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2013 Review . Third Year Achievements of Medium-term Management Plan In adhesives, we achieved the goals set for 2013 and the medium-term management plan through higher sales of the new product, Aron Alpha, and functional adhesives for electronics materials used to make mobile devices. The Aron Alpha brand of instant adhesives retained top share given its high level of quality. This was due to redoubled promotional activities, including marketing campaigns for EXTRA GEL (released in 2012) targeting retail outlets and advertisements placed in specialty magazines. In the United States, Krazy Glue maintained its top market share because of enhanced promotional activities based on TV commercials and the Internet. In China, we focused on marketing to convenience stores and Japanese mass retailers. Despite sluggish performance in the area of housing materials, overall sales of functional adhesives were driven by increased sales of reactive type adhesives used in mobile devices and automobiles. In addition, we have restructured the industrial-purpose adhesive production system by completing the integration of Aron Ever-Grip Ltd.’s and the Takaoka Plant’s production operations. As a result, revenue and earnings in the adhesives business increased, which enabled us to achieve medium-term management plan targets. In construction materials, despite achieving fiscal 2013 targets due to increased sales of construction repair materials, we were unable to reach the medium-term management plan targets for 2013. In construction repair materials, our focus on increasing sales of mainstay exterior wall and rooftop waterproofing materials, and tile coatings resulted in steady improvements in construction performance, which enabled us to exceed annual sales targets. However, despite recording peak sales of rooftop waterproofing materials that achieved the target set in the medium-term management plan for 2013, we fell short of the overall target for construction repair materials. This was due to the major impact of delays in the development of exterior wall waterproofing and tile coating materials. In civil engineering, despite being unable to reach annual targets because of a drop in demand for grout-related products, sales were almost on par with medium-term management plan targets thanks to brisk shipments of Aron Soil for use in road construction. New Medium-Term Management Plan Initiatives in 2014 (Issues to Be Addressed) In adhesives, we will release new products on the heels of EXTRA GEL both in Japan and overseas to bolster the Aron Alpha/Krazy Glue brands and increase their market share. In order to create attractive new products, we will also deepen collaboration among Group companies in Japan, the United States and China by strengthening systems for developing adhesives, containers and related sales channels. In functional adhesives, we will tap into new demand and promote ongoing business expansion to address the rapidly increasing functionality of electronic materials used in the automobile and telecommunication fields. Regarding adhesives for housing materials resulting from the merger with Aron Ever- Grip Ltd., we will promote the development of environmentally sound products in an effort to expand this business while protecting the environment. In construction materials, we aim to further increase sales of construction repair materials by switching to a more innovative marketing approach and restructuring the rooftop waterproof business. We also plan to expand into the civil engineering field while making a concerted effort to grow the construction materials business. 2011 2012 2013 16,152 Sales 16,350 16,517 (Millions of yen) 2011 2012 2013 2,963 Segment income 3,011 3,290 (Millions of yen) Toagosei Co., Ltd. 16