Warabeya Nichiyo Holdings Co., Ltd.TSE: 2918

Summary of Consolidated Financial Results for the Year Ended February 28, 2021

Apr 16, 2021 at 6:08 AM UTC · Issued by Warabeya Nichiyo Holdings 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 February 28, 2021

(Based on Japanese GAAP)

				April 9, 2021
Company name:	WARABEYA NICHIYO HOLDINGS CO., LTD.
Stock exchange listing:	Tokyo
Stock code:	2918	URL https://www.warabeya.co.jp/ja/index.html
Representative:	Representative Director, President	Hiroyuki Otomo
Inquiries:	Director, Managing Executive Officer	Naoshi Asano	TEL 03-5363-7010
Scheduled date of ordinary general meeting of shareholders:	May 27, 2021
Scheduled date to file Securities Report:	May 28, 2021
Scheduled date to commence dividend payments:	May 28, 2021
Preparation of supplementary material on financial results:	Yes
Holding of financial results meeting:		Yes	(for institutional investors and analysts)

(Amounts less than one million yen are rounded down)

1. Consolidated financial results for the year ended February 28, 2021 (from March 1, 2020 to February 28, 2021)

(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 February 28, 2021	194,309	(9.0)	3,332	22.4	3,710	33.8	682	(32.4)
Year ended February 29, 2020	213,581	(1.0)	2,721	78.3	2,773	57.0	1,010	65.5

(Note) Comprehensive income:

Year ended February 28, 2021: ¥508 million [(48.8)%]

Year ended February 29, 2020: ¥992 million [118.6%]

Diluted earnings per

Profit attributable to

Ordinary profit/total

Operating profit/net

Earnings per share

owners of

parent/equity

assets

sales

Yen

Year ended February 28, 2021

39.04

1.5

4.4

1.7

Year ended February 29, 2020

57.55

2.3

3.2

1.3

(Reference) Equity in earnings of affiliates:

Year ended February 28, 2021: ¥120 million

Year ended February 29, 2020: ¥- million

(2) Consolidated financial position

Total assets

Net assets

Equity ratio

Net assets per share

Millions of yen

Yen

As of February 28, 2021

82,273

44,372

53.7

2,530.40

As of February 29, 2020

86,078

44,523

51.5

2,526.24

(Reference) Equity capital:

As of

February 28, 2021: ¥44,164

million

As of February 29, 2020: ¥44,342 million

(3) Consolidated cash flows

Cash flows from

Cash and cash equivalents

operating activities

investing activities

financing activities

at end of period

Millions of yen

Year ended February 28, 2021

8,338

(5,226)

(1,922)

8,946

Year ended February 29, 2020

11,379

(1,349)

(4,556)

7,902

2. Cash dividends

		Annual dividends per share		Total cash	Dividend payout	Ratio of dividends
						to net assets
						dividends (Total)	ratio (Consolidated)
	1st quarter-end	2nd quarter-end	3rd quarter-end	Fiscal year-end	Total	(Consolidated)


	Yen	Yen	Yen	Yen	Yen	Millions of yen	%	%
Year ended February 29, 2020	-	0.00	-	40.00	40.00	704	69.5	1.6
Year ended February 28, 2021	-	0.00	-	40.00	40.00	704	102.5	1.6
Year ending February 28, 2022	-	0.00	-	40.00	40.00		24.9
(Forecast)

(Note) Total cash dividends for the year ended February 29, 2020 and the year ended February 28, 2021, respectively, include dividends of ¥2 million and ¥6 million paid for shares of the Company held by the BIP Trust.

3. Forecast of consolidated financial results for the year ending February 28, 2022 (from March 1, 2021 to February 28, 2022)

(Percentages indicate year-on-year changes)

	Net sales		Operating profit	Ordinary profit		Profit attributable to	Earnings per share
			owners of parent

Six months ending	Millions of yen	%	Millions of yen	%	Millions of yen	%	Millions of yen	%	Yen
99,000	2.5	2,700	124.0	2,950	92.1		1,660	-	95.11
August 31, 2021

Full year	198,000	1.9	4,500	35.1	4,900	32.0		2,800	310.1	160.43
* Notes
(1) Changes in significant subsidiaries during the year ended February 28, 2021			No
(changes in specified subsidiaries resulting in the change in scope of consolidation):

Newly consolidated: -	Excluded: -
(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:	No
Changes in accounting policies due to other reasons:					No
Changes in accounting estimates:							Yes
Restatement of prior period financial statements:					No

(3) Number of issued shares (common shares)

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

	As of February 28, 2021	17,625,660	shares	As of February 29, 2020	17,625,660	shares
Number of treasury shares at the end of the period
	As of February 28, 2021	172,298	shares	As of February 29, 2020	72,998	shares
Average number of shares during the period
	Year ended February 28, 2021	17,488,363	shares	Year ended February 29, 2020	17,552,448	shares

(Note) The Company has established a BIP Trust. Shares of the Company held by the trust are included in treasury shares.

(References) Overview of non-consolidated financial results

1. Non-consolidated financial results for the year ended February 28, 2021 (from March 1, 2020 to February 28, 2021)

(1) Non-consolidated operating results

		Net sales		Operating profit	Ordinary profit	Profit
		Millions of yen	%	Millions of yen		%	Millions of yen		%	Millions of yen	%
Year ended February 28, 2021	1,878	(5.2)	835		6.4	924		4.8	696	(7.7)
Year ended February 29, 2020	1,980	(5.5)	785		(30.9)	882		(29.2)	754	55.8

		Earnings per share	Diluted earnings per share
			Yen			Yen
Year ended February 28, 2021		39.82			-
Year ended February 29, 2020		42.99			-
(2) Non-consolidated financial position
		Total assets	Net assets		Equity ratio		Net assets per share
		Millions of yen	Millions of yen			%		Yen
As of February 28, 2021			41,911			38,426			91.7	2,201.69
As of February 29, 2020			39,947			38,564			96.5	2,197.06
(Reference) Equity capital:	As of	February 28, 2021: ¥38,426	million
	As of February 29, 2020: ¥38,564 million

This financial summary document is outside the scope of audit conducted by certified public accountants or an audit corporation.
Explanation of appropriate use of forecasts of financial results, and other important items:
Financial forecasts and other forward-looking statements in this document are based on information available at the time of preparation and on certain assumptions that are deemed to be reasonable. These forward-looking statements are not guarantees of future performance and actual results may differ materially from these forecasts due to a variety of reasons.

Consolidated financial statements

(1) Consolidated balance sheets

			(Millions of Yen)
		As of February 29, 2020	As of February 28, 2021
Assets
Current assets
Cash and deposits	8,121	8,946
Notes and accounts receivable - trade	17,857	16,101
Merchandise and finished goods	3,626	1,975
Raw materials and supplies	981	901
Other	1,979	1,508
Allowance for doubtful accounts	(0)	(0)
Total current assets	32,566	29,433
Non-current assets
Property, plant and equipment
Buildings and structures	52,744	56,157
Accumulated depreciation	(32,313)	(33,304)
Buildings and structures, net	20,431	22,852
Machinery, equipment and vehicles	19,002	18,497
Accumulated depreciation	(15,159)	(15,080)
Machinery, equipment and vehicles, net	3,843	3,417
Land	12,231	11,890
Leased assets	13,851	13,308
Accumulated depreciation	(6,791)	(7,243)
Leased assets, net	7,059	6,064
Construction in progress	1,839	38
Other	1,530	1,513
Accumulated depreciation	(1,263)	(1,299)
Other, net	266	214
Total property, plant and equipment	45,673	44,477
Intangible assets
Goodwill	255	153
Leased assets	2	0
Other	678	522
Total intangible assets	936	677
Investments and other assets
Investment securities	473	512
Long-term loans receivable	12	182
Retirement benefit asset	667	800
Guarantee deposits	1,530	1,489
Deferred tax assets	3,452	3,425
Other	932	1,441
Allowance for doubtful accounts	(165)	(166)
Total investments and other assets	6,903	7,685
Total non-current assets	53,512	52,840
Total assets		86,078	82,273

			(Millions of Yen)
		As of February 29, 2020	As of February 28, 2021
Liabilities
Current liabilities
Notes and accounts payable - trade	10,304	9,195
Current portion of long-term borrowings	364	607
Lease obligations	2,433	2,159
Accounts payable - other	10,655	8,251
Income taxes payable	622	812
Provision for bonuses	1,331	1,252
Other	1,723	1,260
Total current liabilities	27,433	23,539
Non-current liabilities
Long-term borrowings	1,602	2,806
Lease obligations	6,936	5,640
Retirement benefit liability	3,768	4,148
Provision for share-based remuneration for directors (and	114	179
other officers)

Asset retirement obligations	1,574	1,411
Other	126	176
Total non-current liabilities	14,121	14,361
Total liabilities	41,555	37,900
Net assets
Shareholders' equity
Share capital	8,049	8,049
Capital surplus	8,100	8,100
Retained earnings	28,560	28,693
Treasury shares	(213)	(367)
Total shareholders' equity	44,496	44,475
Accumulated other comprehensive income
Valuation difference on available-for-sale securities	90	116
Deferred gains or losses on hedges	1	1
Foreign currency translation adjustment	(89)	(262)
Remeasurements of defined benefit plans	(156)	(166)
Total accumulated other comprehensive income	(154)	(311)
Non-controlling interests	181	208
Total net assets	44,523	44,372
Total liabilities and net assets		86,078	82,273

Consolidated statements of income and comprehensive income Consolidated statements of income

			(Millions of Yen)
		Fiscal year ended	Fiscal year ended
		February 29, 2020	February 28, 2021
Net sales	213,581	194,309
Cost of sales	181,097	162,994
Gross profit	32,483	31,314
Selling, general and administrative expenses
Transportation costs	12,526	11,784
Salaries, allowances and bonuses	6,586	6,378
Provision for bonuses	548	545
Depreciation	567	511
Rent expenses	1,174	1,176
Other	8,359	7,586
Total selling, general and administrative expenses	29,762	27,982
Operating profit	2,721	3,332
Non-operating income
Interest income	16	8
Dividend income	313	311
Rental income	164	176
Share of profit of entities accounted for using equity method	-	120
Other	69	162
Total non-operating income	563	780
Non-operating expenses
Interest expenses	109	98
Rental costs	130	129
Loss on retirement of non-current assets	116	55
Loss on sales of non-current assets	52	0
Loss on cancellation of leases	69	32
Other	32	84
Total non-operating expenses	510	401
Ordinary profit	2,773	3,710
Extraordinary income
Gain on sales of non-current assets	-	61
Total extraordinary income	-	61
Extraordinary losses
Impairment loss	882	1,673
Other	-	96
Total extraordinary losses	882	1,770
Profit before income taxes	1,891	2,001
Income taxes - current	878	1,166
Income taxes - deferred	(70)	74
Total income taxes	808	1,241
Profit	1,083	760
Profit attributable to non-controlling interests	72	77
Profit attributable to owners of parent		1,010	682

Consolidated statements of comprehensive income

		(Millions of Yen)
	Fiscal year ended	Fiscal year ended
	February 29, 2020	February 28, 2021
Profit	1,083	760
Other comprehensive income
Valuation difference on available-for-sale securities	(85)	25
Deferred gains or losses on hedges	1	(0)
Foreign currency translation adjustment	(52)	(280)
Remeasurements of defined benefit plans, net of tax	46	(10)
Share of other comprehensive income of entities accounted	-	12
for using equity method

Total other comprehensive income	(90)	(252)
Comprehensive income	992	508
(Comprehensive income attributable to)
Comprehensive income attributable to owners of parent	922	446
Comprehensive income attributable to non-controlling	70	61
interests

(3) Consolidated statements of changes in equity Fiscal year ended February 29, 2020

(Millions of Yen)

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

Balance at beginning of	8,049		8,100		28,254			(217)		44,186
period

Changes during period
Dividends of surplus			-		-		(704)		-		(704)
Profit attributable to owners			-		-		1,010			-		1,010
of parent

Purchase of treasury shares			-		-			-			(0)		(0)
Disposal of treasury shares			-		-			-			4		4
Net changes in items other			-		-			-			-		-
than shareholders' equity

Total changes during period			-		-		305			3		309
Balance at end of period	8,049		8,100		28,560			(213)		44,496

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

Balance at beginning of	175		(0)	(39)	(202)		(66)		121	44,242
period

Changes during period
Dividends of surplus	-			-		-	-			-		-	(704)
Profit attributable to owners	-			-		-	-			-		-	1,010
of parent

Purchase of treasury shares	-			-		-	-			-		-	(0)
Disposal of treasury shares	-			-		-	-			-		-	4
Net changes in items other	(85)		1	(50)	46		(87)		59	(28)
than shareholders' equity

Total changes during period	(85)		1	(50)	46		(87)		59	281
Balance at end of period	90		1	(89)	(156)		(154)		181	44,523

Fiscal year ended February 28, 2021

(Millions of Yen)

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

Balance at beginning of		8,049		8,100		28,560			(213)		44,496
period

Changes during period
Dividends of surplus				-		-		(704)		-		(704)
Profit attributable to owners				-		-		682			-		682
of parent

Change in scope of equity				-		-		154			-		154
method

Purchase of treasury shares				-		-			-			(153)		(153)
Net changes in items other				-		-			-			-		-
than shareholders' equity

Total changes during period				-		-		133			(153)		(20)
Balance at end of period		8,049		8,100		28,693			(367)		44,475

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

Balance at beginning of	90			1	(89)	(156)		(154)		181	44,523
period

Changes during period
Dividends of surplus	-				-		-	-			-		-	(704)
Profit attributable to owners	-				-		-	-			-		-	682
of parent

Change in scope of equity	-				-		-	-			-		-	154
method

Purchase of treasury shares	-				-		-	-			-		-	(153)
Net changes in items other	25			(0)	(172)	(10)		(157)		27	(129)
than shareholders' equity

Total changes during period	25			(0)	(172)	(10)		(157)		27	(150)
Balance at end of period	116			1	(262)	(166)		(311)		208	44,372

(4) Consolidated statements of cash flows

			(Millions of Yen)
		Fiscal year ended	Fiscal year ended
		February 29, 2020	February 28, 2021
Cash flows from operating activities
Profit before income taxes	1,891	2,001
Depreciation	5,802	4,812
Impairment loss	882	1,673
Increase (decrease) in allowance for doubtful accounts	162	1
Increase (decrease) in provision for bonuses	8	(78)
Increase (decrease) in retirement benefit liability	440	361
Interest and dividend income	(329)	(319)
Interest expenses	109	98
Share of loss (profit) of entities accounted for using	-	(120)
equity method

Loss (gain) on sales of property, plant and equipment	52	(61)
Loss on retirement of non-current assets	116	55
Decrease (increase) in trade receivables	(619)	1,738
Decrease (increase) in inventories	144	1,724
Increase (decrease) in trade payables	698	(1,092)
Increase (decrease) in accounts payable - other	2,071	(1,868)
Other, net	129	144
Subtotal	11,560	9,070
Interest and dividends received	329	319
Interest paid	(110)	(98)
Income taxes paid	(399)	(954)
Net cash provided by (used in) operating activities	11,379	8,338
Cash flows from investing activities
Purchase of property, plant and equipment	(2,871)	(5,234)
Proceeds from sales of property, plant and equipment	1,399	291
Purchase of intangible assets	(209)	(219)
Loan advances	(350)	(436)
Collection of loans receivable	332	332
Payments into time deposits	(775)	-
Proceeds from withdrawal of time deposits	1,166	207
Other, net	(40)	(166)
Net cash provided by (used in) investing activities	(1,349)	(5,226)
Cash flows from financing activities
Proceeds from long-term borrowings	-	2,034
Repayments of long-term borrowings	(1,122)	(545)
Repayments of lease obligations	(2,722)	(2,516)
Purchase of treasury shares	(0)	(153)
Dividends paid	(704)	(704)
Other, net	(6)	(36)
Net cash provided by (used in) financing activities	(4,556)	(1,922)
Effect of exchange rate change on cash and cash equivalents	(10)	(145)
Net increase (decrease) in cash and cash equivalents	5,462	1,043
Cash and cash equivalents at beginning of period	2,439	7,902
Cash and cash equivalents at end of period		7,902	8,946

(5) Segment information, etc.

[Segment information]

1. Overview of the reportable segments

The reporting segments of the Company and its consolidated subsidiaries are components for which separate financial information is available and whose operating results are regularly reviewed by the Board of Directors in order to determine the allocation of business resources to them as well as to evaluate their business performance. These segments are classified into "Food Products Business," "Food Ingredients Business," "Logistics Business," "Food Engineering Business" and "Temporary Staffing and Contracting Business" according to their products and services, and their main business operations are as follows.


Food Products Business:	Manufacturing and sales of cooked foods such as cooked rice products, bread products, side dishes
	and chilled Japanese sweets
Food Ingredients Business:	Procurement, processing and sales of food ingredients
Logistics Business:	Sorting and delivery of food products and ingredients
Food Engineering Business:	Sales of food processing machines, etc.
Temporary Staffing and Contracting Business:	Temporary staffing and contracting business

Calculation method for the amounts of sales, profits/losses, assets/liabilities, and other items by reporting segment The figures of profit (loss) of reporting segments are recorded on an operating profit basis.
Internal sales and transfers between segments are recorded based on actual market prices.
Information on the amounts of sales, profits/losses, assets/liabilities, and other items by reporting segment

Year ended February 29, 2020

								(Millions of Yen)
			Reportable segments				Carried on
								consolidated
	Food	Food		Food	Temporary		Adjustment
	Logistics		statements of
	Products	Ingredients	Engineering	Staffing and	Total	(Note 1)
	Business	Contracting		income
	Business	Business		Business	Business			(Note 2)
Net sales
Sales to external	175,503	16,283	14,000	1,910	5,882	213,581	-	213,581
customers

Intersegment sales	-	2,559	4,680	5,044	6,863	19,148	(19,148)	-
and transfers

Total	175,503	18,842	18,681	6,955	12,746	232,729	(19,148)	213,581

Segment profit (loss)	3,136	(216)	216	(149)	140	3,126	(405)	2,721

Segment assets	63,785	7,018	7,257	4,119	2,150	84,332	1,746	86,078

Other
Amortization of	92	-	-	-	-	92	-	92
goodwill

Depreciation	5,556	130	392	24	18	6,123	(320)	5,802
Increase in
property, plant and	4,138	20	203	43	61	4,467	(161)	4,305
equipment and

intangible assets

Notes: 1. The adjustment of (405) million yen under the item of "Segment profit (loss)" includes an elimination of intersegment transactions of 282 million yen, as well as corporate expenses of (688) million yen, which are not allocated to the reportable segments.

The adjustment of 1,746 million yen under the item of "Segment assets" includes an elimination of intersegment transactions of (23,734) million yen, as well as corporate assets of 25,481 million yen, which are not allocated to the reportable segments.

The adjustment of (320) million yen under the item of "Depreciation" includes an elimination of intersegment transactions of (322) million yen and depreciation of 1 million yen related to corporate assets, which are not allocated to the reportable segments.

The adjustment of (161) million yen under the item of "Increase in property, plant and equipment and intangible assets" includes an elimination of intersegment transactions of (170) million yen, as well as the increase in corporate assets of 8 million yen, which is not allocated to the reportable segments.

2. Segment profit (loss) is adjusted to reflect operating profit as recorded on the consolidated statements of income.

Year ended February 28, 2021

								(Millions of Yen)
			Reportable segments				Carried on
								consolidated
	Food	Food		Food	Temporary		Adjustment
	Logistics		statements of
	Products	Ingredients	Engineering	Staffing and	Total	(Note 1)
	Business	Contracting		income
	Business	Business		Business	Business			(Note 2)
Net sales
Sales to external	160,417	14,994	13,121	1,473	4,303	194,309	-	194,309
customers

Intersegment sales	-	2,451	4,828	1,902	5,299	14,480	(14,480)	-
and transfers

Total	160,417	17,445	17,949	3,375	9,603	208,790	(14,480)	194,309

Segment profit (loss)	4,261	(757)	447	(12)	(277)	3,662	(330)	3,332

Segment assets	62,970	4,575	6,839	1,389	1,356	77,131	5,142	82,273

Other
Amortization of	87	-	-	-	-	87	-	87
goodwill

Depreciation	4,602	110	411	2	27	5,154	(341)	4,812
Investments to
entities accounted	1,092	-	-	-	-	1,092	-	1,092
for using equity

method
Increase in
property, plant and	5,441	104	94	-	55	5,696	(73)	5,623
equipment and

intangible assets

Notes: 1. The adjustment of (330) million yen under the item of "Segment profit (loss)" includes an elimination of intersegment transactions of 372 million yen, as well as corporate expenses of (702) million yen, which are not allocated to the reportable segments.

The adjustment of 5,142 million yen under the item of "Segment assets" includes an elimination of intersegment transactions of (22,533) million yen, as well as corporate assets of 27,675 million yen, which are not allocated to the reportable segments.

The adjustment of (341) million yen under the item of "Depreciation" includes an elimination of intersegment transactions of (343) million yen and depreciation of 1 million yen related to corporate assets, which are not allocated to the reportable segments.

The adjustment of (73) million yen under the item of "Increase in property, plant and equipment and intangible assets" includes an elimination of intersegment transactions of (73) million yen.

Segment profit (loss) is adjusted to reflect operating profit as recorded on the consolidated statements of income.
A part of businesses operated by Nichiyo Fresh Co., Ltd. was included in the Food Products Business due to changes in commercial distribution during the fiscal year ended February 28, 2021.