Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2023
<Under Japanese GAAP>

August 4, 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 (Prime Market)
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): August 10, 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 First Quarter of the Fiscal Year Ending March 31, 2023
(April 1, 2021 to June 30, 2022)(1) Consolidated Operating Results
Net sales
For the first quarter ended
June 30, 2022
June 30, 2021

Millions of yen

Gross profit%

219,571
184,389

19.1

Millions of yen

36.9(Note) Comprehensive income

39,904
34,589Operating income
%

15.4
32.7

Millions of yen

Profit attributable toowners of the parent

Ordinary income%

10,8719,738(% = year-on-year change)

11.6

Millions of yen

11,542
10,660

165.1

%

8.3

Millions of yen

7,969
7,169

151.6

First quarter ended June 30, 2022: ¥17,047 million (57.6%)
First quarter ended June 30, 2021: ¥10,814 million (8.7% decrease)
Earnings per share

For the first quarter ended
June 30, 2022
June 30, 2021

Earnings per share (diluted)
Yen

Yen

66.69
58.37

−
−

(2) Consolidated Financial Position
Total assets

Net assets

Millions of yen

June 30, 2022
March 31, 2022

Millions of yen

782,013739,720(Reference) Equity capital

Shareholders’equity ratio

Net assets per share%

366,387
355,092

Yen

45.4
46.5

2,980.41
2,868.22

As of June 30, 2022: ¥ 354,673 million
As of March 31, 2022: ¥ 344,261 million

2. Dividends
1Q
For the year ended (or ending)March 2022
March 2023
March 2023 (forecast)

2Q
Yen

−
−

(Note) Revisions to the latest dividends forecast: No

Annual dividends per share
3Q
Fiscal year end
Yen

24.00
30.00

Yen

Yen

Annual
Yen

−

30.00

54.00

−

30.00

60.00

%

11.2

5.3

3. Consolidated Earnings Forecast for the Fiscal Year Ending March 31, 2023
(April 1, 2022 to March 31, 2023)(% = year-on-year change)

Gross profit
Millions of yen

Full fiscal year

159,000

Operating income%

14.0

Millions of yen

38,000

Profit attributable toowners of the parent

Ordinary income%

7.8

Millions of yen

39,000%

6.9

Millions of yen

28,500Earnings per
share

%

9.9

Yen

241.35(Note) Revisions to the latest consolidated earnings forecast: No* 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.10 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: No
ii. Changes in items other than (i) above: Noiii. Changes in accounting estimates: No
iv. Restatement of prior period financial statements after error corrections: No(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)June 30, 2022
120,908,285 shares March 31, 2022
120,908,285 shares
ii.

iii.

Number of treasury stock as of the fiscal period end
June 30, 2022
1,906,567 shares

March 31, 2022

Average number of shares during the period
June 30, 2022
119,507,343 shares

June 30, 2021

881,767 shares

122,837,754 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 to Consolidated
Earnings Forecasts, on P.5 of this document.

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2023

Attachments
1.

Qualitative Information

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

5(3) Qualitative Information Related to Consolidated Earnings Forecasts

5

2． Quarterly Consolidated Financial Statements and Notes

6(1) Quarterly Consolidated Balance Sheets

6(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive Income

8

Quarterly Consolidated Statements of Income

8

Quarterly Consolidated Statements of Comprehensive Income

9(3) Notes Related to Quarterly Consolidated Financial Statements

10(Assumption for Going Concern)

10(Significant Fluctuations in Shareholders’ Equity)

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

10(Segment Information, etc.)

11

1

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2023

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

General Summary of Results

Despite the prolonged impact of the COVID-19 pandemic during the first quarter of the current consolidated fiscal year, theglobal economy showed signs of improvement toward socioeconomic normalization in response to a recovery in personal
consumption and other factors. However, the outlook remains uncertain due to food shortages caused by the protracted
situation in Ukraine and continued high prices for resources, as well as ongoing disruptions in the global supply chain due tothe Shanghai lockdowns, etc. Further, concerns are rising regarding a recession caused by monetary tightening in response toaccelerating inflation.
As an overview of the regions in which our group does business, in Greater China, the economy stagnated for a period of time
due to the lockdowns and a Zero Covid policy. However, consumer spending and manufacturing production have begun torecover since the easing of restrictions. In the Americas, a possible economic slowdown has emerged due to continued highresource prices and repeated interest rate hikes due to concerns about inflation caused by labor shortages and rising wages.
Despite shades of gray from country to country, economic activity resumed in ASEAN and is recovering. In Japan, there areconcerns of an economic slowdown due to rising energy and raw materials prices, as well as the impact of a weak yen on
increasing consumer prices. However, COVID-19-related restrictions on activities have been eased and economic activity isnormalizing. More recently, infections have been on the rise due to variant strains, but we believe the impact on the economy
will be limited in nature.
Under these conditions, NAGASE Group performance was favorable, driven by growth in food-related and semiconductorrelated products, business which are focus areas of our medium-term management plan. Further, the depreciation of the yen has
had an upward impact on group profit.
In this environment, earnings for the cumulative consolidated first quarter of the current fiscal year are as follows.
(Millions of yen)Three-monthThree-month

period ended
June 30, 2021

period ended
June 30, 2022

ChangeChange (%)

Net sales

184,389

219,571

35,182

19.1

Gross profit

34,58939,904

5,314

15.4

Operating income

9,738

10,871

1,132

11.6

Ordinary income

10,660

11,542881

8.3

Profit before income taxes
Profit attributable to owners

10,881

11,438

557

5.1

7,169
7,969
799
11.2
of the parent
・ Record-high profits for the first quarter of the current consolidated fiscal year in all stages of profit below gross profit for
the NAGASE Group.
・ Despite lower profit in the Advanced Materials & Processing segment, profit increased mainly due to the Prinova Groupdriving significant performance growth in the Life & Healthcare Segment, as well as strong performance in the Functional
Materials segment. See b. Segment Summary for more.
・ As a result of the preceding, profit attributable to owners of the parent increased ¥700 million to ¥7.9 billion.

2

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2023b.

Segment Summary

The following describes performance by segment.
Functional Materials(Millions of yen)Three-month
period ended

Three-month
period ended

June 30, 2021

June 30, 2022

ChangeChange (%)

Net sales

24,63428,654

4,020

16.3

Gross profit

4,868

5,816

948

19.5

Operating income

1,981

2,388

406

20.5

・ Sales increased for coating and urethane raw materials, due in part to soaring market prices and the weakening of the yen
・ Sales increased for raw materials for industrial oil solutions and resins
・ Sales increased for electronics chemicals to the electronics industry, including semiconductor-related products
・ Operating income increased due to an increase in gross profit
Advanced Materials & Processing(Millions of yen)Three-monthThree-month

period ended
June 30, 2021

period ended
June 30, 2022

ChangeChange (%)

Net sales

61,79965,1313,331

5.4

Gross profit

8,269

8,161

(107)

(1.3)

Operating income

3,299

2,599

(700)

(21.2)・ Despite the positive impact of the weak yen on sales, profitability decreased for resin sales to the office equipment,
appliance, and video game device market due to a reactionary decline stemming from increased profit ratios in connection
with soaring market conditions in the year-ago period
・ Sales decreased for dyes and additives
・ Sales increased for resins for industrial and packaging applications
・ Sales of conductive materials were strong; however, sales of digital print processing materials were slow
・ Operating income decreased due to a decrease in gross profit
Electronics & Energy(Millions of yen)Three-monthThree-month

period ended
June 30, 2021

period ended
June 30, 2022

ChangeChange (%)

Net sales

29,94933,933

3,984

13.3

Gross profit

7,239

7,893

654

9.0

Operating income

2,554

2,617

62

2.5

・ Sales increased for products related to precision processing materials for semiconductors
・ Sales of display materials were slow, although profitability improved due to the weak yen, etc.
・ Sales of formulated epoxy resins were strong for semiconductor applications, but slow for mobile devices
・ Sales of photolithography materials for displays were firm, but profitability was lower due to soaring raw materials prices,etc.
・ Operating income increased due to an increase in gross profit

3

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2023

Mobility(Millions of yen)Three-month
period ended

Three-month
period ended

June 30, 2021

June 30, 2022

ChangeChange (%)

Net sales

23,22527,018

3,792

16.3

Gross profit

2,999

3,215

215

7.2

994

932

(61)

(6.2)

Operating income

・ Sales increased for resins due to the weak yen, etc., despite lower automobile production
・ Sales increased for functional materials and functional components for interior and exterior fittings and electrification
・ Although gross profit increased, operating income declined due to higher selling, general and administrative expenses
Life & Healthcare(Millions of yen)Three-month
period ended

Three-month
period ended

June 30, 2021

June 30, 2022

ChangeChange (%)

Net sales

44,71564,81420,09945.0

Gross profit

11,15014,796

3,645

32.7

Operating income

2,713

4,144

1,431

52.8

・ Materials sales, manufacturing, and processing in the nutrition-related business performed well・ Sales increased for food materials, primarily TREHA™
・ Sales of cosmetics materials, primarily for AA2G™ , decreased due to lower demand, mainly overseas
・ Sales increased for pharmaceutical raw materials
・ 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 First Quarter of the Fiscal Year Ending March 31, 2023

(2) Review of Financial Position(Millions of yen)

Prior Consolidated
Fiscal Year
(March 31, 2022)

First Quarter, Current
Consolidated
Fiscal Year
(June 30, 2022)

Current assets

514,286

552,789

38,502

7.5

Non-current assets

225,434

229,224

3,789

1.7

Net assets

739,720782,013

42,292

5.7

Liabilities

384,628

415,625

30,997

8.1

Net assets

355,092

366,387

11,295

3.2

46.5

45.4

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

ChangeChange (%)

・ Current assets increased mainly due to an increase in inventories and accounts receivable
・ Non-current assets increased slightly due to an increase in property, plant and equipment and intangible fixed assets, despite
lower fair values of investments in securities
・ Liabilities increased mainly due to an increase in commercial paper and short-term loans
・ Net assets increased mainly 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 45.4%, down 1.1 points compared to 46.5% from the endof the prior consolidated fiscal year(3) Qualitative Information Related to Consolidated Earnings Forecasts

The Company has made no changes to the full-year consolidated earnings forecasts announced on May 10, 2022.

5

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2023

2. Quarterly Consolidated Financial Statements(1) Quarterly Consolidated Balance Sheets
Prior Consolidated Fiscal Year
(March 31, 2022)
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
Long-term loans receivable
Retirement benefit asset
Deferred tax assets
Other
Less allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

6(Millions of yen)First Quarter, Current
Consolidated Fiscal Year
(June 30, 2022)

54,211
289,862
142,5902,401
12,533
13,935(1,248)514,286

52,152
303,861
160,643
2,516
14,25920,554(1,198)552,789

72,55475,72929,492
5,912
29,66465,07029,986
5,518
31,827
67,33375,600
24
3,139
3,572
5,583
(112)
87,809225,434
739,72073,757
21
3,194
3,627
5,673
(112)
86,162229,224
782,013

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2023

Prior Consolidated Fiscal Year
(March 31, 2022)
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

7(Millions of yen)First Quarter, Current
Consolidated Fiscal Year
(June 30, 2022)

149,036
73,121
8,752
25,00010,000
7,100
7,648
497
26,678307,836

151,875
79,517
8,329
49,000
－
3,663
4,140
156
29,903
326,586

20,00028,244
12,31013,2382,998
76,791
384,628

30,00028,87911,70813,443
5,007
89,038415,625

9,699
10,639280,015(1,534)
298,820

9,699
10,639284,149(3,400)301,089

31,732
178
13,690(161)
45,441
10,830355,092
739,720

30,147512
23,043(118)
53,584
11,714366,387
782,013

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2023

(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive
Income(Quarterly Consolidated Statements of Income)Three-month periods ended June 30, 2022 and 2021

(Millions of yen)Three-month period ended
June 30, 2021
(April 1, 2021 - June 30, 2021)

Three-month period ended
June 30, 2022
(April 1, 2022 - June 30, 2022)

184,389
149,799
34,58924,851
9,738

219,571
179,666
39,90429,033
10,871

41
576
71
－
531
91
1,312

18
672
62
83
328
186
1,352

290
4
95
390
10,660

490
－
191
681
11,542

2
571
178
752

123
43
－
166

155
242
－
3
130
531
10,881
3,207
7,674
504
7,169

3
179
7
79
－
270
11,438
3,194
8,244
275
7,969

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 gains 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
Other
Total extraordinary gains
Extraordinary losses
Loss on sales of non-current assets
Loss on disposal of non-current assets
Loss on sales of investment securities
Loss on valuation of investment securities
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

8

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2023

(Quarterly Consolidated Statements of Comprehensive Income)Three-month periods ended June 30, 2022 and 2021

(Millions of yen)Three-month period ended
June 30, 2021
(April 1, 2021 - June 30, 2021)

Three-month period ended
June 30, 2022
(April 1, 2022 - June 30, 2022)

7,674

8,244

(1,840)
(16)
5,034
(70)

(1,582)
333
9,542
43

33

466

3,140
10,814

8,802
17,047

9,978
835

16,112
934

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

9

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2023

(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 9, 2022, the Company acquired 1,024,800
shares of treasury stock in the first quarter of the current consolidated fiscal year. As a result, treasury stock increased by ¥1,866
million, with treasury stock holdings of ¥3,400 million as of the end of the consolidated first 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 first quarter, and multiplying profit before income taxes forthe first 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, thisshall 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 tax.

10

NAGASE & CO., LTD. (8012)
Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2023

(Segment Information, etc.)
Segment Information
I Three-month period ended June 30, 2021 (consolidated)
1. Information related to net sales and income (loss) by reportable segment
Reportable Segments
Advanced
Functional
Electronics &Life &
Materials &Mobility
EnergyMaterials
Healthcare
Processing

Total(Millions of yen)
Others(Note) 1

Total

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

Net sales
Sales tocustomers
Intersegment
sales/transfers

24,634

61,79929,94923,22544,715

184,32464

184,389--

184,389

137

171

520

643

98

1,571

854

2,426

-

(2,426)-

Total

24,771

61,97130,46923,86944,814

185,896918

186,815-(2,426)

184,389

Segment income(loss)

1,981

3,299

2,554

994

2,713

11,543

8

11,551(1,948)

134

9,738

(Note) 1.

“Others” is a business segment consisting of businesses not included in Reportable Segments, and includes information
processing services and professional services.

2.
3.

Corporate segment income (loss) represents expenses not allocated to Reportable Segments or Others.
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 Three-month period ended June 30, 2022 (consolidated)
1. Information related to net sales and income (loss) by reportable segment
Reportable Segments
Advanced
Functional
Electronics &Life &
Materials &Mobility
EnergyMaterials
Healthcare
Processing

Total(Millions of yen)
Others(Note) 1

Total

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

Net sales
Sales tocustomers
Intersegment
sales/transfers

28,654

65,13133,93327,01864,814

219,55318

219,571--219,571

283

198

284

386

128

1,282

1,372

2,654

-

(2,654)-

Total

28,93765,32934,21827,40564,943

220,835

1,391

222,226-(2,654)

219,571

Segment income(loss)

2,388

2,599

2,617

932

4,144

12,682(13)

12,668(1,982)

185

10,871(Note) 1.

“Others” is a business segment consisting of businesses not included in Reportable Segments, and includes information2.

processing services and professional services.
Corporate segment income (loss) represents expenses not allocated to Reportable Segments or Others.

3.
4.

Adjustments are eliminations of intersegment transactions.
The sum of segment income (loss) Total, Corporate, and Adjustments is equivalent to operating income as presented in“Consolidated”.

11