MIRA INFORM REPORT

 

 

Report Date :

22.11.2014

 

IDENTIFICATION DETAILS

 

Name :

FURUNO ELECTRIC CO LTD

 

 

Registered Office :

9-52 Ashiharacho Nishinomiya City Hyogo-Pref 662-8580

 

 

Country :

Japan

 

 

Financials (as on) :

28.02.2014

 

 

Date of Incorporation :

May 1951

 

 

Legal Form :

Limited Company

 

 

Line of Business :

Manufacturing of fish finders, navigational instruments, radars, industrial electronics

 

 

No. of Employees

2,830

 

 

RATING & COMMENTS

 

MIRA’s Rating :

B

 

RATING

STATUS

PROPOSED CREDIT LINE

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

Small

 

Maximum Credit Limit :

Yen 1,955.6 million

Status :

Moderate

Payment Behaviour :

Slow but correct

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 1, 2014

 

Country Name

Previous Rating

(31.03.2014)

Current Rating

(01.06.2014)

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 and address

 

FURUNO ELECTRIC CO LTD

 

REGD NAME:   Furuno Denki KK

MAIN OFFICE:  9-52 Ashiharacho Nishinomiya City Hyogo-Pref 662-8580 JAPAN

                                    Tel: 0798-65-2111     Fax: -798-63-1020

 

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

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

 

 

ACTIVITIES

 

Mfg of fish finders, navigational instruments, radars, industrial electronics

 

 

BRANCHES   

 

Tokyo, Hokkaido (4), Chiba, Shizuoka, Hiroshima, other (Tot 22)

 

 

OVERSEAS

 

USA (3), Europe (15), Russia, China (3), Hong Kong, Korea, Singapore  (--subsidiaries)

 

 

FACTORY

 

At the caption address, Miki

 

 

CHIEF EXEC 

 

YUKIO FURUNO, PRES & CEO

 

Yen Amount:     In million Yen, unless otherwise stated

 

SUMMARY

 

FINANCES        FAIR                             　         A/SALES          Yen 75,666 M

PAYMENTSSLOW BUT CORRECT         　         CAPITAL           Yen 7,534 M

TREND UP                                　         WORTH            Yen 38,011 M

STARTED         1951                 　                     EMPLOYES      2,830

 

 

COMMENT    

 

MFR OF FISH FINDERS, NAVIGATIONAL AIDS, RADARS, OTHER. 

FINANCIAL SITUATION COSIDERED FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.

                       

 

Business

Terms Ending

Annual Sales*

R.Profit*

N.Profit*

S.Growth

Net Worth*

   Results:

28/02/2011

73,724

1,354

343

(%)

33,504

(Consolidated)

29/02/2012

77,300

2,100

-802

4.85

31,127

 

28/02/2013

71,605

2,142

1,564

-7.37

34,697

 

28/02/2014

75,666

2,396

-660

5.67

38,011

 

28/02/2015

80,000

2,500

1,300

5.73

..

Unit: In Million Yen                    

Forecast (or estimated) figures for 28/02/2015 fiscal term

 

 

HIGHLIGHTS

 

The subject company is pioneer in fish finders, and general mfr of ship electronic equipment, such as navigational instruments including radars (See OPERATION).  Operates a total 25 local subsidiaries in UK, Norway, USA, China, etc.  Focusing on land-based equipment such as car navigation systems, handheld terminals and other electronic equipment.  The company plans to establish a sales subsidiary in Italy in Jan 2016, to strengthen sales in Europe, an important market.  The global commercial ship market will show a sign of recovery.

 

 

FINANCIAL INFORMATION

 

The sales volume for Feb/2014 fiscal term amounted to Yen 75,666 million, a 5.7% up from Yen 71,605 million in the previous term.  Sales of ship-use electronic equipment recovered, aided by price hike on Sept 2013.  Orders for high-profitable fish detectors and other fishing products held firm, and covered drop in demand for commercial ship-use products.  The recurring profit was posted at Yen 2,396 million and the net losses Yen 660 million, respectively, compared with Yen 2,142 million recurring profit and Yen 1,564 million net profit, respectively, a year ago. 

           

For the current term ending Feb 2015 the recurring profit is projected at Yen 2,500 million and the net profit at Yen 1,300 million, on a 5.7% rise in turnover, to Yen 80,000 million.  Sales of fishing products will slow down in Japan, but orders for products for commercial ships and pleasure boats will rally.  Operating profits will rise.  

 

The financial situation is considered FAIR and good for ORDINARY business engagements.  Max credit limit is estimated at Yen 1,955.6 million, on 30 days normal terms.

 

 

REGISTRATION

           

Date Registered:　                   May 1951

Legal Status:                            Limited Company (Kabushiki Kaisha)

Authorized:                              120 million shares

Issued:                                     31,894,554 shares

Sum:                                        Yen 7,534 million

 

Major shareholders (%):           Furuno Kosan (13.7), Customers’ S/Holding Assn (3.3), Dai-ichi Life Ins (3.1), MUFG (3.1), TCSB (Mizuho Bank) (2.9), Japan Trustee Services T4 (2.3), Echo Kosan (1.7), Credit Suisse (Lux.) Behalf (1.6), Kiyokata Furuno (1.5), Employees’ S/Holding Assn (1.3); foreign owners (10.6)

 

No. of shareholders:                 5,437

 

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

 

Managements:                          Yukio Furuno, pres; Hiroyuki Mori, s/mgn dir; Muneyuki Koike, mgn dir; Ryozo Izawa, mgn dir; Yutaka Wada, dir; Shinji Ishihara, dir; Kazuma Waimatsu, dir; Tatsuyuki Okamoto, dir; Yasushi Nishimori, dir; Satoshi Ooya, dir

 

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

 

Related companies:                  Furuno Kyushu Hambai, Furuno Kansai Hambai, Furuno Systems, other

 

 

OPERATION

           

Activities: Manufactures ship-use navigation instruments, fish finders, wireless & communication units (--80%), industrial electronics (15%), others (5%).

 

Overseas Sales Ratio (59%)

 

Clients: [Mfrs, wholesalers] Nippon Suisan, Mitsubishi Heavy Ind, Mitsui Shipbuilding & Engineering, Maruha Nichiro Holdings, Mitsui & Co, VIA Marine, NEC Active, Furuno USA, Furuno Systems Inc, Furuno Kansai Hambai, Furuno Kyushu Hambai, Adachi Co, other

No. of accounts: 800

Domestic areas of activities: Nationwide

 

Suppliers: [mfrs, wholesalers] Toshiba Corp, Panasonic Industry Sales, Alps Electric, Ryoyo Electro, Yamagata Casio, Toyo Electro Corp, other

 

Payment record: Slow but correct

 

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

 

Bank References:

Mizuho Bank (Umeda)

MUFG (Nakanoshima)

Relations: Satisfactory

 

 

FINANCES

 

(In Million Yen)

FINANCES: (Consolidated in million yen)

 

　

　

Terms Ending:

28/02/2014

28/02/2013

INCOME STATEMENT

 

 

 

  Annual Sales

　

75,666

71,605

 

  Cost of Sales

49,436

48,694

 

      GROSS PROFIT

26,230

22,910

 

  Selling & Adm Costs

24,737

21,692

 

      OPERATING PROFIT

1,492

1,218

 

  Non-Operating P/L

904

924

 

      RECURRING PROFIT

2,396

2,142

　

      NET PROFIT

-660

1,564

BALANCE SHEET

 

 

 

 

  Cash

　

13,087

9,752

 

  Receivables

 

19,248

18,805

 

  Inventory

 

28,006

23,874

 

  Securities, Marketable

　

　

 

  Other Current Assets

1,536

2,425

 

      TOTAL CURRENT ASSETS

61,877

54,856

 

  Property & Equipment

9,767

9,065

 

  Intangibles

 

3,851

3,093

 

  Investments, Other Fixed Assets

4,579

5,658

 

      TOTAL ASSETS

80,074

72,672

 

  Payables

 

8,606

12,247

 

  Short-Term Bank Loans

6,953

4,131

 

　

 

　

　

 

  Other Current Liabs

15,330

9,496

 

      TOTAL CURRENT LIABS

30,889

25,874

 

  Debentures

 

　

　

 

  Long-Term Bank Loans

6,461

6,723

 

  Reserve for Retirement Allw

2,580

3,352

 

  Other Debts

　

2,133

2,025

 

      TOTAL LIABILITIES

42,063

37,974

 

      MINORITY INTERESTS

 

 

 

Common stock

7,534

7,534

 

Additional paid-in capital

10,074

10,074

 

Retained earnings

19,024

19,952

 

Evaluation p/l on investments/securities

685

406

 

Others

 

873

(3,090)

 

Treasury stock, at cost

(179)

(179)

 

      TOTAL S/HOLDERS` EQUITY

38,011

34,697

　

      TOTAL EQUITIES

80,074

72,672

CONSOLIDATED CASH FLOWS

 

 

 

 

Terms ending:

28/02/2014

28/02/2013

 

Cash Flows from Operating Activities

　

1,209

770

 

Cash Flows from Investment Activities

-2,793

-2,384

 

Cash Flows from Financing Activities

3,229

-1,802

　

Cash, Bank Deposits at the Term End

　

12,707

9,425

ANALYTICAL RATIOS            Terms ending:

28/02/2014

28/02/2013

 

 

Net Worth (S/Holders' Equity)

38,011

34,697

 

 

Current Ratio (%)

200.32

212.01

 

 

Net Worth Ratio (%)

47.47

47.74

 

 

Recurring Profit Ratio (%)

3.17

2.99

 

 

Net Profit Ratio (%)

-0.87

2.18

 

 

Return On Equity (%)

-1.74

4.51

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.61.85

UK Pound

1

Rs.97.01

Euro

1

Rs.77.62                         

 

INFORMATION DETAILS

 

Report Prepared by :

SMN

 

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.