FY3/15 1Q Consolidated Financial Statements[J-GAAP]
August 7, 2014
Company name: Matsuda Sangyo Co., Ltd.
Exchanges listed on:
Tokyo Stock Exchange (First Section)
Company code:
7456
URL:
http://www.matsuda-sangyo.co.jp
Representative:
Yoshiaki Matsuda, President and Representative Director
Inquiries:
Atsushi Kinoshita, Director in Charge of IR
TEL: +81-3-5381-0728
Filing date of quarterly report:
August 8, 2014
Date to start dividends distribution:–
Supplementary quarterly materials prepared:No
Quarterly results information meeting held:
No(Figures are rounded down to the nearest million yen)

1. FY3/15 1Q consolidated results (April 1, 2014 – June 30, 2014)(1) Consolidated results
Net sales
Operating income(millions of yen)

FY3/15 1Q

42,940FY3/14 1Q

43,133(Note) Comprehensive income:(%) (millions of yen)

(Percentages are year-on-year changes)

Ordinary income(%) (millions of yen)

-0.4

931

-33.8

3.2

1,407

35.5

FY3/15 1Q: ¥440 million (-76.7%)

Net income per share

Net income(%) (millions of yen)

(%)

1,072

-22.6

714

-18.0

1,385

22.6

871

19.7

FY3/14 1Q: ¥1,891 million (83.9%)

Diluted net income per share
(yen)

(yen)

FY3/15 1Q

26.81

－

FY3/14 1Q

32.21

－

(2) Consolidated financial position
Total assets

Shareholders’ equity ratio

Net assets(millions of yen)(millions of yen)(%)

End-FY3/15 1Q

67,01647,404

70.7

End-FY3/14

66,39847,44971.5(Reference) Shareholders’ equity:

End-FY3/15 1Q: ¥47,403 million

End-FY3/14: ¥47,447 million

2. Dividends
1Q
(yen)

FY3/14－

FY3/15－

Annual Dividends
3Q

2Q
(yen)

FY3/15 (Projections)

4Q

(yen)

Annual
(yen)

(yen)

12.00

－

12.00

24.00

12.00

－

12.00

24.00

(Note) Revisions to the most recently announced projections of dividends: No

3. Consolidated earnings projections for FY3/15 (April 1, 2014 – March 31, 2015)(Percentages are year-on-year changes)

Net sales(millions of yen)

1H FY3/15
FY3/1580,000170,000

Operating income(%) (millions of yen)

-4.6
2.8

Ordinary income(%) (millions of yen)

2,150 -10.7
4,700
4.4

2,300
5,000

(%) (millions of yen)

-13.7
2.2

(Note) Revisions to the most recently announced projections of consolidated earnings: No

Net income
per share

Net income
1,500
3,270

(%)

(yen)

-13.6
2.4

55.78
121.62

* Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries in accordance withchanges in the scope of consolidation): No(2) Application of special accounting treatment in preparing the quarterly consolidated financial statements: No(3) Changes in accounting policies, changes in accounting estimates and restatement of revisions
1) Changes in accounting policies with revision of accounting standards: Yes
2) Changes in accounting policies other than the above:No3) Changes in accounting estimates:
No4) Restatement of revisions:No(4) Number of issued shares (common shares)
1) Number of issued shares(including treasury stock)2) Number of treasury shares
3) Average number of shares
during the period

End-FY3/15 1Q

28,908,581 shares End-FY3/14

28,908,581 shares

End-FY3/15 1Q

2,308,240 shares End-FY3/14

2,228,187 shares

FY3/15 1Q

26,651,997 shares FY3/14 1Q

27,052,829 shares

Presentation of implementation status for quarterly review procedures
The quarterly review procedure based on the Financial Instruments and Exchange Act does not apply to this report. At the time of
disclosure of this report, review procedures for quarterly financial statements pursuant to the Financial Instruments and Exchange
Act had not been completed.

Notes on appropriate use of earnings projections and other special remarks
Earnings projections and other forward-looking statements in this document are based on reasonable assumptions andinformation available to the Company at the time of release. Actual results may differ materially from forward-looking statements
due to a number of factors. For more information about earnings projections assumptions and notes regarding the use of
earnings projections, please refer to “1. Qualitative information on consolidated results during the period, (3) Qualitative
information on consolidated earnings projections” on page 3 of the attached documents.

Contents of Attached Document

1. Qualitative information on consolidated results during the period .................................................. 2(1) Qualitative information on consolidated results ............................................................................................. 2(2) Qualitative information on consolidated financial position ............................................................................ 2(3) Qualitative information on consolidated earnings projections ...................................................................... 3

2. Matters concerning summary information (notes) .............................................................................. 3(1) Changes in significant subsidiaries during the period ................................................................................... 3

3. Quarterly consolidated financial statements ....................................................................................... 4(1) Quarterly consolidated balance sheets ............................................................................................................ 4(2) Quarterly consolidated statements of income and comprehensive income................................................. 6(3) Quarterly consolidated statements of cash flows ........................................................................................... 8(4) Notes on quarterly consolidated financial statements ................................................................................. 10(Notes on premise of a going concern) ................................................................................................................ 10(Notes on significant changes in the amount of shareholders' equity).................................................................. 10(Segment Information, etc.) .................................................................................................................................. 10

1

1. Qualitative information on consolidated results during the period(1) Qualitative information on consolidated results
In the first three months of the fiscal year ending March 31, 2015, the Japanese economy showed signs of amoderate recovery, with corporate earnings improving on the back of government policies that supported acontinued weak yen and gains in the equity market. However, the outlook for the economy remained uncertain due
to concerns about a pullback in demand after the hike to consumption tax.
Under these circumstances, performance in the Matsuda Sangyo Group’s business segments was as follows.
Precious metals business segment
In the precious metals division, sales volume for precious metals other than gold expanded year on year amid
continued signs of a recovery in production at key customers in the semiconductor and electronic parts sectors.
However, sales volume for gold products, electronic materials and other products fell year on year, and the price ofsome precious metals also declined. As a result, sales as a whole in the division were lower than in the same
period a year earlier.
In the environmental division, production activity in target sectors recovered, lifting the volume of materials
handled by the Group. However, sales in the division declined year on year, partly due to a drop in the price ofsilver recovered from photosensitive materials.
As a result, net sales for the precious metals business segment totaled ¥30,013 million (down 7.0% year onyear), and operating income was ¥650 million (down 47.3% year on year).
Food business segment
Despite signs of recovery in the domestic economy, the food business segment faced a challenging operating
environment due to weak consumer spending after the consumption tax hike and higher costs caused by the weak
yen and high oil prices. However, sales volume and sales value for seafood products and livestock products
increased year on year. Also, although sales volume for vegetables and other agricultural products declined slightly,
sales rose compared with the same period of the previous fiscal year, partly due to higher prices.
As a result, net sales for the food business segment were ¥12,946 million (up 18.9% year on year), andoperating income was ¥280 million (up 63.0% year on year).
As a result of the above, for the first three months of the fiscal year ending March 31, 2015, consolidated net
sales were ¥42,940 million (down 0.4% year on year), operating income was ¥931 million (down 33.8% year onyear), ordinary income was ¥1,072 million (down 22.6% year on year), and net income was ¥714 million (down
18.0% year on year).

(2) Qualitative information on consolidated financial position(1) Assets, liabilities and net assets
Total assets
Total assets as of the end of the first three months were ¥67,016 million, an increase of ¥617 million from theprevious fiscal year end. This mainly reflected increases in notes and accounts receivable – trade, and inventories,
outweighing a decline in cash and deposits.
Liabilities
Total liabilities as of the end of the first three months were ¥19,611 million, an increase of ¥662 million from theprevious fiscal year end. This mainly reflected an increase in loans payable.
Net assets
Net assets as of the end of the first three months were ¥47,404 million, a decrease of ¥44 million from the previous
fiscal year end. This mainly reflected a decline in valuation differences and translation adjustments, such asdeferred gains or losses on hedges, which exceeded profits in the first quarter, and the payment of year-end
dividends.

2(2) Cash flows status
As of the end of the first three months under review, the balance of cash and cash equivalents (hereafter, “cash”)
stood at ¥5,504 million, a decrease of ¥1,293 million from the previous fiscal year end.
Cash flows from operating activities
Operating activities used net cash of ¥1,800 million. This mainly reflected the difference between the increase inincome before income taxes and depreciation on the one hand and a corresponding decrease in income taxes paid,
an increase in notes and accounts receivable－trade, and an increase in inventories on the other. Compared withthe same period in the previous fiscal year, when operating activities used net cash of ¥1,517 million, cash used byoperating activities declined ¥283 million.
Cash flows from investing activities
Investing activities used net cash of ¥1,195 million. This was mainly due to the purchase of property, plant andequipment related to the installation and upgrade of equipment at the Group’s plants. Compared with the same
period in the previous fiscal year, when investing activities used net cash of ¥254 million, net cash used in investing
activities increased by ¥940 million.
Cash flows from financing activities
Financing activities generated net cash of ¥1,742 million. This was mainly due to the increase in loans payable.
Compared with the same period in the previous fiscal year, when financing activities used net cash of ¥148 million,
net cash generated in financing activities increased by ¥1,891 million.

(3) Qualitative information on consolidated earnings projections
We have made no change to our consolidated earnings projections announced on May 12, 2014.

2. Matters concerning summary information (notes)(1) Changes in significant subsidiaries during the period(Application of “Accounting Standard for Retirement Benefits,” etc.)
Effective from the first quarter of fiscal year ending March 31, 2015, the Company has applied the provisions inparagraph 35 of “Accounting Standard for Retirement Benefits” (Accounting Standards Board of Japan (“ASBJ”)
Statement No.26, May 17, 2012) and the provisions in paragraph 67 of “Guidance on Accounting Standard for
Retirement Benefits” (ASBJ Guidance No.25, May 17, 2012). Accordingly, the Company reviewed the calculation
method for retirement benefit obligations and service costs, retaining the straight-line method to attribute projected
retirement benefit obligations to each fiscal period and changing the method for determining the discount rate tomultiple discount rates for each period.
The application of the accounting standard for retirement benefits, etc. conforms with the transitional treatment
stipulated in Item 37 of the Accounting Standard for Retirement Benefits, and the effect of the change in calculation
method of retirement benefit obligations and service costs is adjusted in retained earnings at the start of the firstquarter of the current fiscal year.
As a result, at the start of the first quarter of the current fiscal year, net defined benefit liability increased by ¥113
million and retained earnings decreased by ¥72 million. The application of the accounting standard for retirement
benefits, etc. had an immaterial impact on operating income, ordinary income and net income in the first threemonths of the current fiscal year.

33. Quarterly consolidated financial statements(1) Quarterly consolidated balance sheets(millions of yen)
End-FY3/14(As of March 31, 2014)

End-FY3/15 1Q(As of June 30, 2014)

AssetsCurrent assets
Cash and deposits

6,798

5,504

Notes and accounts receivable – trade

16,482

18,380

Merchandise and finished goods

12,82813,488

313

314

6,235

6,423

420

395

Accounts receivable – other

1,547

1,217

Others

2,597

2,224

-43

-44

47,18147,902Work in process
Raw materials and supplies
Deferred tax assets

Allowance for doubtful accounts
Total current assets
Fixed assets
Property, plant and equipment
Buildings and structures

7,664

7,661

Accumulated depreciation-3,760-3,846

Buildings and structures, net

3,903

3,814

Machinery, equipment and vehicles

6,776

6,886

Accumulated depreciation-4,385-4,563

Machinery, equipment and vehicles, net

2,390

2,323

7,773

7,761

264

247

Accumulated depreciation

-163

-158

Land
Leased assets

Leased assets, net

101

89

Construction in progress

126

47

Others997

989

Accumulated depreciation

-682

-697

Others, net

314

291

14,61014,328Others215

204

Total intangible assets

215

204

Investment securities

3,040

3,240

Deferred tax assets

Total property, plant and equipment
Intangible assets

Investments and other assets

119

103

Others

1,436

1,442

Allowance for doubtful accounts

-205

-205

Total investments and other assets

4,390

4,580

Total fixed assets

19,216

19,113

Total assets

66,39867,016

4

(millions of yen)
End-FY3/14(As of March 31, 2014)

End-FY3/15 1Q(As of June 30, 2014)

Liabilities
Current liabilities
Notes and accounts payable – trade

8,095

7,904

Short-term loans payable

1,347

3,696

Current portion of long-term loans payable

623

590

Lease obligations

47

41

Income taxes payable

579

264

Provision for bonuses

623

360

Accounts payable – other

2,258

1,112

Others

2,278

2,655

Total current liabilities

15,854

16,626

Non-current liabilities
Long-term loans payable

2,244

2,096

Lease obligations

53

47

Provision for directors’ retirement benefits

596

554

Provision for retirement benefits

156

236

Others

44

50

3,095

2,985

18,94919,611

3,559

3,559

Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Common stock
Capital surplus

4,008

4,008

Retained earnings

41,311

41,634

Treasury shares-2,526-2,620Total shareholders’ equity

46,353

46,582

Valuation difference on available-for-salesecurities

252

311

Deferred gains or losses on hedges

86

-149

Foreign currency translation adjustments

770

673

Remeasurements of defined benefit plans

-14

-13

1,094

821

Accumulated other comprehensive income

Total accumulated other comprehensive income
Minority interests

10

Total net assets

47,44947,404

66,39867,016

Total liabilities and net assets5(2) Quarterly consolidated statements of income and comprehensive income[Quarterly consolidated statements of income](millions of yen)
FY3/14 1Q(April 1, 2013 –June 30, 2013)

FY3/15 1Q(April 1, 2014 –June 30, 2014)

Net sales

43,13342,940

Cost of sales

38,72939,138Gross profit

4,403

3,802

Selling, general, and administrative expenses

2,996

2,870

Operating income

1,407

931

Interest income

01

Dividend income

7

9

Share of profit of entities accounted for using
equity method

39

135

Purchase discounts

5

4House rent income

15

15

Others917

Total non-operating income

77

182

Interest expenses

11

10

Foreign exchange losses

59

3

Cost of lease revenue

19

19

Others99Total non-operating expenses

99

42

Ordinary income

1,385

1,072

Income before income taxes and minority interests

1,385

1,072

Non-operating income

Non-operating expenses

Income taxes – current

298

210

Income taxes – deferred

217

147

Total income taxes

515

358

Income before minority interests

870

713

-1

-0

871

714

Minority interests in loss
Net income

6[Quarterly consolidated statements of comprehensive income](millions of yen)
FY3/14 1Q(April 1, 2013 –June 30, 2013)
Income before minority interests

FY3/15 1Q(April 1, 2014 –June 30, 2014)
870

713

Valuation difference on available-for-salesecurities

24

59

Deferred gains or losses on hedges

543

-236

Foreign currency translation adjustments

383

-68

Remeasurements of defined benefit plans-

1

Share of other comprehensive income ofaffiliates accounted for using equity method

69

-28

1,021

-272

1,891

440

Comprehensive income attributable to ownersof the parent

1,892

441

Comprehensive income attributable to minority
interests-1-0

Other comprehensive income

Total other comprehensive income
Comprehensive income
Comprehensive income attributable to7(3) Quarterly consolidated statements of cash flows(millions of yen)
FY3/14 1Q(April 1, 2013 –June 30, 2013)

FY3/15 1Q(April 1, 2014 –June 30, 2014)

Cash flows from operating activities
Income before income taxes and minority interests
Depreciation

1,385

1,072

270

328

Increase (decrease) in allowance for doubtful accounts (‘-’ means
decrease)-11

Increase (decrease) in provision for bonuses (‘-’ means decrease)

-262

-262

-23

-

-

-32

11

-42

Interest and dividend income

-8

-10

Interest expenses

11

10

Share of (profit) loss of entities accounted for using equity method

-39

-135

232

-1,91165

154-2,052

-873

209

-173

-100

-51

Others-66

608

Subtotal-368-1,317

8

10

-11

-10

Income taxes paid

-1,145-482

Cash flows from operating activities-1,517-1,800Purchase of property, plant and equipment-213-1,178Purchase of intangible assets

-28

-6

Purchase of investment securities-1-1

Others-10-9Cash flows from investing activities-254-1,195

Increase (decrease) in provision for retirement benefits (‘-’ means
decrease)
Increase (decrease) in net defined benefit liability (‘-’ means
decrease)
Increase (decrease) in provision for directors’ retirement bonuses(‘-’ means decrease)

Decrease (increase) in notes and accounts receivable – trade(‘-’ means increase)
Decrease (increase) in accounts receivable – other (‘-’ meansincrease)
Decrease (increase) in inventories (‘-’ means increase)
Increase (decrease) in accounts payable – trade (‘-’ means
decrease)
Increase (decrease) in accounts payable – other (‘-’ means
decrease)

Interest and dividend income received
Interest paid

Cash flows from investing activities8

(millions of yen)
FY3/14 1Q(April 1, 2013 –June 30, 2013)

FY3/15 1Q(April 1, 2014 –June 30, 2014)

Cash flows from financing activities
Net increase (decrease) in short-term loans payable (‘-’ means
decrease)

469

2,349

Repayments of long-term loans payable

-223

-180

Purchase of treasury shares

-54

-94

Cash dividends paid

-324

-320

Others-15-11Cash flows from financing activities

-148

1,742

Effect of exchange rate change on cash and cash equivalents

233

-40

Change in cash and cash equivalents (‘-’ means decrease)-1,687-1,293

Cash and cash equivalents at beginning of period

8,582

6,798

Cash and cash equivalents at end of period

6,895

5,504

9

(4) Notes on quarterly consolidated financial statements(Notes on premise of a going concern)
There is nothing to report.

(Notes on significant changes in the amount of shareholders' equity)
FY3/15 1Q (April 1, 2014 – June 30, 2014)
There is nothing to report.

(Segment Information, etc.)
I. FY3/14 1Q (April 1, 2013 – June 30, 2013)
1. Sales and profits or losses by reportable segments

Reportable Segments
Precious
metalsbusinesssegment

Adjustments
Food businesssegment

Note 1

Total(millions of yen)Amountrecorded onquarterly
consolidated
statements ofincomeNote 2

Net sales(1) Net sales to external
parties(2) Intersegment sales
and transfers

32,262

10,87043,133―

43,133

1

13

14

-14

―

Total

32,263

10,884

43,147-14

43,133

Segment income

1,234

172

1,407

―

1,407

(Notes) 1. Adjustments correspond to the elimination of transactions and transfers between segments.
2. Total segment income matches operating income recorded on the quarterly consolidated statements
of income.
2. Matters concerning changes in reportable segments, etc.
There is nothing to report.
II. FY3/15 1Q (April 1, 2014 – June 30, 2014)
1. Sales and profits or losses by reportable segments

Reportable Segments
Precious
metalsbusinesssegment

Adjustments
Food businesssegment

Note 1

Total(millions of yen)Amountrecorded onquarterly
consolidated
statements ofincomeNote 2

Net sales(1) Net sales to external
parties(2) Intersegment sales
and transfers
Total
Segment income

30,012

12,92842,940―42,940

1

17

18

-18

―

30,013

12,94642,959-18

42,940

650

280

931

―

931

(Notes) 1. Adjustments correspond to the elimination of transactions and transfers between segments.
2. Total segment income matches operating income recorded on the quarterly consolidated statements
of income.

10

2. Matters concerning changes in reportable segments, etc.
Effective from the first quarter of fiscal year ending March 31, 2015, the Company has applied the provisions inparagraph 35 of “Accounting Standard for Retirement Benefits” (Accounting Standards Board of Japan (“ASBJ”)
Statement No.26, May 17, 2012) and the provisions in paragraph 67 of “Guidance on Accounting Standard for
Retirement Benefits” (ASBJ Guidance No.25, May 17, 2012). Accordingly, the Company reviewed the calculation
method for retirement benefit obligations and service costs, retaining the straight-line method to attribute projected
retirement benefit obligations to each fiscal period and changing the method for determining the discount rate tomultiple discount rates for each period.
The application of the accounting standard for retirement benefits, etc. had an immaterial impact on segment
income in the first three months of the current fiscal year.

11