Kokusan Denki Co., Ltd. Business report FY2007

Business Highlights

Financial overview (in millions of JPY)
  FY2007 FY2006 Rate of Change (%) Factors
Sales 23,516 23,245 1.2 -Sales increased due to an increase in sales of onboard motors.
Operating income 576 394 46.2 -
Ordinary income 676 473 42.9 -Ordinary income increased due to the company's reducing cost such as initial costs ad restructuring. 
Net income 359 321 12.0 -
Electric Products Division
Sales 13,570 13,868 (2.1) -While sales of products for outboard boat-motors increased, thanks to strong sales in the European market, total sales and operating income decreased due to slumping sales of products for snow mobiles in the North American market because of lighter snowfall. The decline is also the result of slumping sales of products for ATVs due to the rise in the price of oil; and the slowdown in business in general. 
Operating income 659 701 (6.0)
Generator Division
Sales 1,484 2,568 (42.2) -Sales in this sector significantly dropped because of sluggish demand for engine-power generators, the company's main stay products, in the North American market.
Operating income 56 (39) -
Motor Division
Sales 8,461 6,809 24.3 -Revenue grew due to an increase in the sales of power steering motors for 4WD vehicles.
Operating income 289 144 100.7


R&D Expenditure (in millions of JPY)
  FY2007 FY2006 FY2005
Electrical Products Division 213 195 179
Generator Division 14 10 6
Motor Division 67 67 26
Others 25 34 31
Total 319 306 242

Major R&D Activities
Electrical Products Division
-The Company worked in the area of, namely highly efficient, high-output AC generators and regulators. The Company improved its ignition and fuel injection systems by getting them to fit as optimally as possible in engines. 

-The Company worked on developing and commercializing charging systems and engine control systems used in motorcycles, ATVs, snowmobiles, outboard boat motors, and utility engines.

Generator Division
-Under the aim of achieving energy savings, size reductions, improved efficiency, and noise reductions, the Company is working not only on developing new sales wins but also on increasing current volumes of high quality inverter generators based on one of its areas of core competencies, permanent-magnetic generators.

Motor Division
-Working under the objective of saving energy, the Company is currently developing small sized, highly efficient, low cogging motors for automobiles. It is also developing small-sized ABS motors that are being made more convenient to install. 

-The Company is currently developing and expanding sales of various actuator motors for motorcycles, ATVs, and snowmobiles that demonstrate excellent properties in terms of vibration, pressure, and dust resistance.

Investment Activities

-The Company spent 737 million yen on capital investments in FY2007, focusing on constructing a new motor production line, rationalizing investments to achieve energy savings, introducing IT, investing in molds in response to orders for new products, and investing to replace aging facilities.

The major investments on mechanical equipment in FY 2007
Segment in million yen Main facilities
Electrical Products Division 340 Electric components rationalization facilities, etc.
Motor Division 61 Construction of new motor production line

Capital investment plans
Site name Location Type of facility and activities Planned investment amount (million yen) Commencement and completion Month/Year
Commencement Completion
Headquarters factory Numazu city, Shizuoka prefecture Electric components production; and rationalizing facilities 145 May. 2008 Mar. 2009
Gotemba factory Gotemba city, Shizuoka prefecture Electric component production; and rationalizing facilities 184 May. 2008 Mar. 2009