Flash Report for Fiscal year Ended December 31, 2022
(on a consolidated basis) [Japan GAAP]
February 9, 2023
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: March 30, 2023
Scheduled date to begin dividend payments: March 31, 2023
Supplementary materials to financial statements: Not available
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 Fiscal year period (January 1 to December 31, 2022)(1) Operating Results
Millions of yen
Operating income

Ordinary income

Fiscal year ended December 31, 2022

48,671

Net sales
8.5%

15,38911.9%

17,646

26.5%

Fiscal year ended December 31, 2021

44,85735.7%

13,75061.0%

13,951

61.7%

Incomeattributable toowners of parent

Earnings per share(yen)

Diluted EPS (yen)Fiscal year ended December 31, 2022

12,47123.4%

145.48145.11

Fiscal year ended December 31, 2021

10,102

56.5%

116.73116.47

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:
Fiscal year ended December 31, 2022

14,165 million (33.9%)

Fiscal year ended December 31, 2021

10,577 million (63.8%)(2) Financial Position
Millions of yen
Total assets

Net assets

Equity ratio

As of December 31, 2022

102,154

91,02288.8%

As of December 31, 2021

94,46082,91987.5%

Note: Ownersʼ equity As of December 31, 2022

90,737 million

As of December 31, 2021

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

Year-end

AnnualYear ended December 31, 2021

̶

17.00

̶

20.00

37.00

Year ending December 31, 2022

̶

22.00

̶

24.00

46.00

̶

24.00

̶

24.00

48.00

Year ending December 31, 2023
(forecast)

3. Business Performance Forecasts for the Current Term (January 1 to December 31, 2023)
Millions of yen
IncomeNet sales

Operatingattributable toincomeOrdinary income owners of parent

Earnings per
share (yen)First-half period

25,556

4.5

7,616

-6.3

7,892 -16.8

5,461 -19.1

64.14

Full year

52,272

7.4

15,070-2.1

15,836 -10.3

10,976 -12.0

128.91

Notes:

1.

Percentage figures represent year-on-year comparisons.

4. Others(1) Changes in the scope of consolidation during the period
Inclusion: 1 company, Nakanishi GmbH
Exclusion: None
(2) Application of special accounting methods in the preparation of 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 December 31, 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 December 31, 2022:

9,105,053 shares

As of December 31, 2021:

8,094,386 shares

Average number of shares during the period
Fiscal year ended December 31, 2022: 85,729,735 sharesFiscal year ended December 31, 2021: 86,546,716 shares* This flash report is out of scope of quarterly review.

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

4(1) Explanation of Results of Operations

4(2) Explanation of Financial Position

4(3) Explanation of Cash flows

5(4) Future Outlook

5

2. Consolidated Financial Statements and Principal Notes

6(1) Consolidated Balance Sheets

6(2) Consolidated Statements of Income and Comprehensive Income

8(Consolidated Statements of Income)

8(Consolidated Statements of Comprehensive Income)9(3) Consolidated Statements of Changes in Net Assets

10(4) Consolidated Statements of Cash Flows

12(5) Notes to Consolidated Financial Statements

14(Notes to Going Concern Assumption)

14(Segment Information）

15

－ 3 －

1. Qualitative Information on Financial Results(1) Explanation of Results of Operations
In the world economy during the fiscal year, 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 ¥48,671,452 thousand (+8.5% year on year), operating income was¥15,389,229 thousand (+11.9%), ordinary income was \17,646,562 thousand (+26.5%) and income
attributable to owners of parent for the quarter was ¥12,471,540 thousand (+23.4%).
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 was almost the same as last year.
However, North America sales and Europe sales increased. Total dental sales increased. Segment profit
was almost the same.
As a result, sales were \40,926,711 thousand (+7.0%) and segment profit was \17,024,344 thousand(+9.4%).
(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 \3,160,058 thousand (+14.4%) and segment profit was \1,571,575 thousand(+20.6%).
（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 \4,584,682 thousand (+19.4%) and segment profit was \1,683,337 thousand(+22.2%).
(2) Explanation of Financial Position(Assets, liabilities and net asset)
Total assets at the end of Fiscal year were \102,154,460 thousand and increased by \7,693,540
thousand compared with the end of the previous fiscal year. The main reasons were that Buildings andstructures increased by \2,680,039 thousand and Goodwill increased by \2,587,780 thousand.
Total liabilities were \11,131,804 thousand and decreased by \409,642 thousand compared with theend of the previous fiscal year. The main reason was Other in current liabilities decreased by¥1,604,109 thousand but Accounts payable - trade increased by ¥526,217 thousand.
Net asset was \91,022,656 thousand and increased by \8,103,182 thousand compared with the endof the previous fiscal year. The main reasons were that Retained earnings increased by ¥8,863,157
thousand and Treasury shares increased by ¥2,500,140 thousand.

－ 4 －(3) Explanation of Cash flows
The balance of cash and cash equivalents on a consolidated basis as of the end of the fiscal year was¥31,648,571 thousand, down ¥3,239,245 thousand from the previous term-end.
Cash flows from operating activities was ¥7,764,417 thousand, compared with ¥11,970,529 thousanda year earlier. The main factor here was an increase of cash due to the recording of Profit before income
taxes of ¥17,297,208 thousand, which outweighed Income taxes paid of ¥-5,328,953 thousand.
Cash flows from investing activities was ¥-6,314,202 thousand, compared with ¥-4,146,968 thousanda year earlier. The main expenditure were Purchase of shares of subsidiaries resulting in change inscope of consolidation ¥-3,606,745 thousand and Purchase of property, plant and equipment ¥3,469,529 thousand.
Cash flows from financing activities was ¥-6,107,521 thousand, compared with ¥-3,973,487 thousanda year earlier. The main expenditure were Dividends paid ¥-3,607,380 thousand and Purchase oftreasury shares ¥-2,500,140 thousand.
(4) Future Outlook
Regarding the future outlook, it is expected that unclear business circumstances will continue because
CPI is rising and semiconductor materials are lacking.
Under such severe business environment, our group will promote comprehensive efforts to enhancethe organizational structure which enables us to survive fierce global competition, keeping a close lookon the conditions of the global economy and markets.
For fiscal year 2023, we have assumed an exchange rate of \125 to U.S. dollar and \135 to Euro.
The following table shows our forecasts of business performance for the fiscal year 2023.
The amount

%

Sales

\52,272 million

7.4

Operating income\15,070 million-2.1

Ordinary profit\15,836 million-10.3\10,976 million-12.0

Net income attributable toowners of parent(Note) Percentage figures represent year-on-year comparisons.

－ 5 －2. Consolidated Financial Statements and Principal Notes(1) Consolidated Balance Sheets(Thousands of yen)
As of December 31, 2021

As of December 31, 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

34,992,939－
89,402
6,017,059
1,186,445
2,014,230
7,167,378
4,799,134
4,317,667
2,056,477-91,139
62,549,596

15,431,241
7,486,174
5,205,578
2,033,155
962,539-15,825,871
15,292,817

18,111,280
9,359,239
5,707,895
2,205,232
720,395-18,475,536
17,628,506

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

704,589
273,378
2,696,223
398,977
4,073,168

8,692,157
4,866,102
2,122,292－
940,349
1,051,965-1,452
17,671,414
34,309,185
94,460,919

6,853,855
6,055,110
1,843,468
7,152
1,923,315
1,221,819-1,532
17,903,188
39,604,863
102,154,460

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Notes receivable - trade
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 and equipment
Intangible assets
Software
Software in progress
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Shares of subsidiaries and associates
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 －(Thousands of yen)
As of December 31, 2021

As of December 31, 2022

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

1,535,530
100,000
21,8432,764,786
983,394
4,441,744
9,847,300－
342,260
412,271
192,319
946,851
11,541,446

358,957
162,065579,708
183,772
1,284,503
11,131,804

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

867,948
1,180,482
93,628,490-9,293,944
86,382,977

1,843,974

1,403,982

819,197

2,950,583

2,663,172

4,354,565

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

278,685
6,427
91,022,656
102,154,460

Liabilities
Current liabilities
Accounts payable - trade
Short-term borrowings
Current portion of long-term borrowings
Income taxes payable
Provision for bonuses
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
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 income
Valuation difference on available-for-salesecurities
Foreign currency translation adjustment
Total accumulated other comprehensive
incomeShare acquisition rights
Non-controlling interests
Total net assets
Total liabilities and net assets－ 7 －(2) Consolidated Statements of Income and Comprehensive Income(Consolidated Statements of Income)(Thousands of yen)
Fiscal year ended
December 31, 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
Surrender value of insurance policies
Subsidy income
Share of profit of entities accounted forusing 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
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
assetsImpairment losses
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit attributable to non-controllinginterests
Profit attributable to owners of parent－ 8 －Fiscal year ended
December 31, 2022

44,857,730
17,562,599
27,295,131

48,671,452
17,449,753
31,221,698

13,544,697

15,832,469

13,750,434

15,389,229

79,082
46,278102,448
638,780

160,465－－
32,133

226,120
35,927284,155

812,454－
154,114756,230

610,939
202,941
2,629,610

3,382

2,761

－

282,091

9,829
496,460
45,324554,997
13,951,666

13,757－73,667372,277
17,646,562－
17,087
17,087

70,157－
70,157－40,65331,124

4,189－
31,124
13,937,629
4,439,352-605,668
3,833,684
10,103,944

374,668
419,511
17,297,208
5,494,590-670,669
4,823,920
12,473,287

1,335

1,747

10,102,609

12,471,540

(Consolidated Statements of Comprehensive Income)(Thousands of yen)
Fiscal year ended
December 31, 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 －Fiscal year ended
December 31, 2022

10,103,944

12,473,287-440,192-439,991

913,888473,696
10,577,641

2,132,278
1,692,286
14,165,574

10,576,209

14,162,934

1,431

2,640

(3) Consolidated Statements of Changes in Net Assets
Fiscal year ended December 31, 2021
(Thousands of yen)
Shareholders' equity
Retained

Capital stock

Capital surplus

867,948

1,180,482

Net assets

Treasury sharesearnings
77,435,739-5,593,711

Shareholders'equity73,890,460

Changes of items during
periodDividends of surplus-2,773,015-2,773,015

10,102,609

10,102,609

Profit (loss)
attributable to ownersof parent
Purchase of treasury
shares-1,200,092-1,200,092

Net changes of items
other thanshareholders' equity
Total changes of items－－

7,329,593-1,200,092

6,129,501

867,948

1,180,482

84,765,333-6,793,803

80,019,961

during period
Net assets

Accumulated other comprehensive income
Valuationdifferenceon

Foreigncurrency

available-translation

for-saleadjustment

securities
Net assets

2,284,166-94,595

Valuationandtranslation
adjustment

Share

Non-

acquisition

controllingrightsinterests

Net assets

s2,189,571

189,688

2,355

76,272,075

Changes of items during
periodDividends of surplus-2,773,015

Profit (loss)
attributable to owners

10,102,609

of parent
Purchase of treasury-1,200,092

sharesNet changes of items
other than

-440,192

913,792

473,600

42,864

1,431

517,896-440,192

913,792

473,600

42,864

1,431

6,647,397

1,843,974

819,197

2,663,172

232,552

3,786

82,919,473

shareholders' equity
Total changes of items
during period
Net assets－ 10 －

Fiscal year ended December 31, 2022
(Thousands of yen)
Shareholders' equity
Capital stock

Capital surplus

867,948

1,180,482

Net assets

Retained

Treasury sharesearnings
84,765,333-6,793,803

Shareholders'equity80,019,961

Changes of items during
periodDividends of surplus-3,608,383-3,608,383

12,471,540

12,471,540

Profit (loss)
attributable to ownersof parent
Purchase of treasury
shares-2,500,140-2,500,140

Net changes of items
other thanshareholders' equity
Total changes of items－－

8,863,157-2,500,140

6,363,016

867,948

1,180,482

93,628,490-9,293,944

86,382,977

during period
Net assets

Accumulated other comprehensive income
Valuationdifferenceon

Foreigncurrency

available-translation

for-saleadjustment

securities
Net assets

1,843,974

819,197

Valuationandtranslation
adjustment

Share

Non-

acquisition

controllingrightsinterests

Net assets

s2,663,172

232,552

3,786

82,919,473

Changes of items during
periodDividends of surplus-3,608,383

Profit (loss)
attributable to owners

12,471,540

of parent
Purchase of treasury-2,500,140

sharesNet changes of items
other than-439,991

2,131,385

1,691,393

46,1322,640

1,740,165-439,991

2,131,385

1,691,393

46,1322,640

8,103,182

1,403,982

2,950,583

4,354,565

278,685

6,427

91,022,656

shareholders' equity
Total changes of items
during period
Net assets－ 11 －

(4) Consolidated Statements of Cash Flows(Thousands of yen)
Fiscal year ended
December 31, 2021
Cash flows from operating activities
Profit before income taxes
Depreciation
Impairment losses
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 investments in money held in
trust
Loss (gain) on sale of investment securities
Loss (gain) on sale of property, plant andequipment
Loss on retirement of property, plant andequipment
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

Fiscal year ended
December 31, 2022

13,937,629
1,807,907－
54,561

17,297,208
2,049,311
374,668
55,115-33,477

22,810524,596

73,79825,317-197,708-125,361-741,228

3,382

2,761

-284,155-812,454-160,465

282,091-17,087－－-29,504

31,124

4,189-32,133-2,404-35,927-89,177-837,027-70,825-1,125,915－ 12 －-3,665,855
134,345-1,626,574-1,326,730

1,631,950
15,327,616
220,063-3,382-3,605,900
32,133

11,771,140
1,289,065-2,761-5,328,953
35,927

11,970,529

7,764,417

(Thousands of yen)
Fiscal year ended
December 31, 2021
Cash flows from investing activities
Proceeds from sale and redemption of
securities
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 resulting
in change in scope of consolidation
Purchase of shares of subsidiaries andassociates
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of insurance funds
Proceeds from cancellation of insurancefundsLong-term loan advances
Proceeds from cancellation of money held in
trust
Other, net
Net cash provided by (used in) investing
activities
Cash flows from financing activities
Purchase of treasury shares
Dividends paid
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－ 13 －

Fiscal year ended
December 31, 2022

700,000－-1,768,897-3,469,529－

69,035-582,958-4,341,680-514,712

945,291

2,461,769－-3,606,745－-1,662,206-4,369,139-7,593,927

5,602,868-38,810

5,376,039-14,233

98,226523,136－-96,900－

2,212,410-391,867

1,660-4,146,968-6,314,202-1,200,092-2,773,394-2,500,140-3,607,380-3,973,487-6,107,521

992,971

1,418,061

4,843,045-3,239,245

30,044,771

34,887,816

34,887,816

31,648,571－

(5）Notes to Consolidated Financial Statements(Notes to Going Concern Assumption)
Not applicable.

－ 14 －

(Segment Information）【Segment Information】
Fiscal year ended December 31, 2021 (From January 1, 2021 to December 31, 2021)(Thousands of yen)
Reportable segments

Reconcilingconsolidated
financial

DentalSurgicalIndustrial

Reportablesegment

segment

segment

segments

38,257,258

2,761,146

3,839,325

44,857,730－

44,857,730

－

－

－

－

－

－

38,257,258

2,761,146

3,839,325

44,857,730－

44,857,730

15,556,444

1,303,566

1,377,490

18,237,501-4,487,067

13,750,434

items

statements

Sales
Revenues
fromexternalcustomers
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.

－ 15 －

Fiscal year ended December 31, 2022 (From January 1, 2021 to December 31, 2022)(Thousands of yen)
Reportable segments

Reconcilingconsolidated
financial

DentalSurgicalIndustrial

Reportablesegment

segment

segment

segments

40,926,711

3,160,058

4,584,682

48,671,452－

48,671,452

－

－

－

－

－

－

40,926,711

3,160,058

4,584,682

48,671,452－

48,671,452

17,024,344

1,571,575

1,683,337

20,279,257-4,890,028

15,389,229

items

statements

Sales
Revenues
fromexternalcustomers
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.

－ 16 －