Consolidated Financial Results
for the Three Months Ended June 30, 2024
[IFRS]
August 9, 2024
Company name: Shinwa Co., Ltd.
Stock exchange listing: Tokyo Stock Exchange and Nagoya Stock Exchange
Code number: 3447
URL: https://www.shinwa-jp.com/en/relation/index.html
Representative: Kurio Noritake, President and Representative Director
Contact: Mitsuyoshi Hirasawa, Director, Executive Officer, General Manager of Administration Headquarters
Phone: +81-584-66-4436
Scheduled date of commencing dividend payments: –Availability of supplementary briefing material on financial results: Yes
Schedule of financial results briefing session: None
(Amounts of less than one million yen are rounded down.)
1. Consolidated Financial Results for the Three Months Ended June 30, 2024
(April 1, 2024 to June 30, 2024)(1) Consolidated Operating Results(% indicates changes from the previous corresponding period.)

RevenueThree months ended
June 30, 2024
June 30, 2023

Three months ended
June 30, 2024
June 30, 2023

Operating profit

Profit before tax

ProfitMillion yen%

Million yen%

Million yen%

Million yen

%

4,038
2,906

38.9
(33.5)

421
177

137.0
(67.5)

395
165

138.9
(68.7)

264
109

142.2
(70.3)

Profit attributable toowners of parent

Comprehensive
incomeMillion yen%

Million yen

%

Yen

Yen

265
110

139.6
(69.4)

264
110

139.8
(70.3)

19.17
7.96

–
–

Basic earnings
per share

Diluted earnings
per share(2) Consolidated Financial Position
Total assets
As ofJune 30, 2024
March 31, 2024

Total equity

Equity attributableto owners of parent

Equity attributableto owners of parent
to total assets

Million yen

Million yen

Million yen%

26,60020,675

15,363
15,31815,35015,31057.7
74.0

2. Dividends
1stquarter-end
Yen

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

Fiscal year ended–
16.00
March 31, 2024
Fiscal year ending–
March 31, 2025
Fiscal year ending
16.00
March 31, 2025 (Forecast)
Note: Revision to the dividends forecast announced most recently: None

Total

Yen

Yen

Yen

–

16.00

32.00

–

16.00

32.00

3. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2025
(April 1, 2024 to March 31, 2025)(% indicates changes from the previous corresponding period.)

RevenueFirst half
Full year

Operating profit

Profit before tax

ProfitMillion yen%

Million yen%

Million yen%

Million yen

%

6,647
16,000

0.4
26.2

495
1,600

(4.9)
128.5

441
1,494

(11.2)
129.0

296
1,000

(13.6)
143.3

Profit attributable toowners of parent
Million yen

Basic earnings per share%

YenFirst half296
(12.9)
21.29
Full year
1,000
144.1
71.91
Note: Revision to the financial results forecast announced most recently: None
* Notes:(1) Significant changes in the scope of consolidation during the period: Yes
Newly included: 5 companies, CTR Corporation (currently Yagumi Corporation) and 4 others
Excluded: –(2) Changes in accounting policies and changes in accounting estimates
1) Changes in accounting policies required by IFRS: None
2) Changes in accounting policies other than 1) above: None
3) Changes in accounting estimates: None
(3) Total number of issued shares (common shares)
1) Total number of issued shares at the end of the period (including treasury shares):
June 30, 2024: 14,103,000 shares
March 31, 2024: 14,103,000 shares2) Total number of treasury shares at the end of the period:
June 30, 2024: 193,484 shares
March 31, 2024: 193,484 shares
3) Average number of shares outstanding during the period:
Three months ended June 30, 2024: 13,845,870 shares
Three months ended June 30, 2023: 13,910,482 shares*Review of the attached quarterly consolidated financial statements by a certified public accountant or auditing firm:
None*Proper use of financial results forecast and other notes
Financial results forecasts were prepared based on information available at the time of the announcement of thisdocument, and actual results may differ from the forecasts owing to a wide range of factors. For the conditions thatform the assumptions for the financial results forecasts, please refer to (3) Explanation of Consolidated Financial
Results Forecast and Other Forward-Looking Information in 1. Qualitative Information on Quarterly Financial
Results on page 3 of the attachments.

Table of Contents
1. Qualitative Information on Quarterly Financial Results ................................................................
(1) Explanation of Operating Results ..............................................................................................
(2) Explanation of Financial Position ..............................................................................................
(3) Explanation of Consolidated Financial Results Forecast andOther Forward-Looking Information .........................................................................................

2
2
3
3

2. Condensed Quarterly Consolidated Financial Statements and Primary Notes ............................... 4(1) Condensed Quarterly Consolidated Statement of Financial Position ......................................... 4(2) Condensed Quarterly Consolidated Statements of Profit or Loss and Comprehensive Income . 6(3) Notes to Condensed Quarterly Consolidated Financial Statements ............................................. 8(Going concern assumption) ................................................................................................... 8(Significant changes in shareholders’ equity).......................................................................... 8(Significant subsequent events)............................................................................................... 8(Segment information) ............................................................................................................ 8(Notes to consolidated statement of cash flows) ..................................................................... 8(Business combinations) ......................................................................................................... 9

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1. Qualitative Information on Quarterly Financial Results(1) Explanation of Operating Results
During the first three months of the current fiscal year, the Japanese economy continued to recover gradually,
with improvements in employment, although there were stalls in some activities, such as exports. However, theoutlook remains uncertain as there is still a risk of an economic downturn due to the prolonged weakness of theyen, high prices of materials and resources, concerns about the outlook for the Chinese economy, and the protracted
conflicts in the Middle East and Ukraine.
In the construction industry, which is the main source of demand for our products, construction investments
were solid, amounting to ¥8.6 trillion between April and May 2024 (up 0.4% year on year), according toComprehensive Construction Statistics published by the Ministry of Land, Infrastructure, Transport and Tourism.
According to Building Starts Statistics by the said ministry, the number of residential and non-residential
construction starts during the same period increased 3.4% from one year earlier to 151,996, and the total floor areaof construction starts was down 4.6% to 17,156 thousand square meters. Although construction investments
increased, the scale of construction starts was smaller. This is mainly the result of the shortage of construction
workers and the surging prices of building materials.
In this business climate, scaffolding installation companies, which are the primary customers for wedge
binding type scaffolding, continued to refrain from purchasing scaffolding equipment and rent it amid increases inoverall costs, including materials. Against this backdrop, we took the following countermeasures: we focused on
scaffolding equipment installation companies in Japan, into our subsidiary in April 2024, which contributed to
distribution channels, leading to increased revenue growth opportunities.
As a result of the above, revenue for the first three months amounted to ¥4,038 million (up 38.9% year onyear). Operating profit was ¥421 million (up 137.0% year on year). Profit before tax amounted to ¥395 million (up138.9% year on year), and profit attributable to owners of parent amounted to ¥265 million (up 139.6% year onyear).
The following section explains the performance of business divisions because the Shinwa Group has one
business segment.
1) Scaffolding Equipment Division
Despite a solid demand for scaffolding equipment, customers continued to rent rather than purchasescaffolding equipment because of the high prices of materials and products. Under these circumstances, we focusedon agile and flexible sales activities by combining the strengths of both sales and rentals while centering on rental
services for next generation scaffolding and so on. In addition, the Yagumi Group, which became our subsidiary in
April 2024, responded to firm construction demand with abundant human resources and steadily secured projects.
As a result, revenue for the first three months in the Scaffolding Equipment Division amounted to ¥3,342
million (up 44.2% year on year).
2) Logistics Equipment Division
In the Logistics Equipment Division, orders increased for logistics equipment dedicated to the building
materials leasing industry, which is witnessing a growing demand. Additionally, the Division steadily received
orders, primarily for bulk containers for shipping liquids and other repeated projects.
As a result, revenue for the first three months in the Logistics Equipment Division amounted to ¥696 million(up 18.1% year on year).

2Name of product and service

Scaffolding
equipment

Logistics
equipment

For the three months ended
June 30, 2023

(Thousand yen)
For the three months ended
June 30, 2024

977,886

1,325,557

607,004

398,531

330,756
366,866
34,651
2,317,165
589,227589,227
2,906,393

1,109,869
324,700
183,383
3,342,040
696,088
696,088
4,038,129

Wedge binding typescaffolding
Next generation
scaffolding
Installation and rental
Other sales
Other
Subtotal
Pallets
Subtotal
Total

Note: Revenue stated in installation and rental and pallets includes revenue derived from leases under IFRS 16 of¥100,703 thousand in the three months ended June 30, 2023, and ¥109,525 thousand in the three months ended
June 30, 2024.

(2) Explanation of Financial Position(Assets)
Current assets at the end of the first quarter of the current fiscal year increased by ¥802 million from the endof the previous fiscal year to ¥8,093 million, mainly due to factors such as an increase in inventories of ¥283
million and an increase in trade and other receivables of ¥1,135 million, despite a decrease in cash and cash
equivalents of ¥709 million. Non-current assets increased by ¥5,123 million from the end of the previous fiscal
year to ¥18,507 million, mainly due to an increase in property, plant and equipment of ¥1,413 million and anincrease in goodwill of ¥3,299 million associated with making the Yagumi Group into a subsidiary. As a result,
total assets increased by ¥5,925 million from the end of the previous fiscal year to ¥26,600 million.
(Liabilities)
Current liabilities at the end of the first quarter of the current fiscal year increased by ¥4,927 million from theend of the previous fiscal year to ¥7,871 million, mainly due to factors such as an increase in borrowing of ¥4,658
million associated with making the Yagumi Group into a subsidiary and an increase of trade and other payables of¥234 million. Non-current liabilities increased by ¥952 million from the end of the previous fiscal year to ¥3,365
million. The increase was primarily attributable to an increase in borrowings of ¥675 million. As a result, total
liabilities increased by ¥5,880 million from the end of the previous fiscal year to ¥11,237 million.
(Equity)
Total equity at the end of the first quarter of the current fiscal year increased by ¥45 million from the end of
the previous fiscal year to ¥15,363 million. This was mainly attributable to factors such as the posting of profit
attributable to owners of parent of ¥265 million.
(3) Explanation of Consolidated Financial Results Forecast and Other Forward-Looking Information
There are no revisions to the first half and full year consolidated financial results forecasts announced in the
consolidated financial results on May 10, 2024.

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2. Condensed Quarterly Consolidated Financial Statements and Primary Notes(1) Condensed Quarterly Consolidated Statement of Financial Position(Thousand yen)
As of March 31, 2024

As of June 30, 2024

AssetsCurrent assets
Cash and cash equivalents

1,843,324

1,133,856

Trade and other receivables

2,225,876

3,361,815

Inventories

3,182,833

3,466,256

Other financial assets–

17,580

Other current assets

39,396

114,045

Total current assets

7,291,430

8,093,554

2,488,388

3,901,727

204,761

384,828

Goodwill

9,221,769

12,521,306

Intangible assets

1,352,107

1,344,323

105,080

209,886–

114,778

Other non-current assets

12,12430,505

Total non-current assets

13,384,232

18,507,357

20,675,663

26,600,911

Non-current assets
Property, plant and equipment
Right-of-use assets

Other financial assets
Deferred tax assets

Total assets4

(Thousand yen)
As of March 31, 2024

As of June 30, 2024

Liabilities and equity
Liabilities
Current liabilities
Trade and other payables

1,045,596

1,280,541

Borrowings

1,490,914

6,149,012

59,503108,043

Income taxes payable
Other financial liabilities

69,272

96,747

Other current liabilities

278,629

237,264

Total current liabilities

2,943,917

7,871,609

Borrowings

1,963,658

2,639,528

Provisions

44,236

97,143

Other financial liabilities

143,151

296,214

Deferred tax liabilities

258,339271,266

3,900

61,650Non-current liabilities

Other non-current liabilities
Total non-current liabilities

2,413,286

3,365,802

Total liabilities

5,357,204

11,237,411

Share capital

153,576

153,576

Capital surplus

6,918,207

6,916,895

Retained earnings

8,363,728

8,406,565

Treasury shares(147,575)(147,575)

22,092

21,31815,310,028

15,350,780

8,430

12,71915,318,459

15,363,499

20,675,663

26,600,911

EquityOther components of equity
Total equity attributable to owners of parent
Non-controlling interests
Total equity
Total liabilities and equity5(2) Condensed Quarterly Consolidated Statements of Profit or Loss and Comprehensive Income
Condensed Quarterly Consolidated Statement of Profit or Loss
For the Three-Month Period(Thousand yen)
For the three months ended
June 30, 2023
2,906,393

For the three months ended
June 30, 2024
4,038,129

Cost of sales(2,224,994)(2,987,823)

Gross profit

681,399

1,050,305

Selling, general and administrative expenses(503,338)(631,576)

Revenue

Other income

2,704

9,279

Other expenses(2,962)(6,650)Operating profit

177,804

421,358

Finance income

24

2,914

Finance costs(12,194)(28,513)

Profit before tax

165,633

395,759

Income tax expense(56,357)(131,131)

Profit109,276

264,628

110,747

265,390

Profit attributable to:
Owners of parent
Non-controlling interests(1,470)(761)

Profit109,276

264,628

7.96

19.17

Earnings per share:
Basic earnings per share (yen)6

Condensed Quarterly Consolidated Statement of Comprehensive Income
For the Three-Month Period(Thousand yen)
For the three months ended
June 30, 2023
Profit

For the three months ended
June 30, 2024

109,276

264,628

2,270(1,251)

2,270(1,251)304

936(1,636)–(1,332)

936

938

(315)

110,214264,313

Owners of parent

111,536

264,616

Non-controlling interests(1,321)(302)

Comprehensive income

110,214264,313

Other comprehensive income
Items that will not be reclassified to profit or loss:
Financial assets measured at fair value through othercomprehensive income
Total of items that will not be reclassified to profit
or loss
Items that may be reclassified to profit or loss:
Exchange differences on translation of foreign
operations
Cash flow hedges
Total of items that may be reclassified to profit orloss
Other comprehensive income, net of tax
Comprehensive income
Comprehensive income attributable to:7(3) Notes to Condensed Quarterly Consolidated Financial Statements(Going concern assumption)
There is no relevant information.
(Significant changes in shareholders’ equity)
There is no relevant information.
(Significant subsequent events)
There is no relevant information.
(Segment information)
The Group mainly engages in the business of manufacturing and sale of scaffolding equipment and logistics
equipment. There is a single reportable segment of the manufacturing and sale of scaffolding equipment andlogistics equipment.
Revenue from external customers for each product and service is as follows.

Name of product and service

For the three months ended
June 30, 2023

(Thousand yen)
For the three months ended
June 30, 2024

Wedge binding type977,886
1,325,557
scaffolding
Next generation
607,004
398,531
scaffolding
Scaffolding
Installation and rental
330,756
1,109,869
equipment
Other sales
366,866
324,700
Other
34,651
183,383
Subtotal
2,317,165
3,342,040
Pallets
589,227
696,088
Logistics
equipment
Subtotal
589,227
696,088
Total
2,906,393
4,038,129
Note: Revenue stated in installation and rental and pallets includes revenue derived from leases under
IFRS 16 of ¥100,703 thousand in the three months ended June 30, 2023, and ¥109,525 thousandin the three months ended June 30, 2024.
(Notes to consolidated statement of cash flows)
Condensed quarterly consolidated statement of cash flows for the three months ended June 30, 2024 is notprepared. Depreciation and amortization for the three months ended June 30, 2023 and 2024 are as follows.
(Thousand yen)
For the three months ended
For the three months ended
June 30, 2023
June 30, 2024
Depreciation and amortization
139,034
182,166

8

(Business combinations)(Business combination through acquisition)
At the Board of Directors meeting held on March 14, 2024, the Company resolved to acquire all shares of
agreement as of the same date.
Based on this agreement, the Company acquired all shares of CTR on April 1, 2024, making it a subsidiaryof the Company.
In conjunction with this share acquisition, Yagumi Corporation and Ikeda Koumuten, which are wholly owned
subsidiaries of CTR, became second-tier subsidiaries of the Company, and Itabashi-gumi Y.K. and Itabashi
Transport Y.K., which are second-tier subsidiaries of CTR, became third-tier subsidiaries of the Company.
1. Overview of the business combination(1) Name of the acquired company and its line of business
Name of the acquired company:
CTR Corporation
Line of business of the acquired company: Consulting services for corporate rehabilitation and corporate
management, etc.
(2) Main reasons for the business combination
CTR is one of the largest scaffolding equipment installation companies in the Tokai region and one of thelargest in Japan, with Yagumi Corporation as its core subsidiary (hereinafter collectively referred to as the “Yagumi
Group” including CTR and its subsidiaries). By incorporating and developing various peripheral businesses, CTR
engages in business operations with an eye toward achieving further business growth in the future.
While the Shinwa Group, as a manufacturer, upholds the purpose of “Protecting Lives and Supporting the
Future,” the Yagumi Group, as users, prides themselves on being “safe workers who are instrumental in ensuring
the safety of construction projects.” The participation of the Yagumi Group in the Shinwa Group is expected tolead to further business expansion and entry into new fields based on the high affinity of the two Groups. We expectthat our mutual collaboration will further contribute to solving social issues surrounding construction, and therefore,
we have decided to acquire the shares.
Taking the opportunity of making the Yagumi Group a subsidiary, we aim to create new value and further
enhance corporate value by mutually generating synergies through the sharing of management resources andstrengthening business collaboration within the Shinwa Group.
(3) Date of the business combination
April 1, 2024
(4) Ratio of voting rights acquired100%
2. Consideration for the acquisition and the details thereofCash¥3,000,000 thousand
3. Amount of acquisition-related expenses and the line item thereof
Acquisition-related expenses for this business combination amounted to ¥76 million and are included in“Selling, general and administrative expenses” in the consolidated statement of profit or loss in the previous fiscal
year.

9

4. Amount of goodwill arising from the acquisition¥3,299,536 thousand
As the allocation of acquisition cost has not been completed as of June 30, 2024, the amount of goodwill is aprovisionally calculated amount.
(Transactions under common control, etc.)
At the Board of Directors meeting held on April 17, 2024, the Company resolved that Yagumi Corporation,
our consolidated second-tier subsidiary, would absorb CTR Corporation, our consolidated subsidiary, and Yagumi
Corporation completed the absorption on June 1, 2024.
1. Outline of the business combination(1) Names of the constituent companies and their line of business
Combining company (Surviving company)
Name:
Yagumi Corporation (Consolidated second-tier subsidiary of the Company)
Line of business:
Contracting and brokering, etc. of scaffolding work
Combined company (Absorbed company)Name:
CTR Corporation (Consolidated subsidiary of the Company)
Line of business:
Consulting services for corporate rehabilitation and corporate management, etc.
(2) Date of the business combination
June 1, 2024
(3) Legal form of the business combination
Absorption-type merger with Yagumi Corporation as the surviving company and CTR Corporation as theabsorbed company(4) Company name after the business combination
Yagumi Corporation(5) Other items related to the transaction overview
This merger aims to streamline the Group’s organizational structure and business operations, thereby
improving overall management efficiency.
2. Overview of accounting process conducted
A business combination under common control is a business combination in which all of the combining
companies or businesses are ultimately controlled by the same company or companies both before and after thebusiness combination, and that control is not transitory. The Group continues to apply accounting treatment for all
business combination transactions under common control based on book value.

10