Nippon Denko to Double Capital Expenditure in 2012

Nippon Denko plans to double capital expenditure to 7 billion yen in 2012 from 2011. The firm conducts strategic investment mainly for No.3 large sale lithium manganese oxide plant. The expenditure could be larger than the plan when the firm could invest in new offshore ferroalloy plant. The firm tries to realize strategic investment in each core business when the firm seeks growth mainly in 2 core businesses of ferroalloys and advanced materials under the 3 years plan through 2013.

The firm expanded the lithium manganese oxide plant last year to serve electric vehicle. However, the demand slows down recently and the firm postponed the decision of the additional expansion while the firm expected the decision last year. The firm is willing to start construction in the year depending on the users’ position in order to add more capacity than current 6,700 tonnes of annual output capacity.

The firm plans around 1.5 billion yen of normal maintenance and renewal expenditure in 2012. The firm excludes the potential offshore ferroalloy plant for the 7 billion yen of budget. With the offshore plant, the expenditure could increase more.

The firm expended around 3.5 billion yen in 2011 compared with planned 6 billion yen. The expenditure was mainly for maintenance when the decision was delayed for lithium manganese oxide expansion.