Consolidated Financial Results for the Six Months Ended September 30, 2014
(JPGAAP)
November 5, 2014
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, Head of Finance and Accounting Department Tel. +81 3 3296 8356
Scheduled dividend payment date: December 1, 2014
Supplemental information: Yes
Financial results meeting: Yes (for institutional investors and analysts)( Amounts rounded down to the nearest million yen)(% indicates the rate of increase/decrease year on year)

1. Consolidated Financial Results for the Six Months Ended September 30, 2014 (From April 1, 2014 to September 30, 2014)(1) Consolidated Operating Results(Millions of Yen)

Net Sales

Operating
IncomeOrdinary
IncomeNet Income

Six Months Ended September 30, 2014

79,920 +4.6%

12,506 +18.2%

12,728 +14.5%

8,850 +11.2%

Six Months Ended September 30, 2013

76,401 +7.4%

10,577 +23.3%

11,120 +32.6%

7,961 +41.5%

Six Months Ended September 30, 2014:

10,187 million yen+1.9%

Six Months Ended September 30, 2013:

10,001 million yen +100.1%(Note) Comprehensive Income:Net Income
per Share (Yen)

Diluted Net Income
per Share (Yen)Six Months Ended September 30, 2014

55.15

－

Six Months Ended September 30, 2013

48.62

－

(2) Consolidated Financial Position(Millions of Yen)

Total Assets

Net Assets

Equity Ratio

As of September 30, 2014

196,750

145,604

73.3%

As of March 31, 2014

207,999

137,82265.7%(Note) Shareholders' equity:

As of September 30, 2014:

144,257 million yen

As of March 31, 2014:

136,552 million yen

2. Cash Dividends
Cash Dividends per ShareFirst Quarter

Second Quarter

Year Ended March 31, 2014－

14.00 yen

Year Ending March 31, 2015－

14.00 yen

Year Ending March 31, 2015 (Forecast)Third Quarter

Year-end

Annual－16.00 yen

30.00 yen－

16.00 yen

30.00 yen

(Note) Revision of the latest forecast of cash dividends: No

3. Forecast of Consolidated Financial Results for the Fiscal Year Ending March 31, 2015 (From April 1, 2014 to March 31, 2015)(Millions of Yen)

Net SalesYear Ending March 31, 2015

171,000 +4.5%(Note) Revision of the latest forecast of financial results: Yes

Operating
IncomeOrdinary
IncomeNet Income

24,100 +8.3%

24,800 +4.5%

17,800 +6.6%

Net Income
per share
110.92 yen4. Notes(1) Changes in significant consolidated subsidiaries(changes in specified subsidiaries involving changes in scope of consolidation)(2) Adoption of special accounting methods of preparation of quarterly financial statements: None: None(3) Changes of accounting policies and accounting estimates, and restatement
1. Changes of accounting policies due to revisions of accounting standards: Yes

2. Changes of accounting policies other than the above: None3. Changes in accounting estimates: None4. Restatements: None(4) Number of shares outstanding (common stock)
1. Number of shares outstanding (including treasury stock)
as of September 30, 2014;

161,000,000 shares

as of March 31, 2014;

161,000,000 shares

2. Number of shares of treasury stock
as of September 30, 2014;

522,752 shares

as of March 31, 2014;

522,032 shares

3. Average number of shares outstanding during the six months
ended September 30, 2014; 160,477,714 shares
ended September 30, 2013; 163,741,628 shares* Implementation status about the quarterly review
This 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.
* Statement regarding appropriate use of forecasts and other notes
The 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.
For supplemental information, please refer to our website.

Table of Contents for Attached Materials

1. Qualitative Information on Quarterly Results …………..………………………………………………………………………… 2(1) Explanation of Operating Results ………………………………………………………………………………………………. 2(2) Explanation of Financial Position ……………………………………………………………………………………………….. 4(3) Explanation of future forecast information, such as Forecast of Consolidated Financial Results ……………………..... 5
2. Items concerning Summary Information (Notes) ………………………………………………………………………………... 6(1) Changes of accounting policies and accounting estimates, and restatement …………………………………………….. 6
3. Consolidated Financial Statements ……………………………………………………………………………………………..... 7(1) Consolidated Balance Sheets …………………………………………………………………………………………………… 7(2) Consolidated Statements of Income and Statements of Comprehensive Income ………………………………………... 9(3) Consolidated Cash Flow …………………………………………………………………………………………………….….. 11(4) Notes to Consolidated Financial Statements ……………………………………………………………………………….... 12(Notes on Assumption of Going Concern) …………………………………………………………………..…………..... 12(Notes on Significant Changes in Stockholders' Equity) …………………………………………………….………….. 12(5) Segment Information …………………………...………………………………………………………………………............. 12－1－

1. Qualitative Information on Quarterly Results(1) Explanation of Operating Results
During the six months ended September 30, 2014 (from April 1, 2014 to September 30, 2014), the domestic employment andincome situations improved, while its economy continued to be on the gradual recovery trend under the influence of a counter
reaction to the rush demand before the consumption tax hike. With regard to our group business, Chemicals Segment wasaffected by remained high price of raw materials and fuels, and by the deterioration of melamine’s market. As for Performance
Materials Segment, Display Materials and Semiconductor Materials continued to have healthy sales. As for Agrochemicals
Segment, Fluralaner (the active substance of veterinary medical product) had healthy sales. As for Pharmaceutical Segment,
domestic “LIVALO” (anti-cholesterol drug) sales decreased due to the influence of generic products.
As a result, the sales for this term were 79,920 million yen (an increase of 3,519 million yen from the same term of theprevious year). Operating income was 12,506 million yen (an increase of 1,928 million yen). Net income was 8,850 million yen(an increase of 889 million yen).

Explanations by segments are as below.

Chemicals
As for Basic Chemicals, the sales of melamine (adhesive agent for particle board) decreased both domestically andinternationally. As for Fine Chemicals, the sales of “TEPIC” (epoxy compound for LED sealants, solder resist, painting) increased
due to weak yen, while “HI-LITE” (chlorinated isocyanuric acid for sterilizing) had a hard time with price-cutting competition.
As a result, the sales of this segment were 16,695 million yen (a decrease of 1,163 million yen from the same term of theprevious year). Operating income was 416 million yen (a decrease of 360 million yen).

Performance Materials“SUNEVER” (LCD alignment coating) mainly for smartphone continued to have healthy sales. The demands for BARC andmulti-layer process materials increased due to the miniaturization of semiconductors. The sales of “SNOWTEX” (silica sol forpolishing electronic materials and non-polishing materials) exceeded previous year for polishing electronic materials.
As a result, the sales of this segment were 24,239 million yen (an increase of 3,627 million yen from the same term of theprevious year). Operating income was 6,677 million yen (an increase of 2,302 million yen).

Agrochemicals
With regard to the domestic sales, the sales volume of “ROUNDUP” (non-selective herbicide) and “ALTAIR” (paddy riceherbicide) increased. The export sales significantly increased especially due to the launch of veterinary medical product including
Fluralaner in Europe and the United States of America,
As a result, the sales of this segment were 18,531 million yen (an increase of 2,529 million yen from the same term of theprevious year). Operating income was 3,954 million yen (an increase of 1,581 million yen).

－2－

Pharmaceuticals
Export “LIVALO” had healthy sales mainly in the United States of America and Asia. Domestic “LIVALO” sales drasticallydecreased due to the influence of generic products. On the other hand, “Custom Chemicals” (custom manufacturing and process
researching services for pharmaceutical companies) had healthy sales.
As a result, the sales of this segment were 4,998 million yen (a decrease of 1,350 million yen from the same term of theprevious year). Operating income was 1,598 million yen (a decrease of 1,577 million yen).

Trading
The sales of display materials related products and agrochemicals products increased.
As a result, the sales of this segment were 27,297 million yen (an increase of 285 million yen from the same term of theprevious year). Operating income was 904 million yen (an increase of 230 million yen).

Others
The sales of this segment were 8,460 billion yen (a decrease of 1,270 million yen from the same term of the previous year).
Operating loss was 27 million yen (a decrease of 263 million yen).

－3－(2) Explanation of Financial Position(Position of Assets, Liabilities and Net Assets)
Due to the decrease of cash and deposits, notes and accounts receivable-trade, assets as of September 30, 2014 were
196,750 million yen (a decrease of 11,248 million yen from March 31, 2014).
Due to the decrease of liabilities with interest, total liabilities as of September 30, 2014 were 51,146 million yen (a decrease of
19,030 million yen from March 31, 2014).
Net Assets as of September 30, 2014 were 145,604 million yen (an increase of 7,781 million yen from March 31, 2014).
As a result, equity ratio was 73.3%, an increase of 7.6% from March 31, 2014.

(Position of Cash Flow)
Deducting income taxes paid from income before income taxes and minority interests, depreciation and gain and loss on
working capital, net cash provided by operating activities for six months ended September 30, 2014 (from April 1, 2014 toSeptember 30, 2014) were 22,902 million yen (22,753 million yen for the same term of the previous year).
Due to the acquisitions on plant and equipment of research and development division, net cash used in investing activities forthe six months ended September 30, 2014 were 2,770 million yen (7,748 billion yen for the same term of the previous year).
Due to the decrease in borrowings and dividends payment, net cash used in financing activities for the six months ended
September 30, 2014 were 23,332 million yen (19,071 million yen for the same term of the previous year).
As a result, cash and cash equivalents at the end of this term was 27,648 million yen, reflecting 91 million yen effect of
exchange rate changes. It decreased by 3,109 million yen from March 31, 2014 (28,048 million yen as of September 30, 2013.).

－4－

(3) Explanation of future forecast information, such as Forecast of Consolidated Financial Results
Though domestic LIVALO sales are expected to fall short of the previous forecast, sales of electronic materials andagrochemicals will exceed the previous forecast. As a result, the Company revised its forecast as below.

Revision of Forecast for the Year Ending March 31, 2015 (From April 1, 2014 to March 31, 2015)(Millions of Yen)
Net Sales

Operating

Ordinary

IncomeIncomeNet Income

Net Income
per Share (Yen)Previous Forecast (A)170,000

23,50024,00017,500109.05

Revised Forecast (B)171,000

24,10024,80017,800110.92

Change (B-A)

1,000

600

800

300

―

Rate of Change (%)

0.6%

2.6%

3.3%

1.7%

―

163,658

22,24623,723

16,701102.11(Ref.) Results for the Year
Ended March 31, 2014

Business Segment Information of Revised Forecast(Billions of Yen)

Net Sales

Operating

Previous

Revised

Forecast

Forecast

Chemicals

34.5

34.6

0.1

Performance Materials

47.1

48.3

1.2

Agrochemicals

43.9

45.3

1.4

Pharmaceuticals

9.8

8.8

-1.0

Trading

53.6

55.6

2.0

Others

21.5

21.5

―

Adjustment

-40.4

-43.1

-2.7

Total

170.0

171.0

1.0

Chemicals

1.5

1.6

0.1

Performance Materials

10.7

11.3

0.6

Agrochemicals

8.0

9.1

1.1

Pharmaceuticals

3.1

1.9

-1.2

Trading

1.6

1.8

0.2

Others

0.4

0.5

0.1

Adjustment

-1.8

-2.1

-0.3

Total

23.5

24.1

0.6

ChangeIncome－5－

2. Items concerning Summary Information (Notes)(1) Changes of accounting policies and accounting estimates, and restatement
Effective from the beginning of current consolidated financial year, the Company adopted paragraph 35 of the "AccountingStandard for Retirement Benefits" (ASBJ Statement No.25 on May 17, 2012) and paragraph 67 of the "Guidance on AccountingStandard for Retirement Benefits" (ASBJ Statement No.25 on May 17, 2012).
Affecting the above change, the Company reviewed the calculation method of retirement benefit obligations and service costs.
The Company changed the method of attributing expected benefit to periods primarily from straight-line attribution to benefit
formula basis as well as the decision method of the discount rate.
The term of bond which is the basis of the discount rate determination was changed from calculating with years approximate
to employees' average estimated remaining service years to weighted average discount rate reflecting the estimated payment
term of retirement benefits and its amount.
In accordance with transitional accounting as stipulated in paragraph 37 of the Accounting Standard for Retirement Benefits,
the effect of the changes in the calculation methods of retirement benefit obligations and service costs were adjusted in retained
earnings at the beginning of current consolidated financial year.
As a result, asset for retirement benefit increased by 331 million yen and retained earnings increased by 213 million yen at the
beginning of current consolidated financial year. There was a slight effect on operating income, ordinary income and net income
before taxes for the six months ended September 30, 2014.

－6－

3. Consolidated Financial Statements(1) Consolidated Balance Sheets(Millions of Yen)

As of
March 31, 2014

As of
September 30, 2014

AssetsCurrent assets
Cash and deposits

30,757

Notes and accounts receivable-trade

54,04142,641

Merchandise and finished goods

26,77527,293Work in process

27,64851

668

Raw materials and supplies

6,353

7,303

Other

7,457

6,602

Allowance for doubtful accounts

-22

-24

125,413112,133

Buildings and structures, net

19,52022,362Other, net

25,455

24,796

Total property, plant and equipment

44,97547,159Goodwill

481

165

Other

769

718

1,251

883

Investment securities

33,57033,197

Other

3,028

3,601

Total current assets
Noncurrent assets
Property, plant and equipment

Intangible assets

Total intangible assets
Investments and other assets

Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets

－7－

-240

-225

36,35836,57382,58584,616

207,999

196,750

(Millions of Yen)

As of
March 31, 2014

As of
September 30, 2014

Liabilities
Current liabilities
Notes and accounts payable-trade

16,067

14,868

Short-term loans payable

30,645

10,724

Income taxes payable

3,512

3,334

Provision for bonuses

1,754

1,787

Provision for directors' bonuses

27

13

Other

7,646

10,065Current liabilities

59,65240,794Long-term loans payable

5,450

4,750

Net defined benefit liability

244

212

Noncurrent liabilities

Other

4,829

5,389

Total noncurrent liabilities

10,524

10,35170,176

51,146

Capital stock

18,942

18,942

Capital surplus

13,611

13,611Retained earnings

98,121

104,617

Total liabilities
Net assets
Shareholders' equity

Treasury stock
Total shareholders' equity

-698

-700

129,975

136,471

Accumulated other comprehensive income
Valuation difference on available-for-sale securities

6,138

6,887

Foreign currency translation adjustment

20

508

Remeasurements of defined benefit plans

417

389

6,576

7,786

1,269

1,346

Total accumulated other comprehensive income
Minority interests
Total net assets
Total liabilities and net assets－8－

137,822

145,604

207,999

196,750

(2) Consolidated Statements of Income / Consolidated Statements of Comprehensive income- Consolidated Statements of Income(Millions of Yen)

Six Months Ended
September 30, 2013

Six Months Ended
September 30, 2014

Net sales

76,401

79,920

Cost of sales

47,32648,250Gross profit

29,074

31,669Selling, general and administrative expenses

18,496

19,163Operating income

10,577

12,506

Interest income

99Dividends income

266

292

Equity in earnings of affiliates

384

294

Other

721

457

1,382

1,054

Interest expenses

158

126

Loss on disposal of noncurrent assets

147

170

Plant stop loss

396

265

Other

138

269

Total non-operating expenses

839

831

11,12012,728

-

-

-

390

Non-operating income

Total non-operating income
Non-operating expenses

Ordinary income
Extraordinary income
Extraordinary loss
Product compensation expense-

390

Income before income taxes and minority interests

Total extraordinary loss

11,12012,338

Income taxes-current

3,150

3,569

Income taxes-deferred

-77

-163

Total income taxes

3,073

3,406

Income before minority interests

8,047

8,931

Minority interests in income
Net income

－9－

86

80

7,961

8,850

- Consolidated Statements of Comprehensive Income(Millions of Yen)
Six Months Ended
September 30, 2014

Six Months Ended
September 30, 2013
Income before minority interests

8,047

8,931

1,409

749

547

534

Remeasurements of defined benefit plans, net of tax--27

Share of other comprehensive income ofassociates accounted for using equity method-2-0

Other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment

Total other comprehensive income
Comprehensive income

1,954

1,255

10,001

10,187

9,877

10,060124126Comprehensive income attributable toComprehensive income attributable to owners of the parent
Comprehensive income attributable to minority interests－10－(3) Consolidated Statements of Cash Flows(Millions of Yen)

Six Months Ended
September 30, 2013

Six Months Ended
September 30, 2014

Net cash provided by (used in) operating activities
Income before income taxes and minority interests

11,12012,338Depreciation

3,973

3,713

Interest and dividends income

-276

-302

Interest expenses

158

126

Loss (gain) on disposal of noncurrent assets
Decrease (increase) in notes and accounts receivable-trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable-trade

147

170

14,802

11,591-760-1,947-3,163-1,208

Other

168

1,935

Subtotal

26,17026,417

Interest and dividends income received

662

362

Interest expenses paid

-162

-138

Income taxes paid

-3,916-3,738Net cash provided by (used in) operating activities

22,75322,902

Purchase of investment securities-327-1,307

Proceeds from sales of investment securities

244

3,040

Purchase of stocks of subsidiaries and affiliates-2,749-Purchase of property, plant and equipment

Net cash provided by (used in) investing activities-4,067-3,824

Payments for retirement of property, plant and equipment

-89

-113

Net decrease (increase) in short-term loans receivable

-466

-96

Other

-293

-469

-7,748-2,770Net increase (decrease) in short-term loans payable-14,016-15,236

Repayment of long-term loans payable-2,690-5,456

Cash dividends paid

Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities-2,292-2,567

Cash dividends paid to minority shareholders

-48

-50

Other

-24

-21

-19,071-23,332

Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents

236

91

Net increase (decrease) in cash and cash equivalents-3,830-3,109Cash and cash equivalents at beginning of period

31,87830,757

Cash and cash equivalents at end of period

28,04827,648－11－

(4) Notes to Consolidated Financial Statements(Notes on Assumption of Going Concern)
Not applicable.
(Notes on Significant Changes in Stockholders' Equity)
Not applicable.
(5) Segment Information
1. Information Regarding Sales, Income (Loss) of Reportable Segments
1) For the Six Months Ended September 30, 2013 (From April 1, 2013 to September 30, 2013)
Performance
AgroPharmaChemicals
Trading
OthersMaterials
chemicalsceuticals

Total(Millions of Yen)
Adjustment Consolidated
(1)
Total

Sales

13,453

17,934

14,534

6,341

19,691

4,446

76,401－

Intersegment

4,405

2,678

1,467

7

4,801

5,284

18,646-18,646－

Total Sales

17,85920,612

16,002

6,349

24,492

9,731

95,047-18,646

76,401

777

4,375

2,373

3,176

674

236

11,613-1,035

10,577

Operating Income(loss)

76,401

Notes: (1) The negative 1,035 million yen adjustment in segment income includes 307 million yen in intersegment eliminations andnegative 727 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) For the Six Months Ended September 30, 2014 (From April 1, 2014 to September 30, 2014)
Agrochemicals

Pharmaceuticals(Millions of Yen)

Chemicals

Performance
Materials

Sales

12,114

21,39017,151

4,998

20,240

4,023

79,920－Intersegment

4,580

2,849

1,379

－

7,057

4,436

20,304-20,304－

Total Sales
16,69524,23918,531
4,998
27,2978,460
100,224-20,304
Operating Income
416
6,677
3,954
1,598
904
-27
13,525-1,018(loss)
Notes: (1) The negative 1,018 million yen adjustment in segment income includes 102 million yen in intersegment eliminations and79,920

Trading

Others

Total

Adjustment Consolidated
(1)
Total

negative 915 million yencorporate expenses not attributable to any reportable segment.
The corporate expenses are mainly group administrative expenses which do not belong to segments.
2. Change in reportable segment
Reflecting the organizational change implemented in October 1, 2013, Nissan Chemical has shifted the Custom Chemicals
from the Chemicals to the Pharmaceuticals from the third quarter ended December 31, 2013.
The segment information for the second quarter ended September 30, 2013 has been revised to reflect the above change.
Main products based on new segmentation are as below.
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 retardant, chlorinated isocyanuric acid for sterilizing, etc)

Performance
Materials

Display Materials (LCD alignment coating, etc)
Semiconductor Materials (bottom anti-reflective coating for semiconductors, etc)
Inorganic Materials (hard coating materials, electronic information materials, polishing materials, etc)

Agrochemicals
Pharmaceuticals

Agrochemicals (herbicide, insecticide, fungicide, fungicide and insecticide, plant growth regulator)
active substance of veterinary medical product
LIVALO (anti-cholesterol drug), etc
Custom Chemicals (custom manufacturing and process services for pharmaceutical companies)

Trading

Trading, etc

Otherstransportation, landscaping, engineering, fertilizer, etc－12－79,92012,506