Flash Report
Consolidated Basis
Results for Fiscal 2017
(April 1, 2017―March 31, 2018)＜under Japanese GAAP＞
April 26, 2018
Nippon Steel & Sumitomo Metal Corporation
Tokyo, Nagoya, Sapporo, Fukuoka stock exchanges
5401
http://www.nssmc.com/en/index.html
Kosei Shindo, Representative Director and President
Fumiaki Ohnishi, General Manager, Public Relations Center+81-3-6867-2130
June 26, 2018
June 27, 2018
June 26, 2018
Yes
Yes (for investment analysts)

Company name:
Stock listing:Code number:
URL:
Representative:
Contact:
Telephone:
Scheduled date to Ordinary General Meeting of Shareholders:
Scheduled date to pay dividends:
Scheduled date to submit Securities Report:
Preparation of supplemental explanatory materials:
Holding of quarterly financial results meeting:（Figures of less than ¥1 million have been omitted.）

1. Consolidated Financial and Operating Results through Fiscal 2017
(April 1, 2017―March 31, 2018)(1) Consolidated Operating Results（Percentage figures are changes from the same period of the previous fiscal year.）
Profit attributable toOperating profit
Ordinary profit
owners of parent
Millions of yen%
Millions of yen%
Millions of yen%

Net sales
Millions of yen%

Fiscal 2017

5,668,663

22.4

182,38259.7

297,54170.5

195,061

49.0

Fiscal 2016

4,632,890(5.6)

114,202(31.9)

174,531(13.1)

130,946(10.0)(For reference) Comprehensive income:Fiscal 2017 ¥ 299,598 million
Fiscal 2016 ¥ 217,453 million

37.8％
―％

Earnings per share

Earnings per shareafter full dilution

Return on
EquityReturn on
AssetsReturn on
Sales

Yen

Yen

%

%

%

Fiscal 2017

221.00

―

6.4

4.0

3.2

Fiscal 2016147.97

―

4.6

2.6

2.5

(For reference) Equity in profit of unconsolidated subsidiaries and affiliates: Fiscal 2017 ¥122,675 million
Fiscal 2016 ¥79,180 million(2) Consolidated Financial Results

Millions of yen

Millions of yen

Ratio ofshareholders’ equity
to total assets%

Fiscal 2017

7,592,413

3,515,501

41.4

3,563.80

Fiscal 2016

7,261,923

3,291,015

40.6

3,340.22

Total assets

Net assets(For reference) Shareholders’ equity: Fiscal 2017
Fiscal 2016

Net assets per shareYen¥ 3,145,450 million¥ 2,948,232 million(3) Consolidated Statements of Cash-Flows
Cash flows from operating
activities
Millions of yen

Cash flows frominvesting activities
Millions of yen

Cash flows fromfinancing activities
Millions of yen

Cash and cash equivalents
at end of year
Millions of yen

Fiscal 2017

458,846(353,419)(89,190)

111,779

Fiscal 2016

484,288(343,738)(135,054)

91,391

2. Dividends
Dividends per share
End of first quarterEnd of second quarterEnd of third quarterEnd of fiscal year

Fiscal year

Yen

Yen

Yen

Yen

Yen

Fiscal 2016

―

0.00

―

45.00

45.00

Fiscal 2017

―

30.00

―

40.00

70.00

Fiscal 2018 (Forecasts)

―

―

―

―

―

Millions of yen

Ratio of cash dividends
to profit%

Ratio of cash dividends
to net assets%

Fiscal 2016

39,77630.4

1.4

Fiscal 201761,87231.7

2.0

Cash dividends

Fiscal 2018 (Forecasts)―

Notes: 1. The Company has not determined a dividend distribution plan for fiscal 2018 due to the inability to establish reasonable earnings forecasts.
The dividend distribution plan will be disclosed when it becomes available.

3. Consolidated Financial Forecasts for Fiscal 2018 (April 1, 2018―March 31, 2019)
The earnings forecasts for fiscal 2018 are not presented because the outlook has not been determined due to the difficulty formulating
reasonably accurate estimates at this time. For further details, please refer to page 8,“(2) Outlook for Fiscal 2018”of“1. Summary of
Results of Operations.”* Notes(1) Changes in significant subsidiaries during the period: None
(2) Changes in accounting principles, changes in accounting estimates, and retrospective restatements(a) Changes in accounting principles accompanying revisions in accounting standards: None(b) Changes other than those in (a) above: None(c) Changes in accounting estimates: None(d) Retrospective restatements: None
(3) Number of shares issued (common shares)(a) Number of shares issued at the end of the period (including treasury stock)
Fiscal 2017
950,321,402 sharesFiscal 2016
950,321,402 shares(b) Number of treasury stock at the end of the period
Fiscal 201767,710,915 sharesFiscal 2016
67,674,097 shares(c) Average number of shares issued during the term
Fiscal 2017882,629,157 sharesFiscal 2016
884,959,677 shares

(For Reference) A Summary of Non-Consolidated Financial and Operating Results
Non-Consolidated Financial and Operating Results through Fiscal 2017
(April 1, 2017―March 31, 2018)(1) Non-Consolidated Operating Results（Percentage figures are changes from the same period of the previous fiscal year.）Net sales

Operating profit

Ordinary profit

ProfitMillions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

Fiscal 2017

3,266,686

9.8

6,408

―

107,213122.7

118,275

184.7

Fiscal 2016

2,974,224(5.9)(29,195)―

48,132(45.3)

41,541（50.4）

Earnings per share

Earnings per share after
full dilution

Yen

Yen

Fiscal 2017133.81―

Fiscal 2016

46.87

―

(2) Non-Consolidated Financial Results
Total assets

Net assets

Ratio ofshareholders’ equity
to total assets

Net assets per share

Millions of yen

Millions of yen%

Yen

Fiscal 2017

5,235,048

2,024,648

38.7

2,290.62

Fiscal 2016

5,085,063

1,938,126

38.1

2,192.65(For reference) Shareholders’ equity: Fiscal 2017 ¥2,024,648 million
Fiscal 2016 ¥1,938,126 million* This flash report is exempt from the audit procedures.
* Explanation of the appropriate use of performance forecasts and other related items(Explanation of the appropriate use of performance forecasts)
The forward-looking statements included in this flash report are based on the assumptions, forecasts, and plans of the Company as of thedate on which this document is made public. The Company’s actual results may differ substantially from such statements due to various
risks and uncertainties.

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017

Index of Attached Documents
1. Summary of Results of Operations ..............................................................................................................................2(1) Summary of Results of Operations and Financial Position
for Fiscal Year Ended March 31, 2018 (Fiscal 2017) .............................................................................................2(2) Outlook for the Fiscal Year Ending March 31, 2019 (Fiscal 2018) .........................................................................8
2. Basic Rationale for Selection of Accounting Standards ..............................................................................................9
3. Consolidated Financial Statements and Major Notes ................................................................................................10(1) Consolidated Balance Sheets..................................................................................................................................10(2) Consolidated Statements of Operations and Consolidated Statements of Comprehensive Income .......................12(3) Consolidated Statements of Changes in Net Assets ...............................................................................................13(4) Consolidated Statements of Cash-Flows ................................................................................................................15(5) Notes to the Consolidated Financial Statements ....................................................................................................16(Notes to the Presumption of Going Concerns) .................................................................................................16(Changes in Accounting Principles Accompanying Revisions in Accounting Standards) ................................16(Segment Information) .......................................................................................................................................16(Per Share Information) .....................................................................................................................................19(Major Subsequent Events) ................................................................................................................................19

1

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017

1. Summary of Results of Operations(1) Summary of Results of Operations and Financial Position for Fiscal Year Ended March 31, 2018 (Fiscal 2017)
1. Overview of Conditions in Fiscal 2017
The global economy stayed on a recovery trend overall during the period under review. The United States maintained asteady economic recovery against the background of robust private consumption and an improvement in labor market
conditions, while Europe continued its upward trend. China experienced stable economic conditions, and developing
countries maintained a gradual economic recovery.

The Japanese economy continued to improve moderately, sustained by steady private consumption and capital investment.

Domestic demand for steel remained firm, mainly in the automotive and construction/civil engineering sectors. Overseas
steel demand also continued to increase at a moderate pace. The international steel market in general remained at highlevels, against the background of tighter supply and demand conditions and other factors.

Under such business environment, the Nippon Steel & Sumitomo Metal Corporation (NSSMC) Group made steadyprogress in implementing the strategies of the Mid-Term Management Plan to Fiscal 2017, which was launched in March2015. This included enhancing the competitiveness of the domestic “mother mills,” advancing global strategies,
augmenting technological superiority, realizing world-leading cost-competitiveness, and strengthening the Group
companies in the steelmaking business.

Operating Results by Business Segment for Fiscal 2017
The NSSMC Group’s business segments each put forth utmost management effort to generate results while responding to
the changing business environment. An overview of operating results by business segment is shown below.
(Billions of yen)
Net Sales
Steelmaking and steel fabrication
Engineering and construction
Chemicals
New materials
System solutions
Total
Adjustments
Consolidated total

Fiscal 2017
5,017.2
294.2
200.7
37.0
244.2
5,793.5(124.8)5,668.6

2

Fiscal 2016
4,052.2
267.5
174.2
34.5
232.5
4,761.0(128.1)
4,632.8

Ordinary Profit
Fiscal 2017
245.7
9.1
15.4
1.9
23.2
295.5
2.0
297.5

Fiscal 2016
138.0
6.8
4.5
1.7
22.1
173.2
1.2
174.5

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017

Steelmaking and steel fabrication
The Steelmaking and Steel Fabrication segment implemented various measures centered primarily on enhancing thecompetitiveness of the domestic “mother mills” and advancing global strategies.

In Japan, NSSMC identified the improvement and reconstruction of steelworks as a priority management issue andcontinued to implement policies to enhance these manufacturing capabilities in terms of both facilities and workforce.
Concerning facilities, NSSMC decided to refurbish the coke oven at its Muroran Works and took other measures tomaintain and strengthen the soundness of its manufacturing capabilities, including the upgrading of basic facilities. As forthe workforce, to ensure the transfer of skills without fail from the retiring older generation to the younger generations,
NSSMC strengthened its recruitment activities and took initiatives to train personnel from a long-term perspective.
Moreover, NSSMC absorbed and merged consolidated subsidiary Nippon Steel & Sumikin Kotetsu Wakayama
Corporation, which performs the upstream operations (ironmaking and steelmaking operations) in NSSMC’s Wakayama
Works, with the aim of substantially increasing management efficiency through the use of its business infrastructure.

In markets outside Japan, NSSMC took major strides toward enhancing its global supply network to capture demand inoverseas growth markets and build an operating structure that better responds to customers’ global development
requirements. For example, in Indonesia, where demand is expected to grow in the automotive market, NSSMC’s joint
venture to manufacture and sell high-grade, high-quality steel sheets for automobiles, began operation. In Brazil, NSSMC
exchanged basic agreements to introduce new governance rules and other provisions at Usinas Siderúrgicas de Minas
Gerais S.A. – Usiminas (“Usiminas”), an equity-method affiliate of NSSMC, with the Argentine company Ternium
Investments S.à r.l., which jointly manages Usiminas, and confirmed that both companies will closely cooperate toenhance the competitiveness of Usiminas and increase its corporate value.

In India, with the aim of steadily capturing significant demand growth in the medium to long term, NSSMC has decided toparticipate in the procedure for the joint acquisition of Essar Steel India Limited with ArcelorMittal. In the area ofspecialty steels where strong demand is expected, NSSMC is seeking to substantially strengthen its technologicalcapabilities, quality, and product development while enhancing as well as expanding its global business. The Company has
therefore concluded an agreement to acquire Ovako AB, a Swedish company which has world-leading technologies inbearing steel and other such products combined with a manufacturing and sales network in Europe. At the same time, inJapan, the Company has decided to commence discussions regarding making Sanyo Special Steel Co., Ltd. a subsidiary of
NSSMC and other issues.
As evidence of NSSMC’s strengths in advanced technology, a “resource-saving, environmentally friendly, highproductivity stainless steelmaking process” using a steel alloy melting furnace developed by the Company was awarded
the Okochi Memorial Foundation Special Production Award in the 64th Okochi Awards. This award is the highest of the
Okochi awards that are presented to remarkable contributions in areas such as production engineering. The process thatreceived the award this time, enables the full recycling of scrap containing chrome, which is generated by the stainlesssteel production process and other materials. It is therefore not only environmentally friendly but also contributes to3

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017

increasing productivity and reducing costs. In addition, NSSMC decided to newly install an ultra-high tensile strength
sheet manufacturing facility at its Kimitsu Works. This is expected to enable NSSMC to capture demand from theautomobile industry for materials to make vehicles lighter and stronger. Through these activities, the Company willcontinue to contribute to offering high-performance materials and solutions technologies to create new value for its
customers.

Furthermore, NSSMC also continued to strive to reduce raw material and fuel costs and improve production yield, fromthe perspective of cost reduction, and to seek the understanding and cooperation of its customers in adjusting steel productprices, given the surge in raw material prices and other factors. The steelmaking and steel fabrication segment recorded net
sales of ¥5,017.2 billion and ordinary profit of ¥245.7 billion.

Engineering and Construction
Nippon Steel & Sumikin Engineering Co., Ltd., saw signs of an improvement in the robust business environment, as oil
prices rose and overseas steelmakers resumed capital investments. Solid business conditions in the domestic construction
sector and other areas and the company’s steady control of project execution also contributed to an increase in both sales
and profit. The engineering and construction segment posted net sales of ¥294.2 billion and ordinary profit of ¥9.1 billion.

Chemicals
Nippon Steel & Sumikin Chemical Co., Ltd. expanded sales of circuit board materials and display materials for electronic
devices such as smartphones in its functional materials business, and posted record-high sales volume of both materials
during the term. In the chemicals business, supply and demand conditions for styrene monomer, a core product in thissegment, were favorable, enabling the company to report a steady gain in profit. In the coal tar chemicals business, supply
and demand conditions for needle coke were tight due to robust demand for graphite electrodes used in the electric furnace
sector, while demand for coke used in negative pole electrodes in lithium ion batteries also increased. As a result, themarket environment showed a significant improvement along with rising product price levels and other factors. The
chemicals segment recorded net sales of ¥200.7 billion and ordinary profit of ¥15.4 billion.
New Materials
Nippon Steel & Sumikin Materials Co., Ltd. within its semiconductor and electronics industrial materials business,
continued to post favorable sales of metal foils for suspension and other materials. In the field of environmental andenergy materials, sales of metal substrates expanded as the company steadily captured demand in developing countries.
Although overall performance was affected by severer competition, an increase in sales boosted both net sales and profit.
The new materials segment posted net sales of ¥37.0 billion and ordinary profit of ¥1.9 billion.

4

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017

System Solutions
NS Solutions Corporation provides comprehensive solutions in the planning, configuration, operation, and maintenance ofIT systems for clients in a wide range of business fields and develops leading-edge solutions services that respond to thechanging business conditions of its clients. During the fiscal year, the company promoted the development of solutions for
its customer enterprises to enable them to make use of AI, machine learning, and IoT and thereby enhance thesophistication of their operations in their production and logistics workplaces. This contributed to the expansion of bothsales and profit. The system solutions segment recorded net sales of ¥244.2 billion and ordinary profit of ¥23.2 billion.

Sales and Profit
The Company’s profit for the fiscal year was negatively affected by a decrease in production and shipment volume due tosome facility-related troubles and adverse weather, a surge in prices of primary raw materials, and rises in costs of some
auxiliary materials such as scrap and alloy, other materials procurement costs, and distribution costs. However, thesefactors were more than offset by positive factors such as the steady execution of cost reduction measures, the improved
performance of domestic and overseas Group companies, and the positive impact of differences in inventory valuations.
As a result, NSSMC posted consolidated net sales of ¥5,668.6 billion, operating profit of ¥182.3 billion, ordinary profit of¥297.5 billion, and profit attributable to owners of parent of ¥195.0 billion.

5

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017

Assets, Liabilities, Net Assets, and Cash Flows
Consolidated total assets at the end of fiscal 2017 were ¥7,592.4 billion, representing an increase of ¥330.4 billion from
¥7,261.9 billion at the end of fiscal 2016. The main factors accounting for this were increases of ¥54.4 billion in notes andaccounts receivable, ¥164.3 billion in inventories, and ¥55.0 billion in investments in securities.

Consolidated total liabilities at the end of fiscal 2017 were ¥4,076.9 billion, representing an increase of ¥106.0 billion from¥3,970.9 billion at the end of fiscal 2016. The main factors accounting for this were a decrease in interest-bearing
liabilities of ¥35.9 billion, from ¥2,104.8 billion at the end of fiscal 2016 to ¥2,068.9 billion at the end of fiscal 2017, a risein notes and accounts payable of ¥46.8 billion, a rise in accounts payable-other of ¥66.7 billion, and an increase in deferred
tax liabilities of ¥14.8 billion.

Net assets amounted to ¥3,515.5 billion at the end of fiscal 2017, representing an increase of ¥224.4 billion from ¥3,291.0
billion at the end of fiscal 2016. The main factors behind the increase were a rise in profit attributable to owners of parentof ¥195.0 billion, a decrease in the payment of dividends of ¥66.2 billion, an increase in unrealized gains on available-forsale securities of ¥43.8 billion, and an increase in non-controlling interests of ¥27.2 billion. As a result, shareholders’equity at the end of fiscal 2017 amounted to ¥3,145.4 billion, and the ratio of interest-bearing debt to shareholders’ equity(D/E ratio) was 0.66 times.

Cash flows provided by operating activities in fiscal 2017 amounted to an inflow of ¥458.8 billion (compared to an inflowof ¥484.2 billion in fiscal 2016). The main factors were inflows of ¥289.8 billion from profit before income taxes and¥340.7 billion from depreciation and amortization, as well as outflows from an increase in notes and accounts receivableof ¥50.1 billion and an increase in inventories of ¥162.8 billion.

Cash flows from investing activities amounted to an outflow of ¥353.4 billion (compared to an outflow of ¥343.7 billion in
fiscal 2016), as outflows from capital investments and other items of ¥403.0 billion exceeded inflows, which included
proceeds of ¥39.9 billion from sales of investment securities. The result was a free cash inflow of ¥105.4 billion in fiscal
2017 (compared to an inflow of ¥140.5 billion in fiscal 2016).

Cash flows from financing activities amounted to an outflow of ¥89.1 billion (compared to an outflow of ¥135.0 billion in
fiscal 2016) largely due to the payment of cash dividends of ¥66.2 billion at the end of fiscal 2016 and the end of first half
(interim) of fiscal 2017 and a decrease in interest-bearing debt of ¥35.9 billion. As a result of these cash flows, cash andcash equivalents at the end of the fiscal year stood at ¥111.7 billion.

6

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017

Basic Profit Distribution Policy and Distribution of Dividends for Fiscal 2017
NSSMC’s basic profit distribution policy is to pay dividends from distributable funds at the end of the first half (interim)and second half (year-end) of the fiscal year, in consideration of the consolidated operating results and such factors ascapital requirements for investment and other activities aimed at raising corporate value and performance prospects while
also considering the financial structure of the Company on both consolidated and non-consolidated bases.
NSSMC has adopted a consolidated payout ratio target of around 20%-30% as a benchmark for the “payment of dividends
from distributable funds in consideration of the consolidated operating results.”

The level of the first-half dividend is determined based on consideration of interim performance figures and forecasts forthe full fiscal year performance.

Concerning dividend distribution, in accordance with the basic profit distribution policy described above, NSSMC paid a
dividend of ¥30 per share for the end of the first half (interim). Regarding the fiscal year-end dividend, following thepreviously stated policy and in view of more favorable results in earnings compared to the most recent forecasts
announced on February 1, 2018, the Company now plans to request the approval of the General Meeting of Shareholders
to distribute a year-end dividend payment of ¥40 per share (bringing the dividend for the full year to ¥70 per share andrepresenting a consolidated payout ratio of 31.7%), raising the previously announced dividend of ¥30 per share by ¥10.

7

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017(2) Outlook for the Fiscal Year Ending March 31, 2019 (Fiscal 2018)
Outlook for Operations in Fiscal 2018
The overall global economy is expected to show a continued moderate recovery, although conditions will remain uncertain
because of political issues in various countries and other factors. This forecast assumes that the economies of both theUnited States and Europe will continue to show their upward trend, the Chinese economy continues to be firm, and theeconomies of developing countries stay on a gradual recovery path.

The Japanese economy is forecast to show a continued moderate improvement as labor market conditions show steady
improvement.

Domestic steel demand is expected to remain firm, especially in the automotive and industrial machinery sectors. We
anticipate that overseas steel demand will continue to expand at a moderate pace. In the international steel market, we areassuming that the supply and demand balance will remain relatively tight, but, since there are concerns about the impact ofprotectionist policies in the United States and other countries, close attention to future trends will be necessary.

Amid these conditions, NSSMC will continue to closely monitor trends in steel product supply and demand and raw
material prices and will also strive to implement steady cost improvement. In tandem with these initiatives, NSSMC is
working to secure appropriate sales prices for continuous supply, and will continue to seek the understanding andcooperation of its customers in adjusting steel product prices, given surges in primary raw material prices, especially forcoking coal, as well as rises in prices of some auxiliary materials such as scrap and alloy, other materials procurement
costs, and distribution costs.

NSSMC is unable at this time to establish reasonably accurate earnings estimates for fiscal 2018 due to several factors,
including the uncertainty of price trends for primary raw materials and steel products. The Company will disclose fiscal
2018 earnings forecasts when reasonable estimates become possible.

Outlook for Distribution of Dividends for Fiscal 2018
NSSMC will increase the guideline for the payment of dividends from distributable funds in consideration of consolidated
operating results in the basic profit distribution policy to a targeted consolidated payout ratio of around 30% as thebenchmark. This guideline will apply beginning with the payment of dividends for the first half (interim) of fiscal 2018 inorder to provide a higher return to shareholders.
The Company has not determined a dividend distribution plan for fiscal 2018 due to the inability to establish reasonableearnings forecasts, as stated above. The dividend distribution plan will be disclosed when it becomes available.

8

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017

2. Basic Rationale for Selection of Accounting Standards
The Company has considered transition to international accounting standards with aims to increase corporate value
through enhancement of global business development and improve international comparability of financial information incapital markets. The Company has changed timing for adoption of international accounting standards from the first quarterof the fiscal year ending March 31, 2019 to the year end of the fiscal year ending March 31, 2019 to make sure to provide
its investors with more useful information. The Company will adopt the International Financial Reporting Standards(IFRS) as international accounting standards.

Disclosure schedule
Fiscal Year

Disclosure Materials

AccountingStandards-Flash report consolidated basis results
Fiscal year ending March
31, 2018-Consolidated financial statements pursuant to theYear End

Companies Act of Japan

JGAAP-Consolidated financial statements pursuant to the
Financial Instruments and Exchange Act
1st, 2nd and 3rdquarter-Flash report consolidated basis results-Quarterly consolidated financial statements pursuant
to the Financial Instruments and Exchange Act

Fiscal year ending March-Flash report consolidated basis results

31, 2019-Consolidated financial statements pursuant to theYear EndJGAAP

Companies Act of Japan-Consolidated financial statements pursuant to the
Financial Instruments and Exchange Act

9

IFRS

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017

3. Consolidated Financial Statements and Major Notes(1) Consolidated Balance Sheets

March 31, 2017

ASSETS
Current assets :Cash and bank deposits
Notes and accounts receivable
Marketable securities
Inventories
Deferred tax assets
Other
Less: Allowance for doubtful accounts

Millions of yen
March 31, 201888,111
624,089
4,654
1,215,649
59,441
254,669(2,179)108,782
678,579
7,266
1,380,003
77,363
226,635(1,766)2,244,436

2,476,863

753,697
1,114,851
47,903
654,475
10,318259,5912,840,838

759,716
1,131,993
52,671
653,182
13,061
264,334
2,874,959

38,652359
5,229
47,04591,28732,401
1,636
4,802
46,131
84,972

816,389
1,041,397
36,713
92,94855,52145,959(3,569)2,085,361

871,399
1,069,688
32,149116,573
26,18543,346(3,726)
2,155,616

Total fixed assets

5,017,487

5,115,549

Total assets

7,261,923

7,592,413

Total current assets
Fixed assets :Tangible fixed assets :Buildings and structures
Machinery, equipment and vehicles
Tools, furniture and fixtures
Land
Leased assets
Construction in progress
Total tangible fixed assets
Intangible assets :Goodwill
Leased assets
Patents and utility rights
SoftwareTotal intangible assets
Investments and others :Investments in securities
Shares of subsidiaries and affiliates
Long-term loans receivable
Net defined benefit assets
Deferred tax assets
Other
Less: Allowance for doubtful accounts
Total investments and others

10Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017

LIABILITIESMarch 31, 2017

Current liabilities :Notes and accounts payable
Short-term loans payable
Commercial paper
Bonds due within one year
Current portion of lease obligations
Accounts payable-other
Income taxes payable
Provision for loss on construction contracts
Other

Millions of yen
March 31, 2018728,300
316,115
20,000140,000
3,769
383,125
31,9092,297
329,616775,126
300,632
76,00085,7003,016
449,91343,916
1,508
350,477

1,955,134

2,086,291

255,690
1,360,025
8,444
99,293
7,069

209,996
1,380,660
12,990114,120
7,010

4,799

4,991

188,016
92,433

166,152
94,698

Total long-term liabilities

2,015,774

1,990,620

Total liabilities

3,970,908

4,076,911

419,524
386,873
1,949,960(132,063)
2,624,294

419,524
386,865
2,076,769(132,162)
2,750,997

Accumulated other comprehensive income:Unrealized gains on available-for-sale securities
Deferred hedge income (loss)
Unrealized gains on revaluation of land
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total accumulated other comprehensive income

269,282(2,370)
3,002(9,339)63,363323,938

313,116(2,107)
3,001(4,898)85,341
394,453

Non-controlling interests in consolidated subsidiaries

342,782

370,050

Total net assets

3,291,015

3,515,501

Total liabilities and net assets

7,261,923

7,592,413

Total current liabilities
Long-term liabilities :Bonds and notes
Long-term loans payable
Lease obligations (excluding current portion)
Deferred tax liabilities
Deferred tax liabilities on revaluation of land
Allowance for retirement benefits of directors
and Audit & Supervisory Board members
Net defined benefit liabilities
Other

NET ASSETS
Shareholders' equity :Common stock
Capital surplus
Retained earnings
Less: Treasury stock, at cost
Total shareholders' equity

11

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017(2) Consolidated Statements of Operations and Consolidated Statements of Comprehensive Income
Consolidated Statements of Operations

Millions of yen
Fiscal 2016

Operating revenues :Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating profit and loss :Non-operating profit :Interest income
Dividend income
Equity in profit of unconsolidated
subsidiaries and affiliates
Other
Non-operating loss :Interest expense
Other
Ordinary profit
Extraordinary profit :Gain on sales of investment in securities
Gain on sales of shares of subsidiaries and associates
Gain on step acquisitions
Extraordinary loss :Impairment loss
Loss on inactive facilities
Loss on disaster
Restructuring loss
Profit before income taxes
Income taxes - current
Income taxes - deferred
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

Fiscal 2017

4,632,890
4,065,779
567,111452,908
114,2025,668,663
4,969,121
699,541
517,158
182,382

5,654
14,923

5,146
17,60879,180122,675

43,162
142,92155,704
201,135

18,00664,58682,593
174,531

20,10665,86985,976
297,541

24,172
10,027
34,20025,68525,685

12,793
7,839
6,407
27,039181,692
47,074(11,377)
35,697
145,995
15,048130,946

15,602
11,604
6,158
33,366
289,860
76,309(7,510)68,798221,061
26,000
195,061

Consolidated Statements of Comprehensive Income

Millions of yen
Fiscal 2016

ProfitOther comprehensive income
Unrealized gains on available-for-sale securities
Deferred hedge income (loss)
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Share of other comprehensive income of affiliates
accounted for using equity method
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests

12

Fiscal 2017

145,995

221,061

68,181
6,515(30,691)
20,34844,845(736)
10,937
23,779

7,103

(288)

71,458217,453

78,537
299,598

203,625
13,828265,294
34,303

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017(3) Consolidated Statements of Changes in Net Assets
Fiscal2016

Millions of yen
Shareholders' equity

Balance at March 31, 2016

Treasury

Total

CommonCapitalRetainedstock,

Shareholders'stocksurplusearnings

at costequity419,524

383,010

1,837,919(87,942)2,552,512

Changes of items during period
Cash dividends(13,554)

Profit attributable to owners of parent

130,946

Acquisition of treasury stock(13,554)
130,946(44,321)

Disposal of treasury stock(17)

Increase(decrease) due to the change
in the number of consolidated companies(5,385)

Increase due to reversalof unrealized gains on revaluation of land

34

Change in shares of parent arisingfrom transactions with non-controlling interests(44,321)

199

182

0

(5,385)
34

3,879

3,879

Net changes of items
other than shareholders' equity
Total change for fiscal 2016

-

3,862

112,041(44,121)71,782

Balance at March 31, 2017419,524

386,873

1,949,960(132,063)

2,624,294

Accumulated other comprehensive income
Unrealized

Balance at March 31, 2016

Total

gains onDeferred

Unrealized

Foreign

Remeasure-accumulated

available-

hedge

gains

currency

ments ofotherinterests in

Total

for-saleincomeon revaluationtranslation

definedcomprehensive

consolidated

net assets

securities(loss)of landadjustments

benefit plansincomesubsidiaries

171,378(10,883)

3,025

14,652

43,136

221,310Non-controlling

235,252

3,009,075

Changes of items during period
Cash dividends(13,554)

Profit attributable to owners of parent

130,946

Acquisition of treasury stock(44,321)

Disposal of treasury stock

182

Increase(decrease) due to the change
in the number of consolidated companies(5,385)

Increase due to reversalof unrealized gains on revaluation of land

34

Change in shares of parent arisingfrom transactions with non-controlling interests
Net changes of items
other than shareholders' equity

3,879
97,904

8,513

(23)

(23,991)

20,226102,628

107,530

210,158

Total change for fiscal 2016

97,904

8,513

(23)

(23,991)

20,226102,628

107,530

281,940

Balance at March 31, 2017269,282(2,370)

3,002(9,339)63,363323,938

342,782

3,291,015

13

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017

Fiscal2017

Millions of yen
Shareholders' equity

Balance at March 31, 2017

Treasury

Total

CommonCapitalRetainedstock,

Shareholders'stocksurplusearnings

at costequity1,949,960(132,063)

2,624,294

419,524

386,873

Changes of items during period
Cash dividends(66,293)

Profit attributable to owners of parent

195,061

Acquisition of treasury stock
Disposal of treasury stock(66,293)
195,061
(102)

(102)

3

4

0

(1,958)

1

Increase(decrease) due to the change
in the number of consolidated companies(1,959)

Increase due to reversalof unrealized gains on revaluation of land0

Change in shares of parent arisingfrom transactions with non-controlling interests

0

(8)

(8)

Net changes of items
other than shareholders' equity
Total change for fiscal 2017-(7)

126,809(98)

126,702

Balance at March 31, 2018419,524

386,865

2,076,769(132,162)

2,750,997

Accumulated other comprehensive income
Unrealized

Balance at March 31, 2017

Total

gains onDeferred

Unrealized

Foreign

Remeasure-accumulated

available-

hedge

gains

currency

ments ofotherinterests in

Total

for-saleincomeon revaluationtranslation

definedcomprehensive

consolidated

net assets

securities(loss)of landadjustments

benefit plansincomesubsidiaries

269,282(2,370)

3,002(9,339)63,363323,938

Non-controlling

342,782

3,291,015

Changes of items during period
Cash dividends(66,293)

Profit attributable to owners of parent

195,061

Acquisition of treasury stock(102)

Disposal of treasury stock

4

Increase(decrease) due to the change
in the number of consolidated companies(1,958)

Increase due to reversalof unrealized gains on revaluation of land0

Change in shares of parent arisingfrom transactions with non-controlling interests(8)

Net changes of items
other than shareholders' equity

43,834

262

(0)

4,440

21,97870,51527,267

97,783

Total change for fiscal 201743,834

262

(0)

4,440

21,97870,51527,267

224,486

Balance at March 31, 2018313,116(2,107)

3,001(4,898)85,341

394,453

370,050

3,515,501

14

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017(4) Consolidated Statements of Cash-Flows
Fiscal 2016
Cash flows from operating activities :Profit before income taxes
Adjustments to reconcile profit to net cash provided by operating activities :Depreciation and amortization
Impairment loss
Amortization of goodwill
Interest and dividend income (accrual basis)
Interest expense (accrual basis)
Equity in profit of unconsolidated subsidiaries and affiliates
Loss on disposal of tangible and intangible assets
Loss (gain) on sales of tangible and intangible assets
Loss (gain) on sales of investments in securities
Loss (gain) on sales of shares of subsidiaries and affiliates
Loss (gain) on step acquisitions
Restructuring loss
Changes in allowance for doubtful accounts
Changes in notes and accounts receivable
Changes in inventories
Changes in notes and accounts payable
Other
SubtotalInterest and dividend income (cash basis)
Interest expense (cash basis)
Income taxes (cash basis)
Net cash provided by operating activities
Cash flows from investing activities :Acquisition of tangible and intangible assets
Proceeds from sales of tangible and intangible assets
Acquisition of investments in securities
Proceeds from sales of investments in securities
Acquisition of shares of subsidiaries and affiliates
Proceeds from sales of shares of subsidiaries and affiliates
Purchase of shares of subsidiaries resulting in change in scope of consolidation
Payment for loans
Proceeds from collections of loans
Other
Net cash used in investing activities
Cash flows from financing activities :Net increase (decrease) in short-term loans
Net increase (decrease) in commercial paper
Proceeds from long-term loans
Payments of long-term loans
Proceeds from issuance of bonds and notes
Redemption of bonds and notes
Payments for purchase of treasury stock
Cash dividends
Cash dividends to non-controlling shareholders
Proceeds from issuance of common stock to non-controlling shareholders
Other
Net cash used in financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of the year
Increase (decrease) from the change in the number of consolidated companies
Cash and cash equivalents at end of year

15

Millions of yen
Fiscal 2017

181,692

289,860

304,751
4,015(20,577)
18,006(79,180)
8,694(7,192)(8,535)(24,172)(10,027)
6,407
1,439
(29,227)
26,50027,363109,945509,900
34,568(18,428)(41,751)484,288

340,719
15,602
4,774(22,754)
20,106(122,675)
4,540(9,023)(25,685)(2,635)6,158(260)(50,156)(162,841)
49,296
157,865
492,892
50,566(21,175)(63,438)
458,846(321,879)
15,004(48,715)
42,520(14,413)30,820(52,892)(9,511)
3,504
11,826(343,738)(403,064)
13,430(3,169)39,936(4,939)9,522
289(6,537)2,875(1,762)(353,419)(49,857)
13,000179,443(271,826)
20,000(50,000)(44,315)(13,554)(4,720)2,696
84,080(135,054)
(655)
4,839
85,203
1,348
91,391

1,271
56,000246,411(243,628)
40,000(140,000)(96)(66,293)(6,565)23,709(89,190)196
16,43391,391
3,953
111,779

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017(5) Notes to the Consolidated Financial Statements(Notes to the Presumption of Going Concerns)
None(Changes in Accounting Principles Accompanying Revisions in Accounting Standards)
None(Segment Information)1) Summary of reportable segment
Nippon Steel & Sumitomo Metal Corporation is a company engaged in the steelmaking and steel
fabrication businesses, and acts as the holding company for its business segment companies, which areengaged in the engineering and construction, chemicals, new materials, and system solutions businesses.
Each business segment company shares the management strategy of the Nippon Steel & Sumitomo Metal
Corporation Group, while conducting its business activities independently from and in parallel with otherGroup members. These five business segments are reportable segments.

Reportable segment

Principal businesses

Steelmaking and steel
fabrication

Manufacturing and marketing of steel products

Engineering andconstruction

Manufacturing and marketing of industrial machinery and equipment as well as
steel structures, performance of construction work under contract, waste
processing and recycling, and supplying electricity, gas, and heat

Chemicals

Manufacturing and marketing of coal-based chemical products, petrochemicals,and electronic materials

New materials

Manufacturing and marketing of materials for semiconductors and electronicparts, components, carbon fiber and composite products, and products that apply
technologies for metal processing

System solutions

Computer systems engineering and consulting services; IT-enabled outsourcing
and other services

16

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017

2) Information on the amounts of sales, profit, assets, liabilities, and other items for reportablesegments
Fiscal 2016 (April 1, 2016―March 31, 2017)(Millions of yen)
Reportable segment
Steelmaking Engineeringand steelandfabrication construction

Chemicals New materials

Systemsolutions

Total

Adjustments Consolidated

Net sales
4,016,670

234,861

168,596

34,519178,242

4,632,890-

4,632,890

35,59032,683

5,630-

54,270128,175(128,175)-

4,052,261

267,545

174,227

34,519232,5124,761,065(128,175)

4,632,890

138,017

6,838

4,518

1,786

22,113

173,274

1,256

174,531

Segment assets

6,716,970

248,628

146,406

30,584200,252

7,342,843(80,919)

7,261,923

Segment liabilities<Interest-bearing debt>

2,092,610

6,066

7,400

8,790

1,177

2,116,045(12,000)

2,104,045

294,008

2,653

6,110

2,116

4,174

309,064(4,313)

304,751

Amortization of goodwill

2,518

1,257

-

-

240

4,015

-

4,015

Interest income

5,566

124

19

16

133

5,860

(206)

5,654

Interest expenses

17,831

118

98

135

28

18,212(206)

18,00670,723

655

920

-

21

72,3206,859

79,180931,342

4,056

19,749-32

955,181

76,571

1,031,752

335,733

5,637

7,005

2,224

4,343

354,943(3,905)351,038

Sales to external customers
Inter-segment sales or transfers
Total
Segment profit<Ordinary Profit>

Other items
Depreciation and amortization

Equity in profit (loss) ofunconsolidated subsidiaries
and affiliates
Balance of investments in equity
method companies
Increase (decrease) intangible/intangible assets

Information of net sales about geographical area
(Millions of yen)Japan2,955,981

Overseas
1,676,909

Asia
1,042,224

Other
634,684

Total
4,632,890

Note: Sales information is based on the geographical location of customers, and it is classified by region.

17

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017

Fiscal 2017 (April 1, 2017―March 31, 2018)(Millions of yen)
Reportable segment
Steelmaking Engineeringand steelandfabrication construction

Chemicals New materials

Systemsolutions

Total

Adjustments Consolidated

Net sales
4,983,335

260,908

197,057

37,050190,310

5,668,663-

5,668,663

33,91033,3603,709-

53,889124,868(124,868)-

5,017,245

294,268

200,767

37,050244,200

5,793,531(124,868)

5,668,663

245,708

9,110

15,4801,919

23,292295,5102,030

297,541

Segment assets

7,003,681

247,696

154,230

30,758

223,601

7,659,967(67,554)

7,592,413

Segment liabilities<Interest-bearing debt>

2,057,997

8,313

4,520

6,999

3,693

2,081,524(12,527)

2,068,996

330,393

2,489

5,467

1,861

4,646

344,859(4,140)340,719

Amortization of goodwill

3,029

1,279

-

-

465

4,774

-

4,774

Interest income

4,983

180

35

2

146

5,348

(202)

5,146

Interest expenses

20,080

44

42

130

11

20,309(202)

20,106

116,408

378

148

-

(10)

116,9255,750

122,675

950,887

4,393

24,843-17980,142

83,614

1,063,757

390,623

6,301

5,863

2,633

7,638

413,061(1,130)411,930

Sales to external customers
Inter-segment sales or transfers
Total
Segment profit<Ordinary Profit>

Other items
Depreciation and amortization

Equity in profit (loss) ofunconsolidated subsidiaries
and affiliates
Balance of investments in equity
method companies
Increase (decrease) intangible/intangible assets

Information of net sales about geographical area
(Millions of yen)Japan
3,708,644

Overseas1,960,019

Asia
1,267,604

Other692,414

Total
5,668,663

Note: Sales information is based on the geographical location of customers, and it is classified by region.

18

Nippon Steel & Sumitomo Metal Corporation (5401)
Fiscal 2017

(Per Share Information)(Yen)
Fiscal 2016
(April 1, 2016－March 31, 2017)

Fiscal 2017
(April 1, 2017－March 31, 2018)

Net assets per share

3,340.22

3,563.80

Earnings per share

147.97221.00Regarding diluted earnings per share, no figures for diluted earnings per share have been disclosed because no latent shares existed.

Notes: Basis for calculations
1. Earnings per share(Yen)
Fiscal 2016
(April 1, 2016－March 31, 2017)

Fiscal 2017
(April 1, 2017－March 31, 2018)

Earnings per share
Profit attributable to owners of parent

130,946 Million

195,061 Million

Value not available to common shares― Million― Million

130,946 Million

195,061 Million

884,959,677 Shares

882,629,157 Shares

Profit attributable to owners of parent available tocommon shares
Average number of outstanding common shares during
the period

2. Net assets per share(Yen)
End of fiscal 2016
(March 31, 2017)
Total net assets

End of fiscal 2017
(March 31, 2018)

3,291,015 Million

3,515,501 Million

Amounts deducted from total net assets

342,782 Million

370,050 Million(Portion of non-controlling interests)(342,782 Million)(370,050 Million)

2,948,232 Million

3,145,450 Million

882,647,305 Shares

882,610,487 Shares

Net assets at fiscal year-end available to common shares
Number of common shares at fiscal year-end used in
calculating net assets per share(Major Subsequent Events)
None19