FP : Consolidated Financial Results for the Three Months Ended June 30, 2021

July 30, 2021

Consolidated Financial Results for the Three Months Ended June 30, 2021

Company name:	FP Corporation
Stock exchange listing:	Tokyo Stock Exchange
Stock code:	7947	URL:	https://www.fpco.jp/
Representative:	Morimasa Sato, Representative Director, President
Contact:	Isao Ikegami, Executive Vice President and Director, Executive General Manager of Finance and
	Accounting Division
	Tel. [phone]

Scheduled date to submit the Quarterly Securities Report (Shihanki Houkokusho):	August 5, 2021
Scheduled date for commencement of dividend payments:			‒
Supplementary documents for quarterly results:				Yes
Quarterly results briefing:						None
							(Amounts of less than one million yen are truncated.)
1. Consolidated Financial Results for the Three Months Ended June 30, 2021 (April 1, 2021 - June 30, 2021)
(1) Consolidated Results of Operations					(Percentages show year-on-year changes.)
		Net sales		Operating profit		Ordinary profit	Profit attributable to
				owners of parent
Period ended		Million yen	%	Million yen	%		Million yen	%	Million yen	%
June 30, 2021		47,647	6.0	4,051	11.3		4,283	12.0	2,734	11.0
June 30, 2020		44,966	-	3,641	-		3,824	-	2,464	-

(Note) Comprehensive income:	Period ended June 30, 2021:	2,662 million yen	(-3.5%)
		Period ended June 30, 2020:	2,760 million yen	(-%)
	Net income per share	Net income per share
	(basic)		(diluted)
Period ended		Yen	Yen
June 30, 2021		33.43	-
June 30, 2020		29.81	-

(Notes) 1. On October 1, 2020, the Company implemented a two-for-one common stock split. Net income per share was calculated assuming that the stock split was implemented at the beginning of the previous consolidated fiscal year.

1. 2. The Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020), etc. has been applied from the beginning of the first quarter under review. The Accounting Standard, etc. are applied retroactively to the figures for the first quarter of the fiscal year ended March 31, 2021. No year-on-year percentage changes are thus stated for the figures in the first quarter of the fiscal year ended March 31, 2021.

2. Consolidated Financial Position

	Total assets		Net assets		Equity ratio		Net assets per share
As of		Million yen		Million yen			%		Yen
June 30, 2021		254,547		125,679				49.1		1,528.39
March 31, 2021		247,234		124,980				50.3		1,520.06
(Reference) Equity:	As of June 30, 2021:		125,031 million yen
		As of March 31, 2021:		124,349 million yen
2. Dividends
					Dividend per share
		End of first quarter	End of second	End of third quarter		Year-end	Annual
		quarter
			Yen	Yen		Yen			Yen	Yen
Year ended March 31, 2021	-	41.00		-		24.00	-
Year ending March 31, 2022	-
Year ending March 31, 2022			21.50		-		25.50	47.00
(forecast)
(Notes) 1. Revisions to dividend forecasts published most recently: No

2. The Company had a two-for-one split of its common stock, effective October 1, 2020. The dividend per share for the end of the second quarter for the year ending March 31, 2021 is the dividend per share before the stock split. The year- end dividend is a dividend after the stock split. The annual dividend is not stated because a simple calculation is impossible due to the stock split. The dividend for the end of the second quarter and annual dividend calculated using the basis for calculation after the stock split are 20.5 yen and 44.5 yen, respectively.

3. Consolidated Forecasts for the Fiscal Year Ending March 31, 2022 (April 1, 2021 - March 31, 2022)

(Percentages show year-on-year changes.)

	Net sales		Operating profit	Ordinary profit	Profit attributable to	Net income
		owners of parent	per share
	Million yen	%	Million yen	%	Million yen	%	Million yen	%	Yen
First six months	96,700	5.3	8,780	5.6	9,100	6.3	5,840	3.3	71.39
Year ending	195,000	4.0	19,600	4.5	20,200	4.2	12,900	5.6	157.69
March 31, 2022
(Notes) 1. Revisions to consolidated business performance forecasts published most recently: No

2. The year-on-year changes are calculated based on the comparison with the figures for the previous fiscal year after a change in accounting policy is reflected retroactively.

* Notes

1. Changes in significant subsidiaries during the period
   (changes in specified subsidiaries accompanying changes in scope of consolidation): No
2. Application of particular accounting treatment concerning preparation of quarterly consolidated financial statements: No
3. Changes in accounting policies and accounting estimates, and restatement
4. 1. Changes in accounting policies accompanying amendments to accounting standards, etc.: Yes

(ii) Changes in accounting policies other than (i):	No
(iii) Changes in accounting estimates:	No
(iv) Restatement:	No

(Note) For further details, see "2. Quarterly Consolidated Financial Statements and Key Notes, (4) Notes to Quarterly Consolidated Financial Statements (Changes in Accounting Policies)" on page 14 of the "Accompanying

Materials."

(4) Number of shares outstanding (common shares):

(i) Number of shares outstanding at end of period (including treasury shares)

As of June 30, 2021:	84,568,424 shares
As of March 31, 2020:	84,568,424 shares
(ii) Number of treasury shares at end of period:
As of June 30, 2021:	2,762,680 shares
As of March 31, 2021:	2,762,648 shares

(iii) Average number of shares outstanding during the period (consolidated cumulative period)

Three Months ended June 30, 2021:	81,805,752 shares
Three Months ended June 30, 2020:	82,679,614 shares

(Note) On October 1, 2020, the Company implemented a two-for-one common stock split. The average number of shares outstanding during the period is calculated on the assumption that the stock split was implemented at the beginning of the previous fiscal year.

• Quarterly consolidated financial results are outside the scope of audit procedures by certified public accountants and audit firm.
• Explanations and other special notes concerning the appropriate use of business performance forecasts

(Notes on forward-looking statements)

Descriptions regarding the future, such as the forecast of financial results herein, are calculated based on the information which is available to the Company as of the date hereof. Please note that actual results may be different due to various factors such as subsequent changes in business environment. For assumptions underlying the forecasts and notes to the use of the forecasts, please refer to "1. Qualitative Information Relating to Consolidated Results of Operations for the First Quarter Ended June 30, 2021; (3) Explanation of Information on Future Forecasts, Including the Forecast of Consolidated Results" on page 8 of the "Accompanying Materials."

(How to obtain supplementary documents for quarterly results)

Documents for financial results are published on the Company's website as soon as they are announced.

Accompanying Materials - Contents
1. Qualitative Information Relating to Consolidated Results of Operations for the First Quarter Ended June 30, 2021 ............	2
(1)	Explanation of Financial Results ......................................................................................................................................	2
(2)	Explanation of Financial Situation ...................................................................................................................................	7
(3)	Explanation of Information on Future Forecasts, Including the Forecast of Consolidated Results ..................................	8
2. Quarterly Consolidated Financial Statements and Key Notes ................................................................................................	9
(1)	Quarterly Consolidated Balance Sheets............................................................................................................................	9
(2)	Quarterly Consolidated Statement of Income and Quarterly Consolidated Statement of Comprehensive Income.........	11
	Quarterly Consolidated Statement of Income
	First three-month period ..............................................................................................................................................	11
	Quarterly Consolidated Statement of Comprehensive Income
	First three-month period ..............................................................................................................................................	12
(3)	Quarterly Consolidated Statement of Cash Flows ..........................................................................................................	13
(4)	Notes to Quarterly Consolidated Financial Statements ..................................................................................................	14
	Note to Going Concern Assumption...............................................................................................................................	14
	Notes on Any Significant Change in the Value of Shareholders' Equity .......................................................................	14
	Changes in Accounting Policies .....................................................................................................................................	14
	Quarterly Consolidated Statement of Income .................................................................................................................	14
	Revenue Recognition......................................................................................................................................................	15
	Important Subsequent Events .........................................................................................................................................	15

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1. Qualitative Information Relating to Consolidated Results of Operations for the First Quarter Ended June 30, 2021

(1) Explanation of Financial Results

The Group ensures the Hands-on Approach and Customer-First Concept as its source and practices the three basic pillars of a manufacturer, that is, "reliably deliver the most environmentally friendly products of the highest quality," "at the most competitive prices," "whenever they are needed." In 2021, the Group aims to achieve growth by having all departments create great synergy through mutual understanding and cooperation under the theme of "sympathetic resonance."

(Net sales)

Net sales for the first three months of the consolidated fiscal year under review (from April 1, 2021 to June 30, 2021) increased 6.0% year on year, to 47,647 million yen, a new record high. Net sales of products manufactured by the Group rose 4.4% year on year to 36,792 million yen. Net sales of goods purchased increased 11.7% year on year to 10,854 million yen. The FPCO Group began to apply Accounting Standard for Revenue Recognition (ASBJ Statement No. 29), etc. in the fiscal year under review. Values obtained by retroactively applying the Accounting Standard for Revenue Recognition to the results of the fiscal year ended March 31, 2021 were used for calculating the year-on-year changes. Sales volume of products increased 5.6% year on year, including the contribution to a 2.5% increase by the business transfer from Sekisui Hinomaru K.K. (now known as Kyushu Sekisui Shoji Infratec Co., Ltd.) that was conducted in October 2020.

Shipment of containers for supermarkets was strong due to the continuing demand for cooking and eating at home reflecting COVID-19. In addition, the market of takeout and delivered food from restaurants continues to expand, partly reflecting the launch of takeout and delivery services by major restaurant chains and luxury restaurants. On the other hand, containers for convenience stores, those for boxed meals sold at railway stations, and those for picnics and events have yet to see a recovery in demand, with the exception of a rebound from the previous fiscal year seen in some cases.

The Group will continue striving to ensure stable supply by using its supply chain management system to continue supporting safe, secure food lifestyles.

(Profits)

For the first three months under review, operating profit increased 409 million yen, or 11.3 % year on year, to 4,051 million yen, ordinary profit also increased 459 million yen (*1), or by 12.0% year on year, to 4,283 million yen, ordinary profit before depreciation and amortization increased 5.6% year on year, to 7,641 million yen, and profit attributable to owners of parent increased 11.0% year on year, to 2,734 million yen. All of these are record-high figures. Factors for the increase of profits include an increase in sales volumes of containers for supermarkets and those for takeout and delivered food and the improvement effect of production and logistics sites. On the other hand, factors that decreased profits included a rise in raw material prices and an increase in labor expenses. Further, insurance claim income of 2,138 million yen from the fire at the Chubu Plant 1 was posted as extraordinary income. On the other hand, an increase in expenses that resulted from the fire, which was 58 million yen, and a loss on tax purpose reduction entry of non-current assets related to the new plant that is under construction as the alternative asset to the plant lost in the fire, which is 2,229 million yen, was posted as extraordinary loss. Both net sales and profits were almost on par with the projection at the beginning of the fiscal year.

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(*1) Factor for the increase/decrease of ordinary profit

	Increase/Decrease in Ordinary Profit (For the Three Months Ended June 30, 2021)
0.0	20.0	40.0		60.0	80.0		100.0	120.0	140.0	160.0	Unit: billion yen	200.0
														180.0
前年								FY ended March 2021	19.38
			1st half	8.56					2nd half	10.82
1Q	1Q	3.82
原料							The Price of	-0.20
							Material
							* Including the impact of naphtha-linked pricing on selling prices to customers

販売

生産

物流

グループ

		Sales Efforts
Year on year		Improved
	Production
+0.46
	Improved
	Distribution
		Group
		Companies

+0.60

+0.15

+0.15

+0.10

Improvement	+0.66
Labor costs	-0.47
Depreciation	+0.10

Electric power changes ±0.00

Freight costs

+0.11

経費

1Q

当年

FY ended		-0.34	Labor costs	-0.22
March 2022	Expenses	Depreciation	-0.05
Other	-0.07
1Q	4.28
	1st half outlook	9.10			2nd half outlook 11.10
					Full year outlook 20.20

1

(Sales activities)

In sales activities, the Group makes proposals to create value by contributing to increasing customers' income, reducing their costs, and reducing the Company's costs. Specific activities include initiatives to promote the Group's products in the market for takeout and delivered food, in addition to stepping up initiatives for existing customers by studying their needs more closely and discovering new markets such as those for hospital food, nursing care food, and frozen food. As new products for the market for takeout and delivered food, the Group launched containers featuring designs that look attractive on social media (*2) in addition to a heat-retaining,leakage-proof special container for noodles and a container featuring a Stack & Connect design for a low possibility of collapsing during transportation. To capture new demand, the Group is advancing initiatives including the lineup enhancement of the Pack Market e-commerce site offering packaging materials, and measures for improving its visibility including SEO, radio commercials, and corporate communication activities via Instagram, YouTube, LINE, and other social media.

(*2) DLV Lunch (cow pattern and watermelon pattern)

(Production)

The production sector is striving to improve productivity through initiatives that include improvements in capacity utilization and the promotion of automation. As of June 30, 2021, the Company operates 81 pieces of automated equipment on 53 production process lines. In addition, the Group is advancing initiatives for improving quality through the acquisition of certification under FSSC 22000, an international standard on food safety management. The Company also promotes safety training including hazard simulation training.

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