Daido Steel : Consolidated Financial Results for the Fiscal Year Ended March 31, 2021

Consolidated Financial Results

for the Fiscal Year Ended March 31, 2021

[Japanese GAAP]

April 30, 2021

Company name: Daido Steel Co., Ltd.

Stock exchange listing: Tokyo Stock Exchange, Nagoya Stock Exchange

Code number: 5471

URL: https://www.daido.co.jp/

Representative: Takeshi Ishiguro, President and Representative Executive Director

Contact: Hideo Suzuki, General Manager, General Affairs Department

Phone: [phone]

Scheduled date of ordinary general shareholders' meeting: June 24, 2021

Scheduled date of filing annual securities report: June 24, 2021

Scheduled date of commencing dividend payments: June 25, 2021

Availability of supplementary briefing material on annual financial results: Available

Schedule of annual financial results briefing session: Scheduled (for securities analysts and institutional investors)

(Amounts of less than one million yen are rounded down.)

1. Consolidated Financial Results for the Fiscal Year Ended March 31, 2021 (April 1, 2020 to March 31, 2021)

(1) Consolidated Operating Results					(% indicates changes from the previous corresponding period.)
	Net sales		Operating income		Ordinary income			Profit attributable to
						owners of parent
	Million yen			%	Million yen	%		Million yen		%				Million yen	%
March 31, 2021	412,722	(15.8)	10,070	(59.3)		12,642		(48.0)			4,516	(58.9)
March 31, 2020	490,421	(9.7)	24,768	(26.8)		24,298		(29.2)			10,987	(48.1)
(Note) Comprehensive income: Year ended March 31, 2021: ¥32,439 million [－% ]
	Year ended March 31, 2020: (¥8,886) million [－% ]
	Profit attributable to		Diluted profit					Ordinary income
		attributable to						Operating income
	owners of parent		Return on equity
		owners of parent		to total assets			to net sales
	per share
				per share
		Yen			Yen			%							%		%
March 31, 2021	105.96			－			1.6						2.0		2.4
March 31, 2020	257.76			－			3.9						3.8		5.1
(Reference) Equity	in earnings (losses) of affiliates: Year ended March 31, 2021: (¥189) million
					Year ended March 31, 2020: ¥760 million
(2) Consolidated Financial Position
	Total assets		Net assets		Shareholders'			Net assets per share
			equity ratio
		Million yen		Million yen						%					Yen
March 31, 2021		665,506		339,353						45.6					7,111.48
March 31, 2020		625,899		309,136						43.7					6,417.37
(Reference) Shareholders' equity: As of March 31, 2021 : ¥303,143 million
	As of March 31, 2020 : ¥273,561million
(3) Consolidated Cash Flows
	Net cash provided		Net cash provided		Net cash provided				Cash and cash
	by (used in)		by (used in)		by (used in) financing		equivalents at the end
	operating activities		investing activities		activities					of the period
		Million yen		Million yen					Million yen					Million yen
March 31, 2021		33,766		(29,395)						2,999					65,558
March 31, 2020		41,033		(39,326)						10,526					57,843

2. Dividends

		Annual dividends		Total	Payout ratio	Dividends to
	1st	2nd	3rd	Year-end	Total	dividends	(consolidated)	net assets
	(consolidated)
	quarter-end	quarter-end	quarter-end
	Yen	Yen	Yen	Yen	Yen	Million yen	%	%
March 31, 2020	－	55.00	－	15.00	70.00	2,984	27.2	1.1
March 31, 2021	－	10.00	－	25.00	35.00	1,492	33.0	0.5
Fiscal year ending
March 31, 2022	－	75.00	－	75.00	150.00		27.2
(Forecast)

3. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2022 (April 1, 2021 to March 31, 2022)

(% indicates changes from the previous corresponding period.)

	Net sales		Operating income	Ordinary income	Profit attributable to	Profit attributable to
		owners of parent	owners of parent
								per share
	Million yen		%	Million yen	%	Million yen	%	Million yen	%	Yen
First half	255,000		42.1	18,000	－	18,500	－	11,500	－	269.78
Full year	500,000		21.1	35,000	247.6	36,000	184.8	23,500	420.3	551.29

• Notes:
• 1. Changes in significant subsidiaries during the period under review (changes in specified subsidiaries resulting in changes in scope of consolidation): No
  2. Changes in accounting policies, changes in accounting estimates and retrospective restatement
  3. 1. Changes in accounting policies due to the revision of accounting standards: No
     2. Changes in accounting policies other than 1) above: No
     3. Changes in accounting estimates: No
     4. Retrospective restatement: No
  4. Total number of issued shares (common shares)
  5. 1. Total number of issued shares at the end of the period (including treasury shares):

March 31, 2021	43,448,769 shares
March 31, 2020	43,448,769 shares
2) Total number of treasury shares at the end of the period:
March 31, 2021	821,449 shares
March 31, 2020	820,446 shares
3) Average number of shares during the period:
Fiscal year ended March 31, 2021	42,627,902 shares
Fiscal year ended March 31, 2020	42,628,998 shares

(Reference) Summary of Non-consolidated Financial Results

Non-consolidated Financial Results for the Fiscal Year Ended March 31, 2021 (April 1, 2020 to March 31, 2021)

(1) Non-consolidated Operating Results		(% indicates changes from the previous corresponding period.)
	Net sales		Operating income	Ordinary income	Net income
	Million yen		%	Million yen	%	Million yen		%	Million yen	%
March 31, 2021	245,504		(19.5)	5,073	(69.8)	9,001		(57.2)	6,335	(44.8)
March 31, 2020	304,819		(10.6)	16,792	(12.3)	21,049		(13.7)	11,483	(27.8)
	Net income	Diluted net income
	per share		per share
			Yen		Yen
March 31, 2021			148.58		－
March 31, 2020			269.31		－
(2) Non-consolidated Financial Position
	Total assets	Net assets	Shareholders'		Net assets per share
	equity ratio
		Million yen		Million yen			%		Yen
March 31, 2021			472,864		215,387			45.5		5,051.36
March 31, 2020			434,175		189,484			43.6		4,443.78

(Reference) Shareholders' equity: As of March 31, 2021 : ¥215,387million As of March 31, 2020 : ¥189,484million

• These financial results are outside the scope of audit process procedures by a certified public accountant or an audit firm
• Explanation of the proper use of financial results forecast and other notes

The earnings forecasts and other forward-looking statements herein are based on information available to the Company and certain assumptions deemed reasonable as of the date of publication of this document. Actual results may differ significantly from these forecasts due to a wide range of factors.

Supplementary briefing material

April 30, 2021

Daido Steel Co., Ltd.

Consolidated Financial Results for the Fiscal Year Ended March 31, 2021

(1) Net sales and operating income by reportable segment		(2) Condensed statement of profit and loss (cumulative)
				(Millions of yen, %)			(Millions of yen, %)
		Net sales	Operating income			Fiscal year	YoY
		Fiscal		Fiscal				ended	Change
		YoY				March 31,	[% of
		year	year	YoY			2021	Change]
		Change
		ended	ended
		[% of	Change				(77,698)
		March 31,	March 31,		Net sales	412,722
		Change]			[(15.8%)]
		2021		2021
									(14,698)
Specialty Steel	145,842	(35,831)	(2,632)	(7,780)		Operating income	10,070
[(19.7%)]		[(59.3%)]
							Non-operating income
High Performance		(17,936)			2,572	3,042
				and expenses
Materials and	149,420		12,172	(1,465)			(11,656)
[(10.7%)]
Magnetic Materials					Ordinary income	12,642
							[(48.0%)]
Parts for		(16,593)
				Extraordinary income
Automobile and	80,750	[(17.0%)]	(2,109)	(2,540)		(2,576)	551
Industrial Equipment					and losses
							Income before income	10,065	(11,104)
			(6,378)
Engineering	20,205	858	(2,101)		taxes
[(24.0%)]
	Income taxes	4,097	(4,997)
Trading and	16,504	(959)	1,786	(794)		Profit attributable to	1,451	364
Service	[(5.5%)]		non-controlling interests
					(6,471)
							Profit attributable to
Adjustment	－	－	(4)	(14)	4,516
	owners of parent	[(58.9%)]
Total	412,722	(77,698)	10,070	(14,698)
[(15.8%)]

(Sales volume of Specialty Steel 978 thou. tons, decreasing 198 thou. tons vs FY2019)

(3) Reasons for change in the amount of ordinary income (YoY comparison)

				(100 millions of yen)		(Reference: Market condition)
Reasons for	Amount			Reasons for		Amount						Fiscal year		Fiscal year
increase			decrease								ended		ended
														March 31,		March31,
1. Raw material	120		1. Sales volume		162
and fuel cost								2020		2021
2. Fixed cost	79		2. Sales price		107			H2			20.6		24.9
3. Variable cost	2		3. Sales mix		79			(Thousands of yen/t)
		change
4. Non-operating	30								Nickel (LME)			6.3		6.8
income or loss										(One dollar/lb)
											Exchange rate (TTM)
Total (a)	231			Total (b)		348		109.7		107.1
											(yen/dollar)
(4) Condensed balance sheet		Change (a) - (b)		(117)
													(Millions of yen)
	As of		As of								As of		As of
Item	March 31,		March 31,		Change				Item	March 31,		March31,	Change
	2020			2021								2020			2021
Current assets	310,641		319,364		8,722		Liabilities	316,763		326,152	9,389
Cash and deposits	59,558		67,314		7,756			Trade payables	66,821		65,589	(1,232)
Trade receivables	118,281		125,918		7,636			Interest-bearing debt	193,881		198,812	4,931
Inventories	127,174		118,532		(8,641)			Other	56,060		61,750	5,690
Other	5,627		7,599		1,971
Non-current assets	315,257		346,142		30,884		Net assets	309,136		339,353	30,217
Property, plant and	237,492		231,846		(5,646)			Shareholders' equity	276,101		280,297	4,195
equipment
									Accumulated other
Intangible assets	1,619		2,721		1,101			comprehensive	(2,539)		22,846	25,386
										income
Investments and	76,145		111,574		35,429			Non-controlling	35,574		36,210	636
other assets					interests
Total assets	625,899		665,506		39,607			Total liabilities	625,899		665,506	39,607
				and net assets

(5) Net sales and operating income forecast by reportable segment		(6) Financial results forecast
			(Millions of yen, %)				(Millions of yen, %)
	Net sales	Operating income				Forecast	YoY change
	Forecast		Forecast					for fiscal
						year ending	[% of
	for fiscal	YoY	for fiscal
	YoY				March 31,	Change]
	year	Change	year
				2022
	ending	[% of	ending	Change
					87,277
	March 31,	Change]	March 31,			Net sales		500,000
				[21.1%]
	2022		2022
									24,929
Specialty Steel	182,000	36,157	4,000	6,632		Operating income		35,000
[24.8%]			[247.6%]
									23,357
High Performance	182,000	32,579	23,000	10,827		Ordinary income		36,000
Materials and	[21.8%]					[184.8%]
Magnetic Materials					Profit attributable to		23,500	18,983
Parts for	97,000	16,249	5,500	7,609		owners of parent		[420.3%]
Automobile and	[20.1%]
Industrial Equipment
Engineering	21,000	794	0	(858)
[3.9%]
Trading and	18,000	1,495	2,500	713
Service	[9.1%]
Adjustment	－	－	－	4
Total	500,000	87,277	35,000	24,929
[21.1%]

(Sales volume of Specialty Steel 1,255 thou. tons, increasing 277 thou. tons vs FY2020)

(7) Forecasted reasons for change in the amount of ordinary income (YoY comparison)

		(100 millions of yen) (Reference: Market condition)
Reasons for	Amount	Reasons for	Amount				Fiscal year	Forecast
increase	decrease				for fiscal
							ended	year
1. Sales volume	253	1. Raw material	264
and fuel cost				March 31,	ending
2. Sales price	162	2. Fixed cost	51				2021	March 31,
				2022
3. Sales mix change	91	3. Non-operating	15
	H2
income or loss			24.9	38.0
4. Variable cost	49				(Thousands of yen/t)
5. Change of	9				Nickel (LME)		6.8	8.5
financial periods				(One dollar/lb)
Total (a)	564	Total (b)	330
	Exchange rate (TTM)		107.1	105.0
		Change (a) - (b)	234		(yen/dollar)

1. Amount of capital expenditures (based on completion of construction) and depreciation and amortization (Millions of yen)

		Fiscal year		Fiscal year				Forecast for
		ended		ended				fiscal year
		March 31,		March 31,		Change	ending March		Change
	2020		2021		31, 2022
Capital expenditures	37,529		24,448		(13,081)	20,000		(4,448)
Depreciation and	24,662		25,912		1,249	26,700		787
amortization
(Reference) Historical Financial Results									(Millions of yen)
							Actual results			Forecast for fiscal
		Fiscal year	Fiscal year		Fiscal year	Fiscal year
		ended		ended		ended	ended	year ending March
		March 31,	March 31,		March 31,	March 31,	31, 2022
		2018			2019		2020		2021
Net sales			505,219		543,255		490,421	412,722	500,000
Operating income			36,218		33,815		24,768	10,070	35,000
Ordinary income			36,130		34,343		24,298	12,642	36,000
Profit attributable to			23,920		21,182		10,987	4,516	23,500
owners of parent