Freund : Results of Operations for the Third Quarter of the Fiscal Year Ending February 28, 2022

FREUND CORPORATION

Selected by the Japanese Ministry of Economy, Trade and Industry as a Global Niche Top 100 Company

(Securities code: 6312)

Results of Operations

for the Third Quarter of the Fiscal Year

Ending February 28, 2022

January 12, 2022

Copyright(C) 2022 Freund Corp. All rights reserved.

Consolidated Financial Summary for Q3 of FY2/22

Copyright(C) 2022 Freund Corp. All rights reserved.

Consolidated Financial Summary

• Sales, operating profit and ordinary profit increased YoY.
• Sales increase was driven by the machinery business as a result of the consolidation of Cos.Mec and higher sales of other group companies.
• Earnings in the first nine months of FY3/21 include a subsidy of more than 200 million yen received by a U.S. subsidiary. Operating and ordinary profit were up about 300 million yen after adjusting for this one‐time income.
• Higher chemicals business earnings, the result of a lower cost of sales, was the main reason for earnings growth.

 Profit decreased slightly due to impairment loss.		(Millions of yen)
		FY2/21	FY2/22	YoY Change
		Q3	Q3
		Actual	Actual	Amount	%
	Net sales	10,852	11,988	+1,135	+10.5
	Operating profit	391	459	+68	+17.4
	Ordinary profit	435	492	+57	+13.2
	Profit	277	270	(6)	(2.5)
	Earnings per share (yen)	(9.44)	8.69	+18.13	－
	Depreciation	300	436	+135	+45.2
	R&D expenses	382	455	+72	+18.9
	Dividend	－	－	－	－
				2
			Copyright (C) 2022 Freund Corp. All rights reserved.

Machinery Business: Group Company Performance

 Consolidated:	Sales increased and earnings were lower, although earnings increased YoY after adjusting for subsidy
	income one year earlier. Orders are strong.

• Freund Corporation: Sales and earnings remained unchanged YoY. Orders from overseas customers were sluggish.
• Freund-Vector: Sales increased and earnings were lower, although earnings increased YoY after adjusting for subsidy income one year earlier. Orders are strong from customers in the U.S., Brazil and other countries.

 Freund-Turbo:	Sales and earnings increased YoY. Sales in Japan are recovering.
 Cos.Mec:	Sales were held down by the impact of the pandemic in emerging countries, the primary
	market for this company.			(Millions of yen)
			FY2/21	FY2/22	YoY change
			Q3	Q3
			Amount	Amount	Amount		%
		Net sales	6,472	7,740	+1,267		+19.6
		FREUND CORPORATION	4,400	4,431	+31		+0.7
		FREUND-VECTOR	1,642	2,021	+379		+23.1
		FREUND-TURBO	906	1,066	+160		+17.7
		Cos.Mec	－	561	－	－
		Operating profit	357	262	(94)		(26.4)
		FREUND CORPORATION	384	396	+11		+2.9
		FREUND-VECTOR	27	(113)	(141)		(517.8)
		FREUND-TURBO	(54)	50	+105		－
		Cos.Mec	－	(70)	－	－
		Orders received	9,084	10,612	+1,528		+16.8
		FREUND CORPORATION	5,166	4,565	(601)		(11.6)
		FREUND-VECTOR	3,059	4,748	+1,688		+55.2
		FREUND-TURBO	858	908	+50		+5.9
		Cos.Mec	－	390	－	－
		Order backlog	7,389	9,626	+2,237		+30.3
		FREUND CORPORATION	4,707	4,826	+119		+2.5
		FREUND-VECTOR	2,148	3,768	+1,620		+75.4
		FREUND-TURBO	533	524	(8)		(1.6)
		Cos.Mec	－	506	－	－	3
				Copyright (C) 2022 Freund Corp.	All rights reserved.

Machinery Business: Sales by Region

• Growth outside Japan was mainly responsible for higher sales.

	USA:	Sales are recovering from the pandemic downturn one year earlier.
	Latin America:	Sales increased compared to the previous fiscal year as the effects of COVID-19 are gradually
			declining. The consolidation of Cos.Mec. contributed to sales.
	Europe:	Sales benefited from a large order in Ireland and the consolidation of Cos.Mec.
	Asia:	Lower sales in China were offset by higher sales in India and other countries.
								(Millions of yen)
				FY2/21	FY2/22	YoY change
				Q3	Q3
				Amount	Amount	Amount		%
		Net sales	6,472	7,740	+1,267		+19.6
		Japan		4,232	4,529	+297		+7.0
		Overseas	2,240	3,210	+970		+43.3
		USA	788	990	+202		+25.7
		Latin America	191	535	+344		+179.7
		Europe	258	558	+299		+115.8
		Asia	862	876	+14		+1.6
		Others	139	249	+109		+78.8
					Copyright (C) 2022 Freund Corp. All rights reserved.	4