DIC CORPORATION ENGLISH TRANSLATION OF JAPANESE-LANGUAGE DOCUMENT
This is a translation of the original Japanese-language document and is provided for convenience only. In all cases, the Japanese-language original shall take precedence.
Consolidated Financial Results for the Six Months Ended June 30, 2023 (Japan GAAP) (The fiscal year ending December 31, 2023)
Company Name: DIC Corporation
August 9, 2023
Stock Exchange: Tokyo
Head Office: Tokyo
Tel: +81 (3) 6733-3000
Listing Code Number: 4631 | Scheduled Filing Date of Quarterly Securities Report: August 9, 2023 |
URL: https://www.dic-global.com/en/ | Dividend Payment: September 1, 2023 |
Representative: Kaoru Ino, Representative Director, President and CEO
Contact Person: Jun Kaneko, General Manager, Accounting Department
Preparation of Supplemental Explanatory Materials: Yes
Holding of Quarterly Financial Results Meeting: Yes (for security analysts and institutional investors, etc.)
(Yen amounts are rounded to the nearest million, except for per share information)
1. Consolidated Financial Results for the Six Months Ended June 30, 2023 (January 1, 2023 -June 30, 2023)
(1) Consolidated operating results | (Percentages indicate year-on-year changes) | |||||||
Net sales | Operating income | Ordinary income | Net income attributable to | |||||
owners of the parent | ||||||||
JPY (million) | % | JPY (million) | % | JPY (million) | % | JPY (million) | % | |
Six months ended June 30, 2023 | 515,311 | -1.2 | 9,962 | -58.4 | 7,143 | -72.7 | 997 | -93.1 |
Six months ended June 30, 2022 | 521,411 | 33.1 | 23,966 | -12.2 | 26,151 | -7.4 | 14,390 | -10.2 |
Note: Comprehensive income (JPY million): | Six months ended June 30, 2023 | 39,100 (-42.2%) | |||||||||||
Six months ended June 30, 2022 | 67,687 (74.9%) | ||||||||||||
Earnings per | Earnings per | ||||||||||||
share (basic) | share (diluted) | ||||||||||||
10.53 | JPY | JPY | |||||||||||
Six months ended June 30, 2023 | － | ||||||||||||
Six months ended June 30, 2022 | 152.03 | － | |||||||||||
(2) Consolidated financial position | |||||||||||||
Total assets | Net assets | Shareholders' equity ratio | |||||||||||
to total assets | |||||||||||||
JPY (million) | JPY (million) | % | |||||||||||
As of June 30, 2023 | 1,341,251 | 455,216 | 31.3 | ||||||||||
As of December 31, 2022 | 1,261,637 | 421,088 | 30.7 | ||||||||||
Reference: Shareholders' equity (JPY million): | As of June 30, 2023 | 420,126 As of December 31, 2022 386,997 | |||||||||||
2. Cash Dividends | |||||||||||||
Cash dividends per share | |||||||||||||
(Record date) | End of 1st quarter | End of 2nd quarter | End of 3rd quarter | Year-end | Annual | ||||||||
JPY | JPY | JPY | JPY | JPY | |||||||||
FY2022 | － | 50.00 | － | 50.00 | 100.00 | ||||||||
FY2023 | － | 50.00 | |||||||||||
FY2023 (Plan) | － | 30.00 | 80.00 |
Note: Revision of the forecasts for the dividends payment: Yes
For details, please refer to "Notice Regarding Differences between Forecasts and Actual Consolidated Operating Results for the Six Months Ended June 30, 2023, Revision of Consolidated Operating Results Forecasts for Fiscal Year 2023, Dividends from Surplus and Revision of the Year-End Cash Dividends Forecast" released on August 9, 2023.
3. Forecasts for Consolidated Operating Results for the Fiscal Year Ending December 31, 2023 (January 1, 2023 -December 31, 2023)
(Percentages indicate year-on-year changes)
Net income | Earnings per | ||||||||
Net sales | Operating income | Ordinary income | attributable to | ||||||
share (basic) | |||||||||
owners of the parent | |||||||||
JPY (million) | % | JPY (million) | % | JPY (million) | % | JPY (million) | % | JPY | |
FY2023 | 1,060,000 | 0.6 | 25,000 -37.0 | 20,000 -49.9 | 4,000 | -77.3 | 42.26 |
Note: Revision of the forecasts for the consolidated operating results for the fiscal year ending December 31, 2023: Yes
For details, please refer to "Analysis of Results of Operations (3) Operating Results Forecasts for Fiscal Year 2023" on page 4.
ENGLISH TRANSLATION OF JAPANESE-LANGUAGE DOCUMENT
This is a translation of the original Japanese-language document and is provided for convenience only. In all cases, the Japanese-language original shall take precedence.
Notes
-
Changes in the scope of consolidation for significant subsidiaries during the six months ended June 30, 2023: None (Changes in specified subsidiaries resulting in the change in scope of consolidation)
Newly included: － (Company name) －Excluded: －(Company name) － - Adoption of accounting methods which are exceptional for quarterly consolidated financial statements: Yes
- Changes in accounting policies and accounting estimates, and restatements
- Changes in accounting policies arising from revision of accounting standards: Yes
2) | Changes in accounting policies other than 1): | None |
3) | Changes in accounting estimates: | None |
4) | Restatements: | None |
- Number of shares issued (common stock)
- Number of shares issued at the end of the period, including treasury shares
As of June 30, 2023 | 95,156,904 shares, | As of December 31, 2022 | 95,156,904 shares | |
2) | Number of treasury shares at the end of the period | |||
As of June 30, 2023 | 496,487 shares, | As of December 31, 2022 | 504,123 shares | |
3) | Average number of shares issued during the period, excluding treasury shares | |||
For the six months ended June 30, 2023 | 94,659,868 shares, | For the six months ended June 30, 2022 | 94,654,474 shares |
- Since the fiscal year ended December 31, 2017, the Company has introduced the Board Benefit Trust (BBT). The shares held by the trust are included in the number of treasury shares.
Note: Quarterly consolidated financial results in this report are not subject to quarterly review procedures conducted by certified public accountants or audit firms.
Note: Explanation of the appropriate use of performance forecasts, and other special items
Caution concerning forward-looking statements
The above forecasts of future performance are based on information available to the Company at the present time and are subject to potential risks and uncertainty. Accordingly, the users should be aware that actual results may differ from any expressed future performance herein due to various factors.
For information regarding the assumptions used to prepare the forecasts, please refer to page 4.
ENGLISH TRANSLATION OF JAPANESE-LANGUAGE DOCUMENT
This is a translation of the original Japanese-language document and is provided for convenience only. In all cases, the Japanese-language original shall take precedence.
Analysis of Results of Operations
(1) Overview of Operating Results
(Billions of yen) | |||||
Six months ended | Six months ended | Change | Change (%) | ||
June 30, 2022 | June 30, 2023 | (%) | 〔Local currency basis〕 | ||
Net sales | 521.4 | 515.3 | -1.2% | -5.5% | |
Operating income | 24.0 | 10.0 | -58.4% | -58.3% | |
Ordinary income | 26.2 | 7.1 | -72.7% | － | |
Net income attributable to | 14.4 | 1.0 | -93.1% | － | |
owners of the parent | |||||
EBITDA * | 47.4 | 32.8 | -30.8% | － | |
¥/US$1.00 (Average rate) | 123.25 | 135.88 | 10.2% | － | |
¥/EUR1.00 (Average rate) | 134.89 | 146.91 | 8.9% | － | |
- EBITDA: Net income attributable to owners of the parent + Total income taxes + (Interest expenses -Interest income) + Depreciation and amortization + Amortization of goodwill
In the six months ended June 30, 2023, consolidated net sales edged down 1.2%, to ¥515.3 billion. Uncertainties persisted in the global economy, owing to such factors as the continued pursuit of inflation-curbing monetary policies in the United States and Europe, the protracted crisis in Ukraine and a delay in economic recovery in the People's Republic of China (PRC) following the lifting of stringent anti-COVID-19 measures, while concerns regarding interest rates and an economic slowdown inhibited demand and spurred efforts to curtail inventories in multiple industries. Against this backdrop, demand trends in core customer industries varied. In the area of digital materials, used principally in electrical and electronics equipment and in displays, demand picked up as the market for products for displays rallied, underpinned by the progress of inventory adjustments by display manufacturers. The semiconductor market overall remained weak as demand for finished products failed to rally. In industrial materials,* used primarily in mobility solutions, a recovery in vehicle sales was seen worldwide, but surplus inventories of materials for use in automobiles across the supply chain remained unresolved. Reflecting these trends, shipments of high-value-added products, notably those in the Functional Products segment, were down. In the Color & Display segment, pigments were impacted by slowing economic growth in Europe, a leading market for these products, as a result of which shipments of pigments for coatings and for plastics, among others, sagged.
Operating income fell 58.4%, to ¥10.0 billion. This sharp decrease was despite the progress of efforts in all segments to pass on higher costs by modifying sales prices and a gain in the Packaging & Graphic segment, and was due largely to sinking shipments of high-value-added products used in electrical and electronics equipment and in mobility solutions, and of pigments.
Ordinary income, at ¥7.1 billion, dropped 72.7%.
Net income attributable to owners of the parent plummeted 93.1%, to ¥1.0 billion.
Earnings before interest, taxes, depreciation and amortization (EBITDA) declined 30.8%, to ¥32.8 billion.
*DIC uses the term "industrial materials" to describe products for use in mobility solutions, namely, automobiles, railroads and shipping, and for general industrial applications such as construction equipment and industrial machinery.
- 1 -
ENGLISH TRANSLATION OF JAPANESE-LANGUAGE DOCUMENT
This is a translation of the original Japanese-language document and is provided for convenience only. In all cases, the Japanese-language original shall take precedence.
(2) Segment Results
(Billions of yen)
Net sales | Operating income (loss) | |||||||
Six months | Change | Six months | Change | |||||
Six months | Change | (%) | Six months | Change | (%) | |||
ended | ended | 〔Local | ended | ended | 〔Local | |||
(%) | (%) | |||||||
June 30, 2022 June 30, 2023 | currency | June 30, 2022 June 30, 2023 | currency | |||||
Packaging & | basis〕 | basis〕 | ||||||
257.4 | 266.6 | 3.5% | -1.3% | 7.7 | 8.3 | 7.7% | 6.8% | |
Graphic | ||||||||
Color & | 133.9 | 117.8 | -12.0% | -17.9% | 7.8 | (0.1) | Loss | Loss |
Display | ||||||||
Functional | 153.2 | 149.4 | -2.5% | -4.6% | 13.3 | 6.7 | -50.0% | -51.8% |
Products | ||||||||
Others, | (18.5) | (4.8) | ||||||
Corporate and | (23.1) | ― | ― | (4.8) | ― | ― | ||
eliminations | ||||||||
Total | 521.4 | 515.3 | -1.2% | -5.5% | 24.0 | 10.0 | -58.4% | -58.3% |
Packaging & Graphic
Six months | Six months | Change (%) | ||
ended | ended | Change (%) | ||
〔Local currency basis〕 | ||||
June 30, 2022 | June 30, 2023 | |||
Net sales | ¥257.4 billion | ¥266.6 billion | 3.5% | -1.3% |
Operating income | ¥7.7 billion | ¥8.3 billion | 7.7% | 6.8% |
Segment sales advanced 3.5%, to ¥266.6 billion. On a local currency basis, sales were down 1.3%. Shipments of packaging inks, used chiefly on packaging for food products, slumped in all regions, owing to rising consumer prices, but sales were essentially level thanks to successful efforts to maintain sales prices. In publication inks, which center on inks for commercial printing and news inks, sales were down, as dwindling demand and price competition in the Americas and Europe, as well as in Asia, countered efforts to adjust sales prices worldwide. Sales of jet inks, used in digital printing, were pushed down by a decline in overall demand, a consequence of conspicuous efforts to curb inventories, particularly by overseas customers, amid worsening inflation and interest rates in the United States and Europe.
Segment operating income increased 7.7%, to ¥8.3 billion. Operating income in Japan decreased, as sales of high-value-added jet inks were down and efforts to counter higher costs in the area of packaging inks and publication inks by modifying sales prices fell short. Operating income overseas was up overall, buttressed by the success of price adjustments for packaging inks and publication inks, particularly in the Americas and Europe.
- 2 -
ENGLISH TRANSLATION OF JAPANESE-LANGUAGE DOCUMENT
This is a translation of the original Japanese-language document and is provided for convenience only. In all cases, the Japanese-language original shall take precedence.
Color & Display
Six months | Six months | Change (%) | ||
ended | ended | Change (%) | ||
〔Local currency basis〕 | ||||
June 30, 2022 | June 30, 2023 | |||
Net sales | ¥133.9 billion | ¥117.8 billion | -12.0% | -17.9% |
Operating income | ¥7.8 billion | ¥(0.1) billion | Loss | Loss |
Segment sales declined 12.0%, to ¥117.8 billion. Shipments of pigments for coatings and for plastics, which account for a significant proportion of segment sales, were down overall. Factors behind this result included falling demand and moves by customers to curtail inventories, both consequences of slowing economic growth in Europe, a leading market for these products. Among high-value-added products, sales of pigments for color filters, used in displays, rose, as the progress of display manufacturers' inventory adjustments boosted demand. In pigments for cosmetics, shipments in the Americas and Europe were listless, reflecting deteriorating business confidence, but demand in Asia continued to rally, bolstered by the lifting of pandemic masking rules. In pigments for specialty applications, shipments of products for agricultural use flagged, a consequence of inventory adjustments by customers, and shipments of pigments for use in building materials remained sluggish in Europe, a primary market for these products, owing to the protracted crisis in Ukraine.
The segment reported an operating loss of ¥0.1 billion. This was despite a recovery in shipments of pigments for color filters and was attributable to, among others, dwindling shipments of pigments for coatings and for plastics, particularly in Europe, and stagnant shipments of high-value-added pigments for specialty applications.
Functional Products
Six months | Six months | Change (%) | ||
ended | ended | Change (%) | ||
〔Local currency basis〕 | ||||
June 30, 2022 | June 30, 2023 | |||
Net sales | ¥153.2 billion | ¥149.4 billion | -2.5% | -4.6% |
Operating income | ¥13.3 billion | ¥6.7 billion | -50.0% | -51.8% |
Segment sales dipped 2.5%, to ¥149.4 billion. Sales of digital materials, used principally in electrical and electronics equipment and in displays, waned as the market for epoxy resins, the foremost application for which is semiconductors, weakened and overall shipments declined. The same issue also pushed down sales of industrial-use adhesive tapes, used mainly in smartphones and other mobile devices. Despite stagnating shipments of materials for use in automobiles, sales of industrial materials, used primarily in mobility solutions, advanced, underpinned by the addition of the sales of Guangdong DIC TOD Resins Co., Ltd. a coating resins manufacturer in the PRC acquired in July 2022. Sales of polyphenylene sulfide (PPS) compounds advanced, despite shipments for use in automobiles remaining in recovery mode, bolstered by the positive impact of factors such as sales price adjustments.
Segment operating income fell 50.0%, to ¥6.7 billion. This substantial decrease was despite efforts to modify sales prices for all products to pass on cost increases and reflected sinking shipments of high-value-added products used in electrical and electronics equipment and in mobility solutions.
- 3 -
Attachments
- Original Link
- Original Document
- Permalink
Disclaimer
DIC Corporation published this content on 09 August 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 09 August 2023 03:08:42 UTC.
