Business Results for the Fiscal Year Ended
December 31, 2021 (Unaudited)

February 9, 2022
Kuraray Co., Ltd.

February 9, 2022
Kuraray Co., Ltd.

Consolidated Earnings Report for the Fiscal Year Ended December 31, 2021
Name of listed company:
Stock code:
Stock exchange listing:
URL:

Kuraray Co., Ltd.
3405
Tokyo, first section
https://www.kuraray.com/

Representative:
Title:
Name:
Contact:
Title:

Representative Director and President
Hitoshi Kawahara
Senior Manager, Corporate Communications Department, Corporate
Management Planning Office
Shinichi Takizawa+81-3-6701-1070

Name:
Tel:

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

1. Consolidated Financial Results for Fiscal 2021 (January 1, 2021 to December 31, 2021)(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 corresponding period of the previous fiscal year.)(Millions of yen)
Net Sales

Fiscal 2021
Fiscal 2020

629,370
541,797

(%)
16.2
(5.9)

Note: Comprehensive income:72,25644,341

108.32
7.48

Fully Diluted Net
Income per Share(Yen)
108.23
7.47[Reference] Equity in earnings of affiliate:

Ordinary Income

(%)
63.0
(18.1)For the fiscal 2021 :For the fiscal 2020 :Net Income per
Share (Yen)
Fiscal 2021
Fiscal 2020

Operating Income

Net Income
Attributable to Ownersof the Parent

(%)
73.0
(17.7)

68,76539,740¥75,741 million−¥11,430 million
Return on
Equity (%)(%)
37,262
2,570

(－%)
(－%)

Return on Total
Assets (%)
7.0
0.5

For fiscal 2021:
For fiscal 2020:

―
―

6.4
3.9

Operating
Income/Net Sales
(%)
11.5
8.2

¥261 million¥257 million(2) Consolidated Financial Position(Millions of yen)
Total Assets
Fiscal 2021
Fiscal 2020

Net Assets

1,091,014
1,051,584[Reference] Equity attributable to owners of the parent:

Equity Ratio (%)

579,602515,481For fiscal 2021:
For fiscal 2020:

51.3
47.4

Net Assets per Share(Yen)
1,627.84
1,450.32¥559,984 million¥498,798 million

(3) Consolidated Cash Flows(Millions of yen)
Cash Flows fromOperating Activities
Fiscal 2021
Fiscal 2020

Cash Flows from
Investing Activities

78,221
79,947

Cash Flows from
Financing Activities(65,595)(64,025)(47,447)
91,508Cash and Cash
Equivalents at End of
Period151,487
182,084

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

Record Date

Mar. 31AnnualFiscal 2020
Fiscal 2021
Fiscal 2022
(Forecast)

―
―

21.00
20.00

―
―

19.00
20.00

40.00
40.00

―

21.00

―

21.00

42.00

Total
Dividends
Paid(full year)(¥ million)
13,756
13,760

Payout Ratio(consolidated)(%)

Dividends/Net
Assets(consolidated)
(%)

535.1
36.9

2.7
2.6

33.6

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

Operating Income Ordinary Income(%)
Interim Period
Full Fiscal
Year320,000
650,000――(%)
33,00073,000――31,00069,000Net Income
Attributable to Ownersof the Parent
(%)
(%)
―
20,000――43,000―Net Income
per Share
(Yen)
58.14
125.00Note: Due to the adoption of the “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29)
from the fiscal year ending December 31, 2022, the above forecasts of consolidated financial results for fiscal
2022 reflect the application of the newly applied accounting standard. Therefore, the rate of change from theprevious fiscal year and the same quarter of the previous year is not shown.

[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 inConnection with the Preparation of Quarterly Consolidated Financial Statements
1. Changes following revision of accounting standards: No
2. Changes besides 1. above: No
3. Changes in accounting estimates: Yes
4. Restatement: No(3)
1.

Number of Shares Issued and Outstanding (Common Shares)
Number of shares issued and outstanding (including treasury stock) as of the period
end:
As of December 31, 2021
354,863,603 shares
As of December 31, 2020
354,863,603 shares

2.

Number of treasury shares as of the period-end:
As of December 31, 2021
10,858,263 sharesAs of December 31, 20203.

10,940,270 shares

Average number of shares for the period (cumulative):
As of December 31, 2021
343,987,048 shares
As of December 31, 2020
343,879,649 shares[Reference]
Summary of Unconsolidated Results
1. Unconsolidated Results for Fiscal 2021 (January 1, 2021 – December 31, 2021)(Percentages displayed for net sales, operating income, ordinary income and net income attributable toowners of the parent are comparisons with the previous fiscal year.)(1) Unconsolidated Operating Results(Millions of yen)
Net Sales

Fiscal 2021
Fiscal 2020

252,721220,812(Change)
14.5
(6.6)

Net Income
per Share (Yen)
Fiscal 2021
Fiscal 2020

82.32
45.84

Operating Income

40,30027,973(Change)
44.1(13.1)

Ordinary Income

41,81530,476(Change)
37.2
(6.9)

Net Income Attributableto Owners of the Parent(Change)
28,315
79.6
15.762(34.3)

Fully Diluted
Net Income
per Share (Yen)
82.25
45.80

(2) Unconsolidated Financial Position(Millions of yen)
Shareholders’
Net Assets
Equity Ratio (%)
per Share (Yen)
968,040
402,99641.6
1,170.28
Fiscal 2021
946,036
387,49640.9
1,125.74
Fiscal 2020
[Reference] Shareholders’ equity:
For fiscal 2021: ¥402,581 million
For fiscal 2020: ¥387,167 million
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 and assumptions 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 2022” on page 7 of the Attachment for the assumptions
used.
Access to Documents and Other Materials Relating to the Year-End Results Briefing to Be Held on February 10, 2022
Related documents and materials will be disclosed through TDnet together with on our website on the day of earning
announcement. The video of the briefing will be posted on the Company’s website after the briefing 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 ...............................................................................................

5(3) Overview of Cash Flows ........................................................................................................

6(4) Outlook for Fiscal 2022 ..........................................................................................................

7(5) Basic Policies Related to Profit Distribution and Dividends in Fiscal 2020 and 2021 .............

9

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

9(1) Fundamental Management Policies .......................................................................................

9(2) Management Indicator Targets, Medium- to Long-Term Strategies
and Issues to Be Addressed ................................................................................................

9

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

10

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

11(1) Consolidated Balance Sheets ................................................................................................

11(2) Consolidated Statements of Income and Consolidated Statementsof Comprehensive Income .....................................................................................................

13(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 to Presentation Methods .........................................................................................

20

Changes to Accounting Estimates .........................................................................................

20

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

20

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

26

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

26

1. Qualitative Information regarding Business Results(1) Overview of Consolidated Business Results
In the fiscal year ended December 31, 2021 (“fiscal 2021”), the world economy continued to recover overall as economic
activities have been invigorated with the easing of restrictions due to rising COVID-19 vaccination rates. However, new
COVID-19 infection numbers continued to rise due to the emergence of new variants, raw material and fuel prices remaining
high, and the semiconductor shortage and logistics disruptions grew more serious. Consequently, consolidated operating
results for fiscal 2021 are as follows: net sales rose ¥87,573 million, or 16.2%, compared with the previous fiscal year to¥629,370 million; operating income increased ¥27,914 million, or 63.0%, to ¥72,256 million; ordinary income increased¥29,024 million, or 73.0%, to ¥68,765 million; and net income attributable to owners of the parent increased ¥34,691 million,
or 1,349.5%, to ¥37,262 million. In fiscal 2021, Kuraray recorded an extraordinary loss comprising a loss on litigation of¥4,296 million in connection with a fire in May 2018 at a Group subsidiary in the United States and a disaster loss of ¥3,284
million caused by a suspension of production at some facilities operated by a Group subsidiary in the United States due toa cold wave that swept across the southern United States.

(Millions of yen)
FY2020

FY2021

Vinyl Acetate

257,114

Operating
Income40,779Isoprene

50,390Change304,690

Operating
Income57,72647,575

Operating
Income16,946

3,808

61,9405,694

11,5501,885

124,980

2,994

139,078

8,189

14,0985,194

Fibers and Textiles

54,4082,155

61,082

5,302

6,674

3,147

Trading

124,438

3,606

144,027

4,852

19,588

1,246

Others41,707

214

47,615

908

5,908

694

(111,242)(9,217)(129,064)(10,417)(17,822)(1,200)541,797

44,341

629,370

72,256

87,573

27,914

Net Sales

Functional
Materials

Elimination &Corporate
Total

Net Sales

5

Net Sales

Results by Business Segment
Vinyl Acetate
Sales in this segment increased 18.5% year on year to ¥304,690 million, and segment income rose 41.6% year on year to¥57,726 million.

(1) Although performance was impacted by high raw material and fuel prices, sales of PVA resin increased for a wide
range of applications as global demand has been recovering. Sales of optical-use poval film were brisk against a
backdrop of robust demand for LCD panels continuing from the second half of the previous fiscal year. The sales
volume of PVB film rose year on year but were affected by a decrease in the production of automobiles caused by ashortage of semiconductors from the third quarter. Sales of water-soluble PVA film steadily expanded for use in unit
dose detergent packets, including for laundry and dish detergents.
(2) The sales volume of EVAL™ ethylene vinyl alcohol copolymer (EVOH resin) increased due to a recovery in demand
for gas tank applications and continuing solid demand for food packaging applications but were affected by high raw
material and fuel prices from the beginning of the year and a decrease in the production of automobiles from the third
quarter.

Isoprene
Sales in this segment increased 22.9% year on year to ¥61,940 million, and segment income rose 49.5% year on year to¥5,694 million.

(1) The sales volume of isoprene chemicals and SEPTON™ thermoplastic elastomer increased due to a recovery indemand.
(2) Sales of GENESTAR™ heat-resistant polyamide resin expanded as demand for electric and electronic device
applications and automotive applications increased, despite the impact of rising costs associated with raw materials,

6fuel and logistics.

Functional Materials
Sales in this segment increased 11.3% year on year to ¥139,078 million, and segment income rose 173.4% year on yearto ¥8,189 million.

(1) In the methacrylate business, sales of spatter-blocking barrier panels and displays remained steady, and market
conditions stayed strong.
(2) In the medical business, demand for new Kuraray products was strong in the dental materials business, especially inEurope and the United States, and sales expanded.
(3) In the environmental solutions business, demand increased, especially for water treatment applications in Europe andthe United States, and sales of activated carbon remained steady.

Fibers and Textiles
Sales in this segment rose 12.3% year on year to ¥61,082 million while segment income increased 146.1% year on year
to ¥5,302 million.

(1) Sales of CLARINO™ man-made leather remained steady, especially for use in shoes.
(2) In fibers and industrial materials, the sales volume of KURALON™ and VECTRAN™ expanded, and sales volume
increased.
(3) In consumer goods and materials, demand for KURAFLEX™ in the restaurant industry was weak.

7

Trading
Sales in this segment increased 15.7% year on year to ¥144,027 million, and segment income rose 34.6% to ¥4,852
million.

(1) In fiber-related businesses, sales of sports wear and CLARINO™ man-made leather were brisk.
(2) Sales of resins and chemicals expanded in line with higher demand, mainly in the Chinese market.

OthersIn other business, domestic affiliates saw sales recover, resulting in an increase in segment sales of 14.2% year on yearto ¥47,615 million and segment income rising 324.0% to ¥908 million.

(2) Overview of Financial Position
Total assets increased ¥39,429 million from the end of the previous fiscal year to ¥1,091,014 million mainly because of a¥24,677 million increase in inventories, a ¥19,868 million increase in construction in progress, and a ¥18,595 million increasein notes and accounts receivable—trade, despite a ¥32,377 million decrease in cash and cash deposits. Factors that
contributed to liabilities included a ¥13,480 million increase in notes and accounts payable—trade, a ¥6,512 million increase
in income taxes payable, and a net increase in long-term loans payable of ¥6,047 million. Total liabilities decreased ¥24,691
million to ¥511,411 million due to factors that included the redemption of commercial paper totaling ¥20,000 million, theredemption of bonds totaling ¥20,000 million, and a ¥13,610 million decrease in other current liabilities accompanying mainly
a decrease in other accounts payable.
Total net assets rose ¥64,121 million to ¥579,602 million. Equity attributable to owners of the parent amounted to ¥559,984
million, for an equity ratio of 51.3%.

8

(3) Overview of Cash Flows
Cash Flows from Operating Activities:
Net cash provided by operating activities totaled ¥78,221 million. Cash provided included ¥58,697 million from income
before income taxes and noncontrolling interests, ¥59,003 million in depreciation and amortization and ¥12,244 million
increase in notes and accounts payable – trade. Cash used included a ¥13,437 million increase in notes and accounts
receivable – trade, a ¥17,537 million increase in inventories, ¥14,127 million in income taxes paid, and a ¥24,104 million
loss on litigation paid.

Cash Flows from Investing Activities:
Net cash used in investing activities totaled ¥65,595 million. Contributing factors included ¥68,408 million used for thepurchase of tangible fixed assets and intangible fixed assets.

Cash Flows from Financing Activities:
Net cash used in financing activities was ¥47,447 million. Cash provided included ¥6,212 million in proceeds from longterm loans payable. Cash used included a ¥20,000 million for the redemption of commercial paper, ¥20,000 million for theredemption of corporate bonds, and cash dividends paid totaling ¥13,414 million.
The above factors along with the effect of exchange rate changes on cash and cash equivalents resulted in a ¥30,596
million decrease in cash and cash equivalents at the end of the fiscal year to ¥151,487 million.

Fiscal Year Ended
December 31, 2020
79,947(Millions of yen)
Fiscal Year Ended
December 31, 2021
78,221

Net cash used in investing activities(64,025)(65,595)

Net cash used in financing activities

91,508(47,447)(1,541)

4,224

105,888(30,596)

75,967

182,084228－

182,084

151,487

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,
2017
2018
2019
2020
2021
71.7
58.6
53.0
47.4
51.3
96.0

57.1

46.2

35.9

31.5

0.7

2.9

2.5

4.3

3.9

116.0

62.7

68.5

57.0

50.9

9

Notes:Equity ratio: Total net assets excluding both subscription rights to shares and noncontrolling interests/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 the closing 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.
5. In the fiscal year ended December 31, 2018, the Company changed its inventory evaluation method. As the changes to thecorresponding method have been applied retroactively, the figures for the fiscal year ended December 31, 2017 have been retroactively
adjusted.

(4) Outlook for Fiscal 2022
As regards to the economic environment over the next year, it is expected that vaccinations and other measures will limit
the pandemic’s effects on economic activities. On the other hand, rising global geopolitical risks, soaring prices of raw
materials and fuels, prolonged stagnation in logistics and continuing high logistics costs have become a source of concern
for our business performance.
Furthermore, we recorded an extraordinary loss in fiscal 2021 related to the litigation over the fire at the U.S. subsidiary,
and the litigation is still ongoing for some plaintiffs. Based on these circumstances, the outlook for fiscal 2022 is as follows.

Net sales
Operating income
Ordinary income
Net income attributable toowners of the parent(Billions of yen, rounded to the nearest hundred million)
Forecast for Fiscal
Fiscal 2021
Change (Adjusted)
2022
629.4
650.0
―
72.3
73.0
―
68.8
69.0
―
37.3

43.0

―

For the forecast of operating results for fiscal 2022, we assume average exchange rates of ¥110 to the U.S. dollar and¥130 to the euro, as well as a domestic naphtha price of ¥58,000 per kiloliter.
Due to the adoption of the “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29) from the fiscal year
ending December 31, 2022, the above forecasts of consolidated performance for fiscal 2022 reflect the newly applied
accounting standard. Therefore, the rate of change from the previous year is not shown.

10[Reference] Forecast of Results by Segment for Fiscal 2022

Vinyl Acetate
Isoprene
Functional Materials
Fibers and Textiles
Trading
Other BusinessElimination & Corporate
Total(Billions of yen, rounded to the nearest hundred million)
Net Sales
Operating Income
Forecast for Fiscal
Forecast for Fiscal
Fiscal 2021
Fiscal 2021
2022
2022
304.7
320.0
58.3
62.0
61.9
65.0
6.1
6.5
142.4
145.0
8.7
9.0
61.1
60.0
5.6
3.0
144.0
58.0
4.8
5.0
44.3
44.0
1.2
1.0
(129.1)(42.0)(12.4)(13.5)
629.4
650.0
72.3
73.0

On January 1, 2022, the Company revised its organizational structure and changed the segment classification of the aquabusiness from “Other” to “Functional Materials.” In addition, the method of allocating eliminations of profits from some internaltransactions among segments and within the corporate has been changed. In the above table, figures presented under
forecast for fiscal 2022 reflect these changes. Figures presented under result for fiscal 2021 reflect changes in profit
allocation method and segment classifications. Adoption of accounting standard is not reflected in fiscal 2021 figures.
Figures for Trading segment net sales and elimination & corporate for fiscal 2022 have significantly changed compared tofiscal 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 Recognition and other factors. Because of
these changes, revenues from such transactions, which have previously been recorded on the basis of total transactional
value, are now recorded on a net basis.

(5) Basic Policies Related to Profit Distribution and Dividends in Fiscal 2021 and 2022
The Company positions the distribution of profits to all shareholders as a priority management issue. In fiscal 2021, ourbasic policy was to ensure a total return ratio of at least 35% as a proportion of net income attributable to owners of theparent and an annual dividend per share of ¥40.
Under this policy, the interim dividend in fiscal 2021 was ¥20 per share, and the year-end dividend is expected to amount¥20, for a total annual dividend of ¥40 per share.
In fiscal 2022, our basic policy is to ensure a total return ratio of at least 35% as a proportion of net income attributable toowners of the parent, and an annual dividend of at least ¥40 per share. We will strive to enhance shareholder returns though
the expansion of profit. We therefore plan to pay out an annual dividend of ¥42 comprising an interim dividend of ¥21 and a
year-end dividend of ¥21, having set a prerequisite of recording ¥43.0 billion in net income attributable to owners of theparent.
In fiscal 2022, the Company will execute share buyback up to either 11 million shares or ¥10 billion. Further detail of sharebuyback is in the section “4. Consolidated Financial Statements and Notes, (5) Notes regarding Consolidated Financial
Statements, Significant Subsequent Information”.

112. Management Policies(1) Fundamental Management Policies
Kuraray’s mission is: “For people and the planet—to achieve what no one else can.” Based on this, in 2017 the Company
established the Kuraray Vision 2026 long-term vision, which we aim to realize by 2026, the centennial of the Company's
founding. When formulating the new medium-term management plan “PASSION 2026”, which starts from 2022, we partiallyrevised this vision, adding the message “contributing to customers, society, and the planet” to clarify that we give back to awide range of stakeholders. The new Kuraray Vision 2026 outlines the aim of being a: “Specialty Chemical Company growing
sustainably by incorporating new foundational platforms into its own technologies and contributing to customers, society,and the planet.”(2) Management Indicator Targets, Medium- to Long-Term Strategies and Issues to Be Addressed
In line with “PASSION 2026”, the Group set the three challenges to tackle listed below to realize our 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, both within and outside
the Company
3) Transformation of people and organization
Transform people and organization via the digital-driven process innovation and the promotion of diversity which will, in
turn, help us bring to bear a broad range of ideas
By steadily carrying out management strategies outlined in the medium-term management plan “PASSION 2026”, the Groupaims to achieve net sales of ¥750.0 billion and operating income of ¥100.0 billion in fiscal 2026—the centennial of Kuraray’s
founding. During the period of “PASSION 2026”, we will ensure capital investment, such as in the Thai Isoprene base, thePolish water-soluble PVA film production base, and the Calgon Carbon Corporation new facility leads to accomplishments.
We will also focus resource allocation on businesses that aim for growth, such as EVAL ethylene vinyl alcohol copolymer,
GENESTAR heat-resistant polyamide resin, VECSTAR liquid crystalline polymer film, dental materials, and optical use povalfilm. In this way, we will strive to create a more upgraded business portfolio. The Group will continue taking on thesechallenges as a sustainably growing specialty chemical company toward the centennial in 2026.
In addition, there was a fire that resulted in injuries of outside contract workers at a U.S. subsidiary in May 2018, and civil
lawsuits were filed seeking damages. Only some of the plaintiffs’ lawsuits are still active. To ensure a similar fire does notoccur again, safety inspections have been conducted at our main overseas chemical plants since 2019 under the guidanceof the Kuraray headquarters in an effort to revise and strengthen safety measures. From 2022, we will establish a new
Global Process Safety Management Audit Team and strengthen safety audits for chemical and activated carbon plants.
Furthermore, in October 2021, Kuraray confirmed that its servers were hacked and some of its data was leaked. Through asubsequent audit, we determined that some of the data that may have leaked included personal data, such as the names
and company contact information of business partners and Group employees. We have taken the necessary measures,
including contacting the relevant parties. With the help of an external specialist organization, we will work to further
strengthen our data security and ensure our data management system is much stricter.

12

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 matterswhile taking into account various circumstances in Japan and overseas.

13

4. Consolidated Financial Statements and Notes(1) Consolidated Balance Sheets(Millions of yen)
December 31, 2020

December 31, 2021

Cash and cash deposits

184,319

151,942

Notes and accounts receivable–trade117,172

135,768

Short-term investment securities

7,924

3,855

Merchandise and finished goods

86,555103,505

Work in process

14,105

15,699Raw materials and supplies

31,968

38,100Other

19,596

21,745

(439)

(443)

461,202

470,174

Buildings and structures, net

84,60488,801

Machinery, equipment and vehicles, net

200,152

200,500

Land

22,204

22,648Construction in progress

97,451

117,319

Other, net

24,97825,997429,391455,266

Goodwill

51,10552,635

Customer-related assets

28,80029,176

Other

31,14332,243

Total intangible fixed assets
Investments and other assets

111,049

114,055

Investment securities

25,477

25,689140

121

ASSETS
Current Assets

Allowance for doubtful accounts
Total current assets
Noncurrent Assets
Tangible fixed assets

Total tangible fixed assets
Intangible fixed assets

Long-term loans receivable
Net defined benefit assets

2,097

3,066

Deferred tax assets

14,652

13,980

Others

7,597

8,686

(24)

(26)

49,94151,517

Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total Assets

590,382

620,839

1,051,584

1,091,014

(Millions of yen)
December 31, 2020

December 31, 2021

Notes and accounts payable–trade36,16149,641

Short-term loans payable

34,48034,480Commercial paper

20,000―Current portion of bonds payable

20,000―29

55,013

Accrued expenses

17,956

19,863

Income taxes payable

6,621

13,133

Provision for bonuses

6,745

7,996

LIABILITIESCurrent Liabilities

Current portion of long-term loans payable

Other provision
Other
Total current liabilities
Noncurrent Liabilities

202

89

52,856

39,246

195,053

219,464

Bonds payable

60,00060,000Long-term loans payable

206,881

157,945

Deferred tax liabilities

11,21812,022375

375

Provision for environmental measures

3,364

365

Net defined benefit liabilities

25,44925,629Asset retirement obligations

4,383

4,821

Other

29,37630,787

341,050

291,947

536,103

511,411

Capital stock

88,95588,955

Capital surplus

87,17887,166

Retained earnings

336,050

359,898

Treasury stock(16,006)(15,885)

496,177

520,134

Deferred gain or losses on hedges

6,847
(376)

7,273
219

Foreign currency translation adjustments

1,470

34,648Remeasurements of defined benefit plans(5,321)(2,291)

Total accumulated other comprehensive income

2,620

39,850

Provision for directors’ retirement benefits

Total noncurrent liabilities
Total Liabilities
NET ASSETS
Shareholders’ Equity

Total shareholders’ equity
Accumulated Other Comprehensive Income
Valuation difference on available-for-sale securities

328

414

Noncontrolling Interests

16,354

19,203

Total Net Assets

515,481579,602

1,051,584

1,091,014

Subscription Rights to Shares

Total Liabilities and Net Assets

15

(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income
Consolidated Statements of Income(Millions of yen)
Fiscal 2020
(January 1, 2020 –December 31, 2020)

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

Net sales

541,797629,370

Cost of sales

376,386

425,234

Gross profit

165,411204,136

Selling expenses

31,46438,721

General and administrative expenses

89,604

93,157

Total selling, general and administrative expenses

121,069

131,879

44,341

72,256

Interest income

208

141

Dividend income

568

553

Equity in earnings of affiliates

257

261

Other

1,516

1,482

Total non-operating income

2,550

2,439

1,442

1,627

514

188

Selling, general and administrative expenses

Operating income
Non-operating income

Non-operating expenses
Interest expenses
Foreign exchange loss
Loss on disposal of tangible fixed assets

997

639

Other

4,198

3,475

Total non-operating expenses

7,152

5,930

39,74068,765

937

563

1,642

544

―

510

Compensation for property transfer―

422

Gain on reversal of share acquisition rights to shares

285

―

2,866

2,040

23,196

4,296

Disaster loss

―

3,284

Impairment loss

―

1,569

4,460

1,350

632

1,183

Ordinary income
Extraordinary income
Gain on sale of investment securities
Insurance income
Subsidy income

Total extraordinary income
Extraordinary loss
Loss on litigation

Costs related to the suspension of operations
Loss on disposal of tangible fixed assets
Loss on tax purpose reduction entry of non-current assets―

423

Loss on liquidation of businesses

5,189

―

Total extraordinary loss

33,47912,1089,127

58,697

Income before income taxes and noncontrolling interests

16

Fiscal 2020
(January 1, 2020 –December 31, 2020)

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

Income taxes—current

8,367

19,718

Income taxes for prior periods
Income taxes—deferred―(2,551)

1,386
(767)

Total income taxes

5,815

20,336

Net income

3,311

38,360

740

1,098

2,570

37,262

Net income attributable to noncontrolling interests
Net income attributable to owners of the parent

17

Consolidated Statements of Comprehensive Income(Millions of yen)

Net income

Fiscal 2020
(January 1, 2020 –December 31, 2020)

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

3,311

38,360(1,075)426

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

(269)

793

(13,314)

33,130

(82)

3,030

(14,741)

37,380(11,430)

75,741

Owners of the parent(11,804)

74,491

Noncontrolling interests

374

1,249

Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total other comprehensive income
Quarterly comprehensive income
Comprehensive income attributable to:18

(3) Consolidated Statements of Changes in Net Assets
Fiscal 2020 (January 1, 2020 – December 31, 2020)(Millions of yen)
Capitalstock
Balance at January 1,
2020
Changes of items
during the period
Cash dividends
Net loss attributable toowners of the parent
Changes resulting fromadditions toconsolidation
Purchase of treasury
stock
Disposal of treasury
stock
Other
Net changes of items
other thanshareholders’ equity
Total changes of items
during the period
Balance at December 31,
2020

88,955

Capitalsurplus87,197

Shareholders’ equity
Retained
Treasury
earnings
stock348,289(16,286)

Total shareholders’equity508,156(14,784)(14,784)

2,570

2,570

(24)

(24)

(19)
(0)

(2)

(2)

281

262
(0)
―

―

(19)

(12,238)

279(11,978)

88,95587,178336,050(16,006)

496,177

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, 2020
7,922
(263)
14,575(5,238)16,995663
12,729 538,545
Changes of items during
the period
Cash dividends―(14,784)
Net loss attributable toowners of the parent―
2,570
Changes resulting fromadditions toconsolidation(24)
Purchase of treasury
stock
―
(2)
Disposal of treasury
stock
―
262
Other
―
(0)
Net changes of items
other thanshareholders’ equity(1,075)(112)(13,104)(82)(14,375)(335)
3,624 (11,085)
Total changes of items
during the period(1,075)(112)(13,104)(82)(14,375)(335)
3,624 (23,064)
Balance at December 31,
2020
6,847
(376)
1,470
(5,321)
2,620
328
16,354 515,481

19

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 income attributableto owners of theparentPurchase of treasury
stock
Disposal of treasurystock
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
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, 2021
6,847
(376)
1,470
(5,321)
2,620
328
16,354
Changes of items during
the period
Cash dividends―
Net income attributableto owners of the parent―
Purchase of treasury
stock―
Disposal of treasurystock―
Net changes of items
other thanshareholders’ equity
426
595
33,1783,030
37,22986
2,848
Total changes of items
during the period
426
595
33,1783,030
37,22986
2,848
Balance at December 31,
2021
7,273
219
34,648(2,291)
39,850414
19,20320

Total net
assets515,481(13,414)37,262(2)
111
40,16564,121
579,602(4) Consolidated Statements of Cash Flows(Millions of yen)
Fiscal 2020

Fiscal 2021

(January 1, 2020 –(January 1, 2021 –December 31, 2020)

December 31, 2021)

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

9,127

58,697

Depreciation and amortization

62,45959,003

(3)
(937)

(29)
(563)

Loss on litigation

23,196

4,296

Loss on liquidation of businesses

5,189

―

Impairment loss

―

1,569

Loss on disposal of tangible fixed assets

632

1,183

Foreign exchange losses (gains)463(2,610)Interest and dividend income

(777)

(694)

Interest expenses

1,442

1,627

Decrease (increase) in notes and accounts receivable – trade

2,637(13,437)

Decrease (increase) in inventories

16,731(17,537)

Increase (decrease) in notes and accounts payable – trade(3,224)

12,244

Increase (decrease) in allowance for doubtful accounts
Loss (gain) on sale of investment securities

274

858

Increase (decrease) in net defined benefit liabilities

2,524

2,273

Decrease (increase) in net defined benefit assets

(383)

(624)

Other, net

8,244

10,899Subtotal

127,596

117,157

921

833

Increase (decrease) in provision for bonuses

Interest and dividends received
Interest expenses paid

(1,402)(1,537)

Income taxes (paid) refund(9,624)(14,127)

Loss on litigation paid

(37,543)(24,104)

Net cash provided by (used in) operating activities

79,94778,221

Net decrease (increase) in time deposits

4,624

(150)

Net decrease (increase) in short-term investment securities

14,625

6,000

(95)

(88)

Proceeds from sale and redemption of investment securities

2,760

1,647

Purchase of tangible fixed assets and intangible fixed assets(83,490)(68,408)

Payments for disposal of tangible fixed assets and intangible
fixed assets(1,425)(1,774)

Net cash provided by (used in) investing activities

Purchase of investment securities

21

(Millions of yen)
Fiscal 2020

Fiscal 2021

(January 1, 2020 –(January 1, 2021 –December 31, 2020)

December 31, 2021)

Proceeds from sales of tangible fixed assets and intangible fixed
assets69

92

Other, net(1,095)(2,912)

Net cash provided by (used in) investing activities(64,025)(65,595)(351)―

Net increase (decrease) in commercial paper(4,000)(20,000)

Proceeds from long-term loans payable

79,274

6,212

Repayment of long-term loans payable

(34)

(29)

30,000―

Payment for redemption of corporate bonds―(20,000)

Purchase of treasury stock

(2)

(2)

105

82

(14,784)(13,414)

Proceeds from stock issuance to minority interests

3,559

1,820

Cash dividends paid to noncontrolling interests

(308)

(220)

Other, net(1,949)(1,894)

Net cash provided by (used in) financing activities

91,508(47,447)(1,541)

4,224

Net Increase (Decrease) in Cash and Cash Equivalents

105,888(30,596)

Cash and Cash Equivalents, Beginning of the Period

75,967

182,084228―

182,084

151,487

Net cash provided by (used in) financing activities
Net increase (decrease) in short-term loans payable

Proceeds from corporate bonds

Proceeds from sale of treasury stock
Cash dividends paid

Effect of Exchange Rate Changes on Cash and Cash Equivalents

Increase in Cash and Cash Equivalents from Newly Consolidated
Subsidiaries
Cash and Cash Equivalents, End of the Period22(5) Notes regarding Consolidated Financial Statements
Notes regarding Going Concern Assumptions
None
Changes to Presentation Methods(Regarding Consolidated Balance Sheets)
The “current portion of long-term loans payable,” previously included in “short-term loans payable” under current liabilities,
is listed as a separate line item from the year ended December 31, 2021 due to an increase in its financial significance.
The previous year’s Consolidated Financial Statements have been amended to reflect this change in presentation.
As a result, on the Consolidated Balance Sheet, “short-term loans payable” of ¥34,509 million presented under current
liabilities as of the previous year-end has been reclassified as “short-term loans payable” of ¥34,480 million and “current
portion of long-term loans payable of ¥29 million.”
Changes to Accounting Estimates(Income Taxes for Prior Periods)
Regarding the preferential tax programs in the Belgian tax code, which were applied to Kuraray’s Belgian subsidiary inprevious fiscal years, the ruling of the European General Court (which invalidated the European Commission’s finding of alegal violation) was dismissed by the Court of Justice of the European Union and the case was sent back to the lower
court for reassessment. As a result, the subsidiary again revised its final tax burden risk ratio of ¥2,785 million (21 million
euros), which anticipates additional taxation. The estimate was changed, and the original estimate and the difference fromthat were recorded as income taxes for prior periods.
As a result, fiscal 2021 net income decreased ¥1,386 million.
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 conduct periodic investigations to determine the
distribution of management resources and evaluate their business results.

Kuraray adopts an in-house company system where each in-house company conducts business activities 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 of Kuraray 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 product group based on the respective in-housecompanies and the Trading segment.

The Vinyl Acetate segment manufactures and markets functional resins and film, including PVA, PVB and EVAL. The

23

Isoprene segment manufactures and markets SEPTON thermoplastic elastomer, isoprene-related products and
GENESTAR. The Functional Materials segment manufactures and markets methacrylic resin, medical products andcarbon materials. 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 manmade leather, and conducts planning and marketing for other products produced by the Kuraray Group and othercompanies.

2. Methods for Calculating Reporting Segment Net Sales, Income and Loss, Assets and Other Items
The accounting method applied to reported business segments is the same as that used in creating the consolidated
financial statements. Profits from reported segments are operating income, and intersegment sales and transfers are
based on the prevailing market prices.

24

3. Net Sales, Income and Loss, Net Assets and Other Items by Reporting Segment
Fiscal 2020 (January 1, 2020 to December 31, 2020)(Millions of yen)
Reporting Segment
Vinyl Isoprene Functional Fibers Trading
AcetateMaterials andTextilesTotal

Net sales
Outside215,702 26,943 106,650 40,872 122,012 512,180
customers
Inter-segment
sales and
41,412 23,447
18,330 13,536
2,426 99,152
transfers
Total
257,114 50,390 124,980 54,408 124,438 611,332
Segment income
40,7793,808
2,994 2,155
3,606 53,344(loss)
Segment assets 391,914 108,852 205,673 70,378 43,422 820,241
Other items
Depreciation
andamortization
35,436
3,058
12,395 3,768
97 54,756(other than
goodwill)
Impairment
—
—
4,475
—
—
4,475
loss
Amortization of
1,244
—
2,521
—
—
3,766
goodwill
Balance of
goodwill at end
14,741—36,363—— 51,105of current
periodInvestments inequity method——— 2,472—
2,472
affiliates
Increase intangible fixed
assets and21,656 26,615
11,323 8,228
314 68,139
intangible fixed
assetsOther
Business1

Total

Adjustment2 Consolidated
Statements
3of Income

29,617 541,797—

541,797

12,089 111,242(111,242)—

41,707 653,039(111,242)

541,797

53,559(9,217)44,341

48,168 868,410

183,173

1,051,584

214

1,085

55,842

2,850

58,693

—

4,475

—

4,475

—

3,766

—

3,766

—

51,105—

51,105

—

2,472

—

2,472

2,563

70,702

5,997

76,700Notes:
1.

The “Other Business” category incorporates operations not included in business segment reporting, including

the aqua business and engineeringbusiness.
2.

Adjustment is as follows: Included within segment loss of ¥9,217 million is the elimination of intersegment

transactions of ¥2,017 million and corporate expenses of ¥11,234 million. Corporate expenses mainly comprise
headquarters’ general and administrative expenses and the submitting company’s basic research expenses.
3.

Segment income is adjusted to agree with operating income in the consolidated statements of income.

4.

Adjustment is as follows: Included with segment assets of ¥183,173 million is the elimination of intersegment

transactions of ¥32,157 million and unallocated corporate assets of ¥215,331 million. Corporate assets mainly comprisethe submitting company’s surplus funds, long-term investments and assets related to basic research and administrative
divisions at headquarters.
5.

The ¥4,475 million impairment loss for Functional Materials is included in the loss on liquidation of businesses

presented under extraordinary loss.

25

Fiscal 2021 (January 1, 2021 to December 31, 2021)(Millions of yen)
Reporting Segment
Vinyl Isoprene Functional Fibers Trading
AcetateMaterials andTextilesTotal

Net sales
Outside254,814 31,994 118,085 46,023 141,306 592,224
customers
Inter-segment
sales and
49,875 29,946
20,992 15,058
2,721 118,595
transfers
Total
304,690 61,940 139,078 61,082 144,027 710,819
Segment income
57,726
5,694
8,189 5,302
4,852 81,766(loss)
Segment assets 421,062 124,467 225,987 76,741 50,316 898,575
Other items
Depreciation
andamortization
32,6182,487
11,459 4,300
86 50,952(other than
goodwill)
Impairment
10
—
26
—
—
37
loss
Amortization of
1,290
—
2,368
—
—
3,659
goodwill
Balance of
goodwill at end
14,764—37,870—— 52,635
of current
periodInvestments inequity method——— 2,967—
2,967
affiliates
Increase intangible fixed
assets and20,301 14,665
17,118 5,711
555 58,352
intangible fixed
assetsOther
Business1

Total

Adjustment2 Consolidated
Statements
3of Income37,146 629,370—

629,370

10,469 129,064(129,064)—

47,615 758,435(129,064)

629,370

82,674(10,417)

72,25647,898 946,474

144,539

1,091,014

908

1,197

52,1503,194

55,344

51

88

1,481

1,569

—

3,659

—

3,659

—

52,635—52,635

—

2,967

—

2,967

1,416

59,7696,177

65,947

Notes:
1.

The “Other Business” category incorporates operations not included in business segment reporting, including

the aqua business and engineering business.
2.

Adjustment is as follows: Included within segment loss of ¥10,417 million is the elimination of intersegment

transactions of ¥1,773 million and corporate expenses of ¥12,191 million. Corporate expenses mainly comprise
headquarters’ general and administrative expenses and the submitting company’s basic research expenses.
3.

Segment income is adjusted to agree with operating income in the consolidated statements of income.

4.

Adjustment is as follows: Included with segment assets of ¥144,539 million is the elimination of intersegment

transactions of ¥32,478 million and unallocated corporate assets of ¥177,018 million. Corporate assets mainly comprisethe submitting company’s surplus funds, long-term investments and assets related to basic research and administrative
divisions at headquarters.
5.

The ¥1,418 million impairment loss for Functional Materials is included in the loss on liquidation of businesses

presented under extraordinary loss.

26

Related Information
Fiscal 2020 (January 1, 2020 – December 31, 2020) Information by Each Product and Service
1. Information by Each Product and Service

Net sales to outside customers(Millions of yen)

Vinyl Acetate

Isoprene

254,180

50,341

Functional
Materials
124,899

Fibers &Textiles
76,078Other Business

Total

36,297541,797

Notes:
Principal products of each segment are as follows:
Vinyl Acetate:

PVA resin and film, PVB resin and film, EVAL resin and others

Isoprene: SEPTON thermoplastic elastomer, isoprene chemicals, GENESTAR heat-resistant polyamide resin and others
Functional Materials: Methacrylic resin, medical products, carbon materials and others
Fibers and Textiles: KURALON, CLARINO man-made leather, KURAFLEX non-woven fabrics, MAGIC TAPE hook andloop fasteners, polyester and others
Other Business: Aqua business, engineering business and others

2. Information by Geographical Segment(1) Net Sales
Japan
157,973(Millions of yen)
United States
100,300

China
72,568Europe118,641

Asia
68,058Other Area
24,254

Total
541,797

Note: Net sales are classified by country or area based on customer location.
(2) Tangible Fixed Assets(Millions of yen)Japan

United States

Thailand

Other Area

Total

186,522

114,684

50,48477,700429,391

3. Major Customers
No information is available as there is no single outside customer accounting for 10% or more of the Company’s total net
sales.

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

Information by Each Product and Service

Net sales to outside customers(Millions of yen)

Vinyl Acetate

Isoprene

301,055

60,562Functional
Materials
138,834

Fibers &Textiles
84,015

Other Business

Total

44,903629,370

Notes:
Principal products of each segment are as follows:
Vinyl Acetate:

PVA resin and film, PVB resin and film, EVAL resin and others

Isoprene: SEPTON thermoplastic elastomer, isoprene chemicals, GENESTAR heat-resistant polyamide resin and others
Functional Materials: Methacrylic resin, medical products, carbon materials and others
Fibers and Textiles: KURALON, CLARINO man-made leather, KURAFLEX non-woven fabrics, MAGIC TAPE hook andloop fasteners, polyester and others
Other Business: Aqua business, engineering business and others27

2. Information by Geographical Segment(1) Net Sales
Japan
170,532(Millions of yen)
United States
116,400

China
86,774

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(Millions of yen)Japan

United States

Thailand

Other Area

Total

185,489

124,469

62,64082,667455,266

3. Major Customers
No information is available as there is no single outside customer accounting for 10% or more of the Company’s total net
sales.
Noncurrent assets and impairment loss by reporting segment
Fiscal 2020 (January 1, 2020 – December 31, 2020)
Omitted because the same information is provided under segment information
Fiscal 2021 (January 1, 2021 – December 31, 2021)
Omitted because the same information is provided under segment information
Amortization of goodwill and unamortized balances by reporting segment
Fiscal 2020 (January 1, 2020 – December 31, 2020)
Omitted because the same information is provided under segment information
Fiscal 2021 (January 1, 2021 – December 31, 2021)
Omitted because the same information is provided under segment information
Negative goodwill by reporting segment
Fiscal 2020 (January 1, 2020 – December 31, 2020)
None
Fiscal 2021 (January 1, 2021 – December 31, 2021)
None

28

Per Share Information

Net assets per share (yen)Basic net income (loss) per share (yen)Diluted net income per share (yen)Fiscal 2020
(January 1, 2020 –December 31, 2020)
1,450.32
7.48
7.47

Fiscal 2021
(January 1, 2021 –December 31, 2021)
1,627.84
108.32108.23

Notes: 1. The basis for the computation of basic and diluted income per share is as follows:
Fiscal 2020
(January 1, 2020 –December 31, 2020)
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 2021
(January 1, 2021 –December 31, 2021)

2,570

37,262

―

―

2,570

37,262

343,879

343,987

―

―

284

295

(284)

(295)

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 Information
Purchase of treasury stock

At a meeting of the Board of Directors held on February 9, 2022, the Company resolved to execute share buyback asfollows, pursuant to Article 156 of the Companies Act as applied pursuant to Article 165, Paragraph 3, of the same act.

1. Reason for the share buyback
The Company will execute a share buyback in order to strengthen shareholder returns and improve capital efficiency, as
well as to enable a flexible capital policy in the future.

2. Purchase Details(1) Type of shares to be purchased: Common stock of the Company(2) Total number of shares to be purchased: 11,000,000 shares (upper limit)
Ratio to the total number of issued shares (excluding treasury stock): 3.20%

29

(3) Total purchase price: ¥10,000 million (upper limit)(4) Purchase method: Market purchase based on a discretionary transaction agreement for the acquisition of treasury
stock(5) Purchase period: February 10, 2022 to June 30, 202230