NOTICE: For the convenience of capital market participants, NIPPON PAINT HOLDINGS CO., LTD. Provides
English translation of the information disclosed in Japanese, provided that the original Japanese version prevails overits English translation version in the case of any discrepancy found between the original and translation.

Consolidated Financial Results
for the Fiscal Year Ended December 31, 2018
[Japanese GAAP]
February 13, 2019
Company name: NIPPON PAINT HOLDINGS CO., LTD.
Stock exchange listing: Tokyo Stock Exchange
Code number: 4612
URL: http://www.nipponpaint-holdings.com/
Representative: Tetsushi Tado, Representative Director and President
Contact: Yukiko Mochida, Manager of Investor Relations Office
Phone: +81-6-6455-9140
Scheduled date of annual general meeting of shareholders: March 27, 2019
Scheduled date of commencing dividend payments: March 28, 2019
Scheduled date of filing the securities report: March 28, 2019
Availability of supplementary briefing material on consolidated financial results: Yes
Schedule of consolidated financial results briefing session: Yes(Amounts of less than one million yen are rounded down.)
1. Consolidated Financial Results for the Fiscal Year Ended December 31, 2018 (January 1, 2018 to
December 31, 2018)(1) Consolidated Operating Results(% indicates changes from the previous corresponding period.)
Profit attributable to
Net sales
Operating profit
Ordinary profit
owners of parent
Fiscal year ended
Million yen%
Million yen%
Million yen%
Million yen%
622,987
2.9
66,231 (11.6)
72,304(5.9)
34,195(7.9)
December 31, 2018
December 31, 2017605,252－
74,957－
76,820－37,123－
Note: Comprehensive income: Fiscal year ended December 31, 2018: ¥24,765 million [ (63.0)%]
Fiscal year ended December 31, 2017: ¥66,970 million [ - %]Total assets
Net sales
Basic earnings Diluted earnings
Rate of return
Ordinary profit Operating profit
per shareper shareon equity
ratio
ratio
Fiscal year ended
Yen
Yen
%
%
%
106.63106.61
6.8
7.8
10.6
December 31, 2018
December 31, 2017115.76115.747.6
8.8
12.4
Reference: Equity in earnings (losses) of affiliates: Fiscal year ended December 31, 2018: ¥1,250 million
Fiscal year ended December 31, 2017: ¥1,217 million
The Company has changed its fiscal year-end from March 31 to December 31 from the fiscal year ended December
31, 2016. Accordingly, percentage changes from the previous consolidated fiscal year are not presented, since theconsolidation periods for the fiscal year ended December 31, 2017 (January 1, 2017 to December 31, 2017) andfor the fiscal year ended December 31, 2016 (April 1, 2016 to December 31, 2016) differ from each other.
(2) Consolidated Financial Position
Total assets
Million yen

Net assets

Net assets per
share

Equity ratio

Million yen%

Yen

936,030
628,767
As of December 31, 2018
920,591
629,408
As of December 31, 2017
Reference: Equity: As of December 31, 2018: ¥502,323 million
As of December 31, 2017: ¥504,336 million

53.7
54.8

1,566.27
1,572.60

(3) Consolidated Cash Flows
Cash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities

Cash and cash
equivalents at endof period

Million yen

Million yen

Million yen

Million yen

59,177
79,265(37,355)(100,680)

8,632(11,434)

128,444
100,560

As of December 31, 2018
As of December 31, 2017
2. Dividends

Annual dividends

Dividend
payoutratio(Consolidated)

Dividend/Net
assets(Consolidated)

1stquarter-end

2ndquarterend

Yen

Yen

Yen

Yen

Yen

Million
yen

%

%

－

20.00

－

22.00

42.00

13,469

36.3

2.8

－

22.00

－

23.00

45.00

14,431

42.2

2.9

－

22.00

－

23.00

45.00

Fiscal year ended
December 31, 2017
Fiscal year ended
December 31, 2018
Fiscal year ending
December 31, 2019
(Forecast)

3rd
quarter- Year-end
end

Total
dividends
paid(Total)

Total

37.0

3. Consolidated Financial Results Forecast for the Fiscal Year Ending December 31, 2019 (January 1, 2019 to
December 31, 2019)(% indicates changes from the previous corresponding period.)
Profit attributable
Basic earnings
Net sales
Operating profit
Ordinary profit
to owners of parent
per share
Million yen%

Million yen%

Million yen%

Million yen%

Yen

First half
310,000－
39,500－40,000－20,000－62.36
Full year
640,000－
77,000－78,000－39,000－121.60
The Company voluntarily apply International Financial Reporting Standards (IFRS) starting from consolidated
financial statements in the securities report for the fiscal year ended December 31, 2018. Accordingly,
consolidated financial results for the fiscal year ending December 31, 2019 are prepared based on IFRS.

* Notes:(1) Changes in significant subsidiaries during the period under review: No(2) Changes in accounting policies, changes in accounting estimates and restatement
1) Changes in accounting policies due to the revision of accounting standards: No
2) Changes in accounting policies other than 1) above: No
3) Changes in accounting estimates: No4) Restatement: No(3) Total number of issued shares (common shares)
1) Total number of issued shares at the end of the period (including treasury shares):December 31, 2018: 325,402,443 shares
December 31, 2017: 325,402,443 shares2) Total number of treasury shares at the end of the period:
December 31, 2018: 4,689,703 shares
December 31, 2017: 4,700,301 shares
3) Average number of shares during the period:
Fiscal year ended December 31, 2018: 320,704,276 sharesFiscal year ended December 31, 2017: 320,702,897 shares*These consolidated financial results are outside the scope of audit by Certified Public Accountants or auditing
corporations.
*Explanation of the proper use of financial results forecast and other notes(Caution concerning forward-looking statements)
The earnings forecasts and other forward-looking statements herein are based on information currently available to
the Company and certain assumptions that are judged to be reasonable, and the Company does not in any way
guarantee the achievement of the projections. Actual results, etc. may differ greatly from the forecast figuresdepending on various factors.

Table of Contents
1. Overview of Financial Results ......................................................................................................... 2(1) Overview of Financial Results for the Period under Review ......................................................... 2(2) Overview of Financial Position for the Period under Review ........................................................ 3(3) Overview of Cash Flows for the Period under Review……………………………………………..4(4) Future Outlook ……………………………………………………………………………………...4
2. Basic Approach to Selection of Accounting Standards………………………………………………..5
3. Consolidated Financial Statements and Primary Notes ................................................................... 6(1) Consolidated Balance Sheets………………………………………………………………………..6(2) Consolidated Statements of Income and Comprehensive Income…………………………………..8(3) Consolidated Statements of Changes in Equity ……………………………………………………10(4) Consolidated Statements of Cash Flows …………………………………………………………...12(5) Notes to Consolidated Financial Statements……………………………………………………...13(Notes on going concern assumption) …………………………………………………………13(Changes in methods of presentation) …………………………………………………………..13(Segment information) …………………………………………………………………………..14(Per-share information) …………………………………………………………………………..17(Significant subsequent events) ………………………………………………………………….17
4. Other …………………………………………………………………………………………………...18(1) State of Sales Performance ………………………………………………………………………….18

1

1. Overview of Financial Results(1) Overview of Financial Results for the Period under Review
The period of consolidation for the fiscal year ended December 31, 2018 is the twelve months fromJanuary to December 2018.
During the fiscal year ended December 31, 2018, consolidated net sales of the Company and its groupcompanies (collectively, the “Group”) increased by 2.9% from the corresponding period of the previous year(the “previous year”), to ¥622,987 million. Consolidated operating profit decreased by 11.6% from the previous
year, to ¥66,231 million due to the effects of an increase in raw material prices, and consolidated ordinary profit
decreased by 5.9% from the previous year, to ¥72,304 million partly due to the recording of the subsidy income
related to the removal of factories resulting from an environmental regulation in China. Profit attributable toowners of parent decreased by 7.9% from the previous year, to ¥34,195 million due to the gain on sales of noncurrent assets following the closure of Neyagawa office, offset by the effect of changes in the U.S. tax system inthe previous fiscal year.
Results by business segment are as follows.
Japan
In this region, although the number of automobiles manufactured was at the same level as the previous year,
net sales of automotive coatings were higher than the previous year due to factors such as favorable shipments
of premium design and high value-added coatings and the contribution from expanded sales of coatings forautomotive parts. As for industrial coatings, despite a lower number of new housing starts than the previous year,
net sales were higher than the previous year due to factors such as increased shipments of powder paints andcoatings for colored steel sheets in line with restoration works following the natural disasters that occurred from
June to September. As for trade-use paints, despite the sluggish market conditions, net sales were higher than theprevious year due to factors such as efforts to expand our market share in the retail sector by introducing new
products. As for other coatings, net sales were lower than the previous year mainly due to factors such as the
sluggish market conditions of marine coatings.
As a result of these factors, consolidated net sales for the Japan segment increased by 1.3% from the previous
year, to ¥178,133 million. Consolidated operating profit decreased by 3.6% from the previous year, to ¥41,621
million due to the effects of an increase in raw material prices and an increase in selling, general andadministrative expenses. ¥14,012 million of dividend income from overseas group companies (¥12,543 million
in the previous year) is included in consolidated operating profit. All of this dividend income is eliminated as aninternal transaction under “Inter-segment transaction eliminations and other adjustments.”
Asia
In this region, net sales for automotive coatings were higher than the previous year, despite a decrease in thenumber of automobiles manufactured in China from the previous year, due to factors such as favorable production
by Japanese and South Korean manufacturers, coupled with expanded business in the commercial vehicles sector
and to Chinese manufacturers, as well as an increase in the number of automobiles manufactured in Thailand. As
for trade-use paints, which account for the highest ratio of business, net sales were higher than the previous year
due to an increase of sales to major customers in sectors focusing on decorative paints for exterior, despite thesluggish market conditions in housing sales due to the strengthening of housing investment regulations in China,
and favorable sales in Singapore and Malaysia. In industrial coatings, net sales were lower than the previous year,
owing primarily to a decrease in shipments of coatings for construction materials.
As a result of these factors, consolidated net sales for the Asia segment increased by 2.5% from the previous
year, to ¥355,746 million. Consolidated operating profit decreased by 11.7% from the previous year, to ¥36,066
million mainly due to the effects of an increase in raw material prices.
2Americas
In this region, net sales for automotive coatings decreased from the previous year due to the effects of
exchange rate, despite efforts to expand sales of coatings for automotive parts amid sluggish production of
automobiles in the United States, a core region. In trade-use paints, consolidated net sales increased significantly
from the previous year due to increased openings of paint stores coupled with the full twelve-month contribution,compared with ten months in the previous year, from the results of DUNN-EDWARDS CORPORATION, adecorative paints manufacturer, which was consolidated in March 2017.
As a result of these factors, consolidated net sales for the Americas segment increased by 10.2% from theprevious year, to ¥75,207 million. Consolidated operating profit decreased by 2.8% from the previous year to¥3,080 million mainly due to the effects of an increase in raw material prices.
Other
In this segment, regarding automotive coatings, consolidated net sales decreased by 1.3% from the previous
year to ¥13,900 million due to the effects of exchange rate, despite steady shipments to Japanese and French
manufacturers, and consolidated operating loss was ¥677 million, compared to an operating profit of ¥248 million
in the previous year mainly due to the effects of an increase in raw material prices.

(2) Overview of Financial Position for the Period under Review
Total assets at the end of the fiscal year under review increased by ¥15,439 million from the end of theprevious fiscal year to ¥936,030 million. Current assets increased by ¥46,354 million, mainly due to a decrease
in securities and inventories, offset by increases in cash and deposits and accounts receivable - trade. Additionally,
non-current assets decreased by ¥30,915 million from the end of the previous fiscal year, primarily caused byfactors such as decreases in trademark rights and goodwill in line with their amortization and a decrease ininvestment securities resulting from the fall in share prices.
Liabilities increased by ¥16,080 million from the end of the previous fiscal year to ¥307,262 million. The
increase was mainly attributable to a decrease in notes and accounts payable - trade and deferred tax liabilities,
offset by an increase in loans payable.
Net assets decreased by ¥640 million from the end of the previous fiscal year to ¥628,767 million. This was
mainly attributable to an increase in retained earnings due to the recording of profit attributable to owners ofparent, offset by decreases in valuation difference on available-for-sale securities and foreign currency translation
adjustment.
As a result, equity ratio fell from 54.8% at the end of the previous fiscal year to 53.7%.

3

(3) Overview of Cash Flows for the Period under Review
Business operations for the fiscal year ended December 31, 2018 resulted in an inflow of ¥59,177 million,
investing activities resulted in an outflow of ¥37,355 million, and financing activities resulted in an inflow of¥8,632 million, resulting in cash and cash equivalents (hereinafter “cash”) of ¥128,444 million, an increase of¥27.883 billion compared to the end of the previous consolidated fiscal year.
(Cash flows from operating activities)
Net cash provided by operating activities was ¥59,177 million. Primary factors include a decrease in cashof ¥8,941 million due to an increase in operating capital and income taxes paid of ¥24,595 million, despite a cash
inflow (excluding increases and decreases in operating capital) of ¥92,714 million, reflecting mainly non-cash
expenses such as depreciation and amortization on profit before income taxes.
(Cash flows from investing activities)
Net cash used in investing activities was ¥37,355 million. This was mainly attributable to an outflow of¥55,398 million due partly to the purchase of property, plant and equipment and payments into time deposits,
despite the inflow of ¥12,456 million due to a decrease in securities.
(Cash flows from financing activities)
Net cash provided by financing activities was ¥8,632 million. Primary factors include an inflow of ¥34,631
million due to an increase in loans payable and cash dividends paid of ¥26,148 million.

(4) Future Outlook
For the next period (period ending December 31, 2019), the domestic economy is forecast to be robust, led
by domestic demand as the Japanese economy continues in a recovery trend. Under such circumstances, theCompany will strive to expand its market share in each business sector, including automotive coatings, trade-use
paints and industrial coatings, and secure its presence in crucial markets. Additionally, we will work to ensureprofits by continuing to revise product prices within an appropriate range, coupled with cost reductions and cost
control, including selling, general and administrative expenses, in the midst of an uncertain outlook as evidenced
by trade frictions in major countries and the increase in the consumption tax planned for October 2019.
The business climate in Asia is forecast to continue experiencing slower growth in the housing-related
market due to continued real estate investment control measures in China, a core region. In addition to this,uncertainties such as a decline in personal consumption against the backdrop of trade friction and trends in raw
material prices due to strengthened environmental regulations are also forecast. Under such circumstances, wewill further increase added-value for products and services throughout Asia by engaging in business operation asa unified group with the NIPSEA Group (*), a joint venture in the region. Specifically, in the interior residential
paint field in which we hold the top domestic market share in China, and which accounts for the majority of sales
in our China business, we aim to further expand our market share including in regional cities where continued
growth is expected going forward, by taking advantage of our high brand strength and a nationwide sales network.
In the automotive coatings business, we will make efforts to expand our market share among Chinese andJapanese manufacturers amid predictions for the number of automobiles manufactured to remain at the samelevel as the previous fiscal year. Similarly, in other countries in Asia, we are promoting the creation and rousingof demand for trade-use paints, automotive coatings and other products to raise our market presence.
In the Americas, we will endeavor to expand market share for automotive coatings amid predictions for thenumber of automobiles manufactured in the region, including Mexico, to fall below the preceding fiscal year. In
the construction paints business, which we are developing mainly in the southwest of the USA, we aim to increase
our net sales, including at existing stores, through openings of new paint stores.
In other regions, we will strive to increase our net sales for automotive coatings as well as improve4

profitability amid forecasts for the number of automobiles manufactured in Europe to remain at the same level
as the previous fiscal year.
As a result of the above factors, our outlook for next fiscal year’s consolidated business performance is¥640.0 billion in net sales, ¥77.0 billion in operating profit, ¥78.0 billion in profit before income taxes, and ¥39.0
billion in profit attributable to owners of parent.
Since the Company has voluntarily decided to adopt International Financial Reporting Standards (IFRS) for
its consolidated financial statements in the annual securities report from the fiscal year ended December 31, 2018,
the Consolidated Financial Results Forecast is based on IFRS.
Additionally, based on these financial results forecasts, we plan a full-year dividend of ¥45.0 for the next
fiscal year.
(*) Asian joint venture together with WUTHELAM HOLDINGS LTD., a collaborative partner based in
Singapore

2. Basic Approach to Selection of Accounting Standards
In order to further promote global management, improve the comparability of financial information andenhance disclosure by standardizing accounting procedures amongst group companies, the Company voluntarily
adopts International Financial Reporting Standards (IFRS) for consolidated financial statements in its annual
securities reports from the fiscal year ended December 31, 2018.

5

3. Consolidated Financial Statements and Primary Notes(1) Consolidated Balance Sheets(Million yen)
As of December 31, 2017

As of December 31, 2018

103,007
153,922
15,40237,47738,198
4,032
26,174
7,278
20,800(4,394)401,900

164,063
157,432
16,63023,44738,351
4,061
23,295
5,967
19,417(4,413)448,255

123,589(59,559)
64,029106,609(74,563)
32,04525,398(20,139)
5,259
28,3642,681(1,153)
1,528
11,652
142,880

125,257(61,236)
64,020108,585(76,069)
32,51625,235(20,005)
5,230
27,5842,874(1,358)1,516
13,336144,204

197,051
61,87054,295313,216

180,270
57,51250,404
288,188

57,619
1,143
77
3,834
(82)
62,593
518,690920,591

50,082
959
42
4,335
(37)
55,382487,775
936,030

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Electronically recorded monetary claims - operating
Securities
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
Trademark right
Other
Total intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Net defined benefit asset
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

6

(Million yen)
As of December 31, 2017
Liabilities
Current liabilities
Notes and accounts payable - trade
Electronically recorded obligations - operating
Short-term loans payable
Current portion of long-term loans payable
Income taxes payable
Provision for product compensation
Other
Total current liabilities
Non-current liabilities
Long-term loans payable
Lease obligations
Deferred tax liabilities
Provision for directors’ retirement benefits
Provision for environmental measures
Net defined benefit liability
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
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Share acquisition rights
Non-controlling interests
Total net assets
Total liabilities and net assets

7

As of December 31, 2018

79,94022,38018,274
7,080
6,046
2,340
63,150199,21276,03622,48841,294
10,171
4,709
302
58,712
213,715

31,741846
33,337191264
17,398
8,190
91,970291,182

37,831
874
29,521383
325
18,671
5,937
93,547307,262

78,862
63,262
385,369(6,454)
521,040

78,862
63,247405,454(6,444)541,119

12,068(25,387)(3,384)(16,703)
136
124,934
629,408
920,591

7,388(41,663)(4,521)(38,796)156
126,288628,767
936,030

(2) Consolidated Statements of Income and Comprehensive Income
Consolidated Statements of Income

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Share of profit of entities accounted for using equity
methodGain on investments in securities
Subsidy income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Purchasing-related expense
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of non-current assets
Gain on sales of shares of subsidiaries and associates
Other
Total extraordinary income
Extraordinary losses
Loss on sales and retirement of non-current assets
Product compensation expenses
Other
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

For the fiscal year ended
December 31, 2017605,252
360,055
245,196
170,239
74,957

8(Million yen)
For the fiscal year ended
December 31, 2018
622,987
382,124
240,862
174,631
66,231

1,147
965

1,466
1,040

1,217

1,250

1,424
983
1,262
7,000

1,922
3,878
1,061
10,619

1,081
1,381
750
1,923
5,137
76,820

1,260
1,630
1,654
4,545
72,304

223
899
4
1,127

5,621
118
5,740

728
2,340
106
3,175
74,771
22,210(4,757)
17,45257,31820,19537,123663
217
881
77,16322,543
173
22,71654,446
20,25034,195

Consolidated Statements of Comprehensive Income(Million yen)

ProfitOther comprehensive income

For the fiscal year ended
December 31, 201757,318For the fiscal year ended
December 31, 2018
54,446

2,024
5,140
1,843

(5,018)(22,521)(1,226)

644

(914)

9,652
66,970(29,681)
24,76544,031

12,102

22,93912,662

Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
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 of parent
Comprehensive income attributable to non-controllinginterests9(3) Consolidated Statements of Changes in Equity
For the Fiscal Year ended December 31, 2017 (From January 1, 2017 to December 31, 2017)(Million Yen)
Shareholder’s equity
Capitalstock
Balance at beginning ofcurrent period
Changes of items during
periodCapitalsurplus78,862Retainedearnings

63,451Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
sharesChange in ownershipinterest of parent due totransactions with noncontrolling interests
Net changes of items otherthan shareholders’ equity
Total changes of items
during period
Balance at end of current
periodTotal
shareholders’equityTreasuryshares361,074(6,444)496,944(12,828)(12,828)

37,12337,123
(10)

(10)

0

1

0

(190)

(190)

－

(189)

24,295(9)

24,09578,862

63,262

385,369(6,454)

521,040

Accumulated other comprehensive income
Total
Valuation
Foreign currency Remeasureaccumulated Share acquisition Non-controlling
difference onrightsinterests
translation
ments of defined
otheravailableadjustment
benefit planscomprehensive
for-sale securities
incomeBalance at beginning ofcurrent period
Changes of items during
period10,120(28,512)(5,214)(23,606)85

112,334

Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
sharesChange in ownershipinterest of parent due totransactions with noncontrolling interests
Net changes of items otherthan shareholders’ equity
Total changes of items
during period
Balance at end of current
periodTotal
net assets

585,757(12,828)
37,123
(10)
1

(190)

1,948

3,125

1,829

6,903

51

12,59919,554

1,948

3,125

1,829

6,903

51

12,59943,65012,068(25,387)(3,384)(16,703)

136

124,934

629,40810

For the Fiscal Year ended December 31, 2018 (From January 1, 2018 to December 31, 2018)(Million Yen)
Shareholder’s equity
Capitalstock
Balance at beginning ofcurrent period
Changes of items during
periodCapitalsurplus78,862

63,262

Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
sharesChange in ownershipinterest of parent due totransactions with noncontrolling interests
Net changes of items otherthan shareholders’ equity
Total changes of items
during period
Balance at end of current
periodRetainedearnings

Total
shareholders’equityTreasuryshares385,369(6,454)

521,040(14,110)(14,110)

34,19534,195

18

(7)

(7)

16

35

(33)

(33)

－

(15)

20,084

9

20,07978,862

63,247405,454(6,444)541,119

Accumulated other comprehensive income
Total
Valuation
Foreign currency Remeasureaccumulated Share acquisition Non-controlling
difference onrightsinterests
translation
ments of defined
otheravailableadjustment
benefit planscomprehensive
for-sale securities
incomeBalance at beginning ofcurrent period
Changes of items during
period12,068(25,387)(3,384)(16,703)

136

124,934

Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
sharesChange in ownershipinterest of parent due totransactions with noncontrolling interests
Net changes of items otherthan shareholders’ equity
Total changes of items
during period
Balance at end of current
periodTotal
net assets

629,408(14,110)
34,195
(7)
35

(33)

(4,680)(16,275)(1,136)(22,093)

19

1,353

(20,720)(4,680)(16,275)(1,136)(22,093)

19

1,353

(640)

7,388

(41,663)(4,521)(38,796)156

126,288628,76711

(4) Consolidated Statements of Cash Flows(Million yen)
For the fiscal year ended
December 31, 2017
Cash flows from operating activities
Profit before income taxes
Depreciation
Amortization of goodwill
Interest and dividend income
Interest expenses
Share of loss (profit) of entities accounted for using equity
methodLoss (gain) on sales and retirement of property, plant andequipment
Decrease (increase) in notes and accounts receivable - trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable - trade
Increase (decrease) in net defined benefit liability
Other, net
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes paid
Income taxes refund
Net cash provided by (used in) operating activities
Cash flows from investing activities
Net decrease (increase) in short-term investment securities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of investment securities
Payments into time deposits
Purchase of shares of subsidiaries resulting in change inscope of consolidation
Other, net
Net cash provided by (used in) investing activities
Cash flows from financing activities
Net increase (decrease) in short-term loans payable
Proceeds from long-term loans payable
Repayments of long-term loans payable
Repayments of lease obligations
Cash dividends paid
Dividends paid to non-controlling interests
Redemption of bonds
Proceeds from share issuance to non-controllingshareholders
Other, net
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

12

For the fiscal year ended
December 31, 2018

74,771
17,831
11,616(2,112)
1,081

77,163
18,476
12,061(2,506)
1,260(1,217)(1,250)505(4,957)(13,655)(4,850)
5,551
471
7,395
97,3883,017(1,094)(24,168)
4,122
79,265(8,996)
1,079(1,024)(296)(9,288)81,7203,400(1,347)(25,043)447
59,177

13,089(20,727)
1,484(8,394)(6,211)

12,456(18,377)
6,198(62)(37,021)(82,606)(1,868)2,685(100,680)

1,319(37,355)(12,917)35,360(3,764)(567)(12,828)(14,180)(2,558)24,712
16,995(7,076)(607)(14,110)(12,038)
-

-

689

22
(11,434)(1,106)(33,955)
134,515
100,560

67
8,632(2,569)27,883
100,560
128,444(5) Notes to Consolidated Financial Statements(Notes on going concern assumption)
There is no relevant information.
(Changes in methods of presentation)(Consolidated Statements of Cash Flows)“Payments into time deposits,” which was included in “other” under “cash flows from investing activities”
during the previous fiscal year, has become significant in value, and is separately presented from the fiscal year
ended December 31, 2018. To reflect this change, the consolidated financial statements for the previous fiscal
year have been rearranged.
As a result, “other” of ¥(3,526) million, which was presented in “cash flows from investing activities” on
the consolidated statements of cash flows during the previous fiscal year, has been rearranged to “payments into
time deposits” of ¥(6,211) million and “other” of ¥2,685 million.

13

(Segment information)
1. Summary of reportable segments
The reportable segments of the Company categorize the business composition of the Company for which
separate financial information is available and are subject to periodical evaluation by the Board of Directors inorder to make decisions regarding management resource allocation and performance assessment.
The Group’s primary business is the manufacture and sale of paint for automotive, general, industrial, andother uses, and fine chemicals. The Company and separate local companies are responsible for domestic activities,
and overseas, separate local companies are responsible for the Asia, Americas and other regions.
Each company is an individual management unit, and concerning which items to carry, comprehensive
strategic proposals are made for each region to foster business growth.
As a result, the Group consists of segments divided by region with manufacture and sales structure as a base,and the three reportable segments are “Japan,” “Asia,” and “Americas.”2. Calculation methods for net sales, profit and loss, assets, liabilities, and other items by reportable segment
Accounting treatment methods for reportable segments comply with the accounting principles andprocedures adopted for preparing consolidated financial statements.
Profits for reportable segments are figures based on operating profit. Inter-segment net sales or transfers are
based on actual market prices.
3. Information on net sales, income (loss), assets, liabilities, and other figures by reportable segment
Previous fiscal year (January 1, 2017 – December 31, 2017)(Million yen)

Reportable segment
Japan

Asia

Americas

Subtotal

Other(Note 1)Total

Net sales to outside customers

175,907347,033

68,229591,170

14,082605,252

Inter-segment net sales or transfers

33,6174,665

162

38,446934

39,381

209,525

351,699

68,392

629,616

15,016644,633

Segment income

43,17240,826

3,170

87,169248

87,417

Segment assets

588,591

537,363

Net sales

Total

123,222 1,249,177

15,285 1,264,462

Other items
Depreciation
3,379
11,634
2,618
17,632
198
17,831
Increase in property, plant, and
6,469
22,19453,46882,131
872
83,004equipment and intangible assets
Note 1: “Other” represents business segments that are not included in the reportable segments, and contains
business activities by overseas subsidiaries in Europe, etc.
Note 2: The increases in “segment assets” and “increase in property, plant, and equipment and intangible assets”
in the “Americas” segment are primarily due to the consolidation of DUNN-EDWARDSCORPORATION.

14

Fiscal year ended December 31, 2018 (January 1, 2018 – December 31, 2018)(Million yen)

Reportable segment
Japan

Asia

Americas

Subtotal

Other(Note)Total

Net sales to outside customers

178,133

355,746

75,207

609,087

13,900622,987

Inter-segment net sales or transfers

34,9113,480

217

38,609738

39,348

Total

213,045359,226

75,424

647,696

14,638662,335

Segment income (loss)

41,621

36,066

3,080

80,768(677)

80,091

Segment assets

585,617555,785

119,807

1,261,210

Net sales

15,738 1,276,949

Other items
Depreciation
3,547
11,861
2,850
18,260216
18,476
Increase in property, plant, and
3,963
14,026
2,608
20,597
2,725
23,323equipment and intangible assets
Note: “Other” represents business segments that are not included in the reportable segments, and contains
business activities by overseas subsidiaries in Europe, etc.
4. Difference between total amount for reportable segment and the amount recorded in the consolidated financial
statements, and major details of such difference (matters related to adjustments of difference)
Net sales

For the fiscal year ended
December 31, 2017

(Million yen)
For the fiscal year ended
December 31, 2018

Total reportable segment sales

629,616

647,696

Net sales from “Other”

15,016

14,638Inter-segment transaction eliminations and other(39,381)(39,348)
adjustments
Net sales recorded in the consolidated financial
605,252
622,987
statements
Note: “Inter-segment transaction eliminations and other adjustments” includes inter-segment dividend income.

IncomeFor the fiscal year ended
December 31, 2017

(Million yen)
For the fiscal year ended
December 31, 201887,16980,768248(677)

Total reportable segment income
Segment income (loss) from “Other”

Inter-segment transaction eliminations and other(12,459)(13,860)
adjustments
Operating profit recorded in the consolidated
74,957
66,231
financial statements
Note: “Inter-segment transaction eliminations and other adjustments” includes inter-segment dividend income.

15

(Million yen)Segment assets

As of December 31, 2017 As of December 31, 2018

Total reportable segment assets
Net assets from “Other”
Inter-segment transaction eliminations and otheradjustments
Total company assets (Note)

1,249,177

1,261,210

15,285

15,738(420,696)(424,311)

76,82583,392

Net assets recorded in the consolidated financial
920,591
936,030
statements
Note: Total company assets consist of surplus operating funds (cash and deposits), long-term investment funds(investment securities), and deferred tax assets.
(Million yen)
Other items

Total of reportable
Consolidated financial
Other, net
Adjustment
segments
statements total
Previous
Current
Previous
Current
Previous
Current
Previous
Current
consolidated consolidated consolidated consolidated consolidated consolidated consolidated consolidated
fiscal year
fiscal year
fiscal year
fiscal year
fiscal year
fiscal year
fiscal year
fiscal year

Depreciation

17,632

18,260

198

216

－

－

17,831

18,476

Increase in property, plantand equipment andintangible assets

82,131

20,597

872

2,725

－

－

83,00423,32316

(Per-share information)
Previous consolidated
Current consolidated
fiscal year
fiscal year
(From January 1, 2017 (From January 1, 2018
To December 31, 2017) To December 31, 2018
¥1,572.60¥1,566.27

Net assets per share
Basic earnings per share¥115.76¥106.63

Diluted earnings per share¥115.74¥106.61(Note) The basis of calculations of basic earnings per share and diluted earnings per share are as below.
Previous consolidated
Current consolidated
fiscal year
fiscal year
(From January 1, 2017 (From January 1, 2018
To December 31, 2017) To December 31, 2018
Basic earnings per share
Profit attributable to owners of parent (million yen)Amount not attributable to common shareholders(million yen)
Profit attributable to owners of parent relating tocommon shares (million yen)
Average number of shares during the period(thousands of shares)
Diluted earnings per share
Adjusted profit attributable to owners of parent(million yen)
Increase in the number of shares of common stock(thousands of shares)(Subscription rights to shares included in the above)(thousands of shares)
Descriptions of potential shares that were notincluded in the computation of diluted earnings per
share because of their anti-dilutive effect(Significant subsequent events)
There is no relevant information.

17

37,12334,195－－37,12334,195

320,702

320,704

－

－

49

50

(49)

(50)
－

4. Other(1) State of Sales Performance(Million yen)Previous consolidated
fiscal year
(From January 1, 2017
To December 31, 2017)

Current consolidated
fiscal year
(From January 1, 2018
To December 31, 2018)

Compared with previous
fiscal year(%)

586,373603,597

2.9

Automotive paint148,437

159,610

7.5

Trade-use paint308,846

318,264

3.0

Industrial paint73,04568,870(5.7)

Other paint56,04356,852

1.4

Fine chemical business

18,87919,3902.7

Total

605,252

622,987

2.9

Paint businessNote: Consumption taxes are not included in these amounts.

18