Consolidated Financial Results for the Fiscal Year Ended December 20, 2013
[Japanese GAAP]
January 22, 2014
Name of registrant:
Milbon Co., Ltd.
Tokyo Stock Exchange, First Section
Code No.:4919
URL http://www.milbon.co.jp
Representative:
Ryuji Sato, President and CEO
Inquiries:
Masahiro Murai, Managing Director
TEL: +81-6-6928-2331
Scheduled date of annual general meeting of shareholders: March 18, 2014
Scheduled filing date for Securities Report: March 18, 2014:
Scheduled starting date of dividend payments: March 19, 2014
Preparation of supplementary materials on the Consolidated Financial Results: Yes
Holding of an explanatory meeting on Consolidated Financial Results: Yes (For institutional investors and analysts)(Amounts of less than one million yen have been omitted)

1.

Consolidated financial results for the fiscal year ended December 20, 2013 (December 21, 2012- December 20, 2013)(1) Consolidated operating results
Net sales
Million yen
Year ended
December 20, 2013
Year ended
December 20, 2012
(Note) Comprehensive income(Percentages show year-on-year changes)
Net income%
Million yen%%

Ordinary income
Million yen

23,829

8.9

4,302

7.9

4,059

8.7

2,516

18.2

21,887

6.6

3,986

5.1

3,735

5.3

2,128

(7.7)

%

Operating income
Million yen

Year ended December 20, 2013: 3,170 million yen [42.9%]

Net income per share
Diluted net income per share
Yen
Yen
Year ended
152.85
December 20, 2013
Year ended
128.70December 20, 2012
(Reference)
Equity in earnings (losses) of affiliates

Year ended December 20, 2012: 2,219 million yen [1.0%]

Return on equity (ROE)%

Return on assets (ROA)
%

-

11.8

16.2

18.1

-

10.8

16.2

18.2

Year ended December 20, 2013: -- million yen

Operating income ratio%

Year ended December 20, 2012: -- million yen(Note) The Company conducted a 1.2 for 1 stock split of its common stock effective December 21, 2013. Consequently, the net income per share calculated and retrospectively
adjusted assuming that the stock split was conducted at the beginning of the previous consolidated fiscal year is presented.

(2) Consolidated financial position
Total assets
As of December 20,
2013
As of December 20,
2012(Reference)
EquityNet assets

Equity ratio

Net assets per share

Million yen

Million yen%

Yen26,321

22,14984.1

1,352.34

20,36786.1

1,231.68

23,662As of December 20, 2013: 22,149 million yen

As of December 20, 2012: 20,367 million yen(Note) The Company conducted a 1.2 for 1 stock split of its common stock effective December 21, 2013. Consequently, the net assets per share calculated and retrospectively
adjusted assuming that the stock split was conducted at the beginning of the previous consolidated fiscal year are presented.

(3) Consolidated cash flows
Cash flow from operating activities Cash flow from investing activities Cash flow from financing activities Balance of cash and cash equivalents
Million yen
Million yen
Million yen
Million yen
Year ended
December 20, 2013
Year ended
December 20, 2012

3,511

(1,198)(1,387)

6,610

2,977

(1,506)

(910)

5,633

2. Payment of dividends
Annual dividend
End of 1st quarter End of 2nd quarter End of 3rd quarter End of fiscal year
Yen

Yen

Yen

Total dividends(Annual)

Total

Dividend payout
ratio(Consolidated)

Dividends onequity (DOE)(Consolidated)

Yen

Yen
Million yen%%
Year ended
32.00
34.00
66.00
909
42.7
4.6
December 20, 2012
Year ended
33.00
35.00
68.00
932
37.1
4.4
December 20, 2013
Year ending
34.00
34.00
68.00
42.8
December 20,
2014(forecast)(Note) The Company conducted a 1.2 for 1 stock split of its common stock effective December 21, 2013. The dividends for the year ended December 20, 2012 and the year
ended December 20, 2013 presented here are the amounts of actual dividends prior to the stock split.

3. Consolidated operating forecasts for the fiscal year ending December 20, 2014 (December 21, 2013 - December 20, 2014)(Percentages show year-on-year changes)
Net sales
Million yen
Six months ending June 20, 2014
Year ending December 20, 2014

12,07025,2005.6
5.8

Operating income% Million yen

Ordinary income% Million yen

1,734
4,500

1,589
4,215

(21.0)
4.6

Net income% Million yen(23.0)
3.8

973
2,600

%

(23.5)
3.3

Net income per share
Yen
59.41
158.74

*Notes(1) Significant changes in subsidiaries during the period(changes in specified subsidiaries accompanied by changes in the scope of consolidation) : None
New: 0 companies (Company name: )Exclude: 0 companies (Company name: )(2) Changes in accounting policies, changes in accounting estimates and retrospective restatements
1) Changes in accounting policies due to amendment to theaccounting standards, etc.
: None2) Changes in accounting policies other than those in 1) above: None3) Changes in accounting estimates: None4) Retrospective restatements: None(3) Number of shares issued (common stock)1) Number of shares issued at the end of the period(including treasury stock)2) Number of treasury stock at the end of the period

Year ended
December 20, 2013
Year ended
December 20, 2013
Year ended
December 20, 2013

3) Average number of shares during the period

16,558,617 shares
179,953 shares
16,462,012 sharesYear ended
December 20, 2012
Year ended
December 20, 2012
Year ended
December 20, 2012

16,558,617 shares
22,459 shares
16,536,642 shares(Note) The Company conducted a 1.2 for 1 stock split of its common stock effective December 21, 2013. Consequently, the number of shares issued at the end of the period,
the number of treasury stock at the end of the period, and the average number of shares during the period calculated and retrospectively adjusted assuming that the stock split
was conducted at the beginning of the previous consolidated fiscal year are presented.

(Reference) Summary of non-consolidated operating results1.

Non-consolidated financial results for the fiscal year ended December 20, 2013 (December 21, 2012- December 20, 2013)(1) Non-consolidated operating results
Net sales
Million yen
Year ended
23,180December 20, 2013
Year ended
21,403
December 20, 2012

%

%

8.3

4,516

12.5

4,254

13.1

2,545

18.2

5.9

4,015

3.6

3,761

3.8

2,153

(9.3)

Net income per share

Ordinary income
Million yen(Percentages show year-on-year changes)
Net income%
Million yen%

Operating income
Million yen

Diluted net income per share
Yen

Yen
Year ended
154.66
December 20, 2013
Year ended
130.24
December 20, 2012
(Note) The Company conducted a 1.2 for 1 stock split of its common stock effective December 21, 2013. Consequently, the net income per share calculated and retrospectively
adjusted assuming that the stock split was conducted at the beginning of the previous fiscal year is presented.
(2) Non-consolidated financial position
Total assets
As of December 20,
2013
As of December 20,
2012(Reference)
EquityNet assets

Equity ratio

Net assets per share

Million yen

Million yen%

Yen26,192

22,53386.0

1,375.78

20,96986.7

1,268.10

24,175
As of December 20, 2013: 22,533 million yen

As of December 20, 2012: 20,969 million yen(Note) The Company conducted a 1.2 for 1 stock split of its common stock effective December 21, 2013. Consequently, the net assets per share calculated and retrospectively
adjusted assuming that the stock split was conducted at the beginning of the previous fiscal year are presented.

2.

Non-consolidated operating forecasts for the fiscal year ending December 20, 2014 (December 21, 2013 - December 20, 2014)(Percentages show year-on-year changes)

Six months ending June 20,
2014Year ending December 20,
2014

Net sales
Million yen%

Ordinary income
Million yen

11,662

4.8

1,696(21.1)

24,325

4.9

4,330

1.8

%

Net income
Million yen%

Net income per share
Yen

1,071

(19.9)

65.43

2,700

6.1

164.85*Indication of the status of execution of audit procedures
As these financial results are not subject to audit procedures pursuant to the Financial Instruments and Exchange Act, said audit procedures were notcompleted at the time of disclosure of this report.
*Explanation on the appropriate use of operating forecasts and other special instructions
Operating forecasts and other statements regarding the future presented in these materials are based on information currently available and certain
assumptions deemed to be reasonable, and actual performance may differ substantially due to various factors. For notes on the use of preconditions ofoperating forecasts and the use of operating forecasts, refer to “1. Analysis of operating results and financial conditions (1) Analysis of operating results”
on page 2 of the supplementary materials.

Milbon Co., Ltd. (4919) Consolidated Financial Results for the Fiscal Year Ended December 20, 2013

Contents of supplementary materials
1. Analysis of operating results and financial conditions ............................................................................................................... 2(1)

Analysis of operating results ............................................................................................................................................ 2(2)

Analysis of financial conditions ....................................................................................................................................... 3(3)

Basic policy on the distribution of profit and dividends for the fiscal year under review and the following fiscal year .. 4

(4)

Business and other risks ................................................................................................................................................... 5

2. Outline of the Milbon Group ..................................................................................................................................................... 5
3. Management policy .................................................................................................................................................................... 6(1)

Basic management policies .............................................................................................................................................. 6(2)

Target management indices .............................................................................................................................................. 6(3)

Medium- to long-term management strategies ................................................................................................................. 6(4)

Tasks to be addressed by the Company ............................................................................................................................ 6

4. Consolidated Financial Statements ............................................................................................................................................ 7(1)

Consolidated Balance Sheets ........................................................................................................................................... 7(2)

Consolidated Statements of Earnings and Consolidated Statements of Comprehensive Income ..................................... 9(3)

Consolidated Statements of Changes in Shareholders’ Equity ....................................................................................... 11(4)

Consolidated Statements of Cash Flows ........................................................................................................................ 13-1-

Milbon Co., Ltd. (4919) Consolidated Financial Results for the Fiscal Year Ended December 20, 2013

1.

Analysis of operating results and financial conditions(1)

Analysis of operating results
1)

Operating results for the consolidated fiscal year under review
During the consolidated fiscal year under review, our nation’s economy was on a moderate recovery trend, as the yen grew
weaker and stock prices rose as a result of the government’s economic measures, while corporate earnings improved andpersonal consumption also seemed to pick up. Nevertheless, uncertainty over the future continued to prevail due toconcerns about the decelerating economies of the emerging nations and other factors. In the beauty industry, amid the harshbusiness climate precipitated by the effects of the declining population, the low birth rate and the aging society, there has
been a growing awareness of beauty among women in their 30’s to 50’s who form the core of the customer base, and there
has been a marked increase in yearly usage amounts per customer in their 30’s to 50’s who use our partner salons.
Under such circumstances, the Milbon Group has been changing awareness of mature women who make up its clientele,
and being fully aware of the importance of creating new value, has been promoting initiatives intended for salons under theslogan of “Promotion of Age Beauty Innovation, in which professional designers answer to the new values held by mature
women.”As a result of directly addressing the concerns of mature women over their hair and scalp, and concentrating its efforts onproviding products and services that focus on aging care, the Group was able to achieve our targets for both consolidated
net sales and multiple-step income, and reach record highs in both.
Consolidated net sales during the consolidated fiscal year under review increased by 1,942 million yen to 23,829 million
yen (up 8.9% year-on-year). This was primarily due to the strong sales of the aging care brand, Plarmia, which werelaunched in February and September, and the premium hair care brand, Aujua, in the hair-care product category; and thestrong sales of the permanent hair coloring brand Ordeve and Ordeve Beaute, the product line specialized for gray hair, inthe hair coloring product category. Double-digit growth of sales in China and South Korea thanks to the proactive
educational activities conducted in the salons was another factor of the increase.
Selling, general and administrative expenses increased by 9.4% over the previous year to 11,872 million yen, as a result ofsales promotion expenses of new products and personnel expenses exceeding the previous year levels. Operating income
increased by 316 million yen to 4,302 million yen (up 7.9% year-on-year), ordinary income also increased by 324 million
yen to 4,059 million yen (up 8.7% year-on-year) and net income increased by 387 million yen to 2,516 million yen (up18.2% year-on-year).

Breakdown of net sales by product category and breakdown of net sales into domestic and overseas sales are shown below:[Breakdown of consolidated net sales by product category]Previous Consolidated
Fiscal Year
Product Category
AmountRatio (%)

(Unit: Million yen)
Current Consolidated
Fiscal Year
AmountRatio (%)

Increase(Decrease)
AmountPercentage
Change (%)

Hair care products

11,06950.6

12,616

52.9

1,547

14.0

Hair coloring products

8,820

40.3

9,288

39.0

467

5.3

Permanent wave products

1,678

7.7

1,623

6.8

(55)

(3.3)

Others

318

1.4

301

1.3

(17)

(5.4)

Total

21,887100.0

23,829

100.0

1,942

8.9

[Breakdown of net sales into domestic and overseas sales]
Previous Consolidated
Fiscal Year
AmountRatio (%)

(Unit: Million yen)
Current Consolidated
Fiscal Year
AmountRatio (%)

Increase(Decrease)
AmountPercentage
Change (%)

Domestic sales

20,482

93.6

21,946

92.1

1,463

7.1

Overseas sales

1,404

6.4

1,882

7.9

478

34.1

Total

21,887100.0

23,829

100.0

1,942

8.9

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Milbon Co., Ltd. (4919) Consolidated Financial Results for the Fiscal Year Ended December 20, 2013

2)

Outlook for fiscal 2014
In terms of the domestic economic environment, while a moderate recovery trend prevails due to the penetration of theeffects of the government’s economic measures, the last-minute demand and pullbacks in consumer spending
accompanying the consumption tax hike in April are expected to have a complex effect, and uncertainty about the future
will continue to persist. In the beauty industry, despite the progressive decrease in the productive-age population (15 to 64
years old), the low birth rate and the aging society, there has been a growing trend among mature women to aggressively
invest in what they perceive to be of intrinsically superior value, and consequently an increase in yearly usage amounts per
customer is expected, particularly spending per customer of women mainly in their 40’s, as well as women in their 30’s and50’s who use our partner salons.
Under these circumstances, the Milbon Group, fully aware of the importance of enhancing “intangible value” based oncommunication that will answer to the values of mature women, will promote initiatives geared toward the salons under theslogan of “supporting the creation of persons and the creation of appeal as professionals that will create intrinsic andabsolute value on the salon stage.”
The full-fledged, nationwide campaign to market organic products, which commenced in fiscal 2013, is expected to further
contribute to capturing new customers for the salons through the addition of new products.
In terms of global expansion, our Thai plant, which will become the base for supplying products overseas, will commence
full operations and promptly answer to the demands of each country. Marketing operations in Thailand, Malaysia andVietnam, which commenced in fiscal 2013, will expand their product lineup. Additionally, we will commence trial
marketing in Indonesia, in addition to dispatching employees to Brazil to begin a field survey of the area.
As a result of these efforts, the Company expects consolidated net sales of 25,200 million yen (up 5.8% year-on-year),consolidated operating income of 4,500 million yen (up 4.6% year-on-year), consolidated ordinary income of 4,215 million
yen (up 3.8% year-on-year), and consolidated net income of 2,600 million yen (up 3.3% year-on-year).

(2)

Analysis of financial conditions
1)

Assets, liabilities and net assets
Total assets at the end of the current consolidated fiscal year increased by 2,659 million yen compared to the end of theprevious consolidated fiscal year to 26,321 million yen.
Current assets increased by 1,338 million yen compared to the end of the previous consolidated fiscal year to 12,938
million. This was mainly due to the increase in cash and deposits by 779 million yen.
Noncurrent assets increased by 1,320 million yen compared to the end of the previous consolidated fiscal year to 13,383
million yen. This was mainly due to increase in construction in progress by 749 million yen and the increase in investment
securities by 630 million yen.
Current liabilities increased by 872 million yen compared to the end of the previous consolidated fiscal year to 3,970
million yen. This was mainly due to the increase in accounts payable-other by 355 million yen and the increase in income
taxes payable by 297 million yen.
Noncurrent liabilities increased by 4 million yen from the end of the previous consolidated fiscal year to 201 million yen.
Net assets increased by 1,782 million yen compared to the end of the previous consolidated fiscal year to 22,149 million
yen. This was mainly due to the increase of 1,592 million yen in retained earnings.
As a result, equity ratio changed from 86.1% at the end of the previous consolidated fiscal year to 84.1%. Net assets per
share based on total outstanding shares as of the end of the current consolidated fiscal year increased from 1,231.68 yen per
share at the end of the previous consolidated fiscal year to 1,352.34 yen per share.

2)

Cash flows
Cash and cash equivalents (hereinafter “net cash”) at the end of the current consolidated fiscal year increased by 977
million yen compared to the end of the previous consolidated fiscal year to 6,610 million yen, as a result of using the net
cash provided by operating activities for the payment of income taxes and the payment of dividends.
(Cash flows from operating activities)
Net cash provided by operating activities amounted to 3,511 million yen. This was mainly the result of posting 4,048
million yen in income before income taxes and minority interests, depreciation and amortization of 882 million yen and
1,350 million yen in income taxes paid.
(Cash flows from investing activities)
Net cash used in investing activities amounted to 1,198 million yen. This was mainly due to the purchase of property, plantand equipment of 1,319 million yen.

-3-

Milbon Co., Ltd. (4919) Consolidated Financial Results for the Fiscal Year Ended December 20, 2013

(Cash flows from financing activities)
Net cash used in financing activities amounted to 1,387 million yen. This was mainly due to the net increase of 465 million
yen in treasury stock and to the cash dividends paid to shareholders of 922 million yen.
(Reference) Cash flow-related indicators
Year ended
December 20,
2009

Year ended
December 20,
2010

Year ended
December 20,
2011

Year ended
December 20,
2012

Year ended
December 20,
2013

81.8

84.9

84.4

86.1

84.1

125.6

131.4

146.0

163.8

243.3

2.8

3.3

2.6

2.7

2.3

3,282.8

-

-

-

-

Equity ratio (%)
Equity ratio based on market
value (%)
Interest-bearing debt to cash
flows ratio (%)
Interest-coverage ratio (times)(Notes) Equity ratio: Total net assets/total assets
Equity ratio based on market value: Total market capitalization/total assets
Interest-bearing debt to cash flows ratio: Interest-bearing debt/cash flows
Interest-coverage ratio: Cash flows/interest payments**

All of the figures in the aforementioned indices were calculated on a consolidated basis.
Total market capitalization was calculated by multiplying the closing stock price at the end of the period by the total number ofoutstanding shares at the end of the period (excluding treasury stock).

*

Cash flows were shown as an operating cash flow in the consolidated statements of cash flows.

*

Interest-bearing debt refers to all debt posted in the consolidated balance sheets upon which interest is paid. The amount ofinterest paid in the consolidated statements of cash flows was treated as an interest payment in the calculations above.

(3)

Basic policy on the distribution of profit and dividends for the fiscal year under review and the following fiscal year
The Milbon Group considers the returning of profits to shareholders as an important management issue and makes it a basic
policy to pay dividends in accordance with its operating results, while enhancing its business structure by maintaining
internal reserves to the end of improving its earnings in the future. In addition, interim dividends are determined at the Boardof Directors meetings and year-end dividends at the general meeting of shareholders, and it is the Group’s basic policy to pay
dividends twice every fiscal year.
For the current consolidated fiscal year, upon comprehensively taking into account factors including our financial positionand profit levels, we have decided to pay an interim dividend of 33 yen per share, and a year-end dividend of 35 yen per share,
for a total annual dividend of 68 yen per share, which represents an increase of 2 yen per share compared to the previous
fiscal year. For the following fiscal year, we plan to pay an annual dividend of 68 yen per share. The Company conducted a
1.2 for 1 stock split of its common stock effective December 21, 2013.
Internal reserves are used for capital expenditures required for the medium- to long-term expansion of our business as well as
R&D investments, to the end of enhancing our business structure.

-4-

Milbon Co., Ltd. (4919) Consolidated Financial Results for the Fiscal Year Ended December 20, 2013

(4)

Business and other risks
Risks that could potentially affect the operating results, stock price and financial position of the Milbon Group include thefollowing.
The future risks identified in this section are based on assessments made by the Company as of the end of the consolidated
fiscal year under review. The Group recognizes the possibility of these risk events actually occurring and has preparedpolicies to prevent and avert such risks and take appropriate measures to minimize the impact of such risks when they dooccur.
1) Risks associated with global expansion
The Milbon Group is aggressively expanding its business into the overseas markets. Global expansion entails risks relating
to intellectual property rights including counterfeit goods, unforeseeable changes in laws and regulations, and risks ofsocial unrest due to terrorism, war and other factors. Such risks could have a major impact on the Group’s operating results
and financial position.
2) Information security
The Milbon Group has taken various measures to protect information assets including customers’ personal information andconfidential information. However, unforeseeable events, such as the leakage of information due to unauthorized access,could have a major impact on the Group’s operating results and financial position.
3) Risks associated with debt collection
The Milbon Group deliberates and records necessary reserves upon regularly reviewing its business partners from bothquantitative and qualitative perspectives and in terms of collection status. However, deterioration in the business partner’s
credit standing or events such as bankruptcy could have a major impact on the Group’s operating results and financial
position.
4) Risks associated with major accidents
The Milbon Group utilizes company cars in its sales activities. The Group implements safety measures that places
maximum priority on human life, including strict control over driving and the reinforcement of safety training. However,should a major accident event occur, it could lead to the loss of the customers’ and the public’s trust in the Group and havea major impact on the Group’s operating results and financial position.

2.

Outline of the Milbon Group
Name

Percentage ofvoting rights held(%)

Relationship with theCompany

Sale of hairproducts

100.0

Sells the Company’s hairproducts in the U.S.

Sale of hairproducts

Sells the Company’s hairproducts in China.
100.0 Three executives holdconcurrent posts at theCompany.

KRW 3,000 Sale of hairmillion products

Sells the Company’s hairproducts in South Korea.
100.0 Two executives holdconcurrent posts at theCompany.

Manufacture and
THB 450 million sale of hairproducts

Manufactures and sells the
100.0 Company’s hair productsin Thailand.

Location

Capital StockNew York, USA

USD 2 million

Main line ofbusiness(Consolidated subsidiaries)

MILBON USA, INC.

Milbon Trading(Shanghai) Co., Ltd.

Milbon Korea Co., Ltd.

Shanghai, China

Seoul, South
Korea

MILBON (THAILAND) CO., Bangkok,
LTD.
ThailandJPY 430 million(Note) All companies fall under the category of “specified subsidiary.”
We have omitted the disclosure of the Company’s “Diagram of Business Activities (Business Details),” as there have been no
significant changes since the “Diagram of Business Activities (Business Details)” which was contained in the Company’s
recent Securities Report (submitted on March 15, 2013).

-5-

Milbon Co., Ltd. (4919) Consolidated Financial Results for the Fiscal Year Ended December 20, 2013

3.
(1)

Management policy
Basic management policies
The Milbon Group, under the slogan of “beautiful hair, beautiful people,” has been developing its business that supports abeautiful way of life through hair designers.
“Beautiful hair enriches people’s spirits. Milbon develops its business to contribute to the industry, countries and regions
under the belief that people rich in spirit will develop culture, and that a society that values culture will bring about peace.”(2)

Target management indices
The Milbon Group, from the perspective of efficiently utilizing equity and generating growth from every unit ofshareholders’ equity, aims to exceed the following indices:

(3)

1)

ROE (Return On Equity): 15% or more

2)

EPS (Earnings Per Share): 150 yen or more

Medium- to long-term management strategies
The Milbon Group, in the “Medium Term 5-Year Business Vision (2010-2014),” which was announced on June 25, 2010,
has set forth the following global vision: “Milbon aims to be the global No.1, first as a Japanese professional manufacturer,
by cultivating global field ideas through human resource development and training in order for hair designers to achieve theirgoals.” The Milbon Group aims to achieve consolidated net sales of 25,000 million yen and overseas sales to total sales ratioof 10.5% in 2014, the final year of the 5-year plan.
In terms of the strategies by areas, we will establish the strong No.1 position in Japan, as it is the foundation for
globalization. For North America, as the symbol of globalization, we create the basis for the Group’s existence and the coreof all field activities. We will also cultivate Asian markets and establish its profit structure as a cornerstone of the Group’s
global growth strategies. We will pursue opportunities to enter the European market, as a source of globalization. As part ofour initiatives toward globalization, we will aim for global growth by establishing a global organizational control, fostering
global human resources, expanding into new areas and establishing an overseas production framework.

(4)

Tasks to be addressed by the Company
1) In the marketing system, establish a program for fostering field persons, including the recruiting of local employees, andenhance the quality of marketing activities and educational assistance at the hair salons, to the end of further evolving ourfield person (trainer/sales staff) strategy.
2) In product development, further improve Target Authority Customer (TAC) product development system, which catches thelatest changes in hair design trends and utilizes such information in development.
3) Promote the establishment of an efficient high-mix variable volume production system, and promote a subcontracted
production in areas outside of Mie prefecture, in order to avoid disaster risk as the production facilities are concentrated there.
4) Promote optimization of the supply chain and greater precision of the production plan, to the end of reducing losses from thedisposal of inventories and improving inventory turnover.
5) In order to advance our global vision, develop a system for fostering human resources capable of international businessactivities, executives with a keen sense of management and specialists.

-6-

Milbon Co., Ltd. (4919) Consolidated Financial Results for the Fiscal Year Ended December 20, 20134.
(1)

Consolidated Financial Statements
Consolidated Balance Sheets
Previous Consolidated Fiscal Year(As of December 20, 2012)(Thousand yen)
Current Consolidated Fiscal Year(As of December 20, 2013)

6,066,322
2,964,933
1,775,588
18,754522,000
179,190
113,719(40,939)
11,599,570

6,845,649
3,110,419
1,987,133
21,957
607,585
269,733
151,201(55,548)
12,938,131

7,354,033(3,741,699)
3,612,333
4,353,063(3,465,615)
887,448
4,763,766
85,294
1,767,460(1,586,871)
180,5889,529,431
526,433

7,721,653(4,066,624)
3,655,029
4,365,291(3,463,005)
902,286
4,867,542
835,253
1,828,754(1,672,808)
155,945
10,416,058
481,762

1,136,817
397,060
542,404(69,240)
2,007,041
12,062,905
23,662,476

1,767,519
193,433
573,968(49,141)
2,485,780
13,383,601
26,321,732

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade
Merchandise and finished goods
Work in process
Raw materials and supplies
Deferred tax assets
Other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Machinery, equipment and vehicles
Accumulated depreciation
Machinery, equipment and vehicles, net
LandConstruction in progress
Other
Accumulated depreciation
Other, net
Total property, plant and equipment
Intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets-7-

Milbon Co., Ltd. (4919) Consolidated Financial Results for the Fiscal Year Ended December 20, 2013

Previous Consolidated Fiscal Year(As of December 20, 2012)(Thousand yen)
Current Consolidated Fiscal Year(As of December 20, 2013)

482,028
1,558,946
647,791
20,97871,204
316,840
3,097,790

501,379
1,914,806
945,236
26,59083,995
498,640
3,970,648

46,231
151,128
197,359
3,295,150

55,564
146,076
201,641
4,172,289

2,000,000
199,120
18,476,098(51,035)
20,624,182

2,000,000
199,183
20,069,024(516,646)
21,751,561(129,363)(127,493)(256,856)
20,367,325
23,662,476

277,439
120,442
397,881
22,149,443
26,321,732

Liabilities
Current liabilities
Accounts payable-trade
Accounts payable-other
Income taxes payable
Provision for sales returns
Provision for bonuses
Other
Total current liabilities
Noncurrent liabilities
Provision for retirement benefits
Other
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets-8-

Milbon Co., Ltd. (4919) Consolidated Financial Results for the Fiscal Year Ended December 20, 2013(2)Consolidated Statements of Earnings and Consolidated Statements of Comprehensive Income
Consolidated Statements of Earnings
Consolidated Fiscal Year Ended December 20, 2012 and 2013

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividends income
Company house defrayment income
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses
Sales discounts
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of noncurrent assets
Total extraordinary income
Extraordinary loss
Loss on retirement of noncurrent assets
Provision of allowance for doubtful accounts
Total extraordinary losses
Income before income taxes and minority interests
Income taxes-current
Income taxes-deferred
Total income taxes
Income before minority interests
Net income

Fiscal Year Ended
December 20, 2012
(December 21, 2011 December 20, 2012)
21,887,379
7,053,704
14,833,674
10,847,413
3,986,260-9-(Thousand yen)
Fiscal Year Ended
December 20, 2013
(December 21, 2012 December 20, 2013)
23,829,758
7,654,832
16,174,925
11,872,215
4,302,709

4,063
33,55557,711
12,11813,063
120,51215,03636,90948,031
43,292
16,176
159,447

371,176230
371,406
3,735,366

401,882621
402,504
4,059,652

-

552
552

138,70212,647
151,3493,584,016
1,440,032
15,6791,455,711
2,128,304
2,128,304

11,404
11,404
4,048,801
1,643,216(110,593)
1,532,623
2,516,177
2,516,177

Milbon Co., Ltd. (4919) Consolidated Financial Results for the Fiscal Year Ended December 20, 2013

Consolidated Statements of Comprehensive Income
Consolidated Fiscal Year Ended December 20, 2012 and 2013

Income before minority interests
Other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of the parent
Comprehensive income attributable to minority interests

Fiscal Year Ended
December 20, 2012
(December 21, 2011 December 20, 2012)
2,128,304(Thousand yen)
Fiscal Year Ended
December 20, 2013
(December 21, 2012 December 20, 2013)
2,516,177

77,260
14,11591,3762,219,681

406,802247,935
654,738
3,170,916

2,219,681-

3,170,916-- 10 -

Milbon Co., Ltd. (4919) Consolidated Financial Results for the Fiscal Year Ended December 20, 2013(3)

Consolidated Statements of Changes in Shareholders’ Equity
Fiscal Year Ended
December 20, 2012
(December 21, 2011December 20, 2012)

Shareholders’ equity
Capital stock
Balance at the beginning of current period
Changes of items during the period
Total changes of items during the period
Balance at the end of current period
Capital surplus
Balance at the beginning of current period
Changes of items during the period
Disposal of treasury stock
Total changes of items during the period
Balance at the end of current period
Retained earnings
Balance at the beginning of current period
Changes of items during the period
Dividends from surplus
Net income
Disposal of treasury stock
Total changes of items during the period
Balance at the end of current period
Treasury stock
Balance at the beginning of current period
Changes of items during the period
Purchase of treasury stock
Disposal of treasury stock
Total changes of items during the period
Balance at the end of current period
Total shareholders’ equity
Balance at the beginning of current period
Changes of items during the period
Dividends from surplus
Net income
Purchase of treasury stock
Disposal of treasury stock
Total changes of items during the period
Balance at the end of current period- 11 -(Thousand yen)
Fiscal Year Ended
December 20, 2013
(December 21, 2012 December 20, 2013)

2,000,000

2,000,000

2,000,000

2,000,000

199,120

199,120

199,12063
63
199,183

17,257,339

18,476,098(909,531)
2,128,304(14)
1,218,758
18,476,098(923,251)
2,516,177
1,592,926
20,069,024(48,652)(51,035)(2,481)98(2,382)(51,035)(466,492)
881(465,611)(516,646)

19,407,806

20,624,182(909,531)
2,128,304(2,481)84
1,216,376
20,624,182(923,251)
2,516,177(466,492)
944
1,127,378
21,751,561

Milbon Co., Ltd. (4919) Consolidated Financial Results for the Fiscal Year Ended December 20, 2013

Fiscal Year Ended
December 20, 2012
(December 21, 2011 December 20, 2012)
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Balance at the beginning of current period
Changes of items during the period
Net changes of items other than shareholders’ equity
Total changes of items during the period
Balance at the end of current period
Foreign currency translation adjustment
Balance at the beginning of current period
Changes of items during the period
Net changes of items other than shareholders’ equity
Total changes of items during the period
Balance at the end of current period
Total accumulated other comprehensive income
Balance at the beginning of current period
Changes of items during the period
Net changes of items other than shareholders’ equity
Total changes of items during the period
Balance at the end of current period
Total net assets
Balance at the beginning of current period
Changes of items during the period
Dividends from surplus
Net income
Purchase of treasury stock
Disposal of treasury stock
Net changes of items other than shareholders’ equity
Total changes of items during the period
Balance at the end of current period- 12 -(Thousand yen)
Fiscal Year Ended
December 20, 2013
(December 21, 2012 December 20, 2013)(206,624)(129,363)

77,26077,260(129,363)

406,802406,802277,439(141,609)(127,493)

14,115
14,115(127,493)

247,935
247,935
120,442(348,233)(256,856)

91,376
91,376(256,856)

654,738
654,738
397,881

19,059,573

20,367,325(909,531)
2,128,304(2,481)
84
91,376
1,307,752
20,367,325(923,251)
2,516,177(466,492)
944
654,738
1,782,117
22,149,443

Milbon Co., Ltd. (4919) Consolidated Financial Results for the Fiscal Year Ended December 20, 2013

(4)

Consolidated Statements of Cash Flows
Fiscal Year Ended
December 20, 2012
(December 21, 2011 December 20, 2012)

Net cash provided by (used in) operating activities
Income before income taxes and minority interests
Depreciation and amortization
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for sales returns
Increase (decrease) in provision for loss on guarantees
Increase (decrease) in provision for retirement benefits
Interest and dividends income
Foreign exchange losses (gains)
Loss (gain) on sales of noncurrent assets
Loss on retirement of noncurrent assets
Decrease (increase) in notes and accounts
receivable-trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable-trade
Other, net
SubtotalInterest and dividends income received
Income taxes paid
Net cash provided by (used in) operating activities
Net cash provided by (used in) investing activities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Payments of loans receivableCollection of loans receivable
Payments into time deposits
Proceeds from withdrawal of time deposits
Payments for guarantee deposits
Proceeds from collection of guarantee deposits
Purchase of insurance funds
Proceeds from cancellation of insurance funds
Other, net
Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities
Net decrease (increase) in treasury stock
Cash dividends paid
Net cash provided by (used in) financing activities- 13 -(Thousand yen)
Fiscal Year Ended
December 20, 2013
(December 21, 2012 December 20, 2013)

3,584,016
952,259
69,497
2,823(24,756)(37,200)
34,423(37,618)(2,208)
138,702

4,048,801
882,990(8,351)
12,1175,611
7,417(51,946)
5,460
(552)
11,40467,527(134,932)(86,089)
61,22025,067
4,747,665
35,463(1,805,740)
2,977,387(228,920)(29,381)289,933
4,809,652
52,752(1,350,905)
3,511,499(687,773)(176,386)(10,441)
18,957(424,418)(23,606)
3,623(201,486)(5,023)(1,506,555)(1,319,939)
1,859(153,837)(4,560)20,647(230,973)
514,505(34,269)
8,248(1,430)3,398(2,590)(1,198,939)(2,397)(908,333)(910,730)(465,548)(922,444)(1,387,992)

Milbon Co., Ltd. (4919) Consolidated Financial Results for the Fiscal Year Ended December 20, 2013

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

Fiscal Year Ended
December 20, 2012
(December 21, 2011 December 20, 2012)(3,160)556,9425,076,356
5,633,298- 14 -(Thousand yen)
Fiscal Year Ended
December 20, 2013
(December 21, 2012 December 20, 2013)
52,506
977,072
5,633,298
6,610,371