Bull s
JK Holdings
Quarterly ReportMay,2019
CONTENTSInternational

Overview of the Financial
Results for JKHD for theThird Quarter of the Fiscal
Year Ending in March, 2019
Housing starts totaled 737,300 units（a decline of 0.5%
from the same period of the previous year）for the
first 3 quarters of 2019. Housing starts for the owner-occupied, which is our main market, increased 0.5%
from the same period of the previous year to 222,300units. With regard to plywood, which is our main
products, there is no change in the supply restriction
factors due to the higher tax for logging in the producing regions and the environmental regulations,and the demand keeps shifting to Japanese softwood
plywood. The supply of imported plywood that turned
to increase in the third quarter for the higher price ofimported plywood and the strong yen have brought
anticipation of a fall in the product prices for the moment.

P1

Overview of the Financial Results for JKHD
for the third Quarter of Fiscal 2018
The 41st Japan Kenzai Fair exceeded theprojected ﬁgures both in sales and visitors
P2 Prospect of Business Conditions for AprilJune
P3 Market Outlook Plywood
J-GREEN Enjoys Brisk Sales
P4 JK Timber Engineering Group Enjoys Healthy
Sales

Keiichiro Aoki

President
JK Holdings Co.,Ltd.

Under these business environments, we have enhanced
sales of lumber and precut in the basic material sector,
have improved our private brands such as Bulls andJ-GREEN items（legal lumber）, and have worked onfunctional enhancement of our engineering business topromote sales and improve profitability of the overallbuilding material business in our entire group. Consequently, the consolidated business results for the thirdquarter found 268.544 billion yen in the net sales（3.1%increase compared to the same period of the previousyear）, 3.969 billion yen in the operating profit（down10.8%), and 3.69 billion yen in the ordinary income（down 17.0%）. The current net income for the quarter that is attributable to the parent company shareholders was 1.946 billion yen（down 26.3%）.

Event
The 41st Japan Kenzai Fair exceeded the projected
ﬁgures both in sales and visitors
The 41st Japan Kenzai Fair held at Tokyo Big
Sight on March 15 and 16 resulted in sales of
54,677 million yen with 20,306 visitors, both ofwhich exceeded the projected figures. Withthe theme of“connections”, the 41st fair proposed the latest items for living spaces fromfour perspectives of“IoT”,“5th ROOM”,“air”
and“hobby”. What were notable among theexhibitions by the building material manufacturers were such products to improve the living spaces, and their demonstrations attracted
many visitors.

54

No.

Bulls International No.54

2

Surveyweak in the east. They forecasta large growth in western Japan
mainly in Kyushu and Chugoku
regions, but many expected a decrease in the Kanto region whereone third of the population is concentrated.

Prospect of BusinessCondition for
April-June<Demand Forecast by
Builders and Distributors>

The number of applications for
Flat 35 was 7,632 in January,which was 108% over the previous
year’s results. We would like toexpect a growth in the owner-occupied home and built-for-saledetached home sectors, since theoccupancy rate of Flat 35S is ashigh as 87%. With the consumption
tax hike coming up in October thisyear, it is expected that users’attitude for housing acquisition will beseverer. The idea of“housing notas a financial instrument, but as a
product to use by living in”would
be stronger.

The demand forecast for AprilJune 2019 when last-minute demands before the consumption
tax raise are expected showed anincrease among builders from plus
0.3 point in the previous survey
for January-March to plus 1.0 point
and unchanged at 1.9 points among
distributors. The forecast foundpositive responses for two consecutive months after about threeyears.
Analyzing the demand forecast byarea, the demand continues to bepredicted strong in the west and21.000.3-2-6-5.4
-7.3

-6.1
-5.7

-7.0

-8
-10 Apr-Jun
2017

-8.1

-9.1
Oct-Dec
2017

Apr-Jun2018<Current Status ofRemodeling Business>
The remodeling and renovation
business is still prospected to bemoving upward all over Japan, but
it seems slightly weaker than it
was in the previous survey. Theunit price of property is rising at
the low end. By area, West Japan
has been in strong demand, and it
is also a good factor that negative
prediction decreased in the Kanto
region, the giant market. Remodeling would be the sector that willbe most paid attention in the next
survey as the tax raise approaches.

<Sales Forecast by Leading
Manufacturers>

Demand Forecast by Builders-4

the housing equipment manufacturers in particular predicted anincrease. While builders and dealers forecast only a conservative
growth, manufacturers predicted
a larger increase since they seemto estimate rising demands in thenon-residential and remodelingsectors.

Oct-Dec
2018

The rate of leading manufacturers
found over 33 pointsof growth in all thesectors as plywood,
wooden building
materials, ceramic,
thermal, and housing
equipment, and half

Apr-Jun
2019

Point0=business result in April-June,1992

Dealing Volume of Lumber

Demand Forecast by Distributors
261

1.9 1.90

The forecast survey for April-June 2019 isbased on the totaled data gathered from 3,000
client companies in Japan through interviews
which took place from late-January to mid-February 2019.

60-2

Laminated lumber

59-4 -5.1-5.6-6-3.7

-5.5

-6.0

-6.3

-8

-10 Apr-Jun
2017

Precut lumber

58
57-9.1
Oct-Dec
2017

Apr-Jun2018

Oct-Dec
2018

LVL

56 Apr-Jun

Apr-Jun2019

2017

Solid lumber
Oct-Dec
2017

Apr-Jun2018

Oct-Dec
2018

Apr-Jun2019

Point100=all responses expect increase

Point0=business result in April-June,1992

Sales Forecast by Major Supplying Manufacturers（Apr-Jun 2019）
increaseover15％
Plywood（13firms）

14 ～ 10％

below10％level-offdecrease
below10％10 ～ 14％

over15％

0.0

0.0

33.3

58.4

8.3

0.0

0.0

0.0

2.5

41.3

34.9

18.8

0.0

2.5

0.0

2.5

31.7

55.0

10.8

0.0

0.0

House Equipments（9firms）

0.0

0.0

50.0

38.9

11.1

0.0

0.0

average

0.0

1.3

39.1

46.712.3

0.00.6

Wooden Building Materials（10firms）
Ceramic/Heat Insulation（15firms）

International No.54

TrendPlywood Market Condition

Market Outlookof Plywood<Trend of Domestic Plywood>
In February 2019, production volume of domestic softwood plywood
was 263,600 cubic meters（up4.3% from the same month in theprevious year）, and its shipment
volume was 252,677 cubic meters（up 6.1%）. Stock volume showeda slight increase from the previous
month to 135,200 cubic meters,
which increased after five monthsof decline.
Though the cargo movement was
not so active through general distribution routes, there were actual requirements from businesses
through direct distribution routes,
precast concrete factories whichwant to secure inventories before
Golden Week holidays.
In western Japan, especially in theKyushu area, stock volume continued to be low, so, the area is positive to purchase domestic plywood.
New factories are scheduled tostart operation soon in prefecturesof Yamanashi and Oita, which willCompanyJ-GREEN Enjoys
Brisk Sales

Japan Kenzai Co., Ltd., an affiliatedfirm of JKHD, established an environmental-friendly private brandof a wooden product family named“J-GREEN”and started selling its
goods in 2017. The brand is expanding its line of products centering those which can contribute to
the resource environment such asaffiliated lumber, and eco-friendly
products such as timber from forest thinning or recycled materials.
J-GREEN’s products have rapidly
increased its sales responding to
the society’s growing demand for
legitimate lumber and building materials.

boost the production capacity.

<Trend of Imported Plywood>
The volume of imported plywood
in February 2019 was 257,000 cubic
meters（down 6.1% from the samemonth in the previous year）.
Looking into the result by nation,
93,200 cubic meters（down 9.9%）
were imported from Malaysia,
76,400 cubic meters（down 12.7%）
was from Indonesia, and 65,200cubic meters（up 2.6%）was from
China.

Bulls

Currently, port inventories haveswollen nationwide, because a large
amount of plywood arrived at ports
since January 2019. With inactive
shipment, warehouses are runningout of space. Market condition ofimported plywood is opposite tothat in the previous year, and users
are buying hand-to-mouth with low
motivation. As there is a trend toshift to domestic plywood in themarket, the supply of imported plywood may not drastically increasein the future.

Wholesalers' Prices of Plywood in Tokyoyen/sheet

Imported Plywood（Structural Use）
Imported Plywood（Concrete Form）
Domestic Plywood［Softwood Plywood for Structural Use(12mm)］
Domestic Plywood［Softwood Plywood for Structural Use(24mm)］

2500

2000

1500

1000

5000

Oct 2018

Nov 2018

Dec 2018

Already released private brand“Bulls” has become the company’s flagship having annual sales of
12 billion yen by selling the lineup

Jan 2019

Feb 2019

Mar 2019of housing equipment. Planning tomake itself grow as a big brand as“Bulls”in the future, J-GREEN isexpanding its product lineup.

3

4Bulls International No.54

Company

JK Timber Engineering Group Enjoys Healthy Sales

Sales of JK Timber Engineering Group, which is participated by six companies of the JKHD group (JapanKenzai Co., Ltd., KEYTEC, Butsurin Co., Ltd., Akita
Glulam Co., Ltd., Miyamori Co., Ltd., and Meirin Co.,
Ltd.) and totally supporting works in wooden structuralbuildings from designing structure of building framesto construction control, reached a record 4 billion yenin the fiscal 2018. Behind the excellent condition are thefacts that construction of large-scale and/or high-risewooden buildings using structural laminated lumberand CLT has started to spread in Europe, and that ma-

jor general contractors and designing offices in Japan
have increasingly been interested in wooden structures
recently.
In addition to that, public interest in them has drastically gained momentum after athletic facilities of the2020 Tokyo Olympic Games were built with wood. The
six companies of JK Timber Engineering Group will
satisfy the demand for wooden buildings making themost of respective company’s realms of expertise on
businesses of wholesales, laminated lumber and LVL.

東急池上線「戸越銀座駅」

ノーザンステーション秋田駅

キーテック内装用 LVL を活用
写真提供：浅川敏

Wood Land Tower 1-7-22 Shinkiba Koto-ku,Tokyo 136-8405 Japan
Phone +81-3-5534-3800 Fax +81-3-5534-3833
E-mail kouhou@jkhd.co.jp
URL http://www.jkhd.co.jp
C 2018JK Holdings Publication Copyright○