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| As a leading company in the mechanical seal industry in Japan, we will seek to develop overseas operations focusing on the global market, by establishing international alliance systems in the automotive and other industries. |
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| Results of fiscal 2009 |
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During the consolidated fiscal year ended March 31, 2009, the Japanese economy was initially affected by a surge in prices of crude oil and raw materials and rapid changes in the exchange rate, indicating an uncertain business environment. The economy was then dealt a severe blow in the second half of the fiscal year in the form of the global financial crisis, reflecting the collapse of certain Western financial institutions, stemming from the sub-prime loan crisis originating from the United States. In particular, during the fourth quarter of the fiscal year, the Japanese economy was faced with a severe global recession, given the freezing of capital investment and sharp inventory adjustments in major industries, including the automotive, construction machinery, and general industrial machinery.
In this environment, in the Group's mainstay Automotive Industry (AI) business with the industry continuing to suspend capital spending and scale back production, both orders and sales fell from October last year. In the General Industry (GI) business, orders and sales declined for products used in the construction machinery industry and in the semiconductor manufacturing facilities sector.
To respond to this turbulent business environment, we quickly cancelled the ongoing 3-year management plan, "Aiming for a global integral company-improvement of C.S. and E.S."* (from fiscal 2008 to 2010), and established the 2-Year Restructuring Plan beginning in fiscal 2009. Under this new plan, we cut costs in every aspect of operations to lower the breakeven point and implemented measures to overcome the current economic crisis.
As a result, we recorded lower sales and profits for the fiscal year under review on a consolidated basis, with net sales of ¥78,168 million (down 10.6% year-on-year), operating income of ¥3,246 million (down 57.2%), ordinary income of ¥3,622 million (down 56.7%), and net income of ¥1,337 million (down 66.5%).
In the meantime, considering the management environment, we have determined to pay year-end dividends of ¥3 per share, making annual dividend payments of ¥9 per share, including interim dividends of ¥6, which have been implemented.
*"Aiming for a global integral company-improvement of C.S. and E.S."
A 3-year plan that commenced in fiscal year 2008; Integral refers to the integration used in mathematics or that is necessary to make a whole complete. In other words, with the total integration of the abilities of individual employees, we will strive to develop a company and a corporate culture that are essential for the world. Incidentally, "C.S." means "customer satisfaction," and "E.S." stands for "employee satisfaction." |
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