Hokko Chemical Industry expects the benzene-containing wastewater leak at its Okayama plant to cost about ¥300mn in the current fiscal year, booked as an extraordinary loss. It is not changing its full-year forecast. A separate drainage rebuild of about ¥500mn is planned over roughly two years and is not part of that loss.
The ¥300mn loss
The company's notice puts the figure at "about ¥300mn, including a countermeasure provision". It covers repairs to drainage facilities, soil and water-quality surveys and analysis, and measures to stop groundwater contamination from spreading. Hokko Chemical plans to book it as a special loss in the consolidated results for the fiscal year ending November 2026. The estimate rests on information the company holds now and assumptions it calls reasonable.
| Item | Amount | Accounting treatment |
|---|---|---|
| Response costs (repairs, surveys, groundwater spread prevention) | About ¥300mn | Special loss in the year ending November 2026, including a countermeasure provision |
| Drainage structure improvement and relocation | About ¥500mn | Fixed assets from next fiscal year; over about two years; excluded from the loss |
Why guidance holds
The forecast stays put because of a gain already booked. In the first nine months of the year Hokko Chemical recorded a ¥237mn extraordinary gain on sales of investment securities. The company cites that gain, among other factors, in saying the loss does not require a revision. The existing forecast, published on 13 January 2026, is ¥52bn in sales, ¥5.2bn in operating profit, ¥6.1bn in ordinary profit and ¥4.46bn in net profit attributable to owners of the parent, or ¥173.00 per share. The company says it will announce any needed revision promptly.
The ¥500mn rebuild
To prevent a recurrence, Hokko Chemical plans to improve and relocate the drainage structure inside the Okayama plant over about two years. It puts that capital spending at about ¥500mn and says it will be booked as fixed assets from next fiscal year onward. The company says this sum is excluded from the ¥300mn loss. The two figures cover different work and fall in different periods, so they should not be added together as one current-year cost.
What remains open
The notice is a cost estimate, not a closing statement. Hokko Chemical apologises to residents, fishing interests and authorities and points to its third report of 23 October for an overview of the incident. The notice does not give a final contamination scope, any health findings or any regulatory penalty. Earlier Tokyo Brief coverage