Overview of the latest financial information
Financial Results of the Fiscal Year Ending December 31, 2023
During the consolidated fiscal year under review, the global economy experienced a gradual slowdown due to persisting high prices of raw materials and energy due to the prolonged situation in Ukraine, a decline in domestic demand caused by rising inflation and accompanying monetary tightening mainly in developed countries in Europe and the U.S., a sluggish Chinese economy with real estate problems and other problems, and escalating tensions in the Middle East.
In Japan, although raw material prices continued to rise and the yen depreciated in the foreign exchange market, capital investment and personal consumption picked up, and the economy showed signs of a gradual recovery.
As a result, our consolidated sales decreased 1.1% to 59,014 million yen, compared with the prior year, also our operating loss amounted to 759 million yen (in the prior year, operating income of 978 million yen), ordinary loss amounted to 555 million yen (in the prior year, ordinary income of 2,120 million yen), and net loss attributable to owners of parent was 1,269 million yen (We had net income attributable to owners of parent 168 million yen prior year.).
The results for the segments are as follows.
Starting from the consolidated fiscal year under review, we will review the criteria for allocating corporate expenses effective in order to more appropriately reflect the performance of each reporting segment. As a result, the following YoY comparisons are based on the revised cost allocation method.
1. Electrical and Electronic Components Business
In the Electrical and Electronic Components Business, sales declined YoY due to sluggish sales of connectors and HDD-related components, the mainstay products. Although connectors for laptop PCs began to recover after bottoming out in the first quarter, the growth was sluggish due to the impact of the sluggish market, including a decrease in the number of PCs sold YoY. HDD-related components； saw a decline in demand for components related to high-capacity HDDs as IT companies curbed investment in data centers. Profits were sluggish due to the above-mentioned decrease in demand and a deterioration in the cost of sales ratio resulting from inventory reduction in the fourth quarter.
Under such circumstances, net sales in the segment decreased 9.6% to 33,083 million yen, compared with the prior year, also our operating loss amounted to 577 million yen (in the prior year, operating income of 2,545 million yen).
2. Automotive Components Business
Automotive Components Business grew as automakers' production activities recovered as the situation returned to normal after the COVID-19 pandemic and the shortage of in-vehicle semiconductors eased. In addition to growth in sensors for airbags, brakes, and other safety driving systems, sales of connectors for LED headlights remained strong, resulting in a YoY increase in sales. As for profits, the strong automobile market led to an increase in demand for automobile parts and higher plant utilization rates, which boosted the profit level.
Under such circumstances, net sales in the segment increased 19.9 % to 21,343 million yen, compared with the prior year, also our operating loss amounted to 708 million yen (in the prior year, operating loss of 2,314 million yen).
3. Equipment Business
In the Equipment Business, demand for resin encapsulation systems for in-vehicle semiconductors and power semiconductors, our specialty, remained high, but growth in the semiconductor market, which had been at a record high level until the first half of the previous fiscal year, slowed down in the second half, and the trend continued through this fiscal year, resulting in a YoY decrease in sales. Profit decreased YoY due to a slowdown in demand for equipment caused by market conditions.
Under such circumstances, net sales in the segment decreased 12.3% to 4,587 million yen, compared with the prior year, also our operating income decreased 29.3% to 527 million yen.