Consolidated Financial Results for the Nine Months Ended December 31, 2016
(Japanese Accounting Standards)
February 9, 2017
Name of Listed Company: Mitsubishi Materials Corporation
Listing:
Tokyo Stock Exchange
Stock Code:
5711
URL:
http://www.mmc.co.jp/
Representative: Akira Takeuchi, President
Contact:
Naoya Sasaki, Manager, Corporate Communications & IR Dept.
Tel: +81-3-5252-5206
Scheduled filing date of Quarterly Report:
February 9, 2017
Scheduled date of start of dividend payment:―
Supplementary materials for the quarterly financial results: Yes
Investor conference for the quarterly financial results:
Yes (For Institutional Investors)(Amounts of less than million yen are omitted.)

1. Results of the first nine months ended December 31, 2016 (From April 1, 2016 to December 31, 2016)(1) Results of Operations (cumulative)(Figures in percentages denote the year-on-year change.)
Net salesFirst nine months ended December 31,
2016
First nine months ended December 31,
2015(Note) Comprehensive income:Operating profit

Net income
attributable toowners of parent

Ordinary income

Million yen%

Million yen%

Million yen%

Million yen%

956,344-9.4

43,892-15.9

52,977-4.5

49,393-12.7

1,055,860-6.7

52,220-0.8

55,471-16.1

56,553

40.5

Nine months ended December 31, 2016: 46,787 million yen (-3.9%)
Nine months ended December 31, 2015: 48,682 million yen (-33.4%)

Net income
per share

Diluted net income
per share
YenFirst nine months ended December 31,
2016
First nine months ended December 31,
2015

Yen

377.06–431.67–* The Company consolidated its shares at a 10:1 ratio of its common stock, with an effective date of October 1, 2016. Accordingly, net income pershare is calculated on the assumption that the consolidation of its shares was conducted at the beginning of the previous consolidated fiscal year.

(2) Financial Position
Total assets

As of December 31, 2016
As of March 31, 2016
(Reference) Shareholders’ Equity:

Shareholders’equity ratio

Net assets

Million yen

Million yen%

1,837,743
1,793,375

678,047
645,017

32.2
31.0

As of December 31, 2016: 592,360 million yen

As of March 31, 2016: 555,227 million yen

2. Dividend Payments
Dividends per share(Record date)

First quarter
Yen

Second quarter

Third quarter

Yen

Yen

Year ended March 31, 2016

–

5.00

–

Year ending March 31, 2017

–

2.00

–

Year ending March 31, 2017 (Forecast)Year-end

Annual
Yen

Yen

5.00

10.00

40.00

–

(Note) Revision of dividend forecast published most recently: None
* The Company consolidated its shares at a 10:1 ratio of its common stock, with an effective date of October 1, 2016. For the amount of dividends atthe end of the second quarter of the fiscal year ended March 31, 2017, the amount prior to the consolidation of shares is stated because the dividends
were paid based on the number of shares before the consolidation of shares.
For the year-end dividend per share in the fiscal year ending March 31, 2017 (forecast), the amount after the consolidation of shares is stated and ahyphen is written for the annual dividend because it cannot be simply combined.

3. Forecast (From April 1, 2016 to March 31, 2017)(Figures in percentages denote the year-on-year change.)

Net salesYear ending March 31,
2017

Operating profit

Ordinary income

Net income
attributable toowners of parent

Net income
per share

Million yen%

Million yen%

Million yen%

Million yen%

Yen

1,300,000-8.3

59,000-16.2

64,000-11.7

24,000-60.9183.24(Note) Revision to forecast published most recently: Yes* The Company consolidated its shares at a 10:1 ratio of its common stock, with an effective date of October 1, 2016. Accordingly, net income pershare is calculated on the assumption that the consolidation of its shares was conducted at the beginning of the current consolidated fiscal year.

* 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) Application of specific accounting treatment:

Yes(Note) For details, please see “(1) Application of special accounting treatment in the preparation of the quarterly consolidated
financial statements” under “2. Matters Related to Summary Information (Notes)” on page 6.

(3) 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:

Yes
None
None
None

(Note) For details, please see “(2) Changes in accounting policies, changes of accounting estimates and restatement” under “2.
Matters Related to Summary Information (Notes)” on page 6.

(4) Numbers of issued shares (common stock)(i)
Numbers of issued shares at end of terms (including treasury shares):
Nine months ended December 31, 2016: 131,489,535 sharesYear ended March 31, 2016:
131,489,535 shares(ii)
Numbers of treasury shares at end of terms:
Nine months ended December 31, 2016:
502,567 sharesYear ended March 31, 2016:
488,618 shares(iii) Average number of shares issued during terms (quarterly cumulative period):
Nine months ended December 31, 2016: 130,995,924 shares
Nine months ended December 31, 2015: 131,012,715 shares* The Company consolidated its shares at a rate of one share for every 10 shares of its common stock, with October 1, 2016 as
the effective date. Subsequently, the number of issued shares at the end of the term, the number of treasury shares at the end of
the term, and the average number of shares issued during the term are calculated based on the assumption that the consolidationof shares was conducted at the beginning of the previous consolidated fiscal year.

* Indication regarding the status of a quarterly review
This financial summary for the nine months ended December 31, 2016 is not subject to a quarterly review under the
Financial Instruments and Exchange Law. The review of the quarterly consolidated financial statements under the
aforementioned act is in progress at the time of the announcement of this financial summary.
* 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 not constitute an assurance that the Company promises to achieve these projected results. Therefore,
readers are advised to note that the actual results may vary materially from the forecasts due to a variety of factors.
Please see “(3) Information on the consolidated earnings forecasts and other future forecasts” of “1. Qualitative
Information on Financial Results for the Nine Months Ended December 31, 2016” on page 4 for the assumptions about
consolidated earnings forecasts.
(Operating Results Forecast after the Consolidation of Shares)
The consolidation of shares and the revisions in the number of shares constituting one share unit of the Company werepassed and approved at the 91st Ordinary General Meeting of Shareholders held on June 29, 2016, and the Company
consolidated the shares at a 10:1 ratio of its common stock and changed the number of shares constituting one share unit
from 1,000 to 100 shares with effective date of October 1, 2016. Accordingly, net income per share is calculated on theassumption that the consolidation of its shares was conducted at the beginning of the current consolidated fiscal year.
(Procedure for obtaining supplementary information on quarterly financial results and quarterly financial briefing)
Mitsubishi Materials Corporation plans to hold a quarterly financial briefing for institutional investors on Thursday,
February 9, 2017. The materials used at this briefing are disclosed on the TDnet and the Company’s web page at thetime that the quarterly financial results are announced.

Contents

1. Qualitative Information on Financial Results for the Nine Months Ended December 31, 2016 ......... 2(1) Details of operating results .................................................................................................................... 2(2) Details of financial position ................................................................................................................... 4(3) Information on the consolidated earnings forecasts and other future forecasts ..................................... 4
2. Matters Related to Summary Information (Notes) .............................................................................. 6(1) Application of special accounting treatment in the preparation of the quarterly consolidated financial
statements ............................................................................................................................................. 6(2) Changes in accounting policies, changes of accounting estimates and restatement .............................. 6(3) Additional information .......................................................................................................................... 6(4) Contingent liabilities.............................................................................................................................. 8
3. Consolidated Financial Statements...................................................................................................... 9(1) Consolidated balance sheet .................................................................................................................... 9(2) Consolidated statement of income and consolidated statements of comprehensive income ............... 11
Consolidated statement of income .............................................................................................. 11
Consolidated statements of comprehensive income .................................................................... 12(3) Notes to consolidated quarterly financial statements .......................................................................... 13
Notes on assumptions for a going concern .................................................................................. 13
Segment information ................................................................................................................... 13
Notes on significant changes in the amount of Shareholders’ equity, if any .............................. 14–1–

1. Qualitative Information on Financial Results for the Nine Months Ended December 31, 2016
(1) Details of operating results1) Overview of operating results
During the first nine months of the consolidated fiscal year under review, there was an economic slowdown
in China, Thailand and Indonesia, among other countries in Asia. In the United States, while the economy
continued to grow moderately, the pace of growth tended to slow.
In the Japanese economy, employment and income conditions were on the road to recovery. However, public
investments grew at a sluggish pace, and the improvement in capital expenditure and corporate earnings
came to a temporary standstill.
Regarding the business environment for the Mitsubishi Materials Group, foreign exchange markets werecharacterized by year-on-year yen appreciation, and the Group was affected by such factors as a decrease incopper prices and a fall in overall demand for cement in Japan.
Under these circumstances, consolidated net sales for the first nine months of the year under review totaled¥956,344 million, down 9.4% year on year. Operating profit declined 15.9% year on year, to ¥43,892 million,
and ordinary income decreased 4.5%, to ¥52,977 million. Net income attributable to owners of parent was¥49,393 million, down 12.7% year on year.
2) Overview by segments(Cement)

Net sales
Operating profit
Ordinary income

FY 2016 Q1-Q3
147.2
16.0
15.7

FY 2017 Q1-Q3
132.3
16.4
16.3

(Billion yen)
Increase / Decrease (%)-14.9(-10.1%)
0.4(2.5%)
0.5(3.7%)In the Cement business, the sales volume decreased in Japan because of a decline in demand throughout themarket, chiefly reflecting a delay in construction work mainly due to labor shortages and sluggish growth indemand in the public and the private sectors. In the United States, the sales volume of ready-mixed concrete
increased, reflecting strong sales related to housing and commercial properties. The sales volume of cement
also increased, thanks to the rise in sales volume of ready-mixed concrete. In China, the sales volume
declined due to restrictions on production activities at cement factory, etc. as a countermeasure against severe
air pollution. In the overall Cement business, cement production amounted to 8.8 million tons, unchanged
from the level a year ago.
As a result, net sales decreased and operating profit increased year on year for the entire Cement business.
Ordinary income also increased because of the rise in operating profit.
(Metals)

Net sales
Operating profit
Ordinary income

FY 2016 Q1-Q3
511.8
17.4
19.0

FY 2017 Q1-Q3
459.6
12.4
22.9

(Billion yen)
Increase / Decrease (%)-52.1(-10.2%)-4.9(-28.4%)
3.9(20.6%)In the copper business, net sales and operating profit declined, primarily reflecting a fall in copper prices,
despite the return to ordinary operations at PT. Smelting in Indonesia, which was temporarily suspended–2–during the same period as the previous fiscal year due to equipment issues. Copper cathode production for theentire Metals business amounted to 426 thousand tons, up 55 thousand tons from the previous corresponding
period.
In the gold and other valuable metals business, both net sales and operating profit increased, mainly thanks tothe production hike, reflecting a rise in the contained amount in ore.
In the copper and copper alloy products business, net sales declined while operating profit increased mainly
due to a fall in copper prices, despite an increase in the sales of products for automobiles, semiconductors,
and other uses.
As a result, the entire Metals business posted year-on-year decreases in net sales and operating profit.
Ordinary income for the segment increased because of the increases in dividend income and equity inearnings of affiliates.
(Advanced Materials & Tools)

Net sales
Operating profit
Ordinary income

FY 2016 Q1-Q3
115.3
12.8
12.2

FY 2017 Q1-Q3
106.1
8.2
7.2

(Billion yen)
Increase / Decrease (%)-9.1(-8.0%)-4.5(-35.4%)-4.9(-40.6%)In the cemented carbide products business, net sales and operating profit declined due to the deteriorating
market conditions primarily attributable to the slowdown in the Chinese economy. Another contributing
factor was the effect of the yen appreciation compared with the exchange rate in the same period of theprevious fiscal year.
In the high-performance alloy products business, sales of products for automobiles remained firm in North
America, but lower sales in Japan caused net sales and operating profit to decline.
As a result, the overall Advanced Materials & Tools business recorded year-on-year decreases in net sales
and operating profit. Ordinary income declined due to the decrease in operating profit and recorded exchange
losses.
(Electronic Materials & Components)

Net sales
Operating profit
Ordinary income

FY 2016 Q1-Q3
52.9
2.5
5.2

FY 2017 Q1-Q3
46.4
1.3
1.4

(Billion yen)
Increase / Decrease (%)-6.5(-12.3%)-1.1(-46.7%)-3.7(-72.2%)In the advanced materials and chemical products business, net sales decreased while operating profit
increased because sales of products related to semiconductor manufacturing equipment and chemical
products for hybrid vehicles remained strong, although sales of products for LSIs for smartphones and power
modules were down.
In the electronic components business, net sales increased while operating profit declined, reflecting a lower
volume of sales of products for information and telecommunications equipment, as well as the yen
appreciation compared with the same period of the previous fiscal year, despite a solid performance sales of
products for home appliances and optical communication related equipment.
The polycrystalline silicon business recorded a decline in net sales and operating profit due to a fall in sales.

–3–As a result, the entire Electronic Materials & Components business registered year-on-year declines in net
sales and operating profit. Ordinary income dropped as a result of decreases in operating profit and equity inearnings of affiliates.
(Aluminum)

Net sales
Operating profit
Ordinary income

FY 2016 Q1-Q3
122.4
4.1
3.7

FY 2017 Q1-Q3
120.4
7.6
7.6

(Billion yen)
Increase / Decrease (%)-1.9(-1.6%)
3.5(83.7%)
3.8(103.3%)In the aluminum can business, demand for bottle cans increased, and raw material costs declined.
In the rolled aluminum and processed aluminum products business, demand of products for solar cells
declined, while demand of products for automobiles increased. While sales price declined due to fallingmarket metal prices.
As a result, the entire Aluminum business posted a decrease in net sales and an increase in operating profit
year on year. Ordinary income increased due to the rise in operating profit.
(Others)

Net sales
Operating profit
Ordinary income

FY 2016 Q1-Q3
172.6
4.8
5.5

FY 2017 Q1-Q3
148.7
4.8
4.6

(Billion yen)
Increase / Decrease (%)-23.9(-13.8%)-0.0(-0.5%)-0.8(-15.8%)In the energy-related business, net sales declined, but operating profit increased thanks to a rise in electricity
sales volume because hydroelectric power plants, which were being renewed during the previous
corresponding period, returned to ordinary operation, while sales of coal declined.
In the “E-waste” (used electronics and electrical products) recycling business, net sales and operating profit
declined, reflecting lower sales due to the falling unit price of valuables.
Orders received for nuclear energy and engineering-related services amounted to ¥62.0 billion, up ¥17.1
billion year on year. The order backlog at the end of the period was ¥46.6 billion, up ¥12.3 billion from ayear earlier.
(2) Details of financial position
Total assets at the end of the third quarter of the consolidated fiscal year under review stood at ¥1,837.7 billion,up ¥44.3 billion from the end of the previous consolidated fiscal year. This result was mainly due to an increase
in inventory.
Total liabilities were ¥1,159.6 billion, an increase of ¥11.3 billion from the end of the previous consolidated
fiscal year. This was mainly due to an increase in notes and accounts receivable-trade.
(3) Information on the consolidated earnings forecasts and other future forecasts
We have revised the figures in our consolidated earnings forecasts for the fiscal year ending March 31, 2017,
which were previously announced (on November 9, 2016).

–4–

In the consolidated earnings forecasts for the fiscal year ending March 31, 2017, net sales are expected to exceed
the previous forecast, while operating income is set to be lower than the previous forecast, given that theoperation of PT. Smelting in Indonesia has been temporarily suspended and the sales volume of cemented
carbide products remains lower than planned in the Advanced Materials & Tools business, while copper prices
continue to rise. Both ordinary income and net income attributable to owners of parent are likely to exceed theprevious forecasts, primarily because the increase in dividend income was greater than expected.

Net sales
Operating profit
Ordinary income
Net income attributable toowners of parent

Previous forecast
1,280.0
61.0
61.0

Current forecast
1,300.0
59.0
64.0

22.0

24.0

–5–

(Billion yen)
Increase / Decrease (%)
1.5%
-3.2%
4.9%
9.0%

2. Matters Related to Summary Information (Notes)(1) Application of special accounting treatment in the preparation of the quarterly consolidated
financial statements
The Company calculates tax expenses by rationally assuming an effective tax rate after applying the tax effectaccounting to income before income taxes for the consolidated fiscal year, including the third quarter underreview, and multiplying income before income taxes for the first nine months of the consolidated fiscal year
under review by the estimated effective tax rate.

(2) Changes in accounting policies, changes of accounting estimates and restatement
Changes in accounting policies(Application of Practical Solution on a Change in Depreciation Method due to Tax Reform 2016)
In association with the revision of the Corporation Tax Act, the Company has applied the “Practical Solution ona change in depreciation method due to Tax Reform 2016” (ASBJ Practical Issues Task Force (PITF) No. 32
dated June 17, 2016) from the first quarter of the consolidated fiscal year under review. It also changed thedepreciation method for facilities attached to buildings and structures that were acquired on or after April 1,
2016, switching from the declining-balance method to the straight-line method.
The impact of this change on profits and losses for the first nine months of the consolidated fiscal year underreview is minor.

(3) Additional information(Provision for environmental measures)
In regards to expenses for specific countermeasure work to prevent mining-induced pollution and expenses forcountermeasure work to stabilize collection sites in abandoned and suspended mines managed by the Group, we
have recorded a provision for the expenses whose estimated amount has been fixed because the details of theconstruction work have been determined, and have included it in the “provision” under “non-current liabilities”.
However, there are some forms of countermeasure work for which the amount cannot be calculated reasonably
because the details of construction work are undecided due to the fact that the most appropriate construction
method for the landscape and existing equipment have yet to be selected, even though specific countermeasure
work is necessary.
(Application of implementation guidance on recoverability of deferred tax assets)
The Company has applied the “Implementation Guidance on Recoverability of Deferred Tax Assets” (ASBJ
Guidance No. 26 dated March 28, 2016) from the first quarter of the consolidated fiscal year under review.
(Business Combination by Acquisition Method)
The Company signed a share transfer agreement dated September 28, 2016, with Luvata Espoo Oy and its two
subsidiaries, for the acquisition of the Special Products Division (“Luvata SP”) of the Luvata Group throughequity acquisition and business transfer.
Overview of the business combination(i) The acquired company and the description and size of its business
Acquired company:
14 companies belonging to Luvata SP
Business: Manufacture and sale of copper processed products
Net Sales: Approximately 78.0 billion yen (approximate amount of consolidated net sales recorded by
Luvata SP in the fiscal year ended December 31, 2015)(ii) Main reason for the business combination–6–

The purpose of the business combination is to accelerate the global expansion of the Copper & Copper
Alloy Products business of the Company by pursuing various synergies though the business and customer
bases of the Special Products Division of Luvata and to lead it to the establishment of a high-profitablebusiness structure(iii) Date of the business combination
This transaction will be implemented without delay upon the completion of acquisition, etc. of approval andauthorization pursuant to the laws and regulations required for its implementation, which is scheduled forthe period between the fourth quarter of fiscal year 2017 and the first quarter of fiscal year 2018.
(iv) Legal form of the business combination
Acquisition of shares and business transfer in exchange for cash and deposits.
(v) Name of the companies after the business combination
No change(vi) Percentage of voting rights to acquire
100%

–7–

(4) Contingent liabilities
Previous consolidated fiscal year (As of March 31, 2016)
On December 30, 2014, PT. Smelting in Indonesia, a consolidated subsidiary of the Company (hereinafter the“Consolidated Subsidiary”), received a notice of reassessment in an amount of US$47 million (¥5,393 million
based on the exchange rate at the end of the previous consolidated fiscal year) from the Indonesian National Tax
Authority regarding the sales transaction pricing of the Consolidated Subsidiary for the year ended December
2009. On January 28, 2015, the Consolidated Subsidiary made a provisional deposit of US$14 million (¥1,577
million) as a part of the additional collection.
However, the Consolidated Subsidiary submitted a written objection to the Indonesian National Tax Authority
on March 25, 2015, because this assessment, which claimed there was a sales shortage on the part of theConsolidated Subsidiary based on a comparison of the profit margin ratio with other companies selected by theIndonesian National Tax Authority, was highly unreasonable and found to be unacceptable by the Company andthe Consolidated Subsidiary.
The written objection submitted by the Consolidated Subsidiary on March 25, 2015 was dismissed by theIndonesian National Tax Authority on March 16, 2016. Therefore, the Consolidated Subsidiary filed a complaint
to the Tax Court in Indonesia on June 6, 2016 to present the fairness of the view of the Company and theConsolidated Subsidiary.
Third quarter of the consolidated fiscal year under review (As of December 31, 2016)
On December 30, 2014, PT. Smelting in Indonesia, a consolidated subsidiary of the Company (hereinafter the“Consolidated Subsidiary”), received a notice of reassessment in an amount of US$47 million (¥5,576 million
based on the exchange rate at the end of the third quarter of the consolidated fiscal year under review) from theIndonesian National Tax Authority regarding the sales transaction pricing of the Consolidated Subsidiary for theyear ended December 2009. On January 28, 2015, the Consolidated Subsidiary made a provisional deposit of
US$14 million (¥1,630 million) as a part of the additional collection.
However, the Consolidated Subsidiary submitted a written objection to Indonesian National Tax Authority on
March 25, 2015, because this assessment, which claimed there was a sales shortage on the part of theConsolidated Subsidiary based on a comparison of the profit margin ratio with other companies selected by theIndonesian National Tax Authority, was highly unreasonable and found to be unacceptable by the Company andthe Consolidated Subsidiary.
The written objection submitted by the Consolidated Subsidiary on March 25, 2015 was dismissed by theIndonesian National Tax Authority on March 16, 2016. Therefore, the Consolidated Subsidiary filed a complaint
to the Tax Court in Indonesia on June 6, 2016 to present the fairness of the view of the Company and theConsolidated Subsidiary.
On December 22, 2016, the Consolidated Subsidiary also received a notice of reassessment in an amount of
US$34 million (¥3,988 million) from the Indonesian National Tax Authority regarding its posting of raw
material costs for the fiscal year ended December 31, 2011.
However, this assessment from the Indonesian National Tax Authority is based on its view of unilaterally
negating the basis for recording raw material costs, etc. of the Consolidated Subsidiary and found to beunacceptable by the Company and the Consolidated Subsidiary. Therefore, the Consolidated Subsidiary has
decided to submit a written objection to the Authority in the future.

–8–

3. Consolidated Financial Statements(1) Consolidated balance sheet
As of March 31, 2016
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade
Merchandise and finished goods
Work in process
Raw materials and supplies
OthersAllowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Machinery and equipment, net
Land, net
Other, net
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
OthersAllowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets–9–(Million yen)
As of December 31, 2016

60,123233,09385,082
83,69489,875
232,817(2,155)89,401
223,254
85,730116,185
98,549232,440(2,561)

782,530

843,001

196,085
268,634
205,517

196,484
257,325
203,614670,237

657,424

48,986
17,032

39,917
15,86066,01955,777

212,606
68,052(6,070)224,106
63,032(5,599)274,588281,539

1,010,845

994,742

1,793,375

1,837,743

As of March 31, 2016
Liabilities
Current liabilities
Notes and accounts payable-trade
Short-term loans payable
Current portion of bonds payable
Income taxes payable
Provision
Gold payable
Other(Million yen)
As of December 31, 2016

110,596
200,527
25,1007,037
13,740231,667
107,649

132,652
193,480
15,00012,0307,513
234,637
103,172

Total current liabilities

696,319

698,487

Non-current liabilities
Bonds payable
Long-term loans payable
Provision
Net defined benefit liability
Other

40,000260,681
16,74663,54471,06655,000261,850
12,17861,13071,049452,038

461,208

1,148,358

1,159,696

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

119,457
92,422
345,489(1,997)

512,797555,372

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

21,645(199)
34,282
3,647(16,946)

35,083(4,490)32,184(11,438)(14,351)

Total accumulated other comprehensive income

42,43036,987

Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity

Non-controlling interests

89,78985,686

Total net assets

645,017

678,047

1,793,375

1,837,743

Total liabilities and net assets– 10 –

(2) Consolidated statement of income and consolidated statements of comprehensive income
Consolidated statement of income
Consolidated first nine months

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating profit
Interest income
Dividend income
Equity in earnings of affiliates
Rent income on non-current assets
Other
Total non-operating profit
Non-operating expenses
Interest expenses
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Gain on change in equity
Gain on redemption of investment securities
Other
Total extraordinary income
Extraordinary losses
Loss on valuation of investment securities
Subsidiary transfer cost
Provision for environmental measures
Loss on suspension of operations
Other
Total extraordinary losses
Income before income taxes
Income taxes
Net income
Net income attributable to non-controlling interests
Net income attributable to owners of parent(Million yen)
Nine Months Ended
December 31, 2015
(Apr. 1, 2015–Dec 31, 2015)
1,055,860
896,143
159,717
107,496
52,220– 11 –

Nine Months Ended
December 31, 2016
(Apr. 1, 2016–Dec. 31, 2016)
956,344807,859
148,484
104,591
43,892

443
7,046
4,157
3,770
3,432
18,850405
14,368
1,867
3,661
1,577
21,8795,184
10,416
15,60055,471

3,812
8,981
12,79352,977

6,281
19,187
10,464
1,234
4,210
41,37816,039
3,169
–
–
470
19,6802–
10,841
2,661
2,684
16,19180,657
20,99959,6583,104
56,553

109
107
–
–
295
512
72,145
17,45454,6905,296
49,393

Consolidated statements of comprehensive income
Consolidated first nine months(Million yen)
Nine Months Ended
December 31, 2015
(Apr. 1, 2015–Dec 31, 2015)

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
Equity in earnings of affiliates
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to owners ofparentComprehensive income attributable tonon-controlling interests– 12 –

Nine Months Ended
December 31, 2016
(Apr. 1, 2016–Dec. 31, 2016)

59,65854,690(8,217)2,046
59(2,696)
1,124(3,292)

13,472(4,941)–(15,752)
2,618(3,299)(10,975)(7,902)

48,682

46,78745,661

46,191

3,021

596

(3) Notes to consolidated quarterly financial statements
Notes on assumptions for a going concern
N/A

Segment information[Segment Information]
I. For the nine months ended December 31, 2015 (from April 1, 2015 to December 31, 2015)
1. Sales and income of reporting segments(Million yen)

AdvancedElectronic
Materials & Materials & Aluminum
Tools
Components

CementMetals(1) Outside customers

144,652

505,467

101,240

42,554(2) Withinconsolidated group

2,573

6,344

14,101

10,373

Total

147,225

511,811

115,341

15,792

19,015

12,215

Amountindicated intheAdjustment
consolidated
amountquarterlystatements
of income

OthersTotal

121,123

140,822

1,055,860–

1,055,860

1,280

31,79066,463(66,463)–

52,927

122,404

172,613

1,122,323(66,463)

1,055,860

5,243

3,748

5,550

61,566(6,095)55,471

Net sales

Segment income

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 -¥6,095 million includes the elimination of intersegment transactionsof -¥13 million and corporate expenses of -¥6,081 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. Segment income has been adjusted together with ordinary income on the consolidated quarterly statements ofincome.

II. For the nine months ended December 31, 2016 (from April 1, 2016 to December 31, 2016)
1. Sales and income of reporting segments(Million yen)

AdvancedElectronic
Materials & Materials & Aluminum
Tools
Components

CementMetals(1) Outside customers

129,989

453,958

94,39541,727(2) Withinconsolidated group

2,334

5,695

11,747

Total

132,323459,654

16,38022,938Amountindicated intheAdjustment
consolidated
amountquarterlystatements
of income

OthersTotal

118,805

117,467

956,344–956,344

4,673

1,621

31,24257,315(57,315)–

106,143

46,400120,427

148,709

1,013,659(57,315)

956,344

7,259

1,459

7,619

4,674

60,332(7,354)

52,977

Net sales

Segment income

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 -¥7,354 million includes the elimination of intersegment transactionsof ¥21 million and corporate expenses of -¥7,376 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. Segment income has been adjusted together with ordinary income on the consolidated quarterly statements ofincome.

– 13 –

2. Matters relating to the change in the reporting segments, etc.
(Application of Practical Solution on a change in depreciation method due to Tax Reform 2016)
As stated in “Changes in accounting policies,” the Company has applied the “Practical Solution on a change indepreciation method due to Tax Reform 2016” from the first quarter of this consolidated fiscal year. It alsochanged the depreciation method for facilities attached to buildings and structures that were acquired on or after
April 1, 2016, switching from the declining-balance method to the straight-line method.
The impact of this change on segment income for the first nine months of the consolidated fiscal year underreview is minor.

Notes on significant changes in the amount of Shareholders’ equity, if any
N/A– 14 –