Flash Report for 2nd quarter Ended June 30, 2021
(on a consolidated basis) [Japan GAAP]
August 6, 2021
Name: Nakanishi Inc.

Stock listing: Tokyo Stock Exchange : JASDAQ

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: June 10, 2021
Scheduled date to begin dividend payments: September 29, 2021
Supplementary materials to quarterly financial statements: Not available
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, 2021)(1) Operating Results
Millions of yen
Net sales

Operating income

Ordinary income

1st quarter ended June 30, 2021

23,014

68.1%

7,646

219.6%

7,423

198.1%

1st quarter ended June 30, 2020

13,689-20.7%

2,392-40.7%

2,490-41.0%

Incomeattributable toowners of parent

Earnings per share(yen)

Diluted EPS (yen)

1st quarter ended June 30, 2021

5,366

188.7%

61.93

61.80

1st quarter ended June 30, 2020

1,858

-38.6%

21.45

21.41

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, 2021

6,191 million (366.0%)

2nd quarter ended June 30, 2020

1,328 million (-58.8%)(2) Financial Position
Millions of yen
Total assets

Net assets

Equity ratio

As of June 30, 2021

89,933

81,206

90.0%

As of December 31, 2020

82,47076,272

92.3%

Note: Owners’ equity As of June 30, 2021
As of December 31, 2020

80,970 million
76,080 million－ 1 －2. Dividends
Cash dividends per share (yen)
1st quarter
Year ended December 31, 2020—

Year ending December 31, 2021—

Year ending December 31, 2021
(forecast)
Notes:

1.

2nd quarter 3rd quarter

Year-end

Annual

15.00

—

15.00

30.00

17.00

—

17.00

34.00

Revisions to dividend payment forecasts during the period: Not applicable

3. Business Performance Forecasts for the Current Term (January 1 to December 31, 2021)
Millions of yen
IncomeNet sales
Full year

41,661

Notes:

Operatingattributable toincomeOrdinary income owners of parent

26.0% 13,001

52.2% 12,988

50.5%

9,338

1.

Percentage figures represent year-on-year comparisons.

2.

Revisions to performance forecasts during the period: Applicable

Earnings per

44.7%

share (yen)108.52

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.: Not 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, 2021:

94,259,400 shares

As of December 31, 2020:

94,259,400 shares

Number of shares of treasury stock at the end of the period
As of June 30, 2021:

7,602,686 shares

As of December 31, 2020:

7,602,642 shares

Average number of shares during the period
1st quarter ended June 30, 2021: 86,656,728 shares
1st quarter ended June 30, 2020: 86,650,727 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 Shareholders’ 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, many countries and areas have been doing proactive
financial and monetary activities so economy all over the world was trend to expand, especially in the
US and China. However uncertainty for future was increasing due to coronavirus re-pandemic.
In Japanese economy, some manufacturer were recovering but economic activities were very low,
especially food service industry and travel industry due to many times states of emergency.
Under these circumstances, in Dental product segment, which is our main segment, Domestic sales
increased dramatically thanks to subsidy from government etc. and other areas sales increased as well.
On the other hand, Selling, general and administrative expenses increased just a little because freightincreased but advertisement and travel expenses deceased.
As a result, the Group sales were ¥23,014,252 thousand (+68.1% year on year), operating income
was ¥7,646,660 thousand (+219.6%), ordinary income was \7,423,326 thousand (+198.1%) andincome attributable to owners of parent for the quarter was ¥5,366,930 thousand (+188.7%).
The following is a breakdown of business performance by segment.
（Dental Products）
In Dental Products, Domestic sales increased dramatically thanks to subsidy from government etc.,
and Europe, North America and Asia sales increased as well. Total dental sales increased. Segment
income increased as well.
As a result, sales were \ 20,530,928 thousand (+76.0%) and segment income was \ 9,013,945
thousand (+134.2 %).
（Industrial Products）
In Industrial Products, Asia sales increased dramatically. Domestic, Europe and North America sales
increased as well. Total industrial sales increased. Segment income increased as well.
As a result, sales were \ 1,699,932 thousand (+20.9%) and segment income was \ 633,125 thousand(+27.3%).
(Other Businesses)
In Other Businesses, which are repair services, sales were \783,391 thousand (+27.0%) and segment
income was \120,087 thousand (+123.5%).
(2) Explanation of Financial Position(Assets, liabilities and net asset)
Total assets at the end of 2nd quarter were \89,933,280 thousand and increased by \7,462,539
thousand compared with the end of the previous fiscal year. The main reasons were that Cash anddeposits increased by \6,461,052 thousand and Notes and accounts receivable - trade increased by¥633,035 thousand.
Total liabilities were \8,727,051 thousand and increased by \2,528,385 thousand compared with theend of the previous fiscal year. The main reason were Other in current liabilities increased by¥1,887,271 thousand and Accounts payable - trade increased by ¥377,587 thousand.
Net asset was \ 81,206,228 thousand and increased by \4,934,153 compared with the end of theprevious fiscal year. The main reason were that Retained earnings increased by ¥4,067,079 thousand
and Foreign currency translation adjustment ¥868,462 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¥36,104,863 thousand, up ¥6,060,092 thousand from the previous term-end.
Net cash provided by operating activities was ¥7,108,837 thousand, compared with ¥2,837,675
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 ¥7,440,099 thousand, which outweighed income taxes
paid of ¥2,027,066 thousand.
Net cash provided by investing activities was ¥-626,001 thousand, compared with ¥ 1,513,675
thousand a year earlier. The main expenditure were Purchase of investment securities \444,340
thousand and Purchase of tangible fixed assets ¥336,255 thousand. The main proceed was Proceedsfrom sales and redemption of investment securities ¥1,235,495 thousand.
Net cash provided used in financing activities was ¥-1,300,166 thousand, compared with ¥-1,386,324
thousand a year earlier. The main expenditure was Cash dividends paid ¥1,300,074 thousand.
(4)Explanation of Forecast of Consolidated Financial Results and Other Forward-Looking Information
Our company will revise our business performance forecasts it released on May 7, 2021.
The following table shows our forecasts of business performance for the fiscal year 2021.
Full year
The amount

%

Sales

\41,661 million

29.7

Operating income\13,001 million

52.2

Ordinary profit\12,988 million

50.5\9,338 million

44.7

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

－ 5 －2. Consolidated Quarterly Financial Statements and Principal Notes(1) Consolidated Quarterly Balance Sheets(Thousands of yen)
As of December 31, 2020
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 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 －As of June 30, 2021

32,238,337
5,158,047
1,433,277
4,129,321
4,487,638
3,506,289
2,610,225
870,939-90,537
54,343,539

38,699,390
5,791,083
1,490,880
4,340,410
4,756,859
3,364,318
2,382,725
819,468-69,422
61,575,714

15,302,136
6,681,859
4,970,635
1,989,815
219,356-14,273,115
14,890,687

15,405,439
7,010,579
5,136,448
2,023,320
241,371-15,051,102
14,766,058

346,531
373,414161,259
224,275
1,105,481

401,408
282,387
138,000
217,910
1,039,707

6,292,232
2,870,068
2,179,870
0145,102645,150-1,393
12,131,032
28,127,201
82,470,741

6,211,610
3,147,878
2,189,727
184
344,670
659,188-1,46012,551,800
28,357,566
89,933,280

(Thousands of yen)
As of December 31, 2020
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 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 －As of June 30, 2021

806,981
100,000
1,663,099
385,000
2,458,292
5,413,373

1,184,568
100,000
1,894,227
413,000
4,345,564
7,937,360

313,704
273,079
198,508785,292
6,198,665

310,020
283,964
195,706
789,6908,727,051

867,948
1,180,482
77,435,739-5,593,711
73,890,460

867,948
1,180,482
81,502,819-5,593,803
77,957,446

2,284,166

2,239,129-94,595

773,867

2,189,571

3,012,997

189,688
2,355
76,272,075
82,470,741

232,552
3,231
81,206,228
89,933,280

(2) Consolidated Quarterly Statements of Income and Comprehensive Income(Consolidated Quarterly Statements of Income)(Thousands of yen)Six months ended
June 30, 2020
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
Miscellaneous income
Total non-operating income
Non-operating expenses
Interest expenses
Loss on investments in money held in trust
Foreign exchange losses
Miscellaneous loss
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Total extraordinary income
Extraordinary losses
Loss on sales 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, 2021

13,689,797
5,843,702
7,846,094
5,453,430
2,392,664

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

59,67623,857－31,01837,01526,441
134,427
32,133－

199,717

91,566
206,118

55,345
485,080

1,026
61,66428,701
17,216108,6082,490,173

1,771－
699,385
7,257
708,414
7,423,326

1,047
－
1,047

－
17,087
17,08748484
533
2,490,687
759,827-128,228
631,598
1,859,088
221
1,858,867

－
313
313
7,440,099
2,253,848-181,241
2,072,606
5,367,493
562
5,366,930

(Consolidated Quarterly Statements of Comprehensive Income)(Thousands of yen)Six months ended
June 30, 2020
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 to noncontrolling interests－ 9 －Six months ended
June 30, 2021

1,859,088

5,367,493-186,233-45,036-344,323-530,556
1,328,532

868,776
823,740
6,191,233

1,329,011

6,190,356

-479

876

(3) Consolidated Statements of Cash Flows(Thousands of yen)Six months ended
June 30, 2020
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 sales of investment securities
Loss on retirement of non-current assets
Loss (gain) on sales 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
Proceeds from sales and redemption of
securities
Purchase of property, plant and equipment
Proceeds from sales of property, plant andequipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from sales and redemption of
investment securities
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of insurance funds
Other, net
Net cash provided by (used in) investing
activities
Cash flows from financing activities
Dividends paid
Proceeds from exercise of subscription rights
to shares
Purchase of treasury shares
Net cash provided by (used in) financing
activities－ 10 －

Six months ended
June 30, 2021

2,490,687
838,223
23,9827,440,099
853,028
27,302-3,156-24,488

12,10028,000-8,204-8,065-83,534
1,026-63,457
1,771－-199,717

－
484
-998

-17,087
313－

61,664-134,427-31,018
1,032,047-1,033,772
162,012
42,104-183,904
3,319,745
81,357-1,053-593,391
31,018-32,133-450,832
321,737
157,058-761,239
1,800,793
8,938,655
166,918-1,802-2,027,066
32,133

2,837,675

7,108,837

133,703－-530,640-336,255

1,047－-162,570－-109,966-444,340

336,480

551,101-2,530,273
4,268,699-15,761
12,991-2,888,263
2,603,446-6,741
5,018

1,513,675-626,001-1,386,336-1,300,074

12

－

－

-92

-1,386,324-1,300,166

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 －-133,099

877,422

2,831,926

6,060,092

24,669,800

30,044,771

27,501,727

36,104,863

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

－ 12 －

(Segment Information）【Segment Information】
1st quarter ended June 31, 2020 (From January 1, 2020 to June 31, 2020)(Thousands of yen)Per

Reportable segments
DentalIndustrial

products

products

OthersReportablesegments

Reconciling
items

quarterly
consolidated financial
statements

Sales
Revenues
fromexternal

11,666,846

1,406,233

616,717

13,689,797－

13,689,797

－

－

－

－

－

－

11,666,846

1,406,233

616,717

13,689,797－

13,689,797

3,848,230

497,31053,727

4,399,268-2,006,604

2,392,664

customers
Transactions
with othersegments
Net sales
Operatingprofit (loss)

Notes:

1.

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

2.

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

－ 13 －

1st quarter ended June 31, 2021 (From January 1, 2021 to June 31, 2021)(Thousands of yen)Per

Reportable segments
DentalIndustrial

products

products

OthersReportablesegments

Reconciling
items

quarterly
consolidated financial
statements

Sales
Revenues
fromexternal

20,530,928

1,699,932

783,391

23,014,252－

23,014,252

－

－

－

－

－

－

20,530,928

1,699,932

783,391

23,014,252－

23,014,252

9,013,945

633,125

120,087

9,767,158△2,120,497

7,646,660

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

1.

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

2.

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

－ 14 －