Briefing Materials on the Financial
Results for the First Half of the YearEnding March 2024
November 6, 2023

SANSHIN ELECTRONICS CO., LTD.
Toshiro Suzuki, Representative Director, COO-1-[SANSHIN CONFIDENTIAL]

Business Activities
As a general electronics trading company committed to being “customers’ best partner,”
Sanshin Electronics runs two major businesses: device business and solution business.
Device Business― Addressing diversified market needs through a wide product lineup ―We cover a wide array of manufacturers, from both domestic and overseas
major semiconductors/electronic parts makers all the way to emerging
manufacturers that are currently developing products with excellent
performance. In a time when market needs are constantly diversifying, we
respond to our customers’ requests through a full lineup and detailed systemof both domestic and overseas sales.

Solution Business― Building up social infrastructures interconnected through ICT ―With information and telecommunications network at the core of ouroperations, we are committed to proposing and building up the optimal
system to fit our customers’ needs. We provide our customers with asafe and reliable infrastructure through bundled services, including a
support menu, after the system implementation.

-2-[SANSHIN CONFIDENTIAL]

I. Year Ending March 2024
Performance Summary for the First Half

-3-

[SANSHIN CONFIDENTIAL]

First Half of the Year Ending March 2024
Consolidated Performance Summary(Unit: ¥100 million)■ Net sales were down 10% year-on-year and profit declined but more than forecast.
03/23 1st Half 03/24 1st Half
ResultResultNet Sales
Gross Profit on Sales
SG&A Expenses
Operating Profit
Ordinary Profit

829.9
11.0%

Exchange Rate
(1 US dollar)

Forecast*

Achievement
Ratio

743.1

90%

736.0

101%

77.3

84% Not announced

－

48.9

－

10.4%
91.7

5.9%

6.6%
49.2

21.6
¥30

12.9
¥35

99% Not announced
2.3%
67%
17.0
1.7%
64%
12.6
1.3%
60%
9.3
+¥5
¥35

¥133.98¥141.00¥7.02 Not announced

5.1%

3.8%
42.5

3.5%

28.4
2.5%

29.3

2.6%
Net Profit Attributable to
Shareholders of Parent Company
Interim Dividend Per ShareYoY Change

18.8
1.7%

167%
149%
139%
±¥0
－

*Forecast figures announced in the Summary of Financial Results for Fiscal Year Ended March
31, 2023 (announced on May 11, 2023, before the upward revision of October 20, 2023)-4-[SANSHIN CONFIDENTIAL]

First Half of the Year Ending March 2024
Year-to-Year Comparison of Consolidated Ordinary Profit● Decrease in gross profit Approx. ¥0.94 bn*
Decrease in net sales in the device business segment
and conclusion of some high-margin projects

Ordinary
Profit¥2.93 bn

● Increase in interest expenses
Approx. ¥0.11 bn*

Decrease of approx. ¥1.05 bn

03/23 1st Half
Result*Per accounting standards, the difference between the month-end exchange rate andthe average exchange rate is shown in both denominations in the profit and loss
statement. However, in the above figure, the difference is offset by gross profit andnon-operating profit and loss, and the actual increase or decrease is shown.
-5-

Ordinary
Profit¥1.88 bn

03/24 1st Half
Result[SANSHIN CONFIDENTIAL]

First Half of the Year Ending March 2024
Consolidated Performance Summary by Segment (Unit: ¥100 million)■ Device Business
Withdrawal from some high-margin projects and an increase in non-operating expenses impacted earnings.
■ Solution BusinessA recovery keynote continued overall, paced by projects related to information and communication networks for companies.
03/23 1st Half 03/24 1st Half
ResultResultNet Sales
DeviceBusiness

Operating Profit
Segment
Profit777.5

Solution
Business

Operating Profit
Segment
ProfitExchange Rate
(1 US dollar)

676.9

87%

26.9

61%

26.6

13.2

50%

52.4

66.2

126%

7.3

162%

2.8

5.6

200%

¥133.98¥141.00

¥7.02

5.7%

4.0%
44.4

3.4%

Net Sales

YoY Change

2.0%

8.6%

11.0%
4.5

5.3%

8.5%

-6-

[SANSHIN CONFIDENTIAL]

First Half of the Year Ending March 2024
Year-to-Year Comparison of Consolidated Net Sales (Unit: ¥100 million)-13%

By Business Category of Device Business

777
677
Strategic Device

245
233

Core Device

244
225

Volume Business【Year-to-Year Comparison of Fluctuations】■ Volume Business (down 24% YoY)
● Decrease for mobile devices● Decrease for social infrastructure■ Core Device (down 8% YoY)
● Decrease for industry, vehicle-mounted business, and storage, etc.
■ Strategic Device (down 5% YoY)
● Decrease in wireless merchandise/analog semiconductors, etc.
● Decrease in modular products

288
219

03/23 1st Half

03/24 1st Half
-7-

[SANSHIN CONFIDENTIAL]

First Half of the Year Ending March 2024
Year-to-Year Comparison of Consolidated Net Sales (Unit: ¥100 million)-13%

By Supplier of Device Business

777
Other

115

677
67

Overseas
Manufacturers

321
316

ElectromechanicalParts Manufacturers

341

03/23 1st Half

【Year-to-Year Comparison of Fluctuations】■ Electromechanical Parts Manufacturers (down 14% YoY)
● Decrease for mobile devices■ Overseas Manufacturers (down 2% YoY)
● Decrease in wireless merchandise/analog semiconductors, etc.
● Decrease in modular products■ Other (down 42% YoY)
● Decrease for social infrastructure294

03/24 1st Half
-8-

[SANSHIN CONFIDENTIAL]

First Half of the Year Ending March 2024
Year-to-Year Comparison of Consolidated Net Sales (Unit: ¥100 million)+26%

By Sector of Solution Business
66.2
10.0

52.4
Video Systems

8.3

AP Software

12.8

Embedded Systems

Public Systems

14.8■ NW (up 73% YoY)
〇 Increase due to favorable trend in large and medium-scale network
projects■ Public Systems (up 34% YoY)
〇 Increase in public PC bidding projects

12.5

12.7

11.1

● Slight decrease under the impact of projects brought forward in theprevious period■ AP Software (up 16% YoY)
■ Video Systems (up 20% YoY)
〇 Favorable trend in projects for video transmission equipment

10.3
03/23 1st Half

■ Embedded Systems (down 2% YoY)

〇 Increase due to favorable trend in software development projects

8.3
17.8

NW

【Year-to-Year Comparison of Fluctuations】

03/24 1st Half

-9-

[SANSHIN CONFIDENTIAL]

First Half of the Year Ending March 2024
Consolidated Financial Situation(Unit: ¥100 million)■ Regarding the results of the term ended September 30, 2023, total assets were ¥89.9 bn (up ¥11.3 bn from the end of the previous fiscal year), mainly due
to increases in accounts receivable–trade and inventories.
■ The increase in net assets was due to increases in earnings and in exchange-rate adjustments due to depreciation of the yen.
■ Equity ratio declined from the end of the previous fiscal year (-2.8 points) but maintained a level of 40%.
■ A decrease in cash flow from operating activities (-¥5.1 bn) resulted from increases in accounts receivable–trade and inventories. The Company
responded with bank borrowing and withdrawals of cash and deposits on hand.
1) Balance Sheets
2) Cash FlowsFY EndedMar. 22
Result (A)FY EndedMar. 23
Result (B)

93.1

88.9

-4.1

69.9

-19.0

358.7

372.6

14.0

454.8

82.2

Inventories

197.3

250.0

52.7

275.5

25.4

Other assets

79.0

74.4

-4.6

99.2

24.8

Total assets

728.1

786.0

57.9

899.4

113.4

Operating C/F

144.6

138.6

-6.0

169.6

31.0

Investing C/F

Cash and deposits
Accounts receivable

Accounts payable
Interest-bearing
liabilities

B-A
Increase/
Decrease

Q2 Ended
Sept. 23
Result (C)C-B
Increase/
Decrease

244.3

268.3

24.0

326.0

57.7

Other liabilities

32.4

36.6

4.2

38.5

1.9

Total net assets

306.8

342.5

35.7

367.3

24.8

Total liabilities
and net assets

728.1

786.0

57.9

899.4

113.4

Equity ratio

42.1%

43.6%

1.5%

40.8%

-2.8P

Exchange rate at end of period

US$1 = ¥133.54

FY Ended Mar. FY Ended Mar. H1 Ended Sept.
22 Result
23 Result
23 Result
Decrease (increase) in
accounts
receivable-trade
Decrease (increase) ininventories
Increase (decrease) in
accounts
payable-trade

-0.1

7.9

-46.9

-45.6

-44.7

-10.9

2.3

-16.9

14.7

65.3

46.0

-7.4

21.9

-7.8

-50.5

-1.5

-0.5

0.5

-185.9

2.6

28.4

3.1

1.5

2.6

-162.4

-4.1

-19.0

93.1

88.9

69.9

Other

Financing C/F
Foreign currency
conversion
adjustments
Increase (decrease) in cash
and deposits
Balance of cash and deposits
at term-end

US$1 = ¥149.58- 10 -[SANSHIN CONFIDENTIAL]

Ⅱ. Progress of the V73 MediumTerm Management Plan

- 11 -[SANSHIN CONFIDENTIAL]

Overview of the V73 Medium-Term Management Plan
1. Improving profitability through business structure reform and expanding business in growth markets■ Device business: Expand existing businesses and improve profitability, and establish a new profit structure (reform our businessportfolio)■ Solution business: Grow the business based on service provision, expand our digital technology, and expand our customer platform

2. Improving capital efficiency■ Continue to target a dividend payout ratio of around 50% on a consolidated basis, and improve capital efficiency throughmeasures such as reducing total assets■ Maintain financial soundness and ensure the mobility and stability of fund procurement

3. Strengthening corporate governance■ Strengthen efforts to address issues related to sustainability, and strengthen the functions of the Board of Directors for
executing measures in the Medium-Term Management Plan

Quantitative targets for the final year of
V73(fiscal year ending March 31, 2024)

ROE

Maintain 6% or higher during V73

Ordinary profit¥2.5 bn or higher

Net profit attributable to shareholdersof parent company¥1.8 bn or higher- 12 -[SANSHIN CONFIDENTIAL]

Overview of V73 Medium-Term Management Plan (Quantitative Targets)
11.8%
7.2%

6.8%
3.9%

3.4%

2.8%

ROE
6% or more

3.4%

2.9%

2.2%

1.7%

1.5%

1.2%

1,611
1,479

1,231

1,236

1,128

35.6

55.1
38.3

03/19 Term

35.0
26.0

Ordinary profit¥2.5 bn or more

18.8

18.6
14.5

Net sales(Unit: ¥100 million)

1,570

25.3
17.4

ROS

14.5
03/20 Term

Net profit¥1.8 bn or more

16.5
03/21 Term

03/22 Term

- 13 -

03/23 Term

03/24 Term

[SANSHIN CONFIDENTIAL]

V73 Medium-Term Management Plan: List of Progress for Priority Measures
Measures of MediumTerm Management Plan

Expand existing
businesses andimprove
profitability

Device Business
Establish new
profit structure(reform portfolio)

Contents of Measures

Targeted Effect and Progress Status(1) Shift resources to overseas semiconductors(2) Acquire new customers through merchandise from existing
suppliers(3) Improve the efficiency of expanding sales by reorganizing theorganization by customers (especially major corporations) andbusinesses(4) Promote the increased efficiency of sales activities
・ Improvement/new introduction of sales support systems,
maintenance of operation systems

Targeted Effect・ Increase net sales of overseas semiconductor
manufacturers
・ Increase segment profit to net sales
Progress Status: Excellent
・ Expanded net sales of overseas semiconductor
manufacturers
From ¥21.9 bn in 03/21 term to ¥61.8 bn in 03/24
term (forecast)・ To streamline operating activities, we are launching
operation of parts management/new businessnegotiation system and developing a budgetingsystem.
Targeted Effect・ Acquire customers in new markets (including nonelectronics)
・ Acquire highly-profitable businesses
・ Improve segment profit to net sales
Progress Status: Good・ Expanded order acceptance through a reservoir
solution for local governments; agreement
concluded with Tottori Prefecture
・ Aiming to improve profitability in the robotics
field, we are concluding agreements with
consultants and launching collaborative operations.

(1) Focus on provision of total solutions (AI/IoT, robotics)(2) AI/IoT related
・ Enhance approaches to local governments through reservoir
and river monitoring solutions with added value(3) Robotics field・ Focus on new development by strengthening cooperation withcollaborative partners and interdepartmental cooperation(4) Vehicle-mounted field・ Use proposal-based software (including wireless modules andsecurity products) as the key to formulate a new strategy in theexisting organization (automotive department)- 14 -[SANSHIN CONFIDENTIAL]

V73 Medium-Term Management Plan: List of Progress for Priority Measures
Measures of MediumTerm Management Plan

Grow businessbased on service
provision

Solution Business

Expand digitaltechnology

ExpandcustomerplatformContents of Measures

Targeted Effect and Progress Status(1) Establish a service provision model utilizing mega cloud (AWS,MS Azure, etc.) infrastructure(2) Expand Sanshin Data Center business(hosting + operation maintenance, cloud connection service)(3) Expand general-purpose cloud services(enhance services such as cloud backup and cloud security)(4) Expand subscription business by improving service menu

Targeted Effect
Secure and expand stable stock earnings
Progress Status: Fair
Aiming to expand order acceptance through proposals toprovide SaaS optimized for customer environments andby partnering with vendors
Striving for stable earnings by supporting utilization
rates at Sanshin Data Center and reducing costs(1) Respond to evolving security technology
・ Implement proposal of security model based on Zero Trust concept
・ Strengthen response to SASE technology(2) Acquire new infrastructure technology(SD-WAN, WiFi6, 5G, private LTE, etc.)

Targeted Effect
Increase sales in the solution business
Progress Status: Excellent
Expanding proposal activities utilizing advanced
technologies (SASE, 5G)(1) Discover new merchandise in collaboration with external
consultants, expand free promotional merchandise(2) Acquire new customers through collaboration with partners(3) Promote cross-sales through cooperation inside of divisions(4) Develop new markets for existing products such as mobile relay
equipment(5) Incorporate DX demand

Targeted EffectExpand business domains and identify new revenue
sources
Progress Status: Good
Aiming to contribute to earnings from the next fiscal
year onwards by expanding contracts with new suppliers
and starting initiatives for SDGs
Currently acquiring new customers across different
businesses through the promotion of cross-sales bystrengthening pre-sales- 15 -[SANSHIN CONFIDENTIAL]

V73 Medium-Term Management Plan: List of Progress for Priority Measures
Measures of MediumTerm Management Plan

Contents of Measures

Targeted Effect and Progress Status(1) Optimize the scale of equity capital・ Based on future demand for funds, in June 2021, we executed atreasury stock tender offer for 7 million shares (equivalent to28.83% of outstanding shares at that time; value of ¥15.7 bn)
・ Continue dividends targeting a consolidated payout ratio of 50%

Improving capitalefficiency(2) Maintain financial soundness
・ Improve transaction conditions
・ Liquidate large receivables
・ Reduce strategically held shares
Eliminate 9 types of stocks during V73(including one type of stock transferred to pure investment
shares)Targeted Effect
Maintain ROE above the cost of shareholders’ equity
Progress Status: Excellent
・ As a result of rightsizing equity capital, ROE during theV73 is expected to be supported at a level exceeding therange of 5–6% cost of shareholders’ equity (Company
estimate).
・ Equity ratio as of September 30, 2023 was 40.8%.
Aiming to maintain the financial soundness necessary tocontinue business transactions.

(3) Ensure the mobility and stability of fund procurement
・ Entered into a commitment line contract (from August 31, 2021)- 16 -[SANSHIN CONFIDENTIAL]

V73 Medium-Term Management Plan: List of Progress for Priority Measures
Measures of MediumTerm Management Plan

Contents of Measures

Targeted Effect and Progress Status(1) Efforts for issues regarding sustainability (SDGs, ESG)a) Enhance human capital and maximize its value
Strengthen initiatives for management position ratio
targets for March 31, 2031

Targeted Effect・ Establish a management base for sustainable growth・ Strengthen responsibility of explanation toward stakeholders
Progress Status: Good
<Enhanced human capital and maximized its value>
・ Continued recruitment of new graduates and mid-career workers, andenhanced training programs (Udemy, etc.) for expanded support of skill
development and career advancement
・ Revised the remuneration system to ensure fair treatment and maintaina competitive salary level, and increased base salary<Initiatives for the issue of climate change>
・ Strengthened efforts to serve market needs for carbon neutrality⇒Expanded sales for vehicle-mounted products and promoted
business based on service provision (cloud)・ Performed disclosure in accordance with TCFD and set targets for
reduction of GHG emissions<Strengthened functions of Board of Directors>
・ Identified required skills and inspected the status of skill possession⇒Possessed required skills for the overall Board of Directors
・Appointed a female director and accelerated initiatives to promote theactive participation of women (from June 2023)

Women

Strengthening
corporate governanceForeignnationals

03/23 term results

5.5％

11.0％

03/31 term targets

10％

Maintained at
10% or more

Mid-career
hires
36.0％
Maintained at
30% or more

・ Hire diverse and talented human resources
・ Enhance support for skill development and careeradvancement
・ Ensure fair evaluation/treatment and create acomfortable working environmentb) Respond to the issue of climate change
・ Reflect extracted risks and opportunities in management
strategy・ Perform disclosure in accordance with TCFD
(2) Strengthen functions of the Board of Directors
・ Secure the required skill balance to make accurate
decisions on important matters and to supervise
business execution- 17 -[SANSHIN CONFIDENTIAL]

III. Full-Year Business Forecast for theYear Ending March 31, 2024

- 18 -[SANSHIN CONFIDENTIAL]

Year Ending March 2024
Full-Year Business Forecast(Unit: ¥100 million)■ Net sales are expected to be in line with the previous fiscal year, while earnings are
forecast to decline year-on-year.
03/19 Result

03/20 Result

03/21 Result

03/22 Result

03/23 Result

03/24 Forecast

YoY Change

1,478.8
1,230.9
1,127.9
1,235.8
1,611.1
1,570.0
7.7%
9.1%
9.8%
10.9%
10.5%
9.5%
Gross Profit on Sales
114.1
112.3
110.5
135.3
168.8
149.5
6.4%
7.5%
7.9%
7.5%
6.2%
6.7%
SG&A Expenses
94.4
92.7
88.8
93.2
100.3
105.5
1.3%
1.6%
1.9%
3.4%
4.3%
2.8%
Operating Profit
19.7
19.6
21.7
42.1
68.5
44.0
1.2%
1.5%
1.7%
2.9%
3.4%
2.2%
Ordinary Profit
17.4
18.6
18.8
35.6
55.1
35.0
1.0%
1.2%
1.5%
2.0%
2.4%
1.7%
Net Profit Attributable to
Shareholders of Parent Company
14.5
14.5
16.5
25.3
38.3
26.0

97%

Net Sales

ROE
AnnualDividend Per
Share

Ordinary Dividend
Commemorative
Dividend

Total

Payout Ratio
Exchange Rate
(1 US dollar)

89%
105%
64%
64%
68%

2.8%
¥70
－
¥70

3.4%
¥70
－
¥70

3.9%
¥40
－
¥40

6.8%
¥80
¥20
¥100

11.8%
¥135
－
¥135

7.2%
¥100
－
¥100

-4.6P
-¥35
－
-¥35

93.3%

93.2%

46.9%

48.8%

43.5%

47.5%

+4.0P

¥110.91¥108.74¥106.06¥112.38¥135.49¥140.00¥4.51*Figures in the YoY Change section for ROE, annual dividend per share, payout ratio
and exchange rate represent increases or decreases.
- 19 -[SANSHIN CONFIDENTIAL]

Year Ending March 2024
Year-to-Year Comparison of Consolidated Ordinary Profit● Decrease in gross profit Approx. ¥1.16 bn*
Decrease in net sales in the device businesssegment and conclusion of some highmargin projects

Ordinary
Profit¥5.51 bn

● Decrease in non-operating profit
Approx. ¥0.33 bn*
Mainly an increase in interest expenses● Increase in SG&A expenses
Approx. ¥0.52 bn
Mainly increases in personnel expenses,
outsourcing expenses, logistics expenses, andactivity expenses in conjunction with the endof COVID-19

Decrease of approx. ¥2.01 bn

03/23 Term
Result*Per accounting standards, the difference between the month-end exchange rate andthe average exchange rate is shown in both denominations in the profit and loss
statement. However, in the above figure, the difference is offset by gross profit andnon-operating profit and loss, and the actual increase or decrease is shown.
- 20 -

Ordinary
Profit¥3.50 bn

03/24 Term
Forecast[SANSHIN CONFIDENTIAL]

Year Ending March 2024
Full-Year Business Forecast by Segment (Unit: ¥100 million)■ In the device business, we forecast that net sales will decrease by 3% year-on-year, and that profit will decrease due to thedecrease in net sales and withdrawal from some high-margin projects■ In the solution business, we forecast that net sales will increase by 5% year-on-year, and that profit will increase due to theincrease in net sales
03/19 Result 03/20 Result 03/21 Result 03/22 Result 03/23 Result

03/24
Forecast

YoY
ChangeNet Sales
1,332.8
DeviceBusiness

Operating Profit

1.3%

1,090.8
1.4%

17.1
Segment
Profit

0.3%

989.9
1.6%

3.6%

15.3
0.4%

1,105.2

15.7
0.2%

1,475.8
4.4%

40.1
2.0%

1,428.0

97%

38.8

59%

2.7%
65.5

2.8%

1.4%

4.7

4.2

1.7

21.9

41.4

20.0

48%

146.0

140.1

138.0

130.6

135.3

142.0

105%

19.3

108%

Net Sales
Solution
Business

Operating Profit

11.3%

13.2%
16.5

Segment
ProfitExchange rate (1 US dollar)

8.7%

15.2%
18.4

10.3%

14.0%
21.0

12.4%

13.2%
18.3

10.5%

13.6%
17.9

10.1%

10.6%

12.7

14.4

17.1

13.7

13.7

15.0

109%

¥110.91¥108.74¥106.06¥112.38¥135.49¥140.00¥4.51- 21 -[SANSHIN CONFIDENTIAL]

Year Ending March 2024
Year-to-Year Comparison of Consolidated Net Sales (Unit: ¥100 million)
-3%
1,476

1,091
Strategic
Business

100

1,428

488

430

478

503

471

510

495

03/22 Term

03/23 Term

03/24 Term
Forecast

1,105
990
244
155

Core Business

426
431

VolumeBusiness

565
404

03/20 Term

03/21 Term390

- 22 -By Business Category of Device Business【Year-to-Year Comparison of Fluctuations】■ Volume Business (down 3% YoY)
● Decrease for mobile devices○ Sales for social infrastructure will remain
at the same level■ Core Device (up 5% YoY)
○ Sales for industry, vehicle-mounted
business, and storage, etc. will maintainrecovery trend■ Strategic Device (down 12% YoY)
● Decrease in overseas merchandise such as
wireless merchandise/analog
semiconductors, etc.
● Decrease in modular products[SANSHIN CONFIDENTIAL]

Year Ending March 2024
Year-to-Year Comparison of Consolidated Net Sales (Unit: ¥100 million)
-3%
1,476

1,428

198

1,091

184

1,105
990
207

Other

413

660

618

618

626

03/23 Term

03/24 Term
Forecast

281
356

Overseas
Manufacturers

Electromechanical
Parts
Manufacturers

212

219

466

490

03/20 Term

03/21 Term

542

03/22 Term

- 23 -

By Supplier of Device Business【Year-to-Year Comparison of Fluctuations】■ Electromechanical Parts Manufacturers (up 1% YoY)
○ Expansion in sales to large customers as share of
total sales● Decrease for mobile devices■ Overseas Manufacturers (down 6% YoY)
● Decrease in wireless merchandise/analog
semiconductors, etc.
● Decrease in modular products■ Other (down 7% YoY)
● Decline in sales agency business due to decline inproduction unit volume, etc.
○ Social infrastructure will remain at the same level[SANSHIN CONFIDENTIAL]

Year Ending March 2024
Year-to-Year Comparison of Consolidated Net Sales (Unit: ¥100 million)
+5%
140.1
Video
Systems

16.4

AP Software

27.8

142.0

138.0
16.1

130.6
17.9

27.3

135.3
19.8

16.2

28.3

28.8

23.6

26.9

27.8

33.2

33.7

33.3

26.7

Embedded
Systems

29.7

PublicSystems

30.1

NW

36.1

03/20 Term

27.1

36.5

By Sector of Solution Business

31.0

29.2

30.2

32.3

03/21 Term

03/22 Term

03/23 Term

03/24 Term
Forecast- 24 -【Year-to-Year Comparison of Fluctuations】■ NW (up 22% YoY)
○ Increase in investment in IT infrastructure byprivate corporations■ Public Systems (down 1% YoY)
● Slight decline in digital upgrading projects fordisaster preparedness■ Embedded Systems (up 3% YoY)
○ Recovery of demand related to servers, etc.
■ AP Software (up 2% YoY)
○ Software development projects will remain at thesame level■ Video Systems (up 22% YoY)
〇 Favorable trend in projects for video
transmission equipment[SANSHIN CONFIDENTIAL]

Year Ending March 2024
Forecast of Consolidated Financial Situation (Unit: ¥100 million)■ Total assets are forecast to be ¥82.4 bn at the end of the fiscal year ending March 31, 2024, ¥3.8 bn higher than at the end of the previous fiscal year.
Increase in accounts receivable–trade is the main factor.
■ Equity ratio is forecast at 45.0%, roughly in line with the figure at the end of the previous fiscal year (1.4 points higher).
■ Cash flow from operating activities is expected to increase by ¥1.2 bn due to liquidation of receivables. Cash and deposits on hand are forecast at ¥9.0
bn, in line with the end of the previous fiscal year.
■ The Company will continue its commitment line contracts totaling ¥6.0 bn with correspondent financial institutions.
1) Balance Sheets
2) Cash FlowsFY EndedMar. 22
Result (A)FY EndedMar. 23
Result (B)

B-A
Increase/
Decrease

FY EndingMar. 24
Forecast (C)Cash and deposits

93.1

88.9

-4.1

90.0

1.1

Accounts receivable

Decrease (increase) ininventories

358.7

372.7

14.0

405.6

32.9

Inventories

197.3

250.0

52.7

255.1

5.1

Increase (decrease) in
accounts
payable-trade

Other assets

79.0

74.4

-4.6

73.0

-1.4

Total assets

728.1

786.0

57.9

823.7

37.7

Operating C/F

144.6

138.6

-6.0

143.9

5.3

Investing C/F

244.3

268.3

24.0

270.7

2.4

Financing C/F

Other liabilities

32.4

36.6

4.2

38.0

1.4

Total net assets

306.8

342.5

35.7

371.1

28.6

Accounts payable
Interest-bearing
liabilities

Total liabilities
and net assets
Equity ratio

728.1
42.1%

786.0
43.6%

57.9
1.5%

823.7
45.0%

C-B
Increase/
Decrease

37.7
1.4P

- 25 -

Decrease (increase) in
accounts
receivable-trade

FY Ended Mar.
22 Result

FY Ended Mar.
23 Result

FY Ending Mar.
24 Forecast

-0.1

7.9

-32.9

-45.6

-44.7

-5.1

2.3

-17.0

5.3

65.3

46.0

44.4

21.9

-7.8

11.8

-1.5

-0.5

-185.8

2.6

3.1

1.5

-162.4

-4.1

1.1

93.1

88.9

90.0

Other

Foreign currency
conversion
adjustments
Increase (decrease) in cash
and deposits
Balance of cash and deposits
at term-end-10.7[SANSHIN CONFIDENTIAL]

Concept of Return to Shareholders● Policy on Distribution of Profits
The Company considers profit returns to its shareholders as one of the most importantmanagement issues. The Company’s basic policy is to determine dividends by comprehensively
considering the need to maintain a balance between rewarding of shareholders, investment togain opportunities for growth, attainment of sufficient retained earnings to enable sustainablegrowth, and improvement in capital efficiency. Under this policy, the Company has set a target
for its dividend payout ratio of around 50% on a consolidated basis.
● Dividend Forecast for the Year Ending March 31, 2024
An annual dividend of ¥100 per share (midterm dividend of ¥35, term-end dividend of ¥65);
consolidated dividend payout ratio of 47.5%
03/19 Result
Ordinary
Dividend
AnnualCommemorative
Dividend Per
Dividend

Share

Total

Payout Ratio

03/20 Result

03/21 Result

03/22 Result

03/23 Result

03/24 Forecast

YoY Change

¥70

¥70

¥40

¥80

¥135

¥100

-¥35

－

－

－

¥20

－

－

－

¥70

¥70

¥40

¥100

¥135

¥100

-¥35

93.3%

93.2%

46.9%

48.8%

43.5%

47.5%

+4.0P

*Figures in the YoY Change section represent increases or decreases in amount.

- 26 -[SANSHIN CONFIDENTIAL]

Change in Return to Shareholders
03/19 Term
Result03/20 Term
Result03/21 Term
Result03/22 Term
Result03/23 Term
Result03/24 Term
Forecast(1) Consolidated net profit¥1,449 million¥1,451 million¥1,646 million¥2,525 million¥3,833 million¥2,600 million(2) Comprehensive profit¥1,585 million¥666 million¥2,393 million¥4,204 million¥4,788 million

－

48.3%

57.0%

51.0%

42.1%

43.5%

45.1%

¥1,352 million(¥70)¥1,352 million(¥70)¥773 million(¥40)¥1,232 million(¥100)¥1,666 million(¥135)¥1,235 million(¥100)

93.3%

93.2%

46.9%

48.8％

43.5%

47.5%

¥19.72 billion(9 million shares)--¥15.74 billion(7 million shares)－

Suspense

1,454.2%

93.2%

46.9%

672.3％

43.5%

Suspense

5,000 thousand
shares--8,000 thousand
shares－

Suspense

24,281 thousand
shares(19,178 thousand
shares)24,281 thousand
shares(19,180 thousand
shares)24,281 thousand
shares(19,183 thousand
shares)16,281 thousand
shares(12,183 thousand
shares)16,281 thousand
shares(12,192 thousand
shares)

Suspense(10) Net profit per share¥67.48¥75.66¥85.82¥171.12¥314.43¥213.25(11) Net assets per share¥2,224.47¥2,188.84¥2,249.40¥2,514.04¥2,803.65¥2,881.29(3) Consolidated equity ratio(4) Total dividends(Dividend per share)(5) Consolidated payout ratio(6) Value of treasury stock acquired(Number of shares acquired)(7) Total payout ratio (4+6)÷1(8) Cancellation of treasury stock(9) Total number of shares issued(excluding treasury stock) at fiscal
year end*1) Total dividends include the dividend amount for shares held by trusts related to the performance-based stock compensation plan for directors (excluding external directors).
The result for 03/22 term includes the commemorative dividend ¥20 per share.
2) Net profit per share is calculated based on the average number of issued shares (excluding treasury stock) during the period.
3) Net assets per share is calculated based on the total number of shares issued (excluding treasury stock) at fiscal year end.
4) The forecast for net profit per share and net assets per share for 03/24 term is calculated based on the total number of shares issued (excluding treasury stock) as of March 31, 2023.

- 27 -[SANSHIN CONFIDENTIAL]

Our Corporate Code

TRUST

PRINCIPLESSINCERITY

Business cannot
succeed without trust.
It begins and ends
with trust.

Do not just pursue profit.
But act based onprinciples, which can berealized through selfdiscipline.

Always act sincerely.
Rise to the challengehead-on.

- 28 -[SANSHIN CONFIDENTIAL]