Advance Create : Summary of Consolidated Financial Results for the Three Months Ended December 31, 2021(Based on Japanese GAAP)

Translation

Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes. In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

Summary of Consolidated Financial Results

for the Three Months Ended December 31, 2021

(Based on Japanese GAAP)

February 10, 2022

Company name: Advance Create Co.,Ltd.

Stock exchange listing: Tokyo

Stock code:	8798 URLhttps://www.advancecreate.co.jp/
Representative:	President Yoshiharu Hamada
Officer, General Manager of Corporate
Inquiries:

Akira Iwai
Planning Division
Scheduled date to file Quarterly Securities Report:	February 10, 2022
Scheduled date to commence dividend payments:	-
Preparation of supplementary material on quarterly financial results:	Yes
Holding of quarterly financial results meeting:	No

TEL [phone]

(Amounts The company conducted a stock split on April 1ts less than one million yen are rounded down)

1. Consolidated financial results for the three months ended December 31, 2021 (from October 1, 2021 to December 31, 2021)

(1) Consolidated operating results (cumulative)

Percentages indicate year-on-year changes

Net sales	Operating profit	Ordinary profit	Profit attributable to owners of parent
Three months ended December 31, 2021 Three months ended December 31, 2020	Millions of yen 2,712 2,573	% 5.4 (2.5)	Millions of yen 340 215	% 58.0 (27.0)	Millions of yen 310 186	% 66.5 (32.9)	Millions of yen 173 92	% 86.6 (47.6)

Earnings per share	Diluted earnings per share
Three months ended December 31, 2021 Three months ended December 31, 2020	Yen 7.89 4.32	Yen - 4.31

(Note) The Company conducted a 2-for-1 stock split of its common shares on April 1, 2021. Earnings per share for the first quarter and diluted earnings per share for the first quarter have been calculated based on the assumption that the stock split was carried out at the beginning of the previous fiscal year.

(2) Consolidated financial position

Total assets	Net assets	Equity ratio
As of December 31, 2021 As of September 30, 2021	Millions of yen 11,187 11,808	Millions of yen 6,339 6,723	% 56.7 56.9

2. Cash dividends

Annual dividends per share
1st quarter-end	2nd quarter-end	3rd quarter-end	Fiscal year-end	Total
Year ended September 30, 2021 Year ending September 30, 2022	Yen - -	Yen 30.00	Yen -	Yen 15.00	Yen -
Year ending September 30, 2022 (Forecast)	15.00	-	15.00	30.00

(Note) Revision of dividend forecast to the latest announcement: No

The Company conducted a 2-for-1 stock split of its common shares on April 1, 2021. The amounts stated for dividends for the first six months of the fiscal year ended September 30, 2021 and for prior periods are stated at the actual amount paid per share based on the number of shares before the stock split. Without factoring in the stock split, the year-end dividend for the fiscal year ended September 30, 2021 would have been ¥30.00 and the annual dividend per share would have been ¥60.00. Furthermore, the total dividend amount for the fiscal year is presented as "-" as simple addition is not appropriate.

3. Forecast of consolidated financial results for the year ending September 30, 2022 (from October 1, 2021 to September 30, 2022)

Percentages indicate year-on-year changes

Net sales	Operating profit	Ordinary profit	Profit attributable to owners of parent	Earnings per share
Full year	Millions of yen 12,500	% 13.4	Millions of yen 2,300	% 12.7	Millions of yen 2,200	% 14.2	Millions of yen 1,450	% 11.9	Yen 66.31

4. Notes

• (1) Changes in significant subsidiaries during the three months ended December 31, 2021

  (changes in specified subsidiaries resulting in the change in scope of consolidation):

• (2) Application of special accounting methods for preparing quarterly consolidated financial statements:

• NoNo

• (3) Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial statements

Changes in accounting policies due to revisions to accounting standards and other regulations:	Yes
Changes in accounting policies due to other reasons:	No
Changes in accounting estimates:	No
Restatement of prior period financial statements:	No
(4) Number of issued shares (common shares)
Total number of issued shares at the end of the period (including treasury shares)
Number of treasury shares at the end of the period
Average number of shares during the period (cumulative from the beginning of the fiscal year)
2

As of December 31, 2021

22,557,200 shares

As of September 30, 2021

22,557,200 shares

As of December 31, 2021

720,478 shares

As of September 30, 2021

556,878 shares

Three months ended December 31, 2021

21,961,824 shares

Three months ended December 31, 2020

21,502,854 shares

Quarterly consolidated financial statements Consolidated balance sheets

(Thousands of yen)
As of September 30, 2021	As of December 31, 2021
Assets Current assets Cash and deposits Notes and accounts receivable - trade Accounts receivable - other Other	3,337,578 1,406,935 2,456,697 767,405	1,857,889 1,301,619 3,050,040 1,023,752
Total current assets	7,968,616	7,233,301
Non-current assets Property, plant and equipment Intangible assets Software Other	581,376 697,685 95,215	694,345 790,078 47,423
Total intangible assets	792,901	837,502
Investments and other assets Investment securities Guarantee deposits Insurance funds Deferred tax assets Other	328,571 614,976 740,584 316,761 446,648	273,197 620,653 740,584 274,161 497,523
Total investments and other assets	2,447,542	2,406,120
Total non-current assets	3,821,820	3,937,968
Deferred assets	17,950	16,266
Total assets	11,808,387	11,187,536
Liabilities Current liabilities Current portion of bonds payable Income taxes payable Accounts payable - other Deposits received Lease obligations Provision for bonuses Asset retirement obligations Other	200,000 531,564 1,144,394 464,141 83,219 180,663 8,099 655,125	200,000 22,578 1,348,120 516,430 88,138 89,555 8,099 524,247
Total current liabilities	3,267,207	2,797,168
Non-current liabilities Long-term borrowings Bonds payable Lease obligations Retirement benefit liability Asset retirement obligations Other	86,020 600,000 375,093 392,700 206,711 157,413	300,000 500,000 430,991 397,316 231,608 191,148
Total non-current liabilities	1,817,940	2,051,064
Total liabilities	5,085,148	4,848,233
(Thousands of yen)
As of September 30, 2021	As of December 31, 2021
Net assets Shareholders' equity Share capital Capital surplus Retained earnings Treasury shares	3,158,703 585,325 3,272,846 (404,293)	3,158,703 585,325 3,107,830 (584,021)
Total shareholders' equity	6,612,582	6,267,838
Accumulated other comprehensive income Valuation difference on available-for-sale securities	110,656	71,464
Total accumulated other comprehensive income	110,656	71,464
Total net assets	6,723,239	6,339,303
Total liabilities and net assets	11,808,387	11,187,536

Consolidated statements of income (cumulative) and consolidated statements of comprehensive income (cumulative)

Consolidated statements of income (cumulative)

(Thousands of yen)
Three months ended December 31, 2020	Three months ended December 31, 2021
Net sales Cost of sales	2,573,540 736,908	2,712,414 609,096
Gross profit	1,836,632	2,103,318
Selling, general and administrative expenses	1,621,218	1,762,998
Operating profit	215,413	340,320
Non-operating income Interest and dividend income Gain on forfeiture of unclaimed dividends Guarantee commission received Foreign exchange gains Other	778 414 2,045 - 402	87 446 2,230 3,077 1,551
Total non-operating income	3,641	7,393
Non-operating expenses Interest expenses Guarantee commission Commission expenses Other	2,189 375 27,952 1,844	2,109 296 32,635 1,750
Total non-operating expenses	32,362	36,792
Ordinary profit	186,692	310,921
Extraordinary losses Loss on retirement of non-current assets Loss on store closings Loss on termination of ESOP trust	3,224 19,459 -	1,202 - 10,925
Total extraordinary losses	22,684	12,127
Profit before income taxes	164,008	298,794
Income taxes - current Income taxes - deferred	34,345 36,780	64,624 60,865
Total income taxes	71,126	125,489
Profit	92,881	173,304
Profit attributable to owners of parent	92,881	173,304