Rinnai Corp. (Nagoya, Japan) reported net sales of 114,216 million yen (approx. US$1.4 billion) in the first six months of its current fiscal year, which ends in March 2013. Net sales were down 0.1% from the first half of the previous fiscal year. Net income was 7,473 million yen (approx. $92 million), up 13.7% from the first half of the previous year.
The company is forecasting net sales for the fiscal year to be up 4.2%, to 257,000 million yen, and net income to be up 13%, to 19,000 million yen
Sales in Japan in the first half of the fiscal year were helped by Japanese concern over saving electricity. This led to increased sales of high-efficiency hot water heaters and led to solid sales of gas-fueled appliances, such as built-in stoves and water heaters.
The solid replacement market for boilers continued in South Korea, but results were hurt by exchange rates.,
North American demand for hot water appliances was stagnant, which Rinnai said was a result of the housing market. Sales of tankless hot-water units declined, bringing down sales in North America by 8.3%, to 5,319 million yen. Operating income fell 86.9%, to 30 million yen. These results came about despite the launch of lower-cost products.
Sales of gas hot water appliances was steady in Australia. Sales, however, were down 16.7%, to 7,633 million yen, compared to the previous year's first half. This was the result of a spike in demand for sales of heaters for schools in the previous year. Operating income fell 31.1%, to 1,623 million yen.
Sales remained challenging in Shanghai and other major cities in China, Rinnai reported, but growing demand for gas hot water units remained strong in the country. This is facilitated by the expansion of the gas infrastructure in interior regional cities in China. Sales in China grew 2.7%, to 5,471 million yen in the first half of the current fiscal year. At the same time, Rinnai reported strong cost reduction costs, leading to an operating income increase of 153.2%, to 421 million yen.
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