新日本製薬（4931） – [Delayed]Supplementary Briefing Material on Financial Results for the Second Quarter of the Fiscal Year Ending September 2022

Supplementary Briefing Material on Financial Results for the Second Quarter ofthe Fiscal Year Ending September 2022May 9, 2022Shinnihonseiyaku Co., Ltd.Securities Code: 4931Tokyo Stock Exchange Prime Market© Shinnihonseiyaku Co., Ltd.Summary of Financial Results for the Second Quarter of the Fiscal Year Ending September 2022© Shinnihonseiyaku Co., Ltd.18,001 million yen (up 7.4% year on year*)Net sales◼ Achieved the highest first half net sales (record-high first half net sales even excluding consolidation effects). ◼ Also, with the quarterly net sales growth rate at 4.7% in Shinnihonseiyaku Co., Ltd. alone (Jan. to Mar.), Net salesgrowth has continued.◼ Mail order drove the net sales increase due to steady progress in acquiring new customers and a rise in spending per repeat customer.Operating profit 1,675 million yen (up 19.8％ year on year)◼ A record-high first half profit since the listing on a stock exchange, considerably pushed up by the effect of higher sales resulting from the growth of net sales.◼ Continued aggressive marketing investment as in the case of 1Q while closely monitoring return on Expenses/ Profitinvestment.◼ Full-year profit plan stays unchanged in anticipation of an expanded investment in the second half althoughprofit growth is outpacing the plan.◼ With PERFECT ONE, we successfully acquired new customers, continuing form 1Q, through Cushion Foundation.2Q Business Highlights◼ With PERFECT ONE FOCUS, our sales scale has expanded due to an increasing number of stores handling the product and the strong performance of EC.◼ With Fun and Health, our acquisition of new customers has expanded as marketing investment increased to push strong sales trend.◼ Started a new business as a brand to be developed in the femcare area.*Compared with the results for the fiscal year ended September 2021, when the new revenue recognition standards were adopted1INDEX© Shinnihonseiyaku Co., Ltd.1. Summary of Second Quarter Financial Results2. Second Quarter Business Highlights3. Plan for the Fiscal Year Ending September 20224.Initiatives for ESGAPPENDIX21. Summary of Second Quarter Financial Results© Shinnihonseiyaku Co., Ltd.3Summary of Second Quarter Financial Results© Shinnihonseiyaku Co., Ltd.Net sales achieved a record high for the first half, up 7.4% year on year and grew at a rate of 5.1% excluding consolidation effects.All levels of profit significantly surpassed a year earlier due to the effect of higher sales, elevating the ordinary profit rate to 9.4%.(Unit: Million yen)ItemsFirst half of FY ended Sept. 2021 (non-consolidated)(based on the formerstandards)First half of FY ended Sept. 2021(non-consolidated)(based on new revenue recognition standards)First half of FY ending Sept. 2022(consolidated) (based on new revenue recognition standards)Year-on-year comparisonComparison against planPlanResultsChangesChanges(%)Net Sales16,57516,75918,23318,001+1,241+7.4%Cosmetics 15,50315,67516,76316,417+742+4.7%Healthcare1,0721,0841,4701,583+499+46.0%Operating profit1,3981,3981,2151,675+277+19.8%Ordinary profit1,4301,4301,1661,694+263+18.4%Ordinary profit rate8.6%8.5%6.4%9.4%0.9pt―Profit (attributable toowners of parent) 9659657941,137+171+17.7%-232-345+112+459+5273.0pt+3424Summary of Second Quarter Financial Results -Supplemental Data© Shinnihonseiyaku Co., Ltd.With continued strong acquisition of new customers, mail order drove the sales increase. Overseas, progress is slower than expected in China and ASEAN.In costs, while marketing investment was expanded (up 270 million yen year on year), operating expenses were reduced.(Unit: Million yen)First half of FY ended Sept.2021 (non-consolidated)(based on the formerstandards)First half of FY ended Sept.2021(non-consolidated)(based on new revenue recognition standards)First half of FY ending Sept. 2022 (consolidated) (based on new revenue recognition standards)Year-on-year comparisonPlanResultsChangesChanges(%)Comparison against planMail order15,28615,470Direct store/WholesaleOverseas85543385543316,0261,61059516,3921,2213871,9461,9662,6042,400+434+22.1%-2035,2701,7951,9611,2685,2701,7952,1451,2685,3472,5282,0521,4174,9912,3462,1081,245+921+366-46-278+550-36-23+6.0%+42.8%-10.7%-5.3%+30.7%-1.7%-1.8%+365-389-208-356-181+55-1725ItemsOverseas and domesticEC salesAdvertising expensesSales promotion expensesFF cost*Call center costs*FF cost = Order fulfillment cost[Reference] Trends in Quarterly Net Sales© Shinnihonseiyaku Co., Ltd.Although progress overseas is slower than expected, a high level quarterly growth rate has been kept due to the continued robust performance of mail order.Year-on-year comparison+8.1%*Growth rate excluding consolidation effects: +5.6%Consoli-dation effects+6.7%year-on-year*Growth rate excluding consolidation effects: +4.7%Consoli-dation effectsYear-on-year comparison+5.6%*Growth rate excluding consolidation effects: +3.0%Consoli-dation effectsYear-on-year comparison-2.7％Year-on-year comparison-0.3%Year-on-year comparison-0.3%FYE Sept. 20201QFYE Sept. 2021FYE Sept. 20202QFYE Sept. 2021FYE Sept. 20203QFYE Sept. 2021FYE Sept. 20204QFYE Sept. 2021FYE Sept. 20211QFYE Sept. 20221Q2Q3Q4Q1QFYE Sept. 20212QFYE Sept. 20222Q[Based on new revenue recognition standards]6Summary of Second Quarter Financial Results – Operating Profit Change Factor AnalysisResults for the first half of the fiscal year ended September 2021 are based on the new revenue recognition standards.Steady progress in mail order channels significantly contributed to a higher sales effect of 1,050 million yen.Although the increase in marketing investment is the factor that reduced profit by 270 million yen, profit exceeded the first half plan by 450 million yen.10.52.74.81.45.51.5© Shinnihonseiyaku Co., Ltd.(Unit: 100 million yen)Factor in profit growthFactor in profit decline[Reference] Vs. 2Q plan+37.8%(+450 million yen)16.713.921/9期 上期First half of FY ended Sept. 2021Operating profit＜参考＞(non-consolidated)Sales increaseGross marginAdvertisingexpensesPromotionexpensesFFコスト効率化*FF cost efficiency enhancement*Other SG&A expenses22/9期 上期First half of FY ending Sept. 2022Operating profit(consolidated)* Of FF cost, the efficiency improvement effect in shipping and delivery costs and agency fees (payment commissions)7© Shinnihonseiyaku Co., Ltd.(Unit: 100 million yen)ネットキャッシュNet cash自己資本比率Equity ratio71.2%113.368.9%114.172.4%109.9Status of Balance SheetItemsEnd of FYended Sept.2020(non-consolidated)End of FYended Sept.2021(consolidated)2Q-end of FY ending Sept.2022(consolidated)Current assets16,21118,52818,09612,27113,65213,037(Unit: Million yen)Changes from previous fiscal year-endCash and depositsAccounts receivable-tradeInventoriesNon-current assetsTotal assetsLiabilitiesTrade payablesInterest-bearing debt19,95623,19722,7962,6071,1933,7445,6885099363,1961,4044,6697,0235272,2382,7881,9414,7006,1355312,039-431-614-407+537+30-400-887+3-199+487+99-400Net assets14,26716,17416,661Treasury shares-299-852-752Total liabilities and net assets19,95623,19722,7962020/9期20/9期FY ended Sept. 期末（個別）2020.期末（個別）(non-consolidated)＜参考＞2021/9期21/9期FY ended Sept. 期末（個別）2021期末（連結）(consolidated)2022/9期22/9期2Q of FY ending 上期時点Sept. 2022上期末（連結）（連結）(consolidated)82. Second Quarter Business Highlights© Shinnihonseiyaku Co., Ltd.9PERFECT ONEAcquisition of new customers has remained strong from 1Q, and the trend was sped up by the launch of a new product© Shinnihonseiyaku Co., Ltd.Trend in the number of newly acquired customers in mail order*Year-on-year+45%Released on April 15, 2022Wrinkle and Cover Cushion FoundationPOINT１Even when making up, Wrinkle improvement×Skin whitening carePOINT2HighCoverage effectPOINT3Low color migration to face masks2Q3Q4Q1QFYE Sept. 2021QuarterlyaverageFYE Sept. 20211QFYE Sept. 20222QCushion Foundation has continued to drive the increase in acquisition of new customers from 1Q* Mail order excluding EC (year-on-year growth rate is 44% when including EC)New release of an item with a wrinkle improvement function in the cushion foundation market with a high growth rateAim to achieve the plan by speeding up acquisition of new customers through increased investment 10PERFECT ONESpending per subscriber increased as the ratio of subscribers buying multiple products rose© Shinnihonseiyaku Co., Ltd.The ratio of subscribers buying multiple products rose since the call center proposed simple steps for them to feel the actual effect in addition to raising accuracy in product proposals.Trends in the ratio of subscribers buying multiple products*¹ and spending per subscriber*²Proposing to use products in 3 steps (strengthen cross-selling)Aim to further elevate spending per customer to expand salesCompared tofull-year averageof FYE Sept. 2021+2.3ptSimple steps for feeling actual effectRatio of subscribers buying multiple productsSpending per subscriberSpending per subscriber increased about 200 yen from the full-year average of FYE Sept. 2021Highest spending per customer since IPOFull-year average in FYE Sept. 20211QFYE Sept. 20222QFYE Sept. 2022*1: Number of subscribers buying multiple products / Number of subscribers*2: Mail order excluding ECSTEP1RemoveSTEP2MoisturizeSTEP3AttractCleansing soap& Cleansing liquidAll-In-One GelCushion Foundation11PERFECT ONE FOCUSSales scale has expanded due to more stores handling the product and the good performance of EC. New product put on market in April© Shinnihonseiyaku Co., Ltd.Trend of sales of PERFECT ONE FOCUSWholesale ECFrom 1Q2.5 times3 times in EC salesECWholesale Scend of a popup eventNumber of stores handling the product increased by 1,500 to 4,800*¹The product became a topic in social media due to measures using campaigns and influencers (2Q EC sales exceeded the plan by 40%)1QFYE Sept. 20222QFYE Sept. 2022On April 1, 2022, released “Sensitive Line” focused on “pores in sensitive skin”All-in-One Gel and Cleansing Balm were put on marketAim to expand users in their 20s and 30s by expanding into variety shops in addition to DS*² and by stepping up promotion*1: Compared with the end of December 2021. Results as of the end of March 2022*2: Drugstores12Fun and HealthInvestments were increased. Steady progress in acquiring new customersTrend in the number of healthcare new customers*¹BODY AURAExpansion of number of stores handling Body Aura mainly in major DS chains© Shinnihonseiyaku Co., Ltd.Year-on-year increase 2.3 times(Left) Measure for linking with the app of DS(Right) Selling page on Amazon1QFYE Sept. 20212Q3Q4Q1QFYE Sept. 20222QBy increasing the investment amount in advertising mainly for W Green Drink, the number of newly acquired customers considerably outpaced the previous year, making great progress.LP (Landing page)Example of POS advertisements in drugstoresThe number of stores handling the product has increased by 1,500 stores and has reached 4,000*².Step up marketing measures for expanding sell-out.Aim to expand sales in the second half by doubling down on investments.Pilot sales in convenience stores have started.Aim to expand sales by cultivating sales channels.13*1: Mail order excluding EC. *2: Compared with the end of December 2021. Results as of the end of March 2022 Wellness FoodNew initiatives for growth Booth in a trade showWholesale Expansion of stores handling the products and sales channelsDevelop new business partners through participation in Supermarket Trade Show 2022.Ongoing expansion of sales channels to major DS and variety shopsECExpansion into EC mallsMarch: Participated in Rakuten Super Sale for the first time.SNS marketing was set in motion.OverseasSituation of China, Taiwan and ASEAN© Shinnihonseiyaku Co., Ltd.2Qfirst half sales were affected by a delay in the approval process for NMPA application in China.ASEAN was influenced by the spread ofCOVID-19 infections.Outlook for second halfAn impact from lockdowns due to the spread of COVID-19 infections is expected to occur in China.Aim to maximize sales by starting sales of PERFECT ONE in preparation for a period when lockdowns are lifted.Postings in social media in China14FemcareNew Brand “COCOROOT” Launched- Developed considering opinions of female employees suffering premenstrual syndrome (PMS)© Shinnihonseiyaku Co., Ltd.The femtech market*¹ is expected to reach a global size of about 5 trillion yen*² by 2025, attracting attention.The amount of work lost due to female-specific health problems, such as PMS, reaches 491,100 million yen*³ in Japan and has manifested itself as a social issue.Aim to become a brand that contributes to solving social issues through business activities.Whereas many women feel a mental or physical abnormality due to menstruation, over half of them*⁴ replied that they did not take any countermeasures.Advance sales*⁵ started with “Makuake” to approach consumers who were sensitive to the latest trends from the launch.Do you feel mental or physical abnormality two weeks to a few days prior to menstruation?Do you take any countermeasures against mental and physical abnormality two weeks to a few days prior to menstruation?Yes 79%NoYesUsed to take countermeasuresReleased on March 30, 2022Supplement to Cherish Your Healthcalm mindday with a Helps you spend every *1: Including the femcare market*2: Quoted from CB INSIGHTS “The Femtech Market Map: 95+ Companies Shaping The Future Of Women’s Health & Wellness” (https://www.cbinsights.com/research/femtech-market-map/)*3: Work amount lost for a year from Ministry of Trade, Economy and Industry “Efforts related to women’s health in health management”*4: Survey by Shinnihonseiyaku. Period: April 2021.Number of people surveyed: 500 women from age 28 to 45. Method: Online survey*5: From March 8, 2022 to March 27, 2022153. Plan for the Fiscal Year Ending September 2022© Shinnihonseiyaku Co., Ltd.16Plan for the Fiscal Year Ending September 2022© Shinnihonseiyaku Co., Ltd.Net sales are set to shoot past the full-year plan through realizing the growth of mail orderThe full-year plan remains unchanged to be on the safe side concerning all types of profit on the assumption of expanding marketing investment for the second halfFY ended Sept.2021(based on theformer standards)FY ended Sept.2021(based on new revenue recognitionstandards)FY ending Sept. 2022(based on new revenue recognition standards)Results in thefirst halfFull-year plan(Unit: Million yen)Year-on-year change in thefull-year plan (%)Net salesItemsCosmeticsHealthcareOperating profitOrdinary profitOrdinary profit rateProfit (attributable to owners of parent)33,89931,5212,3783,4243,41410.1%2,31734,23231,8402,3923,4243,41410.0%2,31718,00116,4171,5831,6751,6949.4%1,13737,00034,1252,8743,0953,0208.2%2,067+8.1%+7.2%+20.1%-9.6%-11.5%ー-10.8%17Premises of Plan for the Fiscal Year EndingSeptember 2022© Shinnihonseiyaku Co., Ltd.The ratio of sales by channel has been changed in consideration of progress in direct store/wholesale and overseas for the first halfNet sales of mail order have been revised upward by doubling down on investment in Cushion Foundation and Fun and Health, in particularOperating expenses made steady progress, but remain changed to be on the safe side despite the assumption of growth in net sales of mail order(Unit: Million yen)ItemsFY ended Sept. 2021(based on theformer standards)FY ended Sept. 2021(based on new revenuerecognition standards)FY ending Sept. 2022(based on new revenue recognition standards)Results in thefirst halfFull-year planYear-on-year change in thefull-year plan(%)Mail orderDirect store/WholesaleOverseasOverseas and domesticEC salesAdvertising expensesSales promotion expensesFF costCall center costs30,9302,05491431,2722,04591416,3921,2213879,9083,8533,9352,5889,9083,8534,2762,5884,9912,3462,1081,24533,2212,82395410,1695,0664,1092,857+6.2%+38.1%+4.3%+2.6%+31.5%-3.9%+10.4%184,1174,1532,4004,980+19.9%4. Initiatives for ESG© Shinnihonseiyaku Co., Ltd.19Environment/Environmental Initiative in Cosmetics© Shinnihonseiyaku Co., Ltd.◼ Environmental response of PERFECT ONEEco-friendly bottles have expanded to reach about 70%*¹ of all bottles shipped.“Perfect One Recycle Program” was launched on April 1.Recycle empty bottles into bottles for new products*² with the cooperation of Beautycle, Co., Ltd.*1: From All-in-One Gel series*2: Products where horizontal recycling apply are Moisture Gel and Whitening Gel onlyFrom used bottles to ones for new productsFrom used bottles to ones for new productsFrom used bottles to ones for new productsFrom used bottlestobottles fornew productsBottleTo Bottle* Design idea of box for collecting bottles◼ Participation in greencosme NOIN SDGs Beauty EventExhibition event of socially responsible and eco-friendly cosmetics brands, organized by NOIN, Inc.Shinnihonseiyaku took part in the place to collect unnecessary cosmetics.Booth supporting the event20•••••APPENDIX© Shinnihonseiyaku Co., Ltd.21Our Strength: “Selling Power” of Mail Order Channels© Shinnihonseiyaku Co., Ltd.Develop new products swiftly, and during the introductory stage, run the PDCA cycle of pilot marketing at high speed.Grab a dominant market share in one breath within a short period before competition intensifies by ramping up advertising investment once a sign of becoming a hit product appears.Product life cycle management of our mail order channels[Reference]: Trend in cumulative sales Net salesCapture a large share within a short period by vertical launchOur product life cycle curveStabilized by a recurring revenue modelof Cushion FoundationSales sped up alongside an increase in investments (From FY22/1Q)Concentrate advertising investment“Sign of becoming a hit product”Pilot marketingAdvertising investment expanded centering on TV (From FY21/late 4Q)Pilot marketing(From FY21/3Q)Introductory stageGrowth stageMaturing stageDeclining stageTime h目tno月m かts11h目tno月mかdn22 h目tno月mかdr33 h目tno月mかht44 ]h目tn月omかht55 h目tno月mかht66 h目tno月mかht77 h目tno月mかht88 h目tno月mかht99 h目tno月mかht2211 h目tno月mかht0011 h目tno月mかht1111 22Our Strength: Recurring Revenue Model© Shinnihonseiyaku Co., Ltd.Recurring Revenue Model through periodic purchase of productsBuild a foundation for sales growth based on the acquisition of new customers through prioritizing advertising investment.Net sales7th Purchase6th PurchaseCRM4th Purchase5th PurchaseContinuous usage through regular purchasesSales growthTimeNew customerRegular purchases1st Purchase3rd Purchase2nd PurchaseAdvertising investment aimed at acquiring new customers(Focused on ROI)Advertising Investment23Our Strength: Marketing Utilizing Customer Database© Shinnihonseiyaku Co., Ltd.Utilize the database of approximately 5.5 million customers accumulated through continued acquisition of new customers.Implement strategies to maximize the asset value of the customer database, with a focus on the middle-and senior-age generations.Customer Base DevelopmentContinued acquisition of new customersAdvertising InvestmentNew Product DevelopmentCustomer Database (as of the end of FYE Sept. 2021)Middle age generation28%“Minimum life” generation 5%Approximately 5.5 millioncustomersThe middle- and senior-age generations account for 95%MarketingHealth & BeautyPropose comprehensive carePromote up-selling to high-performance productsPromote cross-selling of seasonally limited products, etc.Increase purchasefrequency through call center suggestionsActivation of database by promoting repurchases by dormantcustomersSenior generation: 67%• Stable demographic transition• Continued use of productsCreate synergies with new businessesSenior generation = aged 60s and over; Middle age generation = aged 40s and 50s; “Minimum life” generation = aged 30s and under24Conceptual Graph of Medium- to Long-term Growth (Medium-Term Management Plan)© Shinnihonseiyaku Co., Ltd.In the fiscal year ending September 2022, as the first year of VISION2025, the Medium-Term Management Plan, we will prioritize investments in brands to be developed and development of new business to nurture business and enhance the growth potential.Net sales 50 billion yenOrdinary profit rate 8.5%37 billion yen8.2%33.8 billion yen10.1%M&ABrands to be developed/business• PERFECT ONE FOCUS• Fun and Health• BODY AURA• Wellness Food• New brands (scheduled to be introduced in the future)Core brandPERFECT ONEOrdinary profit rate25FYE Sept. 2021FYE Sept. 2022FYE Sept. 2023FYE Sept. 2024FYE Sept. 2025VISION2025 (FYE Sept. 2022 – FYE Sept. 2025)Brand Strategy in the Beauty Care Field© Shinnihonseiyaku Co., Ltd.Provide beauty care tailored to diverse lifestyles of women that enables them to experience the effects through simple steps.STEP1RemoveSTEP2MoisturizeSTEP3AttractNet sales 800 million yen*Net sales 24 billion yen*Stable growth phaseNet sales 600 million yen*Growth expansion phasePERFECT ONENEWCleansing soap & liquidAll-In-One GelNEWNEWPERFECT ONEFOCUSAll-in-OneCushion FoundationCurrently planning development in the next phaseSmooth Cleansing BalmSmooth Watery Gel* Net sales for FY ended September 202126Cosmetics – Business Portfolio© Shinnihonseiyaku Co., Ltd.Cosmetics net sales target: 40 billion yen level (FY ending Sept. 2025)Mail orderECStoresOverseasSenior generation(60s and over)Middle age generation(40s and 50s)>noitareneg tegraT<“Minimum life” generation(20s and 30s)PERFECT ONENet sales for FYE Sept. 202538 billion yen levelNew areaHair careNew areaBeauty devicesMarketing investment policyImportance placed on investment efficiencyPERFECT ONE FOCUSFYE Sept. 2025 net sales at 3 billion yen levelInvestment policy Key investmentof which,overseas net sales in FYE Sept. 2025* 5 billion yen levelInvestment policyKey investment* Included in the net sales of PERFECT ONE for FYE Sept. 2025, which also include net sales of PERFECT ONE FOCUS27Brand Strategy in the Healthcare Field© Shinnihonseiyaku Co., Ltd.Provide healthcare that supports the extension of healthy life expectancy in the era of a 100-year life span and enables people to experience evidence-based effects.Health managementPreventionPre-symptomatic stateTreatmentRe-growth phase• Acquisition of new customers• Strengthening of cross-sellingBODYAURAGrowth phase• Expansion of MD• Expansion of distribution channelsFunandHealthWellnessFoodFemcareStable growth phase• Expansion of EC channels• Expansion of MDBusiness launch phase• Expansion of brand awareness • Expansion of MD• Creation of a market28Healthcare - Business PortfolioHealthcare net sales target: 10 billion yen level(FY ending Sept. 2025)© Shinnihonseiyaku Co., Ltd.Mail orderECStoresOverseasSenior generation(60s and over)Middle age generation(40s and 50s)>noitareneg tegraTWellnessFoodBODY AURAFYE Sept. 2025 net sales at 2 billion yen levelInvestment policy Expansion of investment amountNet sales for FYE Sept. 20251 billion yen levelInvestment policy Expansion of investment amountNew areas (sports, preventive medicine, etc.) and M&AFYE Sept. 2025 net sales at 3.5 billion yen levelInvestment policy Aggressive investment29Company OverviewCompany NameShinnihonseiyaku Co., Ltd.RepresentativeTakahiro Goto, President & Representative Director of the Board and Chief Executive OfficerEstablishedMarch 1992Head office1-4-7 Otemon, Chuo-ku, Fukuoka City, Fukuoka PrefectureShare capital4,158 million yen [as of March 31, 2022]ExecutivesMitsuyoshi Fukuhara, Senior Executive Director of the Board and Chief Operating OfficerSeiichiro Hatori, Director of the BoardKazuhiro Tagami, Director of the BoardMasayuki Kakio, Outside DirectorHaruki Murakami, Outside DirectorKazuyo Yunoki, Outside DirectorKeiichi Zenmyo, Outside Audit & Supervisory Board Member (full-time)Takashi Tanabe, Outside Audit & Supervisory Board MemberYuji Nakanishi, Outside Audit & Supervisory Board MemberBusiness profilePlanning, mail order, store sales and wholesale of cosmetics, health foods, and pharmaceuticals.BasesFukuoka (head office), Tokyo Office, eight direct stores, Yoshizuka Office and Logistics CenterGroup companies Flatcraft, Inc.Net sales33.89 billion yen [FY ended September 2021]Total assets22.79 billion yen [as of March 31, 2022]30Creating Healthy and Enriched Lives for People around the WorldVisionMissionAchieving the Greatest Possible Satisfaction and Trust from Our Customers, Making Our Employees Happy and Giving Them Dreams for the Future, as a Company That Contributes to Society, We Aim to Expand Our Efforts Far and Wide without LimitationDomainOne to One health & beauty-care.Creator of Lifestyles that Fosters Beauty and Good Health Through Database Marketing31HistoryDateMarch 1992Founded Shinnihonliving Co., Ltd. (currently Shinnihonseiyaku Co., Ltd.) as a company that planned and sold daily essentials in Higashi-Ori, Onojo City, Fukuoka Prefecture (share capital of 10 million yen).OverviewJuly 1994 Started sales of health foods by mail order.June 1996 Relocated the head office to Otogana-Higashi, Onojo City, Fukuoka Prefecture.December 2000 Commenced sales of basic cosmetics by mail order.April 2002 Renamed Shinnihonliving Co., Ltd. to Shinnihonseiyaku Co., Ltd.March 2003 Opened a logistics center in Yoshizuka, Hakata-ku, Fukuoka City, Fukuoka Prefecture.April Relocated the head office to Yoshizuka, Hakata-ku, Fukuoka City, Fukuoka Prefecture.May 2005 Started sales of cosmetics brand “RAffINE series.”May 2006 Relocated the head office to Akasaka, Chuo-ku, Fukuoka City, Fukuoka Prefecture.May Launched RAffINE Perfect One.October Established Iwakuni-Hongo Research Institute as the base for cultivation and research of medical plants.*1November Started sales of pharmaceuticals by mail order.March 2010 Opened its first direct store in Fukuoka PARCO shopping mall.July Opened a Tokyo sales office in Uchisaiwaicho, Chiyoda-ku, Tokyo (currently Tokyo Office).April 2012 Started wholesale of “RAffINE series.”October 2013 Relocated the head office to Otemon, Chuo-ku, Fukuoka City, Fukuoka Prefecture.April 2014 Changed the cosmetics brand name to “PERFECT ONE.”December 2016 Started sales overseas by mail order (Taiwanese market).February 2017 Was awarded the Steering Committee Award in the 7th “Company I Want to Cherish Most in Japan” Grand Prize.March PERFECT ONE All-in-One Gel series achieved the number one*2 sales in the Japanese all-in-one skincare market.September 2018 Started cross-border EC in the Chinese market.September Was awarded the top prize and the rookie of the year at the beauty awards hosted by Taiwan’s popular infotainment TV show “Queen.”June 2019 Listed on Tokyo Stock Exchange Mothers.January 2020 Relocated Tokyo Office to Marunouchi Building in Chiyoda-ku, Tokyo.December 2020 Changed listing market to the First Section of the Tokyo Stock Exchange.June 2021 Acquired shares of Flatcraft, Inc. and made it a consolidated subsidiary.*1: The institute was integrated into Yoshizuka Office (R&D Center) in June 2020. *2: Fuji Keizai “Cosmetics Marketing Handbook 2017” (actual manufacturer and brand market shares in the moisture section and the all-in-one section in 2016)32Financial HighlightsFinancial HighlightsFinancial closing month & yearSeptember 2018(non-consolidated)September 2019(non-consolidated)September 2020(non-consolidated)September 2021(consolidated)2Q of FY ending September 2022(consolidated)Total number of shares issuedShares1,009,63021,611,30021,611,30021,855,20021,855,200Net salesOrdinary profitProfitShare capitalNet assetsTotal assetsEquity ratioReturn on equityDividend payout ratioMillion yenMillion yenMillion yenMillion yenMillion yenMillion yen%%%Cash flows from operating activitiesMillion yenCash flows from investing activitiesMillion yenCash flows from financing activitiesMillion yenCash and cash equivalents at the end of the periodNumber of employees(excluding temporary employees and including seconded employees)Million yenPeopleNet assets per shareBasic earnings per shareDividend per shareYenYenYen31,2102,4911,7512504,1919,49143.651.820.11,415-420-4192,954361409.58174.4635.0033,5702,8221,8243,82612,75818,57568.721.615.41,992-9436,56710,576354590.37113.9917.5033,7283,2832,1223,82614,26719,95671.215.730.52,920-367-85112,271330662.9798.530.0033,8993,4142,3174,15816,17423,19768.914.530.22,071-1,35967213,652309747.07107.4532.518,0011,6941,1374,15816,66122,79672.413,037ーーーーーーーーーPrior-year ordinary profit is retroactively adjusted for changes in accounting policies33Disclaimer concerning the proper use of forecasts of business resultsThe content presented in this material is based on multiple assumptions and is not intended to promise or guarantee the realization of future planned numbers or measures.Contact for inquiries regarding this documentManagement Promotion Office, Shinnihonseiyaku Co., Ltd.TEL: 092-303-8318 FAX: 092-720-5819For inquiries, please use the inquiry form on the Shinnihonseiyaku website.We will reply to you as soon as we can.https://corporate.shinnihonseiyaku.co.jp/contact/34