Consolidated Financial Results for the Fiscal Year Ended March 31, 2024 (JGAAP)May 13, 2024
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, Director and Managing Executive Officer
Tel: +81-50-3684-7780
Scheduled date of general shareholders’ meeting:June 25, 2024
Scheduled date for dividend payment:
June 25, 2024
Scheduled date for filing consolidated financial statements:
June 6, 2024
Preparation of supplemental explanatory materials:
Yes
Results briefing to be held:
Yes (for institutional investors and securities analysts)
1. Consolidated financial results for the fiscal year ended March 31, 2024
(April 1, 2023, to March 31, 2024)(1) Consolidated operating results

Net sales

Millions of yen (rounded down), % figures are year-on-year change
Profit attributable toOperating income
Ordinary income
owners of parent

Year ended
124,856
0.8%
6,439
25.8%
6,486
21.1%
5,477
55.6%
March 31, 2024
Year ended
123,899
3.8%
5,118
27.6%
5,355
26.7%
3,521
25.8%
March 31, 2023
Note: Comprehensive income was 6,895 million yen (+132.5%) in year ended March 31, 2024; 2,965
million yen (+5.7%) in year ended March 31, 2023.
Earnings
per share(yen)

Dilutedearnings per
share (yen)Ratio of profit toshareholders’equityRatio ofordinary
income to total
assetsRatio ofoperatingincome tonet salesYear ended
304.75
—
14.5%
7.9%
5.2%
March 31, 2024
Year ended
197.48
—
10.4%
6.6%
4.1%
March 31, 2023
Reference: Equity in earnings affiliates in year ended March 31, 2024, nil; in year ended March 31, 2023,
nil.
(2) Consolidated financial position
Total assets
Net assets
Shareholders’
Net assets per(millions of yen)(millions of yen)equity ratio
share (yen)Year ended
81,06640,86449.8%
2,241.85
March 31, 2024
Year ended
83,20735,38742.0%
1,950.05
March 31, 2023
Reference: Shareholders’ equity in year ended March 31, 2024, 40,401 million yen; in year ended March
31, 2023, 34,945 million yen.

1(3) Consolidated cash flows
Millions of yen
Cash and cash
equivalents at endof yearCash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities

4,954

15,466(2,613)38,6844,263

39(2,612)

20,845

Year ended
March 31, 2024
Year ended
March 31, 2023

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

End ofsecondquarter

End ofthird
quarterYearend

Total

Total
annualdividend
payment(millionsof yen)Dividend
payoutratio(consolidated)

Ratio ofdividend
payout tonetassetsYear ended
—
25.00
—
36.00
61.00
1,137
30.9%
3.2%
March 31, 2023
Year ended
—
38.00
—
52.00
90.00
1,684
29.5%
4.3%
March 31, 2024
Year ended
—
45.00
—
46.00
91.00
40.0%
March 31, 2025
Note:
1. 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.
2. The dividend payout ratio for the fiscal year under review was 29.5%. For details of the expected

dividend for the year ended March 31, 2025 please refer to attachment page12“(5) Dividend policy
and dividends for the year under review and coming year“

3. Forecast of consolidated financial results for the fiscal year ending March 31, 2025
(April 1, 2024 to March 31, 2025)% 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

103,000 (17.5%)

6,250(2.9%)

6,250(3.7%)

4,100(25.1%)

Note: The Company manages earnings on an annual basis, so does not disclose first-half earnings
forecasts.

2

227.51

*Notes(1) Changes in significant subsidiaries (which affected the scope of consolidation) during the fiscal year:
Yes
Newly added ___ companies (names)
No longer consolidated 1 company (name) TSUZUKI EMBEDDED SOLUTIONS CO., LTD.
(2) 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:(3) Number of shares outstanding (common stock)
1. Number of shares outstanding at
Year ended
year end (including treasury
March 31, 2024
stock)

None
None
None
None

Year ended
March 31,
22,177,894
2023
Year ended
2. Number of shares at year end
Year ended
2,156,334
March 31,2,257,664(treasury stock)
March 31, 2024
2023
Year ended
3. Average number of shares overYear ended
17,973,054
March 31,
17,830,371
the period
March 31, 2024
2023
Note: The number of treasury shares includes those held in the Employee Stock Ownership Plan (ESOP)
trust account (0 in year ended March, 2024; 13,300 in year ended March 2023), Directors’ Compensation
Board Incentive Plan (BIP) trust account (420,447 in year ended March 2024; 290,547 in year ended
March 2023) and Stock-grant ESOP trust account (332,632 in year ended March 2024; 420,865 in year
ended March 2023).
20,177,894(Reference) Overview of Non-consolidated Financial Results
1.Non-consolidated financial results for the fiscal year ended March 31, 2024
(April 1, 2023, to March 31, 2024)(1)
Net salesYear ended
March 31, 2024
Year ended
March 31, 2023

85,990

4.1%

4,563

53.8

6,846

67.9% 16,967

435.6%

82,590(9.3%)

2,966

24.7

4,077

31.0%

38.9%

Earnings per share(yen)Year ended
March 31, 2024
Year ended
March 31, 2023

Millions of yen (rounded down), % figures are year-on-year change
Operating income
Ordinary income
ProfitDiluted earnings
per share (yen)944.06—

177.68

—

3

3,168

(2) Non-consolidated financial position
Total assets
Net assets
Shareholders’
Net assets per(millions of yen)(millions of yen)equity ratio
share (yen)Year ended
70,00738,78255.4%
2,151.98
March 31, 2024
Year ended
54,53922,33340.9%
1,246.27
March 31, 2023
Reference: Shareholders’ equity was 38,782 million yen in year ended March 31, 2024; 22,333 million
yen in year ended March 31, 2023.

*The financial information in this report is not subject to audit 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
not intended to be a promise that the Company will achieve. Actual results may vary materially fromforecasts due to a variety of factors.
(How to obtain supplementary explanatory materials for financial results and results briefing materials.)
The Company plans to hold a results briefing for institutional investors and analysts on Wednesday, May
22, 2024. The briefing materials distributed will be posted on the Company’s website promptly before thebriefing.

4

(Attachment)

Contents
1. Overview of results ............................................................................................................................. 6(1) Earnings ............................................................................................................................................. 6(2) Financial position ............................................................................................................................ 10(3) Cash flows ....................................................................................................................................... 10(4) Outlook ............................................................................................................................................. 11(5) Dividend policy and dividends for the year under review and coming year .......................... 12
2. Approach to selection of accounting standards ....................................................................... 12
3. Consolidated financial statements and notes ........................................................................... 13(1) Consolidated balance sheet ......................................................................................................... 13(2) Consolidated statements of income and comprehensive income .......................................... 16(3) Consolidated statement of changes in net assets..................................................................... 19(4) Consolidated statement of cash flows ........................................................................................ 21(5) Notes to consolidated financial statements ................................................................................ 23(Notes on premise of going concern) .......................................................................................... 23(Additional information) .................................................................................................................. 23(Segment and other information) ................................................................................................. 24(Per share information) .................................................................................................................. 29(Major subsequent events) ........................................................................................................... 29

5

1. Overview of results(1) Earnings
In the second half of the fiscal year ending March 2024, the Japanese economy showed signs of a
gradual recovery as economic and social activities began to return to normal. However, the risk of adownturn in overseas economies due to global monetary tightening and other factors exerted downward
pressure on Japan's economy. This, combined with the effects of rising prices, supply-side constraints,
and fluctuations in financial and capital markets, among other issues, rendered the outlook uncertain.
In the information and communications services industry, to which the Group belongs, companies'
appetite for investment remained strong, mainly for the maintenance and renewal of aging facilities, which
had been restrained by the pandemic. The trend of expanding ICT capital investment continued, including
the promotion of digital transformation (DX), which has become increasingly important in recent years. As
for the electronic device industry, while the supply-demand balance for semiconductors was moving
toward normalization, there was a slowdown in market growth due to uncertainty about the future,including a decline in personal consumption due to rising global prices and geopolitical risks associatedwith the prolonged Russia–Ukraine conflict.
Under these circumstances, the Group established a long-term vision spanning 10 years from thecurrent 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 tobe Growth Navigator, an organization that navigates growth and creates together with stakeholders,
including customers. We aim to be a company that continues to be chosen by customers as anorganization 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, the most 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. Based on this strategy,
the Company decided to transfer all shares of four Group companies engaged in business in theElectronic Devices segment to Restar Holdings Corporation on January 9, 2024. Going forward, we willconcentrate our management resources on the Information Network Solutions segment, which operates
in growth areas, to achieve sustainable growth and further enhancement of the Group’s corporate value.
In the fiscal year ended March 31, 2024, the first year of the current medium-term management plan, net
sales amounted to ¥124,856 million (up 0.8% year on year), operating income was ¥6,439 million (up25.8% year on year), ordinary income totaled ¥6,486 million (up 21.1% year on year), and profit
attributable to owners of parent was ¥5,477 million (up 55.6% year on year).
In the Information Network Solutions segment, orders declined year on year due to the falloff of large
projects in the equipment and service businesses. However, sales grew thanks to robust PC sales andnetwork construction projects, as well as contributions from expanded services in the “six growth areas,”
including cloud-based contact center and cloud communication areas. Profit hit a record high for thesecond fiscal year in a row. This rise was primarily due to the substantial sales growth and improved costof sales ratio attributed to thorough pricing and project management, partially offset by an increase in
SG&A expenses due to enhanced investment in human capital, such as personnel development, andexpenses for an in-house system overhaul.
In the Electronic Devices segment, the Company sold its shares in Tsuzuki Embedded Solutions Co.,
Ltd. and three other subsidiaries that were in charge of operating the segment to Restar Holdings
Corporation on January 9, 2024, excluding them from the scope of consolidation from the fourth quarterof the fiscal year under review. Orders came to ¥19,474 million (down 39.5% year on year), net sales
totaled ¥22,333 million (down 25.5% year on year), and operating income was ¥487 million (down 48.9%
year on year).

6

In the second quarter, for the purposes of effective utilization of management resources andimprovement of asset efficiency, the Company transferred fixed assets held by our company and aconsolidated subsidiary. As a result of this transfer, profit attributable to owners of parent increased
significantly year-on-year.
The following section discusses earnings by segment in the third quarter.
*Note regarding quarterly earnings for the Group
Many of the Group’s customers have business years from April through March of the following year.
Further, fulfilment obligations for many transactions are judged to be satisfied at a certain point, so theGroup’s sales and profit tend to be concentrated in September and March, the halfway and endpoints ofthe fiscal year.

7

Information Network Solutions
In the fiscal year ended March 31, 2024, orders were ¥94,560 million (down 7.7% year on year), net
sales totaled ¥102,523 million (up 9.2% year on year), and operating income was ¥5,925 million (up 42.6%
year on year). While orders declined compared to the previous fiscal year, net sales and operating income
grew year on year.
Results by business model
Equipment: Orders dropped year on year in reaction to an increase in large projects in the same periodof the previous year. Sales were affected by the same factor. However, the introduction of
PCs and network equipment has progressed for customers across a wide range of industries,
including public institutions, manufacturing, and logistics and retail sectors. As a result,orders were ¥38,051 million (down 15.6% year on year) and sales were ¥44,925 million (up18.4% year on year).
Development and construction: Orders fell year on year, due to a slight decline in large development andconstruction

projects compared with the same period of the previous fiscal year. Meanwhile,

sales benefited from growth in network and infrastructure construction projects as well as small
and medium-sized system development projects. As a result, orders were ¥13,599 million
Service:(down 3.1% year on year), and sales were ¥14,786 million (up 6.8% year on year).
Orders declined slightly due to the expiration of major operations service contracts for somecustomers in the first quarter of the fiscal year under review. However, sales were buoyed byincreased monthly service fees, including cloud usage fees, software maintenance fees, andequipment maintenance fees, backed by growth in the equipment and the development andconstruction businesses. Services in the “six growth areas,” including cloud-based contact
center services and cloud communication services, also expanded. As a result, orders were¥42,909 million (down 1.1% year on year), and sales were ¥42,811 million (up 1.6% year onyear).

Profit rose year on year. This rise was primarily due to the substantial sales growth, an improved cost of
sales ratio attributed to thorough pricing and project management, and an expansion of high-margin
services, including the “six growth areas,” partially offset by an increase in SG&A expenses due toenhanced investment in human capital, such as personnel development, and expenses for an in-housesystem overhaul.
Electronic Devices（Reiteration of the previous page）In the Electronic Devices segment, the Company sold its shares in
Tsuzuki Embedded Solutions Co., Ltd. and three other subsidiaries that were in charge of operating thesegment to Restar Holdings Corporation on January 9, 2024, excluding them from the scope of
consolidation from the fourth quarter of the fiscal year under review. Orders came to ¥19,474 million(down 39.5% year on year), net sales totaled ¥22,333 million (down 25.5% year on year), and operating
income was ¥487 million (down 48.9% year on year).

8

The following tables show sales and orders by segment for the fiscal year ending March, 2024.
Net sales (millions of yen)
Year ended
March 2023
Information Network Solutions
93,905Equipment
37,943Development and construction
13,840Service42,121
Electronic Devices
29,993
Total
123,899
Note: Inter-segment transactions are offset and eliminated.

Year ended March 2024
Versus previous year

102,523
44,925
14,78642,811
22,333
124,856

8,617
6,981
946
689
(7,660)957

109.2%
118.4%
106.8%
101.6%
74.5%
100.8%

Orders (millions of yen)
Year ended
March 2023
Information Network Solutions
102,490
Equipment
45,068Development and construction
14,039Service
43,382
Electronic Devices
32,198
Total
134,688
Note: Inter-segment transactions are offset and eliminated.

Year ended March 2024
Versus previous year

94,56038,051
13,59942,90919,474
114,035(7,929)(7,017)(439)(472)(12,723)(20,652)

92.3%
84.4%
96.9%
98.9%
60.5%
84.7%

Order backlog (millions of yen)
Year ended
March 2023

Year ended March 2024
Versus previous year

Information Network Solutions
25,85817,895(7,963)69.2%
Equipment
17,442
10,568(6,874)
60.6%
Development and construction
4,670
3,484
(1,186)74.6%
Service
3,744
3,842
97
102.6%
Electronic Devices——%
18,641(18,641)
Total
44,49917,895(26,604)40.2%
Note: 1.Inter-segment transactions are offset and eliminated.
2. In January 9, 2024, the company had transferred all of the outstanding shares in its consolidated
subsidiaries of the Electronic Devices business segment to the corporate group consisting of
Restar Holdings Corporation.

9

(2) Financial position
Assets totaled ¥81,066 million at the end of the year in review, down by ¥2,140 million from the end of
the previous year. The main factors of decrease were a ¥8,034 million decrease in inventories and a¥6,606 million decrease in accounts receivable and a ¥3,841 million decrease in electronically recordedmonetary claims and a ¥ 1,588 million decrease in Land, while the main factor of increase was a ¥17,818
million increase in cash and deposits.
Liabilities totaled ¥40,202 million at the end of the year, down by ¥7,618 million from the end of theprevious year. The main factors of the decrease were a ¥5,507 million decrease in notes and accounts
payable – trade and a ¥3,263 million decrease in net defined benefit liability.
Net assets totaled ¥40,864 million at the end of the year, up by ¥5,477 million from the end of theprevious year, and the shareholders’ equity ratio was 49.8% (42.0% at the end of the previous year). The
main factors of increase was profit attributable to owners of parent of ¥5,477 million, while the main factor
of decrease was a reduction in retained earnings of ¥1,379 million due to the payment of dividends fromsurplus.

(3) Cash flows
The Company recorded cash inflows of ¥4,954 million from operating activities, cash inflows of ¥15,466
million from investing activities, and cash outflows of ¥2,613 million from financing activities.
As a result, cash and cash equivalents increased by ¥17,839 million from the end of the previous year,
to ¥ 38,684 million. Cash flows and the main factors influencing them are as described below.
(Cash flows from operating activities)
Cash flows from operating activities came to ¥4,954 million (¥4,263 million in inflows in year ended
March 2023, a increase of 16.2%). Major cash inflows included income before income taxes and others of¥8,415 million, while major cash outflows included a ¥4,134 million decrease in net defined benefit liability
and assets.
Compared with the previous fiscal year, net cash inflow provided by operating activities increased ¥691
million. This mainly reflected a ¥6,521 million decrease in inventory assets (¥2,333 million yen decreasein the fiscal year under review versus a ¥4,188 million increase in the previous fiscal year), which offset a¥3,500 million decrease in net defined benefit liability and assets (¥4,134 million decrease in the fiscal
year under review versus a ¥633 million decline in the previous fiscal year) and a ¥1,854 million increase
gain on sale of non-current assets (none in the previous fiscal year).
(Cash flows from investing activities)
Cash flows from investing activities came to ¥15,466 million (¥39 million in inflows year ended March
2023). Major cash inflows included ¥8,542 million for proceeds from sale of shares of subsidiaries
resulting in change in scope of consolidation, ¥3,934 million for proceeds from sales of property, plant andequipment, and ¥3,006 million for proceeds from refund of loans.
Compared with the previous fiscal year, net cash inflow provided by investing activities increased¥15,426 million. This mainly reflected a ¥8,542 million increase for proceeds from sale of shares ofsubsidiaries resulting in change in scope of consolidation (none in the previous fiscal year), ¥3,668 million
increase for proceeds from sales of property, plant and equipment (¥266 million in inflows year ended
March 2023 versus ¥3,934 million in inflows year ended March 2024), and ¥3,002 million increase forproceeds from collection of loans (¥4 million in inflows year ended March 2023 versus ¥3,006 million in
inflows year ended March 2024).

10

(Cash flows from financing activities)
Cash flows from financing activities came to ¥2,613 million (¥2,612 million in year ended March 2023,
an increase of 0.0%). Major cash outflows included ¥1,379 million payments of dividends and ¥939
million repayments of finance lease liabilities.
Compared with the previous fiscal year, net cash outflow used in financing activities increased ¥0
million. The main reason for the increase was a ¥4,100 million decrease in inflows of long-termborrowings (¥0 million in the fiscal year under review versus ¥4,100 million in the previous fiscal year) anda ¥447 million increase in payments of dividends (¥1,379 million in the fiscal year under review versus a¥932 million in the previous fiscal year), which offset a ¥4,150 million decrease in cash outflows fromlong-term borrowings(¥4,291 million in outflows year ended March 2023 versus ¥140 million in outflows
year ended March 2024).

Reference: Cash flow related indicators
Year ended March

2021

2022

2023

Shareholders’ equity ratio (%)
40.6
41.5
42.0
Market value based shareholders’
38.2
33.7
33.1
equity ratio (%)
Interest bearing debt to cash flow
17.1
2.3
2.6
ratio (years)
Interest coverage ratio (x)
6.1
42.5
37.2
Notes: Shareholders’ equity ratio = Shareholders’ equity/total assets
Market value based shareholders’ equity ratio = Market capitalization/total assets
Interest bearing debt to cash flow ratio (years) = Interest bearing debt/cash flow
Interest coverage ratio = Cash flow/interest paid

2024
49.8
51.9
2.1
54.5

*All calculations are based on consolidated financial data.
*Market capitalization = fiscal year-end closing share price x number of shares outstanding at fiscal yearend (excluding treasury shares and company shares held in ESOP trust account, Directors’Compensation BIP trust account and Stock-grant ESOP trust account).
*Cash flow used in calculations is cash flow from operating activities.
*Interest bearing debt includes all liabilities on the consolidated balance sheets that incur interest.

(4) Outlook
Due to the sale of shares in four subsidiaries that operated the Electronic Devices segment on January 9,2024, the Company now has a single reportable segment, Information Network Solutions. We will steadily
work to “shift resources to growth areas,” a theme for the current medium-term management plan, to expand
the Information Network Solutions business and improve profitability with the aim of further enhancing
corporate value.
For the consolidated fiscal year ending March 31, 2025, we forecast net sales of ¥103,000 million (down
17.5% year on year), operating income of ¥6,250 million (down 2.9% year on year), ordinary income of¥6,250 million (down 3.7% year on year), and profit attributable to owners of parent of ¥4,100 million (down
25.1% year on year). We expect net sales to decline year on year due to the exclusion of the four
subsidiaries that operated the Electronic Devices segment from the scope of consolidation. Meanwhile, we
anticipate profit to stay on par with the level of the consolidated fiscal year ended March 31, 2024, owing
to measures to boost the “six growth areas” and efforts to bolster pricing management to improve theprofitability of existing businesses.
We will promptly announce any matters resulting from changes in the circumstances that require public

11

disclosure.

Net sales
Information Network Solutions
Electronic Devices

Operating income
Information Network Solutions
Electronic Devices
Adjustments

Operating margin
Information Network Solutions
Electronic Devices
Ordinary income
Ordinary profit margin

Profit attributable to owners of parent
Margin of profit attributable to owners of parent

FY03/24

FY03/25

results

forecast

124,856
102,523
22,333
6,439
5,925
487
27
5.2%
5.8%
2.2%
6,486
5.2%
5,477
4.4%

Change (YoY)

103,000
103,000(17.5%)
0.5%

—

—

6,250
6,250

(2.9%)
5.5%

—
—

—
—

6.1%
6.1%

0.9pt
0.3pt

—

—

6,250
6.1%
4,100
4.0%

(3.7%)
0.9pt(25.1%)(0.4pt)(5) Dividend policy and dividends for the year under review and coming year
The Company considers returning profits to shareholders as a management priority. Our basic policy is
to continuously distribute profits twice a year in the form of interim and year-end dividends based on ourbusiness performance, and to enhance corporate and shareholder value by effectively utilizing retained
earnings.
In the medium-term management plan that commenced in the fiscal year ended March 31, 2024, werevised the divided policy to pay dividends based on “a target consolidated payout ratio of 40% and aminimum DOE (dividend on equity) of 3.5%,” in accordance with a financial strategy that considers cost ofcapital, in the aim of fortifying shareholder returns. In this disclosure, the dividend payout ratio for the
fiscal year under review was 29.5%.It was because dividends are calculated using profit generated
through business activities, excluding extraordinary gains or losses.
For the fiscal year ended March 31, 2024, based on the above policy, we decided to pay a year-end
dividend per share of ¥52 (an annual dividend of ¥90, combined with an interim dividend of ¥38).
For the fiscal year ending March 31, 2025, we expect to pay an interim dividend per share of ¥45 and a
year-end dividend of ¥46, for an annual dividend of ¥91.

2. Approach to selection of accounting standards
The Group uses Japanese generally accepted accounting principles (JGAAP) to facilitate comparisonswith other Japanese companies in our sector.

123. Consolidated financial statements and notes(1) Consolidated balance sheet(Millions of yen)

AssetsCurrent assets
Cash and deposits
Notes
Accounts receivable – trade
Electronically recorded monetary claims
Contract assets
Inventories
Income taxes receivable
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
Retirement benefit asset
Deferred tax assets
Other
Allowance for doubtful accounts
Investments and other assets

13

As of March 31, 2023

As of March 31, 2024

20,877120
26,867
4,383
878
11,68314
2,377(5)67,196

38,696110
20,261
541
667
3,649
－
2,005
(2)
65,9292,122(1,003)
1,118
7
(6)
1
1,804
4,367
(3,260)
1,106
124
1,217
(868)
349
4,504

1,580
(706)
874
7
(6)
1
215
2,343
(1,634)
708
17
1,235
(865)
369
2,187

45
632
1,933
2,610

－
521
1,765
2,286

3,471
28
－
4,265
1,180
(49)
8,896

4,092
20
2,221
3,450
917
(39)
10,663

(Millions of yen)

Total noncurrent assets
Total assets

14

As of March 31, 2023

As of March 31, 2024

16,011
83,207

15,13781,066

(Millions of yen)

Liabilities
Current liabilities
Notes and accounts payable – trade
Contract liabilities
Short-term loans payable
Current portion of long-term loans payable
Lease obligations
Income taxes payable
Provision for bonuses
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

15

As of March 31, 2023

As of March 31, 2024

17,144
2,780
4,853
141
888
968
2,513
3,769
33,060

11,637
2,251
4,747
7
605
1,726
2,416
5,070
28,462

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

4,104
726
－
5,563
535
617
192
11,73940,2029,812
2,581
25,607(1,979)36,0229,812
2,756
29,705(2,043)40,230

1,132

1,944

2
193
(2,405)－－(1,773)(1,076)171441
35,387
83,207462
40,86481,066

(2) Consolidated statements of income and comprehensive income(Consolidated statement of income)(Millions of yen)
Fiscal year ended
March 31, 2023
Net sales
Cost of sales
Gross profit
Selling, general, and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Insurance income
Dividends income of insurance
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses
Loss on termination
Facility move out expenses
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sale of non-current assets
Gain on sales of investment securities
Gain on sale of shares of subsidiaries andassociates
Gain on sales of golf club membership
Gain on redemption of golf memberships
Total extraordinary income
Extraordinary loss
Loss on retirement of noncurrent assets
Loss on sales of investment securities
Loss on valuation of investment securities
Loss on termination of retirement benefit
plan
Loss on valuation of golf club membership
Total extraordinary losses
Income before income taxes and others
Income taxes – current
Income taxes – deferred
Total income taxes
ProfitProfit attributable to noncontrolling interests

16

Fiscal year ended
March 31, 2024

123,899
99,72024,17819,0605,118

124,856
99,54825,30818,868
6,439

5
98
42
73
56
93
370

11
90
3
10
27
61
203

114
－
－
18
133
5,355

90
17
34
14
157
6,486

－
423

1,854
545

－

39

－
－
423

0
4
2,443

172
3
22

455
－
－

－

57

－
198
5,579
1,545
299
1,844
3,734
213

1
514
8,415
2,923
(155)
2,768
5,647
170

(Millions of yen)
Fiscal year ended
March 31, 2023
Profit attributable to owners of parent

3,521

17

Fiscal year ended
March 31, 2024
5,477

(Consolidated statement of comprehensive income)(Millions of yen)
Fiscal year ended
March 31, 2023
ProfitOther 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 toowners of parent
Comprehensive income attributable tononcontrolling interests

18

Fiscal year ended
March 31, 2024

3,734

5,647

(211)

811

39
47
(645)
(769)
2,965

(2)
(193)
632
1,248
6,895

2,752

6,725

213

170

(3) Consolidated statement of changes in net assets
Fiscal year ended March 31, 2023
(Millions of yen)
Shareholders' equity
Retained
Shareholders'Capital surplus
Treasury stockearnings
equityCapital stock
Balance at beginningof fiscal year
Changes during theyear
Dividend fromsurplusProfit attributable toowners of parent
Purchase of treasury
stock
Disposal of treasurystock
Net changes of items
other thanshareholders’ equity
Total changes during
the year
Balance at end of the
year

9,812

2,581

23,018(2,257)33,155

(932)

(932)

3,521

3,521
(5)

(5)

283

283

－

－

2,588

278

2,867

9,812

2,581

25,607(1,979)36,022

Accumulated other comprehensive income

Balance at
beginning of fiscal
year
Changes during
year
Dividend of
surplus

Valuation
Deferreddifference
gains oron available
losses on
for salehedgessecurities

1,343

(37)

NonForeign
Remeasurements
Other
controllingcurrencyof defined benefit comprehensive interests
translation
plans
incomeadjustment

145(1,760)

(307)

352

3,521

Purchase oftreasury stock
Disposal oftreasury stock

Total changes
during year
Balance at end ofyear

33,199(932)

Profit attributable toowners of parent

Net changes of
items other thanshareholders’ equity

Total net
assets

(5)
283
(211)

39

47

(645)

(769)

89

(679)

(211)

39

47

(645)

(769)

89

2,187

1,132

2

193

(2,405)(1,076)441

35,387

19

Fiscal year ended March 31, 2024
(Millions of yen)

Balance at beginningof fiscal year
Changes during theyear
Dividend fromsurplusProfit attributable toowners of parent
Purchase of treasury
stock
Disposal of treasurystock
Net changes of items
other thanshareholders’ equity
Total changes during
the year
Balance at end of year

Shareholders' equity
Retained
Capital stock Capital surplus
Treasury stock Shareholders'earnings
equity
9,812

2,581

25,607(1,979)36,022(1,379)(1,379)

5,477

5,477

174

(275)

(275)

210

385

－

174

4,097

(64)

4,208

9,812

2,756

29,705(2,043)40,230

Accumulated other comprehensive income

Balance at
beginning of fiscal
year
Changes during
year
Dividend of
surplus

Valuation
Deferreddifference
gains oron available
losses on
for salehedgessecurities

1,132

2

NonForeign
Remeasurements
Other
controllingcurrencyof defined benefit comprehensive interests
translation
plans
incomeadjustment

193(2,405)(1,076)

441

5,477

Purchase oftreasury stock
Disposal oftreasury stock

Total changes
during year
Balance at end ofyear

35,387(1,379)Profit attributable toowners of parent

Net changes of
items other thanshareholders’ equity

Total net
assets

(275)
385
811

(2)

(193)

632

1,248

21

1,269

811

(2)

(193)

632

1,248

21

5,477

1,944

－

－

(1,773)171

462

40,86420

(4) Consolidated statement of cash flows(Millions of yen)
Fiscal year ended
March 31, 2023
Cash flows from operating activities
Income before income taxes and others
Depreciation and amortization
Goodwill amortization
Increase (decrease) in provision for doubtful
accounts
Increase (decrease) in provision for bonuses
Increase decrease in net defined benefit liability
and asset
Increase (decrease) in provision for shareawardsInterest and dividend income
Interest expenses
Loss (gain) on sale of non-current assets
Loss (gain) on sale of investment securities
Loss (gain) on valuation of investment securities
Gain on sale of shares of subsidiaries andassociates
Loss on disposal of noncurrent assets
Loss on termination of retirement benefit system
Other non-operating loss (gain)
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Decrease (increase) in other assets
Increase (decrease) in notes and accounts
payable – trade
Increase (decrease) in accrued consumption
taxes
Increase (decrease) in long-term accounts
payable - other
Increase (decrease) in other liabilities
SubtotalInterest and dividends received
Interest paid
Other
Income taxes paid
Refund of income taxes
Cash flows from operating activities

21

Fiscal year ended
March 31, 2024

5,579
2,124
90

8,415
1,576
45

(68)

(10)

209

(17)

(633)

(4,134)

7

(20)

(104)
114
－
(419)
22

(102)
90
(1,854)
(545)
－

－

(39)

172
－
(176)
587
(4,188)
(444)

455
57
(2)
(476)
2,333
(47)

1,817

(1,305)

113

935

－

506

1,144
5,947
104
(114)
176
(1,855)
4
4,263

1,025
6,885
102
(90)
2
(1,979)33
4,954

(Millions of yen)
Fiscal year ended
March 31, 2023
Cash flows from investing activities
Outflows from transfers to time deposits
Purchase of property, plant and equipment
Proceeds from sale of property, plant andequipment
Purchase of intangible assets
Proceeds from sale of intangible assets
Purchase of investment securities
Proceeds from sale of investment securities
Proceeds from sale of shares of subsidiaries
resulting in change in scope of consolidation
Proceeds from collection of loans receivable
Other
Cash flows from investing activities
Cash flows from financing activities
Net increase (decrease) in short-termborrowings
Proceeds from long-term borrowings
Repayment of long-term borrowings
Repayment of lease obligations
Acquisition of treasury stock
Proceeds from disposal of treasury stock
Dividend payments
Dividends paid to noncontrolling interests
Cash flows from financing activities
Effect of exchange rate changes on cash andcash equivalents
Net increase (decrease) in cash and cash
equivalents
Cash and cash equivalents at beginning of theperiodCash and cash equivalents at end of the period

22

Fiscal year ended
March 31, 2024

(0)
(283)

－
(424)

266

3,934

(807)
52
(24)
741

(522)
158
(162)
1,249

－

8,542

4
88
39

3,006
(317)
15,466

(323)

(114)

4,100
(4,291)(1,318)
(5)
283
(932)
(124)
(2,612)

－
(140)
(939)
(275)
385
(1,379)(149)(2,613)

24

31

1,714

17,83919,13020,845

20,84538,684

(5) Notes to consolidated financial statements(Notes on premise of going concern)
Not applicable.
(Additional information)
1 Transactions to deliver the Company’s shares to employees via a trust(Employee Stock Ownership Plan (ESOP) trust)
To provide benefits to its employees, the Company enters transactions to deliver its own shares to the
Employee Stock Ownership Plan via a trust. For accounting treatment of the relevant trust agreements,
the Company applies Practical Solution on Transactions of Delivering the Company’s Own Stock to
Employees etc. through Trusts (Practical Issues Task Force (PITF) No. 30, March 26, 2015). The
Company recognizes the difference on disposal when treasury shares are disposed of to the trust, andthe gains or losses on sales of shares sold by the trust to the ESOP, dividends from the Company on its
shares held by the trust, and trust-related expenses are recognized as liabilities.
(1) Overview of transactions
The Company has set up a trust whose beneficiaries are employees who are members of the ESOP
fulfilling certain conditions. Over a three-year period, the trust purchases the number of shares the ESOPis expected to purchase by third-party allocation, and subsequently, on a certain day every month, it sells
the shares to the ESOP. Upon termination of the trust, if there are trust earnings due to share priceappreciation, beneficiaries receive money in proportion to their contributions. If a loss on transfer arises
due to a decline in the share price and there are liabilities associated with trust assets, the Company will
reimburse the bank in a lump sum under guarantee provisions of the loan agreement. Therefore, there
will be no additional burden for employees.

This system has ended in May 2023.

(2) Company shares owned by the trust
The Company’s shares in the trust are recorded as treasury stock under net assets at the trust’s bookvalue (excluding incidental expenses). The book value of treasury stock and number of shares were ¥21
million yen and 13,300 respectively for the year ended March 2023.
(3) Book value of borrowings applying the gross value method¥133 million in the year ended March 2023.
2 Stock-grant schemes for directors, executive officers, and employees(Directors’ Compensation BIP trust and Stock-grant ESOP trust)
The Company has established a Directors’ Compensation Board Incentive Plan (BIP) trust for directors
and executive officers (excluding outside directors and nonresidents of Japan, “directors and others”
below). The purpose is to improve the Company’s medium to long-term earnings and corporate value,
and raise awareness of shareholder-oriented management.
It has also enhanced employee benefits with the establishment of a stock-grant ESOP trust for
employees. The purpose is to improve the Company’s medium- to long-term corporate value by raisingawareness of improvements in earnings and share price appreciation.
(1) Overview of transactions
The Directors’ Compensation BIP trust is a stock-based remuneration plan. The trust uses
remuneration of directors and others contributed by the Company as funds to acquire the Company’s
shares and provides directors and others with the shares and cash equivalent to the shares’ conversion
value.
The Stock-grant ESOP trust is an incentive plan. The trust acquires the Company’s shares and delivers
them to employees who fulfil certain conditions in accordance with the stock-grant rules.
(2) Company shares owned by the trusts
The Company’s shares in the trusts are recorded as treasury stock under net assets at the trusts’ bookvalue (excluding incidental expenses). The book value of treasury stock and number of shares held by23

the Directors’ Compensation BIP trust were ¥353 million and 290,547 respectively in the previous fiscal
year and ¥628 million and 420,447 in the year under review. The book value of treasury stock andnumber of shares held by the Stock-grant ESOP trust were ¥427 million and 420,865 respectively in theprevious fiscal year and ¥337 million and 332,632 in the year under review.

(Segment and other information)
Segment information
1. Overview of reporting segments
The Group’s reporting segments are the constituent units of the Group for which separate financial
statements are available, and are periodically reviewed by the Board of Directors to decide on the
allocation of business resources and evaluate performance.
The Group is engaged in information network systems business. The Company and its consolidated
subsidiaries operate businesses as independent management units. It has grouped its businesses into
two segments, Information Network Solutions and Electronic Devices, based on similarities in economic
characteristics such as the services and product line-up they provide to customers.
For the Electronic Devices segment, the Company sold its shares in Tsuzuki Embedded Solutions Co.,
Ltd. and three other subsidiaries that were in charge of operating the segment to Restar Holdings
Corporation on January 9, 2024. As a result of this sale, the four subsidiaries were excluded from thescope of consolidation from the fourth quarter of the fiscal year under review.
Segment businesses are as follows.
Information Network Solutions segment◆ Equipment: Sales of information and communication equipment◆ Development and construction: Provision of technical services in consulting, design, development,
and system construction◆ Service: Operation and maintenance of information and communication equipment and software, andprovision of monthly cloud and other subscription services
Electronic Devices segment◆ Provision of device solutions and contract design and development
2. Calculation of segment sales, profit or loss, assets, liabilities, and other items
The accounting treatment for the reporting segments is generally the same as that used when
preparing consolidated financial statements.
Operating income figures are used for reporting segment profit.
Intersegment net sales and transfers are based on third-party transaction prices.

24

3. Segment sales, profit or loss, assets, liabilities, and other items
Fiscal year ended March 2023
(Millions of yen)Amountrecorded in
Adjustments consolidated(Note 1, 2, 3)
financialstatements(Note 4)

Reporting segment
Information
Network
SolutionsElectronic
Devices

93,90529,993

123,899－

123,899

24

173

197

(197)

－

93,93030,166124,096(197)

123,899

Segment profit

4,155

954

5,109

8

5,118

Segment assets

64,71921,86086,579(3,372)

83,207

Segment liabilities

41,944

8,967

50,912(3,091)47,820

2,097

27

2,124

－

2,124

90

－

90

－

90

1,266

28

1,294

－

1,294

Total

Sales
Sales to externalcustomers
Intersegment sales andtransfers
Total

Other
Depreciation
Goodwill amortization
Increase in tangible andintangible fixed assets
Notes:

1 Adjustments to segment profit are elimination of intersegment transactions.
2 Adjustments to segment assets are elimination of intersegment transactions and assets related tooperating funds, long-term investment funds, and management divisions at submitting company.
3 Adjustments to segment liabilities are elimination of intersegment transactions.
4 Segment profit is adjusted with operating income in the consolidated income statements.

25

Fiscal year ended March 2024
(Millions of yen)Amountrecorded in
Adjustments consolidated(Note 1, 2, 3)
financialstatements(Note 4)

Reporting segment
Information
Network
SolutionsElectronic
Devices

102,523

22,333

124,856－

124,856

24

93

118

(118)

－

102,548

22,427

124,975(118)

124,856

Segment profit

5,925

487

6,412

27

6,439

Segment assets

81,066－

81,066－

81,066

Segment liabilities

40,202－40,202－40,202

1,557

18

1,576

－

1,576

45

－

45

－

45

945

2

947

－

947

Total

Sales
Sales to external customers
Intersegment sales andtransfers
Total

Other
Depreciation
Goodwill amortization
Increase in tangible andintangible fixed assets
Notes:

1 Adjustments to segment profit are elimination of intersegment transactions.
2 Segment profit is adjusted with operating income in the consolidated statement of income.

26

Related information
Fiscal year ended March 2023
1. Information by product and service
This is omitted because it is disclosed in the segment information.
2. Information by region(1) Net sales
This is omitted because net sales to external customers in Japan exceed 90% of the net sales in the
consolidated statement of income.
(2) Property, plant, and equipment
This is omitted because property, plant, and equipment located in Japan exceeds 90% of the property,
plant, and equipment on the consolidated balance sheet.
3. Information by major customer
This is omitted because none of the Company’s customers account for more than 10% of net sales in
the consolidated statement of income.

Fiscal year ended March 2024
1. Information by product and service
This is omitted because it is disclosed in the segment information.

2. Information by region(1) Net sales
This is omitted because net sales to external customers in Japan exceed 90% of the net sales in the
consolidated statement of income.
(2) Property, plant, and equipment
This is omitted because property, plant, and equipment located in Japan exceeds 90% of the property,
plant, and equipment on the consolidated balance sheet.

3. Information by major customer
This is omitted because none of the Company’s customers account for more than 10% of the net sales
in the consolidated statement of income.

Information on impairment loss on fixed assets by reportable segment
Previous fiscal year (April 1, 2022, to March 31, 2023)
Not applicable
Fiscal year under review (April 1, 2023, to March 31, 2024)
Not applicable27

Information on amortization of goodwill and unamortized balance by reportable segment
Fiscal year ended March 2023
(Millions of yen)
Reporting segment
Information
Network
Solutions

Adjustments

Electronic
Devices

Total

Total

Balance at end
45
45
45
－
－
of year
Note: Information on amortization of goodwill is omitted because the same information is disclosed in thesegment information.
Fiscal year ended March 2024
(Millions of yen)
Reporting segment
Information
Network
Solutions

Adjustments

Electronic
Devices

Total

Total
Information
Network
Solutions

Balance at end
－
－
－
－
－
of year
Note: Information on amortization of goodwill is omitted because the same information is disclosed in thesegment information.
Information on gain on negative goodwill by reportable segment
Previous fiscal year (April 1, 2022, to March 31, 2023)
Not applicable
Fiscal year under review (April 1, 2023, to March 31, 2024)
Not applicable28

(Per share information)
Fiscal year ended March 2023
Net assets per share (yen)Basic earnings per share (yen)Fiscal year ended March 2024

1,950.05
197.48

Net assets per share (yen)Basic earnings per share (yen)Note: Diluted earnings per share is not statedbecause there are no dilutive shares.

2,241.85
304.75

Note: Diluted earnings per share is not statedbecause there are no dilutive shares.

Notes:
1. Treasury shares held in the Employee Stock Ownership Plan (ESOP) trust account, Directors’Compensation BIP trust account, and Stock-grant ESOP trust account are deducted from thetotal number of shares outstanding at the end of the year for calculating net assets per share.
This comprised 13,300 shares held in the Employee Stock Ownership Plan (ESOP) trust
account in the year ended March 2023, and 0 shares in the year ended March 2024; 290,547
shares in the Directors' Compensation BIP trust account in the year ended March 2023 and420,447 shares in the year ended March 2024; and 420,865 shares held in the Stock-grant
ESOP trust account in the year ended March 2023 and 332,632 shares in the year ended
March 2024.
Treasury shares held in the Employee Stock Ownership Plan (ESOP) trust account, Directors’Compensation BIP trust account, and Stock-grant ESOP trust account are deducted in thecalculation of average number of shares outstanding during the year for calculating basic earnings
per share. This comprised 63,208 shares in the year ended March, 2023 and 1,608 shares in theyear ended March 2024 in the Employee Stock Ownership Plan (ESOP) trust account; 311,721
shares in the year ended March 2023 and 333,847 shares in the year ended March 2023 in the
Directors’ Compensation BIP trust account; and 439,727 shares in the year ended March 2023 and379,647 shares in the year ended March 2024 in the Stock-grant ESOP trust account.
2. The basis for calculation of basic earnings per share is as follows:
Fiscal year ended
March 2023
Profit attributable to owners of parent (millions ofyen)Amounts not attributable to ordinary shareholders(millions of yen)
Profit attributable to owners of parent (millions ofyen) related to common stock
Average number of shares (thousands)(Major subsequent events)
Not applicable.

29

Fiscal year ended
March 2024

3,521

5,477

－

－

3,521

5,477

17,83017,973