MIRA INFORM REPORT

 

 

Report Date :

16.07.2014

 

 

IDENTIFICATION DETAILS

 

Name :

JGC CORPORATION

 

 

Registered Office :

2-1 Otemachi 2-Chome Chiyoda Ku Tokyo

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2014 (Consolidated)

 

 

Date of Incorporation :

October 1928

 

 

Com. Reg. No.:

(Tokyo-Chiyodaku) 008732

 

 

Legal Form :

Limited Company (Kabushiki Kaisha)

 

 

Line of Business :

·         Subject is an Industrial Plant Engineering Company. 

Subject product ranges includes Catalysts-Related (FCC Catalysts, Hydraulic Treatment Catalysts, De-Sulfurization Catalysts, Catalysts for Petrochemicals); New Functional-Related Products (Colloidal Silica, CRT/FPD Surface Treatment Agents, LCD’s Materials, Semiconductor Materials, Batteries, Cosmetics, Optical, Other Materials & Antibacterial Agents)

 

 

No. of Employees

7,005

 

 

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

 

Maximum Credit Limit :

Yen 24,924.7 Million

 

 

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 31, 2014

 

Country Name

Previous Rating

(31.12.2013)

Current Rating

(31.03.2014)

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. Prime Minister Shinzo ABE has declared the economy his government's top priority; he has overturned his predecessor's plan to permanently close nuclear power plants and is pursuing an economic revitalization agenda of fiscal stimulus, monetary easing, and structural reform. Japan joined the Trans Pacific Partnership negotiations in 2013, a pact that would open Japan's economy to increased foreign competition and create new export opportunities for Japanese businesses. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, Japan in 2013 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 is exceeding 230% of GDP. To help raise government revenue and reduce public debt, Japan decided in 2013 to gradually increase the consumption tax to a total of 10% by the year 2015. Japan is making progress on ending deflation due to a weaker yen and higher energy costs, but reliance on exports to drive growth and an aging, shrinking population pose other major long-term challenges for the economy.

 

Source : CIA

 

 

 

Company name

 

JGC CORPORATION

 

 

REGD NAME

 

Nikki KK

 

MAIN OFFICE

 

Queen Tower A, 2-3-1 Minatomirai Nishiku Yokohama 220-6001 JAPAN

Tel: 045-682-1111     Fax: 045-682-1112

 

*.. The is its Registered and Tokyo Headquarters

 

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

E-Mail address:                        webmaster@jgc.co.jp

 

 

ACTIVITIES

           

·         Subject is an Industrial Plant Engineering Company. 

Subject product ranges includes Catalysts-Related (FCC Catalysts, Hydraulic Treatment Catalysts, De-Sulfurization Catalysts, Catalysts for Petrochemicals); New Functional-Related Products (Colloidal Silica, CRT/FPD Surface Treatment Agents, LCD’s Materials, Semiconductor Materials, Batteries, Cosmetics, Optical, Other Materials & Antibacterial Agents)

 

 

BRANCHES

 

Tokyo, Osaka, Yokohama, other (Tot 15)

 

 

OVERSEAs

 

Beijing, Singapore, Paris, London, Jakarta, Bangkok, Abu Dhabi, Algiers, Teheran, Arzew (Algeria) (Affiliated): China, Philippines, Singapore, Korea, Malaysia, Indonesia, Pakistan, Saudi Arabia (2), UAE, Qatar, UK (2), Netherlands, Nigeria, Algeria, USA, Venezuela

 

 

CHIEF EXEC

 

KOICHI KAWANA, PRES & CEO

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY

 

FINANCES        FAIR                 A/SALES          Yen 675,821 M

PAYMENTS      REGULAR         CAPITAL           Yen 23,511 M

TREND             UP                    WORTH            Yen 379,882 M

STARTED         1928                 EMPLOYES      7,005

 

 

COMMENT    

 

INDUSTRIAL PLANT ENGINEERING COMPANY. 

 

FINANCIAL SITUATION CONSIDERED FAIR TO GOOD AND RESPONSIBLE FOR ORDINARY BUSINESS ENGAGEMENTS.

 

MAX CREDIT LIMIT: YEN 24,924.7 MILLION, 30 DAYS NORMAL TERMS

 

 

Business

Terms Ending

Annual Sales*

R.Profit*

N.Profit*

S.Growth

Net Worth*

   Results:

31/03/2011

447,222

63,395

25,477

(%)

264,483

(Consolidated)

31/03/2012

556,966

72,550

39,111

24.54

291,042

 

31/03/2013

624,637

72,489

46,179

12.15

336,083

 

31/03/2014

675,821

83,675

47,178

8.19

379,882

 

31/03/2015

780,000

59,000

42,000

15.42

..

                        Unit: In Million Yen

                        Forecast (or estimated) figures for 31/03/2015 fiscal term

 

 

HIGHLIGHTS

 

This is an independent general engineering company, founded originally in 1928 as producer of oil products, on acquisition of license of Dubbs’ thermal cracking process from old Universal Oil Products, USA.  Strong in oil refining, petrochemicals, LNG & nuclear fuel processing lines.  Overseas sales ratio about 60%.  With no production division, all materials, machinery & plants are outsourced including subsidiaries.  Works cover industrial plants, such as crude oil, lube oil, LNG, LPG, ethylene, power generation, nuclear power facilities, food processing, hospitals, shopping centers, airports, non-ferrous metal smelting, pharmaceuticals & R&D facilities, information & telecommunications facilities, medical & welfare facilities, other.  Has close association with Shell.  The company won orders for ethylene facility projects in the southern US.  It has made a bid for 2 LNG plant construction contracts valued several hundreds of billion Yen in the US and Canada, with bidding results to be informed by the end of the current term.

 

 

FINANCIAL INFORMATION

 

The sales volume for Mar/2014 fiscal term amounted to Yen 675,821 million, an 8.2% up from Yen 624,637 million in the previous term.  Work completions continued growing, led by those for LNG facilities.  Net profits hit a record high consecutively.  Plant construction works increased in North America due to shale gas revolution.  The recurring profit was posted at Yen 83,675 million and the net profit at Yen 47,178 million, respectively, compared with Yen 72,489 million recurring profit and Yen 46,179 million net profit, respectively, a year ago.

 

For the current term ending Mar 2015 the recurring profit is projected at Yen 59,000 million and the net profit at Yen 42,000 million, respectively, on a 15.4% rise in turnover, to Yen 780,000 million.  The term’s order backlog is ample at Yen 1.5 trillion.  Large-scale works for natural gas and petroleum refining plants including ultralarge-scale Ichthy7s LNG project in Australia have been underway. 

 

The financial situation is considered FAIR to GOOD and responsible for ORDINARY business engagements.  Max credit limit is estimated at Yen 24,924.7 million, on 30 days normal terms. 

 

 

REGISTRATION

 

Date Registered: Oct 1928

Regd No.:      (Tokyo-Chiyodaku) 008732

Legal Status:   Limited Company (Kabushiki Kaisha)

Authorized:      600 million shares

Issued:             259,052,929 shares

Sum:                 Yen 23,511 million

 

Major shareholders (%): Master Trust Bank of Japan T (7.2), Japan Trustee Services T (6.5), Nikki Shoji (4.6), SMBC (4.2), JGC Scholarship Foundation (3.2), Company’s Treasury Stock (2.5), Mizuho Corporate Bank (2.2), Chase Manhattan GTS Escrow (1.6), Northern Trust (AVFC) American (1.5), Chase London SL Omnibus Acct (1.4); foreign owners (44.5)

 

No. of shareholders: 5,998

 

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

 

Managements: Keisuke Takeuchi, ch; Koichi Kawana, pres: Tadashi Ishizuka, v pres; Masayuki Sato, v pres; Hiroshi Yamazaki, v pres; Tsutomu Akabane, s/mgn dir; Hideaki Miura, mgn dir; Hiroshi Sato, mgn dir; Yasumasa Isetani, dir; Yasuhiro Fukuyama, dir

 

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

 

Related companies: JGC Catalysts & Chemicals Ind, JGC Information Systems, JGC Projects Services, Japan Fine Ceramics, JGC Plantech, other . .

           

 

 

 

 

OPERATION

 

Activities: General engineering works (sales breakdown by divisions): Comprehensive engineering works* (92%), catalysts & chemicals** (--6%), others (2%).

 

Overseas sales ratio (77%)

 

*.. Detailed breakdown by industrial areas: oil/gas/resources (15%), petroleum refining (17%), LNG (15%), chemicals (34%), power generation (8%), others (11%).  (% are all about).

 

** Products: catalysts-related (FCC catalysts, hydraulic treatment catalysts, de-sulfurization catalysts, catalysts for petrochemicals); new functional-related products (colloidal silica, CRT/FPD surface treatment agents, LCD’s materials, semiconductor materials, batteries, cosmetics, optical, other materials, antibacterial agents, other)

 

Clients: [Oil refineries, chemical mfrs, other mfrs] Cosmo Oil, Nippon Petrochemicals, Nippon Petroleum Refining, Kyushu Oil, Japan Energy, other.

No. of accounts: 1,000

Domestic areas of activities: Nationwide

 

Suppliers: [Mfrs, wholesalers] Mitsui Engineering & Shipbuilding, Mitsubishi Heavy Ind, Hitachi Ltd, Yokogawa Electric, Kobe Steel, Shinko Planning, Sanki Engineering, other.

 

Payment record: Regular

 

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

 

Bank References:

MUFG (H/O)

SMBC (H/O)

Relations: Satisfactory

 

 

 

 

FINANCES

(In Million Yen)

 

FINANCES: (Consolidated in million yen)

 

 

 

Terms Ending:

31/03/2014

31/03/2013

INCOME STATEMENT

 

 

 

Annual Sales

 

675,821

624,637

 

Cost of Sales

587,437

540,164

 

      GROSS PROFIT

88,384

84,473

 

  Selling & Adm Costs

20,130

20,349

 

      OPERATING PROFIT

68,253

64,123

 

  Non-Operating P/L

15,422

8,366

 

      RECURRING PROFIT

83,675

72,489

　

      NET PROFIT

47,178

46,179

BALANCE SHEET

 

 

 

 

  Cash

　

354,199

259,777

 

  Receivables

 

102,170

96,570

 

  Inventory

 

46,885

42,264

 

  Securities, Marketable

31,052

25,000

 

  Other Current Assets

41,580

36,620

 

      TOTAL CURRENT ASSETS

575,886

460,231

 

  Property & Equipment

70,290

71,708

 

  Intangibles

 

16,757

12,780

 

  Investments, Other Fixed Assets

83,169

84,038

 

      TOTAL ASSETS

746,102

628,757

 

  Payables

 

107,450

93,335

 

  Short-Term Bank Loans

　

　

 

　

 

　

　

 

  Other Current Liabs

225,903

169,104

 

      TOTAL CURRENT LIABS

333,353

262,439

 

  Debentures

 

　

　

 

  Long-Term Bank Loans

13,001

9,363

 

  Reserve for Retirement Allw

11,436

12,355

 

  Other Debts

　

8,430

8,517

 

      TOTAL LIABILITIES

366,220

292,674

 

      MINORITY INTERESTS

 

 

 

Common stock

23,511

23,511

 

Additional paid-in capital

25,007

25,603

 

Retained earnings

327,775

291,781

 

Evaluation p/l on investments/securities

6,868

5,417

 

Others

 

3,198

(3,899)

 

Treasury stock, at cost

(6,477)

(6,330)

 

      TOTAL S/HOLDERS` EQUITY

379,882

336,083

　

      TOTAL EQUITIES

746,102

628,757

CONSOLIDATED CASH FLOWS

 

 

 

 

Terms ending:

31/03/2014

31/03/2013

 

Cash Flows from Operating Activities

　

120,576

85,010

 

Cash Flows from Investment Activities

-18,728

-28,370

 

Cash Flows from Financing Activities

-10,687

-2,695

　

Cash, Bank Deposits at the Term End

　

385,252

284,777

ANALYTICAL RATIOS            Terms ending:

31/03/2014

31/03/2013

 

 

Net Worth (S/Holders' Equity)

379,882

336,083

 

 

Current Ratio (%)

172.76

175.37

 

 

Net Worth Ratio (%)

50.92

53.45

 

 

Recurring Profit Ratio (%)

12.38

11.60

 

 

Net Profit Ratio (%)

6.98

7.39

 

 

Return On Equity (%)

12.42

13.74

 

 

           


 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.60.22

UK Pound

1

Rs.102.79

Euro

1

Rs.81.95

                

INFORMATION DETAILS

 

Analysis Done by :

SUM

 

 

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.