2010 losses for Kobelco

By Euan Youdale05 May 2011

Kobelco Cranes saw sales and income decrease during its full 2010 financial year as a result of "sluggish" demand in core markets, except some parts of Asia.

Parent company Kobe Steel reported a crane segment sale drop of 25.8% to 40.9 billion Yen (US$499 million) in its results for the year ending 31 March 2011, compared to the previous year.

Ordinary income decreased 2.5 billion yen ($31 million), compared with the previous year, to a loss of 1.3 billion yen ($16 million).

The figures stand in contrast to sales in Kobe Steel's construction equipment segment. For example, sales of hydraulic excavators in China, a major market, increased substantially, compared with the previous year, said the company. Sales also increased in Southeast Asia, which saw continued recovery in demand, and Japan, where demand began to recover, said the company.

As a result, segment sales increased 45.9% compared to 2009, to 313.1 billion yen ($3.9 billion). Ordinary income increased 20.7 billion yen ($259 million) to 26.3 billion yen ($329 million).

"Japan's economy in fiscal 2010 on the whole continued to gradually recover as overseas economies improved, although the third quarter saw a slowdown in the pace of recovery due to a retrenchment in economic measures and the effect of the high yen. In overseas markets, too, the Chinese economy expanded," said a company spokesman.

Overall, Kobe Steel, which includes a number of other segments: iron & steel, welding, aluminum & copper, machinery and natural resources & engineering, saw net sales increase 187.5 billion yen ($2.3 billion) to 1.9 trillion yen ($23.2 billion). Net income went up 46.6 billion yen ($583 million) to 52.9 billion yen ($662 million).

"The world economy in fiscal 2011 is anticipated to continue recovering, driven mainly by China and other emerging countries. In each business segment, demand is anticipated to remain strong in fields of expected growth and overseas markets centred mainly on emerging countries. On the other hand, sluggish demand within Europe resulting from belt-tightening policies and a general decrease in manufacturing activity due to the great east Japan earthquake are issues of concern," concluded the company spokesman.

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