DMG Mori : Summary of Consolidated Financial Statements for the first quarter of Fiscal Year 2023 ended March 31, 2023 (IFRS basis)

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Note: This document has been translated from the Japanese original for reference purposes only.

In the event of any discrepancy between this translated document and the Japanese original document, the latter shall prevail.

Date: May 10, 2023

Summary of Consolidated Financial Statements for the First quarter of Fiscal Year 2023 ended March 31, 2023 (IFRS basis)

(All financial information has been prepared based on the original Japanese-language document, Summary of Consolidated Financial

Statements for the First quarter announced on May 10, 2023)

Listed company name:	DMG MORI CO., LTD.
Stock exchange listing:	Prime Section of Tokyo Stock Exchange
Code Number:	6141	URLhttps://www.dmgmori.co.jp
Company Representative:	Masahiko Mori, President
Contact Person:	Hirotake Kobayashi, Executive Vice President, Accounting / Finance HQ, Executive Officer
Phone:	[phone]

Filing date of quarterly financial statements: May 12, 2023

Estimated starting date of dividend payment: -

Preparation of supplementary explanatory materials: Yes

Holding of quarterly earnings release conference: Yes

1． Consolidated business results of the First quarter ended March 31, 2023 (January 1, 2023 to March 31, 2023)

(Note: All amounts less than one million are disregarded)

(1) Consolidated business results

(% of change from same period in the previous year)

Profit before income

Profit attributable to

Sales revenues

Operating profit

Quarterly profit

Comprehensive income

taxes

owners of the parent

million yen

%

million yen

%

million yen

%

million yen

%

million yen

%

million yen

%

First quarter

ended March 31, 2023 First quarter

ended March 31, 2022

123,225

107,262

14.9

32.2

9,695

9,451

2.6

137.1

8,480

(4.9)

8,917 184.5

(1.9)

6,314 247.0

6,297

0.4

6,271 246.0

7,251 (37.0)

11,510

113.5

	Basic earnings	Diluted earnings
	per share	per share
	Yen	Yen
First quarter
	46.70	46.70
ended March 31, 2023
First quarter
	46.66	46.66
ended March 31, 2022

(Note) Earnings per share is calculated based on the profit which excludes profit attributable to owners of other equity instruments.

1. Consolidated financial position

					Ratio of equity	Equity per share
				Equity attributable to
		Total assets	Total equity		attributable to owners of	attributable to
				owners of the parent
					the parent	owners of the parent
		million yen	million yen	million yen	%	yen
March 31, 2023		704,245	252,137	247,758	35.2	1,972.40
December 31, 2022		680,334	250,374	245,897	36.1	1,957.61
(Note) Ratio of equity attributable to owners of the parent and equity per share attributable to owners of the parent are based on the equity amount which includes
amounts of other equity instruments.

2．Dividends

				Dividends per share
Record Date	1Q		2Q	3Q	Year-end	Annual
	yen		yen	yen	yen	yen
December 31, 2022	-		30.00	-	40.00	70.00
December 31, 2023	-
December 31, 2023 (Forecast)			40.00	-	40.00	80.00
(Note) Revision of dividends forecast in the current quarter: No

3．Consolidated financial forecast for Fiscal Year 2023 (January 1, 2023 to December 31, 2023)

(% of change from same period in the previous year)

							Profit attributable to
	Sales revenues		Operating profit					Basic earnings per share
							owners of the parent
	million yen		%	million yen		%	million yen		%	yen
Full Year 2023	500,000		5.3	50,000		21.3	32,000		26.0	240.95

(Note)

Revision of consolidated financial forecast in the current quarter: No

・Exchange rate used for consolidated financial forecast for fiscal year 2023: JPY 130.0 /USD 140.0 /EUR

4. Others

1. Changes in significant subsidiaries during the First quarter ended March 31, 2023: No
2. Changes in accounting policies applied and changes in accounting estimates
3. 1. Changes in accounting policies required by IFRS: Yes
   2. Changes in accounting policies other than the above: No
   3. Changes in accounting estimates: No
4. Number of shares outstanding (Common shares)
5. 1. Number of shares outstanding at the end of the period (including treasury shares)

March 31, 2023:	125,953,683	December 31, 2022:	125,953,683
2. Number of treasury shares at the end of the period
March 31, 2023:	469,472	December 31, 2022:	472,396

3. Average number of outstanding shares during the period (cumulative from the beginning of the period)

January - March 2023: 125,482,817

January - March 2022: 125,048,820

(Note) The Company implemented trust-type employee stock ownership incentive plan in April 2018. Therefore, the shares of the company held by DMG MORI Employee Shareholders Association Exclusive Trust are included in the number of treasury shares at the end of period (0 shares as of December 31, 2022, and 0 shares as of March 31, 2023). In addition, the Company's shares held by the trust account are included in the treasury shares to be deducted in the calculation of the average number of

shares during the period (421,775 shares from January 1 to March 31, 2022, and 0 shares from January 1 to March 31, 2023). Notably, the trust was terminated in July 2022.

- Information regarding implementation of quarterly review procedures

These quarterly financial results are not subject to quarterly review procedures.

- Proper use of the financial forecasts and other notes (Precautions regarding future descriptions)

The above forecast is based on information available as of the release of this report and assumptions of several uncertain factors which may affect the company's results. Actual results might be different from the above estimates due to subsequent changes in the circumstances. Regarding Fiscal year 2023 (Forecast), please see "1. Qualitative Information Regarding Quarterly Settlement of Accounts (3) Explanation of forecasts and other projections" on page 3.

(How to obtain supplementary explanatory materials for quarterly financial results)

The supplementary explanatory material for the quarterly financial results is scheduled to be posted on the Company's website on May 10, 2023 (Wednesday).

(Attached Documents) Index
1. Qualitative Information Regarding Quarterly Settlement of Accounts	......................................................................................................................2
(1)	Explanation of operating results	2
(2)	Explanation of financial position	3
(3)	Explanation of forecasts and other projections	3
2．Quarterly Consolidated Financial Statements	4
(1)	Quarterly consolidated statement of financial position	4
(2)	Quarterly consolidated statement of profit or loss	6
(3)	Quarterly consolidated statement of comprehensive income	7
(4)	Quarterly consolidated statement of changes in equity	8
(5)	Quarterly consolidated statement of cash flows	10
(6)	Notes to going concern assumption	12
(7)	Notes to the quarterly consolidated financial statements	12

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1. Qualitative Information Regarding Quarterly Settlement of Accounts

1. Explanation of operating results

For the first quarter of the fiscal year 2023 (from January 1 to March 31), the sales revenues were JPY 123.2 bn. (EUR 867 mil.), the operating profit was JPY 9.7 bn. (EUR 68 mil.), the profit before income taxes was JPY 8.5 bn. (EUR 60 mil.) and the profit attributable to owners of the parent was JPY 6.3 bn. (EUR 44 mil.). (EUR amount is converted from yen at 142.1 yen, the average exchange rate between January 1 and March 31, 2023.)

The consolidated order intake for the first quarter was JPY 145.3 bn., down by -3.2%y-o-y. This is better than the initial forecast of a -10%y-o-y decline. In addition, the order intake significantly increased by 32% compared to the previous quarter (FY 2022 Oct-Dec). This increase is driven by the continuously solid demand for MX (Machining Transformation) - DMG MORI's solutions to drive process integration, automation, full turnkey, DX (Digital Transformation), and GX (Green Transformation). We have refined our value propositions and substantially increased the average unit price from JPY 49.8 mil. in FY2022 to 56.1 mil. The service and spare parts business, which accounts for approximately 20% of the consolidated order intake, also grew by 24%.

On a year-on-year basis, order intake decreased by -3% in Japan (composition rate: 13%), -2% in Europe (51%), -22% in the Americas (17%) and -7% in Asia (5%). In contrast, China (composition rate: 14%) marked a 33% increase and reached a new record. In the Americas, we have continued to receive a large number of inquiries. By industry, the energy industry is showing strong growth, while aerospace, medical, and electric vehicle (EV) industries are also solid. The semiconductor industry is in an adjustment phase, but the demand for machine tools remains stable among semiconductor manufacturing equipment makers.

We are currently maintaining our full-year consolidated order intake forecast of JPY 500 bn., but we may revise it once the second quarter results arrive. We will continue to promote MX and pursue new orders, but will remain cautious about global economic, interest rate, and financial developments. The order backlog has increased from JPY 254 bn. at the end of 2022 to 269 bn. at the end of March 2023. As it covers the planned production and sales volume for the whole of 2023, we are confident that we can achieve JPY 500 bn. in the full-year sales revenues. Now that we are on track to achieve this year's sales revenue target, we are also preparing a detailed financial forecast for the fiscal year 2024.

As stated in our Medium-term Business Plan 2025 (DMG MORI's 3-year business plan for 2023-2025), we aim to provide customers with high value- added products, systems, and services through process integration, automation, DX, and GX. To this end, we will build a resilient business foundation as a total solution provider to customers' processing needs.

In March 2023, we established the TULIP Experience Center (TEC) in Nagoya, where visitors can operate TULIP, a digital platform to support and improve shop floor operations. TULIP promotes DX and helps users improve productivity and quality in the entire shop floor. We also plan to open TECs in the Tokai and Hokuriku regions of Japan to provide first-hand experiences of TULIP to customers nationwide.

Additionally in April, we opened a new DMG MORI ACADEMY in Hamamatsu to offer private lessons to local customers. More academies will be opened in Kanazawa, Sendai, Okayama, and Fukuoka, which will allow more customers to experience our products.

As a new product, we released the "turnMASTER12in.C," a high-performance spindle that can be mounted on small turning centers and mill-turn centers. The slim design of the spindle unit improves machine performance and productivity. We will continue to develop highly functional, reliable, and investment-worthy products to meet the diverse needs of customers.

Regarding marketing activities, we hosted the Pfronten Open House at our production site in Pfronten, Germany, where customers could experience our cutting-edge technologies from January 30 to February 11. In April, we held the Innovation Days in Chicago, the U.S., and participated in CIMT 2023 in Beijing, China. Technology Fridays, our exclusive factory tour events, are also constantly held around the world. We will continue to use these digital and real-world opportunities to connect with our customers and understand their needs.

As stated in our Mission Statement, DMG MORI encourages employees to "Play Hard, Study Continuously, Work Together," and is committed to maintaining and improving employee well-being. To this end, we introduced the mandatory 12-hour interval between two working days in 2018, company-wide medical checkups in 2019, and smoke-free offices in 2020. As a result of these efforts, DMG MORI was certified as "White 500," one of the top 500 large enterprises in 2023 for excellent "Health and Productivity Management" by the Japanese Ministry of Economy, Trade and Industry, and Nippon Kenko Kaigi. We will continue to strengthen our initiatives for employee well-being.

DMG MORI is also making various efforts toward a sustainable, eco-friendly, and recycling-oriented society. We installed the first batch of solar panels at Iga Campus, Mie Prefecture, the group's largest production base, and started generating electricity in February. The current panel size will generate approximately 6 mil. kWh per year, covering about 13% of the annual demand in Iga. The second batch of solar panels will be installed in February 2024 and the third in December 2024. Together, the complete solar power system will supply around 30% of the annually required electricity.

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