DIC Reports Consolidated Financial Results for 2022

DIC Corporation reported its consolidated financial results for the year ended Dec. 31, 2022. For the full year, consolidated net sales climbed 23.2%, to ¥1,054.2 billion ($7.97 billion). Operating income was ¥39,682 million ($300 million), down 7.5% from 2021.

DIC reports that in the fiscal year ended December 31, 2022, consolidated net sales climbed 23.2%, to ¥1,054.2 billion.

“This sharp increase, coming amid global economic turmoil caused by a multiplicity of escalating geopolitical risks, including rising inflationary pressure worldwide, the protracted crisis in Ukraine and restrictions on movement in the People’s Republic of China (PRC) under a stringent ‘zero-COVID’ policy, was attributable to ongoing efforts to adjust sales prices in response to elevated energy, logistics and raw materials costs, as well as to the influence of yen depreciation on results denominated in other currencies after translation,” DIC reported.

“In the Color & Display segment, the margin of improvement in net sales was boosted by the addition of a full year of sales from the C&E pigments business, which was not included in the scope of consolidation until the second half of the previous fiscal year,” DIC added. “Nonetheless, shipments of high-value-added products were down in all regions from the third quarter forward, that is, from July through December, as demand for digital materials, used principally in electrical and electronics equipment and displays, continued to deteriorate in a negative rebound from gains ascribed to COVID-19–induced stay-at-home lifestyles, as well as to the fact that automobile production–related markets, plagued by semiconductor shortages, remained in recovery mode. Shipments of pigments also fell from the third quarter forward, owing to waning economic conditions in Europe, a leading market for these products.

“Operating income decreased 7.5%, to ¥39.7 billion,” DIC noted. “This was despite the progress of efforts to pass on higher costs, particularly for raw materials, by modifying sales prices for many products, and was due largely to falling shipments of high-value-added products, notably digital materials and materials used in mobility solutions, which pushed down results in the Color & Display and Functional Products segments. The absence of ¥4 billion in one-time expenses recorded in the previous fiscal year in association with the integration of the C&E pigments business narrowed the margin of decline.”

Packaging & Graphic segment sales rose 21.2%, to ¥533 billion ($4.02 billion). “Sales of packaging inks, used primarily on packaging for food products, increased, supported by efforts in all regions to modify sales prices. Nonetheless, shipments in Asia were down, as those in the PRC remained listless, hampered by that country’s relentless zero-COVID measures,” DIC noted. “Segment operating income fell 6.0%, to ¥20.3 billion, despite edging up 0.3% on a local currency basis.”

Meanwhile, Color & Display sales rose 48.5% to ¥248.2 billion ($1.88 billion). “Owing to the addition of sales from the C&E pigments business, sales of pigments for coatings, plastics and cosmetics increased significantly,” said DIC. “Segment operating income, at ¥5.1 billion, was up 29.1%.”