Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022
<Under Japanese GAAP>

February 9, 2022

These financial statements have been prepared for reference only in accordance with accounting principles and practices generally accepted in Japan.

Stock exchange listing: Tokyo (First Section)
NAGASE & CO., LTD.
Code number:8012
URL (https://www.nagase.co.jp/english/)Representative:
Kenji Asakura, Representative Director and President
Contact:
Yoshihisa Shimizu, Executive Officer, General Manager, Corporate Management Department
TEL:+81-3-3665-3103
Filing of quarterly report (scheduled): February 14, 2022
Start of distribution of dividends (scheduled): Supplementary documents of quarterly financial results: Yes
Quarterly investors' meeting: No(Note: Amounts have been rounded down to the nearest million yen.)

1. Consolidated Results for the Third Quarter of the Fiscal Year Ending March 31, 2022
(April 1, 2021 to December 31, 2021)(1) Consolidated Operating Results
Net sales
For the third quarter ended

December 31, 2021
December 31, 2020

Millions of yen

574,139453,993

Gross profit%

26.5(Notes) 1. Comprehensive income－%

Millions of yen

104,107
83,71424.4
7.6(% = year-on-year change)

Operating income

Ordinary income

Profit attributable toowners of the parent

Millions of yen

Millions of yen

Millions of yen

28,151
16,065%75.2

30,17017,159

6.7

%

75.8

%

22,23016,556

9.2

34.3
37.4

Third quarter ended December 31, 2021: ¥27,354 million (9.1% decrease)
Third quarter ended December 31, 2020: ¥30,089 million (102.4%)

2. At the beginning of the first quarter of the fiscal year ending March 2022, the Company adopted the Accounting Standard
for Revenue Recognition (Accounting Standards Board of Japan (ASBJ) Statement No. 29, March 31, 2020). Results forthe third quarter of the fiscal year ended March 2021 reflect a retroactive application of this accounting standard. As aresult, net sales affected by this retroactive application do not show the year-on-year rate of change in the third quarter ofthe fiscal year ended March 2021.
Earnings per share
For the third quarter ended
December 31, 2021
December 31, 2020

Earnings per share (diluted)
Yen

Yen

182.40133.51−−(2) Consolidated Financial Position
Total assets

Net assets

Millions of yen

Millions of yen

725,313640,587

December 31, 2021
March 31, 2021
(Reference) Equity capital

Shareholders’equity ratio

Net assets per share%

354,866
338,431

Yen

2,855.86
2,670.09

47.5
51.5

As of December 31, 2021: ¥ 344,403 million
As of March 31, 2021:¥ 329,687 million

2. Dividends
1Q
For the year ended (or ending)March 2021
March 2022
March 2022 (forecast)

2Q
Yen

−
−

(Note) Revisions to the latest dividends forecast: Yes

Annual Dividends per Share
3Q
Fiscal year end
Yen

22.00
24.00

Yen

−
−

Yen

Annual
Yen

24.00

46.00

30.00

54.00

3. Consolidated Earnings Forecast for the Fiscal Year Ending March 31, 2022
(April 1, 2021 to March 31, 2022)(% = year-on-year change)

Gross profit
Full fiscal year

Millions of yen

138,000

Operating income%

20.4

Millions of yen

35,000

Profit attributable toowners of the parent

Ordinary income%

59.7

Millions of yen

36,500%59.7

Millions of yen

25,000Earnings per
share

%

32.8

Yen

205.73(Notes) 1. Revisions to the latest consolidated earnings forecast: Yes
2. For details, please refer to 1. Qualitative Information, (3) Qualitative Information Related to Consolidated Earnings
Forecasts, on P.6 of this document.

* Notes(1) Changes in major subsidiaries during the period (changes in specified subsidiaries accompanying changes in thescope of consolidation): No
New: ― (Company name:)
Excluded: ― (Company name:)(2) Application of special accounting methods to the preparation of quarterly financial statements: Yes(Note) For details, please refer to 2. Quarterly Consolidated Financial Statements and Notes, (3) Notes Related to Quarterly
Consolidated Financial Statements (Special Accounting Treatment Applied in the Preparation of Quarterly Consolidated
Financial Statements), on P.11 of this document.

(3) Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial
statements after error correctionsi.
Changes in accordance with revisions to accounting and other standards: Yes
ii. Changes in items other than (i) above: Yesiii. Changes in accounting estimates: No
iv. Restatement of prior period financial statements after error corrections: No(Note) For details, please refer to 2. Quarterly Consolidated Financial Statements and Notes (3) Notes Related to Quarterly
Consolidated Financial Statements (Change in Accounting Policy), on P.11 of this document.

(4) Number of shares issued and outstanding (common stock)i.
Number of shares issued and outstanding as of the fiscal period end (including treasury stock)
124,408,285 shares March 31, 2021
124,408,285 shares
December 31, 2021
ii.

iii.

Number of treasury stock as of the fiscal period end
3,812,728 shares
December 31, 2021

March 31, 2021

Average number of shares during the period
121,878,419 shares
December 31, 2021

December 31, 2020

933,995 shares

124,011,458 shares* Quarterly financial statements are not subject to quarterly review.
* Cautionary Statement with Respect to Forecasts of Consolidated Business Results
The earnings forecasts presented in this document are based upon currently available information and assumptions deemed rational. A
variety of factors could cause actual results to differ materially from forecasts.
For matters related to earnings forecasts, please refer to 1. Qualitative Information, (3) Qualitative Information Related toConsolidated Earnings Forecasts, on P.6 of this document.

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022

Attachments
1.

Qualitative Information

2(1) Review of Business Performance2(2) Review of Financial Position

5(3) Qualitative Information Related to Consolidated Earnings Forecasts

6

2． Quarterly Consolidated Financial Statements and Notes

7(1) Quarterly Consolidated Balance Sheets

7(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive Income

9

Quarterly Consolidated Statements of Income
Nine-month periods ended December 31, 2020 and 2021

9

Quarterly Consolidated Statements of Comprehensive Income
Nine-month periods ended December 31, 2020 and 2021

10(3) Notes Related to Quarterly Consolidated Financial Statements

11(Assumption for Going Concern)

11(Significant Fluctuations in Shareholders’ Equity)

11(Special Accounting Treatment Applied in Preparing Quarterly Consolidated Financial Statements)

11(Change in Accounting Policy)

11(Additional Information)

12(Segment Information, etc.)13（Significant Subsequent Events）

16

- 1 -

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022

1. Qualitative Information(1) Review of Business Performancea.

General Summary of Results

The global economy for the cumulative consolidated third quarter of the current fiscal year showed overall improvement,
though unpredictable circumstances remain regarding the economic impact of COVID-19, including the recent spread of ahighly infectious new variant.
Among the regions where the NAGASE Group operates, economic activity was strong in Greater China due to solid domestic
demand and rising resin market conditions. In Europe, the Americas and ASEAN, despite a fundamental trend toward
recovery, the degree of recovery varied from region to region and country to country due to labor shortages in North America,
rising energy prices, and worldwide supply chain disruptions centered on global semiconductor shortages. In Japan, there was ageneral trend toward recovery in economic activities due to a rebound in personal consumption as the state of emergency waslifted after falling COVID-19 case counts, as well as a recovery in production activities in the manufacturing industry.
In this environment, earnings for the cumulative consolidated third quarter of the current fiscal year are as follows.
(Millions of yen)
Nine-month period

Nine-month period

ended December
31, 2020

ended December
31, 2021

Net sales

453,993574,139

120,145

26.5

Gross profit

83,714104,107

20,393

24.4

Operating income

16,06528,151

12,08675.2

Ordinary income

17,15930,17013,01075.8

Profit before income taxes
Profit attributable to owners

25,29831,831

6,532

25.8

16,55622,230

5,674

34.3

of the parent*

ChangeChange (%)

At the beginning of the first quarter of the current consolidated fiscal year, the Company adopted the Accounting Standard

for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020). Indicators for the cumulative consolidated third
quarter of the previous fiscal year reflect a retroactive application of this accounting standard.
・ For performance in the cumulative consolidated third quarter of the current fiscal year, higher profit in all segments
resulted in all stages of profit below gross profit reaching record highs for the third quarter.
・ Factors behind the higher profits were the recovery of the automobile-related business, which was greatly affected by
COVID-19 in the first half of the prior consolidated fiscal year, the continued strong performance of the electronics-related
business and resins business from the second half of the prior consolidated fiscal year, and performance of the Prinova
Group in the Life & Healthcare Segment driving up profits. For details, see b. Segment Summary.
・ Profit attributable to owners of the parent amounted to ¥22.2 billion, up ¥5.6 billion mainly due to a reactionary bounce
from recording profits stemming from the sales of certain shares owned by the Company during the cumulative
consolidated third quarter of the previous fiscal year, despite an increase in ordinary income of ¥13.0 billion.

- 2 -NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022b.

Segment Summary

The following describes performance by segment.
Note that as of the first quarter of the current fiscal year under review, the names and categorizations for reportable segments
have been partially amended. Year-on-year amounts and ratios for the cumulative consolidated third quarter of the previous
fiscal year are calculated after rearranging reportable segment classifications to match those of the cumulative consolidated
second quarter of the current fiscal year.
Functional Materials(Millions of yen)
Nine-month period

Nine-month period

ended December
31, 2020

ended December
31, 2021

Net sales

53,97974,412

20,43237.9

Gross profit

11,233

14,721

3,488

31.1

Operating income

3,325

5,956

2,631

79.1

ChangeChange (%)

The major factors behind performance were as follows.
・ Raw materials sales recovered for coating and urethane raw materials as well as those related to processing industrial oil
solutions and plastic materials, driven by a recovery in automobile production
・ Sales trended strong in areas like electronics chemicals for the electronics industry, such as for semiconductor-related
products
・ Operating income increased due to an increase in gross profit
Advanced Materials & Processing(Millions of yen)
Nine-month period

Nine-month period

ended December
31, 2020

ended December
31, 2021

Net sales

152,245

191,861

39,61526.0

Gross profit

19,597

24,539

4,941

25.2

Operating income

5,235

8,894

3,659

69.9

ChangeChange (%)

The major factors behind performance were as follows.
・ Sales increased for resins in the office equipment, appliance, and video game device markets due to increased demand inJapan and overseas, mainly in China, and profitability improved due to soaring market conditions
・ Sales increased for resins for industrial and packaging applications, as well as dyes and additives, due to recovery indemand・ Sales decreased for digital print processing materials and conductive materials
・ Operating income increased due to an increase in gross profit- 3 -NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022

Electronics & Energy(Millions of yen)
Nine-month period

Nine-month period

ended December
31, 2020

ended December
31, 2021

Net sales

79,393

95,643

16,25020.5

Gross profit

18,176

22,531

4,355

24.0

Operating income

5,810

7,945

2,134

36.7

ChangeChange (%)

The major factors behind performance were as follows.
・ Sales increased for display materials and related to precision processing materials for semiconductors
・ Sales related to formulated epoxy resins increased, primarily for mobile devices and semiconductors
・ Sales related to photolithography materials increased with increased demand for displays
・ Operating income increased due to an increase in gross profit
Mobility(Millions of yen)
Nine-month period
ended December

Nine-month period
ended December

31, 2020

31, 2021

ChangeChange (%)

Net sales

55,13373,89018,75734.0

Gross profit

6,150

9,321

3,171

51.6

Operating income

1,104

3,109

2,004

181.4

The major factors behind performance were as follows.
・ In the resins business, sales increased domestically and overseas, primarily in ASEAN, due to recovery in automobile
production, and profitability increased owing to rising market conditions
・ Sales increased in functional materials and functional components for interior and exterior fittings and electrification
・ Operating income increased due to an increase in gross profit
Life & Healthcare(Millions of yen)
Nine-month period
ended December

Nine-month period
ended December

31, 2020

31, 2021

ChangeChange (%)

Net sales

112,958

138,150

25,191

22.3

Gross profit

28,37332,915

4,542

16.0

Operating income

5,145

7,365

2,219

43.1

The major factors behind performance were as follows.
・ Materials sales, manufacturing, and processing all trended strongly in the nutrition-related business・ Sales increased related to food materials, primarily TREHA™, and in cosmetics materials, primarily AA2G™, owing torecovery in demand
・ Sales increased for pharmaceutical raw materials and intermediates
・ Operating income increased due to an increase in gross profit
OthersNo special matters to disclose.

- 4 -NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022

(2) Review of Financial Position(Millions of yen)
Prior Consolidated
Fiscal Year
(March 31, 2021)

Third Quarter,
Current Consolidated
Fiscal Year

ChangeChange (%)(December 31, 2021)

Current assets

401,751

486,399

84,64821.1

Non-current assets

238,835

238,91378

0.0

Total assets

640,587

725,31384,726

13.2

Liabilities

302,155

370,447

68,292

22.6

Net assets

338,431354,866

16,434

4.9

51.5

47.5

(4.0) p－Shareholders’ equity ratio (%)

・ Current assets increased mainly due to an increase in inventories and accounts receivable, despite a decrease in cash anddeposits
・ Non-current assets increased slightly due to an increase in intangible fixed assets, despite lower fair values of investments
in securities
・ Liabilities increased mainly due to an increase in accounts payable and short-term loans
・ Net assets increased due to the recording of quarterly profit attributable to owners of the parent and an increase intranslation adjustments, despite decreases from purchases of treasury stock and payments of dividends
・ As a result, the Company recorded a shareholders’ equity ratio of 47.5%, down 4.0 points compared to 51.5% from the endof the prior consolidated fiscal year

- 5 -

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022

(3) Qualitative Information Related to Consolidated Earnings Forecasts
During the cumulative consolidated third quarter of the fiscal year ending March 2022, there were signs of a rebound ineconomic activity in Japan and other countries due to factors such as the progress in COVID-19 vaccinations, although thisrebound varied in degree from region to region. Amid this scenario, the automobile-related business recovered beyond thepreviously announced forecast, and the resins business increased its profitability thanks to rising market conditions.
Furthermore, the electronics-related business, with its focus on mobile devices, displays and semiconductors, maintained
strong performance mainly thanks to increased demand for digital devices due to lifestyle changes, trending above thepreviously announced forecast.
We forecast a decline in profitability in the resins business and an increase in general and administrative expenses due to strong
earnings performance in the consolidated fourth quarter of the current fiscal year. However, we have upwardly revised our fullyear earnings forecast due to the expectation of maintaining strong performance in our businesses overall and of achieving acertain level of profit.
As a result, we forecast that each stage of profit will mark new record highs.
We have changed our assumed foreign exchange rates from ¥109.5 to ¥111.9 to the U.S. dollar and from ¥16.9 to ¥17.4 to the
RMB.
a. Revision to full-year earnings forecast (April 1, 2021 - March 31, 2022)(Millions of yen)Previous Forecast (A)Revised Forecast (B)Change (B-A)

Change (%)

Gross profit

130,000

138,000

8,000

6.2

Operating income

30,00035,000

5,000

16.7

Ordinary income

31,00036,500

5,500

17.7

Profit attributable toowners of the parent

22,50025,000

2,500

11.1

b. Revised gross profit and operating income forecasts by segment (April 1, 2021 - March 31, 2022)
Gross profit by segment(Millions of yen)Previous Forecast (A) Revised Forecast (B)Change (B-A)

Change (%)

Functional Materials

17,70019,500

1,800

10.2

Advanced Materials &Processing

29,50031,9002,400

8.1

Electronics & Energy

27,40029,8002,400

8.8

Mobility

11,20012,400

1,200

10.7

Life & Healthcare

43,70043,900200

0.5

Others & Corporate

500

500

-

-

130,000

138,000

8,000

6.2

Total gross profit
Operating income by segment(Millions of yen)Previous Forecast (A) Revised Forecast (B)Change (B-A)

Change (%)

Functional Materials

6,600

7,800

1,200

18.2

Advanced Materials &Processing

9,600

10,800

1,200

12.5

Electronics & Energy

8,800

10,000

1,200

13.6

Mobility

3,400

4,100

700

20.6

Life & Healthcare

9,300

9,300

-

-

Others & Corporate(7,700)(7,000)700-

Total operating income

30,00035,000

5,000

16.7

- 6 -

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022

2. Quarterly Consolidated Financial Statements and Notes(1) Quarterly Consolidated Balance Sheets
Prior Consolidated Fiscal Year
(March 31, 2021)
ASSETS
Current assets
Cash and time deposits
Notes and accounts receivable
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Less allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Intangible fixed assets
Goodwill
Technology-based assets
Other
Total intangible fixed assets
Investments and other assets
Investments in securities
Retirement benefit asset
Deferred tax assets
Other
Less allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

7(Millions of yen)
Third Quarter, Current
Consolidated Fiscal Year
(December 31, 2021)

49,254
242,558
88,1301,654
7,457
13,259(563)
401,751

48,813
289,029
123,567
1,860
10,55913,709(1,138)486,399

70,89670,97730,216
7,488
26,89364,59830,722
6,306
30,52567,55493,719
2,929
1,903
4,900
(112)
103,340
238,835
640,587

89,420
3,257
1,840
5,974
(112)
100,381
238,913725,313

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022

Prior Consolidated Fiscal Year
(March 31, 2021)
LIABILITIESCurrent liabilities
Notes and accounts payable
Short-term loans
Current portion of long-term loans
Commercial paper
Current portion of bonds
Accrued income taxes
Accrued bonuses for employees
Accrued bonuses for directors
Other
Total current liabilities
Long-term liabilities
Bonds
Long-term loans
Deferred tax liabilities
Retirement benefit liability
Other
Total long-term liabilities
Total liabilities
NET ASSETS
Shareholders’ equity
Common stock
Capital surplus
Retained earnings
Less treasury stock, at cost
Total shareholders’ equity
Accumulated other comprehensive income
Net unrealized holding gain on securities
Deferred gain on hedges
Translation adjustments
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

8(Millions of yen)
Third Quarter, Current
Consolidated Fiscal Year
(December 31, 2021)

119,941
33,05012,025
8,000
－
3,565
6,042
203
23,310206,139

150,868
62,541
9,490
20,00010,000
4,715
4,800
221
25,657288,294

30,00034,514
16,077
13,292
2,131
96,016302,155

20,00031,94514,00913,624
2,573
82,152
370,447

9,699
10,646
265,920(1,503)284,763

9,699
10,639282,282(6,482)
296,139

43,57672
1,006
268
44,924
8,743
338,431640,587

39,72738
8,437
59
48,263
10,462354,866
725,313

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022

(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive
Income(Quarterly Consolidated Statements of Income)Nine-month periods ended December 31, 2021 and 2020

(Millions of yen)
Nine-month period ended
December 31, 2020

Nine-month period ended
December 31, 2021

453,993370,279
83,71467,64816,065574,139
470,031
104,10775,95528,151

101
1,023
199
－
518
493
2,336

108
1,240
206
118
964
561
3,199

770
189
283
1,242
17,159

861
－
319
1,181
30,170

70
5,769
2,657
－

12
2,324
－
42

－
8,497

304
2,684

7
64
29
10
163
1
82
359
25,298
8,187
17,110553
16,556

176
407
－
6
171
59
201
1,023
31,831
8,544
23,286
1,056
22,230(April 1, 2020 – December 31, 2020) (April 1, 2021 – December 31, 2021)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Rent income
Equity in earnings of affiliates
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses
Equity in losses of affiliates
Other
Total non-operating expenses
Ordinary income
Extraordinary gains
Gain on sales of non-current assets
Gain on sales of investment securities
Gain on sales of shares of subsidiaries and affiliates
Gain on sales of investments in capital of subsidiaries
and affiliates
Other
Total extraordinary gains
Extraordinary losses
Loss on sales of non-current assets
Loss on disposal of non-current assets
Impairment losses
Loss on sales of investment securities
Loss on valuation of investment securities
Loss on sales of shares of subsidiaries and affiliates
Other
Total extraordinary losses
Income before income taxes
Income taxes
Profit for the period
Profit attributable to non-controlling interests
Profit attributable to owners of the parent

9

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022

(Quarterly Consolidated Statements of Comprehensive Income)Nine-month periods ended December 31, 2021 and 2020

(Millions of yen)
Nine-month period ended
December 31, 2020

Nine-month period ended
December 31, 2021

17,11023,286

14,838(48)(2,113)414(112)(3,849)
(33)
7,919
(208)
240

12,97930,0894,067
27,35429,494594

25,596
1,758(April 1, 2020 – December 31, 2020) (April 1, 2021 – December 31, 2021)

Profit for the period
Other comprehensive income
Net unrealized holding gain (loss) on securities
Deferred loss on hedges
Translation adjustments
Remeasurements of defined benefit plans
Share of other comprehensive (loss) income ofaffiliates accounted for by the equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to:Shareholders of the parent
Non-controlling interests- 10 -

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022

(3) Notes Related to Quarterly Consolidated Financial Statements(Assumption for Going Concern)
No matters to report.
(Significant Fluctuations in Shareholders’ Equity)
Following a resolution by the Company’s board of directors at a meeting held February 5, 2021, the Company acquired
2,878,600 shares of treasury stock in the cumulative third quarter of the current consolidated fiscal year. As a result, treasury
stock increased by ¥4,978 million, with treasury stock holdings of ¥6,482 million as of the end of the consolidated third
quarter.
(Special Accounting Treatment Applied in the Preparation of Quarterly Consolidated Financial Statements)(Calculation of Tax Expenses)
Tax expenses are calculated by rationally estimating an effective tax rate after applying tax effect accounting to profit before
income taxes for the consolidated fiscal year, including the current second quarter, and multiplying profit before income taxes
for the second quarter by the estimated effective tax rate.
In the event that the calculated tax expenses using this estimated effective tax rate lead to significantly unreasonable results,
this shall be calculated by multiplying the statutory effective tax rate after adjusting significant non-temporary differences by
the profit before income taxes.
Deferred income taxes are included in income taxes.
(Change in Accounting Policy)(Change in Calculation Method of Tax Expenses)
While tax expenses had previously been calculated using principle-based methods, in order to rapidly and efficiently address
this in quarterly financial settlements, the method for calculating tax expenses for the Company and its domestic consolidated
subsidiaries have been changed to that listed in (Special Accounting Treatment Applied in the Preparation of Quarterly
Consolidated Financial Statements) from the consolidated first quarter of the current fiscal year.
Note that as impact from this change is minor, the change is not applied retroactively.
(Application of Accounting Standards for Revenue Recognition)
At the beginning of the consolidated first quarter of the current fiscal year, the Company adopted the Accounting Standard for
Revenue Recognition (ASBJ Statement No. 29, March 31, 2020). As a result, revenue is now recognized as the amount
expected to be received in exchange for promised goods or services at the time of the transfer of their control to the customer.
As a result, in transactions for which the Company's performance obligations in its contracts with customers are determined to
be services as an agent arranging provision of goods or services by another party, the sales to customers previously recorded ona gross basis shall be offset by the corresponding cost of sales, and revenue shall be stated on a net basis.
Since these changes in accounting methods shall be applied retroactively as a rule, consolidated financial statements for thesame period in the prior fiscal year and for the end of the prior fiscal year shall be presented with retroactive application.
As a result, net sales and cost of sales each were reduced by ¥150,548 million in the cumulative consolidated third quarter ofthe previous fiscal year and ¥181,735 million in the cumulative consolidated third quarter of the current fiscal year. Note that
this change has no impact on any stage of profits below gross profit for either of the aforementioned periods, nor on theamount of net assets.
(Application of Accounting Standard for Fair Value Measurement)
As of the beginning of the consolidated first quarter of the current fiscal year, the Company has applied the AccountingStandard for Fair Value Measurement (ASBJ Statement No. 30, July 4, 2019). In accordance with the transitional treatmentprescribed in Paragraph 19 of the Accounting Standard for Fair Value Measurement and Paragraph 44-2 of AccountingStandard for Financial Instruments (ASBJ Statement No. 10, July 4, 2019), new accounting policies prescribed by the
Accounting Standard for Fair Value Measurement have been adopted prospectively. There is no effect by this change on the
consolidated financial statements.

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NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022

(Additional Information)(Application of Tax Effect Accounting for Transition from Consolidated Taxation System to Group Tax Sharing System)
The Company and certain domestic consolidated subsidiaries have calculated the amounts of deferred tax assets and deferred
tax liabilities in accordance with the provisions of tax laws in Japan prior to the amendments based on the treatments stipulated
in Paragraph 3 of Practical Solution on the Treatment of Tax Effect Accounting for the Transition from the Consolidated
Taxation System to the Group Tax Sharing System (ASBJ Practical Issues Task Force No. 39, March 31, 2020) instead of
applying the provision of Paragraph 44 of Implementation Guidance on Tax Effect Accounting (ASBJ Guidance No. 28,
February 16, 2018), regarding the transition to group tax sharing system provided for in Act for Partial Amendment of the
Income Tax Act, etc. (Act No. 8 of 2020), and items for which the non-consolidated taxation system has been reviewed in linewith the transition to the group tax sharing system.
(Effects of COVID-19 Pandemic When Making Accounting Estimates)
There are no significant changes to the assumption of estimates related to the impact of COVID-19 stated in Additional
Information of the securities report for the fiscal year ended March 31, 2021.

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NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022

(Segment Information, etc.)
Segment Information
I Nine-month period ended December 31, 2020 (consolidated)
1. Information related to net sales and income (loss) by reportable segment(Millions of yen)
Reportable Segments
Advanced Electronics &FunctionalLife &
Materials &Mobility
Materials
Healthcare
EnergyProcessing

Total

Others(Note) 1

Total

Corporate Adjustments Consolidated(Note) 3(Note) 4(Note) 2

Net sales
Sales tocustomers
Intersegment
sales/transfers

53,979152,245

79,39355,133112,958

453,710282

453,993－－453,993

313

1,146

1,124

1,389

241

4,214

4,160

8,374

－

(8,374)－

Total

54,292

153,392

80,51756,522

113,200

457,924

4,443

462,367－(8,374)453,993

Segment income(loss)

3,325

5,235

5,810

1,104

5,145

20,622280

20,902(5,198)362

16,065(Note) 1. “Others” is a business segment consisting of businesses not included in Reportable Segments, and includes logistics
services, information processing services, and professional services.
2. Corporate segment income (loss) represents expenses not allocated to Reportable Segments or Others.
3. Adjustments are eliminations of intersegment transactions.
4. The sum of segment income (loss) Total, Corporate, and Adjustments is equivalent to operating income as presented in“Consolidated”.
II Nine-month period ended December 31, 2021 (consolidated)
1. Information related to net sales and income (loss) by reportable segment(Millions of yen)
Reportable Segments
Advanced Electronics &Life &
Functional
Materials &Mobility
Healthcare
Materials
EnergyProcessing

Total

Others(Note) 1

Total

Corporate Adjustments Consolidated(Note) 2(Note) 3(Note) 4

Net sales
Sales tocustomers
Intersegment
sales/transfers

74,412

191,861

95,64373,890138,150

573,958180

574,139－－

574,139

528

570

1,789

1,752

333

4,974

3,443

8,418

－

(8,418)－

Total

74,940

192,431

97,43375,643

138,483

578,933

3,624

582,557－(8,418)574,139

Segment income(loss)

5,956

8,894

7,945

3,109

7,365

33,271

139

33,411(5,517)258

28,151(Note) 1. “Others” is a business segment consisting of businesses not included in Reportable Segments, and includes information
processing services and professional services.
2. Corporate segment income (loss) represents expenses not allocated to Reportable Segments or Others.
3. Adjustments are eliminations of intersegment transactions.
4. The sum of segment income (loss) Total, Corporate, and Adjustments is equivalent to operating income as presented in“Consolidated”.

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NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022

2．Matters Related to Changes in Reportable Segments(Change in Business Segments)
From the consolidated first quarter of the current fiscal year, the Electronics Segment has been renamed to the Electronics &Energy Segment, and the Mobility & Energy Segment has been renamed to the Mobility Segment, with changes to businesssegmentation as follows.
For the purpose of promoting development of new businesses, the Energy Business Office previously classified under the
Mobility & Energy Segment, as well as the Advanced Information and Communications Project Team previously classified
under the Others/Corporate category, have been unified in the newly established Information and Communication・Energy
Office, classified under the Electronics & Energy Segment. In addition, for the purpose of expanding market share andimproving synergies, the fluorine business in the Specialty Chemicals Division, which was previously classified under the
Functional Materials Segment, has been moved to the Electronics & Energy Segment.
Segment information provided for the cumulative consolidated third quarter of the previous fiscal year is based on post-change
classification methods.
The following describes the major products and services handled by each reportable segment.
The Functional Materials segment is engaged in the sales of materials for paints/inks, and adhesives, urethane materials andauxiliary materials, plastic materials, plastic additives, industrial oil solutions, water processing raw materials, surfactant raw
materials, fluorochemicals, encapsulant materials, 5G materials, silicone materials, environmental solutions and environmentrelated commercial products, sintered metal filters, and more for the paints/inks, resins, urethane foam, organic synthesis,
surfactants, electronics chemicals, communications equipment, water processing, metal processing, plastic and film processing,and other industries.
The Advanced Materials & Processing Segment is engaged in the sales of dyestuffs, pigments, functional pigments, digitalprint processing products, thermoplastic resins, thermosetting resins, automobile refinish paints, conductive coatings, synthetic
rubber, inorganic materials, plastics products, resin molding tools/dies, and more for the dye/additive, digital print processing
material, fiber processing, raw resin material, resin molding, functional film and sheet, appliance and office automation device,electronics, packaging material, construction material, and other industries.
The Electronics & Energy Segment is engaged in the sales of formulated epoxy resins, fluorine products, precision abrasives,semiconductor assembly materials and devices, adhesives and encapsulant materials, display panel components and devices,chemical management equipment for display manufacturing processes, low-temperature/vacuum equipment, LEDs, 3D
printing products, design and manufacture of storage battery systems, solar panels, optical wireless communication equipment,
and other products for the semiconductor, electronic component, AR/VR, environmental energy, 3D printing, heavy electricaland light electrical, HDD, automotive and aircraft, display, touch panel, housing, lighting, storage battery, energy, renewableenergy, security device, large-scale commercial facility, and other industries. Its main services include energy management
system proposals and battery assessments.
The Mobility Segment is engaged in the sales of plastic products in general, materials for secondary batteries, interior andexterior materials and components, materials for functional components, products for electrification, sensor components, invehicle electronics products, in-vehicle display-related components, self-driving-related products, and other products for theoverall mobility industry and related industries.
The Life & Healthcare segment is engaged in the sale of pharmaceutical/agricultural chemicals and materials, research
products, in vitro diagnostics, enzymes, food additives, food ingredients, sports nutrition products, nutrient premixes, additives
for cosmetics, feeds, and surfactants for the pharmaceutical, food and beverage, cosmetics, agricultural, toiletries, and healthcare industries. The segment offers radiation measurement as one of its main services. In addition, this segment sells cosmetics,
health foods, and beauty foods directly to consumers.

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NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022

(Application of Accounting Standards for Revenue Recognition)
As described in (Change in Accounting Policy), at the beginning of the first consolidated quarter for the current fiscal year, theCompany adopted the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020), changing its
accounting method for revenue recognition. As a result, measurement methods have similarly been changed for businesssegment profit and loss.
Segment information provided for the cumulative consolidated third quarter of the previous fiscal year is based on the changed
profit or loss measurement method.

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NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the Third Quarter of the Fiscal Year Ending March 31, 2022

(Significant Subsequent Events)(Purchase of Treasury Stock)
At a meeting held February 9, 2022, the Company's board of directors resolved to purchase treasury stock based on theprovisions of Article 156 of the Companies Act, applied mutatis mutandis to Article 165, Paragraph 3 of the same Act.
(1) Reasons for the purchase of treasury stock
As part of the Company's efforts to improve capital efficiency from both business and financial perspectives under the
Medium-term Management Plan ACE 2.0, which started in fiscal 2021, the Company determined to acquire treasury stock.
This aims to enhance its corporate value through greater capital efficiency as a result of comprehensive consideration of thecurrent valuation of its shares in the capital market, financial soundness and investment capacity for growth, and other factors.
(2) Details of shares to be purchased
a. Class of shares to be purchased
Common sharesb. Total number of shares that may be purchased 4,300,000 shares (maximum)(Equivalent to 3.57% of outstanding shares,
excluding treasury stock)c. Total value of shares that may be purchased
d. Purchase period

6 billion yen (maximum)
From February 10, 2022 to February 8, 2023

e. Purchase method

Market purchases(Cancellation of Treasury Stock)
At a meeting held February 9, 2022, the Company's board of directors resolved to cancel treasury stock based on theprovisions of Article 178 of the Companies Act.
a. Class of shares to be canceledb. Number of shares to be canceled

Common shares
3,500,000 shares(Equivalent to 2.81% of outstanding shares,
including treasury stock)c. Effective date of the cancellation

February 28, 2022

*Reference: Treasury stock held as of January 31, 2022
Total number of shares issued (excluding treasury stock)Total number of treasury stock

120,558,859 shares
3,849,426 shares- 16 -