MIRA
INFORM REPORT
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Report Date : |
10.11.2008 |
IDENTIFICATION
DETAILS
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Name : |
TOAGOSEI CO LTD |
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Registered Office : |
1-14-1 Nishishimbashi Minatoku Tokyo 105-8419 |
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Country : |
Japan |
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Financials (as on) : |
31.12.2007 |
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Date of Incorporation : |
March 1942 |
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Legal Form : |
Limited Company (Kabushiki Kaisha) |
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Line of Business : |
Manufacturer of Industrial Chemicals |
RATING &
COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Maximum Credit Limit : |
YEN 6,437.1 Million |
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Status : |
Good |
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Payment Behaviour : |
Regular |
name & address
TOAGOSEI
CO LTD
REGD NAME: Toa Gosei KK
MAIN OFFICE: 1-14-1 Nishishimbashi Minatoku Tokyo 105-8419
JAPAN
Tel:
033597-7215 Fax: 03-3597-7217
URL: http://www.toagosei.co.jp/
E-Mail address: info@toagosei.co.jp
ACTIVITIES
Mfg of industrial chemicals
BRANCH(ES)
Osaka, Nagoya, Toyama, Sakaide (Kagawa), Fukuoka
OVERSEAS
Toagosei America (Ohio); TOA-DIC Zhangjiagang Chemical,
Toagosei Hong Kong; Toagosei (Zhuhai) (--China); Taiwan Toagosei, TOA Jet
Chemical (--Taiwan); Toagosei Singapore (Singapore); Toagosei Korea Co Ltd
FACTORY(IES)
Nagoya, Tokuyama, Takaoka, Sakaide
CHIEF EXEC
FUTOSHI HASHIMOTO, PRES
Yen
Amount: In million Yen,
unless otherwise stated
SUMMARY
FINANCES FAIR A/SALES Yen 162,729 M
PAYMENTS REGULAR CAPITAL Yen 20,886 M
TREND STEADY WORTH Yen 118,939 M
STARTED 1942 EMPLOYES 2,552
COMMENT
MFR OF
INDUSTRIAL CHEMICALS.
FINANCIAL
SITUATION COSIDERED FAIR AND GOOD FOR ORDINARY
BUSINESS
ENGAGEMENTS.
MAX
CREDIT LIMIT: YEN 6,437.1 MILLION, 30 DAYS NORMAL TERMS.
Forecast
(or estimated) figures for 31/12/2008 fiscal term
HIGHLIGHTS
This is a medium-sized chemical
mfr of Mitsui group. Originally founded
in 1933 as Yahagi Kogyo Co Ltd for mfg ammonium sulfate, sulfuric & nitric
acid using surplus electricity from the then parent company, Mitsui Chemical Co
Ltd. In 1942, reorganized and
established second Yahagi Kogyo Co Ltd.
In 1944, merged 3 soda companies and became general chemical maker,
named Toagosei Chemical Industry Co Ltd, and later renamed as captioned. Shifted mainstay items from electrolytic
process chemicals to acrylic-based products.
Leads the industry in acrylic-related products. Instant glue is another revenue source. Known for end-product instant glue “Aron
Alpha”. Expectation on growth of LHC,
purest in Japan, for use as cleaning agent for semiconductor wafers. Scheduling to complete capacity buildup of
acrylic acid plants in Japan in 2010.
New acrylic polymer plant in Singapore will fully start up in late 2009,
spurring development of downstream business field.
(Overseas Activities):
In 1990,
established Aron Alpha jointly with US Borden Ind (presently Elmer’s Products
Inc to strengthen sales of instant glue.
In 1994, constructed a factory for filling & packaging in Columbus,
Ohio to secure a supply base for North & South American regions. In 1995, constructed another factory in
Zhuhai, China, established sales bases in Hong Kong & Singapore to expand
adhesive business. In 1998, completed
mfg plant in Singapore for acrylic acid & acrylic ester, the mainstay
items, and its business operation started in 1999. In 2000, established a sales base in Taiwan for Aronix,
UV-curable resin, and its mfg operation began in 2001. In 2004, a new company was established in
Zhangjiagang, China.
Overseas Subsidiaries: Toagosei
America (Ohio); TOA-DIC Zhangjiagang Chemical, Toagosei Hong Kong; Toagosei
(Zhuhai) (--China); Taiwan Toagosei, TOA Jet Chemical (--Taiwan), Toagosei
Singapore (Singapore); Toagosei Korea Co Ltd
FINANCIAL INFORMATION
The sales volume for Dec/2007
fiscal term amounted to Yen 162,729 million, a 4.4% up from Yen 155,804 million
in the previous term. By divisions,
Basic Chemicals up 1.3% to Yen 53,470 million, thanks to price hikes of caustic
soda for acrylic products, polymer coagulants, whose operations consolidated
with Mitsui Chemical; Acrylic Div up 12.3% to Yen 48,674million; Functional
Products up 3.6% to Yen 26,677 million.
Sub in Singapore improved profitability in functional products, and
increased production, spurred by expanded demand for electronic equipment. The recurring profit was posted at Yen
13,462 million and the net profit at Yen 6,403 million, respectively, compared
with Yen 13,603 million recurring profit and Yen 6,961 million net profit,
respectively, a year ago.
Jan/Sept/2008
results): Sales Yen 124,917 million (up 4.3%), operating profit Yen 9,224
million (down 2.1%), recurring profit Yen 9,413 million (down 6.1%), net profit
Yen 4,422 million (down 13.3%). (%
compared with the corresponding period a year ago). Amid unforeseeable economic downturn due to financial crisis
starting from USA, the chemical industry was thrown into dire environment added
to rising prices of crude oil/ naphtha & materials. The firm carried out drastic cost-cutting
efforts, while concentrated on raising selling prices of products and expanded
sales of higher value-added products to increase sales & profits. Profits were, however, deteriorated due to
higher materials & fuel oil prices and increased depreciation costs from
the revision of Corporate Law.
For
the current term ending Dec 2008 the firm revised its initial forecasts
(parenthesis) as follows: Sales Yen 168,000 million (Yen 166,600 million),
operating profit Yen 12,400 million (Yen 14,800 million), recurring profit Yen
12,700 million (Yen 14,800 million) and net profit Yen 5,800 million (Yen 7,400
million).recurring profit is projected at Yen 14,800 million and the net profit
at Yen 7,400 million, on a 2.4% rise in turnover, to Yen 166,600 million. The reasons for the revision are, as the
firm reiterates: Selling price hikes have been accepted by clients, thus sales
amount will rise; recurring profit fall is largely referred to the appreciation
of Japanese Yen against foreign currencies; net profit decrease may include
possible extraordinary losses from anticipated NC’s from some buyers who may be
in financial difficulties amid the present financial crisis.
The financial situation is considered FAIR and good for ORDINARY business engagements. Max credit limit is estimated at Yen 6,437.1 million, on 30 days normal terms.
REGISTRATION
Date Registered: Mar
1942
Legal Status: Limited Company (Kabushiki Kaisha)
Authorized: 550 million shares
Issued: 263,992,598 shares
Sum: Yen 20,886 million
Major shareholders (%)
Japan Trustee Services T (5.2),Master
Trust Bank of Japan T (4.6), SMBC (4.4), Customers’ S/Holding Assn (2.2), MUFG
(2.1), Tokio Marine & Nichido Fire Ins (2.0), Group Employees’ S/Holding
Assn (1.9), Aioi Ins (1.8), Norin Chukin Bank (1.4), Mitsui Life Ins (1.3);
foreign owners (18.1).
No. of
shareholders: 16,764
Listed
on the S/Exchange (s) of: Tokyo, Osaka, Nagoya, Fukuoka
Managements
Akihiko Yamadera, ch; Futoshi
Hashimoto, pres; Akio Arisawa, dir; Katsutoshi Yamada, dir; Kiyoshi Miyazaki,
dir; Shoji Kawamura, dir; Kazuo Kiyota, dir; Soichi Nomura, dir; Shigehisa
Hibino, dir
Nothing detrimental is known as to the commercial morality
of executives.
Related companies
Aron Kasei Co, Oita Chemical Co, MT Aqua Polymer Inc,
Tsurumi Soda Co, other.
OPERATION
Activities:
Manufactures industrial chemicals:
(Sales
breakdown by Divisions): (Cited from the firm’s website)
Basic
Chemicals Div (33%):
Caustic soda: chemical fibers, pulp, dye, and
pharmaceuticals;
Oxygen: combustion enhancing gas for welding
& cutting, oxygen inhalation (and high pressure oxygen treatment) for
medical use, oxygen aeration for wastewater treatment, oxygen-based pulp
bleaching, and fermentation in biotechnology;
Sulfuric acid: fertilizers, synthetic fibers, and
inorganic chemicals;
Trichloroethylene: metal degreasing & cleaning
solvents, and raw materials
Acrylic
Products Div (30%):
Acrylic esters: acrylic fibers, fiber processors,
paints, pressure sensitive & other adhesives, leather processors, paper
processors, & acrylic resin, detergent builders;
Acrylic acid: nonwoven cloth binders, flocculants,
dispersants, paper processors, superabsorbent resin, & detergent builders;
Polymer flocculants: treatment of various kinds of
wastewater & dehydration of sludges;
Construction materials: one-pack waterproof spray
materials, decorative waterproof wall materials, permeable type
water-absorption preventive agents, chemical grouts, & earth resistance
reducing agents;
Specialty
Chemicals Div (16%):
Cyanoacrylate instant adhesives: for bonding rubber, plastic,
metal, & wood in industrial & consumer uses;
Heat-resistant adhesives: for bonding metal &
ceramics used in high-temperature environments;
Hot melt adhesives: for bonding plastics, metals
& textiles; for bonding difficult-to-bond plastics like PE, PP polyester,
& nylon;
Special monomers & oligomers: raw
materials for paints, printing inks, coatings, & adhesives;
Silver-based antimicrobial agents: For
kitchen & bathroom equipment, building materials, & textiles;
Antifungal agents: For kitchen equipment, home
appliances, & paints;
Plastics,
other (21%):
Pipes & couplings: rigid PVC pipes;
Environmental products: trash receptacles;
Nursing care products: portable toilets, nursing care
bath products.
Overseas Sales Ratios (15.1%): Asia (China, India, Korea, Taiwan) (11.3%); N America (2.0%), Europe (Belgium, Poland, France) (1.4%), other region (0.4%)
Clients
[Mfrs, wholesalers]
Nagase Corp, Mitsubishi Chemical, Mitsubishi Corp, Nippon Soda, OG Chemical,
other.
No. of accounts: 1,000
Domestic areas of activities: Nationwide
Suppliers
[Mfrs, wholesalers] Mitsubishi Chemical, Shikoku
Electric Power, Chubu Electric Power,
Mitsubishi Corp, Sumitomo Corp, Mitsui & Co, Itochu Corp, Mitsubishi Gas
Chemical, Nippon Shokubai, other..
Payment
record: Regular
Location:
Business area in Tokyo. Office premises
at the caption address are leased and maintained satisfactorily.
Bank References
SMBC (H/O)
MUFG (Tokyo)
Relations: Satisfactory
FINANCIALS
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FINANCES: (Consolidated
in million yen) |
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Terms Ending: |
31/12/2007 |
31/12/2006 |
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INCOME STATEMENT |
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Annual Sales |
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162,729 |
155,804 |
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Cost of Sales |
118,643 |
111,799 |
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GROSS PROFIT |
44,086 |
44,005 |
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Selling & Adm Costs |
31,367 |
31,054 |
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OPERATING PROFIT |
12,719 |
12,950 |
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Non-Operating P/L |
743 |
653 |
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RECURRING PROFIT |
13,462 |
13,603 |
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NET PROFIT |
6,403 |
6,961 |
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BALANCE SHEET |
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Cash |
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9,734 |
14,213 |
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Receivables |
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51,061 |
49,214 |
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Inventory |
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17,379 |
17,333 |
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Securities, Marketable |
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2 |
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Other Current Assets |
2,149 |
8,830 |
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TOTAL CURRENT ASSETS |
80,323 |
89,592 |
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Property & Equipment |
68,736 |
72,897 |
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Intangibles |
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2,294 |
2,230 |
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Investments, Other Fixed Assets |
31,328 |
30,888 |
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TOTAL ASSETS |
182,681 |
195,607 |
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Payables |
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21,530 |
21,204 |
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Short-Term Bank Loans |
8,602 |
14,375 |
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Other Current Liabs |
21,936 |
25,067 |
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TOTAL CURRENT LIABS |
52,068 |
60,646 |
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Debentures |
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Long-Term Bank Loans |
6,867 |
10,657 |
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Reserve for Retirement Allw |
871 |
1,304 |
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Other Debts |
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3,936 |
6,087 |
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TOTAL LIABILITIES |
63,742 |
78,694 |
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MINORITY INTERESTS |
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Common
stock |
20,886 |
20,886 |
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Additional
paid-in capital |
15,073 |
15,069 |
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Retained
earnings |
64,096 |
59,717 |
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Evaluation
p/l on investments/securities |
5,841 |
8,418 |
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Others |
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13,768 |
13,447 |
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Treasury
stock, at cost |
(725) |
(624) |
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TOTAL S/HOLDERS` EQUITY |
118,939 |
116,913 |
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TOTAL EQUITIES |
182,681 |
195,607 |
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CONSOLIDATED CASH FLOWS |
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Terms ending: |
31/12/2007 |
31/12/2006 |
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Cash
Flows from Operating Activities |
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15,651 |
11,600 |
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Cash
Flows from Investment Activities |
-4,209 |
-10,093 |
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Cash
Flows from Financing Activities |
-15,894 |
583 |
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Cash,
Bank Deposits at the Term End |
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9,710 |
14,186 |
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ANALYTICAL RATIOS Terms
ending: |
31/12/2007 |
31/12/2006 |
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Net
Worth (S/Holders' Equity) |
118,939 |
116,913 |
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Current
Ratio (%) |
154.27 |
147.73 |
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Net
Worth Ratio (%) |
65.11 |
59.77 |
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Recurring
Profit Ratio (%) |
8.27 |
8.73 |
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Net Profit
Ratio (%) |
3.93 |
4.47 |
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Return
On Equity (%) |
5.38 |
5.95 |
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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.47.76 |
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UK Pound |
1 |
Rs.74.87 |
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Euro |
1 |
Rs.60.81 |
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%)