TOP  >  IR Information  >  Management Information  >  Top Message
IR Information

Management Information

Top Message

Status of Fiscal Year Ended March 2019 (FY2018)

The global economy during the Fiscal Year Ended March 31, 2019 (FY2018) saw steady economic growth on increased consumer spending driven by a positive employment environment in the U.S.A. The European economy also trended towards recovery. On the other hand, while the Chinese economy maintained overall stable growth, intensified trade friction between the US and China drove a trend towards deceleration. The Japanese economy continued a mild recovery trend, but the impact of the Chinese economy caused stagnant exports since the latter part of the first half as the trend towards economic deceleration strengthened.

The market environment impacting the Nippon Chemi-Con Group was firm despite signs of sluggish market conditions in certain areas such as stagnant demand for industrial robot and other equipment-related markets in China. In addition to overall favorable conditions in the gaming market, automobile-related markets saw mostly firm growth thanks to advances in the adoption of Advanced Driving Assistant Systems (ADAS).

Amid such an operating environment, our Group continued to implement the various policies outlined in our 8th Medium-term Management Plan towards increasing our corporate value. Looking at sales, we worked to expand sales by clarifying core markets and products for sales expansion in each region and engaging in flexible sales development activities to rapidly respond to customer needs. We also worked to expand overseas production sites and promote production in optimal locations to reduce logistics expenses and other sales management costs to improve profitability. At the same time, we engaged in a unified Group effort under our mother factory structure to increase productivity by strengthening initiatives related to improving facility operating rates at overseas production sites.

In the area of product development, we developed and started mass production for the new LBV Series, a product line of radial lead type aluminum electrolytic capacitors for vehicle airbags. This new series offers up to approximately 30% higher capacitance compared to previous products. And for the MZR Series, the surface mount type aluminum electrolytic capacitor gaining market share for use in car navigation systems and in the emergency power supplies installed on various meters, we enhanced the product line by developing new products that last longer than previous products.

As a result, consolidated earnings for the Fiscal Year Ended March 2019 (FY2018) were net sales of 140,951 million yen (up 5.7% YoY), operating income of 5,137 million yen (down 11.7% YoY), and ordinary income of 4,833 million yen (up 9.5% YoY). Furthermore, we recorded profit attributable to owners of parent of 917 million yen (previous fiscal year was losses attributable to owners of parent of 16,056 million yen) on having recorded extraordinary losses related to the Antitrust laws.
Furthermore, we have set a year-end dividend for FY2018 of 30 yen per share.

Status by Division

Status by business division for FY2018 is as follows.

  1. Capacitors (126,391 million yen, 89.7% of total sales)
    Despite signs of sluggish market conditions in certain areas such as stagnant demand in equipment-related markets in China, overall automotive-related demand was favorable as division net sales increased 4.8% YoY.
  2. Mechanical Parts and Other Parts (3,537 million yen, 2.5% of total sales)
    Division net sales increased 10.2% YoY thanks to increased CMOS camera module sales.
  3. Capacitor Materials (6,819 million yen, 4.8% of total sales)
    Division net sales decreased 4.3% YoY on stagnant demand for electrode foils for aluminum electrolytic capacitors in Japan and China.
  4. Other Products (4,202 million yen, 3.0% of total sales)
    Division net sales increased 72.8% YoY thanks to increased sales of resale products.

Forecasts for Fiscal Year Ending March 2020 (FY2019)

Looking at earnings forecasts, the US economy is expected to continue a trend of stable growth and Europe is expected to maintain an overall trend of mild recovery. On the other hand, the operating environment impacting our Group continues to require caution due to economic slowdown in China and the effect prolonged trade friction between the US and China is having on the global economy.

For FY2019, the final year of our 8th Medium-term Management Plan, the Nippon Chemi-Con Group has outlined our fundamental strategy as "Restoring the public confidence and improving corporate value toward the 90th anniversary (promoting aggressive management from shareholders' perspective) and Creating a platform for growing into a company with annual sales of 200 billion yen in the 9th Medium-term management plan." We will continue implementing core measures aimed at achieving the goals of our Medium-term Management Plan. We will engage in aggressive sales expansion activities in the automotive electronics market, the communications market, and the power electronics market, which are expected to see continued demand growth. At the same time, we will focus sales expansion activities in overseas markets on products such as electric double layer capacitors, CMOS camera modules, multilayer ceramic capacitors, and amorphous choke coils to generate new demand. As part of our smart factory initiative, we will achieve dramatic improvements in operating rates and aim for further improvements in productivity by using IoT to acquire data on operating conditions, etc. from production facilities to create visualizations of production processes.

Our full-year consolidated earnings forecast for the year ending March 2020 (FY2019) is net sales of 138,000 million yen (down 2.1% YoY), operating income of 5,300 million yen (up 3.2% YoY), ordinary income of 5,000 million yen (up 3.4% YoY), and profit attributable to owners of parent of 3,500 million yen (up 281.4% YoY). Furthermore, our currency rate assumption is 110 yen/1 USD.

June 2019
Ikuo Uchiyama, Chairman
Norio Kamiyama, President