Kureha Corporation Reports Interim Results
April – September 2015
Tokyo, Japan, November 2015 – Kureha Corporation (“Kureha”), a leading global
supplier of specialty chemicals and plastics, has reported earnings for the first half ofthe year ending March 2016 (fiscal 2015).
On a consolidated basis, sales decreased 6.2% to ¥68,863 million year-on-year (YoY)
while operating income fell 12.6% to ¥5,029 million. Recurring income decreased by
16.7% YoY to ¥5,028 million. This resulted in a 23.4% YoY decrease in net income to¥3,356 million as well as a reduction in earnings per share by 5.98 yen to 19.53 yen.
A challenging business environment affected performance. External factors include
the impact of the Japanese government’s promotion of generic drugs on thepharmaceuticals business; lower-than-expected sales of solar power equipment; slow
sales of anode materials due to the limited spread of hybrid electric vehicles; and an
unforeseen fall in market prices for agricultural produce in North America that left
farmers less inclined to buy high-performance but high-price agrichemicals.
This situation was compounded by rising depreciation costs associated with new PVDF
and PVDC plants, and non-operating factors including exchange rate adjustments.
However, Kureha also made progress on many fronts during the first-half period. The
Advanced Materials division recorded continued growth driven by strong performancein the PGA (polyglycolic acid) and PVDF (polyvinylidene fluoride) businesses, thereby
clearly establishing this division as a pillar for the Kureha Group. PGA in particular has
gained a strong reputation for its application in shale oil and gas extraction, and theintense demand is now moving Kureha to rapidly scale up operations in this area.
In addition, group-wide cost reductions continued to make significant contributions to
profits. The impact of these efforts on operating income is expected to reachapproximately ¥4 billion over the three-year period from fiscal 2013 through fiscal 2015.
Yutaka Kobayashi, President and Chief Executive Officer, said, “The first half of theyear proved very challenging, and it is unfortunately likely that we will not achieve thefiscal 2015 targets of our medium-term management plan, Grow Globally II. We must
look critically at each business area to maximize performance and resilience.”“That being said, the recovery of the Advanced Materials division and the extraordinary
demand seen in the PGA business show that we are fundamentally right in our strategy
to focus on downstream businesses with high margins. We will continue to innovate
and add value to our product offering at every level of our operations, while continuing
our successful drive to reduce costs across the group.”
Consolidated interim results
Sept. 2015
Sales
Operating income
Recurring income
Net income
Earnings per share (EPS) (¥)

68,863
5,029
5,028
3,356
19.53

(¥ million, except where stated)
Sept. 2014
Change (%)
73,449
5,756
6,039
4,382
25.51

-6.2
-12.6
-16.7
-23.4
-

Page 1 of 7

Consolidated interim results by division
Division
Advanced materials
Specialty chemicals
Specialty plastics
Construction related
Other operations

Total

Sept. 2015(¥ million, except where stated)
Sept. 2014
ChangeSales
Operating income
Sales
Operating income
Sales
Operating income
Sales
Operating income
Sales
Operating income
Cancellations

18,795113
15,094
2,417
21,976
1,677
6,327
318
6,669
421
(82)

18,168-398
17,7793,259
22,981
2,220
7,361
369
7,158
531
(226)

626
512
-2,685-842-1,004-543-1,034
-51
-488
-110
308

Sales
Operating income

68,863
5,029

73,4495,756-4,586-726

Performance by Division
Advanced Materials
Major product areas: advanced plastics (PPS, PVDF, PGA), carbon materials
In the first-half period, the Advanced Materials division saw increases in both sales andincome. Sales increased by 3% YoY to ¥18.8 billion from ¥18.2 billion. Operating
income recovered from the previous period’s loss of ¥0.4 billion to a positive ¥0.1 billion.
These results were driven by continued strong performance in the advanced plastics
business. Factors negatively affecting performance in the period include increased
depreciation costs related to a new PVDF plant in China.
In advanced plastics, favorable sales growth for PGA and PVDF
Sales of advanced plastics rose 20% to ¥11.5 billion. A key contributing factor was theextraordinarily strong demand for PGA in the shale oil and gas industry. While thenumber of shale oil wells overall decreased due to lower crude oil prices, PGA, whichhelps to reduce shale oil extraction costs as well as to increase productivity, saw
extended demand in North America and other global markets. To meet growing
demand, Kureha continued to enhance its manufacturing capacity for PGA extrusion
products, achieving a fivefold increase in capacity in the one-year period to November
2015.
PVDF for use in binders for lithium-ion batteries continued to see solid demand,
primarily for industrial and automotive applications, and sales were firm. However,operating income in the PVDF business was negatively affected by an increase indepreciation connected to the launch of operations at a subsidiary plant in China.
Carbon products on path to recovery
In carbon products, sales decreased by 8% to ¥3.0 billion due to factors including
falling demand for heat-insulating materials used in the manufacturing of solar power
equipment. Sales volumes of anode materials were at the same level as in the previous
period, a key contributing factor being that sales volumes of hybrid electric vehicles are
not rising as expected despite an increasing range of models. However, the loss
reported in same period last year diminished significantly due to production
streamlining and additional cost reductions.
Page 2 of 7

Outlook: Divisional sales for the full fiscal year are projected to be ¥43.5 billion, up
20% YoY from ¥36.2 billion in the previous period. Operating income is expected torise sharply by 378% to ¥2.1 billion.
The PGA business is expected to continue its strong growth trajectory, driven by highdemand in the shale oil and gas industry as well as an enhanced product portfolio,
including new PGA frac plugs incorporating dissolvable metal, that will be launched in
January 2016. Kureha will also continue to increase extrusion processing capacity at its
Japanese subsidiaries, with the goal of achieving a tenfold increase from the 2014 levelin fiscal 2016.
For heat-insulating materials used in the manufacturing of solar power equipment,
Kureha aims to improve profitability through price increases and continued cost
reductions.
In the PVDF business, Kureha will continue to strategically optimize production,
focusing on the production of specialty grades in Japan and semi-commodity grades in
China. The company anticipates continued strong demand for industrial applications of
PVDF for use in binders for lithium-ion batteries for the second half period, yet
depreciation costs connected to the plant in China will also increase and weigh on
overall performance.
The PPS business is expected to see steady sales, primarily for automotive
applications. Kureha is proceeding with capacity expansions, with the aim of boostingproduction by 2000 tons at the US plant and 700 tons at the Japanese plant withinfiscal 2016.

Specialty Chemicals
Major product areas – industrial chemicals, agrochemicals, pharmaceuticals
In the first-half period, the Specialty Chemicals division recorded sales of ¥15.1 billion,a decrease of 15% YoY, and operating income of ¥2.4 billion, a decline of 26%.
Agrochemicals sales and income decrease on lower US demand
A strong harvest season in North America led to an overall decline in the price ofagricultural produce and lower demand for agricultural chemicals, including thefungicide Metconazole.
Pharmaceuticals sluggish due to impact of generics
The pharmaceuticals business was negatively affected by continued government
promotion of generic drugs in the market, and recorded a continued decrease in thesales volume of Kremezin, a therapeutic agent for chronic kidney disease. This led
sales to fall slightly by 4% to ¥4.2 billion, with operating income also decreasing.
Outlook: Divisional sales for the full fiscal year are projected to decrease from ¥35.5
billion to ¥33.5 billion, down 6% YoY, while operating income will decrease by 46% to¥4.3 billion. In industrial chemicals, continued cost reductions are expected to have apositive effect on profitability. In agrochemicals, sales of fungicide Metoconazole are
expected to improve on gradual demand recovery. In pharmaceuticals, due tocontinued market influence from generic drugs, Kureha projects lower sales andincome for Kremezin, which will likely also negatively impact overall divisional
performance. To counteract this trend, Kureha continues its development of newpharmaceuticals, including the next-generation Kremezin.

Page 3 of 7

Specialty Plastics
Major product areas – food packaging materials, household products
In the first-half period, sales decreased 4% YoY to ¥22.0 billion from ¥23.0 billion,
mainly due to a slowdown in sales of automated filling and clipping machines.
Operating income was down 24% from ¥2.2 billion to ¥1.7 billion due to the aforementioned fall in sales as well as increasing depreciation costs.
Commercial-use food packaging materials affected by falling machine sales
In commercial-use food packaging materials, sales of heat-shrink barrier film continued
to be strong. However, the absence of a large shipment of Kureha Auto Packer (KAP)
automated filling and clipping machines, as was recorded in the previous period, led toan overall decrease in sales as well as operating income.
Consumer goods sales increase
In consumer goods, sales of New Krewrap household-use wrapping remained stable
while sales of Seaguar fishing lines continued on an upward trajectory. However,operating income fell due to depreciation costs related to a new PVDC facility in Japan.
Outlook: Divisional sales for the full fiscal year are expected to increase slightly from¥46.5 billion to ¥47.0 billion YoY, while operating income is projected to rise strongly by
26%, from ¥3.7 billion to ¥4.6 billion. Key factors forecast to drive this result include
stable growth for New Krewrap household-use wrapping and continued promotion of
global sales of heat-shrink barrier film.

Construction Related / Other Operations
Major product areas – construction and engineering, environmental engineering,logistics, trading related businesses
Sales and income decrease in construction-related businesses
In the first-half period, while official reconstruction projects connected to the Great East
Japan Earthquake of March 2011 continued to be firm, there was a slowdown in private
construction projects. As a result, construction-related businesses saw a decrease inboth sales and income. In engineering businesses, while plant construction decreased
leading to a fall in sales, operating income remained at the same level as in theprevious period due to successful cost reductions. As a result, construction-related
businesses as a whole saw a 14% decrease in sales YoY from ¥7.4 billion to ¥6.3
billion, and operating income fell from ¥0.4 billion to ¥0.3 billion.
Other operations see sales decrease
In the environmental business, sales of industrial waste disposal services fell on
volume decline due to incinerator renewals. Sales were also slower in thetransportation business. As a result, in other operations, sales decreased by 7% YoY to¥6.7 billion while operating income fell by 21% to ¥0.4 billion.
Outlook: Looking at the full fiscal year, construction-related businesses will be affectedby an overall reduction in construction projects, as well as rising wage and material
costs that will have an impact on profitability. Sales are projected to decrease 10% YoY
to ¥15.0 billion while operating income will fall 45% to ¥0.6 billion.
In other operations, Kureha forecasts an expansion of the micro-level PCB waste
treatment business. However, costs related to facility renewal will reduce operating
income. Sales are projected to increase 5% YoY to ¥16.0 billion, while operating
income will fall 22% to ¥1.4 billion.

Page 4 of 7

Capital Expenditure, Depreciation, R&D and Interest-bearing Debt
Consolidated interim capital expenditure, depreciation, R&D and interest-bearing debt(¥ billion)
Sept. 2015
Sept. 2014
March 2016
(forecasts)
Capital expenditure
5.3
9.2
16.0
Depreciation
4.8
3.9
10.0
R&D
2.3
2.3
5.7
Interest-bearing debt
85.8
84.5
89.7

Capital expenditure during the first-half period decreased from ¥9.2 billion to ¥5.3
billion. For the full fiscal year, Kureha expects to spend ¥16.0 billion, a slight decrease
from the ¥17.6 billion in fiscal 2014. The capital will mainly be invested in upgrading
aged facilities and equipment at the Iwaki Factory.
R&D expenditure remained unchanged at ¥2.3 billion. Kureha R&D will continue tofocus on improving existing products and processes as well as developing nextgeneration products. The allocation for the full fiscal year is projected to be ¥5.7 billion,
a slight increase over the previous year.
Interest-bearing debt increased slightly from ¥84.5 billion to ¥85.8 billion and is
projected to reach ¥89.7 billion for the full fiscal year.

Outlook for the Full Fiscal Year

Sales
Operating income
Recurring income
Net income
Earnings per share (EPS) (¥)

March 2016
(Forecasts)
155,000
13,00012,5008,000
46.55

Division
Advanced materials
Specialty chemicals
Specialty plastics
Construction related
Other operations

Total

Sales
Operating income
Sales
Operating income
Sales
Operating income
Sales
Operating income
Sales
Operating income
Cancellations
Sales
Operating income(¥ million, except where stated)
March 2015
Change (%)
150,182
14,551
15,426
9,195
53.53

3.2
-10.7
-19.0
-13.0
-13.0

(¥ million, except where stated)
March 2016
March 2015
Change(Forecasts)(%)
43,50036,187
20
2,100
438
378
33,50035,535
-6
4,300
7,941
-46
47,00046,519
1
4,600
3,660
26
15,00016,721
-10
600
1,081
-45
16,00015,218
5
1,400
1,789
-22
(0)
(360)
155,000
150,182
3.2
13,00014,551-10.7

Kureha expects the PGA and PVDF businesses to continue their strong performance inthe second half of fiscal 2015, and also forecasts an uptick for the household-use
packaging materials business. We will also continue our group-wide program of cost
reductions, which will make a positive contribution to results.
Page 5 of 7

However, results will be impacted by the absence of one-time benefits associated withnew business contracts in the pharmaceuticals business, increasing depreciation costs
related to new PVDC and PVDF plants, and the effect of non-operating factors such as
exchange rate adjustments and overall challenging business conditions. We also
forecast a one-time loss on retirement of fixed assets of 1.7 billion yen.
For this reason, while overall sales for fiscal 2015 are forecast to improve to ¥155.0
billion, up 3.2%, operating income is expected to decrease 10.7% to ¥13.0 billion YoY.
Recurring income is expected to decrease 19% to ¥12.5 billion. Net income will fall
13% to ¥8.0 billion for the full year.

*****
For further information, please contact:
KUREHA CORPORATION
Public Relations and IR Department
Tel. 03-3249-4651

Page 6 of 7

Condensed interim balance sheets
As of 30 September 2015 and 2014

AssetsCurrent assets
Cash and cash equivalents
Fixed assets
Property, plant and equipment
Intangible assets
Investments and other assets
Total assets
Liabilities and net assets
Current liabilities
Short-term borrowings
Fixed liabilities
Corporate bonds
Long-term borrowings
Total liabilities
Net assets
Shareholders’ equity
Minority interest
Total net assets
Total liabilities and net assets

Sept. 2015(¥ million)
Sept. 2014

74,432
5,588
172,961
123,054
2,413
47,493247,394

75,125
7,303
160,559
117,365
1,929
41,264
235,684

62,064
19,47362,22917,00023,246124,293

72,12523,56153,591
10,00022,968125,716

104,4222,370
123,100

98,281
2,321
109,968

247,394

235,684

Sept. 2015
68,86349,964
13,869
5,029
882
883
5,028
363
268
5,122
1,752
3,356

(¥ million)
Sept. 2014
73,44954,221
13,471
5,756
1,113
830
6,039
122
178
5,982
1,636
4,382

Condensed interim income statement
As of 30 September 2015 and 2014

Sales
Cost of goods soldSelling, general and administrative expenses
Operating income
Non-operating income
Non-operating expenses
Recurring income
Extraordinary gains
Extraordinary losses
Income before income taxes
Taxes and minority interest adjustments
Net income

Page 7 of 7

Fiscal 2015 Interim Results(Period April 1 – September 30,2015)

November 13, 2015

1

Contents
1. FY2015 Half-Year Results• FY2015 1H Highlights• Segment Performance• Key Indicators• Extraordinary Income/Losses• Balance Sheets• Cash Flow

2
3
4-7
8
9
10
11

2. FY2015 Full-Year Forecasts• FY2015 Full-Year Outlook• Segment Outlook• Key Indicators• Cash Flow

12
13
14-17
18
19

3. Consolidated Companies

20-22

2

1. FY2015 Half-Year Results(April 1 – September 30, 2015)

3

FY2015 1H Highlights

 Sales contract 6%, Operating income down 13% YOY• Volume declines in pharmaceuticals, agrochemicals, packaging machinery and construction• Increased depreciation costs associated with PVDC and PVDF facilities• Continued PGA growth in shale oil/gas markets
 Unfavorable currency impact, decreased non-operating income
FY2015 2Q

FY2014 2Q% Change

Net Sales

688.6

734.5

-6.2%

Operating income

50.3

57.6

-12.6%

Recurring income

50.3

60.4

-16.7%Net income

33.6

43.8

-23.4%

Total assets

2,474

2,357

--

Net assets

1,231

1,100

--

Earnings per share (yen)

19.53

25.51

--

Net assets per share (yen)702.20626.28--Equity ratio

48.8%

45.6%

--

Dividend per share (yen)

5.5

5.5

--

(in 100 million yen except per-share values)

4

Segment Performance
Advanced Materials
In 100 million yen
Kureha Sales

FY2015 1H

FY2014 1H% Change

Carbon products

30

32

-8%

Advanced plastics

115

96

20%

Other

1

3

-65%

Carbon products (China)

8

11

-25%

Battery materials

33

31

8%

Other

119

114

5%

-119

-105

--

Kureha Group Sales Total

188

182

3%

Kureha Group Operating Income Total

1

-4

---

Subsidiaries Sales

Consolidated adjustment

 Carbon products: Operating loss improved due to optimization despite lower sales volume
 Advanced plastics: PGA continued to perform strongly in shale oil/gas markets, more thanoffsetting lower PPS sales volume and increased depreciation cost for PVDF

5Specialty Chemicals
In 100 million yen

FY2015 1H

Kureha Sales

FY2014 1H% Change

Industrial chemicals

48

55

-11%

Agrochemicals

36

52

-30%

Pharmaceuticals

42

46

-8%

Subsidiaries Sales

39

44

-11%

Consolidated adjustment

-15

-18

---

Kureha Group Sales Total

151

178

-15%

Kureha Group Operating Income Total

24

33

-26%

 Industrial chemicals: Both organic and inorganic chemicals profits decreased on lower sales
volumes Agrochemicals: Profits slide on lower Metconazole fungicides volumes
 Pharmaceuticals: Sales volume declined in competition with generic drugs

6Specialty Plastics
In 100 million yen
Kureha Sales

FY2015 1H

FY2014 1H% Change

Packaging materials

39

55

-30%

Consumer products

91

91

0%

62

61

3%

Other

68

74

-9%

Consolidated adjustment

-40

-52

---

Kureha Group Sales Total

220

230

-4%

Kureha Group Operating Income Total

17

22

-24%

Subsidiaries Sales Packaging materials (overseas) Packaging materials: Packaging film performed firmly, but auto packing machine recordeda sharp drop in sales
 Consumer products: Profit decreased on flat Krewrap sales and increased depreciation
cost for new PVDC plant

7

Construction
In 100 million yen

FY2015 1H

Subsidiaries Sales

FY2014 1H% Change

98

120

-18%

-35

-47

---

Kureha Group Sales Total

63

74

-14%

Kureha Group Operating Income Total

3

4

-14%

Construction

Consolidated adjustment

 Post-quake reconstruction projects increased, but private construction projects declined

Other Operations
In 100 million yen
Subsidiaries
Sales

FY2015 1H

FY2014 1H% Change

Environmental engineering

44

46

-6%

Logistics, transportation

47

49

-5%

Trading

10

11

-4%

Other

8

11

-19%

-43

-45

---

Kureha Group Sales Total

67

72

-7%

Kureha Group Operating Income Total

4

5

-21%

Consolidated adjustment

 Industrial waste treatment business slowed due to facility (incinerator) maintenance8

Key Indicators( In 100 million yen)
FY2015 1H

FY2014 1H% Change

Capital expenditure

53

92

-43%

Depreciation

48

39

23%

R&D expenses

23

23

-2%

Interest-bearing debt

858

845

2%

Net interest expense

1

0

---

Exchange rate
Number of employees¥121.87/$1¥135.27/€14,140¥103.04/$1¥138.92/€1
4,159

--0%

9

Extraordinary Income/Losses
FY2015 1H

FY2014 1H

ChangeGain on sales of investment securities

3.2

0.7

2.5

Compensation income

0.4

0.4

-0.1

Gain on transfer of business

--

--

--

Others

0.1

0.1

0.0

Total

3.6

1.2

2.4

Loss on sales and retirement of noncurrent assets

2.4

1.7

0.7

Loss on valuation of investment securities

--

--

--

Others

0.3

0.1

0.2

Total

2.7

1.8

0.9

( In 100 million yen)

Extraordinary
incomeExtraordinary
losses10

Balance Sheets( In 100 million yen)

September 30
2015

March 31
2015

AssetsCash and cash equivalents
Accounts and notes receivable-trade
Inventories
Other current assets
Property, plant and equipment
Intangible assets
Investments and other assets
Total

56
288
330
70
1,231
24
475
2,474

78
290
328
64
1,232
24
481
2,497

-22
-2
3
6
-1
-0
-6
-23

Liabilities
andNet assets

Accounts and notes payable-trade
Interest-bearing debt
Reserves
Other liabilities
Capital stock
Capital surplus
Retained earnings
Treasury stock
Accumulated comprehensive income
Subscription rights to shares
Minority interests
Total

148
858
38
198
125
100
864
-44
163
0
24
2,474

138
866
35
252
125
100
842
-45
160
1
24
2,497

11
-7
3
-54
--22
0
3
-0
-0
-23

Change11

Cash Flow

FY2015 1H
Pre-depreciation profit
Increase/decrease in assets and liabilities
Cash flow from
Payments of corporation tax
operating activities
Other-net
Total
Cash flow from investing activities
Cash flow from financing activities
Effect of exchange rate changes on cash and cash equivalents
Increase/decrease in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year

99
-14
-25
-5
55
-56
-21
0
-22
78
56

FY2014 1H
99
-29
-25
-4
41
-103
51
-2
-14
87
73

12

2. FY2015 Full-Year Forecasts(April 1, 2015 – March 31, 2016)

13

FY2015 Full-Year Outlook
In 100 million yen

FY2016FY2015% Change

Net Sales

1,550

1,502

3.2%

Operating income

130

146

-10.7%

Recurring income

125

154

-19.0%Net income

8092-13.0%¥11¥12

Dividend per share (yen)Interim ¥5.5
Year-end ¥5.5

Interim ¥5.5
Year-end ¥5.5
Commemorative ¥1.0

Dividend payment ratio

23.6%

22.4%

 Marginal profitability to improve in PGA and Krewrap
 Continuing cost control and savings
 Lack of pharmaceuticals-related onetime income Depreciation costs related to new PVDC and PVDF facilities to increase No foreign exchange translation gains/losses expected Extraordinary losses around ¥1.7B including losses on fixed asset retirements

14

Segment Outlook
Advanced Materials
In 100 million yen
Kureha Sales

FY2015e

FY2014% Change

Carbon products

60

60

0%

Advanced plastics

266

202

32%

Other

4

5

-25%

Carbon products (China)

19

19

0%

Battery materials

78

61

28%

Other

288

241

19%

-280

-227

--

Kureha Group Sales Total

435

362

20%

Kureha Group Operating Income Total

21

4

378%

Subsidiaries Sales

Consolidated adjustment

 Carbon products will further improve operating loss with higher price and optimization
 Advanced plastics:- PGA is expected to turn profitable on growing demand in shale fields (as a material topromote cost and yield improvements)- PPS demand is likely to continue for automobile- PVDF profit will slide due to depreciation cost increases, despite volume
growth in LiB and other industrial markets

15

Specialty Chemicals
In 100 million yen

FY2015eKureha Sales

FY2014% Change

Industrial chemicals

98

106

-8%

Agrochemicals

107

98

10%

Pharmaceuticals

75

99

-24%

Subsidiaries Sales

90

88

3%

Consolidated adjustment

-35

-35

--

Kureha Group Sales Total

335

355

-6%

Kureha Group Operating Income Total

43

79

-46%

 Industrial chemicals will secure profit through fuels/raw materials cost management
 Agrochemicals will focus on Metconazole volume growth, responding to market demand Pharmaceuticals profit is likely to decrease reflecting the absence of onetime income as wellas advancement of competitive generics

16Specialty Plastics
In 100 million yen
Kureha Sales

FY2015e

FY2014% Change

Packaging materials

92

118

-22%

Consumer products

198

175

13%

135

124

9%

Other

150

148

1%

Consolidated adjustment

-105

-100

---

Kureha Group Sales Total

470

465

1%

Kureha Group Operating Income Total

46

37

26%

Subsidiaries Sales Packaging materials (overseas) Packaging materials will secure profit by globally expanding heat-shrink multilayer films
sales and offset volume decline in auto packing machinery In Consumer products, profit growth is aimed through continuing value promotion for
Krewrap while paying off depreciation cost increase17

Construction
In 100 million yen

FY2015e

Subsidiaries Sales

FY2014% Change

210

257

-18%

-60

-89

---

Kureha Group Sales Total

150

167

-10%

Kureha Group Operating Income Total

6

11

-45%

Construction

Consolidated adjustment

 Fewer construction projects, increased labor and materials costs

Other Operations
In 100 million yen
Subsidiaries
Sales

FY2015e

FY2014% Change

Environmental engineering

114

104

10%

Logistics, transportation

97

98

-1%

Trading

18

23

-20%

Other

16

20

-21%

-85

-92

---

Kureha Group Sales Total

160

152

5%

Kureha Group Operating Income Total

14

18

-22%

Consolidated adjustment

 Growing micro PCB treatment businesses but increased facility enhancement costs

18

Key Indicators( In 100 million yen)

FY2015e

FY2014% Change

Capital expenditure

160

176

-9%

Depreciation

100

83

21%

R&D expenses

57

50

15%

Interest-bearing debt

897

866

4%

Net interest expense

-2

-0

---

Exchange rate

(2nd half)¥120/$1¥135/€1¥109.90/$1¥138.84/€1---

Number of Employees

4,146

4,123

1%

19

Cash Flow
FY2015ePre-depreciation profit
Increase/decrease in assets and liabilities
Cash flow from
Payments of corporation tax
operating activities
Other-net
Total
Cash flow from investing activities
Cash flow from financing activities
Effect of exchange rate changes on cash and cash equivalents
Increase/decrease in cash and cash equivalents
Cash and cash equivalents at beginning of year
Increase/decrease in cash and cash equivalents resulting fromfiscal year change of subsidiaries
Increase in cash and cash equivalents from consolidated
subsidiaries’ merger with unconsolidated subsidiaries
Cash and cash equivalents at end of year

FY2014

208
-50
-28
13
143
-154
10
--1
78

219
-63
-41
11
125
-188
50
4
-8
87

--

-2

--

0

76

78

20

3. Consolidated Companies

21

Sales and Assets
FY2015 1H

FY2014 1H

ChangeNet sales Total assets Net sales Total assets Net sales Total assets
Kureha Corporation
Kureha Trading Group (2)Kureha Corporation
Kureha Trading Group (2)Kureha Extron Co.
Kureha Extech Co.

Kureha Battery Materials Japan Co. (2)Advanced
Kureha GmbH
Materials
Kureha America Group (4)Kureha Chemicals Shanghai Co.
Kureha China Group (3)Consolidation adjustments
Total
Kureha Corporation
Specialty Kureha Trading Co.
Chemicals Consolidation adjustments
Total
Kureha Corporation
Kureha Trading Co.
Kureha Gohsen Co.
Kureha China Group (3)Specialty
Kureha America Group (4)Plastics
Kureha Europe Group (4)Kureha Vietnam Co.
Consolidated adjustments
Total

402
124
146
39
12
13
33
8
23
8
25
-119
188
127
39
-15
151
130
36
19
3
11
45
17
-40
220

1,951
119
--25
30
38
11
291
37
158
--------35
--68
47
---

429
145
131
52
10
11
31
8
31
11
1
-105
182
152
44
-18
178
146
39
19
10
7
44
17
-52
230

1,845
133
--20
25
47
12
296
36
133
--------33
--67
47
---

-27
-21
15
-13
2
2
3
-0
-8
-3
23
-14
6
-25
-5
3
-27
-16
-3
-1
-7
4
1
0
12
-10

106
-14
--5
5
-9
-1
-5
1
25
--------2
--1
-0
---

22

Sales and Assets
FY2015 1H

FY2014 1H

ChangeNet sales Total assets Net sales Total assets Net sales Total assets
Kureha Nishiki Group (4)Kureha Engineering Co.
Consolidation adjustments
Total
Kureha Ecology Management Co.
Kureha Special Laboratory Co.
Kureha Unyu Group (7)Kureha Trading Co.
Other
Operations Kureha Service Co.
Kureha Staff Service Co.
Consolidation adjustments
Total[Total Number of Consolidated Subsidiaries]

80
18
-35
63
37
6
47
10
3
6
-43
67
[37]

97
28
--75
7
60
-9
6
---

94
26
-47
74
40
7
49
11
3
8
-45
72
[37]

107
29
--77
6
60
-8
6
---

-14
-8
12
-10
-2
-0
-2
-0
0
-2
2
-5

-10
-1
---2
1
0
-1
-0
--0

Consolidation Total
Equitymethod Nangtong SKT New Material Co.
affiliates

689

--

735

--

-46

--

21

--

16

--

5

--

Construction*Parenthesized numbers indicate the number of subsidiaries in the group

Disclaimer
1. These materials are supplied to provide a deeper understanding of ourcompany, and are not intended to as a solicitation for investment or otheractions
2. These materials were prepared by our company based on the information
available at this point in time, however actual performance may produce
results that differ from the plan, due to a variety of factors
3. Please utilize these materials using you own judgment and responsibility