DIC Reports 1Q 2010 Results

Bolstered by a continuous, gradual improvement in economic conditions since the April–June 2009 quarter, DIC Corporation reported that overall demand in the three months ended June 30, 2010, rose sharply from the corresponding quarter of the previous fiscal year, although it remained short of pre-recession levels.

In this environment, the DIC Group reported consolidated net sales of 196.8 billion yen ($2.3 billion), an increase of 15.0%, as all segments reported increases in sales both in Japan and overseas. Operating income increased 4.8 times, to ¥10.2 billion, owing to sales volume increases across the board and an improved product mix, among others.

For the Printing Ink & Supplies Group, overall sales of printing inks worldwide rose to ¥102.3 billion ($1.15 billion) in 1Q 2010, up 9.3 percent from ¥93.6 in 2009. In Japan, sales rose considerably by 21.3 percent, bolstered by the assumption of commercial rights for the domestic printing inks business of The Inctec, Inc., effective from the third quarter of the previous fiscal year. Sales of gravure inks were firm as demand for flexible packaging applications for beverage containers and food packaging remained steady.

In contrast, offset inks and news inks struggled, owing to, respectively, falling demand for publishing and advertising leaflets amid declining print runs and page counts for newspapers.

News inks and inks for publishing struggled in North America amid shrinking print runs for newspapers and magazines. Nonetheless, sales in North America and Europe were up for many products and overall by 4.9 percent to ¥66.1 billion ($746 million), led notably by mainstay packaging inks, owing to improved demand overall. In Central and South America, sales rose sharply, reflecting generally robust demand.

Operating income increased substantially, bolstered by the aforementioned sales results and by effective rationalization efforts, among others.

Sales in the People’s Republic of China (PRC) increased across the board, led by offset inks and gravure inks to export markets. In Southeast Asia, sales advanced, supported by firm demand for offset inks, gravure inks
and other products. In Oceania, sales were down as offset inks and news inks struggled, although the depreciation of the yen resulted in an increase in sales in the region. In India, sales rose overall, owing to brisk demand. Operating income rose, reflecting the aforementioned sales results.