TS TECH Co., Ltd. Business Report FY ended Mar. 2019

Financial Overview

(in millions of JPY)
  FY ended Mar. 31, 2019 FY ended Mar. 31, 2018 Rate of Change (%) Factors
Sales 412,072 479,490 (14.1) 1)
Operating income 38,793 47,346 (18.1) -
Ordinary income 41,407 49,681 (16.7)
Profit for the year attributable to owners of the parent 25,750 30,115 (14.5)

The Company started using IFRS 15: Revenue from Contracts with Customers starting from the fiscal year that ended in March 2019, which resulted in a decrease in sales of JPY 53,174 million.

1) Sales
-Even though the Company received higher  product orders in Japan because OEMs launched new models, overall sales decreased 3.0% year-over-year (y/y) due to lower products sales in China, Other Asia, and Europe; lower sales of dies in the Americas; and negative currency translation.

-Started producing the seats for the all-new Honda N-VAN, CR-V and INSIGHT.

ーSales and profits: The Company received higher product orders from OEMs who increased production volumes and raised its vehicle-content ratio, and as a result, business results increased 9.9% y/y. However, there was a decrease caused by the end of price adjustments from royalty expenses based on the Japan-USA advanced pricing agreement that was in effect the previous year.

-Operating income: Increased 23.6% y/y due to effective cost-reduction initiatives, even though sales fell because of the above-stated factor.

-Started production of the seats for the all-new Honda Insight and all-new Acura RDX.

-Sales and profits: Even though the Company received higher product orders in the Americas because OEMs launched new models, overall sales decreased 0.9% year-over-year (y/y) due to lower sales of dies and negative currency translation.

-Operating income: Fell 1.5% y/y due to higher costs for materials, even though there was increased revenue, an increase when price adjustments on royalty expenses ended based on the Japan-USA APA; and cost reductions as well.

-Started production of the seats for the all-new Honda ACCORD and all-new Acura RDX.

-Sales and profits: Decreased 12.4% y/y because of lower product orders from OEMS.

-Operating income: Decreased 32.4% y/y because subsidies obtained in the last fiscal year ended when the transfer of the Guangzhou Plant was completed. 

<Asia, Europe>
-Launched production of seats in India for the redesigned Honda Civic and Amaze, and production in Hungary of third-row seats for the redesigned VW SUV.

-Started construction of addition to TS TECH Bangladesh Limited, in order to increase production capacity.

Sales and profits: Decreased 12.1% y/y because customers ordered fewer products and because of changes made to the model lineup , even though sales of parts increased.

ーOperating income: Decreased 32.9% y/y due to lower income, even though the Company implemented successful cost-reduction initiatives. 

Production launch of new models in FY March 2019

Apr. - Jun. 2018 Jul. - Sep. 2018 Oct. - Dec. 2018 Jan. - Mar. 2019
N-BOX slope version CR-V N-BOX
Americas CIVIC SI(Brazil) CIVIC(North America) ACURA ILX(North America)
INSIGHT(North America) ACURA NSX(U.S.) CR-V(U.S.)
ACURA RDX(North America) ACCORD(U.S.)
ODYSSEY (version for mobility impaired)
Asia, Europa BR-V(Indonesia) CITY(Philippines, India) CR-V(Thailand) MOBILIO(Indonesia)
AMAZE(India) WR-V(India) CIVIC(Thailand) CIVIC(India)
JAZZ(India) BR-V(India)

ーHonda Insight (North America, Japan): Version launched in June 2018. Product order for front seat and door trim. Seat is larger compared to that in the previous model. Equipped with Company's mainframe. 16% lighter than previous seat. Equipped with latest electrical parts to enhance comfort.

Mid-term business plan

-The Company, in launching its 13th mid-term management planed called 2020 Vision: Innovative Quality Company, which covers the fiscal year ending in March 2018 up through the fiscal year ending in March 2020, aims to create the foundation for establishing an ESG-oriented management framework.
-There are three fundamental pillars, outlined below, to becoming the world’s top company through focusing on quality, product competitiveness, localized management, and human-resources development.

  1. Sustainable business growth
  2. Diversified management
  3. Coexistence with the social environment

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

R&D Expenditure

(in millions of JPY)
  FY ended Mar. 31, 2019 FY ended Mar. 31, 2018 FY ended Mar. 31, 2017
Group 12,700 11,900 12,300

-TS Tech Co., Ltd. announced on 6 December that it has succeeded in the forming of automotive door trims that are 17% lighter than conventional products by using a polypropylene material containing cellulose nanofiber (CNF). CNF reinforced resin, which has high rigidity, is expected to be utilized for the weight reduction of automotive parts. However, it is easily broken and difficult to be formed. TS Tech successfully formed door trims using a material composed of polypropylene and CNF in proportions of 9:1 on a mass basis. It achieved weight reduction by reducing the board thickness from 2 mm to 1.5 mm. TS Tech, as an advisor of the New Energy and Industrial Technology Development Organization (NEDO) for the evaluation of CNF reinforced resin for automotive parts, received CNF sample materials from the organization. While TS Tech faces challenges such as the improvement of impact resistance, the company will try forming other automotive parts and verify the technology for early practical use. (From an article in the Nikkan Jidosha Shimbun on December 7, 2018)

R&D Facilities

Name Location
Technical Center Tochigi Pref., Japan
Engineering Center Tochigi Pref., Japan
Safety Technical Center Tochigi Pref., Japan
TS Tech Americas, Inc. Ohio, U.S.A.
TS Tech Asian Co., Ltd. Bangkok, Thailand
TS Tech Deutschland GmbH Tappenbeck, Germany
Guangzhou TS Tech Automotive Interior Research & Development Co., Ltd. Guangzhou, China

Capital Investment

(in million JPY)
  FY ended Mar. 31, 2019 FY ended Mar. 31, 2018 FY ended Mar. 31, 2017 FY ended Mar. 31, 2016
Japan 3,667 3,515 2,804 2,233
Americas 2,033 2,671 3,733 7,026
China 737 1,322 3,495 6,153
Asia/Europe 974 1,131 1,165 1,650
Total 7,412 8,640 11,199 17,064

-The Company is planning to spend JPY 9,000 million in capital investments in the fiscal year ending in March 2020.