MIRA INFORM REPORT

 

 

Report Date :

14.08.2007

 

IDENTIFICATION DETAILS

 

Name :

NAGASE & CO LTD

 

 

Registered Office :

1-1-17 Shinmachi Nishiku Osaka 550-8668

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2006

 

 

Date of Incorporation :

Dec 1917

 

 

Legal Form :

Limited Company (Kabushiki Kaisha)

 

 

Line of Business :

Import, export, wholesale of chemicals

 

 

RATING & COMMENTS

 

MIRA’s Rating :

A

 

RATING

STATUS

PROPOSED CREDIT LINE

56-70

A

Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums

Fairly Large

 

Maximum Credit Limit :

Yen 23967.3 millions

 

 

Status :

Good

 

 

Payment Behaviour :

Regular

 

name

 

NAGASE & CO LTD

 

 

REGD NAME

 

Nagase Sangyo KK

 

 

MAIN OFFICE

 

1-1-17 Shinmachi Nishiku Osaka 550-8668 JAPAN

Tel: 06-6535-2114

Fax: 06-6535-2160

 

TOKYO OFFICE:  5-1 Nihombashi-Kobunacho Chuoku Tokyo, as given

URL: http://www.nagase.co.jp/

E-Mail address: info@nagase.co.jp

 

 

ACTIVITIES

 

Import, export, wholesale of chemicals

 

 

BRANCHES

 

Tokyo, Nagoya, Fukuoka, Hiroshima, Takamatsu, other

 

 

OVERSEAS

 

USA (6), Canada, UK, Germany, China (14), Taiwan (2), Korea (2), Thailand (2),  Malaysia (3), Singapore (3), VIETNAM(3), India, Indonesia, UAE, other

 

 

CHIEF EXEC

 

HIROSHI NAGASE, PRES & CEO

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY

 

FINANCES        FAIR                             A/SALES          Yen 648,023 M

PAYMENTS      REGULAR                     CAPITAL           Yen 9,699 M

TREND             STEADY                       WORTH            Yen 196,620 M

STARTED         1917                             EMPLOYES      3,504

 

 

COMMENT

 

TOP-RANKED TRADING HOUSE SPECIALIZING IN INDUSTIRAL CHEMICALS.  FINANCIAL SITUATION CONSIDERED FAIR AND GOOD FOR CREDIT ENGAGEMENTS: US$580,000 / O/A 60 DAYS

 

MAX CREDIT LIMIT: YEN 23,967.3 MILLION, 30 DAYS NORMAL TERMS.

 

                        Forecast (or estimated) figures for 31/03/2007 fiscal term

 

 

HIGHLIGHTS

 

The subject company is top-ranked trading house specializing in industrial chemicals, founded originally in 1832 by a certain Nagase as a dyestuff merchant in Kyoto.  In 1900, established business ties with Bassel Chemical of Switz (now Chiba Specialty Chemicals) and since diversified into various other industrial chemicals.  Excels in dyestuffs, synthetic resins, etc.  Actively engaged in new technological sector such as pharmaceuticals raw materials, specialty resins, biotechnology, electronics and other new materials.  In Oct 2003 the firm set up JV’s in Taiwan and China for offering CAD auto-parts design services, following the one set up in USA.   The firm is reported purchased Pac Tec GmbH, a German producer of semiconductor mfg equipment.  Nagase is taking steps to expand its business in latter-stage semiconductor mfg and is planning to use Pac Tech’s technologies to gain ground in supplying equipment and materials.  Since 2000, the firm has served as an agent for Pac Tech, selling the firm’s equipment and licensing technology in Japan.

           

 

FINANCIAL INFORMATION

 

The sales volume for Mar/2006 fiscal term amounted to Yen 648,023 million, a 12.6% up from Yen 575,636 million in the previous term.  Sales in Greater China expanded mainly in the automotive sector.  Chemicals up by 7.0% to Yen 269,260 million; Plastics up by 21.7% to Yen 229,270 million; Electronics up by 12.4% to Yen 137,860 million, due to gains from the sales of accompanying parts derived from precision abrasive materials and LCD-related businesses.  The recurring profit was posted at Yen 18,798 million and the net profit at Yen 12,892 million, respectively, compared with Yen 15,158 million recurring profit and Yen 10,384 million net profit, respectively, a year ago.

 

For the term just ended Mar 2007 the recurring profit is projected at Yen 22,700 million and the net profit at Yen 13,600 million, respectively, on a 7.1% rise in turnover, to Yen 694,000 million.  Synthetic resins advancing on firm Asia-bound demand.  Electronics bottoming out.  Profits may slightly exceed past.

 

(Apr/Dec/2006 results): Sales Yen 525,155 million (up 10.8%), operating profit Yen 16,621 million (up 18.9%), recurring profit Yen 17,897 million (up 13.9%), net profit Yen 10,271 million (down 4%).  (% compared with the corresponding period last year). 

 

The financial situation is considered FAIR and good for ORDINARY business engagements.  Max credit limit is estimated at Yen 23,967.3 million, on 30 days normal terms.  The proposed amount is considered within the firm’s financial capabilities.

 

 

REGISTRATION

 

Date Registered:            Dec 1917

Legal Status:                 Limited Company (Kabushiki Kaisha)

Authorized:                    346,990,000 shares

Issued:                          138,408,285 shares

Sum:                            Yen 9,699 million

Major shareholders (%):Company’s Treasury Stock (7.5), Master Trust Bank of Japan (7.1), Japan Trustee

                                    Services Bank T (6.6), Sumitomo Trust Bank (4.4), SMBC (3.1), Hiroshi     Nagase (3.0),

                                    Nippon Life Ins (2.8), Reiko Nagase (2.5), Mitsui Sumitomo Ins (2.1), MUFG (2.0);

                                    foreign owners (13.7)

No. of shareholders:       4,675

Listed on the S/Exchange (s) of: Tokyo, Osaka

Managements: Hideo Nagase, ch; Hiroshi Nagase, pres & CEO; Yoshizo Shibata, dir; Kyoichi Zushi, dir; Makoto Tsuruoka, dir; Reiji Nagase, dir, Eiji Asama, dir; Kazuo Nagashima, dir; Haruyuki Niimi, dir; Takuya Gotoh, dir

 

Nothing detrimental is known as to the commercial morality of executives.

 

 

Related companies

 

Nagase Chemtex, Totaku Ind, Hoei Sangyo, Nagase Logistics, other (Tot 40 as of Mar/06)

           

 

OPERATION

 

Activities: Specialized trading house for import, export, wholesale of industrial chemicals    

(Sales breakdown by divisions): dyestuffs, pigments, other industrial chemicals (42%),   synthetic resins (35%), electronic materials & equipment (21%), health-care products, foodstuffs, others (2%). 

 

(Overseas sales ratio 40.1%: N America 3.2%; Asia 34.6%; other region 2.3%).

 

Clients: [Chemical mfrs, wholesalers] Sekisui Chemical, Nippon Paint, Dainippon Ink & Chemicals, Sumitomo Chemical, Mitsubishi Motors, Otsuka Pharmaceutical, Shinto Paint, Fujitsu Ltd, Toshiba Matsushita Display Technology, Kansai Paint, Mitsubishi Electric Trading, Kasai Kogyo, other.

 

No. of accounts: 2,000

 

Domestic areas of activities: Nationwide

 

Suppliers: [Mfrs, wholesalers] Sumitomo Chemical, Daicel Chemical Ind, Nippon Shokubai, Mitsubishi Chemical, Tottori Sanyo Electric, other.

 

Payment record: Regular

 

Location: Business area in Osaka.  Office premises at the caption address are leased and maintained satisfactorily.

 

 

Bank References

 

SMBC Bank (H/O)

Mizuho Corporate Bank (Ohtemachi)

 

Relations: Satisfactory

 

 

FINANCES

 

FINANCES: (Consolidated in million yen)

 

　

　

Terms Ending:

31/03/2006

31/03/2005

INCOME STATEMENT

 

 

 

  Annual Sales

　

648,023

575,636

 

  Cost of Sales

580,383

513,675

 

      GROSS PROFIT

67,640

61,960

 

  Selling & Adm Costs

50,043

48,704

 

      OPERATING PROFIT

17,596

13,256

 

  Non-Operating P/L

1,202

1,893

 

      RECURRING PROFIT

18,798

15,158

　

      NET PROFIT

12,892

10,384

BALANCE SHEET

 

 

 

 

  Cash

　

23,539

17,853

 

  Receivables

 

194,664

173,318

 

  Inventory

 

40,268

36,316

 

  Securities, Marketable

　

　

 

  Other Current Assets

7,828

7,173

 

      TOTAL CURRENT ASSETS

266,299

234,660

 

  Property & Equipment

30,819

29,674

 

  Intangibles

 

1,506

520

 

  Investments, Other Fixed Assets

98,149

70,436

 

      TOTAL ASSETS

396,773

335,290

 

  Payables

 

118,810

110,648

 

  Short-Term Bank Loans

14,311

10,532

 

　

 

　

　

 

  Other Current Liabs

27,126

20,067

 

      TOTAL CURRENT LIABS

160,247

141,247

 

  Debentures

 

　

　

 

  Long-Term Bank Loans

5,523

3,487

 

  Reserve for Retirement Allw

6,835

8,347

 

  Other Debts

　

21,791

10,271

 

      TOTAL LIABILITIES

194,396

163,352

 

      MINORITY INTERESTS

5,755

4,844

 

Common stock

9,699

9,699

 

Additional paid-in capital

9,725

9,648

 

Retained earnings

145,709

134,778

 

Evaluation p/l on investments/securities

36,504

20,431

 

Others

 

587

(1,556)

 

Treasury stock, at cost

(5,604)

(5,908)

 

      TOTAL S/HOLDERS` EQUITY

196,620

167,092

　

      TOTAL EQUITIES

396,773

335,290

CONSOLIDATED CASH FLOWS

 

 

 

 

Terms ending:

31/03/2006

31/03/2005

 

Cash Flows from Operating Activities

　

-2,341

1,716

 

Cash Flows from Investment Activities

-3,809

-1,412

 

Cash Flows from Financing Activities

9,330

-5,119

　

Cash, Bank Deposits at the Term End

　

22,936

17,215

ANALYTICAL RATIOS            Terms ending:

31/03/2006

31/03/2005

 

 

Net Worth (S/Holders' Equity)

196,620

167,092

 

 

Current Ratio (%)

166.18

166.13

 

 

Net Worth Ratio (%)

49.55

49.84

 

 

Recurring Profit Ratio (%)

2.90

2.63

 

 

Net Profit Ratio (%)

1.99

1.80

 

 

Return On Equity (%)

6.56

6.21

 

 

RATING EXPLANATIONS

 

RATING

STATUS

 

 

PROPOSED CREDIT LINE

>86

Aaa

Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums

 

Unlimited

71-85

Aa

Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums

 

Large

56-70

A

Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums

 

Fairly Large

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

 

Satisfactory

26-40

B

Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.

 

Small

11-25

Ca

Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity

 

Limited with full security

<10

C

Absolute credit risk exists. Caution needed to be exercised

 

 

Credit not recommended

NR

In view of the lack of information, we have no basis upon which to recommend credit dealings

No Rating

 

 

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

 

Financial condition (40%)            Ownership background (20%)                 Payment record (10%)

Credit history (10%)                    Market trend (10%)                                Operational size (10%)

 

 

 

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions