MIRA
INFORM REPORT
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Report Date : |
17.12.2008 |
IDENTIFICATION
DETAILS
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Name : |
KANEKA CORPORATION |
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Registered Office : |
3-2-4 Nakanoshima Kitaku Osaka 530-8288 |
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Country : |
Japan |
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Financials (as on) : |
31.03.2008 |
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Date of Incorporation : |
September, 1949 |
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Legal Form : |
Limited Company |
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Line of Business : |
Manufacturer of chemicals,
foodstuffs, electronic materials |
RATING &
COMMENTS
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MIRA’s Rating : |
A |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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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 |
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Maximum Credit Limit : |
Yen 18,526.4million |
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Status : |
Good |
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Payment Behaviour : |
Regular |
Name
KANEKA CORPORATION
REGD NAME
Kaneka KK
MAIN OFFICE
3-2-4 Nakanoshima Kitaku Osaka 530-8288 JAPAN
Tel: 06-6226-5050 Fax:
06-6226-5117
* The given address is its Tokyo Head Office
E-Mail address: info@kaneka.co.jp
ACTIVITIES
Mfg of chemicals, foodstuffs, electronic materials
BRANCHES
Tokyo (as given), Nagoya
OVERSEAS
Belgium, Singapore, Malaysia, Australia, USA, China, other
FACTORY(IES)
Takasago (Hyogo), Settsu (Osaka), Otsu (Shiga), Kashima
(Chiba)
CHIEF EXEC
KIMIKAZU SUGAWARA, PRES
Yen Amount: In
million Yen, unless otherwise stated
SUMMARY
FINANCES FAIR A/SALES Yen 502,968 M
PAYMENTS REGULAR CAPITAL Yen 33,046 M
TREND STEADY WORTH Yen 267,598 M
STARTED 1949 EMPLOYES 7,498
COMMENT
LEADING
MFR OF PVC RESINS & CAUSTIC SODA.
FINANCIAL SITUATION COSIDERED
FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.
MAX CREDIT LIMIT: YEN 18,526.4MILLION, 30 DAYS NORMAL TERMS
Forecast
(or estimated) figures for 31/03/2009 fiscal term
HIGHLIGHTS
The subject company was established on the basis of a manufacturing division separated from former Kanebo Ltd, apparel, cosmetic mfr, Tokyo, in order to mfg PVC for the first time in Japan. Now has grown to be a leading chemical mfg firm with top level engineering development capacity. Strength in high polymer, synthesizing, and fermentation technologies. Holds one of world’s largest market shares in MBS resin and MS polymer. Expanding into pharmaceutical intermediates, electronic materials, synthetic fibers & bio-chemicals. Under business withdrawal/realignment plan, now reviewing below-cost businesses; selling off deficit-ridden polystyrene paper business to Sekisui Plastics by end of Jan/2009, and spinning off resin sash division to consolidate into Tokuyama Corp.
FINANCIAL INFORMATION
The sales volume for Mar/2008 fiscal term amounted to Yen 502,968 million, a 6.3% up from Yen 473,170 million in the previous term. Chemicals, functional plastics, plastics & foodstuffs rose. By divisions, Chemicals up 10.0% to Yen 102,468 million, boosted by exports of polyvinyl chloride into Asian countries; Functional Plastics up 2.6% to Yen 83,169 million, as sales for modified silicone polymers expanded chiefly in Europe & USA; Expandable Plastics up 3.2% to Yen 73,800 million; Foodstuffs up 8.0% to Yen 119,638 million as sales of edible oils & dairy products rose; Life Science down 10.3% to Yen 36,162 million, due to declined sales of bulk & intermediate pharmaceuticals; Electronics down 10.8% to Yen 57,044 million; Synthetic Fiber up 23.6% to Yen 30,687 million. The recurring profit was posted at Yen 33,866 million and the net profit at 18,817 million, respectively, compared with Yen 473,170 million recurring profit and Yen 18,363 million net profit, respectively, a year ago.
(Apr/Sept/2008 results): Sales Yen 248,925 million (down 0.9%), operating profit Yen 10,160 million (down 44.2%), recurring profit Yen 10,218 million (down 43.4%), net profit Yen 4,935 million (down 50.8%). (% compared with the corresponding period a year ago). Sales rose in chemicals, expandable plastics, foods, while decreased in functional plastics, synthetic fibers, other. By divisions, Chemicals up 0.4% to Yen 50,797 million, higher materials costs failed to be absorbed with exports lackluster; Functional Plastics down 5.0% to Yen 3,680 million, due mainly to slumping US housing market; Expandable Plastics up 3.8% to Yen 38,035 million; Foods up 7.6% to Yen 61,570 million; Life Science up 45.7% to Yen 3,355 million as sales of medical devices, bulk & intermediate pharmaceuticals were steady and rising. Operating income declined due to such factors as higher raw materials prices & sluggish demand, the firm says. The net price decline is referred to extraordinary losses, including Yen 1,350 million write-down of investment securities and Yen 474 million in impairment losses on fixed assets.
For the current term ending Mar 2009 the recurring profit is projected at Yen 23,000 million and the net profit at Yen 12,500 million, on a 0.8% rise in turnover, to Yen 507,000 million. Functional resins in hardships due in part to sluggish housing industry in US. Electronics & synthetic fibers also depressed. Price hikes unable to keep up with surging material costs. Yen’s appreciation against foreign currencies negative effect on profit performance. Impact also felt from poor sales in the 1st half 2008.
The
financial situation is considered FAIR and good for ORDINARY business
engagements. Max credit limit is
estimated at Yen 18,526.4 million, on 30 days normal terms.
REGISTRATION
Date Registered: Sept 1949
Legal
Status: Limited Company (Kabushiki Kaisha)
Authorized:
750 shares
Issued:
350 shares
Sum: Yen 33,046 million
Major
shareholders (%): Master Trust Bank of Japan T (6.0), Japan Trustee Services
T (5.9), Japan Trustee Services T4 (5.5), Nippon Life Ins (5.4), SMBC (4.4), Meiji
Yasuda Life Ins (3.7), Mitsui Sumitomo Ins (3.5), MUFG (3.2), Company’s
Treasury Stock (2.7), Northern Trust (AVFC) American (1.8); foreign owners
(25.5)
No. of
shareholders: 14,337
Listed
on the S/Exchange (s) of: Tokyo, Osaka, Nagoya
Managements:
Masatoshi Takeda, ch; Kimikazu Sugawara, pres; Setsuo Shimazaki, s/mgn dir;
Masatoshi Haatori, s/mgn dir; Yoichi Shima, mgn dir; Satomi Takahashi, mgn dir;
Toshiji Kanou, mgn dir; Toshihiro Suzuki, mgn dir; Nobuyuki Koyama, mgn dir;
Tetsuo Hara, mgn dir; Tetsuo Ikuno, mgn dir; Hirosaku Nagano, mgn dir; Shigeru
Kamemoto, mgn dir
Nothing detrimental is known as to the commercial morality
of executives.
Related
companies: Kaneka Belgium, Kaneka Texas, Showa Kasei, other
OPERATION
Activities: Manufactures PVC resins, soda, foods,
other (--100%):
(Sales Breakdown by Divisions):
Chemicals (20%): Polyvinyl chloride (PVC), rigid PVC
compounds, caustic soda, paste PVC, hydrochloric acid, flexible PVC compounds,
chlorinated PVC;
Functional Plastics (17%): modifier, heat-resistant ABS
resins, self-extinguishing ABS resins, modified silicone polymer (MS Polymer),
Alkyl terminated, polyisobuthylenes;
Expandable Plastics & Products (15%): extruded
polystyrene foam boards, insulating PVC sash windows, polystyrene foam sheets,
polyolefin foam (boards & moldings), expandable polystyrene;
Foodstuffs (24%): margarine & shortening,
confectionary fats, bakery yeast;
Life Science Products (7%): ubidecarenone (Coenzyme Q10), anti-hypertensive
drug intermediates, intermediates for antibiotics, liposorber system
(LDL-cholesterol adsorption system), adsorption column for dialysis-related
amyloidosis);
Electronic Products (11%): ultra heat-resistant polyimide
film, bonded magnets, magnet wire, PVC pipes for underground cables, solar
cells, optical films;
Synthetic Fibers, Others (6%): modacrylic fibers, others;
Overseas Sales Ratio (37.2%): Asia 15.5%, N America 7.2%,
Europe 11.3%, others 3.2%
Clients
[Mfrs, wholesalers] Mitsui &
Co, Mitsubishi Corp, Kubota Corp, Kyowa Hakko Kogyo, Mitsubishi Plastics, Showa
Chemical Ind, other
No. of accounts: 1,000 – 2,000
Domestic areas of activities: Nationwide
Suppliers
[Mfrs, wholesalers] Mitsui & Co, Mitsubishi Corp, Mitsui
Chemical, other
Payment
record: Regular
Location: Business area in Osaka. Office premises at the caption address are
owned and maintained satisfactorily.
Bank References
SMBC (Osaka-Chuo)
MUFG (Osaka)
Relations: Satisfactory
FINANCES: (In Million Yen)
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FINANCES: (Consolidated
in million yen) |
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Terms Ending: |
31/03/2008 |
31/03/2007 |
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INCOME STATEMENT |
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Annual Sales |
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502,968 |
473,170 |
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Cost of Sales |
376,031 |
344,519 |
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GROSS PROFIT |
126,936 |
128,651 |
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Selling & Adm Costs |
91,191 |
91,985 |
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OPERATING PROFIT |
35,745 |
36,666 |
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Non-Operating P/L |
-1,879 |
273 |
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RECURRING PROFIT |
33,866 |
36,939 |
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NET PROFIT |
18,817 |
18,363 |
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BALANCE SHEET |
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Cash |
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20,379 |
20,396 |
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Receivables |
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113,224 |
118,401 |
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Inventory |
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71,313 |
65,277 |
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Securities, Marketable |
1,907 |
2,358 |
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Other Current Assets |
11,616 |
12,787 |
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TOTAL CURRENT ASSETS |
218,439 |
219,219 |
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Property & Equipment |
160,615 |
159,403 |
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Intangibles |
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2,822 |
3,030 |
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Investments, Other Fixed Assets |
70,744 |
85,457 |
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TOTAL ASSETS |
452,620 |
467,109 |
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Payables |
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67,921 |
69,014 |
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Short-Term Bank Loans |
22,020 |
20,266 |
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Other Current Liabs |
44,241 |
44,700 |
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TOTAL CURRENT LIABS |
134,182 |
133,980 |
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Debentures |
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10,000 |
15,000 |
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Long-Term Bank Loans |
17,207 |
17,196 |
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Reserve for Retirement Allw |
18,452 |
19,179 |
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Other Debts |
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5,181 |
10,474 |
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TOTAL LIABILITIES |
185,022 |
195,829 |
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MINORITY INTERESTS |
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Common
stock |
33,046 |
33,046 |
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Additional
paid-in capital |
34,836 |
34,857 |
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Retained
earnings |
194,740 |
188,417 |
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Evaluation
p/l on investments/securities |
10,625 |
24,115 |
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Others |
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3,368 |
5,324 |
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Treasury
stock, at cost |
(9,017) |
(14,479) |
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TOTAL S/HOLDERS` EQUITY |
267,598 |
271,280 |
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TOTAL EQUITIES |
452,620 |
467,109 |
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CONSOLIDATED CASH FLOWS |
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Terms ending: |
31/03/2008 |
31/03/2007 |
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Cash
Flows from Operating Activities |
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39,418 |
32,742 |
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Cash
Flows from Investment Activities |
-34,988 |
-33,894 |
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Cash Flows
from Financing Activities |
-4,433 |
-2,081 |
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Cash,
Bank Deposits at the Term End |
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21,988 |
22,635 |
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ANALYTICAL RATIOS Terms
ending: |
31/03/2008 |
31/03/2007 |
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Net
Worth (S/Holders' Equity) |
267,598 |
271,280 |
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Current
Ratio (%) |
162.79 |
163.62 |
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Net
Worth Ratio (%) |
59.12 |
58.08 |
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Recurring
Profit Ratio (%) |
6.73 |
7.81 |
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Net
Profit Ratio (%) |
3.74 |
3.88 |
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Return
On Equity (%) |
7.03 |
6.77 |
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FOREIGN EXCHANGE
RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
Rs.47.33 |
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UK Pound |
1 |
Rs.73.92 |
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Euro |
1 |
Rs.66.69 |
RATING
EXPLANATIONS
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
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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 |
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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 |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit
consideration. Capability to overcome financial difficulties seems
comparatively below average. |
Small |
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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 |
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<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
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NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
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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%)