Notice Regarding Recognition of an Impairment Loss on Fixed Assets (Extraordinary Loss) and Change in Subsidiary Status (Making a Specified Subsidiary)
小名浜製錬株式会社 (the Company's consolidated subsidiary; 100% owned by the Company)
Copper concentrate processing and related smelting facilities at the Onahama Smelter. E-Scrap, shredder dust, the electrolytic plant, PGM plant and casting plant are also covered.
Competition with overseas smelters has intensified, the terms (TC/RC) for purchasing copper concentrate from mining companies have deteriorated substantially, and the outlook has become uncertain.
The impairment loss is expected to total ¥21.0 billion (extraordinary loss). The capital increase will be up to ¥23.0 billion, through the conversion of loans receivable into common shares.
The consolidated financial results for the fourth quarter of the fiscal year ending March 2026
The impairment loss has already been reflected in the full-year consolidated earnings forecast announced on 12 February 2026. The impact of the capital increase on consolidated full-year results for the fiscal year ending March 2026 is expected to be immaterial.
Change in voting rights ownership ratio
The voting rights ownership percentage is the proportion of the voting rights exercisable at a shareholders' meeting held by the shareholder.
Number of voting rights: Not disclosed; ownership ratio: 100% held by the Company (before the capital increase)
Number of voting rights: Not disclosed; ownership ratio: 100% held by the Company (expected after the capital increase)
Company response
Processing of copper concentrate and operation of related smelting facilities at the Onahama Smelter are expected to cease by the end of March 2027. Receipt of E-Scrap and shredder dust is expected to be suspended or transferred to other production sites. Operations at the electrolytic plant, PGM plant and casting plant, among others, will continue.
Processing of copper concentrate and operation of related smelting facilities are expected to cease by the end of March 2027. Receipt of E-Scrap and shredder dust is expected to be suspended or transferred to other sites. A capital increase of up to ¥23.0 billion is expected to be implemented by 30 June 2026. Operations at the electrolytic plant, PGM plant and casting plant, among others, will continue.
| Item | Details |
|---|---|
| Event name | Notice Regarding Recognition of an Impairment Loss on Fixed Assets (Extraordinary Loss) and Change in Subsidiary Status (Making a Specified Subsidiary) |
| Date of occurrence | 25 March 2026 (date of the Board of Directors' resolution; processing of copper concentrate and operation of related smelting facilities are expected to cease by the end of March 2027) |
| Subject Entity | 小名浜製錬株式会社 (the Company's consolidated subsidiary; 100% owned by the Company) |
| Target Locations / Products | Copper concentrate processing and related smelting facilities at the Onahama Smelter. E-Scrap, shredder dust, the electrolytic plant, PGM plant and casting plant are also covered. |
| Cause | Competition with overseas smelters has intensified, the terms (TC/RC) for purchasing copper concentrate from mining companies have deteriorated substantially, and the outlook has become uncertain. |
| Amount of Impact on Business Performance | The impairment loss is expected to total ¥21.0 billion (extraordinary loss). The capital increase will be up to ¥23.0 billion, through the conversion of loans receivable into common shares. |
| Accounting period in which recognized | The consolidated financial results for the fourth quarter of the fiscal year ending March 2026 |
| Impact on Earnings Forecast | The impairment loss has already been reflected in the full-year consolidated earnings forecast announced on 12 February 2026. The impact of the capital increase on consolidated full-year results for the fiscal year ending March 2026 is expected to be immaterial. |
| Suspended operations | Processing of copper concentrate and operation of related smelting facilities at the Onahama Smelter are expected to cease by the end of March 2027. Receipt of E-Scrap and shredder dust is expected to be suspended or transferred to other production sites. Operations at the electrolytic plant, PGM plant and casting plant, among others, will continue. |
| Voting rights ownership percentage before the change | Number of voting rights: Not disclosed; ownership ratio: 100% held by the Company (before the capital increase) |
| Voting rights ownership percentage after the change | Number of voting rights: Not disclosed; ownership ratio: 100% held by the Company (expected after the capital increase) |
| Outlook | Processing of copper concentrate and operation of related smelting facilities are expected to cease by the end of March 2027. Receipt of E-Scrap and shredder dust is expected to be suspended or transferred to other sites. A capital increase of up to ¥23.0 billion is expected to be implemented by 30 June 2026. Operations at the electrolytic plant, PGM plant and casting plant, among others, will continue. |
Items this document does not state (13)
These are items the company does not state in this document. We do not leave them blank, nor fill them in from other sources or by inference.
The reasons the company gives
The company's own explanation, not something inferred from the numbers.Intensifying competition with overseas smelters, a substantial deterioration in the TC/RC terms for purchasing copper concentrate, and uncertainty regarding the outlook have made it difficult to secure the profitability of the copper concentrate processing business. The capital increase is intended to fundamentally improve 小名浜製錬's profitability and strengthen its financial position.