Organo : Consolidated Financial Results for the First Three Months of the Fiscal Year Ending March 31, 2024 153KB

DISCLAIMER: This translation may be used for reference purposes only. This English version is not an official translation of the original Japanese document. In cases where any differences occur between the English version and the original Japanese version, the Japanese version shall prevail. This translation is subject to change without notice.

Consolidated Financial Results for the First Three Months of

the Fiscal Year Ending March 31, 2024

	August 1, 2023
Company name:	ORGANO CORPORATION
Listing:	Tokyo Stock Exchange
Securities code:	6368
URL:	https://www.organo.co.jp/english/
Representative:	Masayuki Yamada, Representative Director and President
Inquiries:	Shigeru Sonobe, General Manager of Accounting Dept., Corporate Management and
	Planning
TEL:	[phone]

Scheduled date to file quarterly securities report:	August 8, 2023
Scheduled date to commence dividend payments:	-
Preparation of supplementary material on quarterly financial results: None
Holding of quarterly financial results presentation meeting:	None

(Millions of yen with fractional amounts discarded, unless otherwise noted)

1. Consolidated financial results for the first three months of the fiscal year ending March 31, 2024 (from April 1, 2023 to June 30, 2023)

(1) Consolidated operating results (cumulative)		(Percentages indicate year-on-year changes.)
			Net sales	Operating profit	Ordinary profit		Profit attributable to
				owners of parent
	Three months ended	Millions of yen	%	Millions of yen		%	Millions of yen	%		Millions of yen	%
	June 30, 2023	29,612	6.4	2,861		28.9	3,103	17.9		1,597	6.8
	June 30, 2022	27,835	24.8	2,219		65.8	2,633	61.5		1,495	82.7
	Note:	Comprehensive	income: Three	months	ended June 30,	2023	¥2,019 million	[10.3%]
			Three months ended June 30, 2022	¥1,831 million [47.4%]
			Basic earnings	Diluted earnings
			per share	per share
	Three months ended		Yen			Yen
	June 30, 2023		34.81			-
	June 30, 2022		32.64			-

The Company conducted a 4-for-1 common share split effective as of October 1, 2022. Basic earnings per share are calculated on the assumption that said share split was conducted at the beginning of the previous fiscal year.

(2) Consolidated financial position

			Total assets		Net assets	Equity-to-asset ratio
	As of			Millions of yen		Millions of yen	%
	June 30, 2023			160,656		86,871	53.9
	March 31, 2023			164,854		86,371	52.3
	(Reference) Equity:	As of June 30, 2023	¥86,657 million	As of March 31, 2023	¥86,170 million

2. Cash dividends

				Annual dividends per share
			First quarter-end	Second quarter-end	Third quarter-end	Fiscal year-end	Total
			Yen	Yen	Yen	Yen	Yen
	Fiscal year ended	-	116.00	-	33.00	-
	March 31, 2023
	Fiscal year ending	-
	March 31, 2024
	Fiscal year ending		33.00	-	33.00	66.00
	March 31, 2024
	(Forecast)
	Note:	Revisions to the forecast of cash	dividends most recently	announced: None

The Company conducted a 4-for-1 common share split effective as of October 1, 2022. The second quarter-end dividend per share for the fiscal year ended March 31, 2023 was stated before taking into account the effect of this share split, and the total annual dividend for the year was stated as "-." The annual dividend per share for the fiscal year ended March 31, 2023 that has been calculated based on post-share split figures is ¥62.

3. Consolidated earnings forecasts for the fiscal year ending March 31, 2024 (from April 1, 2023 to March 31, 2024)

(Percentages indicate year-on-year changes.)

			Net sales		Operating profit	Ordinary profit	Profit attributable to	Basic
				earnings
				owners of parent
										per share
			Millions		%	Millions	%	Millions	%	Millions	%	Yen
			of yen		of yen	of yen	of yen
	Six months ending	70,000		12.7	6,600	1.4	6,600	(11.4)	4,600	(8.5)	100.24
	September 30, 2023
	Fiscal year ending	150,000		13.3	16,000	5.2	16,000	(0.1)	11,200	(4.5)	244.07
	March 31, 2024
	Note:	Revisions to the earnings forecasts most recently announced: None

* Notes

1. Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in the change in scope of consolidation): None
2. Application of specific accounting for preparing the quarterly consolidated financial statements: Yes

Note:	For more details, please refer to "Application of special accounting for preparing the quarterly consolidated
	financial statements" on page 8 of the attached material.

1. Changes in accounting policies, changes in accounting estimates, and restatement
2. 1. Changes in accounting policies due to revisions to accounting standards and other regulations: None
   2. Changes in accounting policies due to other reasons: None
   3. Changes in accounting estimates: None
   4. Restatement: None
3. Number of issued shares (common shares)
4. 1. Total number of issued shares at the end of the period (including treasury shares)

As of June 30, 2023

As of March 31, 2023

46,359,700 shares

46,359,700 shares

b. Number of treasury shares at the end of the period

As of June 30, 2023

As of March 31, 2023

470,999 shares

470,795 shares

1. Average number of shares outstanding during the period (cumulative from the beginning of the fiscal year)

For the three months ended June 30, 2023

For the three months ended June 30, 2022

45,888,815 shares

45,818,204 shares

Notes:

1. The Company conducted a 4-for-1 common share split effective as of October 1, 2022. Average number of shares outstanding during the period is calculated on the assumption that said share split was conducted at the beginning of the previous fiscal year.
2. The Company has introduced an Officer Share Delivery Trust, and shares of the Company held by the Trust have been included in treasury shares excluded from the calculation of the number of treasury shares at the end of the period and the average number of shares outstanding during the period (cumulative from the beginning of the fiscal year).

* Quarterly financial results reports are exempt from quarterly review conducted by certified public accountants or an audit corporation.

* Proper use of earnings forecasts, and other special matters (Caution regarding forward-looking statements and others)

The forward-looking statements, including earnings forecasts, contained in these materials are based on information currently available to the Company and on certain assumptions deemed to be reasonable. Consequently, any statements herein do not constitute assurances regarding actual results by the Company. Actual business and other results may differ substantially due to various factors. Please refer to "(3) Explanation regarding consolidated earnings forecasts and other forward-looking statements" in "1. Qualitative information regarding financial results for the first three months" on page 3 of the attached material for the suppositions that form the assumptions for earnings forecasts and cautions concerning the use thereof.

Attached Material
	Index
1. Qualitative information regarding financial results for the first three months	2
(1)	Explanation regarding operating results	2
(2)	Explanation regarding financial position	3
(3)	Explanation regarding consolidated earnings forecasts and other forward-looking statements 3
2. Quarterly consolidated financial statements and significant notes thereto	4
(1)	Consolidated balance sheet	4
(2)	Consolidated statement of income and consolidated statement of comprehensive income	6
	Consolidated statement of income (cumulative)	6
	Consolidated statement of comprehensive income (cumulative)	7
(3)	Notes to quarterly consolidated financial statements	8
	Notes on premise of going concern	8
	Notes on substantial changes in the amount of shareholders' equity	8
	Application of special accounting for preparing the quarterly consolidated financial statements
	..............................................................................................................................................................	8
	Segment information, etc	9

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1. Qualitative information regarding financial results for the first three months

1. Explanation regarding operating results
   During the three months ended June 30, 2023 (April 1, 2023 to June 30, 2023), the global economy faced continued concerns about downward economic pressures, including a slowdown in the Chinese economy mainly due to a sluggish real estate market, and prolonged monetary tightening in the United States, Europe, and other countries in response to high inflation.
   In the electronics industry, the Company's main market, the market environment remained challenging as demand for memory and other semiconductors deteriorated against a backdrop of sluggish smartphone and PC sales, and capital investment and factory utilization rates declined. On the other hand, the general industry field, the social infrastructure field, such as electric power/water supply and sewage, and the Performance Products Business Unit remained strong.
   Under these conditions, the Organo Group proceeded to draw in orders and make deliveries for largescale projects in Japan and overseas, while establishing engineering solutions frameworks and strengthening supply chains, etc. to increase our production and delivery capacity and improve the efficiency thereof. We also engaged in initiatives to enhance R&D aimed at the creation of the next-generation technology and new businesses, and worked on initiatives for sustainability and strengthened our governance structure.
   As a result, in the Group's financial results for the three months ended June 30, 2023, orders received decreased by 35.3% year on year to ¥33,598 million, net sales increased by 6.4% to ¥29,612 million, operating profit increased by 28.9% to ¥2,861 million, ordinary profit increased by 17.9% to ¥3,103 million, profit attributable to owners of parent increased by 6.8% to ¥1,597 million, and our carry-over balance for order backlog as of June 30, 2023 was up 8.6% to ¥122,725 million.
   Results by segment are as follows.
   [Water Treatment Engineering Business Unit]
   ■Orders received
   Orders received decreased 40.2% year on year to ¥27,978 million. The electronics field, which is our main market, saw a significant decrease in orders received as a result of delays in investment decisions for large-scale projects against a backdrop of factors including deteriorating conditions in the semiconductor market, and also due to a rebound from the orders we received in the same period of the previous fiscal year for large-scale projects in countries including Japan, China, and Malaysia. On the other hand, the general industry field and the social infrastructure field, such as electric power/water supply and sewage, remained strong mainly in Japan, and so did the Plant Division and the Service Solutions Division.
   ■Net sales
   Net sales increased 5.5% year on year to ¥24,136 million. In the electronics field, we saw mostly steady progress in the construction of carried-over order backlogs from the previous year despite the impact of delays in part of overseas projects. We also saw strong performance in the Service Solutions Division mainly due to commencement of the large-scalefacility-owned service operations in Japan. The general industry field and the social infrastructure field, such as electric power/water supply and sewage, remained strong mainly in Japan, and so did the Plant Division and the Service Solutions Division.
   ■Operating profit
   Operating profit increased 36.9% year on year to ¥2,298 million. In addition to the effects of greater revenue resulting from higher sales, the improvement in profitability in some projects and the expansion of relatively profitable Service Solutions Division led to an improvement in gross profit margin, which more than offset rises in expenses, such as personnel expenses and research and development expenses. As a result, operating profit climbed.
2. • 2 -