Metalworking fluids and industrial oil producer Yushiro Chemical Industry reported lower sales and a steep decrease in operating income for the quarter ending June 30, compared to the same quarter in 2019.
Yushiro said operating income for the quarter – the first in its fiscal year beginning April 1 – dove 84% to 92 million Japanese yen (U.S. $872,000), down from ¥585 million a year earlier.
The company reported sales of ¥7.4 billion ($70 million) for the quarter ending March 31, down 21% from ¥9.3 billion in the year-earlier quarter.
Yushiro summarized sales and profits for the regions in which it does business. The profit for each regional business segment is based on operating income. Yushiro’s sales in Japan declined 30.2% year-on-year to ¥3 billion, and segment profit slipped from ¥243 to a loss of ¥157 million.
In the Americas, sales decreased 4% year-on-year to ¥2.7 billion, and profit dropped 24% year-on-year to ¥209 million.
In China, sales were down 26% year-on-year to ¥775 million, and profit was down 75% to ¥8 million. The company attributed the declines to the suspension of operations by major customers due to the spread of COVID-19 infections.
In Southeast Asia and India, sales were down 19% year-on-year at ¥949 million and profit edged up 2.4% year-on-year to ¥128 million. The impact of the coronavirus in this region was relatively small during the quarter, according to Yushiro.
The company noted in its financial statement the economic impacts of activity restriction related to COVID-19 on consumption and investment, and that the global economy continued to slow during the quarter due to intensifying trade friction between the United States and China. Significant drops in operating rates of Japanese automobile manufacturers and parts manufacturers – the company’s main customers – also impacted Yushiro’s business.