NICHIRIN Business report FY2009

Business Highlights

Financial Overview

(in millions of JPY)
  FY2009 FY2008 Rate of Change(%) Factors
Sales 27,990 38,327 (27.0) -Sales decreased year-on-year, being impacted by a prolonged decline in vehicle production volume in major markets due to sluggish consumer spending. The drop is also attributable to negative currency translation resulting from the appreciation of the yen.
Operating income (701) 919 - -Thanks to strong sales in China, the Company's Asian operations showed a rapid recovery after April, achieving improved profitability. In Japan, North America, and Europe, however, the company's performance deteriorated because of both a large drop in sales and negative currency translation due to a stronger yen. As a result, the Group posted an operating loss, ordinary loss, and net loss.
Ordinary income (550) 942 -
Net income (1,216) 357 -

Recent Developments Outside Japan

The Company announced that it will streamline its production and sales operations in the U.S. and China through integrating the operations of its consolidated subsidiaries. The reorganization plans are intended to make the Nichirin Group leaner and more competitive in the global market. In December 2009, Nichirin Coupler TEC U.S.A. Inc. (NCT), which is producing and selling car air conditioning hose components, will absorb Nichirin-Flex U.S.A., Inc. (NFL), a supplier of automotive hoses. NCT, which will be the surviving entity, will adopt Nichirin-Flex U.S.A., Inc. as a new name. In April 2010, Nichirin Rubber Industrial (Shanghai) Co., Ltd. (NRS), which is producing and selling automotive low pressure hoses, will absorb Nichirin Flex (Shanghai) Co., Ltd., a supplier of rubber & resin hoses for household equipment. NRS will be the surviving corporation in China. (From an article in the Nikkan Jidosha Shimbun on July 7, 2009)


R&D Expenditure

(in millions of JPY)
  FY2009 FY2008 FY2007
Overall 816 1,009 1,005

Technology Licensed-out

(As of Dec. 31, 2009)

Company Country Content of Contract Period of Contract
From To
HS R&A South Korea Manufacturing technology for air conditioner hoses used in automobiles Feb. 24, 2007 Feb. 23, 2010
Manufacturing technology for automotive brake hoses Mar. 5, 2007 Mar. 4, 2010
Manufacturing technology for automotive power steering hoses Oct. 28, 2007 Mar. 4, 2010
PT.Mitra Metal Perkasa Indonesia Assembling technology for automotive brake hoses Oct. 26, 2009 Oct. 25, 2010

New Product Development

Automotive hoses
-The Company developed high-performance and more durable brake hoses, as well as Teflon SUS hoses for the aftermarket. These hoses passed the U.S. Federal Motor Vehicle Safety Standards (FMVSS).

Car air conditioning hoses
-The Company is developing hoses for air conditioning systems using HFO1234fy refrigerant, which is a prospective alternative to HFC134a fluorocarbon refrigerant that contributes to global warming.

Investment Activities

Capital Expenditure

(in millions of JPY)
  FY2009 FY2008 FY2007
Japan 258 930 695
North America 56 85 225
Asia 661 122 N.A.
Others 1 5 N.A.
Total investment 978 1,142 971

New Investment Plan

(As of Dec. 31, 2009)

Name of Company/Plant Location Equipment Estimated amount of Investment
(in millions of yen)
Project Period
From  To 
Nichirin Vietnam Co., Ltd. Bac Giang, Vietnam Production of automotive hoses 590 Dec. 2009 Apr. 2011