Financial Overview

(in millions of JPY)

	FY ended Mar. 31, 2014	FY ended Mar. 31, 2013	Rate of Change (%)	Factors
Overall
Sales	62,108	59,961	3.6	1)
Operating income	5,031	4,685	7.4	-
Ordinary income	5,509	5,196	6.0	-
Current net income	3,462	3,984	(13.1)	-

Factors
1) Sales
<Japan>
-Sales totaled JPY 36,627 million, down 6.8% year-on-year. A major reason for the fall was a decrease in demand for automotive rear-view mirrors, the Company's major products.

<Asia>
-Sales reached JPY 16,609 million, up 12.2% year-on-year due to the addition of PT. Murakami Delloyd Indonesia to the Company's consolidated financial statements. In addition, favorable currency translation was a factor to the better performance.

<North America>
- Sales totaled JPY 8,871 million, up 51.8% from the previous year. A major reason for the significant increase was a rise in vehicle production due to a recovery in consumer spending and greater demand in consumers buying new vehicles as a replacement to their aging vehicle. Favorable currency translation was another factor to the sales increase.

New Company

<Mexico>
-The Company announced that it will establish a wholly-owned subsidiary to manufacture automotive rear view mirrors in Zacatecas, Mexico. This is the first time that the Company will set up its subsidiary in the country. The new company, which will be capitalized at MXN 40 million (JPY 300 million), will construct a plant by June 2015. Production is scheduled to start in 2016, and sales are expected to reach JPY 2 billion in 2018. The Company is poised to meet the growing demand in Mexico and enhance its competitiveness in the North American market. (From an article in the Nikkan Jidosha Shimbun on February 20, 2014)

<Thailand>
-The Company will set up its new fully-owned subsidiary in Thailand in late September 2013. The subsidiary will be in charge of designing and preparing production of rear-view mirrors. The subsidiary, Murakami Corporation (Thailand) Ltd., is located in the city of Bangkok and capitalized at THB 20 million (JPY 60 million). By establishing this subsidiary, the Company aims to enhance its comprehensive management and offer its products and services more swiftly and efficiently in ASEAN and Indian markets. These markets are the Company's core strategic areas in its global expansion plan. (From an article in the Nikkan Jidosha Shimbun on September 18, 2013)

Restructuring

<Japan>
-The Company announced that it will consolidate all businesses of its subsidiary, Shonan Optical Thin-film Laboratories, Inc., effective March 31, 2014. The subsidiary, which will be dissolved upon this merger, has been engaged in vacuum deposition processing of optical parts. (From a press release on October 15, 2013)

<China>
-In June 2013, the Company announced that it will dissolve its Chinese JV with Olsa S.p.A. of Italy. The JV was established in 2011 to manufacture and sell automotive lamps in China and Asia. The two parties agreed to dissolve it because the joint management will cause a delay in responding to the changes in the market situation. Jiaxing Olsa Murakami Corporation, located in Jiaxing, Zhejiang, China, was funded 55% by Olsa and 45% by the Company. On June 10, with the dissolution of the partnership, the Company transferred all of its shares in the JV to Olsa. The transfer price of USD 1,665 thousand (approx. JPY 160 million) was the same as the acquisition price. The Company says this transfer will only have a minor impact on business performance of both companies. (From an article in the Nikkan Jidosha Shimbun on Jun 12, 2013)

Outlook for FY ending Mar 31, 2015

(in millions of JPY)

	FY ending Mar 31, 2015 (Estimate)	FY ended Mar. 31, 2014 (Result)	Rate of Change (%)
Sales	62,200	62,108	0.1
Operating income	4,700	5,031	(6.6)
Ordinary income	5,000	5,509	(9.2)
Net income	3,050	3,462	(11.9)

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

R&D Expenditure

(in millions of JPY)

	FY ended Mar. 31, 2014	FY ended Mar. 31, 2013	FY ended Mar. 31, 2012
Overall	367	315	382

R&D Structure

-The R&D group and the technical group are the main functions conducting R&D activities, which are focused on researching automotive information-conveyance systems and highly functional fine glass.
-The Company has 33 members total working in the R&D group and technical group. (As of Mar. 31, 2014)

R&D Activities

The focus of R&D activities are as follows:
1.Vehicle information conveyance system
-Development of environmentally-conscious mirror system
-Development of blind spot eliminating system
-Development of energy saving mirror system (light weight and energy saving) 

2. High function fine glass
-Development of various types of optical filters and mirrors
-Development of light-adjusting filters (mirrors)

Licensing of Technology to Other Companies

(As of Mar. 31, 2014)

Partner	Contract	Contract Period
Ken Sean Factory Co., Ltd. (Taiwan)	To supply design and manufacturing technology on Automotive Rear-view Mirrors to automakers in Taiwan (except Ford Lio Ho Motor) including Japanese automakers	Feb. 1, 2014 - Jan. 31, 2015*
Ampas Industries Co., Ltd. (Thailand)	To supply design and manufacturing technology on Automotive Rear-view Mirrors	Dec. 29, 2013 - Dec. 28, 2014*
Delloyd Industries (M) Sdn. Bhd. (Malaysia)	To supply design and manufacturing technology on Automotive Rear-view Mirrors	Dec. 5, 2013 - Dec. 4, 2014*
Fu-Hwa Glass Co., Ltd. (Taiwan)	To supply design and manufacturing technology on Automotive Rear-view Mirrors to automakers in Taiwan (except Kuozui Motors) including Japanese automakers	Apr. 1, 2013 - Mar. 31 2014*
Tata Ficosa Automotive Systems, Ltd. (India)	To supply design and manufacturing technology on Automotive Rear-view Mirrors	From Sep. 1, 2004 to the completion of delivery of the products subject to the contract
Ficosa Do Brasil , Ltda. (Brazil)	To supply design and manufacturing technology on Automotive Rear-view Mirrors	From Sep. 1, 2004 to the completion of delivery of the products subject to the contract
Ficosa International S.A. (Spain)	To supply design and manufacturing technology on Automotive Rear-view Mirrors	Jun. 30, 2013 - Jun. 29, 2014*
Murakami Ampas (Thailand) Co., Ltd. (Thailand)	To supply design and manufacturing technology on Automotive Rear-view Mirrors	Jul. 1, 2013 - Jun. 30, 2014*
Murakami Manufacturing U.S.A. Inc. (USA)	To supply design and manufacturing technology on Automotive Rear-view Mirrors	Jan. 1, 2014 - Dec. 31, 2014*
Murakami Manufacturing (Thailand) Co., Ltd. (Thailand)	To supply design and manufacturing technology on Automotive Rear-view Mirrors	Jun. 30, 2013 - Jun. 29, 2014*
Jiaxing Murakami Corporation (China)	To supply design and manufacturing technology on Automotive Rear-view Mirrors	Aug. 1, 2013 - Jul. 31, 2014*
Metagal Argentina S.A. (Argentina)	To supply design and manufacturing technology on Automotive Rear-view Mirrors	Jan. 27, 2014 - Jan. 26, 2015*

* Contracts are renewed every year if both parties agree.

Investment Expenditure

(in millions of JPY)

	FY ended Mar. 31, 2014	FY ended Mar. 31, 2013	FY ended Mar. 31, 2012
Japan and Company-wide (common throughout)	1,189	1,300	4,846
Asia	1,691	2,034	649
North America	191	109	24
Total	3,072	3,444	5,520

Capital Investments in FY ended Mar. 31, 2014
Mirror system business
-At its rear-view mirror production plants in Japan, the Company invested to improve and streamline operations, perform quality control activities, and get production operations ready to manufacture new products, in order to increase productivity.
-At its plants in Asia and North America, the Company invested in facilities and equipment to increase production capacity and enhance productivity.

Planned Capital Investments

(As of Mar. 31, 2014)

Name (Location)	Type of facility	Planned total investment (in million JPY)	Start	Planned completion	Increase in capacity
Fujieda Plant (Shizuoka Pref., Japan)	Production facilities for Automotive Rear-view Mirrors	830	Oct. 2013	Mar. 2015	*
	Production facilities for fine glass	440	Nov. 2013	Mar. 2015	*
	Other	134	Nov. 2013	Mar. 2015	*
Ohigawa Plant (Shizuoka Pref., Japan)	Production facilities for Automotive Rear-view Mirrors	287	Nov. 2013	Mar. 2015	*
	Other	141	Nov. 2013	Feb. 2015	*
Tsuiji Plant (Shizuoka Pref., Japan)	Production facilities for Automotive Rear-view Mirrors	319	Nov. 2013	Feb. 2015	*
	Other	1	Feb. 2014	Aug. 2014	*
PT.Murakami Delloyd Indonesia (West Java, Indonesia)	Land	600	Jun. 2014	Jun. 2014	New plant site
Murakami Manufacturing Mexico, S.A. de C.V. (Zacatecas, Mexico)	New plant	785	Aug. 2014	Apr. 2015	North American plant

* Hardly any direct investments were made to actually increase capacity in terms of rebuilding its production and logistics frameworks.