Consolidated Quarterly Financial Results
for the Three Months Ended June 30, 2023 [Japanese GAAP]
August 10, 2023
Company:
Stock Exchange Listing: Tokyo
Hokuetsu Corporation
Stock Code:3865
URL: http://www.hokuetsucorp.com
Representative: Sekio Kishimoto, President & CEOContact:
Tomonari Maruyama, General Manager, Corporate Management Department TEL: +81-3-3245-4500
Scheduled date of filing quarterly report:
August 10, 2023
Scheduled date of commencement of dividend payments:–
Supplementary documents for quarterly results:
None
Quarterly results briefing:
None(Figures rounded down to the nearest million yen)

1. Consolidated Business Results for the Three Months Ended June 30, 2023
(April 1, 2023 through June 30, 2023)(1) Consolidated results of operations
Net sales
Three months ended
June 30, 2023
Three months ended
June 30, 2022
(Note) Comprehensive income:(% change from the previous corresponding period)
Profit attributable toOperating profit
Ordinary profit
owners of parent
Million yen%
Million yen%
Million yen%

Million yen%

75,273

14.3

7,168

96.0

8,787

48.2

6,323

71.4

65,8435.7

3,658(22.4)

5,927(14.9)

3,690(50.8)

Three months ended June 30, 2023: 9,225 million yen
Three months ended June 30, 2022: 6,003 million yen
Diluted earnings
Basic earnings per shareper share
Yen
Yen(53.7%)(-38.8%)Three months ended
June 30, 2023
Three months ended
June 30, 2022

37.62

37.58

21.96

21.93

(2) Consolidated financial position

As of June 30, 2023
As of March 31, 2023
(Reference) Equity:

Total assets
Net assets
Equity ratio
Million yen
Million yen%
401,694
233,35357.9
388,444
225,950
58.0
As of June 30, 2023:
232,589 million yenAs of March 31, 2023:
225,209 million yen

2. Dividends
End of 1Q
Yen––

Annual dividend per share
End of 2Q
End of 3Q
Yen
Yen
9.00
–Year ended March 31, 2023
Year ending March 31, 2024
Year ending March 31, 2024
9.00
(forecast)(Note) Revisions to dividend forecasts published most recently: None–

Year-end

Total
Yen
9.00

Yen
18.00

9.00

18.00

3. Forecast of Consolidated Financial Results for the Year Ending March 31, 2024
(April 1, 2023 through March 31, 2024)(% change from the previous corresponding period)
Net sales

Operating profit

Million yen% Million yen%
2Q (Accumulated)
150,000
10.1
10,000150.1
Full year
310,000
2.9
11,000(36.4)(Note) Revisions to business forecasts published most recently: None-1-Ordinary profit
Million yen
12,00014,000%148.5
22.0

Basicearnings pershare%Yen
308.3
47.60
8.1
53.55

Profit attributable toowners of parent
Million yen
8,000
9,000

* Notes(1) Changes in significant subsidiaries during the three months ended June 30, 2023 (changes in specified subsidiaries accompanying changes
in the scope of consolidation): None(2) Application of accounting procedures specific to preparation of the consolidated quarterly financial statements: None
(3) Changes in accounting policies, accounting estimates and restatement of prior period financial statements(i) Changes in accounting policies due to amendment to accounting standards: None(ii) Changes in accounting policies other than (i): None(iii) Changes in accounting estimates: None(iv) Restatement of prior period financial statements: None
(4) Shares outstanding (common stock)(i) Number of shares outstanding (treasury stock included):
As of June 30, 2023
188,053,114 shares(ii) Number of treasury stock:
As of June 30, 2023
19,951,002 shares(iii) Average number of shares during period:
Three months ended June 30, 2023 168,085,841 shares

As of March 31, 2023

188,053,114 shares

As of March 31, 2023

19,972,637 shares

Three months ended June 30, 2022

168,051,824 shares* Consolidated Quarterly Financial Results are exempted from quarterly review performed by a certified public
accountant or an audit corporation.
* Explanation regarding appropriate use of business forecasts and other special instructions(Caution regarding forward-looking statements)
The forward-looking statements such as forecasts of financial results contained in this material are based on information available to theCompany at the time of the publication of this document and certain assumptions that the Company considers to be reasonable, and may differ
materially from the actual results due to various factors. Refer to “1. Qualitative Information on Consolidated Operating Results for the FirstQuarter; (3) Qualitative Information Concerning Consolidated Earnings Forecasts” on page 3 of the accompanying materials for matters related
to results forecasts.

-2-1. Qualitative Information on Consolidated Operating Results for the First Quarter(1) Qualitative Information Concerning Consolidated Operating Results
During the first three months of the current fiscal year, net sales, operating profit, ordinary profit and profit attributable to owners of parent
came to 75,273 million yen (up 14.3% year on year), 7,168 million yen (up 96.0% year on year), 8,787 million yen (up 48.2% year onyear) and 6,323 million yen (up 71.4% year on year), respectively, reflecting the implementation of price increases, despite soaring raw
material and fuel prices.
The performance of major segments is as follows:(i) Pulp and paper businessIn the pulp and paper business, both sales and profits increased, mainly reflecting the implementation of price increases, despite soaring
raw material and fuel prices.
As a result, the results of the pulp and paper business were as follows.
Net sales

69,418 million yen (up 14.7% year on year)

Operating profit

6,691 million yen (up 98.8% year on year)(ii) Packaging/Paper processing businessIn the packaging/paper processing business, both sales and profits increased, mainly reflecting higher selling prices due to price increases
and a rise in the sales volume.
As a result, the results of the packaging/paper processing business were as follows.
Net sales
Operating profit

3,860 million yen (up 20.3% year on year)
87 million yen (compared to operating loss of 59 million yen a year ago)(iii) Other businesses
In other businesses, including the wood material business, construction business, logistics business and used paper wholesale business,sales decreased due to a decline in external orders in the used paper business in particular. Even so, in terms of profitability, profits rosedue to the effect of a range of cost reduction measures.
As a result, the results of other businesses were as follows.
Net sales
Operating profit

1,994 million yen (down 5.6% year on year)
275 million yen(up 20.7% year on year)(2) Qualitative Information Concerning Consolidated Financial Position
Total assets increased 13,250 million yen from the end of the previous fiscal year, to 401,694 million yen. Significant factors included
increases of 8,455 million yen in cash and deposits, 1,616 million yen in merchandise and finished goods, 3,781 million yen in raw
materials and supplies and 1,990 million yen in investment securities, which were partially offset by a decrease in notes and accounts
receivable - trade, and contract assets amounting to 5,606 million yen in total.
Total liabilities rose 5,847 million yen from the end of the previous fiscal year, to 168,341 million yen. This was primarily due to increases
of 5,630 million yen in interest-bearing debt and 2,207 million yen in notes and accounts payable - trade, which more than offset a decrease
in income taxes payable of 1,696 million yen.
Net assets rose 7,403 million yen from the end of the previous fiscal year, to 233,353 million yen. This mainly reflected increases inretained earnings of 4,494 million yen due to profit attributable to owners of parent, and valuation difference on available-for-sale securitiesof 1,511 million yen and foreign currency translation adjustment of 1,248 million yen.

(3) Qualitative Information Concerning Consolidated Earnings ForecastsNo change has been made to the full-year financial forecasts announced on May 12, 2023.

-3-2. Quarterly Consolidated Financial Statements and Key Notes(1) Quarterly Consolidated Balance Sheet(Million yen)
(Assets)
Current assets
Cash and deposits
Notes and accounts receivable - trade, and contract assets
Electronically recorded monetary claims - operating
Merchandise and finished goods
Work in process
Raw materials and supplies
OtherAllowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Machinery, vehicles, tools, furniture and fixtures
Accumulated depreciation

As of March 31, 2023

As of June 30, 2023

18,06375,827
8,752
28,4582,792
32,4154,469(4)26,51870,2208,794
30,074
3,466
36,1975,429(4)

170,775

180,698

87,761(56,135)

87,814(56,717)

31,62531,096446,305(387,365)

448,793(389,245)

58,93959,548Other, net

26,495

26,599Machinery, vehicles, tools, furniture and fixtures, net
Total property, plant and equipment

117,060117,244

Intangible assets
Investments and other assets
Investment securities
Shares of subsidiaries and associates
OtherAllowance for doubtful accounts

2,467

2,442

22,272
63,643
12,508(283)

24,26364,88912,439(282)

Total investments and other assets

98,141

101,309

217,669
388,444

220,996
401,694

Total non-current assets
Total assets-4-

(Million yen)
(Liabilities)
Current liabilities
Notes and accounts payable - trade
Electronically recorded obligations - operating
Short-term loans
Commercial papers
Current portion of bonds payable
Income taxes payable
Provision
Other

As of March 31, 2023

As of June 30, 2023

21,283
7,820
17,05810,00010,0002,919
3,206
13,57723,491
8,472
15,59018,00010,0001,223
1,811
13,127

Total current liabilities

85,86591,716

Non-current liabilities
Bonds payable
Long-term loans
Provision
Retirement benefit liability
Asset retirement obligations
Other

10,00054,938
1,593
3,806
2,410
3,880

10,00053,994
1,650
3,821
2,370
4,788

Total non-current liabilities

76,62976,625

Total liabilities

162,494

168,341

Net assets
Shareholders’ equity
Share capital
Capital surplus
Retained earnings
Treasury shares

42,02045,342
135,489(9,625)42,02045,345
139,983(9,615)

213,226

217,734

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

4,418
79
5,907
1,576

5,930
172
7,155
1,596

Total accumulated other comprehensive income

11,982

14,855

91649

84
679

225,950

233,353

388,444401,694

Total shareholders’ equity

Share acquisition rights
Non-controlling interests
Total net assets
Total liabilities and net assets-5-(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive Income
Quarterly Consolidated Statements of Income(First three-month period)(Million yen)
For the three months
ended June 30, 2022

For the three months
ended June 30, 2023

Net sales
Cost of sales

65,843
51,94875,27357,735Gross profit

13,895

17,538Selling, general and administrative expenses

10,237

10,370Operating profit

3,658

7,168

Non-operating incomeInterest income
Dividends income
Share of profit of entities accounted for using equity method
Foreign exchange gains
Other
Total non-operating income

13497
385
1,430
226
2,553

129
399
958
217
221
1,926

138
144
283

185
122
307

5,927

8,787

1––

2
748

158

169

357

Non-operating expenses
Interest expenses
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Insurance claim income
Total extraordinary income
Extraordinary losses
Loss on sales and retirement of non-current assets

169

357

Profit before income taxes

5,759

8,488

Income taxes - current
Income taxes - deferred

1,540
505

1,625
515

Total income taxes

2,045

2,140

Profit

3,714

6,347

Total extraordinary losses

Profit attributable to non-controlling interests
Profit attributable to owners of parent-6-

23

24

3,690

6,323

Quarterly Consolidated Statements of Comprehensive Income(First three-month period)(Million yen)

ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities accounted forusing equity method
Total other comprehensive income

For the three months
ended June 30, 2022

For the three months
ended June 30, 2023

3,714

6,347

559
(41)
2,002
(60)

1,419
(8)
558
(72)

(170)

981

2,289

2,877

Comprehensive income

6,003

9,225

Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests

5,975
28

9,195
29-7-(3) Notes to Quarterly Consolidated Financial Statements(Notes to Going Concern Assumption)
Not applicable.
(Notes on Any Significant Change in the Value of Shareholders’ Equity)
Not applicable.

-8-