February 7, 2024

Summary of Consolidated Financial Results
for the Third Quarter Ended December 31, 2023 [Japan GAAP]
Name of Company:
Stock Code:
Stock Exchange Listing:

KAGA ELECTRONICS CO., LTD.
8154
URL: https://www.taxan.co.jp/
Tokyo Stock Exchange, Prime Market
Title: Representative Director,
Representative
Name: Ryoichi Kado
President & COO
Title: Senior Executive Officer
Contact Person
Name: Yasuhiro Ishihara
Head of Administration Headquarters
Phone:+81-(0)3-5657-0111
Date of filing of quarterly securities report (tentative):
February 13, 2024
Date of commencement of dividend payment (tentative):
Quarterly earnings supplementary explanatory documents:
Yes
Quarterly earnings presentation:
None(Yen in millions, rounded down)
1. Financial results for the third quarter of the fiscal year ending March 2024 (April 1, 2023 –December 31, 2023)(1) Result of operations (Consolidated, year-to-date)(Percentage figures represent year on year changes)
Profit attributable
Operating income Ordinary income
to owners ofparentNet sales
Million yen%

Million yen%

Million yen%

Million yen%

Third quarter ended December 2023 406,458(10.1)

20,491(21.2)

20,311(23.7)

15,992(16.1)

Third quarter ended December 2022 452,221

28.2

26,006

77.4

26,61878.8

19,05382.9

Note: Comprehensive income: 3Q of FY3/2024: 20,685 million yen ［(13.5%)］3Q of FY3/2023: 23,925 million yen ［86.0%］

Earnings per
share(diluted)

Earnings per
share
Yen

Yen

Third quarter ended December 2023

608.88－

Third quarter ended December 2022

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

Net assets

Equity ratio

Million yen

Million yen%

As of December 31, 2023

289,657

144,487

49.8

As of March 31, 2023

286,217

129,737

Reference: Shareholdersʼ equity As of December 31, 2023: 144,283 million yen

45.3
As of March 31, 2023: 129,608 million yen

2. Dividends
Dividend per share

1Q

2Q

3Q

Year-end

Full year

Yen

Yen

Yen

Yen

Yen

Fiscal year ended March 2023-

100.00-Fiscal year ended March 2024-

110.00-Fiscal year ending March 2024 (Forecast)120.00220.00110.00220.00Notes: Change in the dividend forecast from the latest announcement: None
Breakdown of interim dividend for FY3/2023: Ordinary dividend: 70.00 yen; Extraordinary dividend: 30.00 yen
Breakdown of year-end dividend for FY3/2023: Ordinary dividend: 70.00 yen; 55th Anniversary commemorative
dividend: 10.00 yen; Extraordinary dividend: 40.00 yen3. Forecast for the fiscal year ending March 2024 (Consolidated, April 1, 2023 – March 31, 2024)

Net sales

Full year

Operating income(Percentage figures represent year on year changes)
Profit attributable
Earnings per
Ordinary income
to owners of
shareparentMillion yen%

Million yen%

Million yen%

550,000(9.5)

25,000(22.5)

25,000(23.6)

Note: Change in the forecast from the latest announcement: None

Million yen%

Yen

18,000 (22.0)

685.42* Notes(1) Changes in significant subsidiaries (Changes in specified subsidiaries accompanied by changes in thescope of consolidation): None
(2) Use of accounting methods specifically for the preparation of the quarterly consolidated financial
statements: None
(3) Changes in accounting policies, estimates, and retrospective restatement(a) Changes due to revision of accounting standards : None(b) Changes other than (a): None(c) Changes in accounting estimates: None(d) Retrospective restatement: None(4) Number of shares outstanding (common stock)(a) Shares outstanding (including treasury shares)
As of December 31, 2023:

28,702,118 As of March 31, 2023:

28,702,118

2,434,276 As of March 31, 2023:

2,440,983(b) Treasury shares
As of December 31, 2023:(c) Average number of shares (quarterly consolidated during the period)
Period ended December 31 2023:

26,265,207 Period ended December 31, 2022: 26,255,971* The quarterly audit procedures by a certified public accountant or auditing firm are not applicable to thisQuarterly Financial Results report.
* Cautionary statement regarding forecasts of operating results and special notes(Caution regarding forward-looking statements)
Forward-looking statements in these materials are based on information available to management at
the time this report was prepared and assumptions that management believes are reasonable. Actual
results may differ significantly from these statements for a number of reasons. For conditions asassumption for earnings forecast and cautionary statement regarding use of the forecast, please see “1.
Results of Operations, (3) Qualitative information on consolidated performance forecast” on page 4.
(How to obtain supplementary materials on quarterly financial results)
Supplementary materials on quarterly financial results are will be posted on TDnet and our website
today (February 7, 2024).

Index for Supplementary Information
1. Results of Operations .......................................................................................................... 2(1) Overview of consolidated business performance............................................................... 2(2) Overview of financial conditions ..................................................................................... 4(3) Qualitative information on consolidated performance forecast............................................ 4
2. Quarterly Consolidated Financial Statements and Major Notes .................................................. 5(1) Quarterly consolidated balance sheet .............................................................................. 5(2) Quarterly consolidated statements of income and comprehensive income ........................... 7
For the third quarter (April 1, 2023 - December 31, 2023) .............................................. 7(3) Notes to quarterly consolidated financial statements ........................................................ 9(Notes to going concern assumptions) .......................................................................... 9(Significant change in shareholdersʼ equity) .................................................................. 9(Segment information) ............................................................................................... 9-1-

1. Results of Operations(1) Overview of consolidated business performance
Looking at the global economy during the third quarter of the consolidated fiscal period underreview, uncertainties remained in the economic outlook including the impact of monetary
tightening in the U.S. and Europe, economic stagnation in China, and heightening geopolitical risks
arising from the prolonged situation in Ukraine and aggravation of the Middle East situation. In
Japan, although rising prices put a downward pressure on the economy, modest recovery
continued, supported notably by a rebound of personal consumption against the backdrop of
improvement in income situation, and an increase in inbound tourist demand.
In the electronics industry to which the Group belongs, whereas demand in the automotive
market continued to grow along with easing of supply shortages of semiconductors and electronic
components, on the back of vehicle electrification and other trends, demand in the industrial
equipment and other markets remained in an adjustment phase.
Under such a management environment, during the third quarter of the consolidated fiscal year
under review, although net sales increased in the information equipment business and the others
business, the electronic components business was affected by such factors as disappearance of
spot demand given easing of supply shortages of semiconductors and electronic components,
diminution of transactions with a certain client of an overseas subsidiary of Excel Co., Ltd., andmore recently, full-scale inventory adjustments conducted by customers in general. As a result, net
sales decreased by 10.1% year on year to 406,458 million yen.
Operating income decreased by 21.2% year on year to 20,491 million yen, reflecting efforts to
reduce selling, general and administrative expenses in the face of a decline in gross profit due tolower net sales. Ordinary income decreased by 23.7% year on year to 20,311 million yen, due inpart to posting of foreign exchange losses as non-operating expenses.
Profit attributable to owners of parent decreased by 16.1% year on year to 15,992 million yen,reflecting in part posting of extraordinary income that included 1,355 million yen in gain on sales ofinvestment securities and 481 million yen in gain on bargain purchase associated with a corporate
acquisition.
FY 2023/3 3Q(April 1, 2022 –December 31, 2022)

FY 2024/3 3Q(April 1, 2023 –December 31, 2023)

YoY（Million yen）

（Million yen）

（Million yen）

Net sales

452,221406,458(45,763)(10.1％)

Gross profit

59,88452,252(7,632)(12.7%)（Margin）

13.2％

12.9％

(0.3pt)－SG&A

33,87731,760(2,117)(6.2%)

Operating income

26,006

20,491(5,515)(21.2%)

Ordinary income

26,61820,311(6,306)(23.7%)

Profit before income taxes

27,134

22,385(4,748)(17.5%)

19,053

15,992(3,060)(16.1%)

136.51Yen

143.29Yen

6.78Yen－Profit attributable to ownersof parent
Exchange Rate
(Average rate during the year)
USD

-2-

Business segment performance was as follows.
(a) Electronic components (Development, manufacture and sale of semiconductors, general electronic
components and other products, the electronics manufacturing service (EMS*¹), and other activities)
In this business, the components sales business faced sluggish sales of semiconductors andelectronic components in general. Although SoC*² products by Kaga FEI Co., Ltd. continued toenjoy robust sales, the business was affected notably by disappearance of spot demand given
easing of supply shortages of semiconductors and electronic components that had continued fortwo consecutive years until the previous fiscal year, diminution of transactions with a certain clientof an overseas subsidiary of Excel Co., Ltd., and more recently, inventory adjustments conducted
on a full-scale.
In the EMS business, sales in the automotive sector increased due to improved supply anddemand balance of semiconductors and electronic components, whereas sales in applications
related to medical and industrial equipment decreased due partly to inventory adjustments at key
customers.
As a result, net sales decreased by 11.8% year on year to 357,794 million yen, and segment
income decreased by 26.5% year on year to 17,148 million yen.
Note: 1. Electronics Manufacturing Service: Provision of product development and manufacturing services on an
outsourcing basis.
2. Abbreviation for System on a Chip. A design technique of integrating all the functions necessary for
operation of a device or system on a single semiconductor chip.

(b) Information Equipment (Sales of PCs, PC peripherals, home electric appliances, photograph andimaging products, original brand products, and other products)
In this business, robust sales were maintained with continued strong sales of PCs foreducational institutions and security software, although sales of PCs for mass retailers struggled
due to weak demand. In the LED installation business, sales of large-scale projects that theGroup started pushing forward on a full scale in the previous fiscal year contributed.
As a result, net sales increased by 3.9% year on year to 30,266 million yen, and segment
income increased by 28.1% year on year to 1,921 million yen.
(c) Software (Production of computer graphics, planning and development of amusement products,
and other activities)
In this business, orders for computer graphics production remained solid. Net sales decreasedby 12.5% year on year to 1,816 million yen while segment income increased by 94.1% year on
year to 262 million yen, attributable partly to the effect of containing cost of sales through efforts
in operational efficiency improvement.
(d) Others (Repair and support for electronics equipment, and sales of amusement equipment andsports goods, and others)
In this business, the PC and PC peripheral recycling business remained strong, and so did salesof amusement equipment and sporting goods. Net sales increased by 7.7% year on year to
16,581 million yen, and segment income increased by 9.0% year on year to 1,059 million yen.
< Financial Results by Business Segment >FY 2023/3 3Q(April 1, 2022 –December 31, 2022)

YoY（Million yen）

（Million yen）

357,794
17,148(47,814)(11.8％)(6,193)(26.5％)

30,266
1,921

1,126
421

3.9％
28.1％

1,816
262

(259)
127

(12.5％)
94.1％

16,581
1,059

1,183
87

7.7％
9.0％

406,458
20,491(45,763)(5,515)(10.1％)(21.2％)Net sales

405,608

Components

Segment income

23,341

Information

Net sales

29,139Equipment

Segment income

1,499

Software

Net sales

2,076

Segment income

135

Net sales

15,397

Segment income
Total(April 1, 2023 –December 31, 2023)（Million yen）

Electronic

Others

FY 2024/3 3Q

971

Net sales

452,221

Segment income

26,006

Note: “Segment income” shows unadjusted figures for each business segment and adjusted figures for the total.

-3-(2) Overview of financial conditions
Assets, liabilities and net assets
Total assets as of December 31, 2023, increased by 3,440 million yen from March 31, 2023, to289,657 million yen.
Current assets increased by 4,272 million yen from March 31, 2022, to 249,844 million yen. Thiswas primarily due to a 10,905 million yen increase in cash and deposits and a 10,280 million yen
increase in inventories, along with a 20,567 million yen decrease in trade receivables including
accounts receivable – trade.
Non-current assets decreased by 831 million yen from March 31, 2022, to 39,813 million yen.
Liabilities decreased by 11,309 million yen from March 31, 2022, to 145,170 million yen. This is
primarily due to a 4,592 million yen decrease in income taxes payable and a 3,625 million yen decreasein notes and accounts payable – trade.
Net assets increased by 14,750 million yen from March 31, 2023, to 144,487 million yen. This is
primarily due to an increase of 15,992 million yen in profit attributable to owners of parent.
(3) Qualitative information on consolidated performance forecast
Performance in the first nine months of the consolidated fiscal year under review continued tomake steady progress and exceeded the internal plan. However, no revision is made to the full-year
earnings forecasts announced on May 11, 2023, as the future is difficult to predict in the face of suchcurrent situation as expansion of inventory adjustments by customers in general as well as the 2024
Noto Peninsula Earthquake that occurred at the beginning of the year and its impact on the supply
chain, in addition to changes in the macro environment that have confronted us, including
geopolitical risks arising notably from the prolonged situation in Ukraine and the Middle East,
concerns of an economic slowdown in Japan and globally, and drastic exchange rate fluctuations.
In line with the growth strategy formulated in the Medium-Term Management Plan 2024, theGroup will seek to achieve further growth and reinforce profit structure, and work on improving its
corporate value.
Reference: Earning Forecasts for FY2024/3 and Management Targets of Medium-Term Management Plan 2024
FY2024/3
Forecasts

FY2024/3
3Q Results(Announced on May 11, 2023)

Progress rate

Management Targetsof Medium-Term
Management Plan 2024
(FY2025/3)

73.9%

750 billion yen(Million yen)

(Million yen)

Net Sales

406,458

550,000

Operating Income

20,491

25,00082.0%

30 billion yen or higher

Ordinary Income

20,311

25,00081.2%－

Profit attributable toowners of parent

15,99218,000

88.8%

－

－

13.3％

－

Stable 10% or higher

ＲＯＥ

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

-4-2. Quarterly Consolidated Financial Statements and Major Notes(1) Quarterly consolidated balance sheet(Million yen)
Fiscal year ended

Third quarter ended

March 2023

December 2023

(As of March 31, 2023) (As of December 31, 2023)
ASSETS
Current assets
Cash and deposits
Notes receivable – trade
Electronically recorded monetary claims – operating
Accounts receivable – trade
Securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Non-current assets

52,60063,506

1,534

1,151

9,683

11,188117,881

96,192

195

193

41,37548,897

2,277

2,181

12,552

15,406

7,624

11,292

(153)

(165)

245,572

249,844

6,690

7,220

6,466

7,142

1,103

1,195

5,859

6,055

39

1,717

20,15823,331

48

24

2,617

2,178

36

51

2,702

2,254

12,144

10,186

2,162

855

1,280

1,159

Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
Tools, furniture and fixtures, net
LandConstruction in progress
Total property, plant and equipment
Intangible assets
Goodwill
Software
Other
Total intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Guarantee deposits
Insurance funds
Distressed receivables
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

-5-

920

873

4,842

5,024

1,298

1,211

(4,864)(5,083)

17,784

14,22740,64539,813286,217289,657(Million yen)
Fiscal year ended

Third quarter ended

March 2023

December 2023

(As of March 31, 2023) (As of December 31, 2023)
LIABILITIESCurrent liabilities
Notes and accounts payable - trade79,23275,607

Short-term loans payable

19,58520,204

Accrued expenses

8,400

6,921

Income taxes payable

6,011

1,418

Provision for directors’ bonuses

465

12

Other

13,852

10,084

Total current liabilities

127,547

114,250

Bonds payable

10,00010,000Long-term loans payable

10,60010,600

Deferred tax liabilities

2,634

3,617

Non-current liabilities

Provision for directors’ retirement benefits

143

146

Net defined benefit liability

2,148

2,304

Asset retirement obligations

627

657

Other

2,778

3,593

Total non-current liabilities

28,93230,919156,479

145,170

Capital stock

12,133

12,133

Capital surplus

14,82014,849Retained earnings

95,945

105,897

Treasury shares(5,614)(5,601)

Total shareholders’ equity

Total liabilities
NET ASSETS
Shareholders’ equity

117,285

127,278

Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges

2,534

2,579

(18)

(19)

Foreign currency translation adjustment

9,568

14,213Remeasurements of defined benefit plans

239

231

12,322

17,004129

204

129,737

144,487

286,217289,657

Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets-6-

(2) Quarterly consolidated statements of income and comprehensive income
For the third quarter (April 1, 2023 – December 31, 2023)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividends income
Commission fee
Share of profit of entities accounted forusing equity method
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses

Third quarter ended
December 2022
(April 1, 2022 –December 31, 2022)
452,221392,337
59,88433,87726,006

Share of loss of entities accounted for using
equity method
Foreign exchange losses
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Gain on revision of retirement benefit plan
Gain on bargain purchase
Gain on liquidation of subsidiaries andassociates
Other
Total extraordinary income
Extraordinary loss
Impairment loss
Loss on retirement of non-current assets
Loss on valuation of investment securities
Other
Total extraordinary loss
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit attributable to owners of parent
Profit attributable to non-controlling interests-7-(Million yen)
Third quarter ended
December 2023
(April 1, 2023 –December 31, 2023)
406,458354,206
52,252
31,76020,491

143
214
166

606
241
113

58

－

375
312
1,270

－
552
1,513

494

669

－

33

－
164
659
26,618

686
304
1,693
20,311

14
626
126
－

15
1,355
－
481

－

480

1
768

2
2,334

30
31
187
1
251
27,134
7,264
802
8,066
19,067

16
3
233
5
259
22,385
3,898
2,489
6,388
15,997

19,053

15,99214

5

Other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges(Million yen)
Third quarter ended
December 2023
(April 1, 2023 –December 31, 2023)

Third quarter ended
December 2022
(April 1, 2022 –December 31, 2022)
390

Foreign currency translation adjustment
Remeasurements of defined benefit plans,
net of tax
Share of other comprehensive income ofassociates accounted for using equity
methodTotal other comprehensive income
Comprehensive income
Comprehensive income attributable toowners of parent
Comprehensive income attributable tonon-controlling interests

-8-

41

(116)

(0)

4,516

4,542

(137)

(8)

205

111

4,857

4,687

23,925

20,68523,907

20,67418

10

(3) Notes to quarterly consolidated financial statements(Notes to going concern assumptions)Not applicable(Significant change in shareholders’ equity)
Not applicable(Segment information)
I. For the third quarter ended December 2022 (April 1, 2022 – December 31, 2022)
Information about net sales and income (loss) by reportable segments
Reportable segments
Electronic

Information

Components Equipment

Software

Others

Total(Million yen)
Adjustment

Consolidated(Note 1)

(Note 2)

Net sales:
Sales to external

405,608

29,1392,076

15,397452,221－452,221

2,684

5,323

697

5,877

14,582(14,582)－

Total

408,293

34,462

2,773

21,274

466,803(14,582)452,221

Segment income

23,341

1,499

135

971

25,94857

26,006customers
Inter-segment
sales ortransfers

Notes:

1. Adjustment in segment income of 57 million yen includes 57 million yen for elimination of inter-segment trade.
2. Segment income is adjusted for operating income on the quarterly consolidated statements of income andcomprehensive income.

II. For the third quarter ended December 2023 (April 1, 2023 – December 31, 2023)
Information about net sales and income (loss) by reportable segments
Reportable segments
Electronic

Information

Components Equipment

Software

Others

Total(Million yen)
Adjustment

Consolidated(Note 1)

(Note 2)

Net sales:
Sales to external

357,794

30,266

1,816

16,581

406,458－

406,458

2,755

7,181

1,109

4,245

15,291(15,291)－

Total

360,549

37,4482,926

20,826

421,749(15,291)

406,458

Segment income

17,148

1,921

262

1,059

20,392

99

20,491

customers
Inter-segment
sales ortransfers

Notes:

1. Adjustment in segment income of 99 million yen includes 99 million yen for elimination of inter-segment trade.
2. Segment income is adjusted for operating income on the quarterly consolidated statements of income andcomprehensive income.

-9-