Nippon Sheet Glass Co. said 24 May 2008 that group pretax profit is likely to fall 41% to JPY 18BN for year end March/09, with higher crude oil prices driving up fuel & transport costs. VP Stuart Chambers, who takes over as president on 27/06/08 suggested that struggling N American automotive glass operations may need to be restructured. Interest payments of JPY 20BN resulting from the acquisition of Pilkington Plc & JPY 23BN in goodwill amortization are expected to result in further deterioration in earnings. The dividend payout will remain JPY 6 a year, however. Operating profit is estimated to plunge 33% to JPY 31BN. An JPY 8BN reduction in costs is unlikely to offset the impact of pricier crude oil. In calculating its earnings, the company is assuming $100/barrel for N Sea Brent crude. Each rise of $1 in crude prices eats into operating profit by JPY 400M. Sales are seen growing 2% to JPY 880 billion, with net profit down 60% at JPY 20 billion in the absence of an extraordinary profit that helped the previous fiscal year's bottom line. The addition of Pilkington helped boost Nippon Sheet Glass' overall sales 27% to JPY 865.5 billion for the year ended 31 March 2008. Pretax profit jumped 280% to JPY 30.4 billion.
