Nippon Suisan Kaisha : Consolidated Financial Report for the 1st Quarter of the Fiscal Year 2021 (April 1, 2021, through June 30, 2021)

August 4, 2021

Consolidated Financial Report for the 1st Quarter of the Fiscal Year 2021 (April 1, 2021, through June 30, 2021)

Qualification: This is directly translated into English for readers' convenience, and all financial results conform with the accounting principles generally accepted in Japan.

Company: Nippon Suisan Kaisha, Ltd.	Listed on Tokyo Stock Exchange with the register code 1332
	https://www.nissui.co.jp/english/index.html

1. Consolidated Financial Data of 1st Quarter of FY2021

1. Consolidated Financial Results (For three months ended June 30, 2021)

(Amounts less than one million yen are omitted)

	Net Sales		Operating profit	Ordinary profit	Profit attributable to
		owners of parent
	Million yen	%	Million yen	%	Million yen	%	Million yen	%
1st Quarter of FY2021	165,407	8.9	7,049	66.7	7,495	52.0	5,186	63.5
1st Quarter of FY2020	151,952	-	4,229	-	4,930	-	3,172	-

(Note) Comprehensive income of 1st quarter of FY2021	8,805 Million yen (449.0%) 1st quarter of FY2020 1,603 Million yen (-%)
	Earnings per share	Diluted income per
		share
	Yen		Yen
1st Quarter of FY2021	16.67		-
1st Quarter of FY2020	10.20		-

(Note) Nissui has adopted the "Accounting Standard for Revenue Recognition" (ASBJ Statement No.29, March 31, 2020), etc., from the first quarter of the current consolidated fiscal year. Accordingly, all figures for the first quarter of the fiscal year ended March 31, 2021, have been retroactively adopted to the above accounting standards; thus, we do not describe the difference in percentage between the previous fiscal year and the year before.

(2) Consolidated Financial Position of 1st Quarter

	Total assets	Net assets	Equity ratio
	Million yen	Million yen	%
1st Quarter of FY2021	496,248	194,741	35.5
FY2020	475,468	187,779	35.6

Ref.): Total shareholders' equity

As of June 30, 2021 176,381 Million yen As of March 31, 2021 169,427 Million yen

(Note) Nissui has adopted the "Accounting Standard for Revenue Recognition" (ASBJ Statement No 29, March 31, 2020), etc., from the first quarter of the current consolidated fiscal year. Accordingly, the figures for the first quarter of the fiscal year ended March 31, 2021, have been retroactively adopted to the above accounting standards.

2. Dividend

		Dividend per share
	1st Quarter	2nd Quarter	3rd Quarter		4th Quarter	Fiscal Year
	Yen	Yen	Yen		Yen	Yen
FY2020	-	4.0	-		5.5	9.5
FY2021	-
FY2021(forecast)		4.5	-		5.0	9.5

(Note) Revision to dividend forecast during the current quarter: None

Consolidated

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3. Consolidated Forecast for FY2021(April 1, 2021, through March 31, 2022)

	Net Sales		Operating profit	Oridnary profit	Profit attributable to	Net income
		owners of parent	per share
	Million yen	%	Million yen	%	Million yen	%	Million yen	%	yen
FY2021	642,000	4.4	20,000	11.1	23,000	1.5	15,000	4.2	48.21

(Note) Revision during the current quarter to the consolidated forecast for FY2021: None

(Note) Nissui has adopted the "Accounting Standard for Revenue Recognition" (ASBJ Statement No.29, March 31, 2020), etc., from the first quarter of the current consolidated fiscal year. Accordingly, the percentage change from the previous year has retroactively adopted to the above accounting standard.

• Notes
• 1. Changes in the scope of consolidation due to transfer of significant subsidiaries during the term: None
  2. Adoption of accounting treatment unique to the preparation of quarterly consolidated financial statement: None
  3. Changes in accounting policy, Changes in accounting estimate, and restatement:
  4. 1. Changes in accounting policy associated with the revision of the accounting standard, etc.: Yes
     2. Changes in accounting policy other than those stated above: None
     3. Changes in accounting estimate: None
     4. Restatement: None
  5. Number of issued shares (Common stock)
  6. 1. Number of issued shares at the end of the

term (Including treasury stock)	1Q of FY2021	312,430,277	FY2020	312,430,277
ii. Number of treasury stock at the end of the	1Q of FY2021	1,297,163	FY2020	1,296,387
term
1Q of FY2021	311,133,511	1Q of FY2020	311,141,123
iii. The average number of shares during the

term (For the current consolidated first quarter)

(Note) Nissui has introduced the "Board Benefit Trust (BBT)" as its performance-linked and share-based compensation plan since FY2018, and its own shares remaining in the Trust is included as treasury shares. The number of treasury stocks at the end of the term and the average number of shares during the term is 330,500.

* The summary of financial results is not subject to audits.

*Explanation on the proper use of the forecasts and other noteworthy items

This report's performance forecasts are based on information available at present, and certain premises are thought to be reasonable. Accordingly, the results may change substantially due to various factors. For conditions from which the premises for the forecasts were derived and the other noteworthy items relating to the use of the forecasts, please

refer to "(3) Explanation on Consolidated Financial Forecasts" on page 6 of the Summary of 1st Quarter Report for the Fiscal Year 2021 (Appendix).

Consolidated

1. Qualitative information for the first quarter of the fiscal year ending March 31, 2022

1. Explanation on consolidated financial results

Nissui has adopted the "Accounting Standard for Revenue Recognition" (ASBJ Statement No.29, March 31, 2020), etc., from the first quarter of the current consolidated fiscal year and compared and analyzed the same period of the previous year been adopted the accounting standard.

During the first three months of the consolidated fiscal year under review, the Japanese economy witnessed the improvement in corporate earnings, mainly in the manufacturing industry, thanks to the various economic policies launched by the Japanese Government and increased export along with the recovering foreign economy. However, a new coronavirus (COVID-19) was re-spread, and the emergency declaration was re-issued due to the outbreak of the mutant virus. The outlook is still uncertain, and nobody can predict when the infection ends.

In terms of the global economy during the period subject to consolidated accounting from January to March, consumer spending and capital investment increased in the United States where the restriction on going out and other measures were gradually lifted in the background of the vaccine spread. On the other hand, the situation remained severe due to the prolonged restriction on activities, such as lockdowns and so on, because of the re-expansion of infections in European major countries.

The Company and its corporate group showed improvement in the marine products business. The aquaculture business in Japan and overseas and sales of marine products improved following the recovery of economic activity while the Japanese fishery and Alaskan pollock processing business struggled. In the food products business, food sales for household use stay healthy in Japan and foreign countries. At the same time, sales of food for food services show a favorable turn with the increase in the flow of people.

Under these circumstances, the consolidated financial results through the first quarter of the consolidated fiscal year under review were as follows: net sales were 165,407 million yen, up 13,455 million yen year-on-year; operating profit was 7,049 million yen, up 2,819 million yen year-on-year; ordinary profit was 7,495 million yen, up 2,565 million yen year-on-year; and the profit attributable to the owners of the parent company was 5,186 million yen, up 2,014 million yen year-on-year.

Among the spread of vaccinations and the expansion of mutant strains of COVID-19, it is difficult to see the end of the pandemic. Still, we will once again discuss our medium-to-long-term vision and strategies to realize our vision in the current fiscal year. In addition, we will make steady efforts to strengthen the constitution for the upcoming mid-to-long-term management plan.

Specifically, we will position it as "time to solidify the foundation for overcoming weak points, developing strengths, and regrowing" and rebuild our domestic aquaculture business and chilled business immediately. Also, we will expand and strengthen products, which are delicious and contributes to health that responds to the changes in lifestyles and needs, such as restrictions on going out and increasing work from home on a global scale.

As for our measures against COVID-19, we will continue to implement workstyles for employees to realize the 3Cs, namely avoiding "closed spaces," "crowded places," and "close-contact settings," by combining "working from home" and "web meetings," etc., to prevent the spread of infection. We are committed to continuing with measures to prevent infection, ensuring our business partner's and employees' safety, and thereby fulfilling our responsibilities to produce and supply food.

				(Unit: million yen)
	Net Sales	Operating Profit	Ordinary Profit	Profit attributable to
	owners of parent
1Q of FY2021	165,407	7,049	7,495	5,186
1Q of FY2020	151,952	4,229	4,930	3,172
Difference	13,455	2,819	2,565	2,014
Percentage difference (%)	108.9%	166.7%	152.0%	163.5%

Consolidated

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The summary by segment is as follows.

(Unit: million yen)

	Net Sales	Increase/Decrease	Y-on-Y	Operating Profit	Increase/Decrease	Y-on-Y
	(Y-on-Y)	(Y-on-Y)
Marine Products	63,508	1,719	102.8%	2,102	108	105.4%
Food Products	84,092	7,146	109.3%	5,150	2,051	166.2%
Fine Chemicals	7,857	2,499	146.7%	1,059	768	364.0%
General Distribution	3,957	(205)	95.1%	524	88	120.4%
Other (Note)	5,991	2,295	162.1%	123	(63)	65.9%
Common Costs	-	-	-%	(1,913)	(134)	107.5%
Total	165,407	13,455	108.9%	7,049	2,819	166.7%

(Note) "Other" refers to Engineering (planning, design, construction of plants and equipment) business and Ship Operation Business, etc.

(1) Marine Products Business

The Marine Products segment is engaged in the fishery, aquaculture, and seafood processing and trading businesses.

We recorded 63,508 million yen (up 1,719 million yen year-on-year) in the sales and operating profit of 2,102 million yen (up 108 million yen year-on-year) in the Marine Products Business.

Fishery Business:Both revenue and income decreased year-on-year. [Japan]

・Both revenue and income decreased as horse mackerel, skipjack, and buri yellowtail caught poor as a whole.

Aquaculture Business:Both revenue and income increased year-on-year. [Japan]

・Both revenue and income increased as the sales volume of buri yellowtail and coho salmon increased, and the sales price was steady. Also, there was the cost reduction effect in tuna farming, which struggled last year.

[South America]

・Both sales and profit increased thanks to the increasing sales volume of salmon/trout. Seafood Processing and Trading Business: Both revenue and income increased year-on-year. [Japan]

・Revenue and income increased as the unit price rose as the sales price of main species such as salmon/trout increased.

[ North America]

・Both revenue and income decreased as the production volume of surimi etc., declined due to the epidemic of COVID- 19 at pollock processing factories in Alaska, USA. In addition, there was an increase in cost for countermeasures for coronavirus.

[Europe]

・Sales and profit increased as the sales in a certain area where we saw an improvement in economic activity was healthy.

Consolidated

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(2) Food Products Business

The Food Products segment is engaged in the food processing and chilled foods businesses.

We recorded 84,092 million yen (up 7,146 million yen year-on-year) in sales and operating profit of 5,150 million yen (up 2,051 million yen year-on-year) in the Food Products Business.

Processed Foods Business:Both revenue and income increased year-on-year.

・Revenue and income increased as the food sales for household use and food service were steady both within and outside Japan.

Chilled Foods Business: Both revenue and income increased year-on-year.

・Income increased as the sales of chilled lunch boxes and rice balls for convenience stores improved. In addition, there was a cost reduction effect.

(3) Fine Chemicals Business

The Fine Chemicals segment is engaged in the manufacture and sale of pharmaceutical raw materials, functional raw materials (Note 1), functional foods (Note 2), diagnostic medicines, and test drug.

We recorded 7,857 million yen (up 2,499 million yen year-on-year) in sales and operating profit of 1,059 million yen (up 768 million yen year-on-year) in the Fine Chemicals Business.

[Pharmaceutical Raw Materials, Functional Raw Materials and Functional Foods]

• Sales and profit increased thanks to strong mail-order sales of functional foods. [Clinical Diagnostic and Test Drug]

・Revenue and income increased because of steady sales of PCR testing agents for the COVID-19 and culture media for overseas.

(4) General Distribution Business

The General Distribution segment is engaged in the cold storage, transportation, and customs clearing businesses.

We recorded 3,957 million yen (down 205 million yen year-on-year) in sales and operating profit of 524 million yen (up 88 million yen year-on-year) in the General Distribution Business.

• Revenue decreased as inventory in storage decreased while the amount of loading and unloading was steady. Income increased as there was a decrease in start-up cost for Osaka Maishima No.2, which started operating last April.
  (Note 1) EPA, DHA, and others are mainly used as ingredients of health supplements and infant formula
  (Note 2) Supplements such as EPA, DHA, and "i-mark S," food for specified health uses (FOSHU), for online business

Consolidated

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