Tokyo – Zeon Corp.’s elastomers unit has seen signs of market recovery, particularly in sales volume for rubbers, as demand in the tire market starts to rebound.
The business unit – comprised of ‘rubbers’, latex and chemicals units – saw rubber volumes recover quarter-on-quarter to 82 kilotonnes during the second quarter, ended 30 Sept, up from 65 kilotonnes in the previous three months.
Year-on-year, rubber volumes lagged 9%, Zeon announced 30 Oct.
The Japanese materials supplier linked the increase in volume to a recovery in demand for general-purpose rubber, mainly used for tires. Speciality rubber, used for car and industry applications, was slow to recover, Zeon added.
Net sales for the rubber segment, however, continued to decline, posting a 32% fall year-on-year to Yen21.8 billion (€178.6 million), down 8% compared to the prior quarter.
Sales of latexes remained steady for the medical/sanitary gloves, but demand was “still weak” in general industry. Sales volumes for the segment remained flat at 31 kilotonnes during the quarter, while net revenue fell 24% year-on-year to Yen3.2 billion.
Rubber chemicals volumes rose 8% year-on-year to 33 kilotonnes, helping push sales up 1% to Yen7.9 billion.
Overall, the elastomers unit posted sales of Yen34.2 billion, down 24% compared to the same quarter a year ago.
Zeon said revenue was impacted by lower volumes outside Japan, due to the Covid-19 effects, exchange rate translation and lower prices.
The unit’s operating income went into black, at Yen900 million, after reporting a loss of Yen100 million in the first quarter. Year-on-year the figure was down 64%.
Zeon linked the improvement in operating income to a 43% positive impact from lower raw material prices and a 10% improvement in SG&A.