Nikki Co., Ltd. Business Report FY2009

Business Highlights

Financial Overview

(in millions of JPY)

	FY2009	FY2008	Rate of Change (%)	Factors
Overall
Sales	6,602	8,972	(26.4)	-
Operating income	(979)	(494)	-	-
Ordinary income	(1,072)	(437)	-	-
Current net income	(845)	(477)	-	-
Automotive device business
Sales	847	1,421	(40.4)	-Mainly due to a decline in sales of carburetors for automobiles
Operating income	(73)	102	-	-
Gas device business
Sales	2,208	3,373	(34.5)	-Mainly due to a decrease in exports to Korea
Operating income	(575)	(76)	-	-

R&D

R&D Expenditure

(in millions of JPY)

	FY2009	FY2008	FY2007
Overall	172	166	231

R&D Activities

Gas appliance business
-The Company conducted R&D activities for fuel system devices for CNG vehicles and diesel-alternative LPG vehicles as well as fuel supply system devices for industrial engines using natural gas and LPG.

-The Company is conducting R&D activities in response to air pollution prevention measures which are planned in the New Long-term Emission Regulations in Japan.

ECU
-The Company is conducting R&D activities in response to new generation microcomputers, modeling, new control concept and downsizing.

-The Company is working on R&D activities that respond to exhaust emissions regulations worldwide, as well as on OBD (On Board Diagnosis) II. In addition it is involved in developing fuel application technology that responds to customer requirements.

Investment Activities

Capital Investment

(in millions of JPY)

	FY2009	FY2008	FY2007
Overall	741	625	649
Automotive device business	24	81	81
Gas device business	548	196	125

-The Company focused investment on products and R&D areas expected to provide growth in the long term. It also made investments in labor savings, work rationalization and improved product liability.

Automotive device business
-The Company made capital investments in streamlining production.

Gas appliance business
-The Company invested in facilities and equipment corresponding to new models and more streamlined production.

New Facilities

(As of Mar. 2010)

Site Name	Location	Segment	Purpose	Planned investment (million JPY)	Start	Planned completion
Atsugi Plant	Atsugi city, Kanagawa Pref.	Gas device business	To streamline manufacturing facilities, etc.	237	2010.04	2011.03
Atsugi Plant	Atsugi city, Kanagawa Pref.	Automotive device business, Gas device business, General-purpose carburetors (General-purpose equipment business)	To streamline manufacturing facilities, etc.	43	2010.04	2011.03