Consolidated Financial Results for the Year Ended March 31, 2019
(JPGAAP)May 15, 2019

Stock Exchange: Tokyo
Name of listed company: Nissan Chemical Corporation
URL: http://www.nissanchem.co.jp/
Code Number: 4021
Representative: Kojiro Kinoshita, President
Inquiry to: Nobuhiro Arita, Associate Executive Officer and Deputy Head of Finance and Accounting Department Tel. +81 3 4463 8404
Scheduled dividend payment date : June 27, 2019
Scheduled date of annual shareholders' meeting: June 26, 2019
Scheduled date of submitting the Annual Securities Report : June 26, 2019
Supplemental information: Yes
Financial results meeting: Yes (for institutional investors and analysts)(Amounts rounded down to the nearest million yen)

1. Consolidated Financial Results for the Year Ended March 31, 2019 (From April 1, 2018 to March 31, 2019)(1) Consolidated Operating Results(% indicates the rate of increase/decrease year on year)

OperatingincomeNet salesYear ended March 31, 2019Year ended March 31, 2018
(Note) Comprehensive income:Ordinary
incomeNet income attributable toowners of parent

Million yen%

Million yen%

Million yen%

Million yen%

204,896

6.0

37,091

6.0

39,098

7.9

29,372

8.2

193,389

7.3

34,988

11.3

36,235

14.3

27,14213.0

Year ended March 31, 2019

: 26,203 million yen, (14.8%)

Year ended March 31, 2018

: 30,763 million yen, 29.4%

Basic earnings
per share
Yen

Year ended March 31, 2019Year ended March 31, 2018
(Reference) Equity in earnings of affiliates

Yen

197.67－180.30－

Ratio of ordinary
income tototal assets

Ratio ofnet income toshareholders' equity

Diluted net income
per share: Year ended March 31, 2019

: 970 million yen: Year ended March 31, 2018

: 1,324 million yen

Ratio of operating
income tonet sales

%

%

%

16.6

15.9

18.1

16.1

15.1

18.1

(2) Consolidated Financial Position
Total assets

As of March 31, 2019
As of March 31, 2018
(Reference) Shareholders' equity:

Net assets

Net assets
per share

Equity ratio

Million yen

Million yen%

Yen

246,990

182,07473.0

1,220.35

246,040

176,36471.0

1,168.07

As of March 31, 2019 : 180,345 million yen
As of March 31, 2018 : 174,586 million yen(3) Consolidated Cash Flows
Cash flows fromoperating activities

Cash flows frominvesting activities

Cash and cash
equivalents at
end of period

Cash flows fromfinancing activities

Million yen

Million yen

Million yen

Million yen

Year ended March 31, 2019

32,070(10,884)(22,563)

36,183

Year ended March 31, 2018

37,691(15,244)(20,268)

37,702

Total
cash dividends(annual)Ratio of
Dividend
dividend
payoutto net assets
ratio(consolidated) (consolidated)

2. Cash Dividends
Cash dividends per shareFirst
quarter

SecondquarterYen

Thirdquarter

Yen

Year-end

Yen

AnnualYen

YenMillion yen%%

Year ended March 31, 2018

－

32.00

－

36.00

68.00

10,195

37.7

6.1

Year ended March 31, 2019

－

40.00

－

42.00

82.00

12,14641.5

6.9

Year ending March 31, 2020
(Forecast)

－

42.00

－

46.00

88.00

42.8

3. Forecast of Consolidated Financial Results for the Fiscal Year Ending March 31, 2020 (From April 1, 2019 to March 31, 2020)(% indicates the rate of increase/decrease against the same period of the previous year)
OperatingincomeNet sales

Ordinary
incomeNet income attributable toowners of parent

Basic earnings
per share

Million yen%

Million yen%

Million yen%

Million yen%

Yen

Six months
ending September 30, 2020

99,0001.0

17,800(8.2)

18,400(10.7)

13,700(11.1)

93.25

Year ending March 31, 2020

210,500

2.7

38,7004.3

40,2002.8

30,2002.8

205.83

4. Notes(1) Changes in significant consolidated subsidiaries(Changes in specified subsidiaries involving changes in scope of consolidation): None(2) Changes of accounting policies and accounting estimates, and restatement
1. Changes of accounting policies due to revisions of accounting standards: None2. Changes of accounting policies other than the above: None3. Changes in accounting estimates: None4. Restatements: None(3) Number of shares outstanding (common shares)
1. Number of shares outstanding (including treasury shares)
As of March 31, 2019

: 149,000,000 shares

As of March 31, 2018

: 151,000,000 shares

2. Number of treasury shares
As of March 31, 2019

: 1,217,872 shares

As of March 31, 2018

: 1,534,562 shares

3. Average number of shares outstanding over the year
As of March 31, 2019

:148,593,042 shares

As of March 31, 2018

:150,542,352 shares* Presentation regarding implementation status of audit proceduresThis financial release is not subject to audit procedures based on Financial Instruments and Exchange Law in Japan.
Audit procedures of financial statements based on Financial Instruments and Exchange have not been completed at the time of disclosure.
* Explanations regarding appropriate use of business forecasts and other special notes
The business forecast contained in this report is based on information available at the time of disclosure.
Actual operating results may differ materially from the forecast due to various factors.
The prerequisite information of actual forecast and other items are on page 3.
For supplemental information, please refer to our website.
Financial results audio webcast will be released on our website as well.

Table of Contents for Attached Materials

1. Analysis of Business Performances and Financial Position ........................................................................................................... 2(1) Analysis of Business Performance ........................................................................................................................................... 2(2) Analysis of Financial Position ................................................................................................................................................... 4(3) Basic Policy on Distribution of Earnings and Dividends for current and next term ................................................................... 5

2. Management Policy ....................................................................................................................................................................... 6(1) Basic Management Policy ........................................................................................................................................................ 6(2) Target Management Indicator .................................................................................................................................................. 6(3) Mid-and Long-term Management Strategies and Issues to be addressed ............................................................................... 6

3. Basic Approach to the Selection of Accounting Standards .............................................................................................................. 8

4. Consolidated Financial Statements ............................................................................................................................................... 9(1) Consolidated Balance Sheets .................................................................................................................................................. 9(2) Consolidated Statements of Income and Statements of Comprehensive Income .................................................................. 11(3) Consolidated Statements of Changes in Net Assets .............................................................................................................. 13(4) Consolidated Statements of Cash Flows ............................................................................................................................... 15(5) Notes to Consolidated Financial Statements ......................................................................................................................... 16(Going Concern Assumption) ........................................................................................................................................... 16(Reclassifications) ............................................................................................................................................................ 16(Segment and Related Information) .................................................................................................................................. 16(Per Share Information) .................................................................................................................................................... 19(Significant Subsequent Events) ....................................................................................................................................... 19

1

1. Analysis of Business Performance and Financial Position(1) Analysis of Business Performance
The domestic economy for the current consolidated fiscal year (April 1, 2018 to March 31, 2019) continued to recovermoderately as corporate earnings and consumer spending improved. However, exports tended to decline in the second
half of the fiscal year due to an economic slowdown in China, Europe, and other countries. Under such circumstance, in
the Chemicals Segment, sales of Basic Chemicals increased, while Fine Chemicals decreased. In the Performance
Materials Segment, Display Materials and Semiconductor Materials performed well. In the Agricultural Chemicals
Segment, shipments of Fluralaner (active ingredients for veterinary pharmaceuticals) increased. In the Pharmaceuticals
Segment, sales of "LIVALO" (anti-cholesterol drug) decreased.
As a result, the Company’s results for the current fiscal year were as follows. Operating and ordinary income recorded
record highs for the fifth consecutive year and net income attributable to owners of parent for the sixth consecutive year.
(Million yen, amounts rounded down to the nearest million yen)
FY2017Year-on-year

FY2018changeNet sales

193,389

204,896+11,506

Operating income

34,98837,091+2,102

Ordinary income

36,23539,098+2,862

27,142

29,372+2,229Net income attributableto owners of parent

Explanations by segments are as below.
The Chemicals Segment
In the Basic Chemicals, sales of high purity sulfuric acid (agent used for cleaning semiconductor) decreased, while salesof melamine (adhesive agent for particle board) increased. In the Fine Chemicals, sales of "HI-LITE" (chlorinatedisocyanuric acid for sterilizing) increased, while sales of “TEPIC" (epoxy compound for LED sealants) decreased. In
addition, department sales increased while profit decreased due to price revisions occur from increases in raw material
and freight rates.
As a result, sales of this segment was 35,651 million yen (an increase of 714 million yen) and operating income was
3,046 million yen (a decrease of 363 million yen).
The Performance Materials Segment
In the Display Materials, "SUNEVER" (LCD alignment coating) for smartphone had healthy sales. In the Semiconductor
Materials, sales of bottom anti-reflective coatings for semiconductors (ARC®*) and multi-layer process materials(OptiStack®*) increased, supported by strong demand from customers. In the Inorganic Materials, sales of "SNOWTEX"(semiconductor polishing, hard coating, etc.) for general-purpose applications increased. Sales of Organo / Monomer sol(various kinds of coating materials, resin additive) and Oilfield materials (for enhancing oil recovery) declined.
As a result, sales of this segment was 63,031 million yen (an increase of 4,269 million yen) and operating income was
14,966 million yen (an increase of 765 million yen).
*ARC® and Optistack® are registered trade mark of Brewer Science, Inc.

2

The Agricultural Chemicals Segment
Shipments of Fluralaner were strong. In the domestic agrochemicals market, sales of second-generation ALTAIR (paddy
rice herbicide) drugs were favorable. However, conditions for "ROUNDUP" (non-selective leaf treatment herbicide) weresevere due to the impacts of hot summer weather in Japan and natural disasters in the first half of the fiscal year, in addition
to shipments being accelerated in the previous fiscal year. In overseas agrochemicals market, sales were favorable due toan increase in sales of "PULSOR" (fungicide), shipments of "TARGA" (herbicide) ahead of schedule, and the launch ofsales of "GRACIA" (insecticide) in South Korea.
As a result, sales of this segment was 62,724 million yen (an increase of 4,586 million yen) and operating income was
18,351 million yen (an increase of 1,980 million yen).
The Pharmaceuticals Segment
Sales of "LIVALO" declined due to an increase in generics in both domestic and overseas markets. Sales of "Custom
Chemicals" (custom manufacturing and process researching services for pharmaceutical companies) were firm.
As a result, sales of this segment was 7,009 million yen (a decrease of 510 million yen) and operating income was 1,000
million yen (a decrease of 233 million yen).
Trading
Sales of this segment was 67,880 million yen (an increase of 8,393 million yen) and operating income was 2,037 million
yen (an increase of 211 million yen).
OthersSales of this segment was 24,610 million yen (an increase of 3,149 million yen) and operating income was 923 million
yen (an increase of 311 million yen).
(Forecast of business result for the next term)(Billion yen, amounts rounded to the nearest billion yen)
FY2018FY2019

Increase orRate ofResultForecast

decreasechange

(A)

(B)

(B-A)

(%)

Net sales

204.9

210.5

+5.6

+3%

Operating income

37.1

38.7

+1.6

+4%

Ordinary income

39.1

40.2

+1.1

+3%

29.4

30.2

+0.8

+3%

197.67 yen

205.83 yen+8.16 yen

+4%

111 yen

110 yen--

Net income attributable toowners of parent
Basic earnings per share
Average U.S. dollar exchange
rate

3

Segment Sales and Operating Income(Billion yen, amounts rounded to the nearest billion yen)
Net sales

Operating income

FY2018FY2019FY2018FY2019ResultForecast

ResultForecast

Chemicals

35.7

39.0

3.0

4.0

Performance Materials

63.0

64.3

15.0

15.0

Agricultural Chemicals

62.7

64.2

18.4

19.0

Pharmaceuticals

7.0

7.0

1.0

1.0

Trading

67.9

67.8

2.0

2.0

Other

24.6

23.3

0.9

0.6

Adjustment

ᇞ56.0

ᇞ55.1

ᇞ3.2

ᇞ2.9

Total

204.9

210.5

37.1

38.7

As forecast of business result for the next term, we assume net sales will be 210.5 billion yen, operating income
will be 38.7 billion yen, ordinary income will be 40.2 billion yen and net income attributable to owners of parent willbe 30.2 billion yen. The above forecast is calculated on the assumption that the exchange rate will be 110 yen
per dollar.
(2) Analysis of Financial Position(Position of Assets, Liabilities and Net Assets)
Total assets as of March 31, 2019 was 246,990 million yen (an increase of 949 million yen from the previous year). It ismainly due to the increase of notes and accounts receivable-trade and merchandise and finished goods.
Total liabilities as of March 31, 2019 was 64,916 million yen (a decrease of 4,759 million yen). It is mainly due to thedecrease of loans payable.
Net assets as of March 31, 2019 was 182,074 million yen (an increase of 5,709 million yen).
As a result of these factors, equity ratio was 73.0% (an increase of 2.0% from March 31, 2018).
(Position of Cash Flow)
Deducting income taxes paid from income before income taxes and non-controlling interests, depreciation and gain andloss in working capital, net cash provided by operating activities for the consolidated fiscal year ended March 31, 2019was 32,070 million yen (37,691 million yen for the previous year).
Due to investment on plant and equipment, net cash used in investing activities for the consolidated fiscal year ended
March 31, 2019 was 10,884 million yen (15,244 million yen for the previous year).
Due to share repurchase, payment for dividends and of long-term loans payable, net cash used in financing activities
for the consolidated fiscal year ended March 31, 2019 was 22,563 million yen (20,268 million yen for the previous year).
As a result of these factors, cash and cash equivalents for the consolidated fiscal year ended March 31, 2019 was
36,183 million yen (37,702 million yen for the previous year), reflecting exchange of 141 million yen. It decreased by
1,518 million yen compared to the previous year.

4<Reference> The transit of Cash Flow indices
For the year ended

Shareholders’ equity ratio (%)

March 31, 2015

March 31, 2016

March 31, 2017

March 31, 2018

March 31, 2019

66.9

68.1

69.9

71.0

73.0

Shareholders’ equity ratio basedon market value (%)

175.4

196.2

212.2

268.5

303.4

Debt repayment ratio (year)

1.7

1.1

0.9

0.8

0.8

Interest coverage ratio (times)

91.5

154.1

208.0

299.3

288.1

Shareholders' equity ratio: shareholders' equity/total assets
Shareholders' equity ratio based on market value: market capitalization/total assets
Debt repayment ratio: interest-bearing liabilities/cash flows from operating activities
Interest coverage ratio: cash flows from operating activities/interest payments(Notes 1) All indicates are calculated based on consolidated financial figures.
(Notes 2) Market capitalization is calculated based on the number of shares outstanding, excluding treasury shares.
(Notes 3) Cash flows represents operating cash flow.
(Notes 4) Interest-bearing liabilities refer to all liabilities recorded in the consolidated balance sheets that incur interest.
(3) Basic Policy on Distribution of Earnings and Dividends for current and next term
The Company’s basic policy of profit allocation is returning to shareholders by improving company value
through increasing revenue in the medium and long terms.
We aim to realize dividend payout ratio to be 40% in FY2018 and maintain total payout ratio to be 70% in
medium-term business plan “Vista2021” launched from April 2016 and we have achieved in FY2018.
In medium-term business plan “Vista2021” Stage II launched from April 2019, the company aim to realize
dividend payout ratio to be 42.5% in FY2019 and to be 45% after FY2020. In addition, total payout ratio is aimed
to be 72.5% in FY2019 and to be 75% in FY2020.
The year-end dividend is expected to be 42 yen per share. Accordingly, the total annual dividend per share for the current
year ended March 31, 2019 will become 82 yen, which was 68 yen in the previous year.
Total annual dividends per share for the next year ended FY2019 is scheduled to be 88 yen (second quarter: 42 yen,
year-end: 46 yen).

5

2. Management Policy(1) Basic Management Policy
As a group growing with customers, we will strengthen the brand nurtured by our faithful corporate
culture and maximize corporate value through productive activities for the society.

(2) Target Management Indicator
Our most important objectives are “Return on Equity (ROE)” which represents the efficiency of managing
shareholders’ equity and “Operate Profit Ratio to Sales” which leads to a high-value added company. We
will expand our business to increase our revenue.
We aim to realize Return on Equity (ROE) to be above 14% in medium-term business plan “Vista 2021”
launched in April 2016. We have achieved it in FY2016, FY2017 and FY2018.
In medium-term business plan “Vista2021” Stage II launched from April 2019, ROE is aimed to be morethan 16% after FY2019.

(3) Mid-and Long-term Management Strategies and Issues to be addressed
In April 2016, we launched the "Progress2030" long-term management plan for 2030 and the"Vista2021" six-year medium-term management plan, which sets out our vision for 2021, in order toachieve our corporate vision of “becoming a corporate group that contributes to human survival anddevelopment."
In the first three years of the Stage I (FY2016 to FY2018), we positioned "maximize the value of existingproducts and create new products" as our top priority, and pursued three basic strategies: "maximize theprofit from existing products," "improve marketing capability," and "enhance R&D capability." As a result of
these initiatives, we steadily accumulated results and achieved solid results. Nevertheless, there aremajor issues to be addressed, such as the fact that incomes are being driven by certain products, thedelay in the creation of new products, and the response to risks that could impede growth.

In April 2019, we launched the latter three years of Stage II (FY2019 to FY2021) of our medium-termbusiness plan, "Vista2021", with the aim of resolving issues highlighted in the Stage I. The following threebasic strategies have been formulated.
1) Increase profitability of products that are sources of growth2) Strengthen ability to create new products3) Improve ability to adapt to social/market changes

The first strategy, "increase profitability of products that are sources of growth," is to launch the new
insecticide "GRACIA" in Japan in FY2019 following the launch in South Korea in FY2018, and to focus on
full-fledged domestic and overseas market penetration. The "ROUNDUP" (non-selective herbicide) aims
to attract new customers and further sell products by strengthening approaches targeting large-scale
farmers and consumers. We will also work to expand sales of "SUNEVER" (polymide for LCD / flat panel

6displays) for liquid crystal displays by expanding market shares for TVs and introducing new products. In
products of "nanoActiv" for enhancing oil recovery, we will strive to develop our business by developing
new applications and expanding our sales network. We realize our competitive advantage by investing
capital intensively in products that we expect to achieve these growths.

The second strategy, "strengthen ability to create new products," is to expand our overseas R&D
infrastructure for the agrochemicals, display and semiconductor markets, which are expected to grow in
the future, and expand our business opportunities by enhancing our analysis, assessment anddevelopment capabilities. In addition to cutting-edge technology information in Japan and overseas, weplan, promote and manage R&D themes using sales and intellectual property information to promote R&D
based on future demand. In order to cultivate new businesses, we aim to establish technologies andcommercialize materials, such as by participating in national projects. We will accelerate thecommercialization of new products through early collaboration between our R&D and manufacturing
divisions.

The third strategy, "improve ability to adapt to social/market changes," identifies opportunities and risks
for each business and specifies measures to respond to them in a timely and appropriate manner tosudden changes in the business environment. In addition, we will promote the introduction of IoT, AI andother digital technologies for plant conservation. By raising productivity through this process, we will
establish a secure conservation system to prepare for the expected shortage of labor in the future. In
order to help solve social issues and deal with materiality (important issue) to realize our corporate vision
for 2030, we will set the key achievement indicators for FY 2021. To enhance corporate governance, weestablished the Nomination and Remuneration Advisory Committee in April this year. Furthermore, byincreasing one more member of outside directors under a resolution of the General Meeting of
Shareholders held in June this year, more than one-third of the directors will be outside directors.
We will further strengthen our efforts to improve the soundness and transparency of business, ensure
thorough compliance, give greater consideration to the environment, and contribute to society.
We believe that our group has earned a certain degree of acclaim from the market in terms of stableperformance, proactive shareholder returns, and the degree to which our company plans have beenachieved. In order to become a company that is even more trusted than ever before, we must take a leap
forward by appropriately responding to the rapidly changing business environment and the increasingly
sophisticated demands of society.
To this end, we will take on the challenge of further heightening our presence in fields where demand is
expected to grow in earnest, such as automotive and regenerative medicine.
With this in mind, we have formulated the Stage II slogan "Strive for perpetual growth and become acompany that carves out the future."
We are committed to meeting the expectations of our stakeholders by making every effort to realize ourslogan.

7

3. Basic approach to the Selection of Accounting Standards
The Company will research on trend of IFRS in the country and overseas and correspond properly when
applying IFRS.

8

4. Consolidated Financial Statements(1) Consolidated Balance Sheets(Million yen)
As ofMarch 31, 2018

As ofMarch 31, 2019

AssetsCurrent assets
Cash and deposits

37,702

36,183

Notes and accounts receivable - trade65,422

69,193Merchandise and finished goods

29,85532,215115

41

Raw materials and supplies

7,797

9,742

Accounts receivable - other

1,831

2,207

Short-term loans receivable

494

512

2,422

2,427

(34)

(32)

145,606

152,490

Work in process

Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures

63,98565,942

Accumulated depreciation and impairment loss

(39,573)(40,690)

Buildings and structures, net

24,41125,251

Machinery, equipment and vehicles

125,451

130,490(112,434)(117,523)

13,017

12,96637,32338,458(32,261)(34,385)

5,061

4,073

9,047

9,059

22

-

(22)

-

0

-

Construction in progress

2,936

1,378

Total property, plant and equipment

54,47352,729

775

721

993

796

1,768

1,517

Investment securities

38,51735,229Deferred tax assets

132

110

Net defined benefit asset

2,193

2,089

Other

3,440

2,917

(92)

(92)

Accumulated depreciation and impairment loss
Machinery, equipment and vehicles, net
Tools, furniture and fixtures
Accumulated depreciation and impairment loss
Tools, furniture and fixtures, net
Land
Leased assets
Accumulated depreciation
Leased assets, net

Intangible assets
Software
Other
Total intangible assets
Investments and other assets

Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

944,191

40,253

100,433

94,500246,040

246,990

(Million yen)
As ofMarch 31, 2018

As ofMarch 31, 2019

Liabilities
Current liabilities
Notes and accounts payable - trade18,57917,809

Short-term loans payable

23,591

23,605Current portion of long-term loans payable

2,554

1,860

Income taxes payable

5,156

4,330

Provision for bonuses

2,011

2,137

Provision for directors' bonuses

27

25

Other

10,95010,430Total current liabilities

62,87160,198Long-term loans payable

2,446

1,116

Deferred tax liabilities

1,338

823

Provision for business structure improvement

516

370

Provision for loss on business of subsidiaries and affiliates

309

309

Net defined benefit liability

126

152

Other

2,068

1,945

Total non-current liabilities

6,804

4,717

69,67564,916

Non-current liabilities

Total liabilities
Net assets
Shareholders' equity
Capital stock

18,942

18,942

Capital surplus

13,613

13,613Retained earnings

133,822

143,200

Treasury shares(5,962)(6,291)

Total shareholders' equity

160,416

169,464

13,653

10,634Foreign currency translation adjustment

125

(11)

Remeasurements of defined benefit plans

390

258

14,17010,880

1,778

1,728

Accumulated other comprehensive income
Valuation difference on available-for-sale securities

Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

10

176,364

182,074

246,040

246,990

(2) Consolidated Statements of Income / Consolidated Statements of Comprehensive Income- Consolidated Statements of Income(Million yen)
Year Ended
March 31, 2018Year Ended
March 31, 2019

Net sales

193,389

204,896

Cost of sales

113,513

119,911Gross profit

79,87684,985

Selling, general and administrative expenses

44,88747,893Operating income

34,98837,091Non-operating income
Interest income

26

31

Dividend income

817

981

1,324

970

Equity in earnings of affiliates
Other

768

1,142

2,937

3,126

Interest expenses

126

110

Loss on disposal of non-current assets

591

630

Plant stop losses

270

249

Foreign exchange losses

460

24

Total non-operating income
Non-operating expenses

Other
Total non- operating expenses
Ordinary income
Extraordinary income
Extraordinary losses

240

104

1,690

1,119

36,23539,098----

Income before income taxes and non-controlling interests

36,23539,098

Income taxes - current

9,146

8,690

Income taxes - deferred

(214)

893

Total income taxes

8,932

9,583

Net income

27,30229,514

159

141

27,142

29,372

Net income attributable to non-controlling interests
Net income attributable to owners of parent11

- Consolidated Statements of Comprehensive Income(Million yen)
Year Ended
March 31, 2018
Net income

Year Ended
March 31, 201927,30229,514

Valuation difference on available-for-sale securities

3,575(3,018)Foreign currency translation adjustment

Other comprehensive income

(124)

(159)

Remeasurements of defined benefit plans, net of tax

10

(132)

Share of other comprehensive income of entities accounted forusing equity method

(1)

(0)

3,460

(3,311)

30,763

26,20330,60926,083

153

119

Total other comprehensive income
Comprehensive income(Comprehensive income attributable to)
Owners of parent
Non-controlling interests12(3) Consolidated Statements of Changes in Net Assets
For the Year Ended March 31, 2018 (From April 1, 2017 to March 31, 2018)(Million yen)
Total shareholders' equity
Capital stock

Balance at beginning of current
periodRetainedearnings

Capital surplus

18,942

13,611

Treasury shares

126,370(7,587)

Total
shareholders'equity151,337

Changes of items during period
Dividends of surplus(9,063)(9,063)

Net income attributable to ownersof parent

27,142

27,142

Share repurchase
Cancellation of treasury shares(10,627)

Change in ownership interest ofparent due to transactions with
non-controlling interests
Net changes of items other thanshareholders' equity
Total changes of items during period
Balance at end of current period(9,002)(9,002)

10,627

-

2

2

-

2

7,452

1,624

9,078

18,942

13,613

133,822(5,962)

160,416

Accumulated other comprehensive income
Total
Valuation
Foreign currency Remeasurements
accumulateddifference onof defined benefit
translation
otheravailable-for-saleplansadjustment
comprehensive
securities
incomeBalance at beginning of current
period10,079243

380

10,703

Non-controllinginterests

1,666

Total
net assets

163,707

Changes of items during period
Dividends of surplus(9,063)

Net income attributable to ownersof parent

27,142

Share repurchase(9,002)

Cancellation of treasury shares
Change in ownership interest ofparent due to transactions with
non-controlling interests
Net changes of items other thanshareholders' equity

2
3,574

(118)

10

3,466

111

3,578

Total changes of items during period

3,574

(118)

10

3,466

111

12,657

Balance at end of current period

13,653125

390

14,170

1,778

176,36413

For the Year Ended March 31, 2019 (From April 1, 2018 to March 31, 2019)(Million yen)
Total shareholders' equity
Capital stock

Balance at beginning of current
periodCapital surplus

18,942

13,613Retainedearnings

Treasury shares

133,822(5,962)

Total
shareholders'equity160,416

Changes of items during period
Dividends of surplus(11,320)(11,320)

Net income attributable to ownersof parent

29,372

29,372

Share repurchase
Cancellation of treasury shares(9,004)(9,004)(8,674)

8,674-

Net changes of items other thanshareholders' equity
Total changes of items during period
Balance at end of current period

-

-

9,377

(329)

9,048

18,942

13,613

143,200(6,291)

169,464

Accumulated other comprehensive income
Total
Valuation
Foreign currency Remeasurements
accumulateddifference onof defined benefit
translation
otheravailable-for-saleplansadjustment
comprehensive
securities
incomeBalance at beginning of current
period13,653125

390

14,170Non-controllinginterests

1,778

Total
net assets

176,364

Changes of items during period
Dividends of surplus(11,320)

Net income attributable to ownersof parent

29,372

Share repurchase(9,004)

Cancellation of treasury shares-

Net changes of items other thanshareholders' equity(3,019)

(137)

(132)

(3,289)(49)(3,338)

Total changes of items during period(3,019)

(137)

(132)

(3,289)

(49)

5,709

Balance at end of current period

10,634(11)

258

10,8801,728

182,07414

(4) Consolidated Statements of Cash Flows(Million yen)
Year Ended
March 31, 2018Year Ended
March 31, 2019

Cash flows from operating activities
Income before income taxes and non-controlling interests

36,23539,098Depreciation and amortization

10,51010,915Interest and dividend income(844)(1,013)

Interest expenses

126

110

Loss (gain) on disposal of non-current assets

591

630

Decrease (increase) in notes and accounts receivable - trade(5,266)(3,877)

Decrease (increase) in inventories(1,309)(4,304)

Increase (decrease) in notes and accounts payable - trade

3,494

(671)

Other

(328)

(913)

Subtotal

43,20939,974

Interest and dividend income received

1,881

1,633

Interest expenses paid

(125)

(111)

Income taxes paid

(7,273)(9,426)

Net cash provided by (used in) operating activities

37,691

32,070

(759)

(910)

Cash flows from investing activities
Purchase of investment securities
Proceeds from sales of investment securities

65

450

(13,768)(9,747)

Payments for retirement of property, plant and equipment

(405)

(525)

Purchase of intangible assets

(585)

(192)

Purchase of property, plant and equipment

Net decrease (increase) in short-term loans receivable

546

(2)

Purchase of long-term prepaid expenses

(67)

(46)

Other

(270)

90

(15,244)(10,884)

Net increase (decrease) in short-term loans payable

501

(46)

Proceeds from long-term loans payable

420

530

Net cash provided by (used in) investing activities
Cash flows from financing activities

Repayments of long-term loans payable(3,070)(2,554)

Cash dividends paid

(9,063)(11,320)

(39)

(167)

(9,002)(9,004)

Dividends paid to non-controlling interests
Share repurchase
Other

(14)

(0)

(20,268)(22,563)

(177)

(141)

Net increase (decrease) in cash and cash equivalents

2,000(1,518)Cash and cash equivalents at beginning of period

35,70137,702

Cash and cash equivalents at end of period

37,702

36,183

Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents15(5) Notes to Consolidated Financial Statements(Going Concern Assumption)
Not applicable.

(Reclassifications)
The company has applied the amendments from "Ministerial Ordinance to revise a part of Company Law Enforcement Regulations andCompany Calculation Rules" (Ministry of Justice Ordinance No.5, March 26, 2018) from the beginning of the current financial year.
Accordingly, "deferred tax assets" and "deferred tax liabilities" are reclassified and included in the "investments and other assets" section
and the "non-current liabilities" section, respectively.
As a result, 3,019 million yen of "deferred tax assets (current assets)" and 2,877 million yen of "deferred tax liabilities (non-current liabilities)"
are reclassified as 132 million yen of "deferred tax assets" classified as "investments and other assets".
In addition, 115 million yen of "deferred tax assets (investments and other assets)" and 1,454 million yen of "deferred tax liabilities (non-current
liabilities" are reclassified as 1,338 million yen of "deferred tax liabilities" classified as "non-current liabilities".

(Segment and Related Information)
Segment Information
1. General Information about reportable segments
The Company's reportable segments are components of the Group that engage in business activities, whose operating results are regularly
reviewed by the Board of Directors when making resource allocation and performance assessment decisions, and for which discrete financial
information is available.
Divisions by products and services are located in the headquarter, and each division works out a comprehensive strategy applicable to theirproducts and services and carries out their business activities.
The Company consists of segments based on divisions as follows:
Main Products

Segment

Basic chemicals (melamine, sulfuric acid, nitric acid, ammonia, etc.)
Chemicals

Fine chemicals (epoxy compound for LED sealants, solder resist and painting,flame retardants, chlorinated cyanuric acid for sterilizing, etc.)
Display materials (LCD alignment coating, etc.)

Performance
Materials

Semiconductor materials (bottom anti-reflective coating for semiconductors, etc.)
Inorganic materials (hard coating materials, electronic information materials, polishing materials, etc.)

Agricultural Chemicals
Pharmaceuticals

Agrochemicals (herbicides, insecticides, fungicides, combination fungicide and insecticide, and plant growth regulators)
Animal health products
LIVALO (anti-cholesterol drug), etc.
Finetech (custom manufacturing and process researching services for pharmaceutical companies)

Trading

Trading, etc.

OthersTransportation, landscaping, engineering, fertilizer, etc.

2. Basis of measurement of reported segment income or loss, segment assets and other material items
The accounting policies for the reportable segments are consistent with the Company's accounting policies used in the preparationof its consolidated financial statements. Intersegment sales and income (loss) are recognized based on current market prices.

16

3. Information Regarding Sales, Income (Loss), and Segment Assets of Reportable Segments
1) For the Year Ended March 31, 2018 (From April 1, 2017 to March 31, 2018)
Performance Agricultural
Chemicals
Materials
Chemicals(Million yen)Pharmaceuticals

Trading

Others

Total

Adjustment(1)

Consolidated
Total
193,389

Sales
Customers

25,546

51,97354,262

7,493

44,474

9,638

193,389－

Intersegment

9,390

6,789

3,876

26

15,012

11,822

46,917(46,917)－

Total sales

34,93758,762

58,1387,520

59,486

21,461

240,306(46,917)

193,389

Operating income (loss)

3,410

14,20016,370

1,233

1,826

612

37,653(2,665)34,988Segment assets

26,97652,88856,6209,118

23,261

9,588

178,454

67,585

246,040

1,733

5,925

1,416

713

52

319

10,161347

10,508

Amortization of goodwill
1
Increase of property,
2,594
plant and equipment
and intangible assets(Notes 1) The adjustments are as follows:

－

－

－

－

－

1

－

1

7,209

2,541

679

23

304

13,352341

13,694

Other items
Depreciation andamortization(1) The (2,665) million yen adjustment in segment income includes (254) million yen in intersegment eliminations and (2,410) million yen corporate
expenses not attributable to any reportable segment.
The corporate expenses are mainly group administrative expenses which do not belong to segments.
(2) The 67,585 million

yen adjustment

in segment

assetsincludes

(8,200) million

yen in intersegment

eliminations

and 75,786

million yen in corporate assets not attributable to any reportable segment. The corporate assets are mainly group administrative assets which
do not belong to segments.
(3) The 347 million yen adjustment in depreciation and amortization is corporation expenses.
(4) The 341 million yen adjustment in increase of property, plant and equipment and intangible assets is corporate assets. The corporate assets
are mainly group administrative assets which do not belong to segments.
2) For the Year Ended March 31, 2019 (From April 1, 2018 to March 31, 2019)
Performance Agricultural
Chemicals
Materials
Chemicals(Million yen)Pharmaceuticals

Trading

Others

Total

Adjustment(1)

Consolidated
Total
204,896

Sales
Customers

25,991

55,65557,513

6,968

48,562

10,188204,879

16

Intersegment

9,660

7,376

5,211

40

19,317

14,421

56,028(56,028)－

Total sales

35,651

63,03162,724

7,009

67,88024,610260,908(56,011)

204,896

Operating income (loss)

3,046

14,966

18,351

1,000

2,037

923

40,325(3,234)37,091

Segment assets

28,66951,256

61,818

9,063

25,507

11,479187,794

59,196

246,990

1,805

6,059

1,680

645

49

322

10,563350

10,913

Amortization of goodwill
1
Increase of property,
2,021
plant and equipment
and intangible assets(Notes 1) The adjustments are as follows:

－

－

－

－

－

1

－

1

3,246

3,326

502

122

438

9,658

280

9,938

Other items
Depreciation andamortization(1) The (3,234) million yen adjustment in segment income includes (405) million yen in intersegment eliminations, 16 million yen sales
not attributable to any reporting segment, and (2,845) million yen corporate expenses not attributable to any reportable segment.
The corporate expenses are mainly group administrative expenses which do not belong to segments.
(2) The 59,196 million yen adjustment

in segment assets includes (11,968) million

yen in intersegment

eliminations

and 71,165

million yen in corporate assets not attributable to any reportable segment. The corporate assets are mainly group administrative assets which
do not belong to segments.
(3) The 350 million yen adjustment in depreciation and amortization is corporation expenses.
(4) The 280 million yen adjustment in increase of property, plant and equipment and intangible assets is corporate assets. The corporate assets
are mainly group administrative assets which do not belong to segments.

17

Related Information
For the Year Ended March 31, 2018 (From April 1, 2017 to March 31, 2018)
Sales by region(Million yen)
Other Asia Europe andConsolidated(except Japan the United
Total
Statesand Korea)

Japan

Korea

104,523

20,21839,33929,308

193,389

Note: Sales are classified to either countries or regions based on customers are located.
For the Year Ended March 31, 2019 (From April 1, 2018 to March 31, 2019)
Sales by region(Million yen)
Other Asia Europe andConsolidated(except Japan the United
Total
Statesand Korea)

Japan

Korea

107,131

22,341

43,35432,068204,896

Note: Sales are classified to either countries or regions based on customers are located.

Information regarding impairment loss on non-current assets by reportable segments
For the Year Ended March 31, 2018 (From April 1, 2017 to March 31, 2018)
Not applicable.
For the Year Ended March 31, 2019 (From April 1, 2018 to March 31, 2019)
Not applicable.

Information regarding amortization and unamortized balance on goodwill by reportable segments
For the Year Ended March 31, 2018 (From April 1, 2017 to March 31, 2018)
Chemicals

Balance as ofMarch 31, 20186

Performance
Materials

Agricultural
Chemicals－－

Pharmaceuticals

Trading－

Others

－

Total

－

Adjustment

6－(Million yen)
Consolidated
Total

6

For the Year Ended March 31, 2019 (From April 1, 2018 to March 31, 2019)
Chemicals

Balance as ofMarch 31, 20194

Performance
Materials

Agricultural
Chemicals－－

Pharmaceuticals

Trading－－

18

Others(Million yen)
Consolidated
Adjustment
Total

Total

－

4

－

4

(Per Share Information)(Yen)
Year Ended March 31, 2018Year Ended March 31, 2019

Net asset per share

1,168.07

1,220.35

Net income per share180.30197.67

Notes:
1. Since residual securities do not exist, diluted net income per share is not presented.
2. Net income per share is calculated on the following basis.
(Million yen)
Year Ended March 31, 2018Year Ended March 31, 2019

Net income per share
Net income attribute to owners of parent

27,142

Amounts not allocated to ordinary shares－

29,372－

Net income allocated to ordinary shares
Average number of ordinary shares
outstanding during each year

27,142

29,372

150,542,352

148,593,042

3. Net asset per share is calculated on the following basis.
(Million yen)
Year Ended March 31, 2018
Net asset

Year Ended March 31, 2019

176,364

182,074

Amount deducted from net asset

1,778

1,728

(Non-controlling interest)
Net asset as of year end allocated toordinary shares
Number of ordinary shares as of year
end used to calculate net asset per share(1,778)(1,728)

174,586

180,345

149,465,438

147,782,128(Significant Subsequent Events)
1.The Company, at the Board of Director’s meeting held on April 23, 2019, has decided to cancel its own shares under Article 178of the Japanese Corporation Act.
(1) Class of shares to be cancelled :Common shares of company(2) Number of shares to be cancelled :1,000,000 shares (0.67% of issued shares prior to cancellation)(3) Scheduled date of cancellation :May 10, 2019

Reference
Number of issued shares subsequent to cancellation (including treasury shares) : 148,000,000 shares
2. The Company, at the Board of Director’s meeting held on May 15, 2019, has decided to repurchase its shares in the market
under Article 156 of the Japanese Corporation Act, as applied pursuant to Article 165, Paragraph 3 of the same Act.
(1) Purpose of repurchaseTo facilitate flexible implementation of capital policy in response to changes in the business environment.
(2) Details of repurchase①Class of shares:

Common shares of the company②Total number of shares:

Up to 1,700,000 shares (Rate of the maximum shares to be acquired
to the total outstanding shares: 1.15%)③Total amount:④Period of repurchase:
Reference
Number of treasury shares as of May 10, 2019
Total number of shares issued (excluding treasury shares)
Number of treasury shares

Up to 6,000,000,000 yen
From May 16, 2019 to August 30, 2019

: 147,782,048 shares:
217,952 shares

19