In the rest of Asia, China saw its economy grow at a high rate and ASEAN countries’ economy continued to be firm. In the NIEs (Newly Industrial Economies), demand in the IT and digital sectors recovered, where a slowdown had been observed at one stage.
The economies of Russia and Central and Eastern Europe remained steady. The economy of Western Europe in general remained strong, although some countries were faced with a slowdown in exports and capital investment, which had led the economic growth in the region. In the U.S., the subprime loan problem weighed down the housing market and the growth of capital expenditure, and concern mounted about a slowdown in the economy.
As for the target market of the AGC Group, backed by a rising demand for thin-screen TVs, the market of glass substrates for flat panel displays (FPDs), such as glass substrates for thin film transistor liquid crystal displays (TFT LCDs), remained relatively steady,. In the Glass operations, the flat glass market was sluggish in Japan and North America but continued to be firm in Europe. The Chemicals operations saw the market pick up.
Under such circumstances, the Group posted net sales of 1,234.0 billion yen for the period under review, up 33.0 billion yen or 2.7% from the previous year’s corresponding period, operating income of 142.1 billion yen, up 41.3 billion yen or 40.9%, and ordinary income of 137.5 billion yen, up 39.1 billion yen or 39.7%. Net income increased 18.8 billion yen or 29.2% year on year to 83.4 billion yen.
Overview of the third quarter of 2007 by business segment
The Glass operations comprise flat glass business for construction and automotive glass, which are both conducted globally, as well as other glass business involving fiberglass and other glass applications, which are operated mainly in Japan.
Sales in the flat glass business increased from the corresponding period of the previous year. Glass shipments were strong in fast-growing markets, such as Russia. Demand also remained firm in Western Europe. In Japan and North America, however, glass shipments were adversely affected by a decrease in new housing starts.
In the automotive glass business, sales increased from the corresponding period of the previous year as customers’ auto production was steady, although the worldwide auto output remained almost flat from a year earlier.
In other glass business, sales decreased from the corresponding period of the previous year due to the withdrawal, by Asahi Fiber Glass Co., Ltd., from the composite business in March 2006. The Company has decided to sell all shares of Asahi Fiber Glass on November 1, 2007.
As a result, net sales from the Glass operations for the period under review were 643.0 billion yen, up 40.9 billion yen or 6.8% from the corresponding period of the previous year, and operating income increased 19.6 billion yen or 62.3% to 51.0 billion yen.
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