Consolidated Financial Results for the Year Ended March 31, 2018
(JPGAAP)May 11, 2018

Stock Exchange: Tokyo
Name of listed company: NISSAN CHEMICAL INDUSTRIES, LTD.
URL: http://www.nissanchem.co.jp/
Code Number: 4021
Representative: Kojiro Kinoshita, President
Inquiry to: Hironori Yoshida, Executive Officer and Director of Finance and Accounting Department Tel. +81 3 3296 8356
Scheduled dividend payment date : June 28, 2018
Scheduled date of annual shareholders' meeting: June 27, 2018
Scheduled date of submitting the Annual Securities Report : June 27, 2018
Supplemental information: Yes
Financial results meeting: Yes (for institutional investors and analysts)(Amounts rounded down to the nearest million yen)

1. Consolidated Financial Results for the Year Ended March 31, 2018 (From April 1, 2017 to March 31, 2018)(1) Consolidated Operating Results(% indicates the rate of increase/decrease year on year)

OperatingincomeNet salesYear ended March 31, 2018Year ended March 31, 2017
(Note) Comprehensive income:Ordinary
incomeNet income attributable toowners of parent

Million yen%

Million yen%

Million yen%

Million yen%

193,389

7.3

34,988

11.3

36,235

14.3

27,14213.0

180,289

1.9

31,4389.9

31,713

7.4

24,026

7.5

Year ended March 31, 2018

: 30,763 million yen, 29.4%

Year ended March 31, 2017

: 23,771 million yen, 10.5%

Basic earnings
per share
Yen

Year ended March 31, 2018Year ended March 31, 2017
(Reference) Equity in earnings of affiliates

Yen

180.30－156.97－

Ratio of ordinary
income tototal assets

Ratio ofnet income toshareholders' equity

Diluted net income
per share: Year ended March 31, 2018:

1,324 million yen: Year ended March 31, 2017:

701 million yen

Ratio of operating
income tonet sales

%

%

%

16.1

15.1

18.1

15.1

13.8

17.4

(2) Consolidated Financial Position
Total assets

As of March 31, 2018
As of March 31, 2017
(Reference) Shareholders' equity:

Net assets

Net assets
per share

Equity ratio

Million yen

Million yen%

Yen249,043

176,36470.1

1,168.07

231,748

163,70769.9

1,067.76

As of March 31, 2018 : 174,586 million yen
As of March 31, 2017 : 162,041 million yen(3) Consolidated Cash Flows
Cash flows fromoperating activities

Cash flows frominvesting activities

Cash and cash
equivalents at
end of period

Cash flows fromfinancing activities

Million yen

Million yen

Million yen

Million yen

Year ended March 31, 2018

37,691(15,244)(20,268)

37,702

Year ended March 31, 201732,491(13,152)(19,042)

35,701

Total
cash dividends(annual)Ratio of
Dividend
dividend
payoutto net assets
ratio(consolidated) (consolidated)

2. Cash Dividends
Cash dividends per shareFirst
quarter

SecondquarterYen

Thirdquarter

Yen

Year-end

Yen

AnnualYen

YenMillion yen%%

Year ended March 31, 2017

－

24.00

－

28.00

52.00

7,916

33.1

5.0

Year ended March 31, 2018

－

32.00

－

36.00

68.00

10,195

37.7

6.1

Year ending March 31, 2019
(Forecast)

－

38.00

－

40.00

78.00

40.6

3. Forecast of Consolidated Financial Results for the Fiscal Year Ending March 31, 2019 (From April 1, 2018 to March 31, 2019)(% indicates the rate of increase/decrease against the same period of the previous year)
OperatingincomeNet sales

Ordinary
incomeNet income attributable toowners of parent

Basic earnings
per share

Million yen%

Million yen%

Million yen%

Million yen%

Yen

Six months
ending March 31, 2019

96,700

6.3

18,4006.6

18,8005.4

14,1007.0

94.85

Year ending March 31, 2019

204,000

5.5

36,8005.2

38,0004.9

28,5005.0

191.93

The above basic earnings per share are calculated in consideration of share repurchase that will be implemented until July 31, 2018.

4. Notes(1) Changes in significant consolidated subsidiaries(Changes in specified subsidiaries involving changes in scope of consolidation): None(2) Changes of accounting policies and accounting estimates, and restatement
1. Changes of accounting policies due to revisions of accounting standards: None2. Changes of accounting policies other than the above: None3. Changes in accounting estimates: None4. Restatements: None(3) Number of shares outstanding (common shares)
1. Number of shares outstanding (including treasury shares)
As of March 31, 2018

: 151,000,000 shares

As of March 31, 2017

: 154,000,000 shares

2. Number of treasury shares
As of March 31, 2018

: 1,534,562 shares

As of March 31, 2017

: 2,242,017 shares

3. Average number of shares outstanding over the year
As of March 31, 2018

:150,542,352 shares

As of March 31, 2017

:153,058,176 shares* Presentation regarding implementation status of audit proceduresThis financial release is not subject to audit procedures based on Financial Instruments and Exchange Law in Japan.
Audit procedures of financial statements based on Financial Instruments and Exchange have not been completed at the time of disclosure.
* Explanations regarding appropriate use of business forecasts and other special notes
The business forecast contained in this report is based on information available at the time of disclosure.
Actual operating results may differ materially from the forecast due to various factors.
The prerequisite information of actual forecast and other items are on page 3.
For supplemental information, please refer to our website.

Table of Contents for Attached Materials

1. Analysis of Business Performances and Financial Position ........................................................................................................... 2(1) Analysis of Business Performance ........................................................................................................................................... 2(2) Analysis of Financial Position ................................................................................................................................................... 3(3) Basic Policy on Distribution of Earnings and Dividends for current and next term ................................................................... 4

2. Management Policy ....................................................................................................................................................................... 5(1) Basic Management Policy ........................................................................................................................................................ 5(2) Target Management Indicator .................................................................................................................................................. 5(3) Mid-and Long-term Management Strategies and Issues to be addressed ............................................................................... 5

3. Basic Approach to the Selection of Accounting Standards .............................................................................................................. 6

4. Consolidated Financial Statements ............................................................................................................................................... 7(1) Consolidated Balance Sheets .................................................................................................................................................. 7(2) Consolidated Statements of Income and Statements of Comprehensive Income .................................................................... 9(3) Consolidated Statements of Changes in Net Assets .............................................................................................................. 11(4) Consolidated Statements of Cash Flows ............................................................................................................................... 13(5) Notes to Consolidated Financial Statements ......................................................................................................................... 14(Going Concern Assumption) ........................................................................................................................................... 14(Segment and Related Information) .................................................................................................................................. 14(Per Share Information) .................................................................................................................................................... 17(Significant Subsequent Events) ....................................................................................................................................... 17

1

1. Analysis of Business Performance and Financial Position(1) Analysis of Business Performance
The domestic economy for the current consolidated fiscal year (April 1, 2017 to March 31, 2018) continued to recovermoderately as corporate earnings improvement, capital investment and consumer spending recovery amid the expansionof the global economy. Under such circumstance, in the Chemicals Segment, sales of Basic Chemicals increased andFine Chemicals decreased from the same period of the previous year. In the Performance Materials Segment, sales ofDisplay Materials, Semiconductor Materials and Inorganic Materials increased. In the Agricultural Chemicals Segment,
shipments of active ingredients for veterinary pharmaceuticals increased. In the Pharmaceutical Segment, the domestic
sales of "LIVALO" (anti-cholesterol drug) decreased due to expansion of generic products.
As a result, the Company's results for the current fiscal year were net sales 193,389 million yen (an increase of 131millionyen), operating income 34,988 million yen (an increase of 3,550 million yen) and ordinary income 36,235 million yen (anincrease of 4,521 million yen), and net income attributable to owners of parent 27,142 million yen (an increase of 3,116
million yen). Operating income and ordinary income recorded record highs for the fourth consecutive year and net income
attributable to owners of parent for the fifth consecutive year.
Explanations by segments are as below.
The Chemicals Segment
In the Basic Chemicals, sales of melamine (adhesive agent for particle board) decreased and sales of high purity sulfuric
acid (agent used for cleaning semiconductor) increased. In the Fine Chemicals, the sales of "TEPIC" (epoxy compound for
LED sealants) increased, while "HI-LITE" (chlorinated isocyanuric acid for sterilizing) decreased. In addition, the profit rate
of Chemical Segment decreased due to the price increase of raw fuel.
As a result, sales of this segment was 34,937 million yen (an increase of 156 million yen) and operating income was
3,410 million yen (a decrease of 410 million yen).
The Performance Materials Segment
In the Display Materials, "SUNEVER" (LCD alignment coating) for smartphone had healthy sales. In the Semiconductor
Materials, sales of bottom anti-reflective coatings for semiconductors (ARC®) and multi-layer process materials(OptiStack®) increased due to some customers' new plant operation and the recovery of capacity utilizations. In the
Inorganic Materials, "SNOWTEX" (semiconductor polishing, hard coating, etc.) and Oragno / Monomer sol (various kindsof coating materials, resin additive) had healthy sales. Sales of Oilfield materials (for enhancing oil recovery) increased.
As a result, sales of this segment was 58,762 million yen (an increase of 5,953 million yen) and operating income was
14,200 million yen (an increase of 1,666 million yen).
*ARC® and OptiStack® are registered trade mark of Brewer Science, Inc.
The Agricultural Chemicals Segment
Shipments of Fluralaner (active ingredients for veterinary pharmaceuticals) increased, and sales of “ALTAIR” (paddy riceherbicide) was also firm. We launched "ALIII", a new product that is more effective in weeding than conventional products,"ROUNDUP MAXLOAD AL" (herbicide for general household). This product contributed to higher sales. In addition,
agrochemicals for overseas were also well shipped.
As a result, sales of this segment was 58,138 million yen (an increase of 6,186 million yen) and operating income was
16,370 million yen (an increase of 3,169 million yen).
The Pharmaceuticals Segment
Overseas sales of "LIVALO" increased, while domestic sales declined due to an increase of generic products. Sales of"Custom Chemicals" (custom manufacturing and process researching services for pharmaceutical companies) was firm.
As a result, sales of this segment was 7,520 million yen (a decrease of 472 million yen) and operating income was 1,233
million yen (a decrease of 422 million yen).

2

Trading
Sales of this segment was 59,486 million yen (an increase of 4,287 million yen) and operating income was 1,826 million
yen (an increase of 128 million yen).
OthersSales of this segment was 21,461 million yen (a decrease of 2,568 million yen) and operating income was 612 million yen(a decrease of 353 million yen).
(Forecast of business result for the next term)(Billion yen)
Net Sales

Operating

Ordinary

Net Income attributable

Basic Earnings

IncomeIncometo Owners of Parent

per Share (Yen)

Next Term

204.0

36.8

38.0

28.5

191.93Current Term

193.4

35.0

36.2

27.1

180.30

Segment Sales and Operating Income(Billion yen)
Net Sales

Operating Income

Next Term

Current Term

Next Term

Current Term

Chemicals

38.0

34.9

3.9

3.4

Performance Materials

62.5

58.8

14.1

14.2

Agricultural Chemicals

63.0

58.1

17.7

16.4

Pharmaceuticals

7.2

7.5

1.5

1.2

Trading

64.7

59.5

2.0

1.8

Others

23.6

21.5

0.2

0.6

Adjustment(55.0)(46.9)

(2.6)

(2.6)

Total

204.0

193.4

36.8

35.0

As forecast of business result for the next term, we assume that net sales will be 204.0 billion yen, operating
income will be 36.8 billion yen, ordinary income will be 38.0 billion yen and net income attribute to owners ofparent will be 28.5 billion yen. The above forecast is calculated on the assumption that the exchange rate will be
107 yen per dollar.
(2) Analysis of Financial Position(Position of Assets, Liabilities and Net Assets)
Total assets as of March 31, 2018 was 249,043 million yen (an increase of 17,294 million yen from the previous year) due
to increases in notes and accounts receivable-trade and investment securities.
Total liabilities as of March 31, 2018 was 72,678 million yen (an increase of 4,637 million yen) due to increases in notes
and accounts payable-trade.
Net assets as of March 31, 2018 was 176,364 million yen (an increase of 12,657 million yen). As a result, the equity ratio
was 70.1% (an increase of 0.2 point).
(Position of Cash Flow)
Deducting income taxes paid from income before income taxes and non-controlling interests, depreciation andamortization, and gain and loss in working capital, net cash provided by operating activities for the consolidated fiscal year
ended March 31, 2018 was 37,691 million yen (32,491 million yen for the previous year).
Due to investment on plant and equipment, net cash used in investing activities for the consolidated fiscal year ended
March 31, 2018 was 15,244 million yen (13,152 million yen for the previous year).
Due to share repurchase, payment for dividends and of long-term loans payable, net cash used in financing activities3

for the consolidated fiscal year ended March 31, 2018 was 20,268 million yen (19,042 million yen for the previous year).
As a result, cash and cash equivalents for the consolidated fiscal year ended March 31, 2018 was 37,702 million yen(35,701 million yen for the previous year), reflecting 177 million yen effect of exchange rate changes. It increased by
2,000 million yen compared to the previous year.
<Reference> The transit of Cash Flow indices
For the year Ended
March 31, 2014

March 31, 2015

March 31, 2016

March 31, 2017

March 31, 2018

65.7

66.9

68.1

69.9

70.1

119.5

175.4

196.2

212.2

265.3

Debt repayment ratio (year)

1.5

1.7

1.1

0.9

0.8

Interest coverage ratio (times)

82.6

91.5

154.1

208.0

299.3

Shareholders’ equity ratio (%)
Shareholders’ equity ratio basedon market value (%)

Shareholders' equity ratio: shareholders' equity/total assets
Shareholders' equity ratio based on market value: market capitalization/total assets
Debt repayment ratio: interest-bearing liabilities/cash flows from operating activities
Interest coverage ratio: cash flows from operating activities/interest payments(Notes 1) All indicates are calculated based on consolidated financial figures.
(Notes 2) Market capitalization is calculated based on the number of shares outstanding, excluding treasury shares.
(Notes 3) Cash flows represents operating cash flow.
(Notes 4) Interest-bearing liabilities refer to all liabilities recorded in the consolidated balance sheets that incur interest.
(3) Basic Policy on Distribution of Earnings and Dividends for current and next term
The Company’s basic policy of profit allocation is returning to shareholders by improving company value
through increasing revenue in the medium and long terms.
We aim to realize dividend payout ratio to be 40% in FY2018 and maintain total payout ratio to be 70% in
medium-term business plan “Vista2021” launched from April 2016.
The year-end dividend is expected to be 36 yen per share. Accordingly, the total annual dividend per share for the current
year ended March 31, 2018 will become 68 yen, which was 52 yen in the previous year.
Total annual dividends per share for the next year ended FY2018 is scheduled to be 78 yen (second quarter: 38 yen,
year-end: 40 yen).

42. Management Policy(1) Basic Management Policy
As a group growing with customers, we will strengthen the brand nurtured by our faithful corporate culture andmaximize corporate value through productive activities for the society.

(2) Target Management Indicator
Our most important objectives are “Return on Equity (ROE)” which represents the efficiency of managing
shareholders’ equity and “Operate Profit Ratio to Sales” which leads to a high-value added company. We will
expand our business to increase our revenue.
We aim to realize Return on Equity (ROE) to be above 14% in medium-term business plan “Vista 2021”
launched in April 2016. We have achieved it in FY2016 and FY2017.

(3) Mid-and Long-term Management Strategies and Issues to be addressed
We have positioned "maximize the value of existing products and create new products" as our top priorities
in Stage I, the first three years of the medium-term business plan "Vista2021" (FY2016-2018). We also haveset forth three basic strategies: "maximize the profit from existing products", "improve marketing capability" and"enhance R&D capability".
We maintained an upward trend in both sales and profits, reaching our final income target one year ahead ofschedule in FY2017, which is the second year of the plan. However, the business climate surrounding us isundergoing rapid change, and various risks are emerging. By steadily implementing measures based on ourbasic strategies, we aim to establish a stronger incomes basis and further increase our corporate value.

In our first strategy, "maximize the profit from existing products", we will accelerate to develop advanced
materials -"EUV under layer materials" and "3D packaging process materials"- that will adapt to technologicalinnovations of semiconductors.
As a stepping stone to the full-scale entry into the Environment & Energy field, we are expanding our shale
oil and gas recovery enhancing materials -"nanoActiv HRT"- in North America. Manufacturing facilities andoperations to other local communities are also expanding.
In addition, we will continue to focus our efforts on the stable supply of "BRAVECTO®"- parasite drug forpets- whose active ingredients is our compound invention, Fluralaner.

In our second strategy, "improve marketing capability", we will commence operations at our subsidiary in
Suzhou, China from this summer. We are able to strengthen technical support and customer services in
China's display materials market, which is expected to grow significantly in the future. In order to expand
oversea agrochemical business, we established a subsidiary in Brazil in 2016 and in India in 2017. Thisestablishment support sales of agrochemicals in growing markets, enhance promotion and accelerate theproduct-development required by the market.
In addition, we opened an office in Silicon Valley, United States, in 2016. We will accelerate to develop

5talented personnel with high visibility and planning skills through collecting latest technical information. In
recent years, we have been collaborating with several venture companies. We will start activities in the AI(artificial intelligence) and Life Sciences fields.

In the third strategy, "enhance R&D capability," we have developed a new insecticide called "GRACIA" andplan to launch it in South Korea in 2018 and in Japan in 2019. We will continue to enhance our agrochemicals
and pharmaceuticals pipelines.
We will accelerate entry into new business fields by promoting the introduction of new materials andtechnologies through open innovation, such as "biological material creating collaboration" with Kyushu
University.
In addition, we are working to quickly establish synthetic methods that will reduce the manufacturing costs of
medium molecular pharmaceutical active ingredients such as peptides and nucleic acids.

This fiscal year will be the year which we formulate the medium-term business plan Stage II, starting from FY
2019. Although our recent results are favorable, we rely on some product to drive the company's performancecompared to the plan and new product launching schedule is dropping behind. Under such circumstance, wewill focus on building a growth strategy to realize the corporate vision of 2030, such as identifying socialchanges from a long-and medium- term viewpoint, creating new products and expanding our businessportfolio.

We have established the CSR Committee, the Risk Management and Compliance Committee and theEnvironment, Safety and Quality Assurance Committee based on our corporate philosophy, "contribute tosociety with superior technology, products and services, while striving for harmony with the environment" and"basic CSR policy". We will encourage improving transparency of management, compliance with laws andsocial imperative and contribution to environment and society. We will raise the collective effort to become agroup trusted by all of our stakeholders.

3. Basic approach to the Selection of Accounting Standards
The Company will research on trend of IFRS in the country and overseas and correspond properly when
applying IFRS.

6

4. Consolidated Financial Statements(1) Consolidated Balance Sheets(Million yen)
As ofMarch 31, 2017

As ofMarch 31, 2018

AssetsCurrent assets
Cash and deposits

35,70137,702

Notes and accounts receivable - trade

60,07565,422Merchandise and finished goods

28,602

29,85564

115

Raw materials and supplies

7,778

7,797

Accounts receivable - other

2,379

1,831

Short-term loans receivable

1,065

494

Deferred tax assets

2,708

3,019

Other

2,221

2,422

Work in process

Allowance for doubtful accounts
Total current assets

(33)

(34)

140,564

148,626

Non-current assets
Property, plant and equipment
Buildings and structures

62,25363,985

Accumulated depreciation and impairment loss

(38,428)(39,573)

Buildings and structures, net

23,824

24,411

Machinery, equipment and vehicles

120,540

125,451(109,038)(112,434)

11,50213,01735,71737,323(30,880)(32,261)

4,837

5,061

9,198

9,047

103

22

Accumulated depreciation

(90)

(22)

Leased assets, net

120Construction in progress

2,594

2,936

Total property, plant and equipment

51,96954,473

Software

610

775

Other

966

993

1,577

1,768

32,46538,517

Accumulated depreciation and impairment loss
Machinery, equipment and vehicles, net
Tools, furniture and fixtures
Accumulated depreciation and impairment loss
Tools, furniture and fixtures, net
Land
Leased assets

Intangible assets

Total intangible assets
Investments and other assets
Investment securities
Deferred tax assets

125

115

Net defined benefit asset

1,987

2,193

Other

3,156

3,440

(98)

(92)

Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

7

37,63644,174

91,183

100,416

231,748

249,043

(Million yen)
As ofMarch 31, 2017

As ofMarch 31, 2018

Liabilities
Current liabilities
Notes and accounts payable - trade

14,943

18,579

Short-term loans payable

23,15523,591

Current portion of long-term loans payable

3,070

2,554

Income taxes payable

3,288

5,156

Provision for bonuses

1,920

2,011

28

27

Other

11,25910,950Total current liabilities

57,66562,871Long-term loans payable

4,580

2,446

Deferred tax liabilities

2,649

4,341

Provision for business structure improvement

594

516

Provision for loss on business of subsidiaries and affiliates

309

309

Provision for directors' bonuses

Non-current liabilities

Net defined benefit liability

101

126

Other

2,141

2,068

Total non-current liabilities

10,376

9,807

68,041

72,67818,942

18,942

Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus

13,611

13,613Retained earnings

126,370

133,822

Treasury shares(7,587)(5,962)

Total shareholders' equity

151,337

160,416

10,07913,653243

125

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

8

380

390

10,703

14,170

1,666

1,778

163,707

176,364

231,748

249,043

(2) Consolidated Statements of Income / Consolidated Statements of Comprehensive Income- Consolidated Statements of Income(Million yen)
Year Ended
March 31, 2017

Year Ended
March 31, 2018

Net sales

180,289

193,389

Cost of sales

105,916

113,513Gross profit

74,372

79,876

Selling, general and administrative expenses

42,93444,887

Operating income

31,43834,988Non-operating income
Interest income

20

26

Dividend income

726

817

Equity in earnings of affiliates

701

1,324

Other

805

768

2,253

2,937

Interest expenses

156

126

Loss on disposal of non-current assets

601

591

Plant stop losses

274

270

Impairment loss

220-

Foreign exchange losses

314

460

Other

411

240

1,978

1,690

31,71336,235Extraordinary income--

Extraordinary losses--

Income before income taxes and non-controlling interests

31,71336,235

Income taxes - current

7,439

9,146

Total non-operating income
Non-operating expenses

Total non- operating expenses
Ordinary income

Income taxes - deferred

81

(214)

Total income taxes

7,520

8,932

Net income

24,192

27,302

Net income attributable to non-controlling interests
Net income attributable to owners of parent

9

166

159

24,02627,142

- Consolidated Statements of Comprehensive Income(Million yen)
Year Ended
March 31, 2017
Net income

Year Ended
March 31, 201824,192

27,302

(436)

3,575

Foreign currency translation adjustment

188

(124)

Remeasurements of defined benefit plans, net of tax

(174)

10

1

(1)

Other comprehensive income
Valuation difference on available-for-sale securities

Share of other comprehensive income of entities accounted forusing equity method
Total other comprehensive income
Comprehensive income

(420)

3,460

23,771

30,763

23,58430,609186

153(Comprehensive income attributable to)
Owners of parent
Non-controlling interests10(3) Consolidated Statements of Changes in Net Assets
For the Year Ended March 31, 2017 (From April 1, 2016 to March 31, 2017)(Million yen)
Total shareholders' equity
Capital stock

Balance at beginning of current
periodRetainedearnings

Capital surplus

18,942

13,611

Treasury shares

115,878(4,281)

Total
shareholders'equity144,151

Changes of items during period
Dividends of surplus(7,680)(7,680)Net income attributable to ownersof parent

24,02624,026

Change of scope of consolidation

(157)

(157)

Share repurchase(9,002)(9,002)00

Disposal of treasury shares

0Cancellation of treasury shares(0)(5,695)

5,695

-

-

-

10,492(3,305)

7,186

18,942

13,611

126,370(7,587)

151,337

Net changes of items other thanshareholders' equity
Total changes of items during period
Balance at end of current period

Accumulated other comprehensive income
Total
Valuation
Foreign currency Remeasurements
accumulateddifference ontranslationof defined benefit
otheravailable-for-saleadjustment
planscomprehensive
securities
incomeBalance at beginning of current
period10,515

171554

11,241

Non-controllinginterests

1,531

Total
net assets

156,924

Changes of items during period
Dividends of surplus(7,680)Net income attributable to ownersof parent

24,026

Change of scope of consolidation(157)

Share repurchase(9,002)

Disposal of treasury shares

0Cancellation of treasury shares-

Net changes of items other thanshareholders' equity

(435)

72

(174)

(537)

134

(403)

Total changes of items during period

(435)

72

(174)

(537)

134

6,782

Balance at end of current period

10,079243

380

10,703

1,666

163,70711

For the Year Ended March 31, 2018 (From April 1, 2017 to March 31, 2018)(Million yen)
Total shareholders' equity
Capital stock

Balance at beginning of current
periodCapital surplus

18,942Retainedearnings

13,611

Treasury shares

126,370(7,587)

Total
shareholders'equity151,337

Changes of items during period
Dividends of surplus(9,063)(9,063)

Net income attributable to ownersof parent

27,142

27,142

Share repurchase
Cancellation of treasury shares(10,627)

Change in ownership interest ofparent due to transactions with
non-controlling interests
Net changes of items other thanshareholders' equity
Total changes of items during period
Balance at end of current period(9,002)(9,002)

10,627

-

2

2

-

2

7,452

1,624

9,078

18,942

13,613

133,822(5,962)

160,416

Accumulated other comprehensive income
Total
Valuation
Foreign currency Remeasurements
accumulateddifference ontranslationof defined benefit
otheravailable-for-saleadjustment
planscomprehensive
securities
incomeBalance at beginning of current
period10,079243

380

10,703

Non-controllinginterests

1,666

Total
net assets

163,707

Changes of items during period
Dividends of surplus(9,063)

Net income attributable to ownersof parent

27,142

Share repurchase(9,002)

Cancellation of treasury shares
Change in ownership interest ofparent due to transactions with
non-controlling interests
Net changes of items other thanshareholders' equity

2
3,574

(118)

10

3,466

111

3,578

Total changes of items during period

3,574

(118)

10

3,466

111

12,657

Balance at end of current period

13,653125

390

14,170

1,778

176,36412

(4) Consolidated Statements of Cash Flows(Million yen)
Year Ended
March 31, 2017

Year Ended
March 31, 2018

Cash flows from operating activities
Income before income taxes and non-controlling interests

31,71336,235

Depreciation and amortization

8,889

10,510

Impairment loss

220-

Interest and dividend income

(746)

(844)

Interest expenses

156

126

Increase (decrease) in provision for business structure improveme

(86)

-

601

591

Decrease (increase) in notes and accounts receivable - trade

Loss (gain) on disposal of non-current assets(2,573)(5,266)

Decrease (increase) in inventories

2,054(1,309)

Increase (decrease) in notes and accounts payable - trade

(334)

3,494

Other

(474)

(328)

Subtotal

39,41943,209Interest and dividend income received

2,175

1,881

Interest expenses paid

(156)

(125)

Income taxes paid

(8,947)(7,273)

Net cash provided by (used in) operating activities

32,491

37,691

Purchase of investment securities

(787)

(759)

Proceeds from sales of investment securities

2,988

65

Purchase of property, plant and equipment(12,394)(13,768)

Cash flows from investing activities

Payments for retirement of property, plant and equipment

(477)

(405)

(1,091)(585)

Net decrease (increase) in short-term loans receivable

(12)

546

Purchase of long-term prepaid expenses

(834)

(67)

Purchase of intangible assets

Other

(542)

(270)

(13,152)(15,244)

Net increase (decrease) in short-term loans payable

220

501

Proceeds from long-term loans payable

550

420

Repayments of long-term loans payable(3,060)(3,070)Cash dividends paid

(7,680)(9,063)

Net cash provided by (used in) investing activities
Cash flows from financing activities

Dividends paid to non-controlling interests
Share repurchase
Other
Net cash provided by (used in) financing activities

(52)

(39)

(9,002)(9,002)

(17)

(14)

(19,042)(20,268)

Effect of exchange rate change on cash and cash equivalents

94

(177)

Net increase (decrease) in cash and cash equivalents

390

2,000

35,33535,701(25)-

35,70137,702

Cash and cash equivalents at beginning of period
Decrease in cash and cash equivalents resulting from exclusion ofsubsidiaries from consolidation
Cash and cash equivalents at end of period13(5) Notes to Consolidated Financial Statements(Going Concern Assumption)
Not applicable.

(Segment and Related Information)
Segment Information
1. General Information about reportable segments
The Company's reportable segments are components of the Group that engage in business activities, whose operating
results are regularly reviewed by the Board of Directors when making resource allocation and performance assessment
decisions, and for which discrete financial information is available.
Divisions by products and services are located in the headquarter, and each division works out a comprehensive
strategy applicable to their products and services and carries out their business activities.
The Company consists of segments based on divisions as follows:
Main Products

Segment

Basic chemicals (melamine, sulfuric acid, nitric acid, ammonia, etc.)
Chemicals

Fine chemicals (epoxy compound for LED sealants, solder resist and painting,flame retardants, chlorinated cyanuric acid for sterilizing, etc.)
Display materials (LCD alignment coating, etc.)

Performance
Materials

Semiconductor materials (bottom anti-reflective coating for semiconductors, etc.)
Inorganic materials (hard coating materials, electronic information materials, polishing materials, etc.)

Agricultural Chemicals
Pharmaceuticals

Agrochemicals (herbicides, insecticides, fungicides, combination fungicide and insecticide, and plant growth regulators)
Animal health products
LIVALO (anti-cholesterol drug), etc.
Finetech (custom manufacturing and process researching services for pharmaceutical companies)

Trading

Trading, etc.

OthersTransportation, landscaping, engineering, fertilizer, etc.

2. Basis of measurement of reported segment income or loss, segment assets and other material items
The accounting policies for the reportable segments are consistent with the Company's accounting policies used in the preparationof its consolidated financial statements. Intersegment sales and income (loss) are recognized based on current market prices.

143. Information Regarding Sales, Income (Loss), and Segment Assets of Reportable Segments
1) For the Year Ended March 31, 2017 (From April 1, 2016 to March 31, 2017)
Performance Agricultural
Chemicals
Materials
Chemicals(Million yen)Pharmaceuticals

Trading

Others

Total

Adjustment(1)

Consolidated
Total
180,289

Sales
Customers

25,723

46,40347,791

7,966

42,281

10,108180,27414Intersegment

9,057

6,406

4,160

26

12,916

13,921

46,489(46,489)－

Total sales

34,78052,80951,952

7,992

55,19824,029226,764(46,474)

180,289

Operating income (loss)

3,820

12,533

13,201

1,656

1,697

966

33,875(2,437)31,438Segment assets

26,11348,02855,588

10,182

19,782

10,731

170,426

61,322

231,748

1,613

4,763

1,336

705

59

330

8,808

79

8,887

Amortization of goodwill－
Increase of property,
2,000
plant and equipment
and intangible assets(Notes 1) The adjustments are as follows:

－

－

－

2

－

2

－

2

8,404

2,416

903

46

299

14,070229

14,299Other items
Depreciation andamortization(1) The (2,437) million yen adjustment in segment income includes (285) million yen in intersegment eliminations, 14 million yen sales
not attributable to any reporting segment, and (2,165) million yen corporate expenses not attributable to any reportable segment.
The corporate expenses are mainly group administrative expenses which do not belong to segments.
(2) The 61,322 million

yen adjustment

in segment

assetsincludes

(9,338) million

yen in intersegment

eliminations

and 70,660

million yen in corporate assets not attributable to any reportable segment. The corporate assets are mainly group administrative assets which
do not belong to segments.
(3) The 79 million yen adjustment in depreciation and amortization is corporation expenses.
(4) The 229 million yen adjustment in increase of property, plant and equipment and intangible assets is corporate assets. The corporate assets
are mainly group administrative assets which do not belong to segments.
2) For the Year Ended March 31, 2018 (From April 1, 2017 to March 31, 2018)
Performance Agricultural
Chemicals
Materials
Chemicals(Million yen)Pharmaceuticals

Trading

Others

Total

Adjustment(1)

Consolidated
Total
193,389

Sales
Customers

25,546

51,97354,262

7,493

44,474

9,638

193,389－

Intersegment

9,390

6,789

3,876

26

15,012

11,822

46,917(46,917)－

Total sales

34,93758,762

58,1387,520

59,486

21,461

240,306(46,917)

193,389

Operating income (loss)

3,410

14,20016,370

1,233

1,826

612

37,653(2,665)34,988Segment assets

26,97652,93856,571

9,118

23,393

9,658

178,656

70,387

249,043

1,733

5,925

1,416

713

52

319

10,161347

10,508

Amortization of goodwill
1
Increase of property,
2,594
plant and equipment
and intangible assets(Notes 1) The adjustments are as follows:

－

－

－

－

－

1

－

1

7,209

2,541

679

23

304

13,352341

13,694

Other items
Depreciation andamortization(1) The (2,665) million yen adjustment in segment income includes (254) million yen in intersegment eliminations and (2,410) million yen corporate
expenses not attributable to any reportable segment.
The corporate expenses are mainly group administrative expenses which do not belong to segments.
(2) The 70,387 million

yen adjustment

in segment

assetsincludes

(8,200) million

yen in intersegment

eliminations

and 78,588

million yen in corporate assets not attributable to any reportable segment. The corporate assets are mainly group administrative assets which
do not belong to segments.
(3) The 347 million yen adjustment in depreciation and amortization is corporation expenses.
(4) The 341 million yen adjustment in increase of property, plant and equipment and intangible assets is corporate assets. The corporate assets
are mainly group administrative assets which do not belong to segments.

15

Related Information
For the Year Ended March 31, 2017 (From April 1, 2016 to March 31, 2017)
Sales by region(Million yen)
Other Asia Europe andConsolidated(except Japan the United
Total
Statesand Korea)

Japan

Korea

103,077

15,51339,286

22,412

180,289

Note: Sales are classified to either countries or regions based on customers are located.
For the Year Ended March 31, 2018 (From April 1, 2017 to March 31, 2018)
Sales by region(Million yen)
Other Asia Europe andConsolidated(except Japan the United
Total
Statesand Korea)

Japan

Korea

104,523

20,21839,33929,308

193,389

Note: Sales are classified to either countries or regions based on customers are located.

Information regarding impairment loss on non-current assets by reportable segments
For the Year Ended March 31, 2017 (From April 1, 2016 to March 31, 2017)
Performance
Materials

Chemicals

Agricultural
Chemicals

Pharmaceuticals

Trading

Others

Total

Adjustment

Impairment loss
－
－
－
－
－
－
－
(Note) 220 million yen adjustment is impairment loss on our head office involved in head office relocation.

220(Million yen)
Consolidated
Total

220

For the Year Ended March 31, 2018 (From April 1, 2017 to March 31, 2018)
Not applicable.

Information regarding amortization and unamortized balance on goodwill by reportable segments
For the Year Ended March 31, 2017 (From April 1, 2016 to March 31, 2017)

Balance as ofMarch 31, 2017

Chemicals

Performance
Materials

Agricultural
Chemicals－－－

Pharmaceuticals

Trading－

Others

Total

－

0

Adjustment

0－(Million yen)
Consolidated
Total

0

For the Year Ended March 31, 2018 (From April 1, 2017 to March 31, 2018)
Chemicals

Balance as ofMarch 31, 20186

Performance
Materials

Agricultural
Chemicals－－

Pharmaceuticals

Trading－－

16

Others

Total－

Adjustment

6－(Million yen)
Consolidated
Total

6

(Per Share Information)(Yen)
Year Ended March 31, 2017

Year Ended March 31, 2018

Net asset per share

1,067.76

1,168.07

Net income per share

156.97180.30Notes:
1. Since residual securities do not exist, diluted net income per share is not presented.
2. Net income per share is calculated on the following basis.
(Million yen)
Year Ended March 31, 2017

Year Ended March 31, 2018

Net income per share
Net income attribute to owners of parent

24,026

Amounts not allocated to ordinary shares－

27,142－

Net income allocated to ordinary shares
Average number of ordinary shares
outstanding during each year

24,02627,142

153,058,176

150,542,352

3. Net asset per share is calculated on the following basis.
(Million yen)
Year Ended March 31, 2017
Net asset

Year Ended March 31, 2018

163,707

176,364

Amount deducted from net asset

1,666

1,778

(Non-controlling interest)
Net asset as of year end allocated toordinary shares
Number of ordinary shares as of year
end used to calculate net asset per share(1,666)(1,778)162,041

174,586

151,757,983

149,465,438(Significant Subsequent Events)
1.The Company, at the Board of Director’s meeting held on April 24, 2018, has decided to cancel its own shares under Article 178of the Japanese Corporation Act.
(1) Class of shares to be cancelled :Common shares of company(2) Number of shares to be cancelled :1,000,000 shares (0.66% of issued shares prior to cancellation)(3) Scheduled date of cancellation :May 8, 2018

Reference
Number of issued shares subsequent to cancellation (including treasury shares) : 150,000,000 shares
2. The Company, at the Board of Director’s meeting held on May 11, 2018, has decided to repurchase its shares in the market
under Article 156 of the Japanese Corporation Act, as applied pursuant to Article 165, Paragraph 3 of the same Act.
(1) Purpose of repurchaseTo facilitate flexible implementation of capital policy in response to changes in the business environment.
(2) Details of repurchase①Class of shares:

Common shares of the company②Total number of shares:

Up to 1,300,000 shares (Rate of the maximum shares to be acquired
to the total outstanding shares: 0.87%)③Total amount:④Period of repurchase:
Reference
Number of treasury shares as of May 8, 2018
Total number of shares issued (excluding treasury shares)
Number of treasury shares

Up to 5,000,000,000 yen
From May 14, 2018 to July 31, 2018

: 149,465,312 shares:
534,688 shares17