FY2019 3Q Results

February 6, 2020

1FY2019 3Q Overview(in billions of yen)

Vs. FY2018 3Q

FY20183Q

FY20193Q

Change(%)

Revenue

110.8

105.4-5.4(-5%)

Core operating profit

13.8

13.0-0.8(-6%)

Operating profit

13.9

25.8+11.9(+85%)

Profit before income tax

14.2

25.9+11.7(+82%)

Profit attributable toowners of Kureha

11.1

20.7+9.6(+86%)• Lower revenue driven by Advanced
Materials, Specialty Chemicals andSpecialty Plastics• Lower core operating led driven by
Advanced Materials, Specialty
Chemicals and Specialty Plastics,partially offset with improved earnings inConstruction and Other Operations• A substantial increase in operating profit
resulting from other income, including
gains from land property sales (HQannex location), the transfer of the bottle
business, and a bargain purchaserelated to new consolidation• Profit for the period increased on higher
operating profit

2FY2019 3Q Overview
Performance by Segment: FY2019 3Q vs. FY2018 3Q
FY18 3Q

Revenue

FY19 3Q

34.3(in billions of yen)(Vs. FY2018 3Q)
Operating profit
5.9

35.3 34.0

31.4

3.6
20.4

17.312.9 13.2

9.5
7.8

3.3

FY18 3Q
FY19 3Q

5.7

2.7

1.5
0.3

Advanced Specialty
Materials Chemicals

Specialty Construction OtherOperations
Plastics

Advanced Specialty
Materials Chemicals

0.6

1.4

2.0

Specialty Construction OtherOperations
Plastics

Factors attributing to operating profit (vs. FY2018 3Q)
AM: Slower sales in ‘other’ product groups, partially offset by improved margins for PVDF and PGA
SC: Lower agrochemical volume
SP: Lower profit margins for packaging materials, partially offset by higher profit for home products
CO: Increased number of private construction projects
OO: Higher industrial waste treatment volume and effects of new consolidation in the environment
business

3

FY2019 3Q Overview
FY2018 3Q(in billions of yen)

FY2019 3QAMSCSPCOOO

CorporateAMSCSPCOOO

Corporate

Revenue

34.3

20.4

35.3

7.8

12.9

110.8

31.4

17.3

34.0

9.5

13.2

105.4

Segment operating profit

3.6

2.7

5.9

0.3

1.4

13.8

3.3

1.5

5.7

0.6

2.0

13.0

Adjustments

0.1

-0.0

Other income

0.3

*13.1

Other expenses

*0.3

0.3

13.9

25.8

Finance income

0.6

0.5Finance costs

0.3

0.4

Profit before income tax

14.2

25.9

Profit for the period

11.1

20.7

Operating profit* Includes a loss of ¥0.2bn on the retirement of
noncurrent assets* Includes gains of ¥10.2bn on the sale ofnoncurrent assets (3Q); ¥1.2bn on the transfer ofbusiness (3Q) and; ¥1.5bn from a bargain
purchase of business (1Q)

4Segment Performance:
Advanced Materials(billions of yen)

FY20183Q

FY20193Q

Vs. FY2018 3Q
ChangeYOY%

Advanced Materials

Advanced plastics

21.2

20.4-4%

Carbon products

4.74.4-7%

Other

8.3

6.6

-20%

Revenue

34.3

31.4-8%Operating Profit

3.6

3.3

-9%

Revenue down, Operating profit down
Advanced plastics:
Revenue decreased due to slower sales ofPPS and PGA stock shapes, partially
offset by higher sales volumes of PGA fracplugs and PVDF for LiB binder
applications. Operating profit improved onhigher profit margins generated by PVDF
and PGA
Carbon products:
Operating profit decreased on lower
revenue, despite continued full-capacity
production
Other:
Revenue and operating profit declined dueto slower demand in semiconductor andelectrics/electronics markets

5Segment Performance:
Specialty Chemicals(billions of yen)

FY20183Q

FY20193Q

Vs. FY2018 3Q
ChangeYOY%

Specialty Chemicals

Agrochemicals

6.4

3.6-44%

Pharmaceuticals

3.5

3.6+5%

Industrial chemicals

5.7

5.2-9%

Other

4.8

4.9+2%

Revenue

20.4

17.3-15%

Operating Profit

2.7

1.5-45%

Revenue down, Operating profit down
Agrochemicals:
Operating profit declined due to lower
fungicides volumes

Pharmaceuticals:
Operating profit improved on lower cost,
despite flat revenue growth
Industrial chemicals:
Operating profit decreased on slower
sales for both organic and inorganic
chemicals6Segment Performance:
Specialty Plastics(billions of yen)

FY20183Q

FY20193Q

Vs. FY2018 3Q
ChangeYOY%

Revenue down, Operating profit downHome products & fishing lines:
Higher operating profit was supported bysales volumes growth of both New
Krewrap and Seaguar fishing lines

Specialty Plastics

Home products

16.9

16.9+0%Fishing lines

2.1

2.2+8%

Packaging materials

12.1

10.9-10%

Other4.3

3.9-8%

Revenue

35.3

34.0-4%

Operating Profit

5.9

5.7-4%Packaging materials:
Operating profit decreased due to lower
ML shrink film sales volumes and theimpact of the transfer of bottle business7Segment Performance:
Construction(billions of yen)

FY20183Q

FY20193Q

Vs. FY2018 3Q
ChangeYOY%

Revenue up, Operating profit up
Construction:
Operating profit doubled as revenue
grew with a larger number ofconstruction projects in the private
sectorConstruction

Construction

13.0

15.3

+18%

Consolidation
adjustments

-5.2

-5.8

--Revenue

7.8

9.5+21%

Operating Profit

0.3

0.6+140%

8Segment Performance:
Other Operations(billions of yen)

FY20183Q
Other Operations
Environmentalengineering
Logistics

FY20193Q

Vs. FY2018 3Q
ChangeYOY%

8.6

9.0+5%

6.2

6.1-2%

Hospital operation

2.8

3.0+9%

OtherConsolidation
adjustments

1.4

1.6+15%

-6.1

-6.6

--Revenue

12.9

13.2+2%

Operating Profit

1.4

2.0+42%

Revenue up, Operating profit up
Environmental engineering
Operating profit improved due to higher
industrial waste treatment volume and theeffect of business acquisition
Logistics
Revenue and operating profit remained flat
Hospital operation
Revenue increased, while operating profitremained flat

9

Financial Position
Assets(billions of yen)

Liabilities and Equity
Mar.31
2019

Dec.31
Change2019

Mar.31
2019

Dec.31
Change2019

Cash and cash equivalents

6.0

9.7

3.8

Trade and other payables

24.0

21.1

-2.9

Trade and other receivables

30.7

29.7

-1.1

Interest-bearing debt

39.0

44.3

5.2

Inventories

38.3

43.5

5.1

Provisions

6.8

5.8

-1.0

Other current assets

3.7

5.4

1.7

Other liabilities

15.3

16.1

0.8

Total current assets

78.8

88.3

9.5

Total liabilities

85.2

87.3

2.1

Property, plant and equipment

117.6

123.2

5.6

Shareholders’ equity

18.2

18.2

--

Intangible assets

1.1

1.1

-0.0

Capital surplus

15.0

15.0

--

Investments and other assets

49.9

52.1

2.2

Less: Treasury stock

-3.7

-8.3

-4.6

Retained earnings

122.4

142.9

20.6

Other components of equity

8.7

7.8

-0.9

Non-controlling interests

1.6

1.7

0.1

Total non-current assets

168.6

176.3

7.8

Total equity

162.2

177.3

15.2

Total assets

247.4

264.6

17.3

Total liabilities and equity

247.4

264.6

17.3

Notes to the statement of financial position as of December 31, 2019 and other supplementary information• Impacts of business merger with Himeyuri Total Work: Current assets: +¥2.2bn, Property, plant and equipment: +¥5.5bn,Other non-current assets: +¥0.8bn, Interest-bearing debt: +¥4.9bn, Provision: +¥1bn• Impacts of accounting policy changes (IFR,16 ‘Lease’): Property, plant and equipment: +¥2.5bn, Interest-bearing debt: +¥2.5bn• Ratio of equity attributable to owners of Kureha to total assets: 64.9% (as of Mar. 31, 2019), 66.4% (as of Dec. 31, 2019)• Treasury stock acquired during 9 months from April 1 through December 31, 2019: 679,700 shares valued at ¥4.569 million

10FY2019 Full-Year Forecast*FY2019 earnings forecast has been unchanged since last announced on November 11, 2019(In billions of yen, except per-share values)

Vs. FY2018

FY2019FY2018ChangeFY2019
YOYGuidance
Guidance(%)(Aug. 2019)(Nov. 2019)

Revenue

148.3

144.0

-4.3
(-3%)

152.0

Core operating profit

17.4

17.0

-0.4(-2%)

17.0

Operating profit

17.2

28.5

11.3
(66%)

26.0

Profit before income tax

17.4

28.5

11.1(63%)

26.0

Profit attributable toowners of Kureha

13.9

22.0

8.1(58%)

19.5

¥70.0
¥95.0

¥85.0
¥85.0 (to be paid)

Dividend per share:
InterimYear-end• Revenue expected to decrease
mainly in Advanced Materials andSpecialty Plastics• Lower core operating profit led bySpecialty Chemicals and Specialty
Plastics, despite profit growth inAdvanced Materials (PGA togenerate profit)• Operating profit to increase due toother income resulting from landsales and a bargain businesspurchase related to newconsolidation(Vs. Previous guidance)• Lower revenue driven by Advanced
Materials and Specialty Plastics• Higher operating profit led by higher‘other income’ inclusive of gains
from bargain purchase related to a
new subsidiary and the transfer ofKureha’s bottle business11

FY2019 Full-Year Forecast*FY2019 earnings forecast has been unchanged since last announced on November 11, 2019

Performance by Segment: FY2019 guidance vs. FY2018
Revenue
45.7

43.0…FY2018…FY2019e

45.1 43.5(billions of yen)Core operating profit
6.7
4.6

3.3
17.6 17.5

2.7

2.1 2.1

12.4 13.0

Specialty
Chemicals

Other
Specialty
Construction
Operations
Plastics

FY2018: ¥148.3bn

FY2019e: ¥144.0bn

6.4

5.2

27.3 27.0

Advanced
Materials…FY2018…FY2019e

0.7 0.6
Advanced
Materials

Specialty
Chemicals

Other
Specialty
Construction
Operations
Plastics

FY2018: ¥17.4bn

FY2019e: ¥17.0bn

Factors attributing to core operating profit (vs. FY2018)
AM: PGA to generate profit, higher earnings in the PVDF business
SC: Lower agrochemical volumes due to customer’s inventory adjustments more than offsetting
profit growth in Pharmaceuticals
SP: Lower packaging materials volumes
CO: Fewer high-margin construction projects
OO: (Performs on par with FY18)

12

FY2019 Full-Year Forecast*FY2019 earnings forecast has been unchanged since last announced on November 11, 2019

FY2018(billions of yen)

FY2019 guidance

AMSCSPCOOO

CorporateAMSCSP

COOO

Corporate

Revenue

45.7

27.3

45.1

12.4

17.6

148.3

43.0

27.0

43.5

13.0

17.5

144.0

Segment operating profit

4.6

3.3

6.7

0.7

2.1

17.4

5.2

2.7

6.4

0.6

2.1

17.0

Adjustments

0.1

--

Other income*10.6

Other expenses

*20.9

1.0

17.2

28.5

Finance income

0.7

0.7

Finance costs

0.4

0.7

Profit before income tax

17.4

28.5

Profit for the period

13.9

22.0

Operating profit*1 Includes ¥0.3 billion subsidy income*2 Includes a loss of ¥0.8 billion on the retirement of noncurrent assets

*1

12.5

*1 Includes gains of ¥9.3bn on the sale of land properties(Kureha HQ annex location); ¥1.5bn on the discountpurchase of a new subsidiary; ¥1.2bn on the transfer ofKureha’s bottle business13FY2019 Full-Year Forecast
Details of Other Income and Other Expenses(billions of yen)

FY2018FY2019e

Subsidy income

0.3

Gain from land sales (Kureha
HQ annex location)

9.3

Insurance income

0.1

Gain from bargain purchaserelated to new consolidation

1.5

Other

0.2

Gain on the transfer ofKureha’s bottle business

1.2

Other

0.6

Other income total

12.5

Other income total

0.6

Loss on retirement of noncurrent assets

0.8

Loss on retirement of noncurrent assets

0.7

Other0.2

Other

0.3

Other expenses total

0.9

Other expenses total

1.0Disclaimer•These materials are supplied to provide a deeper understanding of ourcompany, and are not intended to as a solicitation for investment or otheractions.

•These materials have been prepared by our company based on theinformation available at this point in time. However, actual performance
may produce results that differ from the plan due to unforeseeable eventsand factors.

•Please utilize these materials using you own judgment and responsibility.