Interim report
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This document has been translated from the Japanese original for reference purposes only . In the event of any discrepancy between this translated document and the Japanese original , the original shall prevail . FASF Consolidated Financial Results for the Three Months Ended June 30 , 2026 [ JGAAP ] Company Name : Code Number : 4047 Kanto Denka Kogyo Co. , Ltd. https://www.kantodenka.co.jp/english/ Representative : Jun'ichi Hasegawa , President Stock Exchange Listing : August 10 , 2026 Tokyo Contact : Yoshihiro Uehara , General Manager , Public Relations & Investor Relations Dept. Phone : + 81-3-4236-8804 Scheduled date to commence dividend payments : Availability of supplementary briefing material on financial results : Yes Financial results briefing session : None ( Amounts are rounded down to the nearest million yen ) 1. Consolidated financial results for the first quarter of the fiscal year ending March 31 , 2027 ( April 1 , 2026 - June 30 , 2026 ) ( 1 ) Consolidated operating results ( % figures are the rate of year - on - year increase or decrease ) Profit attributable to Net sales Millions of yen 19,774 30.6 15,143 -2.0 Operating profit Ordinary profit % Millions of yen 3,979 410.7 779 -38.5 % Millions of yen % owners of parent Millions of yen % 4,573 515.5 3,235 509.3 743 -61.3 531-54.5 Three months ended June 30 , 2026 Three months ended June 30 , 2025 ( Note ) Comprehensive income : Three months ended June 30 , 2026 : ¥ 4,346 million ( - % ) Three months ended June 30 , 2025 : \ ( 335 ) million ( - % ) Three months ended June 30 , 2026 Three months ended June 30 , 2025 ( 2 ) Consolidated financial position As of June 30 , 2026 As of March 31 , 2026 Basic earnings per share Yen 56.41 9.24 Diluted basic earnings per share Yen Total assets Net assets Equity ratio Net assets per share Millions of yen 140,726 Millions of yen 77,941 % 54.1 Yen 131,314 74,249 55.1 1,326.97 1,262.29 ( Reference ) Equity capital : As of June 30 , 2026 : ¥ 76,106 million As of March 31 , 2026 : ¥ 72,397 million 2. Dividends Annual dividends per share End of 1Q End of 2Q End of 3Q Year - end Total Yen Fiscal year ended March 31 , 2026 Yen 9.00 Yen Yen 11.00 Yen 20.00 Fiscal year ending March 31 , 2027 Fiscal year ending March 31 , 2027 18.00 18.00 36.00 ( Forecast ) ( Note ) Revision of dividend forecast from the latest announcement : None
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3. Forecast of consolidated financial results for the fiscal year ending March 31, 2027 (April 1, 2026–March 31, 2027) (% figures are the rate of year-on-year increase or decrease) Net sales Operating profit Ordinary profit Profit attributable to owners of parent Basic earnings per share Millions of yen % Millions of yen % Millions of yen % Millions of yen % Yen First half 42,200 36.8 6,600 709.6 6,600 578.7 4,400 － 76.72 Full year 95,000 45.3 11,300 106.2 11,300 70.4 7,600 100.8 132.51 (Note) 1. Revision of performance forecast from the latest announcement: Yes Notes: (1) Significant changes in the scope of consolidation during the current quarter: Not applicable New: ― companies (company names); Removed: ― companies (company names) (2) Application of special accounting for preparing quarterly consolidated financial statements: Yes (3) Changes in accounting policies, changes in accounting estimates and retrospective restatement i. Changes in accounting policies accompanying amendments to accounting standards, etc.: None ii. Changes in accounting policies other than i.: None iii. Changes in accounting estimates: None iv. Retrospective restatement: None (4) Number of shares issued (common stock) i. Number of shares issued at the end of the period (including treasury shares) As of June 30, 2026 57,546,050 shares As of March 31, 2026 57,546,050 shares ii. Number of treasury shares at the end of the period As of June 30, 2026 192,101 shares As of March 31, 2026 192,101 shares iii. Average number of shares during the period As of June 30, 2026 57,353,949 shares As of June 30, 2025 57,457,567 shares Notes: 1. Review of the attached quarterly consolidated financial statements by a certified public accountant or auditing firm: None 2. Proper use of performance forecasts, and other special matters (Notes to forward-looking statements) The performance outlooks and other forward-looking statements in this document are based on information currently available to the Company and certain assumptions that the Company deems reasonable, and are not intended to be a promise by the Company that they will be realized. Actual results may differ significantly due to various factors. Please refer to "Consolidated earnings forecasts" on page 3 of the attached materials for information on the performance forecasts.
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- 1 - Contents 1. Overview of operating results, etc............................................................................................................................................2 (1) Operating results ................................................................................................................................................................2 (2) Financial position ...............................................................................................................................................................3 (3) Consolidated earnings forecasts .........................................................................................................................................3 2. Consolidated financial statements and notes ............................................................................................................................4 (1) Consolidated balance sheet.................................................................................................................................................4 (2) Consolidated statement of income and consolidated statement of comprehensive income ................................................6 Consolidated statement of income .......................................................................................................................................6 Consolidated statement of comprehensive income ..............................................................................................................7 (3) Notes to the consolidated financial statements ...................................................................................................................8 (Special accounting for preparing quarterly consolidated financial statements) ..................................................................8 (Segment information) .........................................................................................................................................................8 (Notes on significant changes in the amount of shareholders’ equity) .................................................................................9 (Notes on premise of going concern) ...................................................................................................................................9 (Notes on statement of cash flows) ......................................................................................................................................9
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- 2 - 1. Overview of operating results, etc. (1) Operating results In the first three months of the fiscal year ending March 31, 2027, the Japanese economy showed signs of a gradual recovery due to improvements in the employment and income environments, as well as a recovery in personal consumption and capital investment. However, severe conditions continued to prevail. Overseas, while there was a gradual recovery in the global economy, the outl ook remained uncertain, with a need to closely monitor the situation in the Middle East and fluctuations in financial and capital markets. Amid this business environment, net sales for the first three months amounted to ¥19,774 million, up ¥4,631 million or 30.6% year on year, mainly due to higher sales in the Fine Chemicals Division. On the profit front, the Group recorded an ordinary profit of ¥4,573 million, up ¥3,830 million or 515.5% year on year, due to the increased sales in the Fine Chemicals Division, despite signifi cant increases in raw material and fuel prices. Profit attributable to owners of parent amounted to ¥3,235 million, up ¥2,704 million or 509.3% year on year. The following provides an overview for each segment. a. Fundamental Chemicals Division In inorganic products, sales of caustic soda increased year on year due to higher sales volume. Hydrochloric acid sales increased due to higher sales volume and price adjustments. For organic products, sales of trichloroethylene decreased year on year due to a decline in sales volume. Sales of perchloroethylene increase year on year due to higher sales volume. As a result of the above, net sales in the Fundamental Chemicals Division amounted to ¥2,082 million, up ¥118 million or 6.0% year on year. Operating profit totaled ¥71 million, up ¥32 million or 81.9% year on year. b. Fine Chemicals Division Regarding specialty gases for semiconductors, sales of nitrogen trifluoride decreased compared with the previous fiscal year due to lower sales volume, despite price adjustments. Tungsten hexafluoride sales increased due to price adjustments, despite lower sales volume. Sales of hexafluoro-1,3-butadiene were on par with the same period of the previous year. Sales of carbonyl sulfide were up year on year due to higher sales volume. Sales of lithium hexafluorophosphate, a battery material, increased year on year due to higher sales volume and the effects o f price revisions. As a result of the above, net sales in the Fine Chemicals Division amounted to ¥16,518 million, up ¥4,575 million or 38.3% year on year. Operating profit totaled ¥3,752 million, up ¥3,175 million or 549.7% year on year, mainly due to increased sales, despite significant increases in raw material and fuel prices. c. Ferrochemicals Division Sales of reprographic carriers, used in developers for copiers and printers, were up year on year due to higher sales volumes . Sales of iron oxide were up year on year due to higher sales of colorants. As a result of the above, net sales in the Ferrochemicals Division amounted to ¥550 million, up ¥17 million or 3.3% year on year. Operating profit totaled ¥104 million, up ¥36 million or 54.2% year on year. d. Commercial Business Division Commercial business sales were up year on year due to higher sales of chemical products. As a result of the above, net sales in the Commercial Business Division amounted to ¥209 million, up ¥34 million or 19.5% year on year. Operating profit totaled ¥39 million, down ¥10 million or 20.6% year on year.
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- 3 - e. Facilities Division Net sales in chemical facility plant and general industrial plant construction were down year on year due to a decrease in contract work. As a result of the above, net sales in the Facilities Division amounted to ¥412 million, down ¥114 million or 21.7% year on year. There was an operating loss of ¥15 million (versus an operating profit of ¥46 million in the first three months of the previous fiscal year). (2) Financial position As of the end of the first quarter of the fiscal year ending March 31, 2027, assets amounted to ¥140,726 million, up ¥9,411 m illion from the end of the previous fiscal year. This was mainly due to increases in inventories, other current assets, notes and a ccounts receivable―trade, contract assets, and investment securities, despite a decrease in cash and deposits. Total liabilities amounted to ¥62,784 million, up ¥5,719 million, mainly due to increases in notes and accounts payable—trade and other current liabilities, despite a decrease in borrowings. Net assets amounted to ¥77,941 million, up ¥3,692 million, mainly due to a decrease in foreign currency translation adjustment. The equity ratio was 54.1%, versus 55.1% at the end of the previous fiscal year. (3) Consolidated earnings forecasts The consolidated earnings forecast for the fiscal year ending March 31, 2027 has been revised from the previous forecast announced on May 15, 2026. For details, please refer to the “Notice Concerning Revisions to Financial Results Forecasts” released separately. The above forecasts were created based on information available as of the date of this document's publishing, and actual results may differ versus forecast figures due to a variety of factors arising in the future.
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- 4 - 2. Consolidated financial statements and notes (1) Consolidated balance sheet (Millions of yen) As of March 31, 2026 As of June 30, 2026 Assets: Current assets Cash and deposits 20,220 18,650 Notes and accounts receivable—trade, and contract assets 17,644 19,669 Electronically recorded monetary claims — operating 1,186 1,337 Merchandise and finished goods 6,590 9,197 Work in process 7,666 8,806 Raw materials and supplies 6,921 9,808 Other 4,244 5,515 Allowance for doubtful accounts (31) (33) Total current assets 64,442 72,952 Non-current assets Property, plant and equipment Buildings and structures, net 18,452 18,279 Machinery and equipment, net 22,805 21,712 Construction in progress 5,651 5,573 Other, net 5,851 5,808 Total property, plant and equipment 52,760 51,373 Intangible assets 693 718 Investments and other assets Investment securities 12,184 14,464 Retirement benefit assets 6 5 Other 1,238 1,222 Allowance for doubtful accounts (10) (11) Total investments and other assets 13,417 15,681 Total non-current assets 66,871 67,773 Total assets 131,314 140,726
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- 5 - (Millions of yen) As of March 31, 2026 As of June 30, 2026 Liabilities: Current liabilities Notes and accounts payable—trade 7,740 7,420 Electronically recorded obligations—operating 1,620 3,816 Short-term borrowings 2,569 7,250 Current portion of long-term borrowings 9,399 9,128 Income taxes payable 1,191 1,701 Provision for loss on disaster 92 91 Other 5,121 5,396 Total current liabilities 27,734 34,805 Non-current liabilities Long-term borrowings 27,314 25,441 Deferred tax liabilities 1,048 1,461 Provision for retirement benefits for directors (and other officers) 168 171 Provision for share awards for directors (and other officers) 56 61 Retirement benefit liability 214 270 Other 528 572 Total non-current liabilities 29,330 27,978 Total liabilities 57,064 62,784 Net assets: Shareholders' equity Capital 2,877 2,877 Capital surplus 1,859 1,859 Retained earnings 57,285 59,888 Treasury shares (159) (159) Total shareholders' equity 61,863 64,466 Accumulated other comprehensive income Valuation difference on available-for-sale securities 6,106 7,677 Foreign currency translation adjustment 2,913 2,475 Remeasurements of defined benefit plans 1,514 1,487 Total accumulated other comprehensive income 10,533 11,640 Non-controlling interests 1,852 1,835 Total net assets 74,249 77,941 Total liabilities and net assets 131,314 140,726
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- 6 - (2) Consolidated statement of income and consolidated statement of comprehensive income Consolidated statement of income (Millions of yen) From April 1, 2025 to June 30, 2025 From April 1, 2026 to June 30, 2026 Net sales 15,143 19,774 Cost of sales 11,879 12,976 Gross profit 3,263 6,797 Selling, general and administrative expenses 2,483 2,818 Operating profit 779 3,979 Non-operating profit Interest income 6 9 Dividend income 212 242 Foreign exchange gains - 437 Other 50 56 Total non-operating profit 268 746 Non-operating expenses Interest expenses 113 135 Foreign exchange losses 30 - Loss on valuation of derivatives 144 - Other 16 16 Total non-operating expenses 304 151 Ordinary profit 743 4,573 Extraordinary losses Loss on retirement of non-current assets 10 12 Total extraordinary losses 10 12 Profit before income taxes 733 4,560 Income taxes payable 182 1,315 Profit 551 3,245 Profit attributable to non-controlling interests 20 10 Profit attributable to owners of parent 531 3,235
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- 7 - Consolidated Statement of Comprehensive Income (Millions of yen) From April 1, 2025 to June 30, 2025 From April 1, 2026 to June 30, 2026 Profit 551 3,245 Other comprehensive income Valuation difference on available-for-sale securities 207 1,563 Foreign currency translation adjustment (1,004) (435) Remeasurements of defined benefit plans (89) (27) Total other comprehensive income (886) 1,100 Comprehensive income (335) 4,346 Comprehensive income attributable to: Owners of parent (336) 4,341 Non-controlling interests 0 4
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- 8 - (3) Notes to the consolidated financial statements (Special accounting for preparing quarterly consolidated financial statements) Tax expenses are calculated by multiplying profit before income taxes by the reasonably estimated effective tax rate after th e application of tax effect accounting to profit before income taxes for the fiscal year ending March 31, 2027, including the f irst quarter. However, in cases where calculating tax expenses using the estimated effective tax rate would significantly lack rationality, tax expenses are calculated using the statutory effective tax rate. (Segment information) I. From April 1, 2025 to June 30, 2025 1. Information on net sales, profit or loss by reportable segment (Millions of yen) Reportable segment Adjustment (Note 1) Amount recorded on the statement of income (Note 2) Fundamental Chemicals Fine Chemicals Ferrochemicals Commercial Business Facilities Total Net sales (1) Net sales to external customers 1,963 11,943 533 175 526 15,143 － 15,143 (2) Inter-segment net sales or transfers － － 0 287 525 812 (812) － Total 1,963 11,943 533 462 1,052 15,955 (812) 15,143 Segment profit 39 577 67 49 46 780 (1) 779 (Notes) 1. The segment loss adjustment of –¥1 million is elimination of inter-segment transactions. 2. Segment profit is adjusted with operating profit in the consolidated statement of income. 2. Information about impairment loss and goodwill on non-current assets by reportable segment Not applicable. II. From April 1, 2026 to June 30, 2026 1. Information on net sales, profit or loss by reportable segment (Millions of yen) Reportable segment Adjustment (Note 1) Amount recorded on the statement of income (Note 2) Fundamental Chemicals Fine Chemicals Ferrochemicals Commercial Business Facilities Total Net sales (1) Net sales to external customers 2,082 16,518 550 209 412 19,774 － 19,774 (2) Inter-segment net sales or transfers － － 0 268 411 680 (680) － Total 2,082 16,518 550 478 824 20,454 (680) 19,774 Segment profit (loss) 71 3,752 104 39 (15) 3,953 26 3,979 (Notes) 1. The segment profit (loss) adjustment of ¥26 million is elimination of inter-segment transactions. 2. Segment profit (loss) is adjusted with operating profit in the consolidated statement of income. 2. Information about impairment loss and goodwill on non-current assets by reportable segment Not applicable.
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- 9 - (Notes on significant changes in the amount of shareholders’ equity) Not applicable. (Notes on premise of going concern) Not applicable. (Notes on statement of cash flows) A quarterly consolidated cash flow statement for the first quarter has not been prepared. Depreciation expenses (including amortization expenses related to intangible assets) for the first quarter are as follows. (Millions of yen) From April 1, 2025 to June 30, 2025 From April 1, 2026 to June 30, 2026 Depreciation 1,882 2,315