Business Results for the First Quarter of the Year Ending December 31, 2022
[Japan GAAP] (Consolidated)
May 9, 2022

Company:
Stock code:
Representative:
Contact:

The Pack Corporation

3950
Hideaki Yamashita, President & CEO
Michihisa Fujii, Managing Director, Corporate Division
TEL: +81-6-4967-1221
Expected filing date for quarterly securities report:
May 11, 2022
Expected starting date of dividend payment:
Quarterly supplementary financial documents:
None
Quarterly results briefing:
None

Listed on TSE, Prime Market
URL: https://www.thepack.co.jp(Rounded down to million yen)
1. Consolidated business results for the first quarter of the year ending December 31, 2022
(January 1, 2022 through March 31, 2022)(1)

Consolidated operational results (cumulative)(% change from same quarter of previous year)

Net sales

Operating profit

Profit attributable toowners of parent

Ordinary profit

Million yen%

Million yen%

Million yen%

Million yen%

First quarter of year ending
December 31, 2022

19,098

7.1

908

15.7

1,040

24.2

717

26.3

First quarter of year ended
December 31, 2021

17,832-785(17.8)

837(16.3)

568(8.1)(Note) Comprehensive income

First quarter of year ending December 31, 2022:
First quarter of year ended December 31, 2021:

Quarterly basic
earnings per share

831 million yen (−15.2%)
980 million yen (–%)

Quarterly diluted
earnings per share

Yen

Yen

First quarter of year ending December 31, 2022

37.78

37.75

First quarter of year ended December 31, 2021

29.92

29.88

(Note) The Accounting Standard for Revenue Recognition (ASBJ Statement No. 29) and related guidance have been applied since thebeginning of the first quarter of the consolidated fiscal period under review. Figures for the first quarter of the year ended
December 31, 2021 reflect the retroactive application of these standards. As a result, no year-on-year change is shown for net
sales in the first quarter of the year ended December 31, 2021.

(2)

Consolidated financial position
Total assets

Net assets

Capital adequacy ratio

Million yen

Million yen%

First quarter of year ending December 31, 2022

85,20562,38873.2

Year ended December 31, 2021

87,422

62,032

70.9(Reference) Owner’s equity

First quarter of year ending December 31, 2022:
Year ended December 31, 2021:

62,328 million yen
61,955 million yen

2. Dividends
Dividend per share
End of 1Q

End of 2Q

End of 3Q

Yen

Yen

Yen

Yen

Yen

Year ended December 31, 2021

-

25.00

-

25.00

50.00

Year ending December 31, 2022

30.00

-

30.00

60.00

Year ending December 31, 2022 (forecast)Year-end

Total(Note) Revision from most recently announced dividends forecast: None

3. Forecast of consolidated results for the year ending December 31, 2022
(January 1, 2022 through December 31, 2022)(% change from the previous corresponding period)
Net sales

Operating profit

Ordinary profit

Million yen%

Million yen%

Million yen

38,000

-

1,600

-

Full year
83,0004,700(Note) Revision from most recently announced forecast of results: None-

Second half (accumulated)

Basic
Profit attributableearnings per
to owners of parent
share% Million yen

%

Yen

1,900

-

1,300

-

68.43

5,000

-

3,500

-

184.25*Notes(1)

Material changes in subsidiaries during this quarterly cumulative period (changes in scope of consolidations resulting
from change in subsidiaries): None

(2)

Application of special account processing in preparation of quarterly financial statements: None

(3)

Changes in accounting policies, accounting estimates, and retrospective restatement
1) Changes in accounting policies based on revisions of the accounting standard: Yes
2) Changes in accounting policies other than ones based on revisions of the accounting standard: None
3) Changes in accounting estimates: None
4) Retrospective restatement: None(4)

Number of issued and outstanding shares (common stock)1)

Number of issued and outstanding
1Q, year ending
shares at the end of fiscal year
December 31, 2022
(including treasury shares)

19,900,000 sharesYear ended
December 31, 2021

19,900,000 shares

2)

Number of treasury shares at theend of fiscal year

1Q, year ending
December 31, 2022

899,117 sharesYear ended
December 31, 2021

904,917 shares

3)

Average number of shares(quarterly cumulative)

1Q, year ending
December 31, 2022

18,996,533 shares

1Q, year ended
December 31, 2021

18,990,765 shares* The quarterly financial summary is not subject to audits by certified public accountants or auditing firms.
* Explanation regarding appropriate use of business forecasts and other special instructions
Forward-looking statements regarding future performance are based on assumptions regarding various factors affecting
business performance and information available to the Company’s management as of the date the materials wereprepared. Actual results may differ significantly from forecasts.
Also see “Explanation Regarding Consolidated Business Forecasts and Other Forward-Looking Statements” on p. 3 of
the Attachments concerning forward-looking statements.

The Pack Corporation (3950) Financial Report for the First Quarter of 2022

Contents of Attachments
1.
(1)
(2)
(3)

Overview of Operational Results
Quarterly Operational Results
Quarterly Financial Position
Explanation Regarding Consolidated Business Forecasts and Other Forward-Looking Statements

2
2
3
3

2.
(1)
(2)
(3)

Quarterly Consolidated Financial Statements and Notes
Quarterly Consolidated Balance Sheet
Quarterly Consolidated Statement of Income and Consolidated Statement of Comprehensive Income
Notes to Quarterly Consolidated Financial Statements(Going Concern Assumption)(Significant Changes in Shareholders’ Equity)(Changes in Accounting Policies)

4
4
6
8
8
8
8

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The Pack Corporation (3950) Financial Report for the First Quarter of 2022

1. Overview of Operational Results(1)

Quarterly Operational Results

The Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020; “Revenue Recognition
Accounting Standard” hereinafter) and related guidance have been applied since the beginning of the first quarter of theconsolidated fiscal period under review. Comparison and analysis with the cumulative period through the same quarter ofthe previous consolidated fiscal year and with the previous consolidated fiscal year reflect the retroactive application of the
Revenue Recognition Accounting Standard and related guidance. For more information, see “2. Quarterly Consolidated
Financial Statements and Notes: (3) Notes to Quarterly Consolidated Financial Statements (Changes in Accounting Policies):(Application of Accounting Standard for Revenue Recognition and Related Guidance).”
In the first quarter of the consolidated fiscal year under review, Japan’s economy resumed a downward trend in consumer
spending due to quasi-states of emergency and other priority measures enacted in numerous regions in response to the rapid
spread of the COVID-19 omicron variant. Nevertheless, the impact proved milder than that of the state of emergency in theprevious year, and the economy witnessed a gradual recovery. Various factors continue to generate uncertainty, including
the domestic and international economic impact of new COVID-19 variants; geopolitical issues, including trends in raw
material prices resulting from the Ukrainian crisis and other developments; and the impact of US monetary policy.
In the United States, progress with COVID-19 vaccinations prompted more people to venture out of their homes. The
resulting recovery in consumer spending, centered on the services industries, led to continuing growth in business activity.
While China’s economy got off to a strong start, the effects of the COVID-19 pandemic, including lockdowns in Shanghai
based on the nation’s zero-COVID policy, have led to concerns of slowing economic activity.
The COVID-19 pandemic also affected Group business performance. However, based on the slogan “Marking Our 70th
Anniversary with Rapid Progress,” group companies worked collectively to increase earnings by venturing into new markets,making substantial capital expenditures, and improving quality management.
During the first quarter of the consolidated fiscal year under review, net sales grew by 7.1% year on year to 19,098 million
yen; operating profit rose 15.7% to 908 million yen; ordinary profit grew 24.2% to 1,040 million yen; and profit attributableto owners of parent improved 26.3% to 717 million yen.
The business performance for each segment is given below.
(Paper Products)
The paper products segment accounted for 70.4% of consolidated sales in the first quarter. Sales of paper bags, which
accounted for 28.2% of consolidated sales, are recovering from a sales slump attributable to earlier slowing in consumer
spending. The overseas subsidiaries The Pack (Shanghai) Corporation and The Pack America Corp. recorded strong
performance, with net sales of paper bags growing 11.4% year on year to 5,376 million yen.
Sales of folding paper cartons, which accounted for 24.1% of consolidated sales, grew 9.9% to 4,609 million yen. Sales ofcartons for takeout/delivery food products and to the e-commerce sector remained firm. The Pack (Shanghai) Corporation
also recorded strong sales to manufacturers.
Driven by solid sales to the manufacturing and e-commerce sectors, sales of corrugated boxes, which accounted for 15.4%
of consolidated sales, grew 5.0% to 2,951 million yen.
Printing sales, which accounted for 2.7% of consolidated sales, rose 1.7% to 510 million yen based on strong sales at Keihin
Tokushu Printing Corp. and NIKKO PRINT CORPORATION.
Overall, sales in this segment grew 9.1% to 13,448 million yen. Operating profit rose 17.9% to 876 million yen.

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The Pack Corporation (3950) Financial Report for the First Quarter of 2022

(Film Packaging)
The film packaging segment accounted for 14.1% of consolidated sales during the quarter under review. Segment sales wereup 4.4% to 2,691 million yen despite declining sales of disposable diaper products. These results reflected strong sales offlexible film packaging for food product packages and strong performance by The Pack America Corp. Operating profit,
however, fell 14.6% to 83 million yen.
(Other Businesses)
Other businesses in the quarter under review accounted for 15.5% of consolidated sales. Despite declining sales of
miscellaneous supplies to major retailers, Kannaru Printing Co., Ltd. recorded strong sales of miscellaneous supplies to
medical institutions. This, combined with the strong performance of The Pack America Corp., resulted in sales growth of
1.2% to 2,959 million yen and 10.2% growth in operating profit to 197 million yen attributable in part to improvements inlogistics costs.
(2)

Quarterly Financial Position

Assets totaled 85,205 million yen at the end of the quarter under review, down 2,217 million yen from the end of 2021.
Major factors included increases of 1,759 million yen in cash and deposits and 1,005 million yen in securities offset by
declines of 4,361 million yen in notes and accounts receivable-trade and 942 million yen in investment securities.
Liabilities fell 2,573 million yen to 22,816 million yen. The primary factors were declines of 1,818 million yen in notes andaccounts payable-trade and 577 million yen in income taxes payable.
Net assets grew by 356 million yen to 62,388 million yen. The key factors were increases of 242 million yen in retained
earnings and 133 million yen in foreign currency translation adjustment.
(3)

Explanation Regarding Consolidated Business Forecasts and Other Forward-Looking Statements

Consolidated business forecasts remain unchanged from the information announced February 7, 2022.

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The Pack Corporation (3950) Financial Report for the First Quarter of 2022

2. Quarterly Consolidated Financial Statements and Notes(1)

Quarterly Consolidated Balance Sheet(Million yen)Previous fiscal year
(as of December 31, 2021)

First quarter of current fiscal year
(as of March 31, 2022)

AssetsCurrent assets
Cash and deposits

15,077

16,837

Notes and accounts receivable-trade

21,003

16,642

Securities

12,006

13,011

Merchandise and finished goods

4,768

5,199

Work in process

867

921

Raw materials and supplies

794

875

Other

934

783

Allowance for doubtful accounts

(13)

(14)

55,43854,257

Buildings and structures, net

6,169

6,094

Machinery, equipment, and vehicles, net

6,159

5,861

348

380

Land

8,539

8,539

Construction in progress

1,441

1,580

Total property, plant and equipment

22,65822,456643

677

Investment securities

7,405

6,463

Deferred tax assets

416

492

Other

907

906

Allowance for doubtful accounts

(48)

(47)

Total investments and other assets

8,682

7,814

31,98430,94887,42285,205

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

Tools, furniture and fixtures, net

Intangible assets
Investments and other assets

Total non-current assets
Total assets-4-

The Pack Corporation (3950) Financial Report for the First Quarter of 2022

(Million yen)Previous fiscal year
(as of December 31, 2021)

First quarter of current fiscal year
(as of March 31, 2022)

Liabilities
Current liabilities
Notes and accounts payable-trade

12,235

10,417

Electronically recorded obligations-operating

5,521

5,818

Current portion of long-term loans payable

25

25

Income taxes payable

991

413

Provision for bonuses

267

690

Provision for bonuses for directors (and other officers)

32

14

Other

3,206

2,418

Total current liabilities

22,27919,797Long-term loans payable

60

53

Deferred tax liabilities

440

429

2,434

2,382

176

153

3,110

3,019

25,39022,816

Capital stock

2,553

2,553

Capital surplus

3,164

3,163

Retained earnings

57,64057,883

Treasury shares(2,704)(2,686)

Total shareholders’ equity

60,65460,914

1,212

1,192

0

4

Foreign currency translation adjustment

(98)

34

Remeasurements of defined benefit plans

185

181

1,300

1,414

Share acquisition rights

63

46

Non-controlling interests

13

13

62,03262,38887,42285,205

Non-current liabilities

Retirement benefit liability
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity

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

Total accumulated other comprehensive income

Total net assets
Total liabilities and net assets-5-

The Pack Corporation (3950) Financial Report for the First Quarter of 2022

(2)

Quarterly Consolidated Statement of Income and Consolidated Statement of Comprehensive Income

Quarterly Consolidated Statement of Income
Cumulative period through first quarter
Cumulative period through firstquarter of previous fiscal year
(from January 1, 2021
to March 31, 2021)(Million yen)
Cumulative period through firstquarter of current fiscal year
(from January 1, 2022
to March 31, 2022)

Net sales
Cost of sales

17,832
13,57819,098
14,541Gross profit

4,253

4,557

882
829
106
0
168
7
69
88
622
691

897
837
113
(0)
208
7
58
90
664
771

Selling, general and administrative expenses
Freightage and packing expenses
Salaries and allowances
Director compensation
Provision of allowance for doubtful accounts
Provision for bonuses
Provision for director bonuses
Retirement benefit expenses
Depreciation
Rent expenses
Other

3,468

3,649

Operating profit

Total selling, general and administrative expenses

785

908

Non-operating income
Interest income
Dividend income
Rent income
Compensation income
Foreign exchange gains
Other

25
0
13
6
10

22
3
12
65
6
25

57

137

0
2
1

0
2
2

4

4

837

1,040

-

0

-

0

3
-

5
21

Total non-operating income
Non-operating expenses
Interest expenses
Cost of lease revenue
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of non-current assets
Total extraordinary income
Extraordinary losses
Loss on retirement of non-current assets
Loss on sales of investment securities
Total extraordinary losses

327

Profit before income taxes

834

1,013

Income taxes-current
Income taxes-deferred

359
(92)

375
(79)

Total income taxes

266

295

Profit567

717

Profit (loss) attributable to non-controlling interests

(0)

(0)

Profit attributable to owners of parent

568

717

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The Pack Corporation (3950) Financial Report for the First Quarter of 2022

Quarterly Consolidated Statement of Comprehensive Income
Cumulative period through first quarter
Cumulative period through firstquarter of previous fiscal year
(from January 1, 2021
to March 31, 2021)(Million yen)
Cumulative period through firstquarter of current fiscal year
(from January 1, 2022
to March 31, 2022)

567

717

298

(19)

1

3

108

133

4

(3)

412

114

980

831

Comprehensive income attributable to owners of parent

980

831

Comprehensive income attributable to non-controllinginterests

00ProfitOther 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
Total other comprehensive income
Comprehensive income(Comprehensive income attributable to)-7-

The Pack Corporation (3950) Financial Report for the First Quarter of 2022

(3)

Notes to Quarterly Consolidated Financial Statements(Going Concern Assumption)
Not applicable.
(Significant Changes in Shareholders’ Equity)
Not applicable.
(Changes in Accounting Policies)(Application of Accounting Standard for Revenue Recognition and related guidance)
The Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020) and the Implementation
Guidance on Accounting Standard for Revenue Recognition (ASBJ Guidance No. 30, March 26, 2021) (“AccountingStandard for Revenue Recognition and related guidance” hereinafter) have been applied since the beginning of the firstquarter of the consolidated fiscal period under review. Accordingly, revenue is now recognized in the amount expected
to be received in exchange for goods or services at the point in time at which control of promised goods or services
shift to the customer.
Before, in transactions in which the Group functioned as an agent (i.e., supplying products to customers), all payments
received from the customer were recognized as revenues. Now, following this change, revenues are recognized as the
net amount after deducting the amount to be paid to our supplier from payments made by the customer.
In principle, the quarterly consolidated financial statements and annual consolidated financial statements herein reflect
the retroactive application of this change to quarters in the previous fiscal year and to the previous consolidated fiscal
year.
Compared to previous account processing, the change has resulted in a decrease of 138 million yen in each of net sales
and cost of sales for the cumulative period through the first quarter of the previous consolidated fiscal year.
(Application of the Accounting Standard for Fair Value Measurement and related standards)
The Accounting Standard for Fair Value Measurement (ASBJ Statement No. 30, July 4, 2019; “Accounting Standard
for Fair Value Measurement” hereinafter) and related standards have been applied since the beginning of the firstquarter of the consolidated fiscal period under review. Pursuant to the transitional handling described in Paragraph 19of the Accounting Standard for Fair Value Measurement and Paragraph 44-2 of the Accounting Standard for Financial
Instruments (ASBJ Statement No. 10, July 4, 2019), the new accounting policies specified in the Accounting Standard
for Fair Value Measurement and related standards will be applied to future accounts. This change does not affect thequarterly consolidated financial statements.

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