Consolidated Financial Results
for the Three Months Ended June 30, 2022
[Japanese GAAP]
August 4, 2022
Company name: A&D HOLON Holdings Company, Limited
Stock exchange listing: Tokyo Stock Exchange
Code number: 7745
URL: https://andholon.com/
Representative: Yasunobu Morishima, President & CEO
Contact: Sadao Ito, Director, Managing Executive Officer in charge of Business Management HQ
Phone: +81-48-593-1590
Scheduled date of filing quarterly securities report: August 10, 2022
Scheduled date of commencing dividend payments: Availability of supplementary briefing material on quarterly financial results: Available
Schedule of quarterly financial results briefing session: Not scheduled(Amounts of less than one million yen are truncated.)
1. Consolidated Financial Results for the Three Months Ended June 30, 2022 (April 1, 2022 to June 30, 2022)(1) Consolidated Operating Results(% indicates changes from the previous corresponding period.)
Net profit
attributable to
Net sales
Operating profit
Ordinary profit
parent company
shareholders% Million yen% Million yen%
Three months ended Million yen% Million yen
June 30, 2022
11,981
3.8
(219)
(1)
(159)
June 30, 2021
11,541
17.8
847
292.3
956
244.9
570
584.0
Note: Comprehensive income Three months ended June 30, 2022: ¥4,354 million [419.6%]
Three months ended June 30, 2021: ¥837 million [42.8%]
Three months ended
June 30, 2022
June 30, 2021

Basic earnings per
share

Diluted earnings per
share(5.83)
27.64

27.58

Yen

Yen

(2) Consolidated Financial Position
Total assets

Net assets

Million yen

As of June 30, 2022
64,530
As of March 31, 2022
59,239Reference: Equity As of June 30, 2022: ¥30,931 million
As of March 31, 2022: ¥24,155 million

Million yen

Equity ratio

31,062
27,041

%

47.9
40.8

2. Dividends
1stquarter-end
Fiscal year ended March 31, 2022
Fiscal year ending March 31, 2023

Yen-

Annual dividends
2nd
3rd
quarter-end
quarter-end
Yen

10.00

Yen

Year-end
Yen

Total
Yen

-

15.00

25.00

-

15.00

30.00

-

Fiscal year ending March 31, 2023
15.00
(Forecast)
Note: Revision to the forecast for dividends announced most recently: No

3. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2023 (April 1, 2022 to March
31, 2023)(% indicates changes from the previous corresponding period, or corresponding quarter of previous year.)
Operating profit

Net sales
Millionyen%

Millionyen

Ordinary profit%

Millionyen%

2nd quarter
24,300
1.8
1,980
(7.2)
1,920
(14.1)(cumulative)
Full period
53,800
4.0
6,000
9.2
5,870
4.7
Note: Revision to the financial results forecast announced most recently: No

Net profit
attributableto parent company
shareholders

Basicearnings
per share

Million yen

%

Yen

1,300

(4.7)

47.40

3,990

11.6

145.48* Notes:(1) Changes in significant subsidiaries during the period under review: No(Changes in specified subsidiaries accompanying changes to the scope of consolidation)
New: - companies (Company name) - ; Excluded: - companies (Company name) (2) Accounting policies adopted specially for the preparation of quarterly consolidated financial statements: Yes(3) Changes in accounting policies, changes in accounting estimates and retrospective restatement
1) Changes in accounting policies due to the revision of accounting standards: Yes
2) Changes in accounting policies other than 1) above: No
3) Changes in accounting estimates: No4) Retrospective restatement: No
Note: For details, please refer to "2. Quarterly Consolidated Financial Statements and Primary Notes, (3) Notes to
Quarterly Consolidated Financial Statements, (Changes in Accounting Policies)" on page 8 of the
Appendix.
(4) Total number of issued shares (common stock)1) Total number of issued shares at the end of the period (including treasury stock):
June 30, 2022: 27,845,208 shares
March 31, 2022: 22,601,400 shares2) Total number of treasury stock at the end of the period:
June 30, 2022: 419,727 shares
March 31, 2022: 1,919,070 shares
3) Average number of shares during the period:
Three months ended June 30, 2022: 27,425,731 shares
Three months ended June 30, 2021: 20,628,230 shares
Note: The total number of treasury stock at the end of the period and the total number of treasury stock which has
been eliminated when calculating the average number of shares during the period include the Company’s
shares held by Custody Bank of Japan, Ltd. (Trust E Account) as trust properties of the stock benefit trust
system.
* These consolidated financial results are outside the scope of quarterly review by certified public accountants or audit
corporations.
* Explanation of the proper use of financial results forecasts and other notes
Forward-looking statements in this document, including financial results forecasts, are based on information
available and certain assumptions deemed reasonable by the Company at present, and the Company does notguarantee their achievement. Actual business results, etc., may differ significantly due to various factors.

Table of Contents
1. Qualitative Information on Quarterly Financial Results for the Period ........................................................... 2(1) Business Results ........................................................................................................................................... 2(2) Financial Position ......................................................................................................................................... 3(3) Consolidated Financial Results Forecast and Other Forward-looking Information ..................................... 3
2. Quarterly Consolidated Financial Statements and Primary Notes ................................................................... 4(1) Quarterly Consolidated Balance Sheets ....................................................................................................... 4(2) Quarterly Consolidated Statements of Income and Comprehensive Income ............................................... 6
Quarterly Consolidated Statements of Income
Three Months Ended June 30 .................................................................................................................. 6
Quarterly Consolidated Statements of Comprehensive Income
Three Months Ended June 30 .................................................................................................................. 7(3) Notes to Quarterly Consolidated Financial Statements ................................................................................ 8(Notes on going concern assumption) .......................................................................................................... 8(Notes in the case of significant changes in shareholders’ equity) .............................................................. 8(Changes in accounting policies) ................................................................................................................. 8(Accounting policies adopted specially for the preparation of quarterly consolidated financial statements) .. 8
(Additional information) ..................................................................................................................................... 8(Segment information, etc.).......................................................................................................................... 9(Business combinations) ............................................................................................................................ 11(Significant subsequent events).................................................................................................................. 141

1. Qualitative Information on Quarterly Financial Results for the Period(1) Business Results
During the three months ended June 30, 2022, the Japanese economy continued to show signs of gradual rally
against the backdrop of the easing of various restrictions imposed on people’s activities as the COVID-19
pandemic settles down and the steady recovery of the global economy centered on the U.S. and European
countries. However, the outlook remains uncertain due to such factors as rebound of infectious diseases due tothe new variant, global supply shortages and price increases of semiconductors and other components, spikes inmaterial prices resulting from lingering Russia-Ukraine crisis, disrupted and sluggish economic activity due toChina’s zero-Covid policy, in addition to the concerns about a slowdown in business recovery due to inflationarypressure, etc.
Amid such circumstances, A&D HOLON Holdings Company, Limited (the “Company”), and its subsidiaries(collectively, the “Group”) started a new group formation on April 1 this year and has set up several
subcommittees and started activities to maximize the effects of the reorganization. In addition, we have sought
to differentiate ourselves from our competitors by responding to the diverse and changing needs of clients andsociety through ongoing, active investment.
In the Group, the measurement and weighing instruments business remained steady against the backdrop of
the recovery of the global economy. In the medical and healthcare business, yen-translated net sales increased
partly due to the impact of the weaker yen, although there were signs of a decline in consumer purchasing appetite
due to concerns about global inflation, especially in the U.S. In addition, the semiconductor-related business, towhich a segment was added due to the group reorganization, posted lower sales and profits due to delays in export
flights. As a result, although sales increased compared to the same period of the previous year, the sharp
depreciation of the yen caused an increase in the cost of sales associated with the elimination of unrealized gains
on inventories, which pushed down profit significantly.
As a result, net sales for the three months ended June 30, 2022 were ¥11,981 million (up 3.8% year-on-year),
operating loss was ¥219 million (operating profit of ¥847 million for the same period of the previous year),ordinary loss was ¥1 million (ordinary profit of ¥956 million for the same period of the previous year), and net
loss attributable to parent company shareholders was ¥159 million (net profit attributable to parent company
shareholders of ¥570 million for the same period of the previous year)
Business results by segment are as follows.
From the first quarter of the fiscal year ending March 31, 2023, the reportable segments have been changed,
and comparisons and analyzes shown for the three months ended June 30, 2022 are reclassified reportablesegments.
1) Measurement and Weighing Instruments Business
In Japan, sales decreased due to some delays in a large-scale project, but loss decreased as a result ofefforts to reduce costs and improve production efficiency.
In the Americas, both sales and profit increased, driven by the progress in the production of measurement
and control simulation systems (DSP systems) which we received orders in the previous fiscal year, in addition
to the continued popularity of mainstay weighing instruments.
In Europe, both sales and profit increased, driven by the effort for expanding market share of weighing
instruments.
In Asia and Oceania, both sales and profit increased, driven by the significant growth in sales of weighing
instruments in South Korea and metal detectors and checkweighers in India, in addition to the recovery indemand for other products and in other regions.
As a result, net sales in the measurement and weighing instruments business were ¥5,653 million (up 5.3%
year-on-year) and operating profit was ¥272 million (up 1,774.9% year-on-year).
22) Semiconductor-Related BusinessIn the semiconductor-related business, which was separated from the measurement and weighing
instruments business due to the group reorganization, the backlog of orders has increased significantly, andthe number of inquiries is also active, indicating the strong performance of the semiconductor inspection
equipment market, although both sales and profit decreased due to delays in air shipment for export products.
As a result, net sales in the semiconductor-related business were ¥1,186 million (down 4.8% year-on-year)
and operating profit was ¥322 million (down 20.8% year-on-year).
3) Medical and Healthcare Business
In Japan, demand for home-use blood pressure monitors remained strong, and sales of medical equipment
remained steady, leading to increases in both sales and profits.
In the Americas, although a large-scale project continued in the U.S., consumer awareness changed due toconcerns about inflation, and sales on a local currency basis fell below the results for the same period of theprevious fiscal year. Profit also decreased due to the impact of soaring transportation costs to the U.S.,
including air shipment.
In Europe, although sales decreased in Russia due to the impact of the Russia-Ukraine crisis, profit
remained at the same level as the same period of the previous year due to efforts to control expenses.
As a result, net sales in the medical and healthcare business were ¥5,141 million (up 4.4% year-on-year)
and operating profit was ¥792 million (up 10.0% year-on-year).

(2) Financial Position(Assets, liabilities and net assets)
Total assets as of June 30, 2022 were ¥64,530 million, an increase of ¥5,291 million compared to the end of
the previous fiscal year. This was mainly due to an increase in current assets of ¥4,747 million due to an increase
in inventories due to the effect of the depreciation of the yen and the effects of longer transportation period causedby supply chain disruptions.
Total liabilities as of June 30, 2022 were ¥33,468 million, an increase of ¥1,269 million compared to the endof the previous fiscal year. This was primarily due to an increase of ¥1,609 million in current liabilities resulting
from increases of short-term borrowings.
Net assets as of June 30, 2022 were ¥31,062 million, an increase of ¥4,021 million compared to the end of theprevious fiscal year. This was driven by an increase of ¥4,500 million in accumulated other comprehensive
income which is due to changes in foreign currency translation adjustments as well as an increase of ¥2,274
million in shareholders’ equity and a decrease of ¥2,753 million on non-controlling interests due to the
management integration implemented on April 1, 2022.
(3) Consolidated Financial Results Forecast and Other Forward-looking Information
There are no changes from the consolidated financial results forecast announced on May 12, 2022.

3

2. Quarterly Consolidated Financial Statements and Primary Notes(1) Quarterly Consolidated Balance Sheets(Million yen)
As of March 31, 2022
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable and contract assets
Products
Unfinished goods
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Fixed assets
Tangible fixed assets
Land
Other, net
Total tangible fixed assets
Intangible fixed assets
Goodwill
Other
Total intangible fixed assets
Investments, etc.
Total fixed assets
Total assets
Liabilities
Current liabilities
Notes and accounts payable
Short-term borrowings
Long-term borrowings to be repaid within one year
Accrued corporate taxes, etc.
Provision for bonuses
Provision for product warranties
Other
Total current liabilities
Fixed liabilities
Corporate bonds
Long-term borrowings
Provision for product warranties
Retirement benefit liabilities
Provision for share-based remuneration for directors(and other officers)
Other
Total fixed liabilities
Total liabilities

4

As of June 30, 2022

11,882
14,114
7,337
4,019
5,225
1,440
(73)
43,946

13,71812,763
9,957
4,690
5,855
1,814
(105)
48,694

5,073
6,308
11,382

5,116
6,518
11,634

123
1,353
1,476
2,433
15,292
59,239

102
1,449
1,552
2,649
15,83664,5305,141
12,029
2,543
759
1,260
183
4,285
26,202

5,619
13,589
2,323
362
788
193
4,933
27,811

500
3,813
49
1,034

500
3,333
87
1,060

83

88

514
5,995
32,198586
5,656
33,468(Million yen)
As of March 31, 2022
Net assets
Shareholders’ equity
Share capital
Share capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Unrealized gains on other marketable securities
Foreign currency translation adjustments
Accumulated adjustment on retirement benefits
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

5

As of June 30, 2022

6,388
6,413
14,367(1,044)
26,125

6,388
8,318
13,873(181)
28,40026(2,278)282(1,969)2,885
27,041
59,239

22
2,249
259
2,531
131
31,06264,530(2) Quarterly Consolidated Statements of Income and Comprehensive Income
Quarterly Consolidated Statements of Income
Three Months Ended June 30(Million yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit (loss)
Non-operating income
Interest income
Foreign exchange gains
Subsidy income
Rental income from land and buildings
Other
Total non-operating income
Non-operating expenses
Interest expenses
Settlement package
Other
Total non-operating expenses
Ordinary profit (loss)
Extraordinary income
Gain on sales of fixed assets
Total extraordinary income
Extraordinary loss
Loss on sales of fixed assets
Loss on retirement of fixed assets
Loss on valuation of investment securities
Total extraordinary loss
Net profit (loss) before taxes
Corporate tax, resident income tax and business taxes
Corporate tax adjustments
Total corporate taxes
Profit (loss)
Net profit (loss) attributable to non-controlling interests
Net profit (loss) attributable to parent company shareholders

6

For the three months
ended June 30, 2021
11,541
6,329
5,211
4,364
847

For the three months
ended June 30, 2022
11,981
7,604
4,376
4,596
(219)

13
27
116
9
27
195

48
171
－
12
42
274

33
44
7
85
956

44
－
11
55
(1)

1
1

0
0

0
0
－
0
957
240
17
258
698
128
570

0
0
4
5
(6)
205
(57)
147
(153)
6
(159)

Quarterly Consolidated Statements of Comprehensive Income

Three months ended June 30(Million yen)

Profit (loss)
Other comprehensive income
Unrealized gains on other marketable securities
Foreign currency translation adjustments
Adjustment related to retirement benefits
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to parent company shareholders
Comprehensive income attributable to non-controlling interests

7

For the three months
ended June 30, 2021
698

For the three months
ended June 30, 2022
(153)

0
163
(24)
139
837

(4)
4,535
(23)
4,507
4,354

707
130

4,340
13

(3) Notes to Quarterly Consolidated Financial Statements(Notes on going concern assumption)
Not applicable.
(Notes in the case of significant changes in shareholders’ equity)
The Share Exchange was conducted through a share exchange in which the Company is the whollyowning parent company resulting from the share exchange and HOLON Co., Ltd. is the wholly-owned
subsidiary resulting from the share exchange, effective April 1, 2022. As a result, share capital surplus
increased ¥1,905 million and treasury shares decreased ¥862 million.
(Changes in accounting policies)(Application of the Accounting Standards Codification “Leases” Topic 842)
Our consolidated subsidiaries that have adopted U.S. GAAP have applied the Accounting Standards
Codification “Leases” Topic 842 (hereinafter the “ASC Topic 842”) from the beginning of the first quarterof the fiscal year ending March 31, 2023. Accordingly, the subsidiaries recognize all lease transactions by
the lessee as assets and liabilities on the consolidated balance sheet, in principle. In applying the ASC Topic
842, we have adopted the method of recognizing the cumulative effect of the application of the accounting
standard, which is permitted as the transitional treatment, on the date of initial application.
With the application of the accounting standard, at the beginning of the first quarter of the fiscal year
ending March 31, 2023, “other (net)” under tangible fixed assets increased ¥65 million, “other” undercurrent liabilities increased ¥12 million, and “other” under fixed liabilities increased ¥53 million. The
impact of the application of the accounting standard on quarterly consolidated statements of income isimmaterial for the three months ended June 30, 2022.
(Accounting policies adopted specially for the preparation of quarterly consolidated financial statements)
For the three months ended June 30, 2022
Calculation of tax
expensesTax expenses for certain consolidated subsidiaries are calculated by reasonably
estimating the effective tax rate after tax effect accounting to be applied to profit before
taxes for the fiscal year, which includes the first quarter, and multiplying profit before
taxes by the estimated effective tax rate.

(Additional information)
Effective from the first quarter of the fiscal year ending March 31, 2023, the Company and its consolidated
subsidiaries in Japan have transitioned from the consolidated taxation system to the group tax sharing
system. In accordance with this change, the Company has applied the “Practical Solution on the Accounting
and Disclosure Under the Group Tax Sharing System” (PITF No. 42, August 12, 2021. hereinafter “PITF
No. 42”) regarding accounting treatment and disclosure of corporate and local income taxes and tax effectaccounting in the case where a group tax sharing system is applied. In accordance with Paragraph 32 (1) of
PITF No. 42, the Company has deemed that there is no impact from the change in accounting policy upon
the application of PITF No. 42.

8

(Segment information, etc.)[Segment information]
I. For the three months ended June 30, 2021
1. Information on net sales and profit (loss) by reportable segment(Million yen)
Measurement and Weighing Instruments BusinessJapan

Americas

EuropeAsia and
Oceania

Net sales
Net sales to outside
customers
Inter-segment net sales andtransfers

3,307

822

212

1,027

5,369

587

52

－

606

1,247

Total

3,894

875

212

1,634

6,616

(184)

81

(0)

117

14

Segment profit (loss)

Total

Semiconductor-Related BusinessJapan

Americas

EuropeAsia and
Oceania

Total

Net sales
Net sales to outside
customers
Inter-segment net sales andtransfers

1,245

－

－

－

1,245

－

－

－

－

－

Total

1,245

－

－

－

1,245

407

－

－

－

407

Segment profit (loss)

Medical and Healthcare BusinessJapan

Americas

EuropeAsia and
Oceania

Total

Adjustment Consolidation(Note 1)
(Note 2)

Net sales
Net sales to outside
customers
Inter-segment net sales andtransfers

1,254

1,817

1,687

166

4,925

－

11,541

1,877

3

4

1,538

3,423

(4,670)

－

Total

3,131

1,820

1,691

1,705

8,349

(4,670)

11,541

535

45

130

8

720

(294)

847

Segment profit (loss)

Note: 1. The adjustment of ¥ (294) million in segment profit (loss) includes corporate expenses of ¥ (407) million
not allocated to any segments. Corporate expenses are primarily general and administrative expenses for
management departments.
2. Segment profit (loss) have been adjusted with operating profit on the quarterly consolidated statements
of income.

2. Information on impairment loss or goodwill, etc., for fixed assets by reportable segment
Not applicable9II. For the three months ended June 30, 2022
1. Information on net sales and profit (loss) by reportable segment(Million yen)
Measurement and Weighing Instruments BusinessJapan

Americas

EuropeAsia and
Oceania

Net sales
Net sales to outside
customers
Inter-segment net sales andtransfers

3,069

1,171

230

1,181

5,653

1,029

18

0

917

1,965

Total

4,099

1,189

231

2,098

7,619

(15)

102

10

175

272

Segment profit (loss)

Total

Semiconductor-Related BusinessJapan

Americas

EuropeAsia and
Oceania

Total

Net sales
Net sales to outside
customers
Inter-segment net sales andtransfers

1,186

－

－

－

1,186

－

－

－

－

－

Total

1,186

－

－

－

1,186

322

－

－

－

322

Segment profit (loss)

Medical and Healthcare BusinessJapan

Americas

EuropeAsia and
Oceania

Total

Adjustment Consolidation(Note 1)
(Note 2)

Net sales
Net sales to outside
customers
Inter-segment net sales andtransfers

1,490

1,993

1,524

132

5,141

－

11,981

2,596

0

0

2,322

4,920

(6,885)

－

Total

4,087

1,993

1,524

2,455

10,061(6,885)

11,981

652

(116)

131

124

792

(1,607)(219)

Segment profit (loss)

Note: 1. The adjustment of ¥ (1,607) million in segment profit (loss) includes corporate expenses of ¥ (456) million
not allocated to any segments and ¥ (1,027) million of elimination of unrealized gains on inventories.
Corporate expenses are primarily general and administrative expenses for management
departments.
2. Segment profit (loss) have been adjusted with operating loss on the quarterly consolidated statements ofincome.

10

2. Disclosure of changes, etc. in reportable segments
From the first quarter of the fiscal year ending March 31, 2023, the semiconductor-related business thatwas included in the measurement and weighing instruments business was separated due to the group
restructuring on April 1, 2022. The reportable segments have been changed from the previous "measurement
and weighing instruments business" and "medical and healthcare business" to "measurement and weighing
instruments business", "medical and healthcare business" and "semiconductor-related business".
In this regard, segment information for the previous consolidated fiscal year are the information preparedbased on the reclassified reportable segments.
3. Information on impairment loss or goodwill, etc., for fixed assets by reportable segment
Not applicable.
(Business Combinations)(Share exchange between the Company and HOLON Co., Ltd. and transition to holding company structure)
Upon approval at extraordinary shareholders meetings of the respective companies, the Company and
HOLON Co., Ltd. (“HOLON”) conducted a share exchange (the “Share Exchange”) as of April 1, 2022. At
the same time, to ensure the transition of the Group into a holding company structure, a company split (the“Absorption-Type Company Split”), in which the Company was the splitting company and A&D Company,
Limited((formerly known as A&D Split Preparatory Company, Limited) the “New A&D”) was the
succeeding company, was conducted (the “Management Integration,” referring to this entire procedure).
1. Purpose of Management Integration
The Management Integration is aimed at making it possible resolve tasks to be addressed by aligning thedirection of the group more than before and creating a structure that can rapidly respond to the changing
business environment while utilizing the strengths of the Company and HOLON. Specifically, by creating aholding company structure through the Management Integration, the companies will endeavor to strengthen
the group strategy function, effectively use group management resources, and maximize value forstakeholders. Additionally, the Company and HOLON, which entered into a parent-subsidiary relationshipin 2018 and have mainly interacted in regard to technical matters, believe the Management Integration willlead to the achievement of synergies in such areas as purchase functions, production equipment and greateruse of overseas operations, not just in technical matters, such as joint research and development.
2. Outline of Share Exchange(1) Legal form of Share Exchange
The Share Exchange was conducted through a share exchange in which the Company is the whollyowning parent company resulting from the share exchange and HOLON is the wholly-owned subsidiary
resulting from the share exchange.

11(2) Share Exchange Ratio
Company(wholly-owning parent company
resulting from share exchange)

HOLON(wholly-owned subsidiary resulting
from share exchange)

1

3.60

Share Exchange Ratio

Note: A total of 6,743,808 common shares in the Company were delivered through the Share Exchange.
The Company allocated part of the treasury shares it holds. The breakdown of the allotment is asfollows:
1) Number of common shares newly issued: 5,243,808
2) Number of treasury shares allocated: 1,500,000(3) Basis for Share Exchange Ratio
In deciding the share exchange ratio, the Company and HOLON selected Plutus Consulting Co., Ltd.
(“Plutus”) and Yamada Consulting Group Co., Ltd. (Yamada Consulting) as their respective financial
advisors.
Plutus performed the calculation using market price analysis because the Company’s and HOLON’s
common shares are both listed on financial instruments exchanges and therefore have market prices,
discounted cash flow analysis (“DCF Analysis“) in order to reflect future business activities in thevaluation, and comparable company analysis because it is possible to infer the share value throughcomparison to similar companies as there are listed companies that are comparable to the Companies.
Plutus took the outcomes of these analyses from comprehensive angles in calculating the shareexchange ratio.
Yamada Consulting performed the calculation by using the market price analysis because thecompanies are listed on financial instrument exchanges and therefore have market prices, DCF Analysis
in order to reflect future business activities in the valuation, and comparable company analysis because
it is possible to infer that share value through comparison to similar companies as there are multiple
listed companies that are comparable to the Company and Holon.
The share exchange ratio was decided through negotiation between the parties, with the above
analyses used as guides.
(4) Outline of Company to Become Wholly-Owning Parent Company Resulting from Share Exchange(as of March 31, 2022)
Name
Address
Position and name ofrepresentative
Business details
Stated capitalEnd of fiscal year

A&D Company, Ltd.
3-23-14, Higashi Ikebukuro, Toshima-ku, Tokyo
President & CEO, Yasunobu Morishima
Research, development, manufacturing and distribution of electronic
measuring instruments, industrial scales, electronic balances,electronic medical instruments, testing machines, and other applied
electronic equipment¥6,388 million
March 3112

(5) Outline of Counterparty Company of Share Exchange (as of March 31, 2022)
Name
Address
Position and name ofrepresentative
Business details
Stated capitalEnd of fiscal year

HOLON Co., Ltd.
5-40-1 Kamisuna-cho, Tachikawa-shi, Tokyo
Representative Director and President, Hao Zhang
Development, manufacture, and distribution of semiconductor electron
beam measurement and inspection equipment¥1,764 million
March 31(6) Outline of Accounting
The accounting in line with the Share Exchange will be processed as transactions with non-controllinginterests as stated in the “Accounting Standard for Business Combinations” (ASBJ Statement No. 21(Revised 2019), January 16, 2019) (hereinafter, the “Business Combinations Standard”) and the“Implementation Guidance on Accounting Standard for Business Combinations and AccountingStandard for Business Divestitures” (ASBJ Guidance No. 10 (Revised 2019), January 16, 2019)(hereinafter, the “Accounting Standard for Business Divestitures”). No goodwill or negative goodwill
results therefrom.
(7) Matters Listed in Case of Additional Acquisition of Subsidiary Shares
Cost of the acquisition of the acquired company and the breakdown thereof
Consideration for the acquisition Common shares ¥6,163 million
Cost of acquisition ¥6,163 million(8) Matters Related to Changes in the Company’s Equity in Transactions with Non-controlling Interests
1) Major factors in the change in share capital surplus
Additional acquisition of subsidiary shares2) Amount of share capital surplus decreased due to transactions with non-controlling interests¥3,395 million
3. Outline of Absorption-Type Company Split(1) Legal form of Absorption-Type Company Split
The Absorption-Type Company Split was conducted through an absorption-type company split inwhich the Company was the splitting company and New A&D, a wholly-owned subsidiary of theCompany, was the succeeding company.
(2) Shares Issued Upon Company Split and Allotment
In conducting the Absorption-Type Company Split, New A&D issued 225,000 common shares andallotted all of them to the Company, the splitting company, as consideration for the business transferredthrough the Absorption-Type Company Split.

(3) Basis of Calculation for Number of Shares Allotted13

As all of the shares to be issued by New A&D in conducting the Absorption-Type Company Split willbe allotted to the Company, no valuation has been conducted by a third-party valuation agency. The
number of shares to be allotted was decided by taking account of such factors as stated capital of New
A&D.

(4) Company Name After Absorption-Type Company Split
The Company has changed its trade name to A&D HOLON Holdings Company, Limited. New A&D
was renamed A&D Company, Ltd., which was the former trade name of the Company.
(5) Handling of Share Options and Bonds Share Options Relating to Absorption-Type Company Split
The Company has issued share options, but the handling thereof will not be changed due to theAbsorption-Type Company Split. Additionally, the Company has not issued any bonds with shareoptions.

(6) Business Divisions Split
All businesses of the Company, excluding the group management and administration business and theasset management business(7) Assets and Liabilities of the Split Business Divisions (as of March 31, 2022)
Assets (Million yen)
Items
Book value
Current assets
16,986
Fixed assets
14,445
Total
31,432

Liabilities (Million yen)
Items
Book value
Current liabilities
7,645
Fixed liabilities
744
Total
8,389

(8) Outline of Succeeding Company in Absorption-Type Company Split (as of March 31, 2022)
Name
Address
Position and name ofrepresentative
Business details
Stated capitalEnd of fiscal year

A&D Split Preparatory Company, Limited
3-23-14, Higashi Ikebukuro, Toshima-ku, Tokyo
Representative Director, Yasunobu Morishima
Research, development, manufacturing and distribution of electronic
measuring instruments, industrial scales, electronic balances,electronic medical instruments, testing machines, and other applied
electronic equipment¥50 million
March 31

(9) Outline of Accounting
The accounting in line with the Absorption-Type Company Split was processed as transactions undercommon control in accordance with the “Business Combinations Standard” and the “AccountingStandard for Business Divestitures.”(Significant subsequent events)(Merger among consolidated subsidiaries)
At a July 26, 2022 meeting, Board of Directors of A&D Company, Ltd., our consolidated subsidiary,
voted to approve to carry out an absorption-type merger between its subsidiaries and change the trade name14

of the surviving company.

1. Reason of Merger
The merger is aimed at strengthening the Group’s competitiveness and improving profitability by unifying
the business management system and further improving efficiency through the effective use of humanresources.
2. Outline of Merger(1) Schedule
July 20, 2022 Resolution date of Board of Directors regarding the merger (company concerned to theabsorption-type merger)
July 20, 2022 Execution date of contract
July 26, 2022 Resolution date of Board of Directors regarding the merger (A&D Company, Ltd.)
July 26, 2022 Resolution date of the General Meeting of Shareholders (company concerned to theabsorption-type merger)
January 1, 2023 Date of the merger (effective date) and date of trade name change(2) Method of Merger
The merger is an absorption-type merger wherein KENSEI KOGYO Co., Ltd. will be the surviving
company and Litra Co., LTD and ORIENTEC CORPORATION will be the absorbed companies.
(3) Details of Allotments Relating to Merger
As all the companies are wholly owned subsidiary of the Company, there will be no consideration forthe merger nor will there be an increase or decrease in the amount of capital.
(4) Status of Succeeding Assets and Liabilities
At the date of the merger (effective date), the surviving company plans to inherit all assets, liabilities
and rights and obligations of the absorbed companies.
3. Profile of Companies Concerned to the Absorption-Type Merger (as of July 26, 2022)
Surviving Company

Absorbed Company

Absorbed Company

Name

KENSEI KOGYO Co., Ltd.

Litra Co., LTD

ORIENTECCORPORATION.

Address

4210-15 Takasai,
Shimotsuma-shi, Ibaraki

7-5 Harajuku, Hidaka-shi,
Saitama

161 Hanzawa Shinden,
Fukaya-shi, Saitama

Position and name Shinichi Watanabeof representative
Representative Director

Kazunori Hatanaka
Hiroshige Uehara
Representative Director and Representative Director
President
and President

15

Business details

Date of
Establishment
Stated capitalEnd of fiscal year

Manufacturing anddistribution of electronicbalances, electronic medical
instruments, and precision
machine parts

Manufacturing of loadcells, indicators, electronicbalances, industrial scale,checkweighers, and otherapplied electronicequipment

Manufacturing of various
material testing machines,
automobile-related testing
equipment, various
semiconductor
manufacturing equipment,
and signal/waveform
analysis equipment

September 1955

June 1985

December 1954

¥81 million¥200 million¥268 million

March 31

March 31

March 31

A&D Company, Ltd. 100%

A&D Company, Ltd. 100%

Major Shareholders
A&D Company, Ltd. 100%and holding ratio

4. Conditions after the Absorption-Type Merger (planned)
Trade nameA&D Manufacturing, Limited

Business details

Manufacturing of electronic measuring instruments, industrial scales,
electronic balances, electronic medical instruments, testing machines, andother applied electronic equipment

Address

4210-15 Takasai, Shimotsuma-shi, Ibaraki

Position and name ofrepresentative

Eisuke Ogaku, Representative Director

Stated capital¥81 million

End of fiscal year

March 31

5. Outline of the Accounting Treatment to be Carried Out
The Company plans to process the accounting as a common control transaction pursuant to the“Accounting Standard for Business Combinations” (ASBJ Statement No. 21 (Revised 2019), January 16,2019) and the “Implementation Guidance on Accounting Standard for Business Combinations andAccounting Standard for Business Divestitures (ASBJ Guidance No. 10 (Revised 2019), January 16, 2019).
As the merger is to be one of consolidated subsidiaries, the effect on the consolidated business results of
A&D HOLON Holdings Company, Limited will be negligible.

16