Message to Investors
Analysis of Business Results
FYE 2016 Business Results Report
1. Overview of Operating Results
In the fiscal year under review (from April 1, 2015, to March 31, 2016), although the U.S. economy and the European economy performed steadily overall, China's economy slowed. As a result, uncertainty about the overseas economic climate strengthened. In Japan, the economy performed solidly because higher capital investment accompanying government economic stimulus measures and a pickup in corporate results counteracted signs of weakness in certain sectors, which reflected the downturn in the overseas economic climate and yen appreciation.
In this environment, the Tsubaki Group worked to improve profitability while advancing initiatives pertaining to the strategic objectives of Medium-Term Management Plan 2016-namely, to implement product development and manufacturing strategies that consistently respond to the needs of the market and to undertake the expansion of businesses that leverage the collective strengths of the Group.
As a result, consolidated orders in the fiscal year were up 4.4% year on year, to ¥204,776 million, and net sales were up 3.7%, to ¥203,976 million.
Operating income increased 0.7% year on year, to ¥21,570 million, and ordinary income decreased 0.7%, to ¥22,109 million. Further, due to such factors the recognition of impairment losses at a consolidated subsidiary in China, net income attributable to parent company shareholders decreased 9.8%, to ¥12,766 million.
2. Outlook for the Current Fiscal Year
In the current fiscal year, ending March 31, 2017, overseas, the U.S. and European economies are expected to recover gradually. Meanwhile, growth in Asia's economy is expected to soften due to such factors as China's economic slowdown. In Japan, although the gradual recovery is expected to continue due to such factors as the benefits of the government's economic policies, strong uncertainty is likely to persist given the numerous causes for concern, including yen appreciation and low share prices.
Amid these business conditions, the Tsubaki Group will actively increase production capacity, expand and improve overseas bases, and enhance productivity with a view to realizing Long-Term Vision 2020. At the same time, the Group will make a concerted effort to accomplish the tasks set out in its Medium-Term Management Plan 2016, thereby strengthening the Group's ability to continue growing.
TSUBAKIMOTO CHAIN CO.
Chairman and CEO
President and COO