Japan : Caprolactam & acrylonitrile sales up at Sumitomo Chemicals

The Japanese economy continued its moderate growth because of an increase in capital expenditure thanks to improving corporate profits, as well as solid exports supported by Asian economic growth, particularly in China.
Meanwhile, factors such as rising crude oil prices and a sense of instability in international financial markets may be causes for concern about their impact on corporate performance and consumer spending.
Although shipments of products such as IT-related products showed signs of a recovery, Sumitomo Chemical’s overall business faced a challenging operating environment, with prices for naphtha, benzene and other feedstocks rising sharply and competition in each business area intensifying.
Under these circumstances, the Sumitomo Chemical Group worked to improve business performance by promoting price increases, cutting costs by streamlining and expanding sales through marketing drives.
As a result, consolidated interim sales increased by ¥77.3 billion over the same period the previous year to ¥931.9 billion, while factors such as a steep rise in the price of feedstocks resulted in year-on-year declines in profits.
Operating income was ¥48.4 billion, ordinary income was ¥57.7 billion, and interim net income was ¥26.4 billion. Non-consolidated interim sales were ¥444.9 billion and net income was ¥18.7 billion. Sumitomo Chemical decided to pay an interim dividend of ¥6 per share.
Sales of raw materials for synthetic textile fibers such as caprolactam and acrylonitrile as well as methyl methacrylate and other products increased because of a rise in product prices on the back of solid demand and a rise in feedstock costs. As a result, the segment’s sales increased by ¥10.3 billion over the same period last year to ¥159.8 billion. Operating income increased by ¥2.0 billion year on year to ¥7.9 billion, benefiting from rising Asian market prices for methyl methacrylate.