Consolidated Basis Results of the Third Quarter for Fiscal 2020
(April 1, 2020 - December 31, 2020)
February 2, 2021
TOPY INDUSTRIES, LIMITED
Stock listing: Tokyo, Nagoya stock exchanges
7231
URL: http://www.topy.co.jp/
Nobuhiko Takamatsu, President and CEO
Shuichi Tachibana, Operating Officer, General Manager, General Affairs Department
Telephone: 03-3493-0777 / (Overseas) 81-3-3493-0777
Scheduled date for submission of securities report: February 10, 2021
Scheduled date for dividend payment:
Preparation of supplementary explanatory materials: No
Holding of quarterly financial results meeting:No
Registered Company name:
Code number:
Representative:
Contact:(Figures of less than ¥1 million have been omitted)
1. Consolidated Financial and Operating Results of the Third Quarter for Fiscal 2020 (April 1, 2020 - December 31, 2020)(1) Consolidated Operating Results (Cumulative)(Percentage figures are changes from the same period of the previous fiscal year)
Profit attributable to
Net sales
Operating profit
Ordinary profit
owners of parent
Million yen

Third Quarter of Fiscal 2020
Third Quarter of Fiscal 2019
(Note) Comprehensive income:

161,030
202,628%

Million yen%(20.5)(2,491)(1,033)(4.7)
3,881(27.1)
3,941(29.4)
Third Quarter of Fiscal 2020¥111 million -96.7%
Third Quarter of Fiscal 2019
¥3,409 million -81.2%%(2,165)2,519(34.2)

Basic earnings per share

Million yen%

Diluted earnings
per share

Yen

Third Quarter of Fiscal 2020
Third Quarter of Fiscal 2019

Million yen

Yen(92.24)107.22-(2) Consolidated Financial Results
Total assets

Net assets

Million yen

Third Quarter of Fiscal 2020
Fiscal 2019(For reference) Shareholders’ equity:

Capital adequacy ratio

Million yen

265,751
103,646
254,659
103,800
Third Quarter of Fiscal 2020 ¥102,701 million
Fiscal 2019
¥102,732 million

Net assets per share

%

Yen

38.6
40.3

4,408.51
4,372.66

2. Dividends
Base date

Dividends per share
End of first quarter

Fiscal 2019
Fiscal 2020

End of Third quarter End of third quarterEnd of fiscal year

Full fiscal year

Yen

Yen

Yen

Yen

Yen

-

40.00
0.00

-

0.00

40.00

-

20.00

20.00

Fiscal 2020 (Forecasts)(Note) Whether changes to the latest dividend forecasts have been made: No

3. Consolidated Financial Forecasts for Fiscal 2020 (April 1, 2020 - March 31, 2021)(Percentage figures are changes from the same period of the previous fiscal year)
Profit attributable toProfit per
Net sales
Operating profit
Ordinary profit
owners of parent
shareMillion yen%

Million yen%

Million yen

Fiscal 2020
217,000(17.6)(2,500)(1,500)(Note) Whether changes to the latest forecasts for consolidated figures have been made: No%

Million yen(2,500)%-Yen(106.39)

* NOTE(1) Changes in the State of Material Subsidiaries during the Period: No
Newly included: - (Name) Excluded: -(Name) -(2) Adoption of Special Accounting Methods for the Preparation of Quarterly Consolidated Financial Statements: Yes
Note: For details, please refer to “Application of Special Accounting Methods for Presenting Quarterly Consolidated Financial Statements.”(3) Changes in Accounting Principles, Changes in Accounting Estimates, and Retrospective Restatements(a) Changes in accounting principles accompanying the amendment of accounting standards: None(b) Changes other than those in (a) above: None(c) Changes in accounting estimates: None(d) Retrospective restatements: None
(4) Number of Shares Issued (Common shares)(a) Number of shares issued at the end of the period (including treasury stock)
Third Quarter of Fiscal 2020
24,077,510 sharesFiscal 2019(b) Number of treasury stock at the end of the period
Third Quarter of Fiscal 2020
781,413 sharesFiscal 2019(c) Average number of shares issued during the period
Third Quarter of Fiscal 2020
23,475,762 shares
Third Quarter of Fiscal 201924,077,510 shares
583,315 shares
23,495,011 shares* These consolidated financial results are not included in the scope of quarterly audits by certified public accountants or audit
corporations.
* Explanation of the Appropriate Use of Performance Forecasts and Other Related Items(Caution concerning future descriptions etc.)
The above estimate has been compiled based on information available at the time this disclosure was made. The actual earnings
are subject to change from the estimated values due to various factors. For assumed conditions underlying the earnings forecast
and cautionary statements in using the earnings forecast, please refer to “Explanation Regarding Future Estimate Information
Such as Consolidated Financial Performance Estimates.”Index of Attached Documents
1. Qualitative Information Regarding Results of the Third Quarter for Fiscal 2020 ....................................................................

2(1) Explanation Regarding Consolidated Operating Results ....................................................................................................

2(2) Explanation Regarding Financial Status .............................................................................................................................

2(3) Explanation Regarding Future Estimate Information such as Consolidated Financial Performance Estimates ..................

3

2. Quarterly Consolidated Financial Statements and Important Notes .........................................................................................

4(1) Quarterly Consolidated Balance Sheets ..............................................................................................................................

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

6

Quarterly Consolidated Statements of Income
Third Quarter Consolidated Cumulative Accounting Term ......................................................................................

6

Quarterly Consolidated Statements of Comprehensive Income
Third Quarter Consolidated Cumulative Accounting Term ......................................................................................

7(3) Notes Regarding Quarterly Consolidated Financial Results ...............................................................................................

8(Note Related to Going Concern) .....................................................................................................................................

8(Note on Significant Changes in the Amount of Shareholders’ Equity)............................................................................

8(Application of Special Accounting Methods for Presenting Quarterly Consolidated Financial Statements) ..................

8

Note: This document has been translated from the original Japanese version for reference purposes only. In the event of any
discrepancy between this translated document and the original Japanese version, the original shall prevail.
The original disclosure in Japanese was released on February 2, 2021 at 13:30 (GMT+9).
The Company assumes no responsibility for this translation or for direct, indirect or any other forms of damages arising from thetranslation.

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1. Qualitative Information Regarding Results of the Third Quarter for Fiscal 2020
(1) Explanation Regarding Consolidated Operating Results
During the first nine months of the fiscal year under review, the global economy suffered a severe downturn caused by the
COVID-19 pandemic. Although there were signs of recovery, the United States, Europe and Southeast Asia continued to facedifficult conditions. As domestic and overseas economic activities restarted, the Japanese economy saw improvements inexports and consumer spending. The economy, however, did not achieve a full-scale recovery from the downturn due to
COVID-19 and was sluggish overall.
Under these circumstances, the Group took preventive measures against COVID-19 and focused on ensuring a stable supply
to customers. The Group has established a company-wide management reform committee and has been taking steps to modify
its production systems to promptly respond to a sharp decrease in demand and reduce fixed costs as part of its emergency
measures to bolster its earnings strength. In addition, the Group has worked to optimize its production system in the
Automotive & Industrial Machinery Components Business and implemented the development, sale, etc. of its original productsin the Steel Business. The Group also worked to strengthen its sustainable ESG management base according to the mediumterm business plan, Growth & Change 2021. It started to build sorting equipment to improve iron recycling levels and acquired
the EcoLeaf environmental label, which discloses quantitative environmental information on products over their entire life
cycle, for six steel products.
The financial results for the first nine months of the fiscal year under review include consolidated net sales of ¥161,030
million (down 20.5％ year on year), an operating loss of ¥2,491 million (compared to operating profit of ¥3,881 million in thesame period of the previous year), an ordinary loss of ¥1,033 million (compared to ordinary profit of ¥3,941 million in thesame period of the previous year), and a loss attributable to owners of parent of ¥2,165 million (compared to profit attributableto owners of parent of ¥2,519 million in the same period of the previous year), chiefly reflecting the results in the first half,
despite a recovery in demand and an improvement in earnings in the third quarter.
Performance by Segment(Steel Business)
Demand for steel materials of manufacturing companies in the steel industry fell substantially and the production of crude
steel dropped sharply. The electric furnace industry faced a challenging situation as the price of steel scrap, the main raw
material of steel, rose sharply in the third quarter, reflecting a sharp increase in demand for steel in China, which had recoveredfrom the COVID-19 pandemic.
Given these circumstances, the Group's net sales declined to ¥53,519 million (down 4.6％ year on year) due to a decrease in
selling prices, although the Group focused on exports and sale to the construction industry and the sales amount rose year on
year. Although the Group implemented cost reductions through emergency measures to raise earnings, operating profit fell to¥944 million (down 73.5％ year on year), reflecting a steep rise in steel scrap prices before an improvement in selling prices.
(Automotive & Industrial Machinery Components Business)
In the automotive industry, production decreased significantly worldwide primarily due to sluggish demand and thesuspension of factory operations in Japan and overseas in the first half of the fiscal year, although there are signs of recovery.
The construction machinery industry was on a recovery trend as economic activity resumed in China and other regions, but the
production of hydraulic shovels declined due to weak demand in the first half of the fiscal year. Demand for mining machinery
fell particularly in Southeast Asia.
Given these conditions, the Group considered reform plans for a more profitable business structure and cut costs throughemergency measures. However, due to a significant fall in sales volume, net sales decreased to ¥97,594 million (down 27.5％
year on year), and the operating loss stood at ¥787 million (compared to operating profit of ¥2,672 million in the same periodof the previous year).
(Power Business)
A challenging business environment continued in the power business due to suppression of coal fueled power generation
backed by global warming issues and intensifying price competition. Given these circumstances, the Group worked on thestable supply of electricity in line with its business plan. As a consequence, net sales came to ¥5,520 million (down 19.4% year
on year) and operating profit amounted to ¥175 million (down 63.3% year on year).
(Others)
The Group operated civil engineering and construction business, real estate leasing including Topy-rec Plaza (Minami-suna,
Koto-ku, Tokyo) and a sports club, OSSO, and manufactured and sold synthetic mica and crawler robots. Net sales came to¥4,396 million (down 12.5％ year on year) and operating profit was ¥375 million (down 60.6％ year on year) due to a fall insales from sports club operations and sales of mica in cosmetics, which was caused by COVID-19.
(2) Explanation Regarding Financial Status
Total assets at the end of the third quarter of the consolidated fiscal year under review stood at ¥265,751 million, an increaseof ¥11,092 million from the end of the previous consolidated fiscal year. This was mainly due to increases of ¥7,499 millionand ¥2,037 million in notes and accounts receivable - trade and cash and deposits, respectively.
Total liabilities were ¥162,104 million, an increase of ¥11,246 million compared with the end of the previous consolidated
fiscal year. This was mainly due to an increase of ¥9,842 million in short-term borrowings.
Total net assets came to ¥103,646 million, or a decrease of ¥153 million from the end of the previous consolidated fiscal year.
This was mainly due to an increase of ¥231 million in treasury shares.

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(3) Explanation Regarding Future Estimate Information Such as Consolidated Financial Performance Estimates
The global economic situation is unstable, reflecting restrictions and voluntary restraints on social and economic activities dueto the resurgence of COVID-19 infections and the U.S.-China conflict. The Group's operating environment is likely to remaindifficult.
The full-year consolidated financial forecast has not been changed from the forecast announced on November 5, 2020. Thisdecision has been made based on information available to the Group as of the date of issuance of this release. The actual results
may vary from the forecast due to various factors that will arise in the future.

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2. Quarterly Consolidated Financial Statements and Important Notes(1) Quarterly Consolidated Balance Sheets(Millions of yen)
As of March 31, 2020

As of December 31, 2020

AssetsCurrent assets
Cash and deposits

23,811

25,849Notes and accounts receivable - trade

44,76452,264Merchandise and finished goods

20,70817,924Work in process

5,529

5,685

Raw materials and supplies

14,01813,716

Other

6,271

7,399

Allowance for doubtful accounts

(28)

(54)

115,074

122,784

92,392

92,651

Accumulated depreciation(62,551)(63,899)

Buildings and structures, net

29,841

28,751

Machinery, equipment and vehicles

209,235

211,321

Accumulated depreciation(162,259)(166,355)

46,97644,966Land

15,25615,198

Leased assets

5,141

2,528

Accumulated depreciation(3,625)(1,388)

Leased assets, net

1,515

1,140

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

Machinery, equipment and vehicles, net

Construction in progress

4,778

6,477

Other

43,46043,976(41,383)(42,023)

Accumulated depreciation
Other, net

2,076

1,952

100,445

98,487

Other

4,637

4,071

Total intangible assets

4,637

4,071

24,77429,547

Total property, plant and equipment
Intangible assets

Investments and other assets
Investment securities
Long-term loans receivable

479

482

1,360

1,401

295

295

Other

7,642

8,730

Allowance for doubtful accounts

(50)

(48)

Total investments and other assets

34,50040,407

139,584

142,966

254,659

265,751

Deferred tax assets
Retirement benefit asset

Total non-current assets
Total assets-4-

(Millions of yen)
As of March 31, 2020

As of December 31, 2020

Liabilities
Current liabilities
Notes and accounts payable - trade24,56224,013

Electronically recorded obligations - operating

12,687

16,937

Short-term borrowings

15,49525,338Current portion of bonds payable

5,500

5,500

Lease obligations

433

244

Income taxes payable

502

668

Other

14,872

13,033

Total current liabilities

74,05385,736

Bonds payable

27,30027,300Long-term borrowings

28,486

26,719

572

402

4,649

6,122

175

222

39

36

46

30

290

401

12,285

12,371

Non-current liabilities

Lease obligations
Deferred tax liabilities
Provision for corporate officers' retirement
benefits
Provision for share-based remuneration for
directors (and other officers)
Provision for retirement benefits for directors(and other officers)
Reserve for repairs
Retirement benefit liability
Asset retirement obligations

355

357

Other

2,602

2,402

Total non-current liabilities

76,80576,368150,858

162,104

Share capital

20,983

20,983

Capital surplus

18,606

18,606

Retained earnings

61,44459,279Treasury shares(1,711)(1,943)

Total shareholders' equity

99,32396,925

5,440

8,807

Total liabilities
Net assets
Shareholders' equity

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

(5)

(10)

Foreign currency translation adjustment(1,401)(2,429)Remeasurements of defined benefit plans

(625)

(592)

Total accumulated other comprehensive income

3,409

5,775

Non-controlling interests
Total net assets
Total liabilities and net assets

-5-

1,068

945

103,800

103,646

254,659

265,751

(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive Income(Quarterly Consolidated Statements of Income)(Third Quarter Consolidated Cumulative Accounting Term)(Millions of yen)
Nine months ended

Nine months ended

December 31, 2019

December 31, 2020

Net sales

202,628

161,030

Cost of sales

173,564

141,548

Gross profit

29,063

19,482

Selling, general and administrative expenses

25,182

21,974

Operating profit (loss)

3,881(2,491)

Interest income

54

106

Dividend income

692

657

973

1,283

Subsidies for employment adjustment

－

529

Other

202

258

1,923

2,836

Interest expenses

462

381

Foreign exchange losses

419

604

Other

980

392

1,862

1,378

3,941

(1,033)Gain on sales of non-current assets

15

54

Gain on sales of investment securities

17

19

Total extraordinary income

32

74

2

4

183

128

1

－

Non-operating income

Share of profit of entities accounted for using equity
methodTotal non-operating income
Non-operating expenses

Total non-operating expenses
Ordinary profit (loss)
Extraordinary income

Extraordinary losses
Loss on sales of non-current assets
Loss on retirement of non-current assets
Other
Total extraordinary losses

186

133

Profit (loss) before income taxes

3,787(1,092)

Income taxes

1,228

1,081

Profit (loss)

2,559(2,174)

40

(9)

2,519

(2,165)

Profit (loss) attributable to non-controlling interests
Profit (loss) attributable to owners of parent-6-

(Quarterly Consolidated Statements of Comprehensive Income)(Third Quarter Consolidated Cumulative Accounting Term)(Millions of yen)

Profit (loss)

Nine months ended

Nine months ended

December 31, 2019

December 31, 2020

2,559

(2,174)

1,630

3,360

0

(5)

(546)

(1,062)

29

33

(264)

(39)

850

2,285

3,409

111

3,381

200

28

(89)

Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners ofparentComprehensive income attributable to noncontrolling interests-7-(3) Notes Regarding Quarterly Consolidated Financial Results(Note Related to Going-Concern Assumption)
None(Note on Significant Changes in the Amount of Shareholders’ Equity)
None(Application of Special Accounting Methods for Presenting Quarterly Consolidated Financial Statements)
Tax expenses were calculated by multiplying the rationally estimated effective tax rate after applying tax effect accounting to
profit before income taxes for the consolidated fiscal year, which includes the current Third quarter under review, by profit
before income taxes for the Third quarter.

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