Alpha-Win Company Research Report
PCA(9629 TSE Prime)● SummaryIssued: 12/15/2023

Alpha-Win Capital Research Department
https://www.awincap.com/

Business Description
・ PCA CORPORATION (hereinafter, the “Company”) is an independent software manufacturer specialized inpackaged enterprise system software. It is a major specialized player in the industry.
・The Company was founded in 1980. Since then, it has been providing on-premises or cloud-based software mainly
to small/medium-sized companies. The Company’s mission is to contribute to society as a “Management Support
Company” that supports the smooth management and operation of companies, with a focus on providing enterprisesystem software that realizes high levels of automation.

Financial Results for the First Half
・In the first half of FY2024 (April to September 2023; note that the Company’s fiscal year is March-ending, i.e.,
FY2024 ends in March 2024)), the Company posted sales of 7,074 million yen (+14.8% YoY), operating profit of998 million yen (+17.8% YoY), and net profit of 660 million yen (+33.5% YoY). Although the Company does notdisclose its forecast for the first half, the results seem to have exceeded its internal forecasts. Compared to theCompany’s full-year plan, progress in the first half was 48.1% for sales, 69.1% for operating profit, and 71.4% fornet profit, showing strong progress with the profits.
・Of the amount of sales growth in the first half (+911 million yen YoY), approximately 64% was attributable to theincrease in the cloud service’s sales (+583 million yen YoY). The quarterly sales growth rate of the cloud service
had previously temporarily declined, but the further shift from the products to the cloud and the demand related to
the new invoicing system have led to a high growth rate again (+20% compared to the previous first half). Since thisservice has a high marginal profit ratio, it has most likely significantly contributed to improving the profits, too. The
number of corporate users of the PCA Cloud has increased steadily to 22,238 as of the end of first half, having
increased by 1,216 (+5.8%) during the six months since the end of the previous fiscal year and by 2,385 (+12.0%)
during the 12 months since the end of the first half of the previous fiscal year.
・The demand related to the new invoicing system also provided a tailwind for the solutions (regarding its peripheralservices) and the products, resulting in sales growth of 168 million yen (+20.2% YoY) and 156 million yen (+28.1%
YoY), respectively.
・The Company revised the prices of its current products and services in July 2023 (raised prices by about 20%), which
contributed to sales growth for about three months of this first half.
・The gross margin was 62.6%, down 0.9 percentage point from the previous first half. This was due to an increase in
the cost of manufacturing, mainly for the subcontracting and development costs. SG&A expenses increased by 365
million yen, mainly due to personnel expenses for increasing the number of employees, sales promotion expenses
for holding events, R&D expenses, and system usage fees. However, the rate of increase in SG&A expenses was
11.9%, which was 2.9 percentage points below the rate of sales growth. Consequently, the SG&A expense ratio
declined by 1.2 percentage points from 49.7% to 48.5%.
・As a result, the operating margin improved by 0.4 percentage point, from 13.7% to 14.1%.
Financial Forecast for This Fiscal Year・The Company maintained its initial forecasts for the current fiscal year (FY2024), which have been made at the
beginning of the fiscal year. It expects sales of 14,700 million yen (+13.2% YoY), operating profit of 1,445 million
yen (+12.2% YoY), net profit of 925 million yen (+4.8% YoY), and an annual dividend of 17 yen per share. Sales
are expected to hit a record high for the first time in four years since FY2020.
・Subtracting the first-half results from the full-year forecasts shows that, in the second half, the Company expects
sales of 7,626 million yen (+11.9% YoY), operating profit of 447 million yen (+1.4% YoY), and net profit of 265
million yen (-31.9% YoY). It expects sales to increase and profits to decline. The operating margin is expected todecrease from 6.5% in the previous fiscal year’s second half to 5.9%.
・In the second half, the Company expects to achieve a double-digit sales growth by capturing the DX needs of users,
mainly through the sales expansion of the Hub series and the increasing demand related to the revised Electronic

1/42This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate, or fit
for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting from the use ofor reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual property of thisReport belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

Books Preservation Act in addition to the new invoicing system. The Company expects operating profit to increase
only slightly due to accelerated development to strengthen the Hub series’ lineup and greater promotion including
online advertising. However, net profit for this second half is expected to decline significantly. This is because in
the previous second half, the tax rate (income taxes, etc.) had been low due to the application of tax effect accounting.

Alpha-Win Research Department’s Forecast of Financial Results
・We had expected the full-year results to be somewhat greater than the Company’s plan, but we have now revised
our forecasts upward, taking into account the strong first-half results and the Company’s conservative estimates forthe second half. The new forecasts, which further exceed the Company’s plan, are as follows: sales of 14,900 million
yen (+200 million yen or +1.4% compared to the Company’s plan), operating profit of 2,000 million yen (similarly,+555 million yen or +38.4%), and net profit of 1,220 million yen (similarly, +295 million yen or +31.9%). In linewith these revisions, we also raised our dividend forecast from 17.0 yen/share to 19.0 yen/share.
・These upward revisions have been made due to the following reasons: (1) strong demand for systems to comply with
the new invoicing system has been leading to solid sales of the related products and services; (2) stable sales growthhas been maintained due to the further shift to the cloud; (3) a certain level of demand is expected in the second half
in relation to the revised Electric Books Preservation Act; (4) the potential increase in costs such as R&D investments,
personnel expenses, and sales promotion expenses seems to be factored into the plan already; (5) progress has beenstrong in the first half for the profits; and (6) the Company’s assumptions and estimates for the second half’s sales,
costs, and profits seem conservative.
・We have also reviewed our forecasts for the next fiscal year (FY2025) and the fiscal year after the next (FY2026).
We revised the forecasts for both of their sales and profits upward, such that sales and profits will increase by around
5% in both fiscal years, which will also lead to increases in dividend.
・The main reasons for these are the following: (1) continued solid growth of the cloud service is expected; (2) the
new services are expected to start making full-scale contributions to earnings; (3) the price revisions will contributeto the next fiscal year’s results over the entire year; (4) in the fiscal year after the next, the upfront investment costs
related to greater investment in the development of services and products are expected to peak out; and (5) the
increase in general expenses due to inflation, such as personnel expenses and subcontracting costs, are expected toease in the fiscal year after the next.
・On the other hand, the risk factors include a delayed contribution to earnings by the new businesses, such as the PCA
Hub series and the acquired company Dreamhop’s business, and a decline in earnings following the period of demandbrought by the two major law changes (the invoicing system and the Electronic Books Preservation Act), as well asplans to intentionally increase upfront investments and general costs.

・We expect that the annual profit growth rate over the medium to long term will be 5-8% (on a normalized basis
excluding any event-driven high demand), since we expect sales, profit, and dividend to increase as the cloudbusiness continues to support the Company’s growth.
Competitiveness・The Company has a customer base of approx. 240,000 companies. It has a high brand recognition and top-levelmarket share for accounting and finance software targeting small/medium-sized companies. It is especially taking alead with enterprise system cloud services in those fields and has been steadily expanding its business.
・Its strength is its concentration of resources in its field of expertise as a specialist, enabling the development of
products and services that meet various customer needs ahead of its competitors, including needs related to changes
in tax and other regulations. It also has a stable customer base and can provide high-quality products and services atreasonable prices.
Business Strategy
・The Company has announced a medium-term management plan for the three years starting last fiscal year. Numericaltargets for the final year or FY2025 (next fiscal year) are as follows: sales of Y15 billion or more (of which,subscription-based sales are Y9.5 billion or more), consolidated operating profit of Y2.5 billion or more (consolidated
profit margin of 16% or more), ROE of 10% or more, DOE of 2.5%, and dividend payout ratio of 30%. Excluding
sales, all figures have mostly been achieved in the past already.
・The goals for sales and dividend payout ratio are well within the range of achievement. The goals for operating profit,
ROE, and DOE were initially thought to be conservative targets, but they now seem to be somewhat high hurdles
2/42This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate, or fit
for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting from the use ofor reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual property of thisReport belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

since they have each been deviating from the current plans for this fiscal year. However, depending on cost controls,
operating profit should also be within an achievable range.
・The PCA Group’s growth strategy is to provide total solution services centered on software. It is executing fourpriority measures (establishing a strong revenue base for the core businesses; creating new business opportunities;
strengthening monozukuri or the creation of things with a focus on safety, security, and anticipation of needs; andestablishing a highly profitable and sustainable management foundation). It plans to proactively work on the SDGs
while expanding its subscription business, strengthening its product development capacity, and meeting digitalizationneeds.
・On the other hand, its biggest challenges are to effectively utilize its abundant cash and deposits (which exceed its
annual sales) for future growth and to put onto track and monetize the new businesses that it has started (PCA Hub,
PCA Subscription, hyper, and the healthcare business).

Stock Characteristics and Price
・ The Company is seen as a defensive, domestic-demand-oriented, and small-cap growth stock that is positively
impacted by the work-style reform and tax reforms, with anticipation of continued business growth mainly with thesubscription businesses. However, the volatility of business performance and stock price tends to increase before andafter periods of event-driven high demand.
・Over the past seven and a half years, the Company has outperformed the TOPIX and its competitors. On the contrary,
it has been underperforming them since the beginning of the year.
・The valuation of the Company’s stock based on this fiscal year’s forecasts is somewhat overpriced compared to theaverage of all stocks listed on the Tokyo Stock Exchange’s Prime Market and compared to its competitors.
・ However, its business is mainly subscription-based and is therefore stable and maintainable. The subscription
business also has a high growth potential, so continued growth of sales and profit is anticipated in the next fiscal year
and beyond. Since EPS growth and subsequent dividend hikes are expected, we believe that there is an upside to thestock price over the medium to long term.
・ For the time being, the stock price will likely be affected by the quarterly trends in business performance andespecially by the financial results of this full fiscal year (deviation from the current forecast). It may also be impacted
by whether the new businesses will succeed (especially PCA Hub and the healthcare business of Dreamhop), thegrowth rate of the cloud business, and whether its financial performance will be impacted by changes in the tax
system or accounting system (especially the new invoicing system and the Electronic Books Preservation Act).
Return of Profit to Shareholders
・The Company has been stably paying dividend and has bought back its shares several times. The dividend payout
ratio was 38.5% in FY2023 (last fiscal year’s result) and is expected to be 38.3% for this fiscal year (the Company’s
forecast), both exceeding the target ratio (30%). Meanwhile, we estimate that forecasted DOE for this fiscal year
(based on the Company’s forecast) is 1.9%, falling below the target of 2.5%.
・Since business performance is expected to grow in the next fiscal year and beyond as well, we anticipate that theCompany may further enhance its shareholder returns through dividend hikes, share buybacks, or other means.
【 9629 PCA

Sector: Information & Communication 】 Figure A

FY

Sales

YoY

O.P.
(million yen)(million yen)

（%）

2020
2021
2022
2022
2023
2024
2024
2024
2025
2025
2025
2026
2026
2023

Old Standard
Old Standard
Old Standard
New Standard
New Standard
CE: New Standard
New E: New Standard
Old E: New Standard
CE Medium-Term Plan: New Standard
New E: New Standard
Old E: New Standard
New E: New Standard
Old E: New Standard
Q1: New Standard

14,266
13,30815,142
13,382
12,981
14,70014,90014,80015,00015,52015,52016,50016,500
2,954

24.7
-6.7
13.8
0.6
-3.0
13.2
14.8
14.0
2.0
4.2
4.9
6.3
6.3
-11.2

2,781
2,314
2,516
2,655
1,288
1,445
2,000
1,570
2,500
2,100
1,700
2,250
1,800
309

2024

Q1: New Standard

3,387

14.7

2023
2024
2023
2024
2023
2024

Q2: New Standard
Q2: New Standard
H1: New Standard
H1: New Standard
H2: New Standard
H2 CE: New Standard

3,209
3,687
6,163
7,074
6,818
7,626

-2.2
14.9
-6.7
14.8
0.7
11.9

YoY

R.P.

（%）

(million yen)

YoY

N.P.

（%）

(million yen)

YoY

EPS

BPS

Dividend
（Y ）

（%）

(Y )

(Y )

122.8
-16.8
8.7
14.7
-51.5
12.2
55.3
21.9
73.0
5.0
8.3
7.1
5.9
-68.3

2,808
2,340
2,542
2,697
1,326
1,478
2,030
1,600

119.9
-16.7
8.6
15.2
-50.8
11.4
53.1
20.7

1,816
1,668

100.4
-8.1

90.97
83.50

675.81
791.64

18.00
11.33

2,367
883
925
1,220
1,000

41.9
-62.7
4.8
38.2
13.3

118.36
44.16
46.27
60.90
49.92

847.14870.38912.77903.35

24.00
17.00
17.00
19.00
18.00

2,130
1,730
2,280
1,820
315

4.9
8.1
7.0
5.2
-68.0

1,280
1,080
1,350
1,135
142

4.9
8.0
5.5
5.1
-76.8

63.89
957.6653.91
939.3567.39 1,005.05
56.66
977.107.13
830.18

20.00
19.00
21.00
20.00
0.00

428

38.5

436

38.4

266

86.9

13.33

867.22

0.00

538
570
847
998
441
447

-30.8
5.9
-51.7
17.8
-51.1
1.4

556
590
871
1,026
455
452

-30.1
6.1
-51.1
17.8
-50.3
-0.7

352
394
494
660
389
265

-57.8
11.9
-65.9
33.5
-57.6
-31.9

17.60
19.67
24.73
33.00
19.45
13.27

850.85885.19
-

0.00
0.00
0.00
0.00
17.00
17.00

(Note) CE: the Company’s
estimate/forecast. E: Alpha-Win
Research Dept.’sestimate/forecast. Old E: previous
forecast. New E: forecast madethis fiscal year. Q1: April to June.
Q2: July to September. H1: April
to September. H2: October toMarch. Past years wereretroactively revised for the stock
split (3-for-1) conducted on
October 1, 2021 (for EPS, BPS,
and dividend). The AccountingStandard for Revenue
Recognition (ASBJ Statement No.
29), etc., have been applied
starting in FY2022. “OldStandard” is the previous
revenue-recognition standard.
“New Standard” is the newrevenue-recognition standard.

3/42This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate, or fit
for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting from the use ofor reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual property of thisReport belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023【 Stock Price and Valuation Indicators: 9629 PCA 】 Figure B
Item

12/15/2023

Item

P/E

P/B

Dividend Yield

Dividend Payout Ratio

Stock Price (Y)1,111

Forecast for Last FY

25.2

1.3

1.5%

13.6%

Shares Outstanding (thou.)

22,000

Forecast for This FY

18.2

1.2

1.7%

31.2%

Market Capitalization (million yen)

24,442

Forecast for Next FY

17.4

1.2

1.8%

31.3%

Dilutive Shares (thou.)0

Forecast for Fiscal Year After the Next

16.5

1.1

1.9%

31.2%

Equity Ratio at the End of This First Half

56.7

2.0%

Last FY’s ROE

5.1%

Last FY’s Dividend on Equity Ratio (DOE)(Note) Forecasts were made by Alpha-Win Research Dept.

【Stock Chart (end-of-week prices) : 9629 PCA】

Figure C

(Y)

2,500
2,300
2,100

5.00

Stock price (left axis)
Price relative to TOPIX (right axis)

4.50

1,900

4.00

1,700

3.50

1,500
1,300

3.00

1,100

2.50

900

2.00

700
500

1.00

08
/1
6
12
/1
04 6
/1
7
08
/1
7
12
/1
04 7
/1
8
08
/1
8
12
/1
04 8
/1
9
08
/1
9
12
/1
9
04
/2
0
08
/2
0
12
/2
04 0
/2
1
08
/2
1
12
/2
04 1
/2
2
08
/2
2
12
/2
04 2
/2
3
08
(M / 23
M
/Y
Y
)

300

1.50

【Performance】
PeriodReturn vs. TOPIX
1 month-5.3%-3.5%
3 months
-8.0%
-8.4%
6 months-18.7%-20.6%
12 months-17.2%-40.5%(Note) Reflects stock price and index values
through the closing price of 12/15/2023. The
return for the 1-month period is thecomparison between the closing price of thelast day of November and the closing price ofDec. 15. Similar for the other periods.
Prepared by Alpha-Win Research Dept.

(Note) From the fourth week of August 2016 to the third week of December 2023 (12/15)(Note) In the text and figures of this Report, the values for the same item may not match completely with each other or with the Company’s
announced values due to rounding, rounding during the calculation process, format of display, etc.

Disclaimer
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc.
(hereinafter “Alpha-Win”) on the request of the company presented in this Report.
This Report is not to be construed as a recommendation or solicitation of investment. Alpha-Win shall not beliable for any consequences including direct or indirect loss, lost profit, or damage resulting from the use of or
reliance on this Report. Investors who read this Report must make their own decisions on all investment mattersand take full responsibility regarding their investment.
This Report has been prepared with a focus on objectivity and neutrality based on the analysis of generally accessible
public information and supplemental information including interview(s) by the analyst. Alpha-Win, the writer, and/or
other persons involved in the publication of this Report may already hold, or buy and sell in the future, the stock of thecompany presented in this Report.
Contents of this Report are based on information current as of the issue date and are subject to change without
notice. For the latest (updated) report, please see our website (https://www.awincap.com/). We also do not
warrant or represent that the information in this Report is accurate, reliable, complete, appropriate, or fit forany purpose and do not accept any responsibility or liability.
Copyright of this Report belongs to Alpha-Win and no part of the publication may be copied, photocopied,cited, or translated without our consent.
For inquiries regarding this Report, please send us an e-mail to info@awincap.com. However, Alpha-Win and thewriter of this Report do not have any obligation to reply to inquiries.
F2023-12-21-0900

4/42This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate, or fit
for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting from the use ofor reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual property of thisReport belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

Contents
1．Company Overview ......................................................................................................................... P6
Major Specialized Player in the Enterprise System Software Industry ............................................... P6
2．Business Description and Business Model ..................................................................................... P9Enterprise System Software Crucial for Efficient Business Operations .............................................. P9
Highly Maintainable Business Model with High Marginal Profit Ratio ............................................. P9
Expansion of the Highly Stable and Profitable Subscription Businesses .......................................... P10
Cloud Business as the Growth Driver ................................................................................................ P11
PCA Hub Series ................................................................................................................................. P12
3．Shareholder Composition .............................................................................................................. P14
Major Shareholder Composition ........................................................................................................ P14
4．ESG and SDGs ............................................................................................................................... P16
Environment, Society, and Governance ............................................................................................. P16
5．History of Growth .......................................................................................................................... P17
Company History ............................................................................................................................... P17
Past Transition in Financial Results ................................................................................................... P17
6．Business Environment ................................................................................................................... P20
Trends of the Software Market .......................................................................................................... P20
Comparison with Competitors ........................................................................................................... P20
7．The First Half’s Results and This Fiscal Year’s Forecast .......................................................... P23
Results for the First Half of FY2024 (April to September 2023) ........................................................ P23
PCA’s Financial Forecast for FY2024 (this fiscal year) ...................................................................... P28
Alpha-Win Research Dept.’s Financial Forecast for FY2024 (this fiscal year) .................................. P31
8．Growth Strategy ............................................................................................................................. P33
Medium- to Long-Term Vision and Policy ........................................................................................ P33
Management Indicators Set as Goals ................................................................................................. P33
Alpha-Win Research Dept.’s Forecast of Medium-Term Financial Results ..................................... P34
9．Analyst’s View ................................................................................................................................ P37
PCA’s Strengths and Challenges ....................................................................................................... P37
Shareholder Return and Shareholder Benefit Program ...................................................................... P38
Stock Price and Factors that May Affect Stock Price ........................................................................ P40
Note: 1) Upon translating to English, when the page numbers differed from the original Japanese version, they were
adjusted to those of the English version of the report. 2) The Company’s fiscal year is March-ending, i.e., FY2024
ends in March 2024.

5/42This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

w Major specialized player in
the industry with 43 yearsof history, developing andproviding packaged
enterprise system software
for small/medium-sized
Japanese companies(1) Enterprise system: Part of acompany’s information systemthat deals with matters directly
related to business, such as
financial accounting, production
control, sales management,
inventory management,purchases, HR, and payroll. A
general term for back-officeapplications. Also called themission-critical system, it serves as
the important core system for
operations/services.
w The PCA Group iscomposed of the Company
and 3 subsidiaries.
Acquired Dreamhop but
sold Keepdata.
(2) Work management system:
Also called the attendance
management system, it
manages/utilizes various data on
working hours. Can automaticallyaggregate data such as working
hours and prepare data to linkwith payroll software. Provided as
an on-premises or cloud-based
system.

1. Company Overview◆ Major Specialized Player in the Enterprise System
Software Industry
PCA CORPORATION (hereinafter, the “Company”) is an independent,
mid-tier company in the software industry. Founded in 1980, it has 43 yearsof history. It is a specialist in developing and providing packaged software(software prepared for use in certain operations) for enterprise systems1,
such as those for accounting and tax. It is a major, specialized player forsuch software targeting small/medium-sized companies.
About 240,000 companies are active users of the Company’s products.
Sales toward ordinary companies comprise greater than 90% of total sales.
With regards to the size of the corporate customers, the Company isespecially strong in business toward small/medium-sized and mid-tiercompanies with 20 to 300 employees. 80% of the Company’s sales are
made through distributors (the remaining 20% are direct sales). Its
customers are diversified. By monetary value, many of its major customers
are large companies. Its largest customer has usually been Ricoh Co., Ltd.
(listed on the Tokyo Stock Exchange’s Prime Market; securities code 7752),
which accounts for about 25% of total sales. Its accounting software has
been implemented by over 8,000 public benefit corporations in total; it is
the top player in the market for these customers.
As of the end of November 2023, the Company’s group consists of a totalof four companies: the Company and three consolidated subsidiaries(Figure 1). It has 643 employees in total (as of last fiscal year’s end).
1. Xronos Inc. (development/sales of work management system2; business
was acquired in 2001 and the Company has an 80% stake)
2. KEC Corporation (implementation support for PCA’s products/services,
sales of business software, etc.; wholly owned and founded in 1998 by theCompany)
3. Dreamhop Co., Ltd. (mental-health-related business; acquired in October
2020; wholly owned)【Figure 1】Overview of the Three Consolidated Subsidiaries (Words in red indicate the main updates since the previous report)
Overview of Consolidated Subsidiaries
Company Name

1. Xronos Inc.

2. KEC Corporation

Main Office Location

Kanda Neribeicho, Chiyoda-ku, Tokyo

Fujimi, Chiyoda-ku, Tokyo (PCA Building)

Iidabashi, Chiyoda-ku, Tokyo

6 sales offices in Sapporo, Sendai, Nagoya, Osaka, Hiroshima, and Fukuoka

3 sales offices in Osaka, Nagoya, and Kyushu

Sales offices and bases in the 2 cities of Osaka and Yokohama

Work management (attendance management) systems, in-house development of time clocks, andtheir sales and maintenance services. Main services/products are X'sion, a cloud service, andXronos Performance, which is offered as a cloud service or as on-premises software.

Sales of packaged business software such as PCA Accounting and PCA Salary,
maintenance of network systems, software installation support, instructor support for
implementation, and various user support

HR/labor solutions and mental-health-related businesses (providing stress check tests and feedback forearly detection of persons with mental health problems, and providing services for preventing leave ofabsence and job separation), occupational health physician services (consultation with occupational
health physicians; the necessary amount of time can be chosen individually), harassment prevention (lawcompliance, liability insurance, and training), and health management (solutions such as revitalizing theorganization and improving productivity)*Number of users of Xronos Performance (million users): 1.7 ⇒ 1.9 ⇒ 2.5 ⇒ 2.6(As of Nov. 15, 2021 ⇒ May 9, 2022 ⇒ June 7, 2023 ⇒ Dec. 6, 2023; info on its website; thesame order applies below)
Number of companies using Xronos Performance: 9,385 (6/7/2023) ⇒ 10,149 (12/6/2023)

More than 20,000 companies (in Japan)

Business Description

Number of Customers

3. Dreamhop Co., Ltd.

1,500 companies; 10,000 offices; more than 1,000,000 users*Number of users of X'sion (persons): 431,784 ⇒ 515,412 ⇒ 682,465 ⇒ 755,708
Number of companies using X'sion: 4,406 (6/7/2023) ⇒ 4,938 (12/6/2023)

Main Customers

FoundedPCA Corporation, Miroku Jyoho Service, Ohken, Obic Business Consultants, and Mitsubishi
Electric IT Solutions (companies or end users: Hatchando, Sanyo Foods, Shabondama Soap,
Sembikiya Fruit, Amanoya, FujiContact, and more)

May 2011 (business acquired)Companies that use software and other products manufactured and sold by PCA
Corporation

PCA Corporation; Hongo Tsuji Tax & Consulting; Ministry of Health, Labour and Welfare; Ministry of
the Environment; Ministry of Land, Infrastructure, Transport and Tourism; Tokyo Metropolitan
Government; Kanagawa Prefecture; Saitama Prefecture; Chiba Prefecture; City of Yokohama; Osaka
City; City of Sapporo; various other government organizations and companies of the private sector.
Used by companies and organizations of a scale of 10-100,000 people.

April 1988

October 2020 (date acquired; founded in June 2005)

Capital (million yen)60

1096.5 (capital increased from 56.5 million yen)

PCA's Stake

80%

100%

100%

Number of Employees(as of the end of Mar. 2023)

120 (most recent number according to its website as of 12/10/2023)

45

16

Sales (for the most recent period)

Y2,528 million (FY ended March 2023; information on its website; +15% YoY sales growth)

Not dislocsed

Not disclosed

Management Policy

Formulates its own medium-term plan: working on "investments for future growth" and"steady performance growth"Same as PCA

Category of Consolidated Sales

Mostly product sales and cloud sales, plus maintenance and other operating revenue

Mostly other operating revenue, plus products, merchandise, maintenance, and cloud

Other operating revenue

Website URL

https://www.xronos-inc.co.jp/

https://www.kec-sp.com/page1

https://www.dreamhop.com/

Trends in Business Performance andRecent Situation

Same as PCA

Intense competition, but since it is a growing market, there is potential for development in areas
Business performance tends to be basically linked with the performance of PCA. Due to the Strengthening projects for the private sector through collaboration with PCA; started providing groupsuch as construction. Solid business performance among the consolidated subsidiaries.
COVID-19 crisis, its business performance had been somewhat stagnant, but now seems to analysis and consulting services for stress checks as well; expanding business into areas with added value.
Profitability seems high. Working on shifting to the cloud, strengthening related services, andbe recovering.
However, it still seems to be posting a net loss due to upfront investments.
acquiring new customers.

(Ref) Prepared by Alpha-Win Research Dept. based on each company’s website and securities report and interview with the Company. Eachcompany’s performance trends include estimates by Alpha-Win.

6/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023
The Company acquired Keepdata Ltd. in March 2019 as a consolidated
subsidiary, aiming to create a foothold for the data utilization business.
However, linking systems with the Company and creating synergy in sales
had turned out to be difficult, and Keepdata had been continuously postinga net loss and an excess of debt. Therefore, in December 2020, theCompany sold all shares of Keepdata to a third party.
The ratio of consolidated sales to parent company’s sales has stably
remained around 1.1-1.2, indicating that the parent company’s financial
results have a greater weight (Figure 2).

w Consolidated-to-parentcompany sales ratio has
stably been around 1.1-1.2.
The summed recurring
profit of the consolidated
subsidiaries (consolidated
minus parent) has been asurplus.

Although each subsidiary’s profit/loss is not disclosed, the ratios of
consolidated to parent-company recurring profit have been in the range of
1.0-1.6 during the fiscal years that the Company has posted a net profit(including this fiscal year’s forecast).
Additionally, the summed profit/loss of the subsidiaries, calculated byconsolidated minus parent-company recurring profit, has been a surplus
since FY2016 (note that the Company’s fiscal year is March-ending;
FY2016 ended in March 2016) (Figure 3 on page 8).
Among the subsidiaries, Xronos seems to be continuing to contribute themost to the financial results, thanks to the work-style reform. Its sales were
1.5 billion yen in FY2019, 2.1 billion in FY2020, 2.16 billion yen in
FY2021, 2.21 billion yen in FY2022, and 2.53 billion yen in FY2023(+15% YoY). For FY2025, Xronos had expected its sales to be 4 billion
yen (according to Xronos’s former website). Although Xronos’s profit is
not disclosed, it has mostly likely been posting a profit like KEC andcontributing positively to consolidated profits.

w Xronos’s earnings growthis also presumed to becontributing to theconsolidated results.

【Figure 2】Ratio of Consolidated to Parent Company’s Sales (ratios shown on upper portion of graph)
Units: million yen

16,000
1.1

1.1

Sales of parent company

Consolidated sales minus parent company sales

1.1

1.1

1.1

1.1

14,000

1.1

1.1

1.2

1.2

1.3

887
3,023

1,167

12,0002,659

Consolidated
to parent
company
ratio

2,568

712

10,000

782
732

8,000

681

825

680

13,3796,000

10,727

9,693
4,000

7,487

7,761

FY2015FY2016

8,628

8,960

FY2017FY201812,141

10,723

10,413

FY2022

FY2023

11,6772,000
0FY2014FY2019FY2020

FY2021

FY2024 CE(Ref) Prepared by Alpha-Win Research Dept. based on the securities report. CE: the Company’s plan.

7/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023【Figure 3】Ratio of Consolidated to Parent Company’s Recurring Profit (ratios shown on upper portion of graph)
R.P. of parent company

Units: million yen

3,000

1.2

N.A

1.6

Consolidated R.P. minus parent company R.P.

1.1

1.0

1.2

1.2

1.2

1.2

402

2,500

Consolidated
to parent
company
ratio

1.1

1.3

115

329

1,211

1,149

FY2023

FY2024 CE

470
443

2,000

1,500

1,000

221

500

918

238

2,406

34

1,897

59

1,039

800

26

(139)

2,227

405

0
41

(19)
(500)
FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022(Ref) Prepared by Alpha-Win Research Dept. based on the securities report. CE: the Company’s plan.

The name of the Company comes from the five founders who were certified
public accountants (CPA); the letters CPA were shuffled into themeaningful name P (Professional) C (Computer) A (Automation).

w Founded by certified public
accountants

The Company’s financial standing is firm, rich in cash and debt-less.
Compared to its sales of 14.7 billion yen (this fiscal year’s plan) and total
assets of 31.3 billion yen, it has 18.9 billion yen in cash and deposits, whichis equivalent to 60% of total assets and 15.4 months’ worth of averagemonthly sales (values as of the end of September 2023). In addition, it owns
more than 2.8 billion yen in securities, which are mainly corporate bonds
and listed stocks.

w Rich in cash. Debt-lessmanagement.

Its free cash flow (FCF) has been positive except during a certain period,and cash and deposits on the balance sheet (B/S) have been generally
increasing (Figure 4). Regarding the financial ratios, its equity ratio is56.7% and current ratio is 210.6%, indicating financial soundness (as of theend of September 2023).

w FCF is positive. Thebalance of cash & deposits
is increasing and exceeding
annual sales. Its financial
standing its firm.

【Figure 4】Change in Cash Flow (CF) (units: million yen)
Units: million yen

FY2010FY2011FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021
1,632

FY2022

FY2023

FY2023 First Half
(Last first half)

FY2024 First Half
(This first half)

Operating CF ①

627

488

141

847

1,048

547

1,427

1,533

1,270

2,141

3,328

3,684

2,641

1,296

Investing CF ②

-405

-127

185

-407

-750

-606

-627

-395

1,715

-80

-719

253

708

-308

-266

Financing CF

-207

-210

-205

-215

-216

-284

-214

-215

-216

-572

-225

-355

-254

-606

-605

-457

FCF ( ①+②)

222

361

326

440

299

-60

800

1,137

2,985

2,061

2,609

1,885

4,392

2,333

1,030

1,559

Cash and Deposits (on B/S)

6,817

5,970

5,493

6,621

6,606

6,154

6,612

7,487

7,269

7,280

10,716

11,74916,09017,81916,51718,922(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary(Note) Cash and deposits shown are values from the balance sheet, not values used in the CF calculation.

8/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

1,203
356

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

2．Business Description and Business Modelw Enterprise systems are

mission critical. Stability
and reliability are crucial
elements since they areused inside companies.

◆ Enterprise System Software Crucial for Efficient
Business Operations
The Company’s core business is enterprise systems that support internalbusiness operations. Unlike systems that simply work on PCs, an enterprisesystem is a computer system that supports a series of processes throughout
all business operation flows within a company. Since it is mission-criticalfor business operations, it is required to be reliable, efficient, stable,
convenient, secure, and expandable.
The main methods for building an enterprise system are package-based
system development and original system development. Generally, themethod of combining sold packaged software into a system has advantages
such as short development time, cheapness, and having relatively few bugs.
On the other hand, its disadvantage is the difficulty in customizing thesystem to a company’s business characteristics, operations, management
styles, and other specific needs.
As for original software development and implementation, outsourced
development and in-house development are the two methods. In either case,the advantage of an original system is that it is easier to use since it can becustomized to a company’s needs and operations. However, development
cost and time are greater, and it will need revisions, addition of functions,and maintenance after implementation. Micro-sized, small-sized, mediumsized, and mid-tier companies especially tend to find the development,
implementation, and operation of original software difficult due to financial,staff, and time constraints.

w Provides originallydeveloped, packaged
enterprise system
software(3) Accounting software:
Application software for therecording, processing, andintegrated management ofaccounting data
(4) HR and payroll software:
Software for payroll calculationsand HR management

In response to this, the Company has been developing original enterprisesystem software that specifically meets the needs of one-person businesses
and micro-sized (SOHO), small-sized, medium-sized, and mid-tiercompanies in areas such as accounting3, finance, HR and payroll4, sales
management, purchase and inventory management, and tax. The enterprisesystem software is either packaged (on-premises: conventional products
operated in-house by a corporate user) or cloud-based (a service in which a
corporate user can use the enterprise system software via the Internet easily
and at a low cost without having to prepare its own server). The Company
sells and provides its software through either direct or indirect channels.
Additionally, the Company has not just been developing and sellingenterprise system software, but it has also been expanding its business byproviding proposal-based consulting services. With its subsidiaries, it has
also been providing various support services such as maintenance service
and implementation/operation support. Going forward, the Company plansto further strengthen these businesses.

◆ Highly Maintainable Business Model with High
Marginal Profit Ratio
The Company provides a total of about 60 to 70 software products andservices (counted by product name or service name, including options). Its
business model is based on the mass production of a limited number oftypes of products. Due to the nature of its business, its marginal profit ratio
is high.

9/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)
w 80% of sales come fromoriginally developed
products and services.

w Entry barrier is high sincecredibility and proven trackrecord are necessary.

Issued: 12/15/2023
Its original products and services (products/maintenance/cloud) account for
80% of total sales, while the remaining 20% are from other companies’
products (purchased merchandise) in the merchandise / other operating
revenue categories. From the development to the release of a new product,
approximately two years and a corresponding amount of cost are necessary.
Version upgrades (revision updates), which are prepared as needed, arereleased usually in a one- to two-year cycle. In recent years, however,software functions have become so enhanced that customers now tend topurchase less in response to this version upgrade cycle.
Since these types of software are related to operations that must be highly
reliable, and since software replacements give rise to issues of cost, labor,
and data continuity, their users show little interest in proactively or
frequently replacing their current software with an alternative of a different
company.
Therefore, customer loyalty and contract repeat rates are high (50% to 90%
or greater depending on the type of software). The barrier to market entry
is high because credibility and brand recognition are a must in this industry
and since companies have been able to adjust toward coexistence within themarket to a certain extent by taking strong positions in different niches.

◆ Expansion of the Highly Stable and Profitable
Subscription Businesses
w Sales are divided into fivecategories. Focused on thesubscription-based
businesses.

Until FY2016, sales and profit/loss had been disclosed for the four businesssegments of “for ordinary companies,” “for non-profit organizations,”“medical,” and “cloud.” Since FY2017, though, all business segments havebeen consolidated into one. Instead, sales are disclosed for five sales
categories (types): “products,” “merchandise,” “maintenance service,”“cloud service,” and “other operating revenue” (also called “solutions”)(Figure 5). Profit and loss by segment are no longer disclosed.

【Figure 5】Sales Classification (by category)Sales Classification by Category

Products
Merchandise
Maintenance Service
Cloud Service
Other Operating Revenue

Contents
Sales of original packaged software (accounting, sales management, purchasing and inventory management, payroll, HR, etc.)
Sales of other companies’ products such as ledger sheets
By signing up to PSS membership, users can receive inquiry and support services from call centers
Subscription service for software provided via the cloud
Sales of other companies’ products such as software/hardware combined with its original products; also called “solutions”

Total & Average
Reference

FY2024 First Half (results)
Sales (million yen)

% of Total Sales

Est. Gross Margin

713
198
1,715

10.1
2.8
24.2

About 60%
About 30%
About 70%

3,443
1,002

48.7
14.2

About 65%
About 50%

7,074

100.0 Result: 62.6%

Estimated weighted average: 62.6%(Ref) Prepared by Alpha-Win Research Dept. based on the securities report and interview. Gross margins have been estimated by Alpha-Win.
(Note) Maintenance service and cloud service are the subscription-based businesses.

w Subscription-based
businesses (maintenanceservice & cloud service)account for about 73% of
total sales.

In recent years, sales of the cloud service of the Company’s packaged
software have grown significantly, and they have become the Company’s
growth driver with regards to both the overall sales and profit. In the firsthalf of FY2024, sales of the cloud service were the largest among the sales
categories, followed by maintenance service. The sum of these twocategories, or subscription-based revenue (also called the “stock business”
in Japanese), accounted for about 73% of total sales. The maintenance andthe cloud services, with their high gross margins and contract repeat rates,
have been stable sources of profit and have been contributing to greater
stability of business and profit.
10/42

This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023
On the other hand, sales of products and solutions (other operating revenue)
tend to be impacted by event-driven high demand, replacement cycles, andversion upgrades.
Consolidated sales breakdown by the operation type of software is notdisclosed. However, sales are diversified, with the sales of accounting
software predicted to be the largest in proportion (about 15% of total sales),followed by software for sales management, purchase/inventory
management, and then lastly payroll and HR. The Company hascommented that the profit margins of each operation type of software do
not greatly differ between one another, but the main accounting software is
generally the most profitable.
The percentage of new software sales or version upgrade sales in the total
sales changes every year, but the percentage of version upgrades has always
been greater than 50%. Note that the Company’s on-premises products tend
to be installed and used by users on a single PC (stand-alone).

◆Cloud Business as the Growth Driverw Rapidly shifting from salesof packaged software to thecloud/subscription-based
business model

For many years, the Company had been focused on the business of selling
conventional packaged software, also known as on-premises software.
However, as the Internet became more sophisticated and widely used, it
predicted that the demand for cloud services will rise due to its convenienceand cost performance. Therefore, in 2008, the Company started providing
cloud services more than ten years ahead of its competitors. Since then, it
has been providing cloud versions of all of its on-premises software.

w The rapidly growing cloudbusiness is based on a
subscription-based, stablebusiness model. Taking alead in the market as the
single and obvious top
player, the Company has astrong competitive edge.

In the cloud business, users pay fees continuously for some span to use thesoftware (subscription model). Like the maintenance service, it is attractive
as a stable, subscription-based business model (average monthly fee of 2030 thousand yen per corporate user).

(5) API (Application
Programming Interface):
Interface/network to use
software; connects the softwareand the program.
(6) Kintone: Cloud service forbuilding business app on a web
database, provided by Cybozu.
Allows easy system building andlinkage with other systems.
(7) AWS: Stands for Amazon
Web Services; the collective
name for the cloud computing
services provided by Amazon.
The on AWS version enables theuse of PCA’s cloud services on
the AWS server.

Due to its cost structure, this business has relatively small variable costs
such as those for server maintenance, manufacturing, sales, and logistics.
It therefore has a high marginal profit ratio.
The Company leads the industry as the top player for cloud-based,
enterprise system software targeting small/medium-sized companies. In
recent years (2017-2018), its competitors have also entered the cloudmarket in full scale as their “first year of the cloud.” However, due to theadvantages and points of differentiation listed below, the Company is
expected maintain a competitive edge against its competitors for the
meanwhile.
・ Providing a wide variety of sophisticated software for business operations
・ Originally developed, open architecture; low cost・ Economies of scale are in effect, with more than 22,000 corporate users of
the cloud service already; well profitable.
・ Therefore, it has a very strong price advantage compared to competitors
・ More than ten years’ worth of operation expertise・ User-friendly, with WebAPI5 allowing linkage with other companies’
cloud services (linkage already possible with about 60 companies,
including Kintone6 of Cybozu)
・ In PCA Cloud on AWS7, service is available 24 hours, 365 days (maxnumber of licenses for simultaneous use expanded from 3 to 72 CAL).

11/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023
The Company has been focusing on cloud services for more than a decade,and both the number of corporate users and sales have been growing
steadily (Figure 6). The growth rate has slowed with the expansion ofbusiness scale, but in the previous fiscal year, this was probably partly inreaction to the previous event-driven high demand (the shift from the X
series, or the Company’s previous products, to the PCA Cloud). Since boththe sales and the net increase in the number of users are recovering on aquarterly basis (Figure 19 on page 25), the business will most likely
continue to be the growth driver.

【Figure 6】Change in the Number of Corporate Users of PCA Cloud (nonconsolidated figures)and Consolidated Sales of the Cloud
30,00025,00010,000

Sales of the cloud service (right axis: million yen)
Number of corporate users of the cloud service (leftaxis: companies)

As of the end of Sept. 2023
22,238 companies

9,000
8,000
7,000

20,0006,000
15,000

5,000
4,000

10,000

3,000
2,000

5,000

1,000
0

FY
20
08
FY
20
09
FY
20
10
FY
20
11
FY
20
12
FY
20
13
FY
20
14
FY
20
15
FY
20
16
FY
20
17
FY
20
18
FY
20
19
FY
20
20
FY
20
21
FY
20
22
FY
20
23
FY
20
24
E
FY
20
25
E
FY
20
26
E

0

(Ref) Prepared by Alpha-Win Research Dept. based on the Company’s financial results briefing materials and interview. “E”
represents estimates/forecasts made by Alpha-Win Research Dept.
(Note) Sales from FY2008 to FY2010 are not disclosed. The number of corporate users of the cloud service includes estimates.

◆PCA Hub Series
w The PCA Hub, centered on
PCA Hub eDOC service,
was started in March 2022.
Cloud service fordocument managementthat also supports theElectronic Books
Preservation Act.
(8) (PCA) hyper: New software
for mid-tier companies as a
successor to Dream21. A
superior version of the DX
series. A company can choose
flexibly between the on-premises
or the cloud version, depending
on its stage of growth. Its uniquefeature is that smooth linkage
can be made with other systems
using API, allowing streamliningof data management within a
corporate group (consolidated
accounting).

The PCA Hub service (hub as in “the center of something”) was started in
March 2022. PCA Hub is a series of new services that help small/mediumsized and mid-tier companies share core business data and shift to paperlessinternal operations and B2B transactions, thereby contributing to thedigitization of the Japanese society.
The concept of the PCA Hub series is “supporting companies and thesociety through technology.” Toward the creation of a sustainable society,the series will provide “levels of operation efficiency optimization that
seemed out of reach” at “prices within reach” for operational challenges
which have yet to be solved by systems due to investment costs being too
high.
As the first and the core service of the series, PCA Hub eDOC has beenreleased (PCA Hub eDOC is one of the PCA Hub services).
PCA Hub eDOC is an online storage service (cloud-based document
management service) that enables companies to safely and securely shareimportant business data and files internally. Also linked with the PCA DX
series and the hyper8 series, it is a tool for optimizing operation efficiency.

12/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023(9) [The revised] Electronic Books
Preservation Act: A law that allows
the storage of national-tax-related
books and documents as electronic
data. Came into effect in January
2022. Its purpose is to improve
productivity and convenience, as
well as promoting paperless
operation and remote work. Its grace
period will end at the end of 2023.
(10) JIIMA certification: “Legal
Requirements Certification Programfor Scan-Store Software in Applying
the Electronic Books Law” by theJapan Image and Information
Management Association (JIIMA).
Checks whether commerciallyavailable software meets therequirements of the Electronic Books
Preservation Act and certifies thosethat have been judged to meet thelegal requirements.
w The PCA Hub series is basedon monthly subscriptions.
Aiming for 2,000 users within
1 year after release (total of theentire PCA Hub series).
(11) New invoicing system: The
Qualified Invoice Preservation
Method, which was started in
October 2023, is a new system for
issuing and storing invoices anddelivery slips, created for the purposeof accurately recognizing the amountof consumption tax in transactions.

It enables the digitization and paperless operation of fund management,
accounting management, labor management, and more. It also supports therequirements of the Electronic Books Preservation Act9 and has acquired
the JIIMA certification10.
Following PCA Hub eDOC, the PCA Hub eDOC AI-OCR Option was also
released in November 2022 as part of the PCA Hub series (see Figure 7 forthe lineup of the PCA Hub series).
In addition to this, in March 2023, the Company released web-based
delivery services for invoices (such as the conversion of invoices toelectronic forms), including compatibility with electronic invoices, and forpay slips (pay slips, withholding tax slips, year-end adjustment notifications,etc.).
The PCA Hub series are cloud-based subscription services that charge
monthly fees and is highly expandable. Each service has a price plan basedon options such as the number of users, storage size, the number of
employees, and the number of invoices created, providing a pricing
structure that lowers the hurdle of starting software use. The Company aims
to gain a total of 2,000 corporate users within one year after the release of
the current three services (eDOC, Invoice, and Pay Slip) (sales target notdisclosed). Although it used to purchase and sell other companies’ software,
treating them as the solutions business, it now plans to sequentially develop
products in response to customer needs, switch to its original products, andprovide various peripheral services as the PCA Hub series. The Company
intends to develop this business into a stable revenue source.
For the Qualified Invoice Preservation Method (new invoicing system11)that started in October 2023, the Company released updated versions of its
current, major PCA products and services in the summer of 2023 that arecompatible with this system.

【Figure 7】Lineup of the PCA Hub Series and the Release Schedule Including the Conventional Products
Date

Service/productSituation

March 2022

PCA Hub

Released / Service started

A new service that supports mid-tier and small/medium-sized companies in shifting to paperless internal operations
and B2B transactions for the digitalization of the Japanese society.

Notes (characteristics)

March 2022

PCA Hub eDOC

Released / Service started

An online storage service for safe and secure sharing of important business data and files within a company. It is also
compatible with the Electronic Books Preservation Act and can be used to store receipts, invoices, and other vouchers.

November 2022

PCA Hub eDOC AI-OCR Option

Released / Service started

Optional service. Function which automatically registers the customer name, amount, and date on received invoices
and receipts to PCA Hub eDOC using AI-OCR.
Advantages:
・ Can automate the input work of accounting staff.
・Registered data can be linked to various software of the PCA Accounting series to create journal entries.

March 2023

PCA Hub Invoice

Released / Service started

A service for electronic delivery of invoices and transaction details that is also compatible with electronic invoices. It
can be linked to the PCA Shokon and Shokan series and PCA Accounting hyper Receivables Management Option.
Supports the shift to paperless invoicing and digitalization of the invoicing process itself.
Advantages:
・Web-based delivery of invoices reduces the cost of mailing paper invoices.
・Significant reduction in the amount of time required to enclose and send invoices by mail.
・Eliminates the need for employees to come to office for invoicing work (eliminating a barrier to remote work)
・Reduction in the workload necessary to reissue invoices

March 2023

PCA Hub Pay Slip

Released / Service started

Service specialized in web-based pay slip delivery. Calculation results of the PCA Salary series can be imported into
PCA Hub Pay Slip and sent to employees as a notification. Documents that can be delivered include pay slips, bonus
slips, refund statements, and withholding tax slips.
Advantages: Same as PCA Hub Invoice above

May 2023

eDOC Upload Tool

Released as standard feature

A function to automatically upload files saved in a local folder on a PC to PCA Hub eDOC on the cloud is provided
as a standard feature (released the eDOC Upload Tool; however, its price is included in the license price of PCA Hub
eDOC itself). In enables the autmoatic registration of data such as transaction dates, counterparty names, andamounts on PCA Hub eDOC along with invoice and receipt files. The registered data can be linked to various
software of the PCA Accounting series to create journal entries. This enables automation of a series of accounting
tasks from storing invoices and receipts to creating and registering journal entries.

This First Half (April to
Sept. 2023)

Current main productsCompatible with the new
invoicing system
Released / Service started

The hyper/DX series (packaged versions), PCA Cloud (including onAWS), PCA Subscription, and PCA Hub will all becompatible; X series and other products whose support has ended will not be compatible.

Not disclosed

Various peripheral services for PCA Hub

Release planned

Services for labor-related processes, tax declaration, etc. (details not disclosed)(Ref) Prepared by Alpha-Win Research Dept. based on the financial results materials and news release on its website. Word in red indicate
details which have been newly added in this report.

13/42This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

3． Shareholder Composition◆ Major Shareholder Composition
Major shareholders as of the end of September 2023 are shown in Figure 8.
Compared to the end of March 2023 (the same point of comparison shallapply hereinafter), shares held by the top ten major shareholders have notlargely changed except for several of the custodians (such as trust banks)
and the Employee Stock Ownership Plan.
【Figure 8】Current Major Shareholders
Units: thousand shares for the number of shares owned and % for the ratios End of Mar.
and proportions
2015

Kawashima Co., Ltd.
PCA CORPORATION (treasury shares)
JP MORGAN CHASE BANK 385632
The Master Trust Bank of Japan, Ltd. (trust account)
MSIP CLIENT SECURITIESObic Business Consultants Co., Ltd.
Custody Bank of Japan, Ltd. (trust account)
PCA Employee Stock Ownership Plan
STATE STREET BANK AND TRUST COMPANY 505001
FCP SEXTANT AUTOUR DU MONDE
Logic Systems Co., Ltd.
Nagoya PCA Co., Ltd.
APPLIED SYSTEM LABORATORY Inc.
GOLDMAN SACHS INTERNATIONALBNY GCM CLIENT ACCOUNT JPRD AC ISG (FE-AC)
JPMBL RE NOMURA INTERNATIONAL PLC 1 COLLEQUITY
JP MORGAN LUXEMBOURG S.A. 1300000
MSCO CUSTOMER SECURITIESCredit Suisse Securities
Japan Trustee Services Bank, Ltd. (trust account)
SSBTC CLIENT OMNIBUS ACCOUNT
Mizuho Bank, Ltd.
BNYM SA/NV FOR BNYM FOR BNY GCM CLIENT ACCOUNTSM LSCB RD
Shigefumi Wada (individual)
KBL EPB S.A. 107704
Reiko Sato (individual): Heir to the founder Masao Kawashima
Tomoko Kumamoto (individual): Heir to the founder Masao
Kawashima
Hiroko Wada (individual)
Proportion (%) of Treasury Shares to All Outstanding Shares

Units for shares owned: thousand shares

End of Mar.
2016

End of Mar.
2017

－
2,544
－
－
－
762
－
330
732
－
342

－
2,544
－
－
－
762
－
357
747
－
342
300

－
－
－
－
－
－
－
－
363

－
－
－
－
－
－
－
－
363

8,805
2,544
－
－
－
762
－
381
798
－
342
300
258
－
－
－
－
－
－
－
－
363

End of Mar.
2018

8,805
2,546
－
－
－
762
－
381
798
－
342
300
258
－
－
－
－
－
－
－
－
363

End of Mar.
2019

End of Mar.
2021

End of Mar.
2022

End of Mar.
2023

End of Sept.
2023

Shareholding
Ratio

8,208
3,101
1,014
284
886
762
－
337
－
－
342
300
－
－
463
359
－
－
－
－
－
－

8,208
3,101
1,399
1,137
886
762
－
349
－
377
342
300
260
－
－
－
－
－
－
－
－
－

8,208
2,001
1,399
948
886
762
－
392
－
450
342
300
260
－
－
－
－
－
－
－
－
－

8,207
1,967
1,398
1,266
885
762
466
414
385
360
342
－
－
－
－
－
－
－
－
－
－
－

40.97
8.94
6.98
6.32
4.42
3.80
2.33
2.06
1.92
1.79
1.70

909
－
－
－
－
－
－
－
363

8,205
3,136
－
－
885
762
－
300
－
－
342
300
258
－
－
－
－
－
1,416
267
261
－

8,208
3,146
－
－
－
762
－
406
521
－
342
300

End of Mar.
2020

For proportions and ratios: %

－

－

－

－

－

－

－

－

－

－

543
－
4,401

543
－
4,401

543
－
－

453
270
－

335
282
－

－
－
－

－
－
－

－
－
－

－
－
－

－
－
－

4,401

4,401

－

－

－

－

－

－

－

－

1,074
11.0

－
11.0

－
11.1

－
11.0

－
13.6

－
13.6

－
13.4

－
13.4

－
9.1

－
8.9

RankingChange(Sept. 2023 minus Mar. 2023)

1
―
2
3
4
5
6
7
8
9
10

-1
-34
-1
318
-1
-0
466
22
385
-90
0

(Ref) Prepared by Alpha-Win Research Dept. based on the securities report. (Note) The number of shares has been retroactively adjusted for the 3-for-1 stock
split conducted in October 2021.

w No change to stableshareholders in Japanw The largest shareholder isthe founder family’s asset
management company.

w PCA owns about 9% of its
own shares and isessentially the second
largest shareholder.

・The largest shareholder Kawashima Co., Ltd. (hereinafter, “Kawashima”)
is the asset management company of two directors of the Company(Fumiaki Sato, President, and Hiroshi Kumamoto, Director) and theirrelatives (descendants to the founder Masao Kawashima). Its shareholding
ratio remains mostly unchanged at approximately 41% (proportion of total
outstanding shares excluding treasury shares; the same shall apply
hereinafter).
・ The Company itself has long been essentially the second largest
shareholder (although not listed among the major shareholders). Currently,
the treasury shares currently owned by the Company is approx. 8.94% of
all outstanding shares.
・ The shares owned by the second largest shareholder, JP MORGANCHASE BANK 385632, have mostly not changed.

w Several custodians havebought more shares of theCompany.

・The Master Trust Bank of Japan (trust account) has not changed from third
place in the shareholder ranking, but has increased its shareholding to
318,000 shares as of the end of March. Also, the Custody Bank of Japan(trust account) and STATE STREET BANK AND TRUST COMPANY
505001 have also bought more shares, reappearing in the major shareholder
ranking at sixth and eighth place, respectively.
・ The numbers of shares and shareholding ratio of the fourth largest
shareholder, MSIP CLIENT SECURITIES, have mostly not changed.
14/42This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)
w Several Japanese andoverseas institutional
investors are mostly likely
investing in the Company
through custodians.
w MFS, a major US-based
investment management
firm, holds more than 5%of all shares and has
submitted a statement oflarge-volume holdings. It
seems to be continuing tohold the shares.

Issued: 12/15/2023
・As mentioned above, although there are trust banks and custodians among
the major shareholders, their final investors and investment purposes are
unknown. However, they are most likely purely investments by Japaneseand overseas institutional investors and funds.
Massachusetts Financial Services Company (“MFS”) owned 5.22% ofshares (401,900 shares) as of March 31, 2021, and had submitted astatement of large-volume holdings (the “5%-rule” statement). It later
purchased more shares and submitted a change report indicating that its
shareholding ratio was 6.23% (479,400 shares) as of May 31, 2021. Achange report has not been submitted since then.
MFS is one of the oldest investment firms in the US. It invests globally andits AUM is 547.5 billion dollars (approx. 72 trillion yen as of the end of
December 2022). Characterized by a long-term, active investment style, italso has an office in Japan and currently invests in many Japanese equities.
Although MFS is not among the list of major shareholders shown in Figure
8, it is presumably investing through the accounts of several custodians.

w The Japanese investment
trusts investing in the
Company are mainly index
funds.

Regarding investment trusts in Japan, the Company’s shares areincorporated in the “Social Issue Solution Support Fund (Smile Kakehashi),”an active thematic investment fund managed by Daiwa Asset Management,
as well as index funds managed by Sumitomo Mitsui Trust AssetManagement, Mitsubishi UFJ Kokusai Asset Management, and AssetManagement One.

w Its rival OBC is also thefifth largest shareholder.

・The fifth largest shareholder, Obic Business Consultants Co., Ltd. (OBC;
listed on TSE Prime; securities code 4733), is a competitor with whom theCompany has no transactions. There has been no change in the number ofshares held.

w A French investment fundis also a major shareholder.

・Shares held by the sixth largest shareholder, FCP SEXTANT AUTOUR
DU MONDE, has decreased by about 90 thousand shares and its
shareholding ranking fell from sixth to nineth. It is an equity investment
fund managed by the French company Amiral Gestion (an independent
asset management company founded in 2003 and focused on long-term
investments; total investment amount of 3.5 billion euro). The fund invests
in equities of OECD and emerging countries and is also a major shareholder
of several listed Japanese companies.
・The number of shares held by the Employee Stock Ownership Plan atseventh place has somewhat increased.
・Nagoya PCA Co., Ltd. (a company to which the Company outsources apart of its software development for SHOKON and other products) andLogic Systems Co., Ltd. (investment purpose unknown) seem to becontinuing to hold their shares, but they are no longer among the top ten
shareholders as of the end of September.

w There seems to be no
activist among the major
shareholders.

・Currently, there seems to be no activist-like behavior among the major
shareholders. Also, the Company has not adopted any anti-takeovermeasures.

15/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

4． ESG and SDGs
In consideration of the sustainability of the environment, society, andeconomy, the Company works on the following initiatives from theperspectives of ESG and business sustainability (SDGs).
w Promoting paperless
operations and energy
savingw Supporting digitalizationof small/medium-sizedcompanies◆ Environment
Since the Company does not own any production facility, its business is not
the kind that harms the environment. It has been working on digitalizing
internal documents and invoices to make them completely paperless. It also
works on business activity efficiency and the conservation of energy andelectricity.
◆ SocietyAs its mission statement, the Company has declared to “support customers’
businesses through enterprise system software.” The concept is to fulfill its
social responsibility by contributing to the improvement of userconvenience and efficiency. With services centered on the PCA Cloud, theCompany has realized labor reduction and automation for data entry
operations. It has been releasing various services over the years for the
productivity improvement of back-office operations and for business
continuity planning against disasters and other risks, as well as services
using AI. In this way, it aims to support the rational management and safe
business operation of small/medium-sized companies (its users) based on
their data, as well as supporting their transformation into a digital company.

w Proactively supporting
sports, people withphysical disabilities, andthe discovering anddevelopment of IT talents

The Company also supports various activities. It has been helping thediscovery and development of talented programmers who will create thefuture, promoting sports such as marathons, basketball, professional
baseball (ads and sponsorship), and hiring physically disabled people.

w Working on healthmanagement

The Company believes that its people are the most important businessresource for sustainable growth. To this end, the Company has made the"Health Management Declaration” in which one of the most importantmanagement issues is to develop an environment in which each and every
employee can continue to take on challenges while maintaining goodmental and physical health and experiencing job satisfaction and growth. In
particular, the Company is working on improving and developing healthmanagement, the workplace environment, flexible work styles, and worklife balance. It was certified as a 2023 Health and Productivity Management
Outstanding Organization (Large Enterprise Category), as an excellent
corporation working on health management, in the Health and Productivity
Management Outstanding Organization Recognition System sponsored by
the Ministry of Economy, Trade, and Industry and Nippon Kenko Kaigi.

w Certified as the 2023
Health and Productivity
Management Outstanding
Organization (Large
enterprise Category)w Of the total of 11 directors
and auditors, two are
women. Six are external
directors and external
auditors.

◆ Governance
For internal control, the Company has set up an internal audit office that
directly reports to the president, which is also managed in coordination withthe external directors. It has also set up a risk control committee with thepresident as the chairperson and has created a risk control system thatenables flexible, quick, and appropriate response to risks. It has not adopted
an executive officer system.
There are a total of 11 directors and auditors, specifically, seven directors(reduced by one; three external directors) and four auditors (three of whomare external auditors, including a tax accountant, a certified public
accountant, and a lawyer). Of these members, two are female.

16/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

5． History of Growth◆ Company History
w Founded upon recognizing
the importance andpromising future ofcomputers and enterprisesystem software in Japan

A group of five certified public accountants with the late Masao
Kawashima as the leader founded the Company in 1980 upon recognizing
the importance and promising future of computers and software businesses
in Japan. At first, they developed and sold business accounting software forsmall business computers. In 1995, expecting to eventually shift away fromusers of small business computers, the Company began focusing on thedevelopment and sales of packaged software for PCs.

w With a pioneering spirit,
became the first to begin
cloud services in theindustry

Then, with the emergence of the PC era, the Company has grown mainly
through the following four strategies: 1) creation of a greater variety of
packaged software for Japanese customers as well as their version upgrades,2) expansion of the maintenance service, 3) development of the cloudbusiness, and 4) expansion of the solutions business which includes
providing other companies’ products. Furthermore, by increasing thenumber of offices and cooperating with manufacturers and distributors, theCompany has developed a nationwide sales/support system that hascontributed to the rapid expansion of its business. It is also seen as a pioneerin the conservative industry, having been the first in the industry to begin
providing cloud services (SaaS12) in 2008.

(12) SaaS (Software as a Service):
Software in which, as a service,users can use the necessaryfunction in the necessary amountwhen needed, or the method ofproviding such a service. Insteadof the user installing thesoftware, the vendor hosts thesoftware and provides thenecessary function to the user via
a network.

Regarding its stock, the first public offering was made in 1994. The
Company became listed on the Second Section of the TSE in 2000 and thenon the First Section in 2014. In April 2022, its listing was changed to the
TSE Prime Market.

w Changed its market listingfrom the Second to theFirst Section of the TSE in
Dec. 2014. Its listing waschanged to the Prime
Market in April 2022.

◆ Past Transition in Financial Results

w Has been generallyw

As described above, the Company has been expanding its business since
foundation until now as a specialist in the development and sales ofenterprise system software and related businesses. The transition in
financial performance since its first public offering is described in Figure 9.
The following is supplemental information on the financial results inchronological order.

increasing sales over thelong term. Profit had
weakened during a period,
but then recovered in a Vshape.

【Figure 9】Long-Term Transition in Financial Results
Sales (left axis)

Recurring Profit (right axis)(Million yen)

(Million yen)

16,0002,808
14,266

14,00012,00011,4391,783

10,000

1,539
1,290

8,000

6,000 660

1,396

1,218
794

1,565

1,227

10,475
1,582
1,392

1,181

1,084
935

5,095
5,441
565
4,827
4,762
4,867
3,5414,551
4,000
3,232
5,026
3,017

9,785
9,360
1,277
8,441
8,168

7,551

1,181
6,383

6,006
5,597

6,336

6,269

798

2,340

13,3082,500
13,3822,000

12,981
1,478 1,500
1,326

6,805

834

1,139

724

3,000

2,697

6,275

14,700 1,000

463
6,167
5,867

500
501 384

67
0

2,000
-158

-500

FY
19
94
FY
19
95
FY
19
96
FY
19
97
FY
19
98
FY
19
99
FY
20
00
FY
20
01
FY
20
02
FY
20
03
FY
20
04
FY
20
05
FY
20
06
FY
20
07
FY
20
08
FY
20
09
FY
20
10
FY
20
11
FY
20
12
FY
20
13
FY
20
14
FY
20
15
FY
20
16
FY
20
17
FY
20
18
FY
20
19
FY
20
20
FY
20
21
FY
20
22
FY
2
FY 0 23
20
24
CE

0

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary. Estimate/forecast (CE) for FY2024 is from the Company’s plan.

17/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023
・Aside from certain periods such as the post-Lehman-collapse economic
downturn and the declines following high demand stimulated by revisions
in tax and other regulations, the Company has generally kept increasing
sales since 1994. On the other hand, profit growth had been slow for sometime, being unable to maintain or exceed the high level of profit that it had
once achieved.

w Record-high net profit
achieved in FY2000 owing
to the high demand
stimulated by the year 2000
problem.
w In FY2006, record-highoperating/recurring profits
were posted thanks toregulation revisions andERP.
(13) ERP (integrated enterprisesystem): Stands for Enterprise
Resource Planning.
Management concept based on
the integration and real-timeprocessing of core businessinformation to efficiently
optimize as a whole. Provided as
IT solutions software that
integrates enterprise systems.
w Results weakened after the
Lehman’s collapse. In
FY2014, record-high sales
were posted due to an
event-driven high demand,
achieving 10 billion yen insales.
w Net loss posted for two
consecutive fiscal years in
FY2015 and FY2016,
partially in reaction to theprevious event-driven highdemand.

w Positive effects of thestructural reform havestarted to be seen in
FY2016 onward.
w Growth of the cloudbusiness, release of new
products, and cost
reduction have helpedwith its performance.
Operating margin
improved.

・ Record-high net profit (937 million yen) of the time was achieved in
FY2000, thanks to the sales growth from the high demand brought by theyear 2000 problem. The consecutive decline in sales and profit from
FY2001 to FY2002 occurred in reaction to this high demand as well as dueto the economic downturn.

・In FY2006, record highs of the time were achieved for operating profit
and recurring profit (1,747 million yen and 1,783 million yen, respectively).
These record highs were due to the demand stimulated by the revision of
the accounting regulation for public benefit corporations and the drasticchange in regulations caused by the new Companies Act, as well as due tothe improvement in profitability thanks to the Company’s ERP13 (integrated
enterprise system) product, Dream 21.
・The sales decline for four consecutive years from FY2007 to FY2010, as
well as the profit decline for seven consecutive years from FY2007 to
FY2013, was caused by the decrease in demand due to the post-Lehmancollapse economic downturn and the increase in personnel, R&D, and sales
promotion expenses, as well as by worsened profitability due to intensifiedcompetition.
・In FY2014, record-high sales (10,475 million yen) were achieved thanks
to the high demand driven by two events: the end of Windows XP support(support ended in April 2014) and the change in consumption tax (from 5%
to 8% in April 2014). The large growth of the cloud service also contributed
to the record-high sales.
・Despite efforts to cut down on cost, a net loss was consecutively posted in
FY2015 and FY2016 (net loss for the year: 207 million yen in FY2015 and93 million yen in FY2016) due to the sales decline in reaction to the highdemand stimulated by the two events as described above and the postponed
revision of consumption tax to 10%.
・For many years, the Company’s gross margin and operating margin had
been gradually decreasing (Figure 10 on page 19). This was due tointensified price competition among packaged software makers during the
economic downturn, worsened product mix from a rise in the percentage ofother companies’ less-profitable goods, and higher costs, especially laborcosts, various expenses (subcontracting costs), and R&D expenses.
・However, since FY2016, the Company has been increasing sales again
and the decline in gross margin has stopped. Operating margin bottomedout and began to gradually increase thanks to increased sales of the new
products and the cloud service as well as cost reduction. The Company also
saw positive results from the structural reform that it had been working on
for several years, including the disposal of assets with impairment risk (realestate and securities) and shortened software amortization period.
・Its growth and recovery in financial performance after this were supported
by sales growth of the cloud and maintenance services and cost reduction.

18/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023
・ From FY2016 to FY2020, the Company increased sales for five fiscal
years in a row thanks to the continued growth of the cloud service, therelease of the new products, and strengthened sales force, as well as due toeconomic recovery. Since FY2017, the Company has recovered in a Vshape and has been stably posting a net profit.
・Especially in FY2020, thanks to event-driven high demand (rise in the
consumption tax rate, end of Windows 7 support, and version upgrades
related to the change in the name of the era created an early demand), sales
and profit grew significantly, hitting their record highs (sales, operating
profit, and recurring profit).

w Turned to sales/profit
growth trend starting in
FY2016. Stabling posting a
net profit. V-shaped
recovery of results.
w Significant sales/profit
growth in FY2020 due tothe high demand
stimulated by the
consumption tax revisionand the end of Windows 7
support. Posted recordhigh sales and profits.

・In reaction to this event-driven high demand, sales and profits turned to a
decline in FY2021. In FY2022, although there was a negative impact fromthe change in the revenue-recognition standard14, sales and operating profit
became the second highest in the Company’s history due to the highreplacement demand in response to the end of support for its older products(record high was only achieved for net profit, with the gain on sales of
securities). In reaction to this event-driven demand for the products, sales
and profits declined in FY2023. This fiscal year (FY2024), the Company
expects to return to sales and profit growth and achieve record-high sales.

w Large changes in financial
results before and after
event-driven demands.
w For the past seven fiscal
years, its profit results
have exceeded its initialplan. In the past, revisions
to financial forecasts haveoften been announced in
September, or January to
April of the following year.
(14) [New] revenue-recognition
standard: Accounting Standard
for Revenue Recognition (ASBJ
Statement No. 29) and otherstandards set by the AccountingStandards Board of Japan(ASBJ), which incorporate theconcepts of IFRS-15. Large
companies have been required toapply this standard starting in
April 2021.

As reference, the Company’s past initial forecasts and actual results over
the years were compared (Figure 11). Since FY2017, the profit results havetended to exceed the initial plans/forecasts made at the beginning of fiscal
years. Note that past announcements of revisions to financial forecasts haveoften been made in September, or January to April of the following year.
【Figure 10】Long-Term Transition in Gross Margin and Operating Margin
Gross Margin（％）

Operating Margin

80.0
70.0

70.1

66.4

66.8

66.1

63.2

63.0

60.0

65.8
60.3
53.5

51.0

57.0

54.5

60.3

60.1

62.0

59.8

50.0
40.0
30.0
20.0

19.5

17.8
12.7

11.1

10.0

6.9

10.6
4.7

0.5

0.0

4.6

19.8

17.4

10.9

8.2

9.9

9.8

FY2023

FY2024
CE

-2.2

-10.0
FY2009FY2010FY2011FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022【Figure 11】Comparison of the Company’s Initial Financial Forecast and Actual Results over the Years
Consolidated

Sales

Operating Profit

Recurring Profit

Net Profit Attributable to
Owners of the Parent (hereinafter "net profit")

ActualInitialActualActual result
Initial forecast
Initial forecast
Actual result
resultforecast
result
FY2001
5,026
1,224
1,227
695
FY2002
5,634
4,762
925
1,215
935
533
FY2003
5,104
5,095
1,073
1,015
1,083
589
576
FY2004
5,521
5,595
1,170
1,125
1,181
653
682
FY2005
6,096
6,005
1,551
1,293
1,565
769
915
FY2006
6,870
6,383
1,747
1,780
1,783
1,059
327
FY2007
6,860
6,336
1,533
1,550
1,582
922
852
FY2008
6,790
6,274
1,321
1,325
1,365
1,391
812
644
FY2009
6,800
6,268
1,294
1,117
1,360
1,181
809
680
FY2010
6,500
5,867
1,141
744
1,200
797
714
436
FY2011
5,908
6,166
878
686
927
724
519
411
FY2012
6,505
6,805
806
468
835
501
381
75
FY2013
7,025
7,550
56
354
84
383
29
181
FY2014
8,641
10,474
284
1,110
311
1,138
141
604
FY2015
9,198
8,168
453
-179
483
-157
283
-207
FY2016
8,880
8,440
242
40
272
66
131
-93
FY2017
9,731
9,360
165
432
187
463
51
160
FY2018
9,876
9,785
645
807
669
834
425
441
FY201910,486
11,439
825
1,248
842
1,277
588
906
FY202012,783
14,266
1,478
2,781
1,499
2,808
976
1,816
FY2021
13,28013,308
2,034
2,314
2,055
2,340
1,358
1,668
FY2022
12,447
13,382
1,866
2,655
1,899
2,697
1,192
2,367
FY2023
12,927
12,981
1,100
1,288
1,132
1,326
639
883
FY2024 CE
14,700
1,445
1,478
925
Reference: simple average of difference (units: %), calculated based on the longest period with data available for both sales & profits(excluding periods with loss and this FY) →Green highlight:
Pink highlight: 2nd
Yellow highlight: 3rd←All excluding this Number of times revised upward:downward from
Record highhighest record
highest record
FY's forecast
initial forecast (unit: # of times)→

Units: million yen

Sales

Initialforecast

Operating
ProfitRecurring
ProfitNet Profit

Difference from initial forecast-15.5%
-0.2%
1.3%
-1.5%
-7.1%
-7.6%
-7.6%
-7.8%
-9.7%
4.4%
4.6%
7.5%
21.2%
-11.2%
-5.0%
-3.8%
-0.9%
9.1%
11.6%
0.2%
7.5%
0.4%

Operating Recurring
Net Profit
ProfitProfitSales

YoY change in actual results-23.0%
6.7%
-2.2%
5.0%
4.4%
21.0%
19.0%
0.2%
-69.1%
2.1%
-7.6%
0.3%
1.9%
-20.7%-13.7%-13.2%-15.9%-34.8%-33.6%-38.9%-21.9%-21.9%-20.8%-41.9%-40.0%-80.3%
532.1%
356.0%
524.1%
290.8%
265.9%
328.4%
Revied down
Revised down Revised down
-83.5%-75.7% Revised down
161.8%
147.6%
213.7%
25.1%
24.7%
3.8%
51.3%
51.7%
54.1%
88.2%
87.3%
86.1%
13.8%
13.9%
22.8%
42.3%
42.0%
98.6%
17.1%
17.1%
38.2%
Ratio of This FY's Forecast to Last FY's Result ⇒

-0.5%

68.5%

39.8%

59.9%

10 ： 12

10 ： 6

15 ： 7

11 ： 10

-5.3%
7.0%
9.8%
7.3%
6.3%
-0.7%
-1.0%
-0.1%
-6.4%
5.1%
10.4%
10.9%
38.7%
-22.0%
3.3%
10.9%
4.5%
16.9%
24.7%
-6.7%
0.6%
-3.0%
13.2%
5.1%

-24.4%-23.8%-23.3%
16.0%
15.8%
8.1%
9.0%
9.0%
18.4%
32.6%
32.5%
34.2%
12.6%
13.9%
-64.3%-12.2%-11.3% 160.6%-13.6%-12.1%-24.4%-15.7%-15.1%
5.6%-33.4%-32.5%-35.9%
-7.8%
-9.2%
-5.7%
-31.8%-30.8%-81.8%-24.4%-23.6% 141.3%
213.6% 197.1% 233.7%
To loss
To loss
To loss
To profit To profit To profit
980.0% 601.5% -272.0%
86.8%
80.1% 175.6%
54.6%
53.1% 105.4%
122.8% 119.9% 100.4%-16.8%-16.7%
-8.1%
14.7%
15.3%
41.9%
-51.5%-50.8%-62.7%
12.2%
11.4%
4.8%
65.6%

45.6%

22.3%

↑ Simple average of all periods (excluding
this FY)(Ref) Figures 10 and 11: Prepared by Alpha-Win Research Dept. based on the financial results summary. The FY2024 forecasts/estimates (CE) are from theCompany’s plan. (Note) The new revenue-recognition standard has been applied starting in FY2022 (CE).

19/42This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

6． Business Environment◆Trends of the Software Market
w Decreasing number ofsmall/medium-sizedcompanies (its current andpotential users) in Japan,
but the size of theenterprise system software
market is expected tosteadily grow over the
medium to long term.

w Software investment(planned amount) by small
and mid-tier companies is
expected to increasesignificantly in FY2023.
Business sentiment is
improving, but the outlook
is uncertain.

Number of Small/Medium-Sized Companies (potential users) in JapanThe number of small/medium-sized companies, or the Company’s main
potential customers, has been declining since they have been closing theirbusinesses due to the decreasing and aging population of Japan.
On the other hand, companies and organizations have been working on
rebuilding or strengthening their enterprise systems, as they have been
faced by an increasingly serious labor shortage and have been working on
improving operational efficiency and business performance. Although thenumber of small/medium-sized companies will likely continue to decrease,
we predict that the size of the enterprise system software market will
steadily increase over the medium to long term as the demand for software
to improve business operation efficiency and digitalize increases.

Current Situation: BOJ Tankan
According to the Bank of Japan Tankan in December 2023, the amount ofsoftware investment planned in 2023 by small/medium-sized companies(all industries) is +21.7% greater than last year (of which, +30.0% formanufacturing and +18.5% for non-manufacturing). Manufacturingindustries are especially expected to increase their investment. Note thatplanned investment in FY2022 was somewhat low at -2.6% compared tothe previous year (of which, manufacturing was +4.8% and nonmanufacturing was -5.2%).
Mid-tier companies are showing an even more eager attitude toward
software investment compared to small/medium-sized companies, with aplanned increase in investment of +19.8% in FY2022 (+6.0% and +8.8%,
respectively) and +27.3% in FY2023 (+13.3% and +16.4%, respectively).
Regarding the survey on business sentiment among small/medium-sizedcompanies (all industries), the recent sentiment has improved from +5 in
September 2023 to +9 in December 2023. On the other hand, the outlook
stayed the same at +4, which is 5 less than the recent sentiment. This
indicates the worsened sentiment regarding the economic outlook (similar
for large and mid-tier companies).

◆Comparison with Competitors
w In the industry, companies

are moving toward acertain degree of
coexistence by taking
strong positions
depending on the user sizeor software function.

w OBC is its greatest rival. It
also indirectly competes
with MJS.

Positions and Main Players of the Industry
Figure 12 on page 21 is an overview of the various positions and main
players of the industry, categorized by customer type. The players in theindustry have adjusted toward a certain degree of coexistence by taking
strong positions in different niches, segregated by the size of thecompanies/organizations that are their users or the type of operation
targeted by their software.
The Company has different rivals for each type of operation targeted by its
software. Regarding its rivals among listed companies for its key
accounting software, its direct rival is thought to be Obic Business
Consultants (OBC; listed on the TSE Prime Market; securities code 4733)
and its indirect rival is most likely Miroku Jyoho Service (MJS; TSE Prime;9928). OBC is the greatest rival since it has a similar product lineup andbusiness model as the Company.
20/42

This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023【Figure 12】Target Customers and Main Players of the Enterprise
System Software Market(Ref) Excerpt from past financial results briefing materials, partially edited by Alpha-Win
Research Dept.

w Among private companies,
it competes withcompanies including
Yayoi, OHKEN, and OSK.

w The Company provides
high-quality products andservices at reasonable
prices.
w Its flagship product, or theaccounting software, has
the third largest share in
the market.
w In addition to OBC, also
competing with Money
Forward and freee for a partof the cloud-based
accounting software
business.

In addition, the following private companies are the main direct competitors,
both for the on-premises and the cloud-based software.
・Yayoi Co., Ltd. (main office in Chiyoda-ku, Tokyo): acquired from Orix
Corporation (TSE Prime: 8591) by Kohlberg Kravis Roberts & Co. L.P.
(“KKR”); sales in the fiscal year ended September 2022 were 22.1 billion
yen (slight sales growth); 978 employees (as of the end of September 2023);
over 3.1 million registered users.
・OHKEN Co., Ltd. (main offices in Shibuya-ku, Tokyo, and Fukuoka City,
Fukuoka): the DAIJIN series are the main products; independent company;
sales in the fiscal year ended December 2022 were 5.24 billion yen; 340
employees (as of the end of April 2023).
・ OSK Co., Ltd. (main office in Sumida-ku, Tokyo): the SMILE series are
the main products; wholly-owned subsidiary of Otsuka Corporation; sales
in the fiscal year ended December 2022 were 9.5 billion yen and net profit
was 1.24 billion yen; 459 employees (as of the end of October 2023).
The Company is characterized by its high-quality but reasonably priced
products and services.
The accounting software market size is estimated to be approx. 200 billion
yen. The market is reaching maturity and its size has stayed mostly flat over
the recent years. In this market, the Company is estimated to be third fromthe top (a share of about 10%). It also seems to have a similar level ofmarket share and position with its payroll and HR software.
In addition to the above, in the cloud accounting market, its maincompetitors among listed companies are Money Forward (TSE Prime 3994;
providing cloud services such as household accounting application for
individuals and accounting software for companies) and freee (TSE Growth4478; providing ERP services or cloud accounting software for small
businesses). These companies mainly target one-person businesses andsmall companies such as small/medium-sized companies and SOHOs, sothey compete with the Company only in specific areas.

21/42This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

Comparison of Profitability of the Three Competing, Listed
Companies
A comparison of the long-term transition in gross margin and operating
margin of the three competing, listed companies (the Company, OBC, and
MJS) is shown in Figures 13 and 14. Compared to the Company, bothmargins are stable for OBC and MJS. This is presumably due to thedifference in the business model, the sales composition, and scaleadvantage (the sales of OBC and MJS are about 2.6x and 3.2x greater thanthe Company, respectively, and similarly their operating profit is about
11.4x and 4.7x greater, respectively, according to last fiscal year’s results).

w Profit margins have
improved compared tobefore, but have thepotential to be improved
further.

Both competitors used to have a lower subscription rate for maintenancesupport but have succeeded in raising this rate strategically, resulting in agreater earning power. However, through its focus on the subscription
business, the Company’s profit margins have also been improving andbecoming stable in recent years excluding the periods of decline in reaction
to an event-driven high demand.
The transition in the Company’s ROA and ROE, shown in Figure 15, showsthat they had been significantly improving in recent years due to profit
growth. In FY2023, though, the significant decline in profit caused theCompany’s ROA and ROE to be 4.5% and 5.1%, falling below OBC’s
9.0% and 8.0% and MJS’s 13.1% and 16.2%, respectively.
【Figure 13】Long-Term Transition in the Gross
Margin of the Three Major Listed Companies(PCA, OBC, and MJS)
PCA

（％）

OBC

【Figure 14】Long-Term Transition in the Operating
Margin of the Three Major Listed Companies(PCA, OBC, and MJS)

MJS

83.4

85.0
80.0

84.2

84.0

84.4

83.7

84.7

84.3

84.8

50.0
84.4

84.0

82.5

83.8

83.9

82.6

30.0
66.4

65.0

55.0

43.4

45.0

43.2

OBC

MJS
44.4

42.7

41.7

41.4

44.2

43.2

47.1

43.6

42.2

14.7

14.7

9.9

9.8

FY2023

FY2024
CE

40.0

70.1

59.5

45.6

40.9

79.0

60.0

46.7

82.2

75.0
70.0

PCA

（％）

90.0

61.8

66.8

66.1

65.9

65.0

64.4
63.2

63.0

64.0

65.2

66.3

66.3

63.6

62.1

61.8

63.1

57.0
60.3

54.5

53.5

57.8

60.1

61.8

62.0

19.5

20.0

60.3
62.3

28.0

65.8

17.8

59.8

10.0

51.0

4.3

12.7

11.1

10.3

10.8

11.3

8.0

6.9

0.0

14.7

13.3

10.9

4.6

10.6

17.4

16.5

8.2

6.2

50.0
45.0

10.9

16.3

15.6

12.9

19.8

13.1

0.5

4.7
-2.2

40.0

-10.0

FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024
CE(Ref) Figures 13-15: Prepared by Alpha-Win Research
Dept. based on the securities reports. Estimates/forecasts(E) are from the companies’ plans.

FY2009FY2010FY2011FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022【Figure 15】Transition in the Company’s ROA and ROE
（％）

ROA

16.0

ROE

14.4

14.0

14.3

12.0
10.0

6.0
4.0
2.0
0.0
-2.0

7.8

7.2
5.8

5.2

6.3

4.8
3.5

4.0

4.0
0.7

2.6
1.7

2.9

5.2

3.9

0.4
-1.0
-1.8

9.7
6.8

5.1
4.5

1.5
-0.9

FY
20
09
FY
20
10
FY
20
11
FY
20
12
FY
20
13
FY
20
14
FY
20
15
FY
20
16
FY
20
17
FY
20
18
FY
20
19
FY
20
20
FY
20
21
FY
20
22
FY
20
23

-4.0

10.0

13.0

8.8

8.0

11.4

＊For ROA, the ratio of recurring profit to total assets was used.

22/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

7 ． The First Half’s Results and This Fiscal

Year’s Forecast◆Results for the First Half of FY2024 (April to September
2023)
w This first half's results
were strong, with doubledigit increases in sales andprofit.

Summary
Consolidated results for the first half of FY2024 were as follows: sales of
7,074 million yen (+14.8% YoY), operating profit of 998 million yen(+17.8% YoY), recurring profit of 1,026 million yen (+17.8% YoY), andnet profit attributable to owners of the parent of 660 million yen (+33.5%
YoY; hereinafter, “net profit”). A double-digit sales growth and asignificant profit growth were achieved (Figure 16).

【Figure 16】Financial Results for the First Half of FY2024 (April to September 2024)(Units: million yen or %)First-Half Results
Results

First Half of FY2023

First Half of FY2024% ChangeAmount of Change% of Total

Units: million yen

Apr. to Sept. 2022

Apr. to Sept. 2023

YoY: %

YoY: million yen%

Consolidated Sales

Sales by Category

Products
Merchandise
Maintenance Service
Cloud Service
Other Operating Revenue

Gross Profit
Gross Margin (%)
SG&A Expenses
SG&A Expense Ratio (%)
Operating Profit
Operating Margin (%)
Recurring Profit
Recurring Margin (%)
Net Profit
Net Profit Margin (%)

w Strong progress made withthe profits in terms ofachieving the full-year
plan.

w Sales grew due to the new
invoicing system and theprice revision.

w Sales of merchandise
decreased but the impact
was minimal.

6,163

7,074

14.8

911

100.0

557

713

28.1

156

10.1

222

198

-10.7

-24

2.8

1,688

1,715

1.6

27

24.2

2,860

3,443

20.4

583

48.7

834
3,912
63.5
3,065
49.7
847
13.7
871
14.1
494
8.0

1,002
4,429
62.6
3,430
48.5
998
14.1
1,026
14.5
660
9.3

20.2
13.2

168
517
-0.9
365
-1.2
151
0.4
155
0.4
166
1.3

14.2

11.9
17.8
17.8
33.5

(Ref) Prepared by AlphaWin Research Dept.
based on the financial
results summary. The
Company’s plan andAlpha-Win’s
forecasts are the mostrecent forecasts.

Comparison with the Forecast
The Company does not announce its first-half forecasts. However, progressin this first half in terms of achieving its full-year plan was 48.1% for sales,
69.1% for operating profit, and 71.4% for net profit. Progress has been
greater than past years (average progress for each of the profits over thatpast six years was 49.3% and 51.6%, respectively), so the results have most
likely been significantly greater than the Company’s internal forecasts.
Sales
Each sales category’s impact on sales in the first half of this fiscal year is
as shown in Figure 17 on page 24. In FY2022 (the fiscal year before theprevious), there was a replacement demand (event-driven high demand) due
to the end of support for the X series (in December 2021). In FY2023(previous fiscal year), though, sales and profits declined significantly inreaction to this previous high demand. However, the first half of the current
fiscal year was no longer impacted by this reactionary decline and its sales
were strong, driven overall by the demand related to the new invoicing
system. In addition, the price revision in July 2023 also had a significant
impact (prices were raised by about 20%; estimated to have contributed
about 500 million yen to sales growth in about three months).
By sales category, merchandise was the only category among the five sales
categories whose sales declined. This was due to the drop in demand forledger sheets due to digitalization, but the amount of sales decline was small
since this category itself is small in scale. Maintenance also saw a slightincrease in sales due to the recovery of the products’ sales and the demand
related to the new invoicing system, despite the shift to the cloud.
23/42

This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

w Cloud service's sales havecontinued to grow with thesteady increase in thenumber of corporate usersof the cloud service.
Largest growth driver.

On the other hand, the number of corporate users of the cloud service has
steadily increased. Of the company-wide (net) sales growth of +911 million
yen in the first half, sales of the cloud service accounted for +583 million
yen or 64%. Its sales growth rate (YoY) recovered to +20% and thiscategory was the largest growth driver.

w Solutions also performed
well. The products
recovered and their sales
increased.

This was followed by the “solutions and other” category, whose sales grewby +168 million yen, and the products, whose sales grew by +156 million
yen. They accounted for 18% and 17% of the total amount of sales growth,
respectively. Both of these were driven by greater sales related to the new
invoicing system and were also helped by the demand for peripheralservices and version upgrades.

【Figure 17】Each Sales Category’s Impact on Sales in the First Half of FY2024 (April to September 2024)(Million yen)

10,000

Increase

Decrease

9,000
8,000

＋20.4%＋28.0%

7,000

＋1.6％

156

6,163
6,000

583

＋20.1％
168

7,074

27
-24

-10.8％

5,000
4,000
3,000

FY2023First Half

Products

Merchandise

Main tenance

Cloud

Solutions and OtherFY2024First Half

(Ref) Prepared by Alpha-Win Research Dept. from the financial results materials

w The number of corporate

users of the cloud service
surpassed 22,000 as of theend of the first half.

Cloud
The number of corporate users of the PCA Cloud reached 10,000 on
January 11, 2018. The number has then been increasing from 12,070 at theend of March 2019 to 14,327 at the end of March 2020 (+2,257 YoY),
16,444 at of the end of March 2021 (+2,117 YoY), 19,152 at the end of
March 2022 (+2,708 YoY; the largest net increase ever), 21,022 at the endof March 2023 (+1,870 YoY), and 22,238 at the end of September
2023(+2,385 YoY) (Figure 6 on page 12 and Figure 18 on page 25).

w A high net growth rate has

In FY2023, the net increase in the annual number of corporate users fell
below 2,000 users, but this seems to have been a reactionary decline due toa part of the event-driven high demand for the products in FY2022 beingreflected in the cloud service as well. The rate of net increase has been
maintained at a high level in the current fiscal year, too, gaining +2,153
corporate users in Q1 (YoY) and +2,385 corporate users in Q2 (YoY)(Figure 19 on page 25). The Company hopes to maintain the net growth in
the number of corporate users at about 1,800 to 2,000 companies per year
for the meanwhile.

w Sales growth rate of the

The cloud’s sales have been increasing from 2,452 million yen in FY2019(+598 million yen or +32.3% YoY) to 3,374 million yen in FY2020 (+922
million yen or +37.6% YoY), 4,057 million yen in FY2021 (+683 million
yen or + 20.2%), 5,568 million yen in FY2022 (the fiscal year before theprevious; +1,511 million yen or + 37.2%), and 5,956 million yen in FY2023(previous fiscal year; +388 million yen or + 7.0%).

been maintained.

cloud service has slowed
compared to before.

24/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023
As already mentioned, the cloud service’s sales increased by 583 million
yen (+20.4%) from 2,860 million yen in the first half of the previous fiscal
year to 3,443 million yen in the first half of the current fiscal year, and its
rate of sales growth is recovering (+18.7% in Q1 and +21.9% in Q2).

w Cloud service’s sales
growth rate has recovered
to about 20% in the firsthalf of this fiscal year.
w Average unit price per
corporate user is on an
upward trend.

Since the cloud’s sales include PCA Hub and PCA Subscription, a simple
comparison cannot be made, but the annual sales per corporate user (=annual sales / average number of corporate users of the PCA Cloud during
the fiscal year; units of thousand yen per company per year) have been
increasing during this period (Figure 18).
On a quarterly basis, the average unit price rose by about 9% YoY in Q2 ofthe current fiscal year, presumably due to the price revision (Figure 19).

【Figure 18】Change in the (Non-Consolidated) Number of Corporate Users of the Cloud Service and the(Consolidated) Sales of the Cloud Service (yearly and semi-annual change)
Fiscal Year

FY2019FY2020
FY2021
FY2022
FY2023
FY2024 CE

Number of Corporate Users of
the Cloud Service

Cloud Service's Sales

Units: companies

Units: million yen

Number of Corporate Users(companies)% Change(YoY)

Average Annual Unit Average Monthly
Price
Unit Price

Sales (million yen)

Change in
Number (YoY)% Change(YoY)

Amount of
Change (YoY)

Thousand yen/
company/year

Thousand yen/
company/month

12,07014,327
16,444
19,152
21,022

2,452
3,374
4,057
5,568
5,956
7,282

−
18.7
14.8
16.5
9.8
ー

−
2,257
2,117
2,708
1,870
ー

32.3
37.6
20.2
37.2
7.0
22.3

598
922
683
1,511
388
1,326

−
256
264
313
297
ー

−
21
22
26
25
ー

First Half of FY2023

19,853

2,860

11.6

2,068

10.2

265

293

24

First Half of FY2024

22,238

3,443

12.0

2,385

20.4

583

318

27

Not disclosed(Ref) Prepared by Alpha-Win Research Dept. from the financial results summary(Note) Average unit price was calculated by dividing the sales for the period by the average number of users during the period. The annual unit price forthe first and the second half is the unit price which has been calculated into the full year (simply multiplied by two for the first half).

【Figure 19】Change in the (Non-Consolidated) Number of Corporate Users of the Cloud
Service and the (Consolidated) Sales of the Cloud Service (quarterly change)
QuarterNumber of Corporate Users of the
Cloud Service: A

Cloud Service's Sales: B

Cumulative Number of Users at theEnd of the Month (units: companies)

For Each Quarter(units: million yen)

Quarterly Change in the Number of Corporate Users (companies)% Change(YoY)

Change in Number
(YoY)

14.8

2,117

% Change(QoQ)

Ended Mar 2021 (Q4)

16,444

1,076―

Ended June 2021 (Q1)

Not disclosed

1,255

―

―

Ended Sept. 2021 (Q2)

17,785

1,340

16.5

2,523

―

Ended Dec. 2021 (Q3)18,578

1,449

―

―

4.5

Ended Mar. 2022 (Q4)

19,152

1,524

16.5

2,708

3.1

Ended June 2022 (Q1)

19,441

1,361

―

―

1.5

Ended Sept. 2022 (Q2)19,853

1,499

11.6

2,068

Quarterly Change in Sales (million yen)

Change in Number(QoQ)% Change(YoY)

Change in Amount(YoY)% Change(QoQ)

Change in Amount(QoQ)

Monthly Unit Price of the Cloud Service(thousand yen / company / month)YoY Diff.
for the Left

B (quarterly sales ) / Average of A During the Period /3 months

％

―

14.0

132

4.3

44

―

31.1

298

16.6

179

―

35.1

348

6.8

85

793

40.4

417

8.1

109

26.6

574

41.6

448

5.2

75

26.9

289

8.4

106

-10.7

-163

23.5

2.1

412

11.9

159

10.1

138

25.4

―

Ended Dec. 2022 (Q3)

20,406

1,512

9.8

1,828

2.8

553

4.3

63

0.9

13

25.0

-5.8%

Ended Mar. 2023 (Q4)

21,022

1,584

9.8

1,870

3.0

616

3.9

60

4.8

72

25.5

-5.3%

Ended June 2023 (Q1)

21,594

1,616

11.1

2,153

2.7

572

18.7

255

2.0

32

25.3

7.5%

Ended Sept. 2023 (Q2)

22,238

1,827

12.0

2,385

3.0

644

21.9

328

13.1

211

27.8

9.3%

(Ref) Prepared by Alpha-Win Research Dept. from the financial results summary(Note) The cloud service’s monthly unit price is the average unit price per month for each three-month period.

w The sales proportion of thesubscription businesses
has increased to about 70%.

w The balance of contract
liabilities has beenbuilding up steadily.

Subscription-Based Business
The proportion of subscription-based revenue (total sales of themaintenance service + cloud service) to total sales, a key indicator for theCompany, rose from 66.4% in the fiscal year before the previous to 71.5%
in the previous fiscal year (the same order shall apply hereinafter). The
further shift to the cloud has helped increase this proportion to 72.9% in thefirst half of this fiscal year.
Also, the balance of contract liabilities (advances received for the cloud andmaintenance services; future sales) has increased steadily from 7,364
million yen at the end of FY2022 to 8,293 million yen at the end of FY2023,
and then to 9,112 million yen at of the end of this fiscal year’s first half(+819 million yen or +9.9% compared to the end of the previous fiscal year)(Figure 20 on page 26).

25/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023【Figure 20】Change in the Balance of Contract Liabilities (units: million yen or %)(million yen)

10,000

Balance (left axis)

50.0%% Change (right axis)

45.0%

8,000

40.0%

7,000

35.0%

6,000

30.0%

5,000

25.0%

4,000

20.0%

3,000

15.0%

2,000

10.0%

1,000

5.0%

0

0.0%

Ju
n

M
ar

20
20
20
20
Se
p
20
2
De 0
c2
02
M
0
ar
20
21
Ju
n
20
21
Se
p
20
De 21
c2
02
M
1
ar
20
22
Ju
n
20
22
Se
p
20
De 22
c2
02
M
2
ar
20
23
Ju
n
20
23
Se
p
20
23

9,000

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary.
(Note) Figures for FY2021 and before are the sum of unearned revenue and long-term unearned revenue. “% Change” is YoY.

ProfitFigure 21 shows the factors contributing to an increase or decrease inconsolidated operating profit in the first half of this fiscal year.
【Figure 21】Factors that Increased/Decreased Operating Profit in the First
Half of FY2024 (April to September 2023)(Millionyen)

Operating
ProfitSales

Cost of Sales

Operating
ProfitSG&A Expenses

3,000

Increase

Decrease

2,500

2,000

911
-52

1,500

-24
-319

1,000

-85

848

-70
-210

999

500

0
A
FY2023First HalfA
Decreasein SalesA
Increasein
Cost of CloudA
Decrease in Cost of
Purchase, etc.

A
Increase in
Other
Manufacturing
Costs

A
Increase inSales Promotion
and Advertising
ExpensesA
Increasein
R&D Expenses

A
Increasein
Other SG&A
ExpenseA
FY2024First Half

(Ref) Prepared by Alpha-Win Research Dept. from the financial results materials.

w The sales growth absorbed
the increase in costs,
including subcontracting
costs and personnel
expenses.

On a company-wide basis, profit increased by 151 million yen in the firsthalf of the current fiscal year compared to the first half of the previous fiscal
year. The only factor contributing to profit growth was the increase in sales(+911 million yen compared to the previous fiscal year’s first half), which
offset all the negative impact of various increased costs on profit. The costof sales caused profit to decline by 395 million yen, mainly due to theincrease in other manufacturing costs by 319 million yen (including an
increase of about 250 million yen in subcontracting costs associated with
development).
In addition, SG&A expenses increased by 365 million yen and negatively
impacted profit. The majority of the amount of increase was due to other
SG&A expenses, which increased by 210 million yen mainly due to higher
personnel expenses associated with increasing the number of employees
and greater system usage fees. Sales promotion and advertising expenses
also increased due to events held in this first half (e.g., PCA Fest).
26/42

This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023
Profit Margins and SG&A Expense Ratio
The gross margin deteriorated by 0.9 percentage point from the previous
first half to 62.6% in this first half due to the previously mentioned increasein development and subcontracting costs. SG&A expenses increased, but
their rate of increase was 11.9%, which was smaller than the sales growthrate of 14.8%. Consequently, the SG&A expense ratio declined by 1.2
percentage point from 49.7% to 48.5%. As a result, the operating margin
improved by 0.4 percentage point, from 13.7% to 14.1%.

w Gross margin declined,
while the SG&A expense
ratio improved, and theoperating margin rose by
0.4%.

Analyzing the factors that increased/decreased profit in terms of profit
margins, we estimate that the increase in profit due to the improvement in
the operating margin was 28 million yen (= rise in operating margin x sales
for the first half of the current fiscal year = 0.4% x 7,074 million yen), while
the increase in profit due to the increase in sales was 123 million yen(overall amount of increase in profit - increase in profit due to theimprovement in operating margin = 151 million yen - 28 million yen ≈overall amount of increase in sales x operating margin in the previous firsthalf = 911 million yen x 13.7%) and was therefore greater.
Since the Company's business model is characterized by a high marginal
profit ratio, the increase in sales should have led to a significant
improvement in the operating margin, such that the operating margin andrecurring margin growth rates significantly exceed the rate of increase insales. However, in the first half of this fiscal year, both growth rates onlyrose to a limited extent due to the rise in upfront investment costs.

w Due to upfront investment
costs, the operating andrecurring margins only
slightly exceeded the sales
growth rate.

Quarterly Financial Results
Looking at the quarterly results, the Company had posted an operating loss
in Q4 of the previous fiscal year due to its emphasis on upfront investments,
but profits were posted in both Q1 and Q2 of the current fiscal year (Figure22). In Q1, sales were 3,387 million yen (+14.7% YoY) and operating profit
was 428 million yen (+38.5% YoY), and in the following Q2, sales were
3,687 (+14.9% YoY) and operating profit was 570 million yen (+5.9%
YoY). The Company maintained a sales growth and turned profitable again.
The operating margin rose significantly from -1.5% in the previous fiscal
year’s Q4 to 12.6% and 15.5%, respectively, recovering to almost the samelevel as the same period of last fiscal year (10.5% and 16.8%).

w Operating loss wasrecorded in Q4 of theprevious fiscal year, but in
Q1 and Q2 of the current
fiscal year, both sales andprofit increased and an
operating profit wasposted.

【Figure 22】Quarterly Change in Financial Performance
FY2022
Results

Q1

Units: million yen

Consolidated Sales

Sales by Category

Q2(Apr-Jun) (Jul-Sep)

First Half

Q3

Apr-Sep 2021

(Oct-Dec)

FY2023

Q4

Second Half

Full Year(Jan-Mar 2022) Oct 2021 - Mar 2022

FY2024Q1Q2First Half

Q3

Q4

Second Half

(Apr-Jun)(Jul-Sep)

Apr-Sep 2022

(Oct-Dec)(Jan-Mar 2023)

Oct 2022 - Mar 2023

Full Year

Q1

Q2

First Half

Second-Half
Forecast(Apr-Jun)(Jul-Sep)

Apr-Sep 2023

Oct 2023 - Mar 2024

Full-Year
Forecast

3,328

3,281

6,609

3,535

3,238

6,773

13,382

2,954

3,209

6,163

3,370

3,448

6,818

12,981

3,387

3,687

7,074

7,626

14,700

Products

935

783

1,718

745

491

1,236

2,954

241

316

557

308

284

592

1,149

349

364

713

690

1,403

Merchandise
Maintenance Service
Cloud Service
Other Operating Revenue

85

82

167

190

82

272

439

108

114

222

210

145

355

577

95

103

198

349

547

820

826

1,646

833

837

1,670

3,316

838

850

1,688

800

839

1,639

3,327

839

876

1,715

1,644

3,359

1,255

1,340

2,595

1,449

1,524

2,973

5,568

1,361

1,499

2,860

1,512

1,584

3,096

5,956

1,616

1,827

3,443

3,839

7,282

231

250

481

318

304

622

1,103

404

430

834

541

594

1,135

1,969

486

516

1,002

1,107

2,109

2,284

2,222

4,506

2,284

2,019

4,303

8,809

1,829

2,083

3,912

2,064

2,075

4,139

8,051

2,116

2,313

4,429

4,368

8,797

68.6

67.7

68.2

64.6

62.4

63.5

65.8

61.9

64.9

63.5

61.2

60.2

60.7

62.0

62.5

62.7

62.6

57.3

59.8

1,309

1,444

2,753

1,474

1,926

3,400

6,153

1,520

1,545

3,065

1,570

2,128

3,698

6,763

1,688

1,742

3,430

3,921

7,351

SG&A Expense Ratio (%)

39.3

44.0

41.7

41.7

59.5

50.2

46.0

51.5

48.1

49.7

46.6

61.7

54.2

52.1

49.8

47.2

48.5

51.4

50.0

975

778

1,753

810

92

902

2,655

309

538

847

493

-52

441

1,288

428

570

998

447

1,445

Operating Margin (%)

29.3

23.7

26.5

22.9

2.8

13.3

19.8

10.5

16.8

13.7

14.6

-1.5

6.5

9.9

12.6

15.5

14.1

5.9

9.8

987

795

1,782

817

98

915

2,697

315

556

871

501

-46

455

1,326

436

590

1,026

452

1,478

Recurring Margin (%)

29.7

24.2

27.0

23.1

3.0

13.5

20.2

10.7

17.3

14.1

14.9

-1.3

6.7

10.2

1.3

1.6

1.5

0.6

1.0

614

835

1,449

819

99

918

2,367

142

352

494

330

59

389

883

266

394

660

265

925

Net Profit Margin (%)

18.4

25.4

21.9

23.2

3.1

13.6

17.7

4.8

11.0

8.0

9.8

1.7

5.7

6.8

7.9

10.7

9.3

3.5

6.3

Gross Profit
Gross Margin (%)
SG&A Expenses
Operating Profit
Recurring Profit
Net Profit(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary.

w In recent years, theCompany have been
strategically making moreinvestments in Q4, whichhave reduced profit as aresult.

Note that in Q4 FY2022 and Q4 FY2023, the SG&A expense ratio largely
rose compared to Q1 through Q3 of each fiscal year, while the operating
margin declined (simple average of the operating margin from Q1 to Q3 foreach fiscal year was 25.3% and 14.0%, respectively, whereas it was +2.8%
and -1.5% in Q4). The main reason is that the Company had strategicallyincreased upfront investments, such as development costs and personnel
expenses, in the last quarter of each fiscal year to prepare for future growth.

27/42This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023◆ PCA’s Financial Forecast for FY2024 (this fiscal year)
Summary of the Full-Year Forecast
There has been no change to the full-year plan that the Company has
announced at the beginning of the fiscal year. In FY2024 (the current fiscal
year), the Company expects double-digit growths in sales and operating
profit, with sales of 14,700 million yen (+13.2% YoY), operating profit of
1,445 million yen (+12.2% YoY), recurring profit of 1,478 million yen(+11.4% YoY), and net profit of 925 million yen (+4.8% YoY) (center left
column of Figure 23).

w The Company has

maintained the forecasts
for this fiscal year thathave been made at the
beginning of the fiscal
year. Expecting doubledigit growths in sales andoperating profit, as well as
record-high sales.

Sales for the current fiscal year are expected to hit a record high for firsttime in four fiscal years, exceeding the 14,266 million yen recorded in
FY2020 when there was an event-driven, high demand.

w The Company may conduct

To achieve the final profit goal, the Company may either increase or
suppress expenditure depending on changes in the internal and external
conditions.

cost control to some extent
achieve the forecasted
profits for the full year.

【Figure 23】Financial Forecast for This Fiscal Year (the Company’s plan and Alpha-Win’s forecasts)
Consolidated(units: million yen)
Sales

FY2024: Company Forecast

FY2023
New RevenueRecognition Standard

New RevenueYoY: Diff. in amount
Recognition Standard/ Diff.

12,981
1,149
577
3,327
5,956
1,969
8,051
62.0%
6,763

14,700
1,403
547
3,359
7,282
2,107
8,797
59.8%
7,351

1,719
254
-30
32
1,326
138
746
-2.2%
588

52.1%
1,288
9.9%
1,326
10.2%

50.0%
1,445
9.8%
1,478
10.1%

-2.1%
157
-0.1%
152
-0.2%

Net Profit Attributable to Owners of the
Parent

883

925

42

N.P. Margin
Annual Dividend Per Share (yen)

6.8%
17.0

6.3%
17.0

-0.5%
0.0

Products

Sales byCategory

Merchandise
Maintenance Service
Cloud Service
Other Operating Revenue

Gross Profit
Gross Margin

SG&A Expenses
SG&A Expense Ratio

Operating Profit
O.P. Margin

Recurring Profit
R.P. Margin

Difference bet. Alpha-Win's New
Forecast and Company Forecast

FY2024: Alpha-Win's New Forecast (current)
New Revenue-Recognition YoY: Diff. in amountStandard/ Diff.

YoY: % change

13.2%
22.1%
-5.2%
1.0%
22.3%
7.0%
9.3%
8.7%
12.2%
11.4%
4.8%

14,900
1,500
520
3,360
7,300
2,220
9,300
62.4%
7,300

1,919
351
-57
33
1,344
251
1,249
0.4%
537

49.0%
2,000
13.4%
2,030
13.6%

-3.1%
712
3.5%
704
3.4%

1,220

337

8.2%
19.0

1.4%

YoY: % change

14.8%
30.5%
-9.9%
1.0%
22.6%
12.7%
15.5%
7.9%
55.3%
53.1%
38.2%

FY2024: Alpha-Win's Old Forecast (previous)
New Revenue-Recognition YoY: Diff. in amountStandard/ Diff.

New Forecast - Company Forecast

200
97
-27
1
18
113
503
2.6%
-51

14,800
1,600
520
3,330
7,100
2,250
9,050
61.1%
7,480

1,819
451
-57
3
1,144
281
999
-0.9%
717

-1.0%
555
3.6%
552
3.6%

50.5%
1,570
10.6%
1,600
10.8%

-1.6%
282
0.7%
274
0.6%

295

1,000

117

1.9%
2.0

6.8%
18.0

0.0%

YoY: % change

Difference bet. Alpha-Win's
New and Old Forecasts
New Forecast - Old Forecast

14.0%
39.3%
-9.9%
0.1%
19.2%
14.3%
12.4%

100
-100
0
30
200
-30
250
1.3%
-180

10.6%

-1.5%
430
2.8%
430
2.8%

21.9%
20.7%
13.3%

220
1.4%
1.0

(Ref) Prepared by Alpha-Win Research Dept.

w Prices have been revised.

w Cloud and solutions are
expected to continue togrow. The products' sales
are expected to recoversince there will no longer
be a reactionary drop fromthe previous event-driven
high demand.

Summary of the Full-Year Forecast (Sales)
For the current fiscal year, the Company expects overall sales to grow by
1,719 million yen YoY (+13.2%) due to an increase in the cloud service’s
sales, the overall price revision of the main products and services (revisedin July; rate of price increase was approx. 20%), and sales of the Hub series.
The sales forecast for each sales category is also unchanged from the initialplan. Sales of the cloud service are expected to increase by 1,326 million
yen (+22.3% YoY) to account for 77% of the total forecasted amount of
increase in sales.
This is expected to be followed by the sales of the products and solutions,which are forecasted to increase by 254 million yen (+22.1% YoY) and 138
million yen (+7.0% YoY), respectively, since there will no longer be areactionary drop from the previous fiscal year’s event-driven high demand.
Their contribution to total sales growth is expected to be 15% and 8%,
respectively (Figure 24 on page 29). As a result, the sales proportion of thesubscription businesses is planned to rise to 72.4% (already achieved in thefirst half at 72.9%).
In addition, due to structural changes (trend toward paperless operations
and digitalization), the Company plans a 5.3% sales decline formerchandise. It expects a slight 1.0% increase in the sales of maintenance(shift to the cloud).

28/42This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023【Figure 24】Change in Sales and This Fiscal Year’s Forecasted Sales Breakdown by Category (units: million yen or %)Cloud

Maintenance

Solutions

Merchandise

YoY
Comparison

New AccountingStandard

Previous AccountingStandard

16,000

Products

15,213% of Total

113.2

13,306

2,975

13,382

1,985

439

2,954

3,166
12,00011,436

485

552
10,000

9,358
8,438

8,000

854
1,639

955
1,740

1,954

988

3,098

563

3,518

2,781

3,316

94.7％
107.0％

3,359

101.0％

3,109

1,152

1,496

1,854

FY2016FY2017FY2018

27.6%

1,969

3,327

3,552
3,471

72.4%

3,124

2,000

0

3,701

439
1,103

3,227

1,878

4,000
3,026

2,713

2,516

547
2,107

1,149

577

115.9％

2,452
FY2019

7,282
5,568

5,956

FY2022

FY2022

FY2023

4,057

3,374

FY20205,568

123.5％

SubscriptionBased-Revenue

6,000

2,069
1,767

9,783

12,981

1,403

One-Time-PaymentBased Revenue

14,26414,000

FY2021

FY2024
CE(Ref) Modified and prepared by Alpha-Win Research Dept. based on the financial results briefing and financial results summary (partially edited the YoY
comparison). Sales forecasts (amount; CE) are the amounts forecasted by the Company.
(Note) Since the accounting standard for the posting of sales as merchandise or solutions had been partially changed in FY2020, adjustments were retroactively
made for FY2019 according to the new standard. However, for the two categories, there is no continuity with the years before FY2019. Also, startingin FY2022, the new revenue-recognition standard, etc., have been applied, and the Company has announced its sales forecast based on both the previous
and the new standard for FY2022. “% of Total” is based on the Company’s forecast for FY2024.

w Sales growth rate in thefirst half exceeded theCompany's plan for the fullyear, especially due to thesolutions and the products.

A simple comparison of each sales category’s sales growth rate between
the first-half results and the full-year forecasts shows that the sales growthrate of the solutions and the products in the first half exceeded the full year
plan by about 13 percentage points and 6 percentage points, respectively.
On the other hand, merchandise fell short of the plan by about 5 percentage
points, and maintenance was mostly in line with the plan. The cloud service
grew at a high rate, but was about 2 percentage points below the full-year
forecast. The company-wide sales growth rate was +14.8% in the first half,
which was 1.6 percentage points higher than the plan of +13.2%.
Summary of the Full-Year Forecast (Profit)
Figure 25 on page 30 shows the factors that are expected to increase or
decrease consolidated operating profit (YoY) in the current fiscal year (nochange from the initial plan).

w Forecasting an increase inprofit, since the sales
growth is expected toabsorb the upfront
investment costs, including
investment in new productdevelopment.

To strengthen development of products such as the PCA Hub series for the
next stage of growth, it will increase the cost of sales (+180 million yen
YoY in labor costs and +660 million yen YoY in subcontracting costs), theR&D expenses (+285 million yen YoY), and other SG&A expenses (+332
million yen YoY, including system usage fees and rent expenses). However,
the Company expects the increase in sales (+1,719 million yen) to absorb
all of these costs, resulting in an increase in profit.

w As in the first half, adecline in the gross margin
is expected to be offset by
an improvement in the
SG&A expense ratio.

The gross margin is planned to worsen by 2.1 percentage points from 62.0%
in the previous fiscal year to 59.8% in the current fiscal year. However,since the rate of increase in the SG&A expenses will be held down at +8.7%
YoY, which is lower than the rate of sales growth (+13.2%), the SG&A
expense ratio is expected to decrease by 2.1 percentage points from 52.1%
to 50.0% in the same order.

29/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023
As a result, the operating margin is expected to decrease by only 0.1
percentage point from 9.9% to 9.8%. Although the Company’s businessmodel has a high marginal profit ratio, it expects the sales growth rate andthe operating profit growth rate to be about the same this fiscal year due toupfront investment costs. No major non-operating or extraordinary
income/losses are expected this fiscal year either.

w Due to upfront investment
costs, the operating profit
growth rate is expected to
be about the same as thesales growth rate.

【Figure 25】Factors that Are Expected to Increase/Decrease Operating Profit
in FY2024 (this fiscal year) (the Company’s plan)(Million yen)

4,000
3,500

OperatingprofitSales

Cost of sales

1,719

Increase

3,000

-188

2,500

OperatingprofitSG&A expenses

Decrease

-45
28

2,000
1,500

-740
-285

1,228

1,445
-332

1,000
500
0

FY2023
1
Result2Sales

3 cloud
Cost ofCost
4 ofpurchase

Cost
5 of
ManufacturingSales
6
promotion andadvertisingexpenses

R&D
7
expenses

Other
8 SG&A
expenses

FY20249Forecast

Prepared by Alpha-Win Research Dept. based on the financial results materials.

Summary of Forecast for This Second Half (Sales and Profit)
The Company’s forecast for the second half of this fiscal year, calculated
by subtracting the first half’s results from the full-year forecasts, is asfollows.
【Figure 26】Financial Forecast for the Second Half of FY2024 (the Company’s plan)
Second-Half Results
Results

Second Half of FY2023

Second Half of FY2024: CE% ChangeAmount of Change% of Total

Units: million yen

Oct. 2022 - Mar. 2023

Oct. 2023 - Mar. 2024

YoY: %

YoY: million yen%

Consolidated Sales

Sales by Category

Products
Merchandise
Maintenance Service
Cloud Service
Other Operating Revenue

Gross Profit
Gross Margin (%)
SG&A Expenses
SG&A Expense Ratio (%)
Operating Profit
Operating Margin (%)
Recurring Profit
Recurring Margin (%)
Net Profit
Net Profit Margin (%)

6,818

7,626

11.9

808

100.0

592

690

16.6

98

9.0

355

349

-1.7

-6

4.6

1,639

1,644

0.3

5

21.6

3,096

3,839

24.0

743

50.3

1,135

1,105

-2.6

-30

14.5

4,139

4,368

5.5

229

60.7

57.3

3,688

3,921

54.1

51.4

441

447

6.5

5.9

455

452

6.7

5.9

389

265

5.7

3.5

-3.4
6.3

233
-2.7

1.4

6
-0.6

-0.7

-3
-0.7

-31.9

-124
-2.2

Prepared by Alpha-Win Research Dept. based on the financial results materials.

w Operating profit isexpected to increaseslightly in the second halfof the fiscal year, despite adouble-digit sales growth.
Plans to strengthen sales
promotion.

In the second half of FY2024, the Company expects sales of 7,626 million
yen (+11.9% YoY), operating profit of 447 million yen (+1.4% YoY),
recurring profit of 452 million yen (-0.7% YoY), and net profit of 265
million yen (-31.9% YoY). It expects a double-digit sales growth but aslight increase in operating profit and a more than 30% decline in net profit(Figure 26). The Company plans to intensively spend advertising expenses
in the second half, especially in Q4. In the first-half financial results
briefing by the CEO, it was clear that the Company is confident ofachieving the full-year targets.

30/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

Status of Initiatives for Achieving the Current Fiscal Year’s
Business Plan at Each Company of the PCA GroupThe following (Figure 27) shows the status of initiatives (themes, mattersthat are addressed, plans, current status, and progress) for the current fiscal
year’s business plan that the major companies of the PCA Group are
working on. Measures are generally being implemented in line with the plan.
【Figure 27】(Progress with) Initiatives for FY2024 (this fiscal year)
Company Name

Initiative

Plan・Meet needs related to the new invoicing system and the Electronic Books Presevation Act

Response to law revisions

・Promote the shift to the cloud and subscription versions
・Promote sales of the Hub series to facilitate compliance with law revisions
・Thorough and focused engagement in negotiations for digitalization projects

PCA

Strengthen development Increase recruitment, while also using outsourcing to fill in for shortages
Health management

Shortage of engineers; carrying out the recruitment plan

Raise market penetration of Dreamhop's mental health services

Expanding service by proposing improvement plans based on the results of company diagnosis

Post-COVID19

Enhance customer touchpoints

Online business meetings and remote work have become normal, but more employees are also
returning to the office.

Price revision

Revised in July 2023

Raised prices of main products by about 20% as planned

Cloud shift

Promote the shift to the cloud by developing, advertising, and providing software, as well as providing
various guidance and support

Since solid progress has been made toward achieving FY2024’s goal to raise the number of newusers of the cloud services by 20% YOY, TV commercials will be broadcast in the second half.

Recommend cloud services to existing customers upon product replacement

Steadily increasing recommendations of the cloud services (increasing number of user accounts andcorporate users)

XronosStrengthen related
services
Gain new customers

Develop services that digitalize various internal processes
Released a function which enables API (Application Programming Interface) linkage with the time
Strengthen the linkage of various services (such as the PCA series) with the cloud or with enterprise systems clock data of LINE WORKS
Preparing to collaborate with security product makers (fire alarm manufacturer and access
Improve the acquisition of new customers by strengthening digital marketing and developing new channels
control system provider) as new channels
・Strengthen projects with companies of the private sector

Project enhancement

・Leveraging collaboration with PCA as well as its networks
・Strengthen digital marketing initiatives

Dreamhop

Curren Situation and Progress・New demand related to the revised Electronic Books Preservation Act, the new invoicing system,
and DX expected in the second half as well・Focusing on the Hub series to appeal to users who have not yet adjusted to the law revisions

Differentiate throughvalue adding

Working with PCA to enhance contacts with professional firms and strengthen alliances with EAP(Employee Assistance Program) providers

・Provide an integrated service starting from individual stress checks to conducting group analysis that
・Working on differentiation (a new plan released for the Mental Health Program ORIZIN)
identifies the negative factors in the workplace based on those results, and then providing consulting services
・Comes with a new group analysis report that is based on a psychological correlation diagramfor organization improvement
and an analysis report session in which a specialist will explain and help understand the report
・Promote well-being, improvement of employee engagement, and health management
Started research on the correlation between stress and well-being with Keio University’s Maeno
Laboratory, which is also participated by Nissin HD (and 3 other companies)

R&D

Prepared by Alpha-Win Research Dept. based on the financial results materials.

◆ Alpha-Win Research Dept.’s Financial Forecast for
FY2024 (this fiscal year)
w We have again revised ourfinancial forecast for thecurrent fiscal year upward.

Summary
We reviewed our forecast again for the current fiscal year, taking into
account the the first half’s results, the Company’s plan for the current fiscal
year, and the current situation (Figure 23 on page 28).
We raised our sales forecast from 14,800 million yen in our previous
forecast (as of the report published in August 2023) to 14,900 million yen,operating profit from 1,570 million yen to 2,000 million yen, and net profit
from 1,000 million yen to 1,220 million yen. Accordingly, we also revised
our dividend forecast upward from 18 yen to 19 yen. Compared to theCompany’s plan, our new forecast is 200 million yen greater for sales(+1.4% compared to the Company’s plan), 555 million yen greater for
operating profit (similarly, +38.4%), 295 million yen greater for net profit(similarly, +31.9%), and 2 yen higher than the Company for dividend.

w Strong sales for the cloud,solutions, and products,
which have high profit
margins.

In addition to the strong performance of the cloud service, sales of the
products and solutions have also been exceeding expectations. These sales
categories seem to have high profit margins, so we expect them tocontribute to the Company’s plan in terms of both sales and profits.
Regarding profit, the increase in costs is a point of concern, since there is
inflation in addition to the continued high level of upfront investments indevelopment and in increasing the number of employees. However, theCompany’s full-year forecasts for sales and profit margins seem
conservative since the first half’s sales growth rate was higher than
expected and was able to absorb the cost increase, and the Company has
estimated the increase in the cost of the cloud, R&D expenses, and othermanufacturing costs be greater than they actually would most likely turn

31/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)
w The assumptions/estimates

for the second half of the
fiscal year seem
conservative.

w The risk factor is theimpact of the deteriorating
macroeconomy oncorporate earnings and IT
investment interests.

w Since the Company ismainly focused onsubscription businesses
and benefits fromdigitalization and workstyle reforms, the risks arelimited.

w Increasing costs,
intensifying competition,and slower growth rate of
the cloud service are therisk factors.
w Monetization of the new
businesses will be thechallenge.

w The impact of the new
invoicing system and therevision of the Electronic
Books Preservation Act on
business performance will
be a key point.

w In the medium- to longterm, the M&A strategy
and whether it succeeds aresome of the key points.

Issued: 12/15/2023
out to be in the second half (analyzed by subtracting the factors that
impacted operating profit in the first half from the factors that are planned
to impact operating profit in the full fiscal year). In addition, the price hikes
are expected to fully conribute to the second half’s earnings, and demand
from the two major law reforms is also expected. Therefore, the Company
is likely to exceed its plan if it exercises appropriate cost control.

Risk Factors and Factors that May Cause Change
The main risk factor in the medium-term financial forecast including thisfiscal year is that the corporate users’ business performance and IT
investment interests may worsen due to a stagnation of economic activities
in response to an outbreak of infection or its prolongation, the inflation andlogistics disruption caused by the Russian invasion of Ukraine, increased
geopolitical risk due to the Israel-Hamas war, the global economic
downturn, wild fluctuations of exchange rates, and revisions of Japan’sloose monetary policy. These may cause the corporate users to refrain frompurchasing products and services or to postpone their implementation.
However, any further adverse effects by external factors will most likely belimited. Additionally, the current services of the PCA Group are centeredon stable subcription businesses and the Company’s businesses andoperations have a high affinity with remote work and work-from-home. It
also benefits from the digitization and work-style reforms of companies andthe society. Also, in the current fiscal year, Japanese companies’ financial
performance is forecasted to remain strong with growth in both sales andprofits, and risks due to macroeconomic factors are expected to be limited.
Other risks include increase in costs due to rising labor costs, personnel
expenses, and subcontracting costs, as well as a slower growth rate of thecloud business due to intensifying competition with competitors.
In addition, although presumably not included as a large part of the budget,
progress may not be made as expected regarding the new services such as
PCA Hub, PCA Subscription, the healthcare business, and hyper in terms
of providing these service, acquiring new customers, and promoting theirsales. Monetization of these new businesses will be the challenge. In
particular, Dreamhop seems to be continuing to post a net loss, which isperhaps even worsening, and drastic business transformation will be needed.
Other factors that may impact the Company’s results include the new
invoicing system (October 2023) and the revision of the Electronic Books
Preservation Act (January 2024). Currently, the Company is not
anticipating any large, event-driven high demand, but demand may change
significantly within a short time span before and after the introduction of
the new regulations. Their impact on sales and profit (especially on theupside) should be closely watched.
In addition, if a new M&A is conducted, whether it succeeds or not will
impact business performance. Going forward, the Company will need to
improve the efficiency of capital investment from the perspective of (1)identifying M&A targets that are expected to create high synergies andquickly contribute to the PCA Group’s performance and (2) effectively
utilizing its abundant cash and deposits for its growth strategy (for example,
acquiring profitable companies and businesses which are related to theCompany’s business and which have little goodwill at the time ofacquisition and are therefore undervalued, or closing and selling
unprofitable businesses).

32/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

8． Growth Strategy◆ Medium- to Long-Term Vision and Policy
w Long-term vision is tobecome a “Management
Support Company”
focused on the business ofproviding management
support to its corporate
customers.
w Created a new mediumterm plan. For sustainablegrowth, it will strengthen
its development capacity,
build its businessfoundation, and transform
its business structure.

w Will execute priority
measures based on four
themes.
w The main pillars of themedium-term plan are tostrengthen thesubscription-based
business model, meet
digitalization needs, createbusiness opportunities,
and strengthen its
development and service
system as well as
management foundation.
(15） DX: Stands for Digital
Transformation. Changing
lifestyles and businesses throughdigital technologies.

Long-Term Vision
The PCA Group’s long-term vision through FY2031, when it will reach its
50th anniversary, is as follows: “By providing a greater variety of one-stop
services for corporate management and operation, we will become a true
Management Support Company that is focused on the management-support
business for our corporate customers.”
New Medium-Term Management Plan
The Company has been creating medium-term management plans for threeyear spans and has announced a new medium-term management plan
(FY2023 to FY2025) that started last fiscal year. Its medium-term basic
policy is to “transform the business structure and build the foundation forcontinuing and developing stable businesses over the long term” and aims
to “optimize the company’s structure for creating customer-oriented new
businesses, products, and services ahead of changes in the society.”
There has been no change to this medium-term plan so far. To provide totalsolution services centered on software, it has been working on the following
themes: (i) establish a strong revenue base for the core businesses, (ii) create
new business opportunities, (iii) strengthen monozukuri (creation of things)
with a focus on safety, security, and anticipation of needs, and (iv)strengthen the management foundation toward a high-profit structure (fordetails of the priority measures and their progress, see Figure 29 on page
34 of the full report published in June 2023).
The priority measures have basically been developed based on the previous
medium-term plan. By first strengthening the subscription-based businessmodel centered on the cloud business, and then strengthening thedevelopment and service structure, the Company plans to support the DX15of operation by small/medium-sized companies.
In addition, it plans to work on its own DX and strengthen its managementfoundation such as governance and structure to achieve sustainable growth.

◆ Management Indicators Set as Goals
w As numerical goals of themedium-term plan, seven
items have been set fromthe perspectives ofbusiness performance,
capital efficiency, andshareholder returns.

w Currently, the sales-related
targets seem achievable,
but the profit-related
targets are a high hurdle.

Numerical Goals of the New Medium-Term Plan
The seven items below have been set as the numerical targets for the current
medium-term management plan (the goals for the final year are for FY2025
or the next fiscal year) from the perspectives of business performance,
capital efficiency, and shareholder returns (Figure 28 on page 34). Thesetargets have not been changed so far. Aside from the two items related tosales, all figures have already been achieved in the past, such as during
periods of event-driven high demand. Therefore, they seemed at first to berealistically achievable targets.
However, a comparison of this fiscal year’s forecast with the goals of the
final fiscal year of the plan (next fiscal year) shows a large deviation, withthe exception of sales and dividend payout ratio. In particular, achieving
the targets for consolidated operating profit, ROE, and DOE is realisticallya high hurdle.

33/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023【Figure 28】Goals of the Medium-Term Management Plan and Their Progress/Outlook
Goals of the Current Medium-Term Management Plan
(FY2022 - FY2025)

FY2025: Company Plan

・Consolidated Sales

Business
Performance

Record HighY14.27 billion (FY2020)

Goals and Results of the Final Year of the Previous Medium-Term Management Plan (FY2022)
Initial Goals
Revised Goals
Results(as of April 2019)(Previous FY)
Y13.38 billion
Y11.5 billion or more
Y13.5 billion or more

Y15 billion or more

Y14.7 billion

Of which, sales of the subscription
businesses (maintenance & cloud)Y9.5 billion or more

Y10.64 billion

Y9.28 billion (FY2023)

Y8.88 billion

Achieve Y6 billion

Achieve Y7.5 billion

・Consolidated Operating Profit

Y2.5 billion or more

Y1.45 billion

Y2.65 billion

Y1.5 billion or more

Y2.1 billion or more

・Consolidated Operating Margin

16% or more

9.8%

Y2.78 billion (FY2020)
During the past 10 years: 19.8% (FY2022)
During the longest period with data
available: 28.5% (FY1999)

19.8%

10% or more

15% or more

10% or more

5.2% (Alpha-Win's estimate)

14.4% (FY2022)

14.4%

2.5%
30.0%

1.9% (Alpha-Win's estimate)
36.7%

Asset Efficiency ・ROE
Shareholder
ReturnFY2024: Company Plan

・DOE
・Dividend Payout Ratio

2.9%
20.3%

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials. The plan was announced by the Company.
(Note) Values have been rounded to the nearest unit.

◆Alpha-Win Research Dept.’s Forecast of Medium-Term
Financial Results
w We revised our mediumterm financial forecasts.

w We have assumed that theJapanese economy willremain solid after thisfiscal year too.

w We reconsidered ourestimates for the sales ofeach sales category and thecosts.

We reviewed our medium-term forecast for the three fiscal years including
the current fiscal year (Figure 29 on page 36). For the next fiscal year andthe fiscal year after the next, we have kept our sales forecast the same andupwardly revised our profit and dividend forecasts.

Macroeconomic Assumptions
The outllook of the macroeconomic environment is unclear due to factors
such as the depreciation of the yen, inflation due to soaring resource prices,geopolitical risks, and recession worries. However, socieal and economic
activities are returning to normal, so we have assumed that corporate
earnings and IT investments by companies in Japan will improve. At
present, we do not anticipate any high demand related to tax systems,
accounting standards, and product versions.
Estimates/Asusmptions Used for Sales, Expenses, and Profits
We reviewed our estimates for costs and sales by category, especially forthe products, the cloud, and other operating revenue (solutions and other).
We continue to predict that the merchandise’s sales will decline as morecompanies shift to paperless operations and that the sales of maintenanceservice will also continue to drop due to the shift to the cloud.

w We expect the operating
margin to gradually
improve YoY.

On the other hand, we predict that the Company will be able to control its
results to a certain extent due to the increase in the cloud’s sales (growth ofabout 10-20% per year), the improvement of the product mix with theincreasing proportion of the cloud, the transition of various businesses tothe subscription-based business model, and the streamlining of businesses.
We therefore predict that although the SG&A expense ratio will gradually
increase, the gross margin will improve so that the operating margin will
gradually rise. Consequently, we expect profit to increase mainly due tosales growth.

w The cloud and work
management software willcontinue to be the growth
drivers.

Since the growth potential of the cloud service (accounting software, work
management software, etc.) is high, we believe that it will continue to be
the growth driver, absorbing the increase in upfront investments, sales
promotion expenses, and personnel expenses and contributing to theincrease in sales and profits.
In addition, as the COVID-19 crisis settles down, the Company should be
able to start providing on-site support to its customers and conduct inperson sales like before. Also, if the Company could put its current new
businesses on track (the mental health business, PCA Subscription, andHyper that it is struggling with) and monetize them, they should be able tomore solidly support the growth trend for sales and profit.

34/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)
w We raised our profit
forecasts for the next fiscal
year.

Issued: 12/15/2023

Forecast for the Next Fiscal Year (FY2025)
For the next fiscal year, we have kept our forecast for sales the same at
15,520 million yen, but we have raised our forecast (in the order of ourprevious forecat to our new forecast) for operating profit from 1,700 million
yen to 2,100 million yen, recurring profit from 1,730 million yen to 2,130
million yen, and net profit from 1,080 million yen to 1,280 million yen.

w The price hikes are
expected to fully
contribute to the results.
The cloud service is
expected to continue togrow, while the costs willremain high but peak out.

We expect sales to increase due to the price hikes fully contributing toearnings (they will only contribute to about nine months of earnings for thisfiscal year since prices were raised in July) and the steady growth of boththe cloud service and the products. Although a high level of upfront
investment and high costs due to inflation will most likely continue in thenext fiscal year, we expect them to peak out and have reflected thisexpectation in our forecasts.

w In the next fiscal year, thegrowth rates are expected
to slow down, but we
expect increases in sales
and profits, as well as
consecutive increases in
dividend.

Although we have upwardly revised our forecasts for the next fiscal year,
we expect the growth rate to be slower than our new forecast for FY2024,
at a 4.2% growth rate for sales and a 5.0% growth rate for operating profit.
However, since we expect that the Company will continue to increase sales
and profit in the next fiscal year, we have raised our forecast for dividend
per share by 1 yen from this fiscal year’s forecast to 20 yen.

w Our profit forecasts are
below the goals of themedium-term management
plan.

Compared to the Company’s medium-term management plan whose sales
goal is 15,000 million yen, our forecast is 520 million yen higher, but for
operating profit, our forecast is 400 million yen lower than the Company’s
target of 2,500 million yen. To achieve the profit target, the Company
would need an event-driven high demand or need to reduce upfront
investments and costs, achieve a recovery in Dreamhop’s performance, andhave its new services contribute significantly to earnings.

w We expect increases insales, profits, and dividendin the fiscal year after the
next, too.

w We revised downward ourforecast for the mediumterm profit growth rate.
Rising costs and delays inmonetizing the new
products/services havebeen reflected in thefinancial forecasts.

w With the subscription
business as the growth
driver, we expect theannual profit growth rateover the medium to longterm to be 5-8%.

Forecast for the Fiscal Year After the Next (FY2026)
For the fiscal year after the next, we have maintained our sales forecast at
16,500 million yen (+6.3% YoY), while we have raised our operating profit
forecast from 1,800 million yen to 2,250 million yen (+7.1% YoY) and ournet profit forecast from 1,135 million yen to 1,350 million yen (+5.5%
YoY). We also raised our forecast for dividend per share to 21 yen, whichis 1 yen greater than our forecast for FY2025.
Forecasted Profit Growth Rate over the Medium/Long Term
Since the cloud business (subscription business), which is the Company’s
core business as well as its growth driver, is based on a subscription modelwith a high marginal profit ratio, its sales growth is expected to directly
contribute to profit growth, with the company-wide profit growth rate
exceeding the sales growth rate. Over the medium term (three to five years
starting this fiscal year), we had previously expected that the subscription
business (manily the cloud service) will drive growth so that the annual
profit growth rate will be 8-10% (based on normalized figures excluding
the effects of event-driven high demand).
However, we have revised our forecast to a 5-8% profit growth since thelevel and span of upfront investments for the next phase of growth, as wellas the rise in general costs due to inflation, have been greater than expected,
and also because there have been delays in the contribution of the new
businesses to profit.
Finding and developing new growth businesses that will contribute toearnings will mostly likely impact the Company’s future growth rate.

35/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023【Figure 29】Medium-Term Financial Forecast
Units: million yen or %Sales

Category

FY2025 CE
Medium-Term Plan

FY2024 Old E

FY2025 Old E

FY2026 Old E

15,00014,80015,52016,500

1,600

1,600

1,500

1,600

500

480

520

530

520

3,360

3,350

3,340

3,330

3,370

3,380

7,282

7,300

8,100

9,050

7,100

8,100

9,100

2,107

2,220

2,020

2,030

2,250

2,020

1,900

8,051

8,797

9,300

10,00010,750

9,050

9,750

10,400

62.0%

59.8%

62.4%

64.4%

65.2%

61.1%

62.8%

63.0%

FY2023

FY2024: CE

FY2024: New E FY2025: New E FY2026: New E

13,382

12,981

14,70014,90015,52016,500

Products

2,954

1,149

1,403

1,500

1,550

Merchandise

439

577

547

520

Maintenance Service

3,316

3,327

3,359

Cloud Service

5,568

5,956

Other Operating Revenue

1,103

1,969

8,808
65.8%

Gross Profit
Gross Margin
SG&A Expenses

9,500

6,153

6,763

7,351

7,300

7,900

8,500

7,480

8,050

8,600

(ratio to sales)

46.0%

52.1%

50.0%

49.0%

50.9%

51.5%

50.5%

51.9%

52.1%

2,655

1,288

1,445

2,000

2,100

2,250

2,500

1,570

1,700

1,800

(ratio to sales)

19.8%

9.9%

9.8%

13.4%

13.5%

13.6%

16.7%

10.6%

11.0%

10.9%

2,697

1,326

1,478

2,030

2,130

2,280

1,600

1,730

1,820

(ratio to sales)

20.2%

10.2%

10.1%

13.6%

13.7%

13.8%

10.8%

11.1%

11.0%

2,367

883

925

1,220

1,280

1,350

1,000

1,080

1,135

(ratio to sales)

17.7%

6.8%

6.3%

8.2%

8.2%

8.2%

6.8%

7.0%

6.9%

Products

0.6%
48.8%

-3.0%
-61.1%

13.2%
22.1%

14.8%
30.5%

4.2%
3.3%

6.3%
3.2%

14.0%
39.3%

4.9%
-6.3%

6.3%
6.7%
-1.9%

Operating Profit
Recurring Profit
Net Profit

Sales (YoY growth rate)

Category

FY2022Merchandise

-9.5%

31.4%

-5.2%

-9.9%

-3.8%

-4.0%

-9.9%

1.9%

Maintenance Service

-6.6%

0.3%

1.0%

1.0%

-0.3%

-0.3%

0.1%

1.2%

0.3%

Cloud Service

37.2%

7.0%

22.3%

22.6%

11.0%

11.7%

19.2%

14.1%

12.3%

Other Operating Revenue-65.8%

78.5%

7.0%

12.7%

-9.0%

0.5%

14.3%

-10.2%-5.9%

Gross Margin (% YoY diff.)

5.7%

-3.8%

-2.2%

0.4%

2.0%

0.7%

-0.9%

1.7%

0.2%

SG&A Expenses (% growth)

8.2%

9.9%

8.7%

7.9%

8.2%

7.6%

10.6%

7.6%

6.8%

Operating Profit (% growth)

7.6%

13.3%

12.2%

55.3%

5.0%

7.1%

21.9%

8.3%

5.9%

Recurring Profit (% growth)

14.7%-51.5%

11.4%

53.1%

4.9%

7.0%

20.7%

8.1%

5.2%

Net Profit (% growth)

14.1%-50.0%

4.8%

38.2%

4.9%

5.5%

13.3%

8.0%

5.1%

16.0%

(Ref) Prepared by Alpha-Win Research Dept. CE: the Company’s forecast/estimate. E: Alpha-Win’s forecast/estimate. Old E: the previous forecast. New E: thecurrent forecast.

36/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

9． Analyst’s View
◆ PCA’s Strengths and Challenges
The Company’s SWOT analysis has been updated and the results are listed
in Figure 30. There has been no major change.
【Figure 30】SWOT Analysis
・ Brand recognition and credibility earned over many years (major specialized player in the enterprise system software market targeting small/medium-sized companies)
・Firm financial standing (debtless management) and stable cash flow; ample cash & deposits exceeding annual sales
・Growth of the subscription business based on continuous payment for service; capable of stably generating revenue (became a cash-cow business); subscription businesses areabout 73% of total sales
・ Strong and diversified customer base (240,000 corporate users in total); largest customer is RICOH (about 25% of total sales)

Strength

・Taking a lead with the cloud (top-level company for enterprise system software business targeting small/medium-sized companies; expertise; more than 22,000 corporate usersof the PCA Cloud)・High barrier to market entry
・Very experienced call center staff and engineers (support capability)
・Rich product lineup with track record; capacity to provide and develop products and services both as on-premises and cloud services
・ Sales capability: sales network with sales offices throughout Japan (13 offices) and 2,000 partnered companies
・Relatively somewhat low profit margins
・Financial results susceptible to revisions related to accounting and tax laws, end of OS support, etc. (consumption tax, change in the name of the era, Windows version, etc.)

Weakness・Sluggish performance of Dreamhop; delay in the contribution of the new services and products to earnings
・Absence of a major, next-generation, growth-driving product/service
・Domestic-demand oriented; overseas expansion difficult
・Increasing demand due to labor shoratage and the neeed to streamline operation (for business software in general); work-style reform (work management system)
・Potential to develop and increase the market penetration of the cloud service (toward small/medium-sized companies and mid-tier companies)

Opportunity

・New products (hyper, PCA Hub, etc.), new services (transition of on-premises to subscription-based model), and innovations in technology
・Development of HR businesses
・Revisions in laws and regulations related to accounting, tax, etc. (the revised Electronic Books Preservation Act, invoicing system, changes in Windows OS, changes in
consumption tax rate, etc.)
・Emergence of an alternative as advanced AI technology becomes widely used, delayed product development, defects in products, etc.
・High competition (maturation of on-premises market; other companies catching up with the Company in the cloud business; new companies entering the market in the low
price range)

Threat・COVID-19 outbreak/prolongation and worsening business performance of Japanese small/medium-sized companies due to the worsening global macroeconomy
・Contract termination risk, etc.
・System troubles and information leakage
・Rise in subcontracting, personnel, and development costs(Ref) Prepared by Alpha-Win Research Dep. Words in red indicate additions or revision made in this Report.

w Credibility and trackrecord built over many
years, customer base,expertise in technology,
ample cash & deposits, andfirm financial base are its
strengths.
w Also has a competitiveedge and top-level
performance with the cloudbusiness that it is taking alead. The cloud market has
a high growth potential.

w The challenge will be toturn Dreamhop profitableand develop the next
pillars of new
products/services.

Describing the strengths in more detail, the Company’s brand, products,
and services are well known thanks to its long years of service andcredibility. It is especially strong in certain areas of business (such asaccounting software for small/medium-sized companies). Its customers
also have high loyalty toward products and services, as there is little
incentive to frequently change the enterprise system software. Additionally,
through its maintenance support, cloud services and version upgrades, theCompany has developed a subscription-based business model that is highly
maintainable and stable. It is leading the market with the cloud service,
which has a high growth potential, and its competitive edge and top-level
performance are its strengths.
Also, it has a solid financial base with no debt and abundant cash anddeposits which exceed the annual sales. These are enhancing the stability,
reliability, and flexibility of management.
On the other hand, looking at the weaknesses in more detail, the Company
has been searching for the next, new major products and services and forways to gain market share among mid-tier companies, but has not yet beenable to develop businesses that would create enough scale advantage.
Regarding companies that have joined the group through M&As, it failed
to create synergies with MACS System Corporation and Keepdata Ltd. andended up selling them, while Xronos has been a successful exception. Also,
about three years have passed since the acquisition of Dreamhop. Even
though the Company has been working on bolstering its performance byincreasing its capital, collaborating within the PCA Group, and expanding
its sales network and services, its performance appears to have been

37/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023
sluggish. There also seems to be a delay in the contribution of the newservices and products to earnings, which is another challenge.

w Business volatility
increases before and after
events due to event-driven
high demand.

As for the opportunities and weaknesses (or threat), we have seen in thepast that the volatility of financial performance tends to increase before andafter periods of high demand caused by events such as the consumption tax
revision, the work-style reform, end of Windows support, termination of
support for the old product series, and upgrades (this fiscal year’s revisedElectronic Books Preservation Act and new invoicing system are notexpected to have as much of an impact as an event-driven high demand).

w Aiming for non-priceIn the cloud service that it is taking a lead, the Company is aiming for nonprice competition through product strength, service, and support. However,its competition with major companies that have followed suit and withservice providers that provide limited functions at lower prices will be thekey points.

competition. Competition
with its competitors will
be a key point.

◆ Shareholder Return and Shareholder Benefit Program
Dividend Policy
The Company’s basic policy is to continue the stable payment of dividend
while improving the ratio of net profit to shareholders’ equity (ROE) undereffective business management. Regarding shareholder returns, its policy is
to determine the level of dividend to be paid based on a comprehensive
analysis of elements such as its financial results and the dividend payout
ratio.

w Stable payment ofdividend is its basic policy.

Dividend History
For many years since FY2011, the Company had been paying an annual
ordinary dividend of 10.3 yen per share, excluding commemorative
dividend (retroactively adjusted for the stock split; the same shall apply
hereinafter). In FY2020, it increased dividend by 1 yen to 11.3 yen per share.
It then raised dividend consecutively to 13.0 yen (+1.7 yen) in FY2022 andto 17.0 yen (+4.0 yen) in FY2023. During this period, the Company also
paid commemorative dividends three times.

w No decrease in ordinary
dividend in the past. Has
been increasing dividendin recent years.

In recent years, the Company seems to be gradually increasing its ordinary
dividend and also intentionally paying commemorative dividends
whenever there is an opportunity (Figure 31).
【Figure 31】Change in Dividend and Dividend Payout Ratio (reflecting stock split)
Dividend (right axis)
Dividend Payout Ratio (left axis)

（％）

300.0

Commemorative Dividend (right axis)

（円）

30.0

281.1

250.0
200.0

w 目標配当性向は 33％、150.0
純資産配当率は2.5％が目標。実績と乖離が100.0
大きく、中長期的には
50.0
10.0
10.0
増配余地がある。

10.3

47.8

47.2

FY2010FY2011

0.0

25.0

24.0

30.9
FY2009

18.0

116.9

13.3

20.0

11.0

15.0

6.7

132.0

3.3
19.0

20.0

21.0

10.0

38.5

31.2

31.3

31.2

5.0

FY2023

FY2024(E)

FY2025(E)

FY2026
(E)

17.0
10.3

FY2012

10.3

FY2013

10.3

10.3

10.3

46.5

ＮＡ

ＮＡ

FY2014FY2015FY2016

10.3

10.3
48.2

FY2017FY2018

10.3

13.0

11.3

11.3

19.8

13.6

20.3

FY2020

FY2021

FY202223.3
FY20190.0(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary.
(Note) Retroactively adjusted for the 3-for-1 stock split on October 1, 2021. Estimates/forecasts (E) were made by Alpha-Win.

38/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)w This fiscal year, it plans tocontinue to pay dividendsof 17 yen/share and exceed
the target dividend payout
ratio of 30%.

w The goal for dividend on

equity (DOE) is 2.5% but
this fiscal year’s DOE is
expected to fall below thistarget.

w Enhancing shareholder
returns.

w The actual annual net yield
including the shareholder
benefit program is about
2.1% (at maximum).

Issued: 12/15/2023
The target dividend payout ratio is 30%, but the actual ratio was 13.6% in
FY2021 and 20.3% in FY2022, both falling below the target. However, theratio exceeded the target at 38.5% in FY2023 because the ordinary dividend
was increased, although the EPS had declined. For the current fiscal year,
the Company plans to continue to pay an ordinary dividend of 17 yen per
share at a dividend payout ratio of 36.7% (based on the Company’s
forecasts). Based on a stock price of 1,111 yen (closing price of December
15, 2023), this fiscal year’s dividend yield is estimated to be about 1.5%.
Dividend on equity (DOE), which is one of the Company’s KPIs (keyperformance indicators), was 2.9% in FY2022, exceeding the target of 2.5%.
However, in FY2023, the DOE was 2.0%. This fiscal year, too, the DOE is
expected to fall below the target at around 1.9% (our estimate based on the
Company’s current forecasts).
Since profits are impacted greatly by whether there is an event-driven highdemand, the dividend payout ratio and the DOE also tend to fluctuate.
However, the Company has been generally increasing its ordinary dividendand enhancing shareholder returns.
Dividend Yield
As a shareholder return measure, the Company has a shareholder benefit
program and gives out Quo Cards to shareholders based on the number ofshares they own at the end of March of every year. For example,
shareholders with equal to or greater than 300 shares and less than 900
shares are granted 2,000 yen of Quo Card. Based on a stock price of 1,111
yen, the actual annual net yield for a shareholder owning 300 shares is about
2.1% (at maximum) including an ordinary dividend of 17 yen and theshareholder benefit program (Figure 32).
Based on the same conditions, the actual annual net yield of its twocompetitors is about 1.5% for OBC (4733: Obic Business Consultants)(including its shareholder benefit program) and about 2.7% for MJS (9928:
Miroku Jyoho Service) (only dividend yield since it does not have ashareholder benefit program).

【Figure 32】Shareholder Benefit Program and Actual Net Yield
Number of Shares Owned(less than)(greater than or equal to)
300
900
900
1,500

1500

Shareholder Benefit
Net Yield
Dividend: Y(Quo Card: Y)(maximum):
2,000
17
2.13
3,000

17

1.83

4,000

17

1.77

(Ref) Prepared by Alpha-Win Research Dept.
(Note) Actual dividend yield = (Dividend + Shareholder benefit program’s value) / Stock price; calculated based on theminimum number of shares owned for each range. Share price: 1,111 yen (closing price on December 15, 2023).

w Conducted a stock split in
2021 and a stock
cancellation in 2022.

Stock Split, Stock Cancellation, and Treasury Shares
A 1.3-for-1 stock split was conducted in May 2000. Then, for the first timein approximately ten years, it conducted another stock slit (three-for-one
stock split) in October 1, 2021 (there has been no stock split since then).
In December 2022, the Company cancelled 1,100 thousand shares (4.8% of
all outstanding shares before the cancellation) out of approx. 3,001
thousand shares held as treasury shares. As a result, as of the end of
September, there are 22,000 thousand outstanding shares in total and theCompany owns 1,967 thousand shares as treasury shares (8.94% of all
outstanding shares).
39/42

w 目標配当性向は 33％、純資産配当率は 2.5％が目標。実績と乖離が大きく、中長期的には増配余地がある。
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023◆ Stock Price and Factors that May Affect Stock Price
Performance
The Company’s stock price and relative stock price compared to the
TOPIX over the past approximately seven and a half years are described in
the summary section (Figure C on page 4). Its stock price has risen byapprox. 3.7x during this period, significantly outperforming the TOPIX
which has meanwhile only increased by 1.7x.

w With solid financial
performance, stock pricehas increased largely andhas been significantly
outperforming the TOPIX
over the past
approximately seven and ahalf years.

Also, over the approximately seven and a half years since May 2016, theCompany’s stock performance has been the strong along with OBC whencompared among the three competing companies (the Company and its twocompetitors [4733 Obic Business Consultants or OBC and 9928 Miroku
Jyoho Service or MJS]) (Figure 33).
However, since the beginning of the year, it has been underperforming its
two competitors and the TOPIX. This is likely because it is a small,defensive stock and there were no positive surprises in its financial results
announcement for the first half of the current fiscal year.

w Has been underperformed

its competitors and the
TOPIX since the beginningof the year.

【Figure 33】Comparison of Stock Performance with Competitors
400%

PCA (9629)

OBC (4733)

MJS (9928)

350%
300%
250%
200%

w 過去 2 年間で同社株は、150%

同業 2 社を大幅にアウ
トパフォーム。 100%50%

Dec 2023

Jun 2023

Sep 2023

Dec 2022

Mar 2023

Jun 2022

Sep 2022

Dec 2021

Mar 2022

Jun 2021

Sep 2021

Dec 2020

Mar 2021

Jun 2020

Sep 2020

Dec 2019

Mar 2020

Jun 2019

Sep 2019

Dec 2018

Mar 2019

Jun 2018

Sep 2018

Dec 2017

Mar 2018

Jun 2017

Sep 2017

Dec 2016

Jun 2016

Sep 2016-50%

Mar 2017

0%(Ref) Prepared by Alpha-Win Research Dept.
(Note) Stock price as of the end of June 2016 was set to zero upon creating the graph. Reflects prices up through theclosing price of December 15, 2023.

Valuation
Based on the Company’s current stock price, its valuation seems expensive
in terms of the main valuation indicators compared to the average of all
stocks listed on the TSE Prime Market on which it is listed (Figure 34).
【Figure 34】Comparison of Valuation and Performance with Major Indices
Stock Price / IndicesThis Fiscal Year's
P/E Forecast

Actual P/B (at the endof quarter)

Dividend Yield(simple average)

Return Since theBeginning of the Year

Return Since the Endof April 2022

Return Since
Oct. 23, 2023

PCA (P 9629)
Average of All TSE Prime Stocks: P
Average of All TSE Standard Stocks: S
Average of All TSE Growth Stocks: G

1,111
1,200.01
1,148.42
858.35

24.01
14.84
14.27
52.37

1.26
1.26
0.97
3.15

1.53
2.29
2.30
0.54

-17.21
-

-15.6
22.8
19.0
-2.3

-1.3
4.2
5.1
5.0

TOPIX

2,332.28
677.5732,970.55

14.52

1.29

2.01

23.29
-7.23
26.4

22.8
-2.4
22.8

4.2
6.6
6.4

Closing price of Dec. 15, 2023

TSE Growth 250 (former TSE Mothers)

Nikkei Stock Average(Ref) Prepared by Alpha-Win Research Dept. based on various stock price data. （Note) PCA's P/E and dividend yield are based on its forecast
and actual figures.

40/42This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

w Valuation is expensive

Compared to the TSE Prime’s forecasted average P/E of 14.84, theCompany’s P/E based on its forecast is 24.01. Similarly, compared to TSE
Prime’s actual P/B of 1.26, the Company’s is the same at 1.26, andcompared to the TSE Prime’s forecasted dividend yield (simple average)of 2.29%, the Company’s is 1.53% (based on the closing price of December
15, 2023).

w Valuation also does not

Based on our profit forecasts, the Company’s P/E is expected to be 18.2 forthe current fiscal year, 17.4 for the next fiscal year, and 16.5 for the fiscal
year after the next. When its valuation is compared with its two competitors(OBC and MJS), the Company’s valuation is cheap in terms of P/B and
EV/EBITDA but about average in terms of the other valuation indicators(P/E, dividend yield, and P/S), indicating no cheapness based on absolutevalues either (Figure 35).

compared to the TSE
Prime’s average valuation
based on this fiscal year’s
forecasts.

seem underpriced
compared to its two
similar, listed competitors.

【Figure 35】Comparison of Valuation with Competitors
Company Name

Market where listed, stock price, andvaluation

Company Forecasts for This Fiscal
Year (full year)* PCA, OBC, and MJS:Forecasts for FY ending Mar. 2024
*MF: Forecasts for FY ended Nov. 2023
*FR: Forecasts for FY ending June 2024

Last Fiscal Year's Full-Year Results
Past Growth Rates

This First Half's Results* PCA, OBJ, and MJS: First half ended
Sept. 2023
*MFR: First half ended May 2023
*FR: First haf ending Dec. 2023 (before
announcement)

Code (TSE Prime Market)
Stock price (closing price of 12/15/2023)
Market cap (million yen)
P/E (price-to-earnings ratio)
P/B (price-to-book ratio)
Dividend yield (%)
EV/EBITDA
P/S (price-to-sales ratio)
Sales (million yen)
Gross Margin (%)
Operating Profit (million yen)
Operating Margin (%)
EPS (company forecast): YoY change (%)
DOE (%): Result
Past 10 Years' Sales Growth Rate
Past 10 Years' Operating Profit Growth Rate
Equity Ratio (%)
Sales (million yen)
Sales Growth Rate
Operating Profit (million yen)
Profit Growth Rate
Operating Margin (%)% Progress with Sales (vs. Full-Year Plan)% Progress with Operating Profit (vs. Full-Year Plan)

PCA(consolidated)

Obic Business Consultants(OBC: nonconsolidated)

Miroku Jyoho Service(MJS: consolidated)

Money Forward(MF: consolidated)

freee(FR: consolidated)

9629 P

4733 P

9928 P

3994 P

4478 G

1,111
24,442
24.0
1.3
1.5
3.3
1.7
14,700
59.8
1,445
9.8
4.8
2.0
77.2
650.0
56.7
7,074
14.8
998
17.8
14.1
48.1%
69.1%

6,665
502,568
40.3
3.5
1.1
20.7
12.6
40,00082.2
16,860
42.2
12.7
3.8
105.3
122.9
77.6
19,488
20.1
8,162
20.3
41.9
48.7%
48.4%

1,654
57,570
12.1
2.0
2.7
5.9
1.4
41,600Not disclosed
6,100
14.7
8.6
5.8
74.9
110.5
54.2
21,174
6.5
2,799
-9.7
13.2
50.9%
45.9%

4,266
231,344
7.9
Negative
7.7
29,961
Not disclosed-6,415-

3,080
179,160
6.9
Negative
7.1
25,400Not disclosed-8,225-(Past 10 years: 0 ⇒ 21,477) (Past 8 years: 216 ⇒ 19,219)(Past 6 years: -876 ⇒ -8,469)(Past 4 years: -2,830 ⇒ -7,918)

42.3
14,08743.2-3,502
47.0%
54.6%

59.5
-

(Note)
・P and G of the TSE Market stands for the Prime and Growth markets, respectively.
・Market cap = total outstanding shares x market stock price [closing price of December 15, 2023]
・EV/EBITDA = (market cap + interest-bearing debt - cash & deposits) / (operating profit + depreciation + intangible fixed asset amortization, etc.)*Interest-bearing debt and cash & deposits are actual quarterly values. Operating profit is based on this fiscal year’s company forecasts. Depreciationand intangible fixed asset amortization have been calculated for the full year based on actual values (or the company’s full-year forecast).
・The companies’ forecasted EPS for this fiscal year (ending March 2024 for PCA, OBC, and MJS; ended November 2023 for MF; and ending June 2024
for FR) was used in the P/E calculations.
・BPS values used in the P/B calculations are results for the most recent quarter.
・Dividend is based on the companies’ forecasts for this fiscal year.
・P/S = market cap / sales [the companies’ forecast]
・The average value is used when the forecast is disclosed as a range.
・Past 10 year’s growth rate is a simple comparison of the most recent full-year result and the full-year result of 10 fiscal years ago.
・Equity ratios are based on the latest quarterly results (for FR only, Q1 results for the current fiscal year were used instead of the first-half results).
・Fiscal years of PCA, OBC, and MJS are March-ending, MF’s fiscal year is November-ending, and FR’s fiscal year is June-ending.
(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summaries

w The two competitors forcloud-based accounting
have extremely highvaluations.

Money Forward (TM: 3994) and freee (TM: 4478) described earlier are
also the Company’s competitors among listed companies in the area ofcloud accounting software. However, they are not reasonable targets forvaluation comparison since they have been posting net losses and paying
no dividend. Their valuations are extremely expensive compared to theCompany in terms of the comparable valuation indicators of P/S and P/B.

41/42
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,winformationor fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

株主優待制度を、一部拡充。優待を含めた実質年間利回りは、約 3％w
w

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/15/2023

Stock Price Outlook
The economic situation remains uncertain due to inflation and the higher
interest rates following the Bank of Japan’s adjustment of monetary easing,in terms of situations in Japan, and globally due the prolonged war in
Ukraine and Israel, global inflation, and recession worries.
w Domestic-demand-oriented
growth stock with highgrowth potential. The key
themes are cloud,subscription, DX(including the new
invoicing system andElectronic Books
Preservation Act), workstyle reform, and mental
healthcare.
w Trends of increasing sales,
profit, and dividend arealso expected in the next
fiscal year and beyond.

w Considering the growthpotential over the medium
term, we believe that there
is an upside to the stock
price.

w Key points are this fiscal
year and next fiscal year’s
results, the profit growthrate over the medium term,
the cloud’s growth rate, themonetization of the new
businesses/services(especially PCA Hub andDreamhop), measures toreturn profit toshareholders, andutilization of its cash.

However, the Company still has strengths and high growth potential in its
subscription-based businesses, including the maintenance service for its
packaged, enterprise system software and the cloud or subscription
versions of its products. It will most likely continue to be seen as adomestic-demand-oriented growth stock which can benefit from thegovernment’s promotion of the work-style reform, digitalization (including
compliance with the new invoicing system and revision of the Electronic
Books Preservation Act), and the expansion of the mental-health-related
market.
Also, we believe the Company will be able to return to a growth trajectory
again if the cloud business (including the work management system) drives
growth and the new businesses contribute to financial performance. We
expect the Company to return to an upward trend for sales and profit since
IT investments by its corporate customers are expected to remain strong
along with strong business performance, the Company’s upfront
investment costs will most certainly peak out, and the new subscription
businesses are expected to gain momentum over time.
If cost controls are properly conducted, there is a strong possibility that theCompany’s financial results will be greater than the forecasts in the current
fiscal year. Depending on their level, the results may become a positive
surprise. In addition, the Company is expected to increase profit over the
medium term, starting in the next fiscal year, and EPS and dividends are
expected to increase. These suggest an upside potential for the Company’s
stock price.
Going forward, the following will be the key factors to watch due to theirpotential impact on the stock price.
1. Financial results of this fiscal year (full year) and the level of financial
performance in the next fiscal year
2. Performance of the cloud business (changes in PCA Cloud’s numberof corporate users and sales growth rate)
3. Financial performance of the acquired company Dreamhop as well as
Xronos (whose growth is highly anticipated), and the PCA Hub series,
which the Company is currently focused on, regarding its
development, sales situation, and contribution to profit
4. Progress with shifting the on-premises software to subscription
services (PCA Subscription), sales of hyper, progress with the othernew products/services, progress with new business development,
amount of upfront investment, the business’ contribution to profit,and market competition
5. Progress with the medium-term management plan and the profit
growth rate over the medium term
6. Shareholder return measures such as dividend hikes, share buybacks,
and stock splits
7. Progress with the M&A and alliance strategies
8. New tax systems and changes in regulations
9. How its ample cash will be effectively used

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