[Company analysis] Toray Industries, Inc. (東レ)

「Toray Industries, Inc. (東レ)」 was an textile company at the time of its inception, but is now a chemical company dealing in chemical products and information-related materials such as synthetic fibers and synthetic resins. It is also one of the core companies of the「Mitsui Group」. "Ray" in "Toray" means "rayon" even now, they no longer produce rayon at all. The number of consolidated employees is about 45,881.

 

1. Company Profile

2. Summary and Features

3. Major Business

4. Financial Information

 

 

 

1. Company Profile

 

※Unit is JPY million, as of 2019

Company name	Toray Industries, Inc.
Company name (Japanese)	東レ
Date of establishment	January 1926
Headquarters location	大阪府大阪市北区中之島三丁目3番3号 中之島三井ビルディング
Capital	147,873
Consolidated sales	2,388,848
Consolidated operating profit	141,469
Consolidated total assets	2,788,351
Consolidated capital	1,213,944
Capital adequacy ratio	43.5%
Consolidated number of employees	48,320

 

 

 

2. Summary and Features

 
Originally, synthetic fibers were in the stage of commercialization from the 19th century, and the demand for fibers was huge. In Japan, in 1918, 「Teijin Ltd.(帝人)」was established to handle rayon, Japan's first artificial silk thread. And「Mitsui & Co., Ltd.(三井物産)」 also felt the opportunity, and in 1926, they established「Toyo Rayon」who is predecessor of「Toray」.

After the end of World War II,「Toray」introduced the synthetic technology of nylon, a synthetic fiber, from「DuPont」 in the United States in 1951. As a result, they has achieved tremendous growth, and even forced their competitor, 「Teijin」into the crisis of bankruptcy. In 1958, 「Toray」and「Teijin」started  the production of Tetoron, a polyester fiber, began to grow again.

 

Since then, they have succeeded in developing hit products not only in the existing textile division but also in various fields such as artificial leather, carbon fiber used for tennis rackets, chemical fiber that does not generate static electricity, and household water purifiers. Even when other textile companies were desperate for business diversification following the pursuit of textile companies in Asian countries,「Toray」alone has an overwhelming performance based on the above high value-added products.

 

Currently, the textile business accounts for about 40% of Toray's sales. The remaining 60% comes from business areas such as plastics, chemicals and information and communications equipment materials. In this way, it is no exaggeration to say that Toray's strength is its business creation power that creates new businesses through R & D.

Actually,「Toray」started later than other textile companies, and was just a "market follower" at the time of its founding. But now, they called「Toray」as a  "Market Changer" that offers a series of products that other companies didn't even come to mind. It is said that This company has done this owing to the Toray's own attitude toward human resource development. They normally spends at least ¥ 100,000 a year on educating one employee, which is likely to lead to Toray's business creation.

 

 

 

3. Major Business

 

■ Textile business
「Toray」supports a wide range of products, from raw yarns and cotton for clothing and textiles to textiles for industrial materials.

■ Functional chemical products
They also develop businesses related to materials such as resin chemistry and films for organic EL, automotive resins, and lithium batteries.

■ Carbon fiber and composite materials business
This company is one of the world's largest PAN-based carbon fiber manufacturers and operates aerospace, energy and sports carbon fiber businesses.

■ Environmental Engineering Products Business
They are engaged in seawater desalination systems, environment-related equipment, plant engineering, housing and construction-related businesses.

■ Life science business
They are focusing on medical equipment (artificial kidney), bio equipment (DNA chip) and pharmaceutical business.

 

 

 

4. Financial information

 

※Unit is JPY million

		2016	2017	2018
Consolidated sales		2,026,470	2,204,858	2,388,848
Consolidated operating profit		146,893	156,464	141,469
Consolidated total assets		2,396,785	2,592,914	2,788,351
Consolidated net assets		1,100,176	1,169,188	1,213,944
Breakdown of sales	Textile business	856,124	913,610	974,265
	Functional chemical products	724,648	803,310	868,847
	Carbon fiber and composite materials	161,608	177,949	215,913
	Environmental Engineering Products	212,548	238,256	257,673
	Life science business	54,150	53,803	53,653
	Others	17,392	17,930	18,497