Showa Denko Targets to Double Operating Profit in 2013

Showa Denko announced on Wednesday the firm targets 80 billion yen of operating profit with 1 trillion yen of sales in 2013 under the new 5-year plan, PEGASUS starting in 2011 compared with estimated 400 billion yen of operating profit with 825 billion yen of sales in 2010. The firm tries to expand graphite electrode business for future growth. The firm tries to realize 7% of return on assets to increase the annual dividend as early as possible from 3 yen per share to 5 yen.

The firm plans 220 billion yen of capital expenditure in 3 years. The firm tries to expand hard disc and graphite electrode business under the new plan to follow growing Asian market. The firm also tries to expand offshore business for alloy for rare earth magnet, high purity foil for capacitor and cylinder for printer.

The firm launched 3-year plan through 2008. However, the firm extended the plan for additional 2 years to restructure the business structure under financial crisis. The president Kyohei Takahashi said the restructuring completed around 60% and the remaining actions depend on managing corporate officer and next president Hideo Ichikawa.

The firm withdraws from aluminium ingot, alloy and commodity grade extrusion products to improve the profitability. The firm sold automobile heat exchanger business to Keihin Corporation as part of the restructuring. The firm focuses on high valued aluminium products including high purity aluminium foil, cylinder for laser printer and beverage can.