-Lower production levels and lower sales of die facilities
Operating income	889	1,113	(20.1)
Asia
Sales	32,550	23,421	39.0	-Unit production saw a slow down because of the sluggish economy and stricter loan screening, even though sales-subsidies continued in Thailand. In India, higher production levels and favorable currency translation contributed to sales increase.
Operating income	4,010	3,370	19.0	-Even though sales were higher, the Company incurred a loss in launching a new production facility in Indonesia and costs connected with procuring die facilities.
China
Sales	30,698	21,362	43.7	-Sales recovered significantly after the boycott to buy Japanese vehicles ended, supported by favorable currency translation.
Operating income	2,982	1,054	182.9	-Revenue increased and sales of die facilities for new models increased, offsetting depreciation costs and higher labor costs.
South America
Sales	6,662	5,784	15.2	-Increased production levels, launch of motorcycle-parts production, favorable currency translation
Operating income	465	707	(34.2)	-Higher labor costs and higher repair and maintenance costs

New Company

<USA>
-The Company announced that it has established G-TEKT North America Corporation in Ohio, U.S.A. to mass-produce hot stamping products. Local demand for high-strength and lightweight hot stamping components is growing in the North American market, as automakers are working to reduce vehicle weight. The new subsidiary is capitalized at USD 22 million (approximately JPY 2.2 billion) fully invested by the Company. G-TEKT North America will take over the Group's development operations in the region that have been carried out at the Company's existing U.S. subsidiary, which also handles sales operations. Faced with increasing demand from its major customer Honda to engineer products for new vehicle models, the Company is poised to enhance its development capability and efficiency in the market through the separation of its sales and development functions. (From an article in the Nikkan Jidosha Shimbun on May. 27, 2013)
 

Restructuring

G-TEKT Indonesia Manufacturing absorbs AMI, formerly joint venture with H-One
-On March 17, 2014, the Company merged its two Indonesian manufacturing subsidiaries, PT. G-TEKT Indonesia Manufacturing (G-TIM) and PT. Auto-Body Manufacturing Indonesia (AMI), in order to focus its management resources and increase its business efficiency. Specifically, G-TIM absorbed AMI, formerly a joint venture between G-TEKT and H-One Co., Ltd. Prior to the integration, G-TEKT dissolved its joint venture with H-One with an eye toward consolidating its Indonesian operations.

Contracts

<BMW>
-The Company received the first contract from BMW to supply stamped parts for MINI models. Delivery is scheduled to begin this fall. Currently, approximately 70 percent of the Company's consolidated sales are generated through business with Honda. Meanwhile, the supplier is increasing business with Japanese automakers other than Honda, aiming to expand profit-earning opportunities. In Europe, the Company's revenue is affected by a slowdown in automotive sales due to the economic stagnation. By winning new contracts from European automakers, the Company is poised to raise the operational level of its UK plants. The contracts the Company has received from BMW include small and middle-sized stamping parts for two models. After starting delivery of stamped parts for one BMW model in November 2013, the Company will also begin supplying those components for the other model in the summer of 2014. Production will take place at the Company's Europe Manufacturing Ltd. in the UK. (From an article in the Nikkan Jidosha Shimbun on May. 17, 2013)

Major contracts (As of Mar. 2014)

Production Facilities	Customers	Models
Japan (4 plants)	Honda	Accord, CR-V, STEP WGN, Insight, Freed, Fit, N-BOX, N-ONE, Odyssey, N-WGN, Vezel, Acura RLX
	Subaru	Impreza, Legacy, Forester, BRZ, Subaru XV, Exiga, Levorg
	Nissan	GT-R
	Mitsubishi Fuso	Canter, Fighter
	Daihatsu	TanTo, Move
North America (6 plants)	Honda	Accord, CR-V, Civic, Odyssey, Pilot, Ridgeline, Cross Tourer
	Acura	MDX, RDX, TL, ILX
	Subaru	Legacy, Tribeca
	Toyota	Corolla, Tundora、RAV4, Matrix, Highlander, Venza, Lexus RX350
Europe (3 plants)	Honda	Civic, CR-V, Jazz
	Toyota	Auris, Yaris, Avensis
	BMW	MINI
China (4 plants)	Honda	Accord, Accord Crosstour, Odyssey, CR-V, Civic, Fit, City, Everus, Crider, Jade, Stream
	Nissan	Bluebird Sylphy, Teana, Tiida, Livina, Qashqai, NV200, A60
	Toyota	Yaris, Corolla, Camry, Highlander, Ez
	Mitsubishi	ASX, Pajero Sport
Asia (7 plants)	Honda	Civic, Accord, CR-V, City, Jazz, Freed, Brio, Brio Amaze, MPV
	Mazda	Fiesta, Axela, BT50, Everest, Ranger
	Toyota	Hilux Vigo, Fortuner, Corolla, Vios, Yaris, Camry
	Isuzu	D-MAX, MU7
	Nissan	Navara, March
	Suzuki	Swift, Ertiga
	Mitsubishi	Mirage
South America (1 plant)	Honda	Civic, Jazz, City

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

R&D Expenditure

(in million JPY)

	FY ended Mar. 31, 2014	FY ended Mar. 31, 2013	FY ended Mar. 31, 2012
Overall	459	415	199

R&D Structure

-R&D activities involving new technologies and new products are conducted at the Company's main Technology Development Department.

-21 engineers work at the Product Development Section as of March 2014.

R&D Activities

-Major R&D activities and achievements in the FY, which ended Mar. 31, 2014

• Developing hot-press technology
• Developing forming technology to manufacture high tensile strength steel sheets
• Developing non-destructive inspection technology to test spot-welded points.
• Developing stamping technology for transmission components
• Developing technology to create forming simulations
• Developing technology that contributes to reducing vehicle weight

Technology Licensing-out Agreement

(As of Mar. 31, 2014)

Partner	Country	Details	Period
Jefferson Industries Corporation	USA	Nonexclusive license involving production, use, and sales rights regarding technological and production expertise on automotive parts, stamping dies, and jigs	2003.10.01 - 2006.09.30 automatic extension every year thereafter
Jefferson Elora Corporation	Canada	Nonexclusive license involving production, use, and sales rights regarding technological and production expertise on automotive parts, stamping dies, and jigs	1997.03.31 - 2002.03.30 automatic extension every 5 years thereafter
Jefferson Southern Corporation	USA	Nonexclusive license involving production, use, and sales rights regarding technological and production expertise on automotive parts, stamping dies, and jigs	2001.05.31 - 2006.05.30 automatic extension every year thereafter
Austin Tri-Hawk Automotive Inc.	USA	Nonexclusive license involving production, use, and sales rights regarding technological and production expertise on automotive parts, stamping dies, and jigs	1998.01.25 - 2001.01.24 automatic extension every year thereafter
G-KT do Brasil Ltda.	Brazil	Nonexclusive license involving production, use, and sales rights regarding technological and production expertise on automotive parts, stamping dies, and jigs	1997.05.30 - 2002.05.29 automatic extension every year thereafter
Auto Parts Alliance (China) Ltd.	China	Nonexclusive license involving production, use, and sales rights regarding technological and production expertise on automotive parts, stamping dies, and jigs	2011.07.01 - 2016.06.30
Wuhan Auto Parts Alliance Co., Ltd.	China	Nonexclusive license involving production, use, and sales rights regarding technological and production expertise on automotive parts, stamping dies, and jigs	2011.04.01 - 2016.03.31
G-TEKT Europe Manufacturing Ltd.	U.K.	Nonexclusive license involving production, use, and sales rights regarding technological and production expertise on automotive parts, stamping dies, and jigs	2000.02.01 - 2004.01.31 automatic extension every year thereafter
G-TEKT (Thailand) Co., Ltd.	Thailand	Nonexclusive license involving production, use, and sales rights regarding technological and production expertise on automotive parts, stamping dies, and jigs	1997.04.01 - 2002.03.31 automatic extension every year thereafter
G-TEKT Eastern Co., Ltd.	Thailand	Nonexclusive license involving production, use, and sales rights regarding technological and production expertise on automotive parts, stamping dies, and jigs	1996.05.01 - 2001.04.30 automatic extension every year thereafter
G-TEKT India Private Ltd.	India	Nonexclusive license involving production, use, and sales rights regarding technological and production expertise on automotive parts, stamping dies, and jigs	2008.06.26 - 2013.06.25 automatic extension every year thereafter
PT. G-TEKT Indonesia Manufacturing	Indonesia	Nonexclusive license involving production, use, and sales rights regarding technological and production expertise on automotive parts, stamping dies, and jigs	2013.09.01 - 2016.08.31 automatic extension every year thereafter

Capital Expenditure

(in million JPY)

	FY ended Mar. 31, 2014	FY ended Mar. 31, 2013	FY ended Mar. 31, 2012
Overall	21,056	18,181	12,698

Capital Investments in FY ended Mar. 31, 2014
-The Company spent JPY 5,035 million in capital investments in Japan and JPY 3,189 million in China to launch new models. It invested JPY 5,241 million in order to increase its production capacity in Indonesia, constructing new plant buildings and acquiring facilities and equipment. It also invested JPY 778 million in Brazil to construct a new plant building and acquire facilities and equipment.

Investments Outside Japan

<Mexico>
-The Company will build a new plant in Mexico. The plant will produce small stamping parts for continuously variable transmissions (CVTs) and other automotive components. The new plant is scheduled to start operations at the end of 2015 or in 2016. The Company's main customer, Honda Motor Co., Ltd., is starting CVT production in Mexico in the latter half of 2015. Another customer and Nissan's affiliated transmission maker, Jatco Ltd., is also expanding its CVT production in Mexico. Anticipating further growth in local demand for CVT components, the Company will establish its supply base in Mexico to boost its CVT components sales. (From an article in the Nikkan Jidosha Shimbun on March 28, 2014)

<Thailand>
-The Company announced that it will construct an additional factory at G-TEKT Eastern Co., Ltd. (G-TEC2), its new Thai plant. G-TEC2 is now under construction at the Gateway City Industrial Estate in Chachoengsao Province, and production is scheduled to start in 2014. As Honda Motor's second Thai plant is scheduled to become operational in 2015, G-TEKT has decided to make an additional investment to expand its new facility. G-TEKT originally intended to invest approximately JPY 4 billion in G-TEC2. G-TEC2 will serve as a second plant of G-TEKT Eastern Co., Ltd. based in the Eastern Seaboard Industrial Estate, Rayong. Using transfer and blanking presses, and welding equipment, G-TEC2 will produce body structural components also for the facilities of Toyota and Isuzu located in the same Industrial Estate. (From an article in the Nikkan Jidosha Shimbun on September 6, 2013)

Planned Capital Investments

(As of Mar. 31, 2014)

Plant	Location	Equipment to be installed	Estimated amount of investment (in millions of yen	From	To	Purpose of investments
Saitama Plant	Saitama Pref., Japan	Equipment for manufacturing auto parts (dies, jigs and tools)	2,541	Aug. 2013	Feb. 2015	Dealing with new model
G-TEKT (Thailand) Co., Ltd.	Ayutthaya, Thailand	Equipment for manufacturing auto parts (dies, jigs and tools)	7,229	Nov. 2012	Oct. 2016	Dealing with new model
G-TEKT Eastern Co., Ltd.	Rayong, Thailand	Equipment for manufacturing auto parts (stamping and welding equipment)	5,104	Jan. 2014	Dec. 2016	Increasing production capacity
		New facilities at production plant	3,535	Sep. 2012	Dec. 2014	Increasing production capacity
PT. G-TEKT Indonesia Manufacturing	Karawang, Indonesia	Equipment for manufacturing auto parts (dies, jigs and tools)	3,361	Dec. 2013	May 2016	Dealing with new model
		New facilities at production plant	2,737	Mar. 2012	Dec. 2016	Increasing production capacity
Auto Parts Alliance (China) Ltd.	Guangdong Province, China	Equipment for manufacturing auto parts (dies, jigs and tools)	6,715	Dec. 2012	Oct. 2016	Dealing with new model
		Equipment for manufacturing auto parts (stamping and welding equipment)	3,765	Dec. 2013	Dec. 2016	Increasing production capacity