Home> Press Release> Press Release (2007)> Summary of FY2006 Third Quarter Consolidated Financial Results and Business Performance

Summary of FY2006 Third Quarter Consolidated Financial Results and Business PerformancePrint Page

January 31, 2007

Summary of FY2006 First Quarter Consolidated Financial Results and Business Performance

Name of listed company:
ZEON Corporation
(Code: 4205: First Section, Tokyo Stock Exchange and Osaka Securities Exchange)
URL:
http://www.zeon.co.jp/
Representative:
President & CEO Naozumi Furukawa
Contact:
Director and General Manager, Finance & Accounting Dept. Tadayuki Minami
Tel: +81-3-3216-1412

1. Notes Regarding the Compilation of Quarterly Results
(1) Simplified accounting method adopted: Applicable to
  method of depreciation and amortization, calculation standards for corporate taxes, etc.
(2) Change in accounting method since the last consolidated fiscal year (fiscal 2005): None
(3) Change in scope of consolidation and application of equity method for subsidiaries: None
 

2. Summary of Financial Results for the 3rd Quarter of FY2006 (April 1, 2006 to December 31, 2006)

(1) Status Report on Consolidated Management Results

(Rounded to the nearest million yen)

  Net Sales Operating Income Ordinary Income (Quarterly)
Net Income
FY2006 Q3 ¥ (million)
210,150
Change (%)
9.1
¥ (million)
21,401
Change (%)
13.9
¥ (million)
21,319
Change (%)
14.9
¥ (million)
12,247
Change (%)
19.4
FY2005 Q3 192,566 12.2 18,794 43.7 18,557 36.1 10,254 83.2
(Reference)
FY2005
263,074 13.7 26,835 39.0 26,459 40.7 15,249 96.2

  (Quarterly) Net Income Per Share Fully Diluted
(Quarterly) Net Income Per Share
FY2006 Q3 Yen
51.45
Yen
51.44
FY2005 Q3 Yen
42.75
Yen
(Reference)
FY2005
Yen
63.23
Yen

Notes:

  1. Percentages for net sales and operating income show
    year-on-year changes from the corresponding previous period.
     

Qualitative Information Related to Status Report on Consolidated Management Results

Overall
During the third quarter of FY2006, prices of crude oil and naphtha soared to even higher levels than in the previous fiscal year, and while declining somewhat in September 2006, they nevertheless remained at high levels. Demand has been brisk both in Japan and abroad. Under this business environment, ZEON group continued to reduce costs through the ZΣ (Sigma) Activities, while pursuing profit-oriented marketing in the Elastomer segment and endeavoring to develop and expand the sales of new products in the Specialty Materials segment. ZEON group is also seeking to restore profitability by revising its sales prices to reflect the rise in raw material prices.
As a result, in the third quarter of FY2006 net sales increased by ¥17,584 million to ¥210,150 million, up 9.1% from the same quarter of the previous fiscal year. Operating income increased by ¥2,607 million to ¥21,401 million, up 13.9% from the same quarter of the previous fiscal year; ordinary income increased by ¥2,763 million to ¥21,319 million, up 14.9%; and net income rose by ¥1,993 million due to improvements in extraordinary items to ¥12,247 million, up 19.4%.

Elastomer
In the Elastomer segment, demand was on the whole favorable and exceeded the same quarter of the previous year in terms of both quantity and sales, with the exception of synthetic latex, which suffered a considerable decline in sales of products used for paper. We maintained our profit-oriented sales strategy to counter the effects of the rise in raw material prices and subsequent stagnation at high levels. As a result, sales increased by ¥16,781 million to ¥132,235 million, up 14.5% from the same quarter of the previous fiscal year, and operating income rose by ¥1,678 million to ¥12,792 million, up 15.1%.

Specialty Materials
In the Specialty Materials segment, sales of specialty chemicals recovered due to an expansion in the sales of Synthetic Aroma chemicals. With respect to Cyclo-olefin Polymer products, we enjoyed robust sales of ZEONOR® Film for LCD panels and ZEONEX® resin for optical lenses and medical uses. We are currently expanding our facilities to meet growing demand for optical films used in LCD panels. As a result, net sales in the Specialty Materials segment increased by ¥6,817 million to ¥35,687 million, up 23.6% from the same quarter of the previous fiscal year, and operating income increased by ¥1,026 million to ¥8,021 million, 14.7%, as sales prices fell and Sales, General and Administrative Expenses rose.

Others
In the others segment, sales declined as we reduced the scope of sales at the trading division of a subsidiary. As a result, net sales decreased by ¥5,636 million to ¥43,060 million, down 11.6% from the same quarter of the previous fiscal year, and operating income fell by ¥125 million to ¥564 million, down 18.1%.


(2) Changes in Consolidated Financial Condition

  Total Assets Total
Shareholders’
Equity
Equity Ratio Shareholders’
Equity Per Share
FY2006 Q3 ¥ (million)
328,835
¥ (million)
109,238
%
32.1
Yen
444.04
FY2005 Q3 287,005 91,980 32.0 384.80
(Reference)
FY2005
272,674 96,528 35.4 405.10

Qualitative Information Related to Changes in Consolidated Financial Condition

Total assets as of the end of the third quarter of FY2006 amounted to ¥328,835 million, an increase of ¥56,162 million compared to the end of the previous consolidated fiscal year. Notes and accounts receivable-trade increased by ¥23,805 million, tangible fixed assets increased by ¥10,023 million and other current assets increased by ¥14,279 million.
Total net assets amounted to ¥109,238 million due to a ¥12,247 million increase in net income for the period under review.
Interest-bearing debt increased by ¥19,984 million compared to the end of the previous consolidated fiscal year to ¥76,313 million due to the increase in issuance of ¥11,000 million in commercial paper and ¥10,000 million in No. 5 unsecured bonds.

Reference
Forecast of Consolidated Financial Results for FY2006 (April 1, 2006 to March 31, 2007)
The Company has not revised its full-year forecast announced on October 31, 2006.

Supplementary documents

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