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, 2017
<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, 2017, maintained a general trend ofrecovery. In the United States, with steady spending and continued gradual expansion of consumer
spending backed by a favorable employment situation, it was decided to raise the policy interest rate tonormalize the financial environment. In China, while economic growth became slow, the economic
activity remained solid, driven mainly by infrastructure investment. The economies of other emerging
countries also remained generally firm. The Japanese economy has continued a moderate recovery
supported by a recovery in exports and production, encouraged by the firm global economy.
In the automotive industry, while new automobile sales began to level off in the United States, a stable
increase continued in China, and sales remained strong in Japan and other countries in Asia.
Under these circumstances, the Group has set the basic policies of “Back to Basics” and “Challenge forNew” outlined in the 13th Mid-term plan, which started in April 2017, and has been working to provide
its customers with new value.
The operating results for the Group during the nine months under review are as follows. The Groupbenefited from an increase in production by major customers in the Japanese market and favorable sales
by major customers and other customers in the Chinese market. Net sales rose by 15.7% year on year to
163,802 million yen, operating profit decreased by 9.6% year on year to 5,321 million yen, ordinary
profit decreased by 9.1% year on year to 4,537 million yen and profit attributable to owners of parentrose by 46.1% year on year to 3,500 million yen.
Operating results by segment are as follows.
(Japan)Favorable sales due to an increase in production volumes of the major customers of the Company led to
net sales rising by 12.5% year on year to 21,040 million yen. The segment recorded an operating profit of
1,538 million yen, up by 77.5% year on year.
(North America)
Although, by the impact from a temporary lull of automobile sales in the United States, production
volumes of the major customers in North America moderated, net sales rose by 11.6% year on year to95,772 million yen due to the start-up of products for newly awarded contracts from customers, theincrease in tooling sales, and the impact of yen depreciation in the exchange market compared with thesame period of previous year. The segment recorded an operating loss of 319 million yen (an operatingprofit of 2,272 million yen was recorded in the same period of the previous year) due to the end ofproduction of high-value-added products, an increase in cost associated with the start-up of products thatwere newly awarded, and production efficiency decreased by a tight labor market.
(Asia)
Due to favorable sales mainly to major customers in China, net sales rose by 26.9% year on year to46,989 million yen and operating profit rose by 58.0% year on year to 3,984 million yen.
(2) Information regarding financial position
As of December 31, 2017, total assets increased by 9,276 million yen compared with the end of theprevious fiscal year to 153,697 million yen, mainly reflecting increases in notes and accounts receivable trade, work in process, raw materials and supplies, and machinery, equipment and vehicles.
Liabilities increased by 2,685 million yen from the end of the previous fiscal year to 97,374 million yen
mainly reflecting increases in short-term loans payable, current portion of long-term loans payable, andlong-term loans payable.
Net assets increased by 6,590 million yen from the end of the previous fiscal year to 56,323 million yen
mainly reflecting increases in capital stock, capital surplus, and retained earnings.

-1-(3) Information regarding revisions to consolidated earnings forecasts
Taking recent performance trends into consideration, the Company has revised its consolidated earnings
forecasts, which were announced on November 7, 2017, as described below.
Revisions to consolidated earnings forecasts for the fiscal year ending March 31, 2018 (From April 1,2017 to March 31, 2018)(Millions of yen)
ProfitBasic
Operating
Ordinary
attributable
Net salesearnings per
profitprofitto owners ofshare (Yen)parentPrevious forecasts (A)220,000
8,200
7,100
4,400
245.70Current forecasts (B)226,000
7,000
6,000
4,200
237.88Difference (B-A)
6,000(1,200)(1,100)(200)
Difference (%)
2.7(14.6)(15.5)(4.5)(Reference) Actual results forthe previous fiscal year
197,941
8,035
7,214
4,035
261.01(Fiscal year ended March 31,2017)
Reasons for the revisions
In regard to the consolidated earnings forecasts for the fiscal year ending March 31, 2018, althoughproduction was strong at major customers in Asia, including Japan and China, a decrease in profit isforecast due to events in North America including new customers’ new model production plans being
pushed back, the impact of customers being affected by strikes, and an increase in costs to improvelogistics and production efficiency for the future.
Average exchange rates for the fiscal year are assumed at 111.24 yen to the U.S. dollar.
Note: The above-stated earnings forecasts are based on information currently available to the Company
and are considered to be rational on this basis. However, as they include risks and uncertainties
which are subject to various future events, actual results may differ from forecasts.

-2-2. Quarterly consolidated financial statements and significant notes thereto(1) Consolidated balance sheets(Millions of yen)
As of March 31, 2017

As of December 31, 2017

5,719
33,151
5,883
4,228
8,533
4,383
61,8996,470
35,856
6,045
5,382
10,176
5,428
69,361

18,93733,374
11,416
10,94874,676508

18,757
40,6296,164
10,89776,449
386

5,677
1,676
(17)
7,336
82,521
144,420

5,966
1,548
(13)
7,500
84,336
153,697

21,186
20,562
10,953
649
134
9,979
63,46519,99323,823
12,739
547
103
9,230
66,4362,350
23,271
280
987
67
4,265
31,222
94,688–26,507
95
969
63
3,302
30,937
97,374

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 assets
Total 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
Bonds payable
Long-term loans payable
Provision for directors’ retirement benefits
Net defined benefit liability
Negative goodwill
Other
Total non-current liabilities
Total liabilities-3-(Millions of yen)
As of March 31, 2017
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-4-

As of December 31, 2017

5,615
6,155
21,425(18)
33,1776,790
7,330
24,446(18)
38,548

740

881

270
(533)
477
16,07749,732
144,420

974
(446)
1,409
16,36556,323
153,697

(2) Consolidated statements of income and comprehensive income(Millions of yen)
Nine months ended
December 31, 2016Net 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
methodOther
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
Gain on sales of investment securities
Total extraordinary income
Extraordinary losses
Loss on sales of non-current assets
Loss on retirement of non-current assets
Impairment loss
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-5-

Nine months ended
December 31, 2017

141,530
123,849
17,681
11,792
5,888

163,802145,742
18,06012,739
5,321

41
42

63
35

371

214

120
576

153
466

640
808
27
1,476
4,988

821
307
121
1,250
4,537

29
2
32

39–
39

1
32
152
186
4,835
1,211
280
1,492
3,342

0
56
–
57
4,519
1,173
(814)
358
4,160

2,396
946

3,500
659

112
(3,320)
52

157
1,324
85

(50)

(139)

(3,206)
136

1,427
5,587

186

4,431

(50)

1,156

(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, 2017,
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, 2016
1. Disclosure of net sales and profit for each reportable segment(Millions of yen)
Reportable segments
Japan
Net sales
Net sales to external customers
Transactions with other segments
TotalSegment profit

2.

North America

18,70010,98385,811
1,275

37,0182,113

141,530
14,372

29,68387,087

39,132

155,903

866

2,272

2,5225,661

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

3.

Total

Asia

Reportable segments total
Elimination of intersegment transactions

5,661
227

Operating profit in the consolidated statements ofincome and comprehensive income

5,888Disclosure of impairment loss on non-current assets and goodwill, etc. for each reportable segment(significant impairment loss on non-current assets)(Millions of yen)JapanImpairment loss

North America
5370-6-

Unallocatedamounts andelimination

Asia
28–Total152

II. 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 for reportable segments and amounts in the consolidated
statements of income and comprehensive income and main details of these differences(matters relating to difference adjustments)(Millions of yen)AmountProfit3.

North America

Reportable segments total
Elimination of intersegment transactions

5,203
118

Operating profit in the consolidated statements ofincome and comprehensive income

5,321

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

Significant events after reporting period
Not applicable.

-7-