COMPANY RESEARCH AND ANALYSIS REPORT

Altech Corporation
4641
Tokyo Stock Exchange Prime Market

2-May-2024
FISCO Ltd. Analyst

Ikuo Shibata

FISCO Ltd.
https://www.fisco.co.jp

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html■ Index■Summary---------------------------------------------------------------------------------------------------------------------------------------------------------------------------- 01
1. Company profile.. ................................... ......................................................................................................
2. FY12/23 consolidated results.. ............... ......................................................................................................
3. Outlook for FY12/24. . ............................. ......................................................................................................
4. Medium- to long-term growth strategy.. ......................................................................................................

01
01
01
02

■Company profile---------------------------------------------------------------------------------------------------------------------------------------------------------- 03
1. Company profile.. ................................... ......................................................................................................
2. Group structure (and bases). . ................. ......................................................................................................
3. Business overview................................. ......................................................................................................
4. History................................................... ......................................................................................................

03
05
06
07

■Business performance------------------------------------------------------------------------------------------------------------------------------------------ 09
1. Trends in past results (consolidated)............................................................................................................
2. Overview of FY12/23 results........................................................................................................................
3. Summary of FY12/23 results. . ......................................................................................................................

09
11
13

■Main activities and achievements-------------------------------------------------------------------------------------------------------------- 14
1. Recruitment and education achievements. ..................................................................................................
2. Progress made in new business.. .................................................................................................................

14
14■Business outlook-------------------------------------------------------------------------------------------------------------------------------------------------------- 15
1. Outlook for FY12/24. . ............................. ......................................................................................................
2. View of FISCO’s analysts.............................................................................................................................

15
16■Medium- to long-term growth strategy------------------------------------------------------------------------------------------------ 16
1. Twelfth five-year plan (qualitative targets)....................................................................................................
2. Medium-term management plan (three-year quantitative targets). ...............................................................
3. Industry trends and the Company’s position. ...............................................................................................
4. Medium- to long-term focal points. . ....... ......................................................................................................

16
17
17
18

■Sustainability initiatives--------------------------------------------------------------------------------------------------------------------------------------- 18
1. Initiatives for SDGs................................ ......................................................................................................
2. Establishment of a basic policy on sustainability. ........................................................................................

18
19■Shareholder return policy---------------------------------------------------------------------------------------------------------------------------------- 20
1. Basic dividend policy............................. ......................................................................................................
2. Dividend trend and plan...............................................................................................................................

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20
20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html■ SummaryIn FY12/23, sales and operating profit rose to record highs.
R&D for next-generation automobiles, semiconductor-related areas,and so forth was brisk.
In FY12/24, the Company expects the sales and operating profit
uptrend to continue
1. Company profile
Altech Corporation <4641> (hereafter, also “the Company”) is a comprehensive engineering outsourcer that provides
high-level technological services to major manufacturing companies in fields such as machinery, electricity andelectronics, software, IT, and chemistry. It places great importance on its “Heart to Heart” corporate philosophy andconsistently since its foundation, it has focused on human education from the standpoint of maintaining the highest
levels among its employees not only as engineers, but also as members of society, in addition to strengthening theirtechnical abilities. Upon the 55th anniversary of its foundation in July 2023, it announced the twelfth five-year plan(qualitative targets) as its vision up to 2028. It plans to work on strengthening its foundation for sustainable growthby leveraging cutting-edge technology to take on new domains and grow new revenue streams such as agriculture
and nursing care business.
2. FY12/23 consolidated results
In FY12/23 consolidated results the Company recorded increased sales and profit, with net sales of ¥46,216mn,
up 5.9% year on year (YoY), and operating profit of ¥4,982mn, up 7.2%, achieving record highs. Although the
manufacturing industry is experiencing soaring raw material prices, logistics costs, and personnel expenses, R&D
investment is firm, especially in the semiconductor industry, which is performing well, and the automotive industry,where the development of next-generation automobiles is intensifying. Results were led by an increase in mobilizedengineers (maintaining a high mobilization rate) and improvements to contract unit prices. Additionally, the Global
Business, where demand is growing mainly for the semiconductor industry, continued to maintain strong performance following the previous term. On the earnings front, the cost of sales increased due to improved compensation,
but that was offset by a boost to earnings from sales growth, and the operating profit margin remained above
10%. In activities looking to the future, notable results were achieved in new businesses (agriculture- and nursing
care-related businesses).
3. Outlook for FY12/24
In its outlook for FY12/24, the Company is forecasting continued growth in sales and profits, with net sales toincrease 7.1% YoY to ¥49,500mn and operating profit to increase 4.4% to ¥5,200mn. With brisk customer needs,
including expanding demand in semiconductors and medical systems, as well as software development related toadvanced technologies, net sales and operating profit are both expected to grow steadily. Also, agriculture-related
fields where the acceptance of personnel from abroad has progressed along with the lifting of immigration restrictions
are apparently expected to contribute to earnings growth.

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01 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation

2-May-2024

4641 Tokyo Stock Exchange Prime Market

https://www.alpsgiken.co.jp/english/index.html

Summary

4. Medium- to long-term growth strategy
Under the newly released twelfth five-year medium-term plan (qualitative targets), the Company aims to 1) take on
new domains of engineering outsourcing business, 2) develop new earnings pillars, 3) help create a sustainable,
prosperous society, and 4) employ digitalization to foster an organizational culture where diverse personnel thrive
based on the theme “utilizing technology to challenge partners in a co-creative society.” Also, in the three-year(rolling) medium-term management plan, it has set FY12/26 targets of net sales of ¥55,500mn, operating profit of¥5,700mn, and ROE of 20% or above.
Amid a declining Japanese population and economic globalization, we at FISCO consider that the direction that
the Company is taking for its business development is a rational strategy that anticipates future changes in theindustrial structure. Looking ahead, the key points to focus on will be how many new growth pillars can be set on
track, including new businesses such as agriculture and nursing care and manufacturing business, and whether
these will lead to sustainable growth.
Key Points
Achieved increased sales and profit in FY12/23, setting new record highs. This was accomplished through anincrease in mobilized engineers (maintaining a high mobilization rate) and improvements to contract unit prices.
• R&D for next-generation automobiles, semiconductor-related areas where demand is growing, and so forth was
brisk.
• In FY12/24, the Company expects the sales and profit uptrend to continue.
• Under the twelfth five-year plan (qualitative targets), it plans to work on growing new earnings pillars focusing
on agriculture- and nursing care-related areas, take on new domains by utilizing cutting-edge technology, andso on based on the theme of “utilizing technology to challenge partners in a co-creative society.”•

Business performance
Net sales (left)

Operating profit (right)

(¥mn)

(¥mn)

60,0004,982
4,649

50,00040,000

5,200

3,640

5,000

3,875
4,000

30,00020,000

6,000

3,000

35,75339,261

43,647

46,21649,5002,000

10,0001,000

00FY12/20

FY12/21

FY12/22

FY12/23

FY12/24 E

Source: Prepared by FISCO from the Company’s financial results

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02 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html■ Company profile
From its predecessor of a design office, it has become a groupof high-level engineers that provides technologies according tocustomer requests
1. Company profile
The Company is a comprehensive engineering outsourcing company that provides advanced technological services
to major manufacturing companies in fields such as machinery, electricity and electronics, software, IT, and chemistry. Its features include that unlike fixed-term employment-based employment agencies, it only employs full-timeengineers*, and it is a group of highly skilled engineers specializing in upstream processes, such as development
and design.
*	For example, even during recession periods such as the 2008 financial crisis, it has not dismissed employees.

Based on its “Heart to Heart” corporate philosophy, consistently since its foundation, the Company has focused onhuman education from the standpoint of maintaining the highest levels among its employees not only as engineers,
but also as members of society, in addition to strengthening their technical abilities. In particular, its strengths include
its corporate organizational culture which produces high-quality human resources and an original education andtraining system*, and its results are steadily growing, supported by its excellent reputation among its customers
and the favorable ordering environment.
*	The Company has established an education and training system, broadly divided into the abilities development education
system and career development support, to develop human resources to have advanced technical skills and expertise,including education according to level and needs, and follow-up from career supporters (senior engineers). Moreover, theemployment period is indefinite (permanent employees), which enables long-term education and training plans.

In accordance with the Revised Worker Dispatching Act (enforced on September 30, 2015), the employment period
limitation was ended for indefinite-term employment, while incidental work was also ended due to the abolition of
specialized work classifications. Also, the acceptance of foreign workers (the establishment of a new residency
status) is to be expanded following the revision to the Immigration Control and Refugee Recognition Act (enforcedon April 1, 2019), and these and other revisions have been positive developments for the Company. Although theCompany was affected by immigration restrictions from FY12/20 onward due to COVID-19 pandemic, it has recently
made full-scale efforts to employ global human resources along with the lifting of the restrictions. In addition, equalpay for equal work regulations, which were enacted in April 2020, will not have a negative impact on the areas ofdevelopment and design, since these areas traditionally achieve high unit prices.
At the end of December 2023, the Company had 4,516 engineers, among which 4,397 were mobilized. Over the
past few years, the Company has maintained an overall high mobilization rate despite a certain level of impact of
COVID-19 pandemic.

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03 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html

Company profile

The Company has two business segments, the Outsourcing Business, which is mainly an assignment and outsourcing business in Japan, and the Global Business, which supports Japanese companies’ operations overseas.
The Outsourcing Business generates the majority of net sales, but the policy* going forward is to expand the Global
Business, for which there is strong demand primarily from Japanese companies located in East Asia, as well as
new businesses (agriculture and nursing care, etc.), which are considered to have high growth potential, and the
manufacturing business, in which the Company can develop strengths for the next generation.
*	New businesses (agriculture and nursing care) and the manufacturing business, centered on consolidated subsidiaries
DONKEY Corporation and Digital Spice Corporation are currently included in the Outsourcing Business.

In net sales by industry, 31.9% is provided by automotive-related*, in which R&D investment is active, and a total of
36.2% by semiconductor, precision equipment and electrical machinery-related. Therefore, its customer industries
are diverse and structured so that the Company is not easily affected by economic fluctuations. Also, recently its
market shares of strongly performing fields such as semiconductors development have been trending upward. It also
has around 700 customer companies, and the extent of its reliance on the top 10 customers for sales (mainly major
manufacturers, such as Tokyo Electron Technology Solutions Ltd., Mitsubishi Electric Corporation <6503>, and Sony
Semiconductor Manufacturing Corporation) is 21.8%, so it avoids relying on a single company (FY12/23 results).
*	E ven if the technological field is electrical machinery, if the final product is an EV (electric vehicle), it is classified as“automotive-related.”

Composition of net sales by industry (FY12/23 results)

Aerospace defense
3.0%

Machine toolsrelated
5.1%Electricity-related
6.9%

Others
17.7%
Automotiverelated
31.9%

Medical-related
6.1%
Precisionmachineryrelated
8.9%

Semiconductorrelated
20.4%

Source: Prepared by FISCO from the Company’s briefing materials

We encourage readers to review our complete legal statement on “Disclaimer” page.

04 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html

Company profile

2. Group structure (and bases)
In total, there are seven consolidated subsidiaries (as of the end of FY12/23)* 1: ALPS BUSINESS SERVICECORPORATION, a provider of total staffing services, ALPSGIKEN TAIWAN CO., LTD. (Taiwan) and Altech Shanghai
Co., Ltd. (China), which conduct the Global Business; as new businesses, Alps Agri Career Corporation, which
operates in the agriculture-related field and Alps Care Heart Corporation, which operates in the nursing care-related
field; Digital Spice Corporation*2, which joined the Group in July 2020, and DONKEY Corporation*3, which became
a consolidated subsidiary in February 2022. The Group also includes the non-equity-method affiliate ALPSGIKENMYANMAR CO., LTD., which was established in October 2020. The Group has approximately 6,000 employees,
among which less than 10% are global human resources. In addition to the Head Office (Yokohama City), Altech
Corporation Building No. 1 (Sagamihara City, formerly the back office and training center), and Altech Corporation
Building No. 2 (Sagamihara City), the Company also has 2 techno parks for manufacturing, 23 sales offices in Japan,
and 1 overseas branch (Myanmar).
*1	PANA R&D CO., LTD., which joined the Group in September 2016 and carries out the assignment of engineers, wasremoved from the scope of consolidation at the end of FY12/23 because it was absorbed and merged with the Company
on April 1, 2023.
*2	Digital Spice is engaged in the assignment of engineers and contracted business in the fields of machinery, electricaland electronics, and software, and has handled a series of design and development work rooted in digital technology.
In recent years, it has supported customers’ manufacturing as a group of professionals with advanced technologicalcapabilities, including cooperating in the development of the asteroid probe Hayabusa.
*3	D ONKEY is the business which arose from the Company’s participation in November 2017 in a consortium for thedevelopment of next-generation agricultural robots carried out by parties including The Japan Research Institute, Limited
and Keio University.

Group structure
ALPS BUSINESSSERVICE CORPORATION
Assignment of engineers
Human resource
referrals
Digital Spice Corporation
Assignment of engineers
Software development
Design andmanufacturing

Alps Care Heart
Corporation
Home-visit nursing careservices business
utilizing IT

Strengthening
standing in the
manufacturing
field

Solving problems
in the nursing
care industry

Securing diverse
human resources
with an eye tochanges

ALPSGIKENMYANMAR CO., LTD.
Human resource
development businessEngineering businessAltechCorporation

ALPSGIKENTAIWAN CO., LTD.
Engineering business
Human resource
Business
services
expansion within
Southeast Asia
Altech Shanghai Co., Ltd.
Engineering business
Human resource
services

Solving problems
in the agricultureindustry

DONKEY Corporation
Development ofagriculture robots

Alps Agri Career
Corporation
Outsourcing businessin the agriculture

Source: The Company’s website

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05 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html

Company profile

3. Business overview(1) Outsourcing BusinessOutsourcing Business is the Company’s core business. It specializes in the development and design fields, which
are manufacturing upstream processes, and positions the provision of high-level technological services by designand development engineers as the center of its business model.
The Company provides services in the form of assignment engineers and outsourcing. Assignment services takethe form of spot assignments (assignment of a single engineer) and team assignments (assignment of a team ofengineers whose members have various high-level skills and who conduct product design and development work).
The outsourcing services take the form of on-site (the engineer is stationed at the customer’s site) and off-site(the engineer returns to the Company’s techno park or other site) for project outsourcing (outsourcing of design,
prototyping, manufacturing, and evaluation, either on a single or collective contract basis).
Since it was founded as a design office, the Company has met the technical needs of its customers in the fieldof mechatronics through its concept of “machinery and electrical integrated design.” In particular, it utilizes its
strength of having a unique business form with its own manufacturing bases (its own factories), and the Groupoverall has established a structure able to handle all the manufacturing processes, from development, prototyping,
manufacturing to evaluation. Even within this structure, the Company’s main area of technological expertise is
upstream processes, where it possesses competitive advantages in the processes requiring high-level technological capabilities, including basic research, product planning, concept design, detailed and mass production
design, prototypes and experiments, and evaluation and analysis.
The central areas of the technology field include machinery design, electricity and electronics design, softwaredevelopment, and chemistry. Alongside the transition to a high-level network society, the priority items havebecome the development and design of a variety of advanced technologies such as for IoT and AI, 3D-CAD
for which further demand is expected, CAE technologies, and aerospace-related, medical-related, and robot
development technologies. Therefore, the Company’s customer companies are spread across a wide range ofindustries, including automotive, semiconductors and LSI, industrial equipment, digital precision equipment,
aerospace, space and defense, and medical and welfare equipment.
(2) Global Business
The Company currently has three overseas subsidiaries, ALPSGIKEN TAIWAN CO., LTD., Altech Shanghai
Co., Ltd., and ALPSGIKEN MYANMAR CO., LTD., which was established in October 2020. In addition to work
for installing production facilities and other facilities and providing maintenance and ancillary staffing services,
ALPSGIKEN MYANMAR CO., LTD. conducts business to develop human resources who can be active in various
fields, including the fields of technology, agriculture, and nursing care, through the management of the Altech
Higher Vocational Training College. The expansion of Global Business serves as one strategic axis amid theadvancement of economic globalization.

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06 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html

Company profile(3) New businesses (agriculture- and nursing care-related fields)
These businesses are being developed by Alps Agri Career Corporation (agriculture-related field)*, and Alps Care
Heart Corporation (nursing care-related field), which was established in July 2021. As they have only just beenlaunched, they are currently included in the Outsourcing Business segment. The goal is to create a new modelfor the worker assignment markets for the agriculture-related field, which is a growth industry, and the nursing
care-related field, which is experiencing a noticeable shortage of human resources. It is said that in these fields,
the keys are introducing state-of-the-art technologies, such as AI, IoT, and robots, and utilizing an overseas labor
force. It appears that the Company’s strategy is to seek first-mover advantages in fields where it can utilize its
advanced technological capabilities and expertise in developing human resources (including recruitment of global
human resources) that it has cultivated up to now.
*	Changed its name from Agri & Care Corporation on July 1, 2021 and made a new start as a company specializing in the
agriculture-related field.

4. History
The Company’s predecessor, the Matsui Design Office, was founded in 1968 based on the concept of “mechanicaland electrical integrated design” of its founder, Toshio Matsui. At that time, electrical design and mechanical design
were conducted separately, and to solve the various problems that arose from this, he proposed “mechanical andelectrical integrated design” to customer companies as a proprietary and innovative method. The Company has
encountered various difficulties, including the oil crises, but through constant efforts it has steadily gained an excellent reputation among its customers for being a comprehensive engineering outsourcer “that provides technologies
according to customer requests.” Furthermore, under the leadership of the current President and Representative
Director Atsushi Imamura, it is aiming to improve results and expand its business, including by focusing on training
human resources who are specialized in upstream processes, such as development and design, and the early
mobilization of new graduate engineer.
History
Date
July 1968
January 1971

Major event
Matsui Design Office was founded in Sobudai, Sagamihara City, Kanagawa Prefecture
Started the first five-year plan, “Develop the Company”
Renamed the Matsui Design Office as Altech Inc., and established it in Sobudai, Sagamihara City, Kanagawa Prefecture

July 1973

Started the second five-year plan, “Increase Business with Prime Customers and Maintain Internal Capital”

July 1978

Started the third five-year plan, “Implement an Institutionalization of the Company and Improve Technical Capabilities”

January 1981

Moved head office to Kyowa, Sagamihara City, Kanagawa Prefecture

March 1981

Reorganized the organization and transferred it to Altech Corporation

July 1983

Started the fourth five-year plan, “To be an International company and Develop Human Resources”

April 1984

Opened the Tohoku business office in Koriyama City, Fukushima Prefecture

April 1985

Opened the Shinshu business office in Shiojiri City, Nagano Prefecture

July 1985

Constructed a building in Nishi-Hashimoto, Sagamihara City, Kanagawa Prefecture and relocation of Head OfficeFebruary 1986

Established Kita Kanto business office in Fukaya City, Saitama Prefecture

April 1986

Established subsidiary Technical Training Center CO., LTD. (currently, ALPS BUSINESS SERVICE CORPORATION) from thetechnical training department

July 1988

Started the fifth five-year plan, “Restructuring of the Organization and Developing the Company’s own Technology”

December 1989
October 1990

Established Tateshina Techno Park in Chino City, Nagano Prefecture, started production of in-house developed products and thedesign and production of precision machinery
Adopted a divisional organization structure to utilize profit center management and accounting systems.
Established six business division below the Tohoku business division

July 1993

Started the sixth five-year plan, “Nurture High-quality Human Resources for High-quality Companies”

June 1996

Altech is listed on the OTC market of the Japan Securities Dealers Association (currently, JASDAQ)
Increased capital to ¥832,619,000

July 1997

Increased capital to ¥1,502,219,000

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07 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html

Company profile

Date

Major event

January 1998

The Tokyo Business Division was separated from the Kanto Division, and the West Japan Division divided into the Osaka Division,
the Nagoya Division and the Kyushu Division, and the Tateshina Techno Park was newly established from the Chubu Division. In
addition to Tohoku Division, the Company became an eight-business division structure

July 1998

Started the seventh five-year plan, “Restructuring our Business Field and our Core Competencies”

September 1998

Completed the new building of Chubu business division as own property in Shiojiri City, Nagano Prefecture

December 1998

Established the Taiwanese subsidiary (currently, ALPSGIKEN TAIWAN CO., LTD.), in Taipei City, Taiwan

October 1999
July 2000
September 2000
July 2001
March 2003
July 2003
October 2004
December 2004

Utsunomiya Factory (now Utsunomiya Techno Park) opened in Yaita City, Tochigi prefecture
Tateshina Techno Park No. 2 factory completed
Listed on the second section of the Tokyo Stock Exchange (listing date September 28, 2000)
Completed a new building and the Training Center
Relocated the Head Office
Introduced a business headquarters system from the business division system (four blocks nationwide)
Started the eighth five-year plan, “Creation of New Corporate Value”
Entered-into a technical alliance with Qingdao University of Science Technology in China, opened the “Machinery Design
Education Program”
Listed on the Tokyo Stock Exchange First Section (first section designation date, December 1, 2004)

July 2005

Introduced the central organization structure to upgrade risk management capabilities

April 2006

Entered-into a technical alliance with China University of Petroleum, established the China University of Petroleum ALPS
International Engineer Education Center

July 2006

Issued 1st unsecured convertible bond type bonds with stock acquisition rights of ¥2 billion

January 2007

Opened the Atsugi Sales OfficeFebruary 2007

Participated in the establishment of the Nippon Engineering Outsourcing Association (currently, NEOA (public interest incorporated
association))

March 2007
July 2007
October 2007
July 2008
January 2009

Established subsidiary ALTECH QINGDAO CO., LTD. in Qingdao City, China
Opened the ALPS Qingdao Education Development Center (Qingdao City, China)
Opened the Tsukuba Sales Office (currently, the Hitachi Sales Office)Started the ninth five-year plan, “Leap to be a Leading Company”
Established the subsidiary Altech Forest Corporation

March 2009

Opened the Takasaki Sales Office

March 2010

Established the subsidiary Altech Shanghai Co., Ltd. in Shanghai, China

March 2011

Relocated Head Office to Minato Mirai, Nishi Ward, Yokohama City, Kanagawa Prefecture
Opened the Hitachi Sales OfficeFebruary 2012

Opened the Kyoto Sales Office

August 2012

Established the subsidiary Alps Career Designing Corporation in Chiyoda Ward, Tokyo

July 2013

Started the tenth five-year plan, “Expansion of Enterprise Scale through Innovation”~ Accelerate growth as we move toward our 50th anniversary ~December 2014
April 2015
September 2016
April 2017
September 2017

Subsidiary Altech Forest Corporation removed from the scope of consolidation on the transfer of shares
Opened Yangon branch office in Myanmar (Yangon city)
Made PANA R&D CO., LTD. a consolidated subsidiary
ALPS BUSINESS SERIVCE CORPORATION merged with Alps Career Designing Cooporation
Start of broadcasts of TV commercials
Divided the Nagoya Sales Office into the Nagoya Office I and the Nagoya Office II, and opened the Himeji Sales Office

April 2018

Established Agri & Care Corporation in order to enter-into new business fields (agriculture- and nursing care-related fields) (capital:¥100,000,000)

July 2018

Started eleventh five-year plan, “Reinvestment of Management Resources toward the New Industrial Revolution”

September 2018

Completed the Altech Corporation Building No. 2

May 2020

Conducted a capital increase for DONKEY Corporation and made it an affiliate

July 2020

Made Digital Spice Corporation a consolidated subsidiary (capital: ¥27,500,000)

October 2020
July 2021
February 2022

Established the subsidiary ALPSGIKEN MYANMAR CO., LTD. in Myanmar (Yangon City) (capital: USD 200,000, including capitalreserve)
Subsidiary Agri & Care Corporation changed its name to Alps Agri Career Corporation
Established the subsidiary Alps Care Heart Corporation (capital: ¥100,000,000)
Made DONKEY Corporation a consolidated subsidiary (capital: ¥250,000,000)

April 2022

Transferred to the Tokyo Stock Exchange Prime Market

April 2023

Conducted an absorption-type split where subsidiary PANA R&D CO., LTD.’s consignment department was succeeded by thesubsidiary Digital Spice Corporation, while its other departments were merged into Altech Corporation

July 2023

Started the twelfth five-year plan, “Utilizing Technology to Challenge Partners in a Co-Creative Society”

Source: Prepared by FISCO from the Company’s website

We encourage readers to review our complete legal statement on “Disclaimer” page.

08 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html■ Business performance
Growth in results driven by increasing the number of mobilized
employees by actively recruiting new graduates and mobilizing themat an early stage, as well as improvement in the contract unit price
1. Trends in past results (consolidated)
Looking back at business performance up to now, we see that it has steadily grown alongside the increase in thenumber of engineer employees. Particularly since FY12/14, despite the ongoing severe recruitment environment,
the Company has still been able to recruit around 250-300 new graduates per year and achieve early mobilization,
which has driven the growth in results. It can be said that recruiting new graduates at a stable level every year andglobal human resources*1 in fields with high levels of specialty, and completing their training at an early stage by
promoting team formation*2 and maintaining a high mobilization rate is a growth model unique to the Company. For
the contract unit price*3 as well, a performance indicator just as important as the number of mobilized employees, themarket value has been steadily rising every year from the skills development programs and planned rotations basedon the career plans of each worker (however, there was a decrease in FY12/20 due to temporary factors caused by
COVID-19). Moreover, the collaboration with consolidated subsidiary ALPS BUSINESS SERVICE CORPORATION
and PANA R&D CO., LTD.*4, expansion of overseas business, and performance of Alps Agri Career Corporation,
which is engaged in new business, contributed to the growth in consolidated results. Even from FY12/20 to FY12/21
when results were impacted by COVID-19, there were no major changes to the trends of the performance indicatorsthat the Company prioritizes, which one could argue confirm the robustness of its businesses.
*1	In FY12/23, 40 engineers were hired (standalone) and just over 100 agriculture-related personnel (Alps Agri Career).
*2	By utilizing team assignments (consisting of multiple people), new employees can work while being guided, educated,
and trained by senior engineers, enabling a strategy for their early mobilization. It seems that this framework is also highly
evaluated by customers, as it gives them peace of mind.
*3	The unit price per hour based on the contract with the customer. Unlike the actual unit price that constitutes sales, itdoes not include overtime.
*4	PANA R&D was removed from the scope of consolidation at the end of FY12/23 because it was absorbed and mergedwith the Company on April 1, 2023.

In terms of profit and loss, profits have trended upward alongside the growth in net sales and the operating profit
margin has also improved, trending at a high level above 10% for the past few years. The Company retained
an operating profit margin of around 10% between FY12/20 and FY12/21, when it was impacted by COVID-19
pandemic, and recovered up to the level of 10.7% in FY12/22 and 10.8% in FY12/23.
For the Company’s financial condition, the equity ratio remained at a level above 60% while total assets grewfollowing the increases in cash and deposits and other items. On the other hand, ROE, which indicates capitalefficiency, is rising year by year, and since FY12/17, it has consistently exceeded 20%. Therefore, the Company’s
financial condition can be evaluated as being extremely good. It also has plentiful liquidity on hand (cash anddeposits), which serves as a buffer against unforeseen circumstances and expands the range of strategies it canadopt for growth, so it will be necessary to pay attention to M&A and other developments in the future.

We encourage readers to review our complete legal statement on “Disclaimer” page.

09 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html

Business performance

Trends in net sales and operating profit margin (consolidated)
Net sales (left)(¥mn)

Operating profit margin (right)

60,00018.0%

50,00015.0%

40,000

10.9%

10.7%

11.0%

10.2%

10.7%

9.9%

10.8%

12.0%

10.5%

30,0009.0%

20,00032,78130,26036,371

43,64739,26135,753

46,21649,500

6.0%

10,000

3.0%

0

0.0%
FY12/17

FY12/18

FY12/19

FY12/20

FY12/21

FY12/22

FY12/23

FY12/24 E

Source: Prepared by FISCO from the Company’s financial results

Trends in the number of new graduate recruits and engineers(standalone)(people)New graduate recruits (left)(people)Engineers (right)

400

4,516

320

3,518

3,783

3,897

3,969

5,000

4,165
4,000

3,175
240

3,000

160

288

314

242

314

330

289

2,000

233

80

1,000

0

0
FY12/17

FY12/18

FY12/19

FY12/20

FY12/21

FY12/22

FY12/23

Source: Prepared by FISCO from the Company’s briefing materials

We encourage readers to review our complete legal statement on “Disclaimer” page.

10 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation

2-May-2024

4641 Tokyo Stock Exchange Prime Market

https://www.alpsgiken.co.jp/english/index.html

Business performance

Trends in equity ratio and ROE (consolidated)
Equity ratio
70.0%

66.6%
61.1%

62.4%

60.7%

25.6%

24.6%

FY12/19

FY12/20

ROE
67.2%

64.8%

64.6%

22.6%

22.6%

22.7%

FY12/21

FY12/22

FY12/23

60.0%
50.0%
40.0%
30.0%

20.5%

23.3%

20.0%
10.0%
0.0%
FY12/17

FY12/18

Source: Prepared by FISCO from the Company’s financial results

2. Overview of FY12/23 results
In FY12/23, the Company posted increase in sales and profits, achieving a new record high. Net sales were¥46,216mn, up 5.9% YoY, operating profit was ¥4,982mn, up 7.2%, ordinary profit was ¥5,053mn, up 10.8%, andprofit attributable to owners of parent (final profit) was ¥3,696mn, up 8.2%.
Although the manufacturing industry is experiencing soaring raw material prices, logistics costs, and personnel
expenses, R&D investment is firm, especially in the semiconductor industry, which is performing well, and theautomotive industry, where the development of next-generation automobiles is intensifying. Results were led byan increase in mobilized engineers (maintaining a high mobilization rate) and improvements to contract unit prices.
Additionally, the Global Business, where demand is growing mainly for the semiconductor industry, continued tomaintain strong performance following the previous term.
On the earnings front, the cost of sales increased due to improved compensation, but that was offset by a boost
to earnings from sales growth, and the operating profit margin remained above 10% at 10.8%. Final profit sharply
exceeded plan, mainly due to gains on the sale of investment securities held, and the receipt of a tax credit for
promoting wage increases.
On the financial front, total assets rose 3.1% from the end of the previous fiscal period to ¥25,025mn, mainly due
to an increase in cash and deposits. Also, shareholders’ equity rose 7.2% to ¥16,822mn due to the accumulationof internal reserves. Therefore, the equity ratio increased slightly to 67.2% (64.6% at the end of the previous fiscal
period).

We encourage readers to review our complete legal statement on “Disclaimer” page.

11 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation

2-May-2024

4641 Tokyo Stock Exchange Prime Market

https://www.alpsgiken.co.jp/english/index.html

Business performance

Overview of FY12/23 results(¥mn)
FY12/22
Results

FY12/23

% of
sales

43,647

Results

YoY

% of
sales

FY12/23

ChangeRate ofchangeForecast

% of
sales

ChangeAchievement
rate

2,568

5.9%

46,600

-383

99.2%

Outsourcing Business

40,141

92.0%

42,688

92.4%

2,546

6.3%

-

-

-

-

Global Business

3,505

8.0%

3,527

7.6%

21

0.6%

-

-

-

-

Cost of sales

33,15976.0%

35,263

76.3%

2,104

6.3%

-

-

-

-

SG&A expenses

5,839

13.4%

5,970

12.9%

130

2.2%

-

-

-

-

Operating profit

4,649

10.7%

4,982

10.8%

333

7.2%

5,000

10.7%

-17

99.6%

4,430

11.0%

4,548

10.7%

118

2.7%

-

-

-

-

216

6.2%

431

12.2%

215

99.4%

-

-

-

-

Ordinary profit

4,560

10.4%

5,053

10.9%

492

10.8%

5,060

10.9%

-6

99.9%

Profit attributable to ownersof parent

3,416

7.8%

3,696

8.0%

279

8.2%

3,420

7.3%

276

108.1%

Number of engineers

4,165

4,516

351

Number of mobilized
employees

4,056

4,397

341

Mobilization hours*1

163.9

162.5

-1.4

Contract unit price*2 (¥)

4,084

4,183

99

Net sales

Outsourcing Business
Global Business

46,216

Vs. forecast*1 Hours worked per month, corresponding to work as an engineer*2 This refers to the unit price per hour based on the contract with the customer. Unlike the actual unit price that constitutes sales, it does not include overtime.
Note: Percentages related to operating profit represent the ratio of operating profit to net sales for each segment
Source: Prepared by FISCO from the Company’s financial results and briefing materials

FY12/23 financial condition(¥mn)
End-FY12/22

End-FY12/23

ChangeRate of change

18,151

19,263

1,111

Cash and deposits

10,696

11,430734

6.9%Note and accounts receivable – trade, other

6,622

6,547

-75

-1.1%
103.5%

Current assets

6.1%

Work in process

238

484

246

Non-current assets

6,122

5,762

-360

-5.9%

Goodwill

243

159

-84

-34.6%

Total assets

24,27425,025751

3.1%

Current liabilities

-3.6%

8,133

7,838

-294

Accounts payable - trade

1,978

1,941

-36

-1.9%

Short-term loans payable

274

224

-50

-18.3%

399

320

-79

-19.8%

Total liabilities

8,532

8,158

-373

-4.4%

Net assets

15,741

16,866

1,124

7.1%

15,687

16,822

1,134

7.2%

Current ratio

223.2%

245.8%

22.6pt-Equity ratio

64.6%

67.2%

2.6pt

-

Interest-bearing debt ratio

2.0%

1.5%

-0.5pt-Non-current liabilities

Shareholders’ equity

Source: Prepared by FISCO from the Company’s financial results(1) Outsourcing BusinessNet sales increased 6.3% YoY to ¥42,688mn and segment profit increased 2.7% to ¥4,548mn. Growth was driven
by factors including an increase in the number of mobilized engineers due to an increase in engineers and in themobilization rate, and improvements to contract unit prices.

We encourage readers to review our complete legal statement on “Disclaimer” page.

12 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html

Business performance

Looking at the performance indicators (standalone) that the Company prioritizes, the number of engineers
increased to 4,516 (up 351 engineers from the end of the previous fiscal year), and the number of mobilizedengineers increased to 4,397 (up 341 engineers). The full-year average mobilization rate was 96.1% (also 96.1%
in the previous fiscal year) including newly graduated engineers (289 people), staying close to full mobilization.
Contract unit prices per person rose ¥99 to ¥4,183. In contrast, mobilization hours were slightly lower at 162.5
hours (down 1.4 hours), but apparently currently show signs of recovery.
By industry, net sales were strong in automotive-related fields where development of eco-friendly and othernext-generation vehicles is escalating, and brisk in semiconductor-related fields where demand is growing alongside the promotion of digital transformation (DX). This can be viewed as steps to address growth fields having
contributed to earnings growth.
Regarding Group companies, ALPS BUSINESS SERVICE performed well, and Alps Agri Career, which is involvedin agriculture-related fields, experienced significant growth accompanying the acceptance of foreign workers. Also,
home-visit nursing care service provider Alps Care Heart increased the number of its offices, mainly in Kanagawa
Prefecture. It is still small in scale but continues to grow steadily.
On the earnings front, the cost of sales increased due to improved compensation, and new businesses (agriculture- and nursing care-related fields) are still in the upfront cost stage but boosted earnings through sales
growth. As a result, the segment secured profit growth and maintained a high profit margin of 10.7% (11.0% in
the previous fiscal year).
(2) Global BusinessNet sales increased 0.6% YoY to ¥3,527mn and segment profit increased 99.4% to ¥431mn. As in the previous
fiscal year, additional orders for large-scale projects, mainly in the semiconductor industry, and expansion ofstaffing services business contributed to earnings growth. Also, the segment profit margin improved to 12.2%(6.2% in the previous fiscal year).
3. Summary of FY12/23 results
To summarize FY12/23, that the Company was able to expand the number of workers mobilized and increase
contract unit prices while shifting to growth fields amid uncertain prospects and challenging earnings conditions
for the manufacturing industry overall demonstrates its strengths. Also, in terms of activities, that the Company
achieved some success on both new graduate and mid-career hiring amid escalating recruitment competition, andstarted to accept global resources in earnest as immigration restrictions have been lifted will be positive catalysts
moving forward. In nursing care-related business, home-visit nursing care services grew, and the Company wasable to show a new direction for the business (elderly housing with home-care services).

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13 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html■ Main activities and achievements
Expanded agriculture-related personnel, and made noteworthy
achievements in nursing care-related business
1. Recruitment and education achievements
In human resource recruitment, which serves as the Company’s growth driver, the Company secured 289 people(330 in 2022) as new 2023 college graduates (standalone), while the number of engineering staff (standalone) at theend of the period increased to 4,516 (up 351 from the end of the previous fiscal year), due to the hiring of about 120
career human resources with an emphasis on quality.* About 210 new 2024 college graduates are scheduled to join
the Company. As for global human resources, the lifting of COVID-19-related immigration restrictions allowed theCompany to accept approximately 40 global engineers and 100 agriculture-related personnel, bringing the numberof foreign personnel to 520 at the end of FY12/23.
*	PANA R&D’s absorption-type merger (on April 1, 2023) also contributed to growth in the number of engineer employees(standalone).

For education, the Company has arranged approximately 1,000 courses, and held 2,463 study sessions at eachlocation. The topics of these study sessions include acquiring certification, career development, leadership development, and more recently, have focused on training engineers to work in cutting-edge fields.
2. Progress made in new business(1) Agriculture-related field
Given the notable shortage of agriculture-related human resources within Japan, Alps Agri Career established asystem alongside the lifting of immigration restrictions put in place due to COVID-19 and positioned itself on a
track toward growth. In particular, it is charting a course towards solving challenges by providing a wide rangeof human resource services from agritech* to farming (temporary staffing). In FY12/23, about 100 global humanresources were accepted and about 40 domestic new college graduates joined the Company, bringing the numberof agriculture-related personnel to about 300 (including about 200 global human resources), and a turn to profit
on a single month basis has apparently come into sight with business expansion. Going forward, the Company
also plans to expand into agritech fields utilizing tools like robots, partly by collaborating with the Group company
DONKEY.

*	Agritech refers to the use of information transmission technology such as IoT and drones in agricultural fields(2) Nursing care-related field
Alps Care Heart, which provides nursing care-related services, first began in Sagamihara City, using domestic
human resources to provide home-visit nursing care services, and plans to expand its business locations to
Kanagawa Prefecture, the Tokyo metropolitan area, and then nationwide. It has been steadily increasing thenumber of locations, having opened in No.5 (Sagami-Ono) in March, No. 6 (Moto-Sumiyoshi) in May, No. 7 (Naruse)in August, and No. 8 (Minami-Osawa) in November of FY12/23, and No. 9 (Musashi-Shinjo) in January and No.
10 (Hachioji) in February of 2024.

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14 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html

Main activities and achievements

In addition, the Company made Tanpopo Shiki no Mori, which is engaged in business such elderly housingwith home-care services in Yokohama City, into a consolidated subsidiary* 1 on January 4, 2024. Starting withcollaboration with Alps Care Heart (home-visit cursing care business), it aims to generate synergies with the
futuristic serviced housing facility Fureai no Mori Sagamiko*2 currently being built and scheduled to start accepting
residents from around May 2024.
*1	The acquisition cost was ¥246mn (goodwill is undetermined at this time).
*2	Housing for the elderly with medical and nursing care services (to be operated by Alps Care Heart).

(3) Manufacturing businessSubsidiary DONKEY, which is central to the manufacturing business, is working on demonstration experiments
for small transport robots in collaboration with NTT DATA INSTITUTE OF MANAGEMENT CONSULTING, Inc.
among others, aiming to establish an integrated smart agriculture system to realize sustainable urban agriculture.
It has already started trial sales, having built up a track record in areas such as reducing work time. However, it
forecasts that moving to mass production will take more time. Its strategy is apparently to become the de facto
standard in this field by staying ahead of competitors.

■ Business outlook
Sales and profit uptrend expected to continue in FY12/24 too
1. Outlook for FY12/24
In its outlook for FY12/24, the Company forecasts the continuation of its increasing revenue and profits, with net
sales set to increase 7.1% YoY to ¥49,500mn, operating profit to rise 4.4% to ¥5,200mn, ordinary profit to increase
4.9% to ¥5,300mn, and profit attributable to owners of parent (final profit) to decrease 5.3% to ¥3,500mn. The
Company expects only final profit to decline due to temporary factors (e.g., gains on the sale of investment securities)
in the previous fiscal year dropping out.
The Company expects both sales and operating profit to grow steadily against the background of strong customer demand for semiconductors, medical-related business, and software development related to cutting-edge
technologies, for which demand is expanding. It also seems that the Company expects agriculture-related fields,
where global human resources have been increasingly accepted along with the lifting of immigration restrictions, tocontribute to earnings growth.
Outlook for FY12/24(¥mn)
FY12/23
Results

FY12/24% of sales

Forecast

Net sales

46,216

Operating profit

4,982

10.8%

5,200

Ordinary profit

5,053

10.9%

Profit attributable toowners of parent

3,696

8.0%

% of sales

49,500Change

7.1%

10.5%

217

4.4%

5,300

10.7%

246

4.9%

3,500

7.1%

-196

-5.3%

Source: Prepared by FISCO from the Company’s financial results and briefing materials

We encourage readers to review our complete legal statement on “Disclaimer” page.

15 20

Rate of change

3,283

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html

Business outlook

2. View of FISCO’s analysts
At FISCO, we believe uncertainties in the business environment, including surging raw material prices and heightened
geopolitical risk, continue to warrant sufficient caution. However, we also believe that the Company’s forecasts arewell within reach for the four following reasons. 1) The Company’s targeted R&D investment areas are long-term
investment fields that are directly connected to its future competitiveness and where strong demand is also likely
going forward. 2) It is steadily working to expand its business foundation, including through human resource
recruitment and education. 3) It is maintaining a high mobilization rate while shifting to growth fields. 4) Group
companies are all performing solidly. In addition, the pace of contributions to earnings growth going forward fromthe agriculture-related field, which has been accepting global human resources as immigration restrictions have been
lifted, as well as the nursing care business, which has entered a new domain (operation of housing with services
for the elderly) while steadily increasing the number of locations, warrants attention as factors that will additionallyaffect results.

■ Medium- to long-term growth strategy
Targeting sustainable growth by taking on new domains with
cutting-edge technologies and developing new earning pillars
1. Twelfth five-year plan (qualitative targets)
Since its foundation, the Company has been formulating qualitative targets for every five years and quantitative
targets for every three years (rolling targets in the medium-term management plan). Upon the 55th anniversary of
its foundation in July 2023, it announced the twelfth five-year plan (qualitative targets) as its vision up to 2028. With
“utilizing technology to challenge partners in a co-creative society” as the theme, it is working on the four measuresdescribed below. It aims to strengthen its foundation for sustainable growth by moving on to the next phase in thelargely unchanged course it has been charting so far. The biggest point is that the Company intends to work to
educate personnel to anticipate future needs, with an eye to new markets and services yet to be imagined beingbrought about by the development of cutting-edge technology such as that typified by generative AI, growing social
demands for environmental measures, steps towards carbon neutrality, and so forth.
• Twelfth five-year plan’s four measures
1) Take on new domains of engineering outsourcing
Develop engineers competent in state-of-the-art technologies, and take on new business and work areas unconstrained by existing boundaries.
2) Develop new earnings pillars
Aim to expand the agriculture and nursing care businesses and raise their earning capacity by strengthening
integration with technology.
3) Help create a sustainable, prosperous society
Aim to create new businesses that lead to regional revitalization, a social task, by leveraging the technologicaland personnel expertise of the Group.
4) Employ digitalization to foster an organizational culture where diverse personnel thrive
Aim to establish a framework where diverse human resources can thrive more by promoting more efficient,centralized control of management resources scattered throughout the organization.

We encourage readers to review our complete legal statement on “Disclaimer” page.

16 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html

Medium- to long-term growth strategy

2. Medium-term management plan (three-year quantitative targets)
Additionally, the Company announced three-year quantitative (rolling) targets in February 2024. It has set FY12/26
targets of net sales of ¥55,500mn, operating profit of ¥5,700mn, ordinary profit of ¥5,800, and profit attributable toowners of parent of ¥3,800mn, while it also intends to secure ROE of 20% or above.

Medium-term management plan targets
Net sales (left)
Operating profit (right)
Profit attributable to owners of parent (right)(¥mn)
60,00050,000

4,649

4,982

5,200

5,400

5,700

(¥mn)
6,000
5,000

40,0004,000

30,00020,00043,647

46,21649,50052,70055,500

3,000
2,000

10,0001,000

00FY12/22

FY12/23

FY12/24(forecast)

FY12/25(target)FY12/26(target)Source: Prepared by FISCO from the Company’s briefing materials

3. Industry trends and the Company’s position
According to the Ministry of Labor, Health and Welfare’s “Aggregated Results of Business Reports by Worker
Dispatching Businesses (Preliminary Report),” the number of assignment workers nationwide peaked at 2.02mn at
the time of the global financial crisis in 2008 and then trended downward, but this decline bottomed-out in 2013
and by 2021 had recovered to 2.09mn. Also, due to developments such as the revisions to the Worker Dispatching
Act and the introduction of the equal pay for equal work system (both enacted on April 1, 2020)*, the environment
surrounding the assignment business is approaching a major turning point. In other words, it is thought that aspects
such as the technological capabilities and expertise of the assignment employees, and what the companies that they
are assigned to expect from these employees, will change greatly in the future. Simply put, needs will be strong forhuman resources who possess new and advanced technological capabilities and expertise, but work in downstream
processes is likely to change greatly, depending on economic trends and other factors.
*	The equal pay for equal work system was introduced with the aim of eliminating the unfair differences in treatment between
so-called regular employees (permanent workers recruited for an indefinite period) and non-regular employees (employees
recruited for a fixed period, part time workers, and assignment workers) working in the same company or organization.
Generally, there are concerns about the effects of introducing this system, such as that the wages of non-regular employees
will increase and that wage differences will grow among non-regular employees.

We encourage readers to review our complete legal statement on “Disclaimer” page.

17 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html

Medium- to long-term growth strategy

In the Company, engineers have a stable position through being recruited for an indefinite period (permanent
employees), and they receive education and training to have advanced technological capabilities and expertise.
Therefore, they are trusted by customer companies. The results of the Company, which specializes in assignmentsof engineers recruited for an indefinite period, are expected to grow solidly. Of course, efforts will be needed tocapture customer needs and to undertake upstream processes in industries requiring technological capabilities andexpertise, such as the electricity and machinery, automotive, aviation and space industries. However, it is thought thatits businesses can continuously grow by gaining the trust of customers, supported by long-term human resources
education.
Also, having observed trends over several years, while the number of working hours per engineer is decreasing
due to the impact of workstyle reforms, the number of engineers being requested is increasing. In addition to
supplementing the labor shortage at manufacturers, there appears to be a distinct trend emerging where demand isincreasing not only to compensate for personnel shortages at manufacturers but also in cutting-edge technologicalareas that require skills in specific technologies. Therefore, going forward, whether the Company can acquire(develop) excellent engineers in the fields with the most cutting-edge technologies, which it has positioned as its
priority fields, is likely to become an increasingly important factor for its success in the future.
4. Medium- to long-term focal points
Amid a declining population in Japan and economic globalization, at FISCO we evaluate the Company’s strategy
for the direction of its business development, which involves ascertaining changes to the industrial structure andsocietal problems in the future, to be rational. The focus for the future will be on how to link sustainable growth withefforts to respond to new technological fields where demand is growing and to solve social issues, including the
progress made in new businesses. In particular, it seems that its success or failure in the agriculture- and nursing
care-related fields will be determined by whether the Company itself can advance ahead of other companies tocreate new markets, and whether its utilization of cutting-edge technologies and accumulation of expertise will leadto solving the labor-shortage problem and also to improving productivity (and securing profitability). Furthermore,
the manufacturing business, centered on Digital Spice and DONKEY, holds potential upside factors for businessperformance, and we intend to focus on the Company’s specific moves in this area going forward.

■ Sustainability initiatives
The Company has formulated a basic policy on sustainability andfurther strengthened its specific initiatives
1. Initiatives for SDGs
The Company’s Group supports the Sustainable Development Goals (SDGs) advocated by the United Nations andbased on its “Heart to Heart” management philosophy, it is aiming to contribute to the achievement of the SDGs
through its Outsourcing Business and other businesses, including by developing technologies.**	In August 2019, the Company newly established a page on its website to promote SDGs, while it is also listed on thewebsite of the Ministry of Foreign Affairs as a company that is promoting SDGs.

We encourage readers to review our complete legal statement on “Disclaimer” page.

18 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation
4641 Tokyo Stock Exchange Prime Market

2-May-2024
https://www.alpsgiken.co.jp/english/index.html

Sustainability initiatives

2. Establishment of a basic policy on sustainability
In November 2021, the Company established a basic policy on sustainability in order to further strengthen its
sustainability initiatives. It has also set specific indicators and publicly announces their progress. In addition, theongoing contribution to regional revitalization (Taiki-cho, Hokkaido) using the corporate version of the hometown
tax donation system* can be viewed as part of these initiatives.
*	Using the corporate version of the Hometown Tax Donation system, the Company has donated (three times since 2021)
to “From Taiki-cho! The Plan for Regional Revitalization through Aerospace Industry Accumulation” in Taiki-cho, Hokkaido.
The aerospace business is one of the fields that the Company is focusing on, and its goal is to support the developmentof business that will advance Taiki -cho, aiming to further realize regional revitalization and a sustainable society.

Basic policy on sustainability
We of the Alps Giken group will value the bonds between people based on our corporate
philosophy, “Heart to Heart.” Through our business activities, we will aim to realize asustainable environment and society, and sustainably increase our corporate value.
1. We will strive to preserve the global environment by providing advanced and diverse
technology services.
2. We will utilize our management resources, namely human resources and technologicalcapabilities, to engage in solving various social issues.
3. As a good corporate citizen, we will cooperate with stakeholders to engage in social
contribution activities.
Source: Prepared by FISCO from the Company’s website

Status of key benchmarks

Source: From the Company’s results briefing materials

We encourage readers to review our complete legal statement on “Disclaimer” page.

19 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Altech Corporation

2-May-2024

4641 Tokyo Stock Exchange Prime Market

https://www.alpsgiken.co.jp/english/index.html■ Shareholder return policy
Aims for a dividend payout ratio of 50% on a consolidated basis.
Plans to pay an annual amount of ¥88 in FY12/24
1. Basic dividend policy
The Company pays dividends as its policy to return profits to shareholders. It aims for a dividend payout ratio on aconsolidated basis of 50% (of which, the interim dividend is 50% of the annual dividend), and its basic policy is to
pay an annual dividend of ¥10, regardless of results.
2. Dividend trend and plan
For dividends per share in FY12/23, the Company increased ordinary annual dividends by ¥8 from FY12/22 to ¥93,and paid a commemorative dividend of ¥10 for total annual dividends of ¥103 (interim dividend ¥52, period-end
dividend ¥51; a dividend payout ratio of 55.6%).
For dividends per share in FY12/24, the Company forecasts ordinary annual dividends of ¥88 (interim dividend ¥44,
period-end dividend ¥44; a dividend payout ratio of 50%).

Dividend and dividend payout(¥)

Ordinary dividend (left)
Dividend payout ratio (right)

Commemorative dividend (left)

120.00(Commemorative dividend on the 55th
anniversary of its foundation)

90.0%

100.00

10.00

75.0%

80.00

55.6%
50.3%

50.3%

50.0%

50.2%

60.00

60.0%
45.0%

40.00
75.00

76.00

85.00

93.00

88.00

20.00

30.0%
15.0%

0.00

0.0%
FY12/20

FY12/21

FY12/22

FY12/23

FY12/24 E

Source: Prepared by FISCO from the Company’s financial results

We encourage readers to review our complete legal statement on “Disclaimer” page.

20 20

Disclaimer
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◾ For inquiry, please contact: ◾

FISCO Ltd.
5-13-3 Minami Aoyama, Minato-ku, Tokyo, Japan 107-0062
Phone: 03-5774-2443 (IR Consulting Business Division)
Email: support@fisco.co.jp