Summary of Financial Statements
for Fiscal Year Ended March 31, 2022 [Japanese GAAP](Consolidated)
May 10, 2022
Name of listed company:

SHIP HEALTHCARE HOLDINGS, INC.
Shares listed on: Tokyo Stock Exchange
Code:
3360
URL
https://www.shiphd.co.jp/en/
Representative:(Title) President(Name) Futoshi Ohashi
Contact:(Title) Executive Director(Name) Hiroshi YokoyamaTel.: +81-6-6369-0130
Scheduled date for regular general meeting of shareholders: June 29, 2022
Scheduled start date for dividend payments: June 30, 2022
Scheduled date for filing securities report: June 29, 2022
Supplementary briefing materials on results: Y
Briefing on results: Y (for institutional investors and analysts)(All figures are rounded down to the nearest millions yen.)

1. Consolidated financial results for the fiscal year ended March 31, 2022
(April 1, 2021 – March 31, 2022)(1) Consolidated operating results
Net sales(Percentages represent year-on-year changes.)
Profit attributable toOrdinary profit
owners of parent

Operating profit(Millions yen)

% (Millions yen)

% (Millions yen)

514,353
20,505(5.9)
FY ended March 2022－
FY ended March 2021
497,156
2.6
21,80016.0
Note: Comprehensive income: FY ended March 2022: ¥ 11,061 million ((23.4) %);FY ended March 2021: ¥ 14,442 million (35.8 %)Net income per
Diluted net
Return on
share
income per shareequity
(Yen)

(Yen)

21,287
21,761% (Millions yen)

(2.2)
9.2

12,172
12,280Return on
assets
%

%

(0.9)
4.0

Operating margin%%

FY ended March 2022
129.01117.01
10.6
6.4
4.0
FY ended March 2021
129.99117.95
11.5
6.8
4.4
Reference: Share of profit (loss) of entities accounted for using equity method: FY ended March 31, 2022: ¥357 million;
FY ended March 31, 2021: ¥(40) million
Note1: As the Accounting Standard for Revenue Recognition (Accounting Standards Board of Japan (ASBJ) Statement No. 29,
March 31, 2020) and relevant revised ASBJ regulations have been applied from the beginning of this fiscal year, the figures
for the fiscal year ended March 31, 2022 are those after retrospectively applying the accounting standard and relevant revised
ASBJ regulations. Due to the above reason, YoY rate of change in net sales for the fiscal year ended March 31, 2022 are notshown.
Note2: The company executed a two-for-one common stock split, effective on April 1, 2021. “Net income per share” and “Diluted
net income per share” are calculated as if the relevant stock split was executed at the beginning of the previous consolidated
fiscal year ended March 31, 2021.

(2) Consolidated financial condition
Total assets(Millions yen)

Net assets(Millions yen)

Equity capital ratio

Net assets per share
%

(Yen)

FY ended March 2022
335,074
122,31835.3
1,253.73
FY ended March 2021
334,498
115,10333.3
1,181.14
Reference: Equity: FY ended March 2022: ¥118,289 million; FY ended March 2021: ¥111,440 million
Note: The company executed a two-for-one common stock split, effective on April 1, 2021. “Net assets per share” are calculated as if
the relevant stock split was executed at the beginning of the previous consolidated fiscal year ended March 31, 2021.

(3)

Consolidated cash flows
Net cash from operating Net cash from investing Net cash from financing
activities
activities
activities

FY ended March 2022
FY ended March 2021

Cash and cash
equivalents at end of
period(Millions yen)

(Millions yen)

(Millions yen)

(Millions yen)

12,428
19,772(3,870)(19,289)(8,842)(10,465)

72,804
72,9502. Dividends
End Q1

Annual dividends
End Q2End Q3Year-end

(Yen)

(Yen)

(Yen)

Total annual
dividends

Payout ratio(consolidated)

Dividends to net
assets(consolidated)(Yen) (Millions yen)

%

%

Total

(Yen)

FY ended March 2021
–
0.00
–
80.00
80.00
3,774
30.8
3.5
FY ended March 2022
–
0.00
–
41.00
41.00
3,868
31.8
3.4
FY ending March 2023
–
0.00
–
42.00
42.00
31.7
(projected)
Note: The company executed a two-for-one common stock split, effective on April 1, 2021. Annual dividends for the year ended
March 31, 2021 are actual amounts paid prior to the relevant stock split. Annual dividends for the year ended March 31,2022
and Forecasted annual dividends for the year ending March 31, 2023 are the amount after the relevant stock split.

3. Forecast of consolidated financial results for the fiscal year ending March 31, 2023
(April 1, 2022 – March 31, 2023)
Net sales
Cumulative throughsecond quarter
Full-year

Operating profit(Percentages represent changes from previous year.)
Profit attributable to Net income per
Ordinary profit
owners of parent
share(Millions yen)
(Yen)
% (Millions yen)%

(Millions yen)%

(Millions yen)%

250,000

6.5

7,500

(1.2)

7,500

1.7

4,500

9.3

47.69

560,000

8.9

21,0002.4

21,000(1.4)

12,5002.7

132.49

Notes(1) Changes made in significant subsidiaries during consolidated cumulative quarter under review:(2) Changes made in accounting policies, accounting estimates, and/or restatements:(i) Changes in accounting policies associated with changes in accounting standards, etc.:(ii) Any changes in accounting policies other than those under (i) above:(iii) Changes in accounting estimates:(iv) Restatements:(3) Number of shares issued and outstanding (common stocks)(i) Number of shares issued and outstanding
FY ended Marchat the end of the period (including treasury 2022
stock)(ii) Number of treasury stock at the end of the FY ended March
2022
period(iii) Average number of shares during the
FY ended March
2022
period

None
Yes
None
None
None

101,669,400 shares

FY ended March
2021

101,669,400 shares

7,319,116 shares

FY ended March
2021

7,319,054 shares

94,350,306 shares

FY ended March
2021

94,470,499 shares

Note: The company executed a two-for-one common stock split, effective on April 1, 2021. “Number of shares issued andoutstanding at the end of the period”, “Number of treasury stock at the end of the period”, and “Average number of shares
during the period” are calculated as if the relevant stock split was executed at the beginning of the previous consolidated fiscal
year ended March 31, 2021.

Reference: Overview of non-consolidated financial results
1. Non-consolidated financial results for fiscal year ended March 31, 2022 (April 1, 2021–March 31, 2022)(1) Non-consolidated operating results(Percentages represent year-on-year changes.)
Net sales
FY ended March 2022
FY ended March 2021

Operating profit

Ordinary profit

Net income(Millions yen)%

(Millions yen)%

(Millions yen)%

(Millions yen)

%

8,075
7,657

5.5
6.5

6,237
6,377

(2.2)
10.6

6,270
6,214

0.9
7.4

6,173
6,137

0.6
8.8

Net income per share

Diluted net income per
share

(Yen)

(Yen)

FY ended March 2022
65.43
59.27
FY ended March 2021
64.97
58.87
Note: The company executed a two-for-one common stock split, effective on April 1, 2021. “Net income per share” and “Diluted net
income per share” are calculated as if the relevant stock split was executed at the beginning of the previous consolidated fiscal
year ended March 31, 2021.
(2) Non-consolidated financial condition
Total assets(Millions yen)

Net assets(Millions yen)

Equity capital ratio

Net assets per share
%

(Yen)

FY ended March 2022
83,21948,63458.4
515.46
FY ended March 2021
85,527
48,39556.6
512.93
Reference: Equity: FY ended March 31, 2022: ¥ 48,634 million; FY ended March 31, 2021: ¥ 48,395 million
Note: The company executed a two-for-one common stock split, effective on April 1, 2021. “Net assets per share” are calculated as if
the relevant stock split was executed at the beginning of the previous consolidated fiscal year ended March 31, 2021.

* This summary of financial results is not subject to quarterly review by a Certified Public Accountant or an audit firm.
* Information on appropriate use of financial forecasts and other special notes:• The forecasts of financial results and other forward-looking statements provided herein are based on information available at thetime this document was prepared and certain assumptions considered reasonable. Actual results may differ significantly fromforecasts due to various factors. For assumptions underlying forecasts of financial results, notes on use of forecasts of financial
results, and other related information, please refer to “Future outlook” on page 5 of the Annexed Materials.
• The Company is a holding company and the bulk of its revenue consists of dividends received from subsidiaries and revenues fromtheir operating costs. Detailed information on non-consolidated financial forecasts is omitted since information is not important forinvestment information and business indicators.

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

 Index of attached materials

1. Qualitative information on quarterly results ..................................................................................................... 2

2.

(1)

Description of business results ................................................................................................................ 2(2)

Analysis of financial position .................................................................................................................. 3(3)

Analysis of cash flows ........................................................................................................................... 4(4)

Future outlook ......................................................................................................................................... 5

Basic approach in selecting accounting standards ............................................................................................ 5

3. Consolidated financial statements and notes thereto ........................................................................................ 6(1)

Consolidated balance sheet ...................................................................................................................... 6(2)

Consolidated statement of income and consolidated statement of comprehensive income ..................... 8(3)

Consolidated statements of changes in shareholders' equity ................................................................... 10(4)Consolidated statement of cash flows ..................................................................................................... 12(5)

Notes on consolidated financial statements ............................................................................................ 14(Notes on the going concern assumption) ............................................................................................... 14(Changes in accounting policy) .............................................................................................................. 14(Changes in presentation method) .......................................................................................................... 14(Segment information, etc.) .................................................................................................................... 15(Per-share information) ........................................................................................................................... 20(Important subsequent information)........................................................................................................ 21

1

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

1. Qualitative information on business results(1) Description of business results
The Japanese economy during FY ended March 2022 showed signs of recovery with the progress of vaccinations under
the long-running effect of COVID-19, however the outlook for the global economy remains uncertain due to the re-spreadof COVID-19 caused by the new variant ‘omicron’ in January 2022, in addition, geopolitical risks surrounding the tense
situation in Ukraine, rising raw fuel prices and interest rates, shortages of electrical components, and the trends offinancial measures and exchange rate.
Healthcare industry in which the Group operates, although the impact of the infectious diseases is easing, the provision ofregular medical care remained restrained due to continued restrictions on medical treatment and postponement of surgeries
because of COVID-19. On the other hand, new initiatives beyond the conventional framework, such as remote diagnosis
using DX, etc., have emerged.
Under such conditions, the Group's business performance declined due to more small-sized projects in Total Pack Produce
business than in previous years, difficulties in procuring electronic components and plastic vinyl products for
manufacturer business that we had to temporarily postpone new contracts, and the impact of a reactionary decline indemand for infection control products.
For FY ending March 2022, the various factors noted above resulted in net sales of 514,353 million yen (previous
consolidated FY was 497,156 million yen), operating profit of 20,505 million yen (down 5.9% YoY), ordinary profit of
21,287 million yen (down 2.2% YoY), and profit attributable to owners of the parent of 12,172 million yen (down 0.9%
YoY).
Accounting Standard for Revenue Recognition (ASBJ Statement No.29, March 31,2020) have been applied from the
beginning of the current fiscal year. Due to the application, the explanation regarding business results does not include theYoY comparison (%) concerning net sales since the accounting method is different from the consolidated cumulative
period for the previous fiscal year. For details, please refer to “3. Consolidated financial statements and notes thereto (5)Notes on consolidated financial statements (Segment information, etc.)”.
Business results by segment are summarized below.
The Company has changed the classification of reportable segments from this consolidated fiscal year. Comparison andanalysis with the previous fiscal year are based on the classification after the change.
(i) Total Pack Produce businessIn Total Pack Produce business, the business performance declined due to the fact that most of the project projects thatreached completion year were medium to small in scale, the impact of order adjustments due to tight procurement ofelectrical component parts by manufacturers, and the impact of a reactionary decline in demand for infection control
products using subsidies for measures against COVID-19. On the other hand, we were newly commissioned toprovide a variety of service businesses for countermeasures against COVID-19, including the development andoperation of the Osaka Corona Large-Scale Medical and Medical Care Center. In Overseas business, the medical
equipment sales business in the Republic of the Union of Myanmar, despite the impact of the lockdown due to
COVID-19, military coup, and financial sanctions by the U.S. and Europe, the results were generally as planned.
As a result, this segment recorded net sales of 99,539 million yen (previous consolidated FY was 104,355 million yen)and segment profit (operating profit) of 9,265 million yen (down 5.3% YoY).
(ii) Medical Supply business
In Medical Supply business, although the impact of restrictions on medical treatment at medical institutions
continued, the number of SPD contracts continue to increase, and the new medical material logistics base "Osaka
Solution Center" is now in full-scale operation. On the other hand, profits decreased due to a reactionary decline indemand for infectious disease control products and delays in delivery of some products.
As a result, this segment recorded net sales of 360,635 million yen (previous consolidated FY was 341,157 million
yen) and segment profit (operating profit) of 6,209 million yen (down 10.8% YoY).
(iii) Lifecare business
In Lifecare business, the occupancy rate remained high thanks to the use of our detailed information sharing system,
which connects residents and their families via the Internet as an infection control measures. Also, the businessperformance was firm with increase of three facilities through M&A and the number of contract customers in thefood supply business, and because the hydroponics which is an employment support business for people withhandicaps got on track.
As a result, this segment recorded net sales of 25,247 million yen (previous consolidated FY was 24,571 million yen)and segment profit (operating profit) of 2,407 million yen (up 7.6% YoY).
(iv) Dispensing Pharmacy business
In Dispensing Pharmacy business, the number of consultations has been on a recovery trend compared to previous
fiscal year, and new store openings and small M&A contributed to the solid business performance although there wassome influence due to the public drug price revision.
As a result, this segment recorded net sales of 28,930 million yen (previous consolidated FY was 27,070 million yen)and segment profit (operating profit) of 3,200 million yen (up 11.0% YoY)2

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

(2) Analysis of Financial Position(i) Current assets
The balance of current assets at the end of this consolidated fiscal year stood at 226,529 million yen (vs. a balance of
221,890 million yen at the end of the previous consolidated fiscal year), an increase of 4,638 million yen since theend of the previous consolidated fiscal year.
Major reasons included increases of 2,638 million yen in merchandise and finished goods and 640 million yen inelectronically recorded monetary claims-operating and decrease of 759 million yen in allowance for doubtful
accounts, despite decrease of 688 million yen in short-term loans receivable.
(ii) Non-current assets
The balance of non-current assets at the end of this consolidated fiscal year stood at 108,545 million yen (vs. abalance of 112,607 million yen at the end of the previous consolidated fiscal year), a decrease of 4,062 million yen
since the end of the previous consolidated fiscal year.
Major reasons included decreases of 2,517 million yen in investment securities, 1,268 million yen in goodwill, and
1,380 million yen in construction in progress, despite increases of 783 million yen in buildings and structures.
(iii) Current liabilities
The balance of current liabilities at the end of this consolidated fiscal year stood at 148,371 million yen (vs. a balanceof 151,942 million yen at the end of the previous consolidated fiscal year), a decrease of 3,571 million yen since theend of the previous consolidated fiscal year.
Major reasons included decreases of 2,137 million yen in notes and accounts payable – trade, 2,118 million yen incurrent portion of long-term loans payable, despite increase of 1,153 million yen in short-term loans payable.
(iv) Non-current liabilities
The balance of non-current liabilities at the end of this consolidated fiscal year stood at 64,384 million yen (vs. abalance of 67,451 million yen at the end of the previous consolidated fiscal year), a decrease of 3,066 million yen
since the end of the previous consolidated fiscal year.
Major reasons included decrease of 2,750 million yen in long-term loans payable and 254 million yen in deferred tax
liabilities.
(v) Net assets
The balance of net assets at the end of this consolidated fiscal year stood at 122,318 million yen (vs. a balance of
115,103 million yen at the end of the previous consolidated fiscal year), an increase of 7,214 million yen since theend of the previous consolidated fiscal year.
Major reasons included an increase 12,172 million yen in retained earnings from profit attributable to owners ofparent, despite decrease of 3,774 million yen in retained earnings due to payment of dividends and 2,420 million yen
in valuation differences on available-for-sale securities.

3

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

(3) Analysis of cash flows
The balance of cash and cash equivalents at the end of this consolidated fiscal year stood at 72,804 million yen, decrease 146
million yen from the balance of 72,950 million yen at the end of the previous consolidated fiscal year.
(i) Cash flow from operating activities
Cash flow provided from operating activities was 12,428 million yen (down 7,343 million yen compared to theprevious consolidated fiscal year). Major contributing factors included the recording of 20,804 million yen in profit
before income taxes and 3,609 million yen in depreciation and amortization, despite payment of 9,170 million yen inincome taxes, increase of 3,325 million yen in inventories, and decrease of 1,645 million yen in notes and accounts
payable - trade.
(ii) Cash flow from investing activities
Cash flow expensed in investing activities was 3,870 million yen (down 15,419 million yen compared to the previous
consolidated fiscal year). Major contributing factors included expenditures of 3,124 million yen on purchase ofproperty, plant, and equipment and 346 million yen on purchase of intangible assets.
(iii) Cash flow from financing activities
Cash flow expensed in financing activities was 8,842 million yen (up 1,623 million yen compared to the previous
consolidated fiscal year). Major contributing factors included expenditures of 6,056 million yen on repayment oflong-term loans payable and 3,774 million yen on cash dividends paid, despite proceeds of 1,014 million yen fromshort-term loans payable.
Reference: Trends in cash flow indices
FY ended
March 2018
Equity capital ratio (%)

FY ended
March 2019

35.0

FY ended
March 2020

31.9

Mark-to-market equity
66.5
72.3
capital ratio (%)
Years of debt redemption
2.3
6.9(years)Interest coverage ratio
80.6
40.9
(times)* Equity capital ratio = equity capital/total assets
Mark-to-market equity capital ratio = total market capitalization/total assets
Years of debt redemption = interest-bearing debt/operating cash flows
Interest coverage ratio = operating cash flows/interest paid

FY ended
March 2021

FY ended
March 2022

33.0

33.3

35.3

67.9

87.7

56.0

2.9

3.4

5.1

89.4

61.1

43.7

Notes:
1. All indices are calculated from consolidated-basis financial data.
2. Total market capitalization is calculated by multiplying the closing stock price at the end of the fiscal year by total numberof shares issued and outstanding (after subtracting treasury stock) as of the end of the fiscal year.
3. Calculations of operating cash flows are based on cash flows from operating activities on the Consolidated Cash Flow
Statement. Interest-bearing debt consists of all debt on the Consolidated Balance Sheet for which interest is paid. The
amount of interest paid is based on interest paid as shown on the Consolidated Cash Flow Statement.

4

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

(4) Future outlook
As the baby boom generation ages and low birth rates continue, projections indicate Japan will continue to see restraints
on remuneration for medical and nursing care costs, and reductions in their price. In addition, since the enactment of the
Act for Securing Comprehensive Medical and Long-term Care in the Community, progress is being made to develop
comprehensive community care systems through continuing reforms in the structure of providing medical care, withcompletion envisioned for 2025.
Given these conditions and drawing on advanced capabilities in providing comprehensive and optimal solutions inmedical, healthcare, welfare, nursing care, and services, the Group will seek to contribute to society by meeting a wide
range of needs based on the SHIP philosophy and Group mission to “Creating environments for medical professionals”.
The business performance projected for the next fiscal year (FY ending March 2023) is summarized below. The items
described in "Important subsequent information" are reflected in the earnings forecast.
<Projected consolidated results>
FY ending March 2023 (projected)
Profit margin

YoY change(Unit: Millions yen, %)FY ended March 2022 (actual)
Profit margin

Net sales

560,000–

8.9

514,353–

Operating profit

21,0003.8

2.4

20,505

4.0

Ordinary profit

21,0003.8(1.4)

21,287

4.1

12,172

2.4

Profit attributable to owners
12,5002.2
2.7
of parent
The projected amount of (year-end) dividends per share in FY ending March 2023 is 42 yen.

2. Basic approach in selecting accounting standards
To facilitate comparisons from period to period and between entities, the Group for the time being will continue to prepare
its consolidated financial statements based on J-GAAP.
The Group will duly address the application of International Financial Reporting Standards (IFRS) after taking into accountvarious circumstances both in Japan and abroad.

5

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

3. Consolidated financial statements and notes thereto(1) Consolidated balance sheet(Unit: Millions yen)
Fiscal year ended
March 31, 2022

Fiscal year ended
March 31, 2021
AssetsCurrent assets
Cash and deposits
Notes receivable - trade
Accounts receivable - trade
Notes and accounts receivable - trade
Electronically recorded monetary claims - operating
Lease investment assets
Merchandise and finished goods
Work in process
Raw materials and supplies
Short-term loans receivable
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant, and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Machinery, equipment and vehicles
Accumulated depreciation
Machinery, equipment and vehicles, net
Land
Real estate for rent
Accumulated depreciation
Real estate for rent, net
Construction in progress
Other
Accumulated depreciation
Other, net
Total property, plant, and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Long-term loans receivable
Net defined benefit asset
Deferred tax assets
Claims provable in bankruptcy, claims provablein rehabilitation and other
Guarantee deposits
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets
6

73,907－－
113,720
4,080
3,349
16,139
1,893
691
2,406
7,356
(1,654)
221,890

73,8082,163
109,399
－
4,720
3,634
18,778
2,317
1,010
1,718
9,872
(895)
226,529

34,378(14,917)
19,4618,039(2,704)
5,335
15,947
14,599(3,691)
10,9072,629
12,863(9,203)
3,659
57,941

36,716(16,470)
20,245
8,195(3,448)
4,746
16,293
14,895(3,902)
10,993
1,249
14,560(10,092)
4,468
57,995

9,604
976
10,581

8,336
1,017
9,354

26,125
7,655
936
3,443

23,608
7,518
1,012
3,184

65

86

6,509
1,088
(1,739)44,085
112,607334,498

6,260
1,266
(1,741)
41,195
108,545
335,074SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

Fiscal year ended
March 31, 2021
Liabilities
Current liabilities
Notes and accounts payable - trade
Electronically recorded obligations - operating
Short-term loans payable
Current portion of long-term loans payable
Income taxes payable
Provision for bonuses
Other
Total current liabilities
Non-current liabilities
Bonds with share acquisition rights
Long-term loans payable
Net defined benefit liability
Deferred tax liabilities
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders' equity
Accumulated other comprehensive income
Valuation differences on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

7(Unit: Millions yen)
Fiscal year ended
March 31, 2022

102,20921,481
1,248
5,926
6,168
2,508
12,400151,942

100,071
22,173
2,401
3,807
4,980
2,461
12,473
148,371

25,06632,721
2,902
1,652
849
4,260
67,451
219,394

25,041
29,970
2,938
1,397
873
4,162
64,384
212,756

15,55323,891
83,565(15,526)
107,483

15,55323,90891,964(15,526)
115,899

3,923
0
68
(35)
3,957
3,663
115,103
334,498

1,503
1
842
44
2,390
4,028
122,318
335,074SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

(2) Consolidated statement of income and consolidated statement of comprehensive income
Consolidated statement of income

Net sales
Cost of sales
Gross profit
Sales, general, and administrative expenses
Directors’ compensation
Salaries and allowances
Bonuses
Retirement benefit expenses
Provision for bonus
Other
Total sales, general, and administrative expenses
Operating profit
Non-operating profit
Interest income
Dividend income
Equity gains of affiliated companies
Reversal of allowance for doubtful accounts
Foreign exchange profit
Other
Total non-operating profit
Non-operating expenses
Interest expenses
Equity losses of affiliated companies
Foreign exchange loss
Provision for doubtful accounts
Commission paid
Other
Total non-operating expenses
Ordinary profit
Extraordinary profit
Gains on sales of non-current assets
Gains on sales of investment securities
Other
Total extraordinary profit
Extraordinary losses
Losses on step acquisitions
Losses on sales of non-current assets
Losses on retirement of non-current assets
Impairment loss
Other
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

8

Fiscal year ended
March 31, 2021
497,156442,670
54,486(Unit: Millions yen)
Fiscal year ended
March 31, 2022
514,353
460,70953,643

1,507
10,968
1,445
431
1,147
17,18532,68521,800

1,521
11,223
1,325
458
1,004
17,60533,13820,505

313
281
－
－
119
714
1,430

289
211
357
270
－
344
1,473

325
40
－
631
219
251
1,468
21,761

283
－
284
32
43
46
691
21,287

5
27
2
35

1
1
0
3

92
6
148
271
42
561
21,235
8,975
(102)
8,873
12,362
82
12,280

－
1
243
241
0
486
20,804
7,921
496
8,418
12,385
213
12,172SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

Consolidated statement of comprehensive income
Fiscal year ended
March 31, 2021
12,362

Net income
Other comprehensive income
Valuation differences on available-for-sale securities
1,904
Foreign currency translation adjustments
285
Remeasurements of defined benefit plans(107)
Share of other comprehensive income of entities accounted for using equity method(2)
Total other comprehensive income
2,079
Comprehensive income
14,442(Breakdown)Comprehensive income attributable to owners of parent
14,295Comprehensive income attributable to non-controlling interests
146

9(Unit: Millions yen)
Fiscal year ended
March 31, 2022
12,385(2,420)
1,016
84
(4)
(1,323)
11,061
10,605455

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

(3) Consolidated statement of changes in shareholders' equity
Previous consolidated fiscal year (April 1, 2020–March 31, 2021)(Unit: Millions yen)
Shareholders’ equity
Capital stock
Balance at beginning of current
periodCapital surplus

15,553Retained earnings

23,895

Treasury stock

74,841(14,447)

Total shareholders’equity99,841

Changes of items during period
Dividends of surplus(3,556)(3,556)

Profit attributable toowners of parent

12,28012,280Purchase of treasury stock(1,078)Change of scope of
consolidation(1,078)(4)(4)

Capital increases by
consolidated subsidiaries－

Net changes of items otherthan shareholders’ equity
Total changes of items during
periodBalance at end of current
period

－

(4)

8,724

(1,078)

7,641

15,55323,891

83,565(15,526)

107,483

Accumulated other comprehensive income

Balance at beginning of current
periodValuation difference
Differed gains or
on available-for-salelosses on hedges
securities

Foreign currencytranslation
adjustments

Remeasurementsof defined benefit
plans

Total accumulated
othercomprehensive
income

－

(152)

75

1,942

2,019

Noncontrollinginterests

2,897

Total net assets

104,681

Changes of items during period
Dividends of surplus(3,556)

Profit attributable toowners of parent

12,280Purchase of treasury stock(1,078)Change of scope of
consolidation(4)

Capital increases by
consolidated subsidiaries－

Net changes of items otherthan shareholders’ equity

1,904

0

220

(110)

2,014

765

2,780

Total changes of items during
period

1,904

0

220

(110)

2,014

765

10,422

Balance at end of current
period

3,923

0

68

(35)

3,957

3,663

115,103

10

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

This consolidated fiscal year (April 1, 2021–March 31, 2022)(Unit: Millions yen)
Shareholders’ equity
Capital stock
Balance at beginning of current
periodCapital surplus

15,553Retained earnings

23,891

Treasury stock

83,565(15,526)

Total shareholders’equity107,483

Changes of items during period
Dividends of surplus(3,774)(3,774)

Profit attributable toowners of parent

12,172

12,172

Purchase of treasury stock

(0)

(0)

Change of scope of
consolidation－

Capital increases by
consolidated subsidiaries

17

17

Net changes of items otherthan shareholders’ equity
Total changes of items during
periodBalance at end of current
period

－

17

8,398

(0)

8,415

15,55323,90891,964(15,526)

115,899

Accumulated other comprehensive income
Valuation difference
Differed gains or
on available-for-salelosses on hedges
securities

Balance at beginning of current
period3,923

Foreign currencytranslation
adjustments

Remeasurementsof defined benefit
plans

Total accumulated
othercomprehensive
income

68

(35)

3,957

0

Noncontrollinginterests

3,663

Total net assets

115,103

Changes of items during period
Dividends of surplus(3,774)

Profit attributable toowners of parent

12,172

Purchase of treasury stock(0)

Change of scope of
consolidation－

Capital increases by
consolidated subsidiaries

17

Net changes of items otherthan shareholders’ equity(2,420)

0

773

79

(1,566)365(1,200)Total changes of items during
period(2,420)

0

773

79

(1,566)

365

7,214

Balance at end of current
period

1,503

1

842

44

2,390

4,028

122,318

11

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

(4) Consolidated statement of cash flows(Unit: Millions yen)
Fiscal year ended
March 31, 2022

Fiscal year ended
March 31, 2021
Cash flows from operating activities
Income before income taxes
Depreciation and amortization
Impairment loss
Amortization of goodwill
Share of loss (profit) of entities accounted for using equity method[( ) represents profit]
Increase (decrease) in provision for bonuses[( ) represents decrease]
Increase (decrease) in allowance for doubtful accounts[( ) represents decrease]
Increase (decrease) in lease investment assets[( ) represents increase]
Increase (decrease) in net defined benefit liability[( ) represents decrease]
Loss on retirement of property, plant, and equipment
Loss on retirement of intangible assets
Interest and dividend income
Interest expenses
Decrease (increase) in notes and accounts receivable – trade[( ) represents increase]
Decrease (increase) in inventories[( ) represents increase]
Increase (decrease) in notes and accounts payable – trade[( ) represents decrease]
Other
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes paid
Cash flows from operating activities

12

21,235
3,170
271
1,957

20,804
3,609
241
1,879

40

(357)

312

(66)

1,498

(159)

151

(285)

(36)

117

21
127
(595)
325

243
0
(500)
283

(12,344)(97)(1,679)(3,625)

11,598(1,645)704
26,757642(323)(7,304)544
21,283599(284)(9,170)19,772

12,428SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

(Unit: Millions yen)
Fiscal year ended
March 31, 2022

Fiscal year ended
March 31, 2021
Cash flows from investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of property, plant, and equipment
Proceeds from sales of property, plant, and equipment
Purchase of intangible assets
Payments of short-term loans receivableCollection of short-term loans receivable
Payments of long-term loans receivableCollection of long-term loans receivable
Purchase of investment securities
Proceeds from sales and redemption of investment securities
Purchase of shares of subsidiaries and associates
Purchase of shares of subsidiaries resulting in change inscope of consolidation
Proceeds from purchase of shares of subsidiaries resulting
in change in scope of consolidation
Other
Cash flows from investing activities
Cash flows from financing activities
Net increase (decrease) in short-term loans payable[( ) represents decrease]
Proceeds from long-term loans payable
Repayments of long-term loans payable
Purchase of treasury stock
Cash dividends paid
Dividends paid to non-controlling shareholders
Payments from changes in ownership interests in subsidiaries that do
not result in change in scope of consolidation
Repayments of lease obligations
Other
Cash flows from financing activities
Effect of exchange rate change on cash and cash equivalents
Increase (decrease) in cash and cash equivalents[( ) represents decrease]
Cash and cash equivalents at the beginning of the period
Cash and cash equivalents from newly consolidated
subsidiaries
Cash and cash equivalents at the end of the period

13

(218)
167
(4,632)
499
(378)
(849)
241
(143)
266
(408)
140
(9,797)(185)
146(3,124)
70
(346)
(401)
330
(220)
269
(15)
1
(121)

(4,122)

(216)

－

24

(54)
(19,289)(83)(3,870)(2,542)

1,014

1,586
(4,555)(1,078)(3,556)(69)

299(6,056)(0)(3,774)
(16)

－

(48)

(248)
0
(10,465)
123

(249)
(11)
(8,842)130(9,859)(154)

82,81072,950－8

72,95072,804SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

(5) Notes on consolidated financial statements(Notes on the going concern assumption)
Not applicable(Change in accounting policy)(Application of Accounting Standard for Revenue Recognition, etc.)
The Accounting Standard for Revenue Recognition (ASBJ Statement No.29, March 31,2020; hereinafter, "AccountingStandard for Revenue Recognition") has been applied from the beginning of the current consolidated fiscal year. In
accordance with the Accounting Standard for Revenue Recognition, when control of a promised goods and/or service istransferred to the customer, revenue will be recognized for the amount expected to be received in exchange for the good
and/or service. As a result, for transactions for which our role in providing products to customers is an agent, mainly forrevenues related to product sales in Medical Supply business, the Company has changed to a method of recognizing
revenue with the net amount obtained by deducting the amount paid to the supplier of the product from the amountreceived from the customer although the Company previously recognized the total amount received from customers asrevenue.
When applying the Accounting Standard for Revenue Recognition, the Company comply with the transitional treatment
stipulated in the proviso of article 84 of Accounting Standard for Revenue Recognition. The cumulative impact ofretroactively applying the new accounting policy prior to the beginning of the current fiscal year is added or subtracted to
the retained earnings at the beginning of the current fiscal year and the new accounting policy is applied from the
beginning balance.
As a result, net sales and cost of sales for the current consolidated cumulative period decreased by 4,889million yen,respectively. However, there is no cumulative impact on net assets at the beginning of the current consolidated fiscal year,
so there is no impact on the beginning balance of retained earnings for the current consolidated fiscal year. For the impact
on segment information, please refer to “3. Consolidated financial statements and notes thereto (5) Notes on consolidated
financial statements (Segment information, etc.)”.
Due to the application of Accounting Standard for Revenue Recognition, "Notes and accounts receivable" recorded in"Current assets" in the consolidated balance sheet for the previous consolidated fiscal year will be included in “Notes
receivable - trade”, “Accounts receivable - trade”, and “Other” from the current consolidated fiscal year. In accordancewith the transitional treatment stipulated in article 89-2 of the Accounting Standard for Revenue Recognition, the previous
consolidated fiscal year has not been reclassified using the new recording method.
(Application of accounting standards related to fair value measurement, etc.)
The Accounting Standard for Fair Value Measurement (ASBJ Statement No.30, July 4, 2019; hereinafter, "AccountingStandard for Fair Value Measurement") has been applied from the beginning of the current consolidated fiscal year. In
accordance with transitional treatment stipulated in the provision of paragraph 19 in Accounting Standards for Fair Value
Measurement and article 44-2 in Accounting Standard for Financial Instruments (ASBJ Statement No. 10, July 4, 2019),
new accounting policy under Accounting Standards for Fair Value Measurement will be applied in the future. There is no
impact on the consolidated financial statements.
(Changes in presentation method)
Since the "subsidy income" of "non-operating income" posted independently in the previous consolidated fiscal year isless important, it is included in "Other" from the current consolidated fiscal year. In order to reflect this change inpresentation method, the consolidated financial statements for the previous consolidated fiscal year have been
reclassified.
As a result, in the consolidated income statement for the previous consolidated fiscal year, "subsidy income" of 298
million yen and "Other" of 416 million yen, which were stated in "non-operating income", are now reclassified as "Other"of 714 million yen.

14

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

(Segment information, etc.)[Segment information]
1

Overview of reportable segments
The Company’s reportable segments are Company components for which separate financial information is available andsubject to periodic review by the Board of Directors in determining the allocation of management resources and evaluating
business performance.
The Company classifies its business divisions by service. The Company formulates comprehensive strategies reflecting thenature of the activities of each business division and subsidiary and undertakes business activities based on these strategies.
Accordingly, the Company organizes its segments based on its business divisions. Its four reportable segments are the Total
Pack Produce business, the Medical Supply business, the Life Care business, and the Dispensing Pharmacy business.
The Total Pack Produce segment engages in sales of medical devices and medical equipment based on bulk orders; consulting
on topics including medicine, healthcare, welfare, and nursing care facilities; and leasing of real estate to medical facilities
and other tenants. The Medical Supply segment engages in sales of medical examination and treatment materials and special
treatment materials. The Life Care segment operates homes for senior citizens, group homes, and other facilities andnutritional services. The Dispensing Pharmacy segment operates dispensing pharmacies, among other business activities.
From the current fiscal year, due to the change in management accounting categories, The Company has changed theclassification of reportable segments, such as including businesses that were previously included in "Other" into "Total Pack
Produce Business". The segment information for the previous consolidated fiscal year is created according to the changedclassification.

2

Methods for calculating net sales, profit (loss), assets, and other amounts by reportable segment
The accounting methods for reportable segments are same as those outlined under “Significant Matters that Serve as the Basisfor Preparation of Consolidated Financial Statements.”
Reportable segment profit figures are based on operating profit. Intersegment revenues and transfers are based on market
prices.
As described in the change in accounting policy, the accounting method for revenue recognition was changed due to the
Accounting Standard for Revenue Recognition that has been applied from the beginning of the current consolidated fiscal
year, the company has also changed the method of calculation profit or loss for business segments. As a result of this change,
sales to external customers in the “Medical Supply Business” segment for the current consolidated fiscal year have decreasedby ¥ 4,889 million compared to the previous method. Although the internal sales or transfers between segments of the“Dispensing Pharmacy Business” segment for the current consolidated fiscal year decreased by ¥ 30,958 million in the sameway, this event has no effect on the amount recorded in the consolidated income statement

15SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

3

Net sales, profit (loss), assets, and other amounts by reportable segment
Previous consolidated fiscal year (April 1, 2020–March 31, 2021)(Unit: Millions yen)
Adjustments*1

Amountrecorded on
consolidated
financialstatements*2

Reportable segment
Total Pack
Producebusiness

MedicalSupplybusiness

Dispensing
Pharmacybusiness

Lifecarebusiness

Subtotal

Net sales(1) Sales to outside
customers(2) Intersegment sales ortransfers

104,355

341,157

24,571

27,070497,156－

497,156

3,658

3,203

228

27,41034,501(34,501)－

108,014344,361

24,80054,481

531,657(34,501)

497,156

Segment profit

9,781

6,958

2,237

2,884

21,861(61)

21,800

Segment assets

118,465

143,889

34,44925,753

322,557

11,940334,498

1,608

578

622

283

3,093

77

3,170

Amortization of
goodwill

484

532

401

538

1,957

－

1,957

Impairment loss

－

209

33

27

271

－

271

Subtotal

Other items
Depreciation

Investment in entities
393
9,621
10,015
10,015－－－accounted for using
equity method
Increase in property,
plant, and equipment,
1.202
2,986
295
375
4,860
91
4,951
and intangible fixed
assets
Notes:
1. The amounts of the various adjustments are described below.
(1) The figure of (61) million yen in adjustments to segment profit includes (78) million yen for the cancellation ofintersegment transactions and 0 million yen for companywide costs not allocated to an individual reportable segment.
These companywide costs consist mainly of parent company operating expenses and sales, general, and administrative
expenses not attributable to individual reportable segments.
(2) The figure of 11,940 million yen in adjustments to segment assets includes (19,293) million yen for cancellation ofintersegment transactions, and 31,690 million yen for companywide assets not allocated to an individual reportablesegment. These companywide assets consist mainly of assets related to administrative sections not attributable toindividual reportable segments.
(3) The figure of 91 million yen in adjustments to increase in property, plant, and equipment, and intangible fixed assets
consists mainly of capital investment related to administrative sections not attributable to individual reportablesegments.
2. Segment profit is adjusted against the operating profit reported on the consolidated statement of income.

16

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

Consolidated fiscal year under review (April 1, 2021–March 31, 2022)(Unit: Millions yen)
Adjustments*1

Amountrecorded on
consolidated
financialstatements*2

Reportable segment
Total Pack
Producebusiness

MedicalSupplybusiness

Dispensing
Pharmacybusiness

Lifecarebusiness

Subtotal

Net sales(1) Sales to outside
customers(2) Intersegment sales ortransfers

99,539360,635

25,24728,930514,353－514,353

2,176

1,256

188

101

3,724

(3,724)－

101,716

361,892

25,43629,032

518,077(3,724)514,353

Segment profit

9,265

6,209

2,407

3,200

21,082(577)

20,505

Segment assets

121,743

144,820

34,75527,629328,947

6,127

335,074

Subtotal

Other items
Depreciation

1,628

955

646

314

3,545

63

3,608

Amortization of
goodwill

503

411

408

556

1,879

－

1,879

Impairment loss

－

241

－

－

241

－

241

Investment in entities
560
9,803
10,363
10,363－－－
accounted for using
equity method
Increase in property,
plant, and equipment,
1,326
712
499
491
3,029
205
3,235
and intangible fixed
assets
Notes:
1. The amounts of the various adjustments are described below.
(1) The figure of (577) million yen in adjustments to segment profit includes (73) million yen for the cancellation ofintersegment transactions and (509) million yen for companywide costs not allocated to an individual reportablesegment. These companywide costs consist mainly of parent company operating expenses and sales, general, andadministrative expenses not attributable to individual reportable segments.
(2) The figure of 6,127 million yen in adjustments to segment assets includes (19,662) million yen for cancellation ofintersegment transactions, and 26,538 million yen for companywide assets not allocated to an individual reportablesegment. These companywide assets consist mainly of assets related to administrative sections not attributable toindividual reportable segments.
(3) The figure of 205 million yen in adjustments to increase in property, plant, and equipment, and intangible fixed assets
consists mainly of capital investment related to administrative sections not attributable to individual reportablesegments.
2. Segment profit is adjusted against the operating profit reported on the consolidated statement of income.

17

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

[Related information]
Previous consolidated fiscal year (April 1, 2020–March 31, 2021)
1

Product and service-specific information
This information is reported under segment information and is therefore omitted here.

2

Region-specific information(1) Net sales
This information is omitted because sales to external customers in Japan account for more than 90% of net sales on theConsolidated Statement of Income.
(2) Property, plant, and equipment
This information is omitted because property, plant, and equipment located in Japan account for more than 90% of
property, plant, and equipment on the Consolidated Balance Sheet.

3

Information concerning key individual customers
Not applicable because sales to no single external customer account for 10% or more of net sales on the Consolidated
Statement of Income.
This consolidated fiscal year (April 1, 2021–March 31, 2022)

1

Product and service-specific information
This information is reported under segment information and is therefore omitted here.

2

Region-specific information(1) Net sales
This information is omitted because sales to external customers in Japan account for more than 90% of net sales on theConsolidated Statement of Income.
(2) Property, plant, and equipment
This information is omitted because property, plant, and equipment located in Japan account for more than 90% of
property, plant, and equipment on the Consolidated Balance Sheet.

3

Information concerning key individual customers
Not applicable because sales to no single external customer account for 10% or more of net sales on the Consolidated
Statement of Income.

[Information concerning impairment losses on fixed assets per reportable segment]
Previous consolidated fiscal year (April 1, 2020–March 31, 2021)
This information is reported under segment information and is therefore omitted here.
This consolidated fiscal year (April 1, 2021–March 31, 2022)
This information is reported under segment information and is therefore omitted here.

18

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

[Information concerning amounts of amortization of goodwill and remaining unamortized balances, per reportable segment]
Previous consolidated fiscal year (April 1, 2020–March 31, 2021)(Unit: Millions yen)Companywide/cancellation

Reportable segment
Total Pack
Producebusiness

MedicalSupplybusiness

Lifecarebusiness

Dispensing
Pharmacybusiness

Total

Subtotal(Goodwill)
3,997
1,943
2,226
1,436
9,604
－
9,604
Ending balance
Note: Amounts of amortization of goodwill is omitted because similar information is reported under segment information.
This consolidated fiscal year (April 1, 2021–March 31, 2022)(Unit: Millions yen)Companywide/cancellation

Reportable segment
Total Pack
Producebusiness

MedicalSupplybusiness

Lifecarebusiness

Dispensing
Pharmacybusiness

Total

Subtotal(Goodwill)
3,991
1,424
1,946
974
8,336
8,336
－
Ending balance
Note: Amounts of amortization of goodwill is omitted because similar information is reported under segment information.
[Information on gains on bargain purchases per reportable segment]
Previous consolidated fiscal year (April 1, 2020–March 31, 2021)
No important gains on bargain purchases occurred.
This consolidated fiscal year (April 1, 2021–March 31, 2022)
No important gains on bargain purchases occurred.

19

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

(Per-share information)
Fiscal year ended
March 31, 2021

Fiscal year ended
March 31, 2022
(Yen)

(Yen)

Net assets per share

1,181.14

1,253.73

Net income per share

129.99129.01

Diluted net income per share

117.95117.01

Notes:
1. The company executed a two-for-one common stock split, effective on April 1, 2021. “Net assets per share”, “Net income
per share”, and “Diluted net income per share” are calculated as if the relevant stock split was executed at the beginning of
the previous consolidated fiscal year ended March 31, 2021.
2. “Net income per share” and “Diluted net income per share” are calculated based on the following information:
Account

Fiscal year ended
March 31, 2021

Fiscal year ended
March 31, 2022

Net income per share
Profit attributable to owners of parent(millions yen)

12,28012,172－－

12,28012,172

94,470,499

94,350,306

Adjustment for profit attributable to owners ofparent (millions yen)

(16)

(16)

[Interest income (after tax equivalentdeduction) (millions yen)][(17)][(17)]

Increase in number of common stock(shares)

9,503,636

9,529,091[Bonds with share acquisition rights included inabove (shares)][9,503,636][9,529,091]

Amount not attributable to owners ofcommon stock (millions yen)
Profit attributable to owners of parent related tocommon stock (millions yen)
Average shares of common stock during theperiod (shares)
Diluted net income per share

Description of potentially dilutive commonshares not included in the computation ofdiluted earnings per share because of their antidilutive effect––

3. Net assets per share were calculated based on the following information:
Account

Fiscal year ended
March 31, 2021

Total net assets (millions yen)

Fiscal year ended
March 31, 2022
115,103

122,318

Amount subtracted from total net assets(millions yen)

3,663

4,028

[Non-controlling interests included in above(millions yen)][3,663][4,028]Ending balance of net assets related to common
stock (millions yen)

111,440

118,289

Ending number of shares of common stock usedin calculation of net assets per share (shares)

94,350,346

94,350,284

20SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2022

(Important subsequent information)(Business combination through acquisition)
At a meeting of the Board of Directors held on April 27, 2022, the Company resolved to acquire shares of Kingrun Co.,
Ltd. and made into an affiliate, also entered into a share transfer agreement on the same date.
1.

Overview of the business combination(1) Name and business of the acquired company
Name of the acquired company: Kingrun Co., Ltd.
Business: Curtain leasing and sales business for medical institutions and nursing care facilities, comprehensive
support business for furniture, fittings, and facilities, cleaning business, renovation business, welfare vehicle
sales business, nursing care facility management business, food supply business, agricultural business, energy
conservation business(2) Principal purpose of the business combination
The company's product capabilities and extensive customer base are expected to create synergies for the entire
group, including the Total Pack Produce business, and further enhance the corporate value.
(3) Date of the business combination
July 1, 2022 (scheduled)(4) Legal form of the business combination
Acquisition of shares for consideration of cash(5) Name following the business combination
Kingrun Co., Ltd.
(6) Ratio of voting rights acquired
Ratio of voting rights held immediately prior to acquisition: 14.9%
Ratio of voting rights to be acquired on the date of the business combination: 83.1%
Ratio of voting rights after the acquisition: 98.0%(7) Grounds for deciding on the company to be acquired
The Group's mission is "Creating environment for medical professionals" under the management philosophy of"SHIP" (Sincere (heart of sincerity), Humanity (heart of humanity), Innovation (spirit of innovator), andPartnerSHIP (spirit of partnership)). Based on the above philosophy, the Group has set "Medical", "Health","Nursing", "Welfare", and "Services" as its business domains, and mainly develops Total Pack Produce Business(comprehensive provision of consulting services to medical institutions, manufacturing, sales, and leasing of
medical equipment and facilities, and real estate leasing to medical institutions), Medical Supply Business (salesof medical consumables and equipment), Lifecare Business (operation of nursing care homes and group homes,
food supply, and rehabilitation support service), and Dispensing Pharmacy Business (operation of dispensing
pharmacies).
Kingrun Co., Ltd. and its subsidiaries are the pioneers in the curtain leasing and sales business for medical
institutions and nursing care facilities, and are also engaged in other businesses such as comprehensive support
for furniture, fittings, and facilities, cleaning business, renovation business, welfare vehicle sales business,
nursing care facility management business, food supply business, etc., and their strength lies in building mediumto long-term relationships with medical institutions and nursing care facilities nationwide through these wideranging business.
Kingrun Co., Ltd. and its subsidiaries’ product capabilities and extensive customer base are expected to createsynergies for the entire group, including the Total Pack Produce business, and further enhance the corporate
value.

2.

Acquisition Cost and Consideration of Acquired Company by Item3.

Consideration for acquisition: Cash
Acquisition cost:
Description and amount of major acquisition-related expenses

8,708 million yen
8,708 million yen

Advisory cost, etc. (approximation): 330 million yen
4.

Amount of goodwill generated, grounds for generation, amortization method and amortization period
Not confirmed at the present moment.

5.

Breakdown of principal amounts of assets to be acquired and liabilities assumed on the date of the businesscombination
Not confirmed at the present moment.

21