Nichirin Co., Ltd.
-An independent, leading manufacturer of hoses for automobiles and motorcycles. The Company supplies nearly 100% of all brake hoses and clutch hoses for motorcycles that are required in Japan.
-In FY ended Dec. 2016, consolidated sales were JPY 50,992 million, operating income was JPY 6,618 million, ordinary income was JPY 6,343 million, and net income was JPY 3,644 million.
Factors by Region
Even though sales were strong in Japan and the Company delivered higher product volumes to VW, the overall sales volume of JPY 28,781 million remained flat for the year (compared to JY 28,726 million in FY2015) due to negative currency translation because of the strong Japanese yen. As a result, operating income also decreased year-over-year (y/y), down to JPY 1,562 million compared to JPY 1,613 million in FY2015.
The automotive market remained strong due to the continued low gasoline prices that had started from the previous year and which ended up driving sales higher on a USD basis. However, due to negative currency translation due to the strong yen, sales overall (JPY 13,103 million) decreased y/y, compared to JPY 13,830 in FY2015. Ordinary income, which was JPY 927 million, fortunately increased y/y (JPY 567 million FY2015) because of improved productivity due to the introduction of robotic production lines and reduced logistics costs.
In the automotive market, new-vehicle sales increased due to tax reductions on compact vehicles and greater demand for SUVs. As a result, overall sales on a CNY basis increased y/y. However, due to negative currency translation because of the strong Japanese yen, overall sales (JPY 9,175 million) were lower than FY2015 sales, which were JPY 9,319. Ordinary income, thanks to initiatives to improve productivity, increased slightly y/y to JPY 1,109 million, compared to JPY 1,012 million in FY2015.
Overall sales were JPY 11,683 million, which were lower compared to JPY 11,822 million in FY2015. Nevertheless, thanks to strong sales of motorcycle brake-hoses, sales launches of new fuel hoses, and greater sales to GM in Vietnam, ordinary income increased y/y to JPY 2,806, compared to JPY 2,743 in FY2015.
Overall sales increased to JPY 3,102 million, compared to sales of JPY2,607 in FY2015, and ordinary income increased to JPY 117 million, compared to JPY 80 million in FY2015. This was the favorable result of higher sales due to increased orders from European OEMs and turning Hutchinson Nichirin Brake Hoses into a consolidated subsidiary in Oct. 2016.
Hutchinson Nichirin Brake Hoses converted into consolidated subsidiary
-In Oct 2016, the Company announced that it has turned Hutchinson Nichirin Brake Hoses, S.L. (HNBH), its joint venture with the French auto parts supplier Hutchinson S.A. (Hutchinson), into a consolidated subsidiary. Nichirin has acquired 40% of the shares of HNBH from Hutchinson and increased its stake in it from the previous 30% to 70% for approximately EUR 6 million. In 2012, Nichirin entered into a joint venture agreement and shareholders' agreement with Hutchinson for purposes including expanding sales to European OEMs. In 2013, Nichirin took an equity stake in HNBH, and has expanded its joint venture operations. As a result, HNBH has been expanding its business as initially planned, with examples including winning a deal with General Motors Company for Nichirin's Vietnamese subsidiary, and clinching a large order more recently. Sales for 2015 reached EUR 21.7 million. Given this situation, Nichirin has increased its stake in HNBH according to plan and in line with its shareholders' agreement with Hutchinson. (From an article in the Nikkan Jidosha Shimbun on October 24, 2016)
Mid-term Management Plan "NICHIRIN Growth Strategy 2020"
-In Nov. 2014, they Company drew up mid-term management plan "2015 - 2020: Nichirin Growth Strategy 2020: NGS2020"
<2020 Consolidated management guideline>
- Sales: 30% increase since 2013
- Operating margin: stably achieve 8% or higher margin
- Net profit margin: stably achieve 5% or higher margin
- Capital-to-asset rate: 50% or higher
|-Listed on the Second Section of the Tokyo Stock Exchange.||(As of Dec. 31, 2016)|
|Name or Company name||Investment Ratio (%)|
|Taiyo Koko Co., Ltd.||22.96|
|Japan Trustee Services Bank, Ltd. (Trust Account)||4.59|
|BNP PARIBAS SECURITIES SERVICES LUXEMBOURG/JASDEC/FIM/LUXEMBOURG FUNDS||3.62|
|Tokyo Century Corporation||3.31|
|Mizuho Bank Ltd.||2.60|
|Nippon Fine Chemical Co., Ltd.||1.99|
|THE HONGKONG AND SHANGHAI BANKING CORPORATION LIMITED CLIENTS A/C 513 SINGAPORE CLIENTS||1.48|
|Mizuho Investors Securities Co., Ltd.||1.36|
|Employees' ownership association||1.22|
-Hydraulic brake hoses
-Ultra low-expansion brake hoses
-Brake oil reservoir hoses
-Air conditioning hoses
-Power steering hoses
-Fluid hoses for automatic transmissions
-Air brake hoses
-Electric Stability Control hoses
-CO2 refrigerant air conditioning system hoses "EF-TUBE"
-Hydraulic hoses for roll control system
-Oil cooler hoses
-Urea SCR hoses
-Vacuum brake hoses
-Torque converter hoses
-Engine oil hoses
-Hoses for auto cruise system
|May, 1914||Founded manufacturing business of bicycle tires, tubes, various rubber hoses and industrial rubber products under the name of Nippon Ringyo Goshi Company in Kobe, Japan.(Initial capital: 100,000 yen)|
|Mar. 1924||Changed the company name to Nippon Ringyo Co., Ltd.|
|Feb. 1931||Changed the company name to Nippon Ringyo Gomu Co., Ltd.|
|May, 1934||Started making phenolic molding products for manufacturing artificial silk in Osaka.|
|Apr. 1937||Began manufacturing business of high pressure hoses for aircraft and rubber hoses for automobiles.|
|1941-1943||Established additional plants in Osaka, Tsutsui (Kobe), Himeji city to increase production capacity of aircraft hoses and oil resistant seal products.|
|Mar. 1943||Established Tokyo office to promote sales activities in the eastern region of Japan.|
|Aug. 1943||Changed the company name to Nichirin Rubber Industrial Co., Ltd.|
|Aug. 1945||All facilities were destroyed during World War 2.|
|Aug. 1945||All the plants burned down due to the war.|
|Mar. 1946||Re-established a new facility in Himeji city and continued manufacturing business.|
|Apr. 1957||Started production of car air conditioning hoses.|
|Apr. 1965||Started production of power steering hoses.|
|Apr. 1967||Started production of hydraulic brake hoses for use in motorcycles.|
|Mar. 1970||The Himeji Factory was moved from Hojo, Himeji City, because of the Sanyo Shinkansen project. The plant started operations at the new site in Bessho-cho in the same city.
The Company discontinued production of motorcycle tire tubes and hoses for railcars.
|Nov. 1975||Raised capital to 100 million yen.|
|Oct. 1986||Established overseas affiliate, "Sunchirin Industry (M) Sdn. Bhd." in Malaysia. (Currently, Sunchirin Industries (Malaysia Berhad)|
|Feb. 1987||Established overseas subsidiary, "Nichirin Inc." in Canada.|
|July, 1989||Established overseas subsidiary, "Nichirin-Flex U.S.A., Inc." in the United States.|
|Sep. 1989||Moved the Tokyo office to Shibaura, Minato ward, Tokyo.|
|July, 1991||Changed the company name to "Nichirin C., Ltd."|
|Jun. 1994||Established overseas affiliate, "Nichirin (Thailand) Co., Ltd." in Thailand.|
|Aug. 1995||Moved its headquarters to Sannomiya, Chuo-ku, Kobe City.|
|Oct. 1995||All the hose operations at the Himeji Plant obtained ISO9001 certification.|
|July, 1996||Sunchirin Industries (Malaysia) Berhad (an affiliated company in Malaysia) was listed on the second section of the Kuala Lumpur Stock Exchange.|
|Dec. 1996||Established ShanghaiI Nichirin Automobile Accessories Co., Ltd. as a local subsidiary in China.|
|Aug. 1997||Listed on the second section of the Osaka Stock Exchange.|
|Oct. 1998||Established Nichirin Coupler Tech USA Inc. as a local subsidiary in the United States.|
|Feb. 1999||Established Nichirin UK Limited as a local subsidiary in England.|
|Jul. 2001||Established a joint venture in the Czech Republic with Visteon, Visteon Nichirin Czech SRO.|
|Feb. 2002||Obtained ISO14001 certification.|
|Apr. 2002||Jointly with Nichirin Inc. established Nichirin Tennessee Inc, a new company which manufactures brake and power steering hoses for use in passenger cars and motorcycles in Tennessee, USA.|
|July, 2004||Absorbed Nichirin Kohan Co., Ltd., its subsidiary established in June 1966.|
|Nov. 2004||Established Nichirin Flex (Shanghai) Co., Ltd. in China.|
|Feb. 2005||Acquired ISO/TS16949: 2002 Certification.|
|Aug. 2005||Established Nichirin Rubber Industrial (Shanghai) Co., Ltd) in China.|
|Nov. 2005||The Company issued an additional 1 million shares, increasing the number of outstanding shares to 9 million and registered capital to 1,729 million yen.|
|Apr. 2006||Established the Nichirin R&D center within the premises of the Himeji plant.|
|May 2008||Established Nichirin Vietnam Co., Ltd. in Vietnam.|
|Oct. 2010||Established Nichirin Autoparts India Pvt., Ltd. in India.|
|Apr. 2011||The Company established PT. Nichirin Indonesia, a subsidiary in Indonesia.|
|Feb. 2013||Established overseas office Hutchinson Nichirin Brake Hoses, S.L. in Spain.|
|Feb. 2013||Announced that it plans to close and liquidate its Canada-based subsidiary, Nichirin Inc., effective June 30, 2013.|
|July 2013||Listed on the second section of the Tokyo Stock Exchange after the market of the Osaka Securities Exchange was integrated with that of the Tokyo Stock Exchange.|
|Oct. 2016||Converted Hutchinson Nichirin Brake Hoses, S.L., a joint venture with France-based Hutchinson S.A., into a consolidated subsidiary by increasing stake in the company from 70% from the previous 30%.|
Supplemental Information 1
Technology Licensed-out Agreement
|(As of Dec. 31, 2016)|
|Company||Country||Content of Contract||Period of Contract|
|Hwaseung R&A Co.,Ltd.||South Korea||Manufacturing technology for air conditioner hoses used in automobiles||Mar. 5, 2016||Mar. 4, 2019|
|Manufacturing technology for automotive brake hoses||Mar. 5, 2016||Mar. 4, 2019|
|Manufacturing technology for automotive power steering hoses||Mar. 5, 2016||Mar. 4, 2019|
>>>Business report FY ended Dec. 31, 2007
>>>Business report FY ended Dec. 31, 2008
>>>Business report FY ended Dec. 31, 2009
>>>Business report FY ended Dec. 31, 2010
>>>Business report FY ended Dec. 31, 2011
>>>Business report FY ended Dec. 31, 2012
>>>Business report FY ended Dec. 31, 2013
>>>Business report FY ended Dec. 31, 2014
>>>IR information of Nichirin Co., Ltd.
>>>Financial Forecast for the Next Fiscal Year (Sales, Operating Income etc.)
Note: A figure in brackets ( ) indicates a loss