Annual Report

2012

Providing affluence and comfort to people andsociety, with our unique technology

Profile
Nippon Shokubai Co., Ltd. was founded in 1941. In the ensuing 71 years,
the Company has built a solid operational foundation by developing
products using original technologies and creating distinctive manufacturing
technologies. Throughout our history, we have adhered to our corporate
philosophy of “TechnoAmenity,” which means using technology to provide
affluence and comfort to people and society.
We have a four-part management philosophy as follows: (1) We willconduct all of our corporate activities based upon a deep respect forhumanity; (2) We will aim to coexist with society and work in harmony
with the environment; (3) We will pursue innovative technologies; and(4) We will operate on the global stage.
Under our management philosophy, we have built three main businesssegments: Basic Chemicals, including acrylic acids and ethylene oxide;
Functional Chemicals, such as superabsorbent polymers and polymer forconcrete admixture; and Environment & Catalysts, including automotive
catalysts and fuel cell materials. The Company holds the top world market
share for superabsorbent polymers.
The aforementioned three segments are spearheaded by five corporate
divisions: Ethylene Oxide Business, Acrylic Business, Fine & Performance
Chemicals Business, Electronic & Information Materials Business, andCatalyst & Green Energy Materials Business.
The Nippon Shokubai Group is currently implementing a long-termbusiness plan entitled “TechnoAmenity 2015,” which began in fiscal 2010.
The plan embodies our vision for 2025 of becoming “a chemical company
providing new value through innovative technologies.” Under the plan, allGroup employees stand united in their commitment to benefit society
through renewed business advancement and appealing products andinitiatives.

Contents
Financial Highlights
To Our  Shareholders
Review of Operations
Governance System
Financial Position
Consolidated Financial Statements
Consolidated Balance Sheets
Consolidated Statements of Income
Consolidated Statements of Comprehensive Income
Consolidated Statements of Changes in Net Assets
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
Independent Auditor’s Report
Corporate Data

01
02
06
08
10
11
12
14
15
16
19
21
43
44

Financial Highlights
Nippon Shokubai Co., Ltd. and Consolidated Subsidiaries

					
				
Millions of Yen

Millions of
U.S. Dollars

2011

2012

2012

Net Sales............................................................................................................ ¥288,345¥320,704$3,901For the Years Ended March 31,		
Operating Income..............................................................................................

29,813

31,100378

Net Income........................................................................................................

21,11921,257258

Total Assets........................................................................................................ ¥329,332¥356,407$4,336

Total Net Assets..................................................................................................

194,266

209,070

2,543

Cash and Cash Equivalents.................................................................................

39,17450,812618

At the Year End

			

Yen

U.S. Dollar

Per Share Amounts¥ 104.71

Net Income........................................................................................................ ¥ 110.30$ 1.27

Cash Dividends...................................................................................................

22.00

22.00

0.27

Net Assets..........................................................................................................

938.67

1,006.48

12.25

Foreign Exchange Rate : U.S. $1.00 =¥82.19

Net Sales

Total Net Assets

Operating Income
ROA(Billions of Yen)

(Billions of Yen)

(Billions of Yen, %)

400

300

40

302

12

288

209

29.8 31.1
9.7
9.7

320
289

240

30

194
9

180

175
163
151

244

13.8

200

20

18.3
6.1

6

120

3

60

0

0

4.9

100

10

0.6
0

‘08

‘09

‘10

‘11

‘12

0

‘08

0.2
‘09
‘10

‘11

‘12

‘08

‘09

‘10

‘11

‘12

Operating Income
ROA

Annual Report 2012 Nippon Shokubai Co., Ltd.

01

To Our Shareholders

Business Environment and Performance
In fiscal 2011, ended March 31, 2012, the Nippon Shokubai Group posted record-highresults that significantly exceeded its projections made at the end of the previous fiscal
year. We would like to this opportunity to thank customers, employees, shareholders,and all other stakeholders for their valuable support.
In the year under review, the Japanese economy faced difficult challenges. In
addition to historically high yen values, these included the European sovereign debt crisisand concerns about global economic slowdown, including among emerging nations,as well as the impacts of the Great East Japan Earthquake of March 2011 and serious
flooding in Thailand. Although there were signs during the period of moderate recovery
in corporate production activities and personal consumption, the economic outlook
remained cloudy in the wake of the strong yen and soaring raw materials prices.
Despite such challenges, the Group enjoyed firm demand from the manufacturingsector for some of its products. Consolidated net sales for the year amounted to
Masanori Ikeda
President¥320,704 million, up 11.2% from the previous year. During the year, we strengthened
our production capacity for superabsorbent polymers, which led to increases in
expenditures and fixed costs. Nevertheless, this was outweighed by increases in sales
volumes, as well as enhanced profitability for some products. Accordingly, operating
income rose 4.3%, to ¥31,100 million, and net income was up 0.7%, to ¥21,257 million.

Management Philosophy; Medium- and Long-Term Business Plans
Since its foundation in 1941, the Group has been achieved self-sustaining growth
based on a commitment to using original technologies to develop products andbuild manufacturing plants. To this end, demonstrating our responsibilities as achemicals manufacturer, we have cited “Safety takes precedence over production” as
our company motto. By always placing top priority on safe operating practices, weachieved a “zero accident” outcome in fiscal 2011.
In order to benefit society while generating long-term growth, we have amanagement philosophy and medium- and long-term business plans that areembraced by all employees, who are devoted to their business activities.

Corporate Philosophy and Management Philosophy
The Nippon Shokubai Group has a corporate philosophy of “TechnoAmenity,” whichmeans using technology to provide affluence and comfort to people and society. To
realized this philosophy, we also have a four-part management philosophy as follows:> We will conduct all of our corporate activities based upon a deep respect for 		
humanity.
> We will aim to coexist with society and work in harmony with the environment.
> We will pursue innovative technologies.
> We will operate on the global stage.

02

Nippon Shokubai Co., Ltd. Annual Report 2012

To Our Shareholders

Guided by the above philosophy, we will build a corporate foundation capable ofaddressing future global changes. At the same time, we will work to strengthen ourinternational competitiveness and implement our medium- and long-term business plans.

Medium- and Long-Term Business Plans: Basic Policies
The Nippon Shokubai Group is targeting renewed growth and expansion of its incomebase through the implementation of its long-term business plan, “TechnoAmenity
2015” (April 2010 to March 2016), and its accompanying medium-term action plan
(April 2010 to March 2013).
Our vision for 2025 is to become “a chemical company providing new value
through innovative technologies.” To this end, we are building a new business structure
and are focusing on the following four business initiatives for achievement by 2015:> Boost profitability of existing businesses, such as ethylene oxide and acrylic acid
> Create a new business in the health and medical materials field> Grow the new electronic & information materials business into an earnings pillar> Develop the new energy materials business into a core next-generation businessOur consolidated performance targets for fiscal 2015 (ending March 2016) under“TechnoAmenity 2015” are net sales of ¥400 billion and operating income of ¥30
billion. The plan also places particular emphasis on profitability, with a return on assets(ROA) target of 7.5%. Under the medium-term action plan, our consolidated targets
for fiscal 2012 (ending March 2013) are net sales of ¥330 billion, operating income of¥22 billion, and ROA of 6.3%.

Medium-Term Business Plan: Progress Status
Further strengthening existing businesses
In the superabsorbent polymers business, in June 2012 we upgraded our plant in the
United States, which has a capacity of 60,000 tons/year, and in August 2013 we will
launch operations at a plant in Indonesia, with a capacity of 90,000 tons/year. In July
2014, we also plan to expand our plant in China, which has a capacity of 30,000 tons/
year. Through these scrap-and-build projects, we will increase our total production
capacity for superabsorbent polymers from 470,000 tons/year (as of March 2012) to590,000 tons/year by 2014. In the process, we will further solidify our position as theworld’s top supplier of superabsorbent polymers.
In the acrylic acid business, we plan to bolster our production capacity in Indonesia
to 80,000 tons/year and at the Himeji Plant to 80,000 tons/year by August 2013. This
will raise the Group’s production capacity for acrylic acid to 780,000 tons/year.
Regarding ethylene oxide and derivatives, the Group expanded the production
capacity for polymer for concrete admixture at its Kawasaki Plant in April 2012. We
also plan to increase the production capacity for (meth) acrylic acid special ester at theAnnual Report 2012 Nippon Shokubai Co., Ltd.

03

same plant in 2013. Including the expansion of these derivatives, the Group aims toshift to non-EG (ethylene glycol) to establish an earnings foundation resistant to trends
in market prices.
The Group’s “Earnings Improvement Committee,” whose mission is to improve theprofitability of existing businesses, will review all processes—from raw materials
procurement to manufacturing, inventory, and supplies to customers—regarding
ethylene oxide and derivatives, acrylic acid and derivatives, and superabsorbent
polymers. In these ways, we will cut costs while rigorously controlling profits margins
by product and customer.

Fostering new businesses
In the electronic and information materials business, the Group is targeting sales of¥30 billion in fiscal 2015, ending March 2016. To this end, we will seek to improve
profitability by further boosting sales and raising capacity utilization, centering on
optical acrylic materials.
In the new energy business, we are targeting sales of ¥5.0 billion in fiscal 2015.
Here, we will expand facilities and boost sales, with particular emphasis on fuel cellmaterials. In addition, we will continue working to foster next-generation businesses,
including by commercializing lithium-ion battery materials.

Re-energizing human resources and the organization
Going forward, the Group plans to bolster training programs for different employee
levels, while promoting the widespread understanding of its corporate andmanagement philosophies and implementing various measures to strengthen corporate
governance. In these ways, we will strive to re-energize our human resources andorganization in order to achieve the fiscal 2015 targets of our long-term business plan,“TechnoAmenity 2015.”
The Group also intends to position corporate social responsibility (CSR) as a coremanagement priority. Here, we will engage in corporate activities based on complianceand self-responsibility and adopt a rigorous approach to corporate ethics. At the sametime, we will pursue responsible care activities covering the environment, safety,
and quality, while promoting environmental protection and other social contribution
initiatives.

OutlookIn fiscal 2012, ending March 2013, we have seen a recovery in corporate production
activities in Japan. However, there are concerns about protraction of economic
recession and delayed restoration of damage caused by the Great East Japan
Earthquake. Overseas, we expect conditions to remain unclear, characterized bysluggish consumption caused by the European debt crisis, as well as the potential forvolatile foreign exchange movements.

04

Nippon Shokubai Co., Ltd. Annual Report 2012

To Our Shareholders

In the chemicals industry, there are concerns about geopolitical risk in Iran andelsewhere, as well as the possible impact that excess liquidity, stemming from global
financial liberalization measures, may have on prices of crude oil and other resources
and foreign exchange rates. There are also concerns about restrictions on power
consumption associated with the closure of nuclear power generation plants.
Under these circumstances, we have formulated production and sales plans basedon the following assumptions: exchange rate of ¥80.00 per U.S. dollar and ¥100.00
per euro, as well as a naphtha price of ¥60,000 per kiloliter. In addition, we forecast ayear-on-year increase in sales volumes, especially for functional chemicals. We will also
make upward revisions to selling prices in line with rising prices of raw materials. By
contrast, we are concerned about softening of market conditions for our products andincreasing prices of raw materials.
For fiscal 2012, we forecast consolidated net sales of ¥330.0 billion, up 2.9% fromfiscal 2011. Despite expectations of an increase in sales volumes in the second half ofthe year, we forecast a 19.6% decline in operating income, to ¥25.0 billion. This is dueto the significant impacts of declining international market prices of basic chemical
products and contracting profit margins stemming from rising prices of raw materials.
Our forecast for net income is ¥19.5 billion, down 8.3%.

Profit Appropriation Policy
Returning profits to shareholders is an important management priority. Our basic
policy is to make consistent dividend payments over the medium and long terms
based on comprehensive consideration of various factors, such as the need to expand
our business and strengthen our financial base. At the same time, we will continue
conducting share buybacks and working in other ways to increase our share price.
In order to underpin our international competitiveness and deliver continuous
growth, we need to make active investments in capital equipment and research anddevelopment. We also recognize the importance of bolstering retained earnings toenable such investments, and will carefully consider the most appropriate balance ofdividend payments and retained earnings accordingly.
Going forward, we will return profits to all shareholders while ensuring soundand robust advancement of our operations. We look forward to your ongoingunderstanding and cooperation in these endeavors.

Masanori Ikeda
President

Annual Report 2012 Nippon Shokubai Co., Ltd.

05

Review of Operations
In the year under review, the Basic Chemicals segment posted sales of ¥136,562
million, accounting for 42.6% of consolidated net sales. Segment operating
income amounted to ¥13,387 million, or 43.1% of consolidated operating
income. The Functional Chemicals segment reported sales of ¥160,762 million,or 50.1% of net sales, and operating income of ¥16,526 million, or 53.1% of
total operating income. The Environment & Catalysts segment recorded sales of¥23,380 million, or 7.3% of net sales, and operating income of ¥1,671 million, or
5.4% of total operating income.

Description of Business
Ethylene Oxide
Business Division

Basic
Chemicals

Functional
Chemicals•Ethylene oxide (EO)
•Ethylene glycol•Ethanolamine•Higher alcohols•Acrylic acid
•Acrylates•Polymers forconcrete admixture•Water-soluble
polymers•Superabsorbent
Polymers•Specialty acrylates•Specialty
methacrylates

Environment&
Catalysts

06

Acrylic Business
Division

Nippon Shokubai Co., Ltd. Annual Report 2012

Fine & Performance
Chemicals
Business Division•Maleic anhydride &Derivatives•Polyethyleneimine•Intermediates forpharmaceuticals•Resins for paints &adhesives

E&I Materials
Business Division

Catalysts & Green
Energy Materials
Division•Acrylic resin for
optical materials•Spherical fineparticles•Functional dye•Zirconia sheets & cells•Automotive catalysts•Process catalysts•De-Nox & dioxins
decomposition
catalysts

Review of Operations

Basic Chemicals
Sales of acrylic acids and acrylates remained mostly unchanged year-on-year in volume
terms. However, sales in value terms increased significantly on the back of surging
market prices stemming from global demand pressures, as well as rising export prices.
Firm demand led to higher year-on-year sales volume of ethylene oxide, and sales invalue terms also increased thanks to price hikes in response to rising prices of raw
materials. The Company reported year-on-year growth in sales of ethylene glycol owing
to higher sales volume, driven by exports, amid high market prices. Despite a decline
in sales volumes of export products, we posted an increase in sales of higher alcohols,
having revised selling prices upwards to reflect high raw materials prices. We also raised
selling prices of ethanolamine in response to high raw materials prices, but sales of thisproduct declined year-on-year in both volume and value terms.
As a result, sales of the Basic Chemicals segment increased 9.2%, to ¥136,562
million. However, segment operating income declined 4.3%, to ¥13,387 million, due
to an increase in fixed costs to reflect reinforcement of the Company’s production
capacity, as well as higher selling, general and administrative (SG&A) expenses. Thiswas despite the benefits of increased production, growth in sales, and strong market
conditions for our products.

Functional Chemicals
We reported a significant year-on-year increase in volume sales of superabsorbent
polymers, thanks to bolstering of production capacity amid healthy demand. Sales ofraw materials for detergents, maleic anhydride, resin modifiers and resins for paints
increased on the back of higher sales volumes. However, sales of polymer for concrete
admixture and electronic and information materials decreased due to a decline in sales
volumes. Despite a decrease in sales volumes, sales of specialty acrylates and iodine
compounds increased due to upward revisions to selling prices.
Effective the year under review, Nippon Polymer Industries Co., Ltd., a producer ofacrylic resins, became a consolidated subsidiary, thus providing a boost to segment sales.
As a result, sales of the Functional Chemicals segment rose 13.6%, to ¥160,762
million. Despite the effects of the strong yen and high raw materials prices, segment
operating income climbed 24.0%, to ¥16,526 million, owing to expansion of
production and sales volumes, we well as efforts to revise selling prices upwards.

Environment & Catalysts
Sales of automotive catalysts and process catalysts increased year-on-year, owing to arise in sales volumes and an upward revisions to selling prices. Sales of wet oxidation
catalysts and fuel cell materials were down due to declines in sales volumes.
As a result, sales of the Environment & Catalysts segment increased 7.5%, to¥23,380 million. Despite a rise in sales of process catalysts, segment operating
income fell 29.4%, to ¥1,671 million, partly due to the absence of a valuation gain on
inventories posted in the previous fiscal year.

Annual Report 2012 Nippon Shokubai Co., Ltd.

07

Governance System

We are working to improve our

The Board, comprised of 9 members of

For the purpose of further speeding

corporate culture and strengthen our

the board Including one from outside

decision-making involving managementcompetitiveness in order to respond toas of June 22, 2010, deliberates andand reinforcing the management

global trends. Our approach to corporate

resolves the matter relating to thesupervisory role of the Board, thegovernance therefore establishes our

execution of business operations, andCompany started to utilize the corporate

foundation. Using the system illustrated

supervises the execution of operation

officer system from June 22, 2010. Thisin the following diagram, we are taking

that the Board decided. In principal,

system separates the role of reachingsteps to revitalize our board of directors,

the Board convenes once a month,decisions involving management andstrengthen our audit system, improve thechaired by the president, at which four

supervising management, and the roleefficiency of our management structure,corporate auditors, including two fromof executing business operations. The

and improve and strengthen ouroutside, are in attendance. The corporate

number of corporate officers is 16 (7compliance system.

auditors present statement when deemedof those who serve as the director

necessary.

concurrently).

Our Corporate Governance System(as of April 1, 2011)
General Meeting of Shareholders

Board of Directors
Board of Auditors

Audit

President
Corporate Managing
Committee

Reports

Risk Management
Committee
Accounting
Auditors

CSR Management
Committee
Audit

Collaborates
ProvidesSupportCollaborates

RC Promotion
Committee

Legal
Advisors

Compliance
Committee

Consultation

Internal Control
Committee

Auditors Office

Executive Officers

Internal
Audit
OfficeInternal
Audit

Corporate
Planning

GeneralAdministration& Personnel

Purchasing &Logistics

08

Nippon Shokubai Co., Ltd. Annual Report 2012

Finance &Accounting

Informational
Technology
Management
OfficeResearch
Planning &Development

Responsible
Care

Investor &Public Relations

Sales

Production

Governance System

Corporate Management Committee,

CSR(Corporate Social Responsibility)

and Exchange Law as of April 1st 2008,

as an advisory organ to the president,

Management Committee, chaired by

not only aim to ensure the reliability ofdeliberates basic management policies,

the president, discusses and decides

the company’s financial reporting, but

the matters related to the execution of

the CSR policy and activities that would

also to ensure the effectiveness andimportant business operations. Agenda

make all the stakeholders beneficial, in

efficiency of the company’s business

items that come up to this Committee

cooperation with the other committees

activities.

and are regarded as important will besuch as Risk Management Committee or

forwarded to the Board for deliberation.

the Compliance Committee.

The members of the Corporate

Legal Advisers provide their opinions
for us when solicited. None of the Legal

Management Committee are the

Responsible Care Promoting

Advisors is involved in the management

president and corporate officers

Committee, chaired by the president,of the Company.

nominated by the president. In principal,

discusses and decides the policy andthe Committee convenes twice a month.

plans of activities for “Responsible

Accounting Auditors perform theirCare(RC)” placing a special emphasis onservices under the Commercial Code and

Board of Corporate Auditors isenvironmental preservation, safety andSecurities and Exchange Law of Japan,

comprised of four corporate auditors,

quality throughout the entire life cycle ofand provide their opinions when we callincluding two from outside. In principle,

our products from the development tofor it to make decisions on accounting

the Board convenes once a month todisposal. The Committee established theissues. None of the Accounting Auditors

report, discuss and resolve important“7th (for FY 2010 to 2012) Medium-term

is involved in the management of thematters. In addition to attending the

RC Promotion Basic Plan” to reinforce ourCompany.

Board of Directors, the corporate auditors

RC more active. Moreover, Responsible

attend the Corporate Management

Care Office implements plans and internalInternal Audit Office carries out

Committee and other important meetings

audits on responsible care activities ininternal audits (verify the adequacy andto monitor the decision making process,each division.

effectiveness of the business process inand grasp the execution of corporateeach division and report the results to theofficers’ operation, receive reports from

Compliance Committee, chaired bydirectors) in cooperation with the Board

the accounting auditors, corporate

the president, discusses and decidesof Corporate Auditors and Accounting

officers and others, and put forward

measures to enhance our companywide

Auditors.

an audit opinion following due

compliance management.

consultation.
The two current Corporate Auditors

The Internal Control Committee

from outside have no personal or any

concerning financial reporting, chaired

other relationship through investments

by the president, discusses and preparesthat could create a conflict of interest infor the highly efficient Internal Control

the performance of their duties.

System enforced by Financial Instruments

Risk Management Committee, chairedby the president, explores and analyzes
the risks surrounding the Company. On
the basis of the analysis, the Committee
discusses the preventive measures orcountermeasures for the risks.

Annual Report 2012 Nippon Shokubai Co., Ltd.

09

Financial Position

At March 31, 2012, the Group has total assets of ¥356,407

Net cash provided by operating activities amounted tomillion, up ¥27,075 million from a year earlier. Within this¥43,857 million, up from ¥31,706 million in the previous year.

amount, current assets rose ¥22,045 million, to ¥182,879

Major factors included increases in income before income taxes

million. This was due mainly to increases in cash and cash

and notes and accounts payable–trade, as well as progress inequivalents and notes and accounts receivable–trade.

collection of notes and accounts receivable. By contrast, there

Noncurrent assets rose ¥5,030 million, to ¥173,528 million.

was an increase in income taxes paid.

This was due to an increase in property, plant and equipment,

Net cash used in investing activities totaled ¥21,747

stemming from capital expenditures, which outweighed amillion, up from ¥16,696 million in the previous year. Major

decrease in valuation of investments in securities.

factors included an increase in purchase of property, plant andTotal liabilities increased ¥12,271 million, to ¥147,337
million. This was due to a rise in notes and accounts payable–

equipment.
Net cash used in financing activities was ¥9,671 million, up

trade, which offset declines in short-term bank loans andfrom ¥3,050 million in the previous year. Main factors included

accrued income taxes.

the absence of proceeds from issuance of common stock

Net assets climbed ¥14,804 million, to ¥209,070 million,(posted in the previous year) and an increase in cash dividends

due mainly to an increase in retained earnings. This was despite

paid. By contrast, there was a decrease in repayment of shortdecreases in net unrealized holding gain on securities andterm loans payable.

translation adjustments. During the year, the Group cancelled
8,000 thousand shares of treasury stock. Accordingly, the year-

Cash Dividends

end balance of treasury stock was ¥890 million, down ¥7,100

For the year, the Company paid an interim dividend of ¥11.00

million from a year earlier.

and a year-end dividend of ¥11.00, bringing total annual

As a result, the equity ratio edged down 0.6 point, from

dividends to ¥22.00 per share, for a payout ratio of 21.0%. In

57.9% to ¥57.3%. Net assets per share rose ¥67.81, tothe fiscal year ending March 2013, the Company plans to pay¥1,006.48. Return on assets (ROA) remained unchanged, at

total annual dividends of ¥22.00 per share, consisting of an

9.7%, and return on equity (ROE) declined 1.3 points, to 10.8%.

¥11.00 interim dividend and an ¥11.00 year-end dividend.

Cash Flows
At fiscal year-end, the Group had cash and cash equivalents of¥50,812 million, up ¥11,638 million from a year earlier. This was
because net cash provided by operating activities was higher than
the sum of net cash used in investing activities (mainly capital
expenditures) and net cash used in financing activities (mainly
repayment of loans).

10

Nippon Shokubai Co., Ltd. Annual Report 2012

Consolidated Financial Statements

Five-Year Summary					Millions of Yen

Millions of
U.S. Dollars

2008

2009

2010

2011

2012

2012

Net Sales ........................................................... ¥302,669¥289,102¥244,317¥288,345¥ 320,704$3,901For the Years Ended March 31,
Operating Income...............................................

18,379662

13,881

29,813

31,100378

Net Income (Loss)...............................................

11,875(5,307)

10,832

21,11921,257258

Total Liabilities and net Assets ............................ 352,783

302,948

310,946

329,332

356,407

4,336

Total Shareholders' Equity...................................

–

154,900

163,244

198,092

214,672

2,611

Total Net Assets.................................................. 175,634

151,662

163,781

194,266

209,070

2,543¥ 831.11¥ 898.33¥ 938.67¥1,006.48$12.25
1.27

		

Yen

Net Assets per Share........................................... ¥ 947.34

U.S. Dollars

Net Income (Loss) per Share................................

64.91(29.61)60.85

110.30104.71

Fully Diluted Net Income per Share......................

–

–

–

–

–

Share Price . .......................................................

661

622

845

1,042

959

11.66

Capital Ratio (%).................................................

48.6

48.8

51.4

57.9

57.3

–

Return on Equity (%)...........................................

6.9

(3.3)

7.0

12.1

10.8

–

Price Earnings Ratio (times).................................

10.2

–

13.9

9.4

9.2

–

			
		
Millions of Yen

Cash Flow from Operating Activities . ................. ¥ 20,129
Cash Flow from Investing Activities.....................

(33,100)

Millions of
U.S. Dollars¥ 17,613¥ 44,346¥ 31,706¥ 43,857$ 533(16,675)(23,850)(16,696)(21,747)(264)

Cash Flow from Financing Activities.....................

17,495

8,099(21,772)(3,050)(9,671)(117)

Cash and Cash Equivalents at Year-end...............

21,371

29,45028,234

39,17450,812

618

Numbers of Employees.......................................

3,290

3,415

3,430

3,576

3,779

–

Notes 1: Foreign Exchange Rate: U.S. $1.00 = ¥82.19
2: Net Sales do not include consumption taxes.
3: Fully diluted Net Income per Share is not recorded because no dilutive shares exist.
Diluted Earnings per Share for the fiscal year 2008 ended Mar. 31, 2009 is not disclosed because of the net loss in the consolidated results,
and the anti-dilutive effect.
4: Price Earnings Ratio for the fiscal year ended Mar. 31, 2009 is not disclosed because of the net loss in the consolidated results.

Annual Report 2012 Nippon Shokubai Co., Ltd.

11

Consolidated Balance Sheets

Consolidated
Balance
SheetsNippon ShokubaiCo., Ltd. andConsolidated Subsidiaries
Nippon Shokubai Co., Ltd. and Consolidated Subsidiaries

March 31,

2012

2012

2011

(Thousands of
U.S. dollars)(Note 2)

(Millions of yen)

AssetsCurrent assets:
Cash and cash equivalents (Note 4)
Time deposits (Notes 4 and 8)
Notes and accounts receivable (Note 4):
Unconsolidated subsidiaries and affiliates
Trade
Allowance for doubtful receivables
Inventories (Note 6)
Deferred income taxes (Note 10)
Other current assets
Total current assets¥

Property, plant and equipment, at cost
(Notes 7, 8 and 20):Land
Buildings and structures
Machinery and equipment
Construction in progress
Leased assets
Accumulated depreciation
Property, plant and equipment, net

Investments and other assets:
Investments in securities (Notes 4 and 5)
Investments in unconsolidated subsidiaries and affiliates
Deferred income taxes (Note 10)Prepaid pension cost (Note 9)
Other assets (Notes 7 and 8)
Total investments and other assets

Total assets

122

Nippon Shokubai Co., Ltd. Annual Report 2012¥

50,812952¥

39,174130$

618,226
11,583

5,486
72,608(64)
44,012
3,753
5,320
182,879

7,855
64,821(74)
39,4153,707
5,807
160,835

66,748883,416(779)
535,491
45,66264,7292,225,076

32,271
82,157
298,591
16,363542(307,198)
122,726

31,567
79,232
289,3232,649
523(287,501)
115,793392,639
999,598
3,632,937
199,087
6,594(3,737,656)
1,493,199

20,21916,851
4,617
3,168
5,947
50,80221,80317,026
3,517
3,158
7,200
52,704

246,003
205,025
56,17538,54572,356618,104

356,407¥329,332$

4,336,379

March 31,

2012
Liabilities and Net Assets
Current liabilities:
Short-term bank loans (Notes 4 and 8)
Current portion of long-term debt (Notes 4 and 8)
Notes and accounts payable (Note 4):
Unconsolidated subsidiaries and affiliates
Trade
Lease obligations
Accrued bonuses to employees
Accrued bonuses to directors and corporate auditors
Reserve for periodic repairs
Reserve for loss on disasterAccrued income taxes (Note 10)
Other current liabilities
Total current liabilities(Thousands of
U.S. dollars)(Note 2)

(Millions of yen)¥

14,373
14,694

2012

2011

¥

16,7494,884$

174,875
178,781

4,571
48,566
44
2,991
193
2,359
104
7,144
10,249105,288

6,193
33,450
30
2,798
177
2,586
180
7,639
7,113
81,79955,615590,899535
36,391
2,348
28,702
1,266
86,921
124,699
1,281,032

30,224172
10,251260
1,142
42,04942,418
198
9,079
284
1,288
53,267367,733
2,093
124,723
3,163
13,895
511,607

Net assets:
Shareholders’ equity (Note 11):
Common stock:
Authorized – 636,000,000 shares;
Issued – 204,000,000 shares in 2012 and
212,000,000 shares in 2011
Capital surplus
Retained earnings
Less treasury stock, at cost
Total shareholders’ equity

25,03822,083
168,441(890)
214,672

25,03822,083
158,961(7,990)198,092

304,636
268,6822,049,410(10,829)
2,611,899

Accumulated other comprehensive income (loss):
Net unrealized holding gain on securities
Translation adjustments
Net unrealized deferred loss on hedges
Total accumulated other comprehensive loss, net
Minority interests
Total net assets
Total liabilities and net assets

1,366(11,721)(2)(10,357)
4,755
209,070
356,407

2,367(9,885)(17)(7,535)
3,709
194,266
329,332

16,620(142,609)(24)(126,013)
57,8542,543,740
4,336,379

Long-term liabilities:
Long-term debt (Notes 4 and 8)
Lease obligations
Accrued retirement benefits for employees (Note 9)
Deferred income taxes (Note 10)
Other
Total long-term liabilities
Contingent liabilities (Note 17)

¥

¥

$

3

Annual Report 2012 Nippon Shokubai Co., Ltd.

13

Consolidated
Statementsof IncomeConsolidated
Statementsof IncomeNippon Shokubai Co., Ltd. and Consolidated Subsidiaries
Nippon Shokubai Co., Ltd. and Consolidated Subsidiaries

Years ended March 31,

2011

2012

2012

(Thousands of
U.S. dollars)(Note 2)

(Millions of yen)

Net sales (Note 20)¥

Cost of sales (Note 12)
Gross profit¥

288,345
221,796$

3,901,983
3,070,483

68,341

66,549831,500

37,241

36,736453,108

31,10029,813378,392

958
(735)
584

699
(874)
416

11,656(8,943)
7,105

2,353
(840)
–

2,354
(938)
(362)

28,629(10,220)
–

(280)
1,157
1,105
–
100
(449)
(264)
(134)
(1,328)

(571)
1,198
1,161
322
138
(402)
(191)
–
(2,361)(3,407)
14,077
13,444–
1,217(5,463)(3,212)(1,630)(16,158)

33,32730,402405,487

11,778(158)

9,992(1,004)

143,301(1,922)

11,6208,988

141,379

Income before minority interests

21,707

21,414

264,108

Minority interests in earnings of consolidated
subsidiaries

(450)

(295)

(5,476)

Selling, general and administrative expenses (Note 12)
Operating income (Note 20)
Other income (expenses):
Interest and dividend income
Interest expense
Royalty income
Equity in earnings of an unconsolidated subsidiary
and affiliates
Foreign exchange loss
Loss on devaluation of investments in securities
Loss on impairment of property, plant andequipment (Notes 7 and 20)
Rent income from real estate
Gain on insurance claims (Note 13)
Gain on sales of property, plant and equipment
Government subsidies
Loss on reduction of property, plant and equipment
Loss on disposal of property, plant and equipment
Loss on discontinued operations
Other, net
Income before income taxes and minority
interests
Income taxes (Note 10):
Current
Deferred

Net income

14

320,704
252,363

Nippon Shokubai Co., Ltd. Annual Report 2012¥

21,257¥

21,119$258,6324

Consolidated
Statementsof Comprehensive
IncomeConsolidated
Statementsof Comprehensive
IncomeNippon Shokubai Co., Ltd. and Consolidated Subsidiaries
Nippon Shokubai Co., Ltd. and Consolidated Subsidiaries

Years ended March 31,

2011

2012

2012
(Thousands of
U.S. dollars)(Note 2)

(Millions of yen)

Income before minority interests
Other comprehensive income (loss)
Net unrealized holding loss on securities
Net unrealized deferred gain on hedges
Translation adjustments
Other comprehensive loss of equity method
affiliates attributable to the Company¥ 21,707¥ 21,414$ 264,108(1,002)
1(1,544)(253)
1(3,679)(12,191)12(18,786)

(365)

(514)

(4,441)

Total other comprehensive loss (Note 14):

(2,910)(4,445)(35,406)

Comprehensive income¥ 18,797¥ 16,969$ 228,702

Comprehensive income attributable to:Shareholders of the Company
Minority interests¥ 18,435
362¥ 16,90564$ 224,298
4,404

5

Annual Report 2012 Nippon Shokubai Co., Ltd.

15

Consolidated
Statementsof Changes
in NetAssetsConsolidated
Statementsof Changes
in NetAssetsNipponShokubaiCo., Ltd.Subsidiaries
and Consolidated Subsidiaries
Nippon ShokubaiCo., Ltd.
and Consolidated

Shareholders’ equity
Capitalsurplus

Common stock

Retainedearnings

Less treasury
stock,
at costTotal
shareholders’equity¥¥(Millions of yen)
Balance at April 1, 2010¥

16,529¥13,574¥

141,118(7,977)

163,244

Changes during the year:
8,509

8,509

–

–

Cash dividends––(3,276)–(3,276)

Net income––

21,119–21,119Purchases of treasury stock

–

–

–

(15)

(15)

Disposition of treasury stock

–

0

–

2

2

Issuance of new stock

Net changes in items other thanshareholders’ equity
Total changes during the year

–

–

–

–

–

8,509

8,509

17,843(13)

34,848¥ 25,038

Balance at March 31, 2011

17,018¥22,083¥

158,961¥

Accumulated other comprehensive income (loss)
Net
Total
Net
unrealized
accumulated
unrealized
deferredotherholding gain
loss
comprehensive
Translation
on securities adjustmentson hedges
loss, net

(7,990)¥198,092

Minority
interests

Total net assets¥¥(Millions of yen)
Balance at April 1, 2010

¥

2,615

¥

(5,901)¥ (35)¥(3,321)

3,858

163,781

Changes during the year:
Issuance of new stock

–

–

–

–

–

Cash dividends

–

–

–

–

–

(3,276)

Net income

–

–

–

–

–

21,119Purchases of treasury stock
Disposition of treasury stock

–
–

–
–

–
–

–
–

–
–

(15)
2

Net changes in items otherthan shareholders’ equity(248)(3,984)18(4,214)(149)(4,363)

Total changes during the year(248)

(3,984)18(4,214)(149)

30,485(9,885)¥ (17)

Balance at March 31, 2011

¥

2,367

¥

6

16

Nippon Shokubai Co., Ltd. Annual Report 2012¥

(7,535)¥

3,709

17,018¥194,266

NipponCo., Ltd. andConsolidated Subsidiaries
Nippon Shokubai
Co.,ShokubaiLtd. and Consolidated
Subsidiaries

Shareholders’ equity

Common stock

CapitalsurplusLess treasury
stock,
at costTotal
shareholders’equity¥ 158,961¥ (7,990)¥ 198,092

Retainedearnings(Millions of yen)

Balance at April 1, 2011

¥ 25,038¥ 22,083

Changes during the year:
Cash dividends––(4,669)–(4,669)Net income––

21,257–

21,257Purchases of treasury stock

–

–

–

(9)

(9)

Disposition of treasury stock

–

0

(0)

1

1

Retirement of shares of common
stock held in treasury–(0)(7,108)

7,108–

Net changes in items other thanshareholders’ equity

–

–

–

–

–

–

(0)

9,480

7,100

16,580¥ 25,038¥ 22,083¥ 168,441¥ (890)¥ 214,672

Total changes during the year
Balance at March 31, 2012

Accumulated other comprehensive income (loss)
Total
accumulated
Net
Net
other
unrealized
unrealized
comprehensive
holding gain
deferred loss
Translation
loss, neton securities
on hedges
adjustments

Minority
interests

Total net
assets¥3,709¥ 194,266(Millions of yen)
Balance at April 1, 2011

¥ 2,367¥ (9,885)

¥

(17)

¥

(7,535)

Cash dividends

–

–

–

–

–

(4,669)Net income

–

–

–

–

–

21,257Purchases of treasury stock

–

–

–

–

–

(9)

Disposition of treasury stock

–

–

–

–

–

1

Retirement of shares ofcommon stock held in treasury

–

–

–

–

–

–

Changes during the year:

Net changes in items other thanshareholders’ equity
Total changes during the year
Balance at March 31, 2012

(1,001)(1,836)15(2,822)

1,046(1,776)(1,001)(1,836)15(2,822)

1,046

14,804¥ 1,366¥ (11,721)

4,755¥ 209,070

¥

(2)

¥

(10,357)¥

7

Annual Report 2012 Nippon Shokubai Co., Ltd.

17

Nippon Shokubai Co., Ltd. and Consolidated Subsidiaries

Nippon Shokubai Co., Ltd. and Consolidated Subsidiaries
Shareholders’ equity
Commonstock

CapitalsurplusRetainedearnings

Total
shareholders’equityLess treasury
stock, at cost(Thousands of U.S. dollars) (Note 2)$

Balance at April 1, 2011

304,636$

268,682$

1,934,068$(97,214)$2,410,172

Changes during the year:
Issuance of new stock––

Cash dividends––(56,807)–(56,807)

Net income––

258,632–

258,632–––

Purchases of treasury stock

–

–

–

(110)

(110)

Disposition of treasury stock

–

0

(0)

12

12

Retirement of shares of common
stock held in treasury–(0)(86,483)

86,483–

Net changes in items other thanshareholders’ equity

–

–

–

–

–

–

(0)

115,342

86,385201,727

Total changes during the year$

Balance at March 31, 2012

304,636$

268,682$2,049,410$

Accumulated other comprehensive income (loss)
Net
Total
unrealized
accumulated
Netdeferredother
unrealized
loss oncomprehensive
holding gain
Translation
hedgesloss, neton securities
adjustments(10,829)$

2,611,899

Minority
interests

Total net
assets$$ 2,363,621(Thousands of U.S. dollars) (Note 2)
Balance at April 1, 2011$

Changes during the year:
Issuance of new stock
Cash dividends$(120,271)

–

–

–

–

–

Net income$ (194)$––(91,678)

45,127

–

–

–

–
–

–
(56,807)

–

–

–

–

–

–

–

–

(110)

–

–

–

–

–

12

–

–

–

–

–

–

Net changes in items otherthan shareholders’ equity(12,167)(22,338)170(34,335)

12,727(21,608)

Total changes during the year

(12,167)(22,338)170(34,335)

12,727

180,11957,854$ 2,543,740

Purchases of treasury stock
Disposition of treasury
stock
Retirement of shares ofcommon stock held intreasury

Balance at March 31, 201218

28,787$

16,620$(142,609)

$

(24)

$

See accompanying notes to consolidated financial statements.

(126,013)$

258,632

Nippon Shokubai Co., Ltd. Annual Report 20128

Consolidated
Statementsof CashFlows
Consolidated
Statementsof CashFlows
Nippon Shokubai Co., Ltd. and Consolidated Subsidiaries

Nippon Shokubai Co., Ltd. and Consolidated Subsidiaries
Years ended March 31,

2012

Operating activities:
Income before income taxes and minority interests
Adjustments to reconcile income before income taxes andminority interests to net cash provided by operating
activities:
Depreciation and amortization
Loss on discontinued operations
Loss on impairment of property, plant and equipment
Loss on devaluation of investments in other securities
Increase in accrued retirement benefits for employees
Interest and dividend income
Interest expense
Equity in earnings of an unconsolidated subsidiary andaffiliates
Loss on disposal of property, plant and equipment
Stock issuance cost
Fire damage to factory equipment
Loss on reduction of property, plant and equipment
Gain on insurance claims
Gain on sales of property, plant and equipment
Government subsidies
Other, net
Changes in operating assets and liabilities:
Notes and accounts receivable
Inventories
Notes and accounts payable
Other current liabilities
SubtotalInterest and dividends received
Interest paid
Proceeds from insurance claims
Proceeds from government subsidies
Payment of income taxes
Other, net
Net cash provided by operating activities
Investing activities:
Purchases of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchases of short-term investments and investments insecurities
Proceeds from sales of short-term investments andinvestments in securities
Proceeds from redemption of investments in securities
Payments for purchases of shares of affiliates
Proceeds from purchase of investments in subsidiaries
resulting in change in scope of consolidation (Note 15)
Collection of loans receivable
Other, net
Net cash used in investing activities

2011

2012
(Thousands of
U.S. dollars)(Note 2)

(Millions of yen)

¥ 33,327¥ 30,402$ 405,487

16,767
134
280
–
478
(958)
735

15,619
–
571
362
317
(699)
874

204,003
1,630
3,407
–
5,816
(11,656)
8,943(2,353)270––
449(1,105)
–
(100)
1,832

(2,354)
172
97
839
402
(1,161)
(322)
(138)
1,902

(28,629)
3,285
–
–
5,463
(13,444)–(1,217)22,290(2,534)(4,395)
10,684105
53,616
2,022
(745)
1,226
100
(12,362)–
43,857(10,910)(3,327)3,080(239)
35,487
1,739
(884)
1,034
138
(4,879)(929)
31,706(30,831)(53,474)
129,991
1,278
652,342
24,602(9,064)
14,9171,217(150,409)–
533,605(20,883)4(15,301)
396(254,082)
49

(451)

(2,610)(5,487)

193
200
(18)

330
200
(177)

2,348
2,433
(219)

182
132
(1,106)¥ (21,747)

–
134
332
¥ (16,696)

2,214
1,606
(13,456)$ (264,594)

Annual Report 2012 Nippon Shokubai Co., Ltd.

919

NipponShokubaiCo., Ltd.Subsidiaries
and Consolidated Subsidiaries
Nippon ShokubaiCo., Ltd.
and Consolidated

Years ended March 31,

2012

2011

(Millions of yen)

Financing activities:
Decrease in short-term bank loans, net
Proceeds from long-term debt
Repayment of long-term debt
Cash dividends paid
Proceeds from issuance of common stock
Payments of stock issuance cost
Purchases of treasury stock
Other, net
Net cash used in financing activities
Effect of exchange rate changes on cash and cash equivalents
Increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year

¥ (2,587)
2,542(4,872)(4,669)
–
–
(9)
(76)
(9,671)(801)
11,63839,174¥ 50,812

See accompanying notes to consolidated financial statements.

20

Nippon Shokubai Co., Ltd. Annual Report 2012

¥ (9,255)
210(7,585)(3,276)
17,018
(97)
(15)
(50)
(3,050)(1,020)10,94028,234¥ 39,174

2012(Thousands of
U.S. dollars)(Note 2)$ (31,476)
30,928(59,277)(56,807)
–
–
(110)
(924)
(117,666)(9,746)
141,599476,627$ 618,22610

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements

Nippon Shokubai Co., Ltd. and Consolidated Subsidiaries March 31, 2012

Nippon Shokubai Co., Ltd. and Consolidated Subsidiaries

March 31, 2012

1. Summary of Significant Accounting Policies(a) Basis of presentation
The accompanying consolidated financial statements of Nippon Shokubai Co., Ltd. (the“Company”) and its consolidated subsidiaries are prepared on the basis of accounting
principles generally accepted in Japan, which are different in certain respects as to theapplication and disclosure requirements of International Financial Reporting Standards,
and are compiled from the consolidated financial statements prepared by the Company
as required by the Financial Instruments and Exchange Act of Japan.
In preparing the accompanying consolidated financial statements, certain
reclassifications and rearrangements have been made to the consolidated financial
statements issued domestically in order to present them in a format which is morefamiliar to readers outside Japan.
(b) Basis of consolidation
The accompanying consolidated financial statements include the accounts of theCompany and its significant subsidiaries. All significant intercompany items havebeen eliminated in consolidation.
The overseas consolidated subsidiaries are consolidated on the basis of fiscal periods
ending December 31, a date which differs from the balance sheet date of the Company.
As a result, adjustments have been made for any significant intercompany transactions
which took place during the period between the year end of these overseas consolidated
subsidiaries and the year end of the Company.
Investments in an unconsolidated subsidiary and significant affiliates are accounted
for by the equity method.
Investments in unconsolidated subsidiaries and affiliates not accounted for by theequity method are carried at cost.
(c) Foreign currency translation
The financial statements of the overseas consolidated subsidiaries are translated into yen
at the rates of exchange in effect at the balance sheet date, except that the components
of net assets excluding minority interests are translated at their historical exchange rates.
Differences resulting from translating the financial statements of the overseas
consolidated subsidiaries are not included in the determination of net income but arereported as translation adjustments and minority interests in the accompanying
consolidated balance sheets at March 31, 2012 and 2011.
Revenue and expense items arising from transactions denominated in foreign
currencies are generally translated into yen at the rates of exchange in effect at therespective transaction dates.
All monetary assets and liabilities denominated in foreign currencies are translated
into yen at the rates of exchange in effect at the balance sheet date and gain or loss oneach translation is credited or charged to income.
(d) Cash and cash equivalents
Cash and cash equivalents include cash on hand and in banks and other highly liquid
investments with maturities of three months or less when purchased.
(e) Allowance for doubtful receivables
The Company and its consolidated subsidiaries provide an allowance for doubtful
11

Annual Report 2012 Nippon Shokubai Co., Ltd.

21

receivables at an amount calculated based on their historical experience of bad debts on
ordinary receivables plus an additional estimate of probable specific bad debts from
customers experiencing financial difficulties.
(f) Inventories
Inventories are stated at the lower of cost or net selling value, cost being determinedprimarily by the moving average method.
(g) Property, plant and equipment
Depreciation is computed principally by the straight-line method over the estimateduseful lives of the respective assets except for leased assets.
(h) Leases
Leased assets under finance lease transactions that do not transfer ownership to thelessee are depreciated to a residual value of zero by the straight-line method using thecontract term as the useful life.
For finance lease transactions that do not transfer ownership to the lessee, those thatstarted on or before March 31, 2008 continue to be accounted for as operating leasetransactions.
(i) Short-term investments and investments in securities
Securities are classified into three categories: trading securities, held-to-maturity debt
securities and other securities. Trading securities, consisting of debt and marketable
equity securities, are carried at fair value. Gain and loss, both realized and unrealized,
are credited and charged to income. Held-to-maturity debt securities are carried atamortized cost. Marketable securities classified as other securities are carried at fairvalue, with any changes in unrealized holding gain or loss, net of the applicable income
taxes, reported as a separate component of net assets. Non-marketable securities
classified as other securities are carried at cost. Cost of securities sold is determinedby the moving average method.
(j) Research and development costs and computer software
Research and development costs are charged to income when incurred.
Expenditures relating to the development of computer software intended for internal
use are charged to income as incurred, except if these are deemed to contribute to thegeneration of future income or cost savings. Such expenditures are capitalized asassets and amortized by the straight-line method over their respective estimated useful
lives, generally a period of 5 years.
(k) Income taxes
Income taxes are calculated based on taxable income and charged to income on an
accrual basis. Deferred income tax assets and liabilities are computed based on thetemporary differences between financial reporting and the tax bases of the assets andliabilities which will result in taxable or tax-deductible amounts in the future. The
calculation of deferred income tax assets and liabilities is based on the enacted tax laws.
(l) Hedge accounting
Gain or loss on derivatives positions designated as hedges is deferred until the loss orgain on the respective underlying hedged items is recognized. Interest rate swaps
which meet certain conditions are accounted for as if the interest rates applied to theswaps had originally applied to the underlying debt.
12

22

Nippon Shokubai Co., Ltd. Annual Report 2012

Forward foreign currency exchange contracts which meet certain criteria areaccounted for by the allocation method which requires that recognized foreign currency
receivables or payables be translated at the corresponding contract rates (“Allocation
method”).
(m) Accrued bonuses to employees
Accrued bonuses to employees are provided based on the estimated amount of bonuses
to be paid to employees which is charged to income in the current year.
(n) Accrued bonuses to directors and corporate auditors
Accrued bonuses to directors and corporate auditors are provided at an estimate of theamount to be paid in the following year which has been allocated to the current fiscal
year.
(o) Reserve for periodic repairs
The Company and certain consolidated subsidiaries provide a reserve for the cost of
periodic repairs to production facilities at plants based on their estimates of the future
cost of such repairs.
(p) Reserve for loss on disasterA domestic consolidated subsidiary has recorded a reserve for loss on disaster at theamount estimated to be necessary to provide for restoration of assets damaged by theGreat East Japan Earthquake.
(q) Retirement benefits
Accrued retirement benefits for employees have been provided based on the retirement
benefit obligation and the fair value of the pension plan assets as adjusted for
unrecognized actuarial gain or loss and unrecognized prior service cost.
Prior service cost is amortized principally by the straight-line method over a periodof 5 years, which is within the estimated average remaining years of service of theeligible employees.
Actuarial gain or loss is amortized in the year following the year in which the gain orloss is recognized principally by the straight-line method over a period of 10 years,
which is within the estimated average remaining years of service of the eligible
employees.
(r) Distribution of retained earnings
Under the Corporation Law of Japan, the distribution of retained earnings with respect
to a given financial period is made by resolution of the shareholders at a general
meeting held subsequent to the close of the financial period. The accounts for that
period do not, therefore, reflect such distributions (see Note 22).
(s) Recognition of contract revenue and cost
The Company recognizes revenue by applying the percentage-of-completion method forthe construction projects for which the outcome of the construction activity is deemedcertain at the end of the reporting period. To estimate the progress of such
construction projects, the Company measures the percentage of completion bycomparing costs incurred to date with the most recent estimate of total costs required tocomplete the project (cost to cost basis). For other construction projects where theoutcome cannot be reliably measured, the completed-contract method is applied.
13
Annual Report 2012 Nippon Shokubai Co., Ltd.

23

(Supplementary information)(Application of accounting standard for accounting changes and error corrections)
Effective the year ended March 31, 2012, the Company and its domestic consolidated
subsidiaries have applied “Accounting Standard for Accounting Changes and Error
Corrections” (Accounting Standards Board of Japan (“ASBJ”) Statement No.24 issued on
December 4, 2009) and “Guidance on Accounting Standard for Accounting Changes andError Corrections” (ASBJ Guidance No.24 issued on December 4, 2009).
2. U.S. Dollar Amounts
The translation of yen amounts into U.S. dollar amounts is included solely for convenience,as a matter of arithmetic computation only, at ¥82.19 = U.S. $1.00, the approximate rate ofexchange in effect on March 31, 2012. This translation should not be construed as arepresentation that yen have been, could have been, or could in the future be, converted into
U.S. dollars at the above or any other rate.
3. Notes Receivable and Notes Payable
The balance sheet date for the year ended March 31, 2012 fell on a bank holiday.
Consequently, notes receivable, trade of ¥264 million ($3,212 thousand), notes payable,
trade of ¥362 million ($4,404 thousand) and notes payable of ¥14 million ($170 thousand)related to the purchase of equipment included in other current liabilities with a maturity dateof March 31, 2012 were included in the respective balances in the consolidated balance
sheet at March 31, 2012 and were settled on the next business day.
4. Financial Instruments(1) Current status of financial instruments
1) Policy for financial instruments
The Group manages temporary surplus funds through short-term bank deposits. The
Group raises funds through bank loans. The Group uses derivatives for the
purpose of reducing foreign currency exchange rate fluctuation risk or interest rate
fluctuation risk, and does not enter into derivatives for speculative or trading
purposes.
2) Types of financial instruments and related risk
Notes and accounts receivable, trade are exposed to credit risk in relation tocustomers.
Trade receivables in foreign currencies, arising from exporttransactions for the global business, are exposed to foreign currency exchange rate
fluctuation risk, which are hedged by forward foreign exchange contracts.
Investments in securities are composed of the shares of common stock ofother companies with which the Group has business or capital relationships, which
are also exposed to market price volatility risk.
Substantially all notes and accounts payable, trade have payment due dates
within one year, which are also hedged by forward foreign currency exchange
contracts. The loans are taken out principally for the purpose of making capital
expenditures. The loans with variable interest rates are exposed to interest rate
fluctuation risk. However, the interest rate fluctuation risk is covered by interest
rate swap transactions.
Regarding derivatives, the Group enters into forward foreign currency
exchange transactions to avoid foreign currency exchange rate fluctuation risk
related to trade receivables and trade payables denominated in foreign currencies.
14

24

Nippon Shokubai Co., Ltd. Annual Report 2012

The Group also enters into interest rate swap transactions to avoid interest rate
fluctuation risk related to the loans.
Further information regarding the method of hedge accounting, hedging
instruments and hedged items, hedging policy, and the assessment of theeffectiveness of hedging activities can be found in Note 19.
3) Risk management for financial instrumentsi)

Monitoring for credit risk (the risk that customers or counterparties may
default)
With respect to trade receivables, each related division of the Company
monitors the conditions of their main customers periodically, monitors due
dates and outstanding balances of individual customers, and evaluates credit
worthiness of their main customers semiannually.
The consolidated
subsidiaries also monitor trade receivables in a same manner.
The Group acquires held-to-maturity debt securities such as corporate bonds
or other securities, that have high credit ratings. Accordingly, the Group
believes that the credit risk deriving from such debt securities is insignificant.
The Group also believes that the credit risk of derivatives is insignificant as
the Group enters into derivative transactions only with financial institutions
with high credit ratings.

ii) Monitoring of market risks (the risks arising from fluctuations in foreignexchange rates, interest rates and others)
For trade receivables and trade payables in foreign currencies, the Group enters
into forward foreign currency exchange contracts.
For investments in securities, the Group periodically reviews the fair valuesof such financial instruments and the financial position of the issuers. In
addition, the Group continuously evaluates whether securities other than thoseclassified as held-to-maturity should be maintained taking into account theirfair values and relationships with the issuers.
For derivative transactions, the finance department of the Company enters
into and manages derivative transactions. Results of derivative transactions
are reported to the director in charge monthly.
iii) Monitoring of liquidity risk (the risk that the Group may not be able to meet its
obligations on the scheduled due dates)
Based on reports from each division, the Group prepares and updates its cash
flow plans on a timely basis to manage liquidity risk.
4) Supplementary explanation of the estimated fair value of financial instruments
The notional amounts of derivatives in the following table are not necessarily
indicative of the actual market risk involved in derivative transactions.
(2) Fair value of financial instruments
Carrying value, fair value, and unrealized loss on financial instruments at March 31,
2012 and 2011 are shown in the following table. The following table does not include
financial instruments for which it is extremely difficult to determine the fair value.

15
Annual Report 2012 Nippon Shokubai Co., Ltd.

25

2012
Carrying
value
Assets:i)1Cash and cash equivalents,
and time depositsii)iiNotes and accounts
receivable¥

51,7642011(Millions of yen)
Unrealized
loss
Carrying value

Fair
value

¥

51,764

¥

–

¥

Fair
value

39,304¥

Unrealized
loss

39,304¥–78,09478,094–

72,676

72,676–

19,332

19,332–

20,64820,648–iii)iInvestments in securities:
Other securities
Total assets¥

149,190¥

149,190¥–¥

132,628¥

132,628¥–¥

53,137¥53,137¥–¥39,643¥39,643¥–Liabilities:iv)i Notes and accounts
payablev)ii Short-term bank loansvi)i Current portion of
long-term loansvii)1Long-term loans

14,373

14,373–

16,74916,749–9,694
20,224

9,761
20,374

67
150

4,884
27,418

4,908
27,693

24
275

¥ 217

¥

88,694¥

88,993

¥ 299

¥

¥

(5)

¥

(5)

Total liabilities¥

97,428¥97,645Derivatives

¥

(3)

¥

(3)

–

¥

–

2012
(Thousands of U.S. dollars)
Fair
Carrying value
value
Unrealized loss
Assets:i)ii Cash and cash equivalents, and time depositsii)ii Notes and accounts receivableiii)iInvestments in securities:$

629,809950,164$

629,809950,164

Total assets$

1,815,184$

1,815,184$–

Liabilities:iv)iiNotes and accounts payable$

646,514$646,514$–

174,875

174,875–

Total liabilities$

117,946
246,064
1,185,399$

118,761
247,889
1,188,039

$

815
1,825
2,640

Derivatives

$

(37)

$

(37)

$

–

235,211

Other securitiesv)iiiShort-term bank loansvi)i Current portion of long-term loansvii)iLong-term loans$

235,211–––

1) Calculation methods of fair value of financial instruments, securities, andderivatives are as follows:
Assets:i) Cash and cash equivalents, time deposits, and ii) notes and accounts receivable
Since these items are settled in a short period of time, their carrying values
approximate the fair value.
iii) Investments in securities
Please refer to Note 1(i).
1626

Nippon Shokubai Co., Ltd. Annual Report 2012

Liabilities:iv) Notes and accounts payable, and v) short-term bank loans
Since these items are settled in a short period of time, their carrying values
approximate the fair value.
vi) Current portion of long-term debt, and vii) long-term debt
The fair value of long-term debt is based on present value of the total amountincluding principal and interest, discounted by the expected interest rate in thecase of new borrowings under the same conditions and in the same amount of
the balance as of the end of the period. Long-term loans with floating interest
rates were hedged by interest-rate swap agreements and accounted for as loans
with fixed interest rates. The estimated fair value of those long-term loans isreasonably based on the present value of the total of principals, interests andnet cash flows of swap agreements discounted by the interest rates, estimatedreasonably, applicable to loans made under similar conditions.
Derivative transactions:
Please refer to Note 19.
2) Financial instruments for which it is extremely difficult to determine the fair value:
Other securities whose market value was not determinable at March 31, 2012 and2011 are presented as follows:
2012

2011

2012

(Thousands of
U.S. dollars)(Millions of yen)

Unlisted securities and other¥ 1,155¥ 887$ 10,792

Since there is no market price for unlisted securities and it is difficult to determine
the fair value, they are not included in the above iii), “Investments in securities” inthe preceding table “(2) Fair value of financial instruments.”
3) The redemption schedule for monetary assets and securities classified as
held-to-maturity debt securities with maturity dates as of March 31, 2012 and 2011is as follows:
2012

2011
(Millions of yen)

Due after one year
through five years

Due within
one year
Cash and cash equivalents, and time
deposits
Notes and accounts receivable
Investments in securities:
Held-to-maturity debt securities(unlisted foreign debt securities)¥

51,76478,094¥–¥

129,858

–
–

¥

200
¥

200

Due after one
year throughfive years

Due within
one year
39,304
72,676¥–¥111,980

–
–
400

¥

400

17

Annual Report 2012 Nippon Shokubai Co., Ltd.

27

2012
(Thousands of U.S. dollars)
Due after one year
Due within one year
through five years
Cash and cash equivalents, and time deposits
Notes and accounts receivable
Investments in securities:
Held-to-maturity debt securities (unlisted foreign debt securities)$

629,809950,164$–
1,579,973

$

$

–
–
2,433
2,433

5. Short-Term Investments and Investments in Securities
Marketable securities classified as other securities at March 31, 2012 and 2011 aresummarized as follows:
2012
Book value (fairmarket value)

2011(Millions of yen)
UnrealizedBook value (fairgain (loss)
market value)

Cost

Unrealized
gain (loss)

Cost

Securities whose fairmarket value exceeds
their cost:
Equity securities
Subtotal
Securities whose costexceeds their fairmarket value:
Equity securities
Subtotal
Total

¥

¥

11,887

¥

8,335

¥

3,552

¥

17,800¥13,357¥

4,443

11,887

8,335

3,552

17,80013,357

4,443

7,445
7,445
19,332

8,917
8,917
17,252(1,472)(1,472)¥ 2,080

2,848
2,848
20,6483,555
3,555
16,912

(707)
(707)
3,736

¥

¥

¥

¥

2012
(Thousands of U.S. dollars)Book value(fair market value)
Securities whose fair market value exceeds their cost:
Equity securities
Subtotal
Securities whose cost exceeds their fair market value:
Equity securities
Subtotal
Total

$

$

144,628
144,628
90,58390,583
235,211

Cost$$

101,411
101,411
108,493
108,493
209,904

Unrealized gain
(loss)$$

43,21743,217(17,910)(17,910)25,307

The above book value presents the amount after the recognition of loss on impairment.
The Company and its consolidated subsidiaries recorded a loss on impairment amounting to¥362 million for marketable securities classified as other securities for the year ended March
31, 2011.
Sales of other securities for the years ended March 31, 2012 and 2011 were as
follows:
2011

2012

(Millions of yen)

Proceeds
Gross realized gain

28

¥ 193
¥
6

2012

(Thousands of
U.S. dollars)

¥ 5
¥ –

$ 2,348$
73

18
Nippon Shokubai Co., Ltd. Annual Report 2012

6. Inventories
Inventories at March 31, 2012 and 2011 were as follows:
2011

2012

2012
(Thousands of
U.S. dollars)(Millions of yen)

Merchandise and finished goods
Raw materials
Work in process
Supplies
Total¥ 24,291
9,732
6,761
3,228
¥ 44,012¥ 21,690
8,787
5,765
3,173
¥ 39,415$ 295,547
118,408
82,261
39,275$ 535,491

7. Loss on Impairment of Property, Plant and Equipment
Property, plant and equipment are primarily grouped based on the business segmentcategories designated for management control purposes.
For the year ended March 31, 2012, the Company determined to discontinue
providing Company owned employee housing in Ibaraki prefecture and to sell its land,
which had been used since 1987. Accordingly, the Company has written down such assets
to their respective net recoverable amounts. The net recoverable amounts of these impaired
assets were measured at net selling value based on the appraisal value determined by a realestate agent.
For the year ended March 31, 2011, the Company determined that market expansion
was unlikely, market prices would decrease and a loss on process adhesive products would
continue. Accordingly, the Company has written down such assets to their respective net
recoverable amounts. The net recoverable amounts of assets impaired were measured at
net selling value based on prices issued by the Japanese Ministry of Land, Infrastructure,
Transport and Tourism.
Details of the loss on impairment of property, plant and equipment for the years
ended March 31, 2012 and 2011 are summarized as follows:2012
Company
Nippon ShokubaiCo., Ltd.

Application
Land for company owned
housing

Classification
Land, buildings andstructures and otherassets

Total（Millions of yen）

(Thousands of
U.S. dollars)

¥ 280
¥ 280

$ 3,407$ 3,4072011
Company
Nippon ShokubaiCo., Ltd.
Total

Application

Classification

Machines that produce
process adhesive products

Buildings and structures,
machinery and equipment andautomotive equipment（Millions of yen）
¥ 571
¥ 571

8. Short-Term Bank Loans and Long-Term Debt
Short-term bank loans consisted mainly of unsecured loans. The average interest rates on
short-term bank loans outstanding at March 31, 2012 and 2011 were 0.80% and 0.68%
respectively.

19
Annual Report 2012 Nippon Shokubai Co., Ltd.

29

Long-term debt at March 31, 2012 and 2011 consisted of the following:
2011

2012
Unsecured bonds payable in Japanese yen, at rates from
1.45% to 1.66%, due through 2014
Unsecured loans from banks and insurance companies,
payable in Japanese yen, at rates from 0.40% to 2.03%,
due through 2014
Unsecured loans from banks, payable in U.S. dollars, atrates from 0.77% to 0.86%, due through 2015
Unsecured loans from banks, payable in Chinese yuan,
at rates from 5.99% to 6.40%, due through 2013
Secured loans from banks payable in Japanese yen, at
rates from 1.41% to 1.68%, due through 2016
SubtotalLess current portion
Total

2012
(Thousands of
U.S. dollars)(Millions of yen)

¥ 15,000¥ 15,000$ 182,504

27,13830,640330,186

2,286

1,149

27,814

92

–

1,119

402
44,918(14,694)¥ 30,224

513
47,302(4,884)¥ 42,418

4,891
546,514(178,781)$ 367,733

The aggregate annual maturities of long-term debt subsequent to March 31, 2012 aresummarized below:(Thousands of
U.S. dollars)(Millions of yen)

Year ending March 31,

2013
2014
2015
2016
2017 and thereafter¥ 14,694
13,956
15,2461,017
5$ 178,781
169,801
185,497
12,37461¥ 44,918$ 546,514

Assets pledged as collateral for short-term bank loans, long-term debt, including the current
portion thereof, and notes and accounts payable at March 31, 2012 and 2011 were as
follows:
2012

Time deposits
Land
Buildings and structures
Machinery and equipment
Other assets
Total

¥

8
533
129
156
5
¥ 831

2012

2011

(Millions of yen)(Thousands of U.S. dollars)

¥

–
293
150
233
13
¥ 689

$

97
6,485
1,570
1,898
61
$ 10,111

9. Retirement Benefits
Employees of the Company and domestic consolidated subsidiaries are mainly covered byan employees’ retirement benefit plan and an employees’ pension plan. In addition, theCompany and a domestic consolidated subsidiary have established a retirement benefits trust.
The employees’ retirement benefit plan provides for lump-sum payments determined byreference to their basic salary, years of service and certain other factors. These plansprovide for lump-sum payments and/or annuity payments payable upon termination of
employment.
Certain domestic consolidated subsidiaries have multi-employer pension plans ordefined contribution pension plans.
20

30

Nippon Shokubai Co., Ltd. Annual Report 2012

plans.

Certain overseas consolidated subsidiaries have defined benefit/contribution pension

The following table sets forth the funded and accrued status of the pension plans andthe amounts recognized in the accompanying consolidated balance sheets at March 31, 2012
and 2011 for the Company’s and the consolidated subsidiaries’ defined benefit pension
plans:
20112012

Retirement benefit obligation at end of year
Fair value of plan assets at end of year
Unfunded retirement benefit obligation
Unrecognized actuarial loss
Unrecognized prior service cost
Net retirement benefit obligation
Prepaid pension costAccrued retirement benefits

2012(Thousands of
U.S. dollars)(Millions of yen)

¥ (33,456)
21,577(11,879)
4,779
17(7,083)3,168¥ (10,251)$ (407,057)
262,526(144,531)
58,146
207(86,178)
38,545$ (124,723)¥ (32,394)
21,204(11,190)
5,249
20(5,921)
3,158¥ (9,079)

The components of retirement benefit expenses for the years ended March 31, 2012 and2011 are outlined as follows:
2011

2012

2012

(Thousands of
U.S. dollars)(Millions of yen)

Service cost
Interest cost
Expected return on plan assets
Amortization:
Prior service cost
Actuarial loss
Retirement benefit expenses¥ 1,484
599(578)¥ 1,429593(536)$ 18,056
7,288(7,032)

3
1,162¥ 2,670

3
1,302¥ 2,791

36
14,138$ 32,486

The assumptions used in accounting for the defined benefit pension plans for the years
ended March 31, 2012 and 2011 were as follows:
Discount rate
Expected rate of return on plan assets

2012

2011

Principally 1.9%
Principally 3.0%

Principally 1.9%
Principally 3.0%

The following table sets forth the status of the multi-employer pension plan at March 31,
2011, the most recent date on which such data was available. The contribution ratio of theGroup to the multi-employer pension plan as of March 31, 2012 was 0.5%.
(Thousands of
U.S. dollars)(Millions of yen)

Plan assets at fair value
Benefit obligation used in the calculation ofpension financing
Difference¥

408,249$

4,967,137¥

454,863(46,614)$5,534,286(567,149)

10. Income Taxes
Income taxes applicable to the Company and its domestic consolidated subsidiaries consistof corporation, inhabitants’ and enterprise taxes. The statutory tax rate in Japan for theyears ended March 31, 2012 and 2011 was, in the aggregate, approximately 40.6%.
The effective tax rates reflected in the accompanying consolidated statements ofincome for the years ended March 31, 2012 and 2011 differed from the above statutory tax
rate for the following reasons:21
Annual Report 2012 Nippon Shokubai Co., Ltd.

31

Statutory tax rate
Effect of:Valuation allowance
Different tax rate applicable to income of subsidiaries
Tax credit for research and development costs
Equity in earnings of an unconsolidated subsidiary and affiliates
Foreign tax credit
Decrease in deferred income tax assets resulting from change in thestatutory tax rates
Other, net
Effective tax rates

2012

2011

40.6 %

40.6 %

(1.3)
(2.8)
(2.9)
(2.9)
(0.1)

(5.5)
(2.4)
(3.9)
(3.1)
(0.1)

2.7
1.6
34.9 %–
4.0
29.6 %

Adjustment of deferred tax assets and liabilities due to change in the corporate tax rates
Due to the promulgation on December 2, 2011, of the “Act for Partial Revision of
the Income Tax Act, etc., for the Purpose of Creating a Taxation System Responding toChanges in Economic and Social Structures” (Act No.114 of 2011) and the “Act on Special
Measures for Securing Financial Resources Necessary to Implement Measures for
Reconstruction following the Great East Japan Earthquake” (Act No.117 of 2011), theeffective statutory tax rate used to measure deferred income tax assets and liabilities in thefiscal year ended March 31, 2012 changed from 40.6% to 35.6% in stages.
As a result of this change, deferred income tax assets, net of deferred income tax
liabilities and net unrealized deferred loss on hedges decreased by ¥829 million ($10,086
thousand) and ¥0 million ($0 thousand), respectively, and income taxes-deferred and net
unrealized holding gain on securities increased by ¥911 million ($11,084 thousand) and ¥82
million ($998 thousand), respectively, as of and for the year ended March 31, 2012.
Deferred income taxes reflect the net tax effect of the temporary differences between
the carrying amounts of the assets and liabilities calculated for financial reporting purposes
and the corresponding tax bases reported for income tax purposes. The significant
components of the deferred tax assets and liabilities of the Company and its consolidated
subsidiaries at March 31, 2012 and 2011 are summarized as follows:
2011

2012

(Millions of yen)

Deferred tax assets:
Depreciation and amortization (including
loss on impairment)
Accrued retirement benefits for employees
Tax loss carryforwards
Intercompany profit on inventories and property, plantand equipment
Accrued bonuses to employees
Loss on impairment of land
Reserve for periodic repairs
Impairment of investments in securities and other
Other
Gross deferred tax assets
Less: Valuation allowance
Total deferred tax assets
Deferred tax liabilities:
Equity in earnings of an overseas affiliate
Deferred capital gain on property (in overseas
subsidiaries)
Depreciation and amortization
Reserve for depreciation for tax purposes
Other
Total deferred tax liabilities
Net deferred tax assets

¥

¥

2012

(Thousands of
U.S. dollars)

3,177
2,580
2,071

¥ 2,651
2,456
2,232

1,333
1,112
1,107
896
727
1,286
14,289(3,952)
10,337

978
1,099
1,265
1,050
840
736
13,307(4,278)
9,029

16,21813,53013,46910,902
8,845
15,646
173,853(48,083)
125,770

(908)

(896)

(11,048)

(328)
(277)
(1)
(713)
(2,227)
8,110

(372)
(317)
(3)
(501)
(2,089)6,940(3,991)(3,370)(12)(8,675)(27,096)$ 98,674¥$

38,654
31,391
25,19822

32

Nippon Shokubai Co., Ltd. Annual Report 2012

11. Shareholders’ Equity
The Corporation Law of Japan (the “Law”) provides that an amount equal to 10% of theamount to be disbursed as distributions of capital surplus (other than the capital reserve) andretained earnings (other than the legal reserve) be transferred to the capital reserve and thelegal reserve, respectively, until the sum of the capital reserve and the legal reserve equals
25% of the capital stock account. Such distributions can be made at any time by resolutionof the shareholders, or by the Board of Directors if certain conditions are met.
Retained earnings include the legal reserve provided in accordance with theprovisions of the Law. The legal reserve of the Company included in retained earnings
amounted to ¥3,920 million ($47,694 thousand) and ¥3,920 million at March 31, 2012 and2011, respectively.
Common stock and treasury stock
Movements in shares of common stock in issue and treasury stock during the years ended
March 31, 2012 and 2011 are summarized as follows:
2012

Common stock
Treasury stock

April 1, 2011

212,000
8,992

Number of shares(Thousands)

Increase–
9

Decrease

March 31, 2012

8,000
8,000

204,000
1,001

2011
Number of shares(Thousands)

Common stock
Treasury stock

April 1, 2010

Increase

Decrease

March 31, 2011

187,000
8,976

25,00017–
1212,000
8,992

12. Research and Development Costs
Research and development costs included in cost of sales and selling, general andadministrative expenses for the years ended March 31, 2012 and 2011 totaled ¥11,938
million ($145,249 thousand) and ¥11,246 million, respectively.
13. Gain on Insurance Claims
During the year ended March 31, 2012, a domestic consolidated subsidiary received
insurance proceeds related to a loss suffered due to the Great East Japan Earthquake in theamount of ¥716 million ($8,711 thousand) and an overseas consolidated subsidiary received
insurance proceeds related to a loss suffered due to fire at a factory in the amount of ¥389
million ($4,733 thousand).
During the year ended March 31, 2011, an overseas consolidated subsidiary received
insurance proceeds related to a loss suffered due to fire at a factory in the amount of ¥1,161
million.

23
Annual Report 2012 Nippon Shokubai Co., Ltd.

33

14. Other Comprehensive Loss
The following table presents reclassification adjustments and tax effects of components ofother comprehensive income (loss) for the year ended March 31, 2012:

Unrealized holding loss on securities:
Amount arising during the year
Reclassification adjustments
Before tax effects
Tax effects
Net unrealized holding loss on securities
Deferred gain on hedges:
Amount arising during the year
Tax effects
Net deferred gain on hedges
Translation adjustments:
Amount arising during the year
Other comprehensive loss of equity method affiliates
attributable to the Company:
Amount arising during the year
Total other comprehensive loss

2012

2012

(Millions of yen)(Thousands of
U.S. dollars)¥ (1,576)(6)(1,582)580(1,002)$(19,175)(73)(19,248)
7,057(12,191)

2
(1)
1

24
(12)
12

(1,544)(18,786)(365)¥ (2,910)$(4,441)(35,406)

15. Supplemental Information to Consolidated Statements of Cash Flows
During the year ended March 31, 2012, the Company acquired shares of Nihon Polymer
Industries Co., Ltd. and included it in the scope of consolidation. Assets acquired andliabilities assumed of this subsidiary at the date of commencement of consolidation,acquisition cost of shares and proceeds from purchase of shares are summarized as follows:

Current assets
Property, plant and equipment
Negative goodwill
Current liabilities
Long-term liabilities
Minority interests
Acquisition cost of shares the Company purchased previously
Acquisition cost of shares of Nihon Polymer Industries Co., Ltd.
Cash and cash equivalents
Proceeds from purchase of investments Nihon Polymer Industries Co.,
Ltd.

2012

2012

(Millions of yen)(Thousands of
U.S. dollars)¥ 4,4211,671(8)(3,586)
(721)
(713)
(893)
171
353

$ 53,790
20,331(97)(43,631)(8,772)(8,675)(10,865)
2,081
4,295

¥

$

182

2,214

16. Leases
The following pro forma amounts represent the acquisition cost, accumulated depreciationand net book value of property leased to the Company and its domestic consolidated
subsidiaries at March 31, 2012 and 2011 which would have been reflected in theaccompanying consolidated balance sheets if finance leases, other than those which transfer
the ownership of the leased assets to the Company or its domestic consolidated subsidiaries,that started on or before March 31, 2008 (which are currently accounted for as operatingleases) had been capitalized:

24

34

Nippon Shokubai Co., Ltd. Annual Report 2012

2011

2012

2012
(Thousands of
U.S. dollars)(Millions of yen)Equipment and software:
Acquisition costs
Accumulated
depreciation/amortization
Net book value

¥ 640

¥ 782

$ 7,787

(313)
¥ 327

(361)
¥ 421

(3,808)$ 3,979

Lease payments of the Company and its domestic consolidated subsidiaries relating tofinance leases amounted to ¥94 million ($1,144 thousand) and ¥126 million for the years
ended March 31, 2012 and 2011, respectively. Depreciation on these leased assets
calculated by the straight-line method would have amounted to ¥94 million ($1,144
thousand) and ¥126 million for the years ended March 31, 2012 and 2011, respectively, if it
had been reflected in the accompanying consolidated balance sheets.
Future minimum lease payments (including the interest portion thereon) subsequent
to March 31, 2012 under finance lease transactions, other than those which transfer theownership of the leased assets to the Company or its domestic consolidated subsidiaries, thatwere entered into on or before March 31, 2008 are summarized as follows:(Millions of yen)

Year ending March 31,

20132014 and thereafter

¥

66
261
¥ 327

(Thousands of
U.S. dollars)

$

803
3,176
$ 3,979

17. Contingent Liabilities
At March 31, 2012, the Company and one consolidated subsidiary were contingently liable
as guarantors of indebtedness of an affiliate in the aggregate amount of ¥1,808 million($21,998 thousand).
In addition, at March 31, 2012, two consolidated subsidiaries had contingent
liabilities arising from notes discounted with banks and notes endorsed in the aggregate
amount of ¥549 million ($6,680 thousand).
18. Amounts per Share

2011

2012
(Yen)

Net income
Cash dividends
Net assets¥

104.7122.00
1,006.48

2012(U.S. dollars)¥

110.3022.00
938.67

$

1.27
0.27
12.25

Net income per share has been computed based on the net income available to shareholdersof common stock and the weighted-average number of shares of common stock outstanding
during the year. Diluted net income per share has not been presented for the years ended
March 31, 2012 and 2011 since neither the Company nor any of the consolidated
subsidiaries had any potentially dilutive shares at March 31, 2012 and 2011.
The amounts per share of net assets have been computed based on the number ofshares of common stock outstanding at the year end.
Cash dividends per share represent the cash dividends declared as applicable to therespective years together with the interim cash dividends paid.

25
Annual Report 2012 Nippon Shokubai Co., Ltd.

35

The financial data used in the computation of net income per share for the years ended
March 31, 2012 and 2011 is summarized as follows:
2011

2012
Net income
Deductions from net income
Adjusted net income available toshareholders of common stock
Weighted-average number of shares ofcommon stock outstanding during the year
(thousands of shares)(Millions of yen)

2012
(Thousands of
U.S. dollars)¥

21,257–¥

21,119–¥21,257¥

21,119$ 258,632

191,476

203,303

203,003$ 258,632–

19. Derivatives(1) Derivative transactions to which hedge accounting is not applied
Derivative transaction to which hedge accounting is not applied as of March 31, 2012 issummarized as follows:
Millions of yen
2012
Class
Over-the-countermarketTransaction

Contract value
Maturing within Maturing after
one year
one year

Forward foreign
currency exchange
contracts:
Sell

Class
Over-the-countermarketTransaction
Forward foreign
currency exchange
contracts:
Sell

¥ 27

Fair value

¥ –

¥ (0)

Thousands of U.S. dollars
2012
Contract value
Maturing within
Maturing after
one year
one year
Fair value

$

329

Loss

$ –

¥ (0)

Loss

$ (0)

$ (0)

(2) Derivative transactions to which hedge accounting is applied
The estimated fair value of the derivatives positions outstanding which qualify fordeferral hedge accounting as of March 31, 2012 and 2011 is summarized as follows:
Currency-related transactions
Millions of yen

Method of hedge
accounting
Deferral hedge

Allocation
methodTransaction

Major hedged item

2012
Contract value
Maturing within Maturing after
one year
one year

Fair
value

Forward foreign currency
exchange contracts:
Buy
Forward foreign currency
exchange contracts:
Sell
Buy

Accounts
tradepayable,Accounts
trade
Accounts
trade

receivable,
payable,

¥

56

¥ 37

¥ (3)

8,278

–

(*)

19

–

(*)
26

36

Nippon Shokubai Co., Ltd. Annual Report 2012

Millions of yen

Method of hedge
accounting
Deferral hedge

Allocation
methodTransaction

Major hedged item

2011
Contract value
Maturing within Maturing after
one year
one year

Fair value

Forward foreign currency
exchange contracts:
Buy
Forward foreign currency
exchange contracts:
Sell
Buy

Accounts
tradepayable,Accounts
trade
Accounts
trade

receivable,¥

payable,

93

¥ 74

¥

(5)

9,590

–

(*)

19

–

(*)

Thousands of U.S. dollars

Method of hedge
accounting
Deferral hedge

Allocation
methodTransaction
Forward foreign currency
exchange contracts
Buy

Major hedged item

2012
Contract value
Maturing within Maturing after
one year
one yearAccounts payable,
trade

$

Fair value

681

$ 450

$ (37)

100,718

–

(*)

231

–

(*)

Forward foreign currency
exchange contracts
Sell
Buy

Accounts
trade
Accounts
trade

receivable,
payable,Fair value of forward foreign currency exchange contracts is computed using prices
provided by counterparty financial institutions.
(*) Fair value of forward foreign currency exchange contracts under the allocation method is included inaccounts receivable, trade or accounts payable, trade.

Interest-rate related transactions
Millions of yen

2012
Method of hedge
accounting

Swap rates
applied tounderlying debt

Transaction
Interest rate swaps
Receive / floating and pay /fixed

Major hedged item
Long-term debt, including
current portion

Contract value
NotionalMore thanamountone year

¥ 100

¥–

Fair value(*)

Millions of yen

2011
Method of hedge
accounting

Swap rates
applied tounderlying debt

Transaction
Interest rate swaps
Receive / floating and pay /fixed

Major hedged item
Long-term debt, including
current portion

Contract value
NotionalMore thanamountone year

¥ 300

¥ 100

Fair value(*)

27
Annual Report 2012 Nippon Shokubai Co., Ltd.

37

Thousands of U.S. dollars

Method of hedge
accounting
Swap rates
applied tounderlying debt

Transaction
Interest rate swaps
Receive / floating and pay /fixed

Major hedged item
Long-term debt, including
current portion

2012
Contract value
NotionalMore thanamountone year$ 1,217$–

Fair value(*)(*) Because interest rate swap agreements are accounted for by applying swap rates to underlying
long-term debt, their fair value is included in that of the long-term debt disclosed in Note 4.

20.
Segment Information(1) Outline of reporting segments
The Group’s reporting segments are divisions of the Group for which separate financial
information is available, and whose operating results are reviewed regularly by the
Board of Directors meeting of the Company in order to allocate management resources
and assess performance of operations.
The Group’s main business lines are divided based on similarities of function andnature and the Company prepares the comprehensive strategy and conducts the businessactivities corresponding to the products handled by each business line.
Accordingly, the Group has three reporting segments based on product family: Basicchemicals, Functional chemicals, and Environment and catalysis.
Basic chemicals:
Acrylic acids, acrylic ester, ethylene oxides, ethylene glycols, ethanolamine,
higher-alcohol and glycol ether
Functional chemicals:Superabsorbent polymers, pharmaceutical intermediates, polymer for concrete
admixture, electronic and information materials, iodine, maleic anhydride, resins foradhesives & paints, plastic molded products and process adhesive products
Environment & catalysts:
Automotive catalysts, De-NOx catalysts, dioxin decomposition catalysts, industrial
catalysts, exhaust gas treatment equipment and fuel cell material(2) Calculation methods used for sales, income or loss, assets, and other items on eachreporting segment.
The accounting policies of the segments are substantially the same as those described in
the significant accounting policies in Note 1. Intersegment sales and transfers arerecorded at the same prices used in transactions with third parties.

38

28
Nippon Shokubai Co., Ltd. Annual Report 2012

(3) Information as to sales, income or loss, assets, and other items on each reporting
segment
The segment information of the Company and its consolidated subsidiaries for the years
ended March 31, 2012 and 2011 is outlined as follows:Year ended March 31, 2012
Basic
chemicals

Functional
chemicals

Environmentand catalysts

Total

Adjustments
andeliminations

Consolidated(Millions of yen)
Sales and operating
income:Sales to third parties¥

136,562

Intragroup sales andtransfers
Net sales
Segment income:Segment assets:
Other items:
Depreciation andamortization
Amortization of
goodwill
Increases in property,
plant and equipment
and other assets¥

160,762¥

23,380¥320,704¥–¥

320,704

35,337

1,611

1,880

38,828(38,828)–

171,899

162,373

25,260359,532(38,828)

320,704¥

13,387
137,775¥

16,526
159,104¥

1,671
23,657¥31,584
320,536¥(484)
35,871¥

31,100356,407

¥

9,398

¥

7,554

¥

504

¥

17,456¥–¥

17,456

468

13

–

481

–

481

8,129

14,247

1,664

24,040–24,040Year ended March 31, 2011
Basic
chemicals

Functional
chemicals

Environmentand catalysts

Total

Adjustments
andeliminations

Consolidated(Millions of yen)
Sales and operating
income:Sales to third parties
Intragroup sales andtransfers
Net sales
Segment income:Segment assets:
Other items:
Depreciation andamortization
Amortization of goodwill
Increases in property,
plant and equipment andother assets¥

125,052¥

141,553¥

21,740¥288,345¥–¥288,345

28,730

1,664

1,717

32,111(32,111)–

153,782

143,21723,457

320,456(32,111)

288,345¥

13,986137,256¥

13,323
147,191¥

2,366
19,573¥29,675304,020¥138
25,312¥29,813329,332

¥

8,296
468

¥

7,576
2

¥

381
–

¥

16,253
470¥––¥16,253470–

15,225

5,036

9,664

525

15,22529

Annual Report 2012 Nippon Shokubai Co., Ltd.

39

Year ended March 31, 2012
Functional
chemicals

Basic chemicals

Environmentand catalysts

Adjustments
andeliminations

Total

Consolidated(Thousands of U.S. dollars)
Sales and operating
income:Sales to third
parties
Intragroup sales
and transfers
Net sales
Segment income:Segment assets:
Other items:
Depreciation andamortization
Amortization of
goodwill
Increases inproperty, plantand equipment
and other assets

Note:

$

1,661,540$

1,955,980$

284,463$

3,901,983$–$

3,901,983

429,943

19,601

22,874472,418(472,418)–

2,091,483

1,975,581

307,3374,374,401(472,418)

3,901,983$

162,879
1,676,299$

201,071
1,935,807$

20,331
287,833$

384,2813,899,939$(5,889)436,440$

378,392
4,336,379$

114,345$

91,909

$

6,132

$

212,386$–$

212,386

5,694

158

–

5,852

–

5,852

98,905

173,342

20,246292,493–

292,493

The adjustments in segment income are related to the elimination between inter segment transactions.
The adjustments in segment assets consist of inter segment elimination and the common properties of
the group. The common properties are the investments held by the Company, mainly cash and cash
equivalents, and investments in securities.
The amount of long-term prepaid expense and its amortized cost are included in increases in property,
plant and equipment and other assets.

Note:

4. Related information
Geographical information(1) Sales
Sales categorized by countries and regions based on locations of customers of theGroup for the years ended March 31, 2012 and 2011 are summarized as follows:
Millions of yen

2012
Japan
¥

175,316

Asia¥

60,308Europe¥Americas35,844¥29,944Other¥

19,292

Total¥

320,704

Millions of yen
2011

Japan
¥

153,096

Asia¥

57,774

Europe¥Americas38,504¥

27,146

Other¥

11,825

Total¥

288,345

Thousands of U.S. dollars
2012

Japan
$

2,133,058

Asia$

733,763

Europe$436,111

Americas$364,327

Other$

234,724

Total$“Asia” includes east and south-east Asia. “Americas” includes U.S.A. and Canada.
includes areas except for Asia, Europe, North America and Japan.

3,901,983“Other”(2) Property, plant and equipment
Property, plant and equipment categorized by countries and regions as of March 31,
2012 and 2011 is summarized as follow:
30

40

Nippon Shokubai Co., Ltd. Annual Report 2012

Millions of yen

Japan
¥

101,635

Asia

2012
Europe

9,945

¥

¥

Other

3,928

¥

Total

7,218

¥

122,726

Millions of yen

Japan
¥

103,693

Asia

2011
Europe

4,627

¥

¥

Other

6,025

¥

Total

1,448

¥

115,793

Thousands of U.S. dollars
2012

Japan
$

1,236,586$

Asia

Europe121,000$

Other

47,792$

Total

87,821$ 1,493,199

5. Information of loss on impairment
Millions of yen

2012
Basic
chemicals
Loss on impairment¥–

Reporting segments
Functional
Environment andchemicals
catalysis¥–

Adjustments andeliminations

Total

¥ 280

¥ 280

¥–
Millions of yen

2011
Basic
chemicals
Loss on impairment¥–

Reporting segments
Functional
Environment andchemicals
catalysis¥ 571

Adjustments andeliminations

Total

¥–

¥ 571

Adjustments andeliminations

Total$ 3,407$ 3,407¥–
Thousands of U.S. dollars

2012
Basic
chemicals
Loss on impairment$–

Reporting segments
Functional
Environment andchemicals
catalysis$–$–

6. Information of amortization and remaining balance of goodwill
Millions of yen

Basicchemicals

2012
Reporting segments
Functional
Environmentchemicals
and catalysis

Adjustments
and eliminations

Total

Amortization during the
year

¥ 468

¥ 13

¥–

¥–

¥ 481

Remaining balance

¥ 468

¥

¥–

¥–

¥ 468

–

31
Annual Report 2012 Nippon Shokubai Co., Ltd.

41

Millions of yen

Basicchemicals
Amortization during theyear
Remaining balance

2011
Reporting segments
Functional
Environmentchemicals
and catalysis

Adjustments andeliminations

Total

¥ 468

¥ 2

¥–

¥–

¥

470

¥ 937

¥ –

¥–

¥–

¥

937

Thousands of U.S. dollars

Basicchemicals
Amortization during theyear
Remaining balance

$
$

5,694
5,694

2012
Reporting segments
Functional
Environmentchemicals
and catalysis
$ 158
$
–

Adjustments
and eliminations

$ –
$ –

$ –
$ –

Total
$
$

5,852
5,694

21. Related Party Transactions
Principal transactions between the Company and its related party for the years ended March
31, 2012 and 2011 are summarized as follows:
2011

2012
(Millions of yen)

ICT Co., Ltd.:Sales of finished goods
Purchases of raw materials¥ 16,515
14,265

2012(Thousands of
U.S. dollars)¥ 14,168
13,199$ 200,937
173,561

The prices for the above related party transactions were determined in reference to market
value.
The balances due from and to its related party at March 31, 2012 and 2011 were as
follows:
2011

2012

ICT Co., Ltd.:
Notes and accounts receivable
Notes and accounts payable(Millions of yen)

¥ 5,102
3,157¥ 5,388
3,480

2012

(Thousands of
U.S. dollars)$ 62,076
38,411The prices for the above related party transactions were determined in reference to market
value.
ICT Co., Ltd. is a related company in which the Company owns 50% of the shares ofcommon stock.
22. Subsequent Event
The following distribution of retained earnings of the Company, which has not beenreflected in the accompanying consolidated financial statements for the year ended March 31,
2012, was approved at a shareholders’ meeting held on June 21, 2012:

Cash dividends (¥11.00 = $0.134 per share)

42(Millions of yen)(Thousands of
U.S. dollars)¥ 2,233$ 27,169

32
Nippon Shokubai Co., Ltd. Annual Report 2012

Annual Report 2012 Nippon Shokubai Co., Ltd.

43

Corporate Data

(As of March 31, 2012)NIPPON SHOKUBAI CO., LTD.
Established		August 21, 1941

Common stock (Capital) ¥ 25,038 million
		Authorised: 636,000,000 Shares		Issued:204,000,000 Shares
Number of Employees
		

Stock Exchange Tokyo, Osaka, and ADR
Transfer Agent

Consolidated:
3,779
Non-consolidated: 1,944

Mitsubishi UFJ Trust andBanking Corporation
1-4-5 Marunouchi 1, Chiyodaku,
Tokyo 100-8212, Japan(As of March 31, 2012)

Organization Chart(Divisions)Internal Audit Office
Corporate Planning
General Administration & Personnel
Purchasing & Logistics
Finance & Accounting
Information Technology
Management Office
Investor & Public Relations
Responsible Care
Production
Engineering
Overseas Project
ResearchResearch Planning & Development
Ethylene Oxide Business
The Board

President
Corporate Managing
Committee

Acrylic Business
Fine & Performance
Chemicals Business
E & I Materials Business
Catalysis & Green Energy
Materials Business
Kawasaki Plant
Himeji Plant
Suita Plant

AuditorBoard of Auditors

44

Nippon Shokubai Co., Ltd. Annual Report 2012

Auditor Office

(As of March 31, 2012)

Situation of Consolidated Group

Domestic

Overseas

Basic Chemicals Business

Basic Chemicals BusinessSupply of products

SINO-JAPAN CHEMICAL CO., LTD

NIPPON NYUKAZAI CO., LTD.

Supply of products

Procurement of
raw materials

Supply of products
Licensing oftechnologies

Supply of products

PT. NIPPON SHOKUBAI INDONESIA
Singapore Acrylic Pte Ltd

SHINRITSU CO., LTD.
Supply of products

Supply of products
Procurement of
raw materials

Procurement of
products

Supply of technologies
and market information

Singapore Glacial Acrylic Pte. Ltd.
Supply of products

Functional Chemicals Business

NIPPON SHOKUBAI (ASIA) PTE LTDNIPPOH CHEMICALS CO., LTD.
NIPPON POLYESTER CO., LTD.

Supply of products

Functional Chemicals BusinessSupply of products
Supply of products

NA Industries, Inc.
Japan Composite Co., Ltd.
Supply of productsTokyo Fine Chemical CO., LTD.

Purchasing ofmaterials

Supply of products
Licensing oftechnologies

CHUGOKU KAKO CO., LTD.
NIHON JYORYU KOGYO CO., LTD

Rental of assets

American Acryl NA LLC
Supply of technologies
and market information

NIPPON POLYMER IND. Co., Ltd.

Environment and Catalyst BusinessAmerican Acryl L.P.

NIPPON SHOKUBAI EUROPE N.V.
NISSHOKU CHEMICAL INDUSTRY(ZHANGJIAGANG) CO., LTD.

Supply of products

ICT CO., LTD.

LG MMA Corporation
Procurement of
raw materials
Transportation of
products

Transportation of
products

Nisshoku Butsuryu Co., Ltd.

Consolidated subsidiaries
Equity method affiliates
Note: SHINRITSU CO., LTD. and Nisshoku Butsuryu Co., Ltd. belong to multiple segments.

Annual Report 2012 Nippon Shokubai Co., Ltd.

45

(As of March 31, 2012)

Consolidated Subsidiaries
Name
NIPPOH CHEMICALS CO., LTD.
		

Principle Business
Manufacture and sale of iodine, intermediates for API and agro-chemicals, andphoto/electro chemicals

CHUGOKU KAKO CO., LTD.

Manufacture and sale of adhesive tape and fine sphere particles

Nisshoku Butsuryu Co., Ltd.

Logistics of chemicals

NIPPON NYUKAZAI CO., LTD.

Manufacture and sale of surfactant and other chemicals

NIPPON POLYESTER CO., LTD.

Manufacture and sale of plastic products for construction, housing, and so on

Tokyo Fine Chemical CO., LTD.

Manufacture and sale of stabilizer of vinyl chloride resin and anti-freezeNIHON
JYORYU KOGYO CO., LTD		

Manufacture and sale of polycyclic aromatic hydrocarbons, (meth)acrylic acid derivatives andphoto/electro chemicals

SHINRITSU CO., LTD.

Sale of chemical products

NIPPON POLYMER IND. Co., Ltd.

Manufacture and sale of acrylic emulsions

NA		Industries, Inc.

Manufacture and sale of superabsorbent polymers, polymers for concrete admixture andwater soluble polymers

Singapore Acrylic Pte Ltd

Manufacture and sale of crude acrylic acid

Singapore Glacial Acrylic Pte. Ltd.

Manufacture and sale of glacial acrylic acid

PT.NIPPON SHOKUBAI INDONESIA

Sale of chemical products

NIPPON SHOKUBAI (ASIA) PTE LTD

Sale of chemical products

NIPPON SHOKUBAI EUROPE N.V.

Manufacture and sale of superabsorbent polymers

NISSHOKU CHEMICAL INDUSTRY(ZHANGJIAGANG) CO., LTD.

Manufacture and sale of superabsorbent polymers, polymers for concrete admixture(As of March 31, 2012)

Equity Method Affiliates
Name

Principle Business

ICT CO., LTD.

Manufacture, R&D and sale of automotive catalysts

Japan Composite Co., Ltd.

Manufacture and sale of unsaturated polyester resins and plastic molded materials

SINO-JAPAN CHEMICAL CO., LTD

Manufacture and sale of surfactant and other chemicals

LG MMA Corporation

Manufacture and sale of MAA and PMMA

American Acryl NA LLC
American Acryl L.P.

Manufacture and sale of acrylic acid46

Nippon Shokubai Co., Ltd. Annual Report 2012

Directory
HEAD OFFICERESEARCH CENTEROVERSEAS OFFICES

Osaka Office
Kogin Bldg., 4-1-1 Koraibashi, Chuo-ku,
Osaka 541-0043, Japan
Telephone : 81-6-6223-9111
Facsimile : 81-6-6201-3716

Advanced Materials Research Center(Suita, Himeji, Tsukuba)

Korea Office
4F Turbotek Building, 16-6 Sunae-Dong,
Bungdang-Gu, Sungnam-Si, GyeonggiDo, 463-825 Korea
Telephone : 82-31-718-9111
Facsimile : 82-31-718-9693

Tokyo Office
Hibiya Dai Bldg., 1-2-2 Uchisaiwai-cho,
Chiyoda-ku, Tokyo 100-0011, Japan
Telephone : 81-3-3506-7475
Facsimile : 81-3-3506-7598

GSC Catalysts Technology ResearchCenter(Suita, Himeji, Kawasaki, Tsukuba)

Strategic Technology Research Center(Suita, Himeji)

Superabsorbents Research Center(Himeji)

BUSINESS ESTABLISHMENTS
Kawasaki Plant and Kawasaki
Research Center
Chidori Plant
14-1 Chidori-cho, Kawasaki-ku, Kawasaki,
Kanagawa 210-0865, Japan
Ukishima Plant
10-12 Ukishima-cho, Kawasaki-ku,
Kawasaki, Kanagawa 210-0862, Japan

Fine & Specialty Chemicals ResearchCenter(Suita, Kawasaki)
E & I Materials Research Center(Suita, Himeji)
Process Technology Center(Himeji, Suita)

Himeji Plant and Himeji ResearchCenter992-1 Aza-Nishioki, Okihama, Aboshi-ku,
Himeji, Hyogo 671-1282, Japan
Suita Research Center and Suita Plant
5-8 Nishi Otabi-cho, Suita, Osaka
564-0034, Japan
Tsukuba Research Center
1-25-12 Kannondai, Tsukuba, Ibaraki
305-0856, Japan

Annual Report 2012 Nippon Shokubai Co., Ltd.

47

NIPPON SHOKUBAI CO., LTD.
Osaka Office
Kogin Bldg.
4-1-1 Koraibashi, Chuo-ku,
Osaka 541-0043, Japan
Telephone +81-6-6223-9111
Facsimile +81-6-6201-3716
Tokyo Office
Hibiya Dai Bldg.
1-2-2 Uchisaiwai-cho, Chiyoda-ku,
Tokyo 100-0011, Japan
Telephone +81-3-3506-7475
Facsimile +81-3-3506-7598
URL http://www.shokubai.co.jp