NISSO CORPORATION【Main Q&A at the Financial Results Briefing for the First Nine Months of FY 3/2020(for Institutional Investors and Analysts)】
Held on February 10, 2020
The following content is not a record of the contents of all of the questions andanswers. In addition, some revisions and corrections have been made to make thecontent easier to understand.
Q1: Net sales has been downwardly revised for the current fiscal year. How
much of an impact was there from the electronic components andautomobiles industries?
A1: In NISSO's initial plan for the current fiscal year, although we expected theautomobiles industry to grow in the first half and the electronic components inthe second half, as a result, this did not happen, and net sales in the electroniccomponents industry decreased by 6% year-on-year. As an image, net sales inthe electronic components industry is about 10% lower than originally planned.
In addition, although we anticipated that the automobiles industry wouldcontinue on a certain trend toward the end of the fiscal year, it didn't grow asplanned, and the industry overall is slightly lower than as planned.
Q2: Although the dividend forecast for the current fiscal year has been left
unchanged at 25 yen per share, is the dividend payout ratio basically set
at 30%, or is it NISSO's plan to maintain 25 yen per share in the future?
A2: Although NISSO has set the dividend payout ratio of 30% or more as a standard,
we are aiming for a stable increase in dividends without being constrained bythis 30% ratio. At this time, we do not anticipate the dividends for the next
fiscal year to fall below the current forecast of 25 yen per share.
Q3: Please tell us about your sense of direction for the next fiscal year.
A3: In regard to the next fiscal year, we expect that trends will not be flat, butrather to increase to some extent. In addition, although we will take on new
approaches in preparation for the future, we believe that the effects of theseapproaches will only appear at some time still ahead.

Q4: Please tell us about the production technology domain stated on P10 of
the Financial Results Briefing Materials in more detail.
A4: At present, although the era has already begun where things that were once
made only by humans has switched to things being made mainly by machines,
if the utilization rates of these machines increase, productivity will also increase,which will result in profits. Although manufacturers have the production
technology personnel to increase this productivity, they tend to have a slightly
thinner layer of production technology capabilities with the increased use ofexternal labor. As such, after asking manufacturers if it was possible to conductbusiness with them in new domains if a company possesses production
technology capabilities, we were told that it would be possible. Since it wouldenable NISSO to further deepen our relationships with our clients, although it
may take time to develop human resources with such capabilities to promote
this production technology domain, based on the responses received, we areconsidering the production technology domain as a domain to strengthen forour medium- to long-term growth.
Q5: Please tell us if there has been any movement regarding the utilizationof foreign engineers.
A5: In the medium- to long-term, although NISSO expects that more softwarerelated human resources in Japan will come from Asian countries, we are stillin the market research stage, and we will gradually consider utilizing such
personnel from each Asian country.
Q6: With regard to the FY 3/2020 outlook, although net sales in the fourth
quarter is expected to be slightly lower than in the third quarter,operating profit is expected to be about the same. Will this be a result of
reduced costs? Please tell us about the content.
A6: With regard to the fourth quarter, we are analyzing the current situation indetail, and by looking at the balance with the back orders from our clients, weare proceeding so that there are no losses in recruitment costs. In addition, weare controlling SG&A expenses with an eye on the possible impact of the newcoronavirus.

Q7: It seems that NISSO is making upfront investments in personnel,
perhaps looking ahead to the next fiscal year. It is thought that if theoperations of electronic components companies increase in the next
fiscal year, the top line will increase, but if the rate of operation doesn't
return by the first quarter of the next fiscal year, please tell us yourthoughts on whether or not NISSO will continue to increase investmentsin these human resources.
A7: Currently, although we are actively investing in training/development,
recruitment, and appointment (of human resources) while monitoring thesituation of our clients, if the recovery period is delayed beyond ourexpectations, we will have no choice but to somewhat control such investments.
However, in addition to our Account Companies, since NISSO conducts businesswith other client companies that are potential "next" Account Company
candidates, we will continue to make investments and control them in order toobtain profits while devising assignments to such companies.