(Ticker code: 4662)

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Fiscal 2014
(Year ended March 2014)

Financial Results Presentation
Focus Systems Corporation
Friday, May 30, 2014
This document uses information available as of March 31, 2014, and contains forward-looking statements that represent
management’s expectations or beliefs relating to future events. Actual results could differ materially from those stated or implied inthese forward-looking statements. The Focus Systems Group does not guarantee the information’s accuracy.
http://www.focus-s.com
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CopyrightⒸ Focus Systems Corporation

ContentsI. Financial results for fiscal 2014 ended March 31, 2014

P 3 ～ P 14

II. Projections for Fiscal 2015

P15 ～ P16

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I. Financial Results for Fiscal 2014
Ended March 31, 2014

3CopyrightⒸ Focus Systems Corporation

Management policies for fiscal 2014

(1) Reinforce collaboration among organizational units(2) Clarify priorities of business operations(3) Accommodate changes in business climate(4) Strengthen marketing activities

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Overview of Financial Results(¥ million)

Net salesYear ended
March 2013

Year ended
March 2014

Year ended
March 2014

ResultsPlans

Results

Year-on-year change

Changes comparedwith plan

AmountRatio

AmountRatio

12,353

12,50014,146

1,793

14.5%

1,646

13.2%

Public Sector

4,311

4,437

4,668

356

8.3%

231

5.2%

Private Sector

7,461

7,456

8,440

978

13.1%

984

13.2%

580

607

1,037

456

78.7%

430

70.8%

Operating income (loss)

439

300

887

448

102.1%

587

195.7%

Ordinary income (loss)

416

250

849

433

104.1%

599

239.6%Net income

241

100

455

214

89.0%

355

355.0%

Security Equipment(Note) Although the Company made a modification on February 7, 2014 to its financial results forecast for the year ended March 2014, the forecast figures indicated in the“Year ended March 2014: Plans” column of the above table are those announced on May 9, 2013.

• Achieved results significantly surpassing plans in all of the private sector, public sector and security
equipment businesses• Cash dividend per share (planned): 20 yen (including 10 yen as special dividend)
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Nonconsolidated Balance Sheets(¥ million)
As of Mar. 31,
2012

As of Mar. 31,
2013

As of Mar. 31,
2014

Current Assets

5,444

5,559

6,428

Noncurrent Assets

7,764
3,781

5,636
3,746

5,408
3,741

4438

60

Investments and Other Assets

3,937

1,851

1,606

Total Assets

13,208

11,195

11,837

Noncurrent Liabilities

3,942
3,218

3,769
2,556

4,102
2,705

Total Liabilities

7,161

6,326

6,807

2,905
1,468

2,905
1,468

2,905
1,468

199
(434)
1,908

367
(706)
833

719
(706)
642

Total Net Assets

6,047

4,868

5,029

Total Liabilities and Net Assets

13,208

11,195

11,837Item(ASSETS)

Property, Plant and Equipment
Intangible Assets

Total assets were up ¥641 million from a year earlier, largely becauseof increases of ¥513 million in cash and deposit and ¥483 million inaccounts receivable – trade, against a decrease of ¥297 million in
investment securities.

(LIABILITIES)Current Liabilities(NET ASSETS)
Capital stock
Capital surplus

Retained earnings
Treasury stock
Valuation difference on availablefor-sale securities

6

Total liabilities were up ¥481 million from a year earlier, principally
because of increases of ¥363 million in income taxes payable and¥324 million in bonds payable, against a decrease of ¥184 million in
short-term loans payable.

Net assets were up ¥160 million from a year earlier, mainly due to anincrease of ¥351 million in retained earnings brought forward, against
a decrease of ¥191 million in the valuation difference on available-forsale securities.

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Nonconsolidated Income Statements(¥ million)
FY2012(ended Mar. 31,2012)

FY2013(ended Mar. 31,2013)

FY2014(ended Mar. 31,2014)

Net Sales

11,90912,35314,146

Cost of Sales

10,453

10,796

12,181Gross Profit1,455

1,557

1,965

SG & A Expenses

1,503

1,118

1,077

Operating Income (Loss)

(47)

439

887

Non-operating Income

80

6454

Non-operating Expenses

91

8792

Ordinary Income (Loss)

(58)

416

849

Extraordinary Income

569

532

－

Extraordinary Loss

9727

3

Income before Income Taxes

501

221

846

Income Taxes

349

(19)

390

Net Income

151

241

455

Item

7

Net sales climbed ¥1,792 million from the previous fiscalyear. Sales grew for all segments, with increases of ¥356
million for the public sector business, ¥978 million for theprivate sector business and ¥456 million for the security
equipment business.
Cost of sales increased ¥1,384 million, with gross profit risingby ¥407 million.

In association with the increase in net sales, operating
income increased ¥448 million from the previous fiscal year.

There was no extraordinary income generated for the fiscalyear.
The extraordinary income generated in the previous fiscal
year and the fiscal year before the previous fiscal year had
been primarily due to gain on sales of investment securities
and insurance premiums refunded cancellation.
Extraordinary loss was down ¥723 million from the previousfiscal year.
The extraordinary loss generated in the previous fiscal year
had been mainly due to directors’ retirement benefits.
The Company thus posted a net income of ¥455 million, up¥214 million from the previous fiscal year.

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Operating Results
Net Sales

Gross Profit(¥ million)(¥ million)

1,965

16,00014,0002,000

14,146

11,9091,800

12,3531,600

12,000

1,557

1,455

1,400

10,000

1,200

8,000

1,000
800

6,000

600
4,000

400

2,000

200

00
FY2012FY2013

FY2012FY2014

8FY2013

FY2014

CopyrightⒸ Focus Systems CorporationOperating Results

Ordinary Income (Loss)(¥ million)

Operating Income (Loss)(¥ million)
887

Net Income(¥ million)

849

900

900

900

800

800

800

700

700

700

600

600

600

500

500

439

500

416

400

400

400

300

300

300

200

200200

455

241
151
100

100(47)

0100

(58)

0(100)

0(100)FY2012FY2013

FY2014(100)

FY2012FY2013

9FY2014

FY2012FY2013

FY2014

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Statements of Changes in Shareholders’ equity(¥ million)
Valuation andtranslation
adjustments

Shareholders’ equity
Retainedearnings

Capital surplus

Capitalstock

Balance as of March 31,2013

2,905

Legal capitalsurplus749

Other capital Total capitalsurplussurplus

718

1,468

Other retained
earnings

Treasury
stock

Total
shareholders’equityValuationdifference on
available-for-salesecurities

(706)

4,035

833

Retainedearnings brought
forward367

Total
net assets

4,868

Changes of items during theperiod
Dividends from surplus

(103)

(103)

(103)

Net income

455

455

455

Net changes of items
other than shareholders'equity

(191)

(191)

Total changes of items
during the period－－－－351－351

(191)

160

Balance as of March 31,
2014

2,905

749

718

1,468

719(706)

4,386

642

5,029

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CopyrightⒸ Focus Systems CorporationNonconsolidated Statements of Cash Flows(¥ million)

FY2012(ended Mar. 31,2012)

FY2013(ended Mar. 31,2013)

FY2014(ended Mar. 31,2014)

Ⅰ Cash Flows from Operating Activities

314(1,020)667

Ⅱ Cash Flows from Investing Activities

442

875

(119)

Ⅲ Cash Flows from Financing Activities

6556

(32)

IV Net Increase (Decrease) in Cash and Cash Equivalents

822

(89)

514

V Cash and Cash Equivalents at Beginning of Period

1,662

2,484

2,395VI Cash and Cash Equivalents at End of Period

2,484

2,395

2,910

Item

Ⅰ Cash Flows from Operating Activities

Ⅱ Cash Flows from Investing Activities

Ⅲ Cash Flows from Financing Activities

Net cash provided by operating activitieswas ¥667 million. The main factors were¥846 million of income before incometaxes.

Net cash used in investing activities was¥119 million. The main factors were ¥44
million in purchase of property, plant andequipment, ¥41 million in purchase ofinsurance funds and ¥27 million ofpayments for guarantee deposits.

Net cash used in financing activities was¥32 million. The main factors included¥1,505 million in repayment of long-termloans payable, which offset ¥1,380 million
in proceeds from long-term loans payable.

Ⅵ Cash and Cash Equivalents at End of Period
As a result, cash and cash equivalents at year-end increased ¥514 million from beginning of period to ¥2,910 million.
11CopyrightⒸ Focus Systems Corporation

Cash Flows
Interest-bearing debt

Balance of cash and deposit(¥ billion)

7.0
6.0
5.0
4.2 billion

4.0

3.0

3.4 billion

1.5 billion

3.1 billion1.0 billion

2.0 billion
2.2 billion

1.0 billion

1.6 billion

1.2 billion

2.0

1.00.0Mar. 2005 Mar. 2006 Mar. 2007 Mar. 2008 Mar. 2009 Mar. 2010 Mar. 2011 Mar. 2012 Mar. 2013 Mar. 2014

Boosted by ¥3.2 billion in nine years
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Segment Information(¥ million)
Net sales

FY2011FY2012FY2013

FY2014

5,082

4,717

4,311

4,668

5,905

6,695

7,461

8,440

414496580

1,037

Public sector

Private sector

Security equipment

13Although conditions had remained harshsince the Democratic Party of Japancame into power as it revised plans andreduced budgets, among other matters,
sales were bolstered by an increase inpublic works projects based on the“Declaration to be the World's Most
Advanced IT Nation” proclaimed by thegovernment and other factors.

Sales grew steadily, with more orders
received primarily for infrastructurerelated businesses with the backdrop of
recovering corporate performance.
However, clients continued to bestringent in demanding cost reductions.
Strong sales were achieved forgovernment and municipal agencies
through reinforcement of anti-cybercrime
offerings. On top of strong order
reception in the first half of the fiscal year
supported by the national supplementarybudget, budget spending by government
agencies helped increase orders
received.
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Sales to Key Customers
By customer group

Public sector-related
business showedsigns of recovery

5000

NTT DATA related
IBM Japan related
CTC related
OKI related
SoftBank related
Product sales

4000
3000
2000
1000
0

FY2012FY2013

FY2014

Demand was strong
for anti-cybercrime
products

By key customer

IBM Japan-related
sales increased
dramatically

3000

2500
2000

IBM Japan
NTT DATA

1500

NTT DATA i1000CTC
WILLCOM

5000FY2012

FY2013

FY201414

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II. Projections for Fiscal 2015

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Fiscal 2015 Projections
Year ended March(¥ million )2014
Results

Year ending
March 2015
Projections

Year-on-yearchange14,146

14,500354

Operating Income

887

900

13

Ordinary Income

849

850

1Net Income

455

500

45

Net Sales

In order to further secure anticipated business opportunities, the Company plans to make investments in the next fiscal year
eyeing business expansion in the coming years.
(1) Infrastructure-related business that commands ample demand → Enhance staff capabilities(2) Operations support business → Expand market share, Business applications → Endeavor on technological expertise(3) Support for business bases → Operate organizations in an efficient and friendly manner through coordination among
respective business bases including Nagoya

Year ended March2014(¥)
Results

Year ending
March 2015
Projections

20.00

20.00

Cash Dividends per Share

PayoutRatio
27.7%

Cash dividend for fiscal year ended March 2014 (planned): ¥20 per share (¥10 for ordinary dividend and ¥10 for special dividend)
Cash dividend for fiscal year ended March 2015 (forecast): ¥20 per share (¥10 for ordinary dividend and ¥10 for special dividend)
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