Consolidated Financial Results [Japanese GAAP]
for the Second Quarter of the Fiscal Year Ending December 31, 2022
August 9th, 2022

FINDEX Inc
Stock code:
3469
Stock Exchange Listing:
URL:
http://findex.co.jp/en/index.html
Telephone:
Representative: Teruo Aibara, President & CEO
For inquiries:
Atsushi Fujita, Director and Head of Administration
Scheduled date to submit statutory quarterly financial report:
Scheduled date of starting payment of dividend:
Availability of supplementary explanatory material on quarterly results:
Quarterly results briefing:Tokyo+81-89-947-3388

August 9, 2022
September 9,2022
N/A
Yes for analyst

1. Consolidated Financial Results for the Six Months Ended June 30, 2022 (From January 1, 2022, to June30, 2022)*Figures are rounded down to the nearest million yen, except share and per share data*“ %” indicates year-on-year changes from the previous corresponding period(1) Consolidated Operating Results（Cumulative）
Net income
attributableto owners
Revenue
Operating income
Ordinary incomeof the parent
company(JPY MM)%(JPY MM)%(JPY MM)%(JPY MM)%FY2022 2Q
2,233 (7.1)
455 (6.8)
481 (4.7)
319 (6.1)
FY2021 2Q
2,405
6.4
488 (11.6)
505 (9.0)340 (9.3)(Note) Comprehensive income: FY2022 2Q: 321 million yen [(5.4%)], FY2021 2Q: 339 million yen [(9.5%)]
Basic earnings
per share

Diluted earnings
per share

(JPY)
(JPY)
FY2022 2Q
12.49
FY2021 2Q
13.30(Note) No statement is indicated above for the number of diluted EPS because there were not any financial
instruments which has dilutive effect on common stocks outstanding.
(2) Consolidated Financial Position
Total assets
Net assets
Net assets ratio
As of the end of（JPY MM）（JPY MM）％
FY2022 2Q
4,628
3,706
79.9
FY2021 4Q
4,556
3,512
76.9
(Ref.) Equity amount: FY2022 2Q: 3,697 million yen, FY2021 4Q: 3,505 million yen.

BPS（Book-value
Per Share）（JPY）
144.31136.84

2. Dividends
1st quarter（JPY）

Annual cash dividends per share
2nd quarter3rd quarter
Year-end
（JPY）
（JPY）
（JPY）
2.50
6.00
－

Total
（JPY）
8.50

6.50

9.50

FY2021 4Q－
ended Dec. 31, 2021
FY2022 2Q
3.00－
ended Dec. 31, 2022
FY2022 4Q
ending Dec. 31, 2022－
(Forecast)(Note) Revisions to the dividends forecast since the latest announcement: None

3. Forecast for the Fiscal Year Ending December 31, 2022 (From Jan. 1, 2022, to Dec.31, 2022)* Figures are rounded down to the nearest million yen, except share and per share data
* “ %” indicates year-on-year changes from the previous corresponding period
Net income
Operating
Ordinary
attributable
to Basic Earnings
Revenue
IncomeIncomeowners of the
Per Share
parent company(JPY MM)%(JPY MM)%(JPY MM)FY2022 4Q
4,937 (0.6)
1,085
17.8
1,091
(Full year)(Note) Revisions to the forecast since the latest announcement: None

%

15.5

(JPY MM)

716

%

12.6

(JPY)

27.96

※ Notes;(1) Changes in Significant Subsidiaries during the Current Quarter
Changes in specified subsidiaries that caused a change in the scope of consolidation: None
Newly included companies: None
Newly excluded companies: None
(2) Simplified Accounting Procedures and Specific Accounting Procedures: None
(3) Changes in Accounting Policies and Accounting Estimates(i) Changes in accounting policies as required by newly promulgated account pronouncement: Yes(ii) Changes other than (i) above: None(iii) Changes in accounting estimates: None(iv) Restatement: None
(Note)For more detailed illustration, please refer to “2. Quarterly Consolidated Financial Statements and Notes (4)Notes to Quarterly Consolidated Financial Statements (Changes in Accounting Policies)” on page 10 of theattached document.
(4) Number of Shares Outstanding (Ordinary Shares)

Number of shares outstanding at the end of theperiod (treasury shares included)
Number of treasury shares at the end of theperiodFY2022 2Q(As of Jun. 30, 2022)

FY2021 4Q(As of Dec.31, 2021)

26,608,800

26,608,800

990,575

995,175

FY2022 2Q
FY2021 2Q(From Jan.1, 2022,(From Jan.1,2021,
to Jun. 30, 2022)
to Jun. 30, 2021)
25,614,852
25,606,230
Average number of shares during 2Q(Note) The number of treasury stock at the end of the period includes our shares held by Japan CustodyBank, Ltd. (Trust Account E). (164,200 shares for FY2022 2Q, 168,800 shares for FY2021 4Q)
Also, our shares held by Japan Custody Bank, Ltd. (Trust Account E) are included in the treasury stock
deducted in the calculation of the average number of shares during the period. (167,573 shares for FY2022
2Q, 176,195 shares for FY2021 2Q)* This quarterly financial results report is out scope of the quarterly review by a certified public accountant nor
audit firm.
* Explanation on appropriate use of performance forecasts and other special notes.
The performance forecast described in this report are based on information that is available to the Group, as well as
certain assumptions and estimates that are deemed to be reasonable, and we make no assurance that suchdescriptions prove to be correct. Actual figures may significantly differ due to various factors.

Table of Contents
1. Status of the Group(1) Business Overview and Results for the Second Fiscal Quarter………………………………….…......
(2) Explanation on the Financial Position ………………………………………………………………….
(3) Explanation on Future Performance Forecast ………………………………………………………….
2. Quarterly Financial Statements and Notes255(1) Quarterly Consolidated Balance Sheet …………………………………………………………………
(2) Quarterly Consolidated Statement of Income and Comprehensive Income
Quarterly Consolidated Statement of Income, Cumulative……………………………………………
Quarterly Consolidated Statement of Comprehensive Income, Cumulative ………………………….

678(3) Quarterly Consolidated Cash Flows …………………………………………………………………… 9(4) Notes to Quarterly Consolidated Financial Statement
Note on Going Concern ………………………………………………………………………………. 10
Note on Significant Change in Equity Capital ………………………………………………………... 10
Changes in Accounting Policies ……………………………………………………………………….
Application of Accounting Standard for Fair Value Measurement, etc..……………………………
Additional Information ………………………………………………………………………………..
Segment Information etc.………………………………………………………………………………
Revenue Recognition ………………………………………………………………………………….
Significant Subsequent Event………………………………………………………………………….

10
10
10
11
12
12

3. Supplementary Information ………………………………………………………………………………. 13- 1 -1. Status of the Group(1) Business Overview and Results for the Second Fiscal Quarter
The Group addresses wide range of medical industry needs and develops the best-in-class and highly scalable
integrated medical solutions, from comprehensive medical systems to medical equipment, and delivers to large
hospitals and small- and medium-sized healthcare organizations nationwide. Also, leveraging our technologies andreputation, the Group also proposes and implements our office systems to ministries, local governments, and public
corporations. Further, unlocking the future, the Group has already embarked on emerging area, such as health techand medical cloud computing.
Due to the impact of the novel coronavirus and emerging variants (hereafter referred to as “COVID-19”)
pandemic, looking to the future, utilization of Information and Communication Technology (hereafter, referred toas “ICT”)) and artificial intelligence (hereafter, referred to as “AI”), non-contact medical care has been morewidespread than ever, including the online diagnoses and the medical robots.
We’ve witnessed incredible technological advances in medical industry and the solutions that support it, and as
the Japanese government has designated 2022 as the first year of medical DX (Digital Transformation), announcingthat industry, government, and academia will work together to make great strides in digitizing healthcare data andto promote the utilization of medical big data, initiatives are gaining momentum in this area toward, such as
harnessing real-world evidence that accelerates the discovery and development of new therapies. Accordingly, thehealthcare organizations are further encouraged and expected to adopt the state-of-the-art healthcare IT systems.
In this business environment, revenue was 2,233,641 thousand yen for the second quarter (January 1, 2022, toJune 30, 2022), a decrease of 7.1% compared to the same period of previous fiscal year. Operating income
decreased by6.8% to 455,696 thousand yen, ordinary income decreased by 4.7% to 481,236 thousand yen, and net
income attributable to owners of the parent decreased by 6.1% to 319,996 thousand yen, respectively.
Compared to the annual forecast, the progress of second quarter was 45.2% for revenue, 42.0% for operating
income, 44.1% for ordinary income, and 44.7% for net income attributable to shareholders of the parent company,
respectively.
The "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020.) has been
applied from the first quarter of the current fiscal year and the impact of the on the quarterly consolidated financial
statements was not material.
For more detailed illustration, please refer to “2. Quarterly Consolidated Financial Statements and Notes (4)Notes to Quarterly Consolidated Financial Statements (Changes in Accounting Policies) and (Segment
Information) 2. Matters regarding the change in the reporting segments, etc.”
The COVID-19 pandemic and efforts to control its spread have had a significant, ongoing adverse impact on
economic activities and daily life as well as the Group’s operations and the operations of the Group’s healthcare
clients. While demand for system upgrades remained stable, because our hospital and other healthcare provider
clients have understandably prioritized their resources, capacity and staff as the COVID-19 outbreak continues tostrain their organizations, the prolonged outbreak of COVID-19 is changing healthcare organizations' willingness
to system investment and their acceptance of new systems.
If any changes in performance are expected, we will appropriately disclose them in a timely manner.
Effective on July 1, 2022, EMC Healthcare Co., Ltd (hereafter referred to as "EMCH"), formerly ourconsolidated subsidiary, has become an equity method affiliate of the Company because of the exercise of stock
options (stock acquisition rights) by directors and employees of EMCH. Still, we are further committed to working
with EMCH as its shareholder to enhance its corporate value.
The impact of this event on our performance for the fiscal year ending December 31, 2022, is expected to beminimal.
In the Group’s efforts to foster ESG management, the Group conduct “as is” analysis, and discuss the “to be”
ESG structure that we should aim for. As one of our initiatives, we actively respond to the Carbon Disclosure
Project.
We will fulfill our social responsibility as a company that helps healthcare organizations advance the quality andefficiency of their healthcare and achieve people's healthier life. Built on our philosophy “as an R&D-driven
company, continues to pursue new ideas and technologies, toward prosperous society”, we will continuously takethorough measures to prevent infection throughout the Group and ensure the safety of our stakeholders.

- 2 -(JPY in Thousands)(a)Revenue by Business Segments
Business segment
System development
Healthtech

FY2021 2Q

FY2022 2Q

Change (amount)

Change (%)

2,390,145

2,171,849(218,295)(9.1％)

16,71863,27646,558278.5％(JPY in Thousands)(b)Operating Income by Business Segments
Business segment

FY2021 2Q

FY2022 2Q

Change (amount)

Change (%)

System development

601,950

573,115(28,834)(4.8％)

Healthtech(112,950)(117,418)--≪System Development Business≫
Operating results of the system development business were revenue of 2,171,849 thousand yen (down 9.1% yearon-year) and segment income (operating income) of 573,115 thousand yen (down 4.8% year-on-year), respectively.
〇 Medical System
The Group is a leading company of healthcare information technology solutions and services and offers a wide
range of intelligent solutions and tech-enables services. Amongst of them, “Claio”, electronic image filing system,“C-Note”, electronic medical record system, and “DocuMaker”, document management system, are flagshipsolutions and have maintained a high reputation and stable market share in large healthcare organizations.
Healthcare professionals can be provided insights to improve healthcare quality, with more complete picture of apatient’s long-term medical experience, rather than seeing individual events such as a single diagnosis or treatment
plan. As core infrastructure system, we have become deeply embedded in the day-to-day operations of healthcareorganizations, and our fit-for-purpose solutions are indispensable to such organizations that provide advanced
medical care.
During this quarter, we have been continuously gaining shares, and 26 hospitals and 48 clinics newly adopted,
augmented, or updated our solutions, resulting in cumulative revenue of 2,120,223 thousand yen.
As for the progress of the strategic alliance with Toyota Tsusho Corporation (hereafter referred to as "Toyota
Tsusho"), we took a big leap. first collaborative project to implement our flagship product Claio to Sakra World
Hospital (location, Bangalore, India), the localization has been completed through requirement definition phase.
Test operation will be launched during the second quarter of this consolidated fiscal year.
We have built trusted medical solutions and services in Japan. Scaling to next height, in this fiscal year, we will
focus on sales of the packaged products to our existing customers as well as new customers, and with an eye on
sales of Claio and C-Note in India and the ASEAN region, we will be fully engaged in the overseas expansion ofthis business.
Fitting Cloud Inc., the Group subsidiary which delivers cloud-enabled solutions, continued development of acloud-based EDC (Electronic Data Collection) system and a cloud-based virtual browsing environment during
April to June of this fiscal year. As for cloud-based EDC systems, we have achieved integration into other systems
through secure API (application programming interfaces) development. As for the cloud-based virtual browsing
environment, we are aiming to launch the service by the end of this year, toward more integrated and seamlesswithin the health record, enabling holistic viewing and actionable insights for patient care.
〇 Office System
In this area, we deliver products, mainly such as “DocuMaker Office”, document management systems. Spurred
by DX acceleration, as ministry-affiliated organizations and local governments began to consider the introductionof electronic approval and official document management systems, inquiries and pre-sale consultations are
increasing for both packages for ministries and local governments and for healthcare organizations. Sales of thisproduct have been steady to the target for this fiscal year, with 17 new or additional installations during the second
quarter of this consolidated fiscal year, resulting in cumulative revenue of 51,626 thousand yen.
During the second quarter of this consolidated fiscal year, one project has launched operation at a ministryaffiliated organizations, one project is in progress. In those large-scale projects, we have established trusted
relationship by our proven abilities and solutions, and highly reputed for “Close on-site engagement with clients,- 3 -with high consulting skills to identify issues and propose precise solutions” and “High UI/UX, easy-to-use systemfrom the user’s perspective”, and we have been steadily winning several large-scale projects. We will continuously
make proposals and accelerate digitalization not only of local governments, but also of independent administrative
agencies and foundations who have been facing issues similar to those of local governments. In the medical field,
we also expect high demand, especially from large and medium-sized healthcare organizations, which are ourexisting users, and we have received many inquiries about this cloud-based service that supports the back-office
operations.
≪Healthtech≫Operating results of the Healthtech segment were revenue of 63,276 thousand yen (up 278.5% year-on- year) andsegment loss (operating loss) of 117,418 thousand yen (segment loss of 112,950 thousand yen for the comparable
previous quarter of FY2021), respectively.
〇 Gaze Analyzing PerimeterIn this segment, we focused our efforts on domestic sales and on strategy formulation of overseas sales expansion
on our GAP (Note 1), an optokinetic analysis perimetry, and GAP-screener (Note 2). The GAP is an affordable, but
breakthrough wearable device that contributes to the early detection of retina diseases such as glaucoma. Thissolution eliminates the need for a dark room, which was formerly needed for exam, shortening exam time andreduces the patient’s burden.
Furthermore, by promoting the use of this solution at comprehensive medical exams and healthcare organizations,and by collecting real-world data, contribution to the technological and solution innovation, in various fields suchas pharmaceuticals and life insurance, can be expected, because scientists and doctors will be able to conduct datadriven analysis and develop actionable insights.
As of June 2022, this perimetry has already been introduced to 26 medical organizations in Japan. In Japan, we
conducted everything from design to manufacture, and introduction to university hospitals and clinics has beenproceeded. By loaning them on a free-of -charge basis, and on a usage-based-rate basis, clinical field testing has
been conducted as an optional item.
We will strive to introduce our GAP-screener to domestic health checkup facilities under strategic collaboration
with Toyota Tsusho.
Preparations for the overseas sales, which had been taking some time, are now underway, and within this year, we
will embark on sale of GAP in Europe, Middle East, Northern Africa through the sales channels of Rexxam Co.,
Ltd. (headquartered in Osaka, Japan).
Innovating healthcare, additionally, the Group has been continuously conducting joint research with Kyoto
University, further expedited, and motivated by the discovery that our solution could provide objective values tohelp to understand the symptoms of disorders and is effective for detecting not only visual field abnormalities but
also MCI (early-stage dementia).
Japan Agency for Medical Research and Development (“AMED”) adopted, in its FY2021 Artificial Intelligence
Implementation Research Project for Medical Engineering Collaboration, “the R& D of a screening program forslight cognitive dysfunctions, utilizing digital phenotyping of gaze point response and eyeball movements”.
Innovative medical devices will be introduced over the next several years. To accelerate our successful growth, wewill continue to engage in R& D from various perspectives, in order to solve many of the problems faced by the
aging society.
(Note 1) Gaze Analyzing Perimeter, GAP(Notification No. of medical device manufacturing and sales 38B2X10003000002)(Note 2) Gaze Analyzing Perimeter, GAP-screener(Notification No. of medical device manufacturing and sales 38B2X10003000003)〇 Midday Nap Monitoring System
In the area of digital, data and AI powered image analysis, the Company delivers "Baby moni," a monitoring
system designed to support observation and recording during midday nap time (Note 3). This solution is driven by
AI to analyze camera images, enabling simultaneous monitoring of several infants sleeping in bed.
In addition to sales in the Tokyo metropolitan area, we launched nationwide sale campaign last fiscal year andhave been establishing a nationwide sales track record. Also, inquiries have increased rapidly since last fiscal year
by promoting the deals at sales agencies and by promoting the system integration with major childcare ICT- 4 -providers. In June 2022, the Company was successfully selected as an IT introducing supporter and this Baby moni
was adopted as a subsidized IT tool for the "IT Introduction Subsidy 2022" promoted by the Ministry of Economy,
Trade and Industry. Leveraged on this occasion, we are well positioned to lead productivity revolutions, and we
expect further implementation into wider range of customers.
(Note 3) Midday nap: Infants’ midday nap at nursery school〇 Nursing Care DX Services
In nursing care field, we are developing a new product, “OwlCare”, a DX service. In today's nursing facilities,
there is an urgent need to both reduce the nighttime workload such as patrolling and watching over residents and to
improve the staff shortage and quality of nursing care. By integrating various sensors and nurse call systems
through this product, it is possible to reduce the workload of staff while keeping an eye on residents' healthconditions. At the same time, the system will contribute to solving management issues such as securing care staff
and efficient staffing.
OwlCare" is a product that brings together the sensor technology, camera technology, image analysis technology,
AI and data analysis technology, and other technologies that EMC Healthcare has nurtured, we are aiming for afull-scale market launch this fiscal year.
Nursing facilities that have introduced this solution have highly evaluated it from the perspective of improving
the quality of care and operational efficiency, leading to further inquiries. We will continuously contribute toimprovement in care quality and efficiency, and the health and wellness of people. Development is under steadyprogress, with field demonstrations beginning this fiscal year.
(2) Explanation on the Financial Position
Status of Assets, Liabilities, and Net assets
Total assets at the end of the second quarter amounted to 4,628,045 thousand yen, an increase of 71,482 thousand
yen from the end of the previous fiscal year. This was primarily due to an increase of 5,617 thousand yen in current
assets, which is mainly composed of an increase of 692,893 thousand yen in cash and deposits, an increase of 1,627
thousand yen from materials and supplies, partially offset by a decrease of 693,197 thousand yen in notes
receivable, accounts receivable and contract assets and due to an increase of 65,864 thousand yen in non-current
assets, which is mainly composed of an increase of 37,542 thousand yen in tangible assets and an increase of
18,590 thousand yen in investments and other assets, respectively.
Liabilities amounted to 921,800 thousand yen, a decrease of 122,228 thousand yen from the end of the previous
fiscal year. This was primarily due to a decrease of 173,915 thousand yen in current liabilities, which is mainlycomposed of a decrease of 149,598 thousand yen in accounts payable-trade and a decrease of 48,644 thousand yen
in income taxes payable, partially offset by an increase of 51,687 thousand yen in long-term liabilities.
Net assets amounted to3,706,244 thousand yen, an increase of 193,711 thousand yen from the end of the previous
fiscal year. This was primarily due to an increase in shareholders' equity of 192,025 thousand yen resulting from anincrease of 188,477 thousand in retained earnings.
(3) Explanation on Future Performance Forecast
The consolidated performance forecasts for the full year ending December 31, 2022, have been unchanged ever at
the time of the announcement of the full-year financial results on February 9, 2022.
We will disclose any expected changes in our business results, in a timely manner, which might be derived from,such as harbinger of COVID-19 pandemic calming down, and resurgence of new system accommodation byhealthcare organizations.

- 5 -2. Quarterly Financial Statements and Notes(1) Quarterly Consolidated Balance Sheet(JPY in Thousands)
FY2021 4Q(As of Dec. 31, 2021)
ASSETS
CURRENT ASSETS:
Cash and deposits
Note and account receivable
Note and account receivable– trade, and contract assets
Inventories
Work in process
Materials and supplies
Other current assets
Total current assets
NON-CURRENT ASSETS:
Tangible assets
Intangible assets
Software
OthersTotal intangible assets
Investments and other assets
Total non-current assets
TOTAL ASSETSLIABILITIESCURRENT LIABILITIES:
Accounts payable
Short-term borrowings
Accrued expenses
Income taxes payable
Other current liabilities
Total current liabilities
LONG-TERM LIABILITIES:
Provision for stock compensation
Other long-term liabilities
Total long-term liabilities
TOTAL LIABILITIESNET ASSETS
Shareholders’ equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Stock subscription rights
Non-controlling interests
TOTAL EQUITYTOTAL LIABILITIES and NET ASSETS- 6 -FY2022 2Q(As of Jun.30,2022)

2,171,974
1,218,805

2,864,868--

525,608

123,858
16,492
142,988
31,481
3,705,601

124,814
4,384
144,615
46,9283,711,219

71,256

108,798

238,600
344
238,944
540,760
850,961
4,556,563

248,331344
248,675
559,351
916,825
4,628,045

223,627
20,00098,621
223,933
259,544825,726

74,028110,000
81,706
175,288
210,787
651,810

163,649
54,653
218,303
1,044,029

161,398
108,592
269,990921,800

254,259
224,259
3,844,949(818,446)
3,505,021
4,743
2,769
3,512,533
4,556,563

254,259
224,259
4,033,426(814,898)
3,697,047
4,743
4,454
3,706,244
4,628,045

(2) Quarterly Consolidated Statement of Income and Comprehensive Income(Quarterly Consolidated Statement of Income, Cumulative)（JPY in Thousands）

Revenue
Cost of revenue
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Foreign exchange gain
Subsidy income
Royalty income
Miscellaneous income
Total non-operating income
Non-operating expenses
Interest expense
Amortization of organizing expenses
Total non-operating expenses
Ordinary income
Income before income taxes
Income tax -current
Income tax -deferred
Total income taxes
Quarterly net income
Quarterly net income (loss) attributable tononcontrolling interests
Quarterly net income attributable to owners of theparentFY2021 2Q(From Jan. 1, 2021,
to Jun. 30, 2021)
2,405,378
1,095,124
1,310,253
821,254488,999

FY2022 2Q(From Jan. 1, 2022,
to Jun. 30, 2022)
2,233,641
906,677
1,326,964
871,267
455,696

10
5,989
8,740
1,390
341
16,47010
21,150
2,654
1,390
783
25,988361
361
505,109505,109
162,209
2,930
165,139
339,969448
448
481,236481,236
162,030(2,475)
159,555
321,681

(636)

1,685

340,605

319,996- 7 -(Quarterly Consolidated Statement of Comprehensive Income, Cumulative）（JPY in Thousands）

Quarterly net income
Quarterly comprehensive income(Components)
attributable to owners of parent
attributable to non-controlling interests

FY2021 2Q(From Jan. 1, 2021,
to Jun. 30,2021)
339,969
339,969

FY2022 2Q(From Jan. 1, 2022,
to Jun. 30, 2022)
321,681
321,681

340,605(636)

319,996
1,685

- 8 -

(3) Quarterly Consolidated Statement of Cash Flows（JPY in Thousands）
FY2021 2Q(From Jan. 1, 2021,
to Jun. 30,2021)
Cash flow from operating activities
Income before income taxes and otheradjustments
Depreciation
Amortization of software
Increase (decrease) in provision for sharebased remuneration
Interest and dividend income
Interest expenses
Foreign exchange losses (gains)
Subsidy income
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Decrease (increase) in prepaid expenses
Decrease (increase) in accounts receivable
Increase (decrease) in trade payables
Increase (decrease) in accounts payable-other
Increase (decrease) in accrued expenses
Increase (decrease) in accrued consumption
taxes
Other
SubtotalInterest and dividends received
Subsidies received
Interest paid
Income taxes paid
Total operating activities
Cash flow from investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchases of property, plant, and equipment
Purchases of intangible assets
Purchase of investment securities
Proceeds from sales of shares of subsidiaries
and associates
Payments for investments in capital
Payment for leasehold deposits
Proceeds from refund of leasehold deposits
Other
Total investing activities
Cash flow from financing activities
Proceeds from short-term borrowings
Repayments of short-term borrowings
Dividends to shareholders
Proceeds from share issuance to noncontrolling shareholders
Total financing activities
Net increase (decrease) in cash and cash
equivalents
Cash and cash equivalents at the beginning of
periodCash and cash equivalents at the end of period- 9 -FY2022 2Q(From Jan. 1, 2022,
to Jun. 30, 2022)

505,109481,236

31,989124,627

35,752
96,521

1,246

1,297

(10)
(5,990)(8,740)96,694
36,148(3,843)
10,928(10,445)(69,168)(3,210)(10)448(21,150)(2,654)
731,967
7,625(11,525)
8,176(150,078)(16,562)(13,833)

4,284(60,771)(12,244)697,37410
8,740(110,639)
595,484(6,135)1,080,304
10
64,220(448)(209,730)
934,356(78,000)
78,000(51,824)(97,109)(56,700)(78,000)
78,000(62,120)(114,177)
-

1,650

-

(105,220)(30,011)70,398(256)(269,073)(1,280)50
434(177,093)(141,741)

100,000(10,000)(154,369)

3,000

-

(138,741)(64,369)

187,669

692,893

1,972,330

2,045,974

2,159,999

2,738,868

(4) Notes to Quarterly Consolidated Financial Statement(Note on Going Concern): N/A(Note on Significant Change in Equity Capital): N/A(Changes in Accounting Policies): Application of accounting standard for revenue recognition
The "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020. Hereinafterreferred to as the "Accounting Standard for Revenue Recognition”) has been applied from the beginning of the firstquarter of the current fiscal year, and revenue is recognized at the amount expected to be received in exchange forthe promised goods or services when control of the promised goods or services has been transferred to thecustomer.
As a result of this change, after reviewing the identification and satisfaction of performance obligations, theCompany has decided to recognize revenue over a certain period of time for some software development andsystem sales projects, whereas it had previously recognized revenue at a single point.
The Company has followed the transitional treatment prescribed in the provision of Paragraph 84 of the
Accounting Standard for Revenue Recognition, and the cumulative effect of retrospective application of the new
accounting policy prior to the beginning of the first quarter of the current fiscal year has been included in retained
earnings at the beginning of the first quarter of the current fiscal year. The impact of the on the quarterly
consolidated financial statement was not material.
Due to the application of Accounting Standard for Revenue Recognition "notes and accounts receivable," which
was included in "current assets" in the consolidated balance sheet for the previous fiscal year, is included in "notes,
accounts receivable and contract assets" in the consolidated balance sheet for the first quarter of the current fiscal
year. In accordance with the transitional treatment prescribed in Paragraph 89-2 of the Accounting Standard for
Revenue Recognition, no reclassification has been made to reflect the new presentation for the previous
consolidated fiscal year. Furthermore, in accordance with the transitional treatment prescribed in Paragraph 28-15of the“Accounting Standard for Quarterly Financial Statements” (ASBJ Statement No. 12, March 31, 2020),
information concerning disaggregating revenue from contracts with customers for the first six months of theprevious fiscal year is not presented.
(Application of Accounting Standard for Fair Value Measurement, etc.)
The “Accounting Standard for Fair Value Measurement” (ASBJ Statement No. 30, July 4, 2019), etc., have been
applied since the beginning of the first quarter of the current consolidated fiscal year. In accordance with thetransitional treatment prescribed in Paragraph 19 of the “Accounting Standard for Fair Value Measurement” andParagraph 44–2 of the “Accounting Standard for Financial Instruments” (ASBJ Statement No. 10, July 4, 2019),
the Company has decided to apply the new accounting policies set forth by the Accounting Standard for Fair Value
Measurement, etc. in the future. These changes had no impact on the Company’s quarterly consolidated financial
statements.
【Additional Information】(Accounting Treatment for Employee Stock Ownership Plan, J-ESOP）
At the Board of Directors meeting held on October 29, 2015, the Company resolved to introduce the "employee
stock ownership plan (hereafter referred to as “J-ESOP”)," an incentive plan to provide employees with ownershipinterest (stock) of the Company purchased from the market. The purpose of this incentive plan is to further
correlate the Company's stock price and performance with the treatment of employees, further sharing economic
benefits with shareholders, and to increase employees' motivation and morale toward the stock price andperformance enhancement.
In accordance with this introduction, Trust & Custody Services Bank, Ltd. (Trust Account E) (currently Custody
Bank of Japan, Ltd. (Trust Account E)) acquired 194,200 shares of the Company's stock between November 13,
2015, and November 26, 2015.
For accounting treatment of J-ESOP, the gross method is applied to record the assets and liabilities of the trust as
corporate assets and liabilities in the consolidated balance sheets, in accordance with the " Practical Solution on
Transactions of Delivering the Company’s Own Stock to Employees etc. through Trusts" (Practical Issues Task
Force No. 30, issued on March 26, 2015).

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Treasury stock held by Custody Bank of Japan; Ltd. (Trust Account E) is presented as treasury stock in the net
assets section of the quarterly consolidated balance sheets. The amount recorded at the end of the previous fiscal
year was 130,217 thousand yen and the number of shares was 168,800. The amount recorded at the end of thesecond quarter of the current fiscal year was 126,668 thousand yen and the number of shares was 164,200.
【SEGMENT INFORMATION, etc.】(Segment Information)
1. Sales and Income or Loss by Reportable Segment
FY2021 2Q (From January 1, 2021, to June 30, 2021)
Reportable segment
Systemdevelopment

Healthtech

Sub total(JPY in thousands）
Reported
amount for
Adjustment
consolidated(Note1)
financialstatements(Note 2)

Sales
Sales for external
2,388,659
16,7182,405,378
2,405,378
customers
Internal sales ortransfers between
1,485
1,485
(1,485)segments
Total
2,390,145
16,7182,406,863(1,485)2,405,378
Segment income or
601,950(112,950)
488,999
488,999
loss(Note) 1. Adjustments are derived from elimination of intersegment transactions.
2. Aggregated amount of segment income or loss equals amount of operating income reported forconsolidated financial statements.
FY 2022 1Q (From January 1, 2022, to June 30, 2022)
Reportable segment
Systemdevelopment

Healthtech

Sub total（JPY in Thousands）
Reported
amount for
Adjustment
consolidated(Note1)
financialstatements(Note 2)

Sales
Sales for external
2,170,364
63,2762,233,641
2,233,641
customers
Internal sales ortransfers between
1,485
1,485
(1,485)segments
Total
2,171,849
63,2762,235,126
2,233,641(1,485)
Segment income or573,115(117,418)
455,696455,696loss(Note) 1. Adjustments are derived from elimination of intersegment transactions.
2. Aggregated amount of segment income or loss equals amount of operating income reported forconsolidated financial statements.
2. Matters regarding the change in the reporting segments, etc.
As stated in the "Changes in accounting policies" section of this report, from the beginning of the first quarter ofthe current fiscal year, the Company has applied the "Accounting Standard for Revenue Recognition", etc. andchanged its accounting method for revenue recognition, and the measurement of income in the reporting segments
has been changed in the same way.
The impact of this change on " Sales to external customers" and "Segment income (loss)" for each reportablesegment for the second quarter of the consolidated fiscal year was not material.

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(Revenue Recognition)
The Group's revenues are primarily derived from revenues recognized from contracts with customers, and thefollowing information breaks down the Group's reportable segments by the timing of revenue recognition and typesof services.
FY 2022 2Q (From January 1, 2022, to June 30, 2022)（JPY in Thousands）
Reportable segment
System development
Healthtech
Timing of revenue recognition
Revenue recognized at apoint in time
Revenue recognized over a
period of time
Total

Total

1,088,760

62,947

1,151,707

1,081,603

329

1,081,933

2,170,364

63,2762,233,641（JPY in Thousands）
Reportable segment
System development
Healthtech
Segment, solution, channel
SoftwareHardwareSupport etc.
Other
Total

1,253,757
124,484
679,456
112,666
2,170,364

63,276
63,276

Total
1,253,757
124,484
679,456
175,943
2,233,641(Significant Subsequent Event)（Change in the scope of consolidation due to decrease in the equity ratio）
As an exercise of stock options (stock acquisition rights) by directors and employees of its consolidated
subsidiary, EMC Healthcare Co., Ltd. ("EMCH"), our shareholding in EMCH decreased, and we confirmed that
EMCH was excluded from its consolidated subsidiaries and became an equity method affiliate of the Company.
(1) Status of the shares held by the Company before and after the exercise of the stock acquisition rights andthe number of stock acquisition rights exercised by directors and employees of subsidiary(1) Number of shares held by the Company 1,023 shares
before exercise(Number of voting rights: 1,023）(Percentage of voting rights: 53.8%）(2) Number of exercises
2,289(Number of shares to be exercised: 2,289 shares）(3)

Number of shares held by the Company
after exercise

1,023shares(Number of voting rights: 1,023）(Percentage of voting rights: 24.4%）(2) Outlook
In accordance with the exercise of stock options, EMCH changed to an equity-method affiliate effective July 1,
2022. This improved the Company's consolidated operating income by approximately 30 million yen for the fiscal
year ending December 31, 2022. The impact of this event on our performance for the fiscal year ending December
31, 2022, is expected to be minimal.

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3. Supplementary Information(1) Transition of Significant Financial Key Performance Indicators(JPY in thousands, except per share amounts)
FY2021 2Q
FY2022 2Q
FY2021 4Q（Cumulative）
2,405,378
2,233,641

Net sales
Operating income
Ordinary income
Net income
Net income attributable to owners of the non-controllinginterests
Net income attributable to owners of the parent company
Comprehensive income
Net assets
Total assets
BPS (Book-value Per Share)

488,999
505,109339,969

455,696481,236
321,681920,720944,593635,796

(636)

1,685

(230)

340,605

319,996

636,027

339,969
3,276,920
3,957,260
127.96

321,6813,706,244
4,628,045
144.31

635,7963,512,533
4,556,563
136.84

13.30

12.49

24.84

EPS (Earnings Per Share)(2) Production, Order, Sales
1) Actual Result of Production for FY2022 2Q (Cumulative Amount)
Business segment
Production (JPY in Thousands)
System development
656,531
Healthtech
102,190
Total
758,721(Note) Figures above is calculated by total manufacturing cost for the current quarter.
2) Order Status for FY2022 2Q (Cumulative Amount)
Order received
Business segment
YoY (%)(JPY in Thousands)
System development
1,866,561
109.3
Healthtech
83,764205.7
Total

1,950,326

4,968,885

111.5

YoY (%)

Order backlog(JPY in Thousands)
1,150,206
47,070

86.0
107.4
88.4

YoY (%)
141.8
261.5

1,197,276

3) Sales Result for FY2022 2Q (Cumulative Amount by Segment, Solution, and Channel)
Sales amount
Segment, solution, channel
Ratio (%)(JPY in Thousands)
System development
Software1,253,757
56.2(of via sales agent）(369,725）
Hardware124,484
5.6(of via sales agent）(7,075）

144.4

YoY (%)

89.3
78.4

Support etc.

680,942

30.5

108.2

Other

112,666

5.0

57.1

Healthtech
63,2762.8
Adjustments（Note）(1,485)(0.1)
Total
2,233,641
100.0(Note) Adjustments are derived from elimination of intersegment transactions.

378.5
92.9

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