AHRESTY REPORT2023
For the year ended March 31, 2023

CONTENTS
01
Introduction

4 ｜ Ahresty's Corporate Philosophy and Vision
6 ｜ Top Message
8 ｜ Message from COO
10 ｜ Ahresty’s History
12 ｜ FY2022 at a glance

02
Ahresty’s Value Creation

14 ｜ Ahresty’s Businesses and Strengths
18 ｜ Ahresty’s Value Creation Process03
Strategy and
Performance

20 ｜ Strategy Viewpoints and Materiality Identification
Process
22 ｜ Management Targets
24 ｜ Responding to Shift to EVs
25 ｜ Expansion of Business Domain to Vehicle Body
Components
26 ｜ Digital Innovation
27 ｜ Human Resources Development and Diversity

04
Initiatives to
Support Sustainable
Growth28 ｜ Sustainability Roadmap
30 ｜ Environment: An environment-friendly company
38 ｜ Social: Development of a corporate culture in which
everyone can work in good health and feel safe
42 ｜ Governance: Improving corporate governance
45 ｜ Introduction of new Independent Directors
46 ｜ Interview with an Independent Director

05
Data Section

48 ｜ Key financial, human resources and environmental data
for the 10-year period
50 ｜ Consolidated Financial Highlights
51 ｜ Corporate Information

Editorial Policy
The Ahresty Report is intended to help shareholders, investors,

2.0," which was prepared by the Ministry of Economy, Tradeand other stakeholders understand Ahresty's initiatives toand Industry.

achieve sustainable growth and enhance its corporate value
by providing them with an integrated presentation of Ahresty's
financial information, including management strategies, andnon-financial information, including environmental, social,and governance (ESG) information. This report was compiled
with reference to the "International Integrated Reporting
Framework," which is recommended by the IFRS Foundation,and the "Guidance for Integrated Corporate Disclosure andCompany-Investor Dialogue for Collaborative Value Creation■Period Covered
Fiscal year 2022 (April 1, 2022 - March 31, 2023)* Some of the information includes disclosure items and business activities thatbegan in and after April 2023.

■Scope of Coverage
Ahresty Corporation and the Ahresty Group■Cautionary Statement Regarding Future Outlook
This report contains Ahresty's plans for the future and forecasts
and projections regarding its performance. Please note that actual
results may differ from our projections.
AHRESTY REPORT 2023

3

01
Introduction

01

Introduction

Ahresty's Corporate Philosophy and Vision
VisionAhresty’s Value
Creation

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

We brighten
our planet’s
future with ourlightweighttechnology

2040 Vision and
Our Goal

Ensure yoursatisfaction
with Ahresty

RESEARCHSERVICETECHNOLOGY

MissionPurpose

We aim to create an affluent society by pursuing

Beyond yourexpectations

2040

Developpioneering
technology
through
continuous
research

Corporate Philosophy

Value

Let us take pride in our work, respect theory andexperimentation, value originality and invention andoffer superior products and service to our customers

and integrating each of these areas.
RST Way - Five criteria for action
Research means continuous research, investigation, and development of
new technologies, new markets, and new sales techniques. Service means
providing warm, attentive service through personal interaction. Technology

The RST Way’s five criteria for action—conscientious, proactive, speedy, learning, and challenge—
are the basis of each employee’s way of thinking and action to realize the Corporate Philosophy.

means truly excellent technology that incorporates both physical and soft
aspects and is highly beneficial for society.

Social Issues Ahresty addresses

Prioritytasks

Monitoringtasks

Ahresty’s priority tasks are to achieve Goals 13 (mitigating climate change) and 7 (energy) of the Sustainable Development Goals (SDGs),

Conscientious

We earnestly and sincerely make efforts for our customers and all stakeholders.
We strive to understand diverse opinions, thoughts and values, listening tothem with open minds.

Proactive

We are self-driven and enthusiastically strive for success.
Each of us takes the initiative so that our actions lead to significant improvements.

SpeedyWe act quickly, sensing changes in social needs and the global market.
We consistently strive to enhance and reform our work methods and our technologies.

Learning

We constantly evolve to reach our goals.
We advance ourselves by having inquiring minds to achieve expectations.

Challenge

We work unflinchingly on aggressive targets to achieve them.
We consistently challenge ourselves through theories and experiments
without fear of failure, respecting originality and invention.

the common goals of the international community decided at the UN Sustainable Development Summit, that it is hoped will contributesignificantly to solving social issues and that are also closely related to manufacturing aluminum die castings, Ahresty’s main business.

4

AHRESTY REPORT 2023

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01
Introduction

01

Introduction

Ahresty’s Value
Creation

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Top Message

For Stakeholders
Looking back on FY2022 performance
Since the second half of FY2022, the semiconductor shortage andother issues have gradually eased and automobile production
has recovered. As a result, our order volume increased fromthe second half of FY2022, and both sales and operating income
improved in the second half of the year, and we were able to returnto profitability in operating income for the full fiscal year. However,
we recorded a large amount of impairment loss, and were not able
to record a net profit. We apologize to our shareholders for this.

profitability through production efficiency improvement and cost
reduction, we continue promoting initiatives to establish a leaner
production system throughout the Group. We have completed
the integration of our die manufacturing sites in Japan (Tochigi,
Hamamatsu, and Kumamoto), and are also currently promoting
a plan to integrate the Higashimatsuyama Plant with Ahresty
Tochigi.

New Management Structure

In FY2023, the entire Group will work together to achieve a further

Thanks to the cooperation and support of many customers,

recovery in business performance in anticipation of an increasebusiness partners, and shareholders, as well as the efforts

in order volume due to the continued easing of the semiconductorof Ahresty's team members, Ahresty has grown along withshortage.

the increasing demand for die cast products from automobile
manufacturers and the expansion of overseas production.

Initiatives and Progress for 2224 Medium-Term
Management Plan*
Under these circumstances, we promoted the first-year plan
Representative Director,
Chairman and CEO

Arata Takahashi

Representative Director,
President and COO

of our 3-year Medium-Term Management Plan from FY2022

Shinichi Takahashi

demand for electric vehicles (EVs, HEVs, PHEVs, and FCVs),

to FY2024. In particular, we worked to capture new die casting
thereby shifting our die casting business portfolio. We set thetarget of 30% for the percentage of electric vehicles parts indie casting sales in FY2025, and the number of orders received
is expected to exceed the target. All die casting sites in Japan,
North America, China, and India are increasing production ofparts related to electrification and receiving new orders. In China,
where electrification is progressing and local manufacturers aremaking great strides, we are aggressively expanding transactions
with local manufacturers and global suppliers (Tier 1) in addition
to existing customers and cultivating new demand associatedD i re c t o rs

with electrification.
Furthermore, in the proprietary products business (MOVAFLOR),
sales to semiconductor-related facilities in China and other Asian

6

Representative Director,
Senior Managing Executive Officer,
Director in charge of Sales Command,
Chief of Quality Assurance Command

Director,
Managing Executive Officer,
Chief of General Administrative
Commandcountries remained strong. Regarding customer satisfaction

Naoyuki Kaneta

Hideki Nariya

customers in Japan, four in China, and one in Mexico. To enhanceevaluations (commendations from customers), we received
high evaluations for quality and other aspects from four major

However, since FY2019, we had been in an unfavorable profit
situation due to the impact of the COVID-19 pandemic as well
as sluggish sales to some of our major customers. Although theenvironment was very difficult, we have built a leaner production
system and integrated our domestic production sites over the past
three years. Also, the market environment is finally beginning toshow signs of recovery. The automotive industry is undergoing amajor transformation at a fast pace. This has created new demandfor die cast products. On the management side, we have begun
addressing new challenges, such as carbon neutrality, the SDGs,
DX and diversity. It is precisely in this period of great changethat Ahresty must make a generational shift to vigorously move
forward with tackling new challenges. In the past four years, wehave completed a generational shift in all of our site managers,
and now we have decided to make a generational change in ourmanagement team. The average age of the President and theChiefs of the four Commands (Quality Assurance, Manufacturing,
Sales, and General Administrative) has been greatly lowered.
With this new structure, we will continue to grow and evolve the
new Ahresty.
We sincerely ask all our stakeholders for their continued support.
* 2224 Medium-Term Management Plan: 3-year Medium-Term Management
Plan from FY2022 to FY2024

AHRESTY REPORT 2023

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01
Introduction

01

Introduction

Ahresty’s Value
Creation

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Message from COO

To respond flexibly andcontinue to grow in the
midst of constant change
President and COO

Shinichi Takahashi

Responding to Shift to EVs

Diversity

The automotive industry is now facing a once-in-a-century

Employees are the driving force behind the company's evolution andtransformation. The most important factor affecting our company is

growth. We aim to be a company where employees respect eachthe shift to electric vehicles (EVs). From a portfolio that has beenother's values and can always work actively and lively, regardlessdominated by engine and transmission parts, we are increasing theof nationality, age, or gender. We are improving work processes

proportion of motors, batteries, and electric components, which arewith a focus on ergonomics to create a workplace that is easy to

products for hybrid vehicles (HEVs) and other EVs. Aluminum die castwork in, regardless of age or gender. Furthermore, we established a

products, which have the four advantages of rigidity, dimensional

special subsidiary company, Ahresty Inclusive Service Corporation,accuracy, thermal conductivity, and light weight, have great potential

to expand employment of people with disabilities and promote theirfor adoption and market expansion and are in demand amid the shiftdevelopment. In the promotion of empowerment of women, weto EVs. In addition to this, we will continue to capture markets byobtained a 3-star "Eruboshi" certification from the Minister of Health,leveraging our global production system that can respond to the

Labour and Welfare. We will promote human capital strategy andrapid shift to EVs, stable quality, and attentive service. In FY2022,

management, implementation of career support, and designing of

we began supplying battery-related structural components tosystems to enable diverse work styles.

China's Contemporary Amperex Technology Co., Ltd. (CATL), which⇒P27. Human Resources Development and Diversity⇒P38. Social: Development of a corporate culture in which everyone
can work in good health and feel safe

has the world's largest EV battery installation volume and market
share. We are also collaborating with G-TEKT Corporation, a major
manufacturer of vehicle body frame components, to jointly develop
next-generation vehicle body frame components using aluminumand steel, taking advantage of the strengths of the two companies.
⇒P24. Responding to Shift to EVs

Security and Safety
Safety is the most important and highest priority. Unfortunately, we
have not been able to achieve zero accidents or injuries. However,

Digital Innovation

we believe that this can be achieved through the development of safe

It has been 10 years since the Third AI Boom began, and the use of

information security is important. We will strengthen both tangible

Carbon Neutrality

AI has become widespread in the manufacturing industry. Factoryand intangible measures to prevent accidents and injuries andautomation systems, which until now have been interlocked solely

create a secure and safe company.

would like to express my sincere gratitude to all our stakeholders

Our group is working to "improve the energy consumption efficiency

by electronic circuits, have the potential to evolve into something

who have supported us since our founding in 1938.

of vehicles by providing aluminum die cast products" and "reduce

more advanced with the addition of edge computing and network⇒P40. Social: Development of a corporate culture in which everyone canwork in good health and feel safe [Occupational Safety and Health]the use of fossil fuels by improving energy efficiency, etc." The use ofcontrol. At our company, we are working to realize unmanned

aluminum, which has approximately one-third the specific gravity of

production by combining factory automation systems, sensing, and

The Ahresty Group as a whole will continue to take on challenges

steel, reduces automobile weight and improves fuel and electricity

AI. Furthermore, we will collect data by utilizing sensing devices toand move forward to become a company that achieves "Beyond

efficiency. We will continue to develop technologies to manufacture

promote productivity improvement by analyzing big data accumulated

your expectations." We would like to ask all our stakeholders forcontinued support and encouragement.

I assumed the position of Representative Director, President andChief Operating Officer of Ahresty Corporation in March 2023. I

The automotive industry, which had been experiencing steady
growth in global demand and production, has changed dramaticallyover the past five years, with the COVID-19 pandemic, naturallighter and stronger products. Furthermore, 97% of the aluminumusing statistical methods and AI. Also, in the launch of new products,

it difficult to predict the future. In an age of VUCA and the era of athat we use in production is recycled. The amount of CO2 emissions

we will advance our technology toward the realization of a digital

major transformation of the automotive industry, I myself will takein the production of recycled aluminum is one-fourth that of steel,twin that allows the production of conforming products from the first

the initiative in taking on the challenge of continuing to grow andand we are working to minimize greenhouse gas and CO2 emissions

prototype stage through the use of simulation.

respond flexibly in the midst of constant change.

throughout the entire cycle by actively promoting the conversion⇒P26. Digital Innovation

disasters, the Russian invasion of Ukraine and other factors making

facilities and environments and the training of people. Additionally,of energy sources during production and reducing the amount ofenergy used.
⇒P28. Sustainability Roadmap /Environment: An environment-friendly company

8

AHRESTY REPORT 2023

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01
Introduction

01

Ahresty’s Value
Creation

Introduction

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Ahresty’s History
Shimura Aluminum Co., Ltd., Ahresty’s predecessor, was founded with a capital of 400,000 yen asa small factory in Itabashi, Tokyo, with three employees.
"Do not tell a lie for the convenience of business" and "Always propose what is best for the benefitof customers" are the words of the late Aiji Takahashi, our founder. This conscientious stanceresulted in gaining the trust of the public, serving as the driving force for the subsequent development of the company.
FY2022
Sales weight

145,543
1,409

tons

Sales weight

Net sales(tons)Net salesbillion yen(billion yen)

Employees

19 sites in six countries

COVID-19
pandemic

Great East Japan
Earthquake

Lehman’s Fall

Employees

March 2020

March 2011

September 2008

2002

2003

2004

2005

2006

2007

2008

2009

1938- Founded

2010

2011

2012

1988-

2013

2014

2015

2016

Renamed Ahresty Corporation.

2017

2018

2019

2020

2021

2022

2000- Aiming to contribute to weight reduction of vehicles.

1938

1961

1988

1997

2003

2014

Shimura Aluminum Co., Ltd.,
Ahresty’s predecessor, founded in Itabashi, Tokyo
Started manufacturing aluminum alloy ingots, die castproducts and aluminum sandFounder: Aiji Takahashi
mold castings.

Stock listed on the Second Section of the Tokyo
Stock Exchange.

Company name changed from Fuso Light Alloys
Co., Ltd. to Ahresty Corporation.

1989

Received the Minister of Economy, Trade andIndustry Award in the 20th Materials Process
Technology Commendation.

Listing of the shares changed from the Second Section to the First Section of the Tokyo Stock Exchange.

1962

Mass production of aluminum die-cast monocoqueframe for scoot-ers first time in the started for the
first time in the world.

2004

2018

Started RST Gakuen (academy) aimed at early
development of engineers.

Celebrated the80th anniversary.

1943
Fuso Light Alloys Co., Ltd. (now Ahresty Corporation) established.

Launched MOVAFLOR, first raised
floor system in Japan.

1964
ICEPET developed by Fuso Light Alloys won theChampion Award at the International Home Show.

1983

Awarded Deming Prize for the year 1989 (Smalland Mid-range Industries).

1996
Mass production of alternator brackets forautomobiles by the NI (New Injection) method(Ahresty’s proprietary casting method) started.

Corporate Philosophy codified[ Business expansion and global presence ]• Hamamatsu Plant started operation.
• Japan Precision Die Mold Mfg. Co., Ltd.
(now Ahresty Die Mold Hamamatsu Corporation) (manufacturing dies) established.
• Tokai Seiko Co., Ltd. (now Ahresty Pretech Corporation) (processing) established.
• Kyoto Die Casting Co., Ltd. Toyohashi Plant (now Tokai Plant) started operation.
• Tochigi Fuso Co., Ltd. (now Ahresty Tochigi Corporation) established.
• Ditec Co., Ltd. (now Ahresty Die Mold Tochigi Corporation)(manufacturing dies) established.
• Kumamoto Fuso Co., Ltd. (now Ahresty Kumamoto Corporation) established.
• Ditec Co., Ltd., Kumamoto Plant (now Ahresty Die Mold Kumamoto Corporation) started operation.
• Kumagaya Plant (production of aluminum alloy ingots) started operation.
• Higashimatsuyama Plant started operation• Pascal Trading Co., Ltd. (now Ahresty Techno Service Corporation)(manufacturing and sales of die-casting peripheral equipment) established.

10

5,499

persons(persons)(Fiscal year) 2001

• Ahresty Wilmington Corporation (US) established.

• Thai Ahresty Die Co., Ltd., an affiliated company for manufacturing
dies in Thailand, established.

2006
1999
Awarded in NADCA International Die-CastingAwards.

Te c h n i c a l C e n t e ro p e n e d i n To y o hashi, Aichi.

2022
Change in listing of the shares to Prime Marketof the Tokyo Stock Exchange• Thai Ahresty Engineering Co., Ltd. (design / Thailand) established.
• Guangzhou Ahresty Casting Co., Ltd. (China) established.
• Ahresty Corporation merged with Kyoto Die Casting Co., Ltd.
• Ahresty Precision Die Mold (Guangzhou) Co., Ltd.
(dies / China) established.
• Pascal Industry Co., Ltd. and Sugahara Precision Industry Co., Ltd.
merged and renamed Ahresty Yamagata Corporation.
• Ahresty Mexicana, S.A. de C.V. (Mexico) established.
• Ahresty India Private Limited (India) established.
• Hefei Ahresty Casting Co., Ltd. (China) established.
• Integrated Hamamatsu Plant and Toyohashi Plant,
and consolidated organizations as Tokai Plant.
• Ahresty Inclusive Service Corporation established.
• Merged Ahresty Die Mold Tochigi Corporation and Ahresty Die Mold Kumamoto Corporation
with Ahresty Die Mold Hamamatsu Corporation.
• Merged Ahresty Pretech Corporation.

AHRESTY REPORT 2023

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01
Introduction

01

Introduction

Ahresty’s Value
Creation

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

FY2022 at a glance

Net salesAsia

33,676 million yen

129,690

No.1

FoundedDie Casting Business

1938

million yen

19％

（26％）

Proprietary products
business(MOVAFLOR)

market share for raised
floor systems* for clean
rooms in Japan

Proprietary Products Business (MOVAFLOR)

2.3%

Die Casting Business

92.0%

Net sales

3,271
73.8％

million yen

Annual total floor area
Japan

Japan

Sales
composition
ratio by region

North AmericaJapan（28.5％）（45.5％）

36,995 million yen* Aluminum die-casting

Overseas

70,937 million yen
Approx.

Aluminum Business

Sales
composition
ratio by customer

B

Over

C

Net sales

Aluminum business

34,690,000)

5.7%

Number of die cast machines ownedED

35,010,000(Previous year: approx.

H

136,704 ㎡
67,780 ㎡

million yen

Number of automotive parts produced annuallyAF

140,938* Electric vehicles: EVs, HEVs, PHEVs and FCVs

Overseas

Market sharefor raised floor
systems* for clean
rooms in JapanNet sales

59,019 million yen

OTHER

G

70,001 million yen

Sales ratio ofparts for electricvehicles*D e l i ve re d to
4 7 p re fe ctu re s
th ro u g h o u tJapan!

200
4,000t machine,
units

Includingthe largest class in Japan

Number of global sites

19 sites in
6 countries

throughout the world

7,975

million yen

97％

100％

Number of employees

5,499
1,016

Percentageof recycledmaterials used inall DC products(Consolidated)(Non-consolidated)

Percentageof recycledmaterials used in
AD12 production

Human Resources Data
■ Consolidated

Japan

1,974（35.9％）

Employeeratio

4,544（82.6%）
Employee male/
female ratio

Overseas3,525（64.1％）
12

Male

Female955名（17.4%）■ Non-consolidated

Male

Number and male/
female ratio ofmanagers

260（89.7%）
Female30（10.3%）• Employee male/female ratio: 865 (85.1%):151 (14.9%)• Average age: 43 years and 6 months• P ercentage of female employees taking maternity leave before
and after childbirth and child care leave: 100%• Average monthly overtime hours: 10 hours 30 minutes• Re-employment rate of employees retiring at the age of 60: 83%

AHRESTY REPORT 2023

13

02
Ahresty’s Value
Creation

Introduction

02

Ahresty’s Value Creation

Ahresty’s Businesses and Strengths

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Ahresty Corporation(Head Office and Technical Center / Tokyo Head Office / Tokai Plant /Higashimatsuyama Plant / Kumagaya Plant)

Ahresty Tochigi Corporation
Ahresty Kumamoto Corporation
Ahresty Yamagata Corporation
Ahresty Die Mold Hamamatsu Corporation
Ahresty Techno Service Corporation
Ahresty Inclusive Service Corporation

Ahresty India Private Limited
Since its founding, Ahresty has mainly focused its business on manufacturing aluminum die cast products for use in automobiles. Aluminum die
casting is a manufacturing process that uses aluminum, a material that is lightweight and easily recyclable, offering wide design flexibility andhigh productivity. We brighten our planet's future by meeting the needs of vehicle weight reduction to improve fuel and electricity efficiency, CO2
emissions reduction, and creation of a recycling-oriented society with our lightweight technologies and global production capabilities.

Hefei Ahresty CastingCo., Ltd.

Die Casting Business

Ahresty Wilmington
Corporation

Ahresty Precision Die Mold (Guangzhou) Co., Ltd.

Global presence and one print for multiple locations

Guangzhou Ahresty Casting Co., Ltd.

In addition to 11 sites in Japan, Ahresty has operations at eight sites in five countries, namely, the United States, Mexico, China, India
and Thailand. Our die casting plants are able to produce and supply products of the same quality from a single drawing by sharing
their know-how on productivity and quality and having established a system of complementary production. We respond to customer

Thai Ahresty Die Co., Ltd.

needs with the "one print for multiple locations" approach. In recent years, orders received from leading foreign automotive parts

Thai Ahresty
Engineering Co., Ltd.

manufacturers that require global supply have been increasing.

Ahresty Mexicana,
S.A. de C.V.

Fully integrated production system and proprietary Optimal Process Condition Control (OPCC) technology
Ahresty has a fully integrated production system from aluminum alloy ingot production, design and manufacture of dies, casting, andmachine processing to manufacture and sale of peripheral equipment for die cast production. Sensing technology is used to measure,collect, and analyze various data. We conduct OPCC activities to pursue the optimal manufacturing conditions and to improve
productivity and quality at all our plants, aiming to provide superior quality products and attentive service.

[ Using statistical quality control to produce optimal manufacturing conditions ][ Factors ][ 2D codes ][ Store/analyze data ]Materials
Improved
productivity
and quality

Equipment(Casting machines, utilities)

Dealing with customers across the world

Evaluation by Customers

Ahresty does business with customers all over the world.

[ Major Awards ][ Major Customers ]• A ward of Appreciation for Excellence (quality category) from
Honda Motor Co., Ltd.
• C ertificate of Appreciation for Excellent Quality from Nissan
Motor Co., Ltd.
• Certificate of Appreciation from Yanmar Global Expert Co., Ltd.
• Regional Special Award from Jatco Ltd.
• B est Performance Award from Jatco Mexico, S.A. de C.V. forfive consecutive years• S pecial Prize from Jatco (Guangzhou) AutomaticTransmission Ltd. for two consecutive years• Q uality Improvement Award from Toyota Motor (Changshu)
Auto Parts Co., Ltd. and Toyota Motor Engineering &Manufacturing (China) Co., Ltd.
• E xcellent Supplier Award from Dongfeng Liuzhou Motor Co.,
Ltd. for two consecutive years• Q uality Cooperation
Award from Guangzhou
Automobile Group Co., Ltd.
• H onda Environmental &Sustainability Award from
Honda Development &Manufacturing of America,
LLC• Aisin Corporation• Yamaha Motor Co., Ltd.

• Isuzu Motors Limited• Yanmar Holdings Co., Ltd.

• Kubota Corporation• Univance Corporation• Jatco Ltd.

• Yamada Manufacturing Co.,

• Suzuki Motor Corporation

Ltd.

• Subaru Corporation• BorgWarner Inc.

• Daihatsu Motor Co., Ltd.

• M AGNA Powertrain de• Denso Corporation

Mexico S.A de C.V.

• Toyota Motor Corporation• S hanghai Volkswagen Co.,• Toyota Industries

Ltd.

We have technologies that contribute to reducing vehicle body weight and brightening our planet's future, including the joining

Corporation• G uangzhou Qishengtechnology to optimally combine aluminum die castings and dissimilar materials to meet weight and strength requirements; the laser• Nissan Motor Co., Ltd.

Powertrain Co., Ltd.

heat treatment technology to reduce CO2 emissions in the heat treatment process to 1/10; and the joining technology to enable the• Hino Motors, Ltd.

• C ontemporary Amperex

production of multi-material vehicle bodies.

• Honda Motor Co., Ltd.

Technology Co., Ltd.

［ Laser heat treatment technology ］• M itsubishi Motors

SampleManufacturing conditions

Linking measured production parametervalues to quality levels

Dies• Design of experiments• Statistical approach

Technologies to contribute to reducing vehicle body weight and brightening our planet's future

CO2 emissions
Reduction to

one
tenth

Corporation

Heat treating costs
Reduction toone
quarter

Properties and environmental advantages of aluminum
Aluminum’s specific gravity is 2.71, which is one-third of that of steel. Increasing the use of aluminum for auto parts may therefore contribute toT7 heat treatment Laser heat treatment

T7 heat treatment Laser heat treatment

Laser heat treatment of shock tower-type productreducing the weight of vehicles. Also, for 97% of Ahresty’s products, secondary aluminum alloy generated by recycling aluminum scrap is used. CO2
generated in production of the secondary alloy is about one-fourth that for steel. By taking advantage of the excellent environmental properties ofaluminum to reduce the weight of vehicles, we will contribute to climate change mitigation.

14

AHRESTY REPORT 2023

15

02
Ahresty’s Value
Creation

Introduction

02

Ahresty’s Value Creation

Initiatives to Support
Sustainable Growth

Data Section

Aluminum Business

Proprietary Products Business (MOVAFLOR)

Ahresty produces approximately 40 types of aluminum alloy ingots, including those for die casting (AD series) and casting (AC series)

In 1962, Ahresty developed and began marketing "MOVAFLOR," Japan's first aluminum die cast raised floor system. A raised floor

as well as those for special applications. We produce aluminum alloy ingots under strict quality control from raw materials, such assystem is a double-floor system in which wiring and piping are placed under the floor. Raised floor systems are widely used in generalvirgin aluminum ingots and additives, as well as aluminum cans and window frames and scrap from disassembled cars collected fromoffices, hospitals, and other facilities, and Ahresty is particularly focused on those for clean rooms in semiconductor production plants

all over Japan, and offer industrial ingots of excellent quality.

and computer rooms.

Development of alloys suited to customer needs withand needs of our customers based on the analysis data that

accumulated data and know-how

we have collected and accumulated, as well as our own

Ahresty conducts component analysis on its own. We

know-how.

develop and manufacture alloys suited to the characteristics

Environmentally friendly material, aluminum
Aluminum is a valuable resource, which can be recycled
and reused over and over again. At our Kumagaya plant, diecasting products that have been produced in the die casting
plant and finished their life on the market, come back to have

Delivered to a wide range of customers in all 47 prefectures of Japan from Hokkaido to
Okinawa Prefecture
MOVAFLOR is delivered to all 47 prefectures of Japan from Hokkaido to Okinawa Prefecture, and is
widely used in clean rooms, computer centers, plants, offices, etc.

[ Domestic delivery record ]500 m2 or more/case(April 2013 - March 2023)

Tohoku219,420m2
Chugoku

environmental targets for our production activities to reduce

28,740m2

the environmental impact of our manufacturing processes.
Kyushu⇒P30. Environment：
An environment-friendly
company

Chubu

48,640m2

11,037m2[ Overseas delivery record ]Hokkaido

928 m

Manufacture and sale of peripheral equipment for die cast production

2

Kanto
Shikoku

Ahresty Techno Service Corporation manufactures and sells peripheral equipment for die

2,430m2

cast production based on the needs of manufacturing sites, such as enhancement of quality
and productivity, improvement of working environment and energy saving, and consideration

80,407m2
Tokyo

38,907m2[ Main results in 2022 ]for the global environment. The company supports the evolution of Ahresty's die casting

No.1 share for raised floor systems fortechnology with an integrated system that covers equipment design, manufacturing, andAhresty

Expanding sales in China and othermanufacturing sites.

Asian markets

No.1 share of the domestic market for die cooling equipment

We have maintained the No.1 share of the

Peripheral equipment supporting the evolution of die casting technology

domestic market for aluminum die cast

Our flagship product, the Jet Cool System series, has the largest share of the domestic market

raised floor systems for clean rooms forfor die cooling equipment. It is also used by many overseas die-casting manufacturers. We

more than 10 years. We have received anoffer a variety of models to accommodate different die sizes, number of dies to be cooled, andorder for a large-scale clean room projectmultiple cooling patterns to meet the needs of our customers, including a model that circulatesalso in China, working to expand sales in
Jet Cool System (JECSS-M100)

the Asian market.

Yokkaichi Plant of Kioxia Corporation,a major semiconductor manufacturer,

clean rooms in Japan

installation based on technologies improved and developed through close relationships withcooling water for use in regions with unstable water environments.

84,138m2

Kinki

their life renewed as new material. We have set specific16

Strategy and
Performance

Kitakami Plant of Kioxia Iwate Corporation,
Other
companies

73.8%

etc. (approximately 180,000 panels in total)

No.1 market share for raised floor systems*
for clean rooms in Japan (FY2022 results)* Aluminum die cast

Kitakami Plant of Kioxia Iwate Corporation

AHRESTY REPORT 2023

17

02Introduction

02

Ahresty’s Value Creation

Ahresty’s Value
Creation

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Ahresty’s Value Creation Process
Business activities andbusiness models

INPUT

OUTPUTOUTCOME

Financial capital

Customerbase• Strong relationships of trustwith good customers• Capturing customer needs andmaking proposals

Human capital

Employees:
5,499 persons

y

es
Sal

[Major suppliers]

Partnerships

Natural capital[Water]746,530m3[Electricity]

Financial
base

ing

sing
cha

a
als

n

• "One print for multiple locations"production system• Establishing
optimal production
conditions through cause-andeffect management• Support
structure for highly
productive manufacturing
Business structure supporting Die Casting Businessprocesses
• Strong
partnerships with
Aluminum ingot
suppliersOver 370 companies

ur

ur

fa

ct

dp

nu

Over 330 companies
in 9 countries

[Gas]

Dies

14,769 thousand m3

Mate

ri

Products and services• Automotive parts• Raised floor systems• Aluminum alloy ingots• P eripheral equipment for die
cast production• Die casting dies

• Cash flow creation• Increase in ROE• I ncrease in stock price,
market capitalization andTSR• R etained earnings forinvestment in growth• M aintenance of stable
ratingtSocial capital[Major customers]

We aim to create an affluent society
by pursuing each of these areas andintegrating them.

Ma

Globalnetwork

Customers

Financial resultsmenTechnologies andknow-how
accumulated since
founding

12,103KLlog

RESEARCHSERVICETECHNOLOGY

Research anddevelopment
capabilities

Intellectual capital[Fuel oil]

no

lop

19 sitesin six countries
Die cast machines:
over 200 units

291,270Mwh

p

Te c hve

Production capital

d

o
pr

ls
osa

• R ealizing customer needs through joint
development• Technological proposals to help solve
issues of customers• R esearch and development of materials
and production methods•M aterial property assessments, observation
and analysis of various phenomena• S ystem that drives meticulous design
and analysis• Achieving optimal shapes through CAE

de

Human
resourcesanEquity attributable
to shareholders ofAhresty Corporation:
56.5 billion yen• U se of environment-friendly recycled
aluminum• P roduction within the Group(Kumagaya Plant)• P roduction know-how, accumulated
knowledge and data

We brighten
our planet’s
future with ourlightweighttechnology

Employees

Partners
Ensure yoursatisfaction with
Ahresty
Shareholders,investors

Society and environment• R eduction of materials andDevelop pioneering
energy consumption bytechnology
improving manufacturing
through continuous
Local
processes
research
communities• A dvancement of diversity andinclusion in human resources• I ncrease of complianceawareness• A voidance of use of conflict
Globalminerals, etc.
environment

Peripheral equipment

Sustainable growth

External environment

18

Enhancing
Ahresty's strengths

Solving social issues
through business⇒ P14. Ahresty’s Businesses
and Strengths⇒P 28. Initiatives to Support
Sustainable Growth●

Once-in-a-century transformation of the automotive industry• Shift to electric vehicles (EVs) • Achievement of carbon neutrality by 2050 • Advancement in CASE • Promotion of work style reforms
AHRESTY REPORT 2023

19

03
Introduction

03

Strategy and Performance

Ahresty’s Value
Creation

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Strategy Viewpoints and Materiality Identification Process
Formulation of 2040 Vision and 10-year Business Plan

Strategy Viewpoints and Materialit y Items
Identification Process for "10-year Business Plan"

Materiality Matrix for SDGs

the 100th anniversary of its founding. To achieve our aspirations, we formulated the "10-year Business Plan," which a long-term management plan

In formulating the "10-year Business Plan," we clearly stated ourthem along two axes: the impact on stakeholders and the impactthat also takes into account viewpoints of the social issues (SDGs) that should be addressed.

aspirations in the "2040 Vision" based on our corporate philosophy,

on Ahresty. Ahresty’s priority tasks are to achieve Goals 7 and 13

Ahresty's strengths, and solutions and contributions to long-termof the Sustainable Development Goals (SDGs) that it is hoped willsocial issues, and positioning the year 2030 as a milestone toward thecontribute significantly to solving social issues and that are also

realization of these aspirations, we identified the strategy viewpoints

closely related to manufacturing aluminum die castings, Ahresty’s

and materiality items for the "10-year Business Plan" while viewing

main business. We conduct activities to achieve the goals in the

future changes in the external environment as an opportunity for ourframework of the 10-year Business Plan.

Ahresty formulated the "2040 Vision" to become a company going "beyond your expectations" that aims to achieve further sustainable growth toward2040 Visio n a n d "Our Aspirations"

We brighten
our planet’s
future with ourlightweighttechnology

reforms. In the process of identifying them, mid-career and young
employees in Japan and overseas played a central role in discussion

Beyond yourexpectations

Ensure yoursatisfaction
with Ahresty

to determine aspirations in the "2040 Vision," while a working groupled by the executive officers played a central role in discussion todevelop measures for the "10-year Business Plan" to realize theseaspirations. The "10-year Business Plan" was formally decided at

Developpioneering
technology
through
continuous
research

the Executive Committee and the Board of Directors after companywide activities.

The process of developing the "aspirations" in the "2040
Vision"10-ye a r Bu sin ess Plan
2040 Vision

Beyond yourexpectations 2040

Strategy viewpoints

Carbon neutrality

We brighten ourplanet’s future with ourlightweight technology

Net sales 160 billion yen (180 billion yen after adjustment)*
Operating income margin 6%
Reduction of CO2 emissions in Scope 1 and 2 CO2 -50%

Main relevant
SDGs

2040 Vision
Aspirations

Earning the highest grade in important customer evaluations

Rate of female employees in Japan 20% or more

Starting carbon neutral die casting initiatives

Monitoring tasks
Issues to be promoted inon Ahresty and Ahresty’s stakeholders todaily work operations

Independent Directors

Process of developing measures in the "10-year
Business Plan"
Step1

Identification of risks and opportunities due tochanges in society in 2040
Prioritization

Step2

Step3

Backcasting

Ahresty's strengths, corporate philosophy, solutions
and contributions to long-term social issues, etc.

Consideration/validation of KPIs set as(qualitative and quantitative) targets for 2030

Step4

Discussion on/development of measures by theworking group

Step5

Approval by the Board of Directors

Shortening development lead time
Developing advanced and innovative technology

Priority tasks
Issues selected as having a big impact

AdviceRate of female managers in Japan 10% or more
Positive evaluation for key items in employee satisfaction survey 80% or moreHighbe addressed as priority goals

Diversification of executive managers

Reinforcing technology basefor weight reduction, carbon
neutrality, and enhancement ofcompetitivenessImpact on Ahresty

Mid-career and young
employees in Japan andoverseas who are expected
to be active around 2040

Net sales of the vehicle body components 4 billion yen

Improving diversity

Mo n i t or i ng t as ks

Discussions(compared to FY2013)
Sales ratio of electric vehicles components 55%

Improving employee engagement

Develop pioneering
technology throughcontinuous research

FY2030 targets

Shift in the business portfolio
Enhancing customer satisfaction

Ensure yoursatisfaction with
Ahresty

Management

10-year Business Plan

Enhancing earnings strengthand financial structure

P r i or i t y t as ks

High

Impact on Ahresty’s stakeholders

2040

In terms of social issues to be addressed, we have organized

Vision for 2030
Increase our share of parts for electric vehicles
Indicators for measured values (KPIs)
Improve the energy
consumption efficiency
of vehicles by providing
aluminum
die-cast
products

Providing parts for electric vehicles(EVs, HEVs, PHEVs and FCVs)
Contributing toelectrification andweight reduction

Providing parts for ZEVs
(EVs and FCVs)
Providing body and suspension-re-latedparts

Vision for 2030
Improve energy efficiency in production processes
Indicators for measured values (KPIs)
Reduce the use of fossil fuels by improving
energy efficiency, etc.

Reduction of energy consumption

Energy conversion

Introducing energy conservation
measures
Making improvements in productivity
Use of renewable energy and energythat generates less CO2* Figures adjusted to the exchange rates and aluminum prices of FY 2022 at the time of formulating the full-year FY 2024 business plan

20

AHRESTY REPORT 2023

21

03
Ahresty’s Value
Creation

Introduction

03

Strategy and Performance

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Management Targets
businesses with companies with an advantage in parts for electric

Strategy to Achieve the Management Targets

vehicles both inside and outside Japan. We see the acceleration

Four Pillar Financial Strategies (FY2023 to FY2030)

The Ahresty Group has launched its 10-year Business Plan, a long-of electrification as a big chance for the growth of the Group as it

term management plan toward fiscal 2030, and has been promoting

will lead to the expansion of demand for die-cast products and an

the 2224 Medium-Term Management Plan as the first action

increase in opportunities to acquire new customers. Meanwhile,plan of the 10-year Business Plan. Under the 10-year Businessthe automobile industry is in a very fluid situation with uncertainties

9%Plan, in response to changes in the external environment, such

such as the difference in speed of the shift to electric vehicles andCapital policy

as the acceleration of electrification of automobiles and moves

the emergence of new automobile manufacturers.

toward carbon neutrality, we set "shifting the business portfolio to

The Group adopts a business model whereby we receive orders

predominantly parts for electric vehicles," "establishing low-cost,for products for which net sales will be recorded three years later

highly productive MONOZUKURI," and "reducing CO2 emissions inand make advance investments for production equipment for suchproduction," as the pillars of our strategy. Based on these pillars,

products. Now, in the period of a grand transformation with many

we are making efforts to secure net sales, improve productivity, andvariable factors in the industry, we believe it is important to have aenhance earnings strength by shifting from parts for combustion

robust balance sheet that enables us to stably receive orders andengines to parts for electric vehicles.

make investments even if an unexpected change occurs.

The automobile industry, the customer of the Group’s major

We will promote the 10-year Business Plan to achieve a shift toproducts, is undergoing a grand transformation. In response to thepredominantly parts for electric vehicles, and thereby improve ourelectrification of automobiles, which has been progressing fasterprofitability as soon as possible. By promoting operations based onthan expected, the Ahresty Group has been working to increasethe "Four Pillar Financial Strategies", we aim to improve the priceorders for parts for electric vehicles, expand business to vehicle

book value ratio.

ROE (Long-term target)• R ecover net sales and sales weight by implementing an electrification strategy, and increase profits by reducing costs
and improving productivity• Pursue an optimal financial leverage that enables the achievement of both a sound balance sheet and the ROE target• M aintain an equity ratio that ensures resilience against fluid market trends, such as regional differences in speed ofelectrification and the emergence of new automobile manufacturers in the automobile market• P ursue an optimal financial leverage that enables the achievement of both a sound balance sheet and the ROE target

Equity ratio

body parts using aluminum for weight reduction, and start or expand40% or more

Capital investment

Approx. ¥140billion(including investment in dies)

Return to shareholders

Dividend payout ratioor more35%• C reate an operating cash flow as the source for implementing growth investment for a shift in business structure• I mplement investment for manpower saving in view of the decrease in labor force and the rise in labor costs in the
future• A t the same time, strengthen investment discipline, such as the criteria for selecting order/investment programs, andimprove investment efficiency by making effective use of idle equipment, etc.

• C reate stable profits to ensure a 35% or higher dividend payout ratio• F lexibly purchase treasury shares in view of the conditions of the business environment, capital accumulation,
investment, stock prices, etc.

With the four-pillar financial operation, aim to achieve a PBR of 1

Cash Allocation (FY2023 to FY2030)

2040 Vision and 10-year Business Plan

In view of the business environment of the Group and the characteristics of the Group’s businesses, our basic capital and shareholder return policy
is to properly return profits to shareholders while making growth investment for electrification and maintaining a sound financial structure. To thisBeyond your expectations 2040

Net sales:

180billion yen*end, we have provided shareholders returns based on consolidated business results.
The basic capital and shareholder return policy of providing appropriate returns while bolstering the financial structure and management base forbusiness development in the medium and long terms, we strive to improve the corporate value of the Company.

[ FY2030 target values ]Operating income:10.8billion yen*

Operating margin:

6%

Creating cash through business growth

Further business growth and proper allocation to shareholder returns

Creating cash

Cash allocation targets

Business strategies
Shifting the business portfolio to predominantly parts for electric vehicles• Establishing low-cost, highly productive MONOZUKURI • Reducing CO2 emissions in production

Financial strategies

ROE

Improve medium- to long-term capital efficiency
by achieving a return on equity (ROE) higher thanthe capital cost

Capitalinvestment

Business investment

Operating cash flow

160 billion yen

Capital investment for growth

140 billion yen

Increasing the sales ratio of electricvehicle components
Increasing profits by reducing costs andimproving productivity

Return to shareholders
Returns to shareholders based on consolidated
business results (dividends, share buybacks)

18 billion yen

Reduction in net interest-bearing debts

Continue growth investment to capture demand
for weight reduction and electrification, develop
new customers for parts for electric vehicles,
and promote man-power/labor saving

R o a d ma p
CapitalpolicyMaintain a sound financial structure to continue
flexible order-taking and growth investment

Return to

Aim to achieve within the 10-year Business Plan
Provide returns to shareholders based onshareholders consolidated business results

Human resources strategies
Creating workplaces where people are happy to work
• Promoting diversity • Human resources development according to the human resources roadmap

Operatingincome2.2

20billion yen

FY 2022

FY 2023

million yen

2 billion yen

Flexibly rebalance the allocation in view of the performance condition andinvestment needs

Capital investment¥

Dividend payout ratio

140 billion
35% or more
40% or more

Equity ratio

10.8

billion yen
Operatingmargin

6%

ROE

9%

FY 2030* Figures adjusted to the exchange rates and aluminum prices of FY 2022 at the time of formulating the full-year FY 2024 business plan

22

AHRESTY REPORT 2023

23

03
Introduction

03

Strategy and Performance

Responding to Shift to EVs

Ahresty’s Value
Creation

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Expansion of Business Domain to Vehicle Body Components

Expansion of sales ratio of parts for electric vehicles

Expansion of the range of products made by die casting

In 2022, global new vehicle sales were about 80 million units, of which 8 million were electric vehicles

A new concept was added to the die casting of vehicle body components when Tesla, a leading(EVs), accounting for 10%; however, by 2030, global new vehicle sales are projected to reach 100

EV manufacturer, integrated and produced the underbody using an ultra-large die casting machine.

million units, of which 35 million will be electric vehicles, accounting for 35% (forecast by LMC

Many die casting and stamping parts manufacturers in China have already begun mass-producing

Automotive). Regarding our market regions, hybrid vehicles will dominate the market in Japan, whilelarge car body components by introducing ultra-large die casting machines. With the expansion of thethe already forming electric vehicle market will be expanding in North America and China. In India,

range of products made by die casting, adoption of die casting for car body components is expected

it is expected that the automobile market itself will grow and the transition from gasoline to electric

to further increase in the future. However, in applying mega casting, it is necessary to fundamentally

vehicles will progress slowly. We are developing activities to win orders for parts for electric vehicles

review the vehicle body design, and we do not see that the current situation will change overnight
Representative Director,
Senior Managing Executive Officer
Responsible for the Sales Command,
Chief of the Quality Assurance Command

based on the sales strategies for each region and customer, with the goal of achieving a 55% sales
ratio of parts for electric vehicles by FY2030. In FY2022, the sales ratio of parts for electric vehicles
was 19%, and is expected to account for approximately 30% of total sales by FY2025.

[ Status of orders received for parts for electric vehicles]
Sales ratio of parts for electric vehicles（%）
60

2224 Medium-Term
Management Plan
FY2022 action results

50

Sales estimate
considering resultsof FY2022 (31%)

TargetNaoyuki Kaneta

02018

necessity and timing of its introduction.

Under such circumstances, for the time being, a multi-material body with a

220%

30

mixture of steel and aluminum stamping parts and die cast parts is definitely
a realistic solution. Die cast parts and stamping parts have different functions,Target values (FY2022)

and we believe that if they can be successfully combined, we can achieve both
functional improvement and weight reduction of the vehicle body at a highOrders finalized

10

will conduct thorough research to determine the needs of our customers, market trends, and theCommitment to multi-material vehicle bodies

245%

Orders finalized

ResultKenichiro Minedue to existing infrastructure, investment, reliability of component functions, and other issues. We[ Ahresty’s business for electric vehicles andmarket growth ]40

20

Executive Officer
Chief of the Sales Command

level. In July 2022, we agreed with G-TECT Corporation, a major manufacturer
2020

2022

2024

2026

2028

2030 (FY)• Enhancement of net sales of parts for electric vehicles is progressing as planned• Net sales of parts for electric vehicles are expected to increase at a higher rate
than market growthof vehicle body frame components, to jointly develop new value creation in
2022

2025

2022

2025

Global number of
Ahresty’s parts forelectric vehicles sales electric vehicles produced(unit: billion yen)(unit: million units)

Joint development with G-TEKT Corporation

vehicle body components and EV-related parts, and started a project. One of
our concepts is "no impact on existing processes" in which die cast parts are incorporated without making any changes to customers’ existinglines. By leveraging the strengths of both companies, including analysis/development technology for the entire vehicle body and manufacturing
technology for large, thin-wall and high-quality die casting, we aim to apply this concept to next-generation EV bodies by realizing the optimallayout of die casting and stamping parts at minimal cost, and we plan to make a concrete proposal to our customers within FY2023.

Strengths of Aluminum Die Casting and Global Production System
Aluminum die cast products, which have the advantages of rigidity, dimensional accuracy, thermal conductivity, and light weight, have great
potential for adoption and market expansion as parts for electric vehicles and vehicle body components and are in high demand. We canproduce them using and applying the material, equipment, and technical know-how that we have cultivated for engines and powertrains. Also,

Technology for joining of dissimilarmaterials

we have been working to develop proprietary technologies and actively promoting proposals to our customers. In terms of production system,
we have five production sites in Japan with the Technical Center as the center of technology development, and five overseas production sites
in four countries, the U.S., Mexico, China, and India. We also have sites for aluminum alloy ingots production, die casting dies production,

We are researching joining methods used in die casting for the

product design, and manufacture of peripheral equipment for die cast production. We have established a system of complementary production

integration of battery cases and automobile body components

by sharing know-how on safety, quality, and productivity among domestic and overseas die casting plants, thereby meeting the needs of global

for EVs. We are benchmarking and compiling a database of

automotive manufacturers, automotive parts manufacturers, and other customers with the "one print for multiple locations" approach.

die casting and steel sheet joining technologies required forthe production of multi-material vehicle bodies, and we are24

Beginning to supply products to CATL, which has the largest share of the
global automotive battery market

also conducting research and development of proprietary

In FY2022, we began supplying battery-related structural components to China's Contemporary
Amperex Technology Co., Ltd. (CATL), which has the world's largest EV battery installation
volume and market share.

enables partial heating of only the joining surface during thetechnologies, such as laser heat treatment technology that

Battery structuralcomponent

joining process.
Ahresty's booth to exhibit vehicle body components, joining technologies, etc. at the"2022 Japan Die Casting Congress & Exposition"

AHRESTY REPORT 2023

25

03
Ahresty’s Value
Creation

Introduction

03

Strategy and Performance

Digital Innovation

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Human Resources Development and Diversity

Evolution of Ahresty's MONOZUKURI

Human Resources Development

In this period of great change in the automotive industry, automobiles are evolving into highly functional

Ahresty believes that human resource development is the key to passing on the technology and know-

mobility to carry people and goods safely, securely, and smoothly. With the expansion of automatedhow that have been accumulated since its founding and to providing consistent production quality. We

driving and electrification, drivers' eyes and judgment are being supplemented sensing, communication,

have established the Global RST Learning system that enables all Ahresty Group employees to undergo

and AI; engines and fuel are shifting to motors and batteries; and Ahresty's MONOZUKURI is also

the same level of educational training globally so that they can systematically learn each program

shifting toward electric vehicles with an increase in parts for EVs. Furthermore, the need for weight

related to MONOZUKURI. In FY2022, 79 programs were offered with a total of 1,232 participants. The

reduction is increasing as vehicle weight increases due to enhanced safety equipment and increased

knowledge and skills acquired are useful in the MONOZUKURI field. In recent years, with the rapid

battery capacity for longer electric vehicle range. Amid the ever-changing external environment,

development of information and communication technology, the importance of data science, which
Executive Officer
Chief of the Manufacturing
Commandwe will continue to evolve Ahresty's MONOZUKURI to contribute to the electrification and weight
reduction of vehicles by taking advantage of the strengths of aluminum die casting.

Yasutaka Oshima
Adapting to vehicle weight reduction by utilizing digital technology

Director,
Managing Executive Officer
Chief of the General Administrative
Commandis an approach of processing and analyzing data to utilize useful information in production, has been
widely recognized. We are also promoting reinforcement of our digital infrastructure and fostering
leaders in data analysis by offering programs on basic statistics and multivariate analysis, holding IoTworkshops for engineers, and dispatching personnel to external data science instruction sessions in

Hideki Nariya

response to new educational needs at production sites.

In the area of technology development, we will improve simulation technology and analysis accuracy to contribute to more efficient automobile
development through model-based development (MBD). We will continue evolving our technology in the future with the aim of realizing a digitaltwin that enables the completion of prototype verification in a virtual space. In response to the needs for weight reduction of vehicle body

Enhancement of career support systemcomponents, such as replacement of parts made from steel with aluminum and resin alternatives, and use of multi-materials, we have been

In career planning, we are enhancing our career support system. We register each employee’s past career history, strengths and weaknesses,

developing technologies for joining dissimilar materials and heat treatment technologies that significantly reduce CO2 emissions and receiving

and future aspirations in the human resources database, and, based on this information, provide more opportunities for employees to think

an increasing number of inquiries regarding advanced development.

about their careers voluntarily through interviews with their supervisors. Through this system, we aim to draw out their latent abilities, promote[ Efforts to establish technologies for various joining methods to meet market needs][ Toward digital twin ]The key to using aluminum die cast parts for vehicle bodies is joining technology with dissimilarmaterials.
Rivet
SPR

Self-drilling
screw
FDS®

Element
welding
FlexWerd®

Solid-state welding

Adhesion

FSW

Adhesive

Butt welding

Lap welding

the placement of the right persons in the right departments, and encourage them to take on challenges while constantly broadening their work
perspectives.

[ Conceptual drawing of career planning ]❶ Organizing careers andself-understanding

technology

Past

Experience

Experience❷ Career goal setting

Experience

Experience

Experience

Present
Fluidity analysis

productivity and accumulating technical know-how throughIn our Medium-Term Management Plan that started in FY2022, we are focusing on diversity

Optimal Process Condition Control (OPCC) for process

promotion, especially promoting women’s participation in Japan. To promote an appropriate

control under optimum manufacturing conditions. We also

understanding of diversity and to raise awareness of the management level employees, training

use Business Intelligence (BI) tools to analyze and visualize

sessions were held in FY2022 for top management, domestic plant managers, and division

data, and forms to improve production efficiency and realize

Automatic inspection with image judgment
and AI

26

Future❸ Career planning

Diversity

In the mass production field, we are continuously improving

the operating status of each plant, equipment monitoring

Careergoal

managers, including ones introducing advanced initiatives at other companies and for exchanging
Robot simulation

opinions with our overseas plants that have a high ratio of female employees. In addition, on-site

predictive maintenance. In the meanwhile, the inevitablereforms are being implemented to create a workplace that is easy to work in, regardless of age orchallenge in expanding the application of aluminum die casting to vehicle body components is togender. So far, under the previous Medium-Term Management Plan that started in FY2019, we have

reduce manufacturing costs. In addition to achieving overwhelmingly high productivity by using

made improvements to approximately 500 work items, including tasks of lifting heavy objects andmulti-cavity die casting and reducing cycle time, we will promote the reinforcement of a leaner

tasks in unergonomic postures. We will develop this activity by surveying the number of positions

production system that does not rely on human labor, such as automatic product transfer between

that can be assigned to female employees at each plant, and identifying issues at each workplace

processes and automatic inspection of product appearance using image judgment and AI.

and taking measures against them in the future to create a more comfortable workplace.

Diversity training session

AHRESTY REPORT 2023

27

04
Ahresty’s Value
Creation

Introduction

04

Initiatives to Support Sustainable Growth

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Sustainability Roadmap
We believe that in order to fulfill our corporate social responsibilities and grow sustainably,components and 4.0 billion yen in sales of vehicle body components

Two priority tasks and Sustainability
Roadmap

it is important for Ahresty to address social issues through its business activities taking advantage of its strengths.

as the target for FY2030. Toward carbon neutrality, we are working
to "reduce the use of fossil fuels by improving energy efficiency, etc."

Ahresty’s priority tasks are to achieve Goals 13 (mitigating climatechange) and 7 (energy) of the Sustainable Development Goals

Sustainability Roadmap… Promoting diversity… Actions toward carbon neutrality… Contribution to mitigating climate change
through our products *2… Realize a good work-life balance(SDGs), the common goals of the international community decided
at the UN Sustainable Development Summit, that it is hoped willcontribute significantly to solving social issues and that are also
closely related to manufacturing aluminum die castings, Ahresty’s
main business. We are working to "improve the energy consumption
efficiency of vehicles by providing aluminum die-cast products"
for Goal 13. Aiming to contribute to electrification and reducing

for Goal 7, and aiming to reduce CO2 emissions in Scopes 1 and 2
by 50% (compared to FY2013). Monitoring tasks such as promotionof diversity, realization of a good work-life balance, improvementof employee satisfaction, etc. are issues that need to be addressed
and we conduct activities to achieve the goals in the frameworkof the 10-year business plan and medium-term manage-ment plan.
We will contribute to solving social issues through our businessactivities, aiming to enhance trust of our stakeholders and for thesustainable growth.

the weight of vehicles, we set 55% sales ratio of electric vehicles

Obtaining"Eruboshi"
Certification

Establishment ofDiversity andInclusion
Promotion Office

Reducing
CO2 emissionsin Scopes 1 and 2*1

Employeesatisfaction
positive
response
rate

29

▲

More than55%(vs. FY 2013)

30%

Sales ratioof electricvehiclescomponents%

204 thousand t / CO

28.7%
reduction

2

29% reduction

Sales ratio of electric vehicles components

19%
28

30%

286 thousand t/CO

Target value for FY 2024

50% reduction

Target value
for FY 2025

FY 2013 (Base value)

2

Target value for FY 2030%

Ratio offemaleemployees(in Japan)

55

Results for FY 2022
Reducing CO2 emissions in Scopes 1 and 2

Sales ratioof electricvehiclescomponents

Diversificationof General
Managers
and Executive
Officers"Eruboshi" Certification

Obtained highest rank (three-star)

Ratio offemalemanagers(in Japan)

20%
or over10%
or over

Employeesatisfaction
positive
response
rate

More than80%

Challenge tocarbon neutral
die casting

Reducing
CO2 emissionsin Scopes 1 and 2

Reducing
CO2 emissionsin Scopes 1 and 2

50▲(vs. FY 2013)%

Challenge
to carbon
neutrality

Target value
for FY 2030

55%

*1: A program to certify companies that meet certain criteria based on the Act on Promotion of Women’s Participation and Advancement in the Workplace and that are excellent in promoting empowerment of women.
*2: By increasing supplies of aluminum die-cast products, which are lighter than iron, the energy consumption efficiency of vehicles can be improved, contributing to the reduction of CO2 emissions.

AHRESTY REPORT 2023

29

04
Ahresty’s Value
Creation

Introduction

04

Initiatives to Support Sustainable Growth

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Environment: An environment-friendly company
E n viro n me ntal Policy

Disclosure Based on TCFD Recommendations

1. We are well aware that our activities of development, production, sales, and disposal are related to and influence the global
environment, and we establish the environmental purpose, goal, and implementation plan, revise them as necessary, and constantly
strive for improvement in our environmental conservation activities.
2. We observe environmental regulations, rules, and agreements of national and local governments, stakeholders etc., and establish ourown standards within a feasible technical and economical range, and strive for further environmental preservation.

The Ahresty Group has endorsed the TCFD* recommendations on March, 2023, and will work toenhance disclosure from the perspectives of "Governance," "Strategy," "Risk Management," and"Metrics and Targets."*TCFD: Task Force on Climate-related Financial Disclosures

3. We give special priority to the following aspects and make efforts to protect the environment and prevent pollution.
1) We thoroughly manage and constantly improve the facilities and processes related to air pollution and water contamination.

Meeting structure and its role in the sustainability promotion system
Board of Directors Meeting

Governance2) We maintain a 100% recycle rate in regard to waste materials.
3) We promote the reduction of the total amount of waste materials, the expansion of aluminum recycling business, and contribute torecycling-oriented society.
4) We work to prevent global warming by reducing CO2 emissions with the aim of achieving carbon neutrality.
5) We aim to develop and design environmentally friendly products and commodities.

a) Describe the board’s oversight of climate-related risks andopportunities.
b) Describe management’s role in assessing and managing
climate-related risks and opportunities.

4. We constantly stimulate awareness for environmental issues among our employees with respect to environmental protection bymeans of providing training as well as internally communicating the policy.
5. We enhance a harmonious relationship with society by striving toward environmental conservation of the local community.

Initiative examples
Installation of solar panels / Electric power conversion
In March 2021, we introduced a solar power generation system to
the Tokai Plant (Plant 1) and started its operation. We are gradually
introducing the system to other plants where it can be installed.
In addition, since December 2022, we have switched to electricity
derived from renewable energy sources at manufacturing sites of
Ahresty Techno Service Corporation. We will continue to promote

Development of CO2 emissions reduction technology
Ahrestyispromotingtechnologicaldevelopment that contributes to the futureof the global environment, including laser
heat treatment technology that reduces
the amount of CO2 emitted when rigid
plates and die castings are mechanically

The Ahresty Group identifies climate-related risks and opportunities,
analyzes their impacts, and compiles countermeasures at the
Sustainability Meeting. Important matters discussed at the

Executive Committee Meeting

Sustainability Meeting are escalated for deliberation and reported• Deliberates the medium-term management plan, 3-year management
policy (including the setting of key performance indicators andtargets) and the risk management plan
• Deliberates, makes decisions, or receives reports on importantmatters related to the Group’s sustainability, such as sustainabilityrelated risks and opportunities; activity guidelines and plans; andexternal communication and disclosure, including those regarding
TCFD recommendations

at the Executive Committee Meeting, which role is to deliberateor receive reports on important matters related to business
management
The Board of Directors Meeting, chaired by the Representative
Director and Chairman, receives regular reports on the content of
the Executive Committee Meetings and supervises sustainability
initiatives, including the status of responses to TCFD recommendations.

Sustainability Meeting

joined to one-tenth.
CO2 emissions

eco-friendly manufacturing,
including energy conversion.

Reduced to

1/10

Sustainability promotion system
Board of Directors Meeting
Approve / Supervise management plans,management policies, etc.

Submit / Report management plans,management policies, etc.

Executive Committee Meeting
Approval / Instruction

T7 heat treatment Laser heat treatment

Deliberate / Report important mattersrelated to business execution

Sustainability Meeting

Ahresty Mexicana wins Environmental Sustainability Award
Ahresty Mexicana won the Honda Environmental Sustainability[Efforts to reduce water consumption]Award from Honda Development and Manufacturing of

Ahresty Mexicana has improved the automatic device

America for its efforts to reduce water consumption in thethat maintains the appropriate amount of cooling waterproduction process.

Chair : Group Chief Sustainability Officer（Director in charge of General Administrative Command ）Secretariat : Management Planning Dept.
Member : Chief of Manufacturing Command,
General Manager of Safety and Environment Dept.,
General Manager of Management Planning Dept.,
General Manager of Human Resources Dept.
Deployment of approval / instruction
Collaborationin the cooling tower to a non-metallic device to prevent
corrosion and significantly reduce water consumption(a reduction of 15,286.76 m3 from FY2020).

• Approves the medium-term management plan and 3-year management
policy•Regularly receives reports from management and supervises
sustainability initiatives, including the status of response to TCFD
recommendations• Oversees management’s response to risks which have a significant
impact on the company’s management, including climate change
risk

Responsible Responsible Responsible Responsible
Dept. / Site
Dept. / Site
Dept. / Site
Dept. / Site

Risk Management
Secretariat(Management Planning Dept.)•Collects information on the social environment, laws andregulations, and trends in peer companies’ responses relating tosustainability• Identifies sustainability-related risks and opportunities, analyzes
their impacts, compiles countermeasures, and reports the results
at the Executive Committee Meeting•Communicates and disseminates the decisions to responsible
departments, as well as other relevant divisions, departments, andworking groups in order to be reflected in the business plan andactivities

Risk Management Secretariat• Incorporates the sustainability-related risks analyzed and identified
by the Sustainability Meeting Secretariat into the risk management
plan, and formulates an action plan for risk avoidance andreduction in cooperation with the department responsible for eachidentified risk.
• Formulates a risk management plan, manages its implementation
status, and reports to the Executive Committee Meeting and theBoard of Directors Meeting*Responsible department: department or office of Ahresty Corporation that supervises the entire
group regarding a specific operation (function) for which it is responsible

30

AHRESTY REPORT 202331

04
Introduction

04

Initiatives to Support Sustainable Growth

Risks and opportunities identified are reflected in the Group's strategy.

Strategyb) Describe the impact of climate-related risks and opportunities
on the organization’s businesses, strategy, and financial
planning.
c) Describe the resilience of the organization’s strategy, taking
into consideration different climate-related scenarios,
including a 2°C or lower scenario.

a) Describe the climate-related risks and opportunities theorganization has identified over the short, medium, and longterm.
The Ahresty Group has created an environmental roadmap and asustainability roadmap and is working to improve them because

To identify risks and opportunities due to climate change, and in

the risks related to environmental issues can affect its businessfiscal 2030, using the 1.5 to 2°C and 4°C climate warming scenarios

fiscal 2030 which is the target year of the 10-year business plan, we

published by IEA or IPCC.

examined physical risks such as extreme weather brought about by
government policies and regulations, and changes in market needs.

Technology Increased costs of carbon offsets (CCUS, carbon credits, CO2 capture,development conversion and storage technologies).

Impact on business andfinancial results
2°C or4°C
lower
scenario
scenario
Large

Small

Large

Small

• P romote measures to reduce CO2 emissions (introduction of solar power generation, energy conversion,energy conservation activities, purchase of renewable energy) in the challenge to achieving carbon
neutrality in 2050
• R &D of carbon neutral die casting (CNDC)• C ollect information on trends in environmental regulations and CO2 emissions reduction policies, andswiftly reflect the results in business strategies based on impact analysis

Risks

Transition risks

Large

Large

Increase in procurement costs due to soaring aluminum prices

Large

Small

•M
 itigate the impact by devising procurement strategies and negotiating with customers to shorten thetime lag in reflecting aluminum market prices to selling prices• Increase orders for parts for electric vehicles (strengthen sales to OEMs, Tier 1 companies, and non
Japanese companies that are leading the way in electrification, and formulate and promote order
strategies for each region in view of different trends in environmental regulations and the shift toelectrification)• Increase orders for vehicle body parts (promote the development of joining technology for dissimilarmaterials and seek cooperation with companies that have a competitive edge in the production of vehicle
body parts)• S trengthen profitability in non-automobile fields (MOVAFLOOR products)

Decrease in sales of existing products due to the electrification ofvehicles

Large

Small

Decrease in the acquisition of new customers or suspension ofbusiness, etc. (decrease in orders received) due to lack of response to
climate change and environmental issues, or lack of disclosure of suchactivities

Large

MediumDelays in responding to environmental issues damaging the reputationof stakeholders, discouraging customers from purchasing, making it
difficult to raise funds from investors, and affecting investors’ ESG
investment decisions.

Medium

Small

Acute

Damage to production sites and suspension of their operations due tonatural disasters, and delays in procurement due to logistics paralysis

MediumMedium• S trengthen BCP• S ecure emergency power supply (secure emergency power sources and utilize in-house power generationequipment)

Chronic

Decrease in working hours and uptime rate due to preventive measuresagainst prevailing infectious diseases

Large

Large

• F lexibly establish a crisis center• P repare infectious disease response manuals, etc., implement infection prevention measures, andmitigate the impact on operations, based on the experience gained in responding to COVID19

Resource
efficiency

Growing need for recycled ingots reflecting the need to reduce CO 2
emissions (Reduce the amount of new ingots used and expand the useof recycled materials. Possibility of meeting the needs through theevolution of compounding technology at the Kumagaya Plant)
Increasing demand for recycled materials

Physical risks

Energy source

Decrease in renewable energy procurement costs due to thedevelopment of new policies and systems related to renewable energy

Opportunities

Increase in sales of climate change mitigation and adaptation products

Large

Large

with other company-wide risks and are subject to evaluation andmanagement by the Risk Management Secretariat.

Risk management process
Board of Directors Meeting
Supervise

ReportApproval / Instruction

Sustainability Meeting
Identify and analyze
sustainability-related risks,
mainly related to climate change

Propose /ReportRisk Management Secretariat
Formulation and progress monitoringof risk management plan

Deployment of approval / instruction

Responsible Dept. / Site

Deliberate / Report plan

Responsible Dept. / Site

Propose / Report

Responsible Dept. / Site

Responsible Dept. / Site

Identify and analyze to prevent / reduce independent risks related to dept. / site•M
 ultifaceted initiatives (CO2 reduction, vehicle weight reduction, CNDC development) ongoing as
company-wide key strategic items in the 10-year business plan and medium-term 3-year policy• P roactive disclosure and external communication on efforts to reduce CO2 emissions, the importance ofactivities as part of business strategies, targets and results, etc.
• F oster trust and earn high credit by strengthening engagement with stakeholders• C ollect information on trends in environmental regulations and CO2 emissions reduction policies, andswiftly reflect the results based on impact analysis in business strategies for each region

Small• E xplore compounding and melting technologies• P ropose the use of aluminum ingots using recycled materials

Small• P romote measures to reduce CO2 emissions (introduction of solar power generation, energy conversion,energy conservation activities, purchase of renewable energy) in the challenge to achieving carbon
neutrality in 2050, and accumulate knowledge relating to the use of renewable energy• C ollect information on renewable energy procurement routes and the introduction of relevant new policies
and systems

Small• E nsure the competitiveness of aluminum die-cast products by developing and proposing demand creation
technologies that focus on the superiority of LCA (low CO2 emissions, recyclability) and the characteristics(light weight, flexibility in shape, rigidity) of aluminum die-cast products• R &D of CNDC

Product/Service

MarketRisks that have been analyzed to have a large impact are integrateda) Describe the organization’s processes for identifying andassessing climate-related risks.
b) Describe the organization’s processes for managing climaterelated risks.
c) Describe how processes for identifying, assessing, andmanaging climate-related risks are integrated into theorganization’s overall risk management.

Our response policy

Decrease in market size due to materials other than aluminum replacing
steel

Large

the Sustainability Meeting.

Executive Committee Meeting• E nsure the competitiveness of aluminum die-cast products by developing and proposing demand creation
technologies that focus on superiority in LCA (low CO2 emissions, recyclability) and the characteristics (lightweight, flexibility in shape, rigidity) of aluminum die-cast products

Market trend

Marketevaluation

Data Section

Ahresty identifies climate-related risks and analyzes their impact at

Risk Management

IEA…Net Zero Emissions by 2050 Scenario, Sustainable Development
Scenario, etc.
IPCC…RCP 2.6, RCP8.5

climate change, and transition risks such as the introduction of new

Increase in procurement costs due to introduction of carbon tax, etc.

Initiatives to Support
Sustainable Growth

to be taken, the Ahresty Group extracts risks and opportunities forperiod of the medium-term management plan, and looking ahead to

Policy/regulation

Strategy and
Performance

disclosing the impact on its financial plans and the countermeasures

activities over a long period of time. In fiscal 2022-2024 which is theContents

Ahresty’s Value
Creation

Sales increase due to increase in orders for ZEV products including EVs
and FCVs (e.g. motor cases, E-Axle housings)

Large

Large

• E arn a good track record in receiving orders for electric vehicle parts and secure medium- to longterm competitiveness (expansion of customer base, improvement in competence of sales personnel,
enhancement of price (manufacturing cost) competitiveness)• S teadily receive orders for target products through the alignment of manufacturing plant strategies andsales department strategies

Increase in the proportion of aluminum die-cast products in automobile
parts due to the need for weight reduction (replacement of steel withaluminum)

Large

Large

• Increase orders for vehicle body parts (targetting of customers to be ranked up as a supplier for BEV parts
that require further weight reduction, and collect information on trends in large die castings such as gigapresses and changes in the supply chain)

Risk management process

Function

Responsible party①Risk identification /analysis

Identify risks that may affect Ahresty’s management. Analyze thepossibility of such risks becoming manifest and impact in the event of
manifestation.

Sustainability Meeting②Risk assessment

Assess risks based on the results of the risk analysis. (Identify the risks
that need to be addressed by risk management plans.)

Risk Management Secretariat③Formulation of risk management plans

For risks assessed to be subject to risk management plans, set goals
and activity plans and receive approval at the Executive Committee
Meeting.

Risk Management Secretariat④Promotion of risk avoidance/reduction activities

Promote activities to avoid/reduce identified risks based on risk
management plans.

Department responsible for the
risk
Relevant sites⑤Monitoring/management/reporting of risk
management activities

Monitor the progress status of risk management plans.
Report the activity results once a year at the Executive Committee
Meeting and the Board of Directors Meeting.

Risk Management Secretariat*CNDC = Carbon Neutral Die Casting

32

AHRESTY REPORT 2023

33

04
Ahresty’s Value
Creation

Introduction

04

Initiatives to Support Sustainable Growth

The Ahresty Group has set reduction targets for CO2 emissions,

Metrics and Targets

which account for more than 90% of its GHG emissions.
Using Scope 1 and 2 CO2 emissions as metrics, we are working toa) Disclose the metrics used by the organization to assessclimate-related risks and opportunities in line with its
strategy and risk management process.
b) Disclose Scope 1, Scope 2 and, if appropriate, Scope 3
greenhouse gas (GHG) emissions and the related risks.
c) Describe the targets used by the organization to manage
climate-related risks and opportunities and performanceagainst targets.

reduce CO2 emissions.
We plan to complete the calculation of Scope 3 CO2 emissions in thefirst half of fiscal 2023 and make additional disclosures.

[thousand t-CO2]300

Eventual CO2 emissions

194

200

fiscal 2022, we focused on CO2 emissions reduction activities and also continued to work to reduce waste and water consumption. The number ofbusiness sites that achieved their targets increased over the previous fiscal year. We will continue to advance these activities.

208

204

Waste
materials

203

Prevent
environmental
problems, suchas atmosphericpollution, water

FY2022 target

FY2022 results

Reduce the total
amount of wastematerials.

Evaluation*

Eliminate non-conforming external leaks andconforming complaint aboutcomplaints.

noise.
Corrective action was taken inboth cases.

Set an intensity target for each business site.
* Continue monitoring and improving the recyclingrate.

The target was achieved at eightof the 15 targeted business sites.

1

3

50% reduction
143
129

140

143

Reduce the total
amount of CO2
emissions to

139

100

0

FY2013
Base year

76

64

68

65

FY2019FY2020

FY2021

FY2022

Promote activities based on three pillars

Aiming at
carbon neutrality
FY2024
Target

FY2030Target1. Stop CO2 emissions
2. Convert to energy with less CO2 emissions
3. Reduce consumption of CO2 emitting energy

FY2050Targetcounter global
warming.
Reduce theconsumption ofwater used inprocesses.

Continue energy conservation activities
and implement effective items
from new innovative technologies

Scope of aggregation: All domestic manufacturing sites (8 locations) + Head Office/Technical Center, Tokyo Head Office, All overseas manufacturing sites (7 locations)
Reference source: S cope 1: We used the factors according to the purchased energy type specified in the List of Calculation Methods and Emission Factors in the Calculation, Reporting andPublication System, published by the Ministry of Environment.
Scope 2: We used the factors according to the results of each country and each fiscal year specified in the IEA Emission Factors released by IEA.

Participation in the GX League Basic Concept

Savingenergy andnaturalresources

Other

Promote social
contribution
activities.

FY2023 target

There was one non-conforming
external leak and one non-contamination, andnoise pollution.

■Scope1 emissions ■Scope2 emissions

240
220

Data Section

To reduce the environmental impact of our manufacturing processes, we have set specific environmental targets for our production activities. In

Atmosphere,
water quality,
noise, etc.

286

Initiatives to Support
Sustainable Growth

Environmental targets and results in FY2022

Environmental Medium-term target
category

CO2 emissions (Scope 1 and 2)

Strategy and
Performance

CO2 emissions intensity reduction rate:
13% reduction from FY2013 (global target)* Set an individual target for each business site.
* Positioned as priority activities for pursuing ourenvironmental roadmap and policy

Set a target for each business site.
* F or overseas business sites, set a reduction
target of 1.0% or more compared to FY2021.

Set a target for the number of times eachbusiness site should organize social contribution

The target was achieved at sevenof the 16 targeted business sites.

The target was achieved at fiveof the 11 targeted business sites.

activities related to the environment.

Social contribution activities wereconducted more frequently than in
FY2021 at all business sites after* Social contribution activities related to theenvironment refer to community clean-ups,
the preservation of Satoyama socio-ecologicalproduction landscapes, and other activities.

the implementation of measures
to prevent the spread of COVID-19
infection.

3

3

Eliminate non-conforming external leaks andcomplaints.

Set an intensity target for each businesssite.
* Continue monitoring and improving the recyclingrate.

CO2 emissions reduction rate:
25% reduction from FY2013* Positioned as priority activities for pursuing ourenvironmental roadmap and policy

Set a target for each business site.

Set a target for the number of times eachbusiness site should organize social contribution

3

activities related to the environment.
* Social contribution activities related to theenvironment refer to community clean-ups,
the preservation of Satoyama socio-ecologicalproduction landscapes, and other activities.

* Target achievement level: 1 (not achieved) < 5 (achieved)

Ahresty has endorsed the GX (Green Transformation) League Basic Concept announced by the
Ministry of Economy, Trade and Industry in January 2023, and has participated in it in association
with the full-scale operation of the GX League in April 2023. We have recognized "reducing the useof fossil fuels by improving energy efficiency, etc." as one of the important issues to be addressed.
Setting a CO2 emissions reduction target, we are promoting activities to achieve the target within
the framework of the 10-year Business Plan and Medium-Term Management Plan. Our efforts toachieve the target by 2030 and to take on the challenge of achieving carbon neutrality by 2050 are
consistent with the purpose of the GX League Basic Concept. By contributing to the realization ofa decarbonized society with initiatives through the GX League and other frameworks, we aim to
improve our corporate value and realize a sustainable society.

Results of initiatives
Discharged materials
Discharged materials shows
all the materials discharged
from business offices, including all valuable materials
and waste, except steel andaluminum.

3,633

Water consumption shows
the amount of clean waterand groundwater consumed.
Reduction in the use of water
resources has been included
in our targets since fiscal
2011.

3,000
2,000
1,000
0

34

Water consumption

（t）

4,000

2021

2022

(FY)

(Thousand m3)

746

800
600
400
200
0

2021

2022

(FY)

AHRESTY REPORT 2023

35

04
Introduction

04

Initiatives to Support Sustainable Growth

Production activities require energy and materials and involve emissions.

Material Flows (Sites in Japan)

Ahresty allocates costs to measures to reduce the environmental impact in its
manufacturing processes, including the introduction of equipment for reducing the impact.
*The figures of Material Flows are based on the sites in Japan.

INPUT (consumption)

Aluminum
resources

Aluminum alloy
ingots23,758 t

138,714 t

Fuels

Electricity

Gas

Clean water

Groundwater

Chemical materials(heavy oil,kerosene, etc.)

115,179

3,528 t104,445㎥

127,756㎥(materials subject
to internal reporting)thousand k Wh

11,913 kℓ

9,174 kg

Ahresty’s Value
Creation

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Acquisition of ISO14001:2015 certification
Ahresty has established an environmental management system based on IS014001:2015 to actively engage inenvironmental conservation activities.

EMS Registration
JUSE-EG-048

ISO14001:2015 certification acquired

Registered clients

Scope of registration:

Head Office and Technical Center / Tokyo Head Office / Tokai Plant /Manufacture and sales of pressure die castings, gravity die castings,

Higashimatsuyama Plant / Kumagaya Plant / Tokai Plant Hamamatsu

and secondary aluminum alloy ingots; design, manufacture, and/ Tokai Plant Hamakita / Tokai Plant Higashimikata / Tokai Plant

appurtenant services of special-purpose machines and peripheral

Toyohashi / Ahresty Tochigi Corporation / Ahresty Kumamoto

units for die castings; design, development, manufacture, and sales

Corporation / Ahresty Yamagata Corporation / Ahresty Die Moldof dies for die castings; design, development, manufacture, andHamamatsu Corporation (Hamamatsu Plant) / Ahresty Techno

sales of building materials, such as raised floor panels

Service Corporation
Cost calculation period: From April 1, 2022 to March 31, 2023

(Unit: thousand yen)

Environmental conservation costs
Categories

Raising environmental awareness

Costs

Initiative examples

Investments

Expenses

Pollution prevention costs

Installation, management and updating of wastewater treatment equipment, maintenance and management ofwaste gas treatment and dust collection equipment, and noise control measures

21,89045,856

Global environmental conservation
costs

Energy (electricity and heavy oil) saving activities, installation of energy saving equipment, greening of the plant
environment, and monitoring of electric power consumption

99,14737,010Recycling of water, treatment (separation and disposal) of waste, and use of recycled oil

29,509342,287

0149,640

150,545425,154

4,156

22,554tion are introduced at other business sites and then disseminated

8,644

throughout the Group, to help reduce the environmental impact andActivity examples

preserve the environment in local communities.

• Lake Hamana clean-up campaign

Resource recycling costs

Sales of valuable materials (The amount of income is entered in the costs column.)
Subtotal

Ahresty hosts various educational events and communication activities related to the environment to raise its employees’ environmental awareness.

Ahresty Green Convention

Natural environment protection activities

Ahresty Green Convention is an assembly held under the Environ-

Ahresty is actively involved in activities to protect the natural

mental Policy to report on improvements in a broad range of envi-

environment based on employees’ view that they want to contributeronment-related fields. Effective activities reported at the Conven-to environmental protection outside of work.

Upstream and downstream costs

Purchasing of green materials

Management activity costs

Company-wide or site Environmental Committee, internal auditing, measuring of the levels of smoke, dioxin,
exhaust gas and noise, internal education and training, and maintenance of ISO14001 certification0

Research and development costs

Research and development of environmental impact reduction technology, etc.

00Social activities costs

Holding of plant tours, community clean-up activities, community communication activities, volunteer activities,
and NPO donations

0

225

Environmental damage
countermeasure costs

Pollution load charges

0

1,489

4,156

32,912

Tokai Plant

Reduction of compressor power consumption• Tenryu River clean-up campaign

149,640

Ahresty Die Mold
Hamamatsu

Reduction of CO2 emissions through the improvement of coolingbush hole machining processes• "Welcome turtles" clean-up campaign

308,426

Ahresty Techno Service

Reducing the number of copy sheets used

• 530 (zero waste) campaign in Kumagaya Industrial Park, etc.

Ahresty Kumamoto

Reduction of electricity consumption in the Processing Section

Higashimatsuyama
Plant

Reduction of CO2 emission intensity for the use of heavy oil andcasting machines

Kumagaya Plant

Reduction of electricity-derived CO2 emissions

Ahresty Yamagata

Reduction of energy intensity for melting

Ahresty Tochigi

Reduction of energy intensity for melting in No. 2 furnace

Subtotal

Income total

154,701

Total* Investments: Expenditure on items recorded as fixed assets, such as equipment * Expenses: Other expenditure

OUTPUT (production and emissions)Cases of improvements reported at the 20th Ahresty
Green Convention
Sites

Theme

• Volunteer activities in Iwaya Ryokuchi• Meeting for appreciating the nature of the Arakawa River andKumagaya• Clean-up of the Flower Road and Adopt-a-River activities

Ahresty eco License
Product
production
volumeAluminum alloy ingots
Production volume

Die production volume(including components)[Kumagaya Plant][Die group]

68,574 t

20,930 t

59* For the CO2 emission factor for electricity in Scope 2, information on IEA emission factors is used.

36

CO2

Discharged water

Waste

Waste

93,274 t-CO2

76,803㎥(recycling)(final disposal)

1,379 t42 t

Ahresty has established the Ahresty eco License, a unique internal
examination system, to improve its employees’ awareness of theenvironment. Over 80% of the employees have passed the examination to date, and they undertake their daily business activities with ahigher level of environmental awareness.

AHRESTY REPORT 2023

37

04
Introduction

04

Initiatives to Support Sustainable Growth

Ahresty’s Value
Creation

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Social: D evelopment of a corporate culture in which
everyone can work in good health and feel safe
Hu ma n Rights
The Ahresty Group aims to realize a prosperous society by pursuing and promoting the integration of Research, Service, Technology. Therefore, we

Initiative examples

Supporting the participation of women

1. Maintenance and improvement of health

The Ahresty Group has declared the realization of diversity in the• Encouraging employees to receive medical consultation after

2040 Vision, and has set "diversification of management (gender,

rights the Ahresty Group Human Rights Policy based on the Guiding Principles on Business and Human Rights by the United Nations Human Rights

health checkups

nationality, work history, age, etc.)," "a female employee ratio of atCouncil.

• Promoting improvement of lifestyle habits

least 20% (domestic)," and "a female managerial position ratio of at

Ahresty Group Human Rights Policy⇒ https://www.ahresty.co.jp/en/company/csr/human_rights/• Preventing health problems due to long working hours

least 10% (domestic)" as KGIs (key goal indicators). To achieve these

believe it is our responsibility to respect the human rights of all people involved in our business, and hereby establish as our policy to respect human

2. Creating a comfortable workplace environment• Supporting employees in balancing medical treatment and work

Promotion system
For human rights-related activities, the details of our initiatives
are checked and reported at the Sustainability Meeting (see"Sustainability promotion system" on page 31), which is chaired by
the Director of the General Administrative Command.

surveys targeting not only the 3TG minerals (Tantalum, Tin, Tungsten,and Gold) but also cobalt, which poses concerns about the risk ofhuman rights violations, such as child labor and unsafe working
environments at mining sites.
We will promote human rights due diligence while assessing thedegree of impact on human rights and expanding the targets and• Ensuring proper working hours
3. Mental health care
• Encouraging employees to receive stress checks• Providing health consultation for employees under high stress• Enhancing the consultation system (introducing EAP)

scope of our initiatives.

In fiscal 2022, we informed our suppliers of our human rights policy.
We also conducted a questionnaire survey on labor and humanrights, targeting a total of 97 domestic and overseas suppliers related
to materials that we had judged to be highly influential on humanrights, as part of our human rights due diligence, and confirmed that
there were no problems. We have also conducted conflict mineral

He a lth a n d productivity management—Implementation of impact assessment, preventive/corrective
actions, monitoring, etc.
•Supply chain management (implementation of questionnaire
surveys on human rights and labor, implementation of conflictminerals surveys, etc.)

our goals, "ensure your satisfaction with Ahresty," in the 2040 Vision.

System for promoting health and productivity management
Health and Productivity Management
Promotion Manager
President & COO

the absolute trust of our customers, a daily blending of theory and

Safety andEnvironment Dept.

pride in their work.

Each business site

Each business site

Each business siteOHS Committee

OHS Committee

OHS Committee

38

This is the second certification it has received, following last year.

This program certifies large enterprises, SMEs, and other corporations that practice
particularly excellent health and productivity management based on their initiatives foraddressing local health issues and health promotion initiatives promoted by Nippon Kenko
Kaigi.

Granted the highest rank Eruboshi Certification as a women’s
empowerment company,
Ahresty acquired the highest rank (three-star) Eruboshi Certificationfrom the Minister of Health, Labour and Welfare based on the Act
on Promotion of Women’s Participation and Advancement in the
Workplace.
■What is Eruboshi Certification?

Under this certification program, the Minister of Health, Labourand Welfare certifies companies that are superior in terms of
empowerment of female employees and meet certain criteria basedon the Act on Promotion of Women’s Participation and Advancementin the Workplace (hereinafter referred to as the "Act on Promotion of
Women’s Participation").

Employing persons with disabilities
On October 1, 2020, Ahresty established Ahresty Inclusive Service
Corporation to promote the recruitment and training of employees

Granted Silver Certification as an excellent health company

the Employment of Persons with Disabilities on June 14, 2021. It is

Ahresty renewed and acquired Silver Certification, following

a shared service company in charge of clerical operations to help

2021, from the Tokyo Federation of Health Insurance Societies

improve the efficiency of administrative work within the Group,

as an excellent health company that has made a health company

where all staff members, including disabled employees, play active

declaration, and is actively working to improve the workplaceroles appropriate for their respective aptitudes.

environment and promote employee health for health andCertified as an excellent enterprise under the Monisu Certification

productivity management.

ProgramAhresty Inclusive Service Corporation was certified as an excellent

Based on the belief that the health of employees and their families
is essential for the sustainable growth of Ahresty, we position• Changes over Time of Ahresty’s Health and Productivity Management

the promotion and maintenance of employee health as one of our• Diversity List of Ahresty’s Employees

important management tasks, and have introduced "health and• Ahresty’s Health Map Chart

productivity management."⇒https://www.ahresty.co.jp/company/csr/safety_health(in Japanese)* Health and Productivity Management is a registered trademark of Nonprofit Organization
Kenkokeiei.

the Ministry of Economy, Trade and Industry and Nippon Kenko Kaigi.

work styles, and the improvement of workplaces.

certified as a special subsidiary company under the Act to Facilitate

Human Resources Dept.

experimentation and of originality and invention is vital. We believethat all of these can be achieved if each of our employees takes

Outstanding Organizations Recognition Program hosted jointly byand operation of human capital strategies, the provision of career
support, the establishment of programs that help realize various

with disabilities and create workplaces in which many different kindsof people work together. Ahresty Inclusive Service Corporation was

We are working to offer superior products with quality that exceeds
expectations and services that satisfy customer needs. To win

Management Outstanding Organization 2023 (large enterprise■What is the Certified Health & Productivity Management Outstanding
Organizations Recognition Program?

Philosophy of "Let us take pride in our work, respect theory andproducts and service to our customers," aiming to achieve one of

Ahresty was recognized as a Certified Health & Productivity
category) under the Certified Health & Productivity Management• Provision of internal education and training

Ahresty conducts its corporate activities under its Corporate
experimentation, value originality and invention, and offer superior

Organization 2023 (large enterprise category)

Human rights due diligenceon the Act on Promotion of Women’s Participation and Advancementin the Workplace. Aiming to be a company where diverse humanresources can play an active role, we are promoting the formulation• Preventing passive smoking

Certified as a Health & Productivity Management Outstanding

Initiative examples

goals, we have formulated the General Employer Action Plan based

enterprise under the Monisu Certification Program, which certifies■What is Silver Certification?

Under this certification program, a company
that has declared to insurers that the entire
company will work to promote good health andhas then achieved a certain level of results iscertified as an excellent health company.

small and medium-sized enterprises excelling in the employment of
persons with disabilities, run by the Ministry of Health, Labour andExcellent Health Company Certification No.: Kengin No. 1613 (1)Certification period: July 1, 2022 to June 30, 2023 (renewedcertification)

Welfare.
■What is the Monisu Certification Program?

This is a program in which the Minister of Health, Labour andWelfare certifies small and medium-sized enterprises that excel
in promoting the employment of people with disabilities andstabilizing their employment.

AHRESTY REPORT 2023

39

04
Introduction

04

Initiatives to Support Sustainable Growth

Occupational Safety and Health Policy

Ahresty’s Value
Creation

Eliminating industrial accidents and injuries
Upholding a safety slogan for the three years from fiscal 2022 to 2024,

Top Management’s Commitment
Top management will establish occupational safety and health management systems todevelop and maintain a working environment where all workers at the Ahresty Group canwork without risk to health and safety.
Top management will also establish an OHS Committee at each site, which reflects any

Ahresty Safety Principles
1. Safety shall be the first priority
over any other operations.
2. Safety shall be more impor-feedback from the workers to the systems to promote continual improvement.

3. Safety shall always take priority over production efficiency.

We at Ahresty will:

4. Safety shall begin with orga-

1. work with Ahresty Safety Awareness in mind;

workplace safe and comfortable for workers. Mainly targeting"Find potential hazards in your workplace!
Think and act safely by observing the rules!"operations that require the use of heavy tools or the handling ofheavy items, we are implementing Kaizen initiatives to reduce
workloads while employing automation and Karakuri mechanisms to

Initiative examples• Patrolling using a special check sheet

areas.

• Structuring an ideal form of anzen-dojo (intensive safety training)

3. comply with occupational safety and health requirements, such as national andlocal laws and regulations; andEach and every one of us shall• Strengthening safety activities by setting monthly themes for safetyenhancement•Providing safety and health education and conducting safety
conscious human evaluation• Improving equipment safety specifications• Improving fire prevention capabilities through fire prevention selfinspection• Promoting pedestrian-vehicle separation for forklifts
Ahresty as a whole aims to develop a safe and comfortable working
environment by carrying out a variety of safety activities, including

Occupational safety and health management system

restructuring an anzen-dojo (intensive safety training) program,

Workload reduced by using a hand craneIndustrial accidents■Number of accidents ■Number of accidents
involving lost working not involving losttime
working time

(Cases)40

Rate of accidents
Rate of accidents
involving and not
involving lost working
involving lost working time
(Rate)
time
4

which will be the core of our safety training, enhancing patrols

President

and fire prevention, improving equipment safety functions, andEntire company
General Safety and Health Administrator of the Group

operations involving highly physical workloads and making theimprove production efficiency.

• Promoting machine safety and risk assessment for explosions and firefor zero accidents.

Using ergonomics to create workplaces withlow workloads

Safety slogan for the three years from fiscal 2022 to 2024

nizing and cleaning of work

practice the principles, aiming

Data Section

We continuously improve the workplace environment by reducing

2. work toward occupational safety and health goals to achieve a healthy workplacewith zero accidents;

4. strive to develop a safety working environment and raise safety awarenessthrough involvement in occupational health and safety activities, such as risk
assessment, education and training, HHK and KY activities.

Initiatives to Support
Sustainable Growth

Ahresty conducts production activities with safety as its top priority.

tant than any other work.

Our Declaration

Strategy and
Performance(Plant General Manager Meeting)

All-Ahresty OHS Secretariat

General Safety and Health Administrators

20

0

All-Ahresty Safety and Health Administrators Meeting
Each Safety and Health Administrator

Each business site

Each business site

Each business site

Each business site

Each business site

General Safety and
Health Administrator

General Safety and
Health Administrator

General Safety and
Health Administrator

General Safety and
Health Administrator

General Safety and
Health Administrator

Safety and HealthAdministrator

Safety and HealthAdministrator

Safety and HealthAdministrator

Safety and HealthAdministrator

Safety and HealthAdministrator

OHS
promotion department

OHS
promotion department

OHS
promotion department

OHS
promotion department

OHS
promotion department

Safety sense training: Blind spots from a forklift

2

6

10

(Safety and Environment Section)

3

1.26

strengthening measures to prevent fire and explosions.

All-Ahresty OHS Committee(General Manager of the Safety and Environment Dept.)

30

11
2013

2014

2015

2016

2017

2018

2019

2020

2021

1

0.45

2022

0

(FY)

* Rate = Number of accidents × 1,000,000 / Total working hours* From FY2017, also includes the number of accidents resulting from poor ergonomics* From FY2018, also includes the number of accidents on our premises involving contracted
construction workers

Ahresty Techno Service Corporation granted the Shizuoka Labor Bureau Director's Excellence Award
Ahresty Techno Service Corporation was granted the FY2022 Shizuoka Labor Bureau Director's
Excellence Award by the Shizuoka Labor Bureau, as a workplace that has particularly excellent
safety and health standards and serves as a model for others. It was highly evaluated for actively
promoting occupational safety and health activities, including having a particularly long accident-free
period and making efforts to reduce risks in the workplace.

* The occupational safety and health organization of each business site shall be based on its organization chart.

40

AHRESTY REPORT 2023

41

04
Introduction

04

Initiatives to Support Sustainable Growth

Ahresty’s Value
Creation

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Governance: Improving corporate governanceCorporate governance system chart

Corporate Governance

Ensuring the effectiveness of the Board of
Directors

General Meeting of Shareholders

Ahresty believes that the basic policies of corporate governanceshould be to clarify its management responsibilities andaccountability to all its shareholders and other stakeholders andto establish a management system capable of making decisions
promptly with a high level of transparency. Ahresty also focusesAppointments
and dismissals

Nomination & Compensation
Committee
The majority of members are
Independent Directors.
Consulting

Directors

governance, including setting up the Nomination and Compensation

Corporate governance system

Reporting andproposingInternal audit(excluding directors who are members of the
Audit and Supervisory Committee)

Directors who are members of the
Audit and Supervisory Committee

4

Representative Director
Reporting andproposing

Advice andguidance

Reporting

Divisionsimprovement measures that lead to increased corporate value.

Executive

remuneration

under

the

stock

Since fiscal 2018, Ahresty has introduced a restricted stockcompensation plan in the remuneration system to further promote

Lawyergreater linkage with medium- to long-term performance goals, andIndependent Directors

4

Replaced the chairperson of theNomination and Compensation Committee with an Independent Director.

2019
Nomination and Compensation
Committee started working.

2018
Corporate Governance Codeformulated.
Stewardship Codeformulated.

Restricted stock compensation plan introduced.
Evaluation of the effectiveness of the Board of
Directors (questionnaire survey) introduced.

2015

2016

2014

Responding to overseas market expansion

Finance / Accounting / Capital
policyStrengthening the Group’s profitability andfinancial base

Legal affairs / Risk management

Advancing management for appropriate
risk management

Global (international
experience)

Carrying out management corresponding to
the expansion of overseas business

Human resources / ESG

Responding to sustainability management

Effectiveness evaluation / Skill matrix

2021* With a resolution at the Board of Directors meeting held on March 22, 2021, an
Independent Director was appointed as the chairperson of the committee.

Sales / Marketing

corporate value of Ahresty.

Name

Full
time

Responsibility / Expertise

Manufacturing/ Quality /Technology
development

Sales /
Marketing

Finance /Accounting /Capital policy

Legal affairs/ Riskmanagement

Global(international
experience)

Human
resources /ESG

Chairman & CEO

Arata Takahashi○

Chief Executive Officer

●

●

●

●

●

●

President & COO

Shinichi Takahashi○

Chief Operating Officer
Manufacturing Command

○

●

●

●

●

Representative Director

Naoyuki Kaneta○

Sales Command
Chief of the Quality
Assurance Command○

Director

Hideki Nariya○

Chief of the General
Administrative Command

●

●

○

●

Director who is a member of the
Audit and Supervisory Committee

Kazuyuki Sakai

○

●

●

●

Director who is a member of the
Audit and Supervisory Committee

Shuhei Shiozawa

Doctor of Economics○●

Director who is a member of the
Audit and Supervisory Committee

Akiyoshi Mori

LawyerDirector who is a member of the
Audit and Supervisory Committee

Kimiko Terai

Doctor of Economics

Director who is a member of the
Audit and Supervisory Committee

Toshihiro Matsuba

Corporate manager

Current position

Nomination and Compensation Committee (6 members)
2

Contributing to world-class manufacturing

to provide executives with an incentive to continuously improve theHistory of corporate governance reforms

Improvements to governance inline with Corporate Governance Code.

2015
Became a company with an Audit andSupervisory Committee.

42

restrictedcompensation plan

Expected image
Responding to rapid electrification

Manufacturing / Quality /Technology development

results are reported to the Board of Directors and are used to formulate(including 4 Independent Directors)

Inside Directors

Required knowledge, experience,
and abilities

to achieve sustainable growth and increase corporate value over

Advice andguidance

Collaboration

5

match more closely the needs of the times.

shared value between executives and stakeholders, to establish

Business Divisions
Group companies

year, we updated the skill matrix so that the skill requirements would

shareholders and investors are summarized, and the summarization

Making decisions and executing
basic matters related to internal
control system development

Instructions

experience, and abilities of directors are appropriate. In this fiscal

through questionnaires and opinions obtained through dialogue with

Executive Committee
Executive Officers

Board of Directors (9 directors)
Directors

Auditing andsupervising

Making decisions on and executing
specific matters related tointernal control system maintenanceof Directors are properly performed and to improve them, aiming

Ahresty has introduced a skill matrix to ensure that the knowledge,

the medium to long term. The results of self-evaluation by directors

Appointments, dismissals,
Accounting
and supervision
Reporting(Representative Director,
Chairman)Internal Audit Department

Director in 2021.

ReportingInstructions

Committee in 2019 to discuss the appointment/dismissal of directors,
replacing the chairperson of the Committee with an Independent

ReportingAccounting
Auditors

Global Compliance Committee

Auditing andsupervising

Ahresty has implemented various initiatives to enhance its corporate

their remuneration, and requirements for director candidates, andof Directors to verify whether the functions expected of the Board

Collaboration
Reportingbecame a company with an audit and supervisory committee in 2015,

Ahresty conducts an evaluation of the effectiveness of the Board

Reporting

Audit & Supervisory
Committee Directors /Independent Directors

Reporting

Collaboration

supervising the business activities of the entire Group. Since it

Evaluation of the effectiveness of the Board of Directors

Appointments
and dismissals

Board of Directors

its efforts on improving its internal control and risk management
systems, and establishing a management system capable ofAppointments
and dismissals

Updating the skill matrix of directors

●

●

●
●

●
●
●

●

●
●

●：Having direct knowledge, experience, ability, etc. ○：Having relevant knowledge, experience, ability, etc.

AHRESTY REPORT 2023

43

04
Introduction

04

Initiatives to Support Sustainable Growth

Ahresty’s Value
Creation

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Introduction of new Independent Directors
Group’s corporate value. We have established the Compliance

Risk management

Principles and the Ahresty Group’s Code of Conduct as compliance

The basis of Ahresty’s risk management is to avoid risks that may
seriously affect its business management and address any risks thatarise, promptly and properly in a manner that will not undermine
the safety, health or interests of any stakeholder so as to achieve aquick recovery while working to protect its management resources
and minimize any damage from the risk, thereby ensuring continuityof its business management. Based on its Risk Management Regulations established for risks associated with business activities,
Ahresty identifies, analyzes and evaluates risks regularly in light ofthe environment and trends both inside and outside the Company,
holds discussions on priority activities and their aims, and checks
improvements to risk management systems and frameworks for theentire Group.

executives and regular employees. By continuously disseminatingthem in a timely and appropriate manner, we are working to prevent

Ahresty selected 16 risk items as its priority risk management items
for fiscal 2022 and appointed departments to be responsible for eachrisk. These included "transactions and compliance," "disasters,"
and "products and services." By clarifying the degree of impact
and causes of each risk, Ahresty has been working to enhance
prevention, initial response and measures for recovery.

FY2022 risk management items and initiatives to enhance
responses (excerpts)

My area of expertisecompliance violations. We will conduct fair and honest businessactivities while not only observing laws, regulations, and internal
rules, but also complying with the corporate ethics demanded bysociety.

Kimiko Terai
Initiatives for information security

Professor at the Faculty of
Economics, Keio University

The risk of cyber-attacks targeting companies, which may affect

After serving as a researcher at
the Research Department of theTokyo Shisei Chosa Kai (currently
the Tokyo Institute for Municipal
Research), a visiting scholar at the
University of California, Irvine, andProfessor at the Faculty of Business
Administration, Hosei University,
she assumed her current positionin 2012. She has deep insight andbroad experience as an economist
and is familiar with the financial
sector, including the social security
system.

plant operations, has been increasing.
As a company that plays a role in the supply chain, Ahresty recognizes the importance of security issues. We have established internal

Identifying and responding to risks

Contributing to the improvement of corporate value from two
perspectives: economics and the empowerment of womenstandards to be observed by all employees, including bothrules and regulations, strengthened management of information devices, and limited access to information, thereby preventing leakage
of information due to internal fraud or external cyber-attacks, etc. In
general, the following approaches are promoted.

1. Approach from human perspectives

Disasters(Typhoon, heavy rain)

Compliance(Harassment)

Regional conflict

Based on the belief that preventing harassment andmaintaining a sound workplace environment is part of its
social responsibility, Ahresty has established a code of
conduct and action guidelines for prevention while providing
internal training for all employees, to eliminate harassment inall workplaces.
Ahresty has collected signs of risks that could affect the Groupon a global basis due to regional conflicts. We are working tostrengthen our system so that in the event of risks that have amajor impact on the Group’s production and earnings, relevant
departments and sites will work together to promptly consider
countermeasures.

Expectations for Ahresty
I look forward to seeing Ahresty transform witha sense of urgency in terms of both achievingcarbon neutrality at production sites and providing
environmentally friendly products. I will fulfill my role
as a director so that such transformation will lead to
improved corporate value.

mation security-related accidents in their daily operations, and act
properly if an information security incident, such as a data leak,

Striving to ensure effective management decisions from amultifaceted perspective based on my experience

2. Approach from perspectives of regulations/

My area of expertiserules, and devices/equipment
Ahresty has established rules and guidelines on information management and information security, strengthened management of
information devices, and limited access to information, thereby
preventing leakage of information due to internal fraud or externalcyber-attacks, etc. At the same time, Ahresty works to ensure that
individuals are informed about these operations so that they canproperly manage information.

3. Approach to risk management in teleworking
As changes in workstyles, such as teleworking, have been accelerating since the outbreak of COVID-19, it is increasingly necessary to

44

I have participated in various governmental activities
and academic conferences, and I am aware of
information on environmental policies and trends infinance and social security related to environmental
issues. I believe that such information can also be
used at manufacturing sites from the perspective ofsocial needs.
I would like to make suggestions regarding theimplementation of specific measures, such asedge about information security, pay attention not to cause infor-

Measures to ensure business continuity
Formulated guidelines for responses to typhoons and heavy
rain, and implemented measures against disasters, such as
the introduction of emergency communication devices.

Roles that can be fulfilled as an Independent
Director

dialogue with on-site staff, for the promotion of worklife balance and the realization of diversity. I would
also like to make use of my experience in working
to help women balance their private and work lives,and gradually gain the ability to speak out in a fielddominated by men. I believe that if we increase thenumber of female employees, raise the ratio of female
managers, and eventually appoint female directors
from within the company, there will be a significant
change in terms of diversity. I hope that I will be able
to help incorporate the perspectives of women into
management.

Ahresty promotes education to enable employees to have knowl-

occurs.
Risk management item

My major is economics. From the perspective of
economics, I have gained knowledge about themagnitude of the impact the automotive industry
has on society, the role it is expected to play in the
future, and the things that need to be kept in mind as
it develops. I would like to make use of this knowledge
in my mission.

Complianceprevent data leaks and other information risks. Ahresty requires all

Ahresty considers the trust of its stakeholders to be the starting

reinforced measures such as ensuring compliance with information

point in conducting all of its business activities, and maintains amanagement rules and prohibiting any act that may be associatedmanagement philosophy of making constant efforts to raise thewith leakage of information.

its employees to raise their awareness of information risks and has

Toshihiro Matsuba
Director, Head of the Technology& Development Administration
Dept., Nippon Light Metal
Holdings Co, Ltd.

After joining Nippon Light Metal Co., Ltd.,he worked as Head of the Technology
Department of the Shimizu Plant; Headof the Development Department of the
Shimizu Plant; Head of the Overseas
Operations Department of the Chemicals
Division; and Head of the Shimizu Plant. He
became Officer and Head of the Chemicals
Division in 2017, and Managing Directorand Executive Officer of Nippon Light Metal
Co., Ltd. and Director and Head of theTechnology & Development Administration
Department of Nippon Light Metal Holdings
Co., Ltd. in 2021.

My major is chemistry. I have cultivated a wide
range of knowledge through technology. In addition
to being involved in domestic and overseas projects
and the start-up of plants, I have worked with various
large and small customers to engage in application
development and marketing. Overseas, in particular,
I have visited more than 20 countries in Asia, Europe,and North America, as well as the Amazon rainforest
in Brazil. From my experience of communicating andnegotiating with people of different backgrounds
from different countries, differing in terms of common
sense, ways of thinking, and culture, I believe that thekey to success lies in whether we can understandthe true needs of customers and how well we cantranslate them into product characteristics. I believethat this is common to the manufacturing industry.

Roles that can be fulfilled as an Independent
Director
I will strive to ensure more efficient and effective
management decisions by providing suggestions
and examples from a third-party and technicalperspective based on my business experience
with various people, including those overseas. In
particular, since companies tend to be single-minded
when it comes to presenting a direction, I would liketo suggest that your company be multi-faceted bypresenting new perspectives at such times.

Expectations for Ahresty
I believe that the key is how quickly management
decisions can be made. Currently, it is questioned
how to respond to weight reduction for mobility, whichleads to social contribution. I expect your company tofirmly grasp the need for weight reduction, leveraging
the advantage of die casting, which allows parts withcomplex shapes to be produced at once.

AHRESTY REPORT 2023

45

04
Ahresty’s Value
Creation

Introduction

04

Initiatives to Support Sustainable Growth

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Interview with an Independent Director

Ahresty’s corporate
governance supporting
sustainable growth
The automotive industry is facing a once-in-a-century period of change. In a situation where
various changes, such as responses to carbon neutrality and the electrification of powertrains,are progressing at a rapid pace, we asked Mr. Shiozawa’s view on corporate governance, whichis the foundation that supports the enhancement of Ahresty’s corporate value.

Independent Director (Audit & Supervisory
Committee member)
Chairperson of the Nomination andCompensation Committee

Shuhei Shiozawa

Please tell us about the system for selecting the
Directors of Ahresty.
First of all, discussion begins with what kind of
human resources are needed. After discussing
the desired roles and skills, we proceed to thenext processes, such as selecting candidates.

Nomination and Compensation
Committee
Board of Directors
General Meeting

For candidate selection:
A list is created by the President.
Checked by the Nomination andCompensation Committee

A list is created by the current
department managers.
Discussed and selected by the
Next-Generation Human Resources
Development Committee▲

Please tell us about your perceived need to
improve governance.
Ahresty is a manufacturing company. You
can clearly see the results of manufacturing,such as the quality of products, by looking at
manufactured products. Since standards areclear, it is easy to express opinions. I think this isrooted in the corporate culture of Ahresty, whichfeatures openness. The Board of Directors is
also influenced by this corporate culture. Even
now, there are occasional opportunities toexchange views with on-site staff. However, if
such opportunities are provided on a regularbasis, or if meetings are held for discussion
only among Independent Directors, a Board of
Directors’ meeting will be a place that allows
for a more in-depth discussion.

case of Independent Directors, their skills
can be objectively assessed based on theirbackgrounds and qualifications. However,since it is difficult to judge their aptitudes andpersonalities as directors, we have to meetthem in person to make a judgment.
Finally, please tell us what you expect from thenew management system that has started since
March.
I expect the President to respond flexibly
without being constrained by the past. In
the rapidly changing automotive industry, it
is important to understand risks. In order to
respond to risks in changing circumstances,flexibility is a key point. Since the President
has held a wide range of responsibilities sincejoining Ahresty, including serving as Director
at a domestic plant and a manufacturingsite in the U.S., General Manager of the IT
System Department, and Chief of the General
Administrative Command, in addition to his
experience at a company in the IT industry, I
expect that he will be able to respond flexibly
without being bound to a narrow industry.
There are limits to what one person can do. It
is important how he will use the people aroundhim. I would like him to make good use of theInternal and External Directors.

Introduction ofInde p e n d e n t D i r e c t o r s
Independent Director(Audit and Supervisory
Committee member)

Shuhei
Shiozawa
Councilor and Professor of the Faculty of Economics,
Tokyo International University; Former President,
Tokyo International University; Professor Emeritus,
Keio University; Outside Director, KYB Corporation
Reason for appointment: He was deemed to bequalified for the position because he is a professorof economics specializing in theoretical economics
and financial theory, with extensive experience andinsight as a university professor of economics andas a president.

Independent Director(Audit and Supervisory
Committee member)

Akiyoshi Mori
Lawyer, Mori & Kikuchi Law Office
Reason for appointment: He was deemed to bequalified for the position because he has extensive
experience as a lawyer over many years andspecialized knowledge of corporate legal affairs.

(Figure 1) Approach to training director candidates▲

46

Please give your view on the composition of theBoard of Directors in relation to the attributes ofIndependent Directors.
The Board of Directors consists of nine
directors, four of whom are Independent
Directors. Its composition, with more than
one-third of the members being Independent
Directors, allows people outside the company
to keep an eye on the company. Here, it isimportant to discuss whether the knowledge,
experience, and abilities of the directors are inline with Ahresty’s strategy, and what kind ofskill matrix is required of the Board of Directors.
For the skill matrix for 2023, human resources
and ESG items have been added to strengthen
the monitoring function for the company’s
initiatives aimed at resolving social issues.

The Board of Directors has a division-of-worksystem that allows each director to make themost of their expertise while demonstrating
their strengths as a whole. Under the 10-year
Business Plan that started in fiscal 2022, Ahresty
is working to expand the use of aluminum diecast products. The use of aluminum makes
vehicles lighter, which indirectly contributes tomitigating the impact of climate change. In order
for a company to grow sustainably together
with society, it is important to think about how
it can make the best contribution through its
core business. At the Board of Directors, there
is an opinion that discussion should be madebased on the knowledge of each member undera business philosophy that aims for a triple-win
for the buyer, the seller, and society, and we arehaving discussions in this direction.

▲ ▲What do you think are the characteristics ofAhresty’s governance?
I have been a Director and Audit andSupervisory Committee member of Ahresty
since 2017, and 2023 will my sixth year inthis position. From my experience so far, I
believe that Ahresty’s governance is steadily
evolving, with the establishment of theNomination and Compensation Committee in2019 and the appointment of an Independent
Director as the chairperson of the Nomination
and Compensation Committee in 2021. The
Nomination and Compensation Committee is anadvisory body that discusses matters, such as
the appointment and remuneration of directors
and requirements for director candidates. Witha majority of Independent Directors, it canmake decisions from an objective perspective
without being bound to the preconceptions of
the company. The view of people inside thecompany is different from that of those outside
the company. In this respect, I believe that thetransparency and objectivity of the decisionmaking process have improved compared tobefore the establishment of the committee.
As for myself, since I became the chairpersonof the Nomination and Compensation
Committee, I have had more opportunities toreceive briefings from the secretariat before
the meetings of the committee and havegained even more information. Although theBoard of Directors and the Nomination andCompensation Committee have always had free

and open discussion, I am working to improve
the quality and depth of discussion as thechairperson.
Currently, the automotive industry is facing
a once-in-a-century period of change. In
this situation, it is important for the Board of
Directors to accurately understand risks, andeach member of the Board of Directors needs
to be aware of changes, anticipate risks, andconsider countermeasures in their respective
areas of expertise. We cannot change theprobability of occurrence of events, such as
the COVID-19 pandemic or Russia’s invasionof Ukraine. However, we can predict what will
happen after the outbreak of an event and canchange our coping strategies. Furthermore,
we can change the probability of occurrenceof an event if it is attributable to the company,
such as a plant accident or a product quality
defect. I believe that the role of people outside
the company who can take an objective view isto understand what can be changed to ensurethat there are no unexpected surprises, while
making the most of their respective areas ofexpertise.

Specifically, we prepare a human resources
roadmap, determine requirements for thenecessary human resources and candidates
at each level, and prioritize the training ofsuch candidates. In particular, regarding
the selection and training of candidates fora department manager or higher position,
we operate a system in which we cultivate
their skills as a director step by step (Figure1). After stepping them up to the position ofa department manager, chief, and executive
officer in a phased manner, we implement a
strategic assignment approach as a measure
to train directors. This is a hands-on humanresources development measure that provides
opportunities for director candidates to gain
experience by actually experiencing important
posts and projects according to the candidate
requirements. Once a year, the Nomination
and Compensation Committee examines the
skill matrix of candidates created based on theevaluation results of strategic assignments tocheck if a review is necessary (Figure 2).
The difficult part of running the PDCA cycle
for a candidate training plan is assessing
the future potential of candidates after thenumber of candidates is narrowed down tosome extent. It is necessary to gauge whether
they can perform as well in their next position
as they do now. On the other hand, in the

Assuming three tofive years ahead

Management training
New director training

Independent Director(Audit and Supervisory
Committee member)

Strategic assignments (Tough assignments)
Explanations and Q&As to management andoutsiders Acquisition of management
knowledge (training, etc.)

Kimiko Terai

Directors
Directortraining plan

Candidatepool
Executive Officers /Chiefs /Department managers
Department
manager candidates

Next-Generation
Human Resources
Development
Committee

For department managers: Top manager training
For department manager candidates:
Policy leaders (assignments)
MONOZUKURI JUKU (manufacturing cram school)for next-generation plant manager education

Professor at the Faculty of Economics, Keio
University
Reason for appointment: She was deemed tobe qualified for the position because she has deep
insight and broad experience as an economist, andis an academic expert familiar with the financial
sector, including the social security system.

(Figure 2) Director training process• Clarification of the roles and functions required of
the future Board of Directors• Clarification of the required skills and abilities
in terms of both the current composition of the Boardof Directors and the future vision
Phase 1Clarification of important posts and requirements
for realizing the vision and management strategies
Phase 4Re-evaluation and review of measures related tothe evaluation of training results
Checked by the Nomination
and Compensation Committee
once a year

P
Personnel
affairs ofmanagement

C/A• Evaluation of training results• Re-evaluation and review ofa training plan

• Understanding of the skills and abilities ofinternal human resources• Formulation of human resource selection
criteria and procedures
Phase 2
Understanding and evaluation of human resources /Selection and securing of candidates
Phase 3
Formulation and implementation of a humanresources development plan / Development ofand support for training environments

D• Formulation of individual training plans in linewith the objectives• Examination of work experience and posts
necessary for human resources development /Operation of the necessary job duties and posts• Development and implementation of effective
training menus

Independent Director(Audit and Supervisory
Committee member)

Toshihiro
Matsuba
Director, Head of the Technology & Development
Administration Department, Nippon Light Metal
Holdings Co., Ltd.
Reason for appointment: He was deemed to bequalified for the position because he has extensive
work experience and insight that he has cultivatedas a director and executive officer of a non-ferrous
metal company.

AHRESTY REPORT 2023

47

05
Ahresty’s Value
Creation

Introduction

05

Data Section

Strategy and
Performance

Initiatives to Support
Sustainable Growth

Data Section

Key financial, human resources and environmental data
for the 10-year period(Unit: million yen)
FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

Segment information

Operating results
Net sales

Japan segment die casting

126,783

138,727

144,451

136,657

145,167

145,428

120,577

92,973116,313140,938

4,449

2,521

5,385

6,912

4,718

3,228

764

△2,554△2,42223

Net sales

62,22863,226

63,58363,00866,81867,98859,50045,58451,74659,019

3.5

1.8

3.7

5.1

3.3

2.2

0.6

△ 2.7

△2.1

0.0

Segment income

3,656

3,230

2,769

2,519

1,458

871

△444

△2,491△1,372250

Recurring income

4,012

1,622

4,077

6,256

4,436

2,905

406

△2,094△2,032

94

Segment assets

45,433

46,86948,372

51,61454,52554,83453,77355,94051,71750,832

Net income attributable toowners of parent

5,888

332

1,963

4,620

3,450

421

△685

△2,843△5,189△84

Comprehensive income

11,895

7,002△1,310

3,171

3,971

△3,574△3,175△1,788△2,267

3,288

33,90640,65445,76040,85439,93739,801

30,633

21,62828,111

36,995

Segment income

509△1,295

1,521

2,163

291

123

635

94

△1,096△676

Segment assets

40,93747,27945,272

41,40938,173

32,95429,47829,78731,064

31,597

24,14327,584

27,594

26,12830,422

29,971

23,846

19,931

26,48833,676

Segment income

180

662

573

1,758

2,378

1,841

3

△598

△547

8

Segment assets

42,63546,85940,37836,99539,27137,94338,29137,80742,12842,163

4,657

5,015

4,921

4,402

4,597

4,679

3,993

3,483

6,463

7,975

Segment income

△6

5

338

274

213

112

169

33

265

274

Segment assets

2,609

3,030

2,527

2,773

3,344

3,019

2,388

2,758

4,350

4,085

1,848

2,245

2,590

2,263

3,371

2,976

2,603

2,345

3,503

3,271

Segment income

66

83

212

155

392

314

277

320

312

285

Segment assets

1,000

1,397

1,797

1,213

1,997

2,194

1,282

1,018

2,573

3,271

Japan

68,85670,61870,72369,28874,27875,196

65,69951,122

61,42370,001

North America

33,576

40,73145,82740,90940,07739,91630,71921,71028,19537,09523,80627,192

27,66526,24830,52030,05823,89019,95526,54733,709

544

185

235

212

290

257

268

185

146

132

45.7

49.1

51.0

49.3

48.8

48.3

45.6

45.0

47.2

50.3

7,044

7,373

7,055

7,215

7,268

7,337

6,780

6,124

5,940

5,499

Operating income
Operating income margin (%)

Financial condition
Total assets

136,816

147,577

139,496

135,044

137,751

128,222

123,054

132,223

131,302

137,069

Net assets

54,17560,84959,262

62,05365,43961,29357,36455,63153,566

56,649Interest-bearing debts

43,014

46,83842,44832,80431,55230,737

33,69545,92042,91643,519Per share information
Net assets per share (yen)2,094.75

2,351.99

2,287.83

2,394.58

2,522.55

2,357.98

2,244.49

2,161.08

2,068.69

2,180.28

Net income per share (yen)269.52

12.86

75.97

178.77133.4016.26△26.77△111.06△201.23△ 3.26

Dividends per share (yen)

14

12

14

20

26

22

8

5

10

10

Equity ratio (%)

39.5

41.2

42.4

45.8

47.4

47.7

46.5

41.9

40.7

41.2

Return on equity (%)

12.6

0.6

3.3

7.6

5.4

0.7

△1.2

△5.0

△9.5

△0.1

Price-earnings ratio (%)*

3.2

59.8

9.6

6.4

7.1

38.9

-

-

-

-

Return on assets (%)

4.3

0.2

1.4

3.4

2.5

0.3

△ 0.5

△ 2.2

△ 3.9

△ 0.1

D/E ratio

0.8

0.8

0.7

0.5

0.5

0.5

0.6

0.8

0.8

0.8

Dividend payout ratio(consolidated) (%)*1

5.2

93.3

18.4

11.2

19.5

135.3

-

-

-

-

North America segment die casting
Net sales

Asia segment die casting
Net sales

Aluminum

Financial index

1Cash flows

Proprietary products
Net sales

Net sales by region

Cash flows from operating
activities

11,835

12,502

18,062

21,77916,90816,01816,474

7,942

8,259

10,727

Asia

Cash flows from investing
activities△12,671△15,211△14,648△12,932△16,795△14,150△17,691△11,570△6,083△6,331Other regions

Cash flows from financing
activities

3,012

△538

△4,372△9,004△1,391△1,392

2,162

11,940△5,101△1,534

Percentage of overseas sales (%)*3

Free cash flow

△836

△2,709

3,414

8,847

113

1,868

△1,217△3,628

2,176

4,396

Year-end balance of cash
and cash equivalents

8,791

5,789

4,505

4,100

2,630

2,901

3,732

12,2499,356

12,991

Capital expenditures*2
Depreciation

10,518
11,153

Human resources and environment data
Consolidated number of
employees (persons)Capital expenditures and depreciation

9,841
12,956

9,064
14,877

7,046
13,781

10,962
14,89910,59516,011

13,821
14,3297,497
12,901

6,044
11,9196,899

Percentage of female
employees (%)

-

-

-

-

-

-

-

-

-

17.4

12,906Percentage of female
managers (%)

-

-

-

-

-

-

-

-

-

10.3

CO2 emissions (thousand
t-CO2)*5

286

278

271

264

260

249

220

194

208

204

*1 Since the price-earnings ratio and dividend payout ratio (consolidated) for fiscal year ended March 31, 2020, fiscal year ended March 31, 2021, fiscal year ended March 31, 2022, and fiscal year ended March 31,
2023 are not shown due to net loss attributable to owners of parent.
*2 The capital expenditures exclude those for “dies” included in tools, furniture and fixtures.

48

Net sales*3 The percentage of overseas sales is categorized by country or region based on the location of each customer.
*4 Figures are after the application of the "Accounting Standard for Revenue Recognition" from fiscal year ended March 31, 2022.
*5 Figures from fiscal year ended March 31, 2014 to fiscal year ended March 31, 2017 do not include those from company cars, cafeterias, and other items with minor impact.

AHRESTY REPORT 2023

49

05

05

Consolidated Financial Highlights
Net sales

Operating income / Operating income margin
Operating income ■1st half ■2nd half

140,938 million yen

23 million yen / 0.0%

2,000

6

60,0001,000

340,0000

020,000-1,000-3

0-2,000-6

FY2023(Forecast)

The impact of the semiconductor supply shortage and other factors gradually eased in
the second half of the year; however, the decline in automobile production in the firsthalf had a negative impact, and sales volume increased only 2.7% year on year. Sales
increased 21% due to higher aluminum ingot prices and a weaker yen.

Net income / Net income margin
Net income ■1st half ■2nd half

Net income margin

FY2022

FY2023(Forecast)

（%）

（%）

1,000

3

2

0

0

-1,000-3-2,000-6-9-3,000

FY2022

Established

November 2, 1943

Takahashi
ArataShinichi
Takahashi

Director,Director,
Representative
Independent Director(Audit & Supervisory
President
and Managing
COO
SeniorExecutive Officer (Audit and Supervisory Committee member)

Shuhei Independent
Shiozawa Director

Yasutaka
Executive
Officer Oshima

Committee member)
Akiyoshi
Mori

Koichi
Asai Officer
Executive

ShinichiTakahashi
Naoyuki
KanetaRepresentative Director,
Director
Senior Managing Executive Officer

Committee
member)Independent
Director(Audit andIndependent
Supervisory Committee
Director member)

Director,
Kazuyuki
Sakai
Managing
Executive Officer

Independent
Director member)Committee(Audit and Supervisory Committee member)(Audit & Supervisory
Naoyuki
KanetaCommittee member)

Kimiko (Audit
Terai & Supervisory

Shuichi
AsakunoToshihiro
Matsuba

Koichi Asai

KojiExecutive
Arai Officer

Executive
Officer Mine
Kenichiro

Yasutaka Oshima

Executive Officer

Executive Officer

AtsushiMine
Shimizu
Kenichiro
Executive Officer

Atsushi Shimizu

Stock Information

Distribution by type of shareholder

Kazuyuki Sakai(As of March 31, 2022)

Authorized shares: 60,000,000 shares
Financial instruments firms 2.9%
Issued shares: 26,076,717 shares
Other institutions
Shareholders:
6,715
Numberof shares
andDistribution by type of shareholder
11.6%(As of March 31, 2023)
Individuals
and others
shareholders
Financial instruments firms 4.6%
49.3%
etc.
Authorized shares: 60,000,000 shares Foreign corporations,
Other institutions
Issued shares: 26,076,717 shares
13.6% 12.2%
Individuals and others
Shareholders: 7,108

50.6%

Foreign corporations, etc.
12.8%
Financial institutions
19.8%[ USA ]

Ahresty Yamagata Corporation

Ahresty Wilmington Corporation-10

Product Design, Research and Development
ISO 14001 / ISO 9001 (Die Casting Products·Raised Floor)

Die Casting, Machining, Part Assembling
ISO 14001 / IATF 16949

Die Casting, Machining, Part Assembling
ISO 14001 / IATF 16949

Ahresty Die Mold Hamamatsu Corporation[ Mexico ]Die Casting Dies
ISO 14001 / ISO 9001

Ahresty Mexicana, S.A. de C.V.

2020

2021

2022 (FY)Both ROE and ROA were negative due to the net loss for the period.

Ahresty Techno Service Corporation
Manufacture and Sales of Peripheral Equipment for Die
Cast Production
ISO 14001 / ISO 9001

Equity ratio

Tokyo Head Office30,528 million yen / 41.2%

ISO 14001 / ISO 9001 (Die Casting Products·Raised Floor)

Tokai Plant（%）

Die Casting, Machining, Part Assembling
ISO 14001 / IATF 16949

50

300

Higashimatsuyama Plant

40

100
0

2019

2020

2021

2022 (FY)Die Casting, Machining, Part Assembling, Die Casting Dies
ISO 14001 / ISO 45001 / IATF 16949[ China ]Guangzhou Ahresty Casting Co., Ltd.

Ahresty Inclusive Service Corporation

Die Casting, Machining, Part Assembling
ISO 14001 / ISO 45001 / IATF 16949

Personnel and labor related office work

Hefei Ahresty Casting Co., Ltd.
Die Casting, Machining, Part Assembling, Raised Floor
Production
ISO 14001 / ISO 45001 / IATF 16949

Ahresty Precision Die Mold (Guangzhou) Co., Ltd.
Die Casting Dies
ISO 9001

Die Casting, Machining, Part Assembling
ISO 14001 / IATF 16949[ India ]30

Kumagaya Plant

20

Aluminum Alloy Ingots Production
ISO 14001 / ISO 9001

Die Casting, Machining, Part Assembling
ISO 14001 / ISO 45001 / IATF 16949[ Thai ]200

Continuing from the previous fiscal year, we worked to curb capital expenditures andreduce investment cash flow. Free cash flow remained positive due in part to anincrease in operating cash flow.

Executive Officer

Representative Director,[ Japan ]

400

(FY)

Representative
Director, Executive Officer
Senior Managing
Chairman and CEO(Audit & Supervisory
member)Shuhei Committee
Shiozawa

Executive OfficerOfficers
Executive

Head Office and Technical Center

200

2022

Hideki Nariya

Independent Director(Audit & Supervisory
Committee
Independent
Director member)-8(100 million yen)

2021

Executive Officer-6(100 million yen)

0

Koji Arai

Akihiko Shido& Supervisory Committee member)
Number of (Audit
sharesand shareholders

Stock Information-4

10,727 million yen / 4,396 million yen

50

Representative Director,
Senior Managing Executive Officer

Managing Executive Officer

Director-2■Net interest-bearing debts

100

Independent Director(Audit & Supervisory
Committee member)

Arata Takahashi
Junji Ito
Directors

Data Section

Executive Officers

Sites Information
Sites Information■Operating cash flow

150

Initiatives to Support
Sustainable Growth

22.6%
Financial institutions

2019

Free cash flow

Strategy and
Performance

President, CEO

Hideki Nariya(0.1)% / (0.1)%

Net interest-bearing debts*3 / Equity ratio

2020

June 22, 1938

Return on assets

Operating cash flow / Free cash flow*2

2019

FoundedSingle Entity : 1,016

0

FY2023(Forecast)Despite extraordinary gains from the sale of the Higashimatsuyama Plant, we recorded
a net loss for the period due to impairment losses on fixed assets at domestic andoverseas sites, as well as special retirement benefits associated with the streamliningof production systems at overseas sites.

-50

6,964 Million

Employees	Consolidated: 5,499

Although due to the semiconductor shortage and the supply network disruption caused by China's
zero-COVID policy, the volume of orders received decreased, resulting in an operating loss in thefirst half, we streamlined our production system, reduced manufacturing costs, and concluded
price revisions and cost compensation negotiations with customers in response to soaring energy
and other prices in the second half. As a result, we recorded a profit for the full year.

Return on equity(million yen)

FY2021

FY2021

CapitalReturn on equity (ROE) / Return on assets (ROA)*1(84) million yen / (0.1)%

50

（%）

(million yen)

80,000

FY2022Company name Ahresty Corporation
Capital¥6,964 Million
FoundedJune 22, 1938
Established
November 2, 1943
Corporate Profile
Employees
Consolidated : 5,938
Single Entity: 833
Company name Ahresty
Corporation

Operating income margin(million yen)

FY2021Ahresty’s Value
Creation

Corporate ProfileInformation Directors
Corporate

Net sales ■1st half ■2nd half

-4,000Introduction

Corporate Information

Data Section

Despite the uncertainty in the global economy, including the impact of the semiconductor
shortage and the situation in Ukraine, we maintained a higher level of cash and cash
equivalents on hand than in the past, resulting in a decrease in net interest-bearing debts by
3 billion yen from the previous fiscal year and an equity ratio of 41.2%.

*1 The Partial Amendments to Accounting Standard for Tax Effect Accounting and relevant Guidelines have been applied from the beginning of the fiscal year ended March 31, 2019. These accounting standards havebeen retroactively applied to the figures for the fiscal year ended March 31, 2018.
*2 Free cash flow = Cash flows from operating activities – Cash flows from investing activities *3 Net interest-bearing debts = Interest-bearing debts - Cash and deposits

34

Ahresty India Private Limited

Ahresty Tochigi Corporation

Thai Ahresty Die Co., Ltd.

Die Casting, Machining, Part Assembling
ISO 14001 / IATF 16949

Die Casting Dies
ISO 9001

Ahresty Kumamoto Corporation

Thai Ahresty Engineering Co., Ltd.

Die Casting, Machining, Part Assembling
ISO 14001 / IATF 16949

Design of Die Castings, Die Casting Dies and 3D Modeling

AHRESTY REPORT 2023

51

Ahresty Report 2023

Financial Section
Contents
Overview of Business Performance

53

Consolidated Balance Sheets

55

Consolidated Statements of Income andStatements of Comprehensive Income

57

Consolidated Statements of Changes in Net Assets 59
Consolidated Statements of Cash Flows

61

Notes to Consolidated Financial Statements

6252

Ahresty Report 2023

Overview of Business Performance

Results of Operations(2) Consolidated financial position

During the consolidated fiscal year under review, the uncertainty in the world economy continued due mainly to high energy andfood prices resulting from the Russian invasion of Ukraine, tightening supply of labor and worsening inflation mainly in the U.S.,
and the zero-COVID policy and subsequent lifting of the policy in China. The central banks of various countries focused theirefforts on tightening their monetary policy to suppress inflation. In the U.S., in particular, the FRB has been continuing to raise thepolicy interest rate. Regarding the future outlook, the economies of Europe and the U.S. are expected to enter a recession phase
due to the impact of inflation and rising interest rates resulting from high energy and food prices. The Chinese economy, with thelifting of the zero-COVID policy, is expected to recover gradually mainly from service consumption, though the real estate market
will remain stagnant. In Japan, although high commodity prices and the slowdown in the overseas economy are negative factors,
the Japanese economy is expected to recover mainly from service consumption and inbound demand and maintain positive
growth, while other major advanced countries will suffer negative growth.
Under these economic circumstances, the Ahresty Group made continuous efforts to improve production efficiency, such as
flexible adjustment of the number of operating days and personnel placement according to fluctuations in the volume of orders
received from automobile companies in each country or region, and the utilization of idle internal facilities to reduce capital
investment. However, the shortage in supply of semiconductors and China’s zero-COVID policy associated with confusion in
supply chains resulted in a significant decline in automobile production, leading to a decrease in the volume of orders received.
Moreover, the soaring energy prices boosted production costs. Mainly due to these factors, the first half of the fiscal year underreview recorded an operating loss. In the second half of the fiscal year, due to the effect of efforts to improve efficiency inproduction systems, as well as improvement in the semiconductor supply condition and the settlement of negotiations with major
customers on price revisions and cost compensation in response to soaring energy prices, we were able to recover profit, andrecorded slight surpluses for operating income and recurring income on a consolidated full-year basis. Moving ahead, althoughattention needs to be paid to possible risks, such as resurgence of the shortage of semiconductors, intensification of competition
between Japanese automobile companies with local manufacturers in the Chinese market, and the impact of the economic
slowdown in the U.S. market, we predict that the recovery trend of our business performance will continue.
Starting from the consolidated fiscal year under review, the Ahresty Group has promoted its 10-year Business Plan, a long-term
management plan toward fiscal 2030, and the 2224 Medium-Term Management Plan, the milestone plan for the first three years of
the 10-year Business Plan. Under the 2224 Medium-Term Management Plan, in response to changes in the external environment,such as the acceleration of electrification of automobiles and moves toward carbon neutrality, we set “establishing low-cost,highly productive MONOZUKURI,” “reducing CO 2 emissions in production,” and “shifting the business portfolio to predominantly
parts for electric vehicles” as the pillars of our strategy. Based on these pillars, we are making efforts to secure net sales, improve
productivity, and enhance our earnings strength.
As a result, the Group recorded consolidated net sales of ¥140,938 million (up 21.2% year on year), operating income of ¥23
million (compared to an operating loss of ¥2,422 million for the previous year), and recurring income of ¥94 million (compared toa recurring loss of ¥2,032 million for the previous year). Due to the occurrence of an impairment loss on fixed assets and otherfactors, net loss attributable to owners of parent turned out to be ¥84 million. (The previous year recorded a net loss attributableto owners of parent of ¥5,189 million.)

Total assets

Net assets

Equity ratio

million yen

million yen%

yenYear ended March 2023

137,069

56,64941.2

2,180.28

Year ended March 2022

131,30253,56640.7

2,068.69(Reference) Shareholders’ equity Year ended March 2023 56,527 million yen Year ended March 2022 53,426 million yen(3) Consolidated cash flows
Cash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities

Year-end balanceof cash and cash
equivalents

million yen

million yen

million yen

million yen

Year ended March 2023

10,727(6,331)(1,534)

12,991

Year ended March 2022

8,259

(6,083)(5,101)

9,356

Outlook for fiscal year ending March 2024
In the fiscal year ending March 2024, economies in Europe and the U.S. are likely to enter a recession phase due to the impact ofinflation and rising interest rates resulting from high energy and food prices, while the Chinese economy, with the zero-COVID policy
lifted, is expected to recover gradually mainly from service consumption. The Japanese economy is expected to recover mainly
from service consumption and inbound demand in line with the spread of the “with COVID” lifestyle, and maintain positive growth.
In the automobile market, although the shortage of semiconductors will continue to ease, the improvement is likely to slow down. In
addition, we must pay attention to events that may have a negative impact on our business performance, such as the intensificationof competition between Japanese car manufacturers, which are our main customers, and Chinese EV manufacturers in the Chinese
market, and the ongoing tight labor market in the U.S.
Regarding the performance of the Ahresty Group, the recovery in earnings is likely to slow down in the first half of the year ending
March 2024 along with the delay in production recovery of some of our major customers in the Chinese market. On a full-year basis,
however, we expect increases in both sales and profits starting from the year ended March 2023, with income returning to the black.
In response to the ongoing high energy and labor costs, we will continue to properly reflect them in prices. Furthermore, under the2224 Medium-term Management Plan, which started from the consolidated fiscal year under review, the Group will work to strengthen
its profit-making structure, increase the rate of sales for electric vehicles, and enhance the business in vehicle body components. At
the same time, we will promote initiatives toward carbon neutrality.
Under these circumstances, our forecasts for consolidated business results for the year ending March 2024 are as follows.
Incidentally, our foreign exchange assumptions are as follows: 130.0 yen to the USD, 19.0 yen to the CNY, 1.60 yen to the INR, and20.0 Mexican pesos to the USD.** Our consolidated subsidiary in Mexico adopts the U.S. dollar as its functional currency. However, tax expenses of the Mexican subsidiary arecalculated based on the Mexican peso and are therefore influenced by the MXN/USD exchange rate.

(Million yen)

Consolidated performance for year ended March 2023 ( April 1, 2022– March 31, 2023)(Amounts of less than 1 million yen are rounded off )Net sales(1) Consolidated operating results(% shows the year-on-year change)
Net sales

Operating income

Recurring income

million yen

million yen%

Net income attributableto owners of parent

million yen%%

million yen

Year ended March 2023

140,938

21.2

23

–

94

–

(84)

–

Year ended March 2022

116,31325.1(2,422)–(2,032)–(5,189)–Net income
per share

Fully diluted net
income per share

yen

Return on
total assets

Operatingincome on sales

yen

%

%

%

Year ended March 2023

(3.26)

–

(0.1)

0.1

0.0

Year ended March 2022

(201.23)

–

(9.5)

(1.5)

(2.1)

(Reference) Investment gain or loss under equity method
Year ended March 2022 – million yen

53

Return on
equityYear ended March 2023

Operating income Recurring income

Net income
attributable toowners of parent

Year ending March 2024 forecasts

150,000

2,200

1,600

Year ended March 2023 results

140,938

23

94

(84)

Difference

9,061

2,176

1,505

1,184

Percentage change (%)

6.43

–

–

–

%

(Note) C omprehensive income Year ended March 2023 3,288 million yen (_%) Year ended March 2022
(2,267) million yen (_%)
(Reference) E
 BITDA Year ended March 2023 12,929 million yen (36.1%) Year ended March 2022
9,496 million yen (-8.2%)* EBITDA = operating income + depreciation and amortization

Net assets
per share

Net sales

1,100

Segment profit

Year ended March
2023

Year ending
March 2024

Year ended March
2023

Year ending
March 2024

Die casting in Japan

59,019Die casting in North America

36,99562,000250

650

41,000(676)

Die casting in Asia

900

33,676

34,700850Aluminum

7,975

7,300

274

200

Proprietary products

3,271

5,000

285

400

–

–

(120)

–

140,938

150,000

23

2,200

Segment

Elimination of intersegment transactions
Total– million yen

54Ahresty Report 2023

Consolidated Balance Sheets
Note:T he translations of yen amounts into U.S. dollar amounts are included solely for the convenience of readers
outside Japan and have been made at the rate of ¥134.95 to $1.00, the average exchange rate during period.
U.S. dollar figures less than a thousand dollars are rounded down to the nearest thousand dollars.

Million yen

Previous consolidated
fiscal year
(March 31, 2022)(Assets)

Million yen

Thousands of U.S. dollars

Consolidated fiscal year
under review(March 31, 2023)

Consolidated fiscal year
under review(March 31, 2023)(Liabilities)

Previous consolidated
fiscal year
(March 31, 2022)

Thousands of U.S. dollars

Consolidated fiscal year
under review(March 31, 2023)

Consolidated fiscal year
under review(March 31, 2023)

Current liabilities

Current assets
Cash and time deposits¥9,356¥12,991$96,271

Notes and accounts payable¥11,557¥11,670$86,478

Trade notes and accounts receivable, and contract assets ＊1

26,631

27,140201,116

Electronically recorded obligations – operating

8,125

9,144

67,759

Electronically recorded monetary claims – operating

3,207

4,116

30,502

Short-term loans

16,714

18,599137,823

Merchandise and products

4,228

6,304

46,714Current portion of long-term loans

8,381

10,60078,551

Partly finished goods

5,450

5,637

41,774

Accrued income taxes

Raw materials and inventories

3,234

3,462

25,656

Bonus allowances

Others

1,459

1,823

13,512

Provision for product warranties

46

53

393

Allowance for doubtful accounts

(148)

(176)

(1,307)

Others

6,793

7,532

55,81753,41961,299454,242

Total current liabilities

53,261

59,277439,254

17,821

14,319106,111

170

123

912

Total current assets

84

147

1,092

1,559

1,530

11,339Long-term liabilities
Fixed assets

Long-term loans

Tangible fixed assets

Long-term accounts payable

Buildings and structures

31,60032,592

241,517

Deferred tax liabilities

2,414

2,234

16,557

Accumulated depreciation and impairment loss

(17,409)(19,071)(141,321)

Net defined benefit liability

2,918

3,305

24,497

Buildings and structures, net

14,19013,521

100,196

Others

1,149

1,159

8,588

135,529

140,599

1,041,861

Total long-term liabilities

24,474

21,142

156,667

Accumulated depreciation and impairment loss

(97,511)(104,237)(772,413)

77,73680,419595,921

Machinery and delivery equipment, net

38,01836,362

269,448

51,605

Machinery and delivery equipment

Tools, furniture and fixtures

35,35235,880265,881(28,723)(28,941)(214,461)

6,629

6,939

51,420Common stock

6,964

6,964

Land

5,454

5,076

37,619Additional paid-in capital

10,206

10,20675,628

Lease assets

1,262

1,703

12,625Retained earnings

30,83430,454

225,672

Accumulated depreciation and impairment loss

(613)

(921)

(6,828)

(166)

(58)

(431)

Lease assets, net

648

782

5,797

47,83747,566352,474

Construction in progress

7,387

7,221

53,515

Total tangible fixed assets

72,32869,903517,996

Intangible fixed assets

1,783

1,642

12,170

1,281

1,261

9,344

Accumulated depreciation and impairment loss
Tools, furniture and fixtures, net

Investments and other assets
Investment securities
Net defined benefit asset

＊2

263

–

–

1,816

2,337

17,317

Others

425

641

4,750

Allowance for doubtful accounts

(16)

(15)

(117)

Deferred tax assets

Total investments and other assets
Total fixed assets
Total assets

55

Total liabilities

3,770

4,223

31,29477,88375,769561,462¥131,302¥137,069$1,015,704(Net assets)
Shareholders’ equity

Treasury stock
Total shareholders’ equity
Other accumulated comprehensive income
Difference on revaluation of other marketable securities
Foreign currency translation adjustments

549

538

3,991

5,593

9,026

66,891Remeasurements of defined benefit plans

(555)

(604)

(4,478)

Total other accumulated comprehensive income

5,588

8,961

66,404

Share warrants

140

121

903

Total net assets

53,566

56,649419,782¥131,302¥137,069$1,015,704

Total liabilities and net assets

56Ahresty Report 2023

Consolidated Statements of Income and Statements of Comprehensive Income(Consolidated Statement of Comprehensive Income)(Consolidated Statements of Income )Million yen(Million yen)Thousands of U.S. dollars

Previous consolidated
fiscal year
(April 1, 2021 toMarch 31, 2022)

Consolidated fiscal year
under review(April 1, 2022 toMarch 31, 2023)

Consolidated fiscal year
under review(April 1, 2022 toMarch 31, 2023)¥(5,189)¥(84)

		$(625)

Difference on revaluation of other marketablesecurities(1,596)(10)

		 (81)

Foreign currency translation adjustments

4,611

3,432

		25,439

Remeasurements of defined benefit plans

(92)

(48)

		 (362)

2,921

3,373

		24,995(2,267)3,288

		24,370(2,267)3,288

		24,370¥–¥–

Net sales＊1¥116,313¥140,938$1,044,375

Cost of goods sold＊2

108,689

130,457

966,710

7,623

10,48077,665

Transportation expenses

1,511

1,652

12,241

Salaries and bonuses

3,190

3,089

22,893Retirement benefit expenses

205

199

1,478

Provision for bonuses

283

302

2,238

411

411

3,052

Comprehensive income attributable to:

556

558

4,140

Owners of parent

Other expenses

3,885

4,243

31,447

Total selling, general and administrative expenses

10,046

10,457

77,493(2,422)23

172

Gross profit
Selling, general and administrative expenses

Depreciation and amortization
Research and development expenses＊3

Operating income (or loss)

Thousands of U.S. dollars

Previous consolidated
fiscal year
(April 1, 2021 toMarch 31, 2022)

Consolidated fiscal year
under review(April 1, 2022 toMarch 31, 2023)
Net income (loss)

Consolidated fiscal year
under review(April 1, 2022 toMarch 31, 2023)

Other comprehensive income

Total other comprehensive income
Comprehensive income

Non-controlling interests

＊

		

$–

Non-operating income
Interest income

44

51

378

Dividends received

103

44

329

Foreign currency exchange gain

276

355

2,636

Gain on sales of scraps

205

230

1,710

Employment adjustment subsidies

227

147

1,091

Others

82

80

599

Total non-operating income

940

910

6,747

Interest expenses

505

759

5,627

Others

44

79

591

Total non-operating expenses

550

839

6,219

Recurring income (or loss)(2,032)

94

700

34

3,208

23,772

2,304

–

–

Non-operating expenses

Extraordinary gains
Gain on sales of fixed assets＊4Gain on sales of investment securities
Subsidy income＊5

Total extraordinary gains

198

132

980

2,537

3,340

24,752Extraordinary losses
Loss on sales and retirement of fixed assets ＊6

245

214

1,588

＊7

4,228

2,378

17,627Retirement benefit expenses

–

448

3,325

Special retirement expenses

–

368

2,731
25,272

Impairment loss

4,473

3,410

(3,968)

24

180

357

661

4,904

Deferred income taxes

863

(553)

(4,099)Total income taxes

1,221

108

805

Total extraordinary losses
Income (loss) before income taxes and others
Income taxes and enterprise taxes

Net income (loss)
Net income (loss) attributable to owners of parent

57(5,189)

(84)

(625)

¥(5,189)¥(84)$(625)

58

Ahresty Report 2023

Consolidated Statements of Changes in Net Assets

Previous consolidated fiscal year (April 1, 2021 to March 31, 2022)(Million yen)

(Million yen)

Other accumulated comprehensive income

Shareholders’ equity

Balance at beginning of fiscal year

¥6,964

Additional
paid-in capital¥10,206¥35,909¥(278)

Cumulative effect of changes inaccounting policy

–

–

394

–

394

Balance at beginning of fiscal year
reflecting changes in accounting policy

6,964

10,20636,303(278)

53,195

Common stock

ChangesCash dividend from retained earnings

Retained earnings

Treasury stock

–

–

(257)

–

(257)

Net income (loss) attributable toowners of parent––(5,189)–(5,189)Purchase of treasury stock
Disposal of treasury stock

–
–

–
–

–
(22)

(0)
112

(0)
89

Changes (net) in non-shareholders’equity items

–

–

–

–

–

–
¥6,964–¥10,206(5,469)¥30,834

111¥(166)(5,357)¥47,837

Total changes
Balance at end of fiscal year

Difference on
Total otherForeign currency Remeasurements
revaluation of other translation of defined benefit accumulated
marketable
comprehensive
adjustments
plans
securities
incomeTotal shareholders’equity¥52,801
Balance at beginning of fiscal year
ChangesCash dividend from retained earnings
Net income (loss) attributable toowners of parent
Purchase of treasury stock
Disposal of treasury stock
Changes (net) in non-shareholders’equity items
Total changes
Balance at end of fiscal year

Share
warrants

Total net
assets¥549¥5,593¥(555)¥5,588¥140¥53,566

–

–

–

–

–

(258)

–

–

–

–

–

(84)

–
–

–
–

–
–

–
–

–
–

(0)
71

(10)

3,433

(48)

3,373

(18)

3,354

(10)
¥538

3,433
¥9,026(48)¥(604)

3,373¥8,961

(18)
¥121

3,083
¥56,649

Current consolidated fiscal year (April 1, 2022 through March 31, 2023)(Thousands of U.S. dollars)
Shareholders’ equity(Million yen)

Difference on Foreign currency Remeasurements
Total otherrevaluation of
accumulatedtranslationof defined benefit comprehensive
other marketable adjustments
plans
securities
incomeBalance at beginning of fiscal year

¥2,146

Cumulative effect of changes inaccounting policy
Balance at beginning of fiscal year
reflecting changes in accounting policy
ChangesCash dividend from retained earnings

¥982
–

2,146

¥(462)–

982–¥2,666––

Share
warrants

Total net
assets¥164¥55,631

–

(462)

2,666

–

–
164

–

394
56,026–(257)

Net income (loss) attributable toowners of parent

–

–

–

–

–

(5,189)Purchase of treasury stock
Disposal of treasury stock

–
–

–
–

–
–

–
–

–
–

(0)
89

Changes (net) in non-shareholders’equity items
Total changes
Balance at end of fiscal year

$51,605

Additional
paid-in capital$75,628

51,60575,628

Common stock

Other accumulated comprehensive income(1,596)

4,611

(92)

2,921

(24)

2,897

(1,596)¥549

4,611¥5,593(92)¥(555)

2,921¥5,588(24)¥140(2,459)¥53,566

Balance at beginning of current fiscal year

$228,484

Treasurystock$(1,232)

Total shareholders’equity$354,486

228,484(1,232)354,486

Retained earnings

Cumulative effect of changes inaccounting policy
Balance at beginning of fiscal year
reflecting changes in accounting policy
ChangesCash dividend from retained earnings(1,917)(1,917)

(625)

(625)

Net income (loss) attributable toowners of parent
Purchase of treasury stock
Disposal of treasury stock
Changes (net) in non-shareholders’equity items
Total changes
Balance at end of current fiscal year

$51,605$75,628

(270)

(1)
802

(1)
532

(2,812)$225,672

801$(431)(2,011)$352,474(Thousands of U.S. dollars)
Other accumulated comprehensive income

Consolidated fiscal year under review (April 1, 2022 to March 31, 2023)(Million yen)
Shareholders’ equity¥6,964

Additional
paid-in capital¥10,206

–

–

(258)

–

(258)

–

–

(84)

–

(84)
(0)

Common stock
Balance at beginning of fiscal year
ChangesCash dividend from retained earnings
Net income (loss) attributable toowners of parent
Purchase of treasury stock
Disposal of treasury stock
Changes (net) in non-shareholders’equity items
Total changes
Balance at end of fiscal year

59

Retained earnings

Treasury stock¥30,834¥(166)

Total shareholders’equity¥47,837

–
–

–
–

–
(36)

(0)
108

71

–

–

–

–

–

–
¥6,964–¥10,206(379)¥30,454

108
¥(58)

(271)
¥47,566

Balance at beginning of current fiscal year

Total otherRemeasurements
accumulatedof defined benefit comprehensive
plansincomeDifference onrevaluation of othermarketablesecurities

Foreigncurrencytranslation
adjustments$4,073$41,451$(4,116)

4,073

41,451(4,116)

Share
warrants

Total net
assets$41,408$1,039$396,934

41,408

1,039

396,934

Cumulative effect of changes inaccounting policy
Balance at beginning of fiscal year
reflecting changes in accounting policy
ChangesCash dividend from retained earnings(1,917)

Net income (loss) attributable toowners of parent
Purchase of treasury stock
Disposal of treasury stock
Changes (net) in non-shareholders’equity items
Total changes
Balance at end of current fiscal year

(625)
(1)
532
(81)

25,439(362)

24,995(135)

24,860(81)$3,991

25,439$66,891(362)$(4,478)

24,995$66,404

(135)
$903

22,848$419,782

60

Ahresty Report 2023

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements

Million yen

Thousands of U.S. dollars

Previous consolidated Consolidated fiscal
fiscal year
year under review(April 1, 2021 to(April 1, 2022 toMarch 31, 2022)
March 31, 2023)

Consolidated fiscal year
under review(April 1, 2022 toMarch 31, 2023)

Cash flows from operating activities(1) C o n s o l i d a t e d s u b s i d i a r i e s c o n s i s t o f 1 2 c o m p a n i e s : A h r e s t y To c h i g i C o r p o r a t i o n , A h r e s t y K u m a m o t oCorporation, Ahresty Yamagata Corporation, Ahresty W ilmington Corporation, Ahresty Techno Service
Corporation, Ahresty Die Mold Hamamatsu Corporation, Thai Ahresty Die Co., Ltd., Guangzhou Ahresty Casting

Income (loss) before income taxes and others(3,968)24

180

Depreciation and amortization

11,91912,906

95,636Ahresty Precision Die Mold (Guangzhou) Co., Ltd.

Impairment loss

4,228

2,378

17,627Ahresty Die Mold Hamamatsu Corporation, a consolidated subsidiary of the Company, absorbed Ahresty Die

Increase (decrease) in bonus allowances

(61)

(57)

(429)

Mold Tochigi Corporation and Ahresty Die Mold Kumamoto Corporation, which were consolidated subsidiaries

Increase (decrease) in provision for product warranties

(34)

4

33

of the Company in the previous consolidated fiscal year, on April 1, 2022, and the Company absorbed Ahresty

Increase (decrease) in net defined benefit liability

32

330

2,450

Pretech Corporation on April 1, 2022. As a result, these three companies are excluded from the scope ofInterest and dividend income

(148)

(95)

(708)

Interest expenses

505

759

5,627

(2) T he main non-consolidated subsidiary: Thai Ahresty Engineering Co., Ltd., Ahresty Inclusive Service Corporation.

Foreign currency exchange loss (gain)

139

(406)

(3,013)It has been excluded from the scope of consolidation as they have no significant impact on the Consolidated

Loss (gain) on sales and retirement of tangible fixed assets

209(3,003)(22,259)

Financial Statements in terms of total assets, sales, current term net profit or loss (in accordance to their(2,304)

–

–

(198)

(132)

(980)

Retirement benefit expenses

–

448

3,325

Special retirement expenses

–

368

2,731

(227)

(147)

(1,091)

There are no main non-consolidated subsidiaries accounted for using the equity method. There are no affiliates.

Loss (gain) on sales of investment securities
Subsidy income

Employment adjustment subsidies

Co., Ltd., Ahresty Mexicana, S.A. de C.V., Ahresty India Private Limited, Hefei Ahresty Casting Co., Ltd. andconsolidation.

equity), and retained ear nings (in accordance to their equity).

2. Equity method affiliates

Decrease (increase) in notes and accounts receivable(3,470)(234)(1,735)The equity method is not applied to investments in Thai Ahresty Engineering Co., Ltd. and Ahresty Inclusive

Decrease (increase) in inventories(1,940)(1,835)(13,600)

Service Corporation among the non-consolidated subsidiaries, because the investments had only a slight influence

Increase (decrease) in notes and accounts payable

4,861

718

5,324

on net income/loss (an amount in accordance with equity), retained ear nings (an amount in accordance with

Increase (decrease) in accounts payable

212

51

383

Increase (decrease) in accrued consumption taxes and others

(748)

(462)

(3,430)

Increase (decrease) in long-term accounts payable – other

(68)

(47)

(352)

Others

(293)

438

3,248

8,645

12,00688,967

Interest and dividends received

148

95

708

Interest paid

(527)

(700)

(5,190)

Income taxes paid

(503)

(862)

(6,391)

Income taxes refund

81

25

185

(20)

(148)

Subtotal–

Extra retirement payments
Proceeds from subsidy income

415

183

1,360

8,259

10,72779,490(9,248)(9,888)(73,271)

Proceeds from sales of tangible fixed assets

90

3,648

27,035

Proceeds from sales of investment securities

3,020

–

–

54

(92)

(683)

(6,083)(6,331)(46,920)

Proceeds from short-term loans

117,253

150,982

1,118,800

Repayment of short-term loans(120,287)(149,745)(1,109,639)

Cash flows from operating activities
Cash flows from investing activities
Purchase of tangible fixed assets

OthersCash flows from investing activities
Cash flows from financing activities

equity), etc. and did not have sufficient importance overall.

3. Business years of consolidated subsidiaries
The closing date for consolidated subsidiaries was December 31 for Thai Ahresty Die Co., Ltd., Guangzhou
Ahresty Casting Co., Ltd., Ahresty Mexicana, S.A. de C.V., Hefei Ahresty Casting Co., Ltd. and Ahresty Precision
Die Mold (Guangzhou) Co., Ltd.
In order to prepare the Consolidated Financial Statements, the financial statements used for these subsidiaries
were as of their closing dates, except for important transactions that took place in the period before theconsolidated closing date, which were adjusted as necessary for consolidation.

4. Summary of Significant Accounting Policies(1) Evaluation standards and evaluation methods for key assets(a) Marketable securities
Other marketable securities
Securities other than shares that do not have a market value, etc.
M arket value method (variance of estimate is treated with the total net assets input method and thecost of such securities sold is determined by the moving average method)
Shares without market value
Moving average cost method is mainly adopted(b) Derivatives − market value method

Proceeds from long-term loans

7,057

6,940

51,426

Repayment of long-term loans(8,570)(9,137)(67,711)

(0)

(0)

(1)

the average method (the carrying value on the balance sheet is written down to reflect the effect of lower

Dividends paid

(257)

(257)

(1,910)profit margins), while other consolidated subsidiaries evaluate according to lower of cost method based on

Others

(295)

(315)

(2,336)(5,101)(1,534)(11,372)

Purchase of treasury stock

Cash flows from financing activities(c) Inventories
T he Company and consolidated some subsidiaries evaluate according to cost method based primarily on

the first-in, first-out (FIFO) method.
(2) Depreciation methods for important depreciable assets

32

774

5,740

Net increase (decrease) in cash and cash equivalents(2,892)

3,635

26,938

Tangible fixed assets other than die casting mold that are included in tools, fur niture and fixtures: Straight-

Cash and cash equivalents at beginning of year

12,2499,356

69,332line method

9,356

12,991

96,271

Die casting mold that are included in tools, fur niture and fixtures: Mainly the production output method

Effect of exchange rate changes on cash and cash equivalents

Cash and cash equivalents at end of year

61

1. Scope of consolidation※(a) Tangible fixed assets (excluding lease assets)

62

Ahresty Report 2023

Notes to Consolidated Financial Statements

Main useful lives are as follows:

Group, variable consideration refers to the amount of ex-post discounts (lump-sums for cost reduction) that

Machinery and delivery equipment: Between 2 years and 20 years

varies depending on the number of orders and the level of achievement of cost reduction within a period set

Tools, fur niture and fixtures (excluding die casting mold for which the production output method iswith the customer. The lump-sum expenditure for cost reduction is estimated based on the amount of the

adopted): Between 2 years and 20 years

cost reduction budget calculated by taking into consideration the ratio of cost reduction to sales or added(b) Intangible fixed assets (excluding lease assets) − straight-line method

value demanded by customers or past lump-sum expenditure for cost reduction. Although uncertainty

T he straight-line method is employed for software used in-house, based on the availability period of fiveexisted during the period because variable consideration was estimated, negotiations with customers on

years.

the amount was completed at the end of the fiscal year and therefore the uncertainty has been eliminated.

(c) Lease assets

The consideration payable to the customer refers to the purchase prices of parts that are supplied by theD epreciation is computed using the straight-line method based on the assumption that the useful life equals

customer for a charge (hereinafter referred to as “charged supply parts”) to be cast or assembled in thethe lease term and the residual value equals zero.

die-cast products the Ahresty Group manufactures and sells.

( 3) Standards for important allowances

Since sales of these products are distinct performance obligations, we do not allocate transaction prices to(a) Allowances for doubtful accounts

performance obligations but set the transaction prices as the consideration for the performance obligations.

To provide against doubtful accounts, the estimated amount of unrecoverable accounts is reported by

Incidentally, the Ahresty Group guarantees the quality of the products that it has sold to customers.

employing the loan loss ratio for regular bonds. Recovery rates are calculated individually for specificHowever, since such guarantee is provided only when the customer’s specifications are not satisfied anddoubtful accounts and bonds.

therefore the said guarantee is not deemed as a distinct performance obligation, transaction prices are not(b) Bonus allowances

allocated thereto.

In order to appropriate bonus payments for employees for the current fiscal year, the parent company andSince the payment of consideration is made within a year after the performance obligation is satisfied, it

consolidated subsidiaries report this allowance based on projected payment figures.

does not include any significant financing component.

(c) Allowance for product warranties

b. Dies, etc.

In preparation for expenses for charge-free repairs, the Company and its consolidated subsidiaries record

Regarding sales of dies, etc., taking into consideration the right to receive consideration and the time when

the provision based on estimates of different kinds of repairs and the ratio of the expenses to sales in thethe customer bears risk, our performance obligation is deemed to have been fulfilled at the time when mass

past.

production of a die-cast product starts. Therefore, revenue is recognized at the time of the start of mass

(4) Accounting method for employees’ retirement benefits(a) Period approximation method for the estimated amount of employees’ retirement benefits

production of the die-cast products manufactured using the said dies, etc. Transaction prices are
determined using the contracted transaction prices.

For the calculation of employees’ retirement benefit liabilities, the Group has adopted fixed amount

Since sales of these products are distinct performance obligations, we do not allocate transaction prices tostandards as a method of approximating the estimated amount of employees’ retirement benefits to theperformance obligations but set the transaction prices as the consideration for the performance obligations.

period up to the end of the consolidated fiscal year under review.

Since the payment of consideration is made within a year after the performance obligation is satisfied, it(b) Amortization methods for actuarial difference and prior service costs

does not include any significant financing component.

Prior service costs are amortized based on the straight-line method over a specified period (10 years) withinc. Peripheral equipment

the average remaining service period of employees at the time when such costs are incurred.

Regarding sales of peripheral equipment, the customer acquires control of the product at the time that theActuarial difference is amortized based on the straight-line method over a specified period (15 years) within

product is delivered or its installation work is completed and our performance obligation is deemed to havethe average remaining service period of employees at the time of its occurrence in each consolidated fiscal

been fulfilled at that time. Therefore, revenue is recognized at the time of acceptance by the customer.

year, and it is allocated proportionately from the fiscal year following the respective fiscal year of its

Transaction prices are determined using the contracted transaction prices.

occurrence.

Since delivery and installation of peripheral equipment are not distinct goods or services, we do not allocate(5) Standard for recognizing revenue and expenses
Details of the major performance obligations in the Ahresty Group’s primary businesses and the timing at whichrevenue is recognized are as follows.
A. Die Casting Business

transaction prices to performance obligations but set the transaction prices as the consideration for the
performance obligations. Since the payment of consideration is made within a year after the performanceobligation is satisfied, it does not include any significant financing component.
B. Aluminum Business

The Ahresty Group manufactures and sells die-cast products and metal-mold-cast products mainly for

The Ahresty Group manufactures and sells mainly secondary alloy ingots for die casting and secondary

automobiles, dies for die casting, etc., and peripheral machinery and equipment, etc. for the manufacture

alloy for castings for automobiles. Regarding the manufacture and sales of these, the customer acquiresof die-cast products. (Hereinafter, dies for die casting, etc. shall be referred to as “dies, etc.” and peripheral

control of the product at the time that the product is delivered to the customer and our performancemachinery and equipment, etc. for the manufacture of die-cast products shall be referred to as “peripheral

obligation is deemed to have been fulfilled at that time. Therefore, revenue is usually recognized at the timeequipment.”)

of delivery. However, since the Ahresty Group delivers these products only inside Japan, it takes just a few

a. Die-cast products and metal-mold-cast products

days from shipment for a product to be delivered, which is a period normally considered reasonable.

Regarding sales of die-cast products and metal-mold-cast products, when a product is delivered inside

Therefore, revenue is recognized at the time of shipment.

Japan, the customer acquires control of the product at the time that the product is delivered to the customer

Transaction prices are determined using the contracted transaction prices. Since manufacture and sales ofand our performance obligation is deemed to have been fulfilled at that time. Therefore, revenue is usuallythese products are distinct performance obligations, we do not allocate transaction prices to performancerecognized at the time of delivery. However, it takes just a few days from shipment for a product to be

obligations but set the transaction prices as the consideration for the performance obligations.

delivered, which is a period normally considered reasonable. Therefore, regarding products delivered inside

Since the payment of consideration is made within a year after the performance obligation is satisfied, itJapan, revenue is recognized at the time of shipment. For products exported overseas, since the Ahresty
Group adopts prices including carriage and insurance costs, revenue is recognized at the time of shipment

63

payable to the customer (defined later) in the contract price for each performance obligation. In the Ahresty

Buildings and structures: Between 2 years and 50 years

does not include any significant financing component.
C. Proprietary Products Businesstaking into consideration the time when the Group loses its physical possession and the time when the

The Ahresty Group is engaged in manufacturing, machining, installation and sales of mainly its “MOVAFLOR”

customer bears the risk.

raised floor system, etc. for clean rooms at semiconductor production companies, data centers at

Transaction prices are determined by reflecting the impacts of variable consideration and the consideration

telecommunications companies, and offices, etc.

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Ahresty Report 2023

Notes to Consolidated Financial Statements

Regarding installation and sales of the raised floor system, etc., when the contract includes only sales, thecustomer acquires control of the product after the product is delivered and our performance obligation is(Notes on Important Accounting Estimates)

deemed to have been fulfilled at that time. Therefore, revenue is recognized at the time of acceptance by

1. Impairment of assets related to Die Casting Businessthe customer.

(1) Amount recorded in consolidated financial statements for the consolidated fiscal year under review

When the contract includes installation, the performance obligation is deemed to be satisfied over time.

The Group’s amount of tangible fixed assets recorded in consolidated financial statements for the consolidated

Therefore, revenue is recognized based on the progress in satisfaction of the performance obligation. The

fiscal year under review is 69,903 million yen, of which 69,610 million yen is tangible fixed assets owned by the

progress is assessed based on the rate of the area of installation completed by the end of each reporting

plants of the Company and its consolidated subsidiaries belonging to the Die Casting Business, accounting forperiod to the total installation area planned in contract. For contracts whose period of installation work isvery short, revenue is not recognized over time, but revenue is recognized at the point of time when the

50.8% of total consolidated assets.
(2) Information on details of important accounting estimates concerning the identified item

installation work is completed and the customer accepts the said installed item.

Major tangible fixed assets owned by the Die Casting Business, a main business of the Ahresty Group, include

Transaction prices are determined using the contract price in each performance obligation.

casting machinery and equipment, processing machinery and equipment, and dies. Business assets are

Since delivery and installation of the raised floor system are not distinct goods or services, we do notgrouped by plant unit for which revenues and expenditures are continuously monitored, while idle assets andallocate transaction prices to performance obligations but set the transaction prices as the consideration

assets to be disposed of are grouped for each asset, to check whether there are signs of impairment losses.

for the performance obligations.

The Ahresty Group applies the Japanese accounting standards, the US accounting standards, or the

Since the payment of consideration is made within a year after the performance obligation is satisfied, itInter national Financial Reporting Standards. If the recoverable amount, whichever is higher of the net realizable

does not include any significant financing component.

value or the use value of the asset group, is lower than the book value, the amount of difference is recognized(6) Currency conversion standards for key total assets or liabilities in foreign currencies

as an impairment loss.

C ash, assets and liabilities in foreign currencies are converted into yen based on the spot exchange rate on the

The performance of the Die Casting Business is significantly influenced by the market sales condition of

consolidated closing date, and the exchange difference is treated as profit or loss. Total assets and liabilities

automobiles in which the Ahresty Group’s major products are installed and their associated production volumes.

of consolidated subsidiaries overseas are converted into yen based on the spot exchange rate on the

Due to mainly a decrease in sales of car models equipped with our major products resulting from the recent

consolidated closing date. Income and expenses are converted into yen based on the average exchange rate

spread of the COVID-19 novel coronavirus infection, some plants that belong to the Die Casting Businessduring period, and the exchange difference is included in the net assets of the foreign currency translation

segment continuously recorded operating losses, showing signs of impairment of assets. Therefore, anadjustment.

impairment test was conducted for each plant-based asset group.

(7) Hedge accounting(a) Hedge accounting methods

As a result, for the consolidated fiscal year under review, as mentioned in Notes (related to Consolidated
Statements of Income) *7 Impairment Losses, an impairment loss of 2,378 million yen was recognized at TokaiT he deferral hedge accounting method is applied. Foreign exchange contracts are appropriated when they

Plant and Higashimatsuyama Plant of Ahresty Corporation, Ahresty W ilmington Corporation and Thai Ahresty

meet the requirements for this method, and interest rate swaps are treated as exceptions when they meet

Die Co., Ltd.

the requirements for this method.

Future cash flows, which serve as the basis of the use value employed for recognition and measurement of(b) Hedge measures and hedge targets

impairment losses, are estimated according to the business plan. And the net realizable value of the assets in

Hedging instruments and hedged items to which hedge accounting is applied are as follows. There were noquestion was calculated based on various information owned by the plants belonging to this business segment,

cases to which hedge accounting was applied during the consolidated fiscal year under review.

using an exter nal professional evaluation organization, etc.

a. Hedge measures − interest rate swap

The major assumption used in the business plan is the planned production weight, which was estimated in

Hedge targets − long-term loans paid by variable interest rates
b. Hedge measures − foreign exchange contracts
Hedge targets − debts and credits in foreign currencies(c) Hedge policies

consideration of the impacts below.
- The planned production weight was calculated by considering informally disclosed information from customers(expected production volume, expected sales plan volume), market environment forecasts based on exter nal
information sources, and trend analysis of business plans formulated in preceding fiscal years and actual

F or long-term loans paid at variable interest rates, derivatives trading is used to avoid the risk of variable

figures.

interest rates. The interest rate swap provides against the risk of fluctuations in exchange rates at the time

- The impact of COVID-19 was not particularly considered in the formulation of the plan in view of the situationof import and export. The company’s accounting department conducts inter nal reviews in employing hedge

where people’s awareness has changed from “zero COVID” to “with COVID” and the economy has been

methods.

becoming stable worldwide.

(d) Methods for evaluating hedge effectiveness- Regarding the impact of the intensification of competition between Japanese car manufacturers, which areT he effectiveness of hedge transactions is evaluated by the degree of variability between the cumulative

our main customers, and Chinese EV manufacturers in the Chinese EV (electric vehicle) market, althoughamount of either the hedge target market fluctuation or cash flow fluctuation and the cumulative amount of

accurate estimation is difficult at the moment, it is assumed based on informally disclosed information fromeither the hedge means market fluctuation or cash flow fluctuation. However, the evaluation of effectivenesscustomers and other data that a certain decrease is likely in the next consolidated fiscal year and beyond.

is omitted for interest rate swaps treated as exceptions.

- Regarding the impact of the decrease in car production due to the shortage of semiconductors, although it is(8) Depreciation method and period of goodwilll

difficult to accurately determine when it will end, our assumption at the moment is that the situation willG oodwill is depreciated by straight-line method over a period of five years. If the difference to be eliminated isgradually recover in the next consolidated fiscal year and beyond though the speed of recovery is slow.

minor, it is depreciated as a lump sum in the consolidated fiscal year including the date of accrual.

- Regarding the impact of the increase in production costs due to soaring energy costs and the ongoing high(9) Scope of funds in the Consolidated Statements of Cash Flowslabor costs due to the tight labor market, it is difficult to accurately determine when it will end despite ourC ash on hand, deposits that can be withdrawn as necessary, and short-term investments that are easily

continuous efforts to properly pass on the impact to selling prices. Therefore, our assumption at the moment isconvertible, have low risk of value fluctuation and are due for redemption within three months of the date ofthat the impact will continue for a certain period of time in the next consolidated fiscal year and beyond.

acquisition are included in the scope of funds.

Please note that the assumptions used for the estimations in the business plan are subject to a high degree of(10) Other key considerations for creating the Consolidated Financial Statements

uncertainty. If any changes arise in the preconditions or assumptions based on which the estimations were

Application of a group tax sharing systemmade, such as the impact of the shortage of semiconductors associated with reduction in car production, an

A group tax sharing system has been applied to the Company and its domestic subsidiaries.

increase in production costs, and the resurgence of COVID-19 infections, an impairment loss may be recognizedin the subsequent consolidated fiscal year.

65

66

Ahresty Report 2023

Notes to Consolidated Financial Statements

2. Recoverability of deferred tax assets(1) Amount recorded in consolidated financial statements for the consolidated fiscal year under review
Deferred tax assets: 2,337 million yen(2) Information on details of important accounting estimates concerning the identified item
The Ahresty Group applies the Japanese accounting standards, the US accounting standards, or theInter national Financial Reporting Standards. Deferred tax assets are recorded for the temporary difference
between the accounting book value of assets or liabilities as of the end of the consolidated fiscal year underreview and their amounts for taxation purpose and recorded for the deductible temporary difference with regard
to losses and tax credits carried forward for which it has been determined that adequate taxable income canbe estimated based on a future business plan and that recoverability is expected.
Since the recoverability of deferred tax assets depends on the future taxable income, the estimation ofcollectable taxable income is calculated based on the business plan.
The major assumption used in the business plan is the planned production weight, which was estimated inconsideration of the impacts below.
- The planned production weight was calculated by considering informally disclosed information from customers(expected production volume, expected sales plan volume), market environment forecasts based on exter nal
information sources, and trend analysis of business plans formulated in preceding fiscal years and actual
figures.
- The impact of COVID-19 was not particularly considered in the formulation of the plan in view of the situation
where people’s awareness has changed from “zero COVID” to “with COVID” and the economy has been
becoming stable worldwide.
- Regarding the impact of the intensification of competition between Japanese car manufacturers, which are
our main customers, and Chinese EV manufacturers in the Chinese EV (electric vehicle) market, althoughaccurate estimation is difficult at the moment, it is assumed based on informally disclosed information from
customers and other data that a certain decrease is likely in the next consolidated fiscal year and beyond.
- Regarding the impact of the decrease in car production due to the shortage of semiconductors, although it isdifficult to accurately determine when it will end, our assumption at the moment is that the situation will
gradually recover in the next consolidated fiscal year and beyond though the speed of recovery is slow.
- Regarding the impact of the increase in production costs due to soaring energy costs and the ongoing highlabor costs due to the tight labor market, it is difficult to accurately determine when it will end despite ourcontinuous efforts to properly pass on the impact to selling prices. Therefore, our assumption at the moment
is that the impact will continue for a certain period of time in the next consolidated fiscal year and beyond.
Please note that the assumptions used for the estimations in the business plan are subject to a high degree of
uncertainty. If any changes arise in the preconditions or assumptions based on which the estimations were
made, such as the impact of the shortage of semiconductors associated with reduction in car production, an
increase in production costs, and the resurgence of COVID-19 infections, there is a possibility that deferred tax
assets will be reduced and tax expenses will be recorded in the subsequent consolidated fiscal year.
(Changes in Accounting Policy)(Application of Implementation Guidance on Accounting Standard for Fair Value Measurement)
The Implementation Guidance on Accounting Standard for Fair Value Measurement (ASBJ Guidance No. 31, June17, 2021) has been applied since the beginning of the consolidated fiscal year under review. In accordance withthe transitional treatment prescribed in Paragraph 27-2 of the Implementation Guidance on Accounting Standard

measure.
As a result, as of the beginning of the consolidated fiscal year under review, “Lease assets” included in tangible
fixed assets increased ¥138 million, “Lease obligations” in current liabilities increased ¥29 million, and “Leaseobligations” in long-term liabilities increased by ¥108 million. The impact of this change on the consolidated
income statement for the consolidated fiscal year under review is insignificant.
(Change in the calculation method of retirement benefit liabilities)
The Company absorbed Ahresty Pretech Corporation, a consolidated subsidiary of the Company, on April 1, 2022.
Accordingly, the calculation method for retirement benefit liabilities of Ahresty Pretech Corporation, the absorbed
company, was changed from the simplified method to the principle method. As a result, net defined benefit liability
as of the end of the consolidated fiscal year under review increased ¥448 million, and the same amount wasrecorded as retirement benefit expenses in extraordinary losses.
(Unapplied accounting standards, etc.)- “Accounting Standard for Current Income Taxes” (ASBJ Statement No. 27, October 28, 2022, AccountingStandards Board of Japan)- “Accounting Standard for Presentation of Comprehensive Income” (ASBJ Statement No. 25, October 28, 2022,
Accounting Standards Board of Japan)- “Guidance on Accounting Standard for Tax Effect Accounting” (ASBJ Guidance No. 28, October 28, 2022,
Accounting Standards Board of Japan)(1) Overview
ASBJ Statement No. 28 “Partial Amendments to Accounting Standard for Tax Effect Accounting,” etc.
(hereinafter, “ASBJ Statement No. 28, etc.”) was issued in February 2018 and the transfer of the JapaneseInstitute of Certified Public Accountants’ practical guidelines on tax effect accounting to the AccountingStandards Board of Japan was completed. In the course of deliberations on the transfer, however, the two
following issues were left to be discussed after the issuance of ASBJ Statement No. 28, etc. As the discussions
have been completed, these standards, etc. have been finally released.
- Classification for recording tax expenses (taxes on other comprehensive income)- Tax effect pertaining to sales of shares of subsidiaries, etc. (shares of subsidiaries or affiliates) when thegroup taxation regime is applied(2) Scheduled date of application
The application is scheduled from the beginning of the fiscal year ending March 2025.
(3) Impact of applying these accounting standards, etc.
The impact of applying “Accounting Standard for Current Income Taxes,” etc. on the consolidated financial
statements is currently under evaluation.
(Changes in presentation methods)(Notes on Consolidated Statements of Cash Flows)“Foreign currency exchange loss (gain),” which was included in “Others” under “Cash flows from operating
activities” in the previous consolidated fiscal year, was independently recorded starting from the consolidated
fiscal year under review because its importance in monetary value had increased. To reflect this change in themethod of presentation, reclassification of the financial statements of the previous fiscal year has been conducted.
As a result, (154 million yen) presented in “Others” under “Cash flows from operating activities” was reclassified
into 139 million yen for “Foreign currency exchange loss” and (293 million yen) for “Others.”

for Fair Value Measurement, Ahresty has decided to apply the new accounting policies set forth by the
Implementation Guidance on Accounting Standard for Fair Value Measurement in the future. This has no impact
on our Consolidated Financial Statements.
(Application of FASB Accounting Standards Codification (ASC) 842 “Leases”)
Since the beginning of the consolidated fiscal year under review, ASC 842 “Leases” has been applied to overseas
consolidated subsidiaries that have adopted US accounting standards. As a result, all leases of lessees at suchoverseas consolidated subsidiaries will be recognized on the balance sheet as assets or liabilities, in principle.
In applying the said accounting standards, we adopt the method of recognizing the cumulative effect of theapplication of the accounting standards on the day of the start of the application, as accepted as a transitional

67

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Ahresty Report 2023

Notes to Consolidated Financial Statements＊6. Breakdown of losses on the sale and disposal of fixed assets

Notes on Consolidated Balance Sheets＊1. T he amounts of the receivables and contract assets arising from contracts with customers included in “Tradenotes and accounts receivable, and contract assets” are as follows:
As of March 31, 2022

As of March 31, 2023

As of March 31, 2022

As of March 31, 2023

Building and structures¥20 million¥11 million

Machinery and delivery equipment¥169 million¥81 million

Notes receivable¥1,011

million¥603

millionTools, furniture and fixtures, others¥55 million¥121 million

Accounts receivable¥25,620

million¥26,526

millionTotal¥245 million¥214 million–

million¥11

million¥26,631

million¥27,140

millionContract assets
Total＊2. Figures related to unconsolidated subsidiaries and affiliates are as follows.
Investments in securities (share)

As of March 31, 2022

As of March 31, 2023

¥56 million¥56 million

As of March 31, 2022

As of March 31, 2023

＊3. Notes receivable transfer by endorsement
Notes receivable transfer by endorsement＊7. Impairment loss
The Group posted impairment losses for the asset groups below.
Previous consolidated fiscal year (from April 1, 2021 to March 31, 2022)(1)Assets for which an impairment loss was recognized
Location¥524 million

¥469

Use

millionAhresty Die Mold
Hamamatsu Corporation(Nishi-ku, Hamamatsu City,
Shizuoka)Notes on Consolidated Statements of Income＊1. Revenue from contracts with customers
	Regarding net sales, revenue from contracts with customers and other revenues are not presented separately.
The amount of revenue from contracts with customers is provided in “Notes (Segment Information, etc.) 3.
Information related to net sales, profits or losses, assets, liabilities and amounts for other items by reported
segment, and information on the breakdown of revenue.”＊2. A mount after write-down of year-end inventory to reflect the effect of lower profit margins. The write-down of
inventory shown below is included in cost of goods sold.

Ahresty Die Mold Tochigi
Corporation(Mibu-machi, Shimotsugagun, Tochigi)

Business assets

Business assets

Type

Impairment loss (millions of yen)

Buildings and structures

1

Machinery and delivery
equipment

125

Tools, furniture and fixtures

13

Land

204

Intangible fixed assets

7

Buildings and structures2

Machinery and delivery
equipment

10

Tools, furniture and fixtures

5

Intangible fixed assets

0

As of March 31, 2022

As of March 31, 2023

Buildings and structures

129¥389 million¥735 million

Machinery and delivery
equipment

2,414

Ahresty Wilmington
Corporation(Ohio, the United States)＊3. R esearch and development expenses included in the administrative expenses
As of March 31, 2022

As of March 31, 2023

¥556 million¥558 million

No research and development expenses were included in the manufacturing costs incurred for the current period.

Hefei Ahresty Casting Co., Ltd.
(Anhui Province, People’s
Republic of China)

Business assets

Tools, furniture and fixtures

127

Lease assets

Assets to be disposed of2

Construction in progress

1,121

Construction in progress

62

Total

4,228

＊4. Breakdown of gains on the sale and disposal of fixed assets(2) Grouping method
As of March 31, 2022

As of March 31, 2023

The Ahresty Group groups business assets by business unit for which revenues and expenditures are

Building and structures¥3 million¥22 million

Machinery and delivery equipment¥21 million¥44 million

Tools, furniture and fixtures¥10 million¥19 millionLand– million¥3,121 million

anticipated revenues could no longer be expected due to a fall in the utilization rate, the Company reduced

Total¥34 million¥3,208 million

their book value to a recoverable amount and posted the reductions as an impairment loss.

continuously monitored. Idle assets and assets to be disposed of, etc. are grouped for each asset.
(3) Background of how the Group came to recognize an impairment loss and the calculation
Background of how the Group came to recognize an impairment loss and the calculation
For some of the business assets of Ahresty Die Mold Hamamatsu Corporation, from which the initially

The recoverable amount was measured based on the net realizable value, and the net realizable value wasGain on sales of land for the consolidated fiscal year under review is mainly due to sale of the land of the Company’s
Higashimatsuyama Plant.
＊5. Subsidy income	Previous consolidated fiscal year (April 1, 2021 to March 31, 2022)
	Subsidy income refers mainly to the subsidies granted by the Chinese gover nment for capital investment.
Consolidated fiscal year under review (April 1, 2022 to March 31, 2023)
Subsidy income refers mainly to the subsidies granted by the Chinese gover nment for capital investment.

69

calculated by deducting the estimated amount of the disposal cost from the real estate appraisal value.
For some of the business assets of Ahresty Die Mold Tochigi Corporation, from which the initially anticipatedrevenues could no longer be expected due to a fall in the utilization rate, the Company reduced their bookvalue to a recoverable amount and posted the reductions as an impairment loss.
The recoverable amount was measured based on the net realizable value, and the net realizable value wascalculated by deducting the estimated amount of the disposal cost from the roadside land prices, etc.
For Ahresty W ilmington Corporation, an impairment test was conducted in accordance with the US accounting
standards because of its delay in ear nings recovery. As a result, the book value of the business assets it owns

70

Ahresty Report 2023

Notes to Consolidated Financial Statements

was written down to the recoverable amount and the reductions recorded as an impairment loss.

was written down to the recoverable amount and recorded as an impairment loss.

For the recoverable value, the net realizable value based on the real estate appraisal and the movable property

For the recoverable value, the net realizable value based on the real estate appraisal and the movable property

appraisal value was used.

appraisal value is used.

For Hefei Ahresty Casting Co., Ltd., it was decided to dispose of dies for trial production and dedicated

For some of the business assets of Thai Ahresty Die Co., Ltd., from which the initially anticipated revenues

equipment of die-casting products for which the planned mass production was suspended, the book value of

became no longer able to be expected due to a fall in the utilization rate, the Company reduced their bookthe said assets was written down to the recoverable amount, and the reduced amount was recorded as anvalue to a recoverable amount and posted the reductions as an impairment loss.

impairment loss.

For the recoverable value, the net realizable value based on the appraisal value announced by Thailand is used.

For the recoverable value, the net realizable value based on the estimated sale value was used.

Notes on Consolidated Statements of Comprehensive Income

Current consolidated fiscal year under review (from April 1, 2022 to March 31, 2023)＊ R ecycling and tax effect relating to other comprehensive income(1)Assets for which an impairment loss was recognized
Location
Ahresty Corporation
Tokai plant(Toyohashi City, Aichi)

Ahresty Corporation
Higashimatsuyama plant(Namegawa-machi, Hiki-gun,
Saitama)Ahresty Wilmington
Corporation(Ohio, the United States)

Thai Ahresty Die Co., Ltd.
(Ayutthaya Province, Thailand)

Use

Business assets

Business assets

Business assets

Business assets

Type

Impairment loss (million yen)

As of March 31, 2022

As of March 31, 2023¥(43) million¥(20) million

Valuation difference on available-for-sale securities:

Buildings and structures

266

Machinery and delivery
equipment

581

Tools, furniture and fixtures

62

Buildings and structures

20

Machinery and delivery
equipment

111

Tools, furniture and fixtures29

Construction in progress

9

Amount arising during fiscal year under review

Intangible fixed assets

1

Remeasurements of defined benefit plans, net of tax:

Buildings and structures

24

Amount for the current term

Machinery and delivery
equipment

853

Reclassification remeasurements¥93

Tools, furniture and fixtures

55

Before tax-effect adjustment¥(92) million

Lease assets

6

Tax-effectAmount arising during fiscal year under review
Recycling¥(2,304) million

Before tax effect adjustment¥(2,348) million

Tax effect¥751

Valuation difference on available-for-sale securities

Remeasurements of defined benefit plans, net of tax

Buildings and structures

28

Total other comprehensive income

Machinery and delivery
equipment

83

Tools, furniture and fixtures

9

Lease assets

2

Intangible fixed assets

3

For some of the business assets of Tokai plant, from which the initially anticipated revenues became no longer
able to be expected due to a fall in the utilization rate, the Company reduced their book value to a recoverable
amount and posted the reductions as an impairment loss.

¥(1,596) million¥(10) million¥4,611 million¥3,433 million¥(186) million¥(143) million

million¥94¥(48) million–¥(92) million¥2,921

million¥(48) million

million¥3,373

millionPrevious consolidated fiscal year (from April 1, 2021 to March 31, 2022)
1. Type and number of issued shares, and the type and number of shares of treasury stock
Number ofshares at end of
previous fiscal year

The Ahresty Group groups business assets by business unit for which revenues and expenditures arecontinuously monitored. Idle assets and assets to be disposed of, etc. are grouped for each asset.

millionNotes on Consolidated Statements of Changes in Net Assets(2) Grouping method(3) Background of how the Group came to recognize an impairment loss and the calculation

¥9

–

227

2,378

¥(20) million

millionForeign currency translation adjustment:

Construction in progress

Total

–

Increase in
number ofshares in fiscal year

Decrease in
number ofshares in fiscal year

Number ofshares atend of fiscal year

Issued shares
Common stock

26,076,717−−

26,076,717

Total

26,076,717−−

26,076,717

Treasury stock

For the recoverable value, the net realizable value based on the real estate appraisal and the movable property

Common stock (Notes 1. 2.)

410,044

6,008

165,357

250,695

appraisal value is used.

Total

410,044

6,008

165,357

250,695

Regarding the Higashimatsuyama plant of Ahresty Corporation, for assets to be disposed of, which have no
possibility of use in the future due to closure of the plant, and assets with no reasonable plans for use at the
moment, the Company reduced their book value to the recoverable amount and recorded the reductions as an
impairment loss.
The recoverable amount was measured based on the net realizable value, which was calculated using

Notes: 1. The increase of 6,008 common shares in treasury stock is due to the purchase of shares of less than a unit and the acquisition
free of charge of a part of common shares allocated in the restricted stock compensation plan.
2. The decrease of 165,357 common shares in treasury stock is due to the disposal of the Company’s own shares in the restricted
stock compensation plan and the exercise of stock options.

memorandum value because their conversion to other purpose or sale is difficult.
For Ahresty W ilmington Corporation, an impairment test was conducted in accordance with the US accounting
standards because of its delay in ear nings recovery. As a result, the book value of the business assets it owns

7172

Ahresty Report 2023

Notes to Consolidated Financial Statements

2. Share warrants and own share warrants
Number of shares underlying share warrants (number of share)

Type of shares
underlying
share warrants

End of previous
fiscal year

Increase during
fiscal year

Submitting
Share warrantscompany(parent company) as stock options

−

−

−

−

−

140

Total

−

−

−

−

−

140

Share
warrant typeClassification

Balance at
end of fiscal year
Decrease during
Number at
fiscal year
end of fiscal year (millions of yen)

3. Dividends(1)Dividend payments(Resolution)

Type of shares

Amount of dividend(millions of yen)

Source ofdividend

Dividend
per share (yen)Record date

Effective dateMeeting of theBoard of Directors
on May 18, 2021

Common share

128

Retainedearnings

5

March
31, 2021

June
2, 2021

Meeting of theBoard of Directors
Common shareon November 10, 2021

129

Retainedearnings

5

September
30, 2021

December
3, 2021(2)Dividends with a record date falling in the fiscal year under review and with an effective date belonging to thefollowing fiscal year
Resolution

Type of shares

Meeting of theBoard of Directors
on May 18,2022

Amount of dividend(millions of yen)

Source of dividend

Dividend per share(yen)

Record date

3. Dividends(1)Dividend payments(Resolution)

Type of shares

Amount of dividend(millions of yen)

Source ofdividend

Dividend
per share (yen)Record date

Effective dateMeeting of theBoard of Directors
on May 18, 2022

Common share

129

Retainedearnings

5

March
31, 2022

June
8, 2022

Meeting of theBoard of Directors
Common shareon November 14, 2022

129

Retainedearnings

5

September
30, 2022

December
5, 2022(2)Dividends with a record date falling in the fiscal year under review and with an effective date belonging to thefollowing fiscal year
(Resolution)

Type of shares

Amount of dividend(millions of yen)

Source ofdividend

Dividend
per share (yen)Record date

Effective dateMeeting of
the Board of Directors
on May 18, 2023

Common share

129

Retainedearnings

5

March
31, 2023

June
6, 2023

Notes on Consolidated Statements of Cash Flows

Effective date

＊ R elationship between the final balance of cash and cash equivalents and the account amounts listed in the
consolidated balance sheets

June 8,2022

Cash on hand and with banks¥9,356

million¥12,991

millionCash and cash equivalents¥9,356

million¥12,991

million

As of March 31, 2022

Common share

129

Retained earnings

5

March 31,2022

As of March 31, 2023

Consolidated fiscal year under review (from April 1, 2022 to March 31, 2023)

Notes on Lease Transactions

1. Type and number of issued shares, and the type and number of shares of treasury stock
Number ofshares at end of
previous fiscal year

Increase in
number ofshares in fiscal year

Decrease in
number ofshares in fiscal year

Number ofshares atend of fiscal year

The Company has omitted notes for lease transactions because the Company believes there is a bit significant
need in this report for such disclosure.

Issued shares
Common stock

26,076,717−−

26,076,717

Total

26,076,717−−

26,076,717

Treasury stock

Notes on Financial Instruments
1. Information about use of financial instruments(1) Policy on use of financial instruments

Common stock (Notes 1. 2.)

250,695

Total

65,130250,695

166,003

65,130149,822

166,003

149,822

Notes: 1. The increase of 65,130 common shares in treasury stock is due to the purchase of shares of less than a unit and the acquisition

T he Group raises necessary capital (mainly bank loans), in light of its capital investment plan.

It invests

temporarily surplus funds primarily in financial assets that are highly liquid and raises short-term working
capital by obtaining bank loans. The Group uses derivatives to guard against the following risks but does notengage in speculative transactions.
(2) Types of financial instruments and risks arising from these financial instruments

free of charge of a part of common shares allocated in the restricted stock compensation plan.
2. The decrease of 166,003 common shares in treasury stock is due to the disposal of the Company’s own shares in theT he Group is exposed to credit risk through its trade notes and accounts receivable from customers, in otherwords, its operating receivables. It is also exposed to foreign currency fluctuation risk through foreign currency

restricted stock compensation plan and the exercise of stock options.

denominated operating receivables that arise when conducting business overseas.

2. Share warrants and own share warrants
Type of shares
underlying
share warrants

Number of shares underlying share warrants (number of share)

Investments in securities are mostly the shares of companies that we have business relations with and that are

End of previous
fiscal year

Increase during
fiscal year

Trade notes and accounts payable, in other words, operating payables, and electronically recorded debt are

Submitting
Share warrantscompany(parent company) as stock options

−

−

−

−

−

121

Total

−

−

−

−

−

121

Share
warrant typeClassification

Balance at
end of fiscal year
Decrease during
Number at
fiscal year
end of fiscal year (millions of yen)subject to a risk of market price fluctuations.
mostly due within one year.

The Group is exposed to foreign currency fluctuation risk on certain foreign

currency denominated payables.
T he Group obtains loans mainly for the purpose of raising capital for capital investment. The Group is exposed
to interest rate risk on certain loans but uses derivative transactions to guard against this risk (interest rate
swap transactions).
T he derivatives used by the Group is interest rate swap transactions to guard against the risk of changes ininterest payments on loans.
F or further information on hedge accounting including our hedging methods and hedged transactions, hedging
policy and method for assessing hedge effectiveness, please refer to “(7) Hedge accounting” of “4. Summary of73

74

Ahresty Report 2023

Notes to Consolidated Financial Statements

Significant Accounting Policies” of “Notes to Consolidated Financial Statements.”(Million yen)

(3) System for managing risks arising from financial instruments

Previous consolidated fiscal year
(March 31, 2022)

Item(a) Managing credit risk
T he Group’s sales division periodically monitors the status of operating receivables from major customers
and manages due dates and outstanding balances for individual customers with the aim of early identification

Consolidated fiscal year under review(March 31, 2023)

Unlisted shares

55

Shares of non-consolidated subsidiaries

56

56

and mitigation of concer ns over recovery arising as a result of deterioration in financial position, etc.
3. Long-term loans		For the fair values of long-term loans payable at fixed interest rates, the total amount of the principal and interest is
discounted using a rate that is assumed to be applied when a similar loan is newly borrowed. For the fair values oflong-term loans payable at variable interest rates that are subject to the special treatment of interest rate swaps, thetotal amount of the principal and interest that were accounted for as a single item with the relevant interest rate swap
is discounted with a rate that is assumed to be applied when a new, similar loan is taken out.

T he Group understands that it has hardly any credit exposure on derivative transactions, as it deals onlywith financial institutions that have high ratings.
(b) Managing market risk
T he Group may use interest rate swap transactions to mitigate the risk of changes in interest payments on
its loans.
We review our investments in securities continuously, checking the market values of the securities and the

4. Derivative transactions
		 See “Notes on Derivative Transactions”.

financial situation of the issuers (business partners) regularly and taking market conditions and our relations
with business partners into account.
The division responsible for executing and managing derivative transactions engages in derivative

5. Schedule of repayment of long-term loans after the consolidated account closing datetransactions with the approval of the person with decision-making authority, in accordance with management

Previous consolidated fiscal year (March 31, 2022)

regulations which specify trading authority, trading limit and other trading procedure. The division reportsmonthly trading figures to the director with jurisdiction.
(c) Managing liquidity risk arising from fund procurement
T he division in charge prepares and updates a fund procurement plan in a timely manner based on reports
from each division and manages liquidity risk by means such as ensuring on-hand liquidity.
N o liquidity risk management is carried out in relation to domestic consolidated subsidiaries as they arelinked into a cash management system (CMS) and obtain loans via the parent company.

Within one
year

More than
one year,within two
years

More than
two years,
within threeyears

More than
three years,
within fouryears

More thanfour years,
within fiveyears

More than
five years(¥ millions)(¥ millions)(¥ millions)(¥ millions)(¥ millions)(¥ millions)Long-term loans

8,381

8,719

5,553

2,825

722

–

Total

8,381

8,719

5,553

2,825

722

–

Within one
year

More than
one year,within two
years

More than
two years,
within threeyears

More than
three years,
within fouryears

More thanfour years,
within fiveyears

More than
five years(¥ millions)(4) Supplementary explanation about fair value of financial instruments
Current consolidated fiscal year (March 31, 2023)

Since variables are taken into consideration when estimating fair value of financial instruments, fair value may
fluctuate due to the adoption of different assumptions, etc.
2. Fair value of financial instruments
C arrying amounts in the consolidated balance sheets, fair values and differences between carrying amounts andfair values are as follows.

(¥ millions)(¥ millions)(¥ millions)(¥ millions)(¥ millions)Long-term loans

10,600

7,222

4,425

2,117

555

–

Total

10,600

7,222

4,425

2,117

555

–

Previous consolidated fiscal year (March 31, 2022)

Investments in securities

Carrying amount in the
consolidated balance sheets(¥ millions)

Fair value(¥ millions)

1,219

1,219

Difference(¥ millions)T he fair value of financial instruments is categorized into the following three levels, in accordance with the–observability and importance of the inputs related to the fair value calculation.
Level 1 fair value: F air value calculated using the market price formed in an active market for the target asset or

Total assets

1,219

1,219

–

Long-term loans

26,203

26,185(17)

Total liabilities

26,203

26,185

(17)

–

–

–

Derivative transactions

3. Matters regarding the breakdown of financial instruments by each fair value levelliability for the fair value calculation
Level 2 fair value: F air value calculated using observable inputs related to the fair value calculation other thanthe Level 1 inputs
Level 3 fair value: F air value calculated using inputs related to the fair value calculation that cannot be observed
I n cases where multiple inputs which have a material effect on the calculation of the fair value are used, among

Current consolidated fiscal year (March 31, 2023)

the levels to which the respective inputs belong, the fair value is categorized at the level with the lowest priority

Carrying amount in the
consolidated balance sheets(¥ millions)

Fair value(¥ millions)

Investments in securities

1,198

1,198

–

Total assets

1,198

1,198

–

Long-term loans

24,92024,825(94)

Total liabilities

24,92024,825

(94)

–

–

–

Derivative transactionsin the fair value calculation.

Difference(¥ millions)( 1) Financial instruments that are recorded on the consolidated balance sheet at their fair value
Previous consolidated fiscal year (March 31, 2022)
Item

Notes : 1. “ Cash and time deposits” are omitted, as cash is recognized at its carrying amount and book value of time deposits
approximates their fair value because of their short-term maturity.
2. S hares that do not have a market value are not included in “Investment securities.” The amounts of said financial
instruments recorded on the consolidated balance sheet are as follows:

Fair value (million yen)
Level 1

Level 2

Level 3

Investment securities

1,219

–

–

Total
1,219

Total assets

1,219

–

–

1,219

Current consolidated fiscal year (March 31, 2023)
Item

Fair value (million yen)
Level 1

Level 2

Level 3

Investment securities

1,198

–

–

Total
1,198

Total assets

1,198

–

–

1,198



75

76

Ahresty Report 2023

Notes to Consolidated Financial Statements

Current consolidated fiscal year (March 31, 2023)(2) Financial instruments other than financial instruments that are recorded on the consolidatedTypebalance sheet at their fair value
Previous consolidated fiscal year (March 31, 2022)
Consolidatedbalance sheet amount isabove acquisition cost

Fair value (million yen)

Item

Level 1

Level 2

Level 3Total

Long-term loans–

26,185–26,185

Total liabilities–

26,185–26,185Acquisition Cost

Difference(¥ millions)(¥ millions)(¥ millions)

1. Share

1,165

359

806

2. Bonds−−−

3. Other−−−

Subtotal

1,165

359

806

Type

Current consolidated fiscal year (March 31, 2023)

Consolidated Balance Sheet Amount

Consolidated Balance Sheet Amount

Acquisition Cost

Difference(¥ millions)(¥ millions)(¥ millions)

Fair value (million yen)

Item

Level 1Long-term loans

Level 2–

Total liabilities

Level 324,825–24,825––Total

1. Share

32

63

(31)

24,825

2. Bonds−−−

3. Other−−−

Subtotal

32

63

(31)

1,198

423

775

Consolidatedbalance sheet amount isbelow acquisition cost

24,825Note : E xplanation of the valuation methods and inputs used in calculating fair value

Total

1. Investment securities
	Listed shares are valued using the market price. Because listed shares are traded on active markets, their fair value iscategorized as a level 1 fair value.
2. Long-term loans	
The fair value of long-term loans is calculated using the discounted cash flow method based on interest rates
considering the total amount of the sum of principal and interest, the remaining period of the concerned obligation, andthe credit risk for each obligation, and this is categorized as a level 2 fair value.

Note: Unlisted stocks (5 million yen on the consolidated balance sheet) are not included in the table above because they have no market
price and it is very difficult to determine their fair value.

4. Other marketable securities sold
Previous consolidated fiscal year (April 1, 2021 through March 31, 2022)(1) Stock

Sales amount(million yen)

Total gain on sales(million yen)

Total loss on sales(million yen)

3,020

2,304

−

(2) Bond

Notes on Marketable Securities
1. Marketable securities for trading
N/A

(i)

Gover nment bond, local gover nment bond, etc.

−

−

−

(ii)

Corporate bond

−

−

−

−

−

−

−

−

−

3,020

2,304

−

(iii) Other(3) Other

2. Securities held to maturity that have market value
N/A
3. Other securities that have market value

Total

Current consolidated fiscal year (April 1, 2022 through March 31, 2023)
Previous consolidated fiscal year (March 31, 2022)
Type

Consolidatedbalance sheet amount isabove acquisition cost

Acquisition Cost

Difference(¥ millions)(¥ millions)

Sales amount(million yen)

Total gain on sales(million yen)

Total loss on sales(million yen)

−

−

−

(¥ millions)(1) Stock

1. Share

1,183

353

830

(2) Bond

2. Bonds

−

−

−

(i)

Gover nment bond, local gover nment bond, etc.

−

−

−

3. Other

−

−

−

(ii)

Corporate bond

−

−

−

Subtotal

1,183

353

830

−

−

−

(3) Other

−

−

−

Total

−

−

−

Type

Consolidatedbalance sheet amount isbelow acquisition cost

Consolidated Balance Sheet Amount

Consolidated Balance Sheet Amount

Acquisition Cost

Difference(¥ millions)(¥ millions)(¥ millions)

1. Share

35

60

(24)

2. Bonds−−−

3. Other−−−

Subtotal

35

60

(24)

1,219

413

805

Total

Note: Unlisted stocks (5 million yen on the consolidated balance sheet) are not included in the table above because they have no market
price and it is very difficult to determine their fair value.

(iii) Other

Notes on Derivative Transactions
1. Derivative transactions to which hedge accounting is not applied(1) Currency-related transactions
Previous consolidated fiscal year (March 31, 2022)
N/A
Current consolidated fiscal year (March 31, 2023)
N/A(2) Interest rate
Previous consolidated fiscal year (March 31, 2022)
N/A
Current consolidated fiscal year (March 31, 2023)
N/A

77

78

Ahresty Report 2023

Notes to Consolidated Financial Statements

2. Derivative transactions to which hedge accounting is applied(4) Adjustment statement of the balance of retirement benefit liabilities and pension assets at the end of the current fiscal

Interest rate
Previous consolidated fiscal year (March 31, 2022)
N/A

year and net defined benefit liabilities and assets related to employees’ retirement benefits that are recorded on the
consolidated balance sheet(¥ millions)
Retirement benefit liabilities of thefunded pension
Pension assets

Current consolidated fiscal year (March 31, 2023)
N/A

Notes on Employees’ Retirement Benefits
1. Overview of retirement benefit scheme
The company and some of its consolidated subsidiaries have established an approved retirement annuity system,a termination allowance plan and defined contribution retirement benefit schemes as our defined benefit systems.
Some of its consolidated subsidiaries also adopt a simple method for calculating retirement benefit liabilities. The
retirement benefit liabilities of Ahresty Pretech Corporation, which the Company absorbed on April 1, 2022, werePrevious consolidated fiscal year
(March 31, 2022)

Retirement benefit liabilities of theunfunded pension
Net liabilities and assets recorded on the
consolidated balance sheet
Net defined benefit liability
Net defined benefit asset
Net liabilities and assets recorded on the
consolidated balance sheet

Current consolidated fiscal year
(March 31, 2023)

3,042

3,278

(2,573)(2,656)

469

622

2,184

2,683

2,654

3,305

2,918
(263)

3,305
−

2,654

3,305

conventionally calculated by the simplified method. However, in line with the integration of the retirement benefit
regulations after the merger, the calculation method was changed to the principle method from the end of theconsolidated fiscal year under review.

(¥ millions)

2. Defined benefit system(1) Adjustment statement of the balance of retirement benefit liabilities at the beginning and end of the current fiscal year
(excluding systems that adopt the simplified method described in (3))(¥ millions)
Balance of retirement benefit liabilities atthe beginning of the current fiscal year
Service cost(5) Retirement benefit expenses and their breakdown

Previous consolidated fiscal year
(From April 1, 2021 to March 31, 2022)

Current consolidated fiscal year
(From April 1, 2022 to March 31, 2023)

4,388

4,599

268

274

Actuarial difference

13
100

16
117

Retirement benefits payments

(284)

(163)

Past service cost incurred
Amount of increase due to change from
simplified method to principle method
OthersBalance of retirement benefit liabilities atthe end of the current fiscal year

107

−

−

720

Interest expenses

5

(1)

4,599

5,564

Previous consolidated fiscal year
(From April 1, 2021 to March 31, 2022)

Current consolidated fiscal year
(From April 1, 2022 to March 31, 2023)

Service cost

268

274

Interest expenses
Expected retur n on pension plan assets

13
(62)

16
(51)

Recognized actuarial difference

44

48

Recognized prior service cost
Retirement benefit expenses calculatedby the simple method
Amount of increase due to change from
simplified method to principle method
OthersRetirement benefit expenses related tothe defined benefit system

48

48

95

141

−

448

157

406

566

1,333

Note: “Others” refer to special retirement expenses, including financial compensation, premium retirement allowance, etc., paid on atemporary basis.

(6) Remeasurements of defined benefit plans
The details of the items (before tax effects) that have been recorded in the remeasurements of defined benefit plans are
as follows.

(2) Adjustment statement of the balance of pension assets at the beginning and end of the current fiscal year (excluding(¥ millions)systems that adopt the simplified method described in (3))(¥ millions)
Balance of pension assets at the
beginning of the current fiscal year
Expected retur n on pension plan assets

Previous consolidated fiscal year
(From April 1, 2021 to March 31, 2022)
2,433Actuarial difference
Contributions from the business owner
Retirement benefits payments
Balance of pension assets at the end of
the current fiscal year

Current consolidated fiscal year
(From April 1, 2022 to March 31, 2023)
2,573

62

47

22

(27)

204
(150)

201
(137)

2,573

2,656

adopted at the beginning and end of the current fiscal year

Retirement benefits payments
Amount of transfer due to change from
simplified method to principle method
OthersBalance of net defined benefit liability atthe end of the current fiscal year

79

Previous consolidated fiscal year
(From April 1, 2021 to March 31, 2022)

Current consolidated fiscal year
(From April 1, 2022 to March 31, 2023)
48

Actuarial difference

(33)

(97)

Total

(92)

(48)

(7) Remeasurements of defined benefit plans
The breakdown of items recorded in the remeasurements of defined benefit plans (before tax impact deduction) is asfollows:(¥ millions)(3) Adjustment statement of the balance of net defined benefit liability under the system whereby the simple method is(¥ millions)
Balance of net defined benefit liability atthe beginning of the current fiscal year
Retirement benefit expenses

Prior service cost

Previous consolidated fiscal year
(From April 1, 2021 to March 31, 2022)(59)

Previous consolidated fiscal year
(March 31, 2022)

Current consolidated fiscal year
(March 31, 2023)

Unrecognized prior service cost

(425)

(376)

Unrecognized actuarial difference

(130)

(227)

Total

(555)

(604)

Current consolidated fiscal year
(From April 1, 2022 to March 31, 2023)

656

628

97
(125)

90
(49)

−

(272)

0

−

628

397

80

Ahresty Report 2023

Notes to Consolidated Financial Statements

Notes on Stock Option(8) Matters related to pension assets(i) Main breakdown of pension assets
The ratio of the main categories against the total pension assets is as follows:
Previous consolidated fiscal year
(March 31, 2022)

Current consolidated fiscal year
(March 31, 2023)

Bonds

25%

8%

Shares35%

10%Insurance assets ( general account )

36%

45%

Others

4%

37%

Total

100%

100%

1. The amount and account of expenses related to stock options
N/A
2. Description and scale of stock options and changes(1) Description of stock options
2006 stock options

To determine the rate of the long-term expected return on pension plan assets, the current and expected allocation of

Number of stock options by share type (Note 1)

November 15, 2006
Directors of the Company: Five persons
Corporate auditors of the Company: Two persons
Common shares: 8,600 shares

pension assets and the current and expected future rate of long-term return from a variety of assets that constitute

Grant dateNovember 30, 2006

Vesting conditions

Losing the positions of director and corporate auditor of the Company

Target length of service

No condition has been set with respect to length service.

Period for exercising rights
Number of share warrants(warrants) (Note 2)Class and number of shares subject to share warrants(Note 2)
Amount to be paid for the exercise of share warrants(yen) (Note 2)Offer price and the amount of capitalization whenshares are issued by the exercise of share warrants(yen) (Notes 2, 3)
Conditions for the exercise of share warrants (Note 2)
Matters relating to the transfer of share warrants(Note 2)Matters relating to the delivery of share warrants
associated with organization restructuring actions(Note 2)

From December 1, 2006 To November 30, 2036

Date of resolution

Number of stock options by share type ( Note 1 )July 26, 2007
Directors of the Company: Four persons
Corporate auditors of the Company: Two persons
Common shares: 11,000 shares

Grant dateAugust 10, 2007

Vesting conditions

Losing the positions of director and corporate auditor of the Company

Target length of service

No condition has been set with respect to length service.

Period for exercising rights
Number of share warrants( warrants ) ( Note 2 )Class and number of shares subject to share warrants( Note 2 )Amount to be paid for the exercise of share warrants( yen ) ( Note 2 )Offer price and the amount of capitalization whenshares are issued by the exercise of share warrants( yen ) ( Notes 2, 3 )Conditions for the exercise of share warrants ( Note 2 )From August 11, 2007 To August 10, 2037

Matters relating to the transfer of share warrants( Note 2 )Matters relating to the delivery of share warrants
associated with organization restructuring actions( Note 2 )The approval of the Board of Directors is required for the transfer of share
warrants.

Position and number of persons granted stock options(ii) Method for establishing the rate of the long-term expected return on pension plan assets

pension assets have been taken into account.
(9) Matters related to the actuarial calculation basis
The main actuarial calculation basis
Previous consolidated fiscal year
(March 31, 2022)

Date of resolution

Current consolidated fiscal year
(March 31, 2023)

Discount rate

Primarily 0.2%

Primarily 0.2%

Expected rate of increase
Rate of long-term expected retur n on
pension plan assets

Primarily 3.4%

Primarily 3.3%

2.5%

2.5%

3. Defined contribution retirement benefit system
The required contribution amount of the company and some of the consolidated subsidiaries was ¥412 million
as the previous consolidated fiscal year and ¥420 million as the current consolidated fiscal year.

35
Common stock 3,500 shares
1 per share
Offer price 3,419
Amount of capitalization 1,710(Note 4)
The approval of the Board of Directors is required for the transfer of share
warrants.
(Note 5)2007 stock options
Position and number of persons granted stock options

81

51
Common stock 5,100 shares
1 per share
Offer price 2,220
Amount of capitalization 1,110( Note 4 )( Note 5 )82

Ahresty Report 2023

Notes to Consolidated Financial Statements

2011 stock options

2008 stock options
Date of resolution

Number of stock options by share type (Note 1)

July 25, 2008
Directors of the Company: Four persons
Corporate auditors of the Company: Two persons
Common shares: 24,000 shares

Number of stock options by share type (Note 1)

July 20, 2011
Directors of the Company: Four persons
Corporate auditors of the Company: Two persons
Common shares: 24,000 shares

Grant dateAugust 18, 2008

Grant dateAugust 8, 2011

Vesting conditions

Losing the positions of director and corporate auditor of the Company

Vesting conditions

Losing the positions of director and corporate auditor of the Company

Target length of service

No condition has been set with respect to length service.

Target length of service

No condition has been set with respect to length service.

Period for exercising rights
Number of share warrants(warrants) (Note 2)Class and number of shares subject to share warrants(Note 2)
Amount to be paid for the exercise of share warrants(yen) (Note 2)Offer price and the amount of capitalization whenshares are issued by the exercise of share warrants(yen) (Notes 2, 3)
Conditions for the exercise of share warrants (Note 2)
Matters relating to the transfer of share warrants(Note 2)Matters relating to the delivery of share warrants
associated with organization restructuring actions(Note 2)

From August 19, 2008 To August 18, 2038

Period for exercising rights
Number of share warrants(warrants) (Note 2)Class and number of shares subject to share warrants(Note 2)
Amount to be paid for the exercise of share warrants(yen) (Note 2)Offer price and the amount of capitalization whenshares are issued by the exercise of share warrants(yen) (Notes 2, 3)
Conditions for the exercise of share warrants (Note 2)
Matters relating to the transfer of share warrants(Note 2)Matters relating to the delivery of share warrants
associated with organization restructuring actions(Note 2)

From August 9, 2011 To August 8, 2041

Date of resolution

Date of resolution

Number of stock options by share type (Note 1)

July 24, 2009
Directors of the Company: Four persons
Corporate auditors of the Company: Two persons
Common shares: 24,000 shares

Number of stock options by share type (Note 1)

July 24, 2012
Directors of the Company: Four persons
Corporate auditors of the Company: Two persons
Common shares: 24,000 shares

Grant dateAugust 17, 2009

Grant dateAugust 8, 2012

Vesting conditions

Losing the positions of director and corporate auditor of the Company

Vesting conditions

Losing the positions of director and corporate auditor of the Company

Target length of service

No condition has been set with respect to length service.

Target length of service

No condition has been set with respect to length service.

Period for exercising rights
Number of share warrants(warrants) (Note 2)Class and number of shares subject to share warrants(Note 2)
Amount to be paid for the exercise of share warrants(yen) (Note 2)Offer price and the amount of capitalization whenshares are issued by the exercise of share warrants(yen) (Notes 2, 3)
Conditions for the exercise of share warrants (Note 2)
Matters relating to the transfer of share warrants(Note 2)Matters relating to the delivery of share warrants
associated with organization restructuring actions(Note 2)

From August 18, 2009 To August 17, 2039

Period for exercising rights
Number of share warrants(warrants) (Note 2)Class and number of shares subject to share warrants(Note 2)
Amount to be paid for the exercise of share warrants(yen) (Note 2)Offer price and the amount of capitalization whenshares are issued by the exercise of share warrants(yen) (Notes 2, 3)
Conditions for the exercise of share warrants (Note 2)
Matters relating to the transfer of share warrants(Note 2)Matters relating to the delivery of share warrants
associated with organization restructuring actions(Note 2)

From August 9, 2012 To August 8, 2042

Date of resolution

Date of resolution

Number of stock options by share type (Note 1)

July 12, 2010
Directors of the Company: Five persons
Corporate auditors of the Company: Two persons
Common shares: 24,000 shares

Number of stock options by share type (Note 1)

July 22, 2013
Directors of the Company: Four persons
Corporate auditors of the Company: Two persons
Common shares: 24,000 shares

Grant dateJuly 28, 2010

Grant dateAugust 9, 2013

Vesting conditions

Losing the positions of director and corporate auditor of the Company

Vesting conditions

Losing the positions of director and corporate auditor of the Company

Target length of service

No condition has been set with respect to length service.

Target length of service

No condition has been set with respect to length of service.

Period for exercising rights
Number of share warrants(warrants) (Note 2)Class and number of shares subject to share warrants(Note 2)
Amount to be paid for the exercise of share warrants(yen) (Note 2)Offer price and the amount of capitalization whenshares are issued by the exercise of share warrants(yen) (Notes 2, 3)
Conditions for the exercise of share warrants (Note 2)
Matters relating to the transfer of share warrants(Note 2)Matters relating to the delivery of share warrants
associated with organization restructuring actions(Note 2)

From July 29, 2010 To July 28, 2040

Period for exercising rights
Number of share warrants(warrants) (Note 2)Class and number of shares subject to share warrants(Note 2)
Amount to be paid for the exercise of share warrants(yen) (Note 2)Offer price and the amount of capitalization whenshares are issued by the exercise of share warrants(yen) (Notes 2, 3)
Conditions for the exercise of share warrants (Note 2)
Matters relating to the transfer of share warrants(Note 2)Matters relating to the delivery of share warrants
associated with organization restructuring actions(Note 2)

From August 10, 2013 to August 9, 2043

Date of resolution
Position and number of persons granted stock options

109
Common stock 10,900 shares
1 per share
Offer price 573
Amount of capitalization 287(Note 4)
The approval of the Board of Directors is required for the transfer of share
warrants.
(Note 5)

Position and number of persons granted stock options

89
Common stock 8,900 shares
1 per share
Offer price 410
Amount of capitalization 205(Note 4)
The approval of the Board of Directors is required for the transfer of share
warrants.
(Note 5)2012 stock options

2009 stock options
Position and number of persons granted stock options

98
Common stock 9,800 shares
1 per share
Offer price 370
Amount of capitalization 185(Note 4)
The approval of the Board of Directors is required for the transfer of share
warrants.
(Note 5)

Position and number of persons granted stock options

89
Common stock 8,900 shares
1 per share
Offer price 235
Amount of capitalization 118(Note 4)
The approval of the Board of Directors is required for the transfer of share
warrants.
(Note 5)2013 stock options

2010 stock options
Position and number of persons granted stock options

83

89
Common stock 8,900 shares
1 per share
Offer price 569
Amount of capitalization 285(Note 4)
The approval of the Board of Directors is required for the transfer of share
warrants.
(Note 5)

Position and number of persons granted stock options

94
Common stock 9,400 shares
1 per share
Offer price 583
Amount of capitalization 292(Note 4)
The approval of the Board of Directors is required for the transfer of share
warrants.
(Note 5)84

Ahresty Report 2023

Notes to Consolidated Financial Statements

2017 stock options

2014 stock options

Number of stock options by share type (Note 1)

July 28, 2014
Directors of the Company: Four persons
Corporate auditors of the Company: Two persons
Common shares: 48,600 shares

Number of stock options by share type (Note 1)

July 12, 2017
Directors of the Company: Seven persons (incl. One Director, who is Audit& Supervisory Committee member)
Common shares: 52,600 shares

Grant dateAugust 19, 2014

Grant dateAugust 10, 2017

Vesting conditions

Losing the positions of director and corporate auditor of the Company

Vesting conditions

Losing the positions of director of the Company

Target length of service

No condition has been set with respect to length of service.

Target length of service

No condition has been set with respect to length of service.

Period for exercising rights
Number of share warrants(warrants) (Note 2)Class and number of shares subject to share warrants(Note 2)
Amount to be paid for the exercise of share warrants(yen) (Note 2)Offer price and the amount of capitalization whenshares are issued by the exercise of share warrants(yen) (Notes 2, 3)
Conditions for the exercise of share warrants (Note 2)
Matters relating to the transfer of share warrants(Note 2)Matters relating to the delivery of share warrants
associated with organization restructuring actions(Note 2)

From August 20, 2014 to August 19, 2044

Period for exercising rights
Number of share warrants(warrants) (Note 2)Class and number of shares subject to share warrants(Note 2)
Amount to be paid for the exercise of share warrants(yen) (Note 2)Offer price and the amount of capitalization whenshares are issued by the exercise of share warrants(yen) (Notes 2, 3)
Conditions for the exercise of share warrants (Note 2)
Matters relating to the transfer of share warrants(Note 2)Matters relating to the delivery of share warrants
associated with organization restructuring actions(Note 2)

From August 11, 2017 to August 10, 2047

Date of resolution
Position and number of persons granted stock options

194
Common stock 19,400 shares
1 per share
Offer price 668
Amount of capitalization 334(Note 4)
The approval of the Board of Directors is required for the transfer of share
warrants.
(Note 5)2015 stock options
Date of resolution

Number of stock options by share type (Note 1)

July 24, 2015
Directors of the Company: Six persons (incl. One Director, who is Audit &Supervisory Committee member)
Common shares: 44,800 shares

Grant dateAugust 18, 2015

Vesting conditions

Losing the positions of director of the Company

Target length of service

No condition has been set with respect to length of service.

Period for exercising rights
Number of share warrants(warrants) (Note 2)Class and number of shares subject to share warrants(Note 2)
Amount to be paid for the exercise of share warrants(yen) (Note 2)Offer price and the amount of capitalization whenshares are issued by the exercise of share warrants(yen) (Notes 2, 3)
Conditions for the exercise of share warrants (Note 2)
Matters relating to the transfer of share warrants(Note 2)Matters relating to the delivery of share warrants
associated with organization restructuring actions(Note 2)

From August 19, 2015 to August 18, 2045

Date of resolution

Number of stock options by share type (Note 1)

July 25, 2016
Directors of the Company: Six persons (incl. One Director, who is Audit &Supervisory Committee member)
Common shares: 57,300 shares

Grant dateAugust 10, 2016

Vesting conditions

Losing the positions of director of the Company

Target length of service

No condition has been set with respect to length of service.

Period for exercising rights
Number of share warrants(warrants) (Note 2)Class and number of shares subject to share warrants(Note 2)
Amount to be paid for the exercise of share warrants(yen) (Note 2)Offer price and the amount of capitalization whenshares are issued by the exercise of share warrants(yen) (Notes 2, 3)
Conditions for the exercise of share warrants (Note 2)
Matters relating to the transfer of share warrants(Note 2)Matters relating to the delivery of share warrants
associated with organization restructuring actions(Note 2)

From August 11, 2016 to August 10, 2046

Position and number of persons granted stock options

223
Common stock 22,300 shares
1 per share
Offer price 768
Amount of capitalization 384(Note 6)
The approval of the Board of Directors is required for the transfer of share
warrants.
(Note 5)2016 stock options
Position and number of persons granted stock options

85

286
Common stock 28,600 shares
1 per share
Offer price 598
Amount of capitalization 299(Note 6)
The approval of the Board of Directors is required for the transfer of share
warrants.

Date of resolution
Position and number of persons granted stock options

386
Common stock 38,600 shares
1 per share
Offer price 660
Amount of capitalization 330(Note 6)
The approval of the Board of Directors is required for the transfer of share
warrants.
(Note 5)

Notes: 1. Converted to the number of shares
2. Information on the last day of the fiscal year under review (March 31, 2023) is stated. Because there is no change in theinformation to be stated as of the end of the previous month (May 31, 2023), which is the date of submission, from theinformation on the last day of the fiscal year under review, the description of information as of the end of the previous month,
the date of submission, is omitted.
3. (1) The amount of stated capital to increase in cases where shares are issued by the exercise of share warrants shall be half ofthe maximum amount of increase in stated capital that is calculated in accordance with Article 17, Paragraph 1 of the Rulesof Corporate Accounting, and fractions less than one yen arising from the calculation shall be rounded up.
(2) The amount of capital reserves to increase in cases where shares are issued by the exercise of share warrants shall be an
amount obtained by reducing the amount of stated capital to increase provided for in (1) above from the maximum amountof increase in stated capital stated in (1) above.
4. (1) Share warrant holders may exercise share warrants only during the period from the day following the day when they haverelinquished their position both as a director and a corporate auditor of the Company (hereinafter referred to as the “Exercise
Commencement Date”) to the day when 10 days have passed after the Exercise Commencement Date within the exercise
period.
(2) Notwithstanding the statement in (1) above, the share warrant holders may exercise share warrants only during the period
stipulated in ① or ② below in the case provided for in ① or ② (however, for ②, excluding cases where share warrants ofthe stock company listed in (a) through (e) in Article 236, Paragraph 1, (viii) of the Companies Act are issued).
① If the Exercise Commencement Date does not arrive before a year before the last day of the exercise period arrives, froma year before the last day of the exercise period to the last day of the exercise period② If a proposal to approve a merger agreement by which the Company will become a disappearing company or a proposal
to approve a share exchange agreement or a share transfer plan by which the Company will become a wholly owned
subsidiary is approved at a general meeting of shareholders of the Company (if a resolution is made by the Board of
Directors of the Company in cases where the resolution of the general meeting of shareholders is unnecessary), for 15
days from the day following the date of approval(3) The share warrant holders shall exercise all share warrants in a lump.
(4) If a share warrant holder has abandoned share warrants, he/she may not exercise such share warrants.
(5) Other conditions shall be established by a share warrant allotment agreement to be concluded between the Company andthe share warrant holders based on a resolution of the Board of Directors.
5. Treatment when organization restructuring actions are taken
In cases where the Company conducts a merger (limited to cases where the Company will disappear as a result of the merger),an absorption-type company split, an incorporation-type company split, a share exchange or a share transfer (hereinaftercollectively referred to as “Organization Restructuring Actions”), the Company shall deliver share warrants of the stock company
listed in (a) through (e) in Article 236, Paragraph 1, (viii) of the Companies Act (hereinafter referred to as the “Company Subject
to Reorganization”) to the share warrant holders of the share warrants that remain when the Organization Restructuring Actions
become effective (hereinafter referred to as the “Remaining Share Warrants”) for each case. In this case, the Remaining Share
Warrants shall disappear, and the Company Subject to Reorganization shall issue new share warrants. However, this shall belimited to cases where a provision to the effect that the share warrants of the Company Subject to Reorganization shall bedelivered in accordance with the conditions below is set forth in the absorption-type merger agreement, the consolidation-typemerger agreement, the absorption-type company split agreement, the incorporation-type company split agreement, the shareexchange agreement or the share transfer plan.
(1) Number of share warrants of the Company Subject to Reorganization to be delivered
The same number as the number of share warrants held by the share warrant holders of the Remaining Share Warrants shallbe delivered in each case.
(2) Class of shares of the Company Subject to Reorganization subject to share warrants
Common stock of the Company Subject to Reorganization(3) Number of shares of the Company Subject to Reorganization subject to share warrants
It will be determined by taking into consideration the conditions, etc. of the Organization Restructuring Actions.
(4) Value of property to be contributed upon the exercise of share warrants
The value of property to be contributed upon the exercise of each share warrant to be delivered shall be an amount obtained(Note 5)86

Ahresty Report 2023

Notes to Consolidated Financial Statements

by multiplying the amount to be paid after reorganization that is set forth below by the number of shares of the Company
Subject to Reorganization subject to the each share warrant to be determined in accordance with (3) above. The amount tobe paid after reorganization shall be 1 yen per share of the Company Subject to Reorganization that can be delivered upon
the exercise of each share warrant to be delivered.
(5) Period when share warrants can be exercised
The period when share warrants can be exercised shall be from the date of commencement of the period when share
warrants for subscription can be exercised, or the effective date of the Organization Restructuring Actions, whichever comes
later, to the expiration date of the period when share warrants for subscription can be exercised.
(6) Matters relating to stated capital and capital reserves to increase in cases where shares are issued by the exercise of share
warrants①The amount of stated capital to increase in cases where shares are issued by the exercise of share warrants forsubscription shall be half of the maximum amount of increase in stated capital that is calculated in accordance with Article
17, Paragraph 1 of the Rules of Corporate Accounting, and fractions less than one yen arising from the calculation shallbe rounded up.
②The amount of capital reserves to increase in cases where shares are issued by the exercise of share warrants forsubscription shall be an amount obtained by reducing the amount of stated capital to increase provided for in (1) abovefrom the maximum amount of increase in stated capital stated in (1) above.
(7) Restrictions on the acquisition of share warrants by transfer
The acquisition of share warrants by transfer shall require the approval by the resolution of the Board of Director of theCompany Subject to Reorganization.
6. (1) Share warrant holders may exercise share warrants only during the period from the day following the day when they haverelinquished their position as a director of the Company (hereinafter referred to as the “Exercise Commencement Date”) to
the day when 10 days have passed after the Exercise Commencement Date within the exercise period.
(2) Same as (2) in (Note 4) above.
(3) Same as (3) in (Note 4) above.
(4) Same as (4) in (Note 4) above.
(5) Same as (5) in (Note 4) above.

(2) Scale of stock options and changes
S tock options existed in the fiscal year under review (ended March 31, 2023). The number of stock options isconverted to the number of shares.

Previous consolidated fiscal year

Current consolidated fiscal year

(March 31, 2022) (¥ millions)(March 31, 2023) (¥ millions)Deferred tax assets
Accrued expenses

61

69

Net defined benefit liability
Accounts payable – other (amount that has not been transferred todefined contribution pension plan)Long-term accounts payable – other (amount that has not beentransferred to defined contribution pension plan)
Excess deductible amount in bonus allowances

691

802

7

11

41

23

373

394

Unrealized profits for inventories

83

144

Unrealized profits for fixed assets

854

702

Loss carried forward (Note 2)

4,546

5,063

Over-depreciation

2,888

3,452

Provision for product warranties
Impairment loss

20

33

1,633

2,331

Foreign tax credit carried forward

376

537

Other

987

1,345

12,566

14,910

Deferred tax assets subtotal
Valuation reserve pertaining to tax loss carried forward (Note 2)
Valuation reserve pertaining to the sum of deductible temporary
differences
Subtotal of valuation reserves (Note 1)(4,095)(4,649)(4,686)(5,041)(8,781)(9,690)

3,784

5,219

Property replacement reserve

(763)

(691)

Special depreciation reserve

(41)

(29)

Fixed assets reserve

(734)

(860)

Net unrealized gains on securities
Exchange rate differences on non-monetary assets and liabilities ofoverseas consolidated subsidiaries
Retained earnings of overseas consolidated subsidiaries

(246)

(236)

Deferred tax liabilities
2006
stock
options

2007
stock
options

2008
stock
options2009
stock
options

2010
stock
options

2011
stock
options2012
stock
options2013
stock
options

2014
stock
options

2015
stock
options

2016
stock
options2017
stock
options

Before vesting date(number of share)
9,800

8,900

8,900

8,900

Granted

−

−

−

−

−

−

−

Expired

−

−

−

−

−

−

−

−

−

−

−

−

Vested

−

−

−

−

−

−

−

3,000

6,200

5,400

6,900

6,300

5,100 10,900

9,800

8,900

8,900

8,900

Not yet vested

1. Breakdown of major causes for deferred tax assets and liabilities

Deferred tax assets totala. Number of stock options

At end of previous fiscal year

Notes on Tax Accounting

3,500

3,500

5,100 10,900

12,400 25,600−

27,700 35,500 44,900

−

−

−

−

9,400 19,400 22,300 28,600 38,600

After vesting date (number of share)
At end of previous fiscal year

−

−

−

−

−

−

−

−

−

−

−

−

Vested

−

−

−

−

−

−

−

3,000

6,200

5,400

6,900

6,300

Exercise of rights

−

−

−

−

−

−

−

3,000

6,200

5,400

6,900

6,300

Expired

−

−

−

−

−

−

−

−

−

−

−

−

Unexercised

−

−

−

−

−

−

−

−

−

−

−

−

Other
Deferred tax liabilities total
Net deferred tax assets(1,118)(1,895)(938)(1,034)

(541)

(367)

(4,383)(5,117)

(598)

102

Notes: 1. The amount of valuation allowance increased by 909 million yen from the end of the previous consolidated
fiscal year. This increase was attributable primarily to an increase in losses carried forward for taxation
purpose at the Company and its consolidated subsidiaries and an increase in the amount of valuation
allowance related to deductible temporary difference associated with impairment losses.
2. Amounts of tax loss carried forward and deferred tax assets by the deadline for carrying forward
Previous consolidated fiscal year (March 31, 2022)

b. Unit price information
2006
stock
options

2007
stock
options

2008
stock
options2009
stock
options

2010
stock
options

2011
stock
options2012
stock
options2013
stock
options

2014
stock
options

2015
stock
options

2016
stock
options2017
stock
options

Exercise price (yen)

1

1

1

1

1

1

1

1

1

1

1

1

Average stock price at timeof exercise (yen)

−

−

−

−

−

−

−

368

368

368

368

368

3,418

2,219

572

369

568

409

234

582

667

767

597

659

Fair unit value on grant date (yen)Up to 1 year
(million yen)More than 1
year and up
to 2 years(million yen)More than 2
years and up
to 3 years(million yen)More than 3
years and up
to 4 years(million yen)More than 4
years and up
to 5 years(million yen)More than 5
years(million yen)Total
(million yen)(*2) 4,546

Tax loss carried forward (*1)

2

79

267

58

121

4,017

Valuation reserve

(2)

(39)

(22)

(4)

(8)

(4,017)(4,095)

Deferred tax assets

−

39

244

54

112

−

(*2) 450(*1) The tax loss carried forward is an amount obtained by multiplying the effective statutory tax rate.
3. Method for estimating the fair unit value of stock options
There were no new stock options granted in the current consolidated fiscal year.

(*2) For the tax loss carried forward of ¥4,546 million (an amount obtained by multiplying the effective statutory tax rate),
deferred tax assets of ¥450 million are posted. For this tax loss carried forward, valuation reserve is not recognized
for the portion that is determined to be recoverable based on the expected future taxable income, etc.

4. Method for estimating the number of vested stock options
S ince it is inherently difficult to estimate the number of stock options expected to expire, only the actual numberof stock options that have expired is reflected.

8788

Ahresty Report 2023

Notes to Consolidated Financial Statements(Notes on business combination)

Consolidated fiscal year under review (March 31, 2023)(Transactions under common control, etc.)
Up to 1 year
(million yen)More than 1
year and up
to 2 years(million yen)More than 2
years and up
to 3 years(million yen)More than 3
years and up
to 4 years(million yen)More than 4
years and up
to 5 years(million yen)More than 5
years(million yen)Total
(million yen)

The Company absorbed Ahresty Pretech Corporation, a wholly owned subsidiary of the Company, on April 1, 2022 as

Tax loss carried forward (*1)

−

141

54

122

153

4,590

(*2) 5,063(1) Outline of the transaction

Valuation reserve

−

(1)

(14)

(4)

(37)

(4,590)(4,649)Deferred tax assets

−

139

39

117

116

−

(*2) 413(Absorption of a consolidated subsidiary)
resolved at its Board of Directors’ meeting held on December 24, 2021.
(i) Name of the constituent enterprise and its business line
Name of the constituent enterprise: Ahresty Pretech Corporation
Business line: Machining and assembly of die-cast products(*1) The tax loss carried forward is an amount obtained by multiplying the effective statutory tax rate.
(*2) For the tax loss carried forward of ¥5,063 million (an amount obtained by multiplying the effective statutory tax rate),
deferred tax assets of ¥413 million are posted. For this tax loss carried forward, valuation reserve is not recognized
for the portion that is determined to be recoverable based on the expected future taxable income, etc.

(ii) Date of business combination: April 1, 2022(iii) Legal form of business combination
Absorption-type merger with the Company as the surviving company and Ahresty Pretech Corporation as
the absorbed company(iv) Name of the enterprise after business combination(Changes in presentation methods)“Foreign tax credit carried forward,” which was included in “Others” under “Deferred tax assets,” and “Retained earningsof overseas consolidated subsidiaries,” which was included in “Others” under “Deferred tax liabilities” in the previous
consolidated fiscal year, were independently recorded starting from the consolidated fiscal year under review because theirimportance in monetary value had increased. To reflect this change in the method of presentation, reclassification of Notesof the previous fiscal year has been conducted.
As a result, 1,363 million yen presented in “Others” under “Deferred tax assets” in Notes in the previous consolidated fiscal
year was reclassified into 376 million yen for “Foreign tax credit carried forward” and 987 million yen for “Others,” and(1,479 million yen) presented in “Others” under “Deferred tax liabilities” was reclassified into (938 million yen) for “Retained
earnings of overseas consolidated subsidiaries” and (541 million yen) for “Others.”

Ahresty Corporation(v) Other matters related to the outline of the transaction
The purpose of this absorption was to establish an integrated casting and processing system at theCompany’s Tokai Plant through this organizational restructuring, achieve further cost reduction andimproved productivity by integrating management operations and sharing know-how, and realize efficient
operation of the organization with concentrated management resources.
(2) Outline of accounting treatment implemented
Based on “Accounting Standard for Business Combinations” (ASBJ Statement No. 21, January 16, 2019) and“Implementation Guidance on Accounting Standard for Business Combinations and Accounting Standard for

2. B reakdown by item of major causes for important differences between the burden rates of corporate tax at thestatutory effective tax rate and after the application of deferred tax accounting
Previous consolidated fiscal year Current consolidated fiscal year

Business Divestitures” (ASBJ Guidance No. 10, January 16, 2019), it was treated as a transaction undercommon control.
(Absorption of two second-tier subsidiaries by a consolidated subsidiary)(March 31, 2022) (%)(March 31, 2023) (%)

30.6

30.6

(1.1)

246.6

resolved at the Board of Directors’ meeting held on October 29, 2021.

Items that will never be included as profits, such as dividend revenue

0.2(11.2)(1) Outline of the transaction

Per capita residential tax

(0.7)

100.8

Increase (decrease) in valuation allowance(45.8)

71.6

Name of the constituent enterprise: Ahresty Die Mold Tochigi Corporation and Ahresty Die Mold Kumamoto

Difference in statutory tax rates of consolidated subsidiaries(10.2)

801.7

Corporation

Deduction on overseas consolidated subsidiaries

0.0

11.4

Retained earnings of overseas consolidated subsidiaries

(3.0)

396.8

Foreign tax credit
Impact of exchange rate fluctuations at overseas consolidated
subsidiaries
Other

1.7

(292.6)(3.4)(910.6)This was an absorption-type merger with Ahresty Die Mold Hamamatsu Corporation as the surviving

0.9

1.1

company, and Ahresty Die Mold Tochigi and Ahresty Die Mold Kumamoto as the absorbed companies. For

Burden ratio of corporate tax after application of deferred tax accounting(30.8)

446.2

Statutory effective tax rate
(adjustments)
Items that will never be included as losses, such as entertainment expenses

Ahresty Die Mold Hamamatsu Corporation, a consolidated subsidiary of Ahresty Corporation, absorbed its wholly-owned
subsidiaries Ahresty Die Mold Tochigi Corporation and Ahresty Die Mold Kumamoto Corporation on April 1, 2022, as(i) Name of the constituent enterprise and its business line

Business line: Manufacturing of die-casting dies(ii) Date of business combination: April 1, 2022(iii) Legal form of business combination

this merger, Ahresty Die Mold Hamamatsu Corporation followed the procedure of a simplified merger
pursuant to the provision of Article 796 (2) of the Companies Act and Ahresty Die Mold Tochigi Corporation(Changes in presentation methods)

and Ahresty Die Mold Kumamoto Corporation followed the procedure of a short-form merger pursuant to the“Deduction on overseas consolidated subsidiaries,” which was included in “Others” in the previous consolidated fiscal

provision of Article 784 (1) of the Companies Act, thus both without obtaining approval at the shareholders’year, was independently recorded starting from the consolidated fiscal year under review because its importance inmonetary value had increased. To reflect this change in the method of presentation, reclassification of the items of theprevious fiscal year has been conducted.
As a result, “Deduction on overseas consolidated subsidiaries” was reclassified as 0.0 in Notes of the previous consolidated
fiscal year.

meeting.
(iv) Name of the enterprise after business combination
Ahresty Die Mold Hamamatsu Corporation(v) Other matters related to the outline of the transaction
Ahresty decided to merge one of its consolidated subsidiaries and two second-tier subsidiaries in Japan toenhance competitiveness and improve the management efficiency of the Group. The purpose of this merger

3. A ccounting treatment for national and local corporate income taxes or accounting treatment for tax effectis to integrate our die-casting mold manufacturing operations in Japan into one site and thereby enhanceaccounting related thereto

our competitiveness in die manufacturing in Japan and improve management efficiency, and to eventually

Since the beginning of the consolidated fiscal year under review, the group tax sharing system has been applied to theimprove the corporate value of the entire Ahresty Group.

Company and its domestic consolidated subsidiaries. In addition, the accounting treatment and disclosure of accounting
treatment for national and local corporate income taxes or accounting treatment for tax effect accounting related
thereto are performed in accordance with the “Practical Solution on the Accounting and Disclosure Under the Group Tax
Sharing System” (ASBJ Practical Solution No. 42, August 12, 2021).

8990

Ahresty Report 2023

Notes to Consolidated Financial Statements

Current consolidated fiscal year (April 1, 2022 through March 31, 2023)(2) Outline of accounting treatment implemented(Millions of yen)

Based on “Accounting Standard for Business Combinations” (ASBJ Statement No. 21, January 16, 2019) and
Reported segments“Implementation Guidance on Accounting Standard for Business Combinations and Accounting Standard for Business

Die Casting Business

Divestitures” (ASBJ Guidance No. 10, January 16, 2019), it was treated as a transaction under common control.

Japan

North America

Aluminum
Business

Asia

Proprietary Products
Business

Total

Sales

(Notes on Asset Retirement Obligations)
The Company has omitted notes for asset retirement obligations because the Company believes there is a bit significant
need in this report for such disclosure.
(Notes on Rental Properties)
The Company has omitted notes for rental properties because the Company believes there is a bit significant need inthis report for such disclosure.

Revenue from contracts withcustomers(1) Customers

59,01936,99533,676

7,975

3,271

140,938

59,01936,99533,676

7,975

3,271

140,938(2) Intersegment

3,015

15

2,362

1,568

56

7,017

Total

37,010(676)

36,039
8

9,544

3,327

Segment profits/loss

62,034
250

274

285

147,956
143

Segment assets

50,832

31,59742,163

4,085

3,271

131,950

Depreciation and amortization

4,208

4,361

4,359

56

3

12,990

Impairment loss

1,091

1,174

127

−

−

2,393

Increase in tangible fixed assets
and intangible fixed assets

3,819

3,020

3,541

36

0

10,418Other items

Segment Information
1. Overview of reported segments
The reported segments of the Company are those units for which separate financial information can be obtained among
the constituent units of the Company and for which the Board of Directors of the Company regularly carries out

4. Total amount in reported segments, difference from the amount posted in consolidated financial statement
and important details in the difference (Difference adjustment)

examinations to determine the allocation of management resources and assess the business performance.
The Company manages the Die Casting Business, the Aluminum Business, and the Proprietary Products Business.
In the Die Casting Business, the Company develops comprehensive strategies by regions: Japan, North America, andAsia, and is engaged in business activities accordingly.
As a result, the Company has five reported segments: Die Casting Business: Japan, Die Casting Business: North
America, Die Casting Business: Asia, Aluminum Business, and Proprietary Products Business.
In the Die Casting Business, the Company is mainly engaged in manufacturing and sales of auto parts, general engine
parts, industrial machinery parts, and dies in Japan, North America and Asia. In the Aluminum Business, the Company
is engaged in smelting and sales of aluminum alloy ingots. In the Proprietary Products Business, it sells access floors
and its accessories.
2. Methods for calculating net sales, profits or losses, assets, liabilities and amounts for other items by reported
segment
Profits in the reported segments are figures based on operating income.
Intersegment sales and transfers are based on current market values.

Previous consolidated
fiscal year

Net sales
Total sales inreported segments
Elimination ofintersegment transactions
Net sales in the
consolidated
financial statement

Total assets inreported segments
Elimination ofintersegment transactions
Company-wide
assetsAssets in the consolidated
financial statement

Other items

Previous consolidated fiscal year (April 1, 2021 through March 31, 2022)(Millions of yen)
Reported segments
Die Casting BusinessJapan

North America

Aluminum
Business

Asia

Proprietary Products
Business

Total

147,956(6,015)(7,017)116,313140,938

Previous consolidated
fiscal year

ProfitTotal profit inreported segments
Elimination ofintersegment transactions
Operating income /loss in the consolidated
financial statement(Millions of yen)
Current consolidated
fiscal year

(2,436)

143

14

(120)

(2,422)

23(Millions of yen)
Current consolidated
fiscal year

131,834

131,950(6,820)(3,923)

6,288

9,042

131,302

137,069(Millions of yen)
Total amount in
Amount recorded in consolidated
Adjustment
reported segments
financial statements
Previous consolidated Current consolidated Previous consolidated Current consolidated Previous consolidated Current consolidated
fiscal year
fiscal year
fiscal year
fiscal year
fiscal year
fiscal year

3. Information related to net sales, profits or losses, assets, liabilities and amounts for other items by reported
segment

122,328

Previous consolidated
fiscal year

Assets(Millions of yen)
Current consolidated
fiscal year

Depreciation andamortization
Impairment loss
Increase in tangible
fixed assets andintangible fixed assets

12,02912,990

(109)

(84)

11,91912,906

4,228

2,393

−

(14)

4,228

2,378

9,171

10,418

(78)

(47)

9,093

10,370

Sales
Revenue from contracts withcustomers(1) Customers

51,746

28,111

26,488

6,463

3,503

116,31351,746

28,111

26,488

6,463

3,503

116,313(2) Intersegment

2,429

5

1,524

2,035

20

6,015

Total

28,117(1,096)28,012
(547)

8,498

3,524

Segment profits/loss

54,175(1,372)

265

312

122,328(2,436)

Segment assets

51,71731,064

42,128

4,350

2,573

131,834

4,145

4,063

3,766

51

1

12,029

371

3,794

62

−

−

4,228

3,169

2,870

3,072

54

3

9,171

Other items
Depreciation and amortization
Impairment loss
Increase in tangible fixed assets
and intangible fixed assets

Related Information
Consolidated fiscal year under review (from April 1, 2022 to March 31, 2023)
1. Information by products and services
The statement is omitted because the same information is presented in segment information.
2. Information by regions(1) Sales(Millions of yen)Japan

North America
70,00137,095Asia

Other regions
33,709Total
132

140,938

Notes: 1. Sales are presented in categories by countries or regions based on the addresses of customers
2. Net sales in North America and Asia include net sales of ¥18,984 million in the United States that make up 10% or more of
net sales on the consolidated income statement, net sales of ¥18,110 million in Mexico and net sales of ¥28,105 million in
China.

91

92

Ahresty Report 2023

Notes to Consolidated Financial Statements

returns, the Company shall set total acquisition price to enable flexible acquisition of its own shares while comprehensively(2) Tangible fixed assets
Japan

North America
24,513Asia

18,113(Millions of yen)considering factors such as investment opportunities, financial conditions, stock price, etc.

Total

The Company shall utilize the shares acquired through this transition by allotting them as restricted stocks issued through27,276

69,903stock compensation policy to suppress stock dilution.

(Note) Tangible fixed assets in North America and Asia includes tangible fixed assets of ¥12,525 million in Mexico that makes up 10%
or more of tangible fixed assets on the consolidated balance sheet, tangible fixed assets of ¥22,871 million in China.

3. Information by major customers( Millions of yen )Name of customer

Sales

Subaru Corporation

Titles of the related segments
15,580

Die casting business: Japan

2. Details of the acquisition(1) Class of shares to acquire

The Company’s common stock(2) Total number shares to acquire

900,000 shares (maximum)(3) Total acquisition price of shares

500 million yen (maximum)(4) Acquisition period

May 19, 2023 to December 31, 2023

(Disposition of treasury shares as stock compensation)
At its meeting held on June 22, 2023, the Board of Directors of the Company passed a resolution on the disposition of[Related Party Information]

treasury shares (hereinafter the “Disposition of Treasury Shares”) as stock compensation as follows.

Transactions between the company submitting consolidated financial statements and related parties
Officers and major shareholders (limited to individuals) of the company submitting consolidated financial statements

1. Overview of the disposition(1) Date of disposition

Consolidated fiscal year under review (from April 1, 2022 to March 31, 2023)
Type

Officer

Name

Capital orBusiness orinvestments
occupation(million yen)

Arata
Takahashi−

Chairmanand CEO ofthe
Company

Ownership Relationshipof votingwith therightsinterested(owned) (%)
party(owned)Direct 4.1

Amount oftransaction(million yen)Transaction
In-kindcontribution ofmonetary
compensation
claim

−

July 14, 2023

(2) Class and number of shares to be disposed of

Item

Endingbalance(million yen)

(3) Disposition price

85,015 shares of the Company’s common stock¥693 per share(4) Total amount of disposition¥58 million(5) Persons subject to allotment and number thereof and number of shares to be allotted
Directors (excluding directors who are Audit and Supervisory Committee members):

16

−

−

Four persons; 70,747 shares
Directors who are Audit and Supervisory Committee members (excluding independent directors):
One person; 3,448 shares(Note) The in-kind contribution of monetary compensation claim is based on the restricted stock compensation plan (transfer restriction

Executive officers: Five persons; 10,820 shares(6) Other

period: 2 year).

N/A

Per Share Information

2. Purpose and reason for the disposition
At its meeting held on May 30, 2018, the Board of Directors of the Company resolved to introduce a restricted stock
Previous consolidated fiscal year

Current consolidated fiscal year

compensation plan (hereinafter the “Plan”) as a new compensation plan for the directors (excluding independent directors,(From April 1, 2021 to March 31, 2022)(From April 1, 2022 to March 31, 2023)

hereinafter the “Target Directors”) and executive officers of the Company for the purpose of providing them with an

Net assets per share

2,068.69

yen

2,180.28 yen

Net income or loss per share(201.23) yen(3.26) yen

Diluted net income per share––

Notes: 1. For fully diluted net income per share, no figure is recorded as it is a net loss per share, although latent shares

incentive to work on the sustainable enhancement of the Company’s corporate value, further promoting the sharing ofvalue with shareholders, and further increasing the linkage with medium- to long-term performance targets.
At its meeting held on June 22, 2023, the Board of Directors of the Company passed the following resolution: Based on
the plan, the Company will provide a monetary compensation claim to the Target Directors and executive officers, and theTarget Directors and executive officers will pay all of the monetary compensation claims as in-kind contributions. The

exist.

Company will then subscribe for its common shares to be allotted with the Disposition of Treasury Shares.

2. The following shows the basis of calculation of net loss per share.

3. Overview of the Plan
Previous consolidated fiscal year

Current consolidated fiscal year

The Target Directors and executive officers will pay all of the monetary compensation claims provided to them based on(From April 1, 2021 to March 31, 2022)(From April 1, 2022 to March 31, 2023)

the Plan as in-kind contributions and will receive the issuance or disposition of the Company’s common shares. The total

Net income per share
Net income or loss attributable to owners ofparent (million yen)Amount that does not belong to ordinary
shareholders (million yen)
Net income or loss attributable to owners of parent(related to common shares) (million yen)
Average number of shares during the period

number of common shares that the Company will issue or dispose of to the Target Directors based on the Plan will be(5,189)

(84)

–

–

(5,189)(84)

25,787,788

25,911,370

240,000 shares or less, and the amount to be paid in per share will be the closing price of the Company’s common sharesat the Tokyo Stock Exchange on the business day before the date of resolution at the Board of Directors’ meeting (if thetransaction is not closed on that day, the closing price on the transaction date immediately prior to that day).
For the issuance or disposition of the Company’s common shares based on the Plan, the Company will enter into a
restricted share allotment contract (hereinafter the “Allotment Contract”) with the Target Directors and executive officers,
and its content will include the following: (1) The Target Directors and executive officers may not transfer, hypothecate orotherwise dispose of the Company’s common shares allotted to them under the Allotment Contract for a certain periodof time; and (2) If a certain event occurs, the Company will acquire its common shares without compensation.

Important Subsequent Events

This time, the Company has decided to give the Target Directors and executive officers monetary compensation claimsof ¥58 million in total and 85,015 shares of its common stock based on the resolution made at the Board of Directors

At a meeting of its Board of Directors held on April 27, 2023, the Company resolved to purchase its own shares pursuant

meeting held on June 22, 2023 for the purpose of promoting talented human resources as an officer and further motivating

to the provisions of Article 459, Paragraph 1 of the Companies Act and the provisions of Article 41 of Articles Incorporation.

each Target Director and executive officer, taking into consideration the purpose of the Plan, the business performance

1. Reason for the acquisition of own sharesof the Company, the degree of contribution of each Target Director and executive officer, the scope of their work

As part of the execution of strategic capital policies aimed at achieving both a sound financial position and shareholder

93

responsibilities, and various other circumstances.

94

Notes to Consolidated Financial Statements

Current status of production, orders received, and sales(1) Production results
Production results by segment for the past two consolidated fiscal years are shown below.
Previous consolidated fiscal year

Current consolidated fiscal year

(From April 1, 2021 to March 31, 2022)(From April 1, 2022 to March 31, 2023)

Amount (¥ millions)

Amount (¥ millions)%

Die Casting Business: Japan

49,38955,69812.8

Die Casting Business: North America

28,05235,96528.2

Die Casting Business: Asia

27,803

34,612

24.5

Aluminum Business

7,534

8,052

6.9

Proprietary Products Business

1,675

2,566

53.2

114,455

136,895

19.6

Segment

Total

Increase/(decrease)

Note: Monetary amounts are based on manufacturing costs, as available prior to inter-segment eliminations.

(2) Results of orders received
A significant part or our businesses depends on make-to-stock production based on informal orders received
from customers, which are delivered (and sales recorded) for formal orders received several days prior to thedate of delivery. Therefore the listing of results on orders received has been omitted.
(3) Sales results
Sales results by business segment for the past two consolidated fiscal years are shown below.
Previous consolidated fiscal year

Current consolidated fiscal year

(From April 1, 2021 to March 31, 2022)(From April 1, 2022 to March 31, 2023)

Amount (¥ millions)

Amount (¥ millions)%

Die Casting Business: Japan

51,74659,01914.1

Die Casting Business: North America

28,111

36,995

31.6

Die Casting Business: Asia

26,48833,676

27.1

Aluminum Business

6,463

7,975

23.4

Proprietary Products Business

3,503

3,271

(6.6)

116,313140,938

21.2

Segment

Total

Increase/(decrease)

Notes: 1. Transactions among segments have been balanced out.
2. S ales results by major customers for the past two consolidated fiscal years and the ratio of their sales to overall sales are as
follows.

Customer
Subaru Corporation

95

Previous consolidated fiscal year

Current consolidated fiscal year

(From April 1, 2021 to March 31, 2022)(From April 1, 2022 to March 31, 2023)

Amount (¥ millions)%

Amount (¥ millions)%12,452

10.7

15,580

11.1

The Tag line “Casting Our Eyes on the Future”
embodies our business attitude of always moving
forward by taking the initiative in Researchand Development, Service and Technology
and by keeping all of our attention here at
Ahresty focused on our customers, the global
environment and the future of Ahresty itself, torealize the corporate philosophy represented in
our name.
The word “Casting” in the Tag line combines themeaning of “to throw one’s gaze” with its othermeaning of “to shape molten metal in a mold”
which is our main line of business, die casting.

Ahresty Corporation
Tokyo Head OfficeNakanosakaue Sunbright Twin 5F, 2-46-1 Honcho,
Nakano-ku, Tokyo, 164-0012, Japan
TEL. +81-3-6369-8660 FAX. +81-3-5358-5331
Issue: September, 2023