Sohgo Security Services : Consolidated Financial Results for the First Quarter Ended June 30, 2021

Consolidated Financial Results for the First Quarter Ended June 30, 2021

Prepared in Conformity with Accounting Principles Generally Accepted in Japan (Japanese GAAP)

English Translation of the Original Japanese-Language Report

SOHGO SECURITY SERVICES CO., LTD.	(Code No.2331, TSE 1st Sec.)
URL https://www.alsok.co.jp/en/ir/index.html
Representative:	Yukiyasu Aoyama, President and Representative Director
Financial and accounting:	Koji Kishimoto, Director and Senior Executive Officer	(Phone: [phone])

1. Summary of the consolidated financial results for the first quarter ended June 30, 2021 (April 1, 2021 - June 30, 2021)

(1) Consolidated operating results				(Figures rounded down to the nearest million)
	Net sales		Operating income	Ordinary income	Profit attributable to
		owners of parent
	Millions of yen		%	Millions of yen	%	Millions of yen	%	Millions of yen	%
Three months ended
June 30, 2021	117,012		6.2	9,759	32.3	10,037	31.0	6,098	35.4
June 30, 2020	110,188		0.7	7,378	2.7	7,664	(0.7)	4,503	(1.0)

Note 1: Percentage shown in net sales, operating income, ordinary income, and profit attributable to owners of parent above represent the changes from the previous fiscal year.

Note 2:

Comprehensive income Three months ended June 30, 2021

¥ 6,372 million

4.9%

Three months ended June 30, 2020

¥ 6,071 million

31.9%

Net income per share

Diluted net income per share

Three months ended

Yen

Yen

June 30, 2021

60.24

-

June 30, 2020

44.48

-

(2) Consolidated financial conditions

Total assets

Net assets

Equity ratio

Net assets per share

Millions of yen

Millions of yen

%

Yen

Three months ended

470,528

306,515

59.5

2,763.38

June 30, 2021

Fiscal year ended

481,465

304,427

57.6

2,741.27

March 31, 2021

Reference:

Equity capital

Three months ended June 30, 2021

¥ 279,750 million

Year ended March 31, 2021

¥ 277,512 million

2. Dividend

Dividends per share

End of 1Q

End of 2Q

End of 3Q

Year-end

Annual

Yen

Yen

Yen

Yen

Yen

Fiscal year ended

March 31, 2021

-

35.00

-

37.00

72.00

March 31, 2022

-

Fiscal year ending

38.00

-

38.00

76.00

March 31, 2022(Forecast)

Note:

Revisions to the dividend forecast in this quarter: No

3. Forecasts for the consolidated financial results for the fiscal year ending March 31, 2022 (April 1, 2021 - March 31, 2022) (Figures rounded down to the nearest million)

		Net sales		Operating income	Ordinary income	Profit attributable to	Net income per share
			owners of parent
		Millions of yen	%	Millions of yen	%	Millions of yen	%	Millions of yen	%	Yen
Interim		249,000	10.2	19,100	20.6	19,800	20.2	12,500	25.5	123.48
Annual		500,500	6.5	42,100	13.2	43,500	10.9	27,500	9.9	271.65
Note :	Revisions to the forecast of financial results in this quarter: No

4. Others

1. Changes in consolidated subsidiaries (Changes in scope of consolidation) : No

Added:

-

Removed:

-

1. Application of accounting which is simplified or exceptional for quarterly consolidated financial statements: Yes
2. Changes in accounting policies, changes in accounting estimates, and restatement

a Changes arising from revision of accounting standards	: Yes
b Changes arising from other factors	: No
c Changes arising from accounting estimate	: No
d Restatement	: No

(4) Number of shares outstanding (Ordinary shares)

a Number of shares issued	Three months ended	102,040,042 shares	Year ended	102,040,042 shares
(including treasury stock)	June 30, 2021		March 31, 2021
b Number of shares of treasury stock	Three months ended	805,083 shares	Year ended	805,021 shares
	June 30, 2021	March 31, 2021
c Average number of ordinary shares	Three months ended	101,234,989 shares	Three months ended	101,235,176 shares
throughout the fiscal year	June 30, 2021		June 30, 2020

• This summary of financial results is exempt from quarterly review procedures.
• Explanation for Appropriate Use of Forecasts and Other Notes

The forward-looking statements such as operational forecasts contained in this summary of financial results are based on the information currently available to the Company and certain assumptions which are regarded as legitimate, and the Company does not promise the achievement of these results. Actual results may differ significantly from these forecasts due to various factors.

Consolidated Balance Sheets				(Millions of yen)
				As of March 31, 2021	As of June 30, 2021
	Assets
	Current assets
	Cash and deposits	60,833	52,913
	Cash for Transportation Security Services	82,819	77,273
	Notes and accounts receivable-trade	54,283	-
	Notes and accounts receivable - trade,	and	49,208
	contract assets	-
	Securities	598	491
	Raw materials and supplies	7,551	7,257
	Costs on uncompleted construction contracts	348	315
	Advances paid	5,670	6,349
	Other	15,691	24,415
	Allowance for doubtful accounts	(180)	(194)
	Total current assets
	227,617	218,029
	Noncurrent assets
	Property, plant and equipment	103,383	102,699
	Intangible assets
	Goodwill	29,678	29,092
	Other	13,569	13,347
	Total intangible assets
	43,247	42,440
	Investments and other assets
	Investment securities	55,639	54,491
	Other	52,025	53,299
	Allowance for doubtful accounts	(447)	(432)
	Total investments and other assets
	107,217	107,358
	Total noncurrent assets
	253,847	252,498
	Total assets
	481,465	470,528
Liabilities
	Current liabilities
	Notes and accounts payable-trade	24,084	19,078
	Short-term loans payable	23,880	16,877
	Income taxes payable	6,585	1,982
	Provision	2,516	1,255
	Other	46,726	52,365
	Total current liabilities
	103,793	91,560
	Noncurrent liabilities
	Long-term loans payable	4,528	3,959
	Retirement benefit liability	26,974	27,301
	Provisions	1,730	1,477
	Asset retirement obligations	480	485
	Other	39,529	39,228
	Total noncurrent liabilities
	73,243	72,452
	Total liabilities
	177,037	164,013

Consolidated Balance Sheets		(Millions of yen)
			As of March 31, 2021	As of June 30, 2021
	Net assets
	Shareholders' equity
	Capital stock	18,675	18,675
	Capital surplus	34,026	34,026
	Retained earnings	220,464	222,809
	Treasury stock	(1,071)	(1,071)
	Total shareholders' equity
	272,094	274,439
	Accumulated other comprehensive income
	Valuation difference on	7,026	6,793
	available-for-sale securities
	Revaluation reserve for land	(3,494)	(3,488)
	Foreign currency translation adjustment	(29)	45
	Remeasurements of defined benefit plans	1,915	1,960
	Total accumulated other comprehensive income
	5,417	5,311
	Minority interests
	26,915	26,765
	Total net assets
	304,427	306,515
	Total liabilities and net assets
	481,465	470,528

Consolidated Statements of Income		(Millions of yen)
			Three months ended	Three months ended
			June 30, 2020	June 30, 2021
	Net sales	110,188	117,012
	Cost of sales	82,531	87,383
	Gross profit
	27,656	29,629
	Selling, general and administrative expenses
	20,278	19,869
	Operating income
	7,378	9,759
	Non-operating income
	Interest income	42	45
	Dividends income	193	184
	Share of profit of entities accounted for using equity	58	101
	method
	Gain on sales of investment securities	1	0
	Dividend income of insurance	202	218
	Penalty income	247	113
	Other	358	263
	Total non-operating income
	1,105	927
	Non-operating expenses
	Interest expenses	489	490
	Financing expenses	59	67
	Other	270	91
	Total non-operating expenses
	819	649
	Ordinary income
	7,664	10,037
	Extraordinary income
	Gain on investment securities	-	7
	Gain on sales of non-current assets	-	65
	Total extraordinary income
	-	72
	Extraordinary loss
	Loss on sale of investment securities	-	0
	Loss on valuation of investment securities	16	67
	Total extraordinary losses
	16	68
	Income before income taxes
	7,648	10,042
	Income taxes
	2,775	3,572
	Net Income
	4,872	6,469
	Profit attributable to non-controlling interests
	368	371
	Profit attributable to owners of parent
	4,503	6,098