Summary of Financial Results FY2016
May 10, 2017
Mitsubishi Gas Chemical, Inc (TSE 4182)(Millions of yen, rounded down)
1.Consolidated Financial Results for the Fiscal Year 2016 (from April 1, 2016 to March 31, 2017)(1)Summry of Income Statement (April 1, 2016- March 31, 2017)
FY2015FY2016

Change (%)

Net Sales

593,502556,480(6.2)

Operating income

34,01843,762

28.6

Ordinary income

45,43262,37837.3

Net income attributable to owners of the parent

34,13447,95840.5

Comprehensive income

11,21760,937443.2

Net income per share (Yen) *153.85221.57*The Company conducted a consolidation of shares at a ratio of one share for every two shares effective October 1,
2016. In Accordance with it, Net income per share are caluculated based on the assumption that the shareconsolidation had been carried out at the beginning of the previous fiscal year.
Note: Equity in earnings of affiliates: FY2015 JPY16,683 million; FY2016 JPY21,074 million(2) Financial Position
As of Mar. 31, 2016

As of Mar. 31, 2017

Total assets

739,582741,639

Net assets

423,135

476,749

Shareholders equity

376,944428,091

51.0

57.7

1707.01

1983.60

Equity Ratio(%)
Bookvalue per share (Yen) **The Company conducted a consolidation of shares at a ratio of one share for every two shares effective October 1,
2016. In Accordance with it, bookvalue per share are caluculated based on the assumption that the shareconsolidation had been carried out at the beginning of the previous fiscal year.
(3) Cash FlowsFY2015FY2016

Cash flow from operating activities

84,671

82,711

Cash flow from investing activities(31,922)(30,342)

Cash flow from financing activities(47,335)(60,994)

Cash and cash equivalents at end of period

75,82867,177

2. Dividends
FY2015FY2016FY2017 (forecast)Interim dividend per share (Yen)

8.00

8.00

22.00

Year-end dividend per share (Yen)

8.00

22.00

22.00

Annual Dividend per share (Yen)

16.00

Total dividend payment

7,066

8,201

Dividend payout ratio (consolidated, %)

20.7

17.2

Dividend to net assets ratio (consolidated, %)

1.9

2.1

-

44.00

22.1

*As the Company conducted a consolidation of shares at a ratio of one share for every two shares effective October
1, 2016, figures for the Year-end dividends per share for FY 2016 are amounts that take into account theconsolidation of shares, and total annual dividends are shown as “-.” Year-end dividends per share for FY 2016
without taking into account the consolidation of shares are 11 yen, and annual dividends per share are 19 yen.

3. Consolidated Business Forecasts for FY2017 (April 1, 2017 - March 31, 2018)
First Half

Full Year

Y/Y Change (%)

Net Sales

280,000

580,000

4.2

Operating income

18,00037,000(15.5)

Ordinary income

27,00055,000(11.8)Net income attibutable to owners of the parent

21,00043,000(10.3)Net income per share (Yen)

97.31

199.24

4. Number of Shares Outstanding (Common Stock)
FY2015FY2016

Nmber of shares outstanding at term end (including tresury stock)241,739,199

241,739,199

Number of shares of treasury stock at term-end

20,917,856

25,923,628

Average number of shares

221,866,819

216,444,168*The Company conducted a consolidation of shares at a ratio of one share for every two shares effective October 1,
2016. In Accordance with it, number of shares outstanding at term end, number of shares of treasury stock at theterm-end, and average shares outstanding during period are calculated based on the assumption that the shareconsolidation had been carried out at the beginning of the previous fiscal year.

Reference: Outline of Non-consolidated Financial Results
1. Non-consolidated Financial Results for the Fiscal Year 2016 (from April 1, 2016 to March 31, 2017)(1) Non-consolidated Operating Results
FY2015FY2016

Change (%)

Net Sales

311,118

299,234(3.8)

Operating income

13,861

17,583

26.9

Ordinary income

33,90831,409(7.4)

Net income

30,86827,996(9.3)

Net income per share (Yen) *139.13129.35*The Company conducted a consolidation of shares at a ratio of one share for every two shares effective October 1,
2016. In Accordance with it, Net income per share are caluculated based on the assumption that the shareconsolidation had been carried out at the beginning of the previous fiscal year.

(2) Non-consolidated Financial Position
As of Mar. 31, 2016

As of Mar. 31, 2017

Total assets

413,583

426,324

Net assets

229,025

251,521

Shareholders equity

229,025

251,521

55.4

59.0

1037.151165.45

Equity Ratio(%)
Bookvalue per share (Yen) **The Company conducted a consolidation of shares at a ratio of one share for every two shares effective October 1,
2016. In Accordance with it, bookvalue per share are caluculated based on the assumption that the shareconsolidation had been carried out at the beginning of the previous fiscal year.

2. Non-consolidated Forecasts for the Fiscal Year 2017 (from April 1, 2017 to March 31, 2018)
First Half
Net Sales

Full Year

Y/Y Change (%)

160,000

330,000

10.3

Operating income

7,000

16,000(9.0)

Ordinary income

20,00035,00011.4

Net income attibutable to owners of the parent

19,00032,00014.3

Net income per share (Yen)

88.04

148.27

1. These financial statements are exempt from audit procedure.
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 todiffer materially from expectations.

Consolidated Financial Statements
1. Consolidated Balance Sheets(Millions of yen, rounded down)
As of Mar. 31, 2016 As of Mar. 31, 2017
ASSETS
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
Defered tax assets
Other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
Land
Lease assets, net
Construction in progress
Other, net
Total property, plant and equipment
Intangible assets
Goodwill
Lease assets
Software
Other
Total intangible assets
Investments and other assets
Investment securities
Long-term loans receivable
Defered tax assets
Assets for retirement benefits
Other
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets

1

84,097
136,401
121
57,98010,98531,148
4,585
16,962(1,043)
341,237

75,017
138,410
139
51,671
10,65232,306
5,818
13,725(1,067)
326,674

73,902
81,221
38,18815,242
16,672
6,107
230,525

79,594
81,147
38,114546
12,233
6,421
218,057

4,543
5
1,651
2,540
8,740

4,258
22
1,722
2,367
8,370

150,431
1,538
2,418
5,131
(441)
159,079
398,344739,582

178,913
2,658
2,161
12
5,475
(683)
188,537
414,965
741,639

Consolidated Balance Sheets (continued)(Millions of yen, rounded down)
As of Mar. 31, 2016 As of Mar. 31, 2017
LIABILITIESCurrent liabilities
Trade notes and accounts payable
Short-term loans payable
Current portion of bonds
Accrued expenses
Lease obligations
Income taxes payable
Defered tax liabilities
Provision for bonuses
Provision for enviromental improvements
Provision for business structure improvements
Privision for loss on liquidation of subsidiaries and affiliates
Asset retirement obligations
Other
Total current liabilities
Noncurrent liabilities
Bonds payable
Long –term loans payable
Lease obligations
Defered tax liabilities
Provision for directors' retirement benefits
Provision for enviromental improvements
Provision for business structure improvements
Privision for loss on liquidation of subsidiaries and affiliates
Other 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 income
Valuation 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

260,81993,911
15,00014,772
1,538
3,365
212
5,345
332
336
112
18,929214,676

68,506
74,66915,171
100
3,394
256
5,351
1
132
624
98
20,119188,426

10,00046,947
14,02912,426
554
315
1,241
181
293
9,078
3,800
2,902
101,771
316,447

10,00033,495447
17,382
387
271
1,053
200
5,936
3,832
3,455
76,464
264,890

41,97035,603
311,250(15,566)
373,258

41,97035,602360,833(21,829)
416,576

9,816
(3)
222
(4,613)(1,736)
3,686
46,190423,135
739,582

18,101(0)
222(6,271)(538)
11,514
48,658476,749
741,639

2. Consolidated Statements of Income(Millions of yen, rounded down)
FY2015FY2016
593,502556,480
470,455
425,231
123,046
131,249
89,02887,48634,01843,762

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
Other
Total non-operating income
Non-operating expenses
Interest expense
Foreign exchange losses
Personnel expenses for seconded employees
Loss on disposal of noncurrent assets
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Subsidy income
Gain on sales of investment securities
Gain on sales of noncurrent assets
Compensation income
Insurance income
Reversal of provision for business structure improvement
Total extraordinary income
Extraordinary losses
Impairment losses
Loss on reduction of noncurrent assets
Loss on business withdrawal
Loss on liquidation of subsidiaries and affiliates
Loss on sales of investment securities
Loss on disposal of noncurrent assets
Business structure improvement expenses
Provision for compensation expenses
Loss on cancel of lease contracts
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

512
2,223
16,683
2,479
21,898423
1,789
21,0742,569
25,857

2,494
3,860
1,240
904
1,984
10,48445,432

1,346
1,219
1,646
1,102
1,925
7,240
62,378

301
3,444
155
136
122
4,160

1,015
761
579
201
2,557

1,529
1,101
170
541
270
147
3,759
45,833
7,084
38,748
4,614
34,134

1,124
987
870
667
127
111
3,888
61,048
7,675
53,372
5,414
47,958(Consolidated Statements of Comprehensive Income)(Millions of yen, rounded down)
FY2015FY201638,74853,372

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

4(10,746)(3)(6,928)(3,795)(6,057)(27,530)
11,217
9,151
2,066

8,264
3
(2,192)
2,113
(625)
7,564
60,93756,5264,410

3. Consolidated Statement of Cash Flows(Millions of yen, rounded down)
FY2015FY2016
Net cash provided by (used in) operating activities:
Income before income taxes, etc.
Depriciation and amortization
Loss on sale/disposal of property, plant and equipment
Amortization of goodwill
Equity in earings of affiliates
Impairment loss
Loss on reduction of noncurrent assets
Loss on business withdrawal
Loss on liquidation of subsidiaries and affiliates
Loss on cancellation of lease
Business structure improvement expenses
Reversal of provision for business structure improvement
Insurance income
Subsidy income
Compensation income
Decrease (increase) in allowance for doubtful accounts
Increase in net defined benefit liability
Interest and dividend income
Interest expences
Gain on sale of short-term investments and investments in securities
Gain on valuation of short-term investments and investments in securities
Decrease in trade notes and accounts receivable
Decrease in inventories
Decrease in trade notes and accounts payable
Increase (decrease) in accrued consumption taxes
Increase (decrease) in provision for directors' retirement benefits
Other, net
Sub totalInterest and dividend received
Dividend received from affiliates accounted for by the equity method
Interest paid
Income taxes paid
Subsidy received
Insurance received
Net cash provided by (used in) operating activities

545,833
26,705903
280(16,683)
1,529
1,101
147
541
(122)
(136)
(301)
(111)
(33)
(2,735)2,494(3,444)19
12,9007,790(15,215)
(542)
79
3,555
64,557
2,689
18,692(2,506)
(874)
1,909
203
84,671

61,04825,631
538
275(21,074)
1,124
987
870
667
(59)
(1,015)(201)
246(1,158)(2,213)
1,346
(690)
240
(3,930)
3,948
8,416
(863)
(141)
(435)
73,555
2,409
12,288(1,391)(5,226)1,015
59
82,711

Consolidated Statement of Cash Flows (continued)(Millions of yen, rounded down)
FY2015FY2016
Net cash provided by (used in) investing activities
Purchase of noncurrent assets
Proceeds from sales of noncurrent assets
Purchase of investment securities
Proceeds from sales of investment securities
Payments of loans receivableCollection of loans receivable
Purchase of investments in subsidiaries resulting in change in scope of consolidation
Other, net
Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities
Net increase (decrease) in short-term loan payable
Proceeds from long-term loans payable
Payment of long-term loans payable
Repayment of corporate bonds
Purchase of treasury stock
Cash dividends paid
Cash dividends paid to non-controlling interests
Other, net
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Increase (decrease) in cash and cash equivalents resulting from change in scope of
consolidation
Cash and cash equivalents at end of period

6(29,072)457(7,338)
4,257(6,668)
7,085(643)(31,922)(32,291)875(2,308)2,482(2,703)
2,880
(313)
1,037
(30,342)(12,639)
7,136(25,092)(7,437)(6,694)(1,238)(1,368)(47,335)(2,255)
3,157
72,678(4,840)1,741(27,828)(15,000)(6,266)(6,986)(1,654)(158)(60,994)(48)(8,673)75,828(7)

2275,82867,177

4. Segment Information(Millions of yen, rounded down)

Sales:
Sales to third parties
Inter segment sales
Ordinary income
Segment aseets
Others:Depreciation and amortization
Amortization of goodwill
Interest income
Interest expenses
Equity in earnings of affiliates
Investment in affiliates accounted
for by the equity method
Capital expenditures

FY2015
Information
Specialty&
Chemicals
Advanced

NaturalGas
Chemicals

Aromatic
Chamials

165,497
10,202
175,699
13,904
193,931203,3482,546
205,895
13,710195,454

168,721
1,524
170,246
15,593
199,925

55,251
1
55,252
3,854
64,386

684
109
793
283
45,370(14,385)(14,385)(1,914)40,513

593,502593,50245,432739,582

6,176
94
809
11,301

8,298
242
262
1,058
(38)

8,882
0
114
1,126
5,259

3,001
55
210
-

11
37
2
14
160

336
(16)
(724)
-

26,705
280
512
2,494
16,68359,430555

16,678

-

3,135

1,367

81,167

5,306

10,630

9,904

3,885

308

477

30,512

Other

Adjustments Consolidated(Millions of yen, rounded down)

Sales:
Sales to third parties
Inter segment sales
Ordinary income
Segment aseets
Others:Depreciation and amortization
Amortization of goodwill
Interest income
Interest expenses
Equity in earnings of affiliates
Investment in affiliates accounted
for by the equity method
Capital expenditures

FY2016
Information
Specialty&
Chemicals
Advanced

NaturalGas
Chemicals

Aromatic
Chamials

142,901
10,656
153,557
14,287
182,089

191,933
2,546
194,480
17,533
192,047

170,894
1,326
172,220
26,809209,897

50,1972
50,2006,151
73,404

553
68
622
328
38,783(14,600)(14,600)(2,730)45,417556,480
556,480
62,378
741,639

5,068
101
152
12,775

8,506
241
187
799
7

8,672
0
118
777
6,835

3,027
23
138
1,229

20
33
1
13
225

335
(8)
(535)
-

25,631
275
423
1,346
21,07464,499567

21,02910,1393,341

873

100,450

9,009

10,556

8,172

6,674

7

589

35,0107

Other

Adjustments Consolidated

FY2016 Outline of Consoliodated Results(Billions of yen, rounded down)

Net sales
Natural Gas Chemicals
Aromatic Chemicals
Specialty Chemicals
Information and Advanced Materials
Other and Adjustment
Operating income (loss)
Natural Gas Chemicals
Aromatic Chemicals
Specialty Chemicals
Information and Advanced Materials
Other and Adjustment
Non-operating profit
Ordinary income
Natural Gas Chemicals
Aromatic Chemicals
Specialty Chemicals
Information and Advanced Materials
Other and Adjustment
Extoraordinary income and loss, net
Income before income taxes, etc.
Net income attributable to owners of the parent

FY2015FY2016

ChangeChange(%)

FY 2017
forecast

593.5
175.6
205.8
170.2
55.2
(13.5)
34.0
4.1
15.2
13.0
4.0
(2.4)
11.4
45.4
13.9
13.7
15.5
3.8
(1.6)
0.4
45.8
34.1

556.4
153.5
194.4
172.2
50.2
(13.9)
43.7
2.5
18.3
21.6
4.8
(3.6)
18.6
62.3
14.2
17.5
26.8
6.1
(2.4)
(1.3)
61.0
47.9

(37.0)(22.1)(11.4)
1.9
(5.0)
(0.3)
9.7
(1.5)
3.0
8.5
0.7
(1.1)
7.2
16.9
0.3
3.8
11.2
2.2
(0.7)
(1.7)
15.2
13.8

(6.2)
(12.6)
(5.5)
1.2
(9.1)
28.6
(38.3)
20.2
65.6
19.3
63.1
37.3
2.8
27.9
71.9
59.6
33.2
40.5

580.0
161.5
209.8
173.9
49.8
(15.1)
37.0
1.6
18.3
16.4
4.6
(4.1)
18.0
55.0
14.3
17.3
20.1
5.9
(2.8)
55.0
43.0

Accounting Fundamentals

Investments(Billions of yen)
Depriciation & amortization(Billions of yen)
R&D expenditures(Billions of yen)
Number of Staff
ROA (Ordinary income)ROE (Net income)Excahnge Rate
(JPY/USD, Average)
Methanol (USD/MT, Asian
average spot price)First half
Full year
First half
Full year
First half
Full year
Year-end

First half
Second halfFirst half
Second half

FY2013

FY2014FY2015

13.8
25.4
11.4
23.5
8.0
16.1
5,445
4.8%
5.0%
99
102
375
449

10.3
22.2
11.5
23.7
8.0
16.8
8,254
5.8%
12.6%
103
117
432
358

14.9
30.5
13.1
26.7
9.2
18.9
8,176
5.9%
9.0%
122
118
301
230

8

FY2017
forecast
13.7
18.0
35.0
42.0
12.2
13.0
25.6
27.0
9.2
10.5
19.2
21.0
8,034
8,224
8.4%
7.2%
11.9%
9.7%
105
110
112
110
230
325
327
305

FY2016

Qualitative Information
Consolidated Business Results
Overview of Results(Billions of yen)
Apr.1,2015-

Apr.1,2016-

ChangeMar.31,2016

Mar.31,2017(%)

Net sales

593.5

556.4

(6.2)

Operating income

34.0

43.7

28.6

Ordinary income

45.4

62.3

37.3

34.1

47.9

40.5

Net income attributable to owners of
the parent

During the fiscal year 2016 (April 1, 2016-March 31, 2017), the world economy suffered from continued
uncertainty about the future. While the U.S. market showed a recovery trend, the slowdown of China andother emerging economies caused concerns. The Japanese economy continued to experience slow
upswing owing to an ongoing improvement in employment.
The MGC Group suffered a drop in net sales compared with the previous fiscal year. The gain from higher
sales volume for engineering plastics was more than offset by negative contributions such as the stronger
yen.
Group operating income was higher than the prior-year figure. The negative impact of the stronger yen
was more than offset by the improved profitability primarily of engineering plastics, which was due tolower prices of fuels and raw materials among other reasons.
Group ordinary income posted a year-on-year growth. There were positive factors including not only theincrease in operating income, but also higher equity in earnings of affiliates and improvement of exchange
gains and losses.
The Group posted a year-on-year growth in the net income attributable to parent company shareholders.
Despite a decline in gain on sales of investment securities, there was a positive impact of the growth inordinary income.

9

Results by Business Segment
Natural Gas Chemicals(Billions of yen)
Apr.1,2015-

Apr.1,2016-

ChangeMar.31,2016

Mar.31,2017

(%)

Sales

165.4

142.9

(13.7)

Operating income

4.1

2.5

(38.3)

Ordinary income

13.9

14.2

2.8

The methanol business recorded declines in both revenue and earnings. The business suffered fromlower sales prices.
Methanol and ammonia-based chemicals suffered declines in revenue and earnings, due to stronger yen.
Crude oil and other energy sources declined in both revenue and earnings due to lower crude oil prices.

Aromatic Chemicals(Billions of yen)
Apr.1,2015-

Apr.1,2016-

ChangeMar.31,2016

Mar.31,2017

(%)

Sales

203.3

191.9

(5.6)

Operating income

15.2

18.3

20.2

Ordinary income

13.7

17.5

27.9

Specialty aromatic chemical products suffered lower net sales owing to negative factors such as thestronger yen. By contrast, earnings from these products increased year on year due to higher sales
volumes and lower prices of fuels and raw materials.
General-purpose aromatic chemical products suffered a decline in revenue with the discontinued sale ofpurified terephthalic acid and the stronger yen. Earnings from these products grew, however, primarily
due to the improvement in profitability of high-purity Isophthalic Acid.
Despite being affected by the stronger yen, foamed plastics achieved an increase in earnings. Positive
reasons included lower prices of raw materials and the successful sales of high-value products.

10

Specialty Chemicals(Billions of yen)
Apr.1,2015-

Apr.1,2016-

ChangeMar.31,2016

Mar.31,2017

(%)

Sales

168.7

170.8

1.3

Operating income

13.0

21.6

65.6

Ordinary income

15.5

26.8

71.9

Inorganic chemicals suffered reductions in both revenue and earnings despite lower prices of fuels andraw materials. In addition to the stronger yen, a lower sales volume of chemical solutions forsemiconductors and LCD applications explains these results.
The engineering plastics business posted higher earnings. Major positive factors include higher sales
volume and improved profitability resulting from reductions in fuel and raw material prices forpolycarbonate, polyacetal and polycarbonate sheets and films.

Information & Advanced Materials(Billions of yen)
Apr.1,2015-

Apr.1,2016-

ChangeMar.31,2016

Mar.31,2017

(%)

Sales

55.2

50.1

(9.1)

Operating income

4.0

4.8

19.3

Ordinary income

3.8

6.1

59.6

Electronic materials posted a drop in revenue due to reasons including the dissolution of Japan Circuit
Industrial Co., Ltd., the subsidiary producer of printed circuit boards, at the end of September 2016, whileachieving higher earnings primarily due to growth in the sales volume of BT materials for semiconductor
packaging.
Oxygen absorbers such as AGELESS® posted slightly lower earnings levels compared with the previous
year. The appreciation of the yen more than canceled the positive impact of prior-year level developmentsin the sale of products for domestic food applications.

11Consolidated Business Forecasts(Billions of yen)

Net sales

OperatingincomeOrdinary
incomeNet income
attributableto owners of
the parent

FY2016 Results (A)

556.4

43.7

62.3

47.9

FY2017 Forecasts (B)

580.0

37.0

55.0

43.0

Change (B – A)

23.5

(6.7)

(7.3)

(4.9)

Looking ahead, while the U.S. economy is expected to remain on the path to recovery, emerging Asian
economies such as China still appear uncertain, warranting no optimism over the business environment of the
MGC Group.
In fiscal 2017, the MGC Group anticipates a drop in operating income compared with the fiscal year underreview. This is primarily because polyacetal will likely have lower sales volumes, while polycarbonates are
expected to suffer a decline in income ratio. Severer competition in the Electronics Chemicals business, mainlyin the USA and Taiwan, will be a further drawback. The Group is also expected to post lower equity in earnings
of affiliates than for fiscal 2016, since engineering plastics affiliates and other operations will likely suffer lower
earnings.
These performance forecasts assume exchange rates of ¥110=$1 and ¥120=€1.
(End)12