To shareholders and investors

I would like to offer my deepest gratitude for the understanding and overwhelming support our valued shareholders extend to the Torex Group on a regular basis.

I am pleased to announce that following approval at the 29th Ordinary General Meeting of Shareholders, we have established a new management structure with Koji Shibamiya as Representative Director and Chairman, and Takeshi Kimura as Representative Director and President. We will make every effort to further develop our business while forging ahead together with our employees, and appreciate your continued guidance and encouragement.

During our 29th fiscal period (fiscal year ended March 31, 2024), the effects of reactionary declines from COVID-driven special demand and the slowdown of the Chinese economy spread across the electronics market in general, with inventory adjustments for semiconductors and electronic components occurring in various fields, including automotive, industrial, communication and consumer equipment. Working in this environment, the Torex Group experienced significant declines in net sales both in the former Torex Group (“Torex”), which develops and markets analog power supply ICs, and at Phenitec Semiconductor (“Phenitec”), which provides contract manufacturing of discrete semiconductors. In response to the deteriorating order environment, Torex recorded a 2,330 million-yen monetary impact including product inventory write-downs as a loss, and also posted an approximately 1,700 million yen impairment loss that including fixed assets for production lines at external investees.

As a result, in our consolidated results for the 29th fiscal year, net sales amounted to 25,751 million yen (down 19.4% year on year), with an operating loss of 1,778 million yen (down from an operating profit of 3,976 million yen in the previous year), ordinary loss of 2,452 million yen (down from an ordinary profit of 3,981 million yen in the previous year) and loss attributable to owners of parent was 4,297 million yen (down from a profit attributable to owners of parent of 2,179 million yen).

The market at present is showing signs that the inventory adjustment phase will continue for some time, and we project that demand will not recover until the second half of the 30th fiscal period (fiscal year ending March 31, 2025) or later. However, the products provided by the Torex Group, including analog power supply ICs and power devices, are essential for our daily lives and the development of industry, and over the medium to long terms we expect notable increases in demand. In anticipation of the market recovering and expanding again, the Torex Group will continue to develop new products and improve its mass production system, aiming to achieve sustainable growth by aggressively capturing the growth of the market.

Takeshi Kimura
Representative Director, President
June 2024