Message from the CEO

To Our Shareholders

 We are pleased to report our business results for the interim period of the 113th term (April 1, 2018 to September 30, 2018). I would like to express my sincere gratitude for your unwavering support again during this term.

The NOK Group has been implementing a business management plan with which it hopes to become a strong business group with high profitability, under its management basis of producing low-cost original products―backed by technology―which are useful to society, and selling them at reasonable prices all over the world.

In the first half of the fiscal year, the Group’s net sales amounted to 342,029 million yen, down 4.3% year on year. The Group recorded operating income of 14,040 million yen, down 30.1% year on year; ordinary income of 18,036 million yen, down 32.2% year on year; and profit attributable to owners of the parent of 9,650 million yen, down 40.6% year on year.

During the first six months of the current consolidated fiscal year, the business environment surrounding the Group in Japan remained on a moderate recovery track due to continued increases in capital expenditures, despite the impact of natural disasters, such as the floods in West Japan. Looking overseas, the U.S. economy remained robust. In China, signs of a slowdown emerged as a result of the effects of the trade dispute with the United States.

The domestic business environment for the Group is expected to continue its modest recovery during and after the third quarter. However, the future of the global economy is still unpredictable, with the slowdown of growth in the Chinese economy due in part to the effects of the trade dispute with the United States and other uncertainties.

With regard to the interim dividend for this six-month period, we have decided to set it at 25 yen per share.

We are earnest in our determination to endeavor to meet the expectations of our shareholders.

We ask for your understanding of the current business climate and our management direction, as well as our commitment. The NOK Group greatly appreciates your continued support and guidance.

December 2018

Chairman of the Board  Masato Tsuru

President  Kiyoshi Doi