ANNUAL REPORT 2015

NORITAKE CO., LIMITEDYear Ended March 31, 2015

In du st ria l Produ c t s

C e ra mic s & M a t e ria ls

E n gin e e rin g

Ta ble t op
PRINTED IN JAPANProfile

Noritake Co., Limited, including its subsidiaries and associates

C O R P O R AT E D ATA

H I S T O R Y O F N O R I TA K E(As of June 26, 2015)(As of June 26, 2015)

HEAD OFFICE1876 Ichizaemon Morimura established3-1-36, Noritake-Shinmachi(Hereinafter “The Noritake Group”, “The Group” or simply “Noritake”)

Nishi-ku, Nagoya, Aichi

has developed technologies acquired from ceramics manufacturing451-8501, Japan

expertise and has expanded its business into such fields as grinding and polishing tools,

Tel: +81-52-561-7112
Fax: +81-52-561-9721

electronic component materials and manufacturing equipment.
With a focus on developing new products and technologies for energy-related industries—

DATE OF ESTABLISHMENT
January 1904

NUMBER OF EMPLOYEES
5,089 (Consolidated)

STOCK EXCHANGE LISTINGS
New Mid-term Business Plan

Tokyo Stock ExchangeWith the government’s recent economic policies, there were some positive signs in the Japanese economy. Nevertheless,

Nagoya Stock Exchange

Amid these circumstances, the Group launched its 9th Mid-term Business Plan in April 2013. The Plan identifies major
business challenges as being able to respond swiftly to market changes, and constructing a business andin-house use

1914 Succeeded in production of the first
1917 Sanitary ware division spun off to

ADMINISTRATOR OF SHAREHOLDERREGISTRY
Mitsubishi UFJ Trust and Banking
Corporation
4-5, Marunouchi 1-chome,every effort to achieve full recovery and improve our business performance.

Chiyoda-ku, Tokyo(2) Penetrating overseas markets and upgrading overseas manufacturing bases(3) Promoting an efficient management structure and upgrading infrastructure

become NGK Insulators Ltd.
in Japan
grinding wheels

1943 Tableware production stopped on
account of World War II, changed to fullproduction of grinding wheels(only bone china production continued
to preserve technique)the United States

1956 Began production of cutleryware

The annual meeting of shareholders of the1958 Established Noritake (Australia) Pty. Ltd.
in Australia

1960 Began production of resinoid grinding

in Nagoya, Japan.

wheels at the Kamori Plant

In addition, the Company may hold anextraordinary meeting of shareholders

1961 Began production of crystal glassware
Began production of melamine ware

whenever necessary by giving at least two

1962 Began production of grinding machines

weeks’ advance notice to shareholders.

1963 Began production of belt and

INDEPENDENT AUDITORS

1968 Established Noritake Canada Ltd.

fabric abrasives
KPMG AZSA LLC

Began production of materials andequipment for the ceramics industry

1981 Changed the Company name to
Noritake Co., Limited

1987 Established Noritake Europa G.m.b.H.
in Germany

1988 Established Noritake Taipei Co., Ltd. in
Taiwan1992 Established Noritake Singapore Pte. Ltd.

ANNUAL MEETING OF
SHAREHOLDERS
Company is normally held in June each year

1979 Began operation of the Craft Center

Established Nippon Toki Co., Ltd.

1919 Electric insulator division spun off to1947 Established Noritake Co., Inc. in(1) Boosting sales by competitively pricing new technologies and products

Inc. in the Philippines

1991 Established Noritake Hong Kong Ltd.

1945 Production of tableware resumed

100-8212, Japan

1974 Established Noritake Porcelana Mfg.,

become TOTO Ltd.

1939 Began full-scale production of industrial

management structure capable of achieving stable growth amid increasingly intense global competition. We will makeThe basic strategies of the 9th Mid-term Business Plan are as follows:1907 Began production of grinding wheels for1932 Began production of first bone china

the business environment is predicted to remain severe due to such concerns as slowing growth in China and otheremerging countries, as well as uncertainty in Europe.

1904 Established Nippon Toki Gomei Kaisha

dinner set in Japan

including solar cells, an area of promising growth—
Noritake seeks to create new value for customers and society.

Morimura-kumi in Tokyo, and Toyo
Morimura and others establishedthe Hinode Shokai (Morimura Brothers)
in New Yorkin Canada

1969 Began production of electronic products
1970 Established Noritake (U.K.) Ltd. in the
United Kingdom
Began production of fine ceramic industrial products

1971 Began production of filtration equipment
1972 Established Noritake Lanka Porcelain(Private) Ltd. in Sri Lanka

1973 Began production of diamond tools

1993 Opened the Noritake Gallery
1995 Established Pt. Noritake Indonesia
1996 Established Noritake (Siam) Co., Ltd. in
Thailand1997 Established Itron (U.K.) Ltd. in
the United Kingdom

1998 Established Noritake Dental Supply Co.,
Limited.

2001 Established Noritake Gypsum Co., Ltd.
Opened the Noritake Garden

2002 Established Noritake Bonded
Abrasive Co., Ltd.

2005 Established Noritake Shanghai Trading
Co., Ltd.

2009 Made Nippon Resibon Corporation its
associate by acquiring additional sharesof the stock of the company.
Absorbed Noritake Engineering Co.,
Ltd., Noritake China Mfg. Co., Limited,
Noritake Tableware Co., Ltd. and Tokyo
Toishi Co., Ltd.

2010 Absorbed Noritake Kizai Co., Ltd. and
Noritake Ceramics Co., Ltd.

2011 Absorbed Noritake Bonded Abrasive
Co., Ltd. and Noritake Super Abrasive
Co., Ltd.
Established Noritake SA (Thailand) Co.,
Ltd. in Thailand

2012 Made KCM Corporation its wholly-owned
subsidiary via a stock swap
Established Noritake Abrasives (Suzhou)Co., Ltd. in China

2014 Made Nippon Resibon Corporation its
consolidated subsidiary by acquiring
additional shares through a tender offer

Contents
1 Six-Year Financial Summary
12 Corporate Governance

2 Message from the Management

14 Consolidated Financial Review

5 Review of Operations

20 Consolidated Statements of Income / Consolidated Statements of Comprehensive Income
24 Consolidated Statements of Cash Flows

9 Topics

17 Report of Independent Auditors

10 Research & Development

18 Consolidated Balance Sheets

22 Consolidated Statements of Changes in Net Assets

25 Notes to Consolidated Financial Statements

56 Overseas Network / Directors, Corporate Auditors and Executive Officers

Caution with respect to forward-looking statements
This annual report includes forward-looking statements pertaining to expectations, plans, strategies, management goals, future performance,
expenses, revenues, income and other forecasts formulated on past experiences. Forward-looking statements necessarily entail some degree of
uncertainty, and the content conveyed in the results as well as underlying factors identified in the report may differ materially from actual results
depending on changes in those factors.

57 Corporate Data / History of Noritake
NORITAKE CO., LIMITED

Annual Report 201557

S I X - Y E A R F I N A N C I A L S U M M A RY

Millions of yen

Thousands of
U.S. dollars

2015

2015

2014

2013

2012

2011

2010

¥ 99,038¥ 88,687¥ 90,236¥102,152¥105,378¥ 87,596

Operating income (loss)

2,191

785

64

1,880

4,326

(1,665)

18,258

Income (loss) before income
taxes and minority interests

3,100

2,485

2,693

5,972

3,703

(3,354)25,833

Net income (loss)

2,060

1,313

1,644

4,468

1,858

(4,501)

17,167

13.16¥ (31.32)$

For the year:
Net sales

Net income (loss) per share(yen/U.S. dollars)

¥

14.34

¥

8.91

¥

11.02

¥

31.99

¥

$

825,317

0.12

At year-end:
Total assets¥145,837¥118,774¥114,419¥117,735¥116,126¥109,595$ 1,215,308

Total net assets

82,817

69,217

66,58068,89665,42966,711

690,142

Capital ratio (%)

54.1

57.8

57.7

51.5

49.5

54.2

54.1

Note: The U.S. dollar amounts above have been translated at the rate of ¥120 to US$1.

Net Sales

Operating Income

Net Income

Net Income per Share(Millions of yen)

(Millions of yen)

(Millions of yen)

(Yen)

2,191

102,152

31.99

4,468

99,03890,236 88,687

1,880

2,060

14.34

1,644

785

11.02
1,313

8.91

64

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NORITAKE CO., LIMITED’15

Annual Report 2015

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1

MESSAGE FROM THE MANAGEMENT

The management of Noritake Co., Limited wishes to express its gratitude to all stakeholders fortheir continued support. We would like to take this opportunity to comment on the Group’s
results for fiscal 2015, ended March 31, 2015.

2

Hitoshi Tanemura

Tadashi Ogura

Chairman &Representative Director

President &Representative Director

NORITAKE CO., LIMITED

Annual Report 2015

Performance Overview for Fiscal 2015
In the first half of fiscal 2015, sales of domestic motor vehicles and other products fell as
consumption cooled amid recoil from the last-minute surge in demand before the April
2014 consumption tax increase. Afterwards, the outlook grew brighter for the Japanese
economy as the unemployment rate fell, the yen weakened and share prices rose due tothe government’s economic policies. However, the pace of recovery is still gradual and,except for a certain few companies in the manufacturing industry, most companies have
yet to feel the effects of recovery.
In the United States, the economy continued to recover due in part to improved auto
sales and employment conditions. In Europe, however, the economy continued to stagnate due in part to the turmoil in Ukraine and the reignited debt crisis in Greece. In
emerging markets, Chinese economic growth slowed and there were no signs of fullscale recovery in Thailand.
Amid this economic environment, the Noritake Group as a whole continued to focus
its efforts on the key initiatives outlined in the 9th Mid-term Business Plan during its
second year: developing new technologies and products, penetrating overseas markets
and upgrading overseas manufacturing bases, and promoting an efficient management
structure and upgrading infrastructure.
As a result, net sales rose 11.7% year on year to ¥99,038 million thanks in part to thecontribution of ¥8,660 million in net sales from Nippon Resibon Corporation, which wasmade a consolidated subsidiary in the second half of fiscal 2015. Looking at earnings,
operating income rose to ¥2,191 million and ordinary income amounted to ¥3,389 million on the back of increased profitability for exports amid the weak yen, though this waspartially offset by the increasing cost of energy and imported raw materials.
In regards to the development of new technologies and products and the expansion ofsales, both nickel pastes used in multilayer ceramic capacitors for automobiles and rotary kilns used to make lithium-ion batteries, and concrete blades received praise in themarket, and sales proceeded smoothly. We will maintain efforts to expand sales. In
regards to penetrating overseas markets and upgrading overseas manufacturing bases,
the grinding wheel plant in China was impacted by a delay in manufacturing permits but
was able to steadily raise its operating capacity in the second half. The cubic boron
nitride (CBN) grinding wheel plant in North America raised its competitiveness andboosted net sales by shifting to integrated production. In Thailand, we began manufacturing CBN grinding wheels in addition to electroplated tools. Sales were firm for new
products for construction materials that began shipments. We were able to continue
moving production of thick film circuit substrate from Japan to the plant in Indonesia

NORITAKE CO., LIMITED

Annual Report 20153

according to plan.
In regards to enhancing management infrastructure, we worked to strengthen
manufacturing at production sites and began efforts to improve operational quality atback-office sections. We also worked to reinforce our business management structure,
improving efficiency, while pursuing stronger manufacturing; labor health and safety;
compliance; and environmental management across the entire Group. We are still
considering how we plan to use the former site of the headquarters’ plant.

Basic Policy Regarding Earnings Distribution
Noritake has positioned returning profit to shareholders as a key management policy.
Based on this policy, we place emphasis on stable dividend payments over the longterm and the distribution of earnings by comprehensively taking into consideration
factors that include performance results, financial conditions and future business development. In addition, we make effective use of retained earnings for investment aimed atcreating new technologies and products that can become a foundation for the Noritake
Group’s future strength, as well as for investment for sustainable business developmentin growth fields. With regard to dividend payments, Noritake distributed ¥3.0 per shareas the fiscal year-end dividend. Combined with the interim dividend, this brought the
full-year dividend to ¥6.0 per share.
Through the concerted and unified efforts of the Noritake Group to swiftly implement
the 9th Mid-term Business Plan’s core strategies, Noritake aims to establish a growthtrajectory responsive to changing times.

We ask for the continued understanding and steadfast support of our stakeholders.

Hitoshi Tanemura
Chairman & Representative Director

Tadashi Ogura
President & Representative Director

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NORITAKE CO., LIMITED

Annual Report 2015

R E V I E W O F O P E R AT I O N S

Diamond Blade for Cutting Concrete

Breakdown of Sales

Business Statusn Japan, while production remained firm inI

n Japan, we are still working hard toI

the steel and bearing industries—our main

promote the development of higher perfor-

customers—the recovery for automobile-

related parts was delayed as automobile production declined due to the effects of theBusiness Strategy

mance processing tools in the advanced

47.6

%

field of LEDs and the growth fields of aircraft
and medical applications. Overseas, we willconsumption tax increase. As a result, net sales

continue to set up a local production systemincreased only slightly. Overseas, despite acomprising the plants in Thailand, China anddecrease in net sales in Thailand, automobile
production remained strong in the United

Sales(Millions of yen)

States, and sales for the steel and automobile

47,204industries expanded in China. Coupled with the
weak yen, net sales increased. In the second

the United States. We aim to use these plants
as bases from which to expand sales andpenetrate overseas markets. In addition, we will
combine our resources with those of Nippon
Resibon Corporation, which was made a

36,738half of the year, Nippon Resibon Corporation,

consolidated subsidiary, and solidify our allianceincluding its subsidiaries, was made a consoli-

to establish a firm position in the industry.

dated subsidiary. As a result, consolidated net
sales of the Industrial Products Group grew
28.5% year on year to ¥47,204 million.
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NORITAKE CO., LIMITED

Annual Report 2015

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5

Ceramics & Materials

Vacuum Tube for Playing Music/
Audio Equipment “Nutube”

Business Status

S

Breakdown of Sales

ales of electronic pastes fell slightly

to collaborate with our customers to develop

in solar cells, which could not be

multilayer ceramic capacitors and sensors

In regards to electronic pastes, we are striving

due to a slump in shipments for use

offset by an increase in shipments for use in

Business Strategy

products and working to secure customers

30.7

%

and expand sales for use in multi-layer ceramic
capacitors, solar cells and various sensors used infor automobiles. Sales of gypsum expand-automobiles. As for ceramic products, we aim toed, especially shipments to China. Sales of

expand sales of gypsum in the Asian market andthick film circuit substrates for automobiles
did not pick up in the second half of theyear. Orders of vacuum fluorescent displays

Sales

sales of thick film circuit substrates in LEDs and(Millions of yen)other new markets. Turning to vacuum fluorescent

30,422

displays (VFDs), we will promote the development

29,506(VFDs) increased only marginally both inof new products, including module products andJapan and overseas. KCM Corporation’s

touch switches, and work to expand their sales.

sales increased with healthy exports of bothKCM Corporation is striving to expand its market-

ceramic materials and electronic ceramicshare of materials for use in multi-layer ceramicmaterials. As a result, consolidated net

capacitors and working hard to develop products

sales of the Ceramics & Materials Group

aimed at new applications, including those forgrew 3.1% year on year to ¥30,422 million.

fuel cells.
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NORITAKE CO., LIMITED

Annual Report 2015

Engineering

Water Heating System

Breakdown of Sales

Business Status

S

ales of mainstay dry-furnaces andkilns fell considerably due to weaksales for use in electronic compo-

nents despite an increase in sales for use inlithium-ion batteries. Sales of filtration and

12.0

%

Business StrategyIn dry-furnaces and kilns, we aim to expand
sales for those used in making electronic
components and lithium-ion batteries, twoareas where demand is recovering, anddevelop products for automobile-related

mixing equipment increased due to a recovery

fields. For filtration and mixing equipment as

in sales for use in bearings in the first half ofwell as carbide tipped circular sawing

the year and new applications for use in foodSalesmachines, we aim to improve performance

products for mixing equipment. Sales of(Millions of yen)and functionality while opening new sales

carbide tipped circular sawing machines fell

12,962channels in Japan and markets overseas,
11,847due to weak demand overseas despite anincrease in sales for use in automobile parts inincluding the rest of Asia and North America,and breaking into new fields.

Japan. As a result, consolidated net sales of
the Engineering Group declined 8.6% year on
year to ¥11,847 million.

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NORITAKE CO., LIMITED

Annual Report 2015’15
7

Tabletop

KIRA KARACHO×NORITAKE“KAKU TSUNAGI”

Business Status

Breakdown of Salesn Japan, sales declined due to weak sales

In Japan, we reinforce our brand power byI

to hotels and restaurants in addition toreleasing high-priced products and place

continued stagnation at department stores

attributable to the effects of the consumption
tax increase. Turning overseas to Europe,

Business Strategy

importance on developing high-quality

9.7%

everyday tableware. We are continuing todevelop new sales channels, including online

shipments to Russia declined due in part tosales. In addition, we are strengthening

effects from the unrest in Ukraine. In themarketing activities at department stores andUnited States, sales at department storesSales

remained firm, and in Asia, sales rose due to(Millions of yen)

the effects of the weak yen in addition to

9,481

9,565

our directly operated stores to decisively
capture demand from the increasing numberof international visitors to Japan. Overseas,

expanded sales to general consumers in

we aim to increase sales and strive to expand

China, Taiwan and South Korea. As a result,

our market share in developed countries,

consolidated net sales in the Tabletop Groupespecially those in North America, by releas-rose 0.9% year on year to ¥9,565 million.

ing new products suited to the needs of themarket. We are also enhancing our marketing
structure for the wealthy population of China,
India and other emerging countries.
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NORITAKE CO., LIMITED

Annual Report 2015

TOPICS

1.

General-Purpose Grinding Wheel Maker Nippon Resibon
Corporation Now a Consolidated Subsidiary
In December 2014, Noritake added Nippon Resibon Corporation to its Group.
Nippon Resibon manufactures and sells general-purpose grinding wheels that areused in electric power tools, such as hand grinders. The RESIBON brand isrenowned in Japan, boasting the top market share for offset grinding wheels.
Nippon Resibon has also expanded outside Japan, setting up a factory in Thailand
nearly 30 years ago. The company now performs over two thirds of its total production overseas and sells products all over the world.
Nippon Resibon was founded in 1958. It jointly established a sales company with
Noritake in 1973, building good rapport between the companies. By uniting
Noritake, which prides itself on its order-made grinding wheels for major customers,
and Nippon Resibon, which focuses on general-purpose grinding wheels, we cangenerate an array of complementary synergies. This will enable the Noritake Groupto enhance its presence in the global grinding wheel market.

Nippon Resibon’s Pinthong Factory in Thailand

2.

Introducing the Masterpiece Collection 2014
We launched Masterpiece Collection 2014, the second offering in our Masterpiece
Collection, offering a total of nine products. This collection was crafted by leveraging
the technology and skill cultivated since our founding. The first offering waslaunched in 2011 with two types of tea sets. For this second offering, we spent over
two years from inception crafting a variety of interior design products, such as vases
and framed porcelain paintings. Ceramic artist Fumio Shimada, a professor at Tokyo
University of the Arts, created the original designs. We then used a variety of techniques to express the concept of natural abundance. The result beautifully harmonizes the gentleness of the underlying sketch with the radiance of the overlaid painting.
Masterpiece Collection 2014

3.

Jointly Developed Vacuum Tubes for Music andAudio Equipment with KORG
We developed Nutube, a vacuum tube for use in guitar amplifiers, audio equipment
and other products, with musical instrument maker KORG Inc., known by their
KORG brand. Nutube uses the same principle as our vacuum fluorescent displays(VFDs). With Nutube, we have succeeded in improving the energy efficiency,
decreasing the size and raising the quality of vacuum tubes compared to existingproducts. Vacuum tubes for musical instruments are becoming increasingly scarcein recent years as they are replaced by transistors and digital systems with excellent
performance. Nevertheless, the unique rich sound quality of vacuum tubes enjoys
unshakable popularity even now, and expectations for Nutube are rising.

Nutube4.

Noritake Garden’s Welcome Center Has Reopened
The Welcome Center of the Noritake Garden is a place where visitors can learn
about the ceramic industry on the grounds of Noritake’s headquarters. In March
2015, it reopened after enhancing the content of its exhibits. The new and improved
Welcome Center uses display panels, actual products and videos to regale visitorswith the history of Noritake and its current businesses, which grew out of tablewaremanufacturing.
The Welcome Center at the Noritake Garden
NORITAKE CO., LIMITED

Annual Report 2015

9

RESEARCH & DEVELOPMENTThe R&D activities of the Noritake Group primarily revolve

Industrial Products

around the Research and Development Center, which is principally involved in basic research, and the Products Development
Center, which promotes the commercialization of projects thatare directly connected to the business divisions. Noritake carries
out product development for new technologies and new fields incollaboration with each business division and Group company.
The R&D expenditures of the Noritake Group amounted to

Diamond Blade for Cutting Concrete¥2,971 million in the fiscal year under review.

R&D Expenditure(Millions of yen)To respond to expanding sectors
and market changes, Noritake
has been focusing its efforts onstrengthening its development capabili-

2,971

2,918
2,724

ties by relying on basic technologies
and developing differentiated products.
Noritake is augmenting the development of ecologically friendly processing
tools in such growth areas as solar cells
and LEDs. In the transportation equipment field (which includes automobiles,
railways and aircraft), and also in the

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medical field, we are promoting thedevelopment of higher performance,
lower-cost products with the aim of

R&D for New Products and Technologies
Noritake focuses on developing new products by utilizing its materials,
calcination and fabrication technologies, while augmenting and expanding the applications of such technologies. Noritake actively promotes

addressing market changes.
The R&D expenditures in the Industrial
Products segment totaled ¥598 million
in the fiscal year under review.

joint R&D and technological exchanges with outside companies, universities and research institutions. At the same time, we participate in government projects and other related activities. Through these initiatives,
each Noritake business segment works in unison to undertake strategic
R&D with a long-term perspective.
Core basic R&D expenditures totaled ¥803 million.

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NORITAKE CO., LIMITED

Annual Report 2015

Ceramics & Materials

Engineering

Tabletop

KIRA KARACHO×NORITAKE

Vacuum Tube for Playing Music/
Audio Equipment “Nutube”

n electronic materials, the Ceramics &Materials segment focuses on thedevelopment and commercialization ofelectrode paste for solar cells that feature
high-generation efficiency. In addition, weare developing insulating and electrodepastes for ceramic substrates used inLEDs as well as electrode pastes forelectronic components installed in smartphones and tablet PCs.
In ceramics, we developed andI“KAKU TSUNAGI”

Water Heating SystemThe Engineering segment
conducts research into
products and equipment for

future growth fields that include
semiconductors, electronics andautomotive products.
The R&D expenditures in thisT

he Tabletop segment continues to work to develop
new decorating technology

and porcelain materials.
The R&D expenditures in thissegment totaled ¥49 million in fiscal
2015.

segment amounted to ¥121 million.

promoted the ongoing marketing of highperformance ceramic catalyst carriers forchemical plants and thick-film, multi-layer
substrates for automobiles and LEDs. We
also developed “°C Monarc”, a ceramiccore used in precision casting that features superior heat resistance.
KCM Corporation is advancing thedevelopment of particulate material
compounds for use in the growth field of
multilayer ceramic capacitors, zirconium
materials, high-purity silica and materials
used in fuel cells. Moreover, in VFD tubes
and VFD module products, we are
currently developing VFD message displays, mainly used in stores, information
and reception displays in public places,and disaster-related wireless systems.
The R&D expenditures in this segment
were ¥1,398 million.

NORITAKE CO., LIMITED

Annual Report 201511

C O R P O R AT E G O V E R N A N C E(1) CORPORATE GOVERNANCE STRUCTURE(iii) Status of internal control system upgrades(i) Overview of corporate governance structure

Since fiscal 2008, the Noritake Group has been working to build andComprising its corporate governance structure, Noritake has posi-

maintain a framework in which it forms project-based structures,

tioned the Board of Directors as the body that decides on important

advances the documentation of adherence to rules and operational pro-matters, including those stipulated by management’s basic policy andcesses, and addresses the systemization of internal controls related to

the law. Noritake has also introduced an executive officer system tofinancial reporting. Furthermore, with regard to the stipulation of internalclarify executive responsibilities and to delegate authority with the objec-

control rules, and the status of their maintenance and implementation,

tive of further reinforcing the execution of business based on decisions

Noritake conducts monitoring from the perspective of the risk of materi-made by the Board of Directors. In addition to executive officers involved

al misstatements related to financial reporting, among other measures,in business operations, the Board of Directors meets, in principle, once a

as it strives to preserve and improve its internal control system.

month to ensure uniformity of understanding across the entire Group.

Through the Compliance Committee and the activities of persons

Furthermore, such matters as surplus dividends and items stipulated inappointed to have compliance responsibilities under the committee’s

Article 459-1 of the Company Law are addressed as matters for resolu-

authority, the Company is working to bolster its internal controls systemtion by the Board of Directors, unless otherwise stipulated by law, withfrom the compliance standpoint.

the aim of being able to flexibly return profits to shareholders.
With regard to important management matters, Noritake has estab-

Furthermore, at the Board of Directors’ meeting held on May 12 ,2015, Noritake resolved to revise its basic policy on establishing anlished a structure to perform accurate and quick decisions after carefulinternal controls system. The main revisions were to adopt clear, con-deliberation at the Executive Council, which meets weekly, in principle.

crete terms in describing the system to ensure the appropriateness of

Directors are elected at the Company’s Annual General Meeting of

the Group’s operations and audit system, in line with a reassessment of

Shareholders, which is attended by at least one-third of the sharehold-the Group’s current needs, as well as revisions to laws and regulations.

ers with exercisable voting rights, and after a majority of said voting(iv) Status of risk management system upgrades

rights is obtained, although not by cumulative voting. Noritake limits theStrengthening the ongoing compliance structure of the Group as anumber of directors to 18. The tenure of directors at Noritake and thewhole, Noritake works to maintain risk management systems to pre-Group has been set at one year. The purpose of this system is to makevent the Group from entering into a crisis situation due to misconductpossible the active building of a management structure optimally suitedassociated with the violation of the law.

to today’s turbulent business environment and to clarify management
responsibilities anew with each fiscal year.
In accordance with Article 426-1 of the Company Law and by

Should the Group be faced with any risk that might damage its corporate value, such as a case of misconduct, an accident or disaster,“Risk Management Regulations” have been formulated to minimize

Board of Directors’ meeting resolution, Noritake decided that it would

losses and to enable operations to continue with minimal disruption. In

be able to exempt directors and auditors (including former directors

the event that a crisis does arise, a task force will be established inand auditors) from liabilities for damages incurred as a result of the exe-

immediate response.

cution of their duties, within the limit of laws and regulations, with theaim of having them fully perform the roles expected of them by the
Board of Directors and auditors.
Noritake aims to affect smooth operations by reducing the quorum
necessary for extraordinary resolutions at the General Meeting of
Shareholders. Resolutions proposed for approval at the Company’s
Annual General Meeting of Shareholders, in accordance with the provisions of Article 309-2 of the Company Law, must be ratified by a twothirds majority vote of shareholders in attendance whose total voting
rights account for one-third or more of all exercisable voting rights.
Although the establishment of other governance structures (e.g.
“company with committees” and “company with a Supervisory & Audit
Committee”) is recognized, Noritake decided to use a corporate auditor
system.
(ii) Reasons for applying corporate governance system
With the advancing globalization of business, the effects of corporate
activities are being held to increasingly strict standards of corporatesocial responsibility. Each Group executive and employee is heir to thespirit of Noritake’s founder, on which basis the Noritake Group Statement ofCorporate Ethics was formulated. In observing and putting that statement
into practice, they apply this corporate governance structure to realize a(2) STATUS OF INTERNAL AUDITS AND AUDITS BYCORPORATE AUDITORS AND INDEPENDENT AUDITORSThe Audit Office serves as the Company’s internal audit department
and implements operational and accounting audits. Audit results arereported to the divisional head and the general manager in charge ofbusiness operations, and, in the event that any significant problems are
identified, the Audit Office is required to notify the Executive Council.
The Board of Auditors is composed of two full-time corporate auditors and two outside auditors. Besides stipulating such matters as audit
guidelines and the division of duties, the Board of Auditors receives
reports from each auditor providing the actual audit status and results,
and expedites the flow of information between the Board of Directors
and the Audit Office, which serves as the internal audit department. In
addition to working to gather information, auditors attend meetings of theBoard of Directors and Executive Council as well as other important
meetings, where they receive status reports on the execution of executives’ duties and ask for explanations when the need arises. Furthermore,
the Board of Auditors, in addition to confirming that Noritake’s accounting auditors maintain their independence and implement the appropriate
audits, receives status reports from the accounting auditors on the execution of duties and requests explanations when the need arises.

Noritake Group with even higher standards of corporate ethics.
12

NORITAKE CO., LIMITED

Annual Report 2015

In the Audit Office, auditors and accounting auditors work in close col-With regard to management and decision-making functions as welllaboration to maintain the effectiveness of internal audit implementation.

as its Board of Directors, which fulfills the management oversight func-

As established by contractual ties, Noritake’s independent auditor istion in terms of the business execution of its directors, Noritake

KPMG AZSA LLC, which assigns managing partners to Noritake tostrengthens management oversight by having two of four auditors from

implement audits from an independent perspective. In the fiscal year

outside the Company. In corporate governance, Noritake places theunder review, the managing partners assigned to Noritake by KPMG

utmost importance on external, objective and neutral management

AZSA LLC were as follows:

oversight functions. The external management oversight function is• Specified employees and managing partners

adequately performed by the system that is in place with the two out-

CPA Yasushi Yokoi

side auditors. Noritake has appointed two outside directors to further

CPA Chika Matsumoto

secure the oversight function of the Board of Directors as well as

CPA Satoshi Zengame

ensure transparency in the decision-making process.

• Assistants
13 CPAs and 14 others(3) OUTSIDE DIRECTORS AND AUDITORS
Noritake has two outside directors and two outside auditors.
No personal, capital or business relationships or other conflicts ofinterest exist between Noritake, its outside auditors Yasumasa Gomi

(4) COMPENSATION TO DIRECTORS AND AUDITORS(i) Total executive compensation by executive officer category,
total compensation by type, and number of officers eligible
Executive
Officer
Category

Compensation
Amount(Millions of yen)

Total Compensation by Type(Millions of yen)
Basic
Stock
Compensation Options

and Kazutoyo Shinohara, who were in office for the fiscal year under

No. ofOfficers
Eligible

Contribution Retirement
Benefits

review, and its outside directors Kosaku Yamada and Tetsuo Komori.

Director (excl.
outside director)

302

236

—

—

65

9

The outside director has a wealth of experience and broad insight

Auditor (excl. outside auditors)

40

32

—

—

8

2

Outside director
and auditor

26

24

—

—

2

3

regarding business management and was hired to provide thoroughcounsel on matters spanning the entire business to the Board of
Directors in an effort to strengthen oversight and increase transparency
in the decision-making process.
Furthermore, the outside auditors reflect their wealth of experienceand broad insight as business managers in Noritake audits.
When the outside director oversees business operations or when theoutside auditors conduct operational audits, they may conduct internal andcorporate audits as needed in addition to collaborating with accounting
auditors and the internal control department through such means as
the appropriate sharing of information and exchange of opinions.
Together with the two full-time corporate auditors, the outside auditors are mandated to audit the Board of Directors in the execution of its(ii) Policy details and decision-making process with regard to
executive compensation and its methods of calculation
At the 109th Annual General Meeting of Shareholders, which was heldon June 28, 1990, the decision was taken to limit Noritake’s total executive compensation to ¥40 million or less per month for directors and¥6 million or less per month for auditors.

(5) DETAILS OF COMPENSATION PAID TO INDEPENDENTAUDITOR, ETC.
(i) Details of independent auditor compensation, etc.
Category

duties and the operations and assets of Noritake and its subsidiaries. In

Previous Consolidated
Accounting Year

Consolidated Accounting
Year under Review

Compensation
Compensation
Compensation
Compensation
Based on Audit
Based on Non- Based on Audit
Based on NonCertification Services Auditing Services Certification Services Auditing Services(Millions of yen)
(Millions of yen)
(Millions of yen)
(Millions of yen)addition, the outside auditors conduct audits based on reports
received from the independent accounting auditors regarding theCompany’s consolidated financial statements. In addition, working

Parent company

59

—

59

—

closely with the Audit Office, the outside auditors contribute to efficient

Consolidated
subsidiary

8

—

23

—

Total

67

—

82

—

internal audits.
The Company appoints outside directors and auditors with the
expectation that they will perform their oversight duties and audits in an(ii) Other significant details regarding compensation

appropriate and objective manner based on their specialized knowl-

Noritake Co., Inc., a Noritake subsidiary, paid compensation based onedge. Although the Company’s rules and regulations do not stipulate

audit certification services of ¥8 million to KPMG LLP, which belongs to

the independence of outside directors and auditors, we appoint themthe same corporate network as the Company’s independent auditor, inin line with our basic philosophy that they have no conflict of interest

the consolidated accounting year under review. In the previous consolidat-

with ordinary shareholders.

ed accounting year, the amount for such services had totaled ¥7 million.

The Company concludes limitation of liability contracts with eachoutside director and auditor in accordance with the provisions of Article(iii) Details of non-auditing services provided to the Company by
the independent auditor

423-1 of the Company Law. As such, the maximum amount of liability

In the year ended March 31, 2015, there were no relevant items.

stipulated by the aforementioned contracts is the minimum amount(iv) Policy for determining compensation to independent auditors

determined by law.

The Company calculates compensation to be paid to its CPAs, etc. taking into account such factors as the number of days of the audit and thespecial characteristics of Noritake’s size and operational characteristics.

NORITAKE CO., LIMITED

Annual Report 201513

C O N S O L I D AT E D F I N A N C I A L R E V I E W

Net Sales &Overseas Sales Ratio
Net sales (Millions of yen)Overseas sales ratio (%)

99,03890,236

88,687

34.5

34.7

’13

’14

37.0

’15

Ordinary Income

Ordinary income (Millions of yen)

3,389

1,930

1,144

’13

’14

’15

Net Income &Net Income Ratio
Net income (Millions of yen)
Net income ratio (%)
2,059

1,644
1,313
2.1
1.8

’13

14

1.5

’14

SCOPE OF CONSOLIDATION
Composed of 25 subsidiaries and 7 associates,
the Noritake Group is engaged in the manufactureand sale of products in four business segments—
Industrial Products, Ceramics & Materials,
Engineering, and Tabletop—as well as the provision of services related to these segments.
INDUSTRIAL PRODUCTS SEGMENT
In the Industrial Products Segment, grinding
wheel manufacturing and fabrication are performed by five subsidiaries and two associates
in addition to the Company, while diamond tool
manufacturing is undertaken by one subsidiaryin addition to the Company. Coated abrasives
are produced by the subsidiary Noritake CoatedAbrasive Co., Ltd. and one associate; a portionof these items are supplied to the Company.
In addition to the Company’s and one subsidiary’s sales activities in Japan and overseas,
the Industrial Products Segment’s domestic
sales are handled by Zen Noritake Co., Ltd. andone other subsidiary. The U.S.-based Noritake
Co., Inc. and three other subsidiaries undertake
sales in overseas markets. Noritake CoatedAbrasive Co., Ltd. conducts direct sales of mostof these products both in Japan and overseas.
CERAMICS & MATERIALS SEGMENT
In the Ceramics & Materials Group, manufacturing of electronic paste and thick film circuit substrates is conducted by the Company. Such
activities are bolstered by P.T. Noritake
Indonesia along with one subsidiary and one
associate. VFD tubes are produced and supplied to the Company by the subsidiary Noritake
Itron Corporation. In addition, the subsidiary
KCM Corporation and its subsidiaries produce
ceramic raw materials, a portion of which aresupplied to the Company.
In addition to the Company’s own sales
activities for electronic paste and other ceramic
products of the Ceramics & Materials Group,sales activities for VFD tubes and related products, both domestic and overseas, are mainly
conducted by the integrated manufacturing andsales subsidiary Noritake Itron Corporation.

In addition, the U.S.-based Noritake Co., Inc.
and three other subsidiaries conduct sales for
the Ceramics & Materials Group in overseas
markets. KCM Corporation undertakes direct
sales of most of its own products both in Japanand overseas.
Moreover, the Company’s associate, Kuraray
Noritake Dental Inc., engages in the manufacture and sale of dental-related products.
ENGINEERING SEGMENT
In the Engineering Segment, the Company manufactures segment products. Various types ofindustrial furnaces are produced and supplied to
the Company by the subsidiary Noritake TCF
Co., Ltd. The Company’s Taiwanese subsidiary
Noritake Taipei Co., Ltd. manufactures and supplies to the Company static mixers.
Sales activities in Japan and overseas areundertaken by the Company and one of its subsidiaries. In addition, the U.S.-based Noritake
Co., Inc. and another subsidiary conduct sales
for the Engineering Segment in overseas markets.
TABLETOP SEGMENT
In the Tabletop Segment, in addition to theCompany’s production activities, porcelain tableware is manufactured by Noritake Lanka
Porcelain (Private) Limited located in Sri Lanka
and one associate, which is supplied to theCompany.
The Company conducts sales for the
Tabletop Segment in the domestic and overseas
markets. In addition, the U.S.-based Noritake
Co., Inc. and four other subsidiaries undertake
sales in overseas markets.
Service operations in other areas are handled
by Noritake Garden Co., Limited and one
associate.
PERFORMANCE ANALYSIS
Consolidated net sales grew ¥10,351 million, or
11.7%, year on year to ¥99,038 million.
Ordinary income increased ¥1,459 million
from the previous fiscal year to ¥3,389 million
mostly due to the depreciation of the yen.

’15

NORITAKE CO., LIMITED

Annual Report 2015

Other income totaled ¥1,474 million, withgain on step acquisitions amounting to ¥77 million. Other expenses came to ¥565 million, withloss on sales or disposals of property andequipment totaling ¥333 million.
As a result of the aforementioned, income
before income taxes and minority interests forthe fiscal year under review amounted to ¥3,100
million. After accounting for income taxes andminority interests, net income totaled ¥2,060
million.
Additionally, net income per share increasedto ¥14.34 and the return on equity rose from 2.0%
in the previous consolidated fiscal year to 2.8%.
FINANCIAL POSITION ANALYSIS
Total assets stood at ¥145,837 million, up
22.8%, or ¥27,063 million, from the previous fiscal year-end. Current assets totaled ¥61,354
million, up ¥10,847 million, while non-current
assets amounted to ¥84,483 million, up¥16,216 million. Major factors contributing to
the growth of total assets included bringing
Nippon Resibon Corporation into the scope of
consolidation, which contributed to other factors(an increase in cash and time deposits, anincrease in notes and accounts receivable, anincrease in property, plant and equipment), as
well as rising share prices that increased themarket value of investment securities.
Total liabilities as of March 31, 2015 stood at¥63,020 million, an increase of 27.2% year on
year, or ¥13,463 million. This change was primarily attributable to the inclusion of Nippon
Resibon Corporation in the scope of consolidation, which also contributed to the increase innotes and accounts payable and an increase inlong-term debt, as well as an increase indeferred tax liabilities due to an increase in unrealized gains on available-for-sale securities.
Total net assets at March 31, 2015 amounted to ¥82,817 million, up 19.6% year on year, or¥13,600 million. Major factors include the additionof Nippon Resibon Corporation to the scope of
consolidation, as well as increases in minority
interests, unrealized gains on available-for-salesecurities, and foreign currency translation

NORITAKE CO., LIMITED

Annual Report 2015

adjustments. As a result, shareholders’ equity
per share totaled ¥549.59, up ¥71.95 comparedwith the previous consolidated fiscal year-end.
The capital ratio fell to 54.1% from 57.8% at theprevious fiscal year-end.
CASH FLOW ANALYSISAs of March 31, 2015, cash and cash equivalents stood at ¥10,586 million, a year on year
increase of ¥1,915 million. For the year, negative
free cash flows amounted to ¥1,216 million.
Net cash provided by operating activities
increased ¥188 million year on year to ¥5,066
million. Inventories marked an increase of¥1,484 million in fiscal 2015. Despite this, operating cash flow improved as we recorded¥3,100 million in income before income taxes
and minority interests and ¥3,673 million in
depreciation.
Net cash used in investing activities increased¥1,671 million year on year to ¥6,282 million.
Factors included ¥4,742 million in purchase ofproperty, plant and equipment and intangible
assets and ¥1,683 million in purchase of sharesof subsidiaries resulting in change in scope of
consolidation following the acquisition of additional shares of Nippon Resibon Corporation.
While net cash used in financing activities
totaled ¥1,313 million in the previous fiscal year,
net cash provided by financing activities cameto ¥2,720 million in fiscal 2015. Cash flows provided by financing improved on the back of proceeds from long-term loans, which increased to¥11,700 million. This came despite a net
decrease in short-term borrowings of ¥3,569
million, repayments of long-term debt of ¥4,486
million and ¥862 million in dividends paid.

Net Income per Share
(Yen)

14.34

11.02
8.91

’13

’14

’15

Total Assets(Millions of yen)

145,836

114,419’13

118,774’14’15

FINANCIAL POLICIESThe Noritake Group, in principle, funds general
operations and capital expenditures throughinternal reserves and borrowings or the issue ofcorporate bonds. In particular, working capitalfor general operations is provided by short-termborrowings with a maturity of one year or less. In
Japan, Noritake has adopted a cash management system under which the Company centrally

15Capital Ratio
(%)

57.7

57.8
54.1

’13

’14

’15

Return on Equity

procures funds and then allocates the procured
funds to consolidated subsidiaries in need ofoperating funds. Overseas, individual consolidated subsidiaries adhere to a basic policy of
procuring operating funds themselves in theirrespective local currencies.
As of March 31, 2015, the balance of shortterm borrowings totaled ¥3,400 million, most ofwhich is denominated in yen, with the remainder
in three other currencies. Noritake, in principle,
uses its internal reserves for capital expendituresand other long-term investments with a portion
covered by long-term debt. As of March 31,
2015, the balance of unsecured long-term loans
amounted to ¥16,938 million, most of which isdenominated in yen, with the remainder in twoother currencies. Unsecured bonds payablestood at ¥10,000 million.

(%)

2.8
2.6

2.0

’13

’14

’15

BUSINESS AND OTHER RISKS
Raw Material and Fuel Price Risk
The Noritake Group conducts operations centered on the ceramic manufacturing industry.
Like other industries, the ceramics industry is
subject to manufacturing cost increases attributable to the rise in raw material and fuel prices.
While continually working to improve productivity
and reduce costs, Noritake is strategically implementing upward revisions of its product prices
to compensate for such cost increases.
However, in the event that the Company cannot
carry out effective measures to deal with sudden
cost increases, its business performance andfinancial position may be adversely affected.
Exchange Rate Fluctuation Risk
The export ratios of the Ceramics & Materials
Group and the Tabletop Group are high in comparison to Noritake’s other business segments.
Accordingly, unfavorable trends in currency
exchange rates—more specifically, the yen’s
rapid appreciation—may negatively impact theperformance of these business segments, and,
consequently, the entire Company’s performance and financial position.

16

Disaster Risk
The Noritake Group has a number of businessbases in Japan and overseas. In the event thatthese business bases, particularly manufacturing bases, are damaged by earthquake, fire orother disaster, their operations may have to besuspended for a certain period of time, and thiswould adversely affect Noritake’s business performance and financial position.
Overseas Affairs Risk
The Noritake Group is actively promoting overseas operations. Deteriorations in public safety
and security, coupled with changes in politicalconditions, in one of the countries where
Noritake operates may restrict the Company’s
operations. In particular, in the case of war, civil
disturbance, terrorist attack and the like, theCompany’s operations may have to be suspended for a certain period of time. Should thisbe the case, the Noritake Group’s business performance and financial position may be negatively impacted.
Technology-Related Risk
The Noritake Group is increasingly concentrating
its management resources in such growth fields
as the electronics, semiconductor and energy
industries. These industries are characterized by
the rapid pace of their technological innovationand dynamic demand fluctuations, which cause
participants to experience technology and product obsolescence at shorter intervals than otherindustries. Accordingly, in the event that any of
the Noritake’s main products becomes obsolete,or Noritake fails to launch new products in atimely manner, its business performance andfinancial position may be negatively affected.
Risks and factors that could have adverse
effects on the Noritake Group’s business performance and financial position are not limited tothose described above. The analysis of risks isbased on information available to theCompany’s management as of March 31, 2015.

NORITAKE CO., LIMITED

Annual Report 2015

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55

OVERSEAS NETWORKD I R E C T O R S , C O R P O R AT E
AUDITORS ANDEXECUTIVE OFFICERS(As of June 26, 2015)(As of June 26, 2015)

INDUSTRIAL PRODUCTS GROUPNORITAKE CO., INC.
4990 ALLIANCE DR., MASON, OH 45040, U.S.A.
Tel: 1-513-234-0770(ATLANTA BRANCH)
490 Sun Valley Drive, Suite #102, Roswell,
GA 30076 U.S.A.
Tel: 1-770-518-8233
NORITAKE EUROPA GmbHKURHESSENSTRASSE 3, D-64546
MOERFELDEN-WALLDORF, GERMANY
Tel: 49-6105-2092-44
NORITAKE SHANGHAI TRADING CO., LTD.
ROOM 701 AETNA TOWER NO. 107,ZUN YI ROAD, CHANG NING DISTRICT,SHANGHAI, 200051, CHINA
Tel: 86-21-6237-5667(GUANGZHOU BRANCH)
2510, GOLDLION DIGITAL NETWORK CENTER,
138 TIYU ROAD EAST,GUANGZHOU 510620, CHINA
Tel: 86-20-3877-2253(DALIAN BRANCH)
22K, INTERNATIONAL FINANCE BUILDING, No15
RENMIN ROAD ZHONGSHAN DIST. DALIAN
116001, CHINA
Tel: 86-411-825-06065
NORITAKE SA (THAILAND) CO., LTD.
(BANGKOK OFFICE)
222 VORAVIT BUILDING 9TH FL., UNIT B
SURAWONG ROAD, SIPRAYA, BANGRAK,BANKOK 10500, THAILAND
Tel: 66-2-235-1688
SIAM COATED ABRASIVE CO., LTD.
AMATA CITY INDUSTRIAL ESTATE 7-126 MOO4,
T. MABYANGPORN, A. PLUAKDAENG,RAYONG 21140, THAILAND
Tel: 66-3-865-0150
CERAMICS & MATERIALS GROUPNORITAKE CO., INC.
2635 CLEARBROOK DRIVE,
ARLINGTON HEIGHTS, IL 60005, U.S.A.
Tel: 1-847-439-9020(NEW JERSEY BRANCH)
15-22 FAIR LAWN AVENUE, FAIR LAWN,
NJ 07410, U.S.A.
Tel: 1-201-475-5200(LOS ANGELS BRANCH)
21081 SOUTH WESTERN AVE.,SUITE 180 TORRANCE, CA 90501, U.S.A.
Tel: 1-310-320-1700
NORITAKE SCG PLASTER CO., LTD.
NO. 32 MOO7 NONGPLAKRADI ROAD,NONGPLING, NONGKHAE,SARABURI, 18140, THAILAND
Tel: 66-36-373578
PT. NORITAKE INDONESIABLOK A-II NO. 9A, KAWASAN BERIKAT,
KOTA BUKIT INDAH, PURWAKARTA 41181,
JAWA BARAT, INDONESIA
Tel: 62-264-351311
NORITAKE CO., LIMITED(TAIPEI OFFICE)
7F-2, NO.46, SEC-2,
CHUNG SHAN N. RD., TAIPEI 104,
TAIWAN, R.O.C
Tel: 886-2-2531-9906
56

NORITAKE CO., LIMITED(SHANGHAI OFFICE)ROOM 701 AETNA TOWER NO. 107,ZUN YI ROAD, CHANG NING DISTRICT,SHANGHAI, 200051, CHINA
Tel: 86-21-6237-5789
ITRON (U.K.) LIMITEDVANTAGE HOUSE, HARFREYS ROAD,
HARFREYS INDUSTRIAL ESTATE,GREAT YARMOUTH, NORFOLK, NR31 0LS,
UNITED KINGDOM
Tel: 44-1493-601144
NORITAKE EUROPA GmbHKURHESSENSTRASSE 3, D-64546
MOERFELDEN-WALLDORF, GERMANY
Tel: 49-6105-2092-0
ENGINEERING GROUPNORITAKE CO., INC.
2635 CLEARBROOK DRIVE,
ARLINGTON HEIGHTS, IL 60005, U.S.A.
Tel: 1-847-439-9020
NORITAKE TAIPEI CO., LTD.
NO. 37 ALLEY 105, LANE 514,
ZHONGZHENG RD., XINZHUANG DIST.,XINBEI CITY 242, TAIWAN, R.O.C.
Tel: 886-2-2907-1221
NORITAKE CO., LIMITED(SHANGHAI OFFICE)ROOM 701 AETNA TOWER NO. 107,ZUN YI ROAD, CHANG NING DISTRICT,SHANGHAI, 200051, CHINA
Tel: 86-21-6237-5789
TABLETOP GROUPNORITAKE CO., INC.
15-22 FAIR LAWN AVENUE,
FAIR LAWN, NJ 07410, U.S.A.
Tel: 1-201-796-2222

CHAIRMAN
Hitoshi Tanemura*
PRESIDENT
Tadashi Ogura*
DIRECTORS
Masahiro Nakagawa
Hisaya Ogura
Yoshitaka Mabuchi
Hiroshi Kato
Kozo Kato
Kosaku Yamada
Tetsuo Komori*Representative Director

CORPORATE AUDITORS
Kiyoshi Yoshida
Satoshi Aoki
Yasumasa Gomi
Kazutoyo Shinohara

NORITAKE CANADA LIMITED
90 NUGGET AVENUE, AGINCOURT,ONTARIO, M1S 3A7, CANADA
Tel: 1-416-291-2946

EXECUTIVE OFFICERSNORITAKE EUROPA GmbHKURHESSEN STRASSE 3, D-64546
MOERFELDEN-WALLDORF, GERMANY
Tel: 49-6105-2092-18

Hisaya Ogura

NORITAKE LANKA PORCELAIN (PRIVATE)LIMITEDWARAKAMURA, MATALE, SRI LANKA
Tel: 94-66-2244130(SHOWROOM)
77, DHARMAPALA MAWATHA,COLOMBO 7, SRI LANKA
Tel: 94-11-2301334
NORITAKE (AUSTRALIA) PTY LIMITEDUNIT 4, 153 BEAUCHAMP ROAD,
MATRAVILLE, N.S.W. 2036, AUSTRALIA
Tel: 61-2-9316-7123

Tadashi Ogura
Masahiro Nakagawa
Kiichi Hirano
Yoshitaka Mabuchi
Hiroshi Kato
Kozo Kato
Kenichi Horaguchi
Kenji Ito
Seiya Ogata
Koji Ogawa
Koji Sato
Akira Higashiyama

NORITAKE CO., LIMITED(SHANGHAI OFFICE)ROOM 701 AETNA TOWER NO. 107,ZUN YI ROAD, CHANG NING DISTRICT,SHANGHAI, 200051, CHINA
Tel: 86-21-6237-5789

NORITAKE CO., LIMITED

Annual Report 2015

Profile

Noritake Co., Limited, including its subsidiaries and associates

C O R P O R AT E D ATA

H I S T O R Y O F N O R I TA K E(As of June 26, 2015)(As of June 26, 2015)

HEAD OFFICE1876 Ichizaemon Morimura established3-1-36, Noritake-Shinmachi(Hereinafter “The Noritake Group”, “The Group” or simply “Noritake”)

Nishi-ku, Nagoya, Aichi

has developed technologies acquired from ceramics manufacturing451-8501, Japan

expertise and has expanded its business into such fields as grinding and polishing tools,

Tel: +81-52-561-7112
Fax: +81-52-561-9721

electronic component materials and manufacturing equipment.
With a focus on developing new products and technologies for energy-related industries—

DATE OF ESTABLISHMENT
January 1904

NUMBER OF EMPLOYEES
5,089 (Consolidated)

STOCK EXCHANGE LISTINGS
New Mid-term Business Plan

Tokyo Stock ExchangeWith the government’s recent economic policies, there were some positive signs in the Japanese economy. Nevertheless,

Nagoya Stock Exchange

Amid these circumstances, the Group launched its 9th Mid-term Business Plan in April 2013. The Plan identifies major
business challenges as being able to respond swiftly to market changes, and constructing a business andin-house use

1914 Succeeded in production of the first
1917 Sanitary ware division spun off to

ADMINISTRATOR OF SHAREHOLDERREGISTRY
Mitsubishi UFJ Trust and Banking
Corporation
4-5, Marunouchi 1-chome,every effort to achieve full recovery and improve our business performance.

Chiyoda-ku, Tokyo(2) Penetrating overseas markets and upgrading overseas manufacturing bases(3) Promoting an efficient management structure and upgrading infrastructure

become NGK Insulators Ltd.
in Japan
grinding wheels

1943 Tableware production stopped on
account of World War II, changed to fullproduction of grinding wheels(only bone china production continued
to preserve technique)the United States

1956 Began production of cutleryware

The annual meeting of shareholders of the1958 Established Noritake (Australia) Pty. Ltd.
in Australia

1960 Began production of resinoid grinding

in Nagoya, Japan.

wheels at the Kamori Plant

In addition, the Company may hold anextraordinary meeting of shareholders

1961 Began production of crystal glassware
Began production of melamine ware

whenever necessary by giving at least two

1962 Began production of grinding machines

weeks’ advance notice to shareholders.

1963 Began production of belt and

INDEPENDENT AUDITORS

1968 Established Noritake Canada Ltd.

fabric abrasives
KPMG AZSA LLC

Began production of materials andequipment for the ceramics industry

1981 Changed the Company name to
Noritake Co., Limited

1987 Established Noritake Europa G.m.b.H.
in Germany

1988 Established Noritake Taipei Co., Ltd. in
Taiwan1992 Established Noritake Singapore Pte. Ltd.

ANNUAL MEETING OF
SHAREHOLDERS
Company is normally held in June each year

1979 Began operation of the Craft Center

Established Nippon Toki Co., Ltd.

1919 Electric insulator division spun off to1947 Established Noritake Co., Inc. in(1) Boosting sales by competitively pricing new technologies and products

Inc. in the Philippines

1991 Established Noritake Hong Kong Ltd.

1945 Production of tableware resumed

100-8212, Japan

1974 Established Noritake Porcelana Mfg.,

become TOTO Ltd.

1939 Began full-scale production of industrial

management structure capable of achieving stable growth amid increasingly intense global competition. We will makeThe basic strategies of the 9th Mid-term Business Plan are as follows:1907 Began production of grinding wheels for1932 Began production of first bone china

the business environment is predicted to remain severe due to such concerns as slowing growth in China and otheremerging countries, as well as uncertainty in Europe.

1904 Established Nippon Toki Gomei Kaisha

dinner set in Japan

including solar cells, an area of promising growth—
Noritake seeks to create new value for customers and society.

Morimura-kumi in Tokyo, and Toyo
Morimura and others establishedthe Hinode Shokai (Morimura Brothers)
in New Yorkin Canada

1969 Began production of electronic products
1970 Established Noritake (U.K.) Ltd. in the
United Kingdom
Began production of fine ceramic industrial products

1971 Began production of filtration equipment
1972 Established Noritake Lanka Porcelain(Private) Ltd. in Sri Lanka

1973 Began production of diamond tools

1993 Opened the Noritake Gallery
1995 Established Pt. Noritake Indonesia
1996 Established Noritake (Siam) Co., Ltd. in
Thailand1997 Established Itron (U.K.) Ltd. in
the United Kingdom

1998 Established Noritake Dental Supply Co.,
Limited.

2001 Established Noritake Gypsum Co., Ltd.
Opened the Noritake Garden

2002 Established Noritake Bonded
Abrasive Co., Ltd.

2005 Established Noritake Shanghai Trading
Co., Ltd.

2009 Made Nippon Resibon Corporation its
associate by acquiring additional sharesof the stock of the company.
Absorbed Noritake Engineering Co.,
Ltd., Noritake China Mfg. Co., Limited,
Noritake Tableware Co., Ltd. and Tokyo
Toishi Co., Ltd.

2010 Absorbed Noritake Kizai Co., Ltd. and
Noritake Ceramics Co., Ltd.

2011 Absorbed Noritake Bonded Abrasive
Co., Ltd. and Noritake Super Abrasive
Co., Ltd.
Established Noritake SA (Thailand) Co.,
Ltd. in Thailand

2012 Made KCM Corporation its wholly-owned
subsidiary via a stock swap
Established Noritake Abrasives (Suzhou)Co., Ltd. in China

2014 Made Nippon Resibon Corporation its
consolidated subsidiary by acquiring
additional shares through a tender offer

Contents
1 Six-Year Financial Summary
12 Corporate Governance

2 Message from the Management

14 Consolidated Financial Review

5 Review of Operations

20 Consolidated Statements of Income / Consolidated Statements of Comprehensive Income
24 Consolidated Statements of Cash Flows

9 Topics

17 Report of Independent Auditors

10 Research & Development

18 Consolidated Balance Sheets

22 Consolidated Statements of Changes in Net Assets

25 Notes to Consolidated Financial Statements

56 Overseas Network / Directors, Corporate Auditors and Executive Officers

Caution with respect to forward-looking statements
This annual report includes forward-looking statements pertaining to expectations, plans, strategies, management goals, future performance,
expenses, revenues, income and other forecasts formulated on past experiences. Forward-looking statements necessarily entail some degree of
uncertainty, and the content conveyed in the results as well as underlying factors identified in the report may differ materially from actual results
depending on changes in those factors.

57 Corporate Data / History of Noritake
NORITAKE CO., LIMITED

Annual Report 201557

ANNUAL REPORT 2015

NORITAKE CO., LIMITEDYear Ended March 31, 2015

In du st ria l Produ c t s

C e ra mic s & M a t e ria ls

E n gin e e rin g

Ta ble t op
PRINTED IN JAPAN