Osaka Organic Chemical Industry : Consolidated Financial Results for the Third Quarter of the Fiscal Year Ending November 30, 2022（October 7, 2022 151KB）

Translation

Notice: This document is an excerpt translation of the original Japanese document and is for reference purposes only. In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

Consolidated Financial Results for the Third Quarter of the

Fiscal Year Ending November 30, 2022 (FY11/22)

(Nine Months Ended August 31, 2022)

[Japanese GAAP]

		October 7, 2022
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
Contact:	Soichi Honda, Director, Corporate Officer, General Manager of Administration Division
	TEL: [phone]

Scheduled date of filing of Quarterly Report:	October 7, 2022
Scheduled date of dividend payment:	-
Preparation of supplementary materials for quarterly financial	None
results:
Holding of quarterly financial results meeting:	None
	(All amounts are rounded down to the nearest million yen)

1. Consolidated Financial Results for the Third Quarter of FY11/22 (December 1, 2021 to August 31, 2022)

(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	%
	Nine months ended Aug. 31, 2022	24,317	-		4,531	7.4		4,921		8.2	3,417	(0.9)
	Nine months ended Aug. 31, 2021	25,757	21.4		4,220	26.2		4,548		30.4	3,447	43.9
	Note: Comprehensive income (millions of yen)	Nine months ended Aug. 31, 2022:	3,384		(down 14.5%)
			Nine months ended Aug. 31, 2021:	3,958		(up 70.0%)
		Net income per share		Diluted net income per share
				Yen				Yen
	Nine months ended Aug. 31, 2022		156.34				-
	Nine months ended Aug. 31, 2021		155.62				-

Note: "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020), etc. have been applied since the beginning of the first quarter of the consolidated fiscal year ending November, 2022, and the figures stated for the period under review are adjusted following the application of the above-mentioned accounting standard, etc. Therefore, the year-on- year change of net sales for the period under review is omitted.

(2) Consolidated financial position

	Total assets	Net assets	Equity ratio
	Millions of yen	Millions of yen	%
As of Aug. 31, 2022	52,998	39,933	74.3
As of Nov. 30, 2021	49,868	39,125	77.5

Reference: Shareholders' equity (millions of yen) As of Aug. 31, 2022: 39,393 As of Nov. 30, 2021: 38,645 Note: "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020), etc. have been applied since the

beginning of the first quarter of the consolidated fiscal year ending November, 2022, and the figures stated for the period under review are adjusted following the application of the above-mentioned accounting standard, etc.

2. Dividends

			Dividend per share
	1Q-end	2Q-end	3Q-end		Year-end	Total
	Yen	Yen	Yen		Yen	Yen
Fiscal year ended Nov. 30, 2021	-	25.00	-		25.00		50.00
Fiscal year ending Nov. 30, 2022	-	27.00	-
Fiscal year ending Nov. 30, 2022					26.00		53.00
(Forecast)
Note: Revisions to the most recently announced dividend forecast: None

3. Consolidated Forecast for FY11/22 (December 1, 2021 to November 30, 2022)

							(Percentages represent year-on-year changes)
	Net sales		Operating profit	Ordinary profit	Profit attributable to	Net income per
		owners of parent	share
	Millions of yen		%	Millions of yen	%	Millions of yen	%	Millions of yen	%	Yen
Full year	33,000		-	5,900	0.8	6,150	(1.7)	4,200	(16.0)	189.59

Note: Revisions to the most recently announced consolidated forecast: None

Note: "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020), etc. have been applied since the beginning of the first quarter of the consolidated fiscal year ending November, 2022, and the forecast figures stated for the period under review are adjusted following the application of the above-mentioned accounting standard, etc. Therefore, changes in net sales compared with the previous consolidated fiscal year is omitted.

* Notes

(1) Changes in significant subsidiaries during the period (change in scope of consolidation): None

Newly added: -

Excluded: -

1. Application of special accounting methods for presenting quarterly consolidated financial statements: None
2. Changes in accounting policies and accounting-based estimates, and restatements
3. 1. Changes in accounting policies due to revisions in accounting standards, others: Yes
   2. Changes in accounting policies other than 1) above: None
   3. Changes in accounting-based estimates: None
   4. Restatements: None

Note: For details, please refer to "2. Quarterly Consolidated Financial Statements and Notes; (3) Notes to Quarterly Consolidated Financial Statements (Changes in Accounting Policies)" on page 8 (Attachment) of this quarterly financial report.

(4) Number of shares issued (common shares)

1) Number of shares issued at the end of the period (including treasury shares)

As of Aug. 31, 2022:	22,410,038 shares	As of Nov. 30, 2021:	22,410,038 shares
2) Number of treasury shares at the end of the period
As of Aug. 31, 2022:	847,458 shares	As of Nov. 30, 2021:	256,517 shares
3) Average number of shares during the period
Nine months ended Aug. 31, 2022:	21,859,606 shares	Nine months ended Aug. 31, 2021:	22,152,920 shares

• 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 above forecasts 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 Third Quarter of FY11/22

Contents of Attachments

1. Qualitative Information on Quarterly Consolidated Financial Performance	2
(1)	Explanation of Results of Operations	2
(2)	Explanation of Financial Position	3
(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
(3)	Notes to Quarterly Consolidated Financial Statements	8
	Going Concern Assumption	8
	Significant Changes in Shareholders' Equity	8
	Change in Accounting Policies	8
	Additional Information	9
	Segment and Other Information	9
	Significant Subsequent Events	10

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OSAKA ORGANIC CHEMICAL INDUSTRY LTD. (4187) Financial Results for the Third Quarter of FY11/22

1. Qualitative Information on Quarterly Consolidated Financial Performance

(1) Explanation of Results of Operations

During the first nine months of the current consolidated fiscal year, the Japanese economy was on a moderate recovery trend as economic activities continued to normalize despite the effect of the resurgence of COVID-19 cases. However, the Japanese economy continued to face uncertain outlook due to the protracted situation in Ukraine and lockdowns in China, in addition to soaring raw materials costs and rapid fluctuations in the foreign exchange markets.

The Osaka Organic Chemical Industry Group started its Second Five-yearMedium-term Business Plan in the fiscal year that ended in November 2020. This plan is the second half of Next Stage 10, a long-term business plan covering the 10- year period that began with the fiscal year that ended in November 2015. Many activities are under way to accomplish the goals of this plan. In the chemical products business, we are focusing on improving profitability by concentrating investments on carefully selected categories in order to revitalize the product lineup. Another priority is increasing sales of raw materials for specialty ink for UV inkjet printers as the market for these printers grows worldwide. In the electronics materials business, we are strengthening activities for developing next-generation semiconductor materials to be the market leader in targeted categories and for increasing sales of new display materials. In the specialty chemicals business, there are measures to develop functional polymers and increase sales of raw materials for cosmetics and of high-purity specialty solvents.

As a result, net sales for the period under review were 24,317 million yen (-% year on year), operating profit was 4,531 million yen (up 7.4% year on year), ordinary profit was 4,921 million yen (up 8.2% year on year), and profit attributable to owners of parent was 3,417 million yen (down 0.9% year on year). It should be noted that "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020; hereinafter, "Accounting Standard for Revenue Recognition"), etc. have been applied since the beginning of the first quarter under review in accordance with a transitional treatment. As a result, net sales decreased by 3,956 million yen, cost of sales shrank 3,980 million yen, operating profit, ordinary profit and profit before income taxes increased 24 million yen, respectively, compared with those calculated according to the conventional accounting treatment method. Furthermore, the year-on-year change of net sales is omitted. For more information, please refer to "2. Quarterly Consolidated Financial Statements and Notes, (3) Notes to Quarterly Consolidated Financial Statements, (Changes in Accounting Policies)."

Business results by segment are explained below (excluding inter-segment transactions).

1) Chemical products

Regarding acrylic acid ester, while sales of esters used in automotive coatings remained weak due to a decrease in production of automobiles, and sales of esters used in displays started decreasing, sales of chemical products used in UV inkjet printers remained strong. Methacrylic acid esters recorded strong sales. As a result, net sales were 8,506 million yen (-% year on year) and segment profit was 639 million yen (down 14.2% year on year). Net sales decreased by 815 million yen due to the application of the Accounting Standard for Revenue Recognition, etc.

2) Electronics materials

Sales of semiconductor materials remained robust because of consistently strong sales of raw materials used to manufacture ArF photoresist, the primary product of this segment. The display materials delivered a weak sales performance due to a reactionary fall in demands for displays used in teleworking, remote learning and other activities. As a result, net sales stood at 11,335 million yen (-% year on year) and segment profit was 2,850 million yen (up 18.5% year on year). Net sales decreased by 280 million yen due to the application of the Accounting Standard for Revenue Recognition, etc.

3) Specialty chemicals

As to raw materials for cosmetics, the acrylic resin for hair care products, which is a business we acquired from Mitsubishi Chemical Corporation last year, recorded strong sales abroad. As for functional materials, growth in sales of products made for other companies remained leveled off. High-purity specialty solvents produced by a subsidiary recorded robust sales. As a result, net sales were 4,476 million yen (-% year on year) and segment profit was 1,023 million yen (down 5.0% year on year). Net sales decreased by 2,859 million yen due to the application of the Accounting Standard for Revenue Recognition, etc.

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OSAKA ORGANIC CHEMICAL INDUSTRY LTD. (4187) Financial Results for the Third Quarter of FY11/22

(2) Explanation of Financial Position

Total assets as of the end of the nine-month period under review stood at 52,998 million yen, an increase of 3,130 million yen from the end of the previous consolidated fiscal year. This was mainly attributable to a decrease of 1,024 million yen in cash and deposits, an increase of 710 million yen in notes, accounts receivable-trade and contract assets (presented as "notes and accounts receivable-trade" at the end of the previous consolidated fiscal year), an increase of 754 million yen in raw materials and supplies, and an increase of 2,709 million yen in property, plant and equipment.

Total liabilities as of the end of the nine-month period under review were 13,064 million yen, an increase of 2,321 million yen from the end of the previous consolidated fiscal year. This was mainly attributable to an increase of 716 million yen in notes and accounts payable-trade, an increase of 1,000 million yen in current portion of long-term borrowings, an increase of 1,389 million yen in accounts payable-other, a decrease of 1,068 million yen in income taxes payable, and an increase of 520 million yen in long-term borrowings.

Total net assets as of the end of the nine-month period under review were 39,933 million yen, increasing 808 million yen from the end of the previous consolidated fiscal year. This was mainly attributable to increases of 2,548 million yen in retained earnings and 1,690 million yen in treasury shares.

1. Explanation of Consolidated Forecast and Other Forward-looking Statements The consolidated forecasts announced on January 12, 2022 remain unchanged.

Regarding the impact of the spread of the COVID-19 pandemic on operations, we will continue to carefully monitor the business environment and business performance. An announcement will be made promptly when it is determined that a forecast revision is required.

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