Financial Results for the Fiscal Year ended March 31, 2021
(Japan GAAP)May 12, 2021
Company name:

HANWA Co.,Ltd.

Listed stock exchange: Tokyo

Stock exchange code:

8078(URL http://www.hanwa.co.jp)

Representative:
Hironari Furukawa President
Enquiries:
Yoichi Nakagawa Director, Senior Managing Executive Officer
Scheduled date of Shareholders' Meeting:Jun 23, 2021
Scheduled date of issue of audited financial statements: Jun 24, 2021
Scheduled date of payout of dividend:
Jun 24, 2021

Phone +81-3-3544-2000(Amounts less than one million yen are rounded down)

１．Consolidated financial results for the Fiscal Year ended March 31, 2021 (April 1, 2020 to March 31, 2021)(1) Consolidated operating results（Percentage indicate a change from the previous year）
Net sales
Fiscal Year
ended March 31, 2021
ended March 31, 2020

Operating income(Millions of yen)(％)

(Millions of yen)(％)

(Millions of yen)

1,745,501(8.5)
29,2327.0
1,907,493(8.1)
27,330(5.4)
Note: Comprehensive income
For the Fiscal Year ended March 31, 2021
For the Fiscal Year ended March 31, 2020
Net income
per share

Fiscal Year
ended March 31, 2021
ended March 31, 2020

Profit attributable toowners of the Company

Ordinary income(％)(Millions of yen)(％)

28,821－
19,617(12,598)－(13,674)
27,311 million yen－%(29,972) million yen－%－－

Net income
Ratio of net income to
Ratio of ordinary
Ratio of operating
per share(diluted) shareholders' equity income to total assets income to net sales

(yen)

(yen)

482.74(336.51)

(％)

－
－

(％)

11.1
(7.8)

(％)

3.6
(1.5)

1.7
1.4

(2) Consolidated financial position
Total assets(Millions of yen)
As of March 31, 2021
As of March 31, 2020

Note: Shareholders' equity

Shareholders'equity ratio

Net assets(Millions of yen)

824,590
798,442
As of March 31, 2021
As of March 31, 2020

Net assets
per share(％)

191,857
166,097
189,214 million yen
163,648 million yen

(yen)

22.9
20.5

4,656.17
4,027.01(3) Consolidated cash flows situation
Cash flows fromOperating activities
Fiscal Year
ended March 31, 2021
ended March 31, 2020

Cash flows from
Investing activities(Millions of yen)

(Millions of yen)

19,00474,261(4,190)(24,159)

Cash flows from
Financing activities

Cash and cash
equivalents at end of year
(Millions of yen)
(Millions of yen)

(34,223)(42,314)50,892
67,243

２．Cash dividends
Total
amount ofdividend(Annual)Cash dividends per share
1st Quarter 2nd Quarter 3rd Quarter
Year ended March 31, 2020
Year ended March 31, 2021
Year ending March 31, 2022
（estimated）

Year-end

Annual

(yen)

(yen)

(yen)

(yen)

－
－

75.00
30.00

－
－

25.00
30.00

100.00
60.00

－

30.00

－

30.00

60.00

Dividend on
Dividend
shareholders'payout ratio
equity(Consolidated) (Consolidated)(yen) (Millions of yen)

4,063
2,438

(％)

(％)

－
12.4

2.3
1.4

10.8

３．Forecast of consolidated financial results for fiscal year ending March 31, 2022 (April 1, 2021 to March 31, 2022)（Percentage indicate a change from the previous year）

Net sales(Millions of yen) (％)

Annual

1,930,000－

Operating income

Ordinary income(Millions of yen) (％)(Millions of yen) (％)

36,00023.2

32,500

12.8

Profit attributable toowners of the Company(Millions of yen) (％)

22,60015.2

Net income
per share(yen)

556.14

From the beginning of the fiscal year ending March 31, 2022, the Company applies the Accounting Standard for Revenue Recognition (AccountingStandards Board of Japan Statement No. 29). As a result, the figures in the above forecast of consolidated business results constitute the figures
after application of said accounting standard. For this reason, rates of increase/decrease YoY are not shown for net sales.

－1－

HANWA Co., Ltd.

Financial Results for the Fiscal Year ended March 31, 2021

《Consolidated Balance Sheets》(Amounts less than one million yen are rounded down)

Millions of yen
March 31, 2020

March 31, 2021

AssetsCurrent assets;
Cash and deposits
Trade notes and accounts receivable
Electronically recorded monetary claims
Securities
Inventories
OthersAllowance for doubtful receivables
Total current assets

67,256
341,559
21,281
1,167
127,460
69,949(1,046)627,62950,907356,059
27,895―
127,378
69,532(1,679)630,093

26,252
34,1658,624
6,119
75,162
6,331

24,81834,4578,389
6,141
73,806
7,893

56,892
19,141600
13,754(1,070)89,318170,812
798,442

72,472
17,929805
22,044(454)
112,796
194,497824,590

Current liabilities;
Trade notes and accounts payable
Electronically record obligations
Short-term loans payable
Current portion of bonds payable
Income taxes payable
Accrued bonuses
Provision for product warranties
OthersTotal current liabilities

202,671
19,146
67,177
10,021
2,466
2,774
481
59,913364,653

213,436
21,77265,85910,013
6,985
3,281
324
67,549389,222Long-term liabilities;
Bonds payable
Long-term loans payable
Deferred tax liabilities
Deferred tax liabilities by land revaluation
Retirement benefits liabilities
OthersTotal long-term liabilities
Total liabilities

40,013
212,372
1,308
1,562
6,162
6,271
267,691
632,344

30,000193,999
5,611
1,524
5,326
7,048
243,510
632,733

45,651
119,475(3,728)161,398

45,651
137,825(3,729)179,747

6,042
745
3,277
(2,434)(5,380)2,250
2,448
166,097
798,442

15,193372
3,191(4,906)(4,384)
9,467
2,642
191,857
824,590

Fixed assets;
Property and equipment;
Buildings and structures
Land
Machinery, equipment and vehicles
OthersTotal property and equipment
Intangible assets
Investments and other assets;
Investment securities
Long-term loans receivable
Deferred tax asset
OthersAllowance for doubtful receivables
Total investments and other assets
Total fixed assets
Total assets

Liabilities;

Net assets;
Shareholders' equity;
Common stock
Retained earnings
Treasury stock
Total shareholders' equity
Accumulated other comprehensive income
Net unrealized holding gains on securities
Deferred hedge profit and loss
Land revaluation difference
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Minority interests
Total net assets
Total liabilities and net assets－2－

HANWA Co., Ltd.

Financial Results for the Fiscal Year ended March 31, 2021

《Consolidated Statements of Income and Comprehensive Income》(Amounts less than one million yen are rounded down)

Millions of yen
Year ended
March 31, 2020
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Other income;Interest income
Dividend income
Equity in earnings of affiliates
OthersTotal other income
Other expenses;
Interest expenses
Equity in losses of affiliates
Foreign exchange loss
OthersTotal other expenses
Ordinary income

Year ended
March 31, 2021

1,907,493
1,827,666
79,826

1,745,501
1,665,576
79,92552,49627,33050,692
29,232

2,142
1,868
―
1,316
5,327

1,850
1,644
858
1,501
5,855

5,494
35,4392,515
1,805
45,255(12,598)

3,764
―
1,053
1,449
6,267
28,821

Extraordinary income
Gain on sale of property and equipment
Gain on sale of investment securities
Total extraordinary income
Extraordinary loss;
Loss on retirement of property and equipment
Loss on impairment of property and equipment
Loss on devaluation of investments securities
Provision of allowance for doubtful accounts of affiliates
Provision for product warranties
Total extraordinary loss
Income before income taxes and minority interest

229
976
1,206

584
126
711

―
1,003
6,589
615
394
8,603
(19,995)

116
―
387
188
―
692
28,839

Income, inhabitant & business tax - current
Income tax expense-deferred
Total income taxes
Net income

5,962
(406)
5,555
(25,550)

9,012
(33)
8,978
19,860Net income attributable to
Net income attributable to owners of the Company
Net income(loss) attributable to non-controlling interests(13,674)(11,876)

19,617242(4,755)
684
287
92

9,146
(373)
(2,211)
1,011

(730)

(121)

(4,421)(29,972)

7,451
27,311(17,974)

27,188(11,997)

122

Other Comprehensive Income
Net unrealized holding gains on securities
Deferred hedge profit and loss
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Share of other comprehensive income of associates accounted
for using equity method
Total other comprehensive Income
Comprehensive Income
Comprehensive income attributable toComprehensive income attributable to owners of the parent
Comprehensive income(loss) attributable to non-controllinginterests－3－

HANWA co.,ltd.

Financial Results for the Fiscal Year ended March 31, 2021

《Consolidated Statements of Changes in Net Assets》(Amounts less than one million yen are rounded down)

Millions of yen
Shareholders' equity

Accumulated other comprehensive income

Net
Total
Retaineunrealized
Common Capital
Treasury sharehol
holding
d
stock
stock
surplusders'
gains onearnings
equity securities

Balance at March 31, 201945,651(3,737) 180,949(6,095)(6,095)(6,095)

(906)

(906)

(906)

1,141

1,141

1,141

66

66

66

(13,674)(13,674)(13,674)

(0)

(0)

(0)

0

0

0

(91)

(91)

9

9

Total increase (decrease)
Balance at March 31, 2020

(91)
0

－
45,651－ (19,560)－ 119,475

99 (19,551)(3,728) 161,398

61

3,343

(1,435)(5,473)

7,295

Total
net
assets－ 139,036

Increase (decrease) during the term:
Cash dividends paid
Change of scope of consolidated
subsidiaries
Change of scope of equity method
Reversal of land revaluationdifference
Net income attributable toowners of the parent
Purchase of treasury stocks
Capital increase from purchase ofstock of consolidated subsidiaries
Capital increase from sales ofstock of consolidated subsidiaries
Others
Net increase (decrease) during
the term, except for items undershareholders' equity

10,800

Total
DeferredForeign
Remeasure
MinorityLand
valuation
hedge
currency
ments ofandrevaluation translationinterests
definedprofit anddifference adjustments benefit plans translation
loss
adjustments

14,214 202,459(4,758)

684

(66)

(998)

93

(5,045) (11,765) (16,811)(4,758)
6,042

684
745

(66)
3,277

(998)
(2,434)93(5,380)(5,045) (11,765) (36,362)
2,250
2,448 166,097

Millions of yen
Shareholders' equity
Common Capitalstock
surplus
Balance at March 31, 2020

45,651

Increase (decrease) during the term:
Cash dividends paid
Change of scope of consolidated
subsidiaries
Change of scope of equity method
Reversal of land revaluationdifference
Net income attributable toowners of the parent
Purchase of treasury stocks
Deposition of treasury stocks
Capital increase from purchase ofstock of consolidated subsidiaries
Others
Net increase (decrease) during
the term, except for items undershareholders' equity
Total increase (decrease)
Balance at March 31, 2021

Accumulated other comprehensive income

Net
Total
RetaineTreasury sharehol unrealized
holding
d
stock
ders'
gains onearnings
equity securities(3,728) 161,398(2,235)(2,235)(2,235)

88

88

88

911

911

911

85

85

85

19,617

19,617

19,617

(0)
－

(0)
－

(117)

(117)

－

0

(117)
－

－
45,651－ 18,350－ 137,825－(0) 18,349(3,729) 179,747

－4－

745

3,277

(2,434)(5,380)

2,250

Total
net
assets－ 119,475

(0)
－

6,042

Total
DeferredForeign
Remeasure
MinorityLand
valuation
hedge
currency
ments ofandrevaluation translationinterests
definedprofit anddifference adjustments benefit plans translation
loss
adjustments

9,151

(373)

(85)

(2,472)

996

7,216

9,151
15,193

(373)
372

(85)
3,191

(2,472)(4,906)996(4,384)

7,216
9,467

2,448 166,097

193

7,410

193 25,759
2,642 191,857

HANWA co.,ltd.

Financial Results for the Fiscal Year ended March 31, 2021

《Consolidated Statements of Cash Flows》(Amounts less than one million yen are rounded down)

Millions of yen
Year ended
March 31, 2020

Year ended
March 31, 2021

Cash flows from operating activities;
Income before income taxes
Depreciation and amortization
Loss on impairment of property and equipment
Amortization of goodwill
Increase(decrease) in allowance for doubtful receivables
Interest and dividend income
Interest expense
Equity in earnings of affiliated companies (gain)
Gain on sale of property and equipment
Gain on sale of investment securities of unconsolidated subsidiaries
Loss on retirement of property and equipment
Loss on devaluation of investments securities
Provision of allowance for doubtful accounts of affiliates
Provision for product warranties(Increase)decrease in trade receivables(Increase)decrease in inventories
Increase(decrease) in trade notes and accounts payable
Increase(decrease) in retirement benefits
Other, net
Sub totalInterest and dividends received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities(19,995)
5,245
1,003
514
(358)
(4,010)5,494
35,439
(229)
(976)
―
6,589
615
394
95,20921,897(69,814)321
4,630
81,9694,931(5,594)(7,044)74,261

28,839
5,479
―
468
(167)
(3,494)
3,764
(858)
(584)
(126)
116
387
188
―
(21,603)282
13,576583(2,961)
23,8903,567(3,797)(4,656)19,004

Cash flows from investing activities;
Payment for time deposits
Proceeds from refund of time deposits
Payment for purchase of property and equipment
Proceeds from sale of property and equipment
Payment for acquisition of investment securities
Proceeds from sale and redemption of investment securities(Increase)decrease in short - term loans receivable, net
Increase in long - term loans receivableCollection of long-term loans receivable
Other, net
Net cash provided by (used in) investing activities

(679)
1,598
(7,500)575(10,614)
1,546(3,516)(7,091)
5,188(3,665)(24,159)(14)
73(6,332)
1,318(2,788)1,228
1,171(4,701)
7,715(1,860)(4,190)Cash flows from financing activities;
Increase(decrease) in short-term loans, net
Proceeds from long-term debt
Repayments of long-term debt
Payment for redemption of bonds
Payment for cash dividends
Cash dividends paid to minority interest in consolidated subsidiaries
Purchase of investments in subsidiaries resulting in no change in scope of consolidation
Other, net
Net cash provided by (used in) financing activities(23,470)
30,854(32,958)(10,021)(6,092)
(143)
(187)
(295)
(42,314)(10,497)
12,098(22,802)(10,021)(2,242)
(134)
(134)
(490)
(34,223)(1,389)6,398
58,3842,460―
67,243

2,402(17,006)
67,243632
2250,892

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 in cash and cash equivalents from newly consolidated subsidiaries
Increase in cash and cash equivalents resulting from mergers with unconsolidated subsidiaries

Cash and cash equivalents at end of period－5－

HANWA co.,ltd.

Financial Results for the Fiscal Year ended March 31, 2021

《Segment information》
Segment information by business category for the fiscal year 2019 and 2020, is as follows:(Amounts less than one million yen are rounded down)

Fiscal Year ended March 31, 2020

Millions of yen

Reportable segment
Steel
Net sales
Customers
Inter-segment
Total
Segment income(loss)
Segment assets
Other
Depreciation
Depreciation of Goodwill
Interest income
Interest expenses
Equity in earnings (losses) ofaffiliates
Investment in affiliates
Property, plant and equipment
and Intangible assets increase
Fiscal Year ended March 31, 2021

Primary
Metal
Metal Recycling

994,269 255,660
11,134
4,195
1,005,403 259,855
14,628 (30,506)
410,634 171,092
4,074
363
226
2,996

Foods

Energy& Living
Materials

Overseas
sales
subsidiaries

Subtotal

77,609 100,615 201,763 195,325 1,825,244
1,209
1,139
8,693 45,686 72,057
78,818 101,754 210,457 241,011 1,897,301
2,302
(144)
4,177
466
(9,076)22,312 44,840 40,338 62,163 751,381

16
―
1,584
4,231

330
68
3
368

111
―
27
618

168
82
27
257

103
―
246
1,451

(731) (34,913)

31

―

26

5,086

―

157

―

541

1,534

9,037

80

591

137

318

105

Other

Total

Adjustment

82,248 1,907,493― 1,907,493
2,755 74,812 (74,812)―
85,004 1,982,305 (74,812) 1,907,493
1,400(7,676) (4,921) (12,598)
30,254 781,635 16,807 798,442

4,804
514
2,116
9,922

353
―
13
181

5,157
514
2,129
10,10487―
12(4,609)

5,245
514
2,142
5,494

(53) (35,640)

200(35,439)―(35,439)

7,320

1,295

8,616

―

8,616

10,270893

11,164432

11,597

Millions of yen

Reportable segment
Steel
Net sales
Customers
Inter-segment
Total
Segment income(loss)
Segment assets

Consolidated

Primary
Metal
Metal Recycling

901,199 230,880
11,9902,898
913,189 233,778
18,911
3,804
400,623 148,276

Foods

Energy& Living
Materials

Overseas
sales
subsidiaries

Subtotal

77,699 99,697 176,043 175,160 1,660,680
1,874
748
7,002 29,682 54,196
79,573 100,445 183,045 204,843 1,714,876
766
2,141
5,548
1,715 32,887
28,464 41,584 43,034 90,584 752,568

Other

Total

84,821 1,745,501
3,038 57,234
87,860 1,802,736
1,455 34,343
33,187 785,756

Adjustment

Consolidated― 1,745,501(57,234)―(57,234) 1,745,501(5,522) 28,821
38,834 824,590

Other
Depreciation
4,126
15
347
88
205
217
5,001
379
5,380
98
5,479
Depreciation of Goodwill
390
―
22
―
54
―
468
―
468
―
468
Interest income
268
1,001
0
1
24
497
1,795
3
1,798
51
1,850
Interest expenses
2,543
1,607
272
417
195
388
5,424
169
5,593
(1,829)3,764
Equity in earnings (losses) of
547
(32)
25
―
44
63
648
209
858
―
858
affiliates
Investment in affiliates
5,834
―
211
―
585
1,864
8,496
1,505 10,002― 10,002
Property, plant and equipment
6,022
85
249
133
293
167
6,952
638
7,590
192
7,782
and Intangible assets increase
Notes:
1. “Other” comprises businesses that are not included in reportable segments, such as lumber section and machinery section.
2. Adjustments are as follows:(1) Adjustments for segment income include intersegment elimination and Group costs that have not been distributed to reportable segments. These
group costs consist mainly of expenses of administrative departments.

(2) Adjustments for segment assets include Group assets that have not been distributed to reportable segments. These group assets consist mainlyof cash and cash equivalents, investment securities and assets of administrative departments.

(3) Adjustments for depreciation include mainly depreciation and amortization expenses of group assets.
(4) Adjustments for interest income and interest expenses include intersegment elimination, revenue and expense that have not been distributed toreportable segments.

(5) Adjustments for property, plant and equipment and intangible assets increase are increases in Group assets.
3. Segment income or loss is adjusted between ordinary income on the consolidated statements of income and comprehensive income.
4. Since the 1st Quarter of the fiscal year, Company reviewed the name of segment in order to express more appropriately the business, andchanged the reportable segments from "Petroleum & chemicals" to "Energy & Living Materials".
The change was only name change, and segment information had no effect from the change.
Segment information of the previous fiscal year has been recomposed by the new classification method.

－6－

May 12, 2021

Highlights of Consolidated Financial Results for the FY2020(Japan GAAP)HANWA Co., Ltd.

Outline of Financial Results for the FY2020(Unit: billion yen, rounded down to 0.1 billions yen)・During the fiscal year under review, the COVID-19 pandemic impacted the business results of Hanwa Co., Ltd. As measures to restrain the pandemic
suppressed business activity, demand for steel and related products declined. Transaction volume fell as a result, particularly in the first half of the fiscal year.
Prices for petroleum products persisted at a low ebb. As a result, net sales declined 8% from the previous fiscal year (YoY) to 1,745.5 billion yen. In earnings
terms, operating income appreciated 7% YoY to 29.2 billion yen, buoyed by increases in the Steel, Foods and Energy & Living Materials segments. Other
favorable developments included equity in losses of affiliates in the previous fiscal year turned profitable in the period under review and a decrease in interest
expenses, resulting in ordinary income of 28.8 billion yen and net income attributable to owners of parent of 19.6 billion yen.
・The Company distributed an interim dividend of 30 yen per share and expects to distribute a year-end dividend of 30 yen per share.

Operating Results
Net sales
Gross profit
SG&A expenses

FY2019Year-on-year

FY20201,907.4

Change1,745.5(161.9)Main Factors

rate

79.8

79.9

0.0

0%

52.4

50.6

(1.8)

-3%

Demand for steel and related products retreated, with transaction
volume falling particularly in the first half of the fiscal year. Prices
for petroleum products persisted at a low ebb as compared withthe previous fiscal year. Net sales declined 8 % YoY to 1,745.5
billion yen.

Operating income

27.3

29.2

1.9

7%

Non-operating income

5.3

5.8

0.5

10% (SG&A expenses)

Non-operating expenses

45.2

6.2

(38.9)-86%

Ordinary income(12.5)

28.8

41.4

―

Extraordinary gain

1.2

0.7

(0.4)

-41%

Extraordinary loss
Income before income
taxes and others

Net income
Owners of the Company(loss)
Non-controlling interests(loss)

EPS (yen)Comprehensive
incomeSegment
Information

0.6

(7.9)

(19.9)

28.8

48.8

―

5.5

8.9

3.4

62%

(25.5)

19.8

45.4

―

(13.6)(11.8)(336.51)19.6
0.2
482.7433.2
12.1
819.25―――(29.9)

27.3

57.2

―

Net sales
FY2019FY2020Steel

1,005.4

913.1

Primary Metal

259.8

Metal Recycling

78.8

Foods

* Energy&
Living Materials
Overseas sales
subsidiaries
Total for reportablesegments

Other

101.7

Travel expenses and entertaining expenses declined amid thecurtailment of sales activities. SG&A expenses decreased by 1.8
billion yen YoY. However, personnel expenses rose by 1.2 billion
yen YoY (including 0.2 billion yen at newly consolidated
subsidiaries).

Non-operating income grew by 0.5 billion yen YoY while nonoperating expenses dropped by 38.9 billion yen YoY. The main
impacts on ordinary income were as follows.
Interest expenses: decrease of 1.7 billion yen(YoY)
Foreign exchange loss: decrease of 1.4 billion yen(YoY)
Equity in earnings (losses) of affiliates:
losses of 35.4 billion yen in FY2019
earnings of 0.8 billion yen in FY2020

627.6

630.0

2.4

0%

(Fixed assets)

170.8

194.4

23.6

14%

632.3

632.7

0.3

0%

331.1
301.6
263.8
250.7
*
* 133%/105%
161%/127%(29.4)(13.1)
-28pt

-9%
-5%
―

191.8

25.7

16%

161.3
179.7
2.2
9.4
2.4
2.6
4,027.01
4,656.17
163.6
189.2
*
20.5/23.6 % 22.9/26.0*%

18.3
7.2
0.1
629.16
25.5
2.4pt

11%
321%
8%
16%
16%
12%

Total liabilities(Net interest-bearing debt)

Net DER
Total net assets

166.0(Equity capital)(Minority interests)
BPS (yen)
Shareholders' equity
Shareholders' equity ratio

rate

18.9

29%

233.7

-10%

(30.5)

3.8

―

79.5

1%

2.3

0.7

-67%
―

210.4

183.0

-13%

4.1

5.5

33%

241.0

204.8

-15%

0.4

1.7

268%

1,897.3

1,714.8

-10%

(9.0)

32.8

―

85.0

87.8

3%

1.4

1.4

4%

1,982.3

1,802.7

-9%

(7.6)

34.3

―

Adjustment(74.8)(57.2)

-23%

(4.9)

(5.5)

12%

Consolidated

1,907.4

1,745.5-8%(12.5)

28.8―(Total Assets)
Trade receivables and investment securities increased, raising total
assets 3% from the end of the previous fiscal year.
Trade notes and accounts receivables 356 billion yen (4 % fromthe end of the previous period).Investment securities 72.4 billion
yen (27% from the end of the previous period).

(Liabilities)
Factors such as an increase in trade payables contributed to anincrease in total liabilities of 0.1 % from the end of the previous
fiscal year. Interest-bearing debt declined 9 %, while net debtequity ratio was 133% (*105%).

(Net assets)
Total net assets increased 16 % from the end of the previous fiscal
year, as the Company accumulated retained earnings from net
income attributable to owners of parent and valuation difference
on available-for- sale securities rose. Shareholders' equity ratio
was 22.9% (*26.0%), which is 2.4 percentage points higher than at
the end of the previous fiscal year.
*Reflecting equity credit attributes of the subordinated loan

Year-on-year

FY2019FY201874.2

19.0(55.2)-74%(24.1)

(4.1)

19.9

-83%

(42.3)(34.2)

8.0

-19%

67.2

50.8

(16.3)-24%

1st half

2,500

ChangeMain Factors

rate(Operating cash flows)
Due to increase in net sales and trade payables.
(Investment cash flows)
Due to purchase of tangible fixed assets and investment
securities.
(Financial cash flows)
Due to repayment of debt and redemption of corporate
bonds.

Main Factors* Since the 1st Quarter of the fiscal year, Company changed the reportable segments from "Petroleum & chemicals" to "Energy & Living Materials".
・ Apr. Acquire 100% of the shares of TATSUTA CO., LTD. which is a steel material distributor in Osaka.
・ Oct. Acquire 100% of the shares of TEKKEN Industry CO., LTD. which is a steel fabricator in Fukui.
・ Mar. Japanlife Co., Ltd., a consolidated subsidiary of the Company, acquired 100% shares of BiC Co., Ltd..

1,745.5

961.4

1,004.9

836.9

Net sales

Operating income 10.4

6.7

6.9

6.6

477.2

484.2

375.6

425.4

443.9

500.5

FY2019/3Q

4Q

FY2020/1Q

2Q

3Q

4Q

800
600

944.4

946.0

200

801.0

7.6

4.4

400

1,000
500

(Steel business)
Although demand for steel declined, reducing transaction volume, earnings
margins rose as steel prices held to a rising trend. Selling expenses also fell.
These factors pushed segment income upward despite declining net sales.
(Primary metals business)
A decline in activity among steel and non-ferrous-metal manufacturers in the firsthalf of the fiscal year engendered a weakening of transaction volume. At thesame time, a transient loss on Samancor was not realized, resulting in a decline
in interest expenses. Segment income rose despite a fall in net sales.
(Metal recycling business)
Net sales grew amid rising prices for copper and e-scrap. However, theCompany incurred a loss on valuation of derivatives transaction balance, used tohedge price-fluctuation risks in inventories amid rising prices for base metals.
Segment income decreased while net sales grew.
(Foods business)
Although product prices trended at lower levels than in the previous fiscal year,
the profitability of the Company’s US sales subsidiary improved, while thenumber of domestic consolidated subsidiaries increased and valuation losses oninventories declined. Segment income rose despite a fall in net sales.
(Energy & Living Materials business)
Petroleum product prices followed a rising trend, while a widening price spread
between the Japanese and overseas markets secured a solid earnings margin. In
addition, sales of palm kernel shells (PKS) and handling of daily goods
broadened. All of these trends supported an increase in segment income.
(Overseas sales subsidiaries)
With prices for Indonesian steel on a rising trend, earnings margins expanded.
Profitability of transactions in non-ferrous metals in Thailand improved,
contributing to increased segment income.

1,907.4

1,069.6

954.1【Quarterly Operating Results】

2nd half
2,074.6

1,791.1

1,500

14.6

2.1

Cash flows fromoperating activities
Cash flows from investing
activities
Cash flows fromfinancing activities
Cash and cash equivalents
at end of period

2,000

Total

Topics(Current assets)

Main Factors

rate【Changes in Net Sales】

Gain on sales of fixed assets Approx. 0.5 billion yen: Mainly salesof property by consolidated subsidiaries

-9%

(0.1)

3%

(Extraordinary gain/loss)

FY2020-1%

26.1

Cash Flow

FY2019

100.4

824.5

(Valuation & translation
adjustments)

Segment income
rate

798.4

Total assets

Change-92% (Non-operating income/expenses)

8.6

Income taxes

Mar. 2021(Interest-bearing debt)-8% (Net sales)

Comparison with Mar. 2020

Mar. 2020

Financial Position

00

FY2017FY2018FY2019FY2020【Changes in Net Income】
1st half

30.0
25.0
20.0
15.0
10.0
5.0
0.0
-5.0
-10.0
-15.0
-20.0

17.3
8.8
8.5

【Changes in Interest-bearing Debt】
Interest-bearing debt

2nd half
19.6
13.9
7.3
6.5

500
400
300
200
100
0

12.8
6.8

5.1
(18.8)FY2017(13.6)FY2019FY2018FY2020change1,745.5

1,930.0―

Operating income

29.2

36.0

Ordinary income

28.8

Net income attributableto owners of parent

19.6

Net sales

FY2020Net DER

Reflecting subordinated loan
363.2
331.1
325.5
1.6
1.6
1.5

1.3

3
301.6
1.3

1.3

1.1

2
1
0

FY2017

FY2021(estimated)

Forecast(Annual)

10
8
6
4
2
0

FY2018FY2019FY2020

FY2021FY2019FY2020Interim (yen)

75.00

30.00

30.00

23%

Year-end (yen)

25.00

30.00

30.00

32.5

13%

Annual (yen)100.00

60.00

60.00

22.6

15%

Dividend payout ratio

―

12%

11%

Cash Dividends(estimated)* From the beginning of the fiscal year ending March 31, 2022, the Company applies the Accounting Standard for Revenue Recognition(Accounting Standards Board of Japan Statement No. 29). As a result, the figures in the above forecast of consolidated businessresults constitute the figures after application of said accounting standard. For this reason, rates of increase/decrease YoY are not shown for net sales.