Based on the existing business, we are building a foundation as a parts manufacturer, will push forward the development of new businesses and new products.
President & Chief Executive Officer
We are extremely grateful to everyone of shareholders for the continuous good office.
We show the 55th stage (2016 FY02) financial report, and tell the future business development. Please read.
Situation of the customer industries, despite maintaining a continued strong automotive following the previous fiscal year, energy-related such as plants and the prime mover was no great shakes by crude oil weaker, housing-related also moved to sluggish without the growth of new construction-related as expected.
Consolidated results of our company in such cases, but was expected to decline due to prior investments in the new field from the beginning, from the fact that the sales plan had become not achieved in each segment, overall sales were lower than in the previous fiscal year, also it became a more than expected decline amounts.
Looking at the business situation in the segment, electrical discharge machining and surface treatment segment, in the industrial gas turbine parts processing and energy-related parts processing were reduced, leading the cost of airplane engine parts business had occurred, declined, losses it was.
Mold segment by the weak such as aluminum extrusion die of housing sash, was reduced both sales and profits.
Machinery segment, from the fact that sales of digital servo press was increased and automobile-related press parts processing was also steady growth, sales increased and profit.
In order to deal with the severe business conditions, according to the movement of maintenance enhancements are underway prime mover-related customers, we think to start the initiatives total support such as parts supply for overseas users and surface treatment repairs in production site, and aim to ensure sales of in new demand is small.
As for even plant-related, in addition to focusing on the approach to non-customers and to being committed to new orders, in machinery, we are promoting the demand development in new fields other than metal such as a film base material.
We have established Komaki plant in September 2014 (Komaki, Aichi Prefecture) as integrated production factory of new entrants and aircraft engine parts business.
In that plant, through the acquisition of an engine manufacturer in the UK Rolls-Royce manufacturing process authentication and international certification "Nadcap", we began the production of the low-pressure turbine blade to be employed in low-fuel consumption engine from August 2015.
Although the pace monthly production of 3,000pieces to 4,000pieces is now, in the second half ended February 2017, it is expected to move to full-scale production of 10,000pieces per month, 120,000pieces per year.
In Komaki plant, the production of this low-pressure turbine blade, in addition to thermal spraying or heat treatment, orders new aircraft engine parts centered on the special process of non-destructive inspection, has established a production system.
2 aircraft engine parts of the above, are the orders from different major aircraft engine parts manufacturer, and this shows the extent of the demand for consistent processing production.
In Komaki plant, we are focused on to keep these parts production on track time being, to prospect the ending February 2019 will aim to surplus of aircraft engine parts business.
In parallel with the entry into the aircraft engine components business, the company launched an integrated production items of small and medium-sized gas turbines in the previous fiscal year, it is produced in Okayama Plant (Akaiwa-shi,Okayama-ken).
This integrated production, which began as a one-stop response to the order of the leading turbine manufacturers, then, has also led to secure orders from other manufacturers, continued steady growth can be expected.
Another of the new movement, began efforts to support the forming of carbon fiber-reinforced thermoplastic (CFRTP) in collaboration with the machine trading companies and mold material manufacturer.
We provide a prototype for equipment with digital servo press or the like, and support the establishment of mass production technology.
Through this support business, we have accumulated a molding technique or the like to increase productivity of the CFRTP parts, and we think that will lead to the development and sales of private press.
In this way, after the cornerstone of the existing business, we are sowing to the new growth in multilateral.
In the future, the previously mentioned the prime mover-related total support and plant-related trading partners expanded, including initiatives such as new items of machinery and equipment, we will build a strong business foundation than in the past.
We slogan to "challenge to a new growth stage", began a three-year medium-term management plan for the final year the year ended February 2018.
The year of the plan the first year, the production of aircraft engine parts in Komaki plant started as planned, initiatives from the fact that also are increasing their orders destination integrated production items of small- and medium-sized gas turbine, to a new business model as a parts manufacturer it is regarded as was able to raise the generally favorable outcome.
However, the results for the year worse than expected, continue from that which is expected to impact of environmental change in the crude oil depreciation, etc., the numerical targets for the 2018 fiscal year ending February, the consolidate results of 13.5 billion 53 million yen, operating income of 1.3 billion 68 million yen, ordinary income of 1.3 billion 60 million yen, net income of 800 million 29 million yen, defined at the time of planning sale is difficult to achieve.
Based on these circumstances, we have re-established a medium-term management plan in the form of the final fiscal year ending February 2019, the net sales of 12.9 billion 62 million yen as the consolidated results, the operating profit of 1 billion 31 million yen, ordinary income of 900 million 96 million yen, was a net income of 600 million 35 million yen as a new numerical targets.
The numerical targets are expected to be reviewed on an annual basis.
Basic policy aimed at a new stage of growth is not changed, for the existing businesses, they aim to rebuild based on the performance improvement measures described above, together with that to promote a company-wide efforts to improve productivity and cost down, we will strive to improve profitability.
It should be noted that, we expect for the year ended February 2017, net sales of 10.4 billion 10 million yen (year on year up 6.3%) as the consolidate results, operating income of 414 million yen (up 223.6%), ordinary income of 374 million yen (up 313.4%), net income of 243 million yen (up 358.1%).
This time of year-end dividends, while ensuring internal reserves necessary for the management structure and strengthening the future of business development, based on the profit distribution policy to continue a stable dividend, as planned 10 yen per share (year-on-year 10 yen dividend cut) we were allowed to.
2017 February period of the year-end dividend, assuming the recovery of business results, we plan to the 15 yen for now.
We have introduced executive officer system from September 1, 2015. This is, to management and clarification function responsibility and authority by achieving a share of the executive, is intended to continue to achieve a speedy decision and efficient business operations than in the past.
At the same time, to promote the recruitment of young talent, while activating the organization, aims to continue to develop the next generation of management.
Through the introduction of this system, we encourage a more self-transformation to the action with a sense of ownership in the company, will continue to further strengthen corporate governance.
The future of the company, while based on the existing business, built a business foundation as a parts manufacturer by consistent processing, we will further aim to step up by the development of new businesses and new items.
We ask everyone of shareholders, we look forward to the expansion of corporate value in the future, thank you look forward to long-term support of to our business in the future.