February 6, 2024

Consolidated Financial Statements – Summary(Nine months ended December 31, 2023)
This document is an English translation of the Japanese-language original. All financial information has been
prepared in accordance with accounting principles generally accepted in Japan.
Company Name:GUNZE LIMITED

Securities Code:3002

Stock Market Listings:

Tokyo

URL:

https://www.gunze.co.jp/

Representative:

Toshiyasu Saguchi, President and Representative Director

Contact:

Junko Nakashima, General Manager, Corporate Communications

Tel:+81 (6) 6348-1314

Filing of Quarterly Securities Report (Shihanki hokokusho) (Scheduled):

February 13, 2024

Start of Distribution of Dividend (Scheduled):–

Preparation of Supplementary Materials for Quarterly Financial Results:

No

Holding of Presentation of Quarterly Financial Results:

No

1. Consolidated Operating Results for the nine months ended December 31, 2023 (April 1, 2023 to
December 31, 2023)(1) Consolidated operating results(Amounts less than one million yen are omitted)(Percentages represent year-over-year changes)

Net sales

Operating profit

Nine months ended¥ millions%¥ millions%
December 31, 2023
101,450 (2.3)
6,168 28.8
December 31, 2022
103,843 12.0
4,787 (12.1)
Note: Comprehensive income
Nine months ended December 31, 2023: ¥6,959 million [(1.9)%]
Nine months ended December 31, 2022: ¥7,095 million [15.8%]
EPS
Nine months ended
December 31, 2023
December 31, 2022¥

233.96224.23

Ordinary profit

Profit attributable toowners of parent¥ millions¥ millions

%

6,085
4,976

22.3
(16.1)

%

3,985
3,871

2.9
(41.3)

Diluted EPS¥
233.43223.69(2) Consolidated financial position
Total assets

Net assets¥ millions¥ millions%¥

121,344
117,691

71.7
69.8

7,061.80
6,789.78

As of December 31, 2023
166,427
As of March 31, 2023
165,927
Reference: Total equity
As of December 31, 2023: ¥119,329 million

Equity ratio

Net assets per share

As of March 31, 2023: ¥115,757 million

2. Dividends
Annual dividends per share (¥)
1st quarter-end

2nd quarter-end

3rd quarter-end

Year-end

Total

¥

¥

¥

¥

¥

FY2022−−−147.00
FY2023−−−
FY2023 (projected)
150.00(Note) Revision to the projected dividends announced most recently: None

147.00150.003. Projected results for FY2023 (April 1, 2023 to March 31, 2024)
Net sales
FY2023 full year

Operating profit%¥ millions%¥ millions%

140,000

2.9

7,500

29.0

7,500

24.6

Profit attributable toowners of parent
FY2023 full year

Ordinary profit¥ millions

EPS¥ millions

%

¥

4,800

6.6

282.32(Note) Revision to the projected results announced most recently: None

Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries during the period
accompanied by changes in the scope of consolidation): No(2) Application of an accounting method specific to the preparation of quarterly consolidated financial
statements: Yes(3) Changes in accounting policies, changes in accounting estimates, and restatement after error corrections(a) Changes in accounting policies due to revisions to accounting standards and other regulations: No(b) Changes in accounting policies other than (a) above: No(c) Changes in accounting estimates: No(d) Restatement after error corrections: No(4) Number of shares issued and outstanding (common stock)(a) Number of shares at the end of period (including treasury stock):
As of December 31, 2023: 17,293,516 shares
As of March 31, 2023: 17,293,516 shares(b) Treasury stock at the end of period:
As of December 31, 2023: 395,664 shares
As of March 31, 2023: 244,692 shares(c) Average number of shares during the period:
Nine months ended December 31, 2023: 17,033,272 shares
Nine months ended December 31, 2022: 17,266,660 shares* This summary of quarterly consolidated results is exempt from the quarterly review procedures by certified
public accountants or an audit corporation.
* Notes regarding the proper use of projections of the results and other matters
Projections of results and future developments are based on information available to the Company at the current
time, as well as certain assumptions judged by the Company to be reasonable. Various factors could cause
actual results to differ materially from these projections. For the assumptions that form the basis of the projected
results and notes regarding the use of projections, see “(3) Explanation of Consolidated Financial Results
Forecast and Other Forward-looking Information” of “1. Qualitative Information on Quarterly Financial
Results for the Period under Review” on page 3 of attached materials.

(Attachment)
Table of Contents
1. Qualitative Information on Quarterly Financial Results for the Period under Review ................................2(1) Explanation of Business Results ...........................................................................................................2(2) Explanation of Financial Position .........................................................................................................3(3) Explanation of Consolidated Financial Results Forecast and Other Forward-looking Information ......3
2. Quarterly Consolidated Financial Statements and Primary Notes ...............................................................4(1) Quarterly Consolidated Balance Sheets ................................................................................................4(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements ofComprehensive Income .........................................................................................................................6
Quarterly Consolidated Statements of Income ......................................................................................6
For the nine months ended December 31 ............................................................................................6
Quarterly Consolidated Statements of Comprehensive Income ............................................................7
For the nine months ended December 31 ............................................................................................7(3) Notes to Quarterly Consolidated Financial Statements .........................................................................8(Notes regarding assumptions of continuing operations) ...................................................................8(Notes in the case of significant changes in shareholders’ equity) .....................................................8(Application of an accounting method specific to the preparation of quarterly consolidated financial
statements) ..........................................................................................................................................8(Changes in accounting policies, changes or restatement of accounting estimates) ..........................8(Notes to quarterly consolidated statements of income) ....................................................................8(Segment information, etc.) ................................................................................................................9(Significant subsequent events) ........................................................................................................10

1

1. Qualitative Information on Quarterly Financial Results for the Period under Review(1) Explanation of Business Results(Overview of Results for the Period under Review)
During the nine months ended December 31, 2023 (April 1, 2023 - December 31, 2023), the Japanese economy
was on a moderate recovery path, as social and economic activities progressed toward normal primarily owing to
the easing of restrictions on activities resulting from the downgrade of COVID-19 to the Category V. The
economic outlook, however, remains unclear due to factors including the rise in prices associated with soaring
raw material prices against a backdrop of the geopolitical problems, and the impact of the yen’s depreciation due
to the differences in monetary policies in Japan and overseas, as well as concerns of a slowdown in the overseas
economy.
Amid this operating environment, the GUNZE Group continued to pursue the four basic strategies of “Creationof new value,” “Capital cost-focused management,” “Evolution of corporate constitution,” and “Environmentally
responsible management” in the second year of its new medium-term management plan, “VISION 2030 stage 1.”
By segment, the functional solutions business was impacted by the slowdown in demand for films due to rising
prices and a stagnant printer market in the office equipment market. In the medical business, while sales of medicallasers struggled, sales of new products of bioabsorbable medical materials were strong and sales expandedfavorably in China. In the apparel business, profitability improved as the Company proceeded with price revision
including adding value to its products and business restructuring. The lifestyle creations business performed
strongly thanks to the recovery of peoples’ movement.
Consequently, for the period under review, net sales decreased by 2.3% year-on-year to ¥101,450 million,
operating profit increased by 28.8% year-on-year to ¥6,168 million, ordinary profit increased by 22.3% year-onyear to ¥6,085 million on a consolidated basis. In addition, although business restructuring expenses of ¥1,677
million (extraordinary losses) were recorded due to the transfer of shares of a consolidated subsidiary in theelectronic components business, profit attributable to owners of parent increased by 2.9% year-on-year to ¥3,985
million, mainly due to the recording of ¥1,372 million in income taxes - deferred (gain) for deductible temporary
difference related to investments in subsidiaries.
(Results by Business Segment)
Categories of the reportable segments have been changed starting from the first quarter of the fiscal year ending
March 31, 2024. The following year-on-year comparison has been made using the figures for the corresponding
period of the previous fiscal year that were reclassified based on the revised reportable segments.
[Functional Solutions]
In plastic films, sales of packaging films in the US remained strong, although the business was impacted bystagnant demand in Japan and Asia. In engineering plastics, although sales to the office equipment market
stagnated, products for semiconductors and general industries performed strongly. Electronic components bore
the brunt of a slowdown in the Chinese economy and stagnant PC market.
As a result of the above, the functional solutions business recorded net sales of ¥37,348 million (down by 2.3%
year-on-year) and operating profit of ¥4,506 million (down by 12.3% year-on-year).
[Medical]In the medical business, although orders for medical lasers decreased primarily due to the decreased number of
openings of aesthetic and medical institutions after the COVID-19 pandemic, market penetration of new products
including adhesion prevention agent progressed with the recovery of the mainstay domestic medical application
market, and sales of bioabsorbable medical materials grew in China.
As a result of the above, the medical business recorded net sales of ¥8,768 million (up by 7.1% year-on-year)2and operating profit of ¥1,627 million (up by 4.9% year-on-year).
[Apparel]In the apparel business, although sales of autumn and winter items struggled due to the record-breaking latesummer heat and mild winter, products sold throughout the year appealing for differentiation from others
performed strongly. In addition, the e-commerce and the channel for company-owned stores, which are being
strengthened, have continued to grow, and the Company will continue to pursue growth strategies through a shift
to the Direct to Consumer channel. In innerwear, high value-added products that aligned with customer needs
performed strongly. In legwear, the Company has been continuously advancing structural reforms in an effort toimprove profitability.
As a result of the above, the apparel business recorded net sales of ¥46,444 million (down by 1.2% year-onyear) and operating profit of ¥2,017 million (up by 454.8% year-on-year).
[Lifestyle Creations]
The real estate category recorded a decline in revenue due to the impact of sales of idle land redevelopment in
the previous fiscal year. Both the shopping center and the sports club businesses are back on the recovery trackfollowing the recovery of peoples’ movement.
As a result of the above, the lifestyle creations business recorded net sales of ¥9,454 million (down by 13.8%
year-on-year) and operating profit of ¥552 million (up by 33.0% year-on-year).
(2) Explanation of Financial Position
As of December 31, 2023, total assets were ¥166,427 million, an increase of ¥500 million compared to the endof the previous fiscal year. The main components of the increase included a ¥1,871 million increase in notes andaccounts receivable - trade, and contract assets, a ¥1,407 million increase in merchandise and finished goods, anda ¥1,752 million increase in other in investments and other assets (deferred tax assets, etc.), while the main
components of the decrease were a ¥2,199 million decrease in investment securities primarily due to sale of crossshareholdings and a ¥2,165 million decrease in other current assets (accounts receivable-other, etc.).
Total liabilities were ¥45,082 million, a decrease of ¥3,152 million compared to the end of the previous fiscal
year. The main components of the increase included a ¥1,602 million increase in provision for businessrestructuring and a ¥1,112 million increase in income taxes payable, while the main components of the decrease
were a ¥2,774 million decrease in long- and short-term borrowings including commercial papers and a ¥1,642
million decrease in notes and accounts payable - trade.
Net assets were ¥121,344 million, an increase of ¥3,652 million compared to the end of the previous fiscal year.
The main components of the increase included the recording of profit attributable to owners of parent amounting
to ¥3,985 million and a ¥2,167 million increase in foreign currency translation adjustment, while the main
components of the decrease included dividends paid of ¥ 2,505 million.
(3) Explanation of Consolidated Financial Results Forecast and Other Forward-looking Information
Because the consolidated financial results for the period under review have been almost in line with expectations,the Company has decided not to change its earlier consolidated financial results forecast for the fiscal year ending
March 31, 2024, which was announced on May 12, 2023.

3

2. Quarterly Consolidated Financial Statements and Primary Notes(1) Quarterly Consolidated Balance Sheets(Million yen)
As of March 31, 2023
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade, and contract
assetsMerchandise and finished goods
Work in process
Raw 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
Land
Other, net
Total property, plant and equipment
Intangible assets
Investments and other assets
Investment securities
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

4

As of December 31, 2023

11,547

11,24327,12929,001

24,114
7,128
7,054
6,622
(16)
83,58025,522
7,594
6,442
4,457
(18)
84,24236,657
10,39810,446
5,614
63,117
1,446

36,06910,515
10,502
6,041
63,1301,724

11,6986,151(67)
17,782
82,346
165,927

9,498
7,904
(72)
17,33082,185
166,427

(Million yen)
As of March 31, 2023
Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term borrowings
Commercial papers
Current portion of long-term borrowings
Income taxes payable
Provision for bonuses
Provision for business restructuring
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Retirement benefit liability
Long-term leasehold and guarantee deposits received
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Share acquisition rights
Non-controlling interests
Total net assets
Total liabilities and net assets

5

As of December 31, 2023

10,010
6,077
−
438
263
1,353
−
11,90730,052

8,368
322
3,300
485
1,376
444
11,511
27,412

8,638
4,494
4,220
830
18,183
48,235

8,272
4,592
4,092
714
17,67045,082

26,071
6,566
78,972(1,044)
110,566

26,071
6,568
80,451(1,795)111,296

2,464
(144)
(13)
2,941
(56)
5,191
124
1,808
117,691
165,927

2,915
43
(13)
5,108
(21)
8,033
124
1,890
121,344
166,427

1,602

(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements ofComprehensive Income
Quarterly Consolidated Statements of Income
For the nine months ended December 31(Million yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Rental income from non-current assets
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses
Rental expenses on non-current assets
Foreign exchange losses
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sale of non-current assets
Gain on sale of investment securities
Other
Total extraordinary income
Extraordinary losses
Loss on sale and retirement of non-current assets
Loss on sale of investment securities
Loss on sales of investments in capitalBusiness restructuring expenses
Settlement money for under-reporting water amount
Loss on COVID
Other
Total extraordinary losses
Profit before income taxes
Income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

For the nine months ended
December 31, 2022
103,843
72,93630,907
26,1194,787

For the nine months ended
December 31, 2023
101,450
69,14332,306
26,138
6,168

36
404
292
2
195
930

62
291
297
−
106
757

152
283
−
306
741
4,976

192
288
60
298
840
6,085

351
419
14
785

7
723
−
731

224
7
40
43
−
114
−
429
5,332
1,439
3,893
21
3,871

216
−
−
*1 1,677*2 534
−
22
2,451
4,366
347
4,018
33
3,985

6

Quarterly Consolidated Statements of Comprehensive Income
For the nine months ended December 31(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
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests

For the nine months ended
December 31, 2022
3,893

For the nine months ended
December 31, 2023
4,018

871
(196)
2,519
7
3,202
7,095

450
188
2,266
35
2,940
6,959

6,914

6,826

181

132

7

(3) Notes to Quarterly Consolidated Financial Statements(Notes regarding assumptions of continuing operations)None applicable(Notes in the case of significant changes in shareholders’ equity)
None applicable(Application of an accounting method specific to the preparation of quarterly consolidated financial statements)(Calculation of income tax expenses)
The Company calculates income tax expenses by reasonably estimating the effective tax rate expected to be
imposed on profit before income taxes for the fiscal year ending March 31, 2024 and then multiplying profit before
income taxes for the nine months ended December 31, 2023 by the effective tax rate thus estimated.
However, in cases where calculating tax expenses using the estimated effective tax rate yields a result that isnotably lacking rationality, tax expenses will be calculated using the statutory effective tax rate.
Income taxes - deferred are included in income taxes.
(Changes in accounting policies, changes or restatement of accounting estimates)
None applicable(Notes to quarterly consolidated statements of income)*1 Business restructuring expenses
Loss associated with business restructuring including the transfer of shares of a consolidated subsidiary in theelectronic components business*2 Settlement money for under-reporting water amountPayment of unpaid sewage fees, etc. due to the discovery of under-reporting of water amount at a hot spring
facility of a consolidated subsidiary8

(Segment information, etc.)[Segment Information]
Nine Months Ended December 31, 2022 (April 1, 2022 - December 31, 2022)
1. Information on Net Sales and Profit/Loss of Each Reportable Segment(Millions of yen)
Reportable segments
Functional
solutions

MedicalLifestylecreationsApparelTotal

Adjustment(Note 1)

Consolidated(Note 2)

Net sales
Sales to customers

37,8468,185

46,88910,922

103,843−

103,843

Intersegment sales andtransfers

392

2

141

49

586

(586)

−

Total

38,2398,187

47,03010,972

104,430(586)

103,843

5,138

1,551

363

415

7,470

(2,682)

4,787

Segment profit

Notes:
1. The ¥(2,682) million segment profit adjustment consists of overall costs not allocated to reportable segments. Overall costs refer
to SG&A expenses not allocated to reportable segments.
2. Segment profit total was adjusted to be consistent with the operating profit recorded on the Quarterly Consolidated Statements ofIncome.

Nine Months Ended December 31, 2023 (April 1, 2023 - December 31, 2023)
1. Information on Net Sales and Profit/Loss of Each Reportable Segment(Millions of yen)
Reportable segments
Functional
solutions

MedicalApparelLifestylecreations

Total

Adjustment(Note 1)

Consolidated(Note 2)

Net sales
Sales to customers

36,955

8,766

46,314

9,413

101,450−

101,450

Intersegment sales andtransfers

393

1

130

40

566

(566)

−

Total

37,3488,768

46,444

9,454

102,016(566)

101,450

4,506

1,627

2,017

552

8,704

(2,536)

6,168

Segment profit

Notes:
1. The ¥(2,536) million segment profit adjustment consists of overall costs not allocated to reportable segments. Overall costs refer
to SG&A expenses not allocated to reportable segments.
2. Segment profit total was adjusted to be consistent with the operating profit recorded on the Quarterly Consolidated Statements ofIncome.

2. Matters on Changes in Reportable Segments, etc.
To clarify its position as a growth driver in the ongoing medium-term management plan, “VISION 2030 stage
1,” the medical business, which was previously included in the “Functional solutions” segment, has become aseparate the “Medical” segment starting from the first quarter of the fiscal year ending March 31, 2024. As a result,
the reportable segments of the GUNZE Group comprise “Functional solutions,” “Medical,” “Apparel,” and“Lifestyle creations.”
Segment information for the nine months ended December 31, 2022 has been prepared based on the revised
reportable segments.
9

(Significant subsequent events)
None applicable10