Hedging Foreign Exchange and Interest Rate Risk with Derivatives and Interest Rate Swaps
First written in FY2019. 4 of 12 entries say "Mitigated", first in FY2022. Latest entry: FY2026.
4 other companies' latest entry also says "Mitigated".
- FY2026MitigatedAnnual report
「Interest rate swap transactions Receive floating, pay fixed Long-term borrowings 140,000 70,000」
The notional amount of interest rate swaps decreased from ¥210 million in the previous fiscal year to ¥140 million, while the notional amount with a maturity of more than 1 year decreased from ¥140 million to ¥70 million. - FY2025MitigatedAnnual report
「Interest rate swap transactions Receive floating, pay fixed Long-term borrowings 210,000 140,000」
The notional amount of interest rate swaps decreased from ¥280 million in the previous fiscal year to ¥210 million, while the notional amount with a maturity of more than 1 year decreased from ¥210 million to ¥140 million. No commodity swaps were applicable in the current fiscal year either. - FY2024MitigatedAnnual report
「Interest rate swap transactions Receive floating, pay fixed Long-term borrowings 280,000 210,000」
The notional amount of interest rate swaps decreased from ¥350 million in the previous fiscal year to ¥280 million, while the notional amount with a maturity of more than 1 year decreased from ¥280 million to ¥210 million. No commodity swaps were applicable in the current fiscal year. - FY2024-Q2Elimination of hedging-related balancesAnnual report
「Derivative liabilities － Deferred hedge gains (losses) －」
The derivative liabilities of ¥4.330 million and the negative balance of deferred hedge gains (losses) of ¥5.248 million recognized at the end of the previous fiscal year were no longer recognized at the end of the second quarter accounting period. - FY2024-Q1Changes in hedging-related balancesAnnual report
「Derivative liabilities 4,330 — Deferred hedge gains and losses △5,248 △2,061」
From the end of the previous fiscal year to the end of the first quarter, derivative liabilities changed from ¥4,330 thousand to none, while the negative balance of deferred hedge gains and losses narrowed from ¥5,248 thousand to ¥2,061 thousand. - FY2023ReframedAnnual report
「The Company enters into derivative transactions to avoid the risk of fluctuations in raw material prices, specifically brass, and does not enter into transactions for speculative purposes.」
In addition to hedging interest rate and foreign exchange risk, the Company expanded its hedging structure to include commodity swaps covering fluctuations in brass prices. The contract amount was ¥62.479 million and the fair value was negative ¥4.330 million. - FY2023-Q3Recognition of derivative liabilitiesAnnual report
「Current liabilities increased by ¥63 million from the end of the previous fiscal year to ¥2,453 million. This was mainly due to increases of ¥46 million in notes payable, accounts payable and contract liabilities, ¥15 million in the provision for product warranties, ¥21 million in derivative liabilities and ¥96 million in other current liabilities, partly offset by a ¥127 million decrease in short-term borrowings.」
Derivative liabilities related to derivatives used as hedging instruments for foreign exchange and interest rate volatility increased by ¥21 million from the end of the previous fiscal year. - FY2023-Q2Decrease in deferred hedge gains and lossesAnnual report
「Net assets decreased by ¥18 million from the end of the previous fiscal year to ¥3,862 million. This mainly reflected a ¥5 million increase in valuation difference on other securities, offset by a ¥32 million decrease in deferred hedge gains and losses.」
The Company disclosed that deferred hedge gains and losses, a hedging-related item, decreased by ¥32 million from the end of the previous fiscal year. - FY2022MitigatedAnnual report
「Interest rate swap transactions: floating-rate receipt, fixed-rate payment; long-term borrowings: 420,000; 350,000」
The interest rate swap contract amount decreased from ¥490 million in the previous fiscal year to ¥420 million, while the amount with maturities exceeding 1 year decreased from ¥420 million to ¥350 million. The policy of using them for hedging purposes continues. - FY2021Decrease in interest rate swap contract balancesAnnual report
「Interest rate swap transactions: floating-rate receipt, fixed-rate payment; long-term borrowings: 490,000; 420,000」
Interest rate swap contract amounts decreased from ¥560 million in the previous fiscal year, including ¥490 million with maturities exceeding 1 year, to ¥490 million in the current fiscal year, including ¥420 million with maturities exceeding 1 year. The policy of using them for hedging purposes continues. - FY2020RestatedAnnual report
「The Company uses derivative transactions to avoid risks arising from changes in foreign exchange rates and market interest rates, and does not use them for speculative purposes.」
The policy of using derivative transactions and interest rate swaps for hedging, rather than speculation, in response to foreign exchange and interest rate volatility was reaffirmed. - FY2019First statedAnnual report
「The Company uses derivative transactions to avoid risks arising from changes in foreign exchange rates and market interest rates, and does not use them for speculative purposes.」
For the first time, a thread was created on the policy of using derivative transactions and interest rate swaps for hedging, rather than speculation, in response to foreign exchange and interest rate volatility.