NIPPON THOMPSON CO., LTD.
Corporate Headquarters: Tokyo
Listed Code: 6480
Li sted Stock Exchange: Tokyo(URL: http://www.ikont.co.jp/eg/)

May 14, 2018

Consolidated Financial Reportfor the Fiscal Year ended March 31, 2018
<Japanese GAAP>
Representative: Shigeki Miyachi, President and Representative Director
For further information contact: Kesaaki Ushikoshi, General Manager of Accounting Department
Telephone: +81-3-3448-5824
Scheduled Date of Ordinary General Meeting of Shareholders:
Scheduled Date to Submit Annual Securities Report:
Scheduled Date to Begin Dividend Payments:
Preparation of Supplementary Explanation Material for Financial Results:
Holding of Presentation Meeting for Financial Results:

June 28, 2018
June 28, 2018
June 29, 2018
Yes
Yes (Targeted at institutional investors and analysts)

Figures have been rounded off to eliminate amounts less than one million yen.

1. Consolidated Operating Performance for the Fiscal Year Ended March 31, 2018
(From April 1, 2017 to March 31, 2018)(1) Results of Consolidated Operations
Years ended March 31, 2018 and 2017
Net sales

PercentagechangeOperatingprofitPercentagechangeOrdinary
profitPercentagechange(Millions of yen)
Profitattributable Percentage
to ownerschangeof parent
1,678
－
(291)
－

2018
55,228
25.1
2,649
131.2
2,397
164.7
2017
44,1301.1
1,145(62.0)
905(67.2)
Notes: Comprehensive income
Fiscal year ended March 31, 2018: 2,317 million yen(71.9)%
Fiscal year ended March 31, 2017: 1,348 million yen(－))%: Percentage change for net sales, operating profit, ordinary profit, and profit attributable to owners of parent indicate
percentage increase/decrease compared to the same period in the previous year.
Earnings
per share
(Yen)
23.35
(4.04)

Diluted earnings per
Return on equity
share
(%)
(Yen)
2018
23.30
2.9
2017
(0.5)
－
Reference: Equity in earnings of affiliates
Fiscal year ended March 31, 2018:－ million yen
Fiscal year ended March 31, 2017:－ million yen

Ordinary profit tototal assets
(%)
2.4
1.0

Operating profit to
net sales
(%)
4.8
2.6

The fiscal year 2018

(2) Consolidated Financial Position
Years ended March 31, 2018 and 2017

2018
2017

Total assets

Net assets

Equity ratio(%)

99,836
99,62759,66658,605

59.3
58.4(Millions of yen)
Net assets
per share(Yen)
828.26810.11

Reference: shareholders’ equity
Fiscal year ended March 31, 2018: 59,217 million yen
Fiscal year ended March 31, 2017: 58,216 million yen(3) Consolidated Cash Flows
Years ended March 31, 2018 and 2017
Operating
Investingactivities
activities
2018(6,043(1,379)2017
4,981(5,376)

Financing
activities(6,696)
7,126(Millions of yen)
Cash and cash
equivalents
18,01920,0402. Dividends
Dividends per share
Base date2019(Forecast)
2018
2017

June 30
(Yen)
－
－
－

Base date

Total dividends(Full fiscal year)(Millions of yen)

2019(Forecast)
2018
2017

935
936

September 30
(Yen)
7.50
6.50
6.50

December 31
(Yen)
－
－
－

Dividends payout
ratio(Consolidated)
(%)
28.2
55.7
－

Dividends on
net assets(Consolidated)
(%)
1.6
1.6

2

March 31
(Yen)
7.50
6.50
6.50

Full fiscal year
(Yen)
15.00
13.00
13.00

The fiscal year 2018

3. Forecast of Consolidated Operating Performance for the Fiscal Year Ending March 31, 2019
Six-month period ending September 30, 2018, and the fiscal year ending March 31, 2019
Percentage
Operating
Percentage
Net saleschangeprofitchangeSix-month period ending
30,000
15.2
2,600
266.2
September 30, 2018Year ending March
61,000
10.5
5,500
107.6
31, 2019
Profitattributable toowners ofparent(Millions of yen)
Ordinary
Percentage
profitchange
2,550

222.7

5,400

125.3

Earnings
per share(Yen)

PercentagechangeSix-month period ending
1,800
72.5
25.17
September 30, 2018Year ending March
3,800
126.4
53.11
31, 2019
Note: Percentage change for net sales, operating profit, ordinary profit, and profit attributable to owners of parent indicate
percentage increase/decrease compared to the same period in the previous year.

4. Others(1) Changes in the state of significant subsidiaries during the period (Changes regarding specific companies accompanying
changes in the scope of consolidation): None
(2) Changes in accounting principles and accounting estimates, and restatements
Changes in accounting principles arising from revision of accounting standards:
Changes other than those in above:
Changes in accounting estimates:
Restatements:

None
None
None
None

(3) Number of shares issued (Common stock)
Number of shares outstanding at period-end (Including treasury stock)
Fiscal year ended March 31, 2018:
73,501,425 sharesFiscal year ended March 31, 2017:
73,501,425 shares
Number of treasury stock
Fiscal year ended March 31, 2018:
2,005,532 sharesFiscal year ended March 31, 2017:
1,638,790 shares
Average number of shares outstanding at period-end
Fiscal year ended March 31, 2018:
71,886,988 sharesFiscal year ended March 31, 2017:
72,077,206 shares
Note: The number of treasury stock includes treasury stock held by the ESOP trust. This resulted in the addition to treasury
stock of 480,100 shares as of March 31, 2018 and 113,700 shares as of March 31, 2017. In addition, treasury stock
held by the ESOP trust is excluded from the calculation of the average number of shares outstanding at period-end, as
is other treasury stock. The number of shares excluded from said calculation totaled 89,183 shares for the fiscal year
ended March 31, 2018 and 207,766 shares for the fiscal year ended March 31, 2017.

3

The fiscal year 2018

Reference: Non-consolidated Operating Performance for the Fiscal Year Ended March 31, 2018
(From April 1, 2017 to March 31, 2018)(1) Results of Non-consolidated Operations
Years ended March 31, 2018 and 2017
Net sales

Percentagechange(Millions of yen)

OperatingprofitPercentagechangeOrdinary
profitPercentagechangeProfitPercentagechange

－
1,227
－
810
(72)
(534)
－
－
Note: Percentage change for net sales, operating profit, ordinary profit, and profit indicate percentage increase/decrease
compared to the same period in the previous year.
2018
2017

2018
2017

45,874
38,276

Earnings
per share
(Yen)
11.27
(7.41)

19.8
0.8

964
(82)

Diluted earnings
per share
(Yen)
11.25
－

(2) Non-consolidated Financial Position
Years ended March 31, 2018 and 2017

2018
2017

－
－

Total assets

Net assets

Equity ratio(%)

91,04591,44653,01353,02658.1
58.0(Millions of yen)
Net assets
per share(Yen)
740.42737.47

Reference: shareholders’ equity
Fiscal year ended March 31, 2018: 52,937 million yen
Fiscal year ended March 31, 2017: 52,996 million yen

These consolidated financial statements are not subject to quarterly review by auditors
Explanations or Other Items Pertaining to Appropriate use of Operating Performance Forecasts
Performance forecasts presented herein are based on information available to the Nippon Thompson Group (the “Group”)
as of the date of this document, May 14, 2018. Accordingly, for a wide variety of reasons, there remains the possibility that
actual performance results may differ from projections. For performance forecasts, please refer to “Overview of Operating
Results (4) Outlook” on page 7.

4

The fiscal year 2018

5. Operating Results and Financial Position(1) Analysis of Operating Results
In the consolidated fiscal year ended March 31, 2018, the Japanese economy continued to gradually improve against a
backdrop of rising corporate profits, employment figures, and income levels as well as increased private capital investment.
Overseas, the U.S. economy remained steady, and European and Asian economies on the whole continued to recover.
Under these circumstances, the Group has entered into the final fiscal year of its “IKO Mid-term business plan 2017
(three-year plan) CHANGE & CHALLENGE,” which began in April 2015. The Group has implemented a wide range ofinitiatives to strengthen its earnings base while expanding its businesses and ensuring sustained growth.
From a sales perspective, amid robust demand for private capital investment and a consistently high level of orders,the Group worked to further cultivate business ties with existing customers while focusing on expanding sales of strategic
products, demand for which is expected to increase going forward.
From a production standpoint, with orders continuing to rapidly rise, the Group worked quickly to upgrade its
supply framework, mainly by increasing the number of personnel at domestic factories and the production subsidiary IKO
Thompson Vietnam Co., Ltd. In addition, the Group strove to expand its overall production capacity and boost profitability by
reducing costs.
Turning to the Group's operational results, domestic and overseas markets remained strong due to active capital
investment in the industries of our main customers. In the domestic market, net sales increased due mainly to demand formachine tools and for electronics-related devices, including semiconductor manufacturing equipment and electronic component
mounting equipment. Overseas, net sales rose in North America as demand remained firm for machine tools and precision
machinery. In Europe, net sales increased amid growing demand for machine tools and electronics-related devices. In Asia,
sales soared due to the inclusion of UBC (Shanghai) Precision Bearing Manufacturing Co., Ltd. as a consolidated subsidiary as
well as higher demand in Hong Kong, Taiwan, South Korea, and China, where the companies are maintaining a steadyprogram of investment in production automation and labor-saving technology as well as capital investment ininfrastructure-related projects.
As a result, consolidated net sales for the fiscal year under review totaled ¥55,228 million, up 25.1% year on year.
On the earnings front, production efficiency worsened temporarily following the installation of a new mission-critical system.
However, due mainly to increased revenue and production, operating profit came to ¥2,649 million, up 131.2% year on year,
and ordinary profit came to ¥2,397 million, up 164.7% year on year. Profit attributable to owners of the parent amounted to¥1,678 million, compared with loss attributable to owners of the parent of ¥291 million for the previous fiscal year.
Because the Group manufactures and sells Needle Roller Bearings, Linear Motion Rolling Guides and Machine
Components on an integrated basis, disclosure of segment information has been omitted. Sales of Needle Roller Bearings andLinear Motion Rolling Guides totaled ¥47,990 million, an 23.7% increase compared with the corresponding period in theprevious fiscal year. Sales of Machine Components rose 35.7% to ¥7,237 million.

5

The fiscal year 2018

Business Segment Information
March 31,2018
Millions of Component
yenpercentages
Needle Roller Bearings, Linear
Motion Rolling Guides
Machine Components
Total net sales

March 31,2017
Millions of Component
Yenpercentages

ChangeMillions ofyen

Percentagechange47,99086.9

38,797

87.9

9,193

23.7

7,237

13.1

55,228

100.0

5,332
44,130

12.1
100.0

1,904
11,09735.7
25.1(2) Summary of Financial Position
Total assets as of March 31, 2018, totaled ¥99,836 million, an increase of ¥208 million compared with the end of the previous
fiscal year. This mainly comprised increases in notes and accounts receivable-trade of ¥3,260 million and investment securitiesof ¥679 million as well as decreases in cash and deposits of ¥2,136 million, inventories of ¥373 million, deferred tax assets of¥219 million, tangible fixed assets of ¥558 million and intangible assets of ¥418 million.
Total liabilities amounted to ¥40,170 million, a decrease of ¥851 million compared with the end of the previous
fiscal year. This mainly comprised increases in notes and accounts payable-trade of ¥2,795 million, accrued expenses of ¥510
million, accounts payable-other of ¥832 million and deferred tax liabilities of ¥279 million as well as decreases in short-termloans payable of ¥400 million and corporate bonds of ¥5,000 million.
Total net assets amounted to ¥59,666 million, an increase of ¥1,060 million compared with the end of the previous
fiscal year. This mainly comprised increases in retained earnings of ¥742 million and net unrealized holding gains onavailable-for-sale securities of ¥474 million.

(3) Summary of Cash Flows
Cash and cash equivalents at the end of the fiscal year under review totaled ¥18,019 million, a decrease of ¥2,020 million
compared with the end of the previous fiscal year.
Cash Flows from Operating Activities
Net cash provided by operating activities was ¥6,043 million. The major inflows were profit before income taxes of ¥2,489
million, depreciation and amortization of ¥3,094 million, a decrease in inventories of ¥410 million, an increase in notes andaccounts payable-trade of ¥2,704 million and an increase in accrued expenses of ¥326 million, while the major outflows was anincrease in notes and accounts receivable-trade of ¥3,196 million.
Cash Flows from Investing Activities
Net cash used in investing activities totaled ¥1,379 million. This was mainly due to proceeds from cancellation of insurance
funds of ¥532 million, while the major outflows were purchase of property, plant and equipment of ¥1,539 million andpurchase of insurance funds of ¥260 million.
Cash Flows from Financing Activities
Net cash used in financing activities totaled ¥6,696 million. This was mainly due to redemption of bonds of ¥5,000 million,
purchase of treasury shares of ¥420 million and cash dividends paid of 935 million.
6

The fiscal year 2018

The trend of cash flow indices is as follows:
For the periods ended

Equity ratio (%)
Equity ratio on market value basis (%)
Debt repayment period (Years)
Interest coverage ratio (Times)

March 31,
2015
65.4
46.3
2.4
74.6

March 31,
2016
65.0
32.6
7.1
21.6

March 31,
2017
58.4
43.6
5.4
43.4

March 31,
2018
59.3
60.9
3.5
43.3

Notes:
Equity ratio:

Total shareholders’ equity / total assets

Equity ratio on market value basis:

Aggregate market value of common stock / total assets

Debt repayment period:

Interest-bearing liabilities / cash flows from operating activities

Interest coverage ratio:
Cash flows from operating activities / interest payments
1. All indices based on consolidated financial figures.
2. Aggregate market value of common stock:Market price at the period-end x number of shares outstanding at the period-end (excluding treasury stock)
3. Cash flows from operating activities corresponds to the cash flow from operating activities in the consolidated statement ofcash flows. Interest-bearing liabilities include all liabilities reported on the consolidated balance sheet for which the Group ispaying interest. Interest payments correspond to the interest paid in the consolidated statement of cash flows.
(4) Outlook
Regarding the forecast for the current fiscal year, the Japanese economy is expected to continue to gradually recover. Overseas,
the world economy is expected to remain firm overall despite concerns about the risk of a slump that have been prompted
mainly by shifting policies in the United States and international trade friction.

In light of these economic conditions, the Group is forecasting consolidated net sales of ¥61.0 billion,
operating profit of ¥5.5 billion, ordinary profit of ¥5.4 billion and profit attributable to owners of parent of ¥3.8 billion forthe year ending March 31, 2019.

7

The fiscal year 2018

(5) Fundamental Earnings Distribution Policy and Dividends for the Current and Next Fiscal Periods
With regard to the distribution of profits, Nippon Thompson Co., Ltd. (the “Company”) positions the return of profits toshareholders as one of its major management issues, having as its basic policy continuing stable dividends while taking
performance levels into overall consideration.
In addition, while giving heed to such factors as the future business environment, the Group intends to retain
sufficient internal reserves. Specifically in this regard, the Group works to strengthen its management base and improveearnings power to maximize corporate value. Simultaneously, it reviews production systems that respond to rapid technologicalinnovation and fluctuating demand and makes such investments as new product development.
In keeping with the basic policy and as a result of a general review of, for example, the level of performance over the
fiscal year and internal reserves, the Company plans a year-end dividend of ¥6.5 per share. Including the interim dividend of¥6.5 per share, the planned full-year dividend payment ¥13 per share.
The Company is forecasting a dividend of ¥15 per share (including an interim dividend of ¥7.5 per share) for the
fiscal year ending March 31, 2018.

8

The fiscal year 2018

6. Status of the GroupThe Group is composed of the Company and its subsidiaries, and engages in the manufactures and sells Needle Roller
Bearings, Linear Motion Rolling Guides and Machine Components.
The Group’s business is outlined in the following diagram.

Customers
Products
Sales(Domestic)
Consolidated Subsidiary:
Nippon Dic Co., Ltd.

Products

Non – Consolidated Company:
Hassei Shokai Co., Ltd.
(Overseas)
Consolidated Subsidiaries:
IKO International, Inc.
Nippon Thompson Europe B.V.
IKO - Thompson (Shanghai) Ltd.
IKO Thompson Asia Co., Ltd.

Products

Sales(Overseas)
Consolidated Subsidiary:
UBC (Shanghai) Precision Bearing
Manufacturing Co., Ltd.

Non – Consolidated Companies:
IKO Thompson Korea Co., Ltd.
IKO Thompson Brazil Service Co., Ltd.
IKO Thompson Bearings Canada, Inc.

Products

Products

Production(Overseas)
Consolidated Subsidiary:
UBC (Suzhou) Bearing Co., Ltd.

Nippon Thompson Co., Ltd.
Process and Products
Production(Domestic)
Non – Consolidated Companies:
Shinmie Seiko Co., Ltd.
Nagahara Seiko Co., Ltd.

Service(Domestic)
Non – Consolidated Company:
Gokurakuji Kosan Co., Ltd.

(Overseas)
Consolidated Subsidiary:
IKO Thompson Vietnam Co., Ltd.

Products

Production
OEM

9The fiscal year 2018

7. Management Policies(1) Fundamental Management Policies
Based on the corporate philosophy of “contributing to society as an R&D-oriented company,” the Group —a trusted
international enterprise—is committed to serving domestic and overseas markets through the manufacture and sale of Needle
Roller Bearings and Linear Motion Rolling Guides. Our emphasis is on quality rather than scale, as we see our mission as
developing high-value-added products that meet customer needs. The entire company is engaged in an effort to associate the
Nippon Thompson brand with the acronym IKO—“I” for Innovation, because the Company’s products are always innovative;“K” for Know-how, because they incorporate a high level of technological expertise; and “O” for Originality, because they arehighly creative.
The Group believes that contributing to the development of society is one of its most important management
policies. While thoroughly instilling corporate ethics, we make every effort to ensure compliance in management and contributeto the preservation of the global environment. Our corporate activities take into account this social mission.

(2) Management Targets and Performance Indicators
Raising shareholder return on equity (ROE), in an effort to maximize shareholder value, is the principal indicator for the Group.
Management also focuses on improving cash flows to enhance stability and to strengthen the Group’s financial position.

(3) Medium-Term Management Strategies
Through the manufacture and sale of bearings and other products, the Group aims to reinforce its reputation of trustworthinessand dependability in the global market while further strengthening its presence and achieving continuous growth. Accordingly,
we have formulated “IKO Mid-term business plan 2020 (three-year plan) CHANGE & CHALLENGE: Next
Stage—ACCOMPLISH—.” Aiming to achieve sustained growth and reinforce our earnings structure, we will focus ourmanagement resources on nurturing key fields with high growth and earnings potential. We will continue to provide the world
with high added value by developing products and services that take maximum advantage of the Group’s core technologies.

(4) Issues to Be Resolved
The main businesses of the Group are expected to experience a steady increase in demand from various sectors, centered on themachine tools and semiconductor manufacturing equipment industry. This forecasted rise in demand is attributable to the global
growth of the machinery and electronics industry. In step with worldwide trends toward the prevention of global warming, theCompany’s products, which meet the need for compact, power-saving machinery, are present in business fields that possess
growth potential.
The Group will respond flexibly to changes in the businesses environment while conducting focused investment ofmanagement resources based on careful analysis of the abovementioned promising markets and implementing a range ofmeasures to heighten its global competitiveness.
From the sales perspective, the Group will establish a marketing framework that can offer solutions through10The fiscal year 2018

cooperation between the technical, production, and administrative departments as well as the Sales Department based on
assessments of customers’ problems and aspirations. We aim to be a company that customers are comfortable approachingdirectly for consultation. In particular, as the switch to IoT and smart factories accelerates, market needs are growing more
complex and varied. In response, we will increase the added value provided to customers by enhancing our ability to offer
solutions using unit products. In addition, we will promote the technical capabilities of the IKO brand in new andunconventional ways and work to raise awareness of these capabilities on the global market. We will continue to build aframework that can more efficiently and effectively expand sales.
Regarding product development, amid an era of economic and social structural change driven by technologicalprogress, including IoT, big data, AI, and robots, the Group is providing new value to society through product development
focused on exploring new fields with an eye toward open innovation involving industry, academia, and government agencies.
We share our customers’ values and strive to address the specific needs of communities around the globe. We will continue
working to develop markets and products from the customers’ point of view using the Group’s advance technical skills.
Turning to production activities, the Group will earnestly promote manufacturing reforms and work to improve
processes, promote automation, and establish new methods with the aim of ensuring our ability to produce and supply products
in a steady, timely manner in line with Companywide marketing strategies. As for materials and components, in addition to
implementing optimal global procurement, we have begun to carry out fundamental reforms from upstream processes and areboosting the effects of those reforms. By manufacturing in optimal locations that best utilize each domestic and overseas
production base’s strengths and accurately assigning roles, we will continue working to enhance our competitiveness in termsof quality, price, and delivery time.

8. Basic Stance on Selection of Accounting Methods

The Group applies “Japanese GAAP” to facilitate the comparison of consolidated financial statements with different reporting
periods.
As for the adoption of “International Financial Reporting Standards (IFRS)”, the Group maintains a policy ofcontinuing to appropriately respond to the situation going forward.

11

The fiscal year 2018

9. Consolidated Financial Statements
Consolidated Balance Sheets
As of March 31, 2018 and 2017
Millions of yen
March 31,
March 31,
2017
2018

ASSETS
Current Assets:
Cash and deposits
Notes and accounts receivable-tradeFinished products
Material in process
Raw material
Deferred tax assets
OthersLess: Allowance for doubtful accounts
Total current assets
Fixed Assets:
Tangible fixed assets:
Buildings and structures
Machinery and vehicles
Tools and fixtures
Land
Lease assets
Construction in progress
Total tangible fixed assets
Intangible fixed assets:
Goodwill
OthersTotal intangible fixed assets
Investments and other assets:
Investment securities
OthersLess: Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
TOTAL ASSETS

12

18,104
16,373
11,734
8,713
5,095
1,687
1,301
(25)
62,984

20,24013,113
13,186
7,892
4,837
1,907
1,462
(11)
62,629

5,348
9,700
712
2,951
635
966
20,313

5,691
10,548
587
2,965
680
399
20,872

345
2,610
2,956

384
2,989
3,374

11,1192,511(48)
13,58236,851

10,4402,356(45)12,751
36,99899,836

99,627

The fiscal year 2018

Millions of yen
March 31,
March 31,
2017
2018

LIABILITIESCurrent Liabilities:
Notes and accounts payable-trade
Short-term loans payable
Current portion of bonds
Current portion of long-term loans payable
Lease obligations
Accrued expenses
Income taxes payable
Allowance for directors’ and corporate auditors’ bonuses
OthersTotal current liabilities

10,939
－
－
2,778
68
2,767
479
60
2,484
19,577

8,143
400
5,000
3,133
68
2,256
202
60
1,595
20,861Long-Term Liabilities:
Corporate bonds
Long-term loans payable
Lease obligations
Deferred tax liabilities
Net defined benefit liabilities
OthersTotal long-term liabilities

10,000
8,516
498
1,456
15
104
20,592

10,000
8,133
561
1,177
182
105
20,160TOTAL LIABILITIES

40,17041,021

Shareholders’ Equity:
Common stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity

9,533
12,88733,544(1,169)54,795

9,533
12,88732,801(801)
54,420

Accumulated Other Comprehensive Income:Net unrealized holding gains on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Subscription rights to shares
Non-controlling interests

4,450
0
(154)
125
4,422
76
372

3,975
6
(104)
(82)
3,795
30
359

TOTAL NET ASSETS

59,66658,605TOTAL LIABILITIES AND NET ASSETS

99,836

99,627NET ASSETS

13

The fiscal year 2018

Consolidated Statements of Income
Years ended March 31, 2018 and 2017
Millions of yen
March 31,
March 31,2017
2018
Net Sales
Cost of Sales
Gross Profit
Selling, General and Administrative Expenses

55,22839,401
15,826
13,177

44,13031,206
12,924
11,778Operating Profit

2,649

1,145

14
199
75
162
452

14
199
0
173
388

129
233
44
239
57
704

123
139
37
240
88
628

2,397

905

39
250
289

－
－
－

197
197

－
－

2,489

905

597
217
815
1,674
(4)
1,678

134
1,050
1,184
(278)
12
(291)

Non-Operating Income:Interest income
Dividend income
Insurance income
Others
Non-Operating Expenses:
Interest expenses
Sales discounts
Loss on retirement of fixed assets
Foreign exchange losses
OthersOrdinary Profit
Extraordinary income:Gain on sales of fixed assets
Compensation for transfer
Extraordinary Losses:
Dismantlement expenses

Profit Before Income Taxes
Income Taxes:
Current
DeferredProfit (loss)
Profit (loss) attributable to non-controlling interests
Profit (loss) attributable to owners of parent

14

The fiscal year 2018

Consolidated Statements of Comprehensive Income
Years ended March 31, 2018 and 2017
Millions of yen
March 31,
March 31,2017
2018
Profit (loss)
Other Comprehensive Income:Net unrealized holding gains on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total Other Comprehensive Income
Comprehensive Income
Breakdown:Comprehensive income attributable to owners of the parent
Comprehensive income attributable to non-controlling interests

15

1,674

(278)

474
(6)
(32)
207
643
2,317

1,797
11
(266)
85
1,627
1,348

2,304
12

1,334
13

The fiscal year 2018

Statement of Changes in Consolidated Shareholders’ Equity
For the fiscal year ended March 31, 2018
(Millions of yen)
Shareholders’ Equity
CapitalSurplus

Common stock
As of April 1, 2017
Changes during the period
Cash dividends

Treasury stock

Total
shareholders’equity9,533

12,88732,801(801)

54,420

－

－

(935)

－

(935)

－

－

1,678

－

1,678

－

－

－

(420)

(420)

－

－

－

51

51

－

－

－

－

－

－
9,533

－
12,887742
33,544(368)(1,169)374
54,795

Profit attributable to ownersof parent
Acquisition of treasury
stock
Disposal of treasury stock
Net changes in items otherthan shareholders’ capital
Total changes during the period
As of March 31, 2018

Retainedearnings

Accumulated other comprehensive income
Net unrealized
holding gains
onavailable-forsale securities

Deferred
gains or losses
on hedges

Foreigncurrencytranslation
adjustments

Remeasurements ofdefinedbenefit plans

Total
Accumulated
othercomprehensive
incomeSubscription
rights toshares

Noncontrollinginterests

3,975

6

(104)

(82)

3,795

30

359

58,605

Cash dividends

－

－

－

－

－

－

－

(935)

Profit attributable toowners of parent
Acquisition oftreasury stock
Disposal of treasurystock
Net changes in items
other thanshareholders’ capital
Total changes during theperiod

－

－

－

－

－

－

－

1,678

－

－

－

－

－

－

－

(420)

－

－

－

－

－

－

－

51

474

(6)

(49)

207

626

46

12

685

474

(6)

(49)

207

626

46

12

1,060

4,450

0

(154)

125

4,422

76

372

59,666

As of April 1, 2017Total
net assets

Changes during theperiodAs of March 31, 2018

16

The fiscal year 2018

For the fiscal year ended March 31, 2017
(Millions of yen)
Shareholders’ Equity
CapitalSurplus

Common stock
As of April 1, 2016
Changes during the period
Cash dividends

Treasury stock

Total
shareholders’equity9,533

12,88734,034(620)

55,833

－

－

(941)

－

(941)

－

－

(291)

－

(291)

－

－

－

(280)

(280)

－

－

(0)

99

99

－

－

－

－

－

－
9,533

－
12,887(1,232)32,801

(180)
(801)

(1,413)54,420Loss attributable to ownersof parent
Acquisition of treasury
stock
Disposal of treasury stock
Net changes in items otherthan shareholders’ capital
Total changes during the period
As of March 31, 2017

Retainedearnings

Accumulated other comprehensive income
Net unrealized
holding gains
onavailable-forsale securities

Deferred
gains or losses
on hedges

Foreigncurrencytranslation
adjustments

Remeasurements ofdefinedbenefit plans

Total
Accumulated
othercomprehensive
incomeSubscription
rights toshares

Noncontrollinginterests

2,177

(4)

163

(167)

2,169

18

35

58,056

Cash dividends

－

－

－

－

－

－

－

(941)

Loss attributable toowners of parent
Acquisition oftreasury stock
Disposal of treasurystock
Net changes in items
other thanshareholders’ capital
Total changes during theperiod

－

－

－

－

－

－

－

(291)

－

－

－

－

－

－

－

(280)

－

－

－

－

－

－

－

99

1,797

11

(268)

85

1,626

11

324

1,962

1,797

11

(268)

85

1,626

11

324

549

3,975

6

(104)

(82)

3,795

30

359

58,605

As of April 1, 2016

Total
net assets

Changes during theperiodAs of March 31, 201717

The fiscal year 2018

Consolidated Statements of Cash Flows
Years ended March 31, 2018 and 2017
Millions of yen
March 31,2018

March 31,2017

Cash Flows from Operating Activities:
Profit before income taxes

2,489

905

Depreciation and amortization

3,094

2,596

Increase (Decrease) in allowance for doubtful accounts

18

(4)

Increase (Decrease) in allowance for directors’ andcorporate auditors’ bonuses

－

(10)

Decrease in net defined benefit liabilities

(184)

(255)

Interest and dividend income

(214)

(214)

Interest expenses

129

123

Loss on retirement of fixed assets

44

37

Compensation for transfer

(250)

－

Dismantlement expenses

197－(3,196)(2,264)

Decrease (Increase) in inventories

410

2,984

Decrease (Increase) in other accounts receivable
Increase (Decrease) in notes and accounts
payable-trade
Increase (Decrease) in accrued expenses

(107)

329

2,704

686

326

(133)

Others-net

228

552

Subtotal

5,688

5,333

Interest and dividend income received

214

214

Interest expenses paid

(139)

(114)

Proceeds from compensation for transfer

250－

Income taxes refund(paid)

29

(451)

6,043

4,981

Decrease (Increase) in notes and accounts
receivable-trade

Net cash provided by operating activities

18

The fiscal year 2018

Millions of yen
March 31,2018

March 31,2017

Cash Flows from Investing Activities:
Payments into time deposits

(83)

(247)

Proceeds from time deposits

201

571

Payments for purchase of property,
plant and equipment(1,539)(3,756)

Payments for purchase of intangible assets

(143)

(439)

Payments for purchase of investment securities

(18)

(17)

Payments for purchase of insurance funds

(260)

(268)

Proceeds from cancellation of insurance funds

532－

Purchase of shares of subsidiaries resulting inchange in scope of consolidation－(1,211)Others-net

(68)

(6)

(1,379)(5,376)

Increase in short-term loans payable

2,500

1,800

Decrease in short-term loans payable(2,897)(1,800)

Proceeds from long-term loans payable

3,420

7,098

Repayments of long-term loans payable(3,391)(3,818)－10,000(5,000)－－(4,999)Cash dividends paid

(935)

(941)

Payments for purchase of treasury stock

(420)

(280)

28

67

(6,696)

7,126

11

(78)

Net increase (decrease) in cash and cash equivalents(2,020)

6,653

Cash and cash equivalents at beginning of year

20,04013,386

Cash and cash equivalents at end of year

18,01920,040Net cash used in investing activities
Cash Flows from Financing Activities:

Proceeds from issuance of bonds
Redemption of bonds
Redemption of convertible bonds with subscription rights to shares

Others-net
Net cash provided by (used in) financing activities
Effect of exchange rate change on
cash and cash equivalents

19

The fiscal year 2018

10. Notes(Notes on the Premise of a Going Concern)
There are no applicable articles.

(Additional Information)(Accounting procedures for the ESOP trust)At the Board of Directors meeting held on February 13, 2018, and it was decided that the employee incentive plan, an ESOP
trust, would be re-introduced. The aim of this re-introduction is to further enhance the employee benefits system, which
supports the growth of the Company. We also aim to improve medium- to long-term corporate value and raise awarenessamong employees of the Company’s business performance and share price by providing incentives to raise the share price.
Furthermore, the ESOP trust that was introduced in February 2013 was closed on March 14, 2018, the end date of
the trust designated upon its introduction.

(1) Outline of Trades
The ESOP trust (hereafter referred to as the Trust Account) was established by the Company to cover employees enrolled
in the Company’s Stock Ownership Association who fulfill certain criteria for becoming beneficiaries. Within apredetermined acquisition period, the Trust Account acquires shares of treasury stock in a number equivalent to that which
the Company’s Stock Ownership Association expects to acquire over the five years, and then sells on said stock to theCompany’s Stock Ownership Association on a set day every subsequent month. At the end of the term of the trust, if theTrust Account records a profit due to higher share prices, this profit shall be distributed to the beneficiaries in proportion totheir individual contributions. If the Trust Account records a loss on transfer due to lower share prices and debt is incurredon trust assets, no additional burden will be imposed on employees as the Company will repay the bank in one lump sumin accordance with the warranty of the loan agreement.

(2) Treasury Shares Remaining in the Trust
Shares of the Company remaining in the trust are recorded as treasury shares under net assets at carrying value (net of
associated costs) . The carrying value and number of such treasury shares were ¥48 million and 113,000 shares
respectively at March 31, 2017 and ¥416 million and 480,000 shares respectively at March 31, 2018.

(3) Carrying Value of Loans Recorded through Application of the Gross Price Method
As of March 31, 2017: ¥66 million; As of March 31, 2018: ¥420 million

20

The fiscal year 2018

(Statement of Changes in Consolidated Shareholders’ Equity)
For the fiscal Year ended March 31, 2018
1. Class and Number of Shares Issued
Increased shares
As of April 1, 2017
during the fiscal year
(Shares)(Shares)Common stock－
73,501,425

Decreased shares
during the fiscal year
(Shares)－

As of March 31, 2018
(Shares)

73,501,425

2. Class and Number of Treasury stock
Increased shares
Decreased shares
As of March 31, 2018
during the fiscal year
during the fiscal year
(Shares)(Shares)(Shares)Common stock
1,638,790
484,842
118,100
2,005,532
Notes: 1. The 480,100 shares held by the ESOP trust are included in treasury stock at March 31, 2018.
Notes: 2. The increase of 342 shares of treasury stock is due to purchase of odd lot shares of less than one trading unit.
Notes: 3. The increase of 484,500 shares of treasury stock is due to purchase of treasury stock by the ESOP trust.
Notes: 4. The decrease of 118,100 shares of treasury stock is due to sales of shares by the ESOP trust to the Employee
Stock Ownership Association.
As of April 1, 2017
(Shares)

3.Subscription rights
Type ofsharesBreakdown ofsubject to
subscription rights
subscription
rightsStock Options as
The
Subscription
Company
Rights
Total－

Number of shares subject to subscription rights (Shares)

Balance as ofMarch
31,2018(Millions of
yen)

As of
April 1, 2017

Increasedsharesduring the
fiscal year

Decreasedsharesduring the
fiscal year

As of March
31, 2018

－

－

－

－

76

－

－

－

－

76

4. Dividend(1) Dividend Paid
Resolution

Class of
Stock

Ordinary general meetingof shareholders on
June 29, 2017

Common stock

Board of directors on
November 6, 2017

Common stock

Dividend per
share
(Yen)

Recorddate

Effective
Date

467

6.50

March 31,2017

June 30,
2017

467

6.50

September 30,
2017

December 6,
2017

Total Dividend(Millions of yen)

Notes: 1. Total dividends, based on a resolution at the ordinary general meeting of shareholders held on June 29, 2017, include
Notes: ¥0 million to be paid as dividends on the 113,700 shares of treasury stock held to date by the ESOP trust.
Notes: 2. Total dividends, based on a resolution at a meeting of Board of Directors held on November 6, 2017, include
Notes: ¥0 million to be paid as dividends on the 43,000 shares of treasury stock held to date by the ESOP trust.

21

The fiscal year 2018

(2) Dividend with a record date that falls within the current fiscal period under review and an effective date in the following
fiscal period
Dividend perClass ofResource
Total DividendRecordEffective
Resolution
share
stock
of dividend (Millions of yen)
date
Date
(Yen)
Ordinary general meeting
Common Retained
March 31,
June 29,of shareholders on
467
6.50
stock
earnings
2018
2018
June 28, 2018
Note: Total dividends include ¥3 million to be paid as dividends on the 480,100 shares of treasury stock held to date by
the ESOP trust.

For the fiscal Year ended March 31, 2017
1. Class and Number of Shares Issued
As of April 1, 2016
(Shares)Common stock

73,501,425

Increased shares
during the fiscal year
(Shares)－

Decreased shares
during the fiscal year
(Shares)－

As of March 31, 2017
(Shares)

73,501,425

2. Class and Number of Treasury stock
Increased shares
Decreased shares
As of March 31, 2017
during the fiscal year
during the fiscal year
(Shares)(Shares)(Shares)Common stock
1,140,077
730,513
231,800
1,638,790
Notes: 1. The 113,700 shares held by the ESOP trust are included in treasury stock at March 31, 2017.
Notes: 2. The increase of 513 shares of treasury stock is due to purchase of odd lot shares of less than one trading unit.
Notes: 3.The increase of 730,000 shares of treasury stock is due to acquisition of treasury stock based on a resolution passed
at a meeting of Board of Directors.
Notes: 4. The decrease of 7,500 shares of treasury stock is due to exercise of the share option rights.
Notes: 5. The decrease of 224,300 shares of treasury stock is due to sales of shares by the ESOP trust to the Employee
Stock Ownership Association.
As of April 1, 2016
(Shares)

22

The fiscal year 2018

3.Subscription rights
Type ofsharesBreakdown ofsubject to
subscription rights
subscription
rightsNumber of shares subject to subscription rights (Shares)
As ofApril 1, 2016

Increasedsharesduring the
fiscal year

Decreasedsharesduring the
fiscal year

As of March
31, 2017

Balance as ofMarch
31,2017(Millions ofyen)

Second Series ofUnsecured
Convertible
Bonds with
Common7,750,387－
7,750,387－
Note
Subscription
stock
The
RightsCompany(Issued April 19,
2011)
Stock Options as
Subscription
－
－
－
－
－
30
RightsTotal
7,750,387－
7,750,387－
30
Notes: 1. The total amount of convertible bonds with subscription rights shall be recorded as liabilities at the time of issuancepursuant to the issuance of straight bonds.
2. The decrease of 7,750,387 shares of treasury stock is due to redemption of convertible bonds with subscription rights.
4. Dividend(1) Dividend Paid
Total Dividend(Millions of yen)

Dividend per
share
(Yen)

Recorddate

Effective
Date

Resolution

Class of
Stock

Ordinary general meetingof shareholders on
June 29, 2016

Common stock

472

6.50

March 31,2016

June 30,
2016

Board of directors on
November 7, 2016

Common stock

468

6.50

September 30,
2016

December 7,
2016

Notes: 1. Total dividends, based on a resolution at the ordinary general meeting of shareholders held on June 29, 2016, include
Notes: ¥2 million to be paid as dividends on the 338,000 shares of treasury stock held to date by the ESOP trust.
Notes: 2. Total dividends, based on a resolution at a meeting of Board of Directors held on November 7, 2016, include
Notes: ¥1 million to be paid as dividends on the 207,400 shares of treasury stock held to date by the ESOP trust.
(2) Dividend with a record date that falls within the current fiscal period under review and an effective date in the following
fiscal period
Dividend perClass ofResource
Total DividendRecordEffective
Resolution
share
stock
of dividend (Millions of yen)
date
Date
(Yen)
Ordinary general meeting
CommonRetained
March 31,
June 30,of shareholders on
467
6.50
stock
earnings
2017
2017
June 29, 2017
Note: Total dividends include ¥0 million to be paid as dividends on the 113,700 shares of treasury stock held to date by
the ESOP trust.

23

The fiscal year 2018

(Consolidated Statements of Cash Flows)
1. Relationship between cash and cash equivalents year ended and the amount of the account stated in the consolidated balance
sheetsMillions of yen
March 31,
March 31,2017
2018
Cash and deposits
20,24018,104
Time deposits with maturity exceeding three months
(200)
(84)
Cash and cash equivalents at end of year
20,04018,0192. Major non-cash transactions
Assets and liabilities related to finance leases are as follows.

Millions of yen
March 31,
2018
814
566

Assets related to finance leases
Liabilities related to finance leases

March 31,
2017
814
629

(Business combination related data)
Business combination through acquisition
1. Confirmation of temporary accounting procedures related to business combinations
Regarding the business combination of UBC (Shanghai) Precision Bearing Manufacturing Co., Ltd. and UBC (Suzhou)
Bearing Co., Ltd., which was executed on January 13, 2017, the temporary accounting procedures that were used in theprevious fiscal year have been confirmed for the fiscal year under review.
In addition, no revisions have been made to the amount of goodwill.
2. Amount of goodwill recognized and related matters(1) Amount of goodwill recognized¥384 million(2) Reason for recognition
In light of the acquired businesses’ expected excess earnings power in the context of future business expansion, goodwill
has been recognized.
(3) Amortization method and period
The straight-line method over a decade.

(Segment Information)
Because the Group manufactures and sells Needle Roller Bearings, Linear Motion Rolling Guides and Machine
Components on an integrated basis, the disclosure of segment information has been omitted.

24

The fiscal year 2018

(Per Share Information)

Yen
March 31,
March 31,20172018
Net assets per share810.11828.26
Earnings per share(4.04)
23.35
Diluted earnings per share－
23.30
Notes: 1. Diluted earnings per share for the fiscal year ending March 31, 2017 has not been recorded, because,
although there are residual securities, the Group posted a net loss per share.
Notes: 2. Basis for calculations of earnings per share and diluted earnings per share is as follows.
Millions of yen

Earnings per share
Profit (loss) attributable to owners of parent
Value not attributed to common stock
Profit (loss) attributable to owners of parent pertaining tocommon stock
Average number of shares outstanding at period-end
Diluted earnings per share
Adjustment value of profit attributable to owners of parent
Increase in number of shares outstanding(of which subscription rights to shares)
Residual shares not included in the calculation of diluted net
income per share because they have no dilutive effect

March 31,2018

March 31,
2017

1,678
－

(291)
－

1,678

(291)

71,886,988shares

72,077,206shares－
144,828(144,828)

－
－
－

－

－

Notes: 3. With regard to the computation of the number of shares outstanding at period-end, which is used to determine net
assets per share, and the average number of shares outstanding at period-end, which is used to determine earnings
per share for the period , the shares held by the ESOP trust are included in treasury stock.

(Important Subsequent Events)
There are no applicable articles.

25