IR Briefing for 2Q
Fiscal Year Ending March 2020
Progress During Year 3 of NC2020,
Our Medium-Term Management Plan

Inabata & Co., Ltd.
Katsutaro Inabata, President and Representative Director

December 3, 20191

Contents

Page
3

Company Overview

5

New Challenge 2020 (NC2020),
Our Medium-Term Management Plan

8

Progress in Year 3 of NC2020

18

Returning Profits to Shareholders

21

Reference Materials

2Company Overview

About Inabata:
1. Founded in 1890

Inabata Dye Shop (Nishijin, Kyoto)

The Company was founded in Kyoto in 1890 as an importer ofdyestuffs. The business was later expanded with a focus on
chemicals.

2. A globally expanding, multifaceted
trading company
The company operates at 60 locations across 17 countries. Business
functions include market development, manufacturing and processing,logistics, and finance. Our plans and proposals are based on
specialized expertise and knowledge of products and markets.
3Company Overview

3. Four business segments
We operate in four segments: Information & Electronics, Chemicals,Life Industry, and Plastics.

Life Industry

6%
Chemicals

13%

FY03/19 Plastics
Net sales: 47%¥634.7 billion
Information &Electronics

34%

Note: In FY03/20, the Housing & Eco Materials segment was combined with the Chemicals segment.

4 New Challenge 2020 (NC2020),
Our Medium-Term Management Plan

5

Quantitative Targets of NC2020

NC2020, a four-year medium-term
management plan ending in FY03/21
Quantitative targets

FY03/21Net sales¥730.0 billion

Operating profit¥15.5 billion

Ordinary profit¥16.0 billion

Profit attributable toowners of parent¥12.0 billion

Net D/E ratio

0.4x or less

Assumed exchange rate

Note: Net D/E ratio = (interest-bearing debt – cash and deposits) / equity capital

USD1 = JPY110

6

Key
Initiatives for NC2020
medium-term
management plan

ＮＣ2０2０

重点施策

1

Further expansion and deeper involvement in overseas businesses

2

Focus on markets with growth potential and sectors that have yet to
be developed

・Continue to focus on the automotive, life science and medical, and environment and energy sectors
・Launch new initiatives in the food business, including agriculture

3

Further enhancement of information infrastructure essential for global
management

・Prioritize infrastructure that is best for the entire Group・Enhance and standardize overseas business management

4

More proactive investment to expand the trading business・Make minority investments, primarily to expand the trading business・Consider majority investments, but with limited risk and scale

5

Continual review of assets and enhancement of financial standing

6

Establishment of global human resource management7 Progress in Year 3 of NC2020

8Operating Environments in Q2 FY03/20:
Information & Electronics (FPD Market)
 As TVs continued to grow larger, demand for larger LCD panel areas also grew.
 The effective embargo placed by the US on Huawei products has impacted theChinese market for small- and medium-sized LCD panels.
 Demand for organic electroluminescence displays (OLEDs) continued to grow,but the growth in panel area was limited.

Reference: Projected increase in
the area of FPDs
4%

5%

97.5%

97%

96%

95%

94％

2017

2018

2019

2020

2021

2.5%

Area

Reference: Projected increase in the area of large LCD panels
2017

YoY increase (%)

105％

2018
108％

2019
(forecast)

103％

6%

3%

LCDs

OLEDs

Note: Projected figures are provided for reference and represent company predictions based on various data

9

Operating Environments in Q2 FY03/20: Plastics
 Plastics prices trended downward due to dropping crude oil prices.
 The Chinese export business to North America was largely affected by trade friction
between the US and China. Japanese, Taiwanese and South Korean electronics
parts manufacturers were moving production to other Southeast Asian countries.
（ USD/barrel ）WTI crude oil prices, Domestic naphtha prices （ JPY/kl ）80

60,00053,50060
40,00040,20040
20,00020

00

WTI crude oil prices (USD)

Domestic naphtha prices (JPY)

Note: Q2 FY03/20 naphtha prices have been calculated using preliminary figures for July and August

10Progress of Year 3 of NC2020

 Profit figures were strong relevant to targets(Billions of yen)
2Q FY03/19
actual2Q FY03/20
actual

NC2020 target for
FY03/20(B)

FY03/20
Forecast(A)

Projected
achievement
versus targets(A)/(B)%

322.4

307.6

670.0

700.0

96%

Operating profit

7.1

7.1

14.5

14.5

100%

Ordinary profit

7.1

7.9

14.5

15.0

97%

Profitattributable toowners ofparent

6.2

6.7

11.0

11.0

100%

Net debt/equity
ratio

0.28

0.20

－

0.4x or less

Strong

44.5%

45.9%

－

－

－

USD1=¥110.26

USD1=¥108.60

USD1=¥110.00

USD1=¥110.00－

Net sales

Equity ratio
Exchange rate

Note: Net debt/equity ratio = (Interest-bearing debt − cash and deposits) / equity capital

11

NC2020 Progress by Segment: (1) Information & Electronics(Billions of yen)

NC2020(Billions of yen)

6.00

2Q FY03/20
actualOperatingprofit2.26

2.41

Operatingprofit margin

2.1％

Sales

107.8

Operating profit

4.81

4.40

4.20

(Target, Forecast)

4.00
2.26

2.41

2.00

0.00
FY03/19
2Q(Actual) FY03/20(Actual)

FY03/21(Goal)

FY03/20
forecast(A)

NC2020target for
FY03/20(B)

Projected
achievement
versus targets(A)/(B)%

4.20

4.20

100%

2.2％

1.8％

1.7％

―

110.4

232.0

250.0

93％

 Steady operating profit progress in terms of FY03/20 target
Strong performance in the liquid crystal business made up for reduced
profit in the European business caused by reorganizing.

Sales

300.0

261.0

250.0(Target)

217.9

Operatingprofit107.8

Main reasons for differences between actual and target figures

232.0 (Forcast)

200.0

100.0

2Q FY03/19
actual110.4• Increased sales of polarizing films in China (+)• Favorable sales of polarizing film materials (+)• Discontinuation of solar cell transactions at a European subsidiary (-)
FY03/19(Actual)2Q
FY03/20(Actual)

FY03/21(Goal)

Sales

0.0

12

NC2020 Progress by Segment: (2) Chemicals
NC2020(Billions of yen)(Billions of yen)
3.00

2Q FY03/19
actual2Q FY03/20
actualOperatingprofit

0.84

0.67

1.70

2.00

85％

Operatingprofit margin

2.2％

1.8％

2.1％

2.2％

―

Sales

39.2

36.7

81.8

91.7

89％

Operating profit

2.00 (Target)

2.00

1.42
1.00

0.84

FY03/20
forecast(A)

2.20

1.70 (Forcast)
0.67

NC2020target for
FY03/20(B)

Projected
achievement
versus targets(A)/(B)%

0.00
FY03/19(Actual)

120.0

2Q
FY03/20(Actual)

77.5

39.2

95.7

81.8 (Forcast)

36.7

2Q
FY03/20(Actual)

FY03/21(Goal)

Sales

0.0
FY03/19(Actual)Main reasons for differences between actual and target figures
Operatingprofit40.0

 Operating profit progress fell short of FY03/20 target
This was primarily caused by sluggishness in the recently integrated
former Housing & Eco Materials segment.

Sales

91.7 (Target)
80.0

FY03/21(Goal)••

Sluggish performance in the former Housing & Eco Materials
segment (-)
Impact of environmental regulations in China (-)
Growth in raw materials related to heat-dissipating materials (+)•••

Sluggish performance in the former Housing & Eco Materials segment(-)
Review of transactions at a European subsidiary (-)•

Note: In FY03/20, the Housing & Eco Materials segment was combined with the Chemicals segment.
Accordingly, FY03/19 results and FY03/21 targets incorporate figures from the Housing & Eco Materials segment

13

NC2020 Progress by Segment: (3) Life Industry
NC2020(Billions of yen)

2Q FY03/19
actual2Q FY03/20
actualOperatingprofit

0.58

0.60

1.80

2.50

72％

Operatingprofit margin

3.0％

3.3％

3.8％

4.2％

―

Sales

19.3

18.3

48.0

59.0

81％

(Billions of yen)
4.00

FY03/20
forecast(A)

Operating profit

2.80
2.50 (Target)
2.00

1.80 (Forcast)

1.31
0.58

0.60

FY03/19(Actual)2Q
FY03/20(Actual)

0.00

80.0

Sales

FY03/21(Goal)

65.0

Main reasons for differences between actual and target figures

19.3

Operating profit

48.0 (Forcast)

39.0

18.3

FY03/19(Actual)2Q
FY03/20(Actual)

FY03/21(Goal)

Sales

0.0

Projected
achievement
versus targets(A)/(B)% Operating profit progress fell short of FY03/20 target
Primary factors included upfront expenses for the food-related business,
which transferred sales rights to a subsidiary and delayed development of
new businesses.

59.0 (Target)

40.0

NC2020target for
FY03/20
(B)

•
•
•
•

Upfront expenses for new food-related business (-)
Impact from sales cycle of pharmaceutical ingredients (-)
Sluggish sales of raw ingredients for insecticides (-)
French pharmaceutical and cosmetics subsidiaries contributed toearnings (+)• Suspension of planned food business at a European subsidiary (-)• Delays in new food-related business (-)

14

NC2020 Progress by Segment: (4) Plastics
NC2020(Billions of yen)
8.00

6.34

3.34

2Q FY03/19
actual2Q FY03/20
actual

NC2020target for
FY03/20(B)

Projected
achievement
versus targets(A)/(B)%

Operatingprofit

3.34

3.36

6.70

5.60

120％

Operatingprofit margin

2.1％

2.4％

2.2％

1.9％

―

Sales

155.9

142.0

308.0

299.0

103％

6.70 (Forcast)
5.60 (Target)

4.00(Billions of yen)

Operating profit

FY03/20
forecast
(A)

5.90

3.36

0.00
FY03/19(Actual)2Q
FY03/20(Actual)

FY03/21(Goal)

Sales

400.0

300.0

308.0 (Forcast)

Operating profit

155.9

142.0

2Q
FY03/20(Actual)

FY03/21(Goal)

Sales

0.0
FY03/19(Actual)Main reasons for differences between actual and target figures

308.0

299.0 (Target)

200.0

 Strong operating profit progress in terms of FY03/20 target
Primarily due to improvement in profit margin caused by growth in sales ofhigh-performance plastics

•
•
•

•
•

Improved profit margin due to growth in sales of high-performanceplastics (+)
Indian subsidiary contributed to earnings (+)
Despite improvements, Mexican compound facility struggling on the
profit front (-)

Drop in plastics prices (-)
Impact of economic slowdown in China (-)

15

NC2020

FY03/20

Operating Profit Forecast We aim to achieve operating profit target as results in the Plastics segment cover for
below-target performance in the Chemicals (former Housing & Eco Materials) and Life
Industry segments(Billions of yen)

15.00

14.50

Other

0.10

▲0.1

14.50

+1.1

5.60

0.20

Plastics
Life Industry

6.70

10.00 Chemicals
Information▲0.7& Electronics

7.12
5.00

3.36

0.60
0.67
2.41

0.06

1.80

2.50

▲0.3

1.70*

2.00

4.20

4.20

FY03/20
forecast

FY03/20
target0.00
2Q FY03/20
actual* InFY03/20, the Housing & Eco Materials segment was combined with the Chemicals segment.

16

NC2020 Investment Status

More proactive investment to expand the trading business(Billions of yen)
FY03/19 actual

2Q FY03/20
actual

NC2020 period(FY03/18 onward)

Growth investment

2.31

0.44

6.62

Fixed investment

2.03

1.25

4.87

Total

4.34

1.69

11.49

 Major growth investments in 2Q FY03/20• Information & Electronics segment:¥0.05 billion in investment (related to bioequipment)• Plastics segment:¥0.12 billion for facilities (inflation-molding-related)¥0.10 billion for facilities (group companies)¥0.05 billion for facilities (compound-related)
17
Note: The growth investment figure for FY03/19 has been partially revised Returning Profits to Shareholders

18

Returning Profits to Shareholders

Policy on returning profits to shareholders
We target a total return ratio* of approx. 30–35%.
Dividends per share: FY03/20

interimyear-end¥20 (actual)¥28 (forecast)

Annual dividend: ¥48 (forecast)* Total return ratio (%) = (dividend amount + amount of treasury shares acquired) / consolidated net income x 100

19

Returning Profits to Shareholders

Annual dividends per share and indicators of shareholder return
(Yen)
50

Dividend

Dividend payout ratio

40

30

30

21

33

36

Total return ratio

40
34.8%

48

48

30.0%

Approx.
30–35%
target

40
46.5%

31.1%

31.1%

24.1%

23.7%

(604)

(707)

(891)

(679)

(936)

36.4%

23

20

25.6%

22.7%

26.4%

21.5%

22.1%

(355)

(439)

FY03/12

FY03/13

FY03/14

FY03/15

FY03/16

FY03/17

FY03/18

FY03/19

FY03/20(actual)(actual)(actual)(actual)(actual)(actual)(actual)(actual)(forecast)

21.9%

60.0%

40.0%

20.0%

10

0

0.0%

Note: The figures in parentheses at the bottom of the bar chart show the amount of treasury stock acquired (in millions of yen) during the period.

20 Reference Materials

21

Content of Reference Materials

Page
23
24
25
27
29
30
31
33
37
39
40
41
42
43

Positioning of NC2020, Our Medium-Term Management Plan
IK Vision 2030, Our Long-Term Vision
Operating Environment and Business Strategies under NC2020
Sales and Operating Profit by Segment under NC2020
Net Sales and Operating Profit
Overseas Sales and Operating Profit
NC2020 Differences by Segment in Year 3 Outlook and Targets
Focus on Markets with Growth Potential and Sectors That Have Yet to
Be Developed
Further Expansion and Deeper Involvement in Overseas Businesses
Reinforcement of Governance
Establishment of Global Human Resource Management
Earnings per Share
Annual Production Capacity for Plastic Compounds
Company Overview
22

(Reference) Positioning of NC2020,
Our Medium-Term Management PlanIK Vision 2030 was drawn up in May 2017, prior to NC2020.
MissionPeople come first, based on the spirit of "love ( ai )" and " respect ( kei )," andtogether we strive towards contributing to the development of society.

VisionTo continually evolve, serving clients and society, through global
operations and meeting their changing needs.

IK values

IK Values
Ethics, aspiration, organization, role, symbiosis

IK Vision 2030
IK Vision 2030 (envisioning ourselves 10 to 15 years in the future)

Medium-term management plan
NC2020 (targets for FY03/21)

23

(Reference) IK Vision 2030, Our Long-Term VisionInabata’s aspirations for itself in around 10–15 years (2025–2030)
Function: Further enhancing multifaceted capabilities (such as
manufacturing, logistics, and finance) in addition to trading

Scale:

Reach consolidated net sales of ¥1 trillion at an early stage

Overseas business: 70% or more
Portfolio: At least one-third of business from segments other thanInformation & Electronics and Plastics

Formulated May 201724

(Reference) Business Strategies under NC2020(1) Operating Environment
Segment

Operating environment

Information &Electronics• The liquid crystal business is poised to increase slightly in the medium term; panel display production
continues shifting to China.
• The photocopier and printer industries are mature, but room for growth exists with respect to industrial
applications.
• In solar power generation, expectations for Japan are low, but growth persists overseas.

Chemicals• The existing chemicals market in Japan has changed little, and the market for products handled by
Inabata is limited.
• Foreign chemical manufacturers are tending to have trading companies handle their marketing inJapan.

Life Industry• In pharmaceuticals, markets for new drugs and regenerative medicine have been growing at amoderate pace.
• In household products, the Japanese market is saturated while markets in emerging economies are
expanding.
• In food products, industrialized nations are becoming more health- and safety-conscious, while foodconsumption is increasing in emerging economies.

Plastics• Customers and suppliers are becoming increasingly international.
• Companies are opting to channel business to trading companies that can operate globally.

Housing &Eco Materials• The number of housing starts is expected to keep decreasing.
• The market for renovations is expanding.
• Increasingly, major homebuilders and housing equipment manufacturers are entering overseas
markets.

Formulated May 201725

(Reference) Business Strategies under NC2020(2) Portfolio Policy
Segment

Operating environment

Information &Electronics• We will work to maintain steady profits in the liquid crystal display business, which will remain amainstay business while the medium-term plan is in effect.
• We will work to expand new businesses, due to expectations of slowing growth in our current mainstay
businesses over the long term.

Chemicals• We aim to achieve deeper penetration in the automotive parts industry.
• We will expand the coating business with a focus on the automotive industry.
• We will enhance initiatives with foreign chemical manufacturers.

Life Industry• We will develop promising opportunities in the new drugs and raw materials businesses, and focus on
leading-edge medical fields.
• In household and food products, we will work to increase sales, driven by overseas and otherexpanding markets.
• In food products, we will continue expanding into the production and processing businesses.

Plastics• We aim to expand sales of plastics, leveraging the plastic compounds business.
• We will focus on the automotive sector, particularly the North American market.

Housing &Eco Materials• We will expand our sales to overseas markets.
• We will focus on non-housing fields of business.

Formulated May 201726

(Reference) Sales by Segment under NC2020(Billions of yen)

Information & Electronics

ChemicalsLife Industry

Plastics

1,200

Housing & Eco Materials

Other

IK Vision 2030

(IK Vision 2030)

1,000.0

1,000

New Challenge 2016

NC2020

800

600

400

200

730.0

0.3
670.0
634.7
621.1
0.2
586.6
577.0
572.1
0.1 24.1 0.1
25.1
0.1
308.0
24.2 0.5 24.8 0.1 25.0
308.0
300.0
286.9
251.8
251.1
250.4
65.0
48.0
95.7
39.0
40.4
42.3
41.0
34.6
81.8
48.0
53.4
51.5
52.8
48.1

209.3

211.6

221.0

214.9

217.9

232.0

261.0

FY03/15

FY03/16

FY03/17

FY03/18

FY03/19

FY03/20

FY03/21(actual)(actual)(actual)(actual)(actual)(forecast) (medium-term target) (around 2025–2030)

0Note: In FY03/20, the Housing & Eco Materials segment was combined with the Chemicals segment.

Future27

(Reference) Operating Profit by Segment under NC2020(Billions of yen)

Information & Electronics

ChemicalsLife Industry

Plastics

Housing & Eco Materials

Other

27.5

230～240

IK Vision 2030

(IK Vision 2030)
22.5

New Challenge 2016

NC2020

17.5

14.0
14.5
0.10
0.10
0.04

12.6

12.5

7.5

2.5

-2.5

Operatingprofitmargin

0.14
11.3
10.7
0.26
0.14
6.34
0.28 0.15 0.42
5.9
5.39
4.43
3.73
0.12
0.15
1.31
1.03
1.82
1.52
1.37
1.07
5.54
1.00
1.01

15.5

0.20

5.90
6.70
2.80
1.80
1.70

2.20

4.81

4.20

4.40
FY03/21

4.48

3.83

3.99

FY03/15

FY03/16

FY03/17

FY03/18

FY03/19

FY03/20(actual)(actual)(actual)(actual)(actual)(forecast) (medium-term target) (around 2025–2030)

1.9%

2.0%

2.2%

1. 0%

2.2%

1.92
0.25 (2.04)

2.2%

Future2.1%

Note: In FY03/20, the Housing & Eco Materials segment was combined with the Chemicals segment.

28

(Reference) Net Sales and Operating Profit(Operating profit: Billions of yen)

(Net sales: Billions of yen)

1,200

35
(IK Vision 2030)
1,000.0 30

1,000

Net sales

Operating profit(Mediumterm target)

800

25

730.0

634.7
621.1

600
500.0
442.7

469.0

479.9

400
7.6

7.9

15.5

572.1

15

14.0 14.5

11.3

10.9
288.9

20

577.0 586.6

561.1
466.0

670.0

12.6

10

10.7

7.6

7.7
7.6

200

5

5.9

2.6

3.5

0

0

NC2020(Around 2025–2030)

29

(Reference) Overseas Sales and Operating Profit(Net sales: Billions of yen)

(Operating profit: Billions of yen)

18

750

Net sales

Operating profit(IK Vision 2030)

14
500

10
7.3
6.1

250

3.3
1.2

72.4

1.6

3.6

4.2

3.5

2.3

4.9
3.7

312.9 327.7

1.6 2.0

110.2

150.5

170.9

185.0

159.3

152.2

6

3.9

340.6

305.4
284.3

84.1

5.8

5.1

186.5

186.7

2

294.0

211.6

(0.7)

-2

0

JPY per USD

119.9(Around 2025–2030)
107.1

104.2

118.0

119.1

114.1

91.0

92.1

81.4

77.7

79.8

100.1

109.7

120.1 108.3

110.8

110.9

NC202030

NC2020 Differences by Segment in Year 3 Outlook and Targets

Net sales
Information & Electronics
Life Industry(Billions of yen)

700

634.7

Chemicals
Plastics

670.0
0.1

Housing & Eco Materials
Other 700.0

0.3

0.2

600
500

308.0

300.0

400
300

77.5

299.0

81.8 *

59.0
32.7
59.0

217.9

232.0

250.0

FY03/19
actualFY03/20
forecast

FY03/20
target underNC2020

39.0
24.1
53.4

48.0
Combination with Chemicals

91.7

200

100
0

* In FY03/20, the Housing & Eco Materials segment was combined with the Chemicals segment. In FY03/20,
performance in the Chemicals segment comprises ¥56.8 billion from the former Chemicals segment and¥25.0 billion from the former Housing & Eco Materials segment.

31

NC2020 Differences by Segment in Year 3 Outlook and Targets

Operating profit(Billions of yen)

Information & Electronics
Life Industry
15.0

14.03

10.0

1.42
5.0

Chemicals
Plastics

Housing & Eco Materials
Other

14.50
0.10

0.13

6.34

6.70

1.31
0.04
1.37

1.80

1.70

14.50

0.20

5.60

2.50
0.50
1.50

*

2.00

Suspension of European
solar cell transactions (-)
LCD-related growth (+)

4.81

4.20

FY03/19
actualFY03/20
forecast

4.20

0.0
FY03/20
target under* In FY03/20, the Housing & Eco Materials segment was combined with the Chemicals segment. In FY03/20, the former NC2020
Chemicals business accounts for ¥1.55 billion and the former Housing & Eco Materials segment for ¥0.15 billion.

32

【重点施策
Focus
on markets
with growth
sectors and(Reference)
Focus
on Markets
withpotential
Growthand
Potentialthat have yet to be developed】

Sectors That Have Yet to Be Developed

Principal initiatives in the automotive field
Plastics:

We are working to increase sales of plastics to global customers, and are also expanding incountry sales.
Sales to Japanese automobile parts manufacturers were strong, despite sluggishness in the
Chinese market
Chemicals: We are expanding sales of parts and paint materials, and are focusing on sales of heat-dissipating
materials and parts.
Information & Electronics: Potential exists to sell decorative films.
(Billions of yen)

100.0

Sales from principal business in the automotive field (simple totals)

75.0

14.7
11.5
Chemicals, Other

10.5

50.0

Plastics

8.5
6.0
25.0

46.5

54.0

36.0

63.3

29.2

0.0
FY03/17(actual)

FY03/18(actual)

FY03/19(actual)2Q FY03/20(actual)

FY03/21(medium-term target)

Notes: Results for past fiscal years include certain amounts that have been updated.
Figures from FY03/20 have been adjusted from initial forecasts, taking the most recent conditions into consideration.

33

【重点施策
Focus
on markets
with growth
sectors and(Reference)
Focus
on Markets
withpotential
Growthand
Potentialthat have yet to be developed】

Sectors That Have Yet to Be Developed

Principal initiatives in the environment and energy fields
Information & Electronics: We are focusing on high value-added material and system sales as performancein solar sells drops sharply due to the suspension of business at our European
subsidiary
Sales of lithium-ion battery materials to manufacturers in South Korea are
increasing
Chemicals: We will focus on sales of wood chips and particle board.

Sales from principal business in theenvironment and energy fields (simple totals)(Billions of yen)

20.0

2.3
2.6
10.0

2.3

Chemicals
Information & Electronics

13.2
2.0
8.0

10.1
1.0

4.5

3.5

0.0
FY03/17(actual)

FY03/18(actual)

FY03/19(actual)2Q FY03/20(actual)

FY03/21(medium-term target)

Notes: Results for past fiscal years include certain amounts that have been updated.
Figures from FY03/20 have been adjusted from initial forecasts, taking the most recent conditions into consideration.

34

【重点施策
Focus
on markets
with growth
sectors and(Reference)
Focus
on Markets
withpotential
Growthand
Potentialthat have yet to be developed】

Sectors That Have Yet to Be Developed

Principal initiatives in the life science and medical fields
Life Industry: Despite growth in sales of pharmaceutical ingredients (APIs and intermediates), we faced
unstable supply caused by environmental issues in China and lagging sales in the field ofadvanced medicine
In household products, we are concentrating on overseas sales of Japanese-made products.
Plastics:
We aim to sell plastics to medical device manufacturers (for use in syringes and otherproducts).
(Billions of yen)

Sales from principal business in the life scienceand medical fields (simple totals)

50.0

2.8
25.0

2.1

2.1
Plastics, Other

2.4

Life Industry
25.7

28.3

31.2
23.1

1.2
10.7

0.0
FY03/17(actual)

FY03/18(actual)

FY03/19(actual)2Q FY03/20(actual)

FY03/21(medium-term target)

Notes: Results for past fiscal years include certain amounts that have been updated.
Figures from FY03/20 have been adjusted from initial forecasts, taking the most recent conditions into consideration.

35

【重点施策
Focus
on markets
with growth
sectors and(Reference)
Focus
on Markets
withpotential
Growthand
Potentialthat have yet to be developed】

Sectors That Have Yet to Be Developed

Principal initiatives in the agricultural field
Life Industry: We are promoting the crop cultivation business in Hokkaido, centering on blueberries andgarlic. Initial shipments of blueberries were small but were praised for their high quality.
Plastics:
We are concentrating on sales of films for agricultural use (for anti-fogging, for example).
Information & Electronics: Sales of animal feed (imported grass) are increasing.
(Billions of yen)

6.0

Sales from principal business in the agricultural field (simple totals)

4.0
Plastics, OtherLife Industry
3.5

2.0

0.0

2.1

2.1

0.2

0.3

FY03/17

FY03/18(actual)(actual)

2.5

0.0

0.8
0.0

0.4

FY03/192Q FY03/20

FY03/21(actual)(actual)(medium-term target)

Notes: Results for past fiscal years include certain amounts that have been updated. Figures indicated above exclude sales of refrigerated andfrozen products. Figures from FY03/20 have been adjusted from initial forecasts, taking the most recent conditions into consideration.

36

(Reference) Further Expansion and Deeper Involvement inOverseas Businesses
Progress at our compounds plant(sales to automakers in Mexico)
Performance in Q2 FY03/20 fell below forecast as new model production at
Japanese automobile manufacturers entered an adjustment phase. Results
are expected to recover in 2H.

FY03/192Q FY03/20
FY03/20

Sales of 6,700 tonnes
Sales of 4,300 tonnes
Forecast sales of 9,600 tonnes

Company: IK Plastic Compound Mexico, S.A. de C.V.
Production capacity: 15,000 tonnes/year
Location: Silao, Guanajuato, central Mexico
Commenced operations in November 2013, with mass
production starting in September 2014
37

(Reference) Further Expansion and Deeper Involvement inOverseas Businesses
Progress at our compounds plant(sales to manufacturers of OA equipment in the Philippines)
Growth in Q2 FY03/20 sales was lower than expected due to sluggish
production at major customers.
The business for two-wheeled vehicles is set to launch in 2H.

FY03/192Q FY03/20
FY03/20

Sales of 10,200 tonnes
Sales of 4,600 tonnes
Forecast sales of 9,600 tonnes

Company: IK PLASTIC COMPOUND PHILS. INC.
Production capacity: 10,800 tonnes/year
Location: Laguna Province, Philippines
Commenced business and production in July 201438

(Reference) Reinforcement of Governance

Board of Directors evaluation
Objective: To enhance corporate value by increasing the effectiveness andtransparency of the Board of Directors
FY03/18
Conducted third-party evaluation⇒ In May 2018, disclosed summary of evaluation and measures going forward
FY03/19
Performed a self-evaluation of all directors and Audit & Supervisory Board
members using a survey format⇒ In April 2019, disclosed summary of evaluation and measures going forward

FY03/20
Plan to perform a self-evaluation of all directors and Audit & Supervisory Board
members using a survey format
39

(Reference) Establishment of Global
Human Resource Management

Expanding human resources and accelerating training efforts toenhance quality✓ We conducted workshops at 4 locations in 3 countries to promote “IK Values.”
Launched in 2018, we hold these workshops at 36 locations in 14 countries overseas✓ We continued to hold the Global Staff Meeting.
The meeting was held in Tokyo in May 2019 (attended by 13 local staff members and fourJapanese staff members).
Number of overseas personnel in the trading division and(People) people on overseas assignment
1,000
Trading division
People on overseas assignment

628

663

693

737

764

773

500

90
0

93

95

94

90

90
Global Staff Meeting participants and executives from theHead Office

Note: The number of people on overseas assignment is as of the first day of the following month.

40

(Reference) Earnings per Share

(Yen)
240

211.36200

181.83160

151.91137.01120

97.45

156.25137.20109.92104.29

80

40

0

(355)

(439)

FY03/12

FY03/13（actual）（actual）

(604)

(707)

FY03/14

FY03/15

FY03/16（actual）（actual）（actual）

(891)

(679)

(936)

FY03/17

FY03/18（actual）（actual）

FY03/19

FY03/20（actual）（forecast）

Note: Figures in parentheses at the bottom of the bar graph indicate own-share purchases conducted during
the year (in millions of yen).

41

(Reference) Annual Production Capacity for Plastic Compounds
China
Plastics Compound
Business Office (Japan)(2 sites)
52,200 MT/Y•••

VietnamShares information
Coordinates facilities andraw materials
Reduces costs bypurchasing in bulk

42,000 MT/Y

ThailandPhilippines

38,400 MT/Y

10,800 MT/Y
Building and dismantling plants in line with customers’
relocation strategies
Providing consistent service quality everywhere

Malaysia
27,600 MT/Y

Indonesia
37,200 MT/Y

223,200 MT/Y: 8 sites in 7 countries (As of October 31, 2019)

Mexico15,000 MT/Y42

(Reference) Company Overview
Name

Inabata & Co., Ltd.

Founded

October 1, 1890

Incorporated

June 10, 1918

Capital stock¥9,364 million

Representative

Head offices

Employees

Katsutaro Inabata, president andCEOOsaka Head Office (1-15-14
Minami-semba, Chuo-ku, Osaka)
Tokyo Head Office (2-8-2
Nihonbashi-honcho, Chuo-ku,
Tokyo)
644 (4,263 on consolidated basis)

Issuable shares

200,000,000

Shares issued
and outstanding

63,499,227

Fiscal year

April 1 to March 31

Exchange listing

Tokyo Stock Exchange

Ticker

8098

Trading unit

100 shares

Shareholders
19,206

Major
shareholders(top three andpercentage
ownership)

Sumitomo Chemical Co., Ltd.
(22.8%)The Master Trust Bank of Japan,
Ltd. (Trust Account) (3.6%)
Japan Trustee Services Bank,
Ltd. (Trust Account) (3.4%)

The Company owns 2,710,182 shares of treasury stock. This
shareholding has not been included in the calculation of theshareholding ratio. However, 100,000 shares of the Company
held by Trust & Custody Services Bank, Ltd. (Trust account E) asa trust property under the Board Benefit Trust (BBT) system is
excluded from the number of the treasury shares, and hence, is
included in the calculation of the ratio.

(As of September 30, 2019)43

 IR-related inquiries:

IR Department, Financial Management Office
Inabata & Co., Ltd.
Phone: +81-50-3684-4007 Fax: +81-3-3639-6410
E-mail: inabata-ir@inabata.com

Cautionary note regarding forward-looking statements
The data and future predictions contained in this document are forward-looking statements, based on
information available and judgments applicable at the time of the document’s release. The data andforecasts contained herein may include elements that are subject to change. This document and its
contents are no guarantee of future performance.
Presentation of numerical figures
Figures in this document presented in millions and billions of yen have been rounded down.
Consequently, certain discrepancies may exist between individual values and total values, or values
showing changes between sets of data.

44