1

Financial Results for 1st Half of FY2011

The Nippon Synthetic Chemical Industry Co., Ltd.

New Mid-Term Management Plan,“Ｄｏｕｂｌｅ１５” , is underway

November 17, 2011

2

Results of 1st Half andForecast of FY2011

3

05

1015202530

Q1/10 Q2 Q3 Q4 Q1/11 Q20

1

2

3(¥:Billion) Sales Operating income

Business Results of 1st Half FY201１

2.8 2.8 2.12.2

◆ Q1 steady, Q2 slowing down“OPL Film” declined due to customers destocking.“Soarnol” did well in the European and North American markets,and is increasing in the Asian market.

◆ Profit down due to very strong yen; sale price spread worsening

3

(¥:Billion)

2.21.7

4

0102030405060

1st Half '09 2nd Half 1st Half '10 2nd Half 1st Half '11 2nd Half

0123456Sales Operating income

Business Forecast of 2nd Half FY2011

5.15.5 5.6 3.94.3

(¥:Billion) (¥:Billion)

4

4.0(forecast)

◆ Uncertainty continues for LCD materials and others.“OPL Film” should recover from destocking, and larger volume isforeseen for the 2nd half.“Soarnol” will continue strong in the European and North Americanmarkets, and also continue to grow in the Asian market.

◆ Strong yen will continue.

5

020406080

100120

FY07 FY08 FY09 FY10 FY11

024681012Sales Operating income

Annual Cash Dividends (JPY) 7 7 10 12 12

Interim Cash Dividends (JPY) － － 4 5 6

4.3

7.7

10.7

8.010.0

Business Forecast of FY2011

(¥:Billion) (¥:Billion)

5

（forecast）

１．”OPL Film”１．”OPL Film”

Efforts to Achieve “Double 15”（1）

◆ 5th new line (15 million ㎡／year）Scheduled for completion January-March 2012;our first facility to handle ultra-wide film

◆ Future constructionImmediate demand is stagnant.Positioning as growth area in the medium to long term,with expansion plans on the horizon

◆ Pressure-sensitive Adhesive resinsExpanding “Coponyl” and “Shikoh” overseas (including M&A)Planning local production and sales of emulsionwith Chinese Manufacturer

◆ Nichigo G-PolymerFocus on targets and search for volume zones

6

２．Building Third Pillar２．Building Third Pillar

３．Business focus and selection３．Business focus and selection

7

◆ Restructure Fine Chemicals businessWithdraw unprofitable products (Ketene derivatives, etc.)

◆ Launch new products“ORGA” (glass replacement optical sheet)

◆ Strengthen and increase competitiveness of existing PVOH films“Hi-Selon” Expand overseas“Bovlon” Agricultural film, etc.

Efforts to Achieve “Double 15”（2）

8

Business Results of1st Half FY2011

9

Consolidated Results

1st Half FY10

1st Half FY11 Diff.

Sales 46.4 44.5 ▲1.8 （▲ 4.1%）

Operating income 5.6 3.9 ▲1.7 （▲30.3%）

Operating income ratio 12.2% 8.9% ▲ 3.3%Ordinary income 5.1 3.4 ▲1.6 （▲32.8%）

Net profit 2.9 1.8 ▲1.1 （▲38.0%）

<Topics>Non-operating profit and loss

Exchange-rate losses 0.43 0.51 ▲0.08Extraordinary loss

Loss from securities revaluation 0.55 0.60 ▲0.05

(¥:Billion)

10

Sales Operating income1st Half

FY101st Half

FY11 Diff. 1st Half FY10

1st Half FY11 Diff.

①Synthetic Resin 33.2 31.5 ▲1.6 5.6 3.9 ▲1.6②Acetyl & Fine

Chemicals 11.5 11.1 ▲0.4 0.0 0.0 ＋0.0③Chemical

Products 44.8 42.7 ▲2.0 5.7 4.0 ▲1.6

④Others 1.6 1.8 ＋0.1 0.1 0.１ ＋0.0

⑤Common Cost - - - ▲0.1 ▲0.2 ▲0.1

Total ③～⑤ 46.4 44.5 ▲1.8 5.6 3.9 ▲1.7

Business Summary by Segment (1)

(¥:Billion)

Synthetic ResinSynthetic Resin

Acetyl and Fine ChemicalsAcetyl and Fine Chemicals

Business Summary by Segment (2)

◆ “OPL Film”Affected by destocking from July, down from last year

◆ “Soarnol”Continued good results in European and North Americanmarkets, increased volume in Asian market

◆ Pressure-sensitive adhesive, functional coatingsLower sales than last year in information and communicationtechnology and electronic materials

◆ Sales have fallen for Fine Chemical products.

11

12

0

1

2

3

4

5

6

7

8

9

▲0.6＋5.6

1st HalfFY11

Operating income

VolumeFixed costs

Raw materials

price

Includingexchange

effects

1st HalfFY10

Operating income

Analysis of Operating Income

Sales price

▲2.0

＋3.9(▲0.3)

▲0.9

(¥:Billion)

＋0.6

＋1.2

Movingaverage,

etc

13

1st HalfFY10

1st HalfFY11 Diff.

CAPEX 2.0 3.8 ＋1.8Depreciation 3.2 3.2 ＋0.0R&D Expenses 1.3 1.5 ＋0.2JPY/US$ 89 80 ▲9JPY/EURO 114 114 ±0※ Average rate

Naphtha price (JPY/KL) 46,200 57,000 ＋10,800※ Average price

CAPEX, Depreciation, Exchange rate, and Naphtha price

(¥:Billion)

Liabilities

Net assets

Retained earnings＋1.1、Currency Exchange adjustments＋1.0

Current assets

Fixed assets

Balance Sheet

Assets Liabilities andshareholder’s equity

Equity 54.9 57.0 ＋2.1Equity Ratio 56.2% 57.3% ＋1.1%Debt 13.5 11.8 ▲1.7D/E Ratio 0.24 0.21 ▲0.03

Period end exchange rate for Overseas subsidiaries（yen）

End of Dec. 2010 End of Jun. 2011

US$ 81 81€ 108 117

＊Exchange rate effect is ¥1.3 billion of total asset increase.14

97.8 99.5 ＋1.7 97.8 99.5 ＋1.7

48.6 49.5 ＋0.9 42.9 42.5 ▲0.4

49.1 50.0 ＋0.9 54.9 57.0 ＋2.1

End ofFY10

End of1st Half FY11

Diff.

End ofFY10

End of1st Half FY11

Diff.

(¥:Billion)

1st Half FY10

1nd Half FY11

Cash Flow fromoperating activities 7.0 4.0

Pretax profit variance▲1.8Operating Capital increase▲1.2

Cash Flow frominvesting activities ▲2.2 ▲3.1

Fixed asset acquisition▲1.0

Cash Flow fromfinancial activities ▲6.9 ▲2.6

Debt repayment decrease＋4.3

Cash and cash equivalentsat beginning of period ▲2.3 ▲1.7Cash and cash equivalentsat end of period 9.4 6.2

Cash Flow

(¥:Billion)

15

16

Business Forecast ofFY2011

17

1st Half Ave. 2nd Half Diff.JPY/ＵＳ＄ 80 77 ▲3JPY/EURO 114 105 ▲9

１．Exchange rate１．Exchange rate

Assumptions of 2nd Half FY2011

1st Half Ave. 2nd Half Diff.Naphtha 57,000 54,000 ▲3,000

２．Naphtha price （JPY／KL）２．Naphtha price （JPY／KL）

18

1stHalfFY11

2ndHalfFY11

FY11 FY10 FY09

Sales 44.5 44.4 89.0 91.2 90.0Operatingincome 3.9 4.0 8.0 10.0 10.7Operating income ratio 8.9% 9.1% 9.0% 11.1% 12.0%Ordinary income 3.4 3.9 7.4 9.4 10.0Net Profit 1.8 2.1 3.9 6.1 5.7Net Profitper share (yen) 18.59 21.45 40.04 62.94 59.06Cash dividendsper share (yen) 6 6 12 12 10

Consolidated Earnings forecast of FY2011

(¥:Billion)

19

Sales Operating income

FY10results

FY11forecast Diff. FY10

resultsFY11

forecast Diff.

①Synthetic Resin 64.9 63.8 ▲1.1 10.2 8.1 ▲2.1②Acetyl & Fine

Chemicals 22.9 21.6 ▲1.3 ▲0.1 0.1 ＋0.2③Chemical

Products 87.8 85.4 ▲2.4 10.1 8.2 ▲1.9

④Others 3.3 3.6 ＋0.2 0.2 0.2 ＋0.0

⑤Common Cost - - - ▲0.2 ▲0.4 ▲0.1

Total ③～⑤ 91.2 89.0 ▲2.2 10.0 8.0 ▲2.0

Consolidated Earnings forecast of FY2011by segment

(¥:Billion)

20

0

2

4

6

8

10

12

14

▲3.7

＋10.0

FY11Operating

income

Volume

Movingaverage,

etc.

Rawmaterials

priceFY10

Operatingincome

Analysis of Operating Income

Salesprice

+0.5

＋8.0

＋1.6

＋1.2▲1.6

(¥:Billion)

Fixed costsincluding

exchangeeffects

(▲0.5)

FY10 FY11 Diff.CAPEX 6.7 6.7 －

Depreciation 6.5 7.0 ＋0.4

R&D Expenses 2.8 3.4 ＋0.6

CAPEX, Depreciation, and R&D Expenses

(¥:Billion)

21

22

Glass replacement Optical Sheet

“ORGATM”

23

ORGATM (Glass replacement optical sheet)

＜New Transparent Polymer Optical Sheet！＞Light, tough, good workabilityHeat resistant to more than 200℃, pencil hardness >3H （max. 7H）

Scratch-resistant, chemical-resistantBest characteristic: as transparent as glass, and zero optical strain

Low profile film type 0.2 ｍｍＴ Thick sheet type 1.0 ｍｍＴ

Single sheet plastic with this kind of performance did not exist before.

24

ORGATM Application

Scratch-resistance・・・Cover sheet (Cover)Toughness ・・・・・・・・・WindowHigh heat resistance and transparency

・・・Touch panel （Substrate with ITO）

Examples of applications that make the most of performance＜smartphone＞

25

ORGATM The glass Replacement: Performance①

Two main types: rigid and flexible, and both requireopposing performanceRigid “ORGATM” targets high definition devices using glass.

Heat resistance（℃）

Surfacehardness

0 100 200 300 400 500

7H

6H

5H

4H

3H

2H

H

HB

B

Glass

ORGA

PMMA

PC

PI

DAP

Flexible area

Rigid area

PET

Cover sheet（Cover） Window Touch panel

＊Without sufficient heat resistanceand surface hardness, printingand electrode processing aredifficult

26

Reinforcedglass ORGA Polycarbonate ＰＭＭＡ

Transparency ○ ○ × △

Surfacehardness

○ △ × ×

Heatresistance

○ ○ × ×

Solventresistance

○ ○ × ×

Workability × ○ ○ ○

Safety × ○ ○ ○

We are focusing on developing more of the capabilities required to grow with the market.

ORGATM The glass Replacement: Performance②

ORGATM Workability

Printing and transparent electrode deposition can be done directlyon the sheet.

＊Ordinary plastic needs an under layer and pre-treatment.After printing, the sheet can be cut into the final shape.

＊Reinforced glass has to be cut one sheet at a time, then printed or processed.

Laser cutting27

Print ＆ deposition

28

ORGATM Sales Development

Adoption for smartphone cover sheets (covers)Good evaluation results for window and touch panel applicationsCurrent supply capacity translates into about 2 million smart phones / year.We plan to maintain supply capacity by expanding facilitiessequentially in line with sales

Our aim is to target the market for reinforced glass replacement using applications that make the most of “ORGA”’s unique performance.

Solution by Chemistry The amounts in this report are rounded down when less than a

unit; percentages, etc. are round off.

Further, the cumulative six months of the first and second quarters are the first half, and the cumulative six months of the third and fourth quarters are the second half.

The business forecast and predictions in this report are calculated based on the information available at the time of writing. It is possible that the actual results may differ due to a variety of factors.

29

Appendix

30

Products List

31

32

Outlines of Segments

Chemicals

Others

SyntheticResins

Acetyl & FineChemicals

PVOH Resins, Films

Acetyl Chemicals

EVOH Resins

Adhesive Resins

Fine Chemicals

Feature・Water solubility・adherence・Film forming properties, etc.

◆What is “Gohsenol TM”?

The Mizushima Plant 40,000 tonnes / yThe Kumamoto Plant 30,000 tonnes / yTotal 70,000 tonnes / y

Used as raw material for PVOH films・optical polarized PVOH

film, etc.

Glass

Glass

PVOH(a materials of PVB films)

PVOH (Polyvinyl Alcohol : Gohsenol TM)

◆”Gohsenol TM” Production capacities

◆Main Application

Used as raw material for the bonding middle layer in safety glass for windshields

Used as a surface coating agent for information industrial paper・heat sensitive paper・ink jet recording paper,

etc.

33

2003 12 million sq. meters / y The Ogaki Plant2005 13 million sq. meters / y The Ogaki Plant2008 15 million sq. meters / y The Kumamoto Plant 2009 15 million sq. meters / y The Kumamoto Planttotal 55 million sq. meters / y *2012 15 million sq. meters / y (plan) The Kumamoto Plant

◆OPL Film TM Production capacities

To make polarizing film, OPL Film TM for polarizer is inserted between two layers of protective film called TAC film, and adherently processed to affix to LCD panel.

Optical Polarized PVOH Film : OPL Film TM

◆What is OPL Film TM ?

34

Feature・High gas barrier・Fragrance preservation・Transparency, etc.

The Mizushima Plant 10,000 tonnes / yNOLTEX (U.S.A.) 20,000 tonnes / yNIPPON GOHSEI UK 15,000 tonnes / yTotal 45,000 tonnes / y

Soarnol TM is a package for preserving flavor and freshness.

Polyethylen ＥＶＯＨ

ＥＶＯＨ

Polyolefin

Polyolefin

Adhesive resin

Adhesive resinＥＶＯＨ

Nylon

Nylon

EVOH : Soarnol TM

◆What is EVOH ?

◆Soarnol TM Production capacities

◆Main application

35

・Adhesive resin for polarizing film for LCD・Masking tape for surface protection

Glossy retension and surface protection for CDs, DVDs, mobile phones and ATM touch-sensitive panels

・Temporarily immovable tape・Masking tape for surface protection

Cable coating and adhesion for copying machine and facimile machine

Pressure Sensitive Adhesives and Functional Coatings◆Main application for LCD

TAC film

PVOH film

Adhesive

Protective tape

TAC film

Release film

◆Main application for Semiconductor

◆Main application for Hard Coating ◆Main application for recording media

Silicon crystal

Back grind tape

Back grind process sheet

Dicing process

UV irradiate

36

37

Soarus

NOLTEX

NIPPON GOHSEI Europe（Sales, Technical service）

NIPPON GOHSEI UK

（Production of Soarnol）

NIPPON GOHSEI

NIPPON GOHSEI THAILAND

NICHIGO SHANGHAI

Overseas Bases

（Sales, Technical service）

（Sales, Technical service）

（Production of Soarnol）

（Sales, Technical service）

38

¥:Billion FY06 FY07 FY08 FY09 FY10

Sales 95.8 109.6 100.9 90.0 91.2

(Synthetic resins) 58.6 68.7 64.5 65.0 64.9

(Acetyl and Fine chemicals) 33.3 36.6 32.6 22.7 22.9

(Others) 3.8 4.1 3.7 2.2 3.3

Operating income 5.7 7.7 4.3 10.7 10.0

(Synthetic resins) 5.3 7.5 4.2 10.7 10.2

(Acetyl and Fine chemicals) 0.3 0.1 0.2 0.2 △0.1

(Others) 0.1 0.1 0.0 0.0 0.2

(Common costs) △0.1 △0.2 △0.2 △0.2 △0.2

Net profits 2.2 5.5 0.9 5.7 6.1

Total Assets 121.1 122.4 106.8 106.6 97.8

Debt 40.9 37.0 32.2 22.7 13.5

Net Assets 47.7 52.6 48.6 53.9 54.9

CAPEX 2.2 6.6 6.0 5.1 6.7

Depreciation 5.3 5.9 6.8 6.7 6.5

¥:Billion FY06 FY07 FY08 FY09 FY10

Japan 6.1 5.7 2.6 8.1 6.3

America 0.9 1.2 0.9 1.5 1.8

Europe △0.4 0.9 0.6 1.0 1.9

Asia △0.7 △0.3 ― － －

Total 5.7 7.7 4.3 10.7 10.0

Review of Operation（1）

Operating income by AreaFinancial Highlights

Exchange rate, Naphtha price¥ FY06 FY07 FY08 FY09 FY10

1$ 117.0 114.3 100.5 92.9 85.7

1€ 150.1 161.5 143.5 131.2 113.1

Naphtha Average 49,950 61,450 58,925 41,175 47,450

Net income profit per Share ¥ 23.58 56.57 9.48 59.06 62.94

Net Assets per Share ¥ 471.16 522.56 483.90 538.54 564.07

Cash dividends per Share ¥ 6.0 7.0 7.0 10.0 12.0

Stock price per Share ¥(March 31) 542 731 278 643 513

39

Net Sales and Operating Income by SegmentFY2009 FY2010¥:Billion

Ｑ1 Ｑ2 1st

Half Ｑ3 Ｑ4 2nd

Half Total Ｑ1 Ｑ2 1st

Half Ｑ3 Ｑ4 2nd

Half Total

Sales 21.6 23.2 44.9 23.6 21.5 45.1 90.0 21.6 23.2 46.4 22.7 22.0 44.7 91.2

(Synthetic resins) 15.3 16.4 31.7 16.5 16.7 33.3 65.0 17.0 16.1 33.2 16.1 15.6 31.7 64.9

(Acetyl and Fine chemicals) 5.5 6.2 11.8 6.1 4.7 10.9 22.7 5.8 5.7 11.5 5.8 5.4 11.3 22.9

(Others) 0.7 0.5 1.3 0.9 － 0.9 2.2 0.9 0.7 1.6 0.7 0.9 1.7 3.3

Operating income 2.6 2.9 5.5 2.4 2.7 5.1 10.7 2.6 2.9 5.6 2.2 2.1 4.3 10.0

(Synthetic resins) 2.6 2.7 5.4 2.4 2.8 5.3 10.7 2.8 2.8 5.6 2.3 2.1 4.5 10.2

(Acetyl and Fine chemicals) 0.1 0.1 0.2 0.0 △0.0 △0.0 0.2 0.0 0.0 0.0 △0.0 △0.1 △0.1 △0.1

(Others) △0.0 0.0 △0.0 0.0 0.0 0.0 0.0 △0.0 0.0 0.1 0.0 0.0 0.1 0.2

(Common costs) △0.0 △0.0 △0.1 △0.0 △0.2 △0.2 △0.2 △0.0 △0.0 △0.1 △0.0 △0.1 △0.2 △0.2

Net profit 1.5 1.4 2.9 1.6 1.1 2.8 5.7 1.5 1.4 2.9 1.6 1.5 3.2 61

Review of Operation（２）

40

48,800

57,80059,70061,60066,700

70,900

52,000

26,600

41,200

49,700

42,70045,100

52,400

59,00054,900

85,800

42,500

47,700

33,300

20,00025,00030,00035,00040,00045,00050,00055,00060,00065,00070,00075,00080,00085,00090,000

1Q/07 2Q 3Q 4Q1Q/08 2Q 3Q 4Q1Q/09 2Q 3Q 4Q1Q/10 2Q 3Q 4Q1Q/11 2Q 3Q

JPY

／Ｋ

ＬNaphtha Price (Q1/2007～Q1/2011）

41

120121118113

10510596 94 94 92

86 83 82 8278

122126

117110108

9091

97

117113112111

133134133127

162163

158

164162

163

156

70

80

90

100

110

120

130

140

150

160

170

1Q/07 2Q 3Q 4Q1Q/08 2Q 3Q 4Q1Q/09 2Q 3Q 4Q1Q/10 2Q 3Q 4Q1Q/11 2Q 3Q

JP

Y

Exchange rate（＄、€）(1Q/2007～3Q/2011）

42

Composition of Shareholders

•Authorized Shares 154,944,000•Outstanding Shares 97,411,269

(except 957,917 Shares held by NIPPON GOHSEI)•Number of Shareholders 5,689

Lank Shareholder’s Name Rate

１． Mitsubishi Chemical Corporation 42.7%２． Japan Trustee Services Bank, LTD. （Trust Account） 8.6%

３． The Master Trust Bank of Japan, LTD. （Trust Account） 3.5%４． Japan Trustee Services Bank, LTD. （Trust Account 9） 2.4%

５． Mitsubishi Corporation 2.1%

６． Mizuho Corporate Bank, LTD. 1.2%

７． State Street Bank and Trust Company 1.2%

８． Marubeni Corporation 1.0%

９． Mizuho Securities Co., Ltd. 1.0%

１０． Resona Bank, LTD. 0.9%

Stock information (as of September 30, 2011）

(except 957,917 Shares held by NIPPON GOHSEI)