August 8, 2019

Consolidated Financial Results
for the Three Months Ended June 30, 2019
(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:
Norifumi Nagaoka, Director and Executive Officer;
General Manager of General Management Division
Tel: +81-72-949-5381
Scheduled date to file Quarterly Securities Report: August 9, 2019
Scheduled date to commence dividend payments: Supplementary explanatory materials prepared:No
Explanatory meeting:
No(Millions of yen with fractional amounts discarded, unless otherwise noted.)

1. Consolidated financial results for the three months ended June 30, 2019(from April 1, 2018 to June 30, 2019)(1) Consolidated operating results(Percentages indicate year-on-year changes.)
Net sales
Three months ended
June 30, 2019
June 30, 2018

Millions of yen%

Operating income

Ordinary income

Net income
attributable toowners of the parent

Millions of yen

Millions of yen%

Millions of yen

367
373

(1.6)
(2.4)

253
48%

9,260
2.4
374
30.6
9,043(2.1)
287
4.5
Note: Comprehensive income
For the three months ended June 30, 2019: ¥50 million, (72.2)%
For the three months ended June 30, 2018: ¥182 million, (38.6)%

Net income
per share
Three months ended
June 30, 2019
June 30, 2018

Diluted net income
per share

Yen

Yen

13.80
2.64
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, 2019
March 31, 2019

Total assets

Net assets

Millions of yen

Millions of yen

37,26537,715

17,56917,708Reference: Equity
As of June 30, 2019:¥15,727 million
As of March 31, 2019: ¥15,843 million

Equity ratio%

42.2
42.0%

422.3
(79.3)

2. Cash dividends
Cash dividends per shareFirst quarter

Second quarter

Yen

Fiscal year ended March 31,
2019
Fiscal year ending March 31,
2020

Third quarter

Yen-

Fiscal year-end

Yen

Annual

Yen

Yen

6.00

-

10.00

16.00

6.00

-

6.00

12.00

-

Fiscal year ending March 31,
2020 (Forecasts)

Note: Changes to most recent dividend forecasts: None

3. Consolidated financial forecasts for the fiscal year ending March 31, 2020
(from April 1, 2019 to March 31, 2020)(Percentages indicate year-on-year changes.)
Net sales
Millionsof yen%Operating income

Ordinary income

Net income
attributable toowners of theparent

Millionsof yenMillionsof yen%Millionsof yen%(15.9)

300(76.1)

16.33

56.9

800

(19.1)

43.54%

Six months ending
18,8004.460039.9500
September 30, 2019
Fiscal year ending
38,200
4.8
1,400
55.9
1,300
March 31, 2020
Note: Changes to most recent consolidated financial forecasts: NoneNet income
per shareYen(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: Yes
b. Changes in accounting policies due to reasons other than a. above: No
c. Changes in accounting estimates: No
d. Restatement of revisions: No
Note: For details, please refer to “(3) Notes to Quarterly Consolidated Financial Statements in “2. Quarterly Consolidated
Financial Statements and Key Notes” on page 9 of the Attachment to this 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, 201918,373,974 shares
As of March 31, 201918,373,974 sharesb. Number of shares of treasury stock at the end of the period
As of June 30, 2019163 shares
As of March 31, 2019163 sharesc. Average number of shares
For the three months ended June 30, 2019
For the three months ended June 30, 2018

18,373,811 shares
18,373,812 shares* This financial report falls outside the scope of quarterly review procedures by Certified Public Accountants or
the independent auditor.
* 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 4 of the Attachment to this report.
OtherThe Company’s consolidated subsidiary, Nitta Gelatin India Ltd. resolved at a Board of Directors meeting held on November 8,
2018, to merge with its subsidiary Reva Proteins Ltd., and conducted the merger effective from April 1, 2017. The merger reference
date is set retrospectively as the beginning of the fiscal year in which the merger application was filed, in accordance with themerger system in India.

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

4

2. Quarterly Consolidated Financial Statements and Key Notes5(1) Consolidated Balance Sheets

5(2) Consolidated Statements of Income and Consolidated Statements ofComprehensive 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 policies)

9(Proposed Amendments to Practical Solution on Unification ofAccounting Policies Applied to Foreign Subsidiaries, etc. for
Consolidated Financial Statements)

9(Segment Information)101

1. Qualitative Information Concerning Quarterly Financial Statements
In the first quarter of the year ending March 31, 2020, retroactive processing has been appliedand figures reflect relevant content for comparison and analysis with the previous fiscal year.
The Company’s consolidated subsidiary, Nitta Gelatin India Ltd. resolved at a Board ofDirectors meeting held on November 8, 2018, to merge with its subsidiary Reva Proteins
Ltd., and conducted the merger effective from April 1, 2017.
The merger reference date is set retrospectively as the beginning of the fiscal year in which
the merger application was filed, in accordance with the merger system in India.

(1) Description of Business Results
In the first quarter of the fiscal year ending March 31, 2020, the global economy continued to
grow gradually as economic recovery continued in the U.S. and despite signs of weakness inAsia and Europe. The Japanese economy continued on a moderate recovery trend supported bya firm undertone in capital investment, but the outlook has become increasingly uncertain basedin part on trends in trade problems and the deceleration of the Chinese economy.
In this environment, the Nitta Gelatin Group will implement the following management
policies under the Medium-Term Management Plan:
1. Our three core areas will be food solutions, health support, and biomedical.
2. We will globally optimize our production system in Japan, Asia, and North America in
response to an era of completely free trade.
3. We will promote selection and concentration and create high-value added products andservices to recreate the company as a higher-profit enterprise.
Guided by these management policies, the Group actively worked on research and developmentof high-value-added products, sales of new products and development of new markets in its
three core areas. The Group strove to enhance productivity and reduce costs at each of its
manufacturing sites. The Company focused on finding new customers for foods in Southeast
Asian markets as a core area initiative.
As a result, for the first quarter of the fiscal year ending March 31, 2020, net sales increased
2.4% year on year to ¥9,260 million, operating income rose 30.6% to ¥374 million, but ordinary
income decreased 1.6% to ¥367 million, mainly due to the recording of foreign exchange losses,
and net income attributable to owners of the parent increased 422.3% to ¥253 million.
The Nitta Gelatin Group's collagen business has become the Company’s only reporting segment,
but an overview of the performance of each sales category is as follows:2

Food solutions
In Japan, net sales increased due to an active gummy market sparked by a client’s launch of anew product. Sales of delicatessen items for convenience stores increased against a backdrop ofa growing trend of eating alone and demand for ready-made meals continuing to increase, andaggressive marketing activities that produced an increase in sales. Overseas, net sales decreasedin the collagen casing market due to fierce competition in the snack sausage market.
As a result, overall sales in the food solutions category decreased 2.0% year on year to¥3,847 million.
Health support
In Japan, net sales of collagen peptide for beauty supplement applications increased due to thelaunch of a customer’s new product and product renewals.
Overseas, net sales increased, driven by an expansion of the collagen supplement market inNorth America and solid sales of capsules for health foods. In India, net sales increased as
demand for capsules for pharmaceutical and health food applications was solid. Meanwhile, inChina, the collagen peptide market for health and beauty applications that had continued to
expand is now facing an adjustment period, but net sales increased due to a shift in focus toexport sales.
As a result, overall sales in the health support category increased 20.4% year on year to¥3,904 million.
Specialties
In adhesives, overall sales decreased 19.5% year on year to ¥1,508 million, influenced bydeclining sales in adhesives for hygiene products and sales price change accompanying acompany split.

(2) Description of Financial Position(Assets)
Total assets amounted to ¥37,265 million at June 30, 2019, ¥450 million lower than at March
31, 2018. This was mainly attributable to decreases in notes and accounts receivable-trade.
(Liabilities)
Total liabilities stood at ¥19,696 million at June 30, 2019, ¥310 million lower than at March 31,
2018. This was mainly attributable to decreases in long-term loans payable.

3

(Net assets)
Net assets amounted to ¥17,569 million at June 30, 2019, ¥139 million lower than at March 31,
2018. This was mainly attributable to decreases in valuation difference on available-for-salesecurities and foreign currency translation adjustments.
As a result, the equity ratio stood at 42.2% at March 31, 2019 compared with 42.0% atMarch 31, 2018.

(3) Description of Consolidated Business Forecasts and Other Forward-looking
Information
The consolidated earnings forecast for the fiscal year ending March 31, 2020 is unchanged
from the consolidated earnings forecast announced on May 14, 2019 in the “Consolidated
Financial Results for the Fiscal Year Ended March 31, 2019.”
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)

Fiscal 2019
(As of March 31, 2019)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade
Merchandise and finished goods
Work in process
Raw materials and supplies
OtherAllowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings and structures, netMachinery, equipment and vehicles, net
Other, net
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Other
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets

51Q Fiscal 2020
(As of June 30, 2019)

2,092
8,589
5,884
1,350
2,911
558
(9)
21,378

1,903
8,130
6,476
1,367
2,855
543
(10)
21,266

3,788
4,648
3,113
11,551

3,679
4,433
3,156
11,269

353
231
585

331
224
556

3,260
1,134(193)
4,200
16,33737,7153,138
1,223(188)4,173
15,99937,265

(Millions of yen)

Fiscal 2019
(As of March 31, 2019)
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 stockCapital 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

61Q Fiscal 2020
(As of June 30, 2019)

4,794
2,657
2,386
237
205
2,278
12,559

4,896
2,974
2,215
116
318
2,243
12,764

4,000
2,731
714
7,447
20,007

3,528
2,749
654
6,931
19,696

3,144
2,966
10,155
(0)

3,144
2,966
10,221(0)

16,266

16,333

1,274

1,163(8)174(1,863)
(423)

(16)
28(1,780)
(605)

1,865
17,70837,715

1,841
17,56937,265

(2) Consolidated Statements of Income and Consolidated Statements ofComprehensive Income
Consolidated Statements of Income(First quarter consolidated cumulative accounting period)(Millions of yen)Three Months Ended
June 30, 2018
(From April 1, 2018
to June 30, 2018)
9,043
7,066

Net sales
Cost of sales
Gross profit on sales
Selling, general and administrative expenses
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
Other
Total non-operating expenses
Ordinary income
Extraordinary losses
Disposal costs for noncurrent assets
Loss on retirement of noncurrent assets
Advisory fees
Total extraordinary losses
Income before provision for income taxes
Income taxes
Net income
Net income attributable to non-controlling interests
Net income attributable to owners of the parent

7

Three Months Ended
June 30, 2019
(From April 1, 2019
to June 30, 2019)
9,260
7,348

1,976
1,689
287

1,912
1,537
374

2
18
69
37
23

018－
2235

151

77

58－
542
39
2

64
373

84
367

0
91
180
272
101
34
67
1848－
0－
0367
86
280
27253

Consolidated Statements of Comprehensive Income(First quarter consolidated cumulative accounting period)(Millions of yen)Three Months Ended
June 30, 2018
(From April 1, 2018
to June 30, 2018)67

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

Three Months Ended
June 30, 2019
(From April 1, 2019
to June 30, 2019)280

81(111)15(9)Foreign currency translation adjustments

64(204)

Pension liability adjustment
Share of other comprehensive loss of associates
accounted for using equity method
Total other comprehensive income(25)

83(20)

11115(229)

182

50

Owners of the parent

208

71

Non-controlling interests

(25)

(20)

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 policies)
Application of IFRS 16 Leases
The Nitta Gelatin Group adopted IFRS 16 “Leases” for all overseas subsidiaries except
those in the U.S. from the first quarter of the fiscal year ending March 31, 2020. As atransitional measure upon the adoption of IFRS 16, the Group applies this standard
retrospectively with the cumulative effect of initially applying this standard recognized at
the date of initial application.
As a result, the Consolidated Balance Sheets for the first quarter of the fiscal year
ending March 31, 2020 show increases of ¥85 million in Other, under Property, plant andequipment, ¥22 million in Other under Current liabilities and ¥63 million in Other under
Noncurrent liabilities.
The effect of this change on the Company's consolidated profit and loss for the firstquarter of the fiscal year ending March 31, 2020 is negligible.
(Proposed Amendments to Practical Solution on Unification of Accounting Policies
Applied to Foreign Subsidiaries, etc. for Consolidated Financial Statements)
The Group has adopted the revised PITF No.18 Practical Solution on Unification ofAccounting Policies Applied to Foreign Subsidiaries, etc. for Consolidated FinancialStatements (revised June 28, 2019) and PITF No.24 Practical Solution on Unification ofAccounting Policies Applied to Associates Accounted for Using the Equity Method(revised September 14, 2018) for the first quarter of the fiscal year ending March 31, 2020.
The effect of adopting these revised practical solutions on Consolidated Financial
Statements is negligible.

9(Segment Information)
I. First three months of the fiscal year ended March 31, 2019
(From April 1, 2018 to June 30, 2018)
The Nitta Gelatin Group's collagen business has become the Company’s only
reporting segment, so information is omitted.
II. First three months of the fiscal year ending March 31, 2020
(From April 1, 2019 to June 30, 2019)
The Nitta Gelatin Group's collagen business has become the Company’s only
reporting segment, so information is omitted.

10