Summary of Consolidated Financial Results for First Half of FY2019
Nov. 5, 2019
Mitsubishi Gas Chemical Company, Inc (TSE 4182)
1.Summary of Income Statement (April 1- Sep 30, 2019)
Apr. 1 -Sep. 30,
2018328,376

Net Sales

Millions of yen, rounded down
Apr. 1 -Sep. 30,
Change (%)
2019
303,369(7.6)

Operating income

28,95016,034(44.6)

Ordinary income

46,532

11,690(74.9)Net income attributable to owners of the parent

37,9198,147(78.5)(87.0)

Comprehensive income

41,1955,350

Net income per share (Yen)

177.5138.45

2. Financial Position
Millions of yen, rounded down
As of Sep. 30, 2019

As of Mar. 31, 2019
Total Assets

804,038

771,361

Net Assets

553,282

550,782

62.6

64.5

Equity Ratio(%)
3. Dividends
FY2018FY2019(Forecast)Interim dividend per share (Yen)

35.00

35.00

Year-end dividend per share (Yen)

35.00

35.00

Annual Dividend per share (Yen)

70.00

70.00

(Note) Revision of cash dividend forecast during this period: None
4. Consolidated Business Forecasts for FY2019 (April 1, 2019 - March 31, 2020)
Millions of yen, rounded down
Full YearNet Sales610,000

Operating income

31,000Ordinary income

27,000Net income attributable to owners of the parent

18,000Net income per share (Yen)

85.45(Note) Revision of consolidated business forecasts during this period: Yes
Please refer to ”Revision of Business Performance”for details.
5. Number of Shares Outstanding (Common Stock)
Mar31,2019

Sep30,2019

Number of shares outstanding at term end (including treasury stock)

231,739,199

229,039,199

Number of shares of treasury stock at term-end

18,099,472

18,065,233

Apr. 1 -Sep. 30,
2018

Apr. 1 -Sep. 30,
2019213,619,751

211,908,343

Average shares outstanding during period

1. These quarterly financial results are not subject to quarterly review procedures. At this time of disclosure ofthese financial results, the quarterly financial statement review procedures based on the Financial Instrument andExchange Law have not been completed.
2. Forecasts, etc., recorded in this document contain forward-looking statements that are based on management’s
estimates, assumptions and projections at the time of publication. A number of factors could cause actual results
to differ materially from expectations.

Consolidated Financial Statements
1. Consolidated Balance Sheets(Millions of yen, rounded down)
As of Mar. 31, 2019 As of Sep. 30, 2019ASSETS
Current assets
Cash and deposits
Trade notes and accounts receivable
Short-term investments securities
Merchandise and finished goods
Work in progress
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
Other, net
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Other
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets

191,130
155,50723
67,681
13,30838,262
13,965(1,033)378,845

82,444
144,657
89
63,62812,78936,651
12,680(1,003)351,937

81,63078,70068,161
228,492

84,30780,66474,702
239,674

3,841
4,772
8,614

5,493
5,381
10,875177,011
11,617(543)
188,086
425,193804,038

156,466
12,934(527)
168,874
419,423
771,361

Consolidated Balance Sheets (continued)(Millions of yen, rounded down)
As of Mar. 31, 2019 As of Sep. 30, 2019
LIABILITIESCurrent liabilities
Trade notes and accounts payable
Short-term loans payable
Income taxes payable
Provision
Asset retirement obligations
Other
Total current liabilities
Noncurrent liabilities
Bonds payable
Long –term loans payable
Provision
Projected benefit obligations
Asset retirement obligations
Other
Total noncurrent liabilities
Total liabilities
NET ASSETS
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive incomeValuation difference on available-for-sale securities
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive
Non controlling interest
Total net assets
Total liabilities and net assets

2

80,08958,749
3,439
6,213
113
39,814
188,420

67,80348,448
3,096
5,968
54
31,394
156,766

10,00026,615
4,169
5,247
2,324
13,97862,336
250,756

10,00026,130
4,261
5,727
3,508
14,18363,811
220,578

41,97034,298439,080(19,930)
495,418

41,97034,248438,089(20,612)493,695

13,023
1
222(6,327)623
7,542
50,321
553,282804,038

11,163(1)
184(7,482)
219
4,083
53,004
550,782
771,361

2. Consolidated Statements of Income

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Equity in earnings of affiliates
OtherTotal non-operating income
Non-operating expenses
Interest expense
Personnel expenses for seconded employees
Rent expenses
Share of loss of entities accounted for using equity method
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of investment securities
Gain on step acquisitions
Compensation received
Gain on sales of non-current assets
Total extraordinary income
Extraordinary losses
Loss on accident
Loss on disposal of non-current assets
Provision for loss on guarantees
Loss on valuation of investment securities
Total extraordinary losses
Income before income taxes, etc.
Income taxes, etc.
Net income
Net income attributable to non-controlling interests
Net income attributable to owners of the parent

3(Millions of yen, rounded down)
Apr. 1 -Sep. 30, Apr. 1 -Sep. 30,
2018
2019
328,376
303,369
252,451
239,632
75,92563,737
46,97447,702
28,95016,034286
1,509
17,2701,711
20,777

291
1,646
2,178
4,116

545
897
791
961
3,195
46,532

473
804
764
3,865
2,553
8,460
11,690

859
714
1,573

1,501
1,016
564
3,082

631
374
1,005
47,101
7,129
39,971
2,052
37,919187
174
362
14,411
4,508
9,902
1,7548,147

(Consolidated Statements of Comprehensive Income)(Millions of yen, rounded down)
Apr. 1 -Sep. 30, Apr. 1 -Sep. 30,
2018
2019
Net income
Other comprehensive Income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency statements translation adjustment
Remeasurements of defined benefit plans
Share of other comprehensive income of associates accounted for using equity method
Total other comprehensive Income
Comprehensive income
Comprehensive income attributable to owners of the parent
Comprehensive income attributable to non-controlling interests

439,971

9,902

(322)
(12)
(1,324)
(284)
3,168
1,224
41,19540,182
1,012(1,796)(3)(3,858)(181)
1,287(4,552)
5,350
4,743607

3.Segment Information(Billions of yen, rounded down）
FY 2018

FY 2019

1H

1H

FY2018

328.3

303.3

(25.0)

648.9

610.0

Natural Gas Chemicals

92.5

79.1

(13.4)

188.3

158.4

Aromatic Chemicals

107.3

103.1

(4.1)

211.7

200.3

Specialty Chemicals

106.1

99.4

(6.6)

205.7

206.4

Information and Advanced Materials

27.1

26.2

(0.9)

51.9

52.0

(4.8)

(4.6)

(0.2)

(8.7)

(7.3)

28.9

16.0

(12.9)

41.3

31.0

Natural Gas Chemicals

3.2(0.5)

(3.8)

3.3

1.7

Aromatic Chemicals

10.1

7.7

(2.3)

14.6

13.3

Specialty Chemicals

14.1

8.0

(6.1)

21.2

14.8

Information and Advanced Materials

2.5

2.0

(0.4)

3.9

3.7

Other and Adjustment
Non-operating profit

(1.1)

(1.2)

(0)

(1.8)

(2.7)

17.5

(4.3)

(21.9)

27.8

(4.0)

Ordinary income

46.5

11.6

(34.8)

69.1

27.0

Natural Gas Chemicals

15.7

(6.4)

(22.1)

22.6

(4.7)

Aromatic Chemicals

9.7

7.3

(2.3)

13.9

12.7
17.5

ChangeFY 2019

Full Year Full Year
ResultNet sales

Other and Adjustment
Operating income (loss)

Forecast

Specialty Chemicals

17.8

9.4

(8.4)

28.2

Information and Advanced Materials

3.0

2.3

(0.6)

4.4

3.8

Other and Adjustment

0.1

(1.0)

(1.1)

(0.1)

(2.4)

4.Other Information 1
FY2015FY2016FY2017FY2018FY2019Forecast
48.0

Investments(Billions of yen)

Full year

30.5

35.0

30.9

39.2

1H

14.9

13.7

13.9

18.6

22.4

Depreciation & amortization(Billions of yen)

Full year26.7

25.6

27.0

27.4

29.0

1H

13.1

12.2

13.1

13.5

14.4

R&D expenditures(Billions of yen)

Full year

18.9

19.2

18.9

18.6

20.0

1H

9.2

9.6

9.5

9.1

9.4

Number of Staff

Year-end

8,176

8,034

8,009

8,276

9,000

ROA (Ordinary income)

5.9%

8.4%

10.6%

8.7%

3.4%

ROE (Net income)

9.0%

12.0%

13.6%

11.3%

3.6%

5.Other Information 2
FY2015FY2016FY2017FY2018ResultResultResultResult

FY2019ResultForecast

First half

Second halfFirst half

Second halfFirst half

Second halfFirst halfSecond halfFirst half

Second half

Exchange Rate
(JPY/USD, Average)

122

118

105

112

111

111

110

112

109

105

Exchange Rate
(JPY/EUR, Average)

135

130

118

119

126

133

130

127

121

120

crude oil (Dubai)(USD/BBL)

56

36

43

51

50

62

73

65

64

60

Methanol (USD/MT, Asian
average spot price)

301

230

230

327

296

381

408

335

277

270

Mixed Xylene(USD/MT)

740

630

660

680

650

725

845

730

704

705

Bisphenol A(USD/MT)*

950

850

1,000

1,000

1,100

1,200

1,600

1,200

1,000

1,000

～ 1,500～ 1,100～ 1,200～ 1,400～ 1,300～ 1,700～ 1,900～ 1,800～1,450～1,300

Polycarbonate(USD/MT)*

2,100

2,000

2,200

2,400

2,500

2,900

2,700

2,100

1,900

1,850～ 2,650～ 2,400～ 2,500～ 2,800～ 2,900～ 3,900～ 3,800～ 2,800～2,250～2,100*Describe the minimum and maximum values during the period5Qualitative Information
Consolidated Business Results for This Period
Overview of Results(Billions of yen)
FY2018 / 1H

FY2019 / 1H

ChangeNet sales

328.3

303.3

(25.0)

Operating income

28.9

16.0(12.9)

Ordinary income

46.5

11.6(34.8)

37.98.1(29.7)

Net income attributable to owners of
the parent

During the first half of the fiscal year ending March 2020 (April 1 - September 30, 2019), the world
economy slowly recovered overall. However, there was also a looming sense of uncertainty due toheightening tension between the United States and China over trade issues and growing concerns about
the impact of China’s decelerating economic growth, the unclear outlook regarding a Brexit deal, andvolatility in financial and capital markets. The Japanese economy saw gradual overall recovery, including
continued improvement in employment, despite ongoing stagnation in some areas, particularly exports.
The management environment of the MGC Group remained challenging, as market prices of such key
products as methanol, polycarbonates, purified isophthalic acid and other general-purpose products
remained sluggish.
The MGC Group’s net sales decreased year on year, reflecting the decline in market prices formethanol, polycarbonates and other products.
Group operating income also fell year on year, despite an increase in the sales volume of special
polycarbonates and specialty aromatic chemical products, due to significant drops in market prices forsuch products as polycarbonates, purified isophthalic acid and methanol, which were high in the same
period of the previous fiscal year.
Ordinary income also decreased, due to the fall in operating income as well as a significant
deterioration in equity in earnings (losses) of affiliated companies related to overseas methanol producing
companies. As described below, this reflected one-off costs recorded at a joint venture in Saudi Arabia.
As previously announced, from the first quarter onward, MGC’s Consolidated Financial Statements
reflect the impact of the decreased ratio of equity held by Japan Saudi Arabia Methanol Co., Inc. (JSMC) , anequity method affiliate, in the Saudi Methanol Company (AR-RAZI) and amortization costs associated withcash to be paid as consideration for the continuation of the joint venture status of AR-RAZI. MGC also

recorded one-off costs totaling ¥7.8 billion, including loss related to the sale of shares of AR-RAZI as well as
additional tax-related expenses. The aforementioned factors are included in equity in losses of affiliates.

6Results by Business Segment
Natural Gas Chemicals(Billions of yen)
FY2018 / 1H

FY2019 / 1H

ChangeSales

88.1

75.3

(12.8)

Operating income

3.2(0.5)(3.8)

Ordinary income

15.7(6.4)(22.1)The methanol business saw decreases in both net sales and earnings due to a decrease in market prices
compared with the same period of the previous year.
Methanol and ammonia-based chemicals posted decreased earnings due to lower market prices ofMMA-based products and neopentyl glycol.
Crude oil and other energy sources achieved a year-on-year improvement in results, thanks in part tohigher crude oil sales volume.

Aromatic Chemicals(Billions of yen)
FY2018 / 1H

FY2019 / 1H

ChangeSales

107.1

102.8(4.2)

Operating income

10.1

7.7(2.3)

Ordinary income

9.7

7.3

(2.3)

Specialty aromatic chemical products posted increases in net sales and earnings from the same period of
the previous fiscal year, due in part to growing sales volume of meta-xylenediamine and aromatic
aldehydes.
General-purpose aromatic chemical products suffered decreases in net sales and earnings comparedwith the same period of the previous fiscal year. Negative factors included significantly lower market
prices of purified isophthalic acid.
Foamed plastics suffered a year-on-year decline in earnings, primarily due to weak demand and a risein fixed costs associated with the construction of production systems to meet new demand.

7Specialty Chemicals(Billions of yen)
FY2018 / 1H

FY2019 / 1H

Change

Sales

105.5

98.6

(6.9)

Operating income

14.1

8.0(6.1)

Ordinary income

17.8

9.4

(8.4)

Inorganic chemicals posted lower earnings compared with the previous year, primarily due to higher fixed
costs in connection with the launch of a new production facility for super-pure hydrogen peroxide in North
America and deterioration in the profitability of hydrogen peroxide.
The engineering plastics business recorded decreased earnings year on year. This was due mainly toa significant decrease in market prices for polycarbonates, despite growth in special polycarbonate sales
volumes reflecting the growing use of multiple camera lenses in smartphones.

Information & Advanced Materials(Billions of yen)
FY2018 / 1H

FY2019 / 1H

ChangeSales

27.1

26.1(1.0)

Operating income

2.5

2.0(0.4)

Ordinary income

3.0

2.3

(0.6)

Electronic materials saw a decline in earnings. Demand, which was weak in the latter half of the previous
fiscal year, recovered. Sales volumes of BT materials for semiconductor packaging, the core productcategory for electronic materials, recovered but did not reach the level of the same period of the previous
fiscal year.
Oxygen absorbers such as AGELESSTM posted earnings on par with the previous year, thanks mainly
to the robust showings of those sold in Japan for use in confectionary packages.

(End)8