Zeon's elastomers unit returns to profit in fiscal first quarter

TOKYO—Zeon Corp.'s elastomers business saw a reversal of a loss quarter-on-quarter as it reported a positive earnings figure for its fiscal first quarter.

For the three months to June 30, the synthetic rubbers, latex and chemicals business posted net sales of about $362 million (Yen 52 billion), down 2 percent year-on-year and 5 percent quarter-on-quarter.

At $17.4 million, operating income fell 39 percent year-on-year but represented recovery from a loss of about $14 million in the previous quarter, Zeon reported July 27.

"Synthetic rubber boosted operating income for the elastomer business overall due to (currency effects) and the reversal of loss on disposal and valuation for inventories," the company said.

Overall volumes were down 13 percent year-on-year across all three segments, reflecting 6-percent lower synthetic rubber volumes, as well as 32-percent and 20-percent dips for latex and chemicals respectively.

The value of the elastomers unit's sales declined on lower volumes and selling prices, though synthetic rubber revenues lifted 8 percent to $278.9 million.

This was despite synthetic rubber sales being impacted by economic slowdown in China, especially in general-purpose applications, according to Zeon's report.

Meanwhile, it said, a slow recovery in demand hit the chemicals unit, and changes in the supply-demand balance for medical gloves weighed on latex sales.