The Urethane Blog

Tosoh Results

Tokyo, Japan— Tosoh presents its full-year consolidated results for its 2020 fiscal year, from April 1, 2019, to March 31, 2020. The company’s consolidated net sales for the year under review were ¥786.1 billion (US$7.2 billion), down ¥75.4 billion, or 8.7%, from fiscal 2019. The decrease resulted from a decline in product prices due to lower costs for raw materials, such as naphtha; from a worsening of trade conditions overseas; and from a reduction in sales volume as the global economy decelerated.

Operating income for fiscal 2020 was ¥81.7 billion (US$751.6 million), down ¥24.0 billion, or 22.8%. This decline was mainly due to the decline in international trade conditions caused by the decrease in product prices exceeding the benefits of the decrease in prices for naphtha and other raw materials. Ordinary income also dropped, ¥27.0 billion, or 23.9%, to ¥86.0 billion (US$791.2 million). And net profit attributable to owners of the parent company was down ¥22.5 billion, or 28.9%, to ¥55.6 billion (US$511.5 million).

Concerns over an economic slowdown because of trade friction between the United States and China and geopolitical risk in the Middle East persisted throughout the year under review. As Tosoh enters its 2021 fiscal year, economic and social activity in Japan and abroad have ground to a halt due to the spread of the novel coronavirus. The global economy is deteriorating sharply.

Results by business segment

Chlor-alkali Group

The Chlor-alkali Group’s net sales fell ¥40.0 billion, or 11.9%, to ¥297.4 billion (US$2.7 billion).

Domestic shipments of caustic soda decreased amid stagnating demand. And caustic soda product prices declined to reflect worsening market conditions overseas.

Vinyl chloride monomer (VCM) shipments decreased because of a decline in production volume. Conversely, polyvinyl chloride (PVC) resin shipments rose in line with increased production volume. The prices, however, of VCM and of PVC resin fell to reflect cost reductions for raw materials, such as naphtha, and worsening market conditions abroad.

Domestic demand for cement remained sluggish. And this led to a decrease in cement shipments.

Shipments of methylene diphenyl diisocyanate (MDI) declined amid reduced demand domestically and overseas. The price of MDI likewise fell, reflecting diminished market conditions abroad.

The group’s operating income was down ¥17.8 billion, or 38.7%, to ¥28.2 billion (US$259.4 million). The decrease was caused by declining trade conditions as lower product prices surpassed the effects of decreased raw material costs.

Specialty Group

Net sales by the Specialty Group in fiscal 2020 decreased ¥12.4 billion, or 6.3%, to ¥185.0 billion (US$1.7 billion).

The group’s shipments of ethyleneamine products fell. This was the result of stagnation in demand, mainly in Asia.