Sakai Chemical ＜4078＞ mainly develops, manufactures, and sells inorganic chemical industrial products, organic chemicals, and pharmaceuticals, and is developing business in two business segments: the chemical business segment and the medical business segment. The products handled by the Group span a wide range of products, from general pharmaceuticals and cold medicines to dielectrics used in multilayer ceramic capacitors, ultrafine zinc oxide/titanium oxide for sunscreen, and organic sulfur compounds used in eyeglass lenses, and the company's products are used in various situations of everyday life. Competitors with an advantage in low prices have entered the chemical industry product market in recent years. Even so, the company is trying to differentiate itself from competitors using the high quality it has cultivated since its establishment as an advantage.

The consolidated cumulative results for the second quarter of the fiscal year ending March 31, 2025 resulted in a significant increase in profit, with sales rising 3.5% from the same period last year to 41874 million yen, and operating profit increasing 186.4% to 2626 million yen. As for sales, the chemical business and medical business both increased sales and strong sales boosted the overall top line. In particular, sales of electronic materials, which the company positions as one of its growth businesses in its medium-term management plan, rapidly increased 43.7% to 5886 million yen. In addition to the fact that sales volume recovered due to a recovery in market conditions, the steady implementation of price revisions contributed to the growth of the top line. In terms of profit, strong electronic materials and titanium oxide, zinc oxide, and resin additives, which are positioned as efficiency review projects, contributed. Electronic materials accumulated profits due to increased sales effects, price revision effects, improvements in operating levels, etc. Profits in the efficiency improvement study business increased due to price revisions, improvements in the degree of operation, etc. In particular, although sales of titanium oxide and zinc products and resin additives declined due to strategies that emphasized profitability, they contributed firmly to an increase in profit on a consolidated basis in terms of profit, and it can be seen that the mid-term budget strategy is progressing smoothly.

The full-year earnings forecast for the fiscal year ending 2025/3 is expected to increase 6.0% from the previous fiscal year in terms of sales and 5400 million yen, an increase of 83.5% in operating income, and there is no change from expectations at the beginning of the fiscal year. Although progress in the organic chemicals, cosmetic materials, and medical businesses was slightly soft as of the end of the first half of the year, it is expected that strong electronic materials and contract processing will drive the expansion of business performance. Note, with regard to the medical business, although it was affected by transient special factors in the first half, the problem has now been resolved. Sales and profits will increase towards the end of the fiscal year. As for dividends, an annual dividend of 125.0 yen per share (expected dividend yield of 4.81%) is planned. Regarding the basic dividend policy, the company has changed from the conventional “using a dividend payout ratio of 30% or more as a guide” to “using DOE 3% or more as a guide.” By adopting DOE, it is our policy to steadily implement shareholder returns in the future.

The company announced “Transformation/BEYOND2030” as a medium- to long-term growth strategy. The same medium-term management plan, which was formulated with backcasting thinking from what the company wants to be in the future, is positioned as a transformation stage for future growth, and the basic policy is to replace business portfolios intended to shift to high value-added products, achieve ROE above capital costs and improve PBR, and rebuild the management infrastructure and accelerate non-financial efforts by promoting materiality. In particular, with regard to portfolio replacement, it is poised to pursue profit accumulation in addition to expanding the top line by boldly implementing business consolidation from the viewpoint of growth potential and profitability. By implementing these basic strategies, we aim to achieve operating income of 9000 million yen and an ROE of 8% for the fiscal year ending 2027/3.