KAGA ELECTRONICS
CO., LTD.

For Institutional Investors/Analystss

Financial Results Briefing Material
for the Fiscal Year ended March 2022

加賀電⼦株式会社

KAGA ELECTRONICS CO., LTD.
TSE Prime Market 8154

May 26, 2022

Hello, I’m Kado, the President of KAGA ELECTRONICS CO., LTD. Thank you for yourcontinued support and cooperation in our IR activities.

Management Topics

Representative Director,
President & COO

Ryoichi Kado

I would now like to report on key management topics of our company for FY2021.
The main contents of the report are our latest response to the novel coronavirus
infectious disease, a review of the previous medium‐term management plan, and the
new medium‐term management plan and sustainability medium‐term management plan.

Response to the Spread of Novel Coronavirus Infection︓
Sales bases in Japan
Office attendance rate and number of infections
FY2022/3 H1

FY2022/3 H2

FY2022/3 H1 plan

Number of
COVID-19 cases（FY2022/3）

KagaElectronics

41.5％

45.8％

40％

47

Group
companies

47.3％

51.6％

(Different foreach company)

104

Group overall

44.4%

48.7%

―

151

Infection prevention measures
Do not bring the virus towork or spread it

Thermometers
were set up

Partitions within offices

Thorough antiviral and antibacterial
measures were taken

Antiviral coating wasappliedPhotocatalytic sterilizing
deodorizers were set up

1

First, I would like to report on our preventive measures against the novel coronavirus.
For domestic sales offices, we continue to conduct sales activities with a remote working
structure and staggered commuting, putting safety first. The table shows the officeattendance rate, which was 41% for KAGA ELECTRONICS and 47% for the Group
companies during the first half of the year. In the second half of the year, they were 46%
and 52%, respectively.
The Company intends to continue supporting remote work throughout the first half ofthe current fiscal year. We set the maximum workplace occupancy rate at 40% for KAGAELECTRONICS. Each Group company sets its own targets, taking into account its
respective business categories.
The four photos at the bottom of this slide show some of our measures to prevent
coronavirus infection. Thermal cameras were installed at the entrance to the office. All
visitors and employees are required to take their temperatures and sanitize their hands
upon entering the building. Partitions were placed in the office buildings. Antiviral andantibacterial coatings were applied. In addition, Caltech sterilization and deodorization
machines were installed.
Despite these thorough measures to prevent infection, a total of 151 infection cases
were reported across the domestic Group companies. In the previous term, the number
was 14. It means that the infection case count increased more than tenfold. I have an
impression that the overwhelming number of infections were caused by the employees’
family members. Fortunately, none of the patients became seriously ill, and everyone isback at work in good health.

Response to the Spread of Novel Coronavirus Infection︓
Overseas Production Bases
Status of factory operation and number of infections
︓Operationsuspension
periodFY2022/3 H1

FY2022/3 H2

China

FY2022/3 H1
3/14〜20:Shenzhen

Thai
Indonesia
Malaysia

7/15〜26

Vietnam

7/22〜9/27

India
Czech
TurkeyNumber of
COVID-19 cases（FY2022/3）
China

0

Asia

113

Europe2

America18

MexicoInfection prevention measures
Do not bring the virus towork or spread it

Temperature taken
when arriving at work

Goggles and masks worn

Social distancing wasstrictly enforced
Production lines

Partitions in thefactory cafeteria

2

Next, I would like to report on the status of our overseas production sites. This section
summarizes the operational status of each location.
In Vietnam, the Kyokuto Electric Plant was shut down for a fairly long period from July to
September last year due to the lockdown in Ho Chi Minh City. During this period,
production was transferred to Japan and continued but normalized, and production in
Vietnam was resumed after October.
There was a lockdown in Malaysia in July and in Shenzhen in March of this year, and theline was shut down for about a week each. In the rest of the world, production activities
were able to continue without interruption.
Even at our overseas EMS factories, we ensure all employees take their temperaturewhen entering the factory, wear masks and goggles inside the factory, and keep social
distance on the production line and on the employee buses that employees ride to work.
In addition to hand washing, gargling, and alcohol disinfection measures, we also apply
disinfecting spray inside the plant. Partitions in the cafeteria are used to protect
employees from being exposed to contact or spreading infection.
A total of 133 cases of infection were reported in Asia, Europe, and the Americas. No
one was seriously affected, and there was not a single case of mass infection at theplants.

0

Review of the Previous Medium-term Management Plan:
Results of management policiess
Basic policy

Enhancement of
Revenue BasePriority themes▶ Focus on markets andareas in which high growthand profitability are expected

Main results〇 Revenue increase effect throughacquisition of companies︓about ¥215 bn〇 Growth of EMS business︓about ¥28 bn〇 KAGA FEI: Gross profit margin

Stabilization ofManagement
Base▶ Swift recovery of theGroupʼs management
efficiency and financial
soundness after weakness
caused by acquisition ofcompanies

6.3% (FY18 results) ➔ 9.8% (FY21 results)〇 Kaga Electronics: Consolidated SG&A ratio

9.5% (FY18 results) ➔ 8.0% (FY21 results)〇 Kaga Electronics: Equity ratio
35.8% (end/Mar 2019 results)➔ 38.8% (end/Mar 2022 results)〇 Venture investments︓19 projects executed

Creation of New
Businesses▶ Enhancement of resiliency(investments in 42 companies)
to changes in the external△
Socialissues solutions-oriented business︓
environment, actively
leveraging in-house
Entry into disaster-readiness helicopter andresources, and M&A
EV bus mobility business, preparation forentry into medical device business

3

Next, I would like to review the completion of the medium‐term management plan 2021.
I have summarized the results in two slides regarding our business plans and the results.
Regarding the first measure, strengthening our earnings base. We have been actively
involved in corporate acquisitions over the past three years, including KAGA FEI and
EXCEL. As a result, we gained approximately JPY215 billion in new net sales andcustomers. In terms of profitability, we were able to increase our high value‐added EMS
business by approximately JPY28 billion.
Regarding the second point, stabilization of the management base, KAGA FEI's grossprofit margin, which was low at the time of acquisition, has improved by more than 3
percentage points over the past three years. In addition, SG&A to sales ratio for KAGAELECTRONICS has dropped a little more than 1 percentage point over the past three
years, and its equity ratio has returned to nearly 40%. As such, we assess that theefficiency and financial soundness of the Company are steadily improving.
Our third focus is the creation of new businesses. We are working on projects with thetheme of solving social issues, such as disaster prevention helicopters and EV buses, andhonestly, we evaluate what we have done and what we have not done here as both.
Those that were completed are marked with a blue circle, and those that were
inadequate are marked with a red triangle.

Review of the Previous Medium-term Management Plan:
Results of management figures（billion yen）

Net sales<Management Targets>▶ Fell slightly short▶ Largely absorbed
JPY500bn
unexpected impacts such as
those from loss of major<Results>
commercial rights and
JPY495.8bn COVID-19

Operatingincome<Management Targets>

JPY13.0bn<Results><Results>

15.7％

200.0

292.8

443.6

422.4

495.8

FY2019FY2020

FY2021

0.0
FY201825.0
20.0▶ Greatly exceeded▶ Achieved record profits
over 3 successive fiscal years

20.9

15.0

13.0

10.0
5.0

7.6

10.0

11.5

FY2019FY20200.0
FY2018ROE
8％ or higher

500.0
400.0

（billion yen）

JPY20.9bn<Management Targets>

600.0

20%

▶ Exceeded stable ROE of
8% from the second year of
the medium-term plan

15%

13.5%

10.9%

FY2021

15.7%

7.6%

10%

8.0%

5%
0%
FY2018FY2019FY2020

FY2021

4

Next, I would like to review the business performance.
The actual sales for FY2021 were JPY495.8 billion, compared to the management targetof JPY500 billion in sales. I think the results were slightly less than satisfactory. However,during the period there were some unexpected events, such as the loss of majorcommercial rights at KAGA FEI, the novel coronavirus, and semiconductor shortages. In
the end, however, we were able to absorb these adversary effects.
Operating profit was JPY20.9 billion versus a management target of JPY13 billion, so thetight supply‐demand balance in the market also served as a tailwind to achievesatisfactory results. The Company posted its highest profits for the third consecutive year.
Since profit margins have improved, ROE has remained in the 10% range for two
consecutive years, exceeding the management target of 8%.

Outline of the new medium-term management plan
JPY 1 tn

Aim to become a competitive “World classcompany”
Aim to be “Japanʼs No. 1
corporate group in the industry”

Organic
growth+Further M&A
Challenges

Expansion of
trading company business

Increased
Sales

JPY

750 bnGrowth fields

Increased
ProfitRatio

Mobility
Communications
Environment

will lead to
growth of the EMS business
Quantitative
expansion of trading
company businessIndustrial
equipment
MedicalQualitative improvement
through EMS business

Reinforcement and expansion of overseas business, EMS business

Health care

（Net Sales）

Medium-Term Management Plan 2024
Further reinforcement of
profitability

Reinforcement ofmanagement baseCreation of new businesses

Promotion of SDGs
management“CHALLENGE 1.60"
Sales of ¥1 tn in year of
60th anniversary offounding

5

Next, I would like to refer our new medium‐term management plan 2024, which wasannounced last November.
This will be duplicated for those who attended the last meeting, so we would like tofocus on the main points and reconfirm them. This slide provides a summary of the new
medium‐term management plan. The basic design is inherited from the previous
medium‐term management plan.
The sources of our growth potential are organic growth plus new M&As, overseas
business, and EMS business as growth opportunities, and focused growth areas aremobility, telecommunications, environment, and industrial equipment.
In these fields, we aim to become a top‐class company in the industry in Japan, with
JPY750 billion in net sales, by capturing the trading business of electronic components
and the EMS business of board mounting as growth drivers. We aim to achieve annual
sales of JPY1 trillion to grow ourselves into an enterprise that can survive global
competition.

Management Policies of the new medium-term management plan

Basic policy
Further
Reinforcement ofProfitability

Priority themes▶ Focus on markets
with potential forhigh growth andprofitability▶ Transformation toa Group management
Reinforcement offoundation worthy ofManagement"Japanʼs No. 1
Base
corporate group in
the industry"

Creation of New
Businesses▶ Active use of venture
investments andM&As

Promotion of
SDGs
Management▶ achieve solutions tosocial issues andsustainable growth as
a company

Major initiatives• Selection and concentration in growth fields:
Mobility, Communications, Environment,
Industrial equipment, Medical/Health care
• Reinforcement and expansion of EMS businessand overseas business• Reinforcement of corporate governance• Efficient Group management• Investments in human capital• Initiatives in new fields• Promotion of open innovation through venture
investments• M&A efforts aimed at discontinuous growth• Promotion of group-wide sustainability
management(See “Medium- to long-Term Sustainability
Management Plan” for details)
6

In this slide, I will review the four basic policies as management measures of the new
medium‐term management plan.
To further strengthen profitability, it is important to focus on markets with high growthand profitability potential. The areas we are working on are as I mentioned earlier.
To strengthen our management foundation, we recognize that it is an important issue totransform our management structure to be appropriate for the number one company in
the Japanese industry, and we will work on strengthening corporate governance,
efficient group management, and investment in human capital.
As for the creation of new businesses, we will continue to promote open innovation
through venture investment, and we will also aggressively pursue M&A opportunities toachieve discontinuous growth.
Regarding the promotion of SDGs management, we will promote sustainability
management across the Group with the aim of both solving social issues and achieving
sustainable growth as a company. I will review it again later in the sustainability medium‐
term management plan.

Management Targets of the new medium-term management plan
There was pressure from special factors that were not predicted when formulating the plan, leading to profit levels
that exceeds the medium-term management target of 20 billion yen. We will conduct a revision as appropriate
given the actual state of affairs, focusing on the progress of performance as of the 1H of FY2022.
(Net Sales)

1,000Electronic Componens

EMS

CSI

50 (Operating

OthersIncome)

CSI: Consumer & System Integrator

45(Net Sales)

JPY750.0bn

800

600

JPY470.0bn

JPY495.9bn

12.0
400

200

0

40
110

JPY15.0bn

12.0

12.5
40

JPY20.9bn

39

JPY21.2bn

New
M&As

35

150
54

12.0
(Operating Income)

150 JPY20.0bn

25

15
10

380

334

5

FY2021 Forecasts
At the time ofplan formulation

FY2021Results

FY2022
Forecasts

FY2024
Management
Targets

Net sales

JPY470.0bn

JPY495.8bn

JPY510.0bn

JPY750.0bn

Operatingincome15.0bn20.9bn21.2bn20.0bn

9.7％

15.7％

13.0％

8.5％ or higher

ROE

30

20

125

118

326

308

JPY510.0bn

40

0

7

Next, I will review the management targets of the new medium‐term management plan.
For fiscal 2024, the final year of the new medium‐term management plan, we have set atarget of JPY600 billion in net sales through organic growth and JPY750 billion including
new M&As. In aiming to become a JPY1 trillion company in the future, our scenario is tocreate JPY750 billion in the next three years, even if we have to buy from outside
sources what we lack in organic growth.
We have set a target of JPY20 billion for operating income. The idea is to create thisthrough organic growth without relying on M&As. When the plan was announced lastNovember and at the time of the second quarter financial results, the operating profit
forecast for FY2021, the launch pad, was JPY15 billion, but due in part to the boost from
special factors that were not factored in when the plan was formulated, actual resultsfor FY2021 were JPY20.9 billion.
The forecast for FY2022 is also JPY21.2 billion, which means that the current profit levelexceeds the target of the medium‐term management plan. The Company intends torevise the forecast in a manner consistent with the actual results after determining thedegree of progress of business performance in the first half of FY2022.
ROE is set at a stable 8.5%, or higher, to consistently exceed the cost of shareholders'equity, which we consider to be around 7% to 8%.

Sustainability Policy
Under our corporate philosophy of "Everything we do is for our customers," the Kaga Electronics
Group seeks to achieve both a sustainable society and sustainable growth of the Group.
Toward this purpose, we will respect dialogue with customers, business partners, shareholders,investors, employees, local communities, and all other stakeholders, based on our Basic CSR Policy,
Environmental Policy, and Action Guidelines. We will work to increase our corporate value as weplay an active role in achieving a sustainable society.

1 We will tackle environmental issues through our business activities
Through our business activities, we will take action to cut CO2 emissions, reduce waste, andpromote reuse. At the same time, by providing environmentally considerate products and services,
we will contribute to bringing about a society that values the global environment.

2 We will respect human rights and develop human resources
We will respect the human rights of all stakeholders, regardless of gender, age, nationality, social
status, disabilities, or other personal attributes. We will develop work environments in which
diverse employees can work in safety and health, both physically and mentally, and will develop
personnel systems and education and training systems that allow these employees to maximize
their individual abilities. We will further work to develop human resources who will take on thechallenge of innovation.

3 We will work to build mutual trust with society
We will work to be a company that earns the trust of society by observing laws and regulations,by strengthening our governance structure, and by sincerely engaging in fair competition, theprovision of high-quality products and services, timely and appropriate information disclosure,and other corporate activities.
8

The first few slides from here show the sustainability medium‐ to long‐termmanagement plan that we announced last November together with the new medium‐
term plan. This is also repetitive, so let me pick up just the main points.
We have established a Sustainability Policy that illustrates the KAGA ELECTRONICS
approach to SDGs. As stated in this preamble, our corporate slogan is “Everything we do
is for our customers.” Accordingly, we set two targets: fulfillment of a sustainable society
and sustainable group growth.
The following three items are outlined in our Sustainability Policy.
The first is to address environmental issues through our business activities. We
contribute to the realization of a society that cares for the global environment by
reducing CO2 and waste and providing environmentally friendly products and services.
The second is to respect human rights and develop human resources. We respect thehuman rights of all stakeholders regardless of gender, age, or nationality. We will also
work to develop human resources by creating a workplace environment in which
employees can work safely and healthily, both mentally and physically, and by
developing personnel and training systems that enable employees to maximize theirindividual abilities.
Third, we aim to establish mutual trust with society. It is to conduct corporate activities
with integrity, including compliance with laws and regulations, fair competition,
provision of high‐quality products and services, and timely and appropriate information
disclosure, as well as to strengthen our governance system. We aim to be a company
trusted by society.

Materiality
The Kaga Electronics Group is committed to seriously addressing a variety of issues relevant not
only to itself but also communities around the world and thereby living up to the expectations ofsociety. In line with this commitment, the Group has employed four perspectives̶ Environmental(E), Social (S), Governance (G) and Business (B)̶to identify priority issues that are deemed toexert significant impact on its business operations, as listed below. Through its efforts to tackle themateriality of these issues, the Group will practice corporate activities aimed at contributing to therealization of a sustainable society, with the aim of further improving its corporate value.
Materiality

E

Create a clean
globalenvironment

S

Create aninclusive company
as well as anaffluent societyG

Createa sustainable
management base

B

Realizesustainablebusiness growth

Related SDGs

Changes in the socio-economic
environment• Growing seriousness of global warming
and other environmental problems• Urgent call for carbon neutrality• Changes in social structure as we movetoward the popularization of the newnormal• Human resource shortages attributable
to a low birthrate and an aging
population• Public calls for more robust corporate
governance• Growing need for business resilienceagainst changes in the operating
environment• Progress in digital transformation• Coming of a “super-smart” society due
to the popularization of ICT, such as
IoT and AI• Intensification of global competition

Our initiatives• Provide products and services designed tohelp resolve environmental and energy
issues• Continue initiatives to reduce theenvironmental burden• Promote workforce diversity andinnovative work styles to better adapt to
the new normal• Develop human resources by passing
down and updating KAGA-ism• Further strengthen corporate governanceand compliance• Thoroughly practice a profit-focusedmanagement approach• Provide products and services that
contribute to the transition to a digitaldriven society• Create new businesses aimed at helping

9This slide is a key issue that we have discussed and identified.
We have identified key issues that will have a significant impact on our managementfrom the four perspectives of the environment, society, governance, and our business.
Through efforts to address these important issues, we will implement corporate
activities that contribute to the realization of a sustainable society and promote further
enhancement of corporate value.
Specifically, our key tasks are to create a clean global environment in terms ofenvironment, to create a company that is easy to work for and prosperous society interms of society, to create a sustainable management foundation in terms of governance,
and to achieve sustainable business growth in terms of business.

Medium- to long-term sustainability targets and major KPIs
Key themesE

Achievement of shift to100% renewable energy

Issues to address and issues to
examine• Adoption of renewable energy atdomestic sales offices• Adoption of renewable energy atdomestic manufacturing sites• Adoption of renewable energy atoverseas manufacturing sites

Shift to electricity for• Switch to electric vehicles for domestic
sales vehicles (EV, HV, PHV, FCV)
company-owned vehicles

Long-term targets

2024: 40% (1%)

2030: 100%

By 2024: Information
gathering/analysis and determinationof policy
・In-house power generation/external
procurement
・Solar panel/biomass power
generation/renewable energy
businesses

2030: 50%
2050: 100%

2024: 85% (78.5%)

2030: 100%

Diversity and humanresource management• Ensuring diversity in core humanresources (Women, foreign
nationals, mid-career hires)• Initiatives to employ elderly workers
and persons with disabilities

Percentage of female newgraduates in general positions
2023: 30% (5.8%)
Percentage of women in
management positions
2024: 15% (13.3%)

Work–life management
and enhancement of
productivity• Enhancement of programs such as
childcare/family-care and telework• Acquisition of certification as a Healthand Productivity Management
Organization

2022: Implementation of review
2023: Certification

Restructuring thegovernance structure in
response to the revision of
the CG Code and thereorganization of TSE• Independent Outside Directors: atleast 1/3
• Establishment of Nomination andCompensation Committee

Performed in June 2021

Further strengthening
the supervisory andoversight functions of
top management overbusiness execution• Diversification of the Board of
Directors• Full compliance with Corporate
Governance Code for Prime Market• Adoption of delegation-based
executive officer structure• Transition to structure of company
with committees

S

G

Medium-term targets

By June 2022: Determination ofpolicyPerformed in November 2021

2030: 30%
2050: 100%

Percentage of female
new graduates ingeneral positions
2028: 40%
Percentage of women in
management positions
2029: 17%2025: Certification byoutside party
2024 onward:
Continuation ofcertification

Setting of targets inline with next CG Coderevision

April 2022: Enactment
By March 2023: Determination ofpolicy*Numbers in parentheses represent current values

10

For each of these details, we have compiled a list of themes, goals, and KPIs to beaddressed.
In terms of the environment, we are working to achieve 100% renewable energy
consumption in our business activities. Currently, only 1% of our sales offices in Japanuse renewable energy, but we aim to increase this to 40% by 2024, and 100% by 2030.
Meanwhile, we have set long‐term targets for the energy used by our EMS business at
our factories in Japan and overseas, ranging from 30% to 50% by 2030, and 100% by
2050. To implement this policy, we will collect and analyze information over the next
three years and decide on the choice between in‐house power generation and external
procurement, as well as on the methods to be used in the case of in‐house power
generation. Through these efforts, we would also like to consider declaring RE100.
In society, we are committed to diversity and human resources management, as well
as work‐life management and productivity improvement. In particular, to ensure
diversity in core human resources, we will increase the ratio of women in management
positions, currently around 13%, to 15% by 2024.
Lastly, corporate governance. We will work to rebuild our governance structure in
response to the CG Code revision and TSE reorganization and to further strengthen
management oversight and execution functions. In April last year, we established theSDGs Committee, under which working groups on the environment, society, andcorporate governance were formed to discuss ESG issues and compile thesustainability medium‐term management plan.

Medium- to long-term sustainability targets:
Main activities and progress
Key themesE

Achievement of shift to100% renewable energy

Issues to address and issues to
examine• Adoption of renewable energy atdomestic sales offices

 Measured the electricity usage (approx. 4.42 million KWh).
Started study of when to purchase renewable energy.

• Adoption of renewable energy atdomestic manufacturing sites

 Measured the electricity usage (approx. 6.72 million KWh).
Solar panels, onsite/offsite PPA, etc., are under consideration.

Shift to electricity for• Switch to electric vehicles for domestic
sales vehicles (EV, HV, PHV, FCV)
company-owned vehicles

Diversity and humanresource management

S
Work–life management
and enhancement of
productivity
Restructuring thegovernance structure in
response to the revisionof the CG Code and thereorganization of TSE

G

Further strengthening
the supervisory andoversight functions of
top management overbusiness execution

Main activities and progress in FY2021

 80.8% complete (as of March 31, 2022).

• Ensuring diversity in core humanresources (Women, foreign
nationals, mid-career hires)

 Formulated an action plan based on the Act on Promotion of
Womenʼs Participation and Advancement in the Workplace.
Started hiring activities in accordance with the plan.
 Informed group companies to improve percentage of womenin management positions. Started setting targets for numberof women in management positions at each group company.

• Initiatives to employ elderly workers
and persons with disabilities

 Employment of persons with disabilities is 100% of the legally
mandated rate (as of March 31, 2022).

• Enhancement of programs such as
childcare/family-care and telework

 Regulations and rules are being revised to make telework apermanent system.

• Acquisition of certification as a Healthand Productivity Management
Organization

 Prepared information to be disclosed on the website with aneye to acquisition of certification.

• Independent Outside Directors: atleast 1/3
• Establishment of Nomination andCompensation Committee Implemented from June 2021.

• Diversification of the Board of
Directors

 Activities underway to elect female directors in June 2023.

• Full compliance with Corporate
Governance Code for Prime Market

 TCFD-compliant information to be disclosed from June 2022.

• Adoption of delegation-based
executive officer structure Implemented from April 2022.

• Transition to structure of company
with committees

 Policy to be determined in FY2022.
*Numbers in parentheses represent current values

11

In the first year of the sustainability medium‐ to long‐term management plan, less thansix months from last November to this March, we have summarized our progress
during that period and would like to report on it.
First, with regard to the shift to 100% renewable energy for the environment, we haveconducted a survey of electricity consumption at our sales and manufacturing sites inJapan and have begun considering when to purchase renewable energy for our sales
offices. In addition, we have begun to consider the installation of solar panels and on‐site and off‐site PPAs at our manufacturing facilities.
In the area of social diversity and human resources management, we have formulated
an action plan based on the Act on Promotion of Women’s Participation andAdvancement in the Workplace in order to raise the ratio of female new graduates incareer‐track positions. Recruitment activities in line with this plan have begun thisfiscal year. As of the end of March this year, KAGA ELECTRONICS has achieved 100% of
the legally mandated employment rate for persons with disabilities.
With regard to work‐life management and productivity improvement, we are currently
reviewing our regulations to make remote working a permanent system. In addition,
we have completed the necessary disclosure information on our website in preparationfor obtaining certification in Health and Productivity Management.
Lastly, about governance, as part of the restructuring of the governance system in
response to the revision of the CG Code and the reorganization of the TSE, we
implemented the establishment of at least one third of independent outside directors
and the Nomination and Compensation Committee last June. In terms of diversifying
the Board of Directors, we are working toward the appointment of a female board
member by June 2023.
To further strengthen the supervisory and executive functions of management, we
introduced a delegated executive officer system in April of this year. We would like to
finalize our policy on companies with committees by March 2023.

Shareholder ReturnBasic Policy on
Dividends ofSurplus

We shall perform stable dividends, while securing a consolidated dividend payout
ratio of 25 to 35%.
We shall use funds for business investments, capital investments, and M&A, etc.
in order to contribute to future growth.
Decisions on the acquisition of treasury shares shall be made appropriately,in consideration of capital efficiency and share price, etc.

■ Commemorative
dividend■ Special dividend

JPY35
5

JPY40

30

30

FY2013Results

FY2014
Results

10

35%

27.2%

(Forecast)

25.6%■ Ordinary dividend

32.8%

29.6%

28.6%
25.5%

Total return trend︓44.3%
Acquisition of treasury shares(JPY 3,674 mil)

24.1%

27.4%

20.8%
19.3%
※Including negative goodwill
about JPY8 bn

Total return trend︓45.4%
Acquisition of treasury shares(JPY 1,499 mil)

JPY55

JPY60

15

20

40

40

FY2015Results

FY2016
Results

JPY70

JPY120
JPY80

10

5
5

60

70

FY2017
Results

FY2018Results

JPY70

JPY80

10

20

60

60

FY2019Results

FY2020Results

25%
JPY150
10

40
140
80

FY2021Results

FY2022
Forecasts

12

Now, the last slide is about shareholder returns. Shareholder return is one of the mostimportant management issues for the Company, and we strive to actualize stabledividends in accordance with the basic policy written herein.
The Company pays two types of dividends: ordinary dividends and special dividends. It is
customary to pay a special dividend if the profit plan made at the beginning of the fiscal
year is revised upward during the fiscal year, or if the final results exceed the previous
forecast, depending on the extent of the upward revision.
For the fiscal year ending March 2022, the initial dividend forecast was JPY40 for boththe interim and year‐end dividends, for an annual dividend of JPY80 per share, but thiswas subsequently revised upward three times, to a final dividend of JPY120 per share.
This is an increase of JPY40 per share over the previous fiscal year.
For the fiscal year ending March 2023, we will pay an ordinary dividend of JPY140 per
share, plus a commemorative dividend of JPY10 per share to celebrate our 55th
anniversary, bringing the total dividend to JPY150 per share, an increase of JPY30 fromthe previous year.
This graph shows the change in dividends over 10 years. The green bar is the special
dividend, which has been paid for eight consecutive years since the fiscal year ended in
March 2015. To ensure that this trend continues in the fiscal year ending March 2023
and beyond, we are firmly committed to group management in line with the new
medium‐term management plan and the sustainability medium‐term management planthat I reviewed today.

ReferenceFinancial Highlights by Business Segment <Net Sales>（million yen）

Net
売上⾼
Sales
143,143
128,099

104,729
84,1302,904
491
12,5374,600
783
10,654105,406
4,114
730
10,745

129,675

5,969

117,059927
14,451

4,530
669
8,077

105,949
4,120
568
10,636

4,478
603
7,587

6,460
926
13,315

Total
YoY
QoQ

︓
︓

YoY

︓

+490

QoQ ︓

+1,981Other

Software
YoY ︓
QoQ ︓

106,750
88,69090,62489,816

103,782

117,005

122,440-1+322

Information equipment
YoY ︓
QoQ ︓

68,196-1,135+5,728

Electronic equipment
YoY ︓
QoQ ︓

2021/3
1QResults+15,043+13,4672021/3
2QResults

2021/3
3QResults

2021/3
4QResults

2022/3
1QResults

2022/3
2QResults

2022/3
3QResults+15,690+5,4352022/3
4QResults

14

Financial Highlights by Business Segment < Segment Income >（million yen）

Segment Income
6,357

6,276

152

152
83

305

869

4,452

3,082
2,778
137

1,656

131
577

112
20
592

3,950

217

3,848

325

568

103

728

5,878
5,124
3,699

583
1,897

2,335

-44
-101

2021/3
2QResults

2021/3
3QResults

YoY
QoQ

︓
︓

YoY
QoQ

︓
︓

Other
-172
+0

-73
+83

Information equipment
YoY
QoQ

︓
︓

+140
+563

Electronic equipment
YoY
QoQ

2021/3
4QResults+2,326
-81

3,423

2,732

1,185

2021/3
1QResults︓︓

Software

342

156

Total
YoY
QoQ

-67

-42

-0

2022/3
1QResults

2022/3
2QResults

2022/3
3QResults︓︓+2,372-772

2022/3
4QResults

Note: Figures of each segment income are not inter-segment adjusted.
Total amount is inter-segment adjusted (operating income).

15

Net Sales by Region（million yen）

Net Sales
Total

143,143

105,949
72,14258,14353,334

7,419
1,894

3,827
4,687

6,175
3,573

38,07039,0382021/3
2QResults

2021/3
3QResults

61,266

68,56278,484

55,101

56,6195,276
3,467

47,212

YoY
QoQ

︓
︓

+15,043+13,467Japan

117,059

84,130︓︓

129,675

128,099
104,729 105,406

YoY
QoQ

7,454
3,915

8,721
4,301

39,47742,7702022/3
1QResults

2022/3
2QResults

8,675
3,938

9,249
4,718

48,49850,6902022/3
3QResults

2022/3
4QResults+6,342+9,921

North America
YoY
QoQ

︓
︓

+3,972
+573

YoY
QoQ

︓
︓

YoY
QoQ

︓
︓

Europe+1,251+779

Asia+3,477+2,192

21,4822021/3
1QResults

2021/3
4QResults

16

Exchange Rate/FOREX Sensitivity（Reference）
Effect of 1% change（Million Yen）

Net sales

OperatingincomeForex
Assumptionfor2023/3(yen)112.381,573

46116.00

15.48

17.03

242

9

18.00

THB

3.42

3.44

251

14

3.50

HKD

13.68

14.44

208

6

14.50

EUR

123.70130.50100130.00

FY2021/3
Results

FY2022/3
Results

（Yen）

（Yen）

USD

106.06

RMB

17

“Everything we do isfor our customers
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/en/

This concludes today's presentation. Thank you.

■ 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.