Chubu Steel Plate Co.,Ltd.

Business Details

Comprises Chubu Steel Plate Co., Ltd. itself and CK Shoji Co., Ltd. The business purchases steel scrap as its main raw material and manufactures and sells Steel Plate Products using electric-arc furnaces. Its main demand sources are industrial machinery, construction machinery, and building/civil engineering applications. As the core business accounting for approximately 95% of consolidated net sales, it bears the majority of the Group's earnings. The business recovered from the molten steel leak accident of the prior period, and production and order-taking activities normalized; however, profit declined significantly as the metal spread narrowed due to a decline in selling prices amid deteriorating steel market conditions.

Recent Overview

Sales volume recovered following the molten steel leak accident, but profit declined significantly due to deteriorating market conditions

In FY2026 (ending March 2026), the new electric-arc furnace resumed operation following the molten steel leak accident of the prior period, and with production and order-taking activities normalized, sales volume exceeded the prior period, resulting in net sales of ¥48,346 million (up ¥419 million year on year). On the other hand, plate steel selling prices fell significantly below the prior period due to deteriorating steel market conditions, and since the decline in selling prices exceeded the decline in steel scrap prices, the metal spread narrowed. Segment profit was ¥547 million, a significant decrease of ¥1,742 million year on year.

Key Products

Growth Drivers

• Achieving improved productivity and cost reductions through stable operation and full performance of the new electric-arc furnace
• Expected continuation of high plate steel market prices as blast furnace makers and other companies push forward with price increases
• Recovery trend in demand driven by increased production of production machinery and general-purpose industrial machinery
• Responding to decarbonization demand and expanding added value through Green Steel and EcoLeaf certification
• Ensuring quality and improving raw material procurement accuracy through introduction of the AI scrap inspection system
• Strengthening the manufacturing and sales structure by leveraging the business alliance with Nakayama Steel Works, Ltd.

Risks

• Risk of declining plate steel selling prices due to deteriorating steel market conditions (prices fell significantly year on year in the current period, narrowing the metal spread)
• Risk of rising costs due to continued high price levels for steel scrap, the main raw material, and fluctuations in domestic and overseas market prices and exchange rates
• Risk of equipment accidents at the steelmaking plant (concerns over recurrence of the molten steel leak accident of the prior period)
• Risk of weak demand among main demand sources (industrial machinery, construction machinery, building/civil engineering); demand for building applications continues to be weak due to labor shortages and rising material costs
• Risk of surging energy prices (rising crude oil and electricity costs due to instability in the Middle East)
• Risk of deteriorating overseas economic conditions, including U.S. trade policy (reciprocal tariffs) and China's economic slowdown