Supplementary Materials for
Consolidated Business Performance forthe First Three Quarters of FYE2018

February 5, 2018TAIYO NIPPON SANSO Corporation
11Contents
１. Business Performance for First Three Quarters of FYE2018

1) Overview of business performance2) Business performance by segment
２. Full-Year Forecasts for FYE2018

1) Overview of forecasts for the full-year2) Forecasts by segment
３. Reference Materials

1）Statement of non-recurring profit and loss2）Key performance indicators
3）Sales mix by industry
4）TNSC’s Gas Supply Structure21-1. Overview of business performance(Billions of yen)

FYE2017
Q3 Results
MarginRevenue

415.8

FYE2018
Q3 Results

YoY Change

Margin

471.4

+55.6
+13.4%

Core operating income

40.8

45.7
9.8%

+4.9
9.7%

+11.8%

Non-recurring profit and loss

0.1

0.5

+0.4

Operating income

41.0

46.2

+5.2

9.9%

9.8%

+12.6%

Finance costs-2.0-2.6-0.6

Income before income taxes

39.0

43.6

+4.6

11.7

2.4-9.3

27.2

41.2

+14.0

Net income attributable to owners of theparent

26.0

39.9

+13.9

Net income attributable to non-controlling interests

1.2

Income tax expenses
Net income(Attribution of net income)

6.3%

8.5%

1.2+53.6%+0

Impact of foreign currency translations (US$→¥): FYE2017 Q3 rate: $1=¥107.34 FYE2018 Q3 rate: $1=¥111.77→Impact of currency gains led to increases of ¥7.9 billion in revenue and ¥0.7 billion in core operating income
The reversal of deferred tax liabilities at a subsidiary based in the U.S., accompanying a reduction of the federal corporate income
tax rate in U.S. tax reform legislation, resulted in a significant decrease in income taxes shown in the consolidated statements ofprofit or loss. (Income taxes decreased ¥11.7 billion in FYE2018 Q3)

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1-1. Overview of business performance【Revenue】
FYE2017
Q3 Results

FYE2018
Q3 Results% Change

Gas Business in Japan

230.9

246.3+6.7%

Gas Business in the U.S.

105.7

128.5+21.6%

Gas Business in Asia and Oceania

58.7

74.8+27.5%

Thermos and Other businesses

20.4

21.6+5.9%

Revenue Total

415.8

471.4+13.4%

FYE2017
Q3 Results

FYE2018
Q3 Results% Change

Gas Business in Japan

22.1

23.0+4.1%

Gas Business in the U.S.

8.1

10.0+23.2%

Gas Business in Asia and Oceania

4.2

7.2+72.9%

Thermos and Other businesses

7.9

6.9-12.2%

Eliminations or Corporate-1.4-1.5－Core operating income Total

40.8

45.7+11.8%

Non-recurring profit and loss

0.1

0.5+193.7%

Operating income Total

41.0

46.2+12.6%(Billions of yen)

【Operating income】(Billions of yen)4

1-2. Business Performance by Segment: Gas Business in Japan(Billions of yen)

Industrial Gas

RevenueElectronics

EnergyFYE2018Q3

Q3% Change

Bulk gases

57.7

61.1+5.8%

On-site gases

34.8

40.4+16.1%

Packaged gases

8.7

8.5-2.2%

Hard goods

17.0

17.3+1.7%

Plants and Equipments

27.8

27.1-2.5%

Medical16.4

16.1-1.3%

Total

162.6

170.8

+5.0%

Gases

34.8

36.7+5.3%

Equipment and Installation

15.3

16.8

+10.0%

Total

50.1

53.5

+6.7%

LP gas

15.9

19.8+24.0%

Related Equipment

2.1

2.1+1.9%

Total

18.1

21.9

+21.4%

Revenue Total

230.9

246.3

+6.7%

22.1

23.0

+4.1%

Segment income

Reasons for changes in revenue
・JFE SANSO CENTER Kurashiki Factory started
operation・Revisions to carbon dioxide gas prices(recognized mainly in bulk gases)
・Electronics-related: Electronic materials gases
trended favorably
・LP gas: Higher sales price following anincrease in the import price
5FYE2017

Reason for change in segment income
・Higher costs in line with rising crude oil prices
・Electronics-related: Electronic materials gases
trended favorably1-2. Business Performance by Segment: Gas Business in the U.S.
FYE2017Q3(Billions of yen)

Industrial Gas

RevenueElectronics

FYE2018
Q3% Change

Bulk gases

38.6

52.1

+34.9%

On-site gases

3.26.6+102.7%

Packaged gases

34.8

37.1

+6.5%

Hard goods

21.2

24.1

+13.5%

Total

98.0

120.0

+22.4%

Gases

6.6

5.6

-15.2%

Equipment and Installation

1.0

2.8

+184.1%

Total

7.6

8.5

+11.2%

105.7

128.5

+21.6%

8.1

10.0+23.2%

Revenue Total
Segment income※Impact of yen appreciation on currency translations
Revenue increased by ¥4.4 billion and segment income by ¥0.4 billion

Reasons for changes in revenue
・Recognition of business acquired from Air
Liquide contributed ¥13.6 billion
・Bulk gases: Revenue rose due to increased
shipments of carbon dioxide gas
・Packaged gases: Higher revenue due torecovery trend in sales
6Reason for change in segment income
・Bulk gases: Higher revenue from carbon dioxide
gas contributed to increased segment income
・Higher revenue from packaged gases
contributed to increased segment income

1-2. Business Performance by Segment: Gas Business in Asia and Oceania
FYE2017
Q3(Billions of yen)

Industrial Gas

RevenueElectronics

FYE2018
Q3% Change

Bulk gases

17.3

26.6

+53.5%

On-site gases

1.8

2.1

+19.4%

Packaged gases

3.2

4.1

+26.7%

Hard goods

4.4

4.0-9.5%

Plants and Equipment

8.3

9.1+9.7%

Total

35.2

46.1

+30.9%

Gases

19.6

23.7+20.8%

Equipment and Installation

3.7

4.9+31.3%

Total

23.4

28.6+22.5%

Revenue Total

58.7

74.8+27.5%

4.2

7.2+72.9%

Segment income※Impact of yen appreciation on currency translations
Revenue increased by ¥3.4 billion and segment income by ¥0.3 billion

Reasons for changes in revenue◆Industrial gas-related business・Contribution from the acquisition ofSupagas Holdings Pty Ltd (Australia):¥8.0 billion
・Singapore and Malaysia: Soft sales of hard
goods to the oil & gas sector◆Electronics-related business・China, South Korea, Taiwan: Favorable salesof electronic materials gases
7

Reason for change in segment income◆Industrial gas-related business・Contribution from the acquisition ofSupagas Holdings Pty Ltd (Australia):¥1.5 billion
・Singapore and Malaysia: Segment income
decreased in line with lower revenue◆Electronics-related business・China, South Korea, Taiwan: Favorable salesof electronic materials gases

1-2. Business Performance by Segment: Thermos and Other businesses

FYE2017
Q3(Billions of yen)

Thermos
Revenue

FYE2018
Q3% ChangeJapan

16.0

16.7+4.1%

Asia

2.6

2.9+10.5%

Total

18.7

19.6+5.0%

Other

1.7

2.0+15.6%

Revenue Total

20.4

21.6+5.9%

7.9

6.9

-12.2%

Segment income※Impact of yen appreciation on currency translations
Revenue increased by ¥0.1 billion and segment income by ¥0.0 billion

Reasons for changes in revenue◆Thermos Business・Japan: Solid sales centered on vacuum
insulated portable mugs and tumblers

8Reason for change in segment income◆Thermos Business・Japan: Decrease due to increased expenses
・Overseas: Soft business performance byGroup companies accounted for by theequity method

2-1. Full-Year Forecasts for FYE2018(Billions of yen)

FYE2017
ResultsFYE2018
Forecast(Announced Jan. 30)

MarginMargin

Revenue

581.5

635.0

YoY Change% Change+53.5

FYE2018
Forecast(Announced Nov. 1)
Margin

620.0

+9.2%

Core operating income

54.7

60.0
9.4%

Non-recurring profit and loss

Operating income

+5.3
9.4%

56.5

+9.6%

9.1%

-1.00+1.00.5

53.6

60.0

+6.4

57.0

9.2%

9.4%

+11.8%

9.2%

Finance costs

-3.4

-4.0

-0.6-4.5

Income before income taxes

50.1

56.0

+5.9

52.5

13.9

6.0-7.9

16.0

36.2

50.0

+13.8

36.5

Net income attributable to owners ofthe parent

34.7

48.0

+13.3

34.5

Net income for the year attributable to noncontrolling interests

1.4

Income tax expenses
Net income(Attribution of net income)

96.0%

7.6%

2.0

5.6%

+0.6

The reversal of deferred tax liabilities at a subsidiary based in the U.S., accompanying a reduction of thefederal corporate income tax rate in U.S. tax reform legislation, resulted in a significant decrease in incometaxes shown in the consolidated statements of profit or loss. (Income taxes decreased ¥11.7 billion inFYE2018 Q3)

2.0

2-2. Full-Year Forecasts for FYE2018 by Segment【Revenue】(Billions of yen)

FYE2017
Results

FYE2018
Forecast

FYE2018% Change(Announced Feb.5)

Forecast(Announced Nov. 1)

Gas Business in Japan

321.4

341.0

+6.1%

338.0

Gas Business in U.S.

147.2

169.0

+14.8%

164.0

Gas Business in Asia and Oceania

85.8

98.0

+14.1%

91.0

Thermos and Other businesses

27.0

27.0-0.1%

27.0

Revenue Total

581.5

635.0+9.2%

620.0【Operating income】(Billions of yen)

10FYE2017
ResultsFYE2018
Forecast

FYE2018% Change(Announced Feb. 5)

Forecast(Announced Nov. 1)

Gas Business in Japan

29.4

30.0+1.9%

28.7

Gas Business in U.S.

12.0

13.5

+11.8%

13.5

Gas Business in Asia and Oceania

5.1

9.5+83.9%

7.8

Thermos and Other businesses

10.0

9.0-10.2%

9.0

Eliminations or Corporate-1.9-2.0－-2.5

Core operating income Total

54.7

60.0+9.6%

56.5Non-recurring profit and loss

-1.00－0.5

Operating income Total

53.660.0+11.8%

57.0

(Reference Materials)

11Non-recurring Income and Expense Items
FYE2017 Q3results

FYE2018 Q3results

YoY changeCore operating income

40.8

45.7

+4.9

Non-recurring profit and loss

0.10.5+0.4

Operating income

41.0

46.2+5.2(Billions of yen)【Non-recurring Income and Expense Items】
FY2017 Q3 results
Item
Gain on sales of Asian land

FYE2018 Q3 Results
Am ountItem\0.1 billion Gain on sales of domestic land
Share of loss of associates and joint
ventures accounted for using theequity method of THERMOS K. K.

Total

12\0.1 billion Total

Am ount\1.0 billion-\0.5 billion\0.5 billion

Key Performance Indicators (Consolidated)
FYE2018
Forecast

FYE2017
Q3 Results

FYE2018
Q3 Results

FYE2017
Results

Basic earnings per share (Yen)

60.16

92.38

80.28

110.92

ROE

－－

10.3%

12.8%

ROCE－－

8.4%

8.3%

Annual dividends per share (Yen)

－－

20

22

Dividend payout ratio

－－

24.9%

19.8%

Capital expenditures

29,13243,065

43,79666,000101,285

2,930102,034－

29,20532,25240,04844,000380,820

348,516

359,528

341,000(construction base)(Millions of yen)

Investments and loans(Millions of yen)

Depreciation and amortization(Millions of yen)

Balance of interest-bearing liabilities(Millions of yen)

(Announced Feb.5)

Excluding the effects of the significant decrease in income taxes resulting from the reduction of the federal corporate income
tax rate accompanying U.S. tax reform legislation, we expect basic earnings per share of ¥83.19, ROE of 9.7%, ROCE of8.3%, and dividend payout ratio of 26.4%.

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Sales Mix by Industry【Sales Volume Mix by Industry】
1%
Steel and other metals

57%

Oxygen18%

32%

Nitrogen

24%

38%

Argon

0%

10%

20%

30%

3%

22%

3%

16%

40%

50%

5%

20%

60%

21%

ChemicalsElectronic equipment &semiconductors
Shipbuilding, machinery,transportation equipment
Others

17%

23%

70%

80%

90%

100%

【Net Sales Mix by Industry】
Steel and other metals

Separate
Gases(O2, N2, Ar)

21%

8%

Total Sales

0%

14

23%

10%

10%

18%

24%

20%

30%

11%

8%

40%

Chemicals

27%

Electronic equipment &semiconductors
Shipbuilding, machinery,transportation equipment
Others50%50%60%70%80%90%100%

TNSC’s Gas Supply Structure
Separate gases
Supplied via pipeline(on-site)
OxygenNitrogen

CEArgonEvaporator

Tanker trucks(bulk gases)
OxygenArgon

NitrogenAir separation unit (ASU)
OxygenNitrogen

Argon

Filling station

Supply via cylinders(packaged gases)

Packaged gases

Other gases
OxygenNitrogen

Argon

Supply via tanker trucks, cylinders(bulk and packaged gases)
Chemicalplant offgas

Import fromoverseas incontainers, etc.

Carbondioxide gas

HydrogenHeliumLPG

Specialtygases

Acetylene

15

Packaged gases
Dewar
vessel(liquid)

Customers

Carbondioxide gas

HydrogenHeliumLPG

Specialtygases

Acetylene

・Steel andnonferrous metals
・Electronics
・Petroleum andchemicals
・Automobiles andindustrial
machinery・Glass and paper・Medical care・Food・Other

Disclaimer●These materials are not intended for purposes of disclosure for securities
transactions, and it is impossible to guarantee that the information
contained in this presentation is accurate and complete.

●This presentation and report contain forward-looking statements (estimatesand forecasts) regarding the future plans, strategies, activities andperformance of Taiyo Nippon Sanso Corporation. Forward-looking
statements reflect management’s assumptions and beliefs based on
information available as of the time of writing. Actual results reflect avariety of risk and uncertainties. These risks and uncertainties include, but
are not limited to, changes in general economic and specific marketconditions, currency exchange rate fluctuations, tax systems, andregulations.
●Accordingly, actual results may differ from forecasts issued at this time.
With this in mind, please refrain from relying solely on these materials when
making investment decisions.

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