Milbon : Consolidated Financial Results for the Three Months Ended March 31, 2021

Consolidated Financial Results for the Three Months Ended March 31, 2021

[Japanese GAAP]

			May 11, 2021
Name of registrant:	Milbon Co., Ltd.	Tokyo Stock Exchange, First Section
Code No.:	4919	URL http://www.milbon.co.jp
Representative:	Ryuji Sato, President and CEO
Inquiries:	Masahiro Murai, Managing Director	TEL: [phone]

Scheduled filing date for quarterly report: May 14, 2021

Scheduled starting date of dividend payments: -

Preparation of supplementary materials on the quarterly results: Yes

Holding of an explanatory meeting on the quarterly results: Yes (Telephone briefing for institutional investors and analysts)

(Amounts of less than one million yen have been omitted.)

1. Consolidated financial results for the three months ended March 31, 2021 (January 1, 2021 - March 31, 2021)

			(1) Consolidated operating results																			(Percentages show year-on-year changes.)
								Net sales				Operating income		Ordinary income		Profit attributable to owners
															of parent
								Million yen	%			Million yen	%			Million yen	%		Million yen	%
			Three months ended March 31, 2021	8,989		14.9			1,633				58.4		1,502	79.8	1,091	81.4
			Three months ended March 31, 2020		7,825		(0.8)			1,031				(18.5)			835		(28.1)		601		(28.6)
(Note) Comprehensive income	Three months ended March 31, 2021: 1,370 million yen [-%]	Three months ended March 31, 2020: (357) million yen [-%]
								Basic earnings per share	Diluted earnings per share
										Yen					Yen
		Three months ended March 31, 2021				33.57			-
		Three months ended March 31, 2020				18.45			-
(2) Consolidated financial position
								Total assets				Net assets				Equity ratio
									Million yen				Million yen					%
		As of March 31, 2021						42,321							36,735						86.8
		As of December 31, 2020						43,075							36,308						84.3
(Reference)	Equity	As of March 31, 2021: 36,735 million yen	As of December 31, 2020: 36,308 million yen
2. Payment of dividends
																	Annual dividends
								End of 1st quarter	End of 2nd quarter	End of 3rd quarter		End of fiscal year		Total
									Yen				Yen				Yen				Yen		Yen
	Year ended December 31, 2020		-					27.00			-							29.00			56.00
	Year ended December 31, 2021		-
	Year ended December 31, 2021								28.00			-							28.00			56.00
	(forecast)
(Note) Changes to latest dividends forecast: None

3. Consolidated operating forecasts for the fiscal year ending December 31, 2021 (January 1, 2021 - December 31, 2021)

(Percentages show year-on-year changes.)

	Net sales		Operating income		Ordinary income	Profit attributable to	Basic earnings per share
			owners of parent
	Million yen	%	Million yen	%	Million yen	%	Million yen	%	Yen
Year ending December 31, 2021	38,200		6.9	6,420		0.4	5,710	(1.4)	4,050	(3.7)	124.50
(Note) Changes to latest performance forecast: None

*Notes
(1) Significant changes in subsidiaries during the period
(changes in specified subsidiaries resulting in the change in the scope of consolidation)	: None
New: 0 companies (Company name: )	Exclude: 0 companies (Company name: )

1. Application of accounting methods specific to the preparation of quarterly consolidated financial statements: None
2. Changes in accounting policies, changes in accounting estimates and retrospective restatements

1)	Changes in accounting policies due to amendment to the
	accounting standards, etc.	:	None
2)	Changes in accounting policies other than those in 1) above	:	None
3)	Changes in accounting estimates	:	None
4)	Retrospective restatements	:	None

(4) Number of shares issued (common stock)
1) Number of shares issued at the end of the period	As of	33,117,234 shares	As of	33,117,234 shares
(including treasury shares)	March 31, 2021	December 31, 2020
2) Number of treasury shares at the end of the period	As of	614,981 shares	As of	614,837 shares
	March 31, 2021	December 31, 2020
3) Average number of shares during the period	Three months ended	32,502,307 shares	Three months ended	32,612,847 shares
	March 31, 2021	March 31, 2020

*These financial statements are not subject to the review of the quarterly financial statements by a certified public accountant or an audit corporation.

*Explanation on the appropriate use of operating forecasts and other special instructions

Operating forecasts and other statements regarding the future presented in these materials are based on information currently available and certain assumptions deemed to be reasonable, and actual performance may differ substantially due to various factors.

Contents of supplementary materials
1. Qualitative Information on Consolidated Results for the Current Period .............................................................................	2
(1)	Explanation on operating results .................................................................................................................................	2
(2)	Explanation on financial position ...............................................................................................................................	3
(3)	Explanation on forward-looking statements including consolidated operating forecasts ............................................	3
2. Quarterly Consolidated Financial Statements and Main Notes ............................................................................................	4
(1)	Quarterly Consolidated Balance Sheets ......................................................................................................................	4
(2)	Quarterly Consolidated Statements of Earnings and Consolidated Statements of Comprehensive Income ................	6
	Quarterly Consolidated Statements of Earnings
	Three Months Ended March 31, 2020 and 2021 ...................................................................................................	6
	Quarterly Consolidated Statements of Comprehensive Income
	Three Months Ended March 31, 2020 and 2021 ...................................................................................................	7
(3)	Notes regarding quarterly consolidated financial statements ......................................................................................	8
	Notes regarding going concern assumption .................................................................................................................	8
	Notes in case of any significant changes in shareholders' equity .................................................................................	8
	Segment information, etc. ............................................................................................................................................	8
	Significant subsequent events ......................................................................................................................................	8

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1.Qualitative Information on Consolidated Results for the Current Period

(1)Explanation on operating results

In the first quarter of the fiscal year under review, the Japanese economy continued to face severe conditions as socioeconomic activities were severely restricted due to the launch of the second emergency declaration following the re-expansion of COVID-

19. Looking ahead, although economic recovery is expected due to the popularization of vaccines, the situation remains uncertain, including the impact of the launch of the third emergency declaration.

In the beauty salon industry as well, customers have begun to return to salons, but many customers, such as salons in urban areas, still have not returned enough, and the situation continues to be unpredictable.

Under these circumstances, in Fiscal Year 2021, we are working on "Change the Stage 18 Month Missions!" in order to lead us to a new stage of growth from Fiscal Year 2022.

In the first quarter of the fiscal year under review, in the domestic market, annual policy penetration that was held online due to the impact of COVID-19 was highly evaluated. In the hair care products category, sales of "Aujua", a premium brand, were strong, partly due to the launch of a new line. In the hair coloring products categorysegment, sales of the fashion color "Ordeve Addicthy" continued to be steady. In overseas markets, sales increased significantly in China and South Korea, where sales declined last year due to the impact of COVID-19.

As a result, for the first quarter of the current fiscal year, consolidated net sales were 8,989 million yen (up 14.9% year-on- year), operating income was 1,633 million yen (up 58.4% year-on-year), ordinary income was 1,502 million yen (up 79.8% year-on-year), and profit attributable to owners of parent was 1,091 million yen (up 81.4% year-on-year).

Breakdown of net sales by product category and breakdown of net sales into domestic and overseas sales are shown below: [Breakdown of consolidated net sales by product category]

											(Unit: Million yen)
		Three months ended March 31,	Three months ended March 31,	Increase
	2020		2021		Year-on-year
Product category			(decrease)
										change (%)
		Amount	Ratio (%)	Amount	Ratio (%)	amount
Hair care products	4,424		56.6		4,975			55.4	551	12.5
Hair coloring products	2,995		38.3		3,495			38.9	499	16.7
Permanent wave products	291		3.7		318			3.5	26	9.1
Cosmetic products	71		0.9		147			1.6	76	107.4
Other	42		0.5		52			0.6	10	23.8
Total		7,825		100.0		8,989			100.0	1,163	14.9
[Breakdown of net sales into domestic and overseas sales]
											(Unit: Million yen)
	Three months ended March 31,	Three months ended March 31,	Increase
	2020			2021		Year-on-year
				(decrease)
											change (%)
		Amount	Ratio (%)	Amount	Ratio (%)	amount
Domestic sales	6,590			84.2		7,182			79.9	592	9.0
Overseas sales	1,235			15.8		1,807			20.1	571	46.2
Total	7,825			100.0		8,989			100.0	1,163	14.9

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(2)Explanation on financial position

Total assets at the end of the first quarter under review decreased 753 million yen from the end of the previous fiscal year to 42,321 million yen.

Current assets decreased 1,280 million yen from the end of the previous fiscal year to 20,841 million yen. The main factors for the change were decreases of 1,604 million yen in cash and deposits and 172 million yen in notes and accounts receivable-trade, and increases of 367 million yen in merchandise and finished goods and 132 million yen in raw materials and supplies.

Non-current assets increased by 526 million yen from the end of the previous fiscal year to 21,480 million yen. Major contributing factors included an increase of 468 million yen in construction in progress, including partial advance payment for the construction of a new factory in China and the expansion of a factory in Milbon Thailand, and a decrease of 145 million yen in investment securities due to a decrease in unrealized gains on the market value of listed shares.

Current liabilities decreased by 1,181 million yen from the end of the previous fiscal year to 4,919 million yen. The main factors for the change were decreases of 936 million yen in accounts payable-other and 657 million yen in income taxes payable, and an increase of 338 million yen in accounts payable-trade.

Net assets increased by 427 million yen from the end of the previous fiscal year to 36,735 million yen. The main factors for the change were increases of 148 million yen in retained earnings and 301 million yen in foreign currency translation adjustment due to the depreciation of the yen, and a decrease of 100 million yen in valuation difference on available-for-sale securities due to a decrease in unrealized gains on market value of listed stocks.

As a result, the equity ratio changed from 84.3% at the end of the previous fiscal year to 86.8%. Net assets per share based on the total number of shares issued at the end of the fiscal year were 1,130.25 yen, compared to 1,117.10 yen at the end of the previous fiscal year.

(3)Explanation on forward-looking statements including consolidated operating forecasts

In terms of the full-year forecast there are no changes to the previous consolidated operating forecasts, which were announced on February 12, 2021.

Due to the high degree of uncertainty regarding the impact of COVID-19, the Company will promptly announce revisions to its consolidated earnings forecasts in the event that future changes, such as delays in the timing of convergence, require revisions to its consolidated earnings forecasts.

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