ANNUAL REPORT 2010
For the year ended March 31, 2010

Profile
JSR Corporation (formerly ‘Japan Synthetic Rubber Co., Ltd.’) was established in 1957 with the aim to commence thedomestic production of synthetic rubber. Since then, JSR has continued to expand its business to manufacture emulsions
and plastics. JSR further expanded in its operations by utilizing the group’s own polymer technologies to introduce products such as semiconductor materials, display materials and optical materials. As such, the developments of these materials
in the fields of information and electronics have been a focal point, leading to innovative changes to the company’s business structure.
Currently, JSR Corporation’s four-year Midterm Business Plan “JUMP2010” (which began in fiscal 2008) is being implemented. “JUMP2010” are ideal goals set for JSR to achieve by 2010; taking a big “jump” towards expediting the changes
made to business and the structure, and aiming to take further leaps. In addition to further enhancing global competitiveness with existing projects, JSR will continue to provide our “innovative materials” and “high-precision processing technology
and products” to newly-emerging fields in environment, energy, biotechnology and medical materials, as well as in theareas of information and electronics, which are expected to continue to grow in the future.

Corporate Philosophy“To provide new materials, and through their value strive to contribute to the realization of an affluent human society (people, society, and the environment).”

Corporate Slogan

In December 2007, to celebrate fifty years since the company’s founding, JSR established a new corporate slogan:“With chemistry, we can.” The slogan exhibits JSR’s technological strengths to make possible by chemistry what appears
to be impossible, and shows pursuit of cutting-edge technologies to create new values. It also displays JSR’s stance toprovide solutions to customers and to society, continually meeting challenges for the future.
The corporate slogan shows the scope of our business domains in a clearer way and supplements our corporate philosophy “Materials Innovation”. Under the new corporate slogan, we endeavor to enhance our corporate brand.

Contents
2

Consolidated Financial Highlights

18

Research and Development,
Intellectual Property

4

To Our Shareholders
21

The JSR Corporate Social
Responsibility Report

22

Corporate Governance andCompliance25

Directors, Corporate Auditors, andExecutive Officers

26

Company Network

27

Financial Section

28

Management’s Discussion andAnalysis32

Consolidated Balance Sheets

34

Consolidated Statements of Income

35

Consolidated Statements of
Changes in Net Assets

36

Consolidated Statements of Cash
Flows

37

Notes to Consolidated Financial
Statements

16 Emulsions

50

Independent Auditors’ Report

17 Plastics

51

Corporate Data

51

Investor Information

Fiscal 2010 resulted in both a fall in revenue anddecline in profit. In fiscal 2011, JSR forecasts
improved performance with increased consolidated
net sales, and aim for a recovery to a double-digit
operating margin. In addition, we will create our next
mid-term business plan based on a long-term viewof analyzing the business and social environments
up to 2030.

8Special Feature
JSR’s Environmentally-friendly Products— Materials Innovation —As a chemical company that must respond toenvironmental issues, the JSR Group has devoted
its energy to developing and manufacturing productsthat contribute to reducing environmental load. The
JSR Group is conducting business activities basedon its corporate philosophy — Materials Innovation.
We believe that broadly providing value to society
through developing innovative and competitive
materials underlies the entire Group’s shared identity
in promoting and expanding our business.

10
12

At a Glance
Review of Operations
12 Fine Chemicals and Other Products
14 Petrochemicals
14 Elastomers

Forward-Looking Statements
Statements regarding the company’s future plans, strategies, projected performance and outlook are based on information available at thetime of writing. Readers are cautioned that economic trends in JSR’s target markets and other risks and factors beyond the company’scontrol could cause actual results to differ materially from those projected by management.

ANNUAL REPORT 20101

Consolidated Financial Highlights
Fiscal Year ended March 31
For the purpose of this Annual Report, JSR’s accounting period (fiscal year) is defined as the period from April 1 to March 31 of the following year.
When noted “fiscal 2010,” this indicates the period from April 1, 2009 to March 31, 2010.

Net Sales /Net Income(Billions of Yen)

500

50

400

40

300

30

200

20

100

10

0

FY2001Results for the year
Net sales
Costs and expenses
Operating income
Interest and dividend income

FY2002

FY2003

FY2004¥ 231,823 ¥ 220,058 ¥ 247,139 ¥ 275,071
222,400
211,246
226,345
242,452
9,423
591
(946)

8,812
411
(757)

20,794431(750)

32,619
397
(693)

9,332
5,678

7,915
4,728

17,855
10,99130,37819,353

10,936
17,59913,265
16,507

16,04816,48917,156
14,970283,859

270,054281,874

308,581

24,222
155,476
124,684

22,934135,477
131,752

24,208
139,682
139,447

146,280
159,497

1.4
2.0
4.6
43.9

1.5
1.8
3.6
48.8

1.6
3.9
7.9
49.5

1.6
6.3
12.9
51.7

Per share of common stock (Yen and U.S. Dollars)
22.20
Net income
6.00
Cash dividends

18.48
6.00

42.46
7.00

75.12
9.00

Equity514.93544.94623.14

Interest expenses
Income before income taxes
and minority interests
Net income
Capital expenditures
Depreciation

0

FY’06 FY’07 FY’08 FY’09 FY’10
Net Sales [Left]
Net Income [Right]

Operating Income /Operating Margin(Billions of Yen)

(%)

80

16

60

12

40

8

20

4

0

0

Year-end financial position
Total assets
Long-term debt due after one year
Total liabilities
EquityCurrent ratio (times)
Return on assets (%)
Return on equity (%)
Equity ratio (%)

FY’06 FY’07 FY’08 FY’09 FY’10
Operating Income [Left]
Operating Margin [Right]

487.42

Note: U.S. dollar amounts are translated from yen, for convenience only, at a
rate of $1=¥93.04; the exchange rate prevailing at March 31, 2010.

13,920FY2003–FY2004

Cash Flows(Billions of Yen)

60

HOP
30

JSRevolution
The period for establishing asolid foundation in order topromote structural reform andachieve growth.

0

-30

-60

FY’06 FY’07 FY’08 FY’09 FY’10
Net Cash Provided by Operating Activities
Net Cash Used in Investing Activities
Free Cash Flow2

JSR Corporation

Net Sales:¥275.1 billion
Operating Income:¥32.6 billion

FY2005

FY2006

FY2007

FY2008FY2009

Shareholders’ Equity /ROEMillions of Yen

Thousands of
U.S. Dollars

FY2010FY2010300

18$ 3,333,874
3,116,438
217,436
6,104

200

12

100

6

¥ 305,368 ¥ 338,160 ¥ 365,831 ¥ 406,968 ¥ 352,503 ¥ 310,184
260,035
284,803
310,588346,958
322,155
289,954
45,33353,35755,24360,01030,34820,230
519
635
1,030
1,309
1,230
568
(475)

(420)

(399)

(256)

(271)

(172)

(1,852)

43,471
27,56449,03830,55553,44033,65554,86736,99420,803
13,981

19,45813,645

209,135

18,134
15,24523,361
16,20622,094
18,13329,07621,18019,081
24,833

17,70722,380146,656
190,317240,537(Bi lions of Yen)

(%)

0

0

FY’06 FY’07 FY’08 FY’09 FY’10
Shareholders’ Equity [Left]
ROE [Right]

325,031
13,857139,249
182,476
1.8

381,097
1,607
164,389
212,7511.7

408,949
2,745
168,963
235,186
1.8

416,951
1,525
159,288
252,5391.9

339,498
1,500
97,512
240,896
2.5

373,566
1,500
122,865
249,440
2.3

8.7
16.1
56.1

8.7
15.5
55.8

8.2
15.0
57.5

8.9
15.2
60.6

4.1
5.7
71.0

3.7
5.6
66.8

107.54119.63133.10147.26

56.36

55.87

14.00
717.13

20.00
836.31

24.00
932.4732.00
1,009.27

32.00
986.3326.00
1,021.31

4,015,108
16,122
1,320,559
2,680,999

0.60
0.28
10.98

Total Assets /ROA(Bi lions of Yen)

(%)

500

10

400

8

300

6

200

4

100

2

0

0

FY’06 FY’07 FY’08 FY’09 FY’10
Total Assets [Left]

FY2005–FY2007

ROA [Right]

FY2008–FY2011

R&D Expenses /Capital Expenditures(Bi lions of Yen)

30

STEP

JUMP

JSRevolution II

JUMP2010

The period for creating operationalfoundations for next-stage growthbusinesses and increasing profits forexisting businesses.

The period for accelerating reform andinnovation to achieve a jump forward
while continuing growth.

Net Sales:¥365.8 billion
Operating Income:¥55.2 billion

Net Sales:¥347 billion (Revised in April 2010)
Operating Income:¥38.0 billion (Revised in April 2010)

20

10

0

FY’06 FY’07 FY’08 FY’09 FY’10
R&D Expenses
Capital Expenditures

ANNUAL REPORT 20103

To Our Shareholders

We are deeply grateful for the supportof all our shareholders. On behalf of the
JSR Group, I will report on our fiscal
2010* results and upcoming
management strategies.
*fiscal year ended March 31, 2010

MITSUNOBU KOSHIBA
Representative Director and President

1. Fiscal 2010 Results

mobiles, automotive tires and semiconductors recovered to

In fiscal 2010, although the economy showed signs of recov-

year-on-year growth in the second half of the year, whole year

ery from the 2008-2009 global financial crisis, compared to

production remained below the previous year’s level.

levels prior to the downturn, the economy still remained in an
unfavorable situation.

4

Looking at raw materials, there was a large drop in thenaphtha price at the end of the previous fiscal year, but theIn our demand industries, domestic and foreign economic

price rebounded at the beginning of fiscal 2010. In addition,

stimulus packages led to demand in liquid crystal display (LCD)

cost of utilities and prices of major petrochemical raw

TVs to exceed the previous fiscal year, and production of flatmaterials such as styrene and acrylonitrile monomers rose,

panel displays was robust. However, while production of auto-

resulting in negative pressure on earnings.

JSR Corporation

Net Sales & Operating Income

Net sales
Operating income
Operating margin
ROE(Billions of yen)

¥ 310.2
20.2

FY2010Initial plan
¥ 290.0
15.0

FY2011plan¥ 347.0
38.0

6.5%
5.6%

5.2%
4.0%

11.0%
9.7%

FY2006

FY2007

FY2008FY2009FY2010¥ 338.1
53.3¥ 365.8
55.2¥ 407.0
60.0¥ 352.5
30.3

15.8%
15.5%

15.1%
15.0%

14.7%
15.2%

8.6%
5.7%

Petrochemicals(Billions of yen)

Under these challenging circumstances, JSR put effort into
its core businesses, which consist of the petrochemicals andfine chemicals businesses, by streamlining business cost structure to accommodate an appropriate sales size to maintain a

Net sales
Operating income

FY2009FY2010¥ 206.1¥ 196.6

FY2011plan¥ 192.0

9.9

-0.2

11.5

reasonable level of profit, in addition to improving global competitiveness by strengthening JSR’s presence in growing

Fine Chemicals and Other Products(Billions of yen)markets by technological advantage.
In terms of streamlining business cost structure, JSR continued to execute the Cost-Reduction Plan “E-100 Projects”
across all group companies, and made additional efforts to

Net sales
Operating income

FY2009FY2010¥ 146.4¥ 140.5

20.5

20.5

FY2011plan¥ 155.0
26.5

reduce fixed costs, exceeding the initial plan and securing
earnings.
In order to improve global competitiveness for the petro-

regard to the buyback of our own shares, this will be conductedchemicals business, the company expanded export sales

as part of flexible capital and shareholder return policies, based

focusing on emerging countries, especially China with tech-on the status of our shares. Our dividends were ¥32 in fiscal

nologically differentiated products. In addition, prices of some2009 and ¥26 in fiscal 2010. We plan to deliver ¥32 of divi-

products were revised in response to rising prices of major

dends in fiscal 2011, a ¥6 increase from the previous year.

raw materials. In the fine chemicals business, further growthof sales in our leading-edge materials, as well as incorporat-

3. Fiscal 2011 Outlook and Strategies

ing demand in newly-emerging nations were targeted.

Based on our results for the latter half of fiscal 2010 and the

However, amidst the global economy still unrecovered to its

current market conditions, we forecast improved performanceprevious level, decreased demand impacted on our results.

in fiscal 2011 with consolidated net sales increasing 11.9%

As a result, sales and profit were down in fiscal 2010, con-year-on-year to ¥347 billion, operating income increasing 87.8%

solidated net sales decreased 12% year-on-year to ¥310.2

to ¥38 billion, current income increasing 76.5% to ¥39.5 bil-billion, operating income was down 33.3% to ¥20.2 billion, cur-lion, and net income to improve by 83.2% to ¥25 billion. The

rent income decreased 28.1% to ¥22.4 billion, and current net

above projections assume a yen exchange rate of ¥90 to the US

income decreased 2.4% to ¥13.6 billion.

dollar, and a naphtha price of ¥50,000 per kiloliter.

2. Dividends

drove Japan’s economic recovery thus far will gradually be

JSR views profit returns to shareholders as one of its impor-diminished, with concerns that this will affect personal con-tant management tasks, along with enhancing corporate value.

sumption. However, we expect the economy to continue its

The company’s policy is centered on delivering stable divi-

recovery supported by exports to recovering overseas

dends, balanced with consideration of the funds necessary foreconomies and an end to declines in capital investment, withbusiness development and continued growth. In addition, withthe employment and income environment steadily heading

In fiscal 2011, effects of economic stimulus packages which

ANNUAL REPORT 20105

Cost-Reduction Plan

Consolidated Net Sales & Operating Income

E-100 Projects(Billions of Yen)

(Billions of Yen)

28.0
or more

30

21.2

20

13.7

10

• FY2011 target of ¥21 billion
reset in previous fiscal year was
already achieved by FY2010
with ¥21.2 billion.
• Aim to achieve reduction of¥28.0 billion (cumulative total)
in FY2011.

500

100

400

80

300

60

200

40

100

20

7.9
E-100
(Petrochemicals)
E-100(Fine Chemicals and Other Products)

0
FY’08

FY’09

FY’10

0

FY’11
(Plan)

Emergency actions for fixed costs• FY2010 target was to cut costs by ¥8 billion. Achieved ¥10 billion reduction.

FY’03 FY’04 FY’05 FY’06 FY’07 FY’08 FY’09 FY’10 FY’11(Plan)

JSRevolution JSRevolution II

0

JUMP2010

Net Sales [Left]
Operating Income [Right]

towards recovery. In Japan, the automobile, automotive tires

es consequent upon recovery in demand, as well as imple-

and other main demand industries for our petrochemicals busi-

ment structural changes that includes the optimization ofness will remain below previous levels; however, global demand

production bases and restructuring of production lines. In

for synthetic rubbers for use in fuel-efficient tires is gaining

order to focus on emerging markets which are showing rapid

strength with raising awareness of environmental issues. For

growth, especially the Chinese market, a locally attached

the semiconductor and flat panel display industries which aremarketing organization was established, based in our Chinese

the main demand industries of our fine chemicals and othersubsidiary — JSR (Shanghai) Co., Ltd., in March 2010. In addi-

products business, relatively fast growth is expected due totion, we will reinforce our resource allocation to thedemand in emerging markets. Leading manufacturers of LCD

next-generation growth domains in order to accelerate thepanels are aiming to target China’s domestic demand and haveestablishment of businesses.

expressed their intent for large-scale investment.

At the start of fiscal 2010, the next-generation growth

In order to enable continued and further growth for JSR, fivedomains of precision materials and processing, medical mate-goals including strengthening cost competitiveness andrials, as well as environment and energy were defined as

responding to globalization, ensuring the secure launch of“strategic businesses” where large future growth is expected.

strategic businesses have been set as foci for fiscal 2011.

These areas have received and will receive strategic allocation

As ongoing measures, JSR will strive to control cost increas-of resources to make these businesses the third pillar of busi-

Strategic Business6

Business Area (sector)
Precision Materials and Processing

Products
ITO sheets/films

Stage
Start of sales

Medical Materials

Blocking agents for in-vitro diagnostics and life sciences
Antibody conjugated magnetic beads
Chromatography media for antibody purification

Sales of product expanding
Sales of product expanding
Marketing

Environment and Energy

Lithium-ion capacitors
Binder materials for electrodes of lithium-ion batteries
Fuel cell electrolyte membranes
LED related materials
New alignment film materials

Sales of product expanding
Marketing and sales of product expanding
R&D
Start of sales
Sales of product expanding

JSR Corporation

ness growth in the next mid-term business plan. As shown inemerging markets, with trends such as the spread of com-the table, some products are at the sales stage, and anothermon, reasonable price-ranged goods.

several products are progressing to commercialization. We

Therefore, in the new plan, we will advance our businessare striving to combine our strengths to achieve our goals,

management based on the concepts of “uncertainty,” “diver-solidly advancing these initiatives and accelerating our returnsity” and “multipolarity,” aiming towards growth opportunities

to another growth track.

and pursuit of added value. For diversity, we will fully implement and promote the “E2 Initiative™,” which is JSR’s

4. Next Mid-term Business Plan:
Concepts and Initiatives

behavioral principle governing our consciousness of the environment and energy. In information and electronics, we will

In fiscal 2011, we will create our next mid-term business plan

investigate next-generation growth fields towards the year

aiming at continuous growth from the next fiscal year onwards.

2020, narrowing down the products and domains where JSRWith a long-term view of analyzing the business and social

exhibits its technological advantages. For multipolarity, we will

environments up to the year 2030, we will create a long term

fully utilize our local Chinese subsidiary across all our busi-

vision through 2020, and work to appropriately respond to anesses, and also enter other strategic regions. JSR will also

diverse and multipolar external environment.

focus on three strategic business sectors: precision materials

In our forecast for the forthcoming external environment andchanges to the social structure, we are focusing on the fol-and processing, medical materials, and environment/energy,
using greater focus to accelerate commercialization.

lowing key aspects: “uncertainty,” “diversity” and “multipolarity.”

Finally, the JSR Group has made its corporate philosophy

More diversity signifies that greater consciousness of energyof “Materials Innovation” the core of its business activities thus

problems and achieving a low carbon society is bringing a par-far. Providing value throughout society by developing innova-

tial shift from the focus on financially-driven economies towards

tive and competitive materials is the entire group’s identity

environmentally- and energy- friendly economies. Multipolarity

shared in pursuing our business. To develop our business,signifies that with the rising presence of emerging countries

JSR’s approach of continuously aiming higher, constantly

such as China and India, to match their populations and sizes,

breaking into new grounds and facing new challenges, are theour approach to growing and expanding emerging markets

factors which have underpinned JSR’s progress thus far. In

will become more important.

developing our global business, we will keep our fundamental

Up until 1990, the heavy industrial structure meant supplying a large volume of low-priced commodity products. The year

stance of fairness and uphold high ethical standards in ourforthcoming business policies.

2000s was the period in which an affluent society appreciated high performance and functionality as added value, andTo our shareholders, we thank you for your continued co-oper-

now we predict that there will be a move towards a more

ation and support.

diverse and multipolar society from 2010 onwards, with business fields expanding into the new industrial sectors of medical

June, 2010

materials and the environment. At the same time, we foreseehigh quality and high value added goods coexisting with

ANNUAL REPORT 20107

Special Feature

JSR’s Environmentally-friendly Products— Materials Innovation —1. Introduction
The JSR Group is conducting business activities based on its

In evaluating the life cycle of a tire, it is said that much of its
related CO2 is released while the tire is in use.

corporate philosophy — Materials Innovation. We believe thatAs a general rule, reducing the rolling resistance* caused bybroadly providing value to society through developing innova-

friction between the tire and road surface is essential to run antive and competitive materials underlies the entire Group’s

automobile more efficiently in terms of energy consumption.

shared identity in promoting and expanding our business.

However, simply reducing friction may compromise the tire’s“grip” on the road surface (the grip ability especially on wet

The business environment changes over time. Until the 1990s,

road surfaces), an essential property for steering on curved

heavy industries supplying general-purpose products in large

roads and braking, which produces safety concerns. Two con-volumes at low prices remained the mainstream. In contrast,

flicting characteristics (low rolling resistance and strong grip

the first decade of the 2000s assumed the picture of an afflu-

ability) must be satisfied to produce a fuel-efficient tire. To real-ent society where high performance and high functionality wereize such function, a new type of solution polymerization SBR

recognized as added value. Information and electronics tech-(S-SBR) was developed through the application of long-fos-nologies developed into industries matching the environment

tered developmental efforts at JSR. It is designed to reduceof the times in the 2000s. From the 2010s, we expect to see

the heat generated by friction (energy loss) to 45% below thatchanges in the traditional business environment and a struc-of conventional rubbers and achieve lower rolling resistance.

tural transition into a society based on diversity and multipolarity.

This was achieved by modifying terminal parts of a molecularAs values in society become more diverse and awareness of

chain for easy cross-linking between molecules of the basic

the importance of addressing issues such as energy, loweringrubber material that keeps gripping ability intact.

carbon dioxide emissions and global warming grows, we* Rolling resistance is the resistive force that hinders smooth rotation of the tire, andoccurs when a tire rolls across a surface. It is typically caused by deformation of
the tire due to contact with irregularities on the road surface and/or friction between
these surfaces. This force requires extra engine power. Thus, lower rolling resistance reduces the energy required to drive a car, resulting in higher fuel efficiency.

believe our society will shift its focus from economic efficiency, to environmental- and energy-consciousness. In recognizing
the changing business environment, it is important for us tobuild a business structure to ensure sustainable growth.

High

2. JSR’s Contributions to Reduce Environmental Impact
To address diverse environmental issues, provision of prod-

Rolling Resistance Index(%)

Low rolling resistance,
High grip ability

ucts with environmentally-friendly features is one of the major

100

Approx.
%45%
reduction

80

Energyloss 60

tasks a chemical company should perform. The following are40

examples of JSR’s environmentally-friendly products which
respond to the needs of a diversified society.

20

Grip
ability(1) Synthetic Rubber for Fuel-efficient Tires0
Conventional
S-SBR

New
S-SBR

Preferable
features offuel-efficient tireWith the increasing awareness toward reducing environmental impact, there is growing demand for fuel-efficient tires. In
Europe and Japan, the operation of a labeling system for tires*will be gradually commenced as an effort to promote the adoption of fuel-efficient tires.
* In Europe, the operation will commence in 2012. In Japan, the Japan Automobile
Tyre Manufacturers Association established voluntary standards for the industry, entitled “Guidelines for Indication regarding Promotion of Fuel-efficient Tires,etc.,” and operation of the labeling system has gradually commenced since
January 2010.

8

JSR Corporation

High rolling resistance,
Low grip ability
Low

Rolling resistanceHigh

(LUMILON™ series), which were launched in March 2010.
Two of these are used in LED packaging processes: an organic-inorganic hybrid sealing material and a high refractive index
coating material applied to luminous elements for increased
luminance efficiency. The other three are materials used in the
production processes of LED elements: an inorganic coating
material for insulation, the same material with added photosensitivity for patterning, and a lift-off resist material used forelectrode formation.
(4) Display Materials for Next-generation LCD TVs
Lower production costs and higher energy efficiency, as wellas high performance, are the major objectives in the development of next-generation LCD TVs. To reduce energy
consumption, for example, LED modules with higher luminance
JM Energy ULTIMO ®

efficiency are used for backlighting in place of fluorescent tubes,
and a wide aperture LCD panel is employed. To address these(2) Lithium-ion Capacitor

new technologies, JSR is offering a variety of high perform-

The capacitor is an electrical storage device which stores

ance materials for LCD panels including new alignment films.

(charges) and uses (discharges) energy as required. It allows

Global demand for LCD materials is projected to grow and JSR

charge and discharge cycles semipermanently, and its abili-

will ensure a stable supply of high-quality products from its

ty to store and release energy instantaneously holds great

three production bases located in Japan, Korea, and Taiwan.

promise for efficient use of energy in a wide range of applications. JM Energy Corporation, a JSR Group company, has

3. Scope for the Future

developed lithium-ion capacitor technologies that enables

As a chemical company that must respond to environmental

much larger energy storage than was previously possible in aissues, the JSR Group has devoted its energy to developing

compact package.

and manufacturing products that contribute to reducing envi-

The market size for this line of products is expected to growronmental load. To cope effectively with the variety of issues

substantially, and development efforts are underway in a vari-

and risks arising from environmental- and energy-related areas,

ety of applications such as voltage sag compensator, wind

JSR has adopted a new “E2 Initiative™” concept, which guides

and solar renewable energies and industrial machines. JM

the way of thought and behavior that should be embedded in

Energy Corporation has a commercial production plant inall our business processes. All our future efforts in business

Yamanashi Prefecture.

development will be based on this initiative. The “E2 Initiative™”
will be a common platform that prevails in all our business(3) Performance Materials for High-luminance LEDs

domains, and we are pursuing exploration and start-up of new

There are growing market needs for high-luminance LEDs,

business opportunities in the environment and energy related

which are extensively being used in a variety of applications

business domains, thus creating new environmentally-friend-such as for in-car use, various lighting fixtures and displays,

ly products and businesses.

as well as components to reduce environmental impact. In

Each of our business lines will actively explore opportunities

order to respond to such market needs, JSR has developed

for new environmentally-friendly products based on this con-materials for high-luminance LEDs in five product types

sistent way of thought and behavior.

ANNUAL REPORT 20109

At a Glance
Proportion of Sales

Segments

Fine Chemicals and Other Products
Fine Chemicals and Other Products

Information and electronics materials, mainly for semiconductors and flat
panel displays, are the largest component of this segment.

45.3%

Net Sales

Operating Income / Operating Margin(Billions of Yen)

200

(Billions of Yen)

(%)

50
40
30
20
10
0

150
100
50
0

FY’06 FY’07 FY’08 FY’09 FY’10

50
40
30
20
10
0

FY’06 FY’07 FY’08 FY’09 FY’10
Operating Income* [Left]
Operating Margin [Right]* Operating income includes company-wide costs
for fundamental research and development.

Petrochemicals
Elastomers

Petrochemicals
Elastomers

33.7%

The main products in this segment are synthetic rubbers and thermoplastic
elastomers (TPE). JSR is one of the world’s largest manufacturers of synthetic rubber.

Emulsions

5.5%

Net Sales

Plastics

Operating Income / Operating Margin(Billions of Yen)

150

15.5%

100
50
0

(Billions of Yen)

(%)

12

12

8

8

4

4

0

0

-4

-4

FY’06 FY’07 FY’08 FY’09 FY’10

FY’06 FY’07 FY’08 FY’09 FY’10
Operating Income [Left]

Overseas Sales

Operating Margin [Right]

Emulsions(Billions of Yen)

500

Emulsions are liquids in which synthetic rubber or synthetic resin have beendispersed in water, such as paper coating latex (PCL) and acrylic emulsions.

400

Net Sales

Operating Income / Operating Margin(Billions of Yen)

300

(Billions of Yen)

(%)

30

3

12

20

2

8

10

1

4

0

0

FY’06 FY’07 FY’08 FY’09 FY’10

0

FY’06 FY’07 FY’08 FY’09 FY’10
Operating Income [Left]

200

Operating Margin [Right]

Plastics

100

The major product in this segment is ABS plastics, a material with well-balanced properties which is used in many applications worldwide.
0

FY’06

FY’07

FY’08

FY’09

FY’10

Net Sales

Operating Income / Operating Margin(Billions of Yen)

North America
Asia
Japan

(Billions of Yen)

4

8

60

3

6

Overseas
Sales Ratio

40

2

4

20

1

2

44.8%

0

0

FY’06 FY’07 FY’08 FY’09 FY’10

0

FY’06 FY’07 FY’08 FY’09 FY’10
Operating Income [Left]
Operating Margin [Right]

10

JSR Corporation

(%)

80

OthersProducts

Applications

Semiconductor Materials•Lithography materials (photoresists, multilayer materials and others)•CMP materials (CMP slurries and pads)•Interconnect materials (spin-on low-k materials)•Packaging materials (thick-film photoresists, photosensitive insulation materials and others)
Flat Panel Display (FPD) Materials•LCD materials (alignment films, protective coatings, color pigment
dispersed resists, photosensitive spacers and others)•Optical films (ARTON® films)
Optical Materials•Opto-functional materials (anti-reflective coatings, UV curing opticalfiber coatings, heat-resistant transparent resin ARTON®)

Semiconductor Materials•Process materials for semiconductor manufacturing
FPD Materials•Process materials for liquid crystal display (LCD) panels•Process materials for plasma display panels (PDP)
Optical Materials•Anti-reflection for display surfaces, organic / inorganic hybrid
hard coating materials, prism lens, adhesive for opticaldiscs, etc.
•Optical fiber coating materials, three-dimensional free-form
fabrications•Optical lens, retardation films, light guiding plates, etc.

General-Purpose Synthetic Rubbers•Styrene-butadiene rubber (SBR)•Poly-butadiene rubber (BR)Special-Purpose Synthetic Rubbers•Acrylonitrile-butadiene rubber (NBR)•Butyl rubber (IIR)•Ethylene-propylene rubber (EPR/EPM/EPDM)
Thermoplastic Elastomers (TPE)•Syndiotactic 1,2-Poly-Butadiene “JSR RB®”
•Hydrogenated polymer “DYNARON®”•Styrene-butadiene block copolymer “JSR TR”•Styrene-isoprene block copolymer “JSR SIS®”

General-Purpose Synthetic Rubbers•Automotive tires
Special-Purpose Synthetic Rubbers•Automotive parts, industrial rubbers, etc.
Thermoplastic Elastomers (TPE)•Various shoe soles, injection molding items•Hot melt adhesives, hot melt binders

Emulsion Products•Paper coating latex (PCL)•SB latex•Acrylic emulsions
Performance Chemicals•High-functional dispersant “DYNAFLOW®”•Organic/inorganic hybrid coating material “GLASCA®”•Standard particles•Particles for clinical diagnostics•Research reagents

Emulsion Products•Carpet backings, various binders•Coating paper for printing purposes•Floor polish, paint, binders, adhesives
Performance Chemicals•Anti-staining coating materials•Exterior coatings, various functional coating materials•Acrylonitrile-butadiene-styrene (ABS) plastics•Acrylonitrile-ethylene-propylene-styrene (AES) plastics•Automotive parts, electrical appliances, office automationequipment, etc.
•Automotive parts, electrical appliances, house-building
materials, etc.

ANNUAL REPORT 201011

Review of Operations

Fine Chemicals and Other Products

JSR’s Fine Chemicals and Other Products main-

Proportion of Sales

ly consist of materials for semiconductors, flat
panel displays (FPDs), and optical materials.

45.3%

These business lines are seeing steady expansions of argon fluoride (ArF) photoresists andmultilayer materials used for semiconductors,
as well as alignment films and color pigmentdispersed resists used for liquid crystal display(LCD) panels.

Net Sales and Operating Income(Billions of Yen)

200

50

160

40

120

30

80

20

40

10

0

0

FY’06

FY’07

FY’08

FY’09

Net Sales [Left]
Operating Income* [Right]

Main Products

FY’10* Operating income includes
company-wide costs for
fundamental researchand development.

Fiscal 2010 Business Performance:
Semiconductor Materials

Lithography Materials for Immersion Technology

Demand for semiconductors was seeing clear recovery in

JSR provides advanced ArF

Japan, Asia and the U.S., mainly in laptop PCs and smart-photoresists and other materi-phones. This led to a recovery of sales in argon fluoride (ArF)

als for immersion technology,

photoresists, multilayer materials, and chemical mechanicalsuch as topcoat materials andplanarization (CMP) materials. However, sales during the whole

multilayer materials, recognizedyear did not reach the levels of the previous year, resulting in

as top-tier products in the global market. Photoresists arelower net sales year-on-year.

photo-sensitive resin materials applied to a silicon substrate
to form circuit patterns onto the substrate surface.

A new advanced lithography materials plant began operating at the Yokkaichi Plant, starting commercial production of
ArF photoresists since November 2009. This will respond tohigher demand for ArF photoresists due to the full scale launch

OPTMER® AL Series: Alignment Films for LCD Panelsof 40 nanometer generation semiconductor processes. At the

The OPTMER® AL is a material

same time, JSR is focusing to further reinforce its competitive

used to align liquid crystal mol-advantages in this regard by meeting high quality requirements

ecules, sandwiched between

and building a stronger base that stably and efficiently supplies

two glass substrates inside an

products.

LCD panel, to a specific orientation. The application of alignment film technologies have

Flat Panel Display (FPD) Materials

improved LCD TV contrast (black/white luminance ratio) andAlthough a declining trend is seen in prices of LCD panels,

resolved the issue of viewing angle. JSR’s alignment films

domestic and foreign economic stimulus packages boosted

are recognized for technical achievements which include

LCD TV market demand above that of the previous year, and“The Chemical Society of Japan’s 58th Award for Technicalthe release of a new operating system also created firm lap-

Development” for contribution to widespread use of LCD

top PC demand, resulting in higher net sales year-on-year.

TVs today.

Our consolidated subsidiary JSR Micro Kyushu Co., Ltd.
completed an expansion of its advanced LCD material production facility in August 2009. It went through its trial operation

12

JSR Corporation

and certification work for customers, and began commercial

Fiscal 2011 Business Strategy

production in April 2010. JSR will be working to meet the grow-Core Businesses (semiconductor materials, flat panel

ing demand for LCD materials at our Yokkaichi Plant, JSR Microdisplay (FPD) materials, optical materials)

Korea, and JSR Micro Taiwan.

Our core businesses are seeing higher demand for final products, especially in emerging countries, with fast overall global

Optical Materials

growth. However, while these demand industries have increas-

Sales of optical coating materials, the mainstream product ofing needs for materials which require new added-value throughthe optical materials division, were steady overall. Despite weakdevelopment and progress in new technologies, the increasing

domestic demand for optical fiber cables, there was strong

commoditization of digital technologies is also leading to lower

export demand for optical fibers with large growth to China

prices. This appears to be a trend towards a polarized market.

and other emerging markets. Anti-reflective coating materials

Based on this understanding of the business environment,

and protective coating materials were increasingly adopted by

JSR is working to expand its product lines to meet new needs

the high value-added sector paralleling the trend in flat screenby utilizing cutting-edge technologies. The Company is also

TVs becoming more high-definition. ARTON® resin (heat-resist-actively expanding in emerging markets, especially China. JSR

ant transparent resin) saw more intense competition in theis working to expand the semiconductor materials business

optical film sector, but was steady in resin sales and the pre-by launching new products such as next-generation lithogra-

cision processing sector. For optical materials as a whole, net

phy materials. The Company is also working to expand the flatsales increased year-on-year.

panel display materials business by accurately meeting userneeds, such as the launch of new alignment films. In the

Progress in the Strategic Businesses

Chinese market, JSR is establishing a strongly localized mar-

We have positioned sectors where large future growth is expect-keting organization with JSR (Shanghai) Co., Ltd. as its base,ed as “strategic businesses”: precision materials and processing,and is developing the organization to supply high quality prod-

medical materials, as well as environment and energy, and haveucts. Additionally, in response to a polarized market, JSR isbeen enhancing the structure to promote these businesses.

streamlining business costs and enhancing competitivenessOur strategic businesses are producing solid results. For

by implementing measures such as further promoting the “E-example, in the current fiscal year, JSR launched a new series

100 Projects,” optimizing the globally expanding productionof high-luminance LED related materials under the name ofbases, and globalizing the procurement of raw materials.

LUMILON™, such as encapsulants, highly refractive coatingsand insulation materials. JSR also began selling samples ofStrategic Businesses

touch panel sheets/films for mobile terminals and touch panel

JSR will further focus on the strategic allocation of resources toPCs, and there is growing domestic and foreign adoption ofaccelerate the development of these strategic businesses intobinder materials for lithium-ion batteries.

a third source of earnings, alongside the petrochemicals business and the information electronics materials business.

Earnings:

Specifically, JSR will accelerate the establishment of the pre-Cost reduction efforts were made through the promotion ofcision materials and processing business, such as touch panel

the Cost-Reduction Plan “E-100 Projects,” along with measures

sheets/films. In the medical materials business, the Company

that focus on reducing fixed costs. Despite these efforts, prof-

will work toward solid progress by building business infra-

its were the same as in the previous year due to weak demand,

structure in areas such as immunodiagnostic agents andthe appreciation of the yen, and higher costs in the strategic

reagents, based on particle technologies. JSR will work to fur-businesses which receive strategic allocation of resources.

ther expand the environment and energy business by solidly
developing a wide range of uses, such as battery materials,

As a result, consolidated net sales in the fine chemicals andLED materials and lithium-ion capacitors. Lithium-ion capac-

other products segment declined 4.0% year-on-year to ¥140.5

itor devices are increasingly used in devices which compensate

billion, with operating income declining 0.2% year-on-year tofor a momentary drop in voltage and power failures; JSR will

¥20.5 billion.

develop further uses and expand the business globally.

ANNUAL REPORT 201013

Review of Operations
Petrochemicals

Elastomers

Since its foundation, JSR has offered a wide

Proportion of Sales

range of elastomer products for the world market including: general-purpose synthetic rubbers

33.7%

such as styrene-butadiene rubbers (SBR) developed for automotive tires; and special-purpose

Net Sales and Operating Income(Billions of Yen)

synthetic rubbers such as acrylonitrile-butadi-

150

15

ene rubbers (NBR), butyl rubbers (IIR), and

100

10

ethylene-propylene rubbers (EPR). JSR also

505offers thermoplastic elastomer materials (TPE).

0

0

FY’06

FY’07

FY’08

FY’09

FY’10

Net Sales [Left]
Operating Income [Right]

Main Products

Fiscal 2010 Business Performance:
Synthetic Rubbers

Styrene-butadiene Rubber (SBR)

With regard to domestic sales of synthetic rubbers, although

Styrene-butadiene rubbers

demand for general-purpose rubbers such as styrene-butadi-(SBR) are used in many appli-

ene rubbers (SBR) and polybutadiene rubbers (BR) for

cations across industries. JSR

automotive tires showed signs of recovery; overall demand

products are top class in theremained low. This resulted in a substantial decline in net sales

Japanese market. The largest

year-on-year. For high-performance special-purpose rubbers,

application is in automotive

such as acrylonitrile-butadiene rubbers (NBR) and ethylene-tires, and JSR is making a large contribution to increasing the

propylene rubbers (EPR), although sales volume in the second

performance of these products through the development ofhalf increased year-on-year as a result of recovery in automo-

solution polymerization SBR (S-SBR) for high performance

bile production due to the effects of tax reductions forenergy efficient tires.

environmentally-friendly vehicles and other measures, sales
volume during the whole fiscal year remained low, and net sales

Thermoplastic Elastomers (TPE)decreased year-on-year. In focusing on exports of general-

TPEs exhibit rubber-like elas-

purpose synthetic rubbers, as a result of sales expansion to

ticity at room temperature,

Asian countries such as China, which has shown a high growth

and at elevated temperature

rate of automobile production; net sales grew substantially

soften to enable molding into

year-on-year.

any shape. It allows remolding, making it a recycle-friendly

Thermoplastic Elastomers (TPE)material. TPEs are used mainly in shoe soles, however they are

For TPEs, such as butadiene and styrene-butadiene thermo-

increasingly used for automobile components in recent years

plastic elastomers, sales were low during the first half of the fiscal

because they are lighter than synthetic rubber, also reducing

year. In the second half, along with recovering sales of TPEs forCO2 emissions in the factory due to their simpler production

automobile use, foreign demand mainly in TPEs use for shoeprocesses, as well as expanding the range of recyclable parts.

soles in Europe, Central and South America became robust. As
a result, net sales were the same as in the previous year.

14

JSR Corporation

Production Profile
Products

Production Capacity of Plant

Products

Styrene-butadiene rubbers (SBR)
Acrylonitrile-butadiene rubbers(NBR)
High styrene rubbers (HSR)
Polybutadiene rubbers (BR)
Solution polymerization styrenebutadiene rubbers (S-SBR)
Hydrogenated polymer(DYNARON®) and others
Polyisoprene rubbers (IR)Yokkaichi — 255,000 tons/year

Butadiene thermoplastic elastomers Chiba — 24,000 tons/year(JSR RB®)

Chiba — 72,000 tons/year
Yokkaichi — 45,000 tons/year

Styrene thermoplastic elastomers(SBS, JSR SIS®)

Ethylene-propylene rubbers (EPR)

Butadiene
Kashima — 41,000 tons/year(Manufactured by KRATON JSR
Elastomers K.K.)
Kashima — 36,000 tons/year

Isoprene

Production Capacity of Plant

Kashima — 45,000 tons/year(Manufactured by KRATON JSR
Elastomers K.K.)
Yokkaichi — 148,000 tons/year
Chiba — 130,000 tons/year(Manufactured by Tobu
Butadiene Co., Ltd.)
Kashima — 120,000 tons/year
Kashima — 36,000 tons/year

Earnings:

originality and technological superiority, and to optimize theCost reduction efforts were made through the promotion of

supply chain of the products. Specifically, by utilizing Dow

the Cost-Reduction Plan “E-100 Projects,” along with measures

Europe GmbH, for which JSR obtained capacity rights forthat focus on reducing fixed costs. Price revision efforts were

30,000 tons, JSR will further strengthen the growing sales ofalso made in response to higher raw material prices. Althoughsolution polymerization SBRs (S-SBR) for energy conserving

earnings improved due to recovering demand, a large drop in

and high performance tires for users in Europe and Asia. To

demand, especially in the first half, as well as inevitable pro-

respond to the increased demand for butyl rubbers (IIR) used

duction adjustments resulted in the decline of profit margins

for the inner tubes of large-sized automotive tires for vehicles

which led to an operating deficit.

such as buses and trucks as well as radial tires for vehicles,
JSR has decided to increase the production capacity of IIR by

As a result, consolidated net sales in the elastomers segment

18,000 tons at Japan Butyl Co., Ltd., an equity method affiliate.

declined 11.2% year-on-year to ¥104.6 billion, with operatingThis increase in production capacity is set to be complete by theloss decreasing by ¥8.5 billion year-on-year, leading to a deficit

end of 2010. JSR will certainly make this capacity enhance-of ¥0.5 billion.

ment functional and effective.

Fiscal 2011 Business Strategy

market, JSR will work to strengthen the marketing system

In the main demand industries in Japan’s petrochemical busi-

based at JSR (Shanghai) Co., Ltd., and to further expand sales.

ness sector, such as automobiles and automotive tires, there

In regards to the stable procurement of raw materials, JSR

In expanding and emerging markets, especially the Chinese

are concerns that large growth cannot be expected in years

will focus on securing new raw material sources overseas.

to come and that long-term stagnation will occur. However, it

To further secure stable profitability, JSR will continue tois expected that needs for high-value-added materials that

put efforts into the promotion of the “E-100 Projects,” alongcontribute to the reduction of environmental impact will grow,with drastic cost-structure reforms, such as cutting fixed

and that a continuous expansion in emerging markets, main-

costs, and dramatic productivity enhancements, including

ly in China will be seen. In regards to the management of major

the integration of production lines.

raw material supplies, there are also concerns about constrained availability caused by consolidation of domestic
ethylene centers.
Amidst this environmental awareness, JSR will work to
expand global sales of highly competitive products utilizing our

ANNUAL REPORT 201015

Review of Operations
Petrochemicals

Emulsions

A material with special functions based on emul-

Proportion of Sales

sion polymerization technology developed
through the process of manufacturing synthetic

5.5%

rubbers. A main emulsion product is paper coating latex (PCL), which has the top share in the

Net Sales and Operating Income(Billions of Yen)domestic market. Styrene-butadiene latex is also

30

3developed as various types of adhesive, such20

2

as carpet backings.

10

1

0

0

FY’06

FY’07

FY’08

FY’09

FY’10

Net Sales [Left]
Operating Income [Right]

Main Products

Fiscal 2010 Business Performance:
For paper coating latex (PCL), the main product of this seg-

Paper Coating Latex (PCL)

ment, the drop in production of coated paper contributed to a

PCL has a wide range of appli-

substantial decline in net sales year-on-year. For general indus-

cations to coat papers, fromtrial latex, exports had shown steady performance due tohigh-grade art papers for print-

growing sales, mainly in China and Taiwan. Nevertheless, low

ing art books, to miscellaneous

demand in areas related to domestic construction and auto-

papers for advertising leaflets

mobiles resulted in a substantial decrease in net sales

with excellent adhesive per-year-on-year.

formance and printability.
Earnings:
Cost reduction efforts were made through the promotion of the
Cost-Reduction Plan “E-100 Projects,” along with measuresthat focus on reducing fixed costs. Price revision efforts were

Production Profile

also made in response to higher raw material prices. Despite
Products

Production Capacity of Plant

Latex

Yokkaichi — 120,000 tons/yearthese efforts, demand dropped substantially, and profits fell far
below those of the previous year.
As a result, in the emulsions segment, consolidated net sales
declined 27.5% year-on-year to ¥17.0 billion, with operating
income declining 46.2% year-on-year to ¥0.3 billion.

16

JSR Corporation

Review of Operations
Petrochemicals

Plastics

JSR is operating its plastics business under

Proportion of Sales

Techno Polymer Co., Ltd. Techno Polymer offers
various acrylonitrile-butadiene-styrene (ABS)

15.5%

plastic products that customers seek. The company’s ABS products are noted for uniqueness,based on the combined characteristics of various polymers. The company provides ABS
products with consistent quality, backed by its
worldwide bases of sales and technical services.

Net Sales and Operating Income(Billions of Yen)

80

4

60

3

40

2

20

1

0

0

FY’06

FY’07

FY’08

FY’09

FY’10

Net Sales [Left]
Operating Income [Right]

Main Products

Fiscal 2010 Business Performance:
In the domestic market, although sales for automobiles turned

ABS Plastics

upward, sales volume for the whole fiscal year fell year-on-year.

ABS Plastics excel in such prop-

Low sales across demand industries, due to factors including

erties as impact resistance, heat

low demand in building materials and in the entertainment sec-

resistance, high rigidity, glossi-

tor, resulted in lower net sales year-on-year. Similarly for

ness, and processability, andexports, despite the recovery trend for automobiles, sales vol-are used in various applications,ume decreased year-on-year. In addition, low demand bothsuch as industrial products,

for office automation equipment and in the entertainment sec-

automotive components, elec-

tor resulted in a substantial decline in net sales year-on-year.

trical appliances, and game consoles. Flame-resistant grade
ABS excels in fluidity and thermal stability, has good practical

Earnings:

heat resistance and well-balanced mechanical strength prop-

Cost reduction efforts were made through the promotion oferties as well as excellent impact resistance.

the Cost-Reduction Plan “E-100 Projects,” along with measures that focus on reducing fixed costs. Price revision efforts
were also made in response to higher raw materials prices.
Despite these efforts, the substantial drop in demand, as wellas the impact of the appreciation of the yen, did not make up

Production Profile
Products

for the decline in profit margins, leading to an operating deficit.
Production Capacity of Plant

Acrylonitrile-butadiene-styrene Yokkaichi — 280,000 tons/year
plastics (ABS)(Manufactured by Techno
Acrylonitrile-ethylene-propylene- Polymer Co., Ltd.)styrene plastics (AES)
Acrylonitrile-styrene-plastics(AS)

As a result, consolidated net sales of the plastics segment
declined 25.9% year-on-year to ¥48.0 billion, with operating
loss decreasing by ¥1.3 billion year-on-year, leading to a deficitof ¥3 million.

ANNUAL REPORT 201017

Research and Development, Intellectual Property

1. Core Technologies and the JSR Business Model(2) De Facto Standards

Expertise in polymerization gained from the manufacture of syn-By transforming diverse user needs into products suitable forthetic rubbers and other petrochemical products represents

many applications, JSR strives to create products that become

JSR’s core technologies. Leveraging this know-how, JSR has

the de facto standard in their respective categories. Success ingrown by responding quickly and accurately to the technolog-

the information electronics materials business requires this deical demands of customers concerning information electronics

facto standard approach. Building ties rooted in trust with thematerials. In addition, next-generation businesses will be root-

most advanced users in a targeted category is the most effec-

ed in the even more effective use of these core technologies.

tive means of establishing a de facto standard. JSR and theseThrough this process, JSR is dedicated to developing newpartners can then jointly develop innovative products and quick-materials along with new business domains.

ly bring them into the market.

Growth atJSR is driven by the following three business models:(3) Clusters(1) Global Leadership

Cluster refers to a business made up of many niche markets,

Information electronics materials products pose unique chal-

each with annual sales of a few billion yen. JSR gathers a num-lenges. Most become outdated rather quickly and no single

ber of interrelated products to create a single business unit.

product makes a significant contribution to sales. For this rea-

The image is similar to how many grapes combine to makeson, it is imperative to secure powerful market positions

one bunch. Taking this approach raises the efficiency ofworldwide. This strength provides quick access to information

research, manufacturing and sales. To generate more bene-on next-generation technological breakthroughs that can befits, JSR is moving quickly to build more clusters.

used for new research projects. With this in mind, JSR began

JSR is confident that adherence to these three businessestablishing a global presence at an early stage, supplying

models will give the company a solid base to grow for many

products to prominent companies in many countries.

years to come.

2. R&D and Intellectual Property Organization and R&D Alliances(1) R&D and Intellectual Property Organization
Performance Polymer
Research Laboratories

Rubber for tires, specialty rubbers, functional elastomers,
thermoplastic elastomers, etc.

Performance Chemicals Lab.

Latex for paper coating, functional emulsions etc.

LCD Materials 1st Lab.

Protective coatings and color pigment dispersed resists for LCDs, etc.

LCD Materials 2nd Lab.

Alignment film for LCD,etc.

Fine Electronic Materials
Research Laboratories

Semiconductor Materials Lab.

Photoresists for semiconductors, etc.

Process Development &Engineering Group18

Polymer Materials Lab.

Display Materials
Research Laboratories

Yokkaichi ResearchCenterPrecision Processing
Technology Center

As of June 18, 2010

Packaging and Assembly Materials Lab. Thick film photoresists, photo sensitive insulation materials for LSI, etc.
Petrochemical Process Dept.

Development of manufacturing processes and engineering forthe petrochemicals business

Fine Chemical Process Dept.

Development of manufacturing processes and engineeringof fine chemicals, medical materials and other new businesses

High Performance Resin Process Dept.

Product development of new types of high performance resins,development of manufacturing processes and engineering

Research Fellow Lab. (Yokkaichi)

Functional materials for LIB, encapsulation materials for LED, etc.

Microfabrication Process Materials Lab.

CMP materials (slurries, pads), etc.

Material Characterization & Analysis Lab.

Physical properties, analysis, characterization, CAC, etc.

Yokkaichi R&D Administration Dept.

R&D administration in Yokkaichi area

Precision Processing
Research Laboratories

Processing Research Laboratories

Technological development for precision processing

Processing Materials Lab.

Converting products on optical films, ARTON® film, etc.

Tsukuba Research Laboratories

Optical fiber coating, radiation curing materials, particles for diagnosis,
low-k films for LSI, etc.

Research Fellow Laboratories (Tsukuba)

Materials for fuel cells, etc.

Research & Development Department

R&D strategic initiatives and administration

Intellectual Property Department

Business related to intellectual property rights

JSR Corporation

Yokkaichi Research Center

Tsukuba Research Laboratories

R&D Organization

R&D Expenses by Business Segment
for Fiscal Year 2010

Yokkaichi Area

Tsukuba Area

Yokkaichi
Research Center

Tsukuba
Research Lab.

Elastomers

Emulsions

Plastics

7.7% 3.3% 5.2%

R&D
Dept.
Precision Process
Technology Center

Petrochemicals

Research Fellow Lab.
(Tsukuba)
Fine Chemicals
and
Other Products

Assigned to
Yokkaichi AreaIntellectual
Property Dept.
centralized( management
)

83.8%

Assigned to
Tsukuba Area

Total ¥18.2 billion(2) R&D Alliances

strategy that is made up of the following four components:

JSR establishes R&D alliances as required to achieve strategic objectives. Most alliances are with customers conducting

a. Participation in the creation of intellectual property

businesses that use leading-edge technologies.

JSR takes part in 3C analysis of intellectual property and technological information beginning at the stage of searching for

3. Summary of R&D Segments and Intellectual Property

R&D themes. The results of this analysis are incorporated in

JSR aims to build and enhance intellectual property (IP) net-

R&D activities. Furthermore, by being selective in its intellec-

works in all its R&D segments by creating IP, such as patents,

tual property rights applications, JSR will enhance consistency

knowhow, designs, and trademarks, as well as by acquiring

between its technological development and patent application

and utilizing IP on a global scale. By strategically utilizing thesestrategies.

networks, JSR aims to attain a predominant position over competitors in its businesses.

b. Acquisition of intellectual property

One priority is information electronics materials and other

JSR always seeks to secure the broadest possible rights to its

businesses outside the petrochemicals field. The goal is to

R&D achievements. The aim is to acquire “usable rights” that

acquire IP that can support global expansion. In this regard,can contribute to industry-wide progress and be licensed to

JSR is focusing not only on Europe and North America, butother companies. Portfolio management of intellectual prop-

also on Asia, chiefly South Korea, Taiwan and China, as aerty is conducted in accordance with potential earnings andsource of IP to build and expand its IP network.

the degree of innovation. Clearances are received for the use

Another theme is creating IP in fields where JSR aims to cre-of patents in JSR products and JSR acquires strategic patents

ate new businesses that use sophisticated technologies.

that have the potential of becoming more valuable in the future.

4. Policy for Acquisition andc. Use of intellectual property rights

Management of Intellectual Property

JSR makes effective use of its own patent rights and utilizes(1) Strategy for Intellectual Property

the intellectual property of other companies by entering into

JSR uses intellectual policy based on an intellectual property

individual licensing and cross-licensing agreements. The goal

ANNUAL REPORT 201019

is to preserve the continuity of business activities and the free-the department to help create intellectual property and quick-dom of R&D programs. JSR also assesses and manages

ly submit well-prepared patent applications.

potential risks in its intellectual property portfolio.

In addition, JSR and its group companies use an organizedapproach to effectively use their intellectual property and obtaind. A global perspective

worldwide patents. All matters concerning intellectual proper-

JSR will secure a competitive edge in its businesses by devis-

ty are managed by the JSR head office to keep this information

ing a global intellectual property strategy that covers not only

confidential and prevent leaks of technological information.

patents, but also trademarks and brands. In addition, JSR is

JSR has an intellectual property award and bonus system

upgrading the skills of its Intellectual Property Department andto increase motivation to come up with new ideas and follow

strengthening ties with patent offices in other countries. This

through with inventions. The system distributes payments inwill allow JSR to acquire and utilize intellectual property rights

line with JSR’s workplace invention system when patent appli-

according to the circumstances of each country and region.

cations are submitted, when a patent is registered and when apatent generates earnings.

(2) Framework for Using Intellectual Property
JSR’s framework for using intellectual property is distinguished(3) Acquisition Policy of Intellectual Property

by two elements: a system closely linked to R&D laboratories,

JSR will continue to proactively acquire intellectual property

which identifies ideas that should be patented, and a central-

especially in new technological fields for growing markets allized management system for intellectual property.

over the world based on a mid-term business plan. The

JSR’s Intellectual Property Department assigns staff mem-

expenses will be concentrated in acquiring strong and com-bers to work in the Yokkaichi area and Tsukuba area. By

petitive intellectual properties.

maintaining close ties with R&D activities, this approach allows

5. Contribution of Patents

Number of Patents
acquired in each Fiscal Year

JSR is continuing to acquire patents and is expanding its business globally.

(Patents)

The following table summarizes patents held by JSR:

Petrochemicals

As ofPatents (Japan)
Patents (Overseas)

600

Fine Chemicals
and
Other Products

500

OthersTotal
400

09.3.31 10.3.31 09.3.31 10.3.31 09.3.31 10.3.31 09.3.31 10.3.31

428
512

374
492

1,269
1,955

1,465
2,164

73
34

75
39

1,770
2,501

1,914
2,695

300
200
100
0
FY’05 FY’06 FY’07 FY’08 FY’09 FY’10
Domestic
Overseas20

6. Policy Regarding Intellectual Property Portfolio

7. Information Regarding Risk

JSR follows a policy of retaining rights to intellectual property

There are no risks involved with JSR’s patents or licensingthat can be used to give its products a competitive edge. Other

agreements that could have a material impact on cash flows.

intellectual property having potential applications is retained

Furthermore, in its business operations, JSR exercises careor, if necessary, provided to other companies through licens-with regard to the patents and rights of other companies,

ing agreements. JSR does not keep rights to intellectual

quickly conducting investigations where necessary and strict-property that have no potential applications.

ly complying with all laws.

JSR Corporation

The JSR Corporate Social Responsibility Report

The JSR Group mission is to act with integrity as a “good cor-energy unit consumption, JSR has set a new target for reduc-porate citizen,” to live up to the trust our stakeholders place ining the absolute amount of CO2 emissions (reducing emissions

us, and to contribute to the realization of a more prosperous

in fiscal 2013 by 6 % compared with fiscal 1991).

human society through our business activities. Our Group CSR

A large-scale natural gas-fired gas turbine cogeneration sys-

represents the initiatives we employ to successfully achievetem (newly-established cogeneration system) was installed atthese missions and as such, we view CSR as a key manage-

the Yokkaichi Plant in April 2010. Compared with the current

ment issue.

coal-/C heavy oil-fired steam boiler and steam turbine condenser system, carbon dioxide emissions are expected to be

The world faces many important issues today, whether it iscut through the use of natural gas as fuel. The effect of reduc-global warming, depletion of resources and food supplies, or theing the emissions will be confirmed at the end of this fiscal year.

issue of human rights. The impact that corporate activities havewith regard to these issues is quite significant, and the activities

2. Participating in the United Nations Global Compactof the JSR Group are no exception. Based on this under-

On April 14 2009, the JSR Group became a participant of thestanding, the JSR Group established the CSR Committee*1 in

Global Compact policy advocated by the United Nations. By

fiscal 2004, which has since been involved in CSR activities

doing so, we declare as a global organization that we are act-

focusing on corporate ethics and environmental/safety efforts.

ing responsibly in the international community and are working

In June 2008, in order to take these initiatives to an evenhard to proactively execute “corporate social responsibility.”

higher level, we launched a new
Corporate Social Responsibility

3. Social Contribution Activities that Befit JSR

Department, which is advancing

A major challenge facing Japanese society today is our chil-

CSR efforts in the two areas ofdren’s waning interest in science. In response, JSR is working“corporate obligations” and “social

with local Board of Educations to conduct science classes atcontribution.” For details about

junior high schools. This year, the program was implemented

CSR activities of the JSR Group,at Yokkaichi City, Mie Prefecture and Kamisu City, Ibaraki

please refer to the CSR Report (toPrefecture. Students are taught that all matter is made up of

be issued in July 2010).

molecules and that properties of a substance differ depending on the way in which these molecules are joined together.

Major CSR Activities

They also learn that everyday items around them consist of
materials which contain molecules joined together in a variety

1. Initiatives to Prevent Global Warmingof combinations. In order for children to become more inter-

With regard to reducing the amount of carbon dioxide emis-

ested in science, students are given explanations with teachingsions, JSR has advanced measures concentrated on energy

materials and experiments that are not available as part of thesaving. Instead of maintaining our previous target for reducing

usual school curriculum.

http://www.jsr.co.jp/jsr_e/csr/index.shtml
ANNUAL REPORT 201021

Corporate Governance and Compliance

As of June 18, 2010

Shareholders’ Meeting
Appointment/
Dismissal

Appointment/
Dismissal

Reports

Reports
FinancialauditsAuditsBoard of Auditors

Appointment/
Dismissal

Board of Directors
Reports
Appointment/Dismissal

Cooperation

Reports

Cooperation
Corporate Ethics
Committee

Reports
Executive
Committee

Representative
Directors

Responsible Care
Committee

Officers
Committee

Internal Audit
Department

Independent Financial
Accountants

Internal
auditsCSR Committee
Risk Management
Committee
Executive Officers
Business Operations

Social Contribution
Committee

Fundamental Position Regarding Corporate GovernanceBusiness Execution, Audit/Supervision, Appointments,

JSR is dedicated to translating into actions its corporate phi-

Payroll Decisions and Other Matterslosophy: Materials Innovation — Supplying new materials andusing the value generated to help create a better world (for

1. Reasons for Adoption of the Current Governance Systempeople, society and the environment). JSR’s goal is to con-

JSR has adopted the corporate auditor system. The Board ofstantly generate corporate value by sustaining the efficiency,

Directors and the corporate auditors monitor and supervise

transparency and soundness of its operations, while function-business execution.

ing as an appealing company that earns the trust of and satisfies
all stakeholders.

The adoption of the executive officer system made it possible to improve the efficiency of decision making and business

JSR uses the executive officer system in order to expedite

execution, as well as to reinforce management supervisorydecision making and business execution, as well as to rein-functions. JSR has also appointed external auditors with a highforce management supervisory functions. JSR has secured

level of independence and expertise, and has improved theand improved the effectiveness of internal control, by strength-

reporting system so that important matters are reported to theening the cooperation between the Internal Audit Department,

corporate auditors or the Board of Auditors appropriately andwhich conducts internal audits, and the corporate auditors.

at the right time. These measures have reinforced auditing func-

Moreover, improving the reporting system enables important

tions and secured reasonableness, transparency and fairness

matters to be reported to the corporate auditors or the Boardin management judgments. In addition, in accordance with theof Auditors appropriately and at the right time. Furthermore,“Basic Policy to Establish a Sound Internal Control System,”

attorneys and certified public accountants are appointed as

JSR has worked to reinforce the monitoring and supervisory

external auditors in order to secure independence and thefunctions of management through various measures, such as

expertise of auditors to reinforce management supervisory

the establishment of the internal control system, including thefunctions. Through these various measures, JSR has worked

Internal Audit Department, which conducts internal audits,

to increase management efficiency and reinforce internal con-and strengthening the cooperation between the internal con-trol functions and management supervisory functions.

trol departments and the corporate auditors. Although there

JSR will continue to strengthen and expand corporate gov-

are no external directors, JSR believes that there has been aernance. By fully utilizing the current management system, JSR

well-functioning system for both aspects of securing rea-

intends to conduct business operations in a manner that is fair,sonableness, transparency and fairness in managementtransparent and speedy.

judgments, and the monitoring functions of management fromobjective and neutral standpoints.

22

JSR Corporation

Furthermore, transparency is enhanced through easy-to-

5. Board of Auditors

understand information disclosure in an appropriate and timely

With five members, including three external auditors, this board

manner, and through proactive relations with investors. The

meets every month as stipulated in the regulations governing

appointment of all directors and the approval of board mem-

this body. The corporate auditors receive reports on importantbers’ bonuses are conducted at the Annual General Meeting

matters, hold discussions and reach decisions.

of Shareholders. In addition to these efforts, by holding theIn accordance with standards for audits by corporate audi-

General Meeting of Shareholders and in sending notification

tors, the auditors attend meetings of the Board of Directors,of convening the Meeting at an early date, as well as through the

Executive Committee and other important committees to mon-participation in voting rights, JSR has striven to manage theitor how important decisions are reached and business activities

General Meeting of Shareholders in a manner that is easily

are executed. The auditors also receive reports from the inde-supervised and governed by shareholders.

pendent financial accountants, directors and others. Throughthese activities, the Board of Auditors hold discussions in order

2. Board of Directors

to form auditing opinions.

There are nine directors on the Board of Directors. They arecharged with discussing and reaching decisions concerning

6. CSR Committee

important items associated with the execution of business

The CSR Committee was established to ensure that JSR fulfills

operations. They are also charged with supervising the exe-

its responsibilities to society and complies with laws and reg-

cution of the directors’ function. As a rule, the directors holdulations. Under the CSR Committee, four committees weremonthly meetings that are chaired by JSR’s chairman. In addi-

established: the Corporate Ethics Committee, the Responsibletion, five corporate auditors, including three external auditors,

Care Committee, the Risk Management Committee and theattend meetings of the Board of Directors and state opinions as

Social Contribution Committee. The CSR Committee integrates

required.

and guides the activities of the above four committees andmeets four times each year along with special meetings as nec-

3. Executive Committee

essary to further strengthen the company’s CSR efforts.

The Executive Committee holds extensive discussions on items

The Committee is chaired by the executive managing direc-

concerning fundamental management initiatives, management

tor responsible for CSR, with an executive managing director,

policies, and management plans, along with important mat-three managing directors and two directors. Bureaus of theters concerning the execution of business activities at eachfour committees listed above also attend meetings of the CSR

department. The committee thus gives direction concerning

Committee. The Committee clarifies the company’s stancethese issues. As required, certain items submitted to this com-

toward CSR and works to strengthen CSR efforts at JSR.

mittee are passed on to the Board of Directors for further
discussion.

7. Corporate Ethics Committee

This committee is made up of all the directors, and responds

The Corporate Ethics Committee chaired by the managing

to important business execution with the aim to expedite deci-director for general affairs was established under the CSRsion making and improve the efficiency of such operations. As

Committee to implement corporate ethics standards and pre-a rule, this committee meets every Monday except the thirdvent improper actions throughout the JSR Group. The JSR

Monday of the month, and is chaired by the president. The fullGroup Principles of Corporate Ethics have been prepared totime corporate auditors also attend these committee meet-provide a code of conduct for executives and employees. The

ings, where they discuss and report various items.

committee oversees corporate ethics throughout the Group
as well as provides guidance regarding specific items.

4. Officers Committee

As for the reporting system, along with the internal hotline

This committee is held in order to hear reports from all depart-linked to the Corporate Ethics Committee and the external hot-ments concerning the execution of business activities, to ensureline linked to an external attorney, JSR introduced a new hotline

members’ thorough understanding of important business mat-in September 2008 which is linked to a specialized externalters and to enhance their communications. This committee

agency, also available in English and Chinese.

consists of all the directors, senior officers, officers and full time
corporate auditors, except overseas representatives. As a rule,

8. Responsible Care Committee

this committee meets every third Monday of the month and is

JSR conducts a Responsible Care program to fulfill its obliga-

chaired by the president.

tions to achieve sustainable development. The Responsible
Care Committee was established under the CSR Committee

ANNUAL REPORT 201023

to ensure that Responsible Care activities are conducted effec-

JSR Group. These auditors are staffed by one individual.

tively across the entire company. The committee is chaired byAudits are performed as described in item 5 concerning thethe director for safety environmental affairs, demonstrating

Board of Auditors.

Responsible Care’s position as a core component of JSR’s
management.

The corporate auditors work closely with the independent
financial accountant. The corporate auditors receive reports

This committee approves Responsible Care plans, evalu-

on the financial accountant’s audit plan and audit results.

ates and verifies results of activities, and helps to maintain and

Furthermore, the corporate auditors and financial accountants

upgrade JSR’s programs to eliminate accidents, reduce envi-

exchange information and opinions as necessary in the courseronmental impact and handle chemicals responsibly. Detailsof each fiscal year.

and results of Responsible Care activities are disclosed throughThe internal audit has been conducted by the Internal Audit

Responsible Care reports prepared by individual plants as wellDepartment as a specialized internal auditing unit. The corpo-

as for the company as a whole. These reports are audited byrate auditors receive reports on the audit plan and audit results

third parties to improve the reliability and transparency of thefrom the Internal Audit Department regularly, exchange opin-

data. Through these activities, the committee is dedicated toions, and enhance the auditing system.

earning greater trust from customers and preventing any concerns among residents in the neighborhoods of JSR’s facilities.
Since fiscal 2007, JSR has elevated the position of its

Actions during Fiscal 2010 to Improve
Corporate Governance

CSR report by revamping it to include more information on• As for corporate ethics activities, in fiscal 2010, JSR held

CSR activities, based on JSR’s fundamental stance regard-

ethics training for executives conducted by external experts

ing the three core elements of CSR: the economy, the(August 2009). The contents of the training were then sharedenvironment and the community. To make the information

with domestic managers of JSR and group companies.

widely available, these reports are posted on the JSR web-Through this, the company has worked to raise people’s indi-site (http://www.jsr.co.jp/jsr_e/csr/index.shtml).

vidual awareness of ethics. In addition, to get a firm grasp of
the status of corporate ethics at JSR and each Group com-

9. Risk Management Committeepany, the company held a corporate ethics awareness survey

In the event of a large crisis, JSR considers actions to limit

for all employees (October–November 2009). This was thethe impact on operations to be a critical management task.

fourth survey, following on from the previous survey, which was

In this light, the company established the Risk Management

conducted in 2007.

Committee under the CSR Committee with the executive managing director responsible for CSR as committee chair. The• A risk management drill was conducted by the JSR head

Committee decides policies and plans in response to crises,

office and plants to strengthen the risk management frame-

both present and potential, and promotes crisis management

work. This drill confirmed that JSR can appropriately respondtraining that simulates the occurrence of large scale disasters.

to an accident, fire or damage from a natural disaster at a plant.
Drills cover the head office Disaster Response Headquarters,

10. Social Contribution Committee

plant disaster response departments, corporate communica-

To examine and promote social contribution activities that befit

tions units and other components of the JSR organization

JSR, the Social Contribution Committee was established under(December 2009).

the CSR Committee with the executive managing director

JSR also identified and evaluated the potential risks,

responsible for CSR as committee chair. JSR has been involved

and formulated countermeasures against the risks forin many activities that contribute to society at the local level.

all domestic departments, including Group companies

JSR will expand its activities to cover the whole society and(September–October 2009).

provide more active approaches. In fiscal 2010, new programs
were started, such as “Table for Two”, the “ecocap” campaign,• JSR conducts environmental and safety audits on a regularforeign coin fund-raising, and the permitting of teaching staff

basis. In fiscal 2010, audits were conducted at 14 establish-

to attend training sessions during the summer.

ments of ten domestic group companies. To strengthen
compliance efforts, JSR has verified and improved the status

11. Status of Internal Audits, Audits by Corporate Auditors
and Financial Audits

24

of compliance at the whole group, including overseas locations since fiscal 2008. In fiscal 2010, such verification and

JSR has adopted the corporate auditor system. There are cur-improvement were conducted at 19 domestic companies andrently five corporate auditors, including three from outside the

14 overseas companies from April to September.

JSR Corporation

Directors, Corporate Auditors, and Executive Officers
As of June 18, 2010

Kenji Ito

Nobuko Kato
Yoshio Tamaki

Hozumi Sato

Kouichi Kawasaki

Seiichi Hasegawa

Yasuki Sajima

Masaki Hirose

Mitsunobu Koshiba

Nobuo Bessho

Hisao Hasegawa

Yoshinori Yoshida

Hiroichi Uekusa

Tsugio Haruki

Directors and Corporate Auditors
Yoshinori Yoshida

Seiichi Hasegawa

Yasuki Sajima

Yoshio Tamaki

Representative Director andChairman

Executive Managing Director,
Procurement, Logistics,
Information Technology

Managing Director, Fine Chemicals
SectorCorporate Auditor (Full-time)

Mitsunobu Koshiba
Representative Director andPresident

Tsugio Haruki
Executive Managing Director,
Accounting and Finance, Corporate
Communications, CSR

Nobuo Bessho
Kouichi Kawasaki

Masaki Hirose
Managing Director, Corporate
Planning, Group Companies
Coordination, Human Resources,
General Affairs, Legal

Director and Senior Officer,
Petrochemicals Sector (including
Plastics), Safety Environmental
Affairs

Corporate Auditor (Full-time)

Kenji Ito
Corporate Auditor

Hiroichi Uekusa

Hisao Hasegawa

Corporate Auditor

Managing Director, Research &Development, Strategic BusinessDirector and Senior Officer,
Manufacturing and Technology,
Product Safety & Quality Assurance

Nobuko Kato

Atsushi Kumano

Takashi Wakabayashi

Takeshi Sugimoto

Hayato Hirano

Senior Officer, General Manager ofResearch & Development

Officer, General Manager ofBusiness Planning Department,
Fine Chemicals

Officer, General Manager ofElectronic Materials Division

Officer, General Manager ofFinance Department

Tsuyoshi Watanabe

Katsuya Inoue

Officer, General Manager of
Yokkaichi Research Center

Officer, General Manager ofCorporate Planning Department

Hozumi Sato

Corporate Auditor

Officers

Shin-ichiro Iwanaga
Senior Officer, General Manager of
Tsukuba Research Laboratories

Nobuo Kawahashi
Officer, President of JSR
Micro Korea Co., Ltd.

Yasuhisa Nagahiro
Senior Officer, Yokkaichi Plant
Manager

Takatoshi Nagatomo
Officer, Deputy General Manager ofPetrochemical Products Division

ANNUAL REPORT 201025

Company Network

1

B

A

12
14

13
9

15

8

3

JSR (Japan)

6

5

2

10
C
11 7

4
D

HEAD OFFICEJSR Corporation
1-9-2, Higashi-Shinbashi,
Minato-ku, Tokyo
105-8640, Japan

BRANCH OFFICES
Nagoya Branch
A Wallisellen Branch
B Shanghai Office
C Taiwan Office
D Singapore Office

PLANTS
Yokkaichi Plant
100 Kawajiri-cho
Yokkaichi, Mie
510-8552, Japan

Chiba Plant
5, Chigusakaigan,
Ichihara, Chiba
229-0108, Japan★ Styron Europe GmbHKashima Plant
34-1, Tohwada,
Kamisu, Ibaraki
314-0102, Japan(formerly Dow EuropeGmbH)
Schkopau, Germany* A production plant ofsynthetic rubbers where JSR
owns a capacity right of
30,000 tons/year.

JAPAN
Fine Chemicals Business
JSR MICROTECH INC.
Production and sales of printed circuit boards
and IC testing fixtures.

D-MEC LTD.
Commissioned generation of 3D models,sales of solid modeling systems and optically-hardened resins, and commissioned
analysis by CAE.

JSR Micro Kyushu Co., Ltd.
Production of photoresists for semiconductors and materials for flat panel displays.

JSR Optech Tsukuba Co., Ltd.
Production of UV curing type optical fiber
coating materials.

JAPAN FINE COATINGS Co.,
Ltd.(*)JM Energy Corporation
Design, development, product and sales oflithium-ion capacitors.

Tri Chemical Laboratories, Inc.(*)

Production and sales of precursors for semiconductors, optical fibers and compound
semiconductor and others.

Elastomers Business
Kyushu Gomu Kako Co., Ltd.
Compounding of crude rubbers and sales ofcompounded products.

ELASTOMIX CO., LTD.
Compounding of crude rubbers and sales ofcompounded products.

Japan Butyl Co., Ltd.(*)

Production and sales of butyl rubbers.

Emulsions Business
Emulsion Technology Co., Ltd.
Compounding and sales of crude latex.

Plastics BusinessJAPAN COLORING CO., LTD.
Coloring of synthetic resin and sales of colored products.

Techno Polymer Co., Ltd.
Production, sales and R&D of ABS resin.

Business in Other Fields
JSR Trading CO., LTD.

JSR ENGINEERING CO., LTD.
Engineering and consultation for chemicalengineering equipment.

JSR Business Service Co., Ltd.
Non-life insurance agency, purchase, sales
and leasing of real estate, undertaking offinancing, payroll accounting calculation.
Development and sales of computer software and hardware.

Nichigo Kogyo Co., Ltd.
Product packaging, undertaking of civil engineering & general construction.

Exports and imports, purchase and sales ofthe following: various chemicals, machinery,equipment, physical distribution materials,
living necessities, foodstuffs, beverages,
real estate.

KRATON JSR ELASTOMERS
K.K.(*)JSR LOGISTICS CO., LTD.

Fine Chemicals Business
1 JSR Micro N.V.

Elastomers Business
5 JSR AMERICA, INC.

9

Development, production and sales ofsemiconductor materials.

Sales of synthetic rubbers.

Compounding of crude rubbers and salesof compounded products.

Sales and technical services of synthetic
resins in China.

13 TECHNO POLYMER AMERI-

ELASTOMIX (THAILAND)
CO., LTD.

Plastics Business
10 TECHNO POLYMER HONG
KONG CO., LTD.

Compounding of crude rubbers and sales ofcompounded products.

Sales and technical services of synthetic resinsin Hong Kong and neighboring regions.

Sales of coating materials for fiber-optic
cables reinforced by ultraviolet or electron
radiation and for other apparatus.

Production, purchase, and sales of thermoplastic rubbers.

Freight forwarding, warehousing, delivery
management.

OVERSEAS

2JSR Micro, Inc.

Development, production and sales ofsemiconductor materials.

3

JSR Micro Korea Co., Ltd.

Development, production and sales ofmaterials for flat panel displays andothers.

4

JSR Micro Taiwan Co., Ltd.

Development, production and sales ofmaterials for flat panel displays.

6

Kumho Polychem Co., Ltd.(*)

Production and sales of EPRs.

7

8

ELASTOMIX (FOSHAN) CO.,LTD.

Compounding of crude rubbers and sales ofcompounded products.

Tianjin Kuo Cheng Rubber
Industry Co., Ltd.(*)

11 Techno Polymer (Thailand)Co., Ltd.
Sales and technical services of synthetic
resins in ASEAN region.

12 Techno Polymer (Shanghai)Co., Ltd.

CA, INC.
Sales of plastics, technical services related
to plastics in North America.

14 Shanghai Rainbow Color

Plastics Co., Ltd.
Coloring of synthetic resins and sales of colored products.

15 JSR (Shanghai) Co., Ltd.
Sales and marketing of JSR products.

( ) Equity method affiliate*

26

JSR Corporation

Financial Section
28

Management’s Discussion and Analysis

32

Consolidated Balance Sheets

34

Consolidated Statements of Income

35

Consolidated Statements of Changes in Net Assets

36

Consolidated Statements of Cash Flows37

Notes to Consolidated Financial Statements

50

Independent Auditors’ Report

For the purpose of this Annual Report, JSR’s accounting period (fiscal year) is defined as the period from April 1 to March 31 of the following year.
When noted “fiscal 2010,” this indicates the period from April 1, 2009 to March 31, 2010.

ANNUAL REPORT 201027

Management’s Discussion and Analysis(April 1, 2009 to March 31, 2010)

Business Results Analysis
Business Results for Fiscal 2010
Japan’s economy in fiscal 2010 (April 1, 2009 to March 31,2010) bottomed out at the end of fiscal 2009, and since thenslowly headed towards recovery. This was due to the recovery in exports to improving economies in Asia, especially China,
as well as the additional effects of economic policies andincreased production due to progress in inventory adjustments.
However, there are concerns arising from the continuing low
level of capital investment due to factors such as large supply/demand gaps, and the continuing harsh employment andincome environments. Conditions were still harsh comparedto the level before the global economic crisis.
In our demand industries, domestic and foreign economic
stimulus packages led to demand in Liquid Crystal Display(LCD) TVs exceeding the previous fiscal year, and productionof flat panel displays was robust. However, while productionof automobiles, automotive tires and semiconductors recovered to year-on-year growth in the second half of the year,
whole year production remained below the previous year’slevel. Looking at raw materials, there was a large drop in thenaphtha price at the end of the previous fiscal year, but theprice rebounded at the beginning of fiscal 2010. In addition,
prices rose for utilities and major petrochemical raw materials
such as styrene monomer and acrylonitrile, putting negative
impact on earnings.
Under these challenging circumstances, JSR put effort into
its core businesses, which consist of the petrochemicals andfine chemicals businesses, by streamlining business cost structure to accommodate an appropriate sales size to maintain areasonable level of profit, in addition to improving global competitiveness by strengthening JSR’s presence in growing
markets by technological advantage.
In terms of streamlining business cost structure, JSR continued to execute the Cost-Reduction Plan “E-100 Projects”
across all group companies, and made additional efforts to
Net Sales /Net Income(Billions of Yen)

reduce fixed costs, resulting in exceeding the initial plan andsecuring earnings.
In order to improve global competitiveness for the petrochemicals business, the company expanded export sales
focusing on emerging countries, especially China with technically differentiated products. In addition, prices of someproducts were revised in response to rising prices of major raw
materials. In the fine chemicals business, further growth ofsales in our leading-edge materials, as well as incorporating
demand in newly-emerging nations were targeted. However,amidst the global economy still unrecovered to its previous
level, decreased demand impacted on our results.
As a result, sales and profit were down in fiscal 2010, consolidated net sales decreased 12% year-on-year to ¥310.2
billion, operating income was down 33.3% to ¥20.2 billion, current income decreased 28.1% to ¥22.4 billion, and current net
income decreased 2.4% to ¥13.6 billion.
Results by Business Segment
Elastomers Segment
With regard to domestic sales of synthetic rubbers, althoughdemand for general-purpose rubbers such as styrenebutadiene rubbers (SBR) and polybutadiene rubbers (BR) for
automotive tires showed signs of recovery; overall demandremained low. This resulted in a substantial decline in net
sales year-on-year. For high-performance special-purpose
rubbers, such as acrylonitrile-butadiene rubbers (NBR) andethylene-propylene rubbers (EPR), although sales volume
in the second half increased year-on-year as a result ofrecovery in automobile production due to the effects oftax reductions for environmentally-friendly vehicles andother measures, sales volume during the whole fiscal year
remained low, and net sales decreased year-on-year. In
focusing on exports of general-purpose synthetic rubbers,
as a result of sales expansion to Asian countries such as
China, which has shown a high growth rate of automobile

Operating Income /Operating Margin(Billions of Yen)

(Billions of Yen)

500

50

400

40

300

Total Assets /
ROA
16

60

12

40

8

30

200

20

100

10

20

0

0

FY’06 FY’07 FY’08 FY’09 FY’10

28(Billions of Yen)

(%)

80

15

400

12

300

9

200

6

100

3

4

0

0

FY’06 FY’07 FY’08 FY’09 FY’10

00

FY’06 FY’07 FY’08 FY’09 FY’10

Net Sales [Left]

Operating Income [Left]

Total Assets [Left]

Net Income [Right]

Operating Margin [Right]

ROA [Right]

JSR Corporation

(%)

500

production; net sales grew substantially year-on-year.
For TPEs, such as butadiene and styrene-butadiene thermoplastic elastomers, sales were low during the first half of the fiscal
year. In the second half, along with recovering sales of TPEs forautomobile use, foreign demand mainly in TPEs use for shoesoles in Europe, Central and South America became robust. As
a result, net sales were the same as in the previous year.
For earnings, cost reduction efforts and price revision efforts
in response to higher raw materials prices were made. Althoughearnings improved due to recovering demand, a large drop in
demand, especially in the first half, as well as inevitable production adjustments resulted in the decline of profit margins
which led to an operating deficit.
As a result, consolidated net sales in the elastomers segment declined 11.2% year-on-year to ¥104.6 billion, with
operating loss decreasing by ¥8.5 billion year-on-year, leading to a deficit of ¥0.5 billion.
Emulsions Segment
Paper coating latex (PCL), the main product of the segment,
faced a decreased production of coated paper. Generalindustrial latex saw higher export sales, mainly to China andTaiwan. Nevertheless, low demand in areas related to domestic construction and automobiles led to consolidated net sales
in the emulsions segment declining 27.5% year-on-year to¥17.0 billion.
For earnings, cost reduction efforts and price revision efforts
in response to higher raw material prices were made. Despite
these efforts, demand dropped substantially, and operating
income decreased 46.2% year-on-year to ¥0.3 billion.
Plastics Segment
An improving trend is seen for automobile sales both in Japanand overseas, but the sales volume for the whole fiscal year
fell year-on-year, with low sales across demand industries due
to factors including low demand in the building materials andShareholders’ Equity /ROE(Billions of Yen)entertainment sectors. Consolidated net sales of the plastics
segment decreased 25.9% year-on-year to ¥48.0 billion. For
earnings, cost reduction efforts and price revision efforts in
response to higher raw material prices were made. Despite
these efforts, the substantial drop in demand, as well as theimpact of the appreciation of the yen, did not make up for the
decline in profit margins, leading to an operating deficit.
Operating loss decreased by ¥1.3 billion year-on-year and led
to a deficit of ¥3 million.
Fine Chemicals and Other Products Segment
In the semiconductor materials division, demand for semiconductors was seeing clear recovery in Japan, Asia and the U.S.,
mainly in laptop PCs and smartphones. This led to a recovery
of sales in argon fluoride (ArF) photoresists, multilayer materials, and chemical mechanical planarization (CMP) materials.
However, sales during the whole year did not reach the levelsof the previous year, resulting in lower net sales year-on-year.
In the FPD materials division, although a declining trend isseen in LCD panel prices, domestic and foreign economic stimulus packages boosted LCD TV market demand above that ofthe previous year, and the release of a new operating system
also created firm laptop PC demand, resulting in higher net
sales year-on-year.
Sales of optical fiber coating materials, the mainstream product of the optical materials division, were steady overall. Despite
weak domestic demand of optical fiber cables, there was strong
export demand for optical fibers with large growth to China andother emerging markets. Anti-reflective coating materials andprotective coating materials were increasingly adopted by thehigh value-added sector paralleling the trend in flat screen TVs
becoming more high-definition. ARTON® resin (heat-resistanttransparent resin) saw more intense competition in the opticalfilm sector, but was steady in resin sales and the precision processing sector. For optical materials as a whole, net sales
increased year-on-year.
Shareholder Return /Dividend Payout Ratio

R&D Expenses /Capital Expenditures(%)(Billions of Yen)

(Billions of Yen)

(%)

300

18

30

18

60

200

12

20

12

40

100

6

10

6

20

0

0

0

FY’06 FY’07 FY’08 FY’09 FY’10

0

FY’06 FY’07 FY’08 FY’09 FY’10

Shareholders’ Equity [Left]

R&D Expenses

ROE [Right]

Capital Expenditure0

FY’06 FY’07 FY’08 FY’09 FY’10 FY’11(Plan)

Dividend(Yen･Share)

20

24

32

32

26

32

Dividend [Left]
Share Buyback [Left]
Dividend Payout Ratio [Right]

ANNUAL REPORT 201029

Sectors where large future growth is expected are positioned
as “strategic businesses”: precision materials and processing,
medical materials, as well as environment and energy. Our
strategic businesses are producing solid results. For example,
in the current fiscal year, JSR launched a new series of highluminance LED related materials under the name of LUMILON™,
such as encapsulants, highly refractive coatings and insulationmaterials. JSR also began selling samples of touch panel
sheets/films for mobile terminals and touch panel PCs, andthere is growing domestic and foreign adoption of binder materials for lithium-ion batteries.
For earnings, cost reduction efforts were also made. Despite
these efforts, profits were the same as in the previous year
due to weak demand, the appreciation of the yen, and higher costs in the strategic businesses which receive strategic
allocation of resources.
As a result, consolidated net sales in the fine chemicals andother products segment declined 4.0% year-on-year to ¥140.5
billion, with operating income declining 0.2% year-on-year to¥20.5 billion.
Analysis of Assets, Liabilities and Net Assets
Total assets at the end of fiscal 2010 increased by ¥34.1 billion
compared with the end of fiscal 2009, to ¥373.6 billion.
The main changes in current assets compared to the end of
fiscal 2009 were: cash and deposits increased ¥19.8 billion,
marketable securities increased ¥12.5 billion, notes andaccounts receivable-trade increased ¥20.4 billion, and inventories decreased ¥18.8 billion. In the second half of fiscal 2009,
the economic crisis resulted in decreased sales and inventory buildup, but sales rebounded from a bottom in the fourth
quarter due to demand recovery and active sales growth in fiscal 2010. This led to decrease in inventories, while notes andaccounts receivable-trade and cash on hand increased.
The main changes in fixed assets compared to the end of
fiscal 2009 were: machinery, equipment and vehicles decreased¥3.4 billion, other tangible fixed assets decreased ¥3.5 billion,
and investment securities increased ¥4.6 billion. Tangible fixed
assets decreased as JSR held down capital investment, butinvestment securities increased due to a rise in the value of
securities held.
Major capital expenditures by the JSR Group during fiscal
2010 included a new production facility of advanced lithography materials and expansion of production capacity of advanced
LCD materials (JSR Micro Kyushu, Co., Ltd.). Total capital
expenditures were approximately ¥17.7 billion.
The main changes in liabilities compared to the end of fiscal
2009 were: notes and accounts payable-trade increased ¥20.0
billion, and accrued income taxes increased ¥4.9 billion. Notes
and accounts payable-trade increased due to increased production and higher raw material prices.
Net assets were ¥250.7 billion. This was comprised of ¥250.2
billion shareholders’ equity, negative ¥0.7 billion valuation and30

JSR Corporationtranslation adjustments, ¥0.4 billion subscription rights toshares, and ¥0.8 billion minority interests. The main changes
compared to the end of fiscal 2009 were: a ¥5.3 billion increase
in retained earnings, and unrealized gains on securities
increased ¥3.0 billion. Total net assets increased ¥8.7 billion.
Cash Flow Analysis
Consolidated basis cash and cash equivalents (hereafter,“cash”) as of the end of fiscal 2010 increased by ¥24.3 billion
over the end of fiscal 2009, to ¥61.4 billion.
Cash Flows from Operating Activities
Fiscal 2010 operating cash flows increased 72.9% year-onyear to ¥58.7 billion.
The main adjustments to reconcile net income before income
taxes and minority interests were: ¥22.4 billion depreciation
and amortization (¥24.8 billion in fiscal 2009), ¥20.5 billion
increase in notes and accounts receivable-trade (¥30.2 billion
decrease in fiscal 2009), ¥19.5 billion decrease in inventories(¥7.1 billion increase in fiscal 2009), and ¥18.9 billion increasein notes and accounts payable-trade (¥38.0 billion decreasein fiscal 2009).
Fiscal 2010 cash flows from operating activities increasedby ¥24.7 billion over the previous period, mainly due todecreased inventories and income tax payments.
Cash Flows from Investing Activities
Investing cash flows in fiscal 2010 were a negative ¥27.3 billion (down 25.0% from fiscal 2009). The main components
were ¥19.0 billion (¥22.7 billion in fiscal 2009) due to paymentsfor purchase of fixed assets, and ¥6.0 billion due to paymentsfor purchase of securities.
Net cash used in investing activities decreased by ¥9.1
billion compared to fiscal 2009, mainly due to the elimination of payments for purchase of investment of subsidiaries
and affiliates.
Risks
The JSR Group is exposed to the following risks that may impact
on operating results, financial position, cash flows and otheraspects of performance. Forward-looking statements in this discussion are based on JSR’s judgments as of March 31, 2010.
Risks at JSR include, but are not limited to, the following items:(1) Changes in Demand due to Economic Trends
In the major industries where the JSR Group’s products are
sold such as automobiles and electronics, demand is influenced by the economic climate in a country or region. An
economic slowdown could reduce demand in an industry andadversely affect the JSR Group’s operating results.
(2) Higher Prices for Crude Oil, Naphtha andOther Major Raw Materials
Higher prices for crude oil and naphtha, or changes in the mar-kets for JSR’s major raw materials, could raise prices of raw
materials and adversely affect the JSR Group’s operating
results, especially in the petrochemicals sector of elastomers,
emulsions and plastics.
(3) Fluctuation in Exchange Rates
As the JSR Group undertakes product exports in foreign currencies and imports goods such as raw materials, theCompany takes measures to reduce risks such as entering
into forward exchange contracts; however, fluctuation in
exchange rates could give rise to adverse outcomes. In addition, operating results of consolidated subsidiaries and equity
method affiliates located overseas are converted into Japanese
yen amounts for the purposes of preparing the consolidated
financial statements. However, due to the yen’s appreciation,
the JSR Group’s business results could be adversely affected.
(4) Procurement of Raw Materials
The JSR Group works to ensure a stable supply of raw materials by procuring materials from a number of sources. However,an interruption to the supply of raw materials due to an accident, bankruptcy or quality problem at a supplier could
adversely affect production activities and the JSR Group’s
operating results.
(5) Development of New Products
Rapid technological progress is constantly taking place in theelectronics industry, which is the primary source of demand
for semiconductor manufacturing materials, FPD materials andoptical materials, the major products of the JSR Group’s finechemicals and other products business. JSR is constantly
working on developing state-of-the-art materials in line withthis progress. However, unforeseen changes in the industry ormarket could prevent the timely development of new products
and adversely affect the JSR Group’s operating results.
(6) R&D Involving Next-Stage Growth Businesses
The JSR Group makes substantial investments in R&D to create next-stage growth businesses. However, there is no
guarantee that these R&D activities will always yield worthwhile
results. Depending on R&D results, there could be an adverse
effect on the JSR Group’s operating results.
(7) Protection of Intellectual Property
Protection of intellectual property is extremely important for the
JSR Group’s business activities. JSR has established a system for protecting its intellectual property and takes various
actions as required. However, a dispute about intellectual property with another company or an infringement on JSR’s
intellectual property by another company could adversely affect
the JSR Group’s operating results.
(8) Product Quality Assurance and Product Liability
The JSR Group has a product quality assurance system andproduct liability insurance. However, damage or injury caused
by a product manufactured by the JSR Group could adversely affect the JSR Group’s operating results.
(9) Natural Disasters and Accidents
To minimize the negative effect on its business activities of any

disruption to manufacturing activities, all JSR Group manufacturing facilities have established countermeasures based on theidentification of all potential sources of a crisis and conducts
periodic inspections of facilities. The group also works constantly on safety measures with regard to earthquakes and othernatural disasters. However, a major natural disaster or accident
that damages a production facility or disrupts manufacturing
could adversely affect the JSR Group’s operating results.
(10) Environmental Issues
Positioning environmental protection as an important elementof its operations, the JSR Group complies with all laws andregulations concerning the environment. The group also takes
actions aimed at reducing its environmental impact, loweringand eliminating waste materials, and cutting energy andresource consumption. The group has taken many actions toprevent the external release of all types of chemicals.
However, in the event that a spill occurs or that environmental regulations become stricter, the group’s businessactivities could be restricted, the group may have to pay compensation and other expenses, or the group may have to makesubstantial capital expenditures. Any of these events could
adversely affect the JSR Group’s operating results.
(11) Overseas Operations
The JSR Group is aggressively expanding operations on a global scale, conducting manufacturing, sales and other activities
in countries and regions in the United States, Europe, Asia andother parts of the world. Overseas operations are exposed toa number of risks that include, but are not limited to, an unfavorable political environment or economic trends; labor disputes
and other problems due to differences in labor laws and otherworking conditions; difficulty in recruiting and retaining employees; an adverse impact on business activities due to an
inadequate social infrastructure; and the impact of wars, terrorism and other social instability. Any of these events could
adversely affect the JSR Group’s operating results.
(12) Laws and Regulations
In the countries where it operates, the JSR Group is subject tovarious laws and regulations involving business and investment
permits, export and import activities, trade, labor relations,
intellectual property, taxes, foreign exchange and other items.
The group has established a clear compliance policy in order toensure strict observance of laws and regulations as well as ethical standards. In the event that a law or regulation is violated,or a law or regulation becomes stricter or is significantly altered,
there could be limitations to the group’s business activities oradditional compliance costs. Any of these events could
adversely affect the JSR Group’s operating results.
(13) Litigation
In conjunction with its business activities in Japan and overseas, the JSR Group may be sued or be involved in otherlitigation concerning a dispute with a supplier, customer orother external party. The outcome of significant litigation could
adversely affect the JSR Group’s operating results.

ANNUAL REPORT 201031

Consolidated Balance Sheets
JSR Corporation
March 31, 2009 and 2010

Thousands of
U.S. dollars(Note 1)Millions of yen

ASSETS

2009

2010

2010

Current assets:
Cash (Note 3)¥

16,910¥36,677$394,204

Notes and accounts receivable — trade (Note 4)

52,782

73,133786,035

Short-term investment securities (Notes 3 and 5)

21,492

34,000365,434

Inventories

76,955

58,130624,786

Deferred tax assets (Note 8)

3,108

4,291

46,118Other current assets (Notes 8 and 12)

19,21623,340250,862

Total current assets

190,463229,5712,467,439

Buildings and structures

29,29030,654329,467

Machinery, equipment and vehicles

32,591

29,201

313,856

Land

16,87019,435

208,890

Construction in progress

4,097

3,855

41,433

Other tangible assets

8,629

5,176

55,63891,47788,321

949,284

6,723

5,883

63,234

Investment securities (Note 5)

24,15928,735308,844

Longterm loans receivable

4,928

2,635

28,316

Property, plant and equipment (Notes 6 and 9):

Intangible assets
Investments and other non-current assets:

Deferred tax assets (Note 8)

8,703

6,299

67,707

Other assets (Notes 4 and 12)

13,045

12,122130,284

50,835¥
See accompanying notes.

32

JSR Corporation

339,498¥

49,791

535,151

373,566$ 4,015,108

Thousands of
U.S. dollars(Note 1)Millions of yen

LIABILITIES AND NET ASSETS
Current liabilities:
Notes and accounts payable — trade
Short-term loans payable and current portion of long-term debt (Note 6)
Income tax payable (Note 8)
Other current liabilities (Notes 8 and 12)
Total current liabilities

2009¥

Long-term liabilities:
Employees retirement benefits (Note 7)
Allowance for environmental expenses
Other long-term liabilities (Notes 6, 8 and 12)
Total long-term liabilities

39,636
14,340971
21,22376,170

2010

2010
¥

59,653
14,161
5,837
21,100100,751$

641,157
152,20762,733
226,781
1,082,878

14,821
3,205
3,316
21,342

15,903
3,184
3,027
22,114

170,931
34,22232,528
237,681

23,32025,179218,515

23,32025,179223,891

250,647
270,630
2,406,394(22,217)(22,219)(238,818)

645(4,546)311
779
241,986
339,498

3,610(4,341)427
834
250,701
373,566

38,802(46,657)
4,589
8,962
2,694,549$ 4,015,108

Contingent liabilities (Note 14)
Net assets (Note 10)
Shareholders’ equity
Common stock:
Authorized — 696,061,000 shares
Issued— 255,885,166 shares in 2009 and 2010
Capital surplus
Retained earnings
Less treasury stock, at cost
11,648,666 shares in 2009 and 11,650,235 shares in 2010
Valuation and translation adjustments
Unrealized gains on securities, net of taxes
Foreign currency translation adjustments
Subscription rights to shares (Note 11)
Minority interests
Total net assets¥¥

ANNUAL REPORT 201033

Consolidated Statements of Income
JSR Corporation
Years ended March 31, 2008, 2009 and 2010

Thousands of
U.S. dollars(Note 1)Millions of yen

Net sales (Note 16)
Costs and expenses (Notes 15 and 16):
Cost of sales
Selling, general and administrative expenses¥

Operating income (Note 16)
Other income (expenses):
Interest and dividend income
Interest expenses
Loss on disposal of inventories
Gain (loss) on sale and disposal of property, plant and equipment
Foreign exchange gains (losses)
Equity in earnings of affiliated companies
Gain on sales of investment securities
Depreciation expenses of idle assets
Impairment loss of fixed assets (Note 9)
Loss on devaluation of investment securities
Loss on devaluation of inventories
Restructuring (Note 9)
Other — net

Income before income taxes and minority interests
Income taxes (Note 8):
Current
Deferred

Minority interests in net income of consolidated subsidiaries
Net income¥

2008
406,968¥2009
352,503¥2010
310,1842010$ 3,333,874

284,43162,527
346,958
60,010263,018
59,137322,155
30,348235,479
54,475289,954
20,2302,530,941
585,497
3,116,438
217,436

1,309
(256)
(1,799)(1,574)(2,036)
1,249
377
(740)
—
—
—
—
(1,673)(5,143)54,867

1,230
(271)
—
399
(993)
1,150
—
(1,091)(6,042)(1,887)(1,686)—(354)(9,545)20,803568(172)(1,728)
—
962
1,764
—
(750)
—
—
—
(1,191)(225)(772)
19,4586,104(1,852)(18,574)—
10,342
18,965—(8,057)———(12,804)(2,425)(8,301)
209,135

18,112(776)
17,33637,531

6,217
(76)
6,141
14,662

6,643
(882)
5,761
13,697

71,399(9,480)61,919147,216(537)
36,994¥(681)
13,981¥(52)
13,6452008

See accompanying notes.

34

JSR Corporation¥

147.26147.19
32.00

2009
¥

56.36
56.31
32.00

(560)
146,656

U.S. dollars(Note 1)Yen

Per share of common stock:
Net income
Diluted net income
Cash dividends applicable to the year

$

2010
¥

55.87
55.81
26.00

2010
$

0.60
0.60
0.28

Consolidated Statements of Changes in Net Assets
JSR Corporation
Years ended March 31, 2008, 2009 and 2010

Millions of yen
Number ofshares ofcommon stock(thousands)

Balance at March 31, 2007
Net income
Increase of treasury stock
Disposal of treasury stock
Cash dividends paid
Decrease resulting from increasein consolidated subsidiaries
Increase resulting from increase inaffiliated companies byequity method
Net changes other thanshareholders’ equity
Balance at March 31, 2008
Net income
Increase of treasury stock
Disposal of treasury stock
Cash dividends paid
Net changes other thanshareholders’ equity
Balance at March 31, 2009
Net income
Increase of treasury stock
Disposal of treasury stock
Cash dividends paid
Decrease resulting from increasein consolidated subsidiaries
Net changes other thanshareholders’ equity
Balance at March 31, 2010

255,885

Commonstock¥

23,320 ¥CapitalsurplusRetainedearnings

Treasury stock
at costUnrealized
gains onsecurities,
net of taxes

Foreigncurrencytranslation
adjustments

Subscription
rightsto shares

Minority
interests(8,300) ¥10,087 ¥1,526 ¥

70 ¥

4,730

—

—

—

36,994

—

—

—

—

—

—

—

—

—

(5,328)

—

—

—

—

—

—

—

(5)

5

—

—

—

—

—

—

—

(7,044)

—

—

—

—

—

—

—

—

(1,048)

—

—

—

—

—

—

—

—

232

—

—

—

—

—

25,179 ¥ 183,374 ¥

—

—

—

—

—

(5,280)(1,173)124

200

255,885

23,32025,179212,503(13,623)

4,807

353

194

4,930

—

—

—

13,981

—

—

—

—

—

—

—

—

—

(8,611)

—

—

—

—

—

—

—

(10)

17

—

—

—

—

—

—

—

(7,959)

—

—

—

—

—

—

—

—

(4,162)—
255,885—¥

23,320 ¥25,179 ¥ 218,515 ¥(4,899)117(4,151)(22,217) ¥645 ¥(4,546) ¥

311 ¥

779

—

—

—

13,645

—

—

—

—

—

—

—

—

—

(2)

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

(7,083)

—

—

—

—

—

—

—

—

(1,186)

—

—

—

—

—

—

—

—
255,885—¥

23,320 ¥25,179 ¥ 223,891 ¥

—

2,965

205

116

55

(22,219) ¥3,610 ¥

(4,341) ¥

427 ¥

834

Thousands of U.S. dollars (Note 1)

Balance at March 31, 2009
Net income
Increase of treasury stock
Disposal of treasury stock
Cash dividends paid
Decrease resulting from increasein consolidated subsidiaries
Net changes other thanshareholders’ equity
Balance at March 31, 2010

$ 250,647 $ 270,630 $2,348,616 $ (238,790) $255,8856,934 $

(48,861) $3,338 $

8,366

—

—

146,656

—

—

—

—

—

—

—

—

(28)

—

—

—

—

—

—

—

—

—

—

—

—

—

—

(76,127)

—

—

—

—

—

—

—

(12,751)

—

—

(160)

—

—

—

—

—

—

$ 250,647 $ 270,630 $2,406,394 $ (238,818) $31,868

2,364

1,251

596

38,802 $(46,657) $4,589 $

8,962

See accompanying notes.

ANNUAL REPORT 201035

Consolidated Statements of Cash FlowsJSR Corporation
Years ended March 31, 2008, 2009 and 2010

Thousands of
U.S. dollars(Note 1)Millions of yen

2008
Cash flows from operating activities:¥
Income before income taxes and minority interests
Adjustments to reconcile income before income taxes andminority interests to cash provided by operating activities:
Depreciation and amortization
Interest and dividend income
Interest expenses
Equity in earnings of affiliated companies
Loss (gain) on sales and disposal of property, plant and equipment
Impairment loss of fixed assets
Loss on devaluation of investment securities
Loss (gain) on sales of investment securities
Changes in operating assets and liabilities — net:
Decrease (increase) in notes and accounts receivable — trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable — trade
Other
Total
Interest and dividends received
Interest expenses paid
Income taxes paid
Net cash provided by operating activities
Cash flows from investing activities:
Payments for purchase of securities
Payments for purchase of property, plant and equipment and intangible assets
Payments for purchase of investment of subsidiaries and affiliates
Proceeds from sales of property, plant and equipment and intangible assets
Payments for purchase of investment securities
Proceeds from sales of investment securities
Proceeds from redemption of investment securities
Payments for loans receivableCollection of loans receivable
Other — net
Net cash used in investing activities
Cash flows from financing activities:
Net increase (decrease) in short-term loans payable
Repayment of long-term debt
Cash dividends paid
Cash dividends paid to minority shareholders
Purchase of treasury stock
Other — net
Net cash used in financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Increase (decrease) in cash and cash equivalents resulting
from change of scope of consolidation¥
Cash and cash equivalents at end of year (Note 3)
See accompanying notes.

36

JSR Corporation

54,867

2010

2009
¥

20,803¥

2010

19,458$ 209,135

21,180(1,309)256(1,249)
1,574
—
—
(377)

24,833(1,230)271(1,150)
(399)
6,042
1,887
—

22,380(568)
172(1,764)————

240,537(6,104)
1,852(18,965)
—
—
—
—

5,379
(5,693)(2,352)(79)
72,1972,530(254)(20,583)
53,89030,235(7,105)(38,012)
11,21747,392
2,592(276)(15,787)
33,921(20,453)
19,48418,891(1,328)56,272
2,090
(175)
468
58,655(219,833)
209,419
203,038(14,267)
604,81222,463(1,875)
5,031
630,431—(27,122)(491)—(1,653)601
500(2,683)
1,576(2,968)(32,240)—(22,736)(6,384)
408
(636)
8
2,000
(5,802)
2,880(6,203)(36,465)(6,000)(18,982)
—
—
—
189
—
(3,548)2,618(1,620)(27,343)(64,488)(204,021)
—
—
—
2,026
—
(38,134)
28,138(17,406)(293,885)

(222)
(476)
(7,033)(341)(5,329)0(13,401)
(819)
7,430
53,656(1,162)(1,234)(7,974)(167)(8,612)(3)(19,152)(2,903)(24,599)
61,725(221)(4)(7,082)
(11)
(2)
(5)
(7,325)37
24,024
37,125(2,370)(45)(76,117)
(124)
(28)
(52)
(78,736)398
258,208
399,026

255
61,4042,744$ 659,978

639
61,725¥—37,126¥

Notes to Consolidated Financial Statements
JSR Corporation
Years ended March 31, 2008, 2009 and 2010

1. Basis of Consolidated Financial Statements
The accompanying consolidated financial statements of JSR
Corporation (the “Company”) and its consolidated subsidiaries
have been prepared in accordance with the provisions set
forth in the Japanese Securities and Exchange Law and its
related accounting regulations, and in conformity withaccounting principles generally accepted in Japan (“Japanese
GAAP”), which are different in certain respects as to application and disclosure requirements of the International
Financial Reporting Standards.
The accounts of the Company’s overseas subsidiaries
and affiliates are based on their accounting records maintained in conformity with generally accepted accounting principles prevailing in the respective countries of domicile withnecessary amendments for consolidated financial statements. The accompanying consolidated financial statements
have been restructured and translated into English (withsome expanded descriptions) from the consolidated financial
statements of the Company prepared in accordance withJapanese GAAP and filed with the appropriate Local Finance
Bureau of the Ministry of Finance as required by the Japanese
Securities and Exchange Law. Some supplementary information included in the statutory Japanese language consolidated financial statements, but not required for fairpresentation, is not presented in the accompanying consolidated financial statements.
The translations of the Japanese yen amounts into U.S.
dollars are included solely for the convenience of readers outside Japan, using the prevailing exchange rate at March 31,
2010, which was ¥93.04 to U.S.$1.00. The conveniencetranslations should not be construed as representations that
the Japanese yen amounts have been, could have been, or
could in the future be, converted into U.S. dollars at this or any
other rate of exchange.
2. Summary of Significant Accounting Policies(a) Consolidation — The accompanying consolidated financial
statements include the accounts of the Company and its 28
significant subsidiaries in 2010 (28 significant subsidiaries in2008 and 2009).
All significant intercompany accounts and transactions
have been eliminated in consolidation.
JM Energy Corporation and JSR Trading (Shanghai) Co.,
Ltd. have been consolidated since 2010 due to the principle ofmateriality, and Excel Tokai Co., Ltd. has been excluded fromthe scope of consolidation since 2010 due to transfer of allshares.
Effective June 16, 2009, JSR Service Co., Ltd. mergedwith JNT System Co., Ltd. and changed its corporate nameinto JSR Business Service Co., Ltd..
JSR Micro Taiwan Co., Ltd. and Elastomix (Foshan) Co.,
Ltd. have been consolidated since 2008 due to the principle of materiality.
(b) Equity method — Investments in affiliated companies(all of those 20% to 50% owned and certain others 15% to

20% owned) were accounted for by the equity method.
Unconsolidated subsidiaries and the other affiliated companies
are stated at cost since their net income and retained earnings
in the aggregate are not material compared to consolidated
net income and retained earnings, respectively.
(c) Cash and cash equivalents — In preparing the consolidated statements of cash flows, cash on hand, readily
available deposits and short-term highly liquid investmentswith maturities not exceeding three months at the time ofpurchase are considered to be cash and cash equivalents.
(d) Marketable securities and investment securities — The
Company and its consolidated subsidiaries (the “Companies”)
had no trading securities or held-to-maturity debt securities.
Equity securities issued by subsidiaries and affiliatedcompanies, which are not consolidated or accounted forusing the equity method, are stated at moving-average cost.
Available-for-sale securities with available fair market values
are stated at fair market value and unrealized gains andlosses on these securities are reported, net of applicable
income taxes, as a separate component of net assets.
Realized gains and losses on sale of such securities arecomputed using moving-average cost. Available-for-salesecurities with no available fair market values are stated atmoving-average cost or amortized cost.
(e) Inventories — Inventories are stated at cost, which isdetermined mainly based on the average method (for thevalue stated on the balance sheet, book value is written down
to reflect the lower profitability ).
(i) The accounting change
Effective April 1, 2008, the Company and domestic consolidated subsidiaries adopted “Accounting Standard for
Measurement of Inventories” (Statement No.9 by ASBJ
on July 5, 2006). As a result of this change, Operating
income and Income before income taxes and minority
interests decreased by ¥2,859 million and ¥1,934 million
for the year ended March 31, 2009 respectively.
(f) Property, plant and equipment, and depreciation —Property, plant and equipment are stated at cost. Depreciationis computed using the declining-balance method at rates
based on their estimated useful lives except for buildings
acquired after March 31, 1998, which are depreciated basedon the straight-line method.
(i) The accounting change
Effective April 1, 2007, the Company and domestic
consolidated subsidiaries changed the depreciation
method for property, plant and equipment acquired on
or after April 1, 2007 in accordance with the revised
Corporation Tax Law of Japan. As a result of thischange, income before income taxes and minority interests decreased by ¥851 million for the year ended
March 31, 2008 from the corresponding amounts which
would have been recorded under the previous method.
(ii) Additional information
Effective April 1, 2008, the Company and its domestic
consolidated subsidiaries reviewed the economic use-

ANNUAL REPORT 201037

ful life to depreciate machinery and equipment, responding to the revision of the Corporation Tax Law of Japan.
The impact of this change did not have a material effecton net income.
Effective from the year ended March 31, 2008,
property, plant and equipment acquired before April 1,
2007 for which the allowable limit on the depreciable
amount has been reached are to be depreciated evenly over five years from the following fiscal year. As aresult of this change, income before income taxes andminority interests decreased by ¥1,429 million for theyear ended March 31, 2008.
(g) Intangible assets — Goodwill is amortized over five years
using the straight-line method.
Software for its own use is amortized over the estimateduseful life (five years) using the straight-line method.
(h) Leased assets —(i) The accounting change
Effective April 1, 2008, the Company and domestic consolidated subsidiaries adopted “Accounting Standard
for Lease Transactions” (Statement No.13 by ASBJ on
March 30, 2007) and the Guidance on AccountingStandard for Lease Transactions (Implementation
Guidance No.16 by ASBJ on March 30, 2007).
The method of accounting for finance leases that
do not transfer ownership of leased property to the lesseechanged from treating such leases as rental transactions
to treatment as sale/purchase transactions, recognizingthem as leased assets.
Under the existing accounting standards, financeleases, commenced prior to April 1, 2008, which do nottransfer ownership of leased property to the lessee are
permitted to be accounted for in the same manner as
operating leases if certain “as if capitalized” information isdisclosed in a note to the lessee’s financial statements.
The impacts of this change did not have a material
effect on net income.
(i) Allowance for doubtful accounts — Allowance for doubtful
accounts is provided in amounts sufficient to cover possible
losses on collection. Allowance for doubtful accounts consistsof the estimated uncollectible amount with respect to specificitems, and the amount calculated using the actual percentage
of collection losses in the past with respect to other items.
(j) Severance and retirement benefits — Employees of theCompanies are entitled, under most circumstances, to lumpsum severance payments or pension payments upon reaching
the mandatory retirement age, or earlier in the case of voluntary
or involuntary termination, based on the compensation at thetime of severance and years of service.
The Companies provided allowances and expenses for
employees’ severance and retirement benefits at year-end
based on the estimated amounts of projected benefits obligation and the fair value of the pension assets.
The prior service costs are recognized as expenses using
the straight-line method over three years, which falls within

38

JSR Corporation

the estimated average remaining service lives, commencing with the following period. Actuarial differences of theCompanies are recognized as expenses at once in the following period.
(i) The accounting change
Effective for the year ended March 31, 2010, theCompanies adopted “Partial Amendments to AccountingStandard for Retirement Benefits (Part3)” (Statement
No.19 by ASBJ on July 31, 2008). The impact of thischange did not have a material effect on projected benefits obligation and net income.
(k) Allowance for environmental expenses — An allowancefor expenses is provided based on estimated costs for the
disposal of polychlorinated biphenyl (PCB) as mandated by the
Law Concerning Special Measures Against PCB Waste.
(l) Income taxes — The Companies provide for income taxes
applicable to all items included in the consolidated statements
of income regardless of when such taxes are payable. Income
taxes based on temporary differences between tax andfinancial reporting purposes are reflected as deferred income
taxes in the consolidated financial statements using the asset
and liability method.
(m) Derivative and hedging activities — The Companies use
derivative financial instruments to manage their exposures tofluctuations in foreign exchange and interest rates. Foreignexchange forward contracts, foreign currency swaps and interest
rate swaps are utilized by the Companies to reduce foreign
currency exchange and interest rate risks. The Companies
do not enter into derivatives for trading purposes or speculative
purposes. Derivative financial instruments and foreign currencytransactions are classified and accounted for as follows:(i) All derivatives are recognized as either assets or liabilities and measured at fair value, and gains or losses onthese derivative transactions are recognized in the consolidated statements of income.
(ii) For derivatives used for hedging purposes, if derivatives
qualify for hedge accounting because of high correlationand effectiveness between the hedging instruments andthe hedged items, gains or losses on these derivatives
are deferred until maturity of the hedged transactions.
The interest rate swaps that qualify for hedge accounting and meet specific matching criteria are not remeasured
at market value, but the differential paid or received under theswap agreements is recognized and included in interest
expense or income as incurred.
(n) Foreign currency transactions — The Companies translate
assets and liabilities denominated in foreign currencies into
Japanese yen at exchange rates prevailing at the balance
sheet dates. Resulting exchange gains or losses are credited
or charged to income as incurred.
(o) Translation of foreign currency financial statements —Financial statements of overseas subsidiaries are translated into
Japanese yen using the respective year-end rate for assets
and liabilities, the average rate for revenues and expenses, andthe historical rates for shareholders’ equity accounts. Foreignassets — Effective for the year ended March 31, 2007, theCompanies newly adopted “Accounting Standard forStatement of Changes in Net Assets” (Statement No.6 by
ASBJ on December 27, 2005), and “Implementation Guidance
for the Accounting Standard for Statement of Changes in
Net Assets” (Implementation Guidance No.9 by ASBJ on
December 27, 2005).
Accordingly, the Company prepared the statement ofchanges in net assets for the year ended March 31, 2007.
(s) Stock options — Effective from the year ended March 31,
2007, the Company newly adopted “Accounting Standard for
Share-based Compensation” (Statement No.8 by ASBJ on
December 27, 2005) and “Guidance on Accounting Standard
for Share-based Compensation” (Implementation Guidance
No.11 by the ASBJ on May 31, 2006).
The adoption of these accounting standards did not havea material effect on net income.
(t) Reclassifications — Certain prior year amounts have been
reclassified and restated to conform to the current year
presentation.
These reclassifications and restatements had no effect onpreviously reported results of operations or retained earnings.

currency translation adjustments are contained in valuation andtranslation adjustments and minority interests.
(p) Amounts per share of common stock — The computationof net income per share of common stock is based on the
average number of shares outstanding during each fiscal
year. Treasury stock has been excluded in the calculation ofamounts per share of common stock.
Cash dividends per share represent actual amounts applicable to the respective years.
(q) Practical solution on unification of accounting policies
applied to foreign subsidiaries for consolidated financial
statements —(i)The accounting change
Effective April 1, 2008, the Company adopted “Practical
Solution on Unification of Accounting Policies Applied toForeign Subsidiaries for Consolidated Financial
Statements” (ASBJ Practical Issues Task Force No.18
issued on May 17, 2006). According to this rule, theCompany made necessary adjustments for significant
differences between Japanese GAAP and IFRS or
U.S.GAAP. The adoption of this rule did not have amaterial effect on net income.
(r) Accounting standard for statement of changes in net

3. Cash and Cash Equivalents
Cash and cash equivalents at March 31, 2008, 2009 and 2010 consisted of the following:Thousands of
U.S. dollars

Millions of yen

2008
Cash
Short-term investment securities
Time deposits over three months
Cash and cash equivalents¥¥

16,53746,484(1,296)
61,725

2009¥¥

16,91021,492(1,277)
37,125

2010¥

36,67734,000(9,273)
61,404¥2010$ 394,204
365,434(99,660)$ 659,9784. Allowance for doubtful accounts
Allowance for doubtful accounts of March 31, 2009 and 2010 were as follows:
Thousands of
U.S. dollars

Millions of yen

Allowance for doubtful accounts
Current asset : Notes and accounts receivable — trade
Investments and other non-current assets: Other assets

2009
¥

(554)
(148)

2010
¥

(766)
(103)

2010
$ (8,232)(1,110)ANNUAL REPORT 201039

5. Marketable Securities and Investment Securities(1) The following tables summarize the acquisition cost, book value and fair value of available-for-sale securities with available fairvalue as of March 31, 2009 and 2010:(a) Securities with book value exceeding acquisition cost
Millions of yen

2009
Equity securities

Acquisition cost

Book value

Difference¥ 8,069¥ 11,323¥ 3,254

Millions of yen

2010
Equity securities

Acquisition cost

Book value

Difference¥ 9,787¥ 16,136¥ 6,349

Thousands of U.S. dollars

2010
Equity securities

Acquisition cost

Book value

Difference$ 105,188$ 173,432$

68,244(b) Securities with book value not exceeding acquisition cost
Millions of yen

2009
Equity securities

Acquisition cost

Book value

Difference¥ 6,040¥ 3,926¥ (2,114)

Millions of yen

2010
Equity securities

Acquisition cost

Book value

Difference¥ 2,296¥ 2,035¥(261)

Thousands of U.S. dollars

2010
Equity securities

Acquisition cost

Book value

Difference$ 24,682$ 21,875$ (2,807)(2) The following tables summarize the book value of available-for-sale securities with no available fair value as of March 31, 2009
and 2010:
Thousands of
U.S. dollars

Millions of yen

2009
Non-listed equity securities
Commercial paper
Certificate of deposit
Other
Total

40

JSR Corporation

¥

¥

1,066
7,492
10,0004,000
22,558

2010
¥

¥

2,866
—
30,0004,000
36,866

2010$

30,801—
322,442
42,992$ 396,235

(3) Redemption schedule of available-for-sale securities with fixed maturities are as follows:
Millions of yen

March 31, 2009:
March 31, 2010:

Withinone yearOver oneyear
withinfive years

Over fiveyears
withinten years

Over tenyears¥ 21,492¥ 34,000

¥
¥

¥
¥

¥
¥

—
—

—
—

—
—

Total

¥ 21,492¥ 34,000Thousands of U.S. dollars

March 31, 2010:

Withinone yearOver oneyear
withinfive years

Over fiveyears
withinten years$ 365,434

$

$

—

—

Over ten
years

$

—

Total

$ 365,434(4) Total sales of available-for-sale securities sold and the related gains and losses for the years ended March 31, 2008, 2009 and2010 are as follows:
Thousands of
U.S. dollars

Millions of yen

2008
Total sales
Gain
Loss

¥

493
377
—

2009
¥

8
—
2

2010
¥

177
37
—

2010
$ 1,897400—

6. Short-Term Loans Payable and Long-Term Debt
Short-term loans payable represent primarily overdrafts from banks bearing interest at 1.2% and 0.9% per annum (weighted average interest rate) at March 31, 2009 and 2010, respectively.
Long-term debt at March 31, 2009 and 2010 consisted of the following:Thousands of
U.S. dollars

Millions of yen

Loans principally from banks and insurance companies due through2014 with interest rates 1.2% in 2009 and 2010:
SecuredUnsecuredLess amount due within one year

2009

2010

2010

1
1,503
1,504
(4)
¥ 1,500

1
1,499
1,500
—
¥ 1,500

11
16,111
16,122—$ 16,122

18
(5)
13

30
(8)
22

326
(86)
240

Lease liabilityLess amount due within one year¥¥$

At March 31, 2010, property, plant and equipment, at book value of ¥9,669 million ($103,919 thousand) were pledged ascollateral for secured loans.
The annual maturities of long-term debt at March 31, 2010 were as follows:
Millions of yen
Year ending March 31,

2011
2012
2013
2014
2015
2016 and thereafterLong-term loans
payable

¥

—
500
1,000
—
—
—
¥ 1,500

Thousands of U.S. dollars

Lease liability

¥

¥

8
7
8
4
3
—
30

Long-term loans
payable$—
5,374
10,748———$ 16,122

Lease liability

$

$

86
80
81
47
32
—
326

ANNUAL REPORT 201041

7. Employees’ Severance and Retirement Benefits
Employees’ retirement benefits included in the liability section of the consolidated balance sheets as of March 31, 2009 and 2010
consisted of the following:
Millions of yen

2009
Projected benefit obligation
Less fair value of pension assets
Unfunded retirement benefit liabilities
Unrecognized actuarial differences
Net retirement benefit liabilities
Prepaid pension costs
Employees’ retirement benefits¥

49,493(33,268)
16,225(1,693)
14,532(289)¥ 14,821

Thousands of
U.S. dollars

2010

2010

49,044(34,361)
14,683
1,220
15,903—¥ 15,903$ 527,134(369,317)
157,817
13,114
170,931—$ 170,931¥

Included in the consolidated statements of income for the years ended March 31, 2008, 2009 and 2010 were severance andretirement benefit expenses consisting of the following:Thousands of
U.S. dollars

Millions of yen

Service costs—benefits earned during the year
Interest cost on projected benefits obligation
Expected return on plan assets
Amortization of prior service costs
Amortization of actuarial differences
Severance and retirement benefit expenses

2008

2009

2010

2010

¥ 1,789
896
(445)
(61)
(51)
¥ 2,128¥ 2,292
877
(368)
(61)
417
¥ 3,157¥ 1,758
946
(324)
—
1,679
¥ 4,059$ 18,897
10,170(3,483)—18,045$ 43,629

The discount rates used by the Companies for the years ended March 31, 2009 and 2010 are mainly 2.1% and 2.2%, respectively. The rates of expected return on plan assets used by the Companies for the years ended March 31, 2009 and 2010 are
mainly 1.1% and 1.0%, respectively. The estimated amount of all retirement benefits to be paid at the future retirement date isallocated equally to each service year using the estimated number of total service years.
8. Income Taxes
Income taxes in the accompanying consolidated statements of income comprise corporation, enterprise and inhabitants’ taxes. The
aggregated normal effective tax rate was approximately 40.7%.
The following table summarizes the significant differences between the statutory tax rate and the Companies’ effective tax
rates for financial statement purposes for the years ended March 31, 2008, 2009 and 2010:
Statutory tax rate
Tax credit on research and development costs
Lower tax rates for foreign consolidated subsidiaries
Equity in earnings of affiliated companies
Valuation allowance
Other
Effective tax rate

42

JSR Corporation

2008

2009

2010

40.7%
(3.2)
(5.0)
(0.9)
(0.4)
0.4
31.6%

40.7%
(4.4)
(5.5)
(2.2)
3.0
(2.1)
29.5%

40.7%
(6.9)
(6.8)
(3.7)
6.0
0.3
29.6%

Significant components of the Companies’ deferred tax assets and liabilities as of March 31, 2009 and 2010 were as follows:
Thousands of
U.S. dollars

Millions of yen

2009
Deferred tax assets:
Excess retirement benefits
Impairment loss of fixed assets
Excess bonuses accrued
Provision for environmental expenses
Unrealized gain on sale of inventories
Unrealized gain on sale of property, plant and equipment
Other
Sub-total
Valuation allowance
Total deferred tax assets¥

Deferred tax liabilities:
Deferred gain on sale of fixed assets
Net unrealized holding gains on securities
Other
Total deferred tax liabilities
Net deferred tax assets

¥

2010
¥

5,845
2,452
1,630
1,303
769
1,094
3,012
16,105(709)
15,396(2,963)(447)(902)(4,312)
11,084

¥

2010

6,409
1,904
1,603
1,294
1,179
1,054
4,727
18,170(2,254)
15,916$

68,883
20,464
17,22913,912
12,676
11,33250,792
195,288(24,220)
171,068(2,807)(2,475)(726)(6,008)
9,908(30,171)(26,599)(7,806)(64,576)$ 106,492

9. Impairment of Fixed Assets
The Companies recognized impairment losses on the following group of fixed assets for the year ended March 31, 2009 and 2010.
Millions of yen

2009
Use

Facility for a heat-resistanttransparent resin
Facility for plastic products

Location

Ichihara City, Chiba Prefecture
Yokkaichi City, Mie Prefecture
Satte City, Saitama Prefecture

Machinery,
Buildings andequipment andstructures
vehicles

¥

455
781
256

¥ 1,950
1,921
245

Others

Total

101
236
97

¥ 2,506
2,938
598

Others

Total¥

Millions of yen

2010
Use

Facility for compoundingof crude rubber

Location

Tosu City, Saga Prefecture

Machinery,
Buildings andequipment andstructures
vehicles

¥

117

¥

68

¥

26

¥

211

Thousands of U.S. dollars

2010
Use

Facility for compoundingof crude rubber

Location

Tosu City, Saga Prefecture

Machinery,
Buildings andequipment andstructures
vehicles$ 1,259$

732$

OthersTotal

272$ 2,263

The impairment loss for the year ended March 31, 2010, is included in restructuring of ¥1,191 million ($12,804 thousand) in theother expenses section of the consolidated statement of income.
The companies have grouped their fixed assets into business units. Fixed assets that are idle or are not being used for businessactivities are assessed individually. The book value of machinery and equipment etc. was written down to its recoverable value.
ANNUAL REPORT 201043

10. Net Assets
Under Japanese laws and regulations, the entire amount paid
for new shares is required to be designated as common stock.
However, a company may, by a resolution of the Board of
Directors, designate an amount not exceeding one-half of theprice of new shares as additional paid-in capital, which isincluded in capital surplus.
Under Japanese Corporate Law (“the Law”), in the casewhere a dividend distribution of surplus is made, the smaller ofan amount equal to 10% of the dividends or the excess, ifany, of 25% of common stock over the total of additional
paid-in capital and legal earnings reserve must be set aside asadditional paid-in capital or legal earnings reserve. Legal earnings reserve is included in retained earnings in the accompanying consolidated balance sheets.

Additional paid-in capital and legal earnings reserve may
not be distributed as dividends. Under the Law, however, alladditional paid-in capital and all legal earnings reserve may
be transferred to other capital surplus and retained earnings,
respectively, which are potentially available for dividends.
The maximum amount that the Company can distribute as
dividends is calculated based on the non-consolidated financial statements of the Company in accordance with Japaneselaws and regulations.
At the annual shareholders meeting held on June 18,
2010, the shareholders resolved cash dividends amounting
to ¥3,175 million ($34,125 thousand). Such appropriations
have not been accrued in the consolidated financial statements as of March 31, 2010. Such appropriations are recognized in the period in which they are resolved.

11. Stock Option Plans
The shareholders of the Company approved the issuance of stock options to the directors and executive officers of the Company
as follows:
Date of resolution of the general shareholders’ meeting

The maximum number of shares to be issued
Exercisable period of stock options
Stock subscription rights which have been vested
Outstanding as of March 31, 2008
Exercise price per share

June 16, 2006

62,500 shares
39,100 shares
From June 18, 2005 From August 2, 2006
to June 17, 2025
to June 16, 2026
50,300 shares1$ 0.01

36,000 shares
1$0.01

Date of resolution of the general shareholders’ meeting

June 13, 2008

June 16, 2009

The maximum number of shares to be issued
Exercisable period of stock options

73,900 shares
From July 16, 2008
to July 15, 2028

80,200 shares
From July 15, 2009
to July 14, 2029

73,900 shares1$ 0.0180,200 shares1$ 0.01

Stock subscription rights which have been vested
Outstanding as of March 31, 2008
Exercise price per share

12. Derivative Transactions(1) Qualitative disclosure about derivatives
The Companies enter into foreign exchange forward contracts, foreign currency swap contracts and interest rate
swap contracts as derivative financial instruments. The
Companies deal with foreign exchange forward transactions to hedge exchange rate risks of trade receivables andpayables denominated in foreign currency. Foreign currency swap transactions are made in order to mitigate foreignexchange risks on loans receivable denominated in foreign
currencies. Interest rate swap transactions are made inorder to reduce interest rate risks on loans payable.
The Companies do not enter into derivatives for speculativetransaction purposes. Hedge accounting is used for interest
rate swaps in the case where there is a high degree of correlation between the hedge instruments and the hedge items.

44

June 17, 2005

JSR Corporation

June 15, 2007

48,500 shares
From July 11, 2007
to July 10, 2027
48,500 shares
1$0.01

Significant conditions surrounding hedging instruments are
the same as those for the items hedged, the risks of which
will likely continue to be hedged through hedge transactions.
Foreign exchange forward contracts and foreign currency
swaps that the Companies entered have risks due to fluctuations in foreign exchange rates. Interest rate swap contracts
that the Companies entered have risks due to fluctuations ininterest rates. Due to the fact that counterparties to theCompanies represent major financial institutions that havehigh creditworthiness, the Companies believe that the overall
credit risk related to its financial instruments is insignificant.
Derivative transactions are executed and controlled
based on the Companies’ internal rules and are approvedby the responsible officials. The balances of such transactions with counterparties are periodically confirmed.

Contract amounts, market values and recognized gains
or losses on the derivative transactions, except thoseaccounted for using hedge accounting, at March 31, 2009
and 2010 were as follows:(2) Quantitative disclosure about derivatives
The following contract amounts are only nominal or notional amounts of derivatives, and do not necessarily indicate
the magnitude of market risk associated with the derivativetransactions.
(a) Related to currencies

Millions of yen
Contract amountMarch 31, 2009:
Items not traded on exchanges
Foreign exchange forward contracts
Selling: U.S. Dollars
Euro
Buying: U.S. Dollars
Euro
Swiss Franc
Foreign currency swaps
receiving Japanese Yen paying, Korean won
receiving Japanese Yen paying, Taiwanese dollar
Total
March 31, 2010:
Items not traded on exchanges
Foreign exchange forward contracts
Selling: U.S. Dollars
Euro
Buying: U.S. Dollars
Euro
Swiss Franc
Foreign currency swaps
receiving Japanese Yen paying, Taiwanese dollar
TotalOver one year

Market value

Recognized
gains or losses¥ 5,041
415
38
51
5

¥

—
—
—
—
—

¥ 5,161
407
37
54
6

¥

3,065
5,739
¥
—

—
3,594
¥
—

804
1,066
¥
—

804
1,066
¥ 1,761¥ 6,671
588
444
32
7

¥

¥ 6,750
573
445
32
7

¥

¥

3,594
—

¥

—
—
—
—
—
2,909
—

¥

564
—

¥

(120)
8
(1)
3
1

(79)
15
1
(0)
0
564
501

Thousands of U.S. dollars

March 31, 2010:
Items not traded on exchanges
Foreign exchange forward contracts
Selling: U.S. Dollars
Euro
Buying: U.S. Dollars
Euro
Swiss Franc
Foreign currency swaps
receiving Japanese Yen paying, Taiwanese dollar
Total$ 71,700
6,325
4,773
348
75

$

38,624
—

$

$

—
—
—
—
—
31,268—$ 72,551
6,163
4,783
347
78

$

6,063
—

$

(851)
162
10
(1)
3

6,063
$ 5,386

Market values are calculated using foreign exchange forward rates.
(b) Related to interests
Interest rate swap contracts, for which hedge accounting is adopted, are excluded from being an object of disclosure.

ANNUAL REPORT 201045

13. Information for Certain Lease Payments
As described in Note 1.(h), under the existing accounting standards, finance leases, commenced prior to April 1, 2008, which
do not transfer ownership of leased property to the lessee are accounted for in the same manner of operating leases:(1) Equivalent amounts of purchase price, accumulated depreciation and book value of leased properties were as follows(including the interest portion thereon):Thousands of
U.S. dollars

Millions of yen

2009
Machinery, equipment and vehicles:
Purchase price equivalent
Accumulated depreciation equivalentBook value equivalent
Tools, furniture and fixtures:
Purchase price equivalent
Accumulated depreciation equivalentBook value equivalent
Total:
Purchase price equivalent
Accumulated depreciation equivalentBook value equivalent

¥
¥
¥
¥
¥
¥

2010

37
20
17

¥

101
60
41

¥

138
80
58

¥

¥

¥

¥

2010

149
108
41

$ 1,606
1,164
$ 442

62
38
24

$

211
146
65

$ 2,272
1,572
$ 700

666
408
258

$

(2) Lease commitments (including the interest portion thereon):Thousands of
U.S. dollars

Millions of yen

2009
Due within one year
Due over one year

¥
¥

25
33
58

2010
¥
¥

35
30
65

2010
$

382
318
700

$

(3) Lease expenses and depreciation equivalent:Thousands of
U.S. dollars

Millions of yen

2008
Lease expenses
Depreciation equivalent

¥

147
147

2009
¥

119
119

2010
¥

56
56

2010
$

604
604

Depreciation equivalent is computed using the straight-line method over the term of each lease with no residual value.
There is no impairment loss on finance leases.
14. Contingent Liabilities
At March 31, 2010, the Company and certain consolidated
subsidiaries were contingently liable as guarantors for loans of
employees and others in the amount of ¥50 million ($532
thousand).

46

JSR Corporation

15. Research and Development Expenses
Research and development expenses of the Companies forthe years ended March 31, 2008, 2009 and 2010 were¥19,118 million, ¥21,061 million and ¥18,052 million ($194,027
thousand), respectively, which are included in selling, generaland administrative expenses or manufacturing costs.

16. Segment Information
The Companies’ business segments are classified into the following four business segments ranked in order of importance: (1) elastomers business (2) emulsions business, (3) plastics business, and (4) fine chemicals and other products business.
A summary of net sales, costs and expenses, operating income, identifiable assets, depreciation, impairment loss and capital
expenditures by segment of business activities for the years ended March 31, 2008, 2009 and 2010 were as follows:
Millions of yen

Elastomers

Emulsions

Plastics

Finechemicals
and otherproducts

Total

Elimination
and/orcorporate

Consolidated

For 2008:
Sales to external customers ¥Inter-segment sales/transfers
Costs and expenses¥
Operating income¥
Identifiable assets
Depreciation and amortization
Capital expenditures

128,953 ¥537
118,322
11,168 ¥
130,586 ¥
5,075
7,185

26,994 ¥
4,300
29,752
1,542 ¥
24,861 ¥
1,501
1,226

68,845 ¥—
65,832
3,013 ¥
34,375 ¥
1,546
1,835

182,176 ¥
15,358153,247
44,287 ¥160,524 ¥
13,05818,831

406,968 ¥20,195367,153
60,010 ¥350,346 ¥21,18029,077— ¥(20,195)(20,195)— ¥66,605 ¥——406,968—
346,958
60,010416,951
21,18029,077

For 2009:
Sales to external customers ¥Inter-segment sales/transfers
Costs and expenses¥
Operating income¥
Identifiable assets
Depreciation and amortization
Impairment loss
Capital expenditures

117,856 ¥522
110,351
8,027 ¥
120,322 ¥
6,001
—
6,205

23,433 ¥4,180
27,096517 ¥
19,313 ¥
1,787
—
2,039

64,829 ¥—63,521
1,308 ¥
30,145 ¥
1,619
598
1,640

146,385 ¥
16,931
142,820
20,496 ¥131,341 ¥
15,4265,444
9,198

352,503 ¥21,633
343,788
30,348 ¥
301,121 ¥
24,833
6,042
19,082— ¥(21,633)(21,633)— ¥38,377 ¥———352,503—
322,155
30,348339,498
24,833
6,042
19,082

For 2010:
Sales to external customers ¥Inter-segment sales/transfers
Costs and expenses¥
Operating income¥
Identifiable assets
Depreciation and amortization
Impairment loss
Capital expenditures

104,606 ¥433
105,543(504) ¥
121,914 ¥
7,082
211
5,395

16,997 ¥2,953
19,672278 ¥
17,524 ¥
1,582
—
840

48,041 ¥—48,045(4) ¥26,652 ¥
1,445
—
921

140,540 ¥11,965132,045
20,460 ¥
134,758 ¥
12,271—
10,551

310,184 ¥
15,351
305,305
20,230 ¥300,848 ¥22,380211
17,707— ¥(15,351)(15,351)— ¥72,717 ¥———

310,184—
289,954
20,230373,566
22,380211
17,707

Thousands of U.S. dollars

For 2010:
Sales to external customers $ 1,124,303 $4,659Inter-segment sales/transfers
1,134,382
Costs and expenses$(5,420) $Operating income$ 1,310,339 $Identifiable assets
76,113
Depreciation and amortization
2,263
Impairment loss
57,986
Capital expenditures

182,689 $
31,739211,441
2,987 $
188,354 $17,003—
9,031

516,350 $ 1,510,532 $ 3,333,874 $— $ 3,333,874—
128,602
165,000(165,000)—
516,389
1,419,226
3,281,438(165,000) 3,116,438(39) $ 219,908 $ 217,436 $— $ 217,436
286,461 $ 1,448,383 $ 3,233,537 $ 781,571 $ 4,015,108
15,531
131,890
240,537—
240,537
—
—
2,263
—
2,263
9,894
113,406
190,317—
190,317

Costs and expenses in elimination and/or corporate thatcannot be allocated to business segments are related mainly
to fundamental research and development. Assets in elimination and/or corporate are related mainly to Cash, Marketable
Securities and Investment Securities of the Company. Capital

expenditures are recognized on an accrual basis.
As noted in Note 2. (e) (i) , effective April 1, 2008, theCompany and its domestic consolidated subsidiaries adopted
the “Accounting Standards for Measurement of Inventories”(Statement No.9, by ASBJ ,on July 5, 2006), and used the

ANNUAL REPORT 201047

value method to devaluate the book value to reflect the lower
profitability. As a result of this change, the operating income
decreased ¥1,102 million in the Elastomers segment, ¥17
million in the Emulsions segment, ¥57 million in the Plastics
segment and ¥1,683 million in the Fine chemicals and otherproducts segment.
As noted in Note 2. (f) (i), effective April 1, 2007, theCompany and its domestic consolidated subsidiaries changed
depreciation methods. As a result of this change, depreciation
expenses increased ¥178 million in the Elastomers segment,¥41 million in the Emulsions segment, ¥51 million in the Plastics

segment and ¥581 million in the Fine chemicals and other products segment.
Also, effective from the year ended March 31, 2008, property, plant and equipment acquired before April 1, 2007 forwhich the allowable limit on the depreciable amount has beenreached are to be depreciated evenly over five years from thefollowing fiscal year. As a result of this change, depreciation
expenses increased ¥889 million in the Elastomers segment,¥252 million in the Emulsions segment, ¥60 million in the
Plastics segment and ¥180 million in the Fine chemicals andother products segment.

Geographic segment information with respect to net sales, costs and expenses, operating income, and identifiable assets
for the years ended March 31, 2008, 2009 and 2010 were as follows:
Millions of yen
Japan

For 2008:
Sales to external customers
Inter-segment sales/transfers
Costs and expenses
Operating income
Identifiable assets
For 2009:
Sales to external customers
Inter-segment sales/transfers
Costs and expenses
Operating income
Identifiable assets
For 2010:
Sales to external customers
Inter-segment sales/transfers
Costs and expenses
Operating income
Identifiable assets

¥

¥
¥

¥

¥
¥

¥

¥
¥

Asia

308,758
64,878319,680
53,956296,347¥

262,324
54,040291,227
25,137257,380¥

232,135
51,620267,897
15,858254,968

¥

¥
¥

¥
¥

¥
¥

Others74,552
67
70,236
4,383
34,874¥71,65572
67,9393,788
28,222¥

65,234
173
61,231
4,176
30,296

¥

¥
¥

¥
¥

¥
¥

Elimination
and/orCorporate

Total

23,6584,423
26,4101,671
19,125¥

18,5244,600
21,701
1,423
15,519¥12,815
4,768
17,387
196
15,584

¥

¥
¥

¥
¥

¥
¥

406,968
69,368416,326
60,010350,346¥

352,50358,712
380,867
30,348301,121¥

310,184
56,561
346,515
20,230300,848

¥

¥
¥

¥
¥

¥
¥

Consolidated—(69,368)(69,368)—
66,605¥—(58,712)(58,712)—38,377¥—(56,561)(56,561)—
72,717

¥

¥
¥

¥
¥

¥
¥

406,968—
346,958
60,010416,951

352,503—
322,155
30,348339,498

310,184—
289,954
20,230373,566

Thousands of U.S. dollars

For 2010:
Sales to external customers
Inter-segment sales/transfers
Costs and expenses
Operating income
Identifiable assets$ 2,495,004
554,8172,879,377$ 170,444$ 2,740,414$$$

701,140
1,858
658,11044,888
325,624$$$

137,730
51,254
186,880
2,104
167,499$ 3,333,874
607,9293,724,367$ 217,436$ 3,233,537$—(607,929)(607,929)$—$ 781,571$ 3,333,874—
3,116,438$ 217,436$ 4,015,108

The geographical segments consist in Japan, Asia and Others. Effective from the year ended March 31, 2008, the region
previously reflected as Others has been divided into Asia and Others, considering the materiality of the sales in Asia. Main countries
and regions included in each geographical segment were as follows:
Asia : China, Korea, Taiwan, Thailand
Others : United States, Belgium

48

JSR Corporation

Overseas sales for the years ended March 31, 2008, 2009 and 2010 were as follows:
Millions of yen

For 2008:
Overseas sales
Consolidated net sales
Percentage of overseas sales to consolidated sales
For 2009:
Overseas sales
Consolidated net sales
Percentage of overseas sales to consolidated sales
For 2010:
Overseas sales
Consolidated net sales
Percentage of overseas sales to consolidated sales

Asia

North America

OthersTotal¥

133,837—32.9%¥

15,864—
3.9%¥

16,689—4.1%¥ 166,390
406,968
40.9%¥

117,657—
33.4%¥

12,078—
3.4%¥

13,811—
3.9%¥ 143,546
352,503
40.7%¥

117,503
—
37.9%

¥

9,077
—
2.9%

¥

12,300—4.0%¥ 138,880
310,184
44.8%

Thousands of U.S. dollars

For 2010:
Overseas sales
Consolidated net sales$ 1,262,926—$

97,557—$ 132,204—$ 1,492,687
3,333,874

Overseas sales are segmented into Asia, North America and Others. Main countries and regions included in each segment were as follows:
Asia : China, Korea, Taiwan, Thailand, Singapore
North America : United States
Others : Europe
17. Related Parties
Significant transactions and balances with related parties as of and for the years ended March 31, 2008, 2009 and 2010 were as follows:
Thousands of
U.S. dollars

Millions of yen

2009

2008
BRIDGESTONE Corporation (a major shareholder):Sales
Notes and accounts receivable
KRATON JSR Elastomers K.K. (an affiliated company):
Purchases
Notes and accounts payable
JM Energy Corporation (an affiliated company):
Loans
Loans receivable
Tobu Butadiene Co., Ltd. (an affiliated company):
Purchases
Notes and accounts payable
Provision of materials for processing
Accounts receivable — other¥38,87812,855¥

2010

38,663
9,157

¥

2010

27,74913,328$ 298,244
143,254

12,117
5,435

10,867
4,219

—
—

—
—

—
—

3,000
3,000

—
—

—
—

13,632
6,507
11,642
5,327

—
—
—
—

9,855
4,827
7,607
3,960

105,919
51,87781,75842,566

18. Subsequent Events
At the June 18, 2010 annual meeting, the Companies’ shareholders approved the following appropriations of retained earnings:
Payment of a year-end cash dividend of ¥13.00 per share aggregating ¥3,175 million ($34,125 thousand).

ANNUAL REPORT 201049

Independent Auditors’ Report

50

JSR Corporation

Corporate Data
(As of June 18, 2010)
Company NameJSR Corporation

Closing Date
JSR’s books are closed on March 31 eachyear.

Transfer Agent and Register
The Chuo Mitsui Trust and Banking Co.,Ltd.

Capital¥23,320,165,484

Annual General Meeting
The annual general meeting of shareholders is held in June each year.

Auditors
KPMG AZSA & Co.

Employees
5,212 (As of March 31, 2010)

The 2010 annual general meeting was heldon June 18.

Established
December 10, 1957

Home Page
http://www.jsr.co.jp/jsr_e/index.html

Investor Information(As of March 31, 2010)
Number of Shares Issued
255,885,166 shares

Common Stock Price Range(Tokyo Stock Exchange)

Number of Shareholders
21,927
Major Shareholders
Percentage Number ofof shares shares held
held (%) (thousands)

Name

Bridgestone Corporation
15.97
The Master Trust Bank of Japan,Ltd. (Trust Account) 6.38
Japan Trustee Services Bank,Ltd. (Trust Account)
6.29
The Master Trust Bank of Japan,Ltd.
(Number of Retirement Allowance Trust Shares
3.86
of Mitsubishi Chemical Corporation)
Nippon Life Insurance Company
2.34
Japan Trustee Services Bank,Ltd. (Trust Account 9)
2.20
The Chase Manhattan Bank 385036
2.17Mizuho Corporate Bank,Ltd.
2.00
Meiji Yasuda Life Insurance Company
1.58
Kyowa Hakko Kirin Co.,Ltd.
1.49

40,866
16,31816,082
9,888
5,998
5,622
5,546
5,125
4,034
3,821

* 11,650,235 shares of treasury stock held by the Company are not included in theabove breakdown of major shareholders.

1st quarter2nd quarter3rd quarter

4th quarter

1,135
856
1,477
1,141
2,520
1,892
2,395
2,000
3,710
2,535
2,985
2,540
2,460
2,000
1,687
1,162

1,033
780
2,080
1,429
2,180
1,655
2,635
2,175
2,930
2,280
3,120
2,445
2,180
1,246
1,960
1,561

1,238
900
2,540
1,795
2,265
1,790
3,150
2,370
3,170
2,505
3,020
2,465
1,397
795
1,959
1,545

1,282
1,109
2,435
2,055
2,255
2,040
3,810
3,040
3,240
2,530
2,875
1,886
1,312
990
1,974
1,714

High
FY2003Low
High
FY2004Low
High
FY2005Low
High
FY2006Low
High
FY2007Low
High
FY2008Low
High
FY2009Low
High
FY2010Low

Stock Listing
Tokyo Stock Exchange, Osaka Securities Exchange

Composition of Shareholders
Shareholders by category

NumberShares held
(thousands)

Individuals and Others
Foreign Corporation and Individuals
Other Domestic Corporations
Financial Institutions
Securities Companies
Total

21,092
403
292
93
47
21,92728,59864,204
59,210102,460
1,411
255,885

Monthly Stock Price(As of May 31, 2010)
(Yen)

3,000

2,500

2,000

By type of shareholders
ForeignInvestors

25.09%

By number of shares held

Financial
Institutions& Securities
Companies

Less than 1
trading unit

1,000 trading
units or more

0.02%

90.49%

40.59%

1 trading unit
or more

1,500

1,000

4.19%
500

0

’08/4

Individuals/
OthersOther Domestic
Corporations

50 trading units
or more11.18%

23.14%

3.80%’08/10’09/4’09/10’10/5500 trading units
or more1.50%
1 trading unit: 100 Shares

ANNUAL REPORT 201051

JSR Corporation
Annual Report 2010

Shiodome Sumitomo Bldg.
1-9-2 Higashi-Shinbashi, Minato-ku, Tokyo
105-8640, Japan
Telephone:03-6218-3517
Facsimile:03-6218-3684

ANNUAL REPORT 2010
For the year ended March 31, 2010

This annual report was printed with vegetable-based ink on FSC-certified paper

Printed in Japan 10-07IM