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NAGASAKI—Mitsubishi Heavy Industries Ltd., Japan’s
third-largest shipyard, aims to more than double
earnings from its shipbuilding operations next fiscal
year, helped by demand for vessels to carry goods to and
from China.
Operating profit at the Tokyo-based company’s
shipbuilding and marine business will climb to about ¥10
billion ($97 million) in the financial year starting
April 1, from an estimated ¥4 billion this year, Shiro
Iijima, managing executive officer in charge of
shipbuilding, said Wednesday.
Mitsubishi Heavy, which builds ships ranging from
liquefied natural-gas tankers to container vessels, is
seeking to tap demand from shipping lines to carry
Chinese imports of raw materials and exports of finished
goods to the rest of the world.
The
company, which gets 9 percent of sales from the
business, will invest ¥50 billion in the unit by 2010,
Iijima said. Iijima was speaking to reporters Wednesday
at the Nagasaki shipyard, located in Japan’s southern
island of Kyushu.
Mitsubishi Heavy expects its operating profit margin to
widen to 5 percent to 6 percent in the year ending March
2012, from this year’s 1.4 percent estimate, Iijima
said.
South Korea
ended Japan’s 44-year reign as the world’s largest
shipbuilder in 2000. China overtook Japan as the
second-largest shipbuilding nation by new orders in 2006
and extended its lead last year, threatening to also
surpass
Japan
by construction.
Shares
of Mitsubishi Heavy gained 1.9 percent to close at ¥436
on the Tokyo Stock Exchange Wednesday.
The
Nagasaki shipyard installed the nation’s largest crane
that’s able to hoist parts weighing as much as 1,200
tons at the 1-kilometer dock, Mitsubishi Heavy said on
February 20. The addition of the crane enables the
shipyard to build the equivalent of seven liquefied
natural-gas carriers a year, up from five now.
Mitsubishi Heavy’s shipbuilding division will have an
operating profit of ¥4 billion for the year ending March
31, as it delivers vessels from contracts won at higher
rates in 2004 and 2005, according to a February 6
estimate from Mitsubishi Heavy.
The
division incurred losses in the previous four years as
prices were not sufficient enough to absorb increased
steel costs.
Steelmakers, including Posco and Nippon Steel Corp.,
plan to charge more for steel plates used in ships to
counter higher raw-material costs.
Nippon
Steel seeks to increase domestic contract prices by
¥20,000 a metric ton for plates for the year starting
April 1, company officials, who asked not to be
identified, said last month. Prices this year ranged
between about ¥70,000 and ¥80,000.
The
Shipbuilders’ Association of Japan, which represents 20
Japanese builders of vessels, will seek to establish a
pricing system that enables shipbuilders to charge
raised costs onto buyers, a similar price structure
adopted for commercial planes, chairman Masamoto Tazaki
said on February 19.
Ship
prices are typically set when shipyards receive orders
and builders are not able to charge more to customers
even when additional costs are incurred. Ships are
typically delivered three to four years after contracts
are made. (Bloomberg) |
