Asahi Posts Bleak First Half 2009 Results, Full-Year Forecast
May 11, 2009

Asahi Glass Co. (AGC) in Japan has released its financial report for the first quarter of fiscal 2009, or January 1 through March 31, 2009. The company notes that due to the global economic environment, AGC and its consolidated subsidiaries were sluggish across all regions. Under such a business environment, the AGC Group posted net sales of $2.4 billion USD (236.3 billion yen), down $1.4 USD from the first quarter or 2008; operating loss of $61.6 million USD, down $616.2 million USD from the first quarter 2008; ordinary loss of $108.8 million USD, down $494.8 million USD from the first quarter 2008; and net loss of $143.7 million USD, down $432.2 million USD from the first quarter 2008. CLICK HERE for AGC's full consolidated financial results for the first quarter of fiscal year 2009.

Sales in the flat glass business decreased from the corresponding period of the previous year. In Western Europe, demand continued to weaken as the economy slowed down, and prices also dropped from a year earlier. Affected by the slowing economy, fast-growing markets such as Russia also saw a decrease in demand accompanied by a significant decline in prices. In North America, to cope with weakened demand, the AGC Group decided to stop operations of some more flat glass production facilities (CLICK HERE for more). In Japan, shipments decreased, affected by continued weak demand from the construction sector. Shipments of glass for solar cells remained at slight increase due to a slowdown in the growth of the solar cell market. Prices of raw materials and fuels declined, but the effects were limited because of the weak demand.

As a result, net sales from the glass operations for the first quarter were $1.1 billion USD, down 41.5 percent compared to the first quarter of 2008, and operating loss were $162.2 million USD, or $247.4 million USD worse than the operating income reported the corresponding period of the previous year.

As the outlook for the global economy in 2009 remains uncertain, and the economic growth of emerging countries that have led AGC's worldwide growth is expected to slow down, the company expects shipments of flat and automotive glass to remain flat in 2009 throughout all regions. Moreover, the company expects the growth rate of glass for solar cells to slow as a result of the worsening economic climate. Based on the outlook for these and other business conditions, without changing any of its initial plans related to FY 2009 forecast, AGC expects its income for the half to be significantly down. CLICK HERE to read AGC's outlook for the first half of fiscal year 2009 or see chart below.

In addition to these financial postings, AGC today announced an organizational reform for a part of in-house companies and management sections. As of July 21, AGC will merge its current Flat Glass Company, which produces and sells glass for construction, industrial and solar cells, and the current Automotive Glass Company, which produces and sells glass for automotive use, to create a single all-encompassing Glass Company. The company will be headquartered in Brussels with regional headquarters in Japan, Belgium and the U.S. CLICK HERE to read about AGC's organizational reform. CLICK HERE to read changes in the assignments of AGC's executive officers following the organizational changes.

Outlook for Consolidated Operating Results for the First Half of Fiscal Year 2009, January 1 through June 30, 2009

(Unit: million USD)

Need more info and analysis about the issues?
CLICK HERE to subscribe to USGlass magazine.