April 12, 2024

Consolidated Financial Results for the Fiscal Year Ended February 29, 2024
Company name:Securities code:
Representative:
Contact:[Japanese GAAP]
Listing: Tokyo Stock Exchange
URL: https://www.freund.co.jp

Freund Corporation

6312
Iwao Fusejima, President & CEO
Hiroaki Sekiwa, Executive Officer, General Manager, Corporate Administration Division
Tel: +81-3-6890-0750
Scheduled date of Annual General Meeting of Shareholders:
May 30, 2024
Scheduled date of filing of Annual Securities Report:
May 31, 2024
Scheduled date of payment of dividend:
May 31, 2024
Yes
Preparation of supplementary materials for financial results:
Yes (for institutional investors and securities analysts)
Holding of financial results meeting:(All amounts are rounded down to the nearest million yen)

1. Consolidated Financial Results for the Fiscal Year Ended February 29, 2024
(March 1, 2023 – February 29, 2024)(Percentages represent year-on-year changes)(1) Consolidated results of operations
Net sales

Operating profit

Million yen

Fiscal year ended Feb. 29, 2024
Fiscal year ended Feb. 28, 2023
Note: Comprehensive income%

Million yen

Profit attributable toowners of parent

Ordinary profit%

Million yen%

Million yen%

22,90316.5
1,270 181.3
1,285 129.9
764
19,65811.5
451 (54.0)
559 (45.9)(538)
Fiscal year ended Feb. 29, 2024:
1,211 million yen(up 933.4%)
Fiscal year ended Feb. 28, 2023:
117 million yen(down 85.9%)
Net income per
Diluted net
Ordinary profit Operating profit
Return on equity
share
income per shareon total assets
on net sales
Yen

Fiscal year ended Feb. 29, 2024
Fiscal year ended Feb. 28, 2023
Reference: Equity in earnings of affiliates

Yen

%

45.46
5.3
(32.15)(3.8)
Fiscal year ended Feb. 29, 2024: (24) million yen
Fiscal year ended Feb. 28, 2023: (15) million yen

%

%

5.3
2.5

5.5
2.3

(2) Consolidated financial position
Total assets

Net assets

Million yen

As of Feb. 29, 2024
As of Feb. 28, 2023
Reference: Equity capital

Equity ratio

Million yen

Net assets per share%

25,78915,02322,758
14,117
As of Feb. 29, 2024: 15,023 million yen

Yen

58.3
889.0362.0
843.09As of Feb. 28, 2023: 14,117 million yen(3) Consolidated cash flows
Cash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities

Cash and cash equivalents
at end of the period

Million yen

Million yen

Million yen

Million yen

2,368
(196)

(739)
(666)

(874)
451

4,736
3,917

Fiscal year ended Feb. 29, 2024
Fiscal year ended Feb. 28, 2023

2. Dividends
Dividend per share
1Q-end2Q-endYen

Yen

3Q-end Year-end
Yen

Yen

Total

Total
dividends

Dividend
Dividend on
payout ratio
equity(consolidated) (consolidated)

Yen Million yen%

Fiscal year ended Feb. 28, 2023
0.00
20.00
20.00
334
Fiscal year ended Feb. 29, 2024
0.00
20.00
20.00
337
44.0
Fiscal year ending Feb. 28, 2025
0.00
25.00
25.00
54.6
(forecast)
Note: Breakdown of the year-end dividend for the fiscal year ending Feb. 28, 2025: Ordinary dividend:
20.00 yen
Commemorative dividend: 5.00 yen

%

2.4
2.3

3. Consolidated Forecast for the Fiscal Year Ending February 28, 2025 (March 1, 2024 – February 28, 2025)
Net sales
Full year(Percentages represent year-on-year changes)
Net income per
Profit attributable toOrdinary profit
owners of parent
share

Operating profit

Million yen%

Million yen%

Million yen%

Million yen%

Yen

23,5002.6

1,100(13.4)

1,100(14.4)

770

0.7

45.76

* Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in changes inscope of consolidation): None
Newly added: -Excluded: -(2) Changes in accounting policies and accounting-based estimates, and restatements
1) Changes in accounting policies due to revisions in accounting standards, others:None2) Changes in accounting policies other than 1) above:Yes3) Changes in accounting-based estimates:

None4) Restatements:

None(3) Number of outstanding shares (common stock)1) Number of shares outstanding at the end of the period (including treasury shares)
As of Feb. 29, 2024:

18,400,000 shares

As of Feb. 28, 2023:

18,400,000 shares

As of Feb. 28, 2023:

1,655,480 sharesFiscal year ended Feb. 28, 2023:

16,744,520 shares

2) Number of treasury shares at the end of the period
As of Feb. 29, 2024:

1,501,308 shares

3) Average number of shares outstanding during the period
Fiscal year ended Feb. 29, 2024:

16,828,646 shares

Reference: Summary of Non-consolidated Financial Results
Non-consolidated Financial Results for the Fiscal Year Ended February 29, 2024
(March 1, 2023 – February 29, 2024)(1) Non-consolidated results of operations
Net sales
Fiscal year ended Feb. 29, 2024
Fiscal year ended Feb. 28, 2023

(Percentages represent year-on-year changes)
Ordinary profit
ProfitOperating profit

Million yen%

Million yen%

Million yen%

Million yen%

13,65011,795

15.7
(6.8)

1,004
817

22.9
(31.8)

1,114
992

12.3
(24.6)

614
(315)

-

Net income per share Diluted net income per share
Fiscal year ended Feb. 29, 2024
Fiscal year ended Feb. 28, 2023

Yen

Yen

36.53
(18.85)-(2) Non-consolidated financial position
Total assets
Million yen

As of Feb. 29, 2024
As of Feb. 28, 2023
Reference: Shareholders’ equity

Net assets

Equity ratio

Million yen

19,934
12,961
17,162
12,619As of Feb. 29, 2024: 12,961 million yen

Net assets per share
%

Yen

65.0
766.9973.5
753.66
As of Feb. 28, 2023: 12,619 million yen

This financial report is not subject to audit by certified public accountants or auditing firms.
Cautionary statement with respect to forecasts of future performance and other special items
Statements about future performance, including forecasts in this document are based on certain assumptions that the Company
considers to be reasonable and relies on and the information currently available. Actual performance may significantly differ due
to various reasons.

Freund Corporation (6312) Financial Results for FY2/24

Contents of Attachments
1. Overview of Results of Operations

2(1) Results of Operations

2(2) Financial Position

3(3) Cash Flows3(4) Outlook

3(5) Basic Policy for Profit Distribution, and Dividends in the Current and Next Fiscal Years

4

2. Basic Approach to the Selection of Accounting Standards

4

3. Consolidated Financial Statements and Notes

5(1) Consolidated Balance Sheet

5(2) Consolidated Statements of Income and Comprehensive Income

7(3) Consolidated Statement of Changes in Equity

9(4) Consolidated Statement of Cash Flows

11(5) Notes to Consolidated Financial Statements

13

Going Concern Assumption

13

Changes in Accounting Policies

13

Segment and Other Information

13

Revenue Recognition

17

Per Share Information

17

Subsequent Events

17

4. Others

18

Orders and Sales

18

1Freund Corporation (6312) Financial Results for FY2/24

1. Overview of Results of Operations(1) Results of Operations
Expectations for an economic recovery in Japan increased during the fiscal year that ended in February 2024.
Economic activity began to return to normal after the pandemic, employment and personal income improved, andthere were upturns in consumer spending and foreign tourists in Japan. However, the outlook for the Japanese
economy remains uncertain. The Ukraine and Middle East conflicts are creating geopolitical tensions, economic
growth is slowing in China because of the weak real estate market and other reasons, and the yen’s depreciation israising prices in Japan.
In the pharmaceutical industry, a key user of Freund Group products, there has been a large volume of capital
expenditures in Japan. This is primarily driven by pharmaceutical companies increasing production to address
shortages of pharmaceuticals, as well as making other expenditures to replace aging equipment. In addition, thepharmaceutical industry is expected to continue to grow in the global market, driven by the aging populations indeveloped countries and the increase in populations and improvement of healthcare standards in emerging countries.
During the fiscal year, the Freund Group remained strongly committed to meeting the growing demand for
production mainly at large pharmaceutical companies in Japan; our group companies diligently focused onachieving steady shipments of orders to solve the social issue of pharmaceutical supply shortages. On the other hand,operations started at a business site in China in June 2023, which expanded the Freund Group’s global network tofive regions. Activities will continue with the goal of strengthening the Freund brand in markets worldwide byfurther increasing collaboration and synergies among group companies.
In the fiscal year ended February 2024, net sales increased 16.5 % year-over-year to 22,903 million yen, operating
profit increased 181.3% to 1,270 million yen, ordinary profit increased 129.9% to 1,285 million yen, and profit
attributable to owners of parent was 764 million yen compared with a loss attributable to owners of parent of 538
million yen in the previous fiscal year.
In the machinery business, sales increased due to consistent shipments achieved in Japan and other countries. In thechemicals business, sales of pharmaceutical excipients and food preservatives remained strong. The result wasrecord-high fiscal year sales. The order backlog also increased to a record high during the fiscal year.
Earnings increased as sales growth more than offset the rising cost of parts and materials, labor, and other items. In
the previous fiscal year, impairment losses on goodwill and intangible assets related to consolidated subsidiary Cos.
Mec S.r.l. in Italy held down earnings. As a result of a decrease in those losses in the current fiscal year, there was asignificant increase in profit attributable to owners of parent following the loss one year earlier.
Operating results by segment are as follows.
Machinery Business Segment
In Japan, we collaborated with partner companies to ensure early shipment of orders backed by the strong demandfor capital expenditures mentioned above. Our overseas subsidiaries focused diligently on shipping products to
Latin America, resulting in steady shipments both domestically and internationally. In the previous fiscal year, sales
and earnings were negatively impacted by significant shipment delays due to the tight labor supply and extended
lead times for parts/materials procurement caused by supply chain disruptions at the U.S. subsidiary. In the current
fiscal year, sales and earnings recovered because of the strong shipments and an improvement in profitability.
As a result, net sales increased 20.1% year-over-year to 16,157 million yen and segment profit was 924 million yen
compared with segment profit of 59 million yen one year earlier.
Chemicals Business Segment
Sales of pharmaceutical excipients used for oral drugs surpassed the previous fiscal year’s record high. One reason
was higher orders from major customers in Japan for increasing production.
In the food preservatives sector, sales benefited from the steady recovery of demand for confectionery products thatwas backed by the recovery of trips and other outings, including by foreign tourists in Japan. As withpharmaceutical excipients, sales in the current fiscal year in this sector surpassed the previous fiscal year’s record
high.
2Freund Corporation (6312) Financial Results for FY2/24

As a result, net sales increased 8.6% year-over-year to 6,745 million yen and segment profit increased 7.0% to 1,044
million yen.
(2) Financial Position
Total assets increased 3,030 million yen from the end of the previous fiscal year to 25,789 million yen at the end of
the current fiscal year. This increase is primarily the result of increases of 1,205 million yen in notes and accounts
receivable-trade, and contract assets, 819 million yen in cash and deposits, 317 million yen in electronicallyrecorded monetary claims-operating, 197 million yen in software in progress and 161 million yen in merchandiseand finished goods.
Total liabilities increased 2,124 million yen from the end of the previous fiscal year to 10,765 million yen at the endof the current fiscal year. This increase is mainly the result of increases of 1,019 million yen in contract liabilities,
670 million yen in notes and accounts payable-trade and 480 million yen in electronically recorded obligationsoperating.
Net assets increased 906 million yen from the end of the previous fiscal year to 15,023 million yen at the end of thecurrent fiscal year.
(3) Cash FlowsThe balance of cash and cash equivalents at the end of the current fiscal year was 4,736 million yen, up 819 million
yen over the end of the previous fiscal year (this compares with a decrease of 228 million yen in the previous fiscal
year).
The cash flow components during the current fiscal year and the main reasons for changes are as described below.
Cash flows from operating activities
Net cash provided by operating activities was 2,368 million yen (compared with net cash used of 196 million yen in
the previous fiscal year). Profit before income taxes of 1,101 million yen and an increase in notes and accounts
payable-trade of 1,085 million yen were major sources of cash.
Cash flows from investing activities
Net cash used in investing activities was 739 million yen (compared with net cash used of 666 million yen in theprevious fiscal year). This was primarily due to expenditures of 348 million yen for acquisition of property, plantand equipment and expenditures of 391 million yen for acquisition of intangible assets.
Cash flows from financing activities
Net cash used in financing activities was 874 million yen (compared with net cash provided of 451 million yen in
the previous fiscal year). This was mainly the result of a net decrease of 450 million yen in short-term borrowingsand dividends paid of 333 million yen.
(4) Outlook
The Japanese economy is expected to continue its recovery during the fiscal year ending in February 2025,
supported by capital expenditures and further improvements in employment and personal income. In the global
economy, there may be increasing geopolitical risks, high costs of fuel and raw material, and a downturn, primarilyin Europe, the United States and China. In addition, numerous elections in major countries and regions during 2024
are another source of uncertainty. As a result, the outlook for the Japanese and global economies is likely to remain
uncertain.
The Freund Group will celebrate its 60th anniversary in the fiscal year ending in February 2025. This fiscal year
also marks the start of the Ninth Medium-term Management Plan* that covers the three-year period ending in
February 2027. In line with the corporate philosophy of “Develop the Future through Creativity®,” our groupcompanies will implement the measures outlined in this new plan to achieve sustained growth, strengthen the
management foundation, and increase corporate value.

3

Freund Corporation (6312) Financial Results for FY2/24

Forecasts for the fiscal year ending in February 2025 are as follows.
Consolidated forecasts for the fiscal year ending February 28, 2025
Net sales
23,500Operating profit

Ordinary profit

1,100

1,100

(Millions of yen)
Profit attributable toowners of parent
770

For the performance of foreign subsidiaries, the Group assumes an average exchange rate of 140 yen to the U.S.
dollar and 150 yen for the euro during the fiscal year.
* Ninth Medium-term Management Plan
Access IR News on the Freund website for more information in Japanese about this management plan.
https://www.freund.co.jp/news/2024/ir/(5) Basic Policy for Profit Distribution, and Dividends in the Current and Next Fiscal Years
Freund Corporation considers the maximization of shareholder value as the most critical management objective. The
goals are to enhance its corporate structure to effectively respond to changes in the business environment anddistribute profits to its shareholders.
Regarding profit distribution, the basic principle is to allocate earnings based on performance, targeting an annual
consolidated dividend payout ratio of 30%. The policy is to pay a consistent and stable dividend while using acomprehensive approach that includes the retention of earnings for strengthening business operations and future
growth and other considerations.
For the fiscal year that ended in February 2024, Freund plans to pay an ordinary year-end dividend of 20 yen per
share, which is the same as for the previous fiscal year, in line with the policy of maintaining a consistent and stabledividend.
For the fiscal year ending February 2025, Freund plans to pay a year-end dividend of 25 yen per share, which
includes an ordinary dividend of 20 yen and a commemorative dividend of 5 yen for Freund’s 60th anniversary.
2. Basic Approach to the Selection of Accounting Standards
The Freund Group uses Japanese GAAP for the preparation of its consolidated financial statements, which allows
comparisons across different fiscal years and with other Japanese companies.

4

Freund Corporation (6312) Financial Results for FY2/24

3. Consolidated Financial Statements and Notes(1) Consolidated Balance Sheet
FY2/23(As of Feb. 28, 2023)(Thousands of yen)
FY2/24(As of Feb. 29, 2024)

AssetsCurrent assets
Cash and deposits

3,917,128

4,736,849

Notes and accounts receivable-trade, and contract assets

4,915,548

6,121,064

Electronically recorded monetary claims-operating

619,666

937,132

Merchandise and finished goods

760,326

921,946

Work in process

2,717,692

2,661,592

Raw materials and supplies

2,108,285

2,232,055

Advance payments to suppliers

414,129431,632

Prepaid expenses

199,546

221,569

Other

232,922

323,101

Allowance for doubtful accounts(15,226)(49,689)

15,870,019

18,537,254

Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures

4,279,200

4,597,415

Accumulated depreciation(2,273,390)(2,517,024)

Buildings and structures, net

2,005,809

2,080,391

Machinery, equipment and vehicles
Accumulated depreciation
Machinery, equipment and vehicles, net
LandConstruction in progress
Other
Accumulated depreciation
Other, net
Total property, plant and equipment

2,673,424

2,758,083(1,978,021)(2,177,315)

695,402580,768

1,145,522

1,148,176

204,971285,647

1,828,426

1,965,379(1,438,679)(1,604,534)

389,746

360,8444,441,453

4,455,829

Intangible assets
Software32,49922,458

Software in progress

560,486

757,542

Customer relationship

324,848

332,488

Other

49,621

38,231

Total intangible assets

967,456

1,150,721

Investment securities

657,433

681,608

Business insurance funds

269,227

269,227

Deferred tax assets

366,398

503,485

Other

192,286

196,534

Allowance for doubtful accounts(5,400)(5,400)Total investments and other assets

1,479,946

1,645,455

Investments and other assets

Total non-current assets
Total assets

56,888,855

7,252,006

22,758,875

25,789,260

Freund Corporation (6312) Financial Results for FY2/24

FY2/23(As of Feb. 28, 2023)(Thousands of yen)
FY2/24(As of Feb. 29, 2024)

Liabilities
Current liabilities
Notes and accounts payable-trade

1,896,836

2,567,304

Electronically recorded obligations-operating

833,521

1,313,951

Short-term borrowings

896,092

515,031

Income taxes payable

130,135

330,261

Accrued expenses

435,497

488,834

Contract liabilities

2,913,026

3,932,098

Provision for bonuses

220,553

276,915

Provision for bonuses for directors (and other officers)

17,18533,973

Other472,396462,335

7,815,246

9,920,707

Lease liabilities

408,206

380,961Retirement benefit liability

267,351

294,323

Asset retirement obligations
Provision for retirement benefits for directors (and otherofficers)
Other

67,26367,396

12,096

18,93371,522

83,514

Total current liabilities
Non-current liabilities

Total non-current liabilities
Total liabilities

826,439

845,129

8,641,685

10,765,836

1,035,600

1,035,600

Net assets
Shareholders’ equity
Share capital
Capital surplus

1,289,513

1,289,513

Retained earnings

11,899,999

12,287,564

Treasury shares(773,363)(701,365)

Total shareholders’ equity

13,451,750

13,911,313

Accumulated other comprehensive income
Valuation difference on available-for-sale securities

32,992

65,162Foreign currency translation adjustment

612,727

1,022,683

Remeasurements of defined benefit plans

19,71924,264

Total accumulated other comprehensive income

665,439

1,112,110

14,117,189

15,023,424

22,758,875

25,789,260

Total net assets
Total liabilities and net assets

6

Freund Corporation (6312) Financial Results for FY2/24(2) Consolidated Statements of Income and Comprehensive Income
Consolidated Statement of Income
FY2/23(Mar. 1, 2022 – Feb. 28, 2023)(Thousands of yen)
FY2/24(Mar. 1, 2023 – Feb. 29, 2024)

Net sales

19,658,519

22,903,644

Cost of sales

13,665,247

15,859,736

Gross profit

5,993,272

7,043,908

Selling, general and administrative expenses

5,541,697

5,773,777451,574

1,270,131

299

3,043

Operating profit
Non-operating income
Interest income
Dividend income

7,714

7,984

Technical support fee income

19,098

14,771

Rental income

1,325

1,166

Foreign exchange gains

109,030

39,420Other32,33240,874

Total non-operating income

169,800

107,260

Non-operating expenses
Interest expenses
Share of loss of entities accounted for using equity
methodOther34,511

65,256

15,42924,691

12,415

2,172

Total non-operating expenses

62,356

92,119559,018

1,285,272

Gain on sale of non-current assets

31,063

8,676

Total extraordinary income

31,063

8,676

Loss on retirement of non-current assets

33,051

186,609

Loss on sale of non-current assets

1,124

-

Loss on valuation of investment securities

28,456

6,240

Impairment losses

933,929-

Total extraordinary losses

996,562

192,849

Profit (loss) before income taxes(406,480)

1,101,099

Income taxes - current

284,763447,571

Income taxes - deferred(152,826)(111,442)

Total income taxes

131,936

336,129

Profit (loss)(538,417)

764,970

Profit (loss) attributable to owners of parent(538,417)

764,970

Ordinary profit
Extraordinary income

Extraordinary losses

7Freund Corporation (6312) Financial Results for FY2/24

Consolidated Statement of Comprehensive Income
FY2/23(Mar. 1, 2022 – Feb. 28, 2023)
Profit (loss)(Thousands of yen)
FY2/24(Mar. 1, 2023 – Feb. 29, 2024)(538,417)

764,970

Valuation difference on available-for-sale securities(6,695)32,169Foreign currency translation adjustment

633,343

402,983

Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities
accounted for using equity method

27,091

4,544

1,926

6,973

Total other comprehensive income

655,664446,670

117,247

1,211,641

117,247

1,211,641

Other comprehensive income

Comprehensive income(Breakdown)Comprehensive income attributable to owners ofparent8

Freund Corporation (6312) Financial Results for FY2/24(3) Consolidated Statement of Changes in Equity
FY2/23 (Mar. 1, 2022 – Feb. 28, 2023)(Thousands of yen)
Shareholders’ equity
Share capital
Balance at beginning of
periodCumulative effects ofchanges in accounting
policies
Restated balance

Capital surplus

1,035,600

Retained earnings

1,289,513

12,808,681

Total shareholders’equityTreasury shares(773,363)(35,373)
1,035,600

1,289,513

12,773,307

14,360,432(35,373)(773,363)

14,325,058

Changes during period
Dividends of surplus
Loss attributable toowners of parent
Net changes in items
other than shareholders’equityTotal changes during
periodBalance at end of period(334,890)(334,890)(538,417)(538,417)--(873,307)-(873,307)

1,035,600

1,289,513

11,899,999(773,363)

13,451,750(Thousands of yen)

Accumulated other comprehensive income
Valuation difference Foreign currency Remeasurements ofon available-fortranslation
defined benefit
sale securities
adjustment
plans
Balance at beginning of
periodCumulative effects ofchanges in accounting
policies
Restated balance

39,688(37,972)(7,371)

Total accumulated
othercomprehensive
income(5,655)

Total net assets

14,354,776(35,373)

39,688(37,972)(7,371)(5,655)

14,319,403

Changes during period
Dividends of surplus
Loss attributable toowners of parent
Net changes in items
other than shareholders’equityTotal changes during
periodBalance at end of period(334,890)(538,417)(6,695)

650,699

27,091

671,094

671,094(6,695)

650,699

27,091

671,094(202,213)

32,992

612,727

19,719665,439

14,117,189

9Freund Corporation (6312) Financial Results for FY2/24

FY2/24 (Mar. 1, 2023 – Feb. 29, 2024)(Thousands of yen)
Shareholders’ equity
Share capital
Balance at beginning of
periodCapital surplus

1,035,600

Retained earnings

1,289,513

11,899,999

Treasury shares(773,363)

Total shareholders’equity13,451,750

Changes during period
Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
sharesNet changes in items
other than shareholders’equityTotal changes during
periodBalance at end of period(334,890)(334,890)

764,970

764,970(0)(0)(42,514)

71,99829,484--

387,565

71,997459,563

1,035,600

1,289,513

12,287,564(701,365)

13,911,313(Thousands of yen)

Accumulated other comprehensive income
Valuation difference Foreign currency Remeasurements ofon available-fortranslation
defined benefit
sale securities
adjustment
plans
Balance at beginning of
period32,992

612,727

19,719Total accumulated
othercomprehensive
income665,439

Total net assets

14,117,189

Changes during period
Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
sharesNet changes in items
other than shareholders’equityTotal changes during
periodBalance at end of period(334,890)
764,970(0)29,48432,169409,9564,544

446,670446,670

32,169409,9564,544

446,670

906,234

65,162

1,022,683

24,264

1,112,110

15,023,424

10Freund Corporation (6312) Financial Results for FY2/24(4) Consolidated Statement of Cash Flows
FY2/23(Mar. 1, 2022 – Feb. 28, 2023)(Thousands of yen)
FY2/24(Mar. 1, 2023 – Feb. 29, 2024)(406,480)

1,101,099

Depreciation

565,043

539,728

Impairment losses

933,929-

Amortization of goodwill

77,811--

29,483

Cash flows from operating activities
Profit (loss) before income taxes

Share-based payment expenses
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for bonuses for
directors (and other officers)
Increase (decrease) in allowance for doubtful accounts(33,987)

55,547(12,733)

16,788964

31,231

Interest and dividend income(8,013)(11,027)

Interest expenses
Foreign exchange losses (gains)Share of loss (profit) of entities accounted for using
equity method
Loss (gain) on sale of property, plant and equipment
Loss (gain) on valuation of investment securities
Loss on retirement of property, plant and equipment

34,511

65,256(92,707)(44,863)

15,42924,691(29,938)(8,676)28,456

6,240

33,051

19,860Loss on retirement of intangible assets-

166,748

Decrease (increase) in trade receivables(171,232)(1,380,355)

Decrease (increase) in inventories(54,315)

95,370Decrease (increase) in other assets(147,044)

22,480

Increase (decrease) in trade payables(78,886)

1,085,979

Increase (decrease) in contract liabilities(356,219)

887,624

Increase (decrease) in other liabilities(56,941)(51,889)

Other, net(4,128)341

Subtotal

236,569

2,651,659

8,013

11,027(34,511)(65,256)

2,450

34,238(412,829)(267,448)

Interest and dividends received
Interest paid
Income taxes refund
Income taxes paid
Other, net
Net cash provided by (used in) operating activities

4,260

4,106

(196,046)

2,368,327(269,229)(348,310)

40,877

13,348Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
Payments for retirement of property, plant andequipment
Purchase of intangible assets(8,213)(10,512)(330,339)(391,471)

Purchase of investment securities(97,422)(1,974)

Payments of guarantee deposits(3,604)(2,104)

Proceeds from refund of guarantee deposits

1,269

1,131

(666,663)(739,893)

Net cash provided by (used in) investing activities

11Freund Corporation (6312) Financial Results for FY2/24

FY2/23(Mar. 1, 2022 – Feb. 28, 2023)(Thousands of yen)
FY2/24(Mar. 1, 2023 – Feb. 29, 2024)

Net increase (decrease) in short-term borrowings

852,796(450,438)

Repayments of long-term borrowings(6,956)(6,586)

Cash flows from financing activities

Repayments of lease liabilities(60,201)(83,228)

Dividends paid

(333,960)(333,749)

Net cash provided by (used in) financing activities

451,677(874,002)

Effect of exchange rate change on cash and cash
equivalents

182,952

65,289Net increase (decrease) in cash and cash equivalents(228,079)

819,721

Cash and cash equivalents at beginning of period

4,145,207

3,917,128

Cash and cash equivalents at end of period

3,917,128

4,736,849

12

Freund Corporation (6312) Financial Results for FY2/24(5) Notes to Consolidated Financial Statements
Going Concern Assumption
Not applicable.
Changes in Accounting Policies
Change in valuation method for inventories
From the beginning of the current fiscal year, some foreign consolidated subsidiaries have changed the valuation
method for inventories from the lower of cost or market method with cost determined by the first-in first-out method
to the lower of cost or market method with cost determined by the gross average method.
This change was made as part of a reexamination of valuation methods that was performed due to a change in IT
system. The new valuation method was not applied retroactively because its monetary effect is negligible.
Segment and Other Information
Segment information
1. Overview of reportable segments
The reportable segments of the Freund Group are components for which discrete financial information is available.
These segments are subject to regular reviews by the Board of Directors to make decisions regarding resource
allocation and to evaluate performance.
The Freund Group is engaged in manufacturing and sale of machinery and chemical products. Consequently, theFreund Group has two reportable business segments: the Machinery Business and the Chemicals Business.
Main products and services of each reportable segment
Machinery Business:

Granulating devices; construction of granulating machinery plants; measuring
instruments and parts; and outsourced granulation of synthetic resins

Chemicals Business:

Pharmaceutical excipients and dietary supplements; food preservatives; R&D,
formulation studies and other projects for pharmaceuticals, food, chemicals and otherproducts; and development and technology licensing of new dosage forms ofpharmaceutical products

2. Calculation method for net sales, profit or loss, assets, liabilities, and other items for each reportable segment
The reportable segments follow the accounting methods that are generally consistent with those adopted for
preparation of the consolidated financial statements.
Segment profit (loss) for reportable business segments is determined based on operating profit (loss).
Inter-segment sales are derived from prices in third-party transactions.

13

Freund Corporation (6312) Financial Results for FY2/24

3. Information related to net sales, profit or loss, assets, liabilities, and other items for each reportable segment
FY2/23 (Mar. 1, 2022 – Feb. 28, 2023)(Thousands of yen)
Reportable segment
MachineryBusiness

Chemicals
Business

Total

Amounts shown on
consolidated financial
statements (Note 2)

Adjustment(Note 1)

Net sales
External sales
Inter-segment sales and transfers

13,448,982-

6,209,537-

19,658,519--

19,658,519
19,658,519-

13,448,982

6,209,537

19,658,519-

Segment profit

59,461

976,289

1,035,751(584,177)

451,574

Segment assets

13,706,794

4,946,841

18,653,635

4,105,239

22,758,875

Total

Other items
Depreciation
413,697
145,723
559,4215,622
565,043
Investment in equity-method
332,714332,714332,714affiliate
Increase in property, plant and
323,859
268,681592,541
53,861
646,402
equipment and intangible assets
Notes: 1. The adjustment includes the following items.
(1) The negative adjustment of 584,177 thousand yen to segment profit is corporate expenses that are not allocated toany of the reportable segments. Corporate expenses mainly consist of general and administrative expenses thatare not attributable to any of the reportable segments.
(2) The 4,105,239 thousand yen adjustment to segment assets is corporate assets that are not allocated to any of thereportable segments. Corporate assets mainly consist of Freund’s surplus funds (cash and deposits), long-term
investment funds (investment securities and insurance funds), and assets of the administrative operations ofFreund.
(3) The 5,622 thousand yen adjustment to depreciation is mainly depreciation of corporate assets that are notallocated to any of the reportable segments.
(4) The 53,861 thousand yen adjustment to increase in property, plant and equipment and intangible assets is mainly
the sum of corporate assets that are not allocated to the reportable segments.
2. Segment profit is adjusted to be consistent with operating profit recorded in the consolidated financial statements .

14

Freund Corporation (6312) Financial Results for FY2/24

FY2/24 (Mar. 1, 2023 – Feb. 29, 2024)(Thousands of yen)
Reportable segment
MachineryBusiness

Chemicals
BusinessAmounts shown on
consolidated financial
statements (Note 2)

Adjustment(Note 1)Total

Net sales
External sales

16,157,667

Inter-segment sales and transfers

6,745,977

22,903,644-

22,903,644

-

-

-

-

-

16,157,667

6,745,977

22,903,644-

22,903,644

Segment profit

924,984

1,044,181

1,969,165(699,034)

1,270,131

Segment assets

15,157,631

5,567,904

20,725,535

5,063,724

25,789,260

Total

Other items
Depreciation
397,333
135,072
532,405
7,322
539,728
Investment in equity-method
314,996
314,996
314,996
affiliate
Increase in property, plant and
302,225
365,972
668,198
63,655
731,853
equipment and intangible assets
Notes: 1. The adjustment includes the following items.
(1) The negative adjustment of 699,034 thousand yen to segment profit is corporate expenses that are not allocated toany of the reportable segments. Corporate expenses mainly consist of general and administrative expenses thatare not attributable to any of the reportable segments.
(2) The 5,063,724 thousand yen adjustment to segment assets is corporate assets that are not allocated to any of thereportable segments. Corporate assets mainly consist of Freund’s surplus funds (cash and deposits), long-term
investment funds (investment securities and insurance funds), and assets of the administrative operations ofFreund.
(3) The 7,322 thousand yen adjustment to depreciation is mainly depreciation of corporate assets that are notallocated to any of the reportable segments.
(4) The 63,655 thousand yen adjustment to increase in property, plant and equipment and intangible assets is mainly
the sum of corporate assets that are not allocated to the reportable segments.
2. Segment profit is adjusted to be consistent with operating profit recorded in the consolidated financial statements.

Related information
FY2/23 (Mar. 1, 2022 – Feb. 28, 2023)
1. Information by product or service
This information is omitted because the same information is presented in segment information.
2. Information by region(1) Net sales(Thousands of yen)

Japan

US

11,716,020

1,716,232

Latin America

EuropeAsia

1,042,741

2,322,929

2,506,738

Other353,857

Total
19,658,519

Note: Classification of net sales is based on the location of the client and categorized by country or region.

(2) Property, plant and equipment
Japan2,616,743

US
1,373,598(Thousands of yen)
Italy

Total

451,110

4,441,453

3. Information by major client
This information is omitted because no specific external client accounts for 10% or more of consolidated net sales
on the consolidated statement of income.
FY2/24 (Mar. 1, 2023 – Feb. 29, 2024)
1. Information by product or service
This information is omitted because the same information is presented in segment information.

15

Freund Corporation (6312) Financial Results for FY2/24

2. Information by region(1) Net sales(Thousands of yen)

Japan

US

Latin America

13,994,388

2,009,921

EuropeAsia

1,384,712

1,787,693

2,867,795

Other859,134

Total
22,903,644

Note: Classification of net sales is based on the location of the client and categorized by country or region.

(2) Property, plant and equipment
Japan
2,638,002

US1,382,340(Thousands of yen)
Italy

Total

435,486

4,455,829

3. Information by major client
This information is omitted because no specific external client accounts for 10% or more of consolidated net sales
on the consolidated statement of income.
Information related to impairment losses on non-current assets for each reportable segment
FY2/23 (Mar. 1, 2022 – Feb. 28, 2023)
The Company has recognized impairment losses related to non-current assets of 933,094 thousand yen in the
Machinery Business segment, 624 thousand yen in the Chemicals Business segment, and 210 thousand yen in the
category of corporate assets that are not allocated to any of the reportable segments.
FY2/24 (Mar. 1, 2023 – Feb. 29, 2024)
Not applicable.
Information related to goodwill amortization and the unamortized balance for each reportable segment
FY2/23 (Mar. 1, 2022 – Feb. 28, 2023)
Goodwill amortization of 77,811 thousand yen was recorded for consolidated subsidiary Cos. Mec S.r.l. in the
Machinery Business segment. There is no unamortized balance of this goodwill.
FY2/24 (Mar. 1, 2023 – Feb. 29, 2024)
Not applicable.
Information related to gain on bargain purchase for each reportable segment
Not applicable.

16Freund Corporation (6312) Financial Results for FY2/24

Revenue Recognition
Information of breakdown on revenue from contracts with customers
FY2/23 (Mar. 1, 2022 – Feb. 28, 2023)(Thousands of yen)
Reportable segments
Machinery BusinessJapan

Chemicals Business

Total

5,845,815

5,870,204

11,716,020

United States

1,716,112

120

1,716,232

Latin America

2,506,738-

2,506,738

Europe833,865

208,875

1,042,741

Asia

2,193,002

129,926

2,322,929

Other353,447410

353,857

Revenue from contracts with customers

13,448,982

6,209,537

19,658,519

External sales

13,448,982

6,209,537

19,658,519

FY2/24 (Mar. 1, 2023 – Feb. 29, 2024)(Thousands of yen)
Reportable segments
Machinery Business

Chemicals Business

Total

Japan

7,533,997

6,460,390

13,994,388

United States

2,009,921-

2,009,921

Latin America

2,867,795-

2,867,795

Europe1,261,954

122,757

1,384,712

Asia

1,630,649

157,044

1,787,693

Other853,349

5,785

859,134

Revenue from contracts with customers

16,157,667

6,745,977

22,903,644

External sales

16,157,667

6,745,977

22,903,644

Per Share Information
FY2/23(Mar. 1, 2022 – Feb. 28, 2023)(Yen)
FY2/24(Mar. 1, 2023 – Feb. 29, 2024)

843.09889.03

Net assets per share(32.15)
Net income (loss) per share
Notes: 1. Diluted net income per share is not presented since the Company has no outstanding dilutive shares.
2. The basis of calculating the net income (loss) per share is as follows:

45.46

FY2/23(Mar. 1, 2022 – Feb. 28, 2023)(Thousands of yen)
FY2/24(Mar. 1, 2023 – Feb. 29, 2024)(538,417)

764,970--

Profit (loss) attributable to common shareholders of parent(538,417)

764,970

Average number of common shares outstanding during theperiod (Thousand shares)

16,744

16,828

Profit (loss) attributable to owners of the parent
Amounts not attributable to common shareholders

Subsequent Events
Not applicable.

17Freund Corporation (6312) Financial Results for FY2/24

4. Others
Orders and Sales(1) Orders received
Operating segment

FY2/23(Mar. 1, 2022 – Feb. 28, 2023)(Thousands of yen)
FY2/24(Mar. 1, 2023 – Feb. 29, 2024)

AmountAmountYear-on-year (%)

Year-on-year (%)

Machinery Business
14,630,593
93.7
18,600,239
127.1
Notes: 1. No orders received are shown for the Chemicals Business because production is based on sales plans rather thanspecific orders.
2. Orders received are based on selling prices; inter-segment transactions have been eliminated.

(2) Order backlog
Operating segment

FY2/23(Mar. 1, 2022 – Feb. 28, 2023)(Thousands of yen)
FY2/24(Mar. 1, 2023 – Feb. 29, 2024)

AmountAmountYear-on-year (%)

Year-on-year (%)

Machinery Business
121.3
15,842,927
123.5
12,826,511
Notes: 1. No order backlog is shown for the Chemicals Business because production is based on sales plans rather than specificorders.
2. Order backlog is based on selling prices; inter-segment transactions have been eliminated.

(3) Sales
Operating segment

FY2/23(Mar. 1, 2022 – Feb. 28, 2023)(Thousands of yen)
FY2/24(Mar. 1, 2023 – Feb. 29, 2024)

AmountAmountComposition (%)

Composition (%)

Machinery Business

13,448,982

68.4

16,157,667

70.5

Chemicals Business

6,209,537

31.6

6,745,977

29.5

22,903,644

100.0

Total
19,658,519
100.0
Note: Sales are based on selling prices; inter-segment transactions have been eliminated.

This summary report is solely a translation of “Kessan Tanshin” (in Japanese, including attachments), which has been preparedin accordance with accounting principles and practices generally accepted in Japan, for the convenience of readers who prefer
an English translation.

18