Consolidated Financial Results for the Six Months Ended June 30, 2023
[Japanese GAAP]
Name of registrant:
Milbon Co., Ltd.
Code No.:4919
URL https://www.milbon.com/en/
Representative:
Ryuji Sato, President & CEO
Inquiries:
Masahiro Murai, Managing Executive Director
Scheduled filing date for quarterly report: August 10, 2023
Scheduled starting date of dividend payments: August 24, 2023
Preparation of supplementary materials on the quarterly results: Yes
Holding of an explanatory meeting on the quarterly results: Yes (For institutional investors and analysts)

August 10, 2023
Tokyo Stock Exchange, Prime Market
TEL: +81-3-6478-6301(Amounts of less than one million yen have been omitted.)

1. Consolidated financial results for the six months ended June 30, 2023 (January 1, 2023 - June 30, 2023)(1) Consolidated operating results
Net sales
Six months ended June 30, 2023

Operating income

Million yen
22,703%
5.8

Million yen
3,090%(19.2)

21,467

-

3,824

-

Six months ended June 30, 2022
Note: Comprehensive income

Six months ended June 30, 2023: 2,783 million yen [(28.3)%]

Six months ended June 30, 2023

Basic earnings per share Diluted earnings per share
Yen
Yen
67.48
-

Six months ended June 30, 2022

88.42

(Percentages show year-on-year changes.)
Profit attributable to ownersof parent%
Million yen%(24.4)
2,195(23.6)

Ordinary income
Million yen
3,129
4,137

23.3

2,875

19.1

Six months ended June 30, 2022: 3,883 million yen [35.0%]-

Note: Since the beginning of the previous fiscal year, sales discounts, previously categorized as non-operating expenses, are deducted from net sales. As a result, the Company
has determined that year-on-year comparisons of net sales and operating income with the same period of the previous year may be misleading. Accordingly, the percentage ofyear-on-year changes in net sales and operating income from the same period of the two fiscal years are not indicated in the above table. (Ordinary income and profit attributableto owners of parent remain unchanged.) If the figures of FY2021 were calculated on the same basis as FY2022, net sales and operating income would increase by 11.7% and15.3%, respectively, in the second quarter of FY2022. For more details, please see the FY2022 Financial Results Presentation Materials.
(2) Consolidated financial position
Total assets
Million yen
53,746

As of June 30, 2023
As of December 31, 2022
(Reference)

EquityNet assets
Million yen
45,351

52,760
As of June 30, 2023: 45,351 million yen

Equity ratio%
84.4

43,991

83.4

As of December 31, 2022: 43,991 million yen

2. Payment of dividends
Annual dividends
End of 1st quarterEnd of 2nd quarter
Yen

Year ended December 31, 2022

-

Yen
40.00

Year ending December 31, 2023

-

40.00

Year ending December 31, 2023
(forecast)
Note: Changes to latest dividends forecast: None

End of 3rd quarterEnd of fiscal year
Yen

Total

-

Yen
46.00

Yen
86.00

-

48.00

88.00

3. Consolidated operating results forecasts for the fiscal year ending December 31, 2023 (January 1, 2023 - December 31, 2023)(Percentages show year-on-year changes.)
Net sales
Million yen
Year ending December 31, 2023
48,000Note: Changes to latest performance forecast: Yes

Profit attributable toOperating income
Ordinary income
Basic earnings per shareowners of parent% Million yen% Million yen% Million yen
%
Yen
6.1
7,350
(2.7)
7,370
(5.9)
5,200
(6.8)
159.80*Notes(1) Significant changes in subsidiaries during the period(changes in specified subsidiaries resulting in the change in the scope of consolidation): NoneExclude: 0 companies (Company name: )New: 0 company (Company name: )(2) Application of accounting methods specific to the preparation of quarterly consolidated financial statements: None
(3) Changes in accounting policies, changes in accounting estimates and retrospective restatements
1) Changes in accounting policies due to amendment to theaccounting standards, etc.
: None2) Changes in accounting policies other than those in 1) above: None3) Changes in accounting estimates: None4) Retrospective restatements: None(4) Number of shares issued (common stock)1) Number of shares issued at the end of the period(including treasury shares)
2) Number of treasury shares at the end of the period
3) Average number of shares during the period

As ofJune 30, 2023
As ofJune 30, 2023
Six months ended
June 30, 2023

33,117,234 shares
577,007 shares
32,531,869 shares

As ofDecember 31, 2022
As ofDecember 31, 2022
Six months ended
June 30, 2022

33,117,234 shares
591,511 shares
32,517,278 shares*These financial statements are not subject to the review by a certified public accountant or an audit corporation.
*Explanation on the appropriate use of operating forecasts and other special instructions
Operating forecasts and other statements regarding the future presented in these materials are based on information currently available and certain
assumptions deemed to be reasonable, and actual performance may differ substantially due to various factors.

○Accompanying Materials – Contents
1. Qualitative Information on Consolidated Results for the Current Period.................................................................................

2(1)Explanation of Operating Results........................................................................................................................................

2(2)Explanation of Financial Position........................................................................................................................................

3(3)Explanation of Forward-Looking Statements Including Consolidated Operating Forecasts...............................................

3

2. Quarterly Consolidated Financial Statements and Main Notes................................................................................................

4(1)Quarterly Consolidated Balance Sheets...............................................................................................................................

4(2)Quarterly Consolidated Statements of Earnings and Quarterly Consolidated Statements of Comprehensive Income.......

6

Quarterly Consolidated Statements of Earnings
Six months ended June 30, 2022 and 2023.......................................................................................... ......................

6

Quarterly Consolidated Statements of Comprehensive Income
Six months ended June 30, 2022 and 2023......................................................................................................... .......

7(3)Quarterly Consolidated Statements of Cash Flows..............................................................................................................

8(4)Notes Regarding Quarterly Consolidated Financial Statements..........................................................................................

9(Notes regarding going concern assumption)....................................................................................................... .............

9(Notes in case of any significant changes in shareholders’ equity)...................................................................................

9(Segment Information, etc.).................................................................................................. .............................................

9(Significant subsequent events)...................................................................................................................... ...................

9

-3-

1.

Qualitative Information on Consolidated Results for the Current Period
Explanation on Operating Results(1)

In the second quarter of this fiscal year, the Japanese economy saw a moderate recovery, primarily in consumer spending.
This was spurred by the reclassification of COVID-19 as Class 5 under the Infectious Diseases Control Law, which led toincreased economic activities. However, the outlook remains uncertain due to continuing risks such as inflation due to the rapid
depreciation of the yen, the ongoing crisis in Ukraine, and concerns about an economic slowdown triggered by global monetary
tightening.
In light of this situation, our Group has been promoting the 2022-2026 Medium-Term Management Plan with the vision of“becoming the leading manufacturer in Asia and top 5 in the world by elevating the value of industry professionals in the eyesof consumers and society at large.” In FY 2023, which marks the second year of the plan, the Group will carry out key initiatives
to achieve the Beauty Platform Plan, which introduces new form of salons. This includes developing Smart Salons andlaunching the Beauty Health Care business.
Consolidated net sales for the consolidated cumulative second quarter was 22,703 million yen (a 5.8% increase year-on-year).
One of the main contributing factors was that within the hair care products category, the new Inmmetry Line launched from thePremium Brand, Aujua, has been well received for its remarkable effectiveness and contributed significantly to sales growth,and that the touchpoints of Global Milbon were steadily expanding both domestically and overseas. In terms of earnings, grossprofit margin declined due to factors such as soaring raw material prices, which continued from the first quarter. Regarding
SG&A expenses, profits were depressed by increased travel and transportation expenses, sales promotion expenses both in Japanand overseas, as sales activities such as events and seminars resumed in earnest. As a result, operating income was 3,090 million
yen (a 19.2% decrease year-on-year), ordinary income was 3,129 million yen (a 24.4% decrease year-on-year), and the quarterly
net income attributable to owners of parent was 2,195 million yen (a 23.6% decrease year-on-year).
Net sales by item and Net sales by domestic and foreign country are as follows.
[Breakdown of consolidated net sales by product category](Unit: Million yen)Six months ended June 30, 2022 Six months ended June 30, 2023
Product category
AmountRatio (%)

AmountRatio (%)

Increase(decrease)amountYear-on-yearchange (%)

Hair care products

12,21856.9

13,339

58.8

1,121

9.2

Hair coloring products

8,148

38.0

8,238

36.3

89

1.1

Permanent wave products

751

3.5

714

3.1

(37)

(4.9)

Cosmetic products

262

1.2

267

1.2

4

1.9

Other

87

0.4

144

0.6

56

65.2

21,467100.0

22,703

100.0

1,236

5.8

Total

[Breakdown of net sales into domestic and overseas sales](Unit: Million yen)Six months ended June 30, 2022
AmountSix months ended June 30, 2023

Ratio (%)

AmountRatio (%)

Increase(decrease)amountYear-on-yearchange (%)

Domestic sales

16,62777.5

17,175

75.6

547

3.3

Overseas sales

4,839

22.5

5,528

24.4

688

14.2

Total

21,467100.0

22,703

100.0

1,236

5.8

-4-

(2)

Explanation on Financial Position
Assets, liabilities and net assets①

Total assets at the end of the second quarter of the current fiscal year increased by 986 million yen from the end of theprevious fiscal year to 53,746 million yen.
Current assets decreased by 115 million yen from the end of the previous fiscal year to 26,582 million yen. The main factors
for the change were decreases of 2,253 million yen in Cash and deposits and 317 million yen in Notes and accounts receivable- trade, and increases of 1,811 million yen in Merchandise and finished goods and 474 million yen in Raw materials andsupplies.
Non-current assets increased by 1,102 million yen from the end of the previous fiscal year to 27,163 million yen.
Current liabilities decreased by 453 million yen from the end of the previous fiscal year to 7,542 million yen. The main
factors for the change were 484 million yen increase in Accounts payable - trade and 415 million yen decrease in Accounts
payable - other.
Non-current liabilities increased by 79 million yen from the end of the previous fiscal year to 852 million yen.
Net assets increased 1,360 million yen from the end of the previous fiscal year to 45,351 million yen. The main factors forthe change were increases of 690 million yen in Retained earnings and 624 million yen in Foreign currency translation
adjustment due to the depreciation of the yen.
As a result, the equity ratio changed from 83.4% at the end of the previous fiscal year to 84.4%. Net assets per share based on
the total number of shares outstanding at the end of the period were 1,393.72 yen, compared with 1,352.52 yen at the end of theprevious fiscal year.
②

Cash flows
Cash and cash equivalents ("funds") at the end of the second quarter of the current fiscal year decreased by 2,255 million

yen from the end of the previous fiscal year to 10,002 million yen.
(Cash flows from operating activities)
Net cash provided by operating activities was 694 million yen. This was mainly due to the recording of quarterly profit
before income taxes of 3,100 million yen, an increase of 1,102 million yen in Depreciation, an increase of 2,052 million yen in
inventories, and Income taxes paid of 1,261 million yen.
(Cash flows from investing activities)
Net cash used in investing activities was 1,651 million yen. This was mainly due to Purchase of property, plant andequipment of 1,199 million yen and Purchase of intangible assets of 324 million yen and Payments for guarantee deposits of
102 million yen.
(Cash flows from financing activities)
Net cash used in financing activities was 1,496 million yen. This was mainly due to dividends paid to shareholders of 1,494
million yen.
(3)

Explanation of Forward-Looking Statements Including Consolidated Operating Forecasts
With regard to the full-year earnings forecast, the previous forecast (announced on February 14, 2023) has been revised,taking into account the most recent earnings and other factors. For details, please see the " Notice of Revision to Consolidated
Operating Results Forecast" announced on August 10, 2023.

-5-

2.

Quarterly Consolidated Financial Statements and Main Notes(1)

Quarterly Consolidated Balance Sheets(Thousand yen)Previous fiscal year
As of December 31, 2022

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
Non-current assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
LandConstruction in progress
Other, net
Total property, plant and equipment
Intangible assets
Investments and other assets
Investment securities
Long-term loans receivable
Net defined benefit asset
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Accounts payable - trade
Accounts payable - other
Income taxes payable
Provision for bonuses
Other
Total current liabilities
Non-current liabilities
Net defined benefit liability
Deferred tax liabilities
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities-6-

Current 2nd quarter
As of June 30, 2023

12,300,053
5,255,686
6,319,121
39,927
1,999,103
784,924(185)
26,698,631

10,046,864
4,937,940
8,130,986
58,1152,473,640
935,388
26,582,934

9,014,115
3,082,059
6,452,228
453,754
817,742
19,819,899
1,902,217

9,270,667
3,218,293
6,459,902
813,496
958,961
20,721,320
1,906,588

1,775,734
7,425
56,180826,583
1,719,802(46,087)
4,339,639
26,061,755
52,760,387

1,700,636
53,636905,101
1,922,634(46,087)
4,535,921
27,163,830
53,746,765

1,133,259
4,022,247
1,334,496
591,582
914,619
7,996,205

1,617,639
3,606,752
1,075,906
526,299
716,192
7,542,789

10,628610
643,317
117,875
772,4318,768,636

11,265
627
694,767
145,423
852,083
8,394,873

(Thousand yen)Previous fiscal year
As of December 31, 2022
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets-7-

Current 2nd quarter
As of June 30, 2023

2,000,000
274,537
41,875,487(2,030,911)
42,119,113

2,000,000
306,922
42,565,622(1,981,618)
42,890,926

214,928
1,766,040(108,331)
1,872,637
43,991,750
52,760,387

162,8112,390,565(92,410)2,460,965
45,351,892
53,746,765

(2) Quarterly Consolidated Statements of Earnings and Consolidated Statements of Comprehensive Income
Quarterly Consolidated Statements of Earnings
Six Months Ended June 30, 2022 and 2023
(Thousand yen)Six months ended June 30, 2022 Six months ended June 30, 2023
(January 1, 2022
(January 1, 2023
- June 30, 2022)- June 30, 2023)
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Foreign exchange gains
Company house defrayment income
Gain on surrender of insurance
Subsidy income
Other
Total non-operating income
Non-operating expenses
Share of loss of entities accounted for using equity
methodOther
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Total extraordinary income
Extraordinary losses
Loss on retirement of non-current assets
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit attributable to owners of parent-8-

21,467,252
7,198,250
14,269,001
10,444,920
3,824,080

22,703,504
7,893,545
14,809,959
11,719,136
3,090,823

10,452
7,543
257,286
1,520
18,06828,68756,559380,118

8,561
8,800
38,275
1,428
11,83125,304
94,20164,51752,4892,122
66,6404,137,558

3,444
55,934
3,129,090

923
448
1,372

-

604
604
4,138,326
1,418,446(155,275)
1,263,171
2,875,154
2,875,154

29,04529,0453,100,045
974,809(70,123)
904,685
2,195,360
2,195,360

Quarterly Consolidated Statements of Comprehensive Income
Six Months Ended June 30, 2022 and 2023
(Thousand yen)Six months ended June 30, 2022 Six months ended June 30, 2023
(January 1, 2022
(January 1, 2023
- June 30, 2022)- June 30, 2023)
ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners ofparentComprehensive income attributable to non-controllinginterests-9-2,875,154

2,195,360(59,934)(68,821)
1,148,941(11,661)
1,008,524
3,883,679(52,117)624,525
15,920588,327
2,783,688

3,883,679

2,783,688

-

-

(3)

Quarterly Consolidated Statements of Cash Flows(Thousand yen)Six months ended June 30, 2022 Six months ended June 30, 2023
(January 1, 2022
(January 1, 2023
- June 30, 2022)- June 30, 2023)

Cash flows from operating activities
Profit before income taxes
Depreciation
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Decrease (increase) in net defined benefit asset
Interest and dividend income
Share of (profit) loss of entities accounted for using
equity method
Interest expenses
Foreign exchange losses (gains)
Loss (gain) on sales of investment securities
Loss (gain) on sales of non-current assets
Loss on retirement of non-current assets
Decrease (increase) in notes and accounts receivable trade
Decrease (increase) in inventory
Increase (decrease) in notes and accounts payable trade
Other
SubtotalInterest and dividend income received
Income taxes paid
Cash flows from operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Payments of loans receivableCollection of loans receivable
Purchase of investment securities
Proceeds from sales of investment securities
Payments for guarantee deposits
Proceeds from collection of guarantee deposits
Other
Cash flows from investing activities
Net cash provided by (used in) financing activities
Net decrease (increase) in treasury shares
Cash dividends paid
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period- 10 -

4,138,326
1,014,981(3,995)(9,376)(18,584)(17,995)

3,100,045
1,102,221(191)(69,309)25,484(17,362)

64,51752,489(198)(60,592)
(448)
(923)
604

(66,423)
29,045(261,967)

345,513(2,202,624)(2,052,173)

595,929434,804(749,068)
2,488,583
17,426(1,304,328)
1,201,680(946,811)
1,937,332
18,343(1,261,491)
694,184(811,174)
977(393,579)
1,755(12,681)546(148,947)
43,258(3,146)(1,322,990)(1,199,276)(324,970)(34,300)
5,535(102,595)
15,267(11,281)(1,651,620)(696)(1,233,982)(1,234,679)(1,161)(1,494,854)(1,496,015)

508,609

197,729(847,379)
13,312,634
12,465,255(2,255,721)
12,258,237
10,002,515

(4) Notes Regarding Quarterly Consolidated Financial Statements(Notes regarding going concern assumption)
None(Notes in case of any significant changes in shareholders' equity)
None(Segment information, etc.)
This information is omitted since the Group has a single segment of manufacture and sales of cosmetic products(Significant subsequent events)
None- 11 -