Business Results for the Fiscal Year Ended
December 31, 2022 (Unaudited)

February 9, 2023
Kuraray Co., Ltd.

February 9, 2023
Kuraray Co., Ltd.

Consolidated Earnings Report for the Fiscal Year Ended December 31, 2022
Name of listed company:
Stock code:
Stock exchange listing:
URL:

Kuraray Co., Ltd.
3405
Tokyo Stock Exchange, Prime Market
https://www.kuraray.com/

Representative:
Title:
Name:

Representative Director and President
Hitoshi Kawahara

Contact:
Title:

Senior Manager, Corporate Communications Department, Corporate
Management Planning Office
Shinichi Takizawa+81-3-6701-1070

Name:
Tel:

Preparation of supplementary documentation for the earnings report: Yes
Holding of earnings results briefing: Yes (for securities analysts and institutional investors)(Millions of yen rounded down unless otherwise stated)

1. Consolidated Financial Results for the Fiscal Year Ended December 31, 2022
(January 1, 2022 to December 31, 2022)(1) Consolidated Operating Results(Percentage changes displayed for net sales, operating income, ordinary income and net income attributableto owners of the parent are comparisons with the previous fiscal year.)(Millions of yen)
Net Sales

Operating Income(%)

Fiscal 2022
Fiscal 2021

756,376
629,370―

16.2

Note: Comprehensive income:Net Income per
Share (Yen)
Fiscal 2022
Fiscal 2021

161.13108.32(%)

87,13972,256

For fiscal 2022:
For fiscal 2021:
Fully Diluted Net
Income per Share(Yen)
161.00108.23[Reference] Equity in earnings of affiliate:

Net Income
Attributable to Ownersof the Parent(%)―
54,307―37,262

Ordinary Income―

84,06068,765

63.0

―

(%)

73.0

¥113,371 million¥ 75,741 million

(―%)
(―%)

Return on Total
Assets (%)

Return on
Equity (%)
9.0
7.0

7.3
6.4

Operating
Income/Net Sales
(%)
11.5
11.5

For fiscal 2022: ¥271 million
For fiscal 2021: ¥261 million
Note: Due to the adoption of the “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29;
March 31, 2020) from January 1, 2022, the figures for fiscal 2022 reflect the application of the newly applied
accounting standard. Therefore, the rate of change from the previous year is not shown.

(2) Consolidated Financial Position(Millions of yen)
Total Assets

Net Assets

Equity Ratio (%)

Net Assets per Share(Yen)

Fiscal 2022

1,221,533

668,53452.9

1,932.37

Fiscal 2021

1,091,014

579,60251.3

1,627.84[Reference] Equity attributable to owners of the parent:

For fiscal 2022:¥646,750 million
For fiscal 2021:¥559,984 million
Note: Due to the adoption of the “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29;
March 31, 2020) from January 1, 2022, the figures for fiscal 2022 reflect the application of the newly applied
accounting standard.

(3) Consolidated Cash Flows(Millions of yen)
Cash Flows fromOperating Activities

Cash Flows from
Investing Activities

51,72778,221

Fiscal 2022
Fiscal 2021

Cash Flows from
Financing Activities(68,624)(65,595)(12,053)(47,447)

Cash and Cash
Equivalents at End of
Period127,616
151,487

2. Dividends(Yen)
Cash Dividends per ShareJun. 30
Sep. 30
Dec. 31

Record Date

Mar. 31AnnualFiscal 2021
Fiscal 2022
Fiscal 2023
(Forecast)

―
―

20.00
21.00

―
―

20.00
23.00

40.00
44.00

―

24.00

―

24.00

48.00

Total
Dividends
Paid(full year)(¥ million)
13,76014,726

Payout Ratio(consolidated)(%)

Dividends/Net
Assets(consolidated)
(%)

36.9
27.3

2.6
2.5

31.5

3. Forecasts of Consolidated Financial Results for the Fiscal Year Ending December
31, 2023 (January 1, 2023 to December 31, 2023)(Percentage changes displayed for net sales, operating income, ordinary income and net income attributableto owners of the parent are comparisons with the previous fiscal year.)(Millions of yen)
Net SalesInterim Period
Full Fiscal Year

400,000
830,000

Operating Income

(%)
11.7
9.7

36,00084,000

(%)
(5.5)
(3.6)

Ordinary Income

33,00079,000Net Income
Net Income
Attributable toper Share
Owners of the Parent
(Yen)
(%)
(%)
(12.9)
21,000(13.2)
62.74(6.0)
51,000(6.1)
152.38

[Reference](1) Changes in Important Subsidiaries during the Period (Changes in Special Subsidiaries
Involving Changes in the Scope of Consolidation)
Added: No companies
Excluded: No companies(2) Changes in Accounting Principles, Procedures and Presentation Methods in Connection with
the Preparation of Consolidated Financial Statements
1. Changes following revision of accounting standards: Yes
2. Changes besides 1. above: No
3. Changes in accounting estimates: No
4. Restatement: No(3) Number of Shares Issued and Outstanding (Common Shares)
1. Number of shares issued and outstanding (including treasury shares) as of the periodend:
As of December 31, 2022
354,863,603 shares
As of December 31, 2021
354,863,603 shares
2.

Number of treasury shares as of the period-end:
As of December 31, 2022
20,171,061 shares
As of December 31, 2021
10,858,263 shares

3.

Average number of shares for the period (cumulative):
As of December 31, 2022
337,050,748 shares
As of December 31, 2021
343,987,048 shares[Reference]
Summary of Unconsolidated Results
1. Unconsolidated Results for Fiscal 2022 (January 1, 2022 – December 31, 2022)(Percentages displayed for net sales, operating income, ordinary income and net income are comparisonswith the previous fiscal year.)(1) Unconsolidated Operating Results(Millions of yen)

Fiscal 2022
Fiscal 2021

Net Sales(Change)
253,982―
252,721
14.5
Net Income
per Share (Yen)

Operating Income(Change)
35,328―40,30044.1

Ordinary Income(Change)
39,151―
41,81537.2

Net Income(Change)
28,026―28,315
79.6

Fully Diluted
Net Income
per Share (Yen)
Fiscal 2022
83.15
83.09
Fiscal 2021
82.32
82.25
Note: Due to the adoption of the “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29; March 31,2020) from January 1, 2022, the figures for fiscal 2022 reflect the application of the newly applied accounting standard.

(2) Unconsolidated Financial Position(Millions of yen)
Shareholders’
Net Assets
Equity Ratio (%)
per Share (Yen)
1,010,196
405,32240.1
1,210.01
Fiscal 2022
968,040
402,99641.6
1,170.28
Fiscal 2021
[Reference] Shareholders’ equity:
For fiscal 2022: ¥404,981 million
For fiscal 2021: ¥402,581 million
Note: Due to the adoption of the “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29; March 31,2020) from January 1, 2022, the figures for fiscal 2022 reflect the application of the newly applied accounting standard.
Total Assets

Net Assets

Note: It is not required that this type of earnings report be audited.
Cautionary Statement with Respect to Forecasts of Consolidated Business Results(Cautionary note regarding forward-looking statements)
The results forecasts presented in this document are based upon currently available information andassumptions deemed rational. A variety of factors could cause actual results to differ materially from forecasts.
Please refer to “1. Qualitative Information regarding Business Results (4) Outlook for Fiscal 2023” on page 9of the Attachment for the assumptions used.
Access to Documents and Other Materials Relating to the Year-End Results Briefing to Be Held on February 9, 2023
Supplementary results presentation materials will be disclosed on TDnet and posted on the Company’s website on the day
results are announced. In addition, the video of the briefing will be posted on the Company’s website immediately after thebriefing is closed.

Index of the Attachment
1. Qualitative Information regarding Business Results .................................................................

2(1) Overview of Consolidated Business Results..........................................................................

2(2) Overview of Financial Position ...............................................................................................

7(3) Overview of Cash Flows ........................................................................................................

7(4) Outlook for Fiscal 2023 ..........................................................................................................

9(5) Basic Policies Related to Profit Distribution and Dividends in Fiscal 2022 and 2023.............

10

2. Management Policies ...............................................................................................................

10(1) Fundamental Management Policies .......................................................................................

10(2) Management Indicator Targets, Medium- to Long-Term Strategies
and Issues to Be Addressed ................................................................................................

10

3. Basic Approach to Selection of Accounting Standards .............................................................

11

4. Consolidated Financial Statements and Notes .........................................................................

12(1) Consolidated Balance Sheets ................................................................................................

12(2) Consolidated Statements of Income and Consolidated Statementsof Comprehensive Income .....................................................................................................

14(3) Consolidated Statements of Changes in Net Assets .............................................................

16(4) Consolidated Statements of Cash Flows ...............................................................................

18(5) Notes regarding Consolidated Financial Statements .............................................................

20

Notes regarding Going Concern Assumptions .......................................................................

20

Changes in Accounting Principles .........................................................................................

20

Changes in Presentation Methods .........................................................................................

21

Segment and Other Information .............................................................................................

22

Per Share Information ............................................................................................................

28

Significant Subsequent Information .......................................................................................

28

1

1. Qualitative Information regarding Business Results(1) Overview of Consolidated Business Results
In the fiscal year ended December 31, 2022 (“fiscal 2022”), the world economy continued togradually recover as restrictions on economic activities were eased. However, the future remained
unforeseeable as signs of economic deceleration appeared in the latter half of the year due in partto a rise in interest rates in various countries amid rapid inflation and the prolonged Russia-Ukraine
crisis.
Amid these circumstances, the Group worked to tackle the three challenges outlined in the mediumterm management plan “PASSION 2026,” which was launched at the beginning of the year: 1)
Sustainability as an opportunity, 2) Innovations starting from networking, and 3) Transformation ofpeople and organization. In addition, we revised the prices of products that were affected by soaring
raw material and fuel costs while focusing on ensuring a steady supply of high value-added
products by levering the global network we have constructed.
Consequently, consolidated operating results for fiscal 2022 are as follows: net sales were¥756,376 million (¥629,370 million in the previous fiscal year); operating income was ¥87,139
million (¥72,256 million in the previous fiscal year); ordinary income was ¥84,060 million (¥68,756
million in the previous fiscal year); and net income attributable to owners of the parent was ¥54,307
million (¥37,262 million in the previous fiscal year). Furthermore, we recorded an extraordinary lossof ¥5,785 million as costs related to the suspension of operations due mainly to the suspension ofsome production facilities at a U.S. subsidiary.
On January 1, 2022, the Company revised its organizational structure and changed the segmentclassification of the aqua business from “Others” to “Functional Materials.” In addition, the method of
allocating eliminations of profits from some internal transactions among segments and corporate
has been changed. Figures used in comparisons and analyses of the fiscal year reflect thesechanges. Furthermore, from January 1, 2022, we have adopted the Accounting Standard for
Revenue Recognition (ASBJ Statement No. 29; March 31, 2020). In line with the transition
provisions set out in the revision to paragraph 84, the new accounting principle was not retroactively
applied to the consolidated figures for the previous fiscal year. Net sales for the Trading segment
and elimination & corporate for fiscal 2022 have significantly changed compared to fiscal 2021,
mainly due to changes in accounting methods for revenues attributable to agent transactions in the
Trading segment as a result of the adoption of the Accounting Standard for Revenue Recognitionand other factors. Because of these changes, revenues from such transactions, which havepreviously been recorded on the basis of total transactional value, are now recorded on a net basis.
Due to this change, net sales in the Trading segment were ¥84,985 million lower compared with theoriginal method.

2

(Millions of yen)
FY2021

FY2022

Vinyl Acetate

304,690

Operating
Income58,255Isoprene

61,940Functional

Change385,345

Operating
Income77,54780,655

Operating
Income19,292

6,080

65,635

4,270

3,695

(1,809)142,366

8,673

174,059

8,574

31,692(99)

Fibers and Textiles

61,082

5,608

66,859

6,736

5,776

1,127

Trading

144,027

4,842

58,844

5,121(85,182)

279

Others44,327

1,206

52,051

2,679

7,723

1,473

(129,064)(12,409)(46,420)(17,792)

82,644(5,382)

629,370

72,256756,376

87,139127,005

14,882Net Sales

Materials

Elimination &Corporate
Total

Net Sales

Net Sales

Results by Business Segment
Vinyl Acetate
Sales in this segment were ¥385,345 million (¥304,690 million in the previous fiscal year), andsegment income was ¥77,547 million (¥58,255 million in the previous fiscal year).

(1) The sales volume of PVOH resin decreased due to the suspension of some production facilities
at a U.S. subsidiary and a contraction in demand in the latter half of the year. On the other
hand, we continued shifting to high value-added products while revising prices amid soaring raw
material and fuel prices. Shipments of optical-use poval film declined significantly from the
middle of the year due to the impact of LCD panel inventory adjustments. In addition, to meetneeds for larger TV panel sizes, we decided to make a capital investment at the Kurashiki Plant(slated to begin operating in mid 2024), announcing this intention on May 9, 2022. As for
Advanced Interlayer Solutions, sales of PVB film, especially for use in construction applicationsin North America, held steady year on year. Sales of water-soluble PVOH film were firm for use
in unit dose laundry detergent packets.
(2) As for EVAL™ ethylene vinyl alcohol copolymer (EVOH resin), the sales volume increased due
to steady performance for use in food packaging applications as we revised product prices. In
response to strong demand, we worked to improve productivity and decided to invest in
production capacity expansion in Europe and the United States.

3

Isoprene
Sales in this segment were ¥65,635 million (¥61,940 million in the previous fiscal year), andsegment income was ¥4,270 million (¥6,080 million in the previous fiscal year).

(1) Amid soaring raw material and fuel prices, we revised the prices of isoprene chemicals andelastomer. Nevertheless, the sales volume decreased due to a temporary difficulty in procuring
raw materials and a contraction in demand in the latter half of the year.
(2) The sales volume of GENESTAR™ heat-resistant polyamide resin decreased due in part toinventory adjustments in automotive parts and electric and electronic devices.
Functional Materials
Sales in this segment were ¥174,059 million (¥142,366 million in the previous fiscal year), andsegment income was ¥8,574 million (¥8,673 million in the previous fiscal year).

(1) In the methacrylate business, the sales volume decreased due in part to electric and electronic
device inventory adjustments. Soaring raw material prices and deteriorating market conditions
also had a negative impact.
(2) In the medical business, sales of cosmetic dental materials expanded in Japan and overseas.
(3) In the environmental solutions business, demand for drinking water and water for industrial
applications increased, especially in Europe and the United States, and sales of activatedcarbon expanded. In addition, we revised product prices due to soaring raw material and fuelprices.
(4) In the aqua business, demand for hollow fiber membranes for water treatment remained steady.

4Fibers and Textiles
Sales in this segment were ¥66,859 million (¥61,082 million in the previous fiscal year), andsegment income was ¥6,736 million (¥5,608 million in the previous fiscal year).

(1) Sales of CLARINO™ man-made leather expanded for use in automotive and luxury products.
(2) In fibers and industrial materials, KURALON™ was affected by a delayed recovery in the
production of automobiles and an economic slowdown in the latter half of the year, while salesof VECTRAN™ remained favorable, especially for exports.
(3) In consumer goods and materials, demand for KURAFLEX™ in the restaurant industry was
weak despite an increase in shipments for hygienic applications.
Trading
Sales in this segment were ¥58,844 million (¥144,027 million in the previous fiscal year), andsegment income was ¥5,121 million (¥4,842 million in the previous fiscal year). In comparison withthe previous methods, net sales decreased ¥84,985 million due to the adoption of the AccountingStandard for Revenue Recognition and other factors.

(1) In fiber-related businesses, sales expanded, especially for wearables and other sportswear.
(2) Although sales of resins and chemicals had been brisk in the Asian market in the first half of theyear, sales were affected by the economic slowdown in the second half of the year.

5Others
In Others, domestic affiliates saw sales recover. As a result, segment sales were ¥52,051 million(¥44,327 million in the previous fiscal year), and segment income was ¥2,679 million (¥1,206 million
in the previous fiscal year).

6(2) Overview of Financial Position
Total assets increased ¥130,518 million from the end of the previous fiscal year to ¥1,221,533 million
mainly because of a ¥67,728 million increase in inventories, a ¥21,247 million increase in notes andaccounts receivable–trade, and contract assets (notes and accounts receivable–trade in the previous
fiscal year), a ¥20,105 million increase in construction in progress, and a ¥18,700 million increase inmachinery, equipment and vehicles, net despite a ¥28,218 million decrease in cash and deposits.
Total liabilities increased ¥41,586 million to ¥552,998 million due to factors that included a ¥12,488
million increase in other noncurrent liabilities and the issuance of ¥10,000 million in commercial paperand ¥10,000 million in bonds payable.
Net assets rose ¥88,932 million to ¥668,534 million. Equity attributable to owners of the parent
amounted to ¥646,750 million, for an equity ratio of 52.9%.
(3) Overview of Cash Flows
Cash Flows from Operating Activities:
Net cash provided by operating activities totaled ¥51,727 million. Cash provided included ¥77,997
million from income before income taxes and noncontrolling interests and ¥65,456 million in
depreciation and amortization. Cash used included a ¥12,500 million increase in notes andaccounts receivable – trade, a ¥54,716 million increase in inventories, and ¥19,453 million inincome taxes paid.
Cash Flows from Investing Activities:
Net cash used in investing activities totaled ¥68,624 million. Contributing factors included ¥71,635
million used for the purchase of tangible fixed assets and intangible fixed assets.
Cash Flows from Financing Activities:
Net cash used in financing activities was ¥12,053 million. Cash provided included ¥49,375 million inproceeds from long-term loans payable, a ¥10,000 million net increase in commercial paper, and an
issuance of ¥10,000 million in corporate bonds. Cash used included ¥55,013 million for the
repayment of long-term loans payable, ¥10,002 million for the purchase of treasury stock, and cash
dividends paid totaling ¥13,908 million.
The above factors along with the effect of exchange rate changes on cash and cash equivalents
resulted in a ¥23,870 million decrease in cash and cash equivalents at the end of the fiscal year to¥127,616 million.

7

(Millions of yen)
Fiscal Year Ended
December 31, 2021
78,221

Fiscal Year Ended
December 31, 2022
51,727

Net cash used in investing activities(65,595)(68,624)

Net cash used in financing activities(47,447)(12,053)

4,224

4,943

(30,596)(24,006)

182,084

151,487－

136

151,487

127,616

Net cash provided by operating activities

Effect of exchange rate changes on cash andcash equivalents
Net increase in cash and cash equivalents
Cash and cash equivalents, beginning of theperiodIncrease in cash and cash equivalents fromnewly consolidated subsidiaries
Cash and cash equivalents, end of the period[Reference] Cash Flow Indicators for the Kuraray Group

Equity ratio (%)
Equity ratio (%;market basis)
Ratio of cash flow tointerest-bearing
liabilities (%)
Interest coverage
ratio (times)

Fiscal Year
Fiscal Year
Fiscal Year
Fiscal Year
Fiscal Year
Ended
Ended
Ended
Ended
Ended
December 31, December 31, December 31, December 31, December 31,
2018
2019
2020
2021
2022
58.6
53.0
47.4
51.3
52.9
57.1

46.2

35.9

31.5

29.0

2.9

2.5

4.3

3.9

6.3

62.7

68.5

57.0

50.9

43.6

Notes:
Equity ratio: Total net assets excluding both subscription rights to shares and noncontrollinginterests/total liabilities and net assets
Equity ratio (market basis): Total market value of shares issued and outstanding/total net assets
Ratio of cash flow to interest-bearing liabilities: Interest-bearing liabilities/net cash provided by(used in) operating activities
Interest coverage ratio: Net cash provided by (used in) operating activities/interest expenses
1. All indicators are calculated using the consolidated financial statements.
2. The total market value of shares issued and outstanding was calculated by multiplying theclosing price at the end of the fiscal year by the total number of shares issued and outstanding(after subtracting treasury stock) at the end of the fiscal year.
3. The calculations use net cash provided by (used in) operating activities as reported in the
consolidated statements of cash flows.
4. Interest-bearing liabilities are all liabilities reported in the consolidated balance sheets that
require the payment of interest.

8(4) Outlook for Fiscal 2023
The outlook for the economic environment over the next year is expected to shift toward a recovery
trajectory in the latter half of the year despite lingering risks of an economic slowdown due to financial
tightening, especially in Europe and the United States, in addition to geopolitical risks, including theRussia-Ukraine situation.
Amid this situation, the Group will continue to promote measures in line with its medium-term
management plan “PASSION 2026” and stably supply high value-added products by leveraging its
comprehensive Group strengths while paying careful attention to trends in demand and the supply
chain. In addition, we will safely set up activated carbon manufacturing equipment in the United States,
the new water soluble poval film plant in Poland as well as an isoprene base in Thailand, and swiftly
make them profitable.
Based on these circumstances, the outlook for fiscal 2023 is as follows.
(Billions of yen, rounded to the nearest hundred million)
Forecast for
Fiscal 2022
Change (Adjusted)
Fiscal 2023
756.4
830.0
9.7%
87.1
84.0
(3.6)%
84.1
79.0(6.0)%Net sales
Operating income
Ordinary income
Net income attributable to
54.3
51.0
(6.1)%
owners of the parent
For the forecast of operating results for fiscal 2023, we assume average exchange rates of ¥130 to
the U.S. dollar and ¥140 to the euro, as well as a domestic naphtha price of ¥69,000 per kiloliter.

[Reference] Forecast of Results by Segment for Fiscal 2023
(Billions of yen, rounded to the nearest hundred million)
Net Sales
Operating Income
Forecast for
Forecast for
Fiscal 2022
Fiscal 2022
Fiscal 2023
Fiscal 2023
Vinyl Acetate
385.3
430.0
77.5
79.0
Isoprene
65.6
78.0
4.3
1.0
Functional Materials
174.1
195.0
8.6
9.0
Fibers and Textiles
66.9
72.0
6.7
5.5
Trading
58.8
63.0
5.1
5.2
Others
52.1
41.0
2.7
1.0
Elimination &(46.4)(49.0)(17.8)(16.7)
Corporate
Total
756.4
83.0
87.1
84.0
Note: The above forecasts are based on the best information currently available. Actual
operating results may vary significantly due to various factors.

9(5) Basic Policies Related to Profit Distribution and Dividends in Fiscal 2022 and 2023
The Company positions the distribution of profits to all shareholders as a priority management issue.
During the period of the medium-term management plan “PASSION 2026” (FY2022–FY2026), ourbasic policy is to ensure a total return ratio of at least 35% as a proportion of net income attributableto owners of the parent, and an annual dividend of at least ¥40 per share.
For fiscal 2022, we revised our previous forecast and plan to pay out an annual dividend of ¥44 pershare comprising an interim dividend of ¥21 and a year-end dividend of ¥23. In addition, in fiscal 2022,
we purchased 9,424 thousand shares of treasury stock totaling ¥9,999 million.
For fiscal 2023, we plan to pay out an annual dividend of ¥48 per share comprising an interim dividendof ¥24 and a year-end dividend of ¥24.
2. Management Policies(1) Fundamental Management Policies
Kuraray’s mission in its corporate statement is: “For people and the planet—to achieve what no one
else can.” Based on this, the Company aims to be a “Specialty Chemical Company contributing tocustomers, society and the planet and growing sustainably by incorporating new innovation platforms
into its own technologies.” This is the Kuraray Vision 2026 long-term vision, which we aim to realizeby 2026, the centennial of the Company's founding.
(2) Management Indicator Targets, Medium- to Long-Term Strategies and Issues to Be
Addressed
In the five-year medium-term management plan “PASSION 2026,” which began from fiscal 2022, theGroup set the three challenges to tackle listed below to realize its long-term Kuraray Vision 2026.
1) Sustainability as an opportunity
Take sustainability as an opportunity and promote it with the collective strength of the whole group
2) Innovations starting from networking
Create a growth driver by connecting people with people, and technologies with technologies, bothwithin and outside the Company
3) Transformation of people and organization
Transform people and organization via the digital-driven process innovation and the promotion ofdiversity which will, in turn, help us bring to bear a broad range of ideas

10In fiscal 2023, which is the second year of “PASSION 2026,” we will steadily carry out capital investment,such as in the isoprene base in Thailand, the water-soluble poval film production base, and the activatedcarbon manufacturing facility in the United States. We will also direct resource allocation toward growthbusinesses as we strive to create a more upgraded business portfolio. The Group will continue taking onsuch challenges as a sustainably growing specialty chemical company looking toward the centennial in2026.
In addition, since its founding, the Group has conducted management that contributes to sustainable
development by aiming to improve natural and living environments through business activities.
We consider sustainability a key management strategy. We select material issues to prioritize for thesustainable development of the Company and society at the management level and work to solve theseissues as a unified company.
Under the medium-term management plan “PASSION 2026,” the Group has put together and is
implementing a medium-term sustainability plan comprising measures related to sustainability.
We have announced our support of the recommendations of the Task Force on Climate-Related Financial
Disclosures (TCFD) and are diligently working on the four items suggested: governance, strategy, risk
management, and indicators and targets. The Group proactively promotes sustainability and will continue
contributing to the natural environment and the enriched lives of people everywhere through its highly
unique technologies and products. Details of the Group’s sustainability-related initiatives and disclosures
based on the TCFD framework are uploaded on the Company’s official website.
Kuraray Report (Integrated report) https://www.kuraray.com/csr/report_backnumber
Sustainability Website
https://www.kuraray.com/csr
Sustainability Medium-term Plan
https://www.kuraray.com/csr/report2022/4p-model
In addition, there was a fire that resulted in injuries of outside contract workers at a U.S. subsidiary in May
2018, and multiple civil lawsuits were filed seeking damages. Only some of the plaintiffs’ lawsuits are still
active. To ensure a similar fire does not occur again, safety inspections have been conducted at our main
overseas chemical plants since 2019 in an effort to revise and strengthen safety measures. In addition,
we regularly conduct risk assessments, and, regarding identified risks, we strive for mitigation through thetaking of additional measures in line with the extent of assumed damage and the level of current safetymeasures. In 2022, we established a new Global Process Safety Management Audit Team and strengthen
safety audits for chemical and activated carbon plants. We identify and assess issues from various
viewpoints through organization-wide activities undertaken by this team, which is well versed in safetyassurance and enhance the rollout and sharing of knowledge for making improvements.

3. Basic Approach to Selection of Accounting Standards
The Kuraray Group applies Japanese generally accepted accounting principles (“GAAP”). The
Kuraray Group is considering the adoption of International Financial Reporting Standards (“IFRS”)
and other matters while taking into account various circumstances in Japan and overseas.

11

4. Consolidated Financial Statements and Notes(1) Consolidated Balance Sheets(Millions of yen)
December 31, 2021

December 31, 2022

Cash and deposits

151,942

123,724

Notes and accounts receivable–trade135,768――

157,016

3,855

4,852

Merchandise and finished goods

103,505

145,851

Work in process

15,69919,078Raw materials and supplies

38,10060,104

Other

21,74523,815

(443)

(510)

470,174

533,933

Buildings and structures, net

88,801

94,745

Machinery, equipment and vehicles, net

200,500

219,200Land

22,64823,264

Construction in progress

117,319

137,424

Other, net

25,99737,926

Total property, plant, and equipment

455,266

512,562

Goodwill

52,63556,058Customer-related assets

29,17630,432Other

32,24334,993

Total intangible assets

114,055

121,484

25,68923,194Long-term loans receivable

121

97

Retirement benefit asset

3,066

2,104

Deferred tax assets

13,98016,718

Other

8,686

11,458(26)(20)

51,51753,553620,839

687,600

1,091,014

1,221,533

ASSETS
Current Assets

Notes and accounts receivable–trade, and contract
assetsSecurities

Allowance for doubtful accounts
Total current assets
Non-current Assets
Property, plant and equipment

Intangible assets

Investments and other assets
Investment securities

Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total Assets

12

(Millions of yen)
December 31, 2021

December 31, 2022

Notes and accounts payable–trade

49,641

52,717

Short-term borrowings

34,48034,480Commercial paper―

10,000Current portion of bonds payable―

10,000Current portion of long-term borrowings

55,01330,434

Accrued expenses

19,86321,075

Income taxes payable

13,133

11,370

Provision for bonuses

7,996

9,132

89

111

LIABILITIESCurrent Liabilities

Other provisions

39,24642,008

Total current liabilities
Non-current Liabilities

219,464

221,330

Bonds payable

60,00060,000Long-term borrowings

157,945

179,491

Deferred tax liabilities

12,022

17,279Provision for retirement benefits for directors (and otherofficers)

375

294

Provision for environmental measures

365

397

Retirement benefit liability

25,62925,626

Asset retirement obligations

4,821

5,303

Other

30,78743,275291,947

331,668

511,411552,998

Share capital

88,95588,955

Capital surplus

87,16687,152Retained earnings

359,898

399,910

Treasury shares(15,885)(25,735)

520,134

550,282

7,273

5,769

219

611

Foreign currency translation adjustment

34,64890,555Remeasurements of defined benefit plans(2,291)(468)

Total accumulated other comprehensive income

39,85096,467

Other

Total non-current liabilities
Total Liabilities
NET ASSETS
Shareholders’ Equity

Total shareholders’ equity
Accumulated Other Comprehensive Income
Valuation difference on available-for-sale securities
Deferred gain or losses on hedges

Share Acquisition Rights

414

341

Non-controlling Interests

19,203

21,443

Total Net Assets

579,602668,534

1,091,014

1,221,533

Total Liabilities and Net Assets

13

(2)Consolidated Statements of Income and Consolidated Statements ofComprehensive Income
Consolidated Statements of Income

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Selling expenses
General and administrative expenses
Total selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Share of profit of entities accounted for using equity method
Gain on investments in investment partnerships
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange loss
Loss on disposal of tangible non-current assets
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sale of investment securities
Insurance claim income
Subsidy income
Compensation for transfer
Total extraordinary income
Extraordinary losses
Costs related to the suspension of operations
Loss on litigation
Impairment loss
Loss on disaster
Loss on disposal of tangible non-current assets
Loss on tax purpose reduction entry of noncurrent assets
Total extraordinary losses
Income before income taxes and non-controlling interests
Income taxes—current
Income taxes for prior periods
Income taxes—deferred
Total income taxes
Net income
Net income attributable to non-controlling interests
Net income attributable to owners of the parent

14

Fiscal 2021
(January 1, 2021 –December 31, 2021)
629,370425,234
204,136(Millions of yen)
Fiscal 2022
(January 1, 2022 –December 31, 2022)
756,376
514,713
241,663

38,721
93,157
131,879
72,256

46,678107,845
154,524
87,139

141
553
261
79
1,403
2,439

450
714
271
382
1,708
3,527

1,627
188
639
3,475
5,930
68,765

1,457
1,021
986
3,140
6,606
84,060

563
544
510
422
2,040

2,614
1,415
―
―
4,030

1,350
4,296
1,569
3,284
1,183
423
12,108

5,785
1,819
1,385
653
450
―
10,09458,697
19,7181,386(767)
20,33638,3601,098
37,262

77,997
21,232―
1,155
22,38855,6081,300
54,307

Consolidated Statements of Comprehensive Income(Millions of yen)

Net income

Fiscal 2021
(January 1, 2021 –December 31, 2021)

Fiscal 2022
(January 1, 2022 –December 31, 2022)

38,36055,608426(1,504)

Other comprehensive income
Valuation difference on available-for-sale securities

793

645

Foreign currency translation adjustment

33,13056,798Remeasurements of defined benefit plans, net of tax

3,030

1,822

Total other comprehensive income

37,38057,76275,741

113,371

Owners of the parent

74,491

110,925

Non-controlling interests

1,249

2,446

Deferred gains or losses on hedges

Quarterly comprehensive income
Comprehensive income attributable to:15

(3) Consolidated Statements of Changes in Net Assets
Fiscal 2021 (January 1, 2021 – December 31, 2021)(Millions of yen)
Capitalstock
Balance at January 1,
2021
Changes of items
during the period
Cash dividends
Net loss attributable toowners of the parent
Purchase of treasury
stock
Disposal of treasury
stock
Changes resulting fromadditions toconsolidation
Other
Net changes of items
other thanshareholders’ equity
Total changes of items
during the period
Balance at December 31,
2021

88,955

Capitalsurplus87,178

Shareholders’ equity
Retained
Treasury
earnings
stock
336,050(16,006)

Total shareholders’equity496,177(13,414)(13,414)37,26237,262

(12)

(2)

(2)

123

111

―

(12)

23,847120

23,956

88,95587,166359,898(15,885)

520,134

Accumulated other comprehensive income
Valuation Deferred
Foreign
RemeasureTotal
Nondifference gains orcurrency
ment ofaccumulated Subscription
Total netrights tocontrollingon available- losses on translation defined benefit
other
assetssharesinterests
forhedges adjustment
planscomprehensive
saleincomesecurities
Balance at January 1, 2021
6,847
(376)
1,470
(5,321)
2,620
328
16,354 515,481
Changes of items during
the period
Cash dividends(13,414)Net loss attributable toowners of the parent
37,262
Purchase of treasury
stock
(2)
Disposal of treasury
stock
111
Other
Net changes of items
other than426
595
33,1783,030
37,22986
2,848
40,165
shareholders’ equity
Total changes of items
426
595
33,1783,030
37,22986
2,848
64,121during the period
Balance at December 31,
7,273
219
34,64839,850414
19,203 579,602(2,291)
2021

16

Fiscal 2022 (January 1, 2022 – December 31, 2022)(Millions of yen)
Capitalstock
Balance at January 1,
2022
Cumulative effect ofchanges inaccounting policies
Restated balance
Changes of items during
the period
Cash dividends
Net income attributableto owners of theparentChanges resulting fromadditions toconsolidation
Purchase of treasury
stock
Disposal of treasurystock
Net changes of items
other thanshareholders’ equity
Total changes of items
during the period
Balance at December 31,
2022

Capitalsurplus

Shareholders’ equity
Retained
Treasury
earnings
stock

Total shareholders’equity88,95587,166359,898(15,885)

520,134

88,95587,166(388)
359,509(15,885)(388)
519,745(13,908)(13,908)

54,30754,3072

2(14)(10,002)(10,002)

152

138
―

―

(14)

40,401(9,849)30,537

88,95587,152399,910(25,735)

550,282

Accumulated other comprehensive income
Valuation
Deferred Foreign
RemeasureTotal
Subscription
Nondifference on gains or currency
ment ofaccumulated
rights tocontrolling
available-for losses on translation defined benefit
othersharesinterestssalehedges adjustment
planscomprehensive
securities
incomeBalance at January 1, 2022
7,273
219
34,648(2,291)
39,850414
19,203Cumulative effect ofchanges in accounting
policies
Restated balance
7,273
219
34,648(2,291)
39,850414
19,203
Changes of items during
the period
Cash dividends
Net income attributableto owners of the parent
Changes resulting fromadditions toconsolidation
Purchase of treasury
stock
Disposal of treasurystock
Net changes of items
other thanshareholders’ equity(1,504)392
55,906
1,822
56,617(73)
2,240
Total changes of items
during the period(1,504)392
55,906
1,822
56,617(73)
2,240
Balance at December 31,
2022
5,769
611
90,555(468)
96,467341
21,44317

Total net
assets579,602(388)
579,213(13,908)
54,3072
10,002
138
58,78389,321
668,534

(4) Consolidated Statements of Cash Flows(Millions of yen)
Fiscal 2021
(January 1, 2021 –December 31, 2021)

Fiscal 2022
(January 1, 2022 –December 31, 2022)

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

58,697

77,997

Depreciation and amortization

59,00365,456

Increase (decrease) in allowance for doubtful accounts

(29)

9

Loss (gain) on sale of investment securities(563)(2,614)

Loss on litigation

4,296

1,819

Impairment loss

1,569

1,385

Loss on disposal of tangible fixed assets

1,183

450

Foreign exchange losses (gains)(2,610)(2,777)

Interest and dividend income(694)(1,165)Interest expenses
Decrease (increase) in notes and accounts receivable –
trade

1,627

1,457

(13,437)(12,500)

Decrease (increase) in inventories(17,537)(54,716)

Increase (decrease) in notes and accounts payable – trade

12,244

691

858

632

Increase (decrease) in net defined benefit liabilities

2,273

678

Decrease (increase) in net defined benefit assets

(624)

664

Other, net

10,899(4,771)

Subtotal

117,157

72,696833

1,246Interest paid

(1,537)(1,186)

Income taxes (paid) refund(14,127)(19,453)

Payments for loss on litigation(24,104)(1,575)

Net cash provided by (used in) operating activities

78,221

51,727

Net decrease (increase) in time deposits

(150)

3,350

Net decrease (increase) in short-term investment securities

6,000

-

1,647

3,336

(68,408)(71,635)(1,774)(1,022)

92

613

Other, net(3,000)(3,266)

Net cash provided by (used in) investing activities(65,595)(68,624)

Increase (decrease) in provision for bonuses

Interest and dividends received

Net cash provided by (used in) investing activities

Proceeds from sale and redemption of investment
securities
Purchase of tangible fixed assets and intangible fixed
assetsPayments for disposal of tangible fixed assets andintangible fixed assets
Proceeds from sales of tangible fixed assets and intangible
fixed assets

18

Fiscal 2021
(January 1, 2021 –December 31, 2021)(Millions of yen)
Fiscal 2022
(January 1, 2022 –December 31, 2022)

Net cash provided by (used in) financing activities(20,000)

10,000

Proceeds from long-term loans payable

6,212

49,375

Repayment of long-term loans payable(29)(55,013)

Proceeds from corporate bonds―

10,000(20,000)―

Purchase of treasury stock(2)(10,002)

Proceeds from sale of treasury stock82

0(13,414)(13,908)

Proceeds from stock issuance to noncontrolling interests

1,820

502

Dividends paid to noncontrolling interests

(220)

(708)

Other, net(1,894)(2,297)

Net cash provided by (used in) financing activities(47,447)(12,053)

4,224

4,943

(30,596)(24,006)

182,084

151,487―

136

151,487

127,616

Net increase (decrease) in commercial paper

Payment for redemption of corporate bonds

Dividends paid

Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents, beginning of the period
Increase in cash and cash equivalents fromconsolidated subsidiaries
Cash and cash equivalents, end of the period

newly

19

(5) Notes regarding Consolidated Financial Statements
Notes regarding Going Concern Assumptions
None
Changes in Accounting Principles
Adoption of Accounting Standard for Revenue Recognition
Kuraray has adopted the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29,
March 31, 2020) from January 1, 2022, and recognizes revenue for goods or services based on theamount estimated to be received in exchange for such goods or services at the point when controlof the promised goods or services is transferred to the customer.
The main changes resulting from the adoption of the standards are as follows.
(1) In supply transactions with repurchase obligations, we changed the method by which theelimination of supplied goods is not recognized and changed the method by which liabilities
related to supply transactions regarding consideration received from suppliers are recognized.
(2) In contracts with customers that include a variable consideration among their considerations,when the uncertainty related to the amount of the variable consideration is eventuallyeliminated (restricted to portions that have a high probability of not generating a significant
drop in revenue until the uncertainty is eliminated), the variable consideration is included in thetransaction price. In addition, a portion of such variable considerations was formerly presented
under selling, general and administrative expenses, however, the presentation method has
been changed so that it is now presented after being excluded from net sales.
(3) Regarding transactions where the role of providing products or goods corresponds to that ofan agent, we have changed the previous method of recognizing the total consideration
received from the customer as revenue to a method in which we recognize the net amountreceived from the customer, excluding the amount paid to the buyer, as revenue.
Regarding the adoption of the revenue recognition standards, in line with the transition provisions
set out in the revision to paragraph 84, the cumulative effect of retroactively applying the new
accounting principle before January 1, 2022, is added or subtracted to retained earnings as ofJanuary 1, 2022, and the new accounting principle is adopted from January 1, 2022.
As a result, net sales for fiscal 2021 decreased ¥4,651 million. The effect on operating income,ordinary income, and income before income taxes and non-controlling interests is minimal. In
addition, the balance of retained earnings as of January 1, 2022, decreased ¥388 million.
Because we adopted the revenue recognition standards, in the consolidated balance sheet for theprevious fiscal year, “notes and accounts receivable–trade” previously presented under current
assets is included in “notes and accounts receivable–trade and contract assets” from January 1,
2022. In line with the transition provisions set out in Paragraph 89-2 of the revenue recognition
standard, we have not revised the presentation method for the previous fiscal year.

20Adoption of Accounting Standard for Fair Value Measurement
Kuraray has adopted the Accounting Standard for Fair Value Measurement (ASBJ Statement No.
30, July 4, 2019) from January 1, 2022. The Company has prospectively adopted new accounting
policies based on the Accounting Standard for Fair Value Measurement in accordance with thetransition provisions in Paragraph 19 of the Accounting Standard for Fair Value Measurement andParagraph 44-2 of the Accounting Standard for Financial Instruments (ASBJ Statement No. 10, July4, 2019). These changes have no impact on quarterly financial statements.
Application of Accounting Standard Related to U.S. Leases
At overseas affiliates that apply U.S. GAAP, ASC No. 842 pertaining to leases is applied from fiscal
2022. Regarding operating leases (loans) to which ASC No. 840 applies, as a general rule werecord all leases as assets and liabilities in the consolidated balance sheet. Regarding theapplication of this accounting standard, we adopt methods to recognize cumulative effects on the
day application begins in line with transition provisions.
As a result, in the consolidated balance sheet for fiscal 2022, “other” presented under tangible noncurrent assets increased ¥10,731 million, “other” presented under current liabilities increased¥2,059 million, and “other” presented under non-current liabilities increased ¥9,206 million.
Changes in Presentation Methods
Consolidated Statements of Income
In the previous fiscal year, “gain on investments in investment partnerships” was included in “other”
under non-operating income. However, due to its increased financial importance, from fiscal 2022
this item is presented as an independent line item. To reflect this change in presentation method,some items presented in the consolidated financial statements for the previous fiscal year havebeen restated.
As a result, under non-operating income in the consolidated statements of income for the previous
fiscal year, “other” amounting to ¥1,482 million has been restated as “gain on investments ininvestment partnerships” of ¥79 million and “other” of ¥1,403 million.
Consolidated Statements of Cash Flows
From fiscal 2022, “purchase of investment securities,” which had been an independent line item
under net cash provided by (used in) investing activities in the previous fiscal year, is now included
in “other” due to diminished financial importance. To reflect this change in presentation method,some items presented in the consolidated financial statements for the previous fiscal year havebeen restated.
As a result, under net cash provided by (used in) investing activities in the consolidated statementsof cash flows for the previous fiscal year, “purchase of investment securities” amounting to ¥88
million and “other” amounting to ¥2,912 million has been restated as “other” of ¥3,000 million.

21

Segment and Other Information(Segment Information)
1. Segment Overview
The business segments reported by Kuraray are the business units for which the Company is able
to obtain respective financial information separately in order for the Board of Directors to conductperiodic investigations to determine the distribution of management resources and evaluate theirbusiness results.
Kuraray adopts an in-house company system where each in-house company conducts businessactivities and establishes its own comprehensive strategy, both for Japan and for overseas markets,for the products it handles. In addition, among Kuraray subsidiaries, Kuraray Trading Co., Ltd.
independently conducts propriety planning and sales activities, including the processing and sale ofKuraray Group products as well as other companies’ products.
Consequently, Kuraray has created five business segments for reporting – “Vinyl Acetate,”“Isoprene,” “Functional Materials,” “Fibers and Textiles” and “Trading” – categorized by productgroup based on the respective in-house companies and the Trading segment.
The Vinyl Acetate segment manufactures and markets functional resins and film, including PVOH,
PVB and EVAL™. The Isoprene segment manufactures and markets SEPTON™ thermoplastic
elastomer, isoprene-related products and GENESTAR™. The Functional Materials segment
manufactures and markets methacrylic resin, medical products, carbon materials and others. The
Fibers and Textiles segment manufactures and sells synthetic fibers and textiles, CLARINO™ manmade leather, non-woven fabrics and others. The Trading segment mainly processes and sells
synthetic fibers and man-made leather, and conducts planning and marketing for other products
produced by the Kuraray Group and other companies.
Matters Related to a Change in Reporting Segments
Following in the organizational revision, we moved the aqua business from Others to Functional
Materials from fiscal 2022. Furthermore, segment information for the previous fiscal year has been
restated to reflect the changes to the reporting segments.
2. Methods for Calculating Reporting Segment Net Sales, Income and Loss, Assets andOther Items
The accounting method applied to reporting segments is the same as that used in creating theconsolidated financial statements. Profits from reporting segments are operating income, andintersegment sales and transfers are based on the prevailing market prices.

22

Change in Methods for Calculating Reporting Segment Net Sales, Income, and Assets
As stated in Change in Accounting Policies, we apply profit recognition accounting standards fromfiscal 2022 and accordingly changed the accounting treatment method related to profit recognition.
Similarly, the methods for calculating business segment net sales and profit have been changed.
Due to this change, compared with conventional methods, regarding net sales to outside customers
in fiscal 2022, there was a ¥35,854 million increase in Vinyl Acetate, a ¥10,340 million increase in
Isoprene, a ¥20,229 million increase in Functional Materials, a ¥10,889 million increase in Fibers
and Textiles, a ¥82,536 million decrease in Trading, and a ¥570 million increase in Others.
In addition, regarding intersegment net sales and transfers, there was a decrease in ¥37,055 million
in Vinyl Acetate, an ¥11,612 million decrease in Isoprene, a ¥20,438 million decrease in Functional
Materials, an ¥11,808 decrease in Fibers and Textiles, a ¥2,448 million decrease in Trading, a ¥844
million decrease in Others, and a ¥84,208 million increase in adjustment.
The impact of these changes on segment income and segment assets is minor.
In addition, we apply ASC No. 842 “Leases” to overseas affiliates in the United States from fiscal
2022. Due to this, regarding operating leases (lessees) in ASC No. 840, we recognize right-to-use
assets on the start date of application.
In addition, from fiscal 2022, regarding the elimination of some inter-segment trade income, wehave changed the method of allocation to each segment and the entire Company. Furthermore,segment information for the previous fiscal year has been restated to reflect the changed allocation
method.

23

3. Net Sales, Income and Loss, Net Assets and Other Items by Reporting Segment
Fiscal 2021 (January 1, 2021 to December 31, 2021)(Millions of yen)
Reporting Segment
Vinyl Isoprene Functional
AcetateMaterials
Net sales(1) Outside
254,814 31,994
customers(2) Intersegment
sales and
49,875 29,946
transfers
Total
304,690 61,940
Segment income
58,2556,080(loss)
Segment assets 424,726 125,446
Other items
Depreciation andamortization(other than
goodwill)
Impairment loss
Amortization of
goodwill
Balance of
goodwill at end ofcurrent period
Investments inequity method
affiliates
Increase intangible fixed
assets andintangible fixed
assetsOthers1

FibersandTextilesTrading

Total

Adjustment Consolidated
2,4,5Statements
3of Income

Total

119,397

46,023 141,306 593,536

35,834 629,370－

629,370

22,96915,0582,721 120,571

8,493 129,064(129,064)－

142,366

61,082 144,027 714,108

44,327 758,435(129,064)

629,370

5,608

4,842 83,460

1,206 84,666(12,409)72,256230,645

77,188 50,320 908,327

44,839 953,166

137,847

1,091,014

1,083 52,150

3,194

55,344

8,673

32,6182,487

11,5734,300

86 51,066

10

－

78

－

－

88

－

88

1,481

1,569

1,290

－

2,368

－

－

3,659

－

3,659

－

3,659

14,764－37,870－－ 52,635－ 52,635－

52,635

－

－

－

2,967

－

2,967

－

2,967

20,301

14,665

17,272

5,711

555 58,507

1,262 59,769

6,177

65,9472,967－

Notes:
1. The “Others” category incorporates operations not included in business segment reporting,including the engineering business.
2. Adjustment is as follows: Included within segment loss of ¥12,409 million is the elimination ofintersegment transactions of ¥218 million and corporate expenses of ¥12,191 million. Corporate
expenses mainly comprise the submitting company’s basic research expenses.
3. Segment income is adjusted to agree with operating income in the consolidated statements ofincome.
4. Adjustment is as follows: Included with segment assets of ¥137,847 million is the elimination ofintersegment transactions of ¥39,170 million and unallocated corporate assets of ¥177,018
million. Corporate assets mainly comprise the submitting company’s surplus funds, long-term
investments and assets related to basic research and administrative divisions at headquarters.
5. The ¥1,481 million adjustment to impairment loss is related to Companywide assets.

24

Fiscal 2022 (January 1, 2022 to December 31, 2022)(Millions of yen)
Reporting Segment
Vinyl Isoprene Functional Fibers Trading
AcetateMaterials andTextilesNet sales
Outside371,214 52,449 170,329 63,102
customers
Inter-segment
sales and
14,130 13,186
3,730 3,756
transfers
Total
385,345 65,635 174,059 66,859
Segment income
77,5474,270
8,574 6,736(loss)
Segment assets 487,392 158,821 284,016 82,638
Other items
Depreciation
andamortization
35,7692,768
13,249 4,709(other than
goodwill)
Impairment
1,036
－
291
18
loss
Amortization of
1,508
－
2,809
－
goodwill
Balance of
goodwill at end
15,272－40,786－of current
periodInvestments inequity method－－－ 3,298
affiliates
Increase intangible fixed
assets and22,303 13,97824,981 4,879
intangible fixed
assets5

Others1

Total

Total

Adjustment Consolidated
2,4Statements
3of Income57,155714,252 42,124

756,376－

756,376

1,689

36,493

9,927

46,420(46,420)－

58,844

750,745 52,051

802,796(46,420)756,376

5,121

102,251

104,931(17,792)

87,13951,058 1,063,926 51,246 1,115,173

106,360

1,221,533

2,679

187

56,683

1,111

57,794

3,343

61,138

－

1,346

－

1,346

39

1,385

－

4,318

－

4,318

－

4,318

－

56,058－56,058－56,058

－

3,298

－

3,298

－

3,298

219

66,362934

67,297

5,302

72,599Notes:
1. The “Others” category incorporates operations not included in business segment reporting,including the engineering business.
2. Adjustment is as follows: Included within segment loss of ¥17,792 million is the elimination ofintersegment transactions of ¥1,887 million and corporate expenses of ¥15,904 million. Corporate
expenses mainly comprise the submitting company’s basic research expenses.
3. Segment income is adjusted to agree with operating income in the consolidated statements ofincome.
4. Adjustment is as follows: Included with segment assets of ¥106,360 million is the elimination ofintersegment transactions of ¥47,242 million and unallocated corporate assets of ¥153,602
million. Corporate assets mainly comprise the submitting company’s surplus funds, long-term
investments and assets related to basic research and administrative divisions at headquarters.
5. The increase in tangible and intangible noncurrent assets does not include the increase
attributable to the application of ASC No. 842 “Leases.”25

Related Information
Fiscal 2021 (January 1, 2021 – December 31, 2021) Information by Each Product and Service
1. Information by Each Product and Service(Millions of yen)

Net sales to outside customers

Vinyl
Acetate301,055

Isoprene
60,562Functional
Materials
142,172

Fibers andTextiles
84,015

OthersTotal

41,565629,370

Notes:
Principal products of each segment are as follows:
Vinyl Acetate: PVOH resin and film, PVB resin and film, EVAL™ resin and others
Isoprene: SEPTON™ thermoplastic elastomer, isoprene chemicals, GENESTAR™ heat-resistantpolyamide resin and others
Functional Materials: Methacrylic resin, medical products, carbon materials, aqua business andothersFibers and Textiles: KURALON™, CLARINO™ man-made leather, KURAFLEX™ non-woven
fabrics, MAGICTAPE™ hook and loop fasteners, polyester and others
Others:Engineering business and others

As stated in Segment Information 1) Overview of Reporting segments, we moved the aqua businessfrom Others to Functional Materials from fiscal 2022, and the figures for the previous fiscal year
reflect the changed segments.
2. Information by Geographical Segment(1) Net Sales
Japan
170,532

United States
116,400

China
86,774(Millions of yen)
Europe148,405

Asia
77,528Other Area
29,729Total
629,370

Note: Net sales are classified by country or area based on customer location.
(2) Tangible Fixed Assets
Japan
185,489

United States
124,469(Millions of yen)
Thailand
62,640

Other Area
82,667

Total
455,266

3. Major Customers
No information is available as there is no single outside customer accounting for 10% or more of theCompany’s total net sales.
Fiscal 2022 (January 1, 2022 – December 31, 2022) Information by Each Product and Service
1. Information by Each Product and Service(Millions of yen)

Net sales to outside customers

Vinyl
Acetate378,334

Isoprene
64,847

Functional
Materials
172,838

Fibers andTextiles
93,484

OthersTotal

46,871

756,376

Notes:
Principal products of each segment are as follows:
Vinyl Acetate: PVOH resin and film, PVB resin and film, EVAL™ resin and others
Isoprene: SEPTON™ thermoplastic elastomer, isoprene chemicals, GENESTAR™ heat-resistantpolyamide resin and others
Functional Materials: Methacrylic resin, medical products, carbon materials, aqua business and26

Fibers and Textiles:
Others:othersKURALON™, CLARINO™ man-made leather, KURAFLEX™ non-woven
fabrics, MAGICTAPE™ hook and loop fasteners, polyester and others

Engineering business and others

2. Information by Geographical Segment(1) Net Sales
Japan
178,774

United States
164,673

China
90,028(Millions of yen)
Europe193,938

Asia
84,974

Other Area
43,987

Total
756,376

Note: Net sales are classified by country or area based on customer location.
(2) Tangible Fixed Assets
Japan
187,974

United States
156,214(Millions of yen)
Thailand
79,722Other Area
88,650Total
512,562

3. Major Customers
No information is available as there is no single outside customer accounting for 10% or more of theCompany’s total net sales.
Noncurrent assets and impairment loss by reporting segment
Fiscal 2021 (January 1, 2021 – December 31, 2021)
Omitted because the same information is provided under segment information
Fiscal 2022 (January 1, 2022 – December 31, 2022)
Omitted because the same information is provided under segment information
Amortization of goodwill and unamortized balances by reporting segment
Fiscal 2021 (January 1, 2021 – December 31, 2021)
Omitted because the same information is provided under segment information
Fiscal 2022 (January 1, 2022 – December 31, 2022)
Omitted because the same information is provided under segment information
Negative goodwill by reporting segment
Fiscal 2021 (January 1, 2021 – December 31, 2021)
None
Fiscal 2022 (January 1, 2022 – December 31, 2022)
None

27

Per Share Information

Net assets per share (yen)Basic net income (loss) per share (yen)Diluted net income per share (yen)Fiscal 2021
(January 1, 2021 –December 31, 2021)
1,627.84
108.32108.23Fiscal 2022
(January 1, 2022 –December 31, 2022)
1,932.37
161.13161.00Notes: 1. The basis for the computation of basic and diluted income per share is as follows:
Fiscal 2021
(January 1, 2021 –December 31, 2021)
Basic net income (loss) per share
Net income (loss) attributable to ownersof the parent (millions of yen)Amount unallocated to common stock(millions of yen)
Net income (loss) attributable to ownersof the parent allocated to common stock(millions of yen)
Average number of common stock
outstanding during the fiscal year
(thousand shares)

Fiscal 2022
(January 1, 2022 –December 31, 2022)

37,26254,307――37,26254,307

343,987

337,050

―

―

295

266

(295)

(266)

Diluted net income per share
Adjustment made on net income (millionsof yen)Increase of common stocks (thousand
shares)[Subscription rights to shares included inabove]
Outline of the residual securities notincluded in the calculation of the diluted
net income―

Significant Subsequent InformationNone28