The Company's Middle
and Longer Term Business Strategy and Challenges to Overcome
The economic outlook suggests comparatively healthy growth in
the automotive and semiconductor industries, key sources of demand
for the Company’s products.
With progress in the adjustment of inventories of digital products, steady growth
in domestic capital investment is anticipated. There are, however, fears of a
slowdown in the U.S. economy as a result of the budget deficit. In China, there
is uncertainty as to the fallout from the appreciation of the renminbi. The rise
in prices of oil, coke and other materials has been prolonged. Public works are
being reduced. These factors create a highly challenging environment for the
Group, in which a false step would have dire consequences.
The Nippon Carbon Group is responding to these challenges by moving forward with
operational optimization. It is also continuing to develop high value-added products
and to cut production costs and other expenses for the aim of strengthening its
revenue base.
To achieve this objective, the Group will redouble its efforts to execute the
following principal policies to bolster profits:
| (1) |
Exceed the targets in the sales plan for the current fiscal year
and institute strict expense controls to slash production costs. |
| (2) |
Expand operations such as the overseas sales promotion of carbon
fiber products including general-purpose carbon fibers (GF) and carbon
fiber reinforced carbon composites (CCM) and achieve the timely development
and commercialization of next-generation lithium ion battery anode
material (LD). |
| (3) |
Establish a global strategy for ensuring that profitability is maintained
amidst the global competition in the mainstay products of the sectors
of graphite electrodes and chemical products |
| (4) |
Obtain outstanding human resources, deploy the workforce appropriately,
and implement a HR and employment policy that reflects social trends
to ensure the development of the Group.
As part of its initiative to construct a global strategy for mainstay products,
the Group signed a basic agreement for a business partnership, including manufacturing
and marketing, with France-based Carbone Lorraine on July 11, 2005. Under the
agreement, a joint venture will be set up to sell impervious graphite (RESBON)
of the Group’s chemical products division, enabling the Group to concentrate
its management resources and bolster its competitiveness.
Going forward, the Nippon Carbon Group will continue to improve its sales strength
and corporate structure by instituting measures to produce greater competitiveness
and profitability.
The Nippon Carbon Group believes that making a positive contribution to society
and fulfilling its corporate social responsibility so that it will win the trust
of the community are essential ingredients for sustained growth. The Group will
seek to improve its standing in the eyes of the public by continuing its commitment
to ethical and statutory compliance and its activities to preserve the environment. |
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