SNT CORPORATION Business report FY2006

Business Highlights

Financial overview

(In millions JPY)

FY2006 FY2005 Rate of
Change (%)
Sales 19,208 17,203 11.7% -
Operating income 1,899 1,603 18.5%
Ordinary income 2,647 2,054 28.9%
Net income 1,817 1,242 46.3%
Forged products business
Sales 15,005 13,257 13.2% see note 1) below
Operating income 1,827 1,707 7.0% see note 2) below

1. Sales at the forged products business increased by 13.2%. Siam Metal Technology Co., Ltd. of Thailand recorded a 28.8% sales increase, amounting to 515 million yen. Chubu Tanko Co., Ltd. and the Takahagi forging plant in Japan also recorded increases in both sales and profit.

2. Although revenue increased, the Company was too late in passing price hikes in special steel onto the selling prices of its products. This then significantly impacted the results of its sales operations.

Joint venture in Thailand became a wholly owned subsidiary
The Company made Siam Metal Technology Co., Ltd. its wholly-owned subsidiary, by acquiring the remaining 25% share in the Thai joint venture from Nissan Motor Co., Ltd. Under the umbrella of the Company - an independent supplier of forging products - Siam Metal Technology will expand its supply capacity in order to meet robust demand in Thailand. (From a press release on Nov. 6 2006)

Challenges for the future

Mid to long-term management strategy
1) The Company will work to improve its human resources by hiring qualified individuals and then building their knowledge and skills through training.
2) The Company will work to optimize both its production and sales structures and strive to reinforce its business strategies in and outside Japan
3) The Company will recruit more technical personnel and enhance training.
4) As measures to develop new and differentiated products and further improve productivity, the Company will work on developing new forging methods such as near net shaving and burr-free processing, in addition to using smaller sized facilities.

Investment Activities

Investment Expenditure
(in millions of JPY) FY2006 FY2005 FY2004
Overall 1,157 866 2,877
Forged products business 990 711 355
Forged products business: Major investments include: special high-voltage input and transformer facilities at the Company's subsidiary, Chubu Tanko; forging tools, dies and a 1,250-ton screw press at Siam Metal Technology Co., Ltd.

New Facilities (in millions of JPY)
Company Name Type of facility Planned
Construction start Planned completion Production Capacity after completion
Siam Metal Technology Co., Ltd.
(Rayong, Thailand)
3,000-ton forging press 620 2008.1 2008.6 Max 700T/Monthly
(based on the stamping weight)