Showa Electric Wire & Cable to Double Operating Profit by F2007

Showa Electric Wire & Cable announced on Tuesday it revised the current 3-year plan to fiscal 2006 ending March 2007 and launched new 3-year plan to fiscal 2007. The firm tries to improve the profitability by resetting the strategy for the core growing units including wiring harness for electronics equipments and roller for photo copier while it reduces cost by scrapping and building group companies for wire and cable unit. The firm targets 5.5 billion yen of consolidated operating profit and 4.2 billion yen of recurring profit with 146 billion yen of sales along with 2.8% of recurring profit on assets for fiscal 2007. The device unit, which has products line of precise devises including roller, vibratory control equipment, wiring harness and optical devices, targets 1.4 billion yen of operating profit with 25.4 billion yen of sales in fiscal 2007 compared with estimated 700 million yen of profit and 20 billion yen of sales in fiscal 2005. The firm accelerates the reduction of interest bearing debt ahead of the original schedule. The firm reduces the debt to less than 62 billion yen at the end of fiscal 2007 from 67 billion yen at the end of fiscal 2005. The firm also expends 3 billion yen per year for the 3 years. The firm increases the share of offshore investment to produce wiring harness and roller. The firm increases research and development expenses to 1.6 billion yen for fiscal 2006 and 1.8 billion yen for fiscal 2007 from 1.3 billion yen in fiscal 2005. The firm expects to post 2.8 billion yen of consolidated operating profit and 1.2 billion yen of recurring profit with 135 billion yen of sales for fiscal 2005. The recurring profit on assets is 0.8%.