BML : Consolidated Earnings Report for the Second Quarter of Fiscal 2021

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Disclaimer: This is a Japanese-English translation of the summary of financial statements of the Company produced for your convenience. Since no auditor audited this report, officially only the Japanese version is assumed to be the summary of financial statements of the Company. This summary does not constitute any guarantee and the Company will not compensate any losses and/or damage stemming from actions taken based on these statements. Should there be any discrepancy between the Japanese and English versions, the Japanese version is assumed to be correct.

November 11, 2021

CONSOLIDATED EARNINGS REPORT

FOR THE SECOND QUARTER OF FISCAL 2021

[Japanese GAAP]

Company Name:	BML, Inc.
Stock Listing:	Tokyo Stock Exchange
Stock Code:	4694
URL:	http://www.bml.co.jp
Representative:	Kensuke Kondo, President and Representative Director
Contact:	Norihisa Takebe, Managing Executive Officer
	Tel: [phone]

Scheduled Date for Filing of Quarterly Report:	November 12, 2021
Scheduled Date for Payment of Dividends:	December 2, 2021
Creation of Supplementary Explanatory Materials:	Yes
Holding of Explanatory Meeting:	Yes
	(Rounded down to nearest million yen)

1. Results for the Second Quarter of Fiscal 2021 (April 1, 2021-September 30, 2021)

(1) Consolidated Business Results

(% indicates year-on-year changes)

Net sales Operating income Ordinary income Profit attributable to owners of parent

	¥ million	%	¥ million		%	¥ million	%	¥ million	%
2Q of FY2021	95,700	60.0	27,525		453.4	28,433	439.0	18,761	433.8
2Q of FY2020	59,828	(3.4)	4,973		(19.7)	5,275	(17.8)	3,514	(13.7)
(Note) Comprehensive income: 2Q	of FY2021 ¥19,170 million / 555.9% 2Q of FY2020 ¥3,448 million / (20.7)%
	Profit attributable to			Profit attributable to
	owners of parent per share		owners of parent per share (diluted)
			Yen					Yen
2Q of FY2021			461.53					461.16
2Q of FY2020			86.52					86.42

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(2) Consolidated Financial Position

Total assets

Net assets

Equity ratio

(¥ million)

(¥ million)

(%)

As of September 30, 2021

162,430

110,144

64.7

As of March 31, 2021

139,174

93,123

63.5

Reference: Equity capital: As of

September 30, 2021 ¥105,115 million As of March 31, 2021

¥88,377 million

2. Dividends

Dividends per share

First

Second

Third

Year-end

Full year

quarter-end

quarter-end

quarter-end

Yen

Yen

Yen

Yen

Yen

Fiscal 2020

―

20.00

―

50.00

70.00

Fiscal 2021

―

35.00

Fiscal 2021

―

35.00

70.00

(forecast)

(Note) Revision of dividend projection from recently announced figures: None

3. Consolidated cumulative earnings forecast for the fiscal year ending March 31, 2022 (April 1, 2021-March 31, 2022)

(% indicates year-on-year changes)

									Profit
							Profit		attributable to
	Net Sales	Operating income	Ordinary income	attributable to	owners of
							owners of parent	parent per
									share
	¥ million	%	¥ million	%	¥ million	%	¥ million	%	Yen
Full year	154,000	11.1	32,000	60.5	33,100	59.1	20,900	52.4	514.07
(Note) Revision from recently projected results: None

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• Notes
  (1) Changes in significant subsidiaries during the period (changes in specified subsidiaries due to

changes in the scope of consolidation): None

Increases: -

Decreases: -

1. Adoption of specific accounting methods in preparing quarterly financial statements: None
2. Changes in accounting policies, accounting estimates and restatements

1. Changes in accounting policies in conjunction with revisions to accounting standards: Yes
2. Other changes: None
3. Changes in accounting estimates: None
4. Restatements: None

1. Number of outstanding stocks (common stock)
   a. Number of outstanding stocks at the end of the fiscal year (treasury shares included)

	As of September 30, 2021	44,014,726	As of March 31, 2021	44,014,726
b. Number of treasury shares at the end of period
	As of September 30, 2021		3,353,302	As of March 31, 2021	3,367,662
c. Average number of shares during the period
	2Q ended September 30, 2021		40,651,934	2Q ended September 30, 2020	40,627,973

• The quarterly financial results are not subject to quarterly review by a certified public accountant or an audit firm.
• Disclaimer regarding appropriate use of forecasts and related points of note
  Earnings forecasts contained in these materials are based on certain assumptions judged to be reasonable and on the information available when the forecasts were made. However, the Company makes no guarantee that these forecasts will be achieved. Actual results may differ significantly from the forecasts due to a variety of factors. Please refer to "(3) Consolidated earnings forecasts and others" under "1. Qualitative information on operating results for quarter under review" on page 5 of this earnings report concerning financial forecasts such as the assumptions used for financial forecasts, factors that could cause these assumptions to change, and cautionary notes.

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1. Qualitative information on operating results for quarter under review

1. Operating results

In the first six months of the consolidated fiscal year under review, the COVID-19 vaccine rollout picked up steam, economic activity resumed gradually, and some sectors showed evidence of recovery; however, the future of the Japanese economy remained unclear amid factors such as reduced consumer spending and limited corporate activities.

Under these circumstances, the contract clinical testing business was confronted with a lackluster trend in the number of patients due to the spread of COVID-19 but also saw an expanding market amid growth in demand for novel coronavirus-related testing. Still, the business environment remained challenging as competition with peer companies continued.

Under these conditions, net sales for the second quarter of the fiscal year under review were ¥95,700 million, an increase of 60.0% year on year, and operating income was ¥27,525 million, an increase of 453.4% year on year. Ordinary income increased 439.0% year on year to ¥28,433 million, and profit attributable to owners of parent increased 433.8% to ¥18,761 million.

Conditions by business segment are described below.

In the clinical testing business, the BML Group made efforts in new customer acquisition, and sought to enhance business performance by implementing marketing activities to further cultivate sales of new testing items, unique testing items, priority testing items, and others. With a solid trend in coronavirus-related testing, net sales in the clinical testing business increased by 64.2% year on year. Notably, regarding testing for the novel coronavirus, the Group was contracted for the first time to conduct genomic analysis and pooled PCR testing of five specimens at a time. The Group will continue to reinforce its testing system in order to be able to continue responding to various changes in the situation.

In the food hygiene business, the continued impact of the COVID-19 pandemic, such as customers voluntarily restricting their operations, led to a severe situation notably in the areas of food consulting and norovirus testing. Nonetheless, with some signs of a rebound from previous-year levels, net sales increased by 13.2% year on year.

As a result of the above, net sales in the testing business overall increased 62.6% year on year.

In the medical informatics business, despite restrictions on sales activities targeting new clients, sales improved 6.3% year on year thanks to an increase in the number of requests for online certification checks and solid maintenance sales attributable to the greater number of facilities at which systems are installed. With respect to the cloud-based electronic patient chart system, release is scheduled for April 2022.

In other businesses, the dispensing pharmacy business was affected by a revision of medical service fees (reduction in drug prices), but net sales recorded an increase of 4.9% year on year reflecting a rebound in the number of outpatient visits from last year's decline caused by the spread of COVID-19.

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(2) Financial position

(a) Assets, liabilities and net assets

At the end of the second quarter of the consolidated fiscal period under review, total assets amounted to ¥162,430 million, a ¥23,255 million increase over the end of the previous fiscal year. Net assets totaled ¥110,144 million, up ¥17,020 million over the end of the previous fiscal year, and the equity ratio was 64.7%, a 1.2% increase over the end of the previous fiscal year.

Regarding the main items contributing to increases or decreases, in the assets section, under current assets, cash and deposits increased ¥14,788 million and notes and accounts receivable-trade increased ¥6,225 million. In the liabilities section, under current liabilities, notes and accounts payable-trade increased ¥835 million and income taxes payable increased ¥3,726 million. In the net assets section, retained earnings increased ¥16,729 million.

(b) Cash flows

Cash and cash equivalents on September 30, 2021, increased ¥26,778 million from September 30, 2020, to ¥74,537 million. The cash flow position and factors behind changes for each type of activity are as follows.

Operating activities provided net cash of ¥21,461 million, ¥18,280 million more than in the same period a year earlier. This was primarily due to an increase of ¥22,883 million in profit before income taxes, and an increase in cash outflow resulting from a ¥2,731 million increase in decrease (increase) in trade receivables.

Investing activities used net cash of ¥3,949 million, ¥ 2,045 million more than in the same period a year earlier. This was largely a result of an increase of ¥1,509 million in purchase of property, plant and equipment and an increase of ¥359 million in payments into time deposits.

Financing activities used net cash of ¥2,857 million, ¥1,091 million more than in the same period a year earlier. This was primarily due to an increase of ¥ 1,016 million in dividends paid.

(3) Consolidated earnings forecast and others

Consolidated full-year forecasts for the year ending March 31, 2022 are unchanged from the figures announced on August 11, 2021.

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