Year Ended December 31, 2021

FY 2021 Non-consolidated Financial Results

February 4, 2022

(All financial information herein has been prepared in accordance with accounting principles generally accepted in Japan.
This document is an English translation from the original Japanese-language document. This translation is not subject toauditing standards in the U.S.)
Listed company name: Original Engineering
Consultants Co., Ltd.
Code number:
4642

Stock listing:Tokyo Stock Exchange, Second Section(URL https://www.oec-solution.co.jp)

Representative: Title President & Representative Director Name:
Contact person: Title Director & General Manager of
Name:
Financial Affairs Division
Planned Annual General Meeting of Shareholders: March 29, 2022
Planned date of payment of dividends: March 30, 2022
Planned filing of a financial report: March 29, 2022
Earnings supplementary explanatory documents: None
Earnings presentation: None

Nobuhiko Suga
Kaoru Kira

Tel: (03) 6757-8800(Amounts less than ¥1 million are truncated)
1.
NON-CONSOLIDATED FINANCIAL RESULTS FOR FY 2021 (January 1, 2021 to December 31, 2021)(1) Non-consolidated Operating Results(Percentages represent year-on-year changes)

FY 2021 ended
December 31, 2021
FY 2020 ended
December 31, 2020

Net sales
Million yen%

Operating income
Million yen%

Ordinary income
Million yen%

ProfitMillion yen

%

6,207

-1.1

575

-13.4

625

-3.4

376

0.2

6,274

-1.0

664

-16.9

647

-20.7

375

-22.0

Profit per sharebasic
Yen

Profit per sharediluted
YenincomeReturn on equity Ordinary
to total assets Operating margin%%%

FY 2021 ended
64.38
6.5
December 31, 2021
FY 2020 ended
64.53
64.51
6.7
December 31, 2020
(Reference) Gain (loss) on investment by equity method: FY 2021: ¥- million

8.9

9.3

9.2

10.6

FY 2020: ¥- million(2) Non-consolidated Financial Position
Total assets

Net assets

Shareholders’ equity
ratio%

Net assets per share

Million yen
Million yen
Yen
As of December 31,
7,099
5,914
83.3
1,009.67
2021
As of December 31,
7,022
5,699
81.2
975.922020(Reference) Shareholders’ equity: As of December 31, 2021: ¥5,914 million As of December 31, 2020: ¥5,699
million(3) Non-consolidated Cash FlowsFY 2021 ended
December 31, 2021
FY 2020 ended
December 31, 2020

Cash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities

Million yen

Million yen

Million yen

Cash and cash
equivalents at theend of the period
Million yen

282

120

-227

2,836

-102

-68

-196

2,660

2. DIVIDENDS(Record date)
FY 2020 ended
December 31, 2020
FY 2021 ended
December 31, 2021
FY 2022 ending
December 31, 2022
(Forecast)

Dividends per share
Total dividend Payout
Ratio ofEnd
of End of third Fiscal
amountdividends
toEnd of first second
ratio
Full year (Full year)
net assets
quarter
year-endquarterquarter
Yen

Yen

Yen

Yen

Yen

Million yen

%

%

-

0.00

-

32.00

32.00

188

49.6

3.3

-

0.00

-

32.00

32.00

190

49.7

3.2

-

0.00

-

32.00

32.00

49.3

3. FORECAST OF NON-CONSOLIDATED RESULTS FOR FY 2022 (January 1, 2022 to December 31, 2022)(Percentages represent changes from the same period of the previous fiscal year)
Net sales
Operating income
Ordinary income
ProfitProfit per share
Million yen% Million yen% Million yen% Million yen%
Yen
Full year
6,400
3.1
630 9.4
630
0.7
380
1.0
64.87
*NOTES(1) Changes in accounting policies, changes in accounting estimates and retrospective restatements:(i) Changes in accounting policies in accordance with revision of accounting standards: None(ii) Changes in accounting policies other than (i) above: None(iii) Changes in accounting estimates: None(iv) Retrospective restatements: None
(2) Number of outstanding shares (Common stock)(i) Number of shares outstanding at end of period, including treasury stock
As of December 31, 2021: 7,796,800 shares As of December 31, 2020: 7,796,800 shares(ii) Number of shares of treasury stock at end of period
As of December 31, 2021: 1,938,573 shares As of December 31, 2020: 1,956,441 shares(iii) Average number of shares outstanding for each period
As of December 31, 2021: 5,841,597 shares As of December 31, 2020: 5,818,511 shares* The summary of financial results is not subject to audit by certified public accountants or audit corporations.
Note regarding forecasts and forward-looking statements
The business results forecasts presented are based on information available to the Company at the present time and are
subject to potential risks and uncertainty. Accordingly, actual results may differ significantly from any expressed
future performance herein due to various factors. For matters relating to results forecasts, please refer to “1.
SUMMARY OF BUSINESS RESULTS,” “(4) Future Outlook” on page 4 of the Attachment.

Index of the Attachment
1.

SUMMARY OF BUSINESS RESULTS ................................................................................................................ 2(1) Summary of Business Results for Current Period ............................................................................................ 2(2) Summary of Financial Position for Current Period .......................................................................................... 3(3) Summary of Cash Flows for Current Period..................................................................................................... 4(4) Future Outlook .................................................................................................................................................. 4

2.

BASIC POLICY FOR THE SELECTION OF ACCOUNTING STANDARDS ............................................... 5

3.

FINANCIAL STATEMENTS AND PRIMARY NOTES..................................................................................... 6(1) Non-consolidated Balance Sheets ..................................................................................................................... 6(2) Non-consolidated Statements of Operations ..................................................................................................... 8(3) Non-consolidated Statements of Changes in Net Assets................................................................................... 9(4) Non-consolidated Statements of Cash Flows .................................................................................................... 11(5) Notes regarding the Non-consolidated Financial Statements ........................................................................... 13(Matters Affecting the Assumption of a Going Concern)................................................................................. 13(Segment Information) ...................................................................................................................................... 13(Profit and Loss under Equity Method) ............................................................................................................ 13(Per Share Information) .................................................................................................................................... 13(Significant Subsequent Events) ....................................................................................................................... 14

1

1.

(1)

SUMMARY OF BUSINESS RESULTS

Summary of Business Results for Current Period

According to a provisional calculation of the Cabinet Office, Japan’s water and sewerage infrastructure assets
amount to approximately ¥130 trillion, which indicates that the water and sewerage infrastructure stock is the secondlargest infrastructure stock in the country by sector after road infrastructure stock. Among these, most of the population
has access to water supplies, with the total length of water pipes reaching around 720,000 kilometers across Japan.
However, the national average annual rate of renewing water pipes is as low as 0.68%, which means that it will takealmost 130 years to renew all of these pipes. The statutory useful life of water pipes is 40 years, but they are expected
to deteriorate further due to the slow progress in renewing the water pipes infrastructure, much of which was built
during the high-growth period. Therefore, renewing aged water pipes has become an important issue for stably
supplying safe water.
In the sewerage field, 92.1% of the population of Japan has access to sewage treatment facilities (as of the endof FY2020), but only 80.1% has access to sewers, which means nearly 9.9 million people still live without access to
sewage treatment facilities; promoting sewage services needs to be accelerated. While the need to construct new
facilities is on the decrease, a great number of water and sewage facilities that were rapidly built during the highgrowth period are reaching the end of their useful lives every year. Maintenance and renewal of these infrastructure
assets, which are indispensable for ensuring a safe, secure, and culturally strong living environment, are thus in demand.
In addition, needs are growing for flood control measures to protect human lives and assets from localized torrential
rainfall and large typhoons, which have occurred frequently in recent years, anti-seismic measures such as quakeresistant toilet facilities, and measures for reinforcing water and sewerage systems to make them tsunami resistant.
Out of the Japan’s FY2021 budget, passed and approved in March 2021, the total amount to be allocated to“general social infrastructure development,” including the sewerage budget, which is closely connected with thebusiness of the Company, is a national expenditure of ¥1,467 billion. The amount is broken down to ¥837.6 billion fordisaster prevention and safety subsidies and ¥629.5 billion for general social infrastructure development subsidies.
Since where subsidies will be spent is left to the discretion of local governments, the allocated amount dedicated to
sewerage operations is not known, but the amount of the related budget, though unofficially announced, is expected to
grow a little, compared with the previous fiscal year. On the other hand, the total of sewerage operational costs inordinance-designated cities with a large budget across the country and the Tokyo metropolitan area, is ¥ 612.1 billion, adecrease of 1.4% from the beginning of the previous fiscal year.
The Company, in this operating environment, is working aggressively to win orders mainly in the water supply
field, particularly for services related to asset management in line with the Water Supply Division of the Ministry of
Health, Labour and Welfare’s new water supply vision that focuses on the keywords of “safety, strength, sustainability,
collaboration and challenge.” In the sewerage field, the Company pursues orders in line with the seven major themes
set by the Sewerage and Wastewater Management Department of MLIT: Strengthening earthquake recovery andreconstruction support and implementing national measures for safety and peace of mind; early reduction of areas
lacking sewerage infrastructure; promoting water environmental management; improving facilities management andoperations; strengthening sewerage management; promoting measures to achieve a low-carbon, recycling-oriented
society; and, promoting international water businesses through globalization and private-public initiatives. We also
make efforts to obtain orders for services related to support by the Ministry of Internal Affairs and Communications for
introducing local public enterprise-based accounting into small-scale water supply and sewerage operations, inaccordance with the Local Public Enterprise Act, as well as operations including those to formulate strategies for
managing sewerage operations. In the domestic market, we have the competitive advantage of deep knowledge of thedevelopment status of facilities of local governments that are our existing customers and their business issues. Backed
by this, the Company engages in activities to win orders with a high repeat rate through tailor-made technical proposals
and flexible customer services while carrying out sales programs to explore new customers based on the accumulated
track record. In overseas markets, the Company has been working to win orders by tapping into projects in emerging
nations through public-private partnerships.
With regard to its internal work environment, the Company is striving to distribute profits to employees andincrease revenue by boosting productivity and reducing costs through the following measures: providing 90 percent of
its employees with smartphones and notebook PCs and creating an office environment in which a free address system
and a wireless LAN system are available to introduce a telework environment, allowing employees to work anywhere2not only in the office but also outside the office; facilitating prompt information-sharing between different levels andutilizing chat tools, on which the Company has worked to raise awareness internally; speedily responding todepartmental issues by checking management benchmarks by department when necessary; conducting appropriate
budget management, process control, progress management, and outsourcing management for orders received for
projects; upgrading in-house engineers’ skills; securing and fostering young employees who will lead the next
generation; reducing overtime to comply with the revised Labor Standards Act; promoting health management; andutilizing internal systems, such as a staggered working hours system and promoting the use of paid leave, that allow
each employee to work flexibly according to his/her own circumstances.
During the fiscal year under review, the Tokyo Olympic and Paralympic Games took place behind closed doors,and various government-led initiatives were taken to prevent the spread of COVID-19 in Japan amid the Games. Alongwith such initiatives, the COVID-19 vaccination rate increased. The Company continued its business activities bytaking measures that pay due consideration to the safety and security of employees, such as encouraging the use of awork-from-home system and staggered working hours, and establishing vaccination leave. As a response measure to
projects that require various types of expertise, the Company made efforts to build a more efficient production system,
leveraging the Company’s human resources in distant offices by making effective use of online meetings.
During the period from April, in which the fiscal period of government agencies started, the budget executionof local governments, which was related to the Company, was generally underway as scheduled, and activities for
capturing project orders went well. However, mainly due to the impacts of declarations of a state of emergency andquasi-emergency measures pursuant to the Act on Special Measures against COVID-19, some local cities limited thenumber of visitors and asked for advance PCR tests when traveling from large cities where many of the Company’sengineers are located to local cities where many of its customers are located. This caused difficulties in conducting fieldsurveys that are hard to perform online and face-to-face discussions that would allow smooth questions and answers,
resulting in a delay in the progress of many projects and business activities. With regard to overseas projects, on-site
works have resumed because travel was permitted to some regions where travel restrictions were eased.
As a result, the non-consolidated orders received during the fiscal year under review amounted to ¥6,333
million, an increase of 1.1% compared with the previous fiscal year. The main causes for the increase in orders received
are considered to be the increased number of orders received against the backdrop of an increase in the development of
new customers attributed to growth of young employees, receipt of orders for a large-scale turnkey design andconstruction project, and improvement of production systems due to engineers who were hired in the middle of theircareer becoming a substantial part of the workforce. On the other hand, net sales amounted to ¥6,207 million, a 1.1%
decrease from the previous fiscal year. Operating income amounted to ¥575 million, a decrease of 13.4% comparedwith the previous fiscal year, and ordinary income decreased 3.4% to ¥625 million. Profit amounted to ¥376 million, an
increase of 0.2% compared with the previous fiscal year.
Results by operating division were as follows.
[Engineering Consultant Department]
The Engineering Consultant Department received orders totaling ¥5,789 million during the fiscal year underreview, a decrease of 1.2% compared with the previous fiscal year. Sales by the department decreased 0.4%, to ¥5,763
million.
[Information Processing Department]
In the Information Processing Department, orders received increased 32.7% compared with the previous fiscal
year, to ¥544 million. Sales by the department decreased 9.0%, to ¥443 million.

(2)

Summary of Financial Position for Current Period(Current assets)
Current assets at the end of the fiscal year under review amounted to ¥5,826 million (up 4.2% from the end of
the previous fiscal year). The main factors contributing to this change included an increase in cash and deposits due tothe receipt of payment for operations.
(Noncurrent assets)
Noncurrent assets at the end of the fiscal year under review stood at ¥1,273 million (down 10.9% from the endof the previous fiscal year). The main factors contributing to this change included a decrease in investment securities
3

due to redemption of investment securities.
(Current liabilities)
Current liabilities at the end of the fiscal year under review stood at ¥993 million (down 9.4% from the end of
the previous fiscal year). The main factors contributing to this change included a decrease in advances received on
uncompleted services due to a decline of payments received for operations and a decrease in accrued consumption taxes.
(Noncurrent liabilities)
Noncurrent liabilities at the end of the fiscal year under review stood at ¥191 million (down 15.5% from theend of the previous fiscal year). The main factors contributing to this change included a decrease in lease obligations
due to a decrease in lease contracts and a decrease in provision for retirement benefits.
(Net assets)
Net assets at the end of the fiscal year under review amounted to ¥5,914 million (up 3.8% from the end of theprevious fiscal year). The main factors contributing to this change included an increase in retained earnings due to therecording of profit.

4

(3)

Summary of Cash Flows for Current Period

Cash and cash equivalents stood at ¥2,836 million (up 6.6% from the end of the previous fiscal year) at the endof the fiscal year under review.
The main factors contributing to changes in cash flows during the fiscal year under review were as follows:(Cash flows from operating activities)
Net cash provided in operating activities amounted to ¥282 million (net cash used by these activities amounted
to ¥102 million in the previous fiscal year).
The main factors contributing to this change were the posting of profit before income taxes and decreases innotes and accounts receivable―trade and income taxes paid.
(Cash flows from investing activities)
Net cash provided in investing activities amounted to ¥120 million (net cash used by these activities amounted
to ¥68 million in the previous fiscal year).
This was mainly due to the purchase and redemption of investment securities, and the purchase of noncurrent
assets.
(Cash flows from financing activities)
Net cash used in financing activities amounted to ¥227 million (increased 15.7% compared with the previous
fiscal year).
Significant factors contributing to this change included the payment of cash dividends.
FY 2019

FY 2020

FY 2021

Shareholders’ equity ratio (%)

78.6

81.2

83.3

Shareholders’ equity ratio on a market value basis (%)

81.2

81.1

82.2

Interest-bearing debt to cash flow ratio (years)

0.11

-

0.39

128.56-

86.41

Interest coverage ratio (times)

Ratio formula:
Shareholders’ equity ratio: Shareholders’ equity / total assets
Shareholders’ equity ratio on a market value basis: Market capitalization / total assets
Interest-bearing debts to cash flow ratio (years): Interest-bearing liabilities / cash flows from operating activities
Interest coverage ratio: Cash flows from operating activities / interest payments
Notes:
1. Market capitalization is calculated by multiplying the share price at end of period by the number of shares
outstanding at end of period (excluding treasury stock).
2. Cash flows in these indicators refer to net cash from operating activities as stated in the Non-consolidated
Statements of Cash Flows. Interest-bearing liabilities are all liabilities presented on the Non-consolidated
Balance Sheets that are subject to interest expenses. Interest payments are those stated in the Non-consolidated
Statements of Cash Flows.

(4)

Future Outlook

The overall budget for public works projects of the Ministry of Land, Infrastructure, Transport and Tourism(MLIT), which is closely related to the Company’s businesses, for fiscal 2022 was approved by the Cabinet meeting in
December 2021. The total amount of “Disaster Prevention and Safety Subsidies” and “General Social Infrastructure
Development Subsidies” allocated to sewerage operations of local governments, which is at 94% of the previous fiscal
year’s level, is expected to be executed. The budget for expenses related to sewerage works increased by ¥61,359
million, or a 41% increase from the previous fiscal year, primarily due to establishing an individual subsidy system for
decarbonization. During the same month, the supplementary budget for fiscal 2021 was also approved, and ¥58,000
million will be allocated to measures including those for floodplain management (flood control), earthquake measuresand addressing aging facilities.
Many areas were subject to a state of emergency declaration due to the COVID-19 pandemic for a long period
during fiscal 2021. However, water supply and sewerage budgets of local governments were executed largely asplanned. These included measures to address aging facilities and improve resistance to earthquakes; reduce areas5

lacking sewerage infrastructure; combat inland flooding; expand and share water and sewerage systems; prevent
rainwater infiltration; and save and generate energy. This occurred although there was a delay in the timing of orders.
The Company expects this trend will continue in fiscal 2022.
In order to respond to these needs, the Company will strive to resolve social issues not only in its main watersupply and sewerage field but also in the river, waste and environment, and overseas fields. It will do so by
encouraging experienced engineers to continue making self-improvements, bringing their capabilities together, andupgrading digitization services for water supply and sewerage information based on its information andcommunications technology (ICT) technologies that have been developed and accumulated over the years by the DX
Promotion Department of the Company.
Orders for local governments’ public procurement activities, which account for the majority of the Company’sorders received, are placed through price competitive auctions. As might be expected, contract prices and asking prices
vary widely in most cases. Accordingly, the Company is aware that it is expected to make management efforts toovercome various challenges to achieve its management goals. These include competition among firms; fluctuations inbidding prices; higher costs of works due to an increase in planning and designing operations for rebuilding andrenewal that require complex and advanced experience and expertise; and an increase in personnel expenses to respondto recruiting activities that are becoming increasingly difficult year by year and to prevent turnover of, secure, andfoster talented human resources.
The Company, meanwhile, has had a solid sense of an improvement in its corporate image. It has done thisthrough company-wide awareness reforms aimed at achieving the objectives of having every employee work with asense of management and establishing an organization with an open culture, which have been consistently pursued
under the present management structure. It has also done this by firmly establishing a far-sighted corporate culture
which has enabled a smooth company-wide transition to working from home and telework amid the pandemic. And it
has provided an effective work environment by doing research on the latest industry trends and having interviews with
its employees.
Passing on techniques of senior engineers and securing and fostering young employees who will lead the next
generation remain critical management issues for the Company. Based on its solid financial base, the Company will
endeavor to overcome management issues by continuing to improve and provide a work environment that
accommodates employees, improve employee satisfaction, and work on hiring talented human resources.
A growing number of local governments are expected to experience a decrease in staffing levels, and thecooperation and support of private companies are considered essential for continuing water supply and sewerage
operations. Under such circumstances, the Company will aim to solve social challenges and improve corporate value by
helping to sustain the water and sewerage services, which are vital for the lives of people, by offering the consultation
services it has cultivated to date in forms that are tailored to society’s needs.
In the fiscal year ending December 31, 2022, the Company forecasts orders will increase 3.1%, to ¥6,400
million, and net sales will rise 3.1%, to ¥6,400 million. Operating income is forecast to increase 9.4%, to ¥630 million,
and ordinary income to increase 0.7%, to ¥630 million. Profit is forecast to increase 1.0%, to ¥380 million.

2.

BASIC POLICY FOR THE SELECTION OF ACCOUNTING STANDARDSThe Company’s stakeholders are mostly domestic shareholders, creditors and business partners, and hence theCompany does not have much necessity to procure funds from overseas. Considering these factors, the Company
applies Japanese accounting standards.

6

3.

FINANCIAL STATEMENTS AND PRIMARY NOTES(1)

Non-consolidated Balance Sheets
Category

FY 2020(as of December 31, 2020)
Amount(thousand yen)

FY 2021(as of December 31, 2021)
Amount(thousand yen)

3,376,196
2,145,471
313
37,283200
59,533-26,240
5,592,758

3,552,478
2,202,044
761
37,099258
62,828-29,240
5,826,230

201,588
029,345150,015
116,382
497,331205,274
028,569150,015
108,564
492,423

3,321
122,345
1,983
3,711
131,361

3,321
122,771763
3,711
130,567

397,71350,000
5,093
67,085
161,501
5,773
87,25628,769-2,200800,994

260,506
50,000
4,092
73,124
163,747
6,799
65,66728,769-2,200650,508

1,429,687

1,273,498

7,022,446

7,099,729

AssetsCurrent assets
Cash and deposits
Accounts receivable—completed operation
Costs on uncompleted services
Prepaid expenses
Advances receivable from group affiliates
Other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings, net
Structures, net
Tools, furniture and fixtures, net
Land
Lease assets, net
Total property, plant and equipment
Intangible assets
Leasehold right
SoftwareLease assets
Telephone subscription right
Total intangible assets
Investments and other assets
Investment securities
Shares of subsidiaries and associates
Long-term loans receivable from employees
Insurance funds
Guarantee deposits
Long-term prepaid expenses
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets

7

FY 2020(as of December 31, 2020)
Amount(thousand yen)

FY 2021(as of December 31, 2021)
Amount(thousand yen)

267,263
35,161
71,616
191,356
116,224
94,832
147,743
109,530
39,973
11,583
11,288240,019
33,69969,262
160,555
141,001
45,394
116,730
112,600
40,137
20,29014,076

1,096,572

993,767

84,67020,13464,556
6,720
50,07077,64018,24538,6786,720
49,789226,152

191,074

1,322,724

1,184,841

1,093,000

1,093,000

2,171,308
694,421

2,171,308
702,924

2,865,729

2,874,232

2,800,000
512,1713,000,000
499,4113,312,171

3,499,411

Treasury stock-1,575,325-1,569,735

Total shareholders’ equity

5,695,575

5,896,907

4,145

17,9794,145

17,9795,699,721

5,914,887

7,022,446

7,099,729

Category
Liabilities
Current liabilities
Accounts payable—operating
Lease obligations
Accounts payable—otherAccrued expenses
Income taxes payable
Accrued consumption taxes
Advances received on uncompleted services
Deposits received
Provision for bonuses
Provision for loss on order received
Provision for share benefit
Total current liabilities
Noncurrent liabilities
Lease obligations
Provision for share benefit
Provision for retirement benefits
Long-term accounts payable—other
Asset retirement obligations
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Legal capital surplus
Other capital surplus
Total capital surpluses
Retained earnings
Other retained earnings
General reserve
Retained earnings brought forward
Total retained earnings

Valuation and translation adjustments
Valuation difference on available-for-sale securities
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets

8

(2)

Non-consolidated Statements of Operations

FY 2020(from January 1, 2020 to
December 31, 2020)
Amount(thousand yen)

FY 2021(from January 1, 2021 to
December 31, 2021)
Amount(thousand yen)Contracts completed

6,274,130

6,207,413

Cost of completed work

4,265,445

4,289,650

Gross profit

2,008,684

1,917,763

Selling, general and administrative expenses

1,343,696

1,341,993

664,987575,769

Interest income

240

119

Interest on securities

100

2,200

Dividend income

8,358

6,122

Dividends from silent partnerships

8,355

10,756

Commission fee

2,430

2,430

Gain on sales of investment securities

-

1,240

Gain on redemption of investment securities-

38,545

Foreign exchange gains

-

1,021

Other

8,777

6,419

Total non-operating income

28,261

68,856

Interest expenses

2,269

3,268

Expenses for securities transactions

8,801

9,481

Loss on valuation of investment securities

33,143

5,568

Foreign exchange losses

530

-

Other

987

720

45,731

19,039647,517625,586

Reversal of loss on construction compensation

-

1,067

Total extraordinary income

-

1,067

Loss on retirement of noncurrent assets

1,193

732

Loss on construction compensation

4,900

-

Payments

16,241-

Total extraordinary loss

22,334

732

Profit before income taxes

625,183

625,921

Income taxes―current

235,084

233,917

Income taxes-deferred

14,642

15,945

Total income taxes

249,726

249,863

Profit375,456

376,057

Category

Operating income
Non-operating income

Non-operating expenses

Total non-operating expenses
Ordinary income
Extraordinary income

Extraordinary loss

9

(3)

Non-consolidated Statements of Changes in Net Assets

FY 2020 (from January 1, 2020 to December 31, 2020)(Thousand yen)
Shareholders’ equity

Capital surplus

Balance at the beginningof current period
Changes of items during
the period
Provision of generalreserve
Dividends of surplus

Capital
stock

Legal
capitalsurplus

OthercapitalsurplusTotal
capitalsurpluses

1,093,000

2,171,308

704,775

2,876,083

Retained earnings
Other retained earnings
Retained Total retained
Generalearnings
earnings
reservebrought
forward2,500,000

612,909

3,112,909

300,000-300,000--176,194-176,194375,456

375,456

ProfitPurchase of treasury
stock
Disposal of treasurystock
Net changes of items
other than shareholders’equityTotal changes of items
during the period
Balance at the end ofcurrent period-10,353-10,353---10,353-10,353

300,000-100,737

199,262

1,093,000

2,171,308

694,4212,865,729

2,800,000

512,171

3,312,171

Valuation and translation
adjustments
Subscription
Valuationrights to
Total valuation
Total
difference onsharesand translation
shareholders’available-foradjustments
equitysale securities

Total net
assetsShareholders’ equity
Treasurystock
Balance at the beginningof current period
Changes of items during
the period
Provision of generalreserve
Dividends of surplus-1,610,179

34,51034,510378

5,506,702---176,194-176,194375,456

375,456

-71

-71

-71

34,92524,571

ProfitPurchase of treasury
stock
Disposal of treasurystock
Net changes of items
other than shareholders’equityTotal changes of items
during the period
Balance at the end ofcurrent period

5,471,813-378-30,364-30,364

24,192-30,364

34,853

223,762-30,364-30,364-378

193,019-1,575,325

5,695,575

4,145

4,145

-

5,699,721

10

FY 2021 (from January 1, 2021 to December 31, 2021)(Thousand yen)
Shareholders’ equity

Capital surplus

Balance at the beginningof current period
Changes of items during
the period
Provision of generalreserve
Dividends of surplus

Capital
stock

Legal
capitalsurplus

OthercapitalsurplusTotal
capitalsurpluses

1,093,000

2,171,308

694,4212,865,729

Retained earnings
Other retained earnings
Retained Total retained
Generalearnings
earnings
brought
reserveforward2,800,000

512,171

3,312,171

200,000-200,000--188,817-188,817

376,057

376,057

ProfitPurchase of treasury
stock
Disposal of treasurystock
Net changes of items
other than shareholders’equityTotal changes of items
during the period
Balance at the end ofcurrent period

8,502

8,502

-

-

8,502

8,502

200,000-12,759

187,240

1,093,000

2,171,308

702,924

2,874,232

3,000,000

499,4113,499,411

Valuation and translation
adjustments
Subscription
Valuation
Total valuation rights to shares
Total
difference onand translation
shareholders’available-foradjustments
equitysale securities

Shareholders’ equity
Treasurystock
Balance at the beginningof current period
Changes of items during
the period
Provision of generalreserve
Dividends of surplus-1,575,325

4,145

4,145

-

5,699,721---188,817-188,817

376,057

376,057-57,158-57,158-57,158

62,747

71,25071,250

ProfitPurchase of treasury
stock
Disposal of treasurystock
Net changes of items
other than shareholders’equityTotal changes of items
during the period
Balance at the end ofcurrent period

5,695,575

Total net
assets13,833

13,833

13,833

5,589

201,332

13,833

13,833-215,166-1,569,735

5,896,907

17,97917,979-5,914,887

11

(4)

Non-consolidated Statements of Cash FlowsFY 2020(from January 1, 2020 to
December 31, 2020)
Amount(thousand yen)

FY 2021(from January 1, 2021 to
December 31, 2021)
Amount(thousand yen)

Profit before income taxes

625,183

625,921

Depreciation and amortization

106,121112,202-3,000-17,054-19,198

2,269

3,268

-

-1,067

Loss on retirement of property, plant and equipment

1,193

732

Loss on construction compensation

4,900

-

Payments

16,241---1,24033,143

5,568--38,545-395,268-56,572

Increase/decrease in costs on uncompleted services

4,409

-447

Increase/decrease in notes and accounts payable―trade96,874-27,244

Increase/decrease in advances received on uncompleted
services-196,835-31,012

Increase/decrease in provision for bonuses

-329

164

Increase/decrease in provision for loss on order received

2,538

8,707

Increase/decrease in provision for share benefit

3,488

1,673

Increase/decrease in provision for retirement benefits-30,226-25,877

Other-32,610-49,702

Subtotal

224,040

510,328

Interest and dividends income received

17,08419,198Interest expenses paid

-2,269-3,268--35,632

Income taxes paid

-340,886-208,205

Net cash provided by (used in) operating activities-102,030

282,420

Category
Cash flows from operating activities

Increase/decrease in allowance for doubtful accounts
Interest and dividends income
Interest expenses
Reversal of loss on construction compensation

Loss (gain) on sales of investment securities
Loss (gain) on valuation of investment securities
Loss (gain) on redemption of investment securities
Increase/decrease in notes and accounts
receivable―trade

Loss on construction compensation paid12

FY 2020(from January 1, 2020 to
December 31, 2020)
Amount(thousand yen)

FY 2021(from January 1, 2021 to
December 31, 2021)
Amount(thousand yen)

Purchase of property, plant and equipment-16,211-15,540

Purchase of intangible assets-54,453-45,981

Purchase of investment securities-200,000-310,000-

100,862

Proceeds from redemption of investment securities

200,000

400,040

Payments for lease and guarantee deposits-3,107-3,824

937

478

4,607

-5,132-68,228

120,900-31,890-38,663-71-57,158

Proceeds from disposal of treasury stock-

57,120

Proceeds from exercise of share options

11,550-Cash dividends paid

-176,194-188,817

Net cash used in financing activities-196,605-227,519

-180

468

Net increase/decrease in cash and cash equivalents-367,045

176,270

Balance of cash and cash equivalents at beginning of theyear

3,027,137

2,660,092

Balance of cash and cash equivalents at end of the year

2,660,092

2,836,362

Category
Cash flows from investing activities

Proceeds from sales of investment securities

Proceeds from collection of lease and guarantee
deposits
Other
Net cash provided by (used in) investing activities
Cash flows from financing activities
Repayments of lease obligations
Purchase of treasury stock

Effect of exchange rate change on cash and cash
equivalents

13

(5)

Notes regarding the Non-consolidated Financial Statements(Matters Affecting the Assumption of a Going Concern)
No applicable items.

(Segment Information)[Segment Information]
Previous fiscal year (from January 1 to December 31, 2020) and fiscal year under review (from January 1 to
December 31, 2021)
Since the Company’s business operations comprising engineering consulting and related services are conductedwithin a single business segment, segment information is omitted.
(Profit and Loss under Equity Method)
All group affiliates owned by the Company are deemed insignificant group companies by earnings and surplus
standards, and therefore their figures are not shown.
(Per Share Information)

FY 2020(from January 1, 2020 to
December 31, 2020)¥975.92¥64.53¥64.51

Net assets per share
Profit per share
Diluted profit per share

FY 2021(from January 1, 2021 to
December 31, 2021)¥1,009.67¥64.38¥-

Note: 1. Diluted profit per share for the fiscal year under review is not stated because no dilutive shares existed.
Note: 2. The basis for calculating profit per share and diluted profit per share is as follows:
FY 2020
FY 2021(from January 1, 2020 to(from January 1, 2021 to
December 31, 2020)
December 31, 2021)
Profit per share
Profit for the period (thousand yen)Amount not attributed to common shareholders(thousand yen)
Profit attributable to owners of parent attributed tocommon stock (thousand yen)
Average number of common stock outstanding for theperiod (shares)

375,456

376,057--

375,456

376,057

5,818,511

5,841,597

-

-

1,889

-

(1,889)(-)--

Diluted profit per share
Profit adjustment (thousand yen)
Increase in number of common stock (shares)(of which, the amount of subscription rights to shares)(shares)
Overview of dilutive shares not included in thecalculation of diluted profit per share because of theiranti-dilutive effect14

Note: 3. The basis for calculation of net assets per share is as follows:
FY 2020(from January 1, 2020 to
December 31, 2020)
Net assets for the period (thousand yen)
5,699,721
Deduction amount from total net assets (thousand yen)
Net assets attributed to common stock (thousand yen)
Closing number of common stock used in the calculationof net assets per share (shares)

FY 2021(from January 1, 2021 to
December 31, 2021)
5,914,887--

5,699,721

5,914,887

5,840,359

5,858,227

The Company’s shares held in trust that are recognized as treasury stock within shareholders’ equity areincluded in the treasury stock deducted from the calculation of the average number of shares outstanding during theperiod, used for calculating profit per share (78,769 shares as of December 31, 2020; 80,984 shares as of December
31, 2021).
The Company’s shares held in trust that are recognized as treasury stock within shareholders’ equity areincluded in the treasury stock deducted from the number of shares outstanding at end of the period, used for
calculating “net assets per share” (60,200 shares as of December 31, 2020; 102,300 shares as of December 31,2021).
(Significant Subsequent Events)
No applicable items.

15