MIRA
INFORM REPORT
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Report Date : |
14.07.2008 |
IDENTIFICATION
DETAILS
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Name : |
KOBE STEEL LTD |
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Registered Office : |
2-10-26 Wakihamacho Chuoku Kobe 651-8585 |
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Country : |
Japan |
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Financials (as on) : |
31.03.2007 |
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Date of Incorporation : |
June 1911 |
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Legal Form : |
Limited Company (Kabushiki Kaisha) |
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Line of Business : |
Manufacturer Steel, Aluminum and Copper, Machinery,
Construction Materials, Other |
RATING &
COMMENTS
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MIRA’s Rating : |
Aa |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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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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Maximum Credit Limit : |
YEN 36,511.4 Million |
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Status : |
Very Good |
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Payment Behaviour : |
Regular |
name & address
KOBE STEEL LTD
REGD NAME: KK Kobe Seikosho
MAIN OFFICE: 2-10-26 Wakihamacho
Chuoku Kobe 651-8585 JAPAN
Tel:
078-261-5111 Fax: 078-261-4123
* The given address is its Tokyo Head Office
at: 5-9-12 Kitashinagawa Shinagawaku Tokyo; Tel: 03-5739-6000; Fax:
03-5739-3903
URL: http://www.kobelco.co.jp/
E-Mail address:admin@kobelco.co.jp
ACTIVITIES
Mfg steel, aluminum & copper, machinery, construction
materials, other
BRANCH(ES)
Tokyo, Osaka, Nagoya, Sapporo, Sendai, Niigata, Toyama,
Takamatsu, Hiroshima, Fukuoka, Okinawa
OVERSEAS
Kobe Steel USA Inc (New York & Detroit), Kobe Steel Asia Pte (Singapore), Kobe Steel Asia Pte Ltd (Hong Kong), Shanghai, Beijing (--subsidiaries)
FACTORY(IES)
Takasago, Kakogawa, Harima (--Hyogo), Kobe, Fujisawa, Hadano, Ibaraki, Mooka, Chofu, Inabe (Mie)
CHIEF EXEC
YASUO INUBUSHI, PRES
Yen Amount: In
million Yen, unless otherwise stated
SUMMARY
FINANCES FAIR A/SALES Yen 1,910,296 M
PAYMENTS REGULAR CAPITAL Yen
233,313 M
TREND STEADY WORTH Yen
636,431 M
STARTED 1911 EMPLOYES 31,828
COMMENT
ONE OF
LEADING STEEL MAKERS IN JAPAN.
FINANCIAL
SITUATION COSIDERED FAIR AND GOOD FOR ORDINARY
BUSINESS
ENGAGEMENTS.
MAX CREDIT LIMIT
YEN 36,511.4 MILLION, 30 DAYS NORMAL TERMS.
Forecast
(or estimated) figures for 31/03/2008 fiscal term
HIGHLIGHTS
This is one of the nation’s leading steel makers, with conglomerate operating materials divisions including: steel (4th ranked in blast furnace), aluminum & copper, and machinery. Construction machinery business is undertaken in tie-up with Wisconsin-based CNH Global. Strengthening wholesale power supply business.
The firm to establish welding firm in China, called Kobe Welding of Qingdao Co Ltd, in Qingdao, Shanghai. This JV will be formed in Apr 2008, with production scheduled to begin one year later. The plant will have a capacity of 1,000 metric tons per month. The JV will be capitalized at Yen 3,000 million, employing about 90 people. Kobe Steel will have a 90% share in the venture and subsidiary Shinsho Corp 5%. Sojitz Marine & Engineering Corp & Tokokosen Corp will each have 2.5%. The new company will make flux cored welding wire for welding carbon steel used in shipbuilding.
FINANCIAL INFORMATION
The sales volume for Mar/2007 fiscal term amounted to Yen 1,910,296 million, a 14.6% up from Yen 1,667,313 million in the previous term. Demand for steel products used in automotive industry, shipbuilding & other mfg industries was strong. By divisions, Iron & Steel up 9.5% to Yen 830,600 million; aluminum & copper up 30.3% to Yen 397,300 million, with rolled copper products rising, aluminum castings & forgings seeing brisk shipments to automotive industry; Machinery up 8.4% to Yen 280,900 million, orders for large waste treatment & sludge treatment projects rising; Construction Machinery up 25.7% to Yen 285,300 million, with domestic demand for hydraulic excavators continuing strong; Electronic Materials up 4.0% to Yen 63,500 million. The recurring profit was posted at Yen 183,278 million and the net profit at Yen 109,668 million, respectively, compared with Yen 176,932 million recurring profit and Yen 84,559 million net profit, respectively, a year ago.
(Apr/Dec/2007 results): Sales Yen 1,539,127 million (up 13.3%), operating profit Yen 140,966 million (down 3.6%), recurring profit Yen 112,560 million (down 11.9%), net profit Yen 68,691 million (down 9.6%). (% compared with the corresponding period a year ago.) Firm demand for steel, construction machinery and other products continued. Steel demand was robust particularly for high-grade products sold to automotive, shipbuilders & machinery mfrs. Profits, on the other hand, declined due to higher materials costs.
For the current term ending Mar 2008 the recurring profit is projected at Yen 150,000 million and the net profit at Yen 90,000 million, on a 1.5% rise in turnover, to Yen 2,130,000 million. Steel, aluminum & copper growing firmly, led by those for automobiles. But change in depreciation method & absence of valuation gains on nonferrous metal inventories posing heavy burden. Both recurring profit and net profit will drop. Construction plan for first commercial blast furnace in N America in final stage. Producing high-purity steel from low-quality materials at low cost.
The financial situation is considered FAIR and good for ORDINARY business engagements. Max credit limit is estimated at Yen 36,511.4 million, on 30 days normal terms.
REGISTRATION
Date Registered: Jun 1911
Legal Status: Limited Company (Kabushiki Kaisha)
Authorized: 6,000 million shares
Issued: 3,115,061,100 shares
Sum: Yen 233,313 million
Major shareholders (%)
Japan Trustee Services T (5.0), Master Trust Bank of Japan T (4.8), Nippon Life Ins (4.0), Mizuho Corporate Bank (2.2), Nippon Steel (2.0), Sumitomo Metal Ind (2.0), Company’s Treasury Stock (2.0), Mitsubishi UFJ Trust (1.6), MUFG (1.5), Japan Trustee Services T4 (1.3); foreign owners (17.1).
No. of shareholders: 171,608
Listed on the S/Exchange (s) of: Tokyo, Osaka, Nagoya
Managements
Koshi Mizukoshi, ch; Yasuo Inubushi, pres & CEO; Hiroshi Sato, v pres; Toshio Kimura, v pres; Shigeto Kotani, v pres; Keiji Koyama, v pres; Hiroyuki Nakayama, s/mgn dir; Takeashi Matsutani, s/mgn dir; Isao Aida, s/mgn dir
Nothing detrimental is known as to the commercial morality of executives.
Related companies
Nippon Koshuh Steel, Kobelco Construction Machinery, Shinko Pantec, Kobelco Eco-Solutions, other (Tot 207 subsidiaries & 71 affiliates)
OPERATION
Activities: Manufactures steel, aluminum & copper, machinery, construction machinery, electronics materials, wholesales power supply, others:
(Sales Breakdown by
Divisions):
Iron & Steel Div
(42%): wire rods & bars, steel sheets, castings & forging, titanium
products, steel powder & powder products, welding electrodes, welding
wires, welding robots, others;
Wholesale Power Supply Div (4%): Shinko Kobe Power Station has electricity generation capacity of 1.4 million kilowatts;
Aluminum & Copper Div (21%): rolled aluminum products, aluminum alloy & magnesium alloy casting, aluminum processed products, rolled copper products;
Machinery Div (14%): screw compressors, centrifugal compressors, reciprocating compressors, refrigeration compressors, uninterruptible power sources, hot isostatic presses, cold isostatic presses, surface modification systems, inspection & analysis systems, crushers, plastic processing machinery, tire & rubber machinery, high pressure anneal equipment, supercritical CO2 equipment;
Construction Machinery Div (15%): hydraulic excavators, mini excavators, wheel loaders, crawler cranes, rough terrain cranes, work vessels, electric mining shovels;
Electronics & Information Div (2%): electronics equipment, communication systems, superconductive products, specialty alloy & other new materials, semiconductor-related equipment, information services;
Real Estate Div (2%): community & urban development, real property services, building management, others.
Clients
[Mfrs, wholesalers] Shinsho Corp, Toyota Tsusho Corp, Mitsui & Co, Sumitomo Corp, Metal One, other.
No. of accounts: 2,000
Domestic areas of activities: Nationwide
Suppliers
[Mfrs, wholesalers] Shinsho Corp, Sojitz Corp, Mitsubishi Corp, Kansai Coke & Chemicals, Shinko Engineering & Maintenance, other.
Payment record: Regular
Location
Business area in Kobe. Office premises at the caption address are owned and maintained satisfactorily.
Bank References
Mizuho Corporate (H/O)
MUFG (H/O)
Relations: Satisfactory
Financials
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FINANCES: (Consolidated
in million yen) |
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Terms Ending: |
31/03/2007 |
31/03/2006 |
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INCOME STATEMENT |
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Annual Sales |
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1,910,296 |
1,667,313 |
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Cost of Sales |
1,543,158 |
1,297,291 |
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GROSS PROFIT |
367,138 |
370,021 |
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Selling & Adm Costs |
158,513 |
149,626 |
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OPERATING PROFIT |
208,624 |
220,395 |
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Non-Operating P/L |
-25,346 |
-43,463 |
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RECURRING PROFIT |
183,278 |
176,932 |
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NET PROFIT |
109,668 |
84,559 |
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BALANCE SHEET |
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Cash |
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99,667 |
96,187 |
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Receivables |
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332,204 |
318,199 |
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Inventory |
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367,332 |
303,003 |
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Securities, Marketable |
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Other Current Assets |
84,275 |
84,878 |
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TOTAL CURRENT ASSETS |
883,478 |
802,267 |
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Property & Equipment |
1,004,769 |
961,873 |
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Intangibles |
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16,791 |
15,166 |
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Investments, Other Fixed Assets |
336,532 |
294,935 |
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TOTAL ASSETS |
2,241,570 |
2,074,241 |
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Payables |
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492,969 |
417,407 |
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Short-Term Bank Loans |
170,266 |
176,332 |
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Other Current Liabs |
257,210 |
291,835 |
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TOTAL CURRENT LIABS |
920,445 |
885,574 |
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Debentures |
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233,187 |
215,363 |
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Long-Term Bank Loans |
315,337 |
278,862 |
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Reserve for Retirement Allw |
46,919 |
52,980 |
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Other Debts |
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89,250 |
72,869 |
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TOTAL LIABILITIES |
1,605,138 |
1,505,648 |
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MINORITY INTERESTS |
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38,593 |
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Common
stock |
233,313 |
233,313 |
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Additional
paid-in capital |
83,282 |
83,145 |
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Retained
earnings |
239,182 |
157,275 |
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Evaluation
p/l on investments/securities |
75,564 |
68,999 |
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Others |
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36,609 |
(11,406) |
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Treasury
stock, at cost |
(31,519) |
(1,327) |
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TOTAL S/HOLDERS` EQUITY |
636,431 |
529,999 |
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TOTAL EQUITIES |
2,241,570 |
2,074,241 |
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CONSOLIDATED CASH FLOWS |
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Terms ending: |
31/03/2007 |
31/03/2006 |
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Cash
Flows from Operating Activities |
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172,785 |
198,181 |
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Cash Flows
from Investment Activities |
-128,557 |
-94,214 |
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Cash
Flows from Financing Activities |
-48,823 |
-93,593 |
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Cash,
Bank Deposits at the Term End |
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98,162 |
95,485 |
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ANALYTICAL RATIOS Terms
ending: |
31/03/2007 |
31/03/2006 |
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Net
Worth (S/Holders' Equity) |
636,431 |
529,999 |
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Current
Ratio (%) |
95.98 |
90.59 |
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Net
Worth Ratio (%) |
28.39 |
25.55 |
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Recurring
Profit Ratio (%) |
9.59 |
10.61 |
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Net
Profit Ratio (%) |
5.74 |
5.07 |
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Return
On Equity (%) |
17.23 |
15.95 |
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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.42.82 |
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UK Pound |
1 |
Rs.84.89 |
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Euro |
1 |
Rs.68.07 |
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%)