Consolidated Financial Statements for the Fiscal Year ended March 31, 2022.

There was a correction in p.2 (Balance Sheet) on May 31, 2022. Corrected parts were indicated with "*" marks.

28-Apr-2022

These financial statements have been prepared in accordance with accounting principals generally accepted in Japan.
NEC Networks & System Integration Corporation

Stock exchange listing: Tokyo
Code number:

1973

https://www.nesic.co.jp/english/index.html
1.Consolidated Results for the Fiscal Year ended March 31, 2022
(Rounded down to the nearest million yen.)(1) Net Sales and Incomes(Percentages represent change compared with the same period of the previous fiscal year.)Net sales(¥ million)

Year-on-year change(%)

Operating income(¥ million)

Year-on-year change(%)

Ordinary income(¥ million)

Year-on-year change (%)

Net income
attributable toowners of theparent(¥ million)

FY ended March/22

310,334(8.5)

23,181(9.3)

23,550(7.6)

15,021(4.6)

FY ended March/21

339,10911.7

25,563

57.4

25,49360.0

15,745

67.1

Ordinary income/
Total assets (%)

Operating income/Net sales (%)

Year-on-yearchange (%)（Note) Comprehensive income : FY Mar.2022 : ¥16,978 million/(5.6)% ; FY Mar.2021 : ¥17,983 million/82.0%

Net incomeper share (¥)

Net income per
Return on equity (%)
share (diluted) (¥)

FY ended March/22

100.85

—

11.6%

9.3%

7.5%

FY ended March/21

105.73

—

13.5%

10.6%

7.5%

（Reference) Equity in earnings (losses) of affiliates : FY Mar.2022 : ¥27million; FY Mar.2021 : ¥(49million)* The company conducted a three-for-one stock split for its common stock on June 1, 2020. The amount of "Net income per share" is calculatedon the assumption that the stock split had been carried out at the beginning of the previous consolidated fiscal year.
(2) Financial Position
Total assets(¥ million)

Net assets(¥ million)

Owner's equity ratio (%)

Net assets per share(¥)

31-Mar-22

254,701

138,14952.9

904.6631-Mar-21

250,338

127,11749.4

830.47c.f. Owner's equity: 31/3/2022 ¥134,742million ; 31/3/2021 ¥123,682million(3) Cash FlowsNet cash provided by (used in)operating activities(¥ million)

Net cash provided by (used in) investing
activities(¥ million)

Net cash provided by (used in) financing
activities(¥ million)

Cash and cash equivalents at end ofyear(¥ million)

FY ended March/22

22,674(7,162)(4,267)

79,732

FY ended March/21

17,383(4,289)(2,388)68,426

2. Dividends
Dividends per share (¥)

Total dividends paid
(full year, ¥million)

Payout ratio(consolidated) (%)

Dividends/Net assets(consolidated)(%)

1stquarter

Interim3rdquarter

Year-end

Full year

FY ended 3/2021—14.00

—

21.00

35.00

5,21233.1

4.5

FY ended 3/2022
FY ending 3/2023（Forecast)

—

19.00

—

24.00

43.00

6,404

42.6

5.0

—

23.00

—

23.00

46.00

44.8

3. Financial Forecasts for Fiscal Year ending March 31, 2023
(Percentages represent change compared to the previous corresponding period.)

Net sales

Operating income

Net income attributable to owners ofthe parent

Ordinary income

Net income
attributable toowners of theparent per share(¥ million)(%)(¥ million)(%)(¥ million)(%)(¥ million)

(%)

(¥)

6 Months ending 9/2022

147,000

4.3

7,700

1.07,900

0.1

4,800

2.0

32.23

FY ending 3/2023

330,000

6.3

26,00012.2

26,00010.4

15,3001.9

102.73

Cautionary Statement
Forecasts of results mentioned in this document are future estimates and are thus inclusive of risks and uncertain factors since they are not based ondefinite facts. Please be aware that a variety of factors could
cause actual results to differ significantly from those projected. The major factors affecting actual results include the economic climate and social trends surrounding the business of this Company’s group, consumer
trends vis-a-vissystems and services provided by this Company’s group, as well as pressure to lower prices and ability to cope with the market in response tointensified competition.Factors affecting results are notlimited to the ones mentioned above.

5. Consolidated Financial Statements(1) Consolidated Balance Sheets
As ofMarch 31, 2021
AssetsCurrent assets
Cash and cash equivalents
Notes and accounts receivable
Notes
Accounts receivable
Contract assets
Electronically recorded obligations
Purchased goods,materials and supplies
Work in process
OtherAllowance for doubtful accounts
Total current assets
Non-current assets
Property and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures (net)
Machinery and vehicles
Accumulated depreciation
Machinery and vehicles (net)
Furniture and fixtures
Accumulated depreciation
Furniture and fixtures (net)Land
Construction in progress
Other
Accumulated depreciation
Other (net)Total property and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Asset for retirement benefits
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Notes and accounts payable
Electronically recorded obligations
Short-term bank loans
Current installments of long-term debt
Accrued income taxes
Accrued consumption taxes
Advanced received
Contract liabilities
Accrued bunuses to directors and corporate auditors
Accrued warranty on products
Accrued losses on sales contracts
Accrued compensation for damage
Accrued office transfer cost
Other current liabilities
Total current liabilities
Long-term liabilities
Long-term debt
Liabilities for retirement benefits
Other liabilities
Total long-term liabilities
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury stock, at cost
Total shareholders' equity
Accumulated other comprehensive income
Net unrealized holding gain on other securities
Foreign currency translation adjustments
Accumulated adjustments for retirement benefits
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets(Millions of yen)
As ofMarch 31, 2022

68,426
123,313
－－－
1,256
3,456
8,052
7,388
(87)
211,806

79,732－ beforecorrection
319
82,554 * 90,490
28,665 * 20,729
987
2,623
8,155
11,204(80)
214,161

10,881(6,445)
4,435
249
(165)
83
15,900(12,295)
3,605
1,507
890
671
(349)
322
10,845

10,988(6,787)
4,201
236
(168)
67
16,634(12,499)
4,134
1,507
2,644
677
(425)
251
12,807

623
4,284
4,908

388
3,901
4,290

1,973
313
15,1985,347(54)
22,77738,531
250,338

4,180
281
13,6395,391(50)
23,44240,540254,701

44,188
2,649
6,360
3,298
5,954
3,500
7,708
－
159
83
512
711
6
16,341
91,474

40,486
1,217
9,190
264
4,019
2,150
－
8,229
145
114
2,107
4－
15,707
83,636466
29,233
2,046
31,745
123,220

3,202
27,714
1,998
32,914
116,551

13,122
16,68096,589(266)
126,125

13,122
16,694
105,673(259)
135,230169(533)(2,080)(2,443)
3,435
127,117250,338

1,242
(517)
(1,213)(488)
3,407
138,149
254,701

(2) Consolidated Statements of Income and Comprehensive Income(Consolidated Statements of Income)(Millions of yen)
FY Mar/2021

FY Mar/2022

Net sales

339,109

310,334

Cost of sales

275,179

246,861

Gross profit

63,92963,473

Selling, general and administrative expenses

38,36640,292

Operating income

25,56323,181

Interest income

2214

Dividend income of insurance

142

156

Reward income

67

99

Mid cancellation income

3490

Other

260

335

Total non-operating income

528

696

Interest expenses

97101

Loss on disposal of property and equipment

191

120

2040

Other

288

64

Total non-operating expenses

598

327

25,49323,550Gain on sale of investment in affiliates

228

141Total extraordinary inocome

228

141

Compensation for damage

976

324

Total extraordinary losses

976

324

Income before income taxes

24,74523,367

Income taxes - current

7,894

7,572

Income taxes - deferred

465

737

Income taxes

8,360

8,310

Net income

16,385

15,057

Net income attributable to non-controlling interests
Net income attributable to owners of the parent

639
15,74535
15,021Non-operating income

Non-operating expenses

Ordinary income
Extraordinary income

Extraordinary losses(Millions of yen)

(Millions of yen)

FY Mar/2021
Net income

FY Mar/2022
16,385

15,057Net unrealized holding loss on other securities

139

1,072

Deferred gains or losses on hedges(25)－Foreign currency translation adjustments

(219)

(16)

Adjustments for retirement benefit

1,703

866

(0)

(0)

1,598

1,921

17,983

16,97817,423

16,976560

2Other comprehensive income

Share of other comprehensive income of associates
accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to:
Owners of the parent
Non-controlling interests

(3) Consolidated Statements of Cash Flows

Cash flows from operating activities
Net income before income taxes
Depreciation and amortization
Amortization of goodwill
Increase (decrease) in allowance for doubtful receivables(Increase) decrease in asset for retirement benefit
Increase (decrease) in liability for retirement benefits
Increase (decrease) in accrued bonuses to directors and corporate auditors
Increase (decrease) in accurued warranty on products
Increase (decrease) in accurued losses on sales contracts
Increase (decrease) in accurued compensation for damage
Interest and dividend income
Interest expense(Increase) decrease in notes and accounts receivable(Increase) decrease in inventories
Increase (decrease) in notes and accounts payable
Increase (decrease) in accrued consumption taxes
Other, net
SubtotalInterest and dividend income received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of property and equipment
Proceeds from sale of property and equipment
Purchase of intangibles
Proceeds from sale of intangibles
Purchase of investment securities
Payments for sale of shares of subsidiaries resulting in change(Millions of yen)
FY Mar/2021

FY Mar/2022

24,7453,256
238
10(102)454
19(21)(1,646)(615)(47)
97(12,908)
－
1,645
3,799
899
3,173
22,99847(97)(5,565)
17,38323,367
3,279
271
(11)
27(302)
(13)
30
1,599
(707)
(54)
101
－
12,513730(5,179)(1,251)(1,419)32,982
54(101)(10,259)
22,674(3,025)11(663)0(450)(3,427)19(962)－(849)

in scope of consolidation
Loans receivable madeCollection of loans receivable
Other, net
Net cash used in investing activities
Cash flows from financing activities
Net increase (decrease) in short-term bank loans
Repayments of long-term debt
Proceeds from long-term deptNet (increase) decrease in treasury shares
Dividends paid to shareholders
Dividends paid to minority shareholders of subsidiaries
Other, net
Net cash provided by used in financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Decrease in cash and cash equivalents resulting from exclusion of subsidiaries

330(17)1(477)(4,289)

189
(18)
0(2,114)(7,162)

2,477
(298)
－
(3)
(4,162)(23)(379)(2,388)(66)
10,63858,321(532)

2,270(3,298)3,000
20(5,949)(30)(280)(4,267)61
11,30568,426－

Cash and cash equivalents at end of period
Cash and cash equivalents at end of period

68,42658,32179,732
68,426

(4) Segment Information
Business Segment

Year ended March 31, 2021
(Millions of yen)
Network Infrastructures

Engineering & Support
Survices

128,301

95,338103,718

9,518

---

336,877

125,960--125,960
13,76389,232--89,232
9,291

114,089--114,089
11,813

9,827--9,827794------(10,098)

339,109--339,109
25,563

Digital Solutions

Orders received
Sales(1) Sales to third parties(2) Intersegment sales
Total
Operating income (loss)

OthersAdjustments

Total*Our business segments were reorganized in line with our corporate management due to the replacement of some businesses and a revision in thedistribution of management resources implemented in April 2020 to optimize business efficiency. Segment information related to the first nine months of theprevious fiscal year was reclassified for disclosure to reflect the changes in this event.

Year ended March 31, 2022
(Millions of yen)
Digital Solutions

Orders receivedSales(1) Sales to third(2) Intersegment sales
Total
Operating income (loss)

Network
Infrastructures

Engineering & Support
Survices

OthersAdjustments

Total

121,729

100,889

109,927

4,213

---

336,759

110,344--110,344
13,04796,426--96,426
10,254

98,116--98,116
9,117

5,446
--5,446702------(9,940)

310,334--310,334
23,181