The way of mutual progress

ANNUAL REVIEW 2020
For the Year Ended March 31, 2020

PRESIDENT’S MESSAGE

Yushiro Chemical Industry Co., Ltd. has contributed to theprogress and material development of Japan by supplying quality
oil-fat-wax (yu-shi-ro) products. We have succeeded in developing
and offering to virtually all industrial markets such auxiliary
products as metalworking oils and fluids, polishing agents forbuilding maintenance. To respond to the needs of the industry,
every technology we have acquired will be fed back to our R&D
process for the creation of newer technologies and products basedon our corporate ideal of “the way of mutual progress.”

Eiichi Ogo
PRESIDENT

Business summary
During this consolidated financial year, the global economy started to slow
down as the impact from the novel coronavirus (COVID-19) spread from
China to North America, Europe and Asia amid an increasingly uncertain
outlook due to an economic slowdown in China caused by trade friction
between the United States and China as well as the impact from Britain’s
withdrawal from the EU. Japan’s economy was further dampened by the
impact from the trade friction between the United States and China as well
as COVID-19, despite expectations of a recovery from the effects of theconsumption tax hike and typhoons, etc. from the beginning of 2020.
Under these circumstances, net sales increased 6.0% from the previous fiscal
year to ¥37,274 million, partly due to the effect of the U.S. company
QualiChem, Inc. that joined the Group in August 2018. Operating income
increased 6.6% from the previous fiscal year to ¥2,213 million, ordinary
income increased 3.2% from the previous fiscal year to ¥2,718 million, andnet income attributable to owners of parent increased 10.9% from theprevious fiscal year to ¥1,913 million.
The economic outlook going forward is expected to remain severe due to
COVID-19, and there are concerns over risks that the spread of the virus
could put further downward pressure on the global economy.
Under these circumstances, it is difficult to reasonably calculate forecasts ofbusiness results at this time. Therefore, the forecast of consolidated businessresults remains pending. Going forward, the forecast of consolidated businessresults will be promptly disclosed once such disclosure becomes possible.

1

Business segment(

Previous Fiscal Year
April 1, 2018 throughMarch 31, 2019

) (Current Fiscal Year
April 1, 2019 throughMarch 31, 2020

Increase/) Decrease

Million yen%

Million yen

%

%

Japan

17,96551.1

17,07845.8

95.1

North and South America

7,537

21.4

11,280

30.3

149.7

China

4,880

13.9

4,340

11.6

88.9

Southeast Asia / India

4,787

13.6

4,575

12.3

95.6

Total

35,170100.037,274

100.0

106.0

M e d i u m a n d L o n g - Te r m P l a n
The Yushiro Group has formulated a Medium-term Plan covering the three
years from the fiscal year ending March 31, 2018 to the fiscal year ending
March 31, 2020 with the objective of becoming a company that continues toexist beyond its 100th year of founding.
1. Business Environment and the Group’s Response
The domestic market for the automobile industry to which our main
customers belong, remains peaked out due to the aging population,
young people turning away from automobiles, and the continuing
offshore relocation of production site to overseas. Meanwhile, theoverseas market is in an expansionary trend, and the Group has worked
to strengthen and expand its business through initiatives such as startingup plants in India and Mexico in the fiscal year ended March 31, 2015,
which was the first year of our 17th Medium-term Plan, as well as
adding Japan Cee-Bee Chemical Co., Ltd. to its group companies in
2015, the second year of the Plan.
Under the 18th Medium-term Plan, we will continue to actively invest
management resources in regions with expanding markets and strive toreinforce the overall strengths of the Group by strengthening our global
sales and technological capabilities and making strategic investments inorder to achieve sustainable growth.

2. Basic Policy
1) Strengthen our global sales capabilities
We will strengthen our sales capabilities by reinforcing personnel inorder to respond to expanding overseas markets and by building sales
networks at domestic and overseas bases in order to accelerate businessexpansion.
2) Strengthen competitiveness in our core businessWe will further strengthen our technological proposal capabilities in themetal processing sector and work to increase both customer satisfaction
and added value in order to expand profitable business. Additionally, we
will reinforce our business through strategic investment.
3) Establish a structure that maximizes synergy among Group companies
We will create a structure that maximizes synergy among Group
companies by utilizing the information held by the Group to improve
management efficiency and accelerate management decision-making.
3. Basic Strategies
1) Overseas business strategy• Reinforce sales capabilities by increasing sales staff and upgrading
our dealership and agency networks• Improve business efficiency by actively utilizing information among
companies, including domestic companies• Expand sales bases mainly in the United States, China and Southeast
Asia2) Domestic business strategy• Reinforce sales channels• Expand sales in the plasticity fluids and casting fluids business• Establish global production lines aimed at strengthening costcompetitiveness• Promote collaboration with manufacturers of tools and machinery,
and joint research with universities
3) Strategic investment• Undertake business reinforcement and expansion through alliancesand M&As mainly in Japan and North America
4) New business strategy• Commercialize self-healing polymer
With regard to the new Medium-term Plan covering the three years fromfiscal 2020 to fiscal 2023, there are many uncertainties currently affecting theGroup’s business results due to the spread of COVID-19, making it difficult
to make reasonable calculations. The new Medium-term Plan will therefore
be announced upon careful examination of the future economic situation.

Basic policy for profit distribution
The Company’s basic policy for profit distribution is to provide shareholder
returns in consideration of our global business expansion and consolidated
business results. Shareholder returns are determined upon consideration of
the capital investments that are required to improve corporate value.

Yen in millions

Net sales

U.S. dollars in thousands

2020

Fiscal Years ended March 31,¥

37,274¥

2,213

Operating income

2019

2020

35,170$ 342,499

2,076

20,343

Net income

1,913

1,724

17,579Total assets

47,32048,958434,815

Net assets

31,86731,791

292,822

Per Share Amounts
Net income per share
Cash dividends per share
Net assets per share

Yen¥

140.91

U.S. dollars¥

127.03

$

1.29

48.00

45.00

0.44

2,194.75

2,199.96

20.16

Notes : 1. U.S. dollar amounts, converted at the rate of ¥108.83 to US$1.00, are for convenience only.
2. Net income per share is based on the average number of shares outstanding at the end of each fiscal year.
3. Japanese yen amounts of less than one million have been excluded.

2

REVIEW OF OPERATIONSThe Yushiro Group consists of Yushiro Chemical Industry Co.,
Ltd., three domestic subsidiaries, fourteen overseas subsidiaries
and three affiliates, and its major businesses are the production
and sales of metalworking oils and fluids, chemicals for building
maintenance. We are going to expand our business in growing
areas globally as well as a domestic market continuously.

Review of Operations by Region
Japan
Domestic automobile production volume remains in an extremely severe situation, andexports of automotive parts to the United States and China are also decreasing. As a result,segment net sales fell 4.9% from the previous fiscal year to ¥17,078 million. Segment
income decreased 8.7% from the previous fiscal year to ¥759 million.
North and South America
Net sales at the existing subsidiaries in the United States fell below the previous fiscal year
due to impacts from reduced production by Japanese automobile manufacturers. In
addition, despite increased sales at the subsidiary in Brazil on a local currency basis as theresult of product price revisions and steady domestic automobile production volume, net
sales decreased on a yen basis due to the effect of exchange rates. However, although thevolume of automobile production at the subsidiary in Mexico decreased, segment net sales
increased significantly, rising 49.7% over the previous fiscal year to ¥11,280 million due toan increase in sales thanks to an expanded market share among existing customers and thebusiness results of QualiChem, Inc., which became part of the Group in August 2018.
Segment income also increased 148.8% over the previous fiscal year to ¥985 million due tothe profit contribution by QualiChem, Inc. and the profit posted by the subsidiary inBrazil following the loss recorded in the previous fiscal year.
China
The volume of automobile production decreased due to the trade friction between the
United States and China, as a result of which segment net sales decreased 11.1% from theprevious fiscal year to ¥4,340 million.
Segment income fell 34.9% from the previous fiscal year to ¥287 million due to an upsurge
in prices of raw materials and continued increases in expenses for personnel.
Southeast Asia/India
Sales at subsidiaries in Thailand and Malaysia decreased, partly due to the reduction in
automobile production volume caused by the trade friction between the United States andChina, and the slump in exports of automotive parts. In addition, sales at the subsidiary inIndia decreased due to the impact from COVID-19. However, sales at the subsidiary inIndonesia increased as the result of an expanded market share among existing customers,
despite a reduction in domestic automobile production volume. As a result, segment net
sales fell 4.4% from the previous fiscal year to ¥4,575 million.
Segment income increased 10.9% over the previous fiscal year to ¥593 million partly due tocost reductions at the subsidiary in Thailand, despite the impact from lower sales.

Subsidiaries and Associated Companies
Domestic Subsidiaries
Yushiro Unso Co., Ltd.
1157-2 aza-Yubunepara, Yubune, Oyama-cho,Sunto-gun, Shizuoka JAPAN
Phone: (0550)86-1112 Fax: (0550)76-1034
Yushiro General Service Company
1157-2 aza-Yubunepara, Yubune, Oyama-cho,Sunto-gun, Shizuoka JAPAN
Phone: (0550)86-1113 Fax: (0550)76-1034
The Japan Cee-Bee Chemical Co., Ltd.
Omori Plaza Bldg.4F, 3-28-3 Minamioi, Shinagawa-ku, Tokyo JAPAN
Phone: (03)5767-6431 Fax: (03)5767-6437
URL: http://www.jcbchem.co.jp/

Overseas Subsidiaries
Yushiro Manufacturing America Inc.
783 West Mausoleum Road, P.O. Box 217
Shelbyville, Indiana 46176-9720 U.S.A.
Phone: (1) 317-398-9862 Fax: (1) 317-392-4818
URL: http://www.yushirousa.com/
3

QualiChem, Inc.
2003 Salem Industrial Dr, Salem, VA 24153, USA
Phone: (1) 540-375-6700 Fax: (1) 540-375-3880
URL: https://www.qualichem.com/
Yushiro do Brasil Indústria Química Ltda.
Av. Henry Néstle, 3100 Caçapava, CEP. 12286-140,
São Paulo, Brazil
Phone: (55) 12-3654-8100 Fax: (55) 12-3654-8101
URL: http://www.yushiro.com.br/
Yushiro Mexico S.A. de C.V.
Av. Mina de Guadalupe 478 Parque Industrial Santa Fe Ⅳ
Guanajuato Puetro Interior, CP 36275
Silao, Guanajuato, Mexico
Phone: (52)472-748-9208
URL: http://yumex.mx/
Shanghai Yushiro Chemical Industry Co., Ltd.
881 Fulian Road, Guncun Industrial Park,
Baoshan District, Shanghai, China
Phone: (86)21-3604-1188 Fax: (86)21-3604-0916
URL: http://www.yushiro.com.cn/
Qidong Yushiro Chemical Industry Co., Ltd.
The North of New Qidong Port,
Qidong City, Jiangsu Province, China
Phone: (86)513-8369-9942 Fax: (86)513-8369-9943
URL: http://www.yushiro.com.cn/
Taixing Cee-Bee Chemical Co., Ltd.
No.8, Bin Jiang S.Road, Taixing Economic Development
Zone, Taixing of Jiangsu Province, China
Phone: (86)0523-87607898 Fax: (86)0523-87607897
Yushiro Malaysia Sdn. Bhd.
7, Jalan TPP 3, Taman Perindustrian Putra, 47130 Puchong,Selangor Darul Ehsan, Malaysia
Phone: (60) 3-8069-9390 Fax: (60) 3-8051-3946
URL: http://www.yushiro.com.my/
Yushiro (Thailand) Co., Ltd.
700/533 Moo7, Amata Nakorn Industrial Estate, T. Don HuaRoh, A. Muang Chonburi, Chonburi 20000, Thailand
Phone: (66)3845-4873 Fax: (66)3845-4879
Siam Cee-Bee Chemical Co., Ltd.
700/936, Moo 5, Amatanakorn Industrial Estate,
T.Nongkhaka, A.Phanthong, Chonburi 20160 THAILAND
Phone: (66)038-210-772 Fax: (66)038-210-776
Yushiro India Company Private Limited
608. J. M. D. Pacific Square Sector-15, Part-Ⅱ,
Gurgaon 122002, Haryana, India
Phone: (91)124-424-1650 Fax: (91)124-424-1652
PT. Yushiro Indonesia
JI. Maligi 1, Blok B-2B, Kawasan Industri KIIC,
Karawang 41361-Java Barat, Indonesia
Phone: (62)21-8911-4271 Fax: (62)26-7845-7934
URL: http://www.yushiro.co.id/
Overseas Associated Companies
Buhmwoo Chemical Ind. Co., Ltd. & Buhmwoo Co., Ltd.
70-3, Yangjae-Dong, Seocho-gu, Seoul, Korea
Phone: (82) 2-571-6321 Fax: (82) 2-571-6329
URL: http://www.buhmwoo.com/
San-I Chemical Co., Ltd.
7th Fl. No.48 Ming Chuang W. Rd., Taipei, Taiwan R.O.C.
Phone: (886)2-2522-1313 Fax: (886)2-2522-1363
URL: http://www.san-i.com.tw/Business on metalworking oils and fluids
What is "metalworking oils and fluids"• Fluids used for processing steel and other metals into specific shapes.
• Important areas of fluid performance include lubricity, cooling ability, etc.
• Mainly used in the automotive, precision processing and semiconductor
processing industries.
Products• Cutting and Grinding Oils and Fluids• Aluminum Diecasting Lubricants• Cutting Oils and Fluids for Advanced-Material• Cleaners• Rust Preventives• Rolling Oils and Fluids• Drawing Oils and Fluids• Forming Oils and Fluids• Quenching Agents• Fire Resistant Hydraulic Lubricants• Other Oils and Fluids
Customers• Automobile companies• Precision machine processing companies• Steel companies• Electric equipment companies• Other machine processing companies

4

5 6

3

2

Automobile
68.1%

1

1. Automobile manufacturer andAutomobile related: 68.1%
2. Precision machinery: 14.3%
3. Ball bearing manufacturer: 6.2%
4. Steel industry: 3.8%
5. Photo Voltaic/semiconductor: 1.2%
6. Other: 6.4%
Shares of sales by customers for the fiscal year
ended March 2020. (non-consolidated)

The Company’s advantages in the field of Cutting
and Grinding Oils and Fluids• Our overwhelming share in the automobile industry; morethan 60%
The Company features its production development capacities
and quick response to changes in the automobile industry
including rationalization, changes in materials and measures
to address environmental issues.
• Our wide human network interacts with users in different
industries at “The Society of Cutting Fluids & Cutting
Technology”
About the Society of Cutting Fluids & Cutting Technology
The society was launched in 1954 as an on-site research group made up of
metal processing technology researchers, and has served as an officebridging academy and industry for more than 60 years.
Engineers with abundant on-site experience, beginning with those from
our automotive manufacturing customers, as well as those from machine
manufactures, tooling manufactures, etc., gather to exchange information
and work together to develop higher technologies and further nurture
their expertise. This group has served as a “training room” for theseexperts throughout the history of the industry. It is therefore no
exaggeration to say that this group is a national asset supporting productdevelopment, or monozukuri.

Note: Metalworking oils and fluids business: Metalworking oils and fluids are
manufactured and sold by Yushiro Chemical Industry Co., Ltd.
In overseas markets, metalworking oils and fluids are manufactured and sold by
the Company’s subsidiaries;
Yushiro Manufacturing America Inc., QualiChem, Inc. in the United States;
Yushiro do Brasil Ind. Quimica Ltda., in Brazil;
Yushiro Mexico S.A. de C.V. in Mexico;
Shanghai Yushiro Chemical Industry Co., Ltd., Qidong Yushiro Chemical
Industry Co., Ltd., and Guangzhou Yushiro Oil & Fluids Co., Ltd., in China;
Yushiro Malaysia Sdn. Bhd., in Malaysia;
Yushiro (Thailand) Co., Ltd., in Thailand;
Yushiro India Company Private Limited, in India;
P.T.Yushiro Indonesia in Indonesia;
and our affiliates;
Buhmwoo Chemical Industry Co., Ltd., and Buhmwoo Co., Ltd., in South Korea;
San-I Chemical Co., Ltd., in Taiwan.

4

CONSOLIDATED BALANCE SHEETS(Unaudited)
As of March 31, 2020 and 2019

U.S. dollars
in thousands(Note 5)

Millions of yen

AssetsCurrent assets:
Cash and time deposits
Notes and accounts receivable–trade
Inventories
Other current assets
Allowance for doubtful accounts
Total current assets
Fixed assets:
Buildings and structures
Machinery, equipment and vehicle
Tools, furnitures and fixtures
Land
Lease assets
Construction in progress(Total property, plant and equipment)
Goodwill
Customer relationshipTechnical assets
Trademark right
Other intangible fixed assets(Total intangible fixed assets)
Investment in securities
Investments in subsidiaries and affiliates
Savings premiumLong-term time deposits
Deferred tax assets
Other assets
Allowance for doubtful accounts(Total investments and other assets)
Total fixed assets
Total assets

5

2020

¥

7,160
6,636
4,333
486
(13)
18,603

2019

¥

7,145
7,196
4,540
420
(23)
19,2792020$

65,79460,97839,8204,469(122)
170,939

4,760
1,489
482
5,162
89
101
12,086

4,856
1,363
396
5,150
50
51
11,86943,742
13,6894,429
47,437825
933
111,058

2,167
1,962
647
568
608
5,954

2,421
2,094
704
617
565
6,403

19,912
18,030
5,952
5,225
5,592
54,713

3,141
6,426
656
1
151
314
(15)
10,67628,717¥ 47,320

4,310
6,409
472
2
12
220
(22)
11,406
29,678¥ 48,958

28,86759,048
6,035
17
1,390
2,888
(145)
98,103
263,875$ 434,815

U.S. dollars
in thousands(Note 5)

Millions of yen

Liabilities and net assets

2020

2019

2020

Current liabilities:
Notes and accounts payable–trade

¥

3,705

¥

4,351

$

34,051

Short–term borrowings

2,344

2,343

21,543

Accounts payable-other

888

839

8,167

Accrued corporate taxes

251

197

2,306

Accrued bonuses

396

396

3,647

Other current liabilities

1,306

1,390

12,005

Total current liabilities

8,893

9,519

81,721Long-term debt

3,646

4,422

33,509Net defined benefit liability

1,221

1,180

11,221

147

124

1,354

1,166

1,487

10,715

377

431

3,469

Long-term liabilities:

Accrued retirement allowances for directors
Deferred tax liabilities
Other long-term liabilities
Total long-term liabilities

6,559

7,646

60,271

15,453

17,166

141,993

Common stock

4,249

4,249

39,046

Capital surplus

4,014

4,014

36,885Retained earnings

24,577

23,275

225,837

(427)

(426)

(3,923)

Total liabilities
Net assets:

Treasury stock
Shareholders' equity

32,414

31,112297,845

Net unrealized gains on securities

731

1,661

6,723

Currency translation adjustments(3,261)(2,880)(29,964)

Remeasurements of defined benefit plans

(86)

(23)

(794)

Accumulated other comprehensive income(2,615)(1,242)(24,035)(Total minority interests)

2,069

1,922

19,01331,86731,791

292,822¥ 47,320¥ 48,958$ 434,815

Total net assets
Total liabilities and net assets

6

CONSOLIDATED STATEMENTS OF INCOME(Unaudited)
For the Years Ended March 31, 2020 and 2019

U.S. dollars
in thousands(Note 5)

Millions of yen

2020

Net sales2019¥ 37,274

Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income

2020

25,504
11,7699,555
2,213¥ 35,170
24,576
10,5948,518
2,076$ 342,499
234,352
108,147
87,803
20,343

183
382
89
(47)
(104)
504
2,718

143
442
113
(47)
(93)
557
2,634

1,682
3,518
825
(435)
(959)
4,631
24,974

18
–
(2)
16
2,734

–
(18)
–
(18)
2,616

169
–
(22)
147
25,122

667
(62)
604
2,129
(215)

606
19
626
1,989
(264)

6,130
(572)
5,558
19,563(1,983)Non-operating income (expenses):
Interest and dividend income
Equity in earnings of associated companies
Other income
Interest expenses
Other expenses
Sub-total
Ordinary income
Extraordinary profit (losses)

Gain on sales of fixed assets
Loss on disaposal of fixed assets
Loss on valuation of investment securities
Sub-total
Income before income taxes
Income taxes
Current
Deferred
Total income taxes
Net income
Net income attributable to non-contorolling interests
Net income attributable to owners of parent

¥

1,913

¥

1,724

$

17,579CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited)
For the Years Ended March 31, 2020 and 2019

U.S. dollars
in thousands(Note 5)

Millions of yen

2020

Cash flows from operating activities:

¥

¥

2,121

2020

$

25,994

Cash flows from investing activities:(1,111)(6,510)(10,210)

Cash flows from financing activities:(1,508)3,500(13,859)

(6)

(245)

(60)

202

(1,135)

1,864

6,947

8,082

63,837

Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year

7

2019

2,829

¥

7,150

¥

6,947

$

65,701IMPORTANT POINTS FORMING THE BASIS OFCONSOLIDATED FINANCIAL STATEMENTS
1. Scope of Consolidation
The scope of consolidation includes 16 consolidated subsidiaries: Yushiro
Unso Co., Ltd., Yushiro General Service Co., Ltd., Japan Cee-Bee ChemicalCo., Ltd., Yushiro Manufacturing America Inc., QualiChem, Inc., Yushiro
do Brasil Indústria Química Ltda., Yushiro Mexico S.A. de C.V., Shanghai
Yushiro Chemical Industry Co., Ltd., Qidong Yushiro Chemical Industry
Co., Ltd., Guangzhou Yushiro Oil & Fluids Co., Ltd., Taixing Cee-Bee
Chemical Co., Ltd., Yushiro Malaysia Sdn. Bhd., Yushiro (Thailand) Co.,
Ltd., Siam Cee-Bee Chemical Co., Ltd., Yushiro India Company Private
Limited., and P.T. Yushiro Indonesia.
2. Application of the Equity Method
The three affiliates, Buhmwoo Chemical Industry Co., Ltd., Buhmwoo Co.,
Ltd., and San-I Chemical Co., Ltd. are included in the scope of application
for the equity method.
3. Fiscal Years of the Consolidated Subsidiaries
The fiscal year-end of the overseas subsidiaries, with the exception of Yushiro
India Company Private Limited, is December 31. In preparing theconsolidated financial statements, results as of that date are used, provided
that necessary adjustments are made regarding material transactions
conducted between January 1 and March 31, the consolidation closing date.
4. Significant Accounting Policies(1) Valuation standard and methods for securities
In other securities, quoted securities are stated at market value at the
fiscal year-end. Unrealized gains/losses are included in net assets, andthe cost of securities sold is computed using the moving averagemethod.
Unquoted securities are accounted for on a cost basis using the moving
average method.
(2) Valuation standard and methods for inventories
The cost method by the aggregate monthly average method is adopted(i.e. the book value reduction method based on declines in profitability.
However, the last purchase price method is used for fuel out of
supplies.)(3) Depreciation method used for major depreciable assets
1. Tangible fixed assets (excluding leased assets)
The Company and its consolidated domestic subsidiaries use thedeclining-balance method (however, the straight-line method isadopted for the laboratory wing at the Kanagawa Technical Center,on which construction was completed in 1997, for buildings
acquired on or after April 1, 1998 (with the exception of annexedfacilities), and for annexed facilities and structures acquired on orafter April 1, 2016). Overseas consolidated subsidiaries generally use
the straight-line method. The main terms of useful service life are 3
to 50 years for buildings and structures and 2 to 20 years for othertangible fixed assets.
2. Intangible fixed assets (excluding leased assets)
The amortization of intangible fixed assets is conducted by thestraight-line method. Computer software for internal use isamortized by the straight-line method over the estimated useful life
(5 years). Additionally, goodwill, customer relationship, technicalassets, and trademark right are evenly amortized over 13 years, 20
years, 15 years, and 10 to 15 years, respectively.
3. Leased assets
Assets leased under finance lease transactions without a transfer ofownership
The straight-line method in which the lease term is deemed as theuseful life, with a zero residual value, is used.
4. Long-term prepaid expenses
The straight-line method is adopted.
(4) Standards for conversion of foreign currency denominated assets andliabilities to Japanese yen
Debts and credits denominated in foreign currencies are converted toyen at the actual market exchange rate on the closing date. The effect of
exchange rate changes is recorded as gain or loss. Assets and liabilities ofoverseas subsidiaries, etc. are converted to yen at the actual market

exchange rate on the consolidated closing date. Profit and expenses areconverted to yen at the average market rate during the period, and theeffect of exchange rate changes is included under currency translation
adjustments and total minority interests in net assets.
(5) Reserves
1. Allowance for doubtful accounts
The allowance for doubtful accounts is provided for possible bad
debts at the amount estimated based on the past debt experience fornormal receivables, plus uncollectible amounts determined byreference to the collectability of individual doubtful receivables.
2. Accrued bonuses
The accrued bonuses are provided at an estimated amount in order torecognize expenses for bonuses paid to employees over thecorresponding period.
3. Reserve for directors’ bonuses
At some subsidiaries, the reserve for bonuses to directors is provided
at the amount estimated to be accrued for the consolidated balance
sheet date to prepare for such payments.
4. Accrued retirement allowances for directors
In order to prepare the reserve for retirement allowances for directors,
the Company and its subsidiaries Yushiro Unso., Ltd. and Yushiro
General Service Co., Ltd. recognized the retirement allowances for
directors at the estimated amount on the consolidated balance sheet
date based on the internal regulations.
(6) Accounting treatment for employees’ retirement benefits
Method of attributing expected retirement benefits to periods
In calculating retirement benefit obligations, the benefit formula
method is the method used for attributing expected retirement benefits
to periods up to the end of the consolidated fiscal year under review.
Treatment of actuarial difference and prior service cost
Prior service cost is posted as expenses on a straight-line basis over acertain period (10 years) within the remaining service years of
employees as of the time of occurrence.
For actuarial differences, the amount divided by a straight-line basis
over a certain period (10 years) within the remaining service years of
employees as of the time of accrual during each consolidated fiscal year
is posted as expenses from the consolidated fiscal year following the
fiscal year of occurrence.
Unrecognized actuarial difference and unrecognized prior service costare provided as remeasurements of defined benefit plans underaccumulated other comprehensive income in net assets after adjustingfor tax effects.
Adoption of simplified method for small-scale enterprises
Certain consolidated subsidiaries adopt a simplified method for
calculating retirement benefit liabilities and retirement benefits whereby
the Company’s retirement benefit obligation is equal to the amount of
retirement benefits payable assuming that all employees are voluntarily
retired at the end of the fiscal year.
(7) Scope of funds contained within the consolidated statements of cashflows
The funds (cash and cash equivalents) included in the consolidated
statements of cash flows consist of cash on hand, deposits that can bewithdrawn at any time, and short-term investments with maturities
within three months from the acquisition date that can be easilyliquidated and are exposed to only a minimal value fluctuation risk.
(8) Other significant matters for the preparation of consolidated financial
statements
Accounting treatment of consumption tax, etc.
Consumption tax, etc. is recorded on a tax exclusive basis.
5. The U.S. dollar amounts in the financial statements for the
fiscal year ended March 31, 2020, represent translation ofJapanese yen at the rate of ¥108.83=US$1.00.

8

FINANCIAL INDICATORS
Operating Income (yen in million)

Net Sales (yen in million)
2020
2019

35,1702018

29,605

2016

2,076

2019

31,565

2017

2,213

2020

37,274

2018

2,502

2017

2,437

2016

30,6802,169

Total Assets, Net Assets (yen in million) , and ROE(%)

Net Income (yen in million)
1,913

2020

2020
2019

1,724

2019

2,228

2018
2017

1,993

2016

7.7

2017

48,95831,791

5.7

2018

1,697

47,32031,867

6.4

43,68332,19740,37529,318

6.2

2016

7.4
Total assets

Net assets

38,98328,536ROE

CORPORATE DATA (as of March 31, 2020)
34-16, 2-chome, Chidori, Ota-ku, Tokyo 146-8510, Japan
Phone: (03) 3750-6761 Fax: (03) 3750-1146 URL: https://www.yushiro.co.jp¥4,249 million
305
July 24, 1944
Tokyo, Nagoya and Osaka
Hokkaido, Tohoku, Kitakanto, Hamamatsu, Fukuyama, Hiroshima and Kyushu

Head Office
Capital
Employees
Established
Branch Offices
Sales Offices

Directors and Auditors (as of June 24, 2020)
Eiichi Ogo
Masanori Arisaka
Shingo Kikuchi
Takuya Ishikawa
Seiji Takahashi
Masafumi Nakano

President
Managing Directors
Directors

Directors (Audit Committee Members)

Katsuko Iizuka
Miki Koshiba
Toshio Yamazaki

STOCK INFORMATION (as of March 31, 2020)
Number of shares issued
Trading unit
Total number of shareholders
Stock listing
Securities code
Transfer agent for common stock
Independent certified public accountants
Main underwriter

13,900,065
100
4,126
First section, Tokyo Stock Exchange
5013
Mitsubishi UFJ Trust and Banking Corporation
Ernst & Young ShinNihon LLC
Nomura Securities Co., Ltd.

(millionsof yen )Market value of shares

25,00020,00015,00010,0005,000
02014/3 2015/3 2016/3 2017/3 2018/3 2019/3 2020/3

Stock pricesTerm2019/4

2019/5

2019/6

2019/7

2019/8

2019/9

High

1,348

1,350

1,394

1,377

1,348

1,395

1,450

1,479

Low

1,295

1,225

1,242

1,281

1,233

1,220

1,310

1,367

(Yen/share)(Yen/share)

2019/10 2019/11 2019/12

2020/1

2020/2

2020/3

1,507

1,467

1,436

1,310

1,345

1,318

1,205

958

Trading volume 159,500 252,700 202,700 194,800 183,300 242,900 340,300 392,600 439,900 188,600 195,300 483,800(Hundred of shares)