Expansion of Overseas Production Sites

「For the buildings and structures, machinery and vehicles, tools, fixtures and equipment at the Pingtung plant of KASAI TECK SEE CO., LTD., the carrying amounts of assets no longer expected to be used in the future due to the decision to close the plant have been reduced to their recoverable amounts.」

「In Europe, the reorganization of sites and withdrawal from unprofitable businesses have been completed, and we continue to implement measures to improve profitability.」

「All shares of Kasai (Germany) GmbH, which manufactured and sold products for VOLKSWAGEN AG, DAIMLER AG and BMW AG, were sold effective 31 March 2025.」

「During the first-quarter consolidated accounting period, KASAI SLOVAKIA s.r.o., formerly a consolidated subsidiary of the Company, was excluded from the scope of consolidation because its liquidation was completed. During the third-quarter consolidated accounting period, 広東河澤汽車飾件有限公司, formerly an equity-method affiliate, was also excluded from the scope of equity-method accounting because its liquidation was completed.」

「Due to lower production volumes resulting from parts supply issues, as well as lower sales following the closure of factories and dissolution of sites in Europe, revenue fell to ¥18,982 million, a decrease of ¥1,505 million, or 7.3%, from the previous consolidated fiscal year.」

「Due to lower production volumes resulting from parts supply issues, as well as lower sales following the closure of factories and dissolution of sites in Europe, revenue fell to ¥12,950 million, a decrease of ¥4,090 million, or 24.0%, from the same quarter of the previous year,」

「Due to lower production volumes resulting from parts supply issues, as well as lower sales following the closure of factories and dissolution of sites in Europe, revenue fell to ¥8,431 million, a decrease of ¥5,690 million, or 40.3%, from the same quarter of the previous year,」

「KASAI SLOVAKIA s.r.o. in Slovakia was dissolved effective 30 November 2021. However, because liquidation had not been completed as of the end of the consolidated fiscal year, it remained included in the scope of consolidation.」

「The shortage of workers remains an ongoing issue, and the situation continues in which achieving the initial business plan has become difficult due to raw-material costs rising beyond assumptions and other factors. …Because there is no prospect of a recovery in performance over the medium to long term, we decided to withdraw from the business in that country.」

「(Europe) Despite the impact of COVID-19, revenue increased to ¥14,191 million, up ¥2,044 million, or 16.8%, from the same quarter of the previous year, due to the establishment of a new site in Germany (established in April 2019) and the launch of new vehicles in Slovakia. However, due to higher launch preparation costs and other factors, the segment loss was ¥5,269 million, a decrease in profit of ¥3,821 million from the same quarter of the previous year.」

「(Europe) Despite the impact of COVID-19, revenue increased to ¥5,234 million, up ¥1,959 million, or 59.8%, from the same quarter of the previous year, due to the establishment of a new site in Germany (established in April 2019) and the launch of new vehicles in Slovakia.」

「In addition, during the third-quarter consolidated accounting period, we newly established 広東河澤汽車飾件有限公司 through a joint venture with 傲成集団有限公司 and included it among the equity-method affiliates.」

「During the second-quarter consolidated accounting period, we newly established 武漢河達汽車飾件有限公司 and included it in the scope of consolidation.」

「During the first-quarter consolidated accounting period, we newly established Kasai (Germany) GmbH and included it in the scope of consolidation. We also newly established KASAIKOGYO MOROCCO SARL AU, but because its impact on consolidated results is minor and lacks materiality, it is treated as a non-consolidated subsidiary.」

「However, operating profit fell to ¥7,192 million, down ¥4,254 million, or 37.2%, from the same quarter of the previous year, due to higher preparation costs for new-vehicle launches and the impact of costs associated with establishing a new site.」

「In the European market, automobile sales increased year on year, partly due to brought-forward demand related to the introduction of a new fuel-economy testing method. With mold sales also increasing, revenue rose to ¥8,347 million, an increase of ¥684 million, or 8.9%, from the same quarter of the previous year. However, due to higher costs associated with launching a new site, segment profit fell to ¥284 million, down ¥384 million, or 57.5%, year on year.」

「Driven by the launch of new vehicles and mold sales, revenue increased to ¥4,531 million, up ¥520 million, or 13.0%, from the same quarter of the previous year. However, due to foreign exchange effects and higher costs at sites preparing for production, segment profit fell to ¥282 million, down ¥286 million, or 50.4%, year on year.」

「During the second-quarter consolidated accounting period, we newly established KASAI SLOVAKIA s.r.o. and included it in the scope of consolidation. The company qualifies as a specified subsidiary of the Company.」

「During the second quarter of the consolidated fiscal year, the Company newly established KASAI SLOVAKIA s.r.o. and included it in the scope of consolidation.」

「Against this backdrop, the Group is actively expanding its business, including overseas, by ensuring quality, promoting productivity improvements and cost-reduction activities, and strengthening product development capabilities and technological expertise in order to establish its position as a global automotive interior components manufacturer. During the consolidated fiscal year, it newly established 東風河西（武漢）頂飾系統有限公司 in Wuhan, Hubei Province, China, to serve customers in China and further expand its business.」

「The Group has actively expanded overseas to date and plans to establish additional overseas production bases in line with further customer diversification and other developments.」