ANNUAL
REVIEW2019
Fiscal year ended
January 31, 2019

Aboutthe Ryoyo Group
Ryoyo Electro Corporation was founded in 1961 as a semiconductor trading company. Since then,the Company has continued to progress under its management philosophy of “Creating value intune with the times” while expanding its operations in tandem with the growth of the electronics
industry.
Today, as an electronics trading company with both a semiconductor and device business andan ICT and solutions business, the Ryoyo Group aims to be a driving force in generating new value
and emotion, connecting all of the parties whose support we enjoy.

VisionWe aim to be a Solution Partner
delivering a lasting impression
for our interconnected smart-society.
Action Policy

VALUE and PRIDE
SloganConnect Everything. With Technology. With Ideas.

The Underlying RYOYO SPIRIT

Change, Challenge, Speed

CONTENTS

01 About the Ryoyo Group

09 CSR Initiatives

02 Message from Management

11 Corporate Governance

03 Consolidated Financial

15 Financial Section

Highlights

04 To Our Shareholders

01

22	
Corporate Data /Investor Information

Notes on the Scope of This Annual Review
With respect to the contents of this annual review,“the Company” refers to Ryoyo Electro Corporation, while“the Ryoyo Group” refers to Ryoyo Electro Corporation andits consolidated subsidiaries Ryoyo Semicon Corporation,
Ryoyo Electro (Shanghai) Co., Ltd., Ryoyo Electro Hong
Kong Ltd., Ryoyo Electro Singapore Pte., Ltd. and Ryoyo
Electro India Pvt. Ltd.

Message from Management

Kenhachiro Ogawa

Moritaka Nakamura

Representative

Representative

Director & Chairman

Director & President

We would like to take this opportunity to thank all of our stakeholders for their ongoing support of the Ryoyo Group.
The Ryoyo Group strives to provide stakeholders with satis-

Under this plan, we will advance new initiatives in responseto changes in society while redefining the essence of our roleas an electronics trading company, at a time when people arefaction exceeding their expectations and to further provide

increasingly questioning the value of electronics trading com-unique and emotional added value in any era. We see thispanies. The plan’s strategic framework involves “restructuringtask as the very meaning for our existence.

trading functions,” “taking action to establish an ‘Only RYOYO’

Over the course of its long history, the Ryoyo Group haspresence,” and “upgrading business infrastructure.” By pro-accumulated a wealth of assets, including suppliers, clients,

viding emotion to customers, we will win out against theoperating bases, capital, and talented and dedicated humancompetition and, in turn, further increase the Group’s corpo-

resources. Going forward, it will be crucial for us to organicallyrate value.

merge these assets to create new value and emotion.
Looking back over the fiscal year ended January 31, 2019,

We look forward to the ongoing support of all our stakeholders as we tackle the challenges to come.

while the dissolution of distributorship contracts had a negative impact on sales, sales increased year on year because wewere able to incorporate demand related to artificial intelligence and deep learning while expanding businesses dealing
in products for PCs. Accordingly, we realized increases in bothoverall sales and profits for the first time in four years andwere able to start our three-year business plan, launched in
February 2019, in a good position.

Kenhachiro Ogawa

Moritaka Nakamura02

Consolidated Financial Highlights
Ryoyo Electro Corporation and Consolidated Subsidiaries
For the years ended January 31, 2019, 2018, 2017, 2016, and 2015

Thousands of
U.S. dollars*Millions of yen

2019.1

2018.12017.1

2016.1

2015.1

2019.1¥  93,799¥  92,234¥  98,417¥ 112,332¥ 110,107$860,866

Gross profit

8,925

7,591

8,099

7,852

8,801

81,915

Selling, general and administrative expenses

7,667

7,339

6,726

6,976

6,747

70,373Operating income

1,257

251

1,373

876

2,053

11,541

Profit attributable to owners of parent

1,020

212

822

743

1,683

9,364

Free cash flows

1,132(4,162)

6,874

4,392

467

10,393¥  75,948¥  78,111¥  77,973¥  76,865¥ 82,937$697,029

62,20864,40464,85963,921

65,583570,933

Net income¥   41.62¥    8.68¥   33.54¥   30.01¥   66.74$   0.38

Total net assets

2,531.90

2,625.66

2,644.10

2,591.70

2,595.83

23.23

Cash dividends

60.00

60.00

40.00

30.00

30.00

0.55

Gross profit margin

9.5

8.2

8.2

7.0

8.0

Operating margin

1.3

0.3

1.4

0.8

1.9

For the YearNet sales

At Year-End
Total assets
Total net assets
Per Share of Common Stock (Yen / U.S. dollars)

Ratios (%)

Net income margin

1.1

0.2

0.8

0.7

1.5

Equity ratio

81.7

82.4

83.1

83.1

79.0

Return on equity

1.6

0.3

1.3

1.1

2.6

Other Information
Number of shares issued **24,521,409 24,506,240 24,507,328 24,636,009 25,237,095

Number of employees

510

526

498

501

510

* U.S. dollar amounts have been translated from yen, for convenience only, at the rate of ¥108.96 = U.S.$1.00, the exchange rate prevailing on January 31, 2019.
** Number of shares issued does not include treasury stock.
Notes: 1. The consolidated financial highlights are is a translation of the Japanese financial statements. The Japanese version will be used for matters of a legal nature.
2. Unless otherwise noted, figures are rounded down to the nearest million.

Net Sales

Free Cash Flows

Total Assets / Total Net Assets

Millions of yen

Millions of yen

Millions of yen

6,874

110,107 112,332
98,417

92,234

93,7994,392
82,9371,132

76,86565,583

77,97363,921

78,11164,85975,94864,40462,208467(4,162)

15.1

16.1

17.1

18.1

19.1

15.1

16.1

17.1

18.1

19.1

15.1

16.1

Total Assets

03

17.1

18.1

Total Net Assets

19.1

To Our Shareholders

Moritaka Nakamura
Representative
Director & President“We will pursue reforms througha collaborative effort encompassing
all of our employees, thereby writing
the next chapter in our history.”04

To Our Shareholders

Proceeding to the Next Stage as “Team RYOYO”
In April 2018, when I became president and chief operatingof the business, such as by transitioning to a business unit

officer of Ryoyo Electro Corporation, I put forth a corporate

structure and revising business processes, I have worked toslogan, “Connect Everything. With Technology. With Ideas.”change the mind-set of Ryoyo Group employees by consis-

Going forward, the extent to which we can demonstrate thetently sharing information on the Group’s current situation andvalue of our existence will be crucially important for the Group.

vision. These efforts have been based on my conviction that if

Our corporate slogan expresses our desire to generate value

employees can work together as a team, the Group’s wealthby connecting all of our products and services, and creatingof assets can be used to create new value. We will pursue

a variety of links with customers and suppliers, as well as toreforms through a collaborative effort encompassing all of our

promote cooperation between employees in every aspect of

employees, thereby writing the next chapter in our history.

their work. In addition to improving the organizational structure

Three-Year Business Plan
We commenced a new three-year business plan in February

out against the competition and, in turn, further increase the2019, which we are now enacting. This business plan’s strate-

Group’s corporate value. To that end, we aim to reshape thegic framework involves “restructuring trading functions,”

Group as a high-value-added business and achieve net sales“challenge to ‘Only RYOYO,’” and “enhancing business infra-of ¥110.0 billion and operating income of ¥3.0 billion in the

structure.” By providing emotion to customers, we will win

fiscal year ending January 31, 2022, the final year of the plan.

Three-Year Business Plan (February 2019 – January 2022)
Restructuring

Challenge toEnhancing BusinessTrading Functions“Only RYOYO”

Infrastructure

Net Sales / Operating Income
Millions of yen+17.3%

110,000

93,79992,234

Challenge to “Only RYOYO”

3,000

Restructuring Trading Functions
1,257

251

18.1
Net Sales

05

Operating Income

19.1

22.1
(Target)1. Restructuring Trading Functions
Two of the Ryoyo Group’s strengths lie in having a businessthey want. At the same time, we will maximize our existingmodel comprising in equal parts a semiconductor and device

customers by further determining and catering to their respec-

business and an ICT and solutions business, and its abun-tive needs. Moreover, we are moving forward with thedance of clients. However, we are currently failing todevelopment of new products and the expansion of our client

sufficiently leverage these strengths; therefore, I believe thatbase and area of business operations, in accordance with thethe restructuring of trading functions is essential to achieving

needs of our clients. For example, in March 2019 we estab-future growth. Accordingly, we will once again embrace thelished Ryoyo Electro Europe GmbH in Germany as a footholdbasics of trading that are expected of a trading company:

for developing business in Europe. Furthermore, we are also

namely, understanding clients and delivering what they want,advancing investigations into establishing operating bases inwhen they want it, in an amount, of a quality, and at a priceNorth America.

Framework for Restructuring Trading Functions
Existing Products

New Products

Existing Customers

Maximize business opportunities through deeper understanding of client needs

New Customers

Accelerate acquisition of commercial rights
Expand business area by establishing overseas
operating bases

Source new products from Europe, China,
and elsewhere—

2. Challenge to “Only RYOYO”
We will “challenge to ‘Only RYOYO’” in order to dramaticallyAn initial example of this undertaking is our development oftransform our income structure. “Challenge to ‘Only RYOYO’”voice recognition technology, work upon which started in

involves taking action to establish a distinctly Ryoyo presence.

2018. This technology, which we have been working on since

We will strive to provide value that is unique to the Group by

2018, has enabled the Group to obtain a patent for the firstbuilding upon our technological resources and stepping up ourtime in its history. Discussions toward the practical application

investment in research and development to create originalof this technology are currently underway.

technologies and products while widening the range of our

To give our strengths a clear form, we will promote theofferings that combine existing products with new ones.

creation of “Only RYOYO” by turning subsequent ideas into
concrete projects while also looking into the possibility ofmergers and acquisitions and partnerships.

Purchase(Procurement)
Marketresearch
Customerneeds

Competitors
Sell(Sales)Create(Development)

Customers

Make(Production)

Strengthen functions

06

To Our Shareholders

3. Enhancing Business Infrastructure
We are making efforts to upgrade business infrastructure as

businesses in February 2019 to form a solutions business divi-a foundation for “restructuring trading functions” andsion, sharing and mobilizing a variety of resources, and refining“challenge to ‘Only RYOYO.’”the strengths that arise from being able to provide everything

In our business—which involves a seamless process fromfrom devices to clouds and applications.
At the same time, we will maximize marketing productivity

making proposals to customers to providing after sales followup—speed is of the utmost importance. Interdepartmental

and unite to create structures for increasing corporate value.

coordination and the sharing of information have been encour-

We will do this by improving the IT infrastructure that supports

aged and we have expedited the basic operation cycle throughour business operations, developing a human resource system

the establishment of a support structure integrating Japanese

to facilitate working styles that respond to social changes, andand overseas operations, which followed the shift to a busi-

enhancing our corporate governance structure to guarantee

ness unit structure in March 2018. Moreover, we will further

the soundness and transparency of management.

enhance our competitiveness by merging our ICT and IoT
Basic Operation Cycle

FailureClarification of the reason
Design Win
Opportunity

ClientProposal

Next proposal

After sales
follow-up

Quotation

Unofficial
order

Forecast

Order
receipt

Expedited operation
through BUs

Delivery

Shipment

Orderplacement

Follow-up
deliveryschedule

Supplier

Creditprovision

Incoming
inventoryPricenegotiation
Complaint
processing

Feedback from
customer

Future needs

07

Feedback

Cooperation and Sharing of Information

Feedback fromsupplier

Future needs

Making the Fiscal Year Ending January 31, 2020a Second Consecutive Year of Increased Sales and Profits
We expect to see expansion in both our semiconductor anddevice business and ICT and solutions business due to further
progress in the trend toward the practical application of artificial intelligence and IoT technologies and to an increase indemand associated with infrastructure- and security-related
projects pertaining to the Olympic and Paralympic GamesTokyo 2020. We anticipate this expansion despite recent concerns about both the impacts of trade friction between the
U.S. and China and the future outlook of these economies.
Furthermore, we aim to heighten sales and profits by generating an increase in the gross profit margin that will offset a risein “proactive costs,” such as those resulting from investment
in research and development and business infrastructure.
We position the fiscal year ending January 31, 2020 to be an
exceptionally important year in our three-year business plan.
I believe that increasing sales and profits for a second consecutive year while conducting investment for future growth willbe the first step in transforming the Ryoyo Group into a highvalue-added business.
(Millions of yen)
18.1

19.1

20.1 (Plan)

YoY

Net Sales

92,234

93,79998,000+4.5%

Gross profit

7,591

8,925

9,600

+7.6%

SG&A expenses

7,339

7,667

8,100

+5.6%

Operating income

251

1,257

1,500

+19.3%

Ordinary income

432

1,474

1,600

+8.5%

Profit attributable to owners of parent

212

1,020

1,140

+11.7%The Ryoyo Group Supports the T.League
To indicate its support for the philosophy of the T.League, which aims to become the world’s No.1 table
tennis league, the Group has signed a contract with the organizing body of the league to be an official
sponsor. In this capacity, we will help promote the sport of table tennis by supporting the T.League andits players.

08

CSR Initiatives

Realizing Society 5.0
Society 5.0, a vision for a future society to which Japan should aspire, follows the hunting and gathering society (Society 1.0),
agricultural society (Society 2.0), industrial society (Society 3.0), and information society (Society 4.0). In Society 5.0, all people
and things will be connected by the Internet of Things (IoT), and we will aim to drive economic development and resolve social
issues by creating unprecedented new value. This process will consequently contribute to achieving the United Nations Sustainable Development Goals.
The Ryoyo Group’s business domains encompass the ­technologies and factors that will facilitate such a society. We believe
that, through our business, we have an opportunity to contribute to the realization of Society 5.0.

Society 5.0 for the SDGs​
FinTechHealthTech
MediaTech

InsTechBig data
IoT

etc.

AdTechRyoyo Group​

MR

RetailTech

HomeTech

InsurTech

RETechAI
TourTech

Semiconductors
・
DevicesAR

EneTechICT・
Solutions​VR

InfraTech

Robot

SensorCloud

UrbanTech
DPTechConTechEdTechMobileEdge

AutoTechSportsTech
FashionTech

TransTechContributing to Peace of Mind and Safety—Zenkoji Temple in Nagano prefecture
Zenkoji Temple in Nagano prefecture, is a historic Buddhist temple which contains many historic buildings such as Main Hall
(Hondo), National Treasure, Sanmon Gate and Buddhist library, designated as a nationally important cultural properties, so many
worshippers visit from home and abroad as a popular tourist destination.
With increased attention, Zenkoji Temple has trouble with prank and graffiti on the wall of National­Treasure and nationally important cultural properties. That’s why considering to increase security cameras
taking severe measures against troubles.
With consideration to install security cameras, there is difficulty of fix wire-line cables which damage
the Zenkoji precious historic landscape. However wireless communication network provided by the Ryoyo Group creates wide area communication
environment, and achieves installation of security cameras in Niomon Gate
300 meters away from Main Hall.
At the Group, we hope that the installation of these security cameras will
help realize a safe and stress-free environment for worshippers to enjoy. We
also hope to continue contributing to people’s safety and peace of mind
through the ongoing provision of ICT and IoT technologies.

09

Human Resource Strategy
Realizing Employees’ Potential
The Group believes that, to advance the three-year business plan and, beyond that, achieve sustainable growth, human resources
are an important foundation and source for increasing corporate value.
We are developing systems such as human resource and education programs as well as an environment that enables employees
to adopt flexible workstyles in response to changes in the social environment, so that each and every employee can improvetheir skills and advance their careers, with a healthy, competitive spirit.
Moreover, to enable employees to be as productive as possible, it is necessary for a diversity of knowledge, experience, andabilities to be reflected in their work and roles. Accordingly, we are actively promoting the advancement of women and enhancing measures for cultivating global human resources to facilitate the diversification of human resources, while promoting ateam-based mentality.

Diversifying Human Resources
As the declining birth rate and aging population greatly transform the labor market in Japan, the active promotion of women isessential to sustaining healthy growth. Currently, women account for around 20% of the total number of the Group’s employees;
however, we are making efforts to increase the number of women in management positions and to promote the career development of women.
Date / Time period

Number of employees / Ratio / Number of years（Non-consolidated)

Number of employees

January 31, 2019

478

Number of female employees

January 31, 2019106

Ratio of female employees to total employees

January 31, 201922.2%

Average length of service by female employees

January 31, 2019

9.8 years

Ratio of women hired

Average for previous 3 years

28.3%

Ratio of female employees taking childcare leave

Average for previous 3 years

100%

Coordination between human resources in Japan and overseas is an
important theme in doing business globally. In March 2018, we switched
to a system of business units and constructed a comprehensive organizational structure integrating Japanese and overseas business units,
which have helped make it easier to share information and facilitate operations. Moreover, we are moving forward with initiatives to cultivate
human resources who can flourish on the global stage. For example, weare enhancing the skills and communication levels of locally hired staff working overseas by providing both training and opportunities for exchanges to Japan.
We made the cultivation of human resources one of the main themes of the medium-term management plan beginning in thefiscal year ending January 31, 2020. While respecting each employee’s strengths and individuality in their roles, we plan torestructure and enhance our education and training programs with the aim of creating a cycle in which everyone learns, grows,
and thrives.

10Corporate Governance
Board of Directors, Audit & Supervisory Board, and Corporate Officers
As of April 25, 2019

Kenhachiro Ogawa

Moritaka Nakamura

Kiyoshi Waki

Masaaki Tanabe

Yoshitsugu Tamakoshi

Representative
Director & Chairman

Representative
Director & President

Director

Director

Director

Yasushi Okazaki

Seiju Yasuda

Yoshiharu Hayakawa

Masumi Shiraishi

Director

Director

Outside Director(Independent Director)

Outside Director(Independent Director)

Audit & Supervisory Board
MemberOutside Audit & Supervisory
Board Members

Managing Executive Officer

Senior Executive Officers

Executive Officers

Yutaka Horikiri

Ryoji Kimura
Tsutomu Nobechi
Kazumi Akiyama

Kiyoshi Waki

Masaaki Tanabe
Yoshitsugu Tamakoshi
Yasushi Okazaki
Seiju Yasuda

Hideki Suzuki
Atuyuki Ohashi
Mitsuru Tsukuba
Mitsuhiro Takeishi
Osamu Sano

Basic Corporate Governance Philosophy

Directors and Board of Directors

At the Company, we recognize enhancing corporate gover-

The Board of Directors, which consists of nine directors (as ofnance as an important task for management. Therefore, in

April 25, 2019), of whom two are outside directors, is respon-order to continue to guarantee the soundness, transparency,

sible for making decisions as stipulated in laws, regulations,and effectiveness of management, as well as to increase

and the articles of incorporation; making important manage-

corporate value and fulfill our responsibilities to society, we

ment decisions; and overseeing the execution of operations.

are striving to develop internal systems that ensure the functionality of corporate governance.

met a total of 12 times during the year under review.

Company Organizations

Audit & Supervisory Board Members andAudit & Supervisory Board

Outline of the Corporate Governance Framework

11

In principle, the Board of Directors meets once a month andOrganizational format

Company with Audit & Supervisory Board

Chairman of the Board of Directors

Chairman

Number of directors

9 (including 2 outside directors)

Number of Audit & Supervisory Board
Members

4 (including 3 outside Audit & Supervisory
Board Members)

Independent officers

2 outside directors and 3 outside Audit &Supervisory Board Members

The Company is a Company with an Audit & Supervisory
Board as defined by the Companies Act of Japan, whereby
Audit & Supervisory Board Members act independently of
directors and oversee directors’ execution of operations.
The Audit & Supervisory Board consists of four Audit &Supervisory Board Members (as of April 25, 2019), of whom

Number of Board of Directors’ meetings
held during the fiscal year ended
12
January 31, 2019

three are outside Audit & Supervisory Board Members.

Number of Audit & Supervisory Board
meetings held during the fiscal year
ended January 31, 201912

month and met a total of 12 times during the year under review.

Voluntarily established advisorycommittees to the Board of Directors

Nomination and Compensation Committee

In principle, the Audit & Supervisory Board meets once a

Policy for Appointment of Independent Directors

independence, objectivity, and accountability of the Board of

The Company’s basic policy is to appoint two or more inde-

Directors’ functions related to the nomination and compensa-

pendent directors, and the Company currently has twotion of directors and executive officers. The Nomination andindependent directors (as of April 25, 2019). These directors

Compensation Committee deliberates on the basic policies

are selected based on the Company’s own criteria for judging

and proposals for the appointment and dismissal of directors

independence in order to ensure that they are able to effec-

and executive officers, as well as on the basic policies andtively fulfill their role and responsibilities in facilitating thecompensation amounts related to decisions on compensation,

ongoing growth of the Company and the medium-to-long-and reports the results to the Board of Directors.

term improvement of its corporate value.

Furthermore, there is a requirement for the Nomination andCompensation Committee to consist of three or more direc-

Nomination and Compensation Committee

tors, half or more of whom are outside directors. As of April

The Company has established a Nomination and Compensa-

25, 2019, the Committee consists of four directors, of whomtion Committee as an advisory body to the Board of Directors

two are outside directors. One of the outside directors serves

to further enhance corporate governance by strengthening theas the Committee chairman.

Directors
Directors

Reason for appointment

Kenhachiro Ogawa

Kenhachiro Ogawa has been involved in the management of the Company for many years, possesses broad insight into the overallmanagement of electronics trading companies, and has demonstrated strong leadership.

Moritaka Nakamura

Moritaka Nakamura possesses wide-ranging experience, broad insight, and an extensive network of corporate relationships. Sinceassuming his role as the Company’s president, he has continued to utilize that experience while demonstrating strong leadership inadvancing management reforms. For these reasons, the Company believes that he is capable of contributing to the improvement of
the Company’s corporate value.

Kiyoshi Waki

Kiyoshi Waki has cultivated a wealth of expertise in Japan and overseas through his experience working for a financial institution.
Since joining the Company, he has gained management experience through positions in the Corporate Strategy Division, theOverseas Marketing Division, and the Administration Division. He also possesses highly specialized knowledge and broad insight
into accounting and finance.

Masaaki Tanabe

Masaaki Tanabe has many years of management experience in the ICT and solutions business and possesses extensive experienceand broad insight into the Company’s business.

Yoshitsugu Tamakoshi

Yoshitsugu Tamakoshi has many years of experience in the semiconductor and device businesses of Mitsubishi Electric Corporationand the Company, and he thus possesses extensive expertise and broad insight into this business area.

Yasushi Okazaki

Yasushi Okazaki has experience of frontline business operations in Japan and overseas gained in his previous positions, primarily in
IT, and of working in internal auditing. In addition, he has been involved in the management of the Company’s IoT and solutions
businesses and possesses a wealth of experience and broad insight into these businesses.

Seiju Yasuda

Seiju Yasuda possesses extensive experience and broad insight into the Company’s business. He has many years of wide-ranging
experience in the Company’s semiconductor and device business and ICT and solutions business as well as experience of a varietyof positions at head office and other operating locations.

Audit & Supervisory Board Member
Audit & Supervisory Board
MemberReason for appointment

Yutaka Horikiri

Yutaka Horikiri has accumulated accounting and management experience through his years of service in the Company’s Administration Division and Corporate Strategy Division and possesses extensive insight related to finance and accounting.

Outside Directors
Attendance at meetingsof the Board of Directors

Outside directors

Reason for appointment

Yoshiharu Hayakawa

Yoshiharu Hayakawa possesses expert knowledge as a certified public accountant as well as extensive experience and broad insight as a management consultant. For these reasons, the Company
believes that he is suited to help strengthen the corporate governance system and improve the corporate value of the Company.

12/12

Masumi Shiraishi

Masumi Shiraishi possesses broad expertise in economic and social matters gained through her considerable experience in the private, public, and academic sectors. The Company believes that she iscapable of giving advice from a variety of viewpoints to help improve the Company’s corporate value.

—

12

Corporate GovernanceOutside Audit & Supervisory Board Members
Attendance at meetings

Outside Audit &Supervisory Board Members

Reason for appointment

Ryoji Kimura

Ryoji Kimura possesses specialized insight into all areas of corporate legal affairs based on his longcareer as an attorney and his related scholarly knowledge and experience.

12/12

12/12

Tsutomu Nobechi

Tsutomu Nobechi possesses considerable insight into financial and accounting matters gained throughhis years of experience at auditing firms.

12/12

12/12

Kazumi Akiyama

Kazumi Akiyama gained a wealth of insight through his years of employment at central government
offices.

12/12

12/12

Board ofDirectors

Audit & Supervisory Board

Criteria for the Selection of Outside Officers
In order to ensure the independence of the candidates it recommends for positions as outside officers (outside directors andoutside Audit & Supervisory Board Members), the Company has formulated criteria for the selection of outside officers. Please
see the following website for more details: https://www.ryoyo.co.jp/en/csr
Compensation of Directors and Audit & Supervisory Board Members
In regard to compensation decision policies and calculation methods, compensation amounts for directors and Audit &Supervisory Board Members are to be no higher than the upper limit approved at the general shareholders’ meeting. Compensation for directors is to be decided by the Board of Directors based upon reports from the Nomination and Compensation Committee. The Nomination and Compensation Committee will report its deliberations on each director’s compensation, taking into
consideration the performance of the Company and management circumstances, the economic climate, and such factors as eachdirector’s rank. Compensation amounts for Audit and Supervisory Board Members are decided by the Audit & Supervisory Board.
Compensation by type (millions of yen)
Total compensation

Number of applicable

Basic compensation Stock options

Retirement benefits individuals

Bonuses

Directors (excluding outside directors)

191

118

72

—

—

7

Audit & Supervisory Board Members(excluding outside Audit & Supervisory Board
Members)

15

15

—

—

—

1

Outside officers

34

34

—

—

—

5

Note: The amount for compensation of directors does not include the portion paid to directors who serve concurrently as employees.

Furthermore, the Company has revised the compensation plan for directors to introduce a restricted stock compensation
plan, effective from the fiscal year ending January 31, 2020. The introduction of this compensation plan is aimed at providing
directors with incentives to realize the sustainable improvement of the Company’s corporate value while further encouraging
them to share the same interests as the Company’s shareholders.
Analysis of Board of Directors’ Effectiveness andimprovements on matters such as the timing of provision of

Results of Evaluationmaterials pertaining to Board of Directors’ meetings, as well

The Company implements self-surveys to analyze the overall

as agenda items to be discussed at meetings, including thoseeffectiveness of the Board of Directors.

pertaining to medium-to-long-term management issues and

The most recent survey evaluated the structure of theother topics. Meanwhile, directors provided various sugges-

Board of Directors, how it is operated, how outside officers

tions on matters such as training opportunities for directors to

are treated, and other matters. Through this survey, theenable them to enhance their judgment and fulfil their role

Company confirmed that the Board of Directors was generally

and responsibilities, as well as the cultivation of mutual under-functioning appropriately and that it was indeed effective.

standing between outside officers and management.

Furthermore, the survey indicated that there had been

13

The Board of Directors will discuss these suggestions going

Each department maintains effective risk management sys-forward and continue to improve its effectiveness with thetems managed by employees that are responsible for risk

aim of creating an ideal corporate governance system.

management. In the event that any disruption occurs, these
employees will guide their department in responding quickly

Internal Control Systems

and effectively to those disruptions in order to minimize the

The following are our basic principles for establishing internal

impact on operations. For more information on business risks,

control systems. These principles help us maintain systems

please refer to the following section of the Company’s corpo-

for sound internal control.

rate website.

(1) S ystem for ensuring that the execution of duties by Group directors andemployees is in compliance with all laws, regulations, and the articles ofincorporation(2) Items concerning the storage and management of information related
to the execution of duties by directors(3) Rules and other systems for containing the risk of damages to the Group(4) System for ensuring the efficient execution of duties by Group directors(5) System for ensuring the appropriateness of operations undertaken by
the corporate group consisting of Ryoyo Electro and its subsidiaries andfor facilitating reporting to the Company with regard to the execution ofduties by directors and other individuals at subsidiaries(6) Items concerning employees requested by the Audit & Supervisory
Board to serve as assistants, the independence of these employees
from directors, and the effectiveness of the orders issued to such
employees by Audit & Supervisory Board Members(7) System concerning reports submitted by directors and employees of
the Company and by directors, Audit & Supervisory Board Members,
and employees of subsidiaries to the Audit & Supervisory Board of theCompany; other systems concerning reports submitted to the Audit &Supervisory Board; and systems for ensuring that individuals issuingsuch reports do not suffer disadvantageous treatment due to reporting(8) Items related to policies concerning the procedures through which
Audit & Supervisory Board Members may receive reimbursement,
prior to or after the fact, for expenses incurred during the execution of
their duties as well as the treatment of other expenses and liabilities
incurred as part of the execution of duties(9) Other systems for ensuring effective auditing by the Audit & Supervisory Board

https://www.ryoyo.co.jp/en/ir-library/business-risk

Risk Management Systems
Risks that may affect our operations include those related tocompliance, the environment, disasters, information security,
product quality, foreign exchange rates, and financial reporting.

Policy for Proactive Communication with Shareholders
The Company endeavors to ensure that disclosure of management
information is conducted accurately, impartially, and promptly.
In addition, we recognize that facilitating mutual understanding
through proactive communication with shareholders and incorporating feedback from shareholders into management decisionmaking are crucial to the Company’s ongoing growth and to themedium-to-long-term improvement of corporate value. Accordingly, the following provisions have been put in place to support
proactive communications activities.
(1) T he director in charge of the Corporate Strategy Division oversees
shareholder communications activities, receiving assistance from thegeneral manager of the Corporate Strategy Division.
(2) The Corporate Planning Department functions as a venue for communication with shareholders while preparations for communications
activities are advanced through coordination between the Corporate
Planning, General Affairs, and Accounting departments.
(3) E xplanatory forums are held for institutional investors at which wereport on and explain current business conditions and the future
direction of the Company.
(4) Systems are in place to ensure that feedback received throughshareholder communications activities is shared with management ina timely manner.
(5) In-house workshops regarding insider information are held and othersteps are taken to ensure the appropriate management of insider
information.
Note: T he Company strives to ensure timely and appropriate disclosure of management
information through its corporate website and other venues.
https://www.ryoyo.co.jp/en14

Financial Section

Consolidated Financial Review‌Operating Environment
During the year under review, the fiscal year ended January 31,
2019, the domestic economy continued its moderate recovery
against a backdrop of improved corporate earnings. However,
due to concerns about overseas political and economic conditions and the impact of changes in financial markets, the outlook
is increasingly cautious.
In the electronics industry, where the Ryoyo Group operates,
conditions varied by sector. Primarily in the automobile andindustrial sectors, there was an acceleration of initiatives toward
the practical application of technologies utilizing artificial intelligence (AI) and the Internet of Things (IoT). In addition, we saw
market expansion and the continuation of IT-related investment
by companies. On the other hand, there is growing concern
about the potential impact of prolonged trade friction between
the United States and China.

‌Results for the Fiscal Year Ended January 31, 2019
In this environment, the negative impact on sales caused by the
dissolution of distributorship contracts was offset by the Company’s efforts to incorporate demand related to AI and deeplearning as well as by the expansion of businesses dealing in
products for PCs. Accordingly, in addition to substantial increases
in profits as a result of a year-on-year decrease in inventory
write-downs, consolidated net sales increased 1.7% year on year,to ¥93.7 billion; operating income soared 400.1%, to ¥1.2 billion;
ordinary income increased 241.0%, to ¥1.4 billion; and profit
attributable to owners of parent rose 379.5%, to ¥1.0 billion.
Sales by Segment
Semiconductors and Devices
Net sales of semiconductors and devices decreased ¥1.0 billion
year on year, or 2.0%, to ¥49.9 billion.
Sales of products for communications applications fell 16.2%,
to ¥6.8 billion, due to the contraction of businesses providing
liquid crystal displays (LCDs) for use in smartphones.
Sales of products for digital consumer electronics decreased
19.4%, to ¥4.7 billion. Overall, sales performance was weak,despite the commencement of new projects for television­applications.
Sales of vehicle installations grew 16.1%, to ¥2.9 billion, due
to an increase in sales of products for use in vehicle installations,such as in-vehicle cameras and driving recorders.
Sales of products for PCs and peripherals increased 4.5%,
to ¥19.5 billion, due to increased sales of products for PCs
and peripherals.
Sales of products for industrial and other applications increased
1.1%, to ¥16.0 billion, driven by robust demand for products forrailway applications in the first half of the fiscal year under review.

15

Sales by Applications
Billions of yen

50.9

49.9

8.1

–16.2%

6.8

5.8
2.5

–19.4%+16.1%

4.7
2.9

18.7

+4.5%

19.5

15.8

+1.1%

16.0

18.1
Communications
Digital consumer electronics
Vehicle installations

19.1
PCs and peripherals
Industrial and others

ICT and Solutions
Net sales of ICT and solutions increased ¥2.5 billion year on year,
or 6.3%, to ¥43.8 billion.
Sales of PC, server, and network products rose 4.5%, to ¥9.8
billion, due partly to the contribution to sales of new security
products.
Sales of I/O equipment were more or less unchanged year on
year at ¥7.8 billion, as a decline in sales of printers was offset by
an increase in sales of monitors.
Sales of software were up 8.4%, to ¥15.0 billion, as a result of
an increase in PC production volumes.
Sales of embedded devices and other products increased
9.9%, to ¥11.3 billion, as higher sales of AI- and deep learningrelated products compensated for the negative impact of the endof one-off projects.

Sales by Products
Sales by Products
Billions of yen

43.8

41.3
9.4

+4.5%

9.8

7.8

–0.1%

7.8

13.9

+8.4%

15.0

10.3

+9.9%

11.3

18.1
PC / Server / Network
I/O equipment

19.1
Software
Embedded devices and others

Sales by Region
Japan
In the year under review, sales to external customers in Japan
increased ¥2.4 billion, or 3.3%, to ¥78.2 billion, following an
increase in sales of software for PCs and products for use in AI
and deep learning applications. Accordingly, operating incomein this regional segment was up ¥0.9 billion, or 589.7%, to¥1.1 billion, due to a reduction in inventory write-downs.
Asia
Sales to external customers in Asia decreased ¥0.9 billion, or
5.6%, to ¥15.5 billion, as a result of a decline in sales of LCDs
for use in communications devices. However, operating incomein this regional segment increased ¥56 million, or 66.8%, to¥0.1 billion, following an improvement in the gross profit margin.
The figure for operating income presented in the consolidated
statements of income includes operating income from eachsegment as well as from intersegment transactions.

‌Financial Position
Total assets at the end of the fiscal year amounted to ¥75.9
billion, ¥2.1 billion lower than at the previous fiscal year-end.
This was primarily due to a decrease in investment securities.
Total liabilities were up ¥32 million, to ¥13.7 billion, mainly
due to an increase in notes and accounts payable–trade.
Total net assets decreased ¥2.1 billion, to ¥62.2 billion. This
was largely due to cash dividends paid and a decrease attributable to the valuation difference on available-for-sale securities.

‌Cash Flows
Cash and cash equivalents totaled ¥13.4 billion at the fiscal
year-end, a ¥0.4 billion year-on-year decrease. Major factors
included cash dividends paid.
Net cash provided by operating activities was ¥0.5 billion.
This outcome was the result of income before income taxes of¥1.5 billion being recorded and of working capital increasing due
to the ¥1.3 billion rise in inventories.
Net cash provided by investing activities amounted to ¥0.5 billion. This was due to payments into time deposits of ¥1.1 billion.
Net cash used in financing activities amounted to ¥1.4 billion.
Major outflows included cash dividends paid.

‌Returning Profits to Shareholders
The Company views returning profits generated from operating
activities to its shareholders as one of its most importantmanagement tasks. Accordingly, we return profits to shareholders while considering the Company’s financial position and theoperating environment, while also retaining internal revenues
sufficient enough to maintain a stable operating foundation andpursue future business expansion.
For the fiscal year ended January 31, 2019, with an emphasis
on stable dividends and a total return ratio of 100% as our basic
policy, the Company paid ¥30 per share of common stock forthe year-end cash dividend, making for an annual cash dividendof ¥60 per share of common stock when combined with theinterim dividend.
The Company’s basic policy for the fiscal year ending January
31, 2020 is to pay stable dividends, targeting a dividend on
equity ratio (DOE) of 3%, with the aim of further enhancing­shareholder returns.
Based on this policy, we plan to increase the annual cash
dividend by ¥20 from the year under review, to ¥80 per shareof common stock, comprising an interim dividend and a year-end
dividend of ¥40 each.

‌Risks Pertaining to the Company’s Business
Risks that may affect the business performance, stock price, andfinancial condition of the Company include, but are not limited to,the following.
(1)	Abrupt changes in economic conditions(2)	Fall in the price of products(3)	Contracts with suppliers(4)	Fluctuations in foreign exchange rates(5)	Customers moving operations overseas(6)	Country-based risks(7)	Product defects, service problems, and delivery andintellectual property rights issues(8) Natural disasters and other acts of God(9)	Collection of accounts receivable(10)	Disposal and the write-down of inventories(11)	Impairment losses on the write-down of investment securities(12)	Retirement benefit obligations
For more information, please refer to the Company’s
corporate website.
    https://www.ryoyo.co.jp/en/ir-library/business-risk

16

Financial Section

Consolidated Balance Sheets
Ryoyo Electro Corporation and Consolidated Subsidiaries
At January 31, 2019 and 2018

Thousands of
U.S. dollars

Millions of yen

2019.1

2018.1

2019.1

Cash and deposits¥13,416¥14,040$123,134

Notes and accounts receivable–trade25,58525,912

234,811

AssetsCurrent assets

Securities
Merchandise and finished goods
Deferred tax assets

544

649

5,000

12,124

10,857111,274

409

497

3,758

1,444

1,378

13,260

(2)

(2)

(20)

53,52353,332491,219

		 Tools, furniture and fixtures, net

91

81

837

		Land

5

5

52

Other
Allowance for doubtful accounts
			Total current assets
Noncurrent assets
Property, plant and equipment

		Other, net

91

76

844

			Total property, plant and equipment

188

163

1,733

Intangible assets

404

454

3,708

19,43921,930178,406

Investments and other assets
Investment securities
Net defined benefit asset

1,431

1,458

13,136

Other

1,305

1,152

11,984

Allowance for doubtful accounts

17

(344)

(381)

(3,161)

			Total investments and other assets

21,832

24,160200,367

			Total noncurrent assets

22,425

24,778205,809

			Total assets¥75,948¥78,111$697,029

Thousands of
U.S. dollars

Millions of yen

2019.1

2018.1

2019.1

Liabilities
Current liabilities
Notes and accounts payable–trade¥10,092¥ 9,653$ 92,627

Income taxes payable

126

419

1,156

Accrued consumption taxes

248

87

2,276

Provision for bonuses

241

205

2,216

Other

815

716

7,480

11,523

11,082

105,757

802

790

7,367

Deferred tax liabilities

876

1,429

8,039

Other

537

405

4,930

			Total current liabilities
Noncurrent liabilities
Net defined benefit liability

			Total noncurrent liabilities

2,216

2,624

20,338

			Total liabilities

13,73913,706

126,095

Capital stock

13,672

13,672

125,477

Capital surplus

13,336

13,336

122,398

Retained earnings

35,82736,287

328,812

Treasury shares(2,690)(2,707)(24,691)

60,14560,588551,997

1,569

3,013

14,402

Net assets
Shareholders’ equity

			Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
			Total accumulated other comprehensive income

(0)

(0)

(4)

189

430

1,737

182

313

1,671

1,940

3,756

17,806

123

59

1,129

			Total net assets

62,20864,404570,933

			Total liabilities and net assets¥75,948¥78,111$697,029

Subscription rights to shares

18

Financial Section

Consolidated Statements of Income andConsolidated Comprehensive Statements of Income
Ryoyo Electro Corporation and Consolidated Subsidiaries
For the years ended January 31, 2019 and 2018
Thousands of
U.S. dollars

Millions of yen
Consolidated Statement of Income

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Provision of allowance for doubtful accounts
Salaries and bonuses
Provision for bonuses
Retirement benefit expenses
Rent expenses
Depreciation
Other
		 Total selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Purchase discounts
Gain on investments in partnership
Other
		 Total non-operating income
Non-operating expenses
Sales discounts
Foreign exchange losses
Commission fee
Loss on abandonment of noncurrent assets
Other		Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of investment securities
Gain on liquidation of subsidiaries and associates
		 Total extraordinary income
Extraordinary losses
Loss on sales of investment securities
Loss on valuation of investment securities
Loss on liquidation of subsidiaries and associates
		 Total extraordinary losses
Income before income taxes and minority interests
Income taxes–current
Income taxes–deferred		Total income taxes
ProfitProfit attributable to owners of parent

2019.1

2018.1

2019.1¥93,799
84,874
8,925¥92,234
84,6437,591$860,866
778,950
81,915

77
3,027
240
93
362
217
3,650
7,667
1,257

229
2,900
205
129
345
224
3,304
7,339
251

714
27,781
2,204
854
3,322
1,992
33,50370,373
11,541

110
123
6
60
24
325

73
157
8
55
19
313

1,015
1,134
59
555
222
2,987

12
75
18
1
1
108
1,474

7
99
9
12
3
132
432

111
692
165
15
12
997
13,531

145
16
162

242
–
242

1,337
155
1,492

–
104
–
104
1,532
282
229
512
1,020
¥ 1,020

33
28
124
186
488
507
(231)
275
212
¥   212

–
957
–
957
14,066
2,593
2,107
4,701
9,364
$  9,364

1,020

212

9,364

(1,444)
0
(240)
(131)
(1,816)
(796)

567
(0)
(98)
91
559
772

(13,258)
3(2,209)(1,206)(16,671)(7,306)

(796)
–

772
–

(7,306)–

Consolidated Comprehensive Statement of Income

Profit attributable to owners of parent
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
		 Total other comprehensive income
Comprehensive income(Details)
Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests
19Consolidated Statements of Changes in Net Assets
Ryoyo Electro Corporation and Consolidated Subsidiaries
For the years ended January 31, 2019 and 2018

Millions of yen
Shareholders’ equity

Accumulated other comprehensive income

From February 1, 2018
to January 31, 2019

Capitalstock

CapitalsurplusRetainedearnings

Treasury
stock

Total
shareholders’equityBalance at January 31, 2018
Changes of items during
the period
Dividends from surplus
Profit attributable to ownersof parent
Purchase of treasury shares
Disposal of treasury sharesExercise subscription rights
to sharesNet changes of items otherthan shareholders' equity
Total changes of items during
the period
Balance at January 31, 2019¥13,672¥13,336¥36,287¥(2,707)¥60,588(1,470)–¥13,336

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustment

Remeasurements ofdefinedbenefit plans

Subscription
rights tosharesTotal
net assets¥   3,013

¥(0)

¥ 430

¥ 313

¥ 59

¥64,404(1,470)(1,470)

0

(1)
0

1,020
(1)
0

1,020
(1)
0

(9)

18

9

9

1,020

–
¥13,672

Valuationdifferenceonavailablefor-salesecurities(460)¥35,827

17¥(2,690)(442)¥60,145(1,444)

0

(240)

(131)

63

(1,753)(1,444)¥   1,569

0
¥(0)

(240)
¥ 189

(131)
¥ 182

63
¥123

(2,195)¥62,208

Millions of yen
Shareholders’ equity

Accumulated other comprehensive income

From February 1, 2017
to January 31, 2018

Capitalstock

CapitalsurplusRetainedearnings

Treasury
stock

Total
shareholders’equityValuationdifferenceonavailablefor-salesecurities

Balance at January 31, 2017
Changes of items during
the period
Dividends from surplus
Profit attributable to ownersof parent
Purchase of treasury shares
Disposal of treasury shares
Retirement of treasury sharesNet changes of items otherthan shareholders’ equity
Total changes of items during
the period
Balance at January 31, 2018¥13,672¥13,336¥38,244¥(3,649)¥61,602¥2,446(1,225)
212
(2)
0
944

0
(944)

–
¥13,672–¥13,336(1,956)¥36,287942¥(2,707)

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustment

Remeasurements ofdefinedbenefit plans

Subscription
rights tosharesTotal
net assets

¥(0)

¥528

¥222

¥59

¥64,859(1,225)(1,225)

212
(2)
0
–

212
(2)
0
–

(1,014)¥60,588

567

(0)

(98)

91

–

559

567
¥3,013

(0)
¥(0)

(98)
¥430

91
¥313

–
¥59

(454)
¥64,404

Thousands of U.S. dollars
Shareholders’ equity

From February 1, 2018
to January 31, 2019

Balance at January 31, 2018
Changes of items during
the period
Dividends from surplus
Profit attributable to ownersof parent
Purchase of treasury shares
Disposal of treasury sharesExercise subscription rights
to sharesNet changes of items otherthan shareholders' equity
Total changes of items during
the period
Balance at January 31, 2019

Accumulated other comprehensive income

Retainedearnings

Treasury
stock

Total
shareholders’equityValuationdifferenceonavailablefor-salesecurities$125,477 $122,398 $333,035$(24,851)$556,059$ 27,660

Capitalstock

Capitalsurplus(13,498)

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustment

Remeasurements ofdefinedbenefit plans

Subscription
rights tosharesTotal
net assets$(7)$ 3,947$ 2,877$ 549$591,086(13,498)(13,498)

0

(13)
0

9,364
(13)
0

9,364
(13)
0

(87)

173

85

85

9,364

–
–
(4,222)
160$125,477 $122,398 $328,812 $(24,691)(13,258)

3(2,209)(1,206)580(16,091)(4,062)(13,258)$551,997 $ 14,402

3$(4)(2,209)$ 1,737(1,206)$ 1,671580$1,129(20,153)$570,933

20

Financial Section

Consolidated Statements of Cash Flows
Ryoyo Electro Corporation and Consolidated Subsidiaries
For the years ended January 31, 2019 and 2018

Thousands of
U.S. dollars

Millions of yen

2019.1

2018.1

2019.1¥ 1,532
217
0
72
(60)
(3)
1
3
(234)
(145)
104
–
196
(1,310)
518
160
(168)
886
212
(509)
588

¥   488
226
12
–
(55)
(17)
253
0
(230)
(208)
28
124
3,308
(291)
92
62
(604)
3,189
231
(346)
3,074

$ 14,066
1,998
0
665
(555)
(31)
17
31
(2,150)(1,337)957–
1,799(12,024)
4,759
1,477
(1,543)8,132
1,950(4,676)
5,405

II. Cash flows from investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of securities
Proceeds from redemption of securities
Purchase of property, plant and equipment and intangible assets
Proceeds from sales of property, plant and equipment and intangible assets
Purchase of investment securities
Proceeds from sales of investment securities
Purchase of shares of subsidiaries and associates
Payments of loans receivable from subsidiaries and associates
Collection of loans receivable from subsidiaries and affiliates
Proceeds from distribution of investment in partnerships
Purchase of insurance funds
Other, net
Net cash provided by (used in) investing activities(1,049)
1,192
–
100
(165)
5
(8)
220
(3)
(99)
99
183
(50)
118
543

(1,028)
1,050
(552)
2,000
(81)
0
(12,876)
4,080
–
(72)
99
153
(39)
28
(7,236)(9,627)
10,946–917(1,517)
54
(82)
2,019
(28)
(913)
913
1,680
(465)
1,091
4,988

III. Cash flows from financing activities
Cash dividends paid
Purchase of treasury shares
Proceeds from sales of treasury shares
Net cash provided by (used in) financing activities(1,467)(1)
0(1,468)(1,222)(2)
0(1,224)(13,465)(13)
0(13,479)

(140)
(476)
13,893¥13,416(62)(5,449)19,343¥ 13,893(1,286)(4,371)
127,506$123,134

I. Cash flows from operating activities
Income before income taxes
Depreciation and amortization
Loss (gain) on sales and retirement of noncurrent assets
Share-based compensation expenses
Loss (gain) on investments in partnership
Foreign exchange losses (gains)
Increase (decrease) in provision
Increase (decrease) in net defined benefit liability
Interest and dividends income
Loss (gain) on sales of investment securities
Loss (gain) on valuation of investment securities
Loss on liquidation of subsidiaries and associates
Decrease (increase) in notes and accounts receivable–trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable–trade
Increase (decrease) in accrued consumption taxes
Other, net
SubtotalInterest and dividends income received
Income taxes refund (paid)
Net cash provided by (used in) operating activities

IV. Effect of exchange rate changes on cash and cash equivalents
V. Net increase (decrease) in cash and cash equivalents
VI. Cash and cash equivalents at beginning of period
VII. Cash and cash equivalents at end of period21Corporate Data / Investor Information
As of January 31, 2019

Corporate Name
Ryoyo Electro Corporation

Composition of Shareholders

Address
Konwa Building, 1-12-22
Tsukiji, Chuo-ku, Tokyo
104-8408, JapanPhone+81-3-3543-7711
Fax+81-3-3545-3507
Websitehttps://www.ryoyo.co.jp/enDate of Incorporation
February 27, 1961
Paid-in Capital¥13,672 million

Foreign corporations and other foreign investors

25.9%

Individuals and other

23.9%

Financial institutions

21.8%

Other corporations

19.4%

Treasury stock

8.5%

Securities companies, etc.

0.5%

Major Shareholders
Thousandsof shares

CGML PB CLIENT ACCOUNT/COLLATERAL

3,863

Mitsubishi Electric Corporation

2,246

9.16

SHC Corporation

2,118

8.64

Japan Trustee Services Bank, Ltd. (Trust account)

1,858

7.58

The Master Trust Bank of Japan (Trust account)

1,165

4.75

523

2.13

Nippon Life Insurance Company

409

1.67

Japan Trustee Services Bank, Ltd. (Trust account 5)

391

1.60

Japan Trustee Services Bank, Ltd. (Trust account 9)

335

1.37

SSBTC CLIENT OMNIBUS ACCOUNT

288

1.18

Note: Calculations for the ownership percentages above do not account for the 2,278,591 shares of treasury stock.

Shares Issued
26,800,000

Stock Price Chart

Stock Trading Unit
100 shares
Stock Listing
Tokyo Stock Exchange,
First Section
Ticker Code
8068

15.76

Sheep Shokai Co.

Authorized Shares
119,628,800

Shareholders
7,010

%

Stock Price
Yen

Nikkei Stock Average
Yen

25,000

2,500

2,000

20,0001,500

15,0001,000

10,000

Trading Volume
Thousands of shares

4,500

3,000

Transfer Agent
Mitsubishi UFJ Trust andBanking Corporation

1,500

0

1

2

3

4

5

6

7

2016

8

9 10 11 12 1

2

3

4

5

6

7

2017

8

9 10 11 12 1

2

3

4

5

6

7

8

9 10 11 12 1

2018

2

3

2019

Caution on Forward-Looking Statements
The contents of this annual review that are not historical fact represent projections based on expectations and plans for the future. These projections contain elements of risk anduncertainty. As a result, forward-looking statements made in this annual review may differ from actual results and performance.
Notes on Performance Figures in This Annual Review
The performance figures used in this annual review, including those from previous fiscal years, are based on Ryoyo Electro Corporation’s audited Japanese financial reviews.

22

In consideration for the environment, this annual review uses paper that has been approved by the
Forest Stewardship Council (FSC). Additionally, this annual review is printed using highly biodegradable
vegetable oil ink.

Printed in Japan