Escrit : Consolidated Financial Results for the Three Months Ended June 30, 2022

Consolidated Financial Results

for the Three Months Ended June 30, 2022

[Japanese GAAP]

August 12, 2022

Company name: ESCRIT INC.

Stock exchange listing: Tokyo Stock Exchange

Code number: 2196

URL: http://www.escrit.jp/

Representative: Morihiro Shibutani, Representative Director, CEO

Contact: Itaru Kichise, Director, CFO

Phone: [phone]

Scheduled date of filing quarterly securities report: August 12, 2022

Scheduled date of commencing dividend payments: ―

Availability of supplementary explanatory materials on quarterly financial results: Available

Schedule of quarterly financial results briefing session: Not scheduled

(Amounts of less than one million yen are rounded down.)

1. Consolidated Financial Results for the Three Months Ended June 30, 2022 (April 1, 2022 - June 30, 2022)

(1) Consolidated Operating Results		(% indicates changes from the previous corresponding period.)
		Net sales	Operating profit		Ordinary profit		Profit attributable to
				owners of parent
	Three months ended	Million yen	%	Million yen		%	Million yen		%	Million yen		%
	June 30, 2022	5,517	5.7	(138)		-	8		-	(45)		-
	June 30, 2021	5,219	493.5	(590)		-	(554)		-	412		-

(Note) Comprehensive income: Three months ended June 30, 2022: ¥(61) million [-%] Three months ended June 30, 2021: ¥409 million [-%]

	Basic earnings	Diluted earnings
	per share	per share
Three months ended	Yen	Yen
June 30, 2022	(7.51)	-
June 30, 2021	26.40	19.00

(Note) Although potential dilutive shares existed, diluted earnings per share for the three months ended June 30, 2022 are not stated herein because a net loss per share was recorded.

(2) Consolidated Financial Position
				Total assets	Net assets	Equity ratio
				Million yen		Million yen		%
	As of June 30, 2022				23,293		5,866		25.2
	As of March 31, 2022		24,584		5,928		24.1
	(Reference) Equity: As of June 30, 2022: ¥5,865 million
		As of March 31, 2022: ¥5,926 million
2. Dividends
							Annual dividends
			1st quarter-end	2nd quarter-end	3rd quarter-end	Year-end	Total
				Yen		Yen		Yen		Yen	Yen
	Fiscal year ended			-		0.00		-	0.00	0.00
	March 31, 2022
	Fiscal year ending			-
	March 31, 2023
	Fiscal year ending
	March 31, 2023					0.00		-	0.00	0.00
	(Forecast)

(Note) Dividends noted above are on common shares. As for the status of dividends for Class Shares (unlisted) with different rights from those of common shares of the Company, see "(Reference) Dividends Payable for Class Shares" below (available only in Japanese version).

3. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2023 (April 1, 2022 - March 31, 2023)

(% indicates changes from the previous corresponding period.)

	Net sales		Operating profit	Ordinary profit	Profit attributable	Basic earnings
		to owners of parent	per share
	Million yen		%	Million yen	%	Million yen	%	Million yen	%	Yen
Full year	25,741		15.7	500	-	500	-	300	(37.2)	5.55

(Note) Revision to the financial results forecast announced most recently: None

* Notes:

1. Changes in significant subsidiaries during the period under review: None
2. Accounting methods adopted particularly for the preparation of quarterly consolidated financial statements: None
3. Changes in accounting policies, changes in accounting estimates and retrospective restatement
4. 1. Changes in accounting policies due to the revision of accounting standards: None
   2. Changes in accounting policies other than 1) above: None
   3. Changes in accounting estimates: None
   4. Retrospective restatement: None
5. Total number of issued and outstanding shares (common shares)
6. 1. Total number of issued and outstanding shares at the end of the period (including treasury shares):

June 30, 2022:	13,786,500 shares
March 31, 2022:	13,786,500 shares
2) Total number of treasury shares at the end of the period:
June 30, 2022:	277,965 shares
March 31, 2022:	277,965 shares
3) Average number of shares during the period:
Three months ended June 30, 2022:	13,508,535 shares
Three months ended June 30, 2021:	13,508,568 shares

• These quarterly consolidated financial results are outside the scope of quarterly review by certified public accountants or an audit firm.
• Explanation of the proper use of financial results forecast and other notes (Notes on forward-looking statements)
  Earnings forecasts and other forward-looking statements herein are based on information currently available to the Company and certain assumptions deemed reasonable, and do not represent a commitment from the Company that they will be achieved. Actual results may differ significantly from the forecasts due to various factors.
  (Access to supplementary explanatory materials on financial results)
  Supplementary explanatory materials on financial results were posted on the Company's website on August 12, 2022.

2. Quarterly Consolidated Financial Statements

(1) Quarterly Consolidated Balance Sheets

(Thousand yen)

As of March 31, 2022

As of June 30, 2022

Assets

Current assets

Cash and deposits

Notes and accounts receivable - trade, and contract assets

Accounts receivable from completed construction contracts

Real estate for sale

Merchandise and finished goods

Raw materials and supplies

Costs on construction contracts in progress Other

Allowance for doubtful accounts

Total current assets

Non-current assets

Property, plant and equipment

6,124,998		5,381,891
274,460	383,025
429,263		103,319
364,610	337,393
270,338		281,958
65,168	57,715
33,019		121,010
721,404	653,870
(35,816)		(33,279)
8,247,448	7,286,904

Buildings and structures, net		6,338,772	6,102,482
Other	1,404,695	1,337,762
Total property, plant and equipment		7,743,468	7,440,245
Intangible assets	89,638	87,548
Investments and other assets
Leasehold and guarantee deposits	3,603,901	3,623,463
Deferred tax assets		4,593,154	4,547,184
Other	345,152	346,250
Allowance for doubtful accounts		(38,211)	(37,781)
Total investments and other assets	8,503,997	8,479,116
Total non-current assets		16,337,103	16,006,911
Total assets		24,584,551	23,293,816

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			(Thousand yen)
		As of March 31, 2022	As of June 30, 2022
Liabilities
Current liabilities
Notes and accounts payable - trade		992,352	592,857
Short-term borrowings	5,041,500	5,004,000
Current portion of long-term borrowings		1,405,298	1,393,514
Accounts payable - other	702,854	634,690
Income taxes payable		31,693	8,940
Contract liabilities	1,606,727	1,296,978
Asset retirement obligations		138,783	115,036
Other	1,868,956	1,137,464
Total current liabilities		11,788,166	10,183,481
Non-current liabilities
Bonds payable		210,000	210,000
Long-term borrowings	3,714,393	4,099,186
Asset retirement obligations		2,456,648	2,471,024
Other	486,759	463,468
Total non-current liabilities		6,867,801	7,243,679
Total liabilities	18,655,967	17,427,160
Net assets
Shareholders' equity
Share capital		50,000	50,000
Capital surplus	4,613,178	4,613,178
Retained earnings		1,483,871	1,438,566
Treasury shares	(192,505)	(192,505)
Total shareholders' equity		5,954,544	5,909,239
Accumulated other comprehensive income
Valuation difference on available-for-sale securities		85	(165)
Foreign currency translation adjustment	(28,017)	(43,606)
Total accumulated other comprehensive income		(27,932)	(43,771)
Share acquisition rights	1,971	1,187
Total net assets		5,928,583	5,866,655
Total liabilities and net assets		24,584,551	23,293,816

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1. Quarterly Consolidated Statements of Income and Comprehensive Income
   Quarterly Consolidated Statements of Income Three Months Ended June 30

			(Thousand yen)
		For the three months ended	For the three months ended
		June 30, 2021	June 30, 2022
		(From April 1, 2021	(From April 1, 2022
		to June 30, 2021)	to June 30, 2022)
Net sales		5,219,008	5,517,016
Cost of sales	2,554,969	2,274,457
Gross profit		2,664,039	3,242,558
Selling, general and administrative expenses	3,254,600	3,380,941
Operating profit (loss)		(590,561)	(138,382)
Non-operating income
Outsourcing service income		4,264	-
Subsidies for employment adjustment	101,914	44,641
Subsidy income		18,174	172,476
Other	7,491	19,699
Total non-operating income		131,844	236,817
Non-operating expenses
Interest expenses		19,663	18,315
Commission expenses for financial services	68,551	67,464
Other		8,042	3,938
Total non-operating expenses	96,258	89,717
Ordinary profit (loss)		(554,975)	8,718
Extraordinary income
Gain on reversal of share acquisition rights		18	784
Total extraordinary income	18	784
Profit (loss) before income taxes		(554,957)	9,502
Income taxes - current	25,161	8,785
Income taxes - deferred		(992,852)	46,021
Total income taxes	(967,690)	54,807
Profit (loss)		412,733	(45,304)
Profit (loss) attributable to owners of parent		412,733	(45,304)

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