N I P P O N S E I K I

I n t e g r a t e d R e p o r t

2 0 2 3

Philosophy and Policies

Management Philosophy System

Philosophy

Corporate

Culture

Vision

Code of Conduct

Midterm Policy / Management Goal /

Policy・Target by Segment

Social Issues for Complying Stakeholder's Expectation

Management Philosophy

To contribute to the prosperity of society

by providing high-value products and

services from our customer' point of view.

Corporate Culture

  • Essentials, Reality, Simplicity and Speed」

Create a corporate culture that embodies the aspects of

"Essentials, Reality, Simplicity and Speed" and become a "strong and robust company"

01 Nippon Seiki Integrated Report

Vision

Facing the future

Challenge & Change

for 2030

The Nippon Seiki Group aims to be a total solution company that provides

safety, security and excitement to people around the world through technology.

Technology

Product

Technology to develop products that meets high-grade functional requirements by

Development

understanding customer requirements and market needs, combining hardware design

Technology

technology (mechanical/electronics hardware/optical design, etc.) and software technology

(system/program design, etc.), and coordinating with customers.

Technologies which enable the global supply of high-quality,low-cost products by possessing

Evolution of core

manufacturing technology for resin-based parts (compounding, molding, printing, painting,

technologies

etc.), mounting and assembly technology for printed circuit board artwork and electronic

components, and design/manufacturing technology for production equipment and molds, and

utilizing these technologies at the Group's production bases.

Innovation of

Technology to collect, process, and share information by function (management information,

Lifestyle

sales/design/engineering/manufacturing/purchasing/quality information, etc.), as well as

technology to accumulate and analyze information and reflect it in business strategies.

Total Solution

Innovation of

To provide safety, security, and excitement to society by continuously evolving functions that

Perceptual Assist

pick up information that people cannot directly perceive and transmit it in a timely and

appropriate manner through their five senses.

Evolution of core

Continue to create innovation through evolution, provide technologies that meet market

demands, and co-create solutions to the problems faced by the customers by evolving and

technologies

combining the three technologies owned by the Group and the individual technologies that

make up the three technologies.

Innovation of

To provide new products and services that replace taken-for-granted habits and behaviors,

Lifestyle

thereby creating more time in people's lives and enriching their lives.

Sustain and Improve Quality

Awareness Change

1.

Focus on cost improvement

4.

Have the spirit to lead the organization

2.

Critical of the current situation, challenge reform

5.

Change your perspective and ideas, and take on challenges

3.

Speed up judgment and execution

6.

Systematize and improve organizational strength

Nippon Seiki Integrated Report 02

Safe, Secure and Inspiring

Everyone

03 Nippon Seiki Integrated Report

C O N T E N T S

SECTION

SECTION

SECTION

SECTION

SECTION

01

02

03

04

05

Overview of Nippon Seiki Group

05 Nippon Seiki Group History

  1. Overview of the Nippon Seiki Group
  1. Financial and Non-Financial Highlights

Nippon Seiki Group's Value Creation Process

11 Message from the President

  1. Nippon Seiki Group Sustainability Policy
  1. Value Creation Process
  1. Materiality
  1. Business of Nippon Seiki Group

ESG Initiatives

  1. ESG Initiatives
  1. Environment
  1. Social Activities
  1. Corporate governance
  1. Dialogue with Outside Directors

Financial Statements

53 Financial Statements

Company data

  1. Board of Directors
  2. Integrated Report Review

Forward-Looking Statements

The data and future forecasts in this report are based on information available as of the date of publication of this report, and may be affected by various factors. Actual results may differ materially from forecasts. Therefore, we ask that you refrain from relying entirely on these forward-looking statements. In addition, we are based on the new situation, the incidents of the Shoho (General News) and so on.

We are not responsible for updating these future predictions.

Nippon Seiki Integrated Report 04

Nippon Seiki Group History

1940's～50's

1960's

1970's

1980's

Society

Nippon Seiki

1945

1973

●Remarkable Economic Growth in Japan

●Oil Crisis

1945

1972

●Nippon Seiki Foundation

●In California, U.S.A Established

N.S. International, Inc.

1946

●Nippon Seiki Co., Ltd. Establishment

1955

●Head

office and factory relocated to Nishi-Shinmachi

(present: Jooka), Nagaoka City, Niigata Prefecture

1981

●Takami Plant completed

1986

  • Listed on the Second Section of the Tokyo
    Stock Exchange
  • In Ohio, USA
    Established New Sabina
    Industries Inc.

1987

  • In Worstershire, United Kingdom
    Established UK-NSI.

［1948］Daihatsu Auto Tricycle

［1965］Honda CB450

［1958］Honda SUPER CUB C100

［1976］Honda ACCORD

［1982］Mazda CAPELLA

Circumstance and Corporate Value Change

(million yen)

18,000

16,000

14,000

12,000

10,000

8,000

6,000

4,000

2,000

0 -2,000-4,000-6,000

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

05 Nippon Seiki Integrated Report

1990's

2000's

2010's

2020's

1997

2011

●Asian Currency Shock

●The Great Earthquake

1991

2008

2020

●Collapse of a Bubble Economy in Japan

●Lehman Shock

in East Japan

●COVID-19 Pandemic

1990

2001

2011

●Established R&D Center in

●Established PT.Indonesia Nippon Seiki

●Established Wuhan Nissei Display System Co., Ltd.

Nagaoka City, Niigata Prefecture

in Banden, Indonesia

in Wuhan, China

1995

2006

2019

●Established Shanghai Nissei

●Established NS

Technical Center

●Established Nippon Seiki

Display System Co., Ltd.

in Nagaoka City,

Niigata Prefecture

Poland Sp. z o.o. in Lodz, Poland

in Shanghai, China

●Established Thai Nippon Seiki Co., Ltd.

2007

in the province of Chonburi, Thailand

●Established

Vietnam Nippon Seiki Co., Ltd.

2022

in Hanoi Vietnam

●Established NS India

2002

Design & Trading Private Ltd.

2012

●Established Nippon Seiki Do Brasil Ltda.

in Haryana, India

in Amazonas, Brasil

●Tokyo Technical Center opened

●Kyoei Engineering in Agano City,

●Established Nippon Seiki（Europe）B.V.

●Established NS Instruments

Niigata Prefecture became wholly

in Amsterdam, the Netherlands

India Private Ltd. in Southern India

owned subsidiary of Nippon Seiki

2008

●Established Nippon Seiki De Mexico S.A. De C.V.

［1988］McLaren Honda F-1 MP4/4

in Nuevo León, Mexico

［1999］Chevrolet CORVETTE

［2007］BMW X5

［2015］Audi Q7

［2018］Mercedes-Benz GLE

Profit attributable to owners of the parent company（Left Side）

Market capitalization（Right Side）

(million yen)

180,000

160,000

140,000

120,000

100,000

80,000

60,000

40,000

20,000

0

-20,000

-40,000

-60,000

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023 (FYE)

0 1

Overview of Nippon Seiki Group

02

Nippon Seiki Group's Value Creation Process

03

ESG Initiatives

04

Financial Statements

05

Company data

Nippon Seiki Integrated Report 06

Nippon Seiki Group Overview [FYE March 2023]

Sales & Number of Employees by Region (Sales:truncation)

Europe

Japan

Sales (Outside)

Sales (Outside)

(8.2%)

(37.3%)

22.7 Billion Yen

Consolidated Sales

102.9 Billion Yen

Number of Employees (Inside)

275.7

Billion Yen

Number of Employees (Inside)

658 (4.8%)

4,440 (32.6%)

Operating Profit

2.8

Billion Yen

Americas

Number of Employees

Asia

13,624

Sales (Outside)

Sales (Outside)

(26.7%)

(27.7%)

73.7 Billion Yen

76.3 Billion Yen

Number of Employees (Inside)

Number of Employees (Inside)

2,256 (16.6%)

6,270 (46.0%)

Nippon Seiki Group Network

Europe

U.K.

Netherlands Poland

Japan

Japan

U.S.A.

China

Taiwan

Americas

Mexico

India

Vietnam

Thailand

Asia

Indonesia

Brasil

07 Nippon Seiki Integrated Report

Sales by Business Segment (Sales:truncation)

Car Sales

Other

(8.5%)

(2.5%)

23.4 Billion Yen

7.0 Billion Yen

Display Business

(0.2%)

0.6 Billion Yen

Resin Compound

Business

(3.2%)

8.7 Billion Yen

Consumer Component

Automotive Component

Business

Business

19.4 Billion Yen

216.4 Billion Yen

(7.0%)

（78.5%)

Summary of Financial Results

0 1

Overview of Nippon Seiki Group

02

Nippon Seiki Group's Value Creation Process

03

ESG Initiatives

Fiscal year ended March 2023 Financial Results

The economic environment surrounding our group during the fiscal year ended March 31, 2023 saw progress in the relaxation of various restrictions caused by the novel coronavirus in countries around the world. Although there have been signs of economic recovery, the outlook remains uncertain due to factors such as global inflation and high resource prices, geopolitical risks such as Russia's invasion of Ukraine and conflict between the United States and China, monetary tightening policies in each country, and exchange rate fluctuations.

In our mainstay automotive parts business, sales have recovered to 2019 levels due to the reduction in the impact of the new coronavirus. Production plans were changed due to a shortage of parts such as semiconductors, and material and logistics costs soared. However, we have endeavored to secure profits by appropriately reflecting increased costs in selling prices and by reducing logistics costs by reducing air transport of products and parts.

Revenue for the current fiscal year was 275,776 million yen (up 23.3% year on year), operating income was 2,840 million yen (operating loss of 4,276 million yen in the previous fiscal year), and net income was 1,380 million yen. million yen (compared to a loss attributable to owners of the parent

company of 5,180 million yen in the previous fiscal year).

In the automotive parts business, sales revenue of 216,483 million yen (up 26.7% from the previous fiscal year) and operating income of 1,179 million yen (compared to an operating loss of 5,857 million yen in the previous fiscal year) due to an increase in automobile instruments, motorcycle instru- ments, etc. was. In the consumer parts business, sales of air conditioning and housing equipment controllers increased, resulting in revenue of 19,419 million yen (up 56.0% from the previous fiscal year) and operating income of 1,349 million yen (up 876.7% from the previous fiscal year). In the resin compound business, sales of resin materials increased, resulting in revenue of 8,727 million yen (up 1.2% from the previous year), but operating income was 158 million yen (down 62.3% from the previous year). In the display business, sales of LCD products decreased, resulting in revenue of 678 million yen (down 58.0% from the previous fiscal year) and operating loss of 1,296 million yen (compared to an operating loss of 95 million yen in the previous fiscal year).

In the automobile sales business, sales of new cars increased, resulting in revenue of 23,402 million yen (up 4.3% year on year) and operating income of 1,090 million yen (up 13.9% year on year). In other areas, sales revenue was 7.064 million yen (down 8.1% from the previous year) due to a

decrease in information systems services, etc., but operating income was 588 million yen (up 13.1% from the previous year).

Overview of the

Financial Situation

Assets at the end of the current consolidated fiscal year amounted to 355,954 million yen, an increase of 26,401 million yen compared to the end of the previous consolidated fiscal year, due to an increase in inventories, despite a decrease in other financial assets. Liabilities increased by 14,825 million yen compared to the end of the previous fiscal year to 149,505 million yen, due to an increase in bonds and loans payable, trade payables, and other payables due to securing safety stock.

Capital increased by 11,575 million yen compared to the end of the previous fiscal year to 206,449 million yen due to increases in other capital components.

Inventories have increased due to the recent shortage of electronic components, customers securing safety stocks to maintain their production lines, and requests from component suppliers for long-term contracts. Currently, the shortage of electronic parts is beginning to ease, and we are working to reduce inventory by reviewing our management methods and aim for optimal inventory levels.

04

Financial Statements

05

Company data

Nippon Seiki Integrated Report 08

Financial and Non-Financial Highlights for the Year Ended March 31, 2023

Financial

Revenue from sales

(100 million yen) [Consolidated]

(100 million yen)

3,000

2,632

2,757

2,463

2,500

2,236

2,169

2,000

1,500

1,000

500

0

2018

2019

2020

2021

2022

(year)

Operating Profit / Operating Profit Ratio

(100 million yen) (%) [Consolidated]

(100 million yen)

(%)

150

5.4

6

100

3.1

4

142

50

1.8

2

76

1.0

39

28

0

0

-42

-50

-1.9

-2

2018

2019

2020

2021

2022

(year)

Net Income Attributable to Owners of the Parent Company / Return on Equity

(100 million yen) / (%) [Consolidated]

(100 million yen)

(%)

120

115

12

90

9

6.6

60

6

30

13

3

5

0

-3

0.7

0

-0.2

0.3

-30

-2.8

-3

-60

-51

-6

2018

2019

2020

2021

2022

(year)

Operating Profit

Net Income Attributable to Owners of the

Operating Profit Ratio

Parent Company

Return on Equity

Current assets / Non-current assets

(100 million yen) [Consolidated]

(100 million yen)

4,000

3,295

3,559

3,076

3,151

2,969

3,000

1,109

1,076

963

1,014

1,091

2,000

1,000

2,113

1,955

2,060

2,218

2,449

0

2018

2019

2020

2021

2022

(year)

Capital Adequacy Ratio

(%) [Consolidated]

(%)

58.5

60

56.8

56.9

56.5

56.1

40

20

0

2018

2019

2020

2021

2022

(year)

R&D Expenses

(100 million yen) [Consolidated]

(100 million yen)

50

40

37

39

35

30

29

31

20

10

0

2018

2019

2020

2021

2022

(year)

Current assets Non-current assets

Capital Investment / Depreciation

(100 million yen) [Consolidated]

(100 million yen)

150

139

132

123

125

100

98

97 94

103

93

82

83

75

50

25

0

2018

2019

2020

2021

2022

(year)

Capital Investment

Depreciation

Net Income per Share

(yen) [Consolidated]

(yen)

250

200

202

150

100

50

22

8

0

-6

-50

-100

-85

2018

2019

2020

2021

2022

(year)

Dividends per Share

(yen) [Consolidated]

(yen)

50

45

40

40

40

40

40

30

20

10

0

2018

2019

2020

2021

2022

(year)

09 Nippon Seiki Integrated Report

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Nippon Seiki Co. Ltd. published this content on 01 December 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 01 December 2023 06:05:32 UTC.