JSP Annual Review

2019Year ended March 31, 2019

Contents
Corporate Philosophy / Management Philosophy

2

About JSP

3

Financial Highlights

4Interview with the President

5

Review by Business Segment

9

ESG Information
Environmental and Social Activities in Japan in 201811

Corporate Governance

15

Consolidated Balance Sheets

19

Consolidated Statements of Income

21

Consolidated Statements of Changes in Net Assets

22

Consolidated Statements of Cash Flows23

Stock Information

24

Global Network

25

Corporate Data

26

Corporate Philosophy“Creatively and Actively Contribute to Society”

Editorial policy
This report has been compiled so as to provide our shareholders,investors and other stakeholders with an understanding of theprocess toward achievement of JSP’s medium to long-term vision.
In addition to the financial information detailed in our previous
annual reports, including our business results and management
plans, from this fiscal year we are also publishing non-financial
information, including our medium to long-term business strategy
and ESG (environmental, social and governance) data.

JSP is a market leader in the engineered foamed products industry and has been pioneering foamed products since its founding in 1962. We develop products that take full advantage of the potential of foamed products for virtually every field of industry, where they
contribute to developing industry and enriching people’s lives around the world.
We have cultivated our business activities in line with our deep respect for the natural environment and design each of our products from the earliest R&D stages to have minimal
impact on the environment.
JSP is creating new value for customers worldwide through engineered foamed products
utilizing our leading capabilities developing products that “break the mold” of existing concepts, proposing products and materials that meet current and future market needs, andsupplying customers from a worldwide network of production bases.

Report period
April 1, 2018 – March 31, 2019
(partially includes activities carried out from April 2019)

Management Philosophy

Information disclosure● Inspire customers and consumers
Forward-looking statements —This annual review includes forward-looking statements
related to JSP Corporation’s plans, strategies, and businessresults. These statements represent judgments of JSP basedon information available at the time of writing. As such, thesestatements are subject to risks and uncertainties. Please
understand that actual performance may differ from theseforward-looking statements.

01● Deliver satisfaction to shareholders and the community● Be excited about our work
JSP website

https://www.jsp.com

02FINANCIAL HIGHLIGHTSJSP Corporation and Consolidated Subsidiaries—Year ended March 31, 2019

Thousands of
U.S. dollars1

Millions of yen

2019

2018

2017

2016

2015

2019

¥116,133
5,479
5,835
6,047
4,309

¥114,284
9,105
9,217
9,488
6,853

¥109,048
9,612
10,033
10,013
7,301¥114,904
9,278
9,101
8,752
5,914

¥116,923
5,667
6,044
6,000
4,039

$1,046,337
49,37052,57754,48638,829129,229
84,141
80,239125,728

113,151
76,77872,532

115,136
72,497
67,890116,71770,35265,307

1,164,339
758,099
722,943

For the Year:Net sales
Operating income
Ordinary income
Income before income taxes
Net income attributable to owners of the parent
At Year-End:Total assets
Total net assets
Shareholders’ equity

Our Strength

84,10579,524

U.S. dollars1

Yen

Development
capability

Material
and design
proposal
capability

Supplycapability

Globalnetwork

Environmentally
responsible

Global supplier of foamed products

Per Share Information¥ 144.57
50.00
2,691.76

Net income2
Cash dividends
Total net assets¥ 229.91
50.00
2,667.72¥ 244.94
50.00
2,433.10¥ 198.40
40.00
2,277.32

Notes: 1. U.S. dollar amounts are translated from yen, for convenience only, at the rate of ¥110.99=US$1.
2. Net income per share is computed based on the weighted-average number of shares of common stock outstanding during each year.

9.2 9.6 9.1

116 114 109 114 116

5.9

5.4

5.6

125 129

4.3
2019

2018

2017

2016

Net income

2015

2019

2018

2017

2016

2015

2019

2018

2017

2016

2015

2019

JSP food packaging materials
play an integral role in foodsafety. Our STYRENE PAPER
expanded polystyrene sheet isused as insulation in hot andcold containers to preserve thefreshness of fish, meat, andvegetables during transport.
We are constantly developing
products offering both highperformance and convenience
to meet the evolving lifestyleneeds and food preferences.

2018

Food packaging

JSP develops and provides
packaging solutions for safe
transport of items ranging
from household electronics
to precision equipment andfragile items. Our MIRAMAT
series of low-density expanded polyethylene products
provides exceptional cost andperformance advantages fromits combination of extreme
versatility, high durability, andreusability. These attributes
have made MIRAMAT a leading packaging material in the
distribution field, particularly
for use as long-lasting andreliable cushioning for items
requiring extended shippingand storage periods.

2017

Packaging

JSP products help ensure thesafety of social infrastructure
as key components in road
construction, soft-ground stabilization, landslide prevention,and other civil engineering
applications. Our STYRODIABLOCK products combining
expandable polystyrene andlightweight mortar wall surfacing materials enable fast andeasy wall construction. The
blocks, which are lightweight,
easy to work with, and highly
resistant to corrosion, makethe most of the unique characteristics of foamed materials toprovide new value in the civilengineering field.

2016

Civil engineering

JSP insulation materials
contribute to creating comfortable home living environments
by providing exceptional
insulation performance forheat and cold retention andwater shedding. Our core
expanded polystyrene product
MIRAFOAM is widely used inhomes, apartment and officebuildings, and other large
structures and by commercial
operators with refrigerated
warehouses.

2015

03

Construction

JSP technologies offer a wide
range of performance benefits
to automobile manufacturers,
from enhancing collision safety
performance to reducing
vehicle weight and improving
fuel efficiency. JSP supplies
leading automakers with
automotive components thattake full advantage of theunique capabilities of highperformance foamed products,
highlighted by our revolutionary lightweight and shockabsorbent ARPRO (Expanded
Poly Propylene) material.

116 115 113

7.3 6.8

4.0

Automotive$ 1.30		 0.45
		 24.25¥ 135.50
30.00
2,190.61

Net sales

Operating income

attributable to owners of the parent

Total assets(Billions of yen)(Billions of yen)(Billions of yen)(Billions of yen)

+1.6%

–39.8%–37.1%+3.1%

Net sales in Japan increased year on
year on higher sales of value-added
products and revised product prices.
Global net sales were flat owing todecreased sales in South Korea andthe slower global economic growthin the fourth quarter.

Overall sales increased from the revised product prices and increased
sales of high value-added products. Global operating income fell
sharply due to higher material costs,
intensified competition in Asia, andincreased investment. Domestic operating income declined from slow
implementation of price revisions
following rises in raw materials andshipping costs.

Net income attributable to ownersof the parent declined 37.1% year on
year to ¥4.3 billion. Extraordinary
income primarily comprised the saleof investment securities.

Total assets increased due to therise in fixed assets from our aggressive capital investment.

04

INTERVIEW WITH THE PRESIDENT

Deeper & Higher 2020

INTERVIEW
WITH
THE
PRESIDENT
We aim to continue growing
together with our customers
and all stakeholders as we“Deliver with WOW!”
Yukio Sakai

President,
Representative Director

Progress with the Medium-Term Business Planand outlook for fiscal 2020
March 2019 marked the end of the first year of the Deeper & Higher 2020 plan
to fiscal 2020. Allow me to begin with a brief summary of our overall earnings
performance. Net sales increased 1.6% year on year while operating income
declined 39.8%, as both were below our original forecasts at the start of theyear. The main factors behind the shortfalls were higher raw material and transport costs, along with our inability to revise our product prices in time to mitigate
the impact of the increased costs. After these results, we are redoubling our
product portfolio management, SWOT analysis, and other management measures to ensure we accurately grasp present business conditions and quickly
get back on track to attain the targets in our medium-term plan.
Looking ahead, we expect to raise both sales and profits in the fiscal year
to March 2020 as our revised product prices gradually start bringing in more
revenue while prices of raw materials remain more stable than in the previous
fiscal year. At the same time, we expect costs to continue rising for transportation and in other areas. We anticipate a very challenging business environment
and therefore will intensify the role of management over the whole Group.

05

Medium-Term Vision

Deeper & Higher

Basic Policy

Promote the Differentiation Strategy• Further cultivate existing business and uncover advantages• Pursue true customer needs by being closer to users• Link marketing activities with customer needs

Promote the Growth Strategy• Concentrate management resources into four growth engines• Drive sustainable growth with a fine balance between being aggressive and defensive

Fortify the Management Base

• Foster involvement of all employees through human resource development• Foster a corporate culture based on health and safety and environmental preservation• Strengthen corporate governanceLong-term vision for the Company in 2027
Management is strongly focused on attaining our yearly performance targets
and fulfilling the expectations of our shareholders. As the Company President,
my main objective is to achieve sustained growth over the longer term. To guide
us in that direction, last year we set the long-term Vision 2027 and our guiding
motive to “Deliver with WOW!”We use the word “WOW!” because we aim to supply products and services
that provide solutions meeting our customers’ true underlying needs. In otherwords, we want to provide value that surprises and impresses our customers. In
this way, we will establish JSP as a brand that customers know they can rely on
to provide solutions that put their needs first and foremost.
The value I am talking about here goes beyond providing products that are
innovative or that offer superior performance. It’s value creation in many ways,
including proposing new uses for existing products or supplying processing
services that help customers with their labor saving needs. We will continue tooffer new products and high value-added services as we seek to fulfill our vision
to become a “true global supplier and a company needed by society.”

Building a high-revenue business structure
We are currently advancing a strategy of “Four Growth Engines” to drive us to
our long-term vision. This strategy focuses our investments into the four areasof automotive components, building and home insulation materials, flat panel
display protective materials, and new business domains to create new added
value for our products and expand our market shares in each segment.
In fiscal 2018, we focused marketing activities on our high value-added
MIRAMAT ACE products in the flat panel display protective materials segment
and generated more sales than we had originally projected. Building and homeinsulation materials sales grew from demand for MIRAFOAM and from growing
attention for the capability of our prefab products to improve work efficiency atconstruction sites. We also enhanced sales of our ARPRO high-performancematerials by expanding its use in new automotive parts and widening its appli-

06

INTERVIEW WITH THE PRESIDENT

cations in other areas. In the fourth engine of new business domains, we created a new Business Strategy Office and formulated a management structure tofacilitate alliances overseas and promote business development worldwide. Our
focus now is on developing markets in the Group’s strength areas of foamed
and packing materials.
We will also continue investing to make our strong businesses even stronger and to accelerate new business creation. One such investment in 2018 was
the construction of a new plant at our factory complex in Kansai to increase our
production capacity of MIRAFOAM and pre-cut MIRAFOAM products in anticipation of growing demand for housing and building insulation materials. While it
will take time for these investments to start generating profits, we will continue
to aggressively implement the strategy to formulate a robust portfolio of multiple
high-earnings businesses.

Vision 2027

Our Vision

A global company for global society

Strengthening our human resources for sustained growth
Companies nowadays are often evaluated by the strength of their commitment
to environmental, social and governance (ESG) considerations, such as theUnited Nations’ Sustainable Development Goals. JSP is focusing on supplying
products that contribute to solving social issues, such as materials that reduce
vehicle weights and improve fuel efficiency. Sustainable management, however, must have a solid foundation, which is built by carefully cultivating humanresources, corporate governance, environmental protection, and health andsafety. This is the reason that one of the key strategies in our medium-term plan
is to fortify the management base.
While we try to create “WOW!” for our customers, my main focus is on
cultivating a work force that feels the “WOW!” themselves. I believe that when
we become a company where our employees and everyone around them sharethe same objectives, we will be enthusiastic about developing products and services beneficial to society, engaging in environmental protection activities, andmaking a safe and secure workplace. And that is when we will be a company
truly able to “Deliver with WOW!” to society.
		Corporate scandals in recent years have made the importance ofcorporate governance very clear. I believe that such scandals occur because
companies concentrate too much on the profits their products can make.
In my view, employees that focus on working with customers and stakeholders to create dynamic products to benefit society will be proudof their work and therefore be more resistant to making improperchoices.
That’s the message I communicated to employees when
we discussed the meaning of “WOW!” during my visits with
JSP employees around the world last year. Realistically, I
can’t expect everyone to fully comprehend from just one
meeting with the company president how this approach affects everything we do for the better. So, I intend to continue repeating the message until it resonates throughout theGroup. Right now, this is an ongoing project, but I believe
we are cultivating invaluable human resources for the longterm that will enable us to realize ongoing growth far into
the future.

07

Clientsandbusiness
partners
Employees

End users

Management Policy

Shareholders
andinvestors

Localcommunities

Key Elements
Fortify and expand
existing businesses

Expand thebusiness domain

Fortify the
management base

Corporate Philosophy
Creatively and actively
contribute to soceity

08

REVIEW BY BUSINESS SEGMENT

58.9 %
Percentage of
total sales

Bead Business

Extrusion Business

Sales rose only slightly as lower sales in South Korea offset higher
sales in North American and China. Earnings declined due to slow
pricing revisions in reaction to higher raw material costs.

Segment sales increased supported by increased value-added
product sales and product price revisions. Earnings decreased
due to slow adoption of price revisions to reflect higher costs
for raw materials and cargo transport along with lower sales ofmaterials used in household materials.

Amounts in millions of yen

Net sales
Operating income

ARPRO

STYRODIA

09

2019

2018

YoY

Amounts in millions of yen¥68,449¥68,261+0.3%

Net sales

3,782

7,154

-47.1%

Operating income

Expanded polypropylene
Market conditions for the expanded polypropylene material ARPRO
continued to include high raw material prices in North America. Sales werestrong in South America supported by recovery in the automobile sales in
Brazil. Sales in Europe were flat year on year owing to slower economic
growth in the fourth quarter. In Asia, sales were strong in Japan on increased
sales of the new rear seat core materials. Sales in China were even with theprevious year, supported by strong first half sales. Sales fell sharply in South
Korea and were impacted in other regions in the fourth quarter by the slower
economic growth.
Expandable polystyrene
Sales increased for expandable polystyrene bead products, chiefly
STYRODIA, despite weaker demand from some sectors. Sales were strong
to the home appliance sector and for functional bead products, while productprice revisions to reflect higher raw materials cost also helped.

2019

2018

YoY

¥41,388¥40,245

+2.8%

2,468

2,692

-8.3%

Food packaging/containers
The sales volume declined for STYRENE PAPER (expanded polystyrene sheet used in food packaging) and other materials used in generalproducts declined in the food tray segment and for MIRABOARD used
for advertising displays. However, product price revisions helped produce
a rise in sales revenue.
Industrial packaging materials
Sales of MIRAMAT expanded polyethylene sheet used for flat panel display substrates and home appliance industrial packaging led the growthin sales for industrial packaging materials amid increased demand forvalue-added products.
Home and building insulation materials andcivil engineering materials
Sales increased on strong demand for the expanded polystyrene extruded
board MIRAFOAM and other construction and civil engineering materials
supported by solid construction industry demand for high-performance
thermal insulation and pre-cut products.

35.6 %
Percentage of
total sales

STYRENE PAPER

MIRAMATMIRAFOAM

10ESG INFORMATIONENVIRONMENTAL

Environmental and Social Activities in Japan in 2018

The JSP Group carries out various activities, centered on responsible care initiatives, for the benefitof the global environment and society in line with its Corporate Philosophy and as part of its efforts tomaintain sustained growth.

Responsible Care Management

Responsible Care is the chemical manufacturing industry’s environmental, health, safety andsecurity performance initiative. JSP is engaged in RC activities from six sides.
Responsible Care Policy
Community
dialogue

Logistics
safetyEnvironmental protection

Safety anddisaster
preparation

Corporate philosophy

Occupational
health and safety

Chemical andproduct safety

JSP, as an internationally competitive firm dedicated to safety andprotecting the environment, conducts business activities to fulfill the
expectations and earn the trust of all shareholders.

Safety Policy
Bearing in mind that safe and stable operations are the foundationof business activities, JSP constantly seek to prevent accidents anddisasters. We comply with laws, regulations, and standards related
to employee health and safety, accident prevention, and productsafety. We continuously improve our health and safety management
and accident prevention system, and conduct companywide activities for health and safety and accident prevention.

Environmental Policy
JSP conducts business activities that protect the environment andmanufactures products that are environmentally friendly. We comply with laws, regulations, and standards related to environmental
protection. We continually improve our environmental management
systems and seek to improve its environmental performance.
President

Environmental Safety Council
Responsible Care Audit
Environmental Safety
Field Survey

General Technology Division(Responsible Care Promotion Office)Hokkaido Plant
Kanuma Office
Kanuma Research Center

Environmental Safety Group
Leader Meeting

Kashima Plant

JSP Group Environmental Safety
Promotion Committee

Yokkaichi No. 1 Plant
Yokkaichi Research Center
Yokkaichi No. 2 Plant
Kansai Plant
Kitakyushu Plant
Kyushu Plant

11

Structure for Responsible Care
JSP Corporation’s structure for responsible care is organized with
the Environmental Safety Council as the highest decision-making
body for quality assurance issues. Chaired by the president, thecommittee deliberates and decides corporate policies related to RC
activities, conducts responsible care audits which it uses to update
internal regulations and set targets for internal initiatives and thecompany’s medium and long-term plans.
The Company seeks to effectively execute responsible care
activities by holding an Environmental Safety Group Leader Meetingat all JSP business sites and by sharing information throughout theGroup through the Environmental Safety Promotion Committee andEnvironmental Safety Field Surveys at all JSP Group firms.

Supporting Our Earth’s Environment

We are systematically advancing initiatives to reduce
our environmental footprint.
Reducing Energy Consumption
In fiscal year 2018, efforts including introducing energy efficient equipment, installing LED lighting, and improving production efficiency
lowered our energy consumption per production unit to 99.1% fromthe previous fiscal year, figures based on the energy use consumption
rate*. This put our average improvement rate for five years to 99.3%,
short of our target to improve the annual average by 1% or more.
We will continue to hold our regular Energy Conservation
Promotion Manager Meetings, horizontally implement energy-saving
initiatives, and share information about highly energy-efficient equipment to meet our goals for energy efficiency.

ESG INFORMATION

Oil-equivalent energy consumption volume
Oil-equivalent energy consumption volume (kl)Production volume (t)(kl)
40,00037,34035,00035,97537,674(t)
200,000

36,82536,690164,773

161,407

162,709

159,534

30,000163,007

25,000175,000
150,000
125,000

20,000

FY

2014

2015

2016

2017

2018

100,000* Energy use consumption rate method: The energy consumption rate is calculated foreach product line, and a year-on-year comparison of the energy consumption rate of
the overall business is then made based on each product line’s share of energy usage.

Reducing Water Consumption
The Company cut water usage at the Kitakyushu Plant by 44% andwater drainage volume by 50% in fiscal year 2018 by installing boiler
condensation inhibitors and increasing its water recycling rate. The
Company is currently implementing the same procedures at the
Kanuma No. 2 Plant and Yokkaichi No. 2 Plant.
The Company’s 11 business sites and two research centers,
depending on their locations, generally use groundwater, industrial
water, or purified water. Installed meters monitor the water usage
volume and action is immediately taken if flow volumes fluctuate
unexpectedly.

Reducing Total Landfill Waste Volume
The Company systematically implemented measures to reduce
waste produced at its business sites to fulfill the fiscal year 2018
target of the medium-term plan for responsible care to reduce wastedelivered to final landfill sites by over 80% from fiscal year 2014.
Proactive recycling efforts along with careful selection of waste
processing contractors and attentive separation of waste materials
enabled us to further reduce waste delivered to landfills from fiscal
year 2017 to 13 tons in fiscal year 2018, a reduction of 88% from fiscal year 2014, as we again achieved our target.

Volume of company waste delivered to landfills
(t)

500

440

400

326

300

235

200
100
0

FY 2012JSP joins the Ministry of the Environment’s
Plastics Smart campaign
The JSP Group’s research and development activities seek toquickly identify social and market needs and offer products that earncustomer trust, and in its processes it follows a fundamental tenet ofdeveloping products that utilize minimal energy and resources.
JSP is actively participating in the Plastics Smart Campaign of
the Ministry of the Environment and engaged in the following plastic
recycling activities.

196

2013

2014

Recycling plastic
waste materials

2015

41

17

13

2016

2017

2018

Thermal recyclingof plastic waste

Using recycledmaterials

JSP Activities
Preventing
plastic beadloss

Using precut
insulation materials to
reduce waste plastic

12

SOCIAL

ESG INFORMATION

JSP and Society

Addressing risks to society and establishing safety
Chemical and Product Safety

Safe Management of Chemical Substances
At the initial stage of designing a new product, JSP rigorously
inspects all legal requirements related to the product and examines
all new materials supplied to us to ensure our products contain noprohibited or restricted substances. We also stay up to date on laws,
regulations, and other requirements related to materials used in our
existing products.
We promptly answer customer requests for quality certificationand information about chemical substance content. We are also preparing to comply with stricter regulations about information access,including annotations covering new chemical contents of products,
and have completed the shift to the chemSHERPA chemical data
sharing platform for managing chemical substances in products andaccess to chemical content data across the full product supply chain.

Products Safety Management
RoHS compliance

JSP complies with the European Union’s Directive on the Restrictionof Hazardous Substances (RoHS) by regularly performing testing at
JIS Q 17025-certified* inspection laboratories for our products anddiscloses the results upon customer’s request. Certain products arealso being analyzed for compliance with the “RoHS 2” Directive.

JSP implements measures aimed at achieving zero worker time lost
due to injuries. In fiscal year 2018, rather than examining more ways
to deal with disasters after they occur, the Company took steps toreduce risk by methodically conducting risk assessments and willcontinue to implement preventive measures to ensure worker safety
at its plants and research sites.

Community Dialogue

Together with our Customers
We encourage customer feedback and actively work to increasecustomer satisfaction. The Company has a clear Quality Policy witha strict definition of quality and designates responsibility and authorization to specific individuals to facilitate quality monitoring and correction. The quality management system at each worksite is basedon international standards and are ISO 9001 certified.

Together with Shareholders and Investors
The JSP Group discloses financial information via quarterly reports,
securities reports, shareholder communications, annual reviews,
and through its website to ensure stakeholders have a clear understanding of the JSP Group’s corporate financial status.

Together with Employees* JIS Q 17025 certification is general requirements for the competence of testing andcalibration laboratories.

Safety data sheets based on GHS

Together with Suppliers

As required by law, we provide safety information for applicableproducts through safety data sheets (SDS’s). In addition, we provide
SDS for our other products not required by laws, but, based on theinternational rules of the Globally Harmonized System of Classification and Labeling of Chemicals (GHS).

Procurement of our products is transparent and fair and available
to all suppliers of any nationality, company size, or business experience. We also seek to provide “optimal procurement” by being prepared to acquire alternative materials and ensuring a stable supply
while also endeavoring to always offer fair prices based on current
market prices and trends in prices of related materials.

Safety and Disaster Preparation

Together with Communities

All worksites seek to raise awareness about earthquake preparedness and conduct periodic training in the use of safety confirmation
systems. The Company also maintains equipment to ensure emergency communications in the event of a disaster, including industrial
portable wireless communications units, satellite-based mobile
phones, and emergency power supplies.

Logistics Safety

Supporting Safety Training at Our Transport Companies
JSP employees research conditions at our transport companies andparticipate as observers in their safety training sessions to understand the status, issues, and improvement strategies for driver training. JSP recognizes transport companies with commendations forexcellence in safety education and transport quality and cooperates
with safety measures for cargo handling operations.

13

Measures for Zero Lost-Time Injuries

The Company has a carefully planned system of training sessions
geared to younger, mid-career, and management-level employees tocultivate future business leaders.

Earthquake Preparedness

Emergency storage battery

Occupational Health and Safety

JSP Group companies conduct activities at each of their businesssites to contribute to their local communities. The Kanuma Officein Tochigi Prefecture annually conducts cleanup campaigns in theneighborhood around its plant site and employees are encouraged
to participate in local blood drives. Subsidiary JSP Molding participates in the Aluminum Recycling Campaign by actively collecting
pull tabs from aluminum cans. Proceeds from selling the tabs torecycling centers are used to purchase wheelchairs for local welfare
institutions and individuals. The company collected 25 kilograms oftabs in fiscal year 2018 on its way to collecting the 800 kilograms
needed to completely fund the purchase of one wheelchair. The
Yokkaichi No. 1 Plant in Mie Prefecture provided public information
sessions about making plant operations resilient to disasters, andannounced the results of its responsible care activities carried out infiscal year 2018, which included emergency response training fromlocal fire departments and advice from disaster-response experts.

Number of work stoppages
15

JSP Corporation
JSP Group (consolidated)
JSP Group (non-consolidated)

10

5

0

FY

2014

2015

2016

2017

2018

Work stoppage frequency(%)

4

JSP Group(non-consolidated)

3
2
1
0

JSP Corporation
JSP Group (consolidated)

FY

2017

2018

JSP Employee Training Courses
Participants

Course title

New employee training
Younger andmid-careers

New employee follow-up training (after 6 months)
Mid-career employee training (fourth year)
Leader training
Level-6 training (for assistant managers)

Evaluators

Evaluator training

Managers

Level-8 training (management candidates)

Directors

Executive directors, external seminars

BeforeAfter

Top: Cleaning up the neighborhood of the Kanuma Plant
Bottom left: Collecting pull tabs from aluminum cans
Bottom right: A community dialogue

14

GOVERNANCE

ESG INFORMATION

Corporate Governance

As of July 8, 2019

Basic Policy on Corporate Governance
JSP places top priority on realizing sustained business growthand enhancing corporate value following our corporate philosophy to “creatively and actively contribute to society” and withthe objective of fulfilling our promise to be an internationallycompetitive company that emphasizes safety and environmental awareness. We aim for the management of our Company toearn the trust of and fulfill the expectations of all stakeholders.
We believe that effectively functioning corporate governanceand constant effort to maintain and improve management efficiency, transparency, and soundness are essential to fulfilling
this objective.

Basic Policy
1. The Company has adopted the Company with a Board ofCompany Auditors framework in which the Board of Directors
makes decisions on important issues for the Company andseeks to provide an environment enabling management tomake sound decisions to carry out the decisions of the Boardof Directors.

Corporate Governance Structure Diagram

2. The Company respects the rights and viewpoints of all stakeholders and seeks to maintain appropriate and cooperative
relations.
3. The Company provides appropriate information disclosureand seeks to ensure transparency for all stakeholders.
4. As a Company with a Board of Company Auditors, the Company appoints independent outside directors and auditors tomonitor the Company’s management activities and ensure
sound management practices.
5. The Company engages in constructive dialogue with shareholders.

Corporate Governance Structure
1. Status of Business Execution
As stipulated in the Articles of Incorporation, the Company
maintains a Board of Directors and Board of Auditors comprising up to 16 directors. The Company maintains a structure of 10
directors, including two outside directors. The Board of Directors meets, in principle, on a monthly basis to deliberate andOutline of the Corporate Governance Structure

General Meeting of Shareholders
Appointment/Dismissal

Appointment/Dismissal

ReportBoard of Directors
10 Directors(2 Outside Directors)

Selection andRemovalSupervision

Consult

Appointment/Dismissal

Audit

ReportBoard of Auditors
4 Auditors(2 Outside Auditors)

Cooperation

Accounting
Auditor
Audit

Nomination Advisory Board
Remuneration Advisory Board
Consult

ReportManagement
Committee

Business
Divisions

ReportInternal Audit Dept.
Internal Audit
Group
Audit

• Number of Outside Directors: 2
ReportRisk
Compliance
Committee

Guidance andSupervision

Administrative
Divisions

ReportCooperation

Group Companies

15• Number of Directors stipulated in the Articles of Incorporation: 16• Number of Directors: 10
Cooperation

Directors Meeting

Directors• Chair of the Board of Directors: President

Representative Director
ReportCompany with auditors• Term of office stipulated in the Articles of Incorporation: 1 year

Audit

Directives andSupervision

Organizational structure* We have set up an external reporting desk fordomestic group companies.

Auditors• Number of Auditors stipulated in the Articles of Incorporation: 4• Number of Auditors: 4• Number of Outside Auditors: 2

Number of Independent Executive Officers: 4• Outside Directors: 2• Outside Auditors: 2

make decisions on items as stipulated by law and internal company regulations and on items important to the managementof the Company and to supervise the execution of businessactivities. The Management Meetings serve as a supplementaryfunction to the Board of Directors. The meetings, attended by
the representative director, managing executives, and personnel in higher positions, are held, in principle, on a monthly basis
to conduct preliminary discussions on important management
issues. The Company additionally uses an executive director
structure as a system for executing business operations. The
Directors Meeting maintains a structure of 19 directors, comprising directors and executive officers. It meets, in principle, twicea month to deliberate on items important to the management of
the Company and to achieve efficient execution of business.
Regarding the compliance structure, the Risk Compliance Committee, chaired by the Director, Executive Officer, andGeneral Manager of the General & Personnel Affairs Division,
meets, in principle, on a monthly basis. The Committee manages compliance and risk across the JSP Group and provides
support for management decisions to ensure that the Board of
Directors assumes appropriate levels of risk.
Evaluation of the Effectiveness of the Board of Directors
The Company issues questionnaires to directors on an annual
basis and uses the questionnaires as a basis for assessing theeffectiveness of the Board of Directors. The Board of Directors
analyzes and evaluates the results of the questionnaires andincorporates the views of the independent outside directors andoutside auditors.
To evaluate the Board of Directors’ effectiveness in fiscal
2018, questionnaires were distributed to all of the directors andauditors covering the following items, and the results were discussed at a Board of Directors meeting.
1. Matters concerning the effectiveness of the Board of Directors overall
2. Matters concerning the composition of the Board of Directors
3. Matters concerning the administrative performance of theBoard of Directors
4. Matters concerning deliberations by the Board of Directors
5. Matters concerning support for directors and auditors
6. Risk management
7. Performance monitoring
8. Evaluations and compensation for management
9. Dialogues with shareholders and others
For this evaluation of the effectiveness of the Board of
Directors, we again requested an external organization to collect,compile, and analyze the questionnaires in order to obtain unrestrained opinions and to ensure objective analysis.
Based on the results of the questionnaire and discussion at the Board of Directors meeting, the Board was deemedlargely effective. Concerning the need for further improvement
in matters concerning the effectiveness of the Board of Directors
overall, which was identified in fiscal 2017, it was confirmed that
this should continue to be tackled. In fiscal 2018, issues wereidentified including the need for non-financial information usedin the monitoring of business results, and constructive dialogue
with shareholders.
We will continue to improve the effectiveness of theBoard of Directors through continuous efforts on the issues thatemerged.

2. Status of Audits(1) Audits by auditors

The Board of Auditors comprises four auditors, including two
outside auditors. The four auditors carry out audits of the Company’s business operations informed by the input from the highly independent outside auditors. All of the auditors are highly
knowledgeable about financial and accounting operations andhave abundant experience in various aspects of the accounting
process, including as auditors in the chemicals industry.
The auditors and outside auditors attend meetings of theBoard of Directors and important company meetings and holdmonthly auditor meetings in which they conduct discussions
with managers in charge of specific operations to supplement
and guide their detailed audits of the legality and appropriateness of the business operations and the financial standing of
the companies in the JSP Group. The auditors also regularly
and when deemed necessary solicit the advice of accounting
auditors regarding specific accounting issues.
With regard to matters related to internal audits, as described above, reports are received from the Audit Group as
appropriate concerning the results of these audits, and opinions
are exchanged in order to strengthen mutual cooperation.

(2) Internal audits

The Internal Audit Group of the Internal Audit Dept. comprises
three auditors conducting regular audits of the Company andgroup companies and seeks to enhance the effectiveness ofinternal controls. In addition to the functions of the Internal
Audit Group, the company assigns a Process Owner to eachbusiness division to strengthen the monitoring of each businessprocess.
The Internal Audit Group also conducts internal audits inline with the internal audit plan for each year and reports theresults to each auditor with the aim of facilitating dialogue andfurther strengthening mutual collaboration.

(3) Auditing of accounts

In accordance with the Financial Instruments and Exchange
Act and the Companies Act, the Company has contracted with
Deloitte Touche Tohmatsu LLC to perform accounting audits.

16

GOVERNANCE

ESG INFORMATIONThe Company does not have an interest in the auditing corporation or the executive members of the auditing organization.

Director and Auditor Remuneration
Remuneration for Directors (excluding non-executive directors)
is configured as base compensation and reserve-type remuneration to be paid upon retirement.
Base compensation comprises fixed compensation, shortterm performance-linked compensation, and executive shareholder association-contributed compensation. With regard to
fixed compensation and executive shareholder associationcontributed compensation, which forms part of base compensation, this is defined according to job position and responsibility.
Compensation for non-executive directors and auditors
comprises base compensation in the form of fixed compensation. With regard to short-term performance-linked compensation, which forms part of base compensation, a performance
ratio is calculated for the applicable period in relation to the reference values of the target indicators specified by the Board of
Directors (consolidated sales, consolidated operating income,consolidated operating margin, consolidated net income attributable to owners of parent). A coefficient defined in accordancewith the performance ratio is reduced by 1, corresponding to
fixed compensation, and this is applied to fixed compensation.
The resulting amount is reduced by the amount of shareholder
association-contributed compensation for each job position todetermine the amount of short-term performance-linked compensation.
Reserve-type remuneration to be paid upon retirement isprovided as medium-term performance-linked compensation.
A performance achievement ratio is calculated in relation to thefiscal year-end cumulative amount of the applicable indicators
during the consolidated medium-term management plan, ver-Director and Auditor Remuneration Totals for Fiscal Year 2018
NumberTotal Remuneration

Director

14313

Of which Outside Director

2

16

Auditor

5

41

Of which Outside Auditor

2

22

Total

19

354

Position(Millions of yen)

Remuneration amounts and other payments to individual executives are omitted
because no individual was paid a total amount exceeding 100 million yen.

17

sus the applicable indicators covering the same period during
the previous consolidated medium-term management plan, anda coefficient determined in accordance with this performanceachievement ratio is applied to the base reserve amount for the
fiscal year to determine the amount of reserve-type remuneration to be paid upon retirement.
With regard to the amount of remuneration for each director, the Company President drafts a remuneration proposal forthe current fiscal year within the limit determined by a resolution
passed at the General Meeting of Shareholders, in accordancewith the Company’s Executive Remuneration Regulations, andin consideration of the business environment, operating conditions, Company earnings, the Company’s financial status,
and the contribution to be provided by each individual. The
remuneration proposal drafted by the President is consideredby the Remuneration Advisory Board, which is made up of therepresentative director and outside directors, and is chairedby a lead outside director. The Remuneration Advisory Board
then reports to the President concerning its deliberations on the
remuneration proposal. The President, on the authorization of
the Board of Directors, determines the remuneration amount foreach director.
Remuneration for auditors is set based on negotiations
and in consideration of the contribution to be provided by eachindividual.

Internal Control
Compliance
The Group has established the JSP Group Guidelines for
Corporate Behavior and JSP Group Code of Conduct to which
the Company and its subsidiaries adhere in compliance withlaws, regulations, and social ethics as a premise for corporate
activities.
Our Risk Compliance Committee oversees complianceacross the JSP Group, and is responsible for matters including
the education and training of executives and employees of the
JSP Group on compliance.
We have also set up a compliance consultation deskso that JSP Group executives and employees can report anyquestionable acts that may not be in compliance with laws andregulations. The Risk Compliance Committee reports to theBoard of Auditors on the details of any reported situation, whichis then investigated. Measures are then taken to prevent a
recurrence. It is prohibited to treat a whistleblower badly due totheir reporting of noncompliance, and executives and employees of the Group are being thoroughly educated to that effect.
Regarding the status of compliance, the auditors of theCompany and the Internal Audit Dept. cooperate to conduct
audits.

Storage and Management of Information Pertaining
to the Execution of Duties by Directors
Based on document management regulations, the Company
records and preserves information on the execution of duties
by directors on documents or electromagnetic media. Directors
and auditors can view these at all times, according to document
management regulations. In addition, matters regarding which
information must be disclosed as stipulated by law or the regulations of stock exchanges, etc., are promptly disclosed basedon our information disclosure regulations.

Risk Management System
The Risk Compliance Committee was established to manage
the risks of the JSP Group across the organization. In addition
to identifying and analyzing risks, the committee has also established rules related to risk management and strengthened therisk management system.
Regarding unforeseen circumstances such as a fire orother calamity, the department in charge of crisis management
is to follow the rules and instructions established for emergency
response.

System for the Execution of Duties by Directors
The Company’s Board of Directors, in principle, holds monthly
meetings and makes decisions on basic management policies,
matters stipulated by law, and other important matters related
to management. The Company also has a Management Committee composed of the representative director and executive
officers that meets to deliberate on important management
matters in advance of Board of Directors meetings. We haveadopted a system of executive officers and separate businessheadquarters, and delegate the authority for execution andresponsibility for performance to improve the efficiency of business execution. Important individual management tasks related
to business execution are, in principle, decided at the Directors
Meeting held twice a month.
The Company formulates management plans on a consolidated basis, carries out group business management, andprovides guidance for group companies to achieve targets.
The group companies are organized under separate businessheadquarters, and are under the direct supervision of the particular business headquarters to which the business execution
belongs.

System to Ensure the Appropriateness of Operationsin the Corporate GroupThe Company requires group companies to get preliminary approval for important management issues or report them to theCompany. Our Internal Audit Dept. regularly conducts businessaudits of Group companies to ensure the appropriateness ofoperations.
In addition, to ensure autonomy in the management of
the Company, we have entered into a basic agreement with ourparent company on capital and business alliances, and transactions with the parent company are conducted with terms andconditions equivalent to those between independent parties. In
such ways we strive to ensure the appropriateness operations.

Systems for Effective Auditing■ System relating to the assistance of auditors

Auditors are allowed to request the allocation of employees toassist them in carrying out audits as necessary. Employees
who receive instructions from an auditor that are necessary forcarrying out an audit shall not take orders from directors or others regarding the instructions. In addition, the Board of Auditors
must be consulted with regard to matters related to the transfer,
evaluation, or disciplining of assisting employees.

■ System for reporting to auditors

Directors and employees shall report to the Board of Auditors
matters that seriously affect the JSP Group, in addition to legal
matters and the implementation status of internal audits within
the JSP Group.
Auditors attend the Board of Directors’ meetings and otherimportant meetings of the Company and group companies andwork to gather information on important matters concerning
management in the Group.

■ Other systems

The Board of Auditors regularly provides private interview
opportunities for business managers and others, and holds
regular meetings with the representative director and auditing
firms to exchange ideas.
A certain budget is allocated every year for expenses arising from the execution of duties by auditors.

Approach and System for Excluding Anti-social
ForcesUnder the JSP Group Code of Conduct, the Company stipulates that the JSP Group will be resolutely committed to having
no association whatsoever with anti-social activities or forces inorder to exclude them from the Company’s activities.
The General Affairs Department works closely with outside expert agencies such as attorneys and police, collects andmanages information, and has developed a system to inform
relevant departments as necessary.

18

CONSOLIDATED BALANCE SHEETSJSP Corporation and Consolidated Subsidiaries—As of March 31

Thousands of
U.S. dollars*Millions of yen

ASSETS

2019

2018

2019

Current assets
Cash and deposits
Notes and accounts receivable–trade
Electronically recorded monetary claims–operating
Short-term investment securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Accounts receivable–other
Other
Allowance for doubtful accounts
			Total current assets¥ 14,842
30,630
4,218
23
7,611
1,198
5,611
587
2,177
(72)
66,830¥ 16,963
30,712
3,776
121
6,906
1,115
5,255
513
1,905
(114)
67,157$ 133,728
275,979
38,007
210
68,581
10,801
50,557
5,297
19,621(656)
602,129

43,159(23,361)(12)
19,78574,297(57,406)(80)
16,81014,639
16
(7)
8
3,720
9,381
(8,062)
1,319
56,284
1,729

39,510(22,687)(14)
16,80872,939(56,398)(94)
16,446
14,557
28
(16)
12
3,307
9,405
(7,912)
1,493
52,625926

388,857(210,482)(108)
178,266
669,403(517,219)(728)
151,456
131,899
144(66)
78
33,52084,530(72,638)
11,891
507,113
15,578

1,431
139
1,174
714
1,330
(404)
4,385
62,399¥129,229

1,680
128
1,221
737
1,202
(410)
4,561
58,113¥125,270

12,898
1,256
10,581
6,437
11,986(3,645)39,516562,209$1,164,339

Noncurrent assets
Property, plant and equipment
Buildings and structures		Accumulated depreciation
		 Accumulated impairment loss
		 Buildings and structures, net
		 Machinery, equipment and vehicles
		Accumulated depreciation
		 Accumulated impairment loss
		 Machinery, equipment and vehicles, net
Land
Lease assets
		Accumulated depreciation
		 Lease assets, net
Construction in progress
Other		Accumulated depreciation
		Other, net
			Total property, plant and equipment
Intangible assets
Investments and other assets
		 Investment securities
		 Long-term loans receivable
Net defined benefit asset
		 Deferred tax assets
		Other
		 Allowance for doubtful accounts
			Total investments and other assets
			 Total noncurrent assets
			Total assets

Thousands of
U.S. dollars*Millions of yen

LIABILITIES AND NET ASSETS

2019

2018

2019

Current liabilities
Notes and accounts payable–trade
Electronically recorded obligations–operating
Short-term loans payable
Current portion of long-term loans payable
Lease obligations
Accounts payable–other
Income taxes payable
Accrued consumption taxes
Provision for bonuses
Provision for business structure improvement
Electronically recorded obligations–facilities
Accounts payable–facilities
Other
			Total current liabilities¥ 11,183
2,202
7,497
3,921
8
2,995
544
99
1,449
19
77
1,862
2,482
34,344¥ 11,483
2,005
6,366
3,945
13
2,978
895
96
1,487
131
1,277
2,463
33,145$ 100,757
19,84567,55535,33474
26,991
4,905
893
13,060173
698
16,781
22,363
309,434

Noncurrent liabilities
Long-term loans payable
Lease obligations
Deferred tax liabilities
Provision for directors’ retirement benefits
Provision for business structure improvement
Net defined benefit liability
Asset retirement obligations
Other
			Total noncurrent liabilities
			Total liabilities

7,969
6
881
13
568
176
1,128
10,74445,088

5,712
16
540
11
20
576
160
980
8,019
41,16471,806
61
7,937
118
5,123
1,592
10,16396,804406,239

10,12813,441
59,370(1,386)81,553

10,12813,40556,551(1,385)78,70091,256
121,104
534,915(12,495)
734,781233(2,505)958(1,313)
3,901
84,141¥129,229

244
(483)
1,062
824
4,581
84,105¥125,270

2,103(22,574)
8,633(11,837)
35,156758,099$1,164,339

Net assets
Shareholders’ equity
		Capital stock		Capital surplus
		Retained earnings
		 Treasury stock			Total shareholders’ equity
Valuation and translation adjustments
		 Valuation difference on available-for-sale securities
		 Foreign currency translation adjustment
		 Remeasurements of defined benefit plans
			Total valuation and translation adjustments
Non-controlling interest
			Total net assets
			Total liabilities and net assets* U.S. dollar amounts are translated from yen, for convenience only, at the rate of ¥110.99=US$1.

19

20

CONSOLIDATED STATEMENTS OF INCOMECONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETSJSP Corporation and Consolidated Subsidiaries—Years ended March 31

JSP Corporation and Consolidated Subsidiaries—Year ended March 31, 2019

Thousands of
U.S. dollars*Millions of yen

2019

2018

2019

Net sales¥116,133¥114,284$1,046,337

Cost of sales

85,28680,657

768,415Gross profit

30,846

33,627

277,922

Selling expenses

8,080

7,779

72,802

General and administrative expenses

17,286

16,741

155,749

Total selling, general and administrative expenses

25,366

24,521

228,551

5,479

9,105

49,370

Selling, general and administrative expenses

		Operating income
Non-operating income
Interest income

209

183

1,883

Dividends income

27

25

248

Rent income

75

74

676

Equity in earnings of affiliates

5

6

45

379

286

3,415

695

577

6,270

Interest expenses

148

119

1,339

Foreign exchange loss

95

200

864

Other

95

146

859

		 Total non-operating expenses

340

466

3,063

Ordinary income

5,835

9,217

52,577

Other
		 Total non-operating income
Non-operating expenses

Extraordinary income
Gain on sales of noncurrent assets

29

403

261

Gain on sales of investment securities

411

-

3,703

440

403

3,964

6

13

58

143

119

1,292

		 Total extraordinary losses

228

132

2,054

		Income before income taxes

6,047

9,488

54,486

Income taxes–current

1,481

2,497

13,345

Income taxes–deferred

391

0

3,525

		 Total income taxes

1,872

2,497

16,870Net income

4,174

6,990

37,615

Net income attributable to non-controlling interests

(134)

136

(1,213)

		 Net income attributable to owners of the parent¥ 4,309¥ 6,853$ 38,829

		 Total extraordinary income
Extraordinary loss
Loss on sales of noncurrent assets
Loss on retirement of noncurrent assets* U.S. dollar amounts are translated from yen, for convenience only, at the rate of ¥110.99=US$1.

21

Balance, beginning of period
Cumulative effects of changes in accounting policies
Restated balance, beginning of period
Changes of items during the period:
Dividends from surplus
Net income attributable to owners of the parent
Purchase of treasury stock
Change of scope of consolidation
Capital increase of consolidated subsidiaries
Net changes of items other than shareholders’ equity
Total changes of items during the period
Balance, end of period

Balance, beginning of period
Cumulative effects of changes in accounting policies
Restated balance, beginning of period
Changes of items during the period:
Dividends from surplus
Net income attributable to owners of the parent
Purchase of treasury stock
Change of scope of consolidation
Capital increase of consolidated subsidiaries
Net changes of items other than shareholders’ equity
Total changes of items during the period
Balance, end of period

Balance, beginning of period
Cumulative effects of changes in accounting policies
Restated balance, beginning of period
Changes of items during the period:
Dividends from surplus
Net income attributable to owners of the parent
Purchase of treasury stock
Change of scope of consolidation
Capital increase of consolidated subsidiaries
Net changes of items other than shareholders’ equity
Total changes of items during the period
Balance, end of period

Capital stock

Capital surplus¥10,128¥13,405¥56,551(¥1,385)

10,12813,40556,551(1,385)

Treasury stock

Total shareholders’ equity¥78,700
78,700(1)(1,490)
4,309
(1)
35

(1)
(¥1,386)

2,853¥81,554(1,490)4,309
35¥10,128
Valuation difference
on available-for-salesecurities

¥244

35
¥13,441

2,819¥59,370

Valuation and translation adjustments
Foreign currency Remeasurementsof defined benefit
translationplans
adjustment

244

(11)
(11)
¥233

(¥483)¥1,062

(483)

1,062

(2,022)(2,022)(¥2,505)

Total valuationand translation
adjustments

Net assets¥824¥4,581

824

4,581¥84,106
84,106(679)(679)¥3,901(1,490)
4,309
(1)
35
(2,817)35¥84,142(2,138)(2,138)(¥1,313)

(104)
(104)
¥958

Minority
interests

Capital stockThousands of U.S. dollars*
Shareholders’ equity
Capital surplus
Retained earnings$91,256$120,781$509,514($12,479)

91,256

120,781509,514(12,479)$709,080
709,080(16)(13,429)
38,830(16)

Treasury stock(13,429)
38,829Total shareholders’ equity

323

323
$91,256
Valuation difference
on available-for-salesecurities

Balance, beginning of period
Cumulative effects of changes in accounting policies
Restated balance, beginning of period
Changes of items during the period:
Dividends from surplus
Net income attributable to owners of the parent
Purchase of treasury stock
Change of scope of consolidation
Capital increase of consolidated subsidiaries
Net changes of items other than shareholders’ equity
Total changes of items during the period
Balance, end of period

Millions of yen
Shareholders’ equity
Retained earnings

323$121,104

25,400$534,915

Valuation and translation adjustments
Foreign currency Remeasurementsof defined benefit
translationplans
adjustment(16)($12,495)

Total valuationand translation
adjustments

Minority
interests

25,707$734,787
Net assets$2,206($4,352)$9,575$7,428$41,274

2,206(4,352)

9,575

7,428

41,274$757,783
757,783(6,118)(6,118)$35,156(13,429)
38,830(16)
323(25,384)322$758,106

(103)
(103)
$2,103(18,221)(18,221)($22,574)

(941)
(941)
$8,633(19,266)(19,266)($11,837)* U.S. dollar amounts are translated from yen, for convenience only, at the rate of ¥110.99=US$1.

22

CONSOLIDATED STATEMENTS OF CASH FLOWSSTOCK INFORMATIONJSP Corporation and Consolidated Subsidiaries—Years ended March 31

As of March 31, 2019
Thousands of
U.S. dollars*Millions of yen

Net cash provided by (used in) operating activities
Income before income taxes
Depreciation and amortization
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in net defined benefit liability
Increase (decrease) in provision for directors’ retirement benefits
Loss (gain) on sales and retirement of noncurrent assets
Loss (gain) on sales of investment securities
Loss (gain) on valuation of investment securities
Interest and dividends income
Interest expenses
Foreign exchange losses (gains)
Equity in (earnings) losses of affiliates
Decrease (increase) in notes and accounts receivable–trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable–trade
Increase (decrease) in accrued consumption taxes
Other, net
		Subtotal
Interest and dividends income received
Interest expenses paid
Business structure improvement expenses paid
Income taxes paid
		 Net cash provided by (used in) operating activities
Net cash provided by (used in) investing activities
Purchase of noncurrent assets
Proceeds from sales of noncurrent assets
Payments for retirement of noncurrent assets
Purchase of investment securities
Proceeds from sales of investment securities
Net decrease (increase) in time deposits
Other, net
		Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities
Net increase (decrease) in short-term loans payable
Proceeds from long-term loans payable
Repayment of long-term loans payable
Purchase of treasury stock
Cash dividends paid
Dividends paid for non-controlling interests
Other, net
		 Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period* U.S. dollar amounts are translated from yen, for convenience only, at the rate of ¥110.99=US$1.

23

2019

2018

2019

¥ 6,047
5,601
(32)
(18)
(105)
1
120
(411)
78
(236)
148
116
(5)
(1,075)(1,438)
330
7
(150)
8,978
237
(150)
(1,673)
7,391¥ 9,488
5,072
(222)
(106)
39
0
(270)
(209)
119
101
(6)
(1,555)(1,681)
2,459
(327)
596
13,498
202
(109)
(127)
(2,613)
10,849$ 54,486
50,468
(297)
(168)
(950)
11
1,089
(3,703)703(2,132)
1,339
1,047
(45)
(9,686)(12,959)
2,973
70(1,355)80,892
2,136(1,353)(15,076)
66,598(10,896)
102
(74)
(11)
571
51
(111)
(10,368)(8,153)
819
(9)
(6)
(200)
(112)
(7,661)(98,176)
927
(675)
(103)
5,144
465
(1,004)(93,421)

1,150
6,500
(4,233)(1)(1,490)
(202)
(14)
1,708
(456)
(1,724)
10,807¥ 9,082354
5,325(4,295)(2)(1,639)
(233)
(16)
(506)
160
2,841
7,965
¥10,807

10,36958,563(38,143)(16)(13,429)(1,821)(127)
15,395(4,112)(15,540)
97,370$81,829

Listing market

First Section of the Tokyo Stock Exchange

Securities code

7942

Share trading unit

100 shares

Total number ofauthorized shares

46,000,000

Fiscal year

April 1 – March 31

Distribution of shares by shareholder type
Financial instruments business
operators, other corporations

12.33%
12.16%
20.70%

Major shareholders

Individuals, other54.81%

Foreign individuals
Financial institutions

Shares held

Voting right ratio

Mitsubishi Gas Chemical Company, Inc.

16,02053.74

Japan Trustee Services Bank, Ltd.

2,569

8.61

J.P. MORGAN BANK LUXEMBOURG S.A. 380578

1,114

3.73

JSP Client Stock Ownership Plan

1,089

3.65

The Master Trust Bank of Japan, Ltd.

587

1.97

JP MORGAN CHASE BANK 385166

439

1.47

JSP Employee Stock Ownership Plan

288

0.96

Nippon Life Insurance Company

242

0.81

Sumitomo Forestry Co., Ltd.

170

0.57

THE BANK OF NEW YORK MELLON 140042

161

0.54

(thousands)(%)

Notes: 1. The above list of major shareholders does not include treasury stock held by the company (1,604,000 shares).
2. The shareholding ratio does not include treasury stock.
3. Among the above shares held, the number of shares pertaining to trust business is as follows: Japan Trustee Services Bank, Ltd.
2,569,000 shares; The Master Trust Bank of Japan, Ltd. 587,000 shares.

Number of shareholders

As of March 31

25,00023,16520,00019,11418,182

18,374

2016

2017

2018

15,00010,00012,906

5,000

0

2015

2019

24

GLOBAL NETWORKCORPORATE DATA

As of March 31, 2019

As of March 31, 2019

Head office
Shin Nisseki Bldg., 4-2, 3-chome Marunouchi,
Chiyoda-ku, Tokyo 100-0005, Japan

Japan

Japan

1

Hokkaido

2

Kanuma3

Kashima

4

Tokyo Head Office

5

Yokkaichi

6

Kansai7

Kitakyushu

8

KyushuPresident, representative director
Yukio Sakai
FoundedJanuary 1962
Paid-in capital¥10,128.610 million
Number of shareholders
23,165
Stock exchange listing
Tokyo (First Section: 7942)

EuropeAsia

North America

FranceJSP International SARL

Korea
KOSPA Corporation

U.S.A.
JSP International Group Ltd

Czech
JSP International s.r.o.

TaiwanTaiwan JSP Chemical Co., Ltd.

MexicoJSP International De Mexico
S.A.de C.V

China
JSP Plastics (Wuxi) Co., Ltd.
JSP Plastics (Dongguan) Co., Ltd.
JSP Plastics (Wuhan) Co., Ltd.

25

Fiscal year-end
March 31
Investor relations contact
Public and Investor Relations Department
Tel: +81-3-6212-6302

6
7
8Singapore
JSP Foam Products PTE. Ltd.
ThailandJSP Foam Products

1

2
3
4
5

Number of employees
3,154
Major affiliates
37 in total

South America
BrazilJSP Brasil Industria De
Plasticos Ltda.

www.jsp.com
26

jsp.com

Printed in Japan