Nakayama Steel Works, Ltd.
5408・Prime Market・Iron & Steel
Steel
Nakayama Steel Works' core segment. Responsible for the manufacturing and sale of Primary Steel Products (Crude Steel & Rolled Steel) and Secondary Processed Steel Products via electric furnaces.
| Period | Current | Previous | Change |
|---|---|---|---|
| Net sales (segment total, including internal sales) | ¥145,860 million | ¥166,647 million | ↓ |
| Net sales to external customers | ¥145,669 million | ¥166,486 million | ↓ |
| Ordinary income (segment income) | ¥4,215 million | ¥7,824 million | ↓ |
| Segment assets | ¥136,564 million | ¥134,237 million | ↑ |
| Depreciation | ¥2,766 million | ¥2,615 million | ↑ |
| Increase in property, plant and equipment and intangible assets | ¥4,970 million | ¥3,838 million | ↑ |
Business Details
The Steel segment accounts for approximately 98% of the Group's net sales and is the core business. It manufactures and sells crude steel, rolled steel materials, and processed steel materials using electric furnaces, supplying the domestic construction and manufacturing industries. Consolidated subsidiaries Sansen Shear Co., Ltd. (secondary processing), Sansei Kaiun Co., Ltd. (transportation), and Nakayama Tsusho Co., Ltd. / Sansei Shoji Co., Ltd. (sales) form the value chain. In FY2026 (ending March 2026), the shutdown of electric furnace operations due to a substation accident (September 26, 2025 to December 24, 2025) placed significant pressure on performance.
Recent Overview
The shutdown of electric furnace operations due to a substation accident dealt a direct blow, resulting in a sharp 46.1% year-on-year decline in ordinary income.
A fifth substation accident occurred on September 26, 2025, halting electric furnace operations. Production volume fell sharply to approximately 60% of the prior year's level, resulting in approximately ¥1,600 million in costs from external iron source procurement costs, equipment restoration expenses, and deteriorated unit costs (an extraordinary loss of ¥843 million was recorded). Following the resumption of operations on December 24, operations have continued smoothly. In addition, effective April 1, 2026, a joint venture, NN Seiko LLC, was established with Nippon Steel Corporation, and the new electric furnace construction plan has moved into full swing. A basic agreement on business collaboration was also concluded with Yodogawa Steel Works Co., Ltd., and discussions are underway to expand the application of electric furnace steel products.
Key Products
Growth Drivers
- Enhanced production capacity through new electric furnace investment (the joint venture with Nippon Steel, "NN Seiko LLC," was established on April 1, 2026)
- Continued stable production and securing of spreads following the resumption of electric furnace operations (December 24, 2025)
- Expanded application of electric furnace steel products and improved sales volume and selling prices through business collaboration with Yodogawa Steel Works Co., Ltd.
- Improved selling prices and sales volume through utilization of a newly established relay location in the Kanto region
- Expected increase in demand for electric furnace steel (CO2 emissions approximately 1/4 of blast furnace steel) amid growing carbon neutrality demand
- Strengthened business foundation through expanded sales of high-value-added products and enhanced processing capacity
Risks
- Continued downward pressure on steel materials selling prices due to the ongoing inflow of inexpensive imported materials from China
- Sluggish domestic demand for construction (delays and scale-backs of projects due to rising material costs and labor shortages) and the impact of U.S. tariffs on manufacturing-related demand
- Increased costs due to iron scrap prices remaining at elevated levels and spiking sharply (a sharp surge occurred in the latter half of the second half)
- Risk of rising energy prices due to the impact of Middle East tensions
- Risk of operational shutdown due to equipment trouble at electric furnaces and substations (the September 2025 substation accident is a precedent; accident-related losses of ¥843 million were recorded)
- Large-scale capital expenditure and business risk associated with new electric furnace investment (establishment and construction of the joint venture)
Last updated: June 24, 2026