September 24, 2020
SEIKAGAKU CORPORATION(Securities Code: TSE 4548)

Seikagaku Announces Forecast of Consolidated Financial Resultsand Dividend Forecast
Seikagaku Corporation (Tokyo, Japan; “Seikagaku”) hereby announces its forecast of consolidated financial
results and dividend forecast for fiscal 2020 (April 1, 2020 to March 31, 2021), as detailed below. The forecast
was undecided as of the May 19, 2020 disclosure of the Consolidated Financial Results (Japan GAAP)(Summary) for the Fiscal Year Ending March 31, 2020.

1. Forecast of financial results(1) Forecast of full-year consolidated financial results for fiscal 2020
(April 1, 2020 to March 31, 2021)(Millions of yen)
Net sales

Previous forecast (A)Revised forecast (B)－Operating
incomeOrdinary
income－－26,650550

Net income
attributable toNet income

owners of parent

per share
(Yen)

－－

1,400

1,150

20.38

Change (B - A)－－－－－

Change (%)－－－－－(10,839)(192.15)

Reference: Results forfiscal 2019

28,642

1,960

3,981

(2) Reason for the disclosure
The forecast of consolidated financial results for the fiscal year ending March 31, 2021 was undecided becauseof the difficulty of reasonably assessing the impact of COVID-19 on the business and financial results. Seikagaku
hereby announces the forecast, which has now been calculated on the basis of the first-quarter financial results andcurrently available information and forecasts.
Sales performance in Japan and the United States, key markets for Seikagaku’s business, returned toapproximately the prior-year level in July and August after bottoming out in the first quarter. Although the spread ofCOVID-19 infection cannot be expected to subside in the foreseeable future, on the assumption that economic
activity will not be severely restricted again, Seikagaku forecasts that the impact of COVID-19 on the consolidated
financial results will stay within a certain range.
Net sales are forecast to decline compared to the prior year on lower first-quarter sales in Japan and overseas
attributable to the spread of COVID-19 infection coupled with drug price reductions in Japan.
Operating income is forecast to decline due to the sales decrease and higher expenses related to measures topromote subject enrollment in an additional clinical study underway in the United States for SI-6603, a treatment for1lumbar disc herniation, despite a decrease in operating expenses in connection with a review of expenses related tosales promotion activities. Ordinary income is expected to decline due to a forecast decrease in royalty income. A
return to profitability on a net income basis is expected as a result of non-recurrence of an extraordinary loss
recorded in the previous fiscal year in connection with impairment of property, plant and equipment related to thepharmaceuticals business.
The forecast for R&D expenses is ¥7.4 billion (an increase of 7.6% year on year), or 27.8% of net sales.
Note: The exchange rate assumption used in the forecast of consolidated business results for fiscal 2020 is ¥105
to the U.S. dollar.
If a significant variance from the forecast is expected due to a future change in the spread of COVID-19 oranother reason, Seikagaku will promptly make a revised announcement.
2. Dividend forecast(1) Dividend forecast for fiscal 2020
Annual dividends (Yen)Previous forecast

Interim dividend

Year-end dividend

Total－－－

Revised forecast

10.00

10.0020.00

Reference: Results forfiscal 2019

13.00

13.00

26.00

(2) Reason for disclosure of dividend forecast
The dividend forecast for the fiscal year ending March 31, 2021, like the forecast of financial results, was undecided.
Seikagaku hereby announces the forecast, which has now been decided as detailed above.
Seikagaku considers the return of profits to shareholders to be an important management priority and has madepaying dividends linked to business performance a basic policy. In accordance with this policy, Seikagaku aimed fora dividend payout ratio of 50% for fiscal 2020 and 2021, taking into consideration business profits and other factors.
However, with regard to the dividend forecast for fiscal 2020 disclosed today, Seikagaku intends to pay an annual
dividend of ¥20 per share, representing a dividend payout ratio of 98.1% based on the earnings forecast, forcontinuing to hold Seikagaku shares notwithstanding the presence of a special factor, namely the spread of COVID19.
Note: The above forecast has been prepared on the basis of economic circumstances, market trends, and otherassumptions made at the time of release of this document. Actual results may differ from the forecast due to avariety of factors.
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