Soaring prices of steel and other raw materials

「At the same time, the recovery remained lacking in strength, as the effects of rising prices and interest rates continued to be felt.」

「We are focusing on productivity improvement initiatives and working to reduce costs, while also diversifying our sources of procurement. We are also negotiating with both suppliers and customers to achieve purchase and sales prices that reflect market conditions.」

「Chain orders received amounted to ¥45,214 million, up 3.1% year on year, and net sales amounted to ¥46,343 million, up 0.9%. However, operating profit was ¥7,247 million, down 8.5%, due to higher costs. Motion Control net sales amounted to ¥11,126 million, up 2.2%, but operating profit was ¥145 million, down 37.7%, due to higher component procurement costs resulting from the weaker yen and other factors.」

「Japan's economic recovery was slow owing to weaker external demand resulting from stagnation in overseas economies, sluggish personal consumption caused by inflation, and slowing domestic demand resulting from weak capital investment.」

「Although exports remained strong as the yen weakened, Japan's economic recovery was slow owing to weaker external demand resulting from stagnation in overseas economies and sluggish personal consumption caused by higher energy prices and inflation.」

「Japan's economy gradually normalized its economic and social activity as COVID-19 was reclassified under the Infectious Diseases Control Law, and inbound demand also recovered. However, the recovery remained moderate due to soaring raw-material and energy prices, rising prices, and other factors.」

「Mobility sales increased year on year due to higher sales of timing chain systems for automotive engines and other products at bases in the Americas, Europe, the Indian Ocean Rim, China and South Korea. However, operating profit was ¥6,376 million, down 2.9%, due to soaring raw-material and energy prices and other factors.」

「As a result, Mobility orders totaled ¥57,290 million, up 19.3% year on year, and net sales totaled ¥56,832 million, up 18.7%. However, operating profit was ¥4,531 million, down 10.1%, due mainly to higher energy and raw material prices.」

「Although sales of timing chain systems for automotive engines and other products declined in Japan, sales increased at bases in the Americas, Europe and South Korea, resulting in higher sales year on year. Accordingly, Mobility orders received amounted to ¥36,823 million, up 13.2% year on year, and net sales amounted to ¥36,428 million, up 12.4%. However, operating profit was ¥2,375 million, down 34.9%, due to soaring energy and raw-material prices and other factors.」

「In mobility, sales of timing chain systems for automobile engines and other products declined at bases in Japan, Europe, and other regions, but sales of these products increased at bases in Thailand and South Korea. Together with the positive effect of yen depreciation on foreign exchange, this resulted in higher revenue year on year. As a result, orders received in mobility amounted to ¥18,355 million, up 7.3% year on year, and net sales amounted to ¥18,105 million, up 5.9%. However, operating income fell 30.3% to ¥1,506 million due to soaring energy and material prices, among other factors.」

「③ Risk of soaring energy and material (raw-material) prices: A sharp increase in the prices of energy required for the Group's business activities or materials such as steel used in production could increase costs, erode profitability, and affect the Group's operating results and financial position.」

「Although Japan’s economy was on a recovery trend due to various policies and improvements in overseas economies, uncertainty about the outlook continued because of restrictions on economic activity associated with the renewed spread of COVID-19, particularly its variants, semiconductor shortages, and soaring material prices.」

「Although Japan’s economy was on a recovery trend due to various policies and improvements in overseas economies, uncertainty about the outlook continued due to restrictions on economic activity associated with the renewed spread of COVID-19, semiconductor shortages, soaring material prices, and other factors.」

「If the prices of key raw materials such as steel used in production rise sharply, the resulting increase in the Group's procurement costs could erode profitability and affect its operating results and financial position. Measures: The Group is focusing on productivity improvement initiatives and working to reduce costs, while also pursuing measures such as diversifying its suppliers.」

「Although the Group is focusing on productivity improvement initiatives and working to reduce costs, a sharp rise in the prices of key raw materials such as steel could raise procurement costs, erode profitability, and materially affect the Group's operating results and financial position.」

「Although our Group is focusing on productivity improvement initiatives and working to reduce costs, a sharp rise in the prices of raw materials such as steel could raise our procurement costs, deteriorate profitability, and affect our business results.」

「Operating profit was ¥20,694 million, down 4.4%, and ordinary profit was ¥21,743 million, down 1.2%, due to higher depreciation and amortization and factory start-up costs associated with increased capital investment, higher steel prices, and other factors.」

「Orders received for automotive parts amounted to ¥58,479 million, up 6.3% year on year, and net sales amounted to ¥58,511 million, up 6.6%. However, operating profit was ¥8,031 million, down 12.6%, due to increased depreciation and amortization, higher steel prices, and other factors.」

「Although sales of timing drive systems for automotive engines in Japan were flat, sales of the same products were strong at bases in Europe, Thailand, China and South Korea, resulting in higher sales year on year. Accordingly, orders received for automotive parts amounted to ¥38,551 million, up 6.1% year on year, and net sales amounted to ¥38,535 million, up 5.7%. However, operating profit was ¥5,161 million, down 11.3%, due to increased depreciation and amortization, higher steel prices, and other factors.」

「Orders received for automotive parts amounted to ¥19,739 million, up 8.3% year on year, and net sales amounted to ¥19,719 million, up 7.0%. However, operating profit was ¥2,680 million, down 10.9%, due to higher steel prices and increased depreciation and amortization.」

「A sharp rise in the prices of raw materials such as steel could raise our Group’s procurement costs, deteriorate profitability, and affect our business results.」