Topy Industries, Ltd. Business Report FY ended Mar. 2014

Business Highlights

Financial Overview

(in million JPY)
  FY ended Mar. 31, 2014 FY ended Mar. 31, 2013 Rate of
change (%)
Sales 234,682 226,912 3.4 -
Operating income 5,308 6,990 (24.1) -
Ordinary income 4,485 6,234 (28.1) -
Net income 1,914 3,409 (43.9) -
Automotive/Industrial Component Business
Sales 147,423 145,398 1.4 -Sales of wheels for trucks and passenger cars increased.
Operating income 7,360 9,966 (26.1) -

Recent Development outside Japan

Expanding production volume of steel wheels for passenger vehicles
-The Company announced that it will form Topy MW Manufacturing Mexico S.A. de C.V., a joint-venture company to manufacture and sell steel wheels for passenger vehicles and light trucks in Mexico. With this establishment scheduled in September 2013, the Company will respond to the steady growth in vehicle production in the country, from which exports to other countries in North and South America are anticipated to increase. The new company will cater to the needs of Japanese and American OEMs, its major customers, which are accelerating production expansion and local procurement in the market. The Mexican facility will be invested jointly by Topy and MW Italia S.p.A., Topy's comprehensive business partner in Italy. It will be located at the Santa Fe Industrial Park, Silao, Guanajuato. The plant is scheduled to begin operating in April 2015, when it will start manufacturing and selling steel-wheels for passenger cars and light-weight commercial vehicles. The annual production volume of passenger-car steel-wheels will be increased to 1.75 million units in 2016. After the plant launches operations, it expects to produce 750,000 units during the first nine months, between April and December, and foresees doubling that by 2016. The Company has positioned this plant to respond to Nissan's expanding production volumes in Mexico, planning for it to supply about half of its products to Nissan. By producing products locally, the Company can reduce logistics costs and shorten delivery times.

Commenced production of light weight steel wheels for passenger cars
-The Company will begin producing new lightweight steel wheels for passenger cars at Topy America Inc. in Kentucky, the U.S. in the second half of 2014. Weight of the steel wheels has been reduced by 7 to 10 percent from conventional steel wheels, by partially changing the rim thickness. The steel wheels will be supplied to Japanese automakers' plants in the U.S. This will be the first time for Japanese carmakers to select rims with uneven thickness for passenger cars. The Company will start supplying the wheels in the first half of 2015, and plans to produce 70,000 units monthly for one vehicle model in the first year. From 2016 and onward, the Company hopes to expand production of the steel wheels and supply them for more vehicle models. (From an article in the Nikkan Jidosha Shimbun on March 6, 2014)


-The Company said that its large window wheels with ultra-large perforations started to be installed on Toyota's RAV4 for the first time as original equipment. The 17-inch steel wheels are supplied with dedicated wheel caps. Generally, rigidity of a wheel with large perforations is reduced due to a smaller cross section of the disc. However, Topy Industries has developed its original design which maintains the rigidity of the wheels with large perforations equivalent to existing wheels with smaller perforations. (From an article in the Nikkan Jidosha Shimbun on November 16, 2013)

Outlook for FY ending Mar. 31, 2015

(in million JPY)
  FY ending Mar. 31, 2015
FY ended Mar. 31, 2014
(Actual Results)
Rate of Change
Sales 244,000 234,682 4.0
Operating income 6,600 5,308 24.3
Ordinary income 5,700 4,485 27.1
Net income 3,600 1,914 88.1

>>>Financial Forecast for the Next Fiscal Year (Sales, Operating Income etc.)

Mid-term Management Plan

-The Company announced its mid-term management plan "Growth & Change 2015" that will cover the fiscal years between 2012 and 2015. The Plan calls for achieving an operating revenue of JPY 281.5 billion, an operating profit of JPY 18.0 billion, and a profit margin of 6.4% by the end of the 2015 fiscal year (March 2016). In line with this Plan, the Company will invest JPY 67.3 billion, which is an 80% increase over the amount invested in during its previous mid-term plan. The Company aims to expand its operations outside Japan and fortify its fundamental structure in Japan driving product creation. Out of the total, the Automotive/Industrial Machinery Component Business producing automotive wheels and other products will invest 62% outside Japan.
  • Automotive/industrial machinery Components: Forecast for operating revenue by the end of the 2015 fiscal year (March 2016) is JPY 176.7 billion (a 14.7% increase over fiscal year 2011 figures), with more than 40% generated outside Japan
  • Steel wheels for passenger-cars: Forecast for operating revenue by the end of the 2015 fiscal year (March 2016) is 20% more than it was at the end of the 2011 fiscal year.
  • Steel wheels for mining equipment: Plans are to increase the production capacity of steel wheels for mining equipment by 30%.


R&D Expenditure

(in million JPY)
  FY ended Mar. 31, 2014 FY ended Mar. 31, 2013 FY ended Mar. 31, 2012
Overall 1,519 1,212 1,271
-Automotive & Industrial Machinery Component Business 665 528 541

R&D Facility

-The Company conducts its R&D activities at Research and Development center in the premise of the Toyohashi Factory in Aichi Pref., Japan.

R&D Activities

Automotive & Industrial Machinery Component Business
-The Company conducted research on solutions that reduce weight, improve quality, cut costs, and reduce development lead time. It also did research and development on new products.

-The Company achieved favorable results for its mainstay products, namely automotive steel and aluminum wheels, in terms of improving the accuracy of technology to conduct analysis and evaluations, developing and mass-producing new products, cutting costs, and improving the quality of existing products.

Investment Activities

Capital Expenditure

(in million JPY)
  FY ended Mar. 31, 2014 FY ended Mar. 31, 2013 FY ended Mar. 31, 2012
Overall 25,458 20,477 8,982
-Automotive & Industrial Machinery Component Business 8,554 10,951 5,893

Planned Capital Investment

(As of Mar. 31, 2014)
Activities/Products Planned investment amount (in million JPY) Starting date Planned completion Capacity increase after completion
Topy MW Manufacturing Mexico S.A. de C.V.
(Guanajuato, Mexico)
Manufacturing facility to produce steel wheels for passenger cars and light trucks 2,928 Nov. 2013 Mar. 2015 20% increase in steel-wheel production for passenger cars and light pickup trucks