BML : Consolidated Earnings Report for the Third Quarter of Fiscal 2020

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Disclaimer: This is a Japanese-English translation of the summary of financial statements of the Company produced for your convenience. Since no auditor audited this report, officially only the Japanese version is assumed to be the summary of financial statements of the Company. This summary does not constitute any guarantee and the Company will not compensate any losses and/or damage stemming from actions taken based on these statements. Should there be any discrepancy between the Japanese and English versions, the Japanese version is assumed to be correct.

February 10, 2021

CONSOLIDATED EARNINGS REPORT
FOR THE THIRD QUARTER OF FISCAL 2020
[Japanese GAAP]
Company Name:	BML, Inc.
Stock Listing:	Tokyo Stock Exchange
Stock Code:	4694
URL:	http://www.bml.co.jp
Representative:	Kensuke Kondo, President and Representative Director
Contact:	Norihisa Takebe, Executive Officer, General Manager of
Planning Division and Director
Tel: [phone]

Scheduled Date for Filing of Quarterly Report:	February 12, 2021
Scheduled Date for Payment of Dividends:	-
Creation of Supplementary Explanatory Materials:	None
Holding of Explanatory Meeting:	None
(Rounded down to nearest million yen)

1. Results for the Third Quarter of Fiscal 2020 (April 1, 2020 - December 31, 2020)

(1) Consolidated Business Results

(% indicates year-on-year changes)Net sales ¥ millionOperating incomeOrdinary incomeProfit attributable to owners of parent

%

¥ million

%

¥ million

%

¥ million

%

3Q of FY2020 3Q of FY2019

98,288 92,857

5.8 4.2

12,745 8,941

42.5 1.9

13,217 9,234

43.1 1.6

8,650 5,812

48.8 3.1

(Note) Comprehensive income: 3Q of FY2020

¥ 8,826 million / 40.1％

3Q of FY2019

¥6,299 million / 9.9％

Profit attributable to owners of parent per share Yen	Profit attributable to owners of parent per share (diluted) Yen
3Q of FY2020	212.90	212.67
3Q of FY2019	136.41	136.23

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(2) Consolidated Financial Position

Total assets (¥ million)	Net assets (¥ million)	Equity ratio (%)
As of December 31, 2020	128,390	87,311	64.5
As of March 31, 2020	116,273	80,422	65.4

Reference: Equity capital: As of December 31, 2020

2. Dividends

¥82,756 millionAs of March 31, 2020

¥76,099 million

Dividends per share
First quarter-end Yen	Second quarter-end Yen	Third quarter-end Yen	Year-end Yen	Full year Yen
Fiscal 2019	―	20.00	―	25.00	45.00
Fiscal 2020	―	20.00	―
Fiscal 2020 (forecast)	25.00	45.00

(Note) Revision of dividend projection from recently announced figures: None

3. Consolidated cumulative earnings forecast for the fiscal year ending March 31, 2021 (April 1, 2020 - March 31, 2021)

(% indicates year-on-year changes)Net SalesOperating income Ordinary income

(Note) Revision from recently projected results: Yes

%	¥ million	%	Yen
74.1	17,500	71.4	258.41
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¥ million

133,500 10.6

Profit	attributable to
attributable to	owners of
owners of parent	parent per
share

¥ million

%

10,500 64.7

Profit

* Notes

• (1) Changes in significant subsidiaries during the period (changes in specified subsidiaries due to changes in the scope of consolidation): None

  Increases: - Decreases: -

• (2) Adoption of specific accounting methods in preparing quarterly financial statements: None

• (3) Changes in accounting policies, accounting estimates and restatements

  • 1) Changes in accounting policies in conjunction with revisions to accounting standards: None

  • 2) Other changes: None

  • 3) Changes in accounting estimates: None

  • 4) Restatements: None

(4) Number of outstanding stocks (common stock)

• a. Number of outstanding stocks at the end of the fiscal year (treasury stocks included)

  As of December 31, 2020

  44,014,726

  As of March 31, 2020

  44,014,726

• b. Number of treasury stocks at the end of period

  As of December 31, 2020

  3,373,662

  As of March 31, 2020

  3,393,015

• c. Average number of shares during the period

3Q ended December 31, 2020

40,631,343

3Q ended December 31, 2019

42,605,893

* The quarterly financial results are not subject to quarterly review by a certified public accountant or an audit firm.

* Disclaimer regarding appropriate use of forecasts and related points of note

Earnings forecasts contained in these materials are based on certain assumptions judged to be reasonable and on the information available when the forecasts were made. However, the Company makes no guarantee that these forecasts will be achieved. Actual results may differ significantly from the forecasts due to a variety of factors. Please refer to "(3) Consolidated earnings forecasts and others" under "1. Qualitative information on operating results for quarter under review" on page 4 of this earnings report concerning financial forecasts such as the assumptions used for financial forecasts, factors that could cause these assumptions to change, and cautionary notes.

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1. Qualitative information on operating results for quarter under review

(1) Operating results

In the third quarter of the consolidated fiscal year under review, the Japanese economy showed signs of recovery supported by the economic measures. Nonetheless, the situation remained severe given the magnitude of the impact of the COVID-19 pandemic.

Under these circumstances, net sales for the third quarter of the fiscal year under review were ¥98,288 million, an increase of 5.8% year on year, and operating income was ¥12,745 million, an increase of 42.5% year on year. Ordinary income increased by 43.1% year on year to ¥13,217 million, and profit attributable to owners of parent increased by 48.8% year on year to ¥8,650 million.

The contract clinical testing business was faced with patients refraining from seeking medical care due to COVID-19 concerns, but since June, the situation has been gradually recovering after the lifting of the state of emergency. Still, the business environment remained challenging as competition with peer companies continued.

Conditions by business segment are described below.

In the clinical testing business, the BML Group continued its efforts in new customer acquisition and sought to enhance business performance by implementing marketing activities to further cultivate sales such as of new testing items, unique testing items, and priority testing items. With respect to testing for the novel coronavirus (SARS-CoV-2), as announced on December 15, 2020, the Group has been working on increasing its capacity and enhancing systems to respond to a surge in testing demand, to be able to conduct 20,900 tests per day in 10 laboratories nationwide. In line with these efforts, the actual quantity of contract tests increased substantially. As a result, net sales in the clinical testing business increased by 7.2% year on year.

The food hygiene business recorded decreases notably in the areas of food consulting and intestinal bacteria testing due in part to customers voluntarily restricting their operations in the face of the COVID-19 pandemic, although signs of recovery are emerging. As a result, net sales decreased by 14.1% year on year.

As a consequence of the above, net sales in the testing business overall increased 6.3% year on year.

In the medical informatics business, net sales decreased 3.7% year on year. With its sights set on launching commercial sales, the Company is preparing for an electronic cloud-based patient chart system.

In other businesses, the dispensing pharmacy business was affected by a decrease in outpatient visits due to the COVID-19 pandemic as well as revision of medical service fees (reduction in drug prices), while the SMO* business also saw declining sales. Overall, net sales decreased by 4.6% year on year.

* Site Management Organization (SMO): An independent organization that contracts with a specific medical institution to support clinical trials specific to that institution.

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