(English Translation)
This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between this translated document and the Japanese original, the original shall prevail.
Consolidated Financial Results for the Second Quarter of the
Fiscal Year Ending November 30, 2024 (FY11/24)
(Six Months Ended May 31, 2024)
[Japanese GAAP]
July 11, 2024
Company name: | OSAKA ORGANIC CHEMICAL INDUSTRY LTD. | ||
Listing | Tokyo Stock Exchange, Prime Market | ||
Securities code | 4187 | URL https://www.ooc.co.jp/ | |
Representative | Masayuki Ando, Representative Director and CEO | ||
Inquiries | Soichi Honda, Director, Corporate Officer, General Manager of Administration Division | ||
TEL: +81-6-6264-5071 | |||
Scheduled date of filing of Quarterly Report | : | July 11, 2024 | |
Scheduled date of dividend payment : | August 5, 2024 | ||
Preparation of supplementary materials for quarterly financial results: Yes | |||
Holding of quarterly financial results meeting | : | Yes (for institutional and individual investors, | |
and securities analysts) |
(All amounts are rounded down to the nearest million yen)
1. Consolidated Financial Results for the Second Quarter of FY11/24 (December 1, 2023 to May 31, 2024)
(1) Consolidated results of operations | (Percentages represent year-on-year changes) | |||||||
Net sales | Operating profit | Ordinary profit | Profit attributable to | |||||
owners of parent | ||||||||
Millions of yen | % | Millions of yen | % | Millions of yen | % | Millions of yen | % | |
Six months ended May 31, 2024 | 15,338 | 7.5 | 1,859 | (4.1) | 1,988 | (4.1) | 2,020 | 25.8 |
Six months ended May 31, 2023 | 14,262 | (11.7) | 1,939 | (41.6) | 2,074 | (41.2) | 1,606 | (34.4) |
NOTE: Comprehensive income (millions of yen) Six months ended May 31,2024: | 2,198 | (up 14.3) | ||||
Six months ended May 31, 2023: | 1,924 | (down 24.2) | ||||
Basic earnings per share | Diluted earnings per share | |||||
Yen | Yen | |||||
Six months ended May 31, 2024 | 95.44 | - | ||||
Six months ended May 31, 2023 | 74.75 | - | ||||
(2) Consolidated financial position | ||||||
Total assets | Net assets | Equity ratio | ||||
Millions of yen | Millions of yen | % | ||||
As of May 31, 2024 | 57,092 | 44,795 | 77.3 | |||
As of Nov. 30, 2023 | 54,636 | 43,629 | 78.7 |
Reference: Shareholders' equity (millions of yen) As of May 31, 2024: 44,131 | As of Nov. 30, 2023: 42,984 |
2. Dividends | |
Dividend per share |
1Q-end | 2Q-end | |
Yen | Yen | |
Fiscal year ending Nov. 30, 2023 | - | 28.00 |
Fiscal year ending Nov. 30, 2024 | - | 32.00 |
Fiscal year ending Nov. 30, 2024 (Forecast)
NOTE: Revisions to the most recently announced dividend forecast:
3Q-end | Year-end | Total |
Yen | Yen | Yen |
- | 28.00 | 56.00 |
- | 32.00 | 64.00 |
None |
3. Consolidated Forecasts for the FY11/24 (December 1, 2023 to November 30, 2024)
(Percentages represent year-on-year changes) | |||||||||
Net sales | Operating profit | Ordinary profit | Profit attributable to | Basic earnings | |||||
owners of parent | per share | ||||||||
Millions of yen | % | Millions of yen | % | Millions of yen | % | Millions of yen | % | Yen | |
Full year | 32,000 | 10.7 | 4,200 | 17.4 | 4,400 | 13.5 | 3,700 | 13.1 | 175.00 |
NOTE: Revisions to the most recently announced consolidated forecast: None
※ Notes | |||
(1) Changes of important subsidiaries during the period | : None | ||
(change in scope of consolidation) | |||
Newly added: | - | Excluded: | - |
(2) Application of special accounting methods for presenting quarterly consolidated financial statements : None
(3) Changes in accounting policies and accounting-based estimates, and restatements
① Changes in accounting policies due to revisions in accounting standards, others | : None |
② Changes in accounting policies other than 1) above | : None |
③ Changes in accounting-based estimates | : None |
④ Restatements | : None |
- Number of shares issued (common shares)
- Number of shares issued at the end of As of May 31, 2024: the period (including treasury shares)
- Number of treasury shares at the end As of May 31, 2024: of the period
- Average number of shares during the Six months ended
period | May 31, 2024: |
22,410,038 Shares | As of Nov. 30, 2023: | 22,410,038 Shares |
1,283,283 Shares | As of Nov. 30, 2023: | 1,142,585 Shares |
21,166,133 Shares | Six months ended | 21,489,440 Shares |
May 31, 2023: |
- The current quarterly financial report is not subject to quarterly review by certified public accountants or auditing firms.
- Cautionary statement with respect to forward-looking statements and other special items
The forward-looking statements contained in this material are based on information available to the Company's management at the time the materials were prepared and include a variety of uncertainties. Actual results may differ from the forecasts due to changes in the business environment and other factors. Please refer to "Explanation of Consolidated Forecast and Other Forward- looking Statements" on page 3 for items pertaining to the forecasts stated above.
OSAKA ORGANIC CHEMICAL INDUSTRY LTD. (4187) Financial Results for the Second Quarter of FY11/24
- Contents of Attachments
1. Qualitative Information on Quarterly Consolidated Financial Performance | 2 | |
(1) | Explanation of Results of Operations | 2 |
(2) | Explanation of Financial Position | 2 |
(3) | Explanation of Consolidated Forecast and Other Forward-looking Statements | 3 |
2. Quarterly Consolidated Financial Statements and Notes | 4 | |
(1) | Quarterly Consolidated Balance Sheet | 4 |
(2) | Quarterly Consolidated Statements of Income and Comprehensive Income | 6 |
Quarterly Consolidated Statement of Income | 6 | |
For the Six-month Period | 6 | |
Quarterly Consolidated Statement of Comprehensive Income | 7 | |
For the Six-month Period | 7 | |
(3) | Quarterly Consolidated Statement of Cash Flows | 8 |
(4) | Notes to Quarterly Consolidated Financial Statements | 10 |
Going Concern Assumption | 10 | |
Significant Changes in Shareholders' Equity | 10 | |
Segment and Other Information | 10 | |
Significant Subsequent Events | 11 |
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OSAKA ORGANIC CHEMICAL INDUSTRY LTD. (4187) Financial Results for the Second Quarter of FY11/24
1. Qualitative Information on Quarterly Consolidated Financial Performance
(1) Explanation of Results of Operations
The outlook for the Japanese economy in the second quarter of the current fiscal year remains uncertain. While the employment and income environment has improved and gradual recovery has been seen as a result of various policies, it is necessary to closely monitor downside risks caused by overseas economies, such as global monetary tightening and concerns about the outlook for the Chinese economy, the impact of yen depreciation and price rises, the situation in the Middle East and changes in financial and capital markets.
Under these circumstances, we launched a new medium-term management planning Progress & Development 2030 (P&D 2030) for the period from the fiscal year ended November 2024 to the fiscal year ended November 2030. Based on our Group management philosophy, P&D 2030 has set a management vision of "providing value to the global market as a leading company in specialty acrylic acid esters." Under this vision, we will promote sustainable management that takes ESG into account, aiming to increase corporate value and achieve sustainable growth.
In the Chemicals Business, we worked to improve profitability by integrating and closing products, and focused on expanding sales of environmentally friendly products, such as those derived from biomass. In the electronic materials business, the Group worked to accelerate the development of cutting-edge semiconductor materials and to develop new applications for photoresist materials. In the functional chemicals business, the Group worked to strengthen overseas expansion of cosmetic raw materials and expand sales of high-purity special solvents.
As a result, for the consolidated cumulative second quarter, net sales were 15,338 million yen (up 7.5% year on year), operating profit was 1,859 million yen (down 4.1% year on year), ordinary profit was 1,988 million yen (down 4.1% year on year) and profit attributable to owners of parent was 2,020 million yen (up 25.8% year on year).
Business results by segment are explained below (excluding inter-segment transactions).
- Chemical products
In the Chemicals Business, sales of acrylic acid ester group for automotive coatings decreased, but sales for display adhesives and UV inkjet inks increased significantly. Methacrylic acid esters recorded to a strong performance sales. As a result, net sales were 5,992 million yen (up 30.8% year on year) and segment profit was 849 million yen (up 166.2% year on year).
- Electronics materials
In the electronic materials business, sales of raw materials for cutting-edge EUV resists increased significantly. However, sales of raw materials for ArF resists, which are the Company's mainstay, declined despite signs of recovery from sluggish demand due to prolonged inventory adjustments. As a result, the Group-wide net sales declined. In the Display Materials Group, sales for insulating films for touch panels increased, and the Group's overall sales remained firm. As a result, net sales were 6,659 million yen (up 1.4% year on year) and segment profit was 644 million yen (down 39.3% year on year).
- Specialty chemicals
Raw materials for cosmetics recorded strong sales abroad. As for functional materials, sales of products made for other companies remained weak. Sales of high-purity specialty solvents at subsidiaries decreased. As a result, net sales were 2,686 million yen (down 13.8% year on year) and segment profit was 356 million yen (down 36.7% year on year).
(2) Explanation of Financial Position
Total assets at the end of the second quarter of the current fiscal year increased by 2,455 million yen from the end of the previous fiscal year to 57,092 million yen. This was mainly attributable to an increase of 4,104 million yen in cash and deposits, an increase of 560 million yen in notes, accounts receivable-trade and contract assets, a decrease of 266 million yen in finished goods, a decrease of 952 million yen in machinery, equipment and vehicles, a decrease of 864 million yen in other current assets due to refunds of consumption tax receivable, and a decrease of 102 million yen in investment securities.
Liabilities at the end of the second quarter of the current fiscal year increased by 1,289 million yen from the end of
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OSAKA ORGANIC CHEMICAL INDUSTRY LTD. (4187) Financial Results for the Second Quarter of FY11/24
the previous fiscal year to 12,297 million yen. This was mainly due to an increase of 802 million yen in notes and accounts payable-trade and an increase of 575 million yen in income taxes payable.
Net assets at the end of the second quarter of the current fiscal year increased by 1,166 million yen from the end of the previous fiscal year to 44,795 million yen. This was mainly due to an increase of 1,424 million yen in retained earnings, an increase of 419 million yen in treasury shares, and an increase of 89 million yen in valuation difference on available-for-sale securities.
Cash Flows
Cash and cash equivalents at the end of the second quarter of the current fiscal year increased by 4,104 million yen from the end of the previous fiscal year to 11,995 million yen.
(Cash flows from operating activities)
Net cash provided by operating activities was 5,473 million yen compared with 2,020 million yen provided in the same quarter of the previous fiscal year. This was mainly attributable to profit before income taxes of 2,802 million yen, depreciation of 1,589 million yen, increase (decrease) in consumption taxes payable/ consumption taxes refund payable of 932 million yen, and income taxes paid of 260 million yen.
(Cash flows from investing activities)
Net cash provided by investing activities was 460 million yen compared with 990 million yen used in the same quarter of the previous fiscal year. This was mainly due to purchase of property, plant and equipment of 593 million yen and proceeds from sales of investment securities of 1,054 million yen.
(Cash flows from financing activities)
Net cash used in financing activities was 1,906 million yen compared with 2,074 million yen used in the same quarter of the previous fiscal year. This was mainly due to repayments of long-term loans payable of 1,044 million yen, purchase of treasury stock of 427 million yen, and cash dividends paid of 595 million yen.
- Explanation of Consolidated Forecast and Other Forward-looking Statements The consolidated forecasts announced on June 26, 2024, remain unchanged.
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OSAKA ORGANIC CHEMICAL INDUSTRY LTD. (4187) Financial Results for the Second Quarter of FY11/24
2. Quarterly Consolidated Financial Statements and Notes
(1) Quarterly Consolidated Balance Sheet
(Thousands of yen) | ||
FY11/23 | Second quarter of FY11/24 | |
(As of Nov. 30, 2023) | (As of May 31, 2024) | |
Assets | ||
Current assets | ||
Cash and deposits | 7,890,809 | 11,995,567 |
Notes, accounts receivable-trade and contract assets | 8,634,668 | 9,195,486 |
Electronically recorded monetary claims-operating | 335,183 | 253,162 |
Finished goods | 4,558,239 | 4,291,826 |
Work in process | 1,979,792 | 2,195,294 |
Raw materials and supplies | 2,175,488 | 2,022,819 |
Other | 1,540,540 | 675,621 |
Allowance for doubtful accounts | (12,736) | (13,596) |
Total current assets | 27,101,985 | 30,616,184 |
Non-current assets | ||
Property, plant and equipment | ||
Buildings and structures, net | 8,720,743 | 8,594,694 |
Machinery, equipment and vehicles, net | 8,673,751 | 7,721,311 |
Land | 2,172,476 | 2,172,476 |
Construction in progress | 520,490 | 693,062 |
Other, net | 356,003 | 326,137 |
Total property, plant and equipment | 20,443,464 | 19,507,682 |
Intangible assets | ||
Goodwill | 43,333 | 33,333 |
Other | 59,379 | 46,366 |
Total intangible assets | 102,713 | 79,700 |
Investments and other assets | ||
Investment securities | 6,500,840 | 6,398,836 |
Retirement benefit asset | 357,945 | 372,746 |
Deferred tax assets | 209 | 503 |
Other | 129,806 | 116,953 |
Total investments and other assets | 6,988,802 | 6,889,039 |
Total non-current assets | 27,534,980 | 26,476,422 |
Total assets | 54,636,965 | 57,092,606 |
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OSAKA ORGANIC CHEMICAL INDUSTRY LTD. (4187) Financial Results for the Second Quarter of FY11/24
(Thousands of yen) | ||
FY11/23 | Second quarter of FY11/24 | |
(As of Nov. 30, 2023) | (As of May 31, 2024) | |
Liabilities | ||
Current liabilities | ||
Notes and accounts payable-trade | 3,802,732 | 4,605,343 |
Current portion of bonds payable | 25,000 | 12,500 |
Current portion of long-term borrowings | 1,728,157 | 1,093,029 |
Accounts payable-other | 814,077 | 1,071,178 |
Income taxes payable | 234,679 | 809,737 |
Provision for bonuses for directors (and other | 15,590 | 20,620 |
officers) | ||
Other | 477,814 | 988,494 |
Total current liabilities | 7,098,050 | 8,600,903 |
Non-current liabilities | ||
Long-term borrowings | 3,169,849 | 2,960,375 |
Deferred tax liabilities | 628,650 | 609,048 |
Provision for share awards for directors (and other | 21,107 | 37,698 |
officers) | ||
Other | 90,085 | 89,041 |
Total non-current liabilities | 3,909,693 | 3,696,164 |
Total liabilities | 11,007,743 | 12,297,067 |
Net assets | ||
Shareholders' equity | ||
Share capital | 3,600,295 | 3,600,295 |
Capital surplus | 3,511,017 | 3,513,436 |
Retained earnings | 35,954,913 | 37,379,518 |
Treasury shares | (2,709,700) | (3,129,471) |
Total shareholders' equity | 40,356,525 | 41,363,778 |
Accumulated other comprehensive income | ||
Valuation difference on available-for-sale securities | 2,514,638 | 2,603,879 |
Foreign currency translation adjustment | 125,461 | 171,936 |
Remeasurements of defined benefit plans | (12,589) | (8,244) |
Total accumulated other comprehensive income | 2,627,510 | 2,767,571 |
Non-controlling interests | 645,186 | 664,188 |
Total net assets | 43,629,221 | 44,795,538 |
Total liabilities and net assets | 54,636,965 | 57,092,606 |
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OSAKA ORGANIC CHEMICAL INDUSTRY LTD. (4187) Financial Results for the Second Quarter of FY11/24
-
Quarterly Consolidated Statements of Income and Comprehensive Income Quarterly Consolidated Statement of Income
For the Six-month Period
(Thousands of yen) | ||
First six months of FY11/23 | First six months of FY11/24 | |
(Dec. 1, 2022-May 31, 2023) | (Dec. 1, 2023- May 31, 2024) | |
Net sales | 14,262,357 | 15,338,151 |
Cost of sales | 10,229,667 | 11,021,532 |
Gross profit | 4,032,690 | 4,316,618 |
Selling, general and administrative expenses | 2,093,387 | 2,456,824 |
Operating profit | 1,939,302 | 1,859,793 |
Non-operating income | ||
Interest income | 851 | 1,239 |
Dividend income | 66,922 | 66,183 |
Foreign exchange gains | 1,536 | 67,322 |
Insurance income | 48,576 | - |
Other | 25,095 | 20,012 |
Total non-operating income | 142,982 | 154,757 |
Non-operating expenses | ||
Interest expenses | 2,841 | 4,609 |
Commission for purchase of treasury stock | 3,241 | 602 |
Loss on investments in partnership | 1,966 | 591 |
Donations | - | 20,000 |
Other | 28 | 10 |
Total non-operating expenses | 8,078 | 25,813 |
Ordinary profit | 2,074,206 | 1,988,737 |
Extraordinary income | ||
Gain on sales of non-current assets | 873 | - |
Gain on sales of investment securities | 247,848 | 815,207 |
Total extraordinary income | 248,721 | 815,207 |
Extraordinary losses | ||
Loss on retirement of non-current assets | 898 | 1,048 |
Total extraordinary losses | 898 | 1,048 |
Profit before income taxes | 2,322,029 | 2,802,896 |
Income taxes-current | 731,733 | 814,754 |
Income taxes-deferred | (63,374) | (65,250) |
Total income taxes | 668,359 | 749,503 |
Profit | 1,653,670 | 2,053,393 |
Profit attributable to non-controlling interests | 47,271 | 33,299 |
Profit attributable to owners of parent | 1,606,398 | 2,020,093 |
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OSAKA ORGANIC CHEMICAL INDUSTRY LTD. (4187) Financial Results for the Second Quarter of FY11/24
Quarterly Consolidated Statement of Comprehensive Income
For the Six-month Period
(Thousands of yen)
First six months of FY11/23 (Dec. 1, 2022-May 31, 2023)
First six months of FY11/24 (Dec. 1, 2023- May 31, 2024)
Profit | 1,653,670 | 2,053,393 |
Other comprehensive income | ||
Valuation difference on available-for-sale securities | 253,356 | 94,328 |
Foreign currency translation adjustment | 5,545 | 46,475 |
Remeasurements of defined benefit plans, net of tax | 11,601 | 4,448 |
Total other comprehensive income | 270,503 | 145,252 |
Comprehensive income | 1,924,173 | 2,198,645 |
Comprehensive income attributable to | ||
Comprehensive income attributable to owners of parent | 1,873,568 | 2,160,155 |
Comprehensive income attributable to non-controlling | 50,604 | 38,489 |
interests | ||
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OSAKA ORGANIC CHEMICAL INDUSTRY LTD. (4187) Financial Results for the Second Quarter of FY11/24
(3) Quarterly Consolidated Statement of Cash Flows
(Thousands of yen)
First six months of FY11/23 (Dec. 1, 2022-May 31, 2023)
First six months of FY11/24 (Dec. 1, 2023- May 31, 2024)
Cash flows from operating activities | |||||
Profit before income taxes | 2,322,029 | 2,802,896 | |||
Depreciation | 1,018,006 | 1,589,302 | |||
Amortization of goodwill | 9,999 | 9,999 | |||
Increase (decrease) in allowance for doubtful accounts | (2,049) | 859 | |||
Increase | (decrease) | in | provision for bonuses for | (23,814) | 5,030 |
directors (and other officers) | |||||
Increase (decrease) in provision for share awards for | 5,048 | 16,590 | |||
directors (and other officers) | |||||
Decrease (increase) in retirement benefit asset | 3,675 | (8,400) | |||
Interest and dividend income | (67,773) | (67,423) | |||
Insurance income | (48,576) | - | |||
Interest expenses | 2,841 | 4,609 | |||
Foreign exchange losses (gains) | 8,064 | (29,679) | |||
Donations | - | 20,000 | |||
Loss (gain) on sales of non-current assets | (873) | - | |||
Loss on retirement of non-current assets | 898 | 1,048 | |||
Loss (gain) on investments in partnership | 1,966 | 591 | |||
Loss (gain) on sales of investment securities | (247,848) | (815,207) | |||
Decrease (increase) in trade receivables and contract | 1,143,661 | (461,562) | |||
assets | |||||
Decrease (increase) in inventories | (696,902) | 215,805 | |||
Increase (decrease) in trade payables | (642,335) | 772,336 | |||
Increase | (decrease) | in | consumption taxes payable/ | (290,901) | 932,199 |
consumption taxes refund payable | |||||
Other | 413,635 | 701,890 | |||
Subtotal | 2,908,755 | 5,690,887 | |||
Interest and dividends received | 67,773 | 67,423 | |||
Interest paid | (2,761) | (4,495) | |||
Donations paid | - | (20,000) | |||
Insurance received | 48,576 | - | |||
Income taxes (paid) refund | (1,002,209) | (260,198) | |||
Cash flows from operating activities | 2,020,134 | 5,473,617 | |||
Cash flows from investing activities | |||||
Purchase of property, plant and equipment | (1,175,270) | (593,611) | |||
Proceeds from sales of property, plant and equipment | 1,043 | - | |||
Purchase of intangible assets | (20,760) | - | |||
Purchase of investment securities | (90,000) | - | |||
Proceeds from sales of investment securities | 294,757 | 1,054,352 | |||
Cash flows from investing activities | (990,230) | 460,740 |
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