Sumitomo Chemical Co., Ltd. - Announcement of Finance Income, Restructuring Costs, and Extraordinary Loss in Non-consolidated Financial Statements
May 16, 2024 at 09:40 am EDT
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Sumitomo Chemical Co., Ltd. (the 'Company') announces that finance income (foreign exchange income) and restructuring costs were posted in the fourth quarter of the fiscal year 2023 (from January 1, 2024 to March 31, 2024).
In addition, an extraordinary loss was posted in the nonconsolidated financial statements as detailed below.
Posting the Finance Income (Foreign Exchange Income)
In the consolidated financial statements, a foreign exchange income of JPY32,194 million was recorded for the fourth quarter due to recent fluctuations in foreign exchange rates. This was mainly due to the valuation of assets denominated in foreign currencies.
Posting the Restructuring Costs
In the consolidated financial statements, the restructuring costs of JPY22,767 million were posted in 'Other operating expenses' for the fourth quarter. These are expenses mainly related to rationalization costs, including such as headcount reduction that Sumitomo Pharma Co., Ltd., the Company's consolidated subsidiary, carried out in its wholly owned US subsidiary, as well as the property, plant, and equipment costs associated with restructuring the Company's business.
Posting the Extraordinary Loss
In the non-consolidated financial statements, the Company posted a loss of JPY21,421 million for the fourth quarter on a write-down of its investments in subsidiaries due to a substantial decline in the fair value of investments.
Impact on the Financial Results
With regard to the impact of the above finance income and restructuring costs on the results of the Company operations, please refer to the 'Summary of Consolidated Financial Results for Fiscal Year 2023' announced today. The above-mentioned extraordinary loss is recorded only in the Company's non-consolidated financial statements. Since it is eliminated in the consolidated financial statements, there is no impact on consolidated results.
Sumitomo Chemical Co Ltd is one of the Japanese largest chemical groups. The group is also manufacturing and marketing pharmaceutical products. Net sales break down by family of products as follows:
- petrochemical and plastic products (25.8%): ethylene, polyethylene, propylene, elastomers, agricultural films, etc.;
- pharmaceutical products (23.9%): ethic drugs, radiopharmaceutical products, etc.;
- telecommunication chemical products (18.9%): optic films, pigments, filters, etc.;
- agrochemical and fine chemistryproducts (18.5%): insecticides, herbicides, fertilizers, food additives, etc.;
- functional chemical products (10.7%): methanol, caustic soda, aluminum hydroxide, alumina, nitric acid, acrylonitrile, active pharmaceutical ingredients, polymeric additives, resorcine, colorants, etc.;
- other (2.2%).
Net sales break down geographically as follows: Japan (31.7%), China (19.2%), Asia (19.5%), North America (17.7%), Europe (4.2%) and other (7.7%).
SUMITOMO CHEMICAL CO., LTD. 
