Segment Information

Last Update : May, 2016

Mineral Resources Segment

Sumitomo has been involved in the mineral resources business ever since the discovery of the Besshi Copper Mine in 1690. The technologies cultivated through the years at Besshi have subsequently been carried on at the Hishikari Gold Mine, which opened in 1983. Today Hishikari ranks among the world’s foremost sources of gold – a precious commodity the mine continues to produce in significant quantities.
In addition to its mineral resource operations in Japan, Sumitomo Metal Mining has for many years engaged in the development of mines overseas. Today the company is actively undertaking exploration at its own mines and participating in the development of jointly owned mines at points all around the globe.
Going forward, the company will continue striving for stable operation of its gold mines at Hishikari and Pogo, in Alaska, and will vigorously carry forward with further development of gold, copper and nickel resources.

Outline of performance for FY2015

  • The production volume of gold at the Hishikari Mine in FY2015 was 6.9 metric tons.
  • Gold production at the Pogo Gold Mine was lower than the previous year due to a decline in the grade of gold ore, and the production volume for FY2015 was 8.8 metric tons.
  • With regards to overseas copper mines, the expansion project at the Morenci Copper Mine was completed in May 2015 and the production volume increased greatly. The expansion project at the Cerro Verde Copper Mine was also completed at the end of March 2016, and production is expected to grow henceforth. The Sierra Gorda Copper Mine started commercial production in July 2015, but due to factors including a delayed launch and a fall in metal prices, the mine incurred a loss.

Projections

  • An agreement was reached in February regarding the acquisition of additional interest in the Morenci Copper Mine, and the procedures for acquisition were completed in May. As such, high quality resources are expected to be assured henceforth.
  • Measures to decrease losses by increasing operating rate and reducing costs will be implemented at the Sierra Gorda Copper Mine.
  • With regards to gold, a production volume of 6.0 metric tons is planned at the Hishikari Mine in consideration of the maximization of the mine life.

Smelting & Refining Segment

Equipped with the world’s highest level of technologies, Sumitomo Metal Mining produces and markets metal materials of outstanding grade. In Japan the company has two bases, both in Ehime Prefecture: the Toyo Smelter & Refinery producing copper and the Niihama Nickel Refinery producing nickel. Overseas bases include Coral Bay Nickel Corporation and Taganito HPAL Nickel Corporation, both in the Philippines.
Because smelting and refining operations have an impact on the environment, today the company is developing technologies targeted at further reducing CO₂ and other harmful emissions.

Outline of performance for FY2015

  • With regards to copper smelting and refining, regular maintenance were carried out at the Toyo Smelter & Refinery (Ehime prefecture) for the first time in two years, but production of approximately 420,000 metric tons was achieved as planned.
  • With regards to nickel smelting and refining, stable production continued at both Taganito HPAL Nickel Corporation and Coral Bay Nickel Corporation in the Philippines. Production at the Niihama Nickel Refinery and the Harima Refinery also proceeded smoothly.

Projections

  • As copper smelting and refining can ensure a stable smelting and refining margin, competitiveness shall be increased henceforth through sustained operating rate and cost reduction.
  • With regards to nickel smelting and refining, while a situation in which rapid price recovery is unlikely is expected to continue, costs will be steadily decreased and profit ensured through stable operation of the Taganito and Coral Bay HPAL plants.

Materials Segment

Metals of all kinds, in the form of semiconductor materials and functional materials, are widely used for various purposes: copper for electrical circuitry, nickel powder for capacitors, and indium for liquid-crystal displays, to name a few. Sumitomo Metal Mining has been involved in the materials business since 1960. Today, applying technologies developed through the years, the company is processing metals into ever more advanced products meeting the latest needs of its customers.

Outline of performance for FY2015

  • With regards to battery materials, sales increased significantly thanks to healthy demand for automotive batteries. Furthermore, a new plant was completed in March 2016 in the form of Sumiko Energy Materials Co., Ltd.'s Nahara Plant in Fukushima.
  • With regards to crystal materials, demand for materials for smartphones was healthy, and production increased at Sumiko Kunitomi Denshi, Ohkuchi Electronics, and the Ome District Division.

Projections

  • With regards to battery materials, increased demand for materials for automotive batteries is expected so we shall continue to increase production.
  • Production of crystal materials (lithium tantalate substrates and lithium niobate substrates) that are used in SAW filters for smartphones shall be steadily increased.
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