SPK Corporation

Business Details

Sells automotive replacement parts and accessories to regional parts wholesalers, car accessory shops, and other outlets, supported by stable demand for replacement parts driven by the maintained number of vehicles owned and the lengthening average vehicle age in Japan. The segment offers core products such as PB products, batteries, suspension products, wipers, and air conditioner filters. Note that from the current consolidated fiscal year, the division overseeing Del Auto Co., Ltd. was transferred to the Industrial Machinery Sales Headquarters, so prior-period comparisons are based on restated figures. Segment profit is calculated on an ordinary income basis.

Recent Overview

Achieved 4.6% year-on-year sales growth driven by steady sales of core products

Full-year net sales for FY2026 (ending March 2026) were ¥32,076 million (up 4.6% year on year), and segment profit was ¥1,520 million (up 2.6% year on year). Core products such as PB products, batteries, suspension products, wipers, and air conditioner filters performed well, with steady sales to major customers. On the other hand, some domestic and overseas customers of domestic consolidated group companies struggled, leading to a decline. SG&A expenses increased 13.5% year on year due to expanded investment in human capital and continued elevated logistics costs. The segment continues to pursue operational efficiency through logistics reform and system upgrades, as well as value chain optimization.

Key Products

Growth Drivers

• Stable demand for replacement parts driven by the maintained number of vehicles owned and lengthening average vehicle age
• Steady sales of core products such as PB products, batteries, suspension products, wipers, and air conditioner filters
• Promotion of operational efficiency through logistics reform and system upgrades
• Value chain optimization through strengthened collaboration with business partners, other headquarters, and group companies
• Maintaining and expanding the customer base through a wide product lineup and responsive service system

Risks

• Long-term changes in replacement parts demand due to the progress of electrification (EV/HV) and CASE
• Pressure on profitability from labor shortages and persistently high logistics and other costs
• Sales struggles at some customers of domestic consolidated group companies
• Costs of responding to changes in the maintenance environment associated with automotive IT adoption and autonomous driving
• Impact on business performance from heightened geopolitical risk (e.g., rising raw material and procurement costs)

Business Details

Sells replacement parts produced by domestic automotive parts manufacturers to more than 250 customers in over 80 countries worldwide through local importers. The company has local subsidiaries in Singapore, Malaysia, Thailand, China, the Netherlands, and the United States, and is expanding triangular trade. Against a backdrop of increasing vehicle ownership, overseas demand for replacement parts is on an expanding trend, and this segment functions as a key growth driver for the SPK Group. Segment profit is calculated on an ordinary income basis.

Recent Overview

Steady through Q3, but Q4 exports to the Middle East fell sharply, narrowing the sales growth rate

Following the U.S.-Israel attack on Iran that occurred at the end of February 2026, exports to the Middle East region planned for March slowed, resulting in a difficult fourth quarter. However, solid sales through the third quarter provided support, and full-year net sales reached ¥27,979 million, up 10.4% year on year. In North America, turmoil continued due to U.S. tariff policy, but the local subsidiary worked to expand sales of new products and exceeded the prior year's results. Sales in Asia and Latin America expanded steadily, aided by the weak yen environment. On the other hand, segment profit decreased to ¥979 million from ¥1,106 million in the prior period.

Key Products

Growth Drivers

• Continued expansion in demand for replacement parts driven by the global increase in vehicle ownership and lengthening average vehicle age
• Sales contribution from expanded transactions in new products in the Asia and Latin America regions
• Strengthened relationships with existing suppliers in North America and Latin America and rollout of various measures
• Consolidated revenue contribution from expanded sales of new products by overseas local subsidiaries (particularly the U.S. subsidiary)
• Expansion of triangular trade and deepening of the global network
• Maintaining export competitiveness aided by the weak yen environment

Risks

• Weak consumer sentiment and sluggish maintenance demand among customers due to uncertainty over U.S. tariff policy (particularly affecting the U.S. subsidiary)
• Loss of export opportunities due to geopolitical risk in the Middle East region (e.g., the situation in Iran)
• Impact on the global replacement parts market from rising crude oil prices stemming from the situation in Iran
• Impact on procurement costs and sales from sharp exchange rate fluctuations (both yen depreciation and appreciation)
• Geopolitical risk and sudden changes in circumstances in the Latin America region (e.g., Venezuela)
• Uncertainty over the global economic outlook due to monetary and trade policy trends in major countries
• Risk of extended delivery times from suppliers

Business Details

The Industrial Machinery Sales Headquarters supplies a wide range of products, including electrical components, mechanical components, and various lamps and filters, as assembly parts to major manufacturers producing construction machinery, agricultural machinery, forklifts, and other industrial vehicles. From the current consolidated fiscal year, Del Auto Co., Ltd. was transferred from the Domestic Sales Headquarters, changing the segment composition. While demand for forklift parts remained sluggish in the North American and European markets, demand for construction and agricultural machinery parts trended favorably.

Recent Overview

North American and European forklift parts sales failed to recover, and full-year sales declined 0.7% year on year

Full-year net sales for FY2026 (ending March 2026) were ¥7,988 million (down 0.7% year on year), and segment profit was ¥570 million (versus ¥586 million in the prior period). While construction and agricultural machinery-related sales trended favorably in the fourth quarter, sales of forklift parts to North America, Europe, and the domestic market did not recover, resulting in a year-on-year decline for the full year. Conditions varied significantly by industry. Going forward, demand in the North American and European markets is expected to gradually recover, and the segment plans to strengthen the development of new business areas and proposal-based sales.

Key Products

Growth Drivers

• Outlook for a gradual recovery in demand in the North American and European markets
• Continued development of new markets, new products, and new customers to complement existing business
• Strengthened proposals and development of electrification, connectivity, and automation/labor-saving products
• Strengthened cost competitiveness through an increased ratio of global procurement
• Expanded business foundation through the segment transfer of Del Auto Co., Ltd.
• Improved efficiency and competitiveness through sophistication of organizational capabilities and business processes

Risks

• Continued production cuts by major customers due to the impact of tariff policy and uncertain economic outlook in the North American market
• Risk of delayed demand recovery due to economic downturn in the European market
• Risk of prolonged sluggishness in demand for forklift parts
• Risk that business performance is directly affected by fluctuations in customers' production plans due to high dependence on major customers
• Foreign exchange risk associated with expanded global procurement
• Risk of changes in product composition due to progress in electrification and automation in the construction, agricultural, and industrial vehicle industries
• Impact on the supply chain from geopolitical risks such as the situation in Iran

Business Details

Mainly handles customized parts, and also operates the Automaker Tie-up Business, an original brand business, a motorcycle business, and an e-Sports business. Supplies PB, NB, and OEM products to automakers, customization brand manufacturers, automotive parts wholesalers, automotive parts mass retailers, car dealers, and specialty stores. The segment is expanding its products and sales channels through the acquisition of exclusive import rights and sole agency rights, the launch of new businesses, and the incorporation of BLITZ Co., Ltd. (Group Company) into the group. In March 2026, it also announced the sale of a complete vehicle for the first time in 104 years, continuing its challenge into new business areas.

Recent Overview

Full contribution from BLITZ collaboration drove a 54.4% increase in net sales, with segment profit expanding more than fourfold

In FY2026 (ending March 2026), the CUSPA Sales Headquarters achieved net sales of ¥7,202 million (up 54.4% year on year) and segment profit of ¥415 million (a significant improvement from ¥99 million in the prior period). The main factor was the full-year contribution of the large-scale acquisition of BLITZ Co., Ltd. carried out in the prior consolidated fiscal year. Even amid headwinds from rising raw material costs and higher import prices due to the weak yen, profitability improved significantly through price revisions and a review of the shipping fee structure for in-house brand products, selective concentration of development and advertising expenses, expanded collaboration with new automakers, and strengthening of the simulator-related business. In addition, in March 2026, the segment announced the sale of a complete vehicle for the first time in 104 years, beginning its expansion into new business areas.

Key Products

Growth Drivers

• Expanded sales scale and full consolidated revenue contribution from the incorporation of BLITZ Co., Ltd. into the group
• Improved profitability through price revisions and review of the shipping fee structure for in-house brand products
• Expanded collaboration with new automakers and strengthening of the simulator-related business
• Aggressive expansion into new business areas, including the announcement of the first complete vehicle sale in 104 years
• Expanded product lineup through the acquisition of exclusive import rights and sole agency rights
• Improved investment efficiency through selective concentration of development and advertising expenses

Risks

• Rising import procurement costs due to the weakening yen (persistently high raw material prices and logistics costs)
• Risk of raw material price and exchange rate fluctuations due to continued geopolitical risk (high import procurement ratio increases cost pressure in a weak-yen environment)
• Impact on sales of customized products for new vehicles due to automakers halting new vehicle orders, etc.
• Goodwill amortization burden related to integration and collaboration with the acquired BLITZ (balance of ¥577 million and amortization of ¥97 million at the end of FY2026 (ending March 2026))
• Risk of fluctuations in demand in the customization market (economic trends and changes in consumer preferences)
• Business risk in new business areas such as complete vehicle sales