On May 12, 2006, the Nippon Paint Group announced its consolidated business results for fiscal 2005 (ended March 31, 2006). The following is a summary of the results:
Despite the challenges caused by the slight decrease in shipments in terms of volume compared to the previous fiscal year, the Nippon Paint Group posted a 5.2 billion yen (2.5%) increase in consolidated net sales to 208 billion yen. This increase was entirely attributed to the paints and coatings business, while sales for the fine chemicals business remained nearly on a par with the previous fiscal year. Within the paints and coatings business, the automotive coatings segment enjoyed considerable sales growth of 10.8%, while sales in the industrial-use paints and coatings segment increased 2.4%. Trade-use paints suffered a 3.4% drop in sales due to difficulties faced in the business environment, such as record snowfalls and recent irresponsible practices in the construction industry, along with the Company's voluntary review of construction projects.
Faced with prolonged escalating prices for crude oil and naphtha, Group-wide efforts were concentrated on reducing manufacturing costs, while also working to improve sales and administrative efficiency. As a result, operating income rose 3.7% to 10.05 billion yen, while ordinary income increased 6.2% to 11.36 billion yen, due to an increase in non-operating income. With the aim of enhancing asset efficiency, the Nippon Paint Group posted gains or losses on the sale or disposal of investments in securities and property, plants and equipment. Mainly due to increased income tax payments, net income declined 0.54 billion yen (7.5%) to 6.58 billion yen.
In this milestone year marking the 125th anniversary of Nippon Paint foundation, April 1 marked the day we launched our long-term management plan targeting the year 2010. This plan is intended to totally review the Nippon Paint Group's operating base, improve weak areas, and transform the Nippon Paint Group into a corporate group that can earn a greater reputation worldwide. We are determined to exert concerted and united efforts to make a significant leap forward toward achieving our goals for the year 2010
Please join us in looking ahead to the successful transformation of the Nippon Paint Group.
