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＜Our main business＞
・We sell stamping, molding, valve, and TPMS products.
・In the tire valve market, our corporation’s founding enterprise, wehave been a specialized manufacturer with the world’s top market sharefor a long time.
Furthermore, we have acquired SCHRADER’s valve business in 2018.
We are the world’s top market share in this field.

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<Our history>
・In 1930 Started business in valve core nationalization
・In 1962 Listed in the Second Section of the Tokyo Stock Exchange.
・In 1970 Listed in the First Section of the Tokyo Stock Exchange.
Division Structure”Stamping and Molding”, ”Valves”, ”Other”
Stamping and Molding
Accounts for about 70% of total sales.
Primarily working with Toyota group, but also Mitsubishi, Honda, andSuzuki.
Based in Taiwan, the US, China, and Thailand.
Valves BusinessAccounts for about 30% of total sales
Based in Taiwan, the US, China, South Korea, Thailand, andof SCHRADER.

Belgium.

France and UK are added to our bases after acquisition

Newly Consolidated Subsidiaries
・Schrader, acquired in August, 2018, will be consolidated from thesecond quarter.

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＜Corporate Governance＞
We will conduct company management based on the stockholders’perspective and try to construct and maintain a clear corporate
governance system.
For the “Corporate governance code”, our basic policy is to follow all 73
items.
・For our corporate governance system, we are going to select “a female
candidate for an outside director” on the general meeting of shareholders
on June 15 th.
We will ensure transparency and fairness in the decision making processby adding more diversity for Board of Directors’ decision making.
・We also strengthened the function of “Outside Officers' Meeting” andchanged the system to discuss the selection of directors and theirrenumeration.
・We will expand, strengthen and improve essential internal
control/internal audit continuously in order to improve “corporate
governance” more.

5・As part of the ongoing revision of the compensation system for directors, we propose to the general meeting of shareholders to introduce a new“compensation for the granting of restricted stock system” instead of theexisting stock options.
・The purpose of this change is that, as executives, each officer has astronger sense of responsibility and promotes greater value sharing withshareholders, in addition to promote activities to improve medium tolong-term corporate value.

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＜Consolidated Financial Results ＞
・Automobile production volume remained strong in Japan, Europe &America, increased in China.

Sales
With sales expansion for new products and business in the U.S. for 7
months and business in France for 4 months consolidated as SCHRADER
valve business that was acquired in August, we launched a record highconsolidated sales for 2 consecutive years.
ProfitVariable cost increased associated with increase in sales; acquisition costand depreciation increased.
However, in addition to the increase in sales volume and consolidated
SCHRADER business, we had a record high profit for the first time in 2
terms.

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＜Causes of Fluctuation in Consolidated Sales & Income for 2018＞

Sales ・・・The main causes of increase and decrease are the following.
Positive Factors
Increase in sales volume to ¥ 28.4 billion
Mainly, sales increased due to sales expansion of new ultra-high tensile
components.
¥ 7 billion increase in sales due to acquisition of SCHRADER valve
business
Operating Profit・・・The main causes of increase and decrease are thefollowing.
Negative Factors
Increase in depreciation cost ▲¥2.5billion, Increase in costs ▲¥1.8
billion, Increase in labor costs ▲¥1.2 billion, Decrease in selling price▲¥0.9 billion, Material price etc. ▲¥0.4 billion
Positive Factors
Increase in sales volume ¥7 billion, cost improvement ¥2 billion

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＜Consolidated Financial Forecast＞
Sales
Forecasted ¥155 billion, an increase in income of 6.9% from the previous
term based on ¥105/$.
ProfitProfits are expected as follows;
Operating income ¥10 billion, 3.0% decrease from the previous term
Ordinary income ¥11 billion, 6.5% decrease from the previous term
Current net income ¥8 billion, 8.4% decrease from the previous term
ＲＯＥ・ＲＯＡ・ROA is expected to decline from 9.3% to 8.1%, ROA from 5.7% to 4.8%
due to decrease in profit and increase total assets due to aggressive capital
investment.

9＜Causes of Fluctuation in Consolidated Sales & Income（Forecast）＞

FY2019 Sales・・・The main causes of change are the following:
Negative Factors
Exchange conversion for overseas sales, decrease in selling price,exchange loss
Positive Factors
Selling volume increased, including ¥9 billion increase in sales due toconsolidating annual SCHRADER valve business results, and increase insales of new products
FY2019 Operation Income・・・The main causes of change are thefollowing:
Negative Factors
Increase in depreciation ¥1.7 billion (including ¥0.5 billion increase ingoodwill depreciation) ,Increase in labor cost ¥1.2 billion due to sales
volume, Decrease in selling price ¥1.1 billion, Exchange loss ¥0.6 billion, Increase in expenses ¥0.3 billion
Positive Factors
Increase in sales volume to ¥3.9 billion, cost improvement of ¥2 billion
・Exchange sensitivity

Annual ¥0.1 billion per ¥110

＜Returns for Stockholders＞
As for dividends, we aim for continuous and stable dividends that meet
our business results.
・We paid ¥28 for last year’s dividend.
As for the term-end dividend, considering business results etc., we plan
to annual dividend of ¥33 in addition to ¥19, increased by ¥5 from thelast year and the interim dividend of ¥14.
The payout ratio is 22.8%.

・We plan the interim dividend of ¥16, increased by ¥2.
As for the term-end dividend, it is undecided because uncertain situationin business environments is expected, such as U.S.-China trade friction,
influence of the rise of consumption tax etc.

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＜Consolidated Total Assets＞
Total assets at the end of March 2019
Was ¥203.8 billion; increased by ¥44.9 billion from the end of theprevious term.
Main Increase Factors
Current assets increased by ¥20.4 billion due to an increase in accounts
receivable and inventory assets influenced by business acquisition and anincrease in sales volume.
Tangible fixed asset increased by ¥ 15.8 billion due to an increase incapital investment mainly for strategic investment.
・”Purchase Price Allocation” of acquired Schrader business has been
completed in the year-end closing, and part of ¥14 billion of “goodwill”,
that was temporarily calculated at the interim closing, was transferred to“tangible/intangible fixed asset” and the balance of “goodwill” is ¥8.8
billion.

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＜Business Segment: Stamping & Molding Business ＞
Sales
・2018 Results
Sales increased by 20.7% due to an increase in new products inJapan, Asia, and U.S.
・2019 Forecast
Even though profit is expected to decrease in Asia, overall, expected toincrease by 3.3% due to an increase in profit by sales expansion for new
products etc. in Japan and U.S.
Operating Income
・2018 Results
Profit increased by 109.0% due to an increase in sales volume and cost
improvement in Japan, Asia, and U.S.
・2019 Forecast
In Japan and U.S., profit is expected to increase due to an increase insales volume.
In Asia, profit is expected to decrease due to a decrease in sales volume
and an increase in depreciation.
Overall, Profit is expected to decrease by 4.2%.

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＜Business Segment: Valve business＞
Sales
・2018 Results
Increased by 29.1% from the previous term due to an increase in sales
volume of TPMS products, in addition to an increase by acquisition of
SCHRADER valve business・2019 Forecast
Even though sales are expected to decrease due to the influence of
exchange conversion, 14.8% increase from the previous term,
contributed annually by SCHRADER valve business.
Operating Profit
・2018 Results
Even though increased expenses due to business acquisition, andincrease in depreciation of “goodwill” and tangible/intangible fixed assets
at purchase price allocation of the acquired company’s assets, 0.9%
increase from the previous term due to sales volume and cost
improvement.
・2019 Forecast
2.5% decrease from the previous term due to an increase indepreciation, including exchange loss and depreciation of “goodwill” eventhough increased sales volume will be effective.

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＜Regional Segment: Japan＞
Sales
・2018 Results
Sales increased by 12.5% from the previous term due to the expansionof sales of new products in addition to the steady growth of domestic
automobile production by major customers.
・2019 Forecast
The number of car production by major customers is expected to be flatwith the previous year, and sales is expected to increase by 1.2% fromthe previous year mainly due to sales expansion of new products.
Operating Income
・2018 Results
Even though there was an increase in labor cost and expenses, adecrease in selling price and an increased strategic capital investment,
profits increased by 1.7% due to an increase in sales volume and cost
improvement.
・2019 Forecast
5.0% decrease from the previous term due to a decrease in selling price,exchange loss, an increase in depreciation etc.

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＜Regional Segment: Europe and America ＞
Sales
・2018 Results
Sales increased by 52.5% from the previous term due to an increase in
new stamping & molding products in Ohio/Tennessee plants, as well as
the acquisition of SCHRADER valve business.
・2019 Forecast
Sales is expected to increase by 23.2% due to SCHRADER valve
business’s annual contribution, as well as an increase in sales of new
products.
Operating Income
・2018 Results
Profit increased by 39.5% due to SCHRADER valve business and an
improved production efficiency due to an increase in sales volume.
・2019 Forecast
24.2% increase from the previous term due to an increase in sales
volume and cost improvement, even though increase in depreciation andincrease in labor cost and expenses due to an increase in production
volume.

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＜Regional Segment：Asia ＞
Sales
・2018 Results
Sales increased by 16.2% from the previous term due to an increase in sales ofdies for launching of new cars in Taiwan and an increase in TPMS business for
S. Korea and China.
・2019 Forecast
Sales is expected to decrease by 3.9% due to a decrease in sales of dies in
Taiwan, as well as an influence of exchange conversion, even though stamping
business have started in Thailand and TPMS business in China contributed to anincrease in sales.
Operating Income
・2018 Results
Profit increased by 218.2% due to an increase in sales volume of Stamping and
TPMS business in Taiwan, China, and S.Korea.
・2019 Forecast
Even though profit in Stamping and TPMS business in China is expected toincrease, overall profit is expected to decrease by 17.7% from the previous
term due to an exchange loss, an increase in depreciation of a new stamping
subsidiary operation in Thailand, and a decrease in sales of dies in Taiwan.

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＜FY2019 Sales Forecast by Segment＞
Business Divisions
Stamping & Molding:¥103.8 billion; 70% of the total

Valve Business:¥50.8 billion; 30% of the total

By RegionJapan¥71.8 billion; 50% of the total

Europe and America ¥54.5 billion; 30% of the total
Asia¥28.7 billion; 20% of the total

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＜Capital Investment and Depreciation＞
Capital Investment
Invested ¥21.9 billion in 2018.
Planning to invest a high level of ¥23 billion in 2019 as well.
Depreciation
In 2018, it was ¥12.7 billion, increased by 28.1% due to a high level
capital investment in 2018.
In 2019, ¥15.4 billion is expected, increased by 21.8%, excluding
depreciation of “goodwill”.

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＜Capital Investment by Business＞
・Main capital investment from FY2017 to FY2019
Stamping BusinessWe are constructing ultra-high tensile stamping processing lines
domestically and globally;
we have deployed 9 cold press equipment units and 4 hot stamp
equipment units in Japan, Asia, and North America in order.
Valve BusinessWe are enhancing forging equipment in Japan,
expanding the aluminum die-casting business in South Korea, andstrengthening a new type of TPMS lines in China and North America.
We are also planning to invest for SCHRADER synergy, launching new
products and so forth.

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＜Consolidated Cash Flow＞
FY2018Operating activity gained ¥18.9 billion in cash. Capital investment
resulted in expense of ¥22.6 billion, acquisition of stock of subsidiaries
resulted in expense of ¥18.8 billion and minus of ¥21.6 billion in free
cash flow.
Financial activity gained ¥29.2 billion. Cash at the end of March 2019
resulted in ¥21.4 billion; increased by ¥8.3 billion from the previous
term-end.
Interest-bearing debt is ¥61.6 billion.
FY2019 Forecast
In forecast, operating activity will gain ¥24 billion in cash, capital
investment etc. will be ¥23 billion.
As a result, free cash flow will increase by ¥1 billion, financing activity
will cause an expense of ¥1 billion for dividend payment etc. and cash at
the end of the period will be ¥21.4 billion, and interest-bearing debt willbe ¥62.7 billion.

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＜Reference_Individual Financial Results and Forecast＞
Sales
・Results
Sales were ¥83.5billion, a 16.5% increase year on year due to gaining
new sales.
Profit・Results
Operating income was ¥6.1 billion, ordinary income was ¥7.8 billion, andnet income was ¥5.8 billion. Net sales, ordinary income, and net income
were the highest ever, due to an increase in sales volume and cost
improvement, even though there was a decrease in selling price, anincrease in labor cost and expenses due to business acquisition, and anincrease in depreciation due to aggressive capital investment.

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＜Progress of “OCEAN-20”＞
Last year, with the acquisition of the SCHRADER valve business, we
reviewed the medium-term management plan. We aim for a consolidated
sales target of ¥ 155 billion in OCEAN-20.2020.
・As the operating income margin, despite the burden of amortization of“goodwill” related to business acquisition, we will work to strengthen our
profit structure by making medium- and long-term efforts to achieve ourconventional 8% level.
・As for asset efficiency, we will aim for 7% level, with ROA on an
operating income basis as an indicator.
・We will strive for accomplishing our tasks in mid-term management
plan, earlier return of strategic capital investment, and creating synergyof Schrader business.

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＜The environment surrounding our company＞
In the automobile industry, we are in the midst of a major revolutionthat occurs only once every 100 years due to evolving globalization andvarious paradigm shifts, such as the expansion of emerging markets,
acceleration of overseas production transfers, transition to next
generation cars, and an entry from other industries, such as CASE, MaaS
etc.

Safety and environmental regulations, among others, further
improvement of safety performance, environmental performance, andcomfort performance are required. Interconnectivity between people andcars will progress with electricization, intelligence, and informationization.
Furthermore, demand for weight reduction, which is quickly becoming acore requirement for good car production, continues to accelerate.
We will work on “OCEAN-20” to meet our customers’ needs and theseindustry trends.

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＜Development of Light-weight Stamping Products＞
Our stamping products have deepened our technology to meet the need forweight reduction and collision safety improvement indispensable for nextgeneration automobiles.
In particular, we are sticking to the cold press method, establishing technology
to mold ultra high tensile materials, and adoption of 1180Mpa steel materials is
expanding.
We have developed the molding technology for 1180MPa material, that had
been difficult to elaborate complex forms with cold stamp method for a longtime, and we realized mass production of the front pillar lower for the first timein the world.
We will advance technological development in order to further expand theformable area of materials using the know-how of advanced forming and moldtechnology.
In addition, we are making technologies in hand for hot stamps that mold steel
materials by heating them at high temperatures.
For products difficult to mold with cold press method, we suggest hot stamps tomeet our customers’ needs.
Along with expanding adoption of ultra-high tensile material, we will deploy
large-class stamping machines locally and globally, and prepare for supplying
system sequentially.
As for Aluminum material, we have developed various welding technologies, inparticular, Friction Stir Welding (FSW) was highly recognized and we offer
improved material yield rate and its weight reduction.

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＜Offering Comfortable, High Environmental Performance Plastic
Molding Products＞
In our plastic molding business, we are offering sound/vibrationproofing products, such as all urethane engine covers and insulators forengines, focusing on urethane products that make use of the flexibility inshape, and focusing on technology development to improve NV
performance.
We believe that the need for quietness and comfort continues to behigh, including strengthening of outside vehicle noise regulations andsound insulation due to progress in EV conversion. We will promotematerial development and production technology development for
urethane foam, further enhance soundproofing and vibration isolation
performance, and achieve No.1 performance.
Regarding our work on decorating technology with resin film, we haverealized weight reduction and recyclability by film transfer technology
with a high degree of freedom of design as an environmentally friendly
technology to replace plating. We have received great praise from
customers. We will continue to develop decorative variations to meet
diverse needs in the future.

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＜Diversified Technologies in Forge Stamping and DC Business ＞
Forge Stamping BusinessWe offer thin, lightweight products that were impossible byconventional methods such as sintering and forging, by using plate
forming technology combining sheet metal forming productivity and highprecision cold forging.
Products are adopted in new-type automatic transmission parts, etc.,
and the range of application is expanding. Domestically, we will expand
the Yoro plant in Gifu Prefecture and promote production expansion andcustomer diversification with the base in Ohio in the U.S.
Aluminum Die Casting BusinessAt the South Korea subsidiary, we have established an integrated
production line that spans from die casting to cutting processing to meet
our customers’ needs.
We will expand the number of order items and offer products of highquality, such as electric compressors, components for electric power
steering, etc.

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＜Our Stamping & Molding Products Adopted on New Cars＞
Our technologies and products have been adopted to new RAV4:
reduced weight stamping products such as ultra-high tensile andaluminum components,
all-urethane engine cover, improved NV performance,
forge stamping products with sheet forging technology etc.
Our technology and products will continue to be adopted to new cars
globally.
This is the achievenent of “OCEAN-20” activities.

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＜Expansion of TPMS Products that Contribute to Safety and theEnvironment＞
We have been mass producing TPMS transmitters since 1999. Since
then, we have met our customers’ needs and developed more reliable
products.
One of our strengths as the only manufacturer of transmitters in Japanis our ability to offer high quality products in an integrated production
system that spans from design and R&D to full production.
We have recently developed the E-type transmitter, which is a small
and light-weight TPMS, and have begun mass production. To achieve
further functional improvement and design variations, we will continue toadvance weight reduction and size minimization for future model
generations.
In China, legislation mandating TPMS installation on vehicles has officiallypassed and has started being effective from January this year.
In South Korea too, we have started delivering our products to S.Korean
automobile manufacturer from 2018.
In production and sales, we have established a global system to comply
with the flow of legal regulations in various countries around the world.
We will increase production capacity, along with China legislation and thelaunch of production and sales of new types in Japan, the U.S., andChina.

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＜Worldwide Strategy for Valves＞
We have acquired SCHRADER valve business last year in order to secure
growth and cost competitiveness by refining our valve business, which is
our founding enterprise.
By integrating the PACIFIC brand, with superiority in Japan and Asianmarkets, and the strong SCHRADER brand in Europe and U.S. markets,
We have secured our leading position in the industry.

Now we have customers and markets in the world’s 4 regions: Japan,
U.S., Europe and Asia; we are ready for producing and selling our
products.
We are sure that we made a big step to achieve our goal “Aim to be a
top-class GLOCAL manufacturer of technology components” and this willlead to enhance our corporate value and strengthen business base with
Stamping & Molding business.

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＜Working for Synergy＞
In sales, we share customer information at each base, make the most ofeach sales channel, catch our customers’ needs as fast as we can, anduse our new product lineup to promote sales expansion.
In R&D, we use both companies’ resources for development and field ofexpertise, enhance product development by combining technologicalstrategies. We will promote to offer products that meet our customers’
needs quickly.
In production, we share production/quality management know-hows,incorporate each other’s good point, try to enhance manufacturing, andpromote strengthening cost competitiveness.
We, PACIFIC and SCHRADER, are going to create synergy earlier in sales,development, and production areas.

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＜Our Valve Products for Various Purposes＞
As an exclusive valve manufacturer, we have met customer needs invarious areas, developed and delivered various valve products.
The acquisition of SCHRADER valve business enabled us to offer various
products; valves for fuel system, valves for aircrafts, and industrial valves
were added to our product lineup, in addition to conventional valves.
In the future, we will continue to provide high-performance valvesutilizing sealing technology, pressure, flow rate and electric control
technology, and utilize the newly acquired bases and customer sales
network to capture a wide range of needs and further expand the valve
business.

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＜Medium-Term Management Plan”OCEAN-20”＞
In the medium-term, we have to appropriately deal with Protectionist
tariff policy, US-China trade friction, UK's withdrawal from EU, high crude
oil prices, BOJ's monetary policy, working style reform and labor
shortage, corporate governance, SDGs etc.
・For ”OCEAN-20”, our mid-term management plan, including matters
mentioned above, we will make dynamic business structure through
SCHRADER valve business.
・The keywords are “Technology and Overseas”, “Manufacturing is about
Developing People”, and “CSR and Environment Preservation”; wepromote “Five SHINKAs” and work further to be a “Top-class GLOCAL
manufacturer of technology components”.

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＜Aim for a 100-year Corporation＞
Our company will celebrate 100 years of business in 2030.
As a suitable company, we aim for a 100-year corporation through each
employee taking root in “PACIFIC VALUES”, the group’s universal values,
and develop a sustainable management strategy.
In addition to working on CSR and corporate governance, we will
advance to develop technologies for the next generation, work on
fundamental safety and quality, and improve our manufacturing
capabilities.
It is our employees who support further business growth and raise ourcorporate value. We respect diverse ways of thinking and the lives ofdiverse human resources. We will promote continuous development of
the next generation human resources to nurture high workplace skills
under our faith in “Manufacturing is about Developing People”.
We would like to make better relations with our stakeholders in pursuitof creating new value for the future and improving the quality ofcorporate management in order to continue to be a company trusted andexpected by society and to continue to exist as a company necessary forsociety.

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