Rubber decline hits Ube group-profits

Tokyo – Ube Industries Ltd’s synthetic rubber business contributed to a steep decline in group profitability for the first three quarters of its current fiscal year, ending 31 March.

While group-wide net sales increased 6.6% year-on-year to Yen540.4 billion (€4,33 billion), Ube’s operating earnings fell 20.1% to Yen30.0 billion.

At Ube's chemicals division, while net sales increased 4.2% year-on-year to Yen234.7 billion, operating profit fell 28.3% to Yen15.9 billion.

Some Yen5.0 billion of the earnings-reduction was linked to a decline in the profitability of Ube’s synthetic rubber business.

This was despite a 0.9% rise in net sales at the business, which specialises in the manufacture of butadiene rubbers.

“Sales volume of the products mainly used for tires increased,,” according to the Japanese group's 4 Feb Q1-Q3 report.

However, Ube added, butadiene rubber "product prices fell, whereas raw material price[s] rose," during the nine-month period.