Zeon elastomers unit delivers higher sales, earnings

Tokyo – Zeon Corp.’s elastomer business has posted a strong second quarter, despite increasing costs for raw materials and logistics, the Japanese group has reported.

Over the three months to end of September, operating income rose 10% year-on-year to Yen5.3 billion, on 15% higher sales at Yen58 billion, according to a 31 Oct Zeon statement.

During the period, Zeon said price adjustments and exchange rate effect helped earnings by a total of Yen3.8 billion, offsetting the Yen2.6 billion negative impact of lower sales volumes, energy and inventory and other costs.

For the first half of its fiscal 2022 (ending 31 March 2023), Zeon's operating income fell 14% to Yen9.3 billion, reflecting a Yen18-billion negative impact of raw materials and energy costs and Yen4.5-billion negative effect of ocean freight and indirect charges.

Second quarter sales volumes were down 10% year-on-year, with synthetic rubber materials posting a 4% decline, latex products a 27% decline and rubber chemicals a 10% decrease.

Net sales, however, increased as synthetic rubbers posted a growth of 28% year-on-year to Yen41.6 billion and chemicals rose 7% to Yen10 billion.

Latex sales fell 37% to Yen4.3 billion during the period.

Zeon linked the higher overall sales to price adjustments, despite declining naphtha prices.

Synthetic rubber volumes were down due to regular repairs at main plants but demand “remain firm”, Zeon noted.