Note:This document is a translation of a part of the original Japanese version and provided for reference purposes only. In the event of any discrepancy between the Japanese original and this English translation, the Japanese original shall prevail.

Consolidated Financial Results

for the Three Months Ended June 30, 2021

[Japanese GAAP]

August 12, 2021

Company name: Menicon Co., Ltd.

Stock exchange listing: Tokyo,Nagoya

Code number: 7780

URL: https://www.menicon.com

Representative: Hidenari Tanaka

CEO

Contact: Motonari Watanabe

Senior Executive Officer, Corporate Management

Phone: +81-52-935-1515

Scheduled date of filing quarterly securities report: August 12, 2021

Scheduled date of commencing dividend payments: -

Availability of supplementary briefing material on quarterly financial results: Yes

Schedule of quarterly financial results briefing session: No

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

1. Consolidated Financial Results for the Three Months Ended June 30, 2021 (April 01, 2021 to June 30, 2021)

(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, 2021

24,085

21.8

2,551

28.5

2,588

22.2

1,690

21.8

June 30, 2020

19,768

(4.1)

1,985

6.6

2,118

11.9

1,387

11.7

(Note) Comprehensive income:

Three months ended June 30, 2021:

Three months ended June 30, 2020:

¥

2,051 million

[

38.9%]

¥

1,476 million

[

38.0%]

Basic earnings

Diluted earnings

per share

per share

Three months ended

Yen

Yen

June 30, 2021

44.74

41.23

June 30, 2020

36.78

36.51

(Note) The Accounting Standard for Revenue Recognition (ASBJ Statement No. 29 issued March 31, 2020), etc. shall be applied from the beginning of the first quarter of the fiscal year under review. The figures for the Three Months Ended June 30, 2021 are after the application of the said accounting standards.

(2) Consolidated Financial Position

Total assets

Net assets

Capital adequacy ratio

As of

Million yen

Million yen

%

June 30, 2021

125,410

61,204

47.3

March 31, 2021

127,153

60,985

46.5

(Reference) Equity: As of

June 30, 2021:

¥

59,377 million

As of

March 31, 2021:

¥

59,144 million

(Note) 1. The Accounting Standard for Revenue Recognition (ASBJ Statement No. 29 issued March 31, 2020), etc. shall be applied from the beginning of the first quarter of the fiscal year under review. The figures for the Three Months Ended June 30, 2021 are after the application of the said accounting standards.

2. In the three months ended June 30, 2021, we finalized the provisional accounting treatment for business combinations. The figures for the fiscal year ended March 31, 2021 reflect the finalization of the provisional accounting treatment.

2. Dividends

Annual dividends

1st

2nd

3rd

Year-end

Total

quarter-end

quarter-end

quarter-end

Yen

Yen

Yen

Yen

Yen

Fiscal year ended March 31, 2021

-

0.00

-

35.00

35.00

Fiscal year ending March 31, 2022

-

Fiscal year ending March 31, 2022

0.00

-

17.50

17.50

(Forecast)

(Note) 1. Revision to the forecast for dividends announced most recently:

Yes

2. Effective October 1, 2021, we will conduct a 2-for-1 stock split of common stock. The dividend forecast for the fiscal year ending March 31, 2022 takes into account the said stock split. The year-end dividend per share for the fiscal year ending March 31, 2022 (forecast) without taking into account the stock split will be 35.00 yen.

3. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2022(April 01, 2021 to March 31, 2022)

(% indicates changes from the previous corresponding period.)

Net sales

Operating profit

Ordinary profit

Profit attributable

Basic earnings per

to owners of parent

share

Million yen

%

Million yen

%

Million yen

%

Million yen

%

Yen

Full year

99,200

15.1

9,000

11.0

8,800

5.4

5,700

(4.2)

75.39

(Note) 1.

Revision to the financial results forecast announced most recently: No

  • 2. Effective October 1, 2021, we will conduct a 2-for-1 stock split of common stock. The basic earnings per share in the consolidated financial result forecast for the fiscal year ending March 31, 2022 takes into account the stock split. The basic earnings per share in the consolidated financial result forecast for the fiscal year ending March 31, 2022 without taking into account the stock split will be 150.77 yen.

  • Notes:

(1) Changes in significant subsidiaries during the three months ended June 30, 2021

(changes in specified subsidiaries resulting in changes in scope of consolidation):

No

(2) Accounting policies adopted specially for the preparation of quarterly consolidated financial statements:

No

  1. Changes in accounting policies, changes in accounting estimates and retrospective restatement
    1. Changes in accounting policies due to the revision of accounting standards: Yes
    2. Changes in accounting policies other than 1) above: No
    3. Changes in accounting estimates: No
    4. Retrospective restatement: No
  2. Total number of issued shares (common shares)
    1. Total number of issued shares at the end of the period (including treasury shares):

June 30, 2021:

38,090,644

shares

March 31, 2021:

38,077,444

shares

2) Total number of treasury shares at the end of the period:

June 30, 2021:

287,955

shares

March 31, 2021:

287,876

shares

3) Average number of shares during the period:

Three months ended June 30, 2021:

37,792,047

shares

Three months ended June 30, 2020:

37,734,448

shares

  • This summary of financial results is exempt from audit procedures.
  • Explanation regarding appropriate use of business results forecasts and other special instructions
    • Forecasts regarding future performance presented in this material include the outlook for the future, assumptions on which the plan is based, and projections as of the date of announcement of this material. Actual results may differ from the forecasts presented in this material due to various factors.
    • For matters concerning the forecast of business results, please refer to "1. Qualitative Information on Quarterly Financial Results for the Period under Review (3) Explanation of Consolidated Business Results Forecast and Other Forward-looking Information" on Page 4 of the appendix.

Table of contents of appendix

1. Qualitative Information on Quarterly Financial Results for the Period under Review .....................

2

(1)

Explanation of Business Results...................................................................................................

2

(2)

Explanation of Financial Position ................................................................................................

4

(3)

Explanation of Consolidated Business Results Forecast and Other Forward-looking

Information.........................................................................................................................................

4

2. Quarterly Consolidated Financial Statements and Notes...................................................................

5

(1)

Quarterly Consolidated Balance Sheets.......................................................................................

5

(2)

Quarterly Consolidated Statements of Income and Comprehensive Income..............................

7

(3)

Notes to Quarterly Consolidated Financial Statements...............................................................

9

(Notes on going concern assumption)..............................................................................................

9

(Notes on significant changes in amount of shareholders' equity).....................................................

9

(Changes in accounting policies)......................................................................................................

9

(Additional information)................................................................................................................

10

(Segment information)...................................................................................................................

10

(Significant subsequent events)......................................................................................................

13

―1―

1. Qualitative Information on Quarterly Financial Results for the Period under Review

(1) Explanation of Business Results

According to the OECD economic outlook announced on May 31, 2021, despite an overall brighter outlook for the global economy, the status of economic recovery is reported to be uneven, depending on the effectiveness of public health measures and government support in each country. In addition, the outlook for the market environment remains uncertain due to the global prevalence of mutated strains of COVID-19. In Japan, a further state of emergency was declared in major metropolitan areas, and restrictions on outings and economic activities continued even after the declaration of a state of emergency was lifted, as evidence of a shift to focused anti- infection measures.

Under these circumstances, the overseas contact lens market overall is experiencing a recovery trend alongside economic activities as vaccinations against COVID-19 progress, and robust demand for orthokeratology lenses is continuing, particularly in China. The domestic contact lens market had continued to expand in recent years. In fiscal year 2020, the market expansion has stagnated due to the impact of COVID-19, but it is expected to recover along with the vaccination progress in future.

Performances in individual businesses are as follows. [Domestic Vision Care Business]

As for the trends in the domestic contact lens market, due to the impact of COVID-19, the value of cleanliness has been emphasized and the demand for daily disposable contact lenses is increasing. In addition, as wearing masks has become commonplace, circle lenses, which can be used as fashion items when wearing masks, are attracting attention.

The Group's Domestic Vision Care Business aims to expand the market share of daily disposable contact lenses, increase the number of MELS Plan members, and optimize members' lifetime value.

Regarding product strategy for the period under review, under such market conditions and policies, we have added "1 Day Menicon Rei," a daily disposable circle lens, to our MELS Plan product lineup. This product has received a favorable market response, and the number of members is growing steadily. In addition, we have added an astigmatic axis to "Magic toric," our daily disposable contact lenses for those with astigmatism equipped with SMART TOUCH design that makes it possible to hygienically and easily use the contact lenses without having to touch the inner lens surface, to improve the life of the contact lens. The "Magic" series uses around 80% less plastic in the contact lens packaging than conventional products, while the packaging itself is also environmentally friendly as it is made by recycling molded plastic that is no longer required in the manufacture of contact lenses.

As promotional measures, we developed the "1 Day Start-of-Spring Campaign" for our MELS Plan. For this campaign, we changed the campaign benefits to contributions to "MENICOiN, a point service provided by the Group. "MENICOiN" is convenient for the reason that it allows points to be exchanged for WAON points and nanaco points, etc. as well as lens care products, thereby contributing to an improved level of member satisfaction.

  • The name of the Domestic Contact Lens Business segment has been changed to the Domestic Vision Care Business as of the first quarter of the fiscal year under review.

[Overseas Vision Care Business]

In Europe, economic activities are recovering as vaccinations against COVID-19 progress. We are actively working on policies to develop new channels and strengthen relationships with important mass retailers to expand sales of disposable contact lenses and to strengthen the foundations of the myopia prevention business. In the period under review, we have started a new business with a mass retailer in Germany, and strengthen activities to increase our volume of business. In addition, we are continuing negotiations to start businesses with other mass retailers in Europe, and are preparing for further growth in the future.

In North America, vaccinations against COVID-19 are progressing, and economic activities are recovering. In the previous fiscal year, COVID-19 had a significant impact on our business, but with the recovery of economic activities and business progressing as planned, business results in both the contact lens business and lens care products business are steadily recovering. Going forward, we plan to systematically launch new products to put our business in this region back on a growth track.

In China, economic activities have picked up pace after recovering from the impact of COVID-19. The Group's business policy in the Chinese market is to expand sales of specialty contact lenses, including orthokeratology lenses, and lens care products by strengthening relationships with distributors, and to increase sales by expanding the lineup of other products. The sales network of the Itabashi Trading Group, which became a wholly-owned subsidiary in the previous fiscal year, made a significant contribution to an increase in net sales in the period under review, and both orthokeratology lenses and lens care products are performing well.

―2―

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Menicon Co. Ltd. published this content on 12 August 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 12 August 2021 05:10:11 UTC.