Financial Results for the 1Q
for the FY ending March 2025
July 30, 2024
NEC Networks & System Integration Corporation(TSE: 1973, NESIC)© NEC Networks & System Integration Corporation 2024

1Q FY2025/3 Summary
1Q
FY24/3

1Q
FY25/3

ChangeOrders received

96.5

97.5

+1%

Net sales

71.7

79.1

+10%

Gross proft

12.5

13.9

+1.4

(to sales)

17.5%

17.6%+0.1pt

SG&A

11.4

11.6

-0.1

Operating income

1.1

2.4

+1.3

(to sales)

1.6%

3.0%+1.4pt

Net income

0.2

1.5

+1.3

(to sales)

0.3%

1.9%+1.6pt

Free cash flows

18.5

18.8+0.4

Orders backlog

225.7

238.2+6%

attributable to owners of the parent1(¥ Bn.)

© NEC Networks & System Integration Corporation 2024

Sales and profits increased
substantially toward full-year target
Orders received:⚫ Increased making up for the reactional fall oflarge projects (-12)* of the previous FY(Growth rate excluding the reactive fall: +15%)✓ Driven by governments area such as firefighting
and disaster prevention* Equipment procurement, overseas construction-related

Net sales:⚫ Gov’t and enterprises (mainly manufacturing) areas
IncreasedOperating income:⚫ All segments increased

1Q FY2025/3 Operating Income Analysis

Business profitability is steadily improving(¥ Bn.)

Three business segments totalProfitabilityimprovement＋0.6
Sales increase
+0.6

1.1

(1.6％)Net sales+4.1

SG&A -0.1

2.4(3.0％)

GPM＋0.8ptNet sales+3.4(+5%)

1Q
FY24/32“Others” +0.2

© NEC Networks & System Integration Corporation 2024

GP：+1.4(GPM：+0.1pt)

1Q
FY25/3

Regarding Segment Figures
We made a business transfer between NWS and ESS (April 2024)(Maintenance for telecom. carriers, construction function for aerospace biz.)In this slides the segment figures of FY23/3 and FY24/3 were recalculated ones
for comparison.
Figures of each quarters are prepared athttps://www.nesic.co.jp/english/ir/library/2024.html

3© NEC Networks & System Integration Corporation 2024

1Q FY2025/3 Orders Received by Segment(¥ Bn.)

96.5
80.8
DXS

27.2

32.3

+19%

▐ DX Solutions (DXS)⚫ Expanded centering on strategic arias such asworkstyle DX and government DX▐ Network Solutions (NWS)
-3%
22.2

23.5

⚫ Though social infra. biz* expanded, telecom.
carrier biz and a manufacturing subsidiarydecreased*1: Space/national security, broadcasting

44.6

39.3

ESS

27.7

Others

2.7

1.8

3.8

1Q
FY23/3

1Q
FY24/3

1Q
FY25/3

4+1%

26.9
23.0

NWS

97.5

-12%

▐ Environmental & SocialSolutions(ESS)⚫ Domestic construction area including firefighting
and disaster prevention increased with reactive fallof large projects (-12)* of the previous FY* Growth rate excluding the reactive fall: +20%

※Segment
informationof FY23/3 & FY24/3 has been reclassified numbers to reflect an inter-segment business transfer (between NWS & ESS) in April 2024.
© NEC Networks & System Integration
Corporation2024

1Q FY2025/3 Net Sales by Segment(¥ Bn.)

79.1 +10%
67.6

30.5

DXS
24.7

NWSESSOthers

571.7
27.8

19.3
19.5

+10%

-8%

21.0

⚫ Strategic arias (workstyle DX, government DX,
next-gen network security) expanded▐ Network Solutions (NWS)⚫ Though a manufacturing subsidiary increased,
telecom. carrier biz and social infra. biz*decreased*1: Marine and space/national security(reactional fall)

22.5
21.3

20.2

2.1

2.7

6.8

1Q
FY23/31QFY24/31Q
FY25/3© NEC Networks & System Integration Corporation 2024

▐ DX Solutions (DXS)▐ Environmental & Social+11%Solutions(ESS)⚫ Domestic construction area such as highway
and disaster prevention increased

1Q FY2025/3 Operating Income by Segment
2.4(¥ Bn.)

1.5(2.2％)(3.0％)(+1.4pt)

3.1

+0.4

1.1

(1.6％)

DXS(10.1％)

2.3(9.2％)

ESS

0.1

Others/eliminations(0.5％)

1.4(6.8％)

-0.1
(-)

+0.3

(9.0％)(+2.2pt)

0.7

+0.8

(3.1％)-2.2-2.9

Both operating income and OPM
improved in all 3 segments▐ DX Solutions (DXS)⚫ Profit increased by sales growth▐ Network Solutions (NWS)

2.7

1.7

1.3(+0.4pt)(9.7％)

NWS(6.7％)+1.3-3.1(-pt)-0.2⚫ Profit increased due to improved GPM
despite decreased sales▐ Environmental & SocialSolutions(ESS)⚫ Profit increased by both sales expansion andGPM improvement▐ Others/elimination
1Q
FY23/361Q
FY24/3© NEC Networks & System Integration Corporation 2024

1Q
FY25/3⚫ Expenses for new mission-critical systems
increased1Q FY2025/3 GP Margin by Segment

71Q1Q

FY24/3

FY25/3DXS

21.6%

20.5%

-1.1pt

NWS

17.8%

20.4%

+2.6ptChangeESS

13.4%

15.4%

+2.0ptSub-total: 3 segments

18.0%

18.9%

+0.8ptCompany total

17.5%

17.6%

+0.1pt© NEC Networks & System Integration Corporation 2024

Key factors
・Though GPM during order acceptance and GPM of backlogs
improved, low margin projects including strategic products
business and resource relocation impacted
・Improved telecom carrier business (by business reform)
・A manufacturing subsidiary (ticket vender machine)
contributed
・Sales increase （lower fixed ratio)・Desreased low margin projects and higher efficiency

*Forecasts as at July 30, 2024

FY2025/3 Forecasts(¥ Bn.)

FY24/3

FY25/3Forecasts

ChangeOrders received

377.2

380

*Net sales

359.5365*

Operating income

25.1

29.0

+3.9

(to sales)(7.0%)(7.9%)+0.9pt

Net income

15.3

18.0+2.7(4.3%)(4.9%)+0.6ptattributable to owners of the parent(to sales)**Growth rate excluding product business in “Other” segment anda large product PJ for a government agency:
Orders +5%: Sales +4%
8© NEC Networks & System Integration Corporation 2024

+1%+2%

No change in forecasts
Accelerating our strategy execution
and improve profit growth toward
the annual target

*Forecasts as at July 30, 2024

FY2025/3 Forecasts by Segment (Base on Current Segment)（単位：億円）

377.2
DXS

NWS
ESS
Others

9YOY

YOY

380

Operating income

Net sales

Orders received
+1%

359.5

365+2%

25.1(7.0%)
132.8

90.7

145

88+9%-3%DXS

NWS

129.7

97.6

135

90+4%-8%

137

19.7

10

FY24/3

FY25/3e+2%© NEC Networks & System Integration Corporation 2024

ESS122.6130Others

9.5

10FY24/3

FY25/3e+6%29.0(7.9%) ＋3.919.0

DXSNWSESS
133.9

YOY( ): to Sales

Others/elimination

15.7(14.1%)＋3.3(12.1%)

10.5(10.8%)

11.5

10.5(11.7%)

14.5(9.3%)(11.2%)

-12.5

-15.0

FY24/3

FY25/3e-0.0＋3.0-2.5

Reclassified quarterly data and other data

Please see our supplementary data sheet for- Reclassified quarterly data for FY2023/3 & FY2024/3- Sales by business type, sales by market etc.
https://www.nesic.co.jp/english/ir/library/2024.html

10© NEC Networks & System Integration Corporation 2024

Cautionary Statement
Forecasts and targets of results mentioned in this document are future estimates and are thus
inclusive of risks and uncertain factors since they are not based on definite facts. Please be aware that avariety of factors could cause actual results to differ significantly from those projected. The major
factors affecting actual results include the economic climate and social trends surrounding the businessof this Company’s group, consumer trends vis-a-vis systems and services provided by this Company’sgroup, as well as pressure to lower prices and ability to cope with the market in response to intensifiedcompetition.
Factors affecting results are not limited to the ones mentioned above.
Some information for reference such as impact of special factors is calculated and shown in roundnumbers.
There was an inter-segment (between NWS and ESS) business transfer in April 2024. Segment
information for the FY 2023/3 and FY 2024/3 have been recalculated to reflect this change.

11© NEC Networks & System Integration Corporation 2024

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