[Company analysis] Mitsubishi Chemical Holdings Corporation (三菱ケミカルホールディングス)

「Mitsubishi Chemical Holdings Corporation (三菱ケミカルホールディングス)」is a affiliated chemical company of the "Mitsubishi Group" and the largest general chemical company in Japan. Even compare with other affiliated chemical companies such as「Sumitomo Chemical(住友化学)」 and 「Mitsui Chemicals(三井化学)」, this company is overhelming. Based on 2019, 「Mitsubishi Chemical」ranks 11th in the world as a chemical company. The number of consolidated employees is about 72,020.

 

1. Company Profile

2. Summary and Features

3. Major Business

4. Financial Information

 

 

 

1. Company Profile

 

※Unit is JPY million, as of 2019

Company name	Mitsubishi Chemical Holdings Corporation
Company name (Japanese)	三菱ケミカルホールディングス
Date of establishment	Monday, October 3, 2005
Headquarters location	〒100-8251 東京都千代田区丸の内1-1-1
Capital	50,000
Consolidated sales	3,923,444
Consolidated operating profit	297,950
Consolidated total assets	5,572,508
Consolidated capital	2,025,854
Capital adequacy ratio	36.4%
Consolidated number of employees	72,020

 

 

 

2. Summary and Features

 
「Mitsubishi Chemical」is in charge of the chemical division of the Mitsubishi Group and they have numerous chemical product manufacturing subsidiaries and pharmaceutical manufacturing companies. Basically, they focus on the development of technologies related to semiconductors, electronic devices, and polymer compounds, but the fields of application are extremely wide. However, the current「Mitsubishi Chemical Holdings Corporation」was born in 2005, and at this time,「Mitsubishi Chemical」was also born after the merger and reorganization of the Mitsubishi Group's chemical affiliates.

Behind the integration, there was a sense of crisis. In recent years, international competition in the chemical field has become extremely intense, and many Japanese general chemical companies have stepped down from the "upstream process" that handles traditional general-purpose chemical products. Instead, they made reorganization their business structure into a “middle-class process” that handles high-performance materials. But the Mitsubishi Group did not dare to choose that path.

In fact, general petrochemical products have low barriers to technology entry and little room for product differentiation. So the competitions in this sector is expected to become more and more intensive and its profitability shall be worsened. That is why many chemical companies decided to focus on high value-added specific products. However, 「Mitsubishi Chemical」has decided to maintain a lineup including general petrochemical products.

The Mitsubishi Group's chemical-related companies had a long history and were evaluated as having extremely high technical standards in their respective fields. However, the corporate culture was conservative and the attitudeamong employees was different, so the Internal communication between group companies was not very good.

 

Accordingly, they decided to conduct integration and「Mitsubishi Chemical」were abled to bind all Mitsubishi's chemical related comapnies into one banner. And this strategy did work. In 2005, sales were only 2.4 trillion yen immediately after the merger, but in 2015 they increased significantly to 3.7 trillion yen, even though the margins are not high enough. The average operating margin between 2005 and 2014 was only 4.4%. 

 

 

 

3. Major Business

 

■ High-performance polymer
Functional resins, sustainable resources, and others

■ Advanced Chemistry
Functional materials, functional food materials, etc.

■ Information and display
Optical films, information electronic materials, etc.

■ High-performance film
Food packaging, industrial, medical / hygiene, etc.

■ Environmental and Living Solutions
Aqua Solutions, Agribusiness, Others

■ High-performance molding materials
Carbon fiber, alumina fiber, etc.

■ New energy
Lithium battery materials, etc.

■ Petrification
Polyolefins, basic chemicals, etc.

■ Carbon
Coke, carbon black, other

■ MMA
Methyl methacrylate, acrylonitrile, and others

 

 

 

4. Financial information

 

※Unit is JPY million

		2016	2017	2018
Consolidated sales		3,376,057	3,724,406	3,923,444
Consolidated operating profit		268,621	355,711	297,950
Consolidated total assets		4,463,547	4,700,592	5,572,508
Consolidated net assets		1,698,197	1,919,490	2,025,854
Breakdown of sales	Functional Chemicals Business	1,072,640	1,145,932	1,170,119
	Chemicals business	983,957	1,177,352	1,270,750
	Industrial gas business	574,664	638,675	732,837
	Healthcare business	547,032	556,568	545,666
	Others	197,764	205,879	204,072