(Reference Translation)
February 7, 2020

Osaka Soda Co., Ltd.
CONSOLIDATED FINANCIAL RESULTS
For the Third Quarter of the Fiscal Year ending March 31, 2020
(Prepared under Japan GAAP, unaudited)

Company name:

Osaka Soda Co., Ltd.

Stock Exchange Listing:Tokyo

Securities code:

4046

URL:

http://www.osaka-soda.co.jp

Representative:

Kenshi Terada, Representative Director, President & Chief Operating Officer

For inquiry:

Yoshihiro Ueda, Lead Executive Officer, General Manager, Administration Division(Telephone: +81-6-6110-1560)

Filing date for quarterly report:

February 10, 2020

Commencement date of dividend payment:－Supplementary materials for the quarterly financial results:

None

Quarterly financial results briefings:

None

1. Consolidated Financial Results(Amounts are rounded down to the nearest million yen)

(1) Results of Operations
Nine Months Ended
December 31, 2019

December 31, 2018

Millions of yen

Change *Millions of yen

Change *Net sales

79,998(2.3)%

81,8509.9%

Operating income

7,419(3.0)%

7,650

36.0%

Ordinary income

7,879(4.6)%

8,255

34.4%

Net income attributable to owners of parent

4,944(12.0)%

5,618

40.9%

Comprehensive income

5,451

73.5%

3,141(52.2)%

Note:

Percent changes for nine months are year-on-year comparisons.

Net income per share(Yen)

Diluted net income per share(Yen)

210.28246.35185.60210.07(2) Financial Condition
December 31, 2019

March 31, 2019

Millions of yen

Ratio

Millions of yen

Ratio

Total assets

114,572－

112,661－

Net assets

69,858－64,548－Equity *69,858－64,548－

－

61.0%

－

57.3%

Equity ratio
Note:

Equity = “Total net assets” minus “Subscription rights to shares”

12. Dividends
Year ending Mar. 31, 2020

Year ending Mar. 31, 2020

Year ended Mar. 31, 2019－－32.50 yen*

30.00 yen－－(Forecast)End of first quarterEnd of second quarterEnd of third quarterEnd of fourth quarter

32.5 yen－

35.00 yen

Full year

65.0 yen－

65.00 yen

Note:

Revisions of dividend forecast from the latest announcement: None

3. Earnings Forecast for the fiscal year ending March 31, 2019
Full-year
Millions of yen

Change*105,000(2.7)%

Operating income

9,600

1.2%

Ordinary income

10,2001.5%

Net income attributable to owners of parent

6,800

0.1%

Net salesNote: Revisions of earnings forecast from the latest announcement: NoneEarnings per share(Yen)

294.51* Notes(1) Changes in significant subsidiaries during the period (Changes in specified subsidiaries resulting in thechange in scope of consolidation): None
(2) Application of accounting methods used specifically for the preparation of quarterly consolidated financial
statements: None
(3) Changes in accounting policies, accounting estimates and restatements of revisions
1) Changes in accounting policies due to revisions of accounting standards, etc.: None
2) Changes in accounting policies other than 1: None
3) Changes in accounting estimates: None
4) Restatement of revisions: None
(4) Number of outstanding shares (common stock)1) Number of shares outstanding at the end of the period (including treasury shares)
As of December 31, 2019:

26,731,415

shares

As of March 31, 2019:

26,090,580

shares2) Number of treasury shares at the end of the period
As of December 31, 2019:3,002,640

shares

As of March 31, 2019:

3,001,554

shares3) Average number of shares outstanding in each period
Nine months ended December 31, 2019:

23,513,924

sharesNine months ended December 31, 2018:

22,806,918

shares2

* Quarterly Review Procedures
The quarterly financial results are exempt from the quarterly review procedures by certified public
accountants or audit firm.

*Financial Forecasts and Other Notes
This material contains forward-looking statements such as earnings forecast about Osaka Soda Co.,
Ltd. and its group companies (“Osaka Soda Group”). These forward-looking statements are based on
the current assumptions and beliefs of Osaka Soda Group in light of the information currently available
to it, and contain known and unknown risks, uncertainties and other factors. Osaka Soda Group
therefore wishes to caution readers that actual results could be materially different from any futureresults.

DISCLAIMER:
This is an English translation of the original Japanese document and is prepared for reference. Should
there be any inconsistency between the translation and the Japanese original, the latter shall prevail.
This translation is subject to change without notice. Osaka Soda Co., Ltd. and/or its group companies
shall individually or jointly accept no responsibility or liability for damage or loss caused by any error,inaccuracy, misunderstanding, or changes with regard to this translation.

34. QUALITATIVE INFORMATION(1)Results of Operations
During the third quarter of fiscal 2019 (April 1 through December 31, 2019), Japan’s economy has continued
to recover moderately against the background of improved employment and income conditions. However, theeconomic outlook remains uncertain due to the prolonged U.S.-China trade friction and the slowdown of theChinese economy.
Under the circumstances, the “BRIGHT-2020” medium-term management plan has entered its second year.
Based on the three basic policies of “creating new growth engines”, “establishing a profitable global business”,
and “completing business structure reform”, Osaka Soda Group has further advanced these measures.
As a result, net sales were ¥79,998 million, a decrease of 2.3% compared to the same period of fiscal 2018.
Operating income was ¥7,419 million, a decrease of 3.0% compared to the same period of fiscal 2018.
Ordinary income was ¥7,879 million, a decrease of 4.6% compared to the same period of fiscal 2018. Net
income attributable to owners of parent was ¥4,944 million, a decrease of 12.0% compared to the same periodof fiscal 2018, due to the loss on valuation of investment securities.
Basic Chemical Products
In Chlor-Alkali, net sales decreased due to a decline in demand in the field of semiconductor, electronicmaterials, and pulp & paper. In Epichlorohydrin, net sales increased due to continued steady sales to domestic
market and volume growth in overseas sales as a result of the stricter environmental and safety regulations inChina.
As a result, Basic Chemical Products reported net sales of ¥36,173 million, down 2.0% compared to the same
period of fiscal 2018.
Functional Chemical Products
In Allyl Ether, net sales increased due to volume growth particularly in China, driven by an increase in demandfor Silane Coupling Agents. In Diallyl Phthalates Resins, net sales were unchanged from the previous fiscal
year due to the impact of foreign exchange rates, though sales volume increased mainly for UV curable inks.
In the synthetic rubber field, although Epichlorohydrin Rubber was affected by the worldwide decline inautomobile production, Acrylic rubber expanded its use in the market by focusing on cultivating new customers
and developing new applications in Japan and overseas.
In Separation Media in Pharmaceutical Industry (Silica Gel for Liquid Chromatography), the demand for use in
hyperlipidemia drugs expanded in Japan and South Korea. In Column and Equipment for Liquid
Chromatography, column sales to South Korea and China were favorable.
Active Pharmaceutical Ingredients (API) and their Intermediates, net sales expanded due to increased
domestic sales of intermediates for anti-infective drugs, intermediates for anti-tuberculosis drugs, raw materials
for biopharmaceuticals, and increased overseas sales of intermediates for vasodilators. In addition, the importsales of generic drug substances increased.
In Liquid Crystal Display (LCD) related products such as color resist, net sales declined due to volume
decrease in LCD panels. In glass fiber, net sales declined due to volume decrease in domestic market forelectronic materials.
As a result, Functional Chemical Products reported net sales of ¥31,245 million, down 3.2% compared to thesame period of fiscal 2018.
Housing Facilities and Others
Net sales were ¥12,579 million, down 0.8% compared to the same period of fiscal 2018. Sales of life materials
grew steadily, but sales of construction materials declined.

4(2) Financial Condition
AssetsCurrent assets were ¥70,233 million, an increase of 3.0% since March 31, 2019. The increase was due
primarily to an increase of ¥1,800 million in short term investment securities, an increase of ¥1,487 inelectronically recorded monetary claims, an increase of ¥1,238 million in inventories, a decrease of ¥1,477
million in notes and accounts receivable-trade, and a decrease of ¥1,258 in cash and deposits.
Noncurrent assets were ¥44,338 million, a decrease of 0.2% since March 31, 2019. The decrease was due
primarily to a decrease of ¥205 million in intangible assets, a decrease of ¥96 million in deferred tax assets, adecrease of ¥84 million in property, plant and equipment, and an increase of ¥327 million in investment
securities.
As a result, Total assets were ¥114,572 million as of December 31, 2019, an increase of 1.7% since March31, 2019.
LiabilitiesCurrent liabilities were ¥28,790 million, a decrease of 10.6% since March 31, 2019. The decrease was due
primarily to a decrease of ¥1,847 million in income taxes payable and a decrease of ¥1,464 million in current
portion of bonds with share acquisition rights respectively.
Noncurrent liabilities were ¥15,924 million, a decrease of 0.1% since March 31, 2019. The decrease wasdue primarily to a decrease of ¥483 million in deferred tax liabilities and a decrease of ¥391 million in provision
for retirement benefits for directors.
As a result, Total liabilities were ¥44,714 million as of December 31, 2019, a decrease of 7.1% since March31, 2019.
Net assets
Net assets were ¥69,858 million as of December 31, 2019, an increase of 8.2% since March 31, 2019.
(3) Earnings Forecast
There are no revisions to the earnings forecast from the previous forecast announced in the "Consolidated
financial results for the quarterly period ended March 31, 2020, unaudited" on May 10, 2019.

5

5.

CONSOLIDATED FINANCIAL STATEMENTSCONSOLIDATED BALANCE SHEETS(Millions of yen)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade
Electrically recorded monetary claims
Short term investment securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Other current assets
Less: Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant, and equipment
Machinery, equipment, and vehicles - Net
Other - Net
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Deferred tax assets
OtherLess: Allowance for doubtful accounts
Total investment and other assets
Total noncurrent assets
Total assets

6

March 31,2019

December 31,201911,87629,2683,508
12,499
7,050
1,643
1,827
685
(140)
68,21910,61827,791
4,995
14,299
7,339
2,026
2,393
910
(141)
70,233

10,442
11,52021,962

9,153
12,724
21,878

864
474
1,338

726
406
1,133

19,642
442
1,062
(6)
21,14144,442
112,661

19,969
346
1,017
(6)
21,32644,338
114,572

CONSOLIDATED BALANCE SHEETS (Continued)(Millions of yen)

Liabilities
Current liabilities
Notes and accounts payable- trade
Short term loans payable
Income taxes payable
Provision for bonuses
Current portion of bonds with subscription rights to shares

Other current liabilities
Total current liabilities
Noncurrent liabilities
Bonds with subscription rights to shares
Deferred tax liabilities
Provision for directors retirement benefits
Net defined benefit liability
Other noncurrent liabilities
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Unrealized gain on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Re-measurements of defined benefit plans
Total accumulated other comprehensive income
Total net assets
Total net assets and liabilities

7March 31,
2019

December 31,
2019

15,586
7,767
2,280
889
1,464
4,211
32,197

15,219
7,767
433
455
4,914
28,79010,000
1,094
651
3,009
1,160
15,915
48,113

10,000
1,577
260
2,982
1,103
15,92444,71415,15013,66736,942(6,679)59,08015,87014,38740,307(6,682)
63,8845,781
1
11(327)
5,467
64,548112,661

6,281
9(15)
(301)
5,974
69,858
114,572

CONSOLIDATED STATEMENTS OF INCOME(Millions of yen)

Nine Months Ended
December 31,
December 31,
2018
2019
81,85079,99864,14562,916
17,70417,082

Net sales
Cost of sales
Gross profit
Selling, general, and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Share of profit of entities accounted for using equity
methodForeign exchange income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Other
Total non-operating expenses
Ordinary income

10,053
7,650

9,662
7,419

19389
299418
28

234
87760

145
601

7976
155
8,255

71
48
22142
7,879

139
139

0178
179

Extraordinary income
Gain on sales of noncurrent assets
Other
Total extraordinary income
Extraordinary loss
Loss on retirement of noncurrent assets
Loss on valuation of investment securities
Loss on valuation of shares of subsidiaries andassociates
Other
Total extraordinary loss
Income before income taxes

288-216354
252

288
8,106

3827
7,231

Income taxes - current
Income taxes - deferred
Total income taxes
Net income
Net income attributable to non-controlling interests
Net income attributable to owners of parent

2,492
(4)
2,487
5,618
5,618

1,946
340
2,286
4,944
4,944

8

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME(Millions of yen)

Nine Months Ended
December 31,
December 31,
2018
2019
5,618
4,944

Net income
Other comprehensive income
Unrealized gain on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustments
Re-measurements of defined benefit plans
Share of other comprehensive income of entities accounted(2,528)39(11)
24(0)

500
7(27)
260(2,476)
3,141

507
5,451

3,141－

5,451－

for using equity method

Total
Comprehensive income
Comprehensive income attributable to:
Owners of parent
Non-controlling interests

6. Notes to the Consolidated Financial Statements(1) Going concern assumption: None
(2) Significant changes in the amount of shareholders’ equity: None
(3) Segment Information
Nine months ended December 31, 2018

Basic Chemical ProductsFunctional Chemical Products
Housing Facilities and Others
Subtotal
Adjustments *1
TotalNotes 1:(Millions of yen)
Net salesIntersegment sales
or reclassifications
1750
413
481
(481)
－

Externalsales
36,89332,27812,67881,850－81,850Total
36,91132,32913,091
82,331(481)
81,850

Segment
income *2
4,257
4,065
239
8,561
(911)
7,650

Adjustments of segment income of ¥(911) million are corporate expenses not allocated toreportable segments. Corporate expenses are mainly expenses not attributable to a reporting
segment and related to fundamental research and development as well as administrativedepartments.

Notes 2:

Segment Income is reconciled with consolidated operating income.

9Nine months ended December 31, 2019

Basic Chemical Products
Functional Chemical Products
Housing Facilities and Others
Subtotal
Adjustments *1
Total
Notes 1:

(Millions of yen)
Net salesIntersegment sales
or reclassifications
1467
606
689
(689)
－

External
sales
36,17331,245
12,57979,998－79,998

Total
36,18731,313
13,18680,687(689)
79,998Segment
income *2
3,709
4,233
358
8,301(881)
7,419

Adjustments of segment income of ¥(881) million are corporate expenses not allocated toreportable segments. Corporate expenses are mainly expenses not attributable to a reporting
segment and related to fundamental research and development as well as administrativedepartments.

Notes 2:

Segment Income is reconciled with consolidated operating income.

10