To Understand SHINKO

Business Summary

Fiscal Year Ended March 31, 2024 Consolidated Sales & Profit

The Current State of the Shinko Group

In the semiconductor industry, while the market environment during the fiscal year 2023 has shown partial improvement due to increased demand in semiconductors for AI, a severe business environment continued with prolonged market downturn due to the continuing stagnation in the PC and server markets, a drop in demand for smartphones caused by longer replacement cycles, the impact of US Government export restrictions on semiconductors to China, inventory adjustments and other factors.
The Shinko Group focused on productivity improvements and cost reductions and on winning orders to secure income, despite the semiconductor market struggling to recover due to significant impact from the stagnation in the PC and smartphone markets and from prolonged inventory adjustments. Furthermore, regarding capital investments for these growing markets that we have continuously pursued, we reviewed part of the plan due to the current market situation. However, we continued to allocate management resources in anticipation of medium- to long-term expansion in the semiconductor market and increasing demand for our products in the future. For our flip-chip type packages, which meet the need for semiconductors with higher functionality and speed as well as power saving, we promoted efforts to enhance our production systems, including the construction of the building of the Chikuma Plant (Chikuma City, Nagano Prefecture) as a new production site. Furthermore, a new capital investment plan for the Chikuma Plant regarding next-generation flip-chip type packages for cutting-edge semiconductors has been certified as a “Supply Security Plan” based on the Economic Security Promotion Act, and subsidies have been granted. For plastic BGA substrates, we started the construction of a new building for the Arai Plant (Myoko City, Niigata Prefecture) to increase the production capacity.

 

Net Sales

Net sales of flip-chip type packages decreased largely due to delayed recovery in demand for PCs and servers, and other factors. Net sales of ceramic electrostatic chucks decreased significantly due to export restrictions on semiconductors and the deterioration of the market. So, overall sales conditions were affected by the market downdraft. As a result, net sales were 209,972 million yen (down 26.7% year on year).

Ordinary Profit

Profits were significantly affected by the drop in sales. Ordinary profit was 27,257 million yen (down 65.4% year on year).

Profit Attributable to Owners of Parent

Profit attributable to the owners of the parent was 18,609 million yen (down 65.8% year on year).