Financial overview

(In millions yen)	FY2007	FY2006	Rate of Change (%)	Factors
Overall
Sales	132,847	117,120	14.7	- Overall sales grew primarily due to greater sales of new cable products.
Operating Profit	5,262	4,879	(7.0)	- Despite the Company's initiatives to reduce costs, the effects of any achievements gained were not enough to offset the losses.
Ordinary profit	6,440	6,532	(1.1)	- The Company received greater interest and dividends
Net profit	4,114	3,628	(11.0)	- An increase in minority shareholder's interest
Japan
Sales	68,224	61,631	11.8	- Sales grew, supported by greater sales to major customers.
Operating Profit	4,007	2,898	11.4	- The Company was able to keep its production costs from rising in spite of surging material costs.
North America
Sales	48,285	41,363	10.2	- Sales increased, thanks to greater revenue earned at its production and sales subsidiary in Mexico.
Operating Profit	(568)	692	(42.4)	- Operating profit decreased due to increased costs to hike production in Mexico.
Asia
Sales	29563	25,218	39.4	- Although demand weakened in Indonesia, the Company enjoyed greater sales in China and Korea.
Operating Profit	2,073	1,662	20.8	- Operating income increased, supported by greater profit earned in China and Korea.
Others
Sales	5,511	3,855	21.6	- Sales increased in UK, thanks primarily to growing business with existing customers.
Operating Profit	(100)	(242)	-	- The operating loss grew larger due to costs incurred for increasing production volume.

New subsidiary
The Company has established a new company, Guangzhou HI-LEX Control Cable System Inc., in Zengcheng City, Guangzhou, Guangdong Province of China, as of December 10, 2007. The Company plans to ensure a highly-efficient supply system for the Japanese automakers based in China and further expand its production & sales activities in the region. Guangzhou HI-LEX Control Cable System Inc., which was capitalized at 7.8 million U.S. dollars with a workforce of 350, is due to become a consolidated subsidiary of the Company upon completion of capital injection procedures. The new company manufactures and sells control cables and window regulators. (From a press release on Dec. 10, 2007)


Business plans for fiscal year 2008 and after
-The Company aims to establish a global production and development structure with a focus on Japan, the U.S.A., Europe, and Asia.

1. North America:
1) In fiscal year 2008, the Company will start manufacturing large door modules for Chrysler vehicles. 
2) In fiscal year 2008, the Company will start manufacturing window regulators for heavy-duty trucks. 
3) The Company will establish Daedon Hi-Lex Alabama. The new subsidiary will begin producing door modules for Kia Motors and Hyundai Motor in November, 2009.

2. South America
1) In 2008, the Company and Sila of Italy will establish a joint-venture company in Brazil. Production at this new facility is scheduled to begin in May, 2008.

3. Europe
1) In 2008, the Company will expand its production facility at Hi-Lex Hungary LLC.

4.China
1) Chongqing TSK Control Cable System Inc. will move to the Chongqing Economic and Technological Development Zone in order to expand its facility and increase its production capacity. (Production is scheduled to begin in May, 2008)
2) The Group will establish Guangzhou Hi-Lex in order to cope with greater demand from Japanese automakers operating in the area. (Production is scheduled to start in April, 2008)
3) The Group will establish Changchun TSK Automotive Inc. to supply parts to the northeastern region in China. (Production is scheduled to begin in December, 2008)

5. Asia
1) HI-LEX India Private Ltd. will set up its second plant in order to increase its production capacity. (Production is scheduled to begin in December, 2008)
2) In 2008, Daedon Hi-Lex will start building a new plant in Ulsan City in order to enhance its support to Hyundai Motor. (Production is scheduled to begin in October, 2009)

R&D Expenditure

(in millions yen)	FY2007	FY2006	FY2005
Total	1180	912	852

New materials
-The Company developed high-performance and cost-efficient cables by using low-cost, and highly lubricating plastic composites.

New technologies
-The Company developed push-pull inner cables using irregularly shaped wire rods, which provide better lubrication. The Company further upgraded this technology by incorporating lubricating plastic technology, which is available at low-cost. These technologies are likely to be used in making high-performance torque cable parts such as key cylinders and power lift gates.

New products
Cable-less electronic and electric technologies
-The company is utilizing cable-less technologies in power slide door systems, power lift gate systems, electric assist parking brakes, electric automatic transmissions, manual transmissions, new wheelchair locking devices, etc.