MIRA
INFORM REPORT
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Report Date : |
10.11.2008 |
IDENTIFICATION
DETAILS
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Name : |
TOYOBO CO LTD |
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Registered Office : |
2-2-8 Dojimahama Kitaku Osaka 530-8230 |
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Country : |
Japan |
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Financial (as on): |
31.03.2008 |
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Date of Incorporation : |
June 1914 |
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Legal Form : |
Limited Company (Kabushiki Kaisha) |
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Line of Business : |
Spinning of Textiles, Natural Fibers, Cotton, Wool,
Synthetic Resins |
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 8,455.9 Million |
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Status : |
Good |
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Payment Behaviour : |
Regular |
name & address
TOYOBO CO LTD
REGD NAME: Toyo Boseki KK
MAIN OFFICE: 2-2-8 Dojimahama Kitaku Osaka 530-8230 JAPAN
Tel:
06-6348-3111 Fax: 06-6348-3206
E-Mail address: info@toyobo.co.jp
ACTIVITIES
Spinning of textiles, natural fibers, cotton, wool,
synthetic resins
BRANCHES
Tokyo, Nagoya, Ohtsu, Tsuruga
OVERSEAS
Toyobo America Inc; Toyobo Co Ltd China Office (Shanghai);
Toyobo Co Ltd Europe Office (Düsseldorf), other
FACTORY(IES)
Inuyama, Tsuruga, Iwakuni, Ohtsu, Nyuzen, Shogawa
CHIEF EXEC
RYUZO SAKAMOTO, PRES
Yen
Amount: In million Yen,
unless otherwise stated
SUMMARY
FINANCES FAIR A/SALES Yen 431,417 M
PAYMENTS REGULAR CAPITAL Yen
43,341 M
TREND STEADY WORTH Yen
146,500 M
STARTED 1914 EMPLOYES 11,595
COMMENT
TEXTILE
SPINNER.
FINANCIAL
SITUATION COSIDERED FAIR AND GOOD FOR ORDINARY
BUSINESS
ENGAGEMENTS.
MAX CREDIT LIMIT: YEN 8,455.9 MILLION, 30 DAYS NORMAL
TERMS.
Forecast
(or estimated) figures for 31/03/2009 fiscal term
HIGHLIGHTS
The subject company is a
time-honored spinning company dating back to 1914 and pioneer in Japan’s
spinning industry. Now a leading
comprehensive maker of textile products, ranging from natural fibers, including
cotton & wool, to synthetic fibers, such as polyester. Non-textile area, including plastics films,
biochemicals & electronics topping 50% of entire sales. Non-textiles sales are targeted at Yen
305,000 million in Mar 2011 (Yen 253,000 million for Mar/2007 term) with focus
on LCD/optical-use films, etc. In
textiles, first priority is given to improvement of efficiency than sales
growth. Functional membranes enjoying
top market share in Mid East, buoyed by continued new orders from Saudi Arabia
for seawater desalting membranes; developing demand from waterworks facilities
in Japan. Planning to boost production
of automobile-use airbags in Thailand. Now in process of restructuring
textile operations, including liquidation of less productive operations &
subsidiaries. Restructuring costs
weighing heavily.
(Recent news from The Nikkei):
Dated 07/05/2008: Toyobo plant to invest about Yen 15
billion to expand production of film, resin & other chemicals by the end of
2009 as the firm is shifting its focus to those operations from textiles. Toyobo will raise output at Tsuruga plant,
Fukui-Pref, of polypropylene film, used to protect the surfaces of flat-screen
TV panels and other devices during shipment, by 22% to 22,000 tons a year by
June. The firm expects chemicals to
account for 56 of its consolidated operating profit for the current business
year.
Dated 24/07/2008: Toyobo will participate in the joint
project to develop a new carbon fiber material for use in auto bodies, with the
goal of developing mass-market carbon fiber cars. The joint project is developed by Toray Industries Inc, Nissan
Motor Co and Honda Motor Co. The three
will establish mass production technology for the new material by the
mid-2010s.
Dated 10/08/2008: Toyocloth Co, synthetic leather mfr in
Toyobo Co group, has developed a synthetic leather material that is both supple
& dirt-resistant. The new material
has the low-sheen, comfortable feel of quality leather for products like sofas
& purses. The company has priced
the material around 30% above conventional products. It began selling a material for sofas in July, and products made
with the new synthetic leather are expected to hit the stores around September.
FINANCIAL INFORMATION
The sales volume for Mar/2008
fiscal term amounted to Yen 431,417 million, a 1.1% up from Yen 426,666 million
in the previous term. Withdrawal from
unprofitable operations, centering in textiles, and group restructuring efforts
reduced projected sales amount and profits.
By divisions, Films & Functional Resins up 8% to Yen 134,600
million, thanks to healthy shipment of materials for display panels, electronics
components and automotive components both in Japan and overseas despite harsh
business conditions precipitated by continually rising prices of raw materials
& fuel; Industrial Materials up 2.3% to Yen 76,100 million, boosted by
growth in the automotive market, expansion due to rising environmental
awareness, and lively demand for high-performance fibers; Life Science up 4.0%
to Yen 34,000 million, with biotechnology business growing steadily as new
equipment for drug production was brought online, but growth was sluggish for
hollow fiber membranes for artificial kidneys; Apparel & Textiles down 4.8%
to Yen 142,500 million, due to scaling back of less profitable & commodity
business field, and narrowing the focus on functional and specialty apparel. The recurring profit was posted at Yen
21,049 million and the net profit at Yen 4,698 million, respectively, compared
with Yen 25,342 million recurring profit and Yen 13,472 million net profit,
respectively, a year ago. Wrote off Yen
6,388 million extraordinary losses for NC’s account. Profits deteriorated in all segments due to rising costs for raw
materials & fuel, and exchange rate fluctuations.
(Apr/Sept/2008 results): Sales
Yen 202,471 million (down 5.1%), operating profit Yen 9,690 million (down
30.4%), recurring profit Yen 7,047 million (down 36.8%), net losses Yen 5,320
million (down from Yen 5,546 million net profits). The profit deterioration is
referred to harsh competition due to market lull of flat-panel display. Airbags rose by wider use.
For the current term ending Apr
2009 the firm revised down earlier projections (made in Aug/2008) on
05/Nov/2008 to (earlier projections in parenthesis): Sales Yen 400,000 million
(Yen 410,000 million), operating profit Yen 20,000 million (Yen 20,000
million), recurring profit Yen 15,000 million (Yen 15,000 million), net losses
Yen 5,000 million (Yen 1,000 million net profit). The net losses are referred to the restructuring expenses of
acrylic textiles, and liquidation special losses on subs. The net losses are for one-off term only,
the firm says. In non-textiles,
functional materials for automobile showing firm tone, but films falling short
of targets.
The financial situation is considered FAIR and good for ORDINARY business engagements. Max credit limit is estimated at Yen 8,455.9 million, on 30 days normal terms.
REGISTRATION
Date Registered: Jun 1914
Legal Status:
Limited Company (Kabushiki Kaisha)
Authorized:
2,000 million shares
Issued:
699,027,598 shares
Sum: Yen 43,341 million
Major shareholders (%)
Japan Trustee Services T (4.1),
Master Trust Bank of Japan T (3.7),
Nippon Life Ins (2.9), Mizuho Corporate Bank (1.9), MUFG (1.8), SMBC (1.8),
Toyukai (1.7), Meiji Yasuda Life Ins (1.6), Chuo Mitsui Trust Bank (1.2), Japan
Trustee Services T4 (1.2); foreign owners (8.2)
No. of
shareholders: 84,746
Listed
on the S/Exchange (s) of: Tokyo, Osaka
Managements
Junji Tsumura, ch; Ryuzo
Sakamoto, pres; Masahiko Hachimaru, s/mgn dir; Fumishige Imamura, s/mgn dir;
Kenji Hayashi, mgn dir; Kazuyuki Yabuki, mgn dir; Kanji Aono, mgn dir; Fumiaki
Miyoshi, dir; Hiroyuki Kagawa, dir; Kazuo Kurita, dir
Nothing detrimental is known as to the commercial morality
of executives.
Related companies
Kureha Tech, Japan Exlan Co Ltd,
Shinko Trading, Toyocloth Co, other.
OPERATION
Activities: Spinning company:
(Sales breakdown by
Divisions):
Films & Functional Resins Div (31%): industrial films for LCD & optical use, other industrial uses, synthetic paper, PET films for food packaging, engineering plastics, industrial adhesives, coatings, photo sensitive printing papers, acrylate polymers, electronic materials, rubber processing, coat processing;
Industrial Materials Div (18%): airbag fabrics, polyester for tire cords, ultrahigh-molecular-weight polyethylene fiber, extreme heat-resistant, high tenacity fibers,
Life Science Div (8%): bio-products (enzymes for diagnostics, diagnostic systems, reagents for research, contract mfg of pharmaceuticals, injection, intermediates, raw pharmaceuticals, medical membranes, equipment & devices (artificial kidney hollow fiber, anti-clothing materials), water treatment membranes (seawater desalination modules);
Apparel & Textiles Div (33%): functional textiles (for sports clothing, underwear, uniforms), apparel mfg (Munshingwear), synthetic filaments, acrylic fibers, others;
Other Div (10%);
Overseas Trading Ratios (19.7%): S/E Asia 12.9%, Other region 5.3%.
Clients
[Wholesalers, mfrs] Itochu Corp, Marubeni Corp, Mitsui &
Co, other.
No. of accounts: 2,000
Domestic areas of activities:
Nationwide
Suppliers
[Mfrs, wholesalers] Sumitomo
Chemical Ind, Nippon Shokubai, Marubeni Corp, other.
Payment
record: Regular
Location: Business
area in Osaka. Office premises at the
caption address are owned and maintained satisfactorily.
Bank References
Mizuho Corporate Bank (H/O)
MUFG (Osaka)
Relations: Satisfactory
FINANCIALS
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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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431,417 |
426,666 |
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Cost of Sales |
342,506 |
335,369 |
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GROSS PROFIT |
88,911 |
91,297 |
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Selling & Adm Costs |
61,836 |
60,862 |
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OPERATING PROFIT |
27,075 |
30,435 |
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Non-Operating P/L |
-6,026 |
-5,093 |
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RECURRING PROFIT |
21,049 |
25,342 |
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NET PROFIT |
4,698 |
13,472 |
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BALANCE SHEET |
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Cash |
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10,025 |
14,470 |
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Receivables |
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84,296 |
90,730 |
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Inventory |
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86,215 |
92,092 |
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Securities, Marketable |
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Other Current Assets |
19,108 |
15,593 |
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TOTAL CURRENT ASSETS |
199,644 |
212,885 |
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Property & Equipment |
236,299 |
230,885 |
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Intangibles |
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2,656 |
2,870 |
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Investments, Other Fixed Assets |
55,897 |
66,551 |
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TOTAL ASSETS |
494,496 |
513,191 |
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Payables |
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66,142 |
62,793 |
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Short-Term Bank Loans |
64,675 |
77,436 |
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Other Current Liabs |
81,543 |
63,228 |
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TOTAL CURRENT LIABS |
212,360 |
203,457 |
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Debentures |
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20,000 |
20,000 |
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Long-Term Bank Loans |
57,815 |
64,983 |
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Reserve for Retirement Allw |
15,104 |
18,355 |
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Other Debts |
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42,717 |
54,173 |
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TOTAL LIABILITIES |
347,996 |
360,968 |
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MINORITY INTERESTS |
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Common
stock |
43,341 |
43,341 |
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Additional
paid-in capital |
16,033 |
16,033 |
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Retained
earnings |
29,754 |
28,131 |
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Evaluation
p/l on investments/securities |
2,110 |
8,909 |
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Others |
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55,529 |
56,045 |
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Treasury
stock, at cost |
(267) |
(235) |
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TOTAL S/HOLDERS` EQUITY |
146,500 |
152,224 |
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TOTAL EQUITIES |
494,496 |
513,191 |
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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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23,282 |
27,064 |
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Cash
Flows from Investment Activities |
-10,193 |
-2,925 |
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Cash
Flows from Financing Activities |
-17,948 |
-22,439 |
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Cash,
Bank Deposits at the Term End |
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9,749 |
14,140 |
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ANALYTICAL RATIOS Terms
ending: |
31/03/2008 |
31/03/2007 |
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Net
Worth (S/Holders' Equity) |
146,500 |
152,224 |
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Current
Ratio (%) |
94.01 |
104.63 |
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Net
Worth Ratio (%) |
29.63 |
29.66 |
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Recurring
Profit Ratio (%) |
4.88 |
5.94 |
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Net
Profit Ratio (%) |
1.09 |
3.16 |
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Return
On Equity (%) |
3.21 |
8.85 |
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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. |
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UK Pound |
1 |
Rs. |
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Euro |
1 |
Rs. |
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%)