NIFCO Inc. Business Report FY2010

Business Highlights

Financial Overview

(in millions of JPY)
Mar. 2011)
FY2009 Rate of
Sales 120,574 107,505 12.2
Operating income 13,106 8,553 53.2
Ordinary income 12,541 8,118 54.5
Current net income 7,531 4,468 68.6
Composite plastic molded products
Sales 104,276 89,512 16.5
Operating income 15,484 10,848 42.7

<Sales in the Japanese auto industry>
The number of vehicle units produced in the first half of the year significantly increased year-on-year because of the tax reductions and sales incentives offered for eco-car purchases. As a result, the Company’s sales grew. In spite of the fact that export volume was strong during the second half of the year, sales volume in Japan decreased as a result of the eco-car sales incentives coming to an end. In addition, the Great East Japan Earthquake caused production slowdowns at its major customers, so the Company’s sales toward the very end of the fiscal year dramatically decreased. Nevertheless, for the entire fiscal year as the whole, both sales and profit were up year-on-year.

<Sales in the auto industry outside Japan>
After the economic recession, the underlying elements leading to a market recovery became more pronounced, so overall sales and operating profit grew significantly higher year-on-year.

New Companies

The Company has set up a new company to manufacture and sell synthetic resin molded components in Zhangjiagang, Jiangsu Province, China. Nifco currently operates eight facilities in China, supplying its products mainly to Japanese and Korean automakers. The new entity, which is its ninth location in China, will target non-Japanese automakers in China. The 7 million USD (approx. 600 million Japanese yen) entity was fully invested by Nifco (HK) Ltd., based in Hong Kong. (From a press release on January 27, 2011)

The Company announced that it will establish a new company for manufacture and sales of synthetic plastic products in Ezhou, Hubei Province, China in December. A new company capitalized at approximately 600 million yen will be 100 percent invested by Nifco (HK) Limited, Nifco's subsidiary in Hong Kong. The local production facility, which is expected to employ 110 workers at the end of 2011, will allow Nifco to provide expanded service to automakers operating in the midland of China. (From an article in the Nikkan Jidosha Shimbun on October. 5, 2010)

The Company announced it has established a new subsidiary in Shanghai to administer and assist 5 existing subsidiaries in China. The new company called "Nifco Enterprise Management (Shanghai) Co., Ltd." is capitalized at 2 million dollars and will provide assistance in sales and technological activities as well. (From an article in the Nikkan Jidosha Shimbun on May 11, 2010)

The Company announced that it has established two wholly-owned subsidiaries in the north and south regions of India to supply fasteners to Japanese and Korean automakers operating in the country. The company, which has been serving the Indian market by exporting the products from its nearby Asian facilities to local automakers, will respond to growing demand in the future by making inroads to the market. It is the first time for the fastener supplier to set up more than one firms simultaneously in one country. This is in response to the demand divided in the north and south in India. While production will get started in the north by the end of the year, demand will be met by imports for the time being in the south. The northern company is "Nifco India Private Limited" located in Manesar, Gurgaon, Haryana and capitalized at about 570 million yen. The southern company is "Nifco South India Manufacturing Private Limited" located in Chennai, Tamil Nadu and capitalized at about 77 million yen. (From an article in the Nikkan Jidosha Shimbun on July. 27, 2010)

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

Investment Activities

Capital Expenditure

(in millions of JPY)
  FY2010 FY2009 FY2008
Overall 9,661 5,574 11,474
Composite plastic molded products 4,137 2,367 3,865

Composite plastic molded products
The Company invested in facilities and equipment for dies and fuel-related products in order to respond to new program business from Japanese automakers. It also invested to acquire land for a new technical center.

-Nifco America Corporation invested 546 million yen mainly in fuel-related products and molding machinery and equipment.

-Nifco Korea Inc. invested 794 million yen in facilities and equipment.

-Beijing Nifco Co., Ltd. invested 780 million yen in facilities and equipment.
-In the Company invested a combined total of 1 billion, 250 million yen for facilities and equipment at Nifco (Hong Kong) Ltd.、Shanghai Nifco Plastic Manufacturer Co., Ltd.; Dongguan Nifco Co., Ltd.; and Nifco (Tianjin) Co. Ltd.

-Nifco Thailand Co., Ltd. invested 849 million yen in facilities and equipment.

Facility Construction Plans (Composite plastic molded products)

(As of Mar. 31, 2011)

Targeted Investment
Investment Amount
(in million JPY)
From To
Nifco (Tianjin) Co. Ltd.
(Tianjin, China)
Buildings and structures 715
Machinery and measuring instruments 259
Nifco UK Ltd.
(Cleveland, UK)
Buildings and structures 902
Land 137