NOK : Consolidated Financial Results for the Nine Months Ended December 31, 2022 (Japanese GAAP) （388 KB）

NOK CORPORATION and Consolidated Subsidiaries

Consolidated Financial Results for the Nine Months Ended December 31, 2022 (Japanese GAAP)

Date: February 3, 2023

Company name:

NOK Corporation

Listed on the Tokyo Stock Exchange

Securities code:

7240

URL https://www.nok.co.jp

Representative:

Masao Tsuru

Telephone: [phone]

Representative Director and President

Inquiries:

Kiyoshi Igarashi

Manager

IR Department

Quarterly securities report filing date (as planned): February 10, 2023

Dividend payable date (as planned): -

Supplemental material of quarterly results: None

Convening briefing of quarterly results: None

(Fractions are rounded down to the nearest million yen.)

1. Consolidated Financial Results for the First Nine Months of Fiscal 2022 (April 1, 2022 to December 31, 2022)

(1) Consolidated operating results

(Percentage figures represent year-on-year changes)

Net sales

Operating income

Ordinary income

Profit attributable to

owners of parent

million yen

%

million yen

%

million yen

%

million yen

%

9 mos. ended Dec. 31, 2022

540,215

6.7

15,078

(35.1)

23,903

(30.0)

13,529

(28.3)

9 mos. ended Dec. 31, 2021

506,252

16.2

23,240

348.6

34,132

388.4

18,879

-

Note: Comprehensive income: 17,759 million yen (47.2) % (as of December 31, 2022); 33,637 million yen, 20.2% (as of December 31, 2021)

	Net income per share	Diluted net income per share
	yen		yen
9 mos. ended Dec. 31, 2022	78.61		-
9 mos. ended Dec. 31, 2021	109.15		-
(2) Consolidated financial position
	Total assets	Net assets	Capital adequacy ratio
	million yen	million yen	%
Dec. 31, 2022	854,610	557,349	59.0
March 31, 2022	857,324	554,355	58.6

Reference: Owner's equity: 504,091 million yen (as of December 31, 2022); 502,262 million yen (as of March 31, 2022)

2. Dividends

							Dividend per share
			First quarter		Second quarter		Third quarter	Fiscal year end		Total
				yen	yen		yen		yen			yen
	FY 2021			-	25.00		-		35.00			60.00
	FY 2022			-	25.00		-
	FY 2022 (Forecast)								25.00			50.00
	Note: Correction of	dividend forecast from the most recent dividend forecast: None
3. Consolidated Forecast for Fiscal 2022 (April 1, 2022 to March 31, 2023)	(Percentage figures represent year-on-year changes)
			Net sales		Operating income	Ordinary income	Profit attributable to	Net income per share
				owners of parent
		million yen	%	million yen	%	million yen	%	million yen	%		yen
	Full year	717,400	5.1	13,700 (56.3)	23,200 (49.7)	10,500 (59.4)	61.01

Note: Correction of financial forecast from the most recent financial forecast: Yes

*Notes

1. Material changes in subsidiaries during this period (Changes in scope of consolidations resulting from change in subsidiaries): None
2. Applying of specific accounting of the consolidated quarterly financial statements: Yes

(Note) For details, please refer to "2. Consolidated Quarterly Financial Statements and Principal Notes (3) Notes Concerning Consolidated Quarterly Financial Statements (Accounting Treatments Specific to the Preparation of Consolidated Quarterly Financial Statements)" on page 7 of the attached document.

(3) Changes in accounting policies and accounting estimates, retrospective restatement

(1)	Changes in accounting policies based on revisions	: Yes
	of accounting standard
(2)	Changes in accounting policies other than ones	: None
	based on revisions of accounting standard
(3)	Changes in accounting estimates	: None
(4)	Retrospective restatement	: None

1. Number of issued and outstanding shares (common stock)
2. 1. Number of issued and outstanding shares at the end of each period (including treasury stock)
   2. Number of shares of treasury stock at the end of each period
   3. Average number of shares (year to date)

9	mos. ended	173,138,537	Dec. 31, 2021	173,138,537
Dec. 31, 2022	shares		shares
9	mos. ended	1,987,136 shares	Dec. 31, 2021	169,991 shares
Dec. 31, 2022
9	mos. ended	172,103,200	9 mos. ended Dec.	172,968,572
Dec. 31, 2022	shares	31, 2021	shares

*This summary of quarterly financial results is not subject to quarterly review procedures of a certified public accountant or audit firm.

* Proper use of the projections for financial results, and other important matters:

Forward-looking statements such as projections of future financial results and other descriptions concerning our future business included in this document are based on currently available information and certain assumptions that we consider to be reasonable, and no representation or warranty is given with regard to the realization of such projections, etc. Actual financial results may differ significantly due to various factors. For assumptions, etc., used as the basis for the projections for financial results, please see "Explanation of Consolidated Financial Projections and Other Prospects for the Future" on page 2 of the attached document.

NOK Corporation (7240): Summary of Consolidated Financial Results for the Nine Months Ended December 31, 2022

○Table of Contents of Attached Document
1. Qualitative Information on the Consolidated Operating Results for the Nine Months Ended December 31, 2022	2
(1)	Explanation of Financial Position and Operating Results	2
(2)	Explanation of Consolidated Financial Projections and Other Prospects for the Future	2
2. Consolidated Quarterly Financial Statements and Principal Notes	3
(1)	Consolidated Quarterly Balance Sheet	3
(2)	Consolidated Quarterly Income Statement and Consolidated Quarterly Comprehensive Income Statement	5
	Consolidated Quarterly Income Statement
	Nine Months Ended December 31, 2022	5
	Consolidated Quarterly Comprehensive Income Statement
	Nine Months Ended December 31, 2022	6
(3)	Notes Concerning Consolidated Quarterly Financial Statements	7
	(Notes Concerning the Going Concern Assumption)	7
	(Notes on Significant Changes in the Amount of Shareholders' Equity)	7
	(Accounting Treatments Specific to the Preparation of Consolidated Quarterly Financial Statements)	7
	(Change in Accounting Policy)	7
	(Segment Information)	8

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NOK Corporation (7240): Summary of Consolidated Financial Results for the Nine Months Ended December 31, 2022

1. Qualitative Information on the Consolidated Operating Results for the Nine Months Ended December 31, 2022

(1) Explanation of Financial Position and Operating Results

During the first nine months of the current consolidated fiscal year, the Japanese economy saws signs of gradual recovery, despite a temporary contraction in economic activity due to the impact of lockdown in China as a result of the spread of COVID-19 and the supply shortage of semiconductors and other components. On the other hand, the prolonged conflict in Russia and Ukraine and other factors have caused raw material and energy prices to soar, and the monetary policies of various countries against accelerating inflation, as well as China's policy shift against COVID-19, have made it difficult to shake off the uncertainty in foreign exchange rate movements and the future of the economy uncertain.

In the automobile industry, while production declined both in Japan and overseas owning to the effect of lockdown in China and the shortage of semiconductors and other components, it has been on a moderate recovery trend since the beginning of the second quarter of the current consolidated fiscal year. However, the outlook remains uncertain due to the ongoing impact of the shortage of semiconductors and other components.

In the electronics industry, demand for smartphones and hard disk drives declined, although the impact of shortages of semiconductors and other components has eased.

Under these circumstances, the operating results of the Group by business segment were as follows:

In the seal business, sales for automobile applications are currently on a recovery track, despite the negative effect of lockdown in China during the first quarter of the current consolidated fiscal year and the shortage of semiconductors and other components. In addition, sales to automobile applications increased due to the significant impact of foreign exchange rate movements as well as passing on soaring raw material prices to selling prices.

Looking at demand for general industrial machinery applications, demand from manufacturers of machine tools in Japan remained firm while demand from manufacturers of construction machinery was negatively affected by lockdown in China. Meanwhile, sales to manufacturers of general industrial machinery increased as a result of foreign exchange rate movements as well as passing on soaring raw material prices to selling prices.

As a result, net sales stood at 261,371 million yen (up 4.9% year on year). Operating income amounted to 15,058 million yen (down 42.7% year on year) mainly due to soaring raw material and energy prices that exceeded price pass-through.

In the electronic product business, demand for automobile applications increased despite the negative impact of lockdown in China and the shortage of semiconductors and other components. Demand for high- end smartphones decreased due to the impact of new lockdowns in some Chinese cities. And demand for HDDs also decreased. Sales rose on the back of the significant positive effect of foreign exchange rate movements on the overall business.

As a result, net sales stood at 256,466 million yen (up 7.8% year on year). Operating loss decreased to 1,188 million yen (compared to an operating loss of 3,928 million yen in the same period of the previous fiscal year) due to the decreased personnel costs and the impact of foreign exchange rate.

In other businesses, sales increased due to strong demand for special lubricants, a recovery in demand for products for office equipment, and the positive effect of foreign exchange rate movements.

As a result, net sales totaled 22,377 million yen (up 16.2% year on year). Operating income came to 1,202 million yen (up 32.0% year on year).

In summary, the Group posted the following results for the first nine months of the current consolidated fiscal year: Net sales totaled 540,215 million yen (up 6.7% year on year); operating income was 15,078 million yen (down 35.1% year on year); ordinary income ended at 23,903 million yen (down 30.0% year on year), resulting in 13,529 million yen in profit attributable to owners of parent (down 28.3% year on year).

Total assets as of December 31, 2022 stood at 854,610 million yen, a decrease of 2,713 million yen compared with March 2022. This was mainly attributable to decreases in cash, deposits and market value of shares held by the Company, despite an increase in inventories.

Total liabilities as of December 31, 2022 amounted to 297,261 million yen, a decrease of 5,707 million yen compared with March 31, 2022. This was mainly due to decreases in accounts payable-trade and income taxes payable, despite increases in short- term loans payable and long-term loans payable.

Net assets totaled 557,349 million yen, an increase of 2,994 million yen compared with March 31, 2022. Consequently, the ratio of shareholders' equity to total assets stood at 59.0%. This mainly reflected an increase in retained earnings as a result of the recognition of profit attributable to owners of parent for the period, and an increase in foreign currency translation adjustment due to exchange rate fluctuations, despite the payment of dividends and decrease in valuation difference on available-for-sale securities.

(2) Explanation of Consolidated Financial Projections and Other Prospects for the Future

As a result of a review of the consolidated financial projections for the nine months ended December 31, 2022, our projection for net sales, operating income, ordinary income and profit attributable to owners of parent have been revised downward from the previously announced projections.

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NOK Corporation (7240): Summary of Consolidated Financial Results for the Nine Months Ended December 31, 2022

2. Consolidated Quarterly Financial Statements and Principal Notes

(1) Consolidated Quarterly Balance Sheet		(million yen)
		FY 2021	3Q FY 2022
		(as of March 31, 2022)	(as of December 31, 2022)
Assets
Current assets
Cash and deposits	113,085	97,283
Notes and accounts receivable-trade	151,015	149,621
Electronically recorded monetary claims	18,489	22,713
Inventories	111,261	126,073
Other	13,323	14,686
Allowance for doubtful accounts	(132)	(143)
Total current assets	407,043	410,234
Noncurrent assets
Property, plant and equipment	88,204	89,990
Buildings and structures, net
Machinery, equipment and vehicles, net	102,894	107,944
Other, net	58,103	51,998
Total property, plant and equipment	249,203	249,933
Intangible assets	3,971	4,019
Investments and other assets
Investment securities	163,644	151,960
Net defined benefit asset	1,869	2,257
Other	31,733	36,342
Allowance for doubtful accounts	(142)	(137)
Total investments and other assets	197,105	190,422
Total noncurrent assets	450,280	444,376
Total assets		857,324	854,610

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