2nd Quarter of FY 2019
Financial Results Briefing

1 Outline of Consolidated Financial
Results for 2nd Quarter of FY 20192 Forecast of Consolidated Financial

Results for FY 20192019年11月8日
日本化学工業株式会社 4092
© 2019 Nippon Chemical Industrial Co., Ltd.

Notice: This document is an excerpt translation of the original Japanese
document and is only for reference purposes. In the event of any discrepancy
between this translated document and the original Japanese document,
the latter shall prevail.

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Outline of Consolidated Financial
Results for 2nd Quarter of FY 2019

© 2019 Nippon Chemical Industrial Co., Ltd.

Outline of Consolidated Financial Results（Millions of yen）

FY 2018

FY 2019

2Q

2Q

Net sales

17,88818,302413

2.3%

Operating profit

1,774

1,642▲ 132▲7.5%

Ordinary profit

1,851

1,694▲ 157▲8.5%

Profit1,310

1,121▲ 188▲14.4%© 2019 Nippon Chemical Industrial Co., Ltd.

ChangeChangerate

3Revenue by Business Segment（Millions of yen） Chromium
FY 2018

FY 2019

2Q

2Q

Changerate

Inorganic

Net sales

7,833

7,828

▲4▲0%

Chemicals

Operating profit

39240192%Specialty

Net sales

7,258

8,09883912%Chemicals

Operating profit

81697916320%

Leasing

Net sales

45045551%

Business

Operating profit

277265▲ 12▲4%Air-conditioning

Net sales

1,909

1,494▲ 415▲22%

Business

Operating profit

267▲27▲ 294 ▲110%

Net sales

437

425

▲ 12▲3%911222%

Net sales

17,88818,302413

2.3%

Operating profit

1,774

1,642

▲ 132

▲7.5%

OthersOperating profit

TOTAL

Compounds

Products for plating were sluggish

Silicates and Silica

Environmental products grew

Change© 2019 Nippon Chemical Industrial Co., Ltd.

Inorganic Phosphorus
Optical glass products were sluggish
Compounds
Phosphine Derivatives Products for overseas performed strongly

Agrochemicals

Products for overseas performed strongly

Battery Materials

Products for main customers performedsteadily

Electronic CeramicMaterials

Automotive and telecommunication
products performed strongly

Circuit Materials

Products for main customers performed
strongly

Leasing business

AEON TOWN Koriyama was extended

Air-conditioning
business

New designs and installations andmaintenance were sluggish

Book store operation

The book store business was sluggish

4Consolidated Balance Sheet(Assets)（Millions of yen）
【Assets】
Current assets
Cash and deposits
Notes and accounts receivable - trade
Inventories
Other
Non-current assets
Property, plant and equipment
Intangible assets
Investment securities
OtherTotal assets© 2019 Nippon Chemical Industrial Co., Ltd.

As of March 31,

As of September 30,

2019

2019

30,794
9,051
10,861
10,364518
34,70327,014
319
6,597
773
65,497

27,7385,854
11,535
9,602
747
35,911
28,530
399
6,160
822
63,650Change▲ 3,056▲ 3,196674
▲ 762
229
1,208
1,51580▲ 43649▲ 1,847

5Consolidated Balance Sheet(Liabilities and Net Assets)【Liabilities】
Current liabilities
Notes and accounts payable - trade
Short-term borrowings
Other
Non-current liabilities
Long-term borrowings
Retirement benefit liability
Deferred tax liabilities
Other
Total liabilities（Millions of yen）

As of March 31,

As of September 30,

2019

2019

Change18,925
4,617
9,143
5,165
11,073
5,422
1,299
2,118
2,234
29,99915,960
3,253
7,772
4,935
11,661
5,903
1,358
2,010
2,390
27,622▲ 2,965

32,5142,983
35,49765,49733,371
2,656
36,02863,650857▲ 1,364▲ 1,370▲ 23058848159▲ 108156▲ 2,377【Net assets】
Shareholders' equity
Accumulated other comprehensive income
Total net assets
Total liabilities and net assets© 2019 Nippon Chemical Industrial Co., Ltd.

▲ 327530▲ 1,8476

Consolidated Statements of Income(Cumulative)
Six months ended

Six months ended

September 30,2018

September 30,2019

17,888
13,697
2,416
1,774
210
134
1,851－
36
1,815
434
70
1,310

18,302
14,152
2,507
1,642
137
85
1,694
21
129
1,586445
191,121

Net Sales
Cost of sales
Selling, general and administrative expenses

Operating profit
Non-operating income
Non-operating expenses
Ordinary profit
Extraordinary income
Extraordinary losses
Profit before income taxes
Income taxes-current
Income taxes-defferrdProfit© 2019 Nippon Chemical Industrial Co., Ltd.

Change（Millions of yen）
Changerate

413

2.3%

455

3.3%

91

3.8%

▲ 132

▲7.5%

▲ 73
▲ 49
▲ 157

▲8.5%

93
▲ 229 ▲12.6%
11▲ 51▲ 188 ▲14.4%
7Consolidated Statements of Cash Flows（Millions of yen）

Ⅰ

Cash flows from operating activities
Profit before income taxes
Depreciation
Decrease (increase) in inventories
OtherⅡ Cash flows from investing activities
Capital expenditure
OtherⅢ

Cash flows from financing activities
Increase (decrease) in borrowings
Dividends paid
Other

Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period© 2019 Nippon Chemical Industrial Co., Ltd.

Six months ended

Six months ended

September 30, 2018

September 30, 2019

1,415
1,815
1,039
▲ 1,050▲ 389▲ 1,665▲ 1,599▲ 66▲ 797
▲ 530▲ 263▲42▲ 1,044
8,927
7,882

1,179
1,586
1,255761▲ 2,423▲ 3,219▲ 3,238
19▲ 1,157▲ 888▲ 263▲6▲0▲ 3,196
9,041
5,84482Forecast ofConsolidated Financial Resultsfor FY 2019
(There is no revision to the forecast for FY 2019)© 2019 Nippon Chemical Industrial Co., Ltd.

Forecast of Consolidated Financial Resultsfor FY 2019
（Millions of yen）

FY 2018

FY 2019

ActualForecast

ChangeChangerate

Net sales

36,15737,500

1,343

3.7%

Operating profit

3,084

3,100

160.5%

Ordinary profit

3,057

3,10043

1.4%

Profit

2,154

2,200

462.1%© 2019 Nippon Chemical Industrial Co., Ltd.

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Revenue by Business Segment for FY 2019
（Millions of yen） Chromium
FY 2018

FY 2019

ActualForecast

15,584

15,955

661

566

ChangeChangerate

Inorganic

Net sales

Chemicals

Operating profit

Specialty

Net sales

14,84915,840991

7%Chemicals

Operating profit

1,423

1,631

208

15%

Leasing

Net sales

893

905

121%

Business

Operating profit

548

590

42

Air-conditioning

Net sales

3,869

3,953

84

Business

Operating profit

350

291

▲ 59 ▲17%

Net sales

959847

Operating profit

8122

Net sales36,157

Operating profit

3,084

OthersTOTAL

371

Compounds

Perform steadily

Silicates and Silica

Likely to ship radioactive substanceabsorbents2%▲ 95 ▲14%

Inorganic Phosphorus Grow due to price revisions and sales
Compounds
expansion
Phosphine Derivatives Perform steadily
Agrochemicals

Perform steadily

8%

Battery Materials

Prices of raw material cobalt spike

2%

Electronic CeramicMaterials

Sales volume of products for MLCCs
increases▲ 112 ▲12%

Circuit Materials

Perform smoothly▲ 59 ▲73%

Leasing business

Perform steadily

37,500

1,343

3.7%

3,100

160.5%

Air-conditioningbusiness

Perform steadilyBook store operation

Sales decrease due to industry slump© 2019 Nippon Chemical Industrial Co., Ltd.

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Investments and Depreciation and Amortization
100Investments（Hundreds of millions of yen）

c

26307320

Main Investments for FY 201910The business performance of electronic
ceramic materials will remain strong

0Continue to invest in growth products
in a concentrated manner

Depreciation and amortizaion

80 c20196022464026

2220c

Invest aggressively without losing growth
opportunities

0FY 2016

FY 2017

FY 2018

FY 2019
forecast

Recent main investments
ProductUse

Organic
electronicmaterials

Leading-edgeorganic electronicmaterials

Electronic
ceramic
materials

MLCC materials

Plant

Background and description

Value

Fukushima 2

Arrange for the construction of a new plant to meet therising needs for leading-edge organic materials.
Aim to double sales of organic electronic materials business.

2.0 billion
yen

Fukushima 1

Add a new production line.
Expand production capacity by 10%.

1.0 billion
yen

Aichi
orTokuyama

Cater to soaring MLCC demand stemming from a shift to EV
cars as well as the installation of 5G base stations.
Considering arranging for a new plant building to beconstructed in Aichi or Tokuyama as a BCP measure.

Underconsideration© 2019 Nippon Chemical Industrial Co., Ltd.

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Disclaimer- Earnings forecasts and business plans presented in thismaterial are those prepared by the Company, based on various
assumptions from information obtainable on the date of releaseof the document. It should be noted that these forecasts andplans are not intended to neither promise nor guarantee theachievement of the planned figures or measures presentedherein.

© 2019 Nippon Chemical Industrial Co., Ltd.

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