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Consolidated Financial Results for the First Nine Months of
the Fiscal Year Ending March 31, 2021
<under Japanese GAAP>
February 1, 2021
ORGANO CORPORATIONTokyo Stock Exchange
6368
https://www.organo.co.jp/english/
Masaki Uchikura, Representative Director and President
Minoru Ando, General Manager of Accounting Dept., Corporate Management andPlanning
TEL:+81-3-5635-5111
Scheduled date to file quarterly securities report:
February 10, 2021
Scheduled date to commence dividend payments:–
Preparation of supplementary material on quarterly financial results: None
Holding of quarterly financial results presentation meeting:
None

Company name:
Listing:
Securities code:
URL:
Representative:
Inquiries:(Millions of yen with fractional amounts discarded, unless otherwise noted)

1. Consolidated financial results for the first nine months of the fiscal year ending March 31, 2021
(from April 1, 2020 to December 31, 2020)(1) Consolidated operating results (cumulative)
Net sales(Percentages indicate year-on-year changes.)

Operating profit

Millions of yen% Millions of yen%
Nine months ended
December 31, 2020
68,7362.1
5,261(29.6)
December 31, 2019
67,352
9.5
7,475
160.2
Note:
Comprehensive income: Nine months ended December 31, 2020
Nine months ended December 31, 2019

Basic earnings
per share
Nine months ended
December 31, 2020
December 31, 2019

Profit attributable toowners of parent

Ordinary profit
Millions of yen%

Millions of yen

5,421(26.9)
7,419
155.3¥3,626 million [(27.9)%]¥5,029 million [208.8%]

3,584
5,151

%

(30.4)
198.9

Diluted earnings
per shareYen

312.52450.41

Yen––(2) Consolidated financial position
Total assets
Millions of yen
As ofDecember 31, 2020
108,616
March 31, 2020
101,448(Reference) Equity: As of December 31, 2020
¥63,205 million

Net assets

Equity-to-asset ratio

Millions of yen

63,33560,857
As of March 31, 2020

%

58.2
59.9
¥60,717 million

2. Cash dividends
Annual dividends per shareFirst quarter-end Second quarter-end Third quarter-end
Yen

Fiscal year ended
March 31, 2020
Fiscal year ending
March 31, 2021

Yen

Fiscal year-end

Yen

–

47.00

–

–

52.00

–

Total

Yen

Fiscal year ending
March 31, 2021
(Forecast)
Note: Revisions to the forecast of cash dividends most recently announced: None

Yen

57.00

104.0052.00

104.003. Consolidated earnings forecasts for the fiscal year ending March 31, 2021
(from April 1, 2020 to March 31, 2021)(Percentages indicate year-on-year changes.)
Net sales
Millionsof yenOperating profit%

Millionsof yenProfit attributable toowners of parent

Ordinary profit%

Millionsof yenFiscal year ending
100,000
3.6
7,200(27.3)
7,100
March 31, 2021
Note:
Revisions to the earnings forecasts most recently announced: None%

(28.5)

Millionsof yen

4,700

Basic
earnings
per share%Yen(34.4)

409.83

Any impact amount factored in for the impact arising due to the proliferation of novel coronavirus disease (COVID-19) islimited to the amount that can be assumed at this stage. We will accordingly revise our earnings outlook as developments
unfold. Please refer to “(3) Explanation regarding consolidated earnings forecasts and other forward-looking statements” in“1. Qualitative information regarding financial results for the first nine months” on page 3 of the attached material for the
suppositions that form the assumptions for earnings forecasts and cautions concerning the use thereof.

* Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in thechange in scope of consolidation): None
(2) Application of specific accounting for preparing the quarterly consolidated financial statements: Yes
Note:

For more details, please refer to “Application of special accounting for preparing the quarterly consolidated
financial statements” on page 8 of the attached material.

(3) Changes in accounting policies, changes in accounting estimates, and restatementa. Changes in accounting policies due to revisions to accounting standards and other regulations: Noneb. Changes in accounting policies due to other reasons: Nonec. Changes in accounting estimates: None
d. Restatement: None
(4) Number of issued shares (common shares)
a. Total number of issued shares at the end of the period (including treasury shares)
As of December 31, 2020

11,589,925 shares

As of March 31, 2020

11,589,925 sharesb. Number of treasury shares at the end of the period
As of December 31, 2020

102,866 shares

As of March 31, 2020

136,593 sharesc. Average number of shares outstanding during the period (cumulative from the beginning of the fiscal
year)
For the nine months ended December 31, 2020

11,468,057 shares

For the nine months ended December 31, 201911,436,336 shares

The Company has introduced an Officer Share Delivery Trust, and shares of the Company held by the Trust havebeen included in treasury shares excluded from the calculation of the number of treasury shares at the end of theperiod and the average number of shares outstanding during the period (cumulative from the beginning of the fiscal
year).

* Quarterly financial results reports are exempt from quarterly review conducted by certified public
accountants or an audit corporation.
* Proper use of earnings forecasts, and other special matters
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.
Consequently, any statements herein do not constitute assurances regarding actual results by theCompany. Actual business and other results may differ substantially due to various factors. Please referto “(3) Explanation regarding consolidated earnings forecasts and other forward-looking statements” in“1. Qualitative information regarding financial results for the first nine months” on page 3 of theattached material for the suppositions that form the assumptions for earnings forecasts and cautions
concerning the use thereof.

Attached Material

Index
1. Qualitative information regarding financial results for the first nine months .........................................2(1) Explanation regarding operating results ................................................................................................2(2) Explanation regarding financial position ...............................................................................................3(3) Explanation regarding consolidated earnings forecasts and other forward-looking statements ......3
2. Quarterly consolidated financial statements and significant notes thereto ..............................................4(1) Consolidated balance sheet ......................................................................................................................4(2) Consolidated statement of income and consolidated statement of comprehensive income................6
Consolidated statement of income (cumulative) ....................................................................................6
Consolidated statement of comprehensive income (cumulative) ..........................................................7(3) Notes to quarterly consolidated financial statements ............................................................................8
Notes on premise of going concern ..........................................................................................................8
Notes on substantial changes in the amount of shareholders’ equity ...................................................8Application of special accounting for preparing the quarterly consolidated financial statements ...8
Additional information ............................................................................................................................8
Segment information, etc. ........................................................................................................................9-1-

1. Qualitative information regarding financial results for the first nine months(1) Explanation regarding operating results
During the nine months ended December 31, 2020 (from April 1, 2020 to December 31, 2020),
following the global spread of COVID-19, the Japanese and global economies have been in a state ofsignificant turmoil. Looking at the main markets in which the Organo Group operates, semiconductor
demand is rising in the electronics field mainly due to the expanding use of teleworking and the fullscale adoption of 5G telecommunications, and while we saw effects from intensifying friction oversemiconductors between the United States and China, we maintained high-level production andinvestment in Japan and overseas. In the general industrial field, there is a continuing trend to curb anddelay capital investment, we saw a decline in production levels among some of our customers, which inturn affected sales of performance products such as water treatment chemicals, filters, and foodprocessing materials. The electric power/water supply and sewage fields maintained around the samelevels as the previous year, no major impacts were observed.
Under these conditions, the Group was affected in the areas of new business development, newcustomer acquisition, and strengthening our overseas systems by restrictions on domestic and overseas
mobility and refraining from unnecessary outings. However, we promoted the shift to digital in ourengineering and solutions services as well as supervision by introducing various communication tools
and engineering tools using ICT technology and balanced preventing the spread of COVID-19 with ourbusiness activities. As a result, in the Group’s financial results for the nine months ended December 31,
2020, orders received decreased by 11.2% year on year to ¥72,075 million, net sales increased by 2.1%
year on year to ¥68,736 million, and our carry-over balance for order backlog as of December 31, 2020
was down 2.1% to ¥71,114 million. On the profit side, operating profit decreased by 29.6% to ¥5,261
million, ordinary profit decreased by 26.9% to ¥5,421 million, and profit attributable to owners of theparent decreased by 30.4% to ¥3,584 million.
Results by segment are as follows.
[Water Treatment Engineering Business Unit]
In the Water Treatment Engineering Business Unit, despite a decline in orders received in theelectronics field by the Plant Division compared to the previous fiscal year when there were large-scaleorders in Japan and overseas, steady progress in the construction of large projects for which orders
were received in the previous fiscal year as well as growth in the Service Solutions Division backed byhigh production levels led to strong net sales. Furthermore, overseas, in addition to continued largescale semiconductor investment centered on Taiwan and China, solution services including
maintenance trended strongly, and both orders received and net sales grew significantly. Meanwhile, inthe general industrial field, the continuing trend to curb and delay capital investment caused by
COVID-19 has led to a decline in orders received and net sales centered on the Plant Division both inJapan and overseas. The electric power/water supply and sewage fields were mostly unchanged fromthe previous fiscal year as large-scale orders were received for water supply and sewage projects andmaintenance work remained steady. Consequently, orders received decreased by 13.5% year on year to¥58,254 million and net sales increased by 3.3% year on year to ¥55,169 million.
Meanwhile, on the profit side, compared to the previous fiscal year, when there was concentration ofsales of comparatively profitable projects, mainly in the electronics field, and projects with prominent
cost reduction effects, the profit margin was lower. As a result, operating profit decreased by 32.4%
year on year to ¥4,364 million.
[Performance Products Business Unit]
In the Performance Products Business Unit, while we saw some recovery in the second half of the year,
investment and production are curbed in general. In particular, sales to general industries, such as
automotive and restaurant fields, which were heavily impacted by COVID-19, and sales to medical
institutions, such as the examinations and general care field, declined. On the other hand, sales werestrong for water treatments chemicals to the electronics industry, which has maintained high productionlevels, and for Orplus® slightly acidic electrolyzed water for disinfecting and deodorizing.
Consequently, orders received increased by 0.1% year on year to ¥13,821 million, net sales decreasedby 2.6% year on year to ¥13,567 million, and operating profit decreased by 11.8% to ¥897 million.
-2-(2) Explanation regarding financial position
Assets, liabilities and net assets
AssetsNet assets as of December 31, 2020 amounted to ¥108,616 million, an increase of ¥7,168 million fromthe previous fiscal year end. This was due mainly to an increase of ¥6,145 million in notes andaccounts receivable - trade and an increase of ¥4,871 million yen in inventories mainly in work inprocess, despite a decrease of ¥3,336 million in cash and deposits.
Liabilities
Liabilities as of December 31, 2020 amounted to ¥45,281 million, an increase of ¥4,690 million fromthe previous fiscal year end. This was due mainly to an increase of ¥6,439 million in short-termborrowings, despite a decline of ¥2,172 million in other current liabilities.
Net Assets
Net assets as of December 31, 2020 amounted to ¥63,335 million, an increase of ¥2,477 million fromthe previous fiscal year end. This was mainly due to an increase of ¥2,329 million in retained earnings
resulting from the recording of profit attributable to owners of parent.
(3) Explanation regarding consolidated earnings forecasts and other forward-looking statements
Turning to full-year earnings forecasts, there are concerns over the impact of COVID-19 as well as theimpacts of trade friction over semiconductors between the United States and China in the electronics
field, which has been trending favorably. However, at this stage, there has been no sign of significant
delays or cancellation of planned projects, and construction on accepted projects in Japan and overseas
is proceeding steadily. Therefore, the full-year earnings forecasts have been left unchanged from theprevious announcement. Any impact amount factored in is limited to the amount that can be assumed at
this stage. We will accordingly revise our earnings outlook as developments unfold.

-3-

2. Quarterly consolidated financial statements and significant notes thereto(1) Consolidated balance sheet(Millions of yen)
As of March 31, 2020

As of December 31, 2020

13,77236,783

10,43642,928

1,590

1,758

11,752
5,710
2,728
1,392
2,448
(98)
76,078

10,273
6,122
7,209
1,370
3,502
(107)
83,494

17,909(12,562)
5,347
5,697
(4,974)722
12,28498
5,088(4,245)842
19,296
1,113

17,751(12,730)
5,020
5,663
(5,026)637
12,277313
5,117(4,363)753
19,002
1,115

1,553
3,037
780
(411)
4,959
25,369101,448

1,708
2,956
745
(406)
5,004
25,122
108,616

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Electronically recorded monetary claims operating
Investments in leases
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Machinery, equipment and vehicles
Accumulated depreciation
Machinery, equipment and vehicles, net
LandConstruction in progress
Other
Accumulated depreciation
Other, net
Total property, plant and equipment
Intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets-4-

(Millions of yen)
As of March 31, 2020

As of December 31, 2020

14,381
–
7,644
1,959
1,543
1,339
324
64

12,4644,464
14,084
990
1,885
643
334
53

105

72

10
4,866
32,240–2,694
37,687

2,095
9
6,153
91
8,349
40,590

1,545
0
5,971
75
7,593
45,281

8,225
7,508
46,081(537)
61,2778,225
7,508
48,411(432)
63,712

143

198

(178)
(525)
(560)
140
60,857
101,448

(263)
(442)
(507)
130
63,335
108,616

Liabilities
Current liabilities
Notes and accounts payable - trade
Electronically recorded obligations - operating
Short-term borrowings
Income taxes payable
Advances received
Provision for bonuses
Provision for product warranties
Provision for loss on construction contracts
Provision for share-based remuneration for
directors (and other officers)
Other provisions
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Deferred tax liabilities
Retirement benefit liability
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets-5-(2) Consolidated statement of income and consolidated statement of comprehensive income
Consolidated statement of income (cumulative)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Insurance claim income
Share of profit of entities accounted for using
equity method
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Provision of allowance for doubtful accounts
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Gain on sales of right of using facilities
Total extraordinary income
Extraordinary losses
Loss on abandonment of non-current assets
Loss on valuation of investment securities
Loss on sales of right to use facilities
Loss on valuation of right to use facilities
Total extraordinary losses
Profit before income taxes
Income taxes
ProfitProfit (loss) attributable to non-controlling interests
Profit attributable to owners of parent

Nine months ended
December 31, 2019
(From April 1, 2019 to
December 31, 2019)
67,35247,49019,861
12,3867,475-6-(Millions of yen)
Nine months ended
December 31, 2020
(From April 1, 2020 to
December 31, 2020)
68,736
51,174
17,562
12,300
5,261

30
26
23

22
25
100

150

99

47
278

35
283

104
94
78
56
334
7,419

86
30
–
6
123
5,421

0
4
0
5

4
14
–
19

10
–
–
–
10
7,414
2,270
5,143
(7)
5,151

113
13
4
0
131
5,309
1,721
3,587
3
3,584

Consolidated statement of comprehensive income (cumulative)

ProfitOther comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net oftax
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

Nine months ended
December 31, 2019
(From April 1, 2019 to
December 31, 2019)
5,143

-7-

(Millions of yen)
Nine months ended
December 31, 2020
(From April 1, 2020 to
December 31, 2020)
3,587

18

55

0
(198)

–
(99)

65

82

1

(0)

(113)
5,029

38
3,626

5,037

3,637

(7)

(10)

(3) Notes to quarterly consolidated financial statements
Notes on premise of going concern
No items to report
Notes on substantial changes in the amount of shareholders’ equity
No items to report
Application of special accounting for preparing the quarterly consolidated financial statements
Calculation of tax expenses
Tax expenses are calculated by multiplying the profit before income taxes by the reasonably estimatedeffective tax rates after the application of tax effect accounting to the profit before income taxes for the
fiscal year including the third quarter ended December 31, 2020. However, in cases where thecalculation of tax expenses using such estimated effective tax rate yields a result that is not reasonable
to a significant extent, the amount of significant difference other than temporary differences, etc. isadded to or deducted from the profit before income taxes, and the result is multiplied by the statutory
income tax rate.
Additional information
Impact arising due to the proliferation of COVID-19
There has been no material change in the assumptions regarding the impact of COVID-19 described in
the annual securities report (Additional information) (Impact arising due to the proliferation of COVID19) for the previous fiscal year.

-8-Segment information, etc.
[Segment information]
I Nine months ended December 31, 2019 (from April 1, 2019 to December 31, 2019)
1. Information relating to net sales and profit by each reportable segment
Reportable Segment(Millions of yen)Amountrecorded in the
consolidated
statement ofincome(Note)

Water
Treatment
Engineering
Business Unit

Performance
Products
Business Unit

Net sales
Sales to external customers
Intersegment sales or transfers

53,4250

13,926249

67,352
250

–
(250)

67,352–

Total

53,426

14,176

67,602(250)

67,352

Total

Adjustment

Segment profit
6,458
1,017
7,475
–
7,475
Note:
The figures for segment profit are based on operating profit, and there are no discrepancies with the operating profit
shown in the consolidated statement of income.

II Nine months ended December 31, 2020 (from April 1, 2020 to December 31, 2020)
1. Information relating to net sales and profit by each reportable segment
Reportable Segment(Millions of yen)Amountrecorded in the
consolidated
statement ofincome(Note)

Water
Treatment
Engineering
Business Unit

Performance
Products
Business Unit

Net sales
Sales to external customers
Intersegment sales or transfers

55,1690

13,567247

68,736
248

–
(248)

68,736–

Total

55,16913,814

68,984(248)

68,736

Total

Adjustment

Segment profit
4,364
897
5,261
–
5,261
Note:
The figures for segment profit are based on operating profit, and there are no discrepancies with the operating profit
shown in the consolidated statement of income.

-9-