Slide 1: Financial Results for FY2023
Financial Results for FY2023 February 20, 2024
Slide 2: Table of Contents
Table of Contents 1. Results for FY2023 P.2- 2. Earnings Forecast for FY2024 P.11- 3. Progress of Medium-Term P.24- Management Plan 4. Appendix P.35- 1
Slide 3: Results for FY2023
Results for FY2023 2
Slide 4: Summary of Financial Results for FY2023
Summary of Financial Results for FY2023 Business Environment Geopolitical risks heightened such as with the war in Ukraine and the outbreak of conflict in the Middle East. Europe and North America continued to implement high interest rate policies to curb inflation. The recovery in the Chinese
Slide 5: Overview of Results for FY2023
Overview of Results for FY2023 Rate of FY2022 FY2023 Change Change Net sales (Millions of yen) 160,825 159,371 (1,453) (0.9%) Operating income (Millions of yen) 14,382 12,499 (1,883) (13.1%) Operating income ratio 8.9% 7.8% (1.1P) － Ordinary profit (Millions of yen) 16,446 14,503 (1,942) (11.8%) Net
Slide 6: Analysis of Changes in Operating Income
Analysis of Changes in Operating Income (Billions of yen) 5
Slide 7: Consolidated Results (by Segment)
Consolidated Results (by Segment) (Millions of yen) Net sales FY2022 FY2023 Change Volume Unit price A B BA Commodity Chemicals 73,929 73,488 (5,287) 4,845 (440) Polymer & Oligomer 35,807 33,765 (3,609) 1,566 (2,041) Adhesive Material 11,134 12,410 487 788 1,276 Performance Chemicals 10,466 9,943 (
Slide 8: Consolidated Statement of Income
Consolidated Statement of Income (Non-operating Income/Expenses and Extraordinary Income/Losses) (Millions of yen) (Millions of yen) Non-operating Extraordinary FY2022 FY2023 Change FY2022 FY2023 Change income/expenses income/losses Interest and dividend Gain on sales of income 1,088 1,320 232 inves
Slide 9: Consolidated Balance Sheet
Consolidated Balance Sheet (Millions of yen) Dec. 31, 2022 Dec. 31, 2023 Change Dec. 31, 2022 Dec. 31, 2023 Change Current assets 138,985 134,860 (4,124) Total liabilities 54,328 59,767 5,439 Cash, deposits and Notes and accounts securities (1) 58,366 56,108 (2,258) payable 19,653 19,091 (562) Notes
Slide 10: Consolidated Cash Flow Statements
Consolidated Cash Flow Statements (Millions of yen) FY2022 FY2023 Change Cash flows from operating A 10,988 21,638 10,649 activities Cash flows from investment B (3,579) (3,528) 51 activities Free cash flow C=A+B 7,409 18,110 10,701 Cash flows from financial activities D (9,464) (15,544) (6,080) Eff
Slide 11: Overview of Consolidated Subsidiaries (Results for FY2023)
Overview of Consolidated Subsidiaries (Results for FY2023) (Millions of yen) Net income (loss) Ownership Net sales Operating income (loss) attributable to owners of Company name Segment (%) parent FY2022 FY2023 FY2022 FY2023 FY2022 FY2023 1 Toa Techno-Gas Commodity Chemicals 100 3,517 4,312 76 486 1
Slide 12: Earnings Forecast for FY2024
Earnings Forecast for FY2024 11
Slide 13: Challenges in FY2024
Challenges in FY2024 Business Environment Geopolitical risks will continue to remain high. Resource prices will go down. We expect the growth rate of the global economy to be on a par with 2023. The price setting behavior of Japanese companies will change. Inflation will become more persistent
Slide 14: Consolidated Results Forecast for FY2024
Consolidated Results Forecast for FY2024 (Millions of yen) FY2023 results FY2024 1H FY2024 2H FY2023 forecast Change (A) (forecast) (forecast) (B) (B-A) Net sales 159,371 80,300 88,000 168,300 8,929 Operating income 12,499 6,700 7,300 14,000 1,501 Operating income ratio 7.8% 8.3% 8.3% 8.3% 0.5P Non-
Slide 15: Analysis of the Forecasted Changes in Operating Income
Analysis of the Forecasted Changes in Operating Income (Billions of yen) 14
Slide 16: Consolidated Results Forecast for FY2024 (by Segment)
Consolidated Results Forecast for FY2024 (by Segment) (Millions of yen) Net sales FY2023 FY2024 Change Factors for change results forecast Commodity Chemicals 73,488 78,100 4,612 [Increase] Acrylic monomer [Increase] Acrylic polymers and acrylic Polymer & Oligomer 33,765 34,800 1,035 oligomer [Incre
Slide 17: Overview of Consolidated Subsidiaries (FY2024 Forecast)
Overview of Consolidated Subsidiaries (FY2024 Forecast) (Millions of yen) Net income (loss) Net sales Operating income (loss) attributable to owners of Ownership parent Company name Segment (%) FY2024 FY2024 FY2024 FY2023 FY2023 FY2023 forecast forecast forecast 1 Toa Techno-Gas Commodity Chemicals
Slide 18: Trends in Consolidated Results
Trends in Consolidated Results (Millions of yen) (Yen) 30,000 120.00 28,299 108.14 24,840 102.78 25,000 25,000 101.31 99.43 100.00 23,039 23,156 22,184 20,000 78.91 80.00 17,676 62.43 14,382 15,000 12,499 14,000 60.00 13,782 13,771 12,336 12,494 12,179 11,300 10,387 10,000 40.00 8,142 5,000 20.00 0
Slide 19: Reference for Consolidated Performance
Reference for Consolidated Performance (Billions of yen) FY2024 FY2019 FY2020 FY2021 FY2022 FY2023 (forecast) Capital investment (Acceptance basis) 15.8 13.6 11.9 22.8 15.4 29.9 Capital investment (Approval basis) 16.9 11.8 24.9 26.0 26.7 26.0 Depreciation and amortization 9.2 9.8 10.6 10.4 10.6 11.
Slide 20: Consolidated Performance Reference Figure Trends
Consolidated Performance Reference Figure Trends (Millions of yen) (Millions of yen) 220,000 50,000 211,509 210,237 210,000 40,000 205,969 201,764 200,000 30,000 193,764 192,885 190,000 20,000 79.8% 11,534 11,376 11,208 11,065 11,095 10,981 180,000 78.4% 10,000 77.9% 77.7% 77.7% 77.6% 170,000 0 FY20
Slide 21: EBITDA/PP&E Ratio Trends
EBITDA/PP&E Ratio Trends (Millions of yen) (Millions of yen) 125,000 50,000 115,432 100,000 96,532 40,000 90,774 78,301 78,193 74,376 28,299 75,000 30,000 24,840 25,000 23,039 23,156 22,184 50,000 20,000 35.3% 31.0% 28.3% 27.4% 26.6% 21.7% 25,000 10,000 0 0 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024
Slide 22: Shareholder Return Trends
Shareholder Return Trends (Millions of yen) (yen / %) 14,000 120 111.3 % Total return 100.5 % 12,000 ratio 95.4 % 100 10,000 6,000 80 5,999 69.7% 8,000 62.1% 58 yen 53 yen 60 3,882 4,000 4,299 Dividend 6,000 per share 38.0% 36 yen 36 yen 40 4,000 30 yen 30 yen 6,235 6,571 4,554 4,408 20 2,000 3,948
Slide 23: ESG Initiatives (Environment/Social)
ESG Initiatives Aug. 2021 Participated in the Riko Challenge (science and technology challenge) organized by the Cabinet Office, Ministry of Education, Culture, Sports, Science and Technology (MEXT), and the Japan Business Federation (Keidanren) Dec. 2021 Set a target of “2050: carbon neutrality” •
Slide 24: ESG Initiatives (Governance)
ESG Initiatives Mar. 2020 Introduced a restricted share remuneration system for directors Oct. 2021 Revised the Toagosei Group Basic Policy on Corporate Governance ・Aim for the amount recorded on the balance sheet of cross shareholdings to be about 10% of consolidated net assets ・Promote disclosures
Slide 25: Progress of Medium-Term Management Plan
Progress of Medium-Term Management Plan 24
Slide 26: Progress on the Medium-Term Management Plan (2023 to 2025)
Progress on the Medium-Term Management Plan (2023 to 2025) (1) Strengthen development capabilities for new products and novel technologies (2) Increase overseas net sales (3) Contribute to a sustainable society 25
Slide 27: Strengthen Development Capabilities: Investment
Strengthen Development Capabilities for New Products and Novel Technologies (Investment) R&D costs and number of R&D personnel (consolidated): Opened the Takaoka Creation Laboratory Open the Kawasaki Frontience R&D Center 6.4 5.0 4.7 (Billions of yen) 4.4 3.7 4.0 3.8 3.7 (number Promote R&D and earl
Slide 28: Strengthen Development Capabilities: Patent Strategy
Strengthen Development Capabilities for New Products and Novel Technologies (Patent Strategy) We will pour our efforts into making patent applications in the fields we are focusing on in our Medium-term Management Plan 2025 (mobility, electronic materials, medical care and the environment). Ratio of
Slide 29: Strengthen Development Capabilities: Pharmaceuticals and Medical Care
Strengthen Development Capabilities for New Products and Novel Technologies (Pharmaceuticals and Medical Care) We will launch new products in our new medical device business which will support us in the future. Aron Alpha Skin Protect We released a skin adhesive in November 2023. This adhesive can i
Slide 30: Increase Overseas Net Sales
Increase Overseas Net Sales We will establish bases in China (Shanghai) and Vietnam to expand sales. Toagosei (Shanghai) Management Co., Ltd.’s development center started operations in December 2023. This development center will enhance our business structure in China by strengthening our existing b
Slide 31: Contribute to a Sustainable Society
Contribute to a Sustainable Society 東亞合成グループ TOAGOSEI Group CO2 Reduction Targets CO CO 2 排出量[kt] 2 emissions [kt] 2025: 35％ reduction (compared to 2013) 500 2030: 50％ reduction (compared to 2013) 430 2050: Carbon neutral 400 324 321 300 200 100 0 2013 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45
Slide 32: 2023 Results, 2024 Forecasts and 2025 Targets
2023 Results, 2024 Forecasts and 2025 Targets FY2023 2024 2025 Results Forecasts Targets Net sales 159.3 billion yen 168.3 billion yen 183.0 billion yen Operating income 12.4 billion yen 14.0 billion yen 20.0 billion yen (Operating income ratio) [7.8%] [8.3%] [11.0%] EBITDA(Earnings before interest,
Slide 33: Growth Drivers (1) (Mobility-related)
Growth Drivers (1) (Mobility-related) Mobility-related ■ Adhesives for Automotive Batteries (Hybrid and Fuel Cell Vehicles) • Our adhesives are currently being adopted in more and more new hybrid vehicles equipped with bipolar nickel-metal hydride batteries • Our adhesives are also being used in fue
Slide 34: Growth Drivers (2) (Mobility-related)
Growth Drivers (2) (Mobility-related) Mobility-related ■ Lithium Ion Battery (LIB) Binders • LIB binders suppress the expansion of the negative electrode to lead to a longer battery life. The high ionic conductivity reduces the resistance of batteries. • We are considering investing in production fa
Slide 35: Growth Drivers (3) (Semiconductor-related)
Growth Drivers (3) (Semiconductor-related) Semiconductor-related ■ High-purity liquid hydrogen chloride ■ High-purity caustic potash ■ Acrylic polymers for high-performance chemical mechanical polishing (CMP) Applications: Cleaning and polishing etc. during semiconductor manufacturing Net Sales of H
Slide 36: Appendix
Appendix 35
Slide 37: Sub-segment Year-on-Year Comparison of Net Sales (Commodity Chemicals)
Sub-segment Year-on-Year Comparison of Net Sales (Commodity Chemicals Business) Year-on-year Comparison Commodity Chemicals FY2023 4Q FY2023 1Q to 4Q Reason for the Change Business (Accounting (Cumulative Period) Period) Sales volume decreased, but net sales Inorganic chemicals 109% 115% increased d
Slide 38: Sub-segment Year-on-Year Comparison of Net Sales (Polymer and Oligomer)
Sub-segment Year-on-Year Comparison of Net Sales (Polymer and Oligomer Business) Year-on-year Comparison Polymer and Oligomer FY2023 4Q FY2023 1Q to 4Q Reason for the Change Business (Accounting (Cumulative Period) Period) Sales volume decreased, but net sales Polymers 113% 103% were on a par with t
Slide 39: Sub-segment Year-on-Year Comparison of Net Sales (Adhesive Materials)
Sub-segment Year-on-Year Comparison of Net Sales (Adhesive Materials Business) Year-on-year Comparison Adhesive Materials FY2023 4Q FY2023 1Q to 4Q Reason for the Change Business (Accounting (Cumulative Period) Period) For consumer use: Net sales increased due to price revisions Instant glue 120% 10
Slide 40: Sub-segment Year-on-Year Comparison of Net Sales (Performance Chemicals)
Sub-segment Year-on-Year Comparison of Net Sales (Performance Chemicals Business) Year-on-year Comparison Performance Chemicals FY2023 4Q FY2023 1Q to 4Q Reason for the Change Business (Accounting (Cumulative Period) Period) Inorganic functional Net sales decreased due to a decrease 81% 90% material
Slide 41: Sub-segment Year-on-Year Comparison of Net Sales (Plastics)
Sub-segment Year-on-Year Comparison of Net Sales (Plastics Business) Year-on-year Comparison Plastics Business FY2023 4Q FY2023 1Q to 4Q Reason for the Change (Accounting (Cumulative Period) Period) Net sales decreased because of the impact of the slump in the number Piping equipment 99% 96% of proj
Slide 42: Cautionary note on earnings forecasts
The earnings forecasts include forecasts based on information available as of the date of the publication of this document. Actual results may differ to the figures contained herein due to various factors which may change in the future. This document is not intended to solicit investment. Please