Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2023
(Japanese GAAP)

August 10, 2023
Company name: Nishimoto Co., Ltd.
Listed exchange: Tokyo
Code:
9260
URL: http://www.wismettac.com/
Representative:
Yoshiro Susaki, Chairman & CEO
Contact:
Yuji Sasa, President, Director, Executive Officer, COO, CFO(Phone) 03-6870-2015
Scheduled date of filing of quarterly report:
August 14, 2023
Scheduled date of commencement of dividend payments:
September 19, 2023
Preparation of supplementary materials for quarterly financial results: Yes
Holding of quarterly financial results presentation meeting:Yes (For institutional investors and analysts)(Amounts are rounded down to the nearest million yen)

1.

Consolidated financial results for the second quarter of the fiscal year ending December 31, 2023
(from January 1, 2023 to June 30, 2023)(1) Consolidated results of operations (cumulative)
Net sales
Million yen(Percentages denote year-on-year changes)
Profit attributable toOrdinary income
owners of parent

Operating income%

Million yen%

Million yen

Second quarter of FY ending
146,281
11.9
5,737
(5.2)
6,453
December 31, 2023
Second quarter of FY ended
130,742
30.9
6,051
84.7
6,441
December 31, 2022
(Note) Comprehensive income
Second quarter of FY ending December 31, 2023: 10,925 million yen (-23.1%)
Second quarter of FY ended December 31, 2022: 14,206 million yen (155.8%)
Diluted net income
Net income per shareper share
Second quarter of FY ending
December 31, 2023
Second quarter of FY ended
December 31, 2022

Yen

Yen

305.07303.01

313.84312.75%

Million yen

%

0.2

4,378

(2.8)

93.2

4,504

74.1

(2) Consolidated financial position
Total assets

Net assets

Million yen

Equity ratio

Million yen%

As of June 30, 2023
193,763
81,005(FY 2023 2Q)
As of December 31, 2022
179,22272,063(FY 2022)(Reference)
Shareholders’ equity
Second quarter of FY ending December 31, 2023: 80,982 million yen
FY ended December 31, 2022:
71,559 million yen

2.

41.8
39.9

Dividends
Annual dividends
First quarter-end

FY ended December 31, 2022
FY ending December 31, 2023
FY ending December 31, 2023
(Forecast)(Note)

Secondquarter-end

Third quarter-end

Year-end

Total

Yen

Yen

Yen

Yen

Yen

—
—

70.00
80.00

—

75.00

145.00—80.00

160.00

Revision to the forecast for dividends announced most recently: None

3.

Consolidated financial results forecast for the fiscal year ending December 31, 2023
(from January 1, 2023 to December 31, 2023)
Net sales
Million yen%

Million yen%

Million yen%

Million yen%

Yen

304,000

10.5

12,00014.3

12,500

15.9

7,500

10.0

522.54

FY ending December
31, 2023(Note)

Operating income(Percentages denote year-on-year changes)
Profit attributable to Net income per
Ordinary income
owners of parent
share

Revision to the forecast for financial results announced most recently: Yes
For details, please refer to the “Notice Regarding Revision of Consolidated Earnings Forecasts for the Fiscal Year Ending December 2023,
and Dividend of Surplus (Interim Dividend)” announced today.

* Notes(1) Changes in significant subsidiaries during the first six months of the fiscal year:(Changes in specified subsidiaries resulting in changes in the scope of consolidation)
New 1 company(Company name) Wismettac EMEA Holdings Limited
Excluded — companies(Note)Yes(Company name) —For details, please see the section titled "(4) Notes to the quarterly consolidated financial statements (Changes in significant subsidiaries
during the first six months of the fiscal year)" under the chapter titled "2. Quarterly consolidated financial statements and major notes" on thepage 10 of the attachment.

(2) Application of accounting treatment specific to the preparation of quarterly consolidated
financial statements:(3) Changes in accounting policies, changes to accounting estimates, and restatements(i)
Changes in accounting policies due to revisions of accounting standards:

Yes

Yes

(ii)

Changes in accounting policies other than (i) above:

None

(iii)

Changes in accounting estimates:

None

(iv)

Restatements:

None(4) Number of shares outstanding (common stock)(i)
Number of shares outstanding at the endof the period (including treasury shares)(ii)
Number of treasury shares at the end of
the period(iii) Average number of shares during theperiod (six months ended June 30, 2023)

As of June 30,
2023

14,353,140 shares

December 31,
2022

14,353,140 shares

As of June 30,2023

241 shares

December 31,
2022

220 shares

As of June 30,
2023

14,352,917 shares

June 30, 2022

14,352,980 shares* These quarterly financial results are not subject to quarterly review procedures.
* Explanation of the proper use of financial results forecasts and other notes(Cautionary note on forward-looking statements, etc.)
The forward-looking statements such as financial results forecasts contained in this document are based on information currently
available to the Company and certain reasonable assumptions. Thus, these statements are not intended for management to promise theachievement of the forecast. Actual financial results may differ materially due to various factors. For conditions of the assumptions in
the forecast and notes to use of the forecast, please see the section titled “(3) Explanation of future forecasts such as consolidated
financial results forecasts” under the chapter titled “1. Qualitative information on quarterly financial results” on the page 4 of theattachment.
(How to obtain the quarterly financial results supplementary materials)
The quarterly financial results supplementary materials will be disclosed on TDnet on August 10, 2023 and will also be posted on the
Company’s website. The Company plans to hold a briefing meeting on the financial results for institutional investors and analysts on
August 17, 2023, based on these materials.

Nishimoto Co., Ltd. - Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2023

 Attachment: Table of Contents

1. Qualitative information on quarterly financial results .............................................................................................. 2(1) Explanation of operating results ........................................................................................................................ 2(2) Explanation of financial position ....................................................................................................................... 4(3) Explanation of future forecasts such as consolidated financial results forecasts ................................................ 5
2. Quarterly consolidated financial statements and major notes .................................................................................. 6(1) Quarterly consolidated balance sheet ................................................................................................................. 6(2) Quarterly consolidated statements of income and comprehensive income ........................................................ 8(3) Quarterly consolidated statement of cash flows ............................................................................................... 10(4) Notes to the quarterly consolidated financial statements ................................................................................. 11(Notes to assumption of going concern) .......................................................................................................... 11(Notes on significant changes in shareholders’ equity) .................................................................................... 11(Application of an accounting treatment specific to the preparation of quarterly consolidated financial
statements) ....................................................................................................................................................... 11(Changes in accounting policy) ....................................................................................................................... 11(Changes in significant subsidiaries during the first six months of the fiscal year) ......................................... 11(Additional information) .................................................................................................................................. 11(Segment information) ..................................................................................................................................... 12(Significant subsequent events) ....................................................................................................................... 13– 1 –Nishimoto Co., Ltd. - Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2023

1. Qualitative information on quarterly financial results(1) Explanation of operating results
Forward-looking statements in the document are based on the judgment of the Company Group as of the end of the second
quarter of the current consolidated fiscal year.
[Outline of the second quarter of the current consolidated fiscal year]
During the first six months of the current fiscal year, uncertainty about the global economic outlook has increased due to thematerialization of various events that have an impact on inflation and economic growth, such as economic malaise, theprotracted situation in Ukraine, and abnormal weather around the world, in addition to ongoing monetary tightening against
inflation.
Under these circumstances, our Company Group, as a global food-related company, has been striving to deliver products safely
and stably while responding to various changing business environments. The main businesses of the Company Group are the
Asian Food Global Business, which sells Japanese and other Asian foods and food ingredients mainly in North America, butalso in Europe, China, Southeast Asia, Australia, etc., and the Agricultural & Seafood Products Trading Business, which
engages in domestic sales of fruits and vegetables, as well as export and trilateral trade. We are also engaged in the business ofselling overseas branded food products, seasonal products planned and developed in-house, and character products to imported
food stores and general merchandise stores in Japan, as well as the business of manufacturing and selling natural supplements.
In addition, we aim to become a company that identifies and provides solutions to various issues facing the food industry, bydeveloping businesses in new areas where ‘food’ and ‘healthcare’ converge, and providing solutions using digital technology
for companies involved in the food industry.
In the Asian Food Global Business, we have aggressively pursued structural reforms to achieve sustainable and stable earnings
in our core region of North America and to expand our operating base outside North America, which is one of our growthstrategies. In the Agricultural & Seafood Products Trading Business, the Company Group has been working to expand sales to
its mainstay wholesale markets, mass retailers, home-meal replacement industries, and restaurant chains, etc., while also
developing overseas distribution routes, including export of domestic fruits and vegetables, offshore trading, and the wholesale
business in China.
As a result, with respect to the financial results for the second quarter of the current consolidated fiscal year, net sales stood at
146,281 million yen (11.9% increase year-on-year), operating income amounted to 5,737 million yen (5.2% decrease year-onyear), ordinary income amounted to 6,453 million yen (0.2% increase year-on-year), and profit attributable to owners of parent
totaled 4,378 million yen (2.8% decrease year-on-year).
Financial results by segment are as follows: It is noted that net sales of segments are net sales to external customers.
[Outline of operating results by segment](i) Asian Food Global BusinessIn the Asian Food Global Business, for the second quarter of the current consolidated fiscal year, the Company had net
sales of 113,462 million yen (13.0% increase year-on-year) and operating income of 6,738 million yen (2.7% increaseyear-on-year).
In the North America region, net sales increased from the same period of the previous year both in the restaurant andgrocery markets with robust sales. The expansion of sales to major grocery chains, the promotion of switching fromnational brands to private labels, and sales activities focused on market share retention have been successful.
In terms of profit, the company endeavored to maintain the profit margin through appropriate price pass-through and othermeasures. However, due to increased expenses resulting from salary adjustments to retain human resources and broad-based
price increases, the profit margin declined from the same period last year when it was at a higher level than in the past on
the back of product shortages caused by global logistics disruptions.
Outside of North America, although the economy was sluggish in Europe due to the continuation of inflation and rate
hikes, net sales increased from the same period of the previous year mainly driven by sales to chain restaurants. As
detailed in 2. Quarterly consolidated financial statements and major notes (4) Notes to the quarterly consolidated financial
statements (Additional information), the Company plans to acquire all shares of Uniontrade S.p.A. and Uni Logistic S.r.l.,which are headquartered in Italy, on October 31, 2023. In the Asia and Oceania region, the performance in the same periodof the previous year was affected by the spread of COVID-19 variants and deteriorating supply chains, but the economy
continued to grow moderately this year despite ongoing inflation and rate hikes similar to those in the U.S. and Europe,and net sales increased from the same period of the previous year.

– 2 –Nishimoto Co., Ltd. - Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2023(ii) Agricultural & Seafood Products Trading BusinessIn the Agricultural & Seafood Products Trading Business, for the second quarter of the current consolidated fiscal year, theCompany had net sales of 30,947 million yen (8.1% increase year-on-year) and operating losses of 93 million yen(operating losses of 138 million yen in the same period of the previous year).
Net sales increased from the same period of the previous year mainly due to relatively steady shipment for both imported
fruits and vegetables and frozen processed food.
In terms of profit, while lowering selling prices of lemons, our mainstay products, under a sales policy that prioritizes sales
volume during the first half of the period under review, we passed on higher costs to selling prices of other imported fruits
and vegetables and frozen processed food. As a result, profits increased from the same period of the previous year.
(iii) Other businesses
In other businesses, for the second quarter of the current consolidated fiscal year, the Company had net sales of 1,871
million yen (11.0% increase year-on-year) and operating losses of 94 million yen (operating losses of 119 million yen in
the same period of the previous year).
In the mainstay imported food business, the Valentine’s Day event, which is our biggest sales event, was a success, and both
net sales and profits increased steadily in the first half of the period under review. In the second half, daily imported branded
products performed well despite the effect of inflation, while sales of dietary supplements grew steadily, mainly through thecore medical channel and EC. We also developed new businesses, such as the provision of food for people recovering fromsurgery or illness, which incurred start-up costs. However, the other businesses as a whole achieved growth in both sales
and profits.

– 3 –Nishimoto Co., Ltd. - Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2023

(2) Explanation of financial position
1. Assets, liabilities and net assets(Assets)
Total assets as of June 30, 2023 stood at 193,763 million yen, an increase of 14,540 million yen compared to December 31,
2022, and was mainly attributable to the following.
Total current assets as of June 30, 2023 amounted to 164,178 million yen, an increase of 13,147 million yen compared to
December 31, 2022. The increase in total current assets was due to an increase of 9,142 million yen in cash and deposits
and an increase of 2,926 million yen in notes and accounts receivable—trade.
Total non-current assets as of June 30, 2023 amounted to 29,585 million yen, an increase of 1,393 million yen compared
to December 31, 2022. The increase in total non-current assets was due to an increase of 424 million yen in other, net,
including construction in progress, and an increase of 321 million yen in software.
(Liabilities)
Total liabilities as of June 30, 2023 stood at 112,758 million yen, an increase of 5,599 million yen compared to December
31, 2022, and was mainly attributable to the following.
Total current liabilities as of June 30, 2023 amounted to 36,438 million yen, an increase of 2,825 million yen compared to
December 31, 2022. The increase in total current liabilities was due to an increase of 2,126 million yen in notes andaccounts payable—trade, an increase of 607 million yen in other, including accrued expenses, despite a decrease of 457
million yen in provision for bonuses.
Total non-current liabilities as of June 30, 2023 amounted to 76,319 million yen, an increase of 2,773 million yen
compared to December 31, 2022. The increase in total non-current liabilities was due to an increase of 2,597 million yen
in long-term loans payable.
(Net assets)
Total net assets as of June 30, 2023 amounted to 81,005 million yen, an increase of 8,941 million yen compared to
December 31, 2022. The increase in total net assets was mainly due to an increase of 6,431 million yen in foreign currencytranslation adjustment and an increase of 3,302 million yen in retained earnings.

2. Cash flows
Cash and cash equivalents (hereinafter referred to as “Funds”) for the first six months of the current consolidated fiscal year
stood at 84,930 million yen, an increase of 9,142 million yen compared to December 31, 2022.
Cash flows for the first six months of the current consolidated fiscal year and the main factors affecting them are as follows.
(Cash flows from operating activities)
Cash flows from operating activities were positive at 9,004 million yen. This was mainly attributable to profit before
income taxes of 6,347 million yen, a decrease of 2,091 million yen in inventories, and depreciation and amortization of
1,376 million yen, which are non-cash expenses, despite income taxes paid of 1,618 million yen.
Cash inflows increased by 17,944 million yen compared to the same period of the previous consolidated fiscal year (cashoutflows of 8,939 million yen in the same period of the previous year). This was mainly due to an increase of 13,777
million yen in cash inflow from a change in inventories and a decrease of 1,427 million yen in cash outflow for a change
in notes and accounts payable—trade.
(Cash flows from investing activities)
Cash flows from investing activities were negative at 824 million yen. This was mainly attributable to a cash outflow of
495 million yen for the purchase of property, plant and equipment and a cash outflow of 252 million yen for the purchaseof intangible assets.
Cash outflows decreased by 1,813 million yen compared to the same period of the previous consolidated fiscal year (a68.7% decrease in cash outflows from the same period of the previous year). This was mainly due to the absence of a cash
outflow of 2,043 million yen for the purchase of shares of subsidiaries resulting in a change in the scope of consolidationthat arose in the same period of the previous year.
(Cash flows from financing activities)
Cash flows from financial activities were negative at 2,568 million yen. This was mainly attributable to a cash outflow of
1,076 million yen for cash dividends paid, a cash outflow of 907 million yen for the purchase of shares of subsidiaries not– 4 –Nishimoto Co., Ltd. - Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2023

resulting in change in scope of consolidation, and a cash outflow of 843 million yen for net increase (decrease) in shortterm borrowings, despite a cash inflow of 881 million yen from proceeds from long-term borrowings.
Cash outflows increased by 2,185 million yen compared to the same period of the previous consolidated fiscal year (up570.2% year on year). This was mainly due to a decrease of 2,760 million yen in cash inflow from net increase (decrease)in short-term borrowings, a decrease of 1,368 million yen in proceeds from long-term borrowings, and an increase of 907
million yen in cash outflow for the purchase of shares of subsidiaries not resulting in a change in the scope of
consolidation, despite a decrease of 2,951 million yen in cash outflow for repayments of long-term borrowings.

(3) Explanation of future forecasts such as consolidated financial results forecasts
In view of the earnings results for the first six months of the current fiscal year, the profit-boosting impact of continued
depreciation of the yen, and the impact of higher interest rates on the financial position of the Company, among other things,
we have revised our annual consolidated earnings forecasts, which were previously announced on February 14, 2023, upward.
For details, refer to the “Notice Regarding Revision of Consolidated Earnings Forecasts for the Fiscal Year Ending December
2023, and Revision of Dividend of Surplus (Interim Dividend)” announced today.

– 5 –Nishimoto Co., Ltd. - Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2023

2. Quarterly consolidated financial statements and major notes(1) Quarterly consolidated balance sheet
FY 2022(As of December 31, 2022)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable—trade
Inventories
Other
Allowance for doubtful accounts(Millions of yen)
Second quarter of FY 2023
(As of June 30, 2023)

75,78729,31742,584
3,765(423)

84,93032,24443,8833,565(444)

151,030

164,178

Non-current assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
Tools, furniture and fixtures, net
Leased assets, net
Other, net

2,839
462
325
11,198
252

2,853
439
352
11,152676

Total property, plant and equipment

Total current assets

15,07915,474

Intangible assets
Goodwill
Software
Software in progress
Customer-related assets
Other

4,546
326
1,221
4,754
51

4,772
648
1,216
5,000
49

Total intangible assets

10,899

11,686

Investments and other assets
Investment securities
Guarantee deposits
Deferred tax assets
Other

392
967
703
149

561
963
766
132

2,213

2,423

Total investments and other assets
Total non-current assets
Total assets– 6 –28,191

29,585

179,222

193,763

Nishimoto Co., Ltd. - Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2023

FY 2022(As of December 31, 2022)
Liabilities
Current liabilities
Notes and accounts payable—trade
Short-term loans payable
Current portion of long-term loans payable
Lease obligations
Accounts payable—other
Income taxes payable
Provision for bonuses
Provision for directors’ bonuses
Provision for share-based remuneration
Provision for shareholders’ benefits
Other
Total current liabilities
Non-current liabilities
Long-term loans payable
Lease obligations
Deferred tax liabilities
Provision for bonuses
Provision for share-based remuneration
Net defined benefit liability
Other
Total non-current liabilities(Millions of yen)
Second quarter of FY 2023
(As of June 30, 2023)

15,171
6,528
448
2,479
3,518
213
1,427
142
23
3,660

17,297
6,272
410
2,656
3,854
368
969
75
259
4
4,268

33,61336,43860,573
9,250
1,197
86
455
129
1,853

63,171
9,081
1,317
40
575
105
2,028

73,54576,319Total liabilities

107,158

112,758

Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury shares

2,646
6,531
52,435
(0)

2,646
6,145
55,737(1)

61,61264,528

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment

Total shareholders’ equity

15
(43)
9,975

21
25
16,406

Total accumulated other comprehensive income

9,947

16,453

Non-controlling interests
Total net assets
Total liabilities and net assets

– 7 –

504

23

72,06381,005

179,222

193,763

Nishimoto Co., Ltd. - Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2023

(2) Quarterly consolidated statements of income and comprehensive income
Quarterly consolidated statement of income
First six months ended June 30, 2023
(Millions of yen)First six months of FY 2023
(January 1, 2023
to June 30, 2023)
146,281
116,457

Net sales
Cost of sales

First six months of FY 2022
(January 1, 2022
to June 30, 2022)
130,742
104,075

Gross profit

26,667

29,824

Selling, general and administrative expenses

20,61624,087

Operating income

6,051

5,737

61

838

42

27

0
494
3
49

0
237
4
79

651

1,187

256
4

460
11

Non-operating income
Interest and dividend income
Share of profit of entities accounted for using equity
methodInsurance benefits received
Foreign exchange gains
Reversal of allowance for doubtful accounts
Other
Total non-operating income
Non-operating expenses
Interest expenses
Other
Total non-operating expenses

261

471

6,441

6,453

-

-

Business restructuring expenses-

105

Total extraordinary losses-

105

Profit before income taxes

6,441

6,347

Income taxes—current
Income taxes—deferred

1,950
(29)

1,970
(13)

Total income taxes

1,921

1,956

Net income

4,520

4,390

Ordinary income
Extraordinary income
Total extraordinary income
Extraordinary losses

Profit attributable to non-controlling interests
Profit attributable to owners of parent

– 8 –

15

11

4,504

4,378

Nishimoto Co., Ltd. - Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2023

Quarterly consolidated statement of comprehensive income
First six months ended June 30, 2023

Net income
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Share of other comprehensive income of entities
accounted for using equity method

First six months of FY 2022
(January 1, 2022
to June 30, 2022)
4,520(Millions of yen)First six months of FY 2023
(January 1, 2023
to June 30, 2023)
4,390

1
45
9,601

5
69
6,429

37

30

Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests

– 9 –

9,686

6,535

14,206

10,925

14,15010,88556

40

Nishimoto Co., Ltd. - Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2023

(3) Quarterly consolidated statement of cash flows
First six months of FY 2022
(January 1, 2022
to June 30, 2022)
Cash flows from operating activities
Profit before income taxes
Depreciation and amortization
Increase (decrease) in allowance for doubtful accounts
Interest and dividend income
Interest expenses
Share of (profit) loss of entities accounted for using
equity method
Foreign exchange losses (gains)
Decrease (increase) in notes and accounts
receivable—trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable—
trade
Increase (decrease) in accounts payable—other
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for directors’ bonuses
Increase (decrease) in provision for shareholder
privilege program
Increase (decrease) in provision for share-based
payments
Increase (decrease) in net defined benefit liability
Other
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes paid
Income taxes reimbursed
Cash flows from operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Purchase of intangible assets
Payments for acquiring shares of subsidiaries
resulting in changes in the scope of consolidation
Other
Cash flows from investing activities
Cash flows from financing activities
Net increase (decrease) in short-term loans payable
Income from long-term loans payable
Repayments of long-term loans payable
Purchase of treasury shares
Repayments of finance lease obligations
Cash dividends paid
Purchase of shares of subsidiaries not resulting in achange in the scope of consolidation
Cash flows from financing activities
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
Closing balance of cash and cash equivalents– 10 –(Millions of yen)First six months of FY 2023
(January 1, 2023
to June 30, 2023)

6,441
1,307
(38)
(61)
256

6,347
1,376
(14)
(838)
460

(42)

(27)

242

97

(2,154)(727)(11,686)

2,091

441

905

348
(565)
(108)

29
(583)
(71)

(10)

(18)

157

354

(12)
(1,355)(6,840)62(240)(2,055)135(8,939)(27)
843
10,197836(456)(1,618)
46
9,004

(151)
(425)

(495)
(252)

(2,043)—(16)(2,637)

(76)
(824)

1,917
2,250
(3,292)(0)(253)(1,004)

(843)
881
(341)
(0)
(281)
(1,076)

—

(907)

(383)
4,561
(7,398)65,64758,248(2,568)3,530
9,142
75,78784,930Nishimoto Co., Ltd. - Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2023

(4) Notes to the quarterly consolidated financial statements(Notes to assumption of going concern)
No relevant items.
(Notes on significant changes in shareholders’ equity)
No relevant items.
(Application of an accounting treatment specific to the preparation of quarterly consolidated financial statements)
Calculation of tax expenses
The tax expenses of some of non-Japan consolidated subsidiaries were calculated by multiplying net income before taxes by aneffective tax rate, which was estimated as the rate after the application of tax effect accounting to net income before taxes forthe fiscal year including the second quarter of the fiscal year.
(Changes in accounting policy)(Application of International Accounting Standard IAS 12—Income taxes)
With effect from the beginning of the first quarter of the current consolidated fiscal year, the Company Group’s foreign
consolidated subsidiaries that apply International Financial Reporting Standards have adopted International AccountingStandard IAS 12—Income Taxes (as revised in May 2021; hereafter referred to as “the standard” in this section). Accordingly,
deferred tax assets relating to leased and abandoned assets are recognized.
The change in accounting policy has been applied retrospectively, and the quarterly consolidated financial statements andconsolidated financial statements for the previous fiscal year have been retrospectively applied, and the cumulative effect has
been reflected in net assets at the beginning of the previous consolidated fiscal year.
The application of the standard did not have a material impact on the quarterly consolidated financial statements.
(Application of US GAAP ASU No. 2016-13 Financial Instruments—Credit Losses)
With effect from the beginning of the first quarter of the current consolidated fiscal year, the Company Group’s foreign
consolidated subsidiaries that apply US GAAP have adopted ASU No. 2016-13, Financial Instruments—Credit Losses(hereafter referred to as “the standard” in this section). Accordingly, impairment losses on financial assets are recognized basedon the expected credit loss model.
In applying this standard, the cumulative effect of adopting this standard, which is permitted as a transitional measure, isrecognized at the date of adoption and the effect is added to or deducted from retained earnings at the beginning of the firstquarter of the current fiscal year.
The application of the standard did not have a material impact on the quarterly consolidated financial statements.
(Changes in significant subsidiaries during the first six months of the fiscal year)
Wismettac EMEA Holdings Limited is included in the scope of consolidation from the first quarter of the current fiscal year,
because it has become a consolidated subsidiary due to its incorporation.
(Additional information)(Accounting estimate associated with the novel coronavirus pandemic)
There have been no significant changes in the assumptions regarding the impact of the COVID-19 pandemic, which were
described under Additional information—Accounting estimate associated with the novel coronavirus pandemic in theConsolidated Financial Results for the Fiscal Year Ended December 31, 2022.
(Acquisition of companies through the acquisition of shares)
The Company resolved, at the meeting of its Board of Directors held on June 12, 2023, to acquire 100% of the shares ofUniontrade S.p.A. (head office: Italy; “UT”) and Uni Logistic S.r.l. (head office: Italy; “UL”) through Wismettac Harro Foods
Limited, a consolidated subsidiary of the Company, and to convert the two companies into its subsidiaries (sub-subsidiaries of
the Company). On June 30, 2023, the Company entered into a share transfer agreement.
Based on the agreement, the Company plans to acquire 100% of shares of UT and UL on October 31, 2023, the execution dateof the share transfer.

– 11 –

Nishimoto Co., Ltd. - Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2023

(1) Names of the acquired companies and their business
Name of the acquired company:

Uniontrade S.p.A.

Business:

Wholesale business of Japanese and other Asian food products and operation of cash andcarry

Name of the acquired company:

Uni Logistic S.r.l.

Business:

Provision of logistics services to UT and its subsidiary Plaza Latina S.r.l.

(2) Purpose of acquiring the shares
The Company, as part of its Asian Food Global Business in the European region, conducts the import and wholesale ofJapanese and other Asian food products mainly in the U.K., Germany, and France. The Company has resolved to acquire
100% of the shares of UT, which conducts a wholesale business for Japanese and other Asian food products in Italy, and100% of the shares of UL, which performs certain logistics functions of UT, making them sub-subsidiaries of the Company.
There are three operating companies in total, including UT as a core company, all of which will become sub-subsidiaries of
the Company. Wismettac Harro Foods Limited is expected to be the company acquiring the shares, but the purchasing
company will be finalized by the execution date of the share transfer. From a strategic perspective, the warehouses and otherfacilities owned and rented by UT will be spun off by the share transfer date and rented by UT after the share acquisition.
UT is one of the leading wholesalers of Japanese and other Asian food products in Italy. Based on its long-standing business
relationships with restaurants and retailers, UT sells food products and ingredients such as seafood, rice, and seasonings, andis also engaged in the cash and carry (purchasing and taking out goods from a warehouse) of commercial food products forrestaurants. The Company plans to leverage the Wismettac Group’s product lineup to offer a wider range of value-added
products to its customers.
One of the growth strategies of the Group’s Asian Food Global Business is to expand our business foundation outside ofNorth America. We have been developing the business foundation of our Asian Food Global Business with a focus on
Japanese food in Europe by converting our business bases in major countries such as the U.K., Germany, and France into
group companies, and now we will establish a sales channel in the Italian market through UT.
(3) Share acquisition date
October 31, 2023 (scheduled)(4) Percentage of voting rights to be acquired
UT: 100%
UL: 100%(Segment information)
I. First six months of the fiscal year (from January 1, 2022 to June 30, 2022)
1.

Information related to net sales and profits/losses by reporting segment and decomposition of income(Millions of yen)
Reporting segment
Agricultural &Asian Food
Seafood Products Other business
Global BusinessTrading BusinessNet sales
Japan
North America
EuropeOther
Revenue from contracts withcustomers
Sales to external customers
Intersegment sales or transfers
Total
Segment profit or loss

Total

Adjustment(Note 1)

Amounts recordedin the quarterly
consolidated
statement of income(Note 2)

3,691
72,373
19,117
5,244

23,492
–
–
5,137

1,685
–
–
–

28,86972,373
19,117
10,382––––

28,86972,373
19,117
10,382

100,426

28,6301,685

130,742–

130,742

100,426
5,171
105,597
6,560

28,630028,630
(138)

1,685
–
1,685
(119)

130,742
5,171
135,914
6,301–(5,171)(5,171)(250)

130,742–
130,742
6,051– 12 –

Nishimoto Co., Ltd. - Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending December 31, 2023

(Note) 1. “Adjustment” for segment profit or loss in the amount of (250) million yen includes 0 million yen for elimination ofintersegment transactions and (250) million yen for company profit/loss not allotted to reporting segments (netcompany profits and net company expenses). Company profits consist mainly of management guidance fees from
reporting segments, and company expenses mainly comprise general and administrative expenses not attributed toreporting segments.
2. The segment profit or loss is reconciled with the operating income on the Quarterly Consolidated Statement of Income.
2.

Information related to impairment loss of non-current assets and goodwill by reporting segment(Material fluctuation in goodwill)In the Agricultural & Seafood Products Trading Business segment, the Company acquired 100% of shares of Ban Choon
Marketing Pte. Ltd., making it a consolidated subsidiary. This increase in goodwill attributable to this event was 1,616 million
yen in the second quarter of the previous consolidated fiscal year. The goodwill is an amount calculated provisionally because
the acquisition cost is not fully distributed at the end of the second quarter of the previous consolidated fiscal year.

II. First six months of the fiscal year (from January 1, 2023 to June 30, 2023)
1.

Information related to net sales and profits/losses by reporting segment and decomposition of income(Millions of yen)
Reporting segment
Agricultural &Asian Food
Seafood Products Other business
Global BusinessTrading BusinessNet sales
Japan
North America
EuropeOther
Revenue from contracts withcustomers
Sales to external customers
Intersegment sales or transfers
Total
Segment profit or loss

Total

Adjustment(Note 1)

Amounts recordedin the quarterly
consolidated
statement of income(Note 2)

3,631
81,705
21,6956,430

25,444
–
–
5,503

1,871
–
–
–

30,947
81,705
21,695
11,933––––30,947
81,705
21,695
11,933

113,462

30,947

1,871

146,281–

146,281

113,462
535
113,998
6,738

30,947–30,947
(93)

1,871
38
1,909
(94)

146,281574
146,856
6,550

–
(574)
(574)
(812)

146,281–
146,2815,737(Note) 1. “Adjustment” for segment profit or loss in the amount of (812) million yen includes 0 million yen for elimination ofintersegment transactions and (812) million yen for company profit/loss not allotted to reporting segments (netcompany profits and net company expenses). Company profits consist mainly of management guidance fees from
reporting segments, and company expenses mainly comprise general and administrative expenses not attributed toreporting segments.
2. The segment profit or loss is reconciled with the operating income on the Quarterly Consolidated Statement of Income.
2.

Information related to impairment loss of non-current assets and goodwill by reporting segment
No relevant items.
(Significant subsequent events)(Borrowing of funds)
The Company has borrowed funds as follows in accordance with the resolution of Board of Directors meeting held on July13, 2023.
Outline of borrowings(1) Lenders

Seven financial institutions with which we do business(2) Amount of borrowings

10 billion yen(3) Borrowing rate

Fixed interest rate(4) Borrowing date

From July 19, 2023 to July 31, 2023

(5) Borrowing period

7 to 10 years(6) Use of the funds

Operating funds(7) Collateral

Unsecured, unguaranteed– 13 –