Financial Overview

(in million JPY)

	FY2009	FY2008	Rate of Change (%)	Factors
Overall
Sales	1,836,352	2,121,978	(13.5)	-
Operating income	51,728	23,527	119.9	-
Ordinary income	68,206	37,773	80.6	-
Current net income	28,708	17,237	66.5	-
Automotive related business
Sales	816,623	917,125	(11.0)	-Demand for wire harnesses and anti-vibration rubber decreased and the price of copper dropped, due to production cuts by automakers worldwide in the first half of the year.
Operating income	34,526	6,142	462.1	-Mainly in the wire harness segment, the Company successfully reduced its labor costs and other fixed costs. It also optimized its production structure by migrating its production operations to low-cost regions.

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

Outlook for FY2010

(in billions of JPY)

	FY2010	FY2009	Year-on-year Fluctuation
Sales	2,000.0	1,836.4	163.6
-Automotive related business	915.0	816.6	98.4
Operating income	100.0	51.7	48.3
Ordinary income	120.0	68.2	51.8
Net income	60.0	28.7	31.3
R&D Expenditure	75.0	72.3	2.7
Investment Expenditure	110.0	73.3	36.7
-Automotive related business	48.0	29.6	18.4

R&D Expenditure

(in million JPY)

	FY2009	FY2008	FY2007
Overall	72,259	72,988	68,373
Automotive related business	37,512	38,890	40,891

R&D Activities

Wire harnesses / in-vehicle electronic equipment
-R&D activities are mainly conducted at AutoNetworks Technologies, Ltd., which is jointly owned by the Company and Sumitomo Wiring Systems, Ltd. R&D activities are mainly focused on developing new products meeting safety, comfort and environmental needs.

-Wire harnesses: The Company established the architecture to develop wire harnesses suitable for applications in next-generation, in-vehicle systems. It is now developing the fundamental technology that is needed.

-In-vehicle electronics devices: The Company isnow developing electronics devices such as PDs (power distributors)and next-generation in-vehicle LAN (Local Area Network) unitsin order to respond to the rapidadvances taking place in IT. TheCompany is also launching systems with advanced features and/or networkingcapabilities.

-Environment: The Company is now developing lighter wire harnessesby usingmaterials such as lighter aluminum wiresand smaller connectors. It also is developing high-voltage harnesses and components for EVs (electric vehicles) and HEVs (hybrid electric vehicles),which are two growing markets.

-The Company has succeeded in development and commercial production of the AZ91 magnesium alloy sheet through a unique casting and rolling process for the first time in the world. The new alloy sheet exceeds conventional products in terms of strength and corrosion resistance. AZ91 alloy is a magnesium alloy to which 9 percent of aluminum and 1 percent of zinc are added to improve its corrosion resistance performance. Due to difficulty in processing, the conventional AZ91 alloy has not been used in the form of a sheet. The new magnesium alloy sheet has achieved a high strength of 380 MPa by more than 1.5 times, and an elongation of over 10 percent by several times, compared with the cast sheet, but, in terms of the stamping workability, it has attained a level equivalent to that of the AZ31 alloy sheet, which is already widely used. (From an article in the Nikkan Jidosha Shimbun on Jan. 15, 2009)

Capital Expenditure

(in million JPY)

	FY2009	FY2008	FY2007
Overall	73,306	131,597	119,887
Automotive related business	29,609	69,567	69,075

-The Company invested in the automotive business to increase production and improve the efficiency of wire harnesses and vibration isolating rubber.

Capital Investment Plan (FY2010)

-The Company plans to invest 110,000 million yen in FY2010.
-Its Automotive Business Division plans to invest 48,000 million yen mainly in its facility that produces wire harnesses and vibration-isolating rubber.