KANEKA CORPORATION

Business Details

Comprised of three Solutions Vehicles: Vinyls and Chlor-Alkali, Performance Polymers (MOD) (modifiers and biodegradable biopolymers), and Performance Polymers (MS) (modified silicone polymers). The segment provides materials that support the lightweighting and fuel efficiency of social infrastructure and mobility, as well as advanced materials such as Green Planet® that biodegrade in soil and seawater, on a global basis. It pursues a global strategy integrated with Kaneka Belgium N.V., Kaneka North America LLC, and others, contributing to environmental protection and comfortable living.

Recent Overview

Continued sluggish Asian market conditions and weak demand in the U.S. and Europe led to lower sales and profit; an impairment loss was recognized in the U.S.

In FY2026 (ending March 2026), net sales were ¥327,235 million (down 4.6% year on year) and operating income was ¥24,928 million (down 19.5% year on year), representing the largest profit decline among all segments. Vinyls and Chlor-Alkali was affected by sluggish demand in Asia and domestically, while MOD and MS saw delayed demand recovery in the U.S. and European markets. An impairment loss of ¥2,169 million was recognized on PVC-based specialty resin manufacturing equipment in Texas, U.S.A. On the other hand, overseas demand began to recover in the fourth quarter, and there were signs of structural improvement, such as expanded sales of high-value-added MOD products and progress in the social implementation of Green Planet®. The outlook for the next fiscal year (FY2027, ending March 2027) remains challenging, with projected net sales of ¥326,000 million (down 0.4% year on year) and projected operating income of ¥24,200 million (down 2.9% year on year).

Key Products

Growth Drivers

• Improvement in the profit structure of Performance Polymers (MOD) through expanded sales of competitive, high-value-added grades such as MX for non-PVC applications
• Improved global local-production-for-local-consumption supply capability and capture of European demand through the operation of the capacity expansion facility for modified silicone polymers (MS) in Belgium
• Expanded adoption of the biodegradable biopolymer Green Planet® across diverse applications domestically and overseas, and progress in social implementation through large-scale projects
• Resilient business operations through a local-production-for-local-consumption global business structure, and the ability to respond to risks from Middle East conditions and tariffs

Risks

• Pressure on Vinyls and Chlor-Alkali profitability due to prolonged sluggish PVC market conditions in Asia
• Impact on the MOD and MS businesses from delayed demand recovery in the U.S. and European housing and construction markets
• Surging and volatile crude oil and naphtha prices and supply uncertainty against the backdrop of Middle East conditions
• Global economic disruption and demand uncertainty due to U.S. tariff policy and intensifying U.S.-China friction (volatile fluctuations in demand, prices, and costs are expected to continue next fiscal year)
• Risk of delayed customer evaluation and adoption decisions for large-scale Green Planet® projects
• Risk of continued sluggish demand for PVC-based specialty resins at the U.S. subsidiary (Kaneka North America LLC)