August 4, 2022

Summary of Consolidated Financial Results
for the First Quarter Ended June 30, 2022 [Japan GAAP]
Name of Company:
Stock Code:
Stock Exchange Listing:

KAGA ELECTRONICS CO., LTD.
8154
URL: https://www.taxan.co.jp/
Tokyo Stock Exchange, Prime Market
Title: Representative Director,
Representative
Name: Ryoichi Kado
President & COO
Title: Director, Managing Executive Officer
Contact Person
Name: Eiji Kawamura
Head of Administration Headquarters
Phone:+81-(0)3-5657-0111
Date of filing of quarterly securities report (tentative):
August 15, 2022
Date of commencement of dividend payment (tentative):
Quarterly earnings supplementary explanatory documents: Yes
Quarterly earnings presentation:
No(Yen in millions, rounded down)
1. Financial results for the first quarter of the fiscal year ending March 2023 (April 1, 2022 – June30, 2022)(1) Result of operations (Consolidated, year-to-date)(Percentage figures represent year on year changes)
Profit attributable
Operating income Ordinary income
to owners ofparentNet sales
Million yen%

Million yen%

Million yen%

Million yen%

First quarter ended June 2022

149,30240.9

9,820 120.6

9,858 115.9

6,984 143.2

First quarter ended June 2021

105,94925.9

4,452 168.8

4,566 197.8

2,872 (66.6)

Note: Comprehensive income: 1Q of FY2023/3: 11,314 million yen [234.4%] 1Q of FY2022/3: 3,383million yen[ (63.0%)]

Earnings per
share(diluted)

Earnings per
share
Yen

Yen

First quarter ended June 2022

266.10－First quarter ended June 2021

104.55－(2) Financial Position (Consolidated)
Total assets

Net assets

Equity ratio

Million yen

Million yen%

As of June 30, 2022

286,756

115,119

40.1

As of March 31, 2022

272,139

105,800

38.8

Reference: Shareholders’ equity：As of June 30, 2022: 115,008 million yen

As of March 31, 2022: 105,680million yen

2. Dividends
Dividend per share

1Q

Fiscal year ended March 2022
Fiscal year ending March 2023
Fiscal year ending March 2023 (Forecast)

Yen

2Q

－

Yen

45.00

3Q

Yen

Year-end－

Yen

Full year

75.00

Yen

120.00

－
70.00

－

80.00

150.00Notes: Change in the dividend forecast from the latest announcement: None
Breakdown of interim dividend for FY3/22: Ordinary dividend: 40.00 yen; Extraordinary dividend: 5.00 yen
Breakdown of year-end dividend for FY3/22: Ordinary dividend: 40.00 yen; Extraordinary dividend: 35.00 yen
Breakdown of year-end dividend for FY3/23 (Forecast): Ordinary dividend: 70.00 yen; 55th Anniversarycommemorative dividend: 10.00 yen3. Forecast for the fiscal year ending March 2023 (Consolidated, April 1, 2022 – March 31, 2023)(Percentage figures represent year on year changes)
Net sales

Full year

Operating income

Ordinary income

Profit attributable

Earnings per

to owners of parent

shareMillion yen%

Million yen%

Million yen%

Million yen%

Yen

540,000

8.9

24,00014.7

24,50014.2

16,0003.9

609.58

Note: Change in the forecast from the latest announcement: Yes
With respect to the revision of consolidated performance forecast, please refer to “Notice Regarding Upward
Revision to Earnings Forecast” announced today (August 4, 2022).

* Notes(1) Changes in significant subsidiaries (Changes in specified subsidiaries accompanied by changes in thescope of consolidation):None(2) Use of accounting methods specifically for the preparation of the quarterly consolidated financial
statements: None
(3) Changes in accounting policies, estimates, and retrospective restatement(a) Changes due to revision of accounting standards: Yes(b) Changes other than (a): None(c) Changes in accounting estimates: None(d) Retrospective restatement: None
Note: For more information, please refer “２．Quarterly Consolidated Financial Statements and Major
Notes (3) Notes to quarterly consolidated financial statements (Changes in accounting
policies)” on page 9.
(4) Number of shares outstanding (common stock)(a) Shares outstanding (including treasury shares)
As of June 30, 2022:(b) Treasury shares

28,702,118

As of March 31, 2022

28,702,118

As of June 30, 2022:

2,454,375

As of March 31, 2022

2,454,162(c) Average number of shares (quarterly consolidated during the period)
Period ended June 30, 2022:
26,247,868
Period ended June 30, 2021: 27,472,177* The quarterly audit procedures by a certified public accountant or auditing firm are not applicable to thisQuarterly Financial Results report.
* Cautionary statement regarding forecasts of operating results and special notes(Caution regarding forward-looking statements)
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. For conditions asassumption for earnings forecast and cautionary statement regarding use of the forecast, please see “1.
Results of Operations, (3) Qualitative information on consolidated earnings forecast” on page 4.
(How to obtain supplementary materials on quarterly financial results)
Supplementary materials on quarterly financial results are disclosed through TDnet and posted on the
Company’s website on the same date.

Index for Supplementary Information
1. Results of Operations ............................................................................................ 2(1) Overview of consolidated business performance ................................................ 2(2) Overview of financial condition ........................................................................ 4(3) Qualitative information on consolidated earnings forecast ................................... 4
2. Quarterly Consolidated Financial Statements and Major Notes ................................... 5(1) Quarterly consolidated balance sheet................................................................ 5(2) Quarterly consolidated statements of income and comprehensive income ............. 7
For the first quarter (April 1, 2022 - June 30, 2022) ......................................... 7(3) Notes to quarterly consolidated financial statements .......................................... 9(Notes to going concern assumptions) ............................................................ 9(Significant change in shareholders’ equity) ..................................................... 9(Changes in accounting policies) .................................................................... 9(Additional information) ................................................................................ 9(Segment information)................................................................................ 10

1. Results of Operations(1) Overview of consolidated business performance
During the first quarter of the consolidated fiscal period under review, uncertainties
continued to prevail in the overseas economy, due to the prolonged situation in Ukraine,
the impact of lockdowns in China under its zero-COVID policy, and concerns about anacceleration of inflation triggered by the surge in prices of oil and other resources.
Meanwhile, in Japan, personal consumption followed a recovery trend with theprogressive easing of restrictions on economic activity as the number of COVID-19 cases
continued to decline. Corporate earnings also showed signs of improvement, notably inthe manufacturing industry.
In the electronics industry to which the Group belongs, business was affected by global
supply shortages and extended lead times of certain semiconductors and electronic
components, but demand remained robust in a broad range of areas, led by automotiveand industrial equipment-related applications.
As a result of these factors, net sales in the first quarter of the consolidated fiscal year
rose 40.9% year on year to 149,302 million yen. This growth was driven by the electronic
components business, which is the Group’s core business. Operating income increased by
120.6% year on year to 9,820 million yen, due to a significant increase in gross profit
resulting from higher net sales and improved gross profit margin. Ordinary income
increased by 115.9% year on year to 9,858 million yen, and profit attributable to ownersof parent increased by 143.2% year on year to 6,984 million yen. All metrics from net
sales to ordinary income for the quarter achieved record highs for a consolidated firstquarter.
In November 2021, the Group announced its three-year management plan, theMedium-Term Management Plan 2024 (2022-2024), which runs from the fiscal year
ending March 31, 2023, to the fiscal year ending March 31, 2025. The new Medium-Term
Management Plan sets “organic growth + further M&A challenges” as growth engines,
seeks to reinforce and expand overseas and EMS (note) businesses, and aims to realize thegoal of becoming “Japan’s top-class corporate group in the industry with net sales of 750
billion yen” by the Plan’s final fiscal year ending on March 31, 2025. In this first quarter ofthe first fiscal year of the new Medium-Term Management Plan, the Company was able to
make a good start.
(Note) Electronics Manufacturing Service: Provision of product development and manufacturing services on an
outsourcing basis.

FY 2022/3 1Q

FY 2023/3 1Q(April 1, 2021 –(April 1, 2022 –June 30, 2021)

June 30, 2022)

YoY（Million yen）

（Million yen）

（Million yen）

Net sales

105,949

149,30243,35240.9％

Gross profit

13,55019,838

6,287

46.4％

（Margin）

12.8％

13.3％

0.5pt

－

SG&A

9,098

10,018919

10.1％

Operating income

4,452

9,820

5,367

120.6％

Ordinary income

4,566

9,858

5,292

115.9％

Profit before income taxes

4,129

9,982

5,853

141.7%

2,872

6,984

4,112

143.2%

109.49yen

129.57yen

20.08yen－

Profit attributable to ownersof parent
Exchange Rate
(Average rate during the year period)

USD

2

Business segment performance was as follows.
(a) Electronic components (Development, manufacture and sale of semiconductors,
general electronic components and other products, the electronics manufacturingservice (EMS), and other activities)
In this business, the components sales business achieved a significant increase insales through early efforts to capture the requests of customers from a broad range ofindustries. While faced with prolonged supply constraints of certain semiconductors andelectronic components which are continuing from the previous fiscal year, ongoing
efforts were made to secure sales volume using the Company’s strength inprocurement capabilities and knowledge as an independent trading company. In
addition, steady progress in PMI(Post Merger Integration) at acquired companies suchas KAGA FEI Co., Ltd. and EXCEL Co., Ltd. contributed to profit growth in this business.
In the EMS business, demand notably in automotive and medical equipment
applications remained solid. In Shanghai, China, lockdowns had an impact, but it could
be minimized without having to halt operations by making supply and sales channels
mutually available to Group companies in China and implementing thorough processcontrol.
As a result, net sales increased by 47.3% year on year to 133,477 million yen, andsegment income increased by 143.7% year on year to 9,018 million yen.
(b) Information equipment (Sales of PCs, PC peripherals, home electric appliances,photograph and imaging products, original brand products, and other products)
In this business, sales of PCs for corporations and educational institutions were firm,
while sales of PC peripherals such as security software remained strong. In the LED
installation business, large-scale work which had been delayed due to a shortage ofmaterials resumed and contributed to profit in this business.
As a result, net sales increased by 4.8% year on year to 11,147 million yen, andsegment income decreased by 0.6% year on year to 564 million yen.
(c) Software (Production of computer graphics, planning and development of amusement
products, and other activities)
In this business, games development, computer graphics production and other efforts
were made to obtain new orders. The situation, however, remained challenging.
As a result, net sales decreased by 12.3% year on year to 498 million yen, andsegment loss of 33 million yen was recorded (67 million yen of segment loss in thesame period of the previous fiscal year).
(d) Others (Repair and support for electronics equipment, and sales of amusement
equipment and sports goods, and others)
In this business, the PC and PC peripheral recycling business was strong as demand forreused and recycled products increased amid continuing supply difficulties of items suchas PC products caused by the shortage of electronic components. In addition, gameequipment for the amusement industry in Japan and overseas as well as golf products
saw growth in sales following a relaxation of pandemic-induced restrictions on movement.
As a result, net sales increased by 1.4% year on year to 4,178 million yen, andsegment income increased by 14.7% year on year to 249 million yen.
Financial Results by Business Segment

FY 2022/3 1Q(April 1, 2021 –June 30, 2021)（Million yen）

Electronic
components

Net sales
Segment income

Informationequipment

Net sales
Segment income

10,636
568

Software

Net sales
Segment income

Others

Net sales
Segment income

FY 2023/3 1Q(April 1, 2022 –June 30, 2022)（Million yen）

YoY
（Million yen）

42,8535,318

47.3％
143.7％

11,147
564

511
(3)

4.8%
(0.6％)

568
(67)

498
(33)

(69)
33

(12.3%)
－

4,120
217

4,178
249

57
31

1.4％
14.7%

90.624
3,699

Total

133,477
9,018

Net sales
105,949
149,30243,35240.9％
Segment income
4,452
9,820
5,367
120.6％
Note: “Segment income” shows unadjusted figures for each business segment and adjusted figures
for the total.

3(2) Overview of financial condition
Assets, liabilities and net assets
Total assets as of June 30, 2022 increased by 14,616 million yen from March 31, 2022,
to 286,756 million yen.
Current assets increased by 14,742 million yen compared with the end of the previous
fiscal year, to 248,727 million yen. This was primarily due to a 6,855 million yen increase
in merchandise and finished goods and a 5,133 million yen increase in accounts receivable– trade.
Non-current assets decreased by 126 million yen from March 31, 2022, to 38,028
million yen.
Liabilities increased by 5,297 million yen from March 31, 2022, to 171,637 million yen.
This is primarily due to increases of 3,993 million yen in notes and accounts payable - trade,and 4,026 million yen in short-term loans payable.
Net assets increased by 9,319 million yen from March 31, 2022, to 115,119 million yen.
This is primarily the result of recording 6,984 million yen of profit attributable to ownersof the parent.
(3) Qualitative information on consolidated earnings forecast
Regarding the full-year earnings forecast for the fiscal year ending March 31, 2023, arevision has been made to the earnings forecasts announced on May 12, 2022, aspresented below. The revision only factors in the earnings trend in the first quarter underreview given the uncertainties in the outlook, due to future trends in supply and demandof semiconductors and other electronic components, the COVID-19 situation, thesituation in Ukraine, and exchange rate fluctuations. Forecasts for the second quarter andbeyond are unchanged from the initial forecasts.
For details, please refer to “Notice Regarding Upward Revision to Earnings Forecast”
released today (August 4, 2022).
Results
FY2022/3

Previous
Forecasts
FY2023/3

Current
Forecasts
FY2023/3

Difference from
Previous Forecasts(Million yen)

(Million yen)

(Million yen)

(Million yen)

Net Sales

495,827510,000

540,000

30,0005.9％

Operating Income

20,915

21,20024,000

2,800

13.2％

Ordinary Income

21,456

21,20024,500

3,300

15.6％

Profit attributable toowners of parent

15,401

14,50016,000

1,500

10.3％

ＲＯＥ

15.7％

13.0％

14.0％

1.0pt

－

Note: The above earnings forecasts are based on the information currently available to theCompany on the date of release and certain assumptions deemed reasonable. Actual results
may vary from the forecast for a variety of reasons.

42. Quarterly Consolidated Financial Statements and Major Notes(1) Quarterly consolidated balance sheet(Million yen)
Fiscal year ended March 2022 First quarter ended June 2022
(As of March 31, 2022)(As of June 30, 2022)

ASSETS
Current assets
Cash and deposits

41,051

42,317

Notes receivable – trade

1,449

2,070

Electronically recorded monetaryclaims - operating

9,258

8,249

Accounts receivable – trade110,240

115,374264

265

Merchandise and finished goods

46,23053,086Work in process

2,363

2,733

Raw materials and supplies

14,013

15,218

Other

9,388

9,521

Allowance for doubtful accounts

(275)

(110)

233,984

248,727

Buildings and structures, net

6,925

6,857

Machinery, equipment andvehicles, net

6,048

6,638

Tools, furniture and fixtures, net

1,030

1,079

Land

5,074

5,074

Construction in progress

313

498

Total property, plant andequipment

19,393

20,148

Securities

Total current assets
Non-current assets
Property, plant and equipment

Intangible assets
Goodwill

98

72

Software

3,021

2,963

42

38

3,163

3,075

Investment securities

10,313

10,384

Deferred tax assets

2,189

1,383

Guarantee deposits

1,068

1,061

915

916

3,466

3,448

Allowance for doubtful accounts(2,355)(2,390)Total investments and other assets

15,59814,804

Total non-current assets

38,15538,028272,139

286,756

Other
Total intangible assets
Investments and other assets

Insurance funds
Other

Total assets

5

(Million yen)
Fiscal year ended March 2022 First quarter ended June 2022
(As of March 31, 2022)(As of June 30, 2022)

LIABILITIESCurrent liabilities
Notes and accounts payable - trade

86,49390,487

Short-term loans payable

23,85827,885

Accrued expenses

7,138

6,188

Income taxes payable

2,834

2,146

301

8

Other

12,291

10,967

Total current liabilities

132,918

137,683－

10,000Long-term loans payable

25,13615,130

Deferred tax liabilities
Provision for directors’ retirement
benefits
Net defined benefit liability

2,046

2,568

123

127

2,095

2,157

572

587

Other

3,446

3,383

Total non-current liabilities

33,421

33,954

166,339

171,637

Capital stock

12,133

12,133

Capital surplus

14,81814,809Retained earnings

77,42382,439Treasury shares(5,643)(5,643)

Total shareholders’ equity

98,732

103,738

1,299

1,151

(2)

(46)

5,439

10,085

210

78

6,948

11,269120

111

105,800

115,119

272,139

286,756

Provision for directors’ bonuses

Non-current liabilities
Bonds payable

Asset retirement obligations

Total liabilities
NET ASSETS
Shareholders’ equity

Accumulated other comprehensive
incomeValuation difference on availablefor-sale securities
Deferred gains or losses on hedges
Foreign currency translation
adjustment
Remeasurements of defined benefit
plans
Total accumulated othercomprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

6

(2) Quarterly consolidated statements of income and comprehensive income
For the First quarter (April 1, 2022 – June 30, 2022)
First quarter ended June 2021
(April 1, 2021– June 30,2021)(Million yen)First quarter ended June 2022
(April 1, 2022 – June 30, 2022)

Net sales

105,949

149,302

Cost of sales

92,398129,464

Gross profit

13,55019,838

9,098

10,018

4,452

9,820

Interest income

28

26

Dividends income

6371

Foreign exchange gains

106－

Commission income

60

60

Other

137

97

Total non-operating income

394

256

Selling, general and administrative
expenses
Operating income
Non-operating income

Non-operating expenses
Interest expenses
Share of loss of entities accounted forusing equity method
Foreign exchange losses

74

105

171

17

－

23

Other

34

70

Total non-operating expenses

280

217

4,566

9,858

Gain on sales of non-current assets

010Gain on sales of investment securities

97

Gain on transfer of business
Gain on revision of retirement benefit
plan
Other

7

－

－

126

－

1

Total Extraordinary income

16

144

31

19

6

0

6

0

109

－

281

－

Ordinary income
Extraordinary income

Extraordinary loss
Impairment loss
Loss on retirement of non-current
assetsLoss on valuation of investment
securities
Loss on liquidation of subsidiaries andassociates
Provision of allowance for doubtful
accounts
Other

18

0

Total extraordinary loss

454

21

Profit before income taxes

4,129

9,982

Income taxes - current

478

1,633

Income taxes - deferred

741

1,360

Total income taxes

1,220

2,993

Profit

2,908

6,989

7

(Million yen)First quarter ended June 2020
(April 1, 2020– June 30,2020)

Profit attributable to owners of parent
Profit attributable to non-controllinginterests
Other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit
plans, net of tax
Share of other comprehensive incomeof associates accounted for using
equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toowners of parent
Comprehensive income attributable tonon-controlling interests

8First quarter ended June 2021
(April 1, 2021 – June 30, 2021)

2,872

6,984

36

4

(104)

(146)

(36)

(44)

567

4,566

4

(131)

44

81

475

4,325

3,383

11,314

3,341

11,30542

8

(3) Notes to quarterly consolidated financial statements(Notes to going concern assumptions)Not applicable(Significant change in shareholders’ equity)
Not applicable(Changes in Accounting Policies)(Application of Implementation Guidance on Accounting Standard for Fair Value
Measurement)
The “Implementation Guidance on Accounting Standard for Fair Value Measurement”(ASBJ Implementation Guidance No. 31, June 17, 2021, hereinafter referred to as ASBJ
Guidance No. 31) is applied from the start of the first quarter of the consolidated fiscal
year under review. In accordance with the transitional treatment set forth in Article 27-2of the ASBJ Guidance No. 31, the Company will continue to apply the new accounting
policies prescribed by ASBJ Guidance No. 31 into the future. The effect of this applicationon the quarterly consolidated financial statements is immaterial.
(Additional information)(Application of the Practical Solution on the Accounting and Disclosure Under the GroupTax Sharing System)
The Company and some of its domestic consolidated subsidiaries have transitioned fromthe consolidated taxation system to the group tax sharing system with effect from thefirst quarter of the consolidated fiscal year under review. Accordingly, accounting
treatment and disclosure of corporation tax, local corporation tax and tax effectaccounting are conducted pursuant to “the Practical Solution on the Accounting andDisclosure Under the Group Tax Sharing System” (Practical Solution No. 42, August 12,2021; hereinafter referred to as “Practical Solution No. 42”). Based on the provisions ofParagraph 32 (1) of Practical Solution No. 42, we see no impact from the change inaccounting policy associated with application of Practical Solution No. 42.
(Accounting estimates associated with the COVID-19 pandemic)
Accounting estimates such as of impairment of non-current assets and collectability ofdeferred tax assets are made based on information that is available as of June 30, 2022
and do not include significant changes from the financial statement for the previous
consolidated fiscal year.

9

(Segment information)
Ⅰ. For the first quarter ended June 2021 (April 1, 2021 – June 30, 2021)
Information about net sales and income (loss) by reportable segments(Million yen)
Reportable segments
Electronic

Information

components equipment

SoftwareAdjustment Consolidated

Others

Total(Note 1)

(Note 2)

Net sales:
Sales to externalcustomers

90,624

10,636568

4,120

105,949－

105,949

Inter-segment
sales or transfers

949

1,171

49

1,547

3,718

(3,718)－91,573

11,807

617

5,668

109,667(3,718)105,949

3,699

568

(67)

217

4,418

33

4,452

Total
Segment income(loss)
Notes:

1. Adjustment in segment income of 33 million yen includes 33 million yen for elimination of inter-segment
trade.
2. Segment income (loss) is adjusted for operating income on the quarterly consolidated statements ofincome and comprehensive income.

Ⅱ. For the first quarter ended June 2022 (April 1, 2022 – June 30, 2022)
Information about net sales and income (loss) by reportable segments(Million yen)
Reportable segments
Electronic

Information

components equipment

SoftwareAdjustment Consolidated

Others

Total(Note 1)

(Note 2)

Net sales:
Sales to externalcustomers

133,477

11,147498

4,178

149,302－

149,302

Inter-segment
sales or transfers

900

1,690

180

1,935

4,707

(4,707)－

134,378

12,838678

6,114

154,009(4,707)

149,302

9,018

564

(33)

249

9,798

21

9,820

Total
Segment income(loss)
Notes:

1. Adjustment in segment income of 21 million yen includes 21 million yen for elimination of inter-segment
trade.
2. Segment income (loss) is adjusted for operating income on the quarterly consolidated statements ofincome and comprehensive income.

10