Annual Report 2024
From April 2023 to March 2024

Financial Section
1. Preparation Policy of the Consolidated Financial Statements
The consolidated financial statements of the Company are prepared in accordance with International Financial
Reporting Standards (hereinafter “IFRS”) pursuant to the provisions of Article 93 of the Regulation on
Terminology, Forms and Preparation Methods of Consolidated Financial Statements (Ministry of Finance OrderNo. 28 of 1976; hereinafter the “Regulation on Consolidated Financial Statements”).
2. Audit Certification
In accordance with the provisions of Article 193-2, paragraph 1 of the Financial Instruments and Exchange Act
of Japan, the consolidated financial statements for the fiscal year ended March 31, 2024 were audited by KPMG
AZSA LLC.

3. Special Efforts to Ensure the Appropriateness of Consolidated Financial Statements, etc., and Development of a
System for Fair Preparation of Consolidated Financial Statements, etc. in Accordance with IFRS
(1) The Company has implemented special efforts to ensure the appropriateness of consolidated financial
statements, etc. Specifically, the Company has become a member of the Financial Accounting Standards
Foundation and obtains information including the latest accounting standards in order to develop a systemthat enables it to properly understand the contents of accounting standards, etc. or respond appropriately tochanges in accounting standards, etc. In addition, the Company’s staff members have attended seminars,
lectures and other events held by the Accounting Standards Board of Japan.
(2)

For the adoption of IFRS, the Company keeps up with the latest accounting standards by obtaining press
releases and standards published by the International Accounting Standards Board as needed. To prepare
appropriate consolidated financial statements under IFRS, the Company has developed accounting
policies, etc. of the Group in accordance with IFRS and performs accounting procedures based on thesepolicies.

－

1 －Consolidated Financial Statements and Notes
1. Consolidated Financial Statements(1) Consolidated Statement of Financial Position
Note

As of March 31,2023

As of March 31,2024

As of March 31, 2024

Millions ofyenMillions ofyen

Thousands of
U.S. dollars

AssetsCurrent assets
Cash and cash equivalents
8
Trade and other receivables
9, 34
Inventories
11
Other financial assets
10, 34
Other current assets
13
Total current assets
Non-current assets
Property, plant and equipment 14, 15, 17
Goodwill
16, 17
Other intangible assets
16, 17
Investments accounted for18
using equity method
Retirement benefit asset
22
Other financial assets
10, 34
Other non-current assets
13
Deferred tax assets
19
Total non-current assets
Total assets－

72,63978,999118,494
2,657
26,718299,507

100,645
87,897
103,910717
16,749309,918

664,719580,526
686,279
4,735
110,620
2,046,879

169,617
135,735
47,664

174,891
153,10749,5091,155,080
1,011,205
326,989

2,479

2,756

18,202

5,674
33,157
3,438
20,240418,003
717,5116,374
49,777
4,657
20,366
461,437
771,355

42,095
328,759
30,757
134,5123,047,599
5,094,478

2 －

Note

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

As of March 31,2023

As of March 31,2024

As of March 31,
2024

Millions ofyenMillions ofyen

Thousands of
U.S. dollars

21, 3420, 3423
20, 3424

20, 3422
23
20, 34
24
19

25
25
25
25
25

－

79,872
22,40762,510
3,046
1,474
3,243
9,410
181,962

79,714
19,31997,605
3,529
1,959
4,261
9,419
215,805

526,476
127,597644,638
23,30812,93528,141
62,2091,425,305

5,062
95,683
10,485
7,423
24,426
4,373
7,162
154,614336,576

2,679
81,465
10,045
7,359
37,574
2,775
11,210153,106
368,911

17,693538,040
66,341
48,603
248,162
18,32774,034
1,011,200
2,436,505

23,3706,637
288,919(2,109)38,70923,3706,748
276,992(1,961)70,646

154,351
44,565
1,829,414(12,955)
466,586

355,526

375,7942,481,962

25,409380,935
717,51126,650402,444771,355

176,0112,657,973
5,094,478

3 －(2) Consolidated Statement of Profit or Loss
Fiscal year ended
March 31, 2023

Fiscal year ended
March 31, 2024

Millions of yen

Millions of yen

408,880(265,792)
143,088(109,847)
7,071(11,029)404,631(269,767)
134,864(125,746)
2,730(8,294)

Thousands of
U.S. dollars
2,672,419(1,781,699)
890,720(830,500)
18,034(54,777)

18

87

94

621

6
6, 30
6, 30
6
19

29,3703,523(3,047)
29,846(13,427)

3,649
2,579
(6,352)(124)(4,349)24,09817,031(41,950)(821)(28,722)

16,419(4,473)(29,543)

15,784634
16,419(5,551)
1,078(4,473)(36,663)
7,120(29,543)(26.74)(26.74)

U.S. dollars(0.18)(0.18)

Note

Revenue
Cost of sales
Gross profit
Selling, general and administrative expenses
Other operating income
Other operating expenses
Share of profit of investments accounted forusing equity method
Operating profit
Finance income
Finance costs
Profit (loss) before tax
Income tax expense

6, 27

28
17, 2917, 29Profit (loss)

Fiscal year ended
March 31, 2024

Profit (loss) attributable to:
Owners of parent
Non-controlling interests
Total
Earnings (loss) per share
Basic earnings (loss) per share
Diluted earnings (loss) per share

Yen

Yen
75.56
75.47

32
32

－

4 －

(3) Consolidated Statement of Comprehensive Income

Note

Profit (loss)
Other comprehensive income
Items that will not be reclassified to
profit or loss
Net change in fair value of equity
instruments designated as measured atfair value through othercomprehensive income
Remeasurements of defined benefit
plans
Items that may be reclassified to profit
or loss
Effective portion of cash flow hedges
Exchange differences on translationof foreign operations
Share of other comprehensive incomeof investments accounted for using
equity method
Total other comprehensive income, net oftax
Total comprehensive income

Fiscal year ended
March 31, 2023

Fiscal year ended
March 31, 2024

Millions of yen

Millions of yen

Fiscal year ended
March 31, 2024

16,419(4,473)Thousands of
U.S. dollars(29,543)

31

(118)

10,74070,933

31

734

1,115

7,362

31

5

－

－

31

12,035

21,264140,441

31

414

188

1,239

13,07133,306219,975

29,48928,833

190,432

28,4791,010
29,48927,181
1,652
28,833

179,522
10,910190,432

Comprehensive income attributable to:
Owners of parent
Non-controlling interests
Total

－

5 －

(4) Consolidated Statement of Changes in Equity

Fiscal year ended March 31, 2023
(Millions of yen)
Equity attributable to owners of parent
Note

Balance at April 1, 2022

CapitalsurplusRetainedearnings

Treasuryshares23,37011,799333,335(18,874)

26,381--

15,784408
26

Purchase and disposal oftreasury shares
Transfer from othercomponents of equity toretained earnings
Proceeds from sale ofshares of subsidiaries
Changes in noncontroling interests
Other
Total transactions withowners, etc.
Balance at March 31, 2023

376,01138,728414,739

15,784634

16,41912,695

12,695376

13,071-

12,69528,4791,010

29,489

371

(0)

779

(14,793)

25

(549)

(45,913)

Noncontrolling Total equity
interests

Total

15,784

ProfitOther comprehensive
incomeTotal comprehensive
incomeShare-based paymenttransactions
Dividends

Share capital

Other
componentsof equity(14,793)
16,394

477

111
23

(800)

(15,593)(30,067)(30,067)

-

-

(477)

(5,021)

779-(13,518)(13,518)(4,911)(11)(4,922)28

28-(5,162)(60,200)

16,765(367)(48,964)(14,329)(63,294)

23,3706,637

288,919(2,109)38,709355,526

25,409380,935

Fiscal year ended March 31, 2024
(Millions of yen)
Equity attributable to owners of parent
Note

Balance at April 1, 2023
Profit (loss)
Other comprehensive
incomeTotal comprehensive
incomeShare-based paymenttransactions
Dividends
Purchase and disposal oftreasury shares
Transfer from othercomponents of equity toretained earnings
Other
Total transactions withowners, etc.
Balance at March 31, 2024

Noncontrolling Total equity
interests

Share capital

CapitalsurplusRetainedearnings

TreasurysharesOther
componentsof equity

23,3706,637

288,919(5,551)(2,109)38,709355,526(5,551)

25,4091,078

380,935(4,473)32,73332,733574

33,30632,733

27,181

1,652

28,833

115

225

-

-

(5,551)-

110
26(7,266)

25

(73)

Total

(7,266)
148

910

(910)

(21)

225
(408)

(7,674)

74

74

-

-

53

(3)

50

-

110

(6,376)

148

(795)

(6,914)(411)(7,325)23,3706,748

276,992(1,961)70,646

375,794

26,650402,444－

6 －Fiscal year ended March 31, 2024
(Thousands of U.S. dollars)
Equity attributable to owners of parent
Note

Balance at April 1, 2023

Sharecapital154,351

NonOther
Total
controlling
Capital Retained Treasury componen
equityTotalinterests
surplus earnings
sharests ofequity43,836 1,908,191 (13,931) 255,654 2,348,102 167,815 2,515,916

Profit (loss)
Other comprehensive
incomeTotal comprehensive
incomeShare-based paymenttransactions
Dividends
Purchase and disposalof treasury shares
Transfer from othercomponents of equity
to retained earnings
Other
Total transactions withowners, etc.
Balance at March 31,
2024(36,633)--(36,633)

-

729
26

(36,633)

7,120(29,543)

216,185

216,185

3,790

219,975

216,185

179,522

10,910190,432

756

1,486

(47,986)

25(47,986)

(485)

976
(6,009)6,009

154,351

485

(138)

729

(42,114)976

44,565 1,829,414(12,955)

－

7 －

1,486
(2,697)(50,682)

491

491

-

-

347

(17)

330

(45,662)(2,714)(48,376)

466,586 2,481,962

176,0112,657,973(5,253)

(5) Consolidated Statement of Cash Flows

Note

Fiscal year ended
March 31, 2023

Fiscal year ended
March 31, 2024

Millions of yen

Millions of yen

Fiscal year ended
March 31, 2024
Thousands of
U.S. dollars

Cash flows from operating activities
Profit (loss) before tax
Depreciation and amortization

29,84628,425(124)
33,514(821)
221,346

Interest and dividend income
Interest expenses
Share of loss (profit) of investments accounted
for using equity method
Impairment losses

(785)
3,047

(1,226)
6,352(8,095)41,950

(87)

(94)

(621)

17

7,801

7

(3,429)
2,274

2,191
－

14,470－(5,501)(36,329)(4,761)(5,895)20,994
8,117

138,655
53,609Other
Dividends received

(563)
474

(1,934)354(12,775)2,336Interest received
Interest paid

349
(3,420)－907(6,416)

5,991(42,375)(24,005)

7,570(4,705)49,998(31,076)

29,27059,998396,264

Loss (gain) on step acquisition
Decrease (increase) in trade and other receivables
Decrease (increase) in inventories
Increase (decrease) in trade and other payables

Income taxes refund
Income taxes paid
Net cash provided by (used in) operating
activities
Cash flows from investing activities
Net decrease in time deposits
Purchase of property, plant and equipment
Proceeds from sale of property, plant andequipment
Purchase of investments
Proceeds from sale of investments
Purchase of shares of subsidiaries resulting inchange in scope of consolidation
Proceeds from sale of shares of subsidiaries
resulting in change in scope of consolidation
Payments for loans receivableCollection of loans receivable(1,211)

1,975

13,042(31,202)(41,043)(271,073)

2,445

878

5,796

(1,745)
1,124(1,623)357(10,719)2,355

7(23,116)－－

12

51,160－－(1,792)
16

(30)
21

(201)
138

274

(714)

(4,715)(4,047)(40,181)(265,378)

Other
Net cash provided by (used in) investing activities
Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Net increase in commercial papers

20
20(13,183)
9,995

1,154
19,9907,622
132,024

Repayments of long-term borrowings
Proceeds from long-term borrowings

20
20(9,543)
26,768Proceeds from issuance of bonds
Purchase of treasury shares

20
25

24,872(30,137)(6,334)234－(41,834)
1,545
－

(6)

(41)

26

(14,791)(781)(7,271)(410)(48,021)(2,706)

7(4,922)－－20(3,744)262(4,112)
183(27,161)
1,211(15,203)

3,428

22,640

Dividends paid
Dividends paid to non-controlling interests
Purchase of shares of subsidiaries not resulting inchange in scope of consolidation
Repayments of lease liabilities
Other
Net cash provided by (used in) financing
activities－

8 －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 included in assets
associated with disposal groups classified as held for 12
sale
Cash and cash equivalents at end of period
8

－

9 －

628

4,761

31,446

10,64845,56728,007
72,639184,972
479,748

16,424－－

72,639100,645664,719

2. Notes of Consolidated Financial Statements(1) Reporting Entity
JSR Corporation (the “Company”) is incorporated in Japan. The consolidated financial statements comprise thefinancial statements of the Company and its subsidiaries (collectively, the “Group”) together with the Group’s
attributable share of the results of associates and joint ventures. The Group is primarily engaged in the Digital
Solutions Business, the Life Sciences Business and the Plastics Business as well as businesses related to these.
The products of these businesses are wide ranging. See the note “(6) Segment Information” for further details.
(2) Basis of Preparation
1) Compliance with Accounting Standards
The Group meets the requirements of a “specified company” set forth in Article 1-2 of the “Ordinance on
Consolidated Financial Statements.” Accordingly, the Group prepares consolidated financial statements inaccordance with IFRS pursuant to the provisions of Article 93 of the said Ordinance.
2) Presentation Currency and Units
The Group’s consolidated financial statements are presented in Japanese yen, the currency of the primaryeconomic environment in which the Company performs business activities (the “functional currency”), withamounts rounded to the nearest million yen.
The translation of the amounts in Japanese yen into US dollars is included solely for the convenience of readers
outside Japan, using the prevailing exchange rate on March 31, 2024, which was ¥151.41 to $1.00. The amounts
translated should not be construed as representations that the amounts in Japanese yen have been, could havebeen, or could in the future be, converted into US dollars at this or any other rates of exchange.
3) Authorization of Consolidated Financial Statements
The consolidated financial statements have been authorized by Eric Johnson, the Company’s representative
director, CEO and president, and Ken-ichi Emoto, the Company’s CFO, on June 28, 2024.
(3) Explanation of New Standards and Interpretations Not Applied
Of the major new or revised standards and interpretations published prior to the date of authorization of theconsolidated financial statements, the Group is not applying the following standards at the end of the current fiscal
year because their application is not yet mandatory.
Standard

Name of Standard

IFRS 18

Presentation andDisclosure in Financial
Statements

Mandatory
Effective Date
January 1, 2027

The Group’s
Application Timing

Summary of New/Revised Standard

Reporting period

New establishment of presentation and disclosurein Statement of Profit or Loss to improveending March 2028

financial performance reporting

IFRS 18 primarily includes new provisions concerning the presentation and disclosure of financial
performance in Statement of Profit or Loss. IAS 7 "Statement of Cash Flows" was revised in conjunction
with the publication of IFRS 18. The effect of the adoption of these provisions on the consolidated financial
statements is under review.
(4) Significant Accounting Policies
The significant accounting policies that have been applied to the consolidated financial statements are as follows
and are identical to those applied to all periods stated in the consolidated financial statements.
1) Basis of Consolidation(i) Subsidiaries
Subsidiaries refer to all entities controlled by the Group. The Group is deemed to have control over an entity
if it has exposure or rights to variable returns from its involvement in the entity and has the ability to use its
power over an entity to affect such returns. The financial statements of subsidiaries are included in theGroup’s consolidated financial statements from the date the Company gains control until the date it loses
control of the subsidiary.
In cases where the accounting policies applied by a subsidiary are different from those applied by the Group,
adjustments are made to the subsidiary’s financial statements, if necessary. All intergroup balances of－

10 －payables and receivables, internal transactions and unrealized gains or losses arising from transactions
within the Group are eliminated in preparing the consolidated financial statements.
When the Company retains control when there has been partial disposal of ownership interest in a
subsidiary, the partial disposal is accounted for as an equity transaction. Any difference between the amountby which the non-controlling interests are adjusted and the fair value of the consideration paid or received isrecognized directly in equity attributable to Owners of the parent company.
If the Company loses control over the subsidiary, gains or losses derived from such loss are recognized as
profit or loss.
When the fiscal year-end of a subsidiary is different from the end of the reporting period of the Group, theCompany uses financial statements of the subsidiary based on the provisional accounting as of the end of thereporting period of the Group.
(ii) Associates
Associates are entities over which the Group has significant influence but does not have control over thefinancial and operating policies. The equity method is applied to all associates from the date on which theGroup acquires significant influence to the date on which it loses the significant influence.
Goodwill recognized on acquisition (less accumulated impairment losses) is included in investments inassociates.
In cases where the accounting policies applied by an associate are different from those applied by the Group,
adjustments are made to the associate’s financial statements, if necessary.
(iii) Joint Ventures
A joint venture is an entity jointly controlled by two or more parties including the Group under thecontractually agreed sharing of control over economic activities of the joint venture, which exists only when
decisions for strategic financial and operating decisions related to relevant activities require unanimous
consent of the parties sharing control.
Joint ventures of the Group are accounted for using the equity method.
In cases where the accounting policies applied by a joint venture are different from those applied by theGroup, adjustments are made to the joint venture’s financial statements, if necessary.
2) Business Combinations
The Group takes in account business combinations using the acquisition method.
The aggregate of the consideration paid for a business combination measured at fair value on the acquisition
date and the amount of non-controlling interests in the acquired entity are taken as the acquisition costs basedon the acquisition method.
Non-controlling interests are measured at equivalent amount for the fair price of the acquired entity’s
identifiable net assets and liabilities in proportion to the share of the non-controlling interest.
Ancillary costs incurred relating to business combination such as brokerage fees, attorney’s fees, due diligencecosts, other professional fees, consulting fees, as well as other acquisition-related costs are recognized as
expenses in the periods in which such costs are incurred.
If the initial accounting for the business combination has not been completed by the closing date of the reporting
period in which the business combination took place, such incomplete items are measured at provisional basedon the best estimate.
If the new information obtained during the measurement period, which lasts for a year from the acquisition date,affects the measurement of the amount recognized on the acquisition date, the provisional recognized on theacquisition date is retrospectively revised.

－

11 －

In the event that the aggregate amount of fair value of the consideration paid in relation to the businesscombination, the amount of non-controlling interests in the acquired entity, and the fair value of equity interestson the control commencement date in the acquired entity previously held by the acquiring entity exceeds the
net value of identifiable assets and liabilities at the acquisition date, the excess amount is recognized as goodwill.
If, on the other hand, such aggregate amount does not exceed the net value of identifiable assets and liabilities
at the acquisition date, the difference is recognized in profit or loss. Additional acquisitions of non-controllinginterests after the controlling acquisition are accounted for as capital transactions and are not recognized as
goodwill from the original transaction.
3) Foreign Currency Translation(i) Functional Currency and Presentation Currency
The Group’s consolidated financial statements are presented in Japanese yen, which is the Company’sfunctional currency. The Group’s foreign operations generally use the local currency as their functional
currency, but if any currency other than the local currency is primarily used in the economic environment inwhich the entity operates, such currency is used as the entity’s functional currency.
(ii) Foreign Currency Transactions
Foreign currency transactions, meaning transactions conducted in a currency other than the respective entity’sfunctional currency, are translated into the functional currency either by using the exchange rates prevailingat the date of the transaction or using an average rate when there are no material fluctuations in exchange rates.
Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency
at the exchange rates prevailing at the reporting date, and exchange differences are recognized in profit or loss
in principle.
(iii) Foreign Operations
The assets and liabilities (including goodwill arising from acquisitions and adjustments of fair value) of foreign
operations that use a currency other than Japanese yen as their functional currency are translated into Japanese
yen at the exchange rates prevailing at the reporting date. The revenues and expenses of foreign operations aretranslated into Japanese yen at the average rates of exchange over the reporting period, unless there arematerial fluctuations in exchange rates. Exchange differences arising from such translations in foreign
operations’ financial statements are recognized in other comprehensive income, and are included andaccounted for in other components of equity.
4) Cash and Cash Equivalents
Cash and cash equivalents comprise cash in hand, deposits that can be withdrawn as needed, and short-term
investments that are easily converted into cash with minimal risk of changes in value.
5) Inventories
Inventories are measured at the lower of cost or net realizable value. Cost of inventories is calculated based on
the weighted-average cost formula. Net realizable value is the estimated selling price of inventories in theordinary course of business, less the estimated costs of completion and estimated selling expenses. Inventories
and work in process manufactured by the Company include the amounts of manufacturing overhead
appropriately allocated based on the ordinary operating rate.
6) Property, Plant and Equipment （Excluding Right-of-use Assets）
The cost model has been adopted, and all property, plant and equipment are measured at cost less any
accumulated depreciation and accumulated impairment losses. Cost includes costs directly attributable to theacquisition of the assets, and the present value of the estimated costs of removal of the assets and site restoration.
Furthermore, borrowing costs that satisfy certain conditions directly attributable to the acquisition, construction,etc., of the assets are recognized as part of the cost of the assets.
Depreciation expenses are recognized using the straight-line method over the estimated useful life of each asset
to depreciate the cost less the residual value of the asset. The estimated useful lives, residual values, anddepreciation methods are reviewed at the end of the reporting period. In the event of the modification inestimates, impacts therefrom are recognized in the accounting period in which the estimates were modified andin the future accounting periods.
The estimated useful lives of major assets are as follows:－

12 －• Buildings and structures: 10 to 50 years• Machinery, equipment, and vehicles: 4 to 8 years• Tools, furniture, and fixtures: 3 to 10 years7) Intangible assets(i) R&D expenses
Research-related expenditures are recognized as expenses when they are incurred. Development-related
expenditures are capitalized as intangible assets only when all of the following conditions are satisfied: theamount for such expenditures can be reliably measured; the products or the processes to be developed
therefrom are technically and commercially viable; there is a high probability of generating future economic
benefits; and the Group intends to complete the development and use the process or the products therefrom aswell as sufficient resources to make them feasible. All other expenditures are recognized as expenses when
they are incurred.
(ii) Goodwill
The measurement of goodwill at initial recognition is stated in “2) Business combinations.” The Group does
not amortize goodwill, but tests for impairment every fiscal year. Impairment of goodwill is stated in “8)Impairment of non-financial assets.” Impairment losses of goodwill are recognized as profit or loss and notreversed subsequently.
After the initial recognition, goodwill is presented at cost less accumulated impairment losses.
(iii) Intangible Assets Acquired as a Result of a Business Combination
Cost of intangible assets acquired as a result of a business combination is measured at fair value on theacquisition date.
Intangible assets acquired as a result of a business combination are accounted after initial recognition at costless any accumulated amortization and accumulated impairment losses, which are amortized using the straightline method over the estimated useful life of each asset.
The estimated useful life of major assets is as follows:• Technology-based intangible assets: 5-25 years(iv) Intangible Assets Acquired Individually
Other intangible assets acquired individually inclusive of software, etc., are accounted at cost less any
accumulated amortization and accumulated impairment losses, which are amortized using the straight-line
method over the estimated useful life of each asset.
The estimated useful life of a major asset is as follows:• Software: 5-10 years8) Impairment of Non-financial Assets
The Group assesses its non-financial assets, excluding inventories and deferred tax assets at the end of eachreporting period to identify any indications of a potential inability to recover the carrying amount due tochanges in such assets or circumstances. If any such indication exists, impairment testing is conducted.
If the carrying amount of an asset exceeds its recoverable amount, the difference is recognized as impairment
loss.
The recoverable amount of an asset is the higher of the fair value less costs of disposal and the value in use. In
calculating the value in use, the estimated future cash flows from the asset are discounted to the present value
using a discount rate that reflects the time value of money and the inherent risks of the asset. For the purposesof determining impairment, assets are grouped into an individual asset or the smallest asset group (cashgenerating unit) generating cash inflows that are largely independent of the cash flows of other assets.
Goodwill is tested for impairment once a year periodically, regardless of whether any indications of impairment
exist, and the cost at the time of acquisition less any accumulated impairment losses is recognized as the
carrying amount.
In the case of property, plant and equipment and intangible assets, excluding goodwill, for which impairment－

13 －losses have been recognized in prior years, an assessment is conducted at the end of each reporting period todetermine if there are any possibilities of reversal of such impairment losses.
9) Financial Instruments(9.1) Financial Assets(i) Initial Recognition and Measurement
The Group initially recognizes financial assets on the date when it becomes a party to the contract on thefinancial instruments concerned. Financial assets bought or sold by ordinary methods are initially recognizedon the transaction date. Financial assets are subsequently classified into those measured at amortized cost or
those measured at fair value.
Financial assets measured at fair value through profit or loss are initially measured at fair value. Financial
assets measured at fair value through other comprehensive income and financial assets measured atamortized cost are initially measured at fair value plus transaction costs that are directly attributable to theacquisition of the financial asset. Additionally, trade receivables that do not include significant financing
components are initially measured at the transaction price.
(a) Financial assets measured at amortized cost
Financial assets are classified as those measured at amortized cost only when both of the following
conditions are satisfied; the asset is held within a business model whose objective is to hold assets inorder to collect contractual cash flows; and the contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of principal and interest on the principal amountoutstanding.
(b) Financial assets measured at fair value
Financial assets are classified as those measured at fair value if they fail to meet either of the two
requirements given above.
Of these assets, financial assets that generate, on specified dates, cash flows that are solely payments
of principal and interest on the principal amount outstanding and are held within a business model
whose objective is achieved both by collecting contractual cash flows and by selling the assets areclassified as debt financial assets measured at fair value through other comprehensive income.
Moreover, for certain equity financial assets, the Group has made an irrevocable election to present
subsequent changes in fair value in other comprehensive income and to classify these assets as equity
financial assets measured at fair value through other comprehensive income.
Financial assets such as derivative assets, other than the above assets, are classified as financial assets
measured at fair value through profit or loss.
(ii) Subsequent Measurement
After initial recognition, financial assets are measured according to their classification as follows:(a) Financial assets measured at amortized cost
Measured at amortized cost using the effective interest method(b) Financial assets measured at fair value
Measured at fair value on the reporting date
Any changes in the fair value of financial assets are recognized in profit or loss or in othercomprehensive income according to their respective classification of the financial asset. Dividends
received from designated equity instruments measured at fair value through other comprehensive
income are recognized in profit or loss. If the fair value of the equity instrument depreciates materiallyor if the equity instrument is disposed of, any accumulated other comprehensive income or loss isreclassified to retained earnings.
(iii) Derecognition－

14 －Financial assets are derecognized when the contractual rights to the cash flows from the investment expire
or when the contractual rights to the cash flows from the investment are assigned and substantially all therisks and rewards of the Group’s ownership of such financial assets are transferred.
(9.2) Financial Liabilities(i) Initial Recognition and Measurement
The Group initially recognizes financial liabilities on the contract date. Financial liabilities are initiallymeasured at fair value less transaction costs that are directly attributable to the acquisition of the financial
liability.
(ii) Subsequent Measurement
After initial recognition, financial liabilities are measured according to their classification as follows:(a) Financial liabilities measured at amortized cost
Measured at amortized cost using the effective interest method(b) Financial liabilities measured at fair value through profit or loss
Financial liabilities measured at fair value through profit or loss, which include those designatedfinancial liabilities measured at fair value through profit or loss, are measured at fair value.
(iii) Derecognition
Financial liabilities are derecognized when contractual obligations are discharged, cancelled, or expired.
(9.3) Offsetting Financial Instruments
Financial assets and liabilities are offset if and only if: there is a legally enforceable right to set off therecognized amount of financial assets against the recognized amount of financial liabilities; there is the intent
either to settle on a net basis or to realize assets and settle liabilities simultaneously.
10) Impairment of Financial Assets
The Group estimates expected credit losses as of the reporting date for financial assets measured at amortized
cost.
If the credit risk has not increased materially from initial recognition, the 12-month expected credit loss isrecognized as a loss allowance. In the case of trade receivables that do not include significant financial
components, however, the loss allowance is always measured at lifetime expected credit loss. If the credit risk
has increased materially from initial recognition, the lifetime expected credit loss is recognized as a loss
allowance. Judgment as to whether or not a material increase in credit risk has occurred from the initialrecognition is based on the degree of changes in default risk. When the Group judges whether or not there arematerial changes in default risk, it reviews the information on the past due status as well as the following factors;• External credit grades of the financial asset• Internal credit grades• Results of operations of the borrower• Financial assistance from the parent company, etc. of the borrower
Expected credit losses are measured as weighted average of the present value of the difference between allcontractual cash flows that are due to the entity in accordance with the contract and all cash flows that theentity expects to receive, weighted by respective risks of default occurring. The Group treats any financial
asset as a credit-impaired financial asset in cases where the financial asset is considered to have defaulted,
including cases where the financial asset is significantly past due even after enforcement activities for the
performance of obligations are taken and where the debtor files legal proceedings for bankruptcy, corporate
reorganization, civil rehabilitation or special liquidation. The Group presents the financial assets measured atamortized cost at the net amount that the loss allowance is deducted from the carrying amount in the
consolidated statement of financial position and recognizes the loss as profit or loss.
When the Group has no reasonable expectations of recovering all or part of a financial asset, the carrying amountof the asset is directly written off by that amount.
11) Derivatives and Hedge Accounting
Derivatives are initially recognized at fair value at the date on which the derivative contract is entered into andare subsequently remeasured at their fair value at the end of each reporting period after initial recognition. The－

15 －method of recognizing the resulting gain or loss depends on whether or not the derivative is designated as ahedging instrument, and if so, the nature of the item being hedged.
The Group designates certain derivatives as hedging instruments of cash flow hedges (hedges of a particularrisk associated with a recognized asset or liability, or a highly probable forecast transaction), and certain
foreign currency borrowings as hedging instruments of net investment in foreign operations.
The Group documents, at the start of the transaction, the relationship between hedging instruments and hedged
items as well as the objectives and strategies for managing risk regarding the execution of their hedging
transactions. Furthermore, the Group documents at the start of the hedge, and on a continuing basis,
assessments of whether or not the derivatives used in the hedging transaction are effective in offsetting changes
in the hedged items’ cash flow.
Hedge effectiveness is assessed on a continuing basis, and a hedge is deemed effective when it satisfies all of
the following conditions: an economic relationship exists between hedged items and hedging instruments; theeffect of credit risk is not such that it materially dominates value changes arising from the economic
relationship; and the hedge ratio of the hedging relationship is equivalent to the ratio arising from the volumeof hedging instruments and hedged items that are actually being hedged.
The effective portions of change in the fair values of derivatives designated as hedging instruments of cash
flow hedges and satisfying the conditions thereof are recognized in other comprehensive income. Gains orlosses arising from ineffective portions are recognized immediately as profit or loss. Accumulated gains orlosses recognized through other comprehensive income are reclassified to profit or loss in the period when the
cash flow originating from the hedged items has an effect on profit or loss.
When hedge accounting conditions are no longer satisfied due to forfeit, sale, etc., of hedging instruments,
hedge accounting will no longer be applied prospectively. When hedged future cash flow is expected to occur
again, the accumulated gains or losses recognized in other comprehensive income will continue to be recognized as other components of equity. In cases where forecast transactions are no longer expected to occur,
the accumulated gains or losses recognized in other comprehensive income are reclassified immediately to
profit or loss.
With regard to certain foreign currency borrowings that are retained for the purpose of hedging exposure to
exchange rate fluctuation risks for net investments in foreign operations, the portion of foreign exchange
differences deemed effective as a hedge is recognized in other comprehensive income as hedges of net
investment in foreign operations. Of exchange differences in the hedging instruments, any ineffective portionof the hedge or any portion of the hedge not subject to the assessment of hedge effectiveness is recognized in
profit or loss.
Through net investment hedges, the cumulative amount of gain or loss recognized in other comprehensive
income is reclassified to profit or loss on the disposal of foreign operations.
12) Leases
At inception of a contract, the Group assesses whether the contract is, or contains, a lease based on whether
the contract conveys the right to control the use of an identified asset for a period of time in exchange forconsideration. The Group elects not to recognize right-of-use assets and lease liabilities for short-term leases
within 12 months and leases of low-value assets.
Apart from short-term leases or leases of low-value assets, the group records right-of-use assets and leaseliabilities in the consolidated statement of profit or loss at the lease commencement date when a contract is,or contains a lease. The lease payments associated with short-term leases and leases of low-value assets arerecognized as an expense on a straight-line basis over the lease term.
Right-of-use assets are measured under the cost model and are stated at cost less accumulated depreciation
and accumulated impairment losses.
The cost of right-of-use assets is initially measured based on the initial measurement amount of the leaseliability adjusted for any initial direct costs incurred or any lease payments made at or before thecommencement date, plus any costs to restore the underlying asset or the site at which it is located and otherrelated costs required in the lease contract. Right-of-use assets are depreciated over the lease term on a－

16 －

straight-line basis. Right-of-use assets are recorded in Property, plant and equipment on the current
Consolidated Statement of Financial Position. Lease liability is measured at the present value of unpaid lease
payments at the calculated interest rate of the lease or when the calculated interest rate cannot be easily
calculated, discounted by the incremental borrowing rate. Generally, the Group uses the incremental
borrowing rate as the discount rate. Lease payments are apportioned between finance costs and repaymentsof lease liability under the effective interest rate method. Finance costs are recognized in the consolidated
statement of profit or loss.
13) Employee Benefits(i) Short-term Employee Benefits
Short-term employee benefits are recognized as an expense in the period in which the employee renders therelated service without discounting. Bonus payments are recognized as liabilities in the amount estimated tobe paid based on the applicable bonus payment system when there is a legal or constructive obligation to pay
and the obligation can be estimated reliably.
(ii) Long-Term Employee Benefits
The Group has adopted defined contribution plans and defined benefit plans as post-employment benefit plansfor employees.
Liabilities (assets) recognized in connection to defined benefit pension plans are calculated at the present valueof defined benefit obligations under such plans at the end of the reporting period less the fair value of the plan
assets. An independent specialist calculates the defined benefit obligations for each reporting period using the
projected unit credit method. Any amount recognized as assets from this calculation is limited to the present
value of any future economic benefit available in the form of refunds from the plans or reductions in futurecontributions to the plans when there is a possibility for the assets to generate these to the Group. Calculationsof the present value of economic benefits take into consideration the minimum funding requirement. The
present value of defined benefit obligations is calculated by discounting the estimated future cash flows inreference to market yields on high-quality corporate bonds that pay benefits and with maturities similar to theestimated timing of payment of the obligations.
Changes due to remeasurements of net defined benefit liabilities (assets) that were recognized in othercomprehensive income in the period they occurred are immediately reclassified from other comprehensive
income to retained earnings.
Defined contribution plans are post-employment benefit plans under which an employer pays fixed
contributions to an independent entity and has no legal or constructive obligation to pay further contributions.
Contribution obligations under the defined contribution plans are recognized as an expense in the period inwhich the employee renders the related service.
(ⅲ) Termination benefits
The Group pays termination benefits when the Group ends an employee's employment before the normal
retirement date, or when the employee accepts an offer of benefits in exchange for the termination of
employment. The group recognise a liability and expense for termination benefits at the earlier of the following
dates: (a) when the group cannot withdraw the offer of those benefits; and (b) when the group recognises costs
for a restructuring that involves the payment of termination benefits.
14) Non-current Assets Held for Sale and Discontinued Operations
A non-current asset or disposal group is classified as held for sale if its carrying amount will be recovered
principally through a sale transaction rather than through continued use.
The conditions for classifying an asset or disposal group as held for sale are that it must be available for
immediate sale in its present condition and the sale must be highly probable. The classification is also limited towhen management of the Group is committed to executing the sale plan and the sale is generally expected tocomplete within one year. After classification as held for sale, an asset or disposal group is measured at the lowerof the carrying amount and the fair value less costs to sell, and is not depreciated or amortized.
A discontinued operation includes a component of the Group that either has been disposed of or is classified asheld for sale, represents a line of business or geographical area of the Group, and is recognized when there is aplan to dispose of that line of business or geographical area.
－

17 －15) Provisions
Provisions are recognized if the Group has a present legal or constructive obligation as a result of a past eventthat can be estimated reliably and it is probable that an outflow of resources will be required to settle theobligation.
When the time value of money is significant, the estimated future cash flow is discounted by the present value
using a before-tax discount rate that reflects the time value of money and inherent risks of the liability. Transferbacks of the discounted amount over time are recognized as finance costs.
16) Share Capital
The issue price of equity instruments issued by the Company is recognized in share capital and capital surplus,and direct issue costs (net of tax effects) are deducted from capital surplus.
On the purchase of treasury shares, costs net of tax effects including direct transaction costs are recognized as
an equity deduction. On the sale of treasury shares, including disposal of treasury shares with the exercise ofstock options, the balance of disposals is recognized as capital surplus. Common shares are classified to equity.
17) Share-based Remuneration Plans(i) Stock Options
The Group operated an equity-settled share-based remuneration plan where the Group received services fromdirectors, executive officers, and employees as well as paid equity instruments (options) as consideration
thereof until June 2017
The fair value on the date the option was granted under the plan is recognized as an expense over the option’s
vesting period and the same amount is recorded as an increase in equity. The plan was terminated in June2017 (however, of share acquisition rights as share-based stock options that were already granted to directors,
etc., those share acquisition rights which have not been exercised will be continued).
(ii) Restricted Share-based Remuneration Plan
The Company has adopted the restricted share-based remuneration plan for its directors and others as aperformance-linked remuneration plan and applied the accounting treatment for equity-settled share-basedplans under this plan.
Fair value of the share-based remuneration is determined using the fair value of ordinary shares on the grant
date. The fair value is recognized as an expense over the share’s vesting period, and the same amount isrecorded as an increase in equity.
(iii) Performance Share Unit Remuneration Plan
The Company has adopted a Performance Share Unit Remuneration plan for directors and executive officersof the Company and officers of certain subsidiaries of the Company, under which the number of shares to bedelivered and the amount of individual cash payments are adjusted according to the attainment level ofpredetermined performance targets, and applied cash-settled share-based payment transactions and equitysettled share-based payment transactions under this plan.
Expenses related to the cash-settled payment transactions are recognized over the applicable period and thesame amounts are recognized as an increase in liabilities.
Expenses related to the equity-settled payment transactions are calculated using the fair value of common
stock at the grant date and are recognized over the applicable period and the same amounts are recognized
as an increase in equity.
18) Revenue Recognition
The Group recognizes revenue by applying the following five steps, apart from interest and dividend income
accounted for in accordance with IFRS 9 — Financial Instruments.
Step 1: Identify the contract with a customer.
Step 2: Identify the performance obligations in the contract.
－

18 －Step 3: Determine the transaction price.
Step 4: Allocate the transaction price to performance obligations.
Step 5: Recognize revenue when (or as) the Group satisfies a performance obligation.
In case of sales contracts with customers for products and merchandise, the Group recognizes the sale as revenue
when the products and merchandise are delivered to the customer, considering that control of the products andmerchandise is transferred to the customer and the performance obligation is fulfilled. For rendering of services,
the Group recognizes revenue over time with fulfillment of performance obligation based on the contract
between the Group and the customer.
19) Government Grants
Government grants are recognized when there is reasonable assurance that the Group will comply with theconditions attached to the grant and that the grant will be received. Government grants are recognized in profit
or loss on a systematic basis over the period the associated costs, which the grant is intended to compensate, arerecognized as expenses.
For government grants associated with acquiring assets, the amounts of the grants are deducted directly whencalculating the carrying amounts of the assets. Grants are recognized in profit or loss over the useful lives of thedepreciated assets as changes in depreciation expense.
20) Finance Income and Finance Cost
Finance income comprises interest received, dividends received, etc. Interest received is recognized when it
incurred using the effective interest method. Dividends received are recognized when the Group’s rights toreceive dividends have been established; there is a high probability that the economic benefits associated withthe dividends will flow into the Group; the amounts can be measured reliably.
Finance cost comprises interest paid, etc.
With respect to an asset that necessarily takes a substantial period of time to get ready for its intended use or
sale, borrowing costs that are directly attributable to the acquisition, construction or manufacture of the asset
form part of the cost of that asset. All other borrowing costs are recognized as an expense in the period in which
they are incurred.
21) Income Taxes
Income taxes comprise current taxes and deferred taxes. They are recognized in profit or loss, with the exceptionof income taxes associated with items recognized in other comprehensive income or items that are directly
recognized in equity.
(i) Current Taxes
The Group recognizes current taxes based on taxable profits for the reporting period. Current tax amounts
are calculated using the tax rates that are in force or substantially in force on the final day of the reporting
period. Income taxes receivable and payable are measured at the estimated refund from or payment to thetax authorities.
(ii) Deferred Taxes
The Group recognizes deferred taxes using the asset and liability approach for temporary differences
between the amounts of assets and liabilities for accounting purposes and their tax bases. In principle,
deferred tax liabilities are all recognized in taxable temporary differences, and deferred tax assets arerecognized only to the extent it is probable that there will be taxable profits against which deductible
temporary differences, tax losses, etc., may be utilized. Deferred tax assets and liabilities, however, are notrecognized for the following temporary differences:• Taxable temporary differences arising from initial recognition of goodwill;• Temporary differences arising from initial recognition of assets or liabilities in transactions (excluding
business combinations) that do not affect taxable profits (tax losses) in profit or loss for accounting
purposes; and• Taxable temporary differences pertaining to investments in subsidiaries and associates where the timing－

19 －of the reversal of the temporary differences can be controlled by the Group and it is probable that thetemporary differences will not reverse in the foreseeable future.
Deferred tax assets pertaining to deductible temporary differences associated with investments in
subsidiaries and associates are recognized only to the extent that the temporary difference will reverse in theforeseeable future and that it is probable that there will be adequate taxable profits against which benefits
from the temporary difference can be utilized.
Deferred tax assets and liabilities are calculated at the tax rates expected to apply to the period when theassociated deferred tax assets will be realized or the period when the deferred tax liabilities will be settled,based on the tax rates that are in force or substantially in force at the end of the reporting period.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax
assets against current tax liabilities and when the deferred tax assets and liabilities are associated with theincome taxes levied on the same taxable entity, or the equivalent or different taxable entity intended to besettled on a net basis, by the same tax authority.
22) Earnings per Share
Basic quarterly earnings per share are calculated by dividing profit for the quarter attributable to ordinary
shareholders by the weighted-average number of common shares outstanding during the reporting period.
Diluted quarterly earnings per share are calculated through adjustments for the effect of all potentially dilutive
common shares.

－

20 －

(5) Significant Accounting Estimates and Judgments Involving Estimates
In the preparation of consolidated financial statements, management is required to make judgments, estimates,
and assumptions.
The estimates and the underlying assumptions are reviewed on an ongoing basis, and the effects of the review
are recognized in the period in which the review was conducted and in future periods.
Actual results may differ from these estimates.
Estimates and judgments that have significant effects on amounts recognized in the Group’s consolidated
financial statements are as follows. These assumptions have been determined based on management’s best
estimates and judgments. However, the assumptions may be affected by results of uncertain changes in
economic conditions in the future and amendment or promulgation of related laws and regulations, and if a
review is necessary, this may have significant effects on amounts recognized in consolidated financial
statements in the following fiscal years.
1) Impairment of Non-Financial Assets
In the calculation of recoverable amount in impairment test, certain assumptions have been made for future
cash flows, discount rate reflecting risks inherent to the asset, long-term growth rate and others. Details of
the method for calculating recoverable amount, etc. are provided in the note “(17) Impairment of NonFinancial Assets.”
2) Recoverability of Deferred Tax Assets
For the recognition of deferred tax assets, the amount is determined, assuming the probability that there will
be taxable profits, by estimating the timing when taxable profits that can be obtained in the future areavailable and the amount of these profits based on the business plan. The relevant content and amount ofdeferred tax assets are provided in the note “(19) Income Taxes.”

－

21 －

(6) Segment Information
1) Overview of Reportable Segments
JSR Group’s reportable segments are based on its business segments for which separate financial information
is available and which the Board of Directors determines are the basis that are subject to regular reviews for
decisions on the allocation of managerial resources and the evaluation of business results.
The Group has established divisions by product at its head office. Each division formulates comprehensive
domestic and overseas strategies for its products and conducts business activities according to the strategies.
Core Group companies also take the initiative in working out comprehensive domestic and overseas strategies
and conduct business activities according to the strategies. Thus, JSR Group’s businesses consist of businesssegments by product based on divisions and core Group companies.
The Group has three reportable segments. The Digital Solutions Business manufactures and sells
semiconductor materials, display materials, and products related to edge computing , etc. The Life Sciences
Business provides diagnostic and research reagents and materials, bioprocess materials, and drug discovery
and development services. The Plastics Business manufactures and sells ABS and other resins for automobiles
office equipment, and amusement applications.
The Digital Solutions Business is a reportable segment comprising multiple segments based on the nature of
the products and services, the nature of production processes, and similarity in markets and other economic
characteristics.
The accounting methods for reportable segments are the same as the methods adopted for the preparation of
consolidated financial statements.
Main Products in Each Business Segment
Business segments
Digital Solutions
Business
Life Sciences
Business
Plastics Business

Main products<Semiconductor Materials> Lithography materials (photoresists, multilayer materials);mounting materials; Cleaning Solution; CMP materials; etc.
<Display Materials> Materials for color LCDs; functional coating materials; etc.
<Edge Computing Materials> Heat-resistant transparent resins and functional films; photofabrication and photo molding systems; etc.
Diagnostic and research reagents and similar materials; bio-process materials; drug
discovery and development services etc.

Synthetic resins including ABS resins, AES resins, AS resins, and ASA resins

－

22 －

2) Segment Revenues, Profits or Losses, Assets and Other Material Items
The following information pertains to the Group’s reportable segments.
Fiscal year ended March 31, 2023 (April 1, 2022 to March 31, 2023)(Millions of yen)
The Reportable Segment
DigitalLife Sciences
Solutions
Revenue from

Other
[Note 1]

Plastics

Total

AmountRecorded in the
Adjustment
Consolidated[Note 2]Financial
Statements

170,439

126,478

95,802

16,162408,880-

408,880

27,790

8,450

1,853

441

38,534(4,510)34,025

267,733

271,240

76,71318,504

634,191

83,320717,511

Depreciation andamortization

11,475

11,7202,800

807

26,802

1,623

28,425

Impairment losses

7,801

-

-

-

7,801

-

7,801

Capitalexpenditures

20,154

15,873

3,253

4,546

43,826392

44,218external customers
Segment profit (loss)(core operating
profit)[Note 3]
Segment assets
Other items

Note 1: The Other segment is a business segment not contained in the reportable segments. It includes thepurchase and sale of chemicals and other businesses.
Note 2: The segment profit (loss) downward adjustment of (4,510) million yen contains company-wide profits
and losses not allocated to the reportable segments. The adjustment amount in the segment assets line arecompany-wide corporate assets not allocated to any reportable segment. Corporate assets mainly include
investment of surplus funds (deposits, cash equivalents, and securities (debt instrument assets)) and longterm investment funds (securities (equity instrument assets)) by the parent company.
Note 3: The segment profit (loss) is presented as core operating profit after deducting non-recurring profit (loss)
arising from business restructuring and other non-recurring factors from operating profit.

－

23 －

Fiscal year ended March 31, 2024 (April 1, 2023 to March 31, 2024)(Millions of yen)
The Reportable Segment
DigitalLife Sciences
Solutions
Revenue from

Plastics

Other[Note 1]

Total

AmountRecorded in the
Adjustment
Consolidated[Note 2]Financial
Statements

168,115

129,693

92,832

13,991

404,631－404,631(core operating profit)[Note 3]

20,272(7,739)

1,460

131

14,124(5,780)8,345

Segment assets

283,262272,297

84,661

16,651

656,870

114,485

771,355

Depreciation andamortization

12,61315,802

2,774

702

31,8901,624

33,514

Impairment losses

－

1,080

－

－

1,080

1,111

2,191

11,77812,8573,490

790

28,9152,680

31,595external customers
Segment profit (loss)

Other items

Capitalexpenditures

Note 1: The Other segment is a business segment not contained in the reportable segments. It includes thepurchase and sale of chemicals and other businesses.
Note 2: The segment profit (loss) downward adjustment of (5,780) million yen contains company-wide profits
and losses not allocated to the reportable segments. The adjustment amount in the segment assets line arecorporate assets not allocated to any reportable segment. Corporate assets mainly include investment of
surplus funds (deposits, cash equivalents, and securities (debt instrument assets)) and long-term
investment funds (securities (equity instrument assets)) by the parent company.
Note 3: The segment profit (loss) is presented as core operating profit after deducting non-recurring profit (loss)
arising from business restructuring and other non-recurring factors from operating profit.

－

24 －

Fiscal year ended March 31, 2024 (April 1, 2023 to March 31, 2024)(Thousands of U.S. dollars)
The Reportable Segment

Revenue fromexternal customers
Segment profit (loss)(core operating profit)

Adjustment[Note 2]

AmountRecorded in theConsolidated
Financial
Statements

2,672,419－

2,672,419

868

93,284(38,172)

55,112559,150

109,972

4,338,355

756,123

5,094,478

104,363

18,322

4,636

210,622

10,724

221,346

－

7,135

－

－

7,135

7,335

14,47077,787

84,91423,052

5,217

190,970

17,702

208,672

Other[Note 1]

DigitalLife Sciences
Solutions

Plastics

1,110,328

856,565

613,120

92,406

133,886(51,111)9,641

1,870,824

1,798,408

83,301

Total[Note 3]
Segment assets
Other items
Depreciation andamortization
Impairment losses
Capitalexpenditures

Note 1: The Other segment is a business segment not contained in the reportable segments. It includes the purchaseand sale of chemicals and other businesses.
Note 2: The segment profit (loss) downward adjustment of $(38,172) thousand contains company-wide profits andlosses not allocated to the reportable segments. The adjustment amount in the segment assets line arecorporate assets not allocated to any reportable segment.Corporate assets mainly include investment of
surplus funds (deposits, cash equivalents, and securities (debt instrument assets)) and longterm investment
funds (securities (equity instrument assets)) by the parent company.
Note 3: The segment profit (loss) is presented as core operating profit after deducting non-recurring profit (loss)
arising from business restructuring and other non-recurring factors from operating profit.

－

25 －

Adjustments to reconcile segment profit to profit before tax are as follows.

Segment profit

Fiscal year ended March 31,
2023(April 1, 2022 to March 31,
2023)

Fiscal year ended March 31,
2024(April 1, 2023 to March 31,
2024)

Fiscal year ended March 31,
2024(April 1, 2023 to March 31,
2024)

Millions of yen

Millions of yen

Thousands of U.S. dollars

34,025

8,345

55,112Business restructuring
expenses(9,002)(4,227)(27,917)

Gain on step acquisitions

3,429

－

－

Loss on sales of fixed
assets

(222)

－

－

Gain on sales ofsubsidiaries' stock

1,020

－

－

120

(469)

(3,098)29,3703,649

24,098OthersOperating profit
Finance income

3,523

2,579

17,031

Finance costs(3,047)(6,352)(41,950)

Profit (loss) before tax

29,846

(124)

(821)

－

26 －

3) Information on Products and Services
Information on products and services is omitted, since similar information is stated in (1) Outline of Reportable
Segments.
4) Information by Region
The following is a breakdown of revenue and non-current assets by region.
Revenue from External Customers
Fiscal year ended March 31,
2023

Fiscal year ended March 31,
2024

Fiscal year ended March 31,
2024

Millions of yen

Millions of yen

Thousands of U.S. dollars

Japan
China

154,641

160,360

1,059,109

72,016
76,771

74,637
66,056492,946436,275

105,452

107,827

684,089

408,880

404,6312,672,419

U.S.
Other regions
Total

Note: Revenue is divided into countries or regions based on the locations of customers.

Property, Plant and Equipment
As of March 31, 2023

As of March 31, 2024

As of March 31, 2024

Millions of yen

Millions of yen

Thousands of
U.S. dollars

Japan

78,891

76,118U.S.

65,50025,226

71,133
27,639169,617

174,891

Other regions
Total

502,730
469,804
182,546
1,155,080

Note: The presentation of non-current assets has been restricted to property, plant, and equipment to avoid unreasonablepreparation costs5) Information on Major Customers
Information on major customers is omitted, since no single external customer accounts for more than 10 percentof the Group’s revenue in terms of revenue through transactions with a single external customer.

－

27 －

(7) Business Combination and Acquisition of Non-controlling Interest
1) Business Combination
Fiscal year ended March 31, 2023 (April 1, 2022 to March 31, 2023)(Wholly Owned Subsidiary through Acquisition of Shares of JSR Electronic Materials Korea Co., Ltd.)(1) Outline of Business Combination
On January 10, 2023, the company acquired an additional 60.0% stake in JSR Electronic Materials Korea
Co., Ltd. ("JEMK"), a distributor of semiconductor materials, making it a wholly owned subsidiary of thecompany.
1) Name and Business of the Acquired Company
Name: JSR Electronic Materials Korea Co., Ltd.
Business: Sales agency business for semiconductor materials, etc.
2) Date of Acquisition
January 10, 2023
3) Percentage of Voting Rights Acquired
Percentage of Voting Rights Held Immediately before the Date of Acquisition 40.0%
Percentage of Voting Rights Additionally Acquired on the Date of Acquisition 60.%
Percentage of Voting Rights at Date of Acquisition
100.0%
4) Method of Acquiring Control
Acquisition of Shares for Cash
5) Purpose of Business Combination
Established in 2014, JEMK has been contributing to the growth and expansion of the company's
semiconductor materials business in South Korea. As our customers continue to develop advanced
technologies, including Metal Oxide Resists from Inpria Corporation, which was acquired by the company
in October 2021, it is becoming increasingly important for us to develop our business in a better and closer
relationship with our customers. The company has decided to make JEMK a wholly-owned subsidiary of its
company in order to improve customer satisfaction and speed up service delivery through integrated group
operations, and to further strengthen our global cooperation in the semiconductor materials business.
(2) Fair value of Consideration Paid, Assets Acquired, and Liabilities Assumed at the Date of Acquisition
AmountMillions of yen
Fair value of equity interests held immediately prior to the acquisition
date
Fair value of consideration paid
Total
Current Assets
Cash and cash equivalents
Inventories
Trade and other receivables

3,468
5,275
8,743

798
3,574
1,018
816

Other current assets
Non-current assets
Property, plant and equipment
Other intangible assets
Other financial assets
Other non-current assets
Acquired assets

31
6,539
662
76
13,514Current liabilities
Trade and other payables
Other current liabilities

4,309
1,735

Non-current liabilities－

28 －Deferred tax liabilities
Total liabilities assumed

1,437
7,480

Goodwill

2,709

In the previous fiscal year, the Company reported a provisional amount because the adjustment and allocation of
the acquisition consideration had not yet been finalized, but this amount was finalized in the current fiscal year.
From the provisional amounts, intangible assets and deferred tax liabilities increased mainly by 6,530 million yen
and 1,437 million yen, respectively, and the amount of goodwill decreased by 5,094 million yen.
Figures for the previous fiscal year included in the consolidated financial statements and notes to the consolidated
financial statements represent amounts based on the fixed amounts after the adjustment.
The valuation gain recognized by our company as a result of remeasuring the equity interest held immediately
prior to the acquisition date at fair value as of the date of acquisition of control is 3,429 million yen and isincluded in "Other operating income" in the consolidated statements of income. In addition, acquisition-related
costs related to the business combination were 26 million yen, and the amount incurred during the current fiscal
year is expensed in in the “Selling, general and administrative” line item in the consolidated statements ofincome.
Goodwill is primarily composed of expected future earning power. The goodwill cannot be reported
as a deductible for tax purposes.
(3) Effect of Business Combination on Cash Flows
AmountMillions of yen
Cash and cash equivalents paid for the acquisition
Cash and cash equivalents held by the acquired company at the time ofacquisition
Purchase of shares of subsidiaries resulting in change in scope of
consolidation

5,275
798
4,477

(4) Impact on the Group's Performance
The impact on revenue and profit arising from JEMK included in the consolidated statement of profit or loss andthe impact on revenue and profit assuming that the business combination was carried out at the beginning of thecurrent fiscal year are insignificant.
(Acquisition of Indivumed Services GmbH & Co. KG)(1) Outline of Business Combination
On March 31, 2023, Crown Bioscience International (“Crown Bioscience”), a JSR Life Sciences Company,
acquired a 100.0% stake in Indivumed Services GmbH& Co. KG (" Indivumed Services"), a provider ofbiospecimens, biobanks and clinical services, making it a wholly owned subsidiary of our company.
1) Name and Business of the Acquired Company
Name: Indivumed Services GmbH & Co. KG
Business: Biospecimens, biobank and clinical services business, etc.
2) Date of Acquisition
March 31, 2023
3) Percentage of Voting Rights Acquired
100.0%
4) Method of Acquiring Control
Acquisition of Shares for Cash
5) Purpose of Business Combination
The Company has decided to make Indivumed Services a wholly-owned subsidiary of Crown Biosciencein order to further accelerate drug discovery and create solutions to meet customer needs by bringing avariety of synergistic service platforms to Crown Bioscience's drug discovery suport services, enabling－

29 －the acquisition of high-quality biospecimens, biobanks and access to fresh patient samples.
(2) Fair value of Consideration Paid, Assets Acquired, and Liabilities Assumed at the Date of Acquisition
AmountMillions of yen

19,0296,130
25,158Cash
Contingent consideration
Total Fair value of consideration paid
Current Assets
Cash and cash equivalents
Inventories
Trade and other receivables

125
552
5,271
55

Other current assets
Non-current assets
Property, plant and equipment
Other intangible assets
Acquired assets

310
13,47019,783Current liabilities
Trade and other payables
Other current liabilities
Non-current liabilities

127
291
438
856

Deferred tax liabilities
Total liabilities assumed

6,232

Goodwill

In the previous fiscal year, the Company reported a provisional amount because the adjustment and allocationof the acquisition consideration had not been finalized, but this amount was finalized in the current fiscal year.
From the provisional amounts, intangible assets and deferred tax liabilities increased mainly by 13,462 million
yen and 438 million yen, respectively, and the amount of goodwill decreased by 12,138 million yen.
Figures for the previous fiscal year included in the consolidated financial statements and notes to theconsolidated financial statements represent amounts based on the fixed amounts after the adjustment.
Acquisition-related costs related to the business combination were 566 million yen, and the amount incurred
during the current fiscal year is expensed in in the “Selling, general and administrative” line item in the
consolidated statements of income.
Goodwill is primarily composed of expected future earning power. The goodwill cannot be reported as adeductible for tax purposes.
(3) Contingent Consideration
Contingent consideration is a payment agreement that fluctuates according to the level of achievement ofcertain indicators, such as sales after the business combination and the number of biological samples
acquired, and the Group estimates the attainability and recognizes the amount of 5,217 million yen as unpaid
acquisition consideration. The amount is calculated based on the level of achievement of each target indicator.
The maximum amount of contingent consideration is 8,743 million yen. The fair value hierarchy ofcontingent consideration is Level 3.

－

30 －

(4) Effect of Business Combination on Cash Flows
AmountCash and cash equivalents paid for the acquisition
Cash and cash equivalents held by the acquired company at the time ofacquisition
Purchase of shares of subsidiaries resulting in change in scope of
consolidation

Millions of yen
18,765
126
18,639(5) Impact on the Group's performance
The impact on sales revenue and net income generated from Individualized Services included in the
consolidated statements of income, and on sales revenue and net income assuming the business combination
is implemented at the beginning of the fiscal year is immaterial.
Fiscal year ended March 31, 2024 (April 1, 2023 to March 31, 2024)
Not Applicable2) Acquisition of Non-controlling Interest
Fiscal year ended March 31, 2023 (April 1, 2022 to March 31, 2023)
On February 13, 2023, the company acquired an additional 10.0% shares in KBI Biopharma, Inc., microbial
and mammalian, clinical and commercial biopharmaceutical contract development and manufacturingservices, to make KBI Biopharma, Inc. a wholly owned subsidiary of the company.
As the consideration for additional acquisition, cash of ¥ 4,922 million was paid to the non-controllinginterest shareholders, and the Group accounted for ¥ 5,021 million as the decreasing capital surplus ,which isthe difference between the consideration for the additional acquisition and ¥ (99) million which is the total
amount of non-controlling interest reduced because of the additional acquisition, the exchange differences ontranslation of foreign operations and valuation difference on available-for-sale securities.
Fiscal year ended March 31, 2024 (April 1, 2023 to March 31, 2024)
Not Applicable

－

31 －

(8) Cash and Cash Equivalents
Cash and cash equivalents for each fiscal year are as follows.
Cash and cash equivalents comprise cash, short-term deposits (not later than three months) and short-term
investments (e.g. securities redeemable not later than three months from the date of acquisition).
Cash and cash equivalents on the indicated dates consisted of the following items.
The total amount of cash and cash equivalents corresponds to cash and cash equivalents at the end of the period
in the consolidated statement of cash flows.

Cash and cash
equivalents
Cash and deposit
Short-term investment
Total

As of March 31,2023

As of March 31,2024

As of March 31,
2024

Millions of yen

Millions of yen

Thousands of
U.S. dollars

72,634

100,640

664,686

5

5

33

72,639100,645664,719(9) Trade and Other Receivables
Trade and other receivables are classified as financial assets measured at amortized cost.
Trade and other receivables include the following items.
As of March 31,2023

As of March 31,2024

As of March 31,
2024

Millions of yen

Millions of yen

Thousands of U.S.
dollars

Trade receivables
Notes and account receivabletrade
Other receivables
Account receivables-other
Other
Total

70,59577,193509,827

8,292
112
78,99910,61293
87,89770,085613
580,526－32 －(10) Other financial assets
1) Breakdown of Other financial assets
The breakdown of other financial assets is as follows:
As of March 31,2023

As of March 31,
2024

Millions of yen

Millions of yen

As of March 31,
2024
Thousands of U.S.
dollars
321,81078-

Investments (equity financial assets)

31,632

48,725

Term deposits
Other

2,285
1,819

475
1,295

3,134

35,81450,494

333,494

2,657
33,157717
49,777

4,735
328,759

35,81450,494

333,494

Derivative asset

Total
Current assets
Non-current assets
Total

8,551

Derivative assets are classified as financial assets measured at fair value through profit or loss. Investments(equity financial assets) are classified as financial assets measured at fair value through other comprehensive
income, or those through profit or loss. Term deposits are classified as financial assets measured at amortized
cost.
2) Financial Assets Measured at Fair Value through Other Comprehensive Income
Major stocks classified as financial assets measured at fair value through other comprehensive income and theirfair values are as follows:

Name of Stock

As of March 31, 2023

As of March 31, 2024

As of March 31, 2024

Millions of yen

Millions of yen

Thousands of U.S. dollars

Cambridge Quantum Computing.

3,690

18,172120,022

Carbon, Inc.

6,309

5,006

33,065

Optorun Co., Ltd.

5,114

4,777

31,551

Vedanta Biosciences Inc

2,972

3,203

21,154

1,509

2,216

14,632

Other

9,081

11,87378,414

Total

28,67645,247

298,838OSAKA ORGANIC CHEMICALINDUSTRY LTD.

Amounts of dividends received recognized related to financial assets measured at fair value through othercomprehensive income are as follows:

Dividends received

Fiscal year ended March 31,
2023

Fiscal year ended March 31,
2024

Fiscal year ended March 31,
2024

Millions of yen

Millions of yen

Thousands of U.S. dollars

434
－

331
33 －

2,188

3) Derecognition of Financial Assets Measured at Fair Value through Other Comprehensive Income
The Group has derecognized certain financial assets measured at fair value through other comprehensive income
by disposing of such assets for the purpose of improving the asset efficiency. Fair value and accumulated gains
or losses (net of tax) recognized as other comprehensive income at the time of disposal in each fiscal year are as
follows:
Fiscal year ended March 31, 2023

Fiscal year ended March 31,2024

Fiscal year ended March 31, 2024

Millions of yen

Millions of yen

Thousands of U.S. dollars

Fair Value
1,124

Accumulated
gains or losses

Accumulated
gains or losses

Fair Value

(226)

357

(79)

Fair Value
2,355

Accumulated
gains or losses(523)

For financial assets measured at fair value through other comprehensive income, accumulated gains or losses
recognized as other comprehensive income are transferred to retained earnings when the assets are derecognized.
(11) Inventories
Inventories consist of the following items.

Finished goods and merchandiseWork in process
Raw materials and supplies
Total

As of March 31,2023

As of March 31,2024

As of March 31,
2024

Millions of yen

Millions of yen

Thousands of
U.S. dollars

62,482
2,629

58,436
2,955

385,942

53,38442,51919,514
280,823

118,494

103,910686,279

The amount of valuation losses on inventories recognized as expenses was ¥ 466 million as of March 31, 2023
and ¥ (99) million ($ (655) thousand) as of March 31, 2024. The write-off amount is included in “cost of sales”
in the consolidated statement of profit or loss.
The amount included in cost of sales was ¥ 204,695 million as of March 31, 2023 and ¥ 196,959 million($ 1,300,832 thousand) as of March 31, 2024.

－

34 －

(12) Discontinued Operations
At the Board of Directors meeting held on May 11, 2021, the Company decided to transfer the Elastomers
Business to ENEOS Corporation, and accordingly, the business was classified as discontinued operations. The
transfer was completed on April 1, 2022.
The following are cash flows from discontinued operations.
Fiscal year ended
March 31, 2023

Fiscal year ended
March 31, 2024

Fiscal year ended
March 31, 2024

Millions of yen

Millions of yen

Thousands of U.S.
dollars

Cash flows from operating activities

-

-

-

Cash flows from investing activities*

50,880--Cash flows from financing activities
Effect of exchange rate changes oncash and cash equivalents
Total

-

-

-

-

-

-

50,880--Note: The relationship between consideration received for the transfer of shares and income and expenditure of thetransfer is as follows:
Millions of yen
Consideration received

68,473

Cash and cash equivalents of transferred subsidiaries(17,593)

Proceeds from sale of shares of subsidiaries resulting in change in scopeof consolidation

50,880(13) Other Assets
The breakdown of other assets is as shown below.
As of March 31,2023

As of March 31,2024

As of March 31,
2024

Millions ofyenMillions ofyen

Thousands of
U.S. dollars

Excise tax receivable
Income taxes receivable

7,719
10,689

6,638
2,484

43,844
16,406

Prepaid expenses
Other

2,892
5,418

3,787
3,839

25,011
25,358

Total

26,71816,749110,620

224

567

3,744

3,214

4,090

27,013

3,438

4,657

30,757

Other current assets

Other non-current assets
Long-term prepaid expenses
Other
Total

－

35 －

(14) Property, Plant and Equipment
Changes in carrying amounts and the balance of acquisition costs and accumulated depreciation of property, plantand equipment are as follows. For information on impairment losses, see “(17) Impairment on Non-financial
Assets.”Changes in carrying amounts(Millions of yen)
Buildings
andstructures

MachineryandvehiclesTools,
fixturesandfittings

April 1, 2022

64,38336,521

9,948

15,09833,452

135

159,539

Acquisition

2,600

5,252

884

826

30,071936

40,570

7

313

21

-

-

-

341

Depreciation(8,747)(10,485)(4,300)

(127)

-

-

(23,659)

Impairment loss
Sales and disposals(3,245)(1,214)(4,416)
(185)

(112)
(530)

-

(29)
(74)

(77)

(7,801)(2,079)Transfer

29,846

7,675

4,507

-

(41,974)

(54)

-

1,432

1,227

185

204

4,098

17

7,162

Other

(1,930)

(341)

14

205

(2,403)-(4,455)

March 31, 2023

83,133
5,583

35,561
3,457

10,617
1,153

16,206-23,143
17,831

957
677

169,61728,701

-

-

-

-

-

-

-

(11,979)(864)(10,265)(136)(4,548)
(72)

(125)
-

(6)

-

(26,917)(1,078)(168)
12,802

(787)
8,795

(11)
3,379

(69)
-

(7)
(23,653)(1,324)(1,042)
-

7,875

1,973

344

330

1,682

35

12,239Acquisition by businesscombination

Exchange differences offoreign operations

Acquisition
Acquisition by businesscombination
Depreciation
Impairment loss
Sales and disposals
Transfer
Exchange differences offoreign operations

Land

Constructionin progress

Other

Total

Other

(3,556)

255

(49)

-

(3,282)

1(6,630)March 31, 2024

92,82638,854

10,813

16,342

15,709347

174,891

Buildings
andstructures

MachineryandvehiclesTools,
fixturesandfittings

Land

Constructionin progress

Other

Total

549,058
36,873234,865
22,834

70,122
7,618

107,035-

152,851
117,764

6,320
4,473

1,120,251
189,561

-

-

-

-

-

-

-

(79,114)(5,708)(67,793)(901)(30,040)
(476)

(826)
-

(38)

-

(177,774)(7,123)(1,110)84,554(5,197)58,089(70)
22,315

(457)
-

(47)
(156,216)(8,742)(6,881)-52,01013,030

2,269

2,180

11,109232

80,831

1,685
256,612(324)-(21,673)

71,414

107,933

103,749

10
2,293(43,786)(Thousands of U.S. dollars)

March 31, 2023
Acquisition
Acquisition by businesscombination
Depreciation
Impairment loss
Sales and disposals
Transfer
Exchange differences offoreign operations
Other(23,483)

March 31, 2024

613,078

Acquisition Cost－

36 －1,155,080

(Millions of yen)March 31, 2023
March 31, 2024

Buildings
andstructures

MachineryandvehiclesTools,
fixturesand fittingsLand

166,329
187,332

166,043
176,739

65,78768,013

18,161
18,493

Buildings
andstructures

MachineryandvehiclesTools,
fixturesand fittings

Land

1,237,248

1,167,287

449,199

122,139

Constructionin progress

Other

Total

23,172
15,714957
347

440,449
466,639(Thousands of U.S. dollars)

March 31, 2024

Constructionin progress

Other

Total

103,787

2,293

3,081,953

Accumulated Depreciation and Impairment(Millions of yen)March 31, 2023
March 31, 2024

Buildings
andstructures

MachineryandvehiclesTools,
fixturesand fittings

Land

83,197
94,505130,482
137,885

55,17057,200

1,955
2,151

Buildings
andstructures

MachineryandvehiclesTools,
fixturesand fittings

Land

624,169

910,674

377,785

14,206

Constructionin progress

Other

Total

29
6

-

270,832
291,748(Thousands of U.S. dollars)

March 31, 2024

Constructionin progress
38

Other

Total
-

1,926,873(Note) 1. Depreciation expenses of property, plant and equipment are recorded as “inventories” in the consolidated statement offinancial position, or “cost of sales” and “selling, general and administrative expenses” in the consolidated statement of
profit or loss.
2. Impairment loss is recorded as “other operating expenses” in the consolidated statement of profit or loss.
3. “Other” in the changes of carrying amounts includes transfer to/from “inventories” in the consolidated statement offinancial position, or “cost of sales” and “selling, general and administrative expenses” in the consolidated statement of
profit or loss.
4. Amounts of property, plant and equipment pledged as collateral for liabilities are stated in “(20) Borrowings and bonds (including Other financial liabilities).”
5. Right-of-use asset included in carrying amounts of property, plant and equipment is stated in “(15) Lease.”

－

37 －

(15) Leases
The Group leases Offices, Production equipment, Company cars, Land and Other assets as the lessee.
Certain lease contracts include an extension option. No significant restrictions are imposed by lease
contracts, such as restrictions regarding additional borrowings or leases.
1) Right-of-use Asset
Carrying amount of right-of-use assets and the breakdown of depreciation expenses are as follows:

Fiscal year ended March 31, 2023 (from April1, 2022 to March 31, 2023)(Millions of yen)
Buildings andMachinery

Tools, fixtures

structuresand vehicles

and fittings

Land

Total

Carrying amount

16,419

2,056

48

778

19,302

Depreciation(3,614)

(34)

(12)

(127)

(3,787)(Note) 1. Increase amount of right-of-use asset is ¥2,650 million.
2. Depreciation of right-of-use assets is included in "Inventories" in the consolidated statement of the financial positionor "Cost of sales" and "Selling, general and administrative expenses" in the consolidated statement of profit or loss.

Fiscal year ended March 31, 2024 (from April 1, 2023 to March 31, 2024)(Millions of yen)
Buildings andstructures

Machineryand vehicles

Tools, fixturesand fittings

Land

Total

Carrying amount

17,440

2,232

37

651

20,359Depreciation(3,306)

(59)

(12)

(125)

(3,502)(Note) 1. Increase amount of right-of-use asset is ¥ 4,908 million.
2. Depreciation of right-of-use assets is included in "Inventories" in the consolidated statement of the financial positionor "Cost of sales" and "Selling, general and administrative expenses" in the consolidated statement of profit or loss.

(Thousands of U.S. dollars)
Buildings andstructures

Machineryand vehicles

Tools, fixturesand fittings

Land

Total

Carrying amount

115,185

14,739242

4,298

134,463

Depreciation(21,833)

(391)

(77)

(826)

(23,127)(Note) 1. Increase amount of right-of-use asset is $ 32,415 thousand.
2. Depreciation of right-of-use assets is included in "Inventories" in the consolidated statement of financial position
or “Cost of sales" and "Selling, general and administrative expenses" in the consolidated statement of profit or loss.

－

38 －

2) Finance Costs Related to Lease
Finance costs related to leases are as follows:
Fiscal year ended March 31, 2023(from April 1, 2022 to March 31, 2023)
Millions of yen
Finance costs related to leases

434

Expenses relating to short-term leases

328

Expenditures relating to leases of low-value assets

472

Variable lease payments

68

The amount of cash outflow related to leases

3,744

Fiscal year ended March 31, 2024(from April 1, 2023 to March 31, 2024)
Millions of yen

Thousands of U.S.
dollars

Finance costs related to leases

390

2,578

Expenses relating to short-term leases

394

2,604

Expenditures relating to leases of low-value assets

509

3,364

Variable lease payments

130

856

4,112

27,161

The amount of cash outflow related to leases(Note) 1. Finance costs related to leases are included in "Finance costs" in the consolidated statement of profit or loss.
2. Expenses relating to short-term leases, expenditures relating to leases of low-value assets and variable lease payments
are included in "Cost of sales," and"Selling, general and administrative expenses" in the consolidated
statement of profit or loss.

For the information on Maturity analysis for lease liabilities, see “(34) Financial Instruments, 2) Financial
Risks, (iii) Liquidity Risks.”

－

39 －

(16) Goodwill and Other Intangible Assets
Changes in carrying amounts and the balance of acquisition costs and accumulated amortization of goodwill andother intangible assets are as follows. For information of impairment losses, see “(17) Impairment on Nonfinancial Assets.”
Changes in Carrying Amounts(Millions of yen)
Other intangible asset
Goodwill
SoftwareApril 1, 2022
Acquisition
Acquisition by businesscombination
Amortization
Sales and disposals

Other

Total

117,640

10,307716

14,264
4,516

24,571
5,232

8,941

16

19,99220,008－(2,199)(25)(4,766)
(68)

(830)

(2,567)(43)

Transfer to other property, plantand equipment

－

365

(365)

－

Exchange differences of foreign
operations

9,985

73

749

822

－

1,022

842

1,864

March 31, 2023
Acquisition

135,735
－

9,890
238

37,774
4,256

47,664
4,494

Amortization
Impairment loss－－

(2,738)(128)(3,860)(984)(6,597)(1,112)

Sales and disposals
Transfer to other property, plant

－

(3)

(433)

(436)

－

2,766

(2,766)－

17,371

266

3,780

4,046

－

591

861

1,452

153,107

10,882

38,62849,509Other

and equipment
Exchange differences of foreign
operations
Other
March 31, 2024

－

40 －

(Thousands of U.S. dollars)
Other intangible asset
Goodwill
SoftwareMarch 31, 2023
Acquisition
Amortization
Impairment loss
Sales and disposals
Transfer to other property, plantand equipment
Exchange differences of foreign
operations
Other
March 31, 2024

Other

Total

896,476-

65,316
1,73

249,482
28,106

314,799
29,680-(18,081)(25,491)(43,572)

-

(845)
(22)

(6,502)(2,857)(7,347)(2,879)-18,269(18,269)-

114,729

1,755

24,966

26,721

-

3,904

5,684

9,588

1,011,205

71,869255,119

326,989

Acquisition Cost
(Millions of yen)
Other intangible asset

Goodwill

Software

Other

Total

March 31, 2023

135,735

33,906

55,681

89,587

March 31, 2024

153,107

34,90556,25891,162(Thousands of U.S. dollars)
Other intangible asset

Goodwill
SoftwareMarch 31, 2024

1,011,205

230,530

Other

Total

371,560

602,090

Accumulated Amortization and Impairment(Millions of yen)
Other intangible asset

Goodwill
March 31, 2023
March 31, 2024

Software-

Other

24,01624,023

Total
17,907
17,63041,92341,653(Thousands of U.S. dollars)
Other intangible asset

Goodwill
March 31, 2024

Software-158,661

Other
116,440

Total
275,101(Note) 1. Amortization expenses of other intangible assets are recorded as “cost of sales” and “selling, general and administrative
expenses”.
2. “Other” in the changes of carrying amounts includes transfer to from “cost of sales” and “selling, general andadministrative expenses” in the consolidated statement of profit or loss.

－

41 －

(17) Impairment on Non-Financial Assets
1) Impairment Losses on Property, Plant and Equipment and Intangible Assets Other Than Goodwill
Impairment losses in the fiscal years ended March 31, 2023 and 2024 are as follows:
Fiscal year ended March 31,
2023
Millions of yen

Fiscal year ended March 31,
2024
Millions of yen

Fiscal year ended March 31,
2024
Thousands of U.S. dollars

3,245
4,416
112
29

864
136
72
6

5,708
901
476
38

7,801

128
984
2,191

845
6,502
14,470Property, plant and equipment
Buildings and structures
Machinery and vehicles
Tools, fixtures and fittings
Construction in progress
Intangible assets
Software
Other
Total

In the previous fiscal year, due to a significant decline in the revenue outlook as a result of the worsening businessenvironment in the U.S. for our cleaning solutions business, the book value of the assets at the U.S. plant, forwhich the recovery of the investment amount could no longer be expected, was reduced to the recoverable
amount. An impairment loss of ¥7,801 million was recorded as "Other operating expenses."In the current fiscal year, upon reviewing the future plans in the course of the business reorganization of the
CDMO business, the book value of the assets, for which the recovery of the investment amount could no longer
be expected, was reduced to the recoverable amount. The resulting reduction amounting to ¥1,080 million($ 7,135 thousand )was recorded as an impairment loss under "Other operating expenses."In the current fiscal year, for the assets related to DX investments, where the recovery of the investment amount
could no longer be expected, the book value was reduced to the recoverable amount. The related reduction
amounting to ¥1,111 million($ 7,335 thousand) was recorded as an impairment loss under "Other operating
expenses."
2) Reversal of Impairment Losses
There are no applicable items.

－

42 －

3) Impairment Test on Goodwill
The goodwill recorded in the consolidated statement of financial position is primarily goodwill related todrug discovery and development services that arose upon the acquisition of Crown Bioscience Internationalin fiscal 2018 and the acquisition of Indivumed Services GmbH & Co. KG in fiscal 2022, and Goodwill
related to lithography materials and other products arising from the acquisition of Inpria Corporation in
fiscal 2021 and the acquisition of JSR Electronic Materials Korea Co. The carrying amounts of goodwill
allocated to each cash-generating unit (or group of cash-generating units) are as follows
Segment

Cash-generating units(groups of cash-generating units)

Plastics business

Plastics

Life Sciences

In-vitro Diagnostics and Researchbusiness

Reagents
CDMO (Contract Development
and Manufacturing Organizationfor Biopharmaceuticals)Drug Discovery and Development
Services

DigitalSolutions

As of March 31,2023

As of March
31, 2024

As of March 31,
2024

Millions of yen

Millions ofyen

Thousands of
U.S. dollars

2,598

2,598

17,162

3,641

3,641

24,047

17,165

19,626

129,62152,06659,019389,797

60,26568,222450,578

135,735

153,107

1,011,205

Lithography Materials, etc.

Business
Total(Note).
JSR Life Sciences LLC, which oversees our Life Sciences business, has integrated the operations of KBI
Biopharma, Inc. (KBI) and Selexis SA (SLX) in the current consolidated fiscal year with the aim ofproviding customers with more seamless solutions, ranging from cell line development to processdevelopment, and clinical and commercial cGMP manufacturing services for animal cell programs.
Until the previous consolidated fiscal year, the cash-generating unit for KBI was "Contract of the Services
for Development and Generation of Cell-lines" and for SLX was "Contract Cell Line Construction
Services." However, following the integration, from this fiscal year, the cash-generating unit for "Contract Cell Line Construction Services" has been consolidated into the cash-generating unit for"CDMO (Contract Development and Manufacturing Organization for Biopharmaceuticals)."(Note) .
The Group acquired Inpria Corporation in September 2021 with the aim of acquiring technology for Metal
Oxide Resists (MOR). Chemically Amplified Resists (CAR) and MOR used in extreme ultraviolet (EUV)
lithography are lithographic materials used in the same EUV exposure, and following a review of thecommercial flow, we have started offering MOR as part of our lithography materials product lineup in
addition to the CAR that we have traditionally commercialized. Accordingly, from the current
consolidated fiscal year, the cash-generating unit for MOR has been consolidated into the cash-generating
unit for lithography materials, etc. In addition, the goodwill previously allocated to each cash-generating
unit has been reallocated to this cash-generating unit. Furthermore, the provisional of goodwill arisingfrom the acquisition of JSR Electronic Materials Korea Co., Ltd., which was presented as "Lithography
Materials" in the previous consolidated fiscal year, has been finalized in the current fiscal year as
described in "7. Business Combinations and Acquisitions of Non-controlling Interests," and the revised
initial allocation amount of the acquisition cost is now reflected as the finalized amount attributed to"Lithography Materials, etc."
Of the above goodwill, major goodwill was tested for impairment as follows. The recoverable amount
was measured as the higher of the value in use or the fair value less costs of disposal.
The value in use was calculated by reflecting the external information such as past experience and market
growth rate which each cash-generating unit or cash-generating unit groups belong to and internal
information such as equipment capacity, and it was discounting the estimated amount of cash flows to
the present value based on the plan approved by management.
－

43 －A terminal growth rate used for impairment test of major goodwill, pre-tax discount rate and term toestimate cash flows are as below.
Measured at the Value in Use
Cash-generating units(groups of cash-generating units)

Terminal growth rate

Pre-tax discount rate

0.0%

10.0%

5 years

1.0%

7.5%

5 years

2.0%

15.0%

5 years

2.0%

15.4%

5 years

2.0%

10.8%

5 years

Plastics
In-vitro Diagnostics andResearch Reagents
CDMO (Contract
Development andManufacturing Organizationfor Biopharmaceuticals)Drug Discovery andDevelopment Services
Lithography Materials, etc.

Term to estimate cash flows

Except for drug discovery and development services, based on the calculations using the above, therecoverable amount significantly exceeds the carrying amount for each cash-generating unit or groupof cash-generating units, and we believe that even if there is a reasonable range of variability in the
key judgments for each cash-generating unit or group, the recoverable amount will not fall below thecarrying amount.
For drug discovery and development services, if the discount rate were to increase by 0.1% or if theperpetual growth rate used to calculate the continuing value of the business were to decrease by 0.1%,
the recoverable amount would become equal to the carrying amount.

(18) Investments Accounted for Using the Equity Method
There are no investments in significant associates.
Carrying ammount of investments in associates that are not individually significant is as follows:
As of March 31, 2023

As of March 31, 2024

As of March 31, 2024

Millions of yen

Millions of yen

Thousands of U.S.
dollars

Carrying amount

2,479

2,756

18,202The Group’s share of comprehensive income of associates that are not individually significant is as follows:
Fiscal year ended
March 31, 2023

Fiscal year ended
March 31, 2024

Millions of yen

Millions of yen

Fiscal year ended
March 31, 2024

Share of profit

87

94

Thousands of U.S.
dollars
621

Share of other comprehensive income

414

188

1,239

Share of total comprehensive income

501

282

1,860

－

44 －

(19) Income Taxes
1) Deferred Tax Assets and Liabilities(i) Deferred Tax Assets and Liabilities Recognized
The breakdown of deferred tax assets and liabilities by major causes for occurrence in each fiscal
year is as follows:
Fiscal year ended March 31, 2023 (April 1, 2022 to March 31, 2023)(Millions of yen)
April 1,
2022

Recognizedthrough
profit(loss)

RecognizedthroughothercomprehensiveincomeDeferred Tax Assets
Inventories

1,274

(149)

-

Accrued bonuses
Non-current assets

2,206
26,148(908)(24,043)

Retirement benefit liability
Unused tax losses

3,409
172

(2,046)
10,898-Other

March 31,
2023

Other

-

-

-

1,124
1,297
2,106
1,364
11,070

7,454

967

(134)

(164)

8,123

40,663(15,281)

(134)

(164)

25,084(1,465)

(64)

-

-

(1,529)Financial asset measured at fair value
through other comprehensive income(3,884)

-

(295)

66

(4,114)Retained earnings
Other(9,303)(2,938)

7,973
(253)

(1,842)(1,330)(17,590)

7,656

(295)

Total
Deferred Tax Liabilities
Non-current assets

Total(1,776)(5,033)(12,006)

Fiscal year ended March 31, 2024 (April 1, 2023 to March 31, 2024)(Millions of yen)
April 1,
2023

Deferred Tax Assets
Inventories

Recognizedthrough
profit(loss)

Recognizedthroughothercomprehensiveincome

1,124
1,297

(270)
(254)

Retirement benefit liability
Unused tax losses

2,106
1,364

(257)
(403)

-

11,070(2,829)

Other

8,123

Accrued bonuses
Non-current assets

Total
Deferred Tax Liabilities
Non-current assets

March 31,
2024

Other

-

854
1,043

-

1,849
960

-

-

8,241

4,995

92

2

13,21225,084982

92

2

26,159-(1,529)78--(1,452)Financial asset measured at fair value
through other comprehensive income(4,114)-(4,839)47(8,906)

Retained earnings
Other(1,330)(5,033)

43
(325)

-

(12,006)(204)(4,839)(1,287)(5,358)(17,002)

Total

－

45 －

47

Fiscal year ended March 31, 2024 (April 1, 2023 to March 31, 2024)(Thousands of U.S. dollars)
April 1,
2023

Recognizedthrough
profit(loss)

RecognizedthroughothercomprehensiveincomeMarch 31,
2024

Other

Deferred Tax Assets
Inventories
Accrued bonuses

7,426
8,569

(1,783)(1,681)

-

-

5,642
6,888

Non-current assets
Retirement benefit liability

13,906
9,006(1,696)(2,663)--

12,211
6,343

Unused tax losses
Other73,115(18,685)1254,431

Total

53,64732,993605

165,669

6,486

605

12

172,772(10,099)

513

-

-

(9,587)(27,168)-(31,961)310(58,819)

87,257

Deferred Tax Liabilities
Non-current assets
Financial asset measured at fair value
through other comprehensive income
Retained earnings
Other
Total

(8,785)283--(8,502)(33,243)(2,143)-(79,296)(1,348)(31,961)(35,386)(112,294)

310(ii) Temporary Differences, etc. for Which Deferred Tax Assets Have Not Been Recognized
The Group assesses the recoverability of deferred tax assets in each period and recognizes deferred
tax assets taking into account significant uncertainty on the recoverability of its deferred tax assets.
Tax losses carried forward and deductible temporary differences for which deferred tax assets havenot been recognized are as follows:
As of March 31,2023

As of March 31,
2024

Millions of yen

Millions of yen

Deductible temporary differences

21,827
14,86823,98917,777

158,438
117,408

Total

36,69541,766

275,846

Unused tax losses

As of March 31,
2024
Thousands of U.S.
dollars

Expiration schedule of tax losses carried forward for which no deferred tax asset is recognized is
as follows:
As of March 31,2023

As of March 31,2024

As of March 31,
2024

Millions of yen

Millions of yen

-

-

-

Thousands of U.S.
dollars

Not later than one year
Later than one year and not later
than five years
Later than five years

6,455

4,396

29,031

15,372

19,593

129,407

Total

21,82723,989158,438

The amount of taxable temporary differences pertaining to investments in subsidiaries, etc. forwhich deferred tax liabilities have not been recognized was ¥50,347 million as of March 31, 2023
and ¥45,117million ($297,977 thousand) as of March 31, 2024. For these temporary differences,－

46 －deferred tax liabilities have not been recognized because the Group can control the timing of thereversal of the temporary differences and it is probable that the temporary differences will notreverse in the foreseeable future.
2) Income Tax Expense
The breakdown of income tax expense is as follows:
Fiscal year ended March 31,
2023

Fiscal year ended March 31,
2024

Fiscal year ended March 31,
2024

Millions of yen

Millions of yen

Thousands of U.S. dollars

Current tax expenses

5,755

1,915

Previous Taxes Expenses
Deferred tax expenses

47
7,625

(473)
(778)

Total

13,427665

12,650(3,124)(5,138)4,389

Differences between statutory income tax rates and average effective tax rates can be explained by
the following factors.
Fiscal year ended March 31, 2023

Fiscal year ended March 31, 2024%%

Statutory income tax rate
Retained earnings
Differences in tax rates applied to foreign operations
Special deduction for reconstruction district
Share of loss (profit) of entities accounted for using
the equity method
Other
Average effective tax rate

－

47 －

30.6
(0.6)

30.6
493.0

2.2
2.1

3.1
(2,586.8)

10.4(1,557.5)

0.3

119.0

45.0

(3,498.7)

(20) Borrowings and bonds (including Other financial liabilities)
1) Financial Liabilities
Borrowings and bonds (including Other financial liabilities) consisted of the following:
As of March
31, 2023

As of March
31, 2024

As of March
31, 2024

Averageinterest
rates

Millions ofyenMillions ofyen

Thousands of
U.S. dollars%

Current borrowings

36,78042,136278,294

4.37%-

Commercial Papers

19,99839,988264,103

0.03%-

Payment
Due

Current portion of noncurrent borrowings
Non-current borrowings

5,732

15,480102,241

1.20%-

35,87821,623

142,8120.94%

2025-32

Bonds Payable

59,80559,841

395,2280.39%

2025-32

Current lease liabilities
Non-current leaseliabilities
Derivative liabilities

3,195

3,496

23,087--

15,647

17,283

114,144-2025-42

2,698

14,107

93,168--Contingent consideration

6,130

6,950

45,904

-

-

Total

185,862

220,904

1,458,981--

Current liabilities

65,753

101,865

672,779--

Non-current liabilities

120,109

119,039786,202

-

-

Total

185,862

220,904

1,458,981--

Borrowings and bonds are classified as financial liabilities measured at cost. Derivative liabilities andContingent consideration are classified as financial liabilities measured at fair value through profit or loss.
No restrictive financial covenants have been attached to the Group’s borrowings.
Payment schedules of non-current borrowings and bonds payable are as follows:(Millions of yen)
Later than one
year and notlater than two
years

Later than two
years and notlater than three
years

Later than three
years and notlater than four
years

2,700

3,923

1

-

15,00021,62313,000-15,000-32,00060,000Later than one
year and notlater than two
years

Later than two
years and notlater than three
years

Later than three
years and notlater than four
years

Later than four
years and notlater than fiveyears

Non-current
borrowings

17,83025,907

6-

99,069142,812

Bonds Payable

85,860-99,069-211,347

396,276

Non-current
borrowings
Bonds Payable

Later than four
years and notlater than fiveyears

Later than five
years

Total

(Thousands of U.S. dollars)

－

48 －

Later than five
years

Total

2) Pledged Assets
The Company and its consolidated subsidiaries have pledged collateral under standard customary terms instandard borrowing contracts.
Pledged assets are as follows:
As of March 31,2023

As of March 31,
2024

Millions of yen

Millions of yen

7,719

7,625

dollars
50,357

7,719

7,625

50,357

As of March 31,2023

As of March 31,2024

As of March 31,
2024

Millions of yen

Millions of yen

-

30

198

30

-

-

30

30

198

Property, plant and equipment
Total

As of March 31,
2024
Thousands of U.S.

Corresponding liabilities are as follows:

Current borrowings and current
portion of non-current borrowings
Non-current portion of noncurrent borrowings
Total

－

49 －

Thousands of
U.S. dollars

3) Reconciliation of Liabilities Arising from Financing Activities
Fiscal year ended March 31, 2023 (April 1, 2022 to March 31, 2023)(Millions of yen)
Non-cash items
Exchangedifferences

Transfer
between noncurrent andcurrent-

1,236(5,815)-35,87824,872

-

-

-

42

59,80559,167(22,569)

-

127

5,815

(28)

42,512

10,003

9,995

-

-

-

-

19,99819,215(3,744)

2,251

1,218

-

(100)

18,842

137,123

35,165

2,251

2,581

-

(86)

177,035

As of April 1,
2022

Cash flow

Borrowings(non-current)

13,847

26,610Bonds Payable

34,890Borrowings(current)
Commercial
PapersLeaseliabilities
Total

Lease

As of March
31, 2023

Other

Fiscal year ended March 31, 2024 (April 1, 2023 to March 31, 2024)(Millions of yen)
Non-cash items
Exchangedifferences

Transfer
between noncurrent andcurrent-

914(11,111)-

21,623

-

-

-

-

37

59,841

42,512

(889)

-

4,905

11,111(22)

57,617

19,99819,990----39,98818,842(4,112)

2,427

3,669

-

(46)

20,778177,035

10,931

2,427

9,487

-

(32)

199,847

As of April 1,
2023

Cash flow

Borrowings(non-current)

35,878(4,057)

Bonds Payable

59,805

Borrowings(current)
Commercial
PapersLeaseliabilities
Total

Lease

As of March
31, 2024

Other

Fiscal year ended March 31, 2024 (April 1, 2023 to March 31, 2024)(Thousands of U.S. dollars)
Non-cash items
Transfer
Exchange
betweendifferences
non-current
and current

As of April
1, 2023

Cash flow

Borrowings(non-current)

236,960(26,798)-

6,033(73,384)-

142,812

Bonds Payable

394,986

-

-

-

-

242

395,228

280,773(5,870)-32,39673,384(147)

380,535

132,080132,024

-

-

-

-

264,103

124,441(27,161)

16,02624,229-(306)

137,231

1,169,240

72,19516,02662,658-(211)

1,319,909

Borrowings(current)
Commercial
PapersLeaseliabilities
Total

Lease

－

50 －

As of March
31, 2024

Other(21) Trade and Other Payables
Trade and other payables are classified as financial liabilities measured at amortized cost. The breakdown isshown below.
As of March 31,2023

As of March 31,2024

As of March 31,
2024

Millions of yen

Millions of yen

40,67848,666

321,420

38,86830,363

200,533

326

685

4,523

79,872

79,714526,476

Thousands of U.S.
dollars

Trade Payable
Notes and accounts payable trade
Other Payable
Accounts payable - other, andaccrued expenses
Other
Total

(22) Employee Benefits
1) Outline of Post-Employment Benefit Plans
The Company and certain consolidated subsidiaries have adopted funded and unfunded defined benefit
plans and defined contribution plans, and virtually all employees of these companies are covered bythese plans. In Japan, defined benefit plans under the Defined-benefit Corporate Pension Act, defined
benefit corporate pension plans and lump-sum retirement benefit plans have been operational. The
amount of these benefits is calculated based on certain points, etc. given in accordance with service
years and contribution. These pension plans are exposed to general investment risk, interest rate risk,
inflation risk and others.
Funded defined benefit plans have been operated by a corporate pension fund that is legally separated
from the Group in accordance with laws and regulations including Defined-Benefit Corporate Pension
Act. The board of the corporate pension fund and the pension-managing trustee are required by laws
and regulations to act in the best interests of plan participants, and are responsible for managing plan
assets based on predetermined policies.
The management of plan assets is conducted based on basic asset allocation aimed to ensure stablerevenue in the medium to long term within the limits of tolerable risks, in order to ensure the paymentof pension benefits, etc. at present and in the future. The basic asset allocation is periodically reviewed
in order to respond to changes in the market environment and the funding position from initialassumptions made.

－

51 －

2) Defined Benefit Plans(i) Reconciliation of Defined Benefit Plan Obligations and Plan Assets
The relationship between defined benefit plan obligations and plan assets, and net defined benefit
liabilities and assets recorded in the consolidated statement of financial position is as follows:
As of March 31,2023

As of March 31,
2024

Millions of yen

Millions of yen

28,983

28,104

185,613(32,415)(32,239)(212,923)(3,432)(4,135)(27,310)

8,243

7,806

51,556

4,811

3,671

24,246

10,485(5,674)

10,045(6,374)

66,341(42,095)

4,811

3,761

24,246

Present value of funded retirement
benefit obligation
Fair value of plan assets
SubtotalPresent value of unfunded
retirement benefit obligation
Total Net liability (asset) for
retirement benefit

As of March 31,
2024
Thousands of U.S.
dollars

Amounts on consolidated
statement of financial position
Retirement benefit liability
Retirement benefit asset
Total Net liability (asset) for
retirement benefit(ii) Reconciliation of Present Value of Defined Benefit Plan Obligations
Increase or decrease in the present value of defined benefit plan obligations is as follows:
Fiscal year ended
March 31, 2022

Fiscal year ended
March 31, 2023

Fiscal year ended
March 31, 2023

Millions of yen

Millions of yen

Thousands of U,S,dollars

43,18837,226245,864

1,539
213

1,715
351

11,327
2,319

829

130

862

(1,846)(1,092)(7,212)(2,308)(2,151)(14,209)(4,890)

-

-

502

(270)

(1,782)37,22635,910237,169

Balance of present value of retirement benefit
obligation at the beginning of the fiscal year
Service cost
Interest expense
Remeasurement
Actuarial gains (losses) arising from changes indemographic assumptions
Actuarial gains (losses) arising from changes infinancial assumptions
Benefits paid
Transfer to liabilities associated with disposalgroup classified as held for sale
Other
Balance of present value of retirement benefit
obligation at the end of the fiscal year

The weighted average duration of defined benefit plan obligations was 12.9 years in the fiscal year
ended March 31, 2023 and 12.8 years in the fiscal year ended March 31, 2024.

－

52 －

(iii) Reconciliation of Fair Value of Plan Assets
Increase or decrease in the fair value of plan assets is as follows:
Fiscal year ended
March 31, 2023

Fiscal year ended
March 31, 2024

Fiscal year ended
March 31, 2024

Millions of yen

Millions of yen

Thousands of U.S.
dollars

Balance of fair value of plan assets atthe beginning of the fiscal year
Interest revenue

38,10332,415

214,090

149

264

1,745

(25)

276

1,821

940
(1,589)864(1,440)5,708(9,508)(5,137)

-

-

(25)

(141)

(933)

32,41532,239212,923

Remeasurement
Return on plan assets
Contributions paid by the employer
Benefits paid
Transfer to liabilities associated withdisposal group classified as held forsale classified as held for sale
Other
Balance of fair value of plan assets at
the end of the fiscal year

Contributions to defined benefit plans are determined by performing an actuarial review
periodically so that balanced budgets can be maintained in the future. In the actuarial review, theGroup reviews assumptions related to the determination of contributions (such as expected rate ofinterest, expected mortality rate and expected withdrawal rate) and verifies the appropriateness ofcontributions determined.
The Group will make contributions of ¥1,287 million ($8,500 thousand) in the fiscal year ending
March 31, 2025.
(iv) Items of Plan Assets
Plan assets consisted of the following items.
As of March 31, 2023
Assets forwhich
activemarketprices areavailable

Assets forwhich
activemarketprices arenotavailable

Millionsof yenCash and cash
3,391
equivalents
Equity instruments
Domestic equity
1,411
securities
Foreign equity
3,504
securities
Debt instruments
Domestic bonds
8,330
Foreign bonds
7,889
General accounts of life
insurance
Alternative investments*
Total
24,525*Alternative investments include hedge funds.

As of March 31, 2024

Total

Assets forwhich
activemarketprices areavailable

Assets forwhich
activemarketprices arenotavailable

Total

Millions

Millions

Millions

Millions

Millionsof yenof yenof yenof yenof yen

-

3,391

6,950

-

6,950

-

1,411

360

-

360

-

3,504

4,081

-

4,081

-

8,330
7,889

629
11,382-629
11,382

434

434

-

654

654

7,457
7,891

7,457
32,41523,402

8,182
8,836

8,182
32,239－53 －As of March 31, 2024
Assets for
Assets for
which
which
activeactivemarketTotal
marketprices are
prices arenotavailable
available
Thousands
Thousands
Thousandsof U.S.
of U.S.
of U.S.
dollars
dollars
dollars
Cash and cash
equivalents
Equity instruments
Domestic equity
securities
Foreign equity
securities
Debt instruments
Domestic bonds
Foreign bonds
General accounts of life
insurance
Alternative investments*
Total

45,901-45,901

-

-

-

2,380

-

2,380

26,951-

26,951

4,154
75,176-

4,154
75,176

-

4,321

4,321

154,562

54,04058,36054,040212,923*Alternative investments include hedge funds.

(v) Main Component Used for Actuarial Assumption
As of March 31, 2023

As of March 31, 2024%%

Discount rates (weighted average)

1.08

1.35

(vi) Sensitivity Analysis
In the fiscal year ended March 31, 2024, a 0.5% increase (decrease) in the discount rate used in
actuarial calculation would have resulted in a decrease (increase) in the present value of defined
benefit plan obligations by ¥2,045 million ($13,506 thousand). This provisional calculation
assumes that variables other than the assumptions used in the calculation are constant. In reality,
since individual assumptions are affected by changes in economic indicators and conditions at thesame time, the assumptions are expected to change independently or in a correlated fashion, andthe actual effects of such changes on defined benefit plan obligations may differ from the expected
effects.
3) Defined Contribution Plans
The amount recognized as expenses in relation to defined contribution plans was ¥2,008 million in
the fiscal year ended March 31, 2023 and ¥2,287 million ($15,102 thousand) in the fiscal year ended
March 31, 2024.
4) Employee Benefits Expense
The total amount of employee benefits expense included in “cost of sales” and “selling, general andadministrative expenses” in the consolidated statement of profit or loss in the fiscal year ended March
31, 2023 and the fiscal year ended March 31, 2024 was ¥3,610 million and ¥4,088 million ($27,003
thousand), respectively.

－

54 －

(23) Provisions
Increase or decrease in provisions are the following.
Provision for loss on businessrestructuring

Allowance for dismantling
and removal

Other

Millions of yen

Millions of yen

Millions of yen

772

8,093

31

269

469

-

Decrease (used for purposes)

(100)

(217)

(0)

As of March 31, 2024

941

8,346

31

Provision for loss on businessrestructuring

Allowance for dismantling
and removal

Thousands of U.S. dollars

Thousands of U.S. dollars Thousands of U.S. dollars

As of April 1, 2023
Increase

Other

5,102

53,453

206

1,775

3,098

-

Decrease (used for purposes)(662)(1,431)(2)

As of March 31, 2024

6,215

55,120204

As of April 1, 2023
Increase

Provision for Loss on Business Restructuring
To provide for losses due to business restructuring that are expected to arise for the future, theestimated loss is recorded.
Allowance for dismantling and removal
To provide for expenses for the dismantling and removal of manufacturing facilities, etc., that are
expected to arise in the future, an estimated amount of expenses at the end of the current fiscal year isrecorded.
The payment period may change due to a review of future dismantling and removal plans.

Provisions on consolidated statement of financial position consisted of the following:
As of March 31,2023

As of March 31,2024

As of March 31,
2024

Millions of yen

Millions of yen

Thousands of U.S.
dollars

Current liabilities
Non-Current liabilities

1,474
7,423

1,959
7,359

12,93548,603

Total

8,897

9,318

61,539－55 －(24) Other Liabilities
Other liabilities include the following items.

Other current liabilities
Accrued bonuses

As of March 31,2023

As of March 31,2024

As of March 31,
2024

Millions of yen

Millions of yen

Thousands of U.S.
dollars

3,835

4,047

26,732

Accrued consumption taxes
Other

2,797
2,777

1,276
4,096

8,425
27,052

Total

9,410

9,419

62,209

4,373

2,775

18,327

4,373

2,775

18,327

Other non-current assets
Other
Total

(25) Equity and Other Equity Items
1) Share Capital and Capital Surplus
Capital surplus consists of legal capital surplus and other capital surplus.
The Companies Act of Japan (hereinafter the “Companies Act”) stipulates that at least half of the payment orcontribution at the share issue shall be credited to share capital, and the remaining amount may be recorded aslegal capital surplus included in capital surplus. In addition, under the Companies Act, legal capital surplus may
be credited to share capital by resolution of the general meeting of shareholders.
Increase or decrease in the number of authorized shares and the number of issued shares are as follows:
Number of shares authorized

Number of shares issued

As of April 1, 2022

696,061,000

226,126,145

Increase/Decrease-(17,726,145)

As of March 31, 2023
Increase/Decrease

696,061,000-

208,400,000-

As of March 31, 2024

696,061,000

208,400,000(Note)All shares issued by the Company are ordinary shares with no rights limitations and without par value and restricted
shares. Issued shares are fully paid.
Increase or decrease during the current consolidated fiscal year is due to the cancellation of treasury stock.

2) Treasury Shares
The Companies Act stipulates that entities may determine the number of shares to be acquired, the total amountof acquisition price, etc. and acquire treasury shares by resolution of the general meeting of shareholders, to theextent of the distributable amount. Moreover, in the case of acquisition through market transactions or a takeoverbid, treasury shares may be acquired by resolution of the Board of Directors within the requirements prescribedin the Companies Act in accordance with the provisions of the Articles of Incorporation.
Increase or decrease in the number of treasury shares is as follows:
Number of shares
As of April 1, 2022
Increase/Decrease

11,047,900(10,233,673)

As of March 31, 2023
Increase/Decrease814,227(49,817)

As of March 31, 2024

764,410(Note)

Increase or decrease during the period is mainly due to the cancellation of treasury stock and the disposal of treasury
stock as the restricted share-based remuneration.

－

56 －

3) Retained Earnings
Retained earnings consist of legal retained earnings and other retained earnings.
The Companies Act stipulates that one-tenth of the amount paid as dividends of surplus shall be reserved as legal
capital surplus or legal retained earnings until the sum of legal capital surplus included in capital surplus andlegal retained earnings included in retained earnings reaches one quarter of share capital. Accumulated legal
retained earnings may be appropriated to cover a deficit. It is specified that legal retained earnings may bereversed by resolution of the general meeting of shareholders.

4) Other Components of Equity
Fiscal year ended March 31, 2023 (April 1, 2022 to March 31, 2023)（Millions of yen）

As of April
1, 2022
Other
comprehens
ive income
Total
comprehensi
ve income
Share-based
remuneration planTransferfrom othercomponentsof equity toretainedearnings
Changes innoncontrollinginterests
Totaltransactions
with owners,
etc.
As of March
31, 2023

Net change infinancialassetsmeasured atfair value
through othercomprehensiv
e income

Net change infair value on
cash flow
hedgesExchangedifferenceson translationof foreign
operations

8,713

(2)

17,784-(114)

26,381(12)

2

12,001703-

12,695(12)2

12,001703-

12,695

-

-

-

-

(0)

(0)

226

-

-

(703)

-

(477)

(3)

-

113

-

-

111

223

-

113

(703)

(0)

(367)

8,925

-

29,898-(115)

38,709－57 －Remeasurements ofdefinedbenefitplans

Restricted
SharesTotal

Fiscal year ended March 31, 2024 (April 1, 2023 to March 31, 2024)（Millions of yen）

As of April
1, 2023
Other
comprehens
ive income
Total
comprehensi
ve income
Share-based
remuneration planTransferfrom othercomponentsof equity toretainedearnings
Changes innoncontrollinginterests
Totaltransactions
with owners,
etc.
As of March
31, 2024

Net change infinancialassetsmeasured atfair value
through othercomprehensiv
e income

Net change infair value on
cash flow
hedgesExchangedifferenceson translationof foreign
operations

8,925

-

29,898-(115)

38,70910,766-

20,978989-

32,733

10,766-

20,978989-

32,733

-

-

-

-

115

115

79

-

-

(989)

-

(910)

-

-

-

-

-

-

79

-

-

(989)

115

(795)

19,770-50,876--70,646－58 －Remeasurements ofdefinedbenefitplans

Restricted
SharesTotal

Fiscal year ended March 31, 2024 (April 1, 2023 to March 31, 2024)(Thousands of U.S. dollars)

As of April
1, 2023
Other
comprehens
ive income
Total
comprehensi
ve income
Share-based
remuneration planTransferfrom othercomponentsof equity toretainedearnings
Changes innoncontrollinginterests
Totaltransactions
with owners,
etc.
As of March
31, 2024

Net change infinancialassetsmeasured atfair value
through othercomprehensiv
e income

Net change infair value on
cash flow
hedgesExchangedifferenceson translationof foreign
operations

58,944-

197,467-(756)

255,654

71,102-

138,550

6,533-

216,185

71,102-

138,550

6,533-

216,185

-

-

-

-

756

756

523

-

-

(6,533)-(6,009)

-

-

-

-

-

-

523

-

-

(6,533)756(5,253)130.570-

336,017--466,586

Remeasurements ofdefinedbenefitplans

Restricted
SharesTotal(a) Net Change in Financial Assets Measured at Fair Value through Other Comprehensive Income
It represents valuation differences on fair value of equity instruments measured at fair value throughother comprehensive income.
(b) Net Change in Fair Value of Cash Flow Hedges
It represents change in profit or loss on valuation of derivatives as hedging instruments that wererecorded in the statement of comprehensive income on and before the date of cessation of hedge
accounting.
(c) Exchange Differences on Translation of Foreign Operations
They represent translation differences on foreign operations’ financial statements.
(d) Remeasurements of Defined Benefit Liabilities (Assets)
Remeasurements of defined benefit liabilities (assets) are changes in actuarial differences, return onplan assets (excluding the amount included in interest revenue) and the effect of the asset ceiling(excluding the amount included in interest revenue). Actuarial differences are adjustments based on
actual results related to defined benefit plan obligations (differences between actuarial assumptions at
the beginning of the period and actual results) and the effect of changes in actuarial assumptions.
These items are recognized in other comprehensive income when they arise, and immediatelytransferred from other components of equity to retained earnings.
－

59 －(e) Restricted Shares
Under the restricted share-based remuneration plan, monetary remuneration to be used as contributed
properties for restricted shares is provided. The amount equivalent to fair value of remuneration
determined at the initial recognition is recorded in share capital, and recognized as the amount debitedto other components of equity. Over the vesting period, other components of equity recognized as thedebited amount are deducted at the time when remuneration cost is recognized.
Details of the restricted share-based remuneration plan are provided in the note “(33) Share-based
remuneration.”

－

60 －

(26) Dividends
The amounts of dividends paid are as follows:
Fiscal year ended March 31, 2023 (April 1, 2022 to March 31, 2023)
Resolution
Ordinary General
Meeting of
Shareholders on
June 17, 2022
Board of Directors
Meeting on
October 31, 2022

Class ofsharesTotal amount ofdividends

Dividends
per share

Record date

Effective
date ofdividends

Source ofdividends

Ordinary
Shares¥7,528 million¥35

March 31,2022

June 20,2022

Retained
Earnings

Ordinary
Shares¥7,265 million¥35

September
30, 2022

December
1, 2022

Retained
Earnings

Fiscal year ended March 31, 2024 (April 1, 2023 to March 31, 2024)
Resolution

Class ofsharesTotal amount ofdividends

Dividends
per share

Record date

Source ofdividends

Ordinary General
Meeting of
Shareholders on
June 16, 2023

Effective
date ofdividends

Ordinary
Shares¥ 7,266 million($ 47,986 thousand)¥35($0.23)

March 31,2023

June 19,2023

Retained
Earnings

Dividends of which record dates belong to the current fiscal year and of which effective dates of dividends fall
after the end of the current fiscal year are as follows:
Fiscal year ended March 31, 2023 (April 1, 2022 to March 31, 2023)
Resolution

Class ofsharesTotal amount ofdividends

Dividends
per share

Record date

Effective
date ofdividends

Source ofdividends

Ordinary General
Meeting of
Shareholders on
June 16, 2023

Ordinary
Shares¥7,266 million($ 47,986 thousand)¥35($0.23)

March 31,2023

June 19,2023

Retained
Earnings

Fiscal year ended March 31, 2024 (April 1, 2023 to March 31, 2024)
Not Applicable

－

61 －

(27) Revenue(1) Disaggregation of Revenue
Regarding the revenue arising from contracts with the Group’s customers, the breakdown of revenue into
domestic and overseas and its relation to the reportable segments are as follows.

Fiscal year ended March 31, 2023 (April 1, 2022 to March 31, 2023)(Millions of yen)

The Reportable
Segments

Digital Solutions
Semiconductor
Materials
Display Materials
Edge Computing
Materials
Life Sciences
Plastics

Domestic
26,625

Overseas
143,814

Total
170,439

20,421

105,962

126,383

2,785

33,80636,590

3,419

4,046

7,466

54,66057,701
15,656
154,641-

71,818
38,101
506
254,239-

126,478
95,802
16,162408,880-

154,641

254,239

408,880

Other
Total
Adjustment
Amount Recorded in the Consolidated
Financial Statements

Fiscal year ended March 31, 2024 (April 1, 2023 to March 31, 2024)(Millions of yen)

The Reportable
Segments

Digital Solutions
Semiconductor
Materials
Display Materials
Edge Computing
Materials
Life Sciences
Plastics

Domestic
27,304

Overseas
140,810

19,472

99,398118,870

4,444

38,091

42,535

3,389

3,321

6,710

59,51059,554
13,991
160,360-

70,18233,278244,271-

129,693
92,832
13,991
404,631-

160,360

244.271404,631

Other
Total
Adjustment
Amount Recorded in the Consolidated
Financial Statements

－

62 －

Total
168,115

Fiscal year ended March 31, 2024 (April 1, 2023 to March 31, 2024)(Thousands of U.S. dollars)
Domestic
Overseas
Total
180,333
929,995
1,110,328
Digital Solutions
Semiconductor
128,602656,481785,084
Materials
Display Materials
29,349251,576
280,925
The Reportable
Segments
Edge Computing
22,382
21,93744,319Materials
393,040
463,325
856,565
Life Sciences
393,330
219,790
613,120
Plastics
Other
92,406
92,406
Total
1,059,109
1,613,310
2,672,419
Adjustment
Amount Recorded in the Consolidated
1,059,109
1,613,310
2,672,419
Financial Statements

1) Digital Solutions Business
In Digital Solutions business, the Group manufactures and sells semiconductor materials, display
materials, and products related to edge computing, etc.
For the sales contracts on products and merchandise, the Group recognizes revenue upon delivery
because the control of the products and merchandise is considered to be transferred to the customer andthe performance obligation is satisfied by delivery.
2) Life Sciences Business(i) Manufacturing and sale of in-vitro diagnostics and research reagents, related materials, andbioprocess materials
For the sales contracts on products and merchandise, the Group recognizes revenue upon delivery
because the control of the products and merchandise is considered to be transferred to the customer
and the performance obligation is satisfied by delivery.
(ii) Contract development and manufacturing for bioprocess, etc.
The Group renders services in the contract research and manufacturing businesses related tobioprocess, etc.
For rendering of services, the Group recognizes revenue at over time with fulfillment of
performance obligation based on the contract between the Group and the customer.
3) Plastics Business
In Plastics business, the Group manufactures and sells ABS and other resins for automobiles, officeequipment, and amusement applications, etc.
For the sales contracts on products and merchandise, the Group recognizes revenue upon delivery
because the control of the products and merchandise is considered to be transferred to the customer andthe performance obligation is satisfied by delivery.

－

63 －

(2) Liabilities Arising from Contracts with the Customers
Contract liabilities primarily consist of consideration received from customers before performanceobligations are satisfied for biologics Contract Development and Manufacturing Organization forBiopharmaceuticals (CDMO) services in the Life Sciences Business. Said contract liabilities aretransferred to revenue as the corresponding performance obligation is satisfied. Among the beginningbalance of contract liabilities for the current fiscal year, the amount of revenue recognized is ¥15,218
million ($100,512 thousand).
The amount of revenue recognized from the performance obligations that were satisfied (or partiallysatisfied) in previous fiscal years is insignificant in the current fiscal year.
(3) Transaction Price Allocated to the Remaining Performance Obligations
The Group applies the practical expedient and omits information on the remaining performance obligations
because there are no significant transactions with initial expected contractual terms exceeding one year.
There are no significant amounts of consideration from contracts with customers that are not included intransaction prices.
The consideration does not include a significant financing component, since the consideration fortransaction prices is mainly collected within one year from the time of delivery of products andmerchandise to customers or the agreement based on the contract such as milestone achievement.
(4) Assets Recognized from the Costs of Obtaining or Fulfilling Contracts with Customers
There is no significance in the amount of assets recognized from the costs incurred to obtain or fulfill acontract with a customer in the current fiscal year.
The Group applies the practical expedient of recognizing the incremental costs of obtaining a contract as
an expense when incurred if the amortization period of the asset that the Group otherwise would haverecognized is one year or less.

－

64 －

(28) Selling, General and Administrative Expenses
1) Major items in selling, general and administrative expenses are as follows:

Transportation andwarehousing expenses
Salaries and allowances

Fiscal year ended March 31,
2023

Fiscal year ended March 31,
2024

Fiscal year ended March 31,
2024

Millions of yen

Millions of yen

Thousands of U.S. dollars

8,878

7,320

48,34831,82936,334

239,969

Retirement benefit
expenses

1,526

1,288

8,508

Experiment andresearch expenses

23,18225,924

171,216

Depreciation
Supplies expenses

9,287
479

9,413
516

62,167
3,409

Business consignment
expenses

7,500

6,251

41,287

Other

27,16738,700255,595

109,847

125,746

830,500

Total2) Amount of research and development expense included in general and administrative expenses andmanufacturing costs
Fiscal year ended March 31,
2023

Fiscal year ended March 31,
2024

Millions of yen
Research anddevelopment expense

Millions of yen－

Thousands of U.S. dollars
31,80826,95165 －Fiscal year ended March 31,
2024

210,082

(29) Other Operating Income and Expenses
Other operating income consisted of as follows:
Fiscal year ended March 31,
2023

Fiscal year ended March 31,
2024

Fiscal year ended March 31,
2024

Millions of yen

Millions of yen

Thousands of U.S. dollars
2,029

Gain on sales of noncurrent assets

85

307

372

376

2,484

3,429

-

-

Gain on sale of shares ofsubsidiaries *2

1,020

-

-

Other

2,166

2,047

13,521

7,071

2,730

18,034

Rent income
Remeasured gains on
business combinations *1

Total*1 Remeasured gains on business combinations are described in "Notes of Consolidated Financial Statements (7)Business Combinations and Acquisition of Non-controlling Interest."*2 Gain on sale of shares of subsidiaries in fiscal year ended March 31, 2023 is the gain on the transfer of the
Elastomers Business.
Other operating expenses consisted of as follows:
Fiscal year ended March 31,
2023

Fiscal year ended March 31,
2024

Fiscal year ended March 31,
2024

Millions of yen

Millions of yen

Thousands of U.S. dollars

Loss on abandonmentof non-current assets

163

1,173

7,745

Loss on sales of noncurrent assets

264

191

1,265

Impairment loss
Other

7,801
2,801

2,191
4,739

14,47031,298

Total

11,0298,294

54,777－66 －(30) Financial Income and Costs
Financial income consisted of the following:
Fiscal year ended March 31,
2023

Fiscal year ended March 31,
2024

Millions of yen

Millions of yen

Interest income
Financial assets measured at

Fiscal year ended March 31,
2024
Thousands of U.S. dollars

351

894

5,907

Equity financial assets
measured at fair value through

434

331

2,188

other comprehensive income
Foreign exchange gains

2,738

1,353

8,935

Total

3,523

2,579

17,031amortized cost
Dividend income

Financial costs consisted of the following:
Fiscal year ended March 31,
2023

Fiscal year ended March 31,
2024

Fiscal year ended March 31,
2024

Millions of yen

Millions of yen

Thousands of U.S. dollars

Interest expenses
Financial liabilities measured

2,613

at amortized cost

5,961

39,371

Lease liabilities

434

390

2,578

Total

3,047

6,352

41,950－67 －(31) Other Comprehensive Income
Changes in items of other comprehensive income are shown below:
Amount incurred and reclassification for profit or loss in items of other comprehensive income, and effects
of income tax are shown below:
Fiscal year ended March 31, 2023 (April 1, 2022 to March 31, 2023)(Millions of yen)Amountincurred

Reclassificati
onbefore tax

Income tax

Net of tax

177

-

177

(295)

(118)

1,058

-

1,058

(324)

734

1,235

-

1,235

(619)

616

5

-

5

-

5

12,743(1,020)11,723

312

12,035

414

-

414

-

414

13,162(1,020)12,142

312

12,455

14,397(1,020)13,377(307)

13,071Other comprehensive income thatwill not be reclassified to profit orloss

Net change in financial assets
measured at fair value throughother comprehensive income
Remeasurements of defined
benefit plans
Total

Items that may be reclassified to
profit or loss
Cash flow hedges

Exchange differences ontranslation of foreign
operations
Share of other comprehensive
income of investments
accounted for using the equity
methodTotal
Total

Fiscal year ended March 31, 2024 (April 1, 2023 to March 31, 2024)(Millions of yen)Amountincurred

Reclassificati
onbefore tax

Income tax

Net of tax

15,579-15,579(4,839)10,740

1,607

-

1,607

(492)

1,115

17,186-

17,186(5,331)

11,855

-

-

-

-

-

21,264-

21,264-

21,264

188

-

188

-

188

21,452-

21,452-

21,452-

38,638(5,331)33,306

Other comprehensive income thatwill not be reclassified to profit orloss

Net change in financial assets
measured at fair value throughother comprehensive income
Remeasurements of defined
benefit plans
Total

Items that may be reclassified to
profit or loss
Cash flow hedges

Exchange differences ontranslation of foreign
operations
Share of other comprehensive
income of investments
accounted for using the equity
methodTotal
Total

38,638－68 －Fiscal year ended March 31, 2023 (April 1, 2022 to March 31, 2023)(Thousands of U.S. dollars)
Amountincurred

Reclassificati
onbefore tax

Income tax

Net of tax

Other comprehensive income thatwill not be reclassified to profit orloss

Net change in financial assets
measured at fair value throughother comprehensive income
Remeasurements of defined
benefit plans
Total

102,894-

102,894(31,961)

70,933

10,612-

10,612(3,249)7,362

113,505-

113,505(35,210)

78,295

-

-

-

-

-

140,441-

140,441-

140,441

1,239

-

1,239

-

1,239

141,680-

141,680-

141,680

255,185-

255,185(35,210)

219,975

Items that may be reclassified to
profit or loss
Cash flow hedges

Exchange differences ontranslation of foreign
operations
Share of other comprehensive
income of investments
accounted for using the equity
method
Total
Total

－

69 －

(32) Earnings per Share

Fiscal year ended
March 31, 2023

Fiscal year ended
March 31, 2024

Fiscal year ended
March 31, 2024

¥75.56(¥26.74)($0.18)¥15,784 million(¥5,551 million)($36,663 thousand)

208,907

207,598

207,598¥75.47(¥26.74)($0.18)

Increase in common shares due to stock
options (1,000 shares)

237

-

-

Average diluted shares outstanding during theyear (1,000 shares)

209,144

207,598

207,598

1) Basic earnings per share (Loss)(Basis of calculation)
Profit attributableto owners of parent (Loss)
Average shares outstanding during the year
(1,000 shares)
2) Diluted earnings per share (Loss)(Basis of calculation)(Note) 1. There are 192,000 dilutive potential common shares, which were excluded from the calculation of net loss per diluted
share due to the reverse dilution effect in the current fiscal year.
2. On June 27, 2024, the Company conducted a consolidation of shares at a ratio of 1 share for every 88 million shares of theCompany.If the consolidation of shares were carried out at the beginning of fiscal 2022, the basic earnings per share anddiluted earnings per share would be ¥7,892.13 million and ¥(2,775.56) million ($(18,331.42) thousand), respectively.

(33) Share-based Remuneration
1) Stock Options(i) Overview of Share-based Remuneration Plan
The Group operated an equity-settled share-based remuneration plan where it received services fromdirectors, executive officers, and employees and paid equity instruments (options) as consideration thereof
until June 2017.
The fair value on the date the option was granted under the plan is recognized as an expense over the option’s
vesting period and the same amount is recorded as an increase of equity. The plan was terminated in June2017 (however, share acquisition rights already granted as share-based stock options to directors, etc. thathave not been exercised will be continued).
(ii) Number and Weighted Average Exercise Prices of Stock Options
Fiscal year ended March 31, 2023

Shares263,600(52,300)
211,300

Weighted
average exercise
price
Yen
1
1
1

211,300

1

Number of shares

Outstanding at the beginning
GrantedExercised
Forfeited
ExpiredOutstanding at the end
Exercisable at the end

Fiscal year ended March 31, 2024

－

70 －

Shares211,300(60,000)
151,300

Weighted
average
exercise price
Yen
1
1
1

Weighted
average
exercise price
U.S. dollars
0.01
0.01
0.01

151,300

1

0.01

Number of shares

The weighted average share price as of the exercise date of stock options exercised during the period was ¥3,284
and ¥4,016 ($26.52) in the fiscal years ended March 31, 2023 and 2024, respectively.
In the fiscal years ended March 31, 2023 and 2024, the exercise price of unexercised stock options was ¥1 each.
The weighted average remaining contract terms in the fiscal years ended March 31, 2023 and 2024 were 8.9
years and 7.6 years, respectively, for the unexercised balance at the end of the fiscal year, and 8.9 years and 7.6
years, respectively, for the exercisable balance at the end of the fiscal year.
2) Restricted Share-based Remuneration Plan
The Group employs the restricted share-based remuneration plan in order to further promote sharing of values
with shareholders and establish a remuneration structure that contributes to sustained improvement in corporate
value in the medium to long term. Under this plan, to grant restricted shares to directors, excluding outside
directors, and executive officers (hereinafter “Eligible Directors, etc.”), the Company is to provide the Eligible
Directors, etc. with claims for monetary remuneration in principle in each period and have them contribute theseclaims in kind as contributed properties to the Company. Accordingly, the Company is to issue or dispose ofordinary shares of the Company to the Eligible Directors, etc. and make them hold the shares.
The Company enters into an agreement with Eligible Directors, etc. for allotment of restricted shares, andEligible Directors, etc. cannot transfer, pledge or dispose of in any other way shares granted under the allotment
agreement at will during a given period of time stipulated in the agreement (hereinafter the “Transfer Restriction
Period”) (hereinafter, the “Transfer Restriction”). The Transfer Restriction is lifted for all shares held by Eligible
Directors, etc. when the Transfer Restriction Period expires, on the condition that the Eligible Directors, etc.
continued to hold a position of directors, executive officers, audit & supervisory board members, employees, or
any other equivalent position of the Company or its subsidiaries during the Transfer Restriction Period. On theother hand, under this structure, shares for which the Transfer Restriction has not been lifted at the time when
the Transfer Restriction Period expires are acquired by the Company without any payment in principle.
3) Performance Share Unit Remuneration Plan
The Company has adopted the performance share unit remuneration plan for directors and executive officers of
the Company and officers of certain subsidiaries of the Company, under which the number of shares to bedelivered and the amount of individual cash payments are adjusted according to the attainment level ofpredetermined performance targets. (hereinafter referred to as” Eligible Directors, Executive Officers andSubsidiaries Officers”).
The Eligible Directors, Executive Officers and Subsidiaries Officers shall, at the beginning of the performance
evaluation period, be granted the basic number of share units determined by position, by resolution of theBoard of Directors based on the deliberation and report of the Compensation Advisory Committee of theCompany, except for cases of transfer to a competitor which is not approved by the Company or cases of
disciplinary action.
The number of the Company shares to be paid to Eligible Directors, Executive Officers and Subsidiaries
Officers and the amount of cash paid shall be determined by multiplying the base number of share units by thepayment rate (varying from 0% to 200%) corresponding to the degree of achievement of the target value of theconsolidated performance indicator (average consolidated ROE for fiscal year 2023 and fiscal year 2024) set in
fiscal year 2021. Out of the number calculated by multiplying the base number of share units for the Company
shares granted to each Eligible Director, Executive Officer and Subsidiaries Officers by the allocation rate
determined after the end of the performance evaluation period, 50% is calculated as the number of individual
shares to be allocated and the remaining amount is calculated as the amount of individual cash to be paid.
The fair value in the plan is estimated based on the market price of the Company’s shares, which is not revisedin consideration of the estimated dividend. The fair value at the reporting date for the fiscal year ended March
31, 2023 was ¥3,531 and, the fiscal year ended March 31,2024 was ¥3,544 ($23.41).

－

71 －

4) Share-based Remuneration Expense
The breakdown of share-based remuneration expenses in the consolidated statement of profit or loss is asfollows:
The amount of share-based remuneration expense is included in “selling, general and administrative
expenses”.
Fiscal year ended March 31,
2023

Fiscal year ended March 31,
2024

Fiscal year ended March 31,
2024

Millions of yen

Millions of yen

Thousands of U.S. dollars

Equity-settled(Restricted Share-based Remuneration Plan)
Cash-settled(Performance Share Unit Remuneration Plan)
Equity-settled(Performance Share Unit Remuneration Plan)
Total

476

113

747

169

405

2,673

219

193

1,274

863

711

4,694

5) Liabilities Arising from Share-based Payment
The liabilities included in “Other current liabilities” in the consolidated statement of the financial position are
as follows:

Carrying amount of liabilities

Fiscal year ended March 31,
2023

Fiscal year ended March 31,
2024

Fiscal year ended March 31,
2024

Millions of yen

Millions of yen

Thousands of U.S. dollars

341

－

745

72 －

4,922

(34) Financial Instruments
1) Capital Management Policy
The Group considers it vitally important to improve corporate performance on a long-term basis and achieve
improvement in corporate value in the medium to long term by strengthening its research and development
activities from a long-term viewpoint and enhancing competitiveness through development of new businesses.
For capital efficiency, the Group monitors ROE on a timely basis.
2) Financial Risks
The Group is exposed to financial risks related to operating activities (market risk, credit risk and liquidityrisk), and conducts risk management based on a certain policy to avoid or mitigate effects of the risks. For
fund management, approval of the Company’s Board of Directors is received in principle at the beginning ofeach period. Transactions and risk management during the period are principally conducted based on internalmanagement regulations. The Group uses derivatives to avert risks described below, and as its policy, does not
perform any speculative transaction.
(i) Market Risks(a) Exchange Rate Risks
The Group operates business globally and sells products manufactured by the Company and eachsubsidiary and others abroad. Thus, the Group is exposed to the risk that profit or loss, cash flows, etc. areaffected by fluctuations in exchange rates.
To avoid exchange rate risks, the Group mainly utilizes foreign exchange forward contracts as derivativetransactions for trade receivables and payables denominated in foreign currencies.
The Company’s responsible department manages risks in accordance with the derivative transaction
management regulations that specify authority for transactions, maximum amount, etc. and reportsmonthly trading results to responsible directors.
Details of currency derivatives are as follows:
Derivative Transactions to which Hedge Accounting is Not Applied
As of March 31, 2023

U.S. dollar

Later than one
year

Millions ofyenMillions of yen Millions of yen Millions of yen Millions of yen Millions of yen

Forward exchange contracts
Purchase
Sell
5,240
Total

As of March 31, 2024

Contracted
Amount5,240

Fair value

Fair value

(48)

6,516

-

(240)

-

(48)

6,516

-

(240)

Contracted
Later than one
Fair value
Amountyear
Thousands of U.S. Thousands of U.S. Thousands of U.S.
U.S. dollar
dollars
dollars
dollars
Forward exchange contracts
Purchase
Sell
43,037(1,583)43,037

Later than one
year-

As of March 31, 2024

Total

Contracted
Amount-(1,583)－73 －As of March 31, 2023

Currency swap
U.S. dollars
EUR
Total

As of March 31, 2024

Assumedprincipal

Later than one
year

Contracted
AmountMillions ofyenMillions of yen Millions of yen Millions of yen Millions of yen Millions of yen

Fair value

Later than one
year

Fair value

78,2492,332

74,910-(2,360)(10)

87,136979

87,136-(13,341)(119)

80,58074,910(2,370)88,116

87,136(13,460)

As of March 31, 2024
AssumedLater than one
Fair value
principal
year
Thousands of U.S. Thousands of U.S. Thousands of U.S.
dollars
dollars
dollars
Currency swap
U.S. dollars
EUR
Total

575,500
6,469

575,500-(88,114)(786)

581,969

575,500(88,900)

Although the Group does not apply hedge accounting to these derivative transactions, it considers that thetransactions effectively offset effects of exchange fluctuations.
Exposure to Exchange Rate Risks
The Group’s exposure of Japanese yen and Korean won as functional currencies against the US dollar, the major
foreign currency, is as follows. These amounts are after deduction of amounts of exchange rate risks hedged
through derivative transactions, etc.
Functional Currency

As of March 31, 2023

As of March 31, 2024

As of March 31, 2024

Millions of yen

Millions of yen

Thousands of U.S. dollars

Japanese yen

6,061

12,12180,056

Korean won

2,334

2,876

18,996

Foreign Exchange Sensitivity Analysis
With regard to foreign currency receivables and payables held by the Group at the end of each fiscal year, effects
of 1% depreciation of the US dollar against each functional currency on profit before tax in the consolidated
statement of profit or loss are as follows. If each currency moves inversely, this will have effects opposite to andat the same amount as the table below. The calculation is based on the assumption that currencies other than thecurrency used do not fluctuate.
Functional Currency
Japanese yen (weak U.S. dollar)
Korean won (weak U.S. dollar)

As of March 31, 2023
Millions of yen

As of March 31, 2024
Millions of yen

(61)
(23)

－

74 －

(121)
(29)

As of March 31, 2024
Thousands of U.S. dollars
(801)
(190)

(b) Equity Price Risks
Equity instruments held by the Group are principally shares of companies with which the Group hasbusiness relationships. These shares were acquired to expand businesses mutually and enhance thetransaction relationships, and the Group does not hold the shares for the purpose of short-term trading.
Equity instruments include listed shares and unlisted shares. The Group periodically monitors market value,financial conditions of the issuers (business partners), etc. and reviews the ownership in light of therelationships with the business partners.
If the share price increases (decreases) by 5% with other changing factors remaining constant, othercomponents of equity (net of related tax effects) will increase (decrease) by ¥497 million ($3,280 thousand)for the fiscal year ended March 31, 2024 (fiscal year ended March 31, 2023: ¥440 million) due to the change
in fair value.
(c) Interest Rate Risks
The Group is exposed to interest rate fluctuation risks because it receives variable-rate loans from financial
institutions.
For variable-rate, long-term borrowings involving interest rate fluctuation risks, the Group mitigates therisks by fixing cash flows using interest rate swap transactions, and applies cash flow hedges.
Exposure to interest rate fluctuation risks for the Group is limited, and effects of interest rate fluctuations
are insignificant.
(ii) Credit Risks
The Group’s trade and other receivables, other financial assets, etc. are exposed to credit risks of customers.
The Group establishes terms of collection and credit limit for transaction partners. In addition, the Groupconfirms the credit status periodically by obtaining the latest credit report on transaction partners from externalorganizations where necessary and analyzing the report as well as past results of collection and other factors.
If it is considered that there is any change or abnormality in the credit status as a result of the confirmation,measures for protection of receivables are taken appropriately, including change in the credit limit,
modification of the terms of collection or obtaining transaction credit insurance.
In the execution of derivative transactions, the Group conducts transactions only with financial institutions
with high credit ratings in principle to mitigate credit risks.
The Group classifies receivables, etc. based on the nature of the credit risk to calculate loss allowance.
In terms of trade receivables that do not include significant financial components, the loss allowance is always
determined as the same amount as lifetime expected credit loss (simplified approach). The amount of expectedcredit loss is calculated by classifying receivables, etc. according to the nature of the credit risk of thecounterparty and multiplying the receivables amount by the allowance rate set according to the classification.
This allowance rate is set in view of the probability of future occurrence of credit loss based on external credit
reports.
In terms of other receivables, etc., the loss allowance is measured as the same amount as the 12-month expectedcredit loss in principle. The amount of expected credit loss is calculated by multiplying the gross carrying
amount by the allowance rate established as stated above, in accordance with the general approach.
Of other receivables, etc., in terms of assets for which the credit risk has significantly increased from the initialrecognition, including the case where the receivable is past due for payment, and credit-impaired financial
assets, the loss allowance is recognized at the same amount as lifetime expected credit loss. In doing so, theamount of expected credit loss is determined as the difference between the present value, which is calculatedby discounting future estimated cash flows using the original effective interest rate for the asset, and the grosscarrying amount.
The Gross carrying amount and loss allowance of financial assets for which loss allowance is recognized are
as shown below. Time deposits are excluded from the table below as those are considered to be not exposed tocredit risks.

－

75 －

Trade and other receivables
Grosscarrying
amountAs of March Millions ofyen
31, 2023
As of March Millions ofyen
31, 2024

Measured at
lifetime

Measured at 12month expected

Other financial assets

Measured by

Measured at 12-month

expected credit simplified approach
lossescredit losses

Measured at lifetime

expected credit losses expected credit losses

8,404

-

71,20149

310,705-80,243

69

2

Thousandsof U.S.
70,699529,969455
15
dollars* Financial assets for which loss allowance is measured at the amount equivalent to lifetime expected credit loss are principally
credit-impaired financial assets.
* Credit risk rating:For financial assets for which loss allowance is measured at 12-month expected credit loss, the credit risk rating for expected credit
loss (assets to which the simplified approach is applied also correspond to this) is relatively high compared to financial assets forwhich loss allowance is measured at the amount equivalent to lifetime expected credit loss, and the credit rating of financial assets
falling in the same category is basically the same.

As of March
31, 2024(Millions of yen)
Trade and other receivables
Loss Allowance

Measured at 12-

Measured at lifetime

month expectedcredit losses

expected credit
lossesOther financial assets
Measured bysimplified approach

Measured at 12-

Measured at lifetime

month expectedcredit losses

expected credit
losses

As of April 1, 2022

-

-

567

-

4

Increase

-

-

227

-

-

Decrease (Utilization)

-

-

(127)

-

(1)

Decrease (Reversal)

-

-

(105)

-

-

Other

-

-

44

-

-

As of March 31, 2023

-

-

606

-

3

Increase

-

-

3,917

-

-

Decrease (Utilization)

-

-

(2)

-

(1)

Decrease (Reversal)--(2,143)

-

0

Other

-

-

672

-

-

As of March 31, 2024

-

-

3,050

-

2

As of March 31, 2023

-

-

4,002

-

20

Increase--

25,870--Decrease (Utilization)

-

-

(12)

-

(7)

Decrease (Reversal)--(14,155)

-

-

Other

-

-

4,437

-

-

As of March 31, 2024--

20,142-

15(Thousands of U.S. dollars)* There is no significant change in gross carrying amount that could affect a change in loss allowance.

The maximum exposure for credit risk of financial assets is the carrying amount presented in the
consolidated statement of financial position.

－

76 －

(iii) Liquidity Risks
Liquidity risks are the risks that the Group cannot execute a payment on the due date. Funds of the Group as awhole are in a position of net cash where funds held exceed borrowings. The Group formulates a financial plan
based on the annual business plan, and then manages liquidity risks by ensuring an appropriate balance
between direct and indirect financing and between short-term and long-term financing to prepare for theserisks.
The balance of financial liabilities of the Group by maturity is as follows:(Millions of yen)
As of March 31,
2023

Carrying
amountNot later
than oneyear

1-2 years

2-3 years

3-4 years

Later than 5

4-5 years

years

Contractual
cash flows
Total

Trade and otherreceivables

79,872

79,872

-

-

-

-

-

79,872

Commercial papers

19,99819,998

-

-

-

-

-

19,998Borrowings

78,39043,39814,804

2,342

3,756

6

15,00079,307

Bonds payable

59,805234

234

13,215211

15,17632,54561,615Derivative liabilities

2,698

48

-

-

-

-

2,650

2,698

Lease liabilities

18,842

3,803

2,554

2,307

2,200

1,816

7,831

20,511

259,604

147,354

17,592

17,863

6,167

16,99958,026

264,001

Total(Millions of yen)
As of March 31,
2024

Carrying
amountNot later
4-5 years---

79,714----39,988

2,702

3,924

1

-

15,00080,258234

13,215211

15,176164

32,38061,381

14,107

765

-

-

-

-

13,341

14,107

20,778

4,165

3,716

3,060

2,566

2,292

7,659

23,458

293,668

183,496

19,633

7,195

17,744

2,456

68,380298,904

than oneyear

1-2 years

2-3 years

79,71479,714--

Commercial papers

39,98839,988-Borrowings

79,24058,630Bonds payable

59,841

Derivative liabilities
Lease liabilities

Trade and otherreceivables

Total

Contractual

Later than 5years

3-4 years

cash flows
Total(Thousands of U.S. dollars)
As of March 31,
2024

Carrying
amountNot later
than oneyear

1-2 years

2-3 years

3-4 years

4-5 years

Later than
5 years

Contractual
cash flows
Total

Trade and otherreceivables

526,476

526,476

-

-

-

-

-

526,476

Commercial papers

264,103

264,103

-

-

-

-

-

264,103

Borrowings

523,347

387,230

17,84625,918

6-

99,069530,069

Bonds payable

395,228

1,546

87,277

1,392

100,234

1,086

213,859

405,394

Derivative liabilities

93,168

5,054

-

-

-

-

88,114

93,168

Lease liabilities

137,23127,507

24,54520,20916,95015,13650,582

154,929

1,939,553

1,211,917

129,668

47,519117,190

16,222451,624

1,974,139

Total

－

77 －

3) Fair Value of Financial Instruments
The Group classifies financial instruments into the following three levels in the fair value hierarchy
according to the observability of inputs used for fair value measurement in markets:
Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities
Level 2: Directly or indirectly observable inputs that are not included in Level 1
Level 3: Fair value that is determined using a valuation technique including unobservable inputs
Carrying amount and fair value of financial instruments measured at amortized cost are as follows:
As of March 31, 2023

As of March 31, 2024

As of March 31, 2024

Millions of yen

Millions of yen

Thousands of U.S. dollars

Carrying
AmountFair Value

Carrying

Carrying

Fair Value

AmountAmountFair Value

Long-term loans
payable41,61040,731

37,10436,350245,054240,077

Bonds payable

59,80560,076

59,841

59,259395,228

391,382

The above figures include balances to be collected within one year or to be repaid and redeemedwithin one year.
Financial instruments for which the carrying amount is reasonably approximate to the fair value
are not included in the table above.
The fair value of long-term borrowings is calculated by discounting the total amount of principal
and interest using the interest rate at which a similar new loan is assumed to be made.
Borrowings are classified as Level 3 in the fair value hierarchy.
The fair value of bonds payable is calculated by discounting future cash flows using the current
market interest rate.
Bonds payable are classified as Level 2 in the fair value hierarchy.
Assets and liabilities measured at fair value by the Group are as follows:(Millions of yen)
As of March 31, 2023
Level 1

Level 2

Level 3

Total

<Financial Assets>
Financial assets measured at fair value throughprofit or loss
Investments (equity financial assets)

-

-

2,956

2,956

Derivatives

-

78

-

78

8,795

-

19,881

28,676

8,795

78

22,83731,710

-

2,698

-

2,698

Financial assets measured at fair value throughother comprehensive income
Investments (equity financial assets)
Total<Financial Liabilities>
Financial liabilities measured at fair value
through profit or loss
Derivatives
Contingent consideration

-

-

6,130

6,130

Total

-

2,698

6,130

8,828

－

78 －

(Millions of yen)
As of March 31, 2024
Level 1

Level 2

Level 3

Total

<Financial Assets>
Financial assets measured at fair value throughprofit or loss
Investments (equity financial assets)

-

-

3,478

3,478

Derivatives

-

-

-

-

9,933

-

35,31445,247

9,933-

38,792

48,725Derivatives-

14,107-

14,107

Contingent consideration

-

-

6,950

6,950

Total

-

14,107

6,950

21,057

Financial assets measured at fair value throughother comprehensive income
Investments (equity financial assets)
Total<Financial Liabilities>
Financial liabilities measured at fair value
through profit or loss

(Thousands of U.S. dollars)
As of March 31, 2024
Level 1

Level 2

Level 3

Total

<Financial Assets>
Financial assets measured at fair value throughprofit or loss
Investments (equity financial assets)--

22,972

22,972Derivatives

-

-

-

-

65,606-233,232

298,838

65,606-

256,204

321,810

Derivatives-

93,168-93,168Contingent consideration--

45,90445,904-

93,16845,904139,072

Financial assets measured at fair value throughother comprehensive income
Investments (equity financial assets)
Total<Financial Liabilities>
Financial liabilities measured at fair value
through profit or loss

Total

Transfer between levels in the fair value hierarchy is recognized on the day when the event orchange in circumstances that caused the transfer occurred. In each fiscal year, there was no
significant transfer between Level 1 and Level 2 in the fair value hierarchy.

－

79 －

Changes in financial instruments classified as Level 3 are as follows:
1.Other financial assets classified as Level 3
Fiscal year ended March 31,
2023

Fiscal year ended March 31,
2024

Fiscal year ended March 31,
2024(from April 1, 2022 to March
31, 2023)(from April 1, 2023 to March
31, 2024)(from April 1, 2023 toMarch 31, 2024)

Millions of yen

Millions of yen

Thousands of U.S. dollars

Balance at the beginning

19,661

22,837150,828

Total gains and losses

1,268

14,441

95,377

133

262

1,728

Profit or loss (Note1)

1,135

14,17993,649Purchase

1,447

1,638

10,817

Selling

(70)

(64)

(420)

Other

531

(60)

(398)

22,83738,792

256,204

Other comprehensive income (Note2)

Balance at the end(Note) 1. Gains and losses included in profit or loss relate to financial assets measured at fair value through profit or loss.
These gains and losses are included in "Operating income," "Operating expenses," "Finance income" and "Finance costs."
2. Gains and losses included in other comprehensive income relate to financial assets measured at fair value through othercomprehensive income as at the reporting date. These gains and losses are included in “net change in financial assets
measured at fair value through other comprehensive income” in the consolidated statement of comprehensive income.

2.Other financial liabilities classified as Level 3
Fiscal year ended March 31, 2023
(from April 1, 2022 to March 31,
2023)

Fiscal year ended March 31, 2024
(from April 1, 2023 to March 31,
2024)

Fiscal year ended March 31, 2024
(from April 1, 2023 to March 31,
2024)

Millions of yen

Millions of yen

Thousands of U.S. dollars

Balance at the
beginning
Increase (Note1)
Other
Balance at the
end

-

6,130

40,483

6,130
-

821

5,421

-

6,950

45,904(Note) 1． Details are described in "Notes of Consolidated Financial Statements (7) Business Combinations andAcquisition of Non-controlling Interest."
Financial assets and liabilities classified as Level 2 are derivative transactions related to foreignexchange forward contracts, interest rate swaps, etc. Fair value of foreign exchange forward
contracts, interest rate swaps, etc. is calculated based on observable market data such as the interest
rate presented by financial institutions with which the Group has transactions and others.
Financial assets classified as Level 3 are mainly unlisted shares. With regard to valuation of unlisted
shares, principally, the fair value is measured taking into account future profitability or cash flowsof the investees comprehensively. The results are reviewed and approved by a person withappropriate authority. The financial liabilities classified as Level 3 are composed of contingent
considerations arising from business combinations. Contingent considerations are a payment
agreement that varies according to the level of achievement of certain indicators, such as sales after
the business combination and the number of biological samples acquired. The fair value of thecontingent consideration is estimated based on the achievement probability. For financial
instruments classified as Level 3, an increase or decrease in fair value if unobservable inputs arechanged to reasonably possible alternative assumptions is not significant.

4) Hedge Accounting
Not Applicable－80 －(35) Subsidiaries
The circumstances of the main subsidiaries of the Company is as below.
Name of the company

Percentage of
Voting Rights

Address%
Emulsion Technology, Co., Ltd.

Yokkaichi, Mie, Japan

100.0

Techno-UMG Co., Ltd.

Minato-ku, Tokyo, Japan

51.0

JAPAN COLORING CO., LTD.

Yokkaichi, Mie, Japan

100.0

JSR Micro Kyushu Co., Ltd.

Saga, Saga, Japan

100.0

MEDICAL&BIOLOGICALLABORATORIES CO., LTD.

Minato-ku, Tokyo, Japan

100.0

JSR Micro N.V.

Leuven, Belgium

100.0

JSR Micro, Inc.

Sunnyvale, CA U.S.A.

100.0(100.0)JSR Electronic Materials Korea Co., Ltd.

Gyeonggi-do, Korea

100.0

Inpria Corporation

Corvallis,
Oregon U.S.A.

100.0

JSR Micro Korea Co., Ltd.

Chungcheongbuk-do,
Korea

100.0

JSR Micro Taiwan Co., Ltd.

Yunlin County, Taiwan

100.0

KBI Biopharma, Inc.

Durham, NC, U.S.A

100.0

Selexis SA

Geneva, SWITZERLAND

100.0

JSR Micro (Changshu) Co., Ltd.

Changshu,
JiangsuProvince, China

51.0

Crown Bioscience International

Cayman Islands, U.K.

100.0
(100.0)Indivumed Services GmbH & Co. KG

Hamburg, Germany

EUV Resist Manufacturing & Qualification
Leuven, Belgium
Center N.V.

100.0
(100.0)69.4(69.4)JSR North America Holdings, Inc.

100.0

Sunnyvale, CA U.S.A.

100.0(100.0)The figure in the parentheses in the column of Percentage of Voting Rights is Indirect ownership ratio.
JSR Life Sciences, LLC

Sunnyvale, CA U.S.A.

The number of consolidated subsidiaries as of March 31, 2024 was 55 (56 as of March 31, 2023).
Changes in the consolidated subsidiaries in the current fiscal year are as follows:
The number of companies consolidated by acquisition, establishment, etc.: 0
The number of subsidiaries excluded by liquidation, sales, etc.: 1－81 －The condensed financial information for consolidated subsidiaries for which the Group has recognizedsignificant non-controlling interests are as follows. The condensed financial information shows the amount
before elimination of transactions within the Group.

Techno-UMG Co., Ltd.
(1) Proportion of non-controlling interests and the cumulative amount of non-controlling interests
As of March 31, 2023

As of March 31, 2024

As of March 31, 2024

Millions of yen

Millions of yen

Thousands of U.S. dollars

Proportion of share of
non-controlling interests
The cumulative amount of
non-controlling interests

49%

49%

49%

21,26422,194

146,582(2) Profit or loss allocated to non-controlling interests and dividends paid for non-controlling interests
Fiscal year ended
March 31, 2023
Millions of yen
Profit or loss allocated to
non-controlling interests
Dividends paid for noncontrolling interests

Fiscal year ended
March 31, 2024
Millions of yen

Fiscal year ended
March 31, 2024
Thousands of U.S. dollars

942

1,276

8,426

779

386

2,547

(3) The condensed financial information
1) Condensed Statement of Financial Position

Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total current liabilities
Total equity
Total liabilities and equity

As of March 31, 2023
Millions of yen
43,17324,00867,181
18,771
732
19,50347,67867,181

As of March 31, 2024
As of March 31, 2024
Thousands of U.S. dollars
Millions of yen
342,006
51,783
159,213
24,106501,220
75,890171,626
25,986
4,073
617
175,699
26,603
325,52149,287501,220
75,8902) Condensed Statements of Profit or Loss and Comprehensive Income

Revenue
ProfitComprehensive income

Fiscal year ended
March 31, 2023
Millions of yen
82,865
1,972
1,845
－

82 －

Fiscal year ended
Fiscal year ended
March 31, 2024
March 31, 2024
Millions of yen
Thousands of U.S. dollars
536,245
81,193
16,9762,570
15,825
2,396

3) Condensed Statement of Cash Flows
Fiscal year ended
March 31, 2023

Fiscal year ended
March 31, 2024

Fiscal year ended
March 31, 2024

Millions of yen

Millions of yen

Thousands of U.S.
dollars

Cash flows from operating
activities
Cash flows from investing
activities
Cash flows from financing
activities
Net increase (decrease) in cash
and cash equivalents
Cash and cash equivalents at theend of the period

2,573

10,56569,778(2,237)(2,451)(16,189)(1,590)(787)(5,198)(1,255)

7,327

48,391

1,591

8,917

58,896(36) Related Parties
Key Management Personnel Compensation
Fiscal year ended
March 31, 2023 (April
1, 2022 to March 31,
2023)

Fiscal year ended
March 31, 2024 (April
1, 2023 to March 31,
2024)

Fiscal year ended
March 31, 2024 (April
1, 2023 to March 31,
2024)

Millions of yen

Millions of yen

Basic compensation

405

684

Thousands of U.S. dollars
4,514

Bonuses
Share-based remuneration

148
504

443
437

2,923
2,885

1,056

1,563

10,323

Total

－

83 －

(37) Commitments
Commitments related to expenditures taking place after the last day of the fiscal year are as follows:

Acquisition of property, plant andequipment

As of March 31,2023

As of March 31,2024

As of March 31,
2024

Millions of yen

Millions of yen

Thousands of U.S.
dollars

7,108

13,65690,189(38) Contingent liabilities
There is a need for re-inspection of quality required for certain products that a subsidiary of the Group
manufactured on contract for a specific customer. And the subsidiary, the specific customer and the external
third party are working together and investigating for pursuing the causes and future actions. The results of theinvestigation may reveal problems with issues related to safety, and so on not expected from the information
available at this time.
At this time, there is no high probability of an outflow of economic benefits of the Group related to this issue,
and we cannot predict the impact of this issue on the Group’s financial position, operating results, or cash flow.
In addition, as it is impossible to predict the outcome of this investigation at this time, we do not disclosedetailed information regarding these matters.
(39) Material subsequent events(Tender Offer and Share Consolidation)
At a meeting of the Board of Directors held on June 26, 2023, the Company resolved to express its opinion infavor of the tender offer in connection with the tender offer by JICC-02, Ltd. for the Company's commonshares, the Share Acquisition Rights, and the American Depository Receipts, and to recommend theshareholders and holders of the Share Acquisition Rights of the Company to tender their shares in the tender
offer, and to recommend the holders of the American Depository Receipts to tender their shares in the tender
offer after delivering the American Depository Receipts to the depositary bank in advance and receiving thedelivery of the Company's shares represented by the American Depository Receipts.
As a result of the tender offer conducted by JICC-02, Ltd. for the Company's common shares, the Share
Acquisition Rights, and the American Depository Receipts from March 19, 2024 to April 16 of the same year,
the Company became the largest shareholder, which is the parent company and major shareholder, as of thecommencement date of settlement of the tender offer on April 23, 2024.
Based on the results of the tender offer, the proposal for the share consolidation was approved and approved at
the Extraordinary General Meeting of Shareholders held on June 5, 2024. The Company's shares fell under thedelisting criteria of the Tokyo Stock Exchange, and the Company's shares were delisted on June 25, 2024 after
being designated as shares under liquidation from June 5, 2024 to June 24 of the same year.

(1) Overview of the Tender Offeror, JICC-02, Ltd. (as of April 17, 2024)(1)Name
JICC-02, Ltd.
(2)Location
1-3-1 Toranomon, Minato-ku, Tokyo(3)Representative Director
Osamu Itabashi(1) Business to control and manage the business activities of acompany by owning its shares or equity interests .
(4)Business(2)Other businesses incidental to or related to the businesses listed in
the preceding item.
(5)Capital
100,000 yen(6)Date of Establishment
June 15, 2023－

84 －(7)Major shareholders andshareholding ratio

JIC PE Joint Investment Fund No. 1 Investment Business Limited
Partnership 97%
JIC PE Fund No. 1 Investment Business Limited Partnership 3%(8)Relationship between the
Company and the Tender Offeror
Capital relationship
Not applicable.
Personnel relationship
Not applicable.
Business relationship
Not applicable.
Status of related party
Not applicable.
(2) Outline of the Tender Offer① Period of Tender Offer
From March 19, 2024 to April 16, 2024 (20 business days)② Price of Tender Offer(i) ¥4,350 per share of common stock(ii)Share Options¥434,900 per share of First Series Share Options¥434,900 per share of 2006 Share Options (for Directors)¥434,900 per share of 2006 Share Options (for Executive Officers)¥434,900 per share of 2007 Share Options¥434,900 per share of 2008 Share Options¥434,900 per share of 2009 Share Options¥434,900 per share of 2010 Share Options¥434,900 per share of 2011 Share Options¥434,900 per share of 2012 Share Options¥434,900 per share of 2013 Share Options¥434,900 per share of 2014 Share Options(iii) Depository Receipts for Share Certificates, etc.
Number of Target Company Shares for the American Depository Shares ¥4,350 per share(Note)Since the tender offer will not accept the tender offer for the American Depository Shares, but will
accept the tender offer for the Target Company Shares for the American Depository Shares represented by theAmerican Depository Shares, the purchase price per share of the Target Company Shares to be delivered upondelivery of the American Depository Shares to the Depository Bank is stated.
(3) Overview of Share Consolidation① Type of Shares to be Consolidated
Common Shares② Consolidation Ratio
In accordance with the resolution of the Extraordinary General Meeting of Shareholders held on June 5, 2024,
the Company consolidated its shares at a ratio of 1 share for every 88 million shares of the Company on June27, 2024.
③ Total number of issued shares to be decreased
207,635,588 shares④ Total number of issued shares before the effective date
207,635,590 shares(Note)In accordance with the resolution of the Board of Directors held on May 8, 2024, treasury shares werecancelled on June 26, 2024, and the total number of issued shares decreased by 764,410 shares.

－

85 －

⑤ Total number of issued shares after the effective date2 shares⑥ Total number of authorized shares on the effective date
8 shares⑦ Method of treatment of fractions of less than one share and the amount of money expected to be delivered
to shareholders as a result of such treatment
Regarding fractional shares arising from the Share Consolidation, in accordance with the procedures prescribedby Article 235 of the Companies Act (Act No. 86 of 2005, including subsequent revisions; hereinafter referred
to as the "Companies Act".) and other relevant laws and regulations, the Company will sell shares equivalent to
the total number of such fractions (If the total number includes a fraction of less than one share, the fraction
will be rounded down.) and deliver the proceeds from the sale to shareholders in proportion to their fractions.
With respect to this sale, the Company plans to have JICC-02, Ltd. purchase the shares with the permission of
the court in accordance with the provisions of Article 234, Paragraph 2 of the Companies Act, as appliedmutatis mutandis pursuant to Article 235, Paragraph 2 of the same Act, in consideration of the fact that the
Share Consolidation is conducted as part of the transaction for the purpose of making the Company's shares
private with JICC-02, Ltd. being the only shareholder of the Company, and that the Company's shares will bedelisted as of June 25, 2024 and will have no market price. In this case, the sale price is planned to be set atsuch a price that, if the necessary court permission is obtained as scheduled, money equivalent to the amountobtained by multiplying the number of shares of the Company held by the shareholders stated or recorded in
the final shareholder register of the Company as of June 26, 2024, which is the day before the effective date of
the Share Consolidation, by 4,350 yen, which is the same amount as the tender offer price, will be delivered.
However, the actual amount to be delivered may differ from the above amount in cases where the court
permission is not obtained or where fractional adjustments are necessary for calculation.
In accordance with the provisions of Article 234, Paragraph 2 of the Companies Act, as applied mutatis mutandis
pursuant to Article 235, Paragraph 2 of the Companies Act, the Company plans to file a petition with the courtin late July 2024 for permission to sell the fractional shares to the tender offeror. The time when such permission
can be obtained may vary depending on the circumstances of the court, etc., but with the permission of the court,
the Company expects to sell the relevant shares to JICC-02, Ltd., from early to late August 2024, and to deliver
the proceeds of the sale to the shareholders around mid-September to late October 2024 after making thenecessary preparations to deliver the proceeds of the sale to the shareholders. Taking into consideration the
period required for the series of procedures related to the sale from the effective date of the Share Consolidation,
the Company has determined that the fractional shares will be sold and the proceeds of the sale will be delivered
to the shareholders at each of the aforementioned times.
(Stock Purchase Agreement as to acquisition of stock of Yamanaka Hutech Corporation)
The Company reached an agreement with Yamanaka Hutech Corporation (hereinafter ”YHC”) to acquire all of
its shares and make it a wholly owned subsidiary. The share purchase agreement was signed on May 15, 2024.
YHC manufactures and sells high-purity chemicals for semiconductor manufacturing.
The transaction is expected to close in August 2024, after the completion of several processes, including
regulatory approvals.
YHC has maintained its advanced molecular design, synthesis technology, and quality control system since its
establishment in 1960, and has a track record of more than 60 years of supplying high-quality CVD/ALD
precursors to leading-edge semiconductor device manufacturers. In particular, YHC is highly competitive insome ALD material areas.
Through this share acquisition, YHC's CVD/ALD precursors for semiconductors will be added to the Company’s
product portfolio, which has been centered on photoresists, and the Company will strengthen its capability togenerate greater customer value as a global supplier of semiconductor materials.
The impact on the Group by this stock acquisition is currently under investigation.

－

86 －

Independent auditor’s report
To the Board of Directors of JSR Corporation:

Report on the Audit of the Consolidated Financial Statements
OpinionWe have audited the accompanying consolidated financial statements of JSR Corporation (“theCompany”) and its consolidated subsidiaries (collectively referred to as “the Group”), which comprisethe consolidated statement of financial position as at March 31, 2024, and the consolidated statements
of profit or loss, comprehensive income, changes in equity and cash flows for the year then ended, andnotes, comprising material accounting policies and other explanatory information.
In our opinion, the accompanying consolidated financial statements present fairly, in all material
respects, the consolidated financial position of the Group as at March 31, 2024, and its consolidated
financial performance and its consolidated cash flows for the year then ended in accordance with IFRS
Accounting Standards as issued by the International Accounting Standards Board (IFRS AccountingStandards).
Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the
Audit of the Consolidated Financial Statements section of our report. We are independent of the Groupin accordance with the ethical requirements that are relevant to our audit of the consolidated financial
statements in Japan, and we have fulfilled our other ethical responsibilities in accordance with theserequirements. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the consolidated financial statements of the current period. These matters were addressed in thecontext of our audit of the consolidated financial statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on these matters.
Appropriateness of management’s judgment on the change in the CGU for lithography materials,
etc. and as to whether an impairment loss should be recognized on goodwill allocated to the CGU
The key audit matter

How the matter was addressed in our audit

As described in Note 17, “Impairment on
Non-Financial Assets” of the consolidated
financial statement, the Group recognized
goodwill of \68,222 million allocated to
CGU for lithography materials, etc., which
represented 9% of total assets in the
consolidated financial statements. The
goodwill arose mainly when the Company
acquired control of Inpria Corporation.
As also described in Note 17, “Impairmentof Non-Financial Assets" of the consolidated
financial statements, the Company reviewed
the commercial flow and started to offer
metal oxide resists (hereinafter "MOR") as a
product lineup of lithography materials in
addition to the conventional chemically
amplified resists. As a result, lithographymaterials and MOR, which had been
identified as independent CGUs, werecombined into a single CGU, “lithographymaterials, etc.,” in the current fiscal year, andgoodwill which had been allocated to therespective CGUs was reallocated to the new
CGU. Continuous identification of a CGU
over each period is required for the sameasset or asset type, unless a change isjustified. The identification of a new CGU
based on an event or situation that justifies achange in the CGU requires a high degree of
judgment by management.
The Company tests goodwill for impairment
at least annually or more frequently
whenever it is determined that there is an
impairment indicator. In the impairment
testing, when the recoverable amount of agroup of cash-generating units is less thanthe carrying amount, the carrying amount isreduced to the recoverable amount, and theresulting decrease in the carrying amount isrecognized as an impairment loss.
In the annual impairment testing, no
impairment loss was recognized in thecurrent fiscal year as the value in use of the
CGU for lithography materials, etc. exceeded
the carrying amount including goodwill.

The primary procedures we performed to assess
whether management’s judgment with respect to thechange in the CGU for lithography materials, etc. andthe recognition of an impairment loss on goodwill
allocated to the CGU was appropriate included thefollowing:(1) Internal control testing
We tested the design and operating effectiveness ofcertain of the Company’s internal controls for its
assessment of goodwill including the judgment on theidentification of the CGU.
(2) Assessment of the reasonableness of the change
in the CGU
The change in the CGU by the Company was based on
significant changes in cash inflows and other factors.
We assessed whether the identification of a new CGU
was appropriate, mainly through:•Inspecting relevant materials, inquiring ofmanagement and personnel responsible for thebusiness, and inspecting materials from theManagement Committee regarding theinterrelationship between lithography materials
and MOR;•

Inspecting relevant materials such as the sales
agent agreement with the main sales agent andinquiring of management regarding the review ofcommercial distribution to obtain anunderstanding on its content and objective; and•Assessing the appropriateness of the change byinspecting relevant materials such as those of theManagement Committee regarding the supervisory
categories of management and the decisionmaking units for investment.

(3) Assessment of the reasonableness of theestimated value in use
We inquired of management and the personnel
responsible for the CGU about the basis on which key
assumptions were developed to assess theappropriateness of those assumptions used in preparing
the business plan, which formed the basis for
estimating future cash flows. In addition, we:•Assessed the consistency of the business plan used
for estimating the future cash flows with thebusiness plan approved by management;

The value in use is used as the recoverable
amount in the impairment testing of the CGU
for lithography materials, etc., in the current
fiscal year. Future cash flows used tomeasure the value of use are estimated on thebasis of the business plan for lithographymaterials, etc. However, the revenue
projection which formed the basis for thebusiness plan involved a high degree of
uncertainty as revenue is affected by thegrowth potential of the photoresist market,
etc. Accordingly, management’s judgment
thereon had a significant effect on theestimated future cash flows.

•

Compared the business plan formulated in theprevious year with the actual results toretrospectively examine the accuracy of thebusiness plan;•

Compared sales growth rates used in the businessplan with available external data on market growth
rates; and•Involved a valuation specialist within ourdomestic network firms to assess theappropriateness of the model used by management
to estimate the discount rate and compared it withthe discount rate independently calculated by thevaluation specialist.

In addition, selecting appropriate models andinput data for estimating the discount raterequires a high degree of expertise invaluation.
We, therefore, determined that ourassessment of the appropriateness ofmanagement’s judgment on the change in the
CGU for lithography materials, etc. and as towhether an impairment loss should berecognized on goodwill allocated to the CGU
was one of the most significant matters in our
audit of the consolidated financial statements
for the current fiscal year, and accordingly, a
key audit matter.
Appropriateness of management’s judgment as to whether an impairment loss should berecognized on goodwill allocated to the drug discovery and development services business
The key audit matter
As described in Note 17, “Impairment on
Non-Financial Assets” of the consolidated
financial statement, the Group recognized
goodwill of \59,019 million allocated to thedrug discovery and development services
business, which represented 8% of total
assets in the consolidated financial
statements. The goodwill arose primarily
when the Company acquired control ofCrown Bioscience International.
Goodwill is required to be tested for
impairment at least annually or more
frequently whenever it is determined that
there is an impairment indicator. In the
impairment testing, when the recoverable

How the matter was addressed in our audit
The primary procedures we performed to assess
whether management’s judgment with respect to therecognition of an impairment loss on goodwill
allocated to the drug discovery and development
services business was appropriate included thefollowing:(1) Internal control testing
We tested the design and operating effectiveness ofcertain of the Company’s internal controls relevant tomeasuring the value in use used in the impairment
testing on goodwill. In this assessment, we focused ouramount of a group of cash-generating units isless than the carrying amount, the carrying
amount is reduced to the recoverable amount,and the resulting decrease in the carrying
amount is recognized as an impairment loss.
The recoverable amount is the higher of
either the value in use or fair value less costsof disposal.
In the annual impairment testing, no
impairment loss was recognized in thecurrent fiscal year as the value in use of the
drug discovery and development services
business exceeded the carrying amount.
The value in use was discounted to thepresent value of an estimated amount of
future cash flows based on the five-yearbusiness plan approved by management. The
five-year revenue projection based on thebusiness plan involved a high degree of
uncertainty as the revenue is affected by the
future growth potential of the CRO business
in which the drug discovery and development
services business operates and the capacity ofthe equipment used in the business.
Accordingly, management’s judgment
thereon had a significant effect on theestimated future cash flows.
In addition, selecting appropriate models andinput data for estimating the discount raterequires a high degree of expertise invaluation.

testing on controls to prevent and/or detect the use of
inappropriate assumptions to estimate the value in use.
(2) Assessment of the reasonableness of theestimated value in use
We inquired of management and the personnel
responsible for the drug discovery and development
services business about the basis on which key
assumptions were developed to assess theappropriateness of those assumptions used in preparing
the business plan, which formed the basis for
estimating future cash flows. We also assessed whether
assumptions used in preparing the business plan wereappropriately selected, by estimating the impact on
future cash flows for the subsequent fiscal years whenthe effects on specific uncertainties were incorporated
into each assumption. In addition, we:•Compared the five-year revenue included in thebusiness plan with available external data related
to the market growth rate;•

Examined the consistency of the capacity of theequipment which is currently held with the
projected revenue; and•Involved a valuation specialist within ourdomestic network firms to assess theappropriateness of the model used by management
to estimate the discount rate and compared it withthe discount rate independently calculated by thevaluation specialist.

We, therefore, determined that ourassessment of the appropriateness ofmanagement’s judgment as to whether an
impairment loss should be recognized on
goodwill allocated to the drug discovery anddevelopment services business was one of
the most significant matters in our audit of
the consolidated financial statements for thecurrent fiscal year, and accordingly, a key
audit matter.
Other Information
The other information comprises the information included in the disclosure documents that contain or
accompany the audited consolidated financial statements, but does not include the consolidated
financial statements and our auditor’s report thereon.
We do not perform any work on the other information as we determine such information does not exist.

Responsibilities of Management and Corporate Auditors and the Board of Corporate Auditors
for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated financial
statements in accordance with IFRS Accounting Standards, and for such internal control as
management determines is necessary to enable the preparation of consolidated financial statements thatare free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the Group’s
ability to continue as a going concern, disclosing, as applicable, matters related to going concern inaccordance with IFRS Accounting Standards and using the going concern basis of accounting unlessmanagement either intends to liquidate the Group or to cease operations, or has no realistic alternative
but to do so.
Corporate auditors and the board of corporate auditors are responsible for overseeing the directors’
performance of their duties with regard to the design, implementation and maintenance of the Group’s
financial reporting process.
Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements
as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’sreport that includes our opinion. Reasonable assurance is a high level of assurance, but is not aguarantee that an audit conducted in accordance with auditing standards generally accepted in Japan
will always detect a material misstatement when it exists. Misstatements can arise from fraud or error
and are considered material if, individually or in the aggregate, they could reasonably be expected toinfluence the economic decisions of users taken on the basis of these consolidated financial statements.
As part of our audit in accordance with auditing standards generally accepted in Japan, we exercise
professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the consolidated financial statements,
whether due to fraud or error, design and perform audit procedures responsive to those risks, andobtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The riskof not detecting a material misstatement resulting from fraud is higher than for one resulting fromerror, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or theoverride of internal control.

Obtain an understanding of internal control relevant to the audit in order to design audit proceduresthat are appropriate in the circumstances, while the objective of the audit is not to express an
opinion on the effectiveness of the Group’s internal control.

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.

Conclude on the appropriateness of management’s use of the going concern basis of accounting
and based on the audit evidence obtained, whether a material uncertainty exists related to events orconditions that may cast significant doubt on the Group’s ability to continue as a going concern. If
we conclude that a material uncertainty exists, we are required to draw attention in our auditor’sreport to the related disclosures in the consolidated financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to
the date of our auditor’s report. However, future events or conditions may cause the Group tocease to continue as a going concern.



Evaluate whether the presentation and disclosures in the consolidated financial statements are inaccordance with IFRS Accounting Standards, the overall presentation, structure and content of theconsolidated financial statements, including the disclosures, and whether the consolidated financial
statements represent the underlying transactions and events in a manner that achieves fairpresentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities orbusiness activities within the Group to express an opinion on the consolidated financial statements.
We are responsible for the direction, supervision and performance of the group audit. We remainsolely responsible for our audit opinion.

We communicate with corporate auditors and the board of corporate auditors regarding, among othermatters, the planned scope and timing of the audit, significant audit findings, including any significant
deficiencies in internal control that we identify during our audit.
We also provide corporate auditors and the board of corporate auditors with a statement that we havecomplied with relevant ethical requirements regarding independence, and communicate with them all
relationships and other matters that may reasonably be thought to bear on our independence, and whereapplicable, actions taken to eliminate threats or safeguards applied.
From the matters communicated with corporate auditors and the board of corporate auditors, we
determine those matters that were of most significance in the audit of the consolidated financial
statements of the current period and are therefore the key audit matters. We describe these matters in
our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in
extremely rare circumstances, we determine that a matter should not be communicated in our reportbecause the adverse consequences of doing so would reasonably be expected to outweigh the public
interest benefits of such communication.
Fee-related Information
Fees paid or payable to our firm and to other firms within the same network as our firm for audit andnon-audit services provided to the Company and its subsidiaries for the current year are 328 million yen
and 18 million yen, respectively.
Convenience Translation
The U.S. dollar amounts in the accompanying consolidated financial statements with respect to the year
ended March 31, 2024 are presented solely for convenience. Our audit also included the translation of
yen amounts into U.S. dollar amounts and, in our opinion, such translation has been made on the basis
described in Note 2 to the consolidated financial statements.
Interest required to be disclosed by the Certified Public Accountants Act of Japan
We do not have any interest in the Group which is required to be disclosed pursuant to the provisions of
the Certified Public Accountants Act of Japan.

Toshiyuki Tamura
Designated Engagement Partner
Certified Public Accountant

Tatsuo Utsugi

Designated Engagement Partner
Certified Public Accountant
KPMG AZSA LLC
Tokyo Office, Japan
July 19, 2024
Notes to the Reader of Independent Auditor’s Report:
This is a copy of the Independent Auditor’s Report and the original copies are kept separately by theCompany and KPMG AZSA LLC.