Financial Overview

(in millions of JPY)

	FY2009	FY2008	Rate of change (%)	Factors
Sales	52,177	58,923	(11.4)	-Saleswere down because the Company's main customerreduced its auto production.
Operating income	4,105	2,207	86.0	-
Ordinary income	4,317	2,065	109.1	-
Net income	2,980	729	308.8	-

Recent Developments in Japan

-The Company has almost transformed its management position so that it should put the finest focus on profit earning. Its break-even point last month has been decreased almost to half the FY 2007 level, when the sales were approx. 65.3 billion yen. The Company has thoroughly eliminated waste through restructuring efforts started in FY 2007 and started full-scale efforts to spread globally its production system suitable for high-mix low volume manufacturing in the second half of 2008. The Company has thus established itself as a company capable of securing a certain level of profits in spite of output volume fluctuation, especially decrease. While its FY 2009 operating income margin target is 3.5%, the result is expected to exceed the target thanks to achievements of its constitutional improvement measures. (From an article in the Nikkan Jidosha Shimbun on Sep. 1, 2009)

Contracts

-The Company has received orders from Toyota Motor Corp.'s U.S. manufacturing base for its auto body seals. Its delivery is expected to start in 2011 for the flagship passenger car produced there. The Company launched activities to improve quality to the level of those made in Japan and such efforts have resulted in this new business. As for overseas operations, its joint venture in Tianjin, China is already supplying parts to Toyota. (From an article in the Nikkan Jidosha Shimbun on Oct. 1, 2009)

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

R&D Expenditure

(in millions of JPY)

	FY2009	FY2008	FY2007
Overall	1,046	1,451	1,705
Body parts	691	918	1,296
Brake parts	248	250	160

Major Developments

Body parts
-Development of materials and a new cross section structure with an aim to reduce a number of attachments. Development of weather strip seals with higher price competitiveness.
-Expansion of application of lighter sealing parts made of low specific gravity rubber for auto bodies.
-Expansion of application of combining interior components with more attractive design.
-Expansion of application of TPV G/RUN made of high-function elastomer with higher recycling efficiency.
-Establishing a manufacturing frameworkthat makes use of the unique features of each locality,ensuring that the company maintains its competitive edge.

Brake parts
-Developing higher performance rubber parts for brake systems; and new production methods that reduce costs.

Technological Licensing Agreements

(As of Mar. 31, 2010)

Partner	Country	Purpose	Contract period
Faltec Co., Ltd.	Japan	Window moldings and their manufacturing methods	From 2000.04.01 until the production terminates.

Technical Assistance Contracts

(As of Mar. 31, 2010)

Partner	Country	Purpose	Contract period
Metzeler	UK	Manufacturing technology for automotive weather-strips	From 1988.11.25, until production terminates.
Renault Samsung Mortors	Korea	Technical assistant agreement for sealing products for automobile bodies.	From 2003.03.01, until production terminates.

Investment Expenditure

(in millions of JPY)

	FY2009	FY2008	FY2007
Overall	Approx. 1,200	Approx. 2,200	Approx. 1,700
Body parts	Approx. 800	Approx. 1,100	Approx. 700
Antivibration parts	Approx. 100	Approx. 400	Approx. 400
Brake parts	Approx. 200	Approx. 300	Approx. 300

-Investment was focused on streamlining operations and revamping production lines in order to respond to model changes made by its customers.

Planned Capital Investments

(As of Mar. 31, 2010)

Company/Office Name	Location	Equipment to be installed	Planned amount of investment (in millions of JPY)	Start	Complete	Remark
Kinugawa Koriyama Co., Ltd.	Fukushima Pref., Japan	Auto body components productionfacilities	83.3	Apr. 2010	Mar. 2011	*
Kinugawa Oita Co., Ltd.	Oita Pref., Japan	Auto body components productionfacilities	52.6	Apr. 2010	Mar. 2011	*
Kinugawa Antivibration Co., Ltd.	Tochigi Pref., Japan	Anti vibration parts productionfacilities	87.0	Apr. 2010	Mar. 2011	*
Kinugawa Brake Parts Co., Ltd.	Tochigi Pref., Japan	Brake parts productionfacilities	151.0	Apr. 2010	Mar. 2011
Teito Rubber Ltd.	Saitama Pref., Japan	Brake parts productionfacilities	80.0	Apr. 2010	Mar. 2011	*
Kinugawa Rubber (Guangzhou) Co., Ltd.	Guangzhou, China	Auto body components productionfacilities	117.0	Jan. 2010	Dec. 2010	*

*No significant change will take place, as the investment is for rationalizingoperations and readying equipment to handle model changes.