[Company analysis] Denki Kagaku Kogyo K.K. (デンカ)

「Denki Kagaku Kogyo K.K. (デンカ)」 is a general chemical company in Japan, dealing with organic and inorganic chemicals, cement, special cement additives, electronic components transportation materials and food packaging materials. The old company name was「Denki Kagaku Kogyo Kabushiki Kaisha(電気化学工業株式会社)」which was established in 1915. "Denka"is an acronym for the "Denki Kagaku Kogyo K.K".The number of consolidated employees is about 6,133.

 

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	Denki Kagaku Kogyo K.K.
Company name (Japanese)	デンカ
Date of establishment	May 1, 1915
Headquarters location	〒103-8338 東京都中央区日本橋室町二丁目1番1号（日本橋三井タワー）
Capital	36,998
Consolidated sales	413,128
Consolidated operating profit	34,228
Consolidated total assets	483,827
Consolidated capital	250,481
Capital adequacy ratio	51.8%
Consolidated number of employees	6,133

 

 

 

2. Summary and Features

 
The origin of「Denka」is 「Hokkai Carbide(北海カーバイド工場)」, a carbide manufacturing company established in Hokkaido in 1912 by Fujiyama Tsuneichi(藤山常一). At that time, the main business of this「Hokkai Carbide」was to manufacture and sell lime nitrogen that can be used as fertilizer from carbide. In 1913, with the help of Mitsui affiliated capitalists, it changed to the current form of「Denki Kagaku Kogyo Kabushiki Kaisha」.

At present,「Denka」is a comprehensive chemical company that conducts business in various fields, from raw materials for the inorganic and organic industries to civil engineering, building materials, electronic materials, food packaging materials, and medical diagnostics. For daily necessities, they produce the flu diagnostic kit. And they also provides the"chlorochloroprene" used for automobile parts and materials used for liquid screens of smartphones and PCs. Especially, 「Denka」has No.1 global market share in “chloroprene rubber”.

The company also owns a limestone mine, which is said to be one of the characteristics of「Denka」. The limestone mine has huge reserves, so that it can be mined for the next 1,000 years. They also develops various high value-added products using the abundant resources obtained from this limestone mine as raw materials. Carbide, which has been in business for 100 years since its foundation, is one of them.

In particular, 90% of the carbide produced in Japan is made of「Denka」. There is also a unique policy of procuring electricity used in-house. At present, the company owns a total of 210,000 kW of power generation, including hydro, solar and thermal power plants, thereby producing products at a lower cost than the competition.

Like many Japanese chemical companies, This company is also aiming to diversify its business, including elastomers and functional resins(for the production of automobiles and home appliances), and infrastructure-related materials(such as cement and special admixtures for concrete), Electronic equipment components(functional ceramics, electronic circuit boards), life and environmental products(industrial tapes, food packaging materials), and pharmaceuticals(vaccines and test reagents). In the 2000s, the company has been actively expanding overseas, by establishing several subsidiaries in Korea and China.

 

 

 

3. Major Business

 

■ Elastomers and functional resins
Chloroprene rubber, acetylene black, styrene synthetic resin, styrene monomer, acetyl chemical

■ Infrastructure / Social Solutions
Special admixtures for cement and concrete, fertilizers, inorganic materials, resin processed products for civil engineering and agriculture

■ Electronics and Advanced Products
Packaging materials for electronic parts, functional ceramics, electronic circuit boards, heat dissipation materials, adhesives, acetylene black, etc.

■ Life and Environmental Products
Architectural and industrial resin processed products, food packaging materials, etc.

■ Life Innovation business
Pharmaceuticals, etc.

 

 

 

4. Financial information

 

※Unit is JPY million

		2016	2017	2018
Consolidated sales		362,647	395,629	413,128
Consolidated operating profit		25,844	33,652	34,228
Consolidated total assets		454,944	475,086	483,827
Consolidated net assets		227,487	242,780	250,481
Breakdown of sales	Elastomers and functional resins	151,705	178,444	179,237
	Infrastructure / Social Solutions	51,816	53,146	54,846
	Electronics and Advanced Products	46,252	54,279	67,113
	Life and Environmental Products	41,188	40,980	39,034
	Life Innovation business	34,021	32,338	34,104
	Others	37,662	36,439	38,791