103 rd Term Annual Report

Transcription

1 103 rd Term Annual Report 2017 Fiscal Year Fiscal Period Beginning April 1, 2017 Ending March 31, 2018 Moriroku Holdings Company, Ltd. Securities Code:

2 Message to Our Shareholders In the automobile market, which constitutes the principal business domain of the Moriroku Group, although sales of automobiles in the United States entered a phase of deceleration following a hike in interest rates and other factors, due largely to the impact of ongoing tax reduction measures for small automobiles in China, unit sales of President, CEO & new automobiles in that country progressed favorably, and showed a stable increase. Shigenobu Miwa Sales of automobiles recovered moderately in Japan as well, and in the Asia region, particularly Thailand, there was a visible upswing in automobile sales. Amid such circumstances, in our Resin-Treated Products Business and Chemicals Business, our business in resinmolded components and raw materials for automobiles grew mainly in China and Thailand; furthermore, in Japan, we saw an improvement in orders received and sales of those components due to unit sales of automobiles trending towards recovery. Conversely, in the United States, although sales of automobiles by our principal clients were gravitating towards recovery, we experienced increases in costs associated mostly with the mass-production of new models in our Resin- Treated Products Business. As a result of the above, the consolidated business performance of the Moriroku Group came to net sales of billion JPY, or +7.2% year on year; operating income of 9.4 billion JPY, or +48.9% year on year; ordinary income of 9.2 billion JPY, or +54.6% year on year; and net income attributable to owners of the parent of 6.8 billion JPY, or % year on year. These results exceeded our initial targets for the term. Additionally, having taken these results, our operating environment and so forth into total consideration, the Moriroku Group has elected to distribute fiscal year-end dividends of 90 JPY per share (last fiscal year: 22.5 JPY per share), representing an increase of 10 JPY over our announced dividend forecast. 1 Greetings I would like to begin by extending my sincere gratitude for your ongoing support of the Moriroku Group. On December 20, 2017, the Moriroku Group listed its shares on the First Section of the Tokyo Stock Exchange. This achievement was made possible thanks to the customers, shareholders and everyone else who lent their support to the Group up to now. Summary of 103rd Term and Dividends for Term By going public, the Moriroku Group has taken a new major step in its 350-year history. Our officers and employees will keep endeavoring to further expand our business and enhance our corporate value in the name of becoming a company with a 400-year history as we aggressively tackle new challenges and transform our business structure. We at the Moriroku Group hope to continue benefiting from the ongoing support and cooperation from you as our valued shareholders with respect to those endeavors. 350 years of history is proof of how we have continued unceasingly to take on challenges and create value.

3 Consolidated Financial Highlights Net Sales/Overseas Net Sales Ratio (Unit: 00 million JPY) (Unit: 00 million JPY) Ordinary Income 100 th Term 101 st Term 102 nd Term 103 rd Term (FY2014) (FY2015) (FY2016) (FY2017) 100 th Term 101 st Term 102 nd Term 103 rd Term (FY2014) (FY2015) (FY2016) (FY2017) Net Income Attributable to Owners of Parent Dividends per Share/Total Dividends (Unit: 00 million JPY) (Unit: JPY) Ordinary dividends Total dividends ( 00 million JPY) Posted 1.9 bln JPY in impairment losses 100 th Term 101 st Term 102 nd Term 103 rd Term (FY2014) (FY2015) (FY2016) (FY2017) Net Sales by Business 100 th Term 101 st Term 102 nd Term 103 rd Term (FY2014) (FY2015) (FY2016) (FY2017) * On October 4, 2017, the Moriroku Group conducted a stock split in which it divided each of its shares into two shares. Dividends per share up to the 102 nd Term (FY2016) have been computed with the hypothesis that said stock split had been conducted. Net Sales by Region Chemicals Business 36.9% (67.1 bln JPY) Consolidated net sales bln JPY Resin-Treated Products Business 63.1% (114.9 bln JPY) Asia (Europe incl.) 31.7% (57.6 bln JPY) NA 3.3% (60.6 bln JPY) Consolidated net sales bln JPY Japan 35.0% (63.8 bln JPY) 2

4 Business-Specific Review Resin-Treated Products Business Manufacturing sites Development sites Total Japan Overseas Net 売上 Sales Unit: 00 million JPY Operating Income Unit: 00 million JPY 2017 Second plant in India enters full-scale operation Feb 2018 Second plant in China s Wuhan area completed Main Products (Interior) (Interior) (Exterior) Center panel Center console Side sill (In front of driver s and (In between front seats) (Under doors) front passenger s seats) May 2017 Mass-production commenced at Mexico plant 102 nd Term 103 rd Term 102 nd Term 103 rd Term (FY2016) (FY2017) (FY2016) (FY2017) Net sales bln JPY (+9.8% YoY) Operating income 8.0 bln JPY (+56.4% YoY) Under the Moriroku Group s Resin-Treated Products Business, orders for and sales of resin-molded components for automobiles steadily grew as a result of the favorable performance of unit sales of new automobiles in China and Thailand coupled with an upswing in automobile sales in Japan relative to the previous year. Conversely, in the United States, although sales of automobiles by our chief clients trended towards recovery, we experienced increased costs largely stemming from the mass-production of new models. Also, in addition to commencing mass-production at our Mexico plant, coming off of the completion of our second plant in China s Wuhan area, we endeavored to expand our manufacturing infrastructure globally. Moreover, we proceeded to carry out initiatives for bolstering our competitiveness, such as developing new product domains and addressing needs to make EV/PHV more lightweight in order to promote those vehicles. Turning plants into high-efficiency production sites through promoting automation and man-saving initiatives With the transfer of operations from our three plants in the Kanto region and the consolidation of those operations at our new Kanto plant having wrapped up in Spring 2017, the full-scale operation of the new plant got underway. In order to realize high-efficiency production at that new plant, we have been promoting automation and man-saving endeavors there though means such as introducing the use of robots. Our second plant in China s Wuhan area was completed in February At that plant as well, we have been implementing our expertise in automation, man-saving initiatives and streamlining that we have cultivated at our Japan-side plants in our endeavors to further enhance the high-efficiency manufacturing constitution at the Wuhan plant. Expanding on our business partners in North America Introduced use of robots primarily in assembly lines (image representation) As part of our efforts to expand on sales channels in North America, we commenced mass-production of outlets (the vent part of vehicular A/Cs) at our Mexico plant in May That mass-production has gotten off to a smooth start. In addition, to accommodate increases in production, we plan on building an additional factory at the Mexico plant and augmenting its molding and coating lines. Also, with our new, second plant in India that was completed in 2016 also having entered full operation, we reinforced our business on a global basis. Outlet (Vent part of A/Cs) 3

5 Chemicals Business Main products Global release Monozukuri (shop floor manufacturing) Net Sales Unit: 00 million JPY Operating Income Unit: 00 million JPY Bellows Raw resin materials for automobiles Sunroof Raw coating materials Resin products released in Japan, China, Asia and NA High-performance IV bag (film) High value-added films for medical use that add a touch to materials and products 102 nd Term 103 rd Term 102 nd Term 103 rd Term (FY2016) (FY2017) (FY2016) (FY2017) Net sales 67.1 bln JPY (+3.0% YoY) Operating income 1.3 bln JPY (+21.5% YoY) In our Chemicals Business, alongside working towards expanding upon our main product offerings, we are intensifying the global development of our business and are pushing forward with monozukuri (shop floor manufacturing) that adds a touch to materials and products. In the 103rd Term (FY2017), due to favorable sales by Japanese automobile manufacturers in China, to complement the increase in raw resin materials that we supply to existing automobile users, we worked towards growing new business. Our performance during the Term was solid as a result. Additionally, in the ASEAN region as well, sales of our raw resin materials grew due to robust unit sales of automobiles in Thailand. Moreover, in order to further evolve upon monozukuri, we decided to build a new plant for Shikoku Kakoh Co., Ltd., which manufactures and distributes high value-added, high-performance films for medical use, and will proceed to work towards employing new production methods and augmenting our production capacity. Promoting the development of safe, environmentally-conscious d Commenced the joint development of carbon fiber recycling We initiated joint development efforts for the recycling of carbon fibers used in aircraft. Until now, waste materials from aircraft had been difficult to recycle. With technology for extracting carbon fibers from those waste materials having been established, we decided on this joint investment and joint development endeavor in order to promote associated mass-production technology for future. By giving the practical application of carbon fiber recycling at an early stage a boost, in addition to promoting effective resource use, we expect that the resulting components will be inexpensive and highgrade, and will satisfy the need in recent years to make automobiles more lightweight. Developed environmentally-friendly water-soluble coating through monozukuri As a chemical-smart trading company, we go beyond simply distributing chemical materials and products around the world to practicing monozukuri for developing and supplying high value-added products with a touch added to them. Recently, to accommodate the needs of customers in our supply chain, we developed water-soluble coating from the standpoint of environmental preservation, starting with the limitation of VOC (Volatile Organic Compound) emissions, as well as from the standpoint of coating work safety. We have commenced the use of that coating in North America and China, and will continue to promote the development of other safe and environmentally-conscious products going forward. Carbon fibers used in aircraft expected to be recycled into materials for automobile components Water-soluble coatings produced with both the environment and work safety in mind (image representation of coating) 4

6 Consolidated Financial Statements (Summary) Consolidated Balance Sheet (Unit: 00 million JPY) Item Fiscal 2017 (Ending March 31, 2018) Fiscal 2016 (Ending March 31, 2017) (Assets) Current assets Noncurrent assets Total assets 1,338 1,180 (Liabilities) Current liabilities Noncurrent liabilities Total liabilities (Net assets) Shareholders equity Valuation and translation adjustments Non-controlling interests Total net assets Total liabilities and net assets 1,338 1,180 * For amounts stated above, amounts under 100 million JPY have been rounded down. Consolidated Statement of Income Item Fiscal 2017 (Fiscal Period Beginning April 1, 2017and Ending March 31, 2018) (Unit: 00 million JPY) Fiscal 2016 (Fiscal Period Beginning April 1, 2016 and Ending March 31, 2017) Net sales 1,821 1,700 Cost of sales 1,576 1,492 Gross profit Selling, general and administrative expenses Operating income Non-operating income 6 5 Non-operating expenses 7 8 Ordinary income Extraordinary income 1 0 Extraordinary loss 2 26 Net income before taxes Income taxes Net income Net income attributable to non-controlling interests 0 1 Net income attributable to owners of parent * For amounts stated above, amounts under 100 million JPY have been rounded down. Comments on Consolidated Balance Sheet Total assets at the end of the 103 rd Term (FY2017) increased 15.7 billion JPY year on year to billion JPY. This was mainly due to an increase in cash and deposits and in accounts receivable-trade. Total liabilities rose 2.6 billion JPY year on year to 67.1 billion JPY. This was mainly due to an increase in accounts payable-trade. Total net assets came to 66.6 billion JPY, up 13.1 billion JPY year on year. This was mainly due to an increase in retained earnings, an increase in capital surplus following a disposal of treasury shares conducted in connection with the listing of the company s shares, and other factors. 5 Consolidated Statement of Cash Flows Item Fiscal 2017 (Fiscal Period Beginning April 1, 2017 and Ending March 31, 2018) (Unit: 00 million JPY) Fiscal 2016 (Fiscal Period Beginning April 1, 2016 and Ending March 31, 2017) Cash flows from operating activities Cash flows from investing activities (88) (109) Cash flows from financing activities Effect of exchange rate changes on cash and cash equivalents 1 (1) Cash and cash equivalents at beginning of year Amount of increase in cash and cash equivalents following change in scope of consolidation - 3 Cash and cash equivalents at end of year *For amounts stated above, amounts under 100 million JPY have been rounded down.

7 Company Outline Company Outline (As of March 31, 2018) Trade Name : Moriroku Holdings Company, Ltd. Primary Business Activities: The control and management of the business activities below through share-based ownership of the companies conducting said activities Date of Founding : 1663 Resin-Treated Products Business Date of Establishment : March 1916 Development, manufacture and distribution of resin-molded components for 4-wheeled and 2-wheeled vehicles and highperformance components Capital : 1,640,100,000 JPY Chemicals Business Number of Employees : (Consolidated) 4,386 Manufacture, distribution, importing and exporting of chemical and synthetic resin products Members of the Board of Directors, Auditors and s (As of March 31, 2018) Moriroku Holdings Company, Ltd. Moriroku Technology Company, Ltd. Moriroku Chemicals Company, Ltd. President, CEO & Shigenobu Miwa Chairman of Directors Shigenobu Miwa President, CEO & Shigenobu Miwa Mikio Sunaga President, CEO & Mikio Sunaga Hiroyuki Miyagoshi Advisor Shigeru Mori Outside Director Outside Director Mariko Mori Shunji Shitasako Manabu Fujise Koichiro Shibata Director Masaru Hayakawa Hiroshi Negishi Hideo Tsukai Shigeru Mori Director Director Takashi Kurita Hidehito Monji Shigeru Mori Mariko Mori Corporate Auditor (Full-Time) Corporate Auditor (Full-Time) Outside Corporate Auditor Outside Corporate Auditor Ryuichi Akatani Koichi Tada Tadashi Kawashima Mitsumaru Kajiya Corporate Auditor Executive Managing Officer Ryuichi Akatani Masayuki Kaneko Hiroaki Ono Kazuhiro Hashimoto Akira Yamazaki Corporate Auditor Ryuichi Akatani Taiji Kinowaki Yoshihiko Watanabe Kazuyuki Morita Koichi Tanaka Yusuke Ikuma Yasushi Furusawa 6

8 Memo to Shareholders Fiscal Year Beginning every April 1 and ending March 31 the following year Record Date Voting rights of Annual General Meeting of Shareholders March 31 Fiscal year-end dividends March 31 Interim dividends (when distributed) September 30 Official notice shall be issued in advance for any other necessary items. Annual General Meeting of Shareholders June Method of Official Notification Electronic notification will be conducted via postings on the Moriroku Group s official website ( Please note that should an accident or other unavoidable circumstances prevent the conducting of notification through electronic means, the Moriroku Group will issue official notification through the Nihon Keizai Shimbun (Nikkei) newspaper. Minimum Share Trading Unit 100 shares Shareholder Registry Administrator The Sumitomo Mitsui Trust Bank, Limited Marunouchi, Chiyoda-ku, Tokyo, Japan Other Points of Contact The Sumitomo Mitsui Trust Bank, Limited All branches nationwide Inquiries Administrative Procedures Point of Contact for Mailing of Items or Confirmation by Phone Moriroku Holdings Company, Ltd. Stock Office Supervisor, Administrative Div. Shin-Aoyama Bldg. East Annex, 18 th Floor, Minami-Aoyama, Minato-ku, Tokyo, Japan TEL: (switchboard) FAX: kabushiki@moriroku.co.jp The Sumitomo Mitsui Trust Bank, Limited Securities Agent Department Izumi, Suginami-ku, Tokyo, Japan TEL: (Monday through Friday 9:00 AM-5:00 PM) Moriroku Group Websites Information regarding the Moriroku Group can also be found on the following websites. Moriroku Holdings Company, Ltd. Moriroku Technology Company, Ltd. Moriroku Chemicals Company, Ltd