Final Results

RNS Number : 9161R

Maruwa Co Ld

08 May 2009

8 May 2009
MARUWA CO., LTD.
3-83, Minamihonjigahara-cho, Owariasahi-city, Aichi-pref., 488-0044 JAPAN

Final Results for Fiscal 2009

MARUWA CO., LTD. today announced its consolidated business results for the full fiscal year ended 31st March, 2009 as follows;
*The financial statements are prepared in conformity with the accounting principles generally accepted in Japan.
*US dollar amounts are converted for convenience only at the rate of US$1 = 98.23yen.
*Consolidated subsidiaries:12 companies (Maruwa (Malaysia) Sdn. Bhd., Taiwan Maruwa Co., Ltd., MARUWA Electronics (Taiwan) Co., Ltd., Maruwa Europe Ltd., Maruwa America Corp., Maruwa Korea Co., Ltd., Maruwa (Shanghai) Trading Co., Ltd., Maruwa Electronics (Philippines), Inc., MARUWA Electronic (India) Pvt.Ltd., MARUWA QUARTZ Co., Ltd., MARUWA SHOMEI Co., Ltd., and Hokko Denshi Co., Ltd.)

I. Summary of Consolidated Results
(1) Summary of consolidated statement of income
		JPY million						USD thousand
	For year ended	For year ended				Change %		For year ended
	31st March	31st March						31st March
	2008	2009						2009
Net sales	20,635	16,693				-19.1%		169,938
Operating income	1,576	(511)				--		(5,202)
Income before income taxes	1,584	(474)				--		(4,825)
Net income	1,100	(770)				--		(7,839)
		JPY						USD
Net income per share (Basic)	101.80	(71.68)				--		(0.73)
(Diluted)	101.68	--				--		--

*Average number of issued shares	10,809,627	10,736,613

(2) Summary of consolidated financial condition
				JPY million				USD thousand
	As of 31st March			As of 31st March			Change %	As of 31st March
	2008			2009				2009
Total Assets	32,850			28,749			-12.5%	292,670
Total net assets	27,774			25,284			-9.0%	257,396
Equity ratio	84.5%			87.9%			3.4%
				JPY				USD
Total net assets per share	2,571.59			2,358.54			-8.3%	24.01
*Number of issued shares at the year end	10,800,410			10,720,180

(3) Summary of consolidated statement of cash flows
					JPY million			USD thousand
	For year ended		For year ended				Change %	For year ended
	31st March		31st March					31st March
	2008		2009					2009
Net cash provided by operating activities	2,590		3,854				48.8%	39,234
Net cash used in investing activities	(1,921)		(2,249)				-17.1%	(22,895)
Net cash used in financing activities	(416)		(387)				7.0%	(3,940)
Cash and cash equivalents at end of term	6,146		7,062				14.9%	71,892

II. Dividends			III. Outlook for fiscal 2010 ending 31 March 2010
	JPY per share				JPY million
	Fiscal 2009	Fiscal 2010		Half year	Full year
		(forecast)	Net sales	5,400	12,400
Interim	14	14	Operating income	50	460
Year-end	14	14	Net income	30	270
Annual	28	28	Net income per share	2.80	25.19

*Cautionary statements: the above forecasts are forward-looking statements involving risks and uncertainties. Due to a number of factors, actual results may differ significantly from these estimates.

Review of Operations and Financial Condition

1. Operating Results

	JPY million
	Fiscal 2008				Fiscal 2009
	1Q	2Q	3Q	4Q	1Q	2Q	3Q	4Q
Net sales	4,719	5,118	5,265	5,533	4,764	5,078	3,651	3,200
Operating income	359	417	451	349	195	338	84	(1,128)
Net income	272	295	329	204	132	238	106	(1,246)

	JPY million
	Previous	Current
	For year ended	For year ended
	31st March 2008	31st March 2009
Net sales	20,635	16,693
Operating income	1,576	(511)
Net income	1,100	(770)

(1) Review of operations

Japanese economy in this year started to slow down more sharply than ever due to weak consumer spending, including a drastic decrease in car sales, and a cut in capital investment along with decreasing corporate revenues, influenced by the U.S. economy downturn started from the sub-prime loan issue and the appreciation of the yen.

Looking at the global economy, real economy plunged into its worst recession of the century amid the turmoil in the financial markets with a decline in the U.S. and Europe's automobile markets and the shrinkage of the housing markets, and a continuous and significant decrease of exports in China, which had enjoyed high economic growth.

Our electronic components sector had rather solid demands in the first half of this year except for the semiconductor equipment market; however, it has been influenced by the recession both globally and regionally since the beginning of the third quarter.

Under these circumstances, we recorded consolidated net sales 16,693 million yen, down 19.1% compared to last year, almost as announced on 5 February 2009 as we have focused on commencing mass-production of a series of new products which had been invested up-front, in addition to actively promoting our existing products.

Against these rapid changes in markets, we have promptly taken appropriate countermeasures since early in this year, including our group-wide effort to cut capital investment and various expenses. In a still uncertain economy, we strengthened our financial condition so that we can swiftly respond to severe changes in the markets; we strictly evaluated inventories including dead stocks, and also revaluated all of our assets.

As a result, we posted operating loss of 511 million yen.

Net loss was 770 million yen since we posted extraordinary losses of expenses for voluntary retirement scheme and for transfer or consolidation of plants or sales offices of our group to improve profitability in the future. At the same time, we revaluated and decreased deferred income tax assets because of a downturn in business.

(2) Review of operating results by business segment

	JPY million
			Current
	For year ended		For year ended
	31st March 2008		31st March 2009
Ceramic Components:
Net sales		18,479		14,916
Operating income		2,092		(163)

Lighting Equipment:
Net sales		2,156		1,777
Operating income		(6)		22

Total:
Net sales		20,635	16,693
Operating income		2,086	(141)

Elimination:
Net sales		-	--
Operating income		(510)	(370)

Consolidated:
Net sales		20,635	16,693
Operating income		1,576	(511)

Quarterly sales results of Ceramic Components segment by product division

	JPY million
	Fiscal 2008				Fiscal 2009
	1Q	2Q	3Q	4Q	1Q	2Q	3Q	4Q
Circuit Ceramics	1,692	1,868	1,936	1,673	1,869	1,906	1,238	813
Machinery Ceramics	1,325	1,330	1,258	1,186	1,164	1,116	865	473
RF* Products	474	492	500	456	487	529	506	355
EMC Components	1,041	1,064	1,138	1,046	1,087	1,254	709	545
Total	4,532	4,754	4,832	4,361	4,607	4,805	3,318	2,186
*Radio Frequency

				JPY million
	Previous		Current
	For year ended		For year ended
	31st March 2008		31st March 2009
Circuit Ceramics		7,169		5,826
Machinery Ceramics		5,099		3,618
RF Products		1,922		1,877
EMC Components		4,289		3,595
Total	18,479		14,916

Ceramic Components segment

Total sales of the Ceramic Component segment were 14,916 million yen from last year, down 19.3%, and operating loss was 163 million yen. New products contributed to total sales, but a drastic reduction in inventories including dead stocks to strengthen our productions put pressure on our profits.

Circuit Ceramics

The Circuit Ceramics division includes ceramic substrates for chip resistors which are essential for a wide range of electronic appliances, glazed substrates for thermal printer head (TPH) used for FAX or bar code label printers, large ceramic substrates for hybrid ICs, and Aluminum Nitride (AlN) substrates used for power modules and automotive components.

Total sales of this division were 5,826 million yen, down 18.7% compared to last year. While new mass-produced ceramic substrates for automotive parts, special large ceramic substrates and glazed substrates contributed to an increase in order, sales of Alumina substrates for chip resistors significantly decreased particularly in the markets of China and East Asia.

Machinery Ceramics

The Machinery Ceramics division includes quarts glass products especially for semiconductor equipment, ceramic faucet valves, and ferrite magnet materials used for measuring equipment or medical purposes. Products in this division require high precision processing techniques.

Total sales of this division were 3,618 million yen, down 29.0% from the previous year. Particularly, sales in quartz glass products greatly declined especially from the third quarter as the semiconductor equipment market slowed down beyond the estimated level.

Radio Frequency Products

The Radio Frequency Products division includes device products such as band pass filters used for wireless communication industries, dielectric ceramic filters required in mobile communication industries, thin film substrates used for optical information/communication industries, and multi-layer ceramic substrates for automotive components.

Total sales of this division in this year were 1,877 million yen, down 2.3% compared to last year. Thin -film products sales increased and new mass-production of multi-layer ceramic substrate for automobiles contributed to total sales; however, sales of the other existing products decreased.

EMC Components

The EMC Components division includes multi-layer ceramic capacitors of high-voltage/high-capacitance especially used for digital cameras, LCD backlights, or power supply parts of electronic devices, and a product line as a countermeasure against noise/surge, including EMI filters, chip varistors, chip beads and inductors. There are increasing demands for such components for various electronic appliances such as communication tools, including mobile phones and PCs, digital home appliances, amusement equipment or automotive electronic devices.

Total sales of this division in this year were 3,595 million yen, down 16.2% compared to the previous year. Even though new products started mass-production and sales of some products increased, the other existing products greatly declined from the third quarter.

Lighting Equipment segment

This segment includes lighting equipment for public works such as roads and bridges, and most of sales are particularly posted in the end of a fiscal year while expenses exceed sales until then.

Total sales of this segment in this year were 1,777 million yen, down 17.6% from last year, and operating income was 22 million yen. The enhancement of new LED lighting products and marketing activities contributed to sales and brought this segment out of the red even though the market of conventional lighting fixtures is continuously in a deceasing trend.

(3) Outlook for the full fiscal 2010

				JPY million
		For year ended		For year ending	Change
		31st March 2009		31st March 2010	%
Net sales	16,693		12,400		-25.7%
Operating income	(511)		460		--
Net income	(770)		270		--

Sales by business segment

		JPY million
	For year ended	For year ending	Change
	31st March 2009	31st March 2010	%
Ceramic Components	14,916	10,700		-28.3%
Lighting Equipment	1,777	1,700		-4.3%
Total	16,693	12,400		-25.7%

Outlook for future economy is extremely uncertain due to shrinkage in financial markets, unstable currency movements, and also a concern about stagnant employment. It is highly possible for the global economy, including Japan, to stay in a recession in a long-term while the effect of an emergency economic package of each country is expected.

In our electronic components sector, we expect a continuously difficult market situation due to the above-stated economic environment, even though we will see temporary recovery in sales probably on the rebound of once-reduced inventories for adjustments.

Under these circumstances, we will promote high value-added products, such as ceramic substrates for power modules for hybrid cars and wind power generators, and multi-layer ceramic substrates for automotive electronics and medical devices, which require elemental ceramic technologies. For the lighting equipment segment, we will expand our business by developing LED module products utilizing ceramics' characteristics, and by promoting LED lighting line-ups.

We are planning to invest substantially in R&D activities, focusing on the development of high value-added products based on the elemental ceramic technologies and other new technologies while we will restrict capital expenditures to the minimum requirement, particularly for product improvement or new products.

Moreover, we will make an effort to improve our revenues through further reduction of expenses and active business expansion, taking advantages of our ongoing activities to enhance a business structure and profitability.

Accordingly, we forecast that net sales for next fiscal year will be 12,400 million yen, down 25.7% from this year, operating income 460 million yen, and net income 510 million yen.

*Cautionary statements: the above forecasts are based on the present business environment and currently-available information, and include forward-looking statements involving risks and uncertainties. The reader is cautioned not to place reliance entirely on the above forecasts for making investment decisions. Due to a number of factors such as future economic situations and market environment changes, actual results may differ significantly from these estimates.

2. Financial Condition

	JPY million				JPY million
	As of 31st March		As of 31st March		Change
	2008		2009		Amount	%
Total assets		32,850		28,749	-4,101	-12.5%
Total liabilities		5,076		3,465	-1,611	-31.7%
Total net assets		27,774		25,284	-2,490	-9.0%
Equity ratio		84.5%		87.9%	3.4%

	JPY million				JPY million
	For year ended		For year ended		Change
	31st March 2008		31st March 2009		Amount	%
Net cash provided by operating activities		2,590		3,854	1,264	48.8%
Net cash used in investing activities		(1,921)		(2,249)	328	17.1%
Net cash used in financing activities		(416)		(387)	-29	-7.0%
Cash and cash equivalents at end of year		6,146		7,062	916	14.9%

Net sales		20,635		16,693	-3,942	-19.1%
Capital expenditure		3,097		1,482	-1,615	-52.1%
Depreciation		1,910		1,982	72	3.8%

Total assets at the end of this year were 28,749 million yen, a decrease of 4,101 million yen from the last year-end as a result of operating activities in this year. It is due to a decrease of current assets by 2,406 million yen, including trade notes and accounts receivable.

Liabilities were 3,465 million yen, down 1,611 million yen compared to the last year-end due particularly to a decrease of trade notes and accounts payable.

Total net assets decreased 2,490 million yen due to a decrease in foreign currency translation adjustment.

As a result, equity ratio was 87.9 %, up 3.4 points from the last year-end.

Net cash provided from operating activities was 3,854 million yen, an increase of 1,264 million yen compared to last year especially because of a decrease of trade notes and accounts receivable and inventories.

Net cash used in investing activities increased 328 million yen to 2,249 million yen from last year.

Net cash used in financing activities was 387 million yen, down 29 million yen compared to last year, mainly used for purchase of own shares, 102 million yen, and dividends payment, 280 million yen

As a result of above cash flows, cash and cash equivalents at the end of this year were 7,062 million yen, an increase of 916 million yen from last year since cash flows in operating activities were greater than the sum of cash flows in investing activities and financing activities.

Trends of cash-flows indices

						JPY million
	For year ended		For year ended		For year ended
	31st March 2007		31st March 2008		31st March 2009
Equity ratio		82.4%		84.5%		87.9%
Equity ratio at market value		76.2%		39.8%		36.4%
Interest-bearing debt to cash flows ratio (year)		0.1		0.1		0.0
Interest coverage ratio		374.2		497.2		1,809.3

Note)

Equity ratio : (Total net assets - Minority interests) / Total assets

Equity ratio at market value : Total market value of shares / Total assets

Interest-bearing debt to cash flows ratio : Interest-bearing debts / Cash flows from operating activities

Interest coverage ratio : Cash flows from operating activities / Interest payment

*Each index is calculated with the consolidated financial figures.

*Total market value of shares is calculated by multiplying the share value as of the end of the fiscal year by the total number of issued shares after deduction of own shares at the end of the year.

*For cash flows from operating activities, figures in the consolidated cash flows statements are used. Interest-bearing debt includes all debts for which interests are paid among the liabilities booked in the consolidated balance sheets.

3. Dividend policy and dividend of this year and next year

MARUWA considers allocating acquired cash flows from business operations for active investment into new growing fields, dividends calculated through comprehensive analysis of consolidated business results, and saving for internal reserves to control flexibly changes in a business environment. While we secure internal reserves for strategic investment necessary for sustainable expansion of our core business, we focus on profit returns to our shareholders.

Dividend for next year will be 28 yen per share (interim: 14 yen, year-end: 14yen) as much as dividends for this year, 28 yen per share.

Consolidated Balance Sheets

	JPY million	JPY million	USD thousand
	As of 31st March	As of 31st March	As of 31st March
	2008	2009	2009
ASSETS
Current assets:
Cash & deposits	6,263	7,505	76,402
Trade notes and accounts receivable	6,649	4,304	43,816
Inventories	4,137	3,069	31,243
Deferred tax assets	236	157	1,598
Other current assets	414	264	2,687
Allowance for doubtful accounts	(2)	(8)	(81)
Total current assets	17,697	15,291	155,665

Property, plant & equipment:
Land	3,215	3,160	32,169
Buildings & structures	4,231	3,796	38,644
Machinery & equipment	4,473	3,950	40,212
Other	641	360	3,665
Construction in progress	423	443	4,510
Net property, plant & equipment	12,983	11,709	119,200

Investments & other assets:
Investment securities	445	455	4,632
Deferred tax assets	103	16	163
Property & equipment for investments	945	931	9,478
Other	684	382	3,888
Allowance for doubtful accounts	(7)	(35)	(356)
Total investments & other assets	2,170	1,749	17,805

Total assets	32,850	28,749	292,670

	JPY million	JPY million	USD thousand
	As of 31st March	As of 31st March	As of 31st March
	2008	2009	2009
LIABILITIES
Current liabilities:
Trade notes & accounts payable	1,708	1,352	13,764
Current portion of long-term debt	5	5	51
Accrued income taxes	110	30	305
Accrued bonus	357	241	2,453
Accrued bonus for directors	--	4	41
Notes payable for property acquisitions	898	390	3,970
Other current liabilities	1,190	789	8,032
Total current liabilities	4,268	2,811	28,616

Long-term liabilities:
Long-term debt	130	125	1,273
Deferred tax liabilities	248	191	1,944
Negative goodwill	112	58	590
Other	318	280	2,851
Total long-term liabilities	808	654	6,658

Total liabilities	5,076	3,465	35,274

NET ASSETS
Shareholders' equity:
Common stock	6,710	6,710	68,309
Capital surplus	9,747	9,747	99,226
Retained earnings	12,324	11,252	114,548
Treasury stock, at cost	(639)	(742)	(7,554)
Total shareholders' equity	28,142	26,967	274,529

Valuation and translation adjustments:
Net unrealized gains (losses)	(72)	(201)	(2,046)
on available-for-sale securities
Foreign currency translation adjustment	(296)	(1,482)	(15,087)
Total valuation and translation adjustments	(368)	(1,683)	(17,133)

Total net assets	27,774	25,284	257,396
Total liabilities & net assets	32,850	28,749	292,670

Consolidated Statements of Income

	JPY million	JPY million	USD thousand
	For year ended	For year ended	For year ended
	31st March	31st March	31st March
	2008	2009	2009
Net sales	20,635	16,693	169,938
Cost of sales	15,214	13,952	142,034
Gross profit	5,421	2,741	27,904
Selling, general & administrative expenses	3,845	3,252	33,106
Operating income	1,576	(511)	(5,202)
Other income (expenses):
Interest and dividend income	83	69	702
Interest expenses	(5)	(2)	(20)
Amortization of negative goodwill	202	80	814
Foreign exchange gain (loss), net	(88)	164	1,670
Gain on sales of property, plant and equipment	55	59	601
Loss on disposal or sales of property, plant and equipment	(237)	(68)	(692)
Loss on sales or valuation of investment securities	--	(31)	(316)
Loss on valuation of inventories	--	(28)	(285)
Loss on liquidation of subsidiary	(96)	--
Early extra retirement payments	--	(208)	(2,117)
Other, net	94	2	20
Other income (expenses), net	8	37	377
Income before income taxes	1,584	(474)	(4,825)
Income tax expenses:
Current	311	69	702
Deferred	173	227	2,312
Total income taxes	484	296	3,014

Net income	1,100	(770)	(7,839)

Consolidated Statements of Changes in Net Assets

	JPY million
	Shareholders' equity					Valuation and translation adjustment
	Common stock	Capital surplus	Retained earnings	Treasury stock	Total shareholders' equity	Net unrealized gains on available-for- sale securities	Foreign currency translation adjustment	Total valuation and translation adjustment	Total net assets

Balance at 31 March 2008	6,710	9,747	12,324	(639)	28,142	(72)	(296)	(368)	27,774
Effect of changes in accounting policies applied to foreign subsidiaries			147		147				147
Cash dividends			(280)		(280)				(280)
Net income			(770)		(770)				(770)
Change of scope of consolidation			(169)		(169)				(169)
Purchase of treasury stock			--	(103)	(103)				(103)
Disposal of treasury stock			--	--	--				--
Other changes						(129)	(1,186)	(1,315)	(1,315)
Total changes during the year			(1,072)	(103)	(1,175)	(129)	(1,186)	(1,315)	(2,490)
Balance at 31 March 2009	6,710	9,747	11,252	(742)	26,967	(201)	(1,482)	(1,683)	25,284

									USD thousand
	Shareholders' equity					Valuation and translation adjustment
	Common stock	Capital surplus	Retained earnings	Treasury stock	Total shareholders' equity	Net unrealized gains on available-for- sale securities	Foreign currency translation adjustment	Total valuation and translation adjustment		Total net assets

Balance at 31 March 2008	68,309	99,226	125,461	(6,505)	286,491	(733)	(3,013)	(3,746)		282,745
Effect of changes in accounting policies applied to foreign subsidiaries			1,497		1,497					1,497
Cash dividends			(2,851)		(2,851)					(2,851)
Net income			(7,839)		(7,869)					(7,839)
Change of scope of consolidation			(1,720)		(1,720)					(1,720)
Purchase of treasury stock			--	(1,049)	(1,049)					(1,049)
Disposal of treasury stock			--	--	--					--
Other changes						(1,313)	(12,074)	(13,387)		(13,387)
Total changes during the year			(10,913)	(1,049)	(11,962)	(1,313)	(12,074)	(13,387)		(25,349)
Balance at 31 March 2009	68,309	99,226	114,548	(7,554)	274,529	(2,046)	(15,087)	(17,133)		257,396

Consolidated Statements of Cash Flows

	JPY million	JPY million	USD thousand
	For year ended	For year ended	For year ended
	31st March	31st March	31st March
	2008	2009	2009
Cash flows from operating activities:
Income before income taxes	1,584	(474)	(4,825)
Adjustments for:
Depreciation	1,910	1,982	20,177
Amortization of negative goodwill	(202)	(80)	(814)
Impairment loss	--	79	804
Decrease in allowance for doubtful accounts	(11)	34	346
Loss on disposal of property, plant & equipment	192	8	81
Interest & dividend income	(83)	(69)	(702)
Foreign exchange (gain) loss	0	74	753
Gain on sales of investment securities	(4)	10	102
Decrease (increase) in trade notes & accounts receivable	1,111	2,151	21,898
Increase in inventories	(643)	938	9,549
Decrease in trade notes & accounts payable	(616)	(297)	(3,024)
Other	(230)	(460)	(4,684)
Sub-total	3,008	3,896	39,661
Interest & dividend income received	80	68	692
Interest expenses paid	(5)	(2)	(20)
Income taxes paid	(493)	(108)	(1,099)
Net cash provided by operating activities	2,590	3,854	39,234

Cash flows from investment activities:
Payments into time deposits	(101)	(395)	(4,021)
Proceeds from withdrawal of time deposits	629	19	193
Payments for purchase of	(2,780)	(1,983)	(20,187)
property, plant & equipment
Proceeds from sales of	503	322	3,278
property, plant & equipment
Payments for purchase of	(156)	(270)	(2,749)
investment securities
Proceeds from sales of	99	91	926
investment securities
Purchase of investments in subsidiaries	(21)	(10)	(102)
Payments of loan receivable	(68)	--	--
Purchase of intangible assets	(6)	(6)	(61)
Other	(20)	(17)	(172)
Net cash used in investing activities	(1,921)	(2,249)	(22,895)

Cash flows from financing activities:
Payments of long-term debt	(53)	(5)	(51)
Cash dividends paid	(259)	(280)	(2,851)
Payments for purchase of treasury stock	(107)	(102)	(1,038)
Proceeds from sales of treasury stock	3	--	--
Net cash used in financing activities	(416)	(387)	(3,940)

Effect of exchange rate	(127)	(312)	(3,176)
changes on cash & cash equivalents
Net increase (decrease) in	126	906	9,223
cash & cash equivalents
Cash and cash equivalents at beginning of year	5,939	6,146	62,567

Increase in cash and cash equivalents	81	10	102
from newly consolidated subsidiary
Cash and cash equivalents at end of year	6,146	7,062	71,892

Segment Information

(1) Business segments

	JPY million
	For year ended 31 March 2008
	Ceramic Components		Lighting Equipment		Total		Eliminations or corporate		Consolidated
Net sales:
External customers	18,479		2,156		20,635		--		20,635
Inter-segment	20		--		20		(20)		--
Total net sales	18,499		2,156		20,655		(20)		20,635
Operating expenses	16,407		2,162		18,569		490		19,059
Operating income (loss)	2,092		(6)		2,086		(510)		1,576

	JPY million
	For year ended 31 March 2009
	Ceramic Components	Lighting Equipment		Total		Eliminations or corporate		Consolidated
Net sales:
External customers	14,916	1,777		16,693		--		16,693
Inter-segment	30	--		30		(30)		--
Total net sales	14,946	1,777		16,723		(30)		16,693
Operating expenses	15,109	1,755		16,864		340		17,204
Operating income (loss)	(163)	22		(141)		(370)		(511)

	USD thousand
	For year ended 31 March 2009
	Ceramic Components	Lighting Equipment		Total		Eliminations or corporate		Consolidated
Net sales:
External customers	151,848	18,090		169,938		--		169,938
Inter-segment	305	--		305		(305)		--
Total net sales	152,153	18,090		170,243		(305)		169,938
Operating expenses	153,812	17,866		171,678		3,462		175,140
Operating income (loss)	(1,659)	224		(1,435)		(3,767)		(5,202)

(2) Geographic segments

	JPY million
	For year ended 31 March 2008
	Japan	Asia	Europe & America	Total	Eliminations or corporate	Consolidated
Net sales:
External customers	15,515	3,712	1,408	20,635	--	20,635
Inter-segment	1,366	1,430	3	2,799	(2,799)	--
Total net sales	16,881	5,142	1,411	23,434	(2,799)	20,635
Operating expenses	15,310	4,635	1,351	21,296	(2,237)	19,059
Operating income	1,571	507	60	2,138	(562)	1,576

	JPY million
	For year ended 31 March 2009
	Japan	Asia	Europe & America	Total	Eliminations or corporate	Consolidated
Net sales:
External customers	13,013	2,413	1,267	16,693	--	16,693
Inter-segment	1,118	1,261	2	2,381	(2,381)	--
Total net sales	14,131	3,674	1,269	19,074	(2,381)	16,693
Operating expenses	14,271	3,739	1,210	19,220	(2,016)	17,204
Operating income	(140)	(65)	59	(146)	(365)	(511)

	USD thousand
	For year ended 31 March 2009
	Japan	Asia	Europe & America	Total	Eliminations or corporate	Consolidated
Net sales:
External customers	132,475	24,565	12,898	169,938	--	169,938
Inter-segment	11,382	12,837	20	24,239	(24,239)	--
Total net sales	143,857	37,402	12,918	194,177	(24,239)	169,938
Operating expenses	145,282	38,064	12,317	195,663	(20,523)	175,140
Operating income	(1,425)	(662)	601	(1,486)	(3,716)	(5,202)

(3) Net overseas sales by customer's geographic location

	JPY million
	For year ended 31 March 2008
	Asia		Europe		Other	Total
Overseas sales	7,305		813		623	8,741
Consolidated net sales						20,635
Percentage (%)	35.4%		3.9%		3.1%	42.4%

	JPY million
	For year ended 31 March 2009
	Asia	Europe			Other	Total
Overseas sales	5,061	766			837	6,664
Consolidated net sales						16,693
Percentage (%)	30.3%	4.6%			5.0%	39.9%

	USD thousand
	For year ended 31 March 2009
	Asia	Europe		Other		Total
Overseas sales	72,911	8,115		6,218		87,244
Consolidated net sales						169,938