To Our Shareholders and Investors

I'd like to begin by expressing my gratitude for your continued support of IBIDEN Co., Ltd. and the IBIDEN Group.

Performance Review

In the electronics business, we achieved an increase in sales in the PKG business, thanks to favorable demand for our PC items and the launch of stable mass production as scheduled from the cutting-edge IC package substrate manufacturing equipment (first-phase investment) at the Ogaki Central Plant. In the MLB business, sales of module substrates were strong. Affected by the U.S.-China conflict, however, there was a decline in the sales of some products for smartphones for Chinese customers, leading to a decrease in sales for the MLB business. On the whole, the electronics business marked increases both in sales and income from the previous consolidated fiscal year.
In the ceramics business, we accomplished increases in both sales and operating income in the DPF business, the main field of our ceramics business, as a result of our efforts to improve the productivity of high-performance products and to expand sales of our products for large commercial vehicles, whose demand is expanding due to the tightening of exhaust gas regulations. The AFP business performed steadily, thanks to the recovery of the automobile market, centered on the Chinese market, during and after the summer. As a result, the ceramics business as a whole returned to the black, with lower sales and higher income compared to the previous consolidated fiscal year.
In other business fields, we enjoyed steady orders related to power plant projects in the construction sector. However, the spread of COVID-19 postponed some private construction projects and decreased the number of completed large-scale construction projects, leading to a decrease in sales. However, due to the effects of a wide variety of cost improvements that we implemented, our operating income increased.

Future Forecast

Regarding the electronics business, it is expected that there will be an increase in demand for even higher performance IC package substrates, as we experienced last fiscal year, because of the growth of the PC market due to the worldwide spread of telework and remote learning, expansion of the data center market due to the development of DX, and the need for in-vehicle image analysis. We will strive to expand our market share in the cutting-edge fields in which we have always demonstrated our strengths, by launching mass-production as scheduled, using large-scale investment equipment for cutting-edge IC package substrates in the second phase, following the first phase. In addition, from the perspective of maintaining a flexible response to the market and making effective use of our management resources, we will continue to apply the concept "selection and concentration" for improving our production system and production items.
Regarding the ceramics business, it is expected that the DPF business, our main field in the ceramics business, will experience a temporary decline in the production of automobiles due to continuation of the trend of diesel-free engines and EVs in the passenger car market, plus a global shortage of semiconductors. However, we will strive to expand our sales of products for large commercial vehicles, for which demand is expected to grow against the backdrop of tightening emission regulations mainly in emerging countries. By doing so, we will establish a system enabling us to ensure medium- to long-term business continuity and stable profits. In terms of the AFP business, we started mass-production at IBIDEN Fine Ceramics (Suzhou) Co.,Ltd. in the first half of FY 2021 as scheduled. By steadily capturing demand in growing markets, we will strive to place the entire ceramic business on a path toward stable growth.
Furthermore, we will aim to establish the position of other business fields as a reliable "third revenue source" after the electronics business and the ceramics business. To do so, we will strive to expand our business fields by taking advantage of the unique, competitive products of our domestic group companies, and also invigorate our operations in the power business.

Initiatives Aimed at Sustainable Growth

To expand our business fields, we will aggressively invest management resources in growing markets. For development of new products, our basic approach is to combine our existing elemental technologies, but we will also cooperate with outside entities as needed, thereby striving to develop products quickly. Regarding our response to climate change, we regard it as one of our priority management issues. We will strive to strike the best balance between business growth and responding to climate change by setting a FY 2030 target toward realizing virtually zero greenhouse gas emissions by 2050.

At the IBIDEN Group, we will continue to pursue ESG (Environment, Society, Governance) management toward earning further trust from all stakeholders. We would like to ask our shareholders for their continued support.

President & CEO
Takeshi Aoki