SUMMARY OF CONSOLIDATED FINANCIAL STATEMENTS
Results for the First Half of Fiscal Year 2012
(April 1 – September 30, 2012)

November 2, 2012

MITSUBISHI GAS CHEMICAL COMPANY, INC.
Listed exchanges:

First section of the Tokyo Stock Exchange

Stock Code:

4182

URL:

http://www.mgc.co.jp

President:

Kazuo Sakai

Inquiries:

Motoyasu Kitagawa
General Manager, Corporate Communications Division
Tel: +81-3-3283-5041

Scheduled date of filing of the quarterly financial report: November 9, 2012
Scheduled date of payment of dividend: December 5, 2012

1. Summary of Consolidated Results for the First Half of Fiscal Year 2012
(April 1, 2012 – September 30, 2012)
1) Operating results
Millions of yen, rounded down
Percentage figures denote change compared to equivalent period of previous year

April 1 – September 30, 2012

April 1 – September 30, 2011

Change %Net sales.......................................................................................... 232,789
Operating income (loss)..................................................................
3,933
Ordinary income (loss).................................................................... 11,235
Net income (loss).............................................................................
8,116
17.97
Net income (loss) per share (¥).......................................................
Fully diluted net income (loss) per share (¥)..................................
-

Change %1.2(47.6)(30.7)(33.0)

230,076
7,500
16,204
12,109
26.79
26.28

1.3
(40.6)(6.2)
89.4(Note) Comprehensive income: first half of FY 2012：¥8,723 million [(12.6%)] ; first half of FY 2011：¥9,980 million [51.5%]

2) Financial position
Millions of yen, rounded down

As of September 30, 2012
Total assets......................................................................................
611,713
Net assets........................................................................................
297,688
Equity ratio (%).................................................................................
47.0

As of March 31, 2012
595,250
292,11147.3(Note) Shareholders’ equity as of September 30, 2012: ¥287,220 million; as of March 31, 2012: ¥281,687 million

2. Cash Dividends
Interim dividend per share (¥).........................................................
Year-end dividend per share (¥).....................................................
Annual dividend per share (¥).........................................................
(Note) Revision of cash dividend forecast during this period: None

FY 20126.00
6.00 (Forecast)
12.00 (Forecast)

FY 2011
6.00
6.00
12.00

3. Consolidated Business Forecasts for Fiscal Year 2012
(April 1, 2012 – March 31, 2013)
Millions of yen, rounded down
Percentage figures denote change compared to equivalent period of previous year

Full Year
Change %Net sales........................................................................................................................................
Operating income (loss)................................................................................................................
Ordinary income (loss)..................................................................................................................
Net Income (loss)..........................................................................................................................
Net income (loss) per share (¥)....................................................................................................
(Note) Revision of consolidated business forecasts during this period: Yes

1

470,000
10,00026,00012,000
26.56

3.9
10.1
(0.4)
(2.7)

4. Other Information
1) Transfer of important subsidiaries during the period under review: None
(Transfers of certain subsidiaries resulting in changes in the scope of consolidation)2) Adoption of simplified accounting methods: None
3) Changes in accounting policies, changes in accounting estimate or restatement of corrections:
1. Changes in accounting policies following revisions to accounting standards: Yes
2. Changes other than 1: Yes
3. Changes in accounting estimates: Yes
4. Restatement of corrections: None4)

Number of shares outstanding (ordinary shares)
September 30, 2012

March 31, 2012

Number of shares issued at end of period(including treasury shares)...................................................................

483,478,398

483,478,398

Number of treasury shares at end of period...........................................

31,756,229

31,666,371

April 1 – September 30, 2012
Average shares outstanding during period..................................................

451,739,787

April 1 – September 30, 2011
451,956,812(NOTE)
1. These quarterly financial results are not subject to quarterly review procedures. At this time of disclosure of these financial results, the quarterly
financial statement review procedures based on the Financial Instrument and Exchange Law have not been completed.
2. Forecasts, etc., recorded in this document contain forward-looking statements that are based on management’s estimates, assumptions andprojections at the time of publication. A number of factors could cause actual results to differ materially from expectations.

21. Consolidated business results for this period
Note: All comparisons are with the same period of the previous fiscal year, unless stated otherwise.

(1)Consolidated operating results
Overview of results
During the first six months of the fiscal year ending March 2013 (April 1-September 30, 2012), the Japanese
economy continued to face great strain due to the prolonged public debt crisis in Europe, continued appreciation of
the yen against other currencies, and the slowdown of the Chinese economy. The MGC Group achieved a slightincrease in net sales. Aromatic chemicals and electronic materials suffered reductions in sales volumes due to a
slowdown in demand. Methanol and ammonia derivatives saw declines in market prices. Positive contributions
included increases in the sales volumes of electronic chemicals and polycarbonates, as well as favorable
developments in methanol sales price.
Operating income suffered a loss due to narrower margins resulting from declines in the sales prices of chemicals
in general and lower sales volumes for polycarbonate sheets/films and electronic materials.
Equity in earnings of affiliates was at the prior-year level, thanks to the excellent sales performance achieved byoverseas methanol producing companies, which benefited from high methanol market prices. Ordinary income waslower.
Net income was lower than the prior-year level due to extraordinary losses, including losses on valuation of
investment securities.
In the first six months of fiscal 2012, the MGC Group achieved ¥232.7 billion in consolidated net sales, an increaseof ¥2.7 billion (1.2%). Consolidated operating income was ¥3.9 billion, a decline of ¥3.5 billion (47.6%). Equity inearnings of affiliates was ¥9.9 billion, a decline of ¥0.4 billion (4.6%). Consolidated ordinary income fell by ¥4.9 billion(30.7%) to ¥11.2 billion. Consolidated net income was ¥8.1 billion, a drop of ¥3.9 billion (33.0%).

Results by business segment
Natural Gas Chemicals Company
The methanol business marked higher net sales and lower earnings. Despite favorable developments in sales
prices, purchasing costs increased due to an increase in market price.
Methanol and ammonia derivatives suffered a decline in revenue because of lower sales prices for MMA-based
products and a reduction in the sales volume of neopentylglycol due to the slowdown of the Chinese economy.
Earnings from these derivatives, however, remained at the prior-year level.
The enzyme and coenzyme business recorded prior-year-level earnings, despite suffering lower revenue due to
weak coenzyme Q10 sales.
Crude oil and other energy increased in both revenue and earnings due to the favorable development of crude oil
sales.
In the six-month period under review, the Natural Gas Chemicals Company achieved consolidated net sales of¥77.1 billion, an increase of ¥3.0 billion (4.1%), and an operating loss of ¥0.6 billion, a drop of ¥1.0 billion.
Due to the strong performance of overseas methanol producing companies, an equity in earnings of affiliates of¥7.9 billion was posted, resulting in a consolidated ordinary income of ¥6.5 billion, a decline of ¥1.5 billion (19.5%).

3

Aromatic Chemicals Company
Specialty aromatic chemical products suffered losses in both revenue and earnings. Negative factors included
reductions in sales volumes for Nylon-MXD6, aromatic aldehydes for overseas customers and those formeta-xylenediamine for the domestic market.
The purified isophthalic acid business suffered reductions in both revenue and earnings because sales prices
declined despite a prior-year-level sales volume.
In the first six months of fiscal 2012, Aromatic Chemicals Company achieved consolidated net sales of ¥64.0 billion,a decline of ¥3.5 billion (5.2%), an operating loss of ¥0.6 billion, a drop of ¥1.3 billion, and an ordinary loss of ¥1.1
billion, a reduction of ¥1.3 billion.

Specialty Chemicals Company
Inorganic chemicals improved in both terms of revenue and earnings. Positive contributions included a higher sales
volume for hydrogen peroxide compared with the figure for the prior-year period affected by the major natural disasterin March 2011.
Electronic chemicals achieved increases in both revenue and earnings. This positive trend was primarily due to
growing sales of super-pure hydrogen peroxide and hybrid chemicals for semiconductors.
Engineering plastics achieved growth in both revenue and earnings. While polyacetal suffered from lower earnings,
polycarbonates achieved a higher sales volume compared with the prior-year number affected by the March 11
disaster in East Japan.
Polycarbonate sheets and films suffered losses in both revenue and earnings. This is because, despite an increasein the sales volume of hard-coated sheets, which are used as an alternative to smartphone cover glass, sales volume
of films for use in flat panel displays were lower.
In the first half of fiscal 2012, the Specialty Chemicals Company achieved consolidated net sales of ¥64.6 billion, an
increase of ¥4.9 billion (8.3%) and an operating income of ¥4.4 billion, an increase of ¥0.7 billion (19.3%). Due to ¥0.9
billion equity in earnings of affiliates, the Company achieved an ordinary income of ¥4.5 billion, an increase of ¥0.1
billion (3.0%).

Information & Advanced Materials Company
Electronic materials posted drops in both revenue and earnings. For BT materials used for semiconductor
packaging, smartphone-related applications steadily grew in both revenue and earnings, whereas general-purpose
products suffered from continued low demand levels.
Thanks to strong sales, mainly in the domestic and overseas food markets, oxygen absorbers such as AGELESS®
achieved prior-year levels in both revenue and earnings.
In the half-year period under review, the Information & Advanced Materials Company achieved consolidated net
sales of ¥26.4 billion, a decline of ¥1.7 billion (6.2%), an operating income of ¥2.0 billion, a drop of ¥1.3 billion (40.8%),
and an ordinary income of ¥1.9 billion, a reduction of ¥1.4 billion (43.4%).

Other
In the first six months of fiscal 2012, the other business segment achieved consolidated net sales of ¥0.3 billion, adecline of ¥0.0 billion (0.7%), an operating income of ¥0.1 billion, a drop of ¥0.0 billion (41.0%), and an ordinary
income of ¥0.7 billion, a decline of ¥0.1 billion (20.3%).

4

(2) Consolidated financial position
At the end of the first six months of fiscal 2012, the MGC Group had ¥611.7 billion in total assets, an increase of¥16.4 billion from the end of fiscal 2011.
Current assets increased by ¥6.9 billion to ¥260.9 billion, primarily due to a decline in short-term investments
securities and increases in cash and deposits as well as merchandise and finished goods.
Noncurrent assets increased by ¥9.5 billion to ¥350.7 billion. Property, plant and equipment rose by ¥6.6 billion to¥197.8 billion thanks to increases in buildings and structures and machinery, equipment and vehicles despite adecline in construction in progress. Investments and other assets were ¥149.0 billion, an increase of ¥2.3 billion, due
to an increase in deferred income taxes, the posting of equity in earnings, and an increase in investment securities
resulting from exchange effects.
Liabilities increased by ¥10.8 billion to ¥314.0 billion from the end of fiscal 2011.
Current liabilities increased by ¥7.2 billion to ¥200.7 billion, due to a reduction in short-term loans payable and anincrease in trade notes and accounts payable.
Noncurrent liabilities increased by ¥3.5 billion to ¥113.2 billion, primarily due to an increase in long-term loans
payable.
Net assets increased by ¥5.5 billion to ¥297.6 billion. This was because, despite a reduction of ¥2.1 billion in
valuation difference on available-for-sale securities, retained earnings rose by ¥5.4 billion and foreign currencytranslation adjustment increased by ¥2.3 billion due to the weak yen. As of September 30, 2012 the shareholders’equity ratio was 47.0%.

(3) Consolidated business forecasts
The MGC Group faces increasing uncertainty due to the prolonged public debt crisis in Europe, appreciation of the
yen against other currencies, and the slowdown of the Chinese economy. In the second half of fiscal 2012,polycarbonates will likely suffer a decline in earnings in China, and it is anticipated that BT materials forgeneral-purpose semiconductors will show lower sales volumes while some of the MGC products, such as hybrid
chemicals for semiconductors, are expected to be successful, as they were in the first half of the year. For full-year
fiscal 2012, therefore, the MGC group expects a decline in operating income.
Full-year net income is expected to be substantially lower than our previous forecast. This is because expected
losses in unsuccessful businesses have been estimated where possible and included in the business forecasts, inaccordance with the policy of restructuring loss-making businesses stated in the Med-term Management Plan “MGC
Will2014.”
These business forecasts assume exchange rates of ¥80=$1 and ¥100= €1.

Revision of consolidated business forecasts
Fiscal year ending March 31, 2013 (April 1, 2012 − March 31, 2013)(Millions of yen)
Net sales

OperatingincomeOrdinary income

Net income

Net income pershare (¥)

Previously announced forecasts (A)480,000

13,00028,00023,00050.90

Revised forecasts (B)470,000

10,00026,00012,00026.56

Change (B – A)

(10,000)(3,000)(2,000)(11,000)−

Change (%)(2.1)(23.1)(7.1)(47.8)−

Results for the previous period(ended March 31, 2012)

452,217

9,083

26,116

12,32727.28

5

2. About figures indicated in this summary (including notes)
Changes in accounting policies, changes in accounting estimates or restatement of corrections(Change in the depreciation method)
Starting in the first quarter of fiscal 2012, MGC has switched the method of depreciation of property, plant andequipment, not including buildings and structures (other than accompanying facilities) and leased assets, from thetraditional fixed-rate method to the straight-line method.
This change was made following an internal study of the use of property, plant and equipment, which forms thebasis of the MGC Mid-term Management Plan. This study shows that production outputs and operating ratios willremain stable in the long term. MGC has, therefore, decided that the straight-line method better reflects the use of
these assets within MGC.
Compared with the corresponding figures calculated by the traditional method, operating income for the first half offiscal 2012 increased by ¥1,904 million, while the ordinary income, and income before income taxes and minority
interests each increased by ¥1,911 million.

63. Consolidated Quarterly Financial Statements(1) Consolidated Quarterly Balance Sheets
Millions of yen, rounded down
As of March 31, 2012

As of September 30, 2012

Cash and deposits...........................................................................

27,43833,419Trade notes and accounts receivable.............................................

122,054

124,765ASSETS
Current assets

Short-term investments securities...................................................

10,241

5,140

Merchandise and finished goods....................................................

42,761

48,400Work in progress.............................................................................

10,7329,610

Raw materials and supplies............................................................

22,59325,255

Other.................................................................................................

18,995

15,169Allowance for doubtful accounts.....................................................

(779)

(798)

Total current assets.........................................................................

254,037

260,962

Buildings and structures, net........................................................

49,79355,740Machinery, equipment and vehicles, net......................................

59,70772,534

Other, net.......................................................................................

81,677

69,586

Total property, plant and equipment.........................................

191,178

197,861

Goodwill.........................................................................................

104

113

Other..............................................................................................

3,171

3,682

Total intangible assets ...............................................................

3,275

3,796

Investment securities....................................................................

132,935

133,231

Other..............................................................................................

14,925

16,669Allowance for doubtful accounts...................................................

(1,101)(808)

Noncurrent assets
Property, plant and equipment

Intangible assets

Investments and other assets

Total investments and other assets...........................................

146,758

149,092

Total noncurrent assets.....................................................................

341,212350,750

Total assets........................................................................................

595,250

611,7137

Consolidated Quarterly Balance Sheets (contd.)
Millions of yen, rounded down
As of March 31, 2011

As of September 30, 2012

Trade notes and accounts payable..................................................

69,42782,509

Short-term loans payable..................................................................

90,511

82,208

Income taxes payable.......................................................................

1,599

713

Provision............................................................................................

3,693

4,994

Other..................................................................................................

28,23230,334

Total current liabilities...................................................................

193,464

200,759

LIABILITIESCurrent Liabilities

Noncurrent liabilities

Bonds payable...................................................................................

15,00015,000Long –term loans payable................................................................

56,27760,541

Provision for retirement benefits.......................................................

7,095

7,314

Other provision..................................................................................

1,451

1,557

Asset retirement obligations.............................................................

3,512

3,545

Other..................................................................................................

26,33625,305

Total noncurrent liabilities............................................................

109,673

113,265

Total liabilities...............................................................................

303,138

314,024

Capital stock......................................................................................

41,97041,970Capital surplus...................................................................................

35,59335,594Retained earnings.............................................................................

245,083

250,489

Treasury stock...................................................................................

(8,039)(8,087)

Total shareholders’ equity............................................................

314,607319,966

Valuation difference on available-for-sale securities.......................

3,468

1,298

Deferred gains or less on hedges....................................................

(177)

(208)

Revaluation reserve for land.............................................................

206

206

Foreign currency translation adjustment..........................................

(36,417)(34,042)

Total accumulated other comprehensive income............................

(32,920)(32,746)

NET ASSETS
Shareholders’ equity

Accumulated other comprehensive income

Minority interests...............................................................................

10,424

10,467

Total net assets............................................................................

292,111297,688

Total liabilities and net assets..................................................

595,250

611,7138

(2) Consolidated Quarterly Statements of Income
Millions of yen, rounded down
April 1 - September 30
2011April 1 - September 30
2012

Net sales.............................................................................................

230,076

232,789

Cost of sales...................................................................................

193,803

200,783

Gross profit .........................................................................................

36,27332,005

Selling, general and administrative expenses..............................

28,772

28,072

Operating income...............................................................................

7,500

3,933

Non-operating income

Interest income...............................................................................

66

61

Dividend income.............................................................................

938

806

Equity in earnings of affiliates........................................................
Other...............................................................................................

10,417
942

9,937
966

Total non-operating income.......................................................

12,365

11,771

Interest expense.............................................................................

974

1,233

Foreign exchange losses...............................................................

571

887

Non-operating expenses

Personnel expenses for seconded employees............................

771

767

Other...............................................................................................

1,344

1,580

Total non-operating expenses...................................................

3,661

4,469

Ordinary income.................................................................................

16,204

11,235Gain on sales of noncurrent assets..............................................

-

180

Extraordinary income

Insurance income...........................................................................

440

137

Gain on change in equity...............................................................

17-

Total extraordinary income.........................................................

457

318

Loss on valuation of investment securities...................................

1,587

1,650

Provision for compensation expenses..........................................

-

838

Provision for loss on business liquidation.....................................

-

828

Environmental improvement expensive........................................

488

328

Loss on litigation.............................................................................

-

151

Extraordinary losses

Impairment loss..............................................................................

19

32

Loss on disaster.............................................................................

557-

Total extraordinary losses..........................................................

2,653

3,829

Income before income taxes and minority interests.........................

14,008

7,724

Income taxes, etc.................................................................................

1,262

(741)

Net income before minority interests.................................................

12,746

8,465

Minority interests in income...............................................................

636

349

Net income.........................................................................................

12,1098,116

9

(Consolidated Quarterly Statements of Comprehensive Income)April 1 - September 30
2011
Income before minority Interests........................................................................................12,746

Millions of yen, rounded down
April 1 - September 30
2012

8,465

Other comprehensive Income
Valuation difference on available-for-sale securities.....................................................(2,325)(2,096)

Deferred gains or losses on hedges.............................................................................. (205)

(34)

67
Foreign currency statements translation adjustment....................................................
Share of other comprehensive income of associates(304)
accounted for using equity method...............................................

491
1,897

Total other comprehensive Income............................................................................(2,766)

257

Comprehensive Income.......................................................................................................... 9,980

8,723

Total comprehensive Income Attributable to
Owners of the parent.........................................................................
Minority interests.................................................................................................................

10

9,336

8,290

643

432

(4) Consolidated Statements of Cash Flows
Millions of yen, rounded down
April 1 - September 30
2011April 1 - September 30
2012

Income before income taxes and minority interests................................

14,008

7,724

Depreciation and amortization..................................................................

13,432

10,776

Loss (gain) on disposal of noncurrent assets..........................................

281

191

Amortization of goodwill............................................................................

(51)

(36)

Insurance income......................................................................................

(505)

(149)

Loss on disaster........................................................................................

557-

Loss on litigation........................................................................................

-

151

Increase (decrease) in provision for loss on businessliquidation...................................................................................................

-

828

Increase (decrease) in provision for compensation expenses...............

-

668

Impairment losses.....................................................................................

19

32

Equity in (earnings) losses of affiliates.....................................................

(10,417)(9,937)

Increase (decrease) in allowance for doubtful accounts.........................

(27)

(275)

Net cash provided by (used in) operating activities

Increase (decrease) in provision for retirement benefits.........................

754

219

Interest and dividends income..................................................................

(1,005)(867)Interest expenses......................................................................................

974

1,233

Loss (gain) on valuation of short-term and long-term
1,587
investment securities..........................................................................................................

1,655

Environment improvement expenses......................................................

488

328

Decrease (increase) in trade notes and accounts receivable................

74(3,383)

Decrease (increase) in inventories...........................................................

(8,850)(7,070)

Increase (decrease) in trade notes and accounts payable.....................

8,347

13,015

Increase (decrease) in accrued consumption taxes...............................

(1,283)

358

Increase (decrease) in provision for directors’ retirement
benefits......................................................................................................

57

22

Other, net...................................................................................................

810

2,261

Subtotal.................................................................................................

19,252

17,746

Interest and dividends income received..................................................

1,007

868

Proceeds from dividends income from affiliates accounted forby equity method.......................................................................................

7,750

7,417

Interest expenses paid..............................................................................

(957)(1,216)

Income taxes (paid) refund.......................................................................

(2,034)(819)

Proceeds from insurance income............................................................

505

930

Payments for loss on disaster..................................................................

(1,571)(75)

Net cash provided by (used in) operating activities......................

23,95324,851

11

Consolidated Statements of Cash Flows (contd.)
Millions of yen, rounded down
April 1 - September 30,
2011

April 1 - September 30,
2012

Net cash provided by (used in) investing activities
Purchase of short-term investment securities.........................................

(121)

(9)

Proceeds from sales of short-term investment securities.......................

220

115

Purchase of noncurrent assets................................................................

(20,203)(15,069)

Proceeds from sales of noncurrent assets..............................................

315

355

Purchase of investment securities...........................................................

(287)

(581)

Proceeds from sales of investment securities.........................................

274

0

Other, net...................................................................................................

(445)

(357)

Net cash provided by (used in) investing activities......................

(20,248)(15,546)

Net increase (decrease) in short-term loan payable...............................

821

1,987

Proceeds from long-term loans payable..................................................

1,783

7,316

Payment of long-term loans payable.......................................................

(2,444)(13,581)

Net cash provided by (used in) financing activities

Redemption of bonds................................................................................

(20,000)-

Purchase of treasury stock.......................................................................

(118)

(48)

Cash dividends paid..................................................................................

(1,808)(2,710)Cash dividends paid to minority shareholders.........................................

(528)

(401)

(494)

(848)

Net cash provided by (used in) financing activities...........

(22,789)(8,286)

Effect of exchange rate change on cash and cash
equivalents.....................................................................................

(935)

(403)

Net increase (decrease) in cash and cash equivalents...........

(20,019)614

Cash and cash equivalents at beginning of period.................

46,76835,701

Cash and cash equivalents at end of period.............................

26,74836,315

Other, net...................................................................................................

12

4. Consolidated Quarterly Segment Information(1) Six-month period ended September 30, 2011 (April 1 – September 30, 2011)
1. Revenue and earnings by segment
Millions of yen, rounded down
Natural gas
chemicals

Aromatic
chemicals

Specialty
chemicals

Information
andadvancedmaterials

Other(Note 1)

Adjustment(Note 2)

Consolidated(Note 3)

Sales to outside customers ........................................................................
74,172
67,57859,71528,244366−

230,076

Inter-segment sales ....................................................................................
3,572
827
503

1

39

(4,943)−

Total ....................................................................................................
77,744
68,40560,21828,245406(4,943)230,076

3,394

978

(916)

16,204

Segment income (loss)
8,138
189
[Ordinary income (loss)]....................................................................

4,420

Notes：
1. The ‘Other’ segment includes operations not included in the other segments, such as listed related companies and real estate business.
2. The adjustment amounts are as follows:
The ¥916 million segment loss adjustment consists of ¥204 million loss in inter-segment sales, and ¥712 million loss of overall costs notallocated to segments.
Overall costs include SG&A expenses, financing expenses, and other expenses not allocated to segments.
3. Segment income (loss) is based on ordinary income as provided in the quarterly consolidated statement of income.

(2) Six-month period ended September 30, 2012 (April 1 – September 30, 2012)
1. Revenue and earnings by segment
Millions of yen, rounded down
Specialty
chemicals

Information
andadvancedmaterials

Other(Note 1)

Adjustment(Note 2)

Consolidated(Note 3)

Sales to outside customers ........................................................................
77,17964,06664,68526,494363−

232,789

Inter-segment sales ....................................................................................
4,027
1,041
471

0

26

(5,567)−

Total ....................................................................................................
81,207
65,107
65,156

26,495390(5,567)

232,789

1,922

780

(1,436)

11,235Natural gas
chemicals

Aromatic
chemicals

Segment income (loss)
6,549(1,131)[Ordinary income (loss)]....................................................................

4,551

Notes：
1. The ‘Other’ segment includes operations not included in the other segments, such as listed related companies and real estate business.
2. The adjustment amounts are as follows:
The ¥1,436 million segment loss adjustment consists of ¥44 million loss in inter-segment sales, and ¥1,391 million loss of overall costs
not allocated to segments.
Overall costs include SG&A expenses, financing expenses, and other expenses not allocated to segments.
3. Segment income (loss) is based on ordinary income as provided in the quarterly consolidated statement of income.

13