August 8, 2017

Consolidated Financial Results
for the Three Months Ended June 30, 2017
(Japanese Accounting Standards)
Name of the Listed Company: Nitta Gelatin Inc.
Listing:First Section of Tokyo Stock Exchange
Stock code:4977
URL:
http://www.nitta-gelatin.co.jp
Representative:
Koichi Ogata, Representative Director and President
Contact Person:
Toru Tamaoka, Director and Executive Officer;
General Manager of Administration Division
Tel: +81-72-949-5381
Scheduled date to file Quarterly Securities Report: August 9, 2017
Scheduled date to commence dividend payments: Supplementary explanatory materials prepared:
NoExplanatory meeting:
No(Millions of yen with fractional amounts discarded, unless otherwise noted.)

1. Consolidated financial results for the three months ended June 30, 2017(from April 1, 2017 to June 30, 2017)(1) Consolidated operating results(Percentages indicate year-on-year changes.)
Net income
Net sales
Three months ended
June 30, 2017
June 30, 2016

Millions of yen%

Operating income

Ordinary income

attributable to ownersof the parent

Millions of yen

Millions of yen%

Millions of yen

383
290

31.7(4.4)

234
175%

9,240
2.3274(43.6)
9,031
(1.6)
486
64.7
Note: Comprehensive income
For the three months ended June 30, 2017: ¥298 million, (-%)
For the three months ended June 30, 2016: ¥(595) million, (-%)

Net income
per share
Three months ended
June 30, 2017
June 30, 2016

Diluted net income
per share

Yen

Yen

12.77
9.57
Note: Diluted net income per share is not disclosed due to the absence of latent shares with dilution effect.

(2) Consolidated financial position
As ofJune 30, 2017
March 31, 2017

Total assets

Net assets

Millions of yen

Millions of yen

39,646
40,41018,01017,736Reference: Equity
As of June 30, 2017:¥16,029 million
As of March 31, 2017: ¥15,727 million

Equity ratio%

40.4
38.9%

33.4
225.9

2. Cash dividends
Cash dividends per shareFirst quarter

Second quarter

Yen

Fiscal year ended March 31,
2017
Fiscal year ending March 31,
2018

Third quarter

Yen-

Fiscal year-end

Yen

Annual

Yen

Yen

6.00

-

6.00

12.00

6.00

-

6.00

12.00

-

Fiscal year ending March 31,2018 (Forecasts)

Note: Changes to most recent dividend forecasts: None

3. Consolidated financial forecasts for the fiscal year ending March 31, 2018(from April 1, 2017 to March 31, 2018)
OperatingincomeNet sales

Six months ending
September 30, 2017
Fiscal year ending
March 31, 2018

(Percentages indicate year-on-year changes.)
Net income
Ordinary
Net income
attributable to ownersof the parent

incomeper share

Millionsof yen%Millionsof yen%Millionsof yen%Millionsof yen%18,7005.3650(29.7)

650(5.6)400(1.3)

21.77

38,5005.3

1,500(1.1)

1,600(12.6)

1,000

44.2

54.43

Yen

Note: Changes to most recent consolidated financial forecasts: NoneNotes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in achange in the scope of consolidation): None
New:
None
Excluded:None(2) Adoption of special accounting methods for the preparation of quarterly consolidated financial
statements: No(3) Changes in accounting policies, changes in accounting estimates, and restatement of revisions
a. Changes in accounting policies due to revisions to accounting standards and other guidelines: No
b. Changes in accounting policies due to reasons other than a. above: No
c. Changes in accounting estimates: Yes
d. Restatement of revisions: No
Note: For details, please refer to “(3) Notes to Quarterly Consolidated Financial Statements (Changes in Accounting
Estimates)” in “2. Quarterly Consolidated Financial Statements and Key Notes” on page 9 of the Attachment tothis report.

(4) Number of common shares issued
a. Total number of issued shares at the end of the period (including treasury stock)
As of June 30, 201718,373,974 shares
As of March 31, 201718,373,974 sharesb. Number of shares of treasury stock at the end of the period
As of June 30, 2017
162 shares
As of March 31, 2017
162 sharesc. Average number of shares
For the three months ended June 30, 2017
For the three months ended June 30, 2016

18,373,812 shares
18,373,812 shares* This report falls outside the scope of quarterly review procedures.
* 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. These statements do not guarantee that theCompany will achieve its earnings forecasts. In addition, actual business and other results may differ substantially due to variousfactors. For details on the conditions assumed and the cautionary notes and items in the financial forecasts, please refer to “(3)Description of Consolidated Business Forecasts and Other Forward-looking Information” in “1. Qualitative Information
Concerning Quarterly Financial Statements” on page 3 of the Attachment to this report.

Attachment Contents
1. Qualitative Information Concerning Quarterly Financial Statements ···································· 2(1) Description of Business Results ·················································································· 2(2) Description of Financial Position ················································································ 3(3) Description of Consolidated Business Forecasts and Other Forward-looking Information ·············· 3

2. Quarterly Consolidated Financial Statements and Key Notes ············································· 5(1) Consolidated Balance Sheets ····················································································· 5(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income ········· 7
Consolidated Statements of Income(First quarter consolidated cumulative accounting period) ··················································· 7
Consolidated Statements of Comprehensive Income(First quarter consolidated cumulative accounting period) ··················································· 8(3) Notes to Quarterly Consolidated Financial Statements ······················································· 9(Note Concerning Going Concern Assumption) ······························································· 9(Note Concerning Significant Changes in Shareholders’ Equity) ··········································· 9(Changes in Accounting Estimates)·············································································· 9(Segment Information) ·························································································· 101

1. Qualitative Information Concerning Quarterly Financial Statements(1) Description of Business Results
In the first quarter of the fiscal year ending March 31, 2018, global economies continued torecovery gradually, mainly supported by the recovery in advanced economies, primarily theU.S., and rapid growth of the Indian economy. Nevertheless, risk factors remain, such as thepolicies of the new U.S. administration and the U.K.’s serious discussion about departure fromthe EU.
The Japanese economy continued on a moderate recovery trend, supported by capital
expenditures in response to labor shortages and growth in exports to the U.S. and China.
Under these conditions, as the Nitta Gelatin Group approaches its 100th founding
anniversary in 2018, it formulated a new corporate vision in April 2017 and conducted areorganization to realize it.

New Vision“To stay healthy and feeling young”
Nitta Gelatin Group fulfills this desire of people worldwide through our relentless pursuit ofrealizing collagen’s enormous potential.
1. We will provide products and services that meet our customers’ expectations of continuedimprovement.
2. We will broaden the range of collagen applications through our ongoing efforts in R&Dand production innovation.
3. We will pioneer and create new markets by fostering a corporate culture that encourages
facing and overcoming challenges.
Under this corporate vision, the Nitta Gelatin Group worked to strengthen its competitive
capabilities by reducing costs through production efficiency improvements and ensuring
optimal production and optimal sales. It also focused on providing products that create newvalue, and on research and development in the fields of health and beauty and regenerative
medicine.
As a result, for the first quarter of the fiscal year ending March 31, 2018, net sales increased
2.3% year on year to ¥9,240 million and operating income decreased 43.6% to ¥274 million.
Ordinary income rose 31.7% to ¥383 million, mainly due to foreign exchange gains. Net
income attributable to owners of the parent increased 33.4% year on year to ¥234 million.
Segment business performance was as follows:(a) Collagen Material BusinessIn the gelatin field, in Japan gelatin-for-food sales increased, such as delicatessen items soldin convenience stores, but sales of gelatin-for-capsules were weak. In North America, sales ofgelatin-for-capsules showed signs of recovery, and sales expansion of gelatin-for-food also2contributed to overall sales growth. Profits declined, mainly reflecting an increase in raw
material prices.
In the collagen peptide field, earnings recovered, partly due to the contribution of a boost insales from increased recognition. In collagen casings, sales continued to trend firmly in NorthAmerica.
As a result, net sales in this segment increased 3.3% to ¥6,694 million, while segment profit(operating income) decreased 48.6% to ¥267 million.
(b) Formula Solution BusinessIn food materials, sales were level year on year overall. Sales in the delicatessen foods
market were strong, but sales for use in confectionery and desserts trended slightly lower year
on year.
In adhesives, overall sales were lifted by a contribution from an increase in sales for hygiene
products. Sales also increased due to an expansion in applications for high-functional resins.
As a result, net sales in the segment were down 0.2% year on year to ¥2,545 million andsegment profit (operating income) increased 17.0% year on year to ¥339 million.

(2) Description of Financial Position(Assets)
Total assets amounted to ¥39,646 million at June 30, 2017, ¥764 million lower than at March
31, 2017. This was mainly attributable to decreases in cash and deposits and notes and accounts
receivable-trade.
(Liabilities)
Total liabilities stood at ¥21,636 million at June 30, 2017, ¥1,038 million lower than at March
31, 2017. This was mainly attributable to decreases in notes and accounts payable-trade,
income taxes payable, and long-term loans payable.
(Net assets)
Net assets amounted to ¥18,010 million at June 30, 2017, ¥274 million higher than at March 31,
2017. This was mainly attributable to increases in retained earnings and valuation difference onother available-for-sale securities.
As a result, the equity ratio stood at 40.4% at June 30, 2017, compared to 38.9% at March31, 2017.

(3) Description of Consolidated Business Forecasts and Other Forward-looking
Information
The consolidated earnings forecast for the fiscal year ending March 31, 2018 is unchanged3

from the consolidated earnings forecast announced on May 10, 2017 in the “Consolidated
Financial Results for the Fiscal Year Ended March 31, 2017.”
Actual business and other results may differ substantially from projections due to variousfactors.

4

2. Quarterly Consolidated Financial Statements and Key Notes(1) Consolidated Balance Sheets(Millions of yen)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
Other, net
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
OtherAllowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets

5Fiscal 2017
(As of March 31, 2017)

1Q Fiscal 2018
(As of June 30, 2017)

2,662
8,923
5,043
1,163
2,997
918
(22)
21,686

2,045
8,615
5,400
1,201
2,808
940
(23)
20,988

4,339
4,882
4,688
13,910

4,271
4,842
4,665
13,779

454
405
859

441
399
841

3,052
902
(0)
3,954
18,72440,410

3,143
893
(0)
4,037
18,65839,646

(Millions of yen)

Fiscal 2017
(As of March 31, 2017)
Liabilities
Current liabilities
Notes and accounts payable-trade
Short-term loans payable
Current portion of long-term loans payable
Income taxes payable
Provision for bonuses
Other
Total current liabilities
Noncurrent liabilities
Long-term loans payable
Net defined benefit liability
Other
Total noncurrent liabilities
Total liabilities
Net Assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on other available-for-salesecurities
Deferred gains (losses) on hedges
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

6

1Q Fiscal 2018
(As of June 30, 2017)

4,347
2,866
2,432
509
259
2,622
13,037

4,141
3,029
2,322
272
413
2,414
12,593

5,425
2,851
1,359
9,636
22,674

4,862
2,888
1,292
9,042
21,636

3,144
2,966
10,042(0)
16,153

3,144
2,966
10,257(0)
16,369

1,107

1,210

43
331
(1,907)(426)
2,009
17,736
40,4107330(1,888)(339)
1,981
18,01039,646

(2) Consolidated Statements of Income and Consolidated Statements ofComprehensive Income
Consolidated Statements of Income(First quarter consolidated cumulative accounting period)(Millions of yen)

1Q Fiscal 2017
(From April 1, 2016
to June 30, 2016)
9,031
6,979

1Q Fiscal 2018
(From April 1, 2017
to June 30, 2017)
9,240
7,351

Gross profit on sales

2,052

1,888

Selling, general and administrative expenses

1,565

1,614

486

274

4
1439
4002785
39
2199

174

62
228
357

294

66

290

383

1-

1-

Income before provision for income taxes

289

383

Income taxes

120127

Net income
Net income (loss) attributable to non-controllinginterests
Net income attributable to owners of the parent

168

255

(7)

20175

234

Net sales
Cost of sales

Operating income
Non-operating income
Interest income
Dividend income
Foreign exchange gains
Equity in earnings of affiliates
Other-

Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
OtherTotal non-operating expenses
Ordinary income
Extraordinary losses
Loss on retirement of noncurrent assets
Total extraordinary losses

7-8Consolidated Statements of Comprehensive Income(First quarter consolidated cumulative accounting period)(Millions of yen)

1Q Fiscal 2017
(From April 1, 2016
to June 30, 2016)
168

Net income
Other comprehensive income (loss)
Valuation difference on other available-for-salesecurities
Deferred losses on hedges

1Q Fiscal 2018
(From April 1, 2017
to June 30, 2017)
255

(162)

103

(23)

(69)

Foreign currency translation adjustments(743)

14Pension liability adjustment
Share of other comprehensive loss of associates
accounted for using equity method
Total other comprehensive income (loss)

212

19(46)

(23)

(763)

42(595)298

Owners of the parent

(450)

320

Non-controlling interests

(144)

(22)

Total comprehensive income
Comprehensive income attributable to:8(3) Notes to Quarterly Consolidated Financial Statements(Note Concerning Going Concern Assumption)
None(Note Concerning Significant Changes in Shareholders’ Equity)
None(Changes in Accounting Estimates)(Change in the useful life)
The machinery and equipment owned by certain consolidated subsidiaries had been
estimated to have a useful life of eight years for depreciation purposes, based on its usage
status. In the fiscal year ending March 31, 2018, the useful life has been revised based on
the actual number of years of use and other factors in conjunction with plan to operate
new machinery and equipment, and is now clearly expected to be longer than theprevious estimate. From the first quarter of the fiscal year ending March 31, 2018, theuseful life has therefore been changed to 10 years.
As a result, for the first quarter of the fiscal year ending March 31, 2018 the amount ofdepreciation and amortization has declined by ¥11 million compared to the previous
estimation method, and operating income, ordinary income, and income before income
taxes and minority interests have all increased by the same amount.

9

(Segment Information)
I. First three months of the fiscal year ended March 31, 2017 (From April 1, 2016 to June 30,2016)
1. Information on net sales, income and loss by reporting segment
Reporting segment
CollagenmaterialbusinessNet sales
Sales to third parties
Inter-segment sales andtransfers
Total
Segment income(Millions of yen)Amounts in the
consolidated
financialstatements*2

Formulasolution
business

Total

Adjustments*1

6,481

2,549

9,031

-

9,031

455

4460(460)

-

6,937
519

2,554
290

9,491
809

(460)
(322)

9,031
486

(Notes) 1. Adjustment for segment income of ¥(322) million comprises elimination ofintersegment transactions of ¥(4) million and unallocated expenses of ¥(318)million.
2. Segment income is adjusted against the operating income recorded in theconsolidated income statement.

2. Information on impairment loss on noncurrent assets and goodwill by reporting segments
None
II. First three months of the fiscal year ending March 31, 2018 (From April 1, 2017 to June30, 2017)
1. Information on net sales, income and loss by reporting segment
Reporting segment
Collagenmaterial
business
Net sales
Sales to third parties
Inter-segment sales andtransfers
Total
Segment income(Notes)(Millions of yen)Amounts in theconsolidated
financialstatements*2

Formulasolution
business

Total

Adjustments*1

6,694

2,545

9,240

-

9,240

401

3405(405)

-

7,096
267

2,549
339

9,646
606(405)(331)

9,240
274

1. Adjustment for segment income of ¥(331) million comprises elimination ofintersegment transactions of ¥(0) million and unallocated expenses of ¥(331)million.
2. Segment income is adjusted against the operating income recorded in theconsolidated income statement.

2. Information on impairment loss on noncurrent assets and goodwill by reporting segments
None10