Announcement of Finance Income, Restructuring Costs,
and Extraordinary Loss in Non-consolidated Financial Statements

(May 15, 2024) - 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 non-consolidated financial statements as detailed below.

1. Posting the Finance Income (Foreign Exchange Income)

In the consolidated financial statements, a foreign exchange income of ¥32,194 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.

2. Posting the Restructuring Costs

In the consolidated financial statements, the restructuring costs of ¥22,767 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.

3. Posting the Extraordinary Loss

In the non-consolidated financial statements, the Company posted a loss of ¥21,421 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.

4. 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 Chemicals announces reorganization

Sumitomo Chemical has announced that the Company will change its organization as outlined below, effective July 1, 2024.

(Reorganization related to the Essential Chemicals & Plastics Sector)

We will separate the operations related to our Rabigh business from Planning & Coordination Office of the Essential Chemicals & Plastics Sector and establish Planning & Coordination Office, Rabigh Business, a new organization that will take charge of those operations. 

This reorganization will be implemented to redouble our efforts to deal with the Rabigh business, which is one of our priority management issues. The business is centered around Rabigh Refining and Petrochemical Company, an affiliate accounted for using the equity method.

[After reorganization] 

  • Planning &Coordination Office, Essential Chemicals &Plastics Sector
  • Planning & Coordination Office, Rabigh Business
  • Responsible Care Dept., Essential Chemicals &Plastics Sector

[Before reorganization] 

  • Planning &Coordination Office, Essential Chemicals &Plastics Sector
  • Responsible Care Dept., Essential Chemicals &Plastics Sector