KAGA ELECTRONICSCO., LTD.

For Institutional Investors/Analystssts

Consolidated Financial Results
for the First Quarter of theFiscal Year ending March 2022
KAGA
ELECTRONICS CO., LTD.
加賀電子株式会社
August 5, 2021

TSE 1st section 8154

Summary of Financial Results
for the First Quarter Ended June 30, 2021

FY2022/3
1Q Results

Overview ofthe mainsegments

Outlook for
FY2022/3

 Net sales increased, driven by the electronic components business as
manufacturing activity recovered.
 Operating income and ordinary income increased significantly, thanks
to higher gross profit resulting from higher sales, as well as efforts to curb
SG&A expenses with more efficient operations. Both operating income
and ordinary income reached record highs for a first quarter.
 Net income for the quarter decreased due to the absence of the 7.96
billion yen “gain on bargain purchase” resulting from the acquisition ofcompanies and posted as extraordinary income in the previous fiscal year.
・ The components sales business was solid owing to a recovery
in demand in a broad range of areas, despite shortages inElectronic
the supply of some components.
Components ・ In the EMS business, sales in the automotive, industrial
equipment, and medical product areas were solid.
・ Sales of PCs to educational institutions and sales of PC
Information peripheral equipment such as security software were strong.
・ Sales declined due to the impact of a reactionary drop in theEquipment
sale of PCs for remote work and delays to construction work in
the LED installation business due to customers' situations.
 While the first quarter got off to a strong start that exceeded initial
forecasts, we take a cautious view of the uncertain business environment,such as semiconductor shortages and the impact of COVID-19, and haveleft our earnings forecasts previously announced unchanged.
 In the final year of our Medium-Term Management Plan, we are targeting
record high for operating income for the third fiscal year in a row andthe achievement of the Medium-Term Management Plan’s targets.
1

Financial Highlights for FY2022/3 1Q（million yen）

FY2021/3
1Q Results

FY2022/3
1Q Results

YoY

84,130105,949

Gross Profit

9,997 11.9%

13,550 12.8%

SG&A

8,341

9.9%

9,098

Operating income

1,656

2.0%

Ordinary income

1,533

Profit attibutable toowners of parent

Net Sales

EPS（yen）
Exchange Rate

USD

Progressrate

FY2022/3
Forecasrt（announced on May 13, 2021）

25.9%

470,000

35.5%

--

-

8.6%

9.1%

--

-

4,452

4.2%

168.8%

13,000

2.8%

34.2%

1.8%

4,566

4.3%

197.8%

12,000

2.6%

38.1%

8,598 10.2%

2,872

2.7%

-66.6%

8,000

1.7%

35.9%

313.15-104.55--291.20-107.62-109.49--110.50-22.5%

Note: The Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020), etc. wasapplied from the beginning of FY2022/3 1Q.
As a result, compared to the previous method, in this 1Q, net sales decreased by 1,577million yen.
Operating income, ordinary income, and profit before income taxes also decreased by 12million yen each.

2

Financial Results by Business Segment for FY2022/3 1Q（million yen）

FY2021/3

FY2022/3

1Q Results

1Q Results

Net sales
Electronic
Component Segment income

68,196

Information Net sales
Equipment Segment income

12,537

SoftwareOthers

Total

1,185583

Net sales

491

Segment income-44

Net sales2,904

Segment income-101

90,624
1.7%

Segment income

1,656

3,699

32.9%
4.1%

10,636
4.7%

568

-9.1%

-67

5.3%

217

-11.8%

4,452

41.9%

5.3%

105,949
2.0%

-2.6%
15.5%

4,120
-3.5%

212.0%-15.2%

568

84,130Net sales

YoY

25.9%

4.2%

168.8%

Note: Figures of each segment income are not inter-segment adjusted.
Total amount is inter-segment adjusted (operating income).

3Effect of M&A (FY2022/3 1Q Results)※ FY2021/3 1Q results of EXCEL do not include results of group companies whose accounting period ends in December.

Net Sales

Gross profit / Gross profit margin

Sales increased for all three companies; in FY2021/3 1Q,
EXCEL's overseas subsidiaries were not consolidated.

Income was up owing to higher sales andimproved profit margin.

84,130+7,621+2,973+11,223 105,949

9,997
14.2%

+2,146

Kaga
Electronics

Kaga
FEI

Excel

FY2022/3

2022/3
1Q

2021/3
1Q+849

13,550

16.0%

12.8%
9.4%

9.3%
8.0%
2021/3
1Q+680

7.9%
KagaElectronics

Kaga
FEI

Excel

2022/3
1Q

FY2022/3

SG&A / SG&A ratio

Operating income / Operating income marjin

Although SG&A expenses rose as sales increased,
the SG&A ratio was kept down.

The profit margin improved significantly for
Kaga Electronics.
Kaga FEI and EXCEL returned to the black.

8,341
16.4%
10.7%
8.0%
2021/3
1Q

+342

+275

+138

9.9%

+1,848
9.1%

8.1%
Kaga
Electronics

9,098

Kaga
FEI

FY2022/3

1,656
3.6%

6.2%

2022/3
1Q

2021/3
1Q

Kaga
Electronics

4,452

4.2%
1.1%

4.0%
Excel

+365

+705

Kaga
FEI

FY2022/3

3.7%
Excel

2022/3
1Q

Note :With respect to gross profit and operating income, figures presented above are before consolidation
adjustments between the two companies. For reference, after consolidation adjustments, gross profit
stood at -126million yen, and operating income came to -121million yen.

4

Reference

Effect of M&A (FY2022/3 1Q Results)(After adjustment of results of EXCEL's overseas subsidiaries)

EXCEL, which was consolidated in April 2020, hasoverseas subsidiaries that conduct settlement in December.
The results for FY2021/3 1Q (January to March 2020)
have not been included, as this was prior to consolidation.
This page is a reference information created using
figures calculated on a non-consolidated basis for theaforementioned overseas subsidiary for EXCEL's FY2021/3
1Q, in order to conduct a realistic comparison of profit
margin and SG&A ratio.
The results of the overseas subsidiaries for the relevant
period are as follows.
・Net Sales
9,281 million yen
・Gross profit
427 million yen
・SG&A
405 million yen
・Operating income
22 million yen

SG&A / SG&A ratio

8,341+342+275+138

Gross profit / Gross profit margin

9,997+2,146+680+849

12.8%
7.9%

5.6%
2021/3
1Q

Kaga
Electronics

Kaga
FEI

Excel

FY2022/3

9,098+1,848+365+705

1,656

Kaga
Electronics

Kaga
FEI

FY2022/3

Excel

2022/3
1Q

4,452

4.2%
3.7%

4.0%
2021/3
1Q

13,550Operating income / Operating income marjin

9.1%

6.9%

(Million Yen)

2022/3
1Q

2021/3
1Q

Kaga
Electronics

Kaga
FEI

FY2022/3

Excel

2022/3
1Q

Note :With respect to gross profit and operating income, figures presented above are before consolidation
adjustments between the two companies. For reference, after consolidation adjustments, gross profit
stood at -126million yen, and operating income came to -121million yen.

5FY2022/3 1Q Results by company(million yen )KagaElectronics

KagaFEI

Excel

Total

FY2021/3

FY2022/3

1Q Results

1Q Results

YoY

60,115Net sales

52,493Gross Profit

7,442

14.2%

9,588

16.0%

28.8%

operating income

1,870

3.6%

3,719

6.2%

98.8%

14.5%

32,145Net sales

29,172Gross Profit

2,328

8.0%

3,009

9.4%

29.2%

-18-0.1%

346

1.1%

-operating income

10.2%

13,688Net sales

2,464

Gross Profit

230

9.3%

1,079

7.9%

369.0%

operating income

-198

-8.0%

507

3.7%

-455.5%

105,949

Net sales

84,130Gross Profit

9,997

11.9%

13,550

12.8%

35.5%

operating income

1,656

2.0%

4,452

4.2%

168.8%

25.9%

Note: 1.With respect to gross profit and operating income, figures presented above are before consolidation adjustments
between the three companies.
2. FY2021/3 1Q results of EXCEL do not include results of group companies whose accounting period ends in December.

6Financial Highlights: Electronic Component Segment（million yen）

Net sales/Segment income
106,750/ Net Sales/ Segment incomeYoY Net Sales
500 0100 000
450 090,624
3,699

400 0800 00

350 0

68,196
2,732

300 0

600 00+22,427million Yen 32.9％Up
 Segment income +2,514million Yen 212.0％UP
The components sales business was solid owing
to a recovery in demand in a broad range ofareas, despite shortages in the supply of somecomponents.
Adjustments in the financial periods of theoverseas subsidiaries of EXCEL, acquired in theprevious fiscal year, had the effect of boostingsales.

250 0

200 0400 00

1,185150 0

100 0200 00

5000The EMS business remained firm in categories
such as automotive, industrial equipment, andmedical products.

QoQ-16,126million Yen15.1％Down
 Segment income +967million Yen 35.4％UP
 Net Sales

0

FY2021/3
1Q Results

FY2021/3
4Q Results

FY2022/3
1Q Results

7

Financial Highlights: Information Equipment Segment（million yen）

Net sales/Segment income
14,451//140 00

YoYNet SalesSegment income

300 012,537

250 0120 00

10,636200 0100 00

150 0800 0100 0

600 0583

728

568-1,901million yen 15.2％Down
 Segment income -14million yen 2.6％Down
The sale of PCs to educational institutions andthe sale of PC peripheral equipment such as
security software remained solid, despite thereactionary decline in PCs for remote work.
Sales fell in the LED installation business due
to delays in construction schedules
attributable to customers' situations, among
other factors.

QoQ-3,815million yen 26.4％Down
 Segment income -160million yen 22.0％Down
 Net Sales500

400 0200 0

 Net Sales0FY2021/3
1Q Results

FY2021/3
4Q Results

FY2022/3
1Q Results8Balance Sheet Main Items(Million Yen)

Total assets
237,004
207,638

200,179
174,331

Total liabilities and net assets

228,819-8,185

191,834

33,3062020/32021/3228,819

141,942

131,738

207,638

Current assets

121,388-8,185

Total liabilities-10,204-8,34486,25036,825

237,004

36,984

95,062

97,081

Total net assets+2,018Non-current assets+159

2021/62020/32021/32021/69

Balance Sheet Main Items（million Yen,day）

Inventories

Accounts receivable/Accounts payable
93.7

160 ,000
70, 000

60, 000

26.3

32.8

42.9

Inventory turnover

49,985120 ,000

100 ,000

31,908A/P turnover

79.8
64.6

0.0

40, 000

80. 0

140 ,000

60. 0+12,03750, 000

A/R turnover

79.0

75.2

50. 0

100 .037,948108,394

92,012

91,37180, 000

40. 0-16,381

79,854
-50.0

60.9

20. 0

70,874-8,97970,1880.0

30, 000

Notes and A/R

60, 000

Inventories

20, 000-20.0

40, 000-100.0-40.0

Notes and A/P

10, 000

20, 000-60.00-150.0-80.002020/32021/3

2021/6

Note：Inventory turnover ＝ Inventories ÷ Net Sales × 91（day）

2020/32021/32021/6

Notes：・Notes and A/R are amounts including Electronically recorded monetary claims-operating
・Notes and A/P are amounts including Electronically recorded obligations - operating
・A/R turnover ＝ Notes and A/R ÷ Net sales × 91（day）
・A/P turnover ＝ Notes and A/P ÷ Total purchase of goods × 91（day）

10

Balance Sheet Main Items（million yen）

Cash and Deposits/Interest Bearing Debt
70, 000

0.37

0.42

0.43（times）
0.5 0

D/E ratio
60, 000-0.19

50, 000

43,384

-0.08

0.0 0

45,63638,26140, 000-0.00
Net D/E ratio-0.50

Cash and deposits

40,239-5,397-1.00

39,997+1,73530, 000

28,736-1.50

Interest bearing debts
20, 000-2.00

10, 000-2.50

0-3.002020/32021/32021/6

Note：D/E ratio＝ Interest bearing debts ÷ Shareholder’s equity
Net D/E ratio ＝（Interest bearing debts - Cash and deposits） ÷Shareholder’s equity

11Forecast for the Fiscal Year ending March（Announced on May 13, 2021)（million yen）

FY2021/3
Results
Net salesFY2022/3
Forecast

470,000

422,365

Management

YoY

Targets FY2022/3

11.3%

500,000

Operating income

11,4672.7%

13,000

2.8%

13.4%

13,000Ordinary income

11,241

2.7%

12,000

2.6%

6.7%

ーProfit attributable toowners of parent

11,399

2.7%

8,000

1.7%

-29.8%ーEPS（Yen）

415.07291.20

ー

ーROE

13.5%

8.5%

-5.0pt8.0%

or higher

Note: The Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020), etc. isapplied from the beginning of FY2022/3 1Q, and thus the above consolidated earnings forecasts are
figures after this accounting standard, etc. has been applied.

12Forecasts for FY2022/3 by Segment（million yen）

FY2021/3

FY2022/3

Results

Forecasts

Net sales
Electronic
components Segment income

353,454

Information Net sales
equipment Segment income

48,389Software

OthersTotal

Net sales
Segment income
Net sales
Segment income
Net sales
Segment income

8,151
2,482

404,000
2.3%

5.1%

9.0%

2,300
300

2.7%

500

5.1%

13,000

-7.3%
2.3%

10.0%

13.9%
2.3%

2.8%

470,000
2.7%

21.5%
-7.0%

18,000422,365
11,467

2.5%

3,000

17,589
474

9,900

14.3%

45,000

2,932
263

YoY

5.4%
11.3%

2.8%

13.4%

Note: Figures of each segment income are not inter-segment adjusted. Total amount is inter-segment
adjusted (operating income).

13Reference

Segment disclosure associated with the Medium-Term
Management Plan

Continuous disclosure based on current segmentation according to legal financial accounting,along with voluntary disclosure based on segmentation in line with the new Medium-Term
Management Plan

Current segments

Segments in Medium-Term Management Plan

Legal financial accounting

Management AccountingComponents sales businessElectronic
components

 Sales of semiconductors
 Sales of general electronic
components
 Sales of various kinds ofdevices

EMS business Electronic equipment
manufacture contracting
services

Informationequipment

 Sales of PCs and PC
peripherals
 Sales of home electric
appliances and lighting fixtures
 Sales of photograph andimaging products

Software Production of CG video andsoftware

Others Sales of amusement
equipment Repair and support forelectronics equipment
 Sales of sports goods

Electroniccomponents

 Sales of semiconductors
 Sales of general electroniccomponents
 Sales of various devices

EMS

 Electronic equipment manufacture
contracting services

CSI

 Sales of PCs and PC peripherals
 Sales of home electric appliancesand lighting fixtures
 Sales of photograph and imaging
products

CSI: Consumer & System Integrator

Others Production of CG video andsoftware
 Sales of amusement equipment
 Repair and support for electronicsequipment
 Sales of sports goods
14

Reference

Business segments of Parent company andGroup companies

KAGA ELECTRONICS CO., LTD.

Electronic
Components

Electronics Business Division
EMS Business Division
Communication Network Sales Division
Specific Industry Business Division
Sales Promotion Division●KAGA TECH CO., LTD.
KAGA DEVICES CO., LTD.
KAGA SOLUTION NETWORK CO., LTD.
AD DEVICE CO., LTD.
KAGA MICRO SOLUTIONCO., LTD.
DIGITAL MEDIA LAB., INC.
KAGA SPORTS CO., LTD.
KAGA AMUSEMENT CO., LTD.
KAGA TECHNOSERVICE CO., LTD.
KAGA FEI CO., LTD.(former:FUJITSU ELECTRONICS INC.)
KAGA EMS TOWADA CO., LTD.
EXCEL CO., LTD.
KYOKUTO ELECTRIC CO.,LTD.

●●

Major Affiliates in Japan

●●●●

●
●

Major Affiliates Overseas

KAGA TAXAN (SUZHOU) ELECTRONICS CO., LTD.
KAGA (SHANGHAI) ELECTRONICS CO., LTD.
KAGA (SHENZHEN) ELECTRONICS CO., LTD.
KAGA (H.K.) ELECTRONICS LIMITEDKAGA DEVICES (H.K.) LIMITEDKAGA (TAIWAN) ELECTRONICS CO., LTD
KAGA ELECTRONICS (THAILAND) COMPANY LIMITEDKAGA COMPONENTS (MALAYSIA) SDN.BHD.
KAGA ELECTRONICS INDONESIA, PT
KAGA ELECTRONICS (VIETNAM) CO., LTD.
KAGA (SINGAPORE) ELECRONICS PTE LTD
KAGA ELECTRONICS (USA) INC.
TAXAN MEXICO S.A. de C.V.
KD TEC s.r.o.

(●)
●
●
(●)
●
●
●
●

EMS

CSI

Others

●●
●
●

(●)

●

●
(●)

(●)
●

(●)
●

(●)
●
●

(●)
●

●

(●)

●
●
●
●

●●●●
●
●
●
(●)
●
●
●
●
(●)
●
●
●

(●)

15

Reference

Financial Highlights by Business Segment ofthe Medium-Term Management Plan（million yen）

CSIOthers

Total

FY2021/3

FY2022/3

1Q Results

1Q Results

1Q Results

72,10549,740475

4424,52019,820

1,269

1,083

10,126

12,537

188583

Net sales

2,812

2,031

Segment income-114-89

109,564

84,130

1,850

1,656

Net sales
ElectronicComponens
Segment income
EMS

FY2020/3

Net sales
Segment income
Net sales
Segment income

Net sales
Segment income. 1%. 5%. 7%. 4%. 0%

YoY

66,124

32.9%

1,775

-

26,334

32.9%

2,060

90.1%

10,636-15.2%

568

-2.6%

2,854

40.5%

14-

105,949

25.9%

4,452

168.8%

Note : Figures of each segment income are not inter-segment adjusted.
Total amount is inter-segment adjusted (operating income).

16Reference

17Quarterly Net Sales Trends（million yen）

Net
売上高
Sales
Total

128,099

104,729
84,1302,904
491
12,5374,600
783
10,654105,406
4,114
730
10,745

5,969
927
14,451

YoY
QoQ：：+21,819-22,149

105,949
4,120
56810,636

Other
YoY ：+1,216

QoQ ：-1,848

Software
YoY ：
QoQ ：

106,750
88,690Information equipment

90,62489,816＋76-359

YoY ：
QoQ ：

-1,901-3,81568,196
Electronic equipment
YoY ：
QoQ ：

FY2021/3
1Q Results

FY2021/3
2Q Results

FY2021/3
3Q Results

FY2021/3
4Q Results＋22,427-16,126

FY2022/3
1Q Results

18Quarterly Segment Income Trends（million yen）

Segment Income
4,452
3,950
325

2,778
137
131

1,656

3,082
112
20217

156728FY2021/3
1Q Results：：+2,796+502

Other+319-108：：-14-160

Electronic equipment
YoY
QoQ

2,732：：+2,514+967

Software
YoY
QoQ

1,185-44-101

YoY
QoQ

YoY
QoQ

3,699

1,897：：

Information equipment

577

2,335

YoY
QoQ

568

592

583

Total：：-22-223-67
FY2021/3
2Q Results

FY2021/3
3Q Results

FY2021/3
4Q Results

FY2022/3
1Q Results

Note: Figures of each segment income are not inter-segment adjusted.
Total amount is inter-segment adjusted (operating income).

19

Net Sales by Region（million Yen）

Net Sales

YoY Japan

128,099＋1,767 million Yen

3.3％Up＋35 million Yen

0.5％Up North America
 Europe105,949

 Asia＋2,021 million Yen 106.7％Up＋17,994 million Yen

84,13083.8％Up

72,142 [56.3%]
55,101[52.0%]

53,334［63.4%］

5,276 [4.1%]
3,467 [2.7%]

7,454 [7.0%]
3,915 [3.7%]

7,419 ［8.8%］
1,894 ［2.3%］ 47,212 [36.9%]

FY2021/3
4Q Results

North America

Europe39,477 [37.3%]

21,482［25.5%］
FY2021/3
1Q Results

JapanQoQ-17,040 million Yen 23.6％Down
41.3％Up North America＋2,177 million Yen Japan Europe Asia

＋447 million Yen

12.9％Up-7,734 million Yen 16.4％Down

Asia

FY2022/3
1Q Results

20

Exchange Rate/FOREX Sensitivity（Reference）

Effect of 1% change（million yen）

Forex
Assumptionfor2022/3(yen)FY2021/3
1Q Results

FY2022/3
1Q Results

Net Sales

USD

107.62109.49152

9110.50

THB

3.37

3.50

46

3

3.50

RMB

15.60

16.36

61

2

15.50

HKD

13.89

14.10

56

2

14.00

（yen）

（yen）

Ordinaryincome

21

“Everything we do isfor our customers
20 Kandamatsunagacho, Chiyoda-ku, Tokyo 101-8629
Contact: Investor Relations & Public Relations Office
TEL:+81-3-5657-0106
FAX:+81-3-3254-7133
E-mail： webmaster@taxan.co.jp
https://www.taxan.co.jp

■ Forward-looking statements in these materials are based on information available to management
at the time this report was prepared and assumptions that management believes are reasonable.
Actual results may differ significantly from these statements for a number of reasons.
■ Display method in this material
Number : Truncated less than the display unit.
Ratio: After calculation in yen units, Round down one digit of Display unit.