Notice Regarding Recording of Extraordinary Loss (Impairment Loss), Revision of Consolidated Earnings Guidance, and Revision of Dividend Forecast (Increase)

Overview of Recording Extraordinary Loss and Revision of Earnings Guidance

Sakai Chemical Industry Co., Ltd. recorded an impairment loss of 2,418 million yen on fixed assets in the Cosmetics Materials segment as an extraordinary loss during the consolidated accounting period for Q3 of the fiscal year ending March 2026. The main cause is the revision of earnings forecasts due to the slowdown in the Chinese economy and other factors. Accordingly, the full-year forecast for net income attributable to owners of the parent for the fiscal year ending March 2026 has been downwardly revised from 5,500 million yen to 3,000 million yen, a reduction of 2,500 million yen (45.5%). Meanwhile, net sales, operating income, and ordinary income remain unchanged from the previous forecasts at 86,000 million yen, 6,500 million yen, and 6,500 million yen respectively.

Revision of Dividend Forecast and Future Outlook

Based on the medium-term management plan 'Transformation BEYOND 2030,' the company aims for stable and continuous dividends targeting a DOE of 3%. Despite recording the impairment loss, considering strong performance in other segments, the year-end dividend forecast for the fiscal year ending March 2026 has been revised upward from 65.00 yen to 80.00 yen, and the total annual dividend forecast has been increased from 130.00 yen to 145.00 yen. The company also notes that future earnings outlooks are based on reasonable assumptions but may fluctuate due to various factors.