Summary of Consolidated Financial Results for the Year Ended May 31, 2024(Based on Japanese GAAP)

Jul 11, 2024 at 10:00 PM UTC · Issued by Daito Pharmaceutical Co., Ltd.

Translation

Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes. In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

Summary of Consolidated Financial Results

for the Year Ended May 31, 2024

(Based on Japanese GAAP)

																			July 12, 2024
Company name:	Daito Pharmaceutical Co., Ltd.
Stock exchange listing:	Tokyo
Stock code:	4577	URL https://www.daitonet.co.jp/
Representative:	President and CEO			Yasunobu Otsuga
Inquiries:	Director of Corporate Planning			Koichi Takabatake	TEL 076-421-5665
Scheduled date of ordinary general meeting of shareholders:	August 29, 2024
Scheduled date to file Securities Report:			August 30, 2024
Scheduled date to commence dividend payments:			August 6, 2024
Preparation of supplementary material on financial results:	Yes
Holding of financial results meeting:							Yes	(for analysts and institutional investors)
												(Amounts less than one million yen are rounded down)
1. Consolidated financial results for the year ended May 31, 2024 (from June 1, 2023 to May 31, 2024)
(1) Consolidated operating results													Percentages indicate year-on-year changes
			Net sales			Operating profit	Ordinary profit	Profit attributable to
					owners of parent

			Millions of yen		%	Millions of yen		%	Millions of yen	%		Millions of yen		%
Year ended May 31, 2024		46,895		4.0	3,894		(25.2)		3,923	(24.1)	3,295		(8.5)
Year ended May 31, 2023		45,101		3.8	5,207		(20.5)		5,169	(23.2)	3,600		(22.9)

			Earnings per share		Diluted earnings per	Profit attributable to		Ordinary profit/total	Operating profit/net
					share			owners of				assets			sales
										parent/equity

				Yen			Yen				%					%			%
Year ended May 31, 2024		210.00			-				6.4						5.3			8.3
Year ended May 31, 2023		227.63		227.42				7.3						7.6			11.5
(2) Consolidated financial position
			Total assets			Net assets		Equity ratio	Net assets per share
			Millions of yen	Millions of yen					%						Yen
As of May 31, 2024			77,708					52,265					67.0			3,404.70
As of May 31, 2023			70,552					50,971					71.8			3,206.50
(3) Consolidated cash flows
			Cash flows from	Cash flows from	Cash flows from	Cash and cash equivalents
			operating activities	investing activities	financing activities		at end of period
			Millions of yen	Millions of yen	Millions of yen		Millions of yen
Year ended May 31, 2024					5,182					(5,930)					(183)				2,727
Year ended May 31, 2023					4,155					(5,566)					616				3,607
2. Cash dividends
							Annual dividends per share					Total cash		Dividend payout	Ratio of dividends
																to net assets
			1st quarter-end	2nd quarter-end	3rd quarter-end	Fiscal year-end	Total			dividends (Total)	ratio (Consolidated)	(Consolidated)


			Yen			Yen	Yen				Yen	Yen	Millions of yen		%		%
Year ended May 31, 2023		-		30.00	-				30.00	60.00		861		24.0		1.8
Year ended May 31, 2024		-		30.00	-				30.00	60.00		932		28.6		1.8
Year ending May 31, 2025		-			35.00	-				35.00	70.00				46.5
(Forecast)

3. Forecast of consolidated financial results for the year ending May 31, 2025 (from June 1, 2024 to May 31, 2025)

Percentages indicate year-on-year changes

Net sales

Operating profit

Ordinary profit

Profit attributable to

Earnings per share

owners of parent

Millions of yen

Yen

Full year

49,000

4.5

3,500

(10.1)

3,500

(10.8)

2,300

(30.2)

150.39

4. Notes

(1) Changes in significant subsidiaries during the year ended May 31, 2024

(changes in specified subsidiaries resulting in the change in scope of consolidation):

(2) Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial statements

Changes in accounting policies due to revisions to accounting standards and other regulations:

Changes in accounting policies due to other reasons:

Changes in accounting estimates:

Restatement of prior period financial statements:

(3) Number of issued shares (common shares)

Total number of issued shares at the end of the period (including treasury shares)

As of May 31, 2024

15,698,440 shares

As of May 31, 2023

15,858,440 shares

Number of treasury shares at the end of the period

As of May 31, 2024

405,273 shares

As of May 31, 2023

55,413 shares

Average number of shares during the period

Year ended May 31, 2024

15,691,088 shares

Year ended May 31, 2023

15,815,480 shares

Consolidated financial statements

Consolidated balance sheets

		(Millions of yen)
	As of May 31, 2023	As of May 31, 2024
Assets
Current assets
Cash and deposits	3,607	2,727
Notes receivable - trade	983	335
Accounts receivable - trade	9,687	10,496
Electronically recorded monetary claims - operating	6,974	4,567
Merchandise and finished goods	5,626	7,877
Work in process	5,577	5,948
Raw materials and supplies	7,035	7,065
Factoring credit	12	44
Consumption taxes refund receivable	89	1,292
Other	1,071	1,107
Allowance for doubtful accounts	(2)	(1)
Total current assets	40,663	41,460
Non-current assets
Property, plant and equipment
Buildings and structures, net	11,727	18,291
Machinery, equipment and vehicles, net	6,352	6,343
Land	2,049	2,126
Leased assets, net	75	1,770
Construction in progress	4,618	2,194
Other, net	1,013	1,246
Total property, plant and equipment	25,837	31,972
Intangible assets
Other	377	490
Total intangible assets	377	490
Investments and other assets
Investment securities	2,964	3,188
Deferred tax assets	504	320
Other	215	283
Allowance for doubtful accounts	(10)	(8)
Total investments and other assets	3,673	3,784
Total non-current assets	29,888	36,247
Total assets	70,552	77,708

		(Millions of yen)
	As of May 31, 2023	As of May 31, 2024
Liabilities
Current liabilities
Notes and accounts payable - trade	4,435	5,262
Electronically recorded obligations - operating	3,461	3,437
Current portion of long-term borrowings	1,429	2,099
Lease liabilities	15	275
Income taxes payable	559	195
Provision for bonuses	54	58
Accounts payable - other	3,729	4,486
Accrued expenses	1,037	993
Other	705	1,695
Total current liabilities	15,428	18,505
Non-current liabilities
Long-term borrowings	3,368	4,669
Lease liabilities	77	1,676
Deferred tax liabilities	31	32
Provision for share awards for directors (and other	10	20
officers)

Retirement benefit liability	497	320
Other	165	217
Total non-current liabilities	4,151	6,937
Total liabilities	19,580	25,443
Net assets
Shareholders' equity
Share capital	7,186	7,186
Capital surplus	7,072	7,072
Retained earnings	35,006	37,087
Treasury shares	(124)	(990)
Total shareholders' equity	49,140	50,355
Accumulated other comprehensive income
Valuation difference on available-for-sale securities	1,159	1,332
Foreign currency translation adjustment	324	369
Remeasurements of defined benefit plans	48	11
Total accumulated other comprehensive income	1,532	1,713
Non-controlling interests	299	196
Total net assets	50,971	52,265
Total liabilities and net assets	70,552	77,708

Consolidated statements of income and consolidated statements of comprehensive income Consolidated statements of income

		(Millions of yen)
	Fiscal year ended	Fiscal year ended
	May 31, 2023	May 31, 2024
Net sales	45,101	46,895
Cost of sales	34,770	37,056
Gross profit	10,331	9,839
Selling, general and administrative expenses	5,123	5,945
Operating profit	5,207	3,894
Non-operating income
Interest income	0	0
Dividend income	57	65
Rental income	14	15
Insurance claim income	-	27
Reversal of allowance for doubtful accounts	4	0
Other	8	17
Total non-operating income	86	126
Non-operating expenses
Interest expenses	12	41
Commission expenses	10	28
Foreign exchange losses	91	23
Other	9	3
Total non-operating expenses	124	97
Ordinary profit	5,169	3,923
Extraordinary income
Subsidy income	12	135
Gain on sale of investment securities	-	326
Other	-	0
Total extraordinary income	12	461
Extraordinary losses
Loss on retirement of non-current assets	17	48
Loss on tax purpose reduction entry of non-current assets	-	117
Loss on valuation of investment securities	20	-
Loss on sale of investment securities	67	-
Other	-	0
Total extraordinary losses	105	166
Profit before income taxes	5,076	4,218
Income taxes - current	1,595	902
Income taxes - deferred	(46)	138
Total income taxes	1,549	1,040
Profit	3,527	3,178
Loss attributable to non-controlling interests	(72)	(116)
Profit attributable to owners of parent	3,600	3,295

Consolidated statements of comprehensive income

		(Millions of yen)
	Fiscal year ended	Fiscal year ended
	May 31, 2023	May 31, 2024
Profit	3,527	3,178
Other comprehensive income
Valuation difference on available-for-sale securities	281	173
Foreign currency translation adjustment	21	59
Remeasurements of defined benefit plans, net of tax	208	(37)
Total other comprehensive income	511	194
Comprehensive income	4,038	3,373
Comprehensive income attributable to
Comprehensive income attributable to owners of parent	4,107	3,476
Comprehensive income attributable to non-controlling	(68)	(102)
interests

Consolidated statements of changes in equity

Fiscal year ended May 31, 2023

								(Millions of yen)
			Shareholders' equity

				Retained				Total
	Share capital	Capital surplus			Treasury shares	shareholders'
		earnings
						equity

Balance at beginning of	7,031	6,917		32,338			(13)	46,273
period

Changes during period

Issuance of new shares -
exercise of share	154	154						309
acquisition rights
Dividends of surplus				(932)				(932)

Profit attributable to				3,600				3,600
owners of parent

Purchase of treasury							(0)	(0)
shares

Acquisition of treasury
stock by stock transfer							(110)	(110)
trust
Net changes in items other
than shareholders' equity
Total changes during period	154	154		2,667			(110)	2,866

Balance at end of period	7,186	7,072		35,006			(124)	49,140


	Accumulated other comprehensive income

	Valuation	Foreign					Total	Share	Non-controlling
		Remeasurements			accumulated
	difference on	currency			acquisition	Total net assets
		of defined			other	interests
	available-for-	translation			rights
		benefit plans			comprehensive
	sale securities	adjustment
					income

Balance at beginning of	877	306		(159)			1,024	7	367	47,674
period

Changes during period

Issuance of new shares -
exercise of share										309
acquisition rights
Dividends of surplus										(932)

Profit attributable to										3,600
owners of parent

Purchase of treasury										(0)
shares

Acquisition of treasury
stock by stock transfer										(110)
trust
Net changes in items other	281	17		208			507	(7)	(68)	431
than shareholders' equity

Total changes during period	281	17		208			507	(7)	(68)	3,297

Balance at end of period	1,159	324		48			1,532	-	299	50,971

Fiscal year ended May 31, 2024

							(Millions of yen)
			Shareholders' equity

				Retained			Total
	Share capital	Capital surplus			Treasury shares	shareholders'
		earnings
						equity

Balance at beginning of	7,186	7,072		35,006		(124)	49,140
period

Changes during period

Dividends of surplus				(907)			(907)

Profit attributable to				3,295			3,295
owners of parent

Purchase of treasury						(1,176)	(1,176)
shares

Cancellation of treasury				(306)		306	-
shares

Disposal of treasury stock						4	4
by stock transfer trust

Net changes in items other
than shareholders' equity
Total changes during period	-	-		2,081		(865)	1,215

Balance at end of period	7,186	7,072		37,087		(990)	50,355


	Accumulated other comprehensive income

	Valuation	Foreign				Total	Non-controlling
		Remeasurements		accumulated	Total net assets
	difference on	currency
		of defined		other	interests
	available-for-	translation
		benefit plans		comprehensive
	sale securities	adjustment
				income

Balance at beginning of	1,159	324		48		1,532	299	50,971
period

Changes during period

Dividends of surplus								(907)

Profit attributable to								3,295
owners of parent

Purchase of treasury								(1,176)
shares

Cancellation of treasury								-
shares

Disposal of treasury stock								4
by stock transfer trust

Net changes in items other	173	45		(37)		180	(102)	78
than shareholders' equity

Total changes during period	173	45		(37)		180	(102)	1,293

Balance at end of period	1,332	369		11		1,713	196	52,265

Consolidated statements of cash flows

		(Millions of yen)
	Fiscal year ended	Fiscal year ended
	May 31, 2023	May 31, 2024
Cash flows from operating activities
Profit before income taxes	5,076	4,218
Depreciation	3,870	3,659
Loss on retirement of non-current assets	17	48
Loss on tax purpose reduction entry of non-current assets	-	117
Increase (decrease) in allowance for doubtful accounts	(3)	(1)
Increase (decrease) in provision for bonuses	3	4
Increase (decrease) in retirement benefit liability	41	(230)
Increase (decrease) in provision for share awards for directors	10	10
(and other officers)

Interest and dividend income	(58)	(66)
Rental income	(14)	(15)
Insurance claim income	-	(17)
Interest expenses	12	41
Subsidy income	(12)	(135)
Foreign exchange losses (gains)	(12)	(78)
Loss (gain) on sale of investment securities	67	(326)
Loss (gain) on valuation of investment securities	20	-
Decrease (increase) in trade receivables	(1,502)	2,221
Decrease (increase) in inventories	(1,413)	(2,640)
Increase (decrease) in trade payables	538	802
Decrease (increase) in consumption taxes refund receivable	-	(1,292)
Other, net	(126)	(52)
Subtotal	6,514	6,265
Interest and dividends received	58	66
Interest paid	(13)	(40)
Subsidies received	12	135
Income taxes paid	(2,411)	(1,265)
Insurance claim income received	-	17
Other, net	(5)	4
Net cash provided by (used in) operating activities	4,155	5,182

		(Millions of yen)
	Fiscal year ended	Fiscal year ended
	May 31, 2023	May 31, 2024
Cash flows from investing activities
Purchase of property, plant and equipment	(5,505)	(6,220)
Purchase of intangible assets	(51)	(56)
Proceeds from sale of investment securities	-	335
Other, net	(8)	10
Net cash provided by (used in) investing activities	(5,566)	(5,930)
Cash flows from financing activities
Proceeds from long-term borrowings	3,000	4,000
Repayments of long-term borrowings	(1,638)	(2,029)
Dividends paid	(931)	(907)
Purchase of treasury shares	(110)	(1,176)
Repayments of lease liabilities	(5)	(70)
Proceeds from issuance of shares resulting from exercise of	308	-
share acquisition rights

Payments from the gain of own stock acquisition rights	(6)	-
Net cash provided by (used in) financing activities	616	(183)
Effect of exchange rate change on cash and cash equivalents	20	51
Net increase (decrease) in cash and cash equivalents	(774)	(879)
Cash and cash equivalents at beginning of period	4,381	3,607
Cash and cash equivalents at end of period	3,607	2,727

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