Nichi Iko Pharmaceutical : 〔Delayed〕Consolidated Financial Results for the Third Quarter of the Fiscal Year Ending March 31, 2022（IFRS）

(English Translation)

Consolidated Financial Results

for the Third Quarter of the Fiscal Year Ending March 31, 2022 (IFRS)

		February 14, 2022
Company name: Nichi-Iko Pharmaceutical Co., Ltd.	Stock exchange listings:
		Tokyo Stock Exchange
Securities code: 4541	(URL https://www.nichiiko.co.jp/)
Representative: Yuichi Tamura
	President and CEO
Contact:	Shuji Ishida	Tel: [phone]
	Senior Operating Officer, Head of
	Administrative Division

Scheduled date of filing of quarterly report:	February 14, 2022
Scheduled date of commencement of dividend payment:	-
Presentation of supplementary materials on quarterly financial results:	Yes
Holding of quarterly financial presentation meeting:	No

(Note that all amounts have been rounded down to the nearest one million yen.)

1. Consolidated Financial Results for the Third Quarter of the Fiscal Year Ending March 31, 2022 (From April 1, 2021 to December 31, 2021)

1. Consolidated Results of Operations (cumulative)

(Percentage figures represent changes from the same period of the previous fiscal year)

				Core								Profit
					Operating	Profit before		attributable
	Revenue		operating		Profit
			profit	tax	to owners of
				profit
											parent
Third quarter of	¥134,892		-¥9,907		-¥15,337	-¥14,269	-¥16,139	-¥15,704
fiscal year
million			million		million	million	million	million
ending March
(-2.8%)		(-%)			(-%)	(-%)	(-%)	(-%)
31, 2022
Third quarter of	¥138,845		¥1,860			¥17	-¥95	-¥267	-¥216
fiscal year ended	million			million		million	million	million	million
March 31, 2021	(-2.3%)		(-73.6%)		(-99.7%)	(-%)	(-%)	(-%)
	Total		Basic earnings		Diluted
	comprehensive			earnings per
		per share
	income				share
Third quarter of	-¥13,497
fiscal year
million		-¥235.54			-¥235.54
ending March
(-%)
31, 2022
Third quarter of	-¥2,573
fiscal year ended	million		-¥3.38			-¥3.38
March 31, 2021	(-%)

(Note)

Core operating profit is calculated by deducting gains and losses caused by extraordinary factors (extraordinary items) from operating profit.

1. Consolidated Financial Position

Ratio of total

Equity

equity

Equity attributable

attributable to

attributable

Total assets

Total equity

to owners of

owners of

to owners of

parent per share

parent

the parent to

total assets

Third quarter of

fiscal year

¥360,595

¥102,737

¥102,150

28.3%

¥1,450.29

ending March

million

million

million

31, 2022

Fiscal year

¥363,572

¥112,435

¥111,167

ended March 31,

30.6%

¥1,733.58

million

million

million

2021

2. Dividends

Annual dividends per share

First quarter

Second quarter

Third quarter

Year-end

Total

Fiscal year ended

¥-

¥15.00

¥-

¥10.00

¥25.00

March 31, 2021

Fiscal year ending

¥-

¥0.00

¥-

March 31, 2022

Fiscal year ending

March 31, 2022

¥0.00

¥0.00

(forecast)

(Note)

Revisions to recently announced dividends forecast: None

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

(Percentage figures represent changes from the previous fiscal year)

				Profit
	Revenue	Core operating	Operating	attributable to	Basic earnings
	profit	profit	owners of	per share
				parent
	¥185,000	-¥11,900	-¥17,100	-¥18,600
Annual	million	million	million	million	-¥275.39
	(-1.7%)	(-%)	(-%)	(-%)

(Note)

Revisions to recently announced forecast of financial results: None

*Notes

1. Changes in significant subsidiaries during the consolidated cumulative quarter under review (changes in specified subsidiaries resulting in change in scope of consolidation): No
2. Changes in accounting policies and changes in accounting estimates

(i)	Changes in accounting policies required by IFRS:	No
(ii)	Changes in accounting policies due to other reasons:	No
(iii)	Changes in accounting estimates:	No

(3) Total number of issued shares (common stock)

1. Total number of issued shares as of the end of the period (including treasury shares):

As of December	31, 2021	71,382,652 shares
As of March 31,	2021	65,162,652 shares

1. Number of treasury shares as of the end of the period:

As of December	31, 2021	948,075 shares
As of March 31,	2021	1,036,650 shares
(iii) Average number of shares during the period (cumulative quarter):
Third quarter of fiscal year ending March 31, 2022	66,673,306 shares
Third quarter of fiscal year ended March 31, 2021	63,997,238 shares

(Note)

Number of treasury shares as of the end of the period includes shares held by the Employee Shareholding Incentive Plan.

• Quarterly financial results reports are exempt from quarterly reviews conducted by certified public accountants or an audit corporation.
• Explanation on the appropriate usage of forecast of financial results, and other specific matters
  (Considerations on forward-looking statements)
  The forward-looking statements including forecast of financial results contained in these materials are based on the information currently available to the Company and certain assumptions which are regarded as legitimate. As such, they do not constitute the Company's guarantee that such results would be achieved. Actual business and other results may differ substantially from the forecasts provided in these materials as a result of various factors.
  (How to obtain supplementary materials for financial results)
  Supplementary materials for financial results will be provided on the website of the Company on Monday, February 14, 2022.

Attachment - Contents
1. Qualitative Information on Financial Results for the Quarter under Review ........................................	2
(1)	Explanation on Operating Results ...................................................................................................	2
(2)	Explanation on Financial Position ...................................................................................................	4
(3)	Explanation of Forecast of Consolidated Financial Results and Other Forward-looking
	Statements ........................................................................................................................................	6
2. Condensed Quarterly Consolidated Financial Statements and Primary Notes ......................................	7
(1)	Condensed Quarterly Consolidated Statement of Financial Position ..............................................	7
(2)	Condensed Quarterly Consolidated Statement of Income and Condensed Quarterly
	Consolidated Statement of Comprehensive Income ........................................................................	9
(3)	Condensed Quarterly Consolidated Statement of Changes in Equity ...........................................	11
(4)	Condensed Quarterly Consolidated Statement of Cash Flows ......................................................	15
(5)	Notes to Condensed Quarterly Consolidated Financial Statements ..............................................	17
	(Notes on premise of going concern) ...........................................................................................	17
	(Segment information)..................................................................................................................	17
3. Other.....................................................................................................................................................	22

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1. Qualitative Information on Financial Results for the Quarter under Review

1. Explanation on Operating Results
   In the cumulative third quarter under review, there were signs of a gradual recovery in the Japanese economy due to factors such as a significant decrease in new COVID-19 positives, but the economic outlook is uncertain due to the global spread of the Omicron variant since the end of last year.
   In the generic drug industry, while there is a strong demand for further improvement of quality and stable supply, the general framework of the drug price revision to be implemented in April 2022 is also being discussed, and it is necessary to improve profitability to respond to the lowering of drug prices.
   Under such circumstances, the Company is placing maximum focus on the resumption of manufacturing and shipments with security and trust at Toyama Plant 1, and is promoting initiatives aimed at improving and strengthening the manufacturing and quality control system throughout the entire company. Furthermore, discussions aimed at a specific alliance model including "planned ordering and planned production" have been underway with MEDIPAL HOLDINGS CORPORATION, which formed a capital and business alliance with the Company in September 2021.

1. Results by segment [Cumulative results]

	Nichi-Iko Group			Sagent Group
(in millions of yen)	Third quarter	Third quarter		Third quarter		Third quarter
of fiscal year	of fiscal year	Change	of fiscal year		of fiscal year	Change
	ended March	ending March	ended March		ending March
	31, 2021	31, 2022		31, 2021		31, 2022
Revenue	113,085	104,494	-8,590	26,151		30,414	+4,262
Core operating profit	3,820	-8,657	-12,478	-1,960		-1,250	+710

[Quarterly results]

		Nichi-Iko Group		Sagent Group
(in millions of yen)	Fiscal year ending March 31, 2022	Fiscal year ending March 31, 2022
First quarter		Second	Third quarter	First quarter	Second	Third quarter
		quarter	quarter
Revenue	33,268		32,345	38,880	9,690	10,625	10,098
Core operating profit	-3,521		-4,615	-519	-423	-229	-597

(Notes)

１． The two segments are the "Nichi-Iko Group" and the "Sagent Group," with the "Sagent Group" being made up of Sagent Pharmaceuticals, Inc. and its consolidated subsidiaries, and the "Nichi-Iko Group" being made up of companies excluding the "Sagent Group."

２． The Group has adopted "core operating profit" as an indicator representing ordinary profitability, and has also adopted "core operating profit" for segment profit. "Core operating profit" is calculated by deducting gains and losses caused by extraordinary factors from operating profit, and extraordinary factors are also excluded from revenue.

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