Kayaba Industry Co., Ltd. (KYB) Business Report FY2012
Business Highlights
Financial Overview |
(in millions of JPY) |
| FY ended Mar. 31, 2012 | FY ended Mar. 31, 2011 | Rate of Change (%) |
Factors | |
| Overall | ||||
| Sales | 337,158 | 320,082 | 5.3 | - |
| Operating income | 21,537 | 24,151 | (10.8) | - |
| Ordinary income | 22,755 | 23,972 | (5.1) | - |
| Current net income | 13,897 | 17,014 | (18.3) | - |
| Automotive Components Unit | ||||
| Sales | 186,664 | 186,795 | (0.1) | 1) |
| Operating profit | 6,154 | 10,181 | (39.6) | - |
Factors
1) AC (Automotive Components) Business
Hydraulic Shock-absorbers for Four-wheel Vehicles
-The operating revenue at the four-wheel shock absorber business ended up just slightly lower year-on-year, by 1.0%, to 117.9 billion yen. Even though business recovered from the debilitating effects of the Great East Japan Earthquake and the flooding in Thailand, revenue dropped because of lower sales in Europe due to the unstable financial crisis there.
Hydraulic Equipment for Four-wheel Vehicles
-As for the business performance of power-steering products, the Company's main hydraulic equipment for four-wheel vehicles, the Company had strong sales of pumps for CVTs. Nevertheless, demand for hydraulic pumps decreased because of electrification of steering systems by EPS, and sales in Europe were significantly lower because of the financial crisis occurring there. As a result, operating revenue was 35.9 billion yen, a year-on-year decrease of 6.9%.
Recent Development Outside Japan
<Europe>-The Company announced on February 7, 2012 that it will establish a new holding company to support and administer its group companies operating in Europe by acquiring their stocks. Existing subsidiaries in Europe will be placed under management of the new holding company “KYB Europe Headquarters B.V., which will be established in Limburg Province the Netherlands in April. A one million-euro (approximately 100 million yen) capital for the new company will be wholly paid by KYB. The current affiliates in Europe that will become subsidiaries of the new company include KYB Suspensions Europe that was established in Spain in 1975, KYB Manufacturing Czech that was set up in the Czech Republic in 2003, two other companies in Spain and two companies in Germany. (From an article in the Nikkan Jidosha Shimbun on February 9, 2012)
<USA>
-The Company announced on September 22 that KYB Manufacturing North America, Inc. (KMNA), its wholly owned subsidiary producing and selling automotive shock absorbers in Indiana will merge KYB America, LLC (KAC) into its own operations. KAC, a sales company handling shock absorbers and hydraulic equipment in Illinois, is owned 100 percent by KMNA. The consolidation of the two companies is intended to improve the group's management efficiency in production and sales and generate new synergies. KMNA and KAC will be merged effective October 1 and registered under a new corporate name, KYB Americas Corporation on October 3. The new shock absorber production and sales company will also sell hydraulic equipment. KYB will position KYB Americas as the hub of its operations in North and Central America, aiming to further step up its presence in the market.(From an article in the Nikkan Jidosha Shimbun on September 26, 2011)
<Brazil>
-The Company announced its joint venture project in Brazil with Mando Corp., a Korean automotive parts supplier. It aims to strengthen its operations in Brazil through pursuing synergy effects in the automotive shock absorber business. It will transfer 50% of shares of KYB do Brasil Fabricante de Autopeｃas Ltda. (KBFA), its 100% subsidiary in Brazil, to Mando Corp. to establish a joint venture company, KYB-Mando do Brasil Fabricante de Autopeｃas S.A., in State of Paraná on May 31. The joint venture will be capitalized at R$ 24.4 million (approx. 1.28 billion yen). The parent companies, which both have an automotive shock absorber business, have decided that sharing their management resources and know-how in the growth-expected Brazilian market should generate synergy effects to help expand their businesses. (From an article in the Nikkan Jidosha Shimbun on April 25, 2011)
Mid-term Business Plans
-The Company announced its mid-term business plan covering a three-year period ending March 2014. The Company aims to generate 400 billion yen in sales and achieve an operating profit margin of over 8 percent in the final year of the plan. The Company is going to invest 77.7 billion yen during the term to increase its capacity to manufacture hydraulic system products for construction machinery at home and abroad. Major targets at the Company's automotive components division include boosting the ratio of overseas sales to 50 percent from the current 42 percent and doubling sales of shock absorbers in the OEM market. (From an article in the Nikkan Jidosha Shimbun on June 15, 2011)>>>Financial Forecast for the Next Fiscal Year (Sales, Operating Income etc.)
R&D
R&D Expenditure |
(in millions of JPY) |
| FY ended Mar. 31, 2012 | FY ended Mar. 31, 2011 | FY ended Mar. 31, 2010 | |
| Overall | 4,035 | 3,218 | 2,816 |
| AC (Automotive Components) Operations | 2,401 | 1,733 | - |
R&D Structure
| Facility | Location | Research Activities |
| KYB development and testing center | Kamo-gun, Gifu Pref. |
Development and testing of suspensions and steering devices for four- and two-wheel vehicles |
| Basic Technology Center | Sagamihara City, Kanagawa Pref. | Conducting basic research on hydraulic equipment and automobile devices and developing new products and technologies. |
| Product Engineering Center | Kani City, Gifu Pref. |
In charge of development activities that improve product appeal such as enhancing performance and reducing costs, etc. |
KYB development and testing center
-The Company announced on July, 2011 that it has completed construction of its new proving ground in Gifu for the development and testing of automotive and motorcycle components. The company will open the new testing ground called the KYB development and testing center on July 14, which is expected to enhance the company's capabilities for developing high-performance suspension, steering and electronic systems with excellent reliability. The testing center covers an area of 595,000 square meters in Kamo-gun, Gifu Prefecture. It has a 1-kilometer long mountain road with many uphills and downhills, a circular road having a maximum radius of 105 meters, and straight-line roads with various surface conditions. In addition, it has a special proving course, which allows testing of various vehicle behaviors and evaluate any abnormal noise, and a maintenance building. KYB broke ground for this testing center in August 2008 with a plan to complete construction in April 2010. The construction project, however, was temporarily put on hold due to the impact of the global financial crisis. The company has spent approximately 2.7 billion yen in constructing the whole testing center. (From an article in the Nikkan Jidosha Shimbun on July 9, 2011)
R&D Activities
AC (Automotive Components) OperationsSteering equipment for four-wheel vehicles
-The Company won new business from Chrysler, developing a pump for the automaker's 4KS2 power-steering system. The Company is now delivering this pump for mounting on "Jeep Wrangler". This aluminum pump, which can be manufactured on a standard production line that is becoming to be used more widely in the world, is for the 4K aluminum series pumps in which a more flexible application design is possible.
Electric Power-streering Systems (EPS)
-The Company developed and is now delivering an EPS system for "i-MiEV", an electric vehicle (EV) being built by Mistubishi Motors for sale in North America. The Company is also building an EPS for "i-MiEV" that will be marketed in Europe. The EPS for the North American model is based on the one built for Europe, but the tie-rods were made longer to fit the wider- body of the European i-MiEV.
Technology Licensing-out Agreement |
(As of Mar. 31, 2012) |
| Contract party (Country) |
Subject | Details | Term |
| Kayaba-UMW Malaysia Sdn. Bnd. (Malaysia) |
Shock absorbers for automobiles, front forks units for two-wheeled vehicles, and oil cushion | 1.Licensing of industrial property right 2.Licensing of manufacturing and distributorship rights 3.Provision of technical expertise, information and know-how |
Oct. 13, 1993 - Oct. 12, 2012 |
| P. T. Kayaba Indonesia (Indonesia) |
Shock absorbers for automobiles, front forks units for two-wheeled vehicles, and oil cushion | 1.Licensing of industrial property rights 2.Licensing of manufacturing and distributorship rights 3.Provision of technical expertise, information and know-how |
Feb. 1, 2010 - Jan. 31, 2014 |
| KYB (Thailand) Co., Ltd. (Thailand) |
Shock absorbers for automobiles, front forks units for two-wheeled vehicles, and oil cushion | 1.Licensing of industrial property rights 2.Licensing of manufacturing and distributorship rights 3.Provision of technical expertise, information and know-how |
Feb. 1, 2012 - Jan. 31, 2013 |
| KYB Americas Corporation (USA) |
Shock absorbers for automobiles | 1.Licensing of industrial property rights 2.Licensing of manufacturing and distributorship rights 3.Provision of technical expertise, information and know-how |
Oct. 1, 2011 - Sept. 30, 2012 |
| KYB Steering Spain, S.A. (Spain) |
Automobile hydraulic equipment | 1.Licensing of industrial property rights 2.Licensing of manufacturing and distributorship rights 3.Provision of technical expertise, information and know-how |
Jan. 01, 2011 - Dec. 31, 2015 |
| KYB Suspensions Europe, S.A. (Spain) |
Shock absorbers for automobiles | 1.Licensing of industrial property rights 2.Licensing of manufacturing and distributorship rights 3.Provision of technical expertise, information and know-how |
Oct. 1, 2011 - Sept. 30, 2012 |
Investment Activities
Capital Expenditure |
(in millions of JPY) |
| FY ended Mar. 31, 2012 | FY ended Mar. 31, 2011 | FY ended Mar. 31, 2010 | |
| Overall | 27,172 | 8,915 | 10,081 |
| AC (Automotive Components) Operations | 9,378 | 3,988 | - |