FR OM APR IL 1S T, 2019 TO M A RC H 3 1ST, 2020

CONTENTS
Ⅰ. SUMMARY OF OPERATING RESULTS BY BUSINESS
Review of Operations

１

Ⅱ. FINANCIAL HIGHLIGHTS
１. Consolidated Financial Highlights

２

２. Non-Consolidated Financial Highlights

３

Ⅲ. FINANCIAL SECTION
Financial Summary

４

１．Consolidated Financial Statements（１）Consolidated Statement of Financial Position

５（２）Consolidated Statement of Income７７（３）Consolidated Statement of Comprehensive Income

８（４）Consolidated Statement of Changes in Equity

９（５）Consolidated Statement of Cash Flows

１１

Notes to Consolidated Financial Statements

１２

Ⅳ. OUTLINE OF THE COMPANY

５２

Ⅴ. PROFILE OF THE GROUP COMPANIES

５５Ⅵ. OWNERSHIP OF THE COMPANY’S SHARES

５７

Ⅶ. BOARD OF DIRECTORS AND AUDIT AND SUPERVISORYCOMMITTEE MEMBERS

５８

Ⅰ. SUMMARY OF OPERATING RESULTS BY BUSINESSAs of March 31, 2020

Review of Operations● Instruments revenue
Revenue for instruments decreased by 6.5% to ¥192,798 million from the previous fiscal year, mainly due
to a decrease in orders for instruments for automobiles in America, Europe and Asia.

● Components revenue
Revenue for components decreased by 1.8% to ¥15,172 million from the previous fiscal year, mainly due toa decrease in orders for liquid crystal display products while orders for Control panels for office equipment
increased.

● Automobile revenue
Revenue for cars at our dealerships decreased by 9.5% to ¥22,226 million from the previous fiscal year,
mainly due to a decrease in orders for new cars.

● Other businesses
Revenue for other products and services decreased by 5.0% to ¥16,142 million from the previous fiscal year,
mainly due to a decrease in orders for compound resins.

As a result, the company’s consolidated business operations for this fiscal year, ending March 31, 2020,
resulted in revenue of ¥246,340 million, a decrease of 6.4% from the previous fiscal year. Operating profit
for the year decreased by 46.0% to ¥7,669 million, and loss attributable to owners of the parent for the year
was ¥350 million, mainly due to reversing ¥2,834 million of deferred tax assets and recording it ascorporate income tax expense while profit attributable to owners of the parent for the previous year was¥11,569 million.

● Consolidated revenue by business segment
2018(Yen in millions)

2019(Yen in millions)

2020(Yen in millions)

Increase(Decrease)

Instruments for automobiles,
motorcycles, agricultural /construction machines andboats

206,422

206,237

192,798(6.5%)

Components

17,564

15,454

15,172(1.8%)

Automobiles

22,826

24,56322,226(9.5%)

Other businesses

16,351

16,983

16,142(5.0%)

Total

263,163

263,239

246,340(6.4%)1

Ⅱ. FINANCIAL HIGHLIGHTS

As of March 31, 2020

1. Consolidated Financial Highlights
1 – 1. Revenue

Yen in billions

Note:※ NIPPON SEIKI CO., LTD. changed business segment from “Consumer-use products” to“Components” from fiscal year ending March 31, 2019. However, in the above table, Components
has been used since 2018 for the purpose of reference.
1 – 2. Consolidated Profit attributable to owners of the parent

Yen in billions

Consolidated revenue for the fiscal year ending March 31, 2020 decreased by 6.4% to ¥246,340 million.
Operating profit decreased by 46.0% to ¥7,669 million and loss attributable to owners of the parent for the year
was ¥350 million while profit attributable to owners of the parents for the previous year was ¥11,569 million.

1 – 3. Consolidated Financial Highlights
2018

2019

2020

Revenue (Yen in millions)263,163

263,239

246,340

Operating profit (Yen in millions)

14,10914,215

7,669

Profit attributable to owners of parent(Yen in millions)11,105

11,569(350)

Basic earnings per share ※193.94202.03(6.13)

Total assets (Yen in millions)

298,132

307,665

296,987

Total equity (Yen in millions)

176,281

186,447

174,828

Equity per share attributable toowners of the parent (Yen)

2,975.34

3,142.61

2,943.20

Note:※ Basic earnings per share is calculated by the weighted average number of shares of common
stock outstanding during the year.
2２. Non-Consolidated Financial Highlights

As of March 31, 2020
Yen in billions

2 – 1. Non-Consolidated SalesNote:※ NIPPON SEIKI CO., LTD. changed business segment from “Consumer-use products” to“Components” from fiscal year ending March 31, 2019. However, in the above table, Components
has been used since 2018 for the purpose of reference.
Yen in billions

2 – 2. Non-Consolidated Profit for the year
5 .39

16/17

4 .55

17/18

2 .10

18/19

1 .35

19/20

0

1

2

3

4

5

6

7

8

Non-Consolidated sales for the fiscal year ending March 31, 2020 decreased by 5.6% to ¥115,086 million.
Ordinary income decreased by 83.3% to ¥1,004 million and profit for the year decreased by 35.4% to ¥1,356
million.

2 – 3. Non-Consolidated Financial Highlights
2017

2018

2019

2020

Sales (Yen in millions)

117,415

120,752

121,937

115,086

Ordinary income (Yen in millions)

10,266

6,530

6,014

1,004

Profit for the year (Yen in millions)

5,392

4,558

2,101

1,356

Earnings per share (Yen) ※

94.18

79.60

36.69

23.68

Dividend per share (Yen)

35.00

42.00

45.00

40.00

Total assets (Yen in millions)

205,595

202,863

203,580

199,230

Net assets (Yen in millions)

90,43994,05591,28488,027

Common stock (Yen in millions)

14,494

14,494

14,494

14,494

43.9

46.3

44.7

44.1

Equity ratio (%)

Note:※ Earnings per share is calculated by the weighted average number of shares of common stock
outstanding during the year.
3

Ⅲ. FINANCIAL SECTION
Financial Summary
Accounting standards
Fiscal year end
Revenue(Millions of yen)
Profit before tax(Millions of yen)
Profit (loss) attributable to owners of theparent (Millions of yen)Comprehensive income attributable toowners of the parent (Millions of yen)

IFRS (International Financial Reporting Standards)
April 1, 2016
(Transition date)

March 31,2017

March 31,2018

March 31,2019

March 31,2020－

245,967

263,163

263,239

246,340－

15,35615,854

16,291

7,566－

10,164

11,105

11,569(350)－

10,341

7,938

12,144(9,058)

156,649

164,500

170,381

179,969

168,601

296,127

293,279

298,132

307,665

296,987

2,735.44

2,873.05

2,975.34

3,142.61

2,943.20－

177.51

193.94202.03(6.13)－

177.27193.67201.74(6.13)

52.90

56.09

57.15

58.50

56.77

－

6.33

6.63

6.60

(0.20)

－

13.49

9.96

8.86

－

－

16,504

22,522

16,815

16,845－(2,476)(13,263)(16,085)(18,321)－(16,388)(4,461)(1,314)(2,212)

41,54838,212

42,63742,12836,657

13,284

13,912

13,927

14,663

14,530Equity attributable to owners of theparent(Millions of yen)
Total assets(Millions of yen)
Equity per share attributable to owners of
the parent (Yen)
Basic earnings (losses) per share(Yen)
Diluted earnings (losses) per share(Yen)
Equity attributable to owners of theparent ratio(%)
Return on equity attributable to owners of
the parent(%)
Price-to-earnings ratio(Times)Net cash provided by operating activities(Millions of yen)
Net cash used in investing activities(Millions of yen)
Net cash used in financing activities(Millions of yen)
Cash and cash equivalents at end of year
(Millions of yen)
Number of employees(Note)
1. NIPPON SEIKI CO., LTD. and its subsidiaries in Japan and overseas have adopted International Financial ReportingStandards ("IFRS") and prepared the consolidated financial statements from the fiscal year ending March 31, 2018.

2. Consumption tax and other taxes are not included in revenue.
4

1 【Consolidated Financial Statements】(1)【Consolidated Statement of Financial Position】
Notes

March 31,2019

March 31,2020

AssetsCurrent assets
Cash and cash equivalents

7,27

42,12836,657

Trade and other current receivables

8,27

48,038

38,117

Other current financial assets

9,27

68,11369,668Inventories

1046,47543,934

Other current assets

6,575

7,150

Total current assets

211,331

195,528

Non-current assets
Property, plant and equipment

11,13,28

63,22871,034

Goodwill and intangible assets

12,13

7,010

7,923

Trade and other non-current receivables

8,27

170

451

Other non-current financial assets

9,27

21,965

18,959Deferred tax assets

14

2,922

2,211

1,036

877

96,334

101,458

307,665

296,987

Other non-current assets
Total non-current assets
Total assets

5NotesMarch 31,2019

March 31,2020

Liabilities and equity
Liabilities
Current liabilities
Trade and other current payables

15,27

42,83734,519

Short-term loans

16,27

48,261

50,382Other current financial liabilities

9,27,28

197

1,976

1,966

2,234

Income tax payables
Short-term employee benefits

18

4,706

4,555

Provisions

17

2,874

2,188

Other current liabilities

1,226

1,156

Total current liabilities

102,070

97,013

13,111

13,562

Non-current liabilities
Long-term loans

16,27

Other non-current financial liabilities

9,27,28

578

4,266

Long-term employee benefits

18

3,402

3,526

Provisions

17

70

72

Deferred tax liabilities

14

1,563

3,316

421

401

Other non-current liabilities
Total non-current liabilities
Total liabilities

19,14725,145

121,217

122,158

14,494

14,494EquityCommon stock
Capital surplus

6,068

6,056

Retained earnings

162,106

159,508

Treasury stock(6,320)(6,289)Other components of equity

3,620(5,167)

179,969

168,601

6,478

6,227

186,447

174,828

307,665

296,987

Equity attributable to owners of the parent
Non-controlling interests
Total equity
Total liabilities and equity6

(2)【Consolidated Statement of Income】(Unit: Millions of yen)
Notes
RevenueYear ended March 31,201921

Cost of revenue
Gross profit

Year ended March 31,2020

263,239

246,340(217,644)(206,792)

45,59439,547(31,979)

Selling, general and administrative expenses

22(31,832)

Other income

23

1,099

1,170

Other expenses

23

(646)

(1,069)14,215

7,669

Operating profit
Finance income

24

2,654

3,047

Finance costs

24

(579)

(3,151)

16,291

7,566(3,869)(7,194)

12,421371

11,569(350)

Profit before tax
Income tax expense

14

Profit for the year
Profit attributable to:
Owners of the parent
Non-controlling interests

852

722

12,421371

25

202.03(6.13)

25

201.74(6.13)

Profit for the year
Earnings per share attributable to owners of theparent:Basic earnings (losses) per share(Yen)
Diluted earnings (losses) per share(Yen)7

(3)【Consolidated Statement of Comprehensive Income】(Unit: Millions of yen)
Notes

Year ended March 31,2019Year ended March 31,2020

12,421371(2,330)(2,019)30(27)(2,300)(2,047)2,874(7,235)

2,874(7,235)574(9,282)

12,996(8,910)12,144(9,058)

Profit for the year
Other comprehensive income
Items that will not be reclassified to profit or loss, netof tax:Gains(losses) on financial assets measured at fairvalue through other comprehensive income
Remeasurements of net defined benefit
liabilities(assets)
Total comprehensive income (loss) that will not bereclassified to profit or loss, net of tax

26

Items that may be reclassified to profit or loss, net oftax:
Foreign currency translation adjustments

26

Total comprehensive income (loss) that may bereclassified to profit or loss, net of tax
Other comprehensive income (loss) for the year

26

Total comprehensive income for the year
Comprehensive income attributable to:
Owners of the parent
Non-controlling interests
Comprehensive income for the year

8

851

147

12,996(8,910)(4)【Consolidated Statement of Changes in Equity】
For the year ended March 31, 2019
(Unit: Millions of yen)
Equity attributable to owners of the parent
Other components of equity
Notes

Commonstock

CapitalsurplusRetainedearnings

Gains (losses)
on financial
assets measured
at fair value
through othercomprehensive
incomeTreasurystockRemeasurementsof net defined
benefitliabilities(assets)

14,494

6,054

153,117(6,325)

8,687－

Profit for the year－－

11,569－－－Other comprehensive
income (loss)
Total comprehensive
income (loss)

－

－

－

－

(2,330)2－－

11,569－(2,330)

2

20

－

－

(2,576)

－

－

－

31

－

18

－

－

－

－

－

－

－

(0)

－

－

Disposal of treasury stock

－

(5)

－

5

－

－

Transfer from othercomponents of equity
to retained earnings

－

－

(5)

－

8

(2)

Other

－

－

1

－

－

－

Total transactions withowners－13(2,580)4

8(2)

14,494

6,068

162,106(6,320)6,364－

As of April 1, 2018
Comprehensive income

Transactions with owners
Dividends paid
Share-based paymenttransactions
Purchase of treasury
stock

As of March 31, 2019

Equity attributable to owners of the parent
Other components of equity
Notes

Foreigncurrencytranslation
adjustments

Total

Total equity
attributable toowners of theparentNon-controllinginterests

Total equity(5,646)3,040

170,381

5,899

176,281－－

11,569852

12,421

2,902

574

574

(0)

574

2,902

574

12,144851

12,99620－－(2,576)(274)(2,851)

31

－

－

18

－

18

－

－

(0)

－

(0)

Disposal of treasury stock

－

－

0

－

0

Transfer from othercomponents of equity
to retained earnings

－

5

－

－

－

Other

－

－

1

1

3

Total transactions withowners－5(2,556)(272)(2,829)(2,744)

3,620

179,9696,478

186,447

As of April 1, 2018
Comprehensive income
Profit for the year
Other comprehensive
income (loss)
Total comprehensive
income (loss)
Transactions with owners
Dividends paid
Share-based paymenttransactions
Purchase of treasury
stock

As of March 31, 20199

For the year ended March 31, 2020
(Unit: Millions of yen)
Equity attributable to owners of the parent
Other components of equity
Notes

Commonstock

CapitalsurplusRetainedearnings

Treasurystock

Gains (losses)
on financial
assets measured
at fair value
through othercomprehensive
incomeRemeasurements of
net defined
benefitliabilities(assets)

14,494

6,068

162,106(6,320)6,364－Profit for the year

－

－

(350)

－

－

－

Other comprehensive
income (loss)
Total comprehensive
income (loss)

－

－

－

－

(2,019)

(13)

－

－

(350)

－

(2,019)

(13)

20

－

－

(2,577)

－

－

－

31

－

18

－

－

－

－

－

－

－

(0)

－

－

Disposal of treasury stock

－

(30)

－

30

－

－

Transfer from othercomponents of equity
to retained earnings

－

－

80

－

(94)

13

Other

－

－

249

－

－

－

Total transactions withowners－(12)(2,246)

30

(94)

13

14,494

6,056

159,508(6,289)4,250－

As of April 1, 2019
Comprehensive income

Transactions with owners
Dividends paid
Share-based paymenttransactions
Purchase of treasury
stock

As of March 31, 2020

Equity attributable to owners of the parent
Other components of equity
Notes

Foreigncurrencytranslation
adjustments

Total

Total equity
attributable toowners of theparentNon-controllinginterests

Total equity(2,744)

3,620

179,9696,478

186,447

－

－

(350)

722

371

(6,674)(8,707)(8,707)(575)(9,282)(6,674)(8,707)(9,058)147(8,910)20－－(2,577)(389)(2,967)

31

－

－

18

－

18

－

－

(0)

－

(0)

Disposal of treasury stock

－

－

0

－

0

Transfer from othercomponents of equity
to retained earnings

－

(80)

－

－

－

Other

－

－

249

(9)

240

Total transactions with
Owners－(80)(2,309)(399)(2,708)(9,418)(5,167)

168,601

6,227

174,828

As of April 1, 2019
Comprehensive income
Profit for the year
Other comprehensive
income (loss)
Total comprehensive
income (loss)
Transactions with owners
Dividends paid
Share-based payment
Transactions
Purchase of treasury
Stock

As of March 31, 202010

(5)【Consolidated Statement of Cash Flows】(Unit: Millions of yen)
Notes

Year ended March 31,2019Year ended March 31,2020

Cash flows from operating activities:
Profit before tax

16,291

7,566

Depreciation and amortization

9,101

11,146

Impairment loss

327

344

(2,654)(3,047)

224

219

29

165

1,934

6,903

(Increase) decrease in inventories(5,684)(224)

Increase(decrease) in trade and other
Payables(1,060)(4,025)

Increase (decrease) in provisions
Increase (decrease) in retirement
benefit liabilities
Foreign exchange losses(gains)

(162)

(685)

0

213

431

1,112

Other, net(217)(1,893)

Subtotal

18,55917,796

Interest and dividends received

2,672

3,213

Interest paid

(226)

(221)

(3,303)(3,942)Other, net

(885)

－

Net cash provided by operating activities

16,815

16,845(Increase)decrease in time deposits, net(3,397)(3,435)Purchase of property, plant andequipment and intangible assets(13,121)(15,452)

431

218

(79)

(81)

7

181

(11)

(12)

Interest and dividends income
Interest expense(Gain) loss on sale of property,
plant and equipment(Increase) decrease in trade and otherReceivables

Income taxes paid

Cash flows from investing activities:

Proceeds from sale of property, plantand equipment and intangible assets
Purchase of investment securities
Proceeds from sale of investment
Securities
Increase in loans receivableCollection of loans

810

Other, net

78

249

Net cash used in investing activities(16,085)(18,321)

Cash flows from financing activities:(Decrease) increase in short-term loans,
Net
Proceeds from long-term loans

1,948

2,632

Repayments of long-term loans
Repayments of lease obligations

28

Dividends paid to non-controlling interests
Net decrease (increase) in treasury stock
Dividends paid to owners of the parent
Net cash used in financing activities
Foreign currency translation adjustments
on cash and cash equivalents
Net increase (decrease) in cash andcash equivalents
Cash and cash equivalents at
beginning of year
Cash and cash equivalents at end of year

4,000

4,000

(4,450)(4,000)(123)(1,861)

(112)

(407)

0

1

(2,575)(2,577)(1,314)(2,212)76(1,782)(508)(5,471)

7

42,63742,128

7

42,12836,65720

11

[Notes to Consolidated Financial Statements]
1. Reporting Entity
Nippon Seiki Co., Ltd. (hereinafter the “Company”) is a company incorporated in Japan. The consolidated financial
statements for the fiscal year ended March 31, 2020 consist of the financial statements of the Company and its consolidated
subsidiaries (hereinafter the “Group”).
The Group’s primary businesses are business of instruments for automobiles, motorcycles, agricultural / construction
machines, boats, business of component and business of automobile sales.
2. Basis of Preparation(1) Compliance with IFRSThe consolidated financial statements of the Group are prepared in accordance with International Financial ReportingStandards (hereinafter “IFRS”) promulgated by the International Accounting Standards Board. Since the Company meetsall requirements of a “specified company applying designated International Financial Reporting Standards” stipulated in
Article 1-2 of the “Ordinance on Terminology, Forms, and Preparation Methods of Consolidated Financial Statements”(Ordinance of the Ministry of Finance No. 28 of 1976), the Company prepares the consolidated financial statements inaccordance with IFRS under the provisions of Article 93 of said Ordinance.
The issue of consolidated financial statements was approved by Koichi Sato, President of the Company on June 26, 2020.
(2) Basis of measurement
As stated in Note “3. Significant Accounting Policies,” the consolidated financial statements of the Group have been preparedon a historical cost basis except for certain assets and liabilities, such as financial instruments measured at fair value.
(3) Functional and presentation currency
The consolidated financial statements of the Group are presented in Japanese yen which is the Company’s functional
currency. The units are in millions of yen and figures less than one million yen are rounded down to the nearest million yen.
(4) Changes in accounting policies
The Group mainly adopted the following standards in the fiscal year ended March, 2020.
Standard
Title
Outline of new and amended standards
IFRS 16
LeasesAmendment of accounting for lease
The changes and effects on the consolidated financial statements are as follows:(IFRS 16, “Leases”)
The Group adopted IFRS 16 “Leases” issued in January, 2016 (hereinafter the “IFRS 16”) in the fiscal year ended March, 2020.
As a transitional measure to IFRS 16, the Group applies this standard using retrospective approach and recognizes the
cumulative effect at the date of initial application as adjustments to retained earnings at the beginning.
In applying this standard, the Group elected to apply the practical expedient detailed in IFRS16 paragraph C3 andgrandfathered the assessment of whether a contract contains a lease at the date of initial application based on IAS 17 “Leases”(hereinafter the “IAS 17”) and IFRIC 4 “Determining whether an Arrangement contains a Lease”. After the commencement date,the Group assesses whether the contract contains a lease under the provisions of IFRS16.
For leases as a lessee that the Group previously classified as operating leases under IAS 17, the Group recognizes right-of-use
assets and lease liabilities at the date of initial application except for short-term leases and leases of low-value assets. Lease
payments for short-term leases and leases of low-value assets are recognized as an expense on a straight-line basis over the lease
term.
Lease liabilities are measured at the present value of the remaining lease payments discounted using the lessee’s incremental
borrowing rate at the date of initial application. The weighted average of lessee’s incremental borrowing rate is 0.03%.
An amount of right-of –use assets recognized at the date of initial application is equal to an amount of lease liabilities adjusted
for prepaid or accrued lease payments. As a result, there is no cumulative effect to retained earnings at the beginning.
For leases as a lessee that the Group previously classified as finance leases under IAS 17, the carrying amounts of right-of –useassets and lease liabilities at the date of initial application are the carrying amounts of lease assets and lease liabilities as at

12

March 31, 2019 under IAS 17.
The following is a reconciliation of non-cancellable operating lease contracts as at March 31, 2019 under IAS 17 and leaseliabilities recognized in the consolidated statement of financial position at the date of initial application.
(Unit: Millions of yen)Amount
629
750
5,513
6,893

Non-cancellable operating lease contracts as of March 31, 2019
Finance lease liabilities as of March 31, 2019
Effect by assessing the lease term, etc.
Lease liabilities as of April 1, 2019

Right-of-use assets recognized in the consolidated statement of financial position at the date of initial application are 7,477
million yen.
The following practical expedients are used in the application of IFRS 16.
(a)A single discount rate is applied to portfolios of leases with reasonably similar characteristics.
(b)The group accounts for leases for which the lease term ends within 12 months of the date of initial application in the same
way as short-term leases.
(c)Initial direct costs are excluded from the measurement of right-of-use assets at the date of initial application.
Under IAS 17, cash flows relating to leases categorized as operating leases were included in cash flows from operating activities
of consolidated statement of cash flows and payment of lease liabilities categorized as finance leases was included in repaymentof lease obligation of cash flows from financing activities. According to the application of IFRS 16, all cash flows relating to leases
other than short-term leases and leases of low-value assets for which recognition exemption is applied, are included in
repayment of lease obligation of cash flows from financing activities.
3. Significant Accounting Policies
The following accounting policies are applied to all fiscal periods stated in the consolidated financial statements.
(1) Basis of consolidation
Subsidiaries are entities that are controlled by the Group. Control means that the Company has exposure or rights tovariable returns from its involvement with any investee and has the ability to affect those returns through its power over theinvestee.
The financial statements of subsidiaries are included in the scope of consolidation from the date when control is obtained by
the Group until the date when it is lost.
When the accounting policies adopted by subsidiaries differ from those adopted by the Company, the financial statements of
the relevant subsidiaries are adjusted, when necessary. Intra-group balances of receivables and payables, intra-grouptransactions, and unrealized gains and losses arising from intra-group transactions are eliminated in preparing consolidated
financial statements.
Non-controlling interests in subsidiaries are recognized separately from the Group’s interests. Comprehensive income forsubsidiaries is allocated to the equity attributable to owners of the parent company and non-controlling interests even if the
non-controlling interests result in a deficit balance.
(2) Business combinations
Business combinations are accounted for using the acquisition method. Consideration of acquisition in a businesscombination is measured as the sum of the fair value on the acquisition date of the assets transferred, the liabilities assumed,
and equity instruments issued by the Company in exchange for control over an acquiree. If the consideration of acquisition
exceeds the fair value of identifiable assets and liabilities, the excess is recorded as goodwill. However, if the consideration of
acquisition is lower than the fair value of the identifiable assets and liabilities, the difference is recognized in profit or loss.
Changes in the ownership interests in subsidiaries without a loss of control are accounted for as equity transactions.
(3) Foreign currency translation
1) Foreign currency transactions
Each company of the Group defines its own functional currency as the currency of the primary economic environment in

13which it operates, and measures transactions using its functional currency.
When each company prepares its standalone financial statements, transactions in currencies other than the functional
currency are translated using the exchange rate prevailing at the date of the transactions or an exchange rate thatapproximates thereto.
Monetary assets and liabilities denominated in foreign currencies at the fiscal year-end are translated at the exchange rate
prevailing at the fiscal year-end.
Exchange differences arising from settlement or translation of accounts are basically recognized in profit or loss.
2) Financial statements of foreign operations
Assets and liabilities of foreign operations are translated into Japanese yen using the exchange rate at the fiscal year-end,
and income and expenses are translated at the average exchange rate for the fiscal year. However, if such an averageexchange rate is not considered as a reasonable approximation of the cumulative effect of the exchange rates at thetransaction dates, the exchange rates at the transaction dates are used. Translation differences arising from the translationof financial statements of foreign operations are recognized in other comprehensive income. If control of foreign operations
is lost, cumulative translation differences of foreign operations are recognized in profit or loss in the period of disposal.
(4) Financial instruments
1) Financial assets(i) Initial recognition and measurement
The Group divides all financial assets into three classifications - those measured at fair value through profit or loss, thosemeasured at fair value through other comprehensive income and those measured at amortized cost. This classification isdesignated at initial recognition.
At initial recognition, all financial assets are measured at fair value plus, in the case of a financial asset not at fair value
through profit or loss, transaction costs.
A financial asset is measured at amortized cost if both of the following conditions are met:(a) The asset is held within a business model whose objective is to hold assets in order to collect contractual cash flows.
(b) The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments ofprincipal and interest on the principal amount outstanding.
A financial asset is measured at fair value unless it is measured at amortized cost.
An equity instrument that is not held for trading elected to present subsequent changes in the fair value in othercomprehensive income at initial recognition is classified as a financial asset measured at fair value through othercomprehensive income and other financial assets measured at fair value are measured at fair value through profit or loss.
(ii) Subsequent measurement
After initial recognition, a financial asset is measured by classification as follows;(a) A financial asset at amortized cost is measured at amortized cost using the effective interest method.
(b) A financial asset at fair value through profit or loss and at fair value through other comprehensive income aremeasured at fair value after initial recognition and value changes are recognized in profit or loss and othercomprehensive income respectively. For financial assets measured at fair value through other comprehensive income,amounts recognized in other comprehensive income are not subsequently transferred to profit or loss. However,dividends from a financial asset at fair value through other comprehensive income are recognized in profit or loss
unless the dividend clearly represents a recovery of part of the cost of the investment.
Value changes of the fair value in a financial asset measured at fair value through other comprehensive income that arerecognized in other comprehensive income are presented in other components of equity in consolidated statement offinancial position. Upon derecognition, amounts in other comprehensive income are reclassified to retained earnings.
(iii) Impairment of financial assets
Expected credit losses are recognized through a loss allowance in financial assets measured at amortized cost. At every
reporting date, the group assesses whether the credit risk on that financial instrument has increased significantly sinceinitial recognition or not.
A loss allowance at an amount equal to the 12-month expected credit losses is recognized if the credit risk of that financial
instrument has not increased significantly since initial recognition. A loss allowance at an amount equal to full lifetime
expected credit losses is recognized if the credit risk of that financial instrument has increased significantly since initial

14

recognition.
A loss allowance at an amount equal to full lifetime expected credit losses is recognized to trade and other receivables thatare not contained a significant financing component.
If the amount of an impairment loss decreased by an event occurred after recognition of the impairment, the impairment
loss recognized in the past is reversed and recognized in profit and loss.
(iv) Derecognition
The Group derecognizes financial assets only when contractual rights to the cash flows from the financial assets are
extinguished, or when the Group transfers substantially all of the risks and economic value incidental to ownership of thefinancial assets.
2) Financial liabilities(i) Initial recognition and measurement
The Group divides financial liabilities into two classifications - those measured at fair value through profit or loss and thosemeasured at amortized cost. This classification is designated at initial recognition.
All financial liabilities are measured at fair value at initial recognition and transaction costs directly attributable to theissuance of financial liabilities, other than financial liabilities measured at fair value through profit or loss, are deductedfrom the fair value of the financial liabilities.
(ii) Subsequent measurement
After initial recognition, a financial liability is measured by classification as follows;(a) Financial liabilities at fair value through profit or loss are measured at fair value after initial recognition, and any gainor loss arising from remeasurement is recognized in profit or loss.
(b) Financial liabilities at amortized cost are measured at amortized cost mainly using the effective interest method after
initial recognition.
A gain or loss from extinguishment of amortization by effective interest method and derecognition of financial liabilities isrecognized in profit or loss.
(iii) Derecognition
The Group derecognizes financial liabilities only when they are extinguished, i.e. when obligations specified in the contract
are discharged, cancelled, or expired. When a financial liability is derecognized, the difference between the carrying amountof the financial liability and the consideration paid or to be paid is recognized in profit or loss.
3) Offsetting financial assets and financial liabilities
Financial assets and financial liabilities are offset and the net amount is reported in the consolidated statement of financial
position, if there is a currently enforceable legal right to offset the recognized amounts and if there is an intention of
settlement on a net basis, or of simultaneous realization of the assets and settlement of the liabilities.
4) Derivative financial instruments
Derivative financial instruments are initially recognized at fair value on the date when the derivative contract is enteredinto and are subsequently remeasured at fair value.
Any gains or losses arising from changes in the fair value of derivatives are recognized directly to profit or loss except for
those that qualify for hedge accounting.
The Group uses derivative financial instruments, such as forward currency contracts, options and interest rate swaps, tohedge foreign currency risk and interest rate risk.
At the inception of the hedge, the Group formally designates and documents the hedging relationship and the Group’s risk
management objective and strategy for undertaking the hedge.
The Group doesn’t have any hedged item that meets requirements of hedge accounting.

15

(5) Cash and cash equivalents
Cash and cash equivalents consist of cash on hand, demand deposits, and short-term investments that are readily
convertible and subject to an insignificant risk of changes in value and are due within three months from the date ofacquisition.
(6) Inventories
Inventories are measured at the lower of cost or net realizable value. The costs of inventories are determined based on theweighted average method. Net realizable value is the estimated selling price in the ordinary course of business lessestimated costs of completion and estimated costs necessary to make the sale.
(7) Property, plant and equipment
Property, plant and equipment are measured at cost less any accumulated depreciation and accumulated impairment losses.
The cost of property, plant and equipment includes costs directly attributable to the acquisition, and restoration costs, etc.
Depreciation of each item of property, plant and equipment, other than land and construction in progress, is recorded using
the straight-line method over the estimated useful life of each item.
The main estimated useful lives are as follows:‐Buildings and structures

2 to 60 years‐Machinery, equipment and vehicles 2 to 15 years‐Tools, fixture and fixtures

2 to 25 years

The estimated useful lives, residual value, and depreciation method are reviewed every fiscal year and revised if necessary.
(8) Intangible assets
1) Software
Software for internal use is measured at cost at initial recognition. Internal and external expenses incurred at the
preparation stage are recorded as expenses when they are incurred, and internal and external expenses incurred at thedevelopment stage are recorded in intangible assets.
Expenses incurred after the introduction of the software, such as maintenance expenditure, are recorded as expenses when
they are incurred. Amortization is recorded using the straight-line method over the estimated useful life (mainly 5 years).
The estimated useful lives and amortization method are reviewed every fiscal year and revised if necessary.
2) Development cost
Expenditures arising from research activities to obtain new scientific or technical knowledge are recorded as expenses
when incurred.
Expenditures arising from development activities are recorded as intangible assets, only when all of the following
conditions are met:(a) The Group has the technical feasibility of completing the intangible asset so that it will be available for use or sale.
(b) The Group has its intention to use or sell the intangible asset.
(c) The Group has its ability to use or sell the intangible asset.
(d) Intangible asset will generate probable future economic benefits.
(e) The Group has the availability of adequate technical, financial and other resources to complete the development and touse or sell the intangible asset.
(f) The Group has its ability to measure reliably the expenditure attributable to the intangible asset during its
development.
Amortization is recorded using the straight-line method over the estimated useful life (5 years). The estimated useful lives
and amortization method are reviewed every fiscal year and revised if necessary.
3) Patent rightPatent right is measured at cost at initial recognition.
Amortization is recorded using the straight-line method over the estimated useful life (11 years). The estimated useful lives
and amortization method are reviewed every fiscal year and revised if necessary.

16(9) Leases
For the year ended March 31, 2019
Leases are classified as finance leases (lessee) when all the risks and rewards of ownership of an asset in an arrangement aresubstantially transferred to the Group, and all leases other than finance leases are classified as operating leases (lessee).
Leased assets under finance lease transactions (lessee) are initially recognized at the lower of the fair value of leased
properties or the present value of minimum lease payments, which were determined at the inception of the lease. After the
initial recognition, the leased assets are depreciated over the estimated useful life of the assets or the term of the lease,whichever is shorter, based on the relevant accounting policies.
Lease payments are allocated to finance costs and payments of lease obligations in accordance with the interest method, andfinancial costs are recognized in the consolidated statement of income.
In operating lease transactions (lessee), lease payments are recognized as expenses in the consolidated statement of income
using the straight-line method over the lease term. However, if the time pattern of benefits is more appropriately presented,
the lease payments are recognized as expenses in the period in which they are incurred.
Leases are classified as finance leases (lessor) when all the risks and rewards of ownership of an asset in an arrangement issubstantially transferred to the lessee.
Lease receivables under finance leases (lessor) are initially recognized at the net investment in the lease. After initialrecognition, the lease receivables are recognized in profit or loss in the period in which they are attributable after reflecting a
constant periodic rate of return on the net investment in the lease.
For the year ended March 31, 2020
As a lessee
The Group measures lease liabilities at the present value of the lease payments that are not paid at the commencement date,discounted using its incremental borrowing rate generally.
The right-of-use assets are initially measured at the initial amount of the lease liability adjusted for any initial direct costs.
The right-of-use assets are depreciated using the straight-line method to the earlier of the end of the lease term or the end of
the useful life of the right-of-use assets.
Lease payments are apportioned between interest expenses and the remaining balance of lease liabilities to be repaid to
produce a constant periodic rate of interests on the remaining balance of the lease liability.
Interest expenses are presented separately from the depreciation charge for the right-of-use-assets in the consolidated
statement of income.
The Group assesses whether the contract is , or contains, a lease by the substance of the contract, regardless of whether it islegally presented in the form of a lease or not.
For leases for which the lease term ends within 12 months and values are low, lease payments are recognized as an expense
on a straight-line basis over the lease term.
As a lessor
The Group has no significant lease transaction as a lessor.
(10) Impairment of non-financial assets
The carrying amount of non-financial assets of the Company, excluding inventories and deferred tax assets, is evaluatedevery fiscal year to determine whether there is any indication of impairment. If any such indication exists, the recoverable
amount of the non-financial assets is estimated. A recoverable amount of an asset or a cash-generating unit is the higher ofits value in use and its fair value less cost to sell. In calculating value in use, the estimated future cash flows are discounted
to their present value using a pre-tax discount rate that reflects the time value of money and risks specific to the assets.
Assets that are not individually tested for impairment are included in the smallest cash-generating unit that generates cash
inflows that are largely independent of the cash inflows from other assets or groups of assets.
If, and only if, the recoverable amount of an asset or a cash-generating unit is less than its carrying amount, the carrying
amount of the asset shall be reduced to its recoverable amount. That reduction is recognized as an impairment loss in profit
or loss. An impairment loss recognized related to a cash-generating unit is allocated first to reduce the carrying amount ofany goodwill allocated to the cash-generating unit, and then to reduce the carrying amount of other assets of the
cash-generating unit on a pro-rata basis.

17

An impairment loss recognized in prior years is evaluated every fiscal year to determine whether there is any indication thatsuch impairment may have decreased or may no longer exist.
An impairment loss is reversed if there is an indication of reversal of impairment and there has been a change in theestimates used to determine the asset’s recoverable amount. An impairment loss is reversed up to the amount not exceeding
the carrying amount, net of depreciation or amortization, that would have been determined if no impairment had beenrecognized.
These estimates are based on the best available estimates by management. However, they may differ from actual results due
to changes in uncertain future economic conditions.
(11) Employee benefits
1) Post-employment benefits
The Group has defined benefit plans and defined contribution plans as post-employment benefit plans for employees.
The Group calculates the present value of defined benefit obligations and related current service cost using the projected
unit credit method.
The rate used to discount defined benefit obligations is basically determined by reference to market yields at the end of thereporting period on high quality corporate bonds.
Liabilities or assets for defined benefit plans are calculated by deducting the fair value of plan assets from the present valueof defined benefit obligations. Service cost and net interest on defined benefit liabilities (assets) are recognized in profit orloss in the accounting period in which they are incurred. The Group recognizes the increase or decrease in obligations dueto the remeasurement of benefit obligations and plan assets of defined benefit plans in other comprehensive income andthen immediately reclassifies them from other comprehensive income to retained earnings.
These estimates are based on the best available estimates by management. However, they may differ from actual results
due to changes in uncertain future economic conditions.
2) Short-term employee benefits
When an employee has rendered service to the Group during an accounting period, the Group recognizes theundiscounted amount of short-term employee benefits expected to be paid in exchange for that service in profit or loss.
The Group recognizes the expected cost of profit-sharing and bonus payments as a liability when it has a present legal orconstructive obligation to make such payments as a result of past events, and a reliable estimate of the obligation can be
made.
These estimates are based on the best available estimates by management. However, they may differ from actual results
due to changes in uncertain future economic conditions.
(12) Provisions
Provisions are recognized when the Group has present legal and constructive obligations as a result of past events, and when
it is probable that outflows of economic resources embodying economic benefits will be required to settle the obligations, andreliable estimates of the amount of such obligations can be made. When the effect of the time value of money is material,
provisions are calculated by discounting estimated future cash flows to the present value using a pre-tax discount rate thatreflects the time value of money and the risks specific to the liabilities.
These estimates are based on the latest information from customers, previous years’ results and the best available estimatesby management. However, they may differ from actual results due to changes in uncertain future economic conditions.
The main provisions are as follows:
1) Provision for compensation for products
The provision for compensation for products is recorded in order to deal with market claim.
2) Provision for loss on litigation
The provision for loss on litigation is recorded to cover probable losses on lawsuits based on the information currently
available.
(13) Treasury stock
Treasury stock is measured at cost and recognized as a deduction from equity. When the Group sells the treasury stock, thedifference between the carrying amount and the consideration received from the sale is recognized as capital surplus.

18

(14) Revenue
The Group recognizes revenue based on the following five-step approach except for interest and dividends within the scope of
IFRS 9 “Financial Instruments” and lease income within the scope of IAS 17 “Leases”, etc.;
Step 1 : Identify the contract(s) with a customer
Step 2 : Identify the performance obligations in the contract
Step 3 : Determine the transaction price
Step 4 : Allocate the transaction price to the performance obligations in the contract
Step 5 : Recognize revenue when (or as) the entity satisfies a performance obligation
The Group’s primary operations are manufacture and sale of products in business of instruments for automobiles,
motorcycles, agricultural / construction machines, boats, business of component and sale of automobiles in business of
automobile sales.
For sale of products, revenue is recognized when products are transferred to customers because control is passed tocustomers at a point in time of transfer and a performance obligation is satisfied. For sale of automobiles, revenue isrecognized when automobiles are transferred to customers. Revenue is measured at the amount of consideration contractedwith customers excluding discounts, rebates, and refunds, etc.
(15) Income taxes
Income taxes comprise current taxes and deferred taxes. These are recognized in profit or loss, except for items that relate tobusiness combinations and items recognized directly in equity or in other comprehensive income.
Current taxes are measured at the amount expected to be paid to or refunded from the taxation authorities. The tax amountis calculated in accordance with the tax laws and tax rates that have been enacted or substantially enacted by the end of the
fiscal year in the country where the Group conducts business activities and earns taxable income.
Deferred taxes are recognized on temporary differences between the carrying amount of assets and liabilities on statement offinancial position as at reporting date and such amount on a tax law basis, and unused tax losses and unused tax credits.
Deferred tax liabilities are, in principle, recognized for all taxable temporary differences, and deferred tax assets arerecognized for deductible temporary differences, unused tax losses and unused tax credits, to the extent that it is probablethat they can be utilized for future taxable income.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced for the amount that
it is probable that sufficient taxable income will no longer be available to allow all or part of the deferred tax assets to be
recovered. Unrecognized deferred tax assets are re-evaluated at the end of each reporting period and are recognized to theextent that it has become probable that future taxable income will be available to allow the deferred tax assets to be
recovered.
Deferred tax assets and liabilities are measured in accordance with tax laws and tax rates that are expected to apply in the
period in which the assets are realized or the liabilities are settled, based on the tax laws and tax rates that have beenenacted or substantially enacted by the end of reporting period.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to income taxes levied on the same entity by the same tax authority.
These estimates are based on the best available estimates by management. However, they may differ from actual results due
to changes in uncertain future economic conditions.

19

4. Significant Accounting Estimates and Judgments
The preparation of the consolidated financial statements requires management to make judgments, estimates, andassumptions that affect the application of accounting policies and the amounts of assets, liabilities, income and expenses.
However, actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. The effects of changes in accounting estimates
are recognized in the accounting period in which the estimates are changed and in future accounting periods affected by thechanges.
The estimates and judgments made by management that may have significant effects on the amounts in the consolidated
financial statements are as follows:(1) Impairment of non-financial assets:

Note 3 (10) “Impairment of non-financial assets”(2) Measurement of defined benefit obligation: Note 3 (11) “Employee benefits”(3) Provision for compensation for products:

Note 3 (12) “Provisions”(4) Recoverability of deferred tax assets:

Note 3 (15) "Income taxes"

The impact of coronavirus pandemic on accounting estimates and judgments is stated in Note 33 “Additional information”.
5. Accounting Standards and Interpretations Issued but Not Yet Adopted
The Group has not elected early adoption of new or amended standards and interpretations that had been issued up to thedate of approval of the consolidated financial statements and the impact by the adoption of main standards andinterpretations is immaterial.
6. Segment Information(1) Overview of reportable segments
The reportable segments of the Group are those units for which separate financial information is available, and which arereviewed regularly by the Group’s management in order to determine allocation of resources and to assess businessperformance. The segments are not aggregated for reporting purposes.
The Group has business units categorized by product and service, and each business unit plans comprehensive businessstrategies and operates business activities domestically and internationally.
Therefore, the Group has reportable segments, such as instruments, component, and automobile sales based on business
units categorized by products and services.
In instruments business, the Group manufactures and sells instruments for automobiles, head-up displays, instruments formotorcycles / agricultural / construction machines and boats, and various sensors. In component business, the Group
manufactures and sells operating panels for office automation (OA) and information equipment, controllers for
air-conditioning and household equipment, assemblies for factory automation (FA), amusement units, high-density
mounting boards, liquid crystal display panels and modules, electroluminescence panels and modules, as well as
manufacture and sale of products for aftermarkets. In automobile sales business, the Group is engaged in the sale of new
and used automobiles, as well as the provision of car inspection and maintenance services.

20

(2)Revenue, segment profit or loss and other items by reportable segment
Revenue, profit or loss and other items of the Group’s reportable segments are as follows:
For the year ended March 31, 2019
(Unit: Millions of yen)
Reportable segments

OthersInstruments

Component

Automobile
sales

206,237

15,45424,563(Note 1)

Total

Adjustment(Note 2)

Total onconsolidated
statement ofincome263,239－

263,239

Total

Revenue
Customers

246,255

16,983

Intersegment

－

201

61

262

17,006

17,268(17,268)－

Total revenue

206,237

15,656

24,624

246,518

33,989280,507(17,268)

263,239

Segment profit(loss)

11,509

(956)

1,253

11,806

2,638

14,445(229)

14,215

Finance income

－

－

－

－

－

－

－

2,654

Finance costs

－

－

－

－

－

－

－

(579)

Profit before tax

－

－

－

－

－

－

－

16,291

Segment assets

209,566

15,246

11,943

236,755

17,660254,416

53,249307,665

7,687

298

450

8,435

586

9,022

78

9,101

Impairment
loss

262

59

－

322

4

327

－

327

Capitalexpenditure

10,569531

649

11,7502,423

14,17346

14,220

Other items
Depreciation andamortization(Note)
1. “Others” is the business segment that is not categorized as reportable segment and includes transportation of cargoes,development and sales of software, entrusted accounting business and the processing and sales of resin materials etc.
2. The breakdown of “Adjustment” is as follows:(1) Segment profit (loss) totaling (229) million is elimination of inter-segment transactions, etc.
(2) Corporate assets totaling 53,794 million are included in adjustment of segment assets. Main corporate assets are
the Company’s cash, deposits and investment securities.
(3) Adjustment totaling 78 million in depreciation and amortization is for corporate assets.
(4) Capital expenditure totaling 46 million is investment to corporate assets.

21

For the year ended March 31, 2020
(Unit: Millions of yen)
Reportable segments

Others(Note 1)

Total

Adjustment(Note 2)

Total onconsolidated
statement ofincomeInstruments

Component

Automobile
sales

192,798

15,172

22,226230,198

16,142

246,340－

246,340

Intersegment

－

－

26

26

15,293

15,319(15,319)－

Total revenue

192,798

15,172

22,253

230,224

31,435

261,660(15,319)

246,340

Segment profit(loss)

7,111(2,139)

913

5,885

1,958

7,843

(173)

7,669

Finance income

－

－

－

－

－

－

－

3,047

Finance costs

－

－

－

－

－

－

－

(3,151)

Profit before tax

－

－

－

－

－

－

－

7,566

Segment assets

202,451

14,502

12,959229,913

20,638250,552

46,434

296,987

8,425

382

781

9,589

1,210

10,799347

11,146

Impairment
loss

9

334

－

344

－

344

－

344

Capitalexpenditure

11,363582

892

12,8392,259

15,09847

15,145

Total

Revenue
Customers

Other items
Depreciation andamortization(Note)
1. “Others” is the business segment that is not categorized as reportable segment and includes transportation of cargoes,development and sales of software, entrusted accounting business and the processing and sales of resin materials etc.
2. The breakdown of “Adjustment” is as follows:(1) Segment profit (loss) totaling (173) million is elimination of inter-segment transactions, etc.
(2) Corporate assets totaling 46,679 million are included in adjustment of segment assets. Main corporate assets are
the Company’s cash, deposits and investment securities.
(3) Adjustment totaling 347 million in depreciation and amortization is for corporate assets.
(4) Capital expenditure totaling 47 million is investment to corporate assets.

22

(3) Information by region
Revenue from customers and non-current assets (excluding financial assets, deferred tax assets, retirement benefit assets
and rights arising under insurance contracts) of the Group by geographical region are as follows. Revenue from customers isclassified by country and area based on geographic location.
1) Revenue from customers(Unit: Millions of yen)
Year ended March 31,2019
Japan

Americas91,178Europe55,364Asia

26,293

Total

90,402

263,239(Unit: Millions of yen)
Year ended March 31,2020
Japan

Americas89,244

Europe55,073

21,539

Asia

Total

80,483

246,3402) Non-current assets(Unit: Millions of yen)March 31,2019Japan
47,236

Americas

Europe

7,886

2,120

Asia

Total

14,032

71,276(Unit: Millions of yen)March 31,2020
Japan
55,423

Americas

Europe

6,967

3,823

Asia

Total

13,62079,835(4) Information about major customers
Revenue from an individual customer accounted for more than 10 % of consolidated revenue is as follows:(Unit: Millions of yen)
Name of customer
Honda Motor Corporation and its subsidiaries

Segment

Year ended March 31,2019

Instruments

23

61,864

Year ended March 31,2020
56,055

7. Cash and Cash Equivalents
The breakdown of cash and cash equivalents is as follows:(Unit: Millions of yen)March 31,2019
Cash and deposits

March 31,2020
42,12836,657The balance of “cash and cash equivalents” on the consolidated statement of financial position is consistent with “cash andcash equivalents” on the consolidated statement of cash flows.
8. Trade and Other Receivables
The breakdown of trade and other receivables is as follows:(Unit: Millions of yen)March 31,2019

March 31,2020Trade receivables
Note and electronically recorded monetary claims
Accounts receivable – other
Other
Allowance for doubtful accounts

35,630
7,565
4,960
181
(127)

27,981
6,099
4,176
461
(150)

Total

48,20938,569Current
Non-current

48,038170

38,117451

Total

48,20938,5699. Other Financial Assets and Other Financial Liabilities(1) The breakdown of other financial assets(Unit: Millions of yen)March 31,2019
Other financial assets
Financial assets measured at fair value throughprofit or loss
Derivative assets
Financial assets measured at fair value throughother comprehensive income
Shares and Investments in capital
Financial assets measured at amortized cost
Time deposits
Other

March 31,2020－

51

19,260

16,291

68,8391,980

70,293
1,991

Total

90,07988,628Current
Non-current

68,113
21,96569,66818,959

Total

90,07988,628(2) The breakdown of other financial liabilities(Unit: Millions of yen)March 31,2019

March 31,2020

Other financial liabilities
Financial liabilities measured at fair value
through profit or loss
Derivative liabilities
Financial liabilities measured at amortized cost
Lease liabilities

2

－

773

6,242

Total

776

6,242

Current
Non-current

197
578

1,976
4,266

Total

776

6,242

24

10. Inventories
The breakdown of inventories is as follows:(Unit: Millions of yen)March 31,2019

March 31,2020

Merchandise and finished goods
Work in process
Raw materials and supplies

16,7905,453
24,231

15,2005,519
23,215

Total

46,47543,934

1. Inventories recognized as an expense account for a large part of cost of revenue.
2. The amounts of write-down of inventories to net realizable value recognized as cost of revenue are as follows:(Unit: Millions of yen)
Year ended March 31,2019
The amounts of write-down

Year ended March 31,2020

(218)

208

11. Property, Plant and Equipment(1) Schedule of property, plant and equipment
The breakdown and schedule of property, plant and equipment are as follows:
1) Acquisition costs(Unit: Millions of yen)

Buildings

As of April 1, 2018

Acquisition
Sales or
Disposal
Transfer
Foreign

Structures

Machineryandequipment

VehiclesTools,
furnitureandfixtures

Right-of-use
AssetsLand

Construction

Total

in
progress

2,670

176,715

25

－
－

7,228

11,301(1,813)

(58)

－

－

(4,131)

47

1,267

－

－

(5,741)

(49)

5

19

21

－

(17)

(61)

44,061

3,621

63,5192,182

43,037

17,622

207

39

1,378

598

1,823

(311)

(56)

(1,827)

(65)

456

62

3,859

(33)

8

(66)

currencytranslation
adjustments

Other
As of March 31,2019

Changes inaccounting policy
As of April 1, 2019

Acquisition
Sales or
disposal
Transfer
Foreign

1

－

(47)

(494)

(2)

－

(701)

3,676

66,8152,275

44,332

17,610－－(158)

44,382

3,981

183,073

－

－

(139)

(99)

(1,261)

－

8,215

－

6,715

44,382

3,676

66,6762,175

43,07017,610

8,215

3,981

189,788

250

25

1,158

843

1,400

168

1,750

9,955

15,551

(424)

(64)

(2,368)(75)(3,187)－－－(6,120)

2,141

60

3,787

40

1,878

－

－

(8,101)(192)(1,221)(4)(3,353)(41)(1,020)

(140)

(167)

(195)

(6,145)currencytranslation
adjustments

Other
As of March 31,2020

(116)

(8)

(237)

(614)

45

(48)

(725)

(367)

(2,074)45,011

3,683

65,662

2,328

42,186

17,589

9,072

5,272

190,80725

2) Accumulated depreciation and accumulated impairment loss
(Unit: Millions of yen)

Buildings

Structures

Machineryandequipment

VehiclesTools,
furnitureandfixtures

Right-of-use
Assets

Land

Total

in
progress－－－(115,255)

(145)

－
－
－

1,517

16

－

－

3,693

(46)

－

－

－

(60)

As of April 1, 2018(27,850)(2,908)(47,475)(993)(34,967)(1,061)

Depreciation
Impairment loss
Sales or
Disposal(1,166)
(156)

(80)

(372)

－

(2,972)(5)－－(3,313)
(3)

296

52

1,747

63

(8)

(7)

4

(2)

Foreign

Construction(7,905)(310)

currencytranslation
adjustments

(20)

(0)

(82)

177

(81)

－

(28,905)(2,944)(49,122)(1,126)(36,555)(1,189)－－－－(119,844)

－

－

84

68

648

－

(801)

－

－

As of April 1, 2019(28,905)(2,944)(49,038)(1,058)(35,907)(1,189)(801)(119,844)

Depreciation
Impairment loss
Sales or
disposal(1,239)
(63)

(79)
(6)

(3,387)
(204)

(330)

－

－

(2,579)(30)(7)(1,670)
－

－
－
(21)

(9,287)
(334)

397

53

2,311

85

3,045

－

－

－

5,893

606

3

2,256

27

767

－

0

－

3,662

Other
As of March 31,2019

Changes inaccounting policy

Foreign(6)

currencytranslation
adjustments

(16)

(0)

(69)

232

(17)

－

6

－

136

(29,219)(2,973)(48,132)(1,042)(34,722)(1,197)(2,463)(21)(119,773)

Other
As of March 31,2020

Depreciation of property, plant and equipment is included in “cost of revenue” and “selling, general and administrative expenses”
in the consolidated statement of income. The information of impairment loss is disclosed in Note “13 Impairment Loss.”3) Carrying amount(Unit: Millions of yen)

VehiclesTools,
furnitureandfixtures

Buildings

Structures

Machineryandequipment

As of April 1, 201816,211713

16,043

1,189

8,070

16,561

61,45915,477731

17,692

1,148

7,776

16,420－－2,670

As of March 31, 2019

3,981

63,228

As of March 31, 2020

15,791710

17,530

1,285

7,464

16,392

6,608

5,250

71,034Land

Right-of-use
AssetsConstruction inprogress

Total

Carrying amount of leased assets under finance leases including in each property, plant and equipment is as follow:(Unit: Millions of yen)March 31,2019
Machinery and equipment
Tools, fixture and fixtures

85
613

Total

698

Leased assets for financial year as at March 31, 2020 are disclosed in Note 28 “Leases”.
(2) Carrying amount of assets pledged as collateral for funding and guarantee transaction as at March 31, 2019 and 2020 is asfollows:(Unit: Millions of yen)March 31,2019
Property, plant and equipment

March 31,2020
159

26

158

12. Goodwill and Intangible Assets
The breakdown and schedule of intangible assets are as follows:(1) Acquisition costs(Unit: Millions of yen)
Development

Softwarecost

Software in
progress

Right-of-use Assets

12

12,843

－
－
－
－
－
－

3,066
2
(106)
49
54
(20)

12

15,889

Other

Total

As of April 1, 2018

9,086

1,378

2,365

Acquisition
Increase arising from internal development
Sales or disposal
Transfer
Foreign currency translation adjustments
Other

1,060

－

2,006

－

2

(106)
70
55
(20)

－
－
－
－

－
－
(21)
(0)

As of March 31, 201910,146

1,380

4,349

－
－
－
－
－
－
－
－

Changes in accounting policy

(182)

－

－

182

－

－

As of April 1, 2019

9,963

1,380

4,349

182

12

15,889

618

398

－
－
－
－
－

2,020
2
(135)
168
(121)
(733)

410

17,090－Acquisition
Increase arising from internal development
Sales or disposal
Transfer
Foreign currency translation adjustments
Other

－

1,003

－

2

(135)
194
(118)
(710)

－
－
－
－

－
－
(26)
(2)
(23)

－
－
－
－
－
－

As of March 31, 2020

9,812

1,382

5,301

182

(2) Accumulated depreciation and accumulated impairment loss
(Unit: Millions of yen)
Development
cost

SoftwareRight-of-use Assets

Other

Total

As of April 1, 2018

(6,696)(909)

Amortization
Impairment loss
Sales or disposal
Foreign currency translation adjustments
Other(1,057)
(16)
93
(38)
(49)

(197)

As of March 31, 2019(7,763)(1,107)

－
－
－
－
－
－
－

119

－

(119)

－

－

As of April 1, 2019

(7,643)(1,107)

(119)

(7)

(8,878)

Amortization
Impairment loss
Sales or disposal
Foreign currency translation adjustments
Other(1,024)
(8)
124
82
757

(173)

(11)

(27)

－
－
－
－

－
－
－
(8)

－
－
－
－

(1,236)
(8)
124
82
748

As of March 31, 2020

(7,711)(1,280)

(139)

(34)

(9,167)

Changes in accounting policy

－
－
－
－

(7)

(7,613)

(0)

－
－
－
－

(1,255)
(16)
93
(38)
(49)

(7)

(8,878)

1. The amortization of intangible assets is included in “cost of revenue” and “selling, general and administrative expenses” inthe consolidated statement of income.
2. The amount of development expenses recognized in profit or loss during the fiscal years ended March 31, 2019 and 2020 is¥3,712 million and ¥3,991 million respectively and is included in “cost of revenue” and “selling, general and administrative
expenses” in the consolidated statement of income.
(3) Carrying amount(Unit: Millions of yen)
SoftwareDevelopment
cost

Software in
progress

Right-of-use Assets

Other

Total

As of April 1, 2018

2,390

468

2,365

5,229

2,383

272

4,349

－
－

5

As of March 31, 2019

5

7,010

As of March 31, 2020

2,100

102

5,301

43

375

7,923

27

13. Impairment Loss
(1) Property, plant and equipment
The Group recognized an impairment loss for the following assets:
For the fiscal year ended March 31, 2019
(Unit: Millions of yen)Segment
Instruments

Purpose of use
Assets held for sale, etc.

Type of assets

AmountBuildings and structures, tools, furniture andfixtures, and land

262

Assets are grouped by reporting segment. Due to changes of use of assets held in instruments business, the Group reduced
the carrying amount of the assets to recoverable amount and the reduction was recognized as an impairment loss in profit orloss. Recoverable amount of the assets was measured by net sale prices or value in use. The Group determined net sale prices
primarily by making reasonable adjustments to appraisal values in accordance with the “Real Estate Appraisal Standards”.
Recoverable amount based on value in use was appraised at 0 because future cash flows are negative.
(Unit: Millions of yen)Segment
Component

Purpose of use
Equipment for design anddevelopment, etc.

Type of assets

AmountBuildings and structures, tools, furniture andfixtures

43

Assets are grouped by reporting segment. Due to environment changes to component business, etc., the Group reduced thecarrying amount of the assets to recoverable amount and the reduction was recognized as an impairment loss in profit or loss.
Recoverable amount of the assets was measured by value in use. Recoverable amount based on value in use was appraised at
0 because future cash flows are negative.
For the fiscal year ended March 31, 2020
(Unit: Millions of yen)Segment
Component

Purpose of use
Equipment for manufacture, etc.

Type of assets

AmountBuildings and structures, tools, furniture andfixtures, and land

326

Assets are grouped by reporting segment. Due to environment changes to component business, etc., the Group reduced thecarrying amount of the assets to recoverable amount and the reduction was recognized as an impairment loss in profit or loss.
Recoverable amount of the assets was measured by net sale prices or value in use. The Group determined net sale prices
primarily by making reasonable adjustments to appraisal values in accordance with the “Real Estate Appraisal Standards”.
Recoverable amount based on value in use was appraised at 0 because future cash flows are negative.
(2) Intangible assets
The Group recognized an impairment loss for the following assets:
For the fiscal year ended March 31, 2019
(Unit: Millions of yen)Segment
Component

Purpose of use
Equipment for design anddevelopment, etc.

Type of assets

AmountSoftware16

Assets are grouped by reporting segment. Due to environment changes to component business, the Group reduced thecarrying amount of the assets to recoverable amount and the reduction was recognized as an impairment loss in profit or loss.
Recoverable amount of the assets was measured by value in use. Recoverable amount based on value in use was appraised
at 0 because future cash flows are negative.
For the fiscal year ended March 31, 2020
(Unit: Millions of yen)Segment
Component

Purpose of use
Equipment for design anddevelopment, etc.

Type of assets
SoftwareAmount8

Assets are grouped by reporting segment. Due to environment changes to component business, the Group reduced the28carrying amount of the assets to recoverable amount and the reduction was recognized as an impairment loss in profit or loss.
Recoverable amount of the assets was measured by value in use. Recoverable amount based on value in use was appraised at
0 because future cash flows are negative.
14. Income Taxes(1) Deferred tax assets and deferred tax liabilities
The breakdown and schedule of deferred tax assets and deferred tax liabilities are as follows:
For the fiscal year ended March 31, 2019
(Unit: Millions of yen)

As of April 1, 2018

Deferred tax assets
Inventories
Employees’ salaries
Property, plant and equipment andintangible assets
Accrued expenses
Provisions
Other
Total

Recognizedin othercomprehensive
incomeRecognized in
profit or loss

As of March 31,
2019

－

1,266
1,901

2
163

(10)

1,268
2,053

3,664

79

－

3,743

381
880
23

(82)
12
132

－
－
－

298
892
155

8,117

306

(10)

8,413

Deferred tax liabilities
Property, plant and equipment andintangible assets
Available-for-sale financial assets
Undistributed retained earnings of foreignsubsidiaries
Other

964

69

－

1,033

3,755

－

(950)

2,804

2,266

284

－

2,550

647

17

－

665

Total

7,633

371

(950)

7,054

For the fiscal year ended March 31, 2020
(Unit: Millions of yen)

As of April 1, 2019

Deferred tax assets
Inventories
Employees’ salaries
Property, plant and equipment andintangible assets
Accrued expenses
Provisions
Other
Total
Deferred tax liabilities
Property, plant and equipment andintangible assets
Financial assets measured at fair value
through other comprehensive income
Undistributed retained earnings of foreignsubsidiaries
Other
Total

Recognizedin othercomprehensive
incomeRecognized in
profit or loss

As of March 31,
2020

1,268
2,053

(394)
(245)

－
(8)

873
1,799

3,743

(1,771)

－

1,972

298
892
155

(96)
(626)
(207)

－
－
－

202
265
(51)

8,413

(3,342)

(8)

5,062

1,033

(272)

－

760

2,804

－

(834)

1,969

2,550

2

－

2,553

665

218

－

883

7,054

(52)

(834)

6,167

29

(2) Unrecognized deferred tax assets
The amount of deductible temporary differences and unused tax losses, for which no deferred tax assets were recognized, is
as follows. The amount of deductible temporary differences and unused tax losses is described as tax basis amount.
(Unit: Millions of yen)March 31,2019
Deductible temporary differences
Unused tax losses

March 31,2020
562
519

6,078
276

Unused tax losses for which no deferred tax assets are recognized expire as follows:(Unit: Millions of yen)March 31,2019

March 31,2020

1st year
2nd year
3rd year
4th year
5th year and thereafter

－
1
－
－
518

－
－
0
－
276

Total

519

276

(3) Income taxes
The breakdown of income tax expense is as follows:(Unit: Millions of yen)
Year ended March 31, 2019Year ended March 31,2020

Current income tax
Deferred income tax(3,947)77(4,174)(3,019)Total(3,869)(7,194)(4) Reconciliation between the applicable and effective tax rate
The reconciliation between the applicable tax rate and the effective tax rate is as follows:(Unit: Millions of yen)
Year ended March 31,2019
Statutory income tax rate
(Reconciliation)
Items such as entertainment expenses that are notdeductible permanently
Items such as dividends that are excluded fromincome permanently
Special tax exemption
Business tax on foreign income
Difference on tax rates applied to foreignsubsidiaries
Effect by assessment of recoverability of deferred
tax assets
Undistributed retained earnings of foreignsubsidiaries
Foreign tax credit
Other
Effective tax rate

30

Year ended March 31,2020
30.4%

30.4%

1.8%

3.1%

(1.9%)(4.9%)(1.6%)(1.0%)(0.6%)
1.2%(0.5%)(2.5%)

0.4%

72.9%

1.7%

0.0%

(0.5%)(5.0%)(1.0%)(3.5%)

23.8%

95.1%

15. Trade and Other Current Payables
The breakdown of trade and other current payables is as follows:(Unit: Millions of yen)March 31,2019

March 31,2020Trade payables
Notes and electronically recorded obligations
Accounts payable - otherNotes payable - facilities
Other

28,433
2,091
10,371541
1,399

22,464
1,883
8,554
254
1,362

Total

42,83734,51916. Loans(1)The breakdown of loans(Unit: Millions of yen)
Averageinterest rate

Repayment
periodMarch 31,2019

March 31,2020

44,51046,842

0.31%

－

3,750

3,540

0.04%

－

48,261

50,382

13,111

13,562

13,111

13,562Current
Financial liabilities measured atamortized cost
Short-term loans
Long-term loans to be repaid
within one year
Total
Non-current
Financial liabilities measured atamortized cost
Long-term loans
Total

0.05%

From Jun. 30,
2021 to Dec. 29,
2023

Average interest rate indicates the weighted-average interest rates applicable to borrowings at each fiscal year end.
(2) Changes in liabilities associated with cash flows from financing activities:
For the fiscal year ended March 31, 2019
(Unit: Millions of yen)
Borrowings
As of April 1, 2018

59,932

Changes in cash flow by proceeds and repayments(Decrease) increase in short-term loans, net
Proceeds from long-term loans
Repayments of long-term loans

1,948
4,000
(4,450)Total changes in cash flows from financing activities

1,498

Foreign currency translation adjustments(57)

As of March 31, 2019

61,372For the fiscal year ended March 31, 2019
(Unit: Millions of yen)
Borrowings
As of April 1, 2019

61,372

Changes in cash flow by proceeds and repayments(Decrease) increase in short-term loans, net
Proceeds from long-term loans
Repayments of long-term loans

2,632
4,000
(4,000)Total changes in cash flows from financing activities

2,632

Foreign currency translation adjustments(59)

As of March 31, 2020

63,94531

17. Provisions
The schedule of provisions is as follows:
For the fiscal year ended March 31, 2019
(Unit: Millions of yen)
Provision forcompensation
for products

Provision for loss
on litigation

As of April 1, 2018

2,727

309

68

Provision made

634

13

10

659

Provision used

(795)

(1)

(797)

Provision reversed

(22)

－
－

－

(22)

Foreign currency translation
adjustments

(0)

－

0

0

As of March 31, 2019

2,543

322

78

2,944

Current
Non-current

2,543

322

－

－

7
70

2,874
70

Other

Total
3,104

For the fiscal year ended March 31, 2020
(Unit: Millions of yen)
Provision forcompensation
for products

Provision for loss
on litigation

2,543

322

Provision made

175

Provision used

(702)

－
－

Provision reversed
Foreign currency translation
adjustments(158)

As of April1, 2019

Other

Total
78

2,944

8

183
(702)

(6)

－
－

(0)

－

(0)

(0)

As of March 31, 2020

1,858

316

85

2,260

Current
Non-current

1,858

316

－

－

13
72

2,188
72

(164)

18. Employee Benefits
The Company has both unfunded defined benefit and defined contribution plans. Its consolidated subsidiaries have funded
defined benefit, unfunded defined benefit and defined contribution plans. Funded defined benefit plans provide pensions to
the employees based on their salary and length of service. The payments of retirement allowance are also determined basedon salary and the length of service.
(1) Defined benefit plans
1) The Breakdown of defined benefit obligation and plan assets
The breakdown of defined benefit obligation and plan assets are as follows:(Unit: Millions of yen)March 31,2019

March 31,2020

Present value of funded defined benefit obligations
Fair value of plan assets

7
(1)

16
(15)

Subtotal

5

1

Present value of unfunded defined benefit
Obligations

3,384

3,513

Defined benefit obligation and assets (net)

3,390

3,514

32

2) Changes in present value of retirement benefit obligations
Changes in present value of retirement benefit obligations are as follows:(Unit: Millions of yen)
Year ended March
31,2019
Balance beginning of year
Service cost
Interest cost
Changes by remeasurement
Actuarial gain or loss arising from changes in demographic assumptions
Actuarial gain or loss arising from changes in financial assumptions
Other
Benefits paid
Past service cost
Other
Balance end of year

Year ended March
31,2020

3,540

3,392

254
63

255
60

2
(50)
8
(488)
92
(30)

4
43
(9)
(143)
35
(109)

3,392

3,529

3) Significant actuarial assumptions and sensitivity analysis
The significant actuarial assumptions are as follows:(Unit: Millions of yen)March 31,2019

March 31,2020

Discount rate

2.06%

1.74%

Salary raise percentage

4.33%

3.68%

The effects on the present value of defined benefit obligations by assuming a 0.5% increase or decrease are as follows:(Unit: Millions of yen)
Changes in assumptions
Discount rate

March 31,2019

March 31,2020

Increase of 0.5%

(90)

(118)

Decrease of 0.5%

98

122

The present values of the defined benefit obligations in cases of a 0.5% increase and decrease in the discount rate arecalculated in the same manner as used in the calculation of present values of the defined benefit obligations recognized in the
consolidated statement of financial position, and thereby, the differences from the actual present values of the defined benefit
obligations are determined as the result of the sensitivity analysis. In such analysis, it is assumed that variables other thanthe discount rate remain fixed. However, in practice, changes in some of the assumptions may occur and affect the result.
4) Information on the maturity composition of defined benefit obligations
The weighted average duration is as follows:
March 31,2019
Weighted average duration

March 31,2020

10.0 years

10.0 years5) Schedule of fair value of plan assets
The changes in fair value of plan assets are as follows:(Unit: Millions of yen)
Year ended March 31,2019Balance beginning of year
Interest income (Note)
Changes by remeasurement
Return on plan assets
Contributions by the employer
Benefits paid
Other
Balance end of year

Year ended March 31,2020
151

1

2

0

5
125
(283)
0

7
6

1

－
0
15

(Note) Interest income is measured by multiplying the fair value of plan assets at the beginning of the fiscal year by thediscount rate used for the calculation of the present value of defined benefit obligations.

336) The breakdown of fair value of plan assets by typeThe breakdown of fair value of plan assets by type is as follows:(Unit: Millions of yen)March 31,2019Plan assets thathave a quoted
price in an
active market

March 31,2020Plan assets that
do not have aquoted price inan active
marketPlan assets thathave a quoted
price in an
active market

Plan assets that
do not have aquoted price inan active
marketCash and deposits

0

－
－
－

5

－
－
－

Other

－

0

－

1

Total

1

0

13

1

Bonds

0

Stocks0167) The breakdown of defined benefit cost
The breakdown of defined benefit cost is as follows:(Unit: Millions of yen)
Year ended March 31,2019Year ended March 31,2020

Service cost
Net interest
Past service cost
Other

254
61
92

－

255
60
35
(0)

Total

408

351

These costs are included in “cost of revenue” and “selling, general and administrative expenses” in the consolidated
statement of income.
(2) Defined contribution pension plans
The amount of cost recognized during the fiscal years ended March 31, 2019 and 2020 is as follows.
(Unit: Millions of yen)
Year ended March 31,2019
Contributions

Year ended March 31,2020
3,389

3,479

The cost is included in “cost of revenue” and “selling, general and administrative expenses” in the consolidated statement ofincome and includes pension contributions by the employer under “Employees' Pension Insurance Act” in Japan.
(3) Employee benefits expenses
Employee benefits expenses included in “cost of revenue” and “selling, general and administrative expenses” in the
consolidated statement of income are as follows:.
(Unit: Millions of yen)
Year ended March 31,2019Year ended March 31,2020

Wages, salaries and bonuses, etc.
Retirement benefit expenses
Other

42,5101,505
5,700

42,240
1,503
5,816

Total

49,71649,560(4) Other employee benefits(Unit: Millions of yen)March 31,2019

March 31,2020

Short-term employee benefits
Salaries payable, etc.
Accrued bonuses
Liabilities relating to compensated absences

1,105
2,510
1,091

923
2,481
1,149

Total

4,706

4,555

Long-term employee benefits
Other

11

11

Total

11

11

34

19. Equity and Other Equity Items(1) Management of equity
The Group makes capital, research and development investments to increase corporate value through growth on a global
scale. To meet fund requirement for investments, the Group considers an appropriate balance between debts and equity andmanages equity.
(2) Number of shares authorized, issued and treasury stock(Unit: Shares)
Class of sharesYear ended March 31,2019Year ended March 31,2020

Ordinary shares

Ordinary shares

Number of shares authorized

220,000,000

220,000,000

Number of shares issued:
Beginning of year
Increase(decrease)
End of year

60,907,599－
60,907,599

60,907,599－
60,907,599

Number of treasury stock:
Ordinary shares

3,640,145

3,622,630(3) Information on surplus included in equity
1) Capital surplus
The components of capital surplus are as follows:(i) Legal capital surplus
Under the Companies Act of Japan (the "Companies Act"), at least 50% of the proceeds of certain issues of common sharesshall be credited to "Capital stock." The remainder of the proceeds shall be credited to "Capital surplus." The Companies Act
permits, upon approval at the general meeting of shareholders, the transfer of amounts from "Capital surplus" to "Capitalstock."(ii) Other capital surplus
Changes in the ownership interest in a subsidiary without a loss of control is treated as an equity transaction, and theamount equivalent to goodwill, negative goodwill, etc., incurred in connection with any such changes is recorded in othercapital surplus.
(iii) Stock acquisition rights
Stock acquisition rights are those issued for stock option remuneration plan.
2) Retained earnings
The components of retained earnings are as follows:(i) Legal retained earnings
The Companies Act provides that a 10% dividend of retained earnings shall be appropriated as "Capital surplus" or as alegal reserve until the aggregate amount of the "Capital surplus" and the legal reserve equals to 25% of "Capital stock." Thelegal reserve may be used to eliminate or reduce a deficit or be transferred to "Retained earnings" upon approval at thegeneral meeting of shareholders.
In some foreign subsidiaries local laws stipulate that dividend of retained earnings shall be appropriated as "Capitalsurplus" or as a legal reserve.
(ii) Other retained earnings
Other retained earnings represent the accumulated amount of profit earned by the Group.

35

(4) Information on other components of equity
1) Gains or losses on financial assets measured at fair value through other comprehensive income
This is the accumulated amount of changes in fair value of financial assets measured at fair value through othercomprehensive income.
2) Remeasurements of net defined benefit liabilities (assets)
Remeasurements of net defined benefit liabilities (assets) comprise actuarial gain or loss and the return on plan assets(excluding the amount included in net interest on defined benefit liabilities (assets)). Remeasurements of defined benefit
liabilities (assets), net, are recognized as other comprehensive income in the fiscal year in which they occurred and are
immediately transferred to retained earnings.
3) Foreign currency translation adjustments
This is an accumulated amount of exchange differences occurring when standalone financial statements of foreignsubsidiaries prepared in foreign currencies are translated into Japanese yen upon consolidation.
20. Dividends
For the fiscal year ended March 31, 2019(1) Cash dividends paid
Resolution

Class of
SharesTotal dividends(Millions of yen)

Dividends per
share (Yen)Record date

Effective date

Board of Directors' meeting
held on May 14, 2018

Ordinary shares

1,431

25.0

March 31, 2018

June 28, 2018

Board of Directors' meeting
held on October 29, 2018

Ordinary shares

1,145

20.0

September 30,
2018

December 12,2018(2) Dividends with a record date in the fiscal year ended March 31, 2019 and an effective date in the following fiscal year
Resolution
Board of Directors' meeting
held on May 14, 2019

Class of
SharesOrdinary shares

Total dividends(Millions of yen)
1,431

Dividends per
share (Yen)
25.0

Record date

Effective date

March 31, 2019

Jun 27, 2019

Record date

Effective date

For the fiscal year ended March 31, 2020
(1) Cash dividends paid
Resolution

Class of
SharesTotal dividends(Millions of yen)

Dividends per
share (Yen)

Board of Directors' meeting
held on May 14, 2019

Ordinary shares

1,431

25.0

March 31, 2019

Jun 27, 2019

Board of Directors' meeting
held on October 31, 2019

Ordinary shares

1,145

20.0

September 30,
2019

December 11,2019(2) Dividends with a record date in the fiscal year ended March 31, 2020 and an effective date in the following fiscal year
Resolution
Board of Directors' meeting
held on May 28, 2020

Class of
SharesOrdinary shares

Total dividends(Millions of yen)
1,145

Dividends per
share (Yen)
20.0

Record date

Effective date

March 31, 2020

Jun 29, 2019

21. Revenue(1) Disaggregation of revenue
Revenue of reportable segments by location
The Group’s primary operations are manufacture and sale of products in business of instruments for automobiles,
motorcycles, agricultural / construction machines, boats, business of component and sale of automobiles in business of
automobile sales.

36For sale of products, revenue is recognized when products are transferred to customers because control is passed tocustomers at a point in time of transfer and a performance obligation is satisfied. The Group usually receives payment from
customers within 3 months after transfer of good, i.e. the point in time at which it satisfies the performance obligation. For
sale of automobiles, revenue is recognized when automobiles are transferred to customers. The Group usually receives
payment from customers when the performance obligation is satisfied. Revenue is measured at the amount of consideration
contracted with customers excluding discounts, rebates, and refunds, etc.
Revenue of reportable segments by location is as follows:
For the fiscal year ended March 31, 2019
(Unit: Millions of yen)
Instruments

Component

Automobile sales

Others

Total

Japan

52,30011,17024,563

12,294

100,328

Americas58,507－－－58,507

Europe23,92896－－

24,024

Asia

71,501

4,188

－

4,689

80,378

Total

206,237

15,45424,563

16,983

263,239

For the fiscal year ended March 31, 2020
(Unit: Millions of yen)
Instruments

Component

Automobile sales

Others

Total

Japan

52,011

10,89322,226

12,286

97,417

Americas56,095－－－56,095

Europe20,373－－－

20,373

Asia

64,318

4,278

－

3,856

72,453

Total

192,798

15,172

22,22616,142

246,340(2) Contract balances
The Group’s contract balances are only receivables from contract with customers and disclosed in Note 8 “Trade and Other
Receivables”.
(3) Transaction price allocated to the remaining performance obligations
The Group has no significant transactions with individual expected contractual terms exceeding one year. In addition, there
are no significant amounts in consideration from contracts with customers that are not included in transaction prices.
(4) Assets recognized from the costs of obtaining or fulfilling contacts with customers
The Group has no costs of obtaining or fulfilling contracts to be recognized as assets.
22. Selling, General and Administrative Expenses
The breakdown of selling, general and administrative expenses is as follows:(Unit: Millions of yen)
Year ended March 31,2019Year ended March 31,2020

Packing and transportation expenses
Employees’ salaries
Provision of allowance for doubtful accounts
Provision for compensation for products
Retirement benefit expenses
Provision for directors’ retirement benefits
Depreciation
Other(5,762)(10,739)
(24)
(362)
(414)
(33)
(1,608)(12,886)(5,234)(10,913)
(29)
(15)
(509)
(33)
(2,590)(12,652)

Total(31,832)(31,979)37

23. Other Income and Other Expenses(1) The breakdown of other income(Unit: Millions of yen).

Year ended March 31,2019Gain on sales of non-current assets
Other
Total

Year ended March 31,2020

174
924

89
1,081

1,099

1,170

(2) The breakdown of other expenses(Unit: Millions of yen)
Year ended March 31,2019Year ended March 31,2020

Loss on sales of non-current assets
Loss on retirement of non-current assets
Impairment loss
Other

(31)
(173)
(327)
(114)

(17)
(236)
(344)
(470)

Total

(646)

(1,069)24. Finance Income and Finance Costs(1) The breakdown of finance income(Unit: Millions of yen)
Year ended March 31,2019Interest income
Financial assets measured at amortized cost
Dividend income
Financial assets measured at fair value through othercomprehensive income
Total

Year ended March 31,2020

2,047

2,443

607

604

2,654

3,047

(2) The breakdown of finance costs(Unit: Millions of yen)
Year ended March 31,2019Year ended March 31,2020Interest expenses
Borrowings
Other
Foreign exchange losses
Other

(224)
(4)
(350)
(0)

(219)
(3)
(2,928)
－-

Total

(579)

(3,151)

25. Earnings per Share(1) Basis of calculating basic earnings (losses) per share
1) Profit (loss) for the year attributable to owners of the parent company(Unit: Millions of yen)
Year ended March 31,2019Profit (loss) for the year attributable to owners of the parent company

11,569Year ended March 31,2020(350)2) Weighted average number of ordinary shares – basic(Unit: Thousands of shares)
Year ended March 31,2019
Weighted average number of ordinary shares – basic

57,26538

Year ended March 31,2020
57,280(2) Basis of calculating diluted earnings (losses) per share
1) Profit (loss) for the year attributable to owners of the parent company – diluted(Unit: Millions of yen)
Year ended March 31,2019Profit (loss) for the year attributable to owners of the parent company –dilutedYear ended March 31,2020

11,569(350)2) Weighted average number of ordinary shares –diluted(Unit: Thousands of shares)
Year ended March 31,2019
Weighted average number of ordinary shares – basic
Dilutive potential ordinary shares
Weighted average number of ordinary shares – diluted

57,265
82
57,348Year ended March 31,2020
57,280－57,280(Note) For year ended March 31, 2020, 77 thousand dilutive potential ordinary shares are not included in the calculationof diluted earnings per share because they are antidilutive.
26. Other Comprehensive Income
The amount of changes and income tax effects relating to each component of other comprehensive income for each year,
including non-controlling interests, are as follows:(Unit: Millions of yen)
Year ended March 31,2019Year ended March 31,2020

Items that will not be reclassified to profit or loss
Gains(losses) on financial assets measured at fair value through othercomprehensive income
Amount arising during the year
Tax effect(3,281)950(2,854)
834

Subtotal(2,330)(2,019)Amount arising during the year
Tax effect

40
(10)

(35)
8

Subtotal

30

(27)

2,874
2,874

(7,235)(7,235)574(9,282)Remeasurements of the net defined benefit liabilities (assets)

Items that may be reclassified to profit or loss
Foreign currency translation adjustments
Amount arising during the year
Subtotal
Total other comprehensive income (loss)

39

27. Financial Instruments(1) Capital management
The Group’s basic policy for capital management is to aim increase of corporate value while achieving a good balance between
financial stability and capital efficiency. In financial stability, assessment by credit rating agencies is one of the standards andthe Group endeavors to procure funds from external institutions with low cost by maintaining a high credit rating forlong-term borrowings.
In capital efficiency, the Group gives priority to procuring funds by debt while maintaining a high credit rating and reduces
total capital costs by restraint of capital size. The Group is not exposed to material capital restrictions by external parties.
(2) The Breakdown of financial instruments(Unit: Millions of yen)March 31,2019
Financial assets
Financial assets measured at amortized cost
Cash and cash equivalents
Trade and other receivables
Other financial assets
Financial assets measured at fair value throughother comprehensive income
Other financial assets
Financial assets measured at fair value throughprofit or loss
Other financial assets
Total
Financial liabilities
Financial liabilities measured at amortized cost
Trade and other liabilities
Loans
Other financial liabilities
Financial liabilities measured at fair value throughprofit or loss
Other financial liabilities
Total

March 31,2020

42,12848,20970,81936,65738,56972,285

19,260

16,291－

51

180,417

163,855

42,837
61,372773

34,51963,9456,242

2－104,986

104,707(3) Financial instruments risk
1) Credit risk managementi) Credit risk management
Notes, electronically recorded monetary claims and accounts receivable - trade are exposed to customer credit risk. The
Group manages credit risk arising from receivables in accordance with the internal policies, which include monitoring ofdue dates and outstanding balances by individual customer and the credit worthiness of main customers on an interim
basis.
ii) Credit risk exposure
For the fiscal year ended March 31, 2019
The carrying amount of note, electronically recorded monetary claims and trade receivables and changes in allowance for
doubtful accounts are as follows:(Unit: Millions of yen)
Financial assets for whichloss allowances are always
measured at an amountequal to expected credit
losses for the entire period

Credit-impaired financial
assetsBeginning balance

45,244045,245Ending balance

43,195043,196

Note, electronically recorded monetary claims
and trade receivables

40

Total

(Unit: Millions of yen)
Financial assets for whichloss allowances are always
measured at an amountequal to expected credit
losses for the entire period

Credit-impaired financial
assetsBeginning balance263

0Increase during the year

117

0

117

Decrease during the year
Other(Foreign currency translation adjustments)

(259)

－

(259)

(3)

－

(3)

Ending balance

117

0

117

Allowance for doubtful accounts

Total

263

For the fiscal year ended March 31, 2020
The carrying amount of note, electronically recorded monetary claims and trade receivables and changes in allowance for
doubtful accounts are as follows:(Unit: Millions of yen)
Financial assets for whichloss allowances are always
measured at an amountequal to expected credit
losses for the entire period

Credit-impaired financial
assetsBeginning balance

43,195043,196

Ending balance

34,0810

34,081

Note, electronically recorded monetary claims
and trade receivables

Total(Unit: Millions of yen)
Financial assets for whichloss allowances are always
measured at an amountequal to expected credit
losses for the entire period

Credit-impaired financial
assetsBeginning balance

117

0

117

Increase during the year

140

0

140

Decrease during the year
Other(Foreign currency translation adjustments)

(110)

－

(110)

(6)

－

(6)

Ending balance

140

0

140

Allowance for doubtful accounts

Total2) Liquidity risk
Payment terms of payables, such as notes and accounts payable-trade, are mostly less than one year.
Short-term loans are used mainly in connection with business activities. Long-term loans and leases are taken out
principally for the purpose of capital investments.
Trading liabilities and borrowings are exposed to liquidity risk. The Group prepares and updates cash flow plans monthly to
manage liquidity risk.
Financial liabilities by maturity are as follows:41

For the fiscal year ended March 31, 2019
(Unit: Millions of yen)

Financialliabilities
measured atamortized cost
Trade and otherliabilities
Long-term loans
due after morethan one year
Long -termloans due within
one year
Short-termloansLong-termleasesShort-termleasesFinancialliabilities
measured at fairvalue throughprofit and loss
Derivative
liabilities
Total

Carrying
amountContractual
cash flows

Within one
year

More than
one yearwithin two
years

More than
two years
withinthree years

More than
three years
within fouryears

More thanfour years
within fiveyears

More than
five years

42,837

42,837

42,837

－

－

－

－

－

13,111

13,129

－

2,418

6,529

1,178

3,002

－

3,750

3,755

3,755

－

－

－

－

－

44,51044,65444,654

－

－

－

－

－

578

594

－

196

171

135

89

2

195

204

204

－

－

－

－

－

2

2

2

－

－

－

－

－

104,986

105,178

91,454

2,614

6,700

1,314

3,091

2

A financial asset and a financial liability arising from derivative transactions are offset and the net amount is presented.
For the fiscal year ended March 31, 2020
(Unit: Millions of yen)

Financialliabilities
measured atamortized cost
Trade and otherliabilities
Long-term loans
due after morethan one year
Long -termloans due within
one year
Short-termloansLong-termleasesShort-termleases
Total

Carrying
amountContractual
cash flows

Within one
year

More than
one yearwithin two
years

More than
two years
withinthree years

More than
three years
within fouryears

More thanfour years
within fiveyears

More than
five years

34,51934,51934,519

－

－

－

－

－

13,562

13,575

－

7,768

2,054

3,752

－

－

3,540

3,542

3,542

－

－

－

－

－

46,842

46,98946,989

－

－

－

－

－

4,266

4,276

－

1,740

1,268

957

174

134

1,976

1,984

1,984

－

－

－

－

－

104,707

104,888

87,036

9,508

3,322

4,710

174

134

A financial asset and a financial liability arising from derivative transactions are offset and the net amount is presented.

423) Market risk management(i) Foreign exchange risk
The Group’s main foreign exchange risk arises mainly from the Company’s US dollar deposit aiming at settlement fortransactions with overseas customers and suppliers. Therefore the Company mainly has the exchange risk. If the Japanese
yen as a functional currency in the Company appreciates by 1% against the U.S. dollar at the fiscal year-end, effects on
profit before tax by the translation of the Company’s US dollar deposit are as follows.
It is assumed that currencies other than the exchange rate between the U.S. dollar and Japanese yen are fixed.
Foreign currency sensitivity analysis(Unit: Millions of yen)
Year ended March 31, 2019Year ended March 31, 2020

Profit before tax

(129)

(79)

The above amount in parentheses shows negative effects on profit before tax if the yen appreciated 1% against the dollar
and the effects would be positive if the yen depreciated 1% against the dollar.
The effects on other comprehensive income by translation of foreign subsidiaries are not included.
(ii) Interest rate risk
The Group raises funds through bank borrowings and is exposed to interest rate risk. To hedge the risk, the Groupendeavors to fix financial cost by long-term borrowings and performs good cash flow management to receivables andpayables. As a result, the effects on interest expenses by interest rate change are insignificant.
(4) Equity instruments measured at fair value through other comprehensive income
The Group holds listed and unlisted shares with business relationship and these equity instruments are measured at fairvalue through other comprehensive income because the purpose of holding these equity instruments is to maintain andstrengthen business relationship.
1) Main shares and fair value
Main shares and fair value for the year ended March 31, 2019 and 2020 are as follows:(Unit: Millions of yen)Company nameMarch 31, 2019

Honda Motor Co., Ltd.
NICHIA CORPORATION
Yamaha Motor Co., Ltd.
SUZUKI MOTOR CORPORATION
Mitsubishi UFJ Financial Group, Inc.
Daishi Hokuetsu Financial Group, Inc.
THE TAIKO BANK，LTD．

March 31, 2020
10,582
5,058
1,458
484
245
167
130
127
128
71

SUBARU CORPORATIONThe First Bank of Toyama, Ltd.
Mitsubishi Electric Corporation

8,644
5,257
878
255
179
126
115
104
102
66

2) Derecognized equity instruments measured at fair value through other comprehensive income
Fair value and cumulative profit and loss before tax of derecognized equity instruments measured at fair value throughother comprehensive income for the year ended March 31, 2019 and 2020 are as follows:(Unit: Millions of yen)
Year ended March 31,2019Year ended March 31,2020

Fair value at the date of derecognition

7

181

Cumulative profit or loss on disposal

(8)

94

(Note)
1. Due to change in business relationship, the Group derecognized some equity instruments measured at fair value throughother comprehensive income by selling them in the fiscal year 2019 and 2020.

43

2. When equity instruments measured at fair value through other comprehensive income are derecognized, cumulative
profit or loss after tax on other comprehensive income are reclassified into retained earnings.
3) Dividend income
The breakdown of dividend income arising from equity instruments measured at fair value through other comprehensive
income is as follows:(Unit: Millions of yen)
Year ended March 31,2019
Derecognized equity instruments in the year
Equity instruments held at year end

Year ended March 31,2020
0

－

588

587

4) Market volatility sensitivity analysis
The Group holds equity instruments, such as shares of listed companies with which the Group has a business relationship,
and these equity instruments are exposed to market volatility risk. The current fair value of the equity instruments and thefinancial status of issuers are assessed regularly and holding status is reviewed periodically.
Sensitivity analysis to market volatility of financial instruments is as follows:
It is based on the assumption that all parameters other than the share prices used for the calculation do not fluctuate andshows the impact on other comprehensive income (before tax effects), if the share prices of these instruments decline 10% at
the fiscal year-end.
(Unit: Millions of yen)
Year ended March 31,2019
Other comprehensive income

Year ended March 31,2020(1,376)(1,064)(5) Fair value of financial instruments
1) Measurement of fair value(i) Financial assets measured at amortized cost(a) Cash and cash equivalents
The carrying amount approximates the fair value due to the short maturities of the instruments.
(b) Trade and other receivables
The carrying amount approximates the fair value due to the short maturities of the instruments.
(c) Loans and receivables
Time deposits with duration exceeding three months are settled within short term and the carrying amount reasonably
approximates to the respective fair value.
(ii) Financial assets measured at fair value through other comprehensive income
The fair value of listed shares is based on quoted market prices at reporting date and the fair value of unlisted shares ismainly based on net assets value.
(iii) Financial assets and financial liabilities measured at fair value through profit or loss
The fair value is based on the quoted price, etc. provided by the relevant financial institutions.
(iv) Financial liabilities measured at amortized cost(a) Short-term loan
The carrying amount approximates the respective fair value since the instruments are settled within short term.
(b) Long-term loan including loan due within one year
The instruments are calculated based on the present value by discounting the sum of the principal and interest at theinterest rate assumed for a new similar borrowing.
(c) Other liabilities
The carrying amount approximates the respective fair value since the instruments are settled within short term.

442) Fair value hierarchy
The levels of the fair value hierarchy are as follows:
Level 1 – Fair value measured using quoted prices in active markets
Level 2 – Fair value measured using inputs other than quoted prices included in Level 1 that are observable, either directly
or indirectly
Level 3 – Fair value measured using unobservable inputs
Any transfers of the financial instruments between levels are recognized at the date of events that causes the transfers.
When unobservable inputs were changed to alternative and reasonable assumptions in Level 3, significant changes of fairvalue are not considered.
3) Carrying amount and fair value of financial instruments(Unit: Millions of yen)March 31,2019
Carrying amountLong-term loans

16,862

March 31,2020

Fair value

Carrying amount

16,855

Fair value

17,10317,0964) Financial instruments measured at fair value
The clarification by level based on fair value hierarchy of financial instruments measured at fair value is as follows:
For the fiscal year ended March 31, 2019
(Unit: Millions of yen)
Level 1

Level 2

Level 3

Total

Financial assets measured at fair value throughprofit or loss

－

－

－

－

Financial assets measured at fair value throughother comprehensive income

13,786－

5,468

19,255

Total

13,786－

5,468

19,255

Financial liabilities measured at fair value
through profit or loss

－

2

－

2

Total

－

2

－

2

(Note) There is no financial asset or financial liability transferred to other level.
For the fiscal year ended March 31, 2020
(Unit: Millions of yen)
Level 1

Level 2

Level 3

Total

Financial assets measured at fair value throughprofit or loss

－

51

－

51

Financial assets measured at fair value throughother comprehensive income

10,643－

5,643

16,286

Total

10,64351

5,643

16,338Financial liabilities measured at fair value
through profit or loss

－

－

－

－

Total

－

－

－

－

(Note) There is no financial asset or financial liability transferred to other level.

455) The movement in fair value of financial assets categorized in Level 3 is as follows:(Unit: Millions of yen)
Year ended March 31, 2019Year ended March 31, 2020

Beginning balance
Total gain and loss:
Other comprehensive income
Sales
Other

5,374

5,468

103
(1)
(8)

174
－
－

Ending balance

5,468

5,643

Gains (losses) on other comprehensive income are classified as gains (losses) on financial assets measured at fair value
through other comprehensive income in consolidated statement of comprehensive income
28. Leases(1) Finance lease as lessee
The breakdown of future minimum lease payments under finance lease as at March 31, 2019 is as follows:(Unit: Millions of yen)March 31,2019
Minimum
lease
payments
Within one year
More than one year to five years
More than five years

Minimum
lease
payments atfair value

195
576
2

193
554
2

Total

773

750

Future financing cost

(22)

Total minimum lease payments at fair
value

750

(2) Operating lease as lessee
1) Future minimum lease payments
The breakdown of future minimum lease payments under non-cancellable operating lease as at March 31, 2019 is as follows:(Unit: Millions of yen)March 31,2019Within one year
More than one year to five years
More than five years

201
413
14

Total

629

The Group leases vehicles, etc. and some lease contracts cover the right for renewal.
2) Operating lease payments recognized as an expense
Operating lease payments recognized as an expense are as follows:(Unit: Millions of yen)
Year ended March 31,2019
1,560

46

(3) Amounts recognized in consolidated statement of income and cash flows relating to lease transaction
Amounts recognized in consolidated statement of income and cash flows relating to lease transaction are as follows;(Unit: Millions of yen)
Year ended March 31, 2020
Depreciation charge for right-of-use-assets
Land, buildings and structures as underlying assets
1,332
Machinery and equipment, vehicles as underlying assets
306
Tools, furniture and fixtures as underlying assets
46
Intangible assets and other as underlying assets
11
Total
1,696
Lease expenses relating to short-term leases accounted for applying
exemptions
407
Lease expenses relating to lease of low-value assets accounted for applying
exemptions
223
Interest expenses on lease liabilities
11
Total cash flows for leases are as follows;(Unit: Millions of yen)
Year ended March 31, 2020
1,861

Total cash flows for leases(4) Extension options and termination options (as a lessee)

In the Group, each group company has responsibility for its lease management and lease conditions are negotiated individuallyand different by contract.
Extension options and termination options are mainly included in contracts of leases relating to buildings and structures. Manyof them are leases with extension options over same terms as contracts or leases with termination options in which the Groupcan cancel the contracts prior to the end of the original lease term when the Group notifies a lessor of the termination by the
specified expiration date.
(5) Additions to right-of-use-assets
Additions to right-of-use-assets are as follows;(Unit: Millions of yen)
Year ended March 31, 2020
1,750

Additions to right-of-use-assets(6) The carrying amount of right-of-use-assets
The carrying amount of right-of-use-assets is as follows;(Unit: Millions of yen)
April 1, 2019

Land, buildings and structures as underlying assets
Machinery and equipment, vehicles as underlying assets
Tools, furniture and fixtures as underlying assets
Intangible assets and other as underlying assets
Total

March 31, 2020

6,023
763
627
63
7,477

47

5,124
812
672
43
6,652

29. Subsidiaries
The consolidated subsidiaries of the Group as at March 31, 2020 are as follows:
Company nameLocation

Voting rights (%)

NS Advantech Co., Ltd.

Niigata prefecture, Japan

100.0

N.S.Electronics Co., Ltd.

Niigata prefecture, Japan

100.0

NS West Inc.

Hiroshima prefecture, Japan

100.0

NS･Computer Service Co., Ltd.

Niigata prefecture, Japan

100.0

Nissei Service Co., Ltd.

Niigata prefecture, Japan

100.0

Honda Car Sales Nagaoka Co., Ltd.

Niigata prefecture, Japan

100.0

Niigata Mazda Co., Ltd.

Niigata prefecture, Japan

100.0

UK-NSI Co., Ltd.

United Kingdom

100.0

Nippon Seiki (Europe)B.V.

Netherlands

New Sabina Industries, Inc.

U.S.A.

100.0 (7.9)

N.S.International, Ltd.

U.S.A.

100.0

Nippon Seiki De Mexico S.A. De C.V.

Mexico100.0 (20.5)

Nissei Advantech Mexico S.A. De C.V.

Mexico100.0 (95.59)

Nippon Seiki Do Brasil Ltda.

Brazil

100.0

Thai Nippon Seiki Co., Ltd.

Thailand

100.0

PT.Indonesia Nippon Seiki

Indonesia

70.0

Vietnam Nippon Seiki Co., Ltd.

Vietnam

70.0

NS Instruments India Private Ltd.

India

100.0 (1.0)

Hong Kong Nippon Seiki Co., Ltd.

Hong Kong

100.0 (30.0)

Dongguan Nissei Electronics Co., Ltd.

China

100.0 (30.0)

Shanghai Nissei Display System Co., Ltd.

China

80.0 (80.0)

Taiwan Nissei Display System Co., Ltd.

Taiwan100.0

Nantong NS Advantech Co., Ltd.

China

100.0 (100.0)

Wuhan Nissei Display System Co., Ltd.

China

75.0

Nissei Display Sales and Development Co., Ltd.

China

91.0 (31.0)

100.0

－

Other 10 companies－(Note) The percentages in parentheses in the column of "Voting rights (%)" indicate indirect ownership out of the total
ownership.
30. Related parties
Management emoluments
Emoluments for the Company’s directors and corporate auditors are as follows:(Unit: Millions of yen)
Year ended March 31,2019Year ended March 31,2020

Basic emolument and bonus
Share-based Payment

381
14

302
13

Total

396

315

48

31. Share-based Payment(1) Stock option remuneration plans
The Company adopts the stock option remuneration plans as described below.
Issuer

The Company

The Company

The Company

The Company

Date of resolution
at the Board of
Directors’ Meeting

June 28, 2011

June 27, 2012

June 25, 2013

June 26, 2014

Grantees

Directors

Class and numberof granted shares

Ordinary shares
24,700 shares

Ordinary shares
30,400 shares

Ordinary shares
13,900 shares

Ordinary shares
12,200 shares

Grant dateJuly 19, 2011

July 19, 2012

July 18, 2013

July 17, 2014

Vesting Conditions

No condition is set out.

No condition is set out.

No condition is set out.

No condition is set out.

Service period

No service period is
stipulated.

No service period is
stipulated.

No service period is
stipulated.

No service period is
stipulated.

Exercisable period

From July 20, 2011 toJuly 19, 2041

From July 20, 2012 toJuly 19, 2042

From July 19, 2013 toJuly 18, 2043

From July 18, 2014 to
July 17, 2044

Issuer

The Company

The Company

The Company

The Company

Date of resolution
at the Board of
Directors’ Meeting

June 26, 2015

June 28, 2016

June 28, 2017

June 27, 2018

Grantees

Directors
7
Operating Officers 12

Directors
6
Operating Officers 14

Directors
Operating Officers

Class and numberof granted shares

Ordinary shares
8,300 shares

Ordinary shares
13,800 shares

Ordinary shares
9,000 shares

Ordinary shares
8,800 shares

Grant dateJuly 17, 2015

July 20, 2016

July 20, 2017

July 20, 2018

Vesting Conditions

No condition is set out.

No condition is set out.

No condition is set out.

No condition is set out.

Service period

No service period is
stipulated.

No service period is
stipulated.

No service period is
stipulated.

No service period is
stipulated.

Exercisable period

From July 18, 2015 toJuly 17, 2045

From July 21, 2016 toJuly 20, 2046

From July 21, 2017 toJuly 20, 2047

From July 21, 2018 to
July 20, 2048

Issuer

The Company

Date of resolution
at the Board of
Directors’ Meeting

June 26, 2019

Grantees

Directors
Operating Officers

Class and numberof granted shares

Ordinary shares
10,600 shares

Grant dateJuly 19, 2019

Vesting Conditions

No condition is set out.

Service period

No service period is
stipulated.

Exercisable period

From July 20, 2019 toJuly 17, 2049

15

Directors

14

6
6

49

Directors

13

7
4

Directors

15

Directors
Operating Officers

7
4

The stock options outstanding as of March 31, 2019 and 2020 are as follows:
For the fiscal year ended March 31, 2019
Weighted-average exercise
price(Yen)

Number of options (Share)
Beginning balance

77,300Granted

8,800

1

Forfeited－－

Exercised(3,000)

1－－

ExpiredEnding balance
Options exercisable at the end of year1

83,1001－－(Note) The weighted-average stock price of options as of the date of exercising, which was exercised in the reporting period, is ¥2,060.

For the fiscal year ended March 31, 2020
Weighted-average exercise
price(Yen)

Number of options (Share)
Beginning balance

83,100Granted

10,6001

Forfeited－－

Exercised(17,600)

1－－

ExpiredEnding balance
Options exercisable at the end of year1

76,1001－－(Note) The weighted-average stock price of options as of the date of exercising, which was exercised in the reporting period, is ¥1,958.

(2) Measurement approach for fair value of stock options
The fair value of stock options is estimated using the Black-Scholes model. The fair value and assumptions used in thecalculation are as follows.
Year ended March 31,2019
Fair value per stock at measuring date (Yen)Year ended March 31,2020

1,470.28

1,501.50

Share price at grant date (Yen)－－

Exercise price (Yen)

1

1

32.31

33.29

Expected remaining life of the option (years)

3.5

4.5

Expected dividend (Yen)

42

45

Risk-free interest rate (%)(0.11)(0.21)

Expected volatility of the share price (%)(3) Share-based compensation recorded in consolidated statement of income(Unit: Millions of yen)
Year ended March 31,2019
Share-based compensation
administrative expenses

recordedin

Selling,

generalandYear ended March 31,2020

18

18

32. Commitments
Contractual commitments for the acquisition of property, plant, equipment and intangible assets are as follows:(Unit: Millions of yen)March 31,2019
Contractual commitments for the acquisition of property, plant,
equipment and intangible assets

50

March 31,2020
6,765

8,103

33. Additional information
According to the spread of coronavirus, the Group estimates impacts such as sales decrease by governments’ lockdown andshutdown in customers’ factories in consolidated results for the fiscal year ended March 31, 2021. In accounting estimates suchas judgement of recoverability of deferred tax assets, the Group expects strong headwinds in first quarter and gradual
recoveries from second quarter to fourth quarter based on the latest available information.
Due to high uncertainty of assumption under the coronavirus pandemic, changes on ending time of the coronavirus and thesize of impact to economy may have an effect on consolidated financial position and income for the fiscal year ended March 31,
2021 even though the Group believes that the estimates are best estimates at this time.

51

Ⅳ. OUTLINE OF THE COMPANY● Company name: Nippon Seiki Co., Ltd.

● Established: December 24, 1946

● Common stock: 14,494,287,162 Yen● Number of employees: 1,858

As of March 31, 2020

● Main products and activities ( Nippon Seiki Group )・Automotive instruments
・Head-up displays ※・Motorcycle instruments
・Instruments for agricultural and construction
machines and boats
・Sensors for automobiles
・Control panels for office equipment
・Remote controllers for air conditioners andhousing and facility equipment
・PCB assemblies for amusements

・EMS of high-density mounting boards
・Automobile sales
・Aftermarket car products
・Liquid crystal display panels and modules
・Organic light emitting diode display panels andmodules・Resin material processing and sales・Freight transportation
・Software development
etc.

Note:
※ "Head-up displays (HUD)" use projection technology to display vehicle information on thewindshield.
● Offices and Factories
・Head office and Factory
2-34, Higashi-Zaoh 2-chome, Nagaoka-shi, Niigata, 940-8580 JAPAN・Takami Division
2-8, Higashi-Takami 2-chome, Nagaoka-shi, Niigata, 940-0006 JAPAN・NS Technical Center
2-8, Higashi-Takami 2-chome, Nagaoka-shi, Niigata, 940-0006 JAPAN・NS Tokyo Technical Center
Tabata Asuka Tower4F, 1-1, Tabata 6-chome, Kita-ku, Tokyo, 114-0014 JAPAN・Iwate Software-design Satellite Office
Takizawa-Shi IPU Daiichi Innovation Center 201, 152-378 Sugo, Takizawa-Shi, Iwate, 020-0611 JAPAN・Research & Development Center
190-1, Fujihashi 1-chome, Nagaoka-shi, Niigata, 940-2141 JAPAN・Tokyo Research & Development Center
Tabata Asuka Tower17F, 1-1, Tabata 6-chome, Kita-ku, Tokyo, 114-0014 JAPAN・Offices
Utsunomiya, Tokyo, Hamamatsu, Nagoya, Suzuka, Osaka, Mizushima, Kumamoto
・Branch OfficeHong Kong
Notes:※ Tokyo Research & Development Center was established in October, 2019.

52

Worldwide Network● Japan
・NS Advantech Co., Ltd. / Ojiya-shi, Niigata, Japan
・N.S. Electronics Co., Ltd. / Nagaoka-shi, Niigata, Japan・NS WEST Inc. / Shobara-shi, Hiroshima, Japan
・N.S.Computer Service Co., Ltd. / Nagaoka-shi, Niigata, Japan・Nissei Service Co., Ltd. / Nagaoka-shi, Niigata, Japan・Honda Car Sales Nagaoka Co., Ltd. / Nagaoka-shi, Niigata, Japan・Niigata Mazda Co., Ltd. / Niigata-shi, Niigata, Japan・Mazda Mobility Niigata Co., Ltd. / Niigata-shi, Niigata, Japan
・Car Station Niigata Co., Ltd. / Nagaoka-shi, Niigata, Japan・Nissei Kyusyoku Co., Ltd. / Nagaoka-shi, Niigata, Japan● The Americas
・New Sabina Industries, Inc. / Sabina, Ohio, U.S.A.
・N.S. International, Ltd. / Troy, Michigan, U.S.A.
・Nippon Seiki De Mexico S.A. De C.V. / Nuevo Leon, Mexico
・Nissei Advantech Mexico S.A. De C.V. / Nuevo Leon, Mexico
・Nissei Display Mexico, S.A. de C.V. / Nuevo Leon, Mexico
・Nippon Seiki Do Brasil Ltda. / Manaus, Amazonas, Brazil
・NS Sao Paulo Componentes Automotivos Ltda. / Sao Paulo, Brazil● Europe
・UK-NSI Co., Ltd. / Redditch, Worcs, U.K.
・Nippon Seiki (Europe) B.V. / North Holland, Netherlands
・Nippon Seiki Poland Sp. z o.o. / Lodz, Pland● Asia・Thai Nippon Seiki Co., Ltd. / Chonburi, Thailand
・Thai Matto NS Co., Ltd. / Chonburi, Thailand
・Nippon Seiki Consumer Products (Thailand) Co., Ltd. / Chonburi, Thailand
・PT. Indonesia Nippon Seiki / Banten, Indonesia
・Vietnam Nippon Seiki Co., Ltd. / Hanoi, Vietnam
・DaNang Nippon Seiki Co., Ltd. / DaNang city, Vietnam
・NS Instruments India Private Ltd. / Andhara Pradesh, India
・Hong Kong Nippon Seiki Co., Ltd. / Hong Kong, China
・Dongguan Nissei Electronics Co., Ltd. / Dongguan, Guangdong, China
・Shanghai Nissei Display System Co., Ltd. / Shanghai, China
・Wuhan Nissei Display System Co., Ltd. / Hubei, China
・Nissei Display Sales and Development Co., Ltd. / Shanghai, China
・Taiwan Nissei Display System Co., Ltd. / Taipei, Taiwan R.O.C.
・Nantong NS Advantech Co., Ltd. / Nantong, Jiangsu, China
・Hong Kong Ek Chor Nissei Co., Ltd. / Hong Kong, China
・JNS Instruments Ltd. / Haryana, India

53

Nippon Seiki Co., Ltd.
NS Advantech Co., Ltd.
N.S. Electronics Co., Ltd.
NS WEST Inc.
N.S.Computer Service Co., Ltd.
Nissei Service Co., Ltd.
Honda Car Sales Nagaoka Co., Ltd.
Niigata Mazda Co., Ltd.
Mazda Mobility Niigata Co., Ltd.
Car Station Niigata Co., Ltd.
Nissei Kyusyoku Co., Ltd.

Wuhan Nissei Display System Co., Ltd.
Nantong NS Advantech Co., Ltd.
Nippon Seiki (Europe) B.V.
Nissei Display Sales andNippon Seiki Poland Sp. z o.o.
Development Co., Ltd.

UK-NSI Co., Ltd.

New Sabina Industries, Inc.
N.S. International, Ltd.

Shanghai Nissei Display
System Co., Ltd.

Hong Kong Nippon Seiki
Co., Ltd.
Hong Kong Ek Chor
Nissei Co., Ltd.
Dongguan Nissei
Electronics Co., Ltd.

JNS Instruments
Ltd.

Nissei Display Mexico,
S.A. de C.V.
Nissei Advantech
Mexico S.A. De C.V.
Nippon Seiki De
Mexico S.A. De C.V.
Nippon Seiki Do Brasil Ltda.

NS Instruments India Private Ltd.

NS Sao Paulo Componentes
Automotivos Ltda.

Thai Nippon Seiki Co., Ltd.
Thai Matto NS Co., Ltd.
Nippon Seiki Consumer Products (Thailand) Co., Ltd...

54

Taiwan Nissei Display
System Co., Ltd.
Vietnam Nippon Seiki
Co.,Ltd.
DaNang Nippon Seiki
Co.,Ltd.
PT. Indonesia Nippon Seiki

Ⅴ．PROFILE OF THE GROUP COMPANIESAs of March 31, 2020

Nippon Seiki Group is composed of 35 subsidiaries and 1 affiliated company. The main business of the groupis responsible for the manufacture and sale of instruments for automobiles, motorcycles, agricultural /construction machines and boats, and the manufacture and sale of liquid crystal display panels and modules,
consumer-use products, automobiles and other products. NS Group also has businesses related to transportand research & development connected with the above products. NS Group is also involved in softwaredevelopment and other services.
Details of each company in the group and its main activities are as follows:● Significant consolidated subsidiaries
Name of Company

Voting rights
equity ratio

Main trade withsubsidiaries

Main activities

NS Advantech Co., Ltd.

100.0

N.S. Electronics Co., Ltd.

100.0

NS WEST Inc.

100.0

N.S.Computer Service Co.,Ltd.
Nissei Service Co., Ltd.

100.0
100.0

Manufacture of instruments for automotive,
motorcycle, agricultural/construction machines andboats / Plastic injection molding / Compounding,coloring of plastics, and trading
Manufacture of electronic sub-assemblies for
instruments and remote controllers and motorcycle
instruments
Manufacture and sales of automotive instruments
and peripheral systems
Software development and sales/ Office automationequipment sales / Computer services
Transportation / Advertising agency

Honda Car Sales Nagaoka
Co., Ltd.
Niigata Mazda Co., Ltd.

100.0

Honda car dealer

Selling and purchasing
products
Outsourcing softwaredevelopment
Outsourcing packing
and transporting
products
Purchasing cars

100.0

Mazda car dealer

Purchasing cars

UK-NSI Co., Ltd.

100.0

Selling products

Nippon Seiki (Europe) B.V.

100.0

New Sabina Industries, Inc.

100.0

Manufacture of automotive and motorcycle
instruments
Sales of products manufactured by Nippon Seiki
Group in the European market
Manufacture of automotive instruments

N.S. International, Ltd.

100.0

Selling products

Nippon Seiki De Mexico S.A.
De C.V.

100.0

Nissei Advantech Mexico
S.A. De C.V.
Nippon Seiki Do Brasil
Ltda.
Thai Nippon Seiki Co., Ltd.

100.0

Sales of products manufactured by Nippon Seiki
Group in the North American market
Manufacture of electronic sub-assemblies forautomotive
instruments
andautomotive
instruments
Manufacture and sales of parts for automotive
instruments
Manufacture and sales of motorcycle instruments

Selling and purchasing
products

PT. Indonesia Nippon Seiki

70.0

Vietnam Nippon Seiki Co.,Ltd.
NS Instruments India
Private Ltd.

70.0

Manufacture and sales of automotive andmotorcycle instruments / Manufacture of control
panels for office automation equipment and remotecontrollers for air conditioners and household
equipment
Manufacture and sales of automotive andmotorcycle instruments
Manufacture and sales of motorcycle instruments
Manufacture and sales
motorcycle instruments

Selling products

100.0
100.0

100.0

55

of

automotive

andPurchasing products
and component parts

Purchasing products
and component parts

Selling products
Selling products

Selling products

None
Selling products

Selling products
Selling products

Name of Company

Voting rights
equity ratio

Hong Kong Nippon Seiki
Co., Ltd.

100.0

Dongguan Nissei Electronics
Co., Ltd.

100.0

Shanghai Nissei Display
System Co., Ltd.

80.0

Taiwan Nissei Display
System Co., Ltd.
Nantong NS Advantech Co.,Ltd.
Wuhan Nissei Display
system Co., Ltd.
Nissei Display Sales andDevelopment Co., Ltd.
And 10 companies

Main trade withsubsidiaries

Main activities
Sales of control panels for office automationequipment and remote controllers for air
conditioners and household equipment
Manufacture of control panels for office automationequipment and remote controllers for air
conditioners and household equipment
Manufacture and sales of automotive andmotorcycle instruments

Purchasing and selling
products

100.0

Manufacture and sales
motorcycle instruments

Selling products

100.0

Compounding, and coloring of plastics, and trading

75.0

Manufacture of automotive instruments

91.0

Sales of products manufactured by Nippon Seiki
Group in the Chinese market

ofautomotiveand● The affiliated company is as follow:
・Affiliated company (which does not influence the consolidated financial statements)
・JNS Instruments Ltd.

56

Selling products

Selling products andpurchasing component
parts

Purchasing component
parts
Selling products
Selling products

Ⅵ. OWNERSHIP OF THE COMPANY’S SHARESAs of March 31, 2020

2,497 shareholders, in total, hold the company’s common shares.
Details of the issued shares and shareholders are as follows:・ Total number of authorized shares: 220,000,000 shares・ Total number of issued shares: 60,907,599 shares● Major shareholders(1,000 shares)
Shares owned(percentage ofshareholdings)

Name
Honda Motor Co., Ltd.

3,753 (6.55%)

JP MORGAN CHASE BANK 385632

2,816 (4.91%)

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

2,593 (4.52%)

MUFG Bank, Ltd.

1,779 (3.10%)

The Daishi Bank, Ltd.

1,568 (2.73%)

The Master Trust Bank of Japan, Ltd.

1,303 (2.27%)

Shareholding association of Nippon Seiki Employees

1,241 (2.16%)

Yamaha Motor Co., Ltd.

1,217 (2.12%)

Nichia Corporation

1,188 (2.07%)

Mitsui Sumitomo Insurance Co., Limited

1,082 (1.88%)

Notes:※1 Percentage of shareholdings ratio is calculated by deducting 3,622,630 shares of treasury stocks fromtotal shares issued.
※2 Nippon Seiki holds treasury stocks (3,622,630 shares), but this has not been included in the above
major shareholders’ information.
● Distribution ratio by type of shareholder

Individuals
etc.
21.96%● Distribution ratio by number of shares of total
CapitalBanks
26.35%

From under
100 to 9,999
shares
5.80%

Securities
Companies
0.25%

Foreign
Corporations
etc.
38.00%

Other
Corporations
13.44%

500,000
shares andover
65.43%

From 10,000
to 49,999
shares
5.76%

From 50,000
to 99,999
shares
3.79%

From 100,000
to 499,999
shares19.22%

Note:※ Nippon Seiki has issued share acquisition rights in the form of stock options for a stock-based
compensation plan to the company’s directors.

57

Ⅶ．BOARD OF DIRECTORS AND AUDIT AND SUPERVISORY COMMITTEE MEMBERS
As of June 26, 2020

Directors〈Name〉

President, Chief Executive Officer and Representative
Koichi Sato
Director
Managing Officer and Director
Yuji Hirata
Managing Officer and Director

Masatoshi Azuma

Managing Officer and Director

Yuji Osaki

Senior Advisor and Director

Shoji Nagai

Director
Makoto Okawa
Director who is Audit & Supervisory Committee Member
Haruhiko Otaki(Full-time)

Director who is Audit & Supervisory Committee Member(Full-time)
Director who is Audit & Supervisory Committee Member(Outside Director)
Director who is Audit & Supervisory Committee Member(Outside Director)
Director who is Audit & Supervisory Committee Member(Outside Director)
Director who is Audit & Supervisory Committee Member(Outside Director)

58

Tatsuya Nagai
Etsuo Saiki
Eiko Tomiyama
Ryuichi Shimamune
Kiyoshi Suzuki