For Institutional Investors/Analystssts

TSE 1st section 8154

■ Forward-looking statements in these materials are based on information available to management
at the time this report was prepared and assumptions that management believes are reasonable.
Actual results may differ significantly from these statements for a number of reasons.
■ Display method in this material
Number : Truncated less than the display unit.
Ratio: After calculation in yen units, Round down one digit of Display unit.

Summary of Financial Results for the Third Quarter Ended December 31, 2018

FY2019/3 3QResults Net sales by and large maintained the same level year-on-year, driven by EMSbusiness.
 Operating income and net profit both declined, which had been factored in at thebeginning of the period.
* Causes of the decreases: production adjustments resulting from model switching at major
customers, upfront expenses of new overseas sites at their start-up phase, etc.

Overview of themain businesssegments● Electronic components: Although the EMS business for medical equipment was slow, it
remained strong for automotive and air conditioning devices. The components
sales business remained sluggish.
● Information equipment: In PC sales, although sales were strong for individuals, they
were sluggish for corporate customers. While sales in the housing-related home electric
appliances business decreased as a result of delivery date adjustments by customers,
the commercial facilities-related LED installation business continued a robust
trend.
● Given progress in line with the plan, we have left the previous forecasts (released on

November 6, 2018) unchanged. ＜ Net sales：290 billion yen, Ordinary income：8 billion yen,

Forecast forFY2019/3

Profit attributable to owners of parent：7.3 billion yen, and ROE 9.9% ＞

 Along with the acquisition of Fujitsu Electronics, consolidation is scheduled to beeffective from the forth quarter.
 Aiming to achieve record profit in 14 years with 7.3 billion yen profit projection
including negative goodwill related to the acquisition.

© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

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(Million Yen)FY2018/3

FY2019/3

3Q Results

3Q Results

YoY

Net sales

174,047

173,782-265-0.2%

Gross profit

24,242

24,023-219

-0.9％

13.9%

13.8%

-0.1ptSG&A

17,62818,275646

3.7%Operating income

6,613

5,748-864-13.1％

Ordinary income

7,093

6,000-1,093-15.4％

Profit attributableto owners of parent

5,510

4,875-635-11.5％EPS (Yen)

200.86

177.69-23-11.5％

Gross profit margin© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

3

（Million yen）

Net Sales
174,047
8,702
1,541
34,745

173,782
14,5701,943
32,374

Segment income
Total
YoY： -265

Others

Total

6,613

YoY： -864

YoY：＋5,868

236
91

5,748

Sofware

1,659

415
122

YoY： +402

1,339
Information equipment

Software
YoY： ＋30

YoY ： -320

124,893
Electronic component

4,509
3,780

YoY： -4,164

2018/3
3Q Results

YoY ： +179

Information equipment

YoY： -2,371

129,058

Others2019/3
3Q Results

2018/3
3Q Results

Electronic componetnt
YoY ： -729

2019/3
3Q Results

Note: Figures of each segment income are not inter-segment adjusted.
Total amount is inter-segment adjusted (operating income).
© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

4(Million Yen)FY2018/3

FY2019/3

3Q Results

3Q Results

YoYNet sales

57,46558,399

934

1.6%

Gross profit

8,023

8,000-22-0.3%

14.0%

13.7%

-0.3pt

SG&A

5,804

6,023

219

3.8%

Operating income

2,219

1,976-242-10.9%

Ordinary income

2,390

1,951-438-18.3％

Profit attributableto owners of parent

1,994

2,125

130

6.6%

EPS (Yen)

72.70

77.44

4.74

6.5%

Gross profit margin© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

5

（Million yen）

Net sales/Segment income
130000129,058/Net Sales/Segment Income

124,893

YoY8000

 Net Sales-4,164million yen

3.2％down Segment Income -729million yen 16.2％down
7000

1250006000

EMS business for automotive and airconditioning devices maintained a steady
performance.

1200005000

4,509
115000

3,780

4000

Components sales business remained sluggish,notably for home electric appliances from theeffect of production adjustments at majorcustomers.

1100003000

1050002000

1000001000

2018/3
3QResults© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

2019/3
3QResults

6

（Million Yen）

Net sales/Segment income

YoY Net Sales/Nets Sales/Segment Income41,000-2,371million yen 6.8％down Segment Income -320million yen 19.3％down

5600

The commercial facilities-related LED installation
business showed robust growth.
36,00034,7454600

32,37431,0003600

26,0002600

The housing-related home electric appliancebusiness declined due to delivery date adjustments
by customers. Although sales of PCs to individuals
were solid, sales of PCs to corporate customers wereslow.

1,659
1,339

21,00016,0001600

600

2018/3
3Q Results© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

2019/3
3Q Results7

(Million Yen)

Net salesYoY Japan

174,047110,643

7,015
2,985

173,782

106,358

6,237
3,234

53,403

57,952

2018/3
3Q Results

2019/3
3Q Results© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

JapanNorth America-4,284 million Yen

3.9％down

 North America-778 million Yen 11.1％down

 Europe＋249 million Yen

8.4％up East Asia

＋4,548 million Yen

8.5％upJapan: PC sales and golf equipment sales weresluggish.
Overseas: The EMS business drove growth, witha strong performance in east Asia and Europe.
In North America, Business for medicalequipment was sluggish due to model switching.

EuropeEast Asia

8

(Million Yen)

Total assets

Total liabilities and net assets

152,885

152,885
125,751

128,755
125,751

128,755

Current assets

59,819125,467
103,684

79,948

Total liabilities

58,123104,069

Non-current assets

22,067

24,68527,4182017/3

2018/3

2018/1265,932

70,631

72,9372017/3

2018/3

2018/12

Total net assets

Note: “Partial Amendments to Accounting Standard for Tax Effect Accounting” etc. (Accounting Standards Board ofJapan (ASBJ) Statement No. 28, February 16, 2018) have been adopted from the beginning of the first quarterof the fiscal year ending March 31, 2019. Accordingly, deferred tax assets are presented under investments
9© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved. and other assets, while deferred tax liabilities are presented under non-current liabilities section.

(Million Yen)

Inventories

Accounts receivable/Accounts payable

70,000

75.0

（Day）

83.6

（Day）

80,000

77.1

75.8

80.0

60,000A/R turnover

70,00065.0

70.0

50,00060,000

55.0

69.9

45.5

65.3

65.7

A/P turnover

60.0

50,00045.0

40,000

36.0

50.0

34.9

Inventory turnoverNotes and A/R

40,00035.0

40.0

30,00030,00025.0

30.0

52,00920,00015.0

10,00019,325

19,455Inventories

20,00037,55349,841
36,392

Notes and A/P

47,91835,78920.0

24,79410,000
10.0

5.0

00

0.0

-5.0

2017/3

2018/3

2018/12© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

2017/3

2018/3

2018/1210

（Million Yen）

Cash and deposits

1.00

58,0000.44
0.50

48,0000.15

D/E ratio

0.13

In interest-bearing liabilities, shortterm loans payable related to theacquisition of shares in FujitsuElectronics (and making it a subsidiary)
increased.

0.00

38,000-0.50

28,000Interest bearing debts-1.00
18,00026,42330,80332,014
24,669Cash and deposits
-1.50

8,000

-2,000

9,805

8,900

2017/3

2018/3

2018/12© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

-2.00

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（Million Yen）

2018/3

2019/3Results

Forecasts

Medium-Term
Management Plan
TargetYoY

Net sales

235,921290,000

54,079+22.9%

290,000

Gross profit

32,49835,500

3,002

+9.2%

-13.8%

12.2%-1.6ptSG&A

24,37927,8003,421+14.0%-Operating income

8,119

7,700

-419

-5.2%-

Ordinary income

8,740

8,000-740-8.5％

10,000

Profit attributableto pwners of parent

6,490

7,300

810

+12.5%-EPS（Yen）

236.58266.0429.46--

9.5

9.9+0.4ptGross profit margin

ROE© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

-

8.0%
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（Million Yen）

Forecasts

YoY
54,952

32%

5,312

5,200

-112

-2%

47,58243,000-4,582-10%Sgment income

2,202

1,700-502-23%

Net Sales

2,568

2,800

232

9%

172300128

74%

13,522

17,000

3,478

26%

308

500

192

62%

235,921290,000

54,07923%

8,119

7,700-419-5%

Information
Equipment

Net Sales

TotalResults

227,200

Net Sales

Others2019/3

172,248

Electronic
Component

Software2018/3

Sgment income

Sgment income
Net Sales
Sgment income
Net Sales
Sgment income

Note: Figures of each segment income are not inter-segment adjusted.
Total amount is inter-segment adjusted (operating income).
© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

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(Million Yen)

Net Sales

56,174
2,872
448
11,13260,4083,202
694
12,31457,465
2,627
399
11,299Total

61,873
4,819
1,027
12,83659,88955,4934,10346510,417

5,276
939
10,72558,3995,190538
11,231

YoY ： +934
QoQ： -1,490

OthersYoY ： ＋2,563
QoQ :-85

SoftwareYoY ：QoQ：+139-400

Information equipment

41,721

44,197

43,13943,19040,50742,94841,438YoY ：QoQ :-68+505

Electronic component
YoY ： -1,700
QoQ： -1,509

2018/3
1Q Results

2018/3
2Q Results

2018/3
3Q Results© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

2018/3
4Q Results

2019/3
1Q Results

2019/3
2Q Results

2019/3
3Q Results14

(Million Yen)

Segment IncomeTotalYoY ：QoQ :-242-305

Others

2,305
2,088
152035846112
757

2,282

2,21937543

1,5067280543

1,539

1,3531,489

2018/3
3Q Results

54780317

1,071

1,402

▲ 19▲ 20
2018/3
2Q Results

135
162

1,616802

2018/3
1Q Results

YoY ：
QoQ :

2018/3
4Q Results

2019/3
1Q Results

1,976198474

2019/3
2Q Results

Information equipment
YoY ：
QoQ :

-68-72

Electronic component
YoY :

-310

QoQ：

-96

1,306

▲ 20＋161＋63

Software
YoY :
QoQ :

-0-183

2019/3
3Q Results

Note: Figures of each segment income are not inter-segment adjusted.
Total amount is inter-segment adjusted (operating income).
© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

15

（Reference）
Effect of 1% change（Million Yen）

Net sales

Ordinary
incomeForex
Assumption
for 2H(yen)111.14199

21

110.00

3.33

3.41

164

8

3.40

RMB

16.47

16.85

105

517.00

HKD

14.31

14.18

115

214.00FY2018/3
3Q Results

FY2019/3
3Q Results

USD

111.70THB（Yen）© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

（Yen）

16Electroniccomponents• Sale of semiconductors (general-purpose products and customizedproducts)• Sale of electronic components (transformers, condensers, cables,connectors, and switches, etc.), LED, and storage devices• Development, manufacture and sales related to EMS (airconditioning, office equipment, automotive devices, industrial
equipment, amusement machines, communication equipment,
medical equipment, etc.)

Informationequipment• Sales of PCs and PC peripherals, home electric appliances/lighting
fixtures, photograph and imaging products, original brand products,etc.)

Software• Production of computer graphics, planning and development ofamusement products, and other activities

Others• Repair and supports for electronics equipment, manufacture andsales of amusement equipment, and wholesale/retail of sports goods,etc.)© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

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20 Kandamatsunagacho, Chiyoda-ku, Tokyo 101-8629
Contact: Investor Relations & Public Relations Office
TEL:+81-3-5657-0106
FAX:+81-3-3254-7133
E-mail： webmaster@taxan.co.jp
https://www.taxan.co.jp© 2017 KAGA ELECTRONICS CO.,LTD All Rights Reserved.

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