Risk of demand fluctuations in steel, electronics and other industries

「The Gas Products Unit saw a decline in gas supply volumes at its steelmaking on-site operations, due in part to the shutdown of some blast furnaces.」

「In the steelmaking on-site business, the Gas Products Unit's gas supply volume declined due to the shutdown of some blast furnaces and other factors.」

「As domestic demand for industrial gases, including in such materials sectors as steel and chemicals, entered a declining trend,」

「Although performance during the period was affected by stagnant semiconductor market conditions in some businesses, price revisions for various industrial gases implemented to date and initiatives in the overseas industrial gas business and the agri-business progressed smoothly, resulting in higher profit in all segments.」

「At the same time, conditions remained uncertain due to the global decline in semiconductor demand and increasing downside risks to overseas economies.」

「In the industrial gas business, gas sales volumes were slightly below the previous year because production activity in industries such as steel and automobiles remained sluggish.」

「The industrial gases business was affected by delays in the recovery of automobile production against the backdrop of semiconductor shortages and declining demand for steel products, with gas sales volumes slightly below the level of the same period of the previous year.」

「The Industrial Gas business remained solid, with gas sales volumes generally at the same level as in the corresponding period of the previous year, as production activity continued to be firm across a broad range of manufacturing industries excluding automotive, including electronic components, chemicals, machinery and shipbuilding.」

「Lorry and cylinder gas supply was affected by production cuts in the automotive-related sector, but sales to the electronic components, chemicals and machinery industries and other customers remained firm, resulting in sales volumes roughly in line with the previous year.」

「Overall business performance remained strong and exceeded pre-COVID levels. Gas supply to the electronics industry, sales of specialty chemicals and equipment, and the industrial gas business in India remained at high levels, while production activity in Japan’s manufacturing sector generally continued to recover.」

「Overall business performance exceeded pre-COVID-19 levels in both sales and profit, as gas supply to the electronics industry, sales of specialty chemicals and equipment, and the industrial gas business in India remained at high levels, while demand for industrial gas was generally firm due to a recovery in domestic manufacturing activity, particularly among export-related industries.」

「Domestic on-site gas supply to the steel industry remained difficult, as sales volumes declined due to the idling and shutdown of blast furnaces at major customers. Gas supplied by tankers and cylinders saw demand plunge as domestic manufacturers adjusted production in early spring. From the second quarter onward, however, gas demand began to recover in line with the recovery of the automotive industry, reaching almost the previous year's level in the second half of the fiscal year.」

「Demand for gas supplied by tanker and cylinder fell sharply in response to production adjustments in Japan's manufacturing sector in early spring. From the second quarter onward, gas demand began to recover in line with the recovery of the automotive industry, reaching almost the same level as in the same quarter of the previous year by the third quarter.」

「In the gas business, domestic on-site gas supply to the steel industry remained in a difficult situation, with sales volumes declining due to the impact of blast furnace shutdowns at major customers. Gas supply by lorry and cylinder saw demand plunge as domestic manufacturers adjusted production in early spring, but from the second quarter onward signs of recovery emerged as the automotive industry rebounded, and sales volumes followed a gradual recovery trend.」

「In the gas business, on-site gas supply to the steel industry was affected by the shutdown of blast furnaces at a major customer, resulting in lower sales volume, and difficult conditions continued.」

「Although some demand stagnation emerged in parts of the industrial gas business in the third quarter, initiatives to strengthen the earnings structure, including product price revisions, steadily improved profitability.」

「During the cumulative second-quarter consolidated period, Japan's economy remained on a gradual recovery path, supported by improvements in the employment environment and a pickup in personal consumption. However, exports stagnated amid prolonged US-China trade friction and an economic slowdown in China, with the effects also extending to production and capital investment in Japan's manufacturing sector, and uncertainty about the outlook continued to increase.」

「Although liquid gas supply by tanker and cylinder was affected in some regions and industries by stagnant production activity, sales overall remained solid.」

「On-site gas supply for blast furnaces progressed steadily, supported by solid crude steel production and continued stable operations. On-site gas supply for electronics also progressed steadily as customer plants continued to operate at high levels. In addition, liquid gas and cylinder supply was generally steady against solid demand from domestic manufacturing industries, including the automotive, chemical and construction sectors.」

「Japan's economy remained on a moderate recovery trend, supported by a recovery in personal consumption due to improvements in employment and income conditions and improved corporate earnings. However, the outlook remained uncertain due to the effects of successive natural disasters, rising crude oil prices and concerns over escalating trade friction overseas.」

「Although concerns remained over responses to US trade policy and heightened geopolitical risks in certain countries and regions, the US and European economies remained solid, while a moderate economic recovery continued in China and emerging Asian economies.」

「Although corporate earnings improved, investment in new production facilities remained cautious, and personal consumption had yet to recover, resulting in a broader domestic economic recovery that lacked strength.」

「The operating environment surrounding the Group improved steadily, as production activity in export-oriented manufacturing recovered on the back of the solid US economy and recovering demand from Asia. However, capital investment by manufacturers remained cautious and lacked momentum, partly due to the impact of sharp exchange-rate fluctuations resulting from changes in overseas conditions.」

「In industrial gases, some industries showed a solid recovery, including the automotive industry, where operating rates were raised to recover from the Kumamoto Earthquake, and electronic components, supported by strong smartphone-related demand in China. However, the outlook remained difficult for a full-scale recovery in production activity across Japan's manufacturing sector, including shipbuilding, where there were still no signs of a recovery in order volumes, construction machinery, which continued to be affected by the stronger yen and lower resource prices, and construction, which continued to struggle with labor shortages.」

「In industrial gases, signs of stagnation began to emerge in the electronics sector, which had previously been the main growth driver, while the automobile industry, where a strong recovery had been expected, was also affected by the Kumamoto earthquake. Although operating rates varied among customers, production activity remained weak and unstable.」

「The industrial gases manufactured and sold by the Group, including oxygen and nitrogen, have steel, electronics, automotive and shipbuilding companies as major customers. Accordingly, trends in demand in these industries may affect industrial gas sales.」