Sato Shoji Targets 5 Billion yen Recurring Profit in 3-5 Years

Japanese major steel trading firm, Sato Shoji targets 5 billion yen of consolidated recurring profit under new midterm management plan from fiscal 2012 starting April 2012. The firm targets 3 billion yen of net profit with 200 billion yen of sales. The president Kazuo Murata said the firm will improve profitability of domestic business and make aggressive investment for overseas business especially in Asia. The firm increases the offshore sales rate from current 10% to 30% through wider operations including Asian new processing base and sales force in India.

The firm tries to clear the same target under the new plan as former plan before Lehman Shock. With better results in fiscal 2010, the firm makes the new plan in the first half of fiscal 2011.

Under the midterm plan, Sato Shoji rebuilds domestic business base by checking existing transaction and by rebuilding closer relationship with the customers. The firm already expands the domestic business by acquiring plastic and glass material sales company. The firm tries to develop new business in every unit.

Sato Shoji firm starts operation of Thai die-holder making company for forging and Chinese reducer maker in July. The firm eyes processing site in Indonesia in cooperation with structural steel users of forging maker and car parts maker. In India, the firm launches study for potential local sales company based on existing export business of hot rolled coil for steel pipe with expectation for growing construction machinery demand.

Sato Shoji plans 300 million yen of investment for fiscal 2011 as fiscal 2010. The firm increases the investment to 1 billion yen level in and fiscal 2012. Mr. Murata emphasized the firm tries to get better trust from the customers through a series of the effort under the plan. With the closer relationship with the customers, the firm expands the business at home and abroad through M&A and alliance with partners.