Nippon Sheet Glass : 2023/3 1st Quarter Consolidated Financial Results (3 Months to June 2022) 

Nippon Sheet Glass Company, Limited [5202] FY 2023 1st Quarter Consolidated Financial Results

FY 2023 1st Quarter Consolidated Financial Results 5 August 2022

(English translation of the Japanese original)

Listed Company Name:	Nippon Sheet Glass Company, Limited
Code Number:		5202
Representative:	Representative Executive Officer,	Name:
President and CEO
Inquiries to:	General Manager,	Name:
Investor Relations

Stock Exchange Listing:	Tokyo
(URL: http://www.nsg.com)
Shigeki Mori
Hiroyuki Genkai
Tel:	[phone]

Submission of quarterly report to MOF:	9 August 2022	Payment of dividends start from: N/A
Quarterly result presentation papers:	Yes
Quarterly result presentation meeting:	Yes	(Teleconference for institutional investors)

1. Consolidated business results for FY 2023 1st Quarter (From 1 April to 30 June 2022)

1. Consolidated business results

									Profit		Total
					Profit before	Profit for the	attributable to
	Revenue	Operating profit	comprehensive
	taxation		period		owners of the
							income
									parent
	¥ millions	%	¥ millions	%	¥ millions	%	¥ millions	%	¥ millions	%	¥ millions	%
1Q FY 2023	177,909	20.5	8,265	15.4	8,817	59.5	3,292	14.3	2,382	(6.3)	34,752	193.1
1Q FY 2022	147,678	60.7	7,161	-	5,529	-	2,880	-	2,541	-	11,855	-
	Earnings per
	share - basic
1Q FY 2023	¥	20.88
1Q FY 2022	¥	22.66

Note: Operating profit in the above table is defined as being operating profit stated before exceptional items.

(2) Changes in financial position

				Total	Total
		Total assets	Total equity	shareholders'	shareholders'
				equity	equity ratio
		¥ millions	¥ millions	¥ millions	%
FY 2023	1st Quarter	1,003,513	209,646	181,485	18.1
FY 2022	Full year	939,281	169,355	145,291	15.5

2. Dividends

				Dividends per share
			1st Quarter	2nd Quarter	3rd Quarter		4th Quarter	Annual
FY 2022	(Actual)		-	¥ 0.00	-		¥ 0.00	¥	0.00
FY 2023	(Actual)		-
FY 2023	(Forecast)			¥ 0.00	-		¥ 0.00	¥	0.00
Note:	• There have been no changes to the forecast dividends this quarter.

• The above table shows dividends on common shares. Please refer to "(Reference) Dividends for Class A Shares" for information regarding dividends on Class A shares, which are unlisted and have different rights from common shares.

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Nippon Sheet Glass Company, Limited [5202] FY 2023 1st Quarter Consolidated Financial Results

3. Forecast for FY 2023 (From 1 April 2022 to 31 March 2023)

						Profit before	Profit for the	Profit attributable	Earnings
		Revenue		Operating profit	to owners of the	per share
			taxation		period
								parent		- basic
		¥ millions	%	¥ millions	%	¥ millions	%	¥ millions	%	¥ millions	%	¥
Half year		360,000	23.8	11,000	(13.4)	9,000	(38.9)	4,000	(58.1)	3,000	(65.1)	22.26
Full year		690,000	14.9	18,000	(9.9)	11,000	(7.2)	5,000	(26.0)	4,000	(3.2)	22.56
Note:	•	There have been changes to the forecast results this quarter.

• Forecast of basic earnings per share for FY2023 is calculated by dividing the profit attributable to owners of the parent after deducting preferred dividends for Class A shares (a rate of 6.5% per annum applied to the outstanding balance at 31 March 2023), by 90,849,692 shares which is the number of ordinary shares issued at 30 June 2022, reduced by the number of treasury stock and restricted shares (144,200 shares).
• For details, please refer to the "Revision of Forecast for 2023/3" and the slides on 2023/3 forecast in 2023/3 First Quarter Results presentation.

4. Other items

1. Changes in status of principle subsidiaries --- No
2. Changes implemented to the accounting policies, practice and presentations related to the preparation of quarterly consolidated financial statements
3. 1. Changes due to revisions in accounting standards under IFRS --- No
   2. Changes due to other reasons ---No
   3. Changes in accounting estimates --- No
4. Numbers of shares outstanding (common stock)
5. 1. Number of shares issued at the end of the period, including shares held as treasury stock:
      91,019,899 shares as of 30 June 2022 and 91,000,199 shares as at 31 March 2022
   2. Number of shares held as treasury stock at the end of the period:
      26,007 shares as at 30 June 2022 and 25,700 shares as at 31 March 2022
   3. Average number of shares in issue during the period, after deducting shares held as treasury stock: 90,823,185 shares for the period ending 30 June 2022 and 90,673,471 shares for the period ending 30 June 2021

Status of quarterly review procedures taken by external auditors for the quarterly resultsThis document (Tanshin) is out of scope for quarterly review by the external auditors.

Explanation for the appropriate usage of performance projections and other special items

The projections contained in this document are based on information currently available to us and certain assumptions that we consider to be reasonable. Hence the actual results may differ. The major factors that may affect the results include but are not limited to the economic and competitive environment in major markets, product supply and demand shifts, currency exchange and interest rate fluctuations, changes in supply of raw materials and fuel and changes and laws and regulations.

(For Reference) Dividends for Class A Shares

Dividends per share related to Class A Shares with different rights from those of common shares are as follows.

				Dividends per share
	1st Quarter		2nd Quarter	3rd Quarter		4th Quarter	Total
Class A Shares
FY2022 (Actual)		-	¥ 0.00	-		¥ 65,000.00	¥ 65,000.00
FY2023 (Actual)		-
FY2023 (Forecast)			¥ 0.00	-		¥ 65,000.00	¥ 65,000.00

(Note) Number of Class A Shares in issue are 30,000 shares. 40,000 Class A Shares were originally issued on 31 March 2017. On 7 December 2018, the Company acquired and then retired a total of 5,000 Class A shares. On 6 June 2019, the Company acquired and then retired a total of 5,000 Class A shares. The forecast of dividends, for Class A shares that have dividend record dates belonging to FY2023, is ¥ 1,950 million.

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Nippon Sheet Glass Company, Limited [5202] FY 2023 1st Quarter Consolidated Financial Results

[Attachments]

Table of contents in the attachments (including mandatory disclosure items)

1. Narratives about financial results
2. 1. Business Performance
   2. Financial Condition
   3. Prospects
3. Consolidated financial statements and their notes
4. 1. (a) Condensed quarterly consolidated income statement
      (b) Condensed quarterly consolidated statement of comprehensive income
   2. Condensed quarterly consolidated balance sheet
   3. Condensed quarterly consolidated statement of changes in equity
   4. Condensed quarterly consolidated statement of cash flow
   5. Notes to the condensed quarterly consolidated financial statements

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Nippon Sheet Glass Company, Limited [5202] FY 2023 1st Quarter Consolidated Financial Results

1. Narratives about financial results

1. Business Performance
   (a) Background to Results

The Group experienced mixed market conditions during the first quarter of the year. Architectural markets were strong, with buoyant demand enabling the recovery of surging input costs through sales price increases. Demand for solar energy glass was also positive. Automotive markets continue to be negatively affected by a shortage of semiconductors in the automotive supply chain, severely impacting the ability of the Group's customers to meet underlying consumer demand. Technical glass markets were positive, with demand for the Group's products improving across many areas.

Group revenues increased by 20 percent to ¥ 177,909 million (1Q FY2022 ¥ 147,678 million), with the majority of the improvement being in the Architectural business. At constant exchange rates, cumulative revenues would have increased by 13 percent. Operating profits were ¥ 8,265 million (1Q FY2022 ¥ 7,161 million). Net exceptional gains of

• 2,335 million reflected an additional settlement agreed with the Group's insurer and broker following damage to the Group's facility at Ottawa, Illinois, U.S.A, as a consequence of a Tornado on 28 February 2017. Taxation charges of
• 5,525 million (1Q FY2022 ¥ 2,649 million) are calculated based on the effective rate expected for the full-year. As a consequence of the improving operating profit and the exceptional credit, offset by higher taxation charges, the Group recorded a positive profit attributable to owners of the parent of ¥ 2,382 million (1Q FY2022 ¥ 2,541 million).

1. Review by Business Segment

The Group's business lines cover three core product sectors: Architectural, Automotive, and Technical Glass.

Architectural, representing 48 percent of cumulative revenues, includes the manufacture and sale of flat glass and various interior and exterior glazing products within the commercial and residential markets. It also includes glass for the Solar Energy sector.

Automotive, with 46 percent of cumulative revenues, supplies a wide range of automotive glazing for new vehicles and for replacement markets.

Technical Glass, representing 6 percent of cumulative revenues, comprises several discrete businesses, including the manufacture and sale of very thin glass used as cover glass for displays, lenses and light guides for printers, and glass fiber components for engine timing belts.

Other operations include corporate costs, consolidation adjustments, certain small businesses not included in the segments covered above and the amortization of other intangible assets related to the acquisition of Pilkington.

The table below shows a summary of cumulative results by business segment.

¥ millions	Revenue	Operating profit/(loss)
	1st Quarter	1st Quarter	1st Quarter	1st Quarter
	FY 2023	FY 2022	FY 2023	FY 2022
Architectural	85,605	64,497	8,879	6,113
Automotive	81,552	70,878	(705)	1,251
Technical Glass	9,944	11,378	3,233	2,849
Other Operations	808	925	(3,142)	(3,052)
Total	177,909	147,678	8,265	7,161

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Nippon Sheet Glass Company, Limited [5202] FY 2023 1st Quarter Consolidated Financial Results

Architectural Business

The Architectural business recorded cumulative revenues of ¥ 85,605 million (1Q FY2022: ¥ 64,497 million) and an

operating profit of ¥ 8,879 million (1Q FY2022: ¥ 6,113 million).

Architectural revenues and profits increased from the previous year with robust volumes and higher selling prices, substantially offsetting increased input costs.

In Europe, representing 45 percent of the Group's architectural sales, revenues improved significantly with buoyant demand resulting in positive volumes and rising price levels. The increased selling prices substantially offset higher input costs, which remain very high, especially for energy.

In Asia, representing 27 percent of the Group's architectural sales, revenues and profits were above the previous year. Sales volumes increased and a positive operational performance helped mitigate the effect of increasing input costs.

In the Americas, representing 28 percent of the Group's architectural sales, revenues and profits were ahead of the previous year. Customer demand was positive, although North American logistics constraints continue to negatively affect sales volumes.

Automotive Business

The Automotive business recorded cumulative revenues of ¥ 81,552 million (1Q FY2022: ¥ 70,878 million) and an

operating loss of ¥ 705 million (1Q FY2022: profit of ¥ 1,251 million). Volumes continued to be at low levels across most regions, with the increase in consolidated revenues being partly due to the weakening Japanese yen.

Europe represents 41 percent of the Group's automotive sales. Revenues increased, due largely to foreign exchange movements, with overall volumes being negatively affected by a shortage of semi-conductor components at the Group's customers. Profitability was also affected by increasing input costs. Negotiations with customers to offset the increased input costs with higher selling prices are continuing. Volumes in glass replacement markets were positive.

In Asia, representing 18 percent of the Group's automotive sales, revenues and profitability fell from the previous year. Japanese volumes remain under pressure, with vehicle makers unable to fulfil demand due to supply constraints, including semi-conductor shortages.

In the Americas, representing 41 percent of the Group's automotive sales, revenues increased from the previous year whilst profits were flat. Demand in North America was adversely impacted by supply chain disruptions, particularly with respect to semi-conductor components. Demand in South America was relatively strong however, with volumes improving in Argentina.

Technical Glass Business

The Technical Glass business recorded cumulative revenues of ¥ 9,944 million (1Q FY2022: ¥ 11,378 million) and an

operating profit of ¥ 3,233 million (1Q FY2022: ¥ 2,849 million).

Revenues fell in the Technical Glass business due to the disposal of the Battery Separator division during the previous year. Profits improved, with strengthening market conditions across continuing businesses.

In the fine glass business, continued cost reduction efforts and a better sales mix underpinned a further improvement in financial results. In the information devices business, demand for printer lenses continued to be supported by work from home demand, although volumes also reflected a shortage of semi-conductor components at the Group's customers. Whilst underlying consumer demand was stable, volumes of glass cord used in engine timing belts were also impacted by supply chain issues at the Group's customers. Metashine sales fell slightly as a consequence of difficult conditions in automotive markets.

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