This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between this translated document and the Japanese original, the original shall prevail. The Company assumes no responsibility for this translation or for direct, indirect or any other forms of damages arising from the translation.

Summary of Consolidated Financial Results for the First Quarter of FY2024 (JGAAP)

(January 1, 2024 -March 31, 2024)

April 23, 2024

Company Name:

Shimano Inc.

Stock Exchange: Tokyo, Prime Market

Code Number:

7309

URL: https://www.shimano.com

Representative:

Taizo Shimano, President

Contact:

Takuma Kanai, Executive Officer, Supervising of ESG Development

Telephone: +81-72-223-3254

Dept., Corporate Governance Administration Dept. and

Accounting Dept.

Date of filing of quarterly report to Ministry of Finance:

May 10, 2024

Scheduled payment date for dividends: －

Supplemental information:

Yes

Financial results briefing:

No

(Amounts are rounded down to the nearest million yen.)

1. Consolidated financial results for the first quarter of FY2024 (January 1, 2024 - March 31, 2024)

(1) Consolidated income information

(The percentages represent the rates of increase (decrease) compared to the corresponding prior period.)

Net sales

Operating income

Ordinary income

Net income attributable

to owners of parent

Million yen

%

Million yen

%

Million yen

%

Million yen

%

First quarter of FY2024

100,557

(20.2)

13,421

(52.1)

28,852

0.9

23,687

17.2

First quarter of FY2023

126,071

(12.5)

28,009

(26.4)

28,596

(27.4)

20,203

(29.7)

(Note) Comprehensive income First quarter of FY2024: 51,576 million yen (73.6%)

First quarter of FY2023: 29,713 million yen (-46.5%)

Basic earnings

Diluted earnings

per share

per share

Yen

Yen

First quarter of FY2024

263.69

－

First quarter of FY2023

223.11

－

(2) Consolidated balance sheet information

Total assets

Net assets

Shareholders' equity

ratio

Million yen

Million yen

%

First quarter of FY2024

908,758

836,781

91.9

FY2023

871,731

802,396

91.9

(Reference) Shareholders' equity

First

quarter of FY2024: 835,574 million yen

FY2023: 801,166 million yen

2. Dividend information

Dividend per share

1st Quarter

2nd Quarter

3rd Quarter

Year-end

Total

Yen

Yen

Yen

Yen

Yen

FY2023

－

142.50

－

142.50

285.00

FY2024

－

FY2024 (Forecast)

142.50

－

142.50

285.00

(Note) Change in forecasted dividend during the period: None

3. Forecasted consolidated business performance for FY2024 (January 1, 2024 - December 31, 2024)

(The percentages represent the rates of increase (decrease) compared to the corresponding prior period.)

Net income

Basic earnings

Net sales

Operating income

Ordinary income

attributable to

per share

owners of parent

Million yen

%

Million yen

%

Million yen

%

Million yen

%

Yen

First half of FY2024

190,000

(27.8)

21,800

(59.6)

41,800

(38.9)

33,300

(33.9)

370.96

FY2024

420,000

(11.5)

56,800

(32.1)

86,800

(16.0)

66,300

8.4

738.59

(Note) Change in forecasted consolidated business performance during the period: Yes

*Notes

  1. Changes in significant subsidiaries during the period (Changes in specified subsidiaries due to changes in scope of consolidation): None
  2. Application of accounting treatment specific to preparation of quarterly consolidated financial statements: None
  3. Changes in accounting policies, changes in accounting estimates, and retrospective restatement

① Changes in accounting policies in accordance with revision of accounting standards:

None

② Changes in accounting policies other than ① above:

None

③ Changes in accounting estimates:

None

④ Retrospective restatement:

None

(4) Number of shares of common stock issued

①

Number of shares of common stock issued at period-end

First quarter of

89,822,000

FY2023

90,022,000

(including treasury stock):

FY2024

shares

shares

②

Number of shares of treasury stock at period-end:

First quarter of

56,057

FY2023

56,027

FY2024

shares

shares

③

Average number of shares during the period

First quarter of

89,832,613

First quarter of

90,553,130

(cumulative from the beginning of the fiscal year):

FY2024

shares

FY2023

shares

This quarterly financial report is outside the scope of quarterly review procedures by certified public accountants or audit corporations.

Explanation regarding the appropriate use of forecasts of business performance and other special items

The forecasts of consolidated business performance and other forward-looking statements contained in this document are based on information currently available to the Company and certain assumptions that management believes reasonable and actual business performance may differ materially from those described in such statements due to various factors. For details of assumptions for the forecasts and other related items, please refer to page 3 of the attached document. Shimano Inc. accepts no liability whatsoever for any direct or consequential loss arising from any use of this document.

Shimano Inc. (7309) Summary of Consolidated Financial Results for the First Quarter of FY2024

○Table of contents of the attached document

1. Qualitative Information on Consolidated Financial Performance for the Period under Review

2

(1)

Results of Operations

2

(2)

Financial Position

3

(3)

Forecast for the Fiscal Year Ending December 31, 2024

3

2. Consolidated Financial Statements and Primary Notes

4

(1)

Consolidated Balance Sheets

4

(2)

Consolidated Statements of Income and Comprehensive Income

6

(3)

Notes relating to Consolidated Financial Statements

8

(Note concerning Assumption of Going Concern)

8

(Note on Significant Change in the Amount of Shareholders' Equity)

8

(Segment Information)

9

1

Shimano Inc. (7309) Summary of Consolidated Financial Results for the First Quarter of FY2024

1. Qualitative Information on Consolidated Financial Performance for the Period under Review

  1. Results of Operations

During the first quarter of fiscal year 2024, the pace of global economic recovery was sluggish, dragged down by tight monetary policies adopted globally that had exerted impacts on economy in various countries, uncertain conditions in Ukraine and the Middle East, and a slowdown in economic recovery in China.

In Europe, hikes in energy costs and raw material prices showed signs of easing, but the economy remained lackluster due to the continued downturn in personal consumption.

In the U.S., despite the ongoing monetary tightening, the economy remained firm backed by strong employment and favorable income environment.

In China, consumer confidence waned due to the prolonged stagnation in the real estate market, and economic recovery slowed down.

In Japan, economic recovery remained somewhat sluggish with consumer behavior becoming increasingly budget-minded along with price hikes.

In this environment, demand for bicycles and fishing tackle continued to be weak, and for the first quarter of fiscal year 2024, net sales decreased 20.2% from the same period of the previous year to 100,557 million yen. Operating income decreased 52.1% to 13,421 million yen, ordinary income increased 0.9% to 28,852 million yen, and net income attributable to owners of parent increased 17.2% to 23,687 million yen.

Reportable Segment Overview

  • Bicycle Components

Interest in bicycles remained high as a long-term trend. On the other hand, supply and demand adjustments continued, and market inventories remained high globally.

Overseas, in the European market, the strong interest in bicycles continued in our major market, namely, Germany and Benelux countries. On the other hand, in other countries, market inventories remained high due to cooling consumer confidence on account of inflation and economic slowdowns.

In the North American market, although interest in bicycles was firm, retail sales of completed bicycles softened, and market inventories remained at a high level.

In the Asian, Oceanian and Central and South American markets, retail sales of completed bicycles were weak due to sluggish personal consumption on account of rising inflation and economic uncertainty, and market inventories were at a high level. In the Chinese market, aided by outdoor recreation boom, popularity of road bikes continued. As a result, retail sales of completed bicycles were favorable, and market inventories remained at an appropriate level.

In the Japanese market, retail sales were sluggish as affected by the soaring price of completed bicycles due to yen depreciation and pullbacks in consumer spending and market inventories remained high.

Under these market conditions, the Shimano Group received a favorable reception for its products, including SHIMANO 105 equipped with a twelve-speed derailleur, and a gravel-specific component

SHIMANO GRX.

As a result, net sales from this segment decreased 22.6% from the same period of the previous year to 76,090 million yen, and operating income decreased 52.7% to 10,471 million yen.

  • Fishing Tackle

Demand for fishing tackle that had been overly strong globally cooled down from the previous year. Although sales have been weak since then, adjustments to increased market inventories started to show signs of progress.

In the Japanese market, due to an adjustment of market inventories with stagnant demand, market conditions remained at a standstill, and sales were lackluster.

Overseas, in the North American market, while market inventories remained high, sales were favorable as demand increased compared to the previous year.

In the European market, sales were lackluster due to an adjustment of market inventories.

In the Asian market, market inventories remained high, and sales were weak due to cooling consumer confidence on account of economic stagnation.

In the Australian market, demand for fishing tackle increased, partially aided by stable weather conditions. As a result, market inventories remained at an appropriate level, and sales were strong.

Under these market conditions, order-taking was brisk for the new electric reels BEASTMASTER MD, the new spinning reels TWINPOWER, and the new rods POISON ADRENA.

As a result, net sales from this segment decreased 11.9% from the same period of the previous year to 24,369 million yen, and operating income decreased 49.8% to 2,961 million yen.

2

Shimano Inc. (7309) Summary of Consolidated Financial Results for the First Quarter of FY2024

  • Others

Net sales from this segment decreased 5.4% from the same period of the previous year to 97 million yen and operating loss of 11 million yen was recorded, following an operating loss of 8 million yen for the same period of the previous year.

  1. Financial Position
    Assets, Liabilities and Net Assets
    Total assets as of the end of the first quarter of fiscal year 2024 amounted to 908,758 million yen, an increase of 37,027 million yen compared with the figure as of the previous fiscal year-end. The principal factors included an increase of 12,653 million yen in cash and time deposits, an increase of 7,498 million yen in notes and accounts receivable-trade, an increase of 6,591 million yen in construction in progress, an increase of 3,140 million yen in buildings and structures, an increase of 2,954 million yen in investment securities, and an increase of 1,985 million yen in merchandise and finished goods.
    Total liabilities amounted to 71,977 million yen, an increase of 2,642 million yen compared with the figure as of the previous fiscal year-end. The principal factors included an increase of 2,798 million yen in income taxes payable, an increase of 2,263 million yen in accounts payable-trade, a decrease of 1,321 million yen in others under current liabilities, and a decrease of 939 million yen in provision for product warranties.
    Net assets amounted to 836,781 million yen, an increase of 34,384 million yen compared with the figure as of the previous fiscal year-end. The principal factors included an increase of 25,795 million yen in foreign currency translation adjustments, an increase of 6,640 million yen in retained earnings, and an increase of 1,892 million yen in unrealized gain (loss) on other securities.
  2. Forecast for the Fiscal Year Ending December 31, 2024

The consolidated business performance forecasts have been revised as follows in light of current trends in the first quarter of fiscal year 2024 where market inventories remained at a high level, and the outlook will remain uncertain. Despite such conditions, non-operating income was recorded due to the depreciation of Asian currencies caused by the stronger U.S. dollar, and gross profit increased due to positive effects produced by accelerated sales of some products that had been scheduled for the second quarter mainly in the Chinese market, where the popularity of road bikes continued, and to improvement in cost of sales ratio.

Revisions to consolidated business performance forecast figures for the first half of FY2024 (January 1, 2024 - June 30, 2024)

Net income

Basic earnings

Net sales

Operating income

Ordinary income

attributable to

per share

owners of parent

Million yen

Million yen

Million yen

Million yen

Yen

Previous forecast (A)

190,000

18,000

28,000

21,000

233.42

Revised forecast (B)

190,000

21,800

41,800

33,300

370.96

Difference (B-A)

－

3,800

13,800

12,300

Change (%)

－

21.1

49.3

58.6

First half results for FY2023

263,250

53,908

68,409

50,378

556.81

Revisions to consolidated business performance forecast figures for FY2024 (January 1, 2024 - December 31, 2024)

Net income

Basic earnings

Net sales

Operating income

Ordinary income

attributable to

per share

owners of parent

Million yen

Million yen

Million yen

Million yen

Yen

Previous forecast (A)

420,000

53,000

73,000

54,000

600.23

Revised forecast (B)

420,000

56,800

86,800

66,300

738.59

Difference (B-A)

－

3,800

13,800

12,300

Change (%)

－

7.2

18.9

22.8

Full year results for FY2023

474,362

83,653

103,369

61,142

676.77

3

Shimano Inc. (7309) Summary of Consolidated Financial Results for the First Quarter of FY2024

2. Consolidated Financial Statements and Primary Notes

(1) Consolidated Balance Sheets

(Millions of yen)

FY2023

First quarter of FY2024

As of Dec. 31, 2023

As of Mar. 31, 2024

Assets

Current

assets

Cash

and time

deposits

493,933

506,586

Notes and accounts receivable-trade

31,602

39,101

Merchandise and

finished

goods

74,293

76,278

Work in process

31,771

31,681

Raw

materials

and supplies

6,424

6,632

Others

15,071

16,332

Allowance for

doubtful accounts

(342)

(629)

Total

current assets

652,753

675,984

Fixed assets

Property, plant

and equipment

Buildings and

structures

(net)

76,763

79,903

Machinery and

vehicles

(net)

33,005

32,953

Land

14,317

14,486

Leased assets (net)

5,433

5,595

Construction

in progress

22,994

29,586

Others (net)

5,468

5,423

Total property, plant and equipment

157,982

167,948

Intangible assets

Goodwill

1,898

1,839

Software

13,225

14,059

Others

6,864

7,233

Total intangible assets

21,989

23,132

Investments and

other assets

Investment securities

23,781

26,735

Deferred income taxes

9,693

9,400

Net defined

benefit asset

2,804

2,826

Others

3,174

3,162

Allowance for

doubtful

accounts

(447)

(430)

Total investments and other assets

39,006

41,693

Total

fixed assets

218,977

232,774

Total assets

871,731

908,758

4

Shimano Inc. (7309) Summary of Consolidated Financial Results for the First Quarter of FY2024

(Millions of yen)

FY2023

First quarter of FY2024

As of Dec. 31, 2023

As of Mar. 31, 2024

Liabilities

Current liabilities

Accounts

payable-trade

11,025

13,289

Income taxes

payable

5,737

8,535

Accrued employee bonuses

3,041

2,847

Accrued

officer bonuses

141

51

Provision

for

product warranties

16,017

15,078

Others

25,870

24,548

Total current

liabilities

61,834

64,350

Long-term liabilities

Deferred

income taxes

3,179

3,148

Net defined benefit liability

1,253

1,314

Others

3,067

3,164

Total long-term liabilities

7,500

7,627

Total liabilities

69,334

71,977

Net assets

Shareholders' equity

Common stock

35,613

35,613

Capital surplus

5,640

5,640

Retained

earnings

647,172

653,813

Treasury

stock

(1,264)

(1,184)

Total shareholders' equity

687,162

693,882

Accumulated other comprehensive income

Unrealized gain (loss) on other securities

4,902

6,794

Foreign currency translation adjustments

109,101

134,897

Total accumulated other comprehensive income

114,003

141,691

Non-controlling

interests

1,230

1,207

Total net assets

802,396

836,781

Total liabilities

and

net assets

871,731

908,758

5

Shimano Inc. (7309) Summary of Consolidated Financial Results for the First Quarter of FY2024

  1. Consolidated Statements of Income and Comprehensive Income Consolidated Statements of Income

(Millions of yen)

First quarter of FY2023

First quarter of FY2024

Jan. 1, 2023 to

Jan. 1, 2024 to

Mar. 31, 2023

Mar. 31, 2024

Net sales

126,071

100,557

Cost

of

sales

73,770

61,513

Gross

profit

52,300

39,044

Selling, general and administrative expenses

24,290

25,623

Operating income

28,009

13,421

Non-operating income

Interest

income

3,924

5,907

Dividend income

219

109

Foreign

exchange gains

－

9,401

Others

163

314

Total non-operating income

4,306

15,733

Non-operating expenses

Interest

expenses

57

8

Foreign

exchange losses

3,076

－

Voluntary recall expenses

449

136

Others

137

157

Total non-operating expenses

3,720

301

Ordinary income

28,596

28,852

Extraordinary losses

Loss

on

factory reconstruction

196

60

Total

extraordinary losses

196

60

Income before income taxes

28,399

28,792

Income

taxes-current

7,293

5,679

Income

taxes-deferred

824

(675)

Total

income taxes

8,117

5,003

Net income

20,282

23,788

Net income attributable to non-controlling interests

78

100

Net income attributable to owners of parent

20,203

23,687

6

Shimano Inc. (7309) Summary of Consolidated Financial Results for the First Quarter of FY2024

Consolidated Statements of Comprehensive Income

(Millions of yen)

First quarter of FY2023

First quarter of FY2024

Jan. 1, 2023 to

Jan. 1, 2024 to

Mar. 31, 2023

Mar. 31, 2024

Net income

20,282

23,788

Other comprehensive income

Unrealized gain (loss) on other securities

(70)

1,892

Foreign currency translation adjustments

9,501

25,895

Total other comprehensive income

9,430

27,787

Comprehensive income

29,713

51,576

(Breakdown)

Comprehensive income attributable to owners of parent

29,575

51,375

Comprehensive income attributable to non-controlling interests

137

200

7

Shimano Inc. (7309) Summary of Consolidated Financial Results for the First Quarter of FY2024

(3) Notes relating to Consolidated Financial Statements

(Note concerning Assumption of Going Concern) Not applicable.

(Note on Significant Change in the Amount of Shareholders' Equity) (Acquisition of treasury stock)

The Company acquired 200,000 shares of common stock on February 27, 2024 through Off-auction Own Share Repurchase Trading (ToSTNeT-3) on the Tokyo Stock Exchange, based on the resolution of the Board of Directors meeting held on April 25, 2023. As a result, treasury stock increased by 4,147 million yen during the first quarter of fiscal year 2024, including the increase due to acquisition of fractional shares.

(Cancellation of treasury stock)

The Company canceled 200,000 shares of treasury stock on March 27, 2024 based on the resolution of the Board of Directors meeting held on March 19, 2024. As a result, retained earnings and treasury stock decreased by 4,227 million yen and 4,227 million yen, respectively, during the first quarter of fiscal year 2024.

8

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Shimano Inc. published this content on 23 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 23 April 2024 06:59:06 UTC.