Financial Overview

( in millions of JPY )

	FY2007	FY2006	Rate of Change (%)	Factors
Overall
Sales	319,765	353,083	(9.4)	-Sales decreased year-on-year due to a significant drop in the car assembly business.
Operating profit	8,799	10,469	(15.9)	Operating profit and ordinary profit decreased from last year's results. The following are some of the factors behind these drops:   -a decrease in profit as a result of declining revenues from the car assembly business in Japan; -a rise in depreciation costs following some legal changes;  -increased costs for projects initiated to expand capacity;  -rises in sales expenses and general administration costs;  -losses from exchange-rate translation for the North American business.
Ordinary profit	8,124	9,861	(17.6)
Net income	7,360	5,387	36.6
Automotive components field
Sales	196,435	183,774	7.0	-Sales at the automotive component division increased year-on-year because of the following factors: <Japan> -Sales volume of each product saw a slight increase. <North America> -Sales grew in North America, thanks to greater business at AY Manufacturing Ltd.; Yachiyo Manufacturing of Alabama LLC; and US Yachiyo Inc. in the U.S.A. The Company also posted gains from exchange-rate translation. <Asia> -Sales in Asia went up year-on-year, thanks to increased business at Goshi-Thanglong Auto-Parts Co., Ltd. in Vietnam; Siam Yachiyo Co., Ltd. in Thailand, and Yachiyo Zhongshan Manufacturing Co., Ltd. in China. The Company also posted gains from exchange-rate translation.
Automobile Assembly
Sales	122,943	169,024	(27.3)	Sales at the automotive assembly division decreased year-on-year due to the following factors: -the initial momentum of brisk sales of new vehicle models, which debuted in the last fiscal year, waned; -there were no new vehicle model launches during the fiscal year; -sales of vehicles such as the Honda Zest largely decreased.

Production structure
<USA>
-In April 2007, the Company announced that Yachiyo Mfg. of Alabama LLC will make capital investment and fortify its stamping operations.

-In April 2007, the Company announced that it will build a new plant to produce plastic fuel tanks at its campus of Yachiyo Mfg. of Alabama LLC, its subsidiary in Alabama, U.S.A., in a bid to fortify its business in North America.

<India>
-In December 2007, the Company announced that it would establish a new manufacturing subsidiary in Rajasthan Province, India.

>>>See Investment for more details


Tenth Medium-term business plan (April 1, 2008 through March 31, 2011)
Financial targets by end of plan:
-Sales of 430 billion yen (210 billion yen at the finished car business and 220 billion yen at the auto parts business)
-Profit margin of over 3.0 percent
-ROE of more than 10 percent 

Sales targets in units: 
-Plastic fuel tanks: 3,500,000 units (sales for FY2007 stood at 2,183,000 units)
-Sun roofs: 1,500,000 units (sales for FY2007 totaled 1,434,000 units)

R&D Expenditure

( in millions of JPY )

	FY2007	FY2006	FY2005
R&D	1,657	1,622	1,316

R&D structure
-R&D activities are conducted at both the Company and Goshi Giken Co., Ltd. 
Goshi Giken Co., Ltd. (Kumamoto Prefecture, Japan)


For automotive components, achievements  and continuing R&D activities involved the following:
(1)Launching mass-production of plastic fuel tanks for installation in new vehicles
(2) Development of metal honeycomb catalyst substrates (for two-wheeled vehicles) that meet domestic and overseas emission standards
(3) Research and development of new-design resin fuel tanks
(4) Research and development of elemental technology in the areas around sun roofs
(5) Research and development of new type of sun roof
(6) Research and development on environmental technology for sun roofs.
(7) Research and development on environmentally friendly plastic fuel tanks for motor cycles
(8) Research and development of catalysts (for two-wheeled vehicles) that meet domestic and overseas emission standards
(9)Research and development on press forming technology for aluminum materials that are in a semi-melted state.

Investment Expenditure

( in millions of JPY )

	FY2007	FY2006	FY2005
Group	21,874	10,181	7,490
Automotive components	15,339	8,991	5,739
Automobile Assembly	6,507	1,176	1,734

Overseas Investments
<USA>
-In April 2007, the Company announced that Yachiyo Mfg. of Alabama LLC, its subsidiary in Alabama, U.S.A., will make capital investment and fortify its stamping operations. Yachiyo Mfg. of Alabama LLC intends to establish an integrated stamping product processing system for an enhanced competitiveness in the United States by building an addition to its existing facility and bring in a highly-performance pressing machine. 27 million USD has been earmarked for these capital expenditures. (From a press release on Apr. 5, 2007)

-In April 2007, the Company announced that it will build a new plant to produce plastic fuel tanks at its campus of Yachiyo Mfg. of Alabama LLC,, in a bid to fortify its business in North America. The Company currently operates a plant in Ohio for the production of fuel tanks and the new plant becomes its second production base in North America. With the construction of an additional production facility The Company will meet an increasing demand for plastic fuel tanks. The Company will invest a total of 16 million U.S. dollars (approximately 192 million yen) in the new plant and plans to start its operations in January 2009. Alabama plant will put out 200,000 units of fuel tanks a year, which will consequently increase its total production volume of fuel tanks in North America to 1 million units a year. (From a press release on April 25, 2007)

<India>
-In December 2007, the Company announced that it would establish a new manufacturing subsidiary in Rajasthan Province, India. The Company plans to establish a subsidiary, which engages in the production and sales of automotive components including plastic fuel tanks, near Delhi around April 2008. The new Indian subsidiary, whose trade name has yet to be decided, will be capitalized at 300 million Indian rupees (approximately 800 million yen). Operations are scheduled to be commenced in January 2010. (From a press release on Dec. 27, 2007)

New facilities for automotive parts business

( in millions of JPY )

Purpose	Planned total investment	Starting	Planned completion	Remarks
Yachiyo Industry Co., Ltd.
Kashiwabara Plant (Saitama Prefecture, Japan)
-Production related facilities -R&D facilities	3,472	2007.07	2009.03	-Setting up production lines to respond to new supply agreements  -Streamlining and rationalizing operations -Increasing production capacity
Yokkaichi Plant (Mie Prefecture, Japan)
Production related facilities	15,260	2007.05	2009.03	-Acquiring a piece of land for a new plant site -Increasing production capacity  -Setting up production lines to respond to new supply agreements
Suzuka Plant (Mie Prefecture, Japan)
Production related facilities	1,706	2008.01	2009.01	-Setting up production lines to respond to new supply agreements  -Streamlining and rationalizing operations -Increasing production capacity
Kameyama Office (Mie Prefecture, Japan)
Production related facilities	1,892	2007.06	2009.02	-Increasing production capacity  -Setting up production lines to respond to new supply agreements  -Streamlining and rationalizing operations
Tochigi Research Center (Tochigi Prefecture, Japan)
R&D facilities	20	2008.06	2008.10	-Installing additional testing equipment
Domestic subsidiaries
Goshi Giken Co., Ltd. (Kumamoto Prefecture, Japan)
Production related facilities	2,070	2008.01	2009.03	-Setting up production lines to respond to new supply agreements  -Installing testing equipment -Increasing production capacity
Uemura Tech Co., Ltd. (Kumamoto Prefecture, Japan)
Production related facilities	1,093	2008.02	2009.03	-Setting up production lines to respond to new supply agreements -Streamlining and rationalizing operations -Revamping production equipment
Overseas subsidiaries
Yachiyo of America Inc. (Marion, Ohio, USA)
R&D facilities	1,196	2007.08	2008.12	North American research and development center
Ycchiyo Manufacturing of Alabama LLC (Steele, Alabama USA)
Production related facilities	4,949	2006.07	2009.06	-Increasing production capacity  -Revamping production equipment -Setting up production lines to respond to new supply agreements
AY Manufacturing Ltd. (Columbus, Ohio, USA)
Production related facilities	1,274	2007.12	2008.12	-Setting up production lines to respond to new supply agreements
Siam Yachiyo Co., Ltd. (Prachinburi, Thailand)
Production related facilities	1,340	2006.03	2008.12	-Increasing production capacity  -Streamlining and rationalizing operations -Revamping production equipment
Siam Goshi Mfg. Co., Ltd. (Rayong, Thailand)
Production related facilities	1,113	2007.12	2008.12	-Setting up production lines to respond to new supply agreements -Increasing production capacity -Streamlining and rationalizing operations
Yachiyo Zhongshan Manufacturing Co., Ltd. (Zhongshan, China)
Production related facilities	737	2007.12	2008.12	-Setting up production lines to respond to new supply agreements -Revamping facilities to make environmentally friendly and high-performance products