Summary of Consolidated Financial Results for the First Quarter of the Fiscal
Year Ending March 2024 [Japanese GAAP]
July 28, 2023
Company name: Japan Medical Dynamic Marketing, INC.
Stock exchange listing: Tokyo
Code number: 7600
URL: https://www.jmdm.co.jp/
Representative: Toshiyuki Hironaka
Representative Director and President
Contact: Shinji Munechika
General Manager, Investor Relations Office
Phone: +81-3-3341-6705
Scheduled date of filing quarterly securities report: August 14, 2023
Scheduled date of commencing dividend payments: Availability of supplementary briefing material on quarterly financial results: No
Schedule of quarterly financial results briefing session: No(Amounts of less than one million yen are rounded down.)
1. Consolidated Financial Results for the Three Months Ended June 30, 2023 (April 1, 2023 to June 30, 2023)(1) Consolidated Operating Results(% indicates changes from the previous corresponding period.)
Profit attributable to
Net sales
Operating profit
Ordinary profit
owners of parent
Millions of yen% Millions of yen% Millions of yen% Millions of yen%
Three months ended
June 30, 2023
5,402
7.5
346
(30.5)
337(30.2)
177(47.3)
June 30, 2022
5,027
10.8
498
(10.1)
483(10.7)
336(7.4)(Note) Comprehensive income:Three months ended June 30, 2023:¥
1,209 million [(20.7) %]Three months ended June 30, 2022:¥
1,524 million [321.1%]
Basic earnings
per share
Three months ended
June 30, 2023
June 30, 2022

Diluted earnings per
share
Yen

Yen

6.74
12.75

-

(2) Consolidated Financial Position
Total assets
As ofJune 30, 2023
March 31, 2023
(Reference) Equity:

Net assets

Millions of yen

Capital adequacy ratio

Millions of yen

29,92029,434As of June 30, 2023:
As of March 31, 2023:¥¥%

24,15723,292
24,009 million
23,161 million

80.2
78.7

2. Dividends
Annual dividends
1stquarter-end

2ndquarter-end

3rdquarter-end

Yen

Yen

Yen

Yen

Yen

Fiscal year ended March 31, 2023

-

0.00

-

13.00

13.00

Fiscal year ending March 31, 2024

0.00

-

14.00

14.00

Fiscal year ending March 31, 2024
(Forecast)(Note) Revision to the forecast for dividends announced most recently:
No(Note) Breakdown of the 1st quarter dividend for the fiscal year ending March 31, 2024 :Commemorative dividend- yenSpecial dividend- yenYear-endTotal

3. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2024(April 1, 2023 to March 31, 2024)(% indicates changes from the previous corresponding period.)
Profit attributable
Basic earnings
Net sales
Operating profit
Ordinary profit
to owners ofper share
parentMillions of yen% Millions of yen% Millions of yen

Six months ending
10,8008.1
800 (13.7)
September 30, 2023
Full year
23,300
9.3
2,500
23.5
(Note) Revision to the financial results forecast announced most recently:% Millions of yen

Yen

750

(18.2)

450(37.6)

17.11

2,400
No

17.4

1,500

5.4

57.03

* Notes:(1) Changes in significant subsidiaries during the three months ended June 30, 2023
(changes in specified subsidiaries resulting in changes in scope of consolidation):
New(Company name:(Company name:
Exclusion:-

No(2) Accounting policies adopted specially for the preparation of quarterly consolidated financial statements:(3) Changes in accounting policies, changes in accounting estimates and retrospective restatement
1) Changes in accounting policies due to the revision of accounting standards: No
2) Changes in accounting policies other than 1) above: No
3) Changes in accounting estimates: No4) Retrospective restatement: No(4) Total number of issued shares (common shares)
1) Total number of issued shares at the end of the period (including treasury shares):
June 30, 2023:
26,475,880 shares
March 31, 2023:
26,475,880 shares
2) Number of treasury shares at the end of the period:
June 30, 2023:
175,165 shares
March 31, 2023:
175,107 shares
3) Average number of shares outstanding during the period:
Three months ended June 30, 2023:
Three months ended June 30, 2022:%

26,300,759 shares
26,383,701 shares

)
)
Yes

Japan Medical Dynamic Marketing, INC. (7600) Summary of Financial Results for the First Quarter of the Fiscal Year Ending March 2024

○ Table of Contents of Attachment

1. Qualitative Information on Quarterly Financial Results ························································ 2(1) Explanation on Operating Results ············································································· 2(2) Explanation on Financial Position ············································································· 3(3) Explanation on Consolidated Financial Forecasts and Other Forward-looking Statements ··········· 3
2. Quarterly Consolidated Financial Statements and Main Notes ················································ 4(1) Quarterly Consolidated Balance Sheet ······································································· 4(2) Quarterly Consolidated Statement of Income and Quarterly Consolidated Statement ofComprehensive Income ························································································· 6(3) Notes to Quarterly Consolidated Financial Statements ····················································· 8(Note on Going Concern Assumption) ········································································· 8(Notes on Substantial Changes in the Amount of Shareholders’ Equity) ·································· 8(Application of Accounting Treatment Specific to the Preparation of Quarterly Consolidated
Financial Statements) ···························································································· 8(Segment Information, Etc.) ····················································································· 8
3. Other ·················································································································· 10
Sales ··············································································································· 10-1-Japan Medical Dynamic Marketing, INC. (7600) Summary of Financial Results for the First Quarter of the Fiscal Year Ending March 2024

1. Qualitative Information on Quarterly Financial Results(1) Explanation on Operating Results

During the first quarter of the fiscal year ending March 31, 2024, of the Group, net sales were ¥5,402 million (up¥375 million, or 7.5% year on year), operating profit came to ¥346 million (down ¥152 million, or 30.5% year onyear), ordinary profit was ¥337 million (down ¥146 million, or 30.2% year on year), and net income attributable toowners of parent amounted to ¥177 million (down ¥159 million, or 47.3% year on year). Net sales of our own products
accounted for 80.1% of consolidated net sales (80.1% in the same quarter a year ago).
In Japan, net sales were ¥3,055 million (up ¥121 million or up 4.1% year on year) (after partial deduction ofpromotional expenses due to the application of Accounting Standard for Revenue Recognition) as a result of anincrease in the number of acquired cases, despite the impact of the lowering of reimbursement prices implemented in
April 2023. In the United States, the new customer base that we developed last year contributed to growth, and there
was an increase in the number of cases of artificial knee joints products acquired. As a result, net sales to externalcustomers in the United States increased to $16 million (up $700,000, or 4.8% year on year), and after translation into
yen, net sales were ¥2,347 million (up ¥253 million, or 12.1% year on year) due to the impact of the yen’s depreciation.
(Reference: The exchange rate for U.S. sales was 129.05 yen to the U.S. dollar in the same quarter a year ago and was
138.11 yen to the U.S. dollar in the quarter under review.)
For the artificial joints category in Japan, the number of cases had been gradually increasing due to the change of
COVID-19 to a Category 5 disease. Sales of Entrada were strong with double-digit growth, and the number of acquired
cases of hip replacement arthroplasty (THA, BHA) increased, resulting in net sales of ¥1,170 million in Japan (up3.2% year on year).
For the artificial joints category in the United States, U.S. net sales increased to $16 million (up 4.7% year on year),as the number of acquired cases of artificial knee joints BKS TriMax and BKS Revision Knee increased. Aftertranslation into yen, U.S. sales were ¥2,338 million (up 12.1% year on year) due to the impact of the yen’s depreciation.
In the category of trauma, net sales in Japan were ¥1,038 million (up 8.1% year on year), mainly due to steady salesof ASULOCK and Prima Hip Screw with double-digit growth exceeding the market growth.
In the spinal fixation devices category, sales of Vusion Ti 3D Cage and Pisces Spinal System increased in Japan. On
the other hand, the number of acquired cases of the KMC Kyphoplasty System decreased due to competitors entering
the Balloon Kyphoplasty (BKP) market. As a result of these factors, total net sales in Japan and the United States were¥821 million (down 0.7% year on year).
As for cost of sales, the cost of sales ratio was 35.4% (33.4% in the same quarter a year ago) mainly due to theimpact of the yen’s depreciation and lowering of reimbursement prices in Japan. Selling, general, and administrative
expenses totaled ¥3,142 million (up 10.3% year on year). This was due to an increase in commission expenses(commissions and royalties) in the wake of higher sales in the United States, an increase in personnel expenses as aresult of strengthening of the systems, an increase in research and development expenses for new products, higher
promotion expenses of holding seminars for customers hosted by our U.S. subsidiary every other year, and an increasein expenses in the United States after translation into yen due to the depreciation of the yen. In addition, the ratio of
selling, general, and administrative expenses to net sales grew to 58.2% (56.7% in the same quarter a year ago).
Despite an increase in net sales, operating profit was ¥346 million (down 30.5% year on year) due to an increase in
selling, general and administrative expenses in addition to a higher cost of sales ratio owing to the impact of the yen’s
depreciation.
Ordinary profit was ¥337 million (down 30.2% year on year) as a result of recording non-operating income of ¥17
million, including foreign exchange gains of ¥10 million, and recording non-operating expenses of ¥26 million,
including share of loss of entities accounted for using equity method of ¥16 million.
As for extraordinary income and losses, ¥84 million was recorded under extraordinary losses, consisting of ¥9million in loss on retirement of non-current assets such as medical tools and ¥75 million in settlement-related expenses.
As a result, net income attributable to owners of parent amounted to ¥177 million (down 47.3% year on year).
Segment results are as follows.
1) JapanNet sales were ¥3,055 million (up 4.1% year on year) and operating profit was ¥236 million (down 7.5% year onyear).
2) United States
Net sales were ¥3,182 million (up 7.9% year on year) and operating profit was ¥54 million (down 73.5% year onyear).

-2-

Japan Medical Dynamic Marketing, INC. (7600) Summary of Financial Results for the First Quarter of the Fiscal Year Ending March 2024

(2) Explanation on Financial Position

Total assets at the end of the quarter under review increased ¥486 million from the end of the previous fiscal year to¥29,920 million. The main factors for increases were an increase in merchandise and finished goods of ¥747 million
and raw materials and supplies of ¥135 million. The main factor for decreases was a decrease of cash and deposits of¥361 million.
Total liabilities decreased ¥379 million from the end of the previous fiscal year to ¥5,763 million. The main decreases
consisted of a decrease in income taxes payable of ¥218 million, a decrease in provision for bonuses of ¥144 million,a decrease in short-term borrowings of ¥100 million, and a decrease in provision for litigation settlement of ¥100
million, while the main increase was an increase in accrued expenses of ¥278 million.
Total net assets increased ¥865 million from the end of the previous fiscal year to ¥24,157 million. The main factor
for increases was an increase in foreign currency translation adjustment of ¥907 million.

(3) Explanation on Consolidated Financial Forecasts and Other Forward-looking Statements

There is no change to the consolidated financial forecast for the current fiscal year announced on April 28, 2023.

-3-

Japan Medical Dynamic Marketing, INC. (7600) Summary of Financial Results for the First Quarter of the Fiscal Year Ending March 2024

Quarterly Consolidated Financial Statements
Quarterly Consolidated Balance Sheets(Thousands of yen)
As of March 31, 2023

As of June 30, 2023

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade, and contract
assetsMerchandise and finished goods
Work in process

2,804,928

2,443,252

5,270,930

5,119,970

9,378,119
593,162

10,125,645
455,306

Raw materials and supplies
Other

1,634,044
295,253

1,769,377
464,748

Allowance for doubtful accounts(1,358)(1,276)

19,975,079

20,377,025

837,544889,353

Machinery, equipment and vehicles, net
Tools, furniture and fixtures, net

306,786
4,600,008

353,731
4,641,233

Land
Other

1,956,171
44,246

1,959,045
44,660Total property, plant and equipment

7,744,756

7,888,025

263,037

254,529

66,77072,495204,910

205,814

1,104,875
75,283

1,050,257
72,843

1,451,839

1,401,409

9,459,634

9,543,964

29,434,714

29,920,990

Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net

Intangible assets
Investments and other assets
Investment securities
Investments in capital of subsidiaries andassociates
Deferred tax assets
Other
Total investments and other assets
Total non-current assets
Total assets-4-Japan Medical Dynamic Marketing, INC. (7600) Summary of Financial Results for the First Quarter of the Fiscal Year Ending March 2024

(Thousands of yen)
As of March 31, 2023

As of June 30, 2023

Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term borrowings

979,185
1,046,733

911,302946,300

Lease liabilities
Income taxes payable

34,553
339,245

32,855
121,030

Accrued expenses
Accounts payable - other511,861
193,732

790,332
136,088

Provision for bonuses
Provision for bonuses for directors (and otherofficers)
Provision for loss on business
Provision for litigation settlement

196,606

52,39164,510

7,980

2,546
100,000

2,419
-

Other
Total current liabilities

158,217230,550

3,627,191

3,231,250

732,248
58,163676,91054,402

1,208,511

1,229,564

103,514106,223

29,4938,000

29,56229,000Non-current liabilities
Long-term borrowings
Lease liabilities
Retirement benefit liability
Provision for share awards for directors (and otherofficers)
Asset retirement obligations
Long-term deposits received
Deferred tax liabilities

375,495

406,6942,515,427

2,532,358

6,142,618

5,763,609

Share capital
Capital surplus

3,001,929
2,587,029

3,001,929
2,587,029

Retained earnings
Treasury shares

15,656,266(202,730)

15,489,551(202,792)

Total shareholders' equity

21,042,494

20,875,717

Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity

Accumulated other comprehensive income
Deferred gains or losses on hedges

30,294

133,810Foreign currency translation adjustment
Remeasurements of defined benefit plans

2,163,161(74,317)3,070,980(71,435)

Total accumulated other comprehensive income

2,119,138

3,133,355

130,462

148,308

23,292,095

24,157,381

29,434,714

29,920,990

Non-controlling interests
Total net assets
Total liabilities and net assets-5-Japan Medical Dynamic Marketing, INC. (7600) Summary of Financial Results for the First Quarter of the Fiscal Year Ending March 2024

Quarterly Consolidated Statements of Income and Comprehensive Income
Quarterly Consolidated Statements of Income (For the three months)(Thousands of yen)
For the three months
ended June 30, 2022

For the three months
ended June 30, 2023

Net sales
Cost of sales

5,027,421
1,678,888

5,402,640
1,913,737

Gross profit

3,348,532

3,488,902

Selling, general and administrative expenses
Freight and packing costs
Promotion expenses
Advertising expenses
Salaries and allowances
Retirement benefit expenses
Legal welfare expenses
Welfare expenses
Provision of allowance for doubtful accounts
Travel and transportation expenses
Depreciation
Taxes and dues
Research and development expenses
Commission expenses
Other
Total selling, general and administrative expenses

108,41343,81622,991
899,198
24,991
77,81574,979(157)
55,831
339,062
36,117
135,954
696,827
334,035
2,849,877

112,639
77,31820,562
963,882
26,54780,65571,780(81)
78,757
330,961
33,512
182,945799,377
363,653
3,142,513

Operating profit

498,655

346,388

Non-operating income
Interest income
Foreign exchange gains
Commission income
Insurance claim income
Other

28
2,844
13,22018,92625
10,946
6,911

35,02017,883

5,751
30,969

5,121
-

7,642

16,3102,056
3,452
49,871

2,086
3,149
26,668483,803337,603

6,967

-

6,967

-

12,121-

9,410
75,00012,121

84,410

Profit before income taxes

478,649

253,193

Income taxes - current
Income taxes - deferred

136,306
2,485

66,751
6,743

Total income taxes

138,792

73,494

Profit339,857

179,698

3,347

2,427

336,510

177,271

Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Share of loss of entities accounted for using equity
methodCommission for syndicated loans
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Reversal of provision for loss on businessTotal extraordinary income
Extraordinary losses
Loss on retirement of non-current assets
Settlement-related costs
Total extraordinary losses

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

Japan Medical Dynamic Marketing, INC. (7600) Summary of Financial Results for the First Quarter of the Fiscal Year Ending March 2024

Quarterly Consolidated Statements of Comprehensive Income (For the three months)(Thousands of yen)
For the three months
ended June 30, 2022
ProfitOther comprehensive income
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax

For the three months
ended June 30, 2023

339,857

179,698

96,486
1,084,814

103,515923,237

3,486

2,882

1,184,788

1,029,635

Comprehensive income

1,524,645

1,209,333

Comprehensive income attributable toComprehensive income attributable to owners ofparentComprehensive income attributable to non-controllinginterests

1,503,182

1,191,488

21,463

17,845

Total other comprehensive income-7-Japan Medical Dynamic Marketing, INC. (7600) Summary of Financial Results for the First Quarter of the Fiscal Year Ending March 2024

(3) Notes to Quarterly Consolidated Financial Statements(Note on Going Concern Assumption)
Not applicable.
(Notes on Substantial Changes in the Amount of Shareholders’ Equity)
Not applicable.
(Application of Accounting Treatment Specific to the Preparation of Quarterly Consolidated Financial Statements)
Tax expenses were calculated by reasonably estimating an effective tax rate after application of tax effectaccounting to net income before income taxes and others for the fiscal year including the quarter under review andmultiplying net income before income taxes and others by the estimated effective tax rate.
(Segment Information, Etc.)
I. First Quarter of the Fiscal Year Ended March 2023 (from April 1 to June 30, 2022)
1. Information on the amounts of sales and profits for each reportable segment and information on the breakdown ofrevenue(In thousand yen)Amount recordedon quarterly
consolidated
statement ofincome(Note 2)

Reportable segment
Japan

United States

Total

Adjustment(Note 1)

Net sales
Revenue from contracts withcustomers

2,933,867

2,093,553

5,027,421-

5,027,421

Net sales to external customers

2,933,867

2,093,553

5,027,421-

5,027,421-

855,861

855,861(855,861)-

2,933,867

2,949,415

5,883,282(855,861)

5,027,421

255,153

206,652

461,806

36,849498,655

Inter-segment net sales ortransfers
Total
Segment profit

Notes: 1. Adjustments for segment profit include ¥36,849,000 in elimination of inter-segment transactions.
2. Segment profit was adjusted with operating profit in the quarterly consolidated statement of income.
3. For revenue from contracts with customers in “Japan,” part of the promotion expenses is deducted by applying the
Accounting Standard for Revenue Recognition.

2. Information on impairment losses on non-current assets and goodwill by reportable segment
Not applicable.

-8-Japan Medical Dynamic Marketing, INC. (7600) Summary of Financial Results for the First Quarter of the Fiscal Year Ending March 2024

II. First Quarter of the Fiscal Year Ending March 2024 (from April 1 to June 30, 2023)
1. Information on the amounts of sales and profits for each reportable segment and information on the breakdown ofrevenue(In thousand yen)Amount recordedon quarterly
consolidated
statement ofincome(Note 2)

Reportable segment
Japan

United States

Total

Adjustment(Note 1)

Net sales
Revenue from contracts withcustomers

3,055,337

2,347,303

5,402,640-

5,402,640

Net sales to external customers

3,055,337

2,347,303

5,402,640-

5,402,640-

835,458

835,458(835,458)-

3,055,337

3,182,762

6,238,099(835,458)

5,402,640

236,134

54,818290,953

55,434346,388

Inter-segment net sales ortransfers
Total
Segment profit

Notes: 1. Adjustments for segment profit include ¥55,434,000 in elimination of inter-segment transactions.
2. Segment profit was adjusted with operating profit in the quarterly consolidated statement of income.
3. For revenue from contracts with customers in “Japan,” part of the promotion expenses is deducted by applying the
Accounting Standard for Revenue Recognition.

2. Information on impairment losses on non-current assets and goodwill by reportable segment
Not applicable.

-9-Japan Medical Dynamic Marketing, INC. (7600) Summary of Financial Results for the First Quarter of the Fiscal Year Ending March 2024

3. Other
Sales
Sales for the first quarter under review by segment are as follows.
Name and item of each segment

The first quarter under review(From April 1 to June 30, 2023)

Compared with thesame quarter a year ago

Amount (in thousand yen)(%)

3,055,337

104.1

Joint

1,170,924

103.2

Trauma1,038,381

108.1

Spine

812,879

99.0

Other

91,917

105.5

Sales deduction(58,765)-

United States

2,347,303

112.1

Joint

2,338,768

112.1

Spine

8,534

131.3

Total

5,402,640

107.5

Japan

Medical devices

Ratio (%)
Sales ratio of our own products

Change (%)
80.1

0.0

(Notes) 1. Inter-segment transactions are offset and eliminated.
2. For “Sales deduction,” part of the promotion expenses is deducted from net sales by applying the Accounting Standard
for Revenue Recognition in Japan. However, the above table shows the amount of such deduction as a lump sum
because reasonable proration by item is not possible.

-10-