July 17, 2024

Consolidated Financial Results
for the First Quarter of the Fiscal Year Ending February 28, 2025
(Three Months Ended May 31, 2024)[Japanese GAAP]
Company name:Securities code:
Representative:
Contact:

Freund Corporation

Listing: Tokyo Stock Exchange
6312
URL: https://www.freund.co.jp
Iwao Fusejima, President & CEO
Hiroaki Sekiwa, Executive Officer, General Manager, Corporate Administration Division
Tel: +81-3-6890-0750
Scheduled date of filing of Quarterly Report:
July 16, 2024
Scheduled date of payment of dividend:
Preparation of supplementary materials for quarterly financial results: None
None
Holding of quarterly financial results meeting:(All amounts are rounded down to the nearest million yen)

1. Consolidated Financial Results for the First Quarter (March 1, 2024 – May 31, 2024) of the
Fiscal Year Ending February 28, 2025
(1) Consolidated results of operations(Percentages represent year-on-year changes)
Net sales

Operating profit

Million yen

Three months ended May 31, 2024
Three months ended May 31, 2023
Note: Comprehensive income%

Million yen%

Million yen

%

4,124
(1.8)
(264)
(247)
4,200
18.8
(29)
(17)
Three months ended May 31, 2024: (16) million yen
Three months ended May 31, 2023:
71 million yen
Diluted net income
Net income per shareper share
Yen

Three months ended May 31, 2024
Three months ended May 31, 2023
Reference: Equity in earnings of affiliates

Profit attributable toowners of parent

Ordinary profit

Million yen

%

(205)
(18)
(-%)
(down 78.5%)-

Yen(12.16)(1.12)
Three months ended May 31, 2024:
Three months ended May 31, 2023:(11) million yen(3) million yen(2) Consolidated financial position
Total assets

Net assets

Million yen

As of May 31, 2024
As of Feb. 29, 2024
Reference: Equity capital

Equity ratio

Million yen

Net assets per share%

25,272
14,67725,78915,023As of May 31, 2024: 14,677 million yen

Yen

58.1
868.7258.3
889.03As of Feb. 29, 2024: 15,023 million yen

2. Dividends
1Q-endDividend per share
3Q-end2Q-endYen

Year-end

Total

Yen

Yen

Yen

Yen

Fiscal year ended Feb. 29, 2024
0.00
Fiscal year ending Feb. 28, 2025
Fiscal year ending Feb. 28, 2025 (forecast)
0.00
Note: Revision to the most recently announced dividend forecast: None

-

20.00

20.00

-

25.00

25.00

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

Operating profit

Million yen%

Million yen%

Yen

Full year
23,5002.6
1,100(13.4)
1,100
Note: Revision to the most recently announced consolidated forecast: None%

Million yen%(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) Application of special accounting methods for presenting quarterly consolidated financial statements: Yes
Note: Please refer to page 8 “(3) Application of Special Accounting Methods for Presenting Quarterly Consolidated
Financial Statements” for details.

(3) 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:None3) Changes in accounting-based estimates:

None4) Restatements:

None(4) Number of outstanding shares (common stock)1) Number of shares outstanding at the end of the period (including treasury shares)
As of May 31, 2024:

18,400,000 shares

As of Feb. 29, 2024:

18,400,000 shares

As of Feb. 29, 2024:

1,501,308 shares

2) Number of treasury shares at the end of the period
As of May 31, 2024:

1,503,851 shares

3) Average number of shares outstanding during the period
Three months ended May 31, 2024:

16,898,650 shares

Three months ended May 31, 2023: 16,744,520 sharesThis financial report is not subject to quarterly review 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 the information currently available. Actual performance may significantly differ due to various
reasons. Please refer to the section “Explanation of Consolidated Forecast and Other Forward -looking Statements” on page 3 ofthe attachments regarding preconditions or other related matters for forecasts shown above.

Freund Corporation (6312) Financial Results for the First Quarter of FY2/25

Contents of Attachments
1. Qualitative Information on Quarterly Consolidated Financial Performance2(1) Explanation of Results of Operations

2(2) Explanation of Financial Position

3(3) Explanation of Consolidated Forecast and Other Forward-looking Statements

3

2. Quarterly Consolidated Financial Statements and Notes

4(1) Quarterly Consolidated Balance Sheet

4(2) Quarterly Consolidated Statements of Income and Comprehensive Income

6(3) Notes to Quarterly Consolidated Financial Statements

8

Going Concern Assumption

8

Significant Changes in Shareholders’ Equity

8

Application of Special Accounting Methods for Presenting Quarterly Consolidated Financial Statements

8

Segment and Other Information

8

Revenue Recognition10

3. Others

11

Orders and Sales

111Freund Corporation (6312) Financial Results for the First Quarter of FY2/25

1. Qualitative Information on Quarterly Consolidated Financial Performance(1) Explanation of Results of Operations
In the first quarter of the fiscal year ending February 20 25, the Japanese economy saw an increase in consumer
spending due to improvements in employment and personal income, along with higher demand from foreign
tourists. However, the outlook for the Japanese economy remains uncertain. The continuing Ukraine and Middle
East conflicts are creating geopolitical tensions, economic growth is slowing in China, and the yen’s depreciation
is raising 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 large pharmaceutical companies increasing production toaddress the social issue of shortages of pharmaceuticals, as well as making other expenditures to replace aging
equipment. In addition, the pharmaceutical industry is expected to continue to grow in the global market, driven
by the aging populations in developed countries and the increase in populations and improvement of healthcare
standards in emerging countries.
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 on achieving steady shipments oforders to solve the social issue of pharmaceutical supply shortages. In addition, activities will continue with thegoal of strengthening the Freund brand in markets worldwide by further increasing collaboration and synergies
among group companies through its global five-pole framework, which includes Japan, the United States, India,
Italy, and China.
In the current fiscal year, we are working on reaching the consolidated targets of sales of 23,500 million yen andan operating profit of 1,100 million yen.
In the first quarter of the fiscal year ending in February 2025, net sales decreased 1.8% year-over-year to 4,124
million yen, operating loss was 264 million yen compared with a loss of 29 million yen one year earlier, ordinary
loss was 247 million yen compared with a loss of 17 million yen one year earlier, and loss attributable to ownersof parent was 205 million yen compared with a loss of 18 million yen one year earlier.
Operating results by segment are as follows.
Machinery Business Segment
Segment sales increased year-over-year as machinery orders in Japan rose due to increased expenditures bygeneric drug manufacturers to boost production capacity. Additionally, the order backlog remains stable at a highlevel. However, SG&A expenses increased due to one-time expenses associated with the core IT system update.
Moreover, both the U.S. and Italian subsidiaries saw a significant drop in first -quarter sales, resulting inoperating losses. The sales decline was partly due to a reactionary drop from the large number of shipments at theend of the previous fiscal year.
As a result, net sales decreased 2.0% year-over-year to 2,506 million yen and segment loss was 219 million yen
compared with segment loss of 76 million yen one year earlier.
Chemicals Business Segment
Sales of pharmaceutical excipients used for oral drugs are on track to surpass the previous fiscal year’s record
high. One reason was higher orders from major customers in Japan for increasing production.
Sales of food preservatives fell below the level in the previous fiscal year due to some major customers switching
to procuring from multiple companies to ensure business continuity.
SG&A expenses increased also in this segment due to one-time expenses associated with the change to a newcore IT system.
As a result, net sales decreased 1.5% year-over-year to 1,618 million yen and segment profit decreased 40.6% to123 million yen.

2

Freund Corporation (6312) Financial Results for the First Quarter of FY2/25(2) Explanation of Financial Position
Total assets decreased 516 million yen from the end of the previous fiscal year to 25,272 million yen at the endof the first quarter. This mainly reflected decreases of 1,231 million yen in notes and accounts receivable -trade,and contract assets, 104 million yen in electronically recorded monetary claims -operating and 757 million yen insoftware in progress, while there were increases of 1,035 million yen in work in process and 579 million yen insoftware.
Total liabilities decreased 171 million yen from the end of the previous fiscal year to 10,594 million yen at theend of the first quarter. This mainly reflected decreases of 663 million yen in notes and accounts payable-trade,
265 million yen in income taxes payable and 170 million yen in electronically recorded obligations -operating,while there was an increase of 962 million yen in contract liabilities.
Net assets decreased 345 million yen from the end of the previous fiscal year to 14,677 million yen at the end of
the first quarter. This mainly reflected a decrease of 543 million yen in retained earnings, while there was anincrease of 180 million yen in foreign currency translation adjustment.
(3) Explanation of Consolidated Forecast and Other Forward-looking Statements
As of the date of publication of this material, there are no revisions to the full year consolidated forecasts for the
fiscal year ending February 28, 2025, which were disclosed in the Consolidated Financial Results for the Fiscal
Year Ended February 29, 2024 dated April 12, 2024.

3

Freund Corporation (6312) Financial Results for the First Quarter of FY2/25

2. Quarterly Consolidated Financial Statements and Notes(1) Quarterly Consolidated Balance Sheet
FY2/24(As of Feb. 29, 2024)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade, and contract assets
Electronically recorded monetary claims-operating
Merchandise and finished goods
Work in process
Raw materials and supplies
Prepaid expenses
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net
Land
Other, net
Total property, plant and equipment
Intangible assets
Software
Software in progress
Customer relationship
Other
Total intangible assets
Investments and other assets
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Notes and accounts payable-trade
Electronically recorded obligations-operating
Short-term borrowings
Income taxes payable
Contract liabilities
Provision for bonuses
Provision for bonuses for directors (and other officers)
Other
Total current liabilities
Non-current liabilities
Lease liabilities
Retirement benefit liability
Asset retirement obligations
Provision for retirement benefits for directors (and otherofficers)
Other
Total non-current liabilities
Total liabilities

4(Thousands of yen)First quarter of FY2/25(As of May 31, 2024)

4,736,849
6,121,064
937,132
921,946
2,661,592
2,232,055
221,569
754,733(49,689)
18,537,254

4,603,813
4,889,237
832,510
980,400
3,697,493
2,135,341
263,505
785,783(52,644)
18,135,441

2,080,391
1,148,176
1,227,261
4,455,829

2,165,652
1,149,300
1,112,790
4,427,743

22,458757,542
332,488
38,2311,150,721

601,882
338,089
35,390975,362

503,485
1,147,370(5,400)1,645,455
7,252,006
25,789,260

581,835
1,157,583(5,400)1,734,019
7,137,125
25,272,566

2,567,304
1,313,951
515,031
330,261
3,932,098
276,915
33,973
951,170
9,920,707

1,904,148
1,143,933
407,524
65,172
4,894,354
383,238
6,850
974,5819,779,802

380,961
294,323
67,396

381,413
280,623
67,42918,93318,304

83,514845,129
10,765,836

67,052814,823
10,594,625

Freund Corporation (6312) Financial Results for the First Quarter of FY2/25

FY2/24(As of Feb. 29, 2024)(Thousands of yen)First quarter of FY2/25(As of May 31, 2024)

Net assets
Shareholders’ equity
Share capital

1,035,600

1,035,600

Capital surplus

1,289,513

1,300,067

Retained earnings

12,287,564

11,744,147

Treasury shares(701,365)(702,571)

Total shareholders’ equity

13,911,313

13,377,243

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets

565,16273,673

1,022,683

1,203,270

24,26423,753

1,112,110

1,300,697

15,023,424

14,677,940

25,789,260

25,272,566

Freund Corporation (6312) Financial Results for the First Quarter of FY2/25(2) Quarterly Consolidated Statements of Income and Comprehensive Income
Quarterly Consolidated Statement of Income(For the Three-month Period)First three months of FY2/24(Mar. 1, 2023 – May 31, 2023)(Thousands of yen)First three months of FY2/25(Mar. 1, 2024 – May 31, 2024)

Net sales

4,200,237

4,124,618

Cost of sales

2,858,637

2,697,403

Gross profit

1,341,599

1,427,214

Selling, general and administrative expenses

1,371,148

1,691,559

Operating loss

(29,548)(264,345)

Non-operating income
Interest income

0

4,631

Dividend income

4,198

4,149

Technical support fee income

5,137

2,375

Foreign exchange gains

8,670

21,834

Other

12,746

4,822

Total non-operating income

30,75337,812

Interest expenses
Share of loss of entities accounted for using equity
methodOther

14,720

8,970

3,256

11,265383

1,033

Total non-operating expenses

18,36021,269(17,155)(247,802)

Gain on sale of non-current assets

142-

Total extraordinary income

142-

Loss on retirement of non-current assets

3,936

4,130

Loss on valuation of investment securities

6,285

-

Non-operating expenses

Ordinary loss
Extraordinary income

Extraordinary losses

10,221

4,130

Loss before income taxes

Total extraordinary losses(27,235)(251,932)

Income taxes(8,446)(46,489)

Loss(18,789)(205,443)

Loss attributable to owners of parent(18,789)(205,443)

6

Freund Corporation (6312) Financial Results for the First Quarter of FY2/25

Quarterly Consolidated Statement of Comprehensive Income(For the Three-month Period)First three months of FY2/24(Mar. 1, 2023 – May 31, 2023)(Thousands of yen)First three months of FY2/25(Mar. 1, 2024 – May 31, 2024)(18,789)(205,443)(5,068)

8,510

97,665167,093

(627)

(510)

(1,257)

13,492

90,712

188,586

71,923(16,856)

71,923(16,856)

Loss
Other comprehensive income
Valuation difference on available-for-salesecurities
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net oftax
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to owners ofparent7

Freund Corporation (6312) Financial Results for the First Quarter of FY2/25(3) Notes to Quarterly Consolidated Financial Statements
Going Concern Assumption
Not applicable.
Significant Changes in Shareholders’ Equity
Not applicable.
Application of Special Accounting Methods for Presenting Quarterly Consolidated Financial Statements
The tax expenses are calculated by first estimating the effective tax rate after the application of tax effectaccounting with respect to profit before income taxes during the fiscal year in which the period falls, andmultiplying that rate by the profit before income taxes for the period. However, Freund uses the statutory
effective tax rate to calculate tax expenses for cases in which using the estimated effective tax rate gives a
noticeably irrational result.
Segment and Other Information
Segment information
I First three months of FY2/24 (Mar. 1, 2023 – May 31, 2023)
1. Information related to net sales and profit or loss for each reportable segment
MachineryBusiness

Chemicals
Business(Thousands of yen)Amounts shown on quarterly
consolidated statement ofincome (Note 2)

Adjustment(Note 1)Total

Net sales(1) External sales(2) Inter-segment sales
and transfers

2,556,527

1,643,710

4,200,237-

4,200,237

-

-

-

-

-

Total

2,556,527

1,643,710

4,200,237-

4,200,237

Segment profit (loss)(76,259)
207,094130,834(160,383)(29,548)
Notes: 1. Contents of adjustments are as follows.
The negative adjustment of 160,383 thousand yen to segment profit (loss) includes corporate expenses that are notallocated to any of the reportable segments. Corporate expenses mainly consist of general and administrative
expenses that are not attributable to any of the reportable segments.
2. Segment profit (loss) is adjusted to be consistent with operating loss recorded in the quarterly consolidated
statement of income.

2. Information related to impairment losses on non-current assets, goodwill, etc. for each reportable segment
Not applicable.
3. Information by region
Net sales
In addition to the disclosure of information required by the “Accounting Standard for Quarterly Financial
Statements,” the Company provides information by region (net sales) based on the “Accounting Standard forDisclosures about Segments of an Enterprise and Related Information” for the purpose of providing investors
with useful information.
Japan

United States

Latin America

Europe

Asia

Other

(Thousands of yen)Total

4,200,237
2,556,808
590,951
372,746
155,132
387,041
137,557
Notes: 1. Classification of net sales is based on the location of the client and categorized by country or region.
2. Groupings of countries and regions other than Japan are determined by geographic proximity and mutual
operational relationships. Major countries and regions in each geographic segment are as follows.
(1) Latin America:
Brazil, etc.
(2) Europe:
France, Italy, UK, etc.
(3) Asia:
China, India, etc.
(4) Other:
Middle East, etc.

8Freund Corporation (6312) Financial Results for the First Quarter of FY2/25

II First three months of FY2/25 (Mar. 1, 2024 – May 31, 2024)
1. Information related to net sales and profit or loss for each reportable segment
MachineryBusiness

Chemicals
Business(Thousands of yen)Amounts shown onquarterly consolidated
statement of income(Note 2)Adjustment(Note 1)Total

Net sales(1) External sales(2) Inter-segment sales andtransfers

2,506,203

1,618,414

4,124,618-

4,124,618

-

-

-

-

-

Total

2,506,203

1,618,414

4,124,618-

4,124,618

Segment profit (loss)(219,518)
123,108(96,410)(167,934)(264,345)
Notes: 1. Contents of adjustments are as follows.
The negative adjustment of 167,934 thousand yen to segment profit (loss) includes corporate expenses that are notallocated to any of the reportable segments. Corporate expenses mainly consist of general and administrative
expenses that are not attributable to any of the reportable segments.
2. Segment profit (loss) is adjusted to be consistent with operating loss recorded in the quarterly consolidated
statement of income.

2. Information related to impairment losses on non-current assets, goodwill, etc. for each reportable segment
Not applicable.
3. Information by region
Net sales
In addition to the disclosure of information required by the “Accounting Standard for Quarterly Financial
Statements,” the Company provides information by region (net sales) based on the “Accounting Standard forDisclosures about Segments of an Enterprise and Related Information” for the purpose of providing investors
with useful information.
(Thousands of yen)Japan

United States

Latin America

Europe

Asia

Other

Total

3,473,408
230,140
75,047
154,172
140,437
51,412
4,124,618
Notes: 1. Classification of net sales is based on the location of the client and categorized by country or region.
2. Groupings of countries and regions other than Japan are determined by geographic proximity and mutual
operational relationships. Major countries and regions in each geographic segment are as follows.
(1) Latin America:
Brazil, Mexico, etc.
(2) Europe:
France, Italy, UK, etc.
(3) Asia:
China, India, etc.
(4) Other:
Middle East, Africa, etc.

9Freund Corporation (6312) Financial Results for the First Quarter of FY2/25

Revenue Recognition
Information of breakdown on revenue from contracts with customers
First three months of FY2/24 (Mar. 1, 2023 – May 31, 2023)(Thousands of yen)
Reportable segments

Machinery Business

Chemicals Business

Total

Japan

989,534

1,567,273

2,556,808

United States

590,951-

590,951

Latin America

372,746-

372,746

Europe133,035

22,097

155,132

Asia

333,61453,427

387,041

Other

136,645912

137,557

Revenue from contracts with customers

2,556,527

1,643,710

4,200,237

External sales

2,556,527

1,643,710

4,200,237

First three months of FY2/25 (Mar. 1, 2024 – May 31, 2024)(Thousands of yen)
Reportable segments

Machinery BusinessJapan

1,969,336

Chemicals Business

Total

1,504,071

3,473,408

United States

230,140-

230,140

Latin America

74,552495

75,047

Europe111,752

42,420154,172

Asia

69,50470,932

140,437

Other

50,917495

51,412

Revenue from contracts with customers

2,506,203

1,618,414

4,124,618

External sales

2,506,203

1,618,414

4,124,618

10

Freund Corporation (6312) Financial Results for the First Quarter of FY2/25

3. Others
Orders and Sales(1) Orders received
Operating segment(Thousands of yen)First three months of FY2/24(Mar. 1, 2023 – May 31, 2023)

First three months of FY2/25(Mar. 1, 2024 – May 31, 2024)

AmountAmountYear-on-year (%)

Year-on-year (%)

Machinery Business
4,200,255
103.9
3,056,331
72.8
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(Thousands of yen)First three months of FY2/24(Mar. 1, 2023 – May 31, 2023)

First three months of FY2/25(Mar. 1, 2024 – May 31, 2024)

AmountAmountYear-on-year (%)

Year-on-year (%)

Machinery Business
14,607,614
112.1
16,636,801
113.9
Notes: 1. No order backlog is shown for the Chemicals Business because production is based on sales plans rather thanspecific orders.
2. Order backlog is based on selling prices; inter-segment transactions have been eliminated.

(3) Sales(Thousands of yen)

Operating segment

First three months of FY2/24(Mar. 1, 2023 – May 31, 2023)

First three months of FY2/25(Mar. 1, 2024 – May 31, 2024)

AmountAmountComposition (%)

Composition (%)

Machinery Business

2,556,527

60.9

2,506,203

60.8

Chemicals Business

1,643,710

39.1

1,618,414

39.2

Total

4,200,237

100.0

4,124,618

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
prepared in accordance with accounting principles and practices generally accepted in Japan, for the convenience of readers
who prefer an English translation.

11