Summary of Financial Results
for the Fiscal Year Ended December 31, 2023
[Japanese Standards] (Consolidated)
February 15, 2024

Name of Listed Company: Pigeon Corporation (Stock code: 7956)
Listings: Prime Market, Tokyo Stock Exchange
Website: www.pigeon.com
Representative: Norimasa Kitazawa (President and CEO)Contact person: Nobuo Takubo (Managing Officer, Business Strategy Division Manager)/Tel: +81-3-3661-4204
Scheduled Date of Annual General Shareholders’ Meeting: March 28, 2024
Scheduled Commencement Date of Dividend Payments: March 28, 2024
Scheduled Filing Date of Annual Securities Report: March 29, 2024
Preparation of Any Additional Explanatory Materials for Financial Results: Yes
Holding of Any Briefing Session for Financial Results: Yes (For analysts and institutional investors)

1. Consolidated Business Performance for the Fiscal Year Ended December 31,
2023 (January 1 to December 31, 2023)(1) Consolidated Operating Results (cumulative)(Millions of yen, rounded down, % figures denote year-on-year change)
Net Income
Operating Income
Ordinary Income
Attributable to
Owners of Parent

Net Sales
Millions of Yen%

Millions of Yen%

Millions of Yen%

Millions of Yen%

FY ended December 31, 2023

94,461(0.5)

10,726(12.1)

11,522(14.4)

7,423(13.5)FY ended December 31, 2022

94,921

2.0

12,195(8.6)

13,465

(8.1)

8,581

(2.3)

(Note) Comprehensive income:FY ended December 31, 2023
FY ended December 31, 2022

¥10,540 million (13.4% negative)¥12,165 million (6.4% negative)

Net Income
per Share (¥)

Diluted Net Income
per Share (¥)

Return on
Equity (%)

Total Assets/
Ordinary Income (%)

FY ended December 31, 2023

62.06

－

9.6

11.4

11.4

FY ended December 31, 2022

71.72

－

11.4

13.5

12.8

(Reference) Equity in earnings of affiliates:

FY ended December 31, 2023
FY ended December 31, 2022¥－ million¥－ million(2) Consolidated Financial Position
Total Assets

OperatingMargin (%)

Net Assets

Equity Ratio (%)

Net Assets
per Share (¥)

FY ended December 31, 2023

100,440

81,08777.2

648.73

FY ended December 31, 2022

101,733

79,95275.4

640.96

FY ended December 31, 2023
FY ended December 31, 2022

¥77,581 million¥76,695 million(Reference) Shareholders’ Equity:(3) Cash Flows

Cash and Cash
Equivalents
at Year-End

Cash Flows fromOperating Activities

Cash Flows from
Investing Activities

Cash Flows from
Financing Activities

FY ended December 31, 2023

14,523(5,467)(10,256)

34,357

FY ended December 31, 2022

13,210(5,659)(9,666)34,283

2. Cash Dividends

Annual Dividend (¥)
1Q-end2Q-endFY ended December 31, 2022

－

38.00

FY ended December 31, 2023－

FY ending December 31, 2024
(Forecast)

－

Total
Dividends
Paid (fullyear) (¥ mil)Consolidated
Payout Ratio(%)

Dividends on
Consolidated
Net Assets(%)

3Q-end Year-end

Total

－

38.00

76.00

9,101

106.1

12.1

38.00

－

38.00

76.00

9,101

122.6

11.8

38.00

－

38.00

76.00

119.8

3. Consolidated Business Performance Forecasts for the Fiscal Year Ending
December 31, 2024 (January 1 to December 31, 2024)
Net Sales

Operating Income

Millions of Yen

Full year

101,000% Millions of Yen

6.9

11,400(% figures denote year-on-year change from the previous term)
Net Income
Net Income per
Ordinary Income
Attributable to
Share
Owners of Parent% Millions of Yen

6.3

11,400% Millions of Yen

(1.1)

7,600

%

2.4

Yen

63.54

Notes
(1) Changes in major subsidiaries (or changes in specific subsidiaries that affect the scope of consolidation) during theperiod under review: None
New: － (Company name: － ), Excluded: － (Company name: － )(2) Changes in accounting policies, changes in accounting-based estimates, and restatements
1) Changes in accounting policies associated with revision of accounting standards: None
2) Changes in accounting policies other than the above 1): None
3) Changes in accounting-based estimates: None
4) Restatements: None
(3) Number of outstanding shares (common stock)1) Number of shares outstanding at the period-end (including treasury stock)
FY ended December 31, 2023: 121,653,486 shares
FY ended December 31, 2022: 121,653,486 shares2) Amount of treasury stock at the period-end
FY ended December 31, 2023: 2,063,781 shares
FY ended December 31, 2022: 1,996,488 shares
3) Average number of shares outstanding during the period
FY ended December 31, 2023: 119,617,076 shares
FY ended December 31, 2022: 119,651,570 shares(Note) Amount of treasury stock at the period-end includes Company shares held by the board incentive plan (BIP) trust forcompensation of directors (169,948 shares as of FY ended December 31, 2023; 102,956 shares as of FY ended
December 31, 2022). Company shares held by the BIP trust for compensation of directors are also included in thetreasury stock subtracted in the calculation of the average number of shares outstanding during the period.

* This summary of financial results is exempt from audit by certified public accountants and auditing corporations.
* Cautionary Statement regarding Performance Forecasts
The forecasts and future projections stated in this report have been prepared on the basis of the information andassumption that shall be reasonable as of the date of announcement of this summary information, and the forecasts andfuture projections stated in this report are in no way intended as a promise of achievement as a company.
In addition, the actual results could differ significantly from forecast figures depending on a variety of factors. See thesection “(4) Future Directions” in “1. Overview of Management Results and Related Matters” on page 6 regarding
conditions which are preconditions for business performance forecasts and cautions for using the business performance
forecast.

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

Table of Contents of the Appendix
1. Overview of Management Results and Related Matters .................................................................. 2(1) Overview of Management Results for the Term Under Review ................................................. 2(2) Overview of Financial Position for the Term Under Review ..................................................... 5(3) Overview of Cash Flows for the Term Under Review ................................................................ 5(4) Future Directions ......................................................................................................................... 6(5) Income Appropriation Policy and Dividends for the Term Under Review and Next Term ....... 7
2. Basic Approach for the Selection of Accounting Standards ............................................................ 7
3. Consolidated Financial Statements and Main Notes........................................................................ 8(1) Consolidated Balance Sheets....................................................................................................... 8(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income ............ 10
Consolidated Statement of Income ............................................................................................ 10
Consolidated Statement of Comprehensive Income .................................................................. 11(3) Statement of Changes in Consolidated Shareholders’ Equity ................................................... 12(4) Consolidated Statements of Cash Flows ................................................................................... 14(5) Notes on Consolidated Financial Statements ............................................................................ 16(Notes Regarding Going Concern Assumptions)...................................................................... 16(Important Accounting Estimates) ............................................................................................ 16(Additional Information) ........................................................................................................... 17(Segment Information) .............................................................................................................. 18(Per Share Information) ............................................................................................................ 21(Material Subsequent Events) ................................................................................................... 211

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

1. Overview of Management Results and Related Matters(1) Overview of Management Results for the Term Under Review
1) Performance Overview
The Japanese economy staged a gradual recovery during the consolidated accounting year underreview. Restrictions on movement imposed in response to COVID-19 were eased, economic activity
moved toward normalization and inflows of foreign tourists rose, supporting a recovery in personal
consumption. In the global economy as well, a recovering trend was observed and is expected tocontinue. However, lingering uncertainty about the near-term outlook was fed by the effects of global
monetary tightening and rising prices, as well as conditions in the Middle East and fluctuations infinancial and capital markets.
Against this background, in February 2023 the Pigeon Group announced its Eighth Medium-TermBusiness Plan (covering the period from the fiscal year ended December 2023 through the fiscal
year ending December 2025). To respond flexibly to a business environment that continues tochange rapidly worldwide, thereby ensuring itself of sustainable growth, the Group is steadily
implementing three basic strategies (brand strategy, core product strategy and regional strategy).
Guided by these strategies, the Group will focus on pursuing sustainable growth in existing
business fields and on exploring and cultivating new growth fields where it can deploy its uniqueexpertise, thereby proactively rebuilding its operating structure. The consolidated accounting year
under review was the first year of the Medium-Term Business Plan. In addition to pursuingbusiness growth, the Group implemented a range of measures to achieve its purpose, which is “tomake the world more baby-friendly by furthering our commitment to understanding and addressing
babies' unique needs.”
In the consolidated accounting year under review, despite being led by strong results in the Japan
Business and Lansinoh Business, net sales decreased to ¥94,461 million (down 0.5% YOY) due tolower sales in the China Business and Singapore Business compared to the previous fiscal year. In
earnings, in addition to falling gross profit due to a decrease in revenue, the active use of sales
promotion expenses resulted in operating income decreasing to ¥10,726 million (down 12.1% YOY).
Ordinary income decreased to ¥11,522 million (down 14.4% YOY) and net income attributable toowners of parent fell to ¥7,423 million (down 13.5% YOY).
The main exchange rates used in the preparation of this consolidated period’s financial statements for
the Company’s overseas consolidated subsidiaries (revenues and expenses) are as follows:
・1 US$: 140.58 yen (131.55 yen)
・1 CNY: 19.83 yen (19.50 yen)
Note: Figures in parentheses represent the exchange rate in the previous fiscal year.
2) Segment Review
The Group has a total of four reporting segments: the Japan Business, China Business, Singapore
Business, and Lansinoh Business. An outline of each segment is given below.
Japan BusinessThis segment consists of businesses such as the Baby Care Business, Child Care Service Business,and Health & Elder Care Business. Net sales for the entire segment amounted to ¥36,865 million (up1.5% YOY), and segment profit was ¥2,006 million (up 34.5% YOY).
In the Baby Care Business (childcare and feminine products), net sales grew YOY, buoyed partly
by price revisions implemented in February and September on baby-related products such as
nursing bottles and nipples. Sales of core products such as nursing bottles, nipples and baby
skincare products, as well as of consumables such as baby wipes, were favorable, benefiting fromreinvigorated sales efforts. In August 2023, the Baby Care Business launched SHUPOT, an electricnose cleaner that quickly draws out mucus that can collect at the back of babies’ noses, and Bonyu
2

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

Jikkan Parts, a product series that enables mothers to repurpose the nursing bottles that are so filledwith memories. These products were extremely well-received by customers. Also, for our official
online shop, we are working to further invigorate sales by improving convenience throughstrengthened collaboration with online shopping malls, and by expanding our lineup of limitededition products. Furthermore, as part of our efforts for direct communication, we held online
events such as Breastfeeding seminars for mothers who are about to give birth, and a Pigeon
Seminar for medical professionals on the theme of “breastfeeding childcare as part of intimate
childrearing for mothers and children.” A total of more than approximately 2,000 people
participated in the seminars. For Pigeon Info, which is a website supporting women during
pregnancy, childbirth, and childcare, in addition to updating product information, we are continuing
to make improvements aimed at bringing even greater convenience to customers. For the generalpublic, we held online and offline exhibitions on “babies and families requiring specialized care” inan effort to raise awareness for this topic.
Pigeon Home Products Corporation, a Pigeon Group company that produces skincare and otherproducts, completed a plant in Fuji, Shizuoka Prefecture, transferring the operations of the former
No. 1 Plant and No. 2 Plant there. The new plant began full-scale operation in September 2023.
Aiming to create customer value through new skincare and other products, Pigeon Home Products
is strengthening its development framework, improving productivity and pouring efforts into
environmental measures.
In products for health and elder care, we implemented price revisions in February and September
for some products. Pigeon also continued to burnish its Habinurse elder-care brand. The brandlaunched products such as Liquid Thickener—Simply Add, a product that adjusts the viscosity offoodstuffs and can be used even in carbonated beverages. The Group is continuing its thoroughimplementation of measures such as further bolstering sales activities with respect to retail outlets,
elder-care facilities and other partners and improving the quality of elder-care services.
Regarding child care service, we currently provide services at 61 in-company child-care facilities,
and shall continue to develop this business further while striving to improve the quality of service
content.
China BusinessNet sales in this segment amounted to ¥33,045 million (down 5.0% YOY), and segment profit was¥8,858 million (down 14.9% YOY).
In Mainland China, particularly in the second half of the year, net sales in local currency terms were
down YOY due to the effects of deteriorating economic confidence, increased awareness for saving,
and a tendency to refrain from purchasing Japanese products due to the release of ALPS treated water
into the ocean. On the other hand, in addition to core baby products, we made concerted efforts toextend the utility of many products to older children, which Pigeon is working on as part of our efforts
to respond to the declining number of births and to expand our customer base. These efforts are
already producing a certain level of results, with strong sales including increased sales of the Shizen
Rinyu Series of nursing bottles for older babies, launched in June, 2023, and skincare products forchildren, rolled out at the end of 2022. In consumer communications, the Group took a number ofsteps to drive sustained business growth. The Group strengthened sales through Douyin, the mainland
China version of the short-video platform TikTok, and made active use of digital marketing tools
such as social media and live broadcasts. The Group also reinforced sales promotions at bricks-andmortar stores and activities at hospitals and maternity clinics.
In South Korea, where Group operations are managed through this segment, the Pigeon Groupbegan reorganizing its distribution framework in the consolidated fiscal year under review. Using
local sales subsidiaries as its base, the Group is strengthening sales and marketing efforts in South
Korea, seeking to attract new customers and reinforce relationships with existing customers.
Finally, the Group continued to strengthen efforts to boost sales of baby products under the Pigeon
brand in the North American market.
3

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

Singapore BusinessIn this segment, net sales amounted to ¥13,085 million (down 7.5% YOY), and segment profit was¥1,235 million (down 42.3% YOY).
This segment is responsible for operations in the ASEAN region and India. Net sales declined YOY
amid a rebound from the rising demand from the rapid recovery of the previous year, along with
continued shipping adjustments, as COVID-19-related restrictions were lifted in major markets. In
the core product categories that this business is focusing on, the Group introduced new nursing
bottles, which have been sold earlier in the Chinese and Japanese markets, and then expanded thesales area. The Group also worked to further expand the product lineup and to strengthen sales anddistribution with a focus on nursing bottles made with T-Ester*, a new plastic as transparent as
glass, and on the Natural Botanical Baby skin-care series, produced with natural ingredients to be
gentle on babies’ skin and friendly to the environment. We continue to advance the development
and launch of products that meet the needs of each market for the upper-middle class and higher
income brackets; for example, we renewed manual and electric breast pumps and launched products
tailored to market characteristics. With the aim of achieving market penetration and strengthening
Group brands, we will implement proactive sales and marketing activities, including improving instore appeal, strengthening social media response, and expanding communication with hospitals andmaternity clinics.
*T-Ester is a trademark or registered trademark of Mitsubishi Gas Chemical Company, Inc. inJapan and other countries.
Lansinoh BusinessIn this segment, net sales amounted to ¥18,480 million (up 9.2% YOY), and segment profit was¥1,453 million (up 25.9% YOY).
North America and Europe, two vital markets for the segment, saw some calming in the disruption
which had continued in marine logistics. Even so, there was still impact from persistently highlogistics costs related to land transportation, especially in North America. In North America, net sales
fell YOY in local-currency terms, as market competition for consumables such as breast pads
intensified and special demand for our products ran its course, following the end of a shortage of
powdered-milk supplies in the United States that had occurred intermittently since 2022. Meanwhile,
sales were strong in Europe, notably in Germany and United Kingdom, paced by nipple care creams,
a core product line. As a result, net sales for the entire segment were up YOY. Due to the effects ofactive sales promotion and investments, net sales in both Europe and North America were favorable
for prenatal and postnatal care products, a new category. In this segment, the Group will work toachieve further business growth by expanding its mainstay line of products to support breastfeedingand expand products in new categories, while striving to bolster its e-commerce presence and brand.

4Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

(2) Overview of Financial Position for the Term Under Review(Assets)
As of December 31, 2023, total assets amounted to ¥100,440 million, down ¥1,293 million from theprevious consolidated fiscal year ended December 31, 2022. Current assets had a decrease of ¥2,343
million, and fixed assets had an increase of ¥1,049 million.
Current assets decreased mainly due to decreases in notes and accounts receivable - trade of ¥1,562
million and in merchandise and finished goods of ¥953 million, despite an increase in receivables of¥804 million.
Fixed assets increased mainly due to a ¥3,637 million increase in buildings and structures and a¥1,385 million increase in machinery, equipment and vehicles, both included in tangible fixed assets,
despite a ¥3,453 million decrease in construction in progress included in tangible fixed assets.
(Liabilities)
As of December 31, 2023, total liabilities amounted to ¥19,352 million, down ¥2,428 million fromthe previous consolidated fiscal year ended December 31, 2022. Current liabilities had a decrease of¥2,030 million, and fixed liabilities had a decrease of ¥397 million.
Current liabilities decreased mainly due to decreases in notes and accounts payable - trade of ¥1,423
million and in income taxes payable of ¥493 million.
Fixed liabilities decreased mainly due to decreases in lease liabilities of ¥232 million and in otherfixed liabilities of ¥156 million.
(Net Assets)
As of December 31, 2023, total net assets amounted to ¥81,087 million, up ¥1,134 million from theprevious consolidated fiscal year ended December 31, 2022.
This increase resulted mainly from an increase in foreign currency translation adjustment of ¥2,709
million, despite a decrease in retained earnings of ¥1,728 million.
(3) Overview of Cash Flows for the Term Under Review
As of December 31, 2023, cash and cash equivalents (hereinafter referred to as “net cash”)
amounted to ¥34,357 million, up ¥74 million compared with the end of the previous fiscal year.
Cash Flows from Operating Activities
Net cash provided by operating activities amounted to ¥14,523 million, up from ¥13,210 million of
the previous fiscal year. Factors increasing operating cash flows included ¥11,154 million in income
before income taxes, ¥4,881 million in depreciation, and a ¥2,544 million decrease in inventories.
Contrasting factors included ¥4,364 million in income taxes paid and a ¥2,073 million decrease innotes and accounts payable - trade.
Cash Flows from Investing Activities
Net cash used in investing activities totaled ¥5,467 million, down from ¥5,659 million of the previous
fiscal year. This is mainly due to ¥5,484 million in purchase of tangible fixed assets.
Cash Flows from Financing Activities
Net cash used in financing activities was ¥10,256 million, up from ¥9,666 million of the previous
fiscal year. This is mainly due to ¥9,109 million in payment of cash dividends.

5Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

Cash flow indicators of the Group are shown below.

FY ended December 31,
2021

FY ended December 31,
2022

FY ended December 31,
2023

Equity Ratio (%)

75.4

75.4

77.2

Equity Ratio based on Market Price (%)

268.2

255.0

193.4

Debt Repayment Term (years)

0.2

0.2

0.2

Interest Coverage Ratio (times)

137.1

137.6

144.1

- Equity ratio: Total shareholders’ equity ÷ Total assets- Equity ratio based on market price: Market value of total stock ÷ Total assets- Debt repayment term: Interest-bearing debt ÷ Operating cash flows- Interest coverage ratio: Operating cash flows ÷ Interest paid
Notes:
1. Each index is calculated based on consolidated financial figures.
2. Market value of total stock is calculated by multiplying the stock price (closing price at the end of the term) by the number of shares outstandingat the end of the term (after deduction of treasury stock).
3. Operating cash flow figures are taken from the Cash Flows from Operating Activities section of the Consolidated Statements of Cash Flows.
4. Interest-bearing debt refers to all debt that incurs interest (listed in Consolidated Balance Sheets).
5. For interest paid, interest expenses (listed in Consolidated Statements of Cash Flows) are used.

(4) Future Directions
The Group has prepared its Eighth Medium-Term Business Plan, whose first year is the fiscal year
ended December 2023 (covering the period from the fiscal year ended December 2023 to the fiscal
year ending December 2025). The theme of this Medium-Term Business Plan is “For Sustainable
Growth: Restructuring of business in response to global economic, political, and environmental
changes.” In this Medium-Term Business Plan, the Group will diligently implement the three basic
strategies outlined below, with a view to responding flexibly to a business environment that is
rapidly changing worldwide and ensuring sustainable growth going forward. While pursuingsustainable growth in existing business fields, the Group will also focus on discovering andnurturing new growth domains in which it can leverage its expertise, thereby proactively
reconfiguring its business structure.
1. Brand Strategy
Our brand strategy is centered on its Purpose for our business activities and strengthening brandpower through products.
2. Product Strategy
The Group will strengthen Monozukuri, focus on core categories (nursing bottles and skincare), andexplore new areas.
3. Regional Strategy
Strengthening autonomous business operation by each SBU, the Group will implement far-reaching
structural reform to establish production and sales systems tailored to market characteristics,
improve efficiency and profitability, stabilize the supply chain and prepare for expansion into newmarkets.
In existing businesses, the Group will leverage its preeminence and competitive strength in its coreproducts of nursing bottles, nipples and products in the baby skin care category. To strengthen theseadvantages further, the Group will offer lifestyle product and service proposals, examine newmaterials and respond to environmental and local needs, thereby enhancing its product and service
lineup for social changes in the post-COVID-19 world. At the same time, the Group will aim forsustainable growth by radically revising its sales strategies for various products in each businessand making structural changes such as supply-chain improvements.
The Group is actively considering and executing entry into other fields that the Group has not yet
entered but where it can expect to apply its superior capabilities. These include an “age-up” strategy
of developing children’s products aimed at a broader range of target customers; creating and6

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

nurturing new categories of women’s care products, where the Group enjoys strong customer
affinity; and extending into new markets, such as Africa. In this way the Group will explore andcultivate new domains to produce growth for the next generation.
In addition, the Group will further strengthen its Group-wide head-office functions at Global Head
Office (GHO), clarify the roles and responsibilities of its four segments (Japan Business, China
Business, Singapore Business and Lansinoh Business), which are responsible for business
management and growth in each region, and improve communication with GHO. These efforts are
expected to propel each segment onto a stable, long-term growth arc and reinforce corporate
governance and other aspects of the management base.
For the fiscal year ending December 31, 2024, which is the second year of the 8th Medium-TermBusiness Plan, when considering the state of affairs in the consolidated accounting period underreview, the Group forecasts net sales of ¥101,000 million (up 6.9% YOY), operating income of¥11,400 million (up 6.3% YOY), ordinary income of ¥11,400 million (down 1.1% YOY) and net
income of ¥7,600 million (up 2.4% YOY).
(5) Income Appropriation Policy and Dividends for the Term Under Review and Next Term
The Pigeon Group regards the return of income to shareholders as an important management priority.
Our basic policy is to return income actively to shareholders through appropriation of retained
earnings and other means, while reinforcing our financial position based on considerations of
medium-term changes in business conditions and the Group’s business strategies. Internal reserves
are put to effective use to ensure the future profitability of the Group. Applications for internal
reserves include not only strengthening the Group’s financial position but also investing in R&D andnew business fields for further growth and investing in production facilities to strengthen thecorporate brand, raise production capacity, reduce costs, enhance product quality and grow throughstrategies such as mergers and acquisitions.
With respect to targets of shareholder return, under the Eighth Medium-Term Business Plan (for theperiod between the fiscal year ended December 2023 and the fiscal year ending December 2025)
announced in February 2023, we aim for further improvement of consolidated business results andfinancial position, along with continuous, stable dividend supporting existing dividend levels.
Based on the aforementioned policy and targets, the Group distributed an interim dividend for theterm under review of ¥38 per share (ordinary dividend of ¥38). For the year-end dividend, theGroup forecasts a dividend of ¥38 per share (ordinary dividend of ¥38). As a result, the annual
dividend for the term under review will total ¥76 per share (ordinary dividend of ¥76), which is thesame level as the previous fiscal year.
As in the fiscal year under review, the annual dividend for the next fiscal year is expected to total¥76 per share. This dividend is based on the targets of shareholder return set out under the Eighth
Medium-Term Business Plan: further improvement of consolidated business results and financial
position, along with continuous, stable dividend supporting existing dividend levels.
2. Basic Approach for the Selection of Accounting Standards
For the time being, our Group will continue to prepare its consolidated financial statements based onJapanese standards out of consideration of comparability from period to period and between
companies on consolidated financial statements.
In terms of the application of International Financial Reporting Standards (IFRS), we will takeappropriate measures by considering various circumstances in Japan and overseas.

7

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

3. Consolidated Financial Statements and Main Notes(1) Consolidated Balance Sheets

ASSETS
I. Current Assets:
Cash and deposits
Notes and accounts receivable - trade
Merchandise and finished goods
Work in process
Raw materials and supplies
Receivables
Other current assets
Allowance for doubtful accounts
Total Current Assets
II. Fixed Assets:
1. Tangible Fixed Assets:
Buildings and structures
Accumulated depreciation and accumulated
impairment loss
Buildings and structures, net
Machinery, equipment and vehicles
Accumulated depreciation
Machinery, equipment and vehicles, net
Tools, furniture and fixtures
Accumulated depreciation and accumulated
impairment loss
Tools, furniture and fixtures, net
LandConstruction in progress
Total Tangible Fixed Assets
2. Intangible Fixed Assets:
Goodwill
Software
Other intangible fixed assets
Total Intangible Fixed Assets
3. Investments and Other Assets:
Investment securities
Deferred tax assets
Insurance reserve
Other
Allowance for doubtful accounts
Total Investments and Other Assets
Total Fixed Assets
Total Assets

8(Millions of yen)

At December 31, 2022

At December 31, 2023

34,283
15,975
10,529
632
4,156
353
1,439
(226)
67,14334,357
14,412
9,575
515
3,443
1,158
1,581
(245)
64,80023,62028,586(13,121)(14,450)

10,49922,432(17,215)
5,217
10,10814,136
24,465(17,863)
6,602
11,068(7,212)(8,017)

2,896
7,559
3,961
30,132

3,051
7,655
507
31,952

380
1,682
245
2,308

215
1,032
235
1,483

547
900
166
534
(0)
2,149
34,590101,733

558
1,131
－
517
(4)
2,203
35,639100,440

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

(Millions of yen)
At December 31, 2022 At December 31, 2023
LIABILITIES
I. Current Liabilities:
Notes and accounts payable - trade
Electronically recorded obligations - operating
Short-term borrowings
Accounts payable
Accrued expenses
Income taxes payable
Accrued bonuses to employees
Provision for loss on litigation
Other current liabilities
Total Current Liabilities
II. Fixed Liabilities:
Lease liabilities
Deferred tax liabilities
Net defined benefit liability
Provision for share-based remuneration
Other fixed liabilities
Total Fixed Liabilities
Total Liabilities
NET ASSETS
I. Shareholders’ Equity:
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total Shareholders’ Equity
II. Accumulated Other Comprehensive Income:
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Total Accumulated Other Comprehensive Income
III. Non-controlling Interests
Total Net Assets
Total Liabilities and Net Assets

9

5,066
1,542
－
2,373
2,006
989
920
7
2,656
15,563

3,643
1,365
76
2,353
1,805
495
923
6
2,862
13,532

2,057
3,004
566
225
364
6,217
21,781

1,824
2,984
612
190
207
5,820
19,352

5,199
5,132
60,762(1,387)
69,706

5,199
5,132
59,033(1,488)67,876

26
6,962
6,989
3,257
79,952
101,733

33
9,672
9,705
3,505
81,087
100,440

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income(Consolidated Statement of Income)

I. Net Sales
II. Cost of Sales
Gross profit
III. Selling, General and Administrative Expenses
Operating Income
IV. Non-operating Income:Interest income
Dividend income
Subsidy income
Foreign exchange gains
Other non-operating income
Total Non-operating Income
V. Non-operating Expenses:
Interest expenses
Foreign exchange losses
Other non-operating expenses
Total Non-operating Expenses
Ordinary Income
VI. Extraordinary Income:Gain on sales of fixed assets
Subsidy income
Total Extraordinary Income
VII. Extraordinary Loss:
Loss on sales of fixed assets
Loss on disposal of fixed assets
Impairment loss
Loss on tax purpose reduction entry of fixed assets
Total Extraordinary Loss
Income before Income Taxes
Income taxes - current
Income taxes - deferred
Total Corporate Income Tax
Net Income
Net Income Attributable to Non-controlling Interests
Net Income Attributable to Owners of Parent

10

Year Ended
December 31, 2022
94,92150,087
44,834
32,63812,195(Millions of yen)
Year Ended
December 31, 2023
94,46149,00845,452
34,726
10,726

182
17
826
112
279
1,418

256
12
671
－
185
1,126

94
－
54
149
13,465

98
170
60
329
11,522

7
－
7

9
19
29

1
45
282
－
329
13,143
4,678
(296)
4,381
8,761
179
8,581

2
161
213
19
397
11,154
3,778
(186)
3,592
7,561
137
7,423

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

(Consolidated Statement of Comprehensive Income)Net Income
Other Comprehensive Income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Total Other Comprehensive Income
Comprehensive Income(Breakdown)Comprehensive income on parent company
Comprehensive income on non-controlling interests

11

Year Ended
December 31, 2022
8,761(Millions of yen)
Year Ended
December 31, 2023
7,561

9
3,394
3,404
12,165

6
2,972
2,979
10,54011,743422

10,140400

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

(3) Statement of Changes in Consolidated Shareholders’ Equity
Fiscal Year Ended December 31, 2022

(Millions of yen)

Shareholders’ equity
Capital stock
Balance at the beginning of
the period
Changes during the period
Dividends from surplus
Net income attributable toowners of parent
Acquisition of treasury
stock
Disposal of treasury stock
Changes in items other thanshareholders’ equity (net)Total changes during theperiodBalance at the end of current
periodBalance at the beginning of
the period
Changes during the period
Dividends from surplus
Net income attributable toowners of parent
Acquisition of treasury
stock
Disposal of treasury stock
Changes in items other thanshareholders’ equity (net)Total changes during theperiodBalance at the end of current
periodCapitalsurplus

5,199

5,179

Retainedearnings
61,163

Treasury
stock

Total
shareholders’equity(1,479)70,062(8,982)(8,982)

8,581

8,581
(0)

(0)

(46)

(0)

91

44

－

(46)

(401)

91

(356)

5,199

5,132

60,762(1,387)

69,706

Accumulated other comprehensive income
Total
NonForeign
Valuation
accumulated
controllingcurrency
difference on
otherinterests
translation
available-forcomprehensive
adjustment
sale securities
income
16

3,805

3,822

2,925

Total net
assets76,810(8,982)
8,581
(0)
44

9

3,156

3,166

331

3,498

9

3,156

3,166

331

3,142

26

6,962

6,989

3,257

79,95212

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

Fiscal Year Ended December 31, 2023

(Millions of yen)

Shareholders’ equity
Capital stock
Balance at the beginning of
the period
Changes during the period
Dividends from surplus
Net income attributable toowners of parent
Acquisition of treasury
stock
Disposal of treasury stock
Transfer from retained
earnings to capital surplus
Changes in items other thanshareholders’ equity (net)Total changes during theperiodBalance at the end of current
periodBalance at the beginning of
the period
Changes during the period
Dividends from surplus
Net income attributable toowners of parent
Acquisition of treasury
stock
Disposal of treasury stock
Transfer from retained
earnings to capital surplus
Changes in items other thanshareholders’ equity (net)Total changes during theperiodBalance at the end of current
periodCapitalsurplus5,199

Retainedearnings

5,132

60,762

Treasury
stock

Total
shareholders’equity(1,387)

69,706(9,101)(9,101)

7,423

7,423

(50)

(199)

(199)

98

47

50

(50)

－

－

(1,728)(101)(1,829)

5,199

5,132

59,033(1,488)67,876－

Accumulated other comprehensive income
Total
NonForeign
Valuation
accumulated
controllingcurrency
difference on
otherinterests
translation
available-forcomprehensive
adjustment
sale securities
income
26

6,962

6,989

3,257

Total net
assets79,952(9,101)
7,423
(199)
47
－

6

2,709

2,716

247

2,964

6

2,709

2,716

247

1,134

33

9,672

9,705

3,505

81,08713

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

(4) Consolidated Statements of Cash Flows

I. Cash Flows from Operating Activities:
Income before income taxes
Depreciation
Impairment loss
Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in accrued bonuses to employees
Increase (decrease) in net defined benefit liability
Increase (decrease) in provision for share-based
remuneration
Interest and dividend income
Interest expenses
Foreign exchange loss (gain)
Loss (gain) on sales of fixed assets
Loss on disposal of fixed assets
Decrease (increase) in notes and accounts receivable trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable - trade
Increase (decrease) in accounts payable
Increase/decrease in consumption taxes
payable/consumption taxes refund receivable
Other
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes paid
Net Cash Provided by (Used in) Operating Activities
II. Cash Flows from Investing Activities:
Purchase of tangible fixed assets
Proceeds from sales of tangible fixed assets
Purchase of intangible fixed assets
Purchase of investment securities
Purchase of insurance funds
Proceeds from cancellation of insurance funds
Payments for lease deposits
Collection of lease deposits
Other
Net Cash Provided by (Used in) Investing Activities

14

Year Ended
December 31, 2022

(Millions of yen)
Year Ended
December 31, 2023

13,143
4,758
282
189
7
(1)
59

11,154
4,881
213
198
4
(38)
3

(88)

(34)

(199)
94
85
(5)
45

(269)
98
(126)
(6)
161

1,631

2,453

(1,816)
222
(11)

2,544
(2,073)
(6)

(187)

(68)

(395)
17,813152(93)(4,662)
13,210(269)
18,821
166(100)(4,364)
14,523(5,315)
14
(249)
(1)
(1)
－
(38)
21
(88)
(5,659)(5,484)
61
(166)
(1)
(0)
166
(27)
29
(46)
(5,467)

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

III. Cash Flows from Financing Activities:
Increase in short-term loans payable
Payment of cash dividends
Dividends paid to non-controlling interests
Purchase of treasury stock
Proceeds from disposal of treasury stock
Other
Net Cash Provided by (Used in) Financing Activities
IV. Effect of Exchange Rate Change on Cash and Cash
Equivalents
V. Net Increase (Decrease) in Cash and Cash Equivalents
VI. Cash and Cash Equivalents at Beginning of Period
VII. Cash and Cash Equivalents at End of Period

15

Year Ended
December 31, 2022

(Millions of yen)
Year Ended
December 31, 2023－
(8,974)
(93)
(0)
44
(642)
(9,666)76(9,109)
(152)
(199)
47
(918)
(10,256)

1,180

1,275

(934)
35,21834,28374
34,28334,357

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

(5) Notes on Consolidated Financial Statements(Notes Regarding Going Concern Assumptions)Not applicable.
(Important Accounting Estimates)
Accounting estimates are reasonable amounts calculated based on the information available at thetime of preparation of the consolidated financial statements. From among amounts recorded in the
consolidated financial statements for the consolidated fiscal year under review based on accounting
estimates, the following items have a risk of having a significant impact on the consolidated
financial statements for the next consolidated fiscal year.
1. Impairment of fixed assets(1) Amount recorded in the consolidated financial statements for the previous fiscal year
Tangible and intangible fixed assets¥32,441 million
Impairment loss
¥282 million(2) Amount recorded in the consolidated financial statements for the fiscal year under review
Tangible and intangible fixed assets¥33,436 million
Impairment loss
¥213 million(3) Information on the content of important accounting estimates for identified items
1) Calculation method
From among tangible and intangible fixed assets, for assets or asset groups that show signs of
impairment, if the value in use or net sale price obtained from the asset or group of assets is below
its carrying amount, the carrying amount is reduced to the recoverable amount, and the reduced
amount is recorded as an impairment loss.
2) Major assumptions
Future cash flows used in determining whether to recognize an impairment loss and to calculate thevalue in use are calculated based on the business plan approved by management and the subsequentsales-growth rate, etc. The Group also performs calculation by obtaining evaluations from realestate appraisers, etc. for assets that are expected to be sold.
3) Impact on the consolidated financial statements in the next fiscal year
In recognizing the impairment loss, the Group carefully considers future profitability, etc. However,
if we are unable to achieve the important business plan based on the estimated amount of future
cash flow or if future uncertainty increases due to future changes, etc., in the management andmarket environment, there is the possibility that the recoverable amount may decrease and there
will be a significant impact on the consolidated financial statements due to the occurrence of an
impairment loss in the next fiscal year.
2. Possibility of collecting deferred tax assets(1) Amount recorded in the consolidated financial statements for the previous consolidated fiscal
year
Deferred tax assets (net amount)¥900 million
The amount prior to offsetting deferred tax liabilities is ¥1,311 million.
(2) Amount recorded in the consolidated financial statements for the consolidated fiscal year underreview
Deferred tax assets (net amount)¥1,131 million
The amount prior to offsetting deferred tax liabilities is ¥1,707 million.
(3) Information regarding the content of material accounting estimates for identified items
1) Calculation method
The Group records deferred tax assets for deductible temporary differences that are determined tobe recoverable by estimating taxable income based on the budget for the next consolidated fiscal
year and forecasts of future performance, and by considering the feasibility.
16

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

2) Major assumptions
Based on reasonable assumptions made from the current situation and available information, theGroup estimates future performance forecasts which are important in calculating the timing andamount of taxable income.
3) Impact on the consolidated financial statements in the next fiscal year
If there are changes to the preconditions or assumptions made in estimating taxable income and theestimated amount decreases, deferred tax assets may be reduced and the Group may record tax
expenses.
Changes in the effective tax rate due to tax reform may have a significant impact on the amountrecognized in the consolidated financial statements for the next consolidated fiscal year andsubsequent years.
(Additional Information)(BIP Trust System for Compensation of Directors)
Pigeon has introduced a performance share plan for directors (not including outside directors). The
purpose of this system is to clarify the relationship between directors’ compensation and theGroup’s business results and shareholder value and to enhance awareness of contributions to theimprovement of the business results of the Group and the expansion of its enterprise value over the
medium-to-long term.
(1) Overview of the BIP trust system for compensation of directors
This plan adopts a framework called the board incentive plan (BIP) trust for compensation of
directors. Similar to systems in North America and Europe such as performance shares, which
tie compensation to business results, and restricted stock, which compensates directors withshares whose transfer is restricted, the system provides directors with Company shares, ortheir equivalent value at conversion, tied to the director’s rank and the Company’s degree ofattainment of business-result targets. The compensation is transferred or paid to directors.
(2) Company shares remaining in the trust
Company shares remaining in the trust are appropriated as treasury stock in net assets, basedon the book value of the trust (not including the amounts of incidental expenses). The bookvalue of the treasury stock was ¥433 million and number of shares was 102,956 at the end of
the previous consolidated fiscal year, and ¥533 million and 169,948 shares at the end of the
fiscal year under review.

17

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

(Segment Information)
1. Summary of Reporting Segments
In respect of the Company’s reporting segments, these are, of the constituent units in the Group,
those for which separate financial information are available and those that are the subject of regularexamination by the board of directors to make decisions on management resource allocation andassessment of performance.
The Group has a total of four reporting segments: “Japan Business,” “China Business,” “Singapore
Business,” and “Lansinoh Business.”
The types of the Group’s reporting segments are as follows.
(i) Japan BusinessThis segment is engaged in the manufacture and sales of childcare products and feminine products,
provision of childcare services, manufacture and sales of health care products and nursing careproducts, and provision of nursing care services in Japan.
(ii) China BusinessThis segment is engaged in the manufacture and sales of child care products and feminine products
in China, South Korea, Taiwan, Hong Kong, the Philippines, and some other countries.
(iii) Singapore BusinessThis segment is engaged in the manufacture and sales of childcare products and feminine productsin Singapore, Malaysia, India, Indonesia, Thailand, and some other countries.
(iv) Lansinoh BusinessThis segment is engaged in the manufacture and sales of childcare products and feminine productsin the United States, the United Kingdom, Germany, Belgium, China, Turkey, and some othercountries.
2. Calculation Method for the Values in Segmental Sales, Profits or Losses, Assets and Other Items
The accounting method for the reported business segments is in accordance with the accounting
policies adopted to prepare consolidated financial statements.

18

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

3. Information Regarding Net Sales, Profit (Loss), Assets and Other Items in Each Reporting Segment
Fiscal Year Ended December 31, 2022

(Millions of yen)

Reporting Segment
Singapore
Business

Total

LansinohBusinessAmountAccounted on
Consolidated
Financial
Statements(Note 5)Adjustments(Note 1)
(Note 2)
(Note 3)(Note 4)

Japan Business

China BusinessNet sales to externalcustomers

34,232

34,227

9,562

16,89894,921－

94,921

Internal sales or exchange
between segments

2,090

548

4,590

18

7,248

(7,248)－

Total

36,323

34,77614,153

16,917102,170(7,248)94,921

Segment Profit

1,491

10,408

2,140

1,154

15,194(2,998)12,195

Segment Assets

25,16019,097

10,351

11,636

66,24535,488

101,733

Net Sales

Other Items
Depreciation
1,068
1,722
1,035
342
4,167
590
(Note 6)
Amortization of Goodwill
182
6
189
－
－
－
Increase in Tangible Fixed
Assets and Intangible Fixed
3,387
1,681
828
1,280
7,177
81
Assets(Note 7)(Notes)1. The negative amount of ¥2,998 million from adjustments in segment profit includes ¥53 million in elimination of intersegment transactions
and negative ¥3,052 million in non-allocable operating expenses. Non-allocable operating expenses are mainly administrative costs of ourGroup.
2. The amount of ¥35,488 million in adjustments in segment assets includes negative ¥1,739 million in eliminations of inter-segment transactions,and ¥37,228 million in the entire company assets consisting principally of investments of surplus of the parent company (Cash and Deposits),
long term investment assets (Investment Securities and the Like) and assets relating to the administrative area.
3. Depreciation adjustments are depreciations relating the entire company assets.
4. Adjustments of increase in tangible fixed assets and intangible fixed assets relate to the entire company assets.
5. Segment profit has been adjusted with the operating income in the consolidated financial statements.
6. Amortization relating to long term pre-paid expenses are included in the depreciation.
7. Increases in tangible fixed assets and intangible fixed assets include increases in long term pre-paid expenses.

19

4,758
189
7,259

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

Fiscal Year Ended December 31, 2023

(Millions of yen)

Reporting Segment
Singapore
Business

Total

LansinohBusinessAmountAccounted on
Consolidated
Financial
Statements(Note 5)Adjustments(Note 1)
(Note 2)
(Note 3)(Note 4)

Japan Business

China BusinessNet sales to externalcustomers

35,02732,3108,650

18,472

94,461－

94,461

Internal sales or exchange
between segments

1,838

734

4,434

8

7,016

(7,016)－Total

Net Sales

36,86533,045

13,08518,480101,477(7,016)

94,461

Segment Profit

2,006

8,858

1,235

1,453

13,554(2,828)

10,726

Segment Assets

27,54816,653

9,599

11,26465,06635,373

100,440

Other Items
Depreciation
1,105
1,584
1,116
495
4,301
579
(Note 6)
Amortization of Goodwill
191
7
198
－
－
－
Increase in Tangible Fixed
Assets and Intangible Fixed
4,088
1,066
880
225
6,261
59
Assets(Note 7)(Notes)1. The negative amount of ¥2,828 million from adjustments in segment profit includes ¥194 million in elimination of intersegment transactions
and negative ¥3,022 million in non-allocable operating expenses. Non-allocable operating expenses are mainly administrative costs of ourGroup.
2. The amount of ¥35,373 million in adjustments in segment assets includes negative ¥1,311 million in eliminations of inter-segment transactions,and ¥36,685 million in the entire company assets consisting principally of investments of surplus of the parent company (Cash and Deposits),
long term investment assets (Investment Securities and the Like) and assets relating to the administrative area.
3. Depreciation adjustments are depreciations relating the entire company assets.
4. Adjustments of increase in tangible fixed assets and intangible fixed assets relate to the entire company assets.
5. Segment profit has been adjusted with the operating income in the consolidated financial statements.
6. Amortization relating to long term pre-paid expenses are included in the depreciation.
7. Increases in tangible fixed assets and intangible fixed assets include increases in long term pre-paid expenses.

20

4,881
198
6,320

Pigeon Corporation (7956) Summary of Financial Results for the Fiscal Year Ended December 2023

(Per Share Information)
Previous fiscal year

Net Assets per ShareNet Income per Share

(January 1 to December 31, 2022)¥640.96¥71.72Current fiscal year

(January 1 to December 31, 2023)¥648.73¥62.06(Notes) 1. With respect to diluted net income per share, there are no latent shares, thus, has not been disclosed.
2. Company shares held by the BIP trust for compensation of directors are included in the treasury stock subtracted from thetotal number of shares outstanding at the period-end when calculating the net assets per share (102,956 shares for theprevious fiscal year; 169,948 shares for the current fiscal year).
Furthermore, company shares held by the BIP trust for compensation of directors are included the treasury stock
subtracted in the calculation of the average number of shares outstanding during the period when calculating the net
income per share (108,469 shares for the previous fiscal year; 142,676 shares for the current fiscal year).
3. The basis for the calculation of the net income per share is as follows.

Previous fiscal year

Net Income Attributable to Owners of
Parent (¥ millions)
Amount Not Attributable to Ordinary
Shareholders (¥ millions)
Net Income Attributable to Owners of
Parent Relating to Ordinary Shares(¥ millions)Average Number of Ordinary Shares
During the Term (shares)(January 1 to December 31, 2022)(Material Subsequent Events)
Not applicable.

21

Current fiscal year

(January 1 to December 31, 2023)

8,581

7,423

－

－

8,581

7,423

119,651,570

119,617,076