August 6, 2014

Consolidated Financial Results
for the Three Months Ended June 30, 2014
(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:
Norimichi Soga, Representative Director and President
Contact Person:
Tsuneo Sasaki, Director and Senior Managing Executive Officer;
General Manager of the General Administration Division
Tel: +81-72-949-5381
Scheduled date to file Quarterly Securities Report: August 8, 2014
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, 2014
(from April 1, 2014 to June 30, 2014)(1) Consolidated operating results(Percentages indicate year-on-year changes.)
Net sales
Three months ended
June 30, 2014
June 30, 2013

Operating income

Ordinary income

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen

%

8,016
7,992

0.3
13.0

240
451

(46.8)(23.1)

219
562(61.0)
(8.5)

158
375

(57.8)(18.0)

Note: Comprehensive income
For the three months ended June 30, 2014: ¥249 million (-52.9%)
For the three months ended June 30, 2013: ¥530 million (283.9%)

Net income
per share
Three months ended
June 30, 2014
June 30, 2013

Net income

Diluted net income
per share

Yen

Yen

8.64
23.84

－
－

(2) Consolidated financial position
Total assets
As ofJune 30, 2014
March 31, 2014

Net assets

Equity ratio

Millions of yen

Millions of yen%

31,084
31,38914,202
13,781

45.3
43.4

Reference: Equity
As of June 30, 2014: ¥14,081 million
As of March 31, 2014: ¥13,636 million

2. Cash dividends
Cash dividends per shareFirst quarter

Second quarter

Third quarter

Fiscal year-end

Annual

Yen

Yen

Yen

Yen

Yen

–

6.00

–

6.00

12.00

6.00

–

6.00

12.00

Fiscal year ended March 31,
2014
Fiscal year ending March
31, 2015
Fiscal year ending March
31, 2015 (Forecasts)–

Note: Changes to most recent dividend forecasts: None

3. Consolidated financial forecasts for the fiscal year ending March 31, 2015
(from April 1, 2014 to March 31, 2015)
Net sales

Six months ending
September 30, 2014
Fiscal year ending
March 31, 2015

(Percentages indicate year-on-year changes.)
Ordinary
Net income
Net income
incomeper share

OperatingincomeMillionsof yen%Millionsof yen%Millionsof yen%Millionsof yen%Yen

18,000

12.3

800

46.8

800

26.9

500

8.5

27.21

36,500

11.2

1,800

88.4

1,900

70.4

1,200

80.3

65.31

Note: Changes to most recent consolidated financial forecasts: None

Notes
(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) Changes in Accounting Policies and Estimates, and Restatementof Revisions” in “2. Matters Concerning Summary Information (Notes)” on page 5 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, 2014
18,373,974 shares
As of March 31, 2014
18,373,974 sharesb. Number of shares of treasury stock at the end of the period
As of June 30, 2014
162 shares
As of March 31, 2014
162 sharesc. Average number of shares
For the three months ended June 30, 2014
For the three months ended June 30, 2013

18,373,812 shares
15,769,912 shares* Disclosure of status of quarterly review procedure
This report falls outside the scope of quarterly review procedures as laid out in the Financial Instruments
and Exchange Act. As of the time of the release of this report, the review of the financial statements, etc.,
outlined in the Act had not yet been concluded.
* 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 the Company will achieve its earnings forecasts. In addition,
actual business and other results may differ substantially due to various factors. For details on theconditions 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 thisreport.

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. Matters Concerning Summary Information (Notes)･････････････････････････････････････ 5(1) Significant Changes in Subsidiaries During the Quarterly Period Under Review･･････････････ 5(2) Application of Special Accounting Methods in the Preparation of Quarterly Consolidated
Financial Statements･････････････････････････････････････････････････････････････ 5(3) Changes in Accounting Policies and Estimates, and Restatement of Revisions････････････････ 5

3. Quarterly Consolidated Financial Statements･･････････････････････････････････････････ 7(1) Consolidated Balance Sheets ･･････････････････････････････････････････････････････ 7(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income ･･･ 9
Consolidated Statements of Income
First quarter consolidated cumulative accounting period･･････････････････････････････ 9
Consolidated Statements of Comprehensive Income
First quarter consolidated cumulative accounting period･････････････････････････････ 10(3) Notes to Quarterly Consolidated Financial Statements･････････････････････････････････ 11(Note Concerning Going Concern Assumption) ･･････････････････････････････････････ 11(Note Concerning Significant Changes in Shareholders’ Equity)･･････････････････････････ 11(Segment Information)･･･････････････････････････････････････････････････････････ 11

1

1. Qualitative Information Concerning Quarterly Financial Statements(1) Description of Business Results
In the first quarter of the year ending March 31, 2015, the outlook for the global
economy remained uncertain, despite an ongoing recovery in the U.S. economy. Thisoutlook mainly reflected slower growth in emerging economies such as China andSoutheast Asian nations. Meanwhile, the Japanese economy followed a moderate
recovery path, despite signs of a downturn in demand following a rush to purchaseahead of the consumption tax hike in April 2014.
Business conditions were challenging for the Nitta Gelatin Group, for this meant
increased overseas prices of raw materials, while energy costs rose in Japan and the costof import procurements remained high due to the yen's depreciation.
Sales in the Japanese and overseas markets both showed sluggish growth. As a result,in the first quarter of the fiscal year ending March 31, 2015, net sales increased 0.3%
year on year to ¥8,016 million. Due to delays in transferring higher manufacturing costs
to sales prices in the Japanese market and reduced sales prices for certain products inoverseas markets, operating income fell 46.8% to ¥240 million, ordinary income wasdown 61.0% to ¥219 million and net income decreased 57.8% to ¥158 million.
Segment business performance was as follows:(a) Collagen Material BusinessIn the gelatin field, sales of edible gelatin and gelatin for capsules increased in Japan,
but earnings decreased as negotiations on price revisions ran into difficulties. In North
America, sales grew steadily, but earnings decreased due to higher raw material prices
for pig skin. Consequently, gelatin sales increased, but earnings declined.
Collagen peptide sales decreased year on year mainly reflecting stagnating sales inJapan in the wake of a rush in demand ahead of the consumption tax hike in April 2014,
along with lackluster sales in the Asian market.
Collagen casing sales decreased, due to soft sales in North America as well as weaksales in Europe and China.
As a result, net sales in the segment were up 1.8% year on year to ¥5,375 million andsegment profit (operating income) was down 27.7% to ¥321 million.

2

(b) Formula Solution Business
Sales of food materials decreased on lackluster trends in ingredients for confectionary
and desserts, and for ham and sausages.
In adhesives, overall sales were soft despite steady growth in sales of hot-meltadhesives. The soft sales reflected delays in the start of deliveries of sealants(high-performance gaskets).
As a result, net sales in the segment were down 2.7% year on year to ¥2,641 million.
Segment profit (operating income) was down 22.4% to ¥259 million.

(2) Description of Financial Position(Assets)
Total assets amounted to ¥31,084 million at June 30, 2014, ¥305 million lower than at
March 31, 2014. This was mainly attributable to a ¥1,450 million decrease in notes andaccounts receivable-trade owing to the securitization of receivables. This decrease waspartly offset by a ¥503 million increase in property, plant and equipment in line with theconstruction of a collagen peptide plant, a ¥497 million increase in inventories including
merchandise and finished goods, and a ¥101 million increase in investment securities.
(Liabilities)
Total liabilities stood at ¥16,881 million at June 30, 2014, ¥726 million lower than at
March 31, 2014. This was due mainly to a ¥500 million decrease in long-term loans
payable (current portion included) and a ¥273 million decrease in net defined benefit
liability in line with a change in accounting standards. That decrease was partly offset
by a ¥228 million increase in notes and accounts payable-trade and a ¥135 million
increase in provision for bonuses.
(Net assets)
Net assets increased ¥421 million to ¥14,202 million. This was mainly attributable to a¥347 million increase in retained earnings in line with a change in accounting standards
and an ¥89 million increase in valuation difference on other available-for-sale securities.
As a result, the equity ratio stood at 45.3% as of June 30, 2014, compared to 43.4% at
March 31, 2014.

3

(3) Description of Consolidated Business Forecasts and Other
Forward-looking Information
The Group has not revised its consolidated business forecasts for the fiscal year ending
March 31, 2015, which were announced in the “Consolidated Financial Results for the
Fiscal Year Ended March 31, 2014 (Japanese Accounting Standards)” on May 9, 2014.
Actual business and other results may differ substantially from projections due tovarious factors.

4

2. Matters Concerning Summary Information (Notes)(1) Significant Changes in Subsidiaries During the Quarterly Period Under
Review
None(2) Application of Special Accounting Methods in the Preparation of
Quarterly Consolidated Financial Statements
None(3) Changes in Accounting Policies and Estimates, and Restatement ofRevisions(Changes in Accounting Policies)(Application of Accounting Standard for Retirement Benefits, etc.)
With regard to Accounting Standard for Retirement Benefits (Accounting Standards
Board of Japan (ASBJ) Statement No. 26, May 17, 2012; the “Retirement Benefit
Accounting Standard”) and Guidance on Accounting Standard for Retirement Benefits(ASBJ Guidance No. 25, May 17, 2012; the “Retirement Benefit Accounting
Guidance”), the Company has adopted the stipulations of the body text of Article 35 of
the Retirement Benefit Accounting Standard and the body text of Article 67 of the
Retirement Benefit Accounting Guidance from the first quarter ended June 30, 2014. As
a result, the Company revised its calculation method of retirement benefit obligations
and service costs, and changed its method for attributing estimated retirement benefits
to accounting periods from the straight-line method to the benefit formula method. At
the same time, the method for determining the discount rate was changed to apply asingle weighted-average discount rate reflecting the estimated period of benefit
payments and amounts to be paid in each period. Formerly, this discount rate was basedon a close approximation of the number of years the Company's employees had on
average until retirement.
In accordance with the transitional treatment stipulated by Article 37 of the
Retirement Benefit Accounting Standard, as of April 1, 2014, the amounts that
correspond to the effect of the change in the calculation method of retirement benefit
obligations and service costs were added to, or deducted from, the starting balance ofretained earnings for the first quarter ended June 30, 2014.
As a result, the Company marked up the starting balance of net defined benefit asset5

by ¥225 million (included in “other” under investments and other assets), marked down
net defined benefit liability by ¥238 million, and marked up retained earnings by ¥299
million, in the first quarter ended June 30, 2014.
This change will have only a negligible impact on operating income, ordinary income
and income before income taxes and minority interests for the first quarter of the year
ending March 31, 2015.

6

3. Quarterly Consolidated Financial Statements(1) Consolidated Balance Sheets(Thousands of yen)

Fiscal 2014
(As of March 31, 2014)

1Q Fiscal 2015
(As of June 30, 2014)

2,426,006
8,164,776
4,732,050
1,089,542
1,820,812
465,533(13,339)
18,685,381

2,480,596
6,714,771
5,342,780
1,026,782
1,770,624
448,911(11,955)
17,772,511

2,815,141
2,139,301
3,849,844
8,804,286

2,764,555
2,036,954
4,506,082
9,307,592

50,79550,79550,66750,667

3,075,772
775,527(2,111)
3,849,189
12,704,270
31,389,652

3,177,768
778,030(2,101)
3,953,698
13,311,957
31,084,469

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
Other
Total intangible assets
Investments and other assets
Investment securities
Other
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets7

(Thousands of yen)

Fiscal 2014
(As of March 31, 2014)

1Q Fiscal 2015
(As of June 30, 2014)

4,255,505
1,121,491
1,932,912
147,730
177,916
2,444,825
10,080,381

4,483,515
1,133,478
1,904,583
13,125313,024
2,302,084
10,149,812

4,415,868
37,072
2,524,417
550,869
7,528,227
17,608,608

3,943,280
37,0722,251,168
500,319
6,731,839
16,881,652

3,144,929
2,966,442
8,623,463(68)
14,734,766

3,144,929
2,966,442
8,971,047(68)
15,082,350

622,837

712,654(5,110)(187,061)

2,316(235,621)(1,528,458)(1,480,419)(1,097,792)(1,001,070)

144,069
13,781,043
31,389,652

121,536
14,202,816
31,084,469

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
Provision for directors' retirement benefits
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(loss)
Valuation difference on otheravailable-for-sale securities
Deferred gains (losses) on hedges
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total accumulated other comprehensive
income (loss)
Minority interests
Total net assets
Total liabilities and net assets8(2) Consolidated Statements of Income and Consolidated Statements ofComprehensive Income
Consolidated Statements of Income(First quarter consolidated cumulative accounting period)(Thousands of yen)

1Q Fiscal 2014
(From April 1, 2013
to June 30, 2013)
7,992,993
6,229,307

1Q Fiscal 2015
(From April 1, 2014
to June 30, 2014)
8,016,422
6,417,022

Gross profit on sales

1,763,686

1,599,400

Selling, general and administrative expenses

Net sales
Cost of sales

1,311,740

1,358,881

Operating income

451,945

240,519

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

198
9,278
64,58453,621
25,13870
11,829Total non-operating income

152,82053,75535,103－
7,027

33,48937,092
4,243

42,131

74,825562,635

219,449

8,454
8,454

2,995
2,995

554,180

216,453

179,793374,386(1,578)375,964

60,675
155,777(2,975)
158,753

Non-operating expenses
Interest expenses
Foreign exchange losses
Other
Total non-operating expenses
Ordinary income
Extraordinary losses
Loss on retirement of noncurrent assets
Total extraordinary losses
Income before income taxes and minority
interests
Income taxes
Income before minority interests
Minority interests in loss
Net income

9－24,184
17,671

Consolidated Statements of Comprehensive Income(First quarter consolidated cumulative accounting period)(Thousands of yen)

Income before minority interests

1Q Fiscal 2014
(From April 1, 2013
to June 30, 2013)
374,386

1Q Fiscal 2015
(From April 1, 2014
to June 30, 2014)
155,777

76,80789,981(12,754)3,953

212,790(15,880)(60,401)－－

48,530(59,910)(32,558)

156,530
530,917

94,025249,803525,270
5,647

255,476(5,673)

Other comprehensive income (loss)
Valuation difference on otheravailable-for-sale securities
Deferred gains (losses) on hedges
Foreign currency translation adjustments
Pension liability adjustment of foreignsubsidiaries
Remeasurements of defined benefit plans, netof taxShare of other comprehensive loss of
associates accounted for using equity method
Total other comprehensive income (loss)
Total comprehensive income
Comprehensive income attributable to:
Owners of the parent
Minority interests10(3) Notes to Quarterly Consolidated Financial Statements(Note Concerning Going Concern Assumption)
None(Note Concerning Significant Changes in Shareholders’ Equity)
None(Segment Information)
I. First three months of the fiscal year ended March 31, 2014 (From April 1, 2013 toJune 30, 2013)
1. Information on net sales, income and loss by reporting segment
Reporting segment

Net sales
Sales to third parties
Inter-segment sales
and transfers
Total
Segment income(Thousands of yen)Amounts intheAdjustments*1 consolidated
financialstatements*2

Collagenmaterial
business

Formulasolutionbusiness

Total

5,279,632

2,713,360

7,992,993－

7,992,993

329,131－

329,131(329,131)－

5,608,763
444,927

2,713,360
334,641

8,322,124
779,569(329,131)(327,623)

7,992,993
451,945(Notes) 1. Adjustment for segment income of -¥327,623 thousand comprises
elimination of intersegment transactions of ¥525 thousand and unallocatedexpenses of -¥328,149 thousand.
2. Segment income is adjusted against the operating income recorded in the
consolidated income statement.
2. Information on impairment loss on noncurrent assets and goodwill by reporting
segments
No items to report11II. First three months of the fiscal year ended March 31, 2015 (From April 1, 2014 toJune 30, 2014)
1. Information on net sales, income and loss by reporting segment
Reporting segment

Net sales
Sales to third parties
Inter-segment sales
and transfers
Total
Segment income(Thousands of yen)Amounts intheAdjustments*1 consolidated
financialstatements*2

Collagenmaterial
business

Formulasolutionbusiness

Total

5,375,223

2,641,198

8,016,422－

8,016,422

346,330－

346,330(346,330)－

5,721,554
321,8092,641,198
259,692

8,362,753
581,501(346,330)(340,982)

8,016,422
240,519(Notes) 1. Adjustment for segment income of -¥340,982 thousand comprises

2.

elimination of intersegment transactions of ¥126 thousand and unallocatedexpenses of -¥341,108 thousand.
Segment income is adjusted against the operating income recorded in the
consolidated income statement.

2. Information on impairment loss on noncurrent assets and goodwill by reporting
segments
No items to report12