JFE Holdings’ steel unit, JFE Steel announced on Thursday the firm uses 730 billion yen for the group’s capital expenditure and financing in payment base under the new 3-year plan to fiscal 2008 ending March 2009. The value is 1.6 times of that for current 3-year plan to fiscal 2005. The firm increases the high-valued steel products output by 3 million tonnes to 23 million tonnes in fiscal 2008, which represents more than 80% of total sales, compared with estimated for fiscal 2005 by expanding output capacity for automotive steel sheet and energy tube including 13% chrome seamless tube. The firm also increases the research and development budget by 4 billion yen to 26 billion yen for fiscal 2008 from fiscal 2005. The firm tries to improve the productivity by reducing around 900 of employees, which represents 6%, in the 3 years though the firm hires seniors longer than before while the firm increases the R & D staff by 15%. Mr. Hajime Bada, president of JFE Steel said steel demand will keep firm mainly for high-valued steel for the 3 years. The firm tries to keep 500 billion yen of consolidated recurring profit and 18% of profit to 2.85 trillion yen of sales for fiscal 2008. The profit is flat and the sales are 5.5% higher than estimate for fiscal 2005. The firm tries to improve the profitability enough to post the record level in fiscal 2005 stably. The firm expects the raw steel output increases to 30 million tonnes in fiscal 2008 from 26.73 million tonnes for fiscal 2005, the export is flat at 40% for total sales and the foreign exchange rate of yen is 100 yen per a US dollar in fiscal 2008 from 113 yen in fiscal 2005. The firm also reduces interest bearing debt from 1.2 trillion yen at the end of fiscal 2005 to around 800 billion yen in 3 years. The firm expects the total net profit is 780 billion yen for the 3 years. With total 1.32 billion yen of cash including 540 billion yen of depreciation, the firm uses 730 billion yen for capital expenditure and financing, 190 billion yen for distribution of dividend for JFE Holdings and 400 billion yen for repayment of debt. The firm uses 570 billion yen for capital expenditure and 160 billion yen for investment and financing for the 3 years compared with 410 billion yen and 50 billion yen respectively in current 3-year plan. The firm allocates 50% of the 570 billion yen for expansion of high-valued output capacity and rationalization and 50% for maintenance. The firm uses 20% of 160 billion yen for raw materials and 80% for other strategic investment.
Japan Steel Scrap Composite Prices (Sangyo Press)04/08/2020
|19500YEN (-)||21700YEN (-)|
|177.81US$ (0.7)||197.87US$ (0.78)|
* Average of electric furnaces steel maker's purchasing price in Tokyo, Osaka and Nagoya (per ton)