Kobe Steel Ltd. said Monday it aims to expand its group net profit by more than 20 times by fiscal 2005 to 36 billion yen from 1.7 billion yen in fiscal 2002, which ended March 31.
In a consolidated midterm business plan for the three years through March 31, 2006, the leading steelmaker said its goals are to strengthen the profitability, performance and business foundation of the company.
Kobe Steel, founded in 1905, also aims to increase its pretax profit to 80 billion yen by fiscal 2005 from 35.4 billion yen in fiscal 2002, and to expand revenues to 1.25 trillion yen by fiscal 2005 from about 1.21 trillion yen in fiscal 2002.
The company said it will undertake cost reduction measures worth 40 billion yen on an unconsolidated basis during the three years.
Kobe Steel will also allocate 100 billion yen for capital spending on an unconsolidated basis during the three years to boost the competitiveness of its products and to improve its facilities, compared with 70 billion yen in the past three years.
Among other measures, the company pledged to continue creating distinctive and value-added products, services and technologies.
The company said it will deepen and increase the benefits from current alliances, while also promoting ties that contribute to higher profitability.
Kentucky plant eyed
Kobe Steel Ltd. announced Monday it plans to manufacture and market aluminum forgings in the United States. The product is used in automobile suspension systems.
The plan advocates the creation of a joint venture in Bowling Green, Ky., this month and the construction of a $32.7 million plant that will start production in June 2005, according to the steelmaker.
The joint venture, Kobe Aluminum Automotive Products LLC, will be formed with other partners, the details of which will be announced later, a Kobe Steel spokesman said.
The new company aims to generate annual sales of $25 million in 2006, the second year of operations, Kobe Steel said.