TS Tech Co., Ltd. Business Report FY2010

Business Highlights

Financial Overview

(in millions of JPY)
  FY2010 FY2009 Rate of Change(%) Factors
Sales 357,489 317,990 12.4 1)
Operating income 20,163 9,598 110.0 -
Ordinary income 21,508 11,436 88.1 -
Net income 11,755 6,328 85.8 -

Factors
<Japan>
-Sales were up 8.5% year-on-year, to 119,624 million yen as a result of the Company revamping its product line up and increasing the sales volumes of the products it supplied in Japan, in spite of lower volume of orders from its main customers because of production stoppages caused by the Great East Japan Earthquake and because of lower demand that followed the end to new-car sales incentives.

<The Americas>
-Even though the Company was faced with negative currency translation, sales increased 5.7% year-on-year, to 139,648 million yen, because of a greater volume of orders from its main customers,.  

<China>
- Even though the Company was faced with negative currency translation, sales increased 15.2% year-on-year, to 77, 199 million yen, because of a greater volume of orders from its main customers.

<Asia/UK>
- Sales increased 49.2% year-on-year, to 48,259 million yen, because of a greater volume of orders from its main customers in Asia, especially in Thailand; and because its subsidiary in the U.K., which had been idle, returned to operating for the entire year.

Program Business

 <Japan>
-Started producing seats for the Honda Fit Hybrid.

<The Americas>
-Started producing seats designed for the North American version of the new Honda Odyssey.

<China>
-Starting producing seats and door trim for the Honda Accord Crosstour.
 

Restructuring

-The Company and Imasen Electric Industrial Co., Ltd. announced on October 29 that the two companies will strengthen ties in the area of automotive seat business by acquiring equity shares of each company. With this move, they intend to increase efficiency in developing and producing vehicle seat products. The Company, which already holds 10,000 Imasen Electric shares, will acquire additional 300,000 shares to raise the ratio of its shareholding in the company to 1.71 percent. Imasen, on its part, is intending to obtain approximately 230,000 shares of TS Tech(0.34 percent of all TS Tech shares), value of which is equal to the Imasen shares TS Tech will gain. The details of the transaction, including its method and schedule, will be decided later. (From an article in the Nikkan Jidosha Shimbun on October. 30, 2010)

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

Outlook for FY2011

(in millions of JPY)
  FY2011
Forecast
FY2010
Result
Rate of Change(%)
Sales 303,100 357,489 (15.2)
Operating income 8,300 20,163 58.8
Ordinary income 10,000 21,508 (53.5)
Net income 4,100 11,755 (65.1)

R&D

R&D Expenditure

(in millions of JPY)
  FY2010 FY2009 FY2008
Group 9,620
9,617 10,874
Automotive business 8,910
8,890 9,879

R&D Facilities

Technical Center Tochigi Pref., Japan
TS Tech North America, Inc. Ohio, U.S.A.

R&D Activities

1. Safety technology
-The Company developed active head rests that mitigate neck injuries caused by rear-end collisions; and more compact seat weight-sensors that control air bag deployment based on better sensing of occupants' weights.

2. Environmental technology
-The Company conducted research to improve the dismantling of passenger seats designed for four-wheel vehicles; and studied mono-materials such as cushion materials made of polyester fibers, creating new, lighter weight cushion materials.

3.Comfort technology
-Development of technology aimed at improving the sitting comfort of occupants from the time they seat themselves in a car; and lessening occupants' fatigue during long-time driving.

-Development of technology to improve static comfort based on ergonomics studies; research on ways to measure fatigue using the Company's proprietary theories.

-Aiming to develop the most comfortable seat in the world, the Company continued its R&D activities in the area of active functional devices.

4. Technology for Captivating Products
-The Company developed third-row passenger seats designed with underneath storage that can be opened/closed with one touch; and underneath seat storage that can be operated remotely.

-The Company will pursue integrating technology with electric components such as air conditioned seats, new weight-sensors, as well as multifunctional devices.

5. Car interior technology
-The Company worked to develop door trim lighting that offers a new feeling, balancing function (a single-unit light source) with a greater focus on design.

Investment Activities

Capital Investment                                                                                              (in million JPY)

  FY2010
Japan
4,216
The Americas
2,920
China
766
Asia/UK 1,384
Total 9,288

Japan
-The Company invested mainly in its facilities and equipment designed to produce new types of product items for the Honda Fit Hybrid; in facilities and equipment for dies; and in the acquisition of land for the Saitama Plant.

The Americas
-The Company invested mainly to install facilities and equipment to produce mew product items for the new model Honda Odyssey Fit Hybrid and new Civic, in addition to investing in facilities and equipment for dies.

China
-The Company invested mainly to install facilities and equipment to produce new product items for the new model Honda Accord Crosstour, in addition to investing in facilities and equipment for dies.

Asia/UK
- The Company invested mainly to install facilities and equipment to produce new product items for the new model Honda Brio, in addition to investing in facilities and equipment for dies.


Major Capital Investment Projects

(As of Mar. 31, 2011)

Plant Location Investment targets
Planned amount of investment (in millions of JPY) Start End
Saitama Plant
Gyoda city,
Saitama Pref.
Buildings, and facilities and equipment to produce seats and interior products for four-wheel vehicles. 1,703 Apr. 2011 Mar.2012
TS Tech (Thailand) Co., Ltd.. Ayutthaya, Thailand Buildings, and facilities and equipment to produce seats and interior products for four-wheel vehicles. 1,042 Jan.2011 Dec.2011
TS Tech UK Ltd. Wiltshire,
UK
Equipment to manufacture automotive seats 513 Jan.2011 Dec.2012