Notice Regarding the Recognition of an Extraordinary Loss Following the Suspension of Business Activities at a Consolidated Subsidiary in Hungary
Nippon Paper Chemicals Europe Zrt. (NPCE), a consolidated subsidiary of Nippon Paper Industries
NPCE at Harasztipuszta 17, Vácrátót, Hungary, and the manufacture and sale of CMC for lithium-ion batteries (the Company's product name: SUNROSE MAC®)
The review of environmental regulations by countries in Europe and the United States, adjustments to EV adoption policies, changes to subsidy schemes, slower growth in the EV market in Europe and the United States, and intensifying global competition have made it difficult to secure stable earnings and achieve investment returns commensurate with profitability.
Approximately ¥5.0 billion (including impairment losses on fixed assets, expected to be recognized as extraordinary losses)
Fiscal year ending March 2027
The consolidated earnings forecast for the fiscal year ending March 2027 is currently under review. If any matter requiring additional disclosure arises, it will be disclosed promptly.
Company response
NPCE will discontinue its business activities, including the manufacture and sale of CMC for lithium-ion batteries (SUNROSE MAC®), on 31 December 2026.
The manufacture of CMC will be consolidated at the Gōtsu Mill in Japan to improve production efficiency and strengthen competitiveness. The initiatives set out in the Medium-Term Management Plan 2030 will continue to be pursued.
If any matter requiring additional disclosure arises, it will be disclosed promptly.
| Item | Details |
|---|---|
| Event name | Notice Regarding the Recognition of an Extraordinary Loss Following the Suspension of Business Activities at a Consolidated Subsidiary in Hungary |
| Date of occurrence | 7 September 2026 (the date on which NPCE decided to discontinue its business activities) |
| Subject Entity | Nippon Paper Chemicals Europe Zrt. (NPCE), a consolidated subsidiary of Nippon Paper Industries |
| Target Locations / Products | NPCE at Harasztipuszta 17, Vácrátót, Hungary, and the manufacture and sale of CMC for lithium-ion batteries (the Company's product name: SUNROSE MAC®) |
| Cause | The review of environmental regulations by countries in Europe and the United States, adjustments to EV adoption policies, changes to subsidy schemes, slower growth in the EV market in Europe and the United States, and intensifying global competition have made it difficult to secure stable earnings and achieve investment returns commensurate with profitability. |
| Amount of Impact on Business Performance | Approximately ¥5.0 billion (including impairment losses on fixed assets, expected to be recognized as extraordinary losses) |
| Accounting period in which recognized | Fiscal year ending March 2027 |
| Impact on Earnings Forecast | The consolidated earnings forecast for the fiscal year ending March 2027 is currently under review. If any matter requiring additional disclosure arises, it will be disclosed promptly. |
| Suspended operations | NPCE will discontinue its business activities, including the manufacture and sale of CMC for lithium-ion batteries (SUNROSE MAC®), on 31 December 2026. |
| Outlook | The manufacture of CMC will be consolidated at the Gōtsu Mill in Japan to improve production efficiency and strengthen competitiveness. The initiatives set out in the Medium-Term Management Plan 2030 will continue to be pursued. |
| Planned follow-up disclosure | If any matter requiring additional disclosure arises, it will be disclosed promptly. |
Items this document does not state (14)
These are items the company does not state in this document. We do not leave them blank, nor fill them in from other sources or by inference.
The reasons the company gives
The company's own explanation, not something inferred from the numbers.Due to changes in environmental regulations and EV adoption policies and subsidy schemes in Europe and the United States, slower growth in the EV market, and intensifying global competition, it will be difficult to secure stable earnings for the foreseeable future, and investment returns commensurate with profitability cannot be expected. Preventing further losses and deterioration in cash flow that could result from continuing the business is also cited as a reason.