Sankyo-Tateyama Lowers Mid-term Financial Targets for Jun 2011-May 2012

Sankyo-Tateyama Holdings announced on Wednesday the firm lowered the mid-term financial targets for a fiscal year ending in May 2012 considering slow new construction starts in Japan and currently high primary aluminium price, though the firm returned to the black in the latest fiscal year ended in May 2010. The firm revised down its net sales target for June 2011-May 2012 to 264 billion yen from previous 277 billion yen. Recurring profit target was lowered to 6.2 billion yen from previous 6.8 billion yen. Sankyo-Tateyama launched the latest mid-term management plan in 2009.

The net sales for June 2009-May 2010 decreased by 7.3% to 257.4 billion yen compared with the previous fiscal year due to domestic market shrinkage and severe sales competition. Meanwhile, the firm could recover the black for all business units by business restructuring. The firm posted operating profit at 4.8 billion yen for June 2009-May 2010 (operating loss at 7.6 billion yen in the previous fiscal year), recurring profit at 3.4 billion yen (recurring loss at 9.3 billion yen) and net profit at 2 billion yen (net loss at 19.2 billion yen).

In a fiscal year of June 2009-May 2010, the group realized profit recovery of total 17.6 billion yen by payroll cost reduction, plant reorganization, cost downsizing for operation and procurement. The firm continues cost down effort for additional 5.6 billion yen in June 2010-May 2011. At the same time, the firm tries to raise sales rate of renovation business to 30% and the rate of non-architectural material business to 36%. The firm also enhances overseas businesses.

Among non-architectural materials, the firm advances development of environmental and energy saving products related to LED or solar cell. At overseas, the firm eyes Asian market growth, especially utilizing an existent affiliate in Shanghai, China.