Kanematsu : Supplementary Material of Consolidated Financial Results for the First Nine Months of Fiscal Year Ending March 31, 2023 (IFRS)

Supplementary Material of Consolidated

Financial Results for the First Nine Months of Fiscal Year Ending March 31, 2023 (IFRS)

Note on forward-looking statements:

The forward-looking statements, including results forecasts, included in this material are based on information that the Company has obtained and certain assumptions that the Company considers reasonable. The Company does not promise to achieve them. Actual results may differ materially from forecasts due to a number of factors.

This information is subject to change without notice and users are, therefore, advised to use this information and material, together with information obtained by other means, and to exercise their own judgment.

The Company does not assume any liability or responsibility for any loss or damage arising from use of this material.

Since the figures shown are rounded off to the nearest 1 billion yen, the sum of each item and the total may differ.

© KANEMATSU CORPORATION ALL RIGHTS RESERVED.

＜サマリー＞

■Revenue and profits both increased year on year.
◇Revenue	677.7	billion yen	20.8％ up
◇Operating profit	29.6	billion yen	40.5％ up
◇Profit before tax	28.4	billion yen	38.4％ up
◇Profit attributable to owners of the parent	15.5	billion yen	29.2％ up

■Full-year forecasts have been revised upward (Operating profit: 37.0 billion yen → 38.0 billion yen, Profit before tax: 35.5 billion yen → 36.0 billion yen), while maintaining the forecast for profit attributable to owners of the parent given factors such as gains/losses on non-controlling equities.

1. Profit & loss statement

(Unit：billion yen)		3Q of	3Q of	Year-on-year		FY 2023
	FY 2022	FY 2023	Change	Change(%)		Forecast	Progress(%)

	Revenue		560.9	677.7	116.8	20.8%		870.0	77.9%	【Revenue】
	Gross profit		81.5	92.9	11.4	13.9%	-	-		Increased year on year in all segments with a total revenue
	Selling, general and administrative expenses		( 62.7)	( 69.4)	( 6.7)	-		-	-		increase of 116.8 billion yen.。
	Other income (expenses)	2.3	6.2	3.9	170.0%	-	-
	Operating profit		21.1	29.6	8.5	40.5%		38.0	78.0%	【Operating profit】
		Interest income (expenses)	( 1.1)	( 2.4)	( 1.3)	-	-	-		Grew 8.5 billion yen driven by the Steel, Materials &
												Plant segment and the Electronics & Devices segment.
		Dividend income		0.7	0.9	0.2	-		-	-
		Other finance income (costs)		( 1.5)	0.3	1.9	-		-	-
	Finance income (costs)	( 1.9)	( 1.2)	0.8	-	-	-		Profit before tax
									【	】
	Share of profit (loss) of investments accounted for	1.4	( 0.1)	( 1.4)	-	-	-		Increased 7.9 billion yen mainly due to a rise in operating
	using the equity method
	Profit before tax		20.5	28.4	7.9	38.4%		36.0	78.9%		profit.
	Income tax expense		( 5.7)	( 8.9)	( 3.2)	-		-	-
	Profit for the period	14.9	19.5	4.7	31.5%	-	-	【Profit attributable to owners of the parent】
	Profit attributable to owners of the parent		12.0	15.5	3.5	29.2%		19.0	81.7%		Increased 3.5 billion yen associated with a rise in profit
												before tax.
	Earnings per share (yen)		143.84	185.84	42.00	29.2%		227.48	81.7%

© KANEMATSU CORPORATION ALL RIGHTS RESERVED.

2. Segment information

				Revenue				Operating profit			Profit attributable to owners of the parent
	(Unit: billion yen)		3Q of	3Q of	Change	FY2023	3Q of	3Q of	Change		FY2023	3Q of	3Q of	Change	FY2023
			FY 2022	FY 2023	Forecast	Progress	FY 2022	FY 2023		Forecast	Progress	FY 2022	FY 2023	Forecast	Progress
	Electronics & Devices		179.8	203.4	23.5	285.0	71%	11.4	13.4	2.0		20.0	67%	4.3	5.6	1.4	9.0	63%
	Foods, Meat & Grain	215.2	257.8	42.6	310.0	83%	4.3	5.5	1.1		5.5	99%	3.1	3.6	0.5	3.3	110%
	Steel, Materials & Plant	104.8	142.5	37.8	180.0	79%	3.1	9.2	6.1		10.8	86%	3.0	5.3	2.3	5.7	93%
	Motor Vehicles & Aerospace	51.1	63.2	12.0	80.0	79%	1.3	0.8	( 0.5)		1.0	80%	1.0	0.6	( 0.4)	1.0	64%
Total for reportable segments		551.0	666.9	115.9	855.0	78%	20.2	28.9	8.7		37.3	78%	11.4	15.2	3.8	19.0	80%
Other (including adjustment)		9.9	10.9	0.9	15.0	72%	0.9	0.7	( 0.2)		0.7	106%	0.6	0.3	( 0.3)	-	-
Grand total	560.9	677.7	116.8	870.0	78%	21.1	29.6	8.5		38.0	78%	12.0	15.5	3.5	19.0	82%

（Billion yen）	（Billion yen）	（Billion yen）

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3. Operating profit ＜Segment＞

35.0 （Billion yen）

30.0

25.0					13.4
20.0
				2.0
15.0			11.4		5.5
10.0			4.3	1.1	9.2
5.0		3.1		6.1
	1.3
0.0	0.9	( 0.5)	0.8	0.7
		3 Q O F		3 Q O F
			F Y 2 0 2 2		F Y 2 0 2 3
			21.1 billion yen		29.6 billion yen

Causes of year-on-year increase/decrease

【Electronics & Devices】

2.0 billion yen up

The ICT solutions business performed strongly, mainly due to an increase in projects related to security and network and improvements to delivery delays. The semiconductor parts and manufacturing equipment business performed well due to growth in shipments of manufacturing equipment and consumables related to semiconductors and LCD panels supported by the robust demand. The mobile business was weak due to a stagnant sales volume and smaller fee income resulting from revisions to fee terms and conditions.

【Foods, Meat & Grain】

1.1 billion yen up

The grain and feedstuff business was strong partly due to the improved profitability. The foods business performed well thanks to the growth in transactions of products for the retail market. The meat products business was weak due to the market setbacks for meat products in general since summer.

【Steel, Materials & Plant】

6.1 billion yen up

The energy business was strong mainly on the back of heavy oil sales for power generation and fuel sales for ocean-going vessels. The steel tubing business performed well thanks to the growth in energy investments in the U.S. and the rising steel tube prices. The machine tools and industrial machinery business was solid supported by the growing demand for capital investments in Japan.

【Motor Vehicles & Aerospace】 0.5 billion yen down

The aerospace business was solid with the delivery of products for the contracts already signed and a recovery in demand. The motor vehicles and parts business, however, was weak as the rising transportation costs placed a pressure on profits, while demand was in a recovery trend.

© KANEMATSU CORPORATION ALL RIGHTS RESERVED.

4. Cash Flows and Financial Status

		(Unit: billion yen)		3Q of	3Q of	Change		【CF from operating activities】
			FY 2022	FY 2023		Net cash used by operating activities was 12.5 billion yen, mainly reflecting an increase in
								operating funds such as inventories, while cash was provided by the accumulation of operating
	CF from operating activities		9.1	( 12.5)	( 21.5)
			revenue.
	CF from investing activities		( 10.3)	( 14.2)	( 3.8)		【CF from investing activities】
	Free cash flows		( 1.3)	( 26.6)	( 25.3)		Net cash used in investing activities was 14.2 billion yen, due to business investments including
			the acquisition of subsidiaries.
	CF from financing activities		7.9	11.3	3.4
	（Note: The amount of impact associated with the application of IFRS 16 Leases）			【CF from financing activities】
								Net cash provided by financing activities was 11.3 billion yen mainly due to an increase in short-
		CF from operating activities		6.2	6.5	0.4
				term borrowings, while there were expenditures such as the payment of cash dividends and
				( 6.2)	( 6.5)	( 0.4)
		CF from financing activities			redemption of corporate bonds.
		(Unit: billion yen)		End of March 31,	End of December	Change		【Total assets】
			2022	31, 2022
	Total assets		634.5	680.5	46.0		Increased 46.0 billion yen, mainly due to increases in trade and other accounts receivable and
								inventories.
	Gross interest-bearing debt (Note 1)		143.5	170.6	27.2
	Net interest-bearing debt		51.2	92.8	41.5		【Interest-bearing debt】
								Net interest-bearing debt increased 41.5 billion yen, mainly due to an increase in borrowings
	Shareholders' equity (Note 2)		159.5	170.2	10.8
								in response to higher operating capital.
		Retained earnings		89.3	99.1	9.8
								【Shareholders' equity】
		Other components of equity		16.6	19.3	2.8
							Increased 10.8 billion yen, mainly due to the accumulation of profit attributable to owners of
	(Note1）Gross interest-bearing debt = Total amount of bonds	and loans minus	lease liabilities
	(Note2）Shareholders' equity = Total equity attribute to owners of the parent				the parent.
	Equity ratio (Note 3)		25.1%	25.0%	0.1% down		Equity ratio was 25.0%. Net debt-equity ratio stood at 0.5 times.
	Net debt-equity ratio (Note 4)		0.3 times	0.5 times	0.2 pt up
	(Note 3) Equity ratio = Shareholders' equity / Total assets
	(Note 4) Net debt-equity ratio = Net interest-bearing debt / Equity capital

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