FYE March 2017
Financial Highlights
NAGASE & CO., LTD.
May 2, 2017

Copyright © 2017 NAGASE & CO., LTD.

AgendaConsolidated Statements of Income

2N t SalesNetS l b
by RRegioni (D(Domestic,ti OOverseas))

3

Net Sales: Two-Year Comparison (by Segment)

4

Operating Income: Two-Year Comparison (by Segment)

5

Consolidated Balance Sheets

6

Consolidated Cash Flows7

FYE March 2018 Earnings Projections

8

Dividends

9

Copyright © 2017 NAGASE & CO., LTD.

Consolidated Statements of Income■Net sales: Lower, mainly due to the impact of the strong yen and a decrease in naphtha prices■Operating income: Lower, mainly due to ¥3.1 billion in expenses related to retirement benefit accounting actuarial losses(¥4.0 billion negative impact in prior year)(100 millions of yen)

16/03

17/03

ChangePublished
Forecast

Vs. PYAchievement

Net sales

7,421

7,223

△
△198

97%

7,350

98%

Gross profit

916

915

△1100%

923

99%<GP ratio>

12.4

12.7

+0.3%

－

12.6%

－

SG&A expenses

736

764

+28104%778－

Operating income

180150△2983%

145104%

Ordinary income

183

163

△2089%

160102%

Profit attributableto owners of theparent

123103△1984%

95109%

US$ Exchange rate
(period average)@120.1@108.3@108－@11.7 revaluation(Foreign exchange rate impact on17/03 net sales and operating income results)
Net sales ：- ¥46.8 billion (approx.)
Operating income ：- ¥1.7 billion (approx.)

Copyright © 2017 NAGASE & CO., LTD.

2Net Sales by Region (Domestic, Overseas)■Higher sales in Japan; lower sales overseas due to the impact of the strong yen
Domestic & Overseas Sales (100 millions of yen, %)Domestic(Left axis)

8,000

Overseas(Left axis)

Overseas Sales by Region (100 millions of yen, %)Oversales Net sales（Right axis）

Greater China

51.1%
48.9%

7,000

50%

4,000

3,791

3,500

161
139
320

6,000

40%
3,791
3 791

3,000

Americas

Europe

Other

3,530

156
119
295

(V:97%)(V:86%)(V:92%)

3,530

5,000

2,500

1,098
1,019

30%
,4,000(V:93%)
2 000
2,000

3,000
2 000
2,000

ASEAN

20%

3,630

3,693
10%

1,500

1,000

2,071

1,000

1,937
(V:94%)

500

00%
16/03

17/03

016/03Copyright © 2017 NAGASE & CO., LTD.

17/03

V:Vs 16/033

Net Sales: Two-Year Comparison (by Segment)■ Functional Materials: Lower segment sales, mainly due to a decrease in naphtha prices driving sales of coating raw materials and urethanematerials lower. At the same time, sales of plastic additives and silicone materials were strong in the Americas.
■ Advanced Materials & Processing: Lower segment sales. Despite higher performance in conductive materials, sales of plastic materials in Greater
China were lower, as were sales of plastic resins for packaging applications and digital print processing materials in Japan and overseas.
■ Automotive & Energy: Lower segment sales. Despite strong performance in the plastics business in Japan, lower naphtha prices drove sales downoverseas.

Net Sales by Segment (100 millions of yen)
Functional Materials

Advanced Materials & Processing

Electronics

Automotive & Energy

7 421
7,421
7,000

855

6 000
6,000

1 153
1,153

5,000

Life & Healthcare

Other

7,223
849
1,129

1,279

1,277

4,000
3,000

2,555

2,426

1,571

1,535,

16/03

17/03

2,000
1,000
0

Copyright © 2017 NAGASE & CO., LTD.

4

Operating income: Two-Year Comparison (by Segment)■Although profits in the Life & Healthcare segment were down due to lower sales of cosmetics and health foods, other segments reported higher profits,
mainlyi l dued to profitability
fi bili iimprovements andd cost reductiond i measures at manufacturing
fi subsidiaries.
b idi i
■Other/Corporate: Recorded ¥3.1 billion in expenses related to retirement benefit accounting actuarial losses (¥4.0 billion negative impact in prior year).
*Posted retirement benefit actuarial loss of ¥3.1 billion at end of prior period, after revising the discount rate to reflect low market interest rates (fullyamortized this year)

Net Sales by Segment (100 millions of yen)

Functional Materials

Advanced Materials & Processing

Automotive & EnergyLife & Healthcare

18019038
13Electronics
Other/Corporate

150
33
15140
62

63

90
49

50

4036(10)41- 20- 54(60)16/03

Copyright © 2017 NAGASE & CO., LTD.

17 /03
5

Consolidated Balance Sheets■Current assets increased, mainly due to increases in notes and accounts receivable■Non‐current assets increased,increased mainly due to increases in investments in securities (price increases for retained shares offset sales of somesecurities)■ Shareholders’ Equity Ratio up 1.2 point to 54.7％
AssetsLiabilities and Net Assets

16/03
Total current assets
Cash and time deposits
Notes and accounts receivable

17/03

3,123

3,212

432

398

1,963

2,068

(100 millions of yen)

16/03

Change+88 Total current liabilities

17/03

Change1,561

1,664+103‐ 34

Notes and accounts payable

9781,020+42+105

Short-term loans

341

316

‐24(Including current portion of long-termlong term loans)

Inventories

629

631+2Current portion of bonds－100+100

Other

97

114+16Other

241

327+85

1,997

2,095+98 Total long-term liabilities

768

690

‐77

Property plant and equipment
Property,664

676+11Long term loans
Long-term

231

200

‐3030

Intangible fixed assets

445

407

‐37Bonds

300

200

‐100

Investments, other assets

887

1,011+124

Net defined benefit liability

140

146+5+132

Other(Deferred tax liabilities
liabilities, etcetc.))96

143+47‐ 7 Total liabilities

2,329

2,355+26

Total net assets

2,791

2,951+160

Shareholders’equity

Total non-current assets

Investments in securities

813945

Other7466

Total assets

5,120

5,307

2,346

2,396+50

Accumulated other comprehensive income

393505+112

Net unrealized holding gain on securities

370

476+106

Translation adjustment

4431

‐12

Other‐ 21‐2+19

Non-controlling interests5149‐2+186 Total liabilities and net assets

5,120

5,307+186

Copyright © 2017 NAGASE & CO., LTD.

6

Consolidated Cash Flows■Cash and cash equivalents lower by ¥3.1 billion. Despite an increase of ¥14.5 billion in cash flows from operating activities (¥16.1 billion in
profit before income taxes), the company made ¥6.5 billion in cash outlays for investing activities (¥11.5 billion in purchases of property, plantand equipment) and ¥10.5 billion in cash outlays for financing activities (¥4.9 billion in net cash outlays for short-term loans, ¥4.0 billion in
dividend payments). *By region, cash decreased ¥4.4 billion in connection with increased working capital in Greater China.

Cash Flows(100 millions of yen)

17/03

Main breakdown

16/03

Net cash provided by (used in) operating activities

Profit before income taxes ＋161
Depreciation and amortization/amortization ofgoodwill ＋109
g+145
Increase in adjustments for retirement benefits＋32
Working capital - 77
Income tax paid - 77

+293

Net cash provided by (used in) investing activities

Purchases of property, plant and equipment ‐106
Purchases of intangible fixed assets included in otherassets ‐8-65
Purchases of investment in securities -18
Proceeds from sales of investments in securities
＋46

‐ 126

Net cash provided by (used in) financing activities

Sh t llong-term
Short,tloansl(net( t payments/proceeds)t /d ) -49-105 Cash dividends paid ‐ 40
Purchase of treasury stock -11‐ 128

EffEffects
off exchange
hrate changes
hon cashh anddcash equivalents-5‐ 15Net increase (decrease) in cash and cash equivalents- 31+23

Cash and cash equivalents at beginning of the year429

Japan 239 , Greater China 115 , ASEAN42 , Europe
18 , Americas 4 , Other 9405

Cash and cash equivalents, at end of the period

397Japan 254 , Greater China 70 , ASEAN 35 , Europe
18 , Americas 5 , Other 13429

Copyright © 2017 NAGASE & CO., LTD.

7

FYE March 2018 Earnings Projections■Net sales: Higher net sales
sales. Despite our projection of lower sales of liquid crystal‐related
crystal related products in our Electronics segment,segment othersegments are expected to report higher sales, including stronger performance of plastics in our Advanced Materials & Processing
segment.
■Operating income: Higher profits due to increased revenues. Further, amortization of retirement benefit actuarial losses are expected
to be ¥0.3
¥0 3 billion (representing a ¥2.8
¥2 8 billion positive impact on earnings compared to the prior fiscal year).
year)(100 millionsillioff yen))

17/03Actual

18/03Forecast

ChangeVs. PY

Net sales

7,223

7,320＋96101%

Operating income

150191＋40127%

Ordinary income

163

209＋45128%

P fit attributable
Profittt ib t bl tot
owners of the parent

103

125＋21121%

US$ Exchange rate
(period average)@108 3@108.3@108@¥0.3
revaluation―

Copyright © 2017 NAGASE & CO., LTD.

8Dividends■Current period: Annual ¥33 per share dividend (¥1 increase YoY),
YoY) representing a ¥16 interim and ¥17 year‐endyear end dividend■Next period: Annual ¥35 per share dividend (¥2 increase YoY), representing a ¥17 interim and ¥18 year‐end dividend（％）（％、yen）
y45

1.6

40

1.4

35

12
1.2

30

1.0

25
0.8
20
0.6

15
10

0.4

50.2

0
一株当たり配当金
Dividendper Share(left axis)(左メモリ)
配当性向
Payout Ratio（左メモリ）
左 axis)(left
DOE(右メモリ)
DOE (right axis)

08/03

09/03

10/03
0/03

11/03
/03

12/03
/03

13/03
3/03

14/03
/03

15/03
5/03

16/03
6/03

17/03
(Forecast)
（予定）

18/03
(Forecast)（予定）

1716162224262830

32

3335

21 8
21.8

35 4
35.4

27 3
27.3

22 1
22.1

36 0
36.0

23 4
23.4

30 5
30.5

33 7
33.7

33 0
33.0

40 4
40.4

35 3
35.3

1.08

1.07

1.08

1.42

1.52

1.52

1.50

1.44

1.46

1.48

1.50

0.0

*17/03 year-end dividend to be submitted for approval to general meeting of shareholders scheduled for June 2017

Copyright © 2017 NAGASE & CO., LTD.

9

http://www.nagase.co.jp/english/

These presentation materials contain forward-looking projections based on assumptions,forecasts, and plans as of May 2 , 2017. Actual earnings may differ from projections due torisks and uncertainties in the future global economy
economy, competitive landscapelandscape, currency
exchange rates, etc.
Copyright © 2017 NAGASE & CO., LTD.