Updated: November 20, 2023

Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
November 11, 2023
Listed company name:

Systemsoft Corporation

Listing

Tokyo Stock Exchange

Code number

7527

URL:

https://www.systemsoft.co.jp/

Representative

President and Representative Director: Haruki Yoshio

Contact person

General Manager, Administration Division: Yasunori Tomita, (TEL) +81 (0)92-732-1515

Scheduled date of the Ordinary General Meeting of Shareholders: December 20, 2023
Scheduled date to file annual securities report: December 20, 2023
Scheduled start date to commence dividend payments: Preparation of supplementary materials on annual financial results: Yes
Holding of annual financial results briefings: Yes

1.

(Yen amounts are rounded down to millions, unless otherwise noted.)
Consolidated Financial Results for the fiscal year ended September 30, 2023
(from October 1, 2022 to September 30, 2023)(1)

Consolidated financial results (cumulative)(% is Year-on-year rate of increase / decrease)
Net sales

Fiscal year ended

Net income attributable toowners of parent

Ordinary income

million yen%

million yen%

million yen%

million yen

%

3,390

-27.9

155

-59.5

135

-64.1

93

-53.4

4,704

-4.4

382

1.3

377

10.0

201

-58.4

September 30, 2023
September 30, 2022
Note: Comprehensive income

Operating income

For the fiscal year ended, September 30, 2023 ¥86 million (-27.3%)
For the fiscal year ended, September 30, 2022 ¥119 million yen (-74.7%)
Net earnings
per share

Diluted net earnings
per share

Return on equity

Ratio of ordinary
income to total
assetsRatio of operating
profit to net sales

yen

%

%

%

Fiscal year ended

yen

September 30, 2023

1.10

―

1.6

1.9

4.6

September 30, 2022

2.37

2.37

3.5

5.1

8.1

(2)

Consolidated financial condition
Total assets

Fiscal year ended

September 30, 2023
September 30, 2022
Reference: Shareholders’ equity(3)

Net assets

Shareholders’ equity ratio

Net assets per share

million yen

million yen

%

yen

6,742

5,782

85.3

67.79

7,224

5,865

80.7

68.79

As of September 30, 2023 ¥5,748 million
As of September 30, 2022 ¥5,833 million

Consolidated Cash Flows

million yen

million yen

million yen

Cash and cash
equivalents at
end of period
million yen

253

-61

-379

1,762

168

-195

-104

1,949

Cash flows fromoperating activities
Fiscal year ended

September 30, 2023
September 30, 2022

Cash flows frominvesting activities

1

Cash flows fromfinancing activities

Updated: November 20, 2023

2.

Cash dividends
Annual dividends per share
First
SecondThird
quarter-end quarter-end quarter-end

Fiscalyear-end

Total cash
dividends(Total)Total

Payout ratio(Consolidated)

Ratio ofdividends to
net assets(Consolidated)

Fiscal year ended

yen

yen

yen

yen

yen

million yen%%

September 30,
2022

―

0.00

―

2.00

2.00

169

75.1

2.9

September 30,
2023

―

0.00

―

0.00

0.00

―

―

―

―

―

―

―

―

September 30,
2024 (Forecast)―

Note: The source of dividends for the fiscal years ended September 30, 2022 is entirely capital surplus.
For details, please refer to "Breakdown of dividends using capital surplus as the source of dividends" below.
The dividend for the fiscal year ending September 30, 2024 is undetermined at this time.

3.

Forecast of consolidated financial results for the fiscal year ending September 30, 2024
(October 1, 2023 – September 30, 2024)(% increase or decrease from the previous year)
Net sales

Operating income

Ordinary income

Profit attributable toowners of parent

Net income per
sharemillion yen%

million yen%

million yen%

million yen

%

yen

3,000

-11.5

130

-16.2

110

-18.6

65

-30.6

0.76

Full-year* Notes(1) Changes in significant subsidiaries during the quarterly consolidated financial statements period: None
(2) Changes in accounting policies, changes in accounting estimates, and restatement(i) Changes in accounting policies due to revisions to accounting standards and other regulations: Yes(ii) Changes in accounting policies due to other reasons: None(iii) Changes in accounting estimates: None(iv) Restatement: None
(Note) For details, please refer to "3. Consolidated Financial Statements and Key Notes (5) Notes on consolidated
financial statements " on page 16 of the attached materials.
(3) Number of issued shares (common shares)(i) Total number of issued shares at the end of the period (including treasury shares)
As of September 30, 2023

84,834,140 shares

As of September 30, 2022

84,834,140 shares(ii) Number of treasury stock shares at the end of the period
As of September 30, 2023

32,067 shares

As of September 30, 2022

31,987 shares(iii) Average number of shares outstanding during the period
Fiscal year ended September 30, 2023

84,802,087 sharesFiscal year ended September 30, 2022

84,708,524 shares

2Updated: November 20, 2023

Reference: Summary of Non-Consolidated Financial Results1.

Non-Consolidated Financial Results for the fiscal year ended September 30, 2023
(from October 1, 2022 to September 30, 2023)(1)

Non-Consolidated financial results(% is Year-on-year rate of increase / decrease)
Net Sales

Fiscal year ended

Operating Income

Ordinary income

Net income

million yen%

million yen%

million yen%

million yen

%

2,433

-16.4

-89

―

-109

―

-123

―

2,909

-2.9

34

―

224

79.0

73

―

September 30, 2023
September 30, 2022

Net income per share

Diluted net income per
share

Fiscal year ended

yen

September 30, 2023

-1.45

―

0.87

0.86

September 30, 2022

yen(2) Non-Consolidated financial condition
Total Assets
Fiscal year ended

Net Assets

Shareholders’ equity ratio

Net assets per share

million yen

million yen

%

yen

6,037

5,290

87.2

62.10

6,642

5,579

83.6

65.51

September 30, 2023

September 30, 2022
Note: Shareholders’ Equity: As of September 30, 2023
As of September 30, 2022

¥5,266 million¥5,555 million*Financial Results reports are exempt from annual review conducted by certified public accountants or an audit corporation.
*Proper use of earnings forecasts, and other special matters
Forward-looking statements, such as each business outlook, described in this document are based on information currently
obtained by the Company and certain assumptions that it deems reasonable, and are not to the effect that the Company
promises to achieve such results. Actual results may differ materially due to various factors.
Please refer to "1. Summary of Business Results, etc. (4) Outlook for the future" on page 7 of the attached document forthe conditions that form the assumptions for business forecasts and cautions concerning the use of business forecasts.

Breakdown of dividends using capital surplus as the source of dividends
The following is a breakdown of the dividends for the fiscal year ended September 30, 2022, for which capital surplus isused as the source of dividends.
Reference date

End of term

2 yen 00 sen

2 yen 00 sen

169 million yen

169 million yen

Dividend per share
Total amount of dividends

Total

Note: Ratio of decrease in net assets: 0.032

3

Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023

Table of Contents
1. Summary of Business Results, etc.

5(1) Summary of business results for the fiscal year ended September 30, 2023 ·················································· 5(2) Summary of financial condition ············································································································ 6(3) Summary of cash flows for the fiscal year ended September 30, 2023 ························································· 6(4) Outlook for the future ························································································································· 7
2. Basic approach to the selection of accounting standards

7

3. Consolidated Financial Statements and Key Notes

8(1) Consolidated Balance Sheet ··············································································································· 8(2) Consolidated Statements of Income and Consolidated Comprehensive Income Statements ···························· 10(3) Consolidated Statement of Changes in Shareholders’ equity ····································································· 12(4) Consolidated Statements of Cash Flows ······························································································· 14(5) Notes on consolidated financial statements ··························································································· 16(Notes on going concern assumptions) .................................................................................................................. 16(Change in accounting policy)................................................................................................................................. 16(Segment Information, etc.) .................................................................................................................................... 16(Per share information) ........................................................................................................................................... 19(Significant subsequent events) .............................................................................................................................. 194

Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023

1. Summary of Business Results, etc.
(1) Summary of business results for the fiscal year ended September 30, 2023
During the fiscal year ended September 30, 2023 (October 1, 2022 to September 30, 2023), the Japanese economy
showed signs of a pickup in personal consumption due to the reclassification of COVID-19 infections and a recovery in
inbound demand. On the other hand, there are still concerns about the impact on the domestic economy due to soaring
prices of resources, raw materials, and energy caused by prolonged geopolitical risks from Ukraine and Israel, and therisk of a downturn in the overseas economy due to higher interest rates associated with global inflation, in addition torising prices due to the weak yen, etc. The outlook remains uncertain.
In the information services industry, to which our group belongs, the DX movement is spreading at an accelerated
pace due to progress in new fields such as AI, IoT, and RPA, and this trend is expected to continue. In particular, it isexpected that the use of AI, which has made remarkable progress, in business will expand. In the Post Pandemic societyof the future, digitalization will become even more important, and solid IT investments are expected to continue.
On the other hand, securing and training on-site engineers and field workers due to the chronic shortage of humanresources is a major issue, and the market environment remains severe, including soaring costs.

In this environment, the Company is focusing on proactive recruitment and training of quality engineers, and is working
to provide SaaS products and improve the value of services in the overall system development field.
In addition, the Company aims to create new value and increase corporate value by offering DX areas, RPA solutions,open innovation, and adding consulting services such as alliance services and FA (financial advisory).
As a result, net sales for the consolidated fiscal year ended September 30, 2023 decreased by 1,313 million yen(27.9%) year on year to 3,390 million yen, and operating income decreased 227 million yen (59.5%) year on year to 155
million yen. Ordinary income decreased 241 million yen (64.1%) year on year to 135 million yen, and net income
attributable to owners of the parent decreased 107 million yen (53.4%) year on year to 93 million yen.

Segment results are as follows.
(i) Technology businessWith its strength in systems development based on web technology, the company has been providing systemdevelopment and solution services to clients in the real estate, information and telecommunications, life and non-life
insurance, and education fields for many years. In addition to the operation of rental real estate information websites, we
also focus on providing SaaS, including RPA solution services and the SS Cloud series.
In the fiscal year ended September 30, 2023, although ongoing projects remained steady, the increase in staffing fell
short of plans due to a shortage of human resources, and there were delays in large-scale projects in systemdevelopment.
As a result, net sales in the technology business decreased 919 million yen (27.5%) year on year to 2,429 million yen,and segment income decreased 98 million yen (29.1%) year on year to 238 million yen.
(ii) Open Innovation BusinessWe provide consulting services to start-up companies on business launches and other matters, incorporating
technologies and ideas from different industries and fields, and provide a platform for innovation.
In the fiscal year ended September 30, 2023, both net sales and segment income decreased, partly because someconsulting projects were postponed to the next fiscal year or later.
As a result, net sales in the open innovation business decreased 422 million yen (30.5%) year on year to 961 million
yen, and segment income decreased 159 million yen (75.8%) year on year to 50 million yen.

5

Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023(iii) Other businessSubsidiary S2i Inc. is in the business of providing IoT-related products and services.
There were no sales from other businesses (sales of 0 million yen in the same period of the previous year). Segment
loss was 0 million yen (segment loss of 0 million yen in the same period of the previous year).

(2) Summary of financial condition
Assets, Liabilities and Net Assets
Current assets as of the fiscal year ended September 30, 2023 were 3,610 million yen, down 384 million yen from theend of the previous consolidated fiscal year. This was mainly due to a decrease of 186 million yen in cash and deposits
and a decrease of 258 million yen in notes and accounts receivable-trade and contract assets.
Fixed assets decreased by 98 million yen from the end of the previous fiscal year to 3,131 million yen. This was mainly
due to a 40 million yen decrease in goodwill and a 52 million yen decrease in investment securities.
As a result, total assets decreased by 482 million yen to 6,742 million yen.
Current liabilities decreased 176 million yen to 599 million yen. This was mainly due to a 38 million yen decrease innotes and accounts payable-trade and a 66 million yen decrease in income taxes payable.
Fixed liabilities decreased by 222 million yen to 360 million yen. This was mainly due to a decrease of 100 million yen
in bonds payable and a decrease of 110 million yen in long-term loans payable.
As a result, total liabilities decreased by 399 million yen from the end of the previous consolidated fiscal year to 959
million yen.
Total net assets decreased 83 million yen to 5,782 million yen. The equity ratio was 85.3%, mainly due to a decreasein capital surplus resulting from the payment of dividends from capital surplus and an increase in retained earnings
resulting from the recording of net income attributable to owners of the parent.

(3) Summary of cash flows for the fiscal year ended September 30, 2023
Cash and cash equivalents (hereinafter referred to as "cash") for the fiscal year ended September 30, 2023 decreased
186 million yen from the fiscal year ended September 30, 2022 to 1,762 million yen.
The status of each cash flow and their factors during the fiscal year ended September 30, 2023 are as follows.
(Net cash provided by (used in) operating activities)
Net cash increase in operating activities totaled 253 million yen, compared to a 168 million yen increase during thelast fiscal year. This was mainly due to a 76 million yen increase in accounts payable and a 24 million yen decrease in
consumption tax payable.
(Net cash provided by (used in) investing activities)
Net cash used in investing activities totaled 61 million yen, compared with 195 million yen used in the same period of
the previous fiscal year. This was mainly due to a 48 million yen decrease in proceeds from sales of investment securities
and a 150 million yen decrease in purchase of investments in subsidiaries resulting in change in scope of consolidation.
(Net cash provided by (used in) financing activities)
Net cash used in financing activities amounted to 379 million yen, compared with 104 million yen used in the same
period of the previous year. This was mainly due to a 100 million yen increase in expenditures for repayment of longterm loans payable and a 73 million yen decrease in proceeds from issuance of stock due to exercise of stock acquisitionrights.

6

Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023

(4) Outlook for the futureWith the goal of "driving DX in society through IT technology and innovation," our group is working to become acompany that creates new value through the fusion of technology and open innovation.
As for the technology business, although the firm demand for IT engineers is expected to continue, the scale ofdevelopment has been reduced due to the change of a part of the system development business to consulting in thefiscal year ended September 30, 2023.
Regarding the SS Cloud series in the SaaS business, the number of users is steadily increasing, but we are cautiously
projecting the timing and scope of fee-based services.
Based on these circumstances, the Company forecasts net sales of 3,000 million yen, operating income of 130 million
yen, ordinary income of 110 million yen, and net income attributable to owners of the parent of the Company of 65 million
yen for the next fiscal year.

The above forecasts are based on information currently available to the Company and certain assumptions that are
judged to be reasonable, and are not intended to be a promise by the Company that they will be achieved. Actual results
may differ significantly due to various factors.

2. Basic approach to the selection of accounting standards
Our Group prepares its consolidated financial statements in accordance with Japanese GAAP, as it does not engage
in international business development or fundraising.

7

Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023

3. Consolidated Financial Statements and Key Notes(1) Consolidated Balance SheetASSETS
Current assets(Unit: thousand yen)
Fiscal year ended
September 30, 2023

Fiscal year ended
September 30, 2022

Cash and deposits

1,949,892

1,762,904

1,547,341

1,288,811

35,04923,36239

27

Prepaid expenses

200,236

128,726

Other

292,168

436,741

Allowance for doubtful accounts-30,084-30,084

3,994,644

3,610,489

Property, plant and equipment (net)32,97632,680Tools, equipments and fixtures (net)

14,15911,677

Total tangible fixed assets

47,13544,358Goodwill

2,069,524

1,935,038

Business right

170,340

130,260

Software

94,064

61,763

Other

77,31376,982

2,411,242

2,204,045

Investment securities

409,531357,213

Stocks of subsidiaries

137,698

137,698

122,984

237,612

12,59478,617

Deferred tax assets

51,89735,173

Other

37,07637,076

Total investments and other assets

771,782

883,390

3,230,160

3,131,793

7,224,804

6,742,282

Notes, accounts receivable and contract
assetsWork in progress
Raw materials and stored products

Total current assets
Fixed assets
Tangible fixed assets

Intangible fixed assets

Total intangible assets
Investments and other assets

Other securities of subsidiaries andaffiliates
Long-term prepaid expenses

Total fixed assets
Total assets

8Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023

LIABILITIES(Unit: thousand yen)
Fiscal year ended
September 30, 2023

Fiscal year ended
September 30, 2022

Current liabilities
Notes and accounts payable

181,058

142,624

Bonds due within one year

100,000

100,000

Long-term debt due within one year

120,000

120,000

Accounts payable

99,822131,009

Accrued expenses

11,657

15,054

Income taxes payable

84,827

18,729Accrued consumption tax, etc.

43,435

11,299Advance received

8,990

13,824

Other

126,058

46,913

Total current liabilities

775,849

599,454

Corporate bonds

280,000

180,000

Long-term debt

170,000

60,000Long-term accrued liabilities

115,741

105,408

Asset retirement obligations

10,176

10,207

Fixed liabilities

Other

7,372

4,754

583,290360,370

1,359,140

959,824

Capital stock

1,706,476

1,706,476

Capital surplus

3,712,343

3,542,739

Retained earnings

522,094

615,690

Treasury stock-8,078-8,086

5,932,836

5,856,819

1,675

5,684

-101,032-113,622-99,357-107,937

24,51923,948

7,665

9,627

5,865,664

5,782,458

7,224,804

6,742,282

Total fixed liabilities
Total liabilities
EquityShareholders' equity

Total shareholders' equity
Accumulated other comprehensive income(loss)
Valuation difference on available-for-salesecurities
Foreign currency translation adjustments
Total accumulated other comprehensive
income (loss)
Stock acquisition rights
Non-controlling interests
Total net assets
Total liabilities and net assets

9Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023

(2) Consolidated Statements of Income and Consolidated Comprehensive Income Statements
Consolidated statement of income

Sales(Unit: Thousand yen)
Fiscal year ended
September 30, 2023

Fiscal year ended
September 30, 2022

Cost of sales

4,704,404
3,367,906

3,390,566
2,405,611

Gross profit

1,336,498

984,954

Selling, general and administrative expenses

953,761

829,803

Operating income

382,736

155,151

Non-operating income
Interest income

278

10

Dividend received
Foreign exchange gains

3,404
88,205643
13,183

Subsidy income
Consulting revenue

3,316
1,250

7,760
―

Other

726

541

97,18022,13817,438―12,087279

16,753912

17,251558

20,000
520

400
―

Other

24,68622,493―
11,498

Total non-operating expenses

102,803

42,075377,113135,214

4,464

19,709

―

570

4,464

20,2809,804

680

Loss on impairment of fixed assets
Loss on sales of investment securities

12,063
3,063――

Loss on valuation of investment securities
Loss on store closing

1,313
31,470―4,736

Total extraordinary loss

57,714

5,417

323,864

150,078

111,697

39,566

Total non-operating income
Non-operating expenses
Interest expenses
Loss on valuation of investment securities
Payment fees
Consumption tax difference
Donation
Reorganization costs
Allowance for doubtful accounts

Ordinary income
Extraordinary gains
Gain on sales of investment securities
Gain on reversal of subscription rights tosharesTotal extraordinary gains
Extraordinary loss
Loss on retirement of fixed assets

Net Income before taxes or net loss before
adjustments to taxes, etc
Corporate tax, municipal tax and business
taxes
Adjustment to corporate taxes, etc

11,384

14,955

Total income taxes

123,081

54,521

Net income

200,782

95,556

-234

1,961

201,017

93,595

Net income (loss) attributable tononcontrolling interests
Net income attributable to owners of parent
or net loss attributable to owners of parent

10

Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023

Consolidated statements of comprehensive income(Unit: Thousand yen)
Fiscal year ended
September 30, 2023

Fiscal year ended
September 30, 2022

Net income
Other comprehensive income
Valuation difference on available-for-salesecurities
Exchange conversion adjustment accountTotal other comprehensive income
Comprehensive income(Breakdown)Comprehensive income for ownersof parent
Comprehensive income fornon-controlling shareholders

11

200,782

95,556

4,198

4,009

-85,289-12,589-81,091-8,579119,691

86,977

119,926

85,015

-234

1,961

Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023

(3) Consolidated Statement of Changes in Shareholders’ equity
Fiscal year ended September 30, 2022 (October 1, 2021 to September 30, 2022)(Unit: thousand yen)

Shareholders' equity
Capital stock

Capital surplus

Retained earnings

Treasury stock

Total shareholders'equity3,879,259

278,103-8,064

5,813,203

1,663,904

Balance at the beginning of the period
Cumulative effect of a change inaccounting policy
Balance at beginning of the period
reflecting change in accounting policy

1,693
279,797

1,693

1,663,904

3,879,259-8,064

5,814,897

42,571

42,57185,143-168,208-168,208

Changes during the period
Exercise of stock acquisition rights
Dividends from surplus
Net income attributable to owners of
the parent

201,017

201,017-13

Acquisition of treasury stock
Transfer from capital surplus toretained earnings
Changes in items other thanshareholders' equity (net)Total changes of items during theperiodBalance at the end of the period-13-41,279

41,279―42,571-166,916

242,297-13

117,939

1,706,476

3,712,343

522,094-8,0785,932,836

Non-controllinginterests

Total net assets

7,900

5,838,523

Accumulated other comprehensive income

Balance at the beginningof the period
Cumulative effect of achange in accounting
policyBalance at beginning of
the period reflectingchange in accounting
policyChanges during theperiodExercise of stockacquisition rights
Dividends fromsurplus
Net income
attributable to ownersof the parent
Acquisition of treasury
stock
Transfer from capitalsurplus to retained
earnings
Changes in items
other thanshareholders' equity(net)
Total changes of items
during the period
Balance at the end of theperiodOther
Stock acquisition
Valuation
Foreign exchange
comprehensive
rightsdifference on
conversion
incomeother securities
adjustments
cumulative total-2,523-15,743-18,266

35,686

1,693-2,523-15,743-18,266

35,6867,900

5,840,217

85,143-168,208
201,017
-13
―

4,198

-85,289-81,091-11,166-234-92,492

4,198-85,289-81,091-11,166-234

25,446

1,675-101,032-99,357

24,5197,665

5,865,664

12

Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023

Fiscal year ended September 30, 2023 (October 1, 2022 to September 30, 2023)(Unit: thousand yen)

Shareholders' equity

Balance at the beginning of the period

Capital stock

Capital surplus

1,706,476

3,712,343

Retainedearnings
522,094

Treasury stock

Total
shareholders'equity-8,0785,932,836

Changes during the period-169,604

Dividends from surplus
Net income attributable to shareholdersof the parent company-169,604
93,595Acquisition of treasury stock

93,595-8-8

Changes in items other thanshareholders' equity (net)Total changes of items during the period
Balance at the end of the period―-169,604

93,595-8-76,017

1,706,476

3,542,739

615,690-8,086

5,856,819

Accumulated other comprehensive income

Balance at the
beginning of the period
Changes during theperiodDividends fromsurplus
Net income
attributable toshareholders of theparent company
Acquisition oftreasury stock
Changes in items
other thanshareholders' equity(net)
Total changes of items
during the period
Balance at the end of
the period

Other
Stock acquisition Non-controlling
Valuation
Foreign currency
comprehensive
rightsinterests
difference ontranslation
incomeother securities
adjustments
Cumulative total
1,675-101,032-99,357

24,519

7,665

Total net assets

5,865,664-169,604
93,595-8
4,009-12,589-8,579

-570

1,961

-7,1894,009-12,589-8,579

-570

1,961

-83,206

5,684-113,622-107,937

23,9489,627

5,782,458

13

Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023

(4) Consolidated Statements of Cash Flows(Unit: thousands of yen)
Fiscal year ended
September 30, 2023

Fiscal year ended
September 30, 2022

Cash flow from operating activities
Net income before income taxes and minority
interests
Depreciation
Impairment loss
Amortization of goodwill
Increase (decrease) in allowance for doubtful
accounts
Increase (decrease) in allowance for loss on order
received
Interest and dividends income
Interest expense
Loss on disposal of fixed assets
Loss (gain) on sales of securities
Loss (gain) on valuation of securities
Loss on store closures
Gain on reversal of subscription rights to shares(Increase) decrease in trade receivables andcontract assets(Increase) decrease in inventories
Increase (decrease) in notes and accounts
payable-trade
Increase (decrease) in accounts payable-other
Increase (decrease) in accrued consumption
taxes
Foreign exchange loss (gain)
Other
SubtotalInterest and dividends received

323,864

150,078

125,055

94,035

12,063
130,592―
134,485

24,686―-4,929―-3,682
17,438-653
12,0879,804-1,401680-19,709

1,313
31,470

279
4,736

―

-570

131,386

258,530

90,098

11,699-255,234-38,433-44,920

31,186-31,375-32,136-88,205-150,985-13,183-207,948

317,038

385,164

10,4702,664-14,495

Amount of interest paid
Income taxes paid or refunded (paid)-14,518-144,484-119,638

Cash flow from operating activities

168,505

253,695-16,564-8,360―-29,95876-9,532-160,000
162,779-157,500
113,885-2,400414―
360-150,000―-195,729-61,070

Cash flow from investment activities
Payments for acquisition of tangible fixed assets
Proceeds from sales of tangible fixed assets
Payments for acquisition of intangible fixed assets
Payments for acquisition of investment securities
Proceeds from sales of investment securities
Payments for loans receivable
Proceeds from collection of loans receivable
Payments for acquisition of shares of nonconsolidated subsidiaries
Cash flow from investment activities

14

Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023

(Unit: Thousand yen)
Fiscal year ended
September 30, 2023

Fiscal year ended
September 30, 2022

Cash flow from financial activities
Repayment of short-term borrowings-200,000

Proceeds from long-term debt
Repayment of long-term debt

300,000-10,000

Payments for redemption of bonds
Dividends paid

-100,000-168,208

Proceeds from issuance of shares upon exerciseof stock acquisition rights
Other73,977

Cash flow from financial activities
Increase (decrease) in cash and cash equivalents――-110,000-100,000-169,604
―

-13

-8

-104,244-379,612-131,468-186,987

Cash and cash equivalents at beginning of period

2,081,361

1,949,892

Cash and cash equivalents at end of period

1,949,892

1,762,904

15

Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023

(5) Notes on consolidated financial statements(Notes on going concern assumptions)
Nothing applicable.

(Change in accounting policy)(Application of Accounting Standard for Measurement of Fair Value, etc.)
The "Guidance on Accounting Standard for Measurement of Fair Value" (ASBJ Guidance No. 31, June 17, 2021;
hereinafter referred to as "Guidance on Accounting Standard for Measurement of Fair Value") The "Guidance on
Accounting Standard for Measurement of Fair Value" (ASBJ Guidance No. 31, June 17, 2021) The new accounting policy
prescribed by the "Guidance on Accounting Standard for Measurement of Fair Value" (ASBJ Guidance No. 31, June 17,2021) is applied from the beginning of the fiscal year ended September 30, 2023, and the new accounting policy
prescribed by the Guidance is applied prospectively in accordance with the transitional treatment prescribed in Paragraph27-2 of the Guidance on Accounting Standard for Measurement of Fair Value. There is no impact on the consolidated
financial statements.

(Segment Information, etc.)[Segment Information]
1 Outline of reportable segments
The Company's reportable segments are components of the Company for which separate financial information isavailable and are subject to periodic review by the Board of Directors for the purpose of determining the allocation ofmanagement resources and evaluating performance.
The Company formulates comprehensive strategies for each of its major services, and its divisional units (units) areresponsible for managing these strategies and developing business activities.
Therefore, the Company consists of two reportable segments, "Technology Business" and "Open Innovation
Business," which are organized by major services.
The Technology Business mainly provides system development and solution services. The "Open Innovation
Business" provides consulting services to startup companies for business launches, etc. and operates shared offices toprovide a place for innovation.
2 Calculation method for the amount of net sales, profit or loss, assets, liabilities and other items by reportable segment
The accounting methods used for the reported business segments are generally the same as those used in the
preparation of the consolidated financial statements. Profits of reportable segments are based on operating income.
Intersegment revenues and transfers are based on prevailing market prices.

16

Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023

3 Information on net sales, income or loss, assets and other items by reportable segment
Fiscal year ended September 30, 2022 (October 1, 2021 to September 30, 2022)
Information on net sales, income or loss, assets and other items by reportable segment(Unit: thousand yen)
Reporting Segment
Open
Innovation
Business

Technology
business

Other*

Total

Subtotal

Sales
Sales to external customers

3,348,406

1,355,998

4,704,404―

4,704,404

Sales or transfers inside or
between segments

1,006

28,095

29,101―

29,101

Subtotal

3,349,412

1,384,093

4,733,505―

4,733,505

Segment profit or Loss

336,967

210,387

547,354-314

547,039

Segment assets

4,430,699

2,003,508

6,434,208

16,2996,450,508

Depreciation and amortization

97,48023,130120,611―

120,611

Increase in tangible fixed assets
and intangible fixed assets

16,521

18,22434,745―34,745

Other items

Note: *"Other" refers to business segments not included as reporting segments.

Fiscal year ended September 30, 2023 (October 1, 2022 to September 30, 2023)
Information on net sales, income or loss, assets and other items by reportable segment(Unit: thousand yen)
Reporting Segment
Open
Innovation
Business

Technology
Business

Other*

Total

Total

Sales
Sales to external customers

2,429,624

960,9423,390,566―

3,390,566

Sales or transfers inside or
between segments

―

318

318

―

318

Subtotal

2,429,624

961,260

3,390,884―

3,390,884

Segment profit or Loss

238,91550,896

289,811-363

289,448

Segment assets

3,858,121

1,980,961

5,839,082

15,766

5,854,849

Depreciation and amortization

64,186

22,763

86,950―86,950

Increase in tangible fixed assets
and intangible fixed assets

1,245

7,620

8,866

―

8,866

Other items

Note: *"Other" refers to business segments not included as reporting segments.

17

Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023

4 Difference between the total amount of reportable segments and the amount recorded in the consolidated financial
statements, and main contents of the difference (matters related to difference adjustment)(Unit: thousand yen)
Sales

Fiscal year ended September 30, 2022

Fiscal year ended September 30, 2023

Total of reportable segments

4,733,505

3,390,884

Net sales in "Other" segment――-29,101-318

4,704,404

3,390,566

Elimination of inter-segment
transactions
Net sales in consolidated financial
statements(Unit: thousand yen)
ProfitFiscal year ended September 30, 2022

Fiscal year ended September 30, 2023

547,354289,811

-314

-363

Corporate expenses*-164,303-134,297

Operating income in consolidated
financial statements

382,736

155,151

Total of reportable segments
Profit in "Other" category

Note: ”Corporate expenses” are mainly general and administrative expenses that do not belong to any particular reportable segment.
(Unit: thousand yen)assetsFiscal year ended September 30, 2022

Fiscal year ended September 30, 2023

Total of reportable segments

6,434,208

5,839,082

Assets in the "Other" category

16,29915,766

Corporate assets*

774,296

887,433

Total assets in consolidated financial
statements

7,224,804

6,742,282

Note: ”Corporate assets” are mainly head office buildings that do not belong to any reportable segment.

Other items

Depreciation andamortization
Increase in tangible andintangible fixed assets

Total of reportablesegments

Other

Adjustment amount(Unit: thousand yen)Amount recorded inconsolidated financial
statements

Fiscal year
ended Sep
30, 2022

Fiscal year
ended Sep
30, 2023r

Fiscal year
ended Sep
30, 2022

Fiscal year
ended Sep
30, 2023r

Fiscal year
ended Sep
30, 2022

Fiscal year
ended Sep
30, 2023r

Fiscal year
ended Sep
30, 2022

Fiscal year
ended Sep
30, 2023r

120,61186,950

―

―

4,444

7,084

125,055

94,03534,745

8,866

―

―

11,777

9,026

46,522

17,89218

Systemsoft Corporation (7527) Consolidated Financial Results for the Fiscal Year Ended September 30,2023(Under Japanese GAAP)
Updated: November 11, 2023

(Per share information)
Fiscal year ended
September 30, 2022

Fiscal year ended
September 30, 2023

Net assets per share

68.79 yen

67.79 yen

Net income (loss) per share

2.37 yen

1.10 yen

Net income per share after adjustment ofpotential shares

2.37 yen― yen

Note: The basis for calculating net income (loss) per share and diluted net income per share is as follows
Fiscal year ended
September 30, 2022

Fiscal year ended
September 30, 2023

(1) Net income (loss) per share(Basis for calculation)
Net income (loss) attributable to ownersof the parent (thousand yen)

201,017

93,595――

Net income (loss) attributable to ownersof the parent attributable to common
stock (thousand yen)

201,017

93,595

Average number of shares of common
stock during the period (shares)

84,708,524

84,802,087――

90,640―

Amount not attributable to commonshareholders (thousand yen)

(2) Net income per share after adjustment
for residual securities(Basis for calculation)
Adjustment of net income attributable toowners of the parent (thousand yen)
Increase in the number of common
stocks (shares)
Outline of latent shares not included in thecalculation of diluted net income per share
due to the absence of dilutive effects

Fourth series of stock acquisition
Fifth series of stock acquisitionrightsrights(Number of shares: 1,427,300 shares) (Number of shares: 1,496,800 shares)(Significant subsequent events)
Nothing applicable.

19