Consolidated Financial Results
for the Six Months Ended September 30, 2023
[IFRS]
November 10, 2023
Company name: Shinwa Co., Ltd.
Stock exchange listing: Tokyo Stock Exchange and Nagoya Stock Exchange
Code number: 3447
URL: http://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 filing the quarterly securities report: November 10, 2023
Scheduled date of commencing dividend payments: December 4, 2023
Availability of supplementary briefing material on quarterly financial results: Yes
Schedule of quarterly financial results briefing session: Yes (for institutional investors and analysts)(Amounts of less than one million yen are rounded down.)
1. Consolidated Financial Results for the Six Months Ended September 30, 2023
(April 1, 2023 to September 30, 2023)(1) Consolidated Operating Results(% indicates changes from the previous corresponding period.)
Revenue
Operating profit
Profit before tax
ProfitSix months ended
Million yen%
Million yen%
Million yen%
Million yen%
September 30, 2023
6,621 (25.7)
520 (53.2)
496 (53.9)
342 (54.5)
September 30, 2022
8,909
8.2
1,113 (11.2)
1,077 (11.5)
752 (10.7)

Six months ended
September 30, 2023
September 30, 2022

Profit attributable toowners of parent

Comprehensive
incomeMillion yen%

Million yen

%

Yen

Yen

339
744

(54.3)(12.1)

345
756(54.4)(10.6)

24.43
53.53

53.52

Basic earnings
per share

Diluted earnings
per share(2) Consolidated Financial Position
Total assets
As of September 30, 2023
As of March 31, 2023

Total equity

Equity attributableto owners of parent
to total assets

Equity attributableto owners of parent

Million yen

Million yen

Million yen%

21,29821,294

15,462
15,552

15,452
15,54572.5
73.0

2. Dividends
1stquarter-end

2ndquarter-end

Yen

Yen

Annual dividends
3rdYear-endquarter-end

Fiscal year ended–
0.00
March 31, 2023
Fiscal year ending–
16.00
March 31, 2024
Fiscal year ending
March 31, 2024 (Forecast)
Note: Revision to the dividends forecast announced most recently: None

Total

Yen

Yen

Yen

–

32.00

32.00

–

16.00

32.00

3. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2024
(April 1, 2023 to March 31, 2024)(% indicates changes from the previous corresponding period.)
Revenue
Operating profit
Profit before tax
ProfitFull year

Million yen%

Million yen%

Million yen%

15,100

2.3

1,371

(8.7)

1,317

(8.2)

Profit attributable toowners of parent
Million yen

Million yen%

907 (8.0)

Basic earnings per share%

Yen

Full year
907 (10.0)
65.24
Note: Revision to the financial results forecast announced most recently: None
* Notes:(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in change inscope of consolidation): None
(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):
September 30, 2023: 14,103,000 shares
March 31, 2023: 14,103,000 shares2) Total number of treasury shares at the end of the period:
September 30, 2023: 198,634 shares
March 31, 2023: 192,518 shares
3) Average number of shares during the period:
Six months ended September 30, 2023: 13,906,438 shares
Six months ended September 30, 2022: 13,899,691 shares*These quarterly consolidated financial results are outside the scope of quarterly review by certified public
accountants or auditing corporations.
*Explanation of the 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 (4) Explanation of Consolidated Financial
Results Forecast and Other Forward-Looking Information in 1. Qualitative Information on Quarterly Financial
Results on page 4 of the attachments.

Table of Contents
1. Qualitative Information on Quarterly Financial Results ................................................................
(1) Explanation of Operating Results ..............................................................................................
(2) Explanation of Financial Position ..............................................................................................
(3) Overview of Cash Flows ............................................................................................................
(4) Explanation of Consolidated Financial Results Forecast and Other Forward-Looking
Information ................................................................................................................................

2
2
4
4
4

2. Condensed Quarterly Consolidated Financial Statements and Primary Notes ............................... 5(1) Condensed Quarterly Consolidated Statement of Financial Position ......................................... 5(2) Condensed Quarterly Consolidated Statements of Profit or Loss and Comprehensive Income . 7(3) Condensed Quarterly Consolidated Statement of Changes in Equity........................................... 9(4) Condensed Quarterly Consolidated Statement of Cash Flows ................................................... 10(5) Notes to Condensed Quarterly Consolidated Financial Statements ........................................... 11(Notes on going concern assumption) ................................................................................... 11(Significant subsequent events)............................................................................................. 111

1. Qualitative Information on Quarterly Financial Results(1) Explanation of Operating Results
During the first six months of the current fiscal year, the Japanese economy was supported by a recovery
of social activity following the end of the pandemic. Consumer spending, capital expenditures, jobs and othereconomic indicators are recovering. However, the outlook remains uncertain as there is still a risk of an
economic downturn due to the prolonged Ukraine conflict, the extended weakness of the yen, inflation andthe high cost of resources, and concerns about the outlook for the Chinese economy.
In the construction industry, which is the main source of demand for our products, construction
investments were generally stable, amounting to ¥21.9 trillion between April and August 2023 (up 3.5% year
on year), according to “Comprehensive Construction Statistics” published by the Ministry of Land,
Infrastructure, Transport and Tourism. However, according to “Building Starts Statistics” by the said ministry,
the number of residential and non-residential construction starts during the same period decreased 6.2% fromone year earlier to 371,876 and the total floor area of construction starts was down 13.5% to 44,040 thousandsquare meters. The declines are caused by the continuing high cost of building materials and labor shortage.
As a result, the business climate is very difficult. The Japanese government is firmly committed to making
consistent and rapid progress with measures to increase the country’s resilience to disasters as unusual weather
events become increasingly severe and frequent. Furthermore, large urban redevelopment projects are likely
to continue for many more years.
Demand for safety equipment at scaffolding installation companies, which are the primary customers forwedge binding type scaffolding, continues to be strong. However, companies continued to rent rather thanpurchase scaffolding and there are delays at many construction projects. During the first six months of theprevious fiscal year, shipments of scaffolding equipment were high because of a large volume of purchases
in part due to the timing of a price increase. In the first six months of the current fiscal year, there wereactivities for selling as well as for renting scaffolding. Although a slow recovery started in September due tothese activities, shipments in the fiscal year’s first six months were lower than one year earlier.
Despite these challenges, performance during the first six months was supported by installations ofmulti-level linked scaffolding, a new product that is ideal for high-rise buildings. In addition, preparations
are proceeding for starting sales of Rapid Floor™, a suspended system scaffold for bridges that was developedwith a large bridge construction company and a major temporary construction equipment rental company.
During the first six months, progress continued with measures for the growth of sales of products where
medium to long-term demand is expected and new products needed for projects to make Japan more resilient
to natural disasters.
In the Logistics Equipment Division, as economic and corporate activities in Japan continue to recover,there are significant variations in different industries regarding the volume and timing of demand fortransportation equipment. Demand for bulk containers for shipping liquids was strong in the previous fiscal
year but is currently lower and the volume of shipments has decreased. Furthermore, in the first six monthsof the previous fiscal year, there were shipments of pallets and other products to transport materials forelectrical equipment for a large one-time project. There were no large orders in this category in the first six
months of the current fiscal year and consequently revenue in this division decreased. However, theperformance of this division remains firm because of orders and construction involving large logistics
warehouses.
Activities to hold down expenses are continuing. To maintain sound relationships with partner companies
and a production framework capable of restoring the volume of products we supply, we responded to requests
from these companies to revise prices in order to reflect their increasing expenses. Selling, general andadministration expenses decreased because of a big downturn in shipping and delivery expenses due to the2smaller volume of products shipped. To maintain the soundness of our organization, we increased
expenditures and benefits for employees. There were also expenses for the start of a shareholder benefit
program as part of measures to distribute earnings to shareholders. Due to these activities, the operating
margin was 7.9% in the first six months, 4.6 percentage points lower than one year earlier.
As a result, revenue for the first six months decreased 25.7% from one year earlier to ¥6,621 million.
Operating profit was down 53.2% to ¥520 million, profit before tax was down 53.9% to ¥496 million, andprofit attributable to owners of parent was down 54.3% to ¥339 million.
The following section explains the performance of business divisions because the Shinwa Group has one
business segment.

1) Scaffolding Equipment Division
Customers are continuing to rent rather than purchase scaffolding equipment because of the high prices
of materials and products since the third quarter of the previous fiscal year. There are also challenges due topostponements and delays of construction projects caused by the shortage of construction workers. Althoughdemand for safety equipment has been consistently high, some customers are pushing back purchases ofwedge binding type scaffolding. In addition, the sales volume decreased year on year because there was alarge volume of purchases in the first six months of the previous fiscal year prior to price revisions. However,sales increased because performance benefited from demand for replacing pipe-frame scaffolding with next
generation scaffolding and from the ability to receive substantial orders from customers that are expecting tostart large-scale construction projects.
As a result, revenue for the first six months in the Scaffolding Equipment Division decreased 21.6% to¥4,834 million.
2) Logistics Equipment Division
The Logistics Equipment Division received orders, primarily for large logistics warehouse equipment
and other repeat projects, steadily during the first six months because of a higher level of production in manyindustries. However, the volume of orders for bulk containers for shipping liquids decreased and sales frompallets and other products to transport materials for electrical equipment was lower due to one-time sales ofthese pallets one year earlier.
As a result, revenue for the first six months in the Logistics Equipment Division decreased 34.8% to¥1,787 million.

Name of product and service

Scaffolding
equipment

Logistics
equipment

For the six months ended
September 30, 2022

Wedge binding typescaffolding
Next generation
scaffolding
Other scaffolding
equipment
Subtotal
Pallets
Subtotal
Total(Thousand yen)
For the six months ended
September 30, 2023

3,883,619

2,465,675

880,463974,016

1,401,210

1,394,560

6,165,293
2,743,828
2,743,828
8,909,122

4,834,252
1,787,628
1,787,628
6,621,880

Note: Revenue stated in other scaffolding equipment and pallets includes revenue from leases under IFRS 16 of¥263,269 thousand in the six months ended September 30, 2022 and ¥206,134 thousand in six months ended
September 30, 2023.

3

(2) Explanation of Financial Position(Assets)
Current assets at the end of the second quarter of the current fiscal year increased by ¥61 million fromthe end of the previous fiscal year to ¥8,023 million, mainly due to factors such as an increase in trade andother receivables of ¥763 million and an increase in cash and cash equivalents of ¥346 million despite adecrease in inventories of ¥1,037 million. Non-current assets decreased by ¥57 million from the end of theprevious fiscal year to ¥13,275 million. The decrease was primarily attributable to a decrease in property,
plant and equipment of ¥42 million. As a result, total assets increased by ¥4 million from the end of theprevious fiscal year to ¥21,298 million.
(Liabilities)
Current liabilities at the end of the second quarter of the current fiscal year increased by ¥121 million
from the end of the previous fiscal year to ¥5,362 million, mainly due to factors such as an increase in tradeand other payables of ¥135 million. Non-current liabilities decreased by ¥27 million from the end of theprevious fiscal year to ¥473 million. As a result, total liabilities increased by ¥94 million from the end of theprevious fiscal year to ¥5,836 million.
(Equity)
Total equity at the end of the second quarter of the current fiscal year decreased by ¥90 million from theend of the previous fiscal year to ¥15,462 million. This was mainly attributable to factors such as the postingof profit attributable to owners of parent of ¥339 million and dividends paid of ¥445 million.

(3) Overview of Cash Flows
Cash and cash equivalents (hereinafter “cash”) at the end of the first six months of the current fiscal year
was ¥2,409 million, an increase of ¥346 million from the end of the previous fiscal year.
Cash flows from each activity for the first six months of the current fiscal year and their primary factors
are as follows:(Cash flows from operating activities)
Net cash provided by operating activities for the first six months of the current fiscal year was ¥1,316
million (¥473 million used in the same period of the previous fiscal year). Main factors affecting cash inflows
were a decrease in inventories of ¥1,037 million, profit before tax of ¥496 million, and depreciation andamortization of ¥279 million. The main factors affecting cash outflows were an increase in trade and otherreceivables of ¥776 million and income taxes paid of ¥122 million.
(Cash flows from investing activities)
Net cash used in investing activities for the first six months of the current fiscal year was ¥226 million,a decrease of ¥265 million year on year. The main factors affecting cash outflows were purchase of property,
plant and equipment of ¥229 million.
(Cash flows from financing activities)
Net cash used in financing activities for the first six months of the current fiscal year was ¥745 million,
an increase of ¥119 million year on year. The main factor affecting cash outflows was dividends paid of ¥444
million and repayments of long-term borrowings of ¥250 million.

(4) Explanation of Consolidated Financial Results Forecast and Other Forward-Looking Information
There are no revisions to the full year consolidated financial results forecasts announced in the
consolidated financial results on May 12, 2023.

42. Condensed Quarterly Consolidated Financial Statements and Primary Notes(1) Condensed Quarterly Consolidated Statement of Financial Position(Thousand yen)
As ofMarch 31, 2023

As of
September 30, 2023

AssetsCurrent assets
Cash and cash equivalents

2,063,796

2,409,921

Trade and other receivables

2,450,073

3,213,987

Inventories

3,406,646

2,368,656

Other current assets

41,56030,579Total current assets

7,962,077

8,023,145

2,403,561

2,360,726

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

240,048

226,748

Goodwill

9,221,769

9,221,769

Intangible assets

1,387,641

1,370,519

Other financial assets

68,25985,082Other non-current assets

11,537

10,923

Total non-current assets

13,332,817

13,275,771

21,294,895

21,298,916

Total assets5

(Thousand yen)
As ofMarch 31, 2023

As of
September 30, 2023

Liabilities and equity
Liabilities
Current liabilities
Trade and other payables

664,207799,840

4,242,189

3,996,343

Income taxes payable

122,676

190,000

Other financial liabilities

89,51075,753

Other current liabilities

122,936

300,991

Total current liabilities

5,241,520

5,362,928

Borrowings

Non-current liabilities
Provisions

45,12245,154

Other financial liabilities

170,269

158,884

Deferred tax liabilities

281,743

265,938

Other non-current liabilities

3,900

3,900

Total non-current liabilities

501,035

473,878

5,742,555

5,836,806

Share capital

153,576

153,576

Capital surplus

6,918,346

6,918,346

Retained earnings

8,621,667

8,516,295

Treasury shares(151,505)(151,505)

3,710

15,524

15,545,795

15,452,238

Total liabilities
EquityOther components of equity
Total equity attributable to owners of parent
Non-controlling interests
Total equity
Total liabilities and equity

6

6,543

9,871

15,552,339

15,462,109

21,294,895

21,298,916

(2) Condensed Quarterly Consolidated Statements of Profit or Loss and Comprehensive Income
Condensed Quarterly Consolidated Statement of Profit or Loss
For the Six-Month Period(Thousand yen)
For the six months ended
September 30, 2022

For the six months ended
September 30, 2023

Revenue

8,909,122

6,621,880

Cost of sales(6,758,992)(5,154,855)

Gross profit

2,150,130

1,467,025

Selling, general and administrative expenses(1,026,445)(944,691)

Other income

6,726

18,178Other expenses(17,390)(19,813)

Operating profit

1,113,020

520,699

Finance income

265

473

Finance costs(35,886)(24,465)

Profit before tax

1,077,399

496,707

Income tax expense(325,095)(154,070)

Profit752,303342,637

744,058

339,763

8,245

2,873

752,303342,637

Basic earnings per share (yen)

53.53

24.43

Diluted earnings per share (yen)

53.52

-

Profit attributable to
Owners of parent
Non-controlling interests
ProfitEarnings per share7

Condensed Quarterly Consolidated Statement of Comprehensive Income
For the Six-Month Period(Thousand yen)
For the six months ended
September 30, 2022
Profit

For the six months ended
September 30, 2023

752,303342,637

618

3,201

618

3,201

3,680

925

-

(1,636)

3,680

(710)

4,299

2,490

756,602345,128

Owners of parent

746,553

341,801

Non-controlling interests

10,0483,327

Comprehensive income

756,602345,128

Other comprehensive income
Items that will not be reclassified to profit or loss
Net change in fair value of equity instruments
designated as 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 to8

(3) Condensed Quarterly Consolidated Statement of Changes in Equity
For the Six Months Ended September 30, 2022 (From April 1, 2022 to September 30, 2022)(Thousand yen)
Other components of equity
Financial
Exchange
assetsdifferences
measured atonfair value
Totaltranslation ofthrough otherforeigncomprehensive
operations
incomeTotal equity
Nonattributable
controllingto owners ofinterests
parentSharecapitalCapitalsurplusRetainedearnings

Treasuryshares153,576

6,919,802

8,211,397(163,101)

(138)

9,203

Profit--744,058

-

-

-

-

744,058

8,245

752,303

Othercomprehensive
income

-

-

-

-

618

1,877

2,495

2,495

1,803

4,299

Comprehensive
income--744,058

-

618

1,877

2,495

746,553

10,048756,602

Dividends--(597,517)

-

-

-

-

(597,517)-(597,517)

Share-based
paymenttransactions

-

(131)

-

7,971

-

-

-

7,839

-

7,839

Total transactions
with owners

-

(131)

(597,517)

7,971

-

-

-

(589,678)-(589,678)

153,576

6,919,671

8,357,937(155,130)480

11,081

Balance at
beginning of
periodBalance at
end of period

9,065 15,130,740

11,561 15,287,616

Equity27,840 15,158,581

37,889 15,325,505

For the Six Months Ended September 30, 2023 (From April 1, 2023 to September 30, 2023)(Thousand yen)SharecapitalBalance at
beginning of
periodCapitalsurplusRetainedearnings

Other components of equity
Financial
Exchange
assetsTreasury measured at differencesonCash flow
sharesfair valuetranslation hedges
through otherof foreign
comprehensive
operations
income153,576 6,918,346 8,621,667 (151,505)

2,025

9,825

(8,140)Total equity
Nonattributable
controllingto owners ofinterests
parentTotal

3,710 15,545,795

Equity6,543 15,552,339

Profit--339,763

-

-

-

-

-

339,763

2,873

342,637

Other
comprehensive
income

-

-

-

-

3,201

472

(1,636)

2,037

2,037

453

2,490

Comprehensive
income--339,763

-

3,201

472

(1,636)

2,037

341,801

3,327

345,128

Dividends-- (445,135)

-

-

-

-

-

(445,135)-(445,135)

Transfers to
non-financial
assets

-

-

-

-

-

-

9,777

9,777

9,777

-

9,777

Total transactions
with owners-- (445,135)

-

-

-

9,777

9,777

(435,357)-(435,357)

153,576 6,918,346 8,516,295 (151,505)

5,227

10,297-

Balance at
end of period

915,524 15,452,238

9,871 15,462,109

(4) Condensed Quarterly Consolidated Statement of Cash Flows(Thousand yen)
For the six months ended
September 30, 2022

For the six months ended
September 30, 2023

Cash flows from operating activities
Profit before tax

1,077,399

496,707

Depreciation and amortization

302,831279,883

Finance income and finance costs

35,621

23,991

Loss (gain) on sale of fixed assets(445)(12,723)

11

35

Loss on disposal of property, plant and equipment
Share-based payment expenses

2,734

1,184

Decrease (increase) in inventories(595,811)

1,037,990

Decrease (increase) in trade and other receivables(1,188,642)(776,844)

Increase (decrease) in trade and other payables

141,718

143,205

Other

193,061

259,098

Subtotal(31,520)

1,452,530

Interest and dividends received

265

473

Interest paid

(24,526)(14,241)

Income taxes paid

(418,163)(122,669)

Net cash provided by (used in) operating activities(473,944)

1,316,093

Cash flows from investing activities
Proceeds from sale of property, plant and equipment

35

13,393Purchase of property, plant and equipment(461,213)(229,131)

Purchase of intangible assets(23,915)(3,850)

Payments for acquisition of financial assets(6,009)(6,291)

(3)

(164)

(491,106)(226,043)

Proceeds from short-term borrowings

425,646-

Repayments of short-term borrowings(129,612)-

Repayments of long-term borrowings(250,000)(250,000)

Other
Net cash provided by (used in) investing activities
Cash flows from financing activities

Payments of financial expenditures(5,167)(4,961)Dividends paid

(598,248)(444,669)

Repayments of lease liabilities(68,599)(45,375)(625,982)(745,006)

Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents

7,505

1,080

(1,583,528)

346,124

Cash and cash equivalents at beginning of period

3,460,569

2,063,796

Cash and cash equivalents at end of period

1,877,041

2,409,921

10

(5) Notes to Condensed Quarterly Consolidated Financial Statements(Notes on going concern assumption)
There is no relevant information.

(Significant subsequent events)
There is no relevant information.

11