Consolidated Financial Results
for the Fiscal Year Ended March 31, 2022
[Japanese GAAP]
April 28, 2022
Company name: SHIKOKU CHEMICALS CORPORATION
Stock exchange listing: Tokyo Stock Exchange
Code number: 4099
URL: https://www.shikoku.co.jp/
Representative: Naoto Tanaka, President and C.E.O.
Contact: Yoshinori Manabe, Executive Officer, Deputy Head of Corporate Strategy & Business Promotion
Phone: +81-877-22-4111
Scheduled date of annual general shareholders’ meeting: June 24, 2022
Scheduled date of commencing dividend payments: June 6, 2022
Scheduled date of filing annual securities report: June 24, 2022
Availability of supplementary briefing material on annual financial results: Available
Schedule of annual financial results briefing session: Scheduled(Amounts less than one million yen are rounded down)
1. Consolidated Financial Results for the Year Ended March 31, 2022 (from April 1, 2021 to March 31, 2022)(1) Consolidated Operating Results(% indicates changes from the previous corresponding period.)
Profit attributable to
Net sales
Operating profit
Ordinary profit
owners of parent
Year ended
Million yen%
Million yen%
Million yen%
Million yen%
March 31, 2022
54,137
9.2
8,400
13.5
9,291
16.2
6,878
19.4
March 31, 2021
49,590
(3.8)
7,401
(5.7)
7,997
(0.3)
5,760
2.7
(Note) Comprehensive income: Year ended March 31, 2022: ¥8,138 million [5.3%]
Year ended March 31, 2021: ¥7,732 million [75.2%]
Basic earnings
per share

Dilutedearnings
per share

Return on
equityRatio ofordinary profit
to total assets

Ratio ofoperating profit
to net sales

Year ended
Yen
Yen
%
%
%
125.52
–
8.8
8.4
15.5
March 31, 2022
March 31, 2021
103.27
–
7.9
7.7
14.9
(Reference) Share of profit (loss) of entities accounted for using equity method: Year ended March 31, 2022: –Year ended March 31, 2021: –(2) Consolidated Financial Position
Total assets

Net assets

Million yen

Equity ratio

Net assets per share

Million yen%

Yen

80,908
As of March 31, 2022
113,805
76,566
As of March 31, 2021
107,344(Reference) Equity: As of March 31, 2022: ¥80,049 million
As of March 31, 2021: ¥75,718 million

70.3
70.5

1,487.55
1,360.26(3) Consolidated Cash Flows

Year ended
March 31, 2022
March 31, 2021

Cash and cash
equivalents
at year-end

Cash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities

Million yen

Million yen

Million yen

Million yen

5,089
7,411

(5,087)(2,999)(1,809)89

35,75537,207

2. Dividends
1stquarterend
Year ended
March 31, 2021
Year ended
March 31, 2022
Year ending
December 31,
2022 (Forecast)

Annual dividends
2nd
3rd
Yearquarter- quarterend
end
end

Total

Total
dividends(annual)Ratio of
Payout ratio dividends to(consolidated)
net assets(consolidated)

Yen

Yen

Yen

Yen

Yen

Million yen

%

%

–

12.00

–

12.00

24.00

1,338

23.2

1.8

–

12.00

–

12.00

24.00

1,304

19.1

1.7

–

13.00

–

13.00

26.00

37.8

3. Forecast of Consolidated Financial Results for the Year Ending December 31, 2022 (from April 1, 2022 to
December 31, 2022)(% 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

Full year
46,000
–
5,800
–
6,100
–
3,700
–
68.76
(Note) The Company plans to change its fiscal year-end (the last day of the fiscal year) from March 31 to December
31 of each year beginning with the 103rd fiscal year, conditional upon the approval for an associatedamendment to the Articles of Incorporation at the 102nd Annual General Meeting of Shareholders to be heldon June 24, 2022. Due to this change in fiscal year-end, the 103rd fiscal year will be a transitional period ofnine months from April 1, 2022 to December 31, 2022. Therefore, the above forecast of consolidated financial
results for the year ending December 31, 2022 represents nine-month forecast figures, and the percentagechanges from the previous corresponding period are omitted.
* Notes:(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in changes inscope of consolidation): No(2) Changes in accounting policies, changes in accounting estimates and retrospective restatement
1) Changes in accounting policies due to the revision of accounting standards: Yes
2) Changes in accounting policies other than 1) above: No
3) Changes in accounting estimates: No4) Retrospective restatement: No(3) Total number of issued shares (ordinary shares)
1) Total number of issued shares at the end of the period (including treasury shares):
March 31, 2022: 54,018,563 shares
March 31, 2021: 55,877,263 shares2) Total number of treasury shares at the end of the period:
March 31, 2022: 205,788 shares
March 31, 2021: 212,603 shares
3) Average number of shares during the period:
Year ended March 31, 2022: 54,802,469 sharesYear ended March 31, 2021: 55,782,227 shares* These annual financial results are outside the scope of audit by certified public accountants or audit firms* Explanation regarding the appropriate use of financial results forecasts and other special items
The above financial results forecasts are based on information currently available to the Company as of the dateof this report, and do not constitute a guarantee of future results. Actual results may differ significantly from these
forecasts due to a wide range of factors. For information about the above financial results forecasts, please refer to“(4) Future Outlook” under “1. Overview of Operating Results, etc.” on page 4 of the attached documents to thefinancial statements.

Table of Contents
1. Overview of Operating Results, etc............................................................................................. 2(1) Overview of Operating Results for the Year under Review ............................................................ 2(2) Overview of Financial Position for the Year under Review............................................................ 3(3) Overview of Cash Flows for the Year under Review .................................................................... 3(4) Future Outlook....................................................................................................................... 4(5) Basic Policy regarding Distribution of Earnings and Dividends for the Current and Next Fiscal Years . 4
2. Basic Policy on Selection of Accounting Standards ....................................................................... 5
3. Consolidated Financial Statements and Primary Notes ................................................................. 6(1) Consolidated Balance Sheet ................................................................................................... 6(2) Consolidated Statements of Income and Comprehensive Income .................................................. 8(3) Consolidated Statement of Changes in Shareholders’ Equity ........................................................10(4) Consolidated Statement of Cash Flows .....................................................................................12(5) Notes to Consolidated Financial Statements .............................................................................13(Notes on going concern assumption) .....................................................................................13(Changes in accounting policies) ............................................................................................13(Segment information, etc.) ...................................................................................................13(Per share information) .........................................................................................................16(Significant subsequent events) ..............................................................................................17

1

1. Overview of Operating Results, etc.
(1) Overview of Operating Results for the Year under Review
The Japanese economy during the fiscal year under review saw signs of a temporary recovery following thelifting of the state of emergency on September 30. However, the pace of the economic activity resumption has
remained slow due to delayed vaccination rollout and the effects of production constraints centered on theautomobile industry, etc. since the rapid spread of Omicron strain from the beginning of the year. Overseas
economies continue to pick up globally, especially in Europe and the United States. However, economic outlook
is extremely uncertain due to global issues becoming more serious, as exemplified by prolonged constraints on
supply of semiconductors and other materials, high energy and resources prices accelerated by Russia’s invasionof Ukraine, and rising logistics costs due to a global shortage of containers and soaring sea freight rates.
Under these circumstances, for the fiscal year under review, the Group posted net sales of ¥54,137 million(up 9.2% year-on-year), operating profit of ¥8,400 million (up 13.5% year-on-year), ordinary profit of ¥9,291
million (up 16.2% year-on-year) and profit attributable to owners of parent of ¥6,878 million (up 19.4% yearon-year), all of which increased from the previous year’s results. In addition, net sales, operating profit, ordinary
profit, and profit attributable to owners of parent all hit record h ighs and achieved high levels against the
backdrop of global economic recovery from the COVID-19 pandemic.
Operating results by segment are as follows.
1) Chemicals operations(Inorganic chemicals)
Sales of insoluble sulfur, a material for radial tires, largely surpassed those of the previous fiscal year, which
was affected by the spread of COVID-19, due to solid demand for replacement tires and industrial vehicle tires,
despite a decline in automobile production resulting from semiconductor shortages. Sale s of carbon disulfide forrayon and cellophane, and sodium sulfate for bath agents and detergents increased year on year due to a reboundfrom the COVID-19 pandemic.
(Organic chemicals)
Regarding chlorinated isocyanuric acid for disinfectants, the domestic market performed better than theprevious year mainly due to a recovery in sales of agents for swimming pools following the partial resumptionof swimming lessons at schools. In the U.S. market, the balance between supply and demand is tightening mainly
due to a recovery in economic conditions and stay -at-home demand, and the Company tried to improve
profitability by passing on soaring resource prices and distribution costs, which resulted in a significant increasein profitability.
(Fine chemicals)
Regarding Glicoat-SMD, a heat-resistant soluble OSP (Organic Solderability Preservative) for printed wiringboards, sales remained solid, against a backdrop of the growth of electronics markets worldwide. Sales of advanced& specialty chemicals such as epoxy resin curing agent (imidazoles), resin modifier (glycoluril derivatives, etc.)
and semiconductor processing materials increased year on year, backed by an increase in demand for use inelectronic components.
As a result, net sales for the chemicals operations segment were ¥34,995 million (up 17.2% year-on-year), andsegment profit was ¥7,545 million (up 33.2% year-on-year), both surpassing the previous year’s results.
2) Housing Materials operations
Although the number of new housing starts showed signs of a slight recovery, sales of interior, exterior
finishes and paving materials and exterior products remained sluggish, as governments and private companies

2deferred or had a wait-and-see attitude for their projects or capital investment, against a backdrop of falling
consumer sentiment and uncertainty about the future. Profitability also declined due to soaring prices of raw
materials including aluminum ingots.
As a result, net sales for the housing materials operations segment were ¥17,961 million (down 4.3% yearon-year), and segment profit was ¥2,576 million (down 26.5% year-on-year), both falling below the previous
year’s results.
Reference information[Overseas net sales]Year ended March 31, 2021
(from April 1, 2020 to March 31, 2021)
Net sales(Million yen)Overseas net sales toconsolidated net sales (%)

Year ended March 31, 2022
(from April 1, 2021 to March 31, 2022)
Net sales(Million yen)Overseas net sales toconsolidated net sales (%)

Other regions

7,319
5,943
1,741

14.8
12.0
3.5

8,372
8,465
2,130

15.5
15.6
3.9

Total

15,00430.3

18,96835.0

Consolidated net
sales

49,590

Asia
North America

54,137(2) Overview of Financial Position for the Year under Review(Status of assets, liabilities and net assets)
Total assets increased by ¥6,461 million from the end of the previous fiscal year to ¥113,805 million. Major
increases were ¥2,625 million in investment securities and ¥1,767 million in accounts receivable - trade.
Liabilities increased by ¥2,119 million from the end of the previous fiscal year to ¥32,897 million. A major
increase was ¥2,000 million in current portion of long -term borrowings.
Net assets increased by ¥4,342 million from the end of the previous fiscal year to ¥80,908 million. Major
increases were ¥3,334 million in retained earnings and ¥1,064 million in valuation difference on available -forsale securities.
As a result, equity ratio fell to 70.3%, from 70.5% at the end of the previous fiscal year.

(3) Overview of Cash Flows for the Year under Review
Cash flows provided by operating activities totaled ¥5,089 million (a decrease of ¥2,321 million year-onyear). Major cash inflows were profit before income taxes of ¥9,710 million and depreciation of ¥2,090 million,
while a major cash outflow was income taxes paid of ¥2,739 million.
Cash flows used in investing activities totaled ¥5,087 million (an increase of ¥2,087 million year-on-year).
The major component was purchase of property, plant and equipment of ¥4,153 million.
Cash flows used in financing activities totaled ¥1,809 million (an increase of ¥1,898 million year-on-year).
A major cash inflow was proceeds from long-term borrowings of ¥2,160 million, while major cash outflows
were purchase of treasury shares of ¥2,474 million and dividends paid of ¥1,326 million.
As a result, cash and cash equivalents totaled ¥35,755 million (a decrease of ¥1,451 million from the end of
the previous fiscal year).

3(4) Future Outlook
Consolidated financial results forecast for the year ending December 31, 2022 is as follows.
These financial results forecasts are based upon the assumption that the effect of COVID-19, soaring resource
prices and logistics costs, and the impact of the situation in Russia and Ukraine on the world economy will not
deteriorate any further.
Net sales are expected to grow at a higher rate year-on-year, driven primarily by exports of insoluble sulfur andchlorinated isocyanuric acid, against the backdrop of the recovery of the global economy. Even though the Company
has been flexibly passing on resource prices and logistics costs, the chlorinated isocyanuric acid manufacturing
facility, which is under construction at a cost of approximately ¥5 billion, will start operation in July 2022. Therefore,
profit is expected to be lower year-on-year due to the advancement of depreciation burden associated with the
declining balance method for depreciation of the asset.
The business environment surrounding the Company is expected to remain extremely uncertain. If it becomes
necessary to revise the financial results forecasts due to changes in the situation, the Company will promptly
announce the revision.

Operating profit

Ordinary profit

46,000

5,800

6,100

(Million yen)
Profit attributableto owners of parent
3,700

54,137

8,400

9,291

6,878

–

–

–

–

Net SalesYear ending December 31,
2022 (full year)
Year ended March 31, 2022
(full year)
Change (%)(Notes) 1. The major exchange rates assumed in the above financial results forecast were ¥120 to $1 and ¥130 to€1.
2. The Company plans to change its fiscal year-end (the last day of the fiscal year) from March 31 to
December 31 of each year beginning with the 103rd fiscal year, conditional upon the approval for an
associated amendment to the Articles of Incorporation at the 102nd Annual General Meeting of
Shareholders to be held on June 24, 2022. Due to this change in fiscal year-end, the 103rd fiscal year
will be a transitional period of nine months from April 1, 2022 to December 31, 2022. Therefore, theabove forecast of consolidated financial results for the year ending December 31, 2022 represents ninemonth forecast figures, and the percentage changes from the previous corresponding period are omitted.
3. The above financial results forecasts are based on information currently available to the Company as ofthe date of this report, and do not constitute a guarantee of future results. Actual results may differ
significantly from these forecasts due to a wide range of factors.
(5) Basic Policy regarding Distribution of Earnings and Dividends for the Current and Next Fiscal Years
As a basic policy for shareholder returns, the Company aims to achieve “a dividend payout ratio of 30% and a
total payout ratio of 50% based on consolidated financial results” under the “Challenge 1000” long-term vision
towards 2030.
The Company has decided to pay an annual dividend of ¥24 per share for the fiscal year under review, or a yearend dividend of ¥12 per share after deducting the interim dividend already paid (¥12).
As for the interim dividend for the year ending December 31, 2022, in considerat ion of the above policy, businessperformance and financial situation, the Company plans to pay a dividend of ¥13 yen per share, which is made upof ¥12 per share and additional ¥1 as a commemorative dividend to celebrate the Company’s 75th anniversary since
the establishment on October 10 of this year.
As for the year-end dividend forecast, the Company plans to increase the dividend by ¥1 as a commemorative
dividend as well and expects to pay ¥13 per share as described above. As a result, the annual divide nd forecast for
the year ending December 31, 2022 will be ¥26 per share.

42. Basic Policy on Selection of Accounting Standards
The Group plans to adopt Japanese GAAP in preparing its consolidated financial statements for the time
being, given that the Group has little need to raise funds from overseas and considering the burden of preparing
its consolidated financial statements based on the International Financial Reporting Standards (IFRS). However,the Group will consider the adoption of IFRS depending on future needs.

53. Consolidated Financial Statements and Primary Notes(1) Consolidated Balance Sheet(Million yen)
As of March 31, 2021
AssetsCurrent assets
Cash and deposits
Notes receivable - trade
Electronically recorded monetary claims - operating
Accounts receivable - trade
Securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
LandConstruction in progress
Other, net
Total property, plant and equipment
Intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Retirement benefit asset
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

6

As of March 31, 2022

25,907
1,360
2,678
11,27613,999
6,259
46
3,024
471
(1)
65,024

23,155
1,271
2,622
13,044
15,600
7,373
41
3,689
870
(1)
67,668

5,040
3,176
8,857
3,771
646
21,492
165

5,238
4,136
8,523
3,776
692
22,366356

19,705
324
309
325
(3)
20,662
42,319107,344

22,331
319
364
403
(3)
23,414
46,137
113,805

(Million yen)
As of March 31, 2021
Liabilities
Current liabilities
Notes and accounts payable - trade
Electronically recorded obligations - operating
Short-term borrowings
Current portion of long-term borrowings
Accrued expenses
Income taxes payable
Accrued consumption taxes
Notes payable - facilities
Electronically recorded obligations-facilities
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Deferred tax liabilities
Deferred tax liabilities for land revaluation
Provision for retirement benefits for directors (andother officers)
Retirement benefit liability
Asset retirement obligations
Provision for share awards
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Revaluation reserve for land
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

7

As of March 31, 2022

6,602
338
2,530
74
1,418
1,389
201
17
75
3,055
15,702

7,993
471
2,530
2,074
1,449
1,849
116
36
49
2,537
19,10910,95716
1,111

11,017
295
1,008

77

90

2,134
379
32
365
15,07530,778

625
380
50
318
13,78832,897

6,867
5,740
57,140(236)
69,512

6,867
5,740
60,475(250)
72,833

3,789
(27)
2,533
(90)
0
6,205
847
76,566
107,344

4,853
–
2,298
32
30
7,215
859
80,908113,805

(2) Consolidated Statements of Income and Comprehensive Income
Consolidated Statement of Income(Million yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Transportation and storage costs
Advertising expenses
Salaries
Retirement benefit expenses
Provision for retirement benefits for directors (and otherofficers)
Research and development expenses
Other
Total selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Foreign exchange gains
Miscellaneous income
Total non-operating income
Non-operating expenses
Interest expenses
Sales discounts
Donations
Miscellaneous losses
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sale of non-current assets
Gain on sale of investment securities
Subsidy income
Total extraordinary income
Extraordinary losses
Loss on sale of non-current assets
Loss on retirement of non-current assets
Impairment losses
Loss on sale of investment securities
Loss on valuation of investment securities
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

8

For the year ended
March 31, 2021
49,59029,50620,083For the year ended
March 31, 2022
54,13731,363
22,774

4,525
410
2,222
193

5,964
473
2,228
149

17

17

1,207
4,105
12,682
7,401

1,392
4,147
14,374
8,400

47
452
169
98
767

66
478
359
65
969

20
125
–
24
171
7,997

23
–
50
4
78
9,291

0
478
35
513

1
856
28
885

–
39
66
147
–
252
8,258
2,452
7
2,459
5,798
38
5,760

0
23
436
–
6
466
9,710
3,145
(319)
2,825
6,884
6
6,878

Consolidated Statement of Comprehensive Income(Million yen)

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
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests

9

For the year ended
March 31, 2021
5,798

For the year ended
March 31, 2022
6,884

1,821
(23)
18
116
1,933
7,732

1,073
27
122
29
1,253
8,138

7,689

8,124

42

14

(3) Consolidated Statement of Changes in Shareholders’ Equity
Year ended March 31, 2021 (from April 1, 2020 to March 31, 2021)(Million yen)
Shareholders’ equity
Share capital

Capital surplus

6,867

5,815

Balance at beginning of period
Changes during period
Dividends of surplus
Profit attributable to owners ofparentPurchase of treasury shares
Disposal of treasury shares
Cancellation of treasury shares
Disposal of treasury shares bystocks payment trust
Net changes in items other thanshareholders’ equity
Total changes during period
Balance at end of period

Retainedearnings
56,063

9
(84)

–
6,867

Treasury shares(2,183)(1,354)(1,354)

5,760

5,760

(3,329)

(75)
5,740

Total
shareholders’equity66,563

1,076
57,140(1,605)137
3,413(1,605)
146
–

2

2

1,947
(236)

2,949
69,512

Accumulated other comprehensive income

Balance at beginning of
periodChanges during period
Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
sharesCancellation of treasury
shares
Disposal of treasury
shares by stocks payment
trust
Net changes in items
other than shareholders’equityTotal changes during period
Balance at end of period

Valuation

Deferreddifference on
available-for-gains orlosses on

sale securities

hedges1,972(4)

Revaluation
reserve forland

Foreigncurrencytranslation
adjustment

2,533

(109)

Remeasure-

Total

ments
of defined

accumulated
otherbenefitplans

comprehensive income

(115)

4,276

Noncontrollinginterests

808

Total net
assets

71,647(1,354)5,760(1,605)
146
–
2

1,816

(23)

–

18

116

1,928

39

1,968

1,816
3,789

(23)
(27)

–
2,533

18
(90)

116
0

1,928
6,205

39
847

4,918
76,566

10

Year ended March 31, 2022 (from April 1, 2021 to March 31, 2022)(Million yen)
Shareholders’ equity
Share capital

Capital surplus

6,867

5,740

Balance at beginning of period
Changes during period
Dividends of surplus
Profit attributable to owners ofparentPurchase of treasury shares
Cancellation of treasury shares
Reversal of revaluation reserve
for land
Disposal of treasury shares bystocks payment trust
Net changes in items other thanshareholders’ equity
Total changes during period
Balance at end of period

Retainedearnings

Treasury shares

57,140

(236)

Total
shareholders’equity69,512(1,326)(1,326)

6,878

6,878
(2,474)2,452(2,452)(2,474)
–

235

–
6,867

–
5,740

235

3,334
60,475

8

8

(13)
(250)

3,321
72,833

Accumulated other comprehensive income

Balance at beginning of
periodChanges during period
Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
sharesCancellation of treasury
shares
Reversal of revaluation
reserve for land
Disposal of treasury
shares by stocks payment
trust
Net changes in items
other than shareholders’equityTotal changes during period
Balance at end of period

Valuation

Deferreddifference on
available-for-gains orlosses on

sale securities

hedges

3,789

(27)

Revaluation
reserve for
land

2,533

Foreigncurrencytranslation
adjustment(90)

RemeasureTotal
ments
accumulatedof defined
benefitothercomprehen-plans

sive income

0

6,205

Noncontrollinginterests

847

Total net
assets76,566(1,326)
6,878(2,474)
–
235
8

1,064

27

(235)

122

29

1,009

11

1,021

1,064
4,853

27
–

(235)
2,298

122
32

29
30

1,009
7,215

11
859

4,342
80,90811

(4) Consolidated Statement of Cash Flows(Million yen)
For the year ended
March 31, 2021
Cash flows from operating activities
Profit before income taxes
Depreciation
Impairment losses
Increase (decrease) in retirement benefit liability
Decrease (increase) in retirement benefit asset
Contribution to employees’ retirement benefits trust
Interest and dividend income
Interest expenses
Loss (gain) on valuation of investment securities
Loss (gain) on sale of investment securities
Subsidy income
Loss on retirement of property, plant and equipment
Loss (gain) on sale of property, plant and equipment
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Increase (decrease) in trade payables
Increase (decrease) in accrued consumption taxes
Other, net
SubtotalInterest and dividends received
Interest paid
Subsidies received
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of securities
Proceeds from redemption of securities
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
Payments for retirement of property, plant and equipment
Purchase of investment securities
Proceeds from sale and redemption of investment
securities
Decrease (increase) in time deposits
Other, net
Net cash provided by (used in) investing activities
Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Proceeds from long-term borrowings
Repayments of long-term borrowings
Purchase of treasury shares
Proceeds from sale of treasury shares
Dividends paid
Dividends paid to non-controlling interests
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 year ended
March 31, 2022

8,258
1,835
66
(36)
29
–
(499)
20
–
(331)
(35)
39
(0)
(131)
747
(22)
(126)
(527)
9,286
500
(21)
35
(2,388)
7,411

9,710
2,090
436
(27)
6
(1,500)
(544)
23
6
(856)
(28)
23
(0)
(1,317)(1,627)
1,366
(440)
(44)
7,276
547
(23)
28
(2,739)5,089(3,200)4,500(3,618)0(32)(3,255)(2,300)2,000(4,153)5(19)(1,235)

1,613

1,006

1,000
(6)
(2,999)–(391)(5,087)

(200)
3,900
(718)
(1,605)146(1,354)
(3)
(75)
89
98
4,599
32,607
37,207

–
2,160
(100)
(2,474)–(1,326)(3)(64)(1,809)355(1,451)
37,20735,755(5) Notes to Consolidated Financial Statements(Notes on going concern assumption)
There is no relevant information.
(Changes in accounting policies)(Adoption of Accounting Standard for Revenue Recognition, etc.)
The Company has applied the “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29, March
31, 2020, hereinafter referred to as “Revenue Recognition Accounting Standard”) from the beginning of the fiscal
year under review to recognize revenue when control of promised goods or services is transferred to a customer inthe estimated amount to be received in exchange for those goods or services.
The application of the Revenue Recognition Accounting Standard follows the transitional measures set forth in
the proviso of Paragraph 84 of the Revenue Recognition Accounting Standard, but has no impact on the beginningbalance of retained earnings.
In addition, the adoption of the Revenue Recognition Accounting Standard has no impact on Consolidated
Financial Statements for the fiscal year under review.
“Notes and accounts receivable - trade” presented in “Current assets” in the Consolidated Balance Sheet of theprevious fiscal year are presented in “Notes receivable - trade” and “Accounts receivable - trade” from the fiscal
year under review. Accordingly, the Company made reclassification of the previous fiscal year’s Consolidated
Balance Sheet due to the change.
(Adoption of Accounting Standard for Fair Value Measurement, etc.)
The Company has applied the “Accounting Standard for Faire Value Measurement” (ASBJ Statement No. 30,
July 4, 2019, hereinafter referred to as “Fair Value Measurement Accounting Standard”) from the beginning of the
fiscal year under review. In accordance with the transitional measures set forth in Paragraph 19 of the Fair Value
Measurement Accounting Standard and Paragraph 44-2 of the “Accounting Standard for Financial Instruments”(ASBJ Statement No. 10, July 4, 2019), the Company has applied the new accounting po licies set forth in the Fair
Value Measurement Accounting Standard into the future. This application has no impact on the consolidated
financial statements.
(Segment information, etc.)
1. Overview of reportable segments
The Group’s reportable segments are components within the Group for which discrete financial information isavailable and are regularly reviewed by the Company’s Board of Directors for the purpose of determining theallocation of management resources and evaluating performance.
Each business division of the Company formulates comprehensive strategies for domestic and overseas
businesses in relation to the products and services it handles and carries out business activities accordingly.
Therefore, the Group is comprised of segments that are classified according to products and services based on
its business divisions. The two reportable segments of the Group are “Chemicals operations” and “Housing
Materials operations.”
The “Chemicals operations” segment is engaged in the production and sale o f chemical products such as
inorganic chemicals, organic chemicals and fine chemicals. The “Housing Materials operations” segment is engaged
in the production and sale of building and construction materials such as interior and exterior decorative walls,
exterior products and aluminum shutters.
2. Calculation methods of net sales, profit, loss, assets and other items by reportable segment
The method of accounting for the business segments reported are the same as those described in “Important
Matters that Form the Basis for Preparing Consolidated Financial Statements.”
Profit of the reportable segments is based on operating profit.
Inter-segment net sales and transfers are based on market price.

13

3. Information on net sales, profit (loss), assets and other items by reportable segment and information oncomposition of revenue
Year ended March 31, 2021 (from April 1, 2020 to March 31, 2021 )(Million yen)
Reportable segment
Housing
Chemicals
Materials
Total
operations
operations
Net sales
Net sales to outside customers
Inter-segment net sales
or transfers
Total
Segment profit
Segment assets
Other items
Depreciation
Impairment losses
Increase in property, plant andequipment and intangible
assets

Other(Note) 1

Total

Amount recorded inconsolidated
Adjustment
financial statements(Note) 2(Note) 3

29,85018,76048,611

979

49,590–49,590

0

2

3

266

270

(270)

–

29,851
5,664
45,681

18,763
3,505
15,62048,6159,170
61,302

1,246
130
2,156

49,861
9,301
63,458(270)(1,899)43,88549,5907,401
107,344

1,425
–

225
66

1,651
66

53
–

1,705
66

129
–

1,835
66

3,446

328

3,775

110

3,886

220

4,106

(Notes) 1. The “Other” category represents business segments not included in the reportable segments, andincludes the IT systems operations and food operations.
2. The adjustment for segment profit of ¥(1,899) million includes inter-segment eliminations of ¥0 million
and corporate expenses in the amount of ¥(1,900) million not allocated to each reportable segment. The
relevant corporate expenses are mainly general and administrative expenses not allocated to thereportable segments.
The adjustment for segment assets of ¥43,885 million includes inter-segment eliminations of ¥(4)
million and corporate assets in the amount of ¥43,890 million not allocated to each reportable segment.
The adjustment for increase in property, plant and equipment and intangible assets of ¥220 million isthe amount of capital expenditure related to corporate assets not allocated to each reportable segment.
3. Segment profit is adjusted with operating profit on the consolidated statement of income.

14

Year ended March 31, 2022 (from April 1, 2021 to March 31, 2022)(Million yen)
Reportable segment
Housing
Chemicals
Materials
Total
operations
operations

Other(Note) 1

Total

Amount recorded in
Adjustment
consolidated(Note) 2
financial statements(Note) 3

Net sales
Inorganic chemicals
12,192– 12,192–
12,192–
12,192
Organic chemicals
13,023– 13,023–
13,023–13,023
Fine chemicals
9,778
–
9,778
–
9,778
–
9,778
Interior, exterior finishes
–
1,395
1,395
–
1,395
–
1,395
and paving materials
Exterior products–
16,565 16,565–
16,565–
16,565
Other
–
–
–
1,181
1,181
–
1,181
Revenue from contracts
34,995
17,961 52,956
1,181
54,137–54,137
with customers
Net sales to outside
34,995
17,961 52,956
1,181
54,137–54,137
customers
Inter-segment net sales or
1
1
2
273
276
(276)
–
transfers
Total
34,996
17,962 52,959
1,454
54,413(276)
54,137
Segment profit
7,545
2,576 10,122
171
10,293(1,893)8,400
Segment assets
52,061
15,569 67,631
2,192
69,82343,982
113,805
Other items
Depreciation
1,621
262
1,884
62
1,946
143
2,090
Impairment losses
–
436
436
–
436
–
436
Increase in property, plantand equipment and
2,860
595
3,455
5
3,461
138
3,599
intangible assets(Notes) 1. The “Other” category represents business segments not included in the reportable segments, andincludes the IT systems operations and food operations.
2. The adjustment for segment profit of ¥(1,893) million includes inter-segment eliminations of ¥1 million
and corporate expenses in the amount of ¥(1,895) million not allocated to each reportable segment. The
relevant corporate expenses are mainly general and administrative expenses not allocated to thereportable segments.
The adjustment for segment assets of ¥43,982 million includes inter-segment eliminations of ¥(7)
million and corporate assets in the amount of ¥43,990 million not allocated to each reportable segment.
The adjustment for increase in property, plant and equipment and intangible assets of ¥138 million isthe amount of capital expenditure related to corporate assets not allocated to each reportable segment.
3. Segment profit is adjusted with operating profit on the consolidated statement of income.

15

(Per share information)
Year ended March 31, 2021
(from April 1, 2020
to March 31, 2021)

Year ended March 31, 2022
(from April 1, 2021
to March 31, 2022)

1,360.26 yen

1,487.55 yen

103.27 yen

125.52 yen

Net assets per share
Basic earnings per share(Notes) 1. The Company’s shares held in the trust related to the stock compensation plan, which are recorded astreasury shares under shareholders’ equity, are included in treasury shares that are excluded from thecalculation of the average number of shares during the period when calculating basic earnings per share,
and are also included in treasury shares that are excluded from the total number of issued shares at theend of the period when calculating net assets per share.
The average number of shares during the period excluded for the fiscal year under review was 143
thousand shares, while the average number of shares during the period excluded for the previous fiscal
year was 148 thousand shares. Diluted earnings per share are not provided, as there are no dilutive
shares.
2. The basis for calculation of basic earnings per share is as follows:Year ended March 31, 2021
(from April 1, 2020
to March 31, 2021)
Profit attributable to owners of parent(Million yen)

Year ended March 31, 2022
(from April 1, 2021
to March 31, 2022)

5,760

6,878

–

–

Profit attributable to owners of parent
related to ordinary shares(Million yen)

5,760

6,878

Average number of ordinary shares during
the period (Thousand shares)

55,78254,802

Amount not attributable to commonshareholders (Million yen)

3. The basis for calculation of net assets per share is as follows:
As of March 31, 2021
Total net assets (Million yen)

As of March 31, 2022

76,56680,908Amount deducted from total net assets (Million yen)

847

859

(Non-controlling interests included in above) (Million yen)

[847]

[859]

Amount of net assets related to ordinary shares at end of
period (Million yen)

75,71880,049Number of ordinary shares used in the calculation of net
assets per share at end of period (Thousand shares)

55,66453,81216

(Significant subsequent events)(Transition to Holding Company Structure by Company Split)
At the meeting of Board of Directors held on April 28, 2022, the Company resolved to conclude anabsorption-type company split agreement with three successor preparatory companies (Shikoku Chemical
Chemicals Operations Successor Preparatory Corporation, Shikoku Chemical Housing Materials Operations
Successor Preparatory Corporation and Shikoku Chemical Shared Service Successor Preparatory Corporation),
effective January 1, 2023 (scheduled).
After the absorption-type split, the Company will change its trade name to “SHIKOKU KASEI HOLDINGSCORPORATION” on January 1, 2023 (scheduled) along with the business purpose according to the businessafter the transition to the holding company structure. The implementation of the absorption -type company split
and amendments to the Articles of Incorporation (change of trade name and partial change of business p urpose)are subject to the prescribed resolution by the 102nd Annual General Meeting of Shareholders to be held on
June 24, 2022, and the approval of relevant government agencies as necessary.
Further, the Company resolved at the meeting of Board of Direct ors held on April 28, 2022 to change thefiscal year-end (the last day of the fiscal year), subject to the resolution of the proposal for the change of the
fiscal year specified in the current Articles of Incorporation at the 102nd Annual General Meeting o f
Shareholders to be held on June 24, 2022.
1. Overview of the Company Split(1) Method of the Company Split
Through the absorption-type split, with the Company as the absorption-type splitting company and the three
newly established successor preparatory companies as the absorption-type successor companies, the Company
will shift to a holding company structure while maintaining its listing status.
(2) Schedule of the Company Split
Date of the resolution of the Board of Directors for the establishment of successor preparatory companies:
October 26, 2021
Date of the establishment of successor preparatory companies: January 11, 2022
Date of the resolution of the Board of Directors for the absorption -type company split agreement: April 28,
2022
Date of conclusion of the absorption-type company split agreement: April, 28 2022
Date of the resolution of the Annual General Meeting of Shareholders for the absorption -type company split
agreement: June 24, 2022 (scheduled)
Effective date of the company split: January 1, 2023 (scheduled)
2. Overview of the Successor Companies(Chemicals operations)(1) Trade nameSHIKOKU CHEMICALS CORPORATION CHEMICALS OPERATIONSSPLIT PREPARATION CORPORATION
The trade name will change to “SHIKOKU CHEMICALS CORPORATION” on
January 1, 2023
(2) Address
8-537-1 Dokichōhigashi, Marugame City, Kagawa Prefecture(3) Name and title of
Naoto Tanaka, President
representative(4) Nature of business
Manufacturing, processing, sale, etc. of industrial chemicals, pharmaceuticals,quasi-drugs, fertilizers and pesticides(5) Amount of capital,
10 million yen
etc.
(6) Founded
January 11, 2022
(7) Number of shares
1,000 sharesissued(8) Fiscal year end
December 31(9) Major shareholders
The Company: 100%and shareholding ratios

17

(Housing Materials operations)(1) Trade nameSHIKOKU CHEMICALS CORPORATION HOUSING MATERIALOPERATIONS SPLIT PREPARATION CORPORATION
The trade name will change to “SHIKOKU KASEI KENZAI CORPORATION”
on January 1, 2023
(2) Address
8-537-1 Dokichōhigashi, Marugame City, Kagawa Prefecture(3) Name and title of
Naoto Tanaka, President
representative(4) Nature of business
Manufacturing, processing and sale of various construction and civil engineering
materials and products for houses and retail stores as well as designing,
construction, etc. of related facilities(5) Amount of capital,
10 million yen
etc.
(6) Founded
January 11, 2022
(7) Number of shares
1,000 sharesissued(8) Fiscal year end
December 31(9) Major shareholders
The Company: 100%and shareholding ratios(Shared Service)(1) Trade name(2) Address(3) Name and title ofrepresentative(4) Nature of business(5) Amount of capital,
etc.
(6) Founded(7) Number of sharesissued(8) Fiscal year end(9) Major shareholders
and shareholding ratios

SHIKOKU CHEMICALS CORPORATION SHARED SERVICES SPLITPREPARATION CORPORATION
The trade name will change to “SHIKOKU KASEI CORPORATE SERVICE
CO., LTD.” on January 1, 2023
8-537-1 Dokichōhigashi, Marugame City, Kagawa Prefecture
Naoto Tanaka, President
Support services related to accounting, finance, personnel, legal affairs, tax, labor,
compliance, internal control and asset management
10 million yen
January 11, 2022
1,000 shares
December 31
The Company: 100%

3. Overview of the Accounting Treatment to Be Carried Out
The Company plans to process the company split as a common control transaction pursuant to the“Accounting Standard for Business Combinations” (ASBJ Statement No. 21, January 16, 2019) and the“Implementation Guidance on Accounting Standard for Business Co mbinations and Accounting Standard forBusiness Divestitures (ASBJ Guidance No. 10, January 16, 2019).

18