Consolidated Financial Results for the Fiscal Year Ended March 31, 2019
(Japanese Accounting Standards)
May 13, 2019
Name of Listed Company: Mitsubishi Materials Corporation
Listing:
Tokyo Stock Exchange
Stock Code:
5711
URL:
http://www.mmc.co.jp/
Representative: Naoki Ono, President
Contact:
Nobuyuki Suzuki, General Manager, Corporate Communications Dept., General Affairs Dept.,
Human Resources & General Affairs Div.
Tel: +81-3-5252-5206
Scheduled date for ordinary general meeting of shareholders: June 21, 2019
Scheduled date of start of dividend payment:
June 3, 2019
Scheduled date of submission of securities report:
June 21, 2019
Supplementary materials for the financial results:
Yes
Investor conference for the financial results:
Yes (For Institutional Investors)(Amounts of less than million yen are omitted.)

1. Results of the Consolidated Fiscal Year Ended March 31, 2019 (From April 1, 2018 to March 31, 2019)(1) Consolidated Results of Operations(Figures in percentages denote the year-on-year change.)
Net salesYear ended March 31, 2019Year ended March 31, 2018

Operating profit

Net income attributableto owners of parent

Ordinary income

Million yen%

Million yen%

Million yen%

Million yen%

1,662,990
1,599,533

4.0
22.7

36,861
72,819-49.4
21.9

50,67979,621

-36.3
24.6

1,298
34,595-96.2
22.0(Note) Comprehensive income: Year ended March 31, 2019: -30,756 million yen (–%)

Net income
per share

Diluted net
income per share
Yen

Year ended March 31, 2019Year ended March 31, 2018Year ended March 31, 2018: 80,068 million yen (16.5%)

Yen

–
–

9.92
264.15

Ordinary income
to total assets

Return on equity(Reference) Equity in earnings of affiliates: Year ended March 31, 2019: 3,594 million yen

Operating profit
to net sales

%

%

%

0.2
5.3

2.6
4.1

2.2
4.6

Year ended March 31, 2018: -1,336 million yen(Note) The Company has been applying “Partial Amendments to Accounting Standard for Tax Effect Accounting” (ASBJ Statement No. 28 on February 16, 2018) fromthe beginning of the consolidated fiscal year under review. Individual figures related to the period ended March 31, 2018 have had the accounting standards applied
retroactively.

(2) Consolidated Financial Position
Total assets
As of March 31, 2019
As of March 31, 2018

Shareholders’equity ratio

Net assets

Net assets per share

Million yen

Million yen%

Yen

1,938,270
2,011,067

723,337
768,495

32.7
33.9

4,838.31
5,211.20(Reference) Shareholders’ equity: As of March 31, 2019: 633,582 million yen

As of March 31, 2018: 682,471 million yen(Note) The Company has been applying “Partial Amendments to Accounting Standard for Tax Effect Accounting” (ASBJ Statement No. 28 on February 16, 2018) fromthe beginning of the consolidated fiscal year under review. Individual figures related to the period ended March 31, 2018 have had the accounting standards applied
retroactively.

(3) Consolidated Cash Flows
Cash flow fromoperating activities
Year ended March 31, 2019Year ended March 31, 2018

Cash flow frominvesting activities

Cash flow fromfinancing activities

Cash and cash equivalents
at end of period

Million yen

Million yen

Million yen

Million yen

140,168
50,715-86,238-83,957-47,613-11,034

99,67287,355

2. Dividend Payments
Dividends per share(Record date)First
quarter
Yen

Year ended March 31, 2018Year ended March 31, 2019Year ending March 31,
2020 (Forecast)Secondquarter

Third
quarter

Yen

Yen

Year-end

AnnualTotal dividend
amount(annual)Dividend payout
ratio(consolidated)

Dividends to net
assets(consolidated)

Yen

Yen

Million yen

%

%

–
–

30.00
40.00

–
–

50.00
40.00

80.00
80.00

10,477
10,476

30.3
806.6

1.6
1.6

–

40.00

–

40.00

80.00

3. Consolidated Earnings Forecast (From April 1, 2019 to March 31, 2020)

34.9(Figures in percentages denote the year-on-yearchange.)Net sales
Six months ending
September 30, 2019Year ending March 31,
2020

Operating profit

Net income
attributable toowners of parent

Ordinary income

Net income
per share

Million yen%

Million yen%

Million yen%

Million yen%

Yen

830,000-3.0

23,000-16.7

24,000-27.4

12,000

-19.2

91.63

1,700,000

2.2

51,00038.4

62,00022.3

30,000–229.08

* Notes(1) Significant changes of subsidiaries during the term under review (changes in specific subsidiaries accompanied bya change in the scope of consolidation):
None(2) Changes in accounting policies, changes of accounting estimates and restatement(i)
Changes in accounting policies due to amendments to accounting standards:(ii) Other changes in accounting policies:(iii) Changes in accounting estimates:(iv) Restatements:

None
None
None
None

(3) Numbers of issued shares (common stock)(i)
Numbers of issued shares at end of terms (including treasury shares):Year ended March 31, 2019:
131,489,535 sharesYear ended March 31, 2018:
131,489,535 shares(ii)
Numbers of treasury shares at end of terms:
Year ended March 31, 2019:538,493 sharesYear ended March 31, 2018:
527,089 shares(iii) Average number of shares issued during terms:
Year ended March 31, 2019:
130,956,379 sharesYear ended March 31, 2018:
130,972,453 shares(Reference) Summary of Non-Consolidated Financial Results
Results of the Non-Consolidated Fiscal Year Ended March 31, 2019 (From April 1, 2018 to March 31, 2019)(1) Non-Consolidated Results of Operations(Figures in percentages denote the year-on-year change.)
Net salesYear ended March 31, 2019Year ended March 31, 2018

Operating profit

Net income%

Million yen%

Million yen%

Million yen%

852,820869,677-1.9
28.9-10,949
13,732

–
13.3

5,169
31,370-83.5
15.3-13,568
25,530–29.6

Net income
per share

Diluted net
income per share
Yen

Year ended March 31, 2019Year ended March 31, 2018

Ordinary income

Million yen-103.61194.93Yen––(2) Non-Consolidated Financial Position
Total assets
As of March 31, 2019
As of March 31, 2018
(Reference) Shareholders’ equity:

Shareholders’equity ratio

Net assets

Net assets per share

Million yen

Million yen%

Yen

1,269,756
1,355,347

463,862
533,103

36.5
39.3

3,542.19
4,070.58

As of March 31, 2019: 463,862 million yen

As of March 31, 2018: 533,103 million yen(Note) The Company has been applying “Partial Amendments to Accounting Standard for Tax Effect Accounting” (ASBJ Statement No. 28 on February 16, 2018) fromthe beginning of the consolidated fiscal year under review. Individual figures related to the period ended March 31, 2018 have had the accounting standards applied
retroactively.

* This financial results is outside the scope of audit procedures by certified public accountants and audit firms.
* Explanation about the proper use of financial forecasts and other special notes(Notes concerning forward-looking statements, etc.)
The operating results forecasts and other forward-looking statements contained in this report are based on information currently
available to the Company, as well as certain assumptions that the Company has judged to be reasonable. As such, they do notconstitute an assurance that the Company promises to achieve these projected results. Therefore, readers are advised to note that theactual results may vary materially from the forecasts due to a variety of factors.
Please see “(1) Overview of operating results, Outlook for the year ending March 31, 2020” of “1. Overview of Operating Resultsand Financial Position” on page 4 for the assumptions about consolidated earnings forecasts.
(Procedure for obtaining supplementary materials and investor conference for the financial results)
Mitsubishi Materials Corporation plans to hold an investor conference for institutional investors on Monday, May 13, 2019.
The supplementary materials used at this conference are disclosed on the TDnet and the Company’s web page at the time that thefinancial results are announced.

Contents

1. Overview of Operating Results and Financial Position ...................................................................... 2(1) Overview of operating results ................................................................................................................ 2(2) Overview of financial position .............................................................................................................. 5(3) Basic profit distribution policies and dividend payments for the current and next fiscal years ............ 5(4) Business and other risks ........................................................................................................................ 6
2. Management Policies ........................................................................................................................ 10(1) Basic Policy for the Group Management............................................................................................. 10(2) Target Management Indicators and Medium- to Long-term Management Strategy and Issues to Be
Addressed ............................................................................................................................................ 10
3. Basic Concept of Selection of Accounting Standards ....................................................................... 14
4. Consolidated Financial Statements.................................................................................................... 15(1) Consolidated balance sheet .................................................................................................................. 15(2) Consolidated statement of income and consolidated statements of comprehensive income ............... 17
Consolidated statement of income ...................................................................................................... 17
Consolidated statements of comprehensive income ........................................................................... 18(3) Consolidated statement of changes in equity....................................................................................... 19(4) Consolidated statement of cash flows.................................................................................................. 21
Segment Information .......................................................................................................................... 23
Per-share Information ......................................................................................................................... 28
Important Subsequent Events ............................................................................................................. 29–1–

1. Overview of Operating Results and Financial Position(1) Overview of operating results1) Overview of performance
During the consolidated fiscal year under review, although signs of an economic slowdown were seen in
China, a moderate recovery was seen in the Asian economies of Thailand and Indonesia. In the United States,
the economy continued to improve steadily.
In Japan during the consolidated fiscal year under review, employment and income conditions were on theroad to recovery, and capital expenditure showed signs of increasing. However, improvement in corporate
earnings and growth in industrial production appeared to slow down.
Regarding the business environment for the Mitsubishi Materials Group, although demand related to
cemented carbide products and cement held firm, factors such as falling copper prices and rising energy costs
had a negative impact.
Under these circumstances, in accordance with its Long-Term Management Policy for the next 10 years andMedium-Term Management Strategy (FY2018-2020) that focuses on the planning and implementation of
growth strategies, the Mitsubishi Materials Group continued to implement various measures as the theme of“Transformation for Growth” to achieve group-wide policies for the enhancement of corporate value, namely“optimization of business portfolio,” “comprehensive efforts to increase business competitiveness,” and“creation of new products and businesses.”
As a result, consolidated net sales for the fiscal year under review totaled ¥1,662,990 million, up 4.0% year
on year. However, given the impact of factors such as higher costs for smelting and inventory shortage loss
posted at the end of the fiscal year in the Metals business, operating profit fell 49.4% year on year, to ¥36,861
million, and ordinary income dropped 36.3%, to ¥50,679 million. As a result of examining the recoverabilityof deferred tax assets based on various factors such as operating results during the consolidated fiscal year
under review and the outlook for the future, the Company reversed ¥8.7 billion of its non-consolidated
deferred tax assets. As a result, net income attributable to owners of parent fell 96.2%, to ¥1,298 million.
2) Overview by business segments
From this fiscal year, the reporting segments have been changed, among other changes. The details are set
forth in “Segment Information” of “4. Consolidated Financial Statements.” In this regard, in comparison withthe data of the previous fiscal year below, the numerical data obtained upon the reclassification of thenumerical data for the previous fiscal year under the changed segments is used.
(Advanced Products)

Net sales
Operating profit
Ordinary income

FY 2018
536.0
18.4
18.4

FY 2019
570.9
11.9
13.2

(Billion yen)
Increase / Decrease (%)
34.9(6.5%)-6.4(-35.1%)-5.2(-28.5%)In the copper and copper alloy products business, net sales increased and operating profit decreased as aresult of an increase in the costs of raw materials, despite the sales increase that was mainly attributable to thecontribution of MMC Copper Products OY to the consolidated results from the beginning of the fiscal year.
In the electronics materials & components business, both net sales and operating profit decreased, reflecting
decline in sales of products such as products for displays, for LSI of smartphones, and for opticalcommunications related equipment.
In the aluminum products business, net sales increased due to a rise in aluminum prices, despite a decrease in–2–the sales volumes of beverage aluminum bottle cans and rolled and processed products such as extruded
products for automobiles and plate products for litho sheets. While, energy costs rose. As a result, thealuminum products business posted an increase in net sales and a decrease in operating profit.
Consequently, net sales for the entire Advanced Products increased year on year, but operating profit
decreased. Ordinary income declined due to the decrease in operating profit.
(Metalworking Solutions Business)

Net sales
Operating profit
Ordinary income

FY 2018
161.1
18.5
16.8

FY 2019
171.5
16.7
15.6

(Billion yen)
Increase / Decrease (%)
10.3(6.4%)-1.7(-9.7%)-1.1(-7.1%)In the cemented carbide products business, net sales and operating profit increased as a result of strong sales
mainly in Japan, Europe, United States, China and Southeast Asia.
In the sintering parts, etc. business, net sales increased due to growth in demand for mainstay sintering partsin Japan and North America. However, the operating loss expanded due to the increased costs associated withquality inspection and shipments.
Consequently, net sales for the entire Metalworking Solutions business increased year on year, but operating
profit decreased. Ordinary income declined mainly due to the decrease in operating profit.
(Metals Business)

Net sales
Operating profit (loss)
Ordinary income

FY 2018
715.3
12.7
25.4

FY 2019
720.0
-7.1
2.3

(Billion yen)
Increase / Decrease (%)
4.7(0.7%)
-19.9
(–%)
-23.0
(-90.9%)In the copper business, both net sales and operating profit decreased, mainly due to the lower production
volume resulting from periodic furnace repairs at PT. Smelting in Indonesia and Naoshima Smelter andRefinery and the increased costs for smelting.
In the gold and other valuable metals business, net sales increased while operating profit declined, mainly
because of the inventory shortage loss posted at the end of the fiscal year, despite increased production ofgold as a result of a rise in the amount contained in raw materials.
As a result, overall the Metal business posted year-on-year increase in net sales, but operating profit declined.
Ordinary income decreased due to the decrease in operating profit and dividend income.
(Cement Business)

Net sales
Operating profit
Ordinary income

FY 2018
192.3
19.4
21.0

FY 2019
198.2
13.4
15.4

–3–

(Billion yen)
Increase / Decrease (%)
5.9(3.1%)-5.9(-30.6%)-5.5(-26.6%)

Despite the firm performance of construction work of facilities related to the Tokyo Olympic and Paralympic
Games in the Tokyo metropolitan area, as well as the extension work of the Hokuriku Shinkansen in the
Hokuriku area in Japan, mainly rising energy costs resulted in a decline in operating profit, even as net sales
increased.
In the United States, although the sales price of ready-mixed concrete rose, given an increase in fuel andother costs, net sales increased and operating profit decreased.
Consequently, net sales for the entire Cement business increased year on year, but operating profit decreased.
Ordinary income declined mainly due to the decrease in operating profit.
(Others Business)

Net sales
Operating profit
Ordinary income

FY 2018
249.5
13.1
8.3

FY 2019
255.7
13.1
14.6

(Billion yen)
Increase / Decrease (%)
6.2(2.5%)-0.0(-0.1%)
6.3(76.3%)In the energy-related business, net sales decreased but operating profit increased due to a rise in the sales
price of coal as well as the solid performance of the hydroelectric power generation business and the businessof supplying steam to geothermal power plants, despite a decline in sales of nuclear energy-related business.
In the environment recycling business, net sales increased and operating profit decreased due to the costs
incurred for the launch of new business, despite an increase in recycling volumes.
Others business excluding the energy-related business and the environmental recycling business, both net
sales and operating profit increased.
In the overall Others business, net sales increased year on year, but operating profit decreased. Ordinary
income increased, reflecting a decrease in equity in losses of affiliates.
3) Outlook for the fiscal year ending March 31, 2020
Although the U.S. economy is expected to grow steadily, the future of the global economy is uncertain, withsome recent economic indicators pointing to a slowdown in the U.S. economy, and with the impact of an
escalation in trade tensions and economic slowdown in China.
We believe the Japanese economy will continue its modest recovery driven by domestic demand, amid
continued improvements in the employment and income conditions. However, we are concerned that global
economic slowdown will cause decline in exports and recognize that there may be a downside risk to theJapanese economy due to overseas political and economic trends.
Turning to the Group’s operating environment, besides the uncertainness of the domestic economic outlook,rising energy costs and worsening labor shortages are also concerns.
Against this backdrop, the Group will implement measures such as to strengthen the group governanceframework, including quality control outlined in “2. Management Policies.”
For the fiscal year ending March 31, 2020, our consolidated operating performance forecasts predict net salesof ¥1,700.0 billion, operating profit of ¥51.0 billion, ordinary income of ¥62.0 billion, and net income
attributable to owners of parent of ¥30.0 billion on the assumption of average exchange rates of ¥110/USD
and ¥125/EUR and a copper price of 290¢/lb.

–4–

(2) Overview of financial position
Total assets at the end of the consolidated fiscal year under review stood at ¥1,938.2 billion, down ¥72.7 billion
from the end of the previous consolidated fiscal year. This result was mainly due to a decrease in investment
securities.
Total liabilities were ¥1,214.9 billion, a decrease of ¥27.6 billion from the end of the previous consolidated fiscal
year. This was mainly due to a decrease in the current portion of bonds payable.
The cash flows during the consolidated fiscal year under review and their causes are as follows.
(Cash flow from operating activities)
Net cash provided by operating activities amounted to ¥140.1 billion (an increase in net cash provided of ¥89.4
billion year on year). This rise was primarily due to a decrease in inventories in addition to income before
income taxes.
(Cash flow from investing activities)
Net cash used in investing activities totaled ¥86.2 billion (an increase in net cash used of ¥2.2 billion year onyear). This cash was primarily used for outlays related to capital expenditure.
(Cash flow from financing activities)
Together, operating and investing activities produced a net inflow of ¥53.9 billion, and the Company allotted
these funds for the redemption of bonds, among other matters. Accordingly, net cash used in financing activitieswas ¥47.6 billion (an increase in net cash used of ¥36.5 billion yen year on year).
As a result of the above, as well as the effect of exchange rate change and other factors, the balance of cash andcash equivalents as of March 31, 2019 stood at ¥99.6 billion, up ¥12.3 billion from March 31, 2018.
Below is a summary of the major cash flow indicators.
FY2015FY2016FY2017FY2018FY2019

Shareholders’ equity ratio (%)

29.0

31.0

32.8

33.9

32.7

Shareholders’ equity ratio on amarket-value basis (%)

27.9

23.2

23.3

20.8

19.7

Ratio of interest-bearing debt tocash flow

6.0

4.6

4.7

10.6

3.7

Interest coverage ratio

12.9

16.5

23.3

10.0

28.9

Shareholders’ equity ratio:
Shareholders’ equity / Total assets
Shareholders’ equity ratio on a market-value basis: Market capitalization / Total assets
Ratio of interest-bearing debt to cash flow:
Interest-bearing debt / Cash flow
Interest coverage ratio:
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
and outstanding at year-end (after deducting treasury shares).
(Note 3) Cash flow is based on the cash flow from operating activities in the Consolidated Statements of Cash
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 for the current and next fiscal years
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 shareholders as one of our most importantpriorities. Accordingly, our policy is to make decisions on profit appropriation based on comprehensive–5–

consideration of various factors related to overall management, such as income over the relevant period,
retained earnings, and financial position.
During the period of the Medium-Term Management Strategy, from FY2018 to FY2020, the Company isemphasizing the distribution of consecutive dividends even if the Company’s performance is changed. The
Company will pay annual dividends 80 yen per share during the FY2018-2020 period. If the consolidated
dividend payout ratio is lower than 25%, the Company will temporarily increase the dividend or purchasetreasury stock.
Based on this policy, the Board of Directors, at its meeting on May 13, 2019, decided to distribute a year-end
dividend of ¥40, which, combined with the interim dividend of ¥40, brings the annual dividend for the fiscal
year under review to ¥80 yen per share (same as the previous fiscal year).
The Company plans to pay a dividend of ¥80 per share (¥40 interim dividend and ¥40 year-end dividend) for
the fiscal year ending March 31, 2020.

(4) Business and other risks
Because the Group, as stated in “Segment Information” of “4. Consolidated Financial Statements” is engaged
in a broad variety of business activities, its business results and financial position are influenced by all kinds offactors such as political affairs, economy, weather, market conditions, currency movements, and laws andordinances, both inside and outside the country. Listed below are 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 13, 2019.
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, while at the same time actively conducting
revisions, reorganizations, and restructuring of its businesses, always ready to consider possibilities regarding
collaboration with other companies. These results may affect the business results and financial position of theGroup.
2) Market and customer trends
The Group provides products and services to all kinds of industries, and factors such as changes of theconditions of the world economy, rapid changes in customers’ markets, changes in customers’ market share,
and changes in customers’ business strategies or product development trends may influence the sales of the
products of the Group. Especially the automobile industry and IT-related industry are exposed to intensecompetition in the area of prices and technical development, and while the Group takes every precaution
endeavoring to reduce the costs and develop new products and technologies, in cases where we cannot
appropriately respond to the changes in industries and customers’ markets, the business results and financial
position 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 denominatedin foreign 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 TC/RC. Furthermore, in the area of
inventories, there is the risk of rates for nonferrous metals and exchange fluctuation influencing the material
costs in the period from the procurement of the ore to the production and sales of the metals.

–6–

Also, such items as nonferrous metals used as raw materials in the Aluminum business and the Metalworking
Solutions business as well as coal in the Cement business are international merchandise, and the acquisition
cost of these raw materials and mineral fuel can be influenced by fluctuation of market prices, exchange rate,
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 thebusiness results and financial position of the Group may be influenced by conditions of the semiconductor
market.
5) Interest-bearing debt
In the term ended March 31, 2019, the interest-bearing debt of the Group of ¥494.7 billion (which is the sum
total of short-term loans payable, commercial papers, bonds payable, and long-term loans payable; same
below if there are no explanatory notes) accounts for 25.5% of the total assets. Although we are making
efforts to improve the financial position by reducing inventories, asset sales, etc., the future financial
situation may affect the business results and financial position of the Group.
6) Guaranty of liabilities
In the term ended March 31, 2019, the Group has undertaken ¥19.9 billion guaranty of liabilities against
monetary liabilities of affiliated companies, which are not included in the scope of consolidation. In cases
where a situation arises in the future in which we are requested to fulfill these guaranties of liabilities, thismay affect the business results and financial position of the Group.
7) Fluctuations of the market value of assets
Fluctuations in the market value of securities, land, and other assets possessed may affect the business results
and financial position of the Group.
8) Retirement benefit expenses and obligations
Employees’ retirement benefit expenses and obligations are calculated based on assumptions and conditions
mainly derived from actuarial 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, butlosses caused by declines 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, water pollution, and soil pollution, in accordance with environmental laws andordinances, and in dealing with abandoned mines within the country is endeavoring to control mine pollutionby, for example, preventing water pollution from mine water or management of the dumps in accordancewith the Mine Safety Act. However, in cases where related laws are revised or permissible greenhouse gas
emission volumes are limited, the Group may need to bear new expenses, and this may affect the businessresults and financial position of the Group.
10) Overseas operations, etc.
The Group has production bases, sales bases, and other bases in 31 countries and regions abroad and foreign
sales account for 44.9% of its consolidated net sales. The business results and financial position of the Group–7–

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 ofmanagement 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 in cases 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 position of the Group. At the same time,
although the Group handles the intellectual property rights held by other companies with the greatest possiblecare, in cases where it is established that we have infringed on the intellectual property rights held by othercompanies and have to pay liabilities, such as compensation for damages, this may also affect the businessresults and financial position of the Group.
12) Quality of the products
The Group aims to provide high quality products and is working to strengthen its quality control framework.
However, if the Group incurred compensation and other expenses not foreseen at present in relation to
products manufactured and sold in the past, or if a major quality issue occurred and the Group’s sales
activities were affected by a loss of trust, or the Group incurred expenses necessary to improve andstrengthen its quality control framework or compensation and other expenses, these may affect the businessresults and financial position of the Group.
13) Occupational health and safety, equipment accidents, etc.
The Group takes thoroughgoing measures to prevent occupational accidents and incidents involving
production machinery. Our efforts span both intangible aspects such as management frameworks foroccupational health, safety, security and accident prevention, and tangible approaches such as operational andmaintenance management and improving the safety of equipment. In the event of a major accident at work or
an accident to the equipment, this may affect the business results and financial position 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 position of
the Group.
15) Lawsuits, etc.
The business results and financial position 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 businessconducted by the Group presently or in the past within the country or in foreign countries.

–8–16) Procurement of electricity
The business results and financial position of the Group may be influenced by increases in the prices forelectricity resulting from such factors as cost increases of imported fossil fuels due to the suspension ofoperation of nuclear power stations and increases in charges for renewable energy.
17) Operating Result of Diamet Corporation
Diamet Coporation., a consolidated subsidiary of the Company, has continuously posted operating losses andimpairment losses on non-current assets, and is in a state of excessive liabilities. Although the Company has
provided financing to Diamet Corporation to continue its business, if deterioration in the subsidiary's
operating results continues in the future, it may affect the business results and financial position of the Group.
18) Other matters
In addition to the above, the business results and financial position of the Group may be influenced bychanges in trade practices, earthquakes, flood and other natural disasters, terrorist attacks, wars, epidemics,
and other unexpected circumstances.

–9–2. Management Policies(1) Basic Policy for the Group Management
The vision of the Group is “We will become the leading business group committed to creating a sustainable
world through materials innovation, with the use of our unique and distinctive technologies, for People,
Society and the Earth.” based on a corporate philosophy of “for People, Society and the Earth.”(2) Target Management Indicators and Medium- to Long-term Management Strategy and Issues
to Be Addressed
The Group will pursue a number of measures based on the “Long-Term Management Policy”, which looks
ahead 10 years, and the “Medium-Term Management Strategy” for FY2018-FY2020, starting with “Measures
to Enhance the Group Governance Framework Including Quality Control.”1) Measures to Enhance the Group Governance Framework Including Quality Control
The Company sincerely apologizes to its customers, shareholders, and all other parties for any and allinconvenience again in connection with the delivery of some of the products manufactured and sold in thepast that deviated from customer standards or internal company specifications, due to misconduct including
the rewriting of inspection records data and the insufficient testing, and the revocation of JIS certification forcopper slag aggregates in Naoshima Smelter and Refinery, which were announced from November 2017
through to June 2018.
In connection with these incidents, the Company’s consolidated subsidiaries Mitsubishi Cable Industries,
Ltd., Diamet Corporation and Mitsubishi Aluminum Co., Ltd. were found guilty of violating the Unfair
Competition Prevention Act by Tokyo Summary Court in February 2019.
Meanwhile, the Group has been validating the safety of products with the cooperation of customers and has
confirmed with respect to all customers that there are no problems with any major aspects of safety.
The Company and the Group will continue to implement and further develop the following “Restructuring
Measures of the Governance Framework for Quality Control in the Group” and the “Governance Framework
Enhancement Measures of the Group,” in order to prevent such situations again in the future.
(i) Restructuring Measures of the Group Governance Framework for Quality ControlA) Implementation of a Front Loading System for Order ReceivingB) Enhancement of the Framework and Authority of the Quality Control Department
C) Expansion of Quality TrainingD) Promoting Automated Inspection Equipment
E) Enhancement of Quality Audits
F) Utilization of Outside Consultant(ii) Group Governance Framework Enhancement MeasuresA) Enhancement of Framework for Discussion, Reporting and Follow-up of Governance-Related MattersB) Improvement of Functions of Management Divisions and its Collaboration with Operating DivisionsC) Improvement of Human Resources Training and Encouragement of Active Interaction
D) Audit StrengtheningE) Studies with a Business Optimization Focus– 10 –

2) Long-term Management Policy
The businesses of the Group have set the Medium- to Long-Term Targets (the company in the future) and theGroup-wide Policy as the Long-Term Management Policy as described below, to realize the vision describedin the “Basic Policy for the Group Management in (1)” above.
<Medium- to Long-term Targets (the company in the future)>- Leading company in domestic and overseas key markets- Achieving high profitability and efficiency- Achieving growth that exceeds the market growth rate
<Group-wide Policy>- Optimization of business portfolio- Comprehensive efforts to increase business competitiveness- Creation of new products and businesses
3) Management Policies in the Medium-Term Management Strategy (for FY2018-FY2020)
In the Medium-Term Management Strategy, we will pursue the Group-Wide Policy set in the Long-termManagement Policy. To achieve a “accommodation to changes in the external environment” and the “Build astructure focusing on strategy,” which were the issues in the previous Medium-Term Management Plan, we
have made the shift from the “Medium-Term Management Plan” centering on financial plans in the past to
the “Medium-Term Management Strategy” focusing on the planning and implementation of growthstrategies.
(i) Optimization of business portfolio
The Company will classify its business into three categories: “stable growth business,” “growth promotion
business” and “profitability restructuring business,” and will promote selection and concentration andimprove capital efficiency after determining a direction geared to the characteristics of each business andclarifying any issues. Stable growth business consists of the Cement, Metals (smelting), Recycling andrenewable energy businesses, and in this category, the Company will aim to strengthen its businessfoundations by maintaining and improving cost competitiveness. Growth promotion business consists of theMetals (copper and copper alloy products) and Advanced materials & tools businesses, and here theCompany will seek business development in adjacent fields and global markets to outperform market growth.
Profitability restructuring business consists of the Electronic materials & components and Aluminumbusinesses. In this category, the Company will work promptly to solve issues and define the future directionof growth.
(ii) Comprehensive efforts to increase business competitivenessWe will improve and innovate “manufacturing” in the business divisions through the optimal use oftechnology management resources by enhancing the support system by the corporate divisions. With this, wewill make comprehensive efforts to increase our business competitiveness by promoting “Differentiation”
and “New development,” such as the development of new products and new manufacturing technologies, tobecome an entity that is one step ahead of other companies through early responses to changes in the businessenvironment.
(iii) Creation of new products and businesses
To foster businesses that will become a future revenue foundation and create new businesses, we will create
and foster new products and new businesses that will become the core for sustainable growth by positioning
important social needs the Company should meet are identified as “next-generation vehicles,” “internet of– 11 –

things (IoT) and artificial intelligence (AI),” and “building a rich, sustainable society.” The Company plans tocreate and develop new products and new businesses that are vital for sustainable development.
In addition, we will promote specific measures, with the following items as key strategies.
- Achieve growth through innovation- Create value by building a recycling-oriented society- Increase the company’s market presence through investment for growth- Increase efficiency through continuous improvement<Issues in each business>● Advanced Products
In the copper and copper alloy products business, demand of automotive and other products is expected toremain stable. In this environment, we will continue to increase profitability by creating business synergy with
MMC Copper Products Oy, which was included in the scope of consolidation from the previous fiscal year, andby enhancing sales competitiveness through the accelerated development of high-value added products,
drawing on our technological and development capabilities.
In the electronics materials & components business, demand of products for home appliances and automotive
is expected to grow, and demand of products for semiconductor manufacturing equipment is also expected torecover from the second half of FY2020. In these circumstances, we will strive to enhance profitability byusing our core technological capabilities and strengthening our sales competitiveness and our ability to makeproposals to customers, always remaining a step ahead of customers’ needs in each market. In thepolycrystalline silicon, the business environment is expected to remain difficult. However, we will make efforts
to further improve quality and reduce costs to establish business foundations, with safety and stable operation
as the top priorities.
In the aluminum products business, growth in demand of heat exchanger sheet materials for automobiles andfoil products for lithium-ion battery, which are rolled and processed aluminum products, are expected. We will,
therefore, work to strengthen production capacity and improve productivity and will also promote theestablishment of global supply system mainly in North America, and the development of high-value added
products. In the beverage aluminum bottle cans, we will develop and increase sales of diverse products,
including upsized cans and cans with many different shapes, and we will endeavor to maintain and increase
competitiveness.
● Metalworking Solutions Business
The market condition for cemented carbide products is expected to remain generally firm despite concern overthe impact of the economic slowdown in China. Under these circumstances, we will continue to conduct
effective sales operations, focusing on industries and regions with high growth potential. In particular, we willprioritize the investment of our management resources in the aerospace industry, which is in the growth stages,
and seek to strengthen manufacturing, R&D and sales functions. In the area of cutting tools, under the twobrands DIAEDGE (Mitsubishi Materials Corporation) and MOLDINO (Mitsubishi Hitachi Tool Engineering,Ltd.) we will work on provided customer-oriented solutions that will build customer trust as a true partner. In
particular, we are promoting the establishment of new technology centers and the enhancement of theirfunctions and capacity in key regions around the world and will continue to do so in the future. Regarding thesourcing of key materials, tungsten and cobalt, we will continue working to reduce sourcing risks and sourcing
costs by improving the recycling amount of tungsten and diversifying procurement sources.
Turning to sintering parts, etc., in order to increase earnings of this business, we will work to enhance quality
and productivity by introducing automated inspection equipment to save labor and implementing measures to– 12 –

improve yield ratio. In addition, Diamet Corporation which manufactures and sells sintering parts has
continuously posted operating losses and impairment losses on non-current assets, and is in a state of excessive
liabilities. The Company has set a commitment line and has provided financing to Diamet Corporation.
● Metals Business
The supply capacity of copper mines is not expected to be able to keep pace with rising demand for copper
concentrate resulting from the startup of new smelters and the expansion of existing smelters in countries suchas China and India, and conditions for TC/RC are also expected to deteriorate in the short term.
Regarding the copper business, demand for area of electric wire is expected to remain firm in connection with
the Tokyo Olympic and Paralympic Games and redevelopment in the Tokyo metropolitan area, and demand forarea of rolled copper products appears to have plateaued slightly but is expected to remain solid, particularly
for automotive. However, we will keep a close watch on future trends because the uncertainty caused by thetrade tensions between the US and China, Brexit and the economic slowdown in China pose downside risks fordemand and copper prices.
Under these circumstances, in copper mining business, we will focus on improving existing projects anddeveloping new projects and will support smelter’s operations by providing smelters with a stable supply ofclean copper concentrate with minimum impurities. In the new Zafranal Project (Peru), we plan to complete
the feasibility study during 2019 and move on to the task of acquiring environment licenses and permits.
In copper smelting and refining business, thanks to our efforts to expand our processing capacity of E-Scrap byimproving facilities and strengthening our collection system, E-Scrap processing capacity of the Group is
expected to reach 160,000 tons per year. In the future, we aim to strengthen profitability by fully utilizing ourworld-leading collection and processing capacity.
However, with the increase in E-Scrap processing amount, the volumes and types of impurities that are input tothe smelting process increase, making the recovery rate of valuable metals are lower. We are, therefore, making
improvements to operations by such as expanding facilities to deal with the problem and this has proved
effective to some degree. At the same time, we are also optimizing management of E-Scrap yards andstrengthening inventory management. In the future, we will continue to focus on further improvements andpromote enhancement of E-Scrap processing technologies. We will also seek to optimize the material balance
which is becoming increasingly complex due to the processing of diverse raw materials by promoting stronger
collaboration with each production location and working on the establishment of a more efficient recovery
system for valuable metals.
● Cement Business
In Japan, although demand is anticipated from an increase in public works under the “three-year emergency
response plan for disaster prevention, disaster mitigation, and building national resilience”, redevelopment
project in the Tokyo metropolitan area and construction projects of Shinkansen, there is also concern overdelays in construction due to labor and transport capacity shortages. Therefore domestic demand for cement in
FY2020 is estimated at around 42.50 million tons, unchanged from FY2019. In these circumstances, we will
strive to secure sales volumes by steadily taking in demand for cement for the large projects.
In the United States, demand for cement and ready-mixed concrete is expected to remain firm because public
works are in an upward trend mainly due to the government’s policy of investing in infrastructure. While risinglabor costs, fuel and energy costs will be a factor affecting profitability, we will pass cost increases on tocustomers as appropriate. We will also reduce the cost of cement through improvement of plant facilities andexpand sales of ready-mixed concrete through the operation of new ready-mixed concrete plants and aim forfurther improvement in sales and profit.

– 13 –

3. Basic Concept of Selection of Accounting Standards
The Group’s policy is to prepare its consolidated financial statements in accordance with Japanese AccountingStandards for the time being, taking into consideration the comparability of consolidated financial statements
between different accounting periods and against different companies.
We plan to act appropriately in adopting International Financial Reporting Standards (IFRS), taking various
circumstances into consideration.

– 14 –

4. Consolidated Financial Statements(1) Consolidated balance sheet
As of March 31, 2018
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade
Merchandise and finished goods
Work in process
Raw materials and supplies
Gold receivable
OthersAllowance for doubtful accounts(Million yen)
As of March 31, 2019

93,389260,427
91,772132,043
142,275
88,862
138,824(2,518)

108,648248,220
92,452
108,293
134,825
99,154
120,954(2,900)945,077

909,647

Non-current assets
Property, plant and equipment
Buildings and improvements, net
Machinery, equipment and vehicles, net
Land, net
Construction in progress
Other, net

153,490
217,620
236,709
23,105
14,632

157,448
243,815
235,664
34,211
16,275

Total property, plant and equipment

645,559

687,415

44,636
19,93840,816
17,92464,57458,740303,924449
22,96532,813(4,297)

236,572
1,050
19,61029,322(4,088)

Total current assets

Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Net defined benefit asset
Deferred tax assets
OthersAllowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets– 15 –

355,855

282,467

1,065,989

1,028,622

2,011,067

1,938,270

As of March 31, 2018
Liabilities
Current liabilities
Notes and accounts payable-trade
Short-term loans payable
Current portion of bonds payable
Commercial papers
Income taxes payable
Provision for bonuses
Gold payable
Provision for loss on disposal of inventories
Provision for product compensation
Other(Million yen)
As of March 31, 2019

158,369
206,142
25,000–9,151
13,228
246,227783–
118,097

147,566
180,100
–
5,000
7,869
12,872
253,918624
1,435
118,623

777,001

728,01150,000240,292

50,000259,667

986

805

–
37,83336,102
24,162
1,384
51,647
23,162

1,040
40,427
25,61624,0971,623
50,003
33,639465,570

486,921

1,242,571

1,214,933

119,457
92,422
361,430(2,089)119,457
92,393352,932(2,123)571,222562,659

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation adjustment
Remeasurements of defined benefit plans

95,487
1,068
33,071(10,312)(8,066)

51,220124
33,023(5,828)(7,617)

Total accumulated other comprehensive income

111,249

70,922

Total current liabilities
Non-current liabilities
Bonds payable
Long-term loans payable
Provision for loss on business of subsidiaries andassociates
Provision for product compensation
Provision for environmental measures
Deferred tax liabilities
Deferred tax liabilities for land revaluation
Provision for directors’ retirement benefits
Net defined benefit liability
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity

Non-controlling interests

86,02389,754

Total net assets

768,495

723,337

2,011,067

1,938,270

Total liabilities and net assets– 16 –

(2) Consolidated statement of income and consolidated statements of comprehensive income
Consolidated statement of income(Million yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating profit
Interest income
Dividend income
Rent income on non-current assets
Share of profit of entities accounted for using equity
methodOther
Total non-operating profit
Non-operating expenses
Interest expenses
Settlement expenses of remaining business in mines
Rent expenses on non-current assets
Loss on retirement of non-current assets
Share of loss of entities accounted for using equity
methodOther
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Other
Total extraordinary income
Extraordinary losses
Impairment loss
Provision for environmental measures
Loss on valuation of investment securities
Provision for product compensation
Loss on non-conforming products
Other
Total extraordinary losses
Income before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
Net income
Net income attributable to non-controlling interests
Net income attributable to owners of parent

Year Ended March 31, 2018
(Apr. 1, 2017–Mar. 31, 2018)
1,599,533
1,379,877
219,655
146,835
72,819– 17 –

Year Ended March 31, 2019
(Apr. 1, 2018–Mar. 31, 2019)
1,662,990
1,469,911
193,078
156,21736,861812
19,447
4,866

1,254
19,577
5,123

–

3,594

2,657
27,7842,861
32,412

5,058
4,098
2,867
4,494

4,855
3,382
3,043
2,435

1,336

–

3,127
20,982
79,621

4,876
18,59350,679

6,760
5,667
1,752
14,179

5,021
1,596
1,301
7,919

11,035
9,092
400
–
3,202
2,291
26,02367,777
18,941
4,698
23,63944,137
9,542
34,595

8,440
6,630
3,376
2,529
–
1,275
22,25336,345
16,187
12,55028,738
7,606
6,307
1,298

Consolidated statements of comprehensive income(Million yen)
Year Ended March 31, 2018
(Apr. 1, 2017–Mar. 31, 2018)
Net income
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Share of profit of entities accounted for using equity
methodTotal other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to owners ofparentComprehensive income attributable to noncontrolling interests– 18 –

Year Ended March 31, 2019
(Apr. 1, 2018–Mar. 31, 2019)44,137

7,606

40,535490(147)(9,165)
3,578(44,468)(1,141)
–
7,371
392

637

(517)

35,930(38,363)

80,068(30,756)

73,000(39,086)

7,067

8,329

(3) Consolidated statement of changes in equity
Year Ended March 31, 2018 (Apr. 1, 2017–Mar. 31, 2018)(Million yen)
Shareholders’ equity

Capital stock
Balance at beginning of current
periodChanges of items during period
Dividends of surplus
Net income attributable toowners of parent
Reversal of revaluation
reserve for land
Increase associated withchange in accounting periodof consolidated subsidiaries
Increase associated with theincrease in number ofconsolidated subsidiaries
Increase associated with thedecrease in number of equity
method affiliates
Purchase of treasury shares
Disposal of treasury shares
Change in ownership interestof parent due to transactions
with non-controlling interests
Net changes of items otherthan shareholders’ equity

Capital surplus

Retained earnings

92,422

333,526

119,457

Treasury share

Total shareholders’equity(2,017)543,390(9,168)(9,168)34,59534,595

1,711

1,711

83

83

681

681

－
(72)
0

(0)

(72)
0

(0)

–
119,457

Total changes of items during period

Balance at end of current period

(0)

(0)
92,422

27,903
361,430(71)(2,089)27,831
571,222

Accumulated other comprehensive income
Valuation
Deferred
Revaluationdifference on
gains or losses reserve foravailable-foron hedges
landsale securities

Balance at beginning of current
periodChanges of items during period
Dividends of surplus
Net income attributable toowners of parent
Reversal of revaluation
reserve for land
Increase associated withchange in accounting periodof consolidated subsidiaries
Increase associated with theincrease in number ofconsolidated subsidiaries
Increase associated with thedecrease in number of equity
method affiliates
Purchase of treasury shares
Disposal of treasury shares
Change in ownership interestof parent due to transactions
with non-controlling interests
Net changes of items otherthan shareholders’ equity
Total changes of items during period

Balance at end of current period

55,226888

34,930Foreigncurrencytranslation
adjustment(1,418)

Total
NonRemeasureaccumulated controllingments ofother
definedinterests
comprehensive
benefit plansincome(11,735)

77,891

88,913

Total net
assets710,195(9,168)34,595
1,711
83

681

－
(72)
0
(0)
40,260180(1,858)(8,894)

3,669

33,358(2,889)30,46840,26095,487180
1,068(1,858)33,071(8,894)(10,312)

3,669(8,066)33,358111,249(2,889)86,02358,300768,495– 19 –

Year Ended March 31, 2019 (Apr. 1, 2018–Mar. 31, 2019)(Million yen)
Shareholders’ equity

Capital stock
Balance at beginning of current
periodChanges of items during period
Dividends of surplus
Net income attributable toowners of parent
Reversal of revaluation
reserve for land
Increase associated withchange in accounting periodof consolidated subsidiaries
Increase associated with theincrease in number ofconsolidated subsidiaries
Increase associated with thedecrease in number of equity
method affiliates
Purchase of treasury shares
Disposal of treasury shares
Change in ownership interestof parent due to transactions
with non-controlling interests
Net changes of items otherthan shareholders’ equity

Capital surplus

Retained earnings

92,422

361,430

119,457

Treasury share

Total shareholders’equity(2,089)571,222(11,786)(11,786)

1,298

1,298

48

48
－

1,940

1,940

0

0
(36)
1

(0)

(36)
1

(28)

–
119,457

Total changes of items during period

Balance at end of current period

(28)

(29)
92,393(8,498)352,932(34)(2,123)(8,562)562,659

Accumulated other comprehensive income
Valuation
Deferred
Revaluationdifference on
gains or losses reserve foravailable-foron hedges
landsale securities

Balance at beginning of current
periodChanges of items during period
Dividends of surplus
Net income attributable toowners of parent
Reversal of revaluation
reserve for land
Increase associated withchange in accounting periodof consolidated subsidiaries
Increase associated with theincrease in number ofconsolidated subsidiaries
Increase associated with thedecrease in number of equity
method affiliates
Purchase of treasury shares
Disposal of treasury shares
Change in ownership interestof parent due to transactions
with non-controlling interests
Net changes of items otherthan shareholders’ equity
Total changes of items during period

Balance at end of current period

95,487

1,068

33,071

Foreigncurrencytranslation
adjustment(10,312)

Total
NonRemeasureaccumulated controllingments ofother
definedinterests
comprehensive
benefit plansincome(8,066)111,249

86,023

Total net
assets768,495(11,786)
1,298
48
－

1,940

0
(36)
1
(28)
(44,267)

(944)

(48)

4,484

448

(40,326)

3,730(36,595)(44,267)
51,220

(944)
124

(48)
33,023

4,484(5,828)448(7,617)(40,326)
70,922

3,730
89,754(45,158)
723,337– 20 –

(4) Consolidated statement of cash flows
Year Ended March 31, 2018
(Apr. 1, 2017–Mar. 31, 2018)
Cash flow from operating activities
Income before income taxes
Depreciation
Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for loss on business of
subsidiaries and associates
Increase (decrease) in provision for productcompensation
Increase (decrease) in provision for environmental
measures
Increase (decrease) in net defined benefit liability anddirectors' retirement benefits
Interest and dividend income
Interest expenses
Share of (profit) loss of entities accounted for using
equity method
Loss (gain) on sales of property, plant and equipment
Loss on retirement of non-current assets
Impairment loss
Loss on non-conforming products
Loss (gain) on sales of investment securities
Loss (gain) on valuation of investment securities
Decrease (increase) in notes and accounts receivable trade
Decrease (increase) in inventories
Proceeds from sales of gold bullion
Purchase of gold bullion
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 non-current liabilities
Other
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes (paid) refund
Loss on non-conforming products paid
Net cash provided by (used in) operating activities– 21 –(Million yen)
Year Ended March 31, 2019
(Apr. 1, 2018–Mar. 31, 2019)67,77757,025
4,395

36,34559,974
4,544

(187)

128

23

(181)

－

2,475

5,265

2,594

(1,548)(1,392)(20,260)
5,058(20,831)
4,855

1,336

(3,594)(6,368)4,494
11,0353,202(5,064)(736)(4,830)
2,435
8,440
－
(1,596)
3,376(37,337)

13,922(65,635)
119,985(99,460)(20,182)

33,17799,992(99,684)
9,611

34,764(13,707)

2,853
7,010
(3,386)(1,247)62,811
22,043(5,057)(27,365)(1,716)50,715

(896)
9,750
645
(1,692)
143,865
22,771(4,847)(20,135)(1,486)140,168(Million yen)
Year Ended March 31, 2018
(Apr. 1, 2017–Mar. 31, 2018)
Cash flow 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
Purchase of shares of subsidiaries
Proceeds from sales of shares of subsidiaries
Proceeds from liquidation of subsidiaries
Purchase of shares of subsidiaries resulting in change
in scope of consolidation
Proceeds from purchase of shares of subsidiaries
resulting in change in scope of consolidation
Proceeds from sales of shares of subsidiaries resulting
in change in scope of consolidation
Payments for transfer of business
Payments of loans receivableCollection of loans receivable
Other
Net cash provided by (used in) investing activities
Cash flow from financing activities
Net increase (decrease) in short-term loans payable
Proceeds from long-term loans payable
Repayments of long-term loans payable
Proceeds from issuance of bonds
Redemption of bonds
Increase (decrease) in commercial papers
Purchase of treasury shares
Cash dividends paid
Dividends paid to non-controlling interests
Other
Net cash provided by (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
Increase (decrease) in cash and cash equivalents resulting
from change in accounting period of consolidated
subsidiaries
Cash and cash equivalents at end of period– 22 –

Year Ended March 31, 2019
(Apr. 1, 2018–Mar. 31, 2019)(71,494)
10,048(1,431)
(757)
7,168
(863)
0
–

(88,746)
6,396(1,735)(573)
3,000(1,350)285
2,149(38,829)

–

273

–

14,903–(1,541)(6,202)
4,615
154(83,957)–(2,720)992(3,935)(86,238)

20,98147,358(66,251)
20,000(15,000)–(72)(9,168)(6,546)(2,334)(11,034)(17,733)
61,547(52,462)–(25,000)
5,000(36)(11,786)(5,249)(1,893)(47,613)(2,927)

1,375(47,204)
132,616

7,691
87,355

714

4,624

1,228

–

87,35599,672

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 review by the Board of Directors todetermine the allocation of management resources and evaluate business results.
The Company has adopted an internal-company structure, and each internal company and each businessdivision and department carry out their business activities by formulating comprehensive strategies in Japanand overseas for the products and services they handle.
Therefore, the Company consists of segments according to products and services based on the internal
companies and positions four businesses, namely “Advanced Products,” “Metalworking Solutions Business,”“Metals Business,” and “Cement Business” as the reporting segments.
(2) Types of products and services belonging to each reporting segment
The main products in each business are as follows.
(i) Advanced Products
Copper and copper alloy products, electronic materials andcomponents, aluminum products(ii) Metalworking Solutions Business
Cemented carbide products, sintering products(iii) Metals Business
Copper smelting and refining (copper, gold, silver, sulfuric acid, etc.)(iv) Cement Business
Cement, aggregates, ready-mixed concrete, concrete products
2.
Method of calculating the amounts of net sales, income and losses, assets, liabilities and other items
for each reporting segmentFigures for income in the reporting segments are based on ordinary income.
Internal revenues and transfers between segments are based on actual market prices.
3. Matters regarding the change of the reporting segments, among other changes
At the meeting of the Board of Directors held on August 7, 2018, the Company resolved to partially change theorganization of business divisions. This change was made on October 1, 2018.
The Copper & Copper Alloy Products in the Metals Company, the Electronic Materials & Components
Company and the Aluminum Div. are integrated to “Advanced Products Company” as a single in-housecompany, with the aim of strengthen its product planning, marketing and proposal capabilities for key areas andmain customers in a cross-functional manner.
Associated with this, the Company has changed the method of business segmentation from the “Cement
Business,” “Metals Business,” “Advanced Materials & Tools Business,” “Electronic Materials & Components
Business,” “Aluminum Business” and “Others business” to the “Advanced Products,” “Metalworking Solutions
Business,” “Metals Business,” “Cement Business” and “Others business.”
In this regard, the segment information for the previous consolidated fiscal year that is disclosed herein is madeaccording to the changed method of segmentation.

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4. Information relating the amounts of net sales, income and losses, assets, liabilities and other items for eachreporting segment
Year ended March 31, 2018 (from April 1, 2017 to March 31, 2018)(Million yen)Amountreported in
Adjustment
consolidated
amountfinancialstatements

Advanced
Products

Metalworking
Solutions
Business

MetalsBusiness

CementBusiness

OthersBusiness

Total(1) Outside customers

523,071

149,635

542,833

188,612

195,381

1,599,533–(2) Within consolidated group13,012

11,542

172,506

3,766

54,122

254,949(254,949)–

536,083

161,177

715,340

192,378249,503

1,854,482(254,949)

1,599,533

Net sales

Total

1,599,533

Segment income

18,491

16,80825,40021,044

8,312

90,057(10,436)

79,621

Segment assets

597,317217,271585,152

323,857

163,442

1,887,041

124,025

2,011,067

Segment liabilities

463,870

118,309416,668

150,384

106,939

1,256,172(13,601)

1,242,571

Other items
Depreciation

16,232

11,227

11,235

11,533

3,663

53,893

3,131

57,025

Amortization of goodwill

288

1,230

–

2,873

2

4,395

–

4,395

Interest income

407

41

481

80

329

1,340

(527)

812

Interest expenses

2,346

892

1,377

1,233

513

6,364

(1,305)

5,058

Share of profit or loss of entities
accounted for using equity
method

1,355

43

1,305

1,891

(5,940)(1,343)

7(1,336)

Investment in equity method
affiliates

10,974–

5,103

21,5694,948

42,596(152)

42,444

Increase in property, plant andequipment and intangible assets

19,054

16,516

14,451

16,8185,106

71,948

4,283

76,231

Notes: 1. “Others” includes nuclear energy-related services, environmental and recycling-related business, real estatebusiness, and engineering-related services.
2. “Adjustment amount” of segment income of -¥10,436 million includes the elimination of intersegment transactionsof -¥5 million and corporate expenses of -¥10,431 million which are not distributed to the reporting segments.
Corporate expenses consist mainly of general and administrative expenses that do not belong to the reporting
segments, basic experiment and research expenses, and financial revenue and expenses.
3. “Adjustment amount” of segment assets of ¥124,025 million includes the elimination of intersegment transactionsof -¥45,289 million and corporate assets of ¥169,314 million which are not distributed to the reporting segments.
Corporate assets consist mainly of assets pertaining to the administrative divisions that do not belong to thereporting segment and assets for basic experiment and research.
4. “Adjustment amount” of segment liabilities of -¥13,601 million includes the elimination of intersegment
transactions of -¥44,762 million and corporate liabilities of ¥31,161 million which are not distributed to thereporting segments. Corporate liabilities consist mainly of liabilities pertaining to the administrative divisions that
do not belong to the reporting segment and liabilities in basic experiment and research.
5. “Adjustment amount” of the increase in property, plant and equipment and intangible assets of ¥4,283 million
consists mainly of capital expenditure of Central Research Institute.
6. Segment income has been adjusted together with ordinary income on the consolidated statements of income.

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Year ended March 31, 2019 (from April 1, 2018 to March 31, 2019)(Million yen)Amountreported in
Adjustment
consolidated
amountfinancialstatements

Advanced
Products

Metalworking
Solutions
Business

MetalsBusiness

CementBusiness

OthersBusiness

Total(1) Outside customers

557,323

159,632

549,232

195,028

201,772

1,662,990–(2) Within consolidated group

13,666

11,918170,864

3,262

53,947

253,660(253,660)–

570,990

171,551

720,097

198,291

255,720

1,916,650(253,660)

1,662,990

Net sales

Total

1,662,990

Segment income

13,227

15,6092,323

15,447

14,656

61,264(10,584)

50,679Segment assets

531,846

230,636

559,421

329,007

181,327

1,832,239

106,030

1,938,270

Segment liabilities

437,966

126,598

391,460

146,428

107,930

1,210,385

4,548

1,214,933

Other items
Depreciation

17,228

11,381

11,897

12,515

3,270

56,294

3,680

59,974

Amortization of goodwill

434

1,230

–

2,876

2

4,544

–

4,544

Interest income

416

56

852

115

335

1,776

(522)

1,254

Interest expenses

2,197

856

1,803

1,046

299

6,204

(1,348)

4,855

Share of profit or loss of entities
accounted for using equity
method

1,304

–

(577)

2,399

468

3,595

(0)

3,594

Investment in equity method
affiliates

11,697–

3,941

22,9605,265

43,864(150)

43,714

Increase in property, plant andequipment and intangible assets

26,12022,81029,274

16,585

4,081

98,873

4,545

103,418

Notes: 1. “Others” includes nuclear energy-related services, environmental and recycling-related business, real estatebusiness, and engineering-related services.
2. “Adjustment amount” of segment income of -¥10,584 million includes the elimination of intersegment transactionsof ¥81 million and corporate expenses of -¥10,666 million which are not distributed to the reporting segments.
Corporate expenses consist mainly of general and administrative expenses that do not belong to the reporting
segments, basic experiment and research expenses, and financial revenue and expenses.
3. “Adjustment amount” of segment assets of ¥106,030 million includes the elimination of intersegment transactionsof -¥51,667 million and corporate assets of ¥157,698 million which are not distributed to the reporting segments.
Corporate assets consist mainly of assets pertaining to the administrative divisions that do not belong to thereporting segment and assets for basic experiment and research.
4. “Adjustment amount” of segment liabilities of ¥4,548 million includes the elimination of intersegment transactionsof -¥51,808 million and corporate liabilities of ¥56,356 million which are not distributed to the reporting segments.
Corporate liabilities consist mainly of liabilities pertaining to the administrative divisions that do not belong to thereporting segment and liabilities in basic experiment and research.
5. “Adjustment amount” of the increase in property, plant and equipment and intangible assets of ¥4,545 million
consists mainly of capital expenditure of Central Research Institute.
6. Segment income has been adjusted together with ordinary income on the consolidated statements of income.

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[Related information]
Year ended March 31, 2018 (from April 1, 2017 to March 31, 2018)
1. Information by product and service
The note is omitted because the same information is disclosed in the Segment Information.
2. Information by region(1) Net sales
Japan(Million yen)

United States

865,373

144,243

EuropeAsia

52,315

520,350

Other
17,250(2) Property, plant and equipment
Japan

United States

523,681

80,496

Total
1,599,533(Million yen)

Europe

Asia

5,383

34,254

Other
1,742

Total
645,559

1. Categories of country and region are based on geographical proximity.
2. Main countries and regions belonging to categories other than the United States(1) Europe
Germany, the United Kingdom, Spain, France and Finland(2) Asia
Indonesia, Republic of Korea, Malaysia, Singapore, China, Taiwan, Hong Kong and Thailand(3) Other
Australia, Canada and Brazil

3. Information by main customer
The note is omitted because there is no customer who accounts for 10% or more of net sales in the
consolidated statement of income.
Year ended March 31, 2019 (from April 1, 2018 to March 31, 2019)
1. Information by product and service
The note is omitted because the same information is disclosed in the Segment Information.
2. Information by region(1) Net salesJapan
916,687(Million yen)

United States
159,656

EuropeAsia

84,863

480,389

Other
21,394(2) Property, plant and equipment
Japan544,068

United States
83,929Total
1,662,990(Million yen)

Europe

Asia

9,188

48,657

Other
1,570

Total
687,415

1. Categories of country and region are based on geographical proximity.
2. Main countries and regions belonging to categories other than the United States(1) Europe
Germany, the United Kingdom, Spain, France and Finland(2) Asia
Indonesia, Republic of Korea, Malaysia, Singapore, China, Taiwan, Hong Kong and Thailand(3) Other
Australia, Canada and Brazil

3. Information by main customer
The note is omitted because there is no customer who accounts for 10% or more of net sales in the
consolidated statement of income.

– 26 –

[Information relating to impairment losses of non-current assets by reporting segment]
Year ended March 31, 2018 (from April 1, 2017 to March 31, 2018)(Million yen)
Metalworking
Solutions
Business

Advanced
Products
Impairment loss

6,047

MetalsBusiness

CementBusiness–

4,785

OthersBusiness

31

Total

165

Corporate or
elimination

Grand total

6

11,035

11,029(Note) Adjustment of impairment loss of ¥6 million consists mainly of the impairment loss of idle assets.

Year ended March 31, 2019 (from April 1, 2018 to March 31, 2019)(Million yen)
Metalworking
Solutions
Business

Advanced
Products
Impairment loss

2,445

5,547

MetalsBusiness

CementBusiness–

OthersBusiness

232

Total

66

Corporate or
elimination

Grand total

148

8,440

8,291

(Note) Adjustment of impairment loss of ¥148 million consists mainly of the impairment loss of idle assets.

[Information relating to amortization and unamortized balance of goodwill by reporting segment]
Year ended March 31, 2018 (from April 1, 2017 to March 31, 2018)(Million yen)
Advanced
Products

Metalworking
Solutions
Business

MetalsBusiness

CementBusiness

OthersBusiness

Amortization in thefiscal year ended March
31, 2018

288

1,230

–

2,873

2

Unamortized balance atthe end of the fiscal year
ended March 31, 2018

8,697

8,525

–

27,405

7

Corporate or
elimination

Grand total

4,395

–

4,395

44,636–44,636Total

The amortization and the unamortized balance of negative goodwill arising from business combination, etc.
conducted before April 1, 2010 are as follows.
(Million yen)
Advanced
Products

Metalworking
Solutions
Business

MetalsBusiness

CementBusiness

OthersBusiness

Amortization in thefiscal year ended March
31, 2018

–

–

–

–

–

Unamortized balance atthe end of the fiscal year
ended March 31, 2018

2,221

–

–

–

–

Corporate or
elimination

Grand total

–

–

–

2,221

–

2,221

Total

Year ended March 31, 2019 (from April 1, 2018 to March 31, 2019)(Million yen)
Advanced
Products

Metalworking
Solutions
Business

MetalsBusiness

CementBusiness

OthersBusiness

Amortization in thefiscal year ended March
31, 2019

434

1,230

–

2,876

2

Unamortized balance atthe end of the fiscal year
ended March 31, 2019

7,762

7,302

–

25,7464– 27 –

Corporate or
elimination

Grand total

4,544

–

4,544

40,816–40,816Total

The amortization and the unamortized balance of negative goodwill arising from business combination, etc.
conducted before April 1, 2010 are as follows.
(Million yen)
Advanced
Products

Metalworking
Solutions
Business

MetalsBusiness

CementBusiness

OthersBusiness

Amortization in thefiscal year ended March
31, 2019

–

–

–

–

–

Unamortized balance atthe end of the fiscal year
ended March 31, 2019

2,221

–

–

–

–

Corporate or
elimination

Grand total

–

–

–

2,221

–

2,221

Total

Per-share Information

Net assets per share
Net income per share

Year ended March 31, 2018(from April 1, 2017
to March 31, 2018)
5,211.20 yen
264.15 yen

Year ended March 31, 2019(from April 1, 2018
to March 31, 2019)
4,838.31 yen
9.92 yen(Notes) 1. Diluted net income per share is not stated because there are no dilutive shares.
2. The basis for the calculation of net income per share is as follows.
Year ended March 31, 2018Year ended March 31, 2019(from April 1, 2017(from April 1, 2018
to March 31, 2018)
to March 31, 2019)
Net income per share
Net income attributable to owners of parent
34,595
1,298(million yen)Amount not attributable to ordinary shareholders––(million yen)
Net income attributable to owners of parent
34,595
1,298
pertaining to common stock (million yen)
Average number of shares issued during terms
130,972
130,956(thousand shares)– 28 –

Important Subsequent Events(Change of segmentation)
At the meeting of the Board of Directors held on February 12, 2019, the Company resolved to partially change
the organization of business division. This change was made on April 1, 2019.
The coal-related business in the “Others business” changed to the “Cement Business,” in which coal is used asthermal energy, to achieve more efficient business management.
Information on net sales, income and losses, assets and liabilities and other items for each reporting segment in
the consolidated fiscal year under review based on the new segments is as follows.
Year ended March 31, 2019 (from April 1, 2018 to March 31, 2019)
Information relating the amounts of net sales, income and losses, assets, liabilities and other items for eachreporting segment(Million yen)Amountreported in
Adjustment
consolidated
amountfinancialstatements

Advanced
Products

Metalworking
Solutions
Business

MetalsBusiness

CementBusiness

OthersBusiness

Total(1) Outside customers

557,323

159,632

549,232

249,552

147,249

1,662,990–(2) Within consolidated group

13,666

11,918170,864

4,098

47,515

248,064(248,064)–

570,990

171,551

720,097

253,650

194,764

1,911,055(248,064)

1,662,990

Net sales

Total

1,662,990

Segment income

13,227

15,6092,323

19,725

10,37861,264(10,584)

50,679Segment assets

531,846

230,636

559,421368,081

142,254

1,832,239

106,030

1,938,270

Segment liabilities

437,966

126,598

391,460

132,014122,344

1,210,385

4,548

1,214,933

Other items
Depreciation

17,228

11,381

11,897

12,7083,077

56,294

3,680

59,974

Amortization of goodwill

434

1,230

–

2,876

2

4,544

–

4,544

Interest income

416

56

852

161

289

1,776

(522)

1,254

Interest expenses

2,197

856

1,803

1,193

152

6,204

(1,348)

4,855

Share of profit or loss of entities
accounted for using equity
method

1,304

–

(577)

2,399

468

3,595

(0)

3,594

Investment in equity method
affiliates

11,697–

3,941

22,9605,265

43,864(150)

43,714

Increase in property, plant andequipment and intangible assets

26,12022,81029,274

16,972

3,694

98,873

4,545

103,418

Notes: 1. “Others” includes nuclear energy-related services, environmental and recycling-related business, real estatebusiness, and engineering-related services.
2. “Adjustment amount” of segment income of -¥10,584 million includes the elimination of intersegment transactionsof ¥81 million and corporate expenses of -¥10,666 million which are not distributed to the reporting segments.
Corporate expenses consist mainly of general and administrative expenses that do not belong to the reporting
segments, basic experiment and research expenses, and financial revenue and expenses.
3. “Adjustment amount” of segment assets of ¥106,030 million includes the elimination of intersegment transactionsof -¥51,667 million and corporate assets of ¥157,698 million which are not distributed to the reporting segments.
Corporate assets consist mainly of assets pertaining to the administrative divisions that do not belong to thereporting segment and assets for basic experiment and research.
4. “Adjustment amount” of segment liabilities of ¥4,548 million includes the elimination of intersegment transactionsof -¥51,808 million and corporate liabilities of ¥56,356 million which are not distributed to the reporting segments.
Corporate liabilities consist mainly of liabilities pertaining to the administrative divisions that do not belong to thereporting segment and liabilities in basic experiment and research.
5. “Adjustment amount” of the increase in property, plant and equipment and intangible assets of ¥4,545 million
consists mainly of capital expenditure of Central Research Institute.
6. Segment income has been adjusted together with ordinary income on the consolidated statements of income.

– 29 –