Financial Results for the Third Quarter ended December 31, 2017
(Consolidated financial results have been prepared in accordance with accounting principles generally accepted in Japan)
February 9, 2018
HANWA Co.,Ltd. | ||
Company name: | Listed stock exchange: Tokyo | |
Stock exchange code: | 8078 | (URLhttp://www.hanwa.co.jp) |
Representative: | ||
Enquiries: |
Hironari Furukawa Yoichi Nakagawa
President
Director, Managing Executive Officer
TEL 81 - 3 - 3544 - 2000
The date of issue of audited financial statements:
February 14, 2018 The date of payout of dividend:
―
(Rounded down to millions of yen)
1.Consolidated financial results for the third quarter ended December 31, 2017
(1) Consolidated operating results
(% of change from the same period of previous year)
Net sales | Operating income | Ordinary income | Net income attributable to owners of the parent | |
For the third quarter ended December 31, 2017 ended December 31, 2016 | (Millions of yen) (%)
| (Millions of yen) (%)
| (Millions of yen) (%)
| (Millions of yen) (%)
|
Note: Comprehensive income
For the third quarter ended December31, 2017 | 15,486 million yen | 22.5 | % |
For the third quarter ended December 31, 2016 | 12,646 million yen | 120.9 | % |
Net income per share | Net income per share(diluted) | |
For the third quarter ended December 31, 2017 ended December 31, 2016 | (yen) 289.14 237.74 | (yen) - - |
* Effective October 1, 2017, HANWA consolidated its common shares at the ratio of 5 shares to 1 share. Accordingly, net income per share has been calculated as if the said share consolidation was conducted at the beginning of the previous fiscal year.
(2) Consolidated financial position
Total assets | Net assets | Shareholders' equity ratio | Shareholders' equity per share | |
December 31, 2017 March 31, 2017 | (Millions of yen) 893,490 694,232 | (Millions of yen) 196,655 171,637 | (%) 20.4 24.5 | (yen) 4,489.34 4,193.50 |
As of December 31, 2017
Note: Shareholders' equity
As of March 31, 2017
182,439 million yen 170,422 million yen
* Effective October 1, 2017, HANWA consolidated its common shares at the ratio of 5 shares to 1 share. Accordingly, shareholders' equity per share has been calculated as if the said share consolidation was conducted at the beginning of the previous fiscal year.
2.Cash dividends
Cash dividends per share | |||||
(effective date) | First quarter | Second quarter | Third quarter | Year-end | Annual |
Year ended March 31, 2017 | (yen) - | (yen) 9.00 | (yen) - | (yen) 10.00 | (yen) 19.00 |
Year ending March 31, 2018 (estimated) | - | 10.00 | - | ||
50.00 | - |
* Effective October 1, 2017, HANWA consolidated its common shares at the ratio of 5 shares to 1 share. Accordingly, the impact of this share consolidation is taken into consideration in the amount presented for the fiscal year-end dividend per share for the year ending March 31, 2018 (estimated), and the amount for the total annual dividends per share for the same fiscal year is omitted and shown as a dash.
3.Forecast of consolidated financial results for fiscal year ending March 31, 2018
(% of change from previous year)
Net sales | Operating income | Ordinary income | Net income attributable to owners of the parent | Net income per share | |
Annual | (Millions of yen) (%) 1,700,000 12.3 | (Millions of yen) (%) 25,500 8.9 | (Millions of yen) (%) 24,000 4.8 | (Millions of yen) (%) 16,000 (2.2) | (yen) 391.98 |
* Effective October 1, 2017, HANWA consolidated its common shares at the ratio of 5 shares to 1 share. Accordingly, net income per share reflects the impact of the said share consolidation.
* The above forecasts reflect assumptions and prospects based on the information currently available.They are subject to a number of risks and uncertainties that could cause actual results to differ materially from this information.
-1-
《Consolidated Balance Sheets》
(Rounded down to millions of yen)
Millions of yen
March 31, 2017 | December 31, 2017 | |
Assets | ||
Current assets; | ||
Cash and deposits | 28,465 | 53,553 |
Trade notes and accounts receivable | 307,853 | 391,413 |
Electronically recorded monetary claims | 30,742 | 36,218 |
Securities | 486 | 238 |
Inventories | 111,039 | 131,108 |
Others | 59,519 | 60,963 |
Allowance for doubtful receivables | (334) | (458) |
Total current assets | 537,773 | 673,038 |
Fixed assets; | ||
Property and equipment; | ||
Land | 29,640 | 32,420 |
Others | 29,852 | 31,957 |
Total property and equipment | 59,492 | 64,378 |
Intangible assets | 2,034 | 4,315 |
Investments and other assets; | ||
Investment securities | 72,524 | 105,652 |
Others | 22,912 | 47,330 |
Allowance for doubtful receivables | (504) | (1,225) |
Total investments and other assets | 94,932 | 151,757 |
Total fixed assets | 156,458 | 220,452 |
Total assets | 694,232 | 893,490 |
Liabilities; | ||
Current liabilities; | ||
Trade notes and accounts payable | 191,989 | 253,803 |
Short-term loans payable | 107,262 | 150,424 |
Commercial paper | 5,000 | 20,000 |
Current portion of bonds payable | 21 | 10,199 |
Income taxes payable | 6,752 | 2,720 |
Accrued bonuses | 2,306 | 1,406 |
Provision for product warranties | 146 | 116 |
Provision for loss on business of subsidiaries and affiliates | 512 | ― |
Others | 45,068 | 67,604 |
Total current liabilities | 359,058 | 506,274 |
Long-term liabilities; | ||
Bonds payable | 40,076 | 40,450 |
Long-term loans payable | 106,232 | 129,697 |
Retirement benefits liabilities | 4,518 | 4,713 |
Others | 12,709 | 15,698 |
Total long-term liabilities | 163,536 | 190,560 |
Total liabilities | 522,595 | 696,834 |
Net assets; | ||
Shareholders' equity; | ||
Common stock | 45,651 | 45,651 |
Retained earnings | 117,778 | 125,439 |
Treasury stock | (3,720) | (3,726) |
Total shareholders' equity | 159,709 | 167,364 |
Accumulated other comprehensive income; | ||
Net unrealized holding gains on securities | 12,580 | 17,235 |
Deferred hedge profit and loss | 142 | (512) |
Land revaluation difference | 2,966 | 2,966 |
Foreign currency translation adjustments | 1,062 | 864 |
Remeasurements of defined benefit plans | (6,037) | (5,479) |
Total accumulated other comprehensive income | 10,713 | 15,075 |
Minority interests | 1,214 | 14,216 |
Total net assets | 171,637 | 196,655 |
Total liabilities and net assets | 694,232 | 893,490 |
-2-
《Consolidated Statements of Income and Comprehensive Income》
(Rounded down to millions of yen)
Millions of yen
Third quarter ended | Third quarter ended | |
December 31, 2016 | December 31, 2017 | |
Net sales | 1,098,828 | 1,306,566 |
Cost of sales | 1,052,513 | 1,253,847 |
Gross profit | 46,315 | 52,719 |
Selling, general and administrative expenses | 29,987 | 33,920 |
Operating income | 16,327 | 18,799 |
Other income; | ||
Interest income | 883 | 1,328 |
Dividend income | 689 | 1,081 |
Foreign exchange gain | ― | 399 |
Others | 1,012 | 1,431 |
Total other income | 2,586 | 4,240 |
Other expenses; | ||
Interest expenses | 1,941 | 2,454 |
Loss on investment in affiliates | 154 | 1,913 |
Foreign exchange loss | 702 | ― |
Others | 1,063 | 1,296 |
Total other expenses | 3,862 | 5,664 |
Ordinary income | 15,051 | 17,375 |
Extraordinary income | ||
Gain on sales of investment securities | 522 | ― |
Reversal of allowance for business loss of affiliates | ― | 512 |
Total extraordinary income | 522 | 512 |
Extraordinary loss; | ||
Loss on devaluation of investments securities | 135 | ― |
Loss on devaluation of investments in capital | ― | 198 |
Business loss of affiliates | 222 | ― |
Total extraordinary loss | 358 | 198 |
Income before income taxes | 15,215 | 17,688 |
Income taxes | 5,443 | 6,637 |
Net income | 9,772 | 11,051 |
Net income attributable to | ||
Net income attributable to owners of the parent | 9,718 | 11,750 |
Net income(loss) attributable to minority interests | 54 | (699) |
Other Comprehensive Income | ||
Net unrealized holding gains on securities | 4,727 | 4,648 |
Deferred hedge profit and loss | 523 | (654) |
Foreign currency translation adjustments | (2,616) | 15 |
Remeasurements of defined benefit plans | 583 | 558 |
Share of other comprehensive income of affiliates | (344) | (130) |
Total other comprehensive Income | 2,874 | 4,435 |
Comprehensive Income | 12,646 | 15,486 |
Comprehensive income attributable to | ||
Comprehensive income attributable to owners of the parent | 12,792 | 16,111 |
Comprehensive income attributable to minority interests | (146) | (625) |
-3- |
HANWA co.,ltd.
Financial Results for the Third Quarter ended December 31, 2017
《Segment information》
Business segment information
The Companies' operations are classified into five business segments as follows:
Steel: Steel bars and shapes, steel plates and sheets, special steels, wire products, steel pipes, and steelmaking raw materials
Metals and alloys: Nickel, chromium, stainless scrap, silicon, manganese and steel alloys Non-ferrous metals: Copper, aluminium, lead, zinc, tin, antimony and other metals Foods: Frozen seafoods and meat products
Petroleum and chemicals : Petroleum products, chemical products, and cement Overseas sales subsidiaries: Wholesale trade, general merchandise
Segment information by business category for the third quarter ended December 31, 2016 and 2017, is as follows:
(Rounded down to millions of yen)
Third quarter ended December 31, 2016
Millions of yen
Reportable segment | Other | Total | Adjustment | Consoli-dated | |||||||
Steel | Metals & alloys | Non-ferrous metals | Foods | Petroleum & chemicals | Overseas sales subsidiaries | Sub-total | |||||
Net sales Customers Inter-segment | 557,697 9,066 | 92,967 2,375 | 55,925 1,129 | 70,087 292 | 189,666 5,070 | 77,743 46,770 | 1,044,088 64,704 | 54,739 1,265 | 1,098,828 65,970 | ― (65,970) | 1,098,828 ― |
Total | 566,763 | 95,342 | 57,055 | 70,379 | 194,737 | 124,513 | 1,108,793 | 56,005 | 1,164,798 | (65,970) | 1,098,828 |
Segment income(loss) | 13,080 | (855) | 184 | 2,326 | 1,855 | (779) | 15,812 | 1,444 | 17,256 | (2,204) | 15,051 |
Third quarter ended December 31, 2017
Millions of yen
Reportable segment | Other | Total | Adjustment | Consoli-dated | |||||||
Steel | Metals & alloys | Non-ferrous metals | Foods | Petroleum & chemicals | Overseas sales subsidiaries | Sub-total | |||||
Net sales Customers Inter-segment | 663,740 8,383 | 145,839 3,246 | 70,626 973 | 79,198 255 | 168,405 4,811 | 122,778 39,992 | 1,250,588 57,662 | 55,978 1,265 | 1,306,566 58,928 | ― (58,928) | 1,306,566 ― |
Total | 672,123 | 149,086 | 71,599 | 79,454 | 173,217 | 162,770 | 1,308,250 | 57,244 | 1,365,494 | (58,928) | 1,306,566 |
Segment income(loss) | 15,356 | 1,261 | 922 | 1,288 | 1,495 | 613 | 20,938 | 502 | 21,440 | (4,065) | 17,375 |
Notes:
1. "Other" comprises businesses that are not included in reportable segments, such as lumber section and machinery section.
2.
Adjustments for segment income include intersegment elimination and Group costs that have not been distributed to reportable segments. These group costs consist mainly of expenses of administrative departments.
3. Segment income or loss is adjusted between ordinary income on the consolidated statements of income and comprehensive income.
-4-
November 10, 2017
Highlights of Consolidated Financial Results for the 3rd Quarter of FY2017
Outline of Financial Results for the 3rd Quarter of FY2017
・As for the 3rd quater result for this fiscal year, net sales have increased by 19% in the same period of the previous year, hence reached to 1,306.5 billion yen, as market of steel products and metal resources being higher than the same period of previous year's level. Net profit was 11.7 billion yen, increased by 21%, due to increase in operating income of matals/alloys business and foreign exchange gain as opposed to the loss in the same period of the previous year.
・We paid 10 yen as interim dividend and plan to pay additional *50 yen as the end of this fiscal year dividend. (*:Display change of 10 yen forecast due to stock consolidation with 5 shares as 1 share on October 1.)
Segment Information
1Q-3Q of FY2016 | Year-on-year Changerate |
Net sales
1Q-3Q of FY2017
1Q-3Q of FY2016
rate
1,098.8 46.3 | 207.7 6.4 | 19% 14% |
29.9 | 3.9 | 13% |
16.3 | 2.4 | 15% |
2.5 3.8 | 1.6 1.8 | 64% 47% |
15.0 | 2.3 | 15% |
0.5 0.3 | (0.0) (0.1) | -2% -45% |
15.2 | 2.4 | 16% |
5.4 | 1.1 | 22% |
9.7 9.7 0.0 | 1.2 2.0 (0.7) | 13% 21% ― |
237.74 | 51.40 | 22% |
12.6 | 2.8 | 23% |
672.1 149.0 71.5 79.4 173.2 162.7 | 566.7 95.3 57.0 70.3 194.7 124.5 | 19% 56% 26% 13% -11% 31% |
1,308.2 | 1,108.7 | 18% |
57.2 | 56.0 | 2% |
1,365.4 | 1,164.7 | 17% |
(58.9) | (65.9) | -11% |
1,306.5 | 1,098.8 | 19% |
・ ・ ・
Segment income
1Q-3Q of FY2017
1Q-3Q of FY2016
rate
(Net sales)
Net sales have increased by 19% from the same period of the previous year. This was due to market recovery of steel products and metal resources from the second half of the previous fiscal year.
(SG&A expenses)
SG & A expenses have increased 3.9 billion yen from the same period of previous year. 1.5 out of 3.9 billion yen was accounted for newly consolidated subsidiaries.
Our personnel expenses have increased 1.5 billion yen, including 0.6 billion yen from newly consolidated subsidiaries.
(Non-operating income/expenses)
Non-operating income has increased by 64% from the same period of the previous year, mainly due to increase in interest income, dividend income and foreign exchange gain. Non-operating expenses have increased by 47%, due to increase in equity in losses of affiliates and interest expenses.
(Extraordinary gain/loss)
Reversal of allowance in previous year was recorded in extraordinary income, because the expected loss from restructuring of subsidiary was less.
For extraordinary losses, we recorded loss on valuation of investments of sale of subsidiary.
15.3 1.2 0.9 1.2 1.4 0.6 | 13.0 △0.8 0.1 2.3 1.8 (0.7) | 17% ― 401% -45% -19% ― |
20.9 | 15.8 | 32% |
0.5 | 1.4 | -65% |
21.4 | 17.2 | 24% |
(4.0) | (2.2) | -84% |
17.3 | 15.0 | 15% |
Main Factors
(Steel business)
Recovery trend of steel demand has been kept. Better market price resulted increased net sales due to high raw material prices and tightening supply/demand. Better margins in long term contracts pushed up the profit. (Metals & alloys business)
Net sales increased due to rising price level and sales expansion of stainless steel and ferro-alloy. Increase in profit on sale and recovery of Showa Metal's profit, which was a loss in the previous year, pushed up profit. (Non-ferrous metals business)
Due to rise in international commodity markets and increase in copper sales amount, revenue increased. In addition, foreign exchange loss in the same period of the previous year turned to foreign exchange gain.
(Foods business)
Rising price and strong sales due to reduction of overseas catch and low inventories increased net sales. Segment profit margin was shrunken by higher purchase costs.
(Petroleum & chemicals business)
Despite slow gain on petroleum products price, net sales decreased due to reduction of spot transactions. Segment income decreased, due to delay in pass-through of purchase cost increase and margin reduction of imported plastic products.
(Overseas sales subsidiaries)
Revenue increased because of increased sales of bunker fuel in Singapore, metal scrap in Thailand and Singapore, and steel products in Indonesia, China and US.
Apr. Acquired minority shares of the lithium carbonate producer, Bacanora Minerals Ltd.
May. Acquired additional stocks of the Chromite miner and Ferro-Chromium producer, Samancor Chrome Holdings. Oct. Acquired the producer of metal hardware products for use in architectural and civil construction.
Financial PositionDec. 2017
Mar. 2017 | Comparison with Mar. 2017 Changerate |
694.2 537.7 156.4 | 199.2 135.2 63.9 | 29% 25% 41% |
522.5 259.6 231.2 136% | 174.2 92.4 67.3 28pt | 33% 36% 29% ― |
171.6 159.7 10.7 1.2 4,193.50 | 25.0 7.6 4.3 13.0 295.84 | 15% 5% 41% ― 7% |
170.4 24.5% | 12.0 -4.1pt | 7% ― |
HANWA Co., Ltd.
(Unit: billion yen, rounded down to 0.1 billions of yen)
(Total Assets)
Total assets increased by 29% from the end of the previous year, due to increase in trade receivables and investment securities .
Inventories : 131.1 billion yen (+18% from the end of the previous year) Investment securities : 105.6 billion yen (+46% from the end of the previous year)
(including 47.6 billion yen of securities of subsidiaries and affiliates (+247%))
(Liabilities)
Total liabilities increased by 33% from the end of the previous year, due to the increase in trade payables and long and short term loans. As interest-bearing debt increased by 36%, net debt-equity ratio was turned into 164%.
(Net assets)
Total net assets increased by 15% from the end of the previous year, due to increase in minority interests of Japan South Africa Chrome Co., Ltd. and the carryover of retained earnings. Shareholders' equity ratio was 20.4%, which is a 4.1 percentage points lower than the end of the previous year.
【Changes in Net Sales】
【Quarterly Operating Results】
【Changes in Net Income】
【Changes in Interest-bearing Debt】
FY2016 | |
change | |
1,514.0 23.4 22.9 16.3 | 12% 9% 5% -2% |
FY2016 | FY2017 | FY2017 |
(estimated) | ||
9.00 10.00 | 10.00 ― | ― 50.00 |
19.00 24% | ― ― | ― 25% |
Hanwa Co. Ltd. published this content on 09 February 2018 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 09 February 2018 04:10:03 UTC.
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