長瀬産業（8012） – 〔Delayed〕FYE March 2022 Financial Highlights

F Y E M a r c h 2 0 2 2Financial HighlightsDNAPXE>>>POLEVED>>>YFITNEDIN A G A S E & C O . , L T D .M a y 1 0 , 2 0 2 2Copyright © 2022 NAGASE & CO., LTD.Copyright © 2022 NAGASE & CO., LTD.Contents■ Consolidated Statements Income■ Gross Profit by Region■ Gross Profit by Business & Segment■ Operating Income by Business & SegmentP6■ Segment Operating Income Overview P7～P11■ State of Major Manufacturing Subsidiaries P12■ Consolidated Balance Sheets■ Consolidated Cash Flows ■ FYE March 2023 Earnings Projection P15～P16■ Shareholder ReturnsP3P4P5P13P14P17Copyright © 2022 NAGASE & CO., LTD.Consolidated Statements Income▶ Gross profit・ Higher profit in all segments, with all stages of profit below gross profit reaching record highs・ In particular, the automobile, resins and electronics, the Prinova Group’s nutrition-related business performed well・ Income greatly increased year-on-year with increases in gross profit; the economic impact of the COVID-19 had been significant▶ Operating incomein the previous fiscal year▶ Net incomelosses that pressured profits downward・ Significantly higher profits with strong business performance and gain on sales of cross-shareholdings, despite recording impairment21/0322/03ChangeVs.PY7,805 + 1,553125%100 millions of yenForecast（announced Feb 9） Achievement1,394+ 248122%1,380101%17.9%(0.5pt)－1,042+ 115112%1,030ーー350365250ー－－101%100%104%352+ 133161%364+ 136160%259+ 71138%6,2521,14618.3%926219228188SalesGross profitSG&A expensesOperating incomeOrdinary incomeProfit Attributable to owners of the parentUS$ Exchange rate(period average)RMB Exchange rate(period average)@ 106.1@ 112.4@ 6.3 Weak yen@111.9@ 15.7@ 17.5@ 1.8 Weak yen@17.4※ Offset to sales and cost of sales from application of revenue recognition standards: March. 2021, -¥204.9 billion; March. 2022, -¥244.8 billion※ Impact from foreign exchange: Gross profit, +¥3,200 million; Operating income, +¥900 millionCopyright © 2022 NAGASE & CO., LTD.3Gross Profit by Region▶ Higher profit both domestic and overseas▶ Domestic : In particular, the automobile-related business and electronics-related business for mobile devices/displays performed well▶ Overseas : The resins business, mainly for office equipment, appliances, and video game devices and focused on Greater China andASEAN, and the nutrition-related business in Europe and the Americas performed wellDomestic & Overseas Gross profit(100 millions of yen)Overseas gross profit By Region(100 millions of yen)1,200Total 1,146 Overseas511 Overseas gross profit ratio44.6%1,4001,0008006004002000Total 1,394 Overseas681 Overseas gross profit ratio48.8%100%90%80%70%60%50%40%30%20%10%0%7006005004003002001000Total 681 Other11 Europe84 Americas238 ASEAN127 Greater China218 Total 511 Other10 Europe64 Americas175 ASEAN94 Greater China166 Domestic634 Domestic713 21/0322/0321/0322/03※ From FYE March 2022, the usual overseas net sales per-destination region have been replaced by per-region information for gross profit, aggregated for each location of consolidated※ Domestic figures under Domestic & Overseas Gross Profit include inter-regional adjustments4Copyright © 2022 NAGASE & CO., LTD.Gross Profit by Business & Segment▶ Higher profits in all segments, with a full year gross profits reaching record high▶ Advanced Materials & Processing : Profitability improved in the resins business due to rising market conditions▶ Life & Healthcare : Profits increased due to strong performance in the Prinova Group’s nutrition-related business and strong salesof cosmetics-related materials※ Comparison information for segment values reflects impact from business segmentation changes implemented on April 1, 2021.Gross Profit By Business & Segment (100 millions of yen) Change in Gross Profit By Segment (100 millions of yen) Total 1,394 Total 1,394 1,4001,00080060040020001,200Total 1,146 Total 1,146 Manufacturing546 Manufacturing475 Trading & Other847 Trading & Other670 Life & Healthcare447 Mobility 127 Electronics & Energy297 Advanced Materials& Processing323 Functional materials198 Life & Healthcare374 Mobility 89 Electronics & Energy255 Advanced Materials& Processing268 Functional materials155 400200100021/0322/03History of Gross Profit(100 millions of yen)345341353353299308300260277By BusinessBy BusinessBy SegmentBy Segment21/0322/0321/0322/03１Q２Q３Q４Q21/03 22/03Copyright © 2022 NAGASE & CO., LTD.5Operating Income by Business & Segment▶ Operating income reached a record high with an increase in gross profit across all segments, despite a slowdown in the second half,mainly due to the normalization of profitability related to resin sales and an increase in general and administrative expenses▶ Manufacturing business operating income reached record high, mainly due to strong Prinova Group performance▶ We continue to invest for sustainable growth in the future, such as DX-related areasOperating Income by Business & Segment (100 millions of yen)Change in Operating Income By Segment (100 millions of yen) Total 352 Manufacturing114 Trading & Other237 Total 219 Manufacturing87 Trading & Other131 420350280210140700(70)Total 352 Life & Healthcare94 Mobility 41 Electronics & Energy102 Advanced Materials& Processing108 Functional materials78 Corporate&Others(72)Total 219 Life & Healthcare65 Mobility 18 Electronics & Energy84 Advanced Materials& Processing73 Functional materials47 Corporate&Others(68)10080604020021/0322/03History of Operating Income(100 millions of yen)9797523686717158By Business21/03By Business22/03By Segment21/03By Segment22/031Q２Q3Q4Q21/03 22/03Copyright © 2022 NAGASE & CO., LTD.6Functional Materials Segment Operating Income Overview▶ Raw materials sales increased for coating and urethane raw materials as well as those related to industrial oil solutions and plasticmaterials, driven by an increase in automotive production▶ Sales trended strong in areas like electronics chemicals for the electronics industry, such as for semiconductor-related products▶ Profits increased year-on-year; the economic impact of the COVID-19 had been significant in the previous fiscal year, primarily inthe automobile-related businessOperating income by business（100 millions of yen）History of operating income （100 millions of yen）75604530150Total 47Manufacturing 5Trading & Other42Total 78Manufacturing11Trading & Other672019201818131310815105021/0322/031Q２Q3Q4QCopyright © 2022 NAGASE & CO., LTD.21/03 22/037Advanced material & Processing Segment Operating Income Overview▶ Resins sales, mainly in products to the office equipment, appliance, and video game device industry, performed well due to rising ▶ Digital print processing materials sales continued to be sluggish due to impact from declining market from the second half ofmarket conditionsthe previous fiscal year▶ Profits increased significantly year-on-year thanks to strong sales in the resins business both domestically and overseas, as well as improvementin profitability from rising market conditionsOperating income by business（100 millions of yen）History of operating income （100 millions of yen）Total 108Manufacturing 03231Total 73Manufacturing 0Trading & Other72Trading & Other1071514202019241710080604020030021/0322/031Q２Q3Q4QCopyright © 2022 NAGASE & CO., LTD.21/03 22/038Eｌectronics & Energy Segment Operating Income Overview▶ Sales increased for display-related materials and precision processing-related materials for semiconductors▶ Sales of formulated epoxy resins-related products increased, primarily for mobile devices and semiconductors▶ Establishing a structure for next-generation communications-related business, aiming for medium- to long-term growth despite upfrontdevelopment costsOperating income by business（100 millions of yen）History of operating income （100 millions of yen）302925242425231616100806040200Total 84Manufacturing39Trading & Other45Total 102Manufacturing35Trading & Other672010021/0322/031Q２Q3Q4QCopyright © 2022 NAGASE & CO., LTD.21/03 22/039Mobility Segment Operating Income Overview▶ Sales increased in the resins business domestically and overseas, primarily in ASEAN▶ Sales increased in functional materials and functional components for interior and exterior fittings and electrification▶ Profits increased significantly year-on-year amid improved profitability stemming from a recovery in automotive production and risingmarket conditionsOperating income by business（１００ millions of yen）History of operating income （100 millions of yen）111010977403020100Total 18Trading & Other18Total 41Trading & Other411086420(1)(2)321/0322/031Q２Q3Q4QCopyright © 2022 NAGASE & CO., LTD.21/03 22/0310Life & Healthcare Segment Operating Income Overview▶ Materials sales, manufacturing, and processing all trended strongly in the nutrition-related business, primarily focused on the Prinova Group▶ Sales increased related to food materials, primarily TREHA™, in cosmetics materials, primarily AA2G™, and related to pharmaceutical raw▶ Profits increased significantly year-on-year ; the economic impact of the COVID-19 had been significant in the previous fiscal year, primarily inmaterials and intermediatesfood materials and cosmetics-related materialOperating income by business（100 millions of yen）History of operating income （100 millions of yen）Total 943027806040200Total 65Manufacturing46Trading & Other19Manufacturing69Trading & Other25201002322212016131321/0322/031Q２Q3Q4Q21/03 22/0311Copyright © 2022 NAGASE & CO., LTD.State of Major Manufacturing Subsidiaries▶ Nagase ChemteX Corporation : Profits increased with strong sales related to formulated epoxy resins primarily for mobile devices and▶ Hayashibara Co., Ltd. : Profits increased with demand for the TREHA ™ food material and with recovery in demand for the AA2G ™semiconductors, as well as for products like photolithography materials for displays▶ Prinova Group : Profits increased with continued strong sales of nutrition materials thanks to U.S. economic recovery as well as withcosmetics materialrecovery of manufacturing and processingNagase ChemteX CorporationHayashibara Co.,Ltd.Operating incomeSalesGross profitOperating incomeSalesGross profitGoodwill amortization etc.Operating income after amortization burdenSalesGross profitGoodwill amortization etc.Operating income after amortization burden21/0322/03ChangeVs.PY100 millions of yen30112%259803223610043301286616347192728989372651084530141,20921869204929112%8571-1110%117%107%104%100%115%342140%5522134%147%1104%21177%Prinova GroupOperating incomeCopyright © 2022 NAGASE & CO., LTD.12Consolidated Balance Sheets▶ Current assets : Accounts receivable and inventories increased due to favorable performance (working capital increased)▶ Net assets : Shareholders’ equity increased due to the recording of profits for the fiscal year, despite payments of dividends, purchasesof treasury stock, and a decline in market value of investments in securities▶ NET D/E ratio : Increased to 0.33 with increase in short-term borrowings due to demand for funds from increased working capital21/0322/03ChangeDetails100 millions of yenTotal current assets(Cash & time deposits)(Notes & accounts receivable)(Inventories)Total non-current assets(Investments in security)Total assetsCurrent Liab.(Notes & accounts payable)Non-current Liab.Total Liab.Shareholders’ equityAccum. other comprehensive incomeNon-controlling interestsTotal net assetsWorking capitalShareholders’ equity ratioNET D/E ratio4,0174922,4259722,3889376,4052,0611,1999603,0212,847449875,1425422,8981,5752,2547567,3973,0781,4907673,8462,9884541081,12550473602(134)(181)9911,016290(192)824140201663,3843,5502,19851.5%0.232,98346.5%0.33Short-term loans/CP+570,Current portion of bonds+1005Translation adjustments+126,Net unrealized holding loss on securities(118)Copyright © 2022 NAGASE & CO., LTD.13Consolidated Cash Flows▶ Operating CF : Net cash used of ¥17.7 billion as working capital increased due to strong business performance▶ Investing CF : Net cash used of ¥7.6 billion due to purchases of property, plant and equipment and the acquisition of stock of asubsidiary related to a corporate acquisition; offset in part by proceeds from sales of investments in securities▶ Financing CF : Net cash provided of ¥27.2 billion, mainly due to a net increase in short-term loans in connection with an increase inworking capital, offset in part by dividends and purchases of treasury stockOperating CFInvesting CFFree CFFinancing CFEffects of exchange rate changes on cash and cash equivalentsNet change in cash and cash equivalentsDepreciation and amortization oftangible and intangible assetsFixed asset investmentChange in working capital100 millions of yen２1/0322/0320326230(258)9(19)(177)(76)(254)27229+ 47133136(128)(169)(100)(631)Copyright © 2022 NAGASE & CO., LTD.14FYE March 2023 Earnings Projection▶ We expect the impact of COVID-19 on economic activities to be limited in response to the easing of regulations in various countries▶ We expect the impact of the Russia-Ukraine situation on soaring prices for crude oil and related chemical markets, as well as supply chaindisruptions, to continue to a certain extent▶ The outlook is uncertain due to many factors (impact of high global prices on consumer spending and corporate earnings, sharpfluctuations in interest rates and exchange rates, etc.); however, at present, we expect to see strong performance across mostbusinesses related to the NAGASE Group (expecting record high profits for a second consecutive fiscal year)22/03Actual23/03Forecast100 millions of yenChangeVs.PYGross profitSG&A expensesOperating incomeOrdinary incomeProfit attributable to owners of the parentUS$ Exchange rate(period average)RMB Exchange rate(period average)1,3941,0423523642591,5901,210380390285@ 112.4@ 120.0@ 17.5@ 18.5195167272525114%116%108%107%110%Copyright © 2022 NAGASE & CO., LTD.15FYE March 2023 Earnings Projection (By segment)▶ We expect the resins business, centered on Advanced Materials & Processing and Mobility, to experience strong performance based onour projections of increased demand and ongoing high market condition levels▶ We expect the semiconductor-related products business, centered on Functional Materials and Electronics, to experience strongperformance based on our projections of strong demand, particularly for telecommunications applications▶ We expect further growth in the nutrition-related business of the Life & Healthcare-related Prinova Group due to expanding consumption and rising health consciousness in Europe and the Americas▶ We expect cost increases in Corporate & Others due to office relocation, etc.22/03 Actual23/03 ForecastChangeVs.PY100 millions of yenFunctional MaterialsAdvanced Materials& ProcessingElectronics & EnergyMobilityLife & HealthcareCorporate & OthersTotalGross profitOperating incomeGross profitOperating incomeGross profitOperating incomeGross profitOperating incomeGross profitOperating incomeGross profitOperating incomeGross profitOperating income1987832310829710212741447941(72)1,39435222183343117325115142445571122(91)1,5903802241982712142109170(18)19527112%106%106%108%109%112%112%106%124%119%168%ー114%108%Copyright © 2022 NAGASE & CO., LTD.16Shareholder Returns▶ Annual dividend increased from the originally planned ¥48 per share to ¥54 per share in response to strong performance▶ As we expect strong earnings for FY2022, we plan to increase annual dividends per share by ¥6 to ¥60 per share (increase in dividends▶ We are proceeding as planned with the repurchase of ¥6 billion in treasury stock, as resolved in February 2022 for an expected 13th consecutive fiscal year)(purchase period : February 2022 to February 2023)Total DividendStock buy-backTotal Payout ratiomillions of yen51.0 48.3 12,520 42.4 12,085 ％50.040.06,006 5,041 30.033.7 33.0 30.5 35.6 36.0 35.2 3,557 3,811 4,064 5,269 1,107 3,557 3,811 4,064 4,162 7,186 6,643 1,956 5,456 952 20.05,023 5,230 5,456 5,691 6,514 7,044 10.039.5 6,799 1,776 15,00012,0009,0006,0003,000014/0315/0316/0317/0318/0319/0320/0321/0322/03Dividend per share¥２8¥30¥32¥33¥40¥42¥44¥46¥54¥60※ 22/03 year-end dividend to be submitted for approval to the 107th general meeting of shareholders scheduled for June 2022.0.023/03（Forecast）17Copyright © 2022 NAGASE & CO., LTD.https://www.nagase.co.jp/english/These presentation materials contain projections based on forward-looking assumptions, forecasts, and plans as of May 10, 2022. Actual earnings may differ from projections due to risks and uncertainties in the future global economy, competitive landscape, currency exchange rates, etc.Copyright © 2022 NAGASE & CO., LTD.