YOROZU CORPORATION Business report FY2007
Business Highlights
| Financial overview | (in millions of JPY) |
| FY2007 | FY2006 | Rate of change (%) | Factor | |
| Sales | 118,784 | 119,310 | (1) | -Sales slightly decreased year-on-year due to a fall in sales to GM, the Company's major customer. |
| Operating Profit | 7,733 | 4,445 | 74.0 |
Operating profit increased significantly year-on-year as
a result of the following factors: |
| Ordinary profit | 6,460 | 4,540 | 42.3 | -Despite losses from exchange rate translation, ordinary profit rose from the previous year's result, supported by a large increase in operating profit. |
| Current net profit | 5,392 | 3,035 | 77.7 | -Net profit increased year-on-year because of a special extraordinary profit that resulted from selling a piece of land. |
Major Contracts (FY2007)
-Front suspension members, rear suspension members, and links for the Nissan GTR
-Front suspension members and links for the Nissan Atlas
-Stabilizer links and member stays for the Nissan X-Trail
-Suspension arms for the Honda Inspire
Domestic Development
-In Mar. 2008, the Company announced that it will be expanding its paint facility at its plant in Aichi prefecture this year to supply more products to Toyota Group companies as well as Honda Motor Co., Ltd. and Mitsubishi Motors Corporation.
>>> See Investment for more details
Overseas Development
<Asia>
-The Company set up additional stamping lines in Thailand and China as part of its expansion projects.
<North America>
-In May 2007, the Company announced that it will increase the percentage of in-house production at its Mississippi plant in the U.S. At the plant the Company will begin in the summer of 2007 manufacturing small stamped parts that have so far been outsourced and promote marketing of component units of suspensions as well as integral suspension systems, its mainstay products.
-In June 2007, the Company announced that it will embark on manufacturing in-house dies and production equipment in North America by 2010 as targeted. The in-house manufacturing of dies and production equipment will be initiated by the Company's supervising company in North America, Yorozu America Corporation headquartered in Michigan.
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Partnerships
-In Aug. 2007, the Company announced that it will transfer a 10% of stakes in Yorozu (Thailand) Co., Ltd. (YTC), its wholly owned subsidiary in Thailand, to Y-TEC Corporation, a stamped parts maker in Kaita Town, Hiroshima Pref. With this alliance the Company will increase sales at YTC while Y-TEC establishes its business base in Thailand to cope with production increase of Mazda, its major customer. The Company will transfer 1,800,000 outstanding stocks in YTC to Y-TEC, and the gain on the sale of stocks, about 440 million yen, will be recorded as extraordinary gain for the fiscal year ending March 2008. (From an article in the Nikkan Jidosha Shimbun on Aug. 25, 2007)
Business plans
Medium-term business plan "Yorozu Success Plan" through 2011
Financial targets by FY2011
On a consolidated basis:
-Sales of more than 130 billion yen
-Operating profit margin of over 6 percent
R&D
-R&D expenses amount to 1,214 million yen
in FY2007.
Technological Contracts (As of March 2008)
Technological Contracts (As of March 2008)
| Name | Country | Contract coverage | Period |
| Thyssen Krupp Automotive Talent chassis | UK | The Memorandum covers the supply of front suspensions for the GM Ypsilon, upon which Thyseen Krupp will pay fees to Yorozu contingent upon the volume of business it wins for the suspensions.. | May, 2000 - Until production of the Ypsilon in Europe is terminated |
| DK Austech Co., Ltd. | Korea | To license (on a non-exclusive basis) assembling and manufacturing technology and expertise on front suspension members, transverse links and rear suspensions for passenger cars manufactured at Renault Samsung. (The passenger car is known as the Teana in Japan.) | March 2004 - Until production of the relevant vehicle is terminated |
| Auto chassis International |
France |
The Contract covers various business activities for rear beams for passenger cars (the YN2 and the YN3) manufactured by Suzuki in France and in Europe. ACI is in charge of design and development of the relevant part and Yorozu is in charge of production engineering, preparatory work for mass-production and production activities in Japan. ACI has given Yorozu a non-exclusive license. |
January 2003 |
| The Contract covers various business activities for rear beams for a passenger car (the YN5) manufactured by Suzuki in China. ACI is in charge of design and development of the relevant part and Yorozu in charge of production engineering, preparatory work for mass-production and production activities in China (YBM). ACI has given Yorozu a non-exclusive license. |
May 2005 |
||
| Jay Bharat Maruti Ltd. | India | To sell dies and equipment to JBML relating to rear beams for the Suzuki YN4; to provide technical assistance through dispatching engineers and other means. | Seven years from January 4, 2005 |
Investment Activities
-Capital investment in FY2007 totaled 6,678million
JPY.
Capital Investment
<Japan>
-The Company invested 2,485 million yen in Japan in order to set up production lines for new vehicle models.
-In Mar., 2008, the Company announced that it will be expanding its paint facility at its plant in Aichi prefecture this year to supply more products to Toyota Group companies as well as Honda Motor Co., Ltd. and Mitsubishi Motors Corporation. Yorozu Aichi Corporation, currently generating sales of about 4 billion yen, aims to boost the sales by 25% to 5 billion yen in fiscal 2010 by increasing production capacity. The reinforced production and supply capacity in central Japan will allow the company to expand its sales to new customers and lower the ratio of its sales to Aichi Machine Industry Co., Ltd. to 40%, from the current 60%. Yorozu Aichi was established in August 2005. The Company acquired the subsidiary of Aichi Machine Industry, then-Aichi Kiko, in Minato-ku, Nagoya-shi, in September 2005 and started its operation in October. (From an article in the Nikkan Jidosha Shimbun on Mar. 28, 2008)
<North America>
-The Company invested 569 million yen in North America in order to set up production lines for new vehicle models.
-In May 2007, the Company announced that it will increase the percentage of in-house production at its Mississippi plant in the U.S. At the plant the Company will begin this summer manufacturing small stamped parts that have so far been outsourced and promote marketing of component units of suspensions as well as integral suspension systems, its mainstay products. Tandem press machines of a 200-ton level will be transferred from its Tennessee plant to save investment cost. Costs for moving existing equipment from Tennessee and setting additional equipment in Mississippi will be around 60 million yen. Yorozu intends to compensate for an impact from reduced production at the Nissan Canton plant by internal manufacturing of small stamped parts and making further efforts to expand sales to other customers. A total stamping process will be introduced to Yorozu Automotive Mississippi, Inc. (YAM, Vicksburg, Mississippi), which has been handling only assembly and painting. Starting with small stamped parts, Yorozu expects to set up a comprehensive production line at the plant in Mississippi. Products to be manufactured in-house will include brackets and chassis reinforcements. (From an article in the Nikkan Jidosha Shimbun on May.30, 2007)
-In June 2007, the Company announced that it will embark on manufacturing in-house dies and production equipment in North America by 2010 as targeted. The in-house manufacturing of dies and production equipment will be initiated by the Company's supervising company in North America, Yorozu America Corporation headquartered in Michigan. While it continues to rely for supply of prototype products on local manufacturers, which are densely located in certain areas in the U.S., Yorozu America has started investigation to focus on in-house manufacturing operation of dies and production equipment. Performance test and evaluations of the products will be conducted at its North American production sites including Yorozu Automotive Tennessee (YAT in Morrison, Tennessee). The Company has already started in-house production of dies, jigs and tools at its plant in Thailand, Yorozu Engineering Systems (Thailand), which is located in the Eastern Seaboard Industrial Estate in Rayong. It is also planning to complete preparation for in-house manufacturing of large and small metallic stamping dies at its Chinese plant in Guangzhou, China by 2009. The internal manufacturing rate is expected to rise in three regions: in Japan, the U.S. and Asia by 2010. (From an article in the Nikkan Jidosha Shimbun on Jun.19, 2007)
<Asia>
-Following the project to expand its facility in Thailand in FY2006, the Company set up new tandem press lines, one 700-ton and the other 400-ton, at the Thai facility. In addition, for the purpose of conducting die production in-house and reinforcing its development capability, the Thai facility revamped its CAD system, which doubled its design capacity.
-In China, the Company expanded its facility and added 800-ton and 400-ton tandem press lines in the first half of FY2007. The Chinese plant is now producing components for four new vehicle models.
-Capital investment in Asia totaled 3,623 million yen in FY2007.
New facilities at a glance
Capital Investment
<Japan>
-The Company invested 2,485 million yen in Japan in order to set up production lines for new vehicle models.
-In Mar., 2008, the Company announced that it will be expanding its paint facility at its plant in Aichi prefecture this year to supply more products to Toyota Group companies as well as Honda Motor Co., Ltd. and Mitsubishi Motors Corporation. Yorozu Aichi Corporation, currently generating sales of about 4 billion yen, aims to boost the sales by 25% to 5 billion yen in fiscal 2010 by increasing production capacity. The reinforced production and supply capacity in central Japan will allow the company to expand its sales to new customers and lower the ratio of its sales to Aichi Machine Industry Co., Ltd. to 40%, from the current 60%. Yorozu Aichi was established in August 2005. The Company acquired the subsidiary of Aichi Machine Industry, then-Aichi Kiko, in Minato-ku, Nagoya-shi, in September 2005 and started its operation in October. (From an article in the Nikkan Jidosha Shimbun on Mar. 28, 2008)
<North America>
-The Company invested 569 million yen in North America in order to set up production lines for new vehicle models.
-In May 2007, the Company announced that it will increase the percentage of in-house production at its Mississippi plant in the U.S. At the plant the Company will begin this summer manufacturing small stamped parts that have so far been outsourced and promote marketing of component units of suspensions as well as integral suspension systems, its mainstay products. Tandem press machines of a 200-ton level will be transferred from its Tennessee plant to save investment cost. Costs for moving existing equipment from Tennessee and setting additional equipment in Mississippi will be around 60 million yen. Yorozu intends to compensate for an impact from reduced production at the Nissan Canton plant by internal manufacturing of small stamped parts and making further efforts to expand sales to other customers. A total stamping process will be introduced to Yorozu Automotive Mississippi, Inc. (YAM, Vicksburg, Mississippi), which has been handling only assembly and painting. Starting with small stamped parts, Yorozu expects to set up a comprehensive production line at the plant in Mississippi. Products to be manufactured in-house will include brackets and chassis reinforcements. (From an article in the Nikkan Jidosha Shimbun on May.30, 2007)
-In June 2007, the Company announced that it will embark on manufacturing in-house dies and production equipment in North America by 2010 as targeted. The in-house manufacturing of dies and production equipment will be initiated by the Company's supervising company in North America, Yorozu America Corporation headquartered in Michigan. While it continues to rely for supply of prototype products on local manufacturers, which are densely located in certain areas in the U.S., Yorozu America has started investigation to focus on in-house manufacturing operation of dies and production equipment. Performance test and evaluations of the products will be conducted at its North American production sites including Yorozu Automotive Tennessee (YAT in Morrison, Tennessee). The Company has already started in-house production of dies, jigs and tools at its plant in Thailand, Yorozu Engineering Systems (Thailand), which is located in the Eastern Seaboard Industrial Estate in Rayong. It is also planning to complete preparation for in-house manufacturing of large and small metallic stamping dies at its Chinese plant in Guangzhou, China by 2009. The internal manufacturing rate is expected to rise in three regions: in Japan, the U.S. and Asia by 2010. (From an article in the Nikkan Jidosha Shimbun on Jun.19, 2007)
<Asia>
-Following the project to expand its facility in Thailand in FY2006, the Company set up new tandem press lines, one 700-ton and the other 400-ton, at the Thai facility. In addition, for the purpose of conducting die production in-house and reinforcing its development capability, the Thai facility revamped its CAD system, which doubled its design capacity.
-In China, the Company expanded its facility and added 800-ton and 400-ton tandem press lines in the first half of FY2007. The Chinese plant is now producing components for four new vehicle models.
-Capital investment in Asia totaled 3,623 million yen in FY2007.
New facilities at a glance
| Business establishment | Purpose | Planned investment (thousand yen) |
Start | Planned completion |
| Submitting companies | ||||
| Headquarters (Kanagawa, Japan) |
Installing facilities for new vehicle models | 735 | Apr. 2008 | Mar. 2009 |
| Subsidiaries | ||||
| Yorozu Automotive Tennessee, Inc. (USA) | Installing facilities for new vehicle models | 1,347 | Jan. 2008 | Dec. 2008 |
| Yorozu Mexicana SA. de C.V. | -Installing facilities for new vehicle models -Renewing general equipment |
616 | Jan. 2008 | Dec. 2008 |
| Yorozu (Thailand) Co.,Ltd. | Facilities for new vehicle models | 1,315 | Jan. 2008 | Dec. 2008 |
| Yorozu Engineering Systems (Thailand) Co., Ltd. | -Renewing general equipment | 672 | Jun. 2008 | Dec. 2008 |