Financial Results Summary for the Six-Month Period Ended September 30, 2021 [Japanese GAAP](Consolidated)
October 29, 2021
Company Name:
Securities Code:
Representative:
Contact:

Fukoku Co., Ltd.
5185
(Title)President(Title)General Manager of Finance
Department

Exchange listed on:
Tokyo Stock Exchange
URL
https://www.fukoku-rubber.co.jp/(Name) Takashi Ogawa(Name) Norio Nakatsugawa(TEL) 048-615-4400

Scheduled date for submission of quarterly report:

Scheduled commencement date of dividends payment:
Preparation of supplementary materials for quarterly report
Convening quarterly results briefing

November 12, 2021
December 6, 2021

:
:

Yes
Yes (For institutional investors and analysts)(Amounts rounded down to the nearest millions of yen.)

1.

Consolidated Financial Results for the Six-Month Period Ended September 30, 2021 (From April 1, 2021 toSeptember 30, 2021)(1) Consolidated Operating Results (cumulative)(Percentages represent year-on-year changes.)
Net sales
Six-month period ended
September 30, 2021
Six-month period ended
September 30, 2020
(Note) Comprehensive income:Operating profit

Ordinary profit

Profit attributable to ownersof parent%
million yen%

million yen%

million yen%

million yen

36,650

-

1,820

-

2,125

-

1,611

-

28,408

-25.3

-899

-

-525

-

-451

-

Six-month period ended September
30, 2021
2,568 million yen
Six-month period ended September
30, 2020-1,434 million yen

( -%)
( -%)

Profit per share –dilutedyen

Profit per shareyen
Six-month period ended
97.12
September 30, 2021
Six-month period ended-27.27
September 30, 2020
(Note) The Company adopted the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020), etc., at the beginning of
the first quarter of the fiscal year ending March 2022. Since this change affects net sales figures, year-on-year changes in net sales for the six-month
period ended September 30, 2021, are not shown here.

(2) Consolidated Financial Positions
Total assets
Six-month period ended
September 30, 2021
Fiscal year ended March 2021
(Reference) Shareholders’ equity:2.

Net assets
million yen%

64,58634,44649.9

32,32147.1

63,817Six-month period ended September
30, 2021
32,217 million yen
Fiscal year ended March 2021
30,085 million yen

Dividends
End of Q1

Annual dividends
End of Q3
yen-

End of Q2
yen
-

yen
0.00

Fiscal year ended March 2021
Fiscal year ending March
29.00
2022
Fiscal year ending March2022 (forecast)(Note) Revision of the consolidated results forecast released most recently
: Yes

3.

Shareholders’ equity ratio

million yen

End of Q4

-

Total
yen
22.00

yen
22.00

20.00

49.00

Forecast of Consolidated Results for the Fiscal Year Ending March 2022 (from April 1, 2021 to March 31, 2022)
Net sales
million yen

Operating profit%

million yen

Profit attributable toProfit per shareowners of parent

Ordinary profit%

million yen%

million yen%

yen

Full year
73,000
3,720
3,900
2,450
147.75(Note 1) Revision of the consolidated results forecast released most recently: None(Note 2) Due to the adoption of the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020), etc.,
beginning in the first quarter of the fiscal year ending March 2022, the above consolidated results forecasts were preparedusing the said accounting standard. Thus no year-on-year changes are stated.

*

Notes
(1)

Changes in major subsidiaries during the period under review: None(Change in specific subsidiaries that will accompany a change in scope of consolidation)(2) Adoption of special accounting procedures used in preparation of the quarterly: Yes
consolidated financial statements(Note) For details, please see “2. Quarterly Consolidated Financial Statements and Key Notes, (3) Notes to quarterly
consolidated financial statements (Adoption of special accounting procedures used in preparation of the quarterly
consolidated financial statements)” on Page 8 of the attachments.
(3) Change in accounting policies or estimates and retrospective restatements(i) Change in accounting policies in accordance with revision of accounting standards:: Yes(ii) Change in accounting policies other than item i) above: None(iii) Change in accounting estimates: None(iv) Retrospective restatements: None(4)

Number of shares issued (common shares)(i)

Number of shares issued at the end of theperiod (including treasury shares)(ii)

Number of treasury shares at the end of theperiod(iii) Average number of shares issued during theperiod (cumulative from the beginning of the
fiscal year)**

Q2 of fiscal
year ending
March 2022
Q2 of fiscal
year ending
March 2022
Q2 of fiscal
year ending
March 2022

17,609,130
shares1,013,432
shares
16,589,034
sharesFiscal year
ended March
2021
Fiscal year
ended March2021
Q2 of fiscal
year ended
March 2021

17,609,130
shares
1,026,754
shares
16,569,402
sharesQuarterly financial results are not subject to quarterly reviews by a Certified Public Accountant or audit firm.

Explanation of appropriate use of operating results forecasts and other special notes
Any statement on the future such as outlook for financial results included in this material is based on information the Company
presently has and certain assumptions the Company considers reasonable, and the Company does not intend to be committed to
its realization. In addition, actual financial results may significantly differ due to various factors. For assumptions for operating
results forecasts and points to consider in utilizing them, please see “1. Qualitative Information on Quarterly Financial Results
under Review, (3) Explanation of future forecast information such as consolidated financial results forecasts” on Page 3 of theattachments.
* This document is an English translation of a statement initially written in Japanese. The Original Japanese document should beconsidered as the primary version.

 Table of Contents of Attachments

1. Qualitative Information on Quarterly Financial Results under Review ············································· 2(1) Explanation of operating results ··························································································· 2(2) Explanation of financial position ·························································································· 2(3) Explanation of future forecast information such as consolidated financial results forecasts ··················· 3
2. Quarterly Consolidated Financial Statements and Key Notes ························································ 4(1) Quarterly consolidated balance sheet ····················································································· 4(2) Quarterly consolidated statement of income and quarterly consolidated statement of comprehensive income 6(Quarterly consolidated statement of income)(Six-month period) ········································································································ 6(Quarterly consolidated statement of comprehensive income)(Six-month period) ········································································································ 7(3) Notes to quarterly consolidated financial statements ································································· 8(Notes to assumptions for going concerns) ··············································································· 8(Notes when there is a significant change in the amount of shareholders’ equity) ································ 8(Adoption of special accounting procedures used in preparation of the quarterly consolidated
financial statements) ······································································································· 8(Change in accounting policies)···························································································· 8(Additional information) ···································································································· 8(Segment information) ······································································································ 9

1. Qualitative Information on Quarterly Financial Results under Review(1) Explanation of operating results
During the six month period under review, the global economy saw signs of the spread of COVID-19 infections settling down to a certain
degree, but with the period under review nearing the end, the automotive industry, where the Group has major customers, effected production
adjustments in the face of supply chain disruptions due to the impact of COVID-19 infections and shortages of semiconductors. Moreover,surges in raw material prices and transportation costs pushed up manufacturing costs.
Working against this backdrop, the Group saw the strong flow of orders that took place in 1Q lose momentum slightly, and consolidated net
sales increased 29.0% year on year to 36,650 million yen. The Company doubled down on various improvements, such as streamlining
manufacturing processes and enhancing efficiency in indirect operations. As a result, operating profit totaled 1,820 million yen (up from a lossof 899 million yen for the same period last year), ordinary profit totaled 2,125 million yen (up from a loss of 525 million yen for the same
period last year), and profit attributable to owners of parent totaled 1,611 million yen (compared to a loss of 451 million yen for the same
period last year). While net sales decreased 868 million yen due to the adoption of the Accounting Standard for Revenue Recognition (ASBJ
Statement No. 29, March 31, 2020; hereinafter the “Revenue Recognition Accounting Standard”), etc., the effects of this change on profit/loss
were insignificant.
The Group’s business performance by segment is as follows.

Functional Parts BusinessNet sales increased 36.7% year on year, totaling 16,531 million yen as orders remained firm in general in Japan and overseas. Segment
income rose 388.7% year on year to 1,996 million yen as a result of structural reforms, including the streamlining of production and cost
cutting, in addition to sales growth. While net sales fell 124 million yen due to the adoption of the Revenue Recognition Accounting Standard,etc., it did not affect segment income.

Anti-Vibration Parts BusinessNet sales rose 29.3% year on year to total 13,937 million yen as orders steadily recovered. Segment income was up 783.6% year on year tototal 821 million yen thanks to increased sales as well as structural reforms focusing on streamlining production, cutting costs, etc. While net
sales decreased 87 million yen due to the adoption of the Revenue Recognition Accounting Standard, etc., the effect on segment income wasinsignificant.

Metal BusinessNet sales dropped 2.8% year on year to total 2,682 million yen. A segment loss of 43 million yen (which was a loss of 226 million yen for thesame period last year) was posted due to a rise in materials for metal parts and a delay in structural reforms. While net sales fell 657 million
yen due to the adoption of the Revenue Recognition Accounting Standard, etc., it did not affect segment income.

Hose BusinessNet sales increased 38.4% year on year to total 2,350 million yen as orders steadily recovered. Segment income surged from a loss of 51
million for the same period of the previous year to total 102 million yen due to increased net sales.

Industrial Equipment BusinessNet sales increased 10.8% year on year to total 1,474 million yen as orders steadily recovered. Segment income increased 191.9% year on
year to total 286 million yen due to increased net sales.

(2) Explanation of financial position
Total assets as of the end of the second quarter under review were 64,586 million yen, up 768 million yen over the end of last fiscal year.
Current assets increased 749 million yen over the end of last fiscal year to total 36,968 million yen. This increase is primarily attributable toincreases in cash and deposits.
Non-current assets rose 18 million yen over the end of last fiscal year to total 27,617 million yen.
Liabilities totaled 30,139 million yen, a decrease of 1,356 million yen compared to the end of last fiscal year. This decrease is primarily
attributable to the repayment of short-term borrowings.
Net assets totaled 34,446 million yen, an increase of 2,125 million yen over the end of last fiscal year. This is primarily due to increases inretained earnings and foreign currency translation adjustments.
As a result, the shareholders’ equity ratio came to 49.9%, up 2.8 percentage points over the end of last fiscal year.

(3) Explanation of future forecast information such as consolidated financial results forecasts
The Company is determined to step up measures, including streamlining and enhancing efficiency, to lower the breakeven point in an all-out
effort to secure profits, although there are concerns over the future such as production adjustments by automobile manufacturers that are ourcustomers due to shortages of semiconductors and surges in raw material prices and transportation costs. Therefore, the forecast figures forthe consolidated results for the fiscal year ending March 2022, announced on July 28, 2021, will remain unchanged.
Regarding the dividend forecast for the fiscal year ending March 2022, the actual results exceeded the earnings forecast in the six-month
period under review, so the Company increased 4 yen per share from the latest dividend forecast at the end of the second quarter to 29 yen per
share and kept the year-end dividend unchanged at 20 yen per share for a total of 49 yen per share for the fiscal year ending March 2022. For
more information, see the notice dated October 29, 2021, regarding the dividends forecast (interim dividend).
The above forecasts represent the Company’s best judgment based on information currently available. Actual results may vary from the above
forecasts due to various factors.

2. Quarterly Consolidated Financial Statements and Key Notes(1) Quarterly consolidated balance sheet(Million yen)Previous fiscal year
(March 31, 2021)

Second quarter under review(September 30, 2021)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade

8,992
18,713

9,743
17,426Merchandise and finished goods
Work in process

3,990
1,060

4,723
1,210

Raw materials and supplies
Other

2,200
1,299

2,556
1,347

-37

-38

36,21836,968

7,235

7,880

Machinery, equipment and vehicles, net
Land

10,040
5,806

9,936
5,838

Other, net

2,101

1,462

Total property, plant and equipment

Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net

25,184

25,117

Intangible assets

784

788

Investments and other assets
Investment securities

745

758

Other
Allowance for doubtful accounts

898
-13

967
-13

Total investments and other assets

1,629

1,712

27,59927,617

63,81764,586

Total non-current assets
Total assets

(Million yen)Previous fiscal year
(March 31, 2021)

Second quarter under review(September 30, 2021)

Liabilities
Current liabilities
Notes and accounts payable - trade
Electronically recorded obligations - operating

4,460
4,733

4,463
4,959

Short-term borrowings
Income taxes payable

8,751
209

7,991
364

Provision for bonuses
Other

798
4,317

920
4,301

Total current liabilities

23,27023,002

Non-current liabilities
Long-term borrowings

3,338

2,489

2,296

2,363

144

140

2,446

2,143

Retirement benefit liability
Provision for retirement benefits for directors (andother officers)
Other
Total non-current liabilities

8,225

7,137

31,49630,139

Share capital
Capital surplus

1,395
1,571

1,395
1,572

Retained earnings
Treasury shares

28,315-933

29,561-921

Total shareholders' equity

Total liabilities
Net assets
Shareholders’ equity

30,34831,608

Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges

109

98

1

-18

Foreign currency translation adjustment

-374

528

-262

608

Non-controlling interests

Total accumulated other comprehensive income

2,235

2,229

Total net assets

32,321

34,446

63,81764,586

Total liabilities and net assets

(2) Quarterly consolidated statement of income and quarterly consolidated statement of comprehensive income(Quarterly consolidated statement of income)(Six-month period)(Million yen)

Net sales

Six-month period in the previous
fiscal year
(From April 1, 2020
to September 30, 2020)
28,408Six-month period under review(From April 1, 2021
to September 30, 2021)
36,650

Cost of sales

25,134

30,110Gross profit

3,274

6,539

Selling, general and administrative expenses

4,174

4,719

Operating profit (loss)

-899

1,820

Non-operating income
Interest income

25

12

71

3

Dividend income
Share of profit of entities accounted for using equity
methodForeign exchange gains
Subsidies for employment adjustment

0

3

321

98
2

Gain on sale of non-current assets
Other

4
110

201
94

Total non-operating income

534

415

Interest expenses
Foreign exchange losses

62
56

51
-

Loss on sale of non-current assets
Loss on retirement of non-current assets

36

33
19

Non-operating expenses

Other
Total non-operating expenses
Ordinary profit (loss)
Extraordinary income
Gain on sale of investment securities
Total extraordinary income
Extraordinary losses
Loss on valuation of investment securities

6

5

160

110

-525

2,125

-

8

-

8

16

-

Total extraordinary losses

16-

Profit (loss) before income taxes

-542

2,134

Income taxes - current

194

502

Income taxes - deferred

-194

0

-0

502

Profit (loss)

-541

1,631

Profit (loss) attributable to non-controlling interests

-89

20

Profit (loss) attributable to owners of parent

-451

1,611

Total income taxes

(Quarterly consolidated statement of comprehensive income)(Six-month period)(Million yen)

Profit (loss)
Other comprehensive income

Six-month period in the previous
fiscal year
(From April 1, 2020
to September 30, 2020)-541

Six-month period under review(From April 1, 2021
to September 30, 2021)
1,631Valuation difference on available-for-sale securities
Deferred gains or losses on hedges

6
-0

-11
-22

Foreign currency translation adjustment
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income

-887

938

-10

31

-892

936

Comprehensive income-1,434

2,568

Profit attributable toComprehensive income attributable to owners ofparentComprehensive income attributable to non-controllinginterests-1,241

2,482

-192

85

(3) Notes to quarterly consolidated financial statements(Notes to assumptions for on going concerns)
Not applicable.

(Notes when there is a significant change in the amount of shareholders’ equity)
Not applicable.

(Adoption of special accounting procedures used in preparation of the quarterly consolidated financial statements)(Calculation of tax expenses)
With respect to tax expenses incurred by some consolidated subsidiaries, the Company reasonably estimated the effective tax
rate after applying tax effect accounting to profit before income taxes in the fiscal year, including the second quarter underreview, and calculated them by multiplying this estimated effective tax rate by profit before income taxes.

(Change in accounting policies)(Adoption of Accounting Standard for Revenue Recognition)
The Company adopted the “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29, March 31, 2020.
hereinafter the “Revenue Recognition Accounting Standard”), etc., at the beginning of the first quarter of the fiscal year
ending March 2022. Under this standard, revenue is recognized when control of promised goods or services is transferred tothe customer, in the amount expected to be received in exchange for the goods or services.
The major change is that in the case of transactions, where the Company processes raw materials bought from a customer
and then sells them back to that customer, the Company now recognizes the net amount of payment received from thecustomer minus the purchase price of raw materials as revenue, whereas previously the Company would recognize the total
amount of payment including the purchase price of raw materials as revenue.
In addition, for transactions in which the Company's role in selling products to customers falls under the category of agent,
the Company previously recognized revenue based on the total amount of payment received from the customer, but haschanged to a method of recognizing revenue based on the net amount of such total payment minus the amount paid to third
parties.
The Company has applied the Revenue Recognition Accounting Standard, etc., in accordance with the transitional treatment
provided in the proviso of Paragraph 84 of the Guidance on Accounting Standard for Revenue Recognition. After the
cumulative effects of retrospectively applying the new accounting policy prior to the beginning of the first quarter of the
fiscal year ending March 2022 were added to or subtracted from the beginning balance of retained earnings, the Company
began using the new accounting policy starting with the beginning balance of the current fiscal year. However, while theCompany applied the policy set forth in Paragraph 86 of the Revenue Recognition Accounting Standard, it did not apply the
new accounting policy retrospectively to contracts in which almost all of the revenue amounts were recognized using theprevious accounting practice prior to the beginning of the first quarter of the fiscal year ending March 2022. Using themethod specified in the additional provision (1) of Paragraph 86 of the Revenue Recognition Accounting Standard, theCompany accounted for contract changes made prior to the beginning of the first quarter of the fiscal year ending March2022 based on the contract terms after reflecting all contract changes, and added or subtracted the cumulative effects of suchchanges on retained earnings at the beginning of the first quarter of the fiscal year ending March 2022.
As a result, net sales and cost of sales for the six-month period under review decreased 868 million yen and 867 million yen
respectively. The effects on operating profit, ordinary profit, and profit before income taxes were insignificant. The effects
on the beginning balance of retained earnings were also insignificant.
In accordance with the transitional treatment specified in Paragraph 89-2 of the Revenue Recognition Accounting Standard,
the prior year's consolidated financial statements have not been reclassified to conform to the new presentation.
(Adoption of Accounting Standard for Fair Value Measurement)
The Company adopted the Accounting Standard for Fair Value Measurement (ASBJ Statement No. 30, July 4, 2019);
hereinafter the “Fair Value Measurement Accounting Standard”), etc., at the beginning of the first quarter of the fiscal year
ending March 2022. In accordance with the transitional treatment specified in Paragraph 19 of the Fair Value AccountingStandard and Paragraph 44-2 of the Accounting Standard for Financial Instruments (ASBJ Statement No. 10, July 4, 2019),
the Company applies the new accounting policies set forth in the Fair Value Accounting Standard prospectively. The
adoption of the new accounting standard had no effect on quarterly consolidated financial statements.
(Additional information)(Accounting estimates on the impact of COVID-19)
There have been no significant changes to the assumptions and accounting estimates regarding the impact of COVID-19
described under “Critical Accounting Estimates” in the annual securities report for the previous fiscal year.

(Segment information)
Segment information
I. Six-month period in the previous fiscal year (from April 1, 2020 to September 30, 2020)
1. Information on net sales, income or loss by reporting segment
Reporting segment
Functional Anti-Vibration
Parts
Parts

Metal

Hose

Industrial
Equipment

Total(Million yen)
Quarterly
consolidated
Adjustments statement of(Note) 1
incomeamounts(Note) 2

Net sales
Sales to external customers
Intersegment sales ortransfer
Total

11,89010,774

2,755

1,657

1,331

28,408-28,408

203

0

3

40

-

247

-247

-

12,094

10,775

2,758

1,697

1,331

28,656-247

28,408Segment income
408
92
-226
-51
98
321
-1,221-899(loss)(Notes) 1. The adjustment of -1,221 million yen for segment income (loss) includes an inter-segment elimination of 3 million yen
and corporate expenses that are not allocated to any reportable segments totaling -1,224 million yen. Corporate
expenses are primarily general and administrative expenses that are not attributable to any reportable segments.
2. Segment income (loss) is adjusted to be consistent with operating loss recorded in the quarterly consolidated statementof income.
2. Information on impairment loss on non-current assets and goodwill and other by reporting segment
Not applicable.

II. Six-month period under review (from April 1, 2021 to September 30, 2021)
1. Information on net sales, income or loss by reporting segment
Reporting segment
Total(Million yen)
Quarterly
consolidated
Adjustments statement of(Note) 1
incomeamounts(Note) 2

Functional
Parts

AntiVibration
Parts

Metal

Hose

Industrial
Equipment

16,25813,935

2,682

2,299

1,474

36,650-36,650

272

2

0

50

-

326

-326

-

16,531

13,937

2,682

2,350

1,474

36,976-326

36,650Net sales
Sales to externalcustomers
Intersegment sales ortransfer
Total

Segment income
1,996
821
-43
102
286
3,162
-1,342
1,820(loss)(Notes) 1. The adjustment of -1,342 million yen for segment income (loss) includes an inter-segment elimination of 2 million yen
and corporate expenses that are not allocated to any reportable segments totaling -1,344 million yen. Corporate
expenses are primarily general and administrative expenses that are not attributable to any reportable segments.
2. Segment income (loss) is adjusted to be consistent with operating profit recorded in the quarterly consolidated
statement of income.
2. Information on changes to reporting segments, etc.
As described in “Changes in Accounting Policies,” the Company adopted the Revenue Recognition Accounting Standard, etc.,
at the beginning of the first quarter of the fiscal year ending March 2022 and changed its accounting method for revenue
recognition. Accordingly, the method of accounting for profit or loss in the business segments has also been changed.
As a result of these changes, net sales for the functional parts, anti-vibration parts, and metal business segments have declinedby 124 million yen, 87 million yen, and 657 million yen respectively for the six-month period under review, compared to thefigures otherwise calculated by the accounting method used prior to the changes. The effects of these changes on operating profit
were insignificant.
3. Information on impairment loss on non-current assets and goodwill and other by reporting segment
Not applicable.