(Tokyo Stock Exchange, First Section / Stock code: 3341)

Results of Operations for the Third Quarter of the Fiscal Year Ending March 31, 2022 (April 1, 2021

to December 31, 2021)

January 31, 2022

©︎2022 NIHON CHOUZAI Co., Ltd. All rights reserved.

1

Financial

Highlights

©︎2022 NIHON CHOUZAI Co., Ltd. All rights reserved.

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1

Financial Highlights

Consolidated

Results

Dispensing

Pharmacy

Business

Pharmaceutical

Manufacturing

and Sales

Business

Medical

Professional

Staffing and

Placement

Business

Sales and profits increased due to the expansion of the dispensing pharmacy business, but the bottom line declined due to the impact of the fire at the contract logistics center outsourced by the pharmaceutical manufacturing and sales business. The company expects to record insurance claim income by the end of the current fiscal year.

Sales and profit were up on the back of steady growth in prescription volumes, on top of contributions from 29 pharmacies opened in the previous fiscal year and 30 in the current fiscal year.

Drugs newly listed since FY3/20 drove higher sales. Profit was down due to product recalls over quality issues at Choseido Pharmaceutical and temporary suspension of business operations due to administrative disciplinary action.

Demand has dropped off for vaccination-related work, but the number of doctor placement contracts grew. Sales and operating profit were down due to lower temporary staffing and placements in the pharmacist business.

©︎2022 NIHON CHOUZAI Co., Ltd. All rights reserved.

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1

Financial Highlights

Consolidated Statement of Income

Despite the impact of COVID-19, sales and profit were up owing to robust performance in the Dispensing Pharmacy Business. However, an extraordinary loss related to fire damage caused the bottom line to decrease.

Vs.

3QFY3/20

3QFY3/21

3QFY3/22

3QFY3/22

ChangeVs.

YoYgrowth

Revised

Revised

Revised

（Millionsofyen）

Results

Results

Results

rate

Forecast

Forecast

Forecast

Net sales

199,040

208,337

220,800

223,439

2,639

1.2%

7.2％

Cost of sales

164,688

171,658

182,100

183,714

1,614

0.9%

7.0％

Gross profit

34,351

36,679

38,600

39,724

1,124

2.9%

8.3％

% to sales

17.3%

17.6％

17.5%

17.8％

―

―

―

SG&A expenses

28,719

30,911

34,000

33,897

(102)

(0.3%)

9.7％

% to sales

14.4%

14.8％

15.4%

15.2％

―

―

―

Consumption taxes

14,900

13

0.1%

11,452

13,665

14,913

9.1％

R&D expenses

2,110

2,039

2,400

2,475

75

3.2%

21.4％

Operating profit

5,632

5,767

4,600

5,827

1,227

26.7%

1.0％

% to sales

2.8%

2.8％

2.1%

2.6％

―

―

―

Ordinary profit

5,449

5,773

4,700

6,058

1,358

28.9%

4.9％

% to sales

2.7%

2.8％

2.1%

2.7％

―

―

―

Profit attributable to owners of

3,059

3,410

2,700

1,096

(1,603)

(59.4%)

(67.8％)

parent

% to sales

1.5%

1.6％

1.2%

0.5％

―

―

―

Net income per share (Yen)

102.03

113.74

90.04

36.57

(53.47)

(59.4%)

(67.8％)

Note

©︎2022 NIHON CHOUZAI Co., Ltd. All rights reserved.

Note ： On April 1, 2020, the Company conducted a two-for-one stock split of common stock.

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Net income per share has been calculated as if this stock split had taken place at the beginning of the fiscal year ended March 31, 2020.

1

Financial Highlights

Impact of Fire at a Contract Logistics Center

A fire at a contract logistics center in western Japan to which Nihon Generic outsources product warehousing operations damaged 34% of inventory.

  • Date and time of fire

Broke out around 8:50 a.m. November 29, 2021 Extinguished at 5:00 p.m. December 4, 2021 (Police/fire investigation is ongoing)

  • Damage
  • 34% of inventory, 1.4 months of sales
  • Distribution has returned to normal, mainly through a logistics center in eastern Japan.
  • Impact on financial results
  • Extraordinary loss of 3.91 billion yen recorded as "loss on disaster" in Q3 this year.
  • All of the products damaged by the fire were covered by insurance, and the Company expects to record insurance claim income by the end of the current fiscal year. The insurance company is in the process of finalizing the insurance claim amount, but we will promptly make an announcement should matters requiring disclosure arise.

©︎2022 NIHON CHOUZAI Co., Ltd. All rights reserved.

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NIHON CHOUZAI Co. Ltd. published this content on 31 January 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 31 January 2022 06:20:17 UTC.