Tokai Rubber Industries Business Report FY2008

Business Highlights

Financial Overview (in millions JPY)
  FY2008 FY2007 Rate of Change (%) Factors
Sales 274,392 311,995 (12.1) -
Operating income 6,079 24,704 (75.4)
Ordinary income 5,376 24,171 (77.8)
Current net income 1,141 14,241 (92.0)
Rubber product business
Sales 224,733 256,021 (12.2) -In and after the latter half of the year, production volume of Japanese automakers steeply declined in Japan, Europe and the U.S., although these automakers' production volume remained strong in China. As a result, however, the company's sales dropped.
Operating income 4,822 20,585 (76.6) -

Business in Japan
-In November 2008, the Company held a ceremony to celebrate the completion of construction of its new facility to manufacture automotive anti-vibration rubber products and resin hoses in the Oita Northern Core Industrial Park in Bungotakada-shi, Oita Prefecture. The new plant is slated to start operations in January 2009. TRI Kyushu Ltd., a subsidiary of Tokai Rubber Industries, which was established in December 2007, will manage the new plant, which is expected to generate 10 billion yen sales in fiscal 2012. The company is introducing cutting-edge production equipment at the new plant to make it one of the leading automated plants that can compete in terms of production costs with manufacturers based in low-cost countries, including new emerging countries. (From an article in the Nikkan Jidosha Shimbun on Nov. 20, 2008)


R&D Expenditure (in millions JPY)
  FY2008 FY2007 FY2006
Rubber products business 6,727 6,305 6,050

R&D Structure

The Company conducts R&D activities at the following facilities in an effort to develop new products and create new business fields:
Research station Laboratory Activities
New Business Research and Development Laboratories

*Established in August 2008 by combining "Elemental Technology Research Laboratories" and "Product Development Laboratories"
SR laboratory Development of new products and markets utilizing soft-sensor and soft-actuator technology, which use smart rubber, a new functional material.
SE laboratory Development new products in the soft electronics filed, utilizing technology for producing special coating materials and adhesives and making full use of process for making precision multilayer films.
CE laboratory Development of new products in the clean energy field, utilizing modularized technology, which involves applying high-precision processing technology to rubber materials.
ECO laboratory Creation of environmental businesses utilizing state of the art environmental technology, including technology for producing rubber materials without using fossil fuels and zero-waste materials.
Material technology research laboratories - developing new materials
Manufacturing research laboratories - developing innovating manufacturing technology

<Technopia> Completion
In July 2008, the Company held a ceremony to celebrate the completion of its Technopia technical center in Komaki City, Aichi Prefecture. The Technopia project was launched to commemorate the company's 80th anniversary, which will take place in December 2009. Located on 5,800 square meters of land on the south of the Komaki Plant (headquarters), the new technical center houses cutting-edge facilities to develop new technologies, which will help the company create new business opportunities. The total investment in this project has reached 3.2 billion yen. (From an article in the Nikkan Jidosha Shimbun on July 24, 2008)

Technical tie-up (As of Mar. 31, 2009)
<Automotive anti-vibration rubber business> Technical tie-up with Trelleborg AB (publ) in Sweden
<Automotive hose business> Technical tie-up with Hutchinson S.N.C. in France

Investment Activities

Capital Expenditure (in millions JPY)
  FY2008 FY2007 FY2006
Overall 27,437 28,487 21,011
Rubber Products Business 20,548 22,696 18,152

-In the rubber product business, the Company invested mainly in production facilities producing anti-vibration rubber and hoses at the Company's own locations as well as at TRI Kyushu Ltd.