The Fiscal Year ending March 2019（2018 April ~ 2019 March）
Business Results

Ichikawa Plant

May 17th 2019

Business Results for FY2019

Business Highlight for FY2019• The revenue of 22,975 million yen was the highest record（comparison with previous year +2,438 million
yen,+12%).
• As the prior cost increase for photosensitive materials production capacity expansion was well compensated by sales
increase and other cost improvement, the profit increased.
Operating profit was 1,559 million yen（comparison with year-on-year +258million yen,+20%）、Ordinary profit was
1,567million yen（ comparison with year-on-year +478million yen, +44%), Net profit was 1,171 million yen（ comparison
with year-on-year +307 million yen,+36％).
• Ordinary profit & Net profit was the highest record.

Comparison with
Year-on-Year
I/D
AmountI/D%Previous Year
Same Period
ResultOriginal
Forecast

Result20,53622,50022,975 +2,438

Operating Profit

1,300

1,400

1,559

Ordinary Profit

1,089

1,350

863

830

（Million Yen）

Revenue

Net Profit

Comparison with
Forecast
I/D
Amount
I/D%

+12％

+475

+2%

+258

+20％

+159

+11%

1,567

+478

+44％

+217

+16%

1,171

+307

+36％

+341

+41%

Net profit per stock

108.73104.57147.54

Dividend per stock

10.00

10.00

10.00

FX rate（Yen per USD）

¥111/$¥110/$¥110/$

3

The Business Result Summary of FY2019■Revenue✓ 22,975 million yen（comparison with year-on-year +2,438 million yen,+12%）✓ Photosensitive materials business for semiconductor & FPD（comparison with year-onyear +1,283 million yen, +11.3%）) and Chemicals business for electronic materials（
comparison with year-on-year +1,149 million yen,+12.2%））mainly contributed to
the revenue increase. Chemicals business for Aroma chemicals & Logistic also kept
good sales.
■Operating Profit✓ 1,559 million yen（comparison with year-on-year +258 million yen, +20%）✓ Although prior cost of production capacity expansion for photosensitive materials (laborcost, depreciation and etc. +776 million yen）increasing, the operating profit wasincreased as volume sales merit in increased demand for photosensitive materials &chemicals well compensated despite of the cost increase.
■Ordinary Profit✓ 1,567 million yen（comparison with year-on-year+478 million yen, +44%）✓ 162 million yen was counted as an extraordinary profit including exchange profit 33
million yen (comparison with year-on-year +97 million yen）).
■Net profit✓ 1,171 million yen（comparison with year-on-year +307 million yen, +36%）✓ Ordinary profit & Net profit was the highest record.

4

Revenue transition by quarterly• The quarterly average revenue was steadily increased to more than 57
million level as the Fiscal Year ending March 2019.
million yen

Revenue transition by quarterly

Average
4,545 million yen

Average
5,134 million yen

Average
5,734 million yen

5Operating profit, factors for increase/decrease• Revenue & Operating profit was increased in spite of the spending priorPrior investment cost (labor,
investment cost for capacity improvement
depreciation ) for capacity+885
Revenue
Increase
Impact+239△776

Operation
Improvement

ExpenseIncreased

improvement

・Cost increase alongwith sales increase
・Exchange fluctuation（¥111/$→¥110/$）

△89

1,300
Prev. Year
Result（million yen）

Others1,559This year
Result+259

6

Photosensitive Materials Segment• Good sales for semiconductor and FPD have been continued.
• The profit was decreased comparison with the same period last year
because of prior investment cost of production capability improvement.
Revenue・Operating Profit(million yen）

(million yen）
Revenue
Operating profit

Revenue：12,611 million yen（+1,283 million yen, +11.3% YOY）
• Good sales both for semiconductor and FPD
application.
• Volume business for EUV application has started• Sales for OLED was also good.

Operation profit：1,058 million yen（△216 million yen, △9.1％ YOY）
• In accordance with capacity improvement, labor
cost and depreciation increased 776 million yen,operation profit resulted in △216 million yen
YOY as minimizing the profit negative impact
due to better production output.

7

Chemicals Segment• Fine Chemicals business for Electronic industry under the good circumstance contributed to
the revenue increase• Aroma and Logistics business kept in good sales and resulted in good segment profit
improvement

Revenue： 10,605 million yen

Revenue・Operating Profit
million yen

million yen
Revenue
Ope. profit（ +1,149 million, +12.2% YOY）

• Ultra high purity solvent sales forelectric business continue to increase,as shifting high value product portfolio• Aroma Chemicals kept in sales growth• Logistic business also kept high tankutilization rate.
Operating profit：500milion yen（+475 million yen,+20.1 times YOY）

• Revenue increase contributed to the
profit improvement

8Profit & Loss Statement• Revenue 22,975 milion,+2,438 million +11.9％ YOY• Gross profit resulted in +435 million YOY,+10.6% YOY as absorbing prior cost for
Photosensitive business capacity improvement• Ordinary profit +478 million,+43.9% YOY due to mainly FX gain
（Million yen）

FY2018FY2019I/D AMTI/D %Revenue

20,53622,975

2,438

11.9%

COGS

16,435

18,438

2,002

12.2%

Gross Profit

4,100

4,536

435

10.6%

2,800

2,976

176

6.3%

1,300

1,559

258

19.9%

Non-Op profit

64

162

97

250%

Non-Op Exp.

276

154

△122

△44.2%

Ordinary profit

1,089

1,567

478

43.9%

Extra-ord. P&L

114

△56

△171

―

Profit before Tax

1,203

1,511

307

25.5%

Tax

340

340

△0

△0%

Net profit

863

1,171

307

35.7%

Selling Exp.
Ope. Profit［Gross profit +435］
After absorbing capacity
improvement cost, resulted inbetter profit［Non-Op profit +97,
Non-Op Exp. △122］
FX gain+33,
Insurance receieved+47［Extra-ord. P&L △171］
Due to gain on sales of fixed
assets asset in FY20189Balance Sheets• With capital investment for Photosensitive materials, tangible assets+1,981million yen, cash +2,886 million yen.
• Interest-bearing debt +3,524 million yen, Others (facility account payable etc.)+1,932 million yen.
• As net profit was increased in this year, shareholder’s equity was increased +1,091 million yen.
（million yen）
Current assets
Cash
Accounts receivable
Inventories
othersFixed assets
tangible assets
Intangible assets
Inv.& other assets
Assets total
Liabilities
accounts payableinterest-bearing debt
othersNet assets
Shareholder’s equity
valuation/translationdifference
Liabilities & Net
Assets Total

2018.3end
12,617
2,525
3,695
6,108
287
17,511
16,585331
595
30,12822,3452,872
14,460
5,012
7,783
7,738

2019.3end
17,228
5,412
4,314
6,822
679
19,637
18,566417
653
36,86528,024
3,094
17,984
6,945
8,841
8,830

I/D amt.
4,611
2,886
619
713
391
2,125
1,981
86
58
6,737
5,679
222
3,524
1,932
1,057
1,091

44

11

△33

30,12836,865

6,737［cash ＋2,886］
Increased by capital spending
payment preparations temporarily,
under the influence of end ofmonth holiday［Accounts receivable ＋619,
Inventories +713］
Working capital increased alongwith sales increase［tangible assets+1,981、
interest-bearing debt

+3,524,others +1,932］
Increased for photosensitive
materials of capacity expansion
investment［equity ratio］
24.0%（YOY △1.8pt）

10Statement of Cash Flows• CF of operating activities：2,097 million yen, Due to the increased sales, Sales credit and Inventories increased.
• CF of investing activities：△2,499 million yen, Due to the execution of capital investment, the expenses increased.
• CF of financing activities：3,268 million yen, Fund preparations for the future payment.
(million yen)

2018.3rd

2019.3rd

2,327

2,097

△229

Profit before income taxes

1,203

1,511

+307

Depreciation

1,687

1,944

+256

△512

△619

△107

△219

△713

△494

687

222

△465

△520

△247

+273

CF of investing activities△880△2,499△1,619

Free ・Cash Flows

1,446

△401

△1,848

CF of financing activities

△761

3,268

4,030

Effect of exchange rate change on
cash and cash equivalents

△25

20

+46

659

2,886

+2,227

2,113

5,000

+2,886

CF of operating activities

Increase (decrease) in
account receivable
Increase (decrease) ininventories
Increase (decrease) in
accounts payable
Others

Net increase (decrease) in cash
and cash equivalents
Cash and cash equivalents at endof period

Increase11

2020 March ending Projection

2020.3 ending Projection• Expecting production & sales increase after production capacity improvement in last 2 years• Better profit in accordance with sales increase• Assumed FX rate ¥107/$• Increase dividend to yearly 20yen as double from FY2019

2019.3Ending result（million yen）

2020.3Endingprojection

Comparison with
Last year result vs projection
I/D Amt

I/D %22,97525,5002,525+11.0%

Operating profit

1,559

1,800

241

+15.5%

Ordinary profit

1,567

1,700

133

+8.9%

Net profit

1,171

1,600

429

+36.6%

Earnings per share

147.54201.58Dividend per share

10.00

20.00

FX rate（USD）¥110/$¥107/$

Revenue13

Capital Investment & Depreciation History
million yen

Capital Investment & Depreciation

Increase by new
productionbuilding
construction

Capital Investment
Depreciation（見込）Projection

14

Future Outlook

Business Environment（2018.8 Medium-term management plan「TGC300」）
Market Trend✓ Usage of Electronic Device in Daily life continue toexpand( 5G, big data, AI, IoT, EV etc）
✓ In line with minimizing device structure and improving
performance, high purity and functional materials arebeing required more in the market.

Customer’s Requirements✓More requirements for Ultra high purified materials especiallyfor EUV application✓Few technology companies can meet small lot size withchallenging production process which is getting common in theadvanced technology market

Challenge for market demand✓Full utilize our experience for distillation in 70
years and photosensitive materials in 40 years
for customer’s quality requirement

Measurements• Development ofadvanced purification

technology• Secure production
capacity• Productivity
improvement

16

TGC300 Concept & VisionHigh Purity Chemical
Synthesis & Refining
Technology
Innovation

Enhancement for
stable supply system
to satisfy customer’squality requirement

Productivity
Improvement◼ Vision of TGC300
Sincerely proving solution for customer’s agenda and technical issue by unique approach,become world #1 “DANTOTSU”(ultra outstanding ) company in high quality and productivity.

17

TGC300 progress• Medium-term management plan「TGC300」 is on going as weplanedordinary profit %• 1st year resulted as beyond plan
Revenue mio yen（Revenue+2％、ordinary profit+16％）

Ordinary profit mio yen• For the supply increase ofphotosensitive materials, now
proceeding of capital improvement
as planed✓

Improvement of existing facility→Completed✓

New plant building→to be completed summer in
2020• Medium-term management plan is on
going as we planed(Plan)(Plan)

Medium-term management plan

18

Semiconductor Market Development & Projection• Semiconductor market is going bottom out• Process material demand tend to expand as following semiconductor production investment• Keep solid demand for products even in Semiconductor market slowing downWorld IC Market Sales
2017 result 21.6% growth
2018 result 13.7% growth（WSTS ）2019 projection 2.6% growth（WSTS 2018.8）
2019 projection -3% growth（WSTS 2019.2）
2020→2030
Diversification for IC
application make about
300Billion$ growth
2010→2020
about
200Billion$growth

CAGR 7%

CAGR 5-6%

CAGR 4%

Source: WSTS & Fuji Chimera Research Institute, Inc

Projection

19Lithography Technology Down Sizing• Semiconductor Node (Line Width) continues to be down size to 7 nm as mas production
at Year 2018
• Suppose to be down size to 2 nm level in 2025
• In accordance with line width down size, 3D structure, severe quality control forprocess materials, surging need more high purity photosensitive materials
Sub 3nm
Next
generation
EUV?

14-10nmArF Multi
Patterning
20nm
ArF Double
Patterning

5nm

3nm

2nm

14Å

7nm
10nm
14nm

20nm

7nm EUV
3D Structure Device

28nm
2011

2013

2015

2017

2019

2021

2023

2025

年
Source : IMEC

Outlooks: Photosensitive materials Application, Wave length and Line Width• Photosensitive material both legend (mainly FPD application) and advanced generation (mainly Semiconductor

application) still keep strong demand from the market• Started mass production supply for EUV materials in FY2019• TGC continue to improve quality of photosensitive materials and diversifying product line up to satisfy customer’s
needs
FPD

g＋ｈ＋
ｉline

I lineSemiconductor

G lineI line線

KrF

ArF

Line
width

～
～
～700nm ～200nm ～110nm ～65nm
2,000nm 1,000nm

ArF
Immersion

～45nm

ArF
MP

ArF
DP

～22nm

EUV
～7nm

～2.1nm～？

Application

TV andgeneraldisplay

Advanced
Panel

Market

IGBT、LCD Driver、
LED

Emerging
countries’
demandSmart phone
Gradually
andhigh
ExpandingshrinkresolutionTV

Gradually
expanding

DRAM / NAND FLASH Memory

Next Gen. DRAM

Advanced logic LSI

Next Gen. Logic LSI

stableexpanding mass production

Underdevelopment

Beyond2025？

TGC Business area

21

FPD market development & projection
Demand for FPD photoresists continues to expand, driven by expanding FPD production in China.
The shift to higher resolution screen is supporting a significant increase in demand for high-grade
photosensitive materials.
Total FPD(Million m2)
Demand outlook for FPDs (surface area) 2015→2024： x1.4
CAGR: 3.6%
→Projection

LCD（4K&8K）
2016→2025：x3.8
CAGR：14.2%
OLED
2016→2025：x6.5
CAGR: 20.5%

Source：IHS

22

Key Strategy：Photosensitive Materials Capacity Up Investment⚫ On going capacity up project to meet continuing increased demand from themarket⚫ Completed 1st phase as PAC(FPD) and advanced polymer production capacity up as well
as 2nd phase as PAG (advanced materials)⚫ On going 3rd phase for new production as to be completed in 2020.

Photosensitive
Materials for
FPD

Advancedpolymer
Advanced
Photosensitive
Materials
New Plant（New Building）

Current

FY2018.3
2 nd HFY2019.3
1st H
2 nd H

Construction

Qualification& Training

Full
Operation

Construction

Qualification& Training

Full
Operation

Const.

FY2020.3
1st H
2 nd H

Qualification& Training

FY2021.3
1st H
2 nd H

Full
Operation

Design & Construction

Qualification &Training
Full

Operation

23

News Clipping for completion of capacity up in the existing production building•Advanced materials (PAG）
capacity up completed by Feb
2019• Plan to ship products in 2nd Halfof FY2019 after customer’squalification process.

Chemical News on May 8,201924

Chemical business: Electronic Materials Application & Aroma Application• Electronic material (solvent) for photoresist, semiconductor process
and other electronic device production have good sales developmentwith the operation rate improvement at each plant• Secure additional production capacity by productivity improvement
activities for future demand

Aroma Plant

Ichikawa Plant

Awaji Plant• Stable business growth in
Flavor & Flagrant demand
increase• Suitable for big lot size

• Mother plant• Produce both Aroma
materials and Electronicmaterials• Applicable for small lot size
production• Supply mainly for west
Japan customers• Mainly producing electronicmaterials as big lot size

25

Chemical business: Aroma materials• Flavor and Flagrance market growing in CAGR 4.3％、continuing the same level as growth level• 70% of Global Market is occupied by top 7 leading companies

mio us $Flavor and Flagrance market

2017 Global Market share2000～2017
CAGR：4.3％

出展：Leffingwell & Associates

26Chemical business: Logistic Chemical Tank terminal•Enhanced customer satisfaction as advanced chemical company standard QC and analytical technology•Takahama Tank Terminal keep high operation rate as the biggest chemical tank terminal in Tokyo bay area

Over view of Takahama Tank Terminal
Biggest Chemical Tank Terminal Tokyo
gulf area

New QC and Analytical Lab（completion in 2018 May）
Improved QC ability and service

News clipping as Nikkei Sangyo on Jan 29 201927

独創的な視点で世界へ
Individual Development, to the global Chemical（見通しに関する注意事項）
本資料の業績予想は、現時点において見積もられた見通しであり、これまでに入手可能な情報から得られた判断に基づいております。
従いまして、実際の業績は、様々な要因やリスクにより、この業績予想とは大きく異なる結果となる可能性があり、いかなる確約や保証を行うものではありません。

Appendix

資本政策・株主還元• 2020.3期は、年間配当20円へ増配を計画。
• 株主還元方針に変更なし。
安定配当を基本とするものの、成長性、財務バランス等を総合的に勘案し決定する。

（年度）
（予想）

30