Kanto Denka Kogyo Co., Ltd. · TSE:4047
Kanto Denka Kogyo — FY2024 Earnings Presentation
32 slides from Kanto Denka Kogyo's earnings presentation, May 23, 2025
Slide 1: Financial Results Briefing for the Fiscal Year Ended March 31, 2025
Note: 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. The Company assumes no responsibility for this translation or for direct, indirect o
Slide 2: Contents
Contents 1. Overview of Financial Results for the Fiscal Year Ended March 31, 2025 2. Business Outlook and Future Trends 3. Progress of Medium-Term Management Plan 4. Supplementary Materials © Kanto Denka Kogyo Co., Ltd. All rights reserved. 2
Slide 3: Statement of Income
Statement of Income Net sales decreased by ¥2.4 billion primarily due to a decline in sales of battery materials, largely driven by reduced demand from the slowing EV market growth and a reduction in technical support fees. This was despite increased sales of specialty gases resulting from improve
Slide 4: Balance Sheet
Balance Sheet (Billions of yen) FY2023 FY2024 Difference % change Assets 125.3 123.6 –1.6 –1.3 Cash and deposits 25.4 20.2 –5.1 –20.1 Trade receivables 16.1 15.4 -0.6 –3.9 Inventories 17.4 17.2 –0.1 –0.7 Non-current assets (tangible + intangible) 49.7 55.8 6.0 12.1 Liabilities 59.7 55.9 –3.7 –6.2 In
Slide 5: Fundamental Chemicals Division
Fundamental Chemicals Division (Billions of yen) (Billions of yen) (Billions of yen) FY2023 FY2024 Results Results Difference Net sales 8.8 7.9 -0.8 Operating (0.1) (0.5) -0.4 profit (loss) Net sales Although there was an increase in the sales volume of organic products, net sales declined due to a
Slide 6: Fine Chemicals Division
Fine Chemicals Division (Billions of yen) (Billions of yen) (Billions of yen) FY2023 FY2024 Results Results Difference Net sales 51.2 49.4 -1.7 Operating (2.8) 3.9 6.8 profit (loss) Net sales Net sales decreased due to a decrease in sales volumes and prices of battery materials, along with a reducti
Slide 7: Divisions (Including consolidation adjustments)
Ferrochemicals, Commercial Business, Facilities Divisions (Including consolidation adjustments) (Billions of yen) (Billions of yen) (Billions of yen) FY2023 FY2024 Results Results Difference Net sales 4.6 4.8 0.1 Operating 0.9 0.8 -0.1 profit Net sales Net sales decreased in Facilities Division and
Slide 8: Operating Profit: Difference Analysis (FY2023 vs. FY2024)
Operating Profit: Difference Analysis (FY2023 vs. FY2024) (Billions of yen) ⇧Loss on valuation of inventories (¥3.52 billion in FY2023 / ¥1.13 billion in FY2024) ⇩Consolidation adjustments: –0.77, Subsidiaries: –0.33 Reason for recognition FY2023: Decline in unit prices for lithium compounds FY2024:
Slide 9: Operating Profit and Operating Profit Margin Over Time
Operating Profit and Operating Profit Margin Over Time (Billions of yen) EBITDA margin Operating profit margin Operating profit (loss) © Kanto Denka Kogyo Co., Ltd. All rights reserved. 9
Slide 10: Capital Investment, Depreciation, and Research and Development Expenses Over Time
Capital Investment, Depreciation, and Research and Development Expenses Over Time (Billions of yen) H2 plan H2 plan ■Capital investment ■Depreciation ■ R&D expenses © Kanto Denka Kogyo Co., Ltd. All rights reserved. 10
Slide 11: The Kanto Denka Group (Consolidated Subsidiaries)
The Kanto Denka Group (Consolidated Subsidiaries) (Billions of yen) Share of Net sales: Year-on-year Capital Major business lines investment (%) FY2024 change Sale of chemical products, maintenance Kanden Kosan Co., Ltd. ¥10 mil. 100.0 7.2 –1.1 of containers, insurance agency services Manufacture, p
Slide 12: Business Outlook and Future Trends
1. Overview of Financial Results for the Fiscal Year Ended March 31, 2025 2. Business Outlook and Future Trends 3. Progress of Medium-Term Management Plan 4. Supplementary Materials © Kanto Denka Kogyo Co., Ltd. All rights reserved. 12
Slide 13: Performance Forecast
Performance Forecast Net sales are forecast to increase by ¥5.6 billion, despite the anticipated deferral of technical support fees to future fiscal years, due to price revisions for fundamental chemicals and higher sales volumes of specialty gases, including the KSG series. Operating profit is
Slide 14: Performance Forecast (by Segment)
Performance Forecast (by Segment) (Billions of yen) Net sales Operating profit (loss) FY2024 FY2025 FY2024 FY2025 Difference Difference (results) (forecast) (results) (forecast) Fundamental 7.9 8.5 0.5 (0.5) 0.2 0.7 Chemicals Fine Chemicals 49.4 54.6 5.1 3.9 4.3 0.3 Other* 4.8 4.9 0.0 0.8 0.5 –0.3 T
Slide 15: Operating Profit: Difference Analysis (FY2024 vs. FY2025)
Operating Profit: Difference Analysis (FY2024 vs. FY2025) (Billions of yen) ⇧Specialty gases: Sales volumes up ⇩Battery materials: Technical support fees down ⇧ Loss on valuation of inventories ⇩Fixed costs: –1.25 Result FY2024 : –1.13 ⇧ Consolidation adjustments: +0.35 Forecast FY 2025 :–0.76 © Kan
Slide 16: H1 Forecast vs. Results (by Segment)
H1 Forecast vs. Results (by Segment) (Billions of yen) Net sales Operating profit (loss) FY2024 FY2025 FY2024 FY2025 Difference Difference H1 (results) H1 (forecast) H1 (results) H1 (forecast) Fundamental 3.9 3.9 –0.0 (0.5) 0.0 0.5 Chemicals Fine Chemicals 24.8 26.2 1.3 1.8 1.6 –0.2 Other* 2.4 2.6 0
Slide 17: Operating Profit: Difference Analysis (H1 Forecast vs. Results)
Operating Profit: Difference Analysis (H1 Forecast vs. Results) (Billions of yen) ⇧Specialty gases: Sales volumes up ⇩Battery materials: Technical support fees down ⇧ Loss on valuation of inventories ⇩Fixed costs: –1.20 Result H1 FY2024 : –0.76 ⇧ Consolidation adjustments: +0.36 Forecast H1 FY 2025
Slide 18: H1 Forecast vs. H2 Forecast (by Segment)
H1 Forecast vs. H2 Forecast (by Segment) (Billions of yen) Net sales Operating profit FY2025 FY2025 FY2025 FY2025 Difference Difference H1 (forecast) H2 (forecast) H1 (forecast) H2 (forecast) Fundamental 3.9 4.6 0.7 0.0 0.2 0.2 Chemicals Fine Chemicals 26.2 28.4 2.2 1.6 2.7 1.1 Other* 2.6 2.3 –0.3 0
Slide 19: Operating Profit: Difference Analysis (H1 Forecast vs. H2 Forecast)
Operating Profit: Difference Analysis (H1 Forecast vs. H2 Forecast) (Billions of yen) ⇧ Fixed costs: +1.14 ⇩ Subsidiaries: – 0.04 ⇧Specialty gases: Sales volumes up ⇧ Loss on valuation of inventories （H1: –0.61 H2: -0.14） © Kanto Denka Kogyo Co., Ltd. All rights reserved. 19
Slide 20: Topics (Status of Major Capital Investments)
Topics (Status of Major Capital Investments) FY2025 FY2024 Future H1 H2 Operational from Q3 Hexafluoro-1,3-butadiene Specialty gases (C4F6) 400 t/y 600 t/y Xuancheng KDK Technology Co., Ltd. Equipment installation Certification Sales start Phase II construction: WF6, C4F6, CF4 Mass production equipm
Slide 21: Progress of Medium-Term Management Plan
1. Overview of Financial Results for the Fiscal Year Ended March 31, 2025 2. Business Outlook and Future Trends 3. Progress of Medium-Term Management Plan 4. Supplementary Materials © Kanto Denka Kogyo Co., Ltd. All rights reserved. 21
Slide 22: Recognition of the Current Situation (Progress of Medium-Term Management Plan)
Recognition of the Current Situation (Progress of Medium-Term Management Plan) Net Sales and operating profits did not reach targets in FY2024 Specialty gases progressed generally as planned Battery materials deviated significantly from plan Main reasons are delay of the market recovery and po
Slide 23: Analysis of ROIC (by Segment)
Analysis of ROIC (by Segment) FY2023 FY2024 FY2026 ROIC Results Results Target Fine Chemicals -2.6% 3.2% 10% or more (Specialty Gases) 2.0% 4.1% 10% or more (Battery Materials) -33.1% -12.3% 0% or more Fundamental -1.3% -5.4% 4～6% Chemicals Ferrochemicals 4.7% 8.1% 6～8% Company-wide ROIC -1.8% 3.8%
Slide 24: Direction of Each Business (Fine Chemicals)
Direction of Each Business（Fine Chemicals） Expand Business, Mainly in Fine Chemicals Xuancheng KDK Technology Co., Ltd. PhaseⅡ construction：commenced trial operation in October 2024 (WF6, CF4, C4F6) , Working towards full-scale operation Aim to expand sales in the Chinese market by collaborating
Slide 25: Direction of Each Business (Fundamental Chemicals and Ferrochemicals)
Direction of Each Business （Fundamental Chemicals and Ferrochemicals） Portfolio Reform Although we planed for restructuring business scale such as specializing in supplying raw materials for internal use, we determined that generating a certain profit is necessary at current situation to maintain
Slide 26: Cash Allocation
Cash Allocation 【Results FY2022-2024】 【Image FY2025-2026】 Financing with interest-bearing debt Investing CF Financing with interest-bearing debt Sale of cross-shareholdings Around Around ¥15.8 billion Sale of cross-shareholdings ¥43.4 billion Investing CF Operating CF Operating CF Around ¥31.5 billi
Slide 27: Supplementary Materials
1. Overview of Financial Results for the Fiscal Year Ended March 31, 2025 2. Business Outlook and Future Trends 3. Progress of Medium-Term Management Plan 4. Supplementary Materials © Kanto Denka Kogyo Co., Ltd. All rights reserved. 27
Slide 28: Outlook and Strategy for Specialty Gases
Outlook and Strategy for Specialty Gases The market size of etching and cleaning gases for semiconductor is expected to grow to JPY 330 billion* by 2030. Our CAGR (2024-2030) is assumed to be 11.0% compared to a market average of 6.0%*. *Our forecast Our target share (2030) is at least 25%. Ot
Slide 29: Outlook for Future Battery Materials (LiPF6)
Outlook for Future Battery Materials (LiPF6) We target U.S. and Japanese markets. *Our forecast These two markets are expected to grow to 51,000* tons in 2030. 2030 （27% decline compared to the 2025 Q2 forecast, due to the slowing EV market growth） U.S. and Japan Projected market share by region
Slide 30: Kanto Denka's Technology and Business Direction
Kanto Denka's Technology and Business Direction ■Future SDGs/ESG High-sensitivity LIB materials using Support technologies that are analysis recycled Li cutting- edge on a global stage, Recycling and grow to become an High purity Fine Chemicals innovative, development-driven Fluorination Specialty g
Slide 31: Business Segments
Business Segments Name Products and services Fundamental Inorganic products Caustic soda, hydrochloric acid, sodium hypochlorite, aluminum chloride, etc. Chemicals Organic products Trichloroethylene, perchloroethylene, vinylidene chloride, cyclohexanol, etc. Sulfur hexafluoride, Carbon tetrafluoride
Slide 32: Notes
Notes • This document does not constitute disclosure material as defined by the Financial Instruments and Exchange Act and other laws and regulations, and therefore the Company does not guarantee its accuracy or completeness. • Performance forecasts in this document were created based on information