Business Results for theThird Quarter of the Fiscal Year Ending
December 31, 2022 (Unaudited)

November 9, 2022
Kuraray Co., Ltd.

November 9, 2022
Kuraray Co., Ltd.

Consolidated Earnings Report for the Third Quarter of the Fiscal Year Ending
December 31, 2022
Name of listed company:
Stock code:
Stock exchange listing:
URL:

Kuraray Co., Ltd.
3405
Tokyo Stock Exchange, Prime Market
https://www.kuraray.com/

Representative:
Title:
Name:

Representative Director and President
Hitoshi Kawahara

Contact:
Title:

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, 2022 (January 1, 2022 to September 30, 2022)(1) Consolidated Operating Results(Percentage changes displayed for net sales, operating income, ordinary income and net income attributableto owners of the parent are comparisons with the corresponding period of the previous fiscal year.)(Millions of yen)
Net Sales

Operating Income(%)

Fiscal 2022 3Q
Fiscal 2021 3Q

553,150
459,159―

16.6

Note: Comprehensive income:Net Income per
Share (Yen)
Fiscal 2022 3Q
Fiscal 2021 3Q

139.64
83.15

Ordinary Income(%)

70,84654,318―67.0

For the fiscal 2022 third quarter:
For the fiscal 2021 third quarter:

70,07851,001

―

(%)

71.0

Net Income
Attributable to Ownersof the Parent(%)―
47,17488.8
28,602¥137,969 million¥56,553 million

(―%)
(―%)

Fully Diluted Net
Income per Share(Yen)
139.5383.08

Note: Due to the adoption of the “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29;
March 31, 2020) from January 1, 2022, the figures for the third quarter of fiscal 2022 reflect the application of
the newly applied accounting standard. Therefore, the rate of change from the same quarter of the previous
year is not shown.

(2) Consolidated Financial Position(Millions of yen)
Total Assets
1,215,627
1,091,014

As of September 30, 2022
As of December 31, 2021

Net Assets
693,133
579,602

Equity Ratio (%)
55.2
51.3

[Reference] Equity attributable to owners of the parent:
As of September 30, 2022: ¥671,487 million
As of December 31, 2021: ¥559,984 million
Note: Due to the adoption of the “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29;
March 31, 2020) from January 1, 2022, the figures for the third quarter of fiscal 2022 reflect the application of
the newly applied accounting standard.

2. Dividends(Yen)
Record Date
Fiscal 2021
Fiscal 2022
Fiscal 2022
(Forecast)Mar. 31――

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

Annual
40.00

21.00

42.00

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

3. Forecasts of Consolidated Financial Results for the Fiscal Year Ending December
31, 2022 (January 1, 2022 to December 31, 2022)(Percentage changes displayed for net sales, operating income, ordinary income and net income attributableto owners of the parent are comparisons with the previous fiscal year.)(Millions of yen)
Net Sales

Full Fiscal Year760,000

Operating
Income― 78,000

Ordinary
Income― 75,000Net Income
Attributable to Ownersof the Parent―
48,000―Net Income
per Share(Yen)
143.41

Notes: 1. Revisions to forecasts of consolidated financial results during this period: Yes
2. Due to the adoption of the “Accounting Standard for Revenue Recognition” (ASBJ Statement No.
29; March 31, 2020) from January 1, 2022, the figures for fiscal 2022 reflect the application of the
newly applied accounting standard. Therefore, the rate of change from the previous fiscal year is
not shown.

[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: Yes
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 shares) as of the periodend:
As of September 30, 2022
354,863,603 sharesAs of December 31, 2021

354,863,603 shares

2.

Number of treasury shares as of the period-end:
As of September 30, 2022
20,170,573 shares
As of December 31, 2021
10,858,263 shares

3.

Average number of shares for the period (cumulative):
As of September 30, 2022
337,836,766 shares
As of September 30, 2021
343,980,899 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 from forecasts.
Please refer to “1. Qualitative Information regarding Business Results (3) Basis for the Revision in Forecasts,
Including Consolidated Operating Results Forecasts” on page 7 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 .................................................................................

6(3) Basis for the Revision in Forecasts, Including Consolidated Operating Results
Forecasts ..................................................................................................................

7

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

8(1) Quarterly Consolidated Balance Sheets...................................................................

8(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated
Statements of Comprehensive Income ....................................................................

10(3) Notes regarding Quarterly Consolidated Financial Statements ...............................

12

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

12

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

12

Changes in Accounting Principles ............................................................................

12

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

131

1. Qualitative Information regarding Business Results(1) Overview of Consolidated Business Results
In the third quarter of fiscal 2022 (January 1, 2022–September 30, 2022), theworld economy continued to gradually recover as restrictions on economic
activities were eased. However, the recent trend toward economic deceleration
grew stronger due in part to a rise in interest rates in various countries amid
rapid inflation and the prolonged Russia-Ukraine crisis, causing the future
outlook to become even murkier. Amid these circumstances, consolidated
operating results for the third quarter of fiscal 2022 are as follows: net sales
were ¥553,150 million (¥459,159 million in the same period of the previous
fiscal year); operating income was ¥70,846 million (¥54,318 million in the same
period of the previous fiscal year); ordinary income was ¥70,078 million(¥51,001 million in the same period of the previous fiscal year); and net income
attributable to owners of the parent was ¥47,174 million (¥28,602 million in thesame period of the previous fiscal year). Furthermore, in the third quarter, werecorded an extraordinary loss of ¥5,429 million as costs related to thesuspension of operations due mainly to the suspension of some production
facilities at a U.S. subsidiary.
On January 1, 2022, the Company revised its organizational structure andchanged the segment classification of the aqua business from “Others” to“Functional Materials.” In addition, the method of allocating eliminations ofprofits from some internal transactions among segments and the corporate has
been changed. Figures used in comparisons and analyses of the third quarterreflect these changes. Furthermore, from January 1, 2022, we have adopted the
Accounting Standard for Revenue Recognition (ASBJ Statement No. 29; March
31, 2020). In line with the transition provisions set out in the revision toparagraph 84, the new accounting principle was not retroactively applied to theconsolidated third quarter of the previous fiscal year. Net sales for the Trading
segment and elimination & corporate for the third quarter of fiscal 2022 havesignificantly changed compared to the third quarter of fiscal 2021, mainly due tochanges in accounting methods for revenues attributable to agent transactionsin the Trading segment as a result of the adoption of the Accounting Standard
for Revenue Recognition and other factors. Because of these changes,
revenues from such transactions, which have previously been recorded on thebasis of total transactional value, are now recorded on a net basis. Due to thischange, net sales in the Trading segment was ¥63,010 million lower comparedwith the original method.
To realize its long-term vision, Kuraray Vision 2026, the Group launched a
medium-term management plan, “PASSION 2026,” from January 1, 2022. Inline with “PASSION 2026,” we set three challenges to tackle: 1) Sustainability
as an opportunity, 2) Innovations starting from networking, and 3)
Transformation of people and organizations. Through these initiatives, we aim
to establish an upgraded business portfolio and, in fiscal 2026, the centennial ofKuraray’s founding, achieve net sales of ¥750.0 billion and operating income of¥100.0 billion.
2

(Millions of yen)
Fiscal 2021 3Q
Net sales

OperatingincomeFiscal 2022 3Q
Net sales

ChangeOperatingincomeNet sales

OperatingincomeVinyl Acetate

224,861

43,775

285,641

58,98760,78015,212Isoprene

45,4805,042

48,717

4,145

3,236

(897)

Functional

101,878

5,414

123,720

6,493

21,842

1,078

44,7794,583

48,630

6,580

3,850

1,996

Trading

105,301

3,565

43,778

3,926(61,523)

361

Others31,609

1,007

37,633

1,938

6,024

931

(94,752)(9,071)(34,972)(11,226)

59,779(2,154)459,159

54,318553,150

70,84693,99016,527

Materials
Fibers andTextilesElimination &Corporate
Total

Results by Business Segment
Vinyl Acetate
Sales in this segment were ¥285,641 million (¥224,861 million in the same
period of the previous fiscal year), and segment income was ¥58,987 million(¥43,775 million in the same period of the previous fiscal year).

(1) The sales volume of PVOH resin decreased due to the suspension of someproduction facilities at a U.S. subsidiary because of malfunctions andlogistics disruptions. On the other hand, we continued revising prices amidsoaring raw material and fuel prices. Shipments of optical-use poval film
declined significantly in the July–September 2022 period due to the impact
of LCD panel inventory adjustments. In addition, to meet needs for larger
TV panel sizes, we decided to make a capital investment at the Kurashiki
Plant (slated to begin operating in mid 2024), announcing this intention on
May 9, 2022. As for Advanced Interlayer Solutions, the sales of PVB film foruse in construction applications held steady. Sales of water-soluble PVOH
film were firm for use in unit dose laundry detergent packets.
(2) As for EVAL™ ethylene vinyl alcohol copolymer (EVOH resin), the sales
volume increased as steady performance for use in food packaging
3

applications offset a decrease for use in automotive applications. We also
revised prices.
Isoprene
Sales in this segment were ¥48,717 million (¥45,480 million in the same periodof the previous fiscal year), and segment income was ¥4,145 million (¥5,042
million in the same period of the previous fiscal year).

(1) Amid soaring raw material and fuel prices, we revised prices of isoprenechemicals and elastomer. Nevertheless, the sales volume decreased due toa temporary difficulty in procuring raw materials and lockdowns in China.
(2) The sales volume of GENESTAR™ heat-resistant polyamide resin
decreased due in part to a decrease in automotive production and inventory
adjustments in electric and electronic devices.
Functional Materials
Sales in this segment were ¥123,720 million (¥101,878 million in the same
period of the previous fiscal year), and segment income was ¥6,493 million(¥5,414 million in the same period of the previous fiscal year).

(1) In the methacrylate business, the sales volume decreased due in part toelectric and electronic device inventory adjustments.
(2) In the medical business, sales of dental materials expanded in Japan andoverseas.
(3) In the environmental solutions business, demand increased, especially in4Europe, and sales of activated carbon expanded.
(4) In the aqua business, demand for hollow fiber membranes for water
treatment remained steady.
Fibers and Textiles
Sales in this segment were ¥48,630 million (¥44,779 million in the same periodof the previous fiscal year), and segment income was ¥6,580 million (¥4,583
million in the same period of the previous fiscal year).

(1) Sales of CLARINO™ man-made leather remained steady, especially for use
in luxury products.
(2) In fibers and industrial materials, KURALON™ was affected by a decreasein the production of automobiles, while sales of VECTRAN™ werefavorable, especially for exports.
(3) In consumer goods and materials, demand for KURAFLEX™ in therestaurant industry was weak.
Trading
Sales in this segment were ¥43,778 million (¥105,301 million in the same periodof the previous fiscal year), and segment income was ¥3,926 million (¥3,565
million in same period of the previous fiscal year). In comparison with theprevious methods, net sales decreased ¥63,010 million due to the adoption of
the Accounting Standard for Revenue Recognition and other factors.

5(1) In fiber-related businesses, sales of sportswear and other products were brisk.
(2) Although sales of resins and chemicals had been brisk in the Asian market
until the end of the April–June 2022 period, demand retreated in the July–
September 2022 period.
OthersIn Others, domestic affiliates saw sales recover. As a result, segment sales
were ¥37,633 million (¥31,609 million in the same period of the previous fiscal
year), and segment income was ¥1,938 million (¥1,007 million in the same
period of the previous fiscal year).

(2) Overview of Financial Position
Total assets increased ¥124,612 million from the end of the previous fiscal yearto ¥1,215,627 million mainly because of a ¥84,003 million increase in inventories,a ¥39,346 million increase in construction in progress, a ¥20,823 million increasein notes and accounts receivable–trade, and contract assets (notes and accounts
receivable–trade in the previous fiscal year), and a ¥10,299 million increase inmachinery, equipment and vehicles, net despite a ¥63,018 million decrease in
cash and deposits.
Total liabilities increased ¥11,082 million to ¥522,493 million due to factors that
included the issuance of ¥20,000 million in commercial paper and ¥10,000 million
in bonds payable despite a ¥38,275 million decrease in current portion of longterm borrowings.
Net assets rose ¥113,530 million to ¥693,133 million. Equity attributable toowners of the parent amounted to ¥671,487 million, for an equity ratio of 55.2%.

6

(3) Basis for the Revision in Forecasts, Including Consolidated Operating
Results Forecasts
Reflecting the Company’s business performance for the third quarter of fiscal
2022 as well as the business environment, foreign exchange rates, and raw
material and fuel prices, the forecast of consolidated operating results for thefull fiscal 2022 (January 1, 2022 to December 31, 2022), which was announced
on August 10, 2022, is revised as follows.
Revised Consolidated Operating Results Forecast for Fiscal 2022
(Millions of yen)
Net Income
Net Operating Ordinary
Attributable toSales Income Income
Owners of the Parent
Previous Forecast (A)740,000
78,00075,00045,000
Revised Forecast (B)760,000
78,00075,00048,000
Amount Adjusted (B − A) 20,000
―
―
3,000
Percent Adjusted
2.7%
―
―
6.7%
(Ref.)
629,370
72,256
68,76537,262
Fiscal 2021 results(Yen)

Net Income
Per Share
134.45143.41

108.32

Figures for fiscal 2021 are presented without applying the “Accounting Standard
for Revenue Recognition” (ASBJ Statement No. 29; March 31, 2020).
Note: The above forecasts are based on the best information currently
available. Actual operating results may vary significantly due to various
factors.

7

2. Quarterly Consolidated Financial Statements and Notes(1) Quarterly Consolidated Balance Sheets(Millions of yen)

December 31, 2021

September 30, 2022

Cash and deposits
Notes and accounts receivable–trade
Notes and accounts receivable–trade, andcontract assets

151,942
135,768

88,923――

156,592

Securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Other

3,855
103,505
15,69938,100

4,335
162,241
21,946
57,122

21,745(443)

23,683ASSETS
Current Assets

470,174(517)
514,327

88,801
200,500
22,648117,319
25,997

94,647
210,799
23,572
156,666
27,793455,266

513,478

Goodwill
Customer-related assets
Other

52,63529,17632,243

61,97734,017
37,119Total intangible assets

114,055

133,114

25,689121
3,066
13,9808,686(26)51,517620,839
1,091,014

23,121
108
3,491
16,433
11,578(26)
54,707
701,300
1,215,627

Allowance for doubtful accounts
Total current assets
Non-current Assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
LandConstruction in progress
Other, net
Total property, plant, and equipment
Intangible assets

Investments and other assets
Investment securities
Long-term loans receivable
Retirement benefit asset
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total Assets

8

(Millions of yen)
December 31, 2021

September 30, 2022

49,641
34,480――55,013
19,863
13,133
7,996
89
39,246
219,464

52,65834,48020,00010,00027,08824,17910,476
10,844124
42,035
231,887

60,000157,945
12,02260,000147,594
13,860

375

344

365
25,6294,821
30,787
291,947
511,411398
28,221
5,153
35,033
290,606
522,493

88,95587,166359,898(15,885)
520,134

88,95587,152392,777(25,735)
543,150

7,273
219
34,648(2,291)
39,850414
19,203579,602
1,091,014

5,326
1,375
123,197(1,563)
128,337341
21,305
693,133
1,215,627

LIABILITIESCurrent Liabilities
Notes and accounts payable–trade
Short-term borrowings
Commercial paper
Current portion of bonds payable
Current portion of long-term borrowings
Accrued expenses
Income taxes payable
Provision for bonuses
Other provisions
Other
Total current liabilities
Non-current Liabilities
Bonds payable
Long-term borrowings
Deferred tax liabilities
Provision for retirement benefits for directors (andother officers)
Provision for environmental measures
Retirement benefit liability
Asset retirement obligations
Other
Total non-current liabilities
Total Liabilities
NET ASSETS
Shareholders’ Equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated Other Comprehensive Income
Valuation difference on available-for-sale securities
Deferred gain or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Share Acquisition Rights
Non-controlling Interests
Total Net Assets
Total Liabilities and Net Assets

9(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated
Statements of Comprehensive Income
Quarterly Consolidated Statements of Income(Millions of yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Selling expenses
General and administrative expenses
Total selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Share of profit of entities accounted for using equity
methodOther
Total non-operating income
Non-operating expenses
Interest expenses
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sale of investment securities
Insurance claim income
Subsidy income
Compensation for transfer
Total extraordinary income
Extraordinary losses
Costs related to the suspension of operations
Loss on litigation
Loss on disposal of non-current assets
Loss on disaster
Loss on tax purpose reduction entry
Total extraordinary losses
Income before income taxes and non-controllinginterests
Income taxes—current
Income taxes—deferred
Total income taxes
Net income
Net income attributable to non-controlling interests
Net income attributable to owners of the parent

10

Fiscal 2021 3Q(January 1, 2021 –September 30, 2021)
459,159
309,095
150,063

Fiscal 2022 3Q(January 1, 2022 –September 30, 2022)
553,150
369,455
183,694

27,94967,796
95,74554,31834,43678,412
112,848
70,846

84
340

201
388

189

210

971
1,585

2,191
2,992

1,161
3,740
4,902
51,001

1,063
2,696
3,760
70,078

535
―
510
422
1,468

2,510
1,178
―
―
3,689

―
3,772
1,151
3,245
423
8,593

5,429
1,714
275
―
―
7,419

43,876

66,347

15,381(1,025)
14,35629,520917
28,602

21,330(3,195)
18,135
48,212
1,037
47,174

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, net of tax
Total other comprehensive income
Quarterly comprehensive income
Comprehensive income attributable to:
Owners of the parent
Non-controlling interests

11

Fiscal 2021 3Q(January 1, 2021 –September 30, 2021)
29,520Fiscal 2022 3Q(January 1, 2022 –September 30, 2022)
48,212441
836
23,193
2,562
27,03356,553(1,946)
1,510
89,465728
89,757
137,969

55,808745

135,661
2,308

(3) Notes regarding Quarterly Consolidated Financial Statements
Notes regarding Going Concern Assumptions
None
Material Changes in Shareholders’ Equity
At the Board of Directors meeting held on February 9, 2022, Kuraray resolved to undertakea share buyback, and has acquired 9,424 thousand shares, amounting to ¥9,999 million. As
a result, treasury shares increased ¥9,849 million in the third quarter and totaled ¥25,735
million as of September 30, 2022.
Changes in Accounting Principles
Adoption of Accounting Standard for Revenue Recognition
Kuraray has adopted the Accounting Standard for Revenue Recognition (ASBJ Statement
No. 29, March 31, 2020) from January 1, 2022, and recognizes revenue for goods orservices based on the amount estimated to be received in exchange for such goods orservices at the point when control of the promised goods or services is transferred to thecustomer.
The main changes resulting from the adoption of the standards are as follows.
(1) In supply transactions with repurchase obligations, we changed the method by which
the elimination of supplied goods is not recognized and changed the method by which
liabilities related to supply transactions regarding consideration received fromsuppliers are recognized.
(2) In contracts with customers that include a variable consideration among theirconsiderations, when the uncertainty related to the amount of the variableconsideration is eventually eliminated (restricted to portions that have a highprobability of not generating a significant drop in revenue until the uncertainty iseliminated), the variable consideration is included in the transaction price. In addition,a portion of such variable considerations was formerly presented under selling,
general and administrative expenses, however, the presentation method has beenchanged so that it is now presented after being excluded from net sales.
(3) Regarding transactions where the role of providing products or goods corresponds tothat of an agent, we have changed the previous method of recognizing the total
consideration received from the customer as revenue to a method in which we
recognize the net amount received from the customer, excluding the amount paid tothe buyer, as revenue.
Regarding the adoption of the revenue recognition standards, in line with the transition
provisions set out in the revision to paragraph 84, the cumulative effect of retroactively
applying the new accounting principle before January 1, 2022, is added or subtracted toretained earnings as of January 1, 2022, and the new accounting principle is adopted fromJanuary 1, 2022.
As a result, net sales in the third quarter decreased ¥3,422 million. The effect on operating
income, ordinary income, and income before income taxes and non-controlling interests
was minimal. In addition, the balance of retained earnings as of January 1, 2022,
decreased ¥388 million.
12

Because we adopted the revenue recognition standards, in the consolidated balance sheet
for the previous fiscal year, “notes and accounts receivable–trade” previously presented
under current assets is included in “notes and accounts receivable–trade and contract
assets” from January 1, 2022. Furthermore, in line with the transition provisions set out inParagraph 89-2 of the revenue recognition standard, we have not revised the presentation
method for the previous fiscal year.
Adoption of Accounting Standard for Fair Value Measurement
Kuraray has adopted the Accounting Standard for Fair Value Measurement (ASBJ
Statement No. 30, July 4, 2019) from January 1, 2022. The Company has prospectively
adopted new accounting policies based on the Accounting Standard for Fair Value
Measurement in accordance with the transition provisions in Paragraph 19 of the
Accounting Standard for Fair Value Measurement and Paragraph 44-2 of the AccountingStandard for Financial Instruments (ASBJ Statement No. 10, July 4, 2019). These changes
have no impact on quarterly financial statements.
Segment Information, etc.
● Segment Information
I. 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
AcetateMaterials
Net sales(1) Outside
187,077
customers(2) Intersegment
sales and
37,783transfers
Total
224,861
Segment income
43,775(loss)

Others1

FibersandTextilesTrading

Total

Adjustment2 Consolidated
Statements
3of IncomeTotal

23,96485,46333,659 103,362 433,527

25,631 459,159—

459,159

21,516

16,415

11,1191,939 88,774

5,977 94,752(94,752)—

45,480101,878

44,779 105,301 522,302

31,609 553,911(94,752)

459,159

5,042

5,414

4,583

1,007 63,389(9,071)

54,3183,565 62,382

Notes:
1. The “Others” category incorporates operations not included in business segment
reporting, including the engineering business.
2. Adjustment is as follows: Included within segment loss of ¥9,071 million is theelimination of intersegment transactions of ¥660 million and corporate expenses of¥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 of income.

13

II. Third Quarter of Fiscal 2022 (January 1, 2022 to September 30, 2022)
1. Net sales, income and loss by reporting segment(Millions of yen)
Reporting Segment
Vinyl Isoprene Functional
AcetateMaterials

Net sales(3) Outside
274,196
customers(4) Intersegment
sales and
11,445transfers
Total
285,641
Segment income 58,987(loss)

38,725

121,016

9,991

2,703

48,717

123,720

4,145

6,493

FibersandTextilesOthers1
Trading

Total

Adjustment2 Consolidated
Statements
3of IncomeTotal

45,943 42,537 522,420

30,730 553,150—

553,1502,686

1,240 28,068

6,903 34,972(34,972)—

48,630 43,778 550,488

37,633 588,122(34,972)

553,150

6,580

1,938 82,072(11,226)

70,846

3,926 80,133

Notes:
1. The “Others” category incorporates operations not included in business segment
reporting, including the engineering business.
2. Adjustment is as follows: Included within segment loss of ¥11,226 million is theelimination of intersegment transactions of ¥1,338 million and corporate expenses of¥9,887 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 of income.
2. Matters related to changes in reporting segments
Changes in methods for estimating net sales and profit for reporting segments
As detailed in changes to accounting principles, because we adopted revenue recognition
standards from January 1, 2022, and changed the accounting treatment method related torevenue recognition, the method for estimating the net sales and profit of businesssegments changed accordingly. Due to these changes, in comparison with previous
methods, net sales to outside customers in the third quarter increased ¥26,581 million in
Vinyl Acetate, increased ¥7,352 million in Isoprene, increased ¥14,762 million in Functional
Materials, increased ¥8,022 million in Fibers and Textiles, decreased ¥60,767 million in
Trading, and increased ¥625 million in Others.
In addition, intersegment net sales or transfers decreased ¥27,604 million in Vinyl Acetate,decreased ¥8,280 million in Isoprene, decreased ¥14,918 million in Functional Materials,
decreased ¥8,650 million in Fibers and Textiles, decreased ¥2,243 million in Trading, anddecreased ¥736 million in Others, and adjustments increased ¥62,433 million.
The impact on segment income was minimal.
Furthermore, from January 1, 2022, regarding the elimination of some intersegment
transaction profit, we changed the method for allocating it to each segment and theCompany. Segment information in the third quarter of the previous fiscal year is presented
based on the changed allocation method.

14

Changes in reporting segments
Following the revision to our organizational structure, from January 1, 2022, the aquabusiness was transferred from Others to Functional Materials. Furthermore, the segment
information for the third quarter of the previous fiscal year is presented based on thechanged reporting segments.

15