Japanese rubber major Fukoku reports 66% decline in profits on rising costs

TOKYO—Fukoku Co. Ltd. has reported a 66.6-percent year-on-year decline in operating profit, to $3.26 million on first-quarter consolidated net sales 2.2 percent higher at $141.5 million.

The Japanese rubber company linked the earnings decline to the impact of increases in raw material costs, transportation costs, and fuel costs over the three months to June 30.

At the group's Functional Parts business net sales decreased year-on-year by 10.1 percent to $57.6 million due to the impact of microchip shortages on automotive production. Income fell 41.2 percent year-on-year to $5.43 million on rising raw materials and transportation costs.

Fukoku's Anti-Vibration Parts business posted a 13.7-percent year-on-year decline in net sales to $58.9 million despite "steady orders" for construction machinery. Segment income decreased 44.9 percent year-on-year to $2.03 million due to "surging" materials costs.

At the group's hose business, net sales increased 3.3 percent year-on-year to $9.04 million, but raw material hikes pushed income down 62.7 percent to $248,000.

Focused mainly on rubber raw materials, Fukoku specializes in rubber raw material compounding, bonding, surface modification and molding technologies.

Fukoku claims to be the world's largest producer, by volume, of wiper blade rubbers used in automotive vehicle—200 million units per year—train, ship and aircraft applications.

The company also claims high global shares in products such as viscous mounts for hydraulic excavators, valves for evaporation-purge devices and wire saw rollers for silicon wafer production.