Denka elastomers profit rises as DPE suspension lifts earnings

Tokyo – Denka Co.’s elastomers & infrastructure solutions unit, which includes the production of chloroprene rubber, has reported higher operating income in the first quarter of fiscal 2026, started 1 April.

The gains were supported by the suspension of chloroprene rubber production at the group’s US subsidiary Denka Performance Elastomer (DPE), said Denka 7 Aug.

According to Denka, the elastomers business reported operating income of Yen2.7 billion (€14.7 million) in the three months ended 30 June, compared with a loss of Yen1.4 billion a year earlier.

Denka attributed the improvement to the impact of the DPE production suspension, which contributed Yen3 billion to operating income.

Volumes and pricing contributed Yen1 billion and Yen1.5 billion respectively, while costs and other factors had a negative Yen1.3 billion impact.

Within chloroprene rubber, Denka said demand was “level year-on-year,” while shipments from its Omi plant in Japan increased “due to substitution for DPE products.”

Pricing was also favourable, with Denka noting a positive foreign-exchange impact and an improvement in export unit prices.

However, it said “rising raw material and fuel prices” continued to weigh on costs.

For the first half, Denka revised up its forecast for the segment’s operating by Yen1 billion to Yen5.0 billion, while maintaining its full-year outlook.

Denka said it expects the fundamental measures associated with the DPE production suspension to contribute Yen6.2 billion to full-year operating income, including Yen3.2 billion in the second quarter.

DPE has “nearly completed” the removal of raw materials and intermediates from its manufacturing facilities and is currently cleaning the equipment and carrying out post-treatment work, Denka said.

The subsidiary is also continuing to optimise its workforce, with employee numbers falling from 140 at the end of December 2025 to 80 at the end of July.