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  • Source : Press Release
  • Date : 2022-02-03
  • Companies : Tosoh Corp.

Tosoh Reports on Its Consolidated Results for the First Nine Months of Fiscal 2022

Tokyo, Japan—Tosoh Corporation is pleased to announce its cumulative consolidated results for the first three quarters of its 2022 fiscal year, from April 1, 2021, to December 31, 2021.

The company’s consolidated net sales for the nine-month period under review were ¥669.5 billion (US$6.0 billion), up ¥152.8 billion, or 29.6%, from the same period of fiscal 2021. The rise in net sales was attributable to increases in sales prices that reflected increased prices for raw materials and fuels, such as naphtha, including in overseas product markets, and to heightened sales volumes driven by a recovery in demand.

Operating income also increased, ¥56.3 billion, or 111.2%, to ¥106.9 billion (US$962.2 million), from the same period one year earlier. This increase was due to improved trade conditions, whereby high raw material and fuel prices were more than offset by higher sales prices.

Ordinary income rose ¥63.7 billion, or 124.2%, compared with the same period in fiscal 2021, to ¥114.9 billion (US$1.0 billion). Profit attributable to owners of the parent company, in turn, rose ¥42.9 billion, or 124.5%, to ¥77.4 billion (US$696.7 million).

During the first nine months of Tosoh’s 2022 fiscal year, the Japanese economy continued to show signs of recovery. This was due to progress in COVID-19–related vaccinations in Japan and to improved overseas demand amid the lingering effects of COVID-19 infections. The outlook for the domestic economy for rest of the year, however, remains uncertain, as infections are again soaring, causing concern for renewed restrictions on social and economic activities.

Outside Japan, meanwhile, restrictions on economic activities have eased and demand is recovering, particularly in developed countries. There are concerns, though, that global economic recovery will be impeded by intermittent waves of COVID-19 infections, soaring resource prices, rising and prolonged inflationary pressures, and disruptions in the global supply chain.

Results by Business Segment

Petrochemical Group

Petrochemical Group net sales increased ¥44.3 billion, or 48.7%, to ¥135.3 billion (US$1.2 billion). The group’s operating income likewise increased, ¥9.8 billion, or 331.9%, to ¥12.7 billion ($114.3 million). Increases in shipments of a wide range of products and in prices for raw materials, such as naphtha, improved the difference between product receipt and payment, and that, in turn, contributed to the rise in operating income.

The group’s shipments of propylene and cumene rose on the strength of increased production volume given that calendar 2021 was not a scheduled maintenance year. The prices of these products, moreover, were driven upward by increased costs for raw materials and fuels, including naphtha, and by improved conditions for them overseas.

Shipments by the group of its polyethylene resin rose domestically and globally amid recovering demand. Product prices likewise increased, reflecting the rise in naphtha prices and the improvements in overseas market conditions. The group’s shipments of chloroprene rubber, primarily to Asia, also increased in line with a recovery in demand.

Chlor-alkali Group

The Chlor-alkali Group’s net sales amounted to ¥257.2 billion (US$2.3 billion), an increase of ¥66.5 billion, or 34.9%, compared with the same nine-month period in fiscal 2021. Its operating income also increased, ¥30.0 billion, or 146.2%, to ¥50.5 billion (US$454.5 million), the result of improved trade conditions for its vinyl chloride products and urethane raw materials.

The group’s shipments of caustic soda, primarily for export, fell, but caustic soda prices rose in keeping with overseas market prices. Its shipments of vinyl chloride monomer and polyvinyl chloride resin, on the other hand, decreased because of drops in their production volumes. But the prices of its vinyl chloride products increased to mirror their heightened prices in overseas markets and the increased cost of their naphtha raw material.

Domestic shipments of cement by the group fell amid sluggish demand.

Domestic and overseas shipments by the group of its methylene diphenyl diisocyanate (MDI), however, increased. This was due to the steady operation of Tosoh’s MDI production subsidiary in China following its shutdown in the previous fiscal year amid the spread of COVID-19 and to the global recovery in demand for MDI. MDI prices rose, too, in line with overseas market prices.

Shipments of the group’s hexamethylene diisocyanate hardening agents increased domestically and abroad because of a recovery in demand, and prices rose in tandem with overseas market prices.

Specialty Group

Net sales by the Specialty Group increased ¥34.8billion, or 26.2%, to ¥167.7 billion (US$1.5 billion), compared with the first three quarters of the previous fiscal year. Specialty Group operating income increased to ¥34.1 billion (US$306.9 million), a rise of ¥16.1 billion, or 89.6%, that was mostly attributable to a recovery in demand that raised sales volume.

The group’s shipments of ethyleneamines increased domestically and overseas owing to a recovery in ethyleneamines demand. Ethyleneamines prices likewise increased, in line with rising overseas market prices.

Among its separation-related products, the group was able to increase its shipments of liquid chromatography packing materials to countries in Europe and to the United States and China. It was also able to elevate shipments of the in vitro diagnostic products in its diagnostics lineup, domestically and to the United States and markets in Europe and Asia, as demand for such products recovered.

Demand likewise recovered for high-silica zeolite, primarily for use in automotive exhaust gas catalysts. That facilitated an increase in the group’s shipments of high-silica zeolite, in Japan and abroad. Its shipments of zirconia for use in dental materials also increased in line with a recovery in demand. Growing demand for semiconductors, meanwhile, boosted the group’s shipments of silica glass. The group increased, too, its shipments of electrolytic manganese dioxide, mainly for dry cells.

Engineering Group

Engineering Group net sales rose to ¥81.5 billion (US$733.6 million), an increase of ¥8.9 billion, or 12.3%, compared with fiscal 2021’s first three quarters. The group’s operating income likewise increased, ¥500.0 million, or 7.6%, to ¥7.4 billion (US$66.6 million).

The Engineering Group’s water treatment business increased its sales through steady progress in the construction of large-scale projects domestically and overseas. Orders came mostly from the electronics industry.

Sales by the group’s construction subsidiaries also rose.

Ancillary

Ancillary net sales for the first three quarters of fiscal 2022 decreased ¥1.8 billion, or 6.0%, to ¥27.8 billion (US$250.2 million), compared with the same period a year earlier. Operating income likewise fell, ¥100 million, or 5.9%, to ¥2.1 billion (US$18.9 million).

Sales by ancillary trading companies and other operations decreased during the period under review.

Summary of Financial Position

Tosoh Corporation’s total assets grew ¥87.3 billion from the end of fiscal 2021, reaching ¥1,070.1 billion (US$9.6 billion) to close out the nine months ended December 31, 2021, mainly because of an increase in trade receivables and contract assets. The company’s total liabilities increased ¥23.0 billion over the first three quarters of fiscal 2022, to ¥344.1 billion (US$3.1 billion), owing chiefly to an increase in trade payables. Its net assets amounted to ¥726.0 billion (US$6.5 billion), an increase of ¥64.3 billion from the end of fiscal 2021 that was mostly the result of profit attributable to owners of the parent company.

Revision of Consolidated Performance Forecast

In light of recent trends in its business performance, Tosoh Corporation has revised its full-year fiscal 2022 consolidated financial results forecast of November 2, 2021.

 

Net Sales

Operating Income

Ordinary Income

Profit Attributable to Owners of the Parent Company

Earnings per Share (yen)

Previous forecast (A)

¥890 billion

¥116 billion

¥121 billion

¥80 billion

251.44

Revised forecast (B)

¥910 billion

¥136 billion

¥145 billion

¥96 billion

301.71

Difference (B – A)

¥20 billion

¥20 billion

¥24 billion

¥16 billion

 

% Difference

2.2

17.2

19.8

20.0

 

Reference: FY 2021 performance (Year ended March 2021)

¥733 billion

¥88 billion

¥95 billion

¥63 billion

197.89

For details, please refer to “Tosoh’s Revised Full-Year Fiscal 2022 Consolidated Results Forecast,” released on the same day.

TOSOH CORPORATION

Who We Are

Tosoh Corporation is the parent of the Tosoh Group, which comprises over 100 companies worldwide and a multiethnic workforce of over 12,000 people. It generated net sales of ¥732.9 billion (US$6.9 billion at the average rate of ¥106.1 to the US dollar) in fiscal 2021, ended March 31, 2021.

What We Do

Tosoh is one of the largest chlor-alkali manufacturers in Asia. The company supplies the plastic resins and an array of the basic chemicals that support modern life. Tosoh’s petrochemical operations supply ethylene, polyethylene, and functional polymers, while its advanced materials business serves the global semiconductor, display, and solar industries. Tosoh has also pioneered sophisticated bioscience systems that are used for the monitoring of life-threatening diseases. In addition, Tosoh demonstrates its commitment to a sustainable future in part by manufacturing a variety of eco-products.

Stock Exchange Ticker Symbol: 4042

DISCLAIMER

This document may contain forward-looking statements, including, without limitation, statements concerning product development, objectives, goals, and commercial introductions, which involve certain risks and uncertainties. Forward-looking statements are identified through the use of the word anticipates and other words of similar meaning. Actual results may differ significantly from the results expressed in forward-looking statements.