Nippon Sheet Glass Co. is expected to report a 68% rise in group operating profit to about JPY 6.5 billion for the six months ended 30 September as its domestic weakness was more than offset by the st…
Nippon Sheet Glass Co. is expected to report a 68% rise in group operating profit to about JPY 6.5 billion for the six months ended 30 September as its domestic weakness was more than offset by the strong results at Pilkington Plc, the UK firm that it acquired earlier in 2006. Nippon Sheet“s interim sales are estimated to have roughly doubled to around JPY 265 billion. Sales at Pilkington apparently grew about 8%, thanks to the construction boom in such markets as Germany and Eastern Europe. With Pilkington“s solid performance, Nippon Sheet is likely to meet its full-year earnings targets. Group operating profit is seen jumping 320% to JPY 35 billion, as the anticipated growth of the European operations offset the expected decline in profit in the domestic segment, which is being hurt by higher raw materials and fuel costs. Nippon Sheet“s financial position, which was adversely affected by the Pilkington purchase, will likely improve sooner than expected. The balance of its interest-bearing debt has increased by some JPY 430 billion since the end of March 2006. However, the new UK unit is generating a higher free cash flow than anticipated, allowing the Japanese parent to repay debt more quickly.