Consolidated Financial Statements for the First Nine Months of Fiscal Year ending March 31, 2024
30/Jan/2024
These financial statements have been prepared in accordance with accounting principals generally accepted in Japan.
NEC Networks & System Integration Corporation

Stock exchange listing:Code number:Tokyo1973https://www.nesic.co.jp/english/index.html
1. Consolidated Results for the First Nine Months (April 1, 2023 to December 31, 2023)

of Fiscal Year ending March 31, 2024

(Rounded down to the nearest million yen.)(1) Net Sales and Income
Net sales Year-on-year(¥ million) change (%)
9 months/FY Mar
2024
9 months/FY Mar
2023

Operating
Ordinary
Year-on-year
Year-on-year
incomeincomechange (%)
change (%)(¥ million)(¥ million)

249,439

12.4

12,45011.4

12,1908.8

221,8811.4

11,174(8.2)

11,206(10.5)Net income
attributable
Net income
Year-on-year
to owners ofper sharechange (%)
the parent(¥)(¥ million)

Net income
per share(diluted)(¥)

9 months/FY Mar
7,698
26.0
51.68
—
2024
9 months/FY Mar
6,111(20.5)
41.03
—
2023
c.f. Comprehensive income: 9 Months/FY Mar 2024: ¥7,421 million <(7.5%)>; 9 Months/FY Mar 2023: ¥8,026 million <(2.8%)>(2) Financial Position

31/Dec/2023

Owner'sNet assets
Total assets Net assets
equity ratio per share(¥ million) (¥ million)(%)(¥)
254,661
146,05955.5
948.6331/Mar/2023
267,000
145,71452.9
948.23c.f. Owner's equity: 31/Dec/2023: ¥141,314 million;
31/Mar/2023 ¥141,242million
2. Dividends
1stquarter
FY ending Mar.
2024—

Dividends per share (¥)
3rdInterim
Year-endquarter※24.50—24.50

Full year
49.00

FY ended Mar. 2023
—
23.00
—
23.00
Note: Revisions to projected dividends for the quarter under review: No※※ Forecast

46.00

3. Financial Forecasts for Fiscal Year ending March 31, 2024 (April 1, 2023 to March 31, 2024)(Percentages represent change compared to the previous corresponding period.)
Net sales

FY ending Mar. 2024

Operating income

Ordinary income(¥ million)(%)(¥ million)(%)(¥ million)(%)

350,000

9.1

24,0005.5

24,0004.5

Net income attributableto owners of the parent(¥ million)(%)
14,0001.4

Net income
per share(¥)
93.99

Note: Revisions to projected results for the quarter under review: No
Cautionary Statement
Forecasts of results mentioned in this document are future estimates and are thus inclusive of risks and uncertain factors since they
are not based on definite facts. Please be aware that a variety of factors could cause actual results to differ significantly fromthose projected. The major factors affecting actual results include the economic climate and social trends surrounding the business of
this Company’s group, consumer trends vis-a-vis systems and services provided by this Company’s group, as well as pressure to lower
prices and ability to cope with the market in response to intensified competition.
Factors affecting results are not limited to the ones mentioned above.

4. Consolidated Financial Statements(1) Consolidated Balance Sheets
As ofMarch 31, 2023
AssetsCurrent assets
Cash and cash equivalents
Notes, accounts receivable and contract assets
Electronically recorded obligations
Purchased goods,materials and supplies
Work in process
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Deferred tax assets
OtherAllowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Notes and accounts payable
Electronically recorded obligations
Short-term bank loans
Current installments of long-term debt
Accrued income taxes
Accrued bonuses to directors and corporate auditors
Accrued warranty on products
Accrued losses on sales contracts
Accrued compensation for damage
Accrued office transfer cost
Other current liabilities
Total current liabilities
Long-term liabilities
Long-term debtLiabilities for retirement benefits
Other liabilities
Total long-term liabilities
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury stock, at cost
Total shareholders' equity
Accumulated other comprehensive income
Net unrealized holding gain on other securities
Deferred gains or losses on hedges
Foreign currency translation adjustments
Accumulated adjustments for retirement benefits
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets(Millions of yen)As of
Dec 31, 2023

68,549123,297
1,165
3,151
12,932
11,724(85)
220,735

57,757
119,991
1,660
2,557
12,233
15,959(36)
210,125

14,34313,804

153
3,592
3,745

102
3,217
3,319

14,172
14,100(97)
28,17546,264
267,000

14,697
12,819(107)
27,41044,535
254,661

44,571
1,467
8,653
202
4,493
144
161
515
3
394
26,282
86,89035,734
1,311
6,511
28
1,271
38
184
148
3
43
29,68474,961

3,000
28,4242,970
34,395
121,285

3,000
27,7752,864
33,640108,601

13,122
16,708112,486(252)
142,065

13,122
16,726113,108(244)
142,712

1,382
10(284)(1,930)(822)
4,471
145,714
267,000

436
(2)
(166)
(1,665)(1,398)4,745
146,059
254,661(2) Consolidated Statements of Income and Comprehensive Income(Consolidated Statements of Income)(Millions of yen)
1Q-3Q, FY March 2023
(9 months ended Dec 2022)

1Q-3Q, FY March 2024
(9 months ended Dec 2023)

Net sales

221,881249,439

Cost of sales

178,341

202,784

Gross profit

43,53946,654

Selling, general and administrative expenses

32,36534,203Operating income (loss)

11,174

12,450Interest income

1212

Dividend income of insurance

164

102

Other

310

396

Total non-operating income

487

511

Interest expenses

139

281

Other

168

489

455
11,206771
12,190

Expenses relating to move of the head office671－

Loss on liquidation of subsidiaries

147－

Loss on revision of retirement benefit plan99－

Total extraordinary losses

917－

Income (loss) before income taxes

10,28812,190

Income taxes

3,383

4,258

Net income (loss)
Net income (loss) attributable to noncontrolling interests
Net income (loss) attributable to owners of theparent

6,905

7,931

793

233

6,111

7,698

Non-operating income

Non-operating expenses

Total non-operating expenses
Ordinary income (loss)
Extraordinary losses(Millions of yen)
1Q-3Q, FY March 2023
(9 months ended Dec 2022)

1Q-3Q, FY March 2024
(9 months ended Dec 2023)

6,905

7,931

Net unrealized holding loss on other securities

463

(946)

Deferred gains or losses on hedges

(41)

(13)

Foreign currency translation adjustments

419

186

Adjustments for retirement benefit
Share of other comprehensive income of associates
accounted for using equity method

281

265

(2)

(2)

1,121(509)

8,026

7,421

7,100

7,121

926

299

Net income (loss)
Other comprehensive income

Total other comprehensive income
Comprehensive income (loss)
Comprehensive income (loss) attributable to:
Owners of the parent
Non-controlling interests

(3) Consolidated Statements of Cash Flows

Cash flows from operating activities
Net income (loss) before income taxes
Depreciation and amortization
Amortization of goodwill
Expenses relating to move of the head office
Loss (gain) on liquidation of subsidiaries
Loss (gain) on revision of retirement benefit plan
Increase (decrease) in allowance for doubtfulreceivables
Increase (decrease) in asset for retirement benefit
Increase (decrease) in liability for retirement
benefits
Increase (decrease) in accrued bonuses to directors
andcorporate auditors
Increase (decrease) in accrued warranty on products
Increase (decrease) in accrued losses on sales
contracts
Increase (decrease) in provision for compensation
for damage
Interest and dividend income
Interest expense(Increase) decrease in notes and accounts
receivable,and contract assets(Increase) decrease in inventories
Increase (decrease) in notes and accounts payable
Increase (decrease) in accrued consumption taxes
Other, net
SubtotalInterest and dividend income received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of property and equipment
Proceeds from sale of property and equipment
Purchase of intangibles
Purchase of investment securities
Loans receivable madeCollection of loans receivable
Other, net
Net cash used in investing activities
Cash flows from financing activities
Net increase (decrease) in short-term bank loans
Repayments of long-term debt
Net (increase) decrease in treasury shares
Dividends paid to shareholders
Dividends paid to minority shareholders ofsubsidiaries
Other, net
Net cash provided by used in financing activities
Effect of exchange rate changes on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

1Q-3Q, FY March 2023
(9 months ended Dec 2022)(Millions of yen)
1Q-3Q, FY March 2024
(9 months ended Dec 2023)

10,288
2,947
176
671
147
99

12,190
2,912
51－－－

(1)
(111)

(53)
(147)

83(609)(110)
24(105)23(1,503)

(383)

0(42)
139－
(38)
281

9,855
(5,875)(4,061)(1,442)(2,333)8,951
42(137)(7,339)
1,517

3,770
1,307
(9,068)1,189
374
11,69336(284)(8,027)3,419(1,329)0(810)(754)(7)
1(964)(3,864)(2,557)16(1,023)
(395)
(20)
2(170)(4,150)(2,101)(206)
22(6,984)(2,815)(173)
24(7,058)(25)(156)(9,452)(25)(128)(10,176)

199(11,599)
79,732
68,132

115(10,791)
68,54957,757

(4) Segment Information
Business Segment Information
First nine months of fiscal March 2023 (9 months ended December 2022)(Millions of yen)
DX Solutions
Sales(1) Sales to third parties(2) Intersegment sales
Total
Operating income and loss

80,20280,202
8,192

NetworkSolutions

Environmental &Social Solutions

55,511
55,511
5,448

80,59880,598
5,002

Others

5,569
5,569
157

Adjustments(7,627)

Total

221,881
221,881
11,174First nine months of fiscal March 2024 (9 months ended December 2023)(Millions of yen)
DX Solutions
Sales(1) Sales to third parties(2) Intersegment sales
Total
Operating income and loss

89,29489,294
9,971

Network
Solutions

59,47559,475
5,587

Environmental &Social Solutions

94,463
94,463
6,133

Others

6,205
6,205
82

Adjustments(9,324)

Total

249,439
249,439
12,450