04

Our Profile

Eiken Chemical was founded in 1939, and it has contributed topublic health and the control of communicable diseases in Japanever since through the development of bacteria examination
reagents (culture media) for infectious diseases. In various
fields such as urinalysis, clinical chemistry, immunological,serological, and genetic examinations, it has developed theclinical examination reagents, medical equipment, and systems
needed for medical care in each successive era, contributing to theadvancement of medical care and improvement of people’s health.

INDEX

Value Creation Story

Our StrategyCorporate Governance

Our Profile

Eiken Chemical’s Businesses
Overview of business

Clinical diagnostics market

Manufacture and sale of pharmaceuticals, reagents, and medical, physical, and chemicalmachinery and equipment, as well as the import and export for sale of the same. Ourproducts are a familiar part of life for everybody from babies to senior citizens.

Domestic market¥

729.3 billion

Annual growth2(FY2021; source:of%forecast

survey by the Japan Associationof Clinical Reagents Industries)

Business domains
Clinical diagnostics

Global market

Clinical diagnostics are a kind of test used in diagnosis, treatment, and screening of disease, and can becategorized into laboratory tests and physiological function tests. As a comprehensive manufacturer ofclinical diagnostics, Eiken Chemical responds to the needs of the most advanced medicine through theresearch and development, manufacturing and sales of products and services that cover a wide range of98.2 billion

Annual growth ofUS$(FY2021)(Report Code: MD3609)

3

approx. %forecast(average 2021-2026)

laboratory tests.

The size of the clinical diagnostics market wasapproximately ¥729.3 billion in FY2021. In order
to control medical expenses, governments arestrengthening their promotion of preventive healthcare, such as by increasing the rate of uptake forSpecific Health Checkups and cancer screening,
and the volume of clinical diagnostics is projected
to increase going forward. Over the medium term,
the market is forecast to trend gently upwards at anannual rate of about 2%.
The size of the global market for clinical diagnostics
was approximately US$98.2 billion in FY2021.
The market itself is enormous, at more than tentimes the size of that of Japan, and is expected togrow at an annual rate of more than 3% due toincreases in medical examinations driven by theaging populations in advanced countries, and theeconomic growth and expansion of medical demandin developing countries.

Clinical diagnostics

Business model
Laboratory tests

Physiological function tests

Tests that use a specimen extracted
from the human bodyTests that inspect
the human body directly

Comprehensive manufacturer of clinical diagnostics
Eiken Chemical

Equipment suppliers

General tests urine/feces etc.
Blood tests

Electrocardiogram tests
etc.

Electroencephalograms testsUltrasound tests

Clinicaldiagnostics
field

Medicalwholesalers/
overseas agents

Blood pressure tests etc.
Raw ingredientsuppliers

Testing of food and environment
for environmental inspection to measure contamination of work environments, and sells testing tools

Hospital/clinic screening centers

Food/environmental
testing field

Eiken Chemical manufactures and sells reagents of microbiological tests for food poisoning bacteria andand devices.

Test centers

Reagent suppliers

Patients/others
receiving screening

Wholesalersof physical/
chemical-related
products
Food/pharmaceuticalcompanies, etc.

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Value Creation Story

Our Strategy

Corporate Governance

Our Profile

Main Products and Services
As a comprehensive manufacturer of clinical diagnostics, the Eiken Group offers a broad lineup of products and services.

Microbiological reagents

Medical devices

10.1%

Test reagents that are useful in the diagnosis andtreatment of microorganism infections, such ascultures for bacteria testing, rapid test reagents, andreagents for drug sensitivity testing.

Microbiologicalreagents

9.1%

Urinalysis test strips

9.6%

Molecular test (LAMP)

17.0%

Salescomposition
immunochemical
by product type Fecal
tests reagents(FY ended Mar. 31, 2023)

Equipment/
culture mediums
related to foodand environment

5.0%

Clinical chemistry
test reagents

1.4%

Immunological andserological reagents

25.9%

Fecal immunochemical
tests reagents
Test reagents used to detect occult blood in feces forcolorectal cancer screening (primary testing).

Clinical chemistry
test reagents
Test reagents for automated analyzers used tomeasure biological components in blood serum andurine, primarily for test items that are of interest for
their association with lifestyle-related diseases.

Urinalysis test strips
Test reagents such as urine analysis test strips for
detecting various items in urine, such as urobilinogen,occult blood, protein, and glucose.

Immunological andserological reagents
Measurement of infectious diseases, rheumatism,hormones, and tumor markers. Test reagents forneonatal metabolic disorders, gastric cancer risk
assessment test (ABC risk classification), and others.

Equipment/culture
mediums related tofood and environment
Reagents of microbiological tests for food poisoning
bacteria and for environmental inspection to measurecontamination of work environments, as well as tools
and devices for such tests.

22.0%

Molecular test (LAMP)
Genetic testing products using Eiken Chemical’s
unique LAMP method technology to test for infectious
diseases such as COVID-19 and tuberculosis. We arerolling it out into a wide range of fields, including foodand environment.

Medical devices
Various types of automated analyzers that use ourin-house reagents for a variety of tests.

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Value Creation Story

Our Strategy

Corporate Governance

Our Profile

Financial Highlights
FY ended Mar. 31, 2018

FY ended Mar. 31, 2019

FY ended Mar. 31, 2020

FY ended Mar. 31, 2021

FY ended Mar. 31, 2022

FY ended Mar. 31, 2023

Net sales

Million yenof which overseas sales

Million yen

5,405

6,070

7,040

6,895

8,868

8,797

Gross profit

Million yen

14,701

15,692

16,22918,52920,56420,506

Operating profit

Million yen

3,478

4,611

4,622

6,612

8,387

7,457

Ordinary profit

Million yen

3,549

4,681

4,723

6,808

8,508

7,568

Net profit attributable to owners of parent

Million yen2,608

3,447

3,538

5,044

6,218

5,736

Total assets

Million yen

45,16547,27950,322

55,68562,512

66,275

Net assets

Million yen

32,47835,01437,303

41,67245,80349,535

EBITDA (operating profit + depreciation and amortization)

Million yen

5,138

6,205

6,249

8,323

10,445

9,582

Research and development expenses

Million yen

3,238

2,904

3,333

3,086

3,408

4,065

Capital investment

Million yen

1,102

1,685

2,985

2,876

4,347

3,792

Depreciation

Million yen

1,660

1,594

1,627

1,711

2,058

2,125

Net cash (cash and deposits + short-term securities - interest-bearing debt)

Million yen

8,597

6,356

8,893

8,071

11,93014,062

Cash flows from operating activities

Million yen

4,091

3,318

5,460

5,451

7,769

7,575

Cash flows from investing activities

Million yen(3,250)(4,435)(3,711)(2,193)(5,044)(316)

Cash flows from financing activities

Million yen(1,175)(1,083)(1,220)(1,275)

1,200(2,095)

Cash and cash equivalents at end of period

Million yen

6,651

4,448

4,981

6,968

10,90016,064

Operating profit to net sales ratio

%

9.9

12.9

12.6

17.1

19.5

17.2

Return on Equity (ROE)

%

8.3

10.3

9.9

12.9

14.3

12.1

Return on Assets (ROA)

%

5.8

7.5

7.3

9.5

10.5

8.9

Equity ratio

%

71.2

73.5

73.5

74.3

72.8

74.2

Earnings per share (EPS)

Yen*71.21

93.63

95.95

136.65168.28155.17

Book value per share (BPS)

Yen*877.35

942.37

1,002.86

1,120.36

1,230.55

1,327.47

Dividend payout ratio (consolidated)

%

35.1

32.0

31.3

30.0

30.3

32.9

Dividend per share

Yen*25.0030.00

30.0041.00

51.00

51.00

Total number of issued shares at end of period

Shares43,541,438

43,541,438

43,541,438

43,541,438

43,541,438

43,541,438

Number of treasury shares at end of period

Shares6,902,222

6,659,650

6,659,760

6,611,071

6,576,861

6,512,625

Market capitalization

Billion yen

116.6

113.4

85.8

94.1

75.1

68.0

Number of employees at end of period(full-time employees + temporary employees on a consolidated basis)

Persons

1,016

1,040

1,053

1,087

1,105

1,106

34,99135,761

36,58538,667

42,99643,271*The Company conducted a two-for-one share split of its common shares with an effective date of April 1, 2018.
Figures for EPS, BPS, and dividend per share for FY ended Mar. 31, 2018 are calculated based on the assumption that the share split was conducted on April 1, 2017.

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Value Creation Story

Our Strategy

Corporate Governance

Our Profile

Non-Financial Highlights
FY ended Mar. 31, 2018

Greenhouse gas (GHG) emissions

FY ended Mar. 31, 2023

2,120

1,989

1,934

2,070

2,0161,945

t-CO₂

5,252

5,181

4,884

5,038

5,304

2,669

t-CO₂–––

86,485

105,334

84,205

Renewable energy used

4MWh

70

76

70

61

62

6,871

Water volume consumed

2

1,000 m3

88.1

83.9

81.0

78.1

80.7

73.1

Total waste generated

3 *2

517

3

Number of ecological proposals

3

4t

426

384

438

429

464

t

251

215

233

223

233

247

%

58.9

50.6

60.7

59.4

58.8

54.7

Proposals

366

445

454

318

291

518

Average age(Overall)Years

43 years 0 months

42 years 7 months

42 years 6 months

42 years 4 months

42 years 3 months

42 years 5 months

Average age(Men)Years

44 years 0 months

43 years 5 months

43 years 2 months

42 years 10 months

42 years 7 months

42 years 5 months(Women)Years

40 years 7 months

40 years 5 months

41 years 0 months

41 years 1 months

41 years 5 months

42 years 4 months

(Men)

Years

16 years 11 months

16 years 2 months

14 years 11 months

16 years 2 months

15 years 7 months

15 years 7 months(Women)Years

Average years of service

GovernanceFY ended Mar. 31, 2022

t-CO₂

Recycling ratio (including recovered energy)

4

FY ended Mar. 31, 2021

Scope 2

Material recycled

Society

FY ended Mar. 31, 2020

Scope 1
Scope 3 *1
Environment

FY ended Mar. 31, 2019116 years 0 months

16 years 1 month

16 years 6 months

16 years 9 months

16 years 10 months

17 years 7 months

Women as share of all employees

%

27.3

29.0

29.4

29.7

30.3

29.2

Percentage of managerial positions held by women(as of April each year) *3

%

10.7

12.2

14.6

16.9

16.2

13.8

Female Directors as share of Directors%0.0

11.0

11.0

11.0

11.0

13.0

Women as share of all hires

%

29.2

35.6

20.0

27.5

29.3

17.5

Percentage of returning to work after childcare leave%

100

100

100

100

100

100

Employee turnover *4

%

0.9

0.9

2.0

1.7

2.0

2.7

Average non-scheduled working hours per full-time employee per month Hours

–

14.1

15.8

16.2

15.3

14.8

Rate of uptake of EIKEN GLOBAL PROGRAM among employees *5%

–

–

–

16.5

14.0

19.4

Employee satisfaction score

––––

–

–

58.4

Rate of uptake of antibribery training%––––

96.8

100.0

Number of serious noncompliance incidents *6Cases

000000

Scope 1 GHG emissions: GHG emitted directly from company facilities, plants, and vehicles
Scope 2 GHG emissions: GHG emitted indirectly by the company as a result of energy usage
Scope 3 GHG emissions: GHG emitted by the entire cluster of companies involved in a product or service (supply chain)<Applicable scope>
1 Eiken Group: EIKEN CHEMICAL CO., LTD., EIKEN CHINA CO., LTD.
2 Eiken Group (production sites)
3 Eiken Group (headquarters/production sites/research facilities)
4 EIKEN CHEMICAL CO., LTD. only

*1 The Company calculates items within the scope in accordance with Scope 3 items based on the GHG protocol*2 Total waste generated = general waste + industrial waste + recycled waste (including recovered energy)*3 Managerial position: a post of section chief or higher*4 Numerator = number of full-time employees leaving between April 1 of each year and March 31 of the following year
Denominator = calculated as number of full-time employees on April 1 each year
*5 Rate of uptake of EIKEN GLOBAL PROGRAM = number of those attending training each fiscal year ÷ number of employees for each fiscal year
*6 The total of material infringements of a country’s competition laws, material infringements of the laws and regulations related to corruption,and material infringements in socioeconomic areas other than these

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Corporate Governance

Our Profile

External Evaluation/Stock Information, Etc.
External evaluation

Company profile

Inclusion in ESG indicesCompany name

EIKEN CHEMICAL CO., LTD.

Head office location

4-19-9 Taito, Taito-ku, Tokyo,
110-8408 Japan

Representative

Tsugunori Notomi, President & CEO

FoundedFebruary 20, 1939

Share capital

6,897,730,000 yen(as of March 31, 2023)

 SG-related third-party evaluations/E
certifications/awards

Non-consolidated: 1,047;
Consolidated 1,106(as of March 31, 2023)

Listed stock exchangeTokyo Stock Exchange
Prime Market

Securities code4549

Year-end

March 31Annual General Meeting of Shareholders

June(full-time employees + temporary employees)

Shares information (as of March 31, 2023)
Total number of shares authorized to be issued 123,900,000 shares
Total number of issued shares(including treasury shares)

43,541,438 shares

Number of shares per unit

100 shares

Number of shareholders

8,892

Shareholder nameDistribution of shares by type of holder
Treasury shares

Financial institutions

Individual/other

Financial instruments
business operators

15.10%

26.58%

16.19%

Major shareholders

Initiatives endorsed or signed

Number of employees

Number of shares held Shareholding ratio(shares)
(%)

1.58%

Foreigncorporations, etc.

30.57%The Master Trust Bank of Japan, Ltd.
(Trust account)

5,139,500

13.88

Custody Bank of Japan, Ltd. (Trust account)

2,891,100

7.81

JPMorgan Chase Bank 385632

2,771,167

7.48

Change in share price

Otsuka Pharmaceutical Co., Ltd.

2,000,000

5.40

(yen)

NORTHERN TRUST CO. (AVFC) RE THE
HIGHCLERE INTERNATIONAL INVESTORSSMALLER COMPANIES FUND

1,303,200

3.52

The Dai-ichi Life Insurance Company, Limited

1,100,000

2.97

GOVERNMENT OF NORWAY

840,800

2.27

Nippon Life Insurance Company

799,200

2.16

VICTORY TRIVALENT INTERNATIONALSMALL-CAP FUND

627,700

1.70

1,000STATE STREET BANK AND TRUSTCOMPANY 505001

625,928

1.69500

3,000*The Company owns 6,512,625 treasury shares, but these are not included in theabove list of the ten largest major shareholders.

Other domestic
orporations

Eiken Chemical

9.98%

TOPIX

2,500
2,000
1,500

0

FY3/13 FY3/14 FY3/15 FY3/16 FY3/17 FY3/18 FY3/19 FY3/20 FY3/21 FY3/22 FY3/23

EIKEN CHEMICAL Integrated Report 202362