Business Report for Fiscal Year 2015
(From April 1, 2014 to March 31, 2015)
Stock code: 6995

To Our Shareholders
Review of Operations
Tokai Rika is grateful to its shareholders fortheir continued support.
In this business report, we present theCompany's business results for fiscal year
2015 (from April 1, 2014 to March 31, 2015)
and report on the challenges and opportunities
ahead.

Kenji Miura
President
1

In the fiscal year under review, the Japanese economy
was affected by a reactionary decline from the lastminute demand accompanying the consumption tax hike.
Although growth of certain emerging economies, such as
China, Thailand, and Brazil, slowed, in the U.S., personal
consumption was robust, while in Europe, the economy
continued to recover. As such, the world economy
maintained moderate growth, continuing from theprevious year.
In the automotive industry, although auto sales volumes
were lower than the previous year in Japan due to thereactionary decline from the last-minute demand
accompanying the consumption tax hike and in certain
emerging economies, such as Thailand and Brazil, where
economic growth was slowing, sales volumes increasedin the U.S. thanks to buoyant personal consumption, in
China where motorization made progress due to risingincomes, and in Europe due to the continuing economic
recovery. As a result, worldwide auto sales volumes
increased from the previous year.
In these circumstances, we worked to ensure quality
throughout the Group, reinforce manufacturing globally,
develop next-generation products, establish a strong
earnings base, and strengthen the Group’s global sites.
As specific initiatives, for quality and manufacturing, we
focused on building quality in processes and preparation
for production at our global sites and at suppliers in orderto smoothly ramp up production of products for ourcustomer’s global strategic model whose production isscheduled to start in fiscal 2015.
Regarding new product development, we received
commendations from customers for the development ofJapan’s first touchpad remote control device for vehicles,
which is adopted for Lexus NX and RC of Toyota Motor
Corporation; the next-generation automatic transmission
shift lever, which is compatible across all models, regions
and generations, developed through cooperation
between customers and our design, productionengineering, and manufacturing departments; and the
new decoration technology for steering wheels, whichwere adopted for the ALPHARD and VELLFIRE of Toyota
Motor Corporation and enhances product attractivenessthrough high-grade design. The Company established
Tokai Rika Advanced Co., Ltd., a wholly owned
subsidiary, in order to strengthen software developmentin the electronics business. With regards to strengtheningof global sites, with the start of operation of a new factoryat the site in Indonesia and expansion of factories at sites
in China, India, and the Philippines, we strengthened our
production structure in an effort to enhancecompetitiveness. Through these initiatives, we pursued
establishment of a strong earnings base.
Regarding financial results for the year under review,
net sales increased 14,388 million yen or 3.3% year on
year to 452,195 million yen thanks to increased
production volumes of customers in North America
despite the reactionary decline from the last-minutedemand accompanying the consumption tax hike inJapan. With respect to profit, despite an increase in fixed
costs, such as labor costs and depreciation, a weaker

yen and the impact of initiatives across the Group to
reduce costs led to a 1,077 million yen or 3.6% increasein operating income to 31,192 million yen. Ordinary
income decreased 81 million yen or 0.3% to 32,242
million yen owing to a decrease in non-operating income.
Net income increased 2,472 million yen or 14.3% to19,730 million yen owing to a decrease in provision for
product warranties despite reversal of deferred tax
assets from tax reform.
The Company paid out an interim dividend of 25 yen
per share in November 2014. The year-end dividend was
33 yen per share. As a result, total dividends for the year
under review, including the interim dividend, amounted to
58 yen per share, 12 yen higher than for the previous
year.

Challenges and Opportunities
With regard to the world economy, the pace of growthin emerging economies will likely slow in view of China’s
excess production capacity and Brazil’s tight fiscal andmonetary policies. On the other hand, in the U.S.,
personal consumption remained robust, and theJapanese economy is expected to recover owing to
improvement of household incomes through wage
increases and expansion of employment as corporate
earnings improve. Recovery of the economy in Europe is
expected to continue, suppor ted by large-scalequantitative easing. Therefore, the world economy isexpected to continue growing at a modest pace.
In the automotive industry, auto sales volumes are
expected to be below the previous year’s level in Japan,
affected by the stricter criteria for eligibility for tax
deductions for eco-friendly vehicles from April 2015.
However, a moderate increase in worldwide auto sales
volumes is expected because of robust sales in the U.S.
and China, and rising sales volume in Europe.
With respect to the business environment of the Group,in view of expansion overseas and shrinkage in Japan of
the automotive market, growing preoccupation withquality, severe price competition, and automotive
manufacturers’ strategic shift to more modular products,
competition is expected to intensify in the global

automotive industry.
In these circumstances, the Group will strengthen andcontinue with the initiatives launched in the previous yearthat have become deep and broad, namely, ensuring ofq u a l i t y t h ro u g h o u t t h e G ro u p , re i n f o rc e m e n t o f
manufacturing globally, development of next-generation
products, establishment of a strong earnings base, andstrengthening of the Group’s global sites. Concretemeasures include enhancement of our initiatives in Japanto prevent occurrence of major trouble and application ofthese initiatives to global sites to entrench them and thus
maintain and strengthen quality control. Moreover, we will
pursue creation of next-generation products in step withthe evolution of automotive vehicles, as well as creationof more attractive products offering both enhanced
product capabilities and cost reductions. We will also
implement a strategy attuned to the market environmentof each site in the Group’s global network. Through thesemeasures, we intend to secure competitiveness in theyears to come and establish a stable foundation forgrowth.
In these endeavors, we request our shareholders tofavor us with their continued support and guidance.
2Consolidated Financial Highlights
Net Sales(100 million yen)

Business Performance by Geographic Region
Ordinary Income and Net Income

Ordinary Income

5,000

4,378 4,521

4,000

323

3,195

3,000

210

2,000

140

1,000

70

0

0

Net Income

Net Sales (100 million yen)

322

Japan

280

3,719
3,276

350

Results by Geographical Region(100 million yen)

245
200
172

149

197

Composition of Net Sales

Net sales decreased 9,715 million yen (3.4%)
year on year to 278,782 million yen. Operating

200

3,000

150
2,000

income decreased 2,458 million yen (14.3%) to

54.2%

14,772 million yen owing to a decrease in sales

Asia

Net sales increased 6,561 million yen (7.1%) year

100
1,000
50

despite rationalization efforts and the impact of a
weaker yen.

Operating Income (100 million yen)

0

0

2013

2014

2015

2013

2014

2015

2013

2014

2015

2013

2014

2015

2013

2014

2015

81

2011

2012

2013

2014

Net Income per Share

2015

(Yen)

250

52

2011

51

2012

2013

2014

Return on Equity (ROE)2015

Composition of Net Sales

19.4%

North America

Net sales rose 20,197 million yen (23.2%) year

9.3

9.3

Composition of Net Sales

8

150

6
89.95

100
57.95

4

5.1
3.3

2

3

2011

2012

2013

2014

2015

0

2011

on year to 107,143 million yen. Operating income

2012

75

500

50

250

25

2013

2014

2015

20.9%

Europe andelsewhere

Net sales rose 1,906 million yen (7.3%) year on

5.5%

0

2013

2014

2015

80

1,200

60
800

increased 3,601 million yen (135.1%) to 6,265
million yen owing to increased sales.

Composition of Net Sales

0

750

0

40
400
20

0

0

2013

3.1

57.44

50

facility utilization in China and Thailand.

100

(%)

10
190.77decreased 1 million yen (0.0%) to 9,138 million
yen owing to the adverse impact of a decrease in

217.45200

on year to 99,589 million yen. Operating income

1,000

2014

2015

300

20

250

15

year to 28,089 million yen. Operating income

200

increased 556 million yen (48.7%) to 1,697

150

million yen mainly as a result of increased sales.

100

10
1
0

50
0

-1

2013

2014

2015

*Net sales include intersegment sales.

4Topics

Tokai Rika’s Product Fields

Human Machine Interface Systems, notably switches to accurately relay human commands, security systems to prevent
unauthorized access to automobiles, and safety systems to protect human lives. Wherever people and automobiles intersect,
we deliver comfort, safety and security by fully utilizing the underlying electronics technologies.

Highly Evaluated by Customers in Diverse Fields

New Factory of Filipino Subsidiary TRP Starts
Operation

At the global supplier conference of Toyota Motor Corporation in

In February 2015, TRP, Inc., our subsidiary in Laguna, the Philippines,

February 2015, Tokai Rika received the Toyota New Global Architecture

held a ceremony inaugurating its new factory. TRP, a manufacturer of

Switch/Interface

Security(TNGA) Promotion Superior Award, which is partswitches, which is our mainstay product, will celebrate its 20th anniver-

Switches/Human Machine Interface Systems

Security Systemsof Toyota’s initiatives to create ever-better cars. The

sary this year. The new factory is TRP’s fourth expansion project and it isCompany’s contribution to promotion of TNGA ini-

expected to increase TRP’s production capacity by 50%. TRP will help

tiatives through the development of an automatic

meet the expected increase in demand for parts for the Tokai Rika Group

Precise operability accurately conveying the drivers' commands, simplicity, and functional elegance are the hallmarks of our products.

Sophisticated mechanical and electronic anti-theft
functions ensure both security and ease of use.

transmission shift lever was recognized.

companies in ASEAN and elsewhere.

Smart Key Portable Device
and Emergency Key

Electro Shiftmatic

In addition, hologram wood-grain pattern, a new decorative technology forsteering wheels adopted for the new models ALPHARD and VELLFIRE produced at Toyota Auto Body Co., Ltd. received a project commendation (CEspecial mention) and a metallic door mirror visor using the indium evapoMulti-Function Switch

ration method, which was adopted for Aqua produced at Toyota Motor East
Japan, Inc., received a technology development award (parts category).

New Company to be Established in Mexico

Push Start Switch

Remote Key and Receiver

SafetyElectronics & Others

Safety Systems

Electronics & Others
Housing Facilities and Equipment

In April 2015 Tokai Rika decided to establish a new company in Nuevo
Moreover, the Company received the best partner award from Suzuki
Motor Corporation, which is an award for suppliers that contributed
throughout the year, and a transaction performance superior award from
Mazda Motor Corporation. Recently, overseas subsidiaries received
seven commendations from local customers, and our technological capabilities and manufacturing capabilities in diverse fields are highly evaluated by our customers.
5

León, Mexico. The name of new company is TOKAI RIKA MEXICO, S.A.
DE C.V. (TRMX) and it will be our first base in Mexico. TRMX will pro-Immobilizer

Our safety devices include seatbelts to protect drivers and passengers in the event ofcollision, stylish steering wheels optimized
for excellent handling, and mirrors thatenhance visibility.

Seatbelt for Pre-Crash
Safety System

Applying technologies originallyemployed in automotive
applications, we offer convenient
products meeting today's
housing-security needs.

duce Tokai Rika’s principal products, such as switches, key sets and seat-

La Lock Hallway Immobilizer Key Systembelts, and preparation is underway for the start of operation in fall 2016.

Automotive Accessories

Our aim is to strengthen our business foundation in North America where
the market is expected to show sustained growth.
Door Mirror with Side-Turn Lamp and Foot Illumination

Real Wood Steering Wheel**The steering wheel business is co-operated with Toyoda Gosei Co., Ltd.

Automotive Electronics
Products

We are a source of vehicle
décor with design flair.
These products allow
owners to enhance theappeal of their vehicles
through customization.

Power Supply ECU

We o f f e r p r o d u c t s f o r
function control and status
detection as well as various
types of connectors in
response to the ongoing
computerization of
automobile controls.
6

Consolidated Financial Statements

Stock Information/Dividends

Consolidated Balance Sheets (Millions of yen)

Stock Information (as of March 31, 2015)

As of March
31, 2015

As of March
31, 2014

188,464

189,121

Cash and deposits

25,82825,840ASSETS
Current assets

Notes and accounts receivable

61,35358,446

Electronically recorded monetary claims-operating

9,833

9,925

Marketable securities

37,234

46,191Inventories

35,745

31,106

Other current assets
Fixed assets
Tangible fixed assets

17,610186,731

149,814104,147

88,322Intangible fixed assets

2,059

1,701

Inventories and other assets

80,52359,790Investment securities

52,20542,097

Other

28,318

17,692

Total assets

375,195

338,935

As of March
31, 2014

108,918
40,407
17,383
3,437
47,691
27,0601,658
25,402
135,978

110,666
39,01817,4809,319
44,84821,601
2,615
18,986132,268

204,60722,85625,432
162,175(5,856)
22,769
4,778
9,268
8,723
239
11,599239,216
375,195

188,81422,85625,225
147,302(6,569)
7,273
3,158
1,054
3,060
530
10,048
206,667
338,935

Consolidated Statements of Income (Millions of yen)

Consolidated Cash Flow Statements (Millions of yen)

Year ended
Year ended
March 31, 2015 March 31, 2014

Year ended
Year ended
March 31, 2015 March 31, 2014

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Non-operating expenses
Ordinary income
Extraordinary gains
Extraordinary losses
Income before income taxes and minority interests
Income taxes-current
Income taxes-deferred
Income before minority interests
Minority interests in income
Net income
718,468LIABILITIESCurrent liabilities
Notes and accounts payable
Electronically recorded obligations-operating
Short-term borrowings
Other current liabilities
Long-term liabilities
Long-term borrowings
Other long-term liabilities
Total liabilities
NET ASSETS
Shareholders’ equity
Common stock
Capital surplus
Retained earnings
Less: Treasury stock, at cost
Accumulated other comprehensive income
Net unrealized loss on available-for-sale securities
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Stock acquisition rights
Minority interests
Total net assets
Total liabilities and net assets

As of March
31, 2015

452,195
384,525
67,67036,47831,192
1,618
568
32,24268
2,716
29,593
8,825(168)
20,936
1,206
19,730437,807373,146
64,661
34,54630,1152,875
667
32,323861
5,830
27,3539,191(432)
18,594
1,336
17,258Cash flows from operating activities

40,57131,312

Cash flows from investing activities(36,413)(40,255)

Cash flows from financing activities(11,375)(3,200)Effect of foreign currency translation
adjustments on cash and cash equivalents

1,265

419

Composition of Shareholders by Shareholder Type

Total number of shares
Total number of shares authorized to be issued:
Number of shares issued and outstanding:

200,000,000
94,234,171
6,521

Number of shareholders:

Treasury stock

3.5%

Major shareholders (Top 10)

Toyota Motor Corporation
Denso Corporation
Northern Trust Co. (AVFC) Re 15PCT Treaty Account
The Dai-ichi Life Insurance Company, Limited
The Master Trust Bank of Japan, Ltd. (Trust Account)
Japan Trustee Services Bank, Ltd. (Trust
Account)
State Street Bank and Trust Company 505223
Tokai Rika Employee Stock Ownership Plan
Mellon Bank, N.A. as Agent for its Client
Mellon Omnibus US Pension
State Street Bank and Trust Company 505103

29,367
8,839
2,478
2,275
1,834

32.28
9.71
2.72
2.50
2.01

1,650

1.81

1,473
1,117

1.61
1.22

1,062

1.16

988

1.08

0.7%

Individuals

EquityNumber of shares(thousands of shares) participation (%)

Shareholder

Securities firms

9.8%
Total number of shares

Foreign entities

26.6%

94,234,171

Corporations in
Japan

45.0%

Financial institutions

14.4%

Note: The Company holds 3,256 thousand shares of treasury stock but is excluded
from the major shareholders stated above.

Cash Dividends(Yen)

Full year

InterimAt the 68th annual general meeting of

70

40

20

Net increase (decrease) in cash andcash equivalents(5,952)(11,724)

10

Cash and cash equivalents at beginning of year

56,385

68,1100Cash and cash equivalents at end of year

50,432

56,385Company's proposal to pay the year-end

46

50

30

shareholders held on June 10, 2015, the

58

60

30

30

dividend to shareholders on the record
date of March 31, 2015, was approved.

32

16

14

14

2011

2012

2013

20

2014

25

2015

1

Year-end cash dividend

33 yen per share

2

Effective date for year-end dividend(payment commencement date)June 11, 20158

Company Information (as of March 31, 2015)
Global Network

Corporate overview

Tokai Rika is establishing globally standardized business processes in a manufacturing system consistentfrom development through to production and quality assurance.

Company name:TOKAI RIKA CO., LTD.
Establishment:
August 30, 1948

Gifu Pref.
ENA TOKAI RIKA Co., Ltd.

Paid-in capital:
22.8 billion yen

NSK Co., Ltd.

Tohoku Engineering Center

Head Office &Plant

RIKASEIKI CO., LTD.

Osaka Office

Number of employees:
17,348 (consolidated)

Tokai Rika Create Corporation
TOKAI RIKA
ADVANCED CO., LTD.

Kumagaya Office
Hachioji Office

Hiroshima Office

TOKAI RIKASERVICE Co., Ltd.

Toyota Plant

6,051 (non-consolidated)

Aichi Pref.
Hagi Plant

Otowa Plant

TOKAI RIKA
ELETEC CO., LTD.

MIROKU TECHNO WOOD Co., Ltd.

Head office:3-260 Toyota, Oguchi-cho, Niwa-gun, Aichi 480-0195, Japan

TRCZ s.r.o.

Wuxi Risho Technology Co., Ltd.

Sales of automotive parts

Production of automotive switches,seat belts, and push start systems

Production of seat belts and molds

Consolidated subsidiaries:
35
Affiliates accounted for by the equity method:
5

Tianjin Tokairika Automotive Parts Co., Ltd.
Production of automotive switches
Foshan Tokairika Automotive Parts Co., Ltd.
Production of keys, locks, shift levers,
and automotive switches

TRQSS,Inc.
DAEDONG CO., LTD.

TRMI,Inc.

Production of automotive
switches, keys and locks

Production of
automotive switches

Production of seat belts

Production of
automotive switches

TOKAI RIKA (THAILAND) CO., LTD.
Production of automotive switches,
keys and locks

TAC Manufacturing,Inc.

Holding company in North America,
sales, technology development

Production of steering wheels,keys and locks, and shift levers
TOKAI RIKA MINDA INDIA Private Limited.

TRIN,Inc.

Production of seat belts, keys and locks

Rica Auto Parts Co., Ltd.
PT.TOKAI RIKA INDONESIA

Senior Managing Director Kouji Buma

*Executive Vice President Yoshihiro Obayashi

Managing Director Koki Sato

*Executive Vice President Tadashi Wakiya

Managing Director Yoshihiro Tanaka

Senior Managing Director Tadanao Hamamoto

Managing Director Kazuhiko Noguchi

Senior Managing Director Kenji Kawaguchi

Managing Director Toshimasa Yamamoto

Senior Managing Director Hiroyuki Nakamura

Director

Yasushi Yamanaka

Senior Managing Director Masaharu Tanino
Audit & Supervisory
Board Member

Mikihiro Mori

Audit & Supervisory
Board Member

Takahiko Ijichi

Audit & Supervisory
Board Member

Masakazu Goto

Audit & Supervisory
Board Member

Kiyotaka Ise

Audit & Supervisory
Board Member

Yoshinori Yamada

Corporate Officer (with Senior
Mikio KatoManaging Director status)

Corporate Officer

Kiyomune Hayashi

Corporate Officer

Shigeru Hayashi

Corporate Officer

Koki Imaeda

Corporate Officer

Isaki Sugiura

Corporate Officer

Masami Nagaya

Corporate Officer

Kazuhiro Ikai

Corporate Officer

Masato Hotta

Corporate Officer

Toshiki Nogami

Corporate Officer

Hiroshi Nishida

Corporate Officer

Toshiki Akita

Corporate Officer

Yasutaka Watanabe

TRAM,Inc.

MINDARIKA PRIVATE LIMITED
Production of automotive switches

Kenji MiuraTGR Technical Center,LLC
Testing and evaluation

TRB Limited*President

Tel: +81-587-95-5211

SANDENZAISHA CO., LTD.

Tokai Rika Belgium N.V.

Executive Management (as of June 10, 2015)

Production of automotive switches

Note: Persons marked with an asterisk (*) are representative directors.

Production of automotive switches,
keys, locks and shift levers

Production of automotive switches, keys and locks
Thai Seat Belt Co., Ltd.
Production of seat belts

9

TOKAI RIKA ASIA CO.,LTD.

PT.TOKAI RIKA SAFETY INDONESIATRP,Inc.

TRBR INDUSTRIA E COMERCIO LTDA.

Holding company in ASEAN

Production of seat belts

Production of
automotive switches

Production of automotive switches
and shift levers

Major consolidated subsidiaries
Major affiliates
Other offices

10Shareholder Information
Business year
Annual general meetingof shareholders
Record date for
distribution of surplus
Number of sharesconstituting one unit of stock
Stock code
Transfer agent
Agency administration
officeFor inquiry/postal
address

Listing stock
exchanges
Method of public
noticeFrom April 1 to March 31 of the following year
June

Visit Our Website

Year-end dividend: March 31
Interim dividend: September 30
100 shares

The Tokai Rika Website provides a range of

6995
Sumitomo Mitsui Trust Bank, Ltd.
1-4-1 Marunouchi, Chiyoda-ku, Tokyo
Stock Transfer Agent Department, Sumitomo Mitsui Trust Bank, Ltd.
3-15-33 Sakae, Naka-ku, Nagoya
Stock Transfer Agent Department, Sumitomo Mitsui Trust Bank, Ltd.
2-8-4 Izumi, Suginami-ku, Tokyo 168-0063
Tel: 0120-782-031 (toll free in Japan)
Website:http://www.smtb.jp/personal/agency/index.html
Tokyo Stock Exchange, Nagoya Stock Exchange

to visit us online.

information on the Company. Public notices arealso posted on the website. We encourage you

http://www.tokai-rika.co.jp/

Electronic public notice at http://www.tokai-rika.co.jp/
If electronic public notice is unavailable, the Company
shall post a public notice in the Nihon Keizai Shimbun.

Notice1. Receipt of uncollected dividends
Please contact the transfer agent Sumitomo Mitsui Trust Bank, Ltd.
Please note that under the Articles of Incorporation of the Company,
the Company is not obliged to pay dividends that are unclaimed forthree full years from the date on which they first became payable. You
are requested to collect your dividends at your earliest convenience.
2.	Address change, purchase and sale of shares constituting lessthan one trading unit, and specification of the method of receiving
dividends
Please contact the securities firm with which you have your securities
account. If you have a special account, please contact Sumitomo
Mitsui Trust Bank, Ltd., which is the agent for managing special
accounts.
3. Dividend Statement
A dividend statement sent by the Company to shareholders upon payment of dividends also serves as the payment advice pursuant to the
Act on Special Measures concerning Taxation. It may be used as evidence when filing a final tax return.
*Please retain the dividend statement for your final tax return.
Vegetable oil ink and FSC-certified paper are used for the
purpose of protecting the environment.