113The

To Our Shareholders

th Fiscal Year Business Report
April 1, 2021 ▶▶▶ March 31, 2022

Stock Exchange Code: 6623

To Our Shareholders
We are pleased to extend
our greetings to ourshareholders in presenting
our 113th annual report for
the fiscal year ended
March 31, 2022 (“FY2021”).

Overview of business
During the period under review, despite acontinuing upturn in conditions, the Japanese
economy struggled with factors such as global
supply chain disruptions and soaring resource
prices due to the resurgence of COVID-19 andthe situation in Ukraine, and the outlook is clouded. Our Group was affected by semiconductor
and electronic component supply issues andthe soaring price of raw materials, but the business environment remained favorable throughout the fiscal year thanks mainly to the spread ofelectric vehicles and a booming electronics industry.

Net sales 94.3 billion yen
Electric Power Products GroupOperating income 6.6 billion yen
Motor Products Group(Billions of yen)(Billions of yen)

94.3

100
80
60

80.0

47.3

75.0

75.6

46.2

47.7

0

6.6

7

65.9

5
4

4.2

4.1
2.8

3
2
32.7

28.7

27.8

28.4

110th

111th

112th

113th

(FY2018)

1

8
6

40
20

Under such circumstances, this fiscal year,
which marks the 80th anniversary of its foundation, our Group has taken the challenge to develop new products and businesses and worked
on enhancing the competitiveness of existing
businesses in line with the 2023 medium-term
management plan “Create the future with reliable technology - Innovation and Challenge -.”The Electric Power Products Group pushedahead with the development of sophisticatedpower distribution products, marketing in newenergy fields, and expanding sales of products
targeting the general manufacturing industry. At
the same time, it proceeded with initiatives toenhance quality, cost and delivery (QCD) suchas factory renewal, TPS improvement activities,
and fundamental quality reform activities. The
Motor Products Group worked on enhancing
production equipment to meet growing demand
for motors for car air-conditioner compressors
and package board cores. It also worked to ensure the supply of components and materials bydeveloping new and substitute suppliers.

(FY2019)(FY2020)(FY2021)

1
0

110th

(FY2018)

111th(FY2019)

112th(FY2020)

113th(FY2021)

With regard to the consolidated performance for the fiscal year ended March 31, 2022,
both sales and income increased comparedwith the previous fiscal year, due to a strong
performance from the Motor Products Group.
Net sales increased by 24.8% to 94,381 million
yen, operating income increased by 59.5% to
6,667 million yen, ordinary income increased by
67.7% to 7,966 million yen, and net income attributable to owners of parent increased by
66.7% to 5,564 million yen.
Dividend
Our final dividend was 100 yen per share,including a commemorative dividend of 35 yen
per share to mark the 80th anniversary of theGroup’s founding. Combined with the interim
dividend, the total dividend was 150 yen per
share.
Future prospects
Concerns remain regarding the businessconditions surrounding our Group, in view of

Ordinary income 7.9 billion yen(Billions of yen)

7

June 2022
President(Billions of yen)

8
7

6
5

We appreciate your continued understanding and support.

Net income attributable to owners of parent 5.5 billion yen

7.9

8factors such as soaring resource prices due tothe resurgence of COVID-19 and the situation in
Ukraine, and intensifying competition due towheeling cost reductions by power transmission
and distribution companies. However, growth isexpected in demand for products such as
motors for car air-conditioner compressors,sophisticated power distribution products andpackage board cores, in the context of the accelerating spread of electric vehicles, promotionof the introduction of renewable energy andhigh growth in semiconductor markets. The
Group will continue to strive to be even morecompetitive through enhanced QCD, and aim
for sustainable business growth through active
investment in growth fields.

4

4.7

5
4

3.3

3

3

2

2

1
0

5.5

6
4.8

3.1

2.7

3.3

1

110th

(FY2018)

111th(FY2019)

112th(FY2020)

113th(FY2021)

0110th(FY2018)

111th(FY2019)

112th(FY2020)

113th(FY2021)2

Performance at Each Group■Electric Power Products GroupNet sales 28.4 billion yen
Sales ratio

Business description
This Group is engaged in the design, manufacture and sale of electricalequipment such as different types of transformers, protection and control
devices, equipment related to renewable energy, and industrial equipment
such as powder processing machines and hot water boilers, as well as
designing and executing the construction of receiving and transforming
substations in Japan and overseas.
Overview of FY2021
Sales ratio
Compared with the previous year, net sales
increased by 2.0% to 28,410 million yen while
segment income decreased by 16.7% to 2,961
30were％million yen. Net sales
little changed fromthe previous year, as sales of controllers declined
but sales of small transformers were robust.
Segment income decreased due to the impact ofsoaring materials costs.

30％

Net sales trend (Billions of yen)

28.7

111th

(FY2019)

27.8

112th

(FY2020)

28.4

113th

(FY2021)Main products

Pole-mounted
transformers“TOP RUNNER”
low loss transformers

Power conditioners
3

Step voltage
regulators (SVR)

Powder processing
machinesOn-load tap-changing
transformers (LRT)

Hot water
boilers

Digital-type devices
for monitoring,protection and control

Receiving and transforming
substation construction

■Motor Products GroupNet sales 65.9 billion yen
Sales ratio

Business description

This Group supplies products that facilitate daily living, such as various
small motors including hermetic motors for air conditioner compressors,
printed wiring boards, linear actuators for electric beds, shutter operators,
etc.

Overview of FY2021
Sales ratio
Compared with the previous year, net sales
increased by 38.1% to 65,971 million yen andsegment income increased by 139.4% to 5,489
million yen. Both net sales and segment income
70％
increased substantially
due to strong overallsales of products such as motors for car andbuilding air-conditioner compressors andpackage board cores.

70％

Net sales trend (Billions of yen)

65.9

47.7

46.2

111th

112th

(FY2019)(FY2020)

113th(FY2021)Main products

Hermetic motors for
air-conditioner compressors

Motors forsubmersible pumps

Printed wiring boards

Shutter operators

Linear actuators
Controllers and handsets forlinear actuators

Fans for cattle farms

Inverters
4

Financial Report
Consolidated Balance Sheets
Assets

FY2021

FY202074,17936,12424,988509
10,62665,07831,117
19,968368
10,780(As of March 31, 2022) (As of March 31, 2021)

Current assets
Non-current assets
Property, plant and equipment
Intangible assets
Investments and other assets

Total assets

110,304

96,196(Millions of yen)

Liabilities andNet assets

FY2021

FY202037,027
9,768
46,796

29,516
9,190
38,70759,4392,790
1,278
63,508110,304

54,805
1,528
1,154
57,48896,196(As of March 31, 2022) (As of March 31, 2021)

Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

Consolidated Statements of Income
FY2021

FY2020(From April 1, 2021
to March 31, 2022)(From April 1, 2020
to March 31, 2021)

Net sales

94,381

75,619

Cost of sales

79,61264,510Gross profit

14,768

11,109Selling, general and administrative expenses

8,100

6,929

Operating income

6,667

4,179

Non-operating income

1,466

837

166

265

7,966

4,751

Extraordinary income

34

67

Extraordinary losses

148

43

Income before income taxes

7,853

4,775

Income taxes-current

2,231

1,723

Income taxes-deferred

65

(324)

5,557

3,376

(7)

38

5,564

3,338

Non-operating expenses
Ordinary income

Net income
Net income (loss) attributable to non-controllinginterests
Net income attributable to owners of parent
5(Millions of yen)Non-Consolidated Balance Sheets
Assets

FY2021

FY202041,50927,0458,916
70
18,05840,24025,8138,599
68
17,145(As of March 31, 2022) (As of March 31, 2021)

Current assets
Non-current assets
Property, plant and equipment
Intangible assets
Investments and other assets

Total assets

68,55566,054(Millions of yen)

Liabilities andNet assets

FY2021

FY202017,573
3,923
21,496

15,6695,414
21,08446,031
1,026
47,05868,55543,707
1,262
44,96966,054(As of March 31, 2022) (As of March 31, 2021)

Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Valuation and translation adjustments
Total net assets
Total liabilities and net assets

Non-Consolidated Statements of Income(Millions of yen)

FY2021

FY2020(From April 1, 2021
to March 31, 2022)(From April 1, 2020
to March 31, 2021)

Net sales

52,11546,295

Cost of sales

43,74539,270Gross profit

8,369

7,025

Selling, general and administrative expenses

4,741

4,355

Operating income

3,627

2,670

Non-operating income

989

782

Non-operating expenses

67

68

4,550

3,384

Extraordinary income

55

3,327

Extraordinary losses

81

3

Income before income taxes

4,523

6,708

Income taxes-current

1,164

1,128

Income taxes-deferred

103

(189)

3,255

5,770

Ordinary income

Net income

6Celebrating the 80th Anniversary
This year marks the Company’s 80th anniversary. We would like to take this opportunity to again
express our gratitude for your continued understanding and support.
Our focus on technology and passion for manufacturing has been passed down over the decades
since the Company was founded in 1942. Under our basic management policy of “Active
management, Technology training, Respect for human,” we have engaged in developing andproviding transformers and controllers to ensure a stable supply of high-quality electricity, andproducts to support a comfortable lifestyle such as motors and printed wiring boards.

1942“Aichi Electric Repair
Company” was bornFounded by Shoichi Kawaguchi withthe aim of doing his best for society
through the repair of broken or
discarded transformers and electricmotors, amid a shortage of resources
due to the Pacific War.

1942

1947

1957

1973

Commenced manufactureof new pole-mounted
transformers

Launched the motor business

Established 275kV-class highvoltage large transformer factory

As social conditions stabilized
after the post-War per iod of
turbulence, the Company began
to manufacture new products inanticipation of growing demand
for transformers in 1947.

Shoichi Kawaguchi had participated ina business mission tour of the United
S ta te s o rga n i ze d by t h e Ja p a n
Productivity Center in 1955, where hemarveled at the prevalence of electricalappliances in use. He launched the
motor business in anticipation of the
future spread of small motors in Japan.

A cast tank pole-mounted transformer
manufactured in 1949

The prototype condenser motor completed
in 1957

1950

1970

1980

1952

1961

1964

Launched the controllerbusiness

Consolidated factories in
Kasugai City

The controller business began withthe manufacture of DC transmission
system integrating wattmeter switch­ing equipment, around 50 sets ofwhich were delivered to Chubu Elec­tric Power Co., Inc. in 1953.

The Company purchased approximately
165,000 m 2 of land in Kasugai City
(current head office location) in 1957
a n d bu i l t a l a rg e - s c a l e fa c to r y,
consolidating its factories to increase
productivity. Overcoming damage from
Typhoon Vera (Ise Bay Typhoon), which
struck immediately after the first stageof construction was completed, theCompany succeeded in gathering all its
factories at the new site in 1961.

Technical alliance with
Emerson Electric Co. in the
United States

DC transmission controller developed in 1952

7

1960

I n 19 7 0 , c o n c l u d e d t e c h n i c a lcollaboration with ELIN UNION,
Austria. Obtained technology to
produce high voltage large trans­
fo r m e rs ( ra n g i n g f ro m 7 7 k V to
154kV), which led to the constructionof a high voltage large transformer
factory that can manufacture up to
275kV-class transformers in 1973.

Construction of the new factory in Kasugai City in 1959

The Company established AichiEmerson Electric Co., Ltd., a joint
venture with Emerson Electric Co. in
the United States, to respond to therapid popularization of refrigerators
and air conditioners in Japan.

A history of the first century of Emerson ElectricCo. records the joint establishment of AichiEmerson Electric Co., Ltd. with Aichi Electric in
1964 as one of the early joint ventures undertaken.

Looking ahead to the Company’s 100th anniversary in 20 years, we will engage in further development
and provide a diverse range of value to all our stakeholders under our medium-term corporate
philosophy: to be “a valuable company that creates good products, develops good human resources,and establishes good relationship.”
2005-2020
Expanded the motor business
into China
	EstablishedSUZHOU AICHI2005
TECHNOLOGY CO., LTD.

2006-2011
Constructed new productionlines at the transformer andcontroller factories

SUZHOU AICHI	Established2011
GAUSS MOTOR CO., LTD.

2006 	Constructed a new pole-mounted
transformer production line

2020
GUANGZHOU AICHI	Established
ELECTRIC CO., LTD.

2008 	Constructed a new medium trans­
former production line

1992

2009 	Constructed a new large trans­
former production line
2011 	Constructed a new controller pro­duction line

Completed construction of
the Head Office Building

The new production line at the controller factory

1990

1986
Company name changed
We changed the name of the Company
from AICHI ELECTRIC MFG.CO., LTD. to
AICHI ELECTRIC CO., LTD. At the sametime, we renewed the corporate image,designating royal blue as the Company’s
official color and changing the company
name logo. We also shifted the fiscal
year-end from May 31 to March 31.

2000

2010

2022

80th
anniversaryof founding

Toward acentenarycompany

2020

1993

2017-2020

Commenced mass-production of
actuators

Reorganized Group companies

The Company, which already possessed thetechnology for brushless DC motors, beganmass-producing geared motors in 1993, in
response to a drive system development
request from PARAMOUNT BED CO., LTD. In
1995, we commenced mass production of
actuators as drive systems for hospital beds.

A system for home nursing beds including a geared
motor, which began mass production in 1993

	Absorbed
Aiden Shoji Co., Ltd.
2017
by merger
	2020
Absorbed AICHI ELEC CO.
( fo r m e r ly A i c h i - E m e rs o nElectric Co., Ltd.) by merger
	SHIROTORI
2020
AICHI ELEC
CO., LTD. absorbed ENAAICHI ELECTRIC CO., LTD.
by merger, and changed its
name to SHIROTORI ENAAICHI ELECTRIC CO., LTD.

8

Topics
Electric Power Products Group
Development of a dry-type balancer for low voltage power distribution lines
We have developed a balancer that does not use insulation oil.
Balancers are installed in low voltage power distribution lines to improve voltage
imbalances.
Previous balancers used insulation oil and were at risk of oil leakage mainly
from tank rust. To resolve this problem, we used urethane resin to replace insulation
oil as a filler. This resin is then hardened to prevent the risk of liquid leakage.
We also improved the method used to attach balancers to electricity poles toenhance usability and prevent the risk of falling parts during installation.
We will continue to develop useful products to ensure a stable supply ofelectricity.

Electric Power Products Group
Development of a new type of powder processing machine
We have developed a waterproof, corrosion-resistant, 1000-liter typepowder processing machine that can be washed using water.
This new product meets the needs of customers who wish to use water
to wash the machine itself. Moreover, we are able to provide these machines
at a low price by reducing the number of components and the standardizationof models. We have also increased the angle of inclination of the container.
This improves usability by facilitating the input of materials at the top of thecontainer and output from the bottom.
Powder processing machines are used in many fields such as thepharmaceuticals industry and the food industry.
We will continue to develop products that accurately capture customer
needs.

New type powder
processing machine

Motor Products Group
10th anniversary of SUZHOU AICHI GAUSS MOTOR CO., LTD.
SUZHOU AICHI GAUSS MOTOR CO., LTD. (a consolidated
subsidiary in China) has celebrated its 10th anniversary.
This company is a base for the manufacture of motors for car
air-conditioner compressors in China. Its business is steadily
growing against the backdrop of the global spread of electricvehicles, and it began full-scale operation at a new factory in
FY2021, doubling its production capacity.
We aim to continue to grow this business amid the forecast
expansion of the electric vehicle market.

9

Panorama of the new factory

Outline of the Company, Board of Directors and Auditors, and Status of Shares
Corporate Data (As of March 31, 2022)

Status of Shares (As of March 31, 2022)
Total number of shares authorized to be issued 23,912,200 shares
9,500,000 shares

Total number of shares issued
Established:

May 27, 1942

Capital:4,053 million yen

Number of Employees: 1,071 (Consolidated: 2,676)
Head Office:

Major shareholders (top ten shareholders)

1, Aichi-cho, Kasugai city, Aichi pref.,Number of shares Shareholding ratio (%)(thousand shares)

486-8666, JAPAN
Phone +81-568-31-1111

Board of Directors and Auditors(As of June 29, 2022)

6,772 persons

Number of shareholders

Chubu Electric Power Co., Inc.

2,326

24.5

Furukawa Electric Co., Ltd.

565

5.9

TSUCHIYA CORPORATION

500

5.2

BBH FOR FIDELITY LOW — PRICED STOCK FUND
(PRINCIPAL ALL SECTOR SUBPORTFOLIO)

397

4.1

President

Kazuo Kobayashi

MUFG Bank, Ltd.

312

3.2

Managing Director

Toshiyuki Miyakawa

Custody Bank of Japan, Ltd.
(trust account 4)

303

3.1

Managing Director

Shinobu Kato

Yasumitsu Shigeta

266

2.8

Director

Naoji Yamashita

Kawaguchi Kosan Co., Ltd.

200

2.1

Director

Hisashi Tajima

HIKARI TSUSHIN, INC.

186

1.9

Director

Masaki Kakihara

Director

Yoshikazu Suda

Meiji Yasuda Life Insurance
Company

175

1.8

Director

Yukinari Yokote

Director

Hiroyuki Muto

Note 1	Numbers of shares are rounded down to the nearest
thousand shares.
Note 2	The treasury shares (4,634 shares) were excluded in
the calculation of the shareholding ratio.

Director (Outside)

Keiichiro UrakamiDistribution of shares by shareholder

Director (Outside)

Hideshige Seo

Auditor

Hideki Hosoe

Auditor (Outside)

Akinori Kataoka

Auditor (Outside)

Wataru Hashimoto

Foreigninvestors
12.9%

Individual
investors
25.4%

Domestic
investors
87.1% Financial institutions
and securities firms
16.5%
Other companies,
etc.
45.2%

10

Information on SharesBusiness Year

April 1 to March 31 of the following year

Ordinary General Meeting Juneof Shareholders
Record date for shareholder March 31
rights for the Ordinary General
Meeting of Shareholders
Record date for year-end March 31
dividend
Record date forinterim dividend

Frameworks are in place to ask the Company to buyback or request additional purchases of fractional
shares less than one unit. If you are interested, pleasecontact the following.

September 30

Contacts for various procedures

Stock Transfer Agent andSumitomo Mitsui Trust Bank, Limited
Account Management
1-4-1, Marunouchi, Chiyoda-ku, Tokyo, JAPANInstitution for Special Accounts
Handling Office

Stock Transfer Agency Business
Planning Department, Sumitomo Mitsui
Trust Bank, Limited
3-15-33, Sakae, Naka-ku, Nagoya,
JAPAN

Inquiries

Stock Transfer Agency Business
Planning Department, Sumitomo Mitsui
Trust Bank, Limited
2-8-4, Izumi, Suginami-ku, Tokyo
168-0063, JAPAN
Telephone +81-120-782-031 (toll-freein Japan)Public Notices

Information regarding the share buyback
and additional purchase program for
fractional shares less than one unit
(shares less than 100 shares)

Public notices shall be madeelectronically.
Public notice URL:
https://www.aichidenki.jp
If electronic notice is impossible due toaccidents or other unavoidable
circumstances, the notice shall be
posted in the Chunichi Shimbun which is
published in Nagoya city.

(Changes in name or address, buyback and additionalpurchase of fractional shares less than one unit)
For shareholders who have an account with asecurities company
Please contact your securities company.
For shareholders who do not have an account with asecurities company
P lease contact Sumitomo Mitsui Trust Bank,
Limited.

Concerning outstanding dividend payments
Please contact Sumitomo Mitsui Trust Bank, Limited.