NISSIN KOGYO CO., LTD. Business report FY2006

Business Highlights

Financial overview

In million JPY Mar. 2007 Mar. 2006 Rate of Change (%) Factors
Sales 187,878 166,796 12.6 see note 1) below
Operating income 20,666 17,661 17.0 see note 2) below
Ordinary income 21,618 18,374 17.7
Current net income 12,375 9,046 36.8

1) The income increased on a quarter-to-quarter basis, with the Company achieving a record-high performance due to increased sales and strong sales of 2006 and 2007 model year vehicles in the domestic Japan market. The increase was also the result of winning new orders for 2007 model vehicles, strong sales of 2006 model year vehicles, positive foreign exchange rate translation in the North American market, a recovery in the Indonesian market starting from the third quarter, greater sales volume in China; plus strong sales and favorable foreign exchange rate translation in other markets.

2) Operating income, ordinary income, and current net income all increased,  achieving record-high performance for the Company as a result of aggressive cost reduction activities and increased revenue, despite increases in materials prices.

Construction of a New Production Facility
The Company will build a new plant, which serves as a production base of automobile components for Nissin BRAKE DO BRAZIL, in Sao Paulo State, Brazil, in response to a rapid growth of the automobile market in Brazil and a strong demand from its customers. See Investment for details

Challenges for FY2007
-The Company established the following objectives for the near future in order to achieve its management goals over the mid-to-long term.

1. To establish a low-cost structure through innovative product creation.
2. To create next-generation products designed to protect the environment and ensure safety.
3. To foster new, key operating locations demonstrating a high potential for growth 4.To speed up creating a business structure that is minimally affected by currency exchange rates.
-To expand the range of products the Company produces internally at all sites in and outside of Japan, as well as to reinforce mutual supply/delivery among its sites.
5. To improve profitability in Japan and North America 
- To increase productivity
6. To establish a solid and secure business structure by strengthening risk management.
- To deploy environmental management globally.
- To enhance its internal control system 


The Company worked on R&D activities that enables it to build a global production structure. In this effort, the Company focused on development of basic brake systems and automatic mechatronics control systems, creating design technologies for reducing weight mainly by using aluminum products, and developing materials and manufacturing methods in order to reduce the weight of motorcycles and automobiles as well as to improve the safety and comfort of vehicles. It also carried out development activities on full brake systems under joint cooperation with automakers.
  March 2007 March 2006 March 2005
R&D expense (in million JPY) 6,870 6,367 6,080
The number of staff N.A 451 396

Major R&D achievements in automobile parts

-Two customer companies equipped their vehicles with two separate hill stop valve models, each company mounting a different one. These valves provide a smoother drive when vehicles start ascending hills. 
Four ABS/VSA (Vehicle Stability Assist) models, which are expected to contribute to ride comfort and vehicle safety were equipped for the first time as a part of the Company's model deployment measures.

-Basic brake development
The Company developed a tie-rod type master power system, a lightweight vacuum booster, which is anticipated to improve performance and reduces weight. It was equipped on one vehicle model.

-Development of weight reduction technology:
One maker equipped the Company's aluminum knuckle on one of its vehicle models. This knuckle is anticipated to reduce weight. 

Major R&D achievements for automobile parts

-Development of  mechatronics-based automated control systems:
The Company developed regenerative brake systems for hybrid vehicles. These systems are now being used in Honda's new Civic Hybrid. Also, the Company's new VSA (Vehicle Stability Assist) systems are featured on two vehicle models. 

-Development of weight reduction technology:
As to its single-unit aluminum products, rear knuckles are being installed on one more vehicle model each in Japan and overseas, respectively. In addition, its rear calipers with aluminum bodies are being installed on one more model.

Investment Activities