Nippon Shokubai posts 5% drop in full-year profits

08 May 2008 11:35 [Source: ICIS news]

TOKYO (ICIS news)--Japanese chemical producer Nippon Shokubai has posted a 5.4% drop in its full-year operating income, due to the failure to offset higher feedstock costs and capital expenditure on expansion projects, it said on Thursday.

Consolidated operating income for the period ended 31 March totalled yen (Y) 18.4bn ($176.6m), from Y19.4bn in the year-ago period.

Full-year net sales were up 13.6% to Y302.7bn, from Y266.5bn, while net income decreased 15.1% to Y11.9bn, from Y14bn, Nippon Shokubai said.

In its basic chemicals segment, sales of acrylic acid, acrylic ester, ethylene oxide (EO) and higher alcohol increased due to steady demand, the company said.

Sales of ethylene glycol (EG) and ethanol amines also improved on strong market conditions due to production problems in the Middle East as well as increased demand in China, it added.

As a result, the segment recorded a full-year operating income of Y6.7bn, up 24.5% from Y5.4bn in the year-earlier period, while net sales increased 11.9% to Y109.3bn, from Y97.7bn.

Full-year net sales in the functional chemicals segment rose 10.3% to Y155.9bn, from Y141.3bn, on higher sales for most products including super absorbent polymer (SAP), maleic anhydride, detergent raw materials and special ester, the company said.

However, the segment’s full-year operating income fell 19.1% to Y8.8bn, from Y10.8bn, because the company was unable to offset the high feedstock costs with price rises, Nippon Shokubai added.

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By: Tomomi Yokomura
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