Presentation Materials for the 2Q of FY2021

November 11, 2021

Presentation for Investors

2Q FY2021 (April 1- September 30, 2021)

Financial Results

Presented by MIYAZAKI Junichi,

Director, Senior Executive Vice President & CFO

Q&A session: YAGI Shinsuke,

Representative Director, President & COO

Translation of presentation materials for the conference call held on November 11, 2021

Changes in Accounting Policies(some figures updated since August 2021)

1.Changes in accounting policies:

Adoption of the Accounting Standard for the Revenue Recognition (ASBJ Statement No.29)

2.Timing of adoption: April 1, 2021 (From FY2021) 3.Major effects on PL, BS due to the changes:

A. Agent transactions

(Mainly effected segments)	Chemicals, Agrochemicals, Trading
(Before adoption)	Sales = gross amount from the customer, Sales expenses = amount paid to the supplier
(After adoption)	Sales = gross amount from the customer - amount paid to the supplier
(Estimated impact on FY2021 PL Outlook as of November 2021)
	Sales and sales expenses down ¥20.5 billion (¥44.6 billion as of May 2021), only deducted from Sales of Adjustment segment
	No impact on Operating Profit
B. Royalties based on sales amount	*MSD: MSD Animal Health, the global animal health business unit of Merck
(Mainly effected segments) Agrochemicals (Fluralaner running royalties)
			MSD* sales	Jan. - March		April - June	July - Sept.	Oct. -Dec.
	Before adoption (until FY2020)			August (2Q)	February (following year) (4Q)
			NCC Royalties
	After adoption (from FY2021)		May (1Q)		August (2Q)	November (3Q)	February
				(following year) (4Q)
C. Sales discount subject to change at the selling timing
(Mainly effected segments)	Agrochemicals
(Before adoption)	Recognized when discount is finally fixed
(After adoption)	Recognized corresponding to sales period based on reasonable estimation

(Estimated impact on FY2021 BS)

The cumulative effect (¥1.5 billion)(after reflecting tax effect) of retroactively applying (C) is deducted from the beginning FY2021 retained earnings (BS item)

Sales discount amount trend after adoption vs. before adoption: 1Q up(negative impact), 2Q down, 1H up, 2H down, Total almost flat

		Sales discount
Before adoption	FY2020	AY2020* (Oct. 2019	- Sept. 2020)
After adoption	FY2020	AY2020* (Oct. 2019	- Sept. 2020)	+ (October 2020 - March 2021) = ¥1.5 billion
	FY2021	April 2021 - March 2022

AY2020* = Agrochemical Year (from Oct. 2019 to Sept. 2020)

2

1H FY2021 Actual Highlight

1. vs. 1H FY2020 Actual

◆OP up ¥3.3 billion (+19%) (1H FY2021 Actual ¥21.3 billion vs. 1H FY2020 Actual ¥18.0 billion) -ChemicalsOP up due to sales increase in melamine, TEPIC and environmental related products

-Performance Materials OP up due to substantial sales increase in Display Materials and Semis Materials -Agro OP down due to changes in accounting policies (Argo's sales discount cost increase),

sales decrease of ALTAIR and GRACIA, Fluralaner shipment decrease and fixed cost up despite Fluralaner royalties increase

-Pharma OP up due to Custom Chemicals sales increase, while LIVALO sales decrease

◆Net Income up ¥2.4 billion (+17%) (1H FY2021 Actual ¥16.3 billion vs. 1H FY2020 Actual ¥13.9 billion)

◆OP, Ordinary Income and Net Income renewed the highest results since 1H FY2018

2. vs. 1H FY2021 Outlook as of May 2021

◆OP above target ¥3.6 billion (1H FY2021 Actual ¥21.3 billion vs. 1H FY2021 Outlook ¥17.7 billion) -ChemicalsOP above target due to sales above target mainly in melamine and TEPIC -PerformanceMaterials OP above target due to sales above target in Display Materials and

Semis Materials

-Agro OP above target due to Fluralaner royalties above target and fixed cost below target -Pharma OP above target due to LIVALO above target

◆Net Income above target ¥2.3 billion (1H FY2021 Actual ¥16.3 billion vs. 1H FY2021 Outlook ¥14.0 billion)

3

2H FY2021 Outlook Highlight

1. vs. 2H FY2020 Actual

◆OP up ¥1.6 billion (+6%) (2H FY2021 Outlook ¥26.1 billion vs. 2H FY2020 Actual ¥24.5 billion) -ChemicalsOP up due to sales increase in melamine and environmental related products -PerformanceMaterials OP up due to sales increase in Display Materials and Semis Materials -AgroOP up due to changes in accounting policies (Argo's sales discount cost decrease) and

sales increase in Fluralaner and DITHANE

-Pharma OP down due to sales decrease in LIVALO and Custom Chemicals

◆Net Income up ¥0.5 billion (+3%) (2H FY2021 Outlook ¥20.1 billion vs. 2H FY2020 Actual ¥19.6 billion)

2. vs. 2H FY2021 Outlook as of May 2021

◆OP above target ¥0.2 billion (2H FY2021 Outlook as of Nov. ¥26.1 billion vs. 2H FY2021 Outlook as of May ¥25.9 billion)

-Chemicals OP above target due to sales above target mainly in melamine and TEPIC,

inventory adjustment cost below expectations, while feedstock and raw materials cost above expectations -Performance Materials OP above target due to sales increase in Display Materials and Semis Materials -Agro OP below target due to sales below target mainly in GRACIA and ALTAIR, despite Fluralaner increase -Pharma OP below target due to LIVALO sales below target

◆Net Income in line with target (2H FY2021 Outlook as of Nov. ¥20.1 billion vs. 2H FY2021 Outlook as of May ¥20.1 billion)

4

Full Year FY2021 Outlook Highlight

1. vs. Full Year FY2020 Actual

◆OP up ¥4.9 billion (+11%) (FY2021 Outlook as of Nov. ¥47.4 billion vs. FY2020 Actual ¥42.5 billion)

-Chemicals OP up due to sales increase in melamine, TEPIC and environmental related products -Performance Materials OP up due to sales increase in Display Materials and Semis Materials -Agro OP flat due to fixed cost up and sales decrease in GRACIA and ALTAIR

-Pharma OP up due to Custom Chemicals sales increase and inventory adjustment cost down, while LIVALO sales decrease

◆Net Income up ¥2.9 billion (+9%) (FY2021 Outlook as of Nov. ¥36.4 billion vs. FY2020 Actual ¥33.5 billion) ◆Despite COVID-19, OP and Ordinary Income expected to renew the highest results of a full year

in 8 consecutive years, and Net Income expected to renew the annual highest results in 9 consecutive years ◆ROE 18.1% (first time in the 18% range), higher than FY2020 Actual 17.5%,

FY2021 Outlook as of May 2021 17.0%, Mid-term Plan target 16%

2. vs. Full Year FY2021 Outlook as of May 2021

◆OP above target ¥3.8 billion (FY2021 Outlook as of Nov. ¥47.4 billion vs. FY2021 Outlook as of May ¥43.6 billion)

-Chemicals OP above target due to sales above target mainly in melamine and TEPIC, inventory adjustment cost below expectations, while feedstock and raw materials cost above expectations

-Performance Materials OP above target due to sales above target in Display Materials and Semis Materials

-Agro OP above target due to Fluralaner sales above target and inventory adjustment cost below expectations -Pharma OP above target due to LIVALO sales above target

◆Net Income above target ¥2.3 billion (FY2021 Outlook as of Nov. ¥36.4 billion vs. Outlook as of May ¥34.1 billion)

3. vs. Mid-term Plan announced in May 2019 (see p50, 52)

◆Despite COVID-19, OP above target ¥4.4 billion, Ordinary Income above target ¥4.8 billion, and Net Income above target ¥3.4 billion (Mid-term Plan: OP ¥43.0 billion, Ordinary Income ¥44.0 billion, Net Income ¥33.0 billion)

4．Shareholders Return

◆Annual dividend up ¥10 (FY2021 Outlook as of Nov. ¥114 =1H 50 + 2H 64 vs. FY2020 Actual ¥104 =1H 46 + 2H 58), up ¥6 vs. FY2021 Outlook as of May ¥108 = 1H 48 + 2H 60, dividend payout ratio 44.7% vs. FY2020 Actual 44.9%

◆As a result, dividend increasing in 10 consecutive years
◆Completed a ¥7.0 billion share repurchase program in July 2021
◆Total payout ratio target 75% (expected to be 64% only taking into account of ¥114/share dividend and ¥7.0
billion share repurchase program)	5