Member of Financial Accounting Standards Foundation

Financial Results for the 1st Nine-Month Period of
the Fiscal Year Ending March 31, 2010
February 5, 2010
Listed stock exchanges: Tokyo Stock Exchange, Osaka Securities Exchange
Company name: Unitika Ltd.
Code number: 3103
URL: http://www.unitika.co.jp/e/home.htm
Representative: Kenji Yasue, President and Chief Executive Officer
Contact: Shoji Ishikawa, General Manager of Accounting Department
Expected submission of quarterly report: February 12, 2010
Expected commencement date for paying dividend: –TEL: +81-6-6281-5721(Figures rounded to nearest million yen.)
1. Consolidated performance for 1st nine-month period of the fiscal year ending March 31, 2010 (April 1, 2009 to
December 31, 2009)(1) Consolidated performance (accumulation)(Percentages represent changes from same period in previous year.)Net sales

Operating income

Millions ofyen%

1st nine-month period of FY ending March 31, 2010

133,951

1st nine-month period of FY ended March 31, 2009

157,514

Ordinary income

Quarterly net
incomeMillions ofyen%Millions ofyen%Millions ofyen(15.0)

6,198

36.8

3,255

107.4

459





4,530



1,570



19



Quarterly net income
per share

Quarterly net income per share after
full dilution

Yen
0.97
0.04

1st nine-month period of FY ending March 31, 2010
1st nine-month period of FY ended March 31, 2009

%

Yen
-

(2) Consolidated financial situation
Total assets

1st nine-month period of FY ending March 31, 2010

FY ended March 31, 2009

Capital adequacy
ratio

Net assets

Millions of yen

Millions of yen

283,453
282,843

20,85519,746

Net assets per
share

%
6.1
5.7

Yen
36.14
33.88

(Reference) Shareholders’ equity 1st nine-month period of FY ending March 31, 2010: 17,184 million yen
Fiscal year ended March 31, 2009: 16,109 million yen
2. Dividend payment
Dividend per share
End of Q1

End of Q2

FY ended March 31, 2009
FY ending March 31, 2010

End of Q3

Yen
0.00

Yen
-

Year end
Yen

Annual

-

Yen
0.00

Yen
0.00

-

0.00

0.00

0.00

FY ending March 31, 2010 (forecast)(Note) Revision of dividend forecast for the current quarter: No
3. Forecast of consolidated performance for fiscal year ending March 31, 2010 (April 1, 2009 to March 31, 2010)(Percentages represent changes from same period in previous year.)Net sales%
182,000 (13.2)

Millions of yen

Fiscal year ending March 31, 2010

Operating income
Millions of yen

8,500

%
9.4

Ordinary income
Millions of yen

4,000(Note) Revision of forecast of consolidated performance for the current quarter: No

1

%
19.8

Net income
per share

Net income
Millions of yen

%

yen

3,500



7.36

Member of Financial Accounting Standards Foundation

4. Others(1) Changes in significant subsidiaries during the term (changes in specified subsidiaries accompanying change of scopeof consolidation): No(2) Adoption of simplified accounting method and special accounting practices for preparation of quarterly consolidated
financial statements: Yes(Note) For details, please refer to [Qualitative information and financial statements] “4. Others” on page 4.
(3) Changes in accounting principles, procedures and presentations for preparation of quarterly consolidated financial
statements (those included in “Changes in Important Matters for Preparation of Quarterly Consolidated Financial
Statements”)
 Changes associated with revision of accounting standards: Yes Other changes: No(Note) For details, please refer to [Qualitative information and financial statements] “4. Others” on page 4.
(4) Number of shares outstanding (Common stock) Number of shares outstanding at end of term (including treasury stock):
1st nine-month period of FY ending March 31, 2010 : 475,969,000 sharesFiscal year ended March 31, 2009
: 475,969,000 shares Number of treasury stocks at end of term
1st nine-month period of FY ending March 31, 2010 : 443,571 sharesFiscal year ended March 31, 2009
: 430,885 shares Average number of shares outstanding during the term (quarterly consolidated accumulated period)
1st nine-month period of FY ending March 31, 2010 : 475,530,620 shares
1st nine-month period of FY ended March 31, 2009 : 475,562,450 shares* Explanation on appropriate use of forecasts of performance and other special items
The forward-looking statements in this document concerning performance forecasting, etc., are based on currently
available information and assumptions considered reasonable by the company. Actual performance may differ
significantly from the forecast due to various factors.
Concerning the assumptions used as a basis for performance forecasting and points to note when using theperformance forecast, please refer to [Qualitative information and financial statements] “3. Qualitative information on theforecast of consolidated performance” on page 4.

2

Unitika Ltd. (3103)

Financial Results for the 1st Nine-Month Period of the Fiscal Year Ending March 31, 2010

[Qualitative information and financial statements]
1. Qualitative information on consolidated performance
In the first nine-month period of the current fiscal year ending March 31, 2010 (April 1, 2009 to December 31,2009), the outlook of the domestic economy remained uncertain, with stagnating capital expenditures, anemic
consumer spending, the yen’s appreciation and deepening deflation, although there were some visible signs of arecovery in business activity. In such an environment Unitika Group reported net sales of 133,951 million yen(down 15.0% year-on-year), operating income of 6,198 million yen (up 36.8% year-on-year), ordinary income of
3,255 million yen (up 107.4% year-on-year) and quarterly net income of 459 million yen (quarterly net income of
19 million yen in the same period last year). Although net sales declined due to sluggish sales, operating, ordinary
and net income increased due to an improvement of profitability through the implementation of restructuring
measures.
Here is a summary of business by segment.
[Polymers]
The film business as a whole remained steady, since demand for industrial-use film recovered mainly in theelectrical and electronics fields and profitability of overseas nylon film business improved, although the recoveryof packaging film sales slowed down. In the resin business, shipment to the automobile, electrical and electronics
fields was on a recovery path, but orders for polyarylate resins remained sluggish. Consequently, profitability of
the resin business didn’t improve. In the nonwoven fabrics business, shipment of spunbond fabrics maintained its
momentum for the daily-life materials-use and demand from the automobile-related field and roofing-use headed
for recovery. However, shipment of spun lace declined.
[Environmental Business/Advanced Materials]
In the environmental business, sales continued to decrease, because public demand-related businesses remained
weak, due to a decline in order volumes and intensified competition, and private capital expenditures diminished.
But profitability recovered thanks to the continuation of business restructuring efforts such as focusing on thewater treatment field. In the advanced materials business, shipment of activated carbon fiber was showing strong
growth mainly for filter use, but profitability of the glass fibers and IC cloth businesses deteriorated, since sales ofglass fibers were affected by declining demand in the building materials and civil engineering fields and theexports of IC cloth dropped for electronics board use. Shipment of glass beads stagnated particularly for reflective
materials use.
[Fibers & Textiles]
In the synthetic fiber business, sales of long and short-fiber polyester continued to be weak, since demand fromgeneral-cloth use was in the doldrums and there was no improvement in shipment for industrial use that had
declined due to the economic contraction. Sales of vinylon fiber as a whole, mainly used in the building material
field, remained lackluster due to slow recovery in the exports of products for cement reinforcing use. In the natural
fiber business, the uniform business showed some improvement in profitability, but the business environment as awhole was very tough. In addition, we have implemented the structural reform measure related to the Fibers andTextiles business according to the schedule. Unitika Trading Co., Ltd., consolidated and established in October
2009, has been making efforts to raise the efficiency of operations and improve its profitability.
[Health & Amenity, Others]
In the health & amenity business, orders for konjak ceramide, a functional dietary material of health food,remained strong. In the medical business, sales of catheter-related products were almost in line with the plan. In
other business, sales of condominiums remained strong.

2. Qualitative information on consolidated financial positions
Total assets increased by 609 million yen from the end of the previous fiscal year to 283,453 million yen, mainly
due to an increase in cash and deposits despite a decrease in inventories. Liabilities decreased by 499 million yen
from the end of the previous fiscal year to 262,598 million yen, mainly due to a decrease in notes and accounts
payable-trade and provision despite an increase in loans payable. Net assets increased by 1,108 million yen fromthe end of the previous fiscal year to 20,855 million yen, mainly due to an increase in both retained earnings
resulting from net income during the period and foreign currency translation adjustments.
Here is a summary of the cash flow situation.
(Cash flow from operating activities)
Net cash provided by operating activities amounted to 6,837 million yen (net cash of 2,709 million yen used during
the same period last year) due to a decrease in cash inflow—the total of net income before income taxes anddepreciation and amortization—and inventories during the first nine-month period of the fiscal year ending March
31, 2010.

-3-

Unitika Ltd. (3103)

Financial Results for the 1st Nine-Month Period of the Fiscal Year Ending March 31, 2010

(Cash flow from investment activities)
Net cash used in investment activities amounted to 2,320 million yen (net cash of 5,723 million yen used during
the same period last year) due to capital expenditures of 2,877 million yen in the first nine-month period of the
fiscal year ending March 31, 2010.
(Cash flow from financing activities)
Net cash provided by financing activities amounted to 6,820 million yen (net cash of 11,209 million yen provided
in the same period last year) due to an increase in loans payable during the first nine-month period of the fiscal
year ending March 31, 2010.
As a result, cash and cash equivalents at the end of the first nine-month period of the fiscal year ending March 31,
2010 increased by 11,719 million yen from the end of the previous fiscal year to 20,995 million yen.

3. Qualitative information on the forecast of consolidated performance
Since the performance for the first nine-month period of the fiscal year ending March 31, 2010 was almost in linewith the plan, the company maintains its full-year forecast of consolidated performance announced on May 15,
2009 unchanged.

4. Others(1) Changes in significant subsidiaries during the term (changes in specified subsidiaries accompanying change ofscope of consolidation):
Not applicable(2) Adoption of simplified accounting method and special accounting practices for preparation of quarterly
consolidated financial statements:
In computing corporate income taxes, some consolidated subsidiaries took only major items into account interms of additions and deductions for the income and tax credits.
(3) Changes in accounting principles, procedures and presentations for preparation of quarterly consolidated
financial statements
 For calculating revenues and costs of construction contracts, the Company formerly applied thepercentage-of-completion method to projects with a contract value of 50 million yen or more as well as aconstruction period of more than one year, and applied the completed-contract method to other construction
contracts. Effective from the first quarter of the fiscal year ending March 31, 2010, the Company has adopted
the Accounting Standard for Construction Contracts (Accounting Standards Board of Japan Statement No.15,
issued on December 27, 2007) and the Guidance on Accounting Standard for Construction Contracts(Accounting Standards Board of Japan Guidance No. 18, issued on December 27, 2007). Thus, thepercentage-of-completion method has been applied to construction contracts that commenced in the firstquarter of the fiscal year for which the percentage of progress by the end of the first nine-month period of the
fiscal year can be estimated with reasonable accuracy (the estimated percentage of completion shall be basedon the ratio of the cost incurred to the estimated total cost). The completed-contract method has been applied
to other construction contracts.
Consequently, net sales increased by 857 million yen in the first nine-month period of the fiscal year ending
March 2010, while operating income, ordinary income and quarterly net income before income taxes eachincreased by 187 million yen.
(Additional information)
 Regarding contract constructions at the end of the first quarter, the Company recorded a provision for losses
on construction contracts from the first quarter of the fiscal year, because losses were anticipated in the future
and whose amounts could be reasonably estimated.
Consequently, operating income, ordinary income and net income before income taxes each decreased by fivemillion yen.
(4) Critical events, etc., regarding the assumption of a going concern
Since the Unitika Group’s net assets amounted to 19,746 million yen in the previous consolidated fiscal year, theCompany was in violation of a restrictive financial covenant regarding the long-term loans of 20,000 million yen.
However, management does not consider that there will be critical uncertainties regarding the assumption of agoing concern, since the Company will implement the following measures in accordance with Reform 2011, its
new medium-term three-year management plan, which was approved by a meeting of the board of directors heldon March 19, 2009.
 In order to bring about radical change in earnings, the Company will promote structural reform, which consistsof measures for improving the business structure of money-losing and unprofitable businesses and reducing
fixed costs.
 Management will concentrate the Company’s resources on growth areas and promote a growth strategy to
improve and strengthen its business by positioning functional materials such as polymers and functional
components as a core business.
-4-

Unitika Ltd. (3103)

Financial Results for the 1st Nine-Month Period of the Fiscal Year Ending March 31, 2010

The Company aims to post ordinary income of around 10,000 million yen in the final year of the medium-term
management plan by implementing the above measures.
Regarding 17,000 million yen (outstanding balance of 15,850 million yen at the end of the first nine-month
period of the fiscal year ending March 31, 2010) out of the above long-term loan agreement, a revised agreement
was concluded in September 2009 and the content of the financial covenant has been revised. At the end of thefirst six-month period of the fiscal year ending March 31, 2010, the Company did not violate its restrictive
financial covenant regarding the said long-term loan agreement. This remains unchanged in the first nine-month
period of the fiscal year ending March 31, 2010.
Meanwhile, regarding a restrictive financial covenant in the long-term loan agreement for 3,000 million yen(outstanding balance of 1,500 million yen at the end of the first nine-month period of the fiscal year ending
March 31, 2010), as a result of each financial institution’s decision an agreement was established to refrain fromexercising the right of claim acceleration of the loan maturity. This remains unchanged in the first nine-month
period of the fiscal year ending March 31, 2010.

-5-

Unitika Ltd. (3103)

Financial Results for the 1st Nine-Month Period of the Fiscal Year Ending March 31, 2010

5. Quarterly financial statements(1) Consolidated quarterly balance sheets
End of 1st nine-month period of
FY ending March 2010
(December 31, 2009)(Unit: Millions of yen)
Condensed consolidatedbalance sheet for previous FY(March 31, 2009)

21,04138,37831,506
17,742
3,925
6,240
(133)
118,700

9,331
36,981
38,592
18,306
4,427
7,574
(142)
115,070

104,448
51,113
155,561

104,683
53,653
158,337

112
655
767

177
682
859

8,983
(559)
8,423
164,753
283,453

10,155(1,579)8,576
167,773282,843

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Land
Other (net value)
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets-6-Unitika Ltd. (3103)

Financial Results for the 1st Nine-Month Period of the Fiscal Year Ending March 31, 2010

End of 1st nine-month period of
FY ending March 2010
(December 31, 2009)(Unit: Millions of yen)
Condensed consolidatedbalance sheet for previous FY(March 31, 2009)

23,56578,00632,466
400
280
370
5
19

26,52080,811
32,714
400
592
712
53

1,674
12,034
148,822

3,675
12,890158,370200
90,564
4,155
172
18,683
113,775
262,598400
80,418
4,742
342
18,824
104,727
263,097

23,798
1,661(7,311)(47)
18,10023,798
1,661(7,783)(46)
17,629

(393)

(498)

(3)
2,799
(3,318)(916)
3,670
20,855
283,453

2,875(3,909)(1,520)3,636
19,746
282,843

Liabilities
Current liabilities
Notes and accounts payable-trade
Short-term loans payable
Current portion of long-term loans payable
Current portion of bonds
Income taxes payable
Provision for bonuses
Provision for loss on construction contracts
Provision for warranties for completed
construction
Provision for business structure improvement
Other
Total current liabilities
Noncurrent liabilities
Bonds payable
Long-term loans payable
Provision for retirement benefits
Provision for directors’ retirement benefits
Other
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Valuation and translation adjustments
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation adjustment
Total valuation and translation adjustments
Minority interests
Total net assets
Total liabilities and net assets

-7-

12

Unitika Ltd. (3103)

Financial Results for the 1st Nine-Month Period of the Fiscal Year Ending March 31, 2010

(2) Consolidated quarterly statements of income(1st nine-month period ended December 31, 2009)

1st nine-month period ended
December 31, 2008

(Unit: Millions of yen)
1st nine-month period ended
December 31, 2009

(April 1, 2008 to December 31, 2008) (April 1, 2009 to December 31, 2009)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividends income
Gain on sales of investment securities
Equity in earnings of affiliates
Other
Total non-operating income
Non-operating expenses
Interest expenses
Other personal expenses
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of noncurrent assets
Compensation income for expropriation
Total extraordinary income
Extraordinary loss
Loss on disposal of noncurrent assets
Loss on valuation of investment securities
Business structure improvement expenses
Other
Total extraordinary loss
Income (loss) before income taxes and minority
interests
Income taxes-current
Income taxes-deferred
Total income taxes
Minority interests in income
Net income-8-

157,514
129,846
27,667
23,137
4,530

133,951
108,614
25,337
19,138
6,198

227
120
–
136
1,549
2,034

138
99
184
30
1,206
1,659

2,939
920
1,134
4,995
1,570

2,756
912
933
4,602
3,255

33
–
33

17
108
126

407
473
1,044
665
2,590
(987)

733
204
498
1,263
2,700
680

433
(1,551)(1,117)
110
19

333
(129)
203
17
459

Unitika Ltd. (3103)

Financial Results for the 1st Nine-Month Period of the Fiscal Year Ending March 31, 2010

(3) Consolidated quarterly statements of cash flows
1st nine-month period ended
December 31, 2008

(Unit: Millions of yen)
1st nine-month period ended
December 31, 2009

(April 1, 2008 to December 31, 2008) (April 1, 2009 to December 31, 2009)

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

(987)

680

Depreciation and amortization

5,457

5,017

Increase (decrease) in allowance for doubtful
accounts

303

273

Increase (decrease) in provision for businessstructure improvement–(2,001)

2,939

2,756

–

(184)

Decrease (increase) in notes and accounts
receivable-trade

5,706(1,348)Decrease (increase) in inventories(5,236)

8,223

Increase (decrease) in notes and accounts
payable-trade(6,088)(2,955)

Other(1,534)(673)

Sub-total

560

9,789

Interest and dividends income received

362

253

(2,637)(2,524)

(994)

(680)

(2,709)6,837

Decrease (increase) in time deposits

14

10

Purchase of investment securities

(20)

(23)

Interest expenses
Loss (gain) on sales of investment securities

Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities
Net cash provided by (used in) investing activities

1

368

Purchase of property, plant and equipment(5,686)(2,877)

Proceeds from sales of property, plant andequipment

283

268

Other

(315)

(67)

(5,723)(2,320)Net increase (decrease) in short-term loans payable

8,793(2,626)

Proceeds from long-term loans payable

49,49531,960

Repayment of long-term loans payable(45,585)(22,070)

Redemption of bonds

(200)

(200)

Cash dividends paid

(939)

(2)

Other

(354)

(240)

11,2096,820

Effect of exchange rate change on cash and cash
equivalents

(454)

383

Net increase (decrease) in cash and cash equivalents

2,321

11,719Cash and cash equivalents at beginning of period

13,2099,275

Cash and cash equivalents at end of period

15,53020,995

Proceeds from sales of investment securities

Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities

Net cash provided by (used in) financing activities-9-Unitika Ltd. (3103)

Financial Results for the 1st Nine-Month Period of the Fiscal Year Ending March 31, 2010

(4) Notes on going concern assumption
Not applicable(5) Segment information
Segment information by business
1st nine-month period ended December 31, 2008 (April 1, 2008 to December 31, 2008)
Health &Amenity,
Others(Millions ofyen)

Polymers(Millions ofyen)

Environmental
Business/Advanced
Materials(Millions of yen)

Fibers &Textiles(Millions ofyen)

Net sales(1) Net sales to outside customers

55,42020,87569,436

11,781

157,514

2,600

516

1,742

2,968

7,827


(7,827)

157,514(2) Inter-segment sales or transfers
Total

58,021

21,391

71,17914,750165,342(7,827)

157,514

5,669

300

(344)

638

6,264

(1,734)

4,530

Eliminationor corporate(Millions ofyen)Consolidated
total(Millions ofyen)Operating income (loss)

Total(Millions ofyen)

Elimination or Consolidated
corporate
total(Millions of(Millions of
yen)
yen)



1st nine-month period ended December 31, 2009 (April 1, 2009 to December 31, 2009)
Health &Amenity,
Others(Millions ofyen)

Polymers(Millionsof yen)Environmental
Business/Advanced
Materials(Millions of yen)

Fibers &Textiles(Millions ofyen)

Net sales(1) Net sales to outside customers

44,044

17,261

57,736

14,908133,951

1,606

52

243

1,952

3,853


(3,853)

133,951(2) Inter-segment sales or transfers
Total

45,65017,31357,97916,860137,804(3,853)

133,951

6,360

926

(834)

1,433

7,885

(1,686)

6,198

Operating income (loss)

Total(Millionsof yen)Segment information by geographic area
1st nine-month period ended December 31, 2008 (April 1, 2008 to December 31, 2008) and 1st nine-month
period ended December 31, 2009 (April 1, 2009 to December 31, 2009)
Segment information by geographic area is omitted since sales in Japan exceed 90% of total sales of all
segments.
Overseas sales
1st nine-month period ended December 31, 2008 (April 1, 2008 to December 31, 2008)
I. Overseas sales (Millions of yen)
23,911
II. Consolidated sales (Millions of yen)
157,514
III. Ratio of overseas sales to consolidated sales (%)
15.2(Note) There were no segments whose sales (excluding inter-segment sales or transfers) exceeded 10% of consolidated
sales.
1st nine-month period ended December 31, 2009 (April 1, 2009 to December 31, 2009)
I. Overseas sales (Millions of yen)
16,381
II. Consolidated sales (Millions of yen)
133,951
III. Ratio of overseas sales to consolidated sales (%)
12.2(Note) There were no segments whose sales (excluding inter-segment sales or transfers) exceeded 10% of consolidated
sales.
(6) Notes on significant changes in the amount of shareholders’ equity
Not applicable- 10 -