Urban Infrastructure &
Environmental Products (UIEP) Company
Last Update : Sep 30, 2020
Solving infrastructure issues and supporting social infrastructure through a wide range of advanced materials
- Yoshiyuki Hirai President of Urban Infrastructure & Environmental Products Company
- Under the new Medium-term Management Plan that covers the period to fiscal 2022, “contribution to the SDGs with our UIEP* excellence —advancing as a professional company challenging society’s issues—” lies at the heart of the UIEP Company president’s policy. “UIEP excellence” refers to the provision of products that engender considerable peace of mind and trust not only at the development and production stages, but also at every level of the product life cycle, from proposal through sale to customer use, while helping to solve social issues. This can only be achieved by the high quality of each and every member of the UIEP Company as a person, or more appropriately as a professional group. In this sense, UIEP excellence is defined as a level of quality that combines the attributes of both “people” as well as “products.” Honing and perfecting this UIEP excellence will not only ensure sound business results, but also allow us to be genuinely “REBORN” both in name and in reality.
* UIEP: Urban Infrastructure & Environmental Products
The Urban Infrastructure & Environmental Products (UIEP) Company is a manufacturing and sales leader in Japan in the water sewerage and supply pipe systems as well as construction materials supply businesses, which collectively form the company’s core operating platform. In recent years, we have taken steps to promote the increased use of prioritized products while creating new markets to help solve a wide range of increasingly serious and complex social issues including labor shortages, aging infrastructure, and climate change. Overseas, the company is looking to further expand its business in Asia and Europe, focusing mainly on synthetic sleepers (FFU) for railroads, which reduce environmental impact, and the SPR method for rehabilitating aging sewage pipes. We are also selecting areas where we can horizontally deploy models that have been successful in Japan while increasing the number of world-class products with the aim of expanding and cultivating new fields
Risks and Opportunities
The UIEP Company’s business results are impacted by a variety of factors including a drop-off in private-sector construction demand and trends in public works spending. The company’s performance is also susceptible to the risk of a delay in construction due to the recent shortage of labor as well as the spread of the COVID-19 pandemic. In contrast, these risks can provide the company with a host of business opportunities. Against this backdrop, the UIEP Company is committed to providing piping materials that help avoid the 3C's of closed spaces, crowded places, and close-contact settings at the construction frontline, while at the same time saving labor, and products that contribute to natural disaster prevention and mitigation.
Residential water supply and
Plant products with high corrosion and chemical resistance
Sewage (Spirally) Pipe Renewal (SPR) Method
Large bathrooms for nursing care facilities (Wells)
High performance resin tatami mats (MIGUSA)
Synthetic railway sleepers (FFU)
Performance Highlights and a Review of the Previous Medium-term Management Plan
Under the previous medium-term management plan, net sales in the UIEP Company came to ¥237.4 billion in fiscal 2019, down 1% compared with fiscal 2016. This largely reflected efforts to withdraw from low-margin products in Japan. Despite an upswing primarily in such fixed costs as depreciation on the back of investments aimed at fortifying the business base including growth investments and production reorganization, operating income climbed 21% compared with fiscal 2016. This was mainly due to the increase in sales of high-value-added prioritized products with the potential for market growth as well as high-value-added products overseas and successful efforts to secure a spread between selling prices and raw material costs. High-value-added prioritized products, in particular, exhibited an annual growth rate of 9% during the period of the previous medium-term management plan. While overseas sales expanded 18% compared with fiscal 2016, results struggled owing to the impact of market conditions in fiscal 2019. Looking ahead, improving the profitability of general products, which are expected to experience a downturn in demand including a drop in housing construction starts, and efforts to accelerate the pace of overseas expansion are projected to pose a challenge.
Medium-term Management Plan Drive 2022（FY2020-2022）
Net sales are forecast to increase slightly in fiscal 2022 compared with fiscal 2019. In our core business, which largely revolves around general products, results in the future will be impacted by a downturn in housing construction starts. While continuing to further expand sales of prioritized products that help solve increasingly serious and complex social issues, the UIEP Company will work to expand and deepen areas overseas where it can deploy case studies that have been successful in Japan. From a profit perspective, energies will be directed toward increasing overseas sales of prioritized products, expanding overseas business, securing a spread between selling prices and raw material costs, and promoting rationalization investments. Based on these endeavors, the UIEP Company will target an increase of ¥4.5 billion in operating income. In addition, every effort will be made to further reorganize production and invest in automation through digital transformation (DX). Moving forward, the UIEP Company will endeavor to realize thoroughgoing low-cost operations as well as unmanned factory night shifts while at the same time continuing to reform its business portfolio and increase the efficiency of logistics in a bid to optimize invested capital.
Growth Strategy (Expand Sales of Prioritized Products)
Solve growing, complex social issues through prioritized products that combine SEKISUI CHEMICAL’s technologies.
Prioritized Product Sales
Social Issues and SEKISUI CHEMICAL Technologies
- AC DRAIN PIPE
Vinyl chloride pipe for drains with a layer to prevent condensation; contributes to an easier heat retention process for air conditioner work in public schools while also protecting children from heat stroke
- ESLO HYPER AWHP
Earthquake-resistant high-performance polyethylene pipe for high-rise construction; based on its flexible and lightweight properties, excellent substitute for metal piping; easy to install and contributes to the prevention of closed spaces, crowded places, and close-contact settings at post COVID-19 construction sites
Growth Strategy (Expand Overseas Business)
In addition to diversifying business and products focusing on Asia and Europe, develop examples of success in Japan mainly in high-value-added products and work to expand and deepen areas.
Sales by Overseas Area * Including the export of domestic products
- Synthetic Sleepers for Railroads (FFU)
Fiber-reinforced foamed urethane (FFU) railway sleeper that boasts excellent water-resistant durable properties; requiring no preservatives, contributes to the reduction of environmental impact; plans to establish a production base in Europe, where demand is strong, further expand operations
- Pipeline Renewal (SPR Method)
Method to line the inner surface of existing pipes; in addition to eliminating the need to dig up roads, the SPR method helps reduce labor while shortening the time required for construction; unaffected by changes in the weather, the SPR method also reduces noise levels during construction; realizes substantial reductions in waste
Medium-term Management Plan and Growth Strategies for the Three Strategic Fields
Piping and Infrastructure
The UIEP Company supplies a wide range of piping materials, including water supply/drainage and air conditioning pipes for residences and buildings, high-performance pipes for plants, and other pipes for such social infrastructure as water supply/sewerage systems in the public sector as well as agricultural water, electricity and gas supply systems that are easy to install and help shorten construction periods. In addition to pipeline renewal materials that serve as a countermeasure for aging infrastructure, the company supplies emergency use products including disaster-use manhole toilets. As the market has become aware of their conventional earthquake and corrosion resistance properties, plastic pipes have been increasingly used to replace metal pipes. Moreover, in light of such enhanced features as pressure resistance and high drainage, the potential for substitution from metal piping is expanding.
ESLON Fire-resistant VP Rigid PVC pipes and Fittings for Buildings
The industry’s first fire-resistant plastic pipe that is comprised of a polyvinyl chloride (PVC) layer and a specially blended intermediate layer that expands at high temperatures to form an insulating and fireproof coating. Eliminating the need to an additional fireproof layer, ESLON fire-resistant VP rigid pipes enable easy installation while serving as a countermeasure against the shortage of labor.
Building and Living Environment
The UIEP Company provides materials for interior use including prefabricated baths, nursing care as well as independent living facility equipment, the functional (artificial) tatami (MIGUSA), and decorative plastic sheets for interior and furniture application. The company also supplies construction materials for external use such as rain gutters. While sales are on a gradual downward trend due to the withdrawal from low-margin products, sales of new products that are designed to address climate change (counteracting torrential rain) and alleviate the burden associated with caring for the elderly are on the rise.
High Flowrate Drainage System
The high flowrate drainage system is a siphon-type rainwater drainage system that secures a sufficient amount of drainage to cope with torrential rain without increasing the pipe diameter. This system helps to mitigate disasters as a product that responds to serious disasters.
The UIEP Company supplies plastic molding sheets for aircraft cabin interiors, construction exteriors, and medical equipment casings, synthetic lumber (FFU) for railway sleepers, sound insulation materials, and other materials for air and rail transport infrastructures. High-performance containers are also provided for medical and industrial use. Moreover, the company is working on developing markets for new technologies and new materials such as thermoplastic CFRP. There is significant room for growth in the functional material field as a whole, including overseas expansion. Every effort will be made to accelerate the rollout of multiple high value-added product applications.
The company’s flame-retardant impact-resistant sheets have exceptional design qualities. Along with helping to reduce the weight of machinery, these sheets also improve the fuel efficiency of transport equipment. In the future, energies will be directed toward accelerating expansion in medical and sanitary applications.