“Constantly on the cutting edge” President Takayuki Tokuma
We have always strived to remain constantly at the cutting edge ever since the Yokowo Group was first established. Drawing on our core competencies in the rapidly evolving communications and electronic component industry, as a specialist in antennas, fine connectors, microwaves and advanced devices, we have continued to harness our uniquely advanced technical capabilities to offer revolutionary products in each of our core markets, in the automotive, semiconductor testing systems, mobile communication terminals and advanced medical device sectors.
We have set out the following Basic Management Policy in an effort to further improve the Group's corporate value.
Basic Management Policy
- We are dedicated to quality and aim to establish Yokowo as a quality brand by offering the highest quality and eliminating environmentally harmful substances.
- As a technology-based enterprise, we aim to continually upgrade and refine our antenna, microwave, ceramic and micro precision processing technologies and actively introduce new technologies to enable us to offer products with improved added value and provide customers with the wide-ranging product capabilities and applied technologies they need.
- We aim to accelerate taking our business to new levels by pursuing innovation strongly in three key areas: product innovation (to enhance business and product structures), process innovation (to enhance business processes and systems) and personnel innovation (to enhance human resources), and by promoting management innovation (to enhance management and business operation) with a view to future growth in addition.
- We aim to establish a business framework that is able to respond to the global paradigm shift, the severe business environment and rapid changes in the competitive environment by creating a multi-layered business structure in industry segments, customers, technologies and supply chains.
Medium-term Management Targets
Business model reforms to achieve high quality, full-scale growth and the Minimum 8 [The Minimum 8: Secure a sales growth rate, a minimum operating profit margin, and a return on equity of 8%]
Medium-term Management Strategy
The paradigm shift in the world economy continues, and shows no signs of slowing down. Likewise, we are seeing the ongoing advancement of commoditization and the transition to borderless markets. Commoditization refers to reduction or loss of first movers’ advantage following the rapid diffusion of new technologies and products. The transition to borderless markets indicates the integration of technologies and products from different areas to create new markets.
In the midst of these circumstances, we are working to implement the four forms of innovation specified in the Basic Management Policy in an effort to continually enhance our corporate value. These are innovation in products, innovation in processes innovation in personnel, and innovation in management.
For the fiscal year under review (ended March 31, 2020), consolidated net sales reached a record high for the sixth consecutive term, and income also hit a record high on all levels. As a result, we achieved all three targets in the aforementioned Minimum 8, which are the medium-term management targets.
In the vehicle, semiconductor testing systems, mobile communication terminal and advanced medical device sectors, each of the Group's target markets is fundamentally a growth market with prospects for medium- to long-term expansion, given the boost from the development and implementation of 5G, autonomous vehicles and other technologies and products that are creating a new social infrastructure. To gain and establish a dominant position in these core markets, we will strongly boost the four innovation measures described above and seek to attain stable growth for the entire company as well as a strong, high-profitability structure by shifting the business model.
However, the impact of the COVID-19 coronavirus, which has been spreading globally since the end of 2019, is extremely profound, and it is difficult to foresee the situation for the next six months in the Group's target markets. Based on the recognition that the global business environment and competitive environment will enter a violently changing phase, the Group will formulate a new medium-term management plan, including the fundamental review of business strategies, for the 83rd fiscal year (ending March 31, 2021) to the 85th fiscal year (ending March 31, 2023) with July 2020 as a goal.
Issues to be Addressed
While we marked record highs in all items, from net sales to profit attributable to owners of parent, and achieved all three targets in the Minimum 8 in the fiscal year under review, as mentioned above, results were mixed by segment. In the 83rd fiscal year (ending March 31, 2021), the business environment is extremely uncertain, given the direct and indirect impact of the coronavirus. Under these circumstances, we will focus on the following.
Vehicle communication equipment segment
- Enhancement of the development of the Chinese plant
- Further expansion of the Vietnam Plan and the reinforcement of its production technology system
- Introduction and expansion of automated assembly lines and automatic inspection systems at the production base
- Consideration of the third production base to strengthen cost competitiveness
Circuit testing connector segment
- Full-fledged expansion of the turnkey business in the field of semiconductor front-end testing
- Investments to strengthen the production capacity, investments in the construction of automated assembly lines and introduction of automatic inspection systems at the plants in Japan and Malaysia for efficiency enhancement and streamlining purposes
Personal communication equipment segment
Fine connector business :
- Capitalizing on new demand at an accelerating pace by bringing to market custom-type connectors in line with specific needs for differentiated products in the market and by expanding the standard product lineup
Medical device business :
- Increase in production equipment
- Launch of mass production of new assembly products as planned
New business domains
- Systems business: Evolution of business models in preparation for the future age of CASE
In addition, we are aware of the need to fulfill our corporate social responsibility (CSR) at a higher level as a globally operating firm. We will therefore continue to take comprehensive CSR actions that address a wide range of issues, including the environment, compliance, corporate governance, the protection of human rights, and the protection of information assets.
Our Group will strive to consistently achieve the Minimum 8 by overcoming this extremely difficult situation caused by the coronavirus, combining all our efforts as an organization. We hope that we can count on the continued support and guidance of our shareholders.