Takara Holdings Inc.TSE: 2531

1Q Results, ended 06/30/24 FS

Sep 10, 2024 at 6:27 AM UTC · Issued by Takara Holdings Inc.

The original disclosure in Japanese was released on August 8, 2024 at 15:30 (GMT+9)

Consolidated Financial Statements for the First Quarter Ended June 30, 2024 FY2025 (April 1, 2024 - March 31, 2025) [UNAUDITED]

Company name:	Takara Holdings Inc.
Stock exchange listings:	Tokyo Stock Exchange (PRIME section)
Code number:	2531
URL:	https://www.takara.co.jp/
Company representative:	Mutsumi Kimura, President
Contact:	Masakazu Usami, General Manager of Public Relations& Investor Relations Dept..
	TEL：(075)241-5124

Notes:	1. The accompanying financial statements have been prepared in accordance with accounting principles and practices generally accepted
	in Japan.

2. Amounts are rounded down to the nearest million yen.

1. Results for the three months ended June 30, 2024 (April 1, 2024- June 30, 2024)

Consolidated operating results

Note: Percentages indicated changes from the same period of the previous fiscal year.
	Three months ended	Three months ended
	June 30, 2024		June 30, 2023
	(Millions of yen)	(%)	(Millions of yen)	(%)
Net sales	84,956	4.2	81,510	4.8
Operating income (loss)	4,064	(42.8)	7,101	(20.2)
Ordinary income (loss)	4,791	(37.8)	7,700	(16.8)
Net income (loss) attributable to owners of the parent	5,170	4.1	4,965	(5.3)
Net income (loss) per share (Yen)	26.48		25.11
Fully diluted net income per share (Yen)	-		-
Note: Comprehensive income (loss)	11,567	3.6	11,166	(14.7)

(2) Consolidated financial position
				As of June 30, 2024		As of March 31, 2024
					(Millions of yen)		(Millions of yen)
	Total assets			439,765		437,468
	Net assets			285,543		280,465
	Equity ratio (%)			53.0		52.3
	(Reference) Equity			233,263		228,665
2. Dividends
					Dividend per share (Yen)
		Year ended March 31,		Year ending March 31,	Year ending March 31,
		2024			2025		2025 (Forecast)
	First quarter end	-		-		-
	Second quarter end	-	-		-
	Third quarter end	-	-		-
	Year end	29.00	-		31.00
	Annual	29.00	-		31.00

Note: Correction of dividend forecast from the most recent dividend forecast: No

3. Forecast for the year ending March 31, 2025(April 1, 2024 - March 31, 2025)

Note: Percentages indicated changes from the same period of the previous fiscal year.

	Six months ending		Year ending March 31, 2025
	September 30, 2024

	(Millions of yen)	(%)	(Millions of yen)	(%)
Net sales	171,000	4.8	362,000	6.7
Operating income (loss)	10,400	(16.6)	25,700	15.5
Ordinary income (loss)	10,800	(17.1)	26,300	12.7
Net income (loss) attributable to owners of the parent	8,600	6.9	17,200	6.3
Net income per share (Yen)	44.04		88.09

Note: Correction of financial forecast from the most recent financial forecast: No

4. Others

Material changes in subsidiaries during this period

(Changes in specified subsidiaries that caused a change in the scope of consolidation): No

Accounting procedures specific to quarterly consolidated financial statements ： No
Changes in accounting policies, accounting estimates and retrospective restatement
1. Changes based on revisions of accounting standard: Yes
2. Changes other than ones based on revisions of accounting standard: No
3. Changes in accounting estimates: No
4. Restatement: No
Number of outstanding shares (common stock)
1. Number of outstanding shares at the end of each period (Treasury stocks are included):


	As of June 30, 2024 ：	197,252,043 shares
	As of March 31, 2024 ：	197,252,043 shares
2)	Number of treasury stocks at the end of each period:
	As of June 30, 2024 ：	1,995,688shares
	As of March 31, 2024 ：	1,995,688 shares
3)	Average number of outstanding shares in each period
	Three months ended June 30, 2024	：	195,256,355 shares
	Three months ended June 30, 2023	：	197,704,131 shares

Review of the Japanese-language originals of the attached consolidated quarterly financial statements by certified public accountants or an audit firm: Yes (voluntary)

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. The Company

assumes no responsibility for this translation or for direct, indirect or any other forms of damages arising from the

translation.

Comment regarding appropriate use of earnings forecasts and other special notes
Forward-looking statements contained in this document are determined by the Takara Bio Inc. (the "Company") based on information currently available to the Company and include a number of uncertainties. Actual results could differ from these forecasts due to changes in conditions that occur in the future. For information regarding the above, please refer to "1. Overview of Financial Results for the Three Months ended June 30, 2024 (3) Explanation of Consolidated Financial Forecasts and Other Forward-looking Statements" on page 4 of the attached document.

Contents of the attached document

1. Overview of Financial Results ………………………………………….…………………………………………………	2
(1) Overview of Financial Results for the Period under Review ………………………………………….………………	2
(2) Overview of Financial Position for the Period under Review …………………………………………………………	3
(3) Qualitative Information Regarding Consolidated Forecasts …………………………………..………………………	4
2. Consolidated Quarterly Financial Statements and Primary Notes …………………………………………………………	5
(1) Consolidated Balance Sheets ……………………………………………………………………….…………………	5
(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income ………………………	7
(Consolidated Statements of Income) …………………………………………………………………………..……	7
(For the Three Months Ended June 30, 2024 and 2023)
(Consolidated Statements of Comprehensive Income) ………………………………………………………………	8
(For the Three Months Ended June 30, 2024 and 2023)
(3) Notes to Consolidated Financial Statements …………………………………………………………….……………	9
(Notes on Premise of Going Concern) ………………………………………………………………………………	9

(Notes on Material Changes in Shareholders' Equity) ………………………………………………………………	9

(Notes on Changes in Accounting Policies) …………………………………………………………………………	9

(Notes on Segment Information, etc.) …………………………………………………………………………………	9

(Notes on Consolidated Statements of Cash Flows) …………………………………………………………………	10

Independent Auditor's Report on Interim Review of Consolidated Quarterly Financial Statements
○ Supplement for the Consolidated Quarterly Financial Statements

－ 1 －

1. Overview of Financial Results

Overview of Financial Results for the Period under Review

In the three months ended June 30, 2024, net sales increased 4.2% year on year to ¥84,956 million, gross profit decreased 2.4% year on year to ¥27,360 million, and SG&A expenses increased 11.3% year on year to ¥23,295 million. Operating income decreased 42.8% year on year to ¥4,064 million, ordinary income decreased 37.8% year on year to ¥4,791 million, and net income attributable to owners of parent increased 4.1% year on year to ¥5,170 million mainly due to an increase in extraordinary income as a result of sale of noncurrent assets and investment securities.

Results by business segment were as follows.

[Takara Shuzo]

In the three months ended June 30, 2024, sales of shochu and sake decreased year on year, and despite continued growth in sales of Takara Shochu Highball, total sales of light-alcohol refreshers decreased. Sales of seasonings increased due to an increase in sales of Hon Mirin and food seasonings. Sales of raw alcohol, etc. decreased.

As a result, net sales for Takara Shuzo decreased 5.0% year on year to ¥30,170 million. Cost of sales decreased 3.6% year on year to ¥22,541 million in line with the decrease in net sales, despite the impact of rising raw material prices and other factors. Gross profit decreased 9.0% year on year to ¥7,629 million. SG&A expenses increased 5.6% year on year to ¥6,109 million due to an increase in advertising expenses, etc. Operating income was down 41.5% year on year to ¥1,519 million.

[Takara Shuzo International Group]

In the three months ended June 30, 2024, net sales of the Overseas Alcoholic Beverages Business increased year on year mainly due to continued growth in sales of whiskey as well as an increase in sales of sake, etc. Net sales of the Japanese Food Wholesale Business in overseas markets also increased primarily due to continued efforts made to acquire new customers and procure products tailored to customer needs despite the impact of a slow-down in personal consumption in the U.S., Europe, etc.

As a result, net sales for the Takara Shuzo International Group increased 15.5% year on year to ¥43,220 million. Cost of sales increased 14.5% year on year to ¥28,894 million in line with the increase in net sales. Consequently, gross profit increased 17.4% year on year to ¥14,326 million. SG&A expenses were up 23.5% year on year to ¥10,643 million, primarily due to an increase in personnel expenses, and operating income was up 2.7% year on year to ¥3,683 million.

[Takara Bio Group]

In the three months ended June 30, 2024, net sales for the Takara Bio Group decreased 7.4% year on year to ¥8,493 million, primarily due to a decrease in sales of COVID-19testing-related products and a slump in the life sciences research market. Cost of sales increased 54.3% year on year to ¥4,139 million, mainly due to a decrease in sales of testing-related reagents with relatively high profit margins and the impact of a change in the sales mix. Gross profit decreased 32.9% year on year to ¥4,353 million. SG&A expenses were down 1.3% year on year to ¥5,988 million, and operating loss amounted to ¥1,634 million, compared to operating income of ¥423 million in the three months ended June 30, 2023.

[Other]

In the three months ended June 30, 2024, net sales of the Other segment increased 1.6% year on year to ¥7,745 million primarily due to an increase in the import and sale of wine. Cost of sales increased 0.5% year on year to ¥6,499 million, and gross profit increased 7.7% year on year to ¥1,245 million. SG&A expenses rose 6.0% year on year to ¥497 million primarily due to an increase in personnel expenses, and operating income was up 8.9% year on year to ¥748 million.

－ 2 －

Breakdown of sales results by product category

		Equivalent Period of	Period under Review
		Previous Fiscal Year	YoY
	Segment	(From April 1, 2024
	(From April 1, 2023	Comparison
		to June 30, 2024)
		to June 30, 2023)

	Product category	Amount (Millions of yen)	Amount (Millions of yen)	(%)

Takara Shuzo
	Shochu	9,612	8,722	(9.3)
	Sake	2,292	2,122	(7.4)
	Light-alcohol refreshers	10,684	10,490	(1.8)
	Other alcoholic beverages	1,486	1,421	(4.4)
	Hon Mirin	2,328	2,408	3.4
	Other seasonings	2,215	2,280	2.9
	Raw alcohol, etc.	3,153	2,724	(13.6)
	Total	31,773	30,170	(5.0)
Takara Shuzo International Group
	Overseas Alcoholic	4,889	5,603	14.6
	Beverages Business

	Japanese Food
	Wholesales Business in	33,140	38,284	15.5
	overseas markets
	Other	198	207	4.5
	Elimination of intra-Group	(796)	(874)	－
	transaction on consolidation

	Total	37,432	43,220	15.5
Takara Bio Group
	Reagents	6,809	6,606	(3.0)
	Instruments	220	221	0.3
	CDMO	1,366	1,018	(25.5)
	Gene therapy	778	647	(16.9)
	Total	9,176	8,493	(7.4)
	Reported segment total	78,382	81,884	4.5
Other	7,623	7,745	1.6
	Segment total	86,005	89,630	4.2
Sales not allocated to
business segments and	(4,495)	(4,673)	－
intersegment transactions
	Total	81,510	84,956	4.2
Notes: 1. Amounts include alcohol tax.

2. From the three months ended June 30, 2024, the Takara Bio Group began adding sales of mRNA manufacturing related products, etc. for research use, which had been included in "Reagents" until the fiscal year ended March 31, 2024, to "Gene therapy." In this table, this change is applied and the results for the three months ended June 30, 2023 have been modified.
Overview of Financial Position for the Period under Review

As of June 30, 2024, current assets were ¥245,804 million, an increase of ¥591 million compared with that at the end of the previous fiscal year. This was primarily due to increases in notes and accounts receivable-trade of ¥842 million, inventories of ¥3,665 million, and other current assets of ¥946 million, despite a decrease in cash and deposits of ¥4,830 million. Noncurrent assets were ¥193,960 million, an increase of ¥1,705 million compared with that at the end of the previous fiscal year. This was due to increases in property, plant and equipment of ¥1,978 million, mainly due to increases in buildings and structures and construction in progress, and intangible assets of ¥782 million, despite a decrease in investments and other assets of ¥1,055 million mainly due to a decrease in investment securities.

As a result, total assets were ¥439,765 million, an increase of ¥2,297 million compared with that at the end of the

－ 3 －

previous fiscal year.

As of June 30, 2024, current liabilities were ¥82,520 million, an increase of ¥1,863 million compared with that at the end of the previous fiscal year. This was primarily due to increases in short-term loans payable of ¥5,667 million, accrued alcohol tax of ¥1,623 million, provision for bonuses of ¥1,001 million, and other current liabilities of ¥992 million, despite decreases in current portion of bonds of ¥5,000 million and accrued expenses of ¥3,253 million. Noncurrent liabilities were ¥71,701 million, a decrease of ¥4,644 million compared with that at the end of the previous fiscal year. This was primarily due to a decrease in long-term loans payable of ¥5,021 million.

As a result, total liabilities were ¥154,221 million, a decrease of ¥2,781 million compared with that at the end of the previous fiscal year.

As of June 30, 2024, total net assets were ¥285,543 million, an increase of ¥5,078 million compared with that at the end of the previous fiscal year. This was primarily due to an increase in foreign currency translation adjustment of ¥6,765 million, offset by a decrease in valuation difference on available-for-sale securities of ¥1,808 million.

As a result, the equity ratio totaled 53.0%, compared with 52.3% at the end of the previous fiscal year.

(3) Qualitative Information Regarding Consolidated Forecasts

There are no changes to the consolidated results forecasts for the six months ending September 30, 2024 and the fiscal year ending March 31, 2025 published in the financial statements on May 10, 2024.

－ 4 －

2. Consolidated Quarterly Financial Statements and Primary Notes

Consolidated Balance Sheets

		(Millions of Yen)
	As of Mar. 31, 2024	As of June 30, 2024

Assets
Current assets
Cash and deposits	95,085	90,255
Notes and accounts receivable-trade	70,123	70,966
Merchandise and finished goods	61,834	64,905
Work in process	1,659	2,014
Raw materials and supplies	7,558	7,797
Other	9,768	10,714
Allowance for doubtful accounts	(817)	(849)
Total current assets	245,213	245,804
Noncurrent assets
Property, plant and equipment	104,882	106,861
Intangible assets
Goodwill	12,154	12,523
Other	6,181	6,594
Total intangible assets	18,336	19,118
Investments and other assets
Investment securities	43,597	40,387
Other	25,502	27,656
Allowance for doubtful accounts	(62)	(62)
Total investments and other assets	69,036	67,981
Total noncurrent assets	192,254	193,960
Total assets	437,468	439,765

－ 5 －

		(Millions of Yen)
	As of Mar. 31, 2024	As of June 30, 2024

Liabilities
Current liabilities
Notes and accounts payable-trade	22,315	22,815
Short-term loans payable	10,008	15,676
Current portion of bonds	5,000	‒
Accrued alcohol tax	8,174	9,797
Accrued expenses	8,826	5,572
Income taxes payable	2,600	3,059
Provision for bonuses	3,470	4,471
Other provision	479	352
Other	19,782	20,774
Total current liabilities	80,657	82,520
Noncurrent liabilities
Bonds payable	15,000	15,000
Long-term loans payable	10,422	5,401
Net defined benefit liability	8,735	8,728
Other	42,187	42,570
Total noncurrent liabilities	76,345	71,701
Total liabilities	157,003	154,221
Net assets
Shareholders' equity
Capital stock	13,226	13,226
Capital surplus	2,716	2,804
Retained earnings	169,909	169,417
Treasury stock	(2,103)	(2,103)
Total shareholders' equity	183,749	183,345
Accumulated other comprehensive income
Valuation difference on available-for-sale securities	22,511	20,702
Deferred gains or losses on hedges	3	11
Foreign currency translation adjustment	22,389	29,154
Remeasurements of defined benefit plans	12	50
Total accumulated other comprehensive income	44,915	49,918
Noncontrolling interests	51,799	52,279
Total net assets	280,465	285,543
Total liabilities and net assets	437,468	439,765

－ 6 －

(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income

(Consolidated Statements of Income)

(For the Three Months Ended June 30, 2024 and 2023)

		(Millions of Yen)
	FY2024	FY2025
	(Apr. 1, 2023 -	(Apr. 1, 2024 -
	June 30, 2023)	June 30, 2024)

Net sales	81,510	84,956
Cost of sales	53,471	57,595
Gross profit	28,039	27,360
Selling, general and administrative expenses	20,937	23,295
Operating income	7,101	4,064
Nonoperating income
Dividends income	471	462
Other	275	550
Total nonoperating income	746	1,013
Nonoperating expenses
Interest expenses	91	155
Other	56	131
Total nonoperating expenses	148	287
Ordinary income	7,700	4,791
Extraordinary income
Gain on sale of noncurrent assets	11	803
Gain on sale of investment securities	8	1,679
Other	‒	12
Total extraordinary income	19	2,495
Extraordinary loss
Loss on sale and retirement of noncurrent assets	27	51
Other	‒	8
Total extraordinary losses	27	59
Income before income taxes	7,692	7,227
Income taxes-current	2,754	3,082
Income taxes-deferred	(514)	(876)
Total income taxes	2,240	2,205
Net income	5,451	5,021
Net income (loss) attributable to the noncontrolling	486	(149)
interest

Net income attributable to owners of the parent	4,965	5,170

－ 7 －

(Consolidated Statements of Comprehensive Income)

(For the Three Months Ended June 30, 2024 and 2023)

		(Millions of Yen)
	FY2024	FY2025
	(Apr. 1, 2023 -	(Apr. 1, 2024 -
	June 30, 2023)	June 30, 2024)

Net income	5,451	5,021
Other comprehensive income
Valuation difference on available-for-sale securities	3,752	(1,808)
Deferred gains or losses on hedges	93	8
Foreign currency translation adjustment	1,817	8,301
Remeasurements of defined benefit plans	50	45
Total other comprehensive income	5,715	6,546
Comprehensive income	11,166	11,567
(Comprehensive income attributable to)
Comprehensive income attributable to owners of the	10,431	10,173
parent

Comprehensive income attributable to noncontrolling	734	1,394
interest

－ 8 －