We will contribute to people and society from a long-term perspective and achieve sustainable growth even in uncertain times.
Progress of the Medium-Term Management Plan
Heading into the Final Year of the Medium-Term Management Plan
During the Medium-Term Management Plan launched in the fiscal year ended March 31, 2021, we have encountered a challenging environment, but we have made steadfast efforts to solve issues faced by customers and society by leveraging AIDA's technological capabilities. In the plan's final year, we will ramp up the capacities of production facilities in Japan and overseas in order to respond to higher demand for electric vehicles. In addition, we will revamp the workplace environment of our employees-our greatest assets-and strive to put the finishing touches on various measures that emphasize investing in human resources.
We have been implementing initiatives to address each of the plan's three core strategies: (1) Technological inno- vation, (2) Strengthening our business infrastructure, and
(3) Improving profitability. The initiatives are outlined below.
Initiatives That Focus on Our Three Core Strategies
• Developing Optimized Technologies for Press Lines
produce EV drive motors. In the fiscal year ended March 31, 2022, we completed the development of optimized technologies for these press lines, including peripheral equipment. In the fiscal year ending March 31, 2023, we have been working to sell a second forming line which incorporates even more improvements.
We will push ahead with the development of improved methodologies for forming lightweight materials, such as high-tensile steel, aluminum, and carbon fiber, by improving the capacities of our servo motors and enhancing our hydraulic controls.
We are also developing a "digital twin" function that will visualize the operating status of press machines on a computer in real time by importing their operational data (temperatures, amperage values, pressure, etc.) The DSF- N2-4000A Direct Servo Former, which is equipped with this functionality, was awarded the Nikkan Kogyo Shimbun's 64th (2021) Ten Greatest Innovations Prize. Going forward, the Group will explore ways to develop its subscription business by expanding sales of these sorts of functions.
We have started to see signs of a recovery from the impact of the COVID-19 pandemic on economic activity, but the spread of new variants has still not ended and it is impossible to foresee the future course of the impact of new disruptions caused by Russia's invasion of Ukraine. Although the management environment remains highly uncertain, we will work to address universal issues in society as we meet the challenges of a new era, with the aim of achieving sustainable growth and improved corporate value. It is precisely because the times are so tumultuous that we will endeavor to solve ESG issues and improve our corporate value based on our Management Vision: "As a leading company, AIDA will contribute to society by supporting efforts to protect the environment, reduce energy consumption, and develop new technologies."
Review of the Fiscal Year Ended March 31, 2022
Substantial Recovery in Orders Supported by Demand for Electric Vehicles
During the fiscal year ended March 31, 2022, though economic activity was recovering from the impact of the COVID-19 pandemic, the global economy continued to face tumultuous conditions, due to factors such as logistics disruptions, shortages of semiconductors and electronic parts, surging prices for energy, parts, and materials, and the conflict between Russia and Ukraine. In the metal- forming machinery industry, orders on a worldwide basis shifted from a downward trend to a growth trend. The Japan Forming Machinery Association reported that overall
order intake for press machines increased 60.8% year on year to ¥143.2 billion in the fiscal year under review.
In the fiscal year ended March 31, 2022, the Group continued to post steady growth in orders for high-speed presses supported by demand for electric vehicles, and orders for general-purpose presses also made a recovery. The Group received a large order in the U.S. for a large servo tandem line for electric vehicles. Due partly to this order, consolidated order intake increased substantially by 48.7% year on year to ¥78.3 billion and the order backlog was up 40.5% year on year to ¥55.1 billion. Net sales also recovered, rising 7.5% year on year to ¥62.4 billion.
On the earnings front, the gross profit margin declined due to factors that included soaring raw material costs, the postponement of sales due to supply shortages for electronic parts, and higher R&D expenditures. Consequently, operating income decreased 32.7% to ¥2.5 billion and ordinary income decreased 35.1% to ¥2.4 billion. Net income attributable to owners of parent decreased 31.9% to ¥896 million, due to the posting of an impairment loss at a plant in China in addition to the factors described above.
The Group has already completed capital expenditures to address the growth in orders for high-speed presses. These capital expenditures include the addition of a paint booth, the installation of a 60-ton overhead crane, and the introduction of large 5-axismulti-functional machining centers for the Tsukui Plant. In the fall of 2022, the Group also plans to start operation of a machining plant for the internal components of high-speed presses to further strengthen its mass production systems.
Against the backdrop of the electrification of automobiles, demand has been growing for high-speed presses to
Net Sales by Business Segment in "The Evolved AIDA PLAN 523" Medium-Term Management Plan (Fiscal Year Ended March 2022)
• Mid-size and large servo presses
• Mid-size and large presses
In the summer of 2022, we introduced a new personnel system, which we had been preparing since the fiscal year ended March 31, 2022. The new system revamps our previous personnel evaluation system and remuneration structure, both of which strongly reflected a traditional seniority system, and updates it to a system that improves organizational management and contributes to human resource development. Efforts will be made to firmly entrench the new system within our organization.
With the introduction of a new engineering system that we upgraded in the fiscal year ended March 31, 2022, we will streamline our production processes and make them smarter, including linking our engineering system with our machining center system and introducing an IoT-based system for monitoring the status of our operations.
strengthening our service business and related areas and improving our product mix. By doing so, we aim to achieve profit growth in the fiscal year ending March 31, 2023.
Amid intensifying price competition in our press business, we will reallocate management resources to strengthen our service (maintenance/modernization) and automation/ FA businesses, which deliver higher-value-added content.
In our press business, in anticipation of growing demand for EVs and other next-generation vehicles, we will strive to improve our press machine product mix according to market needs, while putting emphasis on high-speed and precision presses, which result in higher added value.
Initiatives Focused on Priority Strategies by Business Segment
In line with these core strategies, we have established priority strategies for each of our business segments-our press business, our automation/FA business and our service (maintenance/modernization) business-and are advancing the following initiatives.
Strengthening Our Press Offerings for Next-Generation Vehicles and Enhancing Our Product Mix
We have completed layout changes at the Tsukui Plant to increase production of the high-speed presses used to produce drive motors for EVs and other electric vehicles, and we will strive to improve production efficiencies by transitioning some Sagami Plant resources to high-speed press production. In addition, we have expanded our supply capabilities for the Asian region through new equipment that came online at our Malaysia Plant in the second half of the fiscal year ended March 31, 2022. In the fiscal year ending March 31, 2023, we will provide training to manufacturing and service staff at our sites in Europe and the U.S. and work to localize high-speed press manufacturing and installation-related tasks that had previously been covered by our headquarters plant in Japan.
Leveraging Control Technologies to Create Value- Added Content
• Further Enhancements to Press-to-Press Transfer Feeders
Our D-MATpress-to-press transfer feeders have garnered
high praise for their highly flexible conveyance capabilities
through the usage of image sensors. These feeders have
In Europe and the U.S., local specialized automation equipment manufacturers are very competitive, and AIDA automation product sales to European and U.S. customers have been lagging. Going forward, we will work on enhancing the production capacities of our overseas sites in Europe and the U.S. to bolster the in-house manufacturing of automation equipment and to expand AIDA's participation in supplying automation systems in these regions.
(3) Our Service (Maintenance/Modernization) Business
Efforts" Focused on Preventive Maintenance and
• Overhaul and Modernization Work on Existing
Peripheral equipment for high-speed press systems devel-
oped in the fiscal year ended March 31, 2022 will be intro-
duced to the market, and efforts will be made to expand
sales of these products. In addition, the servo motor-
equipped press machines that were developed in-house in
2002 will soon be reaching an age where they will need to
be overhauled. For this reason, we will boost sales efforts
towards customers worldwide. Together with these efforts,
we will leverage IoT and DX to visualize the timing of com-
ponent replacements, etc. as part of our efforts to improve
Outline of the Medium-Term Management Plan "The Evolved AIDA PLAN 523" (Fiscal Years Ending March 2021- 2023)
As a leading company, AIDA will contribute to society by supporting efforts to protect the environment,
reduce energy consumption, and develop new technologies.
Improve corporate value through value creation and societal contributions
to achieve sustainable growth together with our stakeholders
been successively incorporated in the large servo tandem
lines orders AIDA has received in recent years. We have
also been receiving more and more inquiries for moderniz-
ing transfer feeders. We will focus on capturing such mod-
ernization needs along with striving to further improve the
performance of our transfer feeders.
preventive maintenance measures and discover new needs.
Performance Forecasts in "The Evolved AIDA PLAN 523" Medium-Term Management Plan
(Billions of yen) Net Sales/Operating Income
80.0 ■ Press Business ■ Factory Automation/FA Business ■ Service (Maintenance/Modernization) Business Net Sales (Left)
* Rounded to the nearest ¥100 million. * 2023 forecast numbers are the numbers announced in May 2022.
Business Outlook and Shareholder Return Policy for the Fiscal Year Ending March 31, 2023
We will develop products that fully demonstrate AIDA's
Examples of Other ESG Measures
The economy has been returning to normal after the COVID-19 pandemic and demand in automotive-related industries has been recovering. Accordingly, for the fiscal year ending March 31, 2023, we forecast consolidated net sales of ¥72.0 billion. Based on the increase in net sales and the improved gross profit margin, the operating income forecast is ¥5.5 billion. We forecast ordinary income of ¥5.7 billion and net income attributable to owners of parent of ¥4.0 billion. Overall, these forecasts represent year-on-year increases in both revenue and earnings.
In the fiscal year under review, while we posted a decrease in earnings, we believe that there were no major changes in overall business trends. Therefore, with respect to shareholder returns, in the fiscal year ended March 31, 2022, we paid a cash dividend of ¥25 per share, for a consolidated dividend payout ratio of 166.5%, as initially planned in accordance with the basic policy of our Medium-Term Management Plan. In the fiscal year ending March 31, 2023, based on forecasted profit improvements we plan to pay a dividend of ¥30 per share, for a consolidated dividend payout ratio of 44.8%.
Companies are being strongly urged to contribute to a sustainable society through ESG, SDGs, and other means. We are implementing the initiatives listed below to specifi-
"Manufacturing DNA," thereby enabling our press
machines to help reduce the environmental impact of cus-
tomers' production sites and of society as a whole. → page 16
In April 2022, we disclosed our Carbon-Neutral Initiative Policy, with the aim of becoming carbon-neutral by 2050. Approximately 20% of the electric power used at our domestic business sites comes from in-house power gen- eration, which helps to lower CO2 emissions. In October 2021, we took this a step further by switching to carbon -neutral LNG* for in-house power generation. This initiative is expected to reduce the roughly 7,400 tons of annual CO2 emissions from our domestic business sites by approximately 2,000 tons. Moreover, we are advancing initiatives to foster renewable energy sources, including the start of research and development of peripheral equipment for wind power generation that leverages AIDA's existing technological capabilities. Looking ahead, as we rebuild our aging headquarters plant, we will also use this construction as an opportunity to look at transitioning our domestic business sites to renewable energy sources and achieving zero emissions.
Our Corporate Philosophy states that "AIDA will grow as a forming systems builder and continue its contribution to
Reducing Environmental Impact through Efficient Energy Use
At our headquarters plant in Sagamihara City, we have introduced a gas co-generation system (GCS) and Genelink (a gas absorption water chiller-heater that utilizes hot waste water). The introduction of this equipment has greatly reduced our total energy costs, by allowing us to utilize hot waste water from power generation for factory and office air conditioning. Solar power generation equipment is also installed alongside this equipment. If there is an emergency, this equipment will make electric power available for a limited time. In 2020, we were certified as a "Business that Promotes the Local Supply and Local Consumption of Energy in Kanagawa Prefecture" in recognition of our efforts to use renewable energy sources to achieve in-house power generation and for internal power consumption.
AIDA was awarded the 2021 "MF Technology Excellence Award" by the Japan Forming Machinery Association in recognition of the "Manufacturing of Highly Difficult Knurled Parts Through a Multi-Stage Press Forging Process" using the
high forming precision of our NS2-D Series Digital Servo Former. Because of the high degree of difficulty in forming the required shape, these parts had been previously manufactured using a metal powder sintering process. However, using our press machine to form the parts has (1) improved productivity, (2) improved material yield, and (3) achieved higher strength. The forming technologies and the resource conservation leveraged by this process have earned high praise.
* The photo shows the current model: DSF-N2 Series Direct Servo Former.
cally address investments in human resources and environmental protection.
(1) Fostering Human Resources and Diversity
We will widely recruit diverse human resources regardless of gender, nationality, age, disabilities or other factors.
In addition, under the new personnel system introduced in July 2022, we have reorganized complex hierarchies in our organization and have clearly defined the roles and abilities that are expected for employees at each job level. These changes have made it easier to reflect the expertise and abilities of employees in personnel evalua- tions. Together with this, we will strive to further bolster our in-house education and training system.
people and community." Under this Corporate Philosophy, we are determined to achieve sustainable growth by working to address societal issues from a long-term perspec- tive. We kindly ask for the continued support of all our stakeholders.
Registration as a Sagamihara SDGs Partner
We registered as a Sagamihara SDGs Partner in March 2022. Under this program, we are working closely with the community to
solve local community issues, with a view to achieving SDGs.
Opening the Tsukui Plant Sports Field to the Public
As part of our efforts to contribute to the local commu- nity, the sports field on the grounds of our Tsukui Plant has been opened to the public on non-working days free of charge. The sports field can be used for a variety of sports, such as the local community's Little League baseball and rugby teams.
Sponsorship Agreement with S.C. SAGAMIHARA
In April 2022, we became an official sponsor of S.C. SAGAMIHARA, Sagamihara City's J-League soccer club. Through our sponsorship of S.C. SAGAMIHARA we will strive to improve our corporate branding along with helping to energize the community and promote sports as a means of supporting the development of a healthy society.
Registration as a Sagamihara City Disaster
In May 2020, we registered as a Sagamihara City Disaster Management Cooperative Business. We will make our headquarters' cafeteria, commissaries, and restrooms available for use as an evacuation center in case of a disaster. This cooperation will allow us to help bolster the community's disaster management capabilities.
Aida Engineering Ltd. published this content on 07 October 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 07 October 2022 03:21:06 UTC.