Message from the President
I would like to take this opportunity to extend my best wishes and to thank everyone for the exceptional support given to us.
Semiconductors are key components that act like the brains in PCs, smartphones, automobiles with built-in electronics, and applications related to the Internet of Things (IoT), as well as devices used in the environmental, energy, and healthcare fields.
Continued growth is expected in the semiconductor industry over the medium to long term, as semiconductor usage continues to broaden in the electronic products that underpin and enrich people’s lives by making them more convenient, comfortable, safe, and reliable.
On the other hand, technological innovations, such as those that enable higher integration and faster speeds, combined with ever-changing market needs, have spurred the necessity to establish development and production systems that are flexible and inexpensive. Competition is thus expected to intensify even further on a global scale.
Faced with these industry conditions, the Shinko Group will establish a more solid business foundation by seeking to develop and enhance elemental technology centered on semiconductor packaging. We will focus on pushing business development in growth markets and strive to reinforce our competitiveness by improving productivity and reliability.
In addition, the practical application of the “SHINKO Way,” our corporate philosophy and policies, will not only establish us as a necessary company for the market but also expand our business, so that we can continue to be a necessary company for society.
In September 2016, we celebrate the Company’s 70th anniversary. This is a result of the support we have received from our esteemed shareholders, to whom I express our sincere appreciation.
During the fiscal year under review, the Shinko Group focused on new product development and capital investment in fields where market expansion is anticipated. The Group also strengthened initiatives to boost productivity and expanded further into areas with high-value-added products.
These efforts achieved sales growth in ceramic electro static chucks, IC assemblies and lead frames for smartphones and automobiles. Sales of our flipchip type packages decreased for PCs, but increased for servers. As a result, consolidated net sales for the period under review rose 0.4% year on year to 143,453 million yen. The increase in sales of high-valued-added products and weakness in the yen up through the third quarter contributed to earnings. Consolidated recurring income was 10,135 million yen (up 12.9% year on year). Profit attributable to owners of parent declined 46.0% year on year, to 3,476 million yen, partly reflecting an impairment loss on fixed assets.
With regard to the future of the semiconductor industry, demand is expected to rise on the back of growth in information and communications technology (ICT)-related markets, and semiconductor usage is expected to expand further, including in the automobile, environmental, energy, and healthcare fields. On the other hand, demand for PCs is projected to decline and the deceleration of smartphone growth is predicted to grow pronounced, as seen for example in fluctuations in demand with the shift to low-priced goods and transitions between product generations. Overall, a harsh business environment is forecast to continue.
Given this environment, the Shinko Group will strive to step up sales promotion by concentrating investment of management resources in markets that are expected to grow in the future, including servers, automotive electronics, and semiconductor manufacturing equipment, based on the Group’s semiconductor packaging technology and product portfolio. Additionally, in fields where the need for high-performance semiconductors is forecast to increase, such as the IoT, which is expected to undergo rapid market expansion, we will focus on capturing new demand by enhancing our marketing and development capabilities and expanding our technology domains, to commercialize new products. We will also attempt to increase productivity and reliability of products for PCs and smartphones, and forcefully advance the development and launch of next-generation products, among other efforts, to strengthen competitiveness and ensure earnings.
To achieve “Progress without Limits,” the Shinko Group is determined to create a strong company structure that can respond immediately to changes in the market and environmental conditions by continually blazing new trails in manufacturing, technology, and services in the fiercely competitive semiconductor market.
President and Representative Director