May 24, 2016,09:00 +0900(JST) Attended the IWCC General Assembly and Joint Meeting in Cape Town

From May 8 to 11, I attended the International Wrought Copper Council (IWCC) General Assembly and Joint Meeting, which was held in Cape Town, South Africa. Held annually, the event draws representatives from a variety of parties connected to the copper industry, such as from mining companies, refining companies, fabricating companies, trading firms, exchanges, and government agencies. In the event, participants exchange opinions on a wide range of topics such as technological progress, situations in the industry, and global economic trends.

At this year's event, partly because the host country was South Africa, many presentations were given regarding the African economic and political situations, with an emphasis on the region's mining activities. This made me reflect deeply on my lack of daily efforts to keep up with the African political, economic, and social situations.

The event attracted more than 200 participants from around the world, including about 30 from Japan. They paid much attention to changes in the price trends of commodities in general, especially copper price trends.

Rapid price changes have a considerable impact on fabricating companies. There is no option but to accept structural changes in the entire industry, such as changes of the management policy of the London Metal Exchange (LME) and the speculative entry of different industries into the market. However, each related sector needs to make some kind of contribution and do its best to ensure sound development of the copper industry.
In particular, it is necessary to recognize with a sense of crisis that customers, who are the end users, are keenly aware of the instability of the copper market, and are seriously considering substitutes. As indicated by the LME warehousing problem, some people care only about themselves, but I have always asserted that this attitude is never acceptable in terms of sound development of the copper industry. Still, since the interests of each party concerned are interrelated in a complicated manner, it is difficult to solve the problem.

At Table Mountain and Signal Hill, commanding a panoramic view of Cape Town
At Table Mountain and Signal Hill, commanding a panoramic view of Cape Town

May 23, 2016,15:30 +0900(JST) FY 2015 Business Results

On May 13, we announced to the public our FY 2015 business results.
Our business results on a consolidated basis for FY 2015 were as follows: net sales of 2,933.1 billion yen; operating income of 143.5 billion yen; and ordinary income of 165.7 billion yen, with all the figures showing an increase from the previous fiscal year. Net sales, up 110.3 billion yen from the previous fiscal year, marked a record high for the second consecutive fiscal year. Meanwhile, net income attributable to owners of the parent decreased to 91 billion yen from FY 2014, when extraordinary profit was generated by the sale of our shares in Sumitomo 3M (currently 3M Japan). Although all the net sales, operating income, and ordinary income fell short of the announced forecasts, net income attributable to owners of the parent exceeded the forecast figure. This is largely thanks to your generous support, and I would like to express my deep appreciation to you all.

We announced our forecasts for FY 2016 consolidated results as follows: net sales of 2,950 billion yen; operating income of 160 billion yen; ordinary income of 185 billion yen; and net income of 100 billion yen.

It is less than two years before the deadline that we set under our mid-term business plan VISION 2017 to accomplish the targets including net sales of 3,300 billion yen and operating income of 200 billion yen. Our forecast figures for this fiscal year serve as a milestone toward the accomplishment of the targets.
Meanwhile, looking at the economic situation since the beginning of this year, I feel that although the economy was on a gradual recovery trend before, the uncertainty over the future is now evidently increasing due to a wide variety of risk factors. With this backdrop, I have disseminated to employees my message saying that nothing is more important than to vigorously promote improvement in terms of SEQCDD (Safety, Environment, Quality, Cost, Delivery, and Research and Development), which underpins the operations of manufacturers, and to establish an even more robust corporate structure to enable us to withstand environmental changes.

We look forward to again receiving your continued support this fiscal year.

【FY 2015 Business Results】

(Millions of Yen)

  2014 2015 Change
Net Sales 2,822,811 2,933,089 110,278
Operating Income 134,457 143,476 9,019
Ordinary Income 160,597 165,658 5,061
Profit Attributable to Owners of the Parent 119,771 91,001 ▲28,770

【Forecasts for FY 2016 Business Results】

(Millions of Yen)

  Net Sales Operating Income Ordinary Income Profit Attributable to Owners of the Parent
At Year-End 2,950,000 160,000 185,000 100,000
Fact Book FY2015 4th Edition [PDF:1.1 MB]

May 6, 2016,13:45 +0900(JST) Visit to Miharu Town of Tamura County, Fukushima

I would like to sincerely pray for the repose of the souls of those who lost their lives in the earthquakes that struck the Kumamoto area. I also would like to express my deep sympathy for those who were seriously affected by the disaster.

On Thursday, April 14, I visited Miharu Town in order to conclude a basic location agreement with Fukushima Prefecture and with Miharu Town regarding the new plant of Tohoku Sumiden Precision Co., Ltd., which will be established as one of our cutting tool-production bases. Last December, we made a public announcement of the establishment of the new plant. In the morning of my visit, it was unfortunately cloudy, but I was able to view a full bloom of the Miharu Takizakura (cherry tree whose flowers spread like a waterfall), before attending the agreement conclusion ceremony.

  • Visit to Miharu Town of Tamura County, Fukushima
  • Visit to Miharu Town of Tamura County, Fukushima

Held at the town's interaction facility Mahora, the conclusion ceremony was attended by Fukushima Governor Masao Uchibori, Miharu Town Mayor Yoshinori Suzuki, Director-General for Regional Economic and Industrial Policy Setsuo Iuchi of the Ministry of Economy, Trade and Industry, and other parties concerned.
Around Miharu Town are our major customers in the field of cutting tools. In addition, the city serves as a traffic hub. Maximizing these geographical advantages, we would like to further expand our sales and ensure that Tohoku Sumiden Precision develops together with the local community for many years to come.

After the ceremony, I spoke with former Mayor Hiroshi Ito of Miharu Town. We had quite a good time talking about Prof. Tsuru, who had taught both of us at Hitotsubashi University, our alma mater.

SUMITOMO ELECTRIC President CEO Masayoshi Matsumoto

Born in 1944 in Hyogo Prefecture, Masayoshi Matsumoto joined Sumitomo Electric in 1967. After serving as General Manager of Chubu District Office, Managing Director and Senior Managing Director, he assumed office of President and CEO in June 2004.

His leisure activities include jogging, reading and art appreciation. Also a seasoned athlete, he played baseball in junior high school and practiced judo in senior high school. In university, he threw the javelin competitively and participated in all-Japan inter-university competitions.

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