Brother Industries : Consolidated Results for the 1st Quarter of Fiscal Year ending March 31, 2023

This document is a summary translation of the Japanese language original version. In the event of any discrepancy, errors and/or omissions, the Japanese language version shall prevail.

August 5, 2022

Highlights of Consolidated Results for the Three Months and the First Quarter of Fiscal Year ending March 31, 2023

			Millions of yen (except for per share amounts)
		Three months ended Jun. 30, 2021	Three months ended Jun. 30, 2022	Change
Revenue		Y	174,013	Y	199,734		14.8	%
Business segment profit			26,168		24,788		-5.3	%
Operating profit			26,461		25,018		-5.5	%
Profit before income taxes			26,734		25,297		-5.4	%
Profit for the period			18,771		17,393		-7.3	%
Profit for the period attributable to owners of the parent company			18,618		17,389		-6.6	%
Comprehensive income for the period			21,106		48,555		130.1	%
Basic earnings per share for the period (yen)			71.62		67.60
Diluted earnings per share for the period (yen)			71.42		67.40

(Note) Business segment profit is calculated by subtracting cost of sales and selling, general and administrative expenses from revenue.

			As of Mar. 31, 2022			As of Jun. 30, 2022
Total assets		Y	811,149		Y	851,614
Total equity			561,211			595,546
Equity attributable to owners of the parent company			561,146			595,476
Equity attributable to owners of the parent company ratio			69.2	%		69.9	%
Equity attributable to owners of the parent company per share (yen)			2,170.46			2,324.50

Highlights of Consolidated Forecast for Fiscal Year ending March 31, 2023

			Millions of yen (except for per share amounts)
						[Forecast]	Change
		Year ended Mar. 31, 2022			Year ended Mar. 31, 2023
Revenue		Y	710,938		Y	775,000		9.0	%
Business segment profit			84,552			73,000		-13.7 %
Operating profit			85,501			73,000		-14.6	%
Profit before income taxes			86,429			73,000		-15.5	%
Profit for the period			61,515			51,000		-17.1	%
Profit for the period attributable to owners of the parent company			61,030			51,000		-16.4 %
Basic earnings per share for the period (yen)			234.89			199.57
Dividends per common share (yen)			64.00			68.00

(Note) Business segment profit is calculated by subtracting cost of sales and selling, general and administrative expenses from revenue.

Notes:

1. The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS).
2. Amounts less than 1 million yen have been rounded down.
3. Operating results for the three months ended Jun. 30, 2022 are based on the following currency exchange rates: Actual average rates for the three months ended Jun. 30, 2022: US$=129.04 yen, EURO=138.24 yen Forecasts for the year ending Mar. 31, 2023 are based on the following currency exchange rates:
   Assumed average rates for the year ending Mar. 31, 2023: US$=122.00 yen, EURO=133.00 yen
4. Number of shares outstanding (including treasury stock): 262,220 thousands as of Mar. 31, 2022, 262,220 thousands as of Jun. 30, 2022
   Number of treasury stock outstanding: 3,683 thousands as of Mar. 31, 2022, 6,046 thousands as of June. 30, 2022 Number of weighted average shares:
   259,951 thousands during the three months ended June 30, 2021, 257,235 thousands during the three months ended June 30, 2022
5. Impact ofCOVID-19
   Regarding the impact of COVID-19, it is difficult to predict when it will end and how it will affect future cash-flow, but economic activity is on a recovery trend due to measures such as vaccination. On the other hand, we do not know when the global semiconductor shortage will be resolved and the supply shortage is likely to continue. And also, there is a high possibility that sea freight will continue to rise due to port congestion and imbalance between supply and demand. Due to these reasons, the uncertainty over the Group's future business activities continues.
   The Group has made estimates and judgements involving estimations that the current situation will affect its consolidated financial performance for the year ending Mar. 31, 2023. The Group's consolidated financial statements for the year ending Mar. 31, 2023 and onwards may be significantly affected depending on the actual outcome.

1

Consolidated Statement of Financial Position

				Millions of yen
				As of			As of
				Mar. 31,			Jun. 30,
				2022			2022
Assets
Current assets				Y	146,382
Cash and cash equivalents	Y	167,915
Trade and other receivables		102,685			117,905
Other financial assets		11,419			13,843
Inventories		169,583			199,710
Other current assets		24,843			25,656
Subtotal		476,447			503,498
Non-current assets classified as held for sale		297			-
Total current assets		476,745			503,498
Non-current assets					121,939
Property, plant and equipment		117,127
Right-of-use assets		21,136			22,003
Investment property		7,858			7,457
Goodwill and intangible assets		121,689			124,900
Investments accounted for using		1,862			1,839
the equity method
				33,793
Other financial assets		33,389
Deferred tax assets		21,261			25,424
Other non-current assets		10,078			10,755
Total non-current assets		334,404			348,115
Total assets	Y	811,149		Y	851,614
Equity and liabilities
Liabilities
Current liabilities				Y	78,698
Trade and other payables	Y	71,247
Bonds and borrowings		20,121			22,872
Other financial liabilities		9,517			10,293
Income taxes payable		14,084			7,118
Provisions		3,211			3,791
Contract liabilities		7,807			7,391
Other current liabilities		53,516			52,241
Total current liabilities		179,506			182,407
Non-current liabilities					22,186
Bonds and borrowings		20,705
Other financial liabilities		20,379			20,924
Retirement benefits liabilities		16,366			17,091
Provisions		2,972			3,139
Deferred tax liabilities		7,207			7,281
Contract liabilities		1,600			1,836
Other non-current liabilities		1,197			1,199
Total non-current liabilities		70,431			73,660
Total liabilities		249,937			256,068
Equity					19,209
Capital stock		19,209
Capital surplus		17,866			17,849
Retained earnings		554,910			562,953
Treasury stock		(5,428)			(10,830)
Other components of equity		(25,411)			6,295
Equity attributable to owners of the		561,146			595,476
parent company
				69
Non-controlling interests		65
Total equity		561,211			595,546
Total equity and liabilities	Y	811,149		Y	851,614

2

Consolidated Statement of Income

Millions of yen

		Three months ended		Three months ended
			Jun. 30,			Jun. 30,
			2021			2022
Revenue		Y	174,013		Y	199,734
Cost of sales			(96,256)			(115,626)
Gross profit			77,756			84,108
Selling, general and administrative expenses			(51,587)			(59,319)
Other income			969			1,207
Other expenses			(677)			(977)
Operating profit			26,461			25,018
Finance income			455			3,401
Finance expenses			(244)			(3,174)
Share of profit/(loss) of investments accounted for using			62			53
the equity method
Profit before income taxes			26,734			25,297
Income tax expenses			(7,963)			(7,904)
Profit for the period			18,771			17,393
Profit for the period attributable to:
Owners of the parent company			18,618			17,389
Non-controlling interests			152			4
Profit for the period		Y	18,771		Y	17,393

Earnings per share:		Yen			Yen
Basic earnings per share	Y	71.62		Y	67.60
Diluted earnings per share		71.42			67.40

3

Consolidated Statement of Comprehensive Income

Millions of yen

		Three months ended		Three months ended
			Jun. 30,		Jun. 30,
			2021		2022
Profit for the period		Y	18,771		17,393

Other comprehensive income, net of income tax

Items that will not be reclassified subsequently to profit or loss

Gains/(Losses) on investments in equity instruments designated as FVTOCI

Total of items that will not be reclassified subsequently to profit or loss

Items that may be reclassified subsequently to profit or loss

(745)(544)

(745)(544)

Exchange differences on translating foreign operations

Total of items that may be reclassified subsequently to profit or loss

Other comprehensive income for the period, net of income tax

Comprehensive income for the period

Comprehensive income for the period attributable to:

3,080	31,706
3,080		31,706
2,334		31,162
21,106	48,555

Owners of the parent company		20,948	48,551
Non-controlling interests		157		4
Comprehensive income for the period	Y	21,106	48,555

4

Consolidated Statement of Changes in Equity

Three months ended Jun. 30, 2021

		Equity attributable to owners of the parent company
					Other components
	Capital stock	Capital surplus	Retained earnings	Treasury stock	of equity
	Exchange differences
					on translating foreign
					operations
Balance as of Apr. 1, 2021	19,209	17,652	509,662	(2,477)	(60,998)
Profit for the period	-	-	18,618	-	-
Other comprehensive income	-	-	-	-	3,073
Total comprehensive income	-	-	18,618	-	3,073
for the period
Acquisition of treasury stock	-	-	-	(2)	-
Disposal of treasury stock	-	(16)	-	32	-
Dividends paid	-	-	(8,589)	-	-
Reclassification to retained earnings	-	-	(743)	- -	-
Total transactions with owners
-	(16)	(9,332)	29	-
Balance as of Jun. 30, 2021	19,209	17,636	518,949	(2,448)	(57,925)
	Equity attributable to owners of the parent company
	Other components of equity
	Gains/(Losses) on		Total	Non-controlling interests	Total equity
	investments in equity	Total
	instruments designated
	as FVTOCI
Balance as of Apr. 1, 2021	-	(60,998)	483,050	16,657	499,707
Profit for the period	-	-	18,618	152	18,771
Other comprehensive income	(743)	2,330	2,330	4	2,334
Total comprehensive income	(743)	2,330	20,948	157	21,106
for the period
Acquisition of treasury stock	-	-	(2)	-	(2)
Disposal of treasury stock	-	-	15	-	15
Dividends paid	-	-	(8,589)	(112)	(8,701)
Reclassification to retained earnings	743	743	-	-	-
Total transactions with owners
743	743	(8,576)	(112)	(8,688)
Balance as of Jun. 30, 2021	-	(57,925)	495,422	16,702	512,125
Three months ended Jun. 30, 2022
		Equity attributable to owners of the parent company
					Other components
	Capital stock	Capital surplus	Retained earnings	Treasury stock	of equity
	Exchange differences
					on translating foreign
					operations
Balance as of Apr. 1, 2022	19,209	17,866	554,910	(5,428)	(25,411)
Profit for the period	-	-	17,389	-	-
Other comprehensive income	-	-	-	-	31,706
Total comprehensive income	-	-	17,389	-	31,706
for the period
Acquisition of treasury stock	-	-	-	(5,419)	-
Disposal of treasury stock	-	(17)	-	17	-
Dividends paid	-	-	(8,801)	-	-
Reclassification to retained earnings	-	-	(544)	-	-
Total transactions with owners	-	(17)	(9,346)	(5,402)	-
Balance as of Jun. 30, 2022	19,209	17,849	562,953	(10,830)	6,295
	Equity attributable to owners of the parent company
	Other components of equity
	Gains/(Losses) on		Total	Non-controlling interests	Total equity
	investments in equity	Total
	instruments designated
	as FVTOCI
Balance as of Apr. 1, 2022	-	(25,411)	561,146	65	561,211
Profit for the period	-	-	17,389	4	17,393
Other comprehensive income	(544)	31,162	31,162	0	31,162
Total comprehensive income	(544)	31,162	48,551	4	48,555
for the period
Acquisition of treasury stock	-	-	(5,419)	-	(5,419)
Disposal of treasury stock	-	-	0	-	0
Dividends paid	-	-	(8,801)	-	(8,801)
Reclassification to retained earnings	544	544	-	-	-
Total transactions with owners	544	544	(14,221)	-	(14,221)
Balance as of Jun. 30, 2022	-	6,295	595,476	69	595,546

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