Japan's Teijin sees full-year loss on films JVs

28 April 2008 13:15  [Source: ICIS news]

TOKYO (ICIS news)--Teijin has forecasted an operating loss of the previous fiscal year due to worsened performance in overseas films joint ventures, the Japanese chemical and fibre producer said on Monday.

Teijin forecasted an extraordinary loss of yen (Y) 24.4bn ($233m) and nonoperating expenses, recorded as equity in losses of unconsolidated subsidiaries and affiliates, of Y4.5bn for the full year ended 31 March. As a whole, net impairment loss would affect Y13bn to net income of the year.

The company lowered its consolidated operating income forecast 2.7% to Y65.2bn from Y67bn, previously announced in January.

Net sales for the same period were now expected to be Y1036bn, down 0.3% from the previous forecast, while net income was lowered by 58% to Y12.6bn from Y30bn.

Teijin has films JVs with DuPont of the US in six countries.

Owing to harsh business conditions, particularly in the US films business as a consequence of sagging demand and increasing feedstock costs, the firm’s US joint venture would record an operating loss in the year ended 31 March, the company said in a statement.

Teijin had thus resolved to apply impairment accounting to the fixed assets of its US JV, it said.

In addition, Teijin’s joint venture in Luxembourg was operating in the red, and it planned to apply impairment accounting to the fixed assets of the joint venture, resulting in a loss that would be recorded as equity in losses of unconsolidated subsidiaries and affiliates, the company said.

($ = Y104)

By: Tomomi Yokomura
+65 6780 4359

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