Yushiro Chemical

Yushiro Chemical reported operating profit for the quarter – the second of its fiscal year that will end in March 2024 – of ¥1.1 billion yen (U.S. $7.3 million), a 538% jump from ¥170 million. Operating Income increased due to improved profitability despite raw material prices being at a high level, the company noted in its earnings report.

Sales rose 13% to ¥13.1 billion in the quarter, compared to ¥12.4 billion. Although sales differed among the Japanese automakers that are its main customers, the impact of production cuts due to the easing of shortages in semiconductors and other parts is gradually decreasing, the company noted, and the recovery trend continues.

Profit for each of Yushiro’s regional business segments is based on operating income. The earnings summary includes figures for the first six months of its fiscal year, from March through September.

In its domestic Japan market, Yushiro reported that operating income rebounded to ¥479 million, compared to a ¥171 million loss. Sales increased 16% to ¥9.8 billion. Although the impact of the global semiconductor shortage has not yet fully recovered, the company noted in its earnings summary, sales price revisions have had an impact, and the situation has turned around significantly.

In the Americas segment, operating income surged 187% to ¥1.2 billion. Sales rose 25% to ¥9.9 billion. The company said business was strong, mainly in North America, and sales and profits increased significantly, even though customers were affected by the decline in demand.

In China the company turned a ¥6 million operating loss, compared to a ¥162 million operating profit. Sales declined 3% to ¥2.7 billion. Yushiro noted that amid the economic slowdown, sales volume did not increase due to low operating rates at Japanese automakers, resulting in the decline in revenue. The company said that the difficulty in revising prices in China because of intensified competition led to it posting a small operating deficit.

In Southeast and Asia, segment profit rose 69% to ¥284 million, from ¥168 million. The region’s sales rose 20% to ¥3.1 billion. The company pointed out that customer occupancy rates remained stead at each location, and some locations progressed in revising customer sales prices, which couldn’t be implemented in the previous fiscal year, resulting in increased sales and profits.

KH Neochem

Specialty chemical maker KH Neochem reported operating profit of ¥2 billion in the third quarter for its performance material segment, a 5% improvement.

The segment’s net sales increased 3% to ¥12.3 billion. KH Neochem’s sales volume increased compared to the same period last year, when there were production troubles, the company said in its earnings presentation. Although the international market declined, raw material and fuel costs were increasingly reflected in sales prices, the company said.

The company specializes in oxo reactions for producing alcohols and esters. Yushiro sells derivatives, including 2-ethylhexanoic acid and isononanoic acid, which function as raw materials in lubricants. The company also manufactures fatty acids, esters and feedstocks for refrigeration compressor lubricants.

The company noted that during the third quarter, air conditioner production in China remained strong until July, thanks to a heat wave, although sales volume decelerated sharply from August amid the continuing slump of the Chinese real estate market. Air conditioner sales were also sluggish in other regions, such as Europe, the United States and Japan, the company pointed out.