I offer my sincere gratitude to our shareholders for their continued support.
Although the Japanese economy continued on a moderate recovery trajectory during the consolidated
fiscal year under review, in addition to the impact of U.S. trade policies, there were growing concerns about
the acceleration of inflation triggered by rising long-term interest rates in the government bond market and
higher import prices due to the weak yen weakness, because of the current administration's expansionary
fiscal policy and continued monetary easing since its inauguration in October 2025. Subsequently, the
Japanese government took steps to correct the weak yen through foreign exchange intervention, and the
outlook remains uncertain. In the global economy too, in addition to concerns about a downturn due to
political turmoil triggered by regime change in Latin America, economic stagnation in China and Europe, and
trends in national trade policies, the Middle East destabilized rapidly with the outbreak of large-scale
conflict between the U.S./Israel and Iran in February 2026 raising concerns about a blockade of the Strait of
Hormuz among other problems. This led to the global spread of risk, including tight supplies of oil and other
raw materials, and is having a significant impact on Japan's economy, which is highly dependent on imports.
Despite this environment, orders from major customers in the automotive sector, the group's core
business, are currently progressing steadily.
Although sales to major European customers declined due to a swing back towards plug-in hybrid
vehicles (PHVs) because of uncertainty surrounding EV demand, sales to major Japanese customers
remained steady, resulting in consolidated net sales of 100,202 million yen (4.9% increase over the previous
fiscal year). In terms of profits, while production plant operating rates remained low through the first half of
the fiscal year due to measures to strengthen our quality control system, preparation for the full-scale
launch of our new plant in Thailand, and the rebuilding of our production system, the second half saw an
increase in high-value-added products and the fruition of the various improvement measures implemented
to date, and although profitability improved significantly in the most recent fourth quarter as a result,
operating profit ended at 2,788 million yen (26.8% decrease from the previous fiscal year).
With regard to non-operating profit, although the yen first trended downwards against the Thai baht, from the beginning of 2026 to the end of the fiscal year, the
trend reversed from decline to appreciation. Also, as the yen shifted to a downward trend against the euro and the U.S. dollar from an upward trend in the previous
period, the foreign exchange impact on the group's foreign currency-denominated receivables and payables decreased compared to the same period of the previous
year, resulting in foreign exchange profit of 1,522 million yen. As a result, ordinary profit ended at 4,136 million yen (25.3% decrease from the previous fiscal year).
Under extraordinary profit, we recorded a gain on the sale of investment securities of 1,891 million yen in association with the sale of investment securities
implemented to increase the efficiency of our asset portfolio and strengthen our financial position, and under extraordinary losses, we recorded a provision for
environmental measures of 499 million yen as we anticipate costs related to environmental measures at the company's premises. As a result, net income attributable
to owners of the parent company was 4,026 million yen (6.2% increase over the previous fiscal year).
We understand that the business environment surrounding the group will continue to be uncertain. In such an environment, the group revised its Medium-term
Management Plan on May 19, 2026. Based on this plan, we will work on sustainable growth and the improvement of corporate value.
I ask for the continued understanding and support of our shareholders.
June 2026
CMK Corporation
President : Yoshiaki Ishizaka