Nagase : Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2025

3. Consolidated Earnings Forecast for the Fiscal Year Ending March 31, 2025 (April 1, 2024 to March 31, 2025)

(Note) For details, please refer to 2. Quarterly Consolidated Financial Statements and Notes, (4) Notes Related to Quarterly Consolidated Financial Statements (Changes in the scope of consolidation and application of the equity method), on P.12 of this document.

(2) Application of special accounting methods to the preparation of quarterly financial statements: Yes

(Note) For details, please refer to 2. Quarterly Consolidated Financial Statements and Notes, (4) Notes Related to Quarterly Consolidated Financial Statements (Special Accounting Treatment Applied in the Preparation of Quarterly Consolidated Financial Statements), on P.12 of this document.

1. Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial statements after error corrections
1. Changes in accordance with revisions to accounting and other standards: Yes
2. Changes in items other than (i) above: No
3. Changes in accounting estimates: No
4. Restatement of prior period financial statements after error corrections: No

(Note) For details, please refer to 2. Quarterly Consolidated Financial Statements and Notes, (4) Notes Related to Quarterly Consolidated Financial Statements (Change in Accounting Policy), on P.12 of this document.

1. Number of shares issued and outstanding (common stock)
   i. Number of shares issued and outstanding as of the fiscal period end (including treasury stock)

1. Number of treasury stock as of the fiscal period end

1. Average number of shares during the period

(Note) The number of treasury shares as of the fiscal period end includes Company shares held by the Stock-Granting Trust for Directors (288,500 shares as of June 30, 2024). Treasury stock deducted from the calculation of the average number of shares during the period includes Company shares held by the Stock-Granting Trust for Directors (288,500 shares as of June 30, 2024).

• Review of the Japanese-language originals of the attached consolidated quarterly financial statements by certified public accountants or an audit firm: None
• 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.

NAGASE & CO., LTD. (8012)

Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2025

1. Segment Summary

The following describes performance by segment.

Note that as of October 1, 2023 of the previous consolidated fiscal year the categorizations for reportable segments have been partially amended. Year-on-year amounts and ratios for the cumulative first quarter of the previous consolidated fiscal year are calculated after rearranging reportable segment classifications to match those of the cumulative first quarter of the current consolidated fiscal year.

*For the details of the changes in business segmentation, please refer to (Segment Information Etc.) on P.14 of this document

As of the first quarter of the current consolidated fiscal year, we changed the method of allocating corporate expenses to more appropriately reflect the performance of reportable segments. Segment information in the table below for the first quarter of the previous consolidated fiscal year is based on the allocation method after the change.

Functional Materials

・Sales increased for coating materials mainly due to strong performance in the automobile industry ・Sales increased for raw materials for the electronics industry, including semiconductor-related products

・The digital print processing materials manufacturing business narrowed losses, mainly due to the suspension of production at the U.S. site

・Operating income increased due to an increase in gross profit

Advanced Materials & Processing

・Resin sales increased due to recovery in demand in the electrical and electronics industry, including office equipment and appliance

・Operating income increased due to an increase in gross profit

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NAGASE & CO., LTD. (8012)

Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2025

Electronics & Energy

・Sales of materials to the semiconductor industry increased due to a moderate market recovery ・Sales increased for materials for display applications due to higher demand

・Sales increased for formulated epoxy resins, mainly for server applications and mobile device applications ・Operating income increased due to an increase in gross profit

Mobility

・Sales increased for resins due to boosted global automobile production despite a decrease in production by Japanese customers in China

・Sales increased for functional materials and functional components for interior and exterior fittings and electrification ・Operating income increased due to an increase in gross profit

Life & Healthcare

・Prinova Group's profitability recovered compared to the same period last year, when the food ingredients market was declining, and sales also increased

・Domestic sales of NAGASE Viita’s cosmetics materials increased, while sales abroad decreased partly due to inventory adjustments

・Sales increased for pharmaceutical raw materials and intermediates

・Operating income decreased, despite higher gross profit, as personnel expense and other selling, general and administrative expenses increased at the Prinova Group

Others

No special matters to disclose.

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NAGASE & CO., LTD. (8012)

Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2025

1. Review of Financial Position
   a. Assets, Liabilities and Net Assets

・Current assets increased due to an increase in accounts receivable and inventories, etc.

・Non-current assets increased due to an increase in property, plant and equipment and intangible fixed assets, and the fair values of investments in securities

・Liabilities increased mainly due to an increase in accounts payable, short-term loans and long-term loans

・Net assets increased mainly due to the recording of quarterly profit attributable to owners of the parent and an increase in translation adjustments, despite decreases from purchases of treasury stock and payments of dividends

・As a result, the Company recorded a shareholders’ equity ratio of 49.0%, down 0.7 points compared to 49.7% from the end of the prior consolidated fiscal year

1. Consolidated Cash Flows

・Although the Company recorded profit before income taxes of ¥10.7 billion, net cash used in operating activities was mainly the result of a decrease in cash of ¥4.5 billion in connection with an increase in working capital and ¥4.3 billion in income taxes paid.

・Net cash used in investing activities was mainly the result of cash outlays of ¥3.6 billion for the purchase of property, plant and equipment and ¥2.7 billion for net increase of time deposits

・Net cash provided by financing activities was mainly due to ¥7.0 billion in proceeds from long-term loans and a net increase of ¥6.4 billion in short-term loans. These amounts were offset in part by cash outlays of ¥4.5 billion, ¥3.3 billion, and ¥1.9 billion due to the payments of dividends, purchases of treasury stock, and repayments of long-term loans respectively.

(3) Qualitative Information Related to Consolidated Earnings Forecasts

We made no changes to the consolidated earnings forecast for the current fiscal year (April 1, 2024 to March 31, 2025) from the figures announced on May 8, 2024.

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NAGASE & CO., LTD. (8012)

Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2025

2. Quarterly Consolidated Financial Statements and Notes

1. Quarterly Consolidated Balance Sheets

(Millions of yen)

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