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Business
Japanese Rebound
Sumitomo, Mitsubishi, and others post strong first-half results
by Jean-François Tremblay
November 15, 2004
| A version of this story appeared in
Volume 82, Issue 46
ASIA-PACIFIC
Sumitomo, Mitsubishi, and others post strong first-half results
Buoyed by strong domestic and regional demand, Japan's largest chemical companies improved their profits sharply in the first half of the fiscal year that ends March 31, 2005.
Brisk sales of flat-display materials and photoresists led to spectacular results at Sumitomo Chemical. The company tripled its net profit compared with a year ago by quadrupling operating income in electronic materials, returning to profitability in petrochemicals, doubling profits from fine chemicals, and improving its pharmaceuticals business.
At Mitsubishi Chemical, results from all of the company's businesses improved, but the advance was sharpest in petrochemicals, where operating income increased five times compared with last year's first half. Mitsubishi cites the strength of Chinese demand as the main reason for higher petrochemical margins.
Teijin's net income surged nearly 2.5 times, even though sales contracted slightly as a result of a business sale. Basic chemicals helped Asahi Kasei increase net income by 162%.
Long lagging, the profitability of Japanese chemical companies is now comparable to that of their Western counterparts. Sumitomo's net profit margin of 4.9% in the first half is only slightly behind the 6.1% profit margin reported by Dow Chemical in its latest quarter.
| JAPANESE FIRST HALF Earnings improve, most sharply at Sumitomo and Asahi | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| NOTE: Monetary figures were calculated at a rate of $1.00 = 110.20 yen. a After-tax earnings. b After-tax earnings as a percentage of sales. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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