Application of the Accounting Standard for Revenue Recognition and Impact on Presentation

「As a result, for the current consolidated fiscal year, net sales decreased by ¥434,944 thousand and cost of sales decreased by ¥436,705 thousand, while gross profit, operating profit, ordinary profit and profit before income taxes increased by ¥1,761 thousand each. In addition, the opening balance of retained earnings decreased by ¥5,808 thousand.」

「The Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, 31 March 2020; hereinafter, the “Revenue Recognition Standard”) and related standards were applied from the beginning of the first quarter of the consolidated fiscal period. Revenue is recognized at the amount expected to be received in exchange for the promised goods or services when control of those goods or services is transferred to the customer. As a result, for the nine-month period ended in the third quarter of the current consolidated fiscal year, net sales decreased by ¥293,559 thousand and cost of sales decreased by ¥294,463 thousand, while gross profit, operating profit, ordinary profit and profit before income taxes increased by ¥903 thousand each. In addition, the opening balance of retained earnings decreased by ¥5,808 thousand.」