Toyoda Gosei Co., Ltd. Business Report FY2011

Business Highlights

Financial Overview

(in millions of JPY)
  FY ended Mar. 31, 2012 FY ended Mar. 31, 2011 Rate of
Sales 504,518 516,982 (2.4) 1)
Operating income 20,415 29,952 (31.8) -
Ordinary income 20,287 27,549 (26.4) 2)
Net income 8,971 17,116 (47.6) -
Automotive component business
Sales 460,292  469,059 (1.9) 3)
Operating income 18,115 24,222 (25.2) 4)

-The Automotive Parts Division had lower production volumes in the first half of the year because of the Great East Japan Earthquake. However, during the second half of the year, new-vehicle production recovered overwhelmingly, with greater numbers of vehicle units being produced. As a result of these factors, performance overall ended up to be around the same level as it was the previous year. On the other hand, though, the Optoelectronics Division's performance decreased year-on-year to 504.5 billion yen (a 2.4% year-on-year drop) because of the heated price-war among chip manufacturers overseas.

- Both the Automotive Parts Division and the Optoelectronics Division strived to reduce operating costs. However, there was too much turmoil in the markets and too much fluctuation in currencies. As a result, operating profits dropped year-on-year by 31.8%, to 20.4 billion yen; ordinary profit was 20.2 billion yen, a 26.4% year-on-year decrease; and current net profit was 8.9 billion yen, a year-on-year decrease of 47.6%.

-Due to the impact caused by the Great East Japan Earthquake and the flooding in Thailand, operating revenue slightly decreased for the year to 460.2 billion yen, a 1.9% year-on-year drop compared to the 469 billion recorded during the previous year. This was in spite of a recovery in production during the fourth quarter. If negative currency translation is not factored in, the performance this year would have been on par with that of the previous year.

-Profits by region were 18.1 billion yen, which is a 25.2% decrease year-on-year compared to the 24.2 billion yen recorded during the previous year. Impacting the results were the earthquake in the Japan and the flooding in Thailand, besides adjustments to product mix and product selling prices.

>>>Financial Forecast for the Next Fiscal Year (Sales, Operating Income etc.)


-The Company is set to restructure its Japanese domestic production, starting with expansion of the supply capacity in the Northeast region of Japan as early as in fiscal 2013. Toyoda Gosei, which currently conducts only assembly work of some components on the premises of the Iwate Plant of Kanto Auto Works, has an intention of establishing a local supply network, including at the site of the Miyagi Plant of Central Motor Co. It is now studying various ideas like expansion of the workshop within customers' facilities or setup of its own new off-site facility, hoping to finalize the concrete plan by this summer. (From an article in the Nikkan Jidosha Shimbun on January 12, 2012)

Financial Overview for FY ending Mar. 31, 2013

(in million of JPY)
  FY ending Mar. 31, 2013
FY ended Mar. 31, 2012 Year-on-year Fluctuation
Sales 560,000 504,518 55,482
Operating income 30,000 20,415 9,585
Ordinary income 31,500 20,287 11,213
Net income 19,000 8,971 10,029


R&D Expenditure

(in millions of JPY)
  FY ended Mar. 31, 2012 FY ended Mar. 31, 2011 FY ended Mar. 31, 2010
Automotive Parts Business 21,900 21,900 23,000
Non-Automotive Parts Business 3,900  3,600 3,000
Total 25,800  25,500 26,000


R&D Structure

-R&D activities are conducted globally through cooperation among several organizations within the Company: the R&D Center; Production Technology Development Center; Development, Engineering and Production Engineering Departments at each business segment; Technology Management Department; Material Engineering Department, and its subsidiaries outside Japan, namely Toyota Gosei North America Corporation and Toyota Gosei Europe.

R&D Facilities

Kitajima Technical Center Aichi Pref. Japan
Miwa Technical Center Aichi Pref. Japan

R&D Activities

-The Company developed and commercialized the following new products and technologies: airbags for light-weight driver seats, plane-emission LED room-light units, the recycling technology of opening trim, light-weight radiator hose, plastic fuel-lids, and others.
-Development of materials, products, and production methods that are capable of complying with all aspects of environmental regulations.
-Development of all-composite, high-pressure hydrogen tanks for fuel-cell vehicles.

Patent License Contracts for Innovations in Technology

(As of Mar. 31, 2012)
Company Country Contract Period
Eaton Corporation USA A patent license agreement for fuel valves. Feb. 10, 1999 - Feb. 18, 2013
Autoliv Development AB Sweden A patent license agreement for curtain airbags. Feb. 5, 2001 - Feb. 20, 2016
Stant Manufacturing, Inc. USA A patent license agreement for quick turn fuel caps. Apr. 2, 2001 - Oct. 18, 2014
Intier Automotive Interiors of America USA A patent and expertise license agreement for urethane spray surfaces Nov. 18, 2002 - May 10, 2014
Daimler AG Germany A patent for a cover used in millimeter-wave radar Nov. 10, 2011 - Sep. 23, 2019

Technical Assistance Contracts

(As of Mar. 31, 2012)
Company Country Contract Period
Stant Manufacturing, Inc. USA An expertise license agreement for conductive fuel caps Nov. 17, 1998 - Dec. 21, 2018
Magna Steyr Fuel Systems Germany A patent license agreement for conductive fuel caps. Feb. 26, 2004 - Dec. 21, 2018
Orbitronics Co., Ltd. Pakistan An expertise license agreement for steering wheels Dec. 29, 2006 - Dec. 28, 2014
Pong Codan Rubber (M) Co., Ltd. Malaysia A technological licensing agreement on weather-strips Jul. 16, 2007 - Jul. 15, 2012

Investment Activities

Capital Expenditure

(in millions of JPY)
  FY ended Mar. 31, 2012 FY ended Mar. 31, 2011 FY ended Mar. 31, 2010
Automotive Parts Business 33,100 36,100 29,300
Non-Automotive Parts Business 4,400 10,700 4,900
Group 37,600 46,900 34,300

-The company will invest 37.6 billion yen mainly in its Automotive Parts Business and Optical Electronics Business.

Automotive Parts Business
-The Company invested 33.1 billion yen in order to ready its production facilities to handle new products, and to increase production capacity mainly in emerging-market countries.

Capital Investment Plan (FY ending Mar. 31, 2013)

-The Company plans to make a capital expenditure of 39,000 million yen company wide so it can install new equipment and additional equipment. Of this amount, it will invest 36,900 million yen in its Automotive Parts Business on equipment (to produce automotive parts) and dies.

Investment Outside Japan

-The Company announced that it will strengthen the business structure of Toyoda Gosei Private Limited (TGIN), its subsidiary in India. While it used to be engaged in only final molding in its rubber sealing operation by importing half-finished products (extruded components) from Japan, TGIN is planning to introduce new production processes from material blending to extrusion in order to conduct a comprehensive production of rubber products by May 2012. It has also decided to accept capital participation from an Indian company, Minda Investment Ltd., thus changing the company name to "Toyoda Gosei Minda India Private Limited". The investment share is 82.1% by Toyoda Gosei, 12.9% by Minda and 5.0% by Toyota Tsusho Corporation. (From a press release on December 2, 2011)