Profits Up at Yushiro, KH Neochem, GS Caltex


Profits Up at Yushiro, KH Neochem, GS Caltex

Second quarter profits for metalworking fluids and industrial fluids manufacturer Yushiro Chemical received a boost from the easing of the global semiconductor shortage, which increased automotive plant utilization globally.

Specialty chemical producer KH Neochem also reported higher profit and sales, while profits jumped 47% for GS Caltex’s base oils and lubricants business.

Yushiro Chemical

Yushiro reported that operating income for the quarter ending June 30 – the first quarter of its fiscal year that started April 1 – surged 250% to ¥686 million, compared to ¥196 million during the same quarter of 2022.

Sales jumped 22% to ¥12.4 billion in the quarter. The increase came about as the impact of production cutbacks diminished, the company noted, due to an easing in the shortage of semiconductors, though the impact differed among major Japanese automakers.

Profit for each of Yushiro’s regional business segments is based on operating income.

In its domestic Japan market, Yushiro reported a ¥314 million operating profit in the quarter, rebounding from a ¥99 million operating loss. Sales rose 21% to ¥4.9 billion. Although sales volume in the country hasn’t fully recovered due to the impact of the global semiconductor shortage, the company note that sales rebounded in part due to the impact of the company’s sales price revision.

In the Americas segment profit jumped 97% to ¥480 million. Sales ramped up 29% to ¥4.7 billion. The company described the United States economy as solid in the quarter. According to Yushiro, sales and profits increased sharply due to a rapid recovery at business sites that had been affected by a decline in customer utilization rates in the previous fiscal year.

In China, segment profit swung to a ¥65 million operating loss, compared to a ¥47 million operating profit, while sales decreased 2% to ¥1.2 billion. The company noted that economic recovery in China was below expectations. Sales volume declined due to sluggish utilization rates at automotive manufacturers, the company noted.

In Southeast and Asia, segment profit improved 20% to ¥128 million, while sales increased 24% to ¥1.6 billion. The company pointed to a strong utilization rate at its customers’ sites in the region, and said sales benefited from it revising sales prices, which could not be implemented in the prior fiscal year.

KH Neochem

KH Neochem reported operating profit of ¥2.3 billion in the second quarter for its performance materials segment, improving from ¥1.6 billion. The company said the profits for its refrigeration lubricant raw materials increased in the first half of the year because it offset the negative impact of a drop-off of inventory benefits by steadily passing on costs such as liquid natural gas, to selling prices.

The segment’s net sales rose 32% to ¥12.9 billion. The company noted that in the first half of the year, its sales volume of refrigeration lubricant raw materials increased significantly from the same period last year, when earthquake and production troubles occurred.

The company specializes in oxo reactions for production of alcohols and esters. Yushiro sells derivatives, such as 2-ethylhexanoic acid and isononanoic acid, which are used as raw materials in lubricants. The company also produces fatty acids, esters and feedstocks for refrigeration compressor lubricants.

The company noted that in the first half of the year, the refrigeration lubricant market was subject to inventory adjustments. Demand for air conditioners remained strong in China thanks to a heat wave, although its real estate market continued to slump, KH Neochem noted.

GS Caltex

GS Caltex reported operating profit of ₩150.6 billion (U.S. $112.5 million) for its base oil and lubricant business in the second quarter, improving from ₩102.5 billion. Revenue for the quarter decreased 9% to ₩508.5 billion, compared to ₩557.9 billion.

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