Please note this report is a summary of disclosure documents prepared for the convenience of shareholders and other investors outside Japan. In the eventof any discrepancy between the translation and the Japanese original, the latter shall prevail.

April 30, 2024

Consolidated Financial Statements
for the Fiscal Year Ended March 31, 2024
[Japanese standard]
INES Corporation
Listing:
Representative:
Contacts:

Tokyo Stock Exchange (Code: 9742)
Shuji Hattori, President and Representative Director
Satoshi Numazaki, General Manager, Corporate Staff Division
Tel: +81-3-6775-4401
Head Office:1-38-11, Nihonbashi Kakigara-cho, Chuo-ku, Tokyo 103-0014, Japan
Tel. +81-3-6775-4401
URL
https://www.ines.co.jp/en/
Scheduled date of annual general meeting of shareholders:June 25, 2024
Scheduled date to commence dividend payments:
June 26, 2024
Scheduled date to file annual securities report:
June 25, 2024
Preparation of supplementary material on financial results:
Yes
Holding of financial results briefing:
Yes (for institutional investors and analysts)

1. Consolidated Financial Results for the Fiscal Year Ended March 31, 2024
(April 1, 2023 to March 31, 2024)(1) Consolidated Operating Results(Million yen, figures in percentages denote year-on-year changes.)
Profit attributable toOperating profit
Ordinary profit
owners of parent

Net sales
Fiscal year ended March 31, 2024

40,557(4.4%)

2,877(24.3%)

2,732(29.6%)

1,795(29.3%)

Fiscal year ended March 31, 2023

42,404

5.9%

3,801

93.7%

3,882

88.4%

2,541

95.4%

(Note) Comprehensive income

Fiscal year ended March 31, 2024: ¥2,529 million (1.5%)
Fiscal year ended March 31, 2023: ¥2,492 million (76.1%)

Profit per share (Yen)

Fully diluted profit
per share (Yen)Profit/Shareholders’ equity

Ordinary profit/
Total assets

Fiscal year ended March 31, 2024

86.33

―

4.8%

5.3%

7.1%

Fiscal year ended March 31, 2023

122.20

―

7.2%

8.1%

9.0%

(Reference) Equity in earnings of affiliated companies

Fiscal year ended March 31, 2024: ¥― million
Fiscal year ended March 31, 2023: ¥― million(2) Consolidated Financial Position

Operating profit/
Net sales(Million yen)
Net assets per share(Yen)

Total assets

Net assets

Equity ratio (%)

As of March 31, 2024

54,42737,79069.4

1,816.54

As of March 31, 2023

48,52336,28674.8

1,744.92(Reference) Shareholders’ equity

As of March 31, 2024: ¥37,790 million
As of March 31, 2023: ¥36,286 million(3) Consolidated Cash Flow Situation
Cash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities(Million yen)
Cash and cash
equivalents at end of
periodFiscal year ended March 31, 2024

2,142

(9,987)

3,948

5,265

Fiscal year ended March 31, 2023

2,325

(2,045)

(849)

9,162

1

2. Dividends
Dividends per share (Yen)Dividend payout
ratio(consolidated)(%)

Dividends/
Net assets(consolidated)(%)

Fiscal year
end

AnnualTotal dividends(annual)(million yen)

―

25.00

45.00

935

36.8

2.6

25.00

―

25.00

50.00

1,040

57.9

2.8

―

―

―

55.00

End of Q1

End of Q2

Fiscal year ended March
31, 2023―

20.00

Fiscal year ended March
31, 2024―

Fiscal year ending March
31, 2025 (Forecast)―End of Q3

42.4(Note) The dividend forecasts for the end of the second quarter and the fiscal year end of the fiscal year ending March 31, 2025 are to be determined.

3. Forecasts for Consolidated Financial Results for the Fiscal Year Ending March
31, 2025 (April 1, 2024 to March 31, 2025)
Net sales
Full year

44,000(Million yen, figures in percentages denote year-on-year changes.)
Profit attributable toProfit per share (Yen)
Ordinary profit
owners of parent

Operating profit

8.5

4,000

39.0

4,000

46.4

2,700

50.3

129.79* Notes(1) Significant changes in subsidiaries during this fiscal year under review (changes in subsidiaries causing a change in thescope of consolidation): No(2) Changes in accounting policies and changes or restatement of accounting estimates
1. Changes in accounting policies associated with the revision of accounting standards, etc. No
2. Changes in accounting policies other than 1.: No
3. Changes in accounting estimates: Yes
4. Restatement: No(3) Number of shares outstanding (common shares)
1. Number of shares outstanding at the term end (including treasury shares)
Fiscal year ended March 31, 2024:
20,900,000 sharesFiscal year ended March 31, 2023:
20,900,000 shares
2. Number of treasury shares at the term end
Fiscal year ended March 31, 2024:
Fiscal year ended March 31, 2023:

96,727 shares
104,676 shares

3. Average number of shares outstanding
Fiscal year ended March 31, 2024:
Fiscal year ended March 31, 2023:

20,802,125 shares
20,794,815 shares* These financial statements are not subject to audit procedures performed by certified public accountants or
audit corporations.
* Explanation regarding the proper use of results forecasts and other important notes(Disclaimer regarding forward-looking statements)
Forward-looking statements such as results forecasts provided in this document are prepared based on currently
available information and assumptions that are deemed reasonable, but the Company does not intend to guarantee
their achievement. Actual results may differ significantly from the above forecasts for various reasons. For
conditions regarding the assumptions for results forecasts and notes on the use of results forecasts, etc., please referto page 4 of the accompanying materials “1. Outline of Operating Results, (3) Future Outlook.”21. Outline of Operating Results(1) Outline of Operating Results for the Fiscal Year ended March 31, 2024(i) Initiatives in the fiscal year under review
During the fiscal year under review, the Company operated its businesses with a focus on the standardization of the
WebRings information system for local governments, the enhancement of DX solutions and the advancement ofsustainable management to bring the 2023 Medium-term Management Plan to a successful conclusion in its final
fiscal year.
Standardization of the WebRings information system for local governments
In the Public sector as the Company’s core business area, the deadline for the standardization of local authority
information systems was extended. That affected the plan and the profit. The Company is preparing for the
standardization of local authority information systems that will begin in earnest from FY2024. These preparations
include the launch of a quality management department. To support an unfailing transition, the Company is set tobegin introduction work in the second half of FY2024.
Enhancement of DX solutions
In accordance with its Medium-term Management Plan, the Company worked to transform into a digitaltransformation (DX) company group that contributes to the creation of a sustainable society with its strengths in its
strong customer base, extensive service lineup and comprehensive capabilities of its group.
Among other initiatives, the Company took steps to broaden the range of DX solutions related to local governments’
DX. It also stepped up alliances with the Mitsubishi Research Institute Group as a business and capital tie-up partner
and with other companies. In addition, it expanded sales of AI Consultation Partner, a solution for local governmentswith the use of artificial intelligence (AI) that it has been marketing for some time, and provided DX services for
the Private sector.
Advancement of Sustainable Management
As it did in the previous fiscal year, the Company sought to develop its human resources, who underpin sustainable
management. To this end, the Company continued to focus on improving DX literacy under a technical staff
development system and on strengthening and developing personnel for DX by providing intensive education to
selected staff members.
In the fiscal year under review, the Company transformed into a company with an audit and supervisory committee.
It strengthened its supervisory and auditing functions to improve its corporate governance.
The Company established the Yaesu Office near Tokyo station in May 2023. The office is positioned as a hub ofsales operations of the Company. The office serves as the central location for all Company operations. In September
2023, the Company acquired an office building near Suitengumae Station. The office building will have theheadquarters functions of INES Group companies. With this, the Group aims to make decisions about Groupmanagement more promptly, improve productivity, facilitate communication, strengthen the management base, andenhance corporate value.
(ii) Operating results of the fiscal year under review
Consolidated net sales for the fiscal year under review declined 4.4% year on year, to ¥40,557 million. Consolidated
net sales on a sector-by-sector basis are as shown in the table below.
Net sales in the Public sector came to ¥18,504 million, a decrease of 6.8% year on year, chiefly due to a decreasein demand for replacement prior to the standardization.
Net sales in the Financial sector stood at ¥7,765 million, which was almost unchanged from the previous year, or
up 2.0% year on year.
Net sales in the Industrial sector declined 4.3% year on year, to ¥14,287 million, mainly reflecting the reduction of
backbone system development projects.
Looking at sales by project and service category, sales from system development decreased and those from system
maintenance increased, mainly because of the shift of development projects in the previous fiscal year to a
maintenance phase in the Public sector.
Operating profit decreased 24.3% year on year to ¥2,877 million, ordinary profit declined 29.6% year on year to¥2,732 million, and profit attributable to owners of parent also decreased 29.3% year on year to ¥1,795 million.
3

Each of these decreases were attributable primarily to a sales decline in the Public sector, a hike in costs associatedwith the new sales office launch and the posting of one-time expenses linked to the head office relocation.
Consolidated net sales by sector

Category/Term(Million yen)Previous consolidated fiscal year
From April 1, 2022
until March 31, 2023
AmountPublicComposition ratio(%)

19,853

46.8

Financial

7,616

General industry

14,934

Total

42,404

Consolidated fiscal year
under review
From April 1, 2023
until March 31, 2024
AmountYear-on-year change(%)

Composition ratio(%)

18,504

45.7

(6.8)

18.0

7,765

19.1

2.0

35.2

14,287

35.2

(4.3)

100.0

40,557

100.0

(4.4)

(Note) Effective from the fiscal year under review, net sales of the Group companies that were included in Other previously have been
reclassified and presented in the Public, Financial and General Industry sectors due to the restructuring of the Group’sbusinesses. Net sales in the previous fiscal year are reclassified and presented in the same way.

Consolidated net sales by product/service

Category/Term(Million yen)Previous consolidated fiscal year
From April 1, 2022
until March 31, 2023
AmountComposition ratio(%)

Consolidated fiscal year
under review
From April 1, 2023
until March 31, 2024
AmountYear-on-year change(%)

Composition ratio(%)

System development

17,33340.9

16,371

40.3

(5.6)

System operation

14,83135.0

13,903

34.3

(6.3)

System maintenance

4,853

11.4

4,984

12.3

2.7

Sales of information equipment

1,080

2.5

1,245

3.1

15.4

Other

4,304

10.2

4,051

10.0

(5.9)

Total

42,404100.0

40,557

100.0

(4.4)

(2) Outline of Financial Position for the Fiscal Year Ended March 31, 2024
(i) Situation of assets, liabilities and net assets
Looking at the financial position at the end of the fiscal year under review, total assets stood at ¥54,427 million, an
increase of ¥5,904 million from the end of the previous fiscal year.
Current assets decreased ¥4,640 million, to ¥20,283 million, primarily due to decreases in cash and deposits. Noncurrent assets increased ¥10,544 million to ¥34,143 million, primarily due to rises in land and construction inprogress following the acquisition of an office building.
Current liabilities increased ¥1,186 million to ¥7,601 million, due mainly to a surge in the current portion of longterm borrowings. Non-current liabilities increased ¥3,213 million to ¥9,035 million, mainly reflecting an increasein long-term borrowings.
Net assets increased ¥1,503 million from the end of the previous fiscal year, to ¥37,790 million mainly due to theposting of profit attributable to owners of parent.
(ii) Cash flow situation
At the end of the fiscal year under review, cash and cash equivalents (“Cash”) decreased ¥3,896 million from theend of the previous fiscal year, to ¥5,265 million.
The status of each cash flow segment and contributing factors for the fiscal year under review are as follows.
(Cash flows from operating activities)
Net cash provided by operating activities decreased 7.9% year on year, to ¥2,142 million. This was mainly due tothe posting of profit before income taxes of ¥2,672 million.

4

(Cash flows from investing activities)
Net cash used in investing activities increased 388.3% year on year, to ¥9,987 million. This was mainly attributable
to expenses for the purchase of property, plant and equipment of ¥9,626 million and proceeds from the sale ofsecurities of ¥2,300 million.
(Cash flows from financing activities)
Net cash provided by financing activities stood at ¥3,948 million (in comparison with net cash used of ¥849 million
in the previous fiscal year). The rise was mainly due to proceeds from long-term borrowings of ¥5,000 million.

(3) Future Outlook
In Japan and overseas, the situation will remain uncertain, due chiefly to geopolitical risks, financial policies ofJapan and the United States, together with the risk of a sustained weakening of the yen. For the foreseeable future,
however, the economy is expected to remain on a moderate recovery trend, with the help of salary increases in thecorporate sector in response to soaring goods prices and various national governmental policies and measures.
Under these circumstances, the Company started the 2026 Medium-term Management Plan in a bid to achievetransformation into a DX company through (1) standardization of the information system for local governments, (2)investment in the development of next-generation solutions, and (3) sophistication of business foundations with theuse of AI. The following presents the forecasts for consolidated financial results for the fiscal year ending March
31, 2025, the first fiscal year of the plan.
[Forecasts for consolidated financial results for the fiscal year ending March 31, 2025](Million yen)

Net sales

Operating profit

Ordinary profit

Profit attributable toowners of parent

Year ending March 31, 2025

44,000

4,000

4,000

2,700

Year ended March 31, 2024

40,557

2,877

2,732

1,795

8.5

39.0

46.4

50.3

Year on year change (%)

With respect to the annual dividend forecasts for the fiscal year ending March 31, 2025, the Company expects topay ¥55 per share, up ¥5 per share, in view of its dividend policy and the financial results forecasts mentioned above.
Dividends per share (Yen)End of Q2

Fiscal year end

AnnualYear ending March 31, 2025 (Forecast)

―

―

55.00

Year ended March 31, 2024

25.00

25.00

50.00

Increase/decrease

―

―

5.00

(Note) The dividend forecasts for the end of the second quarter and the fiscal year end of the fiscal year ending March 31, 2025 are to
be determined.

(Caution on future forecast information)
Forward-looking statements such as results forecasts provided in this document are prepared based on currently
available information and assumptions that are deemed reasonable, but the Company does not intend to guarantee
their achievement. Actual results may differ significantly from the above forecasts for various reasons.

2. Basic Stance regarding Selection of Accounting Principles
In consideration of comparability with industry peers in Japan, the INES Group has the policy to prepare
consolidated financial statements according to the Japanese accounting standards in the foreseeable future.
Going forward, the Group will examine the possibility of applying international accounting standards in light oftrends and other factors in the application among Japanese companies.

5

Consolidated Balance Sheets
As of March 31, 2023 and March 31, 2024

ASSETS
Current assets
Cash and deposits
Notes and accounts receivable - trade, andcontract assets
Securities
Work in process
Raw materials and supplies
Prepaid expenses
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net
LandConstruction in progress
Total property, plant and equipment
Intangible assets
Software
Other
Total intangible assets
Investments and other assets
Investment securities
Long-term prepaid expenses
Deferred tax assets
Other
Total investments and other assets
Total non-current assets
Total assets

FY2022(As of March 31, 2023)(Million yen)
FY2023(As of March 31, 2024)

9,376

6,479

11,96011,855

2,300
268
66
454
514
(16)
24,924

*1

6

―
*2

383
69
431
1,084
(19)
20,283

3,710(3,204)506
4,583(3,494)
1,089
3
1
1,600

1,479
(628)
851
3,996
(2,971)
1,025
5,299
4,587
11,764

2,241
24
2,265

2,498
23
2,522

13,236
678
4,490
1,328
19,733
23,59948,523*1

13,535
767
4,147
1,407
19,85734,14354,427

Consolidated Balance Sheets
As of March 31, 2023 and March 31, 2024
FY2022(As of March 31, 2023)
LIABILITIESCurrent liabilities
Accounts payable - trade
Current portion of long-term borrowings
Accrued expenses
Income taxes payable
Accrued consumption taxes
Advances received
Provision for bonuses
Provision for bonuses for directors (and otherofficers)
Provision for losses on orders received
Asset retirement obligations
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Provision for retirement benefits for directors(and other officers)
Net defined benefit liability
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities
NET ASSETS
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Remeasurements of defined benefit plans
Total accumulated other comprehensive
incomeTotal net assets
Total net assets and liabilities(Million yen)
FY2023(As of March 31, 2024)

2,006
1,261
908
363
191
959

1,909
416
1,297
722
272
129
959

73

80

―

48
601
6,414

49
230
1,533
7,601

―

4,583

102

88

4,608
276
834
5,822
12,237

3,411
154
798
9,035
16,637

15,00010,10011,682(155)
36,627

15,00010,09912,438(140)
37,398

(179)

54

(162)

336

(341)

391

36,28648,52337,79054,427―7*2

Consolidated Statement of Income
For the fiscal year ended March 31, 2023 and 2024

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividends income
Dividend income of insurance
Other
Total non-operating income
Non-operating expenses
Interest expenses
Loss on investments in investment partnerships
Office relocation expenses
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sale of investment securities
Gain on liquidation of subsidiaries and associates
Total extraordinary income
Extraordinary losses
Loss on retirement of non-current assets
Impairment loss
Special retirement benefits
Other
Total extraordinary losses
Profit before income taxes
Income tax and others
Adjustment of corporate taxes
Total income taxes
ProfitProfit attributable to owners of parent

FY2022(April 1, 2022 toMarch 31, 2023)
42,404*4
32,306
10,097*1, *2
6,296
3,801(Million yen)
FY2023(April 1, 2023 toMarch 31, 2024)
40,557*4
30,827
9,729*1, *2
6,851
2,877

51
11
8
14
85

52
27
14
17
112

0
1

11
8
233
3
257
2,732

―

3
5
3,882

5
18
24

―
―
―
*3

0
181
―
―

182
3,699
1,131
27
1,158
2,541
2,541

8

*3

19
―

59
5
84
2,672
860
16
877
1,795
1,795

Consolidated Statement of Comprehensive Income
For the fiscal year ended March 31, 2023 and 2024

ProfitOther comprehensive income
Valuation difference on available-for-salesecurities
Remeasurements of defined benefit plans, net oftax
Total other comprehensive income
Comprehensive income
Comprehensive income attributable
Comprehensive income attributable to owners ofparentFY2022(April 1, 2022 toMarch 31, 2023)
2,541(Million yen)
FY2023(April 1, 2023 toMarch 31, 2024)
1,795

(212)

234

164

499

*

(48)
2,492

2,492

9

*

733
2,529

2,529

Consolidated Statements of Changes in Shareholders’ Equity
Previous fiscal year (April 1, 2022 to March 31, 2023)(Million yen)
Shareholders’ equity
Capital stock
Balance at beginning of period

15,000Capital surplus
14,592Retained earnings
9,973

Treasury shares(4,651)

Total shareholders’equity34,913

Changes during period
Dividends of surplus

(831)

(831)

Profit attributable to owners of parent

2,541

2,541

Purchase of treasury shares

(1)

(1)

0

6

6

(4,491)

4,491–

Disposal of treasury shares
Cancellation of treasury shares
Changes in items other thanshareholders’ equity (net)Total changes during period
Balance at end of period–(4,491)

1,709

4,495

1,713

15,00010,10011,682(155)

36,627

Accumulated other comprehensive income
Valuation difference Remeasurements ofon available-fordefined benefit
sale securities
plans
Balance at beginning of period

32

(326)

Total accumulated
othercomprehensive
income(293)

Total net assets

34,620Changes during period
Dividends of surplus(831)

Profit attributable to owners of parent

2,541

Purchase of treasury shares(1)

Disposal of treasury shares

6

Cancellation of treasury shares–

Changes in items other thanshareholders’ equity (net)(212)

Total changes during period

(212)

164

(48)

1,665

Balance at end of period

(179)

(162)

(341)

36,286

164

10

(48)

(48)

Fiscal year under review (April 1, 2023 to March 31, 2024)(Million yen)
Shareholders’ equity
Capital stock
Balance at beginning of period

15,000Capital surplus
10,100Retained earnings
11,682

Treasury shares(155)

Total shareholders’equity36,627

Changes during period
Dividends of surplus(1,039)(1,039)Profit attributable to owners of parent

1,795

1,795

Purchase of treasury shares
Disposal of treasury shares

(1)

(2)

(2)

18

17

Changes in items other thanshareholders’ equity (net)Total changes during period
Balance at end of period

–

(1)

755

15

770

15,00010,09912,438(140)

37,398

Accumulated other comprehensive income
Valuation difference Remeasurements ofon available-fordefined benefit
sale securities
plans
Balance at beginning of period

(179)

(162)

Total accumulated
othercomprehensive
income(341)

Total net assets

36,286

Changes during period
Dividends of surplus(1,039)Profit attributable to owners of parent

1,795

Purchase of treasury shares(2)

Disposal of treasury shares

17

Changes in items other thanshareholders’ equity (net)

234

499

733

733

Total changes during period

234

499

733

1,503

Balance at end of period

54

336

391

37,79011

Consolidated Statement of Cash Flow
For the fiscal year ended March 31, 2023 and 2024
FY2022(April 1, 2022 toMarch 31, 2023)
Cash flows from operating activities
Profit before income taxes
Depreciation
Impairment loss
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for bonuses for directors(and other officers)
Increase (decrease) in provision for losses on orders
received
Increase (decrease) in provision for retirement benefits for
directors (and other officers)
Increase (decrease) in retirement benefit liability
Loss (gain) on liquidation of subsidiaries and associates
Loss on retirement of non-current assets
Loss (gain) on sale of investment securities
Office relocation expenses
Special retirement benefits
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Decrease (increase) in other assets
Increase (decrease) in trade payables
Increase (decrease) in other liabilities
Other, net(Subtotal)
Income taxes refund
Income taxes paid
Net cash provided by (used in) operating activities

12(Million yen)
FY2023(April 1, 2023 toMarch 31, 2024)

3,699
2,052
181
(87)

2,672
1,993

6

7

(89)

1

(9)

(13)

(271)

(495)
(18)
19
(5)
233
59
42
(117)
16
(297)
(724)
26
3,398
6
(1,262)
2,142

―

0
―
―
―

(2,730)
(45)
(20)
(146)
557
37
3,134
14
(823)
2,325

―

0

(Million yen)
FY2023(April 1, 2023 toMarch 31, 2024)

FY2022(April 1, 2022 toMarch 31, 2023)
Cash flows from investing activities
Net decrease (increase) in time deposits
Net decrease (increase) in short-term investment securities
Purchase of property, plant and equipment
Purchase of intangible assets
Purchase of long-term prepaid expenses
Purchase of investment securities
Proceeds from sale of investment securities
Proceeds from liquidation of subsidiaries and associates
Payments of leasehold and guarantee deposits
Proceeds from refund of leasehold and guarantee deposits
Payments for asset retirement obligations
Other, net
Net cash provided by (used in) investing activities
Cash flows from financing activities
Proceeds from long-term borrowing
Repayments of lease obligations
Purchase of treasury shares
Cash dividends paid
Net cash provided by (used in) financing activities
Net increase (decrease) in cash and cash equivalents
Beginning cash and cash equivalent balanceEnding cash and cash equivalent balance

13

0(1,000)2,300(9,626)(1,048)
(460)
(10)
5
30
(168)
87
(99)
1
(9,987)

―

(958)
(667)
(212)
(2)
―
―

(272)
55
(1)
13
(2,045)
―

*

(16)
(1)
(831)
(849)
(569)
9,731
9,162

*

5,000
(11)
(2)
(1,037)
3,948(3,896)9,162
5,265