[Delayed]Consolidated Financial Results for the Six Months Ended September 30, 2021

Consolidated Financial Results

for the Six Months Ended September 30, 2021

[Japanese GAAP]

November 5, 2021

Company name: Nichireki Co., Ltd.

Stock exchange listing: Tokyo Stock Exchange

Code number: 5011

URL: https://www.nichireki.co.jp/english/

Representative: Manabu Obata, President and Representative Director

Contact: Takeshi Goto, Executive Officer and General Manager of Finance and Accounting Department

Phone: [phone]

Scheduled date of filing quarterly securities report: November 9, 2021

Scheduled date of commencing dividend payments: -

Availability of supplementary briefing material on quarterly financial results: Available

Schedule of quarterly financial results briefing session: Scheduled

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

1. Consolidated Financial Results for the Six Months Ended September 30, 2021 (April 1, 2021 to September 30, 2021)

(1) Consolidated Operating Results			(% indicates changes from the previous corresponding period.)
	Net sales			Operating profit	Ordinary profit	Profit attributable to
			owners of the parent
								company
Six months ended	Million yen	%		Million yen	%	Million yen	%	Million yen	%
September 30, 2021	32,416	-		2,779	(4.6)	2,947	(9.2)	2,002	(5.2)
September 30, 2020	28,555	4.9		2,915	128.2	3,246	133.8	2,111	-
(Note) Comprehensive	income: Six months	ended September 30, 2021: ¥2,292 million [(1.8)%]
	Six months ended September 30, 2020: ¥2,333 million (-%)
	Basic earnings	Diluted earnings
	per share		per share
Six months ended	Yen			Yen
September 30, 2021	65.54		-
September 30, 2020	73.66		-

(Note) As the Company has implemented the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020) and such since the beginning of the first quarter of the consolidated fiscal year, the figures presented for the six months ended September 30, 2021, are those after the implementation of the said standard and such. Changes in net sales from the previous corresponding period are not presented.

(2) Consolidated Financial Position

	Total assets	Net assets	Equity ratio
	Million yen	Million yen	%
As of September 30, 2021	81,105	63,566	78.4
As of March 31, 2021	82,732	62,010	74.9

(Reference) Equity: As of September 30, 2021: ¥63,566 million As of March 31, 2021: ¥61,997 million

2. Dividends

				Annual dividends
		1st	2nd		3rd		Year-end		Total
		quarter-end	quarter-end		quarter-end
Fiscal year ended		Yen	Yen		Yen		Yen		Yen
-	-	-		38.00	38.00
March 31, 2021
Fiscal year ending	-	-
March 31, 2022
Fiscal year ending				-		40.00	40.00
March 31, 2022 (Forecast)
(Note) Revision to the dividends forecast announced most recently: No

3. Forecasts of Consolidated Financial Results in the Fiscal Year Ending March 31, 2022 (April 1, 2021 to March 31, 2022)

(% indicates changes from the previous corresponding period.)

				Operating profit	Ordinary profit	Profit attributable	Basic earnings
		Net sales		to owners of the
			per share
								parent company
		Million yen	%	Million yen	%	Million yen	%	Million yen	%	Yen
Full year	78,000	-	8,000	(12.5)	8,200	(14.4)	5,300	(16.6)	173.50
(Note)	Revision to the financial results forecast announced most recently: No
(Note)	As the Company has implemented the Accounting Standard for Revenue Recognition (ASBJ Statement No.

29, March 31, 2020) and such since the beginning of the first quarter of the consolidated fiscal year, forecasts of consolidated financial results shown above are those after the implementation of the said standard and such. Changes in net sales from the previous corresponding period are not presented.

* Notes:

1. Changes in significant subsidiaries during the six months ended September 30, 2021 (changes in specified subsidiaries resulting in changes in scope of consolidation): No
2. Accounting policies adopted specially for the preparation of quarterly consolidated financial statements: No
3. Changes in accounting policies, changes in accounting estimates and retrospective restatement
4. 1. Changes in accounting policies due to the revision of accounting standards: Yes
   2. Changes in accounting policies other than 1) above: No
   3. Changes in accounting estimates: No
   4. Retrospective restatement: No

(Note) For more details, please refer to "(3) Notes to the Quarterly Consolidated Financial Statements (Changes in Accounting Policies)" in "2. Quarterly Consolidated Financial Statements and Primary Notes" on page 8 of the Appendix.

1. Total number of issued shares (common shares)
2. 1. Total number of issued shares at the end of the period (including treasury shares): As of September 30, 2021: 31,685,955 shares
      As of March 31, 2021: 31,685,955 shares
   2. Total number of treasury shares at the end of the period:

As of September 30, 2021: 1,117,297 shares

As of March 31, 2021: 1,414,587 shares

1. Average number of shares during the period (cumulative from the beginning of the fiscal year): Six months ended September 30, 2021: 30,548,297 shares
   Six months ended September 30, 2020: 28,671,563 shares

• These quarterly consolidated financial results are outside the scope of quarterly review by certified public accountants or audit firms.
• 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 currently 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.

For assumptions of the forecasts of the financial results and precautions in using the forecasts, please refer to "(3) Explanation of Consolidated Financial Results Forecast and Other Forward-Looking Information" in "1. Qualitative Information on Quarterly Financial Results for the Period under Review" on page 3 of these quarterly consolidated financial results (Appendix).

(How to obtain the supplementary briefing material on quarterly financial results)

The Company will hold the quarterly financial results briefing session for institutional investors and analysts on Tuesday, November 30, 2021. Materials for the briefing session will be posted on the Company's website after the briefing session.

Table of Contents
1. Qualitative Information on Quarterly Financial Results for the Period under Review ..................................	2
(1)	Explanation of Operating Results ..............................................................................................................	2
(2)	Explanation of Financial Position ..............................................................................................................	3
(3)	Explanation of Consolidated Financial Results Forecast and Other Forward-Looking Information .........	3
2. Quarterly Consolidated Financial Statements and Primary Notes ..................................................................	4
(1)	Quarterly Consolidated Balance Sheets .....................................................................................................	4
(2)	Quarterly Consolidated Statements of Income and Comprehensive Income .............................................	6
(3)	Notes to the Quarterly Consolidated Financial Statements ........................................................................	8
(Notes on Going Concern Assumption) ......................................................................................................	8
(Notes in the Case of Significant Changes in Shareholders' Equity) ..........................................................	8
(Changes in Accounting Policies) ...............................................................................................................	8
(Segment Information, etc.) .......................................................................................................................	10
(Revenue Recognition) ..............................................................................................................................	11

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1. Qualitative Information on Quarterly Financial Results for the Period under Review

(1) Explanation of Operating Results

In the six months ended September 30, 2021, the Japanese economy continued to face ongoing severe situations such as delays in the recovery of business conditions of some non-manufacturing companies against the backdrop of weak consumer spending due to the effects of novel coronavirus disease (COVID-19). Overall, however, it remained on a moderate recovery trend as production and corporate earnings continued to recover mainly in the manufacturing industry, with signs of further improvement in business confidence, due to factors including increases in exports and capital expenditures and recovery in housing investment. In terms of future prospects, the trend towards recovery is expected to become more evident due to progress in vaccination efforts and the complete lifting of the declaration of a state of emergency and priority measures to prevent the spread of COVID-19 as of the end of September as well as the expected effects of government economic measures and others.

The business environment surrounding the Group continues to require close watch on negative factors for business results, including soaring crude oil prices, while a high level of public investment is expected against the backdrop of growing construction demand for preventing and mitigating disasters, national resilience measures, etc. Despite such a business environment that is not necessarily favorable, the Group established its new Medium-term Management Plan "Resilience 2025 (Shinayaka 2025)," which commenced in this fiscal year, and has implemented various measures aimed at growing into a sustainable corporate group with the entire organization working as one under quick and accurate decision making.

In the six months ended September 30, 2021, the Group posted net sales of ¥32,416 million (net sales of ¥28,555 million in the previous corresponding period), operating profit of ¥2,779 million (down 4.6% year on year), ordinary profit of ¥2,947 million (down 9.2% year on year), and profit attributable to owners of the parent company of ¥2,002 million (down 5.2% year on year). With the application of the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020) etc., net sales decreased by ¥401 million.

Results by business segment were as follows.

Applied and Processed Asphalt Products Business

In the Applied and Processed Asphalt Products Business, in addition to coping with hikes in the prices of raw materials, we worked on increasing sales by promoting design and marketing activities for high value-added products contributing to "longer pavement life and higher performance" and "reduction of environmental load." Net sales for the segment were ¥11,051 million (net sales of ¥8,358 million in the previous corresponding period) and segment profit was ¥2,705 million (up 3.2% year on year) in the six months ended September 30, 2021. With the application of the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March

31, 2020), etc., net sales decreased by ¥401 million.

Road Paving Business

In the Road Paving Business, in addition to steady progress of construction works including those for preventing and mitigating disasters and national resilience measures, we worked on improving cost management.

Net sales for the segment were ¥21,214 million (up 5.8% year on year) and segment profit was ¥1,599 million (up 8.6% year on year) in the six months ended September 30, 2021.

Other Business

In the Other Business, net sales for the segment were ¥ 150 million (down 1.2 % year on year) and segment profit was ¥113 million (down 10.9% year on year) mainly due to real estate lease revenue.

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