FEIC Tries to Expand Sales of Non-Construction Copper Cables in F2010

Furukawa Electric’s 100% subsidiary to manufacture industrial wires and cables, Furukawa Electric Industrial Cable (FEIC) aims to increase the sales of non-construction wires and cables by 20% in fiscal 2010 (April 2010-March 2011) compared with fiscal 2009. FEIC’s copper wire and cable shipment is estimated to total 26,000 tonnes per year in copper weight in fiscal 2009, decreasing by 21% from fiscal 2008. The firm forecasts the annual shipment volume would become almost same or slight less in fiscal 2010 compared with fiscal 2009. The construction cable shipment is likely to show a year-on-year decrease, which accounts for 60-70% in the total volume. FEIC plans to increase the sales of other cable items such for wind power generation or train cars.

FEIC estimates the annual net sales at approximately 27 billion yen with the annual operating loss for fiscal 2009. The firm recovered the operating profit for October-December 2009 but cannot cover the large loss in the first 6 months, especially in April-June 2009 when copper cable shipment significantly declined.

FEIC’s current cable shipment is 2,200-2,300 tonnes of copper per month.Mr. Kiyoshi Nakayama, FEIC’s president said the plants’ operating rate is 50-60% for construction cables and around 80% for marine cables and train-car cables compared with the first half of fiscal 2008. Hokuriku plant in Ishikawa Prefecture, Japan and Tochigi plant in Tochigi Prefecture, Japan continue to set 2-day layoffs per month, both of which are devoted to production of construction wires and cables.

FEIC forecasts the construction cable shipment would decrease more in fiscal 2010 since Japanese construction market maintains stagnant. The firm tries to increase the sales of other items such as wind power generation cables, train-car cables and marine cables in both short and medium terms. The firm also targets to gain the annual operating profit in fiscal 2010.