November 12, 2021

Consolidated Financial Resultsfor Six Months Ended September 30, 2021
(Japanese Accounting Standards)
Name of the Listed Company: Nitta Gelatin Inc.
Listing:First Section of Tokyo Stock Exchange
Stock code:
4977
URL:
http://www.nitta-gelatin.co.jp
Representative:
Koichi Ogata, Representative Director and President
Contact Person:
Norifumi Nagaoka, Director and Executive Officer;
General Manager of General Management Division
Tel: +81-72-949-5381
Scheduled date to file Quarterly Securities Report: November 12, 2021
Scheduled date to commence dividend payments: December 6, 2021
Supplementary explanatory materials prepared:
Yes
Explanatory meeting:
No(Millions of yen with fractional amounts discarded, unless otherwise noted.)

1. Consolidated financial results for the six months ended September 30, 2021
(April 1, 2021 to September 30, 2021)(1) Consolidated operating results
Net sales
Six months ended
September 30, 2021
September 30, 2020

Millions of yen%

Operating income

Ordinary income

Net income
attributable toowners of the parent

Millions of yen

Millions of yen%

Millions of yen

696
648

7.4
(33.9)

374
351%

14,863
(2.2)
593
(8.4)
15,196647(23.5)
Note: Comprehensive income
For the six months ended September 30, 2021: ¥812 million (52.1%)
For the six months ended September 30, 2020: ¥534 million (50.2%)

Earnings per share
Six months ended
September 30, 2021
September 30, 2020

Yen

%

6.3
(46.2)

Diluted earnings per
share
Yen

20.69
—
19.41
—
Notes 1. Diluted net income per share is not disclosed due to the absence of latent shares with dilution effect.
2. The Company applied the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31,
2020, ASBJ) from the start of the first quarter. Numerical indicators for the first six months ended September 30,
2020 have been calculated after retroactively applying this accounting standard. For net sales, the year-on-year
rate of change has been omitted.

(2) Consolidated financial position
As of
September 30, 2021
March 31, 2021

Total assets

Net assets

Millions of yen

Millions of yen

34,21534,915

19,567
18,873Equity ratio
%

51.0
48.1

Reference: Equity
As of September 30, 2021: ¥17,440 million
As of March 31, 2021:¥16,794 million

2. Cash dividends
First quarter

Cash dividends per share
Second quarter Third quarter Fiscal year-end

Yen

Fiscal year ended
March 31, 2021
Fiscal year ending
March 31, 2022
Fiscal year ending
March 31, 2022 (Forecasts)

Yen

—

6.00

—

7.00

Yen

Annual

Yen

Yen

—

6.00

12.00

—

7.00

14.00

Note: Changes to most recent dividend forecasts: None

3. Forecast of consolidated financial results for the fiscal year ending March 31, 2022
(April 1, 2021 to March 31, 2022)
Net sales
Full-year

Operating income(Percentages indicate year-on-year changes.)
Net income attributable Earnings per
Ordinary income to owners of the parent
shareMillions of yen%

Millions of yen%

Millions of yen%

29,500

(3.3)

1,350

(0.5)

1,350

(1.0)

Millions of yen

900

%

21.3

Yen

49.74

Note: Changes to most recent dividend forecasts: None

Notes:(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in achange in the scope of consolidation): None
New:
None
Excluded: None
(2) Adoption of special accounting methods for the preparation of quarterly consolidated financial
statements: None
(3) Changes in accounting policies, changes in accounting estimates, and restatement of revisions
a. Changes in accounting policies due to revisions to accounting standards and other guidelines: Yes
b. Changes in accounting policies due to reasons other than a. above: Nonec. Changes in accounting estimates: None
d. Restatement of revisions: None(4) Number of common shares issued
a. Total number of issued shares at the end of the period (including treasury stock)
As of September 30, 2021:
18,373,974 shares
As of March 31, 2021:
18,373,974 sharesb. Number of shares of treasury stock at the end of the period
As of September 30, 2021:
268,667 shares
As of March 31, 2021:
299,467 sharesc. Average number of shares
As of September 30, 2021:
18,087,707 shares
As of September 30, 2020:
18,135,865 shares* This financial report falls outside the scope of quarterly review procedures by Certified Public Accountantsor the independent auditor.
* Proper use of earnings forecasts, and other special matters(Note concerning forward-looking statements)
The forward-looking statements, including earnings forecasts, contained in these materials are based on
information currently available to the Company and on certain assumptions deemed to be reasonable. Thesestatements do not guarantee that the Company will achieve its earnings forecasts. In addition, actual businessand other results may differ substantially due to various factors. For details on the conditions assumed andthe cautionary notes and items in the financial forecasts, please refer to “(3) Description of Consolidated
Business Forecasts and Other Forward-looking Information” in “1. Qualitative Information Concerning
Quarterly Financial Statements” on page 5 of the Attachment to this report.

Contents
1. Qualitative Information Concerning Quarterly Financial Statements ········································ 2(1)Description of Business Results ············································································ 2(2)Description of Financial Position ·········································································· 3(3)Description of Consolidated Business Forecasts and Other Forward-looking Information ········ 5

2. Basic Approach to Selection of Accounting Standard ·························································· 5
3. Quarterly Consolidated Financial Statements and Key Notes ················································· 6(1)Consolidated Balance Sheets ··············································································· 6(2)Consolidated Statements of Income and Consolidated Statements of Comprehensive Income ··· 8Consolidated Statements of Income
First half consolidated cumulative accounting period ················································ 8Consolidated Statements of Comprehensive Income
First half consolidated cumulative accounting period ················································ 9(3)Consolidated Statements of Cash Flows ·································································· 10(4)Notes to Quarterly Consolidated Financial Statements ··············································· 12(Note Concerning Going Concern Assumption) ······················································· 12(Note Concerning Significant Changes in Shareholders’ Equity) ··································· 12(Changes in Accounting Policies) ········································································ 12(Additional Information) ·················································································· 13(Segment Information) ···················································································· 13

11. Qualitative Information Concerning Quarterly Financial Statements(1) Description of Business Results
In the first half of the fiscal year ending March 31, 2022 (April 1 to September 30, 2021), theglobal economy experienced a moderate recovery, amid economic expansion in China, Europe
and North America, where normalization of socioeconomic activities progressed. The Japanese
economy experienced uncertainty about the future given the reissuance of and extension of thestate of emergency, despite a recovery trend seen in certain industries.
In this environment, the Group launched a new three-year medium-term management plan in
May 2021. The management policies for the Group set out in this medium-term management
plan are presented below.
1. Strategic allocation of management resources to key markets to create a high-profit
enterprise
2. Strengthening of the organizational foundation to face challenges positively
3. Strengthening ties with stakeholders to be a valuable company
Under this management policy, we worked to expand sales of high value-added products inmainstay markets in each domain including the core categories of food solutions, health support,
and biomedical. In September 2021, in order to reinforce our business foundation, we started
construction on a new research facility called the “Mirai Kan” (with completion planned forautumn 2022) to consolidate our production of biomedical products and research anddevelopment functions of all business divisions as well as create products that will lead to new
businesses. Additionally, we strived to improve advertising of products geared toward general
consumers and to improve the visibility of our company and products.
As a result, net sales decreased 2.2% year on year to ¥14,863 million due to the decline in sales
associated with the transfer of the adhesives business in the previous fiscal year. In addition,
operating income decreased 8.4% to ¥593 million due to the impacts of an increase intransportation costs, etc., ordinary income increased 7.4% to ¥696 million attributed to thebooking of foreign exchange gains, and accordingly, net income attributable to owners of parent
increased 6.3% to ¥374 million.
The Nitta Gelatin Group's collagen business is the Company’s only reporting segment. An
overview of the performance of each sales category is as follows:
Food Solutions
In the food solutions category, sales were strong in Japan offsetting the downturn in sales seen in
North America, resulting in a net increase in sales for the segment.
In Japan, sales of products for use in gummy candies increased, driven by strong sales of new
products by customers. In addition, net sales were buoyed by the success of increased sales of2

products for use in chilled desserts and for use in direct marketing sales in the food-service
industry. Meanwhile, sales of products for delicatessen items for convenience stores were on parwith the previous year.
Overseas, net sales of products used in gummy candies and others declined in North America.
As a result, overall sales in the food solutions category increased 3.9% year on year to ¥6,080
million.
Health Support
In the health support category, sales from exports of gelatin for capsules declined due to theslowdown in maritime container transportation, but sales of collagen peptide for health andbeauty applications increased overseas and in Japan, resulting in a net increase in sales for thesegment.
In Japan, there was a recovery in in-store sales while sales of new collagen products forcustomers remained strong, helping to boost net sales of collagen peptide for health and beauty
applications and gelatin for capsules.
Overseas, net sales of collagen peptide increased on the recovery in demand for collagen
peptide products used in health and beauty applications in North America. In Asia, demand forcollagen peptide for health and beauty applications that advertise functionality remained robust,
resulting in increased sales. Meanwhile, net sales of gelatin for capsules declined amid thecontinued stagnation in maritime container transportation, despite strong demand from rising
health consciousness and infection prevention needs during the COVID-19 pandemic. In India,
sales for capsules for pharmaceutical and health food applications were firm and sales of collagen
peptide increased, resulting in an increase in net sales.
As a result, overall sales in the health support category increased 4.6% year on year to ¥7,115
million.
Specialties
In the specialties category, overall sales decreased 34.3% year on year to ¥1,668 million. Thiswas due to the decrease in net sales from the completion of the transfer of the adhesives businessin the previous fiscal year, despite an increase in net sales of gelatin for photography applications
due to the easing of the stay-at-home trend.

(2) Description of Financial Position
1. Assets, Liabilities and Net Assets(Assets)
Total assets amounted to ¥34,215 million at September 30, 2021, ¥700 million lower than at
March 31, 2021. This was mainly attributable to decreases in cash and deposits of ¥1,238 million
and in trade notes and accounts receivable of ¥544 million, which offset an increase ininventories of ¥762 million and in investment securities of ¥433 million.
3

(Liabilities)
Total liabilities stood at ¥14,648 million at September 30, 2021, ¥1,393 million lower than at
March 31, 2021. This was mainly attributable to decreases in long-term loans payable of ¥1,141
million (including loans repayable within one year) and in notes and accounts payable–trade of¥420 million, compared to an increase in short-term loans payable of ¥268 million.
(Net assets)
Net assets amounted to ¥19,567 million at September 30, 2021, ¥693 million higher than at
March 31, 2021. This was mainly attributable to increases in retained earnings of ¥265 million,
valuation difference on other available-for-sale securities of ¥256 million, and foreign currencytranslation adjustments of ¥96 million.
Furthermore, the equity ratio stood at 51.0%, compared with 48.1% at March 31, 2021.
2. Cash Flows
Cash and cash equivalents (“cash”) as of September 30, 2021 was ¥2,772 million, down ¥1,225
million from March 31, 2021.
Cash flows for each activity for the six months ended September 30, 2021 and reasons are as
follows.
(Cash flows from operating activities)
Operating activities provided net cash of ¥332 million, compared to ¥1,486 million in theprevious six months ended September 30, 2020. The main components were income before
provision for income taxes of ¥644 million, depreciation and amortization of ¥665 million,
decrease in notes and accounts receivable-trade of ¥561 million, increase in inventories of ¥732
million, and decrease in notes and accounts payable-trade of ¥461 million.
(Cash flows from investing activities)
Investing activities used net cash of ¥522million, compared to ¥607 million in the previous six
months ended September 30, 2020. This was mainly attributable to ¥470 million in purchase ofproperty, plant and equipment.
(Cash flows from financing activities)
Financing activities used net cash of ¥1,044 million, compared to the provision of ¥14 million in
the previous six months ended September 30, 2020. The main components were the net increasein short-term loans payable of ¥258 million, repayment of long-term loans payable of ¥1,142
million, and cash dividends paid of ¥108 million.

4(3) Description of Consolidated Business Forecasts and Other Forward-looking
Information
The consolidated earnings forecast for the fiscal year ending March 31, 2022 is unchanged fromthe consolidated earnings forecast announced on May 13, 2021 in the “Consolidated Financial
Results for the Fiscal Year Ended March 31, 2021.”
Actual business and other results may differ substantially from projections due to various
factors.

2. Basic Approach to Selection of Accounting Standard
The Nitta Gelatin Group plans to prepare its consolidated financial statements based on Japanese
accounting standards in the near future. This is in consideration of the need to ensure that theconsolidated financial statements can be readily compared between different periods and different
companies.
Looking ahead, considering its management policies and various conditions in Japan andabroad, Nitta Gelatin plans to examine the adoption of International Financial ReportingStandards (IFRS). In doing so, the Group will take into account trends such as the adoption of
IFRS by its peer companies.

53. Quarterly Consolidated Financial Statements and Key Notes(1) Consolidated Balance Sheets(Millions of yen)

Fiscal 2021
(As of March 31, 2021)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable–trade
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
Other, net
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Other
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets

6

1H Fiscal 2022
(As of September 30, 2021)

4,024
6,944
5,069
1,201
2,582
459
(15)
20,266

2,785
6,399
5,722
1,212
2,680
461
(15)
19,247

3,311
2,670
3,127
9,109

3,392
2,415
3,341
9,149

257
244
502

236
238
475

3,205
1,938
(106)
5,036
14,64834,915

3,638
1,812
(108)
5,343
14,96734,215

(Millions of yen)

Fiscal 2021
(As of March 31, 2021)
Liabilities
Current liabilities
Notes and accounts payable–trade
Short-term loans payable
Current portion of long-term loans payable
Income taxes payable
Provision for bonuses
Other
Total current liabilities
Noncurrent liabilities
Long-term loans payable
Net defined benefit liability
Other

1H Fiscal 2022
(As of September 30, 2021)

2,953
1,964
2,080
194
209
2,228
9,630

2,532
2,232
1,806
112
174
2,267
9,126

3,925
1,598
886

3,057
1,580
883

Total noncurrent liabilities
Total liabilities
Net Assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury stock

6,410
16,041

5,521
14,648

3,144
2,966
9,690
(200)

3,144
2,965
9,956
(179)

Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on other available-for-salesecurities
Deferred gains (losses) on hedges
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

15,601

15,887

1,125

1,381

3
(82)
145
1,192
2,079
18,87334,915

(8)
14
166
1,552
2,126
19,56734,215

7

(2) Consolidated Statements of Income and Consolidated Statements ofComprehensive Income
Consolidated Statements of Income(First half consolidated cumulative accounting period)(Millions of yen)

Six Months Ended
September 30, 2020
(From April 1, 2020
to September 30, 2020)
15,196
12,139Net sales
Cost of sales

Six Months Ended
September 30, 2021
(From April 1, 2021
to September 30, 2021)
14,863
11,687Gross profit on sales

3,057

3,175

Selling, general and administrative expenses

2,409

2,582

Operating income

647

593

Non-operating income
Interest income
Dividend income
Rental income
Foreign exchange gains
Equity in earnings of affiliates
Other

3
23
17
28
46

1
39
28
69
29

Total non-operating income

119

169

Non-operating expenses
Interest expenses
Foreign exchange losses
Equity in losses of affiliates
Other
Total non-operating expenses
Ordinary income

61
51
5
118
648

53
8
4
66
696

-

0
0

4
44

0
52
-

48

52

Income before provision for income taxes
Income taxes
Net income

599
156
443

644
190
453

Net income attributable to non-controlling interests

91

79

Net income attributable to owners of the parent

351

374

Extraordinary gains
Gain on sales of noncurrent assets
Total extraordinary gains
Extraordinary losses
Loss on sale of non-current assets
Loss on retirement of noncurrent assets
Impairment loss
Total extraordinary losses

8Consolidated Statements of Comprehensive Income(First half consolidated cumulative accounting period)(Millions of yen)

Six Months Ended
September 30, 2020
(From April 1, 2020
to September 30, 2020)
443

Net income
Other comprehensive income
Valuation difference on other available-for-salesecurities
Deferred gains (losses) on hedges
Foreign currency translation adjustments
Pension liability adjustment
Share of other comprehensive losses of associates
accounted for using equity method
Total other comprehensive income
Total comprehensive income
Comprehensive income attributable to:
Owners of the parent
Non-controlling interests

9

Six Months Ended
September 30, 2021
(From April 1, 2021
to September 30, 2021)
453

30

256

82
(47)
49
(24)

(16)
38
15
65

90
534

359
812

408
125

734
78

(3) Consolidated Statements of Cash Flows(Millions of yen)

Cash flows from operating activities
Income before provision for income taxes
Depreciation and amortization
Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in net defined benefit liability
Interest and dividends income
Interest expenses
Foreign exchange losses (gains)
Equity in losses (earnings) of affiliates
Loss (gain) on sales of property, plant and equipment
Loss on retirement of noncurrent assets
Impairment loss
Loss (gain) on sales of investment securities
Decrease (increase) in notes and accounts receivable-trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable-trade
Increase (decrease) in accrued consumption taxes
Other
SubtotalInterest and dividends income received
Interest paid
Income taxes (paid) or refund
Net cash provided by operating activities
Cash flows from investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of property, plant and equipment
Proceeds from the sale of property, plant and equipment
Purchase of intangible assets
Payments for retirement of property, plant and equipment
Purchase of investment securities
Proceeds from the sale of investment securities
Other
Net cash used in investing activities

10

Six Months Ended
September 30, 2020

Six Months Ended
September 30, 2021

(From April 1, 2020
to September 30, 2020)(From April 1, 2021
to September 30, 2021)

599
629
22
0
(27)
5
(26)
61
21
(28)
4
44
(5)
357
272
(277)
(148)
(80)
1,425
28
(59)
92
1,486

644
665
23
(0)
(35)
(69)
(41)
53
(6)
8
(0)
52
561
(732)
(461)
28
(231)
459
41
(52)
(116)
332

(7)
10
(605)
0
(14)
(4)
13
0
(607)

(12)
26
(470)
1
(14)
(47)
(4)
0
(522)

(Millions of yen)

Cash flows from financing activities
Net increase (decrease) in short-term loans payable
Proceeds from long-term loans payable
Repayment of long-term loans payable
Proceeds from sale-and-leaseback transactions
Repayments of lease obligations
Cash dividends paid
Purchase of treasury stock
Cash dividends paid to non-controlling interests
Net cash (used in) provided by financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

11

Six Months Ended
September 30, 2020

Six Months Ended
September 30, 2021

(From April 1, 2020 to
September 30, 2020)(From April 1, 2021 toSeptember 30, 2021)

(84)
1,700
(1,205)
43
(107)
(110)
(199)
(21)
14
(6)
885
1,381
2,267

258
(1,142)
77
(98)
(108)
(30)
(1,044)10(1,225)
3,998
2,772

(4) Notes to Quarterly Consolidated Financial Statements(Note Concerning Going Concern Assumption)
None(Note Concerning Significant Changes in Shareholders’ Equity)
The Company disposed of 30,800 shares of treasury stock effective July 30, 2021 as restricted
share-based remuneration based on a resolution at the Board of Directors meeting held on July 15,
2021.
As a result, treasury stock decreased by ¥20 million and capital surplus by ¥0 million in thefirst half of the year ending March 31, 2022.
(Changes in Accounting Policies)(Application of Accounting Standard for Revenue Recognition, etc.)
The Company applied the Accounting Standard for Revenue Recognition (ASBJ Statement
No. 29, March 31, 2020, ASBJ; below, “Accounting Standard for Revenue Recognition”)
from the start of the first quarter. The Company now recognizes revenue in the amount
expected to be received in exchange for goods and services at the point in time when thecontrol of the promised goods and services are transferred to the customer.
As a result, sales commissions and sales promotion costs conventionally recorded in selling,
general and administrative expenses have been deducted from net sales.
This change in accounting policy is applied retroactively, in principle, and the quarterly
consolidated financial statements and consolidated financial statements reflect this change forthe previous quarter and previous fiscal year. However, the following methods are applied as
stipulated in Paragraph 85 of the Accounting Standard for Revenue Recognition.
I. Information for comparison within contracts that recognized the amount of nearly all
revenue following the previous handling until the start of the previous fiscal year will not
be revised retroactively.
II. Information for comparison regarding the amount of variable consideration included incontracts that recognized the amount of nearly all revenue following the previous
handling until the start of the current fiscal year will be revised retroactively using theamount at the time the uncertainty concerning the amount of the variable consideration iseliminated.
III. Consolidated quarterly financial statements for the previous fiscal year will not be revised
retroactively regarding contracts that were started and ended within the previous fiscal
year.
IV. Information for comparison will be revised retroactively for contractual changes madeprior to the start of the previous fiscal year by using accounting treatment based on thecontractual conditions after reflecting all contractual changes.
As a result, compared to prior to retroactive application, net sales decreased by ¥8 million
12

in the previous six months ended September 30, 2020 and selling, general and administrative
expenses decreased by ¥8 million, but operating income, ordinary income, and income before
provision for income taxes were not affected. Furthermore, in accordance with the transitional
handling stipulated in Paragraph 28-15 of the "Accounting Standard for Quarterly Financial
Statements" (ASBJ Statement No. 12; March 31, 2020), the Company does not include
information that breaks down revenue arising from contracts with customers pertaining to theprevious six months ended September 30, 2020.
(Application of Accounting Standard for Fair Value Measurement, etc.)
The Company applied the Accounting Standard for Fair Value Measurement (ASBJ Statement
No. 30, July 4, 2019, ASBJ; below, “Accounting Standard for Fair Value Measurement”) fromthe start of the first quarter. Following the transitional handling stipulated in Paragraph 19 of
the Accounting Standard for Fair Value Measurement and Paragraph 44-2 of the AccountingStandard for Financial Instruments (ASBJ Statement No. 10, July 4, 2019), the Company will
apply the new accounting policy set forth in the Accounting Standard for Fair Value
Measurement for all future years. There are no impacts on the Company’s quarterly
consolidated financial statements as a result of this change.
(Additional Information)
There are no major changes to the assumptions about the impacts of the COVID-19 pandemic
that were included in the “Important Accounting Estimates” section of the Annual Securities
Report for the Fiscal Year Ended March 31, 2021.
(Segment Information)
Segment Information
I. Six Months Ended September 30, 2020
(April 1, 2020 to September 30, 2020)
The Nitta Gelatin Group's collagen business has become the Company’s only reporting
segment, so information is omitted.
II. Six Months Ended September 30, 2021
(April 1, 2021 to September 30, 2021)
The Nitta Gelatin Group's collagen business has become the Company’s only reporting
segment, so information is omitted.

13