NISSIN KOGYO CO., LTD.
Annual Review 2014
13 14 10 11 12
0 60,000 120,000 180,000 240,000
0 6,000 12,000 18,000 24,000
13 14 10 11 12 0
5,000 10,000 15,000
13 14 10 11 12
0 100,000
50,000 150,000 200,000
Financial Highlights
Nissin Kogyo Co., Ltd. and Consolidated SubsidiariesYears ended March 31, 2013 and 2014
Contents
00
Financial Highlights01
Message from the President02
New Adoptions of Our Products04
Corporate Governance05
Environmental Policies06
Financial Review08
Consolidated Balance Sheets (Unaudited) Consolidated Statements ofChanges in Net Assets (Unaudited)
10
Consolidated Statements of Income (Unaudited) Consolidated Statements ofComprehensive Income (Unaudited)
11
Consolidated Statements ofCash Flows (Unaudited)
12
Network13
Corporate DataNet Sales/Operating Income
(¥ millions)
Total Assets/Net Assets
(¥ millions)
Net Income
(¥ millions)
Total Assets Net Assets Net Sales (left scale)
Operating Income (right scale)
Millions of yen
Thousands of U.S. dollars
2013 2014 2014
For the year:
Net sales ¥174,252 ¥220,868 $2,146,016
Operating income 8,762 19,417 188,661
Income before income taxes and minority interests 10,205 21,845 212,252
Net income 4,924 12,200 118,539
At year-end:
Total assets ¥152,381 ¥177,540 $1,725,029
Net assets 110,991 129,591 1,259,143
Per share (yen and U.S. dollars):
Net income—primary ¥ 76.03 ¥ 188.14 $ 1,828.02
Cash dividends paid 36.00 40.00 388.65
Message from the President
Thank you to all of our shareholders for your continuing encouragement and support.The Nissin Kogyo Group is working to enhance our underlying competitiveness and establish a foundation for future growth by developing and providing products that are smaller, lighter and create cutting-edge value, and that offer environmental friendliness and safety.
Business Results for the Year
Our business results in the fiscal year under review were as follows. In Japan, revenues increased compared to the previous fiscal year as improved consumer sentiment spurred a recovery in demand and new products were successfully launched for automobiles. Profits were affected by an increase in R&D expenditures, but rose overall year on year thanks to the increase in revenues, the effects of cost reductions and lower product warranty related expenses, among other factors. In North America, sales increased year on year owing in part to a brisk market for automobiles against the backdrop of a stronger economy as well as to the impact of currency rates. Profits however declined year on year despite the increased revenue and favorable currency rates due to higher costs and other factors. In Asia, revenues and profits rose thanks to solid demand growth in Indonesia for motorcycles, a recovery in sales and the effects of new models launched in China, a positive rebound from the flood-induced slump in Thailand, and currency rates, among other fac-tors. In South America and Europe, revenues and profits rose year on year due to the impact of currency rates and other factors, and despite a decline in sales of motorcycle products resulting from stagnation in the European motorcycle market.
As a result, in the fiscal year ended March 31, 2014 we achieved significant increases in revenues and profits. Net sales increased 26.8% to ¥220,868 million and operating income soared 121.6% to ¥19,417 million. Nissin Kogyo paid a full-year dividend of ¥40 per share, a year-on-year increase of ¥4.
Forecasts for the Fiscal Year Ending March 31, 2015 Economic Conditions in Each Area
As regards the outlook for the economy in the coming fiscal year, with the impact of fiscal restraint diminishing, the U.S. economy is expected to enjoy a gradual recovery against a backdrop of firm business confidence in the corporate sector and growth in consumer spending. In Europe, unpinned by the healthy German economy, real GDP is expected to return to positive growth for the first time in three years. In China, the economy is projected to gradually decelerate as investment growth slows, despite such positive factors as an export recovery and strong consumer spending. There is concern however that the financial environ-ment could deteriorate substantially as the shadow banking problem is exposed, which poses a downside risk to the economy. In the ASEAN region, real GDP growth is expected to slow in both Thailand and Indone-sia, due to slowing in large-scale infrastructure investment caused by political turmoil and deterioration in consumer sentiment depressing domestic demand in the former, and deceleration in domestic demand due to fiscal tightening in connection with currency depreciation and inflation in the latter. The Japanese economy, however, is expected to return to a growth trajectory starting in the July-September quarter, despite being unable to avoid negative growth in the April-June quarter due to a negative rebound from last-minute demand prior to the con-sumption tax hike. The economy should recover thanks to an increase in public investment and effective underpinning of domestic demand through lower corporate tax rates and household assistance measures— all part of the government’s economic policy—and to an increase in exports associated with yen depreciation and better economic conditions overseas.
Automobile Markets
Automobile sales in the U.S. are expected to continue to be firm as the economy gradually improves, but replacement demand is also likely to slacken, so sales are projected to only increase slightly year on year. In the European market, economic conditions have bottomed out and there are growing signs of recovery, so automobile sales are expected to recover at a moderate pace. In China, while solid market growth is expected to continue, growth will slow year on year, and there are con-cerns about the impact of deceleration in the pace of economic expan-sion and restrictions on the purchase of new cars in large cities. Sales of Japanese brand vehicles may be impacted if anti-Japanese sentiment again gathers momentum and it will be necessary to continue paying close attention to market trends. In the ASEAN region, there is a growing sense that the economy is slowing, and in Thailand long-standing political instability and other factors are expected to depress consumer spending and send automobile sales down on a year-on-year basis. In Indonesia, there is a great deal of latent growth potential as the incomes of the purchasing class rise, so motorcycle sales are expected to remain strong.
Nissin Kogyo’s Measures for the Next Fiscal Year
In this operating environment, the Nissin Kogyo Group has formulated its twelfth medium-term management plan, which begins in the fiscal year ending March 31, 2015, and has crafted basic policies for its braking system business for motorcycles—“Establish a rock-solid foundation as a top manufacturer”—and its braking system business for automobiles— “Strengthen proposal and sales capabilities as a general systems manu-facturer.” On the basis of these policies we will work to expand the scope of local procurement and manufacturing, pivoting on growth markets, and develop and deliver products that are smaller, lighter and create cutting-edge value, underpinned by environmental performance and safety considerations.
Business Prospects for the Fiscal Year Ending March 31, 2015 For the fiscal year ending March 31, 2015 Nissin Kogyo is projecting net sales of ¥233.0 billion, operating income of ¥20.0
billion, ordinary income of ¥21.0 billion and net income of ¥11.3 billion.
Regarding the currency exchange rates used for performance forecasts, we have assumed a rate of ¥102 to US$1. However, there is an increasing sense of uncertainty in the economic outlook given trends in financial markets and the real economy in Japan, where major financial easing continues, and the economic situations in other countries.
We plan to pay a dividend of ¥40 per share.
I would like to thank our sharehold-ers for your continuing support.
August 2014
Honda’s hybrid car Vezel, which has started being sold in Japan, employs our regenerative cooperation brake and other Nissin Kogyo brake products and aluminum products.
Our regenerative cooperation brake efficiently stores brake-induced deceleration energy in a battery, thereby usefully improving the car’s fuel economy. In addition to normal deceleration, the energy is obtained from when the brake is first applied up until the car comes to a stop.
The Nissin Kogyo Group constantly strives to keep one step ahead of changes in the world by conducting research and development activities in order to create new product fami-lies that can contribute to safety and environmental performance, while meeting the needs of customers and society.
In Japan, Group efforts are cen-tered on basic brake and mechatron-ics automated control systems and aluminum products, primarily for
motorcycles and automobiles. In these areas, we aim to reduce weight, improve fuel efficiency, and develop products contributing to better safety and comfort, as well as develop mate-rials and manufacturing processes, all from a global perspective. We are also responding to needs related to achieving a low- carbon society by developing products, materials and manufacturing processes that can contribute to the reduction of CO2 emissions.
Research and
Development Activities
Automobile Business
The regenerative cooperation brake
Pickup
The Vezel hybrid
New Adoptions of Our Products
Through its aluminum weight reduction and braking systemThe UK company Triumph’s Thunderbird motorcycle has adopted our light and small Anti-lock Brake System (“ABS”) developed for motorcycles, and other Nissin Kogyo brake products.
R&D Expenditures/ Ratio to Net Sales
(¥ millions/%)
R&D Expenditures (left scale) Ratio to Net Sales (right scale) We are enhancing the research
and development platform in order to advance these activities more quickly. Specifically, as a form of computer-ized assessment, we are working on development initiatives utilizing CAE analysis (strength, action confirma-tion, casting defects, brake screech-ing, etc.) and simulation technology (ABS using HILS, ESC program diagnostics).
In North America, we are develop-ing basic brake systems, mechatron-ics automated control systems and
aluminum products tailored to the needs of regional customers and society. In tandem, we are conduct-ing market surveys to identify needs and trends in this region.
Nissin Kogyo’s Development Divi-sion is the key driver of the Group’s research and development. R&D expenditures in the year under review were ¥8,041 million; by geographic segment, Japan accounted for ¥7,514 million and North America for ¥526 million, respectively, of the total.
Motorcycle Business
14 10 11 12 13
0 2,000 4,000 6,000 8,000
0 2.0 4.0 6.0 8.0
Thunderbird
Anti-lock Brake System
Plunger-type brake master cylinder
The Corporate Governance Structure
(As of June 16, 2014) Board of Directors
Compliance Committee Corporate Ethics Improvement Proposal Office Board of Auditors
Management Committee
Business Management Division
Production and Purchasing Division
Development Division
Quality Assurance Oversight Quality Assurance Department
Development and Marketing Oversight
Marketing Division
Internal Auditing Office
Local Bases
Overview of Nissin Kogyo’s Organization and Development of Internal Control Systems
Nissin Kogyo’s Board of Directors comprises 10 Directors, and its role is to deliberate upon legal matters and major
man-agement issues. The Manman-agement Committee comprises 10 Directors and its role is to sufficiently deliberate upon
impor-tant matters of management, share management issues and decide upon measures to solve those issues. The
Management Committee also conducts prior deliberation of matters to be put forward to the Board of Directors.
Nissin Kogyo has a Board of Auditors in accordance with the Companies Act. The Board of Auditors comprises four
Auditors, two of which are Outside Auditors. Auditors attend meetings of the Board of Directors and the Management
Committee, and it is their job to audit the status of management’s execution of duties.
The Internal Auditing Office appoints five full-time auditors and concurrent auditors elected from the accounting field to
form an Independent Operation Auditing Department, and it is the job of this department to provide support in the
execu-tion of internal auditing and to respond to requests from Auditors. In internal auditing, the Internal Auditing Office executes
auditing of all domestic divisions on a twice-yearly basis, along with executing regular audits of overseas bases.
The system for execution of operations is modeled on a high standard of effectiveness and efficiency and utilizes the
cooperation of the four functional headquarters and overseas bases.
Basic Philosophy
The Nissin Kogyo Group executes its corporate governance based on policies and regulations concerning conduct, placing importance on its basic company philosophy of “warm-heartedness and contribution,” and its credo of “providing superior products, technologies and ideas to meet the needs of customers and society one step ahead of the changes in the world.”
Classification Total compensation paid (Millions of yen)
Total compensation paid by type (Millions of yen) Number of recipients (Persons) Basic compensation Bonus
Directors 297 239 58 11
Corporate auditors
(Excluding outside corporate auditors) 48 37 11 3
Outside director and corporate auditors 6 6 — 2
Details of Director and Auditor Remuneration
Environmental Policy of Nissin Kogyo
In June 1998, Nissin Kogyo formulated its Environmental Policy to promote environmental protection activities. Every
member of the Group is working together toward the formation of a recycling-oriented, sustainable society.
Environmental Protection Activities
Aiming to establish environmentally friendly plants that contribute to the reduction of CO2 emissions, Nissin Kogyo is promoting
the introduction of cogeneration facilities that use natural gas. This system generates electricity to be used by our plants from
natural gas. We also effectively utilize the hot water and heat produced by these systems.
The first of our factories to introduce a cogeneration facility was the Ueda Plant in July 2004. This was followed by the
introduc-tion of the same system at the Naoetsu Plant and the Tobu Plant.
In addition to using the electricity generated by these systems for plant operations, we also effectively utilize the hot water and
heat produced for the cooling and heating systems of our Corporate Headquarters and the Ueda Plant. At the Naoetsu Plant, the
electricity generated is used at the new plant for automobile parts, with the hot water and surplus heat utilized not only in alumite
treatment and surface treatment processes, but also to melt snow in the winter.
Environmental Initiatives
Nissin Kogyo treats environmental issues as among management’s most important challenges, and vigorously conducts envi-ronmental protection activities. Beyond providing customers with resource- and energy-saving products, the Nissin Kogyo Group concentrates wholeheartedly on the environment and safety, and is developing a framework for further environmental protection.
Cogeneration facility of the Tobu Plant
Environment-Friendly Products
Nissin Kogyo develops and manufactures a wide range of environ-ment-friendly products. For instance, we have successfully completed the following product development projects: 1) product modifications to improve fuel efficiency through weight reduction, 2) reduction of industrial waste through the use of recycled materials, 3) reduction of environmentally hazardous substances, 4) fuel efficiency improvement through new devices, and 5) reduction of energy used in manufacturing.
Aluminum Knuckle
14 10 11 12 13
0 50 100 150 200
0 50,000 150,000 250,000 200,000
100,000
14 10 11 12 13
0 3,000 6,000 9,000 12,000 15,000
0 5,000 10,000 15,000 20,000 25,000
14 10 11 12 13
Business Results
In the fiscal year ended March 31, 2014, consolidated net sales
increased 26.8% to ¥220,868 million. Operating income increased
121.6% to ¥19,417 million, while ordinary income increased 105.4% to
¥21,703 million. Net income increased 147.8% to ¥12,200 million.
Net income per share increased from ¥76.03 in the previous year to
¥188.14. Nissin Kogyo paid a year-end dividend of ¥20 (full-year
divi-dend of ¥40) per share as planned.
Breakdown by Geographic Segment
JapanIn Japan, the launch of new automobile products had a positive effect
on sales. Consequently, net sales increased by 16.0% year on year to
¥51,619 million.
Operating income increased by 143.6% year on year to ¥5,359
million. The main contributing factors were the benefits of higher
revenue from the launch of new automobile products, the effects of
cost reductions, lower product warranty-related costs and positive
foreign exchange effects. These factors were partly offset by higher
R&D expenditures.
North America
Net sales increased by 27.8% year on year to ¥57,184 million, due to a
strong automobile market, positive foreign currency translation effects
and other factors.
Operating income decreased by 7.1% year on year to ¥718 million.
This result primarily reflected higher costs, despite the benefits of
increased revenue and positive foreign exchange effects.
Asia
Net sales increased 35.7% year on year to ¥96,388 million. The main
contributing factors were steady growth in Indonesia, a recovery in
sales and the positive effects of the roll-out of new types of automobiles
in China, an increase in demand in Thailand following a downturn
caused by the impact of the floods, and positive foreign currency
translation effects.
Operating income was ¥12,454 million, up 90.0% from the previous
fiscal year. This result mainly reflected the benefits of higher revenue and
positive foreign exchange effects.
South America and Europe
Net sales increased by 11.9% year on year to ¥15,676 million, mainly
due to positive foreign exchange effects, despite a slump in Europe’s
motorcycle market.
Net Income per Share (Primary)
(¥)
Net Sales by Geographic Segment
(¥ millions)
Capital Expenditures/ Depreciation and Amortization
(¥ millions)
Japan North America Asia South America and Europe
0 20 60 100 80
40
14 10 11 12 13
0 5 15
10
14
10 11 12 13 10 11 12 13 14
–20,000 –10,000 0 10,000 20,000 30,000
As a result of positive foreign exchange effects and other factors, the
Group recorded operating income of ¥598 million in this segment, up
¥694 million from the operating loss recorded in the previous fiscal year.
Capital Expenditures
The Nissin Kogyo Group makes investments primarily to augment
pro-duction capacity, reform business structure, conduct R&D, and launch
new products in business segments from which longer-term growth is
anticipated. Capital expenditures in the year under review were ¥12,961
million. There were no disposals or sales, etc., of important facilities in
the year under review.
Financial Position
Current assets increased ¥15,093 million from the previous fiscal
year-end to ¥100,151 million, principally due to an increase in notes and
accounts receivable. Non-current assets increased ¥10,067 million from
the previous fiscal year-end to ¥77,389 million, reflecting increases in
property, plant and equipment, net and investment securities. As a
result, total assets at the fiscal year-end came to ¥177,540 million, up
¥25,159 million from the previous fiscal year-end.
Current liabilities rose ¥5,778 million from the previous fiscal
year-end to ¥39,997 million, primarily due to an increase in notes and
accounts payable. Long-term liabilities increased ¥781 million to ¥7,951
million. As a result, total liabilities were ¥47,948 million, an increase of
¥6,558 million from the previous fiscal year-end.
Net assets climbed ¥18,601 million from the previous fiscal
year-end to ¥129,591 million, principally due to increases in retained earnings
and foreign currency translation adjustments.
Cash Flow
Cash and cash equivalents (“cash”) as of March 31, 2014 stood at
¥30,251 million, up ¥3,920 million from the previous fiscal year-end,
reflecting an increase in cash from factors including income before
income taxes and minority interests, which was partly offset by a
decrease in cash from use for capital investment.
Net cash provided by operating activities was ¥22,401 million.
Principal items included income before income taxes and minority
inter-ests and depreciation and amortization.
Net cash used in investing activities was ¥16,940 million. Principal
items included capital investment.
Net cash used in financing activities was ¥2,225 million. This was
mainly due to dividends paid.
The Company will allocate internal reserves to capital needs for
product development essential for future growth and business
expansion.
Shareholders’ Equity Ratio
(%)
Return on Equity
(%)
Cash Flows
(¥ millions)
Millions of yen
Thousands of U.S. dollars
ASSETS 2013 2014 2014
Current assets:
Cash and bank deposits ¥ 26,943 ¥ 31,129 $ 302,458
Marketable securities 4,182 6,000 58,298
Notes and accounts receivable 26,072 32,322 314,050
Inventories 21,521 24,117 234,328
Deferred income taxes 2,489 1,996 19,394
Prepaid expenses and other current assets 3,855 4,601 44,705
Allowance for doubtful accounts (3) (15) (146)
Total current assets 85,058 100,151 973,096
Property, plant and equipment:
Land 6,769 6,423 62,408
Buildings and structures 22,601 24,790 240,867
Machinery and equipment 89,616 102,370 994,656
Vehicles and fixtures 19,616 23,115 224,592
Lease assets 1,080 237 2,303
Construction in progress 4,506 5,421 52,672
144,188 162,356 1,577,497
Accumulated depreciation (95,468) (105,735) (1,027,351)
Property, plant and equipment, net 48,721 56,620 550,136
Investments and other assets:
Investment securities 15,690 17,100 166,148
Deferred income taxes 186 231 2,244
Other assets 1,205 1,734 16,848
Allowance for doubtful accounts (0) (0) (0)
Total investments and other assets 17,081 19,066 185,251
Total assets ¥152,381 ¥177,540 $1,725,029
Note: U.S. dollar amounts have been translated from yen for convenience only, at the rate of ¥102.92=U.S.$1, the approximate Tokyo foreign exchange market rate as of March 31, 2014.
Millions of yen Shareholders’ equity Valuation and translation adjustments
Common stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’
equity
Net unrealized holding gain on investment securities
Deferred gains or losses on hedges
Foreign currency translation adjustments
Net accumulative adjustment to retirement benefits
Total valuation, translation adjustments and others
Minority interests
Total net assets Balance as of March 31, 2013 ¥3,694 ¥3,419 ¥88,645 ¥(880) ¥ 94,878 ¥7,173 ¥ — ¥(8,852) ¥ — ¥(1,679) ¥17,792 ¥110,991 Changes in the period:
Dividends (2,464) (2,464) (2,464)
Net income 12,200 12,200 12,200
Cancellation of treasury stock (0) (0) (0)
Increase (decrease) in treasury stock due to changes in equity among affiliates
accounted for by the equity method 31 94 126 126
Net changes of items other than
stockholders’ equity 324 11 5,341 421 6,097 2,642 8,739
Total changes in the period — 31 9,736 94 9,862 324 11 5,341 421 6,097 2,642 18,601
Balance as of March 31, 2014 ¥3,694 ¥3,451 ¥98,381 ¥(786) ¥104,740 ¥7,496 ¥11 ¥(3,511) ¥421 ¥ 4,417 ¥20,434 ¥129,591
Note: U.S. dollar amounts have been translated from yen for convenience only, at the rate of ¥102.92=U.S.$1, the approximate Tokyo foreign exchange market rate as of March 31, 2014.
Consolidated Balance Sheets
(Unaudited)
Nissin Kogyo Co., Ltd. and Consolidated Subsidiaries March 31, 2013 and 2014Consolidated Statements of Changes
in Net Assets
(Unaudited)
Millions of yen
Thousands of U.S. dollars
LIABILITIES AND NET ASSETS 2013 2014 2014
Current liabilities:
Short-term borrowings ¥ 2,310 ¥ 4,826 $ 46,891
Notes and accounts payable 23,968 28,015 272,202
Accrued expenses 2,486 2,858 27,769
Accrued income taxes 1,323 1,354 13,156
Other current liabilities 4,132 2,944 28,605
Total current liabilities 34,219 39,997 388,622
Long-term liabilities:
Deferred income taxes 4,182 5,560 54,023
Accrued retirement benefits 1,287 — —
Retirement benefits for directors and corporate auditors 118 142 1,380
Other long-term liabilities 1,584 2,249 21,852
Total long-term liabilities 7,170 7,951 77,254
Net assets
Shareholders’ equity:
Common stock:
Authorized: 150,000,000 shares Issued: 65,452,143 shares in 2013
Issued: 65,452,143 shares in 2014 3,694 3,694 35,892
Capital surplus 3,419 3,451 33,531
Retained earnings 88,645 98,381 955,898
Treasury stock, at cost;
466,900 shares in 2013 and 466,900 shares in 2014 (880) (786) (7,637)
Total shareholders’ equity 94,878 104,740 1,017,684
Valuation, translation adjustments and others:
Net unrealized holding gain on investment securities 7,173 7,496 72,833
Deferred gains or losses on hedges — 11 107
Foreign currency translation adjustments (8,852) (3,511) (34,114)
Total valuation, translation adjustments and others (1,679) 4,417 42,917
Minority interests 17,792 20,434 198,543
Total net assets 110,991 129,591 1,259,143
Total liabilities and shareholders’ equity ¥152,381 ¥177,540 $1,725,029
Thousands of U.S. dollars Shareholders’ equity Valuation and translation adjustments
Common stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’
equity
Net unrealized holding gain on investment securities
Deferred gains or losses on hedges
Foreign currency translation adjustments
Net accumulative adjustment to retirement
benefits
Total valuation, translation adjustments and others
Minority interests
Total net assets Balance as of March 31, 2013 $35,892 $33,220 $861,300 $(8,550) $ 921,862 $69,695 $ — $(86,009) $ — $(16,314) $172,872 $1,078,420 Changes in the period:
Dividends (23,941) (23,941) (23,941)
Net income 118,539 118,539 118,539
Cancellation of treasury stock (0)
Increase (decrease) in treasury stock due to changes in equity among affiliates
accounted for by the equity method 913 1,224 1,224
Net changes of items other than
stockholders’ equity (0) (0) 3,148 107 51,895 4,091 59,240 25,670 84,911
Total changes in the period — 301 94,598 913 95,832 3,148 107 51,895 4,091 59,240 25,670 180,733
Millions of yen
Thousands of U.S. dollars
2013 2014 2014
Net sales ¥174,251 ¥220,868 $2,146,016
Cost of sales 153,022 187,998 1,826,642
Gross profit 21,230 32,871 319,384
Selling, general and administrative expenses 12,468 13,454 130,723
Operating income 8,762 19,417 188,661
Other income (expenses):
Interest and dividend income 896 931 9,046
Interest expense (27) (55) (534)
Foreign exchange gain (loss), net 870 1,012 9,833
Gain on sale of securities — 610 5,927
Loss on disposal of fixed assets (60) (130) (1,263)
Equity in earnings of affiliates 93 — —
Other, net (328) 60 583
Other income, net 1,444 2,428 23,591
Income before income taxes and minority interests 10,205 21,845 212,252
Income taxes
Current 3,207 4,173 40,546
Deferred (702) 1,311 12,738
Income before minority interests 7,701 16,360 158,958
Minority interests 2,777 4,160 40,420
Net income ¥ 4,924 ¥ 12,200 $ 118,539
Note: U.S. dollar amounts have been translated from yen for convenience only, at the rate of ¥102.92=U.S.$1, the approximate Tokyo foreign exchange market rate as of March 31, 2014.
Millions of yen
Thousands of U.S. dollars
2013 2014 2014
Income before minority interests ¥ 7,701 ¥16,360 $158,958
Other comprehensive income
Net unrealized holding gain on investment securities 1,136 324 3,148
Deferred gains or losses on hedges — 11 107
Foreign currency translation adjustments 5,293 5,685 55,237
Share of other comprehensive income of associates accounted for
using equity method 293 53 515
Total other comprehensive income 6,722 6,073 59,007
Comprehensive income ¥14,422 ¥22,434 $217,975
(Comprehensive income attributable to)
Comprehensive income attributable to owners of the parent ¥10,130 ¥17,876 $173,688
Comprehensive income attributable to minority interests 4,292 4,558 44,287
Note: U.S. dollar amounts have been translated from yen for convenience only, at the rate of ¥102.92=U.S.$1, the approximate Tokyo foreign exchange market rate as of March 31, 2014.
Consolidated Statements of Income
(Unaudited)
Consolidated Statements of
Comprehensive Income
(Unaudited)
Nissin Kogyo Co., Ltd. and Consolidated Subsidiaries Years ended March 31, 2013 and 2014
Millions of yen
Thousands of U.S. dollars
2013 2014 2014
Cash flows from operating activities
Income before income taxes and minority interests ¥ 10,205 ¥ 21,845 $ 212,252
Depreciation and amortization 7,424 8,032 78,041
Amortization of negative goodwill (1) (2) (10)
Decrease in allowance for doubtful accounts (40) 11 107
Increase (decrease) in allowance for directors’ bonuses 6 37 360
Increase in allowance for product warranties 1,995 (1,129) (10,970)
Increase in accrued retirement benefits (153) (1,287) (12,505)
Increase in retirement benefits for directors and corporate auditors (2) 8 78
Decrease (increase) in retirement benefit assets — (418) (4,061)
Increase (decrease) in retirement benefit liabilities — 1,574 15,293
Interest and dividend income (896) (931) (9,046)
Interest expense 27 55 534
Foreign exchange gain, net 9 (131) (1,273)
Equity in earnings of affiliates (93) 106 1,030
Loss on sales of property, plant and equipment (323) (39) (379)
Loss on disposal of property, plant and equipment 60 130 1,263
Loss (gain) on valuation of short-term and long-term investment securities 542 (610) (5,927)
Increase in notes and accounts receivable—trade 1,198 (3,912) (38,010)
Increase in inventories 123 752 7,307
Increase in notes and accounts payable—trade (717) 1,269 12,330
Increase in accounts payable (701) 1,002 9,736
Other, net (418) (719) (6,986)
Subtotal 18,243 25,642 249,145
Interest and dividends received 897 932 9,056
Interest paid (27) (55) (534)
Income taxes paid (2,980) (4,118) (40,012)
Net cash provided by operating activities 16,134 22,401 217,654
Cash flows from investing activities
Decrease in time deposits (375) (58) (564)
Decrease in marketable securities (1,000) (2,000) (19,433)
Purchases of property and equipment (11,373) (13,172) (127,983)
Proceeds from sale of property and equipment 981 197 1,914
Purchase of intangible assets (541) (299) (2,905)
Purchases of investment securities (2,172) (1,085) (10,542)
Purchase of investments in subsidiaries 262 715 6,947
Collection of loans receivable 37 — —
Outgoings from lending (80) (1,133) (11,009)
Other, net (25) (103) (1,001)
Net cash used in investing activities (14,285) (16,940) (164,594)
Cash flows from financing activities
Decrease in short-term borrowings (186) 1,819 17,674
Repayments of finance lease obligations (420) (221) (2,147)
Dividends paid (1,942) (2,464) (23,941)
Dividends paid to minority shareholders (1,843) (1,853) (18,004)
Other, net 601 494 4,800
Net cash used in financing activities (3,790) (2,225) (21,619)
Effect of exchange rate changes on cash and cash equivalents 870 684 6,646
Net increase in cash and cash equivalents (1,072) 3,920 38,088
Cash and cash equivalents at beginning of year 27,402 26,331 255,839
Cash and cash equivalents at end of year ¥ 26,331 ¥ 30,251 $ 293,927
Note: U.S. dollar amounts have been translated from yen for convenience only, at the rate of ¥102.92=U.S.$1, the approximate Tokyo foreign exchange market rate as of March 31, 2014.
Consolidated Statements of Cash Flows
(Unaudited)
Naoetsu Plant
Corporate Headquarters and Ueda Plant Tobu Plant Nagano R&D Center Tochigi R&D Center
Nissin R&D Europe S.L.U.
Nissin Brake (Thailand) Co., Ltd. Nissin Brake Vietnam Co., Ltd.
Nissin R&D Asia Zhongshan Nissin Industry Co., Ltd.
Nissin R&D China
Shandong Nissin Industry Co., Ltd.
Nissin Brake Philippines Corporation
P.T. Chemco Harapan Nusantara P.T. Alcar Chemco Indonesia
Nissin Brake Ohio Inc.
Nissin Brake de Mexico, S.A. de C.V. Nissin R&D USA — East Liberty
Nissin Brake Georgia Inc.
Nissin Brake Do Brasil Ltda. (Manaus Plant)
[ Domestic ]
Corporate Headquarters and Ueda Plant
840 Kokubu, Ueda-city, Nagano 386-8505, Japan
Tel: +81-268-24-3111 Fax: +81-268-21-2533
Tobu Plant
801 Kazawa, Toumi-city, Nagano 389-0514, Japan
Tel: +81-268-62-1191 Fax: +81-268-62-1194
Naoetsu Plant
4370 Kamichihara, Jyoetsu-city, Niigata 942-0035, Japan
Tel: +81-255-43-1431 Fax: +81-255-43-1365
Nagano R&D Center
801 Kazawa, Toumi-city, Nagano 389-0514, Japan
Tel: +81-268-62-5293 Fax: +81-268-62-5285
Tochigi R&D Center
722-1 Fukuoka, Nasukarasuyama-city, Tochigi 321-0525, Japan
Tel: +81-287-88-1215 Fax: +81-287-88-1217
[ Overseas ]
SPAIN
Nissin R&D Europe S.L.U.
Ciencia, 33 08840 Viladecans (Barcelona), Spain
Tel: +34-902-410-999 Fax: +34-936-593-900 UNITED STATES
Nissin Brake Ohio Inc.
1901 Industrial Drive, Findlay, OH 45840, U.S.A. Tel: +1-419-425-6725 Fax: +1-419-425-6729
Nissin Brake Georgia Inc.
216 Thacker Drive, Rock Spring, GA 30739, U.S.A. Tel: +1-706-764-1239 Fax: +1-706-764-1086
Nissin R&D USA
25790 State Route 287, East Liberty, OH 43319-9500, U.S.A.
Tel: +1-937-642-7556 Fax: +1-937-642-2845
THAILAND
Nissin Brake (Thailand) Co., Ltd.
399 Mhutee 6 Chockchi-Ratchasrima Rd., Tambol Nongraveang, Amphur Muang Nakornratchasrima 30000, Thailand Tel: +66-4421-8375 Fax: +66-4421-8965
Nissin R&D Asia
Shinawatra Tower 3, 8th Floor, 1010 Viphavadi Rangsit Rd., Chatuchak, Chatuchak, Bangkok 10900, Thailand Tel: +66-2-967-7605 Fax: +66-2-967-7617
INDONESIA
P.T. Chemco Harapan Nusantara
Kawasan Industrial Jababeka Jl, Jababeka Raya Blok F No. 19-28 Cikarang 17530 Bekasi, Jawa Barat, Indonesia
Tel: +62-21-8934253 Fax: +62-21-8934256
P.T. Alcar Chemco Indonesia
Kawasan Industri Mitra Karawang Jl, Mitra Raya II Blok E7-12
Karawang 41361, Jawa Barat, Indonesia Tel: +62-267-8610088 Fax: +62-267-8610111 PHILIPPINES
Nissin Brake Philippines Corporation
RBF L-2 Lot 30-B Phase 1B, First Philippines Industrial Park, Tanuan, Batangas, Philippines 4233 Tel: +63-49-576-5946 Fax: +63-43-405-6406
CHINA
Shandong Nissin Industry Co., Ltd.
273 Century Avenue, Rushan City, Shandong Province, China
Tel: +86-631-6681246 Fax: +86-631-6681325
Zhongshan Nissin Industry Co., Ltd.
No. 34.37. Jian Ye Road Torch Hi-tech Industrial Development Zone, Zhongshan City,
Guangdong Province, P.R. China
Tel: +86-760-85338330 Fax: +86-760-85338331
Nissin R&D China
No. 2102 Zhonglu Shangwu Daisha, 47 Qiaolin Street, Linhe Dong Road, Tianhe Guangzhou Province, China 510610
Tel: +86-20-38869630 Fax: +86-20-38863600 VIETNAM
Nissin Brake Vietnam Co., Ltd.
Quat Luu Commune, Binh Xuyen District, Vinh Phuc Province, Vietnam
Tel: +84-211-386-6400 Fax: +84-211-386-6401
BRAZIL
Nissin Brake Do Brasil Ltda. (Manaus Plant)
AV. Dos Oitis, No. 534-Distrito Industrial, Manaus-Am, Brazil
Tel: +55-92-2121-4702 Fax: +55-92-3615-3979
Nissin Brake Do Brasil Ltda. (Sao Paulo Plant)
Rodovia Santos Dumont (SP 75), Km 23.5 Bairro Itaim Mirim, ITU-SP, Brazil
Tel: +55-11-3414-4001 Fax: +55-11-3414-4002 MEXICO
Nissin Brake de Mexico, S.A. de C.V.
Camino de acceso numero 652 Predio San Luis del Janamo
lrapuato, Guanajuato C.P.36835 Tel: Fax: +52-462-626-0308
INDIA
Nissin Brake India Pvt. Ltd.
SP-1-33-35, New Industrial Area, Phase-III, Neemrana-301705, Distt-Alwar (Rajasthan), India Tel: +91-1494-246733 Fax: +91-1494-246736
Nissin Brake Do Brasil Ltda. (Sao Paulo Plant) Nissin Brake India Pvt. Ltd.
Name: Nissin Kogyo Co., Ltd.
Established:
October 1953Paid-in Capital:
¥3,694 millionEmployees:
10,230Directors and Auditors:
(As of June 13, 2014)
President Eiji Okawara
Vice President Hideaki Yanagisawa
Senior Managing Directors Keiji Himori
Naotoshi Tamai
Executive Managing Director Junichi Beppu
Directors Kenji Terada Jyunya Takei Kenji Shimizu Kazuya Sato Yuichi Ichikawa
Statutory Auditors Kiyoshi Sakashita Yukio Takeuchi
Auditors
Norimasa Oguchi Hiroyuki Negishi
Shareholdings by Shareholder Type:
n Other Corporations
n Financial Institutions
n Individuals and Others
n Foreign Companies
n Securities Companies
Total Shares Issued and Outstanding:
65,452,143Number of Shareholders:
15,803Stock Listing:
Tokyo Stock Exchange, First SectionStock Code:
7230Transfer Agent:
Sumitomo Mitsui Trust Bank, Limited
1-4-1, Marunouchi, Chiyoda-ku, Tokyo, Japan
40.84
18.14 20.70
18.90
1.42
Principal Shareholders:
Name
Holdings (Thousands of Shares)
Voting Rights (%)
Honda Motor Co., Ltd. 22,682 34.65
Japan Trustee Services Bank, Ltd.
(Trust Account) 3,412 5.21
Daishin Sangyo Co., Ltd. 3,398 5.19
The Master Trust Bank of Japan, Ltd.
(Trust Account) 2,502 3.82
The Bank of New York,
Mellon SA/NY 10 2,106 3.21
Naoya Miyashita 1,963 2.99
Northern Trust Co. (AVFC)
Sub A/C Non-Treaty 841 1.28
Nissin Kogyo Employee Shareholding
Association 749 1.14
The Chase Manhattan Bank,
NA London SL Omnibus Account 564 0.86
Sumitomo Mitsui Banking Corporation 550 0.84
(%)
NISSIN KOGYO CO., LTD.
