Makino Milling targets 10% margin, chief says

TOKYO -- Makino Milling Machine aims for an operating profit margin of at least 10% by focusing on the automotive industry, the company's president told The Nikkei. "We hope to achieve 10% or higher soon" by raising efficiency, President Jiro Makino said. The profit margin for the current fiscal year ending March 31 is projected at 8.1%. The target is comparable to the pre-Lehman shock margin of 11% reached in fiscal 2007. The Tokyo-based company supplies machinery for making parts and dies to manufacturers. In Japan, which accounts for some 30% of the company's business, the automotive industry is beefing up output with help from the weaker yen. And in North America, output of automobiles and civilian-use aircraft remains high. "Domestic plants are extremely busy," Makino said, noting that the company will revamp production equipment, including automating Yamanashi Prefecture facilities to reduce required manpower. On the slowing Chinese economy, he said the current situation does not ring alarm bells. "We are receiving a steady stream of inquiries about our products used in manufacturing high-end automobiles," he said. As industrial production rises worldwide, Makino Milling's earnings are on an uptrend. For the current fiscal year, the company projects 8% growth in both group operating profit and sales, to 13 billion yen ($109 million) and 161 billion yen, respectively.