長瀬産業（8012） – 〔Delayed〕Consolidated Financial Statements for the Fiscal Year Ended March 31,2022

(Note: Amounts have been rounded down to the nearest million yen.) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022 May 10, 2022 These financial statements have been prepared for reference only in accordance with accounting principles and practices generally accepted in Japan. Stock exchange listing: Tokyo (Prime Market) Yoshihisa Shimizu, Executive Officer, General Manager, Corporate Management Department +81-3-3665-3103NAGASE & CO., LTD. Code number: URL (https://www.nagase.co.jp/english/) 8012 Representative: Kenji Asakura, Representative Director and President Contact: TEL: Annual general meeting of stockholders (scheduled): June 20, 2022 Start of distribution of dividends (scheduled): June 21, 2022 Securities report filing (scheduled): June 21, 2022 Supplementary documents: Yes Investors’ meeting: Yes 1. Consolidated Results for the Fiscal Year Ended March 31, 2022(April 1, 2021 to March 31, 2022)(1) Consolidated Operating Results(% = year-on-year change)Profit attributable to owners of the parent Net sales Gross profit Operating income Ordinary income FYE March 2022 FYE March 2021 Millions of yen % 780,557 24.8 625,245 －Millions of yen % 139,494 21.7 9.2 114,600 Millions of yen % 35,263 60.9 21,916 14.3 Millions of yen % 36,497 59.7 22,854 19.8 Millions of yen 25,939 18,829 % 37.8 24.3 (Notes) 1. Comprehensive income FYE March 2022: ¥28,608 million (10.3% decrease) FYE March 2021: ¥31,887 million (790.7%) 2. At the beginning of the fiscal year ended March 2022, the Company adopted the Accounting Standard for RevenueRecognition (Accounting Standards Board of Japan (ASBJ) Statement No. 29, March 31, 2020). Results for the fiscal yearended March 2021 reflect a retroactive application of this accounting standard. As a result, net sales affected by thisretroactive application do not show the year-on-year rate of change in the fiscal year ended March 2021.FYE March 2022 FYE March 2021 Earnings per share Earnings per share (diluted) Return on equity Ordinary income/ total assets Operating income/net sales Yen213.46 151.91 Yen %7.75.9 %5.33.7 %4.53.5 (Reference) Equity in earnings of affiliates FYE March 2022: (¥1,031) million (¥327) million FYE March 2021: (2) Consolidated Financial PositionFYE March 2022 FYE March 2021 (Reference) Equity capital (3) Consolidated Cash FlowsTotal assets Net assets Net assets per share Shareholders’ equity ratio Millions of yen739,720640,587Millions of yen355,092338,431FYE March 2022: ¥344,261 million FYE March 2021: ¥329,687 million %46.551.5Yen2,868.22 2,670.09Cash flows from operating activities Cash flows from investing activities Cash flows from financing activities Cash and cash equivalents, end of the year Millions of yen(17,776) 20,391 Millions of yen(7,664)2,643 Millions of yen27,282(25,866)Millions of yen 53,33648,553FYE March 2022 FYE March 2021 2. Dividends Annual Dividends per Share Fiscal year end 3Q 2Q Annual Total dividends paid (full fiscal year) Payout ratio (consolidated) Dividends/ net assets (consolidated) 1Q FYE March 2021 FYE March 2022 FYE March 2023 (forecast) Yen (Note) A year-end dividend for FYE March 2022 includes regular dividend of ¥24 per share and special dividend of ¥6 Millions of yen 5,691 6,514 Yen 24.00 30.00 30.00 Yen 22.00 24.00 30.00 Yen 46.00 54.00 60.00 % 30.3 25.1 24.7 Yen % 1.8 1.9 per share. 3. Consolidated Earnings Forecast for the Fiscal Year Ending March 31, 2023 (April 1, 2022 to March 31, 2023) Gross profit Operating income Ordinary income (% = year-on-year change) Profit attributable to owners of the parent Earnings per share Full fiscal year Millions of yen 159,000 % Millions of yen 38,000 14.0 % Millions of yen 39,000 7.8 % Millions of yen 28,500 6.9 % 9.9 Yen 241.35 * Notes (1) Changes in major subsidiaries during the period (changes in specified subsidiaries accompanying changes in the scope of consolidation): No New: ― (Company name: ) (2) Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial Excluded: ― (Company name: ) Changes in accordance with revisions to accounting and other standards: Yes statements after error corrections i. ii. Changes in items other than (i) above: No iii. Changes in accounting estimates: No iv. Restatement of prior period financial statements after error corrections: No (Note) For details, please refer to 3. Consolidated Financial Statements and Notes (5) Notes Related to Consolidated Financial Statements (Change in Accounting Policy), on P.16 of this document. (3) Number of shares issued and outstanding (common stock) i. Number of shares issued and outstanding as of the fiscal period end (including treasury stock) March 31, 2022 120,908,285 shares March 31, 2021 124,408,285 shares ii. Number of treasury stock as of the fiscal period end March 31, 2022 881,767 shares March 31, 2021 933,995 shares iii. Average number of shares during the period March 31, 2022 121,522,286 shares March 31, 2021 123,955,784 shares * These consolidated financial statements are not subject to audit by an independent audit corporation * Cautionary Statement with Respect to Forecasts of Consolidated Business Results The earnings forecasts presented in this document are based upon currently available information and assumptions deemed rational. A variety of factors could cause actual results to differ materially from forecasts. For matters related to earnings forecasts, please refer to 1. Business Performance, (4) Future Outlook, on P.6 of this document. Attachments 1. Business Performance (1) Review of Business Performance (2) Review of Financial Position (3) Summary of Cash Flows (4) Future Outlook (5) Dividend Policy and Dividends for the Fiscal Years Ending March 2021 and 2022 2. Basic Policy on the Selection of Accounting Standards 3. Consolidated Financial Statements and Notes (1) Consolidated Balance Sheets (2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income (3) Consolidated Statements of Changes in Shareholders’ Equity (4) Consolidated Statements of Cash Flows (5) Notes Related to Consolidated Financial Statements (Assumption for Going Concern) (Change in Accounting Policy) (Additional Information) (Segment Information, etc.) (Per-Share Data) (Significant Subsequent Events) 2 2 5 5 6 7 7 8 8 10 12 14 16 16 16 16 17 23 23 – 1 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 20221. Business Performance (1) Review of Business Performance a. General Summary of Results The global economy during the consolidated fiscal year under review experienced a general recovery in activities that had been stagnant due to the spread of COVID-19, as regulations were eliminated or eased in response to the progress of a third round of vaccinations across various countries. Throughout the year, uncertainty intensified due to soaring raw materials prices, the impact of semiconductor shortages, ongoing logistics disruptions, and the escalation of the situation in Ukraine. However, it was also a year in which many felt we were entering an era of the new normal. Among the regions where the NAGASE Group operates, economic activity remained strong particularly in Greater China, which demonstrated a significant recovery. In North America, recovery in employment and expansion of personal consumption resulted in stabilized economic activity overall. In Japan, corporate earnings improved; however, measures to prevent infections had a limiting effect on personal consumption and failed to generate a significant economic recovery. In this environment, the NAGASE Group contributed to the maintenance of supply chains in related industries and experienced earnings growth. As a result of the preceding, earnings for the current consolidated fiscal year were as follows. Current Consolidated Fiscal Year (March 31, 2022) Prior Consolidated Fiscal Year (March 31, 2021) Change (%) Change (Millions of yen) 625,245 114,600 21,916 22,854 29,272 18,829 780,557 139,494 35,263 36,497 39,557 25,939 155,312 24,894 13,346 13,643 10,284 7,109 24.8 21.7 60.9 59.7 35.1 37.8 * At the beginning of the current consolidated fiscal year, the Company adopted the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020). Indicators for the previous fiscal year reflect a retroactive application ・ For performance in the current fiscal year, higher profit in all segments resulted in all stages of profit below gross profit ・ Factors behind the higher profits were the recovery of the automobile-related business, which was greatly affected by COVID-19 in the first half of the prior consolidated fiscal year, the continued strong performance of the electronics-related business and resins business from the second half of the prior consolidated fiscal year, and performance of the Prinova Group in the Life & Healthcare Segment driving up profits. For details, see b. Segment Summary. ・ Profit attributable to owners of the parent amounted to ¥25.9 billion, up ¥7.1 billion, mainly due to the impact of loss on valuation of investment securities and impairment losses, despite an increase in ordinary income of ¥13.6 billion. Net sales Gross profit Operating income Ordinary income Profit before income taxes Profit attributable to owners of the parent of this accounting standard. reaching record highs. – 2 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022Net sales Gross profit Operating income b. Segment Summary The following describes performance by segment. Note that from the beginning of the current consolidated fiscal year, the names and categorizations for reportable segments have been partially amended. Year-on-year amounts and ratios for the previous fiscal year are calculated after rearranging reportable segment classifications to match those of the current fiscal year. Functional Materials Prior Consolidated Fiscal Year Current Consolidated Fiscal Year (March 31, 2021) (March 31, 2022) (Millions of yen) Change Change (%) 75,294 15,562 4,712 99,874 19,819 7,823 24,580 4,256 3,111 32.6 27.4 66.0 The major factors behind performance were as follows. ・ Raw materials sales recovered for coating and urethane raw materials as well as those related to processing industrial oil solutions and plastic materials, driven by a recovery in automobile production ・ Sales trended strong in areas like electronics chemicals for the electronics industry, such as for semiconductor-related products ・ Operating income increased due to an increase in gross profit Advanced Materials & Processing Prior Consolidated Fiscal Year Current Consolidated Fiscal Year (March 31, 2021) (March 31, 2022) (Millions of yen) Change Change (%) 209,715 26,816 7,311 257,283 32,313 10,858 47,568 5,497 3,546 22.7 20.5 48.5 Net sales Gross profit Operating income The major factors behind performance were as follows. ・ Sales increased for resins in the office equipment, appliance, and video game device markets due to increased demand, and profitability improved due to soaring market conditions ・ Sales increased for resins for industrial and packaging applications, as well as dyes and additives, due to recovery in demand ・ Sales decreased for digital print processing materials and conductive materials ・ Operating income increased due to an increase in gross profit – 3 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022 Electronics & Energy Net sales Gross profit Operating income Prior Consolidated Fiscal Year Current Consolidated Fiscal Year (March 31, 2021) (March 31, 2022) (Millions of yen) Change Change (%) 110,770 25,581 8,408 128,131 29,767 10,278 17,360 4,185 1,870 15.7 16.4 22.2 The major factors behind performance were as follows. ・ Sales increased for display materials and related to precision processing materials for semiconductors ・ Sales related to formulated epoxy resins increased, primarily for mobile devices and semiconductors ・ Sales related to photolithography materials increased with increased demand for displays ・ Operating income increased due to an increase in gross profit Mobility Net sales Gross profit Operating income Prior Consolidated Fiscal Year Current Consolidated Fiscal Year (March 31, 2021) (March 31, 2022) (Millions of yen) Change Change (%) 78,783 8,983 1,851 103,389 12,718 4,131 24,605 3,734 2,280 31.2 41.6 123.2 The major factors behind performance were as follows. ・ Sales increased for resins domestically and overseas, primarily in ASEAN, due to recovery in automobile production, and profitability increased owing to rising market conditions ・ Sales increased in functional materials and functional components for interior and exterior fittings and electrification ・ Operating income increased due to an increase in gross profit Life & Healthcare Prior Consolidated Fiscal Year Current Consolidated Fiscal Year (March 31, 2021) (March 31, 2022) (Millions of yen) Change Change (%) 150,331 37,471 6,512 191,634 44,757 9,429 41,303 7,285 2,916 27.5 19.4 44.8 Net sales Gross profit Operating income The major factors behind performance were as follows. ・ Materials sales, manufacturing, and processing all trended strongly in the nutrition-related business ・ Sales increased related to food materials, primarily TREHA™, and in cosmetics materials, primarily AA2G™, owing to recovery in demand ・ Sales increased for pharmaceutical raw materials and intermediates ・ Operating income increased due to an increase in gross profit Others No special matters to disclose. – 4 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022(2) Review of Financial Position Current assets Non-current assets Total assets Liabilities Net assets Shareholders’ equity ratio (%) Prior Consolidated Fiscal Year (March 31, 2021) Current Consolidated Fiscal Year (March 31, 2022) (Millions of yen) Change Change (%) 401,751 238,835 640,587 302,155 338,431 51.5 514,286 225,434 739,720 384,628 355,092 46.5 112,534 (13,401) 99,133 82,472 16,661 (5.0) p 28.0 (5.6) 15.5 27.3 4.9 － ・ Current assets increased mainly due to an increase in inventories and accounts receivable ・ Non-current assets decreased due to a decline in fair values and sales of investments in securities ・ Liabilities increased mainly due to an increase in accounts payable and short-term loans ・ Net assets increased due to the recording of profit attributable to owners of the parent and an increase in translation adjustments, despite a decrease in net unrealized holding gain on securities. ・ As a result, the Company recorded a shareholders’ equity ratio of 46.5%, down 5.0 points compared to 51.5% from the end of the prior consolidated fiscal year (3) Summary of Cash Flows (Millions of yen) (17,776) (7,664) 27,282 Prior Consolidated Fiscal Year Current Consolidated Fiscal Year (March 31, 2021) (March 31, 2022) Cash flows from operating activities Cash flows from investing activities Cash flows from financing activities 20,391 2,643 (25,866) ・ Net cash used in operating activities was mainly due to a ¥63.1 billion decrease in cash stemming from an increase in working capital, offset in part by ¥ 39.5 billion in income before income taxes ・ Net cash used in investing activities was mainly due to ¥8.8 billion in purchases of property, plant and equipment and ¥3.8 billion in purchases of shares of subsidiaries resulting in change in scope of consolidation, offset in part by ¥7.7 billion in proceeds from sales of investments in securities ・ Net cash provided by financing activities was mainly due to a net increase of ¥33.3 billion in short-term loans and a net increase of ¥17.0 billion in commercial paper, offset in part by ¥12.0 billion in repayments of long-term loans and ¥6.0 billion in purchases of treasury stock – 5 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022FYE March FYE March FYE March FYE March FYE March 2018 2019 2020 2021 2022 Shareholders’ equity ratio 53.3％ 54.2％ 49.9％ 51.5％ 46.5％ Shareholders’ equity ratio based on market value Interest-bearing debt to cash flow ratio (years) 39.7％ 34.7％ 25.9％ 33.3％ 29.5％ 4.1 4.9 4.1 5.8 Interest coverage ratio (times) 16.3 10.4 23.9 19.1 – – Shareholders’ equity ratio: Equity capital/total assets Shareholders’ equity ratio based on market value: Market capitalization/total assets Interest-bearing debt to cash flow ratio: Interest-bearing debt/operating cash flow Interest coverage ratio: Operating cash flow/interest payments (Note) 1. Indicators are calculated based on consolidated figures. 2. Market capitalization is calculated using the closing price at the end of the year multiplied by the number of outstanding shares at the end of the year (less treasury stock at cost). 3. Operating cash flow is net cash provided by operating activities as shown in the consolidated statements of cash flows. Interest-bearing debt is all liabilities in the consolidated balance sheets for which interest is payable. Interest payments are the amount of interest paid as presented in the consolidated statements of cash flows. 4. Interest-bearing debt to cash flow ratio or interest coverage ratio are not presented for the fiscal year ended March 31, 2022, as operating cash flow was negative. (4) Future Outlook a. Performance Forecast for the Fiscal Year Ending March 2023 We project that the environment surrounding the NAGASE Group in the next fiscal year will see limited restrictions on economic activities due to COVID-19 and that economic activities will advance under an assumption of the new normal. Although the situation in Ukraine does not have a significant impact on our business, since we have few direct transactions with either Russia or Ukraine, we expect indirect impact in the form of fluctuations in the market for raw materials due to the rise of crude oil prices and an increase in logistics costs due to the sharp rise in ocean freight rates. Accordingly, we must steer our business with greater consideration for geopolitical risks than ever before. In addition, there are concerns that sharp fluctuations in exchange rates and interest rates, as well as global inflation, will affect consumer spending and corporate earnings. profit increase. In this environment, we expect many of the business fields related to our group to continue to perform well, and we have formulated the following assumptions for the next fiscal year. In the food-related business, which we identified as a focus business under the ACE 2.0 Medium-term Management Plan, we expect Prinova Group sales to increase due to expanding consumer activity and rising health consciousness in Europe and the Americas. In addition, we expect the supply of high-end models for electronic devices in the semiconductor-related products business to recover and remain strong. With respect to our automobile-related business, which we identify as a base business, the impact of ongoing shortages of general-purpose semiconductors on production volume is an issue. However, we expect soaring resin market prices continuing from the previous fiscal year to contribute to steady sales. As we advance various measures, including investments in research and development and investments related to DX, we will engage in company-wide business replacements and reallocations of resources, improving profitability and efficiency to secure a certain level of These forecasts have been developed based on foreign exchange rates of ¥120 to the U.S. dollar and ¥18.5 to the RMB. – 6 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022Further, these forecasts were calculated based on information available at the time and on reasonable determinations of conditions. Actual results may vary significantly due to a variety of factors, including business conditions overseas and in Japan and exchange rate trends. Any issues that require disclosure in the future will be disclosed promptly if important developments relating to our forecasts for the fiscal year ending March 2023 occur. Gross profit Operating income Ordinary income (Millions of yen) Profit attributable to owners of the parent FYE March 2023 Forecast FYE March 2022 Actual Change 159,000 139,494 ＋14.0％ 38,000 35,263 ＋7.8％ 39,000 36,497 ＋6.9％ 28,500 25,939 ＋9.9％ b. Operating Income Forecast by Segment FYE March 2022 FYE March 2023 Actual Forecast Functional Materials Advanced Materials & Processing Electronics & Energy Mobility Life & Healthcare Others Total Operating Income 7,823 10,858 10,278 4,131 9,429 (7,258) 35,263 (Millions of yen) Change ＋6.1％ ＋7.8％ ＋11.9％ ＋6.5％ ＋18.8％ – ＋7.8％ 8,300 11,700 11,500 4,400 11,200 (9,100) 38,000 (5) Dividend Policy and Dividends for the Fiscal Years Ending March 2021 and 2022 Dividends are paid based on consolidated cash flows and investment conditions. Our basic policy is to pay continuously increasing dividends in consideration of consolidated earnings and financial structure, while improving profitability and strengthening our corporate structure. In addition, we will consider the flexible implementation of share buybacks with an eye toward efficiency. Based on this policy, the NAGASE Group declared a year-end dividend of ¥30 per share, which includes special dividend of ¥6 per share considering the current fiscal year’s consolidated performance and financial position. As a result, the scheduled full-year cash dividend including the interim dividend will amount to ¥54 per share, an increase of ¥8 per share from the prior fiscal year. dividend. After a comprehensive consideration of our forecast earnings capacity (our present consolidated earnings forecasts adjusted for special circumstances) and of our stability and continuity of dividend payments, we forecast a full-year dividend of ¥60 per share for the next fiscal year. This dividend will consist of a ¥30 per share interim dividend and a ¥30 per share year-end 2. Basic Policy on the Selection of Accounting Standards The NAGASE Group intends to use Japanese accounting standards for the time being to allow for inter-company comparability. We have been studying the adoption of International Financial Reporting Standards (IFRS) for some time, and we plan to make the appropriate policy choice in the future, considering external trends and other factors. – 7 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 20223. Consolidated Financial Statements and Notes (1) Consolidated Balance Sheets (Millions of yen)Prior Consolidated Fiscal Year (March 31, 2021) Current Consolidated Fiscal Year (March 31, 2022) ASSETS Current assets Cash and time deposits Notes and accounts receivable Merchandise and finished goods Work in process Raw materials and supplies Other Less allowance for doubtful accounts Total current assets Non-current assets Property, plant and equipment Buildings and structures Accumulated depreciation Buildings and structures (net) Machinery, equipment and vehicles Accumulated depreciation Machinery, equipment and vehicles (net) Land Other Accumulated depreciation Other (net) Total property, plant and equipment Intangible fixed assets Goodwill Technology-based assets Other Total intangible fixed assets Investments and other assets Investments in securities Long-term loans receivable Retirement benefit asset Deferred tax assets Other Less allowance for doubtful accounts Total investments and other assets Total non-current assets Total assets 49,254 242,558 88,130 1,654 7,457 13,259 (563) 401,751 59,327 (34,422) 24,905 64,956 (47,962) 16,993 20,054 28,074 (19,131) 8,943 70,896 30,216 7,488 26,893 64,598 93,719 211 2,929 1,903 4,689 (112) 103,340 238,835 640,587 54,211 289,862 142,590 2,401 12,533 13,935 (1,248) 514,286 61,430 (36,003) 25,427 64,794 (47,271) 17,523 20,398 30,318 (21,112) 9,205 72,554 29,492 5,912 29,664 65,070 75,600 24 3,139 3,572 5,583 (112) 87,809 225,434 739,720 – 8 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022 Prior Consolidated Fiscal Year (March 31, 2021) Current Consolidated Fiscal Year (March 31, 2022) (Millions of yen)LIABILITIES Current liabilities Notes and accounts payable Short-term loans Current portion of long-term loans Commercial paper Current portion of bonds Accrued income taxes Accrued bonuses for employees Accrued bonuses for directors Other Total current liabilities Long-term liabilities Bonds Long-term loans Deferred tax liabilities Retirement benefit liability Other Total long-term liabilities Total liabilities NET ASSETS Shareholders’ equity Common stock Capital surplus Retained earnings Less treasury stock, at cost Total shareholders’ equity Accumulated other comprehensive income Net unrealized holding gain on securities Deferred gain on hedges Translation adjustments Remeasurements of defined benefit plans Total accumulated other comprehensive income Non-controlling interests Total net assets Total liabilities and net assets 119,941 33,050 12,025 8,000 – 3,565 6,042 203 23,310 206,139 30,000 34,514 16,077 13,292 2,131 96,016 302,155 9,699 10,646 265,920 (1,503) 284,763 43,576 72 1,006 268 44,924 8,743 338,431 640,587 149,036 73,121 8,752 25,000 10,000 7,100 7,648 497 26,678 307,836 20,000 28,244 12,310 13,238 2,998 76,791 384,628 9,699 10,639 280,015 (1,534) 298,820 31,732 178 13,690 (161) 45,441 10,830 355,092 739,720 – 9 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income Prior Consolidated Fiscal Year (April 1, 2020 – March 31, 2021) Current Consolidated Fiscal Year (April 1, 2021 – March 31, 2022) (Millions of yen)(Consolidated Statements of Income) Net sales Cost of sales Gross profit Selling, general and administrative expenses Selling expenses Employee salaries and allowances Provision for accrued bonuses for employees Provision for accrued bonuses for directors Depreciation and amortization other than amortization of goodwill Retirement benefit expenses Provision for retirement benefits for directors Allowance for doubtful accounts Amortization of goodwill Other Total selling, general and administrative expenses Operating income Non-operating income Interest income Dividend income Rent income Foreign exchange gains Other Total non-operating income Non-operating expenses Interest expenses Equity in losses of affiliates Other Total non-operating expenses Ordinary income Extraordinary gains Gain on sales of non-current assets Gain on receipt of donated non-current assets Gain on sales of investment securities Gain on sales of shares of subsidiaries and affiliates Gain on sales of investments in capital of subsidiaries and affiliates Subsidy income Other Total extraordinary gains Extraordinary losses Loss on sales of non-current assets Loss on disposal of non-current assets Loss on impairment of fixed assets Loss on sales of investment securities Loss on valuation of investments securities Loss on sales of shares of subsidiaries and affiliates Other Total extraordinary losses Income before income taxes Income taxes – current Income taxes – deferred Total income taxes Profit for the period Profit attributable to non-controlling interests Profit attributable to owners of the parent – 10 – 625,245 510,645 114,600 14,877 30,828 3,609 175 6,558 1,936 19 (62) 2,344 32,396 92,683 21,916 149 1,163 263 417 766 2,759 1,064 327 430 1,821 22,854 86 – 5,774 2,657 – 163 51 8,733 23 92 1,824 10 155 1 206 2,314 29,272 7,851 1,775 9,626 19,646 816 18,829 780,557 641,062 139,494 19,907 33,977 4,522 287 6,716 769 42 612 2,478 34,918 104,231 35,263 156 1,395 272 1,283 822 3,929 1,176 1,031 486 2,695 36,497 16 719 7,037 – 314 75 229 8,392 177 453 2,974 6 1,436 59 224 5,333 39,557 12,826 (141) 12,684 26,872 932 25,939 NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022(Consolidated Statements of Comprehensive Income) (Millions of yen)Prior Consolidated Fiscal Year (April 1, 2020 – March 31, 2021) Current Consolidated Fiscal Year (April 1, 2021 – March 31, 2022) Profit for the period Other comprehensive income Net unrealized holding gain (loss) on securities Deferred gain on hedges Translation adjustments Remeasurements of defined benefit plans Share of other comprehensive gain of affiliates accounted for by the equity method Total other comprehensive income Comprehensive income Comprehensive income attributable to: Shareholders of the parent Non-controlling interests 19,646 10,945 69 7 963 254 12,241 31,887 30,774 1,112 26,872 (11,844) 106 13,623 (430) 282 1,736 28,608 26,482 2,126 – 11 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022(3) Consolidated Statements of Changes in Shareholders’ Equity Prior Consolidated Fiscal Year (April 1, 2020 – March 31, 2021) Balance, beginning of period 9,699 10,646 257,067 (5,071) Common stock Capital surplus Retained earnings Less treasury stock, at cost Total shareholders’ equity Shareholders’ equity (Millions of yen) – 9,699 (0) 10,646 3,568 (1,503) 12,420 284,763 Accumulated other comprehensive income Net unrealized holding gain on securities Deferred gain on hedges Translation adjustments Remeasurements of defined benefit plans Non-controlling interests Total net assets Total accumulated other comprehensive income Balance, beginning of period 32,618 3 1,051 (694) 32,979 7,921 313,243 Changes Cash dividends Profit attributable to owners of the parent Purchase of treasury stock Disposal of treasury stock Cancellation of treasury stock Equity transactions with non-controlling interests Changes other than shareholders’ equity accounts (net) Total changes Balance, end of period Changes Cash dividends Profit attributable to owners of the parent Purchase of treasury stock Disposal of treasury stock Cancellation of treasury stock Equity transactions with non-controlling interests Changes other than shareholders’ equity accounts (net) Total changes Balance, end of period 10,957 10,957 43,576 69 69 72 0 (0) (0) – 12 – (5,456) 18,829 (4,520) 8,852 265,920 (952) 0 4,520 822 822 272,342 (5,456) 18,829 (952) 0 – (0) (5,456) 18,829 (952) 0 – (0) 12,767 25,188 (45) (45) 1,006 963 963 268 11,944 11,944 44,924 8,743 338,431 NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022Current Consolidated Fiscal Year (April 1, 2021 – March 31, 2022) Shareholders’ equity (Millions of yen) Balance, beginning of period 9,699 10,646 265,920 (1,503) 284,763 Common stock Capital surplus Retained earnings Less treasury stock, at cost Total shareholders’ equity – 9,699 (6) 10,639 14,094 280,015 (30) (1,534) 14,057 298,820 Accumulated other comprehensive income Net unrealized holding gain on securities Deferred gain on hedges Translation adjustments Remeasurements of defined benefit plans Non-controlling interests Total net assets Total accumulated other comprehensive income Balance, beginning of period 43,576 72 1,006 268 44,924 8,743 338,431 0 (0) (0) (6) (5,876) 25,939 (5,975) 7 (6,006) 0 5,975 (5,876) 25,939 (6,006) 0 – (0) (6) 7 (5,876) 25,939 (6,006) 0 – (0) (6) 7 Changes Cash dividends Profit attributable to owners of the parent Purchase of treasury stock Disposal of treasury stock Cancellation of treasury stock Equity transactions with non-controlling interests Changes in scope of consolidation Changes in scope of equity affiliates Changes other than shareholders’ equity accounts (net) Total changes Balance, end of period Changes Cash dividends Profit attributable to owners of the parent Purchase of treasury stock Disposal of treasury stock Cancellation of treasury stock Equity transactions with non-controlling interests Changes in scope of consolidation Changes in scope of equity affiliates Changes other than shareholders’ equity accounts (net) Total changes Balance, end of period (11,843) (11,843) 31,732 106 106 178 12,684 12,684 13,690 – 13 – (430) (430) (161) 516 516 2,086 2,086 2,603 16,661 45,441 10,830 355,092 NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022Prior Consolidated Fiscal Year (April 1, 2020 – March 31, 2021) (Millions of yen)Current Consolidated Fiscal Year (April 1, 2021 – March 31, 2022) 29,272 11,008 1,824 2,344 (163) 327 1,395 (1,174) (1,312) 1,064 (24) (8,419) 155 (17,641) (1,034) 8,623 2,544 28,797 1,950 (1,067) (9,288) 20,391 (8,864) 448 (704) (3,260) 6,027 (47) 57 – 8,010 319 290 163 – 202 2,643 39,557 11,216 2,974 2,478 (75) 1,031 (599) (869) (1,551) 1,176 (778) (7,285) 1,436 (34,234) (49,346) 20,465 4,859 (9,544) 1,926 (1,202) (8,956) (17,776) (8,830) 326 (1,624) (1,317) 7,736 – 890 (3,848) 587 (83) (137) 75 (1,352) (86) (7,664) (4) Consolidated Statements of Cash Flows Operating Activities Income before income taxes Depreciation and amortization other than amortization of goodwill Loss on impairment of fixed assets Amortization of goodwill Subsidy income Share of loss of entities accounted for using equity method Increase (decrease) in retirement benefit liability Increase in retirement benefit asset Interest and dividend income Interest expenses Exchange gain, net Gain on sales of investment securities, investments in capital, shares of subsidiaries and affiliates, and investments in capital of subsidiaries and affiliates, net Loss on valuation of investment securities, investments in capital, shares of subsidiaries and affiliates, and investments in capital of subsidiaries and affiliates, net Increase in notes and accounts receivable Increase in inventories Increase in notes and accounts payable Other Subtotal Interest and dividends received Interest paid Income taxes paid Net cash provided by (used in) operating activities Purchases of property, plant and equipment Proceeds from sales of property, plant and equipment Purchases of intangible fixed assets included in other assets Purchases of investments in securities Proceeds from sales of investments in securities Purchases of investments in capital Proceeds from sales of investments in capital Purchases of shares of subsidiaries resulting in change in scope of consolidation Proceeds from sales of shares of subsidiaries resulting in change of scope of consolidation Decrease (increase) in short-term loans receivable included in other current assets, net Decrease (increase) in time deposits, net Proceeds from subsidy income Payments of leasehold and guarantee deposits Other Net cash provided by (used in) investing activities Investing activities – 14 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022 Financing activities Increase in short-term loans, net (Decrease) increase in commercial paper, net Proceeds from long-term loans Repayments of long-term loans Purchase of treasury stock Cash dividends paid Cash dividends paid to non-controlling interests Other Net cash (used in) provided by financing activities Effects of exchange rate changes on cash and cash equivalents Net (decrease) increase in cash and cash equivalents Cash and cash equivalents at beginning of the year Cash and cash equivalents, at end of the period (Millions of yen) Prior Consolidated Fiscal Year (April 1, 2020 – March 31, 2021) Current Consolidated Fiscal Year (April 1, 2021 – March 31, 2022) 658 (22,000) 4,350 (1,891) (952) (5,456) (290) (285) (25,866) 913 (1,918) 50,471 48,553 33,325 17,000 1,900 (12,039) (6,006) (5,876) (543) (477) 27,282 2,942 4,783 48,553 53,336 – 15 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022(5) Notes Related to Consolidated Financial Statements (Assumption for Going Concern) No matters to report. (Change in Accounting Policy) (Application of Accounting Standards for Revenue Recognition) At the beginning of the current consolidated fiscal year, the Company adopted the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020). As a result, revenue is now recognized as the amount expected to be received in exchange for promised goods or services at the time of the transfer of their control to the customer. As a result, in transactions for which the Company’s performance obligations in its contracts with customers are determined to be services as an agent arranging provision of goods or services by another party, the sales to customers previously recorded on a gross basis shall be offset by the corresponding cost of sales, and revenue shall be stated on a net basis. Since these changes in accounting methods shall be applied retroactively as a rule, consolidated financial statements for the same period in the prior fiscal year and for the end of the prior fiscal year shall be presented with retroactive application. As a result, net sales and cost of sales each were reduced by ¥204,995 million in the previous consolidated fiscal year and ¥244,835 million in the current consolidated fiscal year. Note that this change has no impact on any stage of profits below gross profit for either of the aforementioned periods, nor on the amount of net assets. (Application of Accounting Standard for Fair Value Measurement) As of the beginning of the current consolidated fiscal year, the Company has applied the Accounting Standard for Fair Value Measurement (ASBJ Statement No. 30, July 4, 2019). In accordance with the transitional treatment prescribed in Paragraph 19 of the Accounting Standard for Fair Value Measurement and Paragraph 44-2 of Accounting Standard for Financial Instruments (ASBJ Statement No. 10, July 4, 2019), new accounting policies prescribed by the Accounting Standard for Fair Value Measurement have been adopted prospectively. There is no effect by this change on the consolidated financial statements. (Additional Information) (Accounting Treatment of Income Taxes and Local Corporation Taxes and Tax Effect Accounting for Same) The Company and certain consolidated subsidiaries had adopted the consolidated taxation system. However, the Company and these subsidiaries submitted a notification indicating the intent to cease the application of the group tax sharing system during the current consolidated fiscal year, thereby transitioning to the non-consolidated taxation system beginning with the next consolidated fiscal year. In conjunction with this transition, the accounting treatment and presentation of tax effect accounting related to income taxes and local corporation taxes now reflects the adoption of the non-consolidated taxation system beginning with the next consolidated fiscal year, based on Practical Solution on the Accounting and Disclosure Under the Japanese Group Relief System (ASBJ PITF No. 42, August 12, 2021). The accounting treatment and disclosure of income taxes and local corporation taxes are based on the consolidated taxation treatment for the current consolidated fiscal year. Therefore, the Company follows Practical Solution on Tentative Treatment of Tax Effect Accounting Under Consolidated Taxation System (Part 1) (ASBJ PITF No.5, February 16, 2018) and Practical Solution on Tentative Treatment of Tax Effect Accounting Under Consolidated Taxation System (Part 2) (ASBJ PITF No.7, February 16, 2018). – 16 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022 (Segment Information, etc.) a. Segment Information 1. Reportable Segments (Change in Business Segments) From the beginning of the current consolidated fiscal year, the Electronics Segment has been renamed to the Electronics & Energy Segment, and the Mobility & Energy Segment has been renamed to the Mobility Segment, with changes to business segmentation as follows. For the purpose of promoting development of new businesses, the Energy Business Office previously classified under the Mobility & Energy Segment, as well as the Advanced Information and Communications Project Team previously classified under the Others/Corporate category, have been unified in the newly established Information and Communication・Energy Office, classified under the Electronics & Energy Segment. In addition, for the purpose of expanding market share and improving synergies, the fluorine business in the Specialty Chemicals Division, which was previously classified under the Functional Materials Segment, has been moved to the Electronics & Energy Segment. Segment information provided for the previous consolidated fiscal year is based on post-change classification methods. The following describes the major products and services handled by each reportable segment. The Functional Materials segment is engaged in the sales of materials for paints/inks, and adhesives, urethane materials and auxiliary materials, plastic materials, plastic additives, industrial oil solutions, water processing raw materials, surfactant raw materials, fluorochemicals, encapsulant materials, 5G materials, silicone materials, environmental solutions and environment-related commercial products, sintered metal filters, and more for the paints/inks, resins, urethane foam, organic synthesis, surfactants, electronics chemicals, communications equipment, water processing, metal processing, plastic and film processing, and other industries. The Advanced Materials & Processing Segment is engaged in the sales of dyestuffs, pigments, functional pigments, digital print processing products, thermoplastic resins, thermosetting resins, automobile refinish paints, conductive coatings, synthetic rubber, inorganic materials, plastics products, resin molding tools/dies, and more for the dye/additive, digital print processing material, fiber processing, raw resin material, resin molding, functional film and sheet, appliance and office automation device, electronics, packaging material, construction material, and other industries. The Electronics & Energy Segment is engaged in the sales of formulated epoxy resins, fluorine products, precision abrasives, semiconductor assembly materials and devices, adhesives and encapsulant materials, display panel components and devices, chemical management equipment for display manufacturing processes, low-temperature/vacuum equipment, liquid state analysis equipment, LEDs, 3D printing products, design and manufacture of storage battery systems, solar panels, optical wireless communication equipment, and other products for the semiconductor, electronic component, AR/VR, environmental energy, 3D printing, heavy electrical and light electrical, HDD, automotive and aircraft, display, touch panel, housing, lighting, storage battery, energy, renewable energy, security device, large-scale commercial facility, and other industries. Its main services include energy management system proposals, battery assessments, and health care services. The Mobility Segment is engaged in the sales of plastic products in general, materials for secondary batteries, interior and exterior materials and components, materials for functional components, products for electrification, sensor components, in-vehicle electronics products, in-vehicle display-related components, self-driving-related products, and other products for the overall mobility industry and related industries. The Life & Healthcare segment is engaged in the sale of pharmaceutical/agricultural chemicals and materials, research products, in vitro diagnostics, enzymes, food additives, food ingredients, sports nutrition products, nutrient premixes, additives for cosmetics, feeds, surfactants, and medical appliances for the pharmaceutical, food and beverage, cosmetics, agricultural, toiletries, and health care industries. The segment offers radiation measurement as one of its main services. In addition, this segment sells cosmetics, health foods, and beauty foods directly to consumers. (Application of Accounting Standards for Revenue Recognition) As described in (Change in Accounting Policy), at the beginning of the current consolidated fiscal year, the Company adopted the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020), changing its accounting method for revenue recognition. As a result, measurement methods have similarly been changed for business segment profit and loss. Segment information provided for the previous consolidated fiscal year is based on the changed profit or loss measurement method. – 17 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 20222. Net Sales, Income (Loss), Assets, Liabilities, and Other Items by Segment Accounting treatment in each reportable segment follows the principles and procedures of the accounting treatments used to prepare the Company’s consolidated financial statements. Income in reportable segments is defined as operating income. Intersegment sales/transfers are based on actual market 3. Information Related to Net Sales, Income (Loss), Assets, Liabilities, and Other Items by Segment Prior Consolidated Fiscal Year (April 1, 2020 to March 31, 2021) Reportable Segments Functional Materials Advanced Materials & Processing Electronics & Energy Mobility Life & Healthcare Total (Millions of yen)Others (Note) 1 Total Corporate (Note) 2 Adjustments (Note) 3 Consolidated (Note) 4 75,294 209,715 110,770 78,783 150,331 624,895 349 625,245 – 625,245 680 1,546 1,951 2,069 328 6,577 5,059 11,636 (11,636) Total 75,974 211,262 112,722 80,853 150,659 631,472 5,408 636,881 (11,636) 625,245 4,712 7,311 8,408 1,851 6,512 28,795 157 28,952 (7,479) 443 21,916 Segment assets 79,048 144,135 69,326 53,659 165,934 512,104 2,738 514,843 160,510 (34,766) 640,587 472 1,040 1,496 280 5,788 9,077 104 9,181 1,827 11,008 105 89 40 2,108 2,344 – 2,344 2,344 – – – 1,787 720 451 27,257 30,216 – 30,216 – 30,216 1,981 1,728 3,170 1,237 2,995 11,113 82 11,196 (1) 11,195 399 1,974 1,222 242 5,744 9,583 11 9,595 1,160 – 10,755 0 – 0 – – – (Note) 1. “Others” is a business segment consisting of businesses not included in Reportable Segments, and includes logistics services, information processing services, and professional services. 2. Corporate segment income (loss) represents expenses not allocated to Reportable Segments or Others. Segment assets under Corporate are assets not allocable to Reportable Segments or Others. 3. Adjustments are eliminations of intersegment transactions. 4. The sum of Segment income (loss) Total, Corporate, and Adjustments is equivalent to operating profit as presented in “Consolidated”. prices. Net sales Sales to customers Intersegment sales/transfers Segment income (loss) Other items Depreciation and amortization Amortization of goodwill Unamortized balance of goodwill Investments in equity affiliates Increase in property, plant, and equipment and intangible fixed assets – – – 18 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022 (Millions of yen)Current Consolidated Fiscal Year (April 1, 2021 to March 31, 2022) Reportable Segments Functional Materials Advanced Materials & Processing Electronics & Energy Mobility Life & Healthcare Total Others (Note) 1 Total Corporate (Note) 2 Adjustments (Note) 3 Consolidated (Note) 4 99,874 257,283 128,131 103,389 191,634 780,313 244 780,557 － 780,557 711 777 2,319 2,389 452 6,649 4,649 11,298 (11,298) － Total 100,585 258,060 130,450 105,778 192,087 786,962 4,893 791,856 (11,298) 780,557 7,823 10,858 10,278 4,131 9,429 42,521 100 42,621 (7,690) 331 35,263 Segment assets 83,793 164,249 77,163 68,492 218,060 611,759 2,838 614,598 190,048 (64,926) 739,720 － － － 465 1,447 1,479 342 5,959 9,694 16 9,711 1,505 － 11,216 111 178 42 － 2,145 2,478 － 2,478 － － 2,478 1,853 － 452 － 27,186 29,492 － 29,492 － － 29,492 1,300 1,828 2,761 1,403 3,139 10,432 95 10,528 0 (0) 10,528 562 1,742 1,610 558 2,435 6,909 25 6,934 3,791 － 10,725 Net sales Sales to customers Intersegment sales/transfers Segment income (loss) Other items Depreciation and amortization Amortization of goodwill Unamortized balance of goodwill Investments in equity affiliates Increase in property, plant, and equipment and intangible fixed assets (Note) 1. “Others” is a business segment consisting of businesses not included in Reportable Segments, and includes information processing services, and professional services. 2. Corporate segment income (loss) represents expenses not allocated to Reportable Segments or Others. Segment assets under Corporate are assets not allocable to Reportable Segments or Others. 3. Adjustments are eliminations of intersegment transactions. 4.The sum of Segment income (loss) Total, Corporate, and Adjustments is equivalent to operating profit as presented in “Consolidated”. – 19 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022 b. Other Information Prior Consolidated Fiscal Year (April 1, 2020 to March 31, 2021) 1. Products and Services Omitted, as the same information has been disclosed under Segment Information. 2. Geographical Information (1) Net sales (Millions of yen) Reportable Segments Functional Materials Advanced Materials & Processing Electronics & Energy Mobility Life & Healthcare Others (Note) 3 Total Composition (%) Japan 31,951 60,837 51,014 24,258 53,326 349 221,737 Greater China 9,741 93,581 40,298 25,771 2,677 2,887 19,132 45,756 7,158 20,692 12,331 1,600 537 3,760 4,622 1,156 4,834 2,870 4,595 6,877 58,401 1,043 32,722 139 316 – – – – – 172,071 95,626 86,204 42,859 6,745 75,294 209,715 110,770 78,783 150,331 349 625,245 ASEAN Americas Europe Other Revenues from contracts with customers Net sales to customers 75,294 209,715 110,770 78,783 150,331 349 625,245 (Note) 1. Net sales are categorized by country or region, according to the location of the customer. 35.5 27.5 15.3 13.8 6.9 1.0 100.0 100.0 2. Major countries and regions in each category other than Japan (1) Greater China…… China, Hong Kong, Taiwan (2) ASEAN…………… Thailand, Vietnam, Singapore (3) Americas…………. U.S., Mexico (4) Europe…………….. U.K., Germany (5) Other………………. Korea 3.“Others” is a business segment consisting of businesses not included in Reportable Segments, and includes logistics service, information processing services, and professional services. (2) Property, plant and equipment Japan Other Total 61,846 9,050 70,896 (Millions of yen)3. Major Customers Information not presented here, since no single customer accounts for 10% or more of consolidated net sales. – 20 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022 Current Consolidated Fiscal Year (April 1, 2021 to March 31, 2022) 1. Products and Services Omitted, as the same information has been disclosed under Segment Information. 2. Geographical Information (1) Net sales Japan Greater China ASEAN Americas Europe Other Revenues from contracts with customers Net sales to customers (Millions of yen) Reportable Segments Functional Materials Advanced Materials & Processing Electronics & Energy Mobility Life & Healthcare Others (Note) 3 Total Composition (%) 40,971 69,123 50,640 31,555 57,825 244 250,360 11,987 117,092 54,354 30,534 26,580 58,949 7,267 29,416 3,594 3,493 16,703 2,634 996 6,172 4,598 1,347 5,221 10,249 79,243 4,071 6,575 1,466 47,083 167 394 – – – – – 217,562 125,707 117,589 59,855 9,481 32.1 27.9 16.1 15.1 7.7 1.1 99,874 257,283 128,131 103,389 191,634 244 780,557 100.0 99,874 257,283 128,131 103,389 191,634 244 780,557 100.0 (Note) 1. Net sales are categorized by country or region, according to the location of the customer. 2. Major countries and regions in each category other than Japan (1) Greater China…… China, Hong Kong, Taiwan (2) ASEAN…………… Thailand, Vietnam, Singapore (3) Americas…………. U.S., Mexico (4) Europe…………….. U.K., Germany (5) Other………………. Korea 3.“Others” is a business segment consisting of businesses not included in Reportable Segments, and includes information processing services, and professional service (2) Property, plant and equipment Japan Other Total 62,185 10,369 72,554 (Millions of yen)3. Major Customers Information not presented here, since no single customer accounts for 10% or more of consolidated net sales. – 21 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022 c. Impairment Losses of Non-Current Assets for Each Reportable Segment Prior Consolidated Fiscal Year (April 1, 2020 to March 31, 2021) Reportable Segments Functional Materials Advanced Materials & Processing Electronics & Energy Mobility Life & Healthcare Total (Millions of yen)Others Corporate/ Elimination Total – 843 973 – – 1,817 – 7 1,824 (Note) The Advanced Materials & Processing segment recorded impairment losses of ¥843 million for business assets related to color former manufacturing business due to declining profitability. The Company wrote down the book value of these assets to their Impairment loss recoverable amounts. We conducted a review of the future business plans for the business assets owned by a Taiwanese subsidiary in the polyimide film and glass lamination business in the Electronics segment. As a result, we determined future cash flow will be less than book value. Therefore, the Company wrote down the book value of these assets to their recoverable amounts and recorded an impairment loss of ¥951 million. Current Consolidated Fiscal Year (April 1, 2021 to March 31, 2022) Reportable Segments Functional Materials Advanced Materials & Processing Electronics & Energy Mobility Life & Healthcare Total (Millions of yen)Others Corporate/ Elimination Total Impairment – 2,974 – – – 2,974 – – 2,974 loss (Note) The Company no longer expects the profitability originally anticipated for the product and manufacturing process development business related to resins in the Advanced Materials & Processing segment. Therefore, the Company has written down the book value of goodwill and other intangible fixed assets related to this business to their recoverable amounts, recording impairment losses in the amount of ¥2,911 million. d. Amortization and Unamortized Balance of Goodwill for Each Reportable Segment Prior Consolidated Fiscal Year (April 1, 2020 to March 31, 2021) Omitted, as the same information has been disclosed under Segment Information. Current Consolidated Fiscal Year (April 1, 2021 to March 31, 2022) Omitted, as the same information has been disclosed under Segment Information. e. Information About Gain on Negative Goodwill for Each Reportable Segment Prior Consolidated Fiscal Year (April 1, 2020 to March 31, 2021) No matters to report. Current Consolidated Fiscal Year (April 1, 2021 to March 31, 2022) No matters to report. – 22 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022(Note) 1. Information for diluted earnings per share is not presented, as the Company does not issue any stock with dilutive effects. 2. Basic earnings per share calculations are as shown below. Prior Consolidated Fiscal Year (April 1, 2020 – March 31, 2021) Current Consolidated Fiscal Year (April 1, 2021 – March 31, 2022) ¥2,670.09 ¥151.91 ¥2,868.22 ¥213.46 Prior Consolidated Fiscal Year Current Consolidated Fiscal Year (April 1, 2020 – March 31, 2021) (April 1, 2021 – March 31, 2022) 18,829 18,829 25,939 25,939 123,955,784 121,522,286 (Per-Share Data) Net assets per share Earnings per share Profit attributable to owners of the parent (millions of yen) Profit attributable to common stock owners of the parent (millions of yen) Average number of outstanding shares of common stock (shares) (Significant Subsequent Events) No matters to report. – 23 – NAGASE & CO., LTD. (8012) Consolidated Financial Statements for the Fiscal Year Ended March 31, 2022