First, I would like to express my sincere appreciation for your support of GS Yuasa.
I will present the Company's operating performance for the first six months of the fiscal year ending March 31, 2020.
In the fiscal year ended March 31, 2020, the global economy entered a slowdown. While the employment environment in the United States remained favorable, the Chinese economy slowed under the weight of US-China trade frictions and the European economy remained clouded by uncertainties related to Brexit. In addition, the spread of the novel coronavirus across the globe since the start of 2020 has caused a global economic slowdown. The Japanese economy meanwhile remained firm during the first half of the fiscal year, with domestic demand supported by improved employment and income environments. In the second half, however, a string of natural disasters and the consumption tax hike led to the start of a slowdown that has been exacerbated by the impact of the novel coronavirus.
In this economic environment, the GS Yuasa Group’s consolidated net sales for the fiscal year totaled ¥395,553 million, ¥17,535 million or 4.2% less than in the previous fiscal year. The main reasons for the decline in Group sales were the automotive batteries business’s lowering of product prices to reflect the fall in the price of lead and the negative impact from yen appreciation. Operating income came to ¥21,676 million(¥23,935 million before goodwill amortization), a decrease of ¥977 million, or 4.3% from the previous fiscal year’s result. Despite solid sales of stationary lead-acid batteries and power supply systems as well lower prices for lead, operating income declined owing to profit deterioration in the automotive lithium-ion batteries business. Ordinary income also declined, falling ¥1,618 million year on year, or 6.5%, to ¥23,109 million, reflecting the decrease in operating income and a decline in equity in earnings of equity-method affiliates. Despite the declines in operating and ordinary income, profit attributable to owners of parent increased to ¥13,674 million (¥15,925 million before goodwill amortization), a year-on-year gain of ¥149 million, or 1.1%, primarily due to a change to income tax adjustments.
I sincerely hope we will be able to count on the continued support and encouragement of our shareholders as we rise to meet the challenges ahead.