Business Results for theThird Quarter of the Fiscal Year Ending
December 31, 2021 (Unaudited)

November 10, 2021
Kuraray Co., Ltd.

November 10, 2021
Kuraray Co., Ltd.

Consolidated Earnings Report for the Third Quarter of the Fiscal Year Ending December 31,
2021
Name of listed company:
Stock code:
Stock exchange listing:
URL:

Kuraray Co., Ltd.
3405
Tokyo, first section
https://www.kuraray.com/

Representative:
Title:
Name:
Contact:
Title:

Representative Director and President
Hitoshi Kawahara
Senior Manager, Corporate Communications Department, Corporate Management
Planning Office
Shinichi Takizawa+81-3-6701-1070

Name:
Tel:

Preparation of supplementary documentation for the quarterly earnings report: Yes
Holding of quarterly earnings results briefing: Yes (for securities analysts and institutional investors)(Millions of yen rounded down unless otherwise stated)

1. Consolidated Financial Results for the Third Quarter of the Fiscal Year Ending December
31, 2021 (January 1, 2020 to September 30, 2021)(1) Consolidated Operating Results(Percentage changes displayed for net sales, operating income, ordinary income and net income attributable to owners of theparent are comparisons with the corresponding period of the previous fiscal year.)(Millions of yen)
Net Sales

Fiscal 2021 3Q
Fiscal 2020 3Q

Operating Income
(%)
16.6
(8.2)

459,159
393,778

Note: Comprehensive income:

(%)
67.0
(23.2)

51,001
29,823(%)
71.0(21.4)For the fiscal 2021 third quarter: ¥56,553 million (－%)
For the fiscal 2020 third quarter: ¥2,525 million (41.4%)

Net Income per
Share (Yen)
Fiscal 2021 3Q
Fiscal 2020 3Q

54,31832,527

Ordinary Income

83.15
44.05

Fully Diluted Net
Income per Share
(Yen)
83.08
44.01

(2) Consolidated Financial Position(Millions of yen)
As of September 30, 2021
As of December 31, 2020

Total Assets
1,062,197
1,051,584

Net Assets
559,519
515,481

Equity Ratio (%)
51.0
47.4

[Reference] Equity attributable to owners of the parent: As of September 30, 2021: ¥541,301 million
As of December 31, 2020: ¥498,798 million

Net Income Attributableto Owners of the Parent
28,602
15,147(%)
88.8(21.8)

2. Dividends
Record Date
Fiscal 2020
Fiscal 2021
Fiscal 2021
(Forecast)(Yen)
Mar. 31――

Cash Dividends per ShareJun. 30
Sep. 30
Dec. 31
21.00
―
19.00
20.00
―

Annual
40.00

20.00

40.00

Note: Revisions to cash dividend forecast during this period: No

3. Forecasts of Consolidated Financial Results for the Fiscal Year Ending December 31, 2021
(January 1, 2021 to December 31, 2021)(Percentage changes displayed for net sales, operating income, ordinary income and net income attributable to owners of theparent are comparisons with the corresponding period of the previous fiscal year.)(Millions of yen)
Net Sales

Full Fiscal Year

615,000

Operating Income
(%)
13.5

70,000(%)
57.9

Ordinary Income

65,000Net Income Attributable Net Income per
to Owners of the Parent
Share (Yen)
(%)
(%)
63.6
35,000―101.74

Note: Revisions to forecasts of consolidated financial results during this period: Yes[Reference](1) Changes in Important Subsidiaries during the Period (Changes in Special Subsidiaries
Involving Changes in the Scope of Consolidation)
Added: No companies

Excluded: No companies(2) Adoption of Special Accounting Practices in the Preparation of Quarterly Consolidated
Financial Statements
No(3) Changes in Accounting Principles, Procedures and Presentation Methods in Connection
with the Preparation of Quarterly Consolidated Financial Statements
1. Changes following revision of accounting standards: No
2. Changes besides 1. above: No
3. Changes in accounting estimates: No
4. Restatement: No(4) Number of Shares Issued and Outstanding (Common Shares)
1.

Number of shares issued and outstanding (including treasury stock) as of the period-end:
As of September 30, 2021
354,863,603 shares
As of December 31, 2020
354,863,603 shares

2.

Number of treasury shares as of the period-end:
As of September 30, 2021
10,857,820 shares
As of December 31, 2020
10,940,270 shares

3.

Average number of shares for the period (cumulative):
As of September 30, 2021
343,980,899 shares
As of September 30, 2020
343,865,009 shares

Note: It is not required that this type of earnings report be audited.
Cautionary Statement with Respect to Forecasts of Consolidated Business Results(Cautionary note regarding forward-looking statements)
The results forecasts presented in this document are based upon currently available information andassumptions deemed rational. A variety of factors could cause actual results to differ materially fromforecasts. Please refer to “(3) Basis for the Revision in Forecasts, Including Consolidated Operating
Results Forecasts” on page 6 of the Attachment for the assumptions used.

Index of the Attachment
1. Qualitative Information regarding Business Results ..............................................................................

2(1) Overview of Consolidated Business Results ........................................................................................

2(2) Overview of Financial Position ..............................................................................................................

5(3) Basis for the Revision in Forecasts, Including Consolidated Operating Results Forecasts .........

6

2. Quarterly Consolidated Financial Statements and Notes ......................................................................

7(1) Quarterly Consolidated Balance Sheets .................................................................................................

7(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements ofComprehensive Income ...........................................................................................................................

9(3) Notes regarding Quarterly Consolidated Financial Statements ........................................................

12

Notes regarding Going Concern Assumptions ....................................................................................

12

Material Changes in Shareholders’ Equity ............................................................................................

12

Segment Information, etc. .......................................................................................................................

121

1. Qualitative Information regarding Business Results(1) Overview of Consolidated Business Results
In the third quarter of fiscal 2021 (January 1, 2021–September 30, 2021), the world
economy recovered overall as COVID-19 vaccinations rates continued to rise andeconomic activities have been invigorated, particularly in advanced countries and China.
However, the outlook is currently growing more unclear due mainly to a continued rise in
raw material and fuel prices in addition to shortages of semiconductors and othercomponents, prolonged logistics disruptions, and concerns about an economic slowdown
in China. Consequently, consolidated operating results for the third quarter of fiscal 2021
are as follows: net sales rose ¥65,380 million, or 16.6%, compared with the previous fiscal
year to ¥459,159 million; operating income increased ¥21,790 million, or 67.0%, to¥54,318 million; ordinary income increased ¥21,178 million, or 71.0%, to ¥51,001 million;
and net income attributable to owners of the parent increased ¥13,455 million, or 88.8%,
to ¥28,602 million.
The Group’s long-term vision for its 100th anniversary coming up in 2026, “Kuraray
Vision 2026”, is to become a “Specialty Chemical Company, growing sustainably byincorporating new foundational platforms into its own technologies.” We will continue
striving to optimize our business portfolio by steadily taking specific measures based on thethree basic policies of “Kuraray Vision 2026”: pursuing competitive superiority, expanding
new business fields and enhancing the comprehensive strengths of the Kuraray Group. In
fiscal 2021, we will focus on safe and stable operations amid the pandemic and thoroughly
implement various measures decided on during the period of the previous medium-term
management plan “PROUD 2020.” At the same time, we will move ahead with formulating
the next medium-term management plan, which is set to start in fiscal 2022.
(Millions of yen)

Vinyl Acetate
Isoprene
Functional
Materials
Fibers andTextilesTrading
OthersElimination &Corporate
Total

FY2020 3Q
Net Sales Operating
Income186,759
27,99636,1432,130

FY2021 3Q
Net Sales Operating
Income224,861
42,92645,480
4,747

ChangeNet Sales Operating
Income38,101
14,9309,337
2,616

90,675

2,891

99,685

5,287

9,010

2,395

40,0202,703

44,779

4,314

4,759

1,611

89,322
32,051

2,817
347

105,301
33,802

3,570
644

15,979
1,751

753
296

(81,192)(6,358)(94,752)(7,172)(13,559)(814)

393,778

32,527459,159

54,31865,38021,790Results by Business Segment
Vinyl Acetate
Sales in this segment increased 20.4% year on year to ¥224,861 million, and segment
income rose 53.3% year on year to ¥42,926 million.
2(1) Sales of PVA resin increased for a wide range of applications as global demand has
been recovering, but performance was impacted by high raw material and fuel prices.
Sales of optical-use poval film were brisk against a backdrop of robust demand for
LCD panels continuing from the second half of the previous fiscal year. The sales
volume of PVB film rose year on year but were affected by a decrease in the
production of automobiles caused by a shortage of semiconductors in the third
quarter. Sales of water-soluble PVA film steadily expanded for use in unit dose
detergent packets, including for laundry and dish detergents.
(2) The sales volume of EVAL™ ethylene vinyl alcohol copolymer (EVOH resin)increased due to a recovery in demand for gas tank applications and solid demand forfood packaging applications but were affected by a decrease in the production of
automobiles and high raw material and fuel prices in the third quarter.
Isoprene
Sales in this segment increased 25.8% year on year to ¥45,480 million, and segment income
rose 122.8% year on year to ¥4,747 million.

(1) The sales volume of isoprene chemicals and SEPTON™ thermoplastic elastomer
increased due to a recovery in demand.
(2) Sales of GENESTAR™ heat-resistant polyamide resin remained brisk as demand forelectric and electronic device applications and automotive applications increased.
Functional Materials
3Sales in this segment increased 9.9% year on year to ¥99,685 million, and segment income
rose 82.2% year on year to ¥5,287 million.

(1) In the methacrylate business, sales of spatter-blocking barrier panels and displays
remained steady, and market conditions stayed strong.
(2) In the medical business, demand for new Kuraray products was strong in the dental
materials business, and sales were particularly brisk in Europe and the United States.
(3) In the environmental solutions business, demand for industrial application products
recovered, and sales of activated carbon remained steady.
Fibers and Textiles
Sales in this segment rose 11.9% year on year to ¥44,779 million while segment income
increased 59.6% year on year to ¥4,314 million.

(1) Sales of CLARINO™ man-made leather remained brisk as demand for use in shoes andluxury products recovered.
(2) In fibers and industrial materials, the sales volume of KURALON™ remained brisk as
demand for cement reinforcement and rubber materials recovered.
(3) In consumer goods and materials, demand for KURAFLEX™ for use in counter
cloths for the restaurant industry was weak.
Trading
In fiber-related businesses, sales for sports applications were brisk. Sales of resins and4chemicals expanded in Japan and Asia, including China. As a result, segment sales increased
17.9% year on year to ¥105,301 million, and segment income rose 26.7% to ¥3,570
million.

OthersIn other business, due to signs of recovery in sales of domestic affiliates, segment sales
increased 5.5% year on year to ¥33,802 million, and segment income rose 85.5% to ¥644
million.

(2) Overview of Financial Position
Total assets increased ¥10,612 million from the end of the previous fiscal year to ¥1,062,197
million mainly because of a ¥17,409 million increase in inventories, a ¥13,317 million
increase in construction in progress, a ¥9,771 million increase in notes and accounts
receivable—trade, and a ¥5,129 million increase in other current assets accompanying mainly
an increase in other accounts receivable, despite a ¥37,400 million decrease in cash and cash
deposits and a ¥5,640 million decrease in short-term investment securities. Factors that
contributed to liabilities included a net increase in long-term loans payable of ¥4,850 million
along with rises of ¥4,365 million in income taxes payable, ¥4,237 million in notes andaccounts payable—trade, and ¥3,508 million in provision for bonuses. Total liabilities
decreased ¥33,425 million to ¥502,677 million due to factors that included a ¥21,932 million
decrease in other current liabilities accompanying mainly a decrease in other accounts payable,
the redemption of commercial paper totaling ¥20,000 million, and the redemption of bonds
totaling ¥10,000 million.
Total net assets rose ¥44,038 million to ¥559,519 million. Equity attributable to owners of
the parent amounted to ¥541,301 million, for an equity ratio of 51.0%.
5

(3) Basis for the Revision in Forecasts, Including Consolidated Operating Results
Forecasts
In light of the most recent trend in its operating results, the Company has revised theforecast of consolidated operating results for the fiscal year ending December 31, 2021
(January 1, 2021 to December 31, 2021) from its previous forecast announced on August
12, 2021, as shown below.
Revised Consolidated Operating Results Forecast for Fiscal 2021

Net Sales
Original Forecast (A)Revised Forecast (B)Amount Adjusted (B − A)
Percent Adjusted
Ref: FY2020 Results

610,000
615,000
5,000
0.8
541,797

Operating
Income66,00070,0004,000
6.1
44,341(Millions of yen)
Net Income
Ordinary
Attributable
Incometo Ownersof the Parent
61,00033,00065,00035,000
4,000
2,000
6.6
6.1
39,740
2,570

(Yen)

Net Income
Per Share
95.93
101.74

Note: The above forecasts are based on the best information currently available. Actual
operating results may vary significantly due to various factors.

6

7.48

2. Quarterly Consolidated Financial Statements and Notes(1) Quarterly Consolidated Balance Sheets(Millions of yen)
ASSETS
Current Assets
Cash and cash deposits
Notes and accounts receivable–trade
Short-term investment securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Noncurrent Assets
Tangible fixed assets
Buildings and structures, net
Machinery, equipment and vehicles, net
LandConstruction in progress
Other, net
Total tangible fixed assets
Intangible fixed assets
Goodwill
Customer-related assets
Other
Total intangible fixed assets
Investments and other assets
Investment securities
Long-term loans receivable
Net defined benefit assets
Deferred tax assets
OthersAllowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total Assets

7

December 31, 2020

September 30, 2021

184,319
117,172
7,924
86,555
14,10531,96819,596(439)
461,202

146,918
126,943
2,284
95,082
15,64739,30824,725(487)
450,422

84,604200,152
22,20497,451
24,978429,391

86,430200,738
22,518110,768
24,894445,349

51,10528,80031,143111,049

52,21829,071
31,731
113,02125,477140
2,097
14,652
7,597(24)
49,941
590,382
1,051,584

25,624121
2,366
15,7889,526(24)53,403611,774
1,062,197

(Millions of yen)
LIABILITIESCurrent Liabilities
Notes and accounts payable–trade
Short-term loans payable
Commercial paper
Current portion of bonds payable
Current portion of long-term loans payable
Accrued expenses
Income taxes payable
Provision for bonuses
Other provision
Other
Total current liabilities
Noncurrent Liabilities
Bonds payable
Long-term loans payable
Deferred tax liabilities
Provision for directors’ retirement benefits
Provision for environmental measures
Net defined benefit liabilities
Asset retirement obligations
Other
Total noncurrent liabilities
Total Liabilities
NET ASSETS
Shareholders’ Equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated Other Comprehensive Income
Valuation difference on available-for-sale securities
Deferred gain or losses on hedges
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Subscription Rights to Shares
Noncontrolling Interests
Total Net Assets
Total Liabilities and Net Assets
8

December 31, 2020

September 30, 2021

36,161
34,48020,00020,00029
17,956
6,621
6,745
202
52,856
195,053

40,39834,480－10,00055,01320,754
10,986
10,254207
30,924
213,01960,000206,881
11,218375
3,364
25,4494,383
29,376
341,050
536,103

60,000156,747
12,561
385
562
25,5794,494
29,327
289,658
502,677

88,95587,178336,050(16,006)
496,177

88,95587,166351,238(15,885)
511,475

6,847
(376)
1,470
(5,321)
2,620
328
16,354515,481
1,051,584

7,288
297
24,998(2,759)29,826414
17,803559,519
1,062,197

(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements ofComprehensive Income
Quarterly Consolidated Statements of Income(Millions of yen)
Fiscal 2020 3Q
Fiscal 2021 3Q(January 1, 2020 –(January 1, 2021 –September 30, 2020) September 30, 2021)
Net sales
393,778
459,159
Cost of sales
272,473
309,095
Gross profit
121,305
150,063
Selling, general and administrative expenses
Selling expenses
22,66627,949General and administrative expenses
66,111
67,796
Total selling, general and administrative expenses
88,777
95,745
Operating income
32,52754,318Non-operating income
Interest income
198
84
Dividend income
370
340
Equity in earnings of affiliates
142
189
Other
961
971
Total non-operating income
1,673
1,585
Non-operating expenses
Interest expenses
1,081
1,161
Foreign exchange loss
171
－
Other
3,123
3,740
Total non-operating expenses
4,377
4,902
Ordinary income
29,82351,001
Extraordinary income
Gain on sale of investment securities
787
535
Subsidy income－
510
Compensation for transfer－
422
Insurance income
391－
Gain on reversal of share acquisition rights to shares
285－
Total extraordinary income
1,464
1,468
Extraordinary loss
Loss on litigation
5,183
3,772
Disaster loss－
3,245
Loss on disposal of tangible fixed assets
571
1,151
Loss on tax purpose reduction entry of non-current－
423
assetsCosts related to the suspension of operations
3,249－
Total extraordinary loss
9,004
8,593
Income before income taxes and noncontrolling interests
22,28343,876
Income taxes—current
8,780
15,381
Income taxes—deferred(2,323)(1,025)
9

Total income taxes

6,457
Fiscal 2020 3Q(January 1, 2020 –September 30, 2020)
15,826679
15,147

Net income
Net income attributable to noncontrolling interests
Net income attributable to owners of the parent

10

14,356
Fiscal 2021 3Q(January 1, 2021 –September 30, 2021)
29,520917
28,602

Quarterly Consolidated Statements of Comprehensive Income(Millions of yen)

Net income
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total other comprehensive income
Quarterly comprehensive income
Comprehensive income attributable to:
Owners of the parent
Noncontrolling interests

11

Fiscal 2020 3Q(January 1, 2020 –September 30, 2020)
15,826

Fiscal 2021 3Q(January 1, 2021 –September 30, 2021)
29,520(2,015)(73)(11,612)399(13,300)
2,525

441
836
23,193
2,562
27,03356,5532,320
204

55,808745

(3) Notes regarding Quarterly Consolidated Financial Statements
Notes regarding Going Concern Assumptions
None
Material Changes in Shareholders’ Equity
None
Segment Information, etc.
● Segment Information
I. Third Quarter of Fiscal 2020 (January 1, 2020 to September 30, 2020)
1. Net sales, income and loss by reporting segment(Millions of yen)
Reporting Segment
Vinyl Isoprene Functional Fibers and Trading
AcetateMaterials Textiles

Net sales(1) Outside
156,675
customers(2) Intersegment
sales and
30,083transfers
Total
186,759
Segment income
27,996(loss)

Total

Other
Business1

Total Adjustment2 Consolidated
Statements3of Income

19,382

77,59330,33587,381 371,369

22,409 393,778

16,76013,081

9,684

1,940

9,641

36,14390,67540,02089,322 442,920

2,130

2,891

2,703

2,817

71,551
38,539－393,778

81,192(81,192)－

32,051 474,971(81,192)

393,778(6,358)32,527347

38,886

Notes:
1. The “Other Business” category incorporates operations not included in business segment
reporting, including the water treatment business and engineering business.
2. Adjustment is as follows: Included within segment loss of ¥6,358 million is the elimination ofintersegment transactions that ended as a profit of ¥1,448 million and corporate expenses that
ended as a loss of ¥7,807 million. Corporate expenses mainly comprise the submitting
company’s basic research expenses.
3. Segment income is adjusted to agree with operating income in the consolidated statements ofincome.

12II. Third Quarter of Fiscal 2021 (January 1, 2021 to September 30, 2021)
1. Net sales, income and loss by reporting segment(Millions of yen)
Reporting Segment
Vinyl Isoprene Functional Fibers and Trading
AcetateMaterials Textiles

Net sales(1) Outside
187,077
customers(2) Intersegment
sales and
37,783transfers
Total
224,861
Segment income
42,926(loss)

Total

Other
Business1

Total

23,964

84,68433,659 103,362 432,748

26,410 459,159

21,51615,001

11,1197,391

45,48099,68544,779 105,301 520,109

4,747

5,287

4,314

1,939
3,570

87,36060,846

Adjustment Consolidated
2
Statements3of Income－

459,159

94,752(94,752)－

33,802 553,911(94,752)

459,159(7,172)54,318644

61,491

Notes:
1. The “Other Business” category incorporates operations not included in business segment
reporting, including the water treatment business and engineering business.
2. Adjustment is as follows: Included within segment loss of ¥7,172 million is the elimination ofintersegment transactions that ended as a profit of ¥1,238 million and corporate expenses that
ended as a loss ¥8,411 million. Corporate expenses mainly comprise the submitting company’s
basic research expenses.
3. Segment income is adjusted to agree with operating income in the consolidated statements ofincome.

13