MIRA INFORM REPORT

 

 

Report Date :           

02.06.2012

 

IDENTIFICATION DETAILS

 

Name :

TSUTSUMI JEWELRY CO LTD

 

 

Registered Office :

4-24-26 Chuo Warabi City Saitama-Pref 335-0004

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2011

 

 

Date of Incorporation :

June 1973

 

 

Com. Reg. No.:

0300-01-021115 (Saitama-Warabi)

 

 

Legal Form :

Limited Company

 

 

Line of Business :

Manufacturer, retail, wholesale of jewelry

 

 

No. of Employees :

1,213

 

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 :

Good

 

 

Payment Behaviour :

No Complaints

 

 

Litigation :

---

 

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 – March 31st, 2012

 

Country Name

Previous Rating

(31.12.2011)

Current Rating

(31.03.2012)

Japan

a1

a1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

Company name

 

TSUTSUMI JEWELRY CO LTD

 

 

REGD NAME

 

KK Tsutsumi

 

 

MAIN OFFICE

 

4-24-26 Chuo Warabi City Saitama-Pref 335-0004 JAPAN

Tel: 048-431-5111     Fax: 048-431-5524

 

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

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

 

 

ACTIVITIES  

 

Mfg, retail, wholesale of jewelry

 

 

STORE(S)

 

Tokyo (41), Saitama (29), Kanagawa (20), Chiba (19), others (Tot 179)

 

 

FACTORIES

 

At the caption address (2), Gunma

 

 

CHIEF EXEC

 

SATOSHI TAGAI, PRES

 

Yen Amount:     In million Yen, unless otherwise stated

 

SUMMARY

 

FINANCES        FAIR                             A/SALES          Yen 26,296 M

PAYMENTS No Complaints   CAPITAL           Yen 13,098 M

TREND SLOW                          WORTH            Yen 73,869 M

STARTED         1973                             EMPLOYES      1,213

 

 

COMMENT    

 

MFR, RETAILER & WHOLESALER SPECIALIZING IN JEWELRY. 

           

FINANCIAL SITUATION CONSIDERED FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.

 

                        *.. Unit: Million Yen

Forecast (or estimated) figures for 31/03/2012 fiscal term

 

 

HIGHLIGHTS

 

The subject company was established by Seiji Tsutsumi originally as Tsutsumi Precious Metals & Crafts Co Ltd, and renamed as captioned in 1988.  This is an integrated jewelry company with a fully combined production & distribution system: from gem purchasing to jewelry mfg, retailing & wholesaling.  A major retailer of jewelry & precious metals, operating a total 179 outlets, more than 100 directly-run stores centrally in the greater-Tokyo region.  With start-up of product management center in Mar 1997, escalating new products development efforts and reducing inventory risks.  Known for quick response to market needs and immediately reflects them in designs & processing.  ^95% of the products are retailed at its own stores, with 5% wholesaled to department stores, chain stores, jewelry stores, other.  Integrating wallpaper production firms under 2 firms aimed at efficient structure.  In Dec 2000, founded Tsutsumi Scholarship Foundation.  The company plans to open its first store in Tokushima offering limited products and daily discount sales, and focus also on online sales.  It should actively recruit contract staff with the aim of expanding the store network.  It plans to open 6 outlets in the Mar 2012 term. 

           

 

FINANCIAL INFORMATION

 

The sales volume for Mar/2011 fiscal term amounted to Yen 26,296 million, a 2.0% up from Yen 25,789 million in the previous term.  Consumer spending came back to normal, despite concerned fears for unemployment and less earnings.  5 new stores opened, 12 stores refurbished & enlarged, while 5 stores closed.  By items, Rings up 3.5% to Yen 9,257 million, Necklace & Bracelets down 2.2% to Yen 8,900 million; and Personal goods up 1.1% to Yen 4,089 million.  The operating profit was posted at Yen 2,479 million (down 26.3%), recurring profit at Yen 2,658 million (down 26.7%) and the net profit at Yen 1,448 million (down 21.3%).  (% compared with same period a year ago). 

 

(Apr/Dec/2011 results): Sales Yen 24,081 million (up 19.3%), operating profit Yen 2,861 million (up 23.7%), recurring profit Yen 2,952 million (up 22.5%), net profit Yen 1,612 million (up 20.5%).  (% compared with the corresponding period a year ago).

For the current term ending Mar 2012 the recurring profit is projected at Yen 3,500 million and the net profit at Yen 1,800 million, respectively, on a 14.8% rise in turnover, to Yen 30,200 million.  Store openings will be six and closures zero, compared with 5 each in the preceding term.  Consumer numbers and per-customer spending at existing stores are surpassing the previous term.  Coin sales are higher than expected as a result of the ore market upsurge.  As consumer spending recovers from the slump following the earthquake last March, one trend is clear: More Japanese are opening up their wallets for leisure and luxury spending, while skimping on daily household expenses.

The financial situation is considered maintained FAIR and good for ORDINARY business engagements. 

 

REGISTRATION

           

Date Registered:  Jun 1973

Regd No.:         0300-01-021115 (Saitama-Warabi)

Legal Status:      Limited Company (Kabushiki Kaisha)

Authorized:         40 million shares

Issued:                20,080,480 shares

Sum:                   Yen 13,098 million

 

 

Major shareholders (%): Seiji Tsutsumi (48.4), Shizuko Tsutsumi (6.3), Tsutsumi Scholarship Found (4.9), State Street Bank & Trust (3.9), CBNYDFA Int’l Cap Value P (3.9), Japan Trustee Services T (2.5), State Street Bank & Trust 505044 (1.7), State Street Bank & Trust 505103 (1.4), JP Morgan Chase Bank 385166 (1.3), CBNYDFA Int’l Corp Value P (1.3); foreign owners (25.7)

 

No. of shareholders: 2,608

 

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

 

Managements: Seiji Tsutsumi, ch; Satoshi Tagai, pres; Keizo Fujieda, v pres; Katsumi Shindo, dir; Katsumi Okano, dir; Takashi Tsuji, dir; Mitsuo Ohtomo; dir; Koji Shidatsu, dir; Atsuhide Mizutani, dir

 

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

 

                       


OPERATION

 

Activities: Retails & wholesales jewelry, operating a total 179 jewelry chain stores centrally in greater-Tokyo regions:

 

(Sales breakdown by divisions): Rings (35%), necklaces & bracelets (34%), personal     goods (16%), others (15%). 

Retail (95%); wholesale (5%).  Goods are imported through trading houses.

 

Clients: Consumers, department stores, jewelry stores, chain stores, supermarkets, other

            No. of accounts: Unavailable

            Domestic areas of activities: Nationwide

 

Suppliers: [Mfrs, wholesalers] Marubeni Corp, Sumitomo Materials, Sojitz Corp, etc. Imports from: USA, Belgium, Israel, India & Thailand.

 

Payment record: No Complaints

 

Location: Business area in Warabi City, Saitama-Pref.  Office premises at the caption address are owned and maintained satisfactorily.

 

Bank References:

SMBC (Akabane)

MUFG (Warabi)

Relations: Satisfactory

 

 

FINANCES

(In Million Yen)

 

FINANCES: (Consolidated in million yen)

 

　

　

Terms Ending:

31/03/2011

31/03/2010

INCOME STATEMENT

 

 

 

  Annual Sales

　

26,296

25,789

 

  Cost of Sales

12,834

12,405

 

      GROSS PROFIT

13,462

13,384

 

  Selling & Adm Costs

10,631

10,905

 

      OPERATING PROFIT

2,831

2,479

 

  Non-Operating P/L

121

179

 

      RECURRING PROFIT

2,952

2,658

　

      NET PROFIT

1,617

1,448

BALANCE SHEET

 

 

 

 

  Cash

　

35,747

34,407

 

  Receivables

 

1,068

1,425

 

  Inventory

 

19,654

19,044

 

  Securities, Marketable

　

　

 

  Other Current Assets

592

559

 

      TOTAL CURRENT ASSETS

57,061

55,435

 

  Property & Equipment

13,050

13,216

 

  Intangibles

 

596

607

 

  Investments, Other Fixed Assets

5,391

5,703

 

      TOTAL ASSETS

76,098

74,961

 

  Payables

 

220

151

 

  Short-Term Bank Loans

　

　

 

　

 

　

　

 

  Other Current Liabs

1,831

1,825

 

      TOTAL CURRENT LIABS

2,051

1,976

 

  Debentures

 

　

　

 

  Long-Term Bank Loans

　

　

 

  Reserve for Retirement Allw

143

132

 

  Other Debts

　

35

35

 

      TOTAL LIABILITIES

2,229

2,143

 

      MINORITY INTERESTS

 

 

 

Common stock

13,098

13,098

 

Additional paid-in capital

15,707

15,707

 

Retained earnings

45,000

43,904

 

Evaluation p/l on investments/securities

78

123

 

Others

 

2

1

 

Treasury stock, at cost

(16)

(15)

 

      TOTAL S/HOLDERS` EQUITY

73,869

72,818

　

      TOTAL EQUITIES

76,098

74,961

CONSOLIDATED CASH FLOWS

 

 

 

 

Terms ending:

31/03/2011

31/03/2010

 

Cash Flows from Operating Activities

　

1,863

2,124

 

Cash Flows from Investment Activities

0

-415

 

Cash Flows from Financing Activities

-522

-522

　

Cash, Bank Deposits at the Term End

　

35,747

34,407

ANALYTICAL RATIOS            Terms ending:

31/03/2011

31/03/2010

 

 

Net Worth (S/Holders' Equity)

73,869

72,818

 

 

Current Ratio (%)

2782.11

2805.41

 

 

Net Worth Ratio (%)

97.07

97.14

 

 

Recurring Profit Ratio (%)

11.23

10.31

 

 

Net Profit Ratio (%)

6.15

5.61

 

 

Return On Equity (%)

2.19

1.99

 

           

 

DIAMOND INDUSTRY – INDIA

 

-          From time immemorial, India is well known in the world as the birthplace for diamonds.  It is difficult to trace the origin of diamonds but history says that in the remote past, diamonds were mined only in India. Diamond production in India can be traced back to almost 8th Century B.C.  India, in fact, remained undisputed leader till 18th Century when Brazilian fields were discovered in 1725 followed by emergence of S. Africa, Russia and Australia.

-          The achievement of the Indian diamond industry was possible only due to combination of the manufacturing skills of the Indian workforce and the untiring and unflagging efforts of the Indian diamantaires, supported by progressive Government policies.

-          The area of study of family owned diamond businesses derives its importance from the huge conglomerate of family run organizations which operate in the diamond industry since many generations.

-          Some of the basic traits of family run business enterprises include spirit of entrepreneurship, mutual trust lowers transaction costs, small, nimble and quick to react, information as a source of advantage and philanthropy.

-          Family owned diamond businesses need to improve on many fronts including higher standard of corporate governance, long-term performance – focused strategies, modern management and technology.

-          The diamond jewellery industry in India today may be more than Rs 60000 mil and is rated amongst the fastest growing  in the world. Indi ranks third in the world in domestic diamond consumption.

-          Utmost caution is to be exercised while dealing with some medium and large diamond traders which are usually engaged in fictitious import – export, inter-company transactions, financially assisted by banks. In the process, several public sector banks lost several hundred million rupees. They mostly diverted borrowed money for diamond business into real estate and capital markets.

-          Excerpts from Times of India dated 30th October 2010 is as under –

 

DIAMOND SAGA – DIRTY DOZEN STUCK WITH 2K CR DEBT

 

This could be the biggest credibility crisis the Indian diamond industry has ever faced. Fifteen banks run the risk of losing Rs 2000 crore lent to a dozen diamond firms in Surat. Until about two months ago, they had not repaid  these dues. Bankers believe many diamantaires borrowed money during the economic downturn two years ago and diverted funds to businesses like real estate and capital markets. Many of themselves made money from these businesses but their diamond companies have gone sick and declared insolvency.

-          Most of the money borrowed from the banks in the name of their diamond business has been diverted in real estate and the share market. The banks are not in a position to seize their properties because in many cases, these were purchased in the name of their relatives and friends.

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.55.92

UK Pound

1

Rs.86.03

Euro

1

Rs.69.13

 

INFORMATION DETAILS

 

Report Prepared by :

MNL

 

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.