Asahi Tec Corporation Business Report FY2007
Business Highlights
| Financial overview | (in millions of JPY) |
| FY2007 | FY2006 | Rate of change(%) | Factors | |
| Overall | ||||
| Sales | 315,885 | 145,702 | 116.8 | -Sales increased year-on-year, as a result of the following: increased demand for the Company's products in line with increased exports of trucks to emerging countries from Japan; strong initial sales of new aluminum wheels; and the addition of Metaldyne Holdings LLC (and its subsidiaries also referred collectively as Metaldyne), which was acquired and made into a consolidated subsidiary in 2007 and added to the Company's consolidated financial statements. |
| Operating income | 3,340 | 3,276 | 1.9 | -While performance in Japan and Europe remained fairly strong, losses at Metaldyne worsened due to the sluggish North American market. |
| Ordinary income | (8,602) | (162) | - | |
| Net income | (34,818) | (665) | - | - |
| Parts Business Segment | ||||
| Sales | 306,362 | 136,941 | 123.8 | -Sales increased year-on-year as a result of the addition of the sales of Metaldyne; as well as to the continued strong demand for automotive parts in emerging countries. |
| Operating income | 3,643 | 3,651 | (0.9) | -Losses at Metaldyne worsened due to the sluggish North American market. |
New subsidiaries
-The Company, which had previously acquired a 66% stake in Techno-Metal Co., LTD (TMK) or 128,000 shares of TMK, from Mitsubishi Fuso Truck and Bus Corporation (MFTBC) in February 2006, announced that it has additionally acquired the remaining 34% stake in TMK or 66,000 shares, as of August 29, 2007, consequently making TMK its wholly owned subsidiary. The total production volume, its own and that of TMK being combined, makes the No. 2 position in ductile iron casting industry and their operations have sustained a healthy growth supported by robust demand in truck and construction machinery sectors. (From a press release on Aug. 30, 2007)
New company established
-The Company established its second aluminum wheel manufacturing company in China jointly with Wheelhorse Aluminum Casting Co., Ltd. in March 2007.
R&D
| R&D Expenditure | (in millions of JPY) |
| FY2007 | FY2006 | FY2005 | |
| Group | 3,390 | 998 | 537 |
| Parts Business | 3,217 | 876 | 400 |
R&D Structure
-The Company has 191 R&D engineers as of March 2008.
Recent developments (Parts business)
| Product | Details |
| Magnesium die casting | The Company, which already launched mass-production of large magnesium die cast products mainly for passenger vehicles, is engaged in expanding the development, design and application of magnesium die cast products. The Company also is developing technology that enables materials to be recycled very cost effectively. |
| Internal smoothing technology | The Company already commercially produced products such as intake manifolds for passenger vehicles by using internal smoothing technology. The Company has had a clear idea that the right combination of alloy constituents and an appropriate level of heat treatment would significantly improve the anti-fatigue properties of products. As a result, it is developing specific applications of this technology based on its findings. |
| New Aluminum casting and forging | In preparing for greater demand for lighter weight vehicles , the Company is developing a new casting method to produce cast products that use high-strength aluminum alloy; and working to develop a method that controls solidification based on precise temperature control. |
| Iron casting | In the area of iron casting, the Company launched mass-production of high-strength, hyper-ductile components for trucks. It is working on expanding the application of iron casting, improving the resulting product properties and improving alloy constituents to reduce costs. |
| Powertrain chassis | The Company's consolidated subsidiary, Metaldyne Corporation, is engaged in establishing casting technology that can be used to design frames and make light-weight powertrain chassis. |
Investment Activities
| Capital investment | (in millions of JPY) |
| FY2007 | FY2006 | FY2005 | |
| Group | 13,500 | 184,174 | 4,555 |
| Parts Business | 13,388 | 184,099 | 3,547 |
-The focus of the Company's investments in its parts business was on renewing and maintaining equipment to enhance its production efficiency when it comes to manufacturing general auto parts.
Overseas investment (FY2007)
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-In March 2007, the Company established its second aluminum wheel manufacturing company in China, jointly with Wheelhorse Aluminum Casting Co., Ltd. The new company, Wheelhorse Asahi Aluminum Casting Co., Ltd., was capitalized at 775 million yen, 30% of which was invested by the Company and 70% by Wheelhorse Aluminum Casting Co., Ltd. As the annual production capacity by the end of 2007 of the new subsidiary was expected to reach 100 million units, the Company's total production capacity in China is estimated at 200 million units per year. When this is combined with the production capacity of its subsidiary in Thailand producing wheels, the Company will have the capacity to produce 360 million units per year, which would ensure a steady supply of wheels to its customers in Japan, Thailand, and China. (From a press release on April 13, 2007)
New facilities
| Name (location) |
Type of facility | Planned total investment (million JPY) |
Start | End |
| Kikugawa Minami Plant (Japan) |
Facilities to manufacture engine components | 94 | Apr. 2008 |
Jan. 2009 |
| Techno-Metal Co., Ltd. (Japan) |
Facilities to manufacture ductile cast iron | 1,100 | May 2007 |
Mar. 2014 |
| Asahi Tec Metals (Thailand) Co., Ltd. (Thailand) |
Facilities to manufacture ductile cast iron | 3,192 | Apr. 2008 |
Mar. 2012 |
| Asahi Tec Aluminum (Thailand) Co., Ltd. (Thailand) |
Facilities to manufacture ductile cast iron | 143 | Apr. 2008 |
Jan. 2009 |
| Metaldyne Chassis Manufacturing (Hangzhou) Co., Ltd. (China) |
Facilities to manufacture powertrain products | 887 | Apr. 2008 |
Mar. 2009 |
| Metaldyne Korea Limited (Korea) |
Facilities to manufacture powertrain products | 777 | Apr. 2008 |
Mar. 2009 |
| Metaldyne Sintered Components Mexico, S. de R.L.de C.V. (Mexico) |
Facilities to manufacture powertrain products | 461 | Apr. 2008 |
Dec. 2008 |
| Metaldyne Engine Holdings, S.L. (Spain) |
Facilities to manufacture chassis components and powertrain products | 300 | Apr. 2008 |
Mar. 2009 |
| Metaldyne International France SAS (France) |
Facilities to manufacture powertrain products | 220 | Apr. 2008 |
Mar. 2009 |
| Metaldyne Zell GmbH & Co. KG (Germany) |
Facilities to manufacture chassis components | 149 | Apr. 2008 |
Mar. 2009 |