[Terumo Corporation] Financial Results for the First Three Quarters of the Fiscal Year Ending March 31, 2019: Reference[IFRS] Financial Results for the First Three Quarters of the Fiscal Year Ending March 31, 2019:
Reference
Analysis of Business Performance
1. Overview of Financial Results for the First Three Quarters of the Fiscal Year Ending March 31, 2019(1) Overview of Consolidated Business Results
In the first three quarters of the current fiscal year (from April 1 to December 31, 2018), the global healthcare
market was underscored by measures to curb medical expenditures in each country. Amid this environment,
NHI reimbursement prices in Japan underwent revisions in April. And as has been the case, there continues tobe rising demand, chiefly in developed countries, for better healthcare economics to achieve a more focusedand efficient allocation of fiscal resources.
Amid this backdrop, in line with the Mid- and Long-term Vision, the Terumo Group, as a “Global Corporationwith Unique Excellence,” aims to become recognized by medical professionals worldwide as a top brand anda trusted manufacturer by winning a high level of trust globally for our total quality (which includes the total
quality of its products, supply, and services).
Financial results for the first three quarters of the fiscal year ending March 31, 2019 are as follows. TheAshitaka factory experienced shipping delays for certain products beginning from May 2018 but shipments
have stabilized since October 2018. Sales are trending towards recovery.

(million yen)
Q1-Q3
FYE3/2019

Growth(%)

Growthexcluding
impact of forex
translations (%)

436,955
238,649
97,571
86,56985,63876,907

443,609242,159
91,17978,47475,00856,395

1.5
1.5(6.6)(9.4)(12.4)(26.7)

2.3
2.2
(6.2)
(8.4)
－－

76,97456,495(26.6)－Q1-Q3
FYE3/2018
Revenue
Gross profit
Adjusted operating profit
Operating profit
Profit before tax
Profit for the period
Profit for the period attributable toowners of the parent

[Terumo Corporation] Financial Results for the First Three Quarters of the Fiscal Year Ending March 31, 2019: Reference(million yen)
Regional sales
Q1-Q3
FYE3/2018

Q1-Q3
FYE3/2019

Growth(%)

Growthexcluding
impact of forex
translations(%)

142,872

142,245(0.4)(0.4)

Europe86,11988,169

2.4

2.7

Americas126,290

129,677

2.7

4.1

Asia, outside Japan

81,671

83,517

2.3

4.1

Overseas total

294,082

301,364

2.5

3.7

Total

436,955443,609

1.5

2.3

JapanRevenue
Revenue totaled 443.6 billion yen, an increase of 1.5% year on year.
Revenue decreased in Japan. Revenue from General Hospital Company trended briskly with the demand in
surgical product domains and the alliance business with other pharmaceutical companies. However, theCardiac and Vascular Company suffered the impact of NHI reimbursement prices revision and shipping delays
at the Ashitaka factory.
Revenue increased overseas. Although there was negative impact from shipping delays at the Ashitaka
factory, performance was driven by brisk revenue of neurovascular business in the Cardiac and VascularCompany and alliance business in the General Hospital Company.
Gross profit
Gross profit came to 242.2 billion yen, an increase of 1.5% year on year, due to an increase in revenue.
Adjusted operating profit
In the period under review, adjusted operating profit came to 91.2 billion yen, a decline of 6.6% year on year,
due to an increase in selling, general and administrative expenses, particularly research and developmentexpenses.
That being said, adjusted operating profit factors out amortization expense for intangible assets obtained
during acquisitions and one-off income and expenses from operating profit. In addition, adjusted operating
profit is consistent with segment profit. We are disclosing adjusted operating profit as we are using it as anearnings management indicator.
Operating profit
Operating profit totaled 78.5 billion yen, a deterioration of 9.4% year on year due the decline in adjusted
operating profit.
Profit before taxProfit before tax was 75.0 billion yen, a decrease of 12.4% year on year. This reflects the posting of a forex
translation loss, versus a forex translation gain in the same period a year earlier.

[Terumo Corporation] Financial Results for the First Three Quarters of the Fiscal Year Ending March 31, 2019: Reference

Profit for the period attributable to owners of the parent
Profit for the period attributable to owners of the parent was 56.5 billion yen, a decrease of 26.6% year onyear. In addition to a decrease in profit before tax, there was a transitional decline in corporate tax owning to areevaluation of deferred tax assets and liabilities reflecting the tax reform in the United States during the same
period of the previous fiscal year.
Revenue results by reporting segment are as follows:(million yen)
Q1-Q3
FYE3/2018

Q1-Q3
FYE3/2019

Growth(%)

Growthexcluding
impact of forex
translations (%)

Revenue

240,038

240,957

0.4

1.1(Japan)40,54835,373(12.8)(12.8)(Overseas)

199,490

205,584

3.1

3.9

Revenue

120,231

125,869

4.7

5.0(Japan)

93,79397,753

4.2

4.2(Overseas)

26,43828,1166.3

7.7

Revenue

76,51076,5910.1

2.1(Japan)

8,368

8,950

7.0

7.0(Overseas)

68,141

67,640(0.7)

1.5

Segment

Cardiac andVascularCompanyGeneral
HospitalCompany
Blood
Management
Company

Cardiac and Vascular Company
Revenue in Cardiac and Vascular Company totaled 241.0 billion yen, an increase of 0.4% year on year.
Despite the impact of NHI reimbursement price revisions and shipping delays at the Ashitaka factory,
performance by the neurovascular business was favorable.
General Hospital CompanyGeneral Hospital Company revenue was 125.9 billion yen, an increase of 4.7% year on year. In the hospitalsystems business, sales of I.V. solution, AdSpray the spray type adhesion barrier, and Acelio an
acetaminophen antipyretic analgesic trended briskly. In addition, there has been an expansion in the alliancebusiness with pharmaceutical companies.
Blood Management Company
In the Blood Management Company revenue totaled 76.6 billion yen, an increase of 0.1% year on year.
Although revenue from the therapeutic apheresis declined due to particularly high demand in the UnitedStates during the same period of the previous year, sales of blood center products were firm in Japan and Latin
Americas.[Terumo Corporation] Financial Results for the First Three Quarters of the Fiscal Year Ending March 31, 2019: Reference(2) Overview of Consolidated Balance Sheets
Total assets at the end of the first three quarters were 1,129.8 billion yen, an increase of 50.8 billion yen
versus March 31, 2018. This was mainly because property, plant and equipment along with goodwill andintangible assets increased by 32.4 billion yen on capital expenditures for production capacity andinvestments in new IT systems. The increase of total asset also reflects transitions in forex owing todepreciation in the yen’s value versus the US dollar since the end of the previous fiscal year.
Total liabilities were 457.5 billion yen, down 71.1 billion yen. This decrease was mainly attributable to a 60.5billion-yen decline in bonds and borrowings due to the conversion of convertible bonds.
Total equity was 672.4 billion yen, an increase of 121.9 billion yen. This increase was owing to an increase of
65.1 billion yen due to the conversion of convertible bonds (decline in treasury stock due to its allocation forconversion), and an increase of 20.5 billion yen reflecting forex translation gains at overseas sales offices,owing to impact mainly from the forex market.
(3) Forecasts, including the Consolidated Financial Results for the Fiscal Year Ending March 31, 2019
We are reiterating the consolidated financial forecasts we released on August 8, 2018. We anticipate an
ongoing murky business environment including changes in the environment surrounding the medical device
and pharmaceuticals industries, and forex rate trends. However, to achieve our group goals, we plan to pourenergies into the development of high added-value products that will boost the quality and efficiency ofhealthcare, sales expansion, continuous improvement to manufacturing costs, and effective use of selling,
general and administrative cost.