Financial Overview

(in millions of JPY)

	FY2008	FY2007	Rate of Change (%)	Factors
Sales	122,452	144,888	(15.5)	-Decline in sales at its major customers in Japan and North America
Operating income	1,936	3,894	(50.3)	-Decline in sales
Ordinary income	806	3,465	(76.7)
Net income	(3,543)	1,302	-	-A re-assessment and review of deferred tax assets and other items was conducted.

Developments Outside Japan
-In Jul. 2008, the Company announced that it would acquire a majority stake in P.T. Oriental Manufacturing Indonesia (OMI). OMI, based in Indonesia, is an affiliated company of Malaysia-based Teck See Plastic Sdn. In March 2007, the Company established a joint venture with Teck See Plastic in Thailand. Upon completion of the capital increment, the trade name of OMI will be changed to P.T. Kasai Teck See Indonesia. The new company is expected to become a central manufacturing base in the ASEAN market for the Company, coupled with another facility in Thailand, to supply automotive interior parts such as door panels to Japanese carmakers located in Indonesia and will also serve as a hub for exporting component parts to be distributed in Japan and other Asian nations. (From a press release on Jul 15, 2008)


Business Restructuring
-In Dec. 2008, the Company announced that it will consolidate its two wholly owned subsidiaries making automotive interior parts in Gunma Prefecture. The integration, which will take place in April, 2009. The two companies are KPK Co., Ltd. (Meiwa-cho) and Mikuniseisakusyo Co., Ltd. (Ota City). KPK will absorb Mikuniseisakusyo and adopt a new name, Gunma Kasai Co., Ltd. Mikuniseisakusyo will be dissolved after the amalgamation procedure is completed. (From an article in the Nikkan Jidosha Shimbun on Dec. 16, 2008)

-In Oct. 2008, the Company announced its plan to reorganize manufacturing bases in South Kanto Area. Kasai Kogyo has decided to transfer the automotive interior parts operation at Ayase Plant of APM Co., Ltd., its subsidiary, to the Company's Samukawa Division. Thus, the group's automotive interior parts production capabilities in South Kanto, which have been carried out by the locations in Samukawa and Ayase, will be consolidated into the site in Samukawa. (From a press release on Oct 1, 2008)

Outlook for FY2009
Contracts
Automotive parts for the Honda Freed in Indonesia
-Start of Production: July 5, 2009
-Planned production volume: 2,000 units/month
-Parts being supplied: door trims (front/slide), tail gates, etc.

Automotive parts for the VW Passat
-Scheduled start of Production: January 2011
-Delivery to: VW's new Chattanooga Plant in the U.S.
-Planned production volume: 160,000 units/year
-Sales volume: approximately 15 billion yen over 5 years
-Parts being supplied: door trims (front/rear), roofs, front pillars, etc.
-Production facility: M-TEK Tennessee Plant

Sales Forecast by Region (on a Consolidated Basis)

(in millions of JPY)

	FY2008	FY2009 (forecast)
Japan	57,208	48,919
North America	43,392	30,456
Asia	6,599	5,637
Europe	15,251	6,488
Total	122,452	91,500

Sales Share by Major Customer

(%)

	FY2008	FY2009 (forecast)
Nissan group	60	61
Honda group	25	22
Toyota group	13	14
Others	2	3

R&D Expenditure

(in millions of JPY)

	FY2008	FY2007	FY2006
Overall	655	521	544

-R&D activities are implemented mainly by Development Division

R&D Activities
1. Reducing weight of products
The Company developed a new production process, called Kasai Synchro Press (KSP), that reduces weight and thereby contributes to reducing CO2 emissions and fuel consumption.  The Company presented this as a solution for producing door trims used on mass-produced vehicles and started to supply the products to its customers. The KSP enabled the Company to reduce the weight of door trims by about 40% compared to door trims with the equivalent shape produced by a conventional process. Also, the Company developed a technology by applying its injection molding process, Kasai Press Molding (KPM) , that does not need any coating in the foam molding for reducing product weight and also ensures good external appearance quality. The Company used the technology in manufacturing doors and luggage trims of commercial vehicles and started to supply the products to its customers. With the foam molding process, the Company succeeded in reducing weight of the products by about 15%.

2. Safety
-The Company successfully created injection molded parts that are capable of absorbing energy, thus contributing to safety inside vehicles. These parts, which are characterized by their unique design structure, are being used in mass-produced vehicles. The accuracy of the Company's technology to analyze lateral collisions has reached the stage to where it can be put to practical use. This technology, which uses CAE (computer simulation),  was supported by validations conducted on bench tests.

3. Global environmental protection
-The Company is replacing glue and cleaning agents that contain VOC (Volatile Organic Compounds). The Company instead will use standard and water-based adhesives, in addition to materials, that are free of VOCs. As to the use of vinyl chloride materials, the Company is switching over to olefin-based thermoplastic elastomer (TPO) and urethane based thermoplastic elastomer (TPU).

4. Comfortable interior space
-The Company introduced CAE in its development activities to create cabin-interior products that improve anti-noise/soundproofing performance. These products offer a high degree of flexibility in their shape and come in a large selection of materials. They also are high precision, high quality products.  The Company is also making sales presentations of products that offer a high level of customer convenience, which were developed and planned based on benchmarking activities.

5. Quality
-The Company developed an applied technology that better stabilizes the final appearance of exterior surfaces of plastic molded products, thus reducing the number of defective products created while being manufactured.

6. Creating added values
-The Company is in the process of developing designing, coloring, and decorating technology for decorative components such as door-waist embellishments.

Investment Expenditure

(in millions of JPY)

	FY2008	FY2007	FY2006
Overall	6,708	8,640	13,011

-Investments were made in die production facilities in response to vehicle model changes.

Investment by Business Unit

(in millions of JPY)

Locations
Japan
Kasai	3,342
Mikuni Seisakusho Co., Ltd.	537
KPK Co., Ltd.	315
Kasai-Tec Co., Ltd.	204
Outside Japan
M-TEK Inc.(USA)	1,142
Guangzhou Kasai Automotive Interior Trim Parts Co.,Ltd.(China)	692
R-TEK Ltd.(UK)	164
Kasai Mexicana S.A. de C. V.(Mexico)	108
Kasai Teck See Co.,Ltd.(Thailand)	68

New Facilities(As of Mar. 2009)

Company name Site name	Location	Type of facility	Planned investment (million JPY)	Start	Planned completion
Head Office	Kanagawa Pref., Japan	Quality measurement instruments, inspection tools	5,528	2009.04	2010.03
Samukawa Division	Kanagawa Pref., Japan	Facilities to assemble automotive interior parts, tools, and other items	134	2009.04	2010.03
Yorii Division	Saitama Pref., Japan	Facilities to assemble automotive interior parts, tools, and other items	15	2009.04	2010.03
Kyushu Division	Ohita Pref., Japan	Facilities to assemble automotive interior parts, tools, and other items	641	2009.04	2010.03
Mie Kasai Co., Ltd. Head Plant	Mie Pref., Japan	Facilities to assemble automotive interior parts, tools, and other items	43	2009.04	2010.03
Mie Kasai Co., Ltd. Shiga Plant	Shiga Pref., Japan	Facilities to assemble automotive interior parts, tools, and other items	12	2009.04	2010.03
Gunma Kasai Co.,Ltd. Tatebayashi Plant	Gunma Pref., Japan	Facilities to assemble automotive interior parts, tools, and other items	7	2009.04	2010.03
Gunma Kasai Co.,Ltd. Ota Plant	Gunma Pref., Japan	Facilities to assemble automotive interior parts, tools, and other items	2	2009.04	2010.03
Iwatekasai	Iwate Pref., Japan	Facilities to assemble automotive interior parts, tools, and other items	1	2009.04	2010.03
Kasai-Tec Co., Ltd.	Shizuoka Pref., Japan	Facilities to produce dies for automotive interior parts, tools, and other items	8	2009.04	2010.03
M-TEK Inc.	Tennessee, USA	Facilities to assemble automotive interior parts, tools, and other items	933	2009.04	2010.03
R-TEK Ltd.	Tyne and Wear, UK	Facilities to assemble automotive interior parts, tools, and other items	716	2009.04	2010.03
Kasai Mexicana S.A. de C. V.	Guanajuato, Mexico	Facilities to assemble automotive interior parts, tools, and other items	679	2009.04	2010.03
Guangzhou Kasai Automotive Interior Trim Parts Co., Ltd.	Guangzhou, China	Facilities to assemble automotive interior parts, tools, and other items	242	2009.4	2010.3
Kasai Teck See Co.,Ltd.	Ayuttaya, Thailand	Facilities to assemble automotive interior parts, tools, and other items	918	2009.4	2010.3