Note: This is an excerpt translation of the “Kessan Tanshin” for the convenience of overseas stakeholders.
In cases where any differences occur between the English version and the original Japanese version, theJapanese version shall prevail. F-TECH INC. assumes no responsibility for this translation or for direct,
indirect or any other forms of damages arising from the translation.

Consolidated Financial Results
for the Nine Months Ended December 31, 2018
<under Japanese GAAP>

F-TECH INC.
19, Showanuma, Shobu-cho, Kuki City, Saitama, JAPAN1. Qualitative information regarding financial results for the period under review(1) Information regarding operating results
The global economy in the nine months ended December 31, 2018 has continued a recovery trend overall,but future uncertainty has increased due to the expansion of trade frictions between the United States andChina. The Japanese economy maintained a course of moderate recovery, in spite of the impacts of aseries of multiple natural disasters. Overseas, the economy in the United States continued to expand,backed by a favorable employment and income environment and tax breaks. While in China, downsiderisks are primarily associated with the effect of trade frictions between the United States and China,
among other reasons. The economies of other regions in Asia remained firm.
In the automotive industry, in Japan, while sales were strong for light vehicles, the number of registeredvehicle declined. In North America, the shift in demand toward compact trucks continued and passenger
car sales declined. In China, there were signs of changes in the market and total sales volume started todecline. Sales remained stable overall in other Asian regions.
Under these circumstances, the Group has been working to provide its customers with new value, and has
made efforts to increase orders in accordance with the basic policies of “Back to Basics” and “Challengefor New” outlined in the 13th Mid-term plan.
Amid such circumstances, the operating results for the Group during the nine months under review are asfollows. The Group benefited mainly from mass production effects of products for newly awarded
contracts in the North American market. Net sales rose by 7.2% year on year to 175,622 million yen.
While operating profit decreased by 13.2% year on year to 4,619 million yen due mainly to a decrease intooling sales, ordinary profit decreased by 3.8% year on year to 4,362 million yen, and profit attributableto owners of parent decreased by 34.7% year on year to 2,284 million yen.
Operating results by segment are as follows.
(Japan)Favorable sales due to an increase in production volumes of the major customers led to net sales risingby 16.4% year on year to 24,483 million yen. However, the segment recorded an operating profit of 824
million yen, down by 46.4% year on year due to a decrease in tooling sales for overseas group companies.
(North America)
Net sales rose by 6.3% year on year to 101,760 million yen primarily due to the impact of the newly
awarded contracts that were concluded in the previous year and fully contributed to sales from the startof the current fiscal year. The segment recorded an operating loss of 492 million yen (an operating loss of319 million yen was recorded in the same period of the previous year) primarily due to a decrease intooling sales, changes in sales composition of products of customers, and rise in raw material costs due tothe effect of the U.S. trade policies. However, compared to the previous fiscal year, the third quarter
ended December 31, 2018 saw a recovery mainly as a result of initiatives to improve the production
efficiency and reduce costs.
(Asia)
Due to firm sales mainly to major customers, net sales rose by 5.1% year on year to 49,378 million yen
and operating profit decreased by 0.1% year on year to 3,981 million yen.
(2) Information regarding financial position
As of December 31, 2018, total assets decreased by 12,958 million yen compared with the end of theprevious fiscal year to 137,467 million yen, mainly reflecting decreases in notes and accounts receivable- trade, merchandise and finished goods, work in process, machinery, equipment and vehicles, andconstruction in progress.
Liabilities decreased by 13,952 million yen from the end of the previous fiscal year to 80,421 million yen,mainly reflecting decreases in notes and accounts payable - trade and loans payable of 9,956 million yen
as a result of reducing interest-bearing debts.
Net assets increased by 994 million yen from the end of the previous fiscal year to 57,046 million yen
mainly reflecting an increase in retained earnings.
(3) Information regarding consolidated earnings forecasts and other forward-looking statements
Taking recent performance trends into consideration, the Company has not revised its consolidated
earnings forecasts for the fiscal year ending March 31, 2019, which were announced in “Consolidated
Financial Results for the Six Months Ended September 30, 2018” on November 7, 2018.
-1-2. Quarterly consolidated financial statements and significant notes thereto(1) Consolidated balance sheets(Millions of yen)
As of March 31, 2018

As of December 31, 2018

5,871
39,209
5,406
4,740
9,321
4,139
68,6897,794
32,168
3,786
4,192
9,504
2,537
59,98418,01039,333
5,094
10,55972,998397

17,814
37,126
3,421
10,623
68,986
370

6,240
2,115
(13)
8,341
81,737150,426

6,098
2,041
(13)
8,126
77,483
137,467

22,32019,391
13,454791
98
9,193
65,25019,967
12,63013,214
456
103
8,054
54,42825,348
99
990
61
2,623
29,123
94,374

22,392
101
993
57
2,448
25,99380,421

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
Construction in progress
Other, net
Total property, plant and equipment
Intangible assets
Investments and other assets
Investment securities
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assetsTotal assets
Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term loans payable
Current portion of long-term loans payable
Income taxes payable
Provision for directors’ bonuses
Other
Total current liabilities
Non-current liabilities
Long-term loans payable
Provision for directors’ retirement benefits
Net defined benefit liability
Negative goodwill
Other
Total non-current liabilities
Total liabilities-2-(Millions of yen)
As of March 31, 2018
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets-3-

As of December 31, 2018

6,790
7,222
25,662(18)
39,656

6,790
7,222
27,573(18)
41,567

792

427

168
(445)
515
15,87956,051
150,426

(245)
(344)
(162)
15,641
57,046
137,467(2) Consolidated statements of income and comprehensive income(Millions of yen)
Nine months ended
December 31, 2017
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Share of profit of entities accounted for using equity
methodForeign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of non-current assets
Other
Total extraordinary income
Extraordinary losses
Loss on sales of non-current assets
Loss on retirement of non-current assets
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit attributable toProfit attributable to owners of parent
Profit attributable to non-controlling interests
Other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests-4-

Nine months ended
December 31, 2018

163,802145,742
18,06012,7395,321

175,622
158,463
17,15812,538
4,619

63
35

60
43

214

280

–
153
466

126
186
698

821
307
121
1,250
4,537

908
–
46
955
4,362

39
–
39

13
0
13

0
56
57
4,519
1,173
(814)
358
4,160

5
41
47
4,329
1,491
60
1,552
2,777

3,500
659

2,284
492

157
1,324
85

(243)
(620)
99(139)

(106)

1,427
5,587(871)
1,906

4,431

1,606

1,156300

(3) Notes to quarterly consolidated financial statements
Uncertainties of entity’s ability to continue as going concern
Not applicable.
Substantial changes in the amount of shareholders’ equity
Not applicable.
Application of special accounting for preparing quarterly consolidated financial statements
Tax expenses in the quarterly consolidated financial statements for a portion of consolidated subsidiaries
are calculated first by reasonably estimating the effective tax rate after applying tax effect accounting
against profit before income taxes for the fiscal year including the third quarter ended December 31, 2018,
and next by multiplying the quarterly profit (loss) before income taxes by such estimated effective tax rate.
Segment information, etc.
Segment information
I.
Nine months ended December 31, 2017
1. Disclosure of net sales and profit for each reportable segment(Millions of yen)
Reportable segments
JapanNet sales
Net sales to external customers
Transactions with other segments
Total
Segment profit (loss)

2.

Asia

Total

21,04014,01095,772
1,183

46,9892,392

163,802
17,58635,051

96,95549,382

181,389

1,538(319)

3,984

5,203

Differences between total amounts of profit (loss) for reportable segments and amounts in theconsolidated statements of income and comprehensive income and main details of these differences(matters relating to difference adjustments)(Millions of yen)AmountProfitReportable segments total

5,203

Elimination of intersegment transactions

118

Operating profit in the consolidated statements ofincome and comprehensive income

3.

North America

5,321Disclosure of impairment loss on non-current assets and goodwill, etc. for each reportable segment
Not applicable.

-5-II. Nine months ended December 31, 2018
1. Disclosure of net sales and profit for each reportable segment(Millions of yen)
Reportable segments
JapanNet sales
Net sales to external customers
Transactions with other segments
TotalSegment profit (loss)

2.

North America

Total

24,483
9,288

101,760
1,231

49,378
2,563

175,622
13,082

33,771

102,992

51,941

188,705

824

(492)

3,981

4,313

Differences between total amounts of profit (loss) for reportable segments and amounts in theconsolidated statements of income and comprehensive income and main details of these differences(matters relating to difference adjustments)(Millions of yen)AmountProfitReportable segments total

4,313

Elimination of intersegment transactions

306

Operating profit in the consolidated statements ofincome and comprehensive income

3.

Asia

4,619

Disclosure of impairment loss on non-current assets and goodwill, etc. for each reportable segment
Not applicable.

Significant events after reporting period
Not applicable.

-6-