[Company analysis] Sumitomo Heavy Industries, Ltd. (住友重機械工業)

「Sumitomo Heavy Industries, Ltd. (住友重機械工業)」is one of Japan's leading heavy machinery companies in the field of advanced mechatronics such as shipbuilding, various manufacturing equipment, and precision machinery. Now, based on their business diversification strategy, they are also supporting precision machinery for medical treatment and semiconductors, too. And this company is also a member of the「Sumitomo Group」. The number of consolidated employees is approximately 22,543.

 

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	Sumitomo Heavy Industries, Ltd.
Company name (Japanese)	住友重機械工業
Date of establishment	November 20, 1888
Headquarters location	〒141-6025 東京都品川区大崎2丁目1番1号
Capital	30,872
Consolidated sales	903,051
Consolidated operating profit	75,244
Consolidated total assets	954,051
Consolidated capital	465,001
Capital adequacy ratio	48.7%
Consolidated number of employees	22,543

 

 

 

2. Summary and Features

 
「Sumitomo Heavy Industries」was established in 1888. The purpose was to help development of Besshi Copper Mine which was operated by「Sumitomo Metal Mining Co., Ltd.(住友金属鉱山)」, by conducting manufacturing and repair of machines. This is similar origin with「Sumitomo Electric Industries, Ltd.,(住友電気工業)」. About 50 years later, in 1934, the company merged with「Sumitomo Machinery Co., Ltd.(住友機械)」 and began manufacturing steel and industrial transportation machinery. In 1969, they merged with「Uraga Heavy Industries Co., Ltd.(浦賀重工業)」.

The main business of this company was manufacturin products for heavy industry, such as large cranes, construction excavators, and ships, which are suitable for the company's name, "Heavy Machinery." Now,「Sumitomo Heavy Industries」are implementing a business diversification strategy, so they started business in the field of medical equipment, semiconductor manufacturing equipment and precision machinery. They also carry out tanker business, especially in 1979, they built a super large tanker(ULCC).

In the field of new business such as advanced medical equipment, this company has competitive advantages in mechanical, electrical, and control technologies. Currently,「Sumitomo Heavy Industries」has 72 affiliated companies in 29 countries and regions, mainly in Asia and Europe. In addition, the demand for construction business in Japan has increased in recent years, so their business performance also have improved significantly due to an increase in construction project in Japan.

 

 

 

3. Major Business

 

■ Machine parts
The main product is a variable speed reducer motor that adjusts the torque by making full use of the rotation speed of the motor. It is mainly used for the drive parts of industrial robots and「Sumitomo Heavy Industries」has the top share in the world.

■ Precision machine
They can handle equipment such as plastic injection molding machines, semiconductor manufacturing equipment, laser processing machines, cryogenic refrigerators, and precision positioning devices.

■ Construction machinery
They can handle construction machinery such as shovel cars. 

■ Industrial machine
They also manufacture industrial machines such as accelerators, medical machines, forging presses, and continuous unloaders. In particular,「Sumitomo Heavy Industries」has the top share in Japan for consecutive unloaders.

■ Ship
Mainly specializes in medium tankers.

■ Environment / Plant
They handle in-house power generation facilities, air pollution control devices, water treatment devices, etc. In particular,「Sumitomo Heavy Industries」has the world's top share in the circulating fluidized bed boiler power plant (CFB) field, which can support various fuels such as biomass.

 

 

 

4. Financial information

 

※Unit is JPY million

		2016	2017	2018
Consolidated sales		674,328	791,025	903,051
Consolidated operating profit		48,431	69,921	75,244
Consolidated total assets		796,484	895,569	954,051
Consolidated net assets		409,171	444,964	465,001
Breakdown of sales	Machine parts business	98,648	109,396	133,426
	Precision machine business	145,745	169,405	185,698
	Constructiuon machinery business	182,504	260,457	290,472
	Industrial machine business	98,913	83,790	93,737
	Shipbuilding business	32,611	38,291	41,443
	Environment / Plant business	107,613	121,885	150,951
	Others	8,294	7,801	7,335