Note: This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy
between this translated document and the Japanese original, the original shall prevail.

February 3, 2023

Consolidated Financial Results
for the Third Quarter of the Term Ending March 31, 2023
(Under Japanese GAAP)
Company name: TSUMURA & CO.
Listing:
Tokyo Stock Exchange
Securities code:
4540
URL:
https://www.tsumura.co.jp
Representative:
Terukazu Kato, President Representative Director and CEO
Inquiries:
Ritsuko Inukai, Head of Corporate Communications Dept.
Telephone:+81-3-6361-7100
Scheduled date to file quarterly securities report: February 6, 2023
Scheduled date to commence dividend payments: Preparation of supplementary material on quarterly financial results: Yes
Holding of financial results briefing: Yes (for institutional investors and securities analysts)(Yen amounts are rounded down to millions, unless otherwise noted.)

1. Consolidated business results for the Third quarter of the term ending March 31, 2023 (from April 1,
2022 to December 31, 2022)(1) Consolidated operating results(Percentages indicate year-on-year changes.)

Net sales
Nine-month period
endedOperating profit

Millions of yen

Profit attributable toowners of parent

Ordinary profit%

Millions of yen%

Millions of yen%

Millions of yen%

December 31, 2022

107,076

8.8

17,723(5.9)

21,4101.6

15,875

3.2

December 31, 2021

98,382

11.2

18,8299.2

21,07418.3

15,38916.4

Note: Comprehensive income

Nine-month period ended December 31, 2022:
Nine-month period ended December 31, 2021:

Basic earnings
per share
Nine-month period
ended¥27,161 million¥21,280 million[ 27.6 %][ 71.8 %]Diluted earnings
per share
Yen

Yen

December 31, 2022

207.65－

December 31, 2021

201.15－(2) Consolidated financial condition
Total assets
As of

Net assets
Millions of yen%

December 31, 2022

400,958

279,682

64.3

March 31, 2022

350,981258,109

68.3

Reference:

Millions of yen

Equity-to-asset ratio

EquityAs of December 31, 2022:
As of March 31, 2022:¥257,773 million¥239,770 million

2. Dividends
Annual dividends per shareFirst quarter-end

Second quarter-end

Third quarter-end

Yen

Yen

Yen
Fiscal year ended
March 31, 2022
Fiscal year ending
March 31, 2023

－

32.00

－

－

32.00

－

Fiscal year-end

Fiscal year ending
March 31, 2023
(Forecast)

Total

Yen

Yen

32.00

64.00

32.00

64.00

Note: Revisions to dividends projection published most recently: No
3. Projections of consolidated business results for the term ending March 31, 2023
(From April 1, 2022 to March 31, 2023)
Net sales
Million yen

Full-year

138,500(Figures in percentage show the rate of increase or decrease from the previous fiscal year)
Profit attributable toOperating profit
Ordinary profit
Profit per shareowners of parent%

6.9

Million yen

20,800% Million yen

(7.0)

%

Million yen

21,200 (18.2)

15,000Note: Revisions to projections of consolidated business results published most recently: No%(20.4)

Yen

196.06

* Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in the change
in scope of consolidation): None
(2) Adoption of accounting treatment specific to the preparation of quarterly consolidated financial statements: Yes
Note: For details, see “2. Quarterly Consolidated Financial Statements and Key Notes (4) Notes to the Quarterly
Consolidated Financial Statements (application of specific accounting treatment to the preparation of quarterly
financial statements)” on page 10 of the material attached hereto.
(3) Changes in accounting policies, changes in accounting estimates, and restatement(i) Changes in accounting policies due to revisions to accounting standards and other regulations: None(ii) Changes in accounting policies due to other reasons: None(iii) Changes in accounting estimates: None(iv) Restatement: None
(4) Number of issued shares (common shares)(i)

Total number of issued shares at the end of the period (including treasury shares)
As of December 31, 2022

76,758,362 shares

As of March 31, 2022

76,758,362 shares(ii) Number of treasury shares at the end of the period
As of December 31, 2022

367,282 shares

As of March 31, 2022

251,343 shares(iii) Average number of shares outstanding during the period
Nine-month period ended December 31, 2022

76,451,360 shares

Nine-month period ended December 31, 2021

76,507,636 shares

Note: At the beginning of the consolidated fiscal year under review, the Company introduced the Board Incentive
Plan Trust. As a result, the shares of the Company’s stock held by the trust are included in treasury shares that are
deducted in calculating the number of treasury shares at the end of the period and the average number of shares
outstanding during the period.
* This Consolidated Financial Results is not subject to audit procedures performed by a certified public
accountant or audit corporation.

*Explanation about the proper use of financial projections and other important notes(Note about forward-looking information)
Forward-looking statements such as financial projections, which are stated in this document, are based on
information currently available to the Company and certain assumptions deemed reasonable. There is apossibility that actual results, etc. will differ materially from forecasts due to various factors. Please see “1.
Qualitative information on quarterly results (3) Description of projections of consolidated business results” onpage 4 for information regarding the forecast of consolidated financial results.

○Contents of accompanying materials
1. Qualitative information on quarterly results ·····························································································

2(1) Description of operating results ········································································································

2(2) Description of financial condition ·····································································································

3(3) Description of projections of consolidated business results ········································································

4

2. Quarterly Consolidated Financial Statements and Key Notes ··········································································

5(1) Quarterly Consolidated Balance Sheets ·······························································································

5(2) Quarterly Consolidated Statements of Income and Consolidated Statements of Comprehensive Income ···················

7

Quarterly Consolidated Statements of Income
For the Third Quarter Consolidated Accumulative Term ·········································································

7

Quarterly Consolidated Statements of Comprehensive Income
For the Third Quarter Consolidated Accumulative Term ·········································································

8(3) Quarterly Consolidated Statements of Cash Flows ·················································································

9(4) Notes to the Consolidated Financial Statements ····················································································

10(Notes on premise of a going concern) ······························································································

10(Notes on case of extreme change in shareholder's equity amount) ····························································

10(Application of specific accounting treatment to the preparation of quarterly financial statements) ······················

101

1. Qualitative information on quarterly results(1) Description of operating results
Consolidated business results for third quarter under review were as follows:[Consolidated business results]
FY 3/2022 3Q(Million yen)
YoY Change
Percent Change

FY 3/2023 3Q
98,382

107,076+8,694+8.8％

Domestic sales

91,317

96,346+5,029+5.5％

Overseas sales

7,065

10,729+3,664+51.9％

Cost of sales

47,99754,517+6,519+13.6％

Selling, general andadministrative expenses

31,554

34,836+3,281+10.4％

Operating profit

18,82917,723(1,106)(5.9)％

Ordinary profit

21,074

21,410+335+1.6％Profit attributable to owners ofparent15,38915,875+486+3.2％

Net sales

Net sales increased 8.8% year on year, to 107,076 million yen.
Domestic net sales increased 5.5% year on year, to 96,346 million yen. Sales for 129 prescription Kampo products increased 5.3%
year on year. This was attributable to enhanced activities associated with e-promotions as well as growth in prescription for products totreat symptoms (fever, cough, etc.) and aftereffects (cough, sense of fatigue, anxiety, etc.) associated with the COVID-19 infection,and seasonal symptoms due to the extreme heat (loss of appetite, losing weight in the summer, etc.) in July and August. Total sales ofdrug fostering formulations*1 grew 1.0% and sales of Daikenchuto, a mainstay item for the Company, increased 2.0% year on year.
Total sales of growing formulations*2 rose 10.6% year on year.
Sales of“Drug fostering” program formulations and“Growing” formulations (unit: millions of yen)
Rankingin salesNo. / Product Name

FY 3/2022

FY 3/2023

YoY Change/

3Q

3Q

Percent Change

1100

Daikenchuto

7,334

7,482

＋147

＋2.0％

“Drug
fostering”

3

54

Yokukansan

5,678

5,687

＋9

＋0.2％

programformulations

4

43

Rikkunshito

5,548

5,644

＋96

＋1.7％

8

107

Goshajinkigan

2,687

2,633

(54)

(2.0)％

24

14

Hangeshashinto

1,052

1,078

＋26

＋2.5％

22,301

22,527

＋225

＋1.0％

Total of "Drug Fostering" Program formulations“Growing”
formulations:241

Hochuekkito

5,655

6,096

＋441

＋7.8％

5

17

Goreisan

4,111

4,821

＋710

＋17.3％

624

Kamishoyosan

3,752

3,935

＋183

＋4.9％

16

108

Ninjin`yoeito

1,488

1,624

＋135

＋9.1％

17

137

Kamikihito

1,332

1,600

＋267

＋20.1％

16,34018,078＋1,738＋10.6％

48,65051,335＋2,684＋5.5％

87,293

91,941＋4,648＋5.3％

Total of “Growing” formulations
Total of 119 prescriptions excluding “Drug fostering”
program formulations and “Growing” formulations
Total of 129 prescription Kampo products

2

In addition, sales of OTC Kampo formulations in Japan increased 18.8% year on year, to 3,358 million yen, reflecting a rise in thenumber of stores handling the products and the growth of formulations related to symptoms of COVID-19.
Overseas net sales were 10,729 million yen. Sales on crude drug platforms (of Ping An Tsumura Pharmaceutical Co., Ltd., Shenzhen
Tsumura Medicine Co., Ltd., etc.), primarily sales of crude drugs and crude drug pieces for decoction, grew.
Cost of sales increased 13.6% year on year, to 54,517 million yen, mainly reflecting the growth in net sales and surges in raw andother materials. The cost-to-sales ratio rose 2.1 percentage points year on year, to 50.9%.
Selling, general and administrative expenses increased 10.4% year on year, to 34,836 million yen. The increase mainly reflected theposting of temporary expenses for the operation of the Tianjin Plant. The SGA ratio rose 0.4 percentage points year on year, to 32.5%.
As a result, operating profit decreased 5.9% year on year, to 17,723 million yen. The operating profit margin was 16.6%, falling 2.5
percentage points from a year ago. Ordinary profit rose 1.6% year on year, to 21,410 million yen, thanks to the impact of foreignexchange gains. Profit attributable to owners of parent increased 3.2% year on year, to 15,875 million yen. This mainly reflects theposting of extraordinary income at 463 million yen as a gain on refund resulting from a paid-in capital decrease of Sichuan Chuancun
Traditional Chinese Medicines Co Ltd., which was an equity method affiliate.
*1 “Drug fostering” program formulations:
Formulations the Company is addressing by looking hard at the structure of diseases in recent years, targeting diseases that are difficult
to treat with new drugs for which prescription Kampo preparations prove specifically effective in domains where demand for medical
treatment is high, and calling the establishment of evidence “drug fostering”*2“Growing” formulations:
Growth drivers aimed at registration in clinical practice guidelines as strategic formulations after five drug fostering program
formulations by constructing evidence (such as data on safety and effectiveness) in domains where the degree of satisfaction with medical
treatment and the degree of drug contribution are low[Impact of the COVID-19 infection, etc. on future business results]
In the first nine months of the fiscal year under review, orders received were significantly greater than initially anticipated, due to aresurgence of COVID-19, extreme heat and other seasonal factors in July and August. Given the potential for a shortage of stock,
depending on future trends in the supply/demand situation, the Company is limiting shipments for certain prescriptions. Although theCompany believes that all of these prescriptions will continue to be available to patients who have been taking them, the Company
may not be able to completely respond to demand in the case of a simultaneous epidemic of seasonal influenza and a resurgence of
COVID-19, among others. The Company will decide when to stop limiting shipments in light of the production plan and demand
trends. At present, the Company expects to stop limiting shipments, one by one, starting from the end of March. The Company willbring all employees together in a unified effort to develop and maintain its production system to ensure a stable supply ofprescriptions.
In consideration of the above circumstances, the Company maintains its initial business results projections for the full fiscal year underreview.
(2) Description of financial condition
The financial position at the end of the third quarter under review was as follows:
Total assets at the end of the third quarter increased 49,977 million yen from the end of the previous fiscal year, to 400,958 million
yen. Current assets increased 41,542 million yen from the end of the previous fiscal year, mainly due to a rise in cash and deposits
associated with the issuance of bonds. Non-current assets increased 8,434 million yen from the end of the previous fiscal year, mainly
due to an increase in property, plant and equipment.
Total liabilities were 121,276 million yen, an increase of 28,404 million yen from the end of the previous fiscal year. Current liabilities
decreased 2,179 million yen from the end of the previous fiscal year due to a decrease in income taxes payable. Non-current liabilities
grew 30,583 million yen from the end of the previous fiscal year, mainly reflecting an increase in bonds payable.
Net assets totaled 279,682 million yen, an increase of 21,572 million yen from the end of the previous fiscal year. Shareholders’ equity
rose 10,308 million yen from the end of the previous fiscal year, mainly reflecting an increase in retained earnings. Accumulated othercomprehensive income climbed 7,693 million yen from the end of the previous fiscal year, chiefly due to an increase in foreign
currency translation adjustment. Non-controlling interests increased 3,569 million yen from the end of the previous fiscal year.
As a result, the equity ratio fell 4.0 percentage point, to 64.3%.
Cash flows in the first three quarters under review were as follows:
At the end of the first nine months of the fiscal year under review, cash provided by operating activities was 8,930 million yen, cashused in investing activities was 12,425 million yen, and cash provided by financing activities was 24,456 million yen.
Cash provided by operating activities was 8,930 million yen. Looking at its breakdown, a major cash inflow item was profit before
3income taxes of 21,582 million yen, while a major cash outflow item was income taxes paid of 6,174 million yen. Compared to theprevious fiscal year, cash inflow decreased 8,884 million yen.
Cash used in investing activities was 12,425 million yen. Looking at its breakdown, a major cash outflow item was the purchase ofproperty, plant and equipment of 9,724 million yen. Compared to a year ago, cash outflow rose 4,914 million yen.
Cash provided by financing activities was 24,456 million yen. This mainly reflected 29,857 million yen provided by the issuance ofbonds. Compared to the first nine months of the previous fiscal year, cash inflow increased 29,648 million yen.
As a result, cash and cash equivalents increased 26,175 million yen from the end of the previous fiscal year, to 93,711 million yen.
(3) Description of projections of consolidated business results
The projections of consolidated business results for the fiscal year ending March 31, 2023, which were published on August 3, 2022,
remain unchanged.

4

3. Quarterly Consolidated Financial Statements and Key Notes(1) Quarterly Consolidated Balance Sheets(Millions of yen)
As of March 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
Other
Accumulated depreciation
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Retirement benefit asset
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term borrowings
Income taxes payable
Other
Total current liabilities
Non-current liabilities
Bonds payable
Long-term borrowings
Retirement benefit liability
Provision for share awards for directors (and otherofficers)
Other
Total non-current liabilities
Total liabilities

5

As of December 31, 2022

67,55254,87910,247
13,614
68,88914,360(123)
229,420

93,72961,856
9,077
14,072
77,92914,453(156)
270,962

89,56396,621(96,143)
90,04092,509106,669(104,320)
94,8578,513
3,814
12,3289,215
6,215
15,431

10,184
2,842
6,165
(0)
19,192
121,561
350,981

10,430
3,164
6,111
(0)
19,706
129,995
400,958

13,676
10,313
3,271
18,61445,875

13,452
10,313
1,760
18,17043,69630,0009,377
55

60,000
9,377
61

－

83

7,563
46,99692,871

8,058
77,580121,276(Millions of yen)
As of March 31, 2022
Net assets
Shareholders' equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

6

As of December 31, 2022

30,142
13,732
182,929(682)
226,12130,142
13,739193,617(1,068)236,430

2,324
2,020
2,673
6,911
(280)
13,64818,339258,109
350,981

2,489
(130)
2,673
16,587(277)
21,342
21,909279,682
400,958

(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive Income
Quarterly Consolidated Statements of Income / For the Third Quarter Consolidated Accumulative Term

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses
Bond issuance costs
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sale of non-current assets
Gain on capital reduction with compensation ofsubsidiaries and affiliates
Total extraordinary income
Extraordinary losses
Loss on sale of non-current assets
Loss on retirement of non-current assets
Loss on COVID19
Total extraordinary losses
Profit before income taxes
Income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

Nine-month period ended
December 31, 2021
(From April 1, 2021
to December 31, 2021
98,382
47,99750,38431,554
18,829(Millions of yen)
Nine-month period ended
December 31, 2022
(From April 1, 2022
to December 31, 2022
107,076
54,51752,55934,836
17,723

331
248
1,421
410
2,411

398
264
2,906
439
4,009

141
－
25
166
21,074

169
142
10
323
21,410

24

5

－

463

24

469

0
392
－
392
20,705
5,219
15,48697
15,389

3
35
257
296
21,582
5,060
16,521646
15,875

7

Quarterly Consolidated Statements of Comprehensive Income / For the Third Quarter Consolidated Accumulative Term
(Millions of yen)
Nine-month period ended
Nine-month period ended
December 31, 2021
December 31, 2022
(From April 1, 2021
(From April 1, 2022
to December 31, 2021
to December 31, 2022
Profit15,486
16,521Other comprehensive income
Valuation difference on available-for-sale securities(1,084)165
Deferred gains or losses on hedges
194(2,150)Foreign currency translation adjustment
6,626
12,691Remeasurements of defined benefit plans, net of tax
15
2
Share of other comprehensive income of entities
41(69)
accounted for using equity method
Total other comprehensive income
5,793
10,639Comprehensive income
21,28027,161
Comprehensive income attributable toComprehensive income attributable to owners of parent
19,68023,569Comprehensive income attributable to non-controlling
1,599
3,591
interests8

(3) Quarterly Consolidated Statements of Cash Flows(Millions of yen)
Nine-month period ended
December 31, 2022
(From April 1, 2022
to December 31, 2022

Nine-month period ended
December 31, 2021
(From April 1, 2021
to December 31, 2021
Cash flows from operating activities
Profit before income taxes
Depreciation
Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts
Interest and dividend income
Interest expenses
Bond issuance costs
Loss (gain) on sale and retirement of property, plant andequipment
Gain on capital reduction with compensation ofsubsidiaries and affiliates
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Increase (decrease) in trade payables
Decrease (increase) in retirement benefit asset
Increase (decrease) in retirement benefit liability
Other, net
SubtotalInterest and dividends received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Decrease (increase) in time deposits
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
Purchase of intangible assets
Purchase of short-term and long-term investment
securities
Proceeds from sale and redemption of short-term andlong-term investment securities
Purchase of investments in capital of subsidiaries
Loan advances
Proceeds from collection of loans receivable
Other, net
Net cash provided by (used in) investing activities
Cash flows from financing activities
Repayments of short-term borrowings
Proceeds from long-term borrowings
Repayments of long-term borrowings
Proceeds from issuance of bonds
Purchase of treasury shares
Dividends paid
Dividends paid to non-controlling interests
Other, net
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

920,705
6,496
329
30
(580)
141
－

21,582
7,578
381
17
(663)
169
142

368

32

－

(463)

(5,048)(2,461)
2,193
(310)
2
2,516
24,383583(171)(6,981)
17,815(5,810)(773)(1,759)(324)
12(5,542)
14,581671(148)(6,174)
8,930

1,727
(8,407)58(295)

7(9,724)22(2,135)(14,522)(9,713)

14,514

9,705

－
(0)
1
(586)
(7,510)

(388)
(174)
175
(199)
(12,425)

(168)
9,377
(9,376)－(2)(4,887)(87)(46)(5,192)
2,289
7,402
59,66867,070－－－29,857(446)(4,889)(70)
624,456
5,213
26,17567,536
93,711

(4) Notes to the Quarterly Consolidated Financial Statements(Notes on premise of a going concern)
No relevant items.
(Notes on case of extreme change in shareholder's equity amount)
No relevant items.
(Application of specific accounting treatment to the preparation of quarterly financial statements)(Deferment of cost variance)
Cost variance caused by seasonal changes in operation rates, etc. is expected to be eliminated for the most part by the end of the costaccounting period, which is, therefore, deferred as “current assets (other) or current liabilities (other).”10