On July 29, 2022 Nippon Kayaku reported that (Press release, Nippon Kayaku, JUL 29, 2022, View Source [SID1234617328])

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1. Consolidated Business Results for the First Quarter of Fiscal Year Ending March 31, 2023 (April 1, 2022– June 30, 2022) (Figures shown are rounded down to the nearest million yen.)
(1) Consolidated Operating Results
(2) Consolidated Financial Position

2. Status of Dividends

3. Consolidated Business Results Forecasts for the Fiscal Year Ending March 31, 2023 (April 1, 2022– March 31, 2023)

1. Qualitative Information Concerning Results for the First Quarter
(1) Analysis of Operating Results During the first quarter of this consolidated fiscal year (April 1 to June 30, 2022), the global economy saw a return to normalcy from the COVID-19 pandemic, mainly in Europe and the U.S. However, the sense of uncertainty increased even more as a result of the zero COVID policy in China, the Russian invasion of Ukraine, and increasing global inflation caused by high fuel and raw material prices.

The Nippon Kayaku Group launched KAYAKU Vision 2025, the new mid-term business plan beginning this fiscal year, amid such conditions. We are working to implement the roadmap to the vision specified for each business while advancing initiatives to address key company-wide issues aimed at achieving the vision. As a result, net sales for the first quarter of this consolidated fiscal year totaled 48,296 million yen, an increase of 1,849 million yen (4.0%) year-on-year. Sales in the pharmaceuticals and other businesses underperformed while the functional chemicals and safety systems businesses outperformed the first quarter of the previous fiscal year. Operating income totaled 6,380 million yen, an increase of 493 million yen (8.4%) year-on-year. Ordinary income totaled 8,634 million yen, an increase of 2,285 million yen (36.0%) year-on-year.

Profit attributable to owners of parent was 5,957 million yen, an increase of 691 million yen (13.1%) year-on-year. The figures in the provisional accounting for a business combination in the second quarter of the previous consolidated fiscal year have been confirmed. The content confirmed in the provisional accounting is reflected in the figures for the first quarter of the previous consolidated fiscal yearPerformance by business segment is as described below. [Functional Chemicals Business] Sales rose to 21,117 million yen, an increase of 1,027 million yen (5.1%) year-on-year. The functional materials business as a whole outperformed the first quarter of the previous fiscal year. The outperformance resulted from strong sales of semiconductor materials such as epoxy resins, MEMS, and other resin composites.

These materials are used in high-speed (5G) communication devices and IoT, which are proliferating, and IT equipment, where demand increased due to increasingly sophisticated electronic equipment in vehicles. The color materials business as a whole outperformed the first quarter of the previous fiscal year. This outperformance resulted from strong sales of colorants for inkjet printers for consumer use, which more than compensated for the underperformance of colorants for inkjet printers in industrial applications compared to the first quarter of the previous fiscal year. The catalyst business underperformed the first quarter of the previous fiscal year despite strong orders both in Japan and exports overseas. The underperformance resulted from delays in freight reaching customer plants due to the lock-downs and logistics chaos that accompanied China’s zero COVID policy. In the Polatechno business, demand for dye-type polarizing films declined due to a shortage of semiconductors at customer plants.

This decline exceeded the strong sales of components for X-ray analysis systems and resulted in underperformance of the Polatechno business as a whole, compared with the first quarter of the previous fiscal year. Segment profit totaled 3,760 million yen, an increase of 361 million yen (10.6%) year-on-year. This increase resulted from growth in sales in the functional materials and color materials businesses.