25 November 2018 Business

China provides boost to Komori

Japanese press supplier is down on sales at six-month point, but remains confident for the full financial year.

Sales at Komori dipped in the first half of the company’s financial year, but the company is confident that by the end of the year it will have recouped almost all the deficit thanks to an increase in incoming orders.

The ¥42.8 billion year of incoming orders was a 2% increase on last year, but below the company’s target for the year. The figure is also the same as sales for the first six months in the previous year. Sales for the equivalent period this year were ¥40.2 million.

This has had an impact on operating income which fell from a gain of ¥400 million to a loss of ¥300 million. This hardly made a dent in Komori’s cash pile of ¥443 billion.

Sales increases in China were balanced against declines in Japan, Europe, North America and other regions. The company says that while domestic sales dipped incoming orders were strong and above the level in 2017. And orders from Igas, where the focus was on Komori’s smart factory concept, have still to filter through.

Sales in Europe were hit by the uncertainty caused by Brexit and in comparison to the boost in business in 2017 that had been caused by tax breaks in France. In North America, despite improvements in the US economy, printers have been showing a reluctance to invest in litho presses, favouring digital machines.

Revenues in other regions were hit by currency fluctuations in emerging nations as a result of increasing US interest rates, while the Indian market has returned to some normality after the disruption caused by the withdrawal of high denomination notes at the end of 2016.

The 74% increase in sales from China, now Komori’s largest export market, is attributed to the improving economy and to printers both upgrading plants and relocating in response to tightening environmental regulations and to increasing automation to reduce dependency on manual labour.

Gareth Ward

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Komori has enjoyed a revival of business in China as a result of company moves, demand for improved eco performance and greater automation. European business has been hit by Brexit fears.

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