Ahresty corporation Business report FY2006
Business Highlights
Financial overview
Factors
1) Overall
Factors for the increased income and sales include aggressive sales growth, the establishment of additional domestic and overseas production divisions, and the enhancement of production facilities.
2) Die Casting Division
Total sales of the division amounted to 109 billion, 686 million yen (an 18.8% year-on-year increase) , which was the result of the performance of the new consolidated subsidiaries such as Tokai Seiko Co., Ltd. being included this year (increase of 5,133 million yen), the change in the fiscal-year reporting period at subsidiaries (previously they were accounted for under the consolidated fiscal-year reporting) (increase of 669 million yen), and a sharp rise in materials prices of bare metal (increase of about 8,000 million yen), etc. The business operating profit amounted to 7,183 million yen (a 30.4 year-on-year increase) due to production-cost reduction activities, cuts in expenses, and streamlining and improving the efficiency of operations.
3) Aluminum Division
Total sales of the division amounted to 9,289 million yen (a 51.5% year-on-year increase). This was due to a 12.0% increase in the percentage that aluminum accounted for of total sales compared to the previous reporting period, which was a result of increased demand from the automobile industry. It is also due to increased selling prices as a result of a sharp rise in bare metal prices and increased sales of high-end products. The operating income amounted to 436 million yen (an 86.5 % year-on-year increase) due to increases in crude oil prices and a sharp rise in materials prices , which were offset by initiatives to improve productivity, etc.
<Sales by region>
<Japan>
In contrast to decreasing domestic auto sales in Japan, export volumes in the die casting business, which is the Company's core business segment, increased due to the Japanese auto makers increasing their production volume overseas. Japanese automakers are the company's main customers. In addition, sales of mainstay automotive parts increased. As a result, total sales amounted to 104 billion, 136 million yen (a 20.1% year-on-year increase), and the operating income amounted to 6,622 million yen (a 62.6% year-on-year increase).
<North America>
Total sales amounted to 15 billion, 913 million yen (a 16.1% year-on-year increase), supported by Japanese automakers which are going strong in the US market. On the other hand, business operating profit was 1,448 million yen (a 8.1% year-on-year decrease), the result of greater demands for cost reductions due to changes in the competitive environment.
<Others>
Sales amounted to 2,711 million yen (a 128.2% year-on-year increase) due to the favorable performance of the new consolidated subsidiaries in China, and strong sales in Thailand and Taiwan. On the other hand, business operating profit was 131 million yen (a 14.0% year-on-year decrease) due to prior investments made for expanding production capacity.
Overseas deployment
<Mexico>
- The company announced in June 2006 that it had established a sales and production subsidiary to produce die cast products in Mexico. Start of production is planned in Autumn 2007.
<India>
-The company announced in January 2007 that it would start sales and production of automobile die cast parts in India. It established a local subsidiary in India in January2007, planning to start production there in Autumn 2008. The planned total investment by the end of 2010 is 2.3 billion yen.
>>>see "Investments"
| - | Mar. 2007 | Mar. 2006 | R.C. | Factors |
| Overall | ||||
| Sales | 122,761 | 101,609 | 7.0% | See note 1) below |
| Operating income | 7,944 | 5,916 | 5.7% | - |
| Ordinary income | 7,934 | 5,594 | 16.5% | - |
| Net income | 7,528 | 3,734 | 64.9% | - |
| Die Casting Division | ||||
| Sales | 109,686 | 92,306 | 9.1% | See note 2) below |
| Operating income | 7,183 | 5,420 | 7.5% | |
| Aluminum Division | ||||
| Sales | 9,289 | 6,131 | 15.1% | See note 3) below |
| Operating income | 436 | 234 | 9.9% | |
| ( R.C. : Rate of Change ) |
1) Overall
Factors for the increased income and sales include aggressive sales growth, the establishment of additional domestic and overseas production divisions, and the enhancement of production facilities.
2) Die Casting Division
Total sales of the division amounted to 109 billion, 686 million yen (an 18.8% year-on-year increase) , which was the result of the performance of the new consolidated subsidiaries such as Tokai Seiko Co., Ltd. being included this year (increase of 5,133 million yen), the change in the fiscal-year reporting period at subsidiaries (previously they were accounted for under the consolidated fiscal-year reporting) (increase of 669 million yen), and a sharp rise in materials prices of bare metal (increase of about 8,000 million yen), etc. The business operating profit amounted to 7,183 million yen (a 30.4 year-on-year increase) due to production-cost reduction activities, cuts in expenses, and streamlining and improving the efficiency of operations.
3) Aluminum Division
Total sales of the division amounted to 9,289 million yen (a 51.5% year-on-year increase). This was due to a 12.0% increase in the percentage that aluminum accounted for of total sales compared to the previous reporting period, which was a result of increased demand from the automobile industry. It is also due to increased selling prices as a result of a sharp rise in bare metal prices and increased sales of high-end products. The operating income amounted to 436 million yen (an 86.5 % year-on-year increase) due to increases in crude oil prices and a sharp rise in materials prices , which were offset by initiatives to improve productivity, etc.
<Sales by region>
<Japan>
In contrast to decreasing domestic auto sales in Japan, export volumes in the die casting business, which is the Company's core business segment, increased due to the Japanese auto makers increasing their production volume overseas. Japanese automakers are the company's main customers. In addition, sales of mainstay automotive parts increased. As a result, total sales amounted to 104 billion, 136 million yen (a 20.1% year-on-year increase), and the operating income amounted to 6,622 million yen (a 62.6% year-on-year increase).
<North America>
Total sales amounted to 15 billion, 913 million yen (a 16.1% year-on-year increase), supported by Japanese automakers which are going strong in the US market. On the other hand, business operating profit was 1,448 million yen (a 8.1% year-on-year decrease), the result of greater demands for cost reductions due to changes in the competitive environment.
<Others>
Sales amounted to 2,711 million yen (a 128.2% year-on-year increase) due to the favorable performance of the new consolidated subsidiaries in China, and strong sales in Thailand and Taiwan. On the other hand, business operating profit was 131 million yen (a 14.0% year-on-year decrease) due to prior investments made for expanding production capacity.
Overseas deployment
<Mexico>
- The company announced in June 2006 that it had established a sales and production subsidiary to produce die cast products in Mexico. Start of production is planned in Autumn 2007.
<India>
-The company announced in January 2007 that it would start sales and production of automobile die cast parts in India. It established a local subsidiary in India in January2007, planning to start production there in Autumn 2008. The planned total investment by the end of 2010 is 2.3 billion yen.
>>>see "Investments"
R&D
| R&D Expenditure | ( in millions of JPY ) |
| - | Mar. 2007 | Mar. 2006 | Mar. 2005 |
| Group | 1,154 | 663 | 705 |
| Die Casting Division | N.A. | N.A. | 674 |
Research and development system
- The Company held a ceremony on November 21, 2006 to celebrate the completion of a Technical Center in Toyohashi City, Aichi Prefecture, inviting local government officials and other concerned persons. By integrating, the company's research and development functions for aluminum die-cast products and other products used in automobiles and motorcycles to the new facility, the company aims to improve business efficiencies and product quality in the sector. The Company has been working on increasing its production capacity and reinforcing its R&D structure at the Toyohashi plant in order to provide better support to vehicle, motorcycle, and auto component manufacturers located to the west of Toyohashi City. Manufacturers include Honda Motor Co., Ltd.; Yamaha Motor Co., Ltd.; and Suzuki Motor Corporation, to name a few. (From an article in the Nikkan Jidosha Shimbun on Nov.22, 2006)
- The Company plans to focus on technology and product development of large-item products used in automobile engine and body parts. The company opened a new R&D center and has consolidated functions involved with this area of business. Taking this opportunity, it will improve efficiency in developing large-item products, which have required comparatively long lead times. For the time being, the Company will focus on developing door frame parts, cylinders, crankcases and their peripherals to win business as soon as it can. The company aims to reinforce its business base by increasing high value-added products. (From an article in the Nikkan Jidosha Shimbun on Dec.7, 2006)
Investment Activities
R&D