Sumitomo Seika Chemicals to book loss on overcharged prices

Sumitomo Seika Chemicals (TSE:4008) announced that one of its subsidiaries incorrectly charged a customer for a product after changing the raw material supplier without notification. This resulted in overpayments of JPY1,355 million, which the company intends to repay. Consequently, Sumitomo Seika Chemicals will book a corresponding extraordinary loss within its consolidated financials for the current fiscal year. In addition, the company will book impairment losses of JPY1,297 million on some of its functional materials products due to market conditions affecting future recoverability. As a result, the company revised its full-year consolidated financial forecasts. Revenue is now expected at JPY147,500 million, operating profit at JPY10,700 million, and profit attributable to owners of the parent at JPY6,000 million, down from previous expectations. In response to the incident, Sumitomo Seika Chemicals will reduce compensation for its executives, with reductions ranging from 30% to 50% of monthly remuneration for two months. The year-end dividend forecast remains unchanged at JPY100 per share.