Furukawa Battery : Financial Results for the Three-month Period Ended June 30, 2021

Translation

Member of Financial Accounting Standards Foundation (FASF)

August 5, 2021

Consolidated Financial Results

for the Three-month Period Ended June 30, 2021 [Japan GAAP]

Name of Company:	The Furukawa Battery Co., Ltd.
Stock Code:	6937
Stock Exchange Listing:	Tokyo Stock Exchange, First Section
URL:	https://www.furukawadenchi.co.jp
Representative
Title:	President & CEO
Name:	Shinichi Ono
Contact Person
Title:	Corporate Officer, General Manager of Finance &
	Accounting Department
Name:	Susumu Meida
Tel:	[phone]
Scheduled date for filing of quarterly securities report:	August 6, 2021
Scheduled date for commencement of dividend payment:	-
Supplementary documents for quarterly financial results:	None
Quarterly financial results briefing:	None
	(Yen in millions, rounded down)

1. Consolidated financial results for the three months ended June 30, 2021 (April 1, 2021 - June 30, 2021)

(1) Consolidated operating results						(Percentage figures 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	%
Three months ended June 30, 2021	13,035		5.9	259	(8.1)		329	(6.9)	355	26.4
Three months ended June 30, 2020	12,314		(11.6)	282	-		353	-	281	744.0

Note: Comprehensive income
Three months ended June 30, 2021:	851 million yen [yoy - %]
Three months ended June 30, 2020:	(440) million yen [yoy - %]
	Earnings per share	Earnings per share
	(basic)			(diluted)
		Yen			Yen
Three months ended June 30, 2021	10.84				-
Three months ended June 30, 2020	8.58				-
(2) Consolidated financial position
	Total assets			Net assets		Equity ratio
		Million yen			Million yen			%
As of June 30, 2021	57,467			31,422			52.5
As of March 31, 2021	57,686			31,388			52.2
Reference: Equity
As of June 30, 2021:	30,141 million yen
As of March 31, 2021:	30,109 million yen
2. Dividends
					Annual dividends per share
		End of Q1		End of Q2		End of Q3	End of Q4	Total
		Yen		Yen			Yen		Yen	Yen
Fiscal year ended March 31, 2021		-			-			-	22.00	22.00
Fiscal year ending March 31, 2022		-
Fiscal year ending March 31, 2022 (forecast)				-			-	22.00	22.00
Note: Revisions to the forecasts of dividends most recently announced: None

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

(Percentage figures represent year-on-year changes)

	Net sales		Operating profit	Ordinary profit	Profit attributable to	Earnings
		owners of parent	per share
	Million		%	Million	%	Million	%	Million	%	Yen
	yen		yen	yen	yen
Fiscal year ending	62,500		4.2	4,000	(9.0)	4,000	(10.7)	3,450	(4.6)	105.25
March 31, 2022
Note: Revisions to the consolidated earnings forecasts most recently announced: None

Notes:

(1) Changes in significant subsidiaries during the three-month period ended June 30, 2021 (Changes in specific subsidiaries accompanied by changes in the scope of consolidation): Newly included: None Excluded: None

1. Use of accounting methods that are specific to the preparation of the quarterly consolidated financial statements: Yes Note: For details, please refer to "2. Consolidated Financial Statements and Related Notes (3) Notes on Consolidated Financial Statements (Application of Special Accounting for Preparing Consolidated Financial Statements)" on page 8 of Attachment.
2. Changes in accounting policies, changes in accounting estimates, and retrospective restatements:
3. 1. Changes in accounting policies accompanying revisions in accounting standards: Yes
   2. Changes other than in (a): None
   3. Changes in accounting estimates: None
   4. Retrospective restatements: None

Note: For details, please refer to "2. Consolidated Financial Statements and Related Notes (3) Notes on Consolidated Financial Statements (Changes in Accounting Policies)" on page 8 of Attachment.

1. Number of shares outstanding (common stock)
2. 1. Shares outstanding (including treasury shares)

As of June 30, 2021: 32,800,000 shares	As of March 31, 2021: 32,800,000 shares
(b) Treasury shares
As of June 30, 2021: 22,086 shares	As of March 31, 2021: 22,086 shares
(c) Average number of shares outstanding during the period (cumulative)
Three months ended June 30, 2021:	Three months ended June 30, 2020:
32,777,914 shares	32,777,941 shares

• Quarterly financial results reports are not required to be subjected to quarterly reviews conducted by certified public accountants or an audit corporation.
• Appropriate use of performance forecasts and other special items: (Disclaimer on forward-looking statements, etc.)
  Forward-looking statements in these materials are based on information available to management at the time this report was prepared, and on assumptions that management believes are reasonable. Actual results may differ significantly from these statements for a number of reasons. Please refer to "1. Qualitative Information on Consolidated Financial Results for the Three- month Period (3) Explanation of Forecast for the Fiscal Year Ending March 31, 2022" on page 2 of Attachment for details on the assumptions used and other related matters concerning the forecast of consolidated financial results.

Index	of the Attachment
1. Qualitative Information on Consolidated Financial Results for the Three-month Period .........................................	2
(1)	Explanation of Operating Results ........................................................................................................................	2
(2)	Explanation of Financial Position ........................................................................................................................	2
(3)	Explanation of Forecast for the Fiscal Year Ending March 31, 2022...................................................................	2
2. Consolidated Financial Statements and Related Notes .............................................................................................	4
(1)	Consolidated Balance Sheets ...............................................................................................................................	4
(2)	Consolidated Statements of Income and Comprehensive Income .......................................................................	6
	(Consolidated Statements of Income (Cumulative)) ...........................................................................................	6
	(Consolidated Statements of Comprehensive Income (Cumulative)) .................................................................	7
(3)	Notes on Consolidated Financial Statements .......................................................................................................	8
	(Going Concern Assumptions) ............................................................................................................................	8
	(Material Changes in the Amount of Shareholders' Equity)................................................................................	8
	(Application of Special Accounting for Preparing Consolidated Financial Statements) .....................................	8
	(Changes in Accounting Policies) .......................................................................................................................	8
3. Other .......................................................................................................................................................................	10
(Trend in Quarterly Consolidated Results) ..............................................................................................................	10

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1. Qualitative Information on Consolidated Financial Results for the Three-month Period

1. Explanation of Operating Results

(Business Environment)

During the three-month period ended June 30, 2021, the global economy remained in a serious situation due to the impact of the global outbreak of the novel coronavirus disease (COVID-19).

Despite the situation remaining serious due to the impact of COVID-19 for the Japanese economy as well, it is expected to pick up due to the effects of various policy measures, etc.

(Operating Results)

The Group recorded net sales of 13,035 million yen for the three-month period ended June 30, 2021, an increase of 721 million yen year on year. Overseas sales were 4,913 million yen and accounted for 37.7% of total sales.

In terms of profit and loss, operating profit decreased by 22 million yen year on year to 259 million yen due to the impact of the rise in the price of lead, a major raw material. Ordinary profit decreased by 24 million yen year on year to 329 million yen due to a decrease in income such as dividend income, despite a decrease in expenses such as interest expenses.

Profit attributable to owners of parent came to 355 million yen, increasing 74 million yen year on year.

The "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020) and relevant revised ASBJ regulations have been applied from the beginning of the first quarter of the current fiscal year, and compared with the previous method, net sales for the first quarter of the current fiscal year decreased by 745 million yen, operating profit decreased by 46 million yen, and ordinary profit and profit before income taxes each decreased by 43 million yen. For details, please refer to "2. Consolidated Financial Statements and Related Notes (3) Notes to Consolidated Financial Statements (Changes in Accounting Policies)."

(2) Explanation of Financial Position

Total assets were 57,467 million yen as of June 30, 2021, which is 218 million yen less than at the end of the previous fiscal year. Current assets decreased by 599 million yen from the end of the previous fiscal year to 28,424 million yen, while non-current assets increased by 380 million yen from the end of the previous fiscal year to 29,043 million yen.

The main factors leading to the decrease in current assets were decreases in accounts receivable - trade, etc. There was a 158 million yen increase in property, plant and equipment to 23,282 million yen. The main factor

leading to the increase was foreign currency translation differences of non-current assets owned by overseas subsidiaries.

Investments and other assets increased by 147 million yen from the end of the previous fiscal year to 5,354 million yen.

Total liabilities as of June 30, 2021, decreased by 252 million yen from the end of the previous fiscal year to 26,044 million yen. Current liabilities increased by 93 million yen from the end of the previous fiscal year to 14,782 million yen, and non-current liabilities decreased by 346 million yen from the end of the previous fiscal year to 11,262 million yen.

Interest-bearing debt, which is the sum of short-term borrowings and long-term borrowings, decreased by 189 million yen from the end of the previous fiscal year to 5,889 million yen.

Equity as of June 30, 2021, increased by 32 million yen from the end of the previous fiscal year to 30,141 million yen, resulting in an increase in the equity ratio from 52.2% at the end of the previous fiscal year to 52.5%.

(3) Explanation of Forecast for the Fiscal Year Ending March 31, 2022

There is no change to the consolidated forecast that was announced on May 12, 2021. Regarding the spread of COVID-19 and the timing of the settlement of COVID-19, etc., no changes have been made to the assumptions (that this situation will continue in the fiscal year ending March 31, 2022 and certain limits will be set regarding economic

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activity as there is no uniform opinion regarding the spread of COVID-19, the timing of the settlement of COVID-19, etc.) announced on May 12, 2021.

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