NOK Corporation Business Report FY2009

Business Highlights

Financial Overview

(in million JPY)
  FY 2009 FY 2008 Rate of
Change (%)
Sales 414,753 466,694 (11.1) -
Operating income 12,655 7,441 70.1 -
Ordinary income 10,363 6,174 67.8 -
Current net income 1,279 652 96.2 -
Sealing product division
Sales 226,708 249,910 (9.3) -Sales were slow at the beginning of the term, but as demand for new cars grew mainly in China and other emerging countries, sales of items for automotive applications improved. Sales for the entire year, however, decreased because the improvement in the second half was not enough to offset the steep decline in sales during.
Operating income 8,285 4,268 94.1 -

Recent Developments in Japan

-The Company has decided to keep its Shizuoka Plant, Makinohara, Shizuoka Pref., Japan, which had been scheduled for a closure at the end of 2010. While production of the large-diameter seal products, which has promising demand, will be transferred to its Fukushima Plant, it will downscale and keep the Shizuoka Plant for production of boots and dust covers, manufactured so far at its subsidiaries in the Shizuoka area. NOK has also decided on survival of its Saga Plant, Miyaki-cho, Saga Pref., another target for reorganization of its production operations in Japan, whose operation will be commissioned to a subsidiary. The Company will therefore manage its own six plants and hold the seven plants on a consolidated basis. (From an article in the Nikkan Jidosha Shimbun on Oct. 8, 2009)

Recent Developments outside Japan

-The Company is planning to reorganize its auto parts production operations in Thailand. Specifically, the Company is mulling the possibility of consolidating its two facilities, the one in Suphanburi Province and the other in the Amata Nakorn Industrial Estate, Chonburi Province, to the latter, which is much larger than the former. The Company is intending to close down its Suphanburi operation, a small plant specializing in O-ring production, since the facility has now become quite old after 20 years of operations. The product line at the Amata Nakorn Plant, which is 100,000 square meters in size, includes O-rings; oil seals, which are the Company's major products; and torsional dampers. The facility is capable of producing components used in these products such as anti-vibration rubber and cast parts as well. It also has a distribution center on the premises. (From an article in the Nikkan Jidosha Shimbun on Nov. 25, 2009)

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


R&D Expenditure

(in million JPY)
  FY2009 FY2008 FY2007
Overall 6,433 7,952 9,149
Seal products 4,689 6,456 7,600

R&D Activities

Sealing product division
-The Company developed and released new low friction oil seals for automotive applications.
-The Company has already commercialized some encoding seals, which use magnetic rubber. These seals are being used to integrate control functions such as speed control. The Company is now developing encoders with greater functions as a way to expand their applications further.
-The Company was successful in commercializing some encoding seals (which use magnetic rubber) used for integrated vehicle control. This includes controlling the vehicle's speed, for example. The Company is currently developing encoders, giving them more precision-level magnetization and greater functions, creating multi-task encoders.
-The Company supplies products for EVs and HEVs. These include metal gaskets, rubber-only gaskets for power control units (PCUs), and seals for secondary batteries. It is also developing new electromagnetic shields such as soft metal gaskets (SMG-type EM guards) and electromagnetic wave seals (seals and shields) combined with rubber gaskets for next-generation vehicles.

R&D Facilities

Shonan Development Center Kanagawa Pref., Japan

Technical Cooperation Agreement

(As of Mar. 31, 2010)

Partner Content Signed on
Freudenberg& Co. KG
Introduction and licensing of such seal product as oil seal, O ring and related technologies Jan. 1, 2009

Investment Activities

Capital Expenditure

(in million JPY)
  FY2009 FY2008 FY2007
Overall 18,232 57,463 60,881
Seal products 11,666 35,118 38,986

Sealing business
-The Company made capital investments mainly at its oil seal manufacturing plant in Fukushima in Japan; Thai NOK Co., Ltd.; NOK Precision Component Thai, Ltd.; and Wuxi NOK Freudenberg Co., Ltd.
-The Company will hold down its capital investment for the year ending in March 2011 to less than 10 billion yen. The level is even much lower than the estimated amount for 2009, when spending is likely to drop 50 percent from 2008. Until then, the Company continued to spend heavily to increase production. Projecting that the level of vehicle production is unlikely to recover dramatically within the next couple of years, the Company has decided to make effective use of its existing production infrastructure in order to meet demand fluctuations. The current production structure was established by the year ended in March 2008. (From an article in the Nikkan Jidosha Shimbun on Oct. 19, 2009)