Consolidated Financial Results for the Three Months Ended March 31, 2023
[Japanese GAAP]May 15, 2023
Name of registrant:
Milbon Co., Ltd.
Tokyo Stock Exchange, Prime MarketCode No.:4919
URL https://www.milbon.com/en/
Representative:
Ryuji Sato, President & CEO
Inquiries:
Masahiro Murai, Managing Executive Director
TEL: +81-3-6478-6301
Scheduled filing date for quarterly report: May 15, 2023
Scheduled starting date of dividend payments: Preparation of supplementary materials on the quarterly results: Yes
Holding of an explanatory meeting on the quarterly results: Yes (Online streaming for institutional investors and analysts)(Amounts of less than one million yen have been omitted.)

1. Consolidated financial results for the three months ended March 31, 2023 (January 1, 2023 - March 31, 2023)(1) Consolidated operating results
Net sales
Three months ended March 31, 2023

Operating income

Million yen
10,340%
7.3

Million yen
1,195%(20.1)

Million yen
1,167

9,635-

1,496-

1,633

Three months ended March 31, 2022

(Percentages show year-on-year changes.)
Profit attributable to ownersof parent%
Million yen%(28.6)
882(24.4)

Ordinary income

8.7

1,166

6.9

Note: Comprehensive income

Three months ended March 31, 2023: 1,052 million yen [(41.2)%] Three months ended March 31, 2022: 1,788 million yen [30.5%]

Three months ended March 31, 2023

Basic earnings per share Diluted earnings per share
YenYen27.13-

Three months ended March 31, 2022

35.89

-

Note: Since the beginning of the previous fiscal year, sales discounts, previously categorized as non-operating expenses, are deducted from net sales. As a result, the Company
has determined that year-on-year comparisons of net sales and operating income with the same period of the previous year may be misleading. Accordingly, the percentage ofyear-on-year changes in net sales and operating income from the same period of the two fiscal years are not indicated in the above table. (Ordinary income and profit attributableto owners of parent remain unchanged.) If the figures of FY2021 were calculated on the same basis as FY2022, net sales and operating income would increase by 9.1% and1.4%, respectively, in the first quarter of FY2022. For more details, please see the FY2022 Financial Results Presentation Materials.
(2) Consolidated financial position
Total assets
Million yen
50,587

As of March 31, 2023
As of December 31, 2022
(Reference)

EquityNet assets
Million yen
43,53752,760
As of March 31, 2023: 43,537 million yen

Equity ratio%
86.1

43,991

83.4

As of December 31, 2022: 43,991 million yen

2. Payment of dividends
Annual dividends
End of 1st quarterEnd of 2nd quarter
Yen

Year ended December 31, 2022

-Year ending December 31, 2023-

Year ending December 31, 2023
(forecast)
Note: Changes to latest dividends forecast: NoneYen
40.00

40.00

End of 3rd quarterEnd of fiscal year
YenTotal-Yen
46.00

Yen
86.00

-48.0088.00

3. Consolidated operating forecasts for the fiscal year ending December 31, 2023 (January 1, 2023 - December 31, 2023)(Percentages show year-on-year changes.)
Net sales
Million yen
Year ending December 31, 2023
49,200Note: Changes to latest performance forecast: None

Profit attributable toOperating income
Ordinary income
Basic earnings per shareowners of parent% Million yen% Million yen% Million yen%
Yen
8.8
8,300
9.9
8,250
5.4
5,800
4.0
178.34

*Notes(1) Significant changes in subsidiaries during the period(changes in specified subsidiaries resulting in the change in the scope of consolidation): NoneExclude: 0 companies (Company name: )New: 0 company (Company name: )(2) Application of accounting methods specific to the preparation of quarterly consolidated financial statements: None
(3) 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(4) Number of shares issued (common stock)1) Number of shares issued at the end of the period(including treasury shares)
2) Number of treasury shares at the end of the period
3) Average number of shares during the period

As ofMarch 31, 2023
As ofMarch 31, 2023
Three months ended
March 31, 2023

33,117,234 shares591,637 shares
32,525,662 shares

As ofDecember 31, 2022
As ofDecember 31, 2022
Three months ended
March 31, 2022

33,117,234 shares
591,511 shares
32,511,104 shares*These financial statements are not subject to the review by a certified public accountant or an audit corporation.
*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.

○Accompanying Materials – Contents
1. Qualitative Information on Consolidated Results for the Current Period.................................................................................

2(1)Explanation of Operating Results................................................................................................................................... .....

2(2)Explanation of Financial Position........................................................................................................................................

3(3)Explanation of Forward-Looking Statements Including Consolidated Operating Forecasts...............................................

3

2. Quarterly Consolidated Financial Statements and Main Nottes........................................................................................... ....

4(1)Quarterly Consolidated Balance Sheets...............................................................................................................................

4(2)Quarterly Consolidated Statements of Earnings and Quarterly Consolidated Statements of Comprehensive Income.......

6

Quarterly Consolidated Statements of Earnings............................................................................................................

6Three months ended March 31, 2022 and 2023.........................................................................................................

6

Quarterly Consolidated Statements of Comprehensive Income....................................................................................

7

Three months ended March 31, 2022 and 2023.........................................................................................................

7(3)Notes Regarding Quarterly Consolidated Financial Statements..........................................................................................

8(Notes regarding going concern assumption)....................................................................................................................

8(Notes in case of any significant changes in shareholders’ equity)...................................................................................

8(Segment Information, etc.)...............................................................................................................................................

8(Significant subsequent events)...................................................................................................... ...................................

8-1-1.

Qualitative Information on Consolidated Results for the Current Period
Explanation on Operating Results(1)

In the first quarter of this fiscal year, the Japanese economy experienced a modest recovery as economic activities normalized
following the relaxation of COVID-19 restrictions. However, the outlook remains uncertain due to factors such as inflation, theongoing crisis in Ukraine, and concerns about an economic slowdown triggered by global monetary tightening.
In light of this situation, our Group has been promoting the 2022-2026 Medium-Term Management Plan with the vision of“becoming the leading manufacturer in Asia and top 5 in the world by elevating the value of industry professionals in the eyes ofconsumers and society at large."
In FY2023, which marks the second year of the plan, the Group will carry out key initiatives to achieve the Beauty Platform
Plan, which introduces new form of salons. This includes developing Smart Salons, launching a collaborative product withPanasonic, and starting the Beauty Health Care business.
Consolidated net sales for the first quarter amounted to 10,340 million yen (a 7.3% increase year-on-year). One of the main
contributing factors was the steady double-digit growth in sales of our Premium Brands, Aujua and Global Milbon, within thehaircare products segment. Another significant factor was the robust sales of ENOG, a hair coloring product launched last year,with strong sales observed specifically in South Korea within our overseas markets.
In terms of earnings, operating income was 1,195 million yen (a 20.1% decrease year-on-year), ordinary income was 1,167
million yen (a 28.6% decrease year-on-year), and the quarterly net income attributable to owners of parent was 882 million yen(a 24.4% decrease year-on-year). These results were influenced by a decline in gross profit margin caused by soaring raw
material prices and other factors, and increases in sales promotion expenses and travel and transportation expenses due toincreased sales activities resulting from the relaxation of restrictions.
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](Unit: Million yen)
Product category

Three months ended March 31, Three months ended March 31,2022
2023
AmountRatio (%)

AmountRatio (%)

Increase(decrease)amountYear-on-yearchange (%)

Hair care products

5,333

55.4

5,969

57.7

636

11.9

Hair coloring products

3,800

39.4

3,922

38.0

122

3.2

Permanent wave products

314

3.3

301

2.9(13)(4.4)

Cosmetic products

137

1.4

126

1.2(10)(7.7)

Other490.5

200.2(28)(58.0)

9,635

100.0

10,340

100.0

705

7.3

Total[Breakdown of net sales into domestic and overseas sales](Unit: Million yen)Three months ended March 31,
2022
AmountThree months ended March 31,2023

Ratio (%)

AmountRatio (%)

Increase(decrease)amountYear-on-yearchange (%)

Domestic sales

7,249

75.2

7,659

74.1

410

5.7

Overseas sales

2,385

24.8

2,681

25.9

295

12.4

Total

9,635

100.0

10,340

100.0

705

7.3

-2-(2)

Explanation on Financial Position
Total assets at the end of the first quarter decreased 2,173 million yen from the end of the previous fiscal year to 50,587
million yen.
Current assets decreased by 2,535 million yen from the end of the previous fiscal year to 24,162 million yen. The main factors
for the change were decreases of 3,358 million yen in Cash and deposits and 695 million yen in Notes and accounts receivable trade, and increases of 1,072 million yen in Merchandise and finished goods and 352 million yen in Raw materials and supplies.
Non-current assets increased by 362 million yen from the end of the previous fiscal year to 26,424 million yen.
Current liabilities decreased by 1,741 million yen from the end of the previous fiscal year to 6,254 million yen. The main
factors for the change were decreases of 1,660 million yen in Accounts payable - other and 1,001 million yen in Income taxes
payable, and an increase of 727 million yen in Accounts payable - trade.
Non-current liabilities increased by 22 million yen from the end of the previous fiscal year to 794 million yen.
Net assets decreased by 453 million yen from the end of the previous fiscal year to 43,537 million yen. The main factors forthe change were a decrease of 622 million yen in Retained earnings and an increase of 104 million yen in Valuation difference
on available-for-sale securities due to an increase in unrealized gains on listed shares at market value.
As a result, the equity ratio changed from 83.4% at the end of the previous fiscal year to 86.1%. Net assets per share based on
the total number of shares issued and outstanding at the end of the fiscal year were 1,338.57 yen, compared with 1,352.52 yen at
the end of the previous fiscal year.

(3)

Explanation of Forward-Looking Statements Including Consolidated Operating Forecasts
There is no change from the previous forecast (announced on February 14, 2023) for the full-year performance forecast, as theresults progressed generally as planned in the first quarter of the consolidated fiscal year.

-3-

2.

Quarterly Consolidated Financial Statements and Main Notes(1)

Quarterly Consolidated Balance Sheets(Thousand yen)Previous fiscal year
(As of December 31, 2022)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Merchandise and finished goods
Work in processRaw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
LandConstruction in progress
Other, net
Total property, plant and equipment
Intangible assets
Investments and other assets
Investment securities
Long-term loans receivable
Net defined benefit asset
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Accounts payable - trade
Accounts payable - other
Income taxes payable
Provision for bonuses
Other
Total current liabilities
Non-current liabilities
Net defined benefit liability
Deferred tax liabilities
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities-4-Current 1st quarter(As of March 31, 2023)

12,300,053
5,255,686
6,319,121
39,927
1,999,103
784,924(185)
26,698,631

8,942,049
4,559,742
7,391,808
80,296
2,351,816
837,135
24,162,849

9,014,115
3,082,059
6,452,228
453,754
817,742
19,819,899
1,902,217

9,098,724
2,972,535
6,454,230
654,809923,322
20,103,622
1,911,136

1,775,734
7,425
56,180826,583
1,719,802(46,087)
4,339,639
26,061,755
52,760,387

1,925,753
13,01454,004
727,596
1,735,357(46,087)
4,409,639
26,424,398
50,587,247

1,133,259
4,022,247
1,334,496
591,582
914,619
7,996,205

1,861,236
2,361,632
332,593459,665
1,239,453
6,254,580

10,628610
643,317
117,875
772,4318,768,636

10,794
613
664,656
118,777794,842
7,049,422

(Thousand yen)Previous fiscal year
(As of December 31, 2022)
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets-5-Current 1st quarter(As of March 31, 2023)

2,000,000
274,537
41,875,487(2,030,911)
42,119,113

2,000,000
274,610
41,252,576(2,031,700)
41,495,486

214,928
1,766,040(108,331)
1,872,637
43,991,750
52,760,387

319,042
1,823,666(100,371)
2,042,337
43,537,824
50,587,247

(2) Quarterly Consolidated Statements of Earnings and Consolidated Statements of Comprehensive Income
Quarterly Consolidated Statements of Earnings
Three Months Ended March 31, 2022 and 2023

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Foreign exchange gains
Company house defrayment income
Subsidy income
Other
Total non-operating income
Non-operating expenses
Share of loss of entities accounted for using equity
methodForeign exchange losses
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Total extraordinary income
Extraordinary losses
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 owners of parent(Thousand yen)Three months ended March 31, Three months ended March 31,2022
2023(January 1, 2022
(January 1, 2023
- March 31, 2022)- March 31, 2023)
9,635,091
10,340,911
3,183,636
3,590,354
6,451,455
6,750,556
4,954,643
5,555,345
1,496,812
1,195,211

-6-

4,048
7,441
98,404448
27,79935,583
173,725

3,380
8,687
455
1,829
8,648
23,001

36,163

18,265798
36,961
1,633,575

31,4981,260
51,024
1,167,188

232
448
681

-564
564
1,633,692
396,153
70,765466,918
1,166,7731,166,773

1,504
1,504
1,165,683
242,352
41,017283,369
882,314882,314

Quarterly Consolidated Statements of Comprehensive Income
Three Months Ended March 31, 2022 and 2023

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
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners ofparent
Comprehensive income attributable to non-controllinginterests(Thousand yen)Three months ended March 31, Three months ended March 31,2022
2023(January 1, 2022
(January 1, 2023
- March 31, 2022)- March 31, 2023)
1,166,773
882,314-7-(14,470)(68,821)708,068(2,570)622,205
1,788,979

104,11357,626
7,960
169,700
1,052,014

1,788,979

1,052,014--

(3) Notes Regarding Quarterly Consolidated Financial Statements(Notes regarding going concern assumption)
None(Notes in case of any significant changes in shareholders' equity)
None(Segment information, etc.)
This information is omitted since the Group has a single segment of manufacture and sales of cosmetic products.
(Significant subsequent events)(Disposal of treasury stock as restricted stock compensation)
On April 14, 2023, the Board of Directors resolved to dispose of treasury stock (the "Disposal of Treasury Stock" or"Disposal") as restricted stock compensation.
1. Overview of the Disposal of Treasury Stock(1) Date of disposal(2) Class and number of shares subject to disposal

May 12, 2023
14,714 shares of common stock of the Company(3) Disposal price(4) Total value of disposal

5,630 yen per share
82,839,820 yen(5) Allottees and number of shares to be allotted

6 Board Directors (excluding Outside Board Directors)
10,009 shares
8 Executive Officers
4,705 shares(6)OtherThe Company has submitted a notice of securities inaccordance with the Financial Instruments and Exchange Act
for the disposal of treasury stock.

2. Purpose and Reasons for Treasury Stock Disposal
The Company has resolved to dispose of treasury stock in order to grant restricted stock to Board Directors (excludingOutside Board Directors) and Executive Officers with the aim of providing incentives to continuously improve the corporate
value of the Company and further promoting the sharing of value with shareholders.
On February 12, 2020, the Board of Directors resolved to introduce a restricted stock compensation plan.

-8-