Maruichi Steel Tube to Expand Offshore Business

Maruichi Steel Tube expands the offshore business through aggressive investment in fiscal 2011. The subsidiary, Sun Steel Joint Stock Company (SUNSCO) of Vietnam decided US$ 90 million of investment to complete No.2 continuous galvanizing line and No.2 color coating line in April 2012. Maruichi Steel Tube builds Indian No.2 plant in Chennai to expand stainless pipe making capacity for automotive exhaust pipe. The US subsidiary, Leavitt Tube Company (LTC) plans conversion of 10 inches square pipe making line and small sized mechanical tube making line.

With the new line, SUNSCO expands the galvanizing capacity from monthly 10,000 tonnes to 30,000 tonnes. The firm tries to get certification to make American Petroleum Institute grade pipe at the 16 inches mill, which was completed in May 2010. LTC starts operation of 5 inches mill in December after the renewal. The firm converts 10 inches square pipe making line to make round pipe by October 2012.

The firm posted 10.211 billion yen of consolidated net profit for fiscal 2010 ended March 2011, which was higher than 7.363 billion yen of profit in fiscal 2009 and reached 10 billion yen for the first time in 3 years. The operating profit rate increased by 4 percentage points to 14.3% when the operating profit increased to 16.505 billion yen from 10.556 billion yen. The firm targets 17.7 billion yen of operating profit and 11.5 billion yen of net profit for fiscal 2011.

The firm posted 359 million yen of onetime loss on the major earthquake damage on Tokyo No.2 plant in Chiba and the trading division’s office in Miyagi for fiscal 2010. The firm tries to improve the disaster control at the domestic plants including support between domestic plants and support by offshore plants.