Consolidated Financial Results for the First Quarter of
the Fiscal Year Ending March 31, 2024 (JGAAP)
July 31, 2023
Company name:
Tsuzuki Denki Co., Ltd.
Listing Stock Exchange: Tokyo
Stock code:
8157
URL: https://www.tsuzuki.co.jp/
Representative (title): Isao Emori, Representative Director, President and CEO
Contact (title):
Toshihiro Hirai, Managing Executive Officer
Tel: +81-50-3684-7780
Scheduled date for quarterly report submission:
Scheduled date for dividend payment:
Preparation of supplemental explanatory materials:
Results briefing to be held:

August 4, 2023—
No
No

1. Consolidated financial results for the first quarter of the fiscal year ending March 31, 2024
(April 1, 2023, to June 30, 2023)(1) Consolidated operating results

Net sales

Millions of yen (rounded down), % figures are year-on-year change
Quarterly profit
Operating income
Ordinary income
attributable toowners of parent

First quarter,——year ending
28,128
14.3%
698
673
448
—
March 31, 2024
First quarter,—year ended
24,609(0.9%)
(202)
(109)
—
(147)
—
March 31, 2023
Note: Comprehensive income was 943 million yen (—%) in first quarter of year ending March 31, 2024; (100)million yen (—%) in first quarter of year ended March 31, 2023.
Earnings per share
Diluted earnings per(yen)share (yen)First quarter,year ending
25.01—
March 31, 2024
First quarter,year ended(8.30)—March 31, 2023
(2) Consolidated financial position
Total assets
Net assets
Shareholders’
Net assets per share(millions of yen)(millions of yen)equity ratio(yen)First quarter,year ending
80,40535,54743.8%
1,961.25
March 31, 2024
Year ended
83,20735,38742.0%
1,950.05
March 31, 2023
Reference: Shareholders’ equity at first quarter, year ending March 31, 2024; 35,201 million yen; in year ended
March 31, 2023; 34,945 million yen.

1

2. Dividends
Dividends per share for the fiscal year (yen)End offirstquarter

End ofsecondquarter

End ofthird
quarterYearendTotal

Year ended
—
25.00
—
36.00
61.00
March 31, 2023
Year ending—
March 31, 2024
Year ending
March 31, 2024
38.00
—
38.00
76.00
(forecast)
Note:
1.Revisions to most recent dividend forecast: None
2.The interim dividend for the year ended March 31, 2023 included a commemorative dividend of 2.0 yen per
share to celebrate 90th Anniversary of its founding.
3. Forecast of consolidated financial results for the fiscal year ending March 31, 2024
(April 1, 2023, to March 31, 2024)% figures are year-on-year change
Profit attributable to Earnings
Net sales
Operating income Ordinary income
owners of parent
per share(millions of yen)(millions of yen)(millions of yen)(millions of yen)
(yen)
Full year

126,500

2.1%

5,300

3.6%

5,250

Note: Revisions to most recent earnings forecast: None2(2.0%)

4,450

26.4%

247.97

*Notes(1) Changes in significant subsidiaries (which affected scope of consolidation) during the quarter: None
Newly added ___ companies (names)
No longer consolidated ___ companies (names)(2) Special accounting methods used in preparation of quarterly consolidated financial statements: Yes
Note: For details, please refer to Attachment page 14: “2. Consolidated financial statements and notes (3)Notes to quarterly consolidated financial statements (Application of special accounting methods in the
preparation of quarterly consolidated financial statements)."(3) Changes in accounting policies, changes in accounting estimates, and restatements
1. Changes in accounting policies due to changes in accounting standards:
2. Changes in accounting policies not due to changes in accounting standards:
3. Changes in accounting estimates:
4. Restatements:

None
None
None
None

(4) Number of shares outstanding (common stock)
First quarter,
1. Number of shares outstanding at
Year ended
year ending
20,177,894
20,177,894
year end (including treasury stock)
March 31, 2023
March 31, 2024
First quarter,
2. Number of shares at year end
Year ended
year ending
2,229,287
2,257,664(treasury stock)
March 31, 2023
March 31, 2024
First quarter,
First quarter,
3. Average number of shares overyear ending
17,936,655
year ended
17,737,271
the period
March 31, 2024
March 31, 2023
Note: The number of treasury shares includes those held in the Employee Stock Ownership Plan (ESOP) trust
account (0 in first quarter, year ending March 2024; 13,300 in year ended March 2023), Directors’ Compensation
Board Incentive Plan (BIP) trust account (290,547 in first quarter, year ending March 2024; 290,547 in year ended
March 2023); and Stock-grant ESOP trust account (405,758in first quarter, year ending March 2024; 420,865 inyear ended March 2023).
*The financial information in this quarterly report is not subject to review by certified public accountants or auditing
firms.
*Appropriate use of earnings forecast and other special notes.
(Note on forward-looking statements)
The earnings forecasts and other forward-looking statements contained in this document are based on
information currently available to the Company, and certain assumptions it considers reasonable, but are notintended to be a promise that the Company will achieve. Actual results may vary materially from forecasts due toa variety of factors.

3

Content of attachment
1. Qualitative information on quarterly results ..............................................................................................5(1) Earnings ..............................................................................................................................................................5(2) Financial position ...............................................................................................................................................9(3) Consolidated earnings forecasts and other information concerning the outlook .....................................9
2. Consolidated financial statements and notes .........................................................................................10(1) Quarterly consolidated balance sheet ..........................................................................................................10(2) Quarterly consolidated statements of income and comprehensive income ...........................................12(3) Notes to quarterly consolidated financial statements .................................................................................14(Notes on premise of going concern)..............................................................................................................14(Notes on significant changes in the amount of shareholders equity.) ......................................................14(Application of special accounting methods in the preparation of quarterly consolidated financial
statements) .........................................................................................................................................................14(Segment and other information).....................................................................................................................15

4

1. Qualitative information on quarterly results(1) Earnings
In the first quarter of the fiscal year ending March 31, 2024, the Japanese economy gradually recovered,supported by improvements in the employment and wage conditions, among other factors. However, a sluggish
global economy against the backdrop of monetary policy tightening posed risk to the domestic economy, andrising prices and fluctuations in the financial and capital markets continued to warrant caution.
In the information and communications service industry to which the Group belongs, capital investments in ICT
continued to grow, driven by the acceleration of digital transformation initiatives of companies. In the electronic
devices industry, while the supply and demand balance of semiconductors moved toward normalization, themarket growth slowed due to changes in the environment, including a decline in personal consumption caused byrising prices globally.
Under these circumstances, the Group established a long-term vision spanning 10 years from the current fiscal
year, and we are currently in the middle of a three-year medium-term management plan, “Transformation 2026,”
toward achieving the long-term vision. In 10 years’ time, we envision ourselves to be Growth Navigator, anorganization that navigates growth and creates together with stakeholders, including customers. We aim to be acompany that continues to be chosen by customers as an organization that leads the way for growth. Having
positioned the next three years as the first stage toward realizing this goal, we will concentrate and transfer
resources to growth areas and strive to bolster our earnings capability. Further, to enhance corporate value, themost important theme for the Group, we will promote integrated measures spanning all aspects of business,finance, and non-finance, including management mindful of the cost of capital and strengthening of personnel
capital.
In the first quarter of the fiscal year ending March 31, 2024—the first year of the current medium-term
management plan, net sales amounted to ¥ 28,128 million (up 14.3% year on year), operating income ¥698
million (operating loss of ¥202 million in the same period of the previous fiscal year), ordinary income ¥673 million(ordinary loss of ¥109 million in the same period of the previous fiscal year), and profit attributable to owners ofparent ¥448 million (loss attributable to owners of parent of ¥147 million in the same period of the previous fiscal
year).
In the Information Network Solution segment, orders fell below the year-ago level due to a decline in large orders
for equipment, but net sales increased year-on-year, on the back of steady sales booking in the equipment andservice businesses, including sales from orders received in the previous fiscal year, and robust performance ofthe development and construction business. Profit increased, moving into the black in the first quarter, owing tosharp growth in sales and the success of various measures to improve the cost of sales and curb SG&A
expenses.
In the Electronic Devices segment, while the shortage of semiconductors, with some exceptions, began to
improve and customers' advanced order arrangements ran their course, sales of electronic parts, including
semiconductors, and power semiconductors for decarbonization and energy conservation-related applications
were robust, thanks to steady production at customers in the key industries of factory automation, industrial
equipment, and automotive devices. As a result, while orders were down year-on-year, net sales exceeded theyear-ago level. Profit also grew year-on-year, as sales growth offset higher SG&A expenses.

The following section discusses earnings by segment in the first quarter.
*Note regarding quarterly earnings for the Group
Many of the Group’s customers have business years from April through March the following year. Further,fulfilment obligations for many transactions are judged to be satisfied at a certain point, so the Group’s sales andprofit tend to be concentrated in September and March, the halfway and endpoints of the fiscal year

5

Information Network Solutions
In the first quarter of the fiscal year ending March 31, 2024, orders were ¥24,271 million (down 8.8% year onyear), net sales were ¥20,445 million (up 14.5% year on year), and operating income was ¥472 million(operating loss of ¥392 million in the same period of the previous fiscal year). While orders were down year-onyear, net sales and operating income surpassed the year-ago results.
Results by business model
Equipment: Orders declined year-on-year due to the falloff of orders for large projects acquired in the same
period of the previous fiscal year. Still, net sales were buoyed by increased sales of application
licenses in the service and finance industries and PCs to wholesalers and public institutions. As aresult, while orders were down to ¥8,576 million (down 26.3% year on year), net sales expanded
to ¥7,172 million (up 29.5% year on year). The Company recorded net sales from the orderbacklog accumulated since the previous fiscal year, but order backlog nevertheless remained
above the year-ago level at ¥18,846 million (up 14.9% year on year).
Development and construction: Orders for system development and infrastructure construction projects grew
sharply, and net sales from network and security system building projects held firm. As a result,orders amounted to ¥3,797 million (up 31.8% year on year) and net sales ¥2,687 million (up 4.3%
year on year). Order backlog was ¥5,780 million (up 21.0% year on year), owing to the buildup oforders in the first quarter of the fiscal year under review.
Service:

Orders for system and infrastructure maintenance and operation services grew, but overall orders
declined due to the downsizing of the large order for operation services received in the same
period of the previous fiscal year. Net sales benefited from growth in maintenance services driven
by increased equipment sales, including applications and PCs, as well as increased sales of thecloud-based PBX services, including TCV(TCloud for Voice). As a result, orders were down to¥11,896 million (down 1.7% year on year), but net sales rose to ¥10,584 million (up 8.7% year onyear). The Company recorded sales from a substantial portion of the order backlog accumulated
since the end of the previous fiscal year in the first quarter under review, but order backlog
nevertheless remained above the year-ago level at ¥5,056 million (up 4.1% year on year).

Profit increased, moving into the black in the first quarter under review, owing to substantial growth in sales,
improved cost of sales in equipment, development and construction, and service businesses on
steady implementation of the medium-term management plan, and a decline in personnel andother SG&A expenses.
Electronic Devices
In the first quarter of the fiscal year ending March 31, 2024, orders were ¥8,428 million (down 20.5% year onyear), net sales were ¥ 7,683 million (up 13.7% year on year), and operating profit was ¥216 million (up 20.8%
year on year). While orders declined year-on-year, sales and operating profit exceeded the year-ago levels.
In the devices business, while advanced order placement by clients, a trend that had continued since theprevious fiscal year, had wound down, sales in the factory automation, industrial equipment, air conditioning
equipment, and electric vehicle markets continued to hold firm, with sales of semiconductors, such as ASIC, andpower semiconductors for use in energy conservation-related devices also growing. As a result, while orders fell
below the year-ago level, net sales rose year-on-year.
In the systems business, while semiconductor shortages continued to be improved, prices dropped in thememory market due to excess supply and system demand for consumer equipment applications declined.
Meanwhile, increased demand for LCD panels for use in on-board automotive information devices backed byrecovery in automobile production and the expansion of embedded devices for industrial equipment contributed
to sales growth. As a result, both orders and net sales exceeded year-ago levels.

6

Profit increased year-on-year driven by sales growth, despite higher expenses to secure personnel for the
expansion of existing businesses and the establishment of new business models.

7

The following tables show sales and orders by segment in the first quarter of the fiscal year ending March, 2024.
(1) Net sales by segment (millions of yen)First quarter,year ended
March 2023
Information Network Solutions
17,851Equipment
5,540
Development and construction
2,576
Service
9,734Electronic Devices
6,758
Total
24,609Note:Inter-segment transactions are offset and eliminated.

First quarter, year ending March 2024
Versus first quarter of previous
year
20,445
7,172
2,687
10,584
7,683
28,128

2,594
1,632
111
850
924
3,519

114.5%
129.5%
104.3%
108.7%
113.7%
114.3%(2) Orders by segment (millions of yen)First quarter,year ended
March 2023
Information Network Solutions
26,620Equipment
11,630Development and construction
2,881
Service
12,108
Electronic Devices
10,596
Total
37,216
Note:Inter-segment transactions are offset and eliminated.

First quarter, year ending March 2024
Versus first quarter of previous
year
24,271
8,576
3,797
11,896
8,428
32,699(2,349)(3,054)916(211)(2,168)(4,517)

91.2%
73.7%
131.8%
98.3%
79.5%
87.9%

(3) Order backlog by segment (millions of yen)First quarter,year ended
March 2023
Information Network Solutions
26,043Equipment
16,408Development and construction
4,777
Service
4,857Electronic Devices
20,274
Total
46,318
Note: Inter-segment transactions are offset and eliminated.

8First quarter, year ending March 2024
Versus first quarter ofprevious year
29,6843,640
114.0%
18,8462,438
114.9%
5,780
1,003
121.0%
5,056
199
104.1%
19,386(888)
95.6%
49,0702,752
105.9%

(2) Financial position
As of the end of the first quarter under review (June 30, 2023), assets were ¥80,405 million, down ¥2,802
million from the end of the previous fiscal year (March 31, 2023). This mainly reflected a decline of ¥6,813 million
in notes and accounts receivable–trade and contract assets, which was only partially offset by increases of ¥2,175
million in inventories and ¥1,112 million in cash and deposits. Liabilities were ¥44,858 million, down ¥2,962 million
from the end of the previous fiscal year. The main reasons for the decline were decreases of ¥4,538 million innotes and accounts payable–trade, ¥1,318 million in provision for bonuses, and ¥554 million in income taxes
payable, which more than covered for an increase of ¥4,150 million in current liabilities (other). Net assets cameto ¥35,547 million, up ¥159 million versus the end of the previous fiscal year, and the equity ratio was 43.8%(versus 42.0% at the end of the previous fiscal year). This was mainly due to the recording of ¥448 million in profit
attributable to owners of parent and a ¥355 million increase in valuation difference on available-for-sale securities,
offsetting a decline in retained earnings due to dividend payments of ¥671 million.

(3) Consolidated earnings forecasts and other information concerning the outlook
The Company maintained its consolidated earnings forecast for the fiscal year ending March 31, 2024
(released May 12, 2023), as earnings in the first quarter under review were in line with the initial plan. However,in case matters arise that require public disclosure due to changes in the operating environment, etc., theCompany will promptly make an announcement.

92. Consolidated financial statements and notes(1) Quarterly consolidated balance sheet(Millions of yen)
As of March 31, 2023
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable – trade
Electronically recorded monetary claims
Inventories
Other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures (net)
Machinery, equipment and vehicles
Accumulated depreciation
Machinery, equipment and vehicles
(net)
Land
Lease assets
Accumulated depreciation
Lease assets (net)
Construction in progress
Other
Accumulated depreciation
Other (net)Total property, plant and equipment
Intangible assets
Goodwill
Lease assets
Other
Total intangible assets
Investments and other assets
Investment securities
Long-term loans receivable
Deferred tax assets
Other
Allowance for doubtful accounts
Investments and other assets
Total noncurrent assets
Total assets

10

As of June 30, 2023

20,877
27,866
4,383
11,6832,391(5)67,19621,98921,052
4,759
13,8592,211(6)63,8662,122(1,003)
1,118
7
(6)

2,122
(1,027)
1,095
7
(6)

1

1

1,804
4,367
(3,260)
1,106
124
1,217
(868)
349
4,504

1,804
3,637
(2,713)
924
145
1,221
(895)
325
4,296

45
632
1,933
2,610

22
569
2,093
2,685

3,471
28
4,265
1,180
(49)
8,896
16,011
83,207

3,985
27
4,442
1,160
(58)
9,557
16,53980,405

(Millions of yen)
As of March 31, 2023
Liabilities
Current liabilities
Notes and accounts payable – trade
Short-term loans payable
Current portion of long-term loans payable
Lease obligations
Income taxes payable
Provision for bonuses
Provision for loss on orders received
Other
Total current liabilities
Noncurrent liabilities
Long-term loans payable
Lease obligations
Deferred tax liabilities
Net defined benefit liability
Long-term accounts payable – other
Provision for share awards
Other
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive
incomeNoncontrolling interests
Total net assets
Total liabilities and net assets

17,144
4,853
141
888
968
2,513
－
6,550

11

As of June 30, 2023

33,06012,605
4,790
7
780
414
1,194
10
10,70030,505

4,111
998
7
8,826
28
637
149
14,76047,820

4,109
843
7
8,512
28
677
174
14,35344,8589,812
2,581
25,607(1,979)36,0229,812
2,581
25,385(1,942)35,836

1,132

1,487

2
193
(2,405)(33)
270(2,360)(1,076)(634)

441
35,387
83,207345
35,54780,405

(2) Quarterly consolidated statements of income and comprehensive income(Quarterly consolidated statement of income)Consolidated income statement for the first quarter(Millions of yen)Three months ended
June 30, 2022
Net sales
Cost of sales
Gross profit
Selling, general, and administrative expenses
Operating income (loss)
Non-operating income
Interest income
Dividend income
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses
Facility move out expenses
Loss on termination
Other
Total non-operating expenses
Ordinary income (loss)
Extraordinary loss
Loss on retirement of noncurrent assets
Total extraordinary losses
Income (loss) before income taxes and others
Income taxes
Profit (loss)
Profit attributable to noncontrolling interests
Profit (loss) attributable to owners of parent

12

Three months ended
June 30, 2023

24,60920,082
4,527
4,730
(202)

28,12822,781
5,346
4,648
698

1
42
45
38
127

1
39
－
13
55

29
－
－
5
34
(109)

24
34
17
3
80
673

1
1
(111)
(13)
(97)
49
(147)

0
0
673
172
501
52
448

(Quarterly consolidated statement of comprehensive income)First quarter(Millions of yen)Three months ended
June 30, 2022
Profit (loss)
Other comprehensive income
Valuation difference on available for salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Other comprehensive income
Comprehensive income
BreakdownComprehensive income attributable to ownersof parent
Comprehensive income attributable tononcontrolling interests

13

Three months ended
June 30, 2023

(97)

501

(97)

355

(38)
91
40
(3)
(100)

(35)
77
44
442
943

(150)

890

49

52

(3) Notes to quarterly consolidated financial statements(Notes on premise of going concern)
Not applicable.

(Notes on significant changes in the amount of shareholders equity.)
Not applicable.
(Application of special accounting methods in the preparation of quarterly consolidated financial statements)(Calculation of tax expense)
Tax expenses are calculated by reasonably estimating the effective tax rate after applying tax effect accounting
to income before income taxes for the fiscal year, including the first quarter, and multiplying quarterly income
before income taxes by the estimated effective tax rate.
Note: Income taxes – deferred are included in income taxes.

14

(Segment and other information)
Segment information
I First quarter of previous year (April 1, 2022, to June 30, 2022)
1. Information on net sales and profit or loss by reporting segment(Millions of yen)Amountrecorded inquarterly
Adjustments
consolidated(Note 1)
financialstatements(Note 2)

Reporting segment
Information
Network
SolutionsElectronic
Devices

Total

Net sales
Net sales from externalcustomers
Intersegment net sales andtransfers
Total
Segment profit (loss)

17,851

6,758

24,609－24,609

1

60

62

(62)

－

17,852

6,819

24,671(62)

24,609

(392)

179

(212)

10

(202)

Notes:
1 Adjustments to segment profit (loss) are elimination of intersegment transactions.
2 Segment profit (loss) is adjusted with operating income (loss) in the quarterly consolidated income statements.
II First quarter in current year (April 1, 2023, to June 30, 2023)
1. Information on sales and profit or loss by reporting segment(Millions of yen)Amountrecorded inquarterly
Adjustments
consolidated(Note 1, 2, 3)
financialstatements(Note 2)

Reporting segment
Information
Network
SolutionsElectronic
Devices

Total

Net sales
Net sales from externalcustomers
Intersegment net sales andtransfers
Total
Segment profit

20,445

7,683

28,128－28,128

6

32

39

(39)

－

20,452

7,715

28,168(39)

28,128

472

216

689

9

698

Notes:
1 Adjustments to segment profit (loss) are elimination of intersegment transactions.
2 Segment profit (loss) is adjusted with operating income (loss) in the quarterly consolidated income statements.

15