Kokuyo : Summary of Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2022 （2,071KB）

Summary of Financial Results for the Second Quarter of the Fiscal Year

Ending December 31, 2022

August 2, 2022

KOKUYO Co., Ltd.

© 2022 KOKUYO Co., Ltd.

Contents

• 1. Second Quarter FY2022 Results
  2. Full-YearFY2022 Forecasts
  3. Update on Third Medium-Term Plan (2022-2024): Field Expansion 2024
  4. Reference Materials
• The business segments are as follows:

Furniture Businesses: FN

Business Supply Distribution: BS

Stationery Businesses: ST

Interior Retail Businesses: IR

• Unless otherwise indicated, monetary figures are rounded down to the nearest hundred million yen. As such, the sum of the figures in a breakdown may not match the stated total.

Executive Summary

Second Quarter FY2022 Results

• Earnings decreased year on year and fell short of forecast. The main reasons were a decline in new office orders in FN, raw materials costs that exceeded expectations, and the
  Shanghai lockdown's impact on the Chinese ST.
• In FN, we tried to compensate by focusing on office renovations. Although we gained many leads, we converted fewer than we had initially expected.
• Profitability was undercut by the increase in raw material costs in Japan and India. We revised prices from the start of the year to make allowance for the impact, but the increase exceeded expectations.
• Exchange rates proved highly volatile, but we largely negated the impact by using currency forward contracts.
• Net income increased year on year and exceeded forecast. Factors: 1) a bounce-backfrom the recording, in the previous fiscal year, of ¥5.0 billion following impairment in equity-methodaffiliate Pentel Co., Ltd., 2) an upswing in non-operatingincome thanks to foreign exchange gains amid the weak yen, 3) an upswing in extraordinary income with a before-scheduledsale of shares held under a cross-holdingarrangement.
• FY2022 being year 1 of the 3rd medium-term plan, we made headway in expanding the fields by redistributing resources from existing businesses and actively allocating strategic expenditures.

Full-Year FY2022 Forecasts

• We should make up the shortfall in H2 by securing orders for office renovations in FN, among other things. Based on this outlook, we're not revising the full-yearforecasts for net sales and operating income.
• We'll upgrade the forecast for ordinary income and net income in view of foreign exchange gains.
• Dividend forecasts (28 yen interim, 28 yen year-end): Aiming for a payout ratio of 40%, we'll upgrade the year-enddividend by 1 yen to 29 yen.

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© 2022 KOKUYO Co., Ltd.

1. Second Quarter FY2022 Results

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Second Quarter FY2022 Results: Year on Year Comparisons

Net sales increased year on year. Although operating income decreased,

profit increased.

					(Billions of yen)
	Jan-Jun	Jan-Jun	Jan-Jun
		Divergence
	2021	2022	2022
	result	forecast	result	YoY change	from
					forecast
Net sales	155.2	160.7	156.4	+1.1	-4.2
Gross profit	61.9	64.3	61.2	-0.7	-3.0
(ratio)	39.9%	40.0%	39.1%	-0.7pt	-0.9pt
SG&A expenses	47.2	50.2	48.4	+1.2	-1.7
(ratio)	30.4%	31.2%	31.0%	+0.6pt	-0.2pt
Operating income	14.6	14.1	12.7	-1.9	-1.3
(ratio)	9.4%	8.8%	8.1%	-1.3pt	-0.6pt
Ordinary income	10.4	14.7	14.6	+4.1	-0
(ratio)	6.7%	9.1%	9.3%	+2.6pt	+0.2pt
Profit	8.3	10.5	10.8	+2.5	+0.3
(ratio)	5.4%	6.5%	6.9%	+1.6pt	+0.4pt

* The new revenue standard has been retroactively applied to the results for FY2021.

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© 2022 KOKUYO Co., Ltd.