press release

happy new year.

Since the beginning of last year, 2020, the COVID-19 pandemic has been raging, and there is still no end in sight. We would like to express our heartfelt condolences to those who have been infected with the COVID-19 pandemic, and we sincerely pray for a speedy recovery. We also express our heartfelt respect to the medical and care workers who are contributing to the health and welfare of the nation on the front lines. We hope that this situation will end as soon as possible.

On July 31st of last year, we made an external announcement regarding the progress of safety confirmations and recurrence prevention measures regarding the quality inappropriate cases. Since the external announcement at the end of August 2018, we have mostly completed our response to customers, and we have received an understanding that there are no problems with the safety and functionality of most of the affected products. Going forward, we will learn from our past mistakes and continue to thoroughly implement various recurrence prevention measures, aiming to foster organization culture in which quality inappropriate acts will never occur again.

In the first half of the fiscal year, the Group's operating profit margin was 3.0% and profit was 8.9 billion yen due to the effects of business structural reforms in FY19, various activities to reduce incurred costs, and the capture of stay-at-home demand for digital devices, although sales decreased YOY (Year Over Year) due to the suspension of production by automobile manufacturers due to the spread of the new coronavirus infection.
In the second half of the year, although the impact of the spread of the new coronavirus infection is expected to continue and domestic demand for energy business is expected to decrease. business Effects of structural reforms and strategy products by the Information and Communications Sub-Company and Fujikura of America Spider Web Ribbon® (SWR®)/Wrapping Tube Cable® (WTC®) expects full-year operating income to be 11.0 billion yen, reflecting the development of FTTx in Europe and the U.S. and the expansion of demand for hyperscale data center on a global scale, resulting in an increase of sales.

In response to the deterioration in business performance in fiscal 2019, the Company decided that continuing with the Medium-Term Management Plan, which ended in FY2020, could lead to a further deterioration in the earnings structure, and formulated the "100-Day Plan" to abandon the Medium-Term Management Plan and transform into a sustainable business organization. Under the 100-Day Plan, we will review our business portfolio and business strategy in the four areas of energy, telecommunications, FPC, and Wire harness, and we will also promote initiatives such as corporate structural reform, fixed cost reduction and asset sales, and management reform.
In addition, we will promote the "Optical Cable business Expansion" project as a field of "concentration" of "selection and concentration". Armed with our strengths in the SWR®/WTC® business, we will strengthen the business of optical cables as a driver of our next growth.

business In the growth phase after the revitalization phase, opportunities to contribute to society in the areas in which we excel await. We are beginning to see businesses in fields where we can leverage our strengths, such as the further expansion of business optical solutions centered on information and communication technology, the creation of business using technologies related to electronic components in the medical field, and the business of peripheral products such as FPCs and connectors that support sensor systems for autonomous driving.

I will take the lead in revitalizing business with unshakable resolve, but of course this cannot be accomplished without the efforts of each and every Fujikura employee. First, please reexamine your current work and think about what work you need to do now to revitalize business. In the current situation where the company must make major changes, I believe that a change in behavior on the part of each of you will be a great force. If each Fujikura employee of Fujikura Group takes even a half step forward, it will be an enormous force. Let's each take a half step forward without fearing change.