Shin Etsu Chemical : 連結(1.9 MB)

Press Release

Consolidated Financial Results for the First Three Quarters Ended December 31, 2022

Shin-Etsu Chemical Co., Ltd.	(JP GAAP)
	January 26, 2023

Listing Code: No. 4063 (URL: https://www.shinetsu.co.jp/en/)

Listing Stock Exchange: Tokyo and Nagoya

Representative: Yasuhiko Saitoh (Mr.) Representative Director/President

Personnel to contact: Toshiyuki Kasahara (Mr.) Corporate Officer, General Manager of Finance & Accounting Department Tel: [phone]

Date of the filing of the quarterly consolidated financial statements: February 13, 2023

Date of dividend payment: -

Preparation of supplemental explanatory materials: Yes ("Appendix" is attached.)

Holding of quarterly financial results meeting: Yes (for investment analysts and institutional investors)

Amounts are stated in millions of yen by discarding fractional amounts less than 1 million. Percentage figures indicate increase (decrease) over previous corresponding period.

1. Consolidated Operating Performance for the First Three Quarters Ended December 31, 2022

(From April 1, 2022 to December 31, 2022)

(1) Results of consolidated operations

	Net sales	Operating income	Ordinary income
April - December 2022	2,163,237	45.8%	808,227	68.3%	824,217	68.1%
April - December 2021	1,483,703	36.1%	480,112	68.4%	490,304	67.3%
(Note) Comprehensive income (Millions of yen)	From April 1, 2022 to December 31, 2022:
			From April 1, 2021 to December 31, 2021:

(Millions of yen)

Net income attributable

to owners of parent

578,519	63.8%
353,135	65.5%

1,051,463 [123.9%]

469,524 [145.8%]

	Net income	Diluted net income
	per share (yen)	per share (yen)
April - December 2022	1,416.49	1,415.68
April - December 2021	850.00	849.18

(2) Consolidated financial position								(Millions of yen)
		Total assets	Net assets		Stockholders'	Net assets per share
			equity ratio		(yen)
December 31, 2022	4,771,523	4,086,676		82.5%		9,749.12
March 31, 2022	4,053,412	3,429,208		82.1%		8,007.24
(Note) Stockholders' equity (Millions of yen) As of December 31, 2022: 3,935,368 As of March 31, 2022: 3,326,564
2. Cash Dividends
				Cash dividends per share in the fiscal year (yen)
			1st quarter	2nd quarter	3rd quarter	Year-end	Fiscal year
April 2021 - March 2022		-	150.00		-		250.00		400.00
April 2022 - March 2023		-	225.00		-
April 2022 - March 2023 (forecast)							275.00		500.00
(Note) Revision of the latest forecast of cash dividends: Yes
3. Forecast of Consolidated Operating Performance for the Fiscal Year Ending March 31, 2023
(From April 1, 2022 to March 31, 2023)							(Millions of yen)
									Net income	Net income
	Net sales	Operating income	Ordinary income		attributable to	per share
								owners of parent	(yen)
Fiscal year	2,780,000	34.0%	995,000	47.1%	1,020,000	46.9%	708,000	41.6%	1,738.83
(Note) Revision of the latest forecast of consolidated operating performance: Yes

Forward-looking statements such as the forecast of results of operations made in this document involves risks and uncertainties since they are based on management's assumptions and beliefs in light of the information currently available to it. The reader should be aware that actual results may be materially different from any future results expressed herein due to various factors. Material factors affecting the actual results may include overall economic conditions in which the businesses of our company and our group companies are involved, the relevant market trends and fluctuations in foreign exchange rates of the yen, in particular, the exchange rate between the U.S. dollar and the yen; provided, however, that such factors as may affect results of operations are not limited to those enumerated above.

(Notes)

1. Changes in significant subsidiaries during the first three quarters ended December 31, 2022: No

(Note) This item indicates whether there were changes in significant subsidiaries affecting the scope of consolidation during the first three quarters ended December 31, 2022.

1. Adoption of special accounting methods for presenting quarterly consolidated financial statements: No
2. Changes in accounting policies applied, changes in accounting estimates and retrospective restatement

Changes in accounting policies applied due to revisions of accounting standards: Yes

Changes in accounting policies other than the above: No

Changes in accounting estimates: No

Retrospective restatement: No

(Note) Please see [2. Consolidated Financial Statements (3) Notes to Consolidated Financial Statements, "Changes in Accounting Policies"] on page 13 for further details.

(4) Number of shares outstanding (common stock)

Number of shares outstanding at period end

Number of shares of treasury stock at period end

Weighted-average number of shares outstanding over period

December 31, 2022	March 31, 2022
410,945,593	416,662,793
7,281,564	1,218,008
April - December	April - December
2022	2021
408,415,611	415,454,846

(Note) Based on a resolution at the Board of Directors Meeting held on April 27, 2022, we repurchased a maximum of 5,717,200 shares (99,998 million yen) and the cancellation was completed on November 8, 2022.

Moreover, based on a resolution at the Board of Directors Meeting held on July 27, 2022, we repurchased a maximum of 6,121,000 shares (99,998 million yen) and the cancellation was completed on January 11, 2023.

(Information regarding quarterly review procedures)

The financial information contained in this report is not subject to quarterly review procedures by independent auditors.

Shin-Etsu Chemical Co., Ltd. (4063)

First Three Quarters Ended December 31, 2022

(Attached Documents)

	INDEX
1. Qualitative Information Regarding Quarterly Results	2
(1)	Explanation Regarding the Operating Results	2
(2)	Explanation Regarding Information Relevant to Forecasts such as Consolidated Business
	Forecast	8
2. Consolidated Financial Statements	9
(1)	Consolidated Balance Sheets	9
(2)	Consolidated Statements of Income and Statements of Comprehensive Income	11
(3)	Notes to Consolidated Financial Statements	13
(Notes on Premise of Going Concern)	13
(Notes on Significant Changes in Stockholders' Equity)	13
(Changes in Accounting Policies)	13
(Major Subsequent Events)	13

(Appendix)
1.	Quarterly Operating Results	14
2.	Capital Expenditures and Depreciation and Amortization	15
3.	Other Financial Items (Consolidated)	16
4.	Comparative Balance Sheets (Consolidated)	16
5.	Comparative Statements of Cash Flows (Consolidated)	17
6.	Cash Dividends per Share	17
7.	Sales by Manufacturing Location for Each Segment	18
8.	Sales by Region	18
9.	Average Exchange Rate	18

1

Shin-Etsu Chemical Co., Ltd. (4063)

First Three Quarters Ended December 31, 2022

1. Qualitative Information Regarding the Quarterly Results

(1) Explanation Regarding the Operating Results

During the first nine months of the fiscal year ending March 31, 2023 (April 1, 2022, to December 31, 2022), it is noteworthy that the International Monetary Fund revised its economic growth forecasts downward multiple times, resulting in many surprises defying any expectation, described by some as "the first phenomenon to be observed in decades." While monetary policies aimed at calming inflation are putting downward pressure on the economy, a variety of changes are causing turbulence in the global economy. In addition, industrial policies are proceeding apace aimed at carbon neutrality, economic security, and other goals. Under these circumstances, we will maintain close communication with our customers, expedite the development of products that are valuable to them, and continue to provide a reliable supply of products of unwavering quality. We will skillfully weather short-term fluctuations and will continue capital investments and R&D activities so as to meet the needs and demands of customers and markets in a timely manner.

The business results for the first nine months of the fiscal year ending March 31, 2023, are as follows.

					(Billions of yen)
		2022		Increase			2022
	2021
	Apr - Dec		Apr - Dec		(Decrease)		Apr - Jun	Jul - Sep	Oct - Dec
Net sales	1,483.7	2,163.2	45.8%	656.7	752.6	753.9
	679.5
Operating income	480.1	808.2	68.3%	249.6	286.6	271.9
	328.1
Ordinary income	490.3	824.2	68.1%	262.6	296.3	265.1
	333.9
Net income attributable	353.1		578.5	63.8%	184.1	208.2	186.1
to owners of parent		225.4
ROIC (per annum)	25.9%	35.5%		9.6 points
ROE (per annum)	15.8%	21.2%		5.4 points
ROA (per annum)	18.3%	24.9%		6.6 points
Net income per share(Yen)	850	1,416	566
Notes: ・ ROIC: Return on invested capital
Net operating income after tax / (Net assets + Interest-bearing liabilities－Cash)

• ROE: Return (Net Income) on equity

Equity used for this calculation is net assets excluding both share subscription rights andnon-controlling interests in consolidatedsubsidiaries.

• • ROA: Return (Ordinary Income) on total assets.
  • ROIC, ROE and ROA (per annum) are calculated by multiplying net operating income after tax, net income and ordinary income for the first three quarters by four over three, respectively.
• Amounts are stated in billions of yen by discarding fractional amounts less than 0.1 billion on this summary.

2

Shin-Etsu Chemical Co., Ltd. (4063)

First Three Quarters Ended December 31, 2022

Net Sales and Operating Income by Segment

(Billions of yen)

			Net Sales
	2021	2022		Increase
	Apr - Dec Apr - Dec (Decrease)
Infrastructure	595.8		1,008.8		69.3%
Materials		413.0
Electronics	516.8	672.5		30.1%
Materials		155.7
Functional	289.1	384.1		32.8%
Materials		95.0
Processing &	81.8	97.7		19.4%
Specialized Services		15.9
Total	1,483.7	2,163.2		45.8%
					679.5

Operating Income

2021	2022	Increase
Apr - Dec	Apr - Dec	(Decrease)

2.1 times

212.3 439.4 227.1

183.8	243.3	32.3%
				59.5
68.3	106.1	55.4%
				37.8
16.3	20.9	27.8%
			4.6
480.1	808.2	68.3%
			328.1

Processing &	Processing &
Specialized Services
Specialized Services
3%
5%

Functional

Materials

18%

Electronics

Materials

31%

Net

Sales

2,163.2

Billions of yen

Functional

Materials

13%

Infrastructure

Materials

46%

Electronics

Materials

30%

Operating

Income

808.2

Billions of yen

Infrastructure

Materials

54%

3