Interim report
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Accounting St Summary of Consolidated Financial Results for First Quarter of FY2026 1. Summary of Operating Results 1st Q of FY2025 1st Q of FY2026 Incr . ( Decr . ) FY2025 FASF MEMBERSHIP Aug 5 , 2026 Mitsui Chemicals , Inc. ( Unit : Billions of Yen ) Outlook for FY2026 ( announced Aug. 5 ) First half Sales revenue 415.4 460.0 44.6 1,668.8 957.0 Operating income before special items 26.6 50.1 23.5 100.0 76.0 Operating income 12.8 48.4 35.6 73.8 66.0 Net income 5.7 37.3 31.6 46.9 45.0 Net income attributable to owners of the parent 0.7 32.1 31.4 34.4 34.0 Exchange rate Domestic standard naphtha price Yen / US $ 145 159 14 151 160 Yen / KL 66,400 118,900 52,500 65,300 104,500 2. Sales Revenue and Operating Income ( loss ) before Special Items by Business Segment ⚫Sales revenue 1st Q of FY2025 1st Q of FY2026 Incr . ( Decr . ) Breakdown FY2025 ( Unit Billions of Yen ) Outlook for FY2026 ( announced Aug. 5 ) Volume Price First half Life & Healthcare Solutions 56.3 62.2 5.9 2.7 3.2 259.1 125.0 Mobility Solutions 130.2 142.5 12.3 ( 2.0 ) 14.3 515.4 295.0 ICT Solutions 69.0 77.8 8.8 1.7 7.1 279.5 160.0 Specialty chemicals domains 255.5 282.5 27.0 2.4 24.6 1,054.0 580.0 Basic & Green Materials 156.2 173.6 17.4 ( 18.8 ) 36.2 599.9 370.0 Others 3.7 3.9 0.2 0.2 14.9 7.0 Total 415.4 460.0 44.6 ( 16.4 ) 61.0 1,668.8 957.0 • Operating income ( loss ) before special items 1st Q of 1st Q of Incr . FY2025 FY2026 ( Decr . ) Volume Breakdown Price X Fixed Costs FY2025 ( Unit Billions of Yen ) Outlook for FY2026 ( announced Aug. 5 ) etc. First half Life & Healthcare Solutions 6.2 6.8 0.6 2.1 ( 0.5 ) ( 1.0 ) 34.2 13.0 Mobility Solutions 14.6 14.8 0.2 ( 1.2 ) 2.4 ( 1.0 ) 51.0 30.0 ICT Solutions 9.0 11.1 2.1 1.7 1.0 ( 0.6 ) 36.9 23.0 Specialty chemicals domains 29.8 32.7 2.9 2.6 2.9 ( 2.6 ) 122.1 66.0 Basic & Green Materials ( 2.9 ) 19.8 22.7 ( 2.3 ) 20.0 5.0 ( 18.4 ) 15.0 Others ( 0.2 ) ( 0.0 ) 0.2 0.2 ( 0.1 ) ( 3.0 ) Adjustment ( 0.1 ) ( 2.4 ) ( 2.3 ) ( 2.3 ) ( 3.6 ) ( 2.0 ) Total 26.6 50.1 23.5 0.3 22.9 0.3 100.0 76.0 Price includes both selling and purchasing price variances . 3. Summary of Statement of Financial Position ( Unit Billions of Yen ) Assets Liabilities and Equity As of Mar. 31 , 2026 As of Jun . 30 , 2026 Incr . ( Decr . ) As of Mar. 31 , As of Jun . 30 , Incr . ( Decr . ) 2026 2026 Current assets 993.2 1,112.5 119.3 Interest - bearing debt 795.8 876.4 80.6 Property , plant and equipment 720.8 712.9 ( 7.9 ) Other liabilities 367.1 388.3 21.2 & right - of - use assets Equity attributable to owners of Goodwill and intangible assets 98.0 97.2 ( 0.8 ) 864.7 873.2 8.5 the parent Other non - current assets 339.7 339.7 0.0 Non - controlling interests 124.1 124.4 0.3 Total assets 2,151.7 2,262.3 110.6 Total liabilities and equity 2,151.7 2,262.3 110.6 [ Net D / E Ratio ] 0.70 0.75 0.05
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4. Summary of Statement of Cash Flows （Unit : Billions of Yen) Outlook for FY2026 (announced Aug. 5) First half 45.4 14.0 (31.4) 213.0 94.0 (24.7) (29.2) (4.5) (134.8) (206.5) 20.7 (15.2) (35.9) 78.2 (112.5) (8.8) 47.1 55.9 (75.9) 89.0 (2.0) 2.8 4.8 10.2 0.0 9.9 34.7 24.8 12.5 (23.5) 180.5 217.8 37.3 183.1 5. Dividends 6. Number of Shares Outstanding (common stock) On January 1, 2026, the Company conducted a two-for-one stock split of its common shares. 1st Q of FY2025 1st Q of FY2026 Incr. (Decr.) Cash flows from operating activities The total annual dividend per share for the FY2025 is not stated because the interim dividend and the year-end dividend cannot be simply added together due to the stock split. If the stock split is taken into account, the interim dividend per share for FY2025 would be 37.50 yen, and the total annual dividend would be 75.00 yen. The average number of shares has been calculated assuming that the stock split was conducted at the beginning of the FY2025. FY2025 Net incr.(decr.) in cash and cash equivalents Cash flows from investing activities Free cash flows Cash flows from financing activities Others On January 1, 2026, Mitsui Chemicals, Inc. (hereinafter the “Company”) conducted a two-for-one stock split of its common shares. The above dividend per share for the second quarter of the FY2025 is the amounts before the stock split. Cash and cash equivalents at the end of period 1st QInterim(2nd Q)3rd QYear-end(4th Q)Annual TotalFY2025 Result－75.00－37.50－FY2026 Forecast－37.50－37.50 75.00Annual Dividends per Share (yen)1st Q ofFY2026Number of shares outstanding at term-end (including treasury stock) 401,687,630 401,687,630Number of shares of treasury stock at term-end 33,588,357 40,194,231Average number of shares 374,680,934 361,498,549※1st Q of FY2025FY2025 ※
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1. Operating Results (1) Overview In the fiscal period under review (the three-month period from April 1, 2026 to June 30, 2026, hereinafter the "first quarter"), economic recovery continued moderately worldwide. Meanwhile, the pace of recovery in some countries and regions has slowed amid weak demand and U.S. trade policies. In addition, uncertainty regarding energy supplies and international logistics persisted due to instability in the Middle East driven by military conflicts between the United States and Iran. In Japan, economic activity continued to recover moderately, supported by improvements in employment and income conditions. However, uncertainty remained due to the impact of U.S. trade policies and instability in the Middle East. The Mitsui Chemicals Group (hereinafter the “Group”) reported the operating results for the first quarter as follows. The Group employs operating income before special items , which stands for operating income excluding non -recurring items (e.g., losses resulting from withdrawing from and/or downsizing businesses), as a management indicator. (Billions of Yen) Sales Revenue Operating Income before Special Items Operating Income Net Income Attributable to Owners of the Parent First Quarter 460.0 50.1 48.4 32.1 Same period of previous fiscal year 415.4 26.6 12.8 0.7 Difference 44.6 23.5 35.6 31.4 Difference (%) 10.8 88.4 279.8 4,302.3 Sales revenue was 460.0 billion yen, an increase of 44.6 billion yen, or 10.8%, year on year. This result was mainly due to the increase in selling prices, which result ed from rising raw material prices, such as naphtha, and the impact of exchange rate differences. Operating income before special items was 50.1 billion yen, a n increase of 23.5 billion yen, or 88.4%, year on year. This result was mainly due to the improved inventory revaluation gain and loss resulting from rising raw material prices, such as naphtha. Operating income was 48.4 billion yen, an increase of 35.6 billion yen, or 279.8%, year on year. This result was mainly due to the increase in operating income before special items. Financial income/expenses improved 2.1 billion yen year on year to a 0.7 billion yen loss. As a result of the aforementioned factors, income before income taxes amounted to 47.7 billion yen, an increase of 37.7 billion yen, or 379.3%, year on year. Net income attributable to owners of the parent after accounting for income taxes and non-controlling interests was 32.1 billion yen, an increase of 31.4 billion yen, or 4,302.3%, year on year. Basic earnings per share for the period amounted to 88.78 yen. - 1 -
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(2) Results by Business Segment The status of each segment during the first quarter is as follows. Life & Healthcare Solutions Sales revenue increased 5.9 billion yen compared with the corresponding period of the previous fiscal year to 62.2 billion yen and comprised 13% of total sales. Operating income before special items increased 0.6 billion yen to 6.8 billion yen year on year. This result was mainly due to the healthy sales in vision care materials and agrochemicals. In vision care materials, sales were healthy for ophthalmic lens materials. In oral care materials, sales remained at the same level as the corresponding period of the previous fiscal year. In addition, fixed costs were reduced through business restructuring. In agrochemicals, sales were healthy. Mobility Solutions Sales revenue increased 12.3 billion yen compared with the corresponding period of the previous fiscal year to 142.5 billion yen and comprised 31% of total sales. Operating income before special items increased 0.2 billion yen to 14.8 billion yen year on year. This was mainly due to the improved terms of trade by exchange rate differences, despite a decrease in sales due to instability in the Middle East and an increase in fixed costs such as depreciation associated with capacity expansion. In elastomers, sales decreased compared to the corresponding period of the previous fiscal year. In addition, fixed costs, such as depreciation, increased due to capacity expansion. In polypropylene compounds, sales remained at the same level as the corresponding period of the previous fiscal year, while terms of trade improved due to exchange rate differences. In solutions business, sales decreased compared to the corresponding period of the previous fiscal year. On the other hand , fixed costs were reduced through business restructuring. ICT Solutions Sales revenue increased 8.8 billion yen compared with the corresponding period of the previous fiscal year to 77.8 billion yen and comprised 17% of total sales. Operating income before special items increased 2.1 billion yen to 11.1 billion yen year on year. This was mainly due to healthy sales in semiconductor & optical materials and ICT films & sheets, as well as the improved terms of trade by exchange rate differences. In semiconductor & optical materials, sales were healthy. In coatings & engineering materials , sales remained at the same level as the corresponding period of the previous fiscal year. In ICT films & sheets, sales were healthy. In nonwovens, sales remained at the same level as the corresponding period of the previous fiscal year. Basic & Green Materials Sales revenue increased 17.4 billion yen compared with the corresponding period of the previous fiscal year to 173.6 billion yen and comprised 38% of total sales. Operating income before special items increased 22.7 billion yen, resulting in 19.8 billion yen. This was mainly - 2 -
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due to the improved inventory revaluation gain and loss resulting from the rising raw material prices, such as naphtha, despite weak sales. In addition, lower fixed costs through business restructuring and increased share of profit of investments accounted for using equity method also contributed to the improvement in operating income before special items. In phenols, sales decreased compared with the same period of the previous fiscal year. On the other hand, fixed costs improved through business restructuring. In polyolefin, sales remained at the same level as the corresponding period of the previous fiscal year. Naphtha cracker operating rates remained low mainly due to adjusting operations resulting from instability in the Middle East. Others Sales revenue increased 0.2 billion yen compared with the corresponding period of the previous fiscal year to 3.9 billion yen and comprised 1% of total sales. Operating loss before special items improved 0.2 billion yen to 0.0 billion yen year on year. 2. Financial Position (1) Status of Assets, Liabilities and Net Assets Total assets at the end of the first quarter stood at 2,262.3 billion yen, an increase of 110.6 billion yen compared with the previous fiscal year-end. Total liabilities at the end of the first quarter increased 101.8 billion yen compared with the previous fiscal year -end to 1,264.7 billion yen. Interest-bearing debt amounted to 876.4 billion yen, an increase of 80.6 billion yen compared with the previous fiscal year-end. As a result, the interest-bearing debt ratio was 38.7%, an increase of 1.7 percentage point. Total equity was 997.6 billion yen, an increase of 8.8 billion yen compared with the previous fiscal year-end. The ratio of equity attributable to owners of the parent was 38.6%, a decrease of 1.6 percentage point. Accounting for the aforementioned factors, the net debt-equity ratio stood at 0. 75 at the end of the first quarter, a 0.05 percentage point increase from the previous fiscal year-end. (2) Cash Flow Status Cash and cash equivalents (hereinafter "net cash") at the end of the first quarter increased 34.7 billion yen to 217.8 billion yen compared with the previous fiscal year-end. Cash Flows from Operating Activities Net cash provided by operating activities decreased 31.4 billion yen to 14.0 billion yen , compared with the same period of the previous fiscal year , due to a n increase in working capital. Cash Flows from Investing Activities Net cash used in investing activities increased 4.5 billion yen to 29.2 billion yen, compared with the same period of the previous fiscal year, due to a decrease in proceeds from sale and redemption of investment securities. Cash Flows from Financing Activities Net cash provided by investing activities was 47.1 billion yen, compared with a n 8.8 billion yen expenditure in the same period of the previous fiscal year, due to an increase in borrowings of interest-bearing debt. - 3 -
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3. Outlook for Fiscal 2026 (Year Ending March 31, 2027) (1) Overview Regarding the financial forecast for the first half, which had been left undecided, in light of the first quarter results, the Group decided to announce the forecast based on the current available information and predictions. Revised financial forecasts are based on the following assumptions: a) Exchange rate is 160 yen/USD for the first half b) Average price of domestic naphtha is 104,500 yen/KL for the first half Outlook for the full year is unchanged from the previous announcement. Revisions of Financial Forecasts for the First Half Chart (Apr. 1, 2026 - Sept. 30, 2026) (Billions of Yen) Sales Revenue Operating Income before Special Items Operating Income Net Income Net Income Attributable to Owners of the Parent Basic Earnings per Share (yen) Previous forecast (A) - - - - - - Revised forecast (B) 957.0 76.0 66.0 45.0 34.0 94.05 Difference (B-A) - - - - - Difference (%) - - - - - (Reference) FY2025 First Half Actual (Apr. 1 - Sept. 30, 2025) 813.6 44.5 27.9 15.7 7.8 20.88 Note: On January 1, 2026, Mitsui Chemicals, Inc. (hereinafter the “Company”) conducted a two-for-one stock split of its common shares. Basic earnings per share has been calculated assuming that the stock split had been conducted at the beginning of the FY2025. (2) Business Segment Forecast by business segment is as follows. (Billions of Yen) Sales Revenue Life & Healthcare Solutions Mobility Solutions ICT Solutions Basic & Green Materials Others Adjustment Total First half 125.0 295.0 160.0 370.0 7.0 - 957.0 (Billions of Yen) Operating Income before Special Items Life & Healthcare Solutions Mobility Solutions ICT Solutions Basic & Green Materials Others Adjustment Total First half 13.0 30.0 23.0 15.0 (3.0) (2.0) 76.0 - 4 -
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FY2025 As of March 31, 2026 FY2026 As of June 30, 2026 Assets Current assets Cash and cash equivalents 183,113 217,840 Trade receivables 327,640 349,600 Inventories 414,466 467,246 Other financial assets 34,749 39,831 Other current assets 33,191 38,001 Total current assets 993,159 1,112,518 Non-current assets Property, plant and equipment 672,745 665,626 Right-of-use assets 48,039 47,246 Goodwill 24,782 25,042 Intangible assets 73,195 72,115 Investment property 21,744 21,744 Investments accounted for using equity method 156,208 159,010 Other financial assets 99,075 100,553 Retirement benefit assets 48,339 44,885 Deferred tax assets 5,382 5,220 Other non-current assets 8,984 8,347 Total non-current assets 1,158,493 1,149,788 Total assets 2,151,652 2,262,306 4. Consolidated Statement of Financial Position Millions of yen - 5 -
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FY2025 As of March 31, 2026 FY2026 As of June 30, 2026 Liabilities and equity Liabilities Current liabilities Trade payables 133,628 176,637 Bonds and borrowings 296,727 383,778 Income taxes payable 6,075 10,883 Other financial liabilities 103,361 90,823 Provisions 1,857 1,773 Other current liabilities 49,453 39,036 Total current liabilities 591,101 702,930 Non-current liabilities Bonds and borrowings 443,464 438,184 Other financial liabilities 53,017 51,963 Retirement benefit liabilities 16,926 16,384 Provisions 7,297 5,221 Deferred tax liabilities 50,879 49,847 Other non-current liabilities 184 192 Total non-current liabilities 571,767 561,791 Total liabilities 1,162,868 1,264,721 Equity Share capital 125,738 125,738 Capital surplus 51,100 51,228 Treasury stock (56,991) (69,772) Retained earnings 626,617 643,019 Other components of equity 118,263 123,034 Total equity attributable to owners of the parent 864,727 873,247 Non-controlling interests 124,057 124,338 Total equity 988,784 997,585 Total liabilities and equity 2,151,652 2,262,306 Millions of yen - 6 -
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(Consolidated Statement of Income) FY2025 FY2026 April 1, 2025 to June 30, 2025 April 1, 2026 to June 30, 2026 Sales revenue 415,350 460,046 Cost of sales (321,626) (343,591) Gross profit 93,724 116,455 Selling, general and administrative expenses (71,015) (73,391) Other operating income 544 755 Other operating expenses (14,861) (2,335) Share of profit of investments accounted for using equity method 4,361 6,948 Operating income 12,753 48,432 Financial income 1,856 2,568 Financial expenses (4,656) (3,292) Income before income taxes 9,953 47,708 Income tax expense (4,275) (10,449) Net income 5,678 37,259 Net income attributable to: Owners of the parent 729 32,093 Non-controlling interests 4,949 5,166 Net income 5,678 37,259 Earnings per share Basic earnings per share (Yen) 1.95 88.78 (Consolidated Statement of Comprehensive Income) FY2025 FY2026 April 1, 2025 to June 30, 2025 April 1, 2026 to June 30, 2026 Net income 5,678 37,259 Other comprehensive income 2,466 (117) 1,873 (2,083) 25 (17) 4,364 (2,217) (6,230) 5,918 2 1,045 (4,058) (1,633) (10,286) 5,330 (5,922) 3,113 Comprehensive income (244) 40,372 Owners of the parent (4,329) 34,977 Non-controlling interests 4,085 5,395 Comprehensive income (244) 40,372 Comprehensive income attributable to: Exchange differences on translation of foreign operations Effective portion of net change in fair value of cash flow hedges Share of other comprehensive income of investments accounted for using equity method Total of items that may be reclassified to profit or loss 5. Consolidated Statement of Income and Consolidated Statement of Comprehensive Income Millions of yen Total other comprehensive income, net of tax Share of other comprehensive income of investments accounted for using equity method Financial assets measured at fair value through other comprehensive income Items that will not be reclassified to profit or loss Millions of yen Total of items that will not be reclassified to profit or loss Items that may be reclassified to profit or loss Remeasurements of defined benefit plans - 7 -
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6. Consolidated Statement of Cash Flows FY2025 FY2026 April 1, 2025 to June 30, 2025 April 1, 2026 to June 30, 2026 Net cash provided by (used in) operating activities Income before income taxes 9,953 47,708 Depreciation and amortization 25,450 28,676 Impairment loss 12,390 1,399 Interest and dividend income (1,601) (1,658) Interest expenses 2,013 2,139 Share of loss (profit) of investments accounted for using equity method (4,361) (6,948) Decrease (increase) in trade receivables 33,968 (20,313) Decrease (increase) in inventories 7,722 (50,906) Increase (decrease) in trade payables (13,452) 41,606 Increase (decrease) in accrued expenses (4,853) (5,198) Other (16,663) (16,012) Subtotal 50,566 20,493 Interest and dividends received 2,743 2,754 Proceeds from insurance income 97 81 Interest paid (1,882) (2,509) Income taxes refund (paid) (6,086) (6,782) Net cash provided by (used in) operating activities 45,438 14,037 Net cash provided by (used in) investing activities Purchase of property, plant and equipment (27,300) (26,439) Proceeds from sale of property, plant and equipment 17 217 Purchase of intangible assets (3,096) (1,085) Proceeds from sale of intangible assets 1 － Purchase of investment securities (315) (1,784) Proceeds from sale and redemption of investment securities 4,236 469 Payments for acquisition of subsidiaries (3,705) － Proceeds from sale of subsidiaries 5,448 － Proceeds from sale of equity accounted investments － 404 Other 3 (1,020) Net cash provided by (used in) investing activities (24,711) (29,238) Millions of yen - 8 -
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FY2025 FY2026 April 1, 2025 to June 30, 2025 April 1, 2026 to June 30, 2026 Net cash provided by (used in) financing activities Increase (decrease) in short-term borrowings 8,421 50,268 Increase (decrease) in commercial papers 11,000 52,000 Proceeds from long-term borrowings 2,892 － Repayments of long-term borrowings (1,255) (6,028) Redemption of bonds (10,000) (15,000) Repayments of lease liabilities (2,227) (2,424) Proceeds from sale of treasury stock 0 0 Purchase of treasury stock (3) (12,781) Dividends paid (14,051) (13,804) Capital contribution from non-controlling interests － 5 Dividends paid to non-controlling interests (3,537) (5,148) Net cash provided by (used in) financing activities (8,760) 47,088 Effect of exchange rate change on cash and cash equivalents (2,071) 2,840 Net increase (decrease) in cash and cash equivalents 9,896 34,727 Cash and cash equivalents at beginning of period 170,615 183,113 Cash and cash equivalents at end of period 180,511 217,840 Millions of yen - 9 -
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7. Basis of Preparation (1) Overview of Reportable Segments Major products manufactured and sold by business segments are as follows: Life & Healthcare Solutions Mobility Solutions ICT Solutions Basic & Green Materials Others Others (2) Methods to Determine Sales Revenue, and Income or Loss by Reportable Business Segment The Group's business segments are the components for which separate financial information is available and that are regularly reviewed by the Board of Directors (chief operating decision maker) to make decisions about management resources to be allocated to the segments and assess their performance. The Group positions business sector distinguished by their products and services within its headquarters. Each business sector proposes comprehensive domestic and overseas strategies in addition to pursuing business expansion in its respective product and service area. Comprehensively considering similarities such as the details of products and services and target markets, the four reportable segments (distinguished by products and services) that comprise the Group's operations without aggregating the business segments are: Life & Healthcare Solutions, Mobility Solutions, ICT Solutions, and Basic & Green Materials. Business segments, which are not included in the reportable segments, are classified into “Others.” Materials and components for semiconductor and electronic component manufacturing processes, optical materials, nonwoven fabrics, lithium-ion battery materials, next-generation battery materials, and high-performance food packaging materials Elastomers, performance compounds, polypropylene compounds, and comprehensive services regarding to the development of automotive and industrial products (Solution business) Reportable segment income is presented in operating income before special items which stands for operating income excluding non-recurring items (e.g., losses resulting from withdrawing from and/or downsizing businesses) . Intersegment transaction pricing and transfer pricing are negotiated and determined based on prevailing market prices. Ethylene, propylene, polyethylene, polypropylene, catalysts, phenols, PTA, PET, polyurethane materials, and industrial chemical products Other related businesses, etc. Segments Major Products and Businesses Vision care materials, oral care materials, personal care materials, and agrochemicals The Group's quarterly consolidated financial statements have been prepared in accordance with Article 5, Paragraph 2 of the Standards for the Preparation of Quarterly Financial Statements of the Tokyo Stock Exchange, Inc. (the Standards), applying the provisions for reduced disclosures as set forth in Article 5, Paragraph 5 of the Standards, accordingly certain disclosures and notes required by IAS 34 are not given. 8. Segment Information Reportable Segments - 10 -
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(3) Information concerning Sales Revenue, and Income or Loss by Reportable Business Segment Same period of previous fiscal year (April 1, 2025 – June 30, 2025) (Millions of yen) Notes: First quarter (April 1, 2026 – June 30, 2026) (Millions of yen) Notes: (4) (Millions of yen) Total reportable segment income 26,614 50,129 Impairment loss (12,390) (1,399) Loss on disposal of non-current assets (470) (536) Loss on related business (891) (38) Other (110) 276 Operating income 12,753 48,432 Financial income 1,856 2,568 Financial expenses (4,656) (3,292) Income before income taxes 9,953 47,708 1. “Others” encompasses business segments not included in the reportable segments and includes other related businesses, etc. 2. The negative 113 million yen in adjustments to segment income includes corporate loss of 46 million yen not allocated to reportable segments and negative 67 million yen elimination of intersegment transactions. Corporate profit (loss) mainly comprise general & administrative expenses and R&D expenses for new business which are usually not attributed to segments, and allocation difference of general & administrative expenses to be borne by segments. 2. The negative 2,342 million yen in adjustments to segment income includes corporate loss of 1,599 million yen not allocated to reportable segments and negative 743 million yen elimination of intersegment transactions. Corporate profit (loss) mainly comprise general & administrative expenses and R&D expenses for new business which are usually not attributed to segments, and allocation difference of general & administrative expenses to be borne by segments. First quarter (April 1, 2026 – June 30, 2026) Adjustments from segment income to income before income taxes Same period of previous fiscal year (April 1, 2025 – June 30, 2025) 1. “Others” encompasses business segments not included in the reportable segments and includes other related businesses, etc. Life & Healthcare Solutions Mobility Solutions ICT Solutions Basic & Green Materials Total Sales revenue 1) 56,251 130,219 69,012 156,159 411,641 3,709 － 415,350 2) 1,060 852 1,263 18,621 21,796 16,573 (38,369) － Total 57,311 131,071 70,275 174,780 433,437 20,282 (38,369) 415,350 6,190 14,550 9,046 (2,886) 26,900 (173) (113) 26,614 Reportable Segment Segment income (loss) (Operating income before special items) Others (Note 1) Adjustment (Note 2) Consolidated External customers Intersegment Life & Healthcare Solutions Mobility Solutions ICT Solutions Basic & Green Materials Total Sales revenue 1) 62,181 142,568 77,774 173,609 456,132 3,914 － 460,046 2) 1,051 838 2,436 27,059 31,384 16,490 (47,874) － Total 63,232 143,406 80,210 200,668 487,516 20,404 (47,874) 460,046 6,757 14,778 11,097 19,842 52,474 (3) (2,342) 50,129 Intersegment Segment income (loss) (Operating income before special items) Others (Note 1) Adjustment (Note 2) External customers Consolidated Reportable Segment - 11 -
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9. Subsequent Events (Integrate Polyolefin Business in Japan) Prime Polymer Co., Ltd. ( hereinafter “PRM”), a consolidated subsidiary of the Company commenced on July 1, 2026 a business integration (hereinafter the “Business Integration”) of Sumitomo Chemical Co., Ltd.’s ( hereinafter “Sumitomo Chemical”) domestic polypropylene (“PP”) and linear low-density polyethylene (“LLDPE”) businesses into PRM. The Business Integration follows the memorandum of understanding dated September 10, 2025 and the definitive agreements executed on December 24, 2025, and was implemented after completion of the necessary procedures with the relevant authorities. (1) Outline of business combinations a) Description of the Businesses Subject to the Business Integration Sumitomo Chemical’s domestic PP business and LLDPE business (hereinafter, the “Subject Businesses”) b) Primary reason for business combinations Since its establishment in 2005 as a joint venture between the Company and Idemitsu Kosan Co., Ltd. (hereinafter “Idemitsu ”), PRM has been a leader in the Japanese polyolefin (“PO”) industry, with PP, LLDPE, and high-density polyethylene as its main products. PRM and Sumitomo Chemical have a shared understanding that integrating the Subject Businesses into PRM will not only strengthen the domestic PO business but also enhance its competitiveness against imported products. The Business Integration is expected to generate significant synergies both in the production of PRM and Sumitomo Chemical, both having operating bases in the Keiyo region of Japan, and in the development of technologies to reduce environmental impact. Through the Business Integration, the Company, Idemitsu, and Sumitomo Chemical will work together to optimize the PO production system, with the goal of achieving cost savings of more than 8 billion yen per year, thereby further strengthening their competitiveness as resilient and essential companies. Furthermore, by enhancing their capabilities to develop high-performance and environmentally conscious products, the Company, Idemitsu, and Sumitomo Chemical will accelerate efforts to achieve a sustainable green chemical business. c) Method of the Business Integration The Business Integration will be implemented through an absorption -type company split, with Sumitomo Chemical as the Splitting Company and PRM as the Succeeding Company. In order to achieve the Business Integration as swiftly as possible, regarding the method of implementing the Business Integration, they have agreed that Sumitomo Chemical will transfer its businesses subject to the Business Integration to PRM through a two-phase absorption-type split (the first phase of the absorption -type split will hereinafter be referred to as “Absorption -Type Split Phase One,” and the second phase as “Absorption -Type Split Phase Two”). In consideration for Absorption -Type Split Phase One, Sumitomo Chemical will acquire equity shares equivalent to a 20% stake in PRM. As a result, PRM will become a joint venture company in which the Company holds a 52% stake, Idemitsu holds a 28% stake, and Sumitomo Chemical holds a 20% stake. The consideration for Absorption -Type Split Phase Two will be a split value to be separately agreed upon by Sumitomo Chemical and PRM. Regarding the two -phase absorption-type split, the parties have agreed that the first phase will be the implementation of Absorption -Type Split Phase One, in which all of the businesses subjected to the Business Integration, excluding manufacturing functions, will be transferred, and the scheduled system integration preparations at PRM will be completed. Following this, the second phase will be the Absorption -Type Split Phase Two, in which the assets and liabilities, contractual status, and contractual rights and obligations associated with the manufacturing functions of the businesses will be transferred. - 12 -
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d) Effective Date Absorption-Type Split Phase One: July 1, 2026 Absorption-Type Split Phase Two: April 1, 2027 (planned) IFRS 3 “Business Combinations” applie s to the business combination, but since the initially planned accounting procedures were not completed by the release date of the consolidated financial statements, detailed information on the procedures is not stated. (2) Share Allocation Related to the Business Integration Absorption-Type Split Phase One The consideration for Absorption -Type Split Phase One will be the fair value of PRM's common stock delivered on the date of the Business Integration . However, as PRM's fair value measurement has not yet been completed, the amount is omitted. Absorption-Type Split Phase Two: The consideration for Absorption-Type Split Phase Two will be a split value to be separately agreed upon by Sumitomo Chemical and PRM. (3) Assets acquired, liabilities undertaken and goodwill Description is omitted because the fair value measurement of assets acquired, liabilities undertaken, and purchase price allocation have not been completed as of the end of the first quarter. - 13 -