Fuso Chemical : Announcement of financial results for the second quarter ended September 30, 2023

October 31, 2023

Company name:

FUSO CHEMICAL CO., LTD.

Stock exchange listing:

Tokyo

Stock code:

4368

URL https://fusokk.co.jp

Representative:

Representative Director & President

Shinichi Sugita

Inquiries:

Senior Executive Officer,

Hiroyuki Ito

TEL

03-3639-6311

Division Manager of Administration Division

Scheduled date to file Quarterly Securities Report:

November 10, 2023

Scheduled date to commence dividend payments:

December 8, 2023

Preparation of supplementary material on quarterly financial results:

No

Holding of quarterly financial results meeting:

Yes

(for institutional investors)

(Amounts less than one million yen are rounded down)

1. Consolidated financial results for the six months ended September 30, 2023 (from April 1, 2023 to September 30, 2023)

(1) Consolidated operating results (cumulative)

Percentages indicate year-on-year changes

Net sales

Operating profit

Ordinary profit

Profit attributable to

owners of parent

Millions of yen

%

Millions of yen

%

Millions of yen

%

Millions of yen

%

Six months ended September 30, 2023

27,135

(23.3)

5,581

(41.7)

6,245

(41.9)

4,287

(43.0)

Six months ended September 30, 2022

35,359

40.5

9,578

49.1

10,757

65.9

7,516

67.5

Note: Comprehensive income

Six months ended September 30, 2023

¥5,472 million

[(37.1)%]

Six months ended September 30, 2022

¥8,704 million

[84.8%]

Earnings per share

Diluted earnings per share

Yen

Yen

Six months ended September 30, 2023

121.64

-

Six months ended September 30, 2022

213.26

-

Reference: Operating profit before depreciation and amortization (Consolidated operating profit + depreciation and amortization)

Six months ended September 30, 2023

¥8,367 million

Six months ended September 30, 2022

¥11,624 million

(2) Consolidated financial position

Total assets

Net assets

Equity ratio

Net assets per share

Millions of yen

Millions of yen

%

Yen

As of September 30, 2023

127,659

91,818

71.9

2,604.81

As of March 31, 2023

113,528

87,502

77.1

2,482.80

Reference: Equity

As of September 30, 2023

¥91,818 million

As of March 31, 2023

¥87,502 million

2. Cash dividends

Annual dividends per share

1st quarter-end

2nd quarter-end

3rd quarter-end

Fiscal year-end

Total

Yen

Yen

Yen

Yen

Yen

Year ended March 31, 2023

-

30.00

-

33.00

63.00

Year ending March 31, 2024

-

33.00

Year ending March 31, 2024 (Forecast)

-

33.00

66.00

Net sales

Operating profit

Ordinary profit

Profit attributable to

Earnings per share

owners of parent

Millions of yen

%

Millions of yen

%

Millions of yen

%

Millions of yen

%

Yen

Full year

60,500

(11.6)

10,950

(42.2)

11,550

(41.5)

7,900

(44.1)

224.13

Full year

¥18,250 million

[(21.6)%]

4. Notes

(1)

Changes in significant subsidiaries during the six months ended September 30, 2023

No

(changes in specified subsidiaries resulting in the change in scope of consolidation):

(2)

Application of special accounting methods for preparing quarterly consolidated financial statements:

Yes

Note: Simple accounting procedures and accounting procedures specific for the preparation of quarterly consolidated financial statements.

(3)

Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial statements

Changes in accounting policies due to revisions to accounting standards and other regulations:

No

Changes in accounting policies due to other reasons:

No

Changes in accounting estimates:

No

Restatement of prior period financial statements:

No

(4)

Number of issued shares (common shares)

Total number of issued shares at the end of the period (including treasury shares)

As of September 30, 2023

35,511,000 shares

As of March 31, 2023

35,511,000 shares

Number of treasury shares at the end of the period

As of September 30, 2023

261,281 shares

As of March 31, 2023

267,466 shares

Average number of shares during the period (cumulative from the beginning of the fiscal year)

Six months ended September 30, 2023

35,245,012 shares

Six months ended September 30, 2022

35,243,575 shares

(Thousands of yen)

As of March 31, 2023

As of September 30, 2023

Assets

Current assets

Cash and deposits

23,412,586

29,384,628

Notes and accounts receivable - trade

14,968,781

14,838,788

Merchandise and finished goods

11,880,482

14,682,344

Work in process

691,534

667,829

Raw materials and supplies

3,468,641

3,961,945

Other

936,534

2,786,832

Allowance for doubtful accounts

(14,513)

(13,411)

Total current assets

55,344,047

66,308,957

Non-current assets

Property, plant and equipment

Buildings and structures, net

9,418,074

15,652,556

Machinery, equipment and vehicles, net

6,240,614

16,615,714

Land

6,913,458

6,928,622

Construction in progress

30,938,084

15,130,767

Other, net

791,270

969,189

Total property, plant and equipment

54,301,501

55,296,850

Intangible assets

1,346,426

3,513,556

Investments and other assets

Investment securities

691,304

787,993

Long-term prepaid expenses

366,419

303,137

Deferred tax assets

1,173,700

1,044,594

Retirement benefit asset

102,262

87,085

Other

203,209

317,317

Allowance for doubtful accounts

(0)

(0)

Total investments and other assets

2,536,896

2,540,127

Total non-current assets

58,184,824

61,350,534

Total assets

113,528,872

127,659,492

(Thousands of yen)

As of March 31, 2023

As of September 30, 2023

Liabilities

Current liabilities

Notes and accounts payable - trade

3,294,849

3,291,187

Accounts payable - other

1,983,822

1,815,276

Accounts payable - facilities

13,775,370

5,570,689

Income taxes payable

3,301,849

1,554,158

Provision for bonuses

690,054

584,209

Provision for bonuses for directors (and other officers)

71,800

44,840

Provision for repairs

356,024

144,423

Other

434,899

664,800

Total current liabilities

23,908,669

13,669,585

Non-current liabilities

Long-term borrowings

-

20,000,000

Deferred tax liabilities

191,191

205,366

Retirement benefit liability

1,624,715

1,676,462

Long-term accounts payable - facilities

167,408

160,022

Asset retirement obligations

27,974

27,974

Other

106,088

101,249

Total non-current liabilities

2,117,377

22,171,075

Total liabilities

26,026,047

35,840,660

Net assets

Shareholders' equity

Share capital

4,334,047

4,334,047

Capital surplus

4,820,722

4,820,722

Retained earnings

76,183,899

79,288,994

Treasury shares

(1,112,711)

(1,086,997)

Total shareholders' equity

84,225,957

87,356,767

Accumulated other comprehensive income

Valuation difference on available-for-sale securities

188,739

237,569

Deferred gains or losses on hedges

(3,019)

5,909

Foreign currency translation adjustment

3,091,146

4,218,585

Total accumulated other comprehensive income

3,276,866

4,462,064

Total net assets

87,502,824

91,818,832

Total liabilities and net assets

113,528,872

127,659,492

(Thousands of yen)

Six months ended

Six months ended

September 30, 2022

September 30, 2023

Net sales

35,359,319

27,135,141

Cost of sales

21,066,444

16,814,953

Gross profit

14,292,874

10,320,188

Selling, general and administrative expenses

4,714,317

4,739,128

Operating profit

9,578,556

5,581,060

Non-operating income

Interest income

25,606

126,560

Dividend income

13,215

6,404

Foreign exchange gains

1,122,723

586,497

Other

23,089

18,615

Total non-operating income

1,184,635

738,078

Non-operating expenses

Interest expenses

-

55,737

Commission expenses

1,769

-

Depreciation

1,767

573

Loss on investments in investment partnerships

1,714

15,547

Other

406

1,319

Total non-operating expenses

5,658

73,178

Ordinary profit

10,757,534

6,245,960

Extraordinary income

Gain on sales of property, plant and equipment

-

1,597

Gain on sale of investment securities

84,121

12,100

Total extraordinary income

84,121

13,697

Extraordinary losses

Loss on retirement of non-current assets

19,489

51,856

Total extraordinary losses

19,489

51,856

Profit before income taxes

10,822,166

6,207,801

Income taxes - current

3,251,619

1,827,070

Income taxes - deferred

54,405

93,492

Total income taxes

3,306,024

1,920,563

Profit

7,516,141

4,287,238

Profit attributable to owners of parent

7,516,141

4,287,238

(Thousands of yen)

Six months ended

Six months ended

September 30, 2022

September 30, 2023

Profit

7,516,141

4,287,238

Other comprehensive income

Valuation difference on available-for-sale securities

(106,112)

48,830

Deferred gains or losses on hedges

(2,838)

8,928

Foreign currency translation adjustment

1,297,319

1,127,439

Total other comprehensive income

1,188,368

1,185,197

Comprehensive income

8,704,510

5,472,436

Comprehensive income attributable to

Comprehensive income attributable to owners of parent

8,704,510

5,472,436

Comprehensive income attributable to non-controlling

-

-

interests

(Thousands of yen)

Six months ended

Six months ended

September 30, 2022

September 30, 2023

Cash flows from operating activities

Profit before income taxes

10,822,166

6,207,801

Depreciation

2,046,170

2,785,973

Increase (decrease) in allowance for doubtful accounts

(1,279)

(2,501)

Increase (decrease) in provision for bonuses

52,859

(108,837)

Increase (decrease) in provision for bonuses for directors (and

(1,600)

(26,960)

other officers)

Increase (decrease) in retirement benefit liability

53,231

66,747

Increase (decrease) in provision for repairs

(204,097)

(211,600)

Interest and dividend income

(38,822)

(132,965)

Interest expenses

-

55,737

Foreign exchange losses (gains)

(796,974)

(497,195)

Loss (gain) on sale of property, plant and equipment

-

(1,597)

Loss on retirement of non-current assets

19,489

51,856

Loss (gain) on sale of investment securities

(84,121)

(12,100)

Loss (gain) on investments in investment partnerships

1,714

15,547

Decrease (increase) in trade receivables

(1,000,846)

368,095

Decrease (increase) in inventories

(1,660,655)

(2,988,199)

Increase (decrease) in trade payables

(231,818)

(72,638)

Increase (decrease) in accounts payable - other

(243,419)

(198,984)

Other, net

12,703

(1,740,564)

Subtotal

8,744,699

3,557,614

Interest and dividends received

32,956

126,709

Interest paid

-

(37,573)

Income taxes paid

(3,488,601)

(3,527,525)

Net cash provided by (used in) operating activities

5,289,053

119,225

Cash flows from investing activities

Payments into time deposits

(812,565)

(1,825,593)

Proceeds from withdrawal of time deposits

562,330

649,473

Proceeds from sale of securities

135,453

-

Purchase of property, plant and equipment

(8,467,796)

(11,135,072)

Proceeds from sale of property, plant and equipment

-

1,597

Purchase of intangible assets

(155,055)

(2,574,812)

Purchase of investment securities

(6,690)

(52,790)

Proceeds from sale of investment securities

118,911

22,994

Proceeds from collection of long-term loans receivable

0

0

Other, net

(12,586)

(139,838)

Net cash provided by (used in) investing activities

(8,637,998)

(15,054,040)

Cash flows from financing activities

Proceeds from long-term borrowings

-

20,000,000

Purchase of treasury shares

-

(495)

Dividends paid

(1,057,227)

(1,162,587)

Repayments of lease liabilities

(4,786)

(5,001)

Net cash provided by (used in) financing activities

(1,062,014)

18,831,915

Effect of exchange rate change on cash and cash equivalents

1,219,665

781,287

Net increase (decrease) in cash and cash equivalents

(3,191,293)

4,678,387

Cash and cash equivalents at beginning of period

23,460,102

22,350,871

Cash and cash equivalents at end of period

20,268,808

27,029,259