Mitsubishi Paper Mills : Summary of Consolidated Financial Results for the Three Months Ended June 30,2017(unaudited)

August 4, 2017

Summary of Consolidated Financial Results for the Three Months Ended June 30, 2017 (unaudited)

Company name: Mitsubishi Paper Mills Limited Stock exchange listing: Tokyo Stock Exchange Code number: 3864

URL: http://www.mpm.co.jp/

Representative: Kunio Suzuki, President and Chief Executive Officer Contact: Hironori Oikawa, General Manager, Finance & Accounting Dept.

Phone: [phone]

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

1. Consolidated Financial Results for the Three Months Ended June 30, 2017 (April 1, 2017 to June 30, 2017)

2. Consolidated Operating Results (% indicates changes from the previous corresponding period.)

   Net sales	Operating income	Ordinary income	Profit attributable to owners of parent
   Three months ended June 30, 2017 June 30, 2016	Million yen % 49,283 (3.2) 50,919 (3.5)	Million yen % (656) - 518 -	Million yen % (597) - (653) -	Million yen % (787) - (1,136) -

   (Note) Comprehensive income: Three months ended June 30, 2017: ¥(806) million [-%]

   Three months ended June 30, 2016: ¥(2,150) million [-%]

   Earnings per share	Diluted earnings per share
   Three months ended	Yen	Yen
   June 30, 2017	(23.03)	-
   June 30, 2016	(33.23)	-

   * The Company conducted a reverse stock split to consolidate every ten shares of common stock into one share on October 1, 2016. Earnings per share are calculated assuming that the reverse stock split was conducted at the beginning of the previous consolidated fiscal year.

3. Consolidated Financial Condition

4. Total assets	Net assets	Equity ratio
   As of June 30, 2017	Million yen	Million yen	%
   	233,881	55,793	22.9
   As of March 31, 2017	235,869	56,631	23.1

   (Reference) Equity: As of June 30, 2017: ¥53,531 million

   As of March 31, 2017: ¥54,383 million

5. Dividends

   Annual dividends
   1st quarter-end	2nd quarter-end	3rd quarter-end	Year-end	Total
   Fiscal year ended March 31, 2017 Fiscal year ending March 31, 2018	Yen - -	Yen 0.00	Yen -	Yen 0.00	Yen 0.00
   Fiscal year ending March 31, 2018 (Forecast)	0.00	-	-	-

   (Note) Revision to the forecast for dividends announced most recently: None

   Year-end dividend for Fiscal year ending March 31, 2018 has yet to be determined.

6. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2018 (April 1, 2017 to March 31, 2018)

7. (% indicates changes from the previous corresponding period.)

   Net sales	Operating income	Ordinary income	Profit attributable to owners of parent	Earnings per share
   Full year	Million yen % 205,000 1.5	Million yen % 4,000 (7.3)	Million yen % 2,500 (7.5)	Million yen % 1,500 30.1	Yen 43.88

   (Note) Revision to the financial results forecast announced most recently: None

   * Notes:

8. Changes in significant subsidiaries during the period under review (changes in specified subsidiaries resulting in changes in scope of consolidation): None

   New: - (Company name); Excluded: - (Company name)

9. Accounting policies adopted specially for the preparation of quarterly consolidated financial statements: None

10. Changes in accounting policies, changes in accounting estimates and retrospective restatement

11. Changes in accounting policies due to the revision of accounting standards: None

12. Changes in accounting policies other than 1) above: None

13. Changes in accounting estimates: None

14. Retrospective restatement: None

15. Total number of issued shares (common shares)

16. Total number of issued shares at the end of the period (including treasury shares): June 30, 2017: 34,258,433 shares

    March 31, 2017: 34,258,433 shares

17. Total number of treasury shares at the end of the period: June 30, 2017: 76,798 shares

    March 31, 2017: 76,185 shares

18. Average number of shares during the period:

19. Three months ended June 30, 2017: 34,181,933 shares

    Three months ended June 30, 2016: 34,184,934 shares

    * The Company conducted a reverse stock split to consolidate every ten shares of common stock into one share on October 1, 2016. Average number of shares for three months ended June 30, 2016 is calculated assuming that the reverse stock split was conducted at the beginning of the previous consolidated fiscal year.

    • This quarterly financial results report is exempt from quarterly review.

    • 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 acquired by the Company and certain assumptions assessed to be reasonable. Actual results may differ significantly from these forecasts due to a wide range of factors.

    Quarterly Consolidated Financial Statements

20. Quarterly Consolidated Balance Sheets

    (Million yen)

    Current assets
    Cash and deposits	10,840	9,083
    Notes and accounts receivable - trade	46,291	47,303
    Merchandise and finished goods	24,756	23,604
    Work in process	6,541	6,627
    Raw materials and supplies	10,108	10,030
    Other	5,475	5,704
    Allowance for doubtful accounts	(216)	(214)
    Total current assets	103,797	102,140
    Non-current assets

    Property, plant and equipment

    Assets

    As of March 31, 2017 As of June 30, 2017

    Buildings and structures, net	27,089	26,474
    Machinery, equip ment and vehicles, net	51,642	50,062
    Land	22,068	22,013
    Construction in progress	676	1,266
    Other, net	2,586	2,516
    Total property , plant and equip ment	104,064	102,334
    Intangible assets
    Other	291	1,285
    Total intangible assets	291	1,285
    Investments and other assets
    Investment securities	23,001	23,405
    Other	4,814	4,814
    Allowance for doubtful accounts	(99)	(98)
    Total investments and other assets	27,716	28,121
    Total non-current assets	132,071	131,741
    Total assets	235,869	233,881

    Current liabilities

    (Million yen)

    Liabilities

    As of March 31, 2017 As of June 30, 2017

    Notes and accounts payable - trade	24,556	22,373
    Short-term loans payable	68,264	69,897
    Income taxes payable	399	192
    Other	14,155	14,443
    Total current liabilities	107,376	106,906
    Non-current liabilities
    Long-term loans payable	57,570	56,990
    Reserve for loss on dissolution of employee's fund	143	143
    Net defined benefit liability	8,949	8,798
    Asset retirement obligations	888	888
    Other	4,310	4,358
    Total non-current liabilities	71,862	71,181
    Total liabilities	179,238	178,087
    Net assets
    Shareholders' equity
    Capital stock	32,756	32,756
    Capital surplus	7,438	6,271
    Retained earnings	8,599	8,980
    Treasury shares	(147)	(147)
    Total shareholders' equity	48,647	47,859
    Accumulated other comprehensive income
    Valuation difference on available-for-sale securities	5,506	5,789
    Foreign currency translation adjustment	1,245	985
    Remeasurements of defined benefit plans	(1,015)	(1,103)
    Total accumulated other comprehensive income	5,736	5,672
    Non-controlling interests	2,247	2,261
    Total net assets	56,631	55,793
    Total liabilities and net assets	235,869	233,881

21. Quarterly Consolidated Statements of Income and Comprehensive Income

Quarterly Consolidated Statements of Income Three Months Ended June 30

(Million yen)

For the three months ended June 30, 2016	For the three months ended June 30, 2017
Net sales	50,919	49,283
Cost of sales	42,577	42,332
Gross profit	8,341	6,951
Selling, general and administrative expenses	7,823	7,608
Op erating income (loss)	518	(656)
Non-operating income
Interest income	9	12
Dividend income	217	242
Foreign exchange gains	－	282
Other	88	85
Total non-operating income	315	622
Non-operating expenses
Interest expenses	562	457
Foreign exchange loss	827	－
Other	95	106
Total non-operating expenses	1,486	563
Ordinary loss	(653)	(597)
Extraordinary income
Gain on disposal of non-current assets	2	164
Gain on sales of investment securities	233	170
Other	0	－
Total extraordinary income	236	334
Extraordinary losses
Loss on disposal of non-current assets	221	101
Special retirement expenses	64	84
Other	104	1
Total extraordinary losses	390	186
Loss before income taxes	(807)	(449)
Income taxes	288	358
Loss	(1,095)	(807)
Profit (loss) attributable to non-controlling interests	40	(20)
Loss attributable to owners of parent	(1,136)	(787)

Quarterly Consolidated Statements of Comprehensive Income Three Months Ended June 30

(Million yen)

For the three months ended June 30, 2016

For the three months ended June 30, 2017

Loss (1,095) (807)

Other comprehensive income

Valuation difference on available-for-sale securities (700)356

Foreign currency translation adjustment (159)(254)

Remeasurements of defined benefit plans, net of tax (116)(69)

Share of other comprehensive income of entities

accounted for using equity method (78)(31)

Total other comprehensive income	(1,054)	0
Comprehensive income	(2,150)	(806)
Comprehensive income attributable to
Comprehensive income attributable to owners of parent	(2,081)	(851)

Comprehensive income attributable to non-controlling

interests

(68)

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