Financial Overview

(in millions of JPY)

	FY ended Dec. 31, 2013*	FY ended Mar. 31, 2013	Factors
Overall
Sales	14,217	21,897	-
Operating income	256	249	-
Ordinary income	507	536	-
Net income	335	329	-
Electrical Products Division
Sales	7,847	11,928	-
Operating income	616	870	-
Motor Division
Sales	6,369	9,969	-Sales of automotive motors decreased, mainly because the Company’s major customer moved production overseas.
Operating income	2	(66)	-

*Due to changes made to the Company's accounting term, FY ended Dec. 31, 2013 covers a 9-month period from April 1, 2013 through December 31, 2013 in the Group's financial statements.

Joint Venture

-In 2013, the Company announced that it will establish a joint venture with Germany-based Mahle GmbH in Samut Prakan Province, Thailand in April 2014. In order to meet growing demand in the country, the new company will manufacture electric components and motors for automobiles, starting in the first half of 2015. It will be capitalized at THB 100 million (approximately JPY 300 million), of which 51 percent will be provided by Kokusan Denki and the remaining 49 percent will be provided by Mahle. (From an article in the Nikkan Jidosha Shimbun on November 29, 2013)

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

R&D Expenditure

(in millions of JPY)

	FY ended Dec. 31, 2013	FY ended Mar. 31, 2013	FY ended Mar. 31, 2012
Overall	221	251	233
-Electrical Products Division	94	133	142
-Motor Division	118	111	90

R&D Activities

Electrical Products Division
-Continually working to develop optimal ignition and fuel-injection systems for engines.

Motor Division

-The Motor Division is developing smaller motors for vehicle control systems. It is also developing mechatronics products by applying its technology to integrate motors and drivers of vehicle control units.

Capital Expenditure

(in millions of JPY)

	FY ended Dec. 31, 2013	FY ended Mar. 31, 2013	FY ended Mar. 31, 2012
Overall	426	1,177	909

-During FY ended Dec. 31, 2013, the Company made investment in establishment of a rationalized production line for electrical products, rationalization of facilities to save energy and introduce IT, and installation of new molds to allow the Company to respond to orders for new products and to update old facilities.

-The Major Investments in FY 2013.

(in millions of JPY)

Segment	Amount	Main facilities
Electrical Products Division	341	Electrical components rationalization facilities, etc.
Motor Division	85	Preparing new motor production lines to respond to vehicle model changes

Planned capital investments

(As of Dec. 31, 2013)

Site name	Location	Type of facility and activities	Planned investment amount (million yen)	From	To
Gotemba factory	Shizuoka Pref., Japan	Streamlining motor production operations	97	Jun. 2014	Dec. 2014
Headquarters factory	Shizuoka Pref., Japan	Establishment for new plant	340	Nov. 2014	Dec. 2015