Briefing Materialfor 3rd quarter ended Sep. 30, 2022
November 11, 2022
NAKANISHI INC.

Disclaimer
The information presented in these materials contains forward-looking statements about futurebusiness performance. These statements by definition involve risks and uncertainties and are
not intended to guarantee future performance. Actual results in the future may differ fromexpectations and the projections presented in these materials due to changes in the global
economy and fluctuations in foreign currency exchange rates and so on. NSKNSKNSKNSKNSK

Changes in reporting segments
Key changes

1. “Surgical Business” was separated from the previous reporting segment “Dental Products” andindividually established
2. Abolition of the previous reporting segment “Others (mainly included repair services)”, which will beincluded in each new reporting segments

Previous reporting segments

New reporting segments
RenameDental Products

Dental BusinessSeparate

Surgical Business

RenameIndustrial Products

Industrial Business

OthersAbolition© 2022 NAKANISHI INC.

＊Starting from FY2022 Q1Development, production and sales ofwide range of dental equipment, which
cover such as restorative dentistry,
periodontics, mobile dental care, oralsurgery etc.
Development, production and sales ofbone grinding and cutting drills which canbe used in areas of neurosurgery, spinesurgery and orthopedic surgery.

Development, production and sales ofmotors and spindles which can be used inhigh-precision processes in wide range ofindustrial areas such as automobile,aircraft, precision parts industries.

2

Product lineup

DentalBusiness
Dental hand piece

Oral surgery system

Oral hygiene system

ConsoleSlim motor

Attachment

ControllerSpindle

Micro grinder

Clinical micromotor

SurgicalBusinessBur

IndustrialBusiness© 2022 NAKANISHI INC.

Ultrasonic grinder3

Consolidated financial result for FY2022Q3

4

Performance highlights of FY2022Q3● The depreciation of the yen against major trading currencies boosted sales and profits.
Topline has been quite flat on YOY and local currency basis.

● Due to the successful parts purchasing and design changes, we could minimize impact
on production. Upward revision of full-year earnings forecast as production by the endof the year is in sight.

● New factory “A1+” started operation and production of precision parts.
We have promoted enhancing production capacity by automating and rectifying
production lines.

© 2022 NAKANISHI INC.

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Consolidated P/L
M of JPY

FY2022Q3

FY2021Q3

ActualActualNet sales

36,10033,469+2,631+7.9 %

Gross profit

23,084

20,473+2,610+12.8 %

61.2 %+2.8 pt－

11,894

11,113+780+7.0 %

33.2 %-0.3 pt－

14,694

11,266+3,428+30.4 %

33.7 %+7.0 pt－

10,2088,096+2,112+26.1 %

28.3 %

24.2 %+4.1pt－

118.9293.45－－FY2022Q3
ActualFY2021Q3
ActualYoY Comparison

FY2022Forecast

Comparison vsForecast

Ratio to net sales

Operating profit
Ratio to net sales

Ordinary profit
Ratio to net sales

Profit attributableto owners of parent
Ratio to net sales

EPS(JPY)

Currency rate

63.9 %
32.9 %

40.7 %YoY Comparison
AmountRatio- Against the US dollar（JPY）

128.02108.55+19.47124.00+4.02- Against the EURO（JPY）

136.01129.94+6.07

131.00+5.01・Forex impact :Net sales +2,286M of JPY （vs FY2021Q3 Actual), +833M of JPY（vs Forecast）

・Forex sensitivity :Fluctuation in annual net sales due to the depreciation of the yen (per one yen)
Against USD: Increase of 86M of JPY
Against EURO: Increase of 78M of JPY© 2022 NAKANISHI INC.

6

Net sales and OP profit
M of JPY

Composition ratio

Amount36,10040,000[ Net sales ]35,00033,469[ Net sales ]Net sales
YoY

33,46936,100
COGS%
YoY

100%

+2,631

13,01530,00025,000-2.8 pt90%

Excluding the forex impact,
net sales remained flat year
on year12,995[ COGS ]

+7.9%

80%

[ COGS% ]

38.8%

36.1%

28.0%

31.0%Impact of higher parts
prices were offset by priceincrease and thedepreciation of yen

70%

60%
20,000[ SGA ]

15,0009,360

11,19050%[ SGA% ]
40%

OP
YoY

10,000[ OP ]

5,000

SGA%
YoY

30%

+780

11,113

11,894+3.0 pt

+7.0%

20%

The depreciation of yen
boosted profits

0FY2021Q3Actual[ OP margin ]FY2022Q3Actual© 2022 NAKANISHI INC.

33.2%

32.9%

FY2021Q3
ActualFY2022Q3
Actual

10%0%

Normalized marketing
activities and thedepreciation of yen
resulted in increased
SGA%7Change in net sales by business segment
M of JPY+ 2,631+ 7.9%

17,000

FY2021Q3
ActualFY2022Q3
ActualChangeDental

28,67930,301+5.7%

Surgical

2,042

2,393

+17.2%

Industrial

2,747

3,405

+24.0%

33,46936,100+7.9%

36,10016,000+658+350

15,00014,00033,469+1,622

Surgical+17.2%

Industrial+24.0%

Dental

13,000+5.7%
12,000Total

11,000Forex impact+2,286 M of JPY（+6.8%）

10,000

FY2021Q3
ActualFY2022Q3
Actual© 2022 NAKANISHI INC.

8

Change in net sales by region
M of JPY+ 2,631+ 7.9%

17,00016,00015,000+2,140
14,00036,10012,000-807+1,050Japan-10.8%

Europe+10.5%

FY2022Q3
ActualChange-28+276Japan

7,445

6,637-10.8%

Asia
-0.5%

Others+6.0%

Europe9,973

11,024+10.5%

N. America

5,944

8,084

+36.0%

Asia

5,479

5,450-0.5%

Others

4,626

4,902

+6.0%

Total

33,46936,100+7.9%

33,46913,000

FY2021Q3
ActualN. America+36.0%

11,000Forex impact
impactForex+2,286
M of JPY（+6.8%）（+6.8%）+2,286百万円

10,000

FY2021Q3
ActualFY2022Q3Actual© 2022 NAKANISHI INC.

9

Change in operating profit by segment
M of JPY+ 780
FY2021Q3
ActualFY2022Q3
ActualChangeDental12,177

12,727+4.5%

Surgical

1,020

1,233

+20.9%

Industrial

1,023

1,310

+28.0%

Corporate
expenses-3,107-3,377－

Total

11,113

11,894+7.0%+ 7.0%

5,800

5,300

+213
4,800

11,113+549

Surgical+20.9%+286-269

Industrial+28.0%

Corporate
expenses

11,894

Dental
+4.5%

4,300

3,800

Forex impact+1,764 M of JPY（+15.9%）

3,300

FY2021Q3
ActualFY2022Q3
Actual© 2022 NAKANISHI INC.

10

Change in operating profit
Exchange rate

M of JPY

2021/09
Average

+ 780

6,000

USD

JPY 108.55→

JPY 128.02

EURO

JPY 129.94→

JPY 136.01+ 7.0%

11,894

5,500

+ 113

5,000

11,1134,500+ 211
Increasein demand

4,000

3,500

2022/09
Average

Product mix-420
Increase inselling expenses+ 1,764-300
Increase inpersonnel
expenses-587
Increase inForex impact
other expenses

3,000

Based on forex as of 2021Q3
2,500

FY2021Q3
ActualFY2022Q3
Actual© 2022 NAKANISHI INC.

11

OP profit and profit attributable to owners of parent
M of JPY

11,894

Operating profit

3,166

Non-operating profit

365

Non-operating expenses

14,694

Ordinary profit

Non-operatingprofit

・Foreign exchange gain

2,593

Non-operating
expenses・ Loss on investments inmoney held in trust

312

Extraordinary
income・ Gain on sales of non-current assets

66

Extraordinarylosses

・ Impairment losses

326

66

Extraordinary income

Extraordinary losses

367

Profit before income taxes

14,393
4,185

Total income taxes

10,208

Profit attributable to owners of parent
300

1,300

2,300

3,300

4,300

5,3006,300

7,300

8,300© 2022 NAKANISHI INC.

9,300

12Consolidated balance sheet
M of JPY

As of Sep. 30,
2022

As of Dec. 31,
2021

Change100,926

94,460+6,46635,3385,780
14,351

35,984
5,348
11,733-645+431+2,618

10,200

11,541-1,340100

100―90,726

82,919+7,80691,36584,765+6,600Return on equity (ROE)

14.5 %

12.7 %+1.8 pt

Return on assets (ROA)

18.4 %

15.8 %+2.6 pt

FY2022Q3
ActualFY2021Q3
ActualChangeCapital investments

3,064

1,108+1,956

Depreciation expenses

1,441

1,303+137

Total asssets- Cash and deposits- Notes and accounts receivable - trade- Inventories

Liabilities- Loans payable

Net assets- Retained earnings

Note・Buildings and structures+1,851

・Merchandise and finished goods+650
・Work in process+607
・Raw materials and supplies+1,361
・Account payable - trade
・Income taxes payable
・Other current liabilities

+529
-339
-1,470＊ROE and ROA are calculated based on the FY2022 forecast.

© 2022 NAKANISHI INC.

Note
・New factory “A1+”・Information system

1,46927613Revision of consolidated financial forecast
for FY2022

14

Revision of financial forecast for FY2022
M of JPY

FY2022

FY2022

vs. Previous forecast

Revised forecast Previous forecast

AmountFY2021

vs. FY2021 Actual

Ratio

ActualAmountRatio

Net sales

48,58845,788+2,799+6.1 %

44,857+3,730+8.3 %

Gross profit

30,942

27,723+3,218+11.6 %27,295+3,647+13.4 %

Ratio to net sales

63.7 %

60.5 %+3.1 pt—

60.8 %+2.8 pt—

Operating profit

14,91812,606+2,311+18.3 %

13,750+1,167+8.5 %Ratio to net sales

30.7 %

27.5 %+3.2 pt—30.7 %+0.1 pt—

18,024

13,587+4,437+32.7 %

13,951+4,072+29.2 %

37.1 %

29.7 %+7.4 pt—

31.1 %+6.0 pt—

12,5739,621+2,952+30.7 %

10,102+2,470+24.5 %

Ratio to net sales

25.9 %

21.0 %+4.9 pt—

22.5 %+3.4 pt—(JPY)

146.47111.66——116.73——- Against the US dollar (JPY）132.69124.00+8.69—

109.84+22.85—- Against the EURO138.68131.00+7.68—

130.08+8.60—Ordinary profit
Ratio to net sales

Profit attributableto owners of parent

EPS
Currency rate（JPY）© 2022 NAKANISHI INC.

15