ENGLISH TRANSLATION OF JAPANESE-LANGUAGE DOCUMENT
This is a translation of the original Japanese-language document and is provided for convenience only. In all cases, the Japanese-language original shall take precedence.
Consolidated Financial Results for the Six Months Ended June 30, 2022 (Japan GAAP) (The fiscal year ending December 31, 2022)
August 10, 2022
Stock Exchange: Tokyo
Head Office: Tokyo
Tel: +81 (3) 6733-3000
Company Name: DIC Corporation
Listing Code Number: 4631 | Scheduled Filing Date of Quarterly Securities Report: August 10, 2022 |
URL: https://www.dic-global.com/en/ | Dividend Payment: September 1, 2022 |
Representative: Kaoru Ino, Representative Director, President and CEO | |
Contact Person: Jun Kaneko, General Manager, Accounting Department |
Preparation of Supplemental Explanatory Materials: Yes
Holding of Quarterly Financial Results Meeting: Yes (for security analysts and institutional investors, etc.)
(Yen amounts are rounded to the nearest million, except for per share information)
1. Consolidated Financial Results for the Six Months Ended June 30, 2022 (January 1, 2022 - June 30, 2022)
(1) Consolidated operating results | (Percentages indicate year-on-year changes) | |||||||
Net sales | Operating income | Ordinary income | Net income attributable to | |||||
owners of the parent | ||||||||
JPY (million) | % | JPY (million) | % | JPY (million) | % | JPY (million) | % | |
Six months ended June 30, 2022 | 521,411 | 33.1 | 23,966 | -12.2 | 26,151 | -7.4 | 14,390 | -10.2 |
Six months ended June 30, 2021 | 391,793 | 14.0 | 27,303 | 53.1 | 28,239 | 81.5 | 16,028 | 55.1 |
Note: Comprehensive income (JPY million): | Six months ended June 30, 2022 | 67,687 (74.9%) | ||||||||||
Six months ended June 30, 2021 | 38,709 (-%) | |||||||||||
Earnings per | Earnings per | |||||||||||
share (basic) | share (diluted) | |||||||||||
152.03 | JPY | JPY | ||||||||||
Six months ended June 30, 2022 | - | |||||||||||
Six months ended June 30, 2021 | 169.33 | - | ||||||||||
(2) Consolidated financial position | ||||||||||||
Total assets | Net assets | Shareholders' equity ratio | ||||||||||
to total assets | ||||||||||||
JPY (million) | JPY (million) | % | ||||||||||
As of June 30, 2022 | 1,309,388 | 441,559 | 31.1 | |||||||||
As of December 31, 2021 | 1,071,481 | 381,008 | 32.3 | |||||||||
Reference: Shareholders' equity (JPY million): | As of June 30, 2022 | 406,795 As of December 31, 2021 345,927 | ||||||||||
2. Cash Dividends | ||||||||||||
Cash dividends per share | ||||||||||||
(Record date) | End of 1st quarter | End of 2nd quarter | End of 3rd quarter | Year-end | Annual | |||||||
JPY | JPY | JPY | JPY | JPY | ||||||||
FY2021 | - | 50.00 | - | 50.00 | 100.00 | |||||||
FY2022 | - | 50.00 | ||||||||||
FY2022 (Plan) | - | 50.00 | 100.00 |
Note: Revision of the forecasts for the dividends payment: None
3. Forecasts for Consolidated Operating Results for the Fiscal Year Ending December 31, 2022 (January 1, 2022 - December 31, 2022)
(Percentages indicate year-on-year changes)
Net income | Earnings per | ||||||||
Net sales | Operating income | Ordinary income | attributable to | ||||||
share (basic) | |||||||||
owners of the parent | |||||||||
JPY (million) | % | JPY (million) | % | JPY (million) | % | JPY (million) | % | JPY | |
FY2022 | 1,100,000 | 28.6 | 50,000 | 16.6 | 51,000 | 16.6 | 26,000 | 495.6 | 274.68 |
Note: Revision of the forecasts for the consolidated operating results for the fiscal year ending December 31, 2022: Yes
For details, please refer to "Analysis of Results of Operations (3) Operating Results Forecasts for Fiscal Year 2022" on page 4.
ENGLISH TRANSLATION OF JAPANESE-LANGUAGE DOCUMENT
This is a translation of the original Japanese-language document and is provided for convenience only. In all cases, the Japanese-language original shall take precedence.
Notes
-
Changes in the scope of consolidation for significant subsidiaries during the six months ended June 30, 2022: None (Changes in specified subsidiaries resulting in the change in scope of consolidation)
Newly included: - (Company name) - Excluded: - (Company name) - - Adoption of accounting methods which are exceptional for quarterly consolidated financial statements: Yes
- Changes in accounting policies and accounting estimates, and restatements
- Changes in accounting policies arising from revision of accounting standards: Yes
2) | Changes in accounting policies other than 1): | None |
3) | Changes in accounting estimates: | None |
4) | Restatements: | None |
- Number of shares issued (common stock)
- Number of shares issued at the end of the period, including treasury shares
As of June 30, 2022 | 95,156,904 shares, | As of December 31, 2021 | 95,156,904 shares | |
2) | Number of treasury shares at the end of the period | |||
As of June 30, 2022 | 503,044 shares, | As of December 31, 2021 | 501,950 shares | |
3) | Average number of shares issued during the period, excluding treasury shares | |||
For the six months ended June 30, 2022 | 94,654,474 shares, | For the six months ended June 30, 2021 | 94,655,033 shares |
- Since the fiscal year ended December 31, 2017, the Company has introduced the Board Benefit Trust (BBT). The shares held by the trust are included in the number of treasury shares.
Note: Quarterly consolidated financial results in this report are not subject to quarterly review procedures conducted by certified public accountants or audit firms.
Note: Explanation of the appropriate use of performance forecasts, and other special items
Caution concerning forward-looking statements
The above forecasts of future performance are based on information available to the Company at the present time and are subject to potential risks and uncertainty. Accordingly, the users should be aware that actual results may differ from any expressed future performance herein due to various factors.
For information regarding the assumptions used to prepare the forecasts, please refer to page 4.
ENGLISH TRANSLATION OF JAPANESE-LANGUAGE DOCUMENT
This is a translation of the original Japanese-language document and is provided for convenience only. In all cases, the Japanese-language original shall take precedence.
Analysis of Results of Operations
(1) Overview of Operating Results
(Billions of yen) | |||||
Six months ended | Six months ended | Change | Change (%) | ||
June 30, 2021 | June 30, 2022 | (%) | 〔Local currency basis〕 | ||
Net sales | 391.8 | 521.4 | 33.1% | 26.8% | |
Operating income | 27.3 | 24.0 | -12.2% | -10.2% | |
Ordinary income | 28.2 | 26.2 | -7.4% | - | |
Net income attributable to | 16.0 | 14.4 | -10.2% | - | |
owners of the parent | |||||
EBITDA * | 38.2 | 47.4 | 24.2% | - | |
¥/US$1.00 (Average rate) | 107.68 | 123.25 | 14.5% | - | |
¥/EUR1.00 (Average rate) | 129.63 | 134.89 | 4.1% | - | |
* EBITDA: Net income attributable to owners of the parent + Total income taxes + (Interest expenses - Interest income) + Depreciation and amortization
In the six months ended June 30, 2022, consolidated net sales climbed 33.1%, to ¥521.4 billion. This sharp increase reflected ongoing efforts to adjust sales prices for a wide range of products across all segments and was despite the impact of persistently high energy, logistics and raw materials costs amid increasing global economic uncertainty caused by, among others, rising resource prices, a consequence of the situation in Ukraine, and supply chain disruptions, ascribed to a resurgence of COVID-19 in the People's Republic of China (PRC) and elsewhere. In the Color & Display segment, the margin of improvement in net sales was boosted by the addition of sales from the C&E pigments business, which was not included in the scope of consolidation in the corresponding period of the previous fiscal year. Amid an unclear global economic outlook and prolonged supply chain turmoil, shipments for certain products and regions showed signs of stagnation, hindered by falling automobile production and the impact of pandemic lockdowns in the PRC.
Operating income, at ¥24.0 billion, was down 12.2%. With shipments for a number of products and regions languishing, attempts were made to modify sales prices for a wide range of products to pass on increases in energy, logistics and raw materials costs. However, such moves fell short. Against this backdrop, the C&E pigments business shifted into the black as shipment delays-caused by the fact that it took some time to build a logistics configuration following the business' integration-were resolved, underpinning firm sales.
Ordinary income declined 7.4%, to ¥26.2 billion. The margin of decline was narrower than that for operating income thanks to an increase in foreign exchange gains, among others.
Net income attributable to owners of the parent, decreased 10.2%, to ¥14.4 billion.
Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 24.2%, to ¥47.4 billion.
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ENGLISH TRANSLATION OF JAPANESE-LANGUAGE DOCUMENT
This is a translation of the original Japanese-language document and is provided for convenience only. In all cases, the Japanese-language original shall take precedence.
(2) Segment Results
(Billions of yen) | |||||||||||||||||
Net sales | Operating income (loss) | ||||||||||||||||
Six months | Change | Six months | Change | ||||||||||||||
Six months | Change | (%) | Six months | Change | (%) | ||||||||||||
ended | ended | 〔Local | ended | ended | 〔Local | ||||||||||||
(%) | (%) | ||||||||||||||||
June 30, 2021 | June 30, 2022 | currency | June 30, 2021 | June 30, 2022 | currency | ||||||||||||
basis〕 | basis〕 | ||||||||||||||||
Packaging & | 211.0 | 257.4 | 22.0% | 17.2% | 10.5 | 7.7 | -26.9% | -16.9% | |||||||||
Graphic | |||||||||||||||||
Color & | 59.2 | 133.9 | 126.2% | 107.8% | 7.0 | 7.8 | 11.0% | 10.3% | |||||||||
Display | |||||||||||||||||
Functional | 137.4 | 153.2 | 11.6% | 7.4% | 14.1 | 13.3 | -5.5% | -8.3% | |||||||||
Products | |||||||||||||||||
Others, | (23.1) | (4.8) | |||||||||||||||
Corporate and | (15.8) | ― | ― | (4.3) | ― | ― | |||||||||||
eliminations | |||||||||||||||||
Total | 391.8 | 521.4 | 33.1% | 26.8% | 27.3 | 24.0 | -12.2% | -10.2% | |||||||||
Packaging & Graphic | |||||||||||||||||
Six months | Six months | Change (%) | |||||||||||||||
ended | ended | Change (%) | |||||||||||||||
〔Local currency basis〕 | |||||||||||||||||
June 30, 2021 | June 30, 2022 | ||||||||||||||||
Net sales | ¥211.0 billion | ¥257.4 billion | 22.0% | 17.2% | |||||||||||||
Operating income | ¥10.5 billion | ¥7.7 billion | -26.9% | -16.9% | |||||||||||||
Segment sales advanced 22.0%, to ¥257.4 billion. In materials for food packaging, sales of packaging inks increased, supported by continued efforts to adjust sales prices on a global scale. Nonetheless, shipments in Asia were down from the corresponding period of the previous fiscal year, as those in the PRC remained listless despite the repeal of lockdowns. In publication inks, which center on inks for commercial printing and news inks, a limited recovery in Japan for use in pamphlets and event-related printed materials following the lifting of targeted measures to prevent the spread of COVID-19 and flagging demand in the Americas and Europe due to paper shortages caused shipments in these regions to slump, but sales rose thanks to assertive sales price adjustments worldwide. Sales of jet inks for digital printing increased, buttressed by persistently brisk sales for industrial applications, including outdoor signage (billboards and posters) and banners, and for commercial printing. The inclusion of the sales of Italian adhesives manufacturer Sapici S.p.A., the acquisition of which was completed in January 2022, also bolstered segment sales.
Segment operating income fell 26.9%, to ¥7.7 billion. Despite seeking to counter increases in energy, logistics and raw materials costs worldwide by modifying sales prices, such attempts struggled to keep pace, as a result of which operating income declined in all regions. Against this backdrop, the successful completion of the post-acquisition integration of Sapici's operations and moves to boost sales of adhesives led to steady growth in the Italian company's profits.
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ENGLISH TRANSLATION OF JAPANESE-LANGUAGE DOCUMENT
This is a translation of the original Japanese-language document and is provided for convenience only. In all cases, the Japanese-language original shall take precedence.
Color & Display
Six months | Six months | Change (%) | ||
ended | ended | Change (%) | ||
〔Local currency basis〕 | ||||
June 30, 2021 | June 30, 2022 | |||
Net sales | ¥59.2 billion | ¥133.9 billion | 126.2% | 107.8% |
Operating income | ¥7.0 billion | ¥7.8 billion | 11.0% | 10.3% |
Segment sales soared 126.2%, to ¥133.9 billion. Owing to the addition of sales from the C&E pigments business, sales of pigments for coatings, plastics and cosmetics increased sharply. Shipments of pigments for cosmetics rose as a recovery in demand came into focus, underpinned by a shift away from wearing face masks overseas. In display materials, sales of pigments for color filters decreased, as production adjustments by display manufacturers depressed shipments. In pigments for specialty applications, which center on effect pigments, sales of pigments for agricultural uses remained firm, although sales of those for building materials, used in autoclaved aerated concrete, declined in Europe, the principal market for these products.
Segment operating income, at ¥7.8 billion, was up 11.0%. Although shipments of certain high-value-added products, notably pigments for color filters and specialty applications, flagged, decisive steps were taken to modify sales prices, including the assessment of surcharges. The segment operating income reflected the fact that the C&E pigments business reported a profit, as the resolution of shipment delays supported firm sales.
Functional Products
Six months | Six months | Change (%) | ||
ended | ended | Change (%) | ||
〔Local currency basis〕 | ||||
June 30, 2021 | June 30, 2022 | |||
Net sales | ¥137.4 billion | ¥153.2 billion | 11.6% | 7.4% |
Operating income | ¥14.1 billion | ¥13.3 billion | -5.5% | -8.3% |
Segment sales advanced 11.6%, to ¥153.2 billion. In digital materials, used principally in electrical and electronics equipment and displays, sales of epoxy resins-the principal application for which is semiconductor devices-increased, buttressed by effective efforts to capture robust demand in electronics equipment markets and successful attempts to adjust sales prices, which countered the persistent impact of COVID-19 on shipments overseas even after the repeal of lockdowns in the PRC. Sales of industrial-use tapes, used mainly in smartphones and other mobile devices, also rose, bolstered by persistent moves to lock in demand. In industrial materials, used primarily in mobility solutions, shipments were affected by falling automobile production, a consequence of semiconductor shortages and turmoil on the logistics front, but sales price adjustments pushed up sales of core products other than polyphenylene sulfide (PPS) compounds. Sales of PPS compounds were essentially level, despite progress in modifying sales prices, as shipments fell both in Japan and overseas.
Segment operating income decreased 5.5%, to ¥13.3 billion. This was despite efforts to adjust sales prices to pass on energy, logistics and raw materials cost increases amid falling shipments, particularly of materials for automotive applications, as such moves fell short.
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DIC Corporation published this content on 10 August 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 August 2022 03:23:01 UTC.