Sanyo Special Steel Targets 30% Export Rate in F2013

Sanyo Special Steel announced on Thursday the firm targets 30% of export rate for annual sales volume in fiscal 2013 ending March 2014 compared with current 15% under the new 3-year plan. The firm targets 15 billion yen of recurring profit with 200 billion yen of annual sales for fiscal 2013 compared with estimated 12.9 billion yen profit with 157.4 billion yen sales for fiscal 2010. The firm plans 30 billion yen of capital expenditure for the 3 years to fiscal 2013 compared with near 60 billion yen of expenditure for 3 years through fiscal 2010. The firm tries to improve the cost competitiveness to follow growing demand in Asia.

The capital expenditure is to improve the productivity including lower cost, clear bottleneck and automation. The firm tries to secure marginal additional production capacity to follow growing demand in offshore market while the firm establishes Delhi office in India in May and expands Shanghai office operation to local company scale.

The firm increases the sales volume to monthly 100,000 tonnes in fiscal 2013, which is 11% higher than current level. The firm targets 15.5 billion yen of operating profit in fiscal 2013 compared with estimated 13.5 billion yen in fiscal 2010 while the firm expects the return on sales decreases by 0.7 percentage points to 7.5% under more severe competition with Asian rivals.

The president Nobuyoshi Fujiwara said at the press conference in Tokyo on Thursday world special steel demand will increase but the firm has to improve the nonprice competitiveness for high valued products to follow the demand. He emphasized the firm tires to keep improving advanced technology for technology advantage over the rivals. He noted the firm targets doubling the sales for heat resistance steel, corrosion resistance steel and wear resistance steel during the 3 years while the firm tries to increase the sales of steel and fabricated steel products by 25%.