-- Shinagawa Refractories (TYO:5351) has lowered its net income forecast for the fiscal year ending March 31 to 26 billion yen from the previous forecast of 31 billion yen, according to a Tokyo bourse filing on Thursday.
The company, which produces refractories primarily for steel makers, now expects net income per share to be 569.76 yen from 679.33 yen initially.
Net sales, operating income, and ordinary income estimates remain unchanged from the prior forecast at 176 billion yen, 13 billion yen, and 14.9 billion yen, respectively.
The downward revision is primarily due to the recording of impairment losses, including 4.3 billion yen at the Ako Plant following a significant deterioration in domestic crude steel production and refractory demand.
A further 3.9 billion yen on goodwill and fixed assets at Brazilian subsidiary SRB was recorded following low-priced Chinese steel imports pressuring local steelmakers, and another 1.5 billion yen on goodwill at engineering subsidiary Reframax.
Despite these charges, the company noted that the Ako Plant continues to generate positive operating cash flow and will remain in operation while efficiency efforts are pursued.
The company's annual dividend forecast of 90 yen per share remains intact.