1

Financial Results Briefing for the 2nd Quarter inFY2017
the 94th period：Total term of the second quarter(Apr 1,2017-Sep 30,2017)

１．Company Profile

Nov 8, 2017

２．Financial Results for the 2nd quarter in FY2017
３．Financial Result Forecast for FY2017
４．New Medium-Term Management Plan（FY2018～FY2020）
Cautions for handling this document
Future forecast including this document was judged according to the information at the present time. The actual
financial result might be considerably different to the forecast mentioned here depending on Japanese or international
economic situation, business trend related to our company, and any risk or indefinite factors involved in fluctuation ofexchange rate.

１-１ Main Business at Our Company
Stamping Products

Molding Products■Hybrid Battery Case

■ Center Pillar■Trunk Hinge■Oil Pan■FR Side Member■Plate Forging■Cap Center Ornament■Wheel Cap■Accelerator Pedal■Engine CoverTire Valve Products

TPMS Products■Valve Cores■Tubeless Valve■Relief valve■Charge Valve■Transmitter Device2

１-２ Group Companies Profiles
Our Business is Developed
At Domestic 8 Plants, 13 Overseas Subsidiaries in 6 Countries（Domestic 2 Subsidiaries, 1 Equity Method Affiliated Company）
Valve Products Business
Stamping & Molding BusinessIndividualChubu

Nishi Ogaki Plant

Kita Ogaki Plant

Higashi Ogaki Plant

Mino Plant

3★New Company

JCR

A-(Stable)
Others

Yoro Plant
KyushuKyushu Plant
Kurihara Plant

TohokuWakayanagi Plant

Consolidated

TaiwanPacific Valve (Taiwan) Co., Ltd.

Thailand

Pacific Industries (Thailand) Co., Ltd

Domestic Consolidated
Subsidiaries

PI System Co., Ltd.

Pacific Manufacturing Ohio, Inc.
USAChina

Pacific Manufacturing Tennessee, Inc.

Tianjin Pacific Auto Parts Co., Ltd.
Changsha Pacific Hanya Auto Parts Co., Ltd.

Domestic

Taiheiyo Sangyo Co., Ltd.

★ Thailand

Pacific Auto Parts (Thailand) Co., LtdS
Korea

Pacific Valve Industrial Co., Ltd.
Pacific Air Controls Co., Ltd.

China Pacific Auto Parts Technology(Changshu)Co.,Ltd.

Belgium

Pacific Industries Europe NV/SA

Holding Companies etc.

Pacific Industries
USA Inc.
Pacific Industries
China Corporation
Japan（Equity Method Affiliated Company）

PEC Holdings Co., Ltd.

214

１-３ Corporate Governance

Enhance Our Corporate Valueby Raising Efficiency, Fairness, and Transparency of Management■Corporate Governance＜Organization Chart＞・Following ＣＧ Code all 73 items■Internal Control
・Strengthening all
subsidiaries’ internal control
・Auditors and Internal Audit
Divisions collaborate andsecure appropriateness・Exchange of opinions andsharing information withofficers outside the company■Risk Control
・Promoting company-widerisk reduction action
・Setup the separate
grievance desk
・Enhancing information
security

Stockholders’ Meeting
Assiginment・Dismissal
Assiginment
・Dismissal
Outside Director Committee

Assiginment
・Dismissal

AdviceBoard of Directors（7 Board Members, including 2 Outside Board Members）

2 Outside directors
2 Outside Auditors

Instruct・SuperviseReportAuditor's Meeting（4 Auditors
including 2 Outside Auditors)

Bring up ・Report

Audit
Management Meeting ※１

ReportAssistance

Audit&Supervisory
Board Member'sDept.

Accounting Auditor

Strategy Meeting ※２
ReportInstruct・Supervise

ＣＳＲ Meeting
Risk Management
Meeting

Instruct・ Each Committee etc
Supervise
Discuss and Report
Important items

Operating Officer(10 Operating Offifcers, including 3Concurrent Board Members)

Accounting
Audit
ＣＳＲ＆Audit Dept.

InternalAudit

Instruct・Supervise

ReportEach Business Unit, Head Office, Group Companies※1:Comprised of Outside Board Members, Fulltime Auditor and Operating Officer

Cooperation※2:Comprised of Inside Director

２-１ Consolidated
Financial
Result for 2Q
２-１ 第２Ｑ
連結業績
Sales, Ordinary Income, and Net Income for the quarter were Record-Breaking25

２-２ Causes of the Increase & Decrease in the Consolidated Income for the 2Q

Sales were increased, but Operating Income was a slight decrease≪2Q in FY2017 and 2Q in FY2016≫
Sales +68
Average exchange rate
・FY2016 107.4yen/$
・FY2017 111.2yen/$(Hundredmillion yen)

≪2Q in FY2017 and 2Q in FY2016≫
Operating Income △2(Hundredmillion yen)6

２-３ Consolidated Business Segment for the 2Q
Increase in income and decrease in profit in Stamping & Molding Business,Increase in income and profit in Valve Business

Sales(hundredmillion yen)

Valve

Stamping&Molding(hundredmillion yen)

Operating Income7２-４ Consolidated Regional Segment for 2Q
Increase in income and profit in Japan
Increase in income and decrease in profit in North America & Asia

Sales

(hundredmillion yen)
600
500

565
497

4030

Asia

40.5
5.1

121

102
400

Operating income(hundredmillion yen)

38.4
3.9

8.4

5.8

24.9

26.0

16/2Q

17/2Q

140111300

North America

20200

284
100

303

10Japan0016/2Q

17/2Q

8

２-５ Changes in Consolidated Total Assets for 2Q

9Strategic Capital Investment Made Tangible Fixed Assets Increased
Hundredmillion yen

Current Asset

1,408+90

1,499
Cash and time deposits+4

Accounts receivable+4

Fixed Assets etc.

△6+55

Property, Plant andEquipment,
Intangible Fixed Assets

Capital investment 105
Depreciation/Disposal △49

Investments andother Assets+32

End ofMarch,2017

Fixed Asset

End ofSept,2017

２-６ Return to Stockholders
As for interim dividend, 1 yen was increased
Annual dividend was same amount as the last term
Annual Dividends

FY2016 28yen (Middle of the year:13yen End of the year:15yen
FY2017(forecast) 28yen (Middle of the year:14yen End of the year:14yen

10３-１ Consolidated Financial Forecast for Whole FY
Full Year Forecast is Deferred. Sales and Operating Income was Record Highhundred million yen
1,100≪Sales & Sales Growth Rate≫

1,000

8.7%

900
800

hundred million yen≪Operating Income &Operating Income Ratio≫
20%

9.9%

999

6.9%

1,068

919

6.1%

1,036

1,100

△3.0%

10%
0%
-10%

700
600

-20%'13'14'15

16'17(forecast)

SalesSales Growth Rate

1009080706050403020
10010.0%

6.0%

7.0%

8.0%

7.4%

6978

8.4%

7.9%

8687

55

6.0%
4.0%
2.0%
0.0%

'13'14'1516

Operating Incom e'17(fore cast)11

３-２ Cause of Increased/Decreased Operating Income for whole FY
Sales were Increased by Increased New Products
Operating Income is Forecasted as Flat

FY2017 Forecast and FY2016
Sales +63
Average Exchange Rate
FY2016 109.2yen
FY2017 108.1yen(Hundredmillion yen)

FY2017 Forecast and FY2016
Operating Income ±0(Hundredmillion yen)12

３-３ Consolidated Segment Forecast for FY2017

Sales by Business
Others 20％(hundredmillion yen)(hundredmillion yen)

Asia

Valve30％

Sales by Region

1,100
hundredmillion yen

Stamping&Molding
70％

21％
1,100
North
hundredAmerica million yen
24％

Japan
55％

13

３-４ Business Segment：Stamping & Molding Business
Sales of New Products Contributed to Increased Income
Forecast of Increase in Profit by Improvement etc.
(Hundredmillion yen)

Sales

(Hundredmillion yen)forecast

Operating Income

forecast

14

３-５ Business Segment：Valve Business
Sales will be the Same as the Previous Term
Decrease Profit Forecast(Hundredmillion yen)

Sales

(Hundredmillion yen)

Operating Income

15

16

３-６ Regional Segment: Japan
Increase Sales and Profit forecast due to increased sales of new Stamping Products

Sales(Hundredmillion yen)

600

610
546

545

557

Operating Income(Hundredmillion yen)

577

70
9.4%

9.3%

60
50

400

40

10%

9.8%

8.6%

46.9

54.6
51.5

53.9

9.0%

55.08%
30

200
20
10

00'13'14'15'16'17(予)6%'13'14'15'16'17(予)３-７ Regional Segment: North America
Increase Sales Forecast due to Increased Sales of New Products
Increase Profit due to Improvement(Hundred million yen)

Sales

Operating Income(Hundred million yen)

300
7.5%

20.0273

250
241
200

260
237

17.8

19.0

4.6%
10.0

100

4.0%

11.0

8%
7%
6%

15.0

204

150

7.3%

5%

4.2%

4%

11.5

3%

8.1

2%

5.0

50

1%

00%

0.0
'13'14'15'16'17(予)'13'14'15'16'17(予)

17

18

３-８ Regional Segment: Asia
Increase Income Forecast due to Increased Stamping, TPMS Business in China(Hundred million yen)

Sales

(Hundred million yen)

Operating Income

250
15237
200

211

221

15%

230
12.9
10150

10%169

8.4

10.0
5.9%

6.1

5

100
2.9%

5%
4.3%

3.5%

050

0%
-1.2%

-2.0

0'13

'14'15'16-5'17(予)

-5%
'13

'14'15'16'17(予)３-９ Consolidated Capital Investment/Depreciation Forecast

19

Increase Investment/Depreciation Forecast due to Strategic Capital Investment(Hundredmillion yen)(Hundredmillion yen)

Capital Investment

Depreciation

185.1

180

166.3
153.9

150

180

37.5

31.0

150

45.2

62.7 120

30.9
120

119.8

111.6

45.8
90

49.8
3.660

N America

3090

18.7

Asia60

27.6

58.1

77.1

73.589.984.7
30Japan00'13'14'15'16'17(予)

99.5
69.9
17.2
8.5

80.0
66.3
20.1

23.7
10.0

84.1
22.2

22.3
12.8

9.6

8.3

44.1

37.8

'13'14

46.2

52.2

15

16

64.2

17(予）

３-１０ ＜Reference＞Individual Financial Result
Increased Sales. Operating Income/Ordinary Income were Record-Breaking[million yen ％]L a st 2 QSlaes（ Re su lt）
Ra t ioS a les2Q（ Re su lt）

2 0 1 6 （ La s t Qu a r te r）（ Re su lt）

S a les Ra ti o31,919 1 00％ 66,168 100％Ope ra t ing Inc ome
Or dina r y Incom e
N et In c o m e f o r Qu a r te r
( thi s te r m )N e t A ss e t s pe r S h ar e(t h is t e rm)

2,488

7.8%

5,362

2,574

500
40085

3.4%

Record HighI n c r e as e d pr o fit fo r t h efirs t t ime
in 2 nHighd term
Record

6,987

10.6%

3,485 10.2%

6 81

24.3%

2,373

7.4%

5,414

8.2%

2,543

7.4%

1 69

7.2% firs t t ime in 2 n d t e r m

43 .57-9 8.55-42.37--1.2

I n c r e as e d pr o fit fo r t h e-≪Operating Income & operating Income Ratio≫（hundred million yen）

100
661

631

620

80

opera tingi ncome ra tio

8.5%

8.2%

8.1%

7.6%

2nd ha lf

4.8%

s a les growth rate

300
200

I n c r e as e in pr o fit fo r 3t e r ms in a r o w

8.8%

800

600

In c r e ase i n in c o m e
7.4% fo r 3 t e r m s in a r o w

2 ,3 74

7.5%

2Q Tot a l%chang e2,803≪Sales & Sales Growth Rate≫

612

Ch an geRatio

34,293 100％

8.1%

（hundred million yen）

700

L a st y ea r ter m l ev el
S al es

2.1%

342

46
40

1.7%

1.4%

1st ha lf

60

51

5353

2nd ha lf

25
20

1001s t ha lf

00
’13

’14

’15

’16

’17/2Q

’13

’14

’15

’16

’17/2Q

20

21

４-１ ”ＯＣＥＡＮ-１８” Status of Achievement
Found the way to achieve Sales/Profit Goals in FY
PACIFIC GLOCAL VISION 2020
 From “Consolidated management”
to ”Integrated management”● Five“SHINKA”
真価・信加）を追求する企業Ordinary income ratio
11.0%
10.0%
9.0%
8.0%
7.0%

9.6%
8.7%

Target8.6%

8.4%

Consolidated Sales（hundred m illionyen）

1,200

999

1,068

1,036

1,100
21%

1,000

21%
800

OCEAN-18 Goal

600

24%

24%

Consolidated Sales ： ¥ 113 billion
Consolidated Ordinary Income Ratio ： 8％ range： 50％ or more

Total Assets Turnover： 1.05 or more
FX105yen/$

200

Overseas
50%

Domestic

400

Overseas Sales Ratio

1,130

55%

55%

50%

Asia
N.America
Japan0FY2014

FY2015FY2016FY2017FY2018 Goal

2222４-２ New Mid-Term Business Plan “ＯＣＥＡＮ-２０”
Goal for FY2020
Consolidated Sales

Consolidated
Operating Income Ratio

ROA (Operating Income)140 billion yen

8% Level

7% Levelsales・total assets Total Aseets（100 million yen）
1,500
140 billion yen

103.6 billion yen
1,000326

Operating Income
Total Assets （100 million yen）

Total Assets

150 billion yen (2Q)
35％up
fro m
FY2 016110 billion yenothers 1others 2

327

500

430

771

100
Operating Income Ratio
・8 ％ level

Operating Income ratio
・7.9 ％

87150

others 53 2 ％u p
from
FY201 6Valve・TPMS

Operating Imcome ratio
・8.4 ％86709
ROA
Stamping&Molding☆6.4 ％

140 billion yen

965
36％up
fromFY16ROA☆7 ％ level

50ROA☆5.9 ％00Slales

Op era tin g In co me

FY2016 Results

Sales

Op era tin g In co me

営業利益

FY2017 ForecastSales

営業利益

Op era tin g In co me

FY2020 Goal

４-３ External Environment Recognition
A Major Revolution Once in 100 Years【Tightening of Regulations】
・Safety Regulation
・Environment Regulation【Industry Trends】
・ Expansion of the Market of Emerging Countries
・Entry of Different Industries ・Diversity of Technology
・Revolution of Manufacturing

Enhance Safe Performance, Environment
Performance, and Comfort PerformanceElectrification

・PHV・EV・FCVIntelligence

Informatization

・AI・Connected
・Automatic ・IoTDriving
・Big Data

Weight saving

・Make full use of iron・NV Ability
・Multi Material

Our Policy
Technology Development & Base Preparation
Responding to Industrial Trends/Customer Needs

Harmony of
Human andVehicles

2322

24
22

４-４ New Mid-Term Business Plan “ＯＣＥＡＮ-２０”
Aim for Top Class GLOCAL Auto-Parts Manufacturer

４-５ Our Technology
adopted on New Camry
４-５ ＴＰＭＳの拡充

25
23

PACIFIC’s Various Technology was Adopted【Stamping】
Friction Stir Welding（FSW）
Aluminum Parts【Stamping】
Cold Press Technology
Super High Tensile Steel Plate【Molding】

All Urethane
Engine Cover
Won “Camry Project Award”【TPMS】【Stamping】

Exclusive forHybrid
Battery Case
【Forging Pressure】

8th speed AT Hub
For Gasoline Car

ＴＰＭＳ(Tire Pressure Monitoring System)

26
23

４-６ Technology
in Stamping Business
４-５Transition
ＴＰＭＳの拡充Technology Development particular about Weight Saving■Our Processing Technology
・Processing Technology of Cold Press for Super High Tensile Material, Hot Stamping,and Aluminum Material
Transition of Processing Technology for Super High Tensile Material

2000

2010

2020
Ho t Stamping

Cold Press

Further Development
1180Mpa

Super High Tensile

980Mpa780MpaHigh Tensile

590MpaTransition of Alminum Material Connection Technology20002010

2020
FSW（Friction Stir Welding）

TOX connection
トグロック結合
Spot Welding

Friction Stir Welding（FSW）

４-７ Expanding
Stamping Business
４-５ ＴＰＭＳの拡充

27
23

Established Super High Tensile Global Production System
・Established Production Base for Stamping Products in Thailand and Prepared
Quadrupole system in Japan, North America, China, and ASEAN
Japan
China

ASEAN

Capacity
Started in（ｔ）
Kyushu2500 Feb 2014
JapanOgaki
3000 Oct 2014
Tennessee
3000 May 2016
ColdUSAPressOhio
3000 Planned inApril 2018
China Tianjin
2500 Jan 2014
ThailandRayong3000 Planned inJuly 2019
Ogaki
500
May 2014
JapanHotOgaki
800
Nov 2016
Stamping
Planned in April 2018
USA Tennessee
800
Me t h o d・Established Production Basefor Stamping Products inThailand・Responded to localizationneeds in ASEAN

B ase

North America

Trade Name： Pacific Auto Parts (Thailand) Co., Ltd
Address： Siam Green City, Tambol Pluakdaeng, Amphur Pluakdaeng, Rayong

Capital： 125 million Thai baht
Investment Ratio ： Pacific Industrial 75％, Local Partners 25％
Established ： November, 2014
Production Start： Middle of 2019

４-８ Expanding
Molding Business
４-５ ＴＰＭＳの拡充

2823

Weight Saving & Function Improvement By New material & New method■No.1 NV Function by Deepening Sound Proofing &Vibration Proofing Technology

・Increased adoption of Engine Cover and Insulator
due to NV function improvement
・Made a contribution to noise reducing andcomfortability improving
・Realized cost reduction and weight saving

All Urethane Engine Cover■Film and Decoration Technology
・Development of alternative plating,deep drawing film
・Improvement of weight saving and aerodynamic
performance by developing decoration piece・Expansion of decoration variety to meet various needs■Processing Technology for New Material・Development of CFRP, new material and molding technology

Selectable Color Trim Wheel

４-５ ＴＰＭＳの拡充
４-９ Expansionof TPMS products

2923

Development of New Products and Increase Capacity in China Base

■Evolution of TPMS
・Evolved sensor technology and radio techniques
・Promoted weight saving, miniaturization, andprolonged life
■Constructed Global Production & Sales System inJapan, North America, and China

・Sales Bases in Europe and South Korea
・Started to deliver to Automobile Makers
in S. Korea in 2017
■Capacity Increased in China Production Bases・Producing 1 Line in Changshu, China
・Planned to increase 3 Lines inanticipation of legislation

Snap-in Type■Legislation trends in each region

RegionStart of Lagislation

N.America

Oct. 2015

EuropeNov. 2012

S.KoreaJan. 2013

TaiwanNov. 2014

RussiaJan. 2016

Middle East

2017 ModelChina

Jan. 2019Japanundecided

４-１０ Expansion of Forging Pressure Stamping, Die Casting Products

４-５ ＴＰＭＳの拡充

Received Manufacturing Part Grand Prix “Automobile Parts Award” in 2017

・Received in succession from 2016 the Toyota “Project Award”

・Our forging pressure technology wasadopted to hybrid mechanism for PHVvehicle
・Realized “increase strength” andSpline Plate for PHV“weight saving”

Tooth FormMolding

Increase Production Capacity for Aluminum Die cast Business in South Korea

・Constructed the Integrated production system forCompressor parts for car air conditioner
・Expanded items of engine auxiliary parts and motordriven compressor
Compressor Parts for Car
Air Conditioner

3023

４-５
４-１１ＴＰＭＳの拡充
Utilizing IoT
Utilization of Sensing and Radio Techniques■Make full use of our technology acquired over the years
and try IoT in equipment maintenance・Digitalization of information on equipment maintenance, repair
and failure
・ Put into use the technology that enables us to predict ordiagnose equipment failure■Started Developing Smart Die with Gifu University
・Construction of IoT Platform for Die which collects information onchanges of temperature and pressure within a die by sensing technology
・Analyzing the collected data and developing the method for finding root
cause of defects and control

3123

４-１２ Aim for 100-year Corporation
PACIFIC VALUESPACIFIC VALUESCorporate Philosophy

Spirit of Establishment
Company Motto

ＯＣＥＡＮ-20

VisionAction Guidelines

CSR Policy Technology Development

Our attitude

Guidelines for action,
Compliance policy Technology development
guideline

ValuePrinciple

Our Attitude

Dreams andChallengesTrustandRespect【Dreams and Challenges】
・Always have dreams (goal) and be adventurous with no fear
・Even you fail, take it as nourishment and keep pursuing the dream【Trust and Respect】
・Cherish ”Harmony” and put in the other person's shoe
・Cultivate corporate climate that everyone says thank you each other

ＧＬＯＣＡＬ ＶＩＳＩＯＮ

Short-Term Plan
（Company Policy/Annual Policy）
PolicyImproving Corporate Value3221