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In Q1, our major customers’ automobile production declined in each region due to the spread of the newcoronavirus infection since February. Sales in Japan and North America in particular fell for the first time infour quarters to JPY23.8 billion, while operating income declined for the first time in three quarters toJPY2.2 billion. Ordinary income and net income declined for the first time in four quarters, to JPY1.7 billion
and JPY1.2 billion, respectively.

Both consolidated net sales and operating income declined significantly due to a decline in sales volume
caused by the impact of the coronavirus. Although the volume of materials is decreasing, we have been
improving costs more than in the previous year, and combined with cost reductions, the effect of JPY1.1
billion has been achieved.

Net sales of the Stamping and Molding Business decreased by 47% YoY to JPY15.7 billion, and net sales ofthe Valve Products Business decreased by 39% to JPY8 billion due to the significant impact of the decrease insales volume. For operating income, the Stamping and Molding Business posted a JPY2.1 billion loss and theValve Products Business posted a JPY100 million loss due to a decrease in the volume of products.

Both sales and income decreased in Japan, Europe and America, and Asia due to the impact of a decline inautomobile production in each region. Sales in North America, in particular, fell sharply due to the shutdownof customer production lines from the latter half of March to May. For the Chinese subsidiary, the impact ofdecreased production after the Chinese New Year is included in Q1, because of the settlement of accounts
in December.

Previously, forecasts for the full fiscal year of 2020 were undetermined, but we have decided to disclose theresults for the first half of the fiscal year and the full fiscal year, based on the results of Q1 and theproduction plans of major customers. Net sales declined by 44% in Q1, but with the expectation that theautomobile production will recover in the future, we forecast that net sales will decline by 13% in the Q2,and by 8% in the second half of the fiscal year.
As a result, we expect JPY58.5 billion for the first half of the fiscal year and JPY135 billion for the full fiscalyear. In terms of profits, Q2 will be profitable, but the impact of the decline in profit in Q1 was significant,and both profits are expected to be negative in the first half of the fiscal year. For the full fiscal year, we plan
to return to profitability with an operating income of JPY2 billion.

Similar to the results of Q1, both consolidated net sales and operating income are expected to decline
sharply due to a decline in sales volume caused by the impact of the coronavirus. Nevertheless, we willstrive to improve costs and reduce costs more than in the previous fiscal year. Assuming an exchange rate ofJPY105 for Q2 onward, the annual foreign exchange sensitivity is JPY100 million per Japanese yen.

Net sales in the Stamping and Molding Business for the full fiscal year are expected to decline by 16% YoY toJPY 95.1 billion, assuming that the production volume of major customers will recover to about 90% of theinitial target from Q2 onward. Operating income is expected to decline by 87% YoY to JPY500 million,
reflecting efforts to reduce labor costs and expenses and to improve costs, despite a decline in profits
resulting from a decline in sales and an increase in depreciation and amortization.
Next, for the full fiscal year of the Valve Products Business, we expect that the recovery of global automobile
production will be delayed, with full-year net sales expected to decrease by 24% to JPY39.6 billion, andoperating income expected to decrease by 78% to JPY1.4 billion due to a decrease in sales volume, andamortization of goodwill, despite our efforts to reduce costs.

Although we will remain profitable in Japan and Asia, we expect to post a loss of JPY500 million in Europeand America due to insufficient recovery in sales volume, and amortization of goodwill, despite a recovery in
the Stamping Business from Q2 onward.

In the current fiscal year, we will restrict capital expenditures while carefully selecting and implementing
necessary and effective investments. Depreciation is expected to be JPY15 billion due to the items that havebeen implemented since the previous year and the investment that has already begun.

Free cash flow for the current fiscal year is expected to be negative by JPY6 billion, but it will be covered byborrowings, and the deposit balance at the end of the fiscal year is expected to be JPY18 billion. Interestbearing debt is expected to increase by JPY7.5 billion to JPY71.1 billion due to short-term borrowings tosecure working capital and long-term borrowings for capital investment. With regard to capital demands, weare taking all possible measures by ensuring short-term borrowing limits and commitment lines while
managing funds across the Group.

With regard to dividends, based on the continuation of stable dividends, The Company pays dividends fromretained earnings after comprehensively considering factors such as business performance and the dividend
payout ratio. Taking into account the business forecast for the current fiscal year and the funding situation
based on the impact of the coronavirus, the Company plans to pay a full-year dividend of JPY20 per share,including a interim dividend of JPY10 per share and a year-end dividend of JPY10 per share, although we arein the red for the first half of the current fiscal year.

The current coronavirus crisis is challenging, but I think it is also our opportunity. In the midst of thecoronavirus problem, we have worked globally and steadily to prevent infection, and have maintained ourproduction system in accordance with changes in customers’ production. This is not only the result of theefforts of production sites, but also the result of our thorough efforts to improve our activities by changing
how to use our time, such as through changing the way staff work, using web conferences, et cetera, andincreasing the frequency of communication and speeding up decision-making.
I believe that these activities themselves will enhance our ability to reform ourselves. While production isrecovering, we will continue to make further improvements and aim to strengthen profitability from thenext fiscal year onward. While there is some uncertainty about future investment activities, over the past
four to five years, we have actively invested in areas that will lead to future growth. We believe that this willcontribute to the full-scale recovery from the next fiscal year onward. Regarding our current sales activities,
we are making steady progress in our Molding Business, such as super-high tensile strength steel andurethane in stamping. In our valve business, we are working to expand sales by leveraging our coretechnologies and to take on the challenge of new technological domains that use wireless technologies as
we prioritize them.
In promoting sustainability management, we have identified the materiality of our group based on SDGs andare promoting initiatives based on the four pillars of solving social and customer issues through our products,
minimizing environmental impacts, building trust with stakeholders, and respecting and contributing tohuman resources. Through these activities on a global scale, we believe that we can continue to contributeto society and grow as a company that is needed. That brings our explanation to a conclusion.