Securities Code:4631 Consolidated Financial Results FY: Full-Year Ended December 31 February 2018 2
Contents Quarterly trends in segment results (Reference) 2 Summary of financial results 3 Segment results 4 Printing Inks 5 Fine Chemicals 6 Polymers 7 Compounds 8 Application Materials 9 Consolidated balance sheet 10 Consolidated statement of income 11 Consolidated statement of cash flows 12 Full-year forecasts 13 Full-year segment results forecasts 14 Reference Principal products and initiatives by segment 15, 16 Historical performance data 17, 18 The fiscal year of DIC Corporation and its domestic and overseas consolidated subsidiaries ends on December 31. This document presents consolidated results for fiscal year, comprising the accounts for the twelve months ended December 31,. Disclaimer Regarding Forward-Looking Statements Statements herein, other than those of historical fact, are forward-looking statements that reflect management s projections based on information available as of the publication date. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from such statements. These risks and uncertainties include, but are not limited to, economic conditions in Japan and overseas, market trends, raw materials prices, interest rate trends, exchange rates, conflicts, litigations, disasters and accidents, as well as the possibility the Company will incur special losses related to the restructuring of its operations. 1
Quarterly trends in segment results (Reference) 200.6 188.2 189.0 189.5 193.7 181.8 206.1 191.9 Progress rate as per the full-year operating income forecasts 1Q 2Q 3Q 4Q (%) 23.4 46.5 72.4 100.9 (%) 22.9 48.3 74.7 100.3 15.9 94.3 89.9 91.3 91.6 87.4 94.4 92.2 97.8 13.1 12.3 4.0 13.8 4.0 12.9 3.8 14.2 14.6 13.9 4.3 5.2 4.9 5.3 4.3 32.4 34.3 33.4 33.2 31.5 34.6 30.9 33.3 3.0 4.2 4.0 4.3 3.9 4.6 3.5 4.3 44.3 46.9 45.4 48.3 43.6 50.2 47.6 52.5 4.5 4.5 4.9 4.5 4.9 4.8 5.3 5.8 15.3 15.0 15.5 16.1 14.6 16.8 15.7 16.8 12.5 12.8 14.2 13.9 13.9 14.1 15.1 15.3-10.6-9.9-10.3-9.4-9.2-9.5-9.6-9.6 1.3 0.8 1.5 1.4 1.5 1.3 1.0 1.2 0.3 0.8 0.6 0.3 0.5 0.7 0.5 0.8-1.1-1.2-1.2-1.3-1.3-1.2-1.5-1.8 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Printing Inks Fine Chemicals Polymers Compounds Application Materials Others, Corporate and eliminations 2
Summary of financial results Operating results Financial health 751.4 789.4 +5.1% +3.5% 54.2 56.5 +4.2% +3.9% Operating margin 7.2% 7.2% - - Ordinary income 55.8 57.0 +2.1% - Net income* 34.8 38.6 +11.0% - EPS** (Yen) 366.72 407.56 End End Interest-bearing debt 241.3 265.7 24.4 Net interest-bearing debt 224.0 247.8 23.8 Net assets 307.0 344.0 36.9 D/C ratio *** 44.0% 43.6% - BPS (Yen) 2,938.12 3,329.60 Closing rate (USD/YEN) 116.69 112.70 Average rate USD/YEN 109.96 112.33 +2.2% EUR/USD 1.11 1.13 +1.8% Generally firm shipments Capital expenditure and investment Waning demand for publishing inks and news inks Operating income Record High Improved product mix Rationalization efforts and cost reductions Increase in raw materials prices Negative impact of weak emerging economy currencies after translation Capital expenditure and investment Depreciation and amortization 32.1 62.4 30.4 32.4 31.5-0.9 Capital expenditure and investment: Increased, owing to investment in TAIYO HOLDINGS CO., LTD. and others Ordinary income Record High Rose, with contributing factors including higher operating income and an improved financial position Net Income* Record High Climbed, owing to a decrease in extraordinary loss and and other factors, which countered A portion of planned rationalization of publishing inks businesses in the Americas and Europe was postponed until 2018 * Net income attributable to owners of the parent ** Adjusted to reflect the impact of the consolidation of shares of common stock ***D/C ratio: Interest-bearing debt / (Interest-bearing debt + Net assets) 3
Segment results Operating margin % Printing Inks 365.2 373.7 8.5 + 2.3% + 0.5% 18.4 17.4-1.0-5.0% -4.0% 5.0% 4.7% Japan 79.8 77.1-2.7-3.3% -3.3% 5.1 3.9-1.2-22.5% -22.5% 6.4% 5.1% The Americas and Europe 232.7 241.1 8.4 + 3.6% + 1.4% 8.4 9.5 1.1 + 12.9% + 16.5% 3.6% 4.0% Asia and Oceania 61.6 64.8 3.2 + 5.3% + 2.2% 4.8 4.0-0.8-17.2% -19.8% 7.9% 6.2% Eliminations (8.9) (9.4) -0.5 - - (0.0) (0.0) -0.0 - - - - Fine Chemicals 128.2 135.4 7.2 + 5.7% + 3.5% 14.4 17.4 3.0 + 20.3% + 18.3% 11.3% 12.8% Japan 41.3 43.7 2.4 + 5.7% + 5.7% 7.5 8.3 0.8 + 11.1% + 11.1% 18.1% 19.0% Overseas 101.1 107.0 5.9 + 5.8% + 2.9% 7.1 9.2 2.1 + 29.2% + 25.4% 7.0% 8.6% Eliminations (14.3) (15.3) -1.0 - - (0.1) (0.1) 0.0 - - - - Polymers 180.9 197.9 17.0 + 9.4% + 8.4% 19.6 19.6-0.0-0.2% -0.7% 10.9% 9.9% Japan 136.4 147.0 10.6 + 7.8% + 7.8% 12.9 14.3 1.4 + 10.5% + 10.5% 9.5% 9.7% Overseas 50.1 57.9 7.8 + 15.5% + 12.1% 6.7 5.4-1.3-19.7% -22.3% 13.4% 9.3% Eliminations (5.6) (6.9) -1.3 - - 0.0 (0.1) -0.1 - - - - Compounds 61.1 64.7 3.6 + 5.8% + 4.8% 5.0 5.0 0.0 + 0.3% + 0.9% 8.1% 7.7% Japan 39.2 41.7 2.5 + 6.2% + 6.2% 2.5 3.1 0.6 + 22.5% + 22.5% 6.4% 7.3% Overseas 33.3 35.9 2.6 + 7.7% + 5.8% 2.4 2.0-0.4-17.6% -17.3% 7.1% 5.4% Eliminations (11.5) (12.9) -1.4 - - 0.1 (0.0) -0.1 - - - - Application Materials 55.7 56.1 0.4 + 0.7% + 0.4% 1.9 2.6 0.7 + 39.2% + 38.9% 3.4% 4.6% Japan 52.7 53.0 0.3 + 0.7% + 0.7% 1.6 2.3 0.7 + 45.5% + 45.5% 3.0% 4.3% Overseas 9.9 10.8 0.9 + 8.7% + 6.9% 0.3 0.3 0.0 + 14.9% + 12.6% 3.0% 3.2% Eliminations (6.9) (7.7) -0.8 - - 0.0 (0.0) -0.0 - - - - Others, Corporate and eliminations (39.7) (38.4) 1.3 - - (5.1) (5.5) -0.4 - - - - Total 751.4 789.4 38.0 + 5.1% + 3.5% 54.2 56.5 2.3 + 4.2% + 3.9% 7.2% 7.2% USD/YEN 109.96 112.33 + 2.2% 109.96 112.33 + 2.2% EUR/USD 1.11 1.13 + 1.8% 1.11 1.13 + 1.8% % 4
Segment results Printing Inks Operating margin % % Printing Inks 365.2 373.7 8.5 + 2.3% + 0.5% 18.4 17.4-1.0-5.0% -4.0% 5.0% 4.7% Japan 79.8 77.1-2.7-3.3% -3.3% 5.1 3.9-1.2-22.5% -22.5% 6.4% 5.1% The Americas and Europe 232.7 241.1 8.4 + 3.6% + 1.4% 8.4 9.5 1.1 + 12.9% + 16.5% 3.6% 4.0% Asia and Oceania 61.6 64.8 3.2 + 5.3% + 2.2% 4.8 4.0-0.8-17.2% -19.8% 7.9% 6.2% Eliminations (8.9) (9.4) -0.5 - - (0.0) (0.0) -0.0 - - - - Japan The Americas and Europe Asia and Oceania Sales of packaging inks benefited from firm shipments. Nonetheless, overall sales in Japan decreased, reflecting factors such as diminished demand for publishing inks and news inks. Although demand for publishing inks and news inks waned, sales in North America were flat, with causes including higher shipments of packaging inks. In Europe, sales edged up, as firm shipments of publishing inks and packaging inks countered falling demand for news inks. Sales in Central and South America rose, buoyed by robust shipments of packaging inks. Overall sales in the Americas and Europe increased. While shipments of packaging inks were solid, sales in the People s Republic of China decreased, hindered by factors such as flagging demand for publishing inks and news inks. In Southeast Asia, sales were pushed up by higher shipments of publishing inks and packaging inks. Sales in Oceania fell, with causes including fading demand for news inks. Sales in India increased, bolstered by brisk shipments of publishing inks and packaging inks. Overall sales in Asia and Oceania rose. fell sharply, owing to the aforementioned sales results and other factors. advanced, bolstered by the aforementioned sales results and rationalization measures, among others. declined, regardless of the aforementioned sales results, a consequence of rising raw materials prices and other factors. 5
Segment results Fine Chemicals Operating margin % % Fine Chemicals 128.2 135.4 7.2 + 5.7% + 3.5% 14.4 17.4 3.0 + 20.3% + 18.3% 11.3% 12.8% Japan 41.3 43.7 2.4 + 5.7% + 5.7% 7.5 8.3 0.8 + 11.1% + 11.1% 18.1% 19.0% Overseas 101.1 107.0 5.9 + 5.8% + 2.9% 7.1 9.2 2.1 + 29.2% + 25.4% 7.0% 8.6% Eliminations (14.3) (15.3) -1.0 - - (0.1) (0.1) 0.0 - - - - Sales of pigments were down, despite a steep increase in shipments of functional pigments, including those for color filters, owing to flagging demand for other pigments. Sales of TFT LCs rose substantially, reflecting favorable shipments. These factors supported higher segment sales. Sales of principal products % change Y on Y Liquid crystal (LC) materials + 20% Functional pigments + 5% Other pigments -5% Segment operating income was up significantly, underpinned by an improved product mix, among others. 6
Segment results Polymers Operating margin % Polymers 180.9 197.9 17.0 + 9.4% + 8.4% 19.6 19.6-0.0-0.2% -0.7% 10.9% 9.9% Japan 136.4 147.0 10.6 + 7.8% + 7.8% 12.9 14.3 1.4 + 10.5% + 10.5% 9.5% 9.7% Overseas 50.1 57.9 7.8 + 15.5% + 12.1% 6.7 5.4-1.3-19.7% -22.3% 13.4% 9.3% Eliminations (5.6) (6.9) -1.3 - - 0.0 (0.1) -0.1 - - - - % Sales in Japan rose, bolstered by increased shipments of high-valueadded products, polystyrene and other products. Sales overseas were up sharply, thanks to generally firm shipments. For these and other reasons, segment sales advanced. Sales of principal products % change Y on Y Waterborne resins + 10% Saturated polyester resins + 5% Acrylic resins + 4% UV-curable resins + 6% Notwithstanding the impact of rising raw materials prices, segment operating income was flat. Factors behind this result included the aforementioned sales results. Polyurethane resins + 6% Epoxy resins + 13% Unsaturated polyester resins + 9% Polystyrene + 20% 7
Segment results Compounds % Compounds 61.1 64.7 3.6 + 5.8% + 4.8% 5.0 5.0 0.0 + 0.3% + 0.9% 8.1% 7.7% Japan 39.2 41.7 2.5 + 6.2% + 6.2% 2.5 3.1 0.6 + 22.5% + 22.5% 6.4% 7.3% Overseas 33.3 35.9 2.6 + 7.7% + 5.8% 2.4 2.0-0.4-17.6% -17.3% 7.1% 5.4% Eliminations (11.5) (12.9) -1.4 - - 0.1 (0.0) -0.1 - - - - % Operating margin Healthy shipments pushed up sales of polyphenylene sulfide (PPS) compounds. Steadily expanding shipments bolstered sales of jet inks. Owing to these and other factors, segment sales rose. Sales of principal products % change Y on Y PPS compounds + 7% Jet inks + 8% Plastic colorants + 12% Segment operating income remained level. Reasons behind this result included the aforementioned sales results, which offset increases in raw materials prices and costs associated with advance investments. 8
Segment results Application Materials Operating margin % Application Materials 55.7 56.1 0.4 + 0.7% + 0.4% 1.9 2.6 0.7 + 39.2% + 38.9% 3.4% 4.6% Japan 52.7 53.0 0.3 + 0.7% + 0.7% 1.6 2.3 0.7 + 45.5% + 45.5% 3.0% 4.3% Overseas 9.9 10.8 0.9 + 8.7% + 6.9% 0.3 0.3 0.0 + 14.9% + 12.6% 3.0% 3.2% Eliminations (6.9) (7.7) -0.8 - - 0.0 (0.0) -0.0 - - - - % Segment sales increased, with contributing factors including higher shipments of industrial adhesive tapes and hollow-fiber membrane modules. Sales of principal products % change Y on Y Industrial adhesive tapes + 12% Coextruded multilayer films + 2% Hollow-fiber membrane modules + 10% Health foods -10% Segment operating income rose substantially, spurred by an improved product mix and efforts to reduce costs, among others. 9
Consolidated balance sheet End End Current assets 398.7 425.0 26.2 Property, plant and equipment 226.7 231.7 5.0 Intangible assets 8.9 7.6-1.4 Investments and other assets 130.5 167.5 37.0 Total assets 764.8 831.8 66.9 Current liabilities 265.3 266.6 1.3 Non-current liabilities 192.5 221.2 28.7 Total liabilities 457.8 487.8 30.0 Shareholders' equity 349.0 375.9 27.0 Accumulated other comprehensive income (70.4) (60.8) 9.6 [Foreign translation adjustment] [(48.6)] [(46.5)] [2.2] Non-controlling interests 28.5 28.8 0.3 Total net assets 307.0 344.0 36.9 Total liabilities and net assets 764.8 831.8 66.9 Closing rate (USD/YEN) 116.69 112.70 Shareholders' equity to total assets 36.4% 37.9% Interest-bearing debt 241.3 265.7 24.4 Cash and deposits 17.2 17.9 0.6 Increased, owing to investment in TAIYO HOLDINGS CO., LTD. and others 10
Consolidated statement of income Extraordinary income and loss 751.4 789.4 38.0 Cost of sales 571.9 605.8 33.9 Selling, general and administrative expenses 125.4 127.1 1.8 54.2 56.5 2.3 Interest expenses (2.7) (1.7) 0.9 Equity in earnings of affiliates 3.3 4.1 0.8 Foreign exchange gains (losses) 0.6 (1.5) -2.1 Other, net 0.4 (0.4) -0.8 Ordinary income 55.8 57.0 1.2 Extraordinary income 0.9 2.1 1.2 Extraordinary loss (6.8) (4.2) 2.6 Income before income taxes 49.9 54.8 4.9 Income taxes (12.3) (13.9) -1.6 Net income 37.6 40.9 3.4 Net income attributable to noncontrolling interests Net income attributable to owners of the parent (2.8) (2.3) 0.5 34.8 38.6 3.8 Average rate USD/YEN 109.96 112.33 EUR/USD 1.11 1.13 Extraordinary income Gain on sales of noncurrent assets - 1.2 Gain on change in equity - 0.6 Gain on sales of subsidiaries and affiliates securities - 0.3 State Subsidy 0.8 - Gain on bargain purchase 0.1 - Extraordinary loss Loss on disposal of noncurrent assets (4.4) (2.7) Severance costs (1.4) (1.0) Early termination fee - (0.4) Impairment loss - (0.2) Provision of allowance for doubtful accounts (0.6) - Loss on disaster (0.4) - Decline in extraordinary loss A portion of planned rationalization of publishing inks businesses in the Americas and Europe was postponed until 2018 11
Consolidated statement of cash flows Cash flows from operating activities 62.5 54.2-8.3 Cash flows from investing activities (32.2) (58.9) -26.7 Cash flows from financing activities (26.9) 11.4 38.2 Cash and cash equivalents at end of the period 16.7 17.7 1.0 Free cash flow 30.3 (4.7) -35.0 Increase (decrease) in working capital (4.8) (7.5) -2.7 Capital expenditure and investment 32.1 62.4 30.4 Depreciation and amortization 32.4 31.5-0.9 Cash flows from investing activities: Increase in capital expenditure and investment, owing to investment in TAIYO HOLDINGS and others Cash flows from financing activities: Increase attributable to the procurement of funds for equity investments 12
FY2018: Full-year forecasts Business performance are expected to increase, underpinned by higher shipments in all segments is expected to rise thanks to higher shipments and an improved product mix, which are expected to offset the impact of higher raw materials prices Actual 2018 Forecast 789.4 820.0 +3.9% +3.9% 56.5 58.0 +2.7% +2.3% Operating margin 7.2% 7.1% - - Ordinary income 57.0 58.0 +1.8% - Net income* 38.6 40.0 +3.6% - EPS (Yen) 407.56 422.63 Average rate USD/YEN 112.33 110.00-2.1% EUR/USD 1.13 1.20 +6.2% ROE 13.0% 12.2% Annual dividends per share (Yen) 120.0 125.0 Payout ratio 29.4% 29.6% 1st Half Actual 2018 1st Half Forecast 382.7 400.0 +4.5% +3.7% 26.0 26.0-0.1% -1.7% 6.8% 6.5% - - 26.1 26.0-0.3% - 17.4 17.5 +0.3% - 184.01 184.90 112.66 110.00-2.4% 1.08 1.20 +11.1% Capital expenditure and investment Actual Capital expenditure and investment Depreciation and amortization 2018 Forecast 62.4 51.0-11.4 31.5 33.0 1.5 Financial health End 2018End Forecast Interest-bearing debt 265.7 260.0-5.6 Net assets 344.0 368.5 24.5 D/C ratio ** 43.6% 41.4% - * Net income attributable to owners of the parent ** D/C ratio: Interest-bearing debt / (Interest-bearing debt + Net assets) 13
FY2018: Full-year segment results forecasts Actual 2018 Forecast % Printing Inks 373.7 391.4 17.7 + 4.7% + 4.8% 17.4 17.8 0.4 + 2.2% + 1.6% 4.7% 4.6% Japan 77.1 77.7 0.6 + 0.7% + 0.7% 3.9 4.1 0.2 + 4.9% + 4.9% 5.1% 5.3% The Americas and Europe 241.1 251.0 9.9 + 4.1% + 4.0% 9.5 9.0-0.5-6.0% -7.0% 4.0% 3.6% Asia and Oceania 64.8 71.9 7.1 + 11.0% + 11.7% 4.0 4.7 0.7 + 17.9% + 18.8% 6.2% 6.6% Eliminations (9.4) (9.2) 0.2 - - (0.0) 0.0 0.0 - - - - Fine Chemicals 135.4 132.5-2.9-2.2% -2.1% 17.4 17.0-0.4-2.1% -3.2% 12.8% 12.8% Japan 43.7 40.0-3.7-8.4% -8.4% 8.3 8.3 0.0 + 0.1% + 0.1% 19.0% 20.8% Overseas 107.0 107.7 0.7 + 0.7% + 1.0% 9.2 8.7-0.5-5.4% -7.4% 8.6% 8.0% Eliminations (15.3) (15.3) -0.0 - - (0.1) 0.0 0.1 - - - - Polymers 197.9 204.3 6.4 + 3.2% + 3.4% 19.6 20.1 0.5 + 2.4% + 2.7% 9.9% 9.8% Japan 147.0 147.4 0.4 + 0.3% + 0.3% 14.3 14.0-0.3-1.9% -1.9% 9.7% 9.5% Overseas 57.9 63.4 5.5 + 9.6% + 10.4% 5.4 6.1 0.7 + 13.3% + 14.6% 9.3% 9.7% Eliminations (6.9) (6.6) 0.3 - - (0.1) (0.0) 0.1 - - - - Compounds 64.7 69.5 4.8 + 7.5% + 7.6% 5.0 5.0 0.0 + 0.4% + 0.2% 7.7% 7.2% Japan 41.7 43.8 2.1 + 5.0% + 5.0% 3.1 3.0-0.1-1.9% -1.9% 7.3% 6.9% Overseas 35.9 39.5 3.6 + 10.0% + 10.4% 2.0 2.0 0.0 + 2.7% + 2.3% 5.4% 5.1% Eliminations (12.9) (13.7) -0.8 - - (0.0) 0.0 0.0 - - - - Application Materials 56.1 58.4 2.3 + 4.2% + 4.4% 2.6 3.6 1.0 + 37.3% + 37.5% 4.6% 6.1% Japan 53.0 55.3 2.3 + 4.3% + 4.3% 2.3 3.2 0.9 + 38.4% + 38.4% 4.3% 5.7% Overseas 10.8 11.3 0.5 + 4.8% + 6.5% 0.3 0.4 0.1 + 20.8% + 22.0% 3.2% 3.6% Eliminations (7.7) (8.2) -0.5 - - (0.0) 0.0 0.0 - - - - Others, Corporate and eliminations (38.4) (36.1) 2.3 - - (5.5) (5.5) 0.0 - - - - Total 789.4 820.0 30.6 + 3.9% + 3.9% 56.5 58.0 1.5 + 2.7% + 2.3% 7.2% 7.1% Actual 2018 Forecast USD/YEN 112.33 110.00-2.1% 112.33 110.00-2.1% EUR/USD 1.13 1.20 + 6.2% 1.13 1.20 + 6.2% % Operating margin Actual 2018 Forecast 14
Reference Principal products and initiatives by segment Segment* Principal products Principal applications Initiatives in 2018 Printing Inks ( P.5) Packaging inks Further expand sales in packaging-related markets Sales JPY 373.7 billion Packaging for food products Shrink sleeve labels for plastic bottles (Margin) JPY 17.4 billion 4.7% Publishing inks News inks Newspapers Catalogs and leaflets Boost sales of environment-friendly products Further enhance production efficiency Printing inks products information Fine Chemicals ( P.6) Functional pigments Color filters for Focus on high-growth businesses Sales LCD panels JPY 135.4 billion Cosmetics Metallic pigments Pigments products information (Margin) JPY 17.4 billion 12.8% LC materials Liquid crystals LCD televisions Smartphones Tablet computers Focus allocation of resources on areas in which DIC is strong Polymers ( P.7) Sales JPY 197.9 billion (Margin) JPY 19.6 billion 9.9% Waterborne resins Saturated polyester resins Acrylic resins UV-curable resins Polyurethane resins Epoxy resins Automobiles Exterior coatings Vehicle seats PCs/IT equipment Semiconductor encapsulation materials Shift focus in Japan to niche markets and highvalue-added products Reinforce efforts to respond to needs for waterborne and solvent-free products Polymer product information * actual data 15
Reference Principal products and initiatives by segment Segment* Principal products Principal applications Initiatives in 2018 Compounds ( P.8) Polyphenylene sulfide Strengthen integrated local production, sales and (PPS) compounds technical service configurations at principal overseas Sales bases JPY 64.7 billion Automobile engine peripherals PPS compounds products information (Margin) JPY 5.0 billion Jet inks Industrial- and commercial-use inkjet printers Firmly lock in demand in the large-scale industrialand commercial-use inkjet printer markets 7.7% Application Materials Industrial adhesive Expand sales in markets unrelated to mobile ( P.9) tapes Smartphones PCs devices Sales JPY 56.1 billion Automobiles OA equipment Adhesive tapes product information Hollow-fiber membrane modules Hollow fiber Degasification* of jet inks Deaeration of ultrapure Increase share of the market for degassing modules and decarbonation modules (Margin) JPY 2.6 billion 4.6% water *Degasification is the removal of dissolved gasses from liquids Membrane products information Health foods Step up production and sales of natural blue food (Spirulina) coloring (Linablue) Natural blue food coloring Health supplements Health foods product information * actual data 16
Reference Historical performance data (1) Operating results Financial health 779.0 Sales Operating margin (%) 784.0 734.3 703.8 5.6 5.5 830.1 820.0 6.2 7.2 7.2 7.1 820.0 789.4 751.4 337.6 72.1 Interest-bearing debt Net assets D/C ratio* (%) 328.5 72.5 315.6 66.3 Achieved our D/C ratio* target of 50% four years ahead of schedule 344.0 307.0 299.1 276.7 289.9 274.2 259.5 265.7 260.0 241.3 218.9 368.5 4.8 4.8 4.9 57.7 160.7 130.4 124.5 49.8 47.2 44.0 43.6 41.4 37.2 35.0 38.5 44.1 41.1 51.1 54.2 56.5 58.0 2010 2011 2012 2013 2014 2015 2018 * Adjusted Forecast 2010 2011 2012 2013 2014 2015 2018 Forecast Increase operating margin Increase operating income Improvement of D/C ratio* D/C ratio* around 50% * Adjusted to reflect the impact of the changes in the fiscal year-end * D/C ratio: Interest-bearing debt / (Interest-bearing debt + Net assets) 17
Reference Historical performance data (2) Shareholder returns* Capital expenditure and investment, operating cash flows Yield (%)** Interim (Yen) Year-end (Yen) Payout ratio (%) 22.7 20.2 28.8 Buyback and retirement of treasury shares 20.5 22.4 20.5 27.3 100 80 60 60 60 60 40 40 40 30 30 30 20 20 20 20 30 30 30 40 40 29.4 29.6 120 125 60 65 60 60 2010 2011 2012 2013 2014 2015 2018 Forecas 2.0 2.1 3.6 1.9 2.1 2.4 2.8 2.8 (Billion Yen) 30.9 31.2 22.3 18.6 Operating cash flow Free cash flow Capital expenditure and investment 13.7 41.4 17.7 33.9 28.0 29.4 27.6 24.0 46.4 FY-FY2018 Plan Ordinary investments: 120 billion yen Strategic investments: 150 billion yen 36.3 (Including M&As) 29.1 19.0 19.1 Capital and business alliance with TAIYO HOLDINGS 62.5 34.0 32.1 30.3 62.4 54.2 (4.7) 51.0 2010 2011 2012 2013 2014 2015 2018 Forecast Stable shareholder returns Payout ratio around 30% Invest in growth while prioritizing the improvement of financial health Drive DIC forward * Adjusted to reflect the impact of the consolidation of shares of common stock ** Dividend yield: Annual dividends / Closing price per share at fiscal year-end 18