Member of Financial Accounting Standards Foundation

Financial Results for the 3rd Quarter of the Fiscal Year Ending March 31, 2020
February 7, 2020
Listed stock exchanges: Tokyo Stock Exchange
Company name: Unitika Ltd.
Code number: 3103
URL: https://www.unitika.co.jp/e/home.htm
Representative: Shuji Ueno, President and Chief Executive Officer
Contact: Masanori Onishi, General Manager of Accounting Department
TEL: +81-6-6281-5721
Expected submission of quarterly report: February 13, 2020
Expected commencement date for paying dividend: –Preparation of supplementary explanation documents for quarterly financial results: No
Holding of an analyst meeting for quarterly financial results: No(Figures rounded down to nearest million yen.)
1. Consolidated performance for 3rd quarter of fiscal year ending March 31, 2020 (April 1, 2019 to December 31, 2019)(1) Consolidated performance (accumulation)(Percentages represent changes from same period in previous year.)
Quarterly profit
Operating profit
Ordinary profit
attributable to owners ofparentNet sales
%
(7.2)
0.5

Millions of yen

Q3 of FY ending March 31, 2020
Q3 of FY ended March 31, 2019

(Note) Comprehensive income

88,764
95,694%(39.8)(27.4)

Millions of yen

3,850
6,393

%
(47.0)(31.7)

Millions of yen

2,917
5,507

Millions of yen(1,121)4,574%

(34.3)

Q3 of FY ending March 31, 2020: (1,161) million yen [%]Q3 of FY ended March 31, 2019: 3,973 million yen [(42.9%)]
Quarterly net income per share

Diluted quarterly net income per share
Yen

Yen(23.64)74.14

Q3 of FY ending March 31, 2020
Q3 of FY ended March 31, 2019


46.12

(2) Consolidated financial situation

Q3 of FY ending March 31, 2020
FY ended March 31, 2019

(Reference) Shareholders’ equity

Total assets

Net assets

Millions of yen
195,909
199,093

Millions of yen
39,86941,352

Capital adequacy ratio
%
18.6
19.0

3rd quarter of fiscal year ending March 31, 2020: 36,492 million yen
Fiscal year ended March 31, 2019: 37,873 million yen

2. Dividend payment
Dividends per share
End of Q1

End of Q2Yen

FY ended March 31, 2019
FY ending March 31, 2020

End of Q3
Yen
0.00



0.00



Year end
Yen

FY ending March 31, 2020 (forecast)

Total
Yen
0.00

Yen
0.00

0.00

0.00

(Note) Revision of the latest dividend forecast: None
(Note) The above Dividend payment refers to dividends paid to the holders of common stock. For details of dividend payment to the holders of classshares (unlisted), the rights of which are different from those of common stock, please refer to Dividend payment to the holders of class shares
mentioned below.

3. Forecast of consolidated performance for fiscal year ending March 31, 2020 (April 1, 2019 to March 31, 2020)(Percentages represent changes from same period in previous year.)Net sales

FY ending March 31, 2020

Operating profit

Millions of yen%

129,000(0.1)

Profit attributable toowners of parent

Ordinary profit

Net income per
share

%

Millions of yen%

Millions of yen%

Yen

6,500 (20.2)

5,200(26.7)

200(96.2)(2.11)

Millions of yen(Note) Revision of the latest forecasts of operational results: NoneMember of Financial Accounting Standards Foundation* Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries accompanying change of scope of
consolidation): No
New companies: ― (company name)
Excluded companies:  (company name)(2) Adoption of special accounting methods for preparing quarterly consolidated financial statements: No(3) Changes in accounting policies, changes in accounting estimates and retrospective restatement
 Changes in accounting policies due to revisions of accounting standards: No Changes of accounting policies other than the above: No Changes in accounting estimates: No
 Retrospective restatement: No(4) Number of shares outstanding (Common stock) Number of shares outstanding at end of term (including treasury stock):3rd quarter of the fiscal year ending March 31, 2020: 57,752,343 sharesFiscal year ended March 31, 2019: 57,752,343 shares Number of treasury stocks at end of term
3rd quarter of the fiscal year ending March 31, 2020: 94,252 sharesFiscal year ended March 31, 2019: 93,637 shares Average number of shares outstanding during the term (quarterly consolidated accumulated period)
3rd quarter of the fiscal year ending March 31, 2020: 57,658,375 shares
3rd quarter of the fiscal year ended March 31, 2019: 57,659,543 shares* This brief report of quarterly financial statements is not subject to audit procedures by a certified public accountant or an
independent auditor.
* Explanation on appropriate use of forecasts of performance and other special items
The forward-looking statements in this document concerning forecasting of performance etc. are based on currently available information andassumptions considered by the Company to be reasonable. Such statements are neither promises nor guarantees of future performance. The actual
performance may be significantly different from forecasts due to various factors. Concerning assumptions used as a basis for forecasting businessperformance and precautionary statements when using the forecast of performance, please refer to 1. Qualitative Information on Quarterly Results(3) Explanation of future forecast information including forecast of consolidated performance on page 3 of the attachment.

Member of Financial Accounting Standards Foundation

Dividend payment to the holders of class shares
The breakdown of dividends per share related to class shares, the rights of which are different from those of common stock, is asfollows:
Annual dividends
End of Q1
Class A share
FY ended March 31, 2019
FY ending March 31, 2020

Yen
—
—

End of Q2
Yen
0.00
0.00

End of Q3
Yen——

FY ending March 31, 2020 (forecast)Class B share
FY ended March 31, 2019
FY ending March 31, 2020
FY ending March 31, 2020 (forecast)

Yen
—
—

Yen
0.00
0.00

Yen
—
—

Year end

Total

Yen
12,000.00

Yen
12,000.00

12,000.00

12,000.00

Yen
23,740.00

Yen
23,740.00

23,740.00

23,740.00

Unitika Ltd. (3103)

Financial Results for 3rd Quarter of Fiscal Year Ending March 31, 2020

 Table of contents for the attachment
1. Qualitative Information on Quarterly Results ............................................................................................................2(1) Explanation of operational results........................................................................................................................2(2) Explanation of financial situation ........................................................................................................................3(3) Explanation of future forecast information including forecast of consolidated performance ..............................3
2. Quarterly Consolidated Financial Statements
and Major Notes to Consolidated Financial Statements ............................................................................................4(1) Consolidated quarterly balance sheets .................................................................................................................4(2) Consolidated quarterly statements of income andconsolidated quarterly statements of comprehensive income ..............................................................................6
Consolidated quarterly statements of income
Nine-month period ended December 31, 2019 ................................................................................................ 6
Consolidated quarterly statements of comprehensive income
Nine-month period ended December 31, 2019 ................................................................................................ 7(3) Notes on quarterly consolidated financial statements ..........................................................................................8(Notes on going concern assumption) ..................................................................................................................8(Notes on significant changes in shareholders’ equity) ........................................................................................8(Additional information) ......................................................................................................................................8(Segment information) .........................................................................................................................................9-1-

Unitika Ltd. (3103)

Financial Results for 3rd Quarter of Fiscal Year Ending March 31, 2020

1. Qualitative Information on Quarterly Results(1) Explanation of operational results
During the nine-month period of the consolidated fiscal year under review, the Japanese economy continued to
grow moderately, supported by solid capital investment and consumer spending in Japan as well as good
employment and income environment, despite the impact of natural disasters such as typhoons, a temporary
decrease in domestic demand following the consumption tax rate hike, and a slowdown in external demand.
Meanwhile, the outlook for the global economy remained unclear, although the U.S. economy continued to growstrongly. This was due to lingering economic stagnation in China as well as concern over a recurrence of the harshtrade dispute between the U.S. and China, and geopolitical risks such as unstable situations in the Middle East.
Under these circumstances, the Unitika Group endeavored to realize the three Gs (Growth, Global, andGovernance) promoted under the “G” round 20—to The Next Stage, its medium-term management plan.
Consequently, the Group reported net sales of 88,764 million yen (down 7.2% year on year), operating profit of
3,850 million yen (down 39.8% year on year), and ordinary profit of 2,917 million yen (down 47.0% year on year)
in the nine-month period of the consolidated fiscal year under review. Meanwhile, the Group posted 2,540 million
yen of provision for loss on litigation, as an extraordinary loss, resulting in loss attributable to owners of parent of
1,121 million yen in the nine-month period of the consolidated fiscal year under review (vs. profit attributable toowners of parent of 4,574 million yen in the previous year).
Here is an overview of the business results by segment.
[Polymers]
The Polymers business saw the occurrence of a fire at the Uji Plant in January 2019 affect production and sales of
the Films business and nylon products in the Plastics businesses.
In the Films business, the packaging sector saw the impact of the fire at the Uji Plant, and the slowdown indemand for some seasonal products because of unseasonable weather, including a delay in the end of the rainyseason and a mild winter. However, sales of high-value-added products, such as EMBLEM HG, a barrier nylon
film, continued to grow steadily in Japan and overseas. In the industrial sector, sales decreased due to thedeterioration of market conditions in the area of semiconductor applications both at home and abroad. Meanwhile,
sales of high-value-added products, such as Uni-amide, a heat-resistant thermoplastic polyamide film, increased
steadily in the first half of the year, but decreased in the second half. Sales of Uni-peel, a silicon-free mold release
PET film, expanded robustly.
In the Plastics business, profitability of nylon resins deteriorated due to the impact of the fire at the Uji Plant andrising costs. Furthermore, sales of U-Polymer, a polyarylate resin, faced an uphill battle due to a fall in demand forautomobile applications overseas and inventory adjustment for information terminal equipment applications. Salesof raw materials for other functional resins were also sluggish due to a decline in demand caused by the stagnationof the Chinese economy and a decrease in automobile production.
In the Non-woven Fabrics business, sales of polyester spunbond fabrics, in general, grew steadily for building
material applications, such as civil engineering, but were largely sluggish for other applications including
agriculture. THAI UNITIKA SPUNBOND CO., LTD. (TUSCO), a subsidiary in Thailand, saw its efforts toencourage customers to adopt products manufactured by its new machinery at the stage of design pay off, but
overall sales were sluggish due to a fall in demand for automobile-related applications. Meanwhile, sales of cotton
spunlace temporarily decreased in Japan due to the impact of inventory adjustment by business partners, but grewstrongly overseas for sanitary material applications.
Consequently, the Polymers business posted operating profit of 3,939 million yen (down 33.2% year on year) on
net sales of 42,738 million yen (down 9.4% year on year).
[Advanced Materials]
In the Glass Fibers business, the industrial materials sector saw sales of products for building applications, such as
smoke barriers, and sales for environment-related applications, grow steadily. In the electronic materials sector,
sales of IC cloth, especially high-value-added products, such as super thin products and materials with low
thermal expansion grew steadily, despite lingering weak semiconductor market recovery.
In the Glass Beads business, sales of products for industrial applications continued to be sluggish due to a fall indemand in the field of automotive and electronic components. However, demand for products for reflective
material applications and for road applications remained robust.
In the Activated Carbon Fibers business, sales for our mainstay water purifier applications, especially faucet
built-in water purifiers, continued to be strong and sales for industrial filter applications slightly recovered.
However, sales for VOC removal applications partially suffered from the impact of customers’ inventory
adjustment.
Consequently, the Advanced Materials business posted operating profit of 769 million yen (down 13.6% year onyear) on net sales of 9,836 million yen (up 3.3% year on year).

-2-

Unitika Ltd. (3103)

Financial Results for 3rd Quarter of Fiscal Year Ending March 31, 2020

[Fibers and Textiles]
In the Industrial Materials business, sales of polyester staple fibers grew strongly for daily product applications
and industrial material applications, but exports remained sluggish. Sales of ultra-high-strength polyester filament
yarns grew steadily for material applications, but decreased for civil engineering and building applications.
Furthermore, demand for fishery applications, in general, were weak.
In the Garments, Lifestyle Materials and Bedding business, sales continued to be sluggish in the sports clothing,
women’s clothing, and bedding sectors. Sales in the uniform sector, which had been robust chiefly for corporate
customers, decreased. Furthermore, in the Overseas business, sales of denim remained flat from the previous year.
Consequently, the Fibers and Textiles business posted an operating loss of 671 million yen (vs. operating loss of
121 million yen in the previous year) on net sales of 36,055 million yen (down 4.7% year on year).
[Others]
The Others category posted an operating loss of 181 million yen (operating loss of 237 million yen in the previousyear) on net sales of 133 million yen (down 88.6% year on year).
(2) Explanation of financial situation
Total assets decreased by 3,183 million yen from the end of the previous consolidated year to 195,909 million yen,mainly due to a decrease in notes and accounts receivable-trade. Liabilities fell by 1,700 million yen from the endof the previous consolidated year to 156,040 million yen. This was primarily due to a decline in notes andaccounts payable-trade despite the posting of provision for loss on litigation. Net assets fell by 1,483 million yen
from the end of the previous consolidated year to 39,869 million yen. This was mainly due to a decrease inretained earnings caused by the posting of loss attributable to owners of parent.
(3) Explanation of future forecast information including forecast of consolidated performance
The Unitika Group did not revise its full-year forecast of consolidated performance for the fiscal year ending
March 31, 2020 announced on November 8, 2019.

-3-

Unitika Ltd. (3103)

Financial Results for 3rd Quarter of Fiscal Year Ending March 31, 2020

2. Quarterly Consolidated Financial Statements and Major Notes to Consolidated Financial Statements(1) Consolidated quarterly balance sheets(Unit: Millions of yen)Previous consolidated
Q3 of FY ending March 2020
fiscal year
(December 31, 2019)(March 31, 2019)
AssetsCurrent assets
Cash and deposits
22,58020,006
Notes and accounts receivable-trade35,31632,566Inventories
29,63931,225
Other
2,416
2,580
Allowance for doubtful accounts
(61)
(55)
Total current assets
89,891
86,324Non-current assets
Property, plant and equipment
Machinery, equipment and vehicles, net
23,00222,859Land
65,62965,167
Other, net
14,235
15,183
Total property, plant and equipment
102,868
103,210Intangible assets
Other
1,927
1,766
Total intangible assets
1,927
1,766
Investments and other assets
Other
4,444
4,624
Allowance for doubtful accounts
(37)
(16)
Total investments and other assets
4,406
4,608
Total non-current assets
109,202109,585
Total assets
199,093
195,909-4-

Unitika Ltd. (3103)

Financial Results for 3rd Quarter of Fiscal Year Ending March 31, 2020

(Unit: Millions of yen)Previous consolidated
fiscal year
(March 31, 2019)
Liabilities
Current liabilities
Notes and accounts payable-trade
Short-term borrowings
Current portion of long-term borrowings
Income taxes payable
Provision for bonuses
A product repair reserve fund
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Provision for retirement benefits for directors(and other officers)
Provision for loss on litigation
Retirement benefit liability
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets-5-

Q3 of FY ending March 2020
(December 31, 2019)18,0562,430
99,993
589
1,648
72
8,743
131,534

14,8902,264
97,869136880
43
10,454
126,539

180

137

4

—

—
13,184
12,836
26,206
157,740

2,540
13,741
13,081
29,500156,040

100
13,21824,040(56)
37,302

100
13,21822,596(56)
35,858

363

486

(69)
6,412
(3,589)(2,545)571
3,479
41,352
199,093

(167)
6,412
(3,844)(2,253)633
3,377
39,869195,909

Unitika Ltd. (3103)

Financial Results for 3rd Quarter of Fiscal Year Ending March 31, 2020

(2) Consolidated quarterly statements of income and consolidated quarterly statements of comprehensive income(Consolidated quarterly statements of income)(Nine-month period ended December 31, 2019)(Unit: Millions of yen)
Nine-month period
Nine-month period
ended December 31, 2018
ended December 31, 2019
(April 1, 2018 to(April 1, 2019 to
December 31, 2018)
December 31, 2019)
95,694
88,764
Net sales
73,387
68,564
Cost of sales
22,307
20,200Gross profit
15,913
16,349Selling, general and administrative expenses
6,393
3,850
Operating profit
Non-operating income
3125Interest income
70
71
Dividend income
Share of profit of entities accounted for using equity
27
19
method97
93
Rent income
247
167
Other
474
376
Total non-operating income
Non-operating expenses
920
885
Interest expenses
440
423
Other
1,361
1,309
Total non-operating expenses
5,507
2,917
Ordinary profit
Extraordinary income
1974
Gain on sales of non-current assets—
0Gain on sales of investment securities
398—
Gain on liquidation of subsidiaries and associates
418
75
Total extraordinary income
Extraordinary losses
460
860
Loss on disposal of non-current assets—
42
Loss on valuation of investment securities—
2,540
Provision for loss on litigation
—
27
Other
460
3,471
Total extraordinary losses
5,465
(477)
Profit (loss) before income taxes
601
436
Income taxes-current
281
261
Income taxes-deferred
883
697
Total income taxes
4,582(1,175)
Profit (loss)
7(54)
Profit (loss) attributable to non-controlling interests
4,574(1,121)
Profit (loss) attributable to owners of parent-6-Unitika Ltd. (3103)

Financial Results for 3rd Quarter of Fiscal Year Ending March 31, 2020

(Consolidated quarterly statements of comprehensive income)(Nine-month period ended December 31, 2019)
Nine-month period ended
December 31, 2018
(April 1, 2018 to
December 31, 2018)
Profit (loss)
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans,
net of tax
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners ofparentComprehensive income attributable tonon-controlling interests-7-(Unit: Millions of yen)
Nine-month period ended
December 31, 2019
(April 1, 2019 to
December 31, 2019)

4,582(1,175)

(180)
(32)
(663)

123
(113)
(287)

267

291

(608)

13

3,973

(1,161)

3,978(1,059)

(4)

(102)

Unitika Ltd. (3103)

Financial Results for 3rd Quarter of Fiscal Year Ending March 31, 2020

(3) Notes on quarterly consolidated financial statements(Notes on going concern assumption)
Not applicable(Notes on significant changes in shareholders’ equity)
Not applicable(Additional information)
In a lawsuit filed by citizens of Toyohashi City, Aichi Prefecture (the “City”) who claimed that Unitika’s sale ofland for industrial use to a third party was a breach of the land transfer contract—the land was transferred by theCity to the Company in 1951—and requested the mayor of the City to demand damages against the Company (theCompany participated in the lawsuit as an assisting intervener), on February 8, 2018 the Nagoya District Court
ordered the mayor to request the Company to pay 6,300 million yen in damages and delinquency charges. On
February 20, 2018, the mayor appealed to the Nagoya High Court against the decision (the Company participatedin the lawsuit as an assisting intervener). On July 16, 2019, the Nagoya High Court sentenced the mayor to request
the Company to pay around 2,094 million yen in damages and delinquency charges. On July 29, 2019, the mayor
appealed to the Supreme Court against the judgment made by the court of second instance and petitioned for
acceptance of a final appeal. Meanwhile, the Company made reasonable estimates to calculate the amount basedon the judgment by the High Court and posted 2,540 million yen of provision for loss on litigation.

-8-

Unitika Ltd. (3103)

Financial Results for 3rd Quarter of Fiscal Year Ending March 31, 2020

(Segment information)[Segment Information]
I. Nine-month period ended December 31, 2018 (April 1, 2018 to December 31, 2018)
1. Information on net sales, income or loss by reportable segment(Unit: Millions of yen)
Reportable segment

Polymers

Advanced Fibers &Materials Textiles

Total

Other
(Note 1)

Total

Amount posted in
Consolidated
quarterly
Adjustment
statements of(Note 2)income(Note 3)

Net sales
Net sales to outside customers
Inter-segment sales or transfers

47,153
7,000

9,526
643

37,841
387

94,521
8,031

1,173
914

95,694
8,946—(8,946)

95,694—

Total

54,154

10,17038,228102,553

2,087 104,641(8,946)

95,694

Segment income (loss)
5,897
891
(121)
6,666
(237)
6,429
(35)
6,393
(Notes) 1. The Other segment includes business segments that are not included in the reporting segments, such as the design,
construction, and maintenance businesses of plant projects.
2. Adjustment of Segment income (loss) is attributable to the elimination of inter-segment transactions.
3. Segment income (loss) is adjusted with operating profit in quarterly consolidated statements of income.

II. Nine-month period ended December 31, 2019 (April 1, 2019 to December 31, 2019)
1. Information on net sales, income or loss by reportable segment(Unit: Millions of yen)
Reportable segment
Other(Note 1)

Total

Amount posted in
Consolidated
quarterly
Adjustment
statements of(Note 2)income(Note 3)Polymers

Advanced
Materials

Fibers &TextilesNet sales
Net sales to outside customers
Inter-segment sales or transfers

42,738
6,851

9,836
531

36,055385

88,630
7,769

133
18

88,764
7,787—(7,787)88,764—

Total

49,59010,36836,441

96,400151

96,551(7,787)88,764

Segment income (loss)
3,939
769
(671)
4,037
(181)
3,855
(5)
(Notes) 1. The Other segment includes business segments that are not included in reportable segments.
2. Adjustment of Segment income (loss) is attributable to the elimination of inter-segment transactions
3. Segment income (loss) is adjusted with operating profit in consolidated statements of income.

3,850

-9-

Total