Consolidated Financial Results
for the Nine Months Ended December 31, 2024
[Japanese GAAP]
February 5, 2025
Company name: ARAKAWA CHEMICAL INDUSTRIES, LTD.
Stock exchange listing: Tokyo Stock Exchange
Code number: 4968
URL: https://www.arakawachem.co.jp/en/
Representative: Nobuyuki Takagi, Representative Director and President
Contact: Toru Nobuhiro, Managing Director
Phone: +81-6-6209-8500
Scheduled date of commencing dividend payments: -
Availability of supplementary explanatory materials on financial results: Available
Schedule of financial results briefing session: Not scheduled
(Amounts of less than one million yen are rounded down.)
1. Consolidated Financial Results for the Nine Months Ended December 31, 2024 (April 1, 2024 - December 31, 2024)
(1) Consolidated Operating Results | (% indicates changes from the previous corresponding period.) | |||||||
Net sales | Operating profit | Ordinary profit | Profit attributable to | |||||
owners of parent | ||||||||
Nine months ended | Millions of yen | % | Millions of yen | % | Millions of yen | % | Millions of yen | % |
December 31, 2024 | 60,205 | 12.1 | 1,014 | - | 945 | - | 2,267 | - |
December 31, 2023 | 53,713 | (12.5) | (1,914) | - | (1,503) | - | (582) | - |
(Note) Comprehensive income: Nine months ended December 31, 2024: ¥ 785 million [(28.9)%]
Nine months ended December 31, 2023: ¥ 1,103 million [-%] | |||
Basic earnings | Diluted earnings | ||
per share | per share | ||
Nine months ended | Yen | Yen | |
December 31, 2024 | 114.32 | - | |
December 31, 2023 | (29.35) | - | |
(2) Consolidated Financial Position | |||
Total assets | Net assets | Equity ratio | |
Millions of yen | Millions of yen | % | |
As of December 31, 2024 | 125,269 | 56,751 | 45.8 |
As of March 31, 2024 | 125,418 | 56,918 | 44.8 |
(Reference) Equity: As of December 31, 2024: ¥ 57,331 million As of March 31, 2024: ¥ 56,134 million
2. Dividends
Annual dividends | ||||||||
1st quarter-end | 2nd quarter-end | 3rd quarter-end | Year-end | Total | ||||
Yen | Yen | Yen | Yen | Yen | ||||
Fiscal year ended | - | 24.00 | - | 24.00 | 48.00 | |||
March 31, 2024 | ||||||||
Fiscal year ending | - | 24.00 | - | |||||
March 31, 2025 | ||||||||
Fiscal year ending | ||||||||
March 31, 2025 | 24.00 | 48.00 | ||||||
(Forecast) | ||||||||
(Note) Revision to the forecast for dividends announced most recently: None |
3. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2025 (April 1, 2024 - March 31, 2025)
(% indicates changes from the previous corresponding period.)
Net sales | Operating profit | Ordinary profit | Profit attributable | Basic earnings | |||||
to owners of parent | per share | ||||||||
Millions of yen | % | Millions of yen | % | Millions of yen | % | Millions of yen | % | Yen | |
Full year | 82,000 | 13.5 | 1,500 | - | 1,200 | - | 2,100 | - | 105.85 |
(Note) Revision to the financial results forecast announced most recently: None
* Notes:
-
Significant changes in the scope of consolidation during the period under review: None
Newly included: - companies (Company name)
Excluded: - companies (Company name) - Adoption of accounting treatment specific to the preparation of quarterly consolidated financial statements:
None - Changes in accounting policies, changes in accounting estimates and retrospective restatement
- Changes in accounting policies due to the revision of accounting standards: None
- Changes in accounting policies other than 1) above: None
- Changes in accounting estimates: None
- Retrospective restatement: None
- Total number of issued shares (common shares)
- Total number of issued shares at the end of the period (including treasury shares):
December 31, 2024: | 20,652,400 shares |
March 31, 2024: | 20,652,400 shares |
2) Total number of treasury shares at the end of the period: | |
December 31, 2024: | 813,611 shares |
March 31, 2024: | 813,611 shares |
3) Average number of shares during the period: | |
Nine months ended December 31, 2024: | 19,838,789 shares |
Nine months ended December 31, 2023: | 19,838,909 shares |
- Review of the Japanese language originals of the attached quarterly consolidated financial statements by certified public accountants or an audit firm:None
- Explanation on the proper use of financial results forecast and other special notes
Forward-looking statements, including financial results forecasts, contained in this document are based on information currently available to the Company and certain assumptions deemed reasonable. Therefore, these statements do not constitute a guarantee that they will be realized. Actual results may differ materially from these statements due to various factors.
Quarterly Consolidated Financial Statements and Principal Notes
(1) Quarterly Consolidated Balance Sheets
(Millions of yen)
As of March 31, 2024 | As of December 31, 2024 |
Assets
Current assets
Cash and deposits
Notes and accounts receivable - trade
Electronically recorded monetary claims - operating
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net Machinery, equipment and vehicles, net
Land
Construction in progress
Other, net
Total property, plant and equipment
Intangible assets
Investments and other assets
11,578 | 9,900 | ||
25,683 | 28,429 | ||
2,504 | 2,664 | ||
12,423 | 11,857 | ||
1,603 | 1,327 | ||
9,267 | 9,675 | ||
1,215 | 1,476 | ||
(116) | (114) | ||
64,159 | 65,218 | ||
17,723 | 17,219 | ||
14,126 | 12,859 | ||
4,996 | 5,002 | ||
1,969 | 2,913 | ||
1,136 | 998 | ||
39,952 | 38,992 | ||
1,529 | 1,363 | ||
Investment securities | 11,200 | 11,162 | |
Retirement benefit asset | 6,087 | 6,337 | |
Deferred tax assets | 286 | 282 | |
Other | 354 | 366 | |
Allowance for doubtful accounts | (79) | (81) | |
Total investments and other assets | 17,850 | 18,065 | |
Total non-current assets | 59,332 | 58,422 | |
Deferred assets | |||
Business commencement expenses | 1,927 | 1,629 | |
Total deferred assets | 1,927 | 1,629 | |
Total assets | 125,418 | 125,269 |
(Millions of yen)
As of March 31, 2024 | As of December 31, 2024 |
Liabilities
Current liabilities
Notes and accounts payable - trade Electronically recorded obligations - operating Short-term borrowings
Current portion of bonds payable
Income taxes payable
Accrued consumption taxes
Provision for bonuses
Provision for bonuses for directors (and other officers)
Provision for repairs
Provision for loss on business liquidation
Asset retirement obligations
Notes payable - facilities
Other
Total current liabilities
Non-current liabilities
9,478 | 10,117 | ||
1,403 | 1,463 | ||
18,512 | 18,976 | ||
5,000 | - | ||
434 | 553 | ||
100 | 183 | ||
1,190 | 660 | ||
- | 20 | ||
732 | 757 | ||
110 | 72 | ||
- | 174 | ||
297 | 189 | ||
6,146 | 6,795 | ||
43,406 | 39,965 | ||
Bonds payable | 5,000 | 10,000 | |
Long-term borrowings | 13,875 | 12,201 | |
Deferred tax liabilities | 3,847 | 4,157 | |
Retirement benefit liability | 299 | 310 | |
Asset retirement obligations | 1,919 | 1,751 | |
Other | 151 | 132 | |
Total non-current liabilities | 25,093 | 28,553 | |
Total liabilities | 68,500 | 68,518 |
Net assets
Shareholders' equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income Valuation difference on available-for-sale securities
3,343 | 3,343 | ||
3,564 | 3,564 | ||
38,927 | 40,243 | ||
(1,211) | (1,211) | ||
44,623 | 45,939 | ||
5,173 | 5,216 |
Foreign currency translation adjustment | 3,530 | 3,604 | |
Remeasurements of defined benefit plans | 2,807 | 2,571 | |
Total accumulated other comprehensive income | 11,511 | 11,392 | |
Non-controlling interests | 783 | (580) | |
Total net assets | 56,918 | 56,751 | |
Total liabilities and net assets | 125,418 | 125,269 |
-
Quarterly Consolidated Statements of Income and Comprehensive Income Quarterly Consolidated Statements of Income
Nine Months Ended December 31
(Millions of yen) | |||
For the nine months ended | For the nine months ended | ||
December 31, 2023 | December 31, 2024 | ||
Net sales | 53,713 | 60,205 | |
Cost of sales | 45,048 | 47,765 | |
Gross profit | 8,664 | 12,440 | |
Selling, general and administrative expenses | 10,579 | 11,425 | |
Operating profit (loss) | (1,914) | 1,014 | |
Non-operating income | |||
Interest income | 68 | 75 | |
Dividend income | 195 | 201 | |
Rental income from real estate | 35 | 42 | |
Foreign exchange gains | 254 | 124 | |
Other | 189 | 145 | |
Total non-operating income | 743 | 589 | |
Non-operating expenses | |||
Interest expenses | 236 | 281 | |
Bond issuance costs | - | 24 | |
Amortization of business commencement expenses | 8 | 297 | |
Other | 87 | 56 | |
Total non-operating expenses | 332 | 659 | |
Ordinary profit (loss) | (1,503) | 945 | |
Extraordinary income | |||
Gain on sale of non-current assets | 5 | 984 | |
Gain on sale of investment securities | 196 | 478 | |
Compensation income | 431 | - | |
Total extraordinary income | 633 | 1,462 | |
Extraordinary losses | |||
Loss on sale and retirement of non-current assets | 343 | 72 | |
Total extraordinary losses | 343 | 72 | |
Profit (loss) before income taxes | (1,213) | 2,334 | |
Income taxes - current | 598 | 961 | |
Income taxes - deferred | (115) | 401 | |
Total income taxes | 483 | 1,362 | |
Profit (loss) | (1,697) | 971 | |
Loss attributable to non-controlling interests | (1,115) | (1,296) | |
Profit (loss) attributable to owners of parent | (582) | 2,267 |
Quarterly Consolidated Statements of Comprehensive Income
Nine Months Ended December 31
(Millions of yen) | ||||
For the nine months ended | For the nine months ended | |||
December 31, 2023 | December 31, 2024 | |||
Profit (loss) | (1,697) | 971 | ||
Other comprehensive income | ||||
Valuation difference on available-for-sale securities | 1,724 | 42 | ||
Foreign currency translation adjustment | 1,243 | 6 | ||
Remeasurements of defined benefit plans, net of tax | (167) | (235) | ||
Total other comprehensive income | 2,801 | (186) | ||
Comprehensive income | 1,103 | 785 | ||
Comprehensive income attributable to | ||||
Comprehensive income attributable to owners of parent | 2,059 | 2,149 | ||
Comprehensive income attributable to non-controlling | (955) | (1,364) | ||
interests | ||||
(3) Quarterly Consolidated Statements of Cash Flows
(Millions of yen) | |
For the nine months ended | For the nine months ended |
December 31, 2023 | December 31, 2024 |
Cash flows from operating activities
Profit (loss) before income taxes
Depreciation
Amortization of business commencement expenses
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for bonuses for directors (and other officers)
Increase (decrease) in retirement benefit liability Decrease (increase) in retirement benefit asset
Increase (decrease) in provision for loss on business liquidation
Loss (gain) on sale and retirement of non- current assets
Loss (gain) on sale of investment securities Interest and dividend income
Interest expenses
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Increase (decrease) in trade payables
Increase (decrease) in accrued consumption taxes
Other, net
Subtotal
Interest and dividends received
Interest paid
Income taxes refund (paid)
Net cash provided by (used in) operating activities
Cash flows from investing activities
(1,213) | 2,334 | ||
4,242 | 4,157 | ||
8 | 297 | ||
(3) | (2) | ||
(417) | (534) | ||
- | 20 | ||
17 | 10 | ||
(200) | (250) | ||
(680) | (40) | ||
337 | (911) | ||
(196) | (478) | ||
(263) | (277) | ||
236 | 281 | ||
(2,247) | (2,847) | ||
891 | 521 | ||
(164) | 681 | ||
246 | 207 | ||
529 | (367) | ||
1,123 | 2,802 | ||
257 | 282 | ||
(232) | (276) | ||
(591) | (784) | ||
556 | 2,023 | ||
Decrease (increase) in time deposits
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
(197) | 299 | |
(5,288) | (2,383) | |
14 | 772 |
Purchase of investment securities
Proceeds from sale of investment securities
Purchase of intangible assets
Payments for deferred assets
Decrease (increase) in investments and other assets
(32) | (47) | |
253 | 606 | |
(69) | (68) | |
(49) | - | |
0 | (9) | |
Other, net | (18) | (174) | |||
Net cash provided by (used in) investing | (5,386) | (1,005) | |||
activities | |||||
(Millions of yen) | |||||
For the nine months ended | For the nine months ended | ||||
December 31, 2023 | December 31, 2024 | ||||
Cash flows from financing activities | |||||
Net increase (decrease) in short-term | (928) | 900 | |||
borrowings | |||||
Proceeds from long-term borrowings | 11,994 | 405 | |||
Repayments of long-term borrowings | (4,735) | (2,633) | |||
Proceeds from issuance of bonds | - | 4,975 | |||
Redemption of bonds | - | (5,000) | |||
Dividends paid | (952) | (952) | |||
Other, net | (59) | (11) | |||
Net cash provided by (used in) financing | 5,319 | (2,315) | |||
activities | |||||
Effect of exchange rate change on cash and cash | 404 | (41) | |||
equivalents | |||||
Net increase (decrease) in cash and cash | 893 | (1,338) | |||
equivalents | |||||
Cash and cash equivalents at beginning of period | 9,286 | 9,164 | |||
Cash and cash equivalents at end of period | 10,180 | 7,826 | |||
(4) Notes to Quarterly Consolidated Financial Statements
(Segment information, etc.) [Segment information]
For the nine months ended December 31, 2023 (from April 1, 2023 to December 31, 2023) 1. Information on net sales and income or loss by reportable segment
(Millions of yen) | |||||||
Reportable segments | |||||||
Functional | Paper | Adhesive & | Others | ||||
Chemicals & | Fine Chemicals | Total | |||||
Coating | Biomass | Total | (Note) | ||||
Environmental | & Electronics | ||||||
Chemicals | Materials | ||||||
Business | |||||||
Net sales | |||||||
Net sales to | 11,051 | 15,562 | 18,843 | 8,196 | 53,654 | 58 | 53,713 |
external customers | |||||||
Inter-segment sales | - | - | - | - | - | 26 | 26 |
or transfers | |||||||
Total | 11,051 | 15,562 | 18,843 | 8,196 | 53,654 | 84 | 53,739 |
Segment income (loss) | 325 | 908 | (2,796) | (206) | (1,769) | 27 | (1,742) |
Note: The "Others" category comprises business segments not included in reportable segments, such as non-life insurance business and real estate management.
2. Reconciliation of total income or loss of reportable segments with the amount reported in the quarterly consolidated statements of income and main components of the difference (matters related to adjustments)
(Millions of yen) | |
Income | Amount |
Total of reportable segments | (1,769) |
Income in "Others" category | 27 |
Variance from the allocation of corporate expenses (Note 1) | 379 |
Corporate research and development expenses (Note 2) | (294) |
Non-operating income and expenses (Note 3) | (257) |
Operating loss in the quarterly consolidated statements of income | (1,914) |
Notes: 1. The variance from the allocation of corporate expenses primarily represents the difference in the estimated allocation of general and administrative expenses to reportable segments.
- Corporate research and development expenses represent new research and development costs not allocated to reportable segments, which are the source of medium- to long-term growth.
- Non-operatingincome and expenses primarily consist of items recorded as non-operating income and expenses in reportable segments.
3. Information on impairment losses on non-current assets or goodwill, etc., by reportable segment Not applicable