[Business Report]
- Status of the Corporate Group
Major sales offices and plants (as of December 31, 2023)
(i) Major sales offices and plants of the Company
Name | Location | Name |
Head Office | Minato-ku, Tokyo | Niigata Sales Office |
Nagasaka Plant | Hokuto-shi, Yamanashi Pref. | Hokuriku Sales Office |
Ina Plant | Ina-shi, Nagano Pref. | Koshin Sales Office |
Chino Plant | Chino-shi, Nagano Pref. | Tokai Sales Office |
Hokkaido Sales Office | Sapporo-shi | Nagoya Sales Office |
Tohoku Sales Office | Sendai-shi | Osaka Sales Office |
Kita-Kanto Sales Office | Saitama-shi | Okayama Sales Office |
Tokyo Sales Office | Minato-ku, Tokyo | Hiroshima Sales Office |
Chiba Sales Office | Chiba-shi | Kyushu Sales Office |
Yokohama Sales Office | Yokohama-shi |
Location
Niigata-shi
Toyama-shi
Chino-shi, Nagano Pref.
Shizuoka-shi
Nagoya-shi
Osaka-shi
Okayama-shi
Hiroshima-shi
Fukuoka-shi
Notes:
- Head office was relocated from Chiba-shi on December 8, 2023.
- Tokyo Sales Office was relocated from Chuo-ku, Tokyo on December 8, 2023.
- Major sales offices and plants of subsidiaries
Name | Location |
Toyo Valve Co., Ltd. | Minato-ku, Tokyo |
Shimizu Alloy Mfg. Co., Ltd. | Hikone-shi, Shiga Pref. |
KITZ SCT Corporation | Ota-shi, Gunma Pref. |
KITZ Micro Filter Corporation | Chino-shi, Nagano Pref. |
KITZ (Thailand) Ltd. | Samutprakarn, Thailand |
KITZ Corporation of Taiwan | Kaohsiung, Taiwan |
KITZ Corporation of Jiangsu Kunshan | Jiangsu, P.R. China |
KITZ Corporation of Kunshan | Jiangsu, P.R. China |
KITZ SCT Corporation of Kunshan | Jiangsu, P.R. China |
KITZ Corporation of Lianyungang | Jiangsu, P.R. China |
KITZ Corporation of Shanghai | Shanghai, P.R. China |
KITZ Corp. of America | Texas, U.S.A. |
Metalúrgica Golden Art's Ltda. | Rio Grande do Sul, Brazil |
KITZ Corp. of Europe, S.A. | Barcelona, Spain |
Perrin GmbH | Hessen, Germany |
KITZ Corp. of Asia Pacific Pte. Ltd. | Singapore |
KITZ Corp. of Korea | Korea (Busan Metropolitan City) |
KITZ Corp. of Vietnam Co., Ltd. | Vinh Phuc, Vietnam |
KITZ Metal Works Corporation | Chino-shi, Nagano Pref. |
Hotel Beniya Co., Ltd. | Suwa-shi, Nagano Pref. |
Notes: |
- Toyo Valve Co. Ltd. relocated its head office from Chuo-ku, Tokyo on December 8, 2023.
- The "Location" for KITZ SCT Corporation indicates the location of its plant.
- Cephas Pipelines Corp. and KITZ Corp. of Korea merged on September 20, 2023; the surviving company is Cephas Pipelines Corp. and the disappearing company is KITZ Corp. of Korea. Cephas Pipelines Corp., the surviving company, was renamed KITZ Corp. of Korea.
- KITZ Corp. of Vietnam Co., Ltd. was newly established on March 15, 2023, and became a consolidated subsidiary.
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Status of employees (as of December 31, 2023)
(i) Employees of the corporate group
Business segment | Number of employees | Year-on-year change |
Valve Manufacturing Business | 4,927 | +34 |
Brass Bar Manufacturing Business | 231 | -11 |
Other | 85 | +3 |
Corporate (common) | 139 | +4 |
Total | 5,382 | +30 |
Notes: |
- The above figures do not include employees seconded from the Company Group to an external company or employees hired on a temporary/contractual basis.
- "Corporate (common)" indicates the number of employees serving in administrative divisions which do not belong to a specific segment.
- Employees of the Company
Number of employees | Year-on-year change | Average age | Average number of years of service |
1,443 | +21 | 40.1 | 14.2 |
Note: The above figures do not include employees seconded or employees hired on a temporary/contractual basis.
Major lenders of the corporate group and amount of debt (as of December 31, 2023)
(Units: Millions of yen) | |
Name | Outstanding debt |
The Hachijuni Bank, Ltd. | 2,623 |
Sumitomo Mitsui Banking Corporation | 1,283 |
Mizuho Bank, Ltd. | 776 |
The Chiba Bank, Ltd. | 415 |
The Yamanashi Chuo Bank, Ltd. | 414 |
MUFG Bank, Ltd. | 344 |
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Status of the Company | ||||
Matters regarding shares (as of December 31, 2023) | ||||
(i) Total number of authorized shares:400,000,000 shares | ||||
(ii) Total number of issued shares: | 90,110,946 shares | |||
Note: Total number of issued shares shown above does not include 285,565 shares of treasury stock that | ||||
were held as of the end of the fiscal year under review. | ||||
(iii)Number of shareholders:14,448 | ||||
Note: The number of shareholders does not include the Company. | ||||
(iv) Major shareholders (top 10 shareholders) | ||||
Name | Investment | |||
Shareholdings (thousands) | Holding ratio (%) | |||
The Master Trust Bank of Japan, Ltd. | 9,786 | 10.86 | ||
Kitazawa-kai Stock Ownership Plan | 5,134 | 5.70 | ||
Nippon Life Insurance Company | 4,303 | 4.78 | ||
Sumitomo Life Insurance Company | 3,448 | 3.83 | ||
Kitazawa Ikueikai Foundation | 3,411 | 3.79 | ||
KITZ Corporation Trading Partner Stock | 3,287 | 3.65 | ||
Ownership Plan | ||||
Custody Bank of Japan, Ltd. | 2,596 | 2.88 | ||
Sumitomo Mitsui Banking Corporation | 2,553 | 2.83 | ||
KITZ Corporation Employee Stock | 2,105 | 2.34 | ||
Ownership Plan | ||||
SECOM General Insurance Co., Ltd. | 1,702 | 1.89 | ||
Notes: |
- The Company held 285 thousand shares of treasury stock as of December 31, 2023.
The holding ratio is calculated with the total number of issued shares excluding treasury stock.
The Company adopted a BIP trust, and The Master Trust Bank of Japan, Ltd. holds 396 thousand shares of the Company in the trust. These 396 thousand shares are not included in the concerned treasury stock. - The above number of shares held includes shares associated with trust operations as follows:
The Master Trust Bank of Japan, Ltd. | 9,786 thousand shares |
Custody Bank of Japan, Ltd. | 2,596 thousand shares |
3. The number of shares held by Sumitomo Life Insurance Company includes 6 thousand shares in the variable insurance account and 32 thousand shares in the separate account.
- Matters regarding subscription rights to shares
Not applicable.
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Officers of the Company (as of December 31, 2023)
(i) Summary of liability limitation agreements
In order to limit the liability of Directors (excluding persons who are Executive Directors; likewise, hereinafter in this paragraph) and Audit & Supervisory Board Members a reasonable extent and ensure that they fully perform the roles expected of them, the Company has, pursuant to the stipulations of Article 427, paragraph (1) of the Companies Act, included provisions in its Articles of Incorporation to the effect that the Company can conclude agreements with its Directors and Audit & Supervisory Board Members limiting their liability under Article 423, paragraph (1) of the same Act provided that the Director or Audit & Supervisory Board Member concerned has undertaken his or her duties in good faith and has not committed any gross errors. Based on these provisions, the Company has concluded agreements with each of its Directors and Audit & Supervisory Board Members.
Based on the concerned agreements, the amount of liability is limited to ¥5 million or the amount prescribed by laws and regulations, whichever is higher.
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(ii) Major concurrent positions of Directors and Audit & Supervisory Board Members
Position | Name | Name of organization in which | Concurrent position |
concurrent position is held | |||
Yasuyuki Hotta | KITAZAWA MUSEUM OF ART | Chairman | |
Makoto Kohno | KITZ SCT Corporation | Director | |
Director | KITZ Metal Works Corporation | Director | |
Toshiyuki Murasawa | KITZ Micro Filter Corporation | Director | |
Hotel Beniya Co., Ltd. | Director | ||
Toyo Valve Co., Ltd. | Audit & Supervisory Board | ||
Member | |||
KITZ SCT Corporation | Audit & Supervisory Board | ||
Member | |||
KITZ Micro Filter Corporation | Audit & Supervisory Board | ||
Member | |||
Hotel Beniya Co., Ltd. | Audit & Supervisory Board | ||
Masahiko Kondo | Member | ||
KITZ Corporation of Taiwan | Audit & Supervisory Board | ||
Member | |||
KITZ Corporation of Kunshan | Audit & Supervisory Board | ||
Standing Audit & | Member | ||
Supervisory Board | KITZ SCT Corporation of Kunshan | Audit & Supervisory Board | |
Member | Member | ||
KITAZAWA MUSEUM OF ART | Auditor | ||
Shimizu Alloy Mfg. Co., Ltd. | Audit & Supervisory Board | ||
Member | |||
KITZ Metal Works Corporation | Audit & Supervisory Board | ||
Member | |||
Taro Kimura | KITZ Corporation of Jiangsu Kunshan | Audit & Supervisory Board | |
Member | |||
KITZ Corporation of Lianyungang | Audit & Supervisory Board | ||
Member | |||
KITZ Corporation of Shanghai | Audit & Supervisory Board | ||
Member | |||
Notes: |
1. The organizations in which a concurrent position is held and which belong in the same business categories as the Company are as follows:
(Name) | (Business) |
Toyo Valve Co., Ltd. | Sales, marketing and distribution of valves |
Shimizu Alloy Mfg. Co., Ltd. | Manufacturing and sales of valves |
KITZ SCT Corporation | Manufacturing and sales of valves and fittings for |
semiconductor production equipment | |
KITZ Corporation of Taiwan | Manufacturing and sales of valves |
KITZ Corporation of Jiangsu Kunshan | Manufacturing and sales of valves |
KITZ Corporation of Kunshan | Manufacturing and sales of valves |
KITZ SCT Corporation of Kunshan | Manufacturing and sales of valves and fittings for |
semiconductor production equipment | |
KITZ Corporation of Lianyungang | Manufacturing and sales of valves |
KITZ Corporation of Shanghai | Sales, marketing and distribution of valves |
- Of the major concurrent position held by Director Yasuyuki Hotta, the concurrent position of Chairman of KITAZAWA MUSEUM OF ART is a significant concurrent position.
- Of the major concurrent positions held by Audit & Supervisory Board Member Masahiko Kondo, the concurrent position of Auditor of KITAZAWA MUSEUM OF ART is a significant concurrent position.
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(iii)Outline of Directors and Officers Liability Insurance contract
The Company has entered into a Directors and Officers Liability Insurance contract with an insurance company, as stipulated in Article 430-3, paragraph (1) of the Companies Act. The scope of the insured under the insurance contract is directors and auditors of the Company and its subsidiaries (including their retirees), and the insured does not bear any insurance premium. The insurance contract covers the insured's losses and such costs as related litigation expenses incurred from shareholders' or a third party's claims for damages arising from the insured's acts (including nonfeasance) as an officer of the Company; provided, however, that in order to ensure that the proper performance of duties of the insureds is not impaired, the contract shall not cover the officer's damages resulting from his or her criminal acts or intentionally illegal acts.
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Matters regarding outside officers
a. Significant concurrent positions in or relationships with other companies - Outside Director Minoru Amoh concurrently holds the positions of Outside Director of Otsuka Chemical Co., Ltd. and Outside Director (Audit & Supervisory Committee Member) of Enplas Corporation. There is no special relationship between these companies and the Company.
- Outside Director Yutaka Fujiwara concurrently holds the position of External Audit & Supervisory Board Member at Konoike Transport Co., Ltd. There is no special relationship between Konoike Transport Co., Ltd. and the Company.
-
Outside Director Yukino Kikuma is concurrently a Managing Partner at MATSUO & KOSUGI (legal professional corporation) that has concluded a legal counsel agreement with the Company. The total amount of fees (consulting fees, legal advising fees, etc.) that the Group pays to the law firm is less than 2% of the average annual sales of the law firm for the past three fiscal years and less than 1% of the Company's annual consolidated net sales for the fiscal year under review.
Outside Director Yukino Kikuma concurrently holds the position of Outside Director of ALCONIX CORPORATION. The ALCONIX group conducts business with the Group. The amount of transactions of castings and materials that the Group purchases from the ALCONIX group is less than 3% of the Company's annual consolidated net sales for the fiscal year under review. The amount of transactions of products that the Group sells to the ALCONIX group is less than 1% of the Company's annual consolidated net sales for the fiscal year under review.
Also, Outside Director Yukino Kikuma concurrently holds the positions of External Director of KOSÉ Corporation and Outside Director (member of the audit and supervisory committee) of Takihyo Co., Ltd. There is no special relationship between these companies and the Company. - Outside Audit & Supervisory Board Member Shuhei Sakuno concurrently holds the position of Outside Audit & Supervisory Board Member at JAPANIACE Co., Ltd. There is no special relationship between JAPANIACE Co., Ltd. and the Company.
- Outside Audit & Supervisory Board Member Ayako Kobayashi is concurrently an attorney (partner) at KATAOKA & KOBAYASHI LPC and holds the positions of Outside Director of The Musashino Bank, Ltd. and Professor of Keio University Law School. There is no special relationship between KATAOKA & KOBAYASHI LPC, The Musashino Bank, Ltd., Keio University Law School, and the Company.
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b. Significant activities during the fiscal year under review
Position | Name | Attendance at | Main Activities and Outline of Duties Performed Regarding Roles Expected of |
meetings | Outside Directors | ||
Board of Directors' | Fulfilled the role appropriately by making active and useful statements at | ||
meetings of the Board of Directors, leveraging his extensive experience as a | |||
Outside | Kazuyuki | meetings | |
corporate manager in the manufacturing industry and high level of insight into | |||
Director | Matsumoto | 16/16 | |
technological development, manufacturing, etc. In addition, chaired the | |||
(100%) | |||
Nominating and Compensation Committees. | |||
Board of Directors' | Fulfilled the role appropriately by making active and useful statements at | ||
meetings of the Board of Directors, leveraging his extensive experience as a | |||
Outside | Minoru | meetings | |
corporate manager in the manufacturing industry and high level of insight into | |||
Director | Amoh | 16/16 | |
global business development, technology development, etc. In addition, served | |||
(100%) | |||
as a member of the Nominating and Compensation Committees. | |||
Fulfilled the role appropriately by making active and useful statements at the | |||
Board of Directors' | meetings of the Board of Directors, leveraging his extensive experience as a | ||
Outside | Yutaka | meetings | manager of overseas operations and a financial officer in manufacturing |
Director | Fujiwara | 16/16 | industry at a financial institution, and high level of insight into business |
(100%) | management, financial strategy, governance, etc. In addition, served as a | ||
member of the Nominating and Compensation Committees. | |||
Board of Directors' | Fulfilled the role appropriately by making active and useful statements at | ||
meetings of the Board of Directors, utilizing her extensive experience as an | |||
Outside | Yukino | meetings | |
attorney at law and high level of insight into corporate legal affairs, including | |||
Director | Kikuma | 16/16 | |
compliance and risk management, etc. In addition, served as a member of the | |||
(100%) | |||
Nominating and Compensation Committees. | |||
Position | Name | Attendance at | Main Activities |
meetings | |||
Board of Directors' | Fulfilled the role appropriately by making active and useful statements at the | ||
Outside | meetings | meetings of the Board of Directors and Audit & Supervisory Board, leveraging | |
16/16 | his abundant experience as CFO and audit & supervisory board member in the | ||
Audit & | |||
Tatsuhiko | (100%) | manufacturing industry and high level of insight into financial accounting and | |
Supervisory | |||
Takai | Audit & Supervisory | corporate planning, etc. | |
Board | |||
Board meetings | |||
Member | |||
14/14 | |||
(100%) | |||
Board of Directors' | Fulfilled the role appropriately by making active and useful statements at the | ||
Outside | meetings | meetings of the Board of Directors and Audit & Supervisory Board, leveraging | |
16/16 | his abundant experience as a corporate management officer in the | ||
Audit & | |||
Shuhei | (100%) | manufacturing industry and high level of insight into financial accounting, | |
Supervisory | |||
Sakuno | Audit & Supervisory | internal controls, risk management and development of internal audit structure, | |
Board | |||
Board meetings | etc. | ||
Member | |||
14/14 | |||
(100%) | |||
Board of Directors' | Fulfilled the role appropriately by making active and useful statements at | ||
Outside | meetings | meetings of the Board of Directors and Audit & Supervisory Board, utilizing | |
16/16 | her extensive experience as an attorney at law and high level of insight into | ||
Audit & | |||
Ayako | (100%) | corporate legal affairs, including compliance and risk management. | |
Supervisory | |||
Kobayashi | Audit & Supervisory | ||
Board | |||
Board meetings | |||
Member | |||
14/14 | |||
(100%) |
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Matters regarding Financial Auditor
(i) Name
Ernst & Young ShinNihon LLC
(ii) Amount of remuneration
Amount of remuneration to be paid by the Company for services with respect to the current fiscal year | |
a. Amount of remuneration to be paid for services stipulated in Article 2, paragraph (1) of the Certified | ¥76 million |
Public Accountants Act | |
b. Amount of remuneration to be paid for services (non-auditing services) other than those stipulated in | ¥22 million |
Article 2, paragraph (1) of the Certified Public Accountants Act | |
Total amount of money and other financial benefits to be paid to Financial Auditor by the Company and | ¥124 million |
its subsidiaries
Notes:
- In the audit contract between the Company and Financial Auditor, remuneration paid for audits under the Companies Act and audits under the Financial Instruments and Exchange Act are not distinguished and cannot be practically separated. Therefore, the amount of payment for both is shown in Amount of remuneration above.
- The Company pays to the Financial Auditor a consideration for the support for developing the Group's Accounting Policy, which is non-auditing services other than those stipulated in Article 2, paragraph (1) of the Certified Public Accountants Act.
- Significant overseas subsidiaries of the Company receive audits from auditors other than the Company's Financial Auditor.
(iii)Reason for Audit & Supervisory Board' consent toward the remuneration of the Financial Auditor
In accordance with the auditing standards determined by the Audit & Supervisory Board, the Audit & Supervisory Board has reviewed whether the Financial Auditor's audit plans will provide an auditing system and auditing timeframe sufficient to secure the quality of audits, and the members have considered and deliberated matters such as the effectiveness and efficiency of the audits in the previous period, whether there is additional remuneration to calculate, the auditing timeframe and remuneration units trends in previous years, the basis for estimating remuneration, and the status of non-auditing services agreement. Based on the results of such review and deliberation, the Audit & Supervisory Board determined that the Financial Auditor's audit plans were appropriate, and that the amount of remuneration was commensurate with the Financial Auditor's duties. Accordingly, the Audit & Supervisory Board provided their consent toward the remuneration of the Financial Auditor.
- Policy for determining the dismissal or non-reappointment of the Financial Auditor
- The Audit & Supervisory Board will, by the unanimous consent of all members thereof, dismiss the Financial Auditor if the Financial Auditor is deemed to fall under any of the items listed in Article 340, paragraph (1) of the Companies Act.
- The Audit & Supervisory Board will determine the contents of a proposal to the General Meeting of Shareholders for the dismissal or non-reappointment of the Financial Auditor and the contents of a proposal for a new Financial Auditor in cases where it is judged that the Financial Auditor is unable to maintain the quality of audits or to continue to duly perform its duties, such as cases where there is serious doubt regarding the Financial Auditor's independence or aptitude, and cases where there are serious deficiencies in the system for enabling the Financial Auditor to duly perform its duties, and where there is no prospect of making improvements to secure the quality of audits.
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c. If the Audit & Supervisory Board comprehensively reviews the existing Financial Auditor, including with respect to quality of audits, independence, aptitude, reliability, effectiveness, and efficiency, and concludes that it will be necessary to elect a new Financial Auditor with prospects of delivering more suitable audits, the Audit & Supervisory Board will determine the contents of a proposal to the General Meeting of Shareholders for the non-reappointment of the existing Financial Auditor and the election of the new Financial Auditor.
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-
Systems for Ensuring Appropriate Operations and the Status of Implementation of such Systems
1. Systems for ensuring the appropriateness of operations
The Company stipulated the Basic Policy on Internal Control at the Board of Directors to arrange the system to ensure the appropriateness of operations.
[1] Basic Policy on Internal Control
1. System for ensuring that the performance of duties of directors and employees of the Company and its subsidiaries conform to laws, regulations, and the Articles of Incorporation
- Directors and employees of the Company and its subsidiaries shall carry out their duties in thorough conformity to laws, regulations, and the Articles of Incorporation, as well as the KITZ' Statement of Corporate Mission, Long-Term Management Vision, the Action Guide, the Basic Policy on Sustainability, the Basic Policy on Corporate Governance, the Compliance Code of Conduct, and other policies established by the board of directors of the Company or its subsidiary.
- The Board of Directors shall receive periodic reports on the state of execution of business operations from the Executive Directors and Executive Officers and shall oversee the performance of the duties of each director.
- Audit & Supervisory Board Members shall carry out auditor audits of the performance of the duties of Directors based on the rules of the Audit & Supervisory Board and the standards for auditor audits.
- The C&C Control Committee, chaired by the president, shall be established as an organization to maintain the Groupwide compliance structure and ascertain and address related issues, to respond to crises, and to supervise risk management. This committee shall promote compliance Groupwide.
- The Group shall establish a Groupwide internal whistleblowing system to enable notification, reporting, and consultation regarding any violations of laws, regulations, or the Compliance Code of Conduct or other suspicious acts that have been identified. As the contact point to receive such communications, it shall establish a Compliance Helpline at the Company and subsidiaries, as well as inside a law firm.
- The Compliance Guidebook shall be distributed to directors and employees of the Company and subsidiaries as part of compliance awareness-raising and educational activities and to publicize the Compliance Helpline.
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Kitz Corporation published this content on 05 March 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 March 2024 23:50:06 UTC.