Zeon Corp. seeks to double elastomers earnings by 2026

TOKYO—Zeon Corp. has set out details of the second phase of its medium-term business plan, under which it aims to raise profitability and "polish up" existing businesses.

Under the strategic plan, the Japanese group aims to promote "structural reform" with emphasis on capital efficiency within its elastomers business unit.

With sales of $1.7 billion, the synthetic rubbers, latex and rubber chemicals unit contributed 57 percent of group sales in fiscal 2022, ended March 31.

Under the 2023-26 plan, the elastomers unit's share of overall sales is expected to reduce to 48 percent, at 1.75 billion, said Zeon in a March 7 presentation.

Operating income for the unit, however, is targeted to reach $165 million, up from $76 million reported last year and $50 million expected this year.

Zeon plans to achieve its targets by implementing "active new investments" and expanding R&D.

This will be part of a $1.5 billion investment plan group-wide, including $1.2 billion in new projects and about $360 million for maintenance and renewal.

The announcement on June 7 highlights the second phase of Zeon's 10-year growth plan through 2030.

During the first phase—2020-22—Zeon invested, among other projects, in carbon neutral processes as well as the expansion of production capacity for its hydrogenated nitrile rubber.

The company completed a 10-percent increase of capacity for Zetpol HNBR production at its facility in Takaoka, Japan.

Also, the group expects to complete a 25-percent HNBR capacity expansion at its plant in Texas by 2025.