Consolidated Financial Results for the Six Months Ended September 30, 2023
(Under Japanese GAAP)
November 10, 2023
DKK Co., Ltd.
Listing: Tokyo Stock Exchange
6706
URL https://denkikogyo.co.jp/
President & Representative
Representative:(Title)(Name) Tadatoshi Kondo
Director
Managing Officer and Head of
Inquiries:(Title)(Name) Toshihisa Takayama Phone: +81-3-3216-1671
Finance Department
Scheduled date to file quarterly
Scheduled date to commence
November 14, 2023
December 4, 2023
securities report:
dividend payments:
Preparation of supplementary material on quarterly financial results: Yes
Company name:Securities code:

Holding of briefing on quarterly financial results: Yes (For institutional investors and analysts)(Yen amounts are rounded down to millions)
1. Consolidated financial results for the six months ended September 30, 2023 (from April 1, 2023 to September 30, 2023)(1) Consolidated operating results(Percentages indicate year-on-year changes.)
Net income attributable
Net sales
Operating income
Ordinary income
to shareholders of parent
company
Millions of yen% Millions of yen% Millions of yen% Millions of yen%
Six months ended
12,529(5.0)(1,163)(1,037)(811)－－－
September 30, 2023
Six months ended
13,185 (11.3)(1,192)
(906)
(637)
－
－
－
September 30, 2022
Note: Comprehensive Six months ended
Six months ended
189 million yen (-%)
(319) million yen (-%)
incomeSeptember 30, 2023
September 30, 2022
Net income per share

Diluted net income per
share

yen

yen

(79.92)－(56.69)－Six months ended
September 30, 2023
Six months ended
September 30, 2022
(2) Consolidated financial position

Total assets

Net assets

Equity ratio

Millions of yen

Millions of yen%

52,17540,462

76.6

55,13441,80174.8

Six months ended
September 30, 2023
Fiscal year ended
March 31, 2023
(Reference) Net asset excluding

Six months ended

non-controlling interests

September 30, 2023

39,953 million yen

Fiscal year ending

41,247 million yen

March 31, 2023

2. Dividends
Annual dividends
End of first quarter End of second quarter End of third quarter
Fiscal year ended
March 31, 2023
Fiscal year ending
March 31, 2024
Fiscal year ending
March 31, 2024
(forecast)End of fiscal year

Total

yen

yen

yen

yen

yen

－

30.00

－

30.00

60.00

－

30.00
－

30.00

60.00

Note: Revision to the most recently announced forecast for dividends: None

- 1 -

3. Forecast of consolidated operating results for the fiscal year ending March 31, 2024 (from April 1, 2023 to March 31, 2024)(Percentages indicate year-on-year changes.)
Net sales

Full year

Millionsof yen30,500%(4.1)

Net income
attributable to
Net income pershareholders of parent
share
company
Millions%%yenof yen(1,100)(108.29)－－

Operating income

Ordinary income

Millionsof yen(1,500)Millionsof yen(1,300)%－Note: Revision to the most recently announced forecast of operating results:

- 2 -

Yes

*Notes:(1) Changes in significant subsidiaries during the six months ended September 30, 2023 (changes in specificsubsidiaries resulting in changes in scope of consolidation):

None(Note) Although it doesn’t fall under the category of changes in specific subsidiaries, DKC Co., Ltd. (DKC) and Koshuha Co., Ltd. (Koshuha), which
had been consolidated subsidiaries of DKK Co. Ltd. (the Company) were removed from the scope of consolidation from the beginning of thefirst quarter of the current fiscal year. This was due to the fact that as a result of a merger where the Company was the surviving company, and
DKC and Koshuha were dissolved companies. In the second quarter of the current fiscal year, Cybercore Co., Ltd. was included in the scope of
consolidation because the Company acquired shares of Cybercore Co., Ltd. as of September 29, 2023. In addition, Cyber Core Vietnam Co.,
Ltd., a subsidiary of the company, was also included to the scope of consolidation.

(2) Application of accounting procedures particular to the
preparation of quarterly consolidated financial statements:

None(3) Changes in accounting policies and accounting estimates, and restatement(a) Changes in accounting policies due to revision ofNoneaccounting standards, etc.:(b) Changes in accounting policies other than (a):Yes(c) Changes in accounting estimates:

None(d) Restatement:

None

Note: For details, refer to “2. Quarterly consolidated financial statements and major notes, (3) Notes to quarterly
consolidated financial statements (Changes in accounting policies)” on page 11 of the attached document.
(4) Number of shares issued (common stock)(a) Shares issued (including treasury stock) at
the end of the period(b) Treasury stock at the end of the period(c) Average number of shares during the period(six months)

Six months ended
September 30, 2023
Six months ended
September 30, 2023
Six months ended
September 30, 2023

12,100,000 shares
2,128,891 shares
10,158,220 sharesFiscal year ended
March 31, 2023
Fiscal year ended
March 31, 2023
Six months ended
September 30, 2022

12,100,000 shares
1,638,476 shares
11,236,924 shares*This Quarterly Consolidated Financial Results report is not subject to quarterly review by certified public accountants or an auditing
firm.
*Explanation of appropriate use of earnings forecast, and other special notes
The forecast and other future projections in this report are based on information currently available to the Company and certain
assumptions the Company believes to be reasonable, and are not intended to be a promise by the Company that they will beachieved. Actual results may differ significantly due to various factors. Refer to “1. Qualitative information on quarterly financial
results, (3) Explanation of forecast of consolidated operating results and other future projections” on page 6 of the attachment for
the assumptions used in earnings forecast and notes on the use of earnings forecast.
The Company will have a live webcast of the financial results briefing for institutional investors and analysts on Thursday,
November 30, 2023. The materials used for the briefing will be posted to the Company’s website as soon as the briefing session
ends.

- 3 -

Table of Contents of Attachment
1. Qualitative information on quarterly financial results .........................................................................................................

5(1) Explanation of operating results ......................................................................................................................................

5(2) Explanation of financial position .....................................................................................................................................

6(3) Explanation of forecast of consolidated operating results and other future projections ...................................................

6

2. Quarterly consolidated financial statements and major notes ..............................................................................................

7(1) Quarterly consolidated balance sheet...............................................................................................................................

7(2) Quarterly consolidated statement of income and quarterly consolidated statement of comprehensive income ...............

9

Quarterly consolidated statement of income
Six months ended September 30 ........................................................................................................................

9

Quarterly consolidated statement of comprehensive income
Six months ended September 30 ........................................................................................................................

10(3) Notes to quarterly consolidated financial statements .......................................................................................................

11(Notes on going concern assumption) ..........................................................................................................................

11(Notes in case of significant changes in shareholders’ equity) .....................................................................................

11(Changes in accounting policies) .................................................................................................................................

11(Additional information) ..............................................................................................................................................

11(Segment information, etc.) .........................................................................................................................................

12

3. Supplementary information .................................................................................................................................................

13(1) Production, orders and sales ............................................................................................................................................

13

- 4 -

1. Qualitative information on quarterly financial results(1) Explanation of operating results
During the six months ended September 30, 2023, the Japanese economy gradually recovered, mainly in domestic demand as
behavioral restrictions due to COVID-19 alleviated, and capital investments remained strong backed by high levels of corporate
earnings. At the same time, there existed multiple risk factors such as continued rising commodity prices and soaring material
prices associated with the depreciation yen on top of the slowing down of the overseas economy and some weakness inconsumption. As a result, the outlook remained unpredictable.
In the telecommunications-related industry, where our group is involved, demand for 5G facilities in the mobile
communications field has remained stagnant or put on hold since the previous fiscal period due to revision of capital investment
plans by customers. Meanwhile, in the fixed wireless-related field, demand for administrative radio systems for disasterprevention is recovering, and in the broadcasting field, demand for equipment renewal by broadcasters continued to be sluggish.
The applied high-frequency devices industry showed signs of recovery in demand for capital investment in the automotiverelated field, but the underlying tone remained moderate. In all fields of business, cost raising factors such as spikes in prices ofenergy and components, etc. as well as labor costs continued to have an impact.
As a result, the Group posted orders received of 13,956 million yen, down 28.3% from a year earlier, and net sales of 12,529
million yen, down 5.0% year on year, for the six months ended September 30, 2023.
As for profits, the Group posted operating loss of 1,163 million yen (compared to operating loss of 1,192 million yen for the yearearlier period), ordinary loss of 1,037 million yen (compared to ordinary loss of 906 million yen for the year-earlier period), net
loss attributable to shareholders of parent company of 811 million yen (compared to net loss attributable to shareholders of parent
company of 637 million yen for the year-earlier period).
Results by segment are as follows. (Results of reportable segments, etc. include intersegment sales, etc.)(a) Telecommunication BusinessIn the mobile communications-related field, capital investment by mobile communication businesses remained limited overall,and demand for 5G capital investment was also stagnant or put on hold. In the fixed wireless-related field, demand foradministrative radio systems for disaster prevention to improve and digitalize disaster prevention system in local governments
was recovering due to extension of periods for emergency disaster prevention and reduction bonds. Defense-related demand
was also on an increasing trend. In the broadcasting-related field, demand among broadcast operators for maintenance wasincreasing; however, demand for upgrading digital broadcasting equipment remained on hold. In the solutions-related field, theCompany has been tapping new demand, leveraging synergetic effects gained from the Company’s technologies incollaboration with other companies. Furthermore, to swiftly establish the solution business, the Company acquired shares ofCybercore Co., Ltd. on September 29, 2023 and made it a subsidiary of the Company. By combining the wirelesscommunication technology and sensing technology centered on various cameras that the Company has been cultivating and theimage AI technology and sensing AI technology of Cybercore Co., Ltd., the Company will efficiently and arduously build thesolution business that utilizes the strengths of both companies. In other fields, the Company was continuously securing demandfor outdoor construction steel frames and surface treatment for steel structures, and actively pioneering demand for eco-friendly
products such as LED airplane warning lights and fuel cells.
Under such environment, we aggressively worked in this business field to capture demand and improve productivity. However,factors such as delayed delivery of parts and soaring raw material costs remained.
As a result, orders received decreased 29.8% year on year to 9,692 million yen, and net sales decreased 12.2% year on year to
8,034 million yen. Segment loss (operating loss) came to 291 million yen (compared to segment loss of 387 million yen in the
year-earlier period).
(b) Radio Frequency BusinessIn the mainstay high-frequency induction heating equipment business, demand from capital spending in the automotive industry
was on a recovery track, and the global semiconductor shortages and longer lead time for orders for components, etc. has been
gradually easing. In the field of contract heat treating service, demand is on a recovery trend, owing to the end of production
adjustment at automobile manufactures; however, the rise in costs due to soaring energy costs remained. In the new radio
frequency related field, we have been working on the sophistication of superheated steam technology and verification of theperipheral technologies for commercialization, in a bid to create demand for treatment of food and waste using superheatedsteam equipment. We have overcome challenges and accumulated data and expertise through repeated demonstration
experiments with various organizations and companies with which we had not worked before, and we have been making steadyprogress for pioneering new business domains.

- 5 -Under such business environment, this business also experiences rising costs due to soaring raw material costs and energy costs,
etc; however, we have been striving to increase profit by improving productivity and reviewing the sales price.
As a result, orders received decreased 24.6% year on year to 4,264 million yen, while net sales increased 11.5% year on year to
4,451 million yen. Segment income (operating income) decreased 20.6% year on year to 462 million yen.
(2) Explanation of financial position
Total assets totaled 52,175 million yen as of September 30, 2023, down 2,958 million yen from the end of the previous fiscal
year.
Current assets decreased 7,005 million yen from the end of the previous fiscal year to 33,656 million yen. The main factors
were increases of 655 million yen in inventories and 351 million yen in deposits paid included in “Other businesses” despite
decreases of 4,754 million yen in cash and deposits and 3,426 million yen in trade receivables including notes receivable-trade.
Non-current assets increased 4,047 million yen from the end of the previous fiscal year to 18,519 million yen. The main factors
were increases of 374 million yen in property, plant, and equipment, 1,397 million yen in goodwill, 961 million yen in
investment securities and 1,000 million yen in long-term time deposits.
Current liabilities decreased 1,608 million yen from the end of the previous fiscal year to 7,559 million yen. The main factors
were decreases of 1,334 million yen in trade payables including notes payable-trade and 244 million yen in contract liabilities.
Non-current assets decreased 10 million yen from a year earlier to 4,154 million yen. The main factors were increases of 55
million yen in long-term loans payable, despite decreases of 28 million yen in net defined benefit liability, 18 million yen inlease obligations and 15 million yen in long-term accounts payable included in other.
Net assets decreased 1,339 million yen from the end of the previous fiscal year to 40,462 million yen. The main factors wereincreases of 666 million yen in valuation difference on available-for-sale securities and 361 million yen in foreign currencytranslation adjustment, despite decreases of 1,128 million yen in retained earnings and 1,136 million yen in treasury stocks due
to purchase of treasury stocks.
(3) Explanation of forecast of consolidated operating results and other future projections
As a result of reviewing earnings forecasts to reflect recent earnings trends, etc., we revised the forecast of the consolidated
operating results for the fiscal year ending March 31, 2024 announced in “Consolidated Financial Results for the Fiscal Year
Ended March 31, 2023” dated May 11, 2023.
For details, please refer to “Revisions to the Forecast of the Consolidated Operating Results” separately released today.

- 6 -2. Quarterly consolidated financial statements and major notes(1) Quarterly consolidated balance sheet(Millions of yen)Previous consolidated fiscal year Current consolidated fiscal half
(March 31, 2023)(September 30, 2023)
AssetsCurrent assets
Cash and deposits
Notes receivable-trade
Electronically recorded monetary claims-operating
Accounts receivable from completed construction
contracts
Accounts receivable-trade
Contract assets
Costs on uncompleted construction contracts
Other inventories
Other Businesses
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant, and equipment
Buildings and structures
Machinery, equipment, and vehicles
Tools, furniture, and fixtures
Land
Lease assets
Construction in progress
Accumulated depreciation
Total property, plant, and equipment
Intangible assets
Goodwill
Other Businesses
Total Intangible assets
Investments and other assets
Investment securities
Long-term loans receivable
Net defined benefit assets
Long-term time deposits
Deferred tax assets
Other Businesses
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets- 7 -19,759419
1,537

15,004
415
1,795

5,108

1,441

3,175
3,715
17
5,720
1,211
(2)
40,662

3,331
3,546
106
6,286
1,732
(3)
33,656

11,179
9,799
7,475
2,251
268
169
(24,614)
6,529

11,164
10,224
7,357
2,256
249
124
(24,474)
6,903

－
598
598

1,397
545
1,942

4,549
1
831
－
886
1,123
(47)
7,344
14,472
55,134

5,510
2
821
1,000
1,020
1,365
(47)
9,672
18,51952,175

(Millions of yen)Previous consolidated fiscal year Current consolidated fiscal half
(March 31, 2023)(September 30, 2023)
Liabilities
Current liabilities
Notes payable, accounts payable for construction
contracts, and others
Short-term loans payable
Long-term loans payable to be repaid within a year
Lease obligations
Income taxes payable
Contract liabilities
Allowance for warranties on completed
construction contracts
Allowance for product warranties
Allowance for employees’ bonuses
Allowance for directors’ bonuses
Allowances for losses on construction contracts
Allowances for losses on liquidation of subsidiaries
and affiliates
Other Businesses
Total current liabilities
Fixed liabilities
Long-term loans payable
Lease obligations
Allowance for product warranties
Allowances for share-based remuneration for
directors and corporate auditors
Net defined benefit liability
Asset retirement obligations
Other Businesses
Total fixed liabilities
Total liabilities
Net assets
Shareholders’ equity
CapitalCapital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

- 8 -

4,045

2,711

2,200
90
48
116
728

2,360
241
43
109
483

18

17

83
662
9
6

78
684
－
27

76

23

1,079
9,168

778
7,559

1,260
75
18

1,316
56
18

75

77

2,626
49
58
4,164
13,332

2,598
49
38
4,154
11,713

8,774
9,693
25,019(3,897)39,5898,774
9,693
23,891(5,034)37,324

736
2
494
424
1,658
553
41,801
55,134

1,402
－
855
369
2,628
508
40,462
52,175

(2) Quarterly consolidated statement of income and quarterly consolidated statement of comprehensive income(Quarterly consolidated statement of income)(Six months ended September 30)(Millions of yen)
Year-earlier consolidated fiscal
half (from April 1, 2022
to September 30, 2022)

Current consolidated fiscal half(from April 1, 2023
to September 30, 2023)

4,383
8,744
57
13,185

4,160
8,310
58
12,529

4,208
7,293
22
11,523

3,958
6,916
20
10,895

175
1,451
35
1,662
2,854
(1,192)

202
1,394
37
1,633
2,796
(1,163)

9
91
348
449

10
81
134
226

13
124
26
163
(906)

19
20
61
101
(1,037)

105
105
(800)
55
(201)
(145)
(655)
(18)
(637)

－
－
(1,037)
77
(302)
(224)
(812)
(1)
(811)

Net sales
Sales of completed construction contracts
Net sales of goods
Sales in other businessTotal net sales
Cost of sales
Cost of sales of completed construction contracts
Cost of finished goods soldCost of sales in other businessTotal cost of sales
Gross profit
Gross profit on completed construction contracts
Gross profit on finished goods
Gross profit on other businessTotal gross profit
Selling, general, and administrative expenses
Operating loss
Non-operating income
Interest income
Dividend income
Other Businesses
Total non-operating income
Non-operating expenses
Interest expenses
Commitment fees
Other Businesses
Total non-operating expenses
Ordinary loss
Extraordinary income
Gain on sales of investment securities
Total extraordinary income
Net loss before income taxes
Income taxes-current
Income taxes-deferred
Total income taxes
Net loss
Net loss attributable to non-controlling interests
Net loss attributable to shareholders of parent company- 9 -(Quarterly consolidated statement of comprehensive income)(Six months ended September 30)(Millions of yen)
Year-earlier consolidated fiscal
half (from April 1, 2022
to September 30, 2022)

Current consolidated fiscal half(from April 1, 2023
to September 30, 2023)

(655)

(812)

(114)
(33)
536
(53)
335
(319)

666
(2)
393
(55)
1,002
189

(390)

159

70

29

Net loss
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to shareholdersof parent
Comprehensive income attributable to noncontrolling interests- 10 -

(3) Notes to quarterly consolidated financial statements(Notes on going concern assumptions)
There are no matters to be noted.
(Notes in case of significant changes in shareholders’ equity)
There are no matters to be noted.
(Changes in accounting policies)(Changes in inventory valuation)
The Company had adopted the moving-average cost method for valuation of inventories held as raw materials and supplies;
however, in the beginning of the first quarter of the current fiscal year, the Company changed the method to the gross-average
cost method.
The purpose of the change is to reflect more accurate periodic profit and loss, taking into account longer cycles of raw
materials and supplies and changes in their procurement prices.
The effect of the change on the past period is de-minimis.
(Additional information)
There are no matters to be noted.

- 11 -

(Segment information, etc.)[Segment information]
I Six months ended September 30, 2022 (from April 1, 2022 to September 30, 2022)
Information on amounts of net sales and income/loss by reportable segment(Millions of yen)Amountrecorded inquarterly
Adjustments
consolidated(Note) 2
statement ofincome(Note) 3

Reportable segment
TelecommuniRadiocationFrequency
Business
Business

Other
Businesses(Note) 1

Total

Total

Net sales
Sales to external customers
Intersegment sales ortransfers
Total
Segment income (loss)

9,133

3,994

13,12857

13,185－

13,185

16

－

16

96

113

(113)

－

9,150

3,994

13,144

154

13,299(113)

13,185

(387)

582

195

77

272

(1,465)(1,192)(Notes) 1 The “Other Businesses” segment, which is not included in reportable segments, includes equipment leasing and electric
power sales businesses.
2

3

The segment income (loss) adjustment of (1,465) million yen includes elimination of intersegment transactions of (42)million yen and corporate expenses of (1,422) million yen that are not allocated to any reportable segment. Corporate
expenses are mainly general and administrative expenses that are not attributable to any reportable segments.
Adjustments are made to reconcile segment income (loss) with operating loss in the quarterly consolidated statement ofincome.

II Six months ended September 30, 2023 (from April 1, 2023 to September 30, 2023)
Information on amounts of net sales and income/loss by reportable segment(Millions of yen)Amountrecorded inquarterly
Adjustments
consolidated(Note) 2
statement ofincome(Note) 3

Reportable segment
TelecommuniRadiocationFrequency
Business
Business

Other
Businesses(Note) 1

Total

Total

Net sales
Sales to external customers
Intersegment sales ortransfers
Total
Segment income (loss)

8,019

4,451

12,471

58

12,529－12,529

14

－

14

80

95

(95)

－

8,034

4,451

12,486

138

12,625(95)

12,529

(291)

462

170

70

241

(1,404)(1,163)(Notes) 1 The “Other Businesses” segment, which is not included in reportable segments, includes equipment leasing and electric2

power sales businesses.
The segment income (loss) adjustment of (1,404) million yen includes elimination of intersegment transactions of (35)
million yen and corporate expenses of (1,369) million yen that are not allocated to any reportable segment. Corporate
expenses are mainly general and administrative expenses that are not attributable to any reportable segments.

3

Adjustments are made to reconcile segment income (loss) with operating loss in the quarterly consolidated statement ofincome.

- 12 -

3. Supplementary information(1) Production, orders and sales(a) Production results
Production results by reportable segment for the six months ended September 30, 2023 are shown below.
Reportable segment

Output (millions of yen)

Year-on-year change (%)

Telecommunication Business

3,639(34.5)

Radio Frequency Business

4,611

7.1

8,251

(16.3)

Total(Notes) 1 Amounts are based on sales prices, and intersegment transactions have been offset.
2 In the Telecommunication Business, production results related to construction projects are excluded from the above
production results due to difficulty in defining the results.
(b) Results of orders received
Results of orders received by reportable segment for the six months ended September 30, 2023 are shown below.
Reportable segment
Telecommunication
Business

Orders received(millions of yen)

Year-on-year change (%)

9,692(29.8)

Radio Frequency Business

4,264

Total

13,956

Order backlog(millions of yen)

Year-on-year change (%)

10,203(24.4)(24.6)

3,326(24.8)(28.3)

13,530(24.5)(c) Sales results
Sales results by reportable segment for the six months ended September 30, 2023 are shown below.
Reportable segment

Net sales (millions of yen)

Year-on-year change (%)

Telecommunication Business
Construction work

4,160

(5.1)

Equipment and materials
sales

3,858

(18.8)

Subtotal of
Telecommunication Business

8,019(12.2)

Radio Frequency Business

4,451

11.5

Total of reportable segments

12,471(5.0)

Other Businesses

58

0.8

Total

12,529(5.0)(Notes) 1 Intersegment transactions have been offset.
2 The “Other Businesses” segment, which is not included in reportable segments, includes equipment leasing and electric
power sales businesses.

- 13 -