Consolidated Financial Results for the Year Ended March 31, 2016
Mitsubishi Materials Corporation
Tokyo, JapanMay 12, 2016
Stock code:
Shares listed:
URL:
Representative:
For further information please contact:

5711
Tokyo Stock Exchange
http://www.mmc.co.jp/
Mr. Akira Takeuchi, President
Mr. Naoya Sasaki, Manager, Corporate Communications & IR Dept.
Tel: +81-3-5252-5206
June 29, 2016
June 1, 2016
June 29, 2016
Yes
Yes (For Corporate Investors)

Scheduled date of Ordinary General Meeting of Shareholders:
Scheduled date of start of dividend payment:
Scheduled date of filing of financial statements:
Supplementary materials for financial results:
Investor conference for financial results:

1. Results of the year ended March 31, 2016 (From April 1, 2015 to March 31, 2016)(1) Results of operations:

Net sales-6.5 (%)(Millions of yen)
(Percentage changes relative to previous corresponding period)
Net income
Operating profit
Ordinary income
attributable toowners of the parent¥70,420 -2.0 (%) ¥72,442 -10.7 (%) ¥61,316
9.2 (%)

Year ended Mar. 31, 2016

¥1,417,895

Year ended Mar. 31, 2015
(Note) Comprehensive income¥1,517,265
7.2 (%) ¥71,871
8.4 (%) ¥81,093
5.5 (%)
Year ended Mar. 31, 2016:
19,664 million yen (-83.7%)
Year ended Mar. 31, 2015:
120,954 million yen (43.0%)¥56,147

6.8 (%)(Yen)
Net income
per share

Diluted net
income per share

Year ended Mar. 31, 2016¥46.80Year ended Mar. 31, 2015¥42.85(Reference) Equity losses and earnings of affiliates

Net income/shareholders’ equity

11.1 (%)
11.1 (%)
Year ended Mar. 31, 2016:
Year ended Mar. 31, 2015:

Ordinary income/total assets

3.9 (%)
4.4 (%)
2,188 million yen
6,557 million yen

Operatingprofit/net sales
5.0 (%)
4.7 (%)(2) Financial position:

As of Mar. 31, 2016
As of Mar. 31, 2015
(Reference) Shareholders’ equity

Shareholders’ equity
ratio(Millions of yen)
Shareholders’ equity
per share

Total assets

Net assets¥1,793,375¥645,017

31.0 (%)¥423.83¥1,898,157
As of Mar. 31, 2016:
As of Mar. 31, 2015:¥629,514
555,227 million yen
550,762 million yen

29.0 (%)¥420.36(3) Cash flows:
Cash flows fromoperating activities

Cash flows frominvesting activities

Year ended Mar. 31, 2016

¥118,685¥(29,982)¥(120,477)(Millions of yen)
Cash and cash
equivalents at endof year¥58,482

Year ended Mar. 31, 2015

¥108,070¥(42,366)¥(42,273)¥92,079

Cash flows fromfinancing activities

2. Dividend payments(Yen)
Dividends per share
First

SecondThird

quarterquarterquarterYear ended
Mar. 31, 2015
Year ended
Mar. 31, 2016

Year-end

AnnualTotal dividends(Annual)Dividend ratio(Consolidated)

Dividends/
net assets(Consolidated)

-

¥3.00

-

¥5.00

¥8.00

¥10,482million

18.7 (%)

2.1 (%)

-

¥5.00

-

¥5.00

¥10.00¥13,100million

21.4 (%)

2.4 (%)

-

¥2.00

-

¥4.00

¥6.00

Year ending
Mar. 31, 201731.4 (%)(Forecast)

3. Forecast (From April 1, 2016 to March 31, 2017) 	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  	
  (Millions of yen)

Net sales

Operatingprofit¥645,000 -9.1(%)¥29,000 -19.9(%)¥25,000 -35.9(%)¥24,000 -47.6(%)¥18.32 (yen)¥1,360,000 -4.1(%)¥68,000 -3.4(%)¥68,000 -6.1(%)¥25,000 -59.2(%)¥19.08 (yen)Six months ending
September 30, 2016
Year ending March 31,
2017(Percentage changes relative to previous corresponding period)
Net income
attributable to
Net income per
Ordinary income
owners of theShareparentNotes:(1) Significant changes of subsidiaries during the period (including changes in scope of consolidation): None
(2) Changes in accounting policies; changes in accounting estimates; restatements(i) Changes in accounting policies due to amendment of accounting standards: Yes(ii) Other changes in accounting policies: None(iii) Changes in accounting estimates: None(iv) Restatements: None
(3) Number of issued shares (common stock)(i) Number of issued shares at end of year (including treasury shares)
Year ended March 31, 2016:
1,314,895,351 sharesYear ended March 31, 2015:
1,314,895,351 shares(ii) Number of treasury shares at end of year
Year ended March 31, 2016:
4,886,174 sharesYear ended March 31, 2015:
4,677,305 shares(iii) Average number of shares during the period
Year ended March 31, 2016:
1,310,101,981 sharesYear ended March 31, 2015:
1,310,342,256 shares(Reference) Summary of nonconsolidated financial results
Nonconsolidated results of operations of the year ended March 31, 2016 (From April 1, 2015 to March 31, 2016)(1) Nonconsolidated results of operations:(Millions of yen)
(Percentage changes relative to previous corresponding period)
Net sales

Operating profit

Ordinary income

Net income

Year ended Mar. 31, 2016

735,501-9.3 (%)

26,478

11.7 (%)

35,409-0.8 (%)

33,001-0.6 (%)

Year ended Mar. 31, 2015

810,505

10.2 (%)

23,7082.3 (%)

35,699-15.3 (%)

33,193-21.7 (%)

Year ended Mar. 31, 2016
Year ended Mar. 31, 2015

Net Income per share

Diluted net income per share

25.19 (yen)25.33 (yen)-(2) Nonconsolidated financial position:(Millions of yen)

As of Mar. 31, 2016
As of Mar. 31, 2015
(Reference) Shareholders’ equity

Shareholders’ equity
ratio

Shareholders’ equity
per share

Total assets

Net assets

1,158,968

435,09437.5 (%)

332.13 (yen)432,265
435,094 million yen
432,265 million yen

34.5 (%)

329.91 (yen)1,252,174
As of Mar. 31, 2016:
As of Mar. 31, 2015:

Indication regarding the situation of audit procedures
As of the disclosure of these financial results, audit procedures of the financial statements pursuant to the Financial
Instruments and Exchange Act are in progress.
Appropriate use of business forecasts and other special items(Notes regarding descriptions of earnings forecasts and other forward-looking statements, etc.)
Earnings forecasts and other forward-looking statements in this document are based on information currently
available to the Company’s management and certain assumptions judged rational, and we do not promise that theforecasts in this report will be achieved. Accordingly, there might be cases in which actual results materially differ
from forecasts of this report. To use assumptions for forecasts, see (3) Outlook for the Year Ending March 31, 2017
(page 4) under “1. Analysis of Business Results and Financial Position (1) Analysis of Business Results”.
(Method of obtaining supplementary information to and contents of the financial results briefing)
Mitsubishi Materials Corporation is scheduled to hold financial results briefing for institutional investors on May 13,
2016 (Friday). Supplementary information to the financial results to be used in this briefing is being released on
TDnet and on the Company’s website with the announcement of the consolidated financial results for the year ended
March 31, 2016.

Contents

1. Analysis of Business Results and Financial Position ..............................................................................................2(1) Analysis of Business Results .............................................................................................................................2(2) Analysis of Financial Position ...........................................................................................................................4(3) Basic Profit Distribution Policies and Dividend Payments ...............................................................................5(4) Business and Other Risks ..................................................................................................................................6
2. Management Policies ..............................................................................................................................................8(1) Basic Group Management Policies....................................................................................................................8(2) Target Management Indicator, Medium- and Long-Term Management Strategies and Issues to Be
Addressed ................................................................................................................................................................8
3. Basic Perspective on Selection of Accounting Standards .....................................................................................11
4. Consolidated Financial Statement .........................................................................................................................12(1) Consolidated Balance Sheets ...........................................................................................................................12(2) Consolidated Statement of Operations and Consolidated Statement of Comprehensive Income ...................14
Consolidated Statement of Operations ..............................................................................................................14
Consolidated Statement of Comprehensive Income .........................................................................................15(3) Statement of Changes in Consolidated Shareholders’ Equity .........................................................................16(4) Consolidated Statements of Cash Flows .........................................................................................................19(5) Segment Information .......................................................................................................................................21(6) Per-Share Information .....................................................................................................................................26(7) Important Subsequent Events: .........................................................................................................................26

1

1. Analysis of Business Results and Financial Position(1) Analysis of Business Results
1) Results for the Year Ended March 31, 2016
During the fiscal year ended March 31, 2016, activity in China and other emerging markets showed signs of
weakness, besides other countries, including the United States, looked slowdown of economic growth.
The Japanese economy also showed signs of slowdown from the latter half of the fiscal year, due to sluggish
of individual consumption and production, although continued to improve employment and income conditions.
Looking at the Mitsubishi Materials Group’s operating environment, although foreign exchange markets
were generally characterized by year-on-year yen depreciation, the Group was affected by such factors as adecrease in copper and other key metal prices, as well as a fall in the overall demand for cement in Japan.
Furthermore, equipment trouble at a consolidated subsidiary prompted a temporary halt in operations, causing
earnings to decline.
Against this backdrop, the Group embarked on the medium-term management plan (FY2015–2017),“Materials Premium 2016—Challenge to become the world’s leading business group.” This plan defines thegroupwide growth strategies of “Fortifying the foundation for growth,” “Strengthening global competitiveness”
and “Pursuing a recycling-based business model.” The Group continued to implement a variety of measures
based on these strategies, such as the expansion of overseas bases—particularly in Asia, and underwent a processof business selection and focus, among other activities.
As a result, consolidated net sales for the fiscal year amounted to ¥1,417,895 million, down 6.5% from theprevious fiscal year. Operating profit decreased 2.0% to ¥70,420 million, and ordinary income decreased 10.7%
to ¥72,442 million. Net income attributable to owners of the parent increased 9.2% to ¥61,316 million, due inpart to the posting of extraordinary income in relation to the sale of some of the Group’s holdings of common
stock in SUMCO Corporation.
2) Overview of Segments(Cement)
Net sales
Operating profit
Ordinary income

FY 2015¥193.317.3¥16.7

FY 2016¥197.5
20.1¥19.7(Billions of yen)
Increase/decrease (%)¥4.1(2.2%)
2.7(15.8%)¥2.9(17.8%)In the domestic cement business, overall demand declined and sales volumes decreased. Although earthquake
reconstruction demand was firm in the Tohoku area, in other regions the business was affected by a decline inpublic works and labor shortages in the construction industry, which led to project delays. In the United States,with cement demand continuing on a recovery trend, sales volumes increased in Southern California, centeringon such private-sector categories as residential housing and commercial facility construction. Sales priceincreased and production costs were down year on year, as electricity and fuel costs fell throughout the year, and
the Group’s efforts to curtail repair costs were successful in reducing these expenses. In China, sales volumes
decreased substantially due to falling demand for real estate investment in Shandong. In the overall Cementbusiness, cement production amounted to 11.6 million tons, down 0.4 million tons from the previous fiscal year.
As a result, sales and operating profit increased for the segment. Ordinary income rose year on year, due tothe increase in operating profit.

(Metals)
Net sales
Operating profit
Ordinary income

FY 2015¥811.624.8¥32.8

FY 2016¥688.724.2¥27.0(Billions of yen)
Increase/decrease (%)¥(122.9)(-15.1%)(0.6)(-2.4%)¥(5.8)(-17.7%)In the copper business, net sales fell but operating profit rose. The business was affected by lower copper prices
and a decrease in sales of purchased items, as well as a temporary suspension of operations at PT. Smelting inIndonesia from mid-June to early September due to equipment trouble. However, operating costs fell andproduction in Japan increased, as the Naoshima Smelter & Refinery underwent no periodic furnace repairs during
the term. For the segment as a whole, copper cathode production amounted to 511 thousand tons, down 43
thousand tons from the previous fiscal year.
In the gold and other valuable metals business, net sales increased but operating profit fell due to higher ore
grades, which led to increased production, but the business was affected by lower palladium prices and other2

factors.
In the processed copper products, both net sales and operating profit decreased, because sales of products
for automobiles, semiconductors and others fell.
Consequently, the overall business recorded year-on-year decreases in net sales and operating profit.
Ordinary income for the overall segment was down from the preceding fiscal year, due to lower dividend income
and equity in earnings of affiliates.

(Advanced Materials & Tools)
Net sales
Operating profit
Ordinary income

FY 2015¥134.616.7¥16.5

FY 2016¥151.616.0¥14.9(Billions of yen)
Increase/decrease (%)¥17.0(12.6%)(0.7)(-4.2%)¥(1.6)(-9.7%)In the cemented carbide products business, demand was robust in Japan and overseas, particularly in Europe andthe United States. Against this backdrop, we conducted proactive sales promotions. These factors, in addition to
Mitsubishi Hitachi Tool Engineering, Ltd. (formerly Hitachi Tool Engineering, Ltd.) as a consolidated subsidiaryin April 2015, led to increases in net sales and operating profit.
In the high-performance alloy products business, although sales of products for the automobile sector
hovered at a steady level in North America, both net sales and operating profit decreased as sales volumes inJapan declined. Among other factors, Hitachi Metals MMC Superalloy, Ltd. (formerly MMC Superalloy
Corporation) transitioned to an equity-method affiliate of the Group from a consolidated subsidiary in July 2014.
Consequently, this segment recorded higher sales overall, while operating profit decreased. Ordinary
income fell year on year, owing to lower operating profit and a decrease in the foreign exchange gain.

(Electronic Materials & Components)
Net sales
Operating profit
Ordinary income

FY 2015
¥67.0
4.4
¥7.2

FY 2016
¥70.2
3.1
¥6.3

(Billions of yen)
Increase/decrease (%)¥3.2(4.8%)(1.2)(-28.8%)¥(0.9)(-12.8%)In the advanced materials and chemical products business, despite the steady progress in sales of semiconductor
manufacturing equipment-related products and products for automobile glass, sales of SoC products for
smartphones and products for hybrid automobiles decreased, causing both net sales and operating profit to fall.
In the electronic components business, sales of products for telecommunications equipment expanded.
However, costs rose due to investments in new products and sales of products for home appliances were down.
As a result, net sales were up but operating profit fell.
In the polycrystalline silicon business, operations were temporarily suspended at the Yokkaichi Plant fromearly January to late-June of 2014. In the year under review, however, the plant continued with normal operations,leading to an increase in sales. As a result, both net sales and operating profit rose.
Owing to the abovementioned factors, net sales rose for the segment, but operating profit decreased.
Ordinary income decreased due to a decline in operating profit.

3

(Aluminum)
Net sales
Operating profit
Ordinary income

FY 2015¥159.4
5.6¥5.1

FY 2016¥158.6
4.3¥3.6(Billions of yen)
Increase/decrease (%)¥(0.7)(-0.5%)(1.3)(-24.0%)¥(1.4)(-29.1%)In the aluminum cans business, demand increased for bottle cans and regular cans. Meanwhile, the cost of
materials increased.
In the rolled aluminum and processed aluminum products business, demand was down for products forautomobiles and products used in solar cells, while demand for products used in aluminum cans increased.
As a result, net sales and operating profit were down year on year for the aluminum business. Ordinary
income decreased year on year, due to the decrease in operating profit.

(Others)
Net sales
Operating profit
Ordinary income

FY 2015¥241.29.3¥9.8

FY 2016¥243.2
10.3¥9.9(Billions of yen)
Increase/decrease (%)¥2.0(0.8%)
0.9(10.5%)¥0.0(0.4%)In the energy-related business, while stagnant market conditions caused coal sales to fall, sales related to nuclear
power increased. Sales and income both rose as a result.
In the home appliances recycling business, net sales and operating profit were down, due to a reduction in
the handling volume owing to the lack of impact from last-minute demand after the increase in the consumption
tax rate and a decline in metal scrap prices.
Orders for nuclear energy and engineering services amounted to ¥60.7 billion, down ¥7.8 billion from theprevious fiscal year. The order backlog at the end of the period was ¥17.9 billion, down ¥11.3 billion from ayear earlier.

3) Outlook for the Year Ending March 31, 2017
Overall, the Group sees signs for concern in the global economy due to a downturn in China and other emerging
markets, despite the prospect of gradual economic recovery centered on Europe and the United States.
We believe the Japanese economy will continue its modest recovery, buoyed by improvements in
employment and income conditions, but recognize a downside risk due to overseas economic trends.
The Group expects its operating environment be affected by a backlash to yen appreciation in foreignexchange markets, as well as ongoing uncertainty about key metal prices.
Against this backdrop, the Group strive to grow by implementing the measures outlined in “2.
Management Policies.”
In this environment, for the fiscal year ending March 31, 2017, our consolidated operating performance
forecasts call for net sales of ¥1,360 billion, operating profit of ¥68.0 billion, ordinary income of ¥68.0 billion andnet income attributable to owners of the parent of ¥25.0 billion.
(2) Analysis of Financial Position
At March 31, 2016, total assets amounted to ¥1,793.3 billion, down ¥104.7 billion from a year earlier, mainly due
to a decline in investment securities.
Total liabilities decreased ¥120.2 billion, to ¥1,148.3 billion, primarily because of a decrease in short-termloans payable.
(Cash Flows from Operating Activities)
Net cash provided by operating activities amounted to ¥118.6 billion, up ¥10.6 billion from the previous fiscal
year. This rise was due mainly to decrease income before income taxes and inventories.
(Cash Flows from Investing Activities)
Net cash used in investing activities totaled ¥29.9 billion, down ¥12.3 billion from the previous fiscal year. This
cash was primarily used for outlays related to capital investments.
4

(Cash Flows from Financing Activities)
Together, operating activities and investing activities produced a net inflow of ¥88.7 billion, which was mainly
applied to the redemption of loans payable. Accordingly, net cash used in financing activities was ¥120.4 billion,up ¥78.2 billion from the previous fiscal year.
As a result of the above, as well as exchange rate changes and other factors, the balance of cash and cash
equivalents at March 31, 2015, stood at ¥58.4 billion, down ¥33.5 billion from March 31, 2015.
Below is a summary of major cash flow indicators.

Equity ratio (%)
Equity ratio on amarket-value basis (%)
Ratio of interest-bearing
debt to cash flow
Interest coverage ratio

March 31,
2012
20.0

March 31,
2013
22.4

March 31,
2014
25.7

March 31,
2015
29.0

March 31,
2016
31.0

19.6

19.4

21.6

27.9

23.2

8.0

7.1

6.5

6.0

4.6

8.3

9.0

10.2

12.9

16.5

Equity ratio:
Equity ratio on a market-value basis:
Ratio of interest-bearing debt to cash flow:
Interest coverage ratio:

Shareholders’ equity/Total assets
Total value of shares at market price/Total assets
Interest-bearing debt/Cash flow
Operating cash flow/Interest payments(Note 1) All indicators are calculated on a consolidated basis.
(Note 2) Market capitalization is based on the year-end share price multiplied by the number of shares issued andoutstanding at year-end (after deducting treasury stock).
(Note 3) Cash flow is based on the net cash provided by operating activities in the Consolidated Statements ofCash Flows.
(Note 4) Interest-bearing debt covers all interest-bearing debt in the Consolidated Balance Sheets. Interest
payments are based on the amounts shown in the Consolidated Statements of Cash Flows.

(3) Basic Profit Distribution Policies and Dividend Payments
Based on its Articles of Incorporation, the Company is to distribute surpluses following resolutions at Board of
Directors meetings. We regard the distribution of profits to all shareholders as one of our most important priorities.
Accordingly, our policy is to make decisions on profit appropriation based on comprehensive consideration ofvarious factors related to overall management, such as income over the relevant period, retained earnings, andfinancial position. Based on this policy, the Board of Directors, at its meeting on May 12, 2016, decided to
distribute a year-end dividend of ¥5 and an interim dividend of ¥5, resulting in a full-year dividend for the year
ended March 31, 2016, of ¥10 per share (up ¥2 from the preceding fiscal year).
Dividend payments for the year ending March 31, 2017 are expected to amount to ¥6 per share (¥2interim dividend plus ¥4 year-end dividend).

5(4) Business and Other Risks
Because the Group, as stated in “4. Consolidated Financial Statements (5). (Segment Information),” is engaged ina broad variety of business activities, its business results and financial standing are influenced by all kinds offactors, such as political affairs, economy, weather, market conditions, currency movements, and laws andordinances both in and outside the country. Listed below are the factors that may have a particularly substantial
impact on the Group.
Please note that although the matters listed in this section contain items related to the future, these items havebeen chosen as of May 12, 2016.
1) Corporate reorganization
The Group is always engaged in selection and concentration of its various businesses, actively investing
management resources in businesses with high profitability, at the same time actively conducting revisions,reorganizations, and restructuring of its businesses always ready to consider possibilities regarding collaboration
with other companies. The business results and financial standing of the Group may be influenced by this process.
2) Market and customer trends
The Group offers products and services to all kinds of industries, and due to such factors as changes of theconditions of the world economy, rapid changes in clients’ markets, changes in clients’ market share, and changes
in clients’ business strategies or product development trends may influence the sales of the products of the Group.
Especially the automobile industry and the IT-related industry are exposed to intense competition in the area of
prices and technical development, and while the Group takes every precaution endeavoring to reduce the costs anddevelop new products and technologies, in cases where we cannot appropriately respond to the changes inindustries and clients’ markets, the business results of the Group may be affected.
3) Rates for nonferrous metals, exchange fluctuation, etc.
In the Metals business, dividends from mines the Group made capital subscriptions into that are denominated inforeign currency, which are the main sources of profits, as well as smelting expenses, etc., are influenced by rates
for nonferrous metals, exchange fluctuations, and conditions of ore purchasing. Furthermore, in the area of
inventories, there is a risk of rates for nonferrous metals and exchange fluctuation influencing the material costs inthe period from the procurement of the ore to the production and sales of the metals.
Also, such items as nonferrous metals used as raw materials in the Aluminum business and the Advanced
Materials & Tools business as well as coal in the Cement business are international merchandise, and theacquisition cost of these raw materials and mineral fuel can be influenced by fluctuation of market prices,
exchange rates, ocean freight, etc. for nonferrous metals and coal.
4) Trends in the conditions of the semiconductor market
The Group supplies electronic materials, polycrystalline silicon, etc. for the semiconductor industry, and is also
engaged in the silicon wafer business for semiconductors in the SUMCO Corporation, which is an equity-method
affiliate, and business results and financial standing of the Group may be influenced by conditions of thesemiconductor market.
5) Interest-bearing debt
In the term ended March 31, 2016, the interest-bearing debt of the Group was ¥526.3 billion yen (which is thesum total of short-term loans payable, current portion of bonds payable, bonds payable, and long-term loans
payable; same below if there are no explanatory notes) amounting to 29.3% of the total assets. And although weare making efforts to improve the financial standing by reducing inventories, asset sales, etc., the future financial
situation may affect business results and financial standing of the Group.
6) Guaranty of liabilities
In the term ended March 31, 2016, the Group has undertaken a ¥26.3 billion yen guaranty of liabilities against
monetary liabilities of affiliated companies, which are not included in the scope of consolidation. In cases, wherea situation arises in the future, in which we are requested to fulfill these guaranties of liabilities, this may affectbusiness results and financial standing of the Group.
7) Fluctuations of the market value of assets
The business results and financial standing of the Group may be influenced by fluctuations in the market value of
securities, land, and other assets possessed.
68) Retirement benefit expenses and obligations
Employees’ retirement benefit expenses and obligations are calculated based on assumptions and conditions
mainly derived from mathematical calculations. In setting these assumptions and conditions, we take into
consideration employees’ average remaining length of service, long-term interest on the Japanese government
bonds, as well as the status of pension assets including shares contributed to trust funds, but losses caused bydeclines in the discount rate or operations with pension assets may affect the future expenses and obligations
posted by the Group.
9) Environmental regulations, etc.
In each business establishment in and outside the country, the Group makes efforts to control pollution, including
air pollution, wastewater pollution, soil pollution, and groundwater pollution, in accordance with environmental
laws and ordinances, and in dealing with abandoned mines within the country is endeavoring to control mine
pollution by, for example, preventing water pollution from mine water or conducting security management of thedumps in accordance with the Mine Safety Law. However, in cases where related laws are revised or permissible
greenhouse gas emission volume are limited, the Group may need to bear new expenses.
10) Overseas operations, etc.
The Group has production bases, sales bases, and other bases in 29 countries and regions abroad, and foreign sales
amount to 35.7% of its consolidated sales. Business results and financial standing of the Group may be influenced
by political/economic conditions, exchange rates at each country as well as changes of trading/commercial
regulations, mining policies, environmental regulations, systems of taxation, other unforeseen changes of laws or
regulations as well as differences of interpretation thereof, and changes of management policies of local
cooperators and partners.
11) Intellectual property rights
The Group fully recognizes the importance of intellectual property rights and makes efforts to protect them, but incases where the measures to protect the same are insufficient, or in cases where our rights are illegally infringed
on, this may affect the business results and financial standing of the Group. At the same time, although the Grouphandles the intellectual property rights held by other companies with the greatest possible care, in cases where it isestablished that we have infringed on the intellectual property rights held by other companies and have to pay
liabilities, such as compensation for damages, this also may affect the business results and financial standing of
the Group.
12) Quality of the products
The Group takes all possible measures regarding the quality control, striving to offer our clients products of highquality. However, in cases where due to some unforeseen circumstances we need to conduct a large-scale recall,this may affect the business results and financial standing of the Group.
13) Occupational health and safety, equipment accidents, etc.
The Group takes thoroughgoing measures to prevent occupational accidents and accidents to production
machinery. Our efforts span both intangible aspects such as management frameworks for occupational health,safety, security and accident prevention, and tangible approaches such as operational and maintenancemanagement and improving the safety of equipment. In the event of a major accident at work or an accident to theequipment occurs, this may affect business results and financial standing of the Group.
14) Management of information
The Group strives to ensure thoroughness in the management of information, including the handling of personal
information, but in cases where a leak of information or some other accident to information occurs, damage to our
reputation in society or other factors may affect the business results and financial standing of the Group.
15) Lawsuits, etc.
The business results and financial standing of the Group may be influenced by rulings, amicable settlements,
verdicts, etc. related to lawsuits, disputes, and other legal procedures, in which the Group is one of the parties
concerned at present, or will be one of the parties concerned in the future in relation to the business conducted by
the Group presently or in the past within the country and in foreign countries.
16) Procurement of electricity
The business results and financial standing of the Group may be influenced by increases in prices for electricity
resulting from such factors as cost increases of imported fossil fuels due to the suspension of operation of nuclear
7

power stations and increases in charges for renewable energy.
17) Other matters
In addition to the above, the business results and financial standing of the Group may be influenced by changes oftrade practices, terrorist attacks, wars, epidemics, earthquakes, flood and other natural disasters, and otherunexpected circumstances.

2. Management Policies(1) Basic Group Management Policies
In order to accelerate its corporate philosophy, “For People, Society and the Earth,” in a stable way, theGroup sets out the objective “to become the world’s leading business group committed to supporting
recycling-oriented society through materials innovation, with use of our unique and distinctive technologies,
by the early 2020s.”(2) Target Management Indicator, Medium- and Long-Term Management Strategies and Issues to Be
Addressed
Each operation of the Group commits to create valuable products and services with our distinctive
technologies and to occupy an important position in each industry and market, so that we can “Challenge to
become the world’s leading business group” defined in the above “(1) Basic Group Management Policies.”
In addition, for the purpose of focusing on fortifying the foundation to accomplish the above objective, wehave set the followings as the growth strategies for the overall Group in the “Materials Premium 2016–
Challenge to become the world’s leading business group.”
1) Fortifying the foundation for growth
Setting the motto “Safety and Health are First” as our first priority, we will enhance our safety management
systems and foster our corporate philosophy and culture to value safety so that we will secure stable
operational frameworks which contribute to the growth of the Group business.
In addition, the Group has earmarked a total of ¥100.0 billion to be used in strategic investment toaccelerate growth over a three-year period, with its focus on M&A activities and the expansion of overseas
production and sales bases. We are also working to improve profitability through an ongoing process ofbusiness selection and focus, which should continue to improve our financial structure.
2) Strengthening global competitivenessBy focusing on expanding our current production and sales locations in the overseas countries anddeveloping the new production and sales locations mainly in emerging countries, we will acquire new
business in growing global markets.
Furthermore, by conducting strategic marketing in the automobile and electronics industries, we will gain
access to new customers and markets so that we can boost our competitiveness.
3) Pursuing a recycling-based business model
The Group operates its business widely across the upstream (sources), midstream (materials) anddownstream (processed products) markets. In addition, we will pursue the business model to circulate wastes
to the upstream market for utilization.
Through the “Material Premium” plan, which derives from our unique strength as a conglomerate, wewill facilitate the recycling of waste that has so far been hard to process so that we can contribute to thesustainable growth of society.
The medium-term management plan mentioned above sets the following targets for the fiscal year ending
March 31, 2017: consolidated operating profit of ¥100 billion, consolidated ordinary income of ¥110 billion,
ROA of 6% and a net D/E ratio of 1.0 time or lower (assumed conditions: exchange rates of ¥100/USD and¥130/EUR and an LME copper price of 300¢/lb.
<Priorities in each business>● Cement
In the domestic cement business, the demand outlook is unclear. Nevertheless, shipments in relation to8

earthquake reconstruction are expected to be firm, and a number of large-scale projects are slated tocommence. These include projects related to the upcoming Olympic Games and construction of a linear
shinkansen (in some sections). As a result, fiscal 2016 domestic demand for cement is expected to remain at
the previous year’s level of approximately 43 million tons. Under these circumstances, we will work tosecure sales volumes by steadily implementing initiatives to benefit from demand related to large-scale
projects.
In the U.S. cement business, we anticipate continuing recovery trend with growing demand from theprivate sector. Against this backdrop, we will endeavor to bolster sales and profits by boosting sales volume
and engaging in further price revisions.
In the Chinese cement business, we see few signs that market conditions are improving. We will continue
with a host of initiatives aimed at increasing sales and profits, such as securing orders for new infrastructure
projects, ensuring appropriate pricing and curtailing production costs.
● Metals
We see the demand outlook for copper ore as unclear owing to the prospect of a slowdown in the Chinese
economy and other reasons.
Copper prices are low at present, mainly due to economic deceleration in China. We will continue tomonitor market trends, along with price trends in the foreign exchange and stock markets.
In processed copper products, we anticipate a gradual recovery in demand for automobile and otherproducts.
Under these conditions, we will continue working to lower our breakeven point in the metals business by
reducing energy costs and suppressing fixed expenses. Through these efforts, we aim to build a solid
constitution that is impervious to price fluctuations. In copper smelting, we will work toward stable
operations at smelters in Japan and overseas while expanding recycling operations by building a processing
structure that can manage difficult-to-handle waste and increasing E-Scrap processing volumes. Throughthese efforts, the Group expects to improve segment profits. In the processed copper products business, wewill continue to increase profitability by enhancing sales competitiveness through accelerated developmentof alloys, drawing on our technological and development capabilities.
● Advanced Materials & Tools
In the cemented carbide products business, we expect the deceleration of the Chinese economy to lead to adelayed recovery in the orders environment. That said, over the medium to long term we expect demand to
expand, particularly among our main customer base in the automobile and aircraft industries.
Under these circumstances, we will augment our sales bases and expand our sales network for cemented
carbide products, and further reinforce of high efficiency and high accuracy product development and ourtechnical service structure. Furthermore, we will continue working to stabilize our sourcing of tungsten—akey constituent of cemented carbide products—by improving the recycling ratio and through other efforts todiversify procurement sources.
Turning to the high-performance alloy products business, we expect demand for our mainstay sinteringparts to increase in line with growth in the automobile industry. The Group will work to increase earnings byaugmenting its overseas production locations in addition to enhancing productivity at production locations inJapan.
● Electronic Materials & Components
In the advanced materials business, the demand outlook for semiconductor-related products and products forsolar cells is opaque. We also expect a decrease in demand of parts for hybrid vehicles, but are working to
expand sales of products for non-automobile industries. Going forward, we aim to remain a step ahead ofcustomers’ needs in each of the markets in which we participate. We will strive to augment revenues andprofits by making full use of our core technological capabilities, and strengthening our sales competitivenessand our ability to make client proposals.
In the electronic components business, sales of products for home appliances are falling as Chinese
economic growth decelerates. In response, we are reinforcing our sales structure in emerging markets and,through new investments, working to increase sales of products for refrigerators, vehicles and industrial
equipment.
We will continue working to strengthen our business structure by introducing new products early andfurther reducing costs.
In polycrystalline silicon, we are endeavoring to establish a stable and efficient operating structure,
bolster quality and reduce costs, thereby creating a business structure that will enable us to ensure profits
even when demand levels are low.
9

● Aluminum
In the aluminum cans business, while working to increase our stability of orders for regular cans, we areworking to expand sales of bottle cans. We will make an effort to promote advantageous procurement of raw
materials, stable product quality and cost reductions.
In the rolled aluminum and processed aluminum products business, we will work to stabilize orders of
can materials and products for automobiles and electronic materials. We will also endeavor to expand salesof products for automobile in overseas, where demand is expected to rise.
Throughout this business, costs are highly susceptible to fluctuations in raw materials prices, so we aremounting a number of initiatives on this front.
We will actively promote the Group’s ongoing initiatives in the business of recycling used aluminum
cans.

10

3. Basic Perspective on Selection of Accounting Standards
We are currently researching and considering the International Financial Reporting Standards (IFRS),
working to understand their content and judge what impact their adoption would have on the Group. At thisstage, no date has been set for their adoption.

11

4. Consolidated Financial Statement(1) Consolidated Balance Sheets[March 31, 2015 and 2016](Millions of yen)
As of March 31, 2015

As of March 31, 2016

93,152230,874
85,100107,093
104,539
11,747100,169
137,855(2,129)60,123233,09385,082
83,69489,875
10,35289,360133,104(2,155)

868,403782,530

151,794
197,114273,589
17,476
15,060155,277
209,769
268,634
21,76914,786655,034

670,237

Intangible Assets:
Goodwill
Other
Total Intangible Assets

41,249
11,68652,93648,986
17,03266,019Investments and Other Assets:
Investment securities
Retirement benefit assets
Deferred income taxes
Other
Allowance for investment loss
Allowance for doubtful accounts

265,052242
30,11133,352(1,168)(5,807)

212,606
342
34,32433,385(6,070)321,783
1,029,753

274,5881,010,845

1,898,157

1,793,375

ASSETS
Current Assets:
Cash and deposits
Notes and accounts receivable-trade
Merchandise and finished goods
Work in process
Raw materials and supplies
Deferred income taxes
Gold bullion on loan
Other
Allowance for doubtful accounts
Total Current Assets
Noncurrent Assets:
Property, Plant and Equipment:
Building and structures, net
Machinery and equipment, net
Land, net
Construction in progress
Other, net
Total Property, Plant and Equipment

Total Investments and Other Assets
Total Noncurrent Assets
Total Assets

12

(Millions of yen)
As of March 31, 2015

As of March 31, 2016

Current Liabilities:
Notes and accounts payable-trade
Short-term loans payable
Current portion of bonds payable
Commercial papers
Income taxes payable
Deferred tax liabilities
Accrued bonuses
Gold payable
Allowance for loss on disposal of inventories
Other
Total Current Liabilities

128,375
252,197
20,040
5,000
9,545
275
12,362
227,505
844
121,670
777,817

110,596
200,527
25,1007,037
138
13,114
231,667626
107,511696,319

Noncurrent Liabilities:
Bonds payable
Long-term loans payable
Reserve for directors’ retirement benefits
Reserve for loss on subsidiaries and affiliates
Reserve for environmental measures
Deferred tax liabilities
Deferred tax liabilities for land revaluation
Net defined benefit liability
Other
Total Noncurrent Liabilities
Total Liabilities

65,100288,534
1,758
1,458
4,547
26,65928,44939,662
34,655490,825
1,268,643

40,000260,6811,628
1,760
13,35815,26526,53263,54429,267452,038
1,148,358

119,457
92,272
252,858(1,865)
462,723

119,457
92,266
303,026(1,953)
512,797

42,717(1,025)33,856
15,746(3,256)88,03978,751
629,514
1,898,157

21,645(199)
34,282
3,647(16,946)
42,43089,789645,017
1,793,375

LIABILITIESNET ASSETS
Shareholders’ Equity:
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total Shareholders’ Equity
Accumulated Other Comprehensive Income:
Valuation difference on securities available for sale
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total Accumulated Other Comprehensive Income
Non-Controlling Interests
Total Net Assets
Total Liabilities and Net Assets

13

(2) Consolidated Statement of Operations and Consolidated Statement of Comprehensive Income
Consolidated Statement of Operations[For the year ended March 31, 2015 and 2016](Millions of yen)

Net Sales
Cost of Sales
Gross Profit
Selling, General and Administrative Expenses
Operating Profit
Non-Operating Profit:
Interest income
Dividends income
Rent income on noncurrent assets
Equity in earnings of affiliates
Other
Total Non-Operating Profit
Non-Operating Expenses:
Interest expenses
Loss on disposal of property, plant and equipment
Expenses for rent in undertaking
Expenses for settlement of remaining business in mine
Other
Total Non-Operating Expenses
Ordinary Income
Extraordinary Income:Gain on sales of marketable securities and investments insecurities
Gain on changes in equity
Gain on sales of noncurrent assets
Insurance proceeds
Gain on redemption of investment securities
Gain on abolishment of retirement benefit plan
Other
Total Extraordinary Income
Extraordinary Losses:
Provision for environmental measures
Loss on business withdrawal
Loss on impairment
Loss on suspension of operations
Loss on valuation of investment securities
Other
Total Extraordinary Loss
Income before Income Taxes
Corporate Income Taxes and Business Tax
Income Tax Adjustments
Total Income Taxes
Net Income
Net Income Attributable to Non-Controlling Interests
Net Income Attributable to Owners of the Parent

14

Year Ended Mar. 31, 2015

Year Ended Mar. 31, 2016

(Apr. 1, 2014–Mar. 31, 2015)(Apr. 1, 2015–Mar. 31, 2016)

1,517,265
1,313,259
204,006
132,135
71,871

1,417,895
1,204,322
213,573
143,152
70,420607
15,293
4,966
6,557
3,884
31,309

589
9,019
5,005
2,188
4,895
21,699

8,233
3,183
3,234
3,589
3,845
22,086
81,093

6,694
3,366
3,174
2,865
3,576
19,67772,442

1,694

19,188

64
8,749
591
1,451
200
12,752

10,464
6,322
5,224
1,234
3,508
45,942

1,300
499
1,150
9,278
5,989
18,21775,62819,649(5,574)
14,07461,553
5,406
56,147

10,841
7,517
3,610
2,628
2,539
8,568
35,70582,68017,905(2,760)15,14467,536
6,219
61,316

Consolidated Statement of Comprehensive Income[For the Year Ended March 31, 2015 and 2016](Millions of yen)

Net Income
Other Comprehensive Income
Valuation difference on securities available for sale
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation adjustment
Adjustments for retirement benefits
Equity in earnings of affiliates
Total other comprehensive income
Comprehensive Income(Breakdown)Comprehensive income attributable to owners of theparent company
Comprehensive income attributable tonon-controlling interests

15

Year Ended Mar. 31, 2015

Year Ended Mar. 31, 2016

(Apr. 1, 2014–Mar. 31, 2015)(Apr. 1, 2015–Mar. 31, 2016)

61,55367,536

10,691(1,434)
2,801
33,215
11,7142,411
59,401
120,954(21,165)
1,044
1,490
(11,326)(14,369)(3,544)(47,872)
19,664

106,600

16,451

14,354

3,212

(3) Statement of Changes in Consolidated Shareholders’ Equity
Year Ended Mar. 31, 2015 (Apr. 1, 2014–Mar. 31, 2015)(Millions of yen)
Shareholders’ equity
Capital stock
Balance at beginning of period

Capital surplus

119,457

92,272

Cumulative impact of changes

Retained earnings

Treasury stock

Total
shareholders’equity207,354(1,782)

417,302(3,611)in accounting policies(3,611)

Balance at beginning of
period, reflecting changes in

119,457

92,272

203,742(1,782)

413,690accounting policies
Change during the year
Cash dividends from retained
earnings
Net income attributable toowners of the parent
Decrease from write-downsof land revaluation excess
Increase from rise in numberof consolidated subsidiaries
Decrease due to addition ofequity-method affiliates(9,172)(9,172)56,14756,147

1,861

1,861

327

327

(46)

(46)

Acquisition of treasury stock
Disposition of treasury stock

(0)

(84)

(84)

1

1

Net change in items otherthan shareholders’ equity
Total change during the year
Balance at end of period-(0)49,116(83)

49,033

119,457

92,272

252,858(1,865)

462,72316

Accumulated other comprehensive income
Valuationdifference
on securities
available forsale

Balance at beginning of period

31,972

Deferred
gains orlosses onhedges218

Revaluati
on reserve
for land

32,907

Foreigncurrencytranslation
adjustment(12,348)

Total
Remeasurements

Accumulatedof definedotherbenefit planscomprehensive

Non-Controlling
Interests

Total net
assetsincome(13,302)39,447

68,957

Cumulative impact of changes

525,707(3,611)in accounting policies
Balance at beginning of
period, reflecting changes in

31,972

218

32,907(12,348)(13,302)39,447

68,957522,095

accounting policies
Change during the year
Cash dividends from retained(9,172)

earnings
Net income attributable to56,147owners of the parent
Decrease from write-downs

1,861

of land revaluation excess
Increase from rise in number

327

of consolidated subsidiaries
Decrease due to addition of(46)

equity-method affiliates
Acquisition of treasury stock(84)

Disposition of treasury stock

1

Net change in items otherthan shareholders’ equity
Total change during the year
Balance at end of period

10,745(1,244)949

28,095

10,046

48,591

9,793

58,385

10,745(1,244)949

28,095

10,046

48,591

9,793

107,418

42,717(1,025)33,856

15,746(3,256)88,03978,751

629,514

17

Year Ended Mar. 31, 2016 (Apr. 1, 2015–Mar. 31, 2016)(Millions of yen)
Shareholders’ equity
Capital stock
Balance at beginning of period
Cumulative impact ofchanges in accounting
policies
Balance at beginning of period,
reflecting changes inaccounting policies
Change during the year
Cash dividends from retained
earnings
Net income attributable toowners of the parent
Decrease from write-downsof land revaluation excess
Increase from rise in numberof consolidated subsidiaries
Acquisition of treasury stock
Disposition of treasury stock
Changes in equity of theparent company related totransactions with
non-controlling shareholders
Net change in items otherthan shareholders’ equity
Total change during the year
Balance at end of period

Retainedearnings

Capital surplus

119,457

92,272

Total
shareholders’equity462,723

Treasury stock

252,858(1,865)805
119,457

92,272805

253,664(1,865)463,529(13,101)(13,101)

61,31661,316

843

843

304

304
(89)
1

(0)

(89)
1

(5)

119,457(5)(5)
92,26549,362
303,026(88)(1,953)49,268
512,797

Accumulated other comprehensive income
Valuationdifference
on securities
available forsale

Balance at beginning of period
Cumulative impact ofchanges in accounting
policies
Balance at beginning of period,
reflecting changes inaccounting policies
Change during the year
Cash dividends from retained
earnings
Net income attributable toowners of the parent
Decrease from write-downsof land revaluation excess
Increase from rise in numberof consolidated subsidiaries
Acquisition of treasury stock
Disposition of treasury stock
Changes in equity of theparent company related totransactions with
non-controlling shareholders
Net change in items otherthan shareholders’ equity
Total change during the year
Balance at end of period

42,717

Deferred
gains orlosses onhedges(1,025)

Revaluation
reserve forland

33,856

Foreigncurrencytranslation
adjustment

15,746

Remeasur

Total

ements of

Accumulated

definedotherbenefitcomprehensive

plansincome(3,256)88,039Non-Control
lingInterests

78,751

Total net
assets629,514805

42,717(1,025)33,856

15,746(3,256)88,03978,751

630,319(13,101)
61,316
843
304
(89)
1
(5)
(21,071)826

426(12,099)(13,690)(45,608)

11,038(34,570)(21,071)
21,645

826
(199)

426
34,282(12,099)
3,647(13,690)(16,946)(45,608)
42,43011,03889,78914,697645,01718

(4) Consolidated Statements of Cash Flows[For the year ended March 31, 2015 and 2016](Millions of yen)

Cash Flows from Operating Activities:
Income before income taxes
Depreciation and amortization
Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts andreserves
Increase (decrease) in reserve for loss on business of affiliate
Increase (decrease) for environmental measures
Increase (decrease) in net defined benefit liability and reserve fordirectors’ retirement benefits
Interest and dividends income
Interest expenses
Equity losses (earnings) of affiliates
Loss (gain) on sales of property, plant and equipment
Loss on disposal of property, plant and equipment
Loss on impairment
Loss on business withdrawal
Loss (gain) on sales of marketable securities and investments insecurities
Loss (gain) on valuation of investment securities
Loss (gain) on redemption of investment securities
Loss (gain) on change in equity
Decrease (increase) in notes and accounts receivables-trade
Decrease (increase) in inventories
Proceeds from sales of gold bullion deposited from customers
under consuming bailment My Gold Plan
Payment for purchases of gold bullion from market for customer
under My Gold Partner
Decrease (increase) in other current assets
Increase (decrease) in notes and accounts payable-trade
Increase (decrease) in accrued expenses
Increase (decrease) in other current liabilities
Increase (decrease) in other noncurrent liabilities
Other, net
SubtotalInterest and dividends income received
Interest expenses paid
Income taxes refund (paid)
Net Cash Provided by Operating Activities

19

Year Ended Mar. 31, 2015

Year Ended Mar. 31, 2016

(Apr. 1, 2014–Mar. 31, 2015)(Apr. 1, 2015–Mar. 31, 2016)

75,62853,911
2,835

82,68056,395
4,447

(54)

(38)

395

552
8,799

(4,187)

1,136(15,900)
8,233(6,557)(8,208)
3,183
499
-

(9,609)6,694(2,188)(5,863)
3,366
3,610
7,517

(1,696)(18,164)

9,278
(64)
(12,246)(8,613)

2,539(1,234)(10,464)(3,519)38,913

77,18879,994(76,957)(77,114)(13,741)
16,767
8,616
10,904(369)(5,469)113,347
17,399(8,392)(14,283)
108,070

17,373(16,188)
3,105(25,230)(20)(15,745)
131,743
12,139(7,173)(18,023)
118,685

(Millions of yen)

Cash Flows from Investing Activities:
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from sales of investment securities
Proceeds from redemption of investment securities
Payments for purchase of consolidated subsidiaries’ shares
Proceeds from sales of shares of subsidiaries
Purchase of shares of subsidiaries resulting in change in scope of
consolidation
Proceeds from sales of investments in subsidiaries resulting inchange in scope of consolidation
Payments for withdrawal
Payments for lending
Proceeds from repayment of lending
Other, net
Net Cash Used in Investing Activities
Cash Flows from Financing Activities:
Net increase (decreases) in short-term loans payable
Proceeds from long-term loans payable
Repayment of long-term loans payable
Increase (decrease) in commercial papers
Payments for redemption of bonds payable
Cash dividends paid
Purchase of treasury stock
Dividends paid to non-controlling interests
Other, net
Net Cash Used in Financing Activities
Effect of Exchange Rate Change on Cash and Cash
Equivalents
Net Increase (Decrease) in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of Period
Increase (Decrease) in Cash and Cash Equivalents Resulting
from Change of Scope of Consolidation
Cash and Cash Equivalents at End of Period

20

Year Ended Mar. 31, 2015

Year Ended Mar. 31, 2016

(Apr. 1, 2014–Mar. 31, 2015)(Apr. 1, 2015–Mar. 31, 2016)(54,821)
7,448(3,237)(2,116)
5,490
(471)
229

(71,469)
19,110(2,897)(2,922)
32,98718,000(132)--(15,572)

1,506

455

(1,775)
5,781
(399)

(7,548)(1,100)
1,942
(834)

(42,366)(29,982)

14,862
100,361(105,638)
5,000(40,000)(9,172)(88)(4,317)(3,279)(28,243)
31,433(79,917)(5,000)(20,040)(13,101)(90)(1,989)(3,527)(42,273)(120,477)

5,837(2,803)29,26862,078(34,577)
92,079732

980

92,07958,482

(5) Segment Information[Segment Information]
1. Overview of reporting segments(1) Method of determining reporting segments
The reporting segments of Mitsubishi Materials Corporation are those units of the Company for which
separate financial statements are available and which are subject to regular inspection for the use of theBoard of Directors in determining the allocation of resources and evaluating business results.
The Company has adopted an internal-company structure. As such, each internal company,
business unit and division proposes comprehensive strategy for operations both in Japan and overseas
with respect to the products and services it handles, and carries out operations on that basis.
Therefore, the Company divides its reporting segments according to individual products andservices, based on the internal-company structure. These reporting segments are Cement, Metals,
Advanced Materials & Tools, Electronic Materials & Components, and Aluminum, the last of thesebeing particularly important among the operations of each business unit and division.
(2)

Types of product and service belonging to each reporting segment
The main products in each business are as follows.
1) Cement
Cement,cement-related-products,
ready-mixed
concrete,aggregates
2) Metals
Copper smelting (copper, gold, silver, sulfuric acid, etc.),
processed-copper products
3) Advanced
Cemented carbide products, high-performance alloy products
Materials & Tools
4) Electronic Materials &Advanced materials, electronic components, polycrystalline
Components
silicon, chemical products5) Aluminum

Aluminum cans, rolled-aluminum products, processed aluminumproducts

2. Method of calculation of amounts in net sales, income/loss, assets, liabilities and other items for eachreporting segment
The accounting methods used in reporting business segments are the same as applied in “Basic important
items for preparation of the consolidated financial statements.”
Figures for income from reporting segments are based on ordinary income.
Internal income and transfers between segments are based on actual market prices.

21

3. Information related to sales, income/loss, total assets, total liabilities, and other items for reporting segment
For the year ended March 31, 2015 (From April 1, 2014 to March 31, 2015)(Millions of yen)
Advanced
Materials &Tools

Electronic
Materials &Components

Aluminum

OthersAmountindicated inthestatements ofincomeAdjustment
amountCementMetals

Total(1)Outside
Customers

189,674

803,394

113,534

56,009157,271

197,380

1,517,265-

1,517,265(2)Within
Consolidated
Group

3,625

8,239

21,112

10,9952,156

43,843

89,972(89,972)-

Total

193,300

811,633

134,647

67,005

159,427

241,224

1,607,238(89,972)

1,517,265

Segment
income16,72932,851

16,579

7,273

5,139

9,899

88,472(7,378)81,093

Segment assets

365,120

713,346

179,009126,124

154,021

195,517

1,733,139

165,017

1,898,157

Segment
liabilities

194,371557,872

98,426140,132

118,556

142,949

1,252,309

16,333

1,268,643

Depreciation
andamortization

10,99918,851

8,083

3,398

7,044

3,134

51,5102,400

53,911

Amortization of
goodwill

2,789

-

35

-

-

10

2,835

-

2,835

98

369

64

88

12

328

963

(355)

607

-

-

29

-

-

-

29

-

29

2,290

2,627

1,164

1,698

812

1,008

9,601

(1,367)

8,233

1,210

300

378

4,348

174

152

6,566

(8)

6,557

19,85919,236

5,591

56,151881

15,284

117,003(199)

116,804

16,74815,278

9,424

2,904

6,789

3,443

54,587

3,048

57,636

Net sales

Other items

Dividend
incomeAmortization ofnegativegoodwillInterest
expenses
Equity inearnings ofaffiliates
Investment toequity method
affiliate
Increase intangible andintangible
noncurrent
assets

Notes:
1. “Others” includes nuclear energy-related services, environmental and recycling-related business, realestate business, and engineering-related services.
2. Included in the segment income adjustment amount (-¥7,378 million) are segment eliminations (¥404
million) and corporate expenses that cannot be allocated to specific segments (-¥7,783 million).
Corporate expenses consist mainly of management-related costs, basic experimental research costs, andfinancial income/expenses.
3. Included in the segment assets adjustment amount (¥165,017 million) are segment eliminations(-¥40,257 million) and corporate assets that cannot be allocated to specific segments (¥205,275 million).
Corporate assets consist mainly of management-related assets and basic experimental research assets.
4. Included in the segment liabilities adjustment amount (¥16,333 million) are segment eliminations(-¥40,620 million) and corporate liabilities that cannot be allocated to specific segments (¥56,954
million). Corporate liabilities consist mainly of management-related liabilities and basic experimental
research liabilities.
5. Adjustment of increase of property, plant and equipment and intangible assets (¥3,048 million) consist
mainly of investment in Central Research Institute.
6. Segment income has been adjusted together with ordinary income on the consolidated statements ofincome.
22

For the year ended March 31, 2016 (From April 1, 2015 to March 31, 2016)(Millions of yen)
Advanced
Materials &Tools

Electronic
Materials &Components

Aluminum

OthersTotal

Amountindicated inthestatements ofincomeAdjustment
amountCementMetals(1)Outside
Customers

194,113680,431

133,550

56,374

156,854

196,750

1,417,895-

1,417,895(2)Within
Consolidated
Group

3,386

8,290

18,117

13,8801,810

46,697

92,182(92,182)-

Total

197,500

688,721

151,668

70,254

158,665

243,268

1,510,077(92,182)

1,417,895

Segment
income19,71027,048

14,965

6,339

3,641

9,936

81,642(9,199)72,442

Segment assets

353,523

654,099

221,620

107,402

149,446

190,276

1,676,370

117,005

1,793,375

Segment
liabilities

179,737

496,729

127,677

98,322

114,552

144,438

1,161,459(13,100)

1,148,358

Depreciation
andamortization

12,33515,757

11,257

3,428

7,322

3,511

53,612

2,782

56,395

Amortization of
goodwill

3,191

-

1,248

-

-

7

4,447

-

4,447

Dividend
income

74

327

71

117

11

435

1,038

(448)

589

Interest
expenses

1,923

2,014

1,078

999

712

935

7,664

(969)

6,694

1,358

(3,351)

610

4,152

107

(607)

2,270

(81)

2,188

20,33817,877

5,936

39,980740

13,96598,839(165)

98,674

17,561

22,96817,674

3,535

7,196

6,079

75,016

3,087

78,103

Net sales

Other items

Equity inearnings ofaffiliates
Investment toequity method
affiliate
Increase intangible andintangible
noncurrent
assets

Notes:
1. “Others” includes nuclear energy-related services, environmental and recycling-related business, realestate business, and engineering-related services.
2. Included in the segment income adjustment amount (-¥9,199 million) are segment eliminations (-¥61
million) and corporate expenses that cannot be allocated to specific segments (-¥9,138 million).
Corporate expenses consist mainly of management-related costs, basic experimental research costs, andfinancial income/expenses.
3. Included in the segment assets adjustment amount (¥117,005 million) are segment eliminations(-¥32,763 million) and corporate assets that cannot be allocated to specific segments (¥149,768 million).
Corporate assets consist mainly of management-related assets and basic experimental research assets.
4. Included in the segment liabilities adjustment amount (-¥13,100 million) are segment eliminations(-¥23,597 million) and corporate liabilities that cannot be allocated to specific segments (¥10,497
million). Corporate liabilities consist mainly of management-related liabilities and basic experimental
research liabilities.
5. Adjustment of increase of property, plant and equipment and intangible assets (¥3,087 million) consist
mainly of investment in Central Research Institute.
6. Segment income has been adjusted together with ordinary income on the consolidated statements ofincome.

23

[Reference information]
I. For the year ended March 31, 2015 (From April 1, 2014 to March 31, 2015)
1. Information by Product/Service
Omitted because the same information is written in the Segment Information.
2. Information by Region(1) Net sales(Millions of yen)Japan
917,811

U.S.
96,701

Europe25,812

Asia
462,596

Other
14,343

Total
1,517,265(2) Property, plant and equipment(Millions of yen)Japan
522,297

U.S.
92,047

Europe1,509

Asia
37,076

Other
2,104

Total
655,034

1. Categories for the countries and regions are geographically proximity-based.
2. Main countries and regions belong to the categories other than U.S.
(1) Europe: Germany, United Kingdom, Spain, France(2) Asia: Indonesia, South Korea, Malaysia, Singapore, China, Taiwan, Hong Kong, Thailand(3) Other: Australia, Canada, Brazil
3. Information by Customer
Omits because no customers account for 10% or more of net sales in the Consolidated Statement of Operations.
II.

For the year ended March 31, 2016 (From April 1, 2015 to March 31, 2016)

1. Information by Product/Service
Omits because the same information is written in the Segment Information.
2. Information by Region(1) Net sales(Millions of yen)Japan
910,894

U.S.
116,555

Europe30,414Asia
345,356

Other
14,673

Europe1,878

Asia
33,972

Other

Total
1,417,895(2) Property, plant and equipment(Millions of yen)Japan
542,148

U.S.
90,490

1,747

Total
670,237

1. Categories for the countries and regions are geographically proximity-based.
2. Main countries and regions belong to the categories other than U.S.
(1) Europe: Germany, United Kingdom, Spain, France(2) Asia: Indonesia, South Korea, Malaysia, Singapore, China, Taiwan, Hong Kong, Thailand(3) Other: Australia, Canada, Brazil
3. Information by Customer
Omits because no customers account for 10% or more of net sales in the Consolidated Statement of Operations.

24[Information related to Impairment Loss of Noncurrent Assets by Reported Segment]
For the year ended March 31, 2015 (From April 1, 2014 to March 31, 2015)(Millions of yen)
CementAdvanced
Materials& Tools

MetalsElectronic
Materials &Components

Aluminum

OthersCorporate or

Total

Loss on impairment
120
155
25
22
144
(Note) Adjustments of loss on impairment (¥31 million) consist mainly of that of idle assets.

elimination

467

31

Grand total

499

For the year ended March 31, 2016 (From April 1, 2015 to March 31, 2016)(Millions of yen)
CementAdvanced
Materials& Tools

MetalsElectronic
Materials &Components

Aluminum

OthersCorporate or

Totalelimination

Loss on impairment
329
1,818
1,368
3,516
93
(Note) Adjustments of loss on impairment (¥93 million) consist mainly of losses on impairment of lease assets.

Grand total

3,610[Information related to Amortization of Goodwill and Unamortized Balance by Reported Segments]
For the year ended March 31, 2015 (From April 1, 2014 to March 31, 2015)(Millions of yen)
CementAmortization for theyear ended Mar. 31,
2015
Balance on Mar. 31,
2015

MetalsAdvanced
Materials& Tools

Electronic
Materials &Components

Aluminum

OthersCorporate or

Totalelimination

Grand total

2,789

-

35

-

-

10

2,835

-

2,835

41,127

-

107

-

-

20

41,255(5)41,249Amortization of negative goodwill and unamortized balance incurred from a business combination before April 1,2010 are as below.
(Millions of yen)
CementAmortization for theyear ended Mar. 31,
2015
Balance on Mar. 31,
2015

MetalsCorporate

Advanced
Materials &Tools

Electronic
Materials &Components

Aluminum

OthersTotal

orGrand totalelimination

-

-

29

-

-

-

29

-

29

-

2,221

-

-

-

-

2,221

-

2,221

For the year ended March 31, 2016 (From April 1, 2015 to March 31, 2016)(Millions of yen)
CementAmortization for theyear ended Mar. 31,
2016
Balance on Mar. 31,
2016

MetalsAdvanced
Materials &Tools

Electronic
Materials&
Components

Aluminum

Corporate
OthersTotalorelimination

Grand
total

3,191

-

1,248

-

-

7

4,447

-

4,447

37,969-11,006--

10

48,986-48,986

Amortization of negative goodwill and unamortized balance incurred from a business combination before April 1,2010 are as below.
(Millions of yen)
CementAmortization for theyear ended Mar. 31,
2015
Balance on Mar. 31,
2015

MetalsCorporate

Advanced
Materials &Tools

Electronic
Materials &Components

Aluminum

OthersTotal

orGrand totalelimination

-

-

-

-

-

-

-

-

-

-

2,221

-

-

-

-

2,221

-

2,221

25

[Information on negative goodwill generated for each reporting segment]
For the year ended March 31, 2015 (April 1, 2014 to March 31, 2015)
None
For the year ended March 31, 2016 (April 1, 2015 to March 31, 2016)
None(6) Per-Share Information
Year Ended Mar. 31, 2015
(Apr. 1, 2014–Mar. 31, 2015)

Year Ended Mar. 31, 2016
(Apr. 1, 2015–Mar. 31, 2016)

Net assets per share¥420.36
Net income per share¥42.85
Note:- Net income per share after dilution is not indicated, as no diluted shares exist.
- The standards used to calculate net income per share are as follows.
Year Ended Mar. 31, 2015
(Apr. 1, 2014–Mar. 31, 2015)

Net income per share
Net income attributable to ownersof the parent (millions of yen)Amounts not attributable toordinary shareholders (millions ofyen)
Net income for common stock
attributable to owners of the parent(millions of yen)
Average number of shares
outstanding during the period(thousands of shares)¥423.83¥46.80Year Ended Mar. 31, 2016
(Apr. 1, 2015–Mar. 31, 2016)

56,14761,316--56,14761,316

1,310,342

1,310,101(7) Important Subsequent Events:
Change in the Number of Shares Constituting One Share Unit, Reverse Stock Split, etc.
At a Board of Directors meeting on May 12, 2016, the Company resolved to submit proposals to shareholders at the 91st
Ordinary General Meeting of Shareholders scheduled for June 29, 2016, relating to a change in the number of sharesconstituting one share unit and the total number of shares authorized to be issued, as well as a reverse stock split.
An overview of these resolutions is provided below.
(1) Reason for and Description of the Proposed Changes
Japanese stock exchanges have announced the Action Plan for Consolidating Trading Units, aiming to unify at 100
shares of common stock on Japanese stock exchanges the number of shares constituting one trading unit (share unit) in
the aim of enhancing convenience to investors and other market participants.
As the Company is listed on the Tokyo Stock Exchange, we shall respect this intention and change its number ofshares constituting one share unit from 1,000 shares to 100 shares. To maintain the Company’s share unit trading pricefollowing this change in the number of shares constituting one share unit, the Company proposes to conduct a reverse
stock split at a 10:1 ratio and change the total number of shares authorized to be issued from 3.4 billion shares to 340
million shares.
(2) Conditions for the Changes
These changes will become effective on October 1, 2016, pending approval of the proposal to shareholders at theOrdinary General Meeting of Shareholders of the change in the number of shares constituting one share unit and thetotal number of shares authorized to be issued, and the proposal of a reverse stock split.

26