MIRA INFORM REPORT

 

 

Report Date :

04.10.2013

 

IDENTIFICATION DETAILS

 

Name :

FURUKAWA ELECTRIC CO LTD

 

 

Registered Office :

Marunouchi Naka-Dori Bldg, 2-2-3 Marunouchi Chiyodaku Tokyo 100-8382

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2013

 

 

Date of Incorporation :

June 1896

 

 

Com. Reg. No.:

0100-01-008795 (Tokyo-Chiyodaku)

 

 

Legal Form :

Limited Company (Kabushiki Kaisha)

 

 

Line of Business :

Manufacturer of electric wires & cables

 

 

No. of Employees :

50,342

 

RATING & COMMENTS

 

MIRA’s Rating :

A

 

RATING

STATUS

PROPOSED CREDIT LINE

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

 

Status :

Good

Payment Behaviour :

Regular

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 – March 31st, 2013

 

Country Name

Previous Rating

(31.12.2012)

Current Rating

(31.03.2013)

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 small agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. While self-sufficient in rice production, Japan imports about 60% of its food on a caloric basis. 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. Modest economic growth continued after 2000, but the economy has fallen into recession three times since 2008. A sharp downturn in business investment and global demand for Japan's exports in late 2008 pushed Japan 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 and the ensuing tsunami in March disrupted manufacturing. The economy has largely recovered in the two years since the disaster, but reconstruction in the Tohoku region has been uneven. Newly-elected Prime Minister Shinzo ABE has declared the economy his government's top priority; he has pledged to reconsider his predecessor's plan to permanently close nuclear power plants and is pursuing an economic revitalization agenda of fiscal stimulus and regulatory reform and has said he will press the Bank of Japan to loosen monetary policy. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, Japan in 2012 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 2012. The new government will continue a longstanding debate 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 and address

 

FURUKAWA ELECTRIC CO LTD

 

REGD NAME:   Furukawa Denki Kogyo KK

MAIN OFFICE:  Marunouchi Naka-Dori Bldg, 2-2-3 Marunouchi Chiyodaku Tokyo 100-8382 JAPAN

Tel: 03-3286-3001    

Fax: 03-3286-3694-

 

URL:                 http://www.firilawa/cp/kp

E-Mail address: (thru the URL)

 

 

ACTIVITIES  

 

Mfg of electric wires & cables

 

 

BRANCHES   

 

Tokyo, China, Osaka, Nagoya, Yokohama, Fukuoka, other (tot 14)

 

OVERSEAS

 

Thailand (8), China (15), Malaysia (2), India (2), Indonesia, Philippines,

Vietnam, use, Mexico, Taiwan, other

 

 

FACTORIES  

 

Chiba, Nikko, Hiratsuka, Mie, Yokohama, Osaka

 

 

CHIEF EXEC 

 

MITSUYOSHI SHIBATA, PRES

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY    

 

FINANCES        FAIR                 　A/SALES       Yen 924,717 M

                       

PAYMENTSREGULAR   　CAPITAL        Yen 69,395 M

TREND UP                    　WORTH         Yen 222,843 M

                       

STARTED         1896                 　EMPLOYES   50,342

 

 

 

COMMENT    

 

MFG OF ELECTRIC WIRES & CABLES 

FINANCIAL SITUATION COSIDERED FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.

 

           

                        Unit: In Million Yen

Forecast figures for the 31/03/2014M fiscal term.

 

 

HIGHLIGHTS

 

This is one of the largest mfrs of electric wires & cables.  Advanced into rolled copper business in 1934 and grew into comprehensive nonferrous metal maker.  Presently optical fiber cables major earnings source.  Stressing copper foils.  The company’s strategy focusing on high-function materials such as HDD glass substrates came to a deadlock.  From now on, the make of electric wires & cables may lay stress on its original forte and peripheral products, including optical fibers bound for overseas, industrial-use electric wires and harnesses.  The subsidiary, Furukawa-Sky Aluminum will merge with Sumitomo Light Metals in Oct/2013, and the aluminum division will separate.  The firm plans to set up plants to manufacture parts relating to airbags in Brazil and India with the start of operation slated for the March/2015 term.

 

 

FINANCIAL INFORMATION

 

The sales volume for Mar 2013 fiscal term amounted to Yen 924,717 million, a 0.6% up  from Yen 918,808 million in the previous term.  Sales of electrical and electronic equipment for automobile expanded.  In the second half, 15-month account settlements of seven overseas firms were added.  The recurring profit was posted at Yen 17,612 million and the net profit at Yen 3,576 million, respectively, compared with Yen 12,872 million recurring profit and Yen 11,123 million net losses, respectively, a year ago. 

 

(Apr/Jun/2013 results): Sales Yen 236,840 million (up 6.3%), operating profit Yen 5,276 million (up 43.9%), recurring profit yen 6,842 million (up 91.2%), net profit Yen 1,344 million (up 139.8%).  (% compared with the corresponding period a year ago).

           

For the current term ending Mar 2014 the recurring profit is projected at Yen 24,000 million and the net profit at Yen 5,000 million, on a 1.7% rise in turnover, to Yen 940,000 million.  Demand for optical fibers will recover in emerging nations.  Sales of electrical equipment, including automobile-use harnesses, will also expand.  In addition to good results of consolidations of bases, a weaker will back up profit growth.  

 

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

 

 

REGISTRATION

           

     Date Registered:      　Jun 1896

     Regd No.:                    0100-01-008795 (Tokyo-Chiyodaku)

Legal Status:       Limited Company (Kabushiki Kaisha

Authorized:                   2,590,000,000 shares

Issued:                706,669,179 shares

Sum:                   Yen 69,395 million

 

Major shareholders (%): Japan Trustee Services T (5.6), Master Trust Bank of Japan T (5.1), Japan Trustee Services T4 (3.9), TCSB (Mizuho Bank (3.2), Japan Trustee Services T9 (2.4), Asahi Life Ins (2.2), Furukawa Co (1.8), SSBT OD05 Omnibus Acct Treaty (1.7), Fuji Electric (1.5), TCSB (Furukawa Co) (1.5; foreign owners (14.8)

 

No. of shareholders: 65,608

 

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

 

Managements: Masao Yoshida, ch; Mitsuyoshi Shibata, pres; Sumitaka Fujita, dir; Nobuyoshi Soma, dir; Osamu Tsukamoto, dir; Hideo Sakura, dir

 

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

 

Related companies: Furukawa Battery, Furukawa Sky, OFS, Riken Electric Wire,

Furukawa AS, other

 

 

OPERATION

           

Activities: Manufactures electric wire & cables:

 

(Sales Breakdown by divisions):

Telecommunications ( (15%): optical fibers & cables, semiconductor optical devices, optical components, optical fiber cable accessories & installations, metal communication cables, electronic appliance wires, network equipment, CATV system, radio products, etc;

Electronics & Automotive Systems (25%): automotive components & electric wiring, magnet wires, heat-sinks, memory disc materials, antennas, electronic component materials, battery products, etc;

Energy & Industrial Products (26%): bare wires, aluminum wires, insulated wires, power cable, power transmission cable accessories & installation, electric material products, cable conduits, fire prevention products, water-feeding pipe materials, foam products, UV tapes for semiconductor mfg, etc;

Metals others (35%): wrought copper products (plates, strips, pipes, rods & wires), functional surface products, electrodeposited copper oil, processed products for electronic parts, superconducting products, special metal materials, special metal materials, shape-memory & super-elastic alloys, aluminum sheets, extruded aluminum products, processed light metal products, etc;

Overseas sales ratio (37%)

 

Clients: [Mfrs, wholesalers] Japan Railways, NTT, Electric Powers, Government Agencies,           other

No. of accounts: 800

Domestic areas of activities: Nationwide

Suppliers: [Mfrs, wholesalers] Itochu Corp, Mitsui & Co, Mitsubishi Corp, other

 

Payment record: Regular

 

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

 

Bank References:

Mizuho Corporate Bank (H/O)

MUFG (H/O)

Relations: Satisfactory

 

 

FINANCES

 

(In Million Yen)

FINANCES: (Consolidated in million yen)

 

　

　

Terms Ending:

31/03/2013

31/03/2012

INCOME STATEMENT

 

 

 

  Annual Sales

　

924,717

918,808

 

  Cost of Sales

786,825

786,952

 

      GROSS PROFIT

137,891

131,856

 

  Selling & Adm Costs

120,128

115,908

 

      OPERATING PROFIT

17,763

15,947

 

  Non-Operating P/L

-151

-3,075

 

      RECURRING PROFIT

17,612

12,872

　

      NET PROFIT

3,576

-11,123

BALANCE SHEET

 

 

 

 

  Cash

　

31,293

33,246

 

  Receivables

 

222,430

221,998

 

  Inventory

 

104,247

94,887

 

  Securities, Marketable

17

113

 

  Other Current Assets

34,657

39,852

 

      TOTAL CURRENT ASSETS

392,644

390,096

 

  Property & Equipment

261,521

252,843

 

  Intangibles

 

12,614

13,975

 

  Investments, Other Fixed Assets

152,923

133,200

 

      TOTAL ASSETS

819,702

790,114

 

  Payables

 

133,125

122,000

 

  Short-Term Bank Loans

125,049

141,857

 

　

 

　

　

 

  Other Current Liabs

69,694

81,848

 

      TOTAL CURRENT LIABS

327,868

345,705

 

  Debentures

 

30,284

22,547

 

  Long-Term Bank Loans

162,830

144,253

 

  Reserve for Retirement Allw

52,294

57,566

 

  Other Debts

　

23,582

22,474

 

      TOTAL LIABILITIES

596,858

592,545

 

      MINORITY INTERESTS

 

 

 

Common stock

69,395

69,395

 

Additional paid-in capital

21,467

21,467

 

Retained earnings

76,125

72,481

 

Evaluation p/l on investments/securities

18,160

11,548

 

Others

 

37,970

22,952

 

Treasury stock, at cost

(274)

(274)

 

      TOTAL S/HOLDERS` EQUITY

222,843

197,569

　

      TOTAL EQUITIES

819,702

790,114

CONSOLIDATED CASH FLOWS

 

 

 

 

Terms ending:

31/03/2013

31/03/2012

 

Cash Flows from Operating Activities

　

54,947

30,774

 

Cash Flows from Investment Activities

-44,939

-20,252

 

Cash Flows from Financing Activities

-11,402

-22,845

　

Cash, Bank Deposits at the Term End

　

30,476

30,084

ANALYTICAL RATIOS            Terms ending:

31/03/2013

31/03/2012

 

 

Net Worth (S/Holders' Equity)

222,843

197,569

 

 

Current Ratio (%)

119.76

112.84

 

 

Net Worth Ratio (%)

27.19

25.01

 

 

Recurring Profit Ratio (%)

1.90

1.40

 

 

Net Profit Ratio (%)

0.39

-1.21

 

 

Return On Equity (%)

1.60

-5.63

 

           

           


 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.61.93

UK Pound

1

Rs.100.44

Euro

1

Rs.84.24

 

 

INFORMATION DETAILS

 

Report Prepared by :

NIS

 

 

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.