Fibers and Textiles segment sales drop at Toray

16 Aug '12

4 min read

Toray Industries Inc announced its consolidated business results for the three months ended June 30, 2012, the first quarter of the year ending March 31, 2013. The following summary of the business results that the Company submitted to the Tokyo Stock Exchange is unaudited and for reference only.

In the period under review, while the U.S. economy continued to recover, albeit at a slow pace, the European sovereign debt problems affected the region’s real economy. At the same time, growth in exports and investment slowed in emerging countries. On the other hand, the Japanese economy continued to recover at a gradual pace on the back of demand related to reconstruction from the Great East Japan Earthquake and the effect of stimulus measures for automobile consumption. Demand for apparels, flat-screen TV sets and IT-related products, which was relatively strong both in Japan and overseas in the first half of 2011, has been affected by the worldwide economic slowdown since last fall. While currently in a recovery phase, the demand has not recovered to the level of the same period a year earlier.

Under such circumstances, Toray Group has been implementing the growth strategy with focus on pursuing business expansion in growth business fields and growth regions and further bolstering its total cost competitiveness in accordance with the medium-term management program “Project AP-G 2013” launched in April 2011.

As a result, consolidated net sales for the three months ended June 30, 2012 declined 2.9% compared with the same period of the previous fiscal year to ¥364.1 billion (US$4,591 million). Operating income fell 36.7% to ¥17.3 billion (US$218 million) and ordinary income decreased 34.3% to ¥19.1 billion (US$241 million). Net income declined 43.3% to ¥10.1 billion (US$127 million).

In Japan, sales of industrial-use materials in general grew strongly fueled by factors including rising sales for automotive applications reflecting production expansion by automobile manufacturers. Demand for apparel applications, however, remained weak due to the unseasonal weather in early spring as well as other factors.

Overseas, in addition to sluggish demand in Asia given the impact of the economic slowdown in the U.S. and Europe, both production and sales continued to be affected by the floods in Thailand following the fourth quarter of the previous fiscal year. As a result, overall sales of Fibers and Textiles fell 4.6% to ¥135.8 billion (US$1,712 million) from the previous year and operating income declined 13.9% to ¥8.7 billion (US$110 million).

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