[Company analysis] Mitsui & Co., Ltd. (三井物産)

「Mitsui & Co., Ltd. (三井物産)」is the leading general trading company of the「Mitsui Group」and it has the longest history as a general trading company in Japan. In addition, this company is included in the five largest Japanese trading companies(「Mitsubishi Corporation(三菱商事)」,「Sumitomo Corporation(住友商事)」,「Mitsui & Co., Ltd.(三井物産)」,「Itochu Corporation(伊藤忠商事)」and「Marubeni Corporation(丸紅)」) . The number of consolidated employees is approximately 43,993.

 

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	Mitsui & Co., Ltd.
Company name (Japanese)	三井物産
Date of establishment	Friday, July 25, 1947
Headquarters location	〒100-8631 東京都千代田区丸の内一丁目1番3号
Capital	341,775
Consolidated sales	6,957,524
Consolidated operating profit	584,338
Consolidated total assets	11,945,779
Consolidated capital	4,530,308
Capital adequacy ratio	37.9%
Consolidated number of employees	43,993

 

 

 

2. Summary and Features

 
「Mitsui & Co.」is Japan's first general trading company. In fact, the time when this company was founded, there was terms or notions like "trading company" did not exist. From the early stage of Meiji period,「Mitsui & Co.」has been trading various products as a private company, with a business structure that was unprecedented in the world. And their business structure became the origin of "general trading company".

In the Meiji era, there was a Cliché about overseas expansion of Japanese companies. First,「Mitsui & Co.」enter the country. Second,「Nippon Yusen」established the trading route. And last, 「Yokohama Specie Bank(横浜正金銀行)」open their branch. Mitsui's overseas market expansion strategy was so adventurous, that even Japanese diplomats said this. "There is no Japanese embassy but still Mitsui is there."

After the end of the war, 「Mitsui & Co.」 was targeted for zaibatsu dismantling by GHQ. but in February 1959, past Mitsui's affiliated companies had gathered and the current「Mitsui Bussan」was established. As a result,「Mitsui & Co.」regained its position as Japan's largest general trading company. However, due to the failure of "Iran Japan Petrochemical (IJPC) investment", this company lost its solid position, and was surpassed by「Mitsubishi Corporation」.

However, there are many companies that were established by former employee of「Mitsui & Co.」. For example, 「Dainippon Beer Company(大日本麦酒株式会社)」, which is the origin of「Asahi Breweries, Ltd.(アサヒグループホールディングス)」and「Sapporo Holdings(サッポロホールディングス)」, and「Taisho Kaijo Kasai Hoken Kabushiki Kaisha(大正海上火災保険)」which is current「MS&AD Insurance Group, Inc.(MS&ADインシュアランスグループホールディングス)」, and「Toray Industries, Inc.(東レ)」. So, compared with Mitsubishi's nickname "Mitsubishi the Organization(組織の三菱)" and Sumitomo's nickname "Sumitomo the Unity(結束の住友)", Mitsui is sometime called"Mitsui the Talant(人の三井)".

 

「Mitsui & Co.」 is currently engaged in trading and business investment in various fields such as metals, resources, machinery and infrastructure, in approximately 66 countries around the world. This company has advantage in resources and energy. Especially, their resource reserve is so huge so that it is comparable to「Mitsubishi Corporation」's resource reserve, which is Japan's largest general trading company. Another characteristic is, in Japan, they have the top share in the food products import such as corn, beans, and flour for milling.

Considering the fact that resource business has large part of total sales, the sales of「Mitsui & Co.」tends to be easily affected by the market situation of specific resources. In order to overcome this disadvantage, this company are actively conducting business diversification. For example, in 2016, they purchased 22% stock share of healthcare business of「Panasonic Corporation(パナソニック)」and added the medical business to its portfolio.

 

 

 

3. Major Business

 

■ Energy business
They are engaged in the mining and development of resources such as oil, natural gas and nuclear materials, as well as the trade of oil, petroleum products and coal. They are also promoting a new energy business. This field accounts for about 50% of total sales and net income.

■ Metal business
They procure, supply and sell various iron ore, coal, copper, nickel and steel products. It accounts for about 1/4 of all sales and profits.

■ Chemicals business
They are developing business in the fields of functional materials (synthetic rubber, carbon fiber, etc.), advanced materials (liquid crystal displays, semiconductor materials), specialty chemicals (green bio raw materials, detergent raw materials, and surfactants.

■ Machine / Infrastructure business 
They carry out sales, leasing, financing and investment for large-scale plants, ships, aircraft, automobiles and other heavy equipment.

■ Lifestyle business
They carry out food, retail, health management, fashion and real estate related businesses. 「Mitsui & Co.」has Japanese top class food import business about corn, beans and flour for milling. In the convenience store business, they cooperate with「Seven Eleven Japan」.  

■ Information and corporate development business
They are implementing various businesses related to information technology such as ICT-based businesses, high-speed communications businesses, IoT, data centers, finance, and logistics.

 

 

 

4. Financial information

 

※Unit is JPY million

		2016	2017	2018
Consolidated sales		4,363,969	4,892,149	6,957,524
Consolidated operating profit		460,791	544,384	584,338
Consolidated total assets		11,501,013	11,306,660	11,945,779
Consolidated net assets		3,990,162	4,218,123	4,530,308
Breakdown of sales	Steel products business	202,406	238,240	247,383
	Metal resource business	746,406	946,369	1,055,801
	Machine・Infrastrictire business	408,504	447,088	904,641
	Chemicals business	1,037,284	1,186,673	1,747,400
	Energy business	463,601	534,293	707,978
	Lifestyle business	1,378,263	1,409,378	2,125,847
	Next generation business	125,226	127,326	163,418
	Others	1,908	1,937	5,056
	Adjustments	371	845	0