Message from the President

Message from the President_sp

Message from the President

Based on our semiconductor packaging technologies,
we strive to achieve progress without limits,
always starting with customer needs.

President and Representative Director
Masami Fujita

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 vital components that act like the brains in automobiles, in which technological development is accelerating, such as with autonomous driving and electric vehicles (EVs), and applications related to the Internet of Things (IoT)—which is envisioned to expand rapidly—as well as devices used in the medical, and other associated fields that support people’s health. The semiconductor market is anticipated to keep growing, as semiconductor usage continues to spread. Moreover, big data, artificial intelligence (AI), and other advanced technologies, supported by the practical implementation of the next-generation mobile communications standard (5G), are changing the structure of the economy and society. They have the potential to create innovation on a different order of magnitude than ever before. It is expected that the progress of semiconductors will continue as a key technology for achieving this potential.
The Shinko Group is committed to developing and providing to markets highly competitive products, based on our interconnection technology that brings the marvelous features and benefits of semiconductor devices into people’s lives. We will strive to provide products and services with high value for customers, and to support their success and maintain their trust, by accurately grasping customers’ needs and ensuring a high level of quality, cost, and delivery performance. Through these initiatives, we will pursue our own development and growth.
Through practice of the “SHINKO Way,” which sets out the Shinko Group’s corporate philosophy and policies, we are committed to running our business so that we remain a company that is needed by society, while continually boosting our corporate value and contributing to the sound development of society.

Business Results for the Fiscal Year Ended March 31, 2019

During the fiscal year under review, the Shinko Group focused on investing management resources into growth markets, including next-generation flip-chip type packages suited to nano-fabrication and high-density semiconductors. In the second half of the fiscal year, the Group faced headwinds overall, including the impact of inventory adjustments, and so pursued a course of proactive sales promotions. As a result, sales of ceramic electro static chucks for semiconductor manufacturing equipment increased, demand for heat spreaders for servers grew, while lead frames and IC assemblies were affected by inventory adjustments during the second half of the fiscal year. Sales of flip-chip type packages decreased due to sluggish orders in the first half of the fiscal year. As a result of these factors, consolidated net sales for the period under review decreased 3.3% year on year to 142,277 million yen. Nevertheless, the growth in sales from high-value-added products and the posting of foreign exchange gains resulted in consolidated recurring income of 7,649 million yen (up 33.5% year on year). Profit attributable to owners of parent decreased 31.1% year on year to 2,526 million yen due to the posting of an extraordinary loss stemming from a loss associated with the move to a retirement benefit scheme with the introduction of a risk-sharing pension plan and an impairment loss on fixed assets.

Outlook

Regarding the future of the semiconductor industry, demand for semiconductors is anticipated to expand further in the IoT- and AI-related markets, where greater utilization is expected in the future, supported by the implementation of the next-generation mobile communications standard (5G) and in the automotive market where technological development is accelerating, mainly in the areas of autonomous driving and EVs. On the other hand, competition is forecast to intensify worldwide, with the need to establish development and production systems that can swiftly and flexibly meet increasingly sophisticated market needs.
Given this environment, the Shinko Group will concentrate on tying market growth and expansion to our own growth by continuing to focus the investment of management resources on markets with high growth potential. For example, we plan to make capital investments to reinforce production systems and increase production at our Takaoka Plant in Nakano City, Nagano Prefecture, among other plants. This will be for next-generation flip-chip type packages, demand for which is expected to grow in the future for high-performance semiconductors, including for servers. We will also push ahead with the establishment of mass production systems for next-generation plastic BGA substrates that can handle even higher-speeds and larger-capacity semiconductor memory, as well as for ceramic electro static chucks for semiconductor manufacturing equipment, for which demand is anticipated to increase over the medium- to long-term. Additionally, we will further strengthen our business foundation by ensuring a high level of quality, cost, and delivery performance. To that end, we will continually work on the development and establishment of production systems for highly competitive products, based on a variety of semiconductor packaging technologies we have cultivated thus far.
To achieve “Progress without Limits,” the Shinko Group will provide products and services that offer solid value to customers, always starting with customer needs, in semiconductor markets that are expected to continue growing.

June 2019
Masami Fujita
President and Representative Director