Ship Healthcare : Summary of Financial Statements for Third Quarter of Fiscal Year Ending March 31, 2022 (Consolidated)

Summary of Financial Statements

for Third Quarter of Fiscal Year Ending March 31, 2022 [Japanese GAAP]

(Consolidated)

				February 8, 2022
Name of listed company:	SHIP HEALTHCARE HOLDINGS, INC.
		Shares listed on: Tokyo Stock Exchange
Code:		3360	URL	https://www.shiphd.co.jp/en/
Representative:	(Title) President	(Name) Futoshi Ohashi
Contact:	(Title) Executive Director	(Name) Hiroshi Yokoyama
				Tel.: [phone]
Scheduled date for filing quarterly report: February 10, 2022 Scheduled start date of dividend payments: -
Supplementary briefing materials on results:	None
Briefing on quarterly results:		None
			(All figures are rounded down to the nearest million yen.)

1. Consolidated financial results for the third quarter of the fiscal year ending March 31, 2022 (April 1 - December 31, 2021)

	(1) Consolidated operating results (cumulative)				(Percentages represent year-on-year changes.)
				Net sales			Operating profit		Ordinary profit	Profit attributable to
							owners of parent
				(Million yen)		%		(Million yen)	%		(Million yen)	%	(Million yen)	%
	Q3	FY ending March 2022		363,154		－	12,359	(14.6)		12,374	(16.8)	6,983	(20.9)
	Q3	FY ended March 2021		349,357		(2.4)	14,476	6.8		14,874	1.7	8,831	(0.6)
Note: Comprehensive income: Q3 FY ending March 2022: ¥ 5,653 million ((46.9) %)
			Q3 FY ended March 2021: ¥10,638 million ( 8.5 %)
				Net income per share		Diluted net income per
					share
						(Yen)			(Yen)
	Q3	FY ending March 2022				74.01			67.10
	Q3	FY ended March 2021				93.45			84.79

Note: 1 Accounting Standard for Revenue Recognition (ASBJ Statement No.29, March 31,2020) have been applied from the beginning of the first quarter of the current consolidated accounting period, and each numerical value for the third quarter of the fiscal year ending March 2022 is the value after applying the relevant accounting standards. Due to the above reason, quarterly YoY rate of change in net sales is not stated.

2 The company executed a two-for-one common stock split, effective on April 1, 2021. "Net income per share" and "Diluted net income per share" are calculated as if the relevant stock split was executed at the beginning of the previous consolidated fiscal year ended March 31, 2021.

1. Consolidated financial condition

	Total assets	Net assets	Equity capital ratio
	(Million yen)	(Million yen)	%
Q3 FY ending March 2022	320,655	116,911	35.4
FY ended March 2021	334,498	115,103	33.3

Reference: Equity: Q3 FY ending March 2022: ¥113,355 Million yen; FY ended March 2021: ¥111,440 Million yen

2. Dividends

				Annual dividends
		End Q1	End Q2	End Q3	Year-end	Total
		(Yen)	(Yen)	(Yen)	(Yen)	(Yen)
	FY ended March 2021	-	0.00	-	80.00	80.00
	FY ending March 2022	-	0.00	-
	FY ending March 2022				41.00	41.00
	(forecast)
Notes: Revisions made in most recently announced dividend forecasts: None

Note: The company executed a two-for-one common stock split, effective on April 1, 2021. Annual dividends for the year ended March 31, 2021 are actual amounts paid prior to the relevant stock split. Forecasted annual dividends for the year ending March 31, 2022 are the amount after the relevant stock split.

3. Forecast of consolidated financial results for fiscal year ending March 31, 2022 (April 1, 2021 - March 31, 2022)

(Percentages represent changes from previous year.)

	Net sales		Operating profit	Ordinary profit	Profit attributable to	Net income per
		owners of parent	share
	(Million yen)		%	(Million yen)	%	(Million yen)	%	(Million yen)	%	(Yen)
Full-year	530,000		－	22,500	3.2	22,500	3.4	12,500	1.8	132.48

Note: Revisions made in most recently announced forecasts of business performance: None

Note: 1 Accounting Standard for Revenue Recognition (ASBJ Statement No.29, March 31,2020) have been applied from the beginning of the first quarter of the current consolidated accounting period, and each numerical value for the third quarter of the fiscal year ending March 2022 is the value after applying the relevant accounting standards. Due to the above reason, quarterly YoY rate of change in net sales is not stated.

2 The company executed a two-for-one common stock split, effective on April 1, 2021. "Net income per share" and "Diluted net income per share" are calculated as if the relevant stock split was executed at the beginning of the previous consolidated fiscal year ended March 31, 2021.

Notes

(1)	Changes made in significant subsidiaries during consolidated cumulative quarter under review:	None
(2)	Special account processing applied in preparation of quarterly consolidated financial statements:	None
(3)	Changes made in accounting policies, accounting estimates, and/or restatements:
	(i)	Changes in accounting policies associated with changes in accounting standards, etc.:	Yes
	(ii)	Any changes in accounting policies other than those under (i) above:	None
	(iii) Changes in accounting estimates:	None
	(iv) Restatements:	None
(4)	Number of shares issued and outstanding (common shares)

1. Number of shares issued and outstanding at the end of the period (including treasury stock)
2. Number of treasury stock at the end of the period
3. Average number of shares during the period (quarterly cumulative total)

Q3 FY ending	101,669,400 shares	FY ended March	101,669,400 shares
March 2022	2021
Q3 FY ending	7,319,116 shares	FY ended March	7,319,054 shares
March 2022	2021
Q3 FY ending	94,350,312 shares	Q3 FY ended	94,506,546 shares
March 2022	March 2021

Note: The company executed a two-for-one common stock split, effective on April 1, 2021. "Number of shares issued and outstanding at the end of the period", "Number of treasury stock at the end of the period", and "Average number of shares during the period" are calculated as if the relevant stock split was executed at the beginning of the previous consolidated fiscal year ended March 31, 2021.

• This quarterly summary of financial results is not subject to quarterly review by a Certified Public Accountant or an audit firm.
• Information on appropriate use of financial forecasts and other special notes:
• • The forecasts of financial results and other forward-looking statements provided herein are based on information available to the Company and assumptions considered reasonable at the time this document was prepared. They are not guarantee that the Company will achieve such forecasts. Actual results may differ significantly from the forecasts for various reasons. For the assumptions on which financial forecasts are based, notes on using financial forecasts, and other information, please refer to "Information on consolidated financial forecasts and other forward- looking statements" on page 3 of the attached materials.

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements for Third Quarter of Fiscal Year Ending March 31, 2022

• Index of attached materials

1.	Qualitative information on quarterly results .....................................................................................................	2
	(1)	Description of business results ................................................................................................................	2
	(2)	Analysis of financial position ..................................................................................................................	3
	(3)	Information on consolidated financial forecasts and other forward-looking statements ..........................	3
2.	Quarterly consolidated financial statements and notes thereto .........................................................................	4
	(1)	Quarterly consolidated balance sheet.......................................................................................................	4

1. Quarterly consolidated statement of income and quarterly consolidated statement of

comprehensive income ............................................................................................................................	6
(3) Notes on quarterly consolidated financial statements ..............................................................................	8
(Notes on the going concern assumption)................................................................................................	8
(Notes on marked changes to shareholders' equity) .................................................................................	8
(Changes in accounting policy) ...............................................................................................................	8
(Segment information, etc.) .....................................................................................................................	9

1

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements for Third Quarter of Fiscal Year Ending March 31, 2022

1. Qualitative information on quarterly results

(1) Description of business results

The Japanese economy during Q3 FY ending March 2022, momentum for recovery of economic activities had increased as the declaration of emergency and pre-emergency measures, which had been applied intermittently mainly in major cities, were lifted at the end of September thanks to the increase of COVID-19 vaccination coverage. On the other hand, the future of the economy remains uncertain due to the emergence of new highly infectious variant of coronavirus, a shortage of raw materials such as semiconductor and crude oil, as well as disruption and break of the global supply chain.

Healthcare industry in which the Group operates, while the medical care system temporarily became overwhelmed than ever due to the fifth wave of the spread of COVID-19, the industry trend has recovered compared to the same period last year due to the rapid decrease in the number of newly infected people due to the increase of vaccination coverage. However, due to the emergence of new highly infectious variant of coronavirus, there is still a need to strengthen the healthcare provide system in preparation for the sixth wave of the rapid spread of COVID-19 in Japan.

Under such conditions, the Group's business performance declined due to more small-sized projects in Total Pack Produce business than in previous years, difficulties in procuring electronic components and plastic vinyl products for manufacturers that we had to temporarily postpone new contracts, and the impact of a reactionary decline in demand for infection control products in common with the Medical Supply business.

For Q3 FY ending March 2022, the various factors noted above resulted in net sales of 363,154 million yen (Cumulative consolidated period for the same quarter of the previous year was 349,357 million yen), operating profit of 12,359 million yen (down 14.6% YoY), ordinary profit of 12,374 million yen (down 16.8% YoY), and profit attributable to owners of the parent of 6,983 million yen (down 20.9% YoY).

Accounting Standard for Revenue Recognition (ASBJ Statement No.29, March 31,2020) have been applied from the beginning of the first quarter of the current fiscal year. Due to the application, the explanation regarding business results does not include the YoY comparison (%) concerning net sales since the accounting method is different from the consolidated cumulative period for the second quarter of the previous fiscal year. For details, please refer to "2. Quarterly consolidated financial statements and notes thereto (4) Notes on consolidated financial statements (Changes in accounting policy) and (Segment information, etc.)".

Business results by segment are summarized below.

The classification of the reportable segments has been changed from the first quarter consolidated accounting period, and the comparison and analysis of the current third quarter consolidated cumulative period are based on the new classification.

1. Total Pack Produce business
   In Total Pack Produce business, business performance declined due to more small-sized projects than in previous years, order adjustments due to difficulties in procuring electronic components, reactionary decline in demand for infection control products subject to COVID-19 control subsidies, and military coup, COVID-19 pandemic, and financial regulations on Myanmar subsidiary. Alternatively, we were newly commissioned to provide a variety of service businesses for countermeasures against COVID-19, including the development and operation of the Osaka Corona Large-Scale Medical and Medical Care Center.
   As a result, this segment recorded net sales of 55,864 million yen (Cumulative consolidated period for the same quarter of the previous year was 64,056 million yen) and segment profit (operating profit) of 4,049 million yen (down 33.4% YoY).
2. Medical Supply business
   In Medical Supply business, the business performance was declined due to the reactionary decline in demand for infection control products, despite the demand for medical materials recovered due to increase of the occupancy rate in medical institutions and the number of surgical cases compare to the same period last year. Also, an efficient management and operation system has been prepared with the start of full-scale operation of "Osaka Solution Center" which is the automated logistic center for medical consumables.
   As a result, this segment recorded net sales of 266,757 million yen (Cumulative consolidated period for the same quarter of the previous year was 246,656 million yen) and segment profit (operating profit) of 4,187 million yen (down 10.5% YoY).
3. Lifecare business
   In Lifecare business, business performance was firm due to the continued high occupancy rate, thanks to the use of our detailed information sharing system, which connects residents and their families via the Internet.
   As a result, this segment recorded net sales of 18,887 million yen (Cumulative consolidated period for the same quarter of the previous year was 18,476 million yen) and segment profit (operating profit) of 1,825 million yen (up 7.1% YoY).

2