Supplementary Financial Explanation Materials for the Fiscal Year Ending December 2025

Overview of Performance

For the fiscal year ending December 2025, consolidated net sales reached JPY 70,705 million (YoY +1.7%) and operating income was JPY 10,869 million (YoY +11.6%). In the chemicals segment, increased sales of fine chemicals performed well, driving growth in both revenue and profit. On the other hand, the building materials segment saw declines in both revenue and profit due to sluggish demand in the detached housing market and extended construction periods. Ordinary income increased to JPY 11,921 million (YoY +10.6%), but net income attributable to owners of the parent decreased to JPY 8,459 million (YoY -4.0%). ROE was 9.5%, down 0.9 points year-over-year.

Segment Trends and Future Outlook

The fine chemicals segment, including functional materials and electronic chemical materials, showed increases in both sales and profit, with the rise in AI-related demand for Glicap significantly contributing. Although the building materials segment saw net sales decline due to decreased volume, quarter-over-quarter revenue trends showed growth. For the full fiscal year ending December 2026, the company forecasts net sales of JPY 800 billion (YoY +13.1%) and operating income of JPY 14.4 billion (YoY +32.5%), expecting strong sales growth in fine chemicals and the positive effects of price increases in the building materials segment. The dividend payout ratio target is set at 30%, with a total shareholder return ratio goal of 50%, reflecting a proactive shareholder return policy.