Flooding in Thailand also took a toll on the third quarter performance of the Rotary Components Business. Total net sales were 19.3 billion yen, down a whopping 24.8% from the previous quarter. The operating deficit widened beyond what it was in the previous quarter to reach 1.6 billion yen while the operating margin was negative 8.3%, 6.2 percentage points below what it was in the previous quarter.
Our HDD spindle motor business was hit hard by the flooding which took a major toll on our Rojana and Navanakorn parts plants. We also had a negative impact from the flooding on our information motor business including fan motors where we were unable to procure driver IC chips temporarily.
While other motor sales were also affected by the floods and the slowdown in global economy, precision motor sales increased because a number of automobile models which utilize our products increased. In many motors, profitability deteriorated due to lower sales although profits increased for precision motors and DC brushless motors for which office automation product applications had been recovering from the Tohoku Earthquake.
Negative impacts from high rare-earth material prices were loosened compared to before because of price declines, our effort to adjust product prices and design changes to lower production costs.
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