Ohki Brass & Copper Enjoys 7 Times Y/Y Profit Increase in 2010

Japanese major brass bar maker, Ohki Brass & Copper enjoyed approximately 7 times year-to-year growth of annual operating profit in 2010. The non-consolidated operating profit totaled 1.37 billion yen including property business, which exceeded recently highest 1 billion yen in a fiscal year ended in May 2006. The sales volume increase and copper price upsurge pushed up the profit. The copper alloy product business returned to annual black after posting annual loss for 2 years in a row. For 2011, the firm forecasts annual operating profit at 750 million yen when the inventory evaluating profit is estimated to decrease.

The annual net sales doubled to 20.028 billion yen in 2010 from approximately 10 billion yen in 2009. The recurring profit was 1.366 billion yen. The firm’s annual production increased by 43% to 33,000 tonnes including phosphor bronze from 2009. The output volume recovered to the level as high as 32,000 tonnes in a fiscal year ended in May 2008 (the firm changed fiscal year term from June-May to January-December in 2008).

The demand for copper alloy products was weak for January-March 2010 while the demand upturned in and after April mainly from automotive component industry. The brass bar sales were also steady for water taps and gas appliances related to home renovation. Ohki’s production volume had increased toward September.

In and after September, the firm could keep output level at around 2,700 tonnes per month despite of the end of governmental subsidy program for eco friendly cars. Meanwhile, the electrolytic copper market price, which is the indicator for copper alloy product prices, maintained strong uptrend in and after mid 2010. Thus the firm gained inventory evaluating profit.

For 2011, Ohki plans annual production at 33,000 tonnes and annual net sales at 20 billion yen.