TOKYO, Aug 9, 2016 - (JCN Newswire) - Showa Denko ("SDK"; TSE:4004) announces that the actual financial results for the first half of 2016 reported today are different from the forecast announced on February 10, 2016. Based on that, and taking into consideration the recent business trends, SDK revises its performance forecast for full-year 2016.
1. Differences between forecast and actual consolidated business results for Jan.1 - June 30, 2016
(Millions of yen, excepting profit attributable to owners of parent per share)
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Net sales Operating Ordinary A B
income income
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Earlier forecast (A) 360,000 10,000 7,500 2,000 14.00
(Announced on February 10, 2016)
Actual results (B) 321,572 11,536 7,010 1,592 11.15
(Announced on August 9, 2016)
(B) - (A) -38,428 1,536 -490 -408
Percentage of changes -10.7% 15.4% -6.5% -20.4%
First half 2015 results
(Reference) 396,980 16,109 15,500 1,280 8.96
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A: Profit attributable to owners of parent
B: Profit attributable to owners of parent per share (yen)
SDK consolidated every ten shares of its common stock into one share on July 1, 2016. The above numbers, both for 2015 and 2016, are calculated on the basis of the number of outstanding shares after this consolidation.
2. Reasons for the differences
Net sales decreased from the earlier forecast due partly to lower-than-expected sales in the Petrochemicals segment, in which the prices of petrochemical products including ethylene were below the forecast made at the beginning of the year because of lower-than-expected raw naphtha price, and also due partly to lower-than-expected sales in the Electronics segment, in which the shipment volumes of HD media were also less than the earlier forecast.
Operating income was higher than the earlier forecast due partly to the significant increase in operating income from the Petrochemicals segment resulting from the continuously strong demand for petrochemical products in Asia. Operating income from the Chemicals, Aluminum and Others segments also increased, while operating income from the Electronics and Inorganics segments was lower than the earlier forecast.
Ordinary income was lower than the earlier forecast due partly to the incurrence of foreign exchange losses caused by the yen's sudden appreciation. Profit attributable to owners of parent was also lower than the earlier forecast.
3. Revised forecast of consolidated business results for Jan.1 - Dec.31, 2016
(Millions of yen, excepting profit attributable to owners of parent per share)
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Net sales Operating Ordinary A B
income income
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Earlier forecast (A) 765,000 36,000 31,000 20,000 140.03
(Announced on February 10, 2016)
Revised forecast (B) 670,000 30.000 23,000 9,000 63.10
(Announced on August 9, 2016)
(B) - (A) -95,000 -6,000 -8,000 -11,000
Percentage of changes -12.4% -16.7% -25.8% -55.0%
2015 results
(Reference) 780,958 33,672 32,225 969 6.78
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A: Profit attributable to owners of parent
B: Profit attributable to owners of parent per share (yen)
SDK consolidated every ten shares of its common stock into one share on July 1, 2016. The above numbers, both for 2015 and 2016, are calculated on the basis of the number of outstanding shares after this consolidation.
4. Reasons for the revision of full-year consolidated performance forecast
Taking recent changes in economic trend including appreciation of the yen into account, SDK revises its assumptions about exchange rate and naphtha price on which the Company forecasts its own performance in the second half of 2016 (July 1 - December 31, 2016) as follows:
Exchange rate: 100 yen to the U.S. dollar (Initial assumption: 119 yen to the U.S. dollar)
Naphtha price: 32,200 yen/kl (Initial assumption: 42,200 yen/kl)
As for the full-year performance forecast, net sales will decrease. Sales in the Petrochemicals segment will decrease due to the lower-than-earlier-forecast tendencies in sales prices of products, reflecting the fall in raw naphtha price, despite continuously tight supply-demand situation. Sales in the Electronics segment will also be lower than the earlier forecast due to an expected decrease in shipment volumes of HD media for use in PCs, which will not be compensated by the increase in shipment volumes of HD media for use in servers.
Operating income will be lower than the earlier forecast. Operating income from the Petrochemicals segment will increase due to continuously high operating rate of our petrochemical plant, reflecting tight supply-demand situation in Asia. Operating income form the Aluminum segment will also be higher than the earlier forecast. However, operating income from the Electronics segment will be lower than the earlier forecast due not only to the influence of the revision in our assumption about exchange rate but also to the lower-than-earlier-forecast shipment volumes of HD media. Operating income from the Inorganics segment will also be lower than the earlier forecast due to the lower-than-expected tendencies in market prices of graphite electrodes.
Ordinary income will be lower than the earlier forecast due to the expected decrease in operating income, in addition to the influence of posting of foreign exchange losses in the first half of 2016. Therefore, profit attributable to owners of parent will also be lower than the earlier forecast.
Press release (PDF): www.sdk.co.jp/assets/files/english/news/2016/20160809_sdknewsrelease1_e.pdf
Contact:
IR Office, Finance & Accounting Department
Phone: 81-3-5470-3323
Topic: Earnings
Source: Showa Denko K.K.
Sectors: Chemicals, Spec.Chem
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