Integrated Report 2021

KITO CORPORATIONSHINJUKU NS Building 9F, 2-4-1,
Nishi-Shinjuku,
Shinjuku-ku, Tokyo 163-0809, JAPANhttps://kito.com

Profile

Contents
Introduction

Kito works for greater safety, functionality andcustomer confidence.
Every aspect of our society is showing clear, constant evolution, from daily life to our highly
specialized industrial frontiers. Catering to the human need to lift, transport and hold heavy loads is
central to social growth. Doing that with the greatest attention to safety and functionality has been
Kito’s mission since its founding in 1932. Kito works to build customer trust in our unique products
and services, created to help build a more convenient and comfortable society.

2

Corporate Mission

Kito’s Value Creation
4

Kito’s History

6

Kito’s Value Creation
Process

10

Risks, Opportunities,
Materiality

12

Financial and Capital
Strategy

14

Financial and NonFinancial Highlights

Kito’s Foundation
16 ESG Management
18 Environment
19 Society
21 Corporate Governance
24 Directors

Data
25

Six-Year Financial
Highlights

26 Corporate Profile
27 Stock Information

Reference Guidelines
International Integrated Reporting Council(IIRC): International Integrated Reporting
Framework
Ministry of the Environment: Environmental
Reporting Guidelines 2012
GRI: GRI Sustainability Reporting Guidelines (G4)*In a June 2021 reorganization and merger, theIIRC became the Value Reporting Foundation(VRF).

Reporting Period
April 2020 to March 2021

Integrated Report 2021

1

Introduction

Corporate Mission

KITO’s Mission: Deliver Unmatched Satisfaction to Our Customers
KITO is committed to enhancing customers’ safety and productivity at customers’ operations by providing products and services with innovative ideas and cutting-edge technology. KITO always uses ourcustomers’ perspective to design and bring innovative solutions to the material handling industry.
KITO values the “Trust from our customers” as our first priority. KITO strives for our success basedon this mission and believes it leads to the happiness of KITO team members and prosperity for our
stakeholders.

KITO’s Quality: Our Driving “Spirit” is “Quality”
KITO believes the “Quality” of our products and services is the most important value of the company.
KITO is committed to the highest quality in safety, ease of use, satisfaction to the customer needs, andenvironmental adaptation. KITO never sacrifices its quality for cost constraint, but provides it throughour technology and innovation.
KITO delivers our highest “Quality” to our customers through the shared spirit of each KITO teammember: “Everything is for our customers’ value”.

Kito will nimbly respond to social changes and new demand trends in markets
and industries as we build a framework focused on future growth.
Through our products that excel in safety and durability, waste-free,clean processes for producing and distributing them, and after-saleservices based on mutually trusting relationships with our customers,
Kito makes workplaces safer, reduces environmental impact
and contributes to society in broad ways.

KITO’s Innovation: Change and Challenge Always
KITO is committed to constantly improving our products, services and our operation through relentless
innovation, and earns customers’ “Trust” as the leader of the industry. KITO always overcomes any
constraints with our innovation and unceasing dedication. KITO highly regards and rewards our teammembers that strive for higher goals by innovating on behalf of our customers.

Value of KITO people: Integrity, Honesty, Pride and Gratitude
KITO people always act with integrity and honesty. KITO has pride in our business and in our behavior,and is always grateful to everyone and everything around us.

2

KITO CORPORATION

Integrated Report 2021

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Kito’s Value Creation

Kito’s History
Since being founded, Kito has consistently pursued not only safety and security, but everhigher quality and technological innovation as indispensable aspects of manufacturing.
Starting with the establishment in 1990 of our U.S. subsidiary, we have expanded ouroverseas business and currently supply Kito products worldwide, with a 60% market sharein Japan and 40% share in the U.S. (according to our internal research).

1932 Established the Kito Manufacturing

2002 Developed LEVER HOIST Model L5

1983 Moved Head Office & Factory from

Company in Omori, Tokyo

In order to deliver Kito’s added value of safety and reliability to markets worldwide, wewill continue our relentless dedication and unwavering conviction to be the world’s mosttrusted hoist and crane maker.

Kawasaki to Showa-cho, Yamanashi

2014 Acquired all shares of the PEERLESS

2008 Established KITO KOREA CO., LTD. in

INDUSTRIAL GROUP, INC.

Korea

Inc. in the U.S.

2018 Acquired all the shares of ERIKKILA OY

2010 Acquired all shares of ARMSEL MHE PVT.

2011

1945 Moved Head Office & Factory toNakanoshima, Kawasaki
its kind in Japan

1958 Developed 57 Series Electric Chain Hoist
1959 Developed KITO MIGHTY, a manual chain
hoist

1995 Established JIANGYIN KITO CRANE CO.,1997 Established SIAM KITO CO., LTD. in1982 Developed MIGHTY M3 manual chain

1998 Developed ER Series, Electric Chain Hoist

hoist with a 1000 N/mm2 chain

Established PT. KITO INDONESIA in
Indonesia

2020 Acquired all shares of Van Leusden in thein Thailand

2016 Established Kito Chain Italia S.r.l. in Italy

Netherlands

Acquired all shares of PWB Anchor LTD. inAustralia

Developed Electric Chain Balancer(Billions of yen)

Developed RY Series of Wire-rope Hoist(Billions of yen)

60

60

50

50

40

40

30

30

20

20

0

0

2012 Established KITO TAIWAN CO., LTD. in

Carlyle Group

TaiwanDeveloped LX Series Lever Hoist, awarded Gold Prize Good Design

ThailandCorporation

2019 Established KITO HOIST THAI CO., LTD

Developed EQ Series Electric Chain Hoist

2003 Accepted capital participation from The

1996 Established Kito Philippines in Philippines1970 Changed corporate name to Kito

in FinlandLTD. (India), making it a wholly owned
subsidiary

Established KITO DO BRASIL COMERCIODE TALHAS E GUINDASTES LTDA in
Brazil1993 Established KITO CANADA INC. in CanadaLTD. in China

Practices of the Employment of Persons
with Disabilities (Ministry of Health,Labour and Welfare)Good Design Award awarded to CX seriesof hand chain hoist

1990 Establish KITO INC. and Harrington Hoists,

1947 Developed Lever Hoist, the first device of2017 Received the Minister Award in Good

2004 Established Shanghai Kito Trading in China
Spun off the Logistics System Division

2006 Established Kito Europe GmbH inGermany

Developed CX Series Manual Chain Hoist

2007 Stock listed in the 1st section of Tokyo
Stock Exchange (Aug. 9)

Net sales trends

(FY)

1932

(FY) 1932
1988 1989
1998 1999
2008 20092018 20191981 1980
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2008 20072009 20102011 20102012 20112013 20122014 20132015 20142016 20152017 20162018 20172019 20202021 2020 2021
1980

#1932

4

KITO CORPORATION

#1980

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Integrated Report 2021

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Kito’s Value Creation

Kito’s Value Creation Process
Kito ensures quality through an integrated production management framework covering
everything from raw material procurement to chain manufacturing, component processing, product assembly, and inspection. By supplying products with superb safety and durability, we help create safe work environments in all types of industries.

Social needs andissuesIncreasing safety- andsecurity-consciousness

Providing a safe labor
environment

Materiality

Shrinking workforce(aging and shrinking population)

Contributing through social
infrastructure

InputsComfortableenvironment

Environmentally conscious productand manufacturinglivingdevelopment

Business model

Manufactured capital
Production facility enhancement/
High percentage of in-house manufacturing
In-house manufacturing of important parts that affect quality

Human capital
Securing diverse human resources

Highly transparent
management

Global warming

Diverse and highly
appealing organization

Solid management
structure

Outputs

Outcomes

A lineup of highly durable andsafe products that meet customer needs

Manufactured capital

HoistsRatio of overseas employees: 74%
Ratio of employees with disabilities: 6.73% (as of October 2021)

Number of employees on a consolidated basis: 2,262
6 of 15 executive officers are of non-Japanese nationality

Kito’ssupply chain

Intellectual capital
In-house product development, design, and testing

PDCA cycle

Patents for core components of main products

A product that lets you raise or lower heavy objects throughmanual or motorized operation. Our durable and safe hoists
embody Kito’s proprietary technology and know-how.

Natural capital
CO2 emissions reduction: 13%*

Clean production and supply processes
Energy used in production*Energy intensity calculation method changed from August 2021

Cranes, when combined with hoists, enable 3D movement ofheavy objects. The many different styles are suited to eachapplication and include overhead cranes, jib cranes, andbridge cranes.

Social and relationship capital

Below-the-hook devices

A financial strength that supports growth
Total assets: ¥65.1 billion
Free cash flow: ¥4.36 billion

6

Electric power usage reduction: 8%*

Manufacturing

Per ton of production volume
CO2 emissions: 1,721 t-CO2*
Electric power usage: 3,069 MWh*

Financial capital

KITO CORPORATION

10-year electric chain hoist vertical brake warranty

CranesNatural capital

Sales agencies in over 50 countries
Top-share brands in the major markets of Japan and the U.S.

Intellectual capital
Expanded customization capabilities; coordination with robots

Procurement

Sales

Collaboration with business partners & trusted brand

10 production hubs
30% improvement in Head Office factory production capacity

Human capital

DesignDevelopment

Creation of social
value and sharingof value withstakeholders

Corporate Mission

17 bases overseas
On-site factory tours: 150 (FY2019)

Foundation and strengths
supporting our businessInvolvement with society

Gover

Providing dedicated models for wind power generation,and product development and delivery of dedicatedenvironmentally friendly models

Social and relationship capital

P.2

Environmentally friendly
manufacturing

VOC reduction: 81% (vs. FY2015)*Energy intensity calculation method changed from August 2021

nance

An attachment used when lifting heavy objects. Different
types we offer include chain and magnet types, as well as
those made of fabric. We also have specialized below-thehook devices for specific applications.

Financial capital
Consolidated payout ratio: 26.2%
Shareholders’ Equity Ratio: 45.4%

Integrated Report 2021

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Kito’s Value Creation Process

Structure Supporting Value Creation
Kito is leveraging robust cooperation among Group companies to transition to a businessstructure that will produce solid profit even when there are significant changes in theexternal environment. We will nimbly respond to new demand trends in global markets
and industries as we build a framework focused on future growth.

InputsBusiness model and outputs

N Human capital

N Social and relationship capital

Kito believes that having diverse human resources is a

Kito possesses a sales network that covers over 50

foundation for the Company’s economic development

countries worldwide. Alongside our business partners,

and sustainable growth. With our Corporate Mission

which include customers, sales agencies, and suppli-as the organization’s unifying force, we aim to be aers, we contribute to solving social issues through ourGroup with a high sense of ethics.

business operations.

develop our business in order to help achieve a sus-

N Intellectual capital

N Financial capitaltainable society.

Since our founding, Kito has contributed to making

Kito aims to raise capital efficiency with capital costs

products smaller, lighter, and easier for customers to

as our benchmark, and provide TSR that meets share-use. We put our own effort into development, design,

holder expectations, by balancing financial soundness

and testing, and have amassed core technologies

and growth as we engage in business.

The business of the Kito Group is supported by six
types of management resources: manufactured capital, human capital, intellectual capital, natural capital,social and relationship capital, and financial capital.
Kito’s business model solves social issues and we

N Manufactured capital
Kito invests to increase and enhance production facilities and responds to changes in demand with resilientand flexible production. Additionally, through in-house

The Kito Group’s primary business covers the development, design, manufacturing, and sale of hoists, cranes,
chains, and similar equipment. We offer customized
products that address differing needs according to theusage environment, the type of load being handled, andmass production products standardized through maketo-stock production, all in addition to aftercare services.
With a network of production sites dispersed aroundthe world, we have endeavored toward environmentallyconscious manufacturing and have built an efficient
supply chain. We deliver our products and services
through an overseas sales network that covers morethan 50 countries worldwide—including the regions ofNorth America, Asia, and Europe. Kito’s products, which
excel in superb safety and durability, are used in a wide
range of industries throughout the world, including manufacturing, mining, construction, civil engineering, andclean energy, as well as integral parts of everyday life,
such as food production and entertainment.

while ensuring product safety and quality.

manufacturing of important parts that affect quality,

N Natural capital

we are continuing to ensure our ability to deliver

By establishing clean production and supply process-high-quality products.

es, and also minimizing the energy used for produc-

Outcomes
Kito believes that helping create safe work environments contributes to solving social issues. Alongside
our business partners, which include sales agencies andsuppliers, we contribute to the broader society by delivering products with superb safety and durability.

tion, Kito will continue contributing to global
environmental preservation.

Kito GroupTop-Share Brands with
Highly Regarded Quality

Americas
In the U.S., Canada, Mexico and Brazil, we havebroad sales channels and service networks. Hoists
and hoist accessories, such as chains and slings,
are produced in the region.

EuropeJapan

The combination of our four companies
centralized by Kito Europe in Germany,
will help maximize the synergetic
effect for our business development
and improve our brand awareness inthe European region.

China
Here our business model focuses on
local production and consumption. In
the Chinese market, where wire-rope
hoists are in great demand, Kito
enjoys the leading market share.

Asia

At its main Yamanashi Plant Kito produces
chain and lever hoists as core products undera system of total production control for customers in over 50 countries.

Australia
From hoists to chains, the region’s
product lines are among the broadestin the group, meeting the needs of abroad range of customers.

In South Korea and Thailand we
produce cranes, an essential factory-equipment category. We areworking to build one-stop services,
including after-sale service.

8

KITO CORPORATION

Integrated Report 2021

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Kito’s Value Creation

Risks, Opportunities, Materiality

External environment awareness

Risks

Opportunities

Materiality

Kito’s response

KPI

D evelop products durable over thelong termP roduct differentiation

R atio of in-housemanufacturing Critical component patents

U ser education Product warranty period

Providing a safe labor environment

Increasing
safety- andsecurityconsciousness• Increasing safety-consciousness in emerging countries• Spread of counterfeit
goods• Incorrect use of
products• Diversification of
product users

Shrinkingworkforce(aging andshrinkingpopulation)• Aging of laborers(customers andemployees)• Obstacles to hiring
employees• Need for less labor
intensive, less energy
intensive processes• Declining appeal of
manufacturingindustries Price competition in emerging
markets Inundation of cheap counterfeit
goods Stagnation of safety-consciousness among laborers Industry restructuring Possibility of accidents fromproduct usage by inexperienced users

 Young employee labor
shortages Problems passing down skills
and expertise Adoption of robots at manufacturing sites Lower manufacturing quality Receptivity to high-quality,
long-lasting higher priced goods
P roduct differentiation
 Retention of users by providing
educational opportunities Development of products thatcan be safely used by anyone Need for compact sizes andlighter weights
C ommunicate attractiveness to
the labor market Technological development of
automated control and automated carrying Process coordination withrobots Creation of opportunities forfostering the next generation• High-quality products as social
infrastructure• Product differentiation• User education• Development of products that aresafe, secure, and easy for anyone touse (compact, lightweight)

Contributing through social infrastructure• Technological development and sale ofautomated control and automatedcarrying• Process coordination with robots• Customization capabilities that match
applications• More efficient production

Environmentally conscious productdevelopment and manufacturing

Comfortablelivingenvironment• Intensifying natural
disasters• Aging social
infrastructure• Increase of depopulated areas Supply chain interruption due
to a disaster Surging manufacturing costs/
material costs Depopulation/aging of residents in regional areas Increased demand due to disaster recovery
 Increased demand due to infrastructure maintenance Addressing less labor intensive,
less energy intensive processesF unctionality as standard products• Maintaining clean production and supply processes• Product lineup that contributes to solving environmental issues

E nhance and expand production
globalization and localization
E xpand customization capabilities
that meet the needs of diverse
customersP romote less labor intensive, lessenergy intensive processes byworking with robots

M aintaining clean production andsupply processesD evelop and propose environmentally conscious products (windpower, solar power, etc.)
U tilize a water recycling systemD omestic and overseas
market share No. of overseas bases Use case numbers for new
production adoptionE lectrical power usage inproduction CO2 emissions VOC usage volume

R educe VOCs

A diverse and highly appealing organization

Globalwarming• Transitioning to clean
energy• Mitigation of environmental burdens• CO2 reduction Declining investment needs forfossil fuels Lost procurement and sales
opportunities Increased demand due to environmental and natural energy
industries
U se of products in wind power
generation
 Improved corporate image frominitiatives for reducing environmental burdens (clean production & supply processes)• Communicate attractiveness to thelabor market• Promote Kito’s value internally andexternally• Foster the next generation that will
carry manufacturing forward• Shape personnel and networks to
respond to the global market

C reate a work-friendly environment Implement labor market PR activities and on-site facility tours
F oster future managers andsupervisorsH ire, train, and utilize global
employees
T horough recognition and understanding of KITO SPIRIT

R
 atio of overseas
employees Ratio of non-Japanese
officers
 No. of designers, developers, and testers
O vertime hours
 Utilization ratio of paid annual leave

Solid management structure

Highlytransparent
management

10

KITO CORPORATION• Further improvementof corporate value• Sound balance sheet• Returns tostakeholders Increased capital expenditureburden Fewer shareholders; fewer
investor interest in Kito
 Incidents of impropriety Strengthening information
disclosure Improvement of investment
efficiency
 Acquisition of long-term
investors• Appropriately return profit toshareholders• Further strengthen global governance• Implement well-timed M&AP rocurement that takes governanceand capital efficiency into accountA cquire long-term, top-tier investorsS trengthen IRS hareholders’ Equity Ratio Shareholder returns; consolidated payout ratio Net assets per share Implement well-timed M&A

Integrated Report 2021

11

Kito’s Value Creation

Financial and Capital Strategy
N Basic policy

value and, in our next mid-term management plan, are

The Kito Group delivers value that exceeds customer

promoting improved capital efficiency and increased

expectations and we maximize the value of the Kito

cost of capital spread.

brand in the marketplace. The pillars of our financial

N Shareholder returns and investment

strategies are to improve capital efficiency, maintain astrategies

strong financial footing, raise the cash flow generating

situation, market conditions, business growth poten-

The Kito Group is increasing cash flow generating

tial, and return on capital cost, while raising capital

capabilities through initiatives such as expanding ourefficiency, maximizing free cash flow, and enhancing

product portfolio and concentrating on high-marginshareholder returns.

business, and we are making investments that will

In regard to our policy on dividends, we believe it islead to the next stage of our growth. The total

important to secure sufficient retained earnings tocapabilities of each business, allocate investment—

It is necessary to build a robust business base inamount of capital investment in fiscal 2020 was

reinforce our business base and prepare for future

including M&A—for growing cash generated, andorder to achieve sustainable growth and become a¥2,500 million, including ¥1,080 million invested inbusiness development, in addition to appropriately

tying these into sustainable growth.

strong, resilient company able to withstand drastic

Japan, which was invested primarily on increasing

returning profits to shareholders commensurate with

In our previous mid-term management plan, wechanges to the external environment. To date, Kito

the production capacity at the Head Office & Factory

the Company’s performance. Under this policy, we

announced “returning to a high-margin businessGroup’s financial foundation has been stable and weand updating the environmentally friendly features ofare working to actively return profits to our sharehold-structure” as one of our mid-term management plan

are taking an approach of meeting capital require-equipment. Regarding the allocation of resources

ers by targeting a consolidated payout ratio of 20% ortargets. We were able to produce results by increasing

ments by remaining vigilant regarding financial sound-going forward, in addition to this kind of investment

higher, subject to the overall consideration of consoli-

cash flow from operating activities and fortifying ourness, with a focus on cash flows from operating

in production, we will continuously invest in growth

dated results and our financial position. Additionally,

earnings capabilities in terms of our operating cash

activities, while also utilizing external loans. Our basic

aimed at IT investment and enhancing future profits

we think it is important to enhance total returns byflow margin, while also boosting operating income

capital strategy is to balance this sound financial foun-

while also keeping our financial foundation balanced

raising dividends and market evaluation while

and ROE. We aim for greater financial soundness anddation with active investment in growth, while at theand stable. Free cash flow created will also be used

improving capital efficiency in the medium term.

robust growth for the Kito Group and have placed ansame time enhance shareholder returns, practice man-for shareholder returns and further strengthening thisemphasis on corporate sustainability. We believe thatagement focused on capital costs, and strengthen

financial foundation. Regarding investment, we will

generating cash flow alongside profit that exceeds

product portfolio management so that we can further

continue to make precise investment decisions based

cost of capital will translate to improved shareholder

raise capital efficiency and enhance corporate value inon proper consideration of factors such as the global

Cash Dividends per Share / Payout Ratio

TSR (10 years, including dividend)

(yen)

(%)

50

80

32.3

34.0

29.4

21.9

30.6

23.7

25.1*

26.2

22.1

60

48

44
40

20

0

28

25

20
12.5
7.5
2014/314

12.5
2015/3

28
14

12.5

33

2016/324

14

15
2018/3

 Interim dividend Year-end dividend

600
500
400

20

300
200
100
0

30

22

2011/3

2012/3

2013/3

2014/3

2015/3

2016/3KITO

2017/3

2018/3

2019/32020/32021/3

TOPIX

18
20
2019/324
12
2020/32021/322<Share Performance (Total Shareholder Return)>
3 years

5 years

10 years

1 year2022/3

 Payout ratio (right axis)

Note: T he dividend amounts noted above take into account the following stock splits: a 100-for-1 stock split of Kito common stock on April 1, 2013,
and a 2-for-1 stock split on October 1, 2014.
Note: With regard to the year ended March 31, 2014, the actual per-share interim dividend (taking place before the October 1, 2014 stock split) was
25 yen, while the annual dividend (after the split) was 12.5 yen per share.
* In accordance with the upward revision on September 29, 2021, the payout ratio was changed from 28.2% to 25.1%.

KITO CORPORATION

(%)

700

30

44

18

14

2017/324

40(forecast)12

the medium to long term.

Cumulative

Annualized

Cumulative

Annualized

Cumulative

Annualized

KITO+86.1%

-1.9%

-0.6%

+138.8%+19.0%+442.8%+18.4%

TOPIX+42.1%+22.1%+6.9%+62.3%+10.2%+179.4%+10.8%* TSR (Total Shareholder Return): Factors in capital gains and dividends when measuring the total return generated by a stock* Graph values are indexed market prices in terms of TSR, with March 31, 2011 closing price data set at 100 (holding period through end-March 2021)

Integrated Report 2021

13

Kito’s Value Creation

Financial and Non-Financial Highlights (as of March 31, 2021)
Financial Highlights

Non-Financial Highlights

Net Sales

Operating Income(Billions of yen)
62.0(Billions of yen)
7.0

61.2

60.0

5.4

5.2

58.0
56.0

6.4

6.0

58.7

5.0

55.8

55.1

4.2

4.0

4.6

4.4

Overseas Locations

54.0
52.0

3.0

51.8

51.1

1.0

48.0
46.0

17

2.0

50.0

0

2016.3 2017.3 2018.3 2019.3 2020.3 2021.3

2016.3 2017.3 2018.3 2019.3 2020.3 2021.3

In Q1, net sales gradually recovered despite decreased
demand, while in Q4, demand basically returned to theprevious year’s Q4 level and we posted net sales of
51,800 million yen (down 11.8% YoY).

Although we dedicated effort toward securing profit
through Group-wide work efficiency gains and reduced
expenditures, the impact of decreased demand mainly inJapan and the U.S. resulted in operating income of 4,400
million yen (down 18.6% YoY).

Net Income Attributable to Owners of Parent

Cash Flow from Operating Activities(Billions of yen)
4.5

(Billions of yen)
7.5

7.0

4.0

5.3
5.0

2.4

Kito operates 17 subsidiaries in 16 countries aroundthe world and provides products and services in morethan 50 countries around the world.

4.5
3.9

2.3

1.5

Top-Share Brands

3.5

1.8

74.9

%

Kito’s business portfolio supports results by being
effective for diverse regions and customers.

6.6

3.2
2.8

3.0

locations

Overseas Sales Ratio

2.5

Number of employees on aconsolidated basis

2,262(down 66 from the previous fiscal year)

00

2016.3 2017.3 2018.3 2019.3 2020.3 2021.3

Due to recording an impairment loss at our Dutch subsidiary and restructuring costs at our Australian subsidiary(the total of both amounting to an extraordinary loss of
520 million yen), net income attributable to owners of parent came to 2,300 million yen (down 26.8% YoY).

Due to income before income taxes of 3,600 million yen,depreciation of 2,600 million yen, and decrease in inventories of 1,200 million yen, cash flow from operating activities came to 6,600 million yen (up 1,200 million yen YoY).

Interest-Bearing Debt / Shareholders’ Equity Ratio

ROE(Billions of yen)
25.0

(%)
100

24.1
21.4

20.0

19.2

18.7

18.3

19.8

(%)
18

15.0

13.2

60

41.2
33.8

10.0

36.7

41.4

42.8

5.0

0

12.2

10.1
8.4

45.4

Kito’s products and services are highly regarded worldwide for their safety and durability. We have established positions as top-share brands in Japan, the U.S.,
and China, which are leading markets.

Accompanying the expansion of our global network,
our ratio of non-Japanese employees already exceeds
70%.

Employment of people withdisabilities

Executive officers with foreign
nationality

6.73

6

16.8

80
12

8.3

40
6

%

(As of October 2021)

20

2016.3 2017.3 2018.3 2019.3 2020.3 2021.3

 Interest-bearing debt

0

KITO CORPORATION

02016.3 2017.3 2018.3 2019.3 2020.3 2021.3

 Shareholders’ equity ratio

Due to an increase in short-term debt of 4,700 million yen
and a decrease in long-term debt of 2,900 million yen,interest-bearing debt came to 19,800 million yen (up1,500 million yen YoY).

14

2016.3 2017.3 2018.3 2019.3 2020.3 2021.3

Due to an increase in net assets from a 5,200 million yen
decrease in treasury stock, as well as a decrease in net
income, ROE came to 8.3% (down 3.9% YoY).

With the goal of being a company in which anyone canwork, Kito is committed to systematically and continually improving the working environment. These efforts
have contributed to the company achieving an employment rate for people with disabilities of 6.9%, which isone of the highest rates in Japan and well above thegovernment’s statutory rate of 2.2%.

Six of the Kito Group’s 15 executive officers are foreign nationals. We appropriately place various humanresources.

Integrated Report 2021

15

Kito’s Foundation

ESG Management
Kito responds to the need to safely lift, move and hold heavy loads in all industries andregions, enabling the creation of new value without the constraints of gravity. As a corporate
member of society, we always bear in mind our responsibilities and we are committed toadvancing legal compliance, which is our top priority, fair and transparent corporate governance, and timely, broad and fair disclosure of information. We also actively promote clean,environmentally friendly manufacturing and social contribution, among other initiatives.
Key Themes• Contribution to a circular
economy• Energy saving and global
warming countermeasures

Environment• Waste reduction• Conservation and effective
use of water resources•A chievement of safe work
environments• Promotion of diversity

Social•C ontribution to regionalsociety

ESG Initiatives

We are helping to create a rich, sustainable society
where people live in harmony with the environment, by adopting action guidelines that include
setting goals for reducing environmental impact
and preventing pollution through our operations
and total product life cycles, while continuously
improving our management system and promoting
environmentally conscious activities.

By manufacturing and selling hoists and cranes
with superb safety and durability, we contributenot only to stakeholders such as customers, distributors, and business partners, but broadly tosociety.

SDG Initiatives
Safe Water
The wastewater treatment facilities at our Yamanashi Head Office & Factory handle
approximately 200 tons of wastewater per day. Wastewater from manufacturing activities
is treated with a coagulation-sedimentation method that uses chemicals to make harmful substances
coagulate and sink, while daily-use wastewater is treated with an activated sludge method that utilizes aerobic microorganisms. Since we abide by Yamanashi Prefecture’s expanded regulations,which are more stringent than the Water Pollution Prevention Act, we check the condition of water
quality every day and ensure that water has been purified before being released into the river.

Regenerative Energy
Our heavy-duty lifting hoist jointly developed with an authorized distributor is able to generate electricity while using electricity, which helps contribute to energy saving measures. Electricity is consumed inorder to operate the hoist, but electricity is simultaneously discharged as well. Reusing discharged
electricity without letting it go to waste is the definition of regenerative energy. Fast-charging a lithium-ion battery with power regenerated when lowering the hoist extends the possible hours of continuous use.

Environmentally Friendly Packaging
Using dedicated transportation and storage boxes for customers, as well as composite
packaging for large orders, not only helps reduce packaging material, but also lessens
work for users when unpackaging products. Additionally, we are making progress withreusing packaging boxes when shipping components between Kito Group companies.

Products that Support Social Infrastructure
Kito products are indispensable for building social infrastructure such as roads, railways,
ships, and power plants. By providing products and services with superb safety and durability, Kito supports the safety and efficiency of customers engaged in social projects.
• Corporate governance• Risk management• Compliance

GovernanceTo achieve sustainable growth and improve corporate value on a medium- to long-term basis in linewith our Corporate Mission, we are fully engaged
in enhancing corporate governance in accordancewith our basic concepts, based on the belief thatthe essence of corporate governance lies inincreasing the dynamism of management by ensuring it is transparent and fair and by making management decisions in a prompt and decisive manner.

A Work-Friendly Company for All
With the goal of being a company in which anyone can work, Kito is committed to systematically and continually improving the working environment. In particular, our promotion of employing people with disabilities helps improve the safety and productivity of
workplaces and engenders a sense of unity among employees. Disabled employees makeup 6.73% of our total workforce (as of October 2021), which is far above the legal
mandate.

Flexible Manufacturing System
Peerless Chain Co., our U.S. subsidiary, has started manufacturing hoist chains.
Manufacturing chains closer to customers in the U.S. market, where demand is strong,helps reduce the expense of shipping from Japan. Furthermore, we have moved the manufacture of some of our main products to our Thai subsidiary and are striving to reduce
manufacturing costs and the cost of materials in our supply chain. While focused on afuture with growing demand, we will increase the production capacity of hoists acrossthe entire Kito Group.

16

KITO CORPORATION

Integrated Report 2021

17

Kito’s Foundation

Kito’s Foundation

Environment

Society

PolicyN Environmentally friendly manufacturing

PolicyN Employee health

Kito shall contribute to realizing an enriched and sus-

renovating our manufacturing to enable cleaner, more

Under the corporate mission of “Deliver Unmatchedmental health (stress) checks, further care is provided

tainable society where people are in harmony with theenergy-efficient operations. At the Yamanashi Head

Satisfaction to Our Customers,” Kito strives to com-

for those who require it by an occupational physician

earth by developing business activities and providing

Office & Factory, our top priority is to maintain a safe

municate with stakeholders and we have positioned

or full-time public health nurse. Furthermore, we strive

products and services in the material handling field.

workplace for all by paying careful attention to fire andsolving social issues through our business and provid-

to support employee health by including subsidies for

As concrete steps, we shall set goals for reducing

other work-related risks, and harmful elements suching customers with high quality products and services

influenza vaccines and other items as part of employ-environmental impact and preventing pollution throughas noise and odors, as well as advancing efforts toas our highest priority management issues. “Kitoee benefits.

our operations and total product life cycles, while con-reduce energy consumption, CO2 emissions, and other

Quality” means overcoming tight cost restrictions totinuously improving our management system and pro-environmental impacts.

realize products that are extremely safe, easy to use,

N Hiring disabled people

meet customer needs, and that contribute to work-

We put special effort into hiring people with disabilities

places, and we set ourselves high targets in order tounder the belief that the job opportunities a corpora-contribute to realizing a sustainable society.

tion offers are an important part of its social contribu-

moting the following environmentally conscious
activities.

We aim to further reduce environmental impact by

N Green procurement
Kito has specified Green Procurement Guidelines

1.

Measures against climate change

based on our environmental policies and we strive totion. Our basic labor policy is to build a work

We will decrease energy consumption to reducegreenhouse gas emissions.

lower environmental impacts with the cooperation ofenvironment in which all people, with different person-

Initiatives

alities, abilities and disabilities, can work together in

Hazardous Substances (RoHS) standards, we have

N Customer safety and peace of mind

place improvements as a concerted group-wide effort

independently identified and are preventing the use of

In workplaces all over the world that handle materials,

to become a group where anyone can work comfort-

19 selected hazardous substances (Kito’s “banned

we will continually maintain a customer-oriented per-ably. Disabled employees make up 6.73% of our total

Sustainable use of resources19”). Currently, all our standard manual and electric

spective. By proposing new ideas and then providing

workforce as of October 2021, far above the legal

We will understand the finiteness of resourcesand ensure their effective use by saving andrecycling them.

chain hoists comply with RoHS standards. For otherthe products and services that bring them to fruition,

mandate of 2.3%. In September 2017, Kito won the

products, we are actively working to switch to prod-

we will gain the trust of the market, supporting cus-Grand Prix for workplace improvement for disableducts that meet RoHS standards and do not use thetomer safety and the efficient functioning of society.

employees from the Ministry of Health, Labour and

Measures to protect biodiversity“banned 19.”

N Development of human resources

Welfare.

We will strive to mitigate our impact on biodiversity and conserve ecosystems.



We value diversity in hiring and work to ensure thatN Social contribution

Control of chemical substances
2.

3.

4.

We will continuously reduce and replace substances having significant impacts on people andthe earth.

Compliance
5.

After employees receive regular health checkups andWe will comply with environment-related laws
and regulations, and other requirements that ourcompany agrees to.

our business partners. Based on joint industry guidelines such as the European Union’s Restriction of(fiscal year)
Environmental Data

Unit

Consumption of electricity
per amount of production

MWh/t

Emissions of CO2 per amountof production

t-CO2/tWaste

Initiatives
N Acquiring certification• The Group’s two major manufacturing facilities, ourYamanashi Head Office & Factory in Japan and ourfactory in Jiangyin, China, have received international
ISO 14001 certification for environmental
management.
• One of our main products, the EQ electric chain hoist(capacity: 980 kg), acquired the EcoLeaf environmental label. This involves the verification and publicationof quantifiable environmental impact data concerninga product acquired through life cycle assessments(including items with value,such as scrap metal)

Water withdrawal(tap water + groundwater)

Water discharge(industrial and non-industrial
wastewater)

Amount of organic solvents
used

2015

t

1,000m3

3.342
1.994
2,509
168.2

2020

3.069
1.721
1,630
113.7

1,000m3

46.6

42.9

t

68.9

12.9

our employees are motivated and happy.

harmony. Based on this we continuously make work-

We work to advance social contribution activities that

Out of the Kito Group’s employees, 74% are ofenable us to prosper together with regional and global

nationalities other than Japanese. We invite excellent

communities and to maintain clear, close and frequent

young people from Group firms around the world tocommunications, always keeping in mind our responsi-

attend Kito University, where they can learn about thebilities as a corporate member of society. In addition tofirm’s history and philosophy together, and develop

environmental preservation activities in Yamanashi

into the next generation of leaders. With the aim toPrefecture, we are also supporting volunteer activities

help employees develop their careers by utilizing theirand collecting donations for areas affected by large

abilities and characteristics, we are promoting thescale disasters. We also signed a contract as a “Goldcareer design system and internal recruitment system.

Partner” of the JAPAN Para-Ski Federation as a way to

N Workingsupport athletes competing on a global stage.

Kito quickly introduced teleworking as part of its promotion of a flexible working style. Group companies(fiscal year)
Social Data

2015

2020

have taken thorough measures to prevent infection by

Employees

681

677

the novel coronavirus, and are giving top priority to

Average employee age

41.7

43.8

Ratio of women in management positions

1.3%

3.5%

Ratio of disabled employees

6.68%

6.80%

keeping employees healthy so they are continuingwith teleworking.

under the Type III eco-labeling program managed by
the Japan Environmental Management Association
for Industry (JEMAI).

18

KITO CORPORATION

Integrated Report 2021

19

Kito’s Foundation
Society

Corporate GovernanceContributing through Social Infrastructure

Basic Concepts

N Solving the social issue of “being freeof gravity”

With the goal of achieving sustainable growth andequipment assists people and is used in close proximi-

The social issue that Kito is called upon to solve isty to workers, there is the risk not only that custom-“being free of gravity.” Gravity is a constant compan-

ers’ valuable assets may be damaged from drops orion to our daily lives on Earth. A diversity of organisms

load shifting, but also that the irreplaceable lives ofexists and the Earth is a beautiful blue planet thanks toworkers and those near them could be jeopardized. In

gravity. Also due to gravity, however, lifting, transport-other words, the significance of Kito’s existence ising, and securing heavy cargo is a considerable chal-both the social service of freeing workers from thelenge. Kito provides society with material handlingrelentless force of gravity and also facilitating a safe

equipment, particularly hoists and cranes, in order towork environment in which drops and load shifts dosolve this social issue. The equipment that Kito makes

not occur. This is simultaneously Kito’s source ofis used at workplaces to handle heavy items, but it is

growth. Since gravity on Earth never pauses, there is

not meant to replace humans. Rather, it is meant to

no end to the human challenge of lifting and moving

reduce the burden of labor and make tasks moreheavy objects. Consequently, demand for equipment

efficient.

that can control gravity is similarly unending.

This in itself creates new challenges. Since Kito

Responses to Materiality
Environmentally conscious
product development andmanufacturing

Reduction ofenvironmentally hazardous
substances and CO2

Elimination of waste andefficiency improvements
for work tasks

In order to solve the universal challenge of handling• We will effectively use limited resources across ourgravity, Kito, since being founded, has placed top

entire supply chain and strive to mitigate impacts onpriority on ensuring the safety of workers and creating

the natural environment.

an efficient work environment by delivering products• By maintaining a business structure that generates

with superb safety, durability, and usability. Kito products

strong, long-term, and stable profits, we will reinvest

have become indispensable for social infrastructure andcapital for future business growth and for ensuring

are recognized for their ability to make contributions tooptionality in our business strategies.

the development of industries in many regions going• We will establish an environment that is both condu-

forward. In order to continually deliver high added value

cive to employees leveraging their talents and thatin an economic environment that is difficult to predict

supports mentally and physically healthy work, whileand drastically changing, Kito aims to constantly andstriving to grow results as a union of individuals,

nimbly grasp social changes and continually innovate inteams, and organizations.

markets, all while continuing to be useful to society.

highest embodiment of our decision making and20

whose unifying force is our Corporate Mission. A teamneeded by society, while expanding business activities

that pulls together human resources with a high sensethat generate added value for customers and contributeof ethics and action for achieving goals is a team thatto growing new businesses and markets.

increases corporate sustainability.

KITO CORPORATION

Committee, an advisory body to the Board of Directors,

term basis, Kito is enhancing corporate governance inwith outside directors for a majority of its members.

accordance with the following basic concepts, basedon the belief that the essence of corporate governance

Board of Directors

Board of Corporate
Auditors

Nomination andCompensation Committee

Ratio of outside
directors

Ratio of outside
auditors

Ratio of outside
directors

lies in increasing the dynamism of management by
ensuring it is transparent and fair and by making management decisions in a prompt and decisive manner.
(1) W e respect the rights of shareholders and work to ensure
equality among them.
(2) W e consider the interests of stakeholders, including shareholders, and cooperate with them as appropriate.
(3) W e properly disclose corporate information and ensuretransparency.
(4) B ased on its fiduciary responsibility and accountability toshareholders, the Board of Directors aims to realize sustainable growth and improvement of corporate value on a medium- to long-term basis and enhance earnings power andcapital efficiency by strengthening management supervisionfunctions through the separation of management oversightand executive roles and the appointment of outside directors.
(5) T he Board encourages healthy engagement with shareholders.

42.9%

66.7%

60.0%

(3 of 7 members)(2 of 3 members)(3 of 5 members)

Board of Directors
The Board of Directors is comprised of seven directors,
three of whom are outside directors and independent officers, and, as the Company’s management decision-making body, the Board handles resolutions on legal matters,
makes determinations and approvals of basic management policies and matters important to the execution ofCompany business, and supervises the state of executionof business by directors. The Board is positioned as the

Structurehighest decision-making body of the Kito Group and it

Kito has chosen to be a Company with a Board of

exercises overall control, including making all decisions

Company Auditors, judging this to be the optimal corpo-

concerning important matters related to the Group.

rate governance structure for carrying out management

To ensure that the Board has the diversity and balance

based on our Corporate Mission. Within this structure, weof knowledge, experience, and know-how necessary tohave also adopted an executive officer system in order torealize sustainable growth and the enhancement of cor-facilitate dynamic operations by separating decision-mak-porate value of the Company over the medium to longing/management oversight from executive roles.

term, outside directors are appointed from among corpo-

Since the time of Kito’s public listing in 2007, we haverate executives and those with deep knowledge in themaintained an outside director ratio of one-third or higher

field based on their experience, insight, and expertise.

on the Board of Directors. At present, three of our seven

For internal directors, we ensure diversity by appointing

Board of Directors members are independent outside

directors from among people experienced in businessCorporate Governance Structure

General Meeting of Shareholders
Election·Dismissal

Nomination andCompensation Committee

Recommendations

Election·Dismissal

Board of Directors

Auditing

Election·Dismissal

Board ofCorporate Auditors

Accounting Auditor
Internal
Directors
2

External
Directors
3

Internal
Directors
4

External
Directors
3

Election·Dismissal

Executive Body

Internal
Auditors
1

External
Auditors
2

Auditing

President & CEO

action guidelines as we aim to shape an organization• We will pursue the development of products that arehave established a Nomination and Compensation

improvement of corporate value on a medium- to long-

Accounting Auditors
Internal Auditing
Department

Internal Audit Division
Executive Officers’ Meeting
Functional Division Headquarters

Business Division Headquarters

Advice andGuidance

Outside Experts• We will position Kito’s Corporate Mission as the

Auditors members are outside auditors. Furthermore, we(Lawyers, Tax Accountants,
Patent Attorneys, etc.)

a way that fosters our own business and unlocks new

directors, while two of the three Board of Corporate

Integrated Report 2021

21

Corporate Governancedivisions, including sales and manufacturing, and people
experienced in planning, development, and administration divisions. In addition to a regular meeting held once
each month in principle, extraordinary meetings are held
as necessary, resulting in a structure that enables prompt

Evaluation of the Effectivenessof the Board of Directors
The results of the fiscal 2020 evaluation of the effectiveness of the Board of Directors are as follows.

and appropriate business decisions. Furthermore, we

N 1. Evaluation method

have also adopted an executive officer system in order to

The non-anonymous survey of all seven directors andfacilitate dynamic business execution by separating deci-

three auditors gathered their evaluations of the following

sion-making/oversight from executive roles. The Board ofitems on a five-point scale, in addition to their opinions

Directors selects 15 executive officers and follows a(written in free response sections) on each item. Survey

management approach in which the Board fulfills its roles

items for fiscal 2020 were the same as those for fiscal

and duties as a supervisor of the execution of business.

2019 (taking into consideration the June 2018 revisions

Board of Corporate Auditors
Kito’s Board of Corporate Auditors is comprised of threemembers: one full-time corporate auditor and two outside
corporate auditors. In addition to performing audits inaccordance with the audit schedule determined in meetings of the Board of Corporate Auditors, members also
attend important meetings of the Board of Directors andBoard of Executive Officers to offer their opinions, while
also supervising and auditing the execution of businessby the directors in a strict manner. Members also verify
the adequacy and efficiency of the execution of businessby directors through information collected in coordination
with the Internal Audit Office and accounting auditor,
including information heard directly from the directors or
obtained through the inspection of important documents.
In addition to a regular meeting held once each month inprinciple, the Board of Corporate Auditors also holds briefings as necessary to gather information from the Finance& Accounting Division, the accounting auditors, and others.

to the TSE Corporate Governance Code).
Survey Items(1) Composition of the Board of Directors (composition, number andratio of outside directors, diversity, term of appointment, etc.)(2) Management of the Board of Directors (roles of the Board of
Directors, reference material details, delegation of authority,degree of dynamism of discussions, etc.)(3) Selection of agenda items (including the status of discussions
on compensation, appointments/dismissals, compliance, andthe like; status of responses to prior issues)(4) Structure supporting the Board of Directors (frequency of andopportunities for exchanging information, status of coordination among departments, information access, etc.)(5) Questions on voluntary committees (including the status of
discussions on composition, compensation, appointments/dismissals; plans for fostering successors, etc.)

N 2. Evaluation results (summary)Evaluation results confirmed that the overall effectivenessof the Board of Directors is being appropriately ensured.
In particular, at the meeting of the Board of Directors
when these results were presented, it was reconfirmedthat directors and auditors are afforded a forum for freely
and constructively voicing their opinions and engaging incompensation (the amounts of base compensation anddeal with the issues identified and make progress withperformance-based compensation) within the range rec-improvements in fiscal 2021 in order to further enhanceommended in the report by the Nomination andthe effectiveness of the Board of Directors.

Compensation Committee. Note that the Board ofThree issues that need to continue being dealt
with, and the measures to be taken

Directors may also elect to delegate to the Nomination

IssuesMeasures

Deepening discussions on
medium- to long-term strategies, product strategies
and regional strategies

In fiscal 2021, we will elevate the quality anddepth of discussions as we formulate thenext mid-term management plan (scheduled
to begin in fiscal 2022).

Increasing frequency of dis- Incorporating our experiences of the COVIDcussions about risk and con- 19 pandemic, we will share information on
ducting periodic reviews
the Company’s business risks and carry out
ample analysis and review.
Discussing management
succession plans

Although progress has been made with plans
for fostering management successors, wewill continue discussing plans for fostering a
successor to the president & CEO.

Officers’ Compensation System
Kito’s Board of Directors determines policies for set-

and Compensation Committee the determination of individual compensation amounts. The target ratio of eachtype of compensation is 6:3:1 (base compensation : performance-based compensation : stock compensation)
when there is 100% achievement of performance targets.
Base
compensation

Monthly base compensation is determined with comprehensive consideration of the levels at other companies
for officers with similar rank and duties, as well as Kito’s
performance and the salary levels of Kito employees.

Annualperformancebased
compensation(cash bonus)

This compensation is paid in cash at a specific time eachyear and reflects performance indicators in order to raiseawareness toward increasing the Company’s performanceeach fiscal year. The amount is calculated according to thedegree of achievement of the Company’s targets for consolidated net sales and EBITDA for the fiscal year, in addition to an evaluation of personal goals set each year byeach individual. Targets for EBITDA are set based on publicly announced figures and business plans formulated
each year taking into account the mid-term management
plan. These targets are revised as necessary in accord
with environmental changes and the recommendations of
the Nomination and Compensation Committee.

Stockcompensation(transferrestricted,
equity-based
compensation)

A standard annual amount corresponding to job grade isdetermined by the Board of Directors and a number ofcommon shares equivalent to this monetary amount isgranted at a specific time once a year. Transfer restrictions are canceled on the day of retirement of a director
or executive officer of the Company or one of theCompany’s subsidiaries.

ting the compensation, etc. of individual directors. In
making these determinations, the Nomination andCompensation Committee carries out discussions andmakes reports to the Board of Directors. Officer compensation based on these policies is as follows.

N Basic policy for the officers’
compensation system
Kito’s basic policy on officer compensation is to align thescheme with shareholder interests so that the schemefunctions as a sufficient incentive for achieving sustainable growth and enhancing the medium to long term
corporate value of the Group. When making decisions
on individual officer compensation, we use appropriate
criteria taking into account the duties of each officer.

58%

President & CEO
Executive Vice
President

29%
26%

52%

Managing Director

62%
0

20

40

60

13%
22%

28%

10%

80

100 (%)

 Base compensation  Performance-based compensation
 Stock compensation* We revised policies for determining individual director compensation in July
2021, prior to which, the Board of Directors was allowed to delegate to the
CEO decisions on individual compensation. Now, however, those decisions
can be delegated to the Nomination and Compensation Committee.

Nomination and Compensation
Committee

discussions, and that this forum is conducive to transpar-

N Structure of compensation

ent, fair, swift, and decisive decision making. On the other

Officer compensation is comprised of base compensa-

hand, again fiscal 2020 only 70% (approximately) of sur-tion (fixed compensation), annual performance-based

Kito has established a Nomination and Compensation

vey responses gave positive evaluations of items “3”compensation, and shares of stock (transfer-restricted,

N Basic policy for cross-shareholdings

Committee as an advisory body comprised of five(Selection of agenda items) and “4” (Structure supporting

equity-based compensation). Outside directors and

The Company will hold listed shares of its businessdirectors.

the Board of Directors). Although challenges were virtual-auditors entrusted with handling supervisory functions

partners as cross-shareholdings only in the cases

ly unavoidable in fiscal 2020 due to the COVID-19 pan-are paid base compensation only, while taking into

where the holding of said shares, including the num-

tors in order to ensure independence and neutrality. The

demic, the three issues that need to continue being dealt

account their professional duties.

ber of shares to be held, is deemed rational following

Committee deliberates on matters pertaining to the selec-

with, as indicated on the fiscal 2018 and fiscal 2019 effec-

The breakdown of compensation (i.e., the ratios ofcomprehensive consideration of its importance to thetion of candidates for the positions of director, auditor, exec-

tiveness surveys, have not yet been resolved. We haveeach particular type of compensation) weighs perfor-

Company’s business strategies and our business rela-utive officer, and subsidiary officer, in addition to theestablished a shared understanding that these are issues

mance-based compensation more heavily as the recipi-

tionship with the trading partner. The rationality for

dismissal and removal of individuals in these positions. The

to continue to address in fiscal 2021.

ent’s job grade and duties increase, while taking into

holding such shares will be verified on a regular basis.

Committee also deliberates on matters pertaining to the

N Issues to be dealt withaccount a benchmark compensation standard that

Also, as a result of these verifications, our basic policy

includes companies of similar scale in related industries

is to promptly dispose of or reduce the number ofand business categories. The composition of compensa-

cross-shareholdings for which the significance of pos-tion is reviewed by the Nomination and Compensation

session is considered to be weak.

Of the five members, three are selected as outside direc-

compensation of these individuals (not including auditors)
and evaluates the results of the execution of business while
also making recommendations to the Board of Directors.

The Board of Directors has concluded, based on the
results of current evaluations, that the three issues identified in the fiscal 2018 and 2019 effectiveness evaluations need to continue being dealt with. As we formulate

22

the next mid-term management plan, we will continue to

KITO CORPORATION

Committee, then reported to the Board of Directors.
The Board of Directors determines individual

Cross-Shareholdings

As of March 31, 2021, the Company does not possess any cross-shareholdings.
Integrated Report 2021

23

Kito’s Foundation

Data

Directors

Six-Year Financial Highlights (Year ended March 31)

President & CEO

Executive Vice President

Yoshio Kito

Edward W. Hunter

Chief Executive Officer
Chief Product Officer

Co–Chief Market Officer

Attendance at board
meetings

14/14
Number of shares of theCompany held

176,603

Financial Information
N Results of Operations (Consolidated)

Attendance at board
meetings

2017

2018

2019

2020

2021

¥55,821¥51,141¥55,168¥61,238¥58,722¥51,805

77.3

74.3

76.0

73.6

74.2

74.9

Japan

25,41524,03624,886

29,79426,704

21,534The Americas

27,96524,80926,78528,691

28,171

24,013

China

7,870

5,524

6,264

7,185

7,503

7,104

Asia

5,166

4,744

4,681

4,668

3,214

2,934

Europe

1,686

1,390

1,916

3,754

4,578

4,462

Net Sales
Overseas Sales Ratio (%)

Number of shares of theCompany held

Net sales by region

Other*

1

Gross profit
Managing Director

Managing Director

Tsuneo Yuzurihara

Shigeki Osozawa

Senior Executive Officer
Chief Quality Officer
Chief Manufacturing Officer

Senior Executive Officer
Chief Financial Officer(Millions of yen)

2016
14/14

54,648



-

1,356

2,048

1,901

1,464

1,504

20,30918,96819,881

22,545

21,97918,724Gross profit ratio (%)

36.4

37.1

36.0

36.8

37.4

36.1

Operating income

5,221

4,208

4,698

6,413

5,474

4,457

9.4

8.2

8.5

10.5

9.3

8.6

Ordinary income

4,576

3,249

3,791

5,748

4,991

4,550

Net income attributable to owners ofparent

2,497

1,897

2,836

4,064

3,204

2,344

14/14

Capital Expenditures

2,013

2,239

1,607

1,321

2,377

1,833

Number of shares of theCompany held

Depreciation

1,814

1,792

2,116

2,470

2,711

2,697

Return on equity (%)

10.1

8.4

13.2

16.8

12.2

8.3

Number of employees

2,365

2,364

2,169

2,308

2,328

2,262

Cash flow from operating activities¥4,502¥3,981¥7,044¥3,553¥5,374¥6,662

Net cash used in investing activities(3,572)(2,142)(2,191)(1,580)(2,826)(2,300)

930

1,839

4,853

1,973

2,548

4,362

(1,900)(1,148)(3,083)(4,279)(1,671)(82)

Total assets¥60,639¥60,137¥61,854¥62,078¥62,804¥65,067

Net assets

26,04021,23923,697

26,68727,92730,567

Interest-bearing debt

19,281

24,17821,44918,795

18,332

19,877

Shareholders’ equity ratio (%)*2

41.2

33.8

36.7

41.4

42.8

45.4

Debt/equity ratio (Times)

0.74

1.14

0.91

0.7

0.66

0.65

Interest paid

450

397

386

408

356

252

10.0

10.0

18.2

8.7

15.1

26.4

Net assets per share (Yen)*4¥952.43¥1,001.60¥1,114.03¥1,258.34¥1,314.13¥1,439.48

Outside Director

Net income per share (Yen)

95.13

82.38

139.52

199.14156.64114.29Koji Osawa

Cash dividends per share (Yen)

28.00

28.00

33.00

44.00

48.00

30.00

Attendance at board
meetings

14/14
Number of shares of theCompany held

37,093Operating income ratio (%)

Attendance at board
meetings

39,493

N Cash Flows

Outside Director

Outside Director

Katsumi Nakamura

Takashi Hirai

Attendance at board
meetings

Attendance at board
meetings

14/14

14/14

Number of shares of theCompany held

Number of shares of theCompany held

400

Free cash flow
Cash flows from financing activities

N Financial Soundness

7,500

Interest coverage ratio (Times)*

3

N Valuation

Payout ratio (%)*

29.4

34.0

23.7

22.1

30.6

26.2

Price/earnings ratio (Times)*6

8.8

14.4

14.2

8.4

6.4

16.0

Price book value ratio (Times)*7

0.88

1.19

1.78

1.32

0.76

1.27

5

Attendance at board
meetings

14/14

*1 W
 e acquired all the stock of Scaw Metals Pty. Ltd. (currently Kito Australia Pty. Ltd.) in the fiscal year ended March 31, 2017 so that the company and its two
subsidiaries are included in the consolidated figures. Along with the change in the coverage of consolidation, the reportable segment Others has been added.
*2 Net assets applicable to common stock/total assets × 100*3 Cash flow from operating activities/Interest paid
*4 Net assets applicable to common stock/average outstanding shares*5 Cash dividends/net income (consolidated)*6 Stock price (year-end)/EPS*7 Stock price (year-end)/BPS

Number of shares of theCompany held

5,700



24

KITO CORPORATIONAs of March 31, 2021

Integrated Report 2021

25

Data

Data

Corporate Profile (As of March 31, 2021)

Stock Information (As of March 31, 2021)

Company Name

KITO CORPORATION

Stock Code6409

Head Office & Factory

2000, Tsuijiarai, Showa-cho, Nakakoma-gun,
Yamanashi 409-3853, Japan

Date of Listing

August 9, 2007

Tokyo Head Office

SHINJUKU NS Building 9F, 2-4-1, Nishi-Shinjuku, Shinjuku-ku, Tokyo 163-0809, JAPAN
Tel: +81-3-5908-0155

Stock Exchange Listing

Tokyo Stock Exchange, First Section

President & CEO

Yoshio Kito

Total Number of Shares Issued

21,048,200

Established

July 1944 (started Nov. 1932)

Number of Employees

Trading Unit of Shares

100(As of March 31, 2021)

Consolidated: 2,262
Non-consolidated: 677

Number of Shareholders

4,245

Capital¥3,976 million

Net Sales (March 31, 2021)

Consolidated: ¥51,805 million
Non-consolidated: ¥21,534 million

Transfer Agent and Administrator ofSpecial Account

Sumitomo Mitsui Trust Bank, Limited
1-4-1, Marunouchi, Chiyoda-ku, TokyoN Major Domestic Bases
Name of Business Office

N Bases of Major Subsidiaries
Location

Head Office & Factory

Showa-cho, Nakakoma-gun,
YamanashiTokyo Head Office

Shinjuku-ku, Tokyo

Sapporo Sales Group

Sapporo, Hokkaido

Sendai Sales GroupSendai, Miyagi

Kita-Kanto & Shinetsu
Sales Group

Ota, Gunma

Yokohama Sales Group

Yokohama, Kanagawa

Central-Japan Sales Group

Nagoya, Aichi

Osaka Sales Group

Moriguchi, Osaka

Chugoku & Shikoku
Sales Group

Okayama, Okayama

Fukuoka Sales Group

Fukuoka, Fukuoka

Company NameN Major Shareholders (top 10)

Country

Name of shareholders

KITO Americas, Inc.

U.S.A.

MISAKI ENGAGEMENT MASTER FUND

9.96

Harrington Hoists, Inc.

U.S.A.

The Master Trust Bank of Japan, Ltd. (Trust account)

8.69

PEERLESS CHAIN COMPANY

U.S.A.

THE BANK OF NEW YORK-JASDECNON-TREATYACCOUNT

4.84

KITO CANADA INC.

CanadaGOVERNMENT OF NORWAY

4.58

Custody Bank of Japan, Ltd. (Trust account)

4.47

KITO DO BRASIL COMÉRCIO DETALHAS E GUINDASTES LTDA

BrazilKito Europe GmbHGermanyYK Capital Co., Ltd.

3.60

KITO CHAIN ITALIA S.R.L.

Italy

Custody Bank of Japan, Ltd. (Trust account 9)

3.52

ERIKKILA OY

Finland

Sumitomo Mitsui Banking Corporation

3.26

Van Leusden B.V.

Netherlands

RE FUND 107 – CLIENT AC

2.02

JIANGYIN KITO CRANE CO., LTD.

China

Custody Bank of Japan, Ltd. (Securities investment
trust account)

1.99

KITO HOISTS & CRANES(SHANGHAI) CO., LTD.

China

KITO TAIWAN CO., LTD.

TaiwanKITO KOREA CO., LTD.

Korea

SIAM KITO CO., LTD.

ThailandPT. KITO INDONESIA

Indonesia

KITO INDIA PRIVATE LIMITED

Australia

SCC Japan Godo Kaisha

Japan

Treasury stocks

2.51%
Individuals, etc.

Foreign-AffiliatedCorporations andForeigners

40.80%

KITO CORPORATION

vidual shareholders.

https://kito.com/ir/ask

N Shareholders’ Composition by Category

India

PWB ANCHOR LIMITED

We provide prompt responses to questions from indi-

Notes: Share ownership percentages were calculated after the deduction oftreasury shares (528,427 shares).

19.34%

26

N Ask IR Officers!
Percentage ofownership (%)

Financial
Institutions

31.00%
Securities Firms

0.76%
Other Corporations

5.58%

Integrated Report 2021

27