Flash Report for 2nd quarter Ended June 30, 2022
(on a consolidated basis) [Japan GAAP]
August 9, 2022
Name: Nakanishi Inc.

Stock listing: Tokyo Stock Exchange : Standard Market

Code Number: 7716

URL: http://www.nsk-nakanishi.co.jp

Representative: Eiichi Nakanishi, President and Group CEO
Inquiries: Daisuke Suzuki, Corporate Vice President, Finance & Accounting

Tel: +81-289-64-3380

Scheduled date to submit Securities Report: August 10, 2022
Scheduled date to begin dividend payments: September 30, 2022
Supplementary materials to quarterly financial statements: Not applicable
Quarterly earnings results briefing: Applicable (for institutional investors and securities analysts)(All amounts are rounded down to the nearest million yen.)
1. Consolidated financial results for 1st quarter period (January 1 to June 30, 2022)(1) Operating Results
Millions of yen
Operating income

Ordinary income

2nd quarter ended June 30, 2022

24,462

Net sales
6.3%

8,129

6.3%

9,490

27.8%

2nd quarter ended June 30, 2021

23,014

68.1%

7,646

219.6%

7,423

198.1%

Incomeattributable toowners of parent

Earnings per share(yen)

Diluted EPS (yen)

2nd quarter ended June 30, 2022

6,750

25.8%

78.52

78.33

2nd quarter ended June 30, 2021

5,366

188.7%

61.93

61.80

Notes:

1.

Percentage figures for net sales, operating income, ordinary income and net income represent
year-on-year comparisons.

2.

Comprehensive income for reporting period:
2nd quarter ended June 30, 2022

9,000 million (45.4%)

2nd quarter ended June 30, 2021

6,191 million (366.0%)(2) Financial Position
Millions of yen
Total assets

Net assets

Equity ratio

As of June 30, 2022

98,914

89,165

89.9%

As of December 31, 2021

94,46082,91987.5%

Note: Ownersʼ equity As of June 30, 2022
As of December 31, 2021

88,880 million
82,683 million－ 1 －2. Dividends
Cash dividends per share (yen)
1st quarter2nd quarter 3rd quarter

Year ended December 31, 2021

̶

17.00

Year ending December 31, 2022

̶

22.00

Year-end

Annual

̶

20.00

37.00

̶

22.00

44.00

Year ending December 31, 2022
(forecast)
Notes:

1.

Revisions to dividend payment forecasts during the period: Applicable

3. Business Performance Forecasts for the Current Term (January 1 to December 31, 2022)
Millions of yen
IncomeNet sales
Full year

45,788Notes:

2.1%

Operatingattributable toincomeOrdinary income owners of parent

12,606-8.3% 13,587

-2.6%

9,621

1.

Percentage figures represent year-on-year comparisons.

2.

Revisions to performance forecasts during the period: Not applicable

Earnings per-4.8%

share (yen)111.66

4. Others(1) Changes in the scope of consolidation during the period
Inclusion: None
Exclusion: None
(2) Application of special accounting methods in the preparation of quarterly consolidated financial
statements: Not applicable(3) Changes in accounting principles, accounting estimates, and restatement
1. Changes in accounting principles due to revision of accounting standards, etc.: Applicable
2. Changes in accounting principles other than 1: Not applicable
3. Changes in accounting estimates: Not applicable
4. Restatement: Not applicable(4) Number of ordinary shares outstanding at the end of the period (including treasury stock)
As of June 30, 2022:

94,259,400 shares

As of December 31, 2021:

94,259,400 shares

Number of shares of treasury stock at the end of the period
As of June 30, 2022:

8,573,808 shares

As of December 31, 2021:

8,094,386 shares

Average number of shares during the period
2nd quarter ended June 30, 2022: 85,980,048 shares
2nd quarter ended June 30, 2021: 86,656,728 shares* This quarterly flash report is out of scope of quarterly review.

－ 2 －Table of Contents
1. Qualitative Information on Quarterly Financial Results

4(1) Explanation of Results of Operations

4(2) Explanation of Financial Position

4(3) Explanation of Cash flows

5(4) Explanation of Forecast of Consolidated Financial Results and Other Forward-Looking
Information
2. Consolidated Quarterly Financial Statements and Principal Notes

56(1) Consolidated Quarterly Balance Sheets

6(2) Consolidated Quarterly Statements of Income and Comprehensive Income

8(Consolidated Quarterly Statements of Income)

8(Consolidated Quarterly Statements of Comprehensive Income)9(3) Consolidated Statements of Cash Flows

10(4) Notes to Consolidated Quarterly Financial Statements

12(Notes to Going Concern Assumption)

12(Notes to Significant Changes in the Amount of Shareholdersʼ Equity)

12(Changes in the scope of consolidation during the period)

12(Segment Information）

13

－ 3 －

1. Qualitative Information on Quarterly Financial Results(1) Explanation of Results of Operations
In the world economy during 2nd quarter, CPI has increased thanks to demand increases by prompt
economic recover after pandemic. Unease of energy supply has increased due to the Russian invasion of
Ukraine. So uncertainty for future was increasing.
In Japanese economy, economic activities were very low because raw material prices increased and to
procure components was difficult.
Under these circumstances, all 3 segments sales increased. Operating income increased as well.
As a result, the Group sales were ¥24,462,214 thousand (+6.3% year on year), operating income was¥8,129,454 thousand (+6.3%), ordinary income was \9,490,143 thousand (+27.8%) and income
attributable to owners of parent for the quarter was ¥6,750,816 thousand (+25.8%).
The following is a breakdown of business performance by segment.
By the way, our company has changed segment. About year-on-year, it is analyzed by the figures atthe changed segment.
（Dental segment）
In Dental segment, Domestic sales decreased because the reaction that clinics received subsidy fromgovernment last year and Asia sales decreased as well.
However North America sales increased dramatically and Europe sales increased as well. Total dental
sales increased. Segment profit was almost the same.
As a result, sales were \20,530,662 thousand (+3.3%) and segment profit was \8,669,769 thousand(+2.6%).
(Surgical segment)
In Surgical segment, Asia sales decreased but Domestic, North America and Europe sales increased.
Total sales increased. Segment profit increased as well.
As a result, sales were \1,681,197 thousand (+24.4%) and segment profit was \885,149 thousand(+35.2%).
（Industrial segment）
In Industrial segment, Asia sales decreased but Domestic, North America and Europe sales increased.
Total sales increased. Segment profit increased as well.
As a result, sales were \2,250,354 thousand (+25.7%) and segment profit was \774,127 thousand(+17.3%).

(2) Explanation of Financial Position(Assets, liabilities and net asset)
Total assets at the end of 2nd quarter were \98,914,335 thousand and increased by \4,453,416
thousand compared with the end of the previous fiscal year. The main reasons were that Notes andaccounts receivable - trade by \936,130 thousand, Raw materials and supplies by \926,809 thousand
and Construction in progress by ¥844,692 thousand.
Total liabilities were \9,748,950 thousand and decreased by \1,792,495 thousand compared with theend of the previous fiscal year. The main reason was Other in current liabilities decreased by¥1,747,561 thousand.
Net asset was \89,165,385 thousand and increased by \6,245,912 compared with the end of theprevious fiscal year. The main reasons were that Retained earnings increased by ¥5,027,516 thousand
and Foreign currency translation adjustment by ¥2,687,050 thousand.
－ 4 －(3) Explanation of Cash flows
The balance of cash and cash equivalents on a consolidated basis as of the end of 2nd quarter was¥33,894,220 thousand, down ¥993,595 thousand from the previous term-end.
Net cash provided by operating activities was ¥2,805,211 thousand, compared with ¥7,108,837
thousand a year earlier. The main factor here was an increase of cash due to the recording of income
before income taxes and minority interests of ¥9,522,712 thousand, which outweighed income taxes
paid of ¥2,900,252 thousand.
Net cash provided by investing activities was ¥-3,363,793 thousand, compared with ¥-626,001
thousand a year earlier. The main expenditure Purchase of shares of subsidiaries and associates¥1,568,387 thousand and were Purchase of tangible fixed assets ¥1,457,281 thousand.
Net cash provided used in financing activities was ¥-2,800,225 thousand, compared with ¥-1,300,166 thousand a year earlier. The main expenditure were Cash dividends paid ¥1,722,570
thousand and Purchase of treasury shares ¥1,077,655 thousand.
(4) Explanation of Forecast of Consolidated Financial Results and Other Forward-Looking Information
Currently we will not change the forecast announced on May 12, 2022

－ 5 －

2. Consolidated Quarterly Financial Statements and Principal Notes(1) Consolidated Quarterly Balance Sheets(Thousands of yen)
As of December 31,
2021
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Securities
Money held in trust
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
Machinery, equipment and vehicles
Tools, furniture and fixtures
Land
Construction in progress
Accumulated depreciation
Total property, plant andequipment
Intangible assets
Software
Software in progress
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Shares of subsidiaries andassociates
Insurance funds
Retirement benefit asset
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets－ 6 －As of June 30, 2022

35,984,340
5,348,771
1,422,099
4,341,163
5,822,666
3,286,853
2,623,642
1,382,650-60,452
60,151,734

35,969,202
6,284,901
1,364,868
4,280,629
5,918,559
3,763,211
3,550,451
1,719,187-78,861
62,772,150

15,431,241
7,486,174
5,205,578
2,033,155
962,539-15,825,871

15,609,974
7,819,759
5,507,859
2,130,018
1,807,231-16,672,360

15,292,817

16,202,483

377,341
320,598
108,442
538,570
1,344,953

730,320
152,078
85,098509,249
1,476,747

8,692,157

8,312,339

4,866,102

5,694,177

2,122,292－
940,349
1,051,965-1,452
17,671,414
34,309,185
94,460,919

2,132,397
2,457
1,189,233
1,133,890-1,541
18,462,954
36,142,185
98,914,335

(Thousands of yen)
As of December 31,
2021
Liabilities
Current liabilities
Accounts payable - trade
Short-term borrowings
Income taxes payable
Provision for bonuses
Other
Total current liabilities
Non-current liabilities
Retirement benefit liability
Deferred tax liabilities
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive
incomeValuation difference on available-forsale securities
Foreign currency translation
adjustment
Total accumulated othercomprehensive income
Share acquisition rights
Non-controlling interests
Total net assets
Total liabilities and net assets－ 7 －As of June 30, 2022

1,009,312
100,000
2,529,830
909,596
6,045,854
10,594,594

1,412,515
100,000
2,390,619
437,648
4,298,292
8,639,076

342,260
412,271
192,319
946,851
11,541,446

357,267
563,581
189,024
1,109,873
9,748,950

867,948
1,180,482
84,765,333-6,793,803
80,019,961

867,948
1,180,482
89,792,849-7,871,458
83,969,822

1,843,974

1,404,389

819,197

3,506,248

2,663,172

4,910,637

232,552
3,786
82,919,473
94,460,919

278,6856,241
89,165,385
98,914,335

(2) Consolidated Quarterly Statements of Income and Comprehensive Income(Consolidated Quarterly Statements of Income)(Thousands of yen)Six months ended
June 30, 2021
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Gain on investments in money held in trust
Subsidy income
Share of profit of entities accounted for using
equity method
Foreign exchange gains
Miscellaneous income
Total non-operating income
Non-operating expenses
Interest expenses
Loss on investments in money held in trust
Commission expenses
Share of loss of entities accounted for using
equity method
Foreign exchange losses
Miscellaneous losses
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sale of non-current assets
Gain on sale of investment securities
Total extraordinary income
Extraordinary losses
Loss on sale of non-current assets
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 non-controlling interests
Profit attributable to owners of parent－ 8 －Six months ended
June 30, 2022

23,014,252
9,099,992
13,914,259
6,267,598
7,646,660

24,462,214
8,978,925
15,483,288
7,353,834
8,129,454

37,01526,441
134,427
32,13335,19332,097－35,927

199,717－－
55,345
485,080

1,480,792
110,914
1,694,925

1,771
－
－

774
248,058
5,417－

58,746699,385
7,257
708,414
7,423,326－
21,239334,236
9,490,143－
17,087
17,08765,888－65,888－313
313
7,440,099
2,253,848-181,241
2,072,606
5,367,493
562
5,366,930

31,826
1,492
33,3199,522,712
2,741,843
28,7072,770,550
6,752,161
1,345
6,750,816

(Consolidated Quarterly Statements of Comprehensive Income)(Thousands of yen)Six months ended
June 30, 2021
ProfitOther comprehensive income
Valuation difference on available-for-salesecurities
Foreign currency translation adjustment
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable toowners of parent
Comprehensive income attributable tonon-controlling interests－ 9 －Six months ended
June 30, 2022

5,367,493

6,752,161-45,036-439,585

868,776
823,740
6,191,233

2,688,159
2,248,573
9,000,735

6,190,356

8,998,281

876

2,454

(3) Consolidated Statements of Cash Flows(Thousands of yen)Six months ended
June 30, 2021
Cash flows from operating activities
Profit before income taxes
Depreciation
Amortization of goodwill
Increase (decrease) in allowance for doubtful
accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in retirement benefit
liability
Interest and dividend income
Interest expenses
Share of loss (profit) of entities accounted
for using equity method
Loss (gain) on sale of investment securities
Loss on retirement of non-current assets
Loss (gain) on sale of non-current assets
Gain (gain) on investments in money held in
trust
Subsidy income
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Increase (decrease) in trade payables
Foreign exchange losses (gains)
Other, net
SubtotalInterest and dividends received
Interest paid
Income taxes paid
Subsidies received
Net cash provided by (used in) operating
activities
Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sale of property, plant andequipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from sale and redemption of
investment securities
Purchase of shares of subsidiaries andassociates
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of insurance funds
Other, net
Net cash provided by (used in) investing
activities

Six months ended
June 30, 2022

7,440,099
853,028
27,302

9,522,712
918,40727,302-24,488

12,25428,000-471,948-8,065487-63,457-67,290

1,771

774

-199,717

58,746-17,087
313
－

－
1,492
-34,061-134,427

248,058-32,133-450,832-35,927-465,159-807,590-54,308

321,737
157,058-761,239
1,800,793
8,938,655
166,918-1,802-2,027,066
32,133－ 10 －-2,605,381-720,974

5,527,595
142,747-804-2,900,252
35,927

7,108,837

2,805,211-336,255-1,457,281－

61,820-109,966-444,340-284,504－

551,101

726,707－-1,568,387-2,888,263
2,603,446-6,741
5,018-3,006,312
2,167,067-6,741
3,838-626,001-3,363,793

(Thousands of yen)Six months ended
June 30, 2021
Cash flows from financing activities
Dividends paid
Purchase of treasury shares
Net cash provided by (used in) financing
activities
Effect of exchange rate change on cash andcash equivalents
Net increase (decrease) in cash and cash
equivalents
Cash and cash equivalents at beginning of
periodCash and cash equivalents at end of period－ 11 －

Six months ended
June 30, 2022

-1,300,074-92-1,722,570-1,077,655-1,300,166-2,800,225

877,422

2,365,212

6,060,092-993,595

30,044,771

34,887,816

36,104,863

33,894,220

(4）Notes to Consolidated Quarterly Financial Statements(Notes to Going Concern Assumption)
Not applicable.
(Notes to Significant Changes in the Amount of Shareholdersʼ Equity)
Not applicable.
(Changes in the scope of consolidation during the period)
Not applicable.

－ 12 －

(Segment Information）【Segment Information】
2nd quarter ended June 30, 2021 (From January 1, 2021 to June 30, 2021)(Thousands of yen)Per

Reportable segments
DentalSurgicalIndustrial

Reportablesegment

segment

segment

segments

Reconciling
items

quarterly
consolidated financial
statements

Sales
Revenues
fromexternal

19,872,108

1,351,441

1,790,702

23,014,252－

23,014,252

－

－

－

－

－

－

19,872,108

1,351,441

1,790,702

23,014,252－

23,014,252

8,452,160

654,795

660,201

9,767,158-2,120,497

7,646,660

customers
Transactions
with othersegments
Net sales
Operatingprofit (loss)

Notes:

1.

Adjustments to segment profit chiefly comprise general administrative and testing/researchexpenses not attributable to reportable segments.

2.

Segment profit is reconciled with operating income as recorded in the consolidated statements
of income.

－ 13 －

2nd quarter ended June 30, 2022 (From January 1, 2022 to June 30, 2022)(Thousands of yen)Per

Reportable segments
DentalSurgicalIndustrial

Reportablesegment

segment

segment

segments

Reconciling
items

quarterly
consolidated financial
statements

Sales
Revenues
fromexternal

20,530,662

1,681,197

2,250,354

24,462,214－

24,462,214

－

－

－

－

－

－

20,530,662

1,681,197

2,250,354

24,462,214－

24,462,214

8,669,769

885,149

774,127

10,329,046-2,199,591

8,129,454

customers
Transactions
with othersegments
Net sales
Operatingprofit (loss)
Notes:

1.

Adjustments to segment profit chiefly comprise general administrative and testing/researchexpenses not attributable to reportable segments.

2.

Segment profit is reconciled with operating income as recorded in the consolidated statements
of income.

Change of segment
From 1st quarter of this year, surgical segment is showing because the figures are big. Surgical segment
was included in dental segment in the past.
And other segment was divided into dental segment and industrial segment and surgical segment. The
divided figures were added to the three segments.
Furthermore, about year-on-year, it is analyzed by the figures at the changed segment.

－ 14 －