Mercuria : Consolidated Financial Results for the Q1 of FY2022

Consolidated Financial Results

for the First Quarter of the Fiscal Year Ending December 31, 2022 (Three Months Ended March 31, 2022)

		[Japanese GAAP]
		May 12, 2022
Company name: Mercuria Holdings Co., Ltd.	Listing: Tokyo Stock Exchange
Stock code:	7347	URL: https://mercuria-hd.jp/en/
Representative:	Toshihiro Toyoshima, CEO
Contact:	Yusuke Takigawa, Executive Officer, Head of Finance & Control Department
	Tel: [phone]

Scheduled date of filing of Quarterly Report:	May 12, 2022
Scheduled date of payment of dividend:	-
Preparation of supplementary materials for quarterly financial results:	None
Holding of quarterly financial results meeting:	None

(All amounts are rounded down to the nearest million yen)

1. Consolidated Financial Results for the First Three Months of 2022 (January 1 to March 31, 2022)

(1) Consolidated results of operations					(Percentages represent year-on-year changes)
	Operating revenue	Operating profit		Ordinary profit		Profit attributable to
			owners of parent
	Million yen	%	Million yen		%	Million yen		%	Million yen		%
Three months ended Mar. 31, 2022	661	-	124		-	203		-	145		-
Three months ended Mar. 31, 2021	-	-	-		-	-		-	-		-

Note: Comprehensive income (millions of yen)	Three months ended Mar. 31, 2022:	865	(-%)
		Three months ended Mar. 31, 2021:	-	(-%)
	Net income per share	Diluted net income per share
		Yen	Yen
Three months ended Mar. 31, 2022		7.02	7.00
Three months ended Mar. 31, 2021		-	-

Note: The results of operations and year-on-year changes for the three months ended March 31, 2021 are not shown above as Mercuria Holdings was established on July 1, 2021 through a transfer of stock.

(2) Consolidated financial position

	Total assets	Net assets	Equity ratio
	Million yen	Million yen	%
As of Mar. 31, 2022		18,329	16,275	84.4
As of Dec. 31, 2021		18,010	15,821	83.9
Reference: Shareholders' equity (millions of yen)	As of Mar. 31, 2022: 15,476	As of Dec. 31, 2021: 15,108

2. Dividends

				Dividends per share
	1Q-end		2Q-end		3Q-end		Year-end	Total
		Yen	Yen		Yen		Yen	Yen
2021		-	-		-		20.00	20.00
2022		-
2022 (forecast)			0.00		-		20.00	20.00

Note: Revisions to the most recently announced dividend forecast: None

Note: Dividends for the ends of 1Q and 2Q of 2021 are not presented as Mercuria Holdings was established on July 1, 2021 through a transfer of stock.

3. Consolidated Forecast for 2022 (January 1 to December 31, 2022)

(Percentages represent year-on-year changes)

	Operating revenue	Operating profit	Ordinary profit		Profit attributable to	Net income per share
		owners of parent
	Million yen	%	Million yen	%	Million yen		%	Million yen	%	Yen
Full year	4,000	(4.1)	1,900	7.7	1,900		4.6	1,300	(0.3)	63.13
Note: Revisions to the most recently announced consolidated forecast: None

* Notes

1. Changes in significant subsidiaries during the period (change in scope of consolidation): None
2. Application of special accounting methods for presenting quarterly consolidated financial statements: Yes
3. Changes in accounting policies and accounting-based estimates, and restatements
4. 1. Changes in accounting policies due to revisions in accounting standards, others: Yes
   2. Changes in accounting policies other than 1) above: None
   3. Changes in accounting-based estimates: None
   4. Restatements: None
5. Number of shares issued (common stock)
6. 1. Number of shares issued at the end of the period (including treasury shares)

As of Mar. 31, 2022:	21,443,100 shares	As of Dec. 31, 2021:	21,443,100 shares
2) Number of treasury shares at the end of the period
As of Mar. 31, 2022:	848,677 shares	As of Dec. 31, 2021:	857,121 shares
3) Average number of shares during the period
Three months ended Mar. 31, 2022:	20,593,203 shares	Three months ended Mar. 31, 2021:	- shares

Note: Average number of shares during the three months ended March 31, 2021 are not presented as Mercuria Holdings was established on July 1, 2021 through a transfer of stock.

• The current financial report is not subject to quarterly review by certified public accountants or auditing firms.
• Cautionary statement with respect to forward-looking statements, and other special items
  Forecasts of future performance in this document are based on assumption judged to be valid and informat ion currently available to Mercuria Holdings' management, but are not promises by Mercuria Holdings regarding future performance. Actual results may differ materially from the forecasts for a number of reasons. Please refer to "1. Qualitative Information on Quarterly Consolidated Financial Performance, (3) Explanation of Consolidated Forecast and Other Forward -looking Statements" on page 2 for forecast assumptions and notes of caution for usage.

	Mercuria Holdings Co., Ltd. (7347) Financial Results for the First Quarter of 2022
Contents of Attachments
1. Qualitative Information on Quarterly Consolidated Financial Performance	2
(1)	Explanation of Results of Operations	2
(2)	Explanation of Financial Position	2
(3)	Explanation of Consolidated Forecast and Other Forward -looking Statements	2
2. Quarterly Consolidated Financial Statements and Notes	3
(1)	Quarterly Consolidated Balance Sheet	3
(2)	Quarterly Consolidated Statements of Income and Comprehensive Income	5
	Quarterly Consolidated Statement of Income
	For the Three-month Period	5
	Quarterly Consolidated Statement of Comprehensive Income
	For the Three-month Period	6
(3)	Notes to Quarterly Consolidated Financial Statements	7
	Going Concern Assumption	7
	Significant Changes in Shareholders' Equity	7
	Changes in Consolidated Subsidiaries during the Period	7
	Application of Special Accounting Methods for Presenting Quarterly Consolidated Financial Statements	7
	Changes in Accounting Policies	7
	Segment and Other Information	7
	Subsequent Events	7

1

Mercuria Holdings Co., Ltd. (7347) Financial Results for the First Quarter of 2022

1. Qualitative Information on Quarterly Consolidated Financial Performance

(1) Explanation of Results of Operations

On July 1, 2021, Mercuria Holdings Co., Ltd. was established as the parent company and s ole shareholder of Mercuria Investment Co., Ltd. by transferring all shares of Mercuria Investment to the new holding company. As there is no effective change in the scope of consolidation, comparisons with the first quarter of 2021 are comparisons with the first quarter of 2021 of Mercuria Investment.

During the first quarter of 2022 (January 1, 2022 to March 31, 2022), the outlook for the Japanese economy remained uncertain due to the prolonged impact of the COVID-19 pandemic, Russia's invasion of Ukraine and rising resource prices, among others.

To ensure medium to long-term growth in this environment, the Group will continue to strengthe n the support and monitoring of investee companies to increase investment returns of existing funds and thu s maximize performance fees.

There were activities involving new funds based on an investment strategy that reflects the current macroeconomic environment. One example is the participation of a fund in the Taiwan Mega-solar Development Project, which is expected to grow significantly, by making an investment of approximately one billion yen in a Taiwan mega-solar development company that is operated by business partner Maiora Asset Management Pte Ltd. In addition, subsidiary Mercuria Investment Co., Ltd. has establish ed the Mercuria Japan Industrial Growth Support Fund II (Buyout Fund II), which is focused on investments involving business succession at middle-market companies in Japan. This new fund has completed its initial closing of 26.4 billion yen.

In the first quarter of 2022, operating revenue was 661 million yen (down 16.7% year -on-year), ordinary profit was 203 million yen (down 45.1%), and profit attributable to owners of parent was 144 million yen (down 43.3%). Although operating revenue was lower than in the same period of 2021, the main reason is the substantial revenue in the first quarter of the previous year in the principal investing busin ess due to the transfer of solar power facilities to Enex Infrastructure Investment Corporation.

There is no segment information because the Mercuria Group operates only in the investment operations business segment.

(2) Explanation of Financial Position

Assets, Liabilities and Net Assets

Total assets amounted to 18,329 million yen at the end of the first quarter of 2022, an increase of 319 million yen over the end of 2021. The main reason was an increase of 1,986 million yen in operational investment securities mainly due to investments in a Taiwan mega-solar development company and changes in the market values of securities, while there were decreases of 1,318 million yen in cash and deposits and 193 million yen in deferred tax assets.

Total liabilities amounted to 2,054 million yen, a decrease of 134 million yen over the end of 2021. The main reasons were decreases of 215 million yen in accounts payable-other and 171 million yen in accrued expenses, while there was an increase of 259 million yen in unearned revenue.

Net assets totaled 16,274 million yen, an increase of 453 million yen over the end of 2021. The main reason was an increase of 519 million yen in valuation difference on available-for-sale securities, while there was a decrease of 273 million yen in retained earnings due to dividend payments.

(3) Explanation of Consolidated Forecast and Other Forward-looking Statements

At this point, there are no revisions to the consolidated earnings forecast for 2022, which was disclosed on February 10, 2022.

2

Mercuria Holdings Co., Ltd. (7347) Financial Results for the First Quarter of 2022

2. Quarterly Consolidated Financial Statements and Notes

(1) Quarterly Consolidated Balance Sheet

			(Thousands of yen)
		2021	First quarter of 2022
		(As of Dec. 31, 2021)	(As of Mar. 31, 2022)
Assets
Current assets
Cash and deposits	4,674,764	3,356,181
Trade accounts receivable	541,075	393,206
Operational investment securities	10,606,504	12,593,179
Operating loans	536,581	572,823
Advances paid	29,340	50,580
Other	411,802	357,511
Total current assets	16,800,068	17,323,480
Non-current assets
Property, plant and equipment
Buildings, net	72,951	63,840
Tools, furniture and fixtures, net	12,256	13,442
Total property, plant and equipment	85,206	77,282
Intangible assets
Software	282	226
Total intangible assets	282	226
Investments and other assets
Investment securities	280,965	280,965
Leasehold and guarantee deposits	75,247	73,827
Deferred tax assets	753,651	559,896
Other	14,706	13,567
Total investments and other assets	1,124,569	928,256
Total non-current assets	1,210,058	1,005,764
Total assets	18,010,126	18,329,244
Liabilities
Current liabilities
Current portion of long-term borrowings	130,000	130,000
Accounts payable-other	369,198	154,079
Accrued expenses	239,642	67,648
Accrued consumption taxes	-	4,934
Income taxes payable	144,956	73,771
Unearned revenue	-	259,018
Provision for bonuses	-	38,633
Other	52,373	84,048
Total current liabilities	936,169	812,132
Non-current liabilities
Long-term borrowings	743,500	711,000
Provision for retirement benefits for directors (and	102,000	102,000
other officers)
Provision for share-based remuneration for directors	162,794	167,169
(and other officers)
Provision for share-based remuneration for	12,500	14,375
employees
Retirement benefit liability	127,810	157,814
Long-term accounts payable-other	84,483	70,483
Long-term deposits received	19,337	19,407
Other	86	37
Total non-current liabilities	1,252,511	1,242,286
Total liabilities	2,188,680	2,054,418

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