Regarding the automotive industry, one of the Group's most important markets, in addition to the impact of the COVID-19 pandemic, production continued to decline among automotive manufacturers because of the global semiconductor shortages. They also suffered from the difficulty in the supply and hike in material prices, as well as the ongoing effect of increased transportation costs due to economic revitalization. In the second half, however, the number of cars produced increased compared to the previous year in Japan as the situation gradually improved.

Under such market demand, the PIOLAX group securely provided for our business partners' needs. At the same time, we have been continuously promoting global sales expansion efforts for non-Japanese in addition to Japanese business partners. Meanwhile, although our production was impacted by the COVID-19 pandemic and the reduction in production activity at our business partners caused by semiconductor shortages, the decline was offset by the depreciation of the yen. As a result, our net sales were 58,422 million yen, an increase of 3,278 million yen (up 5.9%) compared to the previous fiscal year.

In terms of profits, we promoted further streamlining of operations, however, we saw a sharp rise in material prices, logistic costs, energy and other expenses. As such, our operating income was 3,949 million yen, a decrease of 1,267 million yen (down 24.3%) compared to the previous fiscal year, and our ordinary income was 4,868 million yen, a decrease of 908 million yen (down 15.7%) versus the previous fiscal year. Our current net income attributable to owners of PIOLAX Inc. was 3,375 million yen, a decrease of 848 million yen (down 20.1%) from the previous fiscal year.

Regarding the future economic outlook, while the Japanese government and Bank of Japan are expected to continue their economic policies and monetary easing, due to surging energy prices and inflation since the previous year, sluggish growth in consumer spending and a slowdown in capital investment have been observed. The market is expected to remain even more uncertain.

In the automotive industry, like last year, the supply issue of semiconductors and raw materials, and disruption of distribution systems continued, we believe that competition will become even more intense in emerging markets such as ASEAN with the rise of local automobile manufacturers.

Against this backdrop, although the economic climate remains uncertain due to factors such as the geopolitical issue of Russia, semiconductor supply concerns and price hikes for raw materials and energy, the PIOLAX Group will promote company-wide streamlining activities while promoting global sales expansion targeting domestic and overseas car manufacturers. As a result of this, we expect consolidated net sales of 63,000 million yen, an operating income of 4,000 million yen, an ordinary income of 4,600 million yen and a current net income attributable to owners of PIOLAX Inc. of 3,100 million yen.
It should be noted that the figures in this report were based on an exchange rate of US$1 = ¥130.