Shin Etsu Chemical : Consolidated

Press Release

Consolidated Financial Results for the Fiscal Year Ended March 31, 2021

Shin-Etsu Chemical Co., Ltd.	(JP GAAP)
	April 28, 2021

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.) Director, General Manager of Finance & Accounting Department

Tel: [phone]
Date of the annual shareholders' meeting	……	June 29, 2021
Date of the filing of the consolidated financial statements	……	June 30, 2021
Date of year-end dividend payment	……	June 30, 2021

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

Holding of 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 fiscal year.

1. Consolidated Operating Performance for the Fiscal Year Ended March 31, 2021

(From April 1, 2020 to March 31, 2021)

(1) Results of consolidated operations																										(Millions of yen)
		Net sales								Operating income				Ordinary income		Net income attributable to
																owners of parent
April 2020 - March 2021	1,496,906		(3.0%)			392,213	(3.4%)			405,101	(3.1%)			293,732	(6.5%)
April 2019 - March 2020	1,543,525		(3.2%)			406,041	0.6%				418,242		0.7%			314,027	1.6%
(Note) Comprehensive income (Millions of yen) April 2020 - March 2021: 262,230 [(8.6%) ]
								April 2019 - March 2020: 286,889 [ 2.5% ]
	Net income			Diluted net		Ratio of net income		Ratio of ordinary				Ratio of
	per share			income per		to stockholders'			income to total			operating income
	(yen)			share (yen)			equity						assets				to net sales
April 2020 - March 2021	706.76				706.26					10.7%					12.3%							26.2%
April 2019 - March 2020	755.17				755.01					12.3%					13.3%							26.3%
(Note) Equity in earnings	(losses) of affiliates (Millions of yen) April 2020 - March 2021: 5,364
(2) Consolidated financial position										April 2019 - March 2020: 4,327							(Millions of yen)
	Total assets								Net assets					Stockholders'		Net assets per share
													equity ratio								(yen)
March 31, 2021		3,380,615						2,886,625						83.2%							6,769.72
March 31, 2020		3,230,485						2,723,141						82.1%							6,377.93
(Note) Stockholders' equity	(Millions of yen)			As of	March 31, 2021: 2,813,137				As of March 31, 2020: 2,652,309
(3) Consolidated cash flows																													(Millions of yen)
	Cash flows from					Cash flows from			Cash flows from							Cash and cash
									equivalents at the end of
	operating activities		investing activities		financing activities
									fiscal year
April 2020 - March 2021		401,176									(250,719)						(91,123)										801,596
April 2019 - March 2020		412,384									(394,547)						(94,055)										745,125
2. Cash Dividends
			Cash dividends per share			Total annual cash		Dividend		Ratio of
			for the fiscal year (yen)
						dividend paid			payout			dividend payout
	1st		2nd				3rd			Year-	Fiscal
							(Millions of yen)			ratio				to net assets
	quarter		quarter			quarter			end	year
April 2019 - March 2020	-		110.00			-					110.00	220.00					91,473		29.1%				3.6%
April 2020 - March 2021	-		110.00			-					140.00	250.00					103,853		35.4%				3.8%

3. Forecast of Consolidated Operating Performance for the Fiscal Year Ending March 31, 2022

(From April 1, 2021 to March 31, 2022)

We will promptly make an announcement of the consolidated business and cash dividends forecast as soon as the disclosure of the forecast becomes possible.

(Notes)

(1) Changes in significant subsidiaries which affected the scope of consolidation during the current fiscal year: No

(2) Changes of accounting policies applied, changes in accounting estimates and retrospective restatement

Changes of accounting policies applied due to revisions of accounting standards: No

Changes of accounting policies other than the above: No

Changes in accounting estimates: No

Retrospective restatement: No

(3) Number of shares outstanding (common stock)	March 31, 2021		March 31, 2020
Number of shares outstanding at the year end	416,662,793	416,662,793
Number of shares of treasury stock at the year end	1,115,572	805,396
Weighted-average number of shares	April 2020 - March 2021		April 2019 - March 2020
415,602,349	415,838,457
outstanding over the year

(Reference) Summary of Non-consolidated Financial Results

Non-consolidated Operating Performance for the Fiscal Year Ended March 31, 2021

(From April 1, 2020 to March 31, 2021)
(1) Results of non-consolidated operations						(Millions of yen)
	Net sales			Operating income	Ordinary income	Net income
April 2020 - March 2021	829,065	(1.9%)	137,341	(7.0%)		160,800	(3.9%)	118,910	(9.8%)
April 2019 - March 2020	845,356		2.8%	147,639	13.6%		167,412	24.2%	131,836	35.4%
	Net income per share	Diluted net income
	(yen)			per share (yen)
April 2020 - March 2021	286.12			285.92
April 2019 - March 2020	317.04			316.98
(2) Non-consolidated financial position								(Millions of yen)
	Total assets		Net assets		Stockholders' equity	Net assets per share
			ratio		(yen)
March 31, 2021	1,199,772		856,040			71.2%		2,055.94
March 31, 2020	1,156,255		821,894			70.9%		1,972.36
(Note) Stockholders' equity	(Millions of yen)	As of	March 31, 2021: 854,340		As of March 31, 2020: 820,220
Stockholders' equity used for the calculation of indices is net assets excluding share subscription rights.

(Information regarding audit procedures)

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

	Shin-Etsu Chemical Co., Ltd. (4063)
	Fiscal Year Ended March 31, 2021
(Attached Documents)
	INDEX
1. Results of Operations and Financial Overview .....................................................................................	2
(1) Results of Operations and Financial Position Overview..................................................................	2
(2) Business Prospects .........................................................................................................................	12
(3) Management Policies.......................................................................................................................	12
2. Basic Approach to the Selection of Accounting Standards .................................................................	13
3. Consolidated Financial Statements......................................................................................................	14
(1) Consolidated Balance Sheets .........................................................................................................	14
(2) Consolidated Statements of Income and Statements of Comprehensive Income ..........................	16
(3) Consolidated Statements of Changes in Net Assets.......................................................................	18
(4) Consolidated Statements of Cash Flows ........................................................................................	20
(5) Notes to Consolidated Financial Statements..................................................................................	21
	(Notes on Premise of Going Concern)........................................................................................	21
	(Segment Information)................................................................................................................	21
	(Per Share Information) ..............................................................................................................	23
	(Major Subsequent Events).........................................................................................................	23
(Appendix)
1.	Quarterly Operating Results .........................................................................................................	24
2.	Capital Expenditures and Depreciation and Amortization ...........................................................	25
3.	Operating Performance of Shintech Inc........................................................................................	25
4.	Other Financial Items (Consolidated) ...........................................................................................	26
5.	Comparative Balance Sheets (Consolidated) ................................................................................	26
6.	Cash Dividends per Share ............................................................................................................	27
7.	Sales by Region ............................................................................................................................	27
8.	Assets by Segments ......................................................................................................................	28
9.	Average Exchange Rate ...............................................................................................................	28
10. Topics ...........................................................................................................................................	29
11. Capital Investments ......................................................................................................................	29

1

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

Fiscal Year Ended March 31, 2021

1. Results of Operations and Financial Overview

(1) Results of Operations and Financial Position Overview

1) General Overview

During the fiscal year ended March 31, 2021 (April 1, 2020 to March 31, 2021), demand recovered to varying degrees depending on the region and industry, after a downturn caused by worldwide restrictions on economic activities in the April to June quarter. Demand and market conditions recovered in our major business fields in the October to December quarter. Since then, demand and market conditions have generally improved. In March 2021, the U.S. government enacted the Covid 19 Economic Stimulus Package amounting to US$ 1.9 trillion and the U.S. Federal Reserve confirmed that it would continue monetary easing toward full employment. Meanwhile, the Chinese government decided to renew its five-year plan and take flexible measures for economic growth. The Shin-Etsu Group focused on business requirements such as maintaining high operating rates, ensuring a stable product supply, and preserving receivables, while giving top priority to the health and safety of our employees. Communicating closely with our customers, we promoted the development of products that are of value to our customers, and provided a stable supply of products of unwavering quality. In addition, we carried out the capital investment projects as scheduled.

As a result, the business results for the fiscal year ended March 31, 2021 are as follows.

						(Billions of yen)
			Fiscal year	Fiscal year	Increase			Quarterly
			19/4 - 20/3	20/4 - 21/3		(Decrease)		Apr-Jun	Jul-Sep	Oct-Dec	Jan-Mar
		Net sales	1,543.5	1,496.9		(3.0%)			359.3	351.1	379.8	406.4
				(46.6)
		Operating income	406.0	392.2		(3.4%)			90.9	93.3	100.7	107.1
				(13.8)
		Ordinary income	418.2	405.1		(3.1%)			95.2	97.0	100.8	112.0
				(13.1)
		Net income attributable	314.0	293.7		(6.5%)			69.3	70.9	73.0	80.4
		to owners of parent		(20.3)
		ROIC	19.4%	17.2%		( 2.2points)
		ROE	12.3%	10.7%		( 1.6points)
		ROA	13.3%	12.3%		( 1.0points)
		Per Share (Yen)
		Net income	755	707		(48)
		Cash dividends	220	(Forecast) 250		30

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 and non-controlling interests in consolidated subsidiaries.

• • ROA: Return (Ordinary income) on total assets.
• 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)

Fiscal Year Ended March 31, 2021

2) Business Segment Overview

Net sales and Operating income by Segment

(Billions of yen)

						Net sales		Operating income
			Fiscal year		Fiscal year	Increase	Fiscal year	Fiscal year		Increase
			19/4 - 20/3	20/4 - 21/3	(Decrease)	19/4 - 20/3	20/4 - 21/3	(Decrease)
PVC/Chlor-Alkali Business	484.3		469.7	(3.0%)	92.1	97.0	5.3%
							(14.6)			4.9
Silicones Business		226.8		208.3	(8.2%)	61.4	45.1	(26.6%)
							(18.5)			(16.3)
Specialty Chemicals Business	114.7		112.6	(1.9%)	27.7	21.8	(21.3%)
							(2.1)			(5.9)
Semiconductor Silicon	387.6		374.0	(3.5%)	143.2	144.1	0.6%
Business			(13.6)	0.9
Electronics & Functional	225.1		234.8	4.3%	68.5	70.2	2.6%
Materials Business		9.7	1.7
Processing, Trading &	104.7		97.2	(7.2%)	14.8	14.3	(3.1%)
Specialized Services Business		(7.5)	(0.5)
Total		1,543.5		1,496.9	(3.0%)	406.0	392.2	(3.4%)
							(46.6)			(13.8)
Processing, Trading &						Processing, Trading &
Specialized Services						Specialized Services
		6%						3%
Electronics &						Electronics &
					Functional				PVC/
Functional
		PVC/	Materials			Chlor-Alkali
Materials
		18%			25%
16%				Chlor-Alkali
	Net
			31%		Operating
		sales						income
		1,496.9						392.2		Silicones
Semiconductor		Billions of yen					Billions of yen
								11%
Silicon						Semiconductor
25%			Silicones		Silicon
				37%
			14%				Specialty
		Specialty
								Chemicals
		Chemicals							6%
		8%

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