Kureha : FY2022 2Q Results

FY2022 Interim Report

November 9, 2022

Contents

Summary	2
I. FY2022 Half-Year Results
•	1Q-2Q FY22 Financial summary	4-6
•	Segment performance	7-11
•	Cash flow	12
•	Financial position	13
II. FY2022 Full-Year Outlook
•	FY22 Financial forecast	15-17
•	Segment forecast	18-22
•	Cash flow	23
•	Key indicators	24-25

1

III.	Appendix
•	PVDF business	27
•	PGA business	28
•	Returning to shareholders	29
•	Consolidated companies	30-31

2

Summary

FY2022 Overview

Revenue and profit growth continues, absorbing impact of inflation and higher expenses

• Delivered half-year operating profit of ¥16.7bn, a 47% increase from a year ago, 29% above most recent forecast
• Full-yearoperating profit expected to reach ¥27.0bn (up 34% YoY; up 23% vs. initial forecast)

1Q-2Q FY22 business conditions

• Increased costs for coal (used at the Iwaki Factory) and basic chemicals (naphtha, benzene, VC monomers, etc.)
• Rising Inflation around the world, rapidly depreciating Japanese yen
• Continued market expansion for electric vehicles, partially offset by semiconductor shortages
• Strong agrochemicals demand propelled by increased farming activities and higher crop prices
• Limited impact of China's lockdowns on our local PVDF manufacturing operations

Updates on potential business risks (reflected in our initial full-year forecast on May 12)

	Risk factors	Impact	1Q-2Q FY22	3Q-4Q FY22
	Higher fuel and raw material	Significant	- Increased Advanced Materials and	- Increased Specialty Plastics prices in
	costs, including for coal		Specialty Chemicals prices	October (pricing actions completed for
			- Impact partially mitigated by using existing	all key products)
			stock and favorable currency effects	- Continued challenges for uncompetitive
				businesses
	The COVID pandemic affecting	Medium	- Marginal impact of halted operations at the	- Continued risk for local operations
	Advanced Materials businesses		Shanghai carbon fiber plant
	Slower EV/LiB market expansion	Medium	- Continued EV market expansion	- Market expansion likely to slow down
	in Europe (due to Russia-Ukraine			temporarily due to inflation and
	war, energy shortages)			economic downturn
	Higher logistics and materials	Mild	- Pricing actions for each business
	costs for Specialty Plastics

3

I. FY2022 Half-Year (2Q) Results

(April 1, 2022 through September 30, 2022)

4

1Q-2Q FY2022 Financial Summary (1)

(in billions of yen)

	1Q-2Q	1Q-2Q	Changes	Most	Changes
	vs.
	recent	vs.
	FY21	FY22	1Q-2Q
	Forecast*	Forecast
			FY21
Revenue	79.1	101.8	22.7	100.0	1.8
(+28.7%)	(+1.8%)
Core operating	11.1	16.6	5.5	13.3	3.3
profit	(+49.0%)	(+24.6%)
Operating profit	11.4	16.7	5.4	13.0	3.7
(+47.3%)	(+28.7%)
Profit before taxes	11.5	17.4	5.9	13.5	3.9
(+51.8%)	(+28.7%)
Profit attributable to	8.3	12.2	3.9	9.5	2.7
owners of Kureha	(+46.4%)	(+28.3%)
Basic profit per	¥426.73	¥624.60		¥486.74
share (¥)
(Currency exchange rates)
1USD=	¥109.8	I¥134.0		¥131.0
1EUR=	¥130.9	¥138.8		¥141.0
1CNY=	¥17.0	¥19.9		¥19.0

Vs. 1Q-2Q FY21

• Revenue increased with sales expansion of advanced plastics, particularly PVDF used as a binder material for lithium-ion batteries, and higher agrochemicals volumes resulting from front-loaded shipments
• Higher operating profit led by advanced plastics and agrochemicals

Vs. Forecast

• Better-than-expectedperformances in advanced plastics, agrochemicals and home products

*The most recent 1Q-2Q financial forecast was released on August 9, 2022.