Sankyo-Tateyama to Reduce Cost through Plants Reshuffle

Sankyo-Tateyama Holdings’ chairman Hitoshi Kawamura said on Friday at the press conference for results of mid-year to November the firm tries to agree with Shin Nikkei by around May 2009 to consolidate the production facilities. They consider potential shutdown for some plants to reduce the cost by total 10 billion yen per year.

Sankyo-Tateyama also seeks the own cost reduction through job cut in the first half year and additional actions in the second half. The firm also idles casting operation by March 2009 at the group company, Sankyo Material’s Takaoka plant in Toyama.

Sankyo-Tateyama posted loss for the fist half year due to slump for the materials of building construction. The building construction materials unit posted 2.24 billion yen of operating loss while the housing materials unit posted 366 million yen of loss due to slower demand.

The firm reduced 186 jobs to consolidated 10,195 of employees at end of November compared with end of May 2009. The firm tries to seek lower cost operations through consolidation of production sites.

The firm expects 900 million yen of recurring profit for the full year. The firm tries to secure the profitability in operating and recurring profit while the firm expects net loss.