DMG Mori : Summary of Consolidated Financial Statements for the second quarter of Fiscal Year 2022 ended June 30, 2022 (IFRS basis)

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: August 4, 2022

Summary of Consolidated Financial Statements for the second quarter of Fiscal Year 2022 ended June 30, 2022 (IFRS basis)

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

Statements for the second quarter announced on August 4, 2022)

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: August 15, 2022

Estimated starting date of dividend payment: September 9, 2022

Preparation of supplementary explanatory materials: Yes

Holding of quarterly earnings release conference: Yes

1． Consolidated business results of the second quarter ended June 30, 2022 (January 1, 2022 to June 30, 2022)

													(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	%
Second quarter
		218,207	22.4		17,688		73.3	16,273	90.5	11,390		86.4	11,296	85.3	34,944	158.7
ended June 30, 2022
Second quarter
		178,246	15.5		10,208		320.1	8,544	-	6,111		-	6,097	-	13,506	-
ended June 30, 2021
		Basic earnings		Diluted earnings
		per share			per share
			Yen					Yen
Second quarter
			83.23					83.23
ended June 30, 2022
Second quarter
			40.57					40.53
ended June 30, 2021
(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 attributable to		Equity per share attributable to
	Total assets	Total equity		attributable to owners of
			owners of the parent		owners of the parent
				the parent
	million yen	million yen	million yen	%	yen
June 30, 2022	693,871	248,559	244,253	35.2	1,944.71
December 31, 2021	597,117	217,279	213,139	35.7	1,703.51
(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, 2021	-	10.00	-	30.00	40.00
December 31, 2022	-	30.00
December 31, 2022 (Forecast)			-	40.00	70.00

(Note) Revision of dividends forecast in the current quarter: No

3．Consolidated financial forecast for Fiscal Year 2022 (January 1, 2022 to December 31, 2022)

(% 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 2022	450,000		13.6	45,000		95.1	28,000		108.0	209.80

(Note)

Revision of consolidated financial forecast in the current quarter: No

・Exchange rate used for consolidated financial forecast for fiscal year 2022: JPY 120.0 /USD 135.0 /EUR

4. Others

1. Changes in significant subsidiaries during the second quarter ended June 30, 2022: No
2. Changes in accounting policies applied and changes in accounting estimates
3. 1. Changes in accounting policies required by IFRS: No
   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)

June 30, 2022:	125,953,683	December 31, 2021:	125,953,683
2. Number of treasury shares at the end of the period
June 30, 2022:	485,039	December 31, 2021:	984,204

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

January - June 2022: 125,200,543

January - June 2021: 124,342,276

(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 (499,500 shares as of December 31, 2021, and 6,600 shares as of June 30, 2022). 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 (813,300 shares from January 1 to June 30, 2021, and 271,629 shares from January 1 to June 30, 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 2022 (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 August 4, 2022 (Thursday).

(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 half of the fiscal year 2022 (from January 1 to June 30), the gross margin continued to improve thanks to the high demand for process integration, automation, and digitization. Accordingly, the sales revenues were JPY 218.2 bn. (EUR 1,625 mil.), the operating profit was JPY 17.7 bn. (EUR 132 mil.), the profit before income taxes were JPY 16.3 bn. (EUR 121 mil.), the profit attributable to owners of the parent was JPY 11.3 bn. (EUR 84 mil.). (Euro amount is converted from yen at 134.3 yen, the average exchange rate between January 1 and June 30, 2022). The operating profit margin for the first half of 2022 was 8.1% due to the increased logistics cost and other factors. We are aiming to reach over 10% in operating profit margin in the second half of 2022.

The ongoing positive trend in the first half of 2022 resulted in a consolidated order intake of JPY 299.3 bn., an increase of 37% year-on-year. Among the driving factors were the accelerating demand for automation and full turnkey production with 5-axis and mill-turn machines, and large projects from global companies. The consolidated order intake was boosted by an increased average machine unit price of JPY 49.6 mil. (FY2021 average: JPY 39.4 mil.), which was achieved thanks to value-adding proposals to customers and the weak yen. The group company Magnescale Co., Ltd. made a significant contribution by achieving a high order intake through its production and sales of ultra-precision measuring components for semiconductor equipment. Service and Spare Parts also contributed by an order intake increase of 24% year-on-year.

Compared to the first half of fiscal year 2021, the order intake increased in all regions. Japan increased by 54% (composition ratio: 13%), Americas by 49% (19%), Europe by 32% (51%), China by 20% (11%) and Asia excluding China by 51% (6%). The order intake also continues to be strong across all industries, especially in industries such as medical, space, die & mold, EV, decarbonization technology and semiconductor production equipment.

We expect orders for machine tools, especially in combination with process integration, automation, and digitization to continue to grow throughout the third quarter and beyond. Therefore, the order intake forecast for the fiscal year 2022 has been revised upward again to exceed JPY 530 bn. (Initial plan: JPY 480 bn.). In addition, the order backlog is expected to increase from JPY 164 bn. at the end of 2021 to JPY 244 bn. at the end of June 2022, and to around JPY 240-250 bn. at the end of December 2022. With a generous amount of order backlog, we will strive to further stabilize our business performance.

As mentioned in DMG MORI's Mission Statement, we aim to provide comprehensive processing automation systems to customers, combining hardware and software components and optimized after-sales services. In other words, DMG MORI offers machine tools, unique products, internally produced components, and peripheral equipment and thereafter establishes processing systems at customers' facilities, upgrades machining processes for higher productivity, maintains the systems, or offers financing.

On April 1, 2022, DMG MORI established "WALC Inc.", a new subsidiary that specializes in AI, IoT and cloud computing technology and so on. By providing advanced software solutions, WALC Inc. aims at promoting the digital transformation of manufacturing companies. The company is also actively recruiting and offering internships to develop talents in the IT industry.

Furthermore, DMG MORI has released the "Academic Package" to easily provide the e-learning courses of DMG MORI's Digital Academy to educational institutions, including high schools, technical colleges, universities, and vocational training schools. We also launched the "Process Design Advisor" with video contents to study indexed 5-axis machining for up to 100 workpiece types as part of the "Skill Up Service" on DMG MORI's customer portal "my DMG MORI". We will continue to expand the learning contents for 5-axis machining and mill-turn machines to further support customers in improving their productivity.

As for technological innovation, we released the software "CELOS DYNAMICpost" to easily connect CAM technology with our DMG MORI machines. CELOS DYNAMICpost offers all 3 necessary functions of post-processing, machining simulation and cutting-force optimization in one integrated software, sparing customers the need of purchasing separate software products. In addition, DMG MORI has launched its new machine NTX 500, the most compact mill-turn center in the NTX series for processing of small-size & complex-shaped workpieces on 1 machine. The NTX series is specialized in integrating milling and turning processes, and the newly developed NTX 500 has the smallest floor space in the series. We will continue to develop highly functional, reliable, and investment-worthy products to meet the diverse needs of customers.

On the sales front, we are improving the communication quality with customers by enhancing our digital contents and increasing opportunities for direct consultations. In May, we held our Open House event at our production site in Pfronten, Germany. In June and July, we also participated in the Robot Technology Japan 2022 exhibition held in Aichi Prefecture, Japan. We also continue to hold small-scale exhibitions "Technology Fridays" at our locations worldwide. We will continue to connect with our customers both digitally and in the real world to make the optimal proposals to their needs.

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