Note: This document is a translation of a part of the original Japanese version and provided for reference purposes only. In the event of any discrepancy
between the Japanese original and this English translation, the Japanese original shall prevail.

Consolidated Financial Results
for the Six Months Ended September 30, 2023
[Japanese GAAP]
November 7, 2023
Company name: Nippon Signal Co., Ltd.
Stock exchange listing: Tokyo
Code number: 6741
URL: https://www.signal.co.jp
Representative: Hidehiko Tsukamoto

President and CEO and COO

Contact: Hiromasa Fujimoto

General Manager, General Affairs Department

Phone: 03-3217-7200
Scheduled date of filing quarterly securities report:

November 8, 2023

Scheduled date of commencing dividend payments:
December 1, 2023
Availability of supplementary briefing material on quarterly financial results: Yes
Schedule of quarterly financial results briefing session:
Yes(Amounts of less than one million yen are rounded down)
1. Consolidated Financial Results for the Six Months Ended September 30, 2023 (April 1, 2023 to September 30, 2023)(1) Consolidated Operating Results(% indicates changes from the previous corresponding period.)
Profit attributable to
Net sales
Operating profit
Ordinary profit
owners of parent
Six months ended
Million yen%
Million yen%
Million yen%
Million yen%
September 30, 2023
34,194(2.5)
357(64.0)
1,105(34.0)
519(28.6)
(0.4)
16.7
1,673
1.3
727
(23.3)
September 30, 2022
35,054992(Note) Comprehensive income:Six months ended September 30, 2023:
Six months ended September 30, 2022:
Basic earnings
per share

Six months ended
September 30, 2023
September 30, 2022¥¥

2,000 million [139.2 %]836 million [98.7 %]Diluted earnings
per share

Yen

Yen

8.33
11.67

-

(2) Consolidated Financial Position
Total assets
As ofMillion yen
September 30, 2023
143,295
March 31, 2023
146,019(Reference) Equity: As of September 30, 2023:
As of March 31, 2023:

Net assets
Million yen¥¥

90,10389,351
90,103 million
89,351 million

Capital adequacy ratio
%

62.9
61.2

2. Dividends
Annual dividends
1stquarter-end
Fiscal year ended
March 31, 2023
Fiscal year ending
March 31, 2024

2ndquarter-end

3rdquarter-end

Year-end

Total

Yen

Yen

Yen

Yen

Yen

-

7.00

-

20.00

27.00

-

7.00
-

20.00

27.00

Fiscal year ending
March 31, 2024 (Forecast)(Note) Revision to the forecast for dividends announced most recently: None

3. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2024 (April 1, 2023 to March 31, 2024)(% indicates changes from the previous corresponding period.)
Profit attributable Basic earnings per
Net sales
Operating profit
Ordinary profit
to owners of parent
shareMillion yen%

Million yen%

Million yen%

Million yen%

Yen

95,000

11.2

6,000

17.4

6,800

14.9

4,700

15.3

75.36

Full year(Note) Revision to the financial results forecast announced most recently: None
* Notes:(1) Changes in significant subsidiaries during the period under review (changes in specified subsidiaries resulting in changes inscope of consolidation): No(2) Accounting methods adopted particularly for the preparation of quarterly consolidated financial statements: Yes(3) Changes in accounting policies, changes in accounting estimates and retrospective restatement
1) Changes in accounting policies due to the revision of accounting standards: No
2) Changes in accounting policies other than 1) above: No
3) Changes in accounting estimates: No4) Retrospective restatement: No(4) Total number of issued shares (common shares)
1) Total number of issued shares at the end of the period (including treasury shares):
As of September 30, 2023:

68,339,704 shares

As of March 31, 2023:

68,339,704 shares2) Total number of treasury shares at the end of the period:
As of September 30, 2023:
5,968,292 shares
As of March 31, 2023:

5,968,270 shares

3) Average number of shares during the period:
Six months ended September 30, 2023: 62,371,427 shares
Six months ended September 30, 2022: 62,371,603 shares*

These quarterly consolidated financial results reports are exempt from quarterly review conducted by certified public accountants oran audit corporation.

*

Proper use of earnings forecasts, and other special matters
The statements regarding forecast of financial results in this report are based on the information that is available to the Company, as
well as certain assumptions that are deemed to be reasonable by management. Therefore, there might be cases in which actual results
differ materially from forecast values due to various factors.
For the forecast of financial results, please refer to “1. Qualitative Information on Quarterly Financial Results, (3) Explanation ofConsolidated Financial Results Forecast and Other Forward-looking Information” on page 3 of the Attachments.

Table of Contents - Attachments
1. Qualitative Information on Quarterly Financial Results ...........................................2(1) Explanation of Operating Results ................................................................................ 2(2) Explanation of Financial Position ............................................................................... 3(3) Explanation of Consolidated Financial Results Forecast and Other
Forward-looking Information ...................................................................................... 3

2. Quarterly Consolidated Financial Statements and Principal Notes...........................4(1) Quarterly Consolidated Balance Sheets ...................................................................... 4(2) Quarterly Consolidated Statements of Income and Comprehensive Income ............... 6(3) Quarterly Consolidated Statements of Cash Flows...................................................... 8(4) Notes to Quarterly Consolidated Financial Statements ............................................... 9(Notes on going concern assumption) .......................................................................... 9(Notes in case of significant changes in shareholders’ equity) ..................................... 9(Accounting methods adopted particularly for the preparation ofquarterly consolidated financial statements)................................................................. 9(Segment information, etc.)........................................................................................ 10-1-

1. Qualitative Information on Quarterly Financial Results(1) Explanation of Operating Results
During the six months ended September 30, 2023 (April 1, 2023 to September 30, 2023), the global economy faced aprospect of stagnation in economic activity due to such factors as disruptions in energy and food markets caused by
Russia’s invasion of Ukraine and prolonged global monetary tightening to deal with rapid inflation.
The Japanese economy has not been able to dispel concerns about a downward outlook, as energy and raw material
prices remained high and consumers increasingly tended to save money due to rising prices of daily necessities.
Under these circumstances, the Group has continued to solve social issues in Japan and overseas by supporting theevolution of infrastructure with safe and comfortable solutions and promote adaptation to changes in the post-COVID19 business environment, based on the medium-term management plan “Next Stage 24” that began in FY2022.
The Company’s business results for the six months ended September 30, 2023 were 56,726 million yen in orders
received (down 10.4% year-on-year) and 34,194 million yen in net sales (down 2.5% year-on-year). Operating profit
was 357 million yen (down 64.0% year-on-year), ordinary profit was 1,105 million yen (down 34.0% year-on-year)
and profit attributable to owners of parent was 519 million yen (down 28.6% year-on-year).
An overview of the Company’s business by segment is as follows.
[Transportation Infrastructure]
In Railway Signal Systems, we received orders for and recorded sales of Automatic Train Control (ATC) systems,
interlocking devices, and other products from railroad operators in the Japanese market. We also engaged in businessactivities aimed at the realization of CBTC (Communication-Based Train Control system), which contributes mainly
to streamlining of facilities and efficient train operations. In the overseas market, such as in Taiwan and the Philippines,
we received orders for and recorded sales of Railway Signal Systems. In Taiwan, in particular, we have received anorder for a project to double track the single-track section of the Huadoing Line in order to enhance transport capacityin eastern Taiwan.
For Smart Mobility Systems, particularly Road Traffic Safety Systems, we received orders for and recorded sales oftraffic control systems, traffic signal lights, and other products. We also actively participated in various automated driving
demonstration projects, providing products and technologies that contribute to the “Vehicle-Infrastructure Cooperative
System” linking automated vehicles with traffic signals and roadside sensors.
As a result of the above, orders received were 27,680 million yen (down 34.5% year-on-year) and net sales were
17,094 million yen (down 10.8% year-on-year). Segment profit was 461 million yen (down 67.9% year-on-year).
[ICT Solutions]
In AFC, particularly Station Service Network Systems, we received orders for and recorded sales of platform screen
doors, ticket vending machines, and other products in the Japanese market. In addition, we have been developing
products and services that support the digitization of tickets and electronic payments as solutions for seamless travel.
In the overseas markets, especially in India and Bangladesh, we received orders for and recorded sales of AFC systems,
platform screen doors, and other products.
In R&S, which focuses on robotics and sensing, we received orders for and sales of security products and security
robots, especially 3D laser ranging image sensors to be installed in platform screen doors, construction and agriculturalequipment. Based on the basic concept of fail-safe, we are also promoting efforts to realize a future society in whichhumans and robots work together by integrating the latest robotics technologies with our core technologies, such as
sensors and image analysis, which we have cultivated through our past experience.
As a result of the above, orders received were 29,046 million yen (up 38.1% year-on-year) and net sales were17,099
million yen (up 7.6% year-on-year). Segment profit was 1,615 million yen (up 26.7% year-on-year).

-2-(2) Explanation of Financial Position(i) Assets, Liabilities and Net Assets
Total assets as of September 30, 2023 were 143,295 million yen, a decrease of 2,723 million yen from the end of theprevious fiscal year, mainly due to a 16,094 million yen decrease in notes and accounts receivable - trade, and contract
assets, despite a 9,408 million yen increase in inventories, a 2,014 million yen increase in cash and deposits, and a 1,577
million yen increase in investment securities due in part to a rise in fair value.
Liabilities decreased by 3,476 million yen from the end of the previous fiscal year to 53,191 million yen, mainly
due to a 3,815 million yen decrease in short-term borrowings and a 692 million yen decrease in income taxes payable,
despite a 1,164 million yen increase in electronically recorded obligations - operating.
Net assets were 90,103 million yen, an increase of 752 million yen from the end of the previous fiscal year, mainly
due to the recording of 1,525 million yen in valuation difference on available-for-sale securities and the recording of
519 million yen in profit attributable to owners of parent, despite a 1,247 million yen decrease in retained earnings from
dividends, etc.
(ii) Cash FlowsThe balance of cash and cash equivalents (“cash”) as of September 30, 2023 totaled 10,379 million yen, an increase of
2,014 million yen from the end of the previous fiscal year.
Cash flows in each area of activity during the six months ended September 30, 2023 are as follows.
(Cash flows from operating activities)
Net cash provided by operating activities was 7,582 million yen, compared with a cash inflow of 3,001 million yen in
the same period of the previous fiscal year. The principal cash inflow factor was a decrease in trade receivables, while
the principal cash outflow factor was an increase in inventories.
(Cash flows from investing activities)
Net cash used in investing activities was 579 million yen, compared with a cash outflow of 1,097 million yen in thesame period of the previous fiscal year. The principal cash outflow factor was the acquisition of property, plant andequipment and intangible assets, while the principal cash inflow factor was the sale of investment securities.
(Cash flow from financing activities)
Net cash used in financing activities was 5,011 million yen, compared with a cash outflow of 548 million yen in thesame period of the previous fiscal year. The principal cash outflow factors were repayment of short-term borrowingsand dividend payments.
(3) Explanation of Consolidated Financial Results Forecast and Other Forward-looking Information
There are no revisions to the full-year consolidated earnings forecast for the fiscal year ending March 31, 2024 (April
1, 2023 to March 31, 2024) announced on May 10, 2023.
Among the Group’s main businesses, Railway Signal Systems and Smart Mobility Systems in the Transportation
Infrastructure segment and AFC in the ICT Solutions segment tend to have a higher proportion of the Group’s sales atthe end of each fiscal year, as capital investment by domestic railroad operators, which are our major customers, andpublic investment by police and other entities are the main drivers.

-3-

2. Quarterly Consolidated Financial Statements and Principal Notes(1) Quarterly Consolidated Balance Sheets(Million yen)
As of March 31, 2023

As of September 30, 2023

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade, and contract
AssetsElectronically recorded monetary claims –operatingMerchandise and finished goods

8,407

10,421

63,97947,885

1,521

1,001

4,609

7,201

Work in process

9,819

15,063

Raw materials and supplies

5,684

7,256

Other
Allowance for doubtful accounts

3,282
(1)

4,358
(0)

Total current assets

97,302

93,186

Non-current assets
Property, plant and equipment
Buildings and structures, net

6,486

6,406

Machinery, equipment and vehicles, net

1,069

1,000

Tools, furniture and fixtures, net
Land

1,492

1,824

5,488

5,488

Leased assets, net
Construction in progress

77

71

1,696

1,695

Total property, plant and equipment

16,310

16,487

2,079

2,337

24,571

26,1492

2

Retirement benefit asset

2,476

2,529

Deferred tax assets

1,463

809

Other
Allowance for doubtful accounts

1,833
(20)

1,814
(20)

Total investments and other assets

30,326

31,283

Intangible assets
Investments and other assets
Investment securities
Long-term loans receivable

Total non-current assets
Total assets-4-48,71650,108146,019

143,295

(Million yen)
As of March 31, 2023

As of September 30, 2023

Liabilities
Current liabilities
Notes and accounts payable - trade

11,087

10,654

Electronically recorded obligations - operating

4,110

5,275

Short-term borrowings

17,515

13,700

Lease liabilities

7

7

Income taxes payable

1,489

796

Provision for bonuses

2,554

2,425

742

626

Provision for loss on orders received
Other

9,070

9,683

Total current liabilities

46,577

43,169

99

99

28

27

Non-current liabilities
Long-term deposits received
Long-term accounts payable - other
Lease liabilities

7

4

551

445

9,402
10,0909,444
10,022

56,66853,191

Share capital

10,00010,000Capital surplus

7,585

7,585

Retained earnings
Treasury shares

68,198(6,571)

67,470(6,571)

Total shareholders’ equity

79,21278,484

10,10011,62638
10,138(7)
11,61889,351

90,103146,019

143,295

Deferred tax liabilities
Retirement benefit liability
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets-5-(2) Quarterly Consolidated Statements of Income and Comprehensive Income
Six Months Ended September 30(Million yen)
For the six months ended
September 30, 2022

For the six months
ended September 30, 2023

Net sales

35,05434,194

Cost of sales

26,97526,854Gross profit

8,079

7,339

Selling, general and administrative expenses

7,086

6,982

992

357

Operating profit
Non-operating income
Interest income

00Dividend income
Dividend income of life insurance

273

345

155

189

Rental income from real estate

156

157

Nursing services income

7

8

Other

157

204

Total non-operating income

750

905

Interest expenses

16

21

Rental expenses on real estate

25

26

Taxes and dues

954

Nursing services expense

17

17

Other

1

37

Non-operating expenses

Total non-operating expenses
Ordinary profit

70

157

1,673

1,105

Extraordinary income
Gain on sale of non-current assets－

0Gain on sale of investment securities－

459

Total extraordinary income－

459

Loss on sale and retirement of non-current assets

10Loss on valuation of investment securities－

0

Loss on valuation of golf club membership15－

Total extraordinary losses

160Extraordinary losses

Profit before income taxes

1,656

1,563

Income taxes

928

1,044

Profit727

519(Details)
Profit attributable to owners of parent

727

519

-6-

(Million yen)
For the six months ended
September 30, 2022

For the six months
ended September 30, 2023

Other comprehensive income
Valuation difference on available-for-sale securities

121

Remeasurements of defined benefit plans, net of tax

(12)

1,525
(45)

Total other comprehensive income

108

1,480

836

2,000

836

2,000

Comprehensive income(Details)
Comprehensive income attributable to ownersof parent-7-(3) Quarterly Consolidated Statements of Cash Flows(Million yen)
For the six months
ended September 30, 2022

For the six months
ended September 30, 2023

Profit before income taxes

1,656

1,563

Depreciation
Loss (gain) on sale and retirement of non-current
assetsLoss (gain) on sale of investment securities

1,150

1,088

1

0

－

(459)

Interest and dividend income
Interest expenses

(273)

(345)

16

21

Cash flows from operating activities

Decrease (increase) in trade receivables
Decrease (increase) in inventories

9,707

16,614(5,352)(9,408)(2,109)

695

1,371

315

106

(7)

Other, net(2,979)(1,543)

Subtotal

3,295

8,535

Interest and dividends received

273

345

Interest paid

(16)

(21)

Income taxes paid

(666)

Income taxes refund

114
3,001

(1,286)
9

Increase (decrease) in trade payables
Increase (decrease) in contract liabilities
Increase (decrease) in retirement benefit liability

Net cash provided by (used in) operating activities

7,582

Cash flows from investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits

(38)
49

37

Purchase of property, plant and equipment
Purchase of intangible assets(750)(1,057)

(308)

(436)

(37)

Purchase of investment securities

(8)

(28)

Proceeds from sale of investment securities

－
(41)

1,218
(276)

(1,097)(579)

Net increase (decrease) in short-term borrowings

800(3,895)

Proceeds from deposits received from an affiliated company
Proceeds from deposits received from an unaffiliated entity

40

(10)

(100)

147

Repayments of lease liabilities

(44)

(3)

(1,244)(1,249)

(0)

(0)

(548)

(5,011)

60

22

1,416

2,014

Other, net
Net cash provided by (used in) investing activities
Cash flows from financing activities

Dividends paid
Decrease (increase) in treasury shares
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period

6,344

8,365

Cash and cash equivalents at end of period

7,761

10,379-8-

(4) Notes to Quarterly Consolidated Financial Statements(Notes on going concern assumption)
Not applicable(Notes in case of significant changes in shareholders’ equity)
Not applicable(Accounting methods adopted particularly for the preparation of quarterly consolidated financial statements)(Deferral of cost variances)
Cost variances arising from seasonally fluctuating operating rates are expected to be mostly eliminated by the endof the cost accounting period (end of the fiscal year or the second quarter of the fiscal year); therefore, such costvariances are deferred as current assets (other) or current liabilities (other) at the end of the first and third quartersof the fiscal year.
(Calculation of tax expenses)
Tax expenses are calculated by reasonably estimating the effective tax rate after applying tax effect accounting to
profit before income taxes for the consolidated fiscal year, including the second quarter of the fiscal year underreview, and multiplying income/loss before income taxes for the quarter by the estimated effective tax rate.

-9-

(Segment information, etc.)[Segment information]
I

For the six months ended September 30, 2022 (from April 1, 2022 to September 30, 2022)
Information on net sales and profit (loss) by reportable segment and classification of revenues(Millions of yen)
Quarterly
consolidated
statements ofincome andcomprehensive
income(Note 2)

Reportable segment
Adjustments(Note 1)

Transportation
Infrastructure

ICT Solutions

Net sales to external customers
Intersegment internal sales ortransfers

19,157

15,89735,054-35,054

-

-

-

-

-

Total
Goods or services transferred
at a point in time
Goods or services transferredover time
Total

19,157

15,89735,054-35,054

4,478

4,982

9,461

-

9,461

14,678

10,91425,593-25,593

19,157

15,89735,054-35,054

1,435

1,275

2,710

(1,717)

992

Total

Net sales

Segment profit

Notes: 1. Adjustments of (1,717) million yen in segment profit represent corporate expenses that are not allocated toreportable segments. Corporate expenses are primarily expenses of the administration divisions of the parent
company’s headquarters that are not attributable to any of the reportable segments.
2. Segment profit is adjusted with operating profit in the quarterly consolidated statements of income andcomprehensive income.

II For the six months ended September 30, 2023 (from April 1, 2023 to September 30, 2023)
Information on net sales and profit (loss) by reportable segment and classification of revenues(Millions of yen)
Quarterly
consolidated
statements ofincome andcomprehensive
income(Note 2)

Reportable segment
Adjustments(Note 1)

Transportation
Infrastructure

ICT Solutions

Net sales to external customers
Intersegment internal sales ortransfers

17,09417,09934,194-34,194

-

-

-

-

-

Total
Goods or services transferred
at a point in time
Goods or services transferredover time
Total

17,09417,09934,194-34,194

4,534

7,418

11,953-

11,953

12,5609,681

22,241-

22,241

17,09417,09934,194-34,194

461

1,615

2,077

(1,719)

357

Total

Net sales

Segment profit

Notes: 1. Adjustments of (1,719) million yen in segment profit represent corporate expenses that are not allocated toreportable segments. Corporate expenses are primarily expenses of the administration divisions of the parent
company’s headquarters that are not attributable to any of the reportable segments.
2. Segment profit is adjusted with operating profit in the quarterly consolidated statements of income andcomprehensive income.

- 10 -