Five-year summary
|
Fiscal years (ended March 31)
|
| 2017 |
2018 |
2019 |
2020 |
2021 |
| Results of operations (millions of yen) |
| Net sales |
743,028 |
822,858 |
861,456 |
786,083 |
732,851 |
| Operating income |
111,217 |
130,581 |
105,740 |
81,658 |
87,820 |
| Operating income ratio (%) |
15.0 |
15.9 |
12.3 |
10.4 |
12.0 |
| Net income attributable to owners of the parent company |
75,664 |
88,795 |
78,134 |
55,551 |
63,276 |
| R&D expenses |
14,370 |
15,502 |
16,644 |
18,244 |
19,483 |
| Capital expenditures |
37,756 |
39,494 |
64,830 |
61,135 |
50,627 |
| Depreciation and amortization |
29,976 |
29,756 |
31,309 |
32,058 |
37,535 |
| Cash flows (millions of yen) |
|
|
|
|
|
| Cash flows from operating activities |
115,716 |
115,430 |
77,511 |
99,924 |
95,107 |
| Cash flows from investing activities |
-34,724 |
-43,129 |
-63,311 |
-70,336 |
-46,353 |
| Cash flows from financing activities |
-68,829 |
-51,745 |
-26,962 |
-23,964 |
1,585 |
| Cash and cash equivalents at end of year |
85,460 |
106,179 |
92,095 |
97,235 |
148,398 |
| Financial position (millions of yen) |
|
|
|
|
|
| Total assets |
778,746 |
845,748 |
878,194 |
886,592 |
982,776 |
| Total equity |
448,336 |
528,067 |
579,502 |
609,660 |
661,680 |
| Interest-bearing debt |
139,844 |
107,840 |
101,072 |
95,859 |
126,527 |
| Per share data (yen) |
|
|
|
|
|
| Net income per share |
233.12 |
273.49 |
240.62 |
171.03 |
197.89 |
| Total equity per share |
1272.85 |
1,511.69 |
1,665.47 |
1,747.19 |
1,934.86 |
| Dividends per share* |
24.00 |
44.00 |
56.00 |
56.00 |
60.00 |
| Key ratios |
|
|
|
|
|
| Return on equity (%) |
20.1 |
19.6 |
15.1 |
10.0 |
10.7 |
| Return on assets (%) |
9.7 |
10.9 |
9.1 |
6.3 |
6.8 |
| Total assets turnover (times) |
0.95 |
0.97 |
0.98 |
0.89 |
0.75 |
| Equity ratio (%) |
53.1 |
58.0 |
61.6 |
64.0 |
62.6 |
| Dividend payout ratio (%) |
20.6 |
20.5 |
23.3 |
32.7 |
30.3 |
| Debt-to-equity ratio (%) |
80.0 |
64.7 |
55.2 |
48.8 |
52.2 |
| Number of employees (consolidated) |
12,292 |
12,595 |
12,955 |
13,336 |
13,631 |
| Stock indicators |
|
|
|
|
|
| Stock price (closing), end of year (yen) |
978 |
2,088 |
1,721 |
1,230 |
2,118 |
| Market capitalization (millions of yen) |
635,858 |
678,769 |
559,464 |
399,850 |
688,521 |
| Price earnings ratio (times) |
8.4 |
7.6 |
7.2 |
7.2 |
10.7 |
| Price book-value ratio (times) |
1.5 |
1.4 |
1.0 |
0.7 |
1.1 |
Note: For fiscal year 2018, figures account for the one-for-two reverse stock split of common shares executed on October 1, 2017.
Download Tosoh's fiscal 2021 audited financial statements »
Download Tosoh's fiscal 2021 consolidated results release »
Business and other risks
The Tosoh Group identifies and analyzes risks that may have a significant impact on management and takes appropriate measures to minimize the impact of such risks when they become apparent, and implements initiatives to protect corporate value.
Risk assessment system
Under the supervision of the board of directors, the Tosoh Group has established a system in which each department in charge analyzes risks that may have a significant impact on management and responds appropriately. Each department is responsible for implementing risk countermeasures in a systematic manner, as well as for prompt response to crises.
Major risk items
The following is a list of major risks that we recognize as having the potential to significantly impact the Group's financial position, business performance, and cash flow. We have positioned them as important CSR issues and are actively addressing them. Forward-looking statements in the text are based on the judgment of the Tosoh Group as of March 31, 2021.
Climate change
With the adoption of the Paris Accord, efforts are being made worldwide to reduce emissions of greenhouse gases, which are considered to be the major cause of climate change and global warming.
If quantitative restrictions or taxes are introduced in the future in relation to CO2 and other emissions or the use of fossil fuels, or if demand for oil-related products declines due to the emergence of nonfossil-fuel alternatives, the Group's business performance and financial position may be affected. For this reason, the Group has established the CO2 Reduction and Effective Use Promotion Committee to promote technological improvements for CO2 reduction and effective use.
We are also taking measures to adapt our various facilities to withstand extreme weather conditions such as typhoons and floods caused by climate change that may cause damage to production facilities and roads used for transportation.
Environmental and other legal regulations
The Tosoh Group's business performance and financial position may be affected by restrictions on business activities, additional capital investment, or new expenses due to the strengthening of domestic and international legal regulations concerning the environment or other matters, or due to demands for social responsibility. For this reason, the Tosoh Group conducts its business activities with the recognition that environmental protection and health and safety and the like are management issues of the highest priority.
Technological innovation
In the midst of rapid changes in the domestic industrial structure and international social issues, if we are unable to continuously develop and provide new products that meet customer needs, or if groundbreaking technological innovations are made by competitors, our business performance and financial position may be adversely affected. Given these risks, the Tosoh Group is actively engaged in R&D to strengthen and expand its core businesses and create new products and opportunities for the sustainable growth of the company.
Especially in the Specialty products business, the speed of technological innovation is remarkable. This is why we believe it is necessary to develop and provide new products in a timely manner. We have positioned creating and providing products and services that solve social issues and contribute to society as a key CSR objective.
Intellectual property
In the course of developing a wide range of businesses, there is a possibility that the Group's intellectual property rights or those held by third parties may be infringed upon. In such a case, the Group's business performance and financial position may be affected, requiring technological innovation through R&D. The Tosoh Group recognizes the importance of intellectual property rights, and is working to acquire rights and prevent infringement of rights held by third parties, both in Japan and overseas.
Information security
If a problem were to occur in the plant control systems or core systems at our manufacturing complexes, we would be forced to suspend important operations, which could have an impact on our business performance and financial position. The Tosoh Group has taken various protective measures against cyberattacks.
In the event that information is leaked to outside parties due to unforeseen circumstances, the Tosoh Group’s public trust and competitiveness could be compromised. This could affect the Group's business performance and financial position. Given this risk, the Group strives to appropriately manage confidential and personal information, and has taken appropriate measures that comply with the European Union General Data Protection Regulation.
Quality issues
Unexpected defects in our products could lead to a loss of public trust, discontinuation of product sales, or even legal action. This could affect the business performance and financial position of our Group. The Tosoh Group has, therefore, established a quality management system for its products and has product liability insurance in place.
Raw material and fuel procurement
Some raw materials and fuels are dependent on specific regions or suppliers. The Group's business performance and financial position may be affected in the event of procurement disruptions due to disasters or accidents at those suppliers. To mitigate this risk, the Group procures raw materials and fuels necessary for production from both domestic and overseas sources. The company is working to ensure stable long-term procurement by diversifying raw material and fuel suppliers, concluding medium- to long-term contracts, and purchasing from the spot market.
Overseas business activities
There are risks from social or political turmoil caused by war, terrorism, or other factors, inadequate social infrastructure, and difficulties in recruiting and securing human resources that can potentially hinder our business activities and negatively impact our business performance and financial position. As such, the Tosoh Group is engaged in a wide range of overseas business activities, including product exports and local production overseas, and is addressing the important CSR issue of diversity and inclusion, with a particular focus on human rights issues related to supply chains.
Other risks are as noted below:
- Occurrence of accidents, disasters, and infectious diseases
- Fluctuations in international market prices for products and fuels
- Changes in inventory valuations
- Shifts in domestic and international economic conditions, supply and demand, and competition
- Issues with acquisitions, capital alliances, and business restructuring
- Fluctuations in exchange rates
- Fluctuations in interest rates
- Capital expenditures
- Litigation
- Impairment in fixed assets
- Valuation of marketable securities
- Reversal of deferred tax assets
- Retirement benefits
- Estimates based on construction progress standards
Response to the COVID-19 pandemic
The Tosoh Group is promoting the prevention of COVID-19 infections in line with its CSR Basic Policy which holds that the safety and health of people involved in its business activities must be ensured.
In Japan, to reduce the possibility of employees becoming infected, we are promoting telecommuting—approximately 70% during periods of state of emergency—and staggered work hours. We are also employing web conferencing in lieu of business trips, meetings, and interviews, and implementing measures such as temperature checks for visitors. COVID-19 infection control offices have been established at the Nanyo and Yokkaichi Complexes, and we are implementing countermeasures using a phased management approach in response to the infection situation.
Major infection prevention measures at manufacturing complexes in Japan (in addition to company-wide measures):
- Temperature check by thermo-camera when entering the workplace
- Disinfection of contact areas after each shift
- Mandatory wearing of masks
- Social distancing with outsiders
- Maintain records of entry and exit at manufacturing complexes, instrument rooms, etc.
- Installation of CO2 meters in temporary periodic maintenance structures to promote ventilation
Workplace vaccination
The Nanyo and Yokkaichi Complexes implemented workplace vaccination programs to reduce the chance of infection among employees and curb the spread of serious diseases.
By conducting vaccination at company workplaces, we contribute to reducing the burden on local governments and accelerating the vaccination process.
Business activity and product contributions
Tosoh is expanding its lineup of reagents for the detection of antibodies to SARS-CoV-2 for our fully automated chemiluminescence enzyme immunoassay analyzers. The reagents contribute to basic and clinical research on COVID-19 infections by facilitating an understanding of the state of immunity after infection or vaccination.