1. No category

Mediumterm Business Plan
for the Threeyear Period from FY3/14 to FY3/16
Our threeyear business plan is a "rollingstyle" business plan updated once a
year to
t adapt
d t tto changes
h
iin th
the b
business
i
environment
i
t and
d promote
t speedier
di
decisionmaking.
Overall image of mediumterm business plan
Mediumterm business plan
Stabilize and expand the light metals and copper products segment which forms the
core of the GROUP’s business foundation
Vision
Raise presence in minor metals and electronic and advanced materials markets
Also, work to create and cultivate new businesses that move beyond the conventional
Also
paradigm of a nonferrous metals trading company in order to drive growth, and
continue to expand the scope of existing businesses
Action Plans
to implement
l
the
h overallll strategy and
d enhance
h
corporate value.
l
1
2
Strengthen
h
operating
revenue
Promote
investment
activities
Copyright ©2013 ALCONIX CORPORATION All Rights Reserved
3
Reinforce
f
the
h
financial
backbone
4
Train human
resources
5
Strengthen
corporate
infrastructure and
internal governance
㪉㪈
Performance targets
Mediumterm business plan
E h
Enhance
corporate value
l and
d sustain
i growth
h on a consolidated
lid d basis
b i
Consolidated ordinary income:
Over 5,000 million yen (FY3/16)
Consolidated net income:
Over 3,000 million yen (FY3/16)
Profit
targets
Investment
plans
Management
benchmarks
ROE:
NET DER:
Around 1315% (FY3/16)
Around 1.01.3x (FY3/16)
3,0004,000 million yen over three years
*M&A investments will be considered separately.
Net Sales
Ordinary Income
Mediumterm business plan
(Unit: 100 million yen)
FY3/12
FY3/13
Actual
FY3/14
FY3/15
Plan
Copyright ©2013 ALCONIX CORPORATION All Rights Reserved
FY3/16
Mediumterm business plan
(Unit: million yen)
FY3/12
FY3/13
Actual
FY3/14
FY3/15
FY3/16
Plan
㪉㪉
Strengthen operating revenue 1
Action plan/Mediumterm business plan
((1)) Electronic
ect o c materials
ate a s bus
business
ess
ALCONIX will strengthen its efforts in the fields of crystal materials, metallic powder, LCD and battery materials, semiconductorrelated
materials, and advanced materials and other electronic materials. Also, it will work together with its subsidiary ADVANCED MATERIALS
JAPAN CORPORATION (AMJ) to strengthen its trading foundation for minor metals including titanium sponges, tungsten, and
molybdenum,
y
, and rare earths for mostlyy magnetic
g
materials applications,
pp
, in order to become a major
j force in the industryy offeringg
both supplies of raw materials (minor metals, rare earths) and products (electronic and advanced materials).
Materials
Products
IT
Minor metals
Rare earths
• Titanium sponge
• Tungsten
• Molybdenum
l bd
•
•
•
•
Crystal
materials
Metallic
powder
Neodymium
Dysprosium
L th
Lanthanum
Others
LCD and
battery
materials
Semicond
uctor
related
materials
Automobiles
Advanced
materials
Consumer electronics
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㪉㪊
Strengthen operating revenue 2
Action plan/Mediumterm business plan
(2) Environment
Environmentrelated
related businesses
ALCONIX will strength its businesses and investment in environmentrelated fields. It will expand its trading of various
materials for solar cells, fuel cells, electric vehicles, hybrid vehicles, and ecodiesel engines, as well as LED materials for
energysaving applications. It will also proactively build a recycling business not limited to nonferrous materials in Japan
and overseas
overseas.
Titanium
Resource recycling
Large volumes used in structural parts to lighten
aircraft and in piping equipment for desalination
aircraft,
plants
Natural resource recycling
y g
(especially minor metals and rare
earths) will become increasingly
important going forward
Metal silicon
Recycled aluminum ingots/Metal scraps
Large volumes used in
solar cells
Gallium metal, sapphire wafer
Necessary for
N
f LED b
bulbs
lb and
d LED ttraffic
ffi signals
i l which
hi h are
garnering attention as energysaving light sources
Electronic
materials, etc.
Rare earth
Magnetic materials are necessary for eco car
(electric and hybrid vehicles) and wind power
generation turbines
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Automobile engines
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Strengthen operating revenue 3
Action plan/Mediumterm business plan
(3) Overseas business
Overseas network
1 Expand local transactions
Expand local transactions with Japanese companies overseas and
foreign companies
ALCONIX advantages
High ratio of overseas trade, and large
trade volumes with China
2 Expand trilateral business
More triangular transactions, using our overseas network
Value of trade (FY3/13, consolidated)
Domestic trades
Local transactions of overseas
subsidiaries ((incl. trilateral
transactions)
ALCONIX GROUP's
net export sales
3 Expand overseas network
Promote establishing branches in Indonesia and India to extend
the overseas network
ALCONIX GROUP's sales from
ALCONIX
GROUP's sales from
import transactions
import transactions
ᵈ䋩ャ౉ขᒁ䈮䉋䉎ᄁ਄㜞䈮䈲ਃ࿖㑆ขᒁ䉕฽䉃
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㪉㪌
Promotion of investment activities 1
Action plan/Mediumterm business plan
(1) Overview
O
i
We will promote M&A which is effective for shortterm business expansion, investment in/lend to metals fabrication and
sales to develop new trade channels, and investment in recycling and other projects to secure natural resources.
M&As 10 cases (actual)
z Acquired 100% of the stock in OHBA SEIKEN CO., LTD. and made
it a consolidated subsidiary (April 2013)
The acquisition of OHBA SEIKEN, a manufacturer of precision machining
parts of industrial machinery. ALCONIX expects synergies from
operations of its subsidiary OHKAWA CORP.
*See p4 for details.
z Acquired 100% of the stock in UNIVERTICAL CORPORATION and
other companies and made them consolidated subsidiaries
(December 2012)
The acquisition of a company that makes plating materials for the auto
and electronics industries will enable us to enter the enormous North
American and Chinese markets.
z Acquired 100% of the stock in OHKAWA CORP. and made it a
consolidated subsidiary (August 2009)
z Acquired of the stock of ADVANCED MATERIAL JAPAN
CORPORATION and made it a consolidated subsidiary (January
2004)
Business investments 29 cases (actual)
z Acquired 25% of the stock of Shanghai Longyang Precise
Compound Copper Tube Co., Ltd. and made it an equity
method affiliate (April 2012)
The acquisition of an equity stake in the core company of the
Golden Dragon Group, the world’s largest manufacturer of
precision copper tubes, helped us to create new channels of
commerce via the sale of this affiliate’s products, and to expand
global sales of copper tubes.
z Acquired 35% of the stock of Hangji Chuangfu (Foshan)
Metal Product Co., Ltd. and made it an equitymethod
affiliate (September 2012)
As a joint venture with Guangdong Hangji Metal Product Industries
Co., Ltd., a major capital group in Guangzhou, the affiliate helps
ALCONIX expand commerce to Japanese auto and consumer
electronics makers in south China.
Also invested in 27 other businesses in Japan and abroad.
These affiliates have contributed to the creation and
expansion of ALCONIX's business.
Also invested in 6 other businesses in Japan. These consolidated
subsidiaries have contributed to the earnings.
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㪉㪍
Promotion of investment activities 2
Action plan/Mediumterm business plan
P j
d consideration
id
i
(2) Projects
under
Metals and chemical
products fabrication
p
• Joint venture for metal processing parts manufacture in China
Securing natural
resources
• Establish a company in China for the manufacture and sale of metal
silicon
• Expansion of UNIVERTICAL's overseas production sites (new sites
and new production lines)
• Expansion of nonferrous metals recycling business through business
acquisition
• Invest in/lend to minor metal and rare earth mines overseas, and
refining businesses
• Invest in/lend to rare metal trading companies
companies, etc
etc. overseas
M&A
• Promote other M&A (upstream: manufacturers and recycle centers;
midstream: trading firms; downstream: wholesalers and retailers)
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㪉㪎
Action plan/Mediumterm business plan
Reinforce the financial backbone
• Aim to improve the shareholders’ equity ratio and other financial ratios by bolstering profitability
• Further diversify fundraising channels to secure liquidity and reduce funding costs
• Strive to optimize working capital and keep free cash flow in the black
Train human resources
• Proactively work to hire talented human resources, and
improve labor productivity by appropriately positioning
employees and bolstering internal training
• Aim to train “professional,” “challenging,” and
cooperative human resources,
resources in line with the Company’s
Company s
“cooperative”
personnel policy
Strengthen corporate infrastructure
•Aim for more speedy management and a stronger internal governance system through more effective use of the new
missioncritical system
•Improve the Group’s accounting system in preparation for the introduction of international financial reporting standards
(IFRS)
•Strengthen administrative framework to prepare for increase and diversification of subsidiaries and affiliates
•Continue to conduct internal training for all employees to enhance timely disclosure
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㪉㪏
Strengths of the ALCONIX GROUP
Action plan/Mediumterm business plan
1) Powerful organizing functions linking demand and supply
The ALCONIX GROUP is a trading firm that specializes in nonferrous metals from upstream to
downstream functions (final manufacturing)
See “Business fields" on page 39
䉝䊦䉮䊆䉾䉪䉴䉫䊦䊷䊒䈱ᒝ䉂
2) Topclass performance in minor metals and rare earth for electronic materials
Share of import volumes to Japan: 50% of metal titanium, 70% of nickel powder, almost 30% of rare
earths, and more than 30% of tungsten compounds; share of export volumes from Japan: almost 20% of
titanium products
See “Market position (share)” on page 49
3) Solid overseas network
11 overseas subsidiaries, 16 locations
Our proprietary network of overseas subsidiaries plus the overseas sites of an agency
See “Solid overseas network” on page 37
4) Successful M&A
Concluded 10 M&As and invested in 29 companies (including 17 after the MBO)
Wide range of business investments (in line with strategy of expanding business fields)
5) Staff with rich experience
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㪉㪐