| The following information was originally prepared and published by GNI Group Ltd. in Japanese as it contains timely disclosure materials to be submitted to the Tokyo Stock Exchange. This English summary translation is for reference purposes only. To the extent there is any discrepancy between this English translation and the original Japanese version, please refer to the Japanese version. The following information was prepared in accordance with International Financial Reporting Standards (“IFRS”). |
|
| Consolidated Financial Results for FY2023 (IFRS) |
| February 14, 2024 |
| Company Name: | GNI Group Ltd. | Tokyo Stock Exchange |
| Stock Code: | 2160 | URL https://www.gnipharma.com |
| Representative: | Ying Luo, Director, Representative Executive Officer, President, and CEO | |
| Inquiries: | Toshiya Kitagawa, Executive Officer, CFO | TEL: +81-3-6214-3600 |
| Annual General Shareholder Meeting Date | March 28, 2024 |
| Annual financial report (Yuho) disclosure date: | March 29, 2024 |
| Supplementary materials prepared for financial results: | Yes |
| Financial result briefing meeting: | Yes (For institutional investors and analysts) |
| (Amounts of less than one million yen are rounded down) |
1. Consolidated Financial Results for FY2023 (January to December)
(1) Consolidated Operating Results
| (Percentages are shown as year-on-year changes) |
| | Revenue | Operating profit | Profit before tax | Profit for the year | Profit attributable to owners of the parent | Total comprehensive income for the year |
| | Million yen | % | Million yen | % | Million yen | % | Million yen | % | Million yen | % | Million yen | % |
| FY2023 | 26,010 | 49.3 | 13,108 | 851.3 | 12,612 | - | 9,504 | - | 8,094 | - | 10,662 | - |
| FY2022 | 17,418 | 37.3 | 1,377 | (15.2) | 767 | (30.6) | (868) | - | 388 | (63.5) | 187 | (88.1) |
| | | Basic earnings per share | | Diluted earnings per share | | Ratio of profit for the year to equity attributable to owners of the parent | | Ratio of profit before tax to total assets | | Ratio of operating profit to revenue | |
| | | Yen | | Yen | | % | | % | | % | |
| | FY2023 | 169.50 | | 165.56 | | 29.6 | | 26.2 | | 50.4 | |
| | FY2022 | 8.19 | | 8.11 | | 2.0 | | 2.4 | | 7.9 | |
(2) Consolidated Financial Position
| | | Total assets | Total equity | Total equity attributable to owners of the parent | Ratio of total equity attributable to owners of the parent to total assets | | Total equity attributable to owners of the parent per share | |
| | | Million yen | | Million yen | | Million yen | | % | | Yen | |
| | FY2023 | 62,394 | | 36,052 | | 33,794 | | 54.2 | | 678.01 | |
| | FY2022 | 33,906 | | 19,810 | | 20,969 | | 61.8 | | 441.59 | |
(3) Consolidated Cash Flows
| | | Cash flows from operating activities | | Cash flows from investing activities | | Cash flows from financing activities | | Cash and cash equivalents as of the end of period | |
| | | Million yen | | Million yen | | Million yen | | Million yen | |
| | FY2023 | 6,549 | | (6,842) | | 10,686 | | 21,633 | |
| | FY2022 | 393 | | (4,116) | | (646) | | 11,049 | |
2. Dividends
| | Dividends per share | Total amount of dividends | Dividend payout ratio (consolidated) | Ratio of dividend to total equity attributable to owners of the parent (consolidated) |
| | Q1-end | Q2-end | Q3-end | Year-End | Total |
| | Yen | Yen | Yen | Yen | Yen | Million yen | % | % |
| FY2022 | - | - | - | 0.00 | 0.00 | - | - | - |
| FY2023 | - | - | - | 0.00 | 0.00 | - | - | - |
| FY2024 (Forecast) | - | - | - | 0.00 | 0.00 | | - | |
3. Consolidated Earnings Forecasts for FY2024 (January to December)
| (Percentages are shown as year-on-year changes) |
| | Revenue | Operating profit | Profit before tax | Profit for the year | Profit attributable to owners of the parent | Basic earnings per share |
| | Million yen | % | Million yen | % | Million yen | % | Million yen | % | Million yen | % | Yen |
| FY2024 | 39,566 | 52.1 | 16,286 | 24.2 | 15,552 | 23.3 | 12,287 | 29.3 | 7,058 | (12.8) | 141.60 |
For details regrading the performance forecasts above, please refer to the attached document “1. Analysis of Operating Results and Financial Position (5) Outlook for the fiscal year ended December 31,2024”
Notes:
(1) Changes in Significant Subsidiaries during the Period under Review: Yes
(Changes in specified subsidiaries resulting in a change in the scope of consolidation)
New: Gyre Therapeutics, Inc., Berkeley Biologics LLC
Excluded: N.A.
(2) Changes in Accounting Policies and Changes in Accounting Estimates
① Changes in accounting policies that are required under IFRS: N.A.
② Changes in accounting policies other than ① : N.A.
③ Changes in accounting estimates: N.A.
(3) Number of Shares Issued (Common Stock)
① Number of shares issued as of the end of the period (including treasury stock) | | FY2023 | 49,857,243 shares | | | FY2022 | 47,487,843 shares | |
② Number of treasury stock as of the end of the period | | FY2023 | 13,526 shares | | | FY2022 | 1,391 shares | |
③ Average number of shares for the period | | FY2023 | 47,752,120 shares | | | FY2022 | 47,473,964 shares | |
* This consolidated financial report is not subject to audit procedures by certified public accountants or an auditing firm.
* Explanation Concerning the Proper Use of Financial Results Forecasts and Other Relevant Specific Items
Forward-looking statements including earnings forecasts contained in this report are based on currently available information and management’s assumptions and beliefs regarding uncertainties that may impact future earnings forecasts. The Company cautions readers that actual results may differ materially from forecasts due to a variety of factors. For the assumptions that underpin financial results forecasts as well as other related items, please refer to “1. (5) Outlook for the fiscal year ending December 31, 2024.”
The Group is planning to conduct a corporate presentation meeting for institutional investors and analysts on February 20, 2024. The presentation material for the meeting will be disclosed in advance, and the contents of the Q&A session, among other details, will be promptly disclosed after the meeting.
* Please note that "-" is used YoY change ratios, if either or both the current period (this quarter) and the previous period (same quarter of the previous year) is negative, or if the change ratio is above 1,000%.
Contents
| 1. | Analysis of Operating Results and Financial Position
| 2 |
| | (1) | Analysis of operating results
| 2 |
| | (2) | Analysis of financial position
| 4 |
| | (3) | Analysis of cash flows
| 4 |
| | (4) | Research and development activities
| 5 |
| | (5) | Outlook for the fiscal year ended December 31, 2024
| 6 |
| 2. | Basic Policy on the Selection of Accounting Standards
| 6 |
| 3. | Consolidated Financial Statements and Notes
| 7 |
| | (1) | Consolidated statements of financial position
| 7 |
| | (2) | Consolidated statements of income and consolidated statements of comprehensive income
| 9 |
| | (3) | Consolidated statements of changes in equity
| 11 |
| | (4) | Consolidated statements of cash flows
| 13 |
| | (5) | Notes to consolidated financial statements
| 14 |
| | | (Notes related to going concern assumptions)
| 14 |
| | | (Basis of preparation)
| 14 |
| | | (Segment information)
| 14 |
| | | (Earnings per share)
| 18 |
| | | (Important subsequent events)
| 19 |
1. Analysis of Operating Results and Financial Position
(1) Analysis of operating results
In 2023, the global economy experienced a relaxation of the stringent measures related to the COVID-19 infection, leading to a return to stability. However, geopolitical risks, such as the intensification of the situation in the Middle East, increased, creating an unpredictable environment.
The Japanese economy has also demonstrated a certain level of stabilization as the impact of the COVID-19 infection subsides, and towards the year-end, positive factors such as the Nikkei Stock Average reaching its highest level since the bubble era have been observed; however, inflation has arisen due to the yen’s depreciation, and addressing the gap with income increases is being highlighted as a significant challenge.
On the other hand, in the biotechnology sector to which our company belongs and in the TSE Growth Market, an overall challenging situation has been persisting due to growing concerns about future domestic interest rate hikes.
Despite these circumstances, GNI Group Ltd. (“the Company” or “we”) and its affiliated companies (“the Group”) have achieved significant increases in revenue and profit, recording all-time highs in revenue, operating profit, and net profit. Several projects that the Group has been actively pursuing as a foundation for future business development have also yielded important results.
In the Pharmaceutical Segment, Beijing Continent Pharmaceutical Co., Ltd. (BC), a major subsidiary of the Group, continued to see strong sales of its main product, ETUARY®, contributing significantly to the increase in revenue. In addition, as disclosed on October 26, 2023, BC has significantly accelerated the schedule for patient enrollment in the Phase III clinical trial of its promising next-generation core product, F351 (generic name: Hydronidone), in China, completing it ahead of the initially planned timeframe for 2023, and BC is actively collecting data. Furthermore, as announced on October 31, 2023, BC successfully concluded a transaction with Catalyst Biosciences, Inc. (“CBIO”), a company listed on the U.S. Nasdaq market. CBIO has subsequently changed its name to Gyre Therapeutics, Inc. (“GYRE”) and is actively preparing to file an IND (Investigational New Drug) application for the Phase II clinical trial for metabolic dysfunction-associated steatohepatitis (MASH: The disease name, Metabolic Dysfunction Associated Steatohepatitis, was formerly known as NASH [Non-Alcoholic Steatohepatitis].) in the United States in 2024. In addition, to leverage the established sales network in China, BC has commenced the development and sale of other generic orphan drugs.
Additionally, our U.S. subsidiary, Cullgen Inc. (“Cullgen”), which is advancing research and development utilizing its unique targeted protein degradation technology through its facilities in the United States and China, successfully secured $35 million in funding with AstraZeneca-CICC Fund as the lead investor, as disclosed on May 9, 2023. Furthermore, as disclosed on June 15, 2023, Cullgen entered into a partnership with Astellas Pharma Inc. (“Astellas Pharma”) for the innovative development of protein degraders and is actively advancing the research. This collaboration not only resulted in an upfront fee of $35 million but also secured a stable source of monthly revenue, leading to Cullgen achieving profitability in IFRS. Cullgen could receive up to $1.9 billion in total compensation from this collaboration. In line with the disclosure from July 31, 2023, the company is progressing with Phase I/II clinical trials for its TRK degrader, an oncology drug candidate, in China. For several other programs, Cullgen is actively progressing research and development to apply for clinical trial approval.
With regards to the Medical Device Segment, our subsidiaries’ performance remains robust, led by Berkeley Advanced Biomaterials LLC (“BAB”), which is engaged in the biomaterials business in the United States. As disclosed on September 19 and November 10, 2023, the Group acquired a portion of the orthobiologics business from Elutia Inc., a company listed on the U.S. Nasdaq market, and is actively working on the expansion of this business.
As disclosed on November 20, 2023, CVI Investments, Inc. (“CVI”) exercised all the 46th and 47th warrants, and in addition, the Company repurchased and cancelled the 48th warrants allocated to CVI. As a result, the Company has secured funds for further growth and eliminated concerns about the potential dilution of approximately 9% of the outstanding shares.
① Operating results by segment
Pharmaceutical Segment
For fiscal year 2023, our main subsidiary BC continued to achieve record-high revenue in the local currency for its main product, ETUARY®, showing robust revenue growth in China. In addition, Cullgen’s partnership with Astellas Pharma on the development of protein degraders contributed significantly, with an upfront payment of 35 million US dollars and monthly revenue from joint development expenses. For the current consolidated fiscal year in the pharmaceutical segment, revenue and segment profit were JPY 22.9 billion up 53.3% YoY, and JPY12.0 billion, up 2,687.3% YoY, respectively.
Medical Device Segment
Our Medical Devices Segment also demonstrated robust performance. As previously disclosed on September 19 and November 10, 2023, the Group acquired a portion of the orthobiologics business from Elutia Inc, a Nasdaq-listed company. Revenue and segment income amounted to JPY 3.0 billion, up 21.3% YoY, and JPY 1.0 billion, up 14.3% YoY, respectively.
② Selling, General and Administrative Expenses; Research and Development Expenses
| | | FY2022 | | FY2023 | | Difference | |
| | Selling, general and administrative expenses | (10,965,656) | | (15,292,839) | | (4,327,182) | |
| | Personnel expenses | (3,636,074) | | (5,318,748) | | (1,682,673) | |
| | Research and development expenses | (2,545,455) | | (2,557,803) | | (12,347) | |
Selling, general and administrative (SG&A) expenses in JPY terms for 2023 were JPY 15.2 billion, up 39.5% YoY. The increase in SG&A expenses comes mainly from such factors as increased sales and marketing expenses due to the expansion of the sales structure at BC, legal expenses related to CBIO transaction, and increased miscellaneous expenses at GYRE after the completion of the transaction.
Research and Development expenses in JPY terms for 2023 were JPY 2.5 billion, up 0.5% YoY, driven by the progress in research and development at BC and Cullgen in China. BC's research and development expenses include costs related to the development of new pipelines as well as the commercialization of other generic orphan drugs.
③ Finance Income and Finance Costs
| | | FY2022 | | FY2023 | | Difference | |
| | Finance income | 259,835 | | 771,527 | | 511,692 | |
| | Finance costs | (869,887) | | (1,250,685) | | (380,798) | |
Finance income
In 2023, the Group recorded finance income of JPY 771 million, up 196.9% YoY caused mainly by currency translation from depreciating Japanese yen.
Finance costs
In 2023, the Group recorded finance costs of JPY 1,250 million, up 43.8% YoY. These finance costs come from non-cash accrual of interest expenses related to financing activities at Cullgen.
(2) Analysis of financial position
| Summary of Consolidated Financial Position |
| | | As of December 31, 2022 | | As of December 31, 2023 | | Difference | |
| | Total assets | 33,906,981 | | 62,394,370 | | 28,487,388 | |
| | Total liabilities | 14,096,013 | | 26,341,592 | | 12,245,578 | |
| | Total equity | 19,810,968 | | 36,052,778 | | 16,241,809 | |
Total assets
As of 2023 end, the total assets stood at JPY 62.3 billion, a 84.0% increase compared to the previous fiscal year end. This increase primarily comes from increases in cash and cash equivalents due to increased business activities and in goodwill due to M&A activities.
Total liabilities
As of 2023 end, the total liabilities stood at JPY 26.3 billion, a 86.9% increase compared to the previous fiscal year end. This increase was due to non-cash interest expenses related to Cullgen’s funding.
Total equity
As of 2023 end, the total equity stood at JPY36.0 billion, a 82.0% increase compared to the previous fiscal year end. The increase was mainly due to the increase in retained earnings coming from the increases in revenue, capital stock and capital surplus resulting from the exercise of warrants.
(3) Analysis of cash flows
| Summary of Consolidated Cash Flows |
| | | FY2022 | | FY2023 | | Difference | |
| | Cash flows from operating activities | 393,320 | | 6,549,337 | | 6,156,016 | |
| | Cash flows from investing activities | (4,116,163) | | (6,842,661) | | (2,726,498) | |
| | Cash flows from financing activities | (646,327) | | 10,686,556 | | 11,332,883 | |
Cash flows from operating activities
The cash flow from operating activities came to JPY 6.5 billion in 2023, a 1,565.1% increase YoY. The main drivers are BC’s robust sales growth and Cullgen’s collaboration contract with Astellas Pharma.
Cash flows from investing activities
The cash flow from investing activities came to negative JPY 6.8 billion in 2023, a 66.2% YoY increase. The major sources of the increase are investments related to acquisitions and a purchase of long-term deposits.
Cash flows from financing activities
The cash flow from financing activities came to positive JPY 10.6 billion in 2023 vs negative JPY 0.6 billion in 2022. This is mainly due to an increase in income from the issuance of new shares through the exercise of warrants and from Cullgen’s Series C preferred share issuance.
(4) Research and development activities
[Research Activities]
The Group’s drug discovery research aims to develop innovative new development candidate compounds (NCE), mainly in Cullgen. Cullgen is pursuing R&D to expand its drug discovery pipeline, which includes several new compounds targeting enzymes and non-enzymes for oncology, pain and autoimmune diseases.
As disclosed on June 15, 2023, Cullgen entered into a joint research and exclusive option contract with Astellas Pharma for the creation of innovative protein degraders. In this strategic alliance, the two companies will combine Cullgen’s proprietary technological platform uSMITE™ featuring novel E3 Ligands with the drug discovery and commercialization capabilities of Astellas Pharma, with the aim of creating several targeted protein degraders. Cullgen and Astellas Pharma will conduct joint research to identify clinical development candidates, and Astellas Pharma will be responsible for development and commercialization of the resulting degraders. Cullgen is making steady progress in the joint research with Astellas Pharma, including the lead program, a protein degrader for a cell-cycle protein identified by Astellas Pharma for the treatment of breast cancer and other solid cancers.
[Development Activities]
■ ETUARY® [Chinese: 艾思瑞® , (Generic name: Pirfenidone)] by BC
BC is conducting clinical trials to expand the indications of ETUARY® to the following diseases, but currently we are prioritizing the clinical development of F351.
● Diabetic Kidney Disease (DKD): Phase I completed, discussing further steps with Chinese authorities.
● Connective Tissue Diseases Associated Interstitial Lung Disease (CTD-ILD: SSc-ILD and DM-ILD): Phase III clinical trial ongoing.
● Pneumoconiosis (PD): Phase III clinical trial ongoing.
■F351 (Generic Name: Hydronidone) by BC and GYRE
F351 is a crucial drug candidate for the treatment of liver fibrosis in our pharmaceutical portfolio, playing a significant role in our strategy to expand clinical development activities into major global pharmaceutical markets. F351, a derivative of ETUARY®, is a novel compound that inhibits the proliferation of hepatic stellate cells, which play a vital role in organ fibrosis, and blocks the TGF-β signaling pathway.
As disclosed on March 17, 2021, F351 has been recognized by Chinese authorities as a breakthrough therapeutic drug for liver fibrosis. This allows for prioritized discussions with regulatory authorities and the advancement of clinical trials based on the results of these discussions.
As announced on January 17, 2022, BC initiated Phase III clinical trials for F351 in China. Furthermore, as disclosed on October 26, 2023, BC significantly accelerated the schedule for patient enrollment in the Phase III clinical trial, completing the enrollment ahead of the initial plan of 2023 end. Currently, BC is diligently collecting data.
In the United States, GYRE is actively preparing to file an IND (Investigational New Drug) application to U.S. regulatory authorities for the Phase II clinical trial for Metabolic Dysfunction Associated Steatohepatitis (MASH) in 2024. As of now, there are no approved products for the treatment of MASH in Japan, the United States, or Europe.
■ F573 (for Acute liver failure [ALF] and Acute on chronic liver failure [ACLF]) by BC
F573, as the third drug candidate following ETUARY® and F351, is a di-peptide compound with the potential to strongly inhibit caspases. It is expected to be effective against apoptosis and inflammatory reactions associated with Acute Liver Failure (ALF) and Acute-on-Chronic Liver Failure (ACLF). As disclosed on March 28, 2023, F573 is in the Phase II clinical trial.
■CG001419 (TRK degrader) by Cullgen
CG001419 is an oral agent utilizing the industry’s first selective and potent targeted protein degrader for cancers with neurotrophic tyrosine receptor kinase (NTRK) fusion genes or TRK overexpression (commonly seen in many solid cancers including non-small cell lung cancer, breast cancer, and pancreatic cancer). As disclosed on July 31, 2023, Cullgen initiated its first clinical trial (Phase I/II) for the TRK degrader in China.
■Other generic orphan drugs - BC
BC licensed in the rights to Avatrombopag Maleate tablets and Fingolimod Hydrochloride capsules for the treatment of thrombocytopenia caused by chronic liver diseases and multiple sclerosis, respectively, and is preparing for their commercialization as other generic orphan drugs in China.
(5) Outlook for the fiscal year ended December 31, 2024
In the fiscal year 2024, we anticipate a steady performance in both revenue and profit for the Group’s core business, the Pharmaceutical Segment, following the trend observed in 2023. BC continues to expand the sales of ETUARY® in China and is expected it to continue leading the Group. Additionally, we anticipate smooth progress in research and development at Cullgen.
In the Medical Device Segment, we expect the orthobiologics business acquired in the United States, in conjunction with the existing business at BAB, to contribute even more significantly to the business performance of the Group.
2. Basic Policy on the Selection of Accounting Standards
GNI Group applies International Financial Reporting Standards [IFRS].
3. Consolidated Financial Statements and Notes
(1) Consolidated statements of financial position
| | | FY2022 (As of Dec 31, 2022) | | | FY2023 (As of Dec 31, 2023) | |
| Assets | | | | | | |
| Non-current assets | | | | | | |
| Property, plant and equipment | | | 3,951,217 | | | | 5,238,673 | |
| Right-of-use assets | | | 755,167 | | | | 814,513 | |
| Goodwill | | | 6,047,721 | | | | 17,261,275 | |
| Intangible assets | | | 2,928,800 | | | | 3,690,331 | |
| Investments accounted for using the equity method | | | 622,476 | | | | 360,821 | |
| Deferred income tax assets | | | 184,171 | | | | 304,436 | |
| Other financial assets | | | 2,270,162 | | | | 3,793,224 | |
| Other non-current assets | | － | | | | 23,811 | |
| Total non-current assets | | | 16,759,717 | | | | 31,487,087 | |
| | | | | | | | | |
| Current assets | | | | | | | | |
| Inventories | | | 1,693,412 | | | | 2,330,622 | |
| Trade and other receivables | | | 3,122,463 | | | | 3,973,476 | |
| Other financial assets | | | 196,543 | | | | 1,577,274 | |
| Other current assets | | | 1,085,535 | | | | 1,392,881 | |
| Cash and cash equivalents | | | 11,049,310 | | | | 21,633,028 | |
| Total current assets | | | 17,147,264 | | | | 30,907,282 | |
| Total assets | | | 33,906,981 | | | | 62,394,370 | |
| | | | | | | | | |
| Liabilities and equity | | | | | | | | |
| Non-current liabilities | | | | | | | | |
| Loans Payable | | － | | | | 2,000,000 | |
| Lease liabilities | | | 157,744 | | | | 150,276 | |
| Deferred income tax liabilities | | | 546,790 | | | | 1,173,159 | |
| Other financial liabilities | | | 9,706,958 | | | | 15,139,232 | |
| Other non-current liabilities | | | 181,027 | | | | 85,146 | |
| Total non-current liabilities | | | 10,592,520 | | | | 18,547,815 | |
| | | | | | | | | |
| Current liabilities | | | | | | | | |
| Trade and other payables | | | 949,612 | | | | 2,064,776 | |
| Borrowings | | | 200,000 | | | | 1,300,000 | |
| Lease liabilities | | | 179,611 | | | | 249,158 | |
| Current tax payable | | | 1,179,254 | | | | 2,187,700 | |
| Other financial liabilities | | | 7,225 | | | | 49,010 | |
| Other current liabilities | | | 987,788 | | | | 1,943,131 | |
| Total current liabilities | | | 3,503,492 | | | | 7,793,776 | |
| Total liabilities | | | 14,096,013 | | | | 26,341,592 | |
| Equity | | | | | | |
| Capital stock | | | 10,893,070 | | | | 13,052,056 | |
| Capital surplus | | | 6,233,386 | | | | 7,397,974 | |
| Treasury stock | | | (756 | ) | | | (15,302 | ) |
| Retained earnings (loss) | | | 696,360 | | | | 8,790,563 | |
| Other components of equity | | | 3,147,631 | | | | 4,569,122 | |
| Total equity attributable to owners of the parent | | | 20,969,692 | | | | 33,794,414 | |
| Not-controlling interests | | | (1,158,724 | ) | | | 2,258,363 | |
| Total equity | | | 19,810,968 | | | | 36,052,778 | |
| Total equity and liabilities | | | 33,906,981 | | | | 62,394,370 | |
(2) Consolidated statements of income and consolidated statements of comprehensive income
Consolidated statements of income
| | | FY2022 (Jan 1, 2022 to Dec 31, 2022) | | | FY2023 (Jan 1, 2023 to Dec 31, 2023) | |
| Revenue | | | 17,418,966 | | | | 26,010,571 | |
| Cost of sales | | | (2,674,409 | ) | | | (3,579,396 | ) |
| Gross profit | | | 14,744,556 | | | | 22,431,175 | |
| | | | | | | | | |
| Selling, general and administrative expenses | | | (10,965,656 | ) | | | (15,292,839 | ) |
| Research and development expenses | | | (2,545,455 | ) | | | (2,557,803 | ) |
| Other income | | | 664,743 | | | | 9,147,345 | |
| Other expenses | | | (520,248 | ) | | | (619,035 | ) |
| Operating profit | | | 1,377,939 | | | | 13,108,843 | |
| | | | | | | | | |
| Finance income | | | 259,835 | | | | 771,527 | |
| Finance costs | | | (869,887 | ) | | | (1,250,685 | ) |
| Equity Losses of Affiliated Companies | | － | | | | (16,936 | ) |
| Profit before tax | | | 767,887 | | | | 12,612,748 | |
| Income tax expense | | | (1,636,139 | ) | | | (3,108,669 | ) |
| Profit (loss) for the year | | | (868,252 | ) | | | 9,504,078 | |
| | | | | | | | | |
| Profit (loss) attributable to: | | | | | | | | |
| Owners of the parent | | | 388,825 | | | | 8,094,202 | |
| Non-controlling interests | | | (1,257,078 | ) | | | 1,409,875 | |
| | | | | | | | | |
| Earnings per share | | | | | | | | |
| Basic earnings per share (Yen) | | | 8.19 | | | | 169.50 | |
| Diluted earnings per share (Yen) | | | 8.11 | | | | 165.56 | |
Consolidated statements of comprehensive income
| | | FY2022 (Jan 1, 2022 to Dec 31, 2022) | | | FY2023 (Jan 1, 2023 to Dec 31, 2023) | |
| Profit (loss) for the year | | | (868,252 | ) | | | 9,504,078 | |
| | | | | | | | | |
| Other comprehensive income | | | | | | | | |
| Items that may be reclassified to profit or loss, net of tax | | | | | | | | |
| Exchange differences on translation of foreign operations | | | 1,055,949 | | | | 1,150,717 | |
| Share in Other Comprehensive Income for Equity Method Investees | | | - | | | | 7,824 | |
| Total other comprehensive income (loss) | | | 1,055,949 | | | | 1,158,541 | |
| Total comprehensive income for the year | | | 187,696 | | | | 10,662,620 | |
| | | | | | | | | |
| Total comprehensive income (loss) for the year attributable to: | | | | | | | | |
| Owners of the parent | | | 1,811,272 | | | | 8,916,299 | |
| Non-controlling interests | | | (1,623,576 | ) | | | 1,746,321 | |
| (3) | Consolidated statement of changes in equity |
Thousand yen
| | | Attributable to owners of the parent | |
| | | Capital stock | | | Capital surplus | | | Treasury stock | | | Retained profit(loss) | | | Other components of equity | |
| | | Subscription rights to shares | | | Exch. diff on translation of foreign operations | | | Total | |
| Balance at Jan 1, 2022 | | | 10,884,332 | | | | 6,224,649 | | | | (645 | ) | | | 307,535 | | | | 543,445 | | | | 900,992 | | | | 1,444,437 | |
| Profit (loss) for the year | | | - | | | | - | | | | - | | | | 388,825 | | | | - | | | | - | | | | - | |
| Other comprehensive income | | | - | | | | - | | | | - | | | | - | | | | - | | | | 1,422,447 | | | | 1,422,447 | |
| Total comprehensive income | | | - | | | | - | | | | - | | | | 388,825 | | | | - | | | | 1,422,447 | | | | 1,422,447 | |
| Change in scope of consolidation | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
| Issuance of new shares | | | 8,737 | | | | 8,737 | | | | - | | | | - | | | | - | | | | - | | | | - | |
| Stock-based compensation transactions | | | - | | | | - | | | | - | | | | - | | | | 276,230 | | | | - | | | | 276,230 | |
| Issuance of new subscription rights to shares | | | - | | | | - | | | | - | | | | - | | | | 6,409 | | | | - | | | | 6,409 | |
| Issuance cost of subscription rights to shares | | | - | | | | - | | | | - | | | | - | | | | (1,892 | ) | | | - | | | | (1,892 | ) |
| Purchase of treasury stock | | | - | | | | - | | | | (111 | ) | | | - | | | | - | | | | - | | | | - | |
| Total amount of transactions with owners | | | 8,737 | | | | 8,737 | | | | (111 | ) | | | - | | | | 280,746 | | | | - | | | | 280,746 | |
| Balance at Dec 31, 2022 | | | 10,893,070 | | | | 6,233,386 | | | | (756 | ) | | | 696,360 | | | | 824,192 | | | | 2,323,439 | | | | 3,147,631 | |
| | | attributable to owners of the parent | | | Non-controlling interests | | | Total equity | |
| | | Total | | |
| | |
| |
| Balance as of Jan 1 2022 | | | 18,860,309 | | | | 405,936 | | | | 19,266,246 | |
| Profit (loss) for the year | | | 388,825 | | | | (1,257,078 | ) | | | (868,252 | ) |
| Other comprehensive income (loss) | | | 1,422,447 | | | | (366,497 | ) | | | 1,055,949 | |
| Total comprehensive income (loss) | | | 1,811,272 | | | | (1,623,576 | ) | | | 187,696 | |
| Change in scope of consolidation | | | - | | | | 58,915 | | | | 58,915 | |
| Issuance of new shares | | | 17,475 | | | | - | | | | 17,475 | |
| Stock compensation transactions | | | 276,230 | | | | - | | | | 276,230 | |
| Issuance of new subscription rights to shares | | | 6,409 | | | | - | | | | 6,409 | |
| Issuance cost of subscription rights to shares | | | (1,892 | ) | | | - | | | | (1,892 | ) |
| Acquisition of treasury stock | | | (111 | ) | | | - | | | | (111 | ) |
| Total amount of transactions with owners | | | 298,110 | | | | 58,915 | | | | 357,025 | |
| Balance as of Dec 31 2022 | | | 20,969,692 | | | | (1,158,724 | ) | | | 19,810,968 | |
| | | Attributable to owners of the parent | |
| | | Capital stock | | | Capital surplus | | | Treasury stock | | | Retained profit(loss) | | | Other components of equity | |
| | | Subscription rights to shares | | | Exch. diff on translation of foreign operations | | | Total | |
| Balance at Jan 1, 2023 | | | 10,893,070 | | | | 6,233,386 | | | | (756 | ) | | | 696,360 | | | | 824,192 | | | | 2,323,439 | | | | 3,147,631 | |
| Profit (loss) for the year | | | - | | | | - | | | | - | | | | 8,094,202 | | | | - | | | | - | | | | - | |
| Other comprehensive income | | | - | | | | - | | | | - | | | | - | | | | - | | | | 822,096 | | | | 822,096 | |
| Total comprehensive income | | | - | | | | - | | | | - | | | | 8,094,202 | | | | - | | | | 822,096 | | | | 822,096 | |
| Change in scope of consolidation | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - | |
| Equity Changes in Subsidiaries with Continuing Control | | | - | | | | (999,553 | ) | | | - | | | | - | | | | - | | | | (80,129 | ) | | | (80,129 | ) |
| Issuance of new shares | | | 2,166,261 | | | | 2,166,261 | | | | - | | | | - | | | | - | | | | - | | | | - | |
| Stock Issuance Costs | | | (7,275 | ) | | | (7,275 | ) | | | - | | | | - | | | | - | | | | - | | | | - | |
| Stock-based compensation transactions | | | - | | | | - | | | | - | | | | - | | | | 755,072 | | | | - | | | | 755,072 | |
| Issuance of new subscription rights to shares | | | - | | | | - | | | | - | | | | - | | | | 5,568 | | | | - | | | | 5,568 | |
| Issuance cost of subscription rights to shares | | | - | | | | - | | | | - | | | | - | | | | (7,124 | ) | | | - | | | | (7,124 | ) |
| Exercise of subscription rights to shares | | | - | | | | - | | | | - | | | | - | | | | (16,394 | ) | | | - | | | | (16,394 | ) |
| Cancellation of subscription rights to shares | | | | | | | | | | | | | | | | | | | (35,872 | ) | | | | | | | (35,872 | ) |
| Expiration of subscription rights to shares | | | - | | | | - | | | | - | | | | - | | | | (21,725 | ) | | | - | | | | (21,725 | ) |
| Acquisition of treasury stock | | | - | | | | - | | | | (14,546 | ) | | | - | | | | - | | | | - | | | | - | |
| Others | | | - | | | | 5,155 | | | | - | | | | - | | | | - | | | | - | | | | - | |
| Total amount of transactions with owners | | | 2,158,985 | | | | 1,164,587 | | | | (14,546 | ) | | | - | | | | 679,524 | | | | (80,129 | ) | | | 599,394 | |
| Balance at Dec 31, 2023 | | | 13,052,056 | | | | 7,397,974 | | | | (15,302 | ) | | | 8,790,563 | | | | 1,503,717 | | | | 3,065,405 | | | | 4,569,122 | |
| | | attributable to owners of the parent | | |
| | |
| |
| | | Total | | | Non-controlling interests | | | Total equity | |
| Balance as of Jan 1 2023 | | | 20,969,692 | | | | (1,158,724 | ) | | | 19,810,968 | |
| Profit (loss) for the year | | | 8,094,202 | | | | 1,409,875 | | | | 9,504,078 | |
| Other comprehensive income (loss) | | | 822,096 | | | | 336,445 | | | | 1,158,541 | |
| Total comprehensive income (loss) | | | 8,916,299 | | | | 1,746,321 | | | | 10,662,620 | |
| Change in scope of consolidation | | | - | | | | 591,083 | | | | 591,083 | |
| Equity Changes in Subsidiaries with Continuing Control | | | (1,079,683 | ) | | | 1,079,683 | | | | - | |
| Issuance of new shares | | | 4,332,523 | | | | - | | | | 4,332,523 | |
| Stock Issuance Costs | | | (14,551 | ) | | | - | | | | (14,551 | ) |
| Stock compensation transactions | | | 755,072 | | | | - | | | | 755,072 | |
| Issuance of new subscription rights to shares | | | 5,568 | | | | - | | | | 5,568 | |
| Issuance cost of subscription rights to shares | | | (7,124 | ) | | | - | | | | (7,124 | ) |
| Exercise of subscription rights to shares | | | (16,394 | ) | | | - | | | | (16,394 | ) |
| Cancellation of subscription rights to shares | | | (35,872 | ) | | | | | | | (35,872 | ) |
| Expiration of subscription rights to shares | | | (21,725 | ) | | | - | | | | (21,725 | ) |
| Purchase of treasury stock | | | (14,546 | ) | | | - | | | | (14,546 | ) |
| Others | | | 5,155 | | | | - | | | | 5,155 | |
| Total amount of transactions with owners | | | 3,908,421 | | | | 1,670,767 | | | | 5,579,189 | |
| Balance as of Dec 31 2023 | | | 33,794,414 | | | | 2,258,363 | | | | 36,052,778 | |
| (4) | Consolidated statements of cash flows |
| | | FY2022 (Jan 1, 2022 to Dec 31, 2022) | | | FY2023 (Jan 1, 2023 to Dec 31, 2023) | |
| Cash flows from operating activities | | | | | | |
| Profit before tax | | | 767,887 | | | | 12,612,748 | |
| Depreciation and amortization | | | 521,666 | | | | 608,422 | |
| Decrease (increase) in accounts receivables | | | (1,092,192 | ) | | | 324,379 | |
| Increase (decrease) in accounts payables | | | 559,902 | | | | 6,280 | |
| Decrease (increase) in inventories | | | (205,446 | ) | | | 145,761 | |
| Increase (decrease) in bonus allowance | | | 26,260 | | | | 16,212 | |
| Finance income and finance costs | | | 747,638 | | | | 877,467 | |
| Securities Gains and Losses | | | 349,276 | | | | 291,808 | |
| Valuation gains from conversion of affiliated company stocks to subsidiary stocks | | | | | | | (8,969,727 | ) |
| Stock-based compensation expense | | | 306,834 | | | | 1,161,004 | |
| Other, net | | | (516,455 | ) | | | 591,026 | |
| Subtotal | | | 1,465,371 | | | | 7,665,385 | |
| Interest received | | | 71,150 | | | | 494,185 | |
| Interest paid | | | (27,760 | ) | | | (30,795 | ) |
| Income tax paid | | | (1,115,440 | ) | | | (1,579,438 | ) |
| Net cash provided by (used in) operating activities | | | 393,320 | | | | 6,549,337 | |
| | | | | | | | | |
| Cash flows from investing activities | | | | | | | | |
| Increase (decrease) in time deposit | | | (1,164,533 | ) | | | (3,491,108 | ) |
| Purchases of property, plant and equipment | | | (973,523 | ) | | | (1,273,154 | ) |
| Proceeds from sales of property, plant and equipment | | | - | | | | 15,208 | |
| Purchases of other intangible assets | | | (966,453 | ) | | | (802,823 | ) |
| Increase in lease and guarantee deposits | | | (266 | ) | | | (3,831 | ) |
| Decrease in lease and guarantee deposits | | | 450 | | | | 1,203 | |
| Expenditure on Loans | | － | | | | (59,460 | ) |
| Proceeds from loans receivable | | | 4,743 | | | | 4,743 | |
| Purchase of investment securities | | | (589,252 | ) | | | - | |
| Investment to affiliated companies | | | (181,254 | ) | | | (140,670 | ) |
| Acquisition of subsidiaries with a change in scope of consolidation | | | (246,073 | ) | | | - | |
| Income from acquiring subsidiary shares with consolidation scope changes | | － | | | | 954,505 | |
| Expenditure on Business Acquisitions | | | - | | | | (2,047,274 | ) |
| Net cash provided by (used in) investing activities | | | (4,116,163 | ) | | | (6,842,661 | ) |
| | | | | | | | | |
| Cash flows from financing activities | | | | | | | | |
| Increase (decrease) in short-term loans payable | | | (500,000 | ) | | | 1,100,000 | |
| Income from long-term borrowing | | | - | | | | 2,000,000- | |
| Proceeds from the issuance of shares attributable to the exercise of subscription rights to shares | | | - | | | | 4,287,054 | |
| Proceeds from the issuance of subscription rights to shares | | | 6,409 | | | | 798 | |
| Proceeds from financing by non-controlling interests | | | - | | | | 3,516,749 | |
| Purchase of treasury stock | | | (111 | ) | | | (38 | ) |
| Repayment of lease liabilities | | | (152,624 | ) | | | (218,008 | ) |
| Net cash provided by (used in) financing activities | | | (646,327 | ) | | | 10,686,556 | |
| | | | | | | | | |
| Impact of exchange rate fluctuations | | | 1,066,346 | | | | 190,485 | |
| Increase (decrease) in cash and cash equivalents | | | (3,302,823 | ) | | | 10,583,717 | |
| Cash and cash equivalents as of the beginning of the period | | | 14,352,133 | | | | 11,049,310 | |
| Cash and cash equivalents as of the end of the period | | | 11,049,310 | | | | 21,633,028 | |
| (5) | Notes to the consolidated financial statements |
(Notes related to going concern assumptions)
Not applicable.
(Basis of preparation)
| | (1) | Matters relating to IFRS |
The Group’s consolidated financial statements are prepared in accordance with International Financial Reporting Standards (IFRS) published by the International Accounting Standards Board.
Meeting the criteria of a “specified company” as defined under Article 1-2 of the Ordinance on Terminology, Forms and Preparation Methods of Consolidated Financial Statements (Ministry of Finance Ordinance No. 28, 1976), GNI Group’s consolidated financial statements are prepared in accordance with Article 93 of the same.
| | (2) | Functional currency and presentation currency |
The Group’s consolidated financial statements are presented in Japanese yen, the Company’s functional currency. Figures of less than one thousand yen are rounded down.
| | (3) | New standards not yet adopted |
Of the newly established and revised standards and interpretations of accounting principles published by the date of approval for these consolidated financial statements, there are no standards and interpretations of accounting principles not adopted by GNI Group, which has material effect impact.
(Segment information)
The Group’s reportable segments, from which separate financial data can be obtained, are subject to periodic review by the Board of Directors for the purpose of deciding the allocation of resources and assessing performance.
The Group has two business segments: Pharmaceutical Segment consisting of drug development, manufacturing, and sales activities as well as contracted research operations and the Medical Device Segment consisting of development, manufacturing and sales activities of medical devices including biomaterials.
The major products in each reportable segment are as follows.
| | Reportable segment | | Company name | | Main product |
| | Pharmaceutical | | GNI Group Ltd.; Beijing Continent Pharmaceutical Co., Ltd; Shanghai Genomics, Inc.; GNI Hong Kong Limited; Shanghai Genomics Technology, Ltd.; Cullgen (Shanghai), Inc.; GNI USA, Inc.; Cullgen Inc.; Shanghai Rui Fu International Trade Co., Ltd.; Gyre Therapeutics, Inc. | | ETUARY®, drug discovery and development, reagents etc. |
| | Medical Device | | Berkeley Advanced Biomaterials LLC, Micren Healthcare Co., Ltd., Berkeley Biologics LLC | | Orthobiologics material, Designated Marketing Authorization Holder (DMAH) and in-country caretaker service |
| (2) | Reportable segment revenue and profit |
Information about the Company’s reportable segments is as follows.
FY2022 (Jan 1, 2022 to Dec 31, 2022)
| | Reportable segment | Adjustments | Consolidated |
| | Pharmaceutical | Medical Device | Total |
| Revenue | | | | | |
| (1) Revenue to outside customers | 14,991,354 | 2,427,611 | 17,418,966 | - | 17,418,966 |
| (2) Intra-segment revenue and transfers | - | 93,750 | 93,750 | (93,750) | - |
| Total | 14,991,354 | 2,521,361 | 17,512,716 | (93,750) | 17,418,966 |
| Segment profit | 431,488 | 946,450 | 1,377,939 | - | 1,377,939 |
| | | | | Finance income | 259,835 |
| | | | | Finance costs | (869,887) |
| | | | | Profit before tax | 767,887 |
| Note:1. | The intra-segment revenue and transfers are based on arm's length pricing. |
2.
| Adjustments of revenue are in intra-segment revenue and transfers. |
| | 3. | The segment profit reflects the operating profit in the summary of consolidated statements of income with adjustments. |
Thousand yen
| | Reportable segment | Adjustments | Consolidated |
| Pharmaceutical | Medical Device | Total |
| Depreciation and amortization | 406,008 | 115,658 | 521,666 | - | 521,666 |
FY2023 (Jan 1, 2023 to Dec 31, 2023)
| | Reportable segment | Adjustments | Consolidated |
| | Pharmaceutical | Medical Device | Total |
| Revenue | | | | | |
| (1) Revenue to outside customers | 22,976,201 | 3,034,369 | 26,010,571 | - | 26,010,571 |
| (2) Intra-segment revenue and transfers | - | 24,171 | 24,171 | (24,171) | - |
| Total | 22,976,201 | 3,058,541 | 26,034,742 | (24,171) | 26,010,571 |
| Segment profit | 12,026,795 | 1,082,048 | 13,108,843 | - | 13,108,843 |
| | | | | Finance income | 771,527 |
| | | | | Finance costs | (1,250,685) |
| | | | Equity Losses of Affiliated Companies | △16,936 |
| | | | | Profit before tax | 12,612,748 |
| Note:1. | The intra-segment revenue and transfers are based on arm's length pricing. |
| | 2. | Adjustments of revenue are in intra-segment revenue and transfers. |
| | 3. | The segment profit reflects the operating profit in the summary of consolidated statements of income with adjustments. |
Thousand yen
| | Reportable segment | Adjustments | Consolidated |
| Pharmaceutical | Medical Device | Total |
| Depreciation and amortization | 440,438 | 167,983 | 608,422 | - | 608,422 |
| | (3) | Information related to products and services |
Sales of products and services to outside customers are as follows.
| | | FY2022 (Jan 1, 2022 to Dec 31, 2022) | FY2023 (Jan 1, 2023 to Dec 31, 2023) |
| | ETUARY® | 12,939,076 | 15,686,480 |
| | Biomaterial (bone grafts substitutes) | 2,521,361 | 2,840,558 |
| | Other | 1,958,527 | 7,483,532 |
| | Total | 17,418,966 | 26,010,571 |
| (4) | Geographic information |
FY2022 (Jan 1, 2022 to Dec 31, 2022)
| | | Japan | China | U.S. | Consolidated |
| | Sales to outside customers (see note 1) | 20,957 | 14,870,594 | 2,527,413 | 17,418,966 |
| | Non-current assets (see note 2) | 344,754 | 5,193,027 | 8,145,124 | 13,682,906 |
| Notes: 1. | Measured based on customer location. |
| 2. | Other financial assets, Deferred income tax assets and Investments accounted for using the equity method are not included. |
FY2023 (Jan 1, 2023 to Dec 31, 2023)
| | | Japan | China | U.S. | Consolidated |
| | Sales to outside customers (see note 1) | 6,021,269 | 17,123,029 | 2,866,272 | 26,010,571 |
| | Non-current assets (see note 2) | 306,483 | 7,048,392 | 19,673,729 | 27,028,605 |
| Notes: | 1. Measured based on customer location. |
2.
| Other financial assets, Deferred income tax assets and Investments accounted for using the equity method are not included. |
| | (5) | Information related to major customers |
FY2022 (Jan 1, 2022 to Dec 31, 2022)
| | Customer name | Sales | | Related segment |
| | Sinopharm | 4,596,597 | | Pharmaceutical |
| | China Resources Pharmaceutical | 880,834 | | Pharmaceutical |
| | Stryker Spine | 633,006 | | Medical Device |
| | Shanghai Pharma Kyuan | 431,463 | | Pharmaceutical |
| | OsteoRemedies | 396,691 | | Medical Device |
Notes: For FY2022, the customers are shown on a group company basis. Stryker Spine includes K2M, Inc. Sinopharm includes such firms as Sinopharm Holdings Co., Ltd, Sinopharm Holding Henan Co., Ltd, Sinopharm holdings Shandong Co., Ltd, and Sinopharm Holdings Shanxi Co., Ltd.
FY2023 (Jan 1, 2023 to Dec 31, 2023)
| | Customer name | Sales | | Related segment |
| | Astellas Pharma Inc. | 5,804,973 | | Pharmaceutical |
| | Sinopharm Holding Henan Co., Ltd. | 2,147,804 | | Pharmaceutical |
| | Sinopharm Medicine Holding Shaanxi Co., Ltd. | 929,325 | | Pharmaceutical |
| | China Resources Henan Pharmaceutical Co. | 701,263 | | Pharmaceutical |
| | Sinopharm Group Shandong Co., Ltd. | 676,590 | | Pharmaceutical |
(Earnings per share)
Basic earnings per share and Diluted earnings per share and the basis for its calculation are as follows.
| (1) | Basic earnings per share |
| | | FY2022 (Jan 1, 2022 to Dec 31, 2022) | | FY2023 (Jan 1, 2023 to Dec 31, 2023) |
| | Profit attributable to owners of the parent (thousand yen) | 388,825 | | 8,094,202 |
| | Average number of ordinary shares outstanding during the fiscal year (shares) | 47,473,964 | | 47,752,120 |
| | Basic earnings per share (yen) | 8.19 | | 169.50 |
| (2) | Diluted earnings per share |
| | | FY2022 (Jan 1, 2022 to Dec 31, 2022) | | FY2023 (Jan 1, 2023 to Dec 31, 2023) |
| | Profit attributable to owners of the parent (thousand yen) | 388,825 | | 8,094,202 |
| | Average number of ordinary shares outstanding during the fiscal year (shares) | 47,473,964 | | 47,752,120 |
| | Adjustment of dilution effect: | | | |
| | Stock option (shares) | 457,152 | | 1,138,640 |
| | Diluted average number of ordinary shares outstanding (shares) | 47,931,116 | | 48,890,760 |
| | Diluted earnings per share (yen) | 8.11 | | 165.56 |
(Important subsequent events)
(Acquisition of shares in our consolidated subsidiary, Cullgen, from CVI)
(1)
| Overview of the Transactions |
The Group utilized the funds raised from CVI’s exercise of the 46th and 47th warrants, completed on November 20, 2023, to acquire all the Cullgen shares held by CVI. The acquisition was finalized on January 11, 2024.
(2)
| Total Number of Acquired Shares and Ownership Ratios Before and After Acquisition |
Acquisition Date: January 11, 2024
Total Number of Acquired Shares: 4,819,278 shares
Ownership Ratio Before Acquisition: 33.18%
Ownership Ratio After Acquisition: 40.28%
The specific acquisition cost is undisclosed due to confidentiality obligations with CVI.
(Collection of the loan from GNI USA, Inc. by GYRE shares)
(1)
| Overview of the Transaction |
The Group invested in BAB and Cullgen through our consolidated subsidiary GNI USA, Inc. (“GNI USA”), providing loans of $7 million (of which $3.9 million was outstanding as of 2023 end) in 2015 and $35 million in 2017 to GNI USA. The Company completed the collection of the loan by receiving a portion of the GYRE shares which GNI USA owns on February 2, 2024.
(2)
| Total Number of Acquired Shares and Ownership Ratios Before and After Acquisition |
1.
| Acquisition Date: February 2, 2024 |
2.
| Total Number of Acquired Shares: 3,958,739 shares (at $12.37 per share, closing price on January 31, 2024) |
| (3) | Impacts to the financial results |
For the fiscal year ending December 2023, the long-term loan to GNI USA is considered a net investment, so the impact of exchange rate fluctuations was recorded in equity for consolidation. The collection of this long-term loan is expected to have an impact of approximately 1.7 billion yen on consolidated profits for the fiscal year ending December 2024.
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