TSUMURA & CO.
First Quarter Business Resultsfor Fiscal 2019
(From April 1, 2019 to June 30, 2019)

August 2, 2019

Roadmap to Realizing Our Long-Term Vision2018 20192021 2022
Becoming a value-creation company
that contributes to people’s healththrough its Kampo business

Third medium-term
management plan

Growthinvestments

Consolidated Sales
Over135billion yen

Rapidprogress

Overseas
sales ratio
Over50％

Domestic Business

Sustainably expanding
the Kampo market
Consolidated Sales

120.9billion yen

Building the foundation
for the Chinese business●Establishing a Kampo
medicine business
Having one in every two doctors
writing over 10 Kampo prescriptions

Chinese Business●Contributing to thehealth of China’s citizens
Aiming to become a number one
Chinese medicine company-Becoming the most trusted Chinese
medicine company in China-2

1Q Consolidated Performance for Fiscal 2019（¥ million）
FY 2018
1Q

FY 2019
1Q

Vs. FY 2018 1Q
AmountChange

Net sales

29,77630,699+923+3.1％

Operating profit

4,559

5,230+671+14.7％

Operating profit
margin

15.3％

17.0％

－－Ordinary profit

4,917

5,401+483+9.8％

Profit attributable toowners of parent3,516

3,903+386+11.0％

3

Key Points in Performance
1Q Results, Sales and profit growth year-on-year
Consolidated net sales¥30,699 million

YoY+3.1％

 Net sales rose ¥923 million or 3.1% owing mainly to a 3.3% growth in sales of prescription Kampo
products.

Operating profit

Operating profit margin¥5,230 million
17.0 ％

YoY+14.7％

YoY+1.7pt

 The cost of sales ratio was 40.5%, down 1.2pt year-on-year thanks to a reduction in crude drug-relatedcosts.
 The SG&A ratio was 42.5%, down 0.5pt thanks to an increase of net sales.

Ordinary profit¥5,401 million

YoY+9.8％

Profit attributable toowners of parent¥3,903 million

YoY+11.0％
4Factors in Increase / Decrease of Operating Profit（¥ million）

+923

(2)

(249)

（¥ million）

Factors of Sales increase

5,230

4,559

Prescription Kampo 129 products+954

Other(31)

Factors of Cost of sales margin

Cost of sales margin
41.7%→40.5%(1.2)pt

Crude drug cost(0.9)pt

Raw material cost

+0.1ptProcessing cost(0.2)pt

Other(0.2)pt

Factors of SG&A expenses

FY 2018
1Q
Operatingprofit

Sales
Sales cost
increase increase

SG&A
expenses
increase

FY 2019
1Q
OperatingprofitSales promotion expenses+99

R&D expenses+145

Advertising expenses(67)

Personnel expenses+91

Other(20)5Financial Condition / Cash Flow Position
Balance Sheet（¥ million）
As of March2019

Total assets
Current assets
Non-current assets

Total liabilities
Current liabilities
Non-current liabilities

Total net assets
Equity Ratio

As ofJune

Cash Flow Position

Change2019

287,322

288,459

1,136190,027
97,295
81,18133,32047,861
206,141

191,644
96,814
81,97235,702
46,269206,486

1,617
(480)
791
2,382
(1,591)
345

70.2%

70.0%

(0.2)pt

Investing Financing
Operating Activities Activities
Activities
+6.9
(2.3)
+4.8

（ ¥ billion）

Effect ofexchange
rate
Changes
+0.4

66.1

56.2

（¥ million）
Balance Sheet

As of March2019

As ofJune2019

Change51,80855,111（Merchandise andfinishedgoods）

9,382

8,210

(1,172)（Work in process）

11,125

12,854

1,728（Raw materials
and stores ）31,29934,046

2,747

Inventories3,302 Cash and cash
equivalents at
beginning ofperiod

Cash and cash
equivalents at endof period

6

Sales performance of prescription Kampo products （¥ million）
Drug-fosteringformulations

Salesrank

Product No. / name

FY 2018 1Q

FY 2019 1Q

YoY Change

1100

Daikenchuto

2,704

2,662(41)(1.5)%

254

Yokukansan

1,956

1,995

39

2.0%

343

Rikkunshito

1,783

1,872

89

5.0%

9107

Goshajinkigan

926

936

101.1%

22

14

Hangeshashinto

345

364

18

5.4%

Total sales of the five Drug-fosteringformulations

7,715

7,831

116

1.5%41Hochuekkito

1,766

1,761(5)(0.3)%

568

Shakuyakukanzoto

1,310

1,340

292.3%

629

Bakumondoto

1,091

1,188

978.9%

724

Kamishoyosan

1,155

1,165

100.9%

817

Goreisan

1,020

1,118

98

9.7%

Total sales of the five Growing formulations

6,344

6,574

230

3.6%

Total of 129 prescription Kampo products

28,52629,480954

3.3%

Growing
formulations

4

Growth rate of 129 prescription Kampo formulations
Amount base
Number of itemswith higher yen sales

FY 2014

FY 2015

FY 2016

FY 2017

ＦＹ2018

ＦＹ 2019 1Q

2.4%

2.3%

1.9%

2.4%

2.7％

3.3%

8168956383

807

TSUMURA & CO.

Investor Relations Group
Corporate Communications Dept.

Cautionary items regarding forecasts• The materials and information provided in this presentation contain so-called forward-looking
statements. Readers should be aware that realization of these statements can be affected by a varietyof risks and uncertainties and that actual results could differ significantly.
• Changes in the healthcare insurance systems or regulations set by medical treatment authorities on
drug prices or other aspects of healthcare or in interest and foreign exchange rates could impact
negatively on the Company’s performance or financial position.
• In the unlikely event that sales of the Company’s core products were halted or declined substantially
due to a defect, unforeseen side effect or some other factor, it would have a major impact on theCompany’s performance or financial position.