Consolidated Financial Results
for the Fiscal Year Ended December 31, 2020
[IFRS]
February 10, 2021
Company name: NIPPON PAINT HOLDINGS CO., LTD.
Stock exchange listing: Tokyo Stock Exchange
Code number: 4612
URL: https://www.nipponpaint-holdings.com/
Representative: Masaaki Tanaka, Chairman of the Board, Representative Executive Officer, President & CEO
Contact: Ryosuke Tanaka, General Manager of Investor Relations
Phone: +81-50-3131-7419
Scheduled date of annual general meeting of shareholders: March 26, 2021
Scheduled date of commencing dividend payments: March 29, 2021
Scheduled date of filing the securities report: March 29, 2021
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, 2020 (January 1, 2020 to
December 31, 2020)(1) Consolidated Operating Results(% indicates changes from the previous corresponding period.)
Revenue
Operating profit
Profit before tax
ProfitFiscal year ended
Million yen%
Million yen%
Million yen%
Million yen%
781,146
12.9
86,933
11.4
88,715
11.6
68,17521.2
December 31, 2020
December 31, 2019
692,009
10.3
78,060(9.8)
79,518 (10.7)
56,267 (15.2)

Fiscal year ended
December 31, 2020
December 31, 2019

Profit attributable toowners of parent

Comprehensive
incomeMillion yen%

Million yen%

44,64836,71721.6(19.0)

51,07032,664

56.3(9.5)

Basic earnings
per share

Diluted earnings
per share

Return on
equityProfit before tax
to total assets

Fiscal year ended
Yen
Yen
%
139.17139.148.0
December 31, 2020
December 31, 2019114.48114.45
6.8
Reference: Share of profit of investments accounted for using equity method:
Fiscal year ended December 31, 2020: ¥1,649 million
Fiscal year ended December 31, 2019: ¥1,438 million

Operating profit
to revenue

%

%

5.7
6.5

11.1
11.3

(2) Consolidated Financial Position

Total assets

As of December 31, 2020
As of December 31, 2019

Total equity

Equityattributable toowners ofparentEquityattributable toowners ofparent to total
assetsEquity per
share
attributable toowners ofparentMillion yen

Million yen

Million yen%

Yen

1,615,384
1,478,646

699,805
687,979

568,398
552,92235.2
37.4

1,771.49
1,723.75

(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

88,561
92,076(36,368)(352,769)

60,869254,018

232,134
123,300

Fiscal year ended
December 31, 2020
December 31, 2019
2. Dividends

Annual dividends

Fiscal year ended
December 31, 2019
December 31, 2020
December 31, 2021
(forecast)

3rd
quarter- Year-end
end

Consolidated
Consolidated dividend on
Total
dividend
equitydividends
payoutattributable
paid
ratio
to owners ofparentMillion yen%%

1stquarter-end

2ndquarterend

Yen

Yen

Yen

Yen

Yen

－

22.00

－

23.00

45.00

14,435

39.3

2.7

－

22.00

－

23.00

45.00

14,439

32.3

2.6

－

5.00

－

5.00

10.00

Total

35.1

Note 1: The Company’s Board of Directors approved a resolution on February 10, 2021 to implement a stock split in which each shareof common stock held by shareholders as of the record date of March 31, 2021 will be split into five shares. The per share dividend
for the fiscal year ended December 31, 2019 and the fiscal year ended December 31, 2020 is the dividend before the stock split.
The dividend forecast for the fiscal year ending December 31, 2021 is the per share dividend forecast based on the number ofshares after the stock split. For more information, please see the “Notice Regarding Stock Split and Associated Amendment to
the Articles of Incorporation” dated February 10, 2021.
Note 2: Breakdown of the dividend forecast for the 2nd quarter of the fiscal year ending December 31, 2021: ordinary dividend: ¥4.00
yen; commemorative dividend: ¥1.00 for the 140th anniversary of foundation

3. Consolidated Financial Results Forecast for the Fiscal Year Ending December 31, 2021 (January 1, 2021 to
December 31, 2021)(% indicates changes from the previous corresponding period)
Profit attributable to
Basic earnings
Revenue
Operating profit
Profit before tax
owners of parent
per share
Million yen% Million yen% Million yen% Million yen%
Yen
Full year
890,000
13.9
87,0000.1
88,000(0.8)
67,00050.1
29.17
Note 1: Third-party allotment for value: The Company issued new shares through a third-party allotment on January 25, 2021. As aresult, the total number of issued shares increased by 148,700,000 to 474,102,443 shares.
Note 2: Basic earnings per share takes into consideration the third-party allotment for value and the stock split described in footnote,“2. Dividends.”

* Notes:(1) Changes in significant subsidiaries during the period under review: No(Changes in specified subsidiaries resulting in changes in the scope of consolidation)
Newly consolidated - Excluded(2) Changes in accounting policies and changes in accounting estimates
1) Changes in accounting policies required by IFRS: No
2) Changes in accounting policies other than 1) above: No
3) Changes in accounting estimates: Yes(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, 2020: 325,402,443 shares
December 31, 2019: 325,402,443 shares2) Total number of treasury shares at the end of the period:
December 31, 2020: 4,543,825 shares
December 31, 2019: 4,635,484 shares
3) Average number of shares during the period:
Fiscal year ended December 31, 2020: 320,810,818 sharesFiscal year ended December 31, 2019: 320,732,869 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 contain risks and uncertainties. Actual results, etc. may differ greatly from the forecast figuresdepending on various factors.

Table of Contents
1. Overview of Operating Results ....................................................................................................... 2(1) Overview of Operating 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 ................................................................. 3(4) Future Outlook ............................................................................................................................ 4
2. Basic Approach to Selection of Accounting Standards ..................................................................... 4
3. Consolidated Financial Statements and Primary Notes .................................................................... 5(1) Consolidated Statements of Profit or Loss and Comprehensive Income ....................................... 5(2) Consolidated Statement of Financial Position .............................................................................. 7(3) Consolidated Statement of Changes in Equity ............................................................................. 9(4) Consolidated Statement of Cash Flows ...................................................................................... 10(5) Notes to Consolidated Financial Statements ............................................................................... 11(Notes on going concern assumption) .................................................................................... 11(Changes in presentation) ...................................................................................................... 11(Changes in accounting estimates) ......................................................................................... 11(Segment information) .......................................................................................................... 11(Per-share information) ......................................................................................................... 15(Significant subsequent events) ............................................................................................ 16

1

1. Overview of Operating Results(1) Overview of Operating Results for the Period under Review
During the fiscal year ended December 31, 2020, consolidated revenue of the Company and its groupcompanies (collectively, the “Group”) increased by 12.9% from the previous fiscal year to ¥781,146 million due
to the consolidation of Australian paint manufacturer DuluxGroup Limited and Turkish paint manufacturer Betek
Boya ve Kimya Sanayi Anonim Sirketi into the Company’s subsidiaries and the strong sales of decorative paints
in China, our mainstay business in Asia, due to the recovery of the Chinese economy, despite the impact of
COVID-19 pandemic on all Group businesses. Consolidated operating profit increased by 11.4% from theprevious fiscal year to ¥86,933 million due to higher revenue and lower raw material procurement costs, despite
the absence of insurance income recorded in the previous fiscal year.
Consolidated profit before tax increased by 11.6% to ¥88,715 million, and profit attributable to owners ofparent increased by 21.6% to ¥44,648 million.
*DuluxGroup Limited is an Australian company that owns the Dulux® trademark in Australia, New Zealand,
Papua New Guinea, Samoa and Fiji only. DuluxGroup Limited is not associated with, and has no connection to,
the owners of the Dulux® trademark in any other countries, nor does it sell Dulux® products in any othercountries.
Results by business segment are as follows.
Japan
In this region, automotive coatings revenue was lower than in the previous fiscal year as a result of a decreasein automobile production due to COVID-19. Industrial coatings revenue was lower than in the previous fiscal
year due to factors such as continued production cuts due to COVID-19 and weak market conditions accompanied
by fewer new housing starts. Decorative paints revenue was lower than in the previous fiscal year due to COVID19.
As a result, consolidated revenue for the Japan segment decreased by 12.6% to ¥159,625 million.
Consolidated operating profit decreased by 10.1% to ¥33,251 million. Consolidated operating profit included¥26,079 million of dividend income from overseas group companies (¥13,585 million in the previous fiscal year.)
All of this dividend income is eliminated as an internal transaction under “intersegment eliminations andadjustments.”
Asia
In this region, automotive coatings revenue was lower than in the previous fiscal year because of soft market
conditions including a decrease in the number of automobile production in Thailand due to the COVID-19
pandemic. For decorative paints, the mainstay business in Asia, revenue increased due to a strong recovery indemand for new housing construction and repainting existing houses in China. This increase in demand morethan offset the impact of COVID-19 pandemic during the first six months of the fiscal year under review.
As a result, consolidated revenue for the Asia segment decreased by 0.7% to ¥356,609 million andconsolidated operating profit increased by 8.2% to ¥54,957 million.
Oceania
In this region, the profit and/or loss of DuluxGroup Limited has been reflected in the Group’s consolidated
financial results since September 2019. The performance in the decorative paints business remained strong,
driven by consistently strong demand brought by enhanced home improvement activity resulted from the
COVID-19 pandemic. Performance in the paint related business was robust due to strong home improvement
demand.
As a result, consolidated revenue in the Oceania segment increased by 211.7% to ¥148,290 million, andconsolidated operating profit increased by175.0% to ¥16,118 million.
2

Americas
In this region, there was a decline in automotive coatings revenue because of decreased production of
automobiles in the United States, a core region, due to the COVID-19 pandemic. Decorative paints revenue
increased due to the brisk demand for housing accompanied by favorable weather.
As a result, consolidated revenue for the Americas segment decreased by 6.1% to ¥70,068 million andconsolidated operating profit decreased by 10.0% to ¥4,507 million.
Other
In this segment, the profit and/or loss of Betek Boya ve Kimya Sanayi Anonim Sirketi has been reflected in
the Group’s consolidated financial results since July 2019. Automotive coatings revenue decreased from theprevious fiscal year due to a sharp decrease in the production of automobiles in this region as a result of the
COVID-19 pandemic. On the other hand, revenue for decorative paints and paint related businesses increased,
driven by growth in housing starts and sales of existing houses in Turkey.
As a result, consolidated revenue for the Other segment increased by 66.2% to ¥46,552 million andconsolidated operating profit was ¥4,209 million (an operating loss of ¥6,972 million in the previous fiscal year).

(2) Overview of Financial Position for the Period under Review
Total assets as of December 31, 2020 increased by ¥136,737 million from the end of the previous fiscal yearto ¥1,615,384 million.
Current assets increased by ¥136,280 million mainly due to an increase in cash and cash equivalents
resulting from the acquisition of 100% ownership of the Asian JVs and Indonesia business. Non-current assets
increased by ¥457 million despite a decrease in other financial assets mainly because of an increase in property,
plant and equipment.
Liabilities increased by ¥124,911 million to ¥915,578 million mainly due to an increase in bonds andborrowings.
Equity increased by ¥11,826 million to ¥699,805 million. This was mainly attributable to a decrease inforeign currency translation adjustment and an increase in retained earnings due to profit attributable to ownersof parent.
As a result, equity attributable to owners of parent to total assets decreased from 37.4% at the end of theprevious fiscal year to 35.2%.
(3) Overview of Cash Flows for the Period under Review
In the fiscal year ended December 31, 2020, operating activities resulted in an inflow of ¥88,561 million,
investing activities resulted in an outflow of ¥36,368 million, and financing activities resulted in an inflow of¥60,869 million, resulting in cash and cash equivalents of ¥232,134 million, an increase of ¥108,833 million
compared with the end of the previous fiscal year.
(Cash flows from operating activities)
Net cash provided by operating activities decreased by ¥3,514 million from the previous fiscal year to¥88,561 million. Primary factors include a decrease in funds of ¥1,605 million due to an increase in operating
capital and income taxes paid of ¥26,682 million, despite a cash inflow (excluding increases and decreases inoperating capital) of ¥131,249 million, reflecting mainly non-cash expenses such as depreciation andamortization on profit before tax.
(Cash flows from investing activities)
Net cash used in investing activities decreased by ¥316,400 million from the previous fiscal year to¥36,368 million. This was mainly attributable to an inflow of ¥6,942 million due to a decrease in time deposits,
an outflow of ¥25,214 million due to the purchase of property, plant, and equipment, an outflow of ¥6,284 million
3due to an increase in marketable securities, and an outflow of ¥3,641 million due to payments for acquisition ofbusinesses.

(Cash flows from financing activities)
Net cash provided by financing activities decreased by ¥193,149 million from the previous fiscal year to¥60,869 million. Primary factors include an inflow of ¥95,861 million due to an increase in borrowings, anoutflow of ¥27,249 million due to dividends paid and an outflow of ¥7,405 million due to repayments of leaseliabilities.

(4) Future Outlook
During the fiscal year ending December 31, 2021, the economic outlook is expected to remain uncertain due
to the resurgence of COVID-19 around the world. However, the global economy is projected to return to growth
due to factors including vaccinations and more rigorous infection prevention measures.
The Group integrated its automotive coatings operations globally in order to provide products and services
that more accurately meet the requirements of customers and expand the automotive coatings business in Japanand overseas. In addition, we completed the acquisition of 100% ownership of the Asian JVs and the Indonesia
business on January 25, 2021 to accelerate the implementation of our strategic management initiatives.
Furthermore, the Group companies in Japan and overseas are using seamless collaboration through spider web
management and pursuing autonomous growth to gain market share in their respective business fields.
Our consolidated earnings forecast for the fiscal year ending December 31, 2021 takes into account thisoutlook. We forecast consolidated revenue of ¥890,000 million, consolidated operating profit of ¥87,000 million,
profit before tax of ¥88,000 million and profit attributable to owners of the parent of ¥67,000 million.
Based on this earnings forecast, we plan to pay the annual dividends of ¥10 per share for the fiscal year
ending December 31, 2021.

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 among group companies, the Group has been
voluntarily adopted International Financial Reporting Standards (IFRS) for consolidated financial statements in
its annual securities reports since the fiscal year ended December 31, 2018.

4

3. Consolidated Financial Statements and Primary Notes(1) Consolidated Statements of Profit or Loss and Comprehensive Income
Consolidated Statement of Profit or Loss
(Million yen)
For the fiscal year ended
December 31, 2019
Revenue
Cost of sales
Gross profit
Selling, general and administrative expenses
Other income
Other expenses
Operating profit
Finance income
Finance costs
Share of profit of investments accounted forusing equity method
Profit before tax
Income tax expense
ProfitProfit attributable to
Owners of parent
Non-controlling interests
ProfitEarnings per share
Basic earnings per share (yen)Diluted earnings per share (yen)5

For the fiscal year ended
December 31, 2020

692,009(416,359)
275,649(190,435)
6,717(13,871)
78,0605,749(5,729)781,146(457,685)

1,438

1,649

79,518(23,251)
56,26788,715(20,539)
68,17536,717
19,55056,26744,64823,526
68,175114.48114.45139.17139.14323,460(238,319)
5,495(3,703)86,9336,129(5,996)

Consolidated Statement of Comprehensive Income(Million yen)
For the fiscal year ended
December 31, 2019
ProfitOther comprehensive income
Items that will not be reclassified to profit or loss
Net change in fair value of equity instruments
designated as measured at fair value through othercomprehensive income
Remeasurements of defined benefit plans
Share of other comprehensive income of investments
accounted for using the equity methods
Total of items that will not be reclassified to profit orloss
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign
operations
Cash flow hedges
Share of other comprehensive income of investments
accounted for using equity method
Total of items that may be reclassified to profit or loss
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to
Owners of parent
Non-controlling interests
Comprehensive income

6

For the fiscal year ended
December 31, 2020

56,267

68,175

3,229(2,406)

(828)

1,907

－

387

2,400

(111)

7,080

(16,578)(32,737)

(38)

(346)

(376)

(26,003)(23,602)32,664(16,992)(17,104)
51,07014,92917,73532,664

29,414
21,65551,070(2) Consolidated Statement of Financial Position
As ofDecember 31, 2019
AssetsCurrent assets
Cash and cash equivalents
Inventories
Trade and other receivables
Other financial assets
Other current assets
Subtotal
Assets held for sale
Total current assets
Non-current assets
Property, plant and equipment
Goodwill
Other intangible assets
Investments accounted for using equity method
Other financial assets
Other non-current assets
Deferred tax assets
Total non-current assets
Total assets

7(Million yen)
As ofDecember 31, 2020

123,300
92,860212,844
65,158
12,623506,787428
507,216

232,134
94,055
231,995
66,915
17,468642,569927
643,496240,319427,091
230,986
12,68054,381
2,818
3,151
971,430
1,478,646

248,302424,168
230,099
13,17449,9393,124
3,078
971,887
1,615,384

As ofDecember 31, 2019

(Million yen)
As ofDecember 31, 2020

Liabilities and equity
Liabilities
Current liabilities
Trade and other payables
Bonds and borrowings
Other financial liabilities
Income taxes payable
Provisions
Other current liabilities
Total current liabilities
Non-current liabilities
Bonds and borrowings
Other financial liabilities
Retirement benefit liability
Provisions
Other non-current liabilities
Deferred tax liabilities
Total non-current liabilities
Total liabilities
EquityShare capital
Capital surplus
Treasury shares
Retained earnings
Other components of equity
Total equity attributable to owners of parent
Non-controlling interests
Total equity
Total liabilities and equity

8

153,277
384,049
12,4706,739
2,197
39,413598,147

161,525
68,13325,534
8,796
2,945
48,611
315,547

58,14744,681
24,382900
1,847
62,560
192,519790,667

467,627
46,917
20,763775
4,344
59,602600,030
915,578

78,862
62,927(6,378)411,941
5,568
552,922
135,056
687,979
1,478,646

78,862
63,320(6,268)444,639(12,156)
568,398
131,407699,805
1,615,384－

(3) Consolidated Statement of Changes in Equity(Million yen)
Equity attributable to owners of parent

Share capital

Balance as of January 1, 2019

CapitalsurplusTreasurysharesRetainedearnings

Other
components ofequityNoncontrollinginterests

Total

Total

78,862

63,247(6,444)

390,287(5,905)520,047

127,570647,618

Profit－－－36,717－36,717

19,55056,267

Other comprehensive income

－

－

－

－

(21,787)(21,787)(1,815)(23,602)

Comprehensive income

－

－

－

36,717(21,787)

14,92917,73532,664Purchase of treasury shares

－

－

(11)

－

－

(11)

－

(11)

Disposal of treasury shares

－

162

77

－

(5)

234

－

234

Dividends－－－(14,433)－(14,433)(12,047)(26,481)

Share-based payment transactions

－

－

－

－

10

10

－

10

Changes in ownership interest in
subsidiaries

－

(481)

－

－

－

(481)

(441)

(922)

Change in scope of consolidation

－

－

－

－

－

－

493

493

Transfer from other componentsof equity to retained earnings
Transfer from other componentsof equity to non-financial assets
Capital increase of consolidated
subsidiaries

－

－

－

(629)

629

－

－

－

－

－

－

－

32,62632,626－32,626

－

－

－

－

－

－

1,793

1,793

Other

－

－

－

－

－

－

(47)

(47)

Total transactions with owners

－

(319)

66

(15,063)

33,261

17,945(10,249)

7,695

Balance as of December 31, 201978,862

62,927(6,378)411,941

5,568

552,922

135,056

687,979

Profit－－－44,648－44,64823,526

68,175

Other comprehensive income

－

－

－

－

(15,233)(15,233)(1,871)(17,104)

Comprehensive income

－

－

－

44,648(15,233)

29,414

21,65551,070Purchase of treasury shares

－

－

(19)

－

－

(19)

－

(19)

Disposal of treasury shares

－

392

129

－

(4)

517

－

517

Dividends－－－(14,437)－(14,437)(25,009)(39,446)

Share-based payment transactions

－

－

－

－

－

－

－

－

Changes in ownership interest in
subsidiaries

－

－

－

－

－

－

(552)

(552)

Change in scope of consolidation

－

－

－

－

－

－

(82)

(82)

Transfer from other componentsof equity to retained earnings

－

－

－

2,487

(2,487)－－－

Transfer from other componentsof equity to non-financial assets

－

－

－

－

－

－

－

－

Capital increase of consolidated
subsidiaries

－

－

－

－

－

－

343

343

Other

－

－

－

－

－

－

(3)

(3)

Total transactions with owners

－

392

109

(11,950)(2,491)(13,939)(25,304)(39,243)

Balance as of December 31, 2020

78,862

63,320(6,268)444,639(12,156)

568,398

131,407699,8059

(4) Consolidated Statement of Cash Flows(Million yen)
For the fiscal year ended
December 31, 2019

For the fiscal year ended
December 31, 2020

79,51825,76911,315(4,640)
4,782

88,71529,521272(4,514)
5,663(1,438)(1,649)

(918)

667

(2,306)
(586)
4,706
(820)
(834)
2,237
(2,200)114,583
2,543
2,095(4,297)(22,849)
92,076(2,939)(25,454)
12,389
(755)
816
9,876
2,393
115,001
2,825
3,141(5,724)(26,682)
88,561(4,518)(1,167)(22,764)
4,205(2,679)(318,655)(57)(2,622)(3,612)

6,942(6,284)(25,214)1,440(3,547)(1,934)

Cash flows from operating activities
Profit before tax
Depreciation and amortization
Impairment loss
Interest and dividend income
Interest expenses
Share of loss (profit) of investments accounted for using
equity method
Loss (gain) on sale and retirement of property, plant andequipment, and intangible assets
Decrease (increase) in inventories
Decrease (increase) in trade and other receivables
Increase (decrease) in trade and other payables
Increase (decrease) in retirement benefit liability
Increase (decrease) in provisions
Increase (decrease) in other current liabilities
Other
SubtotalInterest received
Dividends received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Net decrease (increase) in time deposits
Net decrease (increase) in marketable securities
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
Purchase of intangible assets
Purchase of investments in subsidiaries
Payments for sale of investments in subsidiaries
Payments for acquisition of businesses
Payments for loans receivableCollection of loans receivable
Purchase of other financial assets
Other
Net cash provided by (used in) investing activities(896)(352,769)

301,178
7,054(21,209)(8,133)
1,881(14,433)(12,310)(8)
254,018(359,863)
472,306(16,581)(7,405)343(14,439)(12,810)(680)
60,869341(4,228)(6,333)
129,633
123,300

108,833
123,300
232,134－－

Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Proceeds from long-term borrowings
Repayments of long-term borrowings
Repayments of lease obligations
Capital contribution from non-controlling interests
Dividends paid
Dividends paid to non-controlling interests
Other
Net cash provided by (used in) financing activities
Effect of exchange rate changes 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

10－(3,641)(3,602)176(1,558)855(36,368)(5) Notes to Consolidated Financial Statements(Notes on going concern assumption)
There is no relevant information.
(Changes in presentation)(Consolidated statement of cash flows)“Increase (decrease) in other current liabilities,” which was included in “Other” under “Cash flows fromoperating activities” in the previous fiscal year, has become significant, and is separately presented from the fiscal
year ended December 31, 2020. To reflect this change, the consolidated financial statements for the previous
fiscal year have been revised.
As a result, “Other” of ¥36 million, which was included in “Cash flows from operating activities” in the
consolidated statement of cash flows for the previous fiscal year, has been restated as “Increase (decrease) inother current liabilities” of ¥2,237 million and “Other” of negative ¥2,200 million.
“Purchase of investment securities” of negative ¥237 million, which was separately presented in “Cash flows
from operating activities” on the consolidated statement of cash flows during the previous fiscal year, has been
included in “Other” of negative ¥896 million.
(Changes in accounting estimates)
Trademark rights (other intangible assets) of NIPPON PAINT (H.K.) COMPANY LIMITED, etc., that wererecognized when these companies became consolidated subsidiaries of the Company in December 2014, had beenamortized with estimated useful life of 20 years. However, we have reexamined the amortization period of these
trademark rights by taking into consideration the consistently strong brand recognition of these trademark rights
and other factors. As a result, the estimated useful life of the trademark rights was changed to an indefinite usefullife at the beginning of the fiscal year ended December 31, 2020.
As a result of this change, amortization of trademark rights (selling, general and administrative expenses)
decreased ¥2,256 million in the condensed consolidated statement of profit or loss for the fiscal year ended
December 31, 2020.
The change has affected the results of operations for the Asia segment(Segment information)(1) Summary of reportable segments
The reportable segments of the Group are based on business units for which separate financial information isavailable and are subject to periodic evaluations by the Board of Directors, which is the highest decision-making
body, in order to make decisions regarding resource allocation and performance assessments. The Group’s primarybusinesses are the paint and coating business which manufactures and sells automotive coatings, decorative paints,
industrial coatings, fine chemicals, and other paints, and the paint peripheral business which manufactures and sells
paint-related products such as adhesives. The Company and other companies are responsible for activities in Japan,
and overseas, companies based in other countries are responsible for the Asia, Oceania, Americas, and Other
regions. Each company is an individual management unit that is responsible for determining products to
manufacture and sell and establishing comprehensive regional strategies for growth.
As a result, the Group consists of four reportable segments divided by region with the manufacturing and sales
structure as a base: Japan, Asia, Oceania, and Americas.
“Other” contains business activities by overseas subsidiaries in Europe and other regions. Those businessactivities are managed individually, but are not material enough to be disclosed separately as an independent
segment.

11

(2) Information on reportable segments
For the fiscal year ended December 31, 2019 (From January 1, 2019 to December 31, 2019)(Million yen)
Reportable segment
Other

Total

Adjustment(Note 1)

Consolidated
financialstatements

Japan

Asia

Oceania

Americas

Subtotal

182,585359,21347,57874,618663,996

28,012

692,009－

692,009

Intersegment revenue

34,028

4,051

－

142

38,221846

39,067(39,067)－

Total

216,614363,264

47,57874,760702,218

28,858731,077(39,067)

692,009

Segment profit (loss)

36,99050,769

5,861

5,010

98,632(6,972)91,659(13,599)

78,060

Revenue
Revenue fromexternal customers

Finance income

5,749

Finance costs
Share of profit ofinvestments accounted
for using equity
methodProfit before tax(5,729)1,438
79,518Other items
Depreciation and
4,284
13,491
2,169
4,617
24,562
1,207
25,769－amortization
Impairment loss
734
2,630
131
3,497
7,818
11,315－－
Capital expenditures
7,077
15,651
1,383
7,313
31,426
3,836
35,263－(Note 2)
Note 1: Adjustments to “intersegment revenue” and “segment profit (loss)” are primarily due to intersegment eliminations.
Note 2: These mainly consist of expenditures for property, plant and equipment and intangible assets.

12

25,76911,31535,263

For the fiscal year ended December 31, 2020 (From January 1, 2020 to December 31, 2020)(Million yen)
Reportable segment
Other

Total

Adjustment(Note 1)

Consolidated
financialstatements

Japan

Asia

Oceania

Americas

Subtotal

159,625

356,609148,290

70,068734,593

46,552

781,146－

781,146

Intersegment revenue

43,668

4,191

160

89

48,109722

48,832(48,832)－

Total

203,294360,800

148,450

70,158782,70347,274

829,978(48,832)

781,146

Segment profit (loss)

33,251

54,957

16,118

4,507

108,835

4,209

113,045(26,111)86,933

Revenue
Revenue fromexternal customers

Finance income

6,129

Finance costs
Share of profit ofinvestments accounted
for using equity
methodProfit before tax(5,996)
1,649
88,715

Other items
Depreciation and
4,789
12,142
6,777
4,674
28,384
1,137
29,521－amortization
Impairment loss
169
88
12
271
1
272
－
－
Capital expenditures
7,009
16,8996,783
5,536
36,2282,676
38,904－(Note 2)
Note 1: Adjustments to “intersegment revenue” and “segment profit (loss)” are primarily due to intersegment eliminations.
Note 2: These mainly consist of expenditures for property, plant and equipment and intangible assets.

13

29,521272
38,904

(3) Information on products and services
Sales categories by business have been changed to the “paint and coating business” and the “paint peripheralbusiness” in the fiscal year ended December 31, 2019.
Revenue for the previous fiscal year is presented based on the changed sales categories by business.
For the fiscal year ended December 31, 2019 (From January 1, 2019 to December 31, 2019)(Million yen)
Japan

Asia

Oceania

Americas

Other

Total

Paint and coating business

182,585359,213

26,582

74,61823,462

666,462

Automotive coatings

44,87967,070－25,915

11,777

149,643

Decorative paints

48,248

243,671

24,57745,3898,804

370,690

Industrial coatings

40,69025,643

2,004

－

1,832

70,170Fine chemicals

8,693

6,047

－

3,135

1,043

18,920

Other paints

40,074

16,779－177

457,036－－20,996－4,550

25,547

182,585359,21347,57874,61828,012

692,009

Paint peripheral business
Total

For the fiscal year ended December 31, 2020 (From January 1, 2020 to December 31, 2020)(Million yen)
Japan

Asia

Paint and coating business

159,625

356,609

Automotive coatings

34,685

Decorative paints

43,692

Industrial coatings

35,31724,444

Fine chemicals

7,713

5,384

Other paints

38,216

15,735

Paint peripheral business
Total

Oceania

Americas82,80370,06858,414－

252,629

77,124

Other

Total

35,344704,451

21,046

8,748

122,895

46,48020,977440,904

5,679

－

3,734

69,176

－

2,375

1,480

16,954

－

165

403

54,520－－65,487－

11,207

76,694

159,625

356,609148,290

70,06846,552

781,146

14

(Per-share information)
The basis of calculations of basic earnings per share and diluted earnings per share is as below.
For the fiscal year ended
December 31, 2019

For the fiscal year ended
December 31, 2020

36,71744,648－－

Diluted earnings (million yen)

36,71744,648Weighted-average number of common shares issued(thousands of shares)

320,732

320,81072

74

Increase due to exercise of stock options(thousands of shares)

52

50

Increase due to restricted share compensation
plan (thousands of shares)

20

23

Weighted-average number of common shares usedin the calculation of diluted earnings per share(thousands of shares)

320,805

320,885

Basic earnings per share (yen)114.48139.17

Diluted earnings per share (yen)114.45139.14

Profit attributable to owners of parent (million yen)
Adjustment to profit used in the calculation ofdiluted earnings per share (million yen)

Increase in the number of common shares used in
the calculation of diluted earnings per share(thousands of shares)

15

(Significant subsequent events)(Acquisition of additional equity interests in the joint ventures in the Asia region and acquisition of an equity
interest in the Indonesia business)
On January 25, 2021, the Company completed the acquisition of additional equity interests in its joint ventureswith the Wuthelam Group (WUTHELAM HOLDINGS LIMITED (“Wuthelam”) and its representative Mr. Goh
Hup Jin (Wuthelam and Mr. Goh Hup Jin collectively, “Wuthelam and Mr. Goh”; Wuthelam and Mr. Goh,
Wuthelam’s subsidiaries, and companies substantively controlled by Wuthelam and Mr. Goh, collectively, the“Wuthelam Group”) in the Asia region; acquisition of an equity interest in the Indonesia business (conversion to
subsidiary), which is operated by the Wuthelam Group and in which the Wuthelam Group owns 99.9% of theequity interests; pay-in procedures for issuance of new shares through a third-party allotment; and change inparent company.
The fair value of acquired assets and liabilities, etc. are not disclosed because the initial accounting treatment
for business combination has not been completed.
1. Summary of business combination(1) Main reasons for the business combination
The many applications of paint include residential and commercial construction, transport applications such ascars and trains, and infrastructure such as bridges and roads, meaning that demand for paint increases in step withpopulation growth and urbanization. Asia is becoming a key region for the Company’s sustainable growth interms of both market size and growth rate. The Company acquired approximately 100% ownership of the joint
ventures with the Wuthelam Group (“the Target JVs," collectively with the Indonesia business, the “Target
Businesses”) due to the outlook for increasing demand in Asia because of the projected demographic andeconomic growth in Asia. The Indonesia business operates in the growing Indonesian market and has a large
share of the decorative paints market, which has significant growth potential due to its correspondence topopulation and per-capita GDP growth. Acquiring the Indonesia business gives the Company a dominant position
with its “Asia x Construction” business model. Furthermore, by increasing its equity and enhancing its financial
soundness by issuing new shares through the third-party allotment to NIPSEA INTERNATIONAL LIMITEDand FRASER (HK) LIMITED, both members of the Wuthelam Group, the Company will be in an even better
position to use M&A for the maximization of shareholder value. This is expected to further accelerate theCompany’s growth.
The acquisition of the Target Businesses will also enable the Company to fully capture in the non-controllinginterests of the Asian JVs that previously belonged to the Wuthelam Group, as well as the profits of the Indonesia
business to be consolidated into the Company’s earnings. This is expected to increase basic earnings per share(EPS) and enable the Company to optimize the allocation of resources by reducing the outflow of profits.
Furthermore, the consolidation of the Asian JVs and Indonesia business will allow the Company to shift its
industrial coatings business from a regional focus to a business focus and construct a unified global system. This
will enable faster decision-making and business execution and is expected to increase operating profit. Therefore,
these acquisitions are expected to contribute to the maximization of the Company’s shareholder value.
(2) Cost of acquisitions
Total: ¥1,285,139 million (of which ¥235,490 million is for the acquisition of the equity interest in theIndonesia business)16

(3) Name and description of businesses of companies to be acquired①Major companies that will become subsidiaries or affiliated companies
Ownership ratio of voting rights
Company

Description of businessPrior toacquisition

Additional
acquisition

Afteracquisition

NIPSEA PTE. LTD. (Note 1)

Investment holding company

－%

100%

100%

Manufacture and sale of paint

50%

49.9%

99.9%

Management and operation ofsubsidiaries and paint trading

－%

100%

100%

Manufacture and sale of paint

12%

37%

49%

NIPPON PAINT (INDIA)
PRIVATE LIMITED (Note 1)
NEAVE LIMITED(Note 1 and Note 2)
NIPPON PAINT (SABAH)
SDN. BHD.

Note 1: Transaction falling under a business combination
Note 2: Company constituting the Indonesia business17

②Acquisition of the non-controlling interest
Major changes in non-controlling interests are as follows. The difference between the acquisition cost ofequity interests in consolidated subsidiaries which will continue to be controlled by the parent company and thecarrying value of non-controlling interests will be recognized as a decrease in capital surplus. When the capitalsurplus on the Consolidated Statement of Financial Position is negative, the negative balance of capital surplus
shall be zero and the negative balance shall be deducted from retained earnings.
Ownership ratio of voting rights(indirect ownership)Company

NIPPON PAINT (CHINA) COMPANY LIMITED (Note 1)

GUANGZHOU NIPPON PAINT CO., LTD. (Note 1)

NIPPON PAINT (CHENGDU) CO., LTD. (Note 1)

NIPPON PAINT (H.K.) COMPANY LIMITED (Note 1)

NIPPON PAINT MARINE CO., LTD. (Note 1)

NIPPON PAINT MATERIALS CO., LTD. (Note 1 and Note 2)

NIPPON PAINT COATINGS (TAIWAN) CO., LTD.

NIPSEA CHEMICAL CO., LTD.

NIPPON PAINT (MALAYSIA) SDN. BHD.

PAINT MARKETING CO. (M) SDN. BHD.

NIPPON PAINT (SINGAPORE) COMPANY PRIVATE LIMITEDNIPSEA TECHNOLOGIES PTE. LTD.

NIPPON PAINT (THAILAND) COMPANY LIMITED

Prior to

Additional

Afteracquisitionacquisitionacquisition

51%

49%

100%

(－%)

(49%)

(49%)

51%

49%

100%

(－%)

(49%)

(49%)

51%

49%

100%

(－%)

(49%)

(49%)

51%

49%

100%

(－%)

(49%)

(49%)

60%

40%

100%

(－%)

(40%)

(40%)

60%

40%

100%

(－%)

(40%)

(40%)

51%

49%

100%

(－%)

(－%)

(－%)

51%

49%

100%

(－%)

(－%)

(－%)

51%

49%

100%

(－%)

(－%)

(－%)

51%

49%

100%

(－%)

(－%)

(－%)

51%

49%

100%

(－%)

(－%)

(－%)

51%

49%

100%

(－%)

(－%)

(－%)

51%

48.9%

99.9%

(－%)

(－%)

(－%)

Note 1: Company owned indirectly through NIPSEA PTE. LTD.
Note 2: NIPPE TRADING CO., LTD. was renamed NIPPON PAINT MATERIALS CO., LTD. on January 1, 2021.

18

2. Issuance of new shares through the third-party allotment and change in parent company
Of the total payment of ¥1,285,139 million for the acquisition of the Asian JVs and Indonesia business,¥100,000 million was paid in cash as part of the cost of the acquisition of the Indonesia business. The remaining
amount of ¥1,185,139 million was paid by issuing new shares of the Company through a third-party allotment
in exchange for a contribution in kind from NIPSEA INTERNATIONAL LIMITED and FRASER (HK)
LIMITED consisting of the claim for payment of consideration. The pay-in procedure was completed on January
25, 2021.
(1) Outline of the offering

Total number of issued shares

Before capital

Increase throughAfter capitalincrease

capital increase

increase

325,402,443 shares

148,700,000 shares

474,102,443 shares¥78,862 million¥592,569 million¥671,432 million

Amount of capital stock
Class of shares

Common stock

Amount to be paid in¥7,970 per share

Total amount to be paid in¥1,185,139 million (Note)

Method of allotment

Third-party allotment

Subscribers and number of shares to be

NIPSEA INTERNATIONAL LIMITED

131,700,000 sharesallotted

FRASER (HK) LIMITED

17,000,000 shares

Note: No cash payment was required because the new shares were issued in exchange for contribution in kind consisting of the claim
for payment of consideration.

(2) Change in the parent company
The following companies became parent companies of the Company.
NIPSEA INTERNATIONAL LIMITEDNIPSEA HOLDINGS INTERNATIONAL LIMITEDWUTHELAM HOLDINGS LIMITEDRAINBOW LIGHT LIMITED (final parent company)(Stock split)
The Board of Directors of the Company approved a resolution on February 10, 2021 toimplement a stock split and amend the Articles of Incorporation.
1. Purpose of the stock split
The purpose of the stock split is to improve the liquidity of the Company’s stock and make thestock more accessible to a broader base of investors as well as our Group’s employees and others
by reducing the price per investment unit19

2. Outline of the stock split(1) Method of the stock split
Each share of common stock owned by shareholders listed or recorded in the final register ofshareholders as of the record date of March 31, 2021 will be split into five shares.
(2) Number of shares to be increased by the stock split
Total number of shares prior to the stock split

474,102,443 shares

Number of shares to be increased by the stock split

1,896,409,772 shares

Total number of issued shares following the stock split

2,370,512,215 shares

Total number of authorized shares following the stock split

5,000,000,000 shares(3) Schedule of the stock split
Public notice of record date

March 12, 2021

Record date

March 31, 2021

Effective date

April 1, 2021

3. Impact on per share information
Per share information assuming that the stock split was performed at the beginning of the
fiscal year ended December 31, 2019 is as follows.
Fiscal year ended December 31, Fiscal Year Ended December 31,
2019(January 1, 2019 to December

2021(January 1, 2020 to December

31, 2019)

31, 2020)

344.75354.30

22.90

27.83

22.89

27.83

Equity attributable toowners of the parent
company per share (yen)Basic earnings per share(yen)
Diluted earnings per share(yen)

4. Associated amendment to the Articles of Incorporation(1) Reason for the amendment
In conjunction with this stock split, pursuant to Article 184, Paragraph 2 of the Companies
Act, the Company will amend Article 6 (Total Number of Authorized Shares) of its Articles ofIncorporation.
20

(2) Details of the amendment(Changes are underlined)
Prior to the amendment

Following the amendment(Total Number of Authorized Shares)(Total Number of Authorized Shares)

Article 6 The total number of shares authorized

Article 6 The total number of shares authorized

to be issued by the Company shall be

to be issued by the Company shall be

one billion shares.

five billion shares.

(3) Schedule of the amendment
Effective date: April 1, 2021
5. Other(1) The amount of stated capital will not change as a result of this stock split.

21