Summary of Consolidated Financial Statements for the First Quarter Fiscal 2016 (JPGAAP)
July 29, 2016
Tokuyama Corporation
Stock exchange listings:
Tokyo(URL http://www.tokuyama.co.jp/eng/)
Local Code :4043
Representative:
Hiroshi Yokota, President and Representative Director
Contact:
Taro Kobayashi, General Manager, Corporate Communications & Investor Relations Dept.
+81-3-5207-2552
Scheduled date of dividends payout :Preparation of supplementary quarterly explanatory materials: Yes
Quarterly business results IR briefing to be held:
Yes (for institutional investors and analysts)

1. Consolidated results for fiscal first quarter ended June 30, 2016 (April 1, 2016 - June 30, 2016)(1) Performance

Note: All amounts are rounded down to the nearest million yen.
Net sales
Year-on(millions ofyear change
yen)
[%]

Operating income
Year-on(millions ofyear change
yen)
[%]

Ordinary income
Year-on(millions ofyear change
yen)
[%]

First Quarter Fiscal 2016
73,163
(0.8)
9,531
224.2
6,470
335.2
First Quarter Fiscal 2015
73,7403.5
2,939(47.3)
1,486(67.3)(Note) Comprehensive income: 1st Q FY16: 3,056 million yen [40.6%] 1st Q FY15: 2,173 million yen [(50.5)%]
Profit attributable toowners of parent
Year-on-year(millions of yen)change [%]First Quarter Fiscal 2016
First Quarter Fiscal 2015

5,545
60

(98.3)

Total assets

Net assets(millions of yen)(millions of yen)

Basic earnings per
share

Diluted earnings
per share

(yen)

(yen)

15.91
0.17

15.89
-

Shareholders’Equity ratio(%)

Net assets per
share
(yen)

(2) Consolidated financial position

Jun 30, 2016
Mar 31, 2016
(Reference) Shareholders' equity:

404,950
401,342Jun 30, 2016:

83,15060,20574,351 million yen

18.4
12.8
Mar 31, 2016:

156.22147.9851,473 million yen

2. Dividends（Period）

1st quarter(yen)

Annual dividends per share
2nd quarter 3rd quarter
Year-end
(yen)

(yen)

(yen)

Total
(yen)

Fiscal 2015, ended
0.00
0.00
0.00
Mar 31, 2016
Fiscal 2016, ending
Mar 31, 2017
Fiscal 2016
0.00
0.00
0.00
（Forecast）(Note) Revision of the latest dividends forecast: No*Dividends described above are the status of dividend related to common stock. As for the dividends related to classshares, please refer to “(Reference) Dividends for Class A shares” on page 3.

1

3. Consolidated performance forecast for fiscal 2016 (April 1, 2016 - March 31, 2017)(% indicates the rate of change over the corresponding previous periods respectively)
attributable to Basic earnings
Net sales
Operating income Ordinary income Profit
owners of parent
per share(millions of
yen)

[%]

(millions of
yen)

[%]

(millions of
yen)

[%]

(millions of
yen)

[%]

7,000

151.5

19.37

17,000－46.68

First Half
145,000 (2.8)
14,500 92.1
11,500 118.5
Fiscal 2016
Fiscal 2016
302,000 (1.7)
32,000 38.7
27,000 52.3
(Note) Revision of the latest consolidated performance forecast: No(yen)*Notes(1) Changes in significant subsidiaries during this period: No
Addition to the scope of consolidation: Reduction from the scope of consolidation: (Note) This item means changes in significant subsidiaries with changes in the scope of consolidation
during this period.
(2) Application of accounting methods specific to the preparation of the quarterly consolidated
financial statements: Yes(3) Changes of accounting policies, changes in accounting estimates, and retrospective restatements
i. Changes of accounting policies by revision of accounting standards:
ii. Changes of accounting policies other than the above:iii. Changes in accounting estimates:
iv. Retrospective restatements:

Yes
No
No
No

(4) Number of shares issued (in common stock)i.

Number of shares issued at end of period(including treasury stock):ii.

Number of treasury stock at end of period:iii. Average number of shares over period:First Quarter
Fiscal 2016:
First Quarter
Fiscal 2016:
First Quarter
Fiscal 2016:

349,671,876

Fiscal 2015:

349,671,876

1,835,150

Fiscal 2015:

1,832,788

347,838,880

First Quarter
Fiscal 2015:

347,862,055(Note) Notice on the implementation of quarterly review proceduresThis summary of quarterly consolidated financial statements is not subject to quarterly review procedures inline with the Financial Instruments and Exchange Act. At the point of disclosure of this summary of quarterly
consolidated financial statements, the quarterly consolidated financial statements review procedures in linewith the Financial Instruments and Exchange Act are underway.

(Note) Cautions pertaining to appropriate use of performance forecast and other particular items
The performance forecast and other forward-looking statements contained in this material have been
prepared on the basis of information available at this point and certain assumptions which are judged to
be rational, and may be substantially different from the actual performance because of various factors that
may arise from now on.

2

(Reference) Dividends for Class A shares
Dividends per share related to class shares are as follows
Annual dividends per share
Class A shares
1st quarter2nd quarter3rd quarter
Year-end(Period)
(yen)
(yen)
(yen)
(yen)
Fiscal 2015, ended――――
Mar 31, 2016
Fiscal 2016, ending―
Mar 31, 2017
Fiscal 2016―――
38,082.20(Forecast)

3

Total

(yen)
―

38,082.20

Contents for Accompanying Materials
1. Qualitative information on consolidated results for this quarter…………………

P. 2(1) Explanation concerning business results…………………

P. 2(2) Explanation concerning financial position…………………

P. 6…………………

P. 7

2. Consolidated Quarterly Financial Statements…………………

P. 8(1) Consolidated Quarterly Balance Sheets…………………

P. 8(2) Consolidated Quarterly Statements of Income…………………

P. 10(3) Consolidated Quarterly Statements of Comprehensive Income…………………

P. 11(4) Segment Information…………………

P. 12(3) Explanation concerning information related to future
prediction such as consolidated performance forecast

11. Qualitative information on consolidated results for this quarter(1) Explanation concerning business results
Consolidated results for the first quarter fiscal 2016 (April 1, 2016 - June 30, 2016) aresummarized as follows:(Unit: Millions of yen)
Net sales

Operating income

Ordinary income

Profit attributableto owners ofparentFirst Quarter Fiscal 2016

73,163

9,531

6,470

5,545

First Quarter Fiscal 2015

73,740

2,939

1,486

60

(0.8)

224.2

335.2

-

Rate of change (%)

Net sales
Consolidated net sales decreased 0.8%, or ¥577 million compared with the corresponding periodof the previous year, to ¥73,163 million. Despite an increased sales volume in polycrystalline
silicon for both solar-cells and semiconductors, this was largely attributable to weak selling pricesof petroleum products on the back of a downturn in domestic naphtha prices.
Cost of sales
Cost of sales decreased 12.4%, or ¥6,866 million compared with the corresponding period of
the previous year, to ¥48,514 million. Despite an increased sales volume in polycrystalline silicon,
this was due mainly to a downturn in raw material costs as a result of the drop in domestic
naphtha prices.
SG&A expenses
SG&A expenses decreased 2.0%, or ¥302 million compared with the corresponding period of
the previous year, to ¥15,117 million. Despite the increase in distribution costs associated with
the increase in sales volumes, this decrease primarily reflects a decrease in depreciation cost of
mission-critical systems.
Operating income
Operating income increased 224.2%, or ¥6,591 million compared with the corresponding periodof the previous year, to ¥9,531 million. In addition to a downturn in production costs as a resultof the drop in raw material and fuel prices, this was due mainly to operating rate improvementand decreased depreciation expenses at Tokuyama Malaysia Sdn. Bhd.
2

Non-operating income/expenses, Ordinary income
Non-operating income/expenses deteriorated ¥1,607 million compared with the corresponding
period of the previous year, due chiefly to increase in trial production expenses at Tokuyama
Malaysia Sdn. Bhd.
As a result of the above, ordinary income increased 335.2%, or ¥4,983 million compared withthe corresponding period of the previous year, to ¥6,470 million.
Extraordinary income/losses, Income before income taxes, Profit, Profit attributable toowners of parent
Extraordinary income/losses improved by ¥2,427 million compared with the corresponding
period of the previous year. This was largely attributable to the posting of a subsidy income
related to manufacturing facilities of Tokuyama Malaysia Sdn. Bhd.
As a result of the above, income before income taxes increased 497.7%, or ¥7,411 million
compared with the corresponding period of the previous year, to ¥8,900 million.
Profit after deducting income taxes calculated in an appropriate way increased ¥5,564 million
compared with the corresponding period of the previous year, to ¥5,877 million. Profit
attributable to owners of parent increased ¥5,485 million compared with the corresponding
period of the previous year, to ¥5,545 million.

3

(Operating results by segment)
Sales(Unit: Millions of yen)

Others

Total

Adjustment

Figures inquarterly
consolidated
incomestatement

13,853

13,161

82,765(9,601)

73,163

20,41814,28912,952

83,615(9,875)73,740

(5.0)

(3.0)

1.6

(1.0)

-

(0.8)

Reportable segment

First Quarter
Fiscal 2016
First Quarter
Fiscal 2015
Rate of change (%)

Chemicals

Specialty
Products

CementLife &
Amenity

20,21016,134

19,40422,875

13,080(11.6)

23.4

Operating income(Unit: Millions of yen)

Adjustment

Figures inquarterly
consolidated
incomestatement

10,097

(566)

9,531

1,045

3,670

(731)

2,939

52.6

175.1

-

224.2

Reportable segment

First Quarter
Fiscal 2016
First Quarter
Fiscal 2015
Rate of change (%)

Others

Total

1,825

1,595

941

1,718

77.2

6.2

Chemicals

Specialty
Products

CementLife &
Amenity

2,907

2,101

1,667

1,493

(1,528)

94.6-(Note) Sales and operating income in each segment include inter-segment transactions.

Chemicals
Sales of caustic soda were down compared with the corresponding period of the previous year.
While domestic sales volumes were steady, this decrease was attributable to weak trends in selling
prices.
Sales of vinyl chloride monomer (VCM) were down compared with the corresponding period of
the previous year. Despite an increase in the volume of export mainly for Asian market, thedecline was primarily due to weak trends in selling prices as a result of the drop in domestic
naphtha prices.
Sales of vinyl chloride resin declined. While a recovery in the number of housing starts and otherfactors contributed to firm trends in sales volumes, this downturn largely reflects weak selling
prices as a result of the drop in domestic naphtha prices. Earnings on the other hand improved
due mainly to the suspension of operations at the Chiba factory of Shin Dai-ichi Vinyl
Corporation.
With regard to soda ash and calcium chloride, sales decreased compared with the corresponding
period of previous fiscal year. Despite efforts to revise selling prices, this decrease primarilyreflects decreased sales volume.
4

As a result of the above, segment net sales decreased 11.6% compared with the corresponding
period of the previous year, to ¥20,210 million and operating income increased 94.6% to ¥2,907
million. The segment reported higher earnings on lower sales.
Specialty Products
Sales of semiconductor-grade polycrystalline silicon increased. This was primarily due to robust
shipping reflecting the growing trend to highly functional mobile devices including smartphones.
Sales of solar-grade polycrystalline silicon increased on the back of higher sales volumes,reflecting the operating rate improvement at Tokuyama Malaysia Sdn. Bhd.
Sales of fumed silica were on per compared with the corresponding period of previous fiscal
year due to steady sales of such applications as a polishing material for semiconductors.
With regard to high-purity chemicals for electronics manufacturing, sales decreased comparedwith the corresponding period of the previous year. Despite robust sales volume in suchapplications as semiconductor manufacturing, this decrease was mainly owing to such factors as
continuing appreciated yen.
With regard to aluminum nitride, sales increased compared with the previous fiscal year. This was
attributable to an increase in sales volumes of such applications used for semiconductor
manufacturing equipment.
As a result of the above, segment net sales increased 23.4% compared with the corresponding
period of the previous year, to ¥16,134 million and operating income increased to ¥2,101 million.
The segment reported higher earnings on higher sales.
CementSales of cement were for the most part flat. During the period under review, the downturn insales volumes attributable to weak public- and private-sector demand in Japan was offset by anincrease in the volume of exports on the back of robust demand in the Asia region. Meanwhile,
successful steps were taken to reduce manufacturing costs. In addition to a drop in raw material
and fuel prices, this reduction on manufacturing costs was mainly due to improvements in thebasic unit of production.
In the recycling and environment-related business, the Company accepted a higher volume ofwaste including coal ash compared with the previous fiscal year. As a result of this, sales
increased from the previous fiscal year.
Consolidated subsidiary net sales declined. This mainly reflected corrections to robust shipping
trends of such products as ready-mixed concrete targeting large-scale projects in thecorresponding period of the previous fiscal year.
As a result of the above, segment net sales decreased 5.0% compared with the corresponding
period of the previous year, to ¥19,404 million and operating income increased 77.2% to ¥1,667
million. The segment reported higher earnings on lower sales.
5Life & Amenity
Sales of active pharmaceutical ingredients increased compared with the corresponding period of
the previous year, owing mainly to the upswing in the sales volumes of generic pharmaceuticals.
With regard to microporous film, sales of such applications as sanitary articles including
disposable diapers decreased. As a result of this, sales decreased compared with thecorresponding period of the previous year.
With regard to polyolefin film, sales were declined compared with the corresponding period of
the previous year. Despite firm trends in sales mainly for application in packaging materials for
products sold at convenience stores, this decrease was largely the result of weak trends in selling
prices on the back of the decline in domestic naphtha prices.
With regard to dental materials and equipment, sales increased compared with the previous fiscal
year, due to higher sales volumes of new products and an increase in the volume of export.
With regard to medical diagnosis systems, sales were down compared with the corresponding
period of the previous year. This largely reflected corrections to robust shipping trends targetinglarge-scale projects in the corresponding period of the previous fiscal year.
As a result of the above, segment net sales decreased 3.0% compared with the corresponding
period of the previous year, to ¥13,853 million and operating income increased 6.2% to ¥1,825
million. The segment reported higher earnings on lower sales.

(2) Explanation concerning financial position(Status of assets, liabilities and net assets)
As of June 30, 2016, total assets amounted to ¥404,950 million, an increase of ¥3,608 million
compared with those as of March 31, 2016.
Despite a decrease of ¥5,901 million in notes and accounts receivable – trade, this increaseprimarily reflects an increase of ¥10,687 million in cash and deposits.
Total liabilities amounted to ¥321,799 million, down ¥19,336 million compared with those as ofMarch 31, 2016.
This largely reflected the downturn in the balances of income taxes payable, long-term loans
payable and current portion of long-term loans payable, short-term loans payable, notes andaccounts payable―trade of ¥9,122 million, ¥5,293 million, ¥2,776 million, and ¥2,652 million,
respectively.
Net assets totaled ¥83,150 million, an increase of ¥22,945 million compared with those as ofMarch 31, 2016.
The principal movement was the increase in shareholders' equity of ¥20,000 million as a resultof issuance of class A shares.
6

(3) Explanation concerning information related to future prediction such as
consolidated performance forecast
Although the future business environment is uncertain because of the fluctuations in spot priceof such product as solar-grade polycrystalline silicon, exchange rate and raw material and fuelprices, the Company’s results were in line with our expectations at this time. Therefore, theCompany has not revised the performance forecasts, announced on May 12, 2016.
The performance forecast has been prepared on the basis of information available at this pointand certain assumptions which are judged to be rational, and may be substantially different fromthe actual performance because of various factors that may arise from now on.

7

2. Consolidated Quarterly Financial Statements(1) Consolidated Quarterly Balance Sheets
Millions of yen
3/31/2016
6/30/2016
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Lease receivables and investment assets
Merchandise and finished goods
Work in process
Raw materials and supplies
Deferred tax assets
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Machinery, equipment and vehicles
Accumulated depreciation
Machinery, equipment and vehicles, net
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net
Land
Leased assets
Accumulated depreciation
Leased assets, net
Construction in progress
Total property, plant and equipment
Intangible assets
Goodwill
Leased assets
Other
Total intangible assets
Investments and other assets
Investment securities
Long-term loans receivable
Deferred tax assets
Net defined benefit asset
Other
Allowance for investment loss
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

8

121,508
68,5696
14,012
10,882
15,933
4,256
8,788
(192)
243,766

132,196
62,668
6
14,86910,74017,136
3,277
8,358
(154)
249,100

101,982(74,022)
27,959461,619(410,707)
50,912
22,661(20,890)
1,771
31,3272,237(1,041)
1,196
6,597
119,764

101,581(73,990)
27,590460,310(411,515)
48,79522,498(20,805)
1,693
31,261
2,381(1,119)1,262
7,197
117,800

3,738
41
2,613
6,393

3,230
44
2,531
5,806

15,765
3,094
610
8,057
4,190
(22)
(278)
31,417
157,575
401,342

15,177
3,079
1,884
8,579
3,722
(22)
(178)
32,243
155,850
404,950

Millions of yen
3/31/2016
6/30/2016
Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term loans payable
Commercial papers
Current portion of long-term loans payable
Current portion of bonds
Lease obligations
Income taxes payable
Deferred tax liabilities
Provision for bonuses
Provision for repairs
Provision for product warranties
Provision for loss on purchase contract
Other
Total current liabilities
Non-current liabilities
Bonds payable
Long-term loans payable
Lease obligations
Deferred tax liabilities
Provision for directors' retirement benefits
Provision for repairs
Allowance for loss on compensation for building materials
Provision for environmental measures
Provision for loss on purchase contract
Net defined benefit liability
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

935,388
9,382－
17,036
10,000356
11,888
2
1,830
1,480
85
2,656
23,093
113,200

32,7356,606
2,000
14,913
10,000
358
2,765
2
1,220
2,914
83
2,512
22,70098,81434,400172,877
931
457
231
3,691
384
85
2,716
1,354
6
10,799227,935
341,136

34,400169,707
999
473
172
3,253
364
186
1,728
1,368
6
10,325
222,985
321,799

53,45857,532(61,281)(1,439)48,27010,00039,062
26,198(1,440)73,820(1,020)
(526)
2,362
2,386
3,202
8,732
60,205
401,342(1,482)
(665)
274
2,404
531
8,799
83,150404,950

(2) Consolidated Quarterly Statements of Income
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Selling expenses
General and administrative expenses
Total selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Share of profit of entities accounted for using equity method
Refund of fixed asset tax
Dividends Income Of Group Term Insurance
Other
Total non-operating income
Non-operating expenses
Interest expenses
Trial production expenses
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Subsidy income
Reversal of Provision for loss on purchase contract
Gain on insurance adjustment
Total extraordinary income
Extraordinary losses
Loss on sales of non-current assets
Loss on disaster
Loss on reduction of non-current assets
Loss on disposal of non-current assets
Provision for environmental measures
Loss on transfer from business divestitures
Other
Total extraordinary losses
Profit before income taxes
Income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

10

Millions of yen
Q1 FY2015
Q1 FY2016
73,74073,16355,38048,514
18,35924,6489,260
6,159
15,420
2,939

9,394
5,722
15,117
9,531

36
251
199
－
198
218
904

11
144
212
250
175
261
1,055

1,175
214
967
2,356
1,486

1,096
1,693
1,325
4,115
6,470

1
－
19
11
16
49

3
1
2,298
517
－
2,820

－
－
23
24
－
－
－
47
1,488
1,175
313
253
60

1
4
50
101
101
98
33
391
8,900
3,022
5,877
332
5,545

(3) Consolidated Quarterly Statements of Comprehensive Income

ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities accounted for using equity
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests

Millions of yen
Q1 FY2015
Q1 FY2016
313
5,877
1,308
(5)
570
(1)
(11)
1,860
2,173

(468)
(169)
(2,086)18(115)(2,821)
3,056

1,887
286

2,873
182

*Notes to Consolidated Quarterly Financial Statements(Significant Changes in Shareholders' Equity)
On June 24, 2016, the Company transferred part of Capital stock to Capital surplus. The Company alsotransferred part of Capital surplus to Retained earnings. On June 27, 2016, the payment for the issuance of theClass A shares from Japan Industrial Solutions Fund I has been completed. And the Company transferred thetotal amount of the Capital stock, which increased as a result of issuance of Class shares, to Capital surplus.
Due chiefly to the above, the Capital stock as of June 30, 2016, decreased by ¥43,458 million compared withthose as of March 31, 2016, to ¥10,000 million, the Capital surplus decreased by ¥18,470 million to ¥39,062
million, and the Retained earnings increased ¥87,479 million to ¥26,198 million.

11

(4) Segment information
First Quarter Fiscal 2015 (April 1, 2015 – June 30, 2015)
1. Information on sales and income (loss) by reportable segment(Millions of yen)
Reportable segments

Sales
Sales to customers
Inter-segment sales/transfer
Total
Segment income

Chemicals

Specialty
Products

Cement22,723
152
22,875
1,493

9,267
3,812
13,080(1,528)20,38730
20,418941

Life &
Amenity

13,761527
14,289
1,718

Others*1

Total

7,600
5,351
12,952
1,045

73,7409,875
83,615
3,670

Adjustment*2

Figures inquarterly
consolidated
incomestatement*3(9,875)(9,875)(731)

73,74073,7402,939*1 The “Others” segment comprises businesses other than those of the reportable segments. Specifically, thesegment includes overseas sales companies, a distribution company, a real estate business, etc.
*2 The segment income adjustment amount consists mainly of basic R&D expenses that are not allocable to a
specific reportable segment.
*3 With regard to segment income, operating income in the quarterly consolidated statement of income has
been calculated by making an adjustment to the sum total of the reportable segments’ income and the “Others”
segment’s income.

First Quarter Fiscal 2016 (April 1, 2016– June 30, 2016)
1. Information on sales and income (loss) by reportable segment(Millions of yen)
Reportable segments

Sales
Sales to customers
Inter-segment sales/transfer
Total
Segment income

Chemicals

Specialty
Products

Cement19,999211
20,2102,907

13,3882,746
16,134
2,101

19,37726
19,404
1,667

Life &
Amenity

13,342511
13,853
1,825

Others*1

Total

7,056
6,105
13,161
1,595

73,1639,601
82,765
10,097

Adjustment*2

Figures inquarterly
consolidated
incomestatement*3(9,601)(9,601)(566)

73,16373,1639,531*1 The “Others” segment comprises businesses other than those of the reportable segments. Specifically, thesegment includes overseas sales companies, a distribution c ompany, a real estate business, etc.
*2 The segment income adjustment amount consists mainly of basic R&D expenses that are not allocable to a
specific reportable segment.
*3 With regard to segment income, operating income in the quarterly consolidated statement of income has
been calculated by making an adjustment to the sum total of the reportable segments’ income and the “Others”
segment’s income.

12