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THK Co Ltd (47WH)

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Monday 29 November, 2004

THK Co Ltd

Interim Results

THK Company Limited
29 November 2004


                                                               November 18, 2004
Consolidated Financial Review for the Six Months
Ended Sep. 30, 2004


Company Name:                                                  THK CO., LTD
Head Office:                                                   Tokyo Japan (Tel: +81-3-5434-0300)
URL:                                                           http://www.thk.com/
Stock exchange listing:                                        Tokyo Stock Exchange 1st Section
Code number:                                                   6481
President and CEO:                                             Akihiro Teramachi
Director/General Manager of Corporate Strategy Department:     Kotaro Yoshihara
Date of the board meeting:                                     November 18, 2004
Application of U.S. GAAP:                                      None


1. Consolidated Financial Highlights (Unaudited)
Note: All figures are rounded down to nearest million yen.


(1) Operating result
                                          Net sales               Operating income             Ordinary income
                                   Millions            %   Millions                 %   Millions                 %
Six months                               of                      of                           of
Ended Sep.30, 2004                      yen                     yen                          yen
Six Months                                          37.5                        137.8
Ended Sep.30, 2003                   76,868                  15,329                       16,542             171.7
                                                    23.4                        267.5
                                     55,924                   6,447                        6,088             303.6
Year Ended Mar.31, 2004             119,253                  16,231                       15,892


                                            Net income            Net income     Fully
                                                                   per share    diluted
                                                                              net income
                                                                               per share
                                   Millions                     %         Yen         Yen
Six months                           of yen
Ended Sep.30, 2004                                          248.9       87.88       78.62
Six Months                           10,388
Ended Sep.30, 2003                                        1,074.3       25.19       21.98
                                      2,977
Year Ended Mar.31, 2004               8,853                             72.27       63.69


Notes:

1.  Profit/loss on equity
    method :Six Months
    ended Sep.30, 2004:
    Six Months ended
    Sep.30, 2003:
    Year ended Mar.31,
    2004:284million yen
    40million yen
    301million yen

2.  Average number of shares of common stock (consolidated) issued:

                                          Six Months ended Sep.30, 2004:           118,212,020 shares.
                                          Six Months ended Sep.30, 2003:            118,223,451shares.
                                                Year ended Mar.31, 2004:           118,090,965 shares.

3.  Change of accounting policy: None

4.  Percentages for net sales, operating income, ordinary and net income indicated changes from the
    previous term.


(2) Financial position
                                     Total assets          Shareholders'         Equity ratio         Shareholders'
                                                                 equity                                 equity per
                                                                                                             share
                                  Millions of yen       Millions of yen                    %                   Yen
Six months
Ended Sep.30, 2004                        205,848               118,190                 57.4                999.83
Six months
Ended Sep.30, 2003                        177,956               105,299                 59.2                892.26
Year ended Mar.31, 2004                   191,105               109,181                 57.1                923.35

Note: Number of shares of common stock (consolidated) issued as of
                              Six months ended Sep.30, 2004: 118,210,676 shares
                              Six months ended Sep.30, 2003: 118,013,568 shares
                                    Year ended Mar.31, 2004: 118,190,473 shares


(3)Consolidated cash flow position

                       Cash flow from        Cash flow from        Cash flow from     Cash and cash equivalents at
                 operating activities  Investing activities  financing activities           the end of the period
                      Millions of yen       Millions of yen       Millions of yen                 Millions of yen
Six months
Ended Sep.30,                   8,028               (3,000)                 (890)                          61,249
2004
Six months                      5,995               (2,651)              (25,911)                          50,129
Ended Sep.30,
2003
Year ended                     15,735               (3,681)              (27,132)                          57,037
Mar.31, 2004

(4)                      Scope of consolidation and application of equity method
 Consolidated            14 companies
subsidiaries:
                         Unconsolidated subsidiaries using the equity method:   0 company
                         Affiliates using the equity method:                    2 companies
(5)                      Changes in scope of consolidation and application of equity method
                         Consolidated companies:Additions: 0 companyDeletion:
                         0company
                         Companies using the equity method:                     Additions: 0      Deletion:
                                                                                company           0company


2. Corporate estimates for the year ending March 31, 2005(4/1/04/-3/31/05)

                                             Net sales   Operating income   Ordinary income          Net income
Year ending Mar.31, 2005               Millions of yen    Millions of yen    Millions of yen    Millions of yen
                                               143,000             25,400             26,700             16,500
For reference: Estimate of net income per share for the year ending March 31, 2005: 137.77 Yen
(By forecast average number of shares of common stock year of period)




                                  Status of the Corporate Group

The company's business group consists of twenty-two subsidiaries and four affiliated companies, which engage in the 
manufacture and distribution of the subcomponents of equipment and machinery, centering on linear motion systems, ball 
screws, and spherical joints.

These products are manufactured by the company itself, as well as by THK Niigata Co., Ltd. and Daito Seiki Co., Ltd., in
Japan, and by THK Manufacturing of America, Inc., THK Manufacturing of Europe S.A.S., PGM Ballscrews Ltd., PGM 
Ballscrews Ireland Ltd., and Samick LMS Co., Ltd. in foreign countries.

The company sells these products through its own distribution channels, Talk System Co., Ltd., and Daito Seiki Co., 
Ltd., in Japan, and using its own sales channels, THK America, Inc., THK Europe B.V., THK GmbH, THK FRANCE S.A.S. THK 
TAIWAN CO., LTD, and Samick LMS Co., Ltd., in foreign countries. 

A diagram of the main THK Group companies is as follows:
                                                                              Customers

                                     Products                               Products                     Products 
                                 Sales Subsidiaries      Products     Manufacturing & Sales             Affilited
                                   (Consolodated)                  Subsidiaries(Consolidated)           Companies
                                Talk System Co., LTD                   THK Manufacturing             (Accounted for by
                                THK America, Inc.                      of America, Inc.               equity method)
                                THK Europe B.V.                        THK Neturen America, L.L.C.   Daito Seiki Co.,   
                                THK GmbH                                                               Samick
                                                                       THK Manufacturing               Ltd.(*3)  LMS
                                THK FRANCE S.A.S.                      of Europe S.A.S.                          Co.,
Products    Products            THK TAIWAN CO., LTD.                   PGM Ballscrews Ltd.(*1)                   Ltd.
                                                                       PGM Ballscrews
                                                                       Ireland Ltd.

     

                                Products                               Parts       Product   Assembly  For   Product  
                                                                                   Parts            machinery  parts
                                                                                                    production
                                                  THK Co., Ltd.

            Product            Products                    Parts                Products 
            Parts
            Other Subsidiaries                                                 Manufacturing Subsidiaries
              (Consolidated)                                                         (Consolidated)
            Beldex Corporation                                                  THK Niigata Co., Ltd.(*2)


(*1)  PGM Ballscrews Ltd., a consolidated subsidiary as shown above, ceased business activities on July 1, 2004, and has
      begun liquidation on August 31, 2004.

(*2)  THK Niigata Co., Ltd., a consolidated subsidiary, used to be THK Yasuda Co., Ltd. The name was changed on July 1, 
      2004.

(*3)  Daito Seiki Co., Ltd., an affiliated company, will become a wholly-owned subsidiary effective on November 1, 2004,
      by stock swap.






                                                   Management Policy
(1) Basic Management Policies
    The company is a creativity and development-oriented enterprise that is well known as a world-leading maker of the
    Linear Motion Guide, and whose innovative technologies contribute to society. Supported by untiring
    research-and-development efforts, such contributions are the company's operating base.

    The company has constantly worked toward technological innovation (it holds 942 domestic and 909 overseas patents
    and patents pending), and will continue to keep its basic posture as a creativity and development-oriented
    enterprise. Based on its commitment to providing innovative products to the world, and to generate new trends that
    contribute toward an affluent society, the company aims to expand its business base and to eventually increase its
    enterprise value by aggressively cultivating new markets and areas, helped by its technologies and products.

(2) Basic Profit Sharing Policies
    The company's basic profit-sharing policy is to continue to pay stable dividends to its shareholders. The company
    believes that it is also important to appropriate earnings that correspond to actual earnings results, in an attempt
    to enhance its retained earnings and financial strength.

    The company will effectively use its retained earnings to reinvest in production equipment and facilities, and in
    information systems, responding to the future needs of R&D activities and of the globalization of its industry.

(3) Consideration and Policies on Deduction of Investment Units
    The company changed the number of shares constituting one trade unit from 1000 to 100, in accordance with a
    resolution adopted at the regular shareholders meeting held in June 1991.

    The company will continue to make effort to implement flexible policy as needed, toward expanding the shareholder
    base and enhancing the market liquidity of its stocks.

(4) Targeted Management Indexes
    To maximize shareholders' interest, the company considers return-on-equity to be the most important management
    index; it has set a goal of 10-percent ROE. The company places the greatest emphasis on profitability, to improve
    ROE, and therefore has also targeted a 20-percent operating profit ratio.

(5) Medium-term Management Strategy
    The company's unique Linear Motion Guide technology is an unrivaled new mechanism. This product has received much
    recognition and a high share in the Japanese market. There is greater potential overseas demand for Linear Motion
    Guide, due to their lower rate of use than in Japan.

    The company will aggressively cultivate overseas markets by supplying high-quality products, centering on Linear
    Motion Guide. To this end, it will strengthen its overseas sales system and focus on establishing a global
    manufacturing structure that can rapidly respond to local demand, based on the concept that production should be
    conducted as near as possible to the market of final demand. In this way, it aims to increase its overseas sales
    ratio to 50 percent (from the current 27.2 percent) over the long-term.

    The company will make great efforts to expand its business by increasing it presence in global markets, and by
    cultivating new products, and will aggressively pursue improved profitability and financial strength. In this way,
    it will attempt to increase the enterprise's value.

(6) Issues to Be Acted Upon
    The company produces and distributes subcomponents for equipment and machinery, including the Linear Motion Guide,
    ball screws, and other items. The main users of these products are manufacturers of industrial machinery, such as
    machine tools and semiconductor manufacturing devices. The company's earnings results are significantly influenced
    by trends in its clients' industries private sector capital investment and production.

    To mitigate fluctuations of business results, the company plans to expand its user base by accelerating overseas
    development and new business areas.

    The company's overseas marketing regions are Europe, America, and Asia. To choose the best production spots, the
    company will expand its sales by reinforcing its cost competency, and by making appeals for its high-level
    technologies to users by increasing production nearer to their locations.

    The company will also work toward gaining new business areas and markets, including electromechanics, housing, and
    automobile industries.

(7) Basic Policy of Corporate Governance
    To maximize shareholders' interest, the company aims for fair management by enhancing transparency to shareholders.
    The Board of Directors is composed of 15 members, none of whom are from outside the company. To segregate the
    management monitoring function from the business execution function, as is required of the Board of Directors, and
    to make the Board of Directors more efficient, the company has established as a supreme decision-making body a
    management meeting consisting mainly of executive directors.

    This management meeting invites certain responsible directors, as needed, to collect necessary information from
    them, and solicits objective opinions from such third parties as lawyers and accountants as well. Opinions of the
    meeting are put together after discussion. Based on such information and opinions, the meeting's members exchange
    views and assemble proposals for the Board of Directors to discuss and to make final decisions for the company.

    The company has also established the Internal Audit Office, to monitor the correctness of daily operations, and the
    appropriateness and efficiency of the management of the company and its affiliates at home and abroad. It is also
    working to strengthen the supervisory functions of the Corporate Auditors Meeting, which is composed of four
    auditors. The auditors of all group companies in Japan hold regular meetings to exchange information on auditing
    practices.

    The company will continue considering important the study of the pros and cons of introducing a committee system
    into its management structure, but will continue reforming the management structure and system within the current
    framework of the Board of Directors and Corporate Auditors Meeting.

    The company will continue to work to demonstrate complete compliance with laws, rules, and regulations, and to
    increase accountability to respond to the trust of shareholders and investors.



                                      Business Performance and Financial Standings

I. Business Performance
   (1)Summary of Business Performance for the Current Consolidated Interim Fiscal Year

   The Japanese economy showed steady recovery during the six months that ended on September 30, 2004, because capital
   investment increased with improvements in corporate earnings and the recovery of consumer spending, although there
   were some factors weighing on the economy, such as the sharp rise in crude oil prices. US consumer spending remained
   on the upswing, helped by an improved labor market, and the European economy also saw a mild recovery. The expansion
   of the Chinese economy activated capital investment in some parts of Asia, while the overseas economy generally
   continued to be strong.

   Under these circumstances, the company improved the development and rollout of new products, focusing on expanding
   overseas production capacity, and made domestic productivity improvements in an effort to accommodate increased
   demand. The company also worked to enhance its sales capabilities by aggressively promoting TAP-1 activities (THK
   Advantage Program 1), to increase the skills of salespeople in Europe and the US, where the company is trying to
   expand sales. Driven by these improvement efforts, and helped by a positive external environment (such as an increase
   in machinery demand in China, increasing capital investment in the automobile industry, and expansion of the digital
   home appliance market), sales to main users of our products (makers of machine tools, general machinery, and
   electronics) continued to be strong during the current interim fiscal year.

   Consolidated net sales for the six months ended September 30, 2004, were Y76,868 million, marking an increase of Y
   20,944 million (or 37.5 percent) since the previous interim fiscal year. The sales-cost ratio improved by 4.2
   percent, to 62.8 percent, from the 67.0 percent of the previous interim fiscal period, helped by a rise in capacity
   utilization (due to production increases and increased worker skills in overseas plants) and by a sharp rise in
   capacity utilization in domestic plants. With the successful suppression of increases in sales and administrative
   expenses, and despite soaring sales results, operating income marked Y15,329 million, up Y8,881 million (or 137.8
   percent) since the previous interim fiscal year. Ordinary income was Y16,542 million, up Y10,453 million (or 171.7
   percent) since the previous interim fiscal year, due to foreign exchange profit and an increase in gains on
   investment using the equity method. Net income was Y10,388 million, an increase of Y7,411 (or 248.9 percent) since
   the previous interim fiscal year.

   Summary of Consolidated Business Performance                                                        (Millions of Yen)

                   Six months ended Sep 30, 2003                      Six months ended Sep 30, 2004
                      Amount         %     Inc/Dec (%) from               Amount            % Inc/Dec (%) from
                                           2002 (interim)                                     2003 (interim)
   Net sales          55,924     100.0          23.4                      76,868     100.0        37.5
   Operating           6,447      11.5         267.5                      15,329      19.9       137.8
   income
   Ordinary income     6,088      10.8         303.6                      16,542      21.5       171.7
   Net income          2,977       5.3       1,074.3                      10,388      13.5       248.9

   Reference: Summary of Non-consolidated Business Performance                                (Millions of Yen)
                            Six months ended Sep 30, 2003                 Six months ended Sep 30, 2004
                           Amount         %   Inc/Dec (%) from      Amount         %        Inc/Dec (%) from
                                                2002 (interim)                                2003 (interim)
   Net sales              44,895       100.0       25.7              63,770       100.0                 42.0
   Operating income        6,938        15.4      155.5              13,684        21.5                 97.2
   Ordinary income         6,833        15.2      144.4              14,747        23.1                115.8
   Net income              3,801         8.5      149.7               8,885        13.9                133.8

   (2) Segment Information for the Current Consolidated Interim Fiscal Year

       Geographic segment information is as follows.

       Japan:
       Sales to machine tool and industrial robot makers continued to be firm, due to the
       recovery in capital investment, and sales to the electronics sector (including
       semiconductor and liquid crystal display makers) also remained strong, due to the
       expansion of the digital home appliance market. Net sales amounted to Y69,231 million, an
       increase of Y20,146 million (or 41.0 percent) since the previous interim fiscal year.
       Operating income was Y14,364 million, up Y7,404 million (or 106.4 percent) since the
       previous interim fiscal year.

       America:
       Sales to automobile makers, semiconductor manufacturing device makers, and medical
       equipment makers continued to be firm. Net sales increased by Y1,076 million (or 21.3
       percent) since the previous interim fiscal year, to Y6,129 million, although the yen was
       stronger against the US dollar than it was in the previous interim period. Operating
       income rose by Y770 million since the previous interim fiscal year, to Y694 million,
       thanks to improvements in the capacity utilization and productivity of THK Manufacturing
       of America, Inc.

       Europe:
       Sales to machine tool makers and semiconductor manufacturing device makers continued to
       be strong. Net sales increased by Y1,372 million (or 20.5 percent) since the previous
       interim fiscal year, to Y8,068 million. This is attributed to the increased adoption rate
       of the company's products and the successful cultivation of new clients. Operating income
       was Y446 million, an increase of Y832 million since the previous interim fiscal year, due
       to the improvement in capacity utilization and productivity of THK Manufacturing of
       Europe S.A.S. as in the case of the US manufacturing subsidiary.

       Asia and Other Regions:
       Sales to machine tools makers and the electronics industries were strong, driven by the
       expanded Chinese market. Net sales were Y1,646 million, an increase of Y483 million since
       the previous interim fiscal year. Operating income fell by Y4 million since the previous
       interim fiscal year, to Y30 million, due to decreased profitability brought on by the
       strong yen and the weak Taiwan dollar, and to the rise in sales and administrative
       expenses caused by the expense of system development to improve business efficiency.


       Note: The net sales above are those to external customers.


   (3)Profit-sharing for the Six Months Ended September 30, 2004

   The company decided to pay an interim fiscal year-end dividend of Y7.50 per share.


II.Financial Standings

(1)     Analysis of Balance Sheets
Total assets for the six months ended September 30, 2004, were Y205,848 million, an increase of Y14,743 million from the
previous consolidated fiscal year-end. This is mainly because current assets increased by Y13,936 million from the
previous fiscal year-end, attributed to a gain in accounts receivable, which was caused by increased sales. Liabilities
also increased by Y5,684 million from the previous fiscal year-end, to Y87,250 million. This is due mainly to an
increase in accounts payable, which was caused by rising materials purchases, reflecting increased sales.

Shareholders equity rose by Y9,008 million from the previous fiscal year-end, to Y118,190 million, attributed mainly to
an increase in net profit for the six months ended September 30, 2004.

(2)     Analysis of Statements of Cash Flows

        Cash Flows from Operating Activities:

        'Income before income taxes and others' for the current interim fiscal year increased by Y10,093 million from
        the previous consolidated interim fiscal year, to Y15,973 million, and depreciation expenses amounted to Y2,719
        million. As a result of tax payments, increases or decreases of working capital related current assets and
        liabilities-such as accounts receivable, inventories, accounts payable, and others, -net cash provided by
        operating activities amounted to Y8,028 million, an increase of Y2,032 million since the previous interim fiscal
        year.

        Cash Flows from Investing Activities:

        Net cash used in investment activities was Y3,000 million, an increase of Y349 million since the previous
        interim fiscal year, due to the purchases of fixed assets including the new Gifu Plant building.

        Cash Flows from Financing Activities:

        Net cash used in financing activities was Y890 million, due to dividends payment although decreased by Y 25,021
        million since the previous interim fiscal year.


        As a result, the outstanding balance of cash and cash equivalents increased over that of the previous interim   
        fiscal year by Y4,212 million during the current interim fiscal year, to Y61,249 million.

(3)     Analysis of Cash Flow Indices
                                             FY2002        FY2002        FY2003       FY 2003      FY2004
                                           (interim)                  (interim)                  (interim)
Equity ratio (%)                               55.8          53.0          59.2          57.1        57.4
Equity ratio on mark-to-market basis           98.5          70.2         127.5         127.1       106.4
(%)
Debt redemption years (years)                   5.6           3.9           6.4           2.4         4.7
Interest coverage ratio (multiples)            20.4          18.0          21.2          31.9        99.4

Equity Ratio: Shareholders equity as of fiscal year-end / Total assets as of fiscal year-end
Equity Ratio on a Mark-to-market Basis: Market capitalization of stocks as of fiscal year-end / Total assets as of
fiscal year-end
Debt Redemption Years: Interest-bearing debts as of fiscal year-end / Net cash flows provided by operating activities
Interest Coverage Ratio: Net cash flows provided by operating activities / interest payable



• These are all calculated using consolidated financial data.
• Market capitalization of stocks is calculated by multiplying the total number of stocks issued, by a closing stock
  price as of fiscal year-end.
• Corporate bonds with non-interest-bearing warrants and bills discounted are included in interest-bearing debts.

III. Earnings Projections
     (1)General Earnings Projections for the Fiscal Year Ending March 31, 2005

     The future economic environment surrounding the THK Group will continue to be hard to forecast, since economic
     recovery will probably falter due to destabilizing factors weighing down corporate earnings, such as sharply rising
     crude oil and raw-materials prices, and widely fluctuating foreign exchange rates. The group will build a stronger
     operating base by capitalizing on its tetra-lateral production and distribution systems covering Japan, North
     America, Europe, and Asia-Pacific, focusing on the achievement of three goals: 1) formulation and promotion of
     global strategies; 2) continued expansion in newly developing markets; and 3) creation of systems sensitive to
     demand fluctuations.
     Consolidated Earnings Projections for the Fiscal Year Ending March 31, 2005                   (Millions of Yen)

                                       Consolidated                                    Non-consolidated
                      Amount       %             Inc/Dec from           Amount       %             Inc/Dec from
                                                Fiscal 2004 (%)                                   Fiscal 2004 (%)
     Net sales         143,000     100.0                          19.9   117,000     100.0                          19.7
     Operating          25,400      17.8                          56.5    22,700      19.4                          40.2
     income
     Ordinary income    26,700      18.7                          68.0    23,600      20.2                          46.6
     Net income         16,500      11.5                          92.2    14,000      12.0                          58.5

     Annual average foreign exchange rate of Y108.50 per US$1 and Y134.20 per €1 is used to calculate earnings
     projections for the fiscal year ending March 31, 2005.

     (2) Dividend Projection for the Full Fiscal Year Ending March 31, 2005

     The THK Group marked all-time-high business earnings in the first half of fiscal 2004, and it also expects strong
     earnings results for the full fiscal year. Accordingly, the company plans to pay Y18.00 per share, up Y3.00 from
     the previous period, as dividends for the full fiscal year ending March 31, 2005, in appreciation for shareholders'
     support.

     For the interim dividend, however, the company plans to pay Y7.50 per share, instead of Y9.00, up Y1.50 from the
     previous interim period, because it should comply with the provisions concerning interim dividend payments
     specified in the stock swap agreement entered into with Daito Seiki Company Limited on July 26, 2004.
     Meanwhile, the company intends to pay Y10.50 per share, up Y3.00 from the previous fiscal year, as the fiscal
     year-end dividend, although this is subject to the resolution of an ordinary general shareholders' meeting
     scheduled for June 2005.




                                              Consolidated Balance Sheets
                                                                                                       (Millions of Yen)
                                      As of September 30, 2003  As of September 30, 2004  As of March 31, 2004
                                           Amount        %         Amount        %         Amount         %
      Assets
      Current assets:
          Cash on hand and in banks        50,082                  60,959                  56,550
          Notes and accounts               40,389                  55,485                  46,285
          receivable-trade                     
          Short-term investments in           
          securities                           77                     290                     516
          Inventories                      23,415                  22,899                  23,108
          Deferred tax assets               2,578                   2,853                   2,667
          Short-term loans                    205                     193                     173
          Other                             1,734                   2,232                   1,722
          Less: Allowance for doubtful      
          accounts                          (362)                   (270)                   (317)
           Total current assets           118,119     66.4        144,643     70.3       130,706        68.4
      Fixed assets:
          Tangible fixed assets
          Buildings and structures         15,388                  14,515                  14,946
          Machinery, Equipment and         14,660                  15,723                  15,593
          vehicles
          Land                             10,218                  10,165                  10,168
          Construction in progress          1,350                   1,947                     726
          Other                             1,496                   1,581                   1,546
           Total tangible fixed assets     43,113       24.2       43,934      21.3        42,982        22.5
          Intangible fixed assets           1,715        1.0        1,245       0.6         1,482         0.8
          Investment and other
          Long-term investments in          8,379                   8,488                   8,134
          securities
          Deferred tax assets               1,666                   1,350                   1,474
          Other                             5,402                   6,610                   6,750
          Less: Allowance for doubtful      (440)                   (424)                   (425)
          accounts
           Total investments and other     15,008        8.4       16,024       7.8        15,933         8.3
           Total fixed assets              59,837       33.6       61,204      29.7        60,398        31.6
      Total assets                        177,956      100.0      205,848     100.0       191,105       100.0




                                                                                                       (Millions of Yen)
                                      As of September 30, 2003   As of September 30, 2004  As of March 31, 2004
                                          Amount           %       Amount         %        Amount           %
     Liabilities
     Current liabilities:
         Notes and accounts payable-trade 20,206                   29,106                  24,219
         Short-term debt                      99                        -                       -
         Current portion of long-term        243                        -                       -
         debt
         Corporate income taxes payable    3,074                    5,873                   6,482
         and other
         Allowance for bonuses             1,298                    1,839                   1,433
         Other                             6,251                    9,127                   8,182
          Total current liabilities       31,174        17.5       45,947      22.3        40,318        21.1
     Long-term liabilities:
         Bonds                            15,000                   15,000                  15,000
         Bonds with stock acquisition     23,000                   23,000                  23,000
         rights
         Allowance for retirement and      1,507                    1,688                   1,631
         severance benefits
         Allowance for directors'          1,254                    1,345                   1,315
         and auditors' retirement
         benefits
         Other                               395                      269                     300
          Total long-term liabilities     41,158        23.1       41,303      20.1        41,247        21.6
          Total liabilities               72,333        40.6       87,250      42.4        81,565        42.7
     Minority interests
     Minority interests                      324         0.2          407       0.2           357         0.2
     Shareholders' equity
         Common stock                     23,106        12.9       23,106      11.2        23,106        12.0
     Capital reserve                      30,962        17.4       30,962      15.0        30,962        16.2
     Earned surplus                       51,118        28.7       65,288      31.7        55,836        29.2
     Valuation adjustment for marketable
     securities                              333         0.2          631       0.3           721         0.4
     Foreign currency translation          1,550         0.9        (468)     (0.2)         (120)       (0.0)
     adjustment                           
     Treasury stock                      (1,771)       (0.9)      (1,329)     (0.6)       (1,324)       (0.7)
     Total shareholders' equity          105,299        59.2      118,190      57.4       109,181        57.1
     Total liabilities, minority         177,956       100.0      205,848     100.0       191,105       100.0
     interests, and Shareholders' 
     equity





                                           Consolidated Statements of Income
                                                                                                       (Millions of Yen)
                                    Six months ended September  Six months ended September      Year ended March 
                                             30, 2003                   30, 2004                   31, 2004
                                            Amount         %     Amount             %      Amount           %

 Net sales                                     55,924  100.0           76,868   100.0         119,253   100.0
 Cost of sales                                 37,443   67.0           48,249    62.8          77,932    65.4
        Gross profit                           18,481   33.0           28,619    37.2          41,321    34.6
 Sales, general, and
 administrative expenses
      Packaging and transportation        829                   1,111                   2,073
      Advertising and promotions          364                     343                     710
      Provision for doubtful accounts       -                       0                      33
      Salaries and allowances           4,053                   4,138                   8,732
      Provision for employee bonuses      460                     679                     516
      Retirement expenses                  73                      82                     148
      Provision for directors' bonuses     60                      29                     121
      Rental expenses                     832                     864                   1,694
      Depreciation and amortization       292                     346                     603
      Research and development          1,154                   1,287                   2,520
      Other                             3,911  12,033   21.5    4,408  13,290    17.3   7,935  25,090    21.0
      Operating income                          6,447   11.5           15,329    19.9          16,231    13.6
     Non-operating income
      Interest income                      61                     117                     121
      Dividend income                      14                      20                      26
      Foreign exchange gain                 -                     516                       -
      Equity in earnings of                40                     284                     301
      unconsolidated subsidiaries
      and affiliates 
      Rental income                        78                      93                     159
      Other                               229     424    0.7      349   1,381     1.8     461   1,070     0.9
   Non-operating expenses
      Interest expenses                   283                      80                     493
      Payment costs                        20                      46                      65
      Foreign exchange loss               294                       -                     580
      Other                               185     783    1.4       41     168     0.2     271   1,409     1.2
      Ordinary income                           6,088   10.8           16,542    21.5          15,892    13.3


                                                                                                       (Millions of Yen)
                                       Six months ended September    Six months ended September     Year ended March 
                                              30, 2003                       30, 2004                  31, 2004
                                       Amount              %         Amount         %         Amount        %
     Extraordinary gain
       Gain on sales of property,           4                      22                      33
       plant and equipment                  
       Gain on sales of investment         35                       -                      35
       securities
       Reversal of allowance for            5      45    0.1        -      22     0.0       -      68     0.1
       doubtful accounts                              
     Extraordinary loss
       Loss on sales /disposals of        137                      46                     320
       property, plant and equipment
       Loss from investment securities     99                       -                       -
       revaluation
       Loss on liquidation of               -                       -                      99
       subsidiary company
       Loss on arrangement of               -                     545                       -
       subsidiary company
       Other                               17     254    0.4        -     591     0.7      19     439     0.4
    Income before income taxes                  5,879   10.5           15,973    20.8          15,520    13.0
     Income taxes - current             3,132                   5,605                   7,265
     Income taxes - deferred            (244)   2,887    5.2     (54)   5,551     7.3   (338)   6,926     5.8
     Minority interest income of                   14    0.0               32                      10     0.0
     consolidated subsidiaries
        Net income                              2,977    5.3           10,388    13.5           8,583     7.2





                                      Consolidated Statements of Retained Earnings
                                                                                                       (Millions of Yen)
                                              Six months ended         Six months ended          Year ended 
                                             September 30, 2003       September 30, 2004       March 31, 2004
      Capital surplus

      Consolidated capital surplus at                   30,962                  30,962                 30,962
      beginning of the period
      Consolidated capital surplus at                   30,962                  30,962                 30,962
      end of the period

      Earned surplus

      Consolidated earned surplus at                    48,686                  55,836                 48,686
      beginning of the period

      Increase in earned surplus

          Net Income                         2,977                  10,388                 8,583

          Increase from accounting for         378       3,356           -      10,388       378        8,962
          investment in an affiliate by the
          equity method

      Decrease in earned surplus

          Dividends                            895                     887                 1,782

          Bonuses to directors                  30                      50                    30
          (bonuses to auditors)                (4)         925         (7)         937       (4)        1,812
      Consolidated earned surplus at end                51,118                  65,288                 55,836
      of the period





                                         Consolidated Statements of Cash Flows
                                                                                                       (Millions of Yen)
                                                                Six months     Six months     Year ended
                                                                  ended          ended         March 31,
                                                               Sep. 30, 2003  Sep. 30, 2004     2004
Cash flows from operating activities:
    Income before income tax and minority interests               5,879         15,973        15,520
    Depreciation and amortization                                 2,646          2,719         5,566
    Loss on sales or disposal of property, plant and
    equipment                                                       132             23           287
    Loss on liquidation of subsidiary company                         -              -            99
    Loss on arrangement of subsidiary company                         -            545             -
    Increase (decrease) in provisions                                66            445           338
    Interest and dividend income                                   (75)          (138)         (147)
    Interest expense                                                283             80           493
    Foreign exchange gain (loss)                                     21          (296)           108
    Equity in earnings of unconsolidated subsidiaries and
    affiliates                                                     (40)          (284)         (301)


    Increase (decrease) in notes and accounts receivable         (5,058)        (9,231)      (11,293)
    Increase (decrease) in inventories                              710            181           395
    Increase (decrease) in notes and accounts payable             2,920          4,921         7,337
    Other                                                           455           (657)           78
     Subtotal                                                     7,942         14,281        18,484
    Interest and dividend received                                  118            200           192
    Interest paid                                                  (337)           (80)         (495)
    Income taxes paid                                            (1,727)        (6,373)       (2,446)
     Net cash provided by operating activities                    5,995          8,028        15,735
Cash flows from investing activities:
    Increase in time deposits due over three months                   -             30             -
    Proceeds from sales of short-term investments in                       
    securities                                                      919              -           907
    Payments for purchases of property, plant and equipment      (2,500)        (2,663)       (5,105)
    Proceeds from sales of property, plant and equipment             61             93            81
    Payments for purchases of long-term investment
    securities                                                     (293)          (466)          309
    Proceeds from sales of long-term investment securities          244              2         1,793
    Payments for loans                                           (1,180)          (400)       (1,183)
    Collection of loans                                              98            403           135
     Net cash provided by investing activities                   (2,651)        (3,000)       (3,681)
Cash flows from financing activities:
    Increase (decrease) in short-term debt                       (3,210)             -        (3,303)
    Repayments of long-term debt                                 (3,354)             -        (3,598)
    Redemption of bonds                                         (17,344)             -       (17,334)
    Cash dividend                                                  (895)          (885)       (1,784)
    Other                                                        (1,106)            (5)       (1,111)
       Net cash provided by financing activities                (25,911)          (890)      (27,132)
Effect of exchange rate change on cash and cash
equivalents                                                         162             74          (418)
Net increase in cash and cash equivalents                       (22,404)         4,212       (15,496)
Cash and cash equivalents at beginning of the period             72,533         57,037        72,533
Cash and cash equivalents at end of the period                   50,129         61,249        57,037



Basis for Preparing Interim Consolidated Financial Statements

1. Scope of Consolidation
   (1) Number of consolidated subsidiaries: 14
       Talk System Co., Ltd.; Beldex Corporation; THK Niigata Co., Ltd.; THK Holdings of America, L.L.C.; THK America,
       Inc.; THK Manufacturing of America, Inc.; THK Neturen America, L.L.C.; THK Europe B.V.; THK GmbH; THK
       Manufacturing of Europe S.A.S.; THK FRANCE S.A.S.; PGM Ballscrews Ltd.; PGM Ballscrews Ireland Ltd.; THK Taiwan
       Co., Ltd.
   (2) Main unconsolidated subsidiaries:
       Dalian THK Co., Ltd.   Nippon Slide Co., Ltd.
   (3) Reasons for excluding unconsolidated subsidiaries from the consolidation:
       The unconsolidated subsidiaries are small, and their total assets, sales, net incomes (corresponding to equity
       portion), and retained earnings (corresponding to equity portion), have no material effect on the company's
       interim consolidated financial statements.

2. Use of the Equity Method
   (1) Number of affiliated companies accounted for using the equity method: 2
       Daito Seiki Co., Ltd.    Samick LMS Co., Ltd.
   (2) Names of main unconsolidated subsidiaries and affiliated companies not accounted for using the equity method:
       Dalian THK Co., Ltd.    Nippon Slide Co., Ltd.
   (3) Reason for excluding unconsolidated subsidiaries from those subject to the equity method:
       Net income (corresponding to equity portion) and retained earnings (corresponding to equity portion) of these
       subsidiaries have no material effect on the company's interim consolidated statements, and they are of no
       importance as a whole, even though they are not accounted for using the equity method.

3. Fiscal Years of consolidated subsidiaries
   The following consolidated subsidiaries' interim fiscal year-ends are on June 30.

   THK Holdings of America, L.L.C.; THK America, Inc.; THK Manufacturing of America, Inc.; THK Neturen America,L.L.C.;
   THK Europe B.V.; THK GmbH; THK Manufacturing of Europe S.A.S.; THK France S.A.S.; PGM Ballscrews Ltd.; PGM Ballscrews
   Ireland Ltd.; THK Taiwan Co., Ltd.

   Adjustments have been made for significant transactions between subsidiaries' interim fiscal year-ends and September
   30.

4. Summary of Significant Accounting Policies
   (1) Evaluation of significant assets
       Other securities:

       i.  Securities

           Marketable Securities: Stated at market value at the interim fiscal year-end (valuation gains and losses are
           included in shareholders' equity, net of taxes, and costs of sales are calculated using the moving-average
           method).
           Non-marketable Securities: Stated at costs determined using the moving-average method.

       ii. Inventories

           Company name                  Asset Evaluation Method                       Evaluation Standard
           THK Co., Ltd.                 Mainly weighted average method                Cost method
           Talk System Co., Ltd.         Mainly weighted average method                Cost method
           Beldex Corporation            Mainly actual cost method                     Cost method
           THK Niigata Co., Ltd.         Mainly weighted average method                Cost method
           THK America, Inc.             First-in-first-out method                     Lower of cost or market
           THK Manufacturing of America, First-in-first-out method                     Lower of cost or market
           Inc.
           THK Neturen America, L.L.C.   First-in-first-out method                     Lower of cost or market
           THK Europe B.V.               Moving average method                         Lower of cost or market
           THK Manufacturing of Europe   Mainly weighted average method                Cost method
           S.A.S.
           THK France S.A.S.             Moving average method                         Lower of cost or market
           THK GmbH                      Moving average method                         Lower of cost or market
           PGM Ballscrews Ltd.           First-in-first-out method                     Lower of cost or market
           PGM Ballscrews Ireland Ltd.   First-in-first-out method                     Lower of cost or market
           THK Taiwan Co., Ltd.          Moving average method                         Lower of cost or market

   (2) Method of depreciation and amortization

       i.Tangible Fixed Assets          The tangible fixed assets of the company and its domestic
                                        subsidiaries are depreciated using the declining-balance method, and
                                        those of overseas consolidated subsidiaries are depreciated using
                                        either the straight-line method or the accelerated depreciation
                                        method, depending on their local accounting standards. The amount of
                                        depreciation for buildings (excluding fixtures to buildings)
                                        acquired on and after April 1, 1998, by the company and its domestic
                                        subsidiaries is estimated using the straight-line method.
                                        The useful lives of main properties are as follows:
                                           Buildings and structures.......................... 5-50 years
                                           Machinery, equipment, and vehicles................ 4-10 years

       ii.Intangible Fixed Assets       The straight-line method is used by the company and its consolidated
                                        subsidiaries. Software costs for their internal use are amortized
                                        using the straight-line method over their estimated useful lives (5
                                        years).
                                        The intangible fixed assets of overseas consolidated subsidiaries
                                        are amortized using the declining-balance method, based on their
                                        local accounting standards.


   (3) Accounting for major lease transactions
       Finance lease transactions, excluding those in which the ownership of the leased properties is transferred to the
       lessee, are accounted for in the same manner as operating leases.

   (4) Accounting standards for major allowances

       i. Allowance for doubtful        To prepare for possible losses caused by irrecoverable money claims
          accounts                      at the fiscal year-end, the company and its subsidiaries provide
                                        allowances as follows:
                                        For general credit claims, allowance is provided for the amount
                                        calculated based on the past credit loss experience, and for
                                        specifically doubtful credit claims, allowance is provided for the
                                        estimated uncollectible amount based on the collectibility
                                        assessment for individual credit claims.
                                        Overseas consolidated subsidiaries provide allowances for the
                                        amounts they deem necessary, considering the collectibility of
                                        specific doubtful credit claims.
       ii.  Allowance for bonuses       Allowance for employee bonuses is provided in provisions for payment
                                        of bonuses to employees in the amount of estimated bonuses, which
                                        are attributable to the current interim consolidated fiscal year.
       iii. Allowance for employees'    Allowance for employee retirement benefits is provided in provision
            retirement benefits         for payment of retirement benefits to employees in the amount deemed
                                        accrued at the end of the current interim consolidated fiscal year,
                                        based on the projected retirement benefit obligation and fair value
                                        of plan assets at this fiscal year end.
                                        Unrecognized net actuarial difference is amortized using the
                                        straight-line method over a number of years (usually 10 years)
                                        within the employees' average remaining employment period,
                                        commencing from the next fiscal year in which they arise (stated as
                                        either income or expense in the statement of income).
       iv. Allowance for directors' and Allowance is provided for the amount the company would have to pay
           auditors' retirement         at the end of the interim fiscal year, which is estimated in
           benefits                     accordance with internal regulations. The system for paying
                                        retirement benefits to directors and auditors, however, was
                                        abolished in June 2004, so the outstanding balance of this allowance
                                        represents an estimated amount for payment to the directors and
                                        auditors currently holding offices under the previous system.

   (5) Hedge accounting

       i. Method of hedge accounting      Currency swap transactions meet the requirement of allocation
                                          treatment, and are accounted for accordingly.
       ii. Hedging instruments and hedged Hedging instrument Currency     Hedged items
           items                          swap transaction                Foreign currency denominated
                                                                          money claims
       iii.Hedging policy                 The company uses currency related hedge accounting for the
                                          purpose of fixing cash flows related to the collection of
                                          principal and interest on loans.
       iv. Assessment method for the      The company omits the assessment of the effectiveness of hedges
           effectiveness of hedges        for currency swap transactions, because the significant terms
                                          and conditions for such transactions and for hedged assets are
                                          identical, and are assumed beforehand to offset exchange rate
                                          risks and cash flow fluctuations continuously from the time
                                          hedging is initiated.

   (6) Other significant items to prepare interim consolidated financial statements
       Consumption taxes                Consumption taxes are excluded from the transaction amounts.

5. Scope of Funds Stated in the Interim Consolidated Statements of Cash Flows
   The funds (cash and cash equivalents) stated in the interim consolidated statements of cash flows are composed of
   cash on hand, bank deposits that can be withdrawn on demand, and short-term investments with original maturities of
   up to three months that are exposed to minor value fluctuation risk.
   
   Additional Information
   Since the company has used a size-based corporate tax system since the beginning of the current interim fiscal
   period, sales and general administrative expenses increased by Y157 million, and operating income, ordinary income,
   and net income before taxes each decreased by Y157 million.



                                                         Notes

Interim Consolidated Balance Sheets                                                         (Millions of Yen)
                                                              FY2003              FY2004              FY2003
                                                             Interim             Interim
Accumulated depreciation and amortization of                  66,136              69,861              67,862
tangible fixed assets
Liabilities for guarantee                                        300                 214                 263

Interim Consolidated Statements of Cash Flow
Relationships of outstanding balance of cash and cash equivalents as of the end of the interim period and the amounts of
account items stated in the interim consolidated balance sheets.
                                                                                              (Millions of Yen)
                                                              FY2003              FY2004              FY2003
                                                             Interim             Interim
Cash on hand and deposits with banks                          50,082              60,959              56,550
Securities                                                        77                 290                 516
                                          Total:              50,159              61,249              57,067
Time deposits (term exceeding three months)                     (30)                   -                (30)
                      Cash and Cash Equivalents:              50,129              61,249              57,037

Lease Transactions

Data on lease transactions is omitted, because they have been disclosed via EDINET for the fiscal half-year ended
September 30, 2004.

                                                  Segment Information

1.  Business Segment Information
    Net sales and operating income of machinery subcomponent departments exceed 90 percent of the consolidated
    net sales of all segments, and of the total operating income of segments that generated operating income,
    and so segment information by business category is omitted.

2.  Geographic Segment Information

    For the six monthsending ended September 30, 2003                                          (Millions of Yen)

                                  Japan   America   Europe  Asia and    Total    (Elimination)  Consolidated
                                                              others
    Net Sales:
       To customers              43,107     5,021     6,632    1,163   55,924               -        55,924
       Inter-segment              5,976        31        63        -    6,071         (6,071)             -
                       Total:    49,084     5,052     6,695    1,163   61,996         (6,071)        55,924
    Operating expenses           42,124     5,129     7,081    1,128   55,463         (5,986)        49,476
    Operating Income (loss):      6,959      (76)     (385)       34    6,532            (85)         6,447



    For the six monthsending ended September 30, 2004                                          (Millions of Yen)

                                  Japan    America   Europe Asia and    Total    (Elimination)  Consolidated
                                                              others
    Net Sales:
       To customers              61,133     6,105     7,982    1,646   76,868               -        76,868
       Inter-segment              8,097        23        85        -    8,206         (8,206)             -
                       Total:    69,231     6,129     8,068    1,646   85,075         (8,206)        76,868
    Operating expenses           54,866     5,434     7,621    1,616   69,539         (8,000)        61,539
    Operating Income (loss):     14,364       694       446       30   15,535           (206)        15,329


    For the year ending ended March 31, 2004                                                   (Millions of Yen)

                                  Japan  America   Europe   Asia and    Total    (Elimination)   Consolidated
                                                              others
    Net Sales:
       To customers              93,771    10,341    12,742    2,399  119,253               -       119,253
       Inter-segment             12,654        53       117        -   12,824        (12,824)             -
                       Total:   106,425    10,394    12,859    2,399  132,078        (12,824)       119,253
    Operating expenses           89,727    10,608    13,665    2,347  116,348        (13,326)       103,022
    Operating Income (loss):     16,698     (214)     (805)       51   15,729             501        16,231
    Note:

    •    Classification of countries and regions is based on geographical proximity.
    •    Main countries and areas belonging to each classification are as follows.

         America:             United States of America and other countries
         Europe:              Germany, UK, Netherlands, and other countries
         Asia and others:     South Korea, Taiwan and other countries

3.  Overseas Sales

    For the six months ending ended September 30, 2003                                         (Millions of Yen)
                                                     America            Europe     Asia and others         Total
    Overseas sales                                     5,073             6,630           4,857            16,562
    Consolidated net sales                                                                                55,924
    Overseas sales as a percentage of                   9.1%             11.8%            8.7%             29.6%
    consolidated net sales


    For the six months ending endedSeptember 30, 2004                                          (Millions of Yen)
                                                     America            Europe      Asia and others        Total
    Overseas sales                                     6,159             7,963           6,811            20,934
    Consolidated net sales                                                                                76,868
    Overseas sales as a percentage of                   8.0%             10.3%            8.9%             27.2%
    consolidated net sales


    For the year ending ended March 31, 2004                                                   (Millions of Yen)
                                                     America            Europe      Asia and others        Total
    Overseas sales                                    10,436            12,739          10,734            33,910
    Consolidated net sales                                                                               119,253
    Overseas sales as a percentage of                   8.7%             10.7%            9.0%             28.4%
    consolidated net sales


    Note:
    •    Classification of countries and regions is based on geographical proximity.
    •    Main countries and areas belonging to each classification are as follows.
         America:             United States of America and other countries
         Europe:              Germany, UK, Netherlands, and other countries
         Asia and others:     South Korea, Taiwan and other countries
    •    Overseas sales are sales booked in foreign countries or in regions other than Japan, by the company and
         its consolidated subsidiaries.


                                              Securities

1. Marketable Securities
                                                                                                       (Millions of Yen)
                    As of September 30, 2003          As of September 30, 2004          As of March 31, 2004
             Acquisition      Book  Difference Acquisition      Book  Difference Acquisition      Book    Difference
                    cost     value                    cost     value                    cost     value
   Equities        2,399     2,750         351       2,384     3,406       1,022       2,360     3,542       1,182
   Others             15        18           2           7         8           1           9        11           1
      Total:       2,414     2,769         354       2,391     3,415       1,023       2,370     3,554       1,183

   Note: In addition to the above, differences between acquisition costs and book values in the group's equity portion
   in investment partnership are included under 'Valuation adjustment for marketable securities' on the balance sheets.
   Such differences are Y26 million for the six months ending ended September 30, 2003, Y38 million for the six months
   ending ended September 30, 2004, and Y27 million for the fiscal year ending ended March 31, 2004, all of which are
   nets of tax effect amounts.


   When an issue's market value of the equities stated in the table above falls by 50 percent or more below its
   acquisition cost, the company makes it a rule to write them down. For securities whose market values are 30 percent
   or more, or more than 50 percent below their acquisition costs, the company judges whether to write them down by
   assessing issuers' financial conditions as of their latest fiscal year-ends, and their earnings results for the last
   two fiscal years, and by comparing each issue's acquisition cost with its average month-end closing price for the
   last 24 months.

2. Breakdown of Main Non-marketable Securities
                                                                                               (Millions of Yen)
                                          As of Sept 30, 2003     As of Sept 30, 2004      As of March 31, 2004
                                                   Book value              Book value                Book value
   Other securities                                       175                     157                       175
     Unlisted equities (non-OTC)                        1,500                       -                         -
     Unlisted foreign bonds                                77                     290                       516
     Unlisted foreign investment trust




                                             Significant Subsequent Events

For the six months ending ended September 30, 2003:
  There were no corresponding events.

For the six months ending ended September 30, 2004:
  Stock swap with Daito Seiki Co., Ltd.

  The company's board of directors resolved at a meeting on July 26, 2004, to make Daito Seiki Company Limited a
  wholly-owned subsidiary, by applying a stock-swap scheme in accordance with Article 358, paragraph 1, of the
  Commercial Code, for the purpose of consolidating management resources and enhancing investment efficiency within the
  THK Group. This stock swap was approved by an extraordinary general shareholders' meeting of Daito Seiki Company
  Limited on September 24, 2004, and executed on November 1, 2004.

  With this stock swap, two-tenths of one common share of the company was allocated to one share of Daito Seiki Company
  Limited. To implement this stock swap, the company allocated and delivered 1,000,000 treasury shares and issued new
  554,508 shares.

For the year endedending March 31, 2004:
  There were no corresponding events.





                                                                        November 18, 2004
Non-Consolidated Financial Review for the Six Months         
Ended September 30, 2004


Company Name:                                                           THK CO., LTD.
Head Office:                                                            Tokyo Japan (Tel: +81-3-5434-0300)
URL:                                                                    http://www.thk.com/
Stock exchange listing:                                                 Tokyo Stock Exchange 1st Section
Code number:                                                            6481
President and CEO:                                                      Akihiro Teramachi
Director/General Manager of Corporate Strategy Department:              Kotaro Yoshihara
Date of the board meeting:                                              November 18, 2004
Interim cash dividends:                                                 Yes
Application of Unit stock system:                                       Yes(1 unit 100 shares)

1. Consolidated Financial Highlights (Unaudited)
Note: All figures are rounded down to the nearest million yen.

(1) Operating result
                                              Net sales                Operating income               Ordinary income
                                     Millions              %   Millions                  %   Millions                %
Six months                                 of                        of                            of
Ended Sep.30, 2004                        yen                       yen                           yen
Six Months                             63,770       42.0         13,684               97.2     14,747             115.8
Ended Sep.30, 2003                     44,895       25.7          6,938              155.5      6,833             144.4
Year Ended Mar.31, 2004                97,740                    16,186                        16,099
                                               
                                                      Net income          Net income
                                                                           per share
                                         Millions of                   %         Yen
Six months                                       yen
Ended Sep.30, 2004                             8,885               133.8       75.08
Six Months                                     
Ended Sep.30, 2003                             3,801               149.7       32.06
                                               
Year Ended Mar.31, 2004                        8,831                           74.18


Notes:

1.   Change of accounting policy: None
2.   Average number of shares of common stock issued (non-consolidated)
               Six Months ended Sep.30, 2004: 118,345,420 shares.
               Six Months ended Sep.30, 2003: 118,558,752 shares.
               Year ended Mar.31, 2004:       118,387,267 shares.

3.   Regarding net sales, operating income, ordinary income and net income, percent indications show
     percentage changes from the same period of the previous year.

(2) Cash dividends
                                         Annual Dividends per share
                                       Interim                             Full year
                                           Yen                                   Yen
Six months
Ended Sep.30, 2004                        7.50                                     -
Six Months
Ended Sep.30, 2003                        7.50                                     -
Year Ended Mar.31, 2004                      -                                 15.00

(3) Financial position
                                   Total assets    Total shareholders'        Equity ratio   Shareholder's equity
                                                               equity                                   per share
                                Millions of yen       Millions of yen                    %                   Yen
Six months
Ended Sep.30, 2004                      195,663               113,615                 58.1                960.04
Six Months
Ended Sep.30, 2003                      167,630               101,127                 60.3                854.48
Year Ended Mar.31, 2004                 181,983               105,760                 58.1                893.23


Notes:

1.  Net number of shares issued and outstanding at the end of the fiscal year (non-consolidated)
              Six months ended Sep.30, 2004:      118,344,076 shares
              Six months ended Sep.30, 2003:      118,348,869 shares.
              Year ended Mar.31, 2004:            118,346,697 shares.

2.  The number of treasury stock as of :
              Six months ended Sep.30, 2004:      1,018,942 shares.
              Six months ended Sep.30, 2003:      1,014,149 shares.
              Year ended Mar.31, 2004:            1,016,321 shares.

2. Projections of Non-Consolidated Results for the Fiscal Year ending March 31, 2005
                               Net sales    Operating    Ordinary     Net income   Annual cash dividends
                                            income       Income                    per share
                               Million of   Million of   Million of   Million of   Yen
                               yen          yen          yen          yen
                                                                                   F.Y. end
Year ending Mar.31, 2005       117,000      22,700       23,600       14,00010.518
For reference: Estimate of net income per share for the year ending March 31, 2005: 116.77 Yen
(By forecast average number of shares of common stock year of period)

*Forward-Looking Statements:
This release contains forward-looking statements that are based on management's estimates, assumptions and projections
at the time of release. Some factors, which include, but are not limited to, the risks and uncertainty associated with
the worldwide economy, competitive activity and currency fluctuation, could cause actual results to differ materially
from expectations.

Note to the Financial Information:
This is summarized and translated financial information that the Company posted to the Tokyo Stock Exchange in
accordance with their rules that governs the disclosure of financial information.
The Company maintains an Internet website at www.thk.co.jp. The Company makes available free of charge on the website
its financial information in Japanese language. Those information translated in English language will be disclosed as
soon as reasonably practicable after disclosing materials in Japanese language.





                                            Non-Consolidated Balance Sheets
                                                                                                       (Millions of Yen)
                                              As of September 30,     As of September 30,    As of March 31, 2004
                                              2003                    2004
                                              Amount      %           Amount      %          Amount     %
      Assets
      Current assets:
          Cash on hand and in banks           43,386                  52,413                 49,298
          Notes receivable-trade              15,297                  20,387                 17,100
          Accounts receivable-trade           21,613                  33,199                 26,865
          Inventories                         13,749                  14,674                 14,250
          Deferred tax assets                 1,327                   1,714                  1,670
          Short-term loans                    6,840                   7,389                  7,491
          Other                               1,104                   1,446                  1,420
          Less: Allowance for doubtful         
          accounts                             (131)                    (93)                  (134)
            Total current assets            103,188     61.6        131,132     67.0       117,963      64.8
      Fixed assets:                    
          Tangible fixed assets
          Buildings and structures            8,836                   8,597                  8,848
          Machinery and equipment            10,834                  11,443                 11,238
          Land                                9,104                   9,094                  9,094
          Other                               1,876                   2,736                  1,609
            Total Tangible fixed assets      30,652     18.2         31,871     16.3        30,790      16.9
      Intangible fixed assets                 1,603      1.0          1,125      0.6         1,357       0.8
      Investments and others
          Long-term investments in securities 4,389                   3,564                  3,721
          Investments in shares of subsidiary 
          and affiliated company             12,058                  12,530                 12,069
          Investments in subsidiary and       6,720                   7,777                  7,777
          affiliated company
          Deferred tax assets                 1,626                   1,307                  1,430
          Other                               7,789                   6,731                  7,568
          Less: Allowance for doubtful         
          accounts                             (397)                   (376)                  (696)
            Total investments and others     32,186     19.2         31,534     16.1         31,871      17.5
            Total fixed assets               64,442     38.4         64,531     33.0         64,019      35.2
      Total assets                          167,630    100.0        195,663    100.0        181,983     100.0


                                                                                                       (Millions of Yen)

                                         As of September 30, 2003     As of September 30, 2004     As of March 31, 2004

                                              Amount          %            Amount          %           Amount       %
     Liabilities
       Current liabilities:
          Notes payable-trade                  4,205                        5,859                       5,176
          Accounts payable-trade              12,490                       20,560                      15,937
          Accounts payable-other               1,035                        1,451                       1,209
          Accrued expenses                     3,149                        4,095                       3,833
          Corporate income taxes payable and   3,006                        5,654                       6,307
          other
          Accrued bonuses                      1,219                        1,737                       1,346
          Notes payable-equipment and other      376                        1,478                         942
          Other                                  405                          365                         721
            Total current liabilities         25,888        15.5           41,204        21.0          35,476      19.5
      Long-term liabilities:
          Bonds                               15,000                       15,000                      15,000
          Bonds with stock acquisition rights 23,000                       23,000                      23,000
          Allowance for retirement and 
          severance                            1,355                        1,495                       1,428
          Benefits
          Allowance for director's and         
          auditor's retirement benefits        1,254                        1,345                       1,315
          Other                                    4                            3                           3
            Total long-term liabilities       40,615        24.2           40,843        20.9          40,747      22.4
            Total liabilities                 66,503        39.7           82,048        41.9          76,223      41.9
     Shareholders' equity
     Common stock                             23,106        13.8           23,106        11.8          23,106      12.7
     Additional paid-in capital     
          Capital reserve                     30,962                       30,962                      30,962
            Total additional paid-in capital  30,962        18.5           30,962        15.9          30,962      17.0

     Surplus
          Earned reserves                      1,958                        1,958                       1,958
          Other reserves                      40,523                       47,661                      40,523
          Unappropriated retained earnings     5,480                       10,443                       9,623
            Total surplus                     47,963        28.6           60,053        30.7          52,105      28.6

     Valuation adjustment for marketable
     securities                                  223         0.1              630         0.3             718       0.4
      Treasury stock                          (1,127)        0.7           (1,137)        0.6          (1,132)      0.6
      Total shareholder's equity             101,127        60.3          113,615        58.1         105,760      58.1 
      Total liabilities and shareholder's    
      equity                                 167,630       100.0          195,663       100.0         181,983     100.0



                                         Non-Consolidated Statements of Income
                                                                                                       (Millions of Yen)
                                Six months ended Sep.30, 2004  Six months ended Sep.30, 2003  Year ended March 31, 2004

                                      Amount          %            Amount           %              Amount           %

  Net sales                           44,895       100.0          63,770         100.0            97,740         100.0
 Cost of sales                        30,606        68.2          41,473          65.0            65,770          67.3
        Gross profit                  14,288        31.8          22,297          35.0            31,970          32.7
 Selling, general and                  7,349        16.4           8,612          13.5            15,784          16.1
  administrative expenses
        Operating income               6,938        15.4          13,684          21.5            16,186          16.6
  Non-operating income
      Interest income            81                           88                            183
      Dividend income            56                           84                             67
      Foreign exchange gain       -                          603                              -
     Other                      294      433          1.0    443   1,219           1.9      631       882          0.9
  Non-operating expenses
      Interest expenses           9                            0                              9
      Bond interest             118                           80                            197
      Foreign exchange loss     246                            -                            518
     Other                      163      538          1.2     76     156           0.3      243       969          1.0
        Ordinary income                6,833         15.2         14,747          23.1             16,099         16.5
   Extraordinary gain
      Gain on sales of 
      property plant,                                  
      and equipment               0                           18                             58
      Reversal of allowance for               
      doubtful accounts          25                           26                              -
      Other                      35       61           0.2     -      44           0.1       35        94          0.1
  Extraordinary loss
      Loss on disposals of       
      property, plant and 
      equipment                 112                           40                            195
      Valuation loss on 
      investment in 
      subsidiary company         99                            -                              -
      Loss on liquidation of     
      subsidiary company          -                            -                             99
      Loss on forgiveness of     
      subsidiary company debt     -                            -                            563
      Loss on arrangement of       
      subsidiary company          -                          473                              -
      Other                      17      229           0.6     -     513            0.8      19       877          0.9
 Income before income taxes            6,665          14.8        14,278           22.4            15,316         15.7
 Income taxes - current       3,023                        5,253                          7,130
 Income taxes - deferred       (159)   2,864           6.3   139   5,393            8.5    (645)    6,484          6.7
         Net income                    3,801           8.5         8,885           13.9             8,831          9.0
  Unappropriated retained earnings     1,679                       1,547                            1,679
  brought forward                      
  Interim dividend                         -                           -                              887
  Unappropriated retained earnings     5,480                      10,433                            9,623


                           Basis for Preparing Interim Non-Consolidated Financial Statements

1.    Evaluation of Assets

      (1)   Securities
               
            i.   Stocks of subsidiaries and  Stated at costs determined using the moving-average method.
                 affiliated companies

            ii.  Other securities
                 Marketable securities:     Stated at the market value at the interim fiscal year-end
                                            (valuation gains/losses are included in shareholders' equity; net
                                            of taxes and sales costs are calculated using the moving-average
                                            method).

            Non-marketable securities:      Stated at costs determined using the moving-average method.

      (2)   Inventories
            i.   Products/Finished goods    Stated at cost determined using the weighted-average method.
            ii.  Merchandise                Stated at cost determined using the first-in-first-out method.
            iii. Raw materials              Stated at cost determined using weighted-average method.
            iv.  Goods in process           Stated at cost determined using weighted-average method.
            v.   Supplies                    Stated at cost determined using the last-purchase-cost method.

2.    Depreciation and Amortization

      (1)Tangible Fixed Assets:            Depreciated using the declining-balance method.

                                           Note that the amount of depreciation for buildings (excluding
                                           fixtures to buildings) acquired by the company on and after April
                                           1, 1998, is estimated using the straight-line method.
                                           The useful lives of main properties are as follows:
                                             Buildings and structures..................5-50 years
                                             Machinery and equipment.....................10 years
                                             Vehicles and delivery equipment........... 4-6 years
                                             Tools/furniture and furnishings...........2-10 years
      (2)Intangible Fixed Assets:          Amortized using the straight-line method.
                                           Note that software costs for internal use are amortized using the
                                           straight-line method over the internally estimated useful lives (5
                                           years).
      (3)Long-term Prepaid Expenses:       Amortized using the straight-line method.

3.    Accounting Standards for Providing Allowances

      (1) Allowance for Doubtful accounts: To prepare for possible losses caused by irrecoverable money claims
                                           at the fiscal year-end, the company provides allowances as follows:
                                           For general credit claims, an allowance is provided for the amount
                                           calculated based on past credit-loss experience. For specifically
                                           doubtful credit claims, an allowance is provided for the estimated
                                           uncollectible amount based on the collectibility assessment for
                                           each such credit claim.

      (2)  Allowance for Bonuses:          Allowance for employee bonuses is provided in the provision for
                                           payment of bonuses to employees, and in the amount of estimated
                                           bonuses, which are attributable to the current interim consolidated
                                           fiscal year.

      (3) Allowance for Employees'         Allowance for employee retirement benefits is provided in the
          Retirement Benefits:             provision for payment of retirement benefits to employees, and in
                                           the amount deemed to have been accrued at the end of the current
                                           interim consolidated fiscal year, based on the projected retirement
                                           benefits obligation and the fair value of plan assets at this
                                           fiscal year-end.

                                           The unrecognized net actuarial difference is amortized using the
                                           straight-line method over a number of years (usually 10 years)
                                           within an employee's average remaining employment period,
                                           commencing from the next fiscal year in which they arise (stated as
                                           either income or expenses in the statement of income).

      (4) Allowance for Directors' and     An allowance is provided for the amount the company would have to
          Auditors' Retirement Benefits:   pay at the end of the interim fiscal year, which is estimated in
                                           accordance with internal regulations. The system for paying
                                           retirement benefits to directors and auditors, however, was
                                           abolished in June 2004, so the outstanding balance of this
                                           allowance represents an estimated amount for payment to the
                                           directors and auditors currently holding offices under the previous
                                           system.

4.    Accounting of Lease Transactions

      Excluding those in which the ownership of the leased properties is transferred to the lessee, finance lease
      transactions are accounted for in the same manner as operating leases.

5.    Hedge Accounting

      (1)  Hedge Accounting Method:       Currency swap transactions meet the requirement of allocation
                                          treatment and are accounted for accordingly.

      (2) Hedging Instruments and Hedged  Hedging Instrument                Hedged Items
          Items:                          Currency swap transaction         Foreign currency denominated
                                                                            money claims

      (3)    Hedging Policy:              The company uses currency-related hedge accounting for the purpose
                                          of fixing cash flows related to the collection of principal and
                                          interest on loans.

      (4) Assessment Method for the       The company omits assessment of the effectiveness of hedges for
          Effectiveness of Hedges:        currency swap transactions, since the significant terms and
                                          conditions for such transactions and for hedged assets are
                                          identical, and assumed beforehand to offset exchange rate risks and
                                          cash flow fluctuations from the time the hedging is initiated.

6.    Other Significant Items to Prepare for Interim Financial Statements

      (1)Consumption Taxes:                Consumption taxes are excluded from the transaction amounts. Net
                                           amount of suspense paid for consumption taxes on purchases and
                                           suspense received for consumption taxes on sales is included under
                                           'Others' for current liabilities.

      (2)Treatment of Reserves:            Taxes payable and corporate tax adjustment for the current interim
                                           period are calculated under the premise that entries of provisions
                                           and reversals will be made to reserve accounts for special
                                           depreciation in accordance with profit appropriation scheduled for
                                           the current fiscal year.

Additional Information

      Since the company has used a size-based corporate tax system since the beginning of the current interim fiscal
      period, sales and general administrative expenses increased by Y152 million, and operating income, ordinary
      income, and net income before taxes each decreased by Y152 million.

Notes

NON-CONSOLIDATED BALANCE SHEETS                                                                       (Millions of Yen)

                                                       As of Sept 30, 2003   As of Sept 30,  2004   As of March 31, 2004
------------------------------------------------------------------------------------------------------------------------
1. Accumulated depreciation on tangible fixed assets               60,067                  63,048                 61,636
2. Advanced depreciation by national subsidy                          150                     150                    150
3. Liabilities on guarantees and others
       Liabilities on guarantees                                    1,911                   1,735                  1,891
   Committed guarantees and others                                    200                       -                      -

------------------------------------------------------------------------------------------------------------------------

NON-Consolidated statements of income                                                                  (Millions of Yen)

                                                         FY2003 (Interim)         FY2004 (Interim)                FY2004
------------------------------------------------------------------------------------------------------------------------
1.  Depreciation of fixed assets
    Tangible assets                                                 1,719                    1,783                 3,693
    Intangible assets                                                 264                      262                   526
------------------------------------------------------------------------------------------------------------------------
LEASE TRANSACTIONS:
Details are omitted because they are disclosed by EDINET.

SECURITIES:
Marketable stocks of subsidiaries and affiliated companies.

As of September 30, 2003                                                                              (Millions of Yen)
                                                                  Book value          Market Value           Difference
-----------------------------------------------------------------------------------------------------------------------
Stocks of affiliated companies                                         1,374                 2,284                  909

As of September 30, 2003                                                                              (Millions of Yen)
                                                                  Book value          Market Value           Difference
-----------------------------------------------------------------------------------------------------------------------
Stocks of affiliated companies                                        1,770                  3,490                1,719

As of March 31, 2004                                                                                  (Millions of Yen)
                                                                  Book value          Market Value           Difference
-----------------------------------------------------------------------------------------------------------------------
Stocks of affiliated companies                                        1,374                  2,776                1,402



                      This information is provided by RNS
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