Komatsu reported its fiscal year 2013 results for the fiscal year ended March 31, 2014. The company reported a 3.6 percent increase in consolidated net sales from the previous fiscal year. Operating income rose by 13.7 percent, which translated into an operating income ratio of 12.3 percent, up 1.1 percentage points.
In the construction, mining and utility equipment business, while demand for mining equipment remained slack, demand for construction equipment increased in Japan, China and some other regions. The segment’s net sales rose 4.3 percent and its profit rose 15.9 percent.
In the industrial machinery and others business, while sales of sheet-metal and press machines were firm mainly in the automobile manufacturing industry, sales of wire saws further declined. As the loss of the inventories of wire saws was realized, net sales of industrial machinery and others declined 3.3 percent and the segment’s profit dropped 67.2 percent.
In FY14, the company expects Komatsu expects to meet a market environment in the construction, mining and utility equipment business that is more challenging than FY2013. Although demand is steady in North America and other regions, demand in rental companies has run its course in Japan and there has been a decline in demand for mining equipment resulting from the conservative mindset of mining customers for capital investment against the backdrop of sluggish commodity prices, the company says.
In the industrial machinery and others business, while demand for wire saws should remain depressed, Komatsu anticipates steady sales of press and sheet-metal machines as well as machine tools, especially to the automobile manufacturing industry. Komatsu will step up its group-wide efforts to reinforce business models designed to offer comprehensive merits to customers, and strive to expand sales in the entire value chain which includes not only sales of new equipment but also parts and service, rental-to-used equipment, and retail finance businesses. At the same time, Komatsu will also make continuous efforts to improve selling prices, production costs and the like.
As a result, Komatsu projects net sales for the fiscal year ending March 31, 2015 to decrease 3.8 percent and operating income to increase 1 percent.