Yukiguni Maitake : Consolidated Financial Results for the Three Months Ended June 30, 2022 (Under IFRS)

Note: This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between this translated document and the Japanese original, the original shall prevail.

August 4, 2022

Consolidated Financial Results for the

Three Months Ended June 30, 2022 (Under IFRS)

Company name:	YUKIGUNI MAITAKE CO., LTD.
Listing:	Tokyo Stock Exchange
Securities code:	1375
URL:	https://www.maitake.co.jp/
Representative:	Masafumi Yuzawa, President and CEO, Representative Director
Inquiries:	Takenori Sakurai, Senior Executive Officer (Chief Financial Officer)
Telephone:	[phone]

Scheduled date to file quarterly securities report:	August 5, 2022
Scheduled date of dividend payment commencement	-
Preparation of supplementary material on quarterly financial results: Yes
Holding of quarterly financial results briefing:	Yes

(Yen amounts are rounded down to millions, unless otherwise noted.)

1. Consolidated Financial Results for the First Three Months Ended June 30, 2022 (from April 1, 2022 to June 30, 2022)

(1) Consolidated Operating Results (Cumulative)		(Percentages indicate year-on-year changes.)
	Total income	Operating profit	Profit before tax	Profit
Three months ended	Millions of yen	%	Millions of yen	%	Millions of yen		%	Millions of yen		%
June 30, 2022	8,201	-8.2	-163	-	-258		-	-158		-
June 30, 2021	8,938	-15.9	201	-77.9	97		-87.4	53		-88.9
	Profit attributable to	Total comprehensive	Basic earnings	Diluted earnings
	owners of parent	income		per share		per share
Three months ended	Millions of yen	%	Millions of yen	%			Yen			Yen
June 30, 2022	-159	-	-158	-			-4.00			-4.00
June 30, 2021	54	-88.8	52	-89.4			1.36			1.36
(Reference)
	Core operating profit	Core EBITDA	Core EBITDA margin
Three months ended	Millions of yen	%	Millions of yen	%			%
June 30, 2022	174	-68.9	672	-35.3			10.6
June 30, 2021	560	-60.4	1,040	-44.7			15.8
(2) Consolidated Financial Position
					Equity attributable to	Ratio of equity
	Total assets	Total equity	attributable to owners of
	owners of parent
					parent to total assets
As of	Millions of yen	Millions of yen	Millions of yen			%
June 30, 2022		33,159		9,674			9,674			29.2
June 30, 2021		36,096		10,470			10,471			29.0

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	‒	14.00		‒		16.00	30.00
March 31, 2022
Fiscal year ending	‒
March 31, 2023
Fiscal year ending
March 31, 2023		14.00		‒		16.00	30.00
(Forecast)

Note: Revisions to the forecast of cash dividends most recently announced: None

3. Forecast of Consolidated Financial Results for the Fiscal Year Ending March 31, 2023 (from April 1, 2022 to March 31, 2023)

(Percentages indicate year-on-year changes.)

	Total income		Operating profit	Profit before tax	Profit		Profit attributable to	Basic earnings
			owners of parent	per share
	Millions of yen		%	Millions of yen	%	Millions of yen	%	Millions of yen	%	Millions of yen	%	Yen
Full year	48,076		2.1	4,893	-1.7	4,490	-1.6	2,951	-1.3	2,951	-1.3	74.03

Note: Revisions from financial results forecasts announced most recently: None

(Reference)

	Core Operating Profit	Core EBITDA		Core EBITDA Margin
	Millions of yen	%	Millions of yen		%	%
Full year	5,060	-9.5	7,212		-4.7	20.9

* Notes

1. Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in the change in scope of consolidation): None
2. Changes in accounting policies and changes in accounting estimates
3. 1. Changes in accounting policies required by IFRS: None
   2. Changes in accounting policies due to other reasons: None
   3. Changes in accounting estimates: None
4. Number of issued shares (ordinary shares)
5. 1. Total number of issued shares at the end of the period (including treasury shares)

As of June 30, 2022	39,910,700 shares
As of March 31, 2022	39,910,700 shares

(ii) Number of treasury shares at the end of the period

As of June 30, 2022	40,000 shares
As of March 31, 2022	40,000 shares

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

Three months ended June 30, 2022	39,870,700 shares
Three months ended June 30, 2021	39,910,700 shares

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

• Proper use of earnings forecasts, and other special matters
  (Caution concerning forward-looking statements)
  The forward-looking statements, such as forecasts of financial results, included in this document are based on information available to the management as of the date of the document and certain assumptions that the management considers reasonable. The Company does not promise that forecasts will be achieved. Actual results may differ significantly due to a range of factors.

(Other special comments)

1. The Company and its consolidated subsidiaries (together, "the Group") apply the International Financial Reporting Standards (hereinafter "IFRS").
2. Core operating profit = Operating profit - IAS41 "Agriculture" applying effects - Other income and expenses - One-time income and expenses
3. Core EBITDA = Core operating profit + Depreciation + Amortization
4. Core EBITDA margin = Core EBITDA / Revenue
5. The effect of applying IAS 41 "Agriculture" is to apply IAS 41 "Agriculture" to the production process of mushrooms, from preparation to harvest, and to measure the mushrooms as biological assets at fair value less costs to sell. The gains or losses from the changes in fair value are considered as the impact amount.
6. Other income and expenses are mainly impairment losses and loss on disposal of fixed assets.
7. One-timeincome and expenses are income and expenses that are not incurred in the normal course of business (For example, listing-related expenses, etc., which were adjustment items in the financial statements for the previous fiscal year, are included). Currently, there are no one-time income and expenses incurred.
8. Core operating profit, Core EBITDA and Core EBITDA margin are not indicators defined by IFRS, but the Group assumes these indicators are useful for investors to evaluate the Group's performance. These financial indicators exclude some expenses and non-recurring gains / losses that are not expected to occur after listing. Core operating profit, Core EBITDA, Core EBITDA should not be considered as indicators to replace the other indicators shown in accordance with IFRS because they do not include some of the items that affect the profit for the period, so they are subject to significant restrictions as means of analysis. Core operating profit, Core EBITDA, Core EBITDA margin disclosed by the Group may be less useful in comparison with the same or similar indicators of other competitors because they are calculated according to a different method from those of such other companies.

(How to obtain supplementary financial results briefing materials and financial results briefing details) Supplementary financial results briefing materials are posted on our website on August 4, 2022.

Accompanying Materials - Contents

Ⅰ. Qualitative Information for the first Three-Month Period of the Fiscal Year Ended March 31, 2023…2

• 1. Analysis of Operating Results………………………………………………………………………………2
  2. Analysis of Financial Position………………………………………………………………………………3
  3. Analysis of Cash Flows ………………………………………………………………………………………4
  4. Explanations about Forward-Looking Information Including Forecast of Consolidated Financial Results…4
• . Summarized Quarterly Consolidated Financial Statements and Significant Notes ……………5
• 1. Summarized Quarterly Consolidated Statements of Financial Position……………………………………5
  2. Summarized Quarterly Consolidated Statements of Income and Comprehensive Income …………………7
  3. Summarized Quarterly Consolidated Statement of Changes in Equity……………………………………9
  4. Summarized Quarterly Consolidated Statements of Cash Flows………………………………10
  5. Notes to Summarized Consolidated Financial Statements…………………………………………………11 (Going Concern Assumptions) ……………………………………………………………………………11 (Segment Information) ……………………………………………………………………………………11 (Earnings per Share) ………………………………………………………………………………………12 (Significant Subsequent Events) …………………………………………………………………………12

- 1 -

Ⅰ. Qualitative Information for the First Three-Months Period of the Fiscal Year Ending March 31, 2023

1. Analysis of Operating Results

During the first quarter of the current consolidated fiscal year (April 1 to June 30, 2022), the Japanese economy showed signs of normalization of economic activities, as vaccination against new coronavirus infection progressed and various regulations to prevent infection were gradually eased. On the other hand, the international situation remains challenging due to Russia's invasion of Ukraine, soaring energy prices, and the yen's depreciation.

In the environment surrounding our business, with the background of soaring crude oil prices, each company has announced a series of food price increases, and consumers are becoming more aware of household defense. The Group's earnings have also been under pressure due to increases in various costs caused by soaring utility unit prices and price hikes in raw materials and other factors. In this environment, the Group is working to establish a foundation as a comprehensive manufacturer of premium mushrooms by leveraging its production technology, know-how, and sales capabilities cultivated over many years in accordance with its Medium-term business plan. In addition, we have been developing our business to contribute to the realization of a healthy society by developing and promoting the functional properties of mushrooms, especially maitake mushrooms, and have been providing safe and reliable products.

The results of many years of research have now borne fruit, and we have succeeded in developing and mass-producing our own fungus of the new white maitake mushroom, and have begun selling "Yukiguni Maitake Kiwami White," in August. This white maitake mushroom is our original variety that inherits not only the nutrients but also the texture and taste of the existing "Yukiguni maitake Kiwami". While the appearance of the white maitake mushroom is beautiful, its delicate nature makes it difficult to cultivate, and there are still many hurdles to overcome for stable production. In order to deliver this white maitake mushroom with even better taste and stability after about 6 years of development, we have succeeded in developing a new fungus that enables stable production with unprecedented high quality. We will continue to expand our lineup of premium mushrooms to follow in the footsteps of "Yukikuni Maitake Kiwami White".

Total income for the first quarter of the current consolidated cumulative period, total income was ¥8,201 million (-8.2%year-on-year), of which revenue was ¥6,367 million (-3.3%year-on-year). Gross profit was ¥1,628 million (-19.9%year-on-year). Selling, general and administrative (SG&A) expenses were ¥1,787 million (-2.1%year-on-year).

As a result of the above, operating loss was ¥163 million (operating profit of ¥201 million in the same period of the previous year) and loss attributable to owners of the parent was ¥159 million (profit attributable to owners of the parent of ¥54 million in the same period of the previous year).

In the current consolidated cumulative period, gains arising from changes in fair value related to the application of IFRS Agricultural Accounting (IAS 41) were included in total income of ¥1,833 million (- 22.0% year-on-year) and the cost of sales of ¥2,137 million (-18.5%year-on-year).

[Business results for the three months ended June 30, 2022]

(Millions of yen)

	Three months ended	Three months ended	% Change
	June 30, 2021	June 30, 2022	year-on-year
Revenue	6,587	6,367	(3.3)
Gains arising from changes in fair	2,350	1,833	(22.0)
value
Total income	8,938	8,201	(8.2)
Operating profit (loss)	201	(163)	-
Profit (loss) before tax	97	(258)	-
Profit (loss) attributable to owners of	54	(159)	-
parent

The status of revenue by business segment during the current consolidated fiscal year is as follows. [Mushroom business]

1) Maitake

- 2 -