2019

A D E K A C O R P O R AT I O N
Full-year Consolidated Financial Results
July 17, 2020

Briefings on Financial Results
For the fiscal year ending March 31, 2020

【TSE 4401】

Financial Results Overview
FY2019April 1, 2019 – March 31, 2020

President and Chief Executive Officer

Hidetaka Shirozume

2

Contents

1.

Preface2.

FY2019 Consolidated Performance3.

Forecasts for FY2020 and Business Strategy

4.

Progress of mid-term management plan
BEYOND 300

5.

For Your Reference

FY2019 Consolidated Financial Results3１．Preface

4Preface
The members of Adeka Corporation would like to express our deepest
condolences to the families of the victims and offer sympathy to thepatients of the novel coronavirus “COVID-19”.
We would also like to express our sincere appreciation to those who havebeen working to prevent the spread of the disease.

Delay in the announcement of results for the FY2019
Countries such as INDIA, in which our overseas group companies operate,
have issued stay-at-home orders and repeatedly extended city-wide
lockdowns to prevent the spread of COVID-19.
This caused a significant delay in the process of compiling consolidated
financial data.
We apologize for any inconvenience and concern caused to our stakeholders
by this delay.

FY2019 Consolidated Financial Results

5２．FY2019 Consolidated Performance

6

FY2019 Consolidated Performance
Consolidated

Unit: 100 million yen

FY2019FY2018Net sales

Increase/decreaseratio : %Increase/decrease

2,993

3,041

47

1.6

Operating profit

266

225

△ 41

△ 15.5

Ordinary profit

266

219

△ 46

△ 17.4

Profit attributable toowners of parent

170

152

△ 18

△ 10.8Net profit per share- yen/share -

165.8

147.7

△ 18.1

45

48

3

Dividend- yen/share -Note : Figures are expressed in units of 100 million yen and have been rounded off.

FY2019 Consolidated Financial Results

7Analysis of Operating Profit
Unit: 100 million yen

Consolidated

The decrease in operating profit

△ 41

14

300

△ 10

△ 21

200

△9

△7

266

△7

225
100

0
FY2018Net pricing

Sales volume

Fixed costs, etc.

ExchangeNIHON
NOHYAKU

Unification offinancial period

FY2019Note : Figures are expressed in units of 100 million yen and have been rounded off.
FY2019 Consolidated Financial Results

8Impact of COVID-19
Plants and sales offices of groupcompanies in Japan and overseas
mostly maintained normal operation.

The operational setback caused by
infection prevention measures is minimal.

Demand for some products such as
automotive, housing, and cosmetics
decreased.

Demand for products for PCs and data
centers is recovering.

The fiscal year end of the office in CHINA, which was affected themost by COVID-19 in the 4th quarter, is December.

The impact on business activities and results for FY2019 is negligible.
FY2019 Consolidated Financial Results

9Impact of unification of financial period
Fiscal year end of four overseas consolidated subsidiaries was changed
from December 31 to March 31.
Consolidated results for FY2019 include the results of the four
companies for 15 months.
Companies included

Unit: 100 million yen

Influence amount・ADEKA FINE CHEMICAL TAIWANTAIWAN｜Manufacture and sales of chemical products

・ADEKA (ASIA)

Net sales

SINGAPORE｜Sales of chemical products

32

・ADEKA Europe

GERMANY｜Sales of chemical products

・ADEKA (SINGAPORE)

SINGAPORE｜Manufacture and sales of edible processed oils
and fats, frozen pie crusts, and related foods

Operating profit

2

Note : Figures are expressed in units of 100 million yen and have been rounded off.

FY2019 Consolidated Financial Results

10Trends in Consolidated Performance
Consolidated

Net sales

Sales:
100 million yen

Operating profit

2,993

3,000
2,227
2,000
193

2,234
210

2,396

Operating profit:
100 million yen

3,041
300

266
225

213

1,000

0

200

100

FY2015FY2016FY2017FY2018FY20190Note : Figures are expressed in units of 100 million yen and have been rounded off.
FY2019 Consolidated Financial Results

11

The FY2019

Consolidated Performance - By segment Unit: 100 million yen

Consolidated

Sales

Increase/decrease

FY2019FY2018
2,993
1,807

3,041
1,641

Polymer additives

946

821

Electronics and IT materials

301

264

Functional chemicals

559

556

717
344
123

710
604
85

Operating profit

266

225

Chemicals

215

175

Polymer additives

69

66

Electronics and IT materials

8259

Functional chemicals

64

12
33
4

Chemicals

Food productsLife science
Other

Food productsLife science
Other

Increase/decrease ratio : %

47
△ 166
△ 124

1.6
△ 9.2

△ 13.2△ 37△ 12.4

△7
259
△ 38

△ 1.0
75.5
△ 31.1△ 40△ 18.8

△ 22

49

△ 15

△ 27.1

15
26
7

3
△7
3

24.9
△ 21.2
72.4

Note : Figures are expressed in units of 100 million yen and have been rounded off.
FY2019 Consolidated Financial Results

△3

△ 41
△2

△ 0.7

△ 15.5△ 4.2△ 23.912

Segmental Information :Chemicals “Polymer additives”
 Sales

Unit: 100 million yen△ 13.2％

 Additives for polyolefin

946

821

FY2018FY2019FY2019“Accounting”

Main factor（YoY）

weak

 Plasticizers, Stabilizers
Supply-demand balance deteriorated in the US, CHINA, SOUTHEAST ASIA

1Q

2Q

3Q

4Q

193

212

205

209

weak

△ 4.2％

66

FY 2018

FY 2019“Accounting”

・Product for Engineering plastics

Unit: 100 million yen

69

FY2019・Product in general Flame retardants

strong Operating profit

・General-purpose antioxidant

Main factor（YoY）

1Q

2Q

3Q

4Q

16

15

18

16

Unit: 100 million yen

Net pricing

Exchange

Unification offinancial period

3

△3

△2

Note1 : Figures are expressed in units of 100 million yen and have been rounded off.
Note2 : The fiscal periods of three overseas subsidiaries including in FRANCE were made consistent in FY2018,
the FY2018 results include results for 15 months.
FY2019 Consolidated Financial Results

13Segmental Information :Chemicals “Electronics and IT materials”
 Sales

Unit: 100 million yen△ 12.4％301
FY2019“Accounting”

 Information media materials

strong264

FY2018・Photoacid generator

used for semiconductor lithography

 Electronic Materials

FY2019

1Q

2Q

3Q

4Q

68

61

64

70

 Operating profit

Main factor（YoY）

grew

・Etchants used for LCD panel

weak

・High-K materials for DRAM
・Materials for NAND flash

Unit: 100 million yen△ 27.1％Main factor（YoY）

82

59

FY2018FY2019“Accounting”

FY 2019

1Q

2Q

3Q

4Q

16

13

15

13

Unit: 100 million yen

Net pricing

Unification offinancial period

Fixed costs, etc.

△9

△6

△3

Note1 : Figures are expressed in units of 100 million yen and have been rounded off.
Note2 : The fiscal periods of three overseas subsidiaries including in KOREA were made consistent in FY2018,
the FY2018 results include results for 15 months.
FY2019 Consolidated Financial Results

14Segmental Information :Chemicals “Functional chemicals”
 Sales

Unit: 100 million yen△ 0.7％

 Surfactants

559

556

FY2018FY2019FY2019“Accounting”

Main factor（YoY）

strongused for moisturizing and gelling・Reactive type emulsifiers
used for paint and adhesives

 Functional polymers

1Q

2Q

3Q

4Q

133

143

137

142

strong・Epoxy resin related products

used for adhesion of electronic devices

 Industrial agentsweak Operating profit

・Cosmetics ingredients

Unit: 100 million yen

・Peroxygen chemicals

used to bleach paper and pulp

△ 23.9％Main factor（YoY）

64

49

FY2018FY2019FY2019“Accounting”

1Q

2Q

3Q

4Q

14

10

13

11

Unit: 100 million yen

Net pricing

Sales volume

Fixed costs, etc.

13

△ 13

△ 13

Note : Figures are expressed in units of 100 million yen and have been rounded off.

FY2019 Consolidated Financial Results

15

Segmental Information :Food Products
 Sales

Unit: 100 million yen△ 1.0％

 Domestic

717

710

FY2018FY2019FY2019“Accounting”

weak
grew

1Q

2Q

3Q

4Q

174

171

186

177

 Operating profit

Main factor（YoY）

・Margarine, shortening
Reduced food waste and enhanced tastiness・Functional margarine, whipping cream Overseas（China, Southeast Asia）

strong・Margarine, shortening

steady・Flower paste

Unit: 100 million yen

24.9％

15

12
FY2018FY2019“Accounting”

Main factor（YoY）

FY2019

1Q

2Q

3Q

4Q

2

1

5

6

Unit: 100 million yen

Net pricing

Fixed costs, etc.

Sales volume

6

△2

△1

Note : Figures are expressed in units of 100 million yen and have been rounded off.

FY2019 Consolidated Financial Results

16Segmental Information :Life Science Sales

Unit: 100 million yen

75.5％ Agrochemicals

FY2018“Accounting”

steady604

344
FY2019weak

FY2019

1Q

2Q

3Q

4Q

112

148

109

233

 Operating profit

Impact of inventory adjustment

JAPAN, CENTAL and SOUTH AMERICA,
SOUTHEAST ASIA

 Pharmaceuticals, others

weak

Field of Athlete's footTopical antifungal agent Luliconazole

Main factor

33

26

FY2018FY2019“Accounting”

INDIA, EUROPE, NORTH AMERICA

Unit: 100 million yen△ 21.2％FY2019Main factor

Profit decreased due to the inclusion of the period inwhich there was low demand for agrochemicals.

1Q

2Q

3Q

4Q

▲6

0

▲3

36

Note1 : Figures are expressed in units of 100 million yen and have been rounded off.
Note2 : Results for the second half of FY2018 (6 months) are included due to the consolidation of
NIHON NOHYAKU Co., Ltd. at the end of September 2018.
FY2019 Consolidated Financial Results

17

３．Forecasts for FY2020
and Business Strategy

18Forecasts for FY2020 Results and Dividends

ADEKA Group is currently examining the impact of
COVID-19 on our key markets and businesses activities.

Schedule for announcement of forecasts for business results and dividends

August 12, 2020 (scheduled)
The announcement is scheduled to be made in the Summary of consolidated financial results
for the three months ended June 30, 2020.

FY2019 Consolidated Financial Results

19Consolidation of Overseas Subsidiaries
Two non-consolidated subsidiaries are consolidated in FY2020.
ReasonTheir materiality in financial statements increased.
• Business expansion of the UAE subsidiary• launch of production at the Chinese subsidiary (completion of a new plant)

Name

ADEKA AL OTAIBA MIDDLE EAST

Business

Manufacture and sales of polymer additives,
Sales for Chemicals and Foods

Established

April 2011

Location

Abu Dhabi, UAE

Name

ADEKA FINE CHEMICAL (ZHEJIANG)

Business

Manufacture and sales of chemical products
such as polymer additives

Established

January 2017

Location

Zhejiang, CHINA
FY2019 Consolidated Financial Results

20Prospects of Market Environment in FY2020
World economy : May enter a recession phase and slowdown
may be prolonged
Slowdown in growth of the Chinese
economyClimate change and unseasonable
weatherContinuous export issue between
South KOREA and JAPANFluctuations in oil and resource
pricesAutomotive

IT・Semiconductor

Food

Demand decreases globally andconcerns over stagnation of
production activities rise.

Mid- and long-term growth willcontinue despite concerns overa decline in consumption.

Demand for inbound tourism
significantly declines.

Interruption of parts supply chains

Increase in investment in 5G
and data centers

Prolonged U.S.-CHINA trade friction
Global tightening of environmental
regulations

Increase in investment in CASE

Connected／Autonomous／
Shared & Services／Electric & Weight saving

Safety and security

Tastiness

Reorganization of LCD industry

Reduction of food waste andincrease in productivity

Rapid increase in teleworking

Rise in health consciousness

FY2019 Consolidated Financial Results

21

The FY2020

Business Strategy “Polymer additives”
Automobile／Packaging related／IT, Home appliances, Building materials

Target market

Increase the sales of original products thathave technological advantages

Improve the sales of general-purpose
antioxidants
Raise price competitiveness by reducing thetotal cost of the process from material
procurement and product supply.
Increase sales in the global market

CHINA

USA

EUROPEMIDDLEEAST

1

Increase global sales of high-performance
nucleating agent

2

Boost sales of intumescent flame
retardants

3

Strengthen sales of PVC stabilizers andplasticizers through environmental
products

Improve global production and supply systems


Full operation of the new, completed Chinese plant(Zhejiang Province)
Early start of mass production using new additive
facilities at the Mie plant

Mie Plant

High-performance
additives equipment

FY2019 Consolidated Financial Results

22

The FY2020

Business Strategy “Electronics and IT materials”
Target market

Display／Semiconductor／Electronic parts

Boost sales of optical materials
particularly in Asia

1

Photo(Light)
Curing Resin
Photoinitiatorphotoacidgenerator

2

3

Boost sales of materials for optical films
and accelerate business in CHINA
Boost sales of new products for large panel
Color filter
Boost sales for use in semiconductor
lithography

Boost sales of Etchants for LCD panel
in JAPAN

Boost sales of products for advanced
DRAM and expand business domains
Current DRAM
and NAND

Stable supply of
existing products

Advanced DRAM＋

New highly dielectricmaterial

In addition to use for
DRAM and NAND,

In addition to KOREA andJAPAN markets,

improve acceleration of
the use for logic ICs

expand to CHINA andthe US markets

Growth in demand for advanced semiconductor memory due to acceleration of 5G and teleworking
Electronic device

DRAM
NAND
Demand growth andimproved high functions

Base station

DRAM･NAND
Mitigation/elimination of
network congestion
FY2019 Consolidated Financial Results

Data center

DRAM

NAND

High-speed data processing

23

The FY2020

Business Strategy “Functional chemicals”“Related to automobiles and transportation”

Target market

Lubricant／Cosmetics, toiletries／Coating, adhesion related
Contribution to ship industry

LubricantOcean vessels

Past efforts
Product capacity “Functionality”• Risk of problems in device operation increased due tochanges in fuel oils
• Demand for fuel additives grew in view of safe operation

Fuel additive for ships "ADEKA ECOROYAL" series
Low-sulfur fuel oils
Anti-wear
agents“Electronic parts, infrastructure”

with SOx scrubber
Sludgedispersant

Antifungal
agentsPrevious sea areas under environmental regulations (ECAs)

The North Sea
The North American

Problem solving Technical support

Provided technical support such as fuel oil
analysis using the strengths of a chemical
manufacturer

Supply system

Built product logistics and supply systems at
major overseas ports
Key policies
Product development meeting Customers’ needs(one-stop system)

Building cooperative systems with facility
manufacturers

The Baltic Sea

The United States Caribbean Sea

Application of SOx regulations was expanded to allsea areas in January 2020.
* ECA：Emission Control Area

Recognized by large shipping companies, increasedordersBuild new platforms and aim to increase sales in
global market.
FY2019 Consolidated Financial Results

24

The FY2020

Business Strategy “Food products”
Target market

Baking／Confectionery／Western confectionery, dessert

Boost sales of products that contribute to food waste reduction

FY2020 “RISU BRAND” New products Margarine for kneading “Marvelous”
1

Solve labor shortages by increasing work
efficiency

2

Reduce food waste by extending bestbefore period

Conventional
product• Ready for use(no need to control temperature)• Easy to knead oil into dough• No need for precision tasks

Expiration dateextended to 1.5 times

Marvelous• Moisture and savory characteristics of freshly
baked bread are maintained.
• Quality is maintained and best-before period
can be extended.
• Dough becomes stable and rejected products
can be reduced.

Expand the product into one that sells more than a billion yen.
Use of sustainable raw materials and appeal to health-conscious consumers● All raw materials (palm oil) of new products for FY2020 meet the RSPO standard.
● Promote products with low trans-fatty acid introduced ahead of the industry (continue)
FY2019 Consolidated Financial Results

25

The FY2020

Business Strategy “Life science”
Target market

Agrochemicals／Pharmaceuticals／Regenerative medicine, Preventive medicine,
Improvement of the quality of life

Domestic sale of agrochemicals
1Overseas sale of agrochemicals

Promote sales of products such as Parade,a fungicide product for gardening
Completed registration of agrochemicals for cabbage etc. to
be used for cell seedling irrigation in January 2020.

2

 INDIA

1

Raise the sales base and improve
manufacturing function for ingredients.

2

Accelerate the development of Orchestra,a new insecticide for rice paddies.

Increase and promote mainstay products
developed in house

Chemical Products, Pharmaceuticals

Insecticide for horticultural and turf “PHOENIX”

1

Boost sales of mainstay products in thetermite chemical category.

2

Boost sales of Luliconazole in thetrichophytosis unguium category.

Insecticide for horticultural “COLT”
Acaricide for horticultural “DANIKONG”

Promote activities for Smart Agriculture

Started distribution service
in April 2020.

Smartphone app, Raimy’s AI Diagnosis for Pests andWeeds (rice paddy version)

App for agrochemical adjustment support

Tool for finding information on agrochemicals appropriate for thecontrol of pests and weeds that grow in agricultural products andcultivated land (part of producer support by raising efficiency ofagricultural production)

Chatbot service for agrochemicals
Development of products suitable for drone spraying

FY2019 Consolidated Financial Results

26

４．Progress of mid-term management plan
“BEYOND 300”

27

The mid-term management plan

Progress of "BEYOND 300"

FY2018 Performance

FY2019 Performance

FY2020 Target

1st year of BEYOND 300

2nd year of BEYOND 300

Final-year of BEYOND 300

Consolidated sales

299.3 billion yen

304.1 billion yen

Organic growth

255.0 billion yen

238.8 billion yen

Operating income margin

8.9％

7.4％

10％

ROE

8.5％

7.3％

10%

Investment and finance36.2 billion yen／year

17.2 billion yen／year

100 billion yen／3 years

Capital investment

17.4 billion yen／year

17.2 billion yen／year

50 billion yen／3 years

18.8 billion yen execution－

50 billion yen／3 years

Dividend payout ratio

Dividend payout ratio

27.1%

32.5%

M&A funds

Over 300 billion yen- Via organic growth -Dividend payout ratio

Dividend

30%(Target for the final year of the plan
after incremental increases)

Organic growth : Aims to reach sales exceeding 300 billion yen with business growth from polymer additives, chemicals and food products.
- Excluding contributions from M&A -FY2019 Consolidated Financial Results

28Basic strategies：Global expansion of three main businesses

Scale up with new products

IT・Semiconductor

Food Trend of sophistication ofelectronics continues due todiffusion of 5G communications.

 New demand is appearing forcontribution to reduction offood waste and labor shortages.

Polymer additives

Chemicals

Food products

Nucleating Agentfor polypropylene

High-k material

Automotive
 Activities to promote nextgeneration cars increased.

 Adding it to PP resin makes
the material stronger andthinner Reduce weight of car bodywhile maintaining rigidity,
increasing fuel efficiency

 Makes thin and even DRAM
capacitors
 Contributes to developmentof very large memory,device miniaturization andcost saving

Whipping creamfor frozen andchilled desserts
 Cream whose flavor andmouthfeel do not change
after freezing and thawing
 Enable for delivery infreezing and unfreezing
only the necessary portion,
helping reduce food loss

Develop products considering market changes
to expand business in polymer additives, chemicals and foods
FY2019 Consolidated Financial Results

29Basic strategies：Global expansion of three main businesses

Sales Promotion of Semiconductor Peripheral Material
Consumer needs
Challenges ofsemiconductor resist makerPursuit of comfort with high performance electronic devices
Advanced lithography technology to support fine semiconductors

Photoacid generators “ADEKA ARKLS” series

i-lineKrF

ArF・Dry

ArF・Immersion

EUV/ Next-gen

Sales expanded with the semiconductor photoresist material(ArF immersion)
Form fine circuits / suppress metal impurities

2

3

The semiconductor industry starts mass-production with EUV
exposure equipment, which will expand to full-scale in the future.

Focus on development of new photoacid generators

Product development for lithography”
Layer “M wiring

1

Reinforce production systems on semiconductor
peripheral materials such as photoacid generators

 Usage amount increased by users
 New adoption by users

Expand materials for semiconductor multilayer resist

by applying the technology accumulated in photoacid generators

Transistor

FY2019 Consolidated Financial Results

Si基板




Photoinitiator
Photoacid generators“KrF/i-line”



Photoacid generators“ArF/EUV”

Other peripheral
materials for
multilayer resist30Basic strategies：Global expansion of three main businesses

Application Expansion of Fiber Reinforced Plastic
Fiber to composite Direct Molding Process “ADEKA Lasimec” series

×

Joint development

Enable FRP formation that is mold free, short curing, with high rigidity
Market needs
Automotive (body)Wind-power generation(blades)

Infrastructure (bridges)

・ Low fuel consumption, energy
saving・ Shift to EV, higher performance・ Renewable energy expansion
・ Power generation efficiency
improvement

・ Aging infrastructure increase
・ Stricter regulations on seismic
reinforcement

Propose to various markets and accelerate FRP application expansion
FY2019 Consolidated Financial Results

31Basic strategies：Entering new domains

Create synergy with NIHON NOHYAKU

×R&D

Industrial science
Establish the entrusting
manufacture system
between both companies

Purchasing& Distribution

OthersCo-purchasing and/or
commonality for raw
materials.

Unification of financial period,
Link management accounting
systems

Determined theme of joint research and development

Conglomerate two companies' technologies to work on creating new
inventions

Quick commercialization of
medical materials
 Acquire evaluation methods
in the life science field Share and use compound
databases Commercialize seed research

Stimulate researcher
exchange

System reinforcement ofagricultural chemicals
and drug businesses
 Develop new chemicals anddrugs
 Apply ADEKA's existing
technologies to agriculture

FY2019 Consolidated Financial Results

32Basic strategies：Entering new domains

Commercialization plan for life science business
Decellularized tissue

33
Present

Verification offeasibility

Review for
production

Preclinical trials

Clinicaltrials
FY2021 Target

Sales of products

Obtained ISO 13485 certification and started delivering samples

Bovine’s decellularized pericardium
Causes less rejection when implanting toorganism and function as a scaffold for cells(settlement and rebuilding of cells)

1

Proposing to and hearing needs frommedical institutions globally

2

Establishing a safe supply chain

FY2019 Consolidated Financial Results

33Basic strategies：Entering new domains

Promote commercialization in the environment and energy
Materials forHighcapacitylithium-ion batteries “LiB”
Electrode active material
SPAN
1 FY2021
FY2022～

Long life

Nano carbon material
Graphene
2 FY2021
FY2022～高い
Thermalconductivity

Rare-metal-freeProminent battery
Better charge/discharge
safety in short-circuit
cycle property

Application•

SafetyMechanical strength

Conductivity

Application

Electrode active material of LiB“Next-gen LiB such as all solid-state batteries”•

Conductive material for LiB•

Functional filler for next-gen electronic
devicesAnd for other applications

Pilot plant completed at Soma,
started providing test samples

Advancing evaluation in automotive and battery manufacturers

Batteries for xEV, ESS etc.

To develop next-gen LiB such as all solid-state batteries

FY2019To improve current LiB (by replacing materials)

FY2020A small-quantity production facility will be
installed in the Mie Plant.
Increase the number of customers forsample provision.

FY2021Development andapplication expansion

SPAN

Launch (plan)

FY2019 Consolidated Financial Results

FY2022 and later
Graphene

Launch (plan)34

Expected roles and effects of our LIB materials
LiB Materials under development
Electrolyte additive

Supports smooth passage of lithium ion
Long life “preventing deterioration of battery
performance”
Safety ”preventing fuming and firing”

Electrode active material SPAN
• hold and release lithium ions
• can be used as cathode and anode

Safety “Lowering the risk of fuming and firing”
Long life
Weight saving

Conductive material Graphene

This enhances the charge/discharge performance byincreasing conductivity of positive and negative electrodes.



Improved charging speed
Long life

FY2019 Consolidated Financial Results

35Basic strategies：Enhancing our management foundation

CSR priority issues

Priority Issue

Priority Domain

Ｅ

Conserve global environment
Environment
Supply of eco-friendly products

Better living
conditions
communication

Ｓ
Human rights,
human resources

Ｇ

Governance

Create value that meets
society’s expectations
Conduct dialogue with stakeholders
Respect human rights
Expand the opportunities forutilizing human resources
Enhance group governance and risk management

FY2019 Consolidated Financial Results

36Social：Measures against COVID-19
Current

Prioritize the reduction of infection risk at workplaces Mandate temperature measurement when arriving at the office and comingback from work, and health management
 Ensure hand washing, mask wearing and alcohol disinfection
 Deliver masks to employees in collaboration with Group companies in Japanand overseas

Diversify workstyles through remote work

 Lend computers and Wi-Fi for remote work to employees and have themwork from home
 Encourage staggered working hours and conduct rotation work at offices
 Manage long-distance business trips and shift to online meetings internallyand externally

FutureContinue remote work and promote digitization of work
Advance workstyle diversification to improve work-life balance, encourage
personal empowerment and foster highly skilled human resources
Expand opportunities for employees to play an active part even after thestart of the new normal
FY2019 Consolidated Financial Results

37

FY2020 Capital Investment Policy
Ongoing capital investments will continue, and new capital investments
will halt.
While examining the situation, we will develop an investment plan tosupport mid-to-long term growth.
Segment

Area

Products

USA

Polymer additives
／new

KOREA

Semiconductor material for DRAM
／expansion

JAPAN/
Chiba

Semiconductor peripheral materials／expansion

Functional
chemicalsJAPAN/
Soma

Lubricant additive related／expansion

Food productsJAPAN/
KashimaRaw oil storage tank／expansion

Polymer additives

Electronics and IT
materials

FY2019 Consolidated Financial Results

Completion time

By the end of
FY2020 (planned)

38

５．For Reference

39

Slogan for 2020 - For reference -FY2019 Consolidated Financial Results

40Overseas Sales - For reference -Unit: 100 million yen

50%

46.9%
41.5%

46.2%

42.3%

40%

4,000
2,993

3,041

30%

3,000
2,234

20%

927

2,396
1,405

Overseas sales
Domestic sales
Overseas sales ratio
Sales

1,404
2,000

1,012

10%

0%

5,000

1,307

1,383

1,588

FY2016
927
1,307
41.5%
2,234

FY2017
1,012
1,383
42.3%
2,396

FY2018
1,405
1,588
46.9%
2,993

1,636

FY2019
1,404
1,636
46.2%
3,041

1,000

0

Note : Figures are expressed in units of 100 million yen and have been rounded off.

FY2019 Consolidated Financial Results

41

The FY2019

Supplemental Documents for
Financial Results Overview
Ⅰ.Supplementary Data for consolidated Closing of Accounts
Ⅱ.Management indexes, etc.
Ⅲ.For information purposes:◆Overview of non-consolidated and consolidated closing accounts◆Overview of ADEKA Group◆Core products of each business segments

42

Ⅰ. Supplementary Data for consolidated Closing of Accounts

1.Consolidated Balance Sheet

Consolidated
Unit: million yen
increase/decrease

As of Mar 31, 2019

As of Mar 31, 2020

AssetsCurrent assets
Fixed assets
Tangible fixed assets
Intangible fixed assets
Investment and other assets
Total assets ①

233,087
181,462
108,672
17,59655,193
414,549

227,635
181,816
113,230
16,37052,216
409,452△ 5,452354
4,557△ 1,226△ 2,976△ 5,097

Liabilities
Current liabilities
Long-term liabilities
Total liabilities ②

107,156
62,893
170,049

92,704
66,114
158,818△ 14,452
3,220△ 11,231

190,772
22,94420,023
148,630△ 825
13,807201,41222,994
19,986
158,872
△ 441
8,854

10,63950△ 37
10,242384△4,953

10,098
4,253
1,867

6,541
4,253
155

△ 3,556－△ 1,712△ 2,41139,919244,500
414,549△ 2,096
40,367
250,634
409,452

315
447
6,133
△ 5,097

Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Accumulated other comprehensive income
Valuation difference on
available-for-sale securities
Reserve for land revaluation
Translation adjustment
Adjustments for retirement
Benefits
Minority interests
Total net assets
Total liabilities and net assets

Unit: 100 million yen
POINT①
Decrease in total assets△ 50

Decrease in notes and accounts
receivable - trade△ 86

POINT②
Decrease in total liabilities

Note : Figures are expressed in units of million yen and have been rounded off.
FY2019 Consolidated Financial Results

Decrease in notes and accounts
payable - trade

△ 112
△ 101

43

Ⅰ. Supplementary Data for the Consolidated Closing of Accounts

2. Cash Flow Statement

Consolidated
Unit: million yen

FY2018from April 1, 2018 to March 31, 2019

FY2019from April 1, 2019 to March 31, 2020

Cash flows from operating activities

18,331

27,398Cash flows from investing activities△ 18,258△ 15,228

Cash flows from financing activities

8,995△ 7,496△ 1,465

△ 290

7,602

4,383

Cash and cash equivalents at the beginningof period

48,90256,504

Cash and cash equivalents at the end of period

56,50460,888

Effect of exchange-rate changes on cash
and cash equivalents
Net increase/decrease in cash and cash equivalents increase)

Note : Figures are expressed in units of million yen and have been rounded off.

FY2019 Consolidated Financial Results

44

Ⅱ. Management Indexes, etc.

1. Profitability

Consolidated

yen
200

10%

150

8%

100

5%

50

3%

0
EPS
ROE
ROA

FY2016¥149.08.9%
7.8%

FY2017¥149.28.1%
7.4%

FY2018¥165.88.5%
7.3%

FY2019 Consolidated Financial Results

FY2019¥147.7
7.3%
5.3%

0%

45

Ⅱ. Management Indexes, etc.

2. Dividend payout ratio and dividends

Consolidated

million yen
6,000

35%

4,000

30%

2,000

25%

0
Dividend per share
Total Dividend
Dividend payout ratio

FY2016
¥35
3,621
23.5%

FY2017
¥39
4,037
26.1%

FY2018
¥45
4,661
27.1%

FY2019
¥48
4,975
32.5%

20%

Note1 : Dividends in FY2016 include a commemorative dividend of 5 yen in commemoration of the 100th anniversary of our founding.
Note2 : Figures are expressed in units of million yen and have been rounded off.
FY2019 Consolidated Financial Results

46

Ⅱ. Management Indexes, etc.

3. Research and development costs

Consolidated

million yen
15,00010%

12,000

8%

9,000

6%

6,000

4%

3,000

2%

0
R&D cost
Rate of R&D cost to sales

FY20168,735
3.9%

FY20179,327
3.9%

FY2018
11,8294.0%

FY201914,3984.7%0%Note : Research and development expense are expressed in units of million yen and have been rounded off.

FY2019 Consolidated Financial Results47

Ⅱ. Management Indexes, etc.

4. Capital investment

Consolidated

million yen
20,00015,00010,0005,000

0Capital investment
Depreciation costs

FY2016
12,0779,230

FY2017
15,1229,666

FY201817,41911,659FY201917,281
14,248Note : Capital investment and depreciation are expressed in units of million yen and have been rounded off.

FY2019 Consolidated Financial Results48

Ⅱ. Management Indexes, etc.

5. Interest-bearing liabilities

Consolidated

million yen

60,00030%

40,00020%

20,00010%

0Interest-bearing deptInterest-bearing dept ratio

FY201632,10811.1%

FY201730,8289.9%

FY201860,99314.7%

FY201960,85214.9%

0%Note : Liabilities with interest are expressed in units of million yen and have been rounded off.
FY2019 Consolidated Financial Results

49

Ⅲ. For information purposes

1. Overview of non-consolidated and consolidated closing accounts
Non-consolidated
Consolidated

Unit: 100 million yen

Domestic companies (11)Non-consolidated closing of accounts

FY2018FY2019

Increase/decrease

Increase/decrease ratio : %

926

901

△ 24

△ 2.7

19

15

△3

△ 17.6FY2018FY2019

Increase/decrease

Increase/decrease ratio : %

1,346

1,286

△ 60

△ 4.5

Operatingprofit

122

99

△ 22

△ 18.3Current
profit

157

131

△ 26

△ 16.5

Overseas companies (16)NET profit
for the Term

124

118

△6

△ 5.0

FY2018FY2019

Increase/decrease

Increase/decrease ratio : %

120.6

114.5

1,579

1,364

△ 214

△ 13.6

105

92

△ 12

△ 12.0Sales

NET profit
per share
for the Term

OperatingprofitOperatingprofitSales
OperatingprofitNIHON NOHYAKU (10)
Sales

Sales

Consolidation adjustment accounts (deleted)

FY2018FY2019

Increase/decrease

Increase/decrease ratio : %

344

604

259

75.5

37

34

△3

△ 8.1

FY2018
Sales
Operating profit

FY2019△ 1,201△ 1,114

△ 17

△ 17

Note : Figures are expressed in units of 100 million yen and have been rounded off.
FY2019 Consolidated Financial Results

50

Ⅲ. For information purposes

2. Consolidated Subsidiaries - 16 companies in Japan① Controlling
Share : %Segment

Consolidated subsidiary

CapitalLine of business

Chemicals

ADEKA CHEMICAL SUPPLY CORP.

¥ 104million

Chemicals

ADEKA CLEAN AID CORP.

¥ 140million

100.00Chemicals

OXIRANE CHEMICAL CORP.

¥ 600million

51.00 Manufacturing and sales of epoxy plasticizers, etc.

Foodproducts

ADEKA FOOD SALES CORP.

¥ 42million

100.00

Sales of edible processed oils and fats for confectionary andbreads, and sales of other foodstuffs, etc.

Foodproducts

YONGO CO.,LTD.

¥ 18million

92.64

Wholesaling of ingredients for confectionery and bakery
business use.

100.00 Sales of chemical products, and the development,(Indirect ownership:5.57) manufacturing and sales of metal processing oils, etc.

Development and sales of kitchen detergents for commercial
use, industrial detergents, etc.

Foodproducts

ADEKA FINE FOODS CORP.

¥ 50million

Manufacturing and sales of mayonnaise products, oil and fat
100.00 processed food products and processed products using
seafood.

Food
products

UEHARA FOOD INDUSTRY CO.,LTD.

¥ 70million

100.00

Manufacturing and sales of flour paste products, bean-jams andretort pouch foods.

Food
products

CROWN CO.,LTD.

¥ 10million

100.00Wholesale business of food materials such as fatty oils, flour
milling and flavors and processed foods.

FY2019 Consolidated Financial Results

51

Ⅲ. For information purposes

2. Consolidated Subsidiaries - 16 companies in Japan② Segment

Consolidated subsidiary

Controllingshare : %CapitalLine of businessAgrochemicals, Wood Preservative, Agricultural Materials,
Pharmaceuticals & Veterinary ProductsLife science

NIHON NOHYAKU CO.,LTD.

¥14,939million

51.00Life science

NICHINO RYOKKA CO.,LTD.

¥160million

100.00(Indirect ownership:
100.00)

Sales of Chemical/Pesticides for Professional Turf, Planning for
GOLF Courses and Amenity Areas

Life science

NICHINO SERVICE CO.,LTD.

¥3,400million

100.00(Indirect ownership:
100.00)

Production and Logistic Services of Agrochemical, Cultivation& Management of Experimental Field/Laboratories

Life science

NIHON ECOTECH CO.,LTD.

¥20million

100.00(Indirect ownership:
100.00)Agrochemical Residue Analysis, Chemical Substance Safety
Testing, and Related Activities

Life science

AGRIMART CORP.

¥50million

100.00(Indirect ownership:
100.00)

Sales of Termite Control Agents/Devices,
Pest Control Agents/Devices

Others

ADEKA LOGISTICS CORP.

¥ 50million

100.00General and principal contracting of logistics for the company,
warehousing, leasing of vehicles, etc.

Others

ADEKA ENGINEERING &CONSTRUCTION CORP.

¥ 130million

100.00Design, construction, and construction supervision of facility
plants, and facilities maintenance.

Others

ADEKA LIFE-CREATE CORP.

¥ 65million

100.00 Trading, brokerage and management of real estate, property(Indirect ownership: and life insurance agency, sales in the OA equipment area, and20.00) management of buildings and company-owned apartments

FY2019 Consolidated Financial Results

52

Ⅲ. For information purposes

3. Consolidated Subsidiaries - 23overseas companies① Consolidated subsidiary

CapitalControlling
Share : %Country

Segment

U.S.

Chemicals

ADEKA USA CORP.

US$1 million

100.00

Sales of chemical products.

U.S.

Chemicals

AMFINE CHEMICAL CORP.

US$16 million

60.00

Manufacturing and sales of polymer
additives.

100.00(Indirect ownership:
100.00)100.00(Indirect ownership:
100.00)50.00(Indirect ownership:
50.00)

Line of business

Manufacturing and sales of polymer
additives.

U.S.

Chemicals

AM STABILIZERS CORP.

US$8.5 million

U.S.

Life science

NICHINO AMERICA, INC.

US$0.7 million

BLAZIL

Life science

SIPCAM NICHINO BRASIL S.A.

R$5 million

GERMANY

Chemicals

ADEKA Europe GmbH€0.5 million

100.00FRANCE

Chemicals

ADEKA POLYMER ADDITIVES EUROPE SAS€3 million

100.00(Indirect ownership:
100.00)

CHINA

Chemicals

ADEKA (CHINA) CO., LTD.

US$31 million

100.00

CHINA

Chemicals

ADEKA FINE CHEMICAL (SHANGHAI)
CO., LTD.

US$20.5 million

100.00

CHINA

Chemicals

ADEKA FINE CHEMICAL (CHANGSHU)
CO., LTD.

US$21.54 million

50.00

Manufacturing and sales of polymer
additives, functional resins, electronicmaterials and similar products.
Manufacturing and sales of polymer
additives.

CHINA

Food products

ADEKA FOODS (CHANGSHU) CO., LTD.

US$23 million

70.00

Manufacturing and sales of processed oils
and fats, processed foods.

CHINA

Chemicals

ADEKA FINE CHEMICAL (ZHEJIANG)
CO.,LTD. *US$30 million

100.00(Indirect ownership:
100.00)

Sales and R&D of agrochemicals in
America
Production and sales of agrochemicals inBlazilSales of chemical products.
Manufacturing and sales of polymer
additives.
Sales of chemical products.

Manufacture and sales of chemical
products such as polymer additives.

Note: Companies with an asterisk (*) were included in the scope of consolidation in FY2020.
FY2019 Consolidated Financial Results

53

Ⅲ. For information purposes

3. Consolidated Subsidiaries - 23overseas companies② Consolidated subsidiary

Segment

TAIWAN

Chemicals

CHANG CHIANG CHEMICAL CO., LTD.

NT$30 million

50.50

Sales of polymer additives andplasticizers .

TAIWAN

Chemicals

ADEKA FINE CHEMICAL TAIWAN CORP.

NT$200 million

100.00

Manufacturing and sale of chemical
products.

TAIWANLife science

TAIWAN NIHON NOHYAKU CO.,LTD

NT$40 million

INDIA

Life science

NICHINO INDIA PVT. LTD.

₹3.85 million

INDIA

Life science

NICHINO CHEMICAL INDIA PVT. LTD.

₹10.5 million

SOUTH
KOREA

Chemicals

ADEKA KOREA CORP.

₩15 billion

100.00

Manufacturing and sale of chemical
products.

THAILANDChemicals

ADEKA FINE CHEMICAL (THAILAND)
CO.,LTD.

‼ 350 million

81.00

Manufacturing and sale of chemical
products.

SINGAPORE

Chemicals

ADEKA (ASIA) PTE.LTD.

US$ 0.8 million

100.00

Sales of chemical products.

SINGAPORE

Food products

ADEKA (SINGAPORE) PTE.LTD.

S$8 million

90.00

Manufacturing and sales of processedoils and fats, frozen piecrusts andrelated food products.

Malaysia

Food products

ADEKA FOODS (ASIA) SDN.BHD.

MYR90 million

60.00

Manufacturing and sales of processedoils and fats.

UAE

Chemicals

AED45.46 million

49.00

Manufacture and sales of polymer
additives, Sales for Chemicals and Foods

ADEKA AL OTAIBA MIDDLE EAST LLC *CapitalControlling
Share : %Country

51.00(Indirect ownership:
51.00)
100.00(Indirect ownership:
100.00)100.00(Indirect ownership:
100.00)Line of business

Sales and R&D of agrochemicals in
TaiwanProduction, sales and R&D of
agrochemicals in India
Production and sales of agrochemicals
in India

Note: Companies with an asterisk (*) were included in the scope of consolidation in FY2020.

FY2019 Consolidated Financial Results

54

Ⅲ. For information purposes

4. Equity method - applicable companies Equity method-applicable companies

CapitalControlling
Share : %Line of business

CO-OP CLEAN CO., LTD.

¥80 million

46.88

Development and sales of soap, detergents and similar
products.

SHOWA KOSAN CO.,LTD.

¥550 million

20.81

Sale of synthetic resins, chemical products, industrial materials,
electronic materials and environmental concerns.

AGRICULTURAL CHEMICALS(MALAYSIA) SDN. BHD.

SIPCAM EUROPE S.P.A.

MYR2.05 million€36.94 million

24.18(Indirect ownership:
24.18)

20.00(Indirect ownership:
20.00)

Production and sales of agrochemicals in Malaysia

Production and sales of agrochemicals in Europe

FY2019 Consolidated Financial Results

55

Ⅲ. For information purposes

5. Core products of each business segments
Business category

Core products
Polymer
Additives

Chemicals
Reportingsegment

Additives for polyolefins, PVC plasticizers/stabilizers, Flame retardants,
and others.

Electronics andIT materials

High-purity materials for semiconductors, AFES System and etching agents,
Photo(Light)/heat curing materials, photoinitiators, Imaging materials,
and others.

Functional
Chemicals

Epoxy resins, Polyurethanes, Water-borne resins, Surfactants, Lubricant
additives, Kitchen detergent, Cosmetic ingredients, Polypropylene glycol,
Hydrogen peroxide and derivative products, Water-swelling sealingmaterials, and others.

Food products

Margarines, Shortenings, Oil and fats for chocolate, Oils and fats for frying, Whipping cream,
Kneading cream, Fillings, Frozen pie crusts, Mayonnaise dressing, functional foods,
and others.

Life science

Agrochemicals, Agricultural materials, Pharmaceuticals＆Veterinary products,
Wood preservative, and others.

Other business

Designing of equipment plants, Construction and construction management, Maintenance ofequipment, Logistic services, Warehousing, Leasing of vehicles, Real estate and insurance
business, and others.

FY2019 Consolidated Financial Results

56

Notice on Forecast Performance and Business Plans

The forecast performance and business plans specified in thisdocument have been prepared based on information available
as of the date of publication, as well as on various
prerequisites; therefore, the actual results may differ fromthese forecasts or plans depending on various factors that
may arise hereafter.

FY2019 Consolidated Financial Results

57