(English Translation)
This English translation is an abridged version of the original document in Japanese. In the event of any discrepancy, the Japanese version prevail.
1H FY11/24
July 11, 2024
Presentation Materials for Financial Results for the First Half of the Fiscal Year Ending November 30, 2024
Our products are invisible, but used around you.
OSAKA ORGANIC CHEMICAL INDUSTRY LTD.
Tokyo Stock Exchange, Prime Market: 4187
Contents | 2 |
01
02
03
04
1H FY11/24 Financial Summary
FY11/24 Forecast
Medium-Term Business Plan P&D 2030
appendix
1H FY11/24 Financial Summary | 3 |
Operating environment | Net sales | Operating profit |
While the employment and income situation has improved and a gradual recovery has been seen, the outlook remains uncertain due to global monetary tightening and concerns about the outlook for the Chinese economy, as well as the impacts of overseas economies, the yen's depreciation and price increases.
Sales of chemical products increased significantly, and sales of electronic materials increased slightly. On the other hand, sales of functional chemicals declined. As a result, net sales increased 7.5% year on year to 15,338 million yen.
Depreciation and amortization expenses increased for the semiconductor materials manufacturing facilities completed last year, and operating profit decreased 4.1% year on year to 1,859 million yen.
(Millions of yen)
1H FY11/23
results
Net sales | 14,262 |
1H FY11/24
forecast
(Revised June 26th)
15,300
1H FY11/24
results
15,338
YoY change
Amount | % |
+1,075+7.5%
Operating profit | 1,939 | 1,850 | 1,859 | -79 | -4.1% | |
Ordinary profit | 2,074 | 1,950 | 1,988 | -85 | -4.1% | |
Profit attributable to | 1,606 | 2,000 | 2,020 | +413 | +25.8% | |
owners of parent | ||||||
Price of naphtha in Japan | 66,750 | ＊70,000 | 75,750 | ― | ― | |
(Yen/KL) | ||||||
(Our estimated value) | ||||||
Exchange rate | 134 | ＊145 | 150 | ― | ― | |
(Yen/USD) | ||||||
＊；initial assumptions
Factors Affecting Operating Profit | 4 |
Although sales of chemical products increased substantially, an increase in depreciation expenses had a significant impact, resulting in a ¥ 0.08 billion decrease in operating profit.
Increase in net sales
+¥ 1.07 billion
Chemical products | +¥ 1.41 billion |
Electronics materials | +¥ 0.09 billion |
Specialty chemicals | -¥ 0.42 billion |
Increase in cost of sales
+¥ 0.79 billion
Increase in cost of raw materials | +¥ 0.42 billion |
Inventory valuation | -¥ 0.04 billion |
Increase in repair expenses | +¥ 0.06 billion |
Increase in depreciation | +¥ 0.33 billion |
Others | |
Increases in SG&A
+¥ 0.36 billion
Increase in personnel expenses | +¥ 0.04 billion |
Increase in depreciation | +¥ 0.23 billion |
Increase in transportation | +¥ 0.04 billion |
expenses | Others |
Increase in | Blue / ↑: Positive factors | ||||
Increase in | Red / ↓: Negative factors | ||||
cost of sales | |||||
net sales | |||||
Increases in | |||||
SG&A | |||||
Operating profit | Operating profit | ||||
¥ 1.93 billion | ¥ 1.85 billion | ||||
Operating Profit | -¥ 0.08 billion | ||||
0.00 | |||||
1H FY11/23 | Change in net sales | Change in cost of goods sold | Change in SG&A | 1H FY11/24 |
Results by Segment | 5 |
■ Chemical products
Sales for automotive coatings decreased, but sales for display adhesives and UV inkjet inks increased significantly, resulting in a significant year-on-year increase in both sales and operating profit.
■ Electronics materials
Sales of semiconductor materials declined compared with the previous fiscal year, despite signs of recovery due to prolonged inventory adjustments. Sales of display materials for insulating films for touch panels increased. Higher depreciation and amortization resulted in higher sales and lower profits compared with the previous fiscal year.
■ Specialty chemicals
Sales of cosmetic raw materials remained firm overseas. In performance materials, sales of consignment products decreased. Sales of high- purity specialty solvents at subsidiaries decreased. Sales and profits decrease compared with the previous fiscal year.
(billion yen)
Chemical products
Electronics materials
Specialty chemicals
Net sales | 5.99 | 6.65 | 2.68 |
(YoY: +30.8%) | (YoY: +1.4%) | (YoY: -13.8%) | |
Operating profit | 0.84 | 0.64 | 0.35 |
(YoY: +166.2%) | (YoY: -39.3%) | (YoY: -36.7%) | |
Net sales
(Billions of yen)
Net sales and operating margin by segment
OP margin | Chemical products |
(%) |
20 | 30 | |
27.4 | ||
Electronics materials
23.422.6
2.95 | 3.02 |
20.1 | |
7.54 | |
7.67 | |
9.9 | |
4.8 |
3.11 | 18.1 | 2.71 | 2.68 | Specialty chemicals | |
16.2 | 15.1 | 14.2 | 15 | ||
6.21 | 13.3 | Chemical products | |||
(Operating margin) | |||||
6.56 | 6.65 | ||||
11.0 | |||||
9.7 | 9.7 | Electronics materials | |||
7.0 | (Operating margin) |
5.65 | 5.38 | 4.58 | 5.72 | 5.99 | Specialty chemicals | ||
0 | 0 | ||||||
1H FY11/22 | 2H FY11/22 | 1H FY11/23 | 2H FY11/23 | 1H FY11/24 | (Operating margin) | ||
Capital Expenditures, Depreciation, R&D Expenses | 6 |
Capital expenditures totaled ¥8.66 billion in 2023, which included the expansion of semiconductor materials manufacturing facilities. As a result, depreciation and amortization expenses increased significantly in 2024.
R&D expenses also increased due to an increase in depreciation expenses for semiconductor materials testing and research facilities.
Capital expenditures | 8,666 | (Millions of yen) | ||
Depreciation | ||||
R&D expenses | ||||
4,776 | ||||
3,350 | ||||
2,452 | 2,304 | 2,448 | 2,330 | |
2,085 | ||||
1,843 | ||||
1,646 | 1,169 | 1,436 | 1,599 | |
1,209 | 1,289 | 1,233 | ||
899 | ||||
468 | ||||
FY11/20 | FY11/21 | FY11/22 | FY11/23 | FY11/24 (1H) |
Bars shown by the dotted lines indicate FY11/24 forecast
Contents | 7 |
01
1H FY11/24 Financial Summary
02
FY11/24 Forecast
03
Medium-Term Business Plan P&D 2030
04
appendix
Progress against FY11/2024 Forecast | 8 |
On June 26, 2024, we revised our earnings forecasts and forecast net sales and operating profit for the fiscal year ending November 2024 to be ¥32 billion and ¥4.2 billion, respectively.
Sales reached 47.9% of the forecast and operating income 44.3% of the forecast for the first half of the fiscal year.
However, performance is generally favorable as a recovery in semiconductor materials is anticipated in the second half of the fiscal year.
(Millions of yen)
FY11/23 results
Net sales | 28,907 |
FY11/24 forecast
(revised on Jun 26)
32,000
YoY change
Amount | % |
+3,093 +10.7%
1H FY11/24
results
15,338
1H Progress
ratio
47.9%
Operating profit | 3,577 | 4,200 | +623 | +17.4% | 1,859 | 44.3% |
Ordinary profit | 3,877 | 4,400 | +523 | +13.5% | 1,988 | 45.2% |
Profit attributable to | 3,270 | 3,700 | +430 | +13.1% | 2,020 | 54.6% |
owners of parent | ||||||
Price of naphtha in Japan | 68,150 | *70,000 | ― | ― | 75,750 | ― |
(Yen/KL) | ||||||
(Our estimated value) | ||||||
Exchange rate (Yen/USD) | 140 | *145 | ― | ― | 150 | ― |
* ; initial assumptions
■ Chemical Products | 9 | |||||||
1H FY11/24 | FY11/24 | Progress rate | Net sales / Operating margin | |||||
Full-year forecast | ||||||||
Net sales | vs. Full-year forecast | |||||||
(revised on Jun 26) | ||||||||
¥ 5.99 bn | ¥ 12.00 bn | 49.9 % | (Billions of | Net sales | ||||
yen) | Operating margin(right axis) | |||||||
(%) | ||||||||
●Operating environment | 7.0 | 20 | ||||||
5.99 6.01 | ||||||||
・Automotive production has continued to recover but has stalled somewhat this year. | ||||||||
・In display-related products, sales for large-scale TVs and automotive applications were | 5.65 | 5.72 | ||||||
firm. | 5.38 |
・The UV inkjet market also remained strong.
●OOC | 4.58 |
14.2 | |
・Sales to overseas markets such as China grew. | |
・Profit margins have also improved significantly through product consolidation and | |
discontinuation. | 10 |
・Sales for automotive coatings applications decreased. | |
11.0 | |
・Sales for display adhesives increased significantly. | 9.9 |
・Sales of materials for UV inkjet inks also increased compared to the previous year. | |
・Biomass acrylate also grew steadily. | |
●Market risks | 7.0 |
・Crude oil prices remain high. | 4.8 |
・Higher cost of raw materials derived from natural resources. |
0.0
0
(Dotted line: Forecast)
■ Electronics Materials | 10 | |||||||||
1H FY11/24 | FY11/24 | Progress rate | Net sales / Operating margin | |||||||
Full-year forecast | ||||||||||
Net sales | vs. Full-year forecast | |||||||||
(revised on Jun 26) | ||||||||||
¥ 6.65 bn | ¥ 14.70 bn | 45.2 % | Net sales | |||||||
(Billions of yen) | Operating margin(right axis) | |||||||||
(%) | ||||||||||
●Operating environment | 9.0 | 50 | ||||||||
8.05 | ||||||||||
・The semiconductor market is showing a recovery trend. | 7.54 | 7.67 | ||||||||
・Progress is continuing with the practical use of state-of-the-art EUV | ||||||||||
lithography. | 6.56 | 6.65 | ||||||||
・In display-related products, sales for large-scale | TVs and automotive | |||||||||
applications were firm. | 6.21 | |||||||||
・The PC and smartphone markets were stagnant. | ||||||||||
●OOC | ||||||||||
・Semiconductor materials showed signs of recovery, but were negative year-on- | 27.4 | 25 | ||||||||
year. | ||||||||||
・Materials for EUV applications increased steadily in the first half. | 22.6 | |||||||||
・In the display materials group, sales for insulating films for touch panels | ||||||||||
increased. | ||||||||||
●Market risks | 16.2 | |||||||||
・Escalation of the U.S.-China economic confrontation. | 9.7 | 9.7 | ||||||||
0.0
0
(Dotted line: Forecast)