KITZ Corporation (6498)
President Yasuyuki Hotta
Yasuyuki Hotta
Corporate Profile
KITZ Corporation
Code No.
TSE 1st Section
Machinery (Manufacturing)
1-10-1 Nakase, Mihama-ku, Chiba, 261-8577, Japan
Stock Information
Share Price Shares Outstanding Market Cap. ROE (actual) Trading Unit
¥487 107,215,289 shares ¥52.214 million 6.6% 100 shares
DPS (Est.) Dividend Yield (Est.) EPS (Est.) PER (Est.) BPS (actual) PBR (actual)
¥13.00 2.7% ¥46.63 10.4x ¥700.17 0.7x
* Share price as of closing on May 20, 2016. Number of shares outstanding as of most recent quarter end, does not include treasury shares.
Consolidated Earnings Trends
Fiscal Year Sales Operating
Net Income EPS (¥) Dividend (¥)
March 2013 111,275 6,558 6,521 4,039 36.98 9.50
March 2014 117,355 6,470 6,501 3,564 32.63 10.00
March 2015 117,036 6,886 7,581 6,881 63.22 13.00
March 2016 117,278 7,245 7,300 4,915 45.50 13.00
March 2017 Est 111,500 8,000 7,700 5,000 46.63 13.00
*Estimates are those of the Company. From fiscal year March 2016, the definition for net income has been changed to net income attributable to parent company shareholders (Abbreviated as parent company net income).
This Bridge Report presents details and analysis of KITZ Corporation's earnings for the fiscal year March 2016.
Key Points
Company Overview
KITZ is a comprehensive manufacturer of valves and other fluid control equipment and devices. In valve manufacturing, it ranks highest in Japan, and ranks in the top ten worldwide with a goal to becoming a top three company in the future. Various materials are used in valves depending upon their application, such as bronze, brass, cast iron, ductile cast iron (Cast steel with greater strength and ductile characteristics), and stainless steel. KITZ assumes integrated production (Casting, processing, assembling, inspecting, packaging, shipping) of products as its fundamental process. The KITZ group is comprised of 31 domestic and foreign subsidiaries. In addition to sales of brass and other bars used to make valves (KITZ is ranked amongst the top manufacturers of brass bars within Japan), KITZ also operates hotels.
Corporate Philosophy - KITZ is Dedicated to Sustained Enrichment of Its Corporate Values by Offering Unique and High Quality Products and Services -
"Corporate value" is the "medium to long term shareholder value", and the improvement in "medium to long term shareholder value" requires that KITZ contributes to the sustained growth in profits through the acquisition of its customers' trust. And by improving corporate value, the Company can make various contributions to shareholders, customers, employees, business partners and to the establishment of a prosperous society. Based upon these assumptions of the "KITZ Mission Statement", KITZ seeks to attain new achievements.
Action Guide
Do it KITZ Way
Do it True (Sincerity Honesty)
Do it Now (Speedy Timely)
Do it New (Creativity Challenge)
KITZ's Statement of Corporate Mission
To contribute to the global prosperity,
KITZ is dedicated to continually enriching its corporate value
by offering originality and quality
in all products and services.
Do it True
In relationships between people, what must not be forgotten is to relate to them with sincerity. The pursuit of the essence of things, rather than superficial things. "Do it True" are words that are designed to remind employees of these basic principles when conducting corporate activities.
Do it Now
"Do it Now" expresses the image of dynamic employees who lose no time in obtaining information, making prompt decisions, and putting them into practice with certainty.
Do it New
"Do it New" expresses the image of employees taking on new challenges in response to changes and leaving conventional ideas behind to express hidden creativity.
<Overview of KITZ's Business Segments>
KITZ's business is divided between the valve manufacturing, brass bar manufacturing, and others, including hotel and restaurant management, business segments. During fiscal year March 2016, each of these segments accounted for 79.8%, 17.5% and 2.7% of total sales respectively.
Valve Manufacturing Business
Valves are used to "pass," "stop," and "adjust the flow" of fluids and gases in various pipe systems (water, air, gas and other substances), and they are used in office and residential facilities, water works facilities, fresh and sewage water facilities, fire prevention facilities, machinery and industrial use manufacturing equipment, and chemical, medical, petrochemical product manufacturing facilities, semiconductor manufacturing facilities, petroleum refining and other industrial complexes, and other various applications. The corrosion resistant bronze and highly economical brass valves, and high value added ball, butterfly and industrial stainless steel valves are used particularly in the field of building residential and office facilities. In Japan, these valves are the main products with high market shares. KITZ customers operate within the building facilities, plant and engineering facilities, environment, energy, semiconductor, and other industries. The Company boasts of integrated manufacturing processes including the casting process, and it became the first company in Japan to acquire the "ISO9001 International Quality Standard Certification." The Company also pursues a strategy of increasing the global cost competitive characteristics of its products by fortifying its overseas manufacturing facilities.
Brass Bar Manufacturing Business
In the brass bars business, KITZ combines copper with zinc to create brass, tin and phosphorous to create phosphor bronze, and nickel and zinc to create nickel silver. These materials are then used in the dissolution, casting, rolling, pulling, forging, heating, and forming processes to create sheets, strips, pipes, bars, wires and other forms. The KITZ Group's brass bar manufacturing business is the operating realm of KITZ Metal Works Corporation and Hokuto Giken Kogyo Co., Ltd., and it uses the raw material of brass to manufacture brass bars, which it also sells. (Brass bars are used not only as materials for valves, but also in the manufacture of water faucets, gas equipment, electrical appliances and other various products.)
Other Business
Resort hotel operations (Suwa City, Nagano Prefecture) are conducted through the subsidiary Hotel Beniya Co., Ltd. Hotel Beniya is located in a highly picturesque setting close to Suwa Lake (Kohan) with hot spring bathing facilities with views of the sunset and various sized banquet halls. This hotel also boasts of panoramic views from the large public bathing facilities, small to large dining facilities, and conference rooms capable of hosting international conferences and large conventions.
<KITZ Group (Valve Manufacturing Business)>
As a comprehensive valve manufacturer, KITZ maintains extensive nationwide sales coverage through its network of distributors and its own sales offices in the major cities throughout Japan. In overseas markets, KITZ has developed a global sales network with representative offices in India, U.A.E. and Korea, and marketing offices in China, Singapore, Thailand, United States, Brazil, Germany and Spain. In the area of manufacturing, KITZ boasts of seven facilities in Japan and 12 production facilities overseas (China, Taiwan, Thailand, India, Germany, Spain, Brazil), which strive for optimized manufacturing in strategic locations.
The Japanese valve manufacturing business sells 43% of its products to building facilities applications, 14% to water works related applications (both fresh and sewage water), 10% to semiconductor related applications and 9% to machinery equipment applications. In addition, valves are also sold to petroleum refining and petrochemical, general chemicals, food, paper, gas, electric power and a wide range of other industry applications (As of fiscal year March 2016).
Overseas sales account for 39% of the valve manufacturing business. By geographic region, 21% of sales were derived from Asia (ASEAN and others 14%, China 6% and Middle East 1%), 12% from North America, and 5% from Europe and other regions as of fiscal year March 2016.
* ROE is calculated by multiplying "Net Profit Margin (net profit divided by sales)", "Asset Turnover (sales divided by total assets)" and "financial leverage (total assets divided by equity, reciprocal number of equity ratio)".
ROE="Net Income Margin" x "Asset Turnover" x "Leverage"
* The data in the table above is based upon figures taken from the official earnings announcement filings, and total assets and capital required to calculate the data above are averages for the term (Using the values at the end of the previous and current terms, and therefore the data listed in the official earnings announcement filings and the data above do not necessarily coincide because they use term end equity ratio).
Fiscal Year March 2016 Earnings Results
Sales, Operating Income Rise 0.2%, 5.2% Year-On-Year
Sales rose by 0.2% year-on-year to ¥117.278 billion. A decline in the brass bar manufacturing business sales due to a decline in copper market and drop of sales in other business sales due to the sale of the subsidiary which operated fitness clubs in the previous year were offset by an increase in sales of the valve manufacturing business. In the valve manufacturing business, overseas sales rose by 5.9% year-on-year due to strong demand in Asia, especially in ASEAN and China, recovery in the North America, and the depreciation of the yen against the US dollar. Domestic sales also rose by 2.5% year-on-year due to strong sales for semiconductor manufacturing facilities and water works facilities despite inventory adjustment at distributor levels for the use in building facilities.

Cost reduction and lower material cost in the valve manufacturing business improved the operating income ratio by 1.3% points. Operating profit increased by 5.2% year-on-year to ¥7.245 billion despite an increase in sales, general and administrative expenses such as M&A expenditure, R&D expense and SG&A expense from overseas subsidiaries due to the weaker yen. Net income decreased by 28.6% year-on-year to ¥4.915 billion due to lower foreign exchange translation gains (Decline from ¥401 to ¥82 million) and lower extraordinary income due to the disappearance of the profit recorded from sale of the subsidiary that operated fitness clubs (¥2.156 billion) in the previous year.
Valve Manufacturing Business
Sales rose by 3.8% year-on-year to ¥93.579 billion, on the back of domestic sales growth of 2.5% year-on-year to ¥57.424 billion. Sales for the main products for building facilities grew by 2.0% year-on-year. Growth was not as strong as initially anticipated due to inventory adjustments at the distributor level. However, the growth improved during the end of the fiscal year as inventory adjustments were made. Sales for water work facilities grew by 6% year-on-year. Although weak demand was seen during the fourth quarter due to seasonal factors, favorable trends continued for earthquake resistant products and sales for the full fiscal year exceeded the previous term. At the same time, sales trends of stainless steel industrial use valves used in machinery equipment, chemical, food, paper and other industry applications remained unchanged as there were no significant changes in market environment. Given the favorable first half, sales to the semiconductor industry grew year-on-year despite a slowing in the second half.

Overseas sales rose by 5.9% year-on-year to ¥36.154 billion. Sales in Asia grew by 12% year-on-year with strong demand from ASEAN and China. The North America market also saw growth of 6% year-on-year. Depreciation of the yen against the US dollar also contributed to profits. On the other hand, sales in Europe and other regions declined by 17% year-on-year as capital expenditure of energy related companies decreased due to significant drop in crude oil price.

Operating income rose by 9.2% year-on-year to ¥10.384 billion. Increases in sales, general and administrative expenses of overseas subsidiaries due to the weaker yen, and increases in M&A related and research and development expenses were absorbed by cost reduction, volume discounts and a fall in material costs.
Brass Bar Manufacturing Business
In fiscal year 2015, the brass bar market in Japan decreased by 3.2% year-on-year to 14,866 tons per month. Electric copper prices continued to decline from May 2015 until the end of the year, although they recovered slightly at the beginning of 2016. Despite the consolidation of Hokuto Giken Kogyo Co., Ltd. in July 2015, sales declined by 2.2% year-on-year to ¥20.557 billion due to a drop in the selling price of brass rods and bars arising from copper market trends. The decline in selling price and increase in depreciation due to the expansion of processing plant led to an operating loss of ¥16 million (Compared to operating income of ¥248 million in the previous year).
Other Business
Sales and operating income declined by 46.4% and 67.6% year-on-year to ¥3.141 billion and ¥75 million respectively. The sale of KITZ Wellness in October 2014 was a major factor behind these declines (Influence of about ¥2.7 billion in sales). The hotel business saw a 1.9% year-on-year increase in sales to ¥3.050 billion and a 30.2% decline in operating income to ¥30 million.
Total assets rose by ¥3.632 billion from the end of the previous fiscal year to ¥119.422 billion at the end of the current first year from an increase in capital expenditure and M&A in both Japan and overseas markets. Tangible and intangible assets both increased while net asset and interest bearing liabilities increased due to the issuance of ¥10.0 billion corporate bonds. Equity ratio declined by 1.3% points from the end of the previous fiscal year to 62.9%.
The net inflow of operating cash flow exceeded the previous term and rose to ¥9.592 billion in the current term from an improvement in capital efficiency. A net outflow of investing cash flow of ¥9.763 billion was recorded. A net inflow of financing cash flow of ¥796 million was recorded due to the issuance of corporate bonds.
(4) Shareholder Returns
Year-end dividend of ¥7 per share is expected to be paid, for a combined full year dividend of ¥13 per share (consolidated dividend payout ratio of 28.6%), along with the interim dividends of ¥6. Comprehensive shareholder return totaled ¥1.909 billion including ¥509 million in stock buyback implemented during the term for a comprehensive payout ratio of 38.8%.
Fiscal Year March 2017 Earnings Estimates
Operating Income Expected to Rise 10.4% Year-on-Year despite a 4.9% Year-on-Year Decline in Sales
Estimates call for sales to decline by 4.9% year-on-year to ¥111.5 billion in fiscal year March 2017. This estimate is based on the assumption of weak overseas demand in the valve manufacturing segment, the negative impact of stronger yen, and a sales decline in the brass bar manufacturing segment caused by continuation of weak copper market. At the same time, estimates call for operating income to rise by 10.4% year-on-year to ¥8.0 billion. Profitability of the valve manufacturing segment is expected to recover through the stronger yen, declines in material costs and effective cost reductions. Productivity improvements and restructuring are expected to allow the brass bar manufacturing segment to absorb the negative influence from weak copper market.

Foreign exchange rate assumptions are as follows: ¥/$=¥110 (¥121.04 in FY3/16), ¥/Euro=¥125 (¥133.66 in FY3/16)
In the valve manufacturing business, sales are expected to grow on a volume basis. However, unfavorable foreign exchange rates are expected to contribute to a decline in sales of ¥2.5 billion. In the domestic market, sales to semiconductor manufacturing facilities applications are expected to decline year-on-year, while favorable trends are expected for other applications. A 4% year-on-year decline is expected in overseas sales due to weak demand in Asia, the Americas (including the sales of Brazilian subsidiary (¥1.9 billion) which was consolidated in FY3/16) and Europe. On the other hand, profitability is expected to improve through cost reductions, the fall in material prices and volume discounts.
The brass bar manufacturing segment expects a surplus despite a decline in sales due to weak copper market.
(2) Shareholder Returns
A dividend of ¥6 per share in the first half, and ¥7 per share in the second half are expected to be paid, bringing the full year dividend payment to ¥13 per share. KITZ Corporation considers a dividend payout ratio target of 25% to be appropriate, and sought to achieve a comprehensive payout ratio of about 33% including direct payment and stock buybacks. However, it endeavors to further enhance the consolidated payout ratio through aggressive stock buybacks.
The Medium Term Business Plan
KITZ Corporation's Long Term Business Plan (from fiscal years March 2011 to 2021) called "KITZ Global Vision 2020" calls for achievements to be made in fiscal year 2020 (FY3/21), which marks the Company's 70th anniversary. To help achieve the Long Term Business Plan smoothly, KITZ has also implemented a three-year Medium Term Business Plan. The First Medium Term Business Plan (FY3/11 to FY3/13) and the Second Medium Term Business Plan (FY3/14 to FY3/16) have been completed, and the Third Medium Term Business Plan (FY3/17 to FY3/19) starts from fiscal year March 2017.

The global economic environment is changing rapidly due to an economic deceleration in China, its negative influences on other emerging economies, and capex restraints by energy-related companies from a drop in the crude oil prices. Domestic companies also restrained capital investments as uncertainty over the global economy lingers. However, a certain level of demand in building facilities is expected to be derived from the Tokyo Olympics and Paralympic games in 2020. In light of these difficult conditions, KITZ Corporation formulated the Third Medium Term Business Plan and revised its Long Term Business Plan.
Sales estimates could not reach the Second Medium Term Business Plan due to a slower than anticipated recovery in demand for both the valve manufacturing and the brass bar manufacturing segments, and the negative effect of the sale of the subsidiary which operated fitness clubs. Although growth in profits was recorded in the valve manufacturing business segment through cost reductions, overall sales growth was weak and profits were lower than expected.
The project management division contributed to an improvement in profitability of industrial valves (for Large projects) through an integration of "design", "operation", and "maintenance", which was a concern in the First Medium Term Business Plan. However, profits fell short of plans because of sluggish sales on the back of economic slowdown in China and the drop in crude oil prices even though profitability improved. Profit margins continued to worsen especially for commercial valves. Further cost reductions are needed to compete with its peers as KITZ Corporation's prices are not competitive enough. KITZ Corporation also implemented measures such as a restructuring of its profit structure, strengthening of overseas sales, investing in growth realms, and business expansion through M&A and strategic alliances.
While collaboration between marketing and sales, and engineering were strengthened, new product sales fell below plans (Sales promoting strategy needs to be improved while introduction of new products needs to be accelerated). Sales promotion of packaged deals including alliance products were not promoted strongly enough. As M&A transactions were made mostly in the latter part of the Second Medium Term Business Plan, achievement within the three years were minimal.
The market for brass bar contracted and measures implemented to secure profits were not adequate. Profit maximization will be pursued by improving productivity and accelerating marketing of high value added processed goods.
After the sale of KITZ Wellness Co., Ltd. in October 2014, the main business of this segment became the operation of Hotel Beniya alone. Hotel Beniya went through a major renovation in fiscal year 2014. However, promotions and campaigns implemented to attract customers after the renovations and improve customer spending were not as successful as planned.
<Third Medium Term Business Plan>
(1) Outlook by region
Japan Gradual economy recovery is expected on the back of strong corporate performance and improvement in the employment conditions
Americas Market environment of downstream in Oil & Gas industry where KITZ Corporation has strengths is not weaker than upstream.
Europe Big growth is predicted to be difficult due to weak capital investments.
ASEAN Lackluster economies of recourse-rich Indonesia, in which KITZ has a large presence, would affect overall sales in the region
China The economy continues to stagnate due to excess capacity and lower investments. Only a limited amount of investment projects for buildings and factory noted.
Projects New projects slowed due to sluggish prices. Enhanced competitiveness is needed to secure more orders. LNG-related projects continue to expand.
Foreign exchange rate assumptions are as follows: ¥/$=¥110 (in FY3/17 and FY3/18), ¥/$=¥115 (in FY3/19)
(2) Basic Policy
1. Aim for achieving 10 billion yen or more of the operating profit in the fiscal 2018 and the record-high profit in the fiscal 2020
FY2018 Consolidated Operating Profit : 10 billionYen
FY2020 Consolidated Operating Profit : 12.5 billionYen (Top record FY2007 : 11.6 billionYen)
2. Aim for thorough implementation of the profit/cash flow-oriented policy and 8% or more of ROE
Cost improvement by global procurement, self-manufacture, and improvement of productivity
Actively make capital expenditure which make profit
3. Concentrate management resources in the focused market fields and areas where we can make use of our advantages
the focused market fields to building facility, petrochemistry and general chemistry, and clean energy (hydrogen and LNG)
concentrate product development and investment of facilities into focused markets
By enhancement of function and authority for organizational integration to thorough management of important strategy for existing organization and following PDCA cycle
4. Increase shareholders' Value
target payout ratio 25%
Proactively acquiring treasury stock to increase shareholders' value
Valve Manufacturing BusinessThree Strategic Pillars

① Narrowing down of the focused market fields and focused areas
Narrow down the focused market fields to building facility, petrochemistry and general chemistry, and clean energy (hydrogen and LNG) and move forward with the introduction of new specialized products to dig the market deeply and try to expand our market share. Also narrow down the focused areas to Japan + 3 Regional HQs (Europe/The Americas/ASEAN), two hub markets (China and India) and reinforce their multifunctionalization: Sales, Marketing, Engineering, Stock, Maintenance and Service. Especially, accelerate multifunctionalization in ASEAN and The Americas.
② The Matrix structure with vertical (organizations by functions) and horizontal (company-wide horizontally-based organization) by which we implement business strategy with enhancement of management of both "organization" and "product".
By enhancement of function and authority of Business Planning Dept. , try to thorough management of important measures for existing organization and following PDCA cycle. Newly establish the Product Management Center, comprehensively introduce the product group based on the strategy in a timely/expeditious manner, and implement the product management. Try to expand the sales and share in the focused market fields and take responsibility for achievement (figures).
③ Realization of the cost to be able to compete globally by utilizing existing resources with economy and thoroughly to expand sales and profit.
Enhance the cost improvement promotion system as anchored by the Production Head Office. Put effort into global procurement, self-manufacture, and improvement of productivity. Newly establish the Engineering Center in which estimation/design work is aggregated within the Engineering Head Office and try to improve profitability of the special order products.
Brass Bar Manufacturing Business
KITZ Corporation aims to maximize profits by improvement of productivity and expansion of value added products by restructuring. In the former, KITZ Corporation intends to lower manufacturing cost by reorganization of production lines and decrease material costs by optimal blending of materials, while it aims to achieve the latter by integrating cutting and forging productions of KITZ group and business expansion by creating integration effect.
Water Business
KTIZ Corporation aims to cultivate KITZ Smart Aquaculture and water processing technology business. While KITZ Smart Aquaculture is a new business that responds to demands of fisheries business that are experiencing declining natural recourses, the water processing technology business responds to strong global demand for clean water and higher environmental awareness through collaboration of Group companies Toyo Valve, Shimizu Alloy Manufacturing, KITZ Micro Filter Corporation and others.
KITZ Corporation expects to achieve annual sales of ¥250 million in fiscal year March 2017, ¥250 million in fiscal year March 2018, ¥500 million in fiscal year March 2019 and ¥1.0 billion in fiscal year March 2021 in "KTIZ Smart Aquaculture" business.
(3) Strengthening Business Foundation
Human Resources Management
Promotion of active participation by women; introduction and formulation of evaluation systems that respond to diversified talents; and introduction of consolidated database that enables the Company to assign the right people in the right position.
Strengthening of environmental management systems; decreasing environmental stress; and responding to environmental laws.
Quality Control
Ensuring the quality of products continues to satisfy customers.
Corporate Governance and Internal Control
Implementing solid and transparent management in accordance with the Corporate Governance Code,
Building a structure that supports appropriate investments in decision-making processes.
Building an internal control system that evaluates newly added companies through M&A.
Accounting, Finance
Enhancement of capital for possible M&A deals; and improvement of ROE through dividend policy including stock buybacks.
Information Systems
Establishment of global information system that enables business optimization, and support business decisions.
Contribution to Society
As a part of CSR management, encourage engagement and continuous participation in social contributions activities.
Total assets are expected to decrease by ¥2.8 billion from the end of the fiscal year March 2016 due to increases in working capital efficiency. However, tangible and intangible assets are expected to rise by ¥14.1 billion from the end of the fiscal year March 2016 on the back of strategic investment in the focused business areas. Interest bearing liabilities are expected to increase by ¥3.0 billion from the end of the fiscal year March 2016 to ¥28.0 billion at the end of fiscal year March 2019.
<"KITZ Global Vision 2020", Long-Term Business Plan>
For the reasons cited below, KITZ Corporation acknowledges the difficulties of realizing its optimistic earnings trends, and it has revised its "KITZ Global Vision 2020" Long-term Business Plan accordingly.
(1). Economic deceleration in China since 2012 not only led to slower demand in China, but also led to stagnant economies around the world, price declines, intensified pricing competition as a result of cheap exports from China and surplus production capacity.
(2). While energy related companies restrained capital investments due to the sudden drop in crude oil prices since the second half of 2014, they seek discounts on raw materials from suppliers to secure profits.
(3). Domestic companies are refraining from making more capital investments due to lower expectations of their earnings caused by stagnant global economy. However, there is a certain level of demand expected from construction of facilities for the Tokyo Olympics and Paralympic games. Companies that have moved their factories outside of Japan are also finding it difficult to derive benefits from the depreciation of yen.
* In additions to the estimates above, KITZ included estimates of ordinary income (¥12.2 billion), net income attributable to parent company shareholders (¥8.0 billion), EPS (¥81.0 per share) and BPS (¥938.0 per share) in its revised Long Term Business Plan.
Having reviewed the results of the Second Medium Term Business Plan and the harsh business environments both in Japan and overseas, KITZ Corporation created the Third Medium Term Business Plan, and revised the "KITZ Global Vision 2020", Long Term Business Plan. In these business plans, KITZ Corporation places more emphasis upon profits than sales growth, and cost reductions of ¥5.0 billion are expected to be achieved mainly in the valve manufacturing business within the period of the Third Medium Term Business Plan. In addition, product consolidation and communization of parts are also anticipated. KITZ Corporation estimates sales growth of 2% to 3%, and it seeks to achieve further growth through M&A and alliance for products. By geographic region, KITZ Corporation aims to strengthen multiple functions in ASEAN and North American headquarters through reorganization and integration.

In February 2016, KITZ Corporation formed capital and business alliances with TOA Valve Engineering Inc. (TSE 2nd section), the leading valve manufacturer in the realm of electricity and power generation, on the back of cutting edge technologies of high temperature and high pressure service valves with high reliability. KITZ Corporation purchased all of the shares owned by Mitsubishi Corporation. The transaction made KITZ Corporation the largest shareholder with 11.28% of total shares outstanding (12.98% of voting right). The strength that TOA Valve Engineering Inc. has in the field of high temperature and high pressure service valves will be combined with KITZ Corporation's global network of procurement, production and sales to complement and benefit both companies. Along with the KTIZ Smart Aquaculture project in the water business, this business is expected to see strong growth.
<Reference: Corporate Governance>
◎ Corporate Governance Report
KITZ Corporation has submitted a Corporate Governance Report on October 14, 2015 after the Corporate Governance Code came into effect (in June 2015).
This report is intended solely for information purposes, and is not intended as a solicitation to invest in the shares of this company. The information and opinions contained within this report are based on data made publicly available by the Company, and comes from sources that we judge to be reliable. However we cannot guarantee the accuracy or completeness of the data. This report is not a guarantee of the accuracy, completeness or validity of said information and or opinions, nor do we bear any responsibility for the same. All rights pertaining to this report belong to Investment Bridge Co., Ltd., which may change the contents thereof at any time without prior notice. All investment decisions are the responsibility of the individual and should be made only after proper consideration.
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