Business Results for the Year Ended December 31, 2021
[Japan GAAP] (Consolidated)
Company:
Stock code:
Representative:
Contact:

February 7, 2022

Listed on TSE, First Section
URL: https://www.thepack.co.jp

The Pack Corporation

3950
Mitsuo Inada, President & CEO
Michihisa Fujii, Managing Director, Corporate Division
TEL: +81-6-4967-1221
Expected date of annual shareholders’ meeting:March 30, 2022
Expected starting date of dividend payment:
March 31, 2022
Expected starting date of filing of annual securities report:
March 30, 2022
Preparation of supplementary financial document: Yes
Results briefing:
Yes (for institutional investors and securities analysts)(Rounded down to million yen)
1. Consolidated business results for the year ended December 31, 2021
(January 1, 2021 through December 31, 2021)(1)

Consolidated operational results(% change from the previous corresponding period)
Net salesYear ended December 31, 2021
Year ended December 31, 2020
(Note) Comprehensive income

Year ended December 31, 2021
Year ended December 31, 2010

Million yen

80,17778,445

Profit attributable toowners of parent% Million yen%
Million yen%
Million yen
%
2.2
4,144
26.6
4,422
22.6
2,824
18.1
(17.9)
3,275(52.2)
3,606 (49.9)
2,392 (49.1)
Year ended December 31, 2021: 3,325 million yen (up 40.4%)
Year ended December 31, 2020: 2,368 million yen (down 50.3%)
Operating profit

Basic earnings
per shareYen
148.71126.01(Reference) Investment earnings/loss on equity-method(2)

Diluted earnings
per shareYen
148.53125.85Return on equity
%
4.6
4.1

Ratio of ordinary
profit to total assets
%
5.2
4.2

Ratio of operating
profit to net sales
%
5.2
4.2

Year ended December 31, 2021: - million yen
Year ended December 31, 2020: - million yen

Consolidated financial position
Total assets

Million yen

87,422
83,556(Reference) Owner’s equity

Capital adequacy
ratio

Net assets

Million yen

Year ended December 31, 2021
Year ended December 31, 2020(3)

Ordinary profit

62,032
59,739Net assets per share

%
70.9
71.4

Yen
3,261.64
3,141.09

As of December 31, 2021: 61,955 million yen
As of December 31, 2020: 59,651 million yen

Consolidated cash flows
Cash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities

Cash and cash equivalents
at end of period

Million yen

Million yen

Million yen

Million yen

Year ended December 31, 2021
Year ended December 31, 2020

7,217
3,155

(3,460)(5,013)(1,029)(1,214)18,067
15,224

2. Dividends
Dividend per share
End of 1Q End of 2Q End of 3Q
Year ended December 31, 2020
Year ended December 31, 2021
Year ending December 31, 2022
(forecast)Year-end

Total

Yen
-

Yen
30.00
25.00

Yen
-

Yen
30.00
25.00

Yen
60.00
50.00

-

30.00

-

30.00

60.00

Ratio of total
Dividend
dividend to net
payout ratio
assets(Consolidated)(Consolidated)
Million yen
%
%
1,138
47.6
1.9
1,044
33.6
1.6
Total
dividends(Total)32.6

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)
Basic
Profit attributableearnings per
to owners of parent
shareMillion yen % Million yen% Million yen% Million yen%
Yen
First half (accumulated)
38,000
1,600
1,900
1,300
68.43
Full year
83,000
4,700
5,000
3,500
184.25(Note) The Accounting Standard for Revenue Recognition (ASBJ Statement No. 29) and other standards will apply from the
beginning of the year ending December 31, 2022. Forecasts of consolidated results represent figures after the application ofthese standards, and changes from the previous corresponding period are omitted.
Net sales

Operating profit

Ordinary profit*Notes(1)

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

(2)

Changes in accounting policies, accounting estimates, and retrospective restatement
1) Changes in accounting policies based on revisions of the accounting standard: None
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(3)

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

Number of issued and outstanding shares at the end of fiscal year (including treasury shares)
As of December 31, 2021:

2)

As of December 31, 2020:

19,900,000 shares

904,917 shares

As of December 31, 2020:

909,347 shares

18,993,765 shares

As of December 31, 2020:

18,986,206 shares

Number of treasury shares at the end of fiscal year
As of December 31, 2021:

3)

19,900,000 shares

Average number of shares
As of December 31, 2021:* The current financial summary is not subject to audit by certified public accountants or auditing firms.
* Explanation regarding appropriate use of business forecasts and other special instructions
Note concerning forward-looking statements
Forecasts regarding future performance in these materials are based on assumptions judged to be valid and information
available to the Company’s management at the time the materials were prepared. They do not represent guarantees by theCompany regarding future performance. Actual results may differ significantly from forecasts for various reasons.

The Pack Corporation (3950) Financial Report for Fiscal Year 2021

Contents of Attachments
1.
(1)
(2)
(3)
(4)

Overview of Operational Results
Operational Results
Financial Position
Cash Flows
Outlook

2
2
3
3
4

2.

Basic Approach to Selecting Accounting Standards

4

3.
(1)
(2)
(3)
(4)
(5)

Consolidated Financial Statement and Notes
Consolidated Balance Sheet
Consolidated Statement of Income and Consolidated Statement of Comprehensive Income
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to Consolidated Financial Statements
Going Concern Assumption
Segment and Other Information
Per Share Information
Material Subsequent Events

5
5
7
9
11
12
12
12
15
15

-1-

The Pack Corporation (3950) Financial Report for Fiscal Year 2021

1. Overview of Operational Results(1)

Operational Results

Japan’s economy in the consolidated fiscal year under review was marked by repeated cycles of slowdowns and recoveries
as restrictions on human activity and movement were repeatedly lifted, then enacted once again in response to states of
emergency declared by the national government and demands for measures to slow the spread of COVID-19 from local
governments. The anticipated economic stimulus of the long-awaited Tokyo Olympics proved limited because the games
were held without spectators. An economic slowdown continued for the entire year. While consumer spending recovered
toward the end of the year as the pandemic slowed, the outlook remains unclear.
The United States economy saw recovery in consumer spending, primarily in the service industries. Progress withvaccinations increased opportunities for consumer activity. Corporate activities also continued to grow. However, the spreadof the omicron variant toward the end of the year led to a rapid increase in COVID-19 case rates and once again constrained
activity. Due to China’s success in controlling the spread of the virus, the Chinese economy continued to recover at a steadypace. Nevertheless, in light of policies to rectify inequalities and more stringent regulations on electric power, the outlook
remains uncertain.
While the COVID-19 pandemic affected Group business performance, we sought to improve business results under theslogan “Refreshed and Moving Forward.” The measures taken included Groupwide efforts to develop new markets,
proactive capital investments, and improvements in quality control.
As a result, in the consolidated fiscal year under review, net sales grew 2.2% year on year to ¥80,177 million; operating
profit grew 26.6% to ¥4,144 million; ordinary profit grew 22.6% to ¥4,422 million; and profit attributable to owners ofparent grew 18.1% to ¥2,824 million.
The business performance for each segment is given below.
(Paper Products)
The paper products segment accounted for 69.2% of consolidated sales in 2021. Sales of paper bags, which accounted for
27.5% of consolidated sales, rose by 2.6% to 22,032 million yen, buoyed by gradual recovery from a sales decline due toslower consumer spending in Japan, as well as by stronger sales at the overseas subsidiaries The Pack (Shanghai) Corporation
and The Pack America Corp.
Sales of folding paper cartons, which accounted for 24.3% of consolidated sales, grew 13.1% to 19,497 million yen. Salesof cartons for takeout/delivery food products remained solid. Sales to manufacturers by The Pack (Shanghai) Corporation
were also strong.
Sales of corrugated boxes, which accounted for 14.8% of consolidated sales, grew 11.5% to 11,850 million yen, a result ofstrong sales to the manufacturing and e-commerce sectors.
Printing sales, which accounted for 2.6% of consolidated sales, grew 3.9% to 2,131 million, driven by strong sales at Keihin
Tokushu Printing Corp. and NIKKO PRINT CORPORATION.
Overall, sales in this segment rose 8.0% to 55,511 million yen. Operating profit rose by 26.7% to 3,958 million yen.
(Film Packaging)
The film packaging segment accounted for 14.0% of consolidated sales in 2021. Segment sales fell 17.1% to 11,184 million
yen due to declining sales of disposable diaper products, lower sales to specialty retail stores in Japan due to COVID-19,
and the impact of a mandatory fee for plastic shopping bags that went into effect on July 1, 2020. Operating profit fell 22.4%
to 397 million yen.
(Other Businesses)
Other businesses accounted for 16.8% of consolidated sales in 2021. Despite steady sales of miscellaneous supplies to large
retailers and strong sales of miscellaneous supplies to medical facilities by Kannaru Printing Co., Ltd., lower sales by-2-

The Pack Corporation (3950) Financial Report for Fiscal Year 2021

NISHINIHON PRINTING Co., Ltd. and The Pack (Shanghai) Corporation led to a 0.7% decline in overall sales to 13,481
million yen. Nevertheless, operating profit rose by 17.9% to 882 million yen thanks to decrease in logistics costs.
(2)

Financial Position

Assets totaled 87,422 million yen at the end of 2021, up 3,866 million yen from the end of 2020. Major factors included
growth of 1,843 million yen in cash and deposits and 2,906 million yen in securities, partially offset by a decrease of 1,698
million yen in investment securities.
Liabilities rose by 1,574 million yen to 25,390 million yen. The primary factors were increases of 1,051 million yen in notes
and accounts payment-trade and 935 million yen in income taxes payable.
Net assets grew by 2,292 million yen to 62,032 million yen. The key factor was an increase of 1,780 million yen in retained
earnings.
(3)

Cash FlowsThe balance of cash and cash equivalents at the end of 2021 rose 2,843 million yen to 18,067 million yen, a 18.7% gain fromthe end of 2020.
<Cash flows from operating activities>
Operating activities provided net cash of 7,217 million yen (up 128.7% from 3,155 million yen in 2020). The principal
factors were profit before income taxes of 4,214 million yen, depreciation of 2,029 million yen, and income taxes paid of
502 million yen.
<Cash flows from investing activities>
Investing activities accounted for net cash of 3,460 million yen (vs. 5,013 million yen in 2020). The principal factors were
outlays of 9,505 million yen for the purchase of securities and 3,219 million yen for the purchase of property, plant, andequipment, while proceeds from sales of securities were 9,607 million yen.
<Cash flows from financing activities>
Due mainly to 1,045 million yen in cash dividends paid, financing activities used net cash of 1,029 million yen (vs. 1,214
million yen in 2020).
Reference: Cash flow indicators
Fiscal years ended
Capital adequacy ratio
Capital adequacy ratio based onmarket prices
Interest-bearing debt to cash flow
ratio
Interest coverage ratio

December 31,
2017
65.1

December 31,
2018
65.5

December 31,
2019
66.0

December 31,
2020
71.4

December 31,
2021
70.9

87.2

69.1

84.7

64.3

58.6

0.0

0.1

0.0

0.1

0.0

8,274.9833.2

2,257.9

2,572.9

5,405.8

Notes:
1. Cash flow indices are calculated as follows using consolidated figures:
Capital adequacy ratio: Owner’s equity/Total assets
Capital adequacy ratio based on market prices: Market capitalization/Total assets
Interest-bearing debt to cash flow ratio: Interest-bearing debt/Operating cash flows
Interest coverage ratio: Operating cash flows/Interest payments
2. Market capitalization is calculated by multiplying the closing share price at the end of the period by the number of issued andoutstanding shares at the end of the fiscal year, net of treasury shares.
3. Interest-bearing debt includes all liabilities on the consolidated balance sheet incurring interest.
4. Operating cash flows and interest payments, respectively, are taken from “Net cash provided by (used in) operating activities” and“Interest expenses paid” on the consolidated statement of cash flows.

-3-

The Pack Corporation (3950) Financial Report for Fiscal Year 2021

(4)

Outlook

Rising COVID-19 case rates due to the omicron variant are expected to impact Japan’s economy in 2022. However, thecourse of this variant in both South Africa and parts of Europe indicates infections may peak after about one month and leveloff fairly quickly, which would lead to consumer spending recovery thereafter.
In light of these business conditions, under the slogan of the Medium-Term Management Plan—Management Focused on
Environmental Responsiveness—The Pack Group established a five-pronged growth strategy: 1) Initiatives related to theshift to paper; 2) promoting sales growth for food products, pharmaceuticals, cosmetics, and the e-commerce sector; 3)
strengthening sales of folding paper cartons; 4) expanding business domains; and 5) strengthening productivity andpromoting workstyle reforms. The Group will work to strengthen customer satisfaction and increase earnings as a company
offering total packaging solutions.
2. Basic Approach to Selecting Accounting Standards
The Pack Group will continue to prepare consolidated financial statements based on Japanese accounting standards. This
will allow comparisons to previous years and to financial data for other companies. We will take appropriate action withregard to the application of International Financial Reporting Standards (IFRS), accounting for the relevant factors in playin Japan and other countries.

-4-

The Pack Corporation (3950) Financial Report for Fiscal Year 2021

3. Consolidated Financial Statement and Notes(1)

Consolidated Balance Sheet
Previous fiscal year
(As of December 31, 2020)(Million yen)
Current fiscal year
(As of December 31, 2021)

Cash and deposits

13,234

15,077

Notes and accounts receivable-trade

20,731

21,003

Securities

9,099

12,006Merchandise and finished goods

AssetsCurrent assets

4,958

4,768

Work in process

763

867

Raw materials and supplies

830

794

Other

555

934

Allowance for doubtful accounts

(13)

(13)

50,16055,438

Buildings and structures, net

6,284

6,169

Machinery, equipment, and vehicles, net

6,989

6,159

355

348

8,302

8,539

616

1,441

22,54722,658190

643

Investment securities

9,104

7,405

Deferred tax assets

583

416

1,022

907

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

Tools, furniture and fixtures, net
LandConstruction in progress
Total property, plant and equipment
Intangible assets
Investments and other assets

Other
Allowance for doubtful accounts

(53)

(48)

Total investments and other assets

10,657

8,682

33,39531,98483,55687,422

Total non-current assets
Total assets-5-

The Pack Corporation (3950) Financial Report for Fiscal Year 2021

Previous fiscal year
(As of December 31, 2020)(Million yen)
Current fiscal year
(As of December 31, 2021)

Notes and accounts payable-trade

11,183

12,235

Electronically recorded obligations-operating

5,330

5,521

Current portion of long-term loans payable

30

25

Income taxes payable

55

991

Provision for bonuses

230

267

Liabilities
Current liabilities

Provision for bonuses for directors (and other officers)

18

32

Other

3,506

3,206

Total current liabilities

20,35622,279Non-current liabilities
Long-term loans payable-

60

Deferred tax liabilities

485

440

2,758

2,434

214

176

3,459

3,110

23,81625,390Capital stock

2,553

2,553

Capital surplus

3,164

3,164

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

Retained earnings

55,86057,640Treasury shares(2,717)(2,704)

Total shareholders’ equity

58,86160,654987

1,212

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

00Foreign currency translation adjustment

(310)

(98)

Remeasurements of defined benefit plans

112

185

Total accumulated other comprehensive income

790

1,300

Share acquisition rights

65

63

Non-controlling interests

22

13

59,73962,032

83,55687,422

Total net assets
Total liabilities and net assets-6-

The Pack Corporation (3950) Financial Report for Fiscal Year 2021

(2)

Consolidated Statement of Income and Consolidated Statement of Comprehensive Income

Consolidated Statement of Income(Million yen)
Current fiscal year
(from January 1, 2021
to December 31, 2021)

Previous fiscal year
(from January 1, 2020
to December 31, 2020)
Net sales

78,44580,177

Cost of sales

60,13061,170Gross profit

18,31419,007

Selling, general and administrative expenses

15,03914,862

Operating profit

3,275

4,144

Interest income

100

108

Dividend income

114

114

Rent income

54

53

Foreign exchange gains

50

0

Other

56

42

Total non-operating income

376

320

Interest expenses

1

1

Cost of lease revenue

99Non-operating income

Non-operating expenses

Sales discounts

44Compensation for damages

11

17

Other

17

10

Total non-operating expenses

45

42

3,606

4,422

Gain on sales of investment securities

36

18

Gain on sales of non-current assets

25

5

Total extraordinary income

62

24

Loss on sales on non-current assets

3-

Loss on retirement of non-current assets

41

92

Loss on valuation of investments securities

55-

Loss on sales of investment securities-

31

Impairment loss-

108

Ordinary profit
Extraordinary income

Extraordinary losses

Total extraordinary losses

101

232

Profit before income taxes

3,566

4,214

Income taxes-current

1,005

1,408

Income taxes-deferred

172

(7)

Total income taxes

1,177

1,401

Profit

2,389

2,813

(3)

(11)

2,392

2,824

Profit (loss) attributable to non-controlling interests
Profit attributable to owners of parent-7-

The Pack Corporation (3950) Financial Report for Fiscal Year 2021

Consolidated Statement of Comprehensive Income(Million yen)
Current fiscal year
(from January 1, 2021
to December 31, 2021)

Previous fiscal year
(from January 1, 2020
to December 31, 2020)
Profit

2,389

2,813

(474)

224

Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges(0)0Foreign currency translation adjustment

(26)

213

Remeasurements of defined benefit plans, net of tax

480

72

Total other comprehensive income

(21)

511

2,368

3,325

2,371

3,334

(3)

(9)

Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests-8-

The Pack Corporation (3950) Financial Report for Fiscal Year 2021

(3)

Consolidated Statement of Changes in Equity

Previous fiscal year (from January 1, 2020 to December 31, 2020)(Million yen)

Shareholders’ equity
Capital stock
Balance at beginning of current
periodChanges in items during period
Dividends of surplus
Profit attributable to ownersof parent
Purchase of treasury shares
Disposal of treasury shares
Additional purchase of sharesof subsidiaries
Net changes in items otherthan shareholders’ equity
Total changes in items during
periodBalance at end of current period

Capital surplus

2,553

54,607

Total shareholders’equityTreasury shares(2,765)57,560(1,138)(1,138)

2,392

2,392
47

(0)

47
(0)
-

-

(0)

1,253

47

1,301

2,553

3,164

55,860(2,717)58,861

Accumulated other comprehensive income
Foreign currency
Remeasurements oftranslation
defined benefit plansadjustment

Total accumulated
other comprehensive
incomeDeferred gains orlosses on hedges

1,462

0

(283)

(367)

811
-

(474)

(0)

(26)

480

(20)

(474)

(0)

(26)

480

(20)

987

0

(310)

112

790

Share acquisitionrightsBalance at beginning of current
periodChanges in items during period
Dividends of surplus
Profit attributable to ownersof parent
Purchase of treasury shares
Disposal of treasury shares
Additional purchase of sharesof subsidiaries
Net changes in items otherthan shareholders’ equity
Total changes in items during
periodBalance at end of current period

3,164

(0)

Valuation difference
on available-for-salesecurities
Balance at beginning of current
periodChanges in items during period
Dividends of surplus
Profit attributable to ownersof parent
Purchase of treasury shares
Disposal of treasury shares
Additional purchase of sharesof subsidiaries
Net changes in items otherthan shareholders’ equity
Total changes in items during
periodBalance at end of current period

Retained earnings

93

Non-controllinginterests

Total net assets
29

58,495(1,138)
2,392
47
(0)

(28)

(7)

(56)

(28)

(7)

1,244

65

22

59,739-9-The Pack Corporation (3950) Financial Report for Fiscal Year 2021

Current fiscal year (from January 1, 2021 to December 31, 2021)(Million yen)

Shareholders' equity
Capital stock
Balance at beginning of current
periodChanges in items during period
Dividends of surplus
Profit attributable to ownersof parent
Purchase of treasury shares
Disposal of treasury shares
Additional purchase of sharesof subsidiaries
Net changes in items otherthan shareholders’ equity
Total changes in items during
periodBalance at end of current period

Balance at beginning of current
periodChanges in items during period
Dividends of surplus
Profit attributable to ownersof parent
Purchase of treasury shares
Disposal of treasury shares
Additional purchase of sharesof subsidiaries
Net changes in items otherthan shareholders’ equity
Total changes in items during
periodBalance at end of current period

Balance at beginning of current
periodChanges in items during period
Dividends of surplus
Profit attributable to ownersof parent
Purchase of treasury shares
Disposal of treasury shares
Additional purchase ofshares of subsidiaries
Net changes in items otherthan shareholders’ equity
Total changes in items during
periodBalance at end of current period

Capital surplus

2,553

Retained earnings

3,164

55,860Total shareholders’equityTreasury shares(2,717)58,861(1,044)(1,044)

2,824

2,824
(0)
13

0

(0)
13
-

2,553

Valuation difference
on available-for-salesecurities

0

1,780

13

1,793

3,164

57,640(2,704)60,654

Accumulated other comprehensive income
Foreign currency
Deferred gains orRemeasurements oftranslation
losses on hedges
defined benefit plansadjustment

Total accumulated
other comprehensive
income

987

0

(310)

112

790
-

224

0

212

72

510

224

0

212

72

510

1,212

0

(98)

185

1,300

Share acquisitionrights65

Non-controllinginterests

Total net assets
22

59,739(1,044)
2,824
(0)
13
-

(1)

(9)

499

(1)

(9)

2,292

63

13

62,032- 10 -

The Pack Corporation (3950) Financial Report for Fiscal Year 2021

(4)

Consolidated Statement of Cash Flows(Million yen)Previous fiscal year
(from January 1, 2020
to December 31, 2020)

Cash flows from operating activities
Profit before income taxes
Depreciation
Impairment loss
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for bonuses for directors andother officers
Increase (decrease) in retirement benefit liability
Interest and dividend income
Interest expenses
Loss (gain) on sales of non-current assets
Loss on retirement of non-current assets
Loss (gain) on sales of investment securities
Loss (gain) on valuation of investment securities
Decrease (increase) in notes and accounts receivable-trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable-trade
Other, net
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of securities
Proceeds from sales of securities
Purchase of property, plant, and equipment
Proceeds from sales of property, plant, and equipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from sales of investment securities
Payments for leasehold and guarantee deposits
Other, net
Net cash provided by (used in) investment activities
Cash flows from financing activities
Proceeds from long-term loans payable
Repayments of long-term loans payable
Cash dividends paid
Payments from change in ownership interests in subsidiaries that
do not result in change in scope of consolidation
Other, net
Net cash provided by (used in) 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 -

Current fiscal year
(from January 1, 2021
to December 31, 2021)

3,566
1,850
3
(52)

4,214
2,029
108
(5)
36

(24)

13

(199)
(215)
1
(21)
41
(36)
55
3,977
940
(4,258)
(733)
4,895
229
(1)
(1,969)
3,155

(220)
(223)
1
(5)
92
12
(178)
152
1,173
301
7,503
217
(1)
(502)
7,217

(8,099)6,999(2,939)147(59)(1,029)47(179)
99(5,013)(9,505)
9,607(3,219)
8
(514)
(136)
135
(21)
186
(3,460)(48)(1,136)100(45)(1,045)

(4)

-

(25)
(1,214)(9)(3,083)18,307
15,224(38)(1,029)115
2,843
15,22418,067

The Pack Corporation (3950) Financial Report for Fiscal Year 2021

(5)

Notes to Consolidated Financial Statements

Going Concern Assumption
Not applicable
Segment and Other Information
1. Segment overview
The reportable segments of The Pack Group are the smallest units for which separate financial information can beobtained and for which regular examinations are performed by the Board of Directors to determine resource allocationand evaluate operational results.
The Group is engaged primarily in the manufacture and sale of paper bags, folding paper cartons, corrugated boxes, andplastic bags.
Based on the nature of the products, there are two reportable segments: Paper Products and Film Packaging.
The Group’s major products are paper bags, folding paper cartons, corrugated boxes, and printing in the Paper Products
segment and plastic bags and garment bags in the Film Packaging segment.
2. Method to determine net sales, profit or loss, assets, liabilities and other items by reportable segment
Accounting methods used for the reportable segments are generally the same as the methods used for preparation of theconsolidated financial statements.
Profit for reportable segments is stated on an operating profit basis.
3. Information concerning net sales, profit or loss, assets, liabilities and other items by reportable segment
Previous fiscal year (from January 1, 2020 to December 31, 2020)(Million yen)

Reportable segment
Paper
Products

Film
Packaging

Subtotal

Otherbusinesses(Note 1)

Total

Adjustment(Note 2)

Amountposted in the
consolidated
financialstatements(Note 3)

Net sales
Sales to external
51,386
13,48464,87013,57478,44578,445
customers
Intersegment sales andtransfers
Total
51,386
13,48464,87013,57478,44578,445
Segment profit
3,124
511
3,635
748
4,384
(1,109)3,275
Segment assets
40,835
7,965
48,8006,750
55,551
28,00583,556
Other items
Deprecation
1,462
331
1,794
47
1,841
8
1,850
Increases in property,
plant and equipment
3,297
392
3,690
57
3,748
3,748
and intangible assets
Notes:
1. “Other businesses” includes supplies and other goods.
2. The adjustments are as follows:(1) The -1,109 million yen adjustment to segment profit includes the elimination of intersegment transactions of 12 million yen notallocated to reportable segments and corporate expenses of -1,121 million yen. Corporate expenses primarily involve theparent company’s Administrative Department.
(2) The 28,005 million yen adjustment to segment assets represents corporate assets not allocated to reportable segments.
Corporate assets mainly include the parent company’s surplus assets under management (cash and deposits of 9,621 million
yen and securities of 9,099 million yen), long-term investments (investment securities of 8,722 million yen), and the parent
company’s land of 561 million yen.
(3) Adjustments to depreciation are related to the parent company’s head office assets.
3. Segment profit is adjusted for consistency with the operating profit stated in the consolidated statement of income.

- 12 -

The Pack Corporation (3950) Financial Report for Fiscal Year 2021

Current fiscal year (from January 1, 2021 to December 31, 2021)(Million yen)

Reportable segment
Paper
Products

Film
Packaging

Subtotal

Otherbusinesses(Note 1)

Total

Adjustment(Note 2)

Amountposted in the
consolidated
financialstatements(Note 3)

Net sales
Sales to external
55,511
11,184
66,696
13,48180,17780,177
customers
Intersegment sales andtransfers
Total
55,511
11,184
66,696
13,48180,17780,177
Segment profit
3,958
397
4,355
882
5,238
(1,093)4,144
Segment assets
42,674
6,964
49,642
7,088
56,72730,69587,422Other items
Deprecation
1,657
305
1,963
59
2,022
7
2,029
Increases in property,
plant and equipment
2,058
370
2,428
167
2,596
45
2,641
and intangible assets
Notes:
1. “Other businesses” includes supplies and other goods.
2. The adjustments are as follows:(1) The -1,093 million yen adjustment to segment profit includes the elimination of intersegment transactions of 12 million yen notallocated to reportable segments and corporate expenses of -1,105 million yen. Corporate expenses primarily involve theparent company’s Administrative Department.
(2) The 30,695 million yen adjustment to segment assets represents corporate assets not allocated to reportable segments.
Corporate assets mainly include the parent company’s surplus assets under management (cash and deposits of 11,040 million
yen and securities of 12,006 million yen), long-term investments (investment securities of 7,045 million yen), and the parent
company’s land of 603 million yen.
(3) Adjustments to depreciation and increases in property, plant and equipment and intangible assets are related to the parent
company’s head office assets.
3. Segment profit is adjusted for consistency with the operating profit stated in the consolidated statement of income.

- 13 -

The Pack Corporation (3950) Financial Report for Fiscal Year 2021

[Related information]
Previous fiscal year (from January 1, 2020 to December 31, 2020)
1.

Product- and service-specific information
This is omitted here because similar information is provided under segment information.

2.

Region-specific information(1)

Net sales
This is omitted here because sales to external customers in Japan account for more than 90% of net sales on the
consolidated statement of income.

(2)

Property, plant, and equipment
This is omitted here because the amount for property, plant, and equipment located in Japan accounts for morethan 90% of the amount for property, plant, and equipment on the consolidated balance sheet.

3.

Information specific to major customers
This is omitted here because no single external customer sales to whom account for 10% or more of net sales on the
consolidated statement of income exists.

Current fiscal year (from January 1, 2021 to December 31, 2021)
1.

Product- and service-specific information
This is omitted here because similar information is provided under segment information.

2.

Region-specific information(1)

Net sales

This is omitted here because sales to external customers in Japan account for more than 90% of net sales on the
consolidated statement of income.
(2)

Property, plant, and equipment

This is omitted here because the amount for property, plant, and equipment located in Japan accounts for more than
90% of the amount for property, plant, and equipment on the consolidated balance sheet.
3.

Information specific to major customers
This is omitted here because no single external customer sales to whom account for 10% or more of net sales on the
consolidated statement of income exists.

[Information on impairment loss on fixed assets by reportable segment]
Previous fiscal year (from January 1, 2020 to December 31, 2020)
Not applicable
Current fiscal year (from January 1, 2021 to December 31, 2021)

Paper Products

Reportable segment
Film Packaging(Million yen)
Other businesses(Note)

Subtotal

Impairment
108
loss(Note) Indicates impairment loss related to assets for business use.

108-

[Information on amortization of goodwill and unamortized balances by reportable segment]
Not applicable[Information on gain on negative goodwill by reportable segment]
Not applicable- 14 -

Companywide/
elimination

Total
-

108

The Pack Corporation (3950) Financial Report for Fiscal Year 2021

Per Share Information(Yen)
Previous fiscal year
(from January 1, 2020
to December 31, 2020)
3,141.09
126.01125.85

Net assets per share
Basic earnings per share
Diluted earnings per share(Notes)Current fiscal year
(from January 1, 2021
to December 31, 2021)
3,261.64
148.71148.53

1. The basic assumptions for calculating basic earnings per share and diluted earnings per share are as follows:
Previous fiscal year
(from January 1, 2020
to December 31, 2020)

Basic earnings per share
Profit attributable to owners of parent (million yen)Amounts not available to common shareholders (million yen)
Profit attributable to owners of parent related to common shares(million yen)
Average number of shares outstanding during the period(thousand shares)
Diluted earnings per share
Adjustment to profit attributable to owners of parent(million yen)
Increase in number of common shares (thousand shares)(of which share acquisition rights (thousand shares))
Antidilutive securities excluded from diluted earnings per sharecalculations

Current fiscal year
(from January 1, 2021
to December 31, 2021)

2,392
-

2,824
-

2,392

2,824

18,98618,993

-

-

24
(24)

22
(22)
-

2. The basic assumptions for calculating net assets per share are as follows:
Item
Total net assets (million yen)
Deduction on total net assets (million yen)(of which share acquisition rights) (million yen)(of which non-controlling interests) (million yen)
Net assets applicable to common shares (million yen)
Number of common shares used in calculation of net assets per
share (thousand shares)

Material Subsequent Events
Not applicable- 15 -

Previous fiscal year
(from January 1, 2020
to December 31, 2020)
59,73987(65)(22)
59,651

Current fiscal year
(from January 1, 2021
to December 31, 2021)
62,03277(63)(13)
61,95518,99018,995