During the consolidated fiscal term under review (April 1, 2020 to March 31, 2021), whereas the global economy slowed down markedly at the outset of the fiscal year in the wake of the spread of COVID-19, the Chinese economy quickly rebounded; overall, there was a tendency toward moderate recovery in general. In the electronics market where the Tamura Group operates, the automotive and information and telecommunications sectors got back on the recovery track early, and the demand for household appliances to be used while working or staying at home remained strong. In fall, the industrial machinery market began recovering rapidly. Meanwhile, COVID-19 showed no signs of abating, and new destabilizing factors manifested themselves, such as the global shortage of semiconductor chips, the soaring prices of raw materials including copper, and the political unrest in Myanmar.
Under these circumstances, the Group’s business offices and factories followed the guidelines on the prevention of COVID-19 drawn up by central and local governments of respective countries, and took various measures, including teleworking and staggered working hours, in a bid to make efforts at preventing the spread of COVID-19 and securing business continuity compatible. Further, it strove to cut costs by managing expenses thoroughly and identifying critical capital spending.
As a result, the Group’s consolidated sales in the term under review fell 7.2% from a year earlier to 73.906 billion yen; operating income was 1.969 billion yen, down 14.0% year-on-year; and ordinary income fell 5.0% over the year-ago level to 2.384 billion yen thanks in part to employment adjustment subsidies that it posted.
The Group registered an extraordinary loss of 704 million yen, which was incurred by the relocation of the Chinese subsidiary, the payment of special retirement allowances due to the revised personnel system, and loss on sales and retirement of fixed assets as the Sakado Factory was rebuilt. Meanwhile, it also posted an extraordinary gain of 588 million yen thanks in part to investment incentives related to the construction of a factory for manufacturing reactors for eco-friendly vehicles and a gain on sales of investment securities.
On top of these, in light of future uncertainties in the business environment, which are characterized by the rising prices of raw materials and the escalating conflict between China and the U.S., and after carefully weighing the realizability of deferred tax assets, the Group decided to write down deferred tax assets totaling 705 million yen. As a result, it posted a current net income attributable to stockholders of the parent company of 542 million yen, down 47.0% from a year earlier.