Translation
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes. In the event of any
discrepancy between this translated document and the original Japanese document, the latter shall prevail.

Summary of Non-Consolidated Financial Results
for the Year Ended December 31, 2022
(Based on Japanese GAAP)
February 14, 2023
Company name:

DAIWA INDUSTRIES LTD.

Stock exchange listing: Tokyo
Stock code:
6459
Representative:
Inquiries:

URL

http://www.drk.co.jp

President and Representative Director
General Manager of Accounting Division

Atsushi Ozaki
Kiichiro Sokooshi

Scheduled date of ordinary general meeting of shareholders:
Scheduled date to file Securities Report:

March 30, 2023
March 31, 2023

Scheduled date to commence dividend payments:
Preparation of supplementary material on financial results:

March 31, 2023
No

Holding of financial results meeting:

NoTEL

06-6767-8171(Amounts less than one million yen are rounded down)
1. Non-consolidated financial results for the year ended December 31, 2022 (from January 1, 2022 to December 31, 2022)(1) Non-consolidated operating resultsPercentages indicate year-on-year changes
Net salesYear ended December 31, 2022
Year ended December 31, 2021

Millions of yen
43,942
43,979Operating profit% Millions of yen
(0.1)
6,985
10.5
6,266

Diluted earnings pershare
Yen
Yen
87.90
–
70.63
–

Earnings per share
Year ended December 31, 2022
Year ended December 31, 2021

Ordinary profit
%
11.5
24.3

Millions of yen
6,866
6,128

Profit/equity

Profit%12.1
25.8

Millions of yen
4,446
3,610%
23.1
15.2

Ordinary profit/total Operating profit/net
assetssales%%%
6.88.1
15.9
5.2
7.5
14.2

(2) Non-consolidated financial position
Total assets
As of December 31, 2022
As of December 31, 2021

Net assets

Equity ratio

Millions of yen
86,071
82,719Millions of yen
60,19669,789Cash flows fromoperating activities
Millions of yen
4,293
6,431

Cash flows frominvesting activities
Millions of yen(1,141)(3,137)

Net assets per share%
69.9
84.4

Yen
1,219.43
1,367.13(3) Non-consolidated cash flows

Year ended December 31, 2022
Year ended December 31, 2021

Cash flows from
Cash and cash equivalents
at end of period
financing activities
Millions of yen
Millions of yen(3,386)
53,667(1,658)53,902

2. Cash dividends
Annual dividends per share
1st quarter-end 2nd quarter-end 3rd quarter-end Fiscal year-end

Year ended December 31, 2021
Year ended December 31, 2022
Year ending December 31, 2023
(Forecast)

Total cash
dividends (Total)

Total

Dividend payout
ratio (Nonconsolidated)

Ratio of dividends
to net assets (Nonconsolidated)

Yen

Yen

Yen

Yen

Yen

Millions of yen%%

––

15.00
15.00

––

15.00
15.0030.00
30.00

1,532
1,506

42.5
34.1

2.2
2.3

–

15.00

–

15.00

30.00

133.5

3. Forecast of non-consolidated financial results for the year ending December 31, 2023 (from January 1, 2023 to December 31, 2023)
Percentages indicate year-on-year changes
Net sales
Millions of yen
Six months ending
June 30, 2023
Full year

Operating profit

Ordinary profit

ProfitEarnings per share% Millions of yen% Millions of yen% Millions of yen%Yen

21,500

1.9

3,390

1.9

3,330

1.7

2,010

1.6

39.74

44,800

2.0

7,120

1.9

7,000

1.94,530

1.9

89.56

4. Notes(1) Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial statements
Changes in accounting policies due to revisions to accounting standards and other regulations:
Changes in accounting policies due to other reasons:

Yes
No

Changes in accounting estimates:
Restatement of prior period financial statements:

NoNo(2) Number of issued shares (common shares)
Total number of issued shares at the end of the period (including treasury shares)
As of December 31, 2022

51,717,215 shares As of December 31, 2021

51,717,215 shares

Number of treasury shares at the end of the period
As of December 31, 2022

2,352,591 shares As of December 31, 2021

669,136 shares

Average number of shares during the period
Year ended December 31, 2022

50,582,232 shares Year ended December 31, 2021

251,123,030 sharesNon-consolidated financial statements
Non-consolidated balance sheets(Thousands of yen)
As of December 31, 2021

As of December 31, 2022

AssetsCurrent assets
Cash and deposits
Notes receivable - trade55,102,585
2,113,143

53,867,822
1,339,050

Accounts receivable - trade
Securities

3,160,394
100,009

3,063,216–

Merchandise and finished goods
Work in process

1,095,044
291,446

1,519,989
444,206

Raw materials and supplies
Service parts

723,179
190,117

830,721
197,258

Prepaid expenses
Other

241,084
127,951

242,324
651,474

Allowance for doubtful accounts(1,078)(901)

63,143,876

62,155,162

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

10,525,790

10,534,992

Accumulated depreciation(7,111,454)(7,284,278)

Buildings, net

3,414,336

3,250,713

819,229

822,129

Accumulated depreciation(692,540)(711,031)

Structures, net

126,689

111,098

Structures

Machinery and equipment
Accumulated depreciation
Machinery and equipment, net
VehiclesAccumulated depreciation
Vehicles, net

6,360,322

6,516,422(5,534,486)(5,686,865)

825,835

829,557

71,731

73,225(66,446)(69,369)

5,284

3,856

Tools, furniture and fixtures

3,531,098

3,570,180

Accumulated depreciation(3,285,566)(3,416,405)

Tools, furniture and fixtures, netLandConstruction in progress

245,532

153,775

5,862,840

5,926,210

81,150215,986

10,561,670

10,491,198

SoftwareTelephone subscription right

128,184
8,726

118,625
8,726

Total intangible assets

136,911

127,352

Total property, plant and equipment
Intangible assets3

(Thousands of yen)
As of December 31, 2021

As of December 31, 2022

Investments and other assets
Investment securities
Distressed receivables

281,816
63,124447,335
61,250Long-term prepaid expenses
Deferred tax assets

75,952765,673

63,423
3,528,259

Leasehold and guarantee depositsLong-term time deposits

250,249
7,500,000

255,945
9,000,000

Other
Allowance for doubtful accounts

4,521(64,321)

4,521(63,047)

Total investments and other assets

8,877,015

13,297,687

19,575,597

23,916,238

82,719,473

86,071,401

3,189,611

3,281,914

Accounts payable - trade
Accounts payable - other

2,630,680
1,009,966

3,018,725
1,052,686

Accrued expenses
Income taxes payable

25,785
1,306,720

26,264–

Advances received
Deposits received

426,760
552,064–
658,469

Unearned revenue
Contract liabilities1,380,955––
17,008,688

Provision for bonuses
Provision for bonuses for directors (and other officers)

169,694
30,750174,166
29,950

Provision for product warranties
Other

208,869
597,077

163,42247,883

11,528,936

25,462,172

13,416

6,416

1,378,356

394,023

9,166

12,049Total non-current assets
Total assets
Liabilities
Current liabilities
Notes payable - trade

Total current liabilities
Non-current liabilities
Provision for retirement benefits
Provision for retirement benefits for directors (and otherofficers)
Other
Total non-current liabilities
Total liabilities

4

1,400,940

412,489

12,929,876

25,874,662

(Thousands of yen)
As of December 31, 2021

As of December 31, 2022

Net assets
Shareholders' equity
Share capital

9,907,039

9,907,039

Capital surplus
Legal capital surplus

9,867,880

9,867,880

Total capital surplus

9,867,880

9,867,880

Retained earnings
Legal retained earnings

578,170

578,170

Other retained earnings
General reserve

14,170,382

14,170,382

35,800,793

28,033,807

50,549,346

42,782,360(578,678)(2,437,233)

69,745,587

60,120,046

44,00976,69144,00976,691

69,789,596

60,196,738

82,719,473

86,071,401

Retained earnings brought forward
Total retained earnings
Treasury shares
Total shareholders' equity
Valuation and translation adjustments
Valuation difference on available-for-sale securities
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets

5Non-consolidated statements of income(Thousands of yen)
Fiscal year ended

Fiscal year ended

December 31, 2021

December 31, 2022

Net sales
Net sales of finished goods

29,009,669

22,697,400

Net sales of goods
Sales of service parts

10,556,726
4,240,420

11,706,487
9,355,756

Other sales

172,568

183,212

Total net sales

43,979,385

43,942,856

Cost of sales
Cost of finished goods soldBeginning finished goods inventory

1,504,566

1,059,293

Cost of products manufactured

11,288,674

10,502,154

Total

12,793,241

11,561,448

5,136

2,517

Transfer to other accountEnding finished goods inventory

1,059,293

1,428,291

Cost of finished goods sold11,728,811

10,130,639

Beginning merchandise inventory
Cost of purchased goods

13,542
5,583,657

35,7506,751,031

Total

5,597,199

6,786,781

Cost of goods soldEnding merchandise inventory

35,75091,697

Cost of goods sold5,561,449

6,695,083

Cost of service parts sold1,786,184

2,611,780

59,691

54,584

19,136,135

19,492,087

24,843,250

24,450,768

128,527

119,357

2,189,511
251,087

2,107,009
183,885100
208,869–
163,4229,165,220
141,325

8,462,424
134,50230,75029,95037,45525,870

Other costs
Total cost of sales
Gross profit
Selling, general and administrative expenses
Advertising expenses
Transportation and storage costs
Product warranty expenses
Provision of allowance for doubtful accounts
Provision for product warranties
Remuneration, salaries and allowances
Provision for bonuses
Provision for bonuses for directors (and other officers)
Provision for retirement benefits for directors (and otherofficers)
Welfare expenses

1,533,465

1,450,941

Travel and communication expenses
Supplies expenses

910,258
230,416

953,071
213,375

Rent expenses
Vehicle expenses

901,451
371,230

907,230
373,463

Depreciation
Other259,746
2,217,731

245,8142,095,030

Total selling, general and administrative expenses

18,577,147

17,465,348

6,266,102

6,985,420

Operating profit

6

(Thousands of yen)

Non-operating income
Interest income

Fiscal year ended

Fiscal year ended

December 31, 2021

December 31, 2022

12,512

13,980Interest on securities
Dividend income

6,382
12,961

189
13,875Compensation income
Gain on sale of scraps

64,80522,97147,72528,759Rental income from real estate
Miscellaneous income

17,44857,87817,96827,670Total non-operating income

194,960

150,170

Non-operating expenses
Compensation expenses

36,10528,800Loss on scrap sales
Miscellaneous losses

276,440
20,215

218,491
21,409Total non-operating expenses

332,761

268,701

6,128,302

6,866,889

Gain on sale of non-current assets
Gain on sale of investment securities

199
56,420558–

Total extraordinary income

56,619558

4,015304

Ordinary profit
Extraordinary income

Extraordinary losses
Loss on retirement of non-current assets
Loss on revision of retirement benefit plan

935,647–

Total extraordinary losses

939,662

304

Profit before income taxes5,245,259

6,867,144

Income taxes - current

1,907,317

488,196

Income taxes - deferred(273,049)

1,932,798

Total income taxes

1,634,267

2,420,995

Profit3,610,991

4,446,1487

Non-consolidated statements of changes in equity
Fiscal year ended December 31, 2021
(Thousands of yen)
Shareholders' equity
CapitalsurplusRetained earnings
Other retained earnings

Share capital

Balance at beginning ofperiod

Legal capital Legal retained
surplusearnings

Reserve forspecial
depreciation

Generalreserve

Retainedearnings
brought
forwardTreasurysharesTotalshareholders'equity9,907,039

9,867,880

578,170

48,952

14,170,382

33,675,308(450,582)

67,797,150

9,907,039

9,867,880

578,170

48,952

14,170,382

33,675,308(450,582)

67,797,150

Cumulative effects ofchanges in accounting
policies
Restated balance
Changes during period
Dividends of surplus
Reversal of reserve for
special depreciation(48,952)

Profit(1,534,459)(1,534,459)

48,952–

3,610,991

3,610,991

Purchase of treasury shares(128,095)

Net changes in items otherthan shareholders' equity
Total changes during period
Balance at end of period––––(48,952)–

2,125,484(128,095)

1,948,436

9,907,039

9,867,880

578,170–

14,170,382

35,800,793(578,678)

69,745,587

Valuation andtranslation
adjustments
Valuationdifference on
available-forsale securities
Balance at beginning of
periodTotal net
assets47,922

67,845,073

47,922

67,845,073

Cumulative effects ofchanges in accounting
policies
Restated balance(128,095)

Changes during period
Dividends of surplus(1,534,459)

Reversal of reserve for
special depreciation–Profit

3,610,991

Purchase of treasury shares(128,095)

Net changes in items otherthan shareholders' equity(3,913)(3,913)

Total changes during period(3,913)

1,944,523

Balance at end of period

44,00969,789,596

8Fiscal year ended December 31, 2022
(Thousands of yen)
Shareholders' equity
CapitalsurplusRetained earnings
Other retained earnings

Share capital

Balance at beginning ofperiod

9,907,039

Legal capital Legal retained
surplusearnings

9,867,880

578,170

Reserve for
specialdepreciation–Generalreserve

Retainedearnings
brought
forward14,170,38235,800,793

Cumulative effects ofchanges in accounting
policies
Restated balance

Treasuryshares(578,678)(10,681,693)
9,907,039

9,867,880

578,170–

14,170,382

25,119,099

Total
shareholders'equity

69,745,587(10,681,693)(578,678)

59,063,893

Changes during period
Dividends of surplus(1,531,440)(1,531,440)

Reversal of reserve for
special depreciation–

Profit

4,446,148

Purchase of treasury shares

4,446,148(1,858,554)

Net changes in items otherthan shareholders' equity
Total changes during period
Balance at end of period

–––––

–

2,914,707(1,858,554)

1,056,153

9,907,039

9,867,880

578,170–

14,170,382

28,033,807(2,437,233)

60,120,046

Valuation andtranslation
adjustments

Balance at beginning of
periodValuationdifference on
available-forsale securities

Total net assets

44,00969,789,596

Cumulative effects ofchanges in accounting
policies
Restated balance(1,858,554)(10,681,693)
44,00959,107,903

Changes during period
Dividends of surplus(1,531,440)

Reversal of reserve for
special depreciation–

Profit

4,446,148

Purchase of treasury shares(1,858,554)

Net changes in items otherthan shareholders' equity

32,682

Total changes during period

32,682

1,088,835

Balance at end of period

76,69160,196,738

32,682

9Non-consolidated statements of cash flows(Thousands of yen)

Cash flows from operating activities
Profit before income taxes

Fiscal year ended

Fiscal year ended

December 31, 2021

December 31, 2022

5,245,259

6,867,144

Depreciation
Increase (decrease) in allowance for doubtful accounts

801,339(81,291)

690,555(1,450)

Increase (decrease) in provision for bonuses
Increase (decrease) in provision for bonuses for directors (and10,985

4,472(2,700)(800)

30,980(45,447)

19,734(7,000)34,455(984,333)

other officers)
Increase (decrease) in provision for product warranties
Increase (decrease) in provision for retirement benefits
Increase (decrease) in provision for retirement benefits for
directors (and other officers)
Decrease (increase) in prepaid pension costs(169,791)–

Interest and dividend income
Loss (gain) on sale of property, plant and equipment(31,856)(199)(28,045)(558)

Loss (gain) on sale of short-term and long-term investment
securities(56,420)–

Loss on retirement of property, plant and equipment
Loss on revision of retirement benefit plan

4,015
935,647304–

Decrease (increase) in trade receivables
Decrease (increase) in inventories(120,092)
345,833

870,329(692,388)

Increase (decrease) in trade payables
Other, net

348,176
485,308

480,348(782,914)

Subtotal

7,799,383

6,370,214

Interest and dividends received
Income taxes paid

33,642(1,401,120)

29,164(2,105,975)

Net cash provided by (used in) operating activities

6,431,905

4,293,403(2,700,000)(1,700,000)

200,000(2,194,694)

1,200,000(559,132)200(15,890)559(41,642)–1,500,000(121,298)
100,000

75,620(2,996)

2,872(22,892)(3,137,761)(1,141,534)

Cash flows from investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from sale and redemption of securities
Proceeds from sale and redemption of investment securities
Other, net
Net cash provided by (used in) investing activities
Cash flows from financing activities
Purchase of treasury shares(128,095)(1,858,554)

Dividends paid

(1,530,873)(1,528,142)

Net cash provided by (used in) financing activities(1,658,969)(3,386,697)–64

Net increase (decrease) in cash and cash equivalents

1,635,174(234,763)

Cash and cash equivalents at beginning of period

52,267,410

53,902,585

Cash and cash equivalents at end of period

53,902,585

53,667,822

Effect of exchange rate change on cash and cash equivalents

10