February 8, 2023

Consolidated Financial Report for the Nine Months Ended December 31, 2022
TOYOBO Co., Ltd.

URL

https://ir.toyobo.co.jp/en/ir.html

Stock Code: 3101 (Prime Market, Tokyo Stock Exchange)
Representative: Ikuo Takeuchi, President & Representative Director
Contact Person: Sonoko Ishimaru, General Manager, Corporate Communication Department

TEL: +81-6-6348-3044

Quarterly report filling date (Planned): February 14, 2023
(Figures are rounded to the nearest million yen)

1. Consolidated Business Performance(1) Consolidated Operating Results
Nine months ended December 31

Percentages indicate year-on-year increase/ (decrease)

Net sales

Operating profit

Millions of yen%

Millions of yen

Profit attributable toowners of parent

Ordinary profit%

Millions of yen%

Millions of yen

%

2022

298,738

8.8

9,568

(58.2)

6,943(61.8)

9,759(19.5)

2021

274,541

12.6

22,89325.1

18,19846.0

12,125-(Note) Comprehensive Income:Nine months ended December 31, 2022: ¥10,158 million (41.4%)
Nine months ended December 31, 2021: ¥17,326 million -%Net profit per
share

Net profit per shareafter dilution

Yen

Yen

2022

109.72-2021

136.44-(2) Consolidated Financial Position
Total assets

Net assets

Equity ratio

Net assets per share

Millions of yen

Millions of yen%

Yen

December 31,
529,881203,64238.0
2,263.83
2022
March 31,517,774
197,14937.6
2,192.17
2022(Reference) Total shareholders’ equity: December 31, 2022: ¥201,436 million, March 31, 2022: ¥194,876 million

2. Dividends
Dividends per share
Record date

1st Quarter

2nd Quarter

3rd Quarter

Year-end

Total

Yen

Yen

Yen

Yen

Yen

FY 3/2022

－

0.00

－

FY 3/2023

－

0.00

－

FY 3/2023(Forecast)(Note) Revision of dividends forecast for this period: None

1

40.00

40.00

40.00

40.00

3. Forecasts for Fiscal Year Ending March 31, 2023
Percentages indicate year-on-year increase/ (decrease)

Net sales
Millions of yen

Fiscal year

Operating profit%

400,000

Millions of yen

6.5

Fiscal year

6,500

%

11,000

Profit attributable toowners of parent
Millions of yen

Ordinary profit
Millions of yen(61.3)%

7,500(67.5)Net profit per share%

Yen(49.5)

73.08(Note) Revision of earnings forecast for this period: Yes

4. Other
1. Significant changes in subsidiaries during the subject fiscal year (Transfer of particular subsidiaries
following a change in the scope of consolidation): None
1) New company: None2) Excluded company : None
2. Adoption of simplified and special accounting methods: None
3. Changes from accounting methods, procedures and the presentation of the consolidated financial
statements:
1) Changes based on revision of accounting standards: None2) Changes other than 1) above: None3) Changes due to accounting estimation change: None4) Error correction: None4. Number of shares issued and outstanding (common stock):1) Number of shares outstanding (including treasury stock):
December 31, 2022: 89,048,792 shares

March 31, 2022: 89,048,792 shares

2) Number of treasury stock:
December 31, 2022: 68,549 shares

March 31, 2022: 152,550 shares

3) Average number of shares outstanding for each period (cumulative term):
Nine months ended December 31, 2022: 88,946,400 shares
2021: 88,871,077 shares※ Quarterly Financial Results reports are exempt from Quarterly review※ Explanation regarding the appropriate use of forecasts of business results
The forward-looking statements made in this document, including the aforementioned forecasts, arebased on all information available to the management at the time of this document's release. Actual
results may differ from the results anticipated in the statements.
(How to obtain supplementary document on earnings)
The supplementary document on earnings is disclosed on the same day as the Quarterly Financial
Results report, and it is made available on the Company’s website.

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1. Qualitative Information and Financial Statements(1) Qualitative Information on Consolidated Results
The business environment surrounding the Toyobo Group (hereinafter the “Group”) in the ninemonths ended December 31, 2022 was characterized by a slowdown in the global economy due tomonetary tightening policies in Europe and the United States to curb the acceleration of inflation,
the impact of rising raw material and fuel prices accompanying the prolongation of the situation in
Ukraine, and China’s zero-COVID policy (lockdowns). On the other hand, in Japan, the sense of
economic stagnation has intensified due to inflation caused by rising raw material and fuel prices
and yen depreciation caused by monetary easing measures, in addition to delays in the recovery of
automobile production as a result of shortages in the supply of materials such as semiconductors.
Going forward, Japan’s economy is expected to make a moderate recovery against the backdrop of
the living-with-COVID policy and increased inbound demand. However, constraining factors suchas the global economic slowdown and high fuel prices continue to make the situation uncertain.
Under this business environment, sales of volatile organic compound (VOC) treatment equipment
for recovering solvents have proceeded robustly owing to increased demand for lithium-ion
batteries. Moreover, sales of raw materials and reagents for PCR testing grew in response to thedemand for PCR testing due to the resurgence of COVID-19 infections. On the other hand, sales ofpolarizer protective films for LCDs “COSMOSHINE SRF” and mold releasing film for multilayer
ceramic capacitors (MLCC) fell due to a temporary deterioration in the market. In addition, the films
business and nonwoven materials business faced challenges due to the significant impact of rising
raw material and fuel prices, despite efforts to implement product price revisions.
As a result, consolidated net sales in the nine months ended December 31, 2022 increased ¥24.2
billion (8.8%) over the same period of the previous fiscal year, to ¥298.7 billion. Operating profit
decreased ¥13.3 billion (58.2%), to ¥9.6 billion and ordinary profit decreased ¥11.3 billion (61.8%)
to ¥6.9 billion. Profit attributable to owners of parent decreased ¥2.4 billion (19.5%) to ¥9.8 billion
despite recording extraordinary income in the first three months of the fiscal year of ¥5.6 billion
from insurance claim income for a fire accident.
Results by business segment were as follows:
Films and Functional Materials
In this segment, efforts were made to implement product price revisions, and sales increased,
although operating profit decreased due to the significant impacts from rising raw material and fuelprices and a deterioration of market conditions for the industrial film business.
In the films business, the packaging film business experienced difficulties in realizing product pricerevisions to compensate for rising raw material and fuel prices.
In the industrial film business, sales fell due to a temporary deterioration in the market for polarizer
protective films for LCDs “COSMOSHINE SRF” and mold releasing film for MLCC.
In the functional materials business, sales of industrial adhesives “Vylon” declined due to theimpact of China’s zero-COVID policy.
As a result, sales in this segment increased ¥1.0 billion (0.8%) from the same period of theprevious fiscal year to ¥128.3 billion, and operating profit decreased ¥12.1 billion (72.8%) to ¥4.5
3

billion.
MobilityIn this segment, efforts were made to implement product price revisions, and sales increased,
although the operating loss increased due to the significant impact of rising raw material and fuelprices.
As for sales of engineering plastics in Japan, product price revisions were unable to keep up withrising raw material and fuel prices. Overseas, product price revisions were implemented and there
was the effect of yen depreciation, but business was affected by rising raw material prices andlogistics costs and China’s zero-COVID policy.
Sales of airbag fabrics increased due to a year-on-year recovery in automobile production, but the
spread did not improve due to higher purchase prices for yarn and other raw materials.
As a result, sales in this segment increased ¥5.1 billion (15.7%) from the same period of theprevious fiscal year to ¥37.2 billion, with an operating loss of ¥2.9 billion. (Compared with operating
loss of ¥1.4 billion for the same period of the previous fiscal year.)Lifestyle and Environment
In this segment, sales of the environmental solutions business were strong. The nonwoven
materials business was made to implement product price revisions and sales increased, although
the operating profit decreased due to the significant impact of rising raw material and fuel prices.
In the environmental solutions business, sales of replacement elements as well as VOC treatment
equipment used in the manufacturing process for lithium-ion battery separators were strong due tothe increase in demand for lithium-ion batteries as a result of the global shift to EV.
In the nonwoven materials business, the business faced challenges as product price revisions wereunable to keep up with the rising raw material and fuel prices.
In the high performance fibers business, sales remained strong, centered on “ZYLON” forapplications in building structural reinforcement and bicycle tires and “IZANAS” for use in fishingline.
As a result, sales in this segment increased ¥12.1 billion (14.7%) from the same period of theprevious fiscal year to ¥94.5 billion, and operating profit decreased ¥1.1 billion (40.5%) to ¥1.6
billion.
Life Science
In this segment, sales and operating profit increased despite increased costs for supporting good
manufacturing practice (GMP) (including manufacturing and quality control standards forpharmaceuticals, etc.) in the contract manufacturing business of pharmaceuticals as demand forreagents for PCR testing strengthened due to the resurgence of COVID-19 infections.
In the biotechnology business, sales of reagents for PCR testing increased sharply in response to
the demand for PCR testing due to the resurgence of infections in the seventh and eighth waves of
COVID-19. Sales of enzymes for diagnostic reagents as well as those for genetic testing reagentswere strong due to an increase in sales for Europe and the United States in addition to the impact
4

of foreign exchange.
In the medical materials business, sales of artificial kidney hollow fiber trended strong, but wereaffected by rising raw material and fuel prices.
As a result, sales in this segment increased ¥4.7 billion (19.3%) from the same period of theprevious fiscal year to ¥29.3 billion, and operating profit increased ¥1.6 billion (24.6%) to ¥8.0
billion.
Real Estate and Other BusinessThis segment includes infrastructure-related businesses such as real estate, engineering,
information processing services, and logistics services. Results in these businesses were generally
in line with plans.
As a result, sales in this segment increased ¥1.3 billion (15.6%) from the same period of theprevious fiscal year to ¥9.4 billion, and operating profit increased ¥0.1 billion (3.6%) to ¥1.7 billion.
(2) Qualitative Information on the Consolidated Financial Position
Assets, Liabilities and Net Assets
Total assets increased ¥12.1 billion (2.3%) from the end of the previous fiscal year, to ¥529.9 billion.
This was mainly due to an increase in inventories and an increase in property, plant and equipment
due to capital investment.
Total liabilities increased ¥5.6 billion (1.8%) to ¥326.2 billion. This was mainly due to an increase innotes and accounts payable – trade and borrowings.
Net assets increased ¥6.5 billion (3.3%) from the end of the previous fiscal year, to ¥203.6 billion
mainly due to an increase in retained earnings and foreign currency translation adjustment.
(3) Qualitative Information on Consolidated Forecasts
In light of recent developments, we have revised our consolidated earnings forecasts for the fiscal
year ending March 31, 2023, which were announced on November 10, 2022. For details, pleaserefer to the “Notice of Revision of Consolidated Earnings Forecasts” released today (February 8,2023).

5

2. Consolidated Financial Statements(1) Consolidated Balance Sheets(Millions of yen)Previous Fiscal Year(As of March 31, 2022)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Contract assets
Electronically recorded monetary claims operating
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
Land
Other, net
Total property, plant and equipment
Intangible assets
Investments and other assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

6

Current Third Quarter(As of December 31, 2022)

27,17691,082421

15,71778,658323

10,747

12,62957,362
14,48324,204
14,150(311)
239,314

71,19818,13631,141
14,089(273)
241,618

53,96051,786
91,58630,242
227,574
4,307

56,53552,03790,781
40,685240,037
4,198

47,551(972)
46,579278,460
517,774

45,116(1,087)44,028288,263
529,881(Millions of yen)Previous Fiscal Year(As of March 31, 2022)
Liabilities
Current liabilities
Notes and accounts payable - trade
Electronically recorded obligations - operating
Short-term borrowings
Current portion of bonds payable
Current portion of long-term borrowings
Provisions
Other
Total current liabilities
Non-current liabilities
Bonds payable
Long-term borrowings
Provision for retirement benefits for directors(and other officers)
Provision for environmental measures
Retirement benefit liability
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive
incomeNon-controlling interests
Total net assets
Total liabilities and net assets

7

Current Third Quarter(As of December 31, 2022)

46,876
6,326
40,592－
21,418
4,823
26,714
146,750

48,921
5,590
44,48810,00013,0592,863
27,245
152,166

55,00070,68145,00081,285

236

232

12
19,841
28,106
173,876
320,626

12
19,31728,226
174,072
326,239

51,73032,19374,700(221)
158,40251,73032,09880,903(98)
164,633

4,882

2,960

7
41,562(7,656)(2,321)

941,562(5,412)(2,317)36,47436,803

2,273
197,149
517,774

2,207
203,642
529,881(2) Consolidated Statements of Income andConsolidated Statements of Comprehensive Income(Millions of yen)(Consolidated Statements of Income)Previous Third Quarter(From April 1, 2021
To December 31, 2021)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Dividend income
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses
Loss on suspension of production
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sale of non-current assets
Gain on sale of investment securities
Insurance claim income
Total extraordinary income
Extraordinary losses
Loss on disposal of non-current assets
Loss on sale of investment securities
Other
Total extraordinary losses
Profit before income taxes
Income taxes
ProfitLoss attributable to non-controlling interests
Profit attributable to owners of parent

8

Current Third Quarter(From April 1, 2022
To December 31, 2022)

274,541
202,540
72,00049,10722,893298,738
233,449
65,28955,721
9,568

463
39
751
1,253

256
390
1,178
1,824

922
782
4,244
5,948
18,198

1,003
－
3,446
4,449
6,943

－
232
－
232

1,198
2,796
5,607
9,601

2,473
848
77
3,399
15,031
2,957
12,074(51)
12,125

2,309
－
－
2,309
14,235
4,540
9,695
(64)
9,759

(Millions of yen)(Consolidated Statements ofComprehensive Income)Previous Third Quarter(From April 1, 2021
To December 31, 2021)

ProfitOther comprehensive income
Valuationdifferenceonavailable-for-salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net oftax
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners ofparentComprehensive
incomeattributabletonon-controlling interests

9

Current Third Quarter(From April 1, 2022
To December 31, 2022)

12,074

9,695

4,144

(1,923)

6
984

2
1,637

(57)

4

176

743

5,252
17,326463
10,15817,33810,088(11)70

(3) Note to Consolidated Financial Statement(Note to Going Concern)
Not applicable(Notes on Significant Changes in Shareholders’ Equity)
Not applicable(Additional Information)
Merger with Toyobo Information System Create Co., Ltd.
The Company has resolved to implement an absorption-type merger, effective April 1, 2023, with its
consolidated subsidiary, Toyobo Information System Create Co., Ltd. (hereinafter, “TISC”), at themeeting of the Board of Directors held on December 26, 2022, and entered into a merger
agreement on the same date. Pursuant to Article 796, paragraph 2 (as for the Company) and Article
784, paragraph 1 (as for TISC) of the Companies Act, the merger will be conducted without thegeneral meeting of shareholders of each company on their respective approval for the merger
agreement.
The outline of the merger is as follows.
1. Outline of the transaction(1) Name and content of business of the company involved in the merger
Name of the company involved in the merger: Toyobo Information System Create Co., Ltd.
Content of business: System consulting; system development, operation, and maintenance;
ERP solutions (GRANDIT, Oracle E-Business Suite, etc.); and network solutions(2) Date of the business combination
April 1, 2023
(3) Legal form of the business combination
The merger will be conducted as an absorption-type merger, with the Company as thesurviving company and TISC as the disappearing company, and TISC will be dissolved
upon the merger.
(4) Name of the company after the business combination
TOYOBO CO., LTD.
(5) Other items related to the outline of the transaction(i) Purpose of the merger
The importance of digital technologies has been increasing every year and they havebecome essential in our business activities. Under these circumstances, the Company
decided to conduct an absorption-type merger with TISC, aiming to consolidate the IT
resources of the Group, build a system that can quickly respond to changes in thebusiness environment associated with the advancement and increasing use of digitaltechnologies, and contribute to reforms and growth in the Company’s business.
(ii) Allotment regarding the merger
There was no issuance of new shares or allotment of any other consideration withrespect to the merger.
(iii) Financial position and operating results of the Company involved in the merger for
immediately preceding fiscal year (Fiscal year ended March 31, 2022)
Assets ¥2,083 million
Liabilities ¥1,473 million
10Net assets ¥610 million
Net sales ¥4,190 million
Profit ¥7 million
2. Outline of the accounting method
In accordance with the “Accounting Standard for Business Combinations” (ASBJ Statement No.
21, January 16, 2019) and the “Guidance on Accounting Standard for Business Combinations
and Accounting Standard for Business Divestitures” (ASBJ Guidance No. 10, January 16, 2019),
the merger will be accounted for as a transaction under common control.

11

(Segment Information)(ⅰ) Nine months ended December 31, 2021
(Millions of yen)Segment to Be Reported

Adjustment(Note 2)

Consolidated
Statementsof Income(Note 3)

274,541－

274,541

10,862

11,621(11,621)－

270,135

16,027286,161(11,621)274,541

25,294491

25,785(2,892)

22,893

Other
Businesses(Note 1)

Mobility

LifestyleandEnvironment

Life
ScienceReal
EstateTotal

127,293

32,151

82,40524,585

2,941

269,376

5,165

114

15

300

24

306

759

Total

127,407

32,16782,70524,6093,247

Segment profit(loss)

16,574(1,445)

2,663

6,397

1,105

Films andFunctional
Materials

Total

Net sales(1) Outside
customers(2) Inter-segment
sales andtransfers

Note:
1. Other includes design and construction of buildings, equipment, etc., information services, logistics
services and other items.
2. Segment profit or loss adjustment of (¥2,892) million includes eliminations of intersegment transactionsof (¥199) million and companywide expenses that are not allocated across reporting segments of(¥2,693) million. The principal components of companywide expenses are those related to basic
research and development.
3. Segment profit or loss has been adjusted with operating profit on the consolidated financial statements.
(ⅱ) Nine months ended December 31, 2022
(Millions of yen)Segment to Be Reported

Other
Businesses(Note 4)

Adjustment(Note 5)

Consolidated
Statementsof Income(Note 6)

Films andFunctional
Materials

Mobility

LifestyleandEnvironment

128,304

37,211

94,537

29,3203,124

292,496

6,242

298,738－

298,738

99

20

183

34

301

636

11,176

11,812(11,812)－

128,40337,23094,71929,354

3,424

293,131

17,418

310,550(11,812)298,738

4,508(2,949)

1,584

7,968

1,204

12,315450

12,765(3,197)

9,568

Life
ScienceReal
Estate

Total

Total

Net sales(1) Outside
customers(2) Inter-segment
sales andtransfers
Total
Segment profit(loss)Note:
4. Other includes design and construction of buildings, equipment, etc., information services, logistics
services and other items.
5. Segment profit or loss adjustment of (¥3,197) million includes eliminations of intersegment transactionsof (¥202) million and companywide expenses that are not allocated across reporting segments of(¥2,995) million. The principal components of companywide expenses are those related to basic
research and development.
6. Segment profit or loss has been adjusted with operating profit on the consolidated financial statements.

12

(Significant Subsequent Events)
Company split involving the spin-off of the functional materials business to wholly owned subsidiary
The Company decided at a board of directors meeting held on January 25, 2023 that Toyobo MC
Corporation (“the New Company” hereafter), a wholly owned subsidiary that is established on
September 5, 2022, will succeed the Company’s business involving functional materials through anabsorption-type company split (“the Company Split” hereafter). The Company Split is scheduled to
go into effect on April 1, 2023.
1. Background and Aim
The Company has signed an agreement with Mitsubishi Corporation (headquartered in
Chiyoda-ku, Tokyo, and headed by Representative Director, President & CEO Katsuya Nakanishi;“MC” hereafter) to set up the New Company, after which the Company Split is carried out and an
investment from MC (“the Investment” hereafter) is provided to the New Company with the aim of
sharpening the competitive edge of the Company’s functional materials and continuing to provide
solutions globally. The Company and MC have since been considering how to implement theCompany Split and the Investment. The Company Split is to be implemented as part of theprocedure in the runup to the contract shareholders’ agreement between the Company and MC
and the start of the joint venture.
2. Summary of the Company Split(1) Schedule of the Company Split

Date of decision at the board of directors meeting
Date of sealing the agreement on the absorption-type company split
Effective date of the Company Split

January 25, 2023
January 25, 2023
Scheduled for April 1, 2023

(Note) The Company Split is scheduled to be carried out without the approval at a generalshareholders’ meeting, because it falls under a simple absorption-type company split
prescribed by Paragraph 2, Article 784 of the Companies Act.
(2) Method of the Company Split
The Company will be the split company and the New Company will be the succeedingcompany in the absorption-type company split (simple absorption-type company split).
(3) Allocations of shares due to the Company Split
At the time of the Company Split, the New Company will newly issue 31,000 common shares
and allocate them to the Company as compensation for the Company Split.
(4) Handling of the stock acquisition right and bond with stock acquisition right due to theCompany Split
Not applicable.
(5) Capital stock subject to change due to the Company Split
No change in the capital stock for the split company (the Company).
(6) Rights and obligations that the succeeding company succeeds
The New Company will succeed what the absorption-type company split contract stipulates
regarding the assets, liabilities, and rights and obligations such as contractual status, which are
related to the functional materials business described in 4. below.
(7) Projected execution of debt obligations
We deem there is no projected problem for the succeeding company to execute debt
obligations it must shoulder after the Company Split goes into effect.

13

3. Outline of those involved in the Company Split
Split company
1) Company name2) Address

Toyobo Co., Ltd.
1-13-1, Umeda, Kita-ku, Osaka3) Title and name ofrepresentative (Note 1)

President and Representative
Director,
Ikuo Takeuchi
Business related to films andfunctional materials; mobility;
lifestyle and environment;
life science
51,730 million yen
June 26, 1914

4) Business description

Succeeding company(The New Company)
Toyobo MC Corporation
Osaka Umeda Twin Towers South, 113-1, Umeda, Kita-ku, Osaka
Director, Chikao Morishige(The Company’s Representative
Director, Co-COO and CTO)
Planning, development, manufacturing
and sales of products related tofunctional materials5) Capital stock
100 million yen
6) Date of
September 5, 2022
establishment
7) End of each
March 31
March 31accounting term8) Business performance and fiscal conditions of the latest business year (Note 2)
Net assets
197,149 million yen
Total assets
517,774 million yen
There is no ended business year.
Net assets per share
2,192.17 yen(Note 1): After the Company Split is made, another representative will be selected from MC,
increasing the number to two.
(Note 2): The Company’s data are based on the consolidated settlement of accounts for thebusiness year ended in March 2022.
4. Business operations of the division that will be spun off and succeeded by the New Company
Business related to planning, development, manufacturing and sales of functional materials inJapan and overseas (business related to polymerization development, Vylon and Hardlen, photofunctional materials, fine chemicals, engineering plastics, water treatment membranes,
environment solution devices, activated carbon products, activated carbon fibers, spun-bonded
fabrics, lifestyle materials, high-performance fibers), and businesses related to these businesses.
5. Other important items
The Company is scheduled to hold 51% of the shares in the New Company, while MC isscheduled to hold 49% through a third-party allocation of shares for the Investment scheduled forApril 1, 2023, after the Company Split.
6. Outline of the accounting method to be implemented
In accordance with the “Accounting Standard for Business Combinations” (ASBJ Statement No.
21, January 16, 2019) and the “Guidance on Accounting Standard for Business Combinations andAccounting Standard for Business Divestitures” (ASBJ Guidance No. 10, January 16, 2019), theCompany Split will be accounted for as a transaction under common control.

14