BML : Consolidated Earnings Report for the First Quarter of Fiscal 2022

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Disclaimer: This is a Japanese-English translation of the summary of financial statements of the Company produced for your convenience. Since no auditor audited this report, officially only the Japanese version is assumed to be the summary of financial statements of the Company. This summary does not constitute any guarantee and the Company will not compensate any losses and/or damage stemming from actions taken based on these statements. Should there be any discrepancy between the Japanese and English versions, the Japanese version is assumed to be correct.

August 10, 2022

CONSOLIDATED EARNINGS REPORT
FOR THE FIRST QUARTER OF FISCAL 2022
	[Japanese GAAP]
Company Name:	BML, Inc.
Stock Listing:	Tokyo Stock Exchange
Stock Code:	4694
URL:	http://www.bml.co.jp/
Representative:	Kensuke Kondo, President and Representative Director
Contact:	Norihisa Takebe, Director and Senior Managing Executive Officer
	Tel: [phone]
Scheduled Date for Filing of Quarterly Report:	August 12, 2022
Scheduled Date for Payment of Dividends:	-
Creation of Supplementary Explanatory Materials:	None
Holding of Explanatory Meeting:		None

(Rounded down to nearest million yen)

1. Results for the First Quarter of Fiscal 2022 (April 1, 2022-June 30, 2022)

(1) Consolidated business results

					(% indicates year-on-year changes)
	Net sales	Operating profit	Ordinary profit	Profit attributable to
	owners of parent
	¥ million	%	¥ million	%	¥ million	%	¥ million	%
1Q of FY2022	40,478	(14.0)	6,852	(51.2)	6,893	(53.6)	4,722	(52.5)
1Q of FY2021	47,092	80.4	14,052	-	14,870	-	9,937	-

(Note) Comprehensive income: 1Q of FY2022	¥4,719 million / (53.3)%	1Q of FY2021 ¥10,096 million / -%
		Basic earnings per share		Diluted earnings per share
			Yen		Yen
	1Q of FY2022		119.20		119.12
	1Q of FY2021		244.47		244.27

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(2) Consolidated financial position

Total assets

Net assets

Equity ratio

¥ million

¥ million

%

As of June 30, 2022

163,520

120,817

70.5

As of March 31, 2022

179,200

121,684

64.8

(Reference) Equity capital: As of June 30, 2022 ¥115,348 million

As of March 31, 2022

¥116,163 million

2. Dividends

Dividends per share

First quarter-

Second quarter-

Third quarter-

Year-end

Full year

end

end

end

Yen

Yen

Yen

Yen

Yen

FY2021

―

35.00

―

85.00

120.00

FY2022

―

FY2022

40.00

―

40.00

80.00

(forecast)

(Note) Revision of dividend projection from recently announced figures: None

3. Consolidated Cumulative Earnings Forecast for the Fiscal Year Ending March 31, 2023 (April 1, 2022-March 31, 2023)

						(%	indicates	year-on-year changes)
									Profit
							Profit attributable	attributable to
	Net Sales	Operating profit	Ordinary profit	to owners of	owners of
							parent	parent per
									share
	¥ million	%	¥ million	%	¥ million	%	¥ million	%	Yen
Full year	146,000	(21.5)	16,500	(66.3)	17,000	(66.7)	11,000	(67.4)	280.87

(Note) Revision from recently projected results: None

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* Notes

(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries due to changes in the scope of consolidation): None

Increases: -

Decreases: -

1. Adoption of specific accounting methods in preparing quarterly financial statements: None
2. Changes in accounting policies and changes or revisions in accounting estimates

1. Changes in accounting policies in conjunction with revisions to accounting standards: Yes
2. Other changes: None
3. Changes in accounting estimates: None
4. Restatements: None

1. Number of outstanding shares (common shares)
   a. Number of outstanding shares at the end of the period (treasury shares included)

	As of June 30, 2022	43,514,726	As of March 31, 2022	43,514,726
b. Number of treasury shares at the end of the period
	As of June 30, 2022	4,176,902	As of March 31, 2022	3,586,202
c. Average number of shares during the period
	1Q ended June 30, 2022	39,617,274	1Q ended June 30, 2021	40,647,064

• The quarterly financial results are not subject to quarterly review by a certified public accountant or an audit firm.
• Disclaimer regarding appropriate use of forecasts and related points of note

Earnings forecasts contained in these materials are based on certain assumptions judged to be reasonable, and on the information available when the forecasts were made. However, the Company makes no guarantee that these forecasts will be achieved. Actual results may differ significantly from the forecasts due to a variety of factors. Please refer to "(3) Consolidated earnings forecasts and others" under "1. Qualitative information on operating results for quarter under review" on page 5 of this earnings report concerning financial forecasts such as the assumptions used for financial forecasts, factors that could cause these assumptions to change, and cautionary notes.

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1. Qualitative information on operating results for quarter under review

1. Operating results

In the first three months of the consolidated fiscal year under review, the Japanese economy began to show signs of recovery under a declining rate of COVID-19 infections and the lifting of restrictions on activities. However, the outlook remained uncertain due to factors including rising raw materials prices under the prolongation of the Ukrainian situation and the weakening of the yen.

Under these circumstances, the contract clinical testing business remained in a challenging environment given the impact of the biennial revision of medical service fees under the national health insurance (NHI) system and the lackluster trend in the number of people who sought medical care while competition among companies continued.

In these conditions, net sales for the first three months of the fiscal year under review were ¥40,478 million, a decrease of 14.0% year on year, and operating profit was ¥6,852 million, a decrease of 51.2% year on year. Ordinary profit was ¥6,893 million, a decrease of 53.6% year on year, and profit attributable to owners of parent was ¥4,722 million, a decrease of 52.5% year on year. Although contract testing numbers within testing overall increased for the BML Group, both net sales and profit decreased due to the reduction in medical service fees for testing related to COVID-19.

Conditions by business segment are described below.

In the clinical testing business, the BML Group made efforts in new customer acquisition, and sought to enhance business performance by implementing marketing activities to further cultivate sales of new testing items, unique testing items, priority testing items, and others. . However, due to the considerable impact of the reduction in medical service fees for testing related to COVID-19, net sales in the clinical testing business declined 15.3% year on year.

In the food hygiene business, areas including food consulting and microbe testing recovered due to the lifting of priority measures for contagion prevention and the relaxation of restrictions on business partners' sales activities. As a result, net sales increased by 9.3% year on year.

As a result of the above, net sales in the testing business overall decreased by 14.8%.

Sales in the medical informatics business increased 14.4% year on year due to the release of a cloud- based electronic patient chart system in April 2022 and subsequent progress of sales according to plan, in addition to solid maintenance sales.

In other businesses, the dispensing pharmacy business was affected by a revision of medical service fees (reduction in drug prices), and net sales recorded a decrease of 2.3% year on year.

(2) Financial position

Assets, Liabilities and Net Assets

At the end of the first quarter of the consolidated fiscal year under review, total assets amounted to ¥163,520 million, a ¥15,680 million decrease over the end of the previous fiscal year, net assets totaled ¥120,817 million, down ¥866 million over the end of the previous fiscal year, and the equity ratio was 70.5%, a 5.7 percentage point increase over the end of the previous fiscal year.

As for the main items contributing to an increase or decrease, in the assets section, under current

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assets, cash and deposits decreased by ¥6,432 million and notes and accounts receivable-trade decreased by ¥6,346 million. In the liabilities section, under current liabilities, income taxes payable decreased by ¥11,472 million. The net assets section decreased by ¥1,980 million due to the acquisition of treasury shares, but retained earnings increased by ¥1,327 million.

1. Consolidated earnings forecasts and others
   The Company has not changed its forecasts for consolidated results for the full year announced in the beginning of the fiscal year under review.

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