Envipro : Financial Results Briefing Materials for the Nine Months Ended March 31, 2021

Financial Results Briefing Materials

for the Nine Months Ended March 31, 2021

Envipro Holdings Inc.

May 14, 2021

Table of Contents

1. Financial Overview for the Nine Months Ended March 31, 2021
2. Forecast for the Fiscal Year Ending June 30, 2021
3. Medium-toLong-Term Initiatives
4. Dividend Policy
5. Reference Data

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１. Financial Overview for the Nine Months Ended March 31, 2021

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Highlights for the Nine Months Ended March 31, 2021

Consolidated Financial Results
		（Down 1.5%	Year on year）
Net sales	¥26,874 million
Operating profit	¥1,250 million	（Up 39.9%	Year on year）
Ordinary profit	¥1,467 million	（Up 42.9%	Year on year）
Profit before income taxes	¥1,050 million	（Down 5.1%	Year on year）
Profit※	¥686 million	（Down 8.6%	Year on year）

Main Topics

• The ferrous scrap price (Tokyo Steel (Tahara) Tokkyu Grade Seaborne Price) increased from ¥24,500 at the end of the previous fiscal year to ¥41,000 at the end of the third quarter, and the average price during the nine months was ¥32,231, up from ¥23,607 at the same period of the previous fiscal year.
• The average market prices of gold, silver, copper, aluminum and nickel were also higher than in the same period of the previous fiscal year.
• Improved profitability by the revisions to waste disposal fee.
• In the LIBrecycling business, transactions with leading battery manufacturers started, and progress was made in the development of collection, production, analysis, and sales systems, however, ordinary loss of ¥100 million was incurred.
• Tight supply-demand balance of cargo ships and soaring ocean freight rates due to worldwide shortage of shipping containers.
• Reviewed the revenue plan for the LIB recycling business and recorded an impairment loss of ¥437 million (extraordinary loss).
• ¥320 million in Capital Investment (Inspection basis).
• In relation to the movement toward a decarbonized society, the evaluation of ferrous scrap utilization improved due to its CO₂ emission reduction effect.

※Profit：Profit attributable to owners of parent
※LIB：Lithium-ion rechargeable battery
（Amounts and quantities are rounded down. The percentages are rounded off.）	4

Summary of Consolidated Statements of Income

								（¥ million）
	2020/June	2021/June	Year on year
	1Q	－	3Q	1Q	－	3Q
	Actual	Actual	Increase/Decrease	Ratio

Net sales

Gross profit

Operating profit

Ordinary profit

Profit before income taxes

Profit※

Marginal profit※

EBITDA※

Fixed costs※

27,294 26,874

5,515 5,536

894 1,250

1,026 1,467

1,106 1,050

750686

5,267 5,503

1,313 1,814

4,362 4,269

▲ 419	▲1.5%
21	0.4%
356	39.9%
440	42.9%
▲ 56	▲5.1%
▲ 64	▲8.6%
236	4.5%
501	38.2%
▲ 92	▲2.1%

• Profit= Profit attributable to owners of the parent
• Marginal profit=Net sales - Variable costs
• EBITDA = Operating profit + Depreciation + Amortization of goodwill
• Fixed costs = [Cost of sales･Selling, General & administrative expenses・fixed cost equivalency of Non-operating expenses] -

※ Fixed costs = [Foreign exchange gains・non-operating income except equity method profit]	5