Cost cuts help Japan producers improve earnings

Cost cuts help Japan producers improve earnings
Published: 29 November 2010

Taiheiyo Cement Corp and Sumitomo Osaka Cement Co are enjoying improved earnings in their domestic cement segments this fiscal year, thanks to streamlining efforts.

Taiheiyo Cement’s operating profit in this segment is expected to jump 190% on the year to JPY7.6bn for the term ending March 2011, while Sumitomo Osaka Cement’s figure is seen at JPY3.4bn, up 24%.

Taiheiyo Cement estimates its cost reductions at JPY10.6bn this fiscal year. It halted production at three plants in the first half, lifting the domestic cement segment to its first interim operating profit in three years. The effects of an early retirement program for which 427 workers signed up are expected to manifest in the second half.

Sumitomo Osaka Cement slashed output capacity 20%, making facilities more fuel-efficient. Streamlining efforts are seen lowering costs by JPY1.2bn this fiscal year.