Osaka Soda : CONSOLIDATED FINANCIAL RESULTS For the Third Quarter of the Fiscal Year ending March 31, 2022

(Reference Translation)

February 8, 2022

Osaka Soda Co., Ltd.

CONSOLIDATED FINANCIAL RESULTS

For the Third Quarter of the Fiscal Year ending March 31, 2022

(Prepared under Japan GAAP, unaudited)

Company name:	Osaka Soda Co., Ltd.	Stock Exchange Listing:	Tokyo
Securities code:	4046	URL:	http://www.osaka-soda.co.jp
Representative:	Kenshi Terada, Representative Director, President & Chief Operating Officer
For inquiry:	Toru Imamura, General Manager, Administration Division
	(Telephone: [phone])

Filing date for quarterly report:	February 9, 2022
Commencement date of dividend payment:	－
Supplementary materials for the quarterly financial results: None
Quarterly financial results briefings:	None
1. Consolidated Financial Results	(Amounts are rounded down to the nearest million yen)
(1) Results of Operations
			Nine Months Ended
	December 31, 2021		December 31, 2020
	Millions of yen		Change *		Millions of yen	Change *
Net sales	65,320		- %		72,327	(9.6) %
Operating income	9,840		56.6%		6,284	(15.3) %
Ordinary income	10,627		63.5%		6,500	(17.5) %
Net income attributable to owners of parent	7,550		73.4%		4,355	(11.9) %
Comprehensive income	6,144		(16.1) %		7,320	34.3 %

Note: Percent changes for nine months are year-on-year comparisons.

Net income per share (Yen)	323.65	184.81
Diluted net income per share (Yen)	290.71	165.04

Note: Osaka Soda Group has adopted "Accounting Standard for Revenue Recognition" (ASBJ Statement No.29) from the beginning of quarterly period ended June 30, 2021. The figures for the nine months ended December 31, 2021 reflect this change of accounting standard and year-on-year percent changes for nine months are not available.

(2) Financial Condition
	December 31, 2021	March 31, 2021
	Millions of yen	Ratio	Millions of yen	Ratio
Total assets	128,088	－	119,373	－
Net assets	81,830	－	77,232	－
Equity attributable to owners of the parent*	81,807	－	77,224	－
Equity ratio	－	63.9%	－	64.7%

Note: Equity = "Total net assets" minus "Non-controlling interests"

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2. Dividends

	Year ending Mar. 31, 2022	Year ending Mar. 31, 2022	Year ended Mar. 31, 2021
	(Forecast)
End of first quarter			－		－
End of second quarter			35.00 yen*	32.50	yen
End of third quarter			－		－
End of fourth quarter	35.0	yen	－	32.50	yen
Full year	70.0	yen	－	65.00	yen

Note: Changes from the most recently published forecast of dividends: None

3. Earnings Forecast for the fiscal year ending March 31, 2022 Full-year

		Millions of yen	Change*
Net sales	82,000	- %
Operating income	10,700	28.3%
Ordinary income	11,400	29.0%
Net income attributable to owners of parent	8,000	32.2%
Note: Revisions of earnings forecast from the latest announcement: None
Earnings per share (Yen)		342.95

Note 1: Changes from the most recently published forecast of financial results: None

Note 2: Osaka Soda Group has adopted "Accounting Standard for Revenue Recognition" (ASBJ Statement No.29) from the beginning of fiscal year ending March 31, 2022. The earnings forecast for the fiscal year ending March 31, 2022 reflect this change of accounting standard and year-on-year percent changes are not available.

* Notes

1. Changes in significant subsidiaries during the period (Changes in specified subsidiaries resulting in the change in scope of consolidation): None
2. Application of accounting methods used specifically for the preparation of quarterly consolidated financial statements: None
3. Changes in accounting policies, accounting estimates and restatements of prior period financial statements

1. Changes in accounting policies due to revisions of accounting standards, etc.: Yes
2. Changes in accounting policies other than 1: None
3. Changes in accounting estimates: None
4. Restatement of prior period financial statements: None

1. Number of outstanding shares (common stock)

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

As of December 31, 2021:	26,732,017	shares
As of March 31, 2021:	26,731,415	shares

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2)	Number of treasury shares at the end of the period
	As of December 31, 2021:	3,400,107	shares
	As of March 31, 2021:	3,404,604	shares
3)	Average number of shares outstanding during the period
	Nine months ended December 31, 2021:	23,329,382	shares
	Nine months ended December 31, 2020:	23,565,292	shares

* Quarterly Review Procedures

The quarterly financial results are exempt from the quarterly review procedures by certified public accountants or audit firm.

*Financial Forecasts and Other Notes

This material contains forward-looking statements such as earnings forecast about Osaka Soda Co., Ltd. and its group companies ("Osaka Soda Group"). These forward-looking statements are based on the current assumptions and beliefs of Osaka Soda Group in light of the information currently available to it, and contain known and unknown risks, uncertainties and other factors. Osaka Soda Group therefore wishes to caution readers that actual results could be materially different from any future results.

DISCLAIMER:

This is an English translation of the original Japanese document and is prepared for reference. Should there be any inconsistency between the translation and the Japanese original, the latter shall prevail. This translation is subject to change without notice. Osaka Soda Co., Ltd. and/or its group companies shall individually or jointly accept no responsibility or liability for damage or loss caused by any error, inaccuracy, misunderstanding, or changes with regard to this translation.

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4. QUALITATIVE INFORMATION

1. Results of Operations

During the third quarter of fiscal 2021 (April 1 through December 31, 2021), the Japanese economy is showing signs of picking up although it has remained in a severe situation due to the novel coronavirus (COVID-19) pandemic. The economy is expected to continue its recovery trend. However, the economic outlook remains uncertain because of a new variant of the coronavirus and supply-side constraints, and the downside risks such as raw material price fluctuations.

Under the circumstances, Osaka Soda Group launched the Medium-Term Management Plan "Empower the Next - 22", and implemented concrete measures based on four basic policies, "Building a resilient business foundation", "Promotion of market-in-type development", "Efforts to achieve the SDGs", and "Reforming corporate culture and organizational culture".

With regard to "Building a resilient business foundation", the following business domains such as Chemicals business, Functional Materials business , and Healthcare business are positioned as core businesses and resilient strategy is pursued. In Chemicals business, we have established a stable supply system as originally planned, with the commencement of operations at our Kitakyushu Plant, which was formed as a result of the integration of electrolysis facilities at the Fukuoka Plant of Mitsubishi Chemical Corporation and our Kokura Plant. Functional Materials business responded to growing global demand in Allyl Ethers with expansion of the supply system and improvement of productivity. Health Care business continued to grow at a strong pace due to the increase of customer acceptance for new grades in Chromatography and to the increase of new orders for Pharmaceutical API and Intermediates. Pursuing cost reduction at production sites is connected to contribution to earnings constantly.

With regard to "Promotion of market-in-type development", we succeeded in developing a semi-solid battery using our special polyether in collaboration with Yamagata University. In the future, we will build a supply system for special polyether to begin mass production of semi-solid batteries.

As a result, net sales were ¥65,320 million, a decrease of 9.7% compared to the same period of fiscal 2020. Net sales declined 18,708 million yen caused by the adoption of revenue recognition standard, but the reality is that net sales increased. Operating income was ¥9,840 million, an increase of 56.6% compared to the same period of fiscal 2020. Ordinary income was ¥10,627 million, an increase of 63.5% compared to the same period of fiscal 2020. Net income attributable to owners of the parent was ¥7,550 million, an increase of 73.4% compared to the same period of fiscal 2020. All incomes during the nine months ended December 31, 2021 reached record highs.

The following is a summary of reporting segments.

Basic Chemical Products

In Chlor-Alkali, net sales increased, especially in caustic soda, due to the demand recovery out of coronavirus collapse.

In Epichlorohydrin, net sales increased due to the demand recovery mainly in electrical materials. Overseas market conditions remained high against the background of tight supply-demand balance.

As a result, Basic Chemical Products reported net sales of ¥27,514 million, down 11.4% compared to the same period of fiscal 2020, due to the adoption of Accounting Standard for Revenue Recognition.

Functional Chemical Products

In Synthetic Rubber related products, Epichlorohydrin Rubber, net sales increased due to the increase in global demand for automobiles and office automation. Acrylic Rubber, net sales increased due to an

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expansion of customer acceptance in domestic and overseas, especially in Asian market.

In Diallyl Phthalate Resin, net sales increased due to the growth of electric materials caused by domestic demand and the constant growth in exported sales to Asian countries including China and the United States. In Allyl Ethers, net sales increased due to sales expansion of silane coupling agents in domestic and overseas. In Separation Media in Pharmaceutical Industry (Silica Gel for Liquid Chromatography), net sales increased due to demand expansion for diabetes drug use to Europe, the United States and Asian countries.

In Active Pharmaceutical Ingredients (API) and their Intermediates, net sales increased due to sales expansion of anti-tuberculosisdrug intermediate, insomnia treatment intermediates, and anti-cancerdrug substance and intermediate,

As a result, Functional Chemical Products reported net sales of ¥33,538 million, up 10.2% compared to the same period of fiscal 2020.

Housing Facilities and Others

Net sales were ¥4,266 million, down 60.6% compared to the same period of fiscal 2020, due to the adoption of Accounting Standard for Revenue Recognition.

1. Financial Condition Assets

Current assets were ¥81,035 million, an increase of 9.7% since March 31, 2021. The increase was due primarily to an increase of ¥2,580 million in cash and deposits and an increase of ¥2,346 million in notes and accounts receivable-trade respectively.

Noncurrent assets were ¥47,052 million, an increase of 3.4% since March 31, 2021. The increase was due primarily to an increase of ¥3,271 million in property, plant and equipment and a decrease of ¥1,547 million in investments and other assets.

As a result, Total assets were ¥128,088 million as of December 31, 2021, an increase of 7.3% since March 31, 2021.

Liabilities

Current liabilities were ¥40,472 million, an increase of 50.9% since March 31, 2021. The decrease was due primarily to an increase of ¥1,824 million in notes and accounts payable-trade and an increase of ¥8,735 million in current portion of bonds with subscription rights to shares respectively.

Noncurrent liabilities were ¥5,785 million, a decrease of 62.2% since March 31, 2021. The decrease was due primarily to a decrease of ¥8,737 million in bonds with subscription rights to shares and a decrease of ¥751 million in deferred tax liabilities respectively.

As a result, Total liabilities were ¥46,258 million as of December 31, 2021, an increase of 9.8% since March 31, 2021.

Net assets

Net assets were ¥81,830 million as of December 31, 2021, an increase of 6.0% since March 31, 2021.

(3) Earnings Forecast

There are no revisions to the earnings forecast from the previous forecast announced in the "Consolidated financial results for the quarterly period ending March 31, 2022, unaudited" on October 19, 2021. In the future, we will appropriately disclose any changes that may have been made.

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