(Reference Translation)
February 8, 2022

Osaka Soda Co., Ltd.
CONSOLIDATED FINANCIAL RESULTS
For the Third Quarter of the Fiscal Year ending March 31, 2022
(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:

Toru Imamura, General Manager, Administration Division(Telephone: +81-6-6110-1560)

Filing date for quarterly report:

February 9, 2022

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, 2021

December 31, 2020

Millions of yen

Change *Millions of yen

Change *Net sales

65,320-%72,327(9.6) %

Operating income

9,840

56.6%

6,284

(15.3) %Ordinary income

10,627

63.5%

6,500

(17.5) %Net income attributable to owners of parent

7,550

73.4%

4,355

(11.9) %Comprehensive income

6,144(16.1) %7,320

34.3 %

Note:

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

Net income per share (Yen)323.65184.81

Diluted net income per share (Yen)

290.71165.04

Note: Osaka Soda Group has adopted “Accounting Standard for Revenue Recognition” (ASBJ Statement No.29) fromthe beginning of quarterly period ended June 30, 2021. The figures for the nine months ended December 31,
2021 reflect this change of accounting standard and year-on-year percent changes for nine months are notavailable.

(2) Financial Condition
December 31, 2021

March 31, 2021

Millions of yen

Ratio

Millions of yen

Ratio

Total assets

128,088－

119,373－

Net assets

81,830－77,232－Equity attributable to owners of the parent*

81,807－

77,224

－

－

63.9%

－

64.7%

Equity ratio
Note:

Equity = “Total net assets” minus “Non-controlling interests”

12. Dividends
Year ending Mar. 31, 2022

Year ending Mar. 31, 2022

Year ended Mar. 31, 2021－－

35.00 yen*32.50 yen－－

(Forecast)End of first quarterEnd of second quarterEnd of third quarterEnd of fourth quarter

35.0 yen－32.50 yen

Full year

70.0 yen－

65.00 yen

Note:

Changes from the most recently published forecast of dividends: None

3. Earnings Forecast for the fiscal year ending March 31, 2022
Full-year
Millions of yen

Change*Net sales

82,000-%Operating income

10,70028.3%

Ordinary income

11,40029.0%

Net income attributable to owners of parent

8,000

32.2%

Note: Revisions of earnings forecast from the latest announcement: None

Earnings per share (Yen)342.95Note 1: Changes from the most recently published forecast of financial results: None
Note 2: Osaka Soda Group has adopted “Accounting Standard for Revenue Recognition” (ASBJ Statement No.29) fromthe beginning of fiscal year ending March 31, 2022. The earnings forecast for the fiscal year ending March 31,
2022 reflect this change of accounting standard and year-on-year percent changes are not available.

* 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 prior period financial
statements
1) Changes in accounting policies due to revisions of accounting standards, etc.: Yes
2) Changes in accounting policies other than 1: None
3) Changes in accounting estimates: None
4) Restatement of prior period financial statements: 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, 2021:

26,732,017

shares

As of March 31, 2021:

26,731,415

shares22) Number of treasury shares at the end of the period
As of December 31, 2021:

3,400,107

shares

As of March 31, 2021:

3,404,604

shares3) Average number of shares outstanding during the period
Nine months ended December 31, 2021:

23,329,382

sharesNine months ended December 31, 2020:

23,565,292

shares* 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 future
results.

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 2021 (April 1 through December 31, 2021), the Japanese economy is showing
signs of picking up although it has remained in a severe situation due to the novel coronavirus (COVID-19)
pandemic. The economy is expected to continue its recovery trend. However, the economic outlook remains
uncertain because of a new variant of the coronavirus and supply-side constraints, and the downside risks
such as raw material price fluctuations.
Under the circumstances, Osaka Soda Group launched the Medium-Term Management Plan “Empower the
Next - 22”, and implemented concrete measures based on four basic policies, “Building a resilient businessfoundation”, “Promotion of market-in-type development”, “Efforts to achieve the SDGs”, and “Reforming
corporate culture and organizational culture”.
With regard to ”Building a resilient business foundation”, the following business domains such as Chemicals
business, Functional Materials business , and Healthcare business are positioned as core businesses andresilient strategy is pursued. In Chemicals business, we have established a stable supply system as originallyplanned, with the commencement of operations at our Kitakyushu Plant, which was formed as a result of theintegration of electrolysis facilities at the Fukuoka Plant of Mitsubishi Chemical Corporation and our Kokura
Plant. Functional Materials business responded to growing global demand in Allyl Ethers with expansion of the
supply system and improvement of productivity. Health Care business continued to grow at a strong pace dueto the increase of customer acceptance for new grades in Chromatography and to the increase of new orders
for Pharmaceutical API and Intermediates. Pursuing cost reduction at production sites is connected tocontribution to earnings constantly.
With regard to “Promotion of market-in-type development”, we succeeded in developing a semi-solid battery
using our special polyether in collaboration with Yamagata University. In the future, we will build a supply
system for special polyether to begin mass production of semi-solid batteries.
As a result, net sales were ¥65,320 million, a decrease of 9.7% compared to the same period of fiscal 2020.
Net sales declined 18,708 million yen caused by the adoption of revenue recognition standard, but the reality
is that net sales increased. Operating income was ¥9,840 million, an increase of 56.6% compared to the same
period of fiscal 2020. Ordinary income was ¥10,627 million, an increase of 63.5% compared to the same periodof fiscal 2020. Net income attributable to owners of the parent was ¥7,550 million, an increase of 73.4%
compared to the same period of fiscal 2020. All incomes during the nine months ended December 31, 2021
reached record highs.
The following is a summary of reporting segments.
Basic Chemical Products
In Chlor-Alkali, net sales increased, especially in caustic soda, due to the demand recovery out of coronavirus
collapse.
In Epichlorohydrin, net sales increased due to the demand recovery mainly in electrical materials. Overseas
market conditions remained high against the background of tight supply-demand balance.
As a result, Basic Chemical Products reported net sales of ¥27,514 million, down 11.4% compared to the same
period of fiscal 2020, due to the adoption of Accounting Standard for Revenue Recognition.
Functional Chemical Products
In Synthetic Rubber related products, Epichlorohydrin Rubber, net sales increased due to the increase inglobal demand for automobiles and office automation. Acrylic Rubber, net sales increased due to an

4expansion of customer acceptance in domestic and overseas, especially in Asian market.
In Diallyl Phthalate Resin, net sales increased due to the growth of electric materials caused by domestic
demand and the constant growth in exported sales to Asian countries including China and the United States.
In Allyl Ethers, net sales increased due to sales expansion of silane coupling agents in domestic and overseas.
In Separation Media in Pharmaceutical Industry (Silica Gel for Liquid Chromatography), net sales increased
due to demand expansion for diabetes drug use to Europe, the United States and Asian countries.
In Active Pharmaceutical Ingredients (API) and their Intermediates, net sales increased due to sales
expansion of anti-tuberculosis drug intermediate, insomnia treatment intermediates, and anti-cancer drug
substance and intermediate,As a result, Functional Chemical Products reported net sales of ¥33,538 million, up 10.2% compared to thesame period of fiscal 2020.
Housing Facilities and Others
Net sales were ¥4,266 million, down 60.6% compared to the same period of fiscal 2020, due to the adoptionof Accounting Standard for Revenue Recognition.
(2) Financial Condition
AssetsCurrent assets were ¥81,035 million, an increase of 9.7% since March 31, 2021. The increase was due
primarily to an increase of ¥2,580 million in cash and deposits and an increase of ¥2,346 million in notes andaccounts receivable-trade respectively.
Noncurrent assets were ¥47,052 million, an increase of 3.4% since March 31, 2021. The increase was due
primarily to an increase of ¥3,271 million in property, plant and equipment and a decrease of ¥1,547 million in
investments and other assets.
As a result, Total assets were ¥128,088 million as of December 31, 2021, an increase of 7.3% since March
31, 2021.
Liabilities
Current liabilities were ¥40,472 million, an increase of 50.9% since March 31, 2021. The decrease was due
primarily to an increase of ¥1,824 million in notes and accounts payable-trade and an increase of ¥8,735 million
in current portion of bonds with subscription rights to shares respectively.
Noncurrent liabilities were ¥5,785 million, a decrease of 62.2% since March 31, 2021. The decrease wasdue primarily to a decrease of ¥8,737 million in bonds with subscription rights to shares and a decrease of¥751 million in deferred tax liabilities respectively.
As a result, Total liabilities were ¥46,258 million as of December 31, 2021, an increase of 9.8% since March
31, 2021.
Net assets
Net assets were ¥81,830 million as of December 31, 2021, an increase of 6.0% since March 31, 2021.

(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 ending March 31, 2022, unaudited" on October 19, 2021. In the
future, we will appropriately disclose any changes that may have been made.

55. CONSOLIDATED FINANCIAL STATEMENTSCONSOLIDATED BALANCE SHEETS(Millions of yen)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade
Notes & accounts receivable-trade and contract assets
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
Other
Less: Allowance for doubtful accounts
Total investment and other assets
Total noncurrent assets
Total assets

6

March 31,2021

December 31,
2021

17,436
26,6553,456
14,499
6,581
1,661
2,219
1,435
(69)
73,87620,01729,001
4,370
14,499
7,017
2,267
2,422
1,508
(69)
81,035

8,920
11,616
20,536

11,688
12,11923,808

498
283
782

361
252
613

22,965325893(6)24,17845,496
119,373

21,537307792(5)22,63147,052
128,088

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
Net defined benefit liability
Other noncurrent liabilities
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders’ equity
Share capital
Legal capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference 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
Non-controlling interests
Total net assets
Total net assets and liabilities

7

March 31,2021

December 31,
2021

13,046
7,172
1,492
884
4,223
26,81814,870
7,172
2,108
477
8,735
7,109
40,472

8,737
2,463
2,705
1,415
15,322
42,141

1,712
2,712
1,360
5,785
46,25815,87014,38846,387(7,669)68,977

15,871
14,39052,363(7,659)74,966

8,292
48
(13)
(80)
8,247
7
77,232
119,373

6,788
12
113
(73)
6,841
22
81,830128,088

CONSOLIDATED STATEMENTS OF INCOME(Millions of yen)

Nine Months Ended
December 31,
December 31,
2020
2021
72,32765,32056,78545,467
15,542
19,852

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 gains
Insurance claim income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Share of loss of entities accounted for using equity
methodForeign exchange losses
Other
Total non-operating expenses
Ordinary income

9,257
6,284

10,012
9,840

12
437
-

7
459
38

82
532

145
151
78
881

68
111

66
-

126
10
316
6,500

26
93
10,627Extraordinary income
Gain on sales of noncurrent assets
Total extraordinary income
Extraordinary loss
Loss on retirement of noncurrent assets
Total extraordinary loss
Income before income taxes

-

309
309

112
112
6,388

92
92
10,844

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

1,701
331
2,033
4,354
(0)
4,355

3,343
(48)
3,294
7,550
(0)
7,550

8

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME(Millions of yen)

Net income
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustments
Re-measurements of defined benefit plans

Nine Months Ended
December 31,
December 31,
2020
2021
4,354
7,550

Share of other comprehensive income of entities accounted

2,983
(19)
(28)
29
0

(1,503)
(35)
113
6
14

2,965
7,320

(1,405)
6,144

7,320
(0)

6,144
0

for using equity method

Total
Comprehensive income
Comprehensive income attributable to:
Owners of the 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) Changes in accounting policies(Adoption of the Accounting Standard for Revenue Recognition)
Osaka Soda Group has adopted “Accounting Standard for Revenue Recognition” (ASBJ Statement
No.29, issued on March 31, 2020) and related implementation guidance (ASBJ guidance No.30, issued
on March 26, 2021) from the beginning of the fiscal year ending March 31, 2022, and recognize
revenue at the amount expected to be received in exchange for its goods or services when thedominance of the promised goods or services is transferred to customers. Among contracts applying
the completed-contract method, those with performance requirements met over a period of time willchange to a recognition method which estimates the degree of progression said performance fulfillment
and determines revenue based on this progression, except for those for which this period of time isextremely short. In addition, estimating the degree of progress on fulfillment of performancerequirements will use an input method based on the ratio of cost accrued to total estimated cost.
Regarding the revenue in which we act as an agent in providing the products or services to customers,
we have previously recognized the gross amount of consideration to be received from customers asrevenue. We have now changed to a method to recognize revenue at the net amount after deducting
the amount to be paid to suppliers from the amount to be received from customers.
Regarding to the adoption of the revenue recognition standards, in accordance with the transitional
treatment stipulated in the provision to paragraph 84 of the Accounting Standard for Revenue
Recognition, the cumulative effect of retroactively adopting the new accounting policy prior to thebeginning of the fiscal year ending March 31, 2022, has been added to or deducted from retained9earnings at the beginning of the fiscal year ending March 31, 2022 and the new accounting policy has
been adopted from the beginning balance of the fiscal year ending March 31, 2022.
As a result, net sales and cost of sales decreased 12,266 million yen respectively for the quarterly
period ended June 30, 2021. Nothing has changed in operating income, ordinary income, net income
before income taxes.
Due to the application of these accounting standards, “Notes and accounts receivable-trade” in“Current Assets” in the consolidated balance sheets have been reclassified as “Notes and accounts
receivable-trade, and contract assets” from the second quarter of the fiscal year ending March 31,
2022.
Based on the transitional treatment stipulated in Article 89-2 of the “Accounting Standard for Revenue
Recognition” comparative information for the previous fiscal year has not been restated to reflect the
new method of presentation. In accordance with the transitional treatment provided for in Paragraph 2815 of the “Accounting Standard for Quarterly Financial Reporting” (ASBJ Statement No.12, March 31,2020), information on disaggregate revenue from contracts with customers for the nine months ended
December 31, 2022 is not presented(Application of Accounting Standard for Fair Value Measurement)
Osaka Soda Group has adopted “Accounting Standard for Fair Value Measurement” (ASBJ Statement
No.30, issued on July 4, 2019) and related implementation guidance from the beginning of the quarterly
period ended June 30, 2021. Based on the transitional treatment prescribed in Paragraph 19 of the
Accounting Standard for Fair Value Measurement and Paragraph 44-2 of the “Accounting Standard for
Financial Instruments” (ASBJ Statement No.10, issued on July 4, 2019), we have decided to apply the
new accounting policies set forth by the Accounting Standard for Fair Value Measurement into the
future. These changes had no impact on the quarterly consolidated financial statements.
(3) Segment Information
Nine months ended December 31, 2020

(Millions of yen)
Net sales

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

External
sales
31,06430,446
10,81672,32772,327

Intersegment sales
or reclassifications
17
102
210
330
(330)
-

Total
31,08130,54811,02772,658(330)
72,327

Segment
income *2
2,709
4,241
269
7,220
(936)
6,284

Adjustments of segment income of ¥(936) 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 administrative
departments.

Notes 2:

Segment Income is reconciled with consolidated operating income.

10

Nine months ended December 31, 2021

(Millions of yen)

Basic

Functional

Housing

ChemicalChemicalFacilities

Consolidated

Products

Products

and Others

Total

Adjustments *1

operatingincome *2

Net salesJapan

22,455

16,072

4,241

42,769-42,769

Asia

3,668

12,14625

15,840-15,840Europe

560

4,196

-

4,757

-

4,757

Others

830

1,123

-

1,953

-

1,953

27,51433,5384,266

65,320-65,320

Other revenue

-

-

-

-

-

-

External sales

27,51433,5384,266

65,320-65,320

71

500

1,870

2,443

(2,443)-27,58634,0396,137

67,764(2,443)65,320

3,791

6,574

354

10,720

(880)

9,840

Revenue fromcontracts withcustomers

Intersegment sales
or reclassifications
Total
Segment income

Notes 1:

Adjustments of segment income of ¥(880) 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 administrative
departments.

Notes 2:

Segment income has been adjusted for the operating income appearing in the quarterly
consolidated statements of income.

11