Overview of the latest financial information

Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2022

During this second quarter consolidated term, the world economy saw a significant slowdown in recovery as a result of the COVID-19 resurgence and the Russia-Ukraine war. Intensified inflation pressure, limited procurement of materials and parts, and the risks of China's Zero-COVID kept the global situation uncertain.

Uncertainty about the future is growing in Japan, as the COVID-19 pandemic is not likely ending soon, the yen has been in a downward slide, and prices have risen suddenly.

Under this economic situation, our group's Electrical and Electronic Components Business and Automotive Components Business were sluggish, but Equipment Business continued to be strong.

Although our group's Electrical and Electronic Components Business remained unstable as a result of the lockdown and restricted production in Shanghai, China, it exceeded the initial plan thanks to increased sales attributable to the depreciation of the yen. Looking at each product, demand for finished products, including PCs and routers, was sluggish, as inflation and the Russia-Ukraine war rose concerns about economic slowdown. However, because more people work from home and demand structure for PCs has changed, Micro Coaxial connectors and Board-to-Board connectors for high-end PCs remained relatively strong. HDD-related components sold well to data centers, as communication has become faster and data volume has increased.

Automotive Components Business saw sluggish demand for its automobile parts, including sensors and connectors, because automobile manufacturers had to reduce their production volume and revamped the production plans. The reasons for this are that semiconductors and other parts were in short supply, and the supply chain was in a chaotic state as a result of the lockdown in Shanghai, China.

For Equipment Business, the sales of semiconductor resin sealing equipment, molds, and automatic tape applicators for preventing resin leakage continued to be strong, as semiconductor manufacturers had a strong will to invest in their plants and equipment. The fact that demand for spare parts for semiconductor manufacturing equipment was stuck at a high level also contributed to the sales growth.

As a result, sales of the second quarter of the current consolidated fiscal year decreased 10.0% to 29,505 million yen, compared with the prior year, also our operating income decreased 52.9% to 1,710 million yen, ordinary income decreased 26.4% to 3,022 million yen, and net income attributable to owners of parent was decreased 60.0% to 1,181 million yen.