Asahi Glass Co. Ltd. (AGC) recently announced its third quarter fiscal results, including net sales of ¥994.2 billion (~ $8.5 billion). During the nine months ended September 30, 2014, the global economic environment surrounding the company and its consolidated subsidiaries remained on a gradual recovery track. Specifically, while economic growth decelerated in China and other emerging markets, the business conditions in Europe picked up and consumer spending in the U.S. maintained its stability. In Japan, the economy made a gradual recovery as business confidence was restored due to economic measures taken by the government and other factors.
Under such a business environment, the AGC Group posted net sales of ¥994.2 billion (~ $8.5 billion), up ¥22.3 billion (~ $189 million), or a 2.3% increase, from the corresponding period of the previous year, thanks to increased shipments of glass products, centering on automotive glass, and chemicals, as well as the continued depreciation of the yen. However, the group was also affected by sales price declines in the LCD glass substrate business and the architectural glass business in Eastern Europe, price increases of fuels and raw materials, and reduced profitability of foreign subsidiaries due to the weak yen. As a result, operating profit decreased ¥17.3 billion (~ $147 million), or 28.9%, year-on-year to ¥42.5 billion (~ $362 million), and profit before tax decreased by ¥10.8 billion (~ $92 million) or 28.8% to ¥26.7 billion (~ $227 million). Profit for the period attributable to owners of the parent was ¥8.4 billion (~ $71 million), a ¥11.2 billion (~$ 95 million) or 57.1% decrease on a year-on-year basis.
In the flat glass business, shipments of architectural glass increased from the corresponding period of the previous year in all regions. Sales prices were stable thanks to the price improvement in the European region since the second quarter, while, in Eastern Europe, price levels remained below the levels of the same period of the previous year. Sales of architectural glass increased on a year-on-year basis, partly due to the weak yen. In the automotive glass business, the AGC Group’s shipments increased, as auto production as a whole remained robust despite decreases in auto production in some regions. Sales increased on a year-on-year basis, partly reflecting the weak yen and the increased shipments.
As a result, net sales from the Glass Operations for the nine months ended September 30, 2014, were ¥529.0 billion (~ $4.5 billion), up ¥39.9 billion (~ $340 million), or an 8.1% increase from the same period of the previous fiscal year. Operating profit/loss improved by ¥9.1 billion (~ $77 million) year-on-year to post a loss of ¥700 million (~ $6 million), mainly due to the effects of structural reforms in the European architectural glass business in addition to increased sales of architectural and automotive glass.