MIRA INFORM REPORT

 

 

Report Date :

17.12.2012

 

IDENTIFICATION DETAILS

 

Name :

KYOKUTO BOEKI KAISHA LTD

 

 

Registered Office :

New Ohtemachi Bldg 7F, 2-2-1 Ohtemachi Chiyodaku Tokyo 100-0004

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2012

 

 

Date of Incorporation :

November, 1947

 

 

Reg. No.:

014327

 

 

Legal Form :

Limited Company

 

 

Line of Business :

Import, export, wholesale of industrial machinery

 

 

No. of Employees :

323

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

RATING

STATUS

PROPOSED CREDIT LINE

41-55

Ba

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

Satisfactory

 

Status :

Satisfactory

Payment Behaviour :

No Complaints

Litigation :

Clear

 

 

NOTES :

Any query related to this report can be made on e-mail: infodept@mirainform.com while quoting report number, name and date.

 

ECGC Country Risk Classification List – June 30th, 2012

 

Country Name

Previous Rating

(31.03.2011)

Current Rating

(30.06.2012)

Japan

A1

A1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

 

 

japan - ECONOMIC OVERVIEW

 

In the years following World War II, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan develop a technologically advanced economy. Two notable characteristics of the post-war economy were the close interlocking structures of manufacturers, suppliers, and distributors, known as keiretsu, and the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding under the dual pressures of global competition and domestic demographic change. Japan's industrial sector is heavily dependent on imported raw materials and fuels. A tiny agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. Usually self-sufficient in rice, Japan imports about 60% of its food on a caloric basis. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the global catch. For three decades, overall real economic growth had been spectacular - a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the after effects of inefficient investment and an asset price bubble in the late 1980s that required a protracted period of time for firms to reduce excess debt, capital, and labor. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, Japan in 2011 stood as the fourth-largest economy in the world after second-place China, which surpassed Japan in 2001, and third-place India, which edged out Japan in 2011. A sharp downturn in business investment and global demand for Japan's exports in late 2008 pushed Japan further into recession. Government stimulus spending helped the economy recover in late 2009 and 2010, but the economy contracted again in 2011 as the massive 9.0 magnitude earthquake in March disrupted manufacturing. Electricity supplies remain tight because Japan has temporarily shut down almost all of its nuclear power plants after the Fukushima Daiichi nuclear reactors were crippled by the earthquake and resulting tsunami. Estimates of the direct costs of the damage - rebuilding homes, factories, and infrastructure - range from $235 billion to $310 billion, and GDP declined almost 0.5% in 2011. Prime Minister Yoshihiko NODA has proposed opening the agricultural and services sectors to greater foreign competition and boosting exports through membership in the US-led Trans-Pacific Partnership trade talks and by pursuing free-trade agreements with the EU and others, but debate continues on restructuring the economy and reining in Japan's huge government debt, which exceeds 200% of GDP. Persistent deflation, reliance on exports to drive growth, and an aging and shrinking population are other major long-term challenges for the economy.

 

Source : CIA

 

Company name

 

KYOKUTO BOEKI KAISHA LTD

 

 

REGD NAME

 

Kyokuto Boeki KK

 

 

MAIN OFFICE

 

New Ohtemachi Bldg 7F, 2-2-1 Ohtemachi Chiyodaku Tokyo 100-0004 JAPAN

Tel: 03-3244-3511     Fax: 03-3246-2148

 

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

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

 

 

ACTIVITIES  

 

Import, export, wholesale of industrial machinery

 

 

BRANCHES   

 

Sapporo, Nagoya, Osaka, Chiba, Hiroshima, Fukuoka, other (Tot 14)

 

 

OVERSEAS

 

Taipei, China (5), USA (2), Germany, India, France

 

CHIEF EXEC:    AKIRA HIROSAKA, PRES

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY

 

FINANCES        FAIR                             A/SALES          Yen 38806 M

PAYMENTS      NO COMPLAINTS          CAPITAL           Yen 5,030 M

TREND             SLOW                           WORTH            Yen 10,867 M

STARTED         1947                             EMPLOYES      323

 

 

COMMENT

 

TRADING HOUSE SPECIALIZING IN INDUSTRIAL MACHINERY. 

FINANCIAL SITUATION COSIDERED FAIR AND GOOD FOR ORDINARY

BUSINESS ENGAGEMENTS.

                       

 

Notes: Unit: In Million Yen

Forecast (or estimated) figures for 31/03/2013 fiscal term

 

 

HIGHLIGHTS

 

The subject company was established by employees (machinery & trade division) of former Mitsui & Co Ltd, following that company’s dissolution by the Zaibatsu (financial combine) dissolution laws.  Since then the firm has developed into specialized trading house of industrial machinery, offering engineering & technical support services.  This is a trading firm for import, export and wholesale of industrial machinery, aircraft-related machinery & equipment, plant facilities, other.  Electric machinery made by Toshiba-affiliated firms and industrial machinery by IHI Corp are mainline.  Maintains top share in boiler controller field.  Technical staff accounts for over 60% of total employees.  Strong in sales to public sector & steelmakers.  Eager to advance into Brazil mainly in automobile-related products.  The company will expand the spring subsidiary’s sales routes through company-wide collaboration.  It will add process evaluation to the complete performance-based staff evaluation system, aiming to promote new business development.

 

 

FINANCIAL INFORMATION

 

The sales volume for Mar/2012 fiscal term amounted to Yen 38,806 million, a 7.2% down from Yen 41,828 million in the previous term.  Sales declined.  Steel industries were slow to revive.  Global economic downturn affected the sales particularly in the first half of the term.  Yen’s appreciation hurt export revenues & profits in Yen terms.  The recurring profit was posted at 258 million and the net losses at Yen 604 million, respectively, compared with Yen 726 million recurring profit and Yen 494 million net profit, respectively, a year ago. 

 

(Apr/Sept/2012 results): Sales Yen 21,375 million (up 26.9%), operating loss Yen 31 million (previously Yen 25 million loss), recurring profit Yen 67 million (down 44.6%), net loss Yen 230 million (previously Yen 219 million profits).  (% & figures compared with the corresponding period a year ago). 

 

For the current term ending Mar 2013 the recurring profit is projected at Yen 700 million and the net profit at Yen 400 million, respectively, on a 10.8% rise in turnover, to Yen 43,000 million. Heavy electric machinery sales volume will surpass the expectations, but profit contribution is limited.  The spring subsidiary acquired in the previous term will fully contribute.  Sales of lucrative resource development equipment and aircraft electronics will benefit from robust orders delayed from the previous term, offsetting sluggish semiconductor sales.  Operating profit will rebound, despite a bad debt booked as an SGA expense.  Extraordinary loss on the lawsuit settlement will be absent.  

 

The financial situation is considered FAIR and good for ORDINARY business engagements.  Max credit limit is estimated at Yen 980.6 million, on 30 days normal terms. 

 

 

REGISTRATION

           

Date Registered:　    Nov 1947

Regd No.:                    (Tokyo-Chiyodaku) 014327

Legal Status:                 Limited Company (Kabushiki Kaisha)

Authorized:                   100 million shares

Issued:                         27,899,592 shares

Sum:                            Yen 5,030 million

           

Major shareholders (%): IHI Corp (6.9), Japan Trustee Services T (5.3), Company’s Treasury Stock (4.0), MUFG (3.5), SMBC (3.5), Mitsui Sumitomo Ins (3.2), Nireco Corp (2.7), Customers’ S/H Assn (1.9), CBNYDFA Int’l Cap Value P (1.7), TMEIC (1.7); foreign owners (3.1)

           

No. of shareholders: 3,115

 

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

 

Managements: Akira Hirosaka, pres; Akira Amemiya, v pres; Shigetoshi Kimura, mgn dir; Jun’ichi Mito, mgn dir; Toshifumi Takei, dir, Tadashi Yoshikawa, dir; Toshiji Saito, dir

 

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

 

Related companies: Nippon System Industries Corp, KBK Inc, KBK Europe GmbH, KBK Trading (Shanghai) Co Ltd, KBK Trading (India), other.

 

 

OPERATION

           

Activities: Trading house for import, export and wholesale of industrial machinery:

 

(Sales Breakdown by Divisions):

 

Electric Machinery & Energy-related (32%): machinery, tools, materials, instruments, meters, vessels & ships, vehicles, metal products, chemicals, gunpowder & explosives, foods, fabrics & related products, medical supplies, medical appliances, other;

Electronics & Aircraft-related (29%): aircraft & aerospace equipment & parts, computer & parts, power generation facilities, instrumentation controls/monitoring instruments & parts, bridge construction, boilers, turbines, telecommunications facilities, water treatment equipment, air pollution analyzers & their anti-pollution devices, natural resource exploration/analysis & drilling & their parts & equipment, liquor products, drinking water;

General Industry-related (39%): Repair/maintenance services of plant facilities/equipment in above products, computer system technologies & software, data processing & provision by computers, advertizing, general leasing, contracting, transportation, indemnity insurance agency, other.

Overseas Sales Ratio (21%): 

           

 

Clients: [Mfrs, wholesalers] Mitsubishi Heavy Ind, Defense Ministry, IHI Corp, Nippon Steel, Hokkaido Electric Power, JFE Steel, Toray Ind, China Shougang Int’l Trade & Engineering, other

            No. of accounts: 1,000

            Domestic areas of activities: Nationwide

Suppliers: [Mfrs, wholesalers] IHI Corp, Toshiba Corp, ABB Bailey Japan, Toshiba Corp, Toshiba Mitsubishi Industrial System Co, Fujikura Kasei Co, other

 

Payment record: No Complaints

 

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

 

Bank References:

MUFG (Shin-Marunouchi)

SMBC (Tokyo-Chuo)

Relations: Satisfactory

 

 

FINANCES

 

 (In Million Yen)

FINANCES: (Consolidated in million yen)

　

　

Terms Ending:

31/03/2012

31/03/2011

INCOME STATEMENT

  Annual Sales

　

38,806

41,828

  Cost of Sales

34,021

36,824

      GROSS PROFIT

4,784

5,004

  Selling & Adm Costs

4,687

4,467

      OPERATING PROFIT

96

536

  Non-Operating P/L

162

190

      RECURRING PROFIT

258

726

　

      NET PROFIT

-604

494

BALANCE SHEET

  Cash

　

3,819

2,415

  Receivables

14,451

12,997

  Inventory

2,265

1,229

  Securities, Marketable

27

　

  Other Current Assets

1,436

1,583

      TOTAL CURRENT ASSETS

21,998

18,224

  Property & Equipment

1,499

468

  Intangibles

1,103

520

  Investments, Other Fixed Assets

6,819

7,610

      TOTAL ASSETS

31,419

26,822

  Payables

11,665

9,905

  Short-Term Bank Loans

4,343

1,748

　

　

　

  Other Current Liabs

1,736

1,274

      TOTAL CURRENT LIABS

17,744

12,927

  Debentures

300

600

  Long-Term Bank Loans

1,311

701

  Reserve for Retirement Allw

922

825

  Other Debts

　

275

262

      TOTAL LIABILITIES

20,552

15,315

      MINORITY INTERESTS

Common stock

5,030

5,030

Additional paid-in capital

4,630

4,630

Retained earnings

1,942

2,654

Evaluation p/l on investments/securities

(49)

(102)

Others

(343)

(364)

Treasury stock, at cost

(343)

(342)

      TOTAL S/HOLDERS` EQUITY

10,867

11,506

　

      TOTAL EQUITIES

31,419

26,822

CONSOLIDATED CASH FLOWS

Terms ending:

31/03/2012

31/03/2011

Cash Flows from Operating Activities

　

-340

6

Cash Flows from Investment Activities

-1,155

-489

Cash Flows from Financing Activities

2,779

-161

　

Cash, Bank Deposits at the Term End

　

3,519

2,205

ANALYTICAL RATIOS            Terms ending:

31/03/2012

31/03/2011

Net Worth (S/Holders' Equity)

10,867

11,506

Current Ratio (%)

123.97

140.98

Net Worth Ratio (%)

34.59

42.90

Recurring Profit Ratio (%)

0.66

1.74

Net Profit Ratio (%)

-1.56

1.18

Return On Equity (%)

-5.56

4.29

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.54.39

UK Pound

1

Rs.87.78

Euro

1

Rs.71.29

 

 

INFORMATION DETAILS

 

Report Prepared by :

SDA

 

 

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

Capability to overcome financial difficulties seems comparatively below average.

 

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

--

NB

New Business

 

--

 

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

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.