Expansion of sales in the North and Central American market

「In North and Central America, sales, mainly to the automotive industry, remained firm due to increased orders in the previous consolidated fiscal year. Revenue was ¥303 million higher year on year, up 85.0%, at ¥660 million. In terms of earnings, the gross profit margin declined from 36.1% to 25.6%, mainly due to higher repair costs for defects arising after delivery, while selling, general and administrative expenses also increased. As a result, the operating loss was ¥68 million, compared with an operating loss of ¥80 million in the same period of the previous year, and the segment loss (ordinary loss) was ¥55 million, compared with an ordinary loss of ¥133 million in the same period of the previous year.」

「In North and Central America, orders remained firm, mainly in the automotive sector, as in the previous fiscal year. Revenue also benefited from the increase in orders in the previous fiscal year, rising ¥170 million year on year, or 124.7%, to ¥306 million. In terms of earnings, although the gross profit margin deteriorated from 41.8% to 37.5%, higher revenue and lower selling, general and administrative expenses resulted in operating profit of ¥11 million, compared with an operating loss of ¥52 million in the same period of the previous year. However, due to the recognition of foreign exchange losses and other factors, the segment loss (ordinary loss) was ¥4 million, compared with an ordinary loss of ¥51 million in the same period of the previous year.」

「In North and Central America, orders remained firm, mainly from the automotive industry, and revenue was ¥89 million higher year on year, up 33.4%, at ¥357 million. In terms of earnings, although the gross profit margin improved from 32.5% to 36.1%, higher selling, general and administrative expenses resulted in an operating loss of ¥80 million, compared with an operating loss of ¥121 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥133 million, compared with an ordinary loss of ¥91 million in the same period of the previous year.」

「In North and Central America, capital investment in Central America, mainly in the automotive sector, was gradually recovering. Revenue was ¥76 million higher year on year, up 39.9%, at ¥267 million. In terms of earnings, although the gross profit margin was broadly flat, moving from 32.2% to 32.5%, the operating loss widened to ¥121 million from an operating loss of ¥108 million in the same period of the previous year due to higher selling, general and administrative expenses. The segment loss (ordinary loss) was ¥91 million, unchanged from the ordinary loss of ¥91 million in the same period of the previous year.」

「In North and Central America, capital investment in Central America, mainly in the automotive sector, was gradually recovering. Revenue was ¥128 million higher year on year, up 110.4%, at ¥244 million. In terms of earnings, the gross profit margin deteriorated from 38.4% to 29.9%, while selling, general and administrative expenses increased. As a result, the operating loss was ¥90 million, compared with an operating loss of ¥99 million in the same period of the previous year, and the segment loss (ordinary loss) was ¥46 million, compared with an ordinary loss of ¥58 million in the same period of the previous year.」

「In North and Central America, capital investment in Central America, mainly in the automotive sector, was gradually recovering. Revenue was ¥110 million higher year on year, up 126.1%, at ¥198 million. In terms of earnings, although the gross profit margin was broadly flat, moving from 31.4% to 31.6%, selling, general and administrative expenses increased and other factors resulted in an operating loss of ¥53 million, compared with an operating loss of ¥59 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥9 million, compared with an ordinary loss of ¥29 million in the same period of the previous year.」

「In North and Central America, capital investment in Central America, mainly in the automotive sector, was gradually recovering. Revenue was ¥38 million higher year on year, up 90.1%, at ¥80 million. In terms of earnings, however, the gross profit margin deteriorated from 38.0% to 24.1% due to changes in the product mix and other factors, while selling, general and administrative expenses increased. As a result, the operating loss was ¥34 million, compared with an operating loss of ¥23 million in the same period of the previous year, and the segment loss (ordinary loss) was ¥21 million, compared with an ordinary loss of ¥11 million in the same period of the previous year.」

「In North and Central America, demand in Central America, mainly in the automotive sector, was recovering, but capital investment had yet to recover. Revenue was ¥25 million lower year on year, down 11.7%, at ¥191 million. In terms of earnings, although the gross profit margin improved from 29.1% to 32.2%, the decline in gross profit accompanying the decrease in revenue and other factors resulted in an operating loss of ¥108 million, compared with an operating loss of ¥78 million in the same period of the previous year.」

「In North and Central America, demand in Central America, mainly in the automotive sector, was recovering, but capital investment had yet to recover. Revenue was ¥51 million lower year on year, down 30.6%, at ¥116 million. In terms of earnings, the decline in gross profit accompanying the decrease in revenue and other factors resulted in an operating loss of ¥99 million, compared with an operating loss of ¥52 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥58 million, compared with an ordinary loss of ¥53 million in the same period of the previous year.」

「In North and Central America, although demand, particularly in automotive-related industries, was recovering in Central America, capital investment had not yet recovered. Revenue decreased by ¥7 million, or 7.4%, year on year to ¥87 million. In terms of earnings, the company posted an operating loss of ¥59 million, compared with an operating loss of ¥38 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥29 million, compared with an ordinary loss of ¥35 million, due to the decline in gross profit associated with lower revenue, among other factors.」

「In North and Central America, although demand, particularly in automotive-related industries, was recovering in Central America, capital investment had not yet recovered. Revenue decreased by ¥6 million, or 13.6%, year on year to only ¥42 million. In terms of earnings, the company posted an operating loss of ¥23 million, compared with an operating loss of ¥16 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥11 million, compared with an ordinary loss of ¥15 million, due to the decline in the gross profit margin associated with lower revenue, among other factors.」

「In North and Central America, although manufacturing output, particularly in automotive-related industries, declined in Central America due to semiconductor shortages, revenue increased by ¥119 million, or 123.4%, year on year to ¥216 million. Meanwhile, the company did not achieve profitability due to the deterioration in the gross profit margin, from 33.1% to 29.1%, and higher various expenses, among other factors. It posted an operating loss of ¥78 million, compared with an operating loss of ¥85 million in the same period of the previous year.」

「In North and Central America, the decline in manufacturing output, particularly in automotive-related industries, caused by semiconductor shortages in Central America was normalizing, and revenue increased by ¥103 million, or 161.6%, year on year to ¥167 million. Meanwhile, in terms of earnings, the company did not achieve profitability due to the deterioration in the gross profit margin, from 35.8% to 30.4%, and higher various expenses, among other factors. It posted an operating loss of ¥52 million, compared with an operating loss of ¥62 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥53 million, compared with an ordinary loss of ¥77 million.」

「In North and Central America, although manufacturing output, particularly in automotive-related industries, continued to decline in Mexico due to semiconductor shortages, vaccinations against the novel coronavirus and the easing of restrictions progressed in the United States, among other factors. Revenue increased by ¥56 million, or 149.0%, year on year to ¥94 million. In terms of earnings, gross profit improved, from 28.1% to 30.2%, but the company did not achieve profitability due partly to higher various expenses, posting an operating loss of ¥38 million, compared with an operating loss of ¥43 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥35 million, compared with an ordinary loss of ¥60 million.」

「In North and Central America, although vaccinations against the novel coronavirus and the easing of restrictions progressed in North America, manufacturing output, particularly in automotive-related industries, also declined in Central America due to semiconductor shortages, among other factors. Revenue increased by ¥18 million, or 59.8%, year on year to only ¥49 million. In terms of earnings, gross profit improved, from 30.7% to 34.5%, but the company did not achieve profitability, posting an operating loss of ¥16 million, compared with an operating loss of ¥17 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥15 million, compared with an ordinary loss of ¥35 million.」

「(k) Expanding sales and strengthening the operating framework in the automotive, high-tech and medical industries, primarily in North and Central America」

「In North and Central America, business remained sluggish due to the prolonged US-China trade friction and continued restrictions on economic activity associated with the spread of the novel coronavirus, among other factors. Revenue decreased by ¥125 million, or 66.2%, year on year to only ¥63 million. In terms of earnings, the company posted an operating loss of ¥62 million, compared with an operating loss of ¥42 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥77 million, compared with an ordinary loss of ¥45 million, due to the decline in gross profit associated with lower revenue, among other factors.」

「In North and Central America, business remained sluggish due to the prolonged US-China trade friction and delays in the entry into force of the new NAFTA, among other factors. Revenue decreased by ¥104 million, or 73.4%, year on year to only ¥38 million. In terms of earnings, the company posted an operating loss of ¥43 million, compared with an operating loss of ¥26 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥60 million, compared with an ordinary loss of ¥25 million, due to the decline in gross profit associated with lower revenue, among other factors.」

「In North and Central America, business remained sluggish due to the prolonged US-China trade friction and delays in the entry into force of the new NAFTA, among other factors. Revenue increased by ¥7 million, or 34.2%, year on year to only ¥30 million. In terms of earnings, the company posted an operating loss of ¥17 million, compared with an operating loss of ¥22 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥35 million, compared with an ordinary loss of ¥22 million, due to the decline in gross profit associated with the lower gross profit margin, from 54.3% to 30.7%, among other factors.」

「In North and Central America, revenue decreased by ¥21 million, or 9.0%, year on year to ¥220 million due to the prolonged US-China trade friction and delays in the entry into force of the new NAFTA, among other factors.」

「In North and Central America, revenue decreased by ¥25 million, or 12.0%, year on year to ¥189 million due to the prolonged US-China trade friction and delays in ratifying the new NAFTA, among other factors. In terms of earnings, the company posted an operating loss of ¥42 million, compared with an operating loss of ¥18 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥45 million, compared with an ordinary loss of ¥19 million, due to the decline in gross profit associated with lower revenue and various expenses incurred in launching the business of the US subsidiary, among other factors.」

「In North and Central America, revenue increased by ¥6 million, or 4.4%, year on year to ¥143 million. In terms of earnings, the company posted an operating loss of ¥26 million, compared with operating income of ¥0 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥25 million, compared with ordinary income of ¥0 million, due to the decline in the gross profit margin, from 31.6% to 25.6%, and various expenses incurred in launching the business of the US subsidiary, among other factors.」

「In North and Central America, revenue decreased by ¥12 million, or 35.4%, year on year to ¥22 million due to the impact of trade friction involving the United States, among other factors. Although the gross profit margin improved significantly, the company posted an operating loss of ¥22 million, compared with an operating loss of ¥13 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥22 million, compared with an ordinary loss of ¥12 million.」

「In North and Central America, through the previous consolidated fiscal year, the partnership “Konea Kawata Sales & Service Co.,” an investee of カワタＵ.Ｓ.Ａ.ＩＮＣ., sold products in North America. Following the completion of the partnership’s liquidation on 13 April 2018, the company planned to reorganize カワタＵ.Ｓ.Ａ.ＩＮＣ. as a sales location for North America and begin full-scale sales from fiscal 2019.」

「In North and Central America, automotive-related orders in Mexico remained firm, but revenue decreased by ¥32 million, or 13.0%, year on year to ¥215 million following the dissolution of the partnership in the United States at the end of the previous fiscal year. Although the gross profit margin improved significantly, from 12.9% to 28.5%, the company posted an operating loss of ¥18 million, compared with an operating loss of ¥55 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥19 million, compared with a segment loss of ¥57 million.」

「In North and Central America, automotive-related orders in Mexico remained firm, but revenue decreased by ¥55 million, or 28.7%, year on year to ¥136 million following the dissolution of the partnership in the United States at the end of the previous fiscal year. Although the gross profit margin improved significantly, from 10.1% to 31.6%, operating income was ¥0 million, compared with an operating loss of ¥27 million in the same period of the previous year, and the segment loss (ordinary loss) was ¥0 million, compared with an ordinary loss of ¥28 million.」

「In North and Central America, automotive-related orders remained firm, but revenue decreased by ¥69 million, or 66.1%, year on year to ¥35 million following the dissolution of the partnership in the United States at the end of the previous fiscal year. Although the gross profit margin improved significantly, from 9.2% to 36.3%, the company posted an operating loss of ¥13 million, compared with an operating loss of ¥8 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥12 million, compared with an ordinary loss of ¥8 million.」

「In North and Central America, expenses were incurred ahead of revenue because the newly established Mexican sales company did not become fully operational until the second half of the fiscal year, among other factors. Revenue decreased by ¥155 million, or 36.8%, year on year to ¥266 million. The company posted an operating loss of ¥77 million, compared with an operating loss of ¥5 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥78 million, compared with an ordinary loss of ¥5 million.」

「In North and Central America, expenses were incurred ahead of revenue because the newly established Mexican sales company did not become fully operational until the second half of the fiscal year, among other factors. Revenue decreased by ¥76 million, or 23.5%, year on year to ¥247 million. The company posted an operating loss of ¥55 million, compared with operating income of ¥2 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥57 million, compared with ordinary income of ¥2 million.」

「In North and Central America, demand in the United States remained firm, but because the newly established Mexican sales company was not expected to become fully operational until after the middle of the fiscal year, among other factors, revenue decreased by ¥15 million, or 7.5%, year on year to ¥192 million. The company posted an operating loss of ¥27 million, compared with operating income of ¥3 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥28 million, compared with ordinary income of ¥3 million.」

「In North and Central America, demand in the United States remained firm, but because the newly established Mexican sales company was not expected to become fully operational until after the middle of the fiscal year, among other factors, revenue increased by ¥6 million, or 6.8%, year on year to ¥104 million. The company posted an operating loss of ¥8 million, compared with operating income of ¥0 million in the same period of the previous year, and a segment loss (ordinary loss) of ¥8 million, compared with ordinary income of ¥0 million.」

「In North and Central America, the partnership “Konea Kawata Sales & Service Co.,” an investee of カワタＵ.Ｓ.Ａ.ＩＮＣ., sells products in North America. カワタマシナリーメキシコＳ.Ａ. ＤＥ Ｃ.Ｖ., established in November 2016, was scheduled to begin full-scale sales in Central America from fiscal 2017.」

「In addition, from the first quarter of the current consolidated fiscal year, the company changed the name of its reportable segment from the former “North America” to “North and Central America.” This was a name change only and has no impact on segment information.」

「From the first quarter of the current consolidated fiscal year, the company changed the name of its reportable segment from the former “North America” to “North and Central America.” This was a name change only and has no impact on segment information.」

「From the first quarter of the current consolidated fiscal year, the company changed the name of its reportable segment from the former “North America” to “North and Central America.” This was a name change only and has no impact on segment information.」

「Expansion of sales in the North and Central American market」