Kyowa Leather Cloth Co., Ltd. Business Report FY ended Mar. 2013

Business Highlights

Financial Overview

(in millions of JPY)
  FY ended Mar. 31, 2013 FY ended Mar. 31, 2012 Rate of Change (%) Factors
Sales 34,289 29,934 14.5 -The volume of orders won from customers increased year-on-year in the first half of the fiscal year because of the eco-car sales incentive programs, greater sales of urethane synthetic leather, and the subsidiary in China being added as a consolidated subsidiary.
Operating income 284 (890) - -
Ordinary income 302 (940) - -
Current net income 216 (958) - -

-Operating revenue from the automotive business increased 24.9% year-on-year, growing to 21,718 million yen, which accounts for 63.3% of all operating revenue of the Company.

Outlook for FY ending Mar. 31, 2014 

(in millions of JPY)
  FY ending Mar. 31, 2014 FY ended Mar. 31, 2013 Rate of change (%)
Sales 36,500 34,289 6.4
Operating income 400 284 40.8
Ordinary income 300 302 (0.7)
Net income 200 216 (7.4)

R&D

R&D Expenditure

(in millions of JPY)
  FY ended Mar. 31, 2013 FY ended Mar. 31, 2012 FY ended Mar. 31, 2011
Overall 565 560 575

R&D Structure

-The Company has a technical center in Hamamatsu City, Shizuoka Prefecture.

R&D Activities

Development agendas of the automotive interior business
-The Company is developing new, synthetic-leather materials that contribute to enhancing the quality of vehicles.
-The Company is working to improve upon and develop product technology that takes into consideration factors such as weight reduction, ease of recycling, lowered costs, environmental protection, and greater comfort for passengers.

Product Development

-The Company's proprietary Aquawish, an environmentally friendly aqueous synthetic leather, was employed as an automotive interior material for the first time.

Investment Activities

Capital Expenditure

(in millions of JPY)
  FY ended Mar. 31, 2013 FY ended Mar. 31, 2012 FY ended Mar. 31, 2011
Overall 1,199 2,790 1,300

-The Company is making capital investments in its facilities and equipment, mainly in the coating machines in Plant No. 2 at the Tenryu Plant, and in its printers. In addition, the Company is spending to develop new products and to improve its operating cost-structure in order to lower costs.

Planned Capital Investment

(As of Mar. 31, 2013)
Name Facility Total Amount Invested
(In millions of JPY)
Started Expected to Complete in Increased Capacity after Completion
1st Tenryu Plant
(Shizuoka Pref., Japan)
Synthetic leather (for vehicles, furniture, shoes and general merchandise) 313 Apr.
2013
Mar.
2014
-
2nd Tenryu Plant
(Shizuoka Pref., Japan)
Composites for molding and making synthetic leather (for vehicles, furniture, shoes and general merchandise) 580 Apr.
2013
Mar.
2014
-
Shinshiro Plant
(Aichi Pref., Japan)
Production facilities to form automotive composite materials 123 Apr.
2013
Mar.
2014
-
Headquarters
(Shizuoka Pref., Japan)
Facilities for conducting R&D 191 Apr.
2013
Mar.
2014
-