The Brexit effect because of weakening demand in the UK could not prevent Komori delivering a 4% increase in sales from Europe in the final three months of 2017.
“The fall off in the UK negatively affected Komori’s revenues,” says the chairman’s review of the period, adding that net sales in Europe increases 4.4% compared to the same period in 2016. It was a strong performance across the board as the company reported sales taking the year to date level to ¥63.9 billion (¥57.0 billion). This is a rise from £378.9 million to £424.8 million.
The company attributes the growth to strong demand for litho presses in its domestic market, where expansion in the electronics sector is also calling for high precision screen printing equipment. The stronger US economy is growing sales in North America while China’s 57.5% rise in sales reflects as much the formation of a Komori subsidiary operation in 2016 as the opportunities in the Chinese economy.
The additional sales also returned the company to profit, moving from a deficit of ¥716,000 (£4.8 million) to an operating profit of ¥1.3 billion (£8.6 million).
There was also growth on other parts of Asia where Komori has acquired Indian dealer Insight Communication and Print Solutions India. The prospects for further growth in India, dealer for the Japanese manufacturer since 2007, which are built on population growth and rising personal consumption, are such that the company felt it ought to control its own destiny in the rapidly expanding country.
The market for printing presses in India is expected to grow 10% as these effects take hold. “To seize these opportunities, Komori has thus decided to acquire shares of Insight and make it a subsidiary, stepping up its group operations aimed at penetrating the Indian market,” says the company.
Currently sales at Insight are around £2 million a year. Komori plans to expand service and support and increase marketing to grow its Indian business, developing approaches tailored to suit local conditions. “We believe that these initiatives will help local printing companies better utilise high value added printing solutions and enhance the efficiency of their operations, thereby contributing to the development of India’s printing industry,” it says.
Komori is buying its dealer for India in order to run a direct sales and service arm so exploit the potential in the fast growing economy which is expected to account for 10% rise in the number of presses sold over the next few years.