Consolidated Financial Statements for the Fiscal Year ended March 31, 2024.

26-Apr-2024
These financial statements have been prepared in accordance with accounting principals generally accepted in Japan.
NEC Networks & System Integration Corporation

Stock exchange listing:Tokyo

Code number:

1973

https://www.nesic.co.jp/english/index.html
1.Consolidated Results for the Fiscal Year ended March 31, 2024
(Rounded down to the nearest million yen.)(1) Net Sales and Incomes(Percentages represent change compared with the same period of the previous fiscal year.)Net sales(¥ million)

Year-on-yearchange (%)

Operating income(¥ million)

FY ended March/24

359,505

12.1

FY ended March/23

320,802

3.4

Year-on-year change(%)

Net income
attributable toowners of theparent(¥ million)

24,684

7.5

15,32911.0

22,970(2.5)

13,813(8.0)

Year-on-yearchange (%)

Ordinary income(¥ million)

25,12010.4

22,751(1.9)（Note) Comprehensive income : FY Mar.2024 : ¥18,843 million/28.4%; FY Mar.2023 : ¥14,676 million/(13.6)%

Net income
per share (¥)

Net income pershare (diluted)(¥)

Return on equity(%)

Ordinary income/
Total assets (%)

Operatingincome/ Netsales (%)

FY ended March/24

102.91

—

10.4%

8.9%

7.0%

FY ended March/23

92.74

—

10.0%

8.8%

7.1%

（Reference)Year-on-yearchange (%)

Equity in earnings of affiliates : FY Mar.2024 : ¥11 million; FY Mar.2023 : ¥71 million(2) Financial Position
Total assets(¥ million)

Net assets(¥ million)

Owner's equity
ratio (%)

Net assets per
share (¥)

31-Mar-24

284,897

157,48153.5

1,024.09

31-Mar-23

267,000

145,71452.9

948.23c.f. Owner's equity: 31/3/2024 ¥152,556 million ; 31/3/2023 ¥141,242 million(3) Cash FlowsNet cash provided by (used in)operating activities(¥ million)

Net cash provided by (used in)investing activities(¥ million)

Net cash provided by (used in)financing activities(¥ million)

Cash and cash equivalents at endof year(¥ million)

FY ended March/24

20,228(4,848)(10,520)

73,507

FY ended March/23

2,816(4,934)(9,243)68,5492. Dividends
Dividends per share (¥)
1stquarter

3rdquarter

InterimYear-end

Total dividends paid
(full year, ¥million)

Full year

Payout ratio(consolidated)(%)

Dividends/Net assets(consolidated)(%)

FY ended 3/2023

—

23.00

—

23.00

46.00

6,851

49.6

5.0

FY ended 3/2024
FY ending 3/2025（Forecast)

—

24.50

—

24.50

49.00

7,299

47.6

5.0

—

28.00

—

28.00

56.00

46.3

3. Financial Forecasts for Fiscal Year ending March 31, 2025
(Percentages represent change compared to the previous corresponding period.)

Net sales

FY ending 3/2025

Operating income

Ordinary income

Net income attributable to ownersof the parent

Net income
attributable toowners of theparent pershare(¥ million)(%)(¥ million)(%)(¥ million)(%)(¥ million)

(%)

(¥)

365,000

1.5

29,00015.4

29,00017.5

18,00017.4

120.83

Cautionary Statement
Forecasts of results mentioned in this document are future estimates and are thus inclusive of risks and uncertain factors since they are not based ondefinite facts. Please be awarethat a variety of factors could cause actual results to differ significantly from those projected. The major factors affecting actual results include the economic climate and social
trends surrounding the business of this Company’s group, consumer trends vis-a-vissystems and services provided by this Company’s group, as well as pressure to lower prices andability to cope with the market in response tointensified competition.Factors affecting results are not limited to the ones mentioned above.

4. Consolidated Financial Statements(1) Consolidated Balance Sheets
As ofMarch 31, 2023
AssetsCurrent assets
Cash and cash equivalents
Notes
Electronically recorded obligations
Accounts receivable
Contract assets
Purchased goods,materials and supplies
Work in processOther
Allowance for doubtful accounts
Total current assets
Non-current assets
Property and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures (net)
Machinery and vehicles
Accumulated depreciation
Machinery and vehicles (net)
Furniture and fixtures
Accumulated depreciation
Furniture and fixtures (net)Land
Construction in progress
Other
Accumulated depreciation
Other (net)Total property and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Asset for retirement benefits
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Notes and accounts payable
Electronically recorded obligations
Short-term bank loans
Current installments of long-term debt
Accrued income taxes
Accrued consumption taxes
Contract liabilities
Accrued bunuses to directors and corporate auditors
Accrued warranty on products
Accrued losses on sales contracts
Accrued compensation for damage
Accrued office transfer cost
Other current liabilities
Total current liabilities
Long-term liabilities
Long-term debt
Liabilities for retirement benefits
Other liabilities
Total long-term liabilities
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury stock, at cost
Total shareholders' equity
Accumulated other comprehensive income
Net unrealized holding gain on other securities
Deferred gains or losses on hedges
Foreign currency translation adjustments
Accumulated adjustments for retirement benefits
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets(Millions of yen)
As ofMarch 31, 2024

68,549585
1,165
88,33834,372
3,151
12,932
11,724(85)
220,735

73,507452
2,025
97,662
36,233
2,441
10,111
15,069(40)
237,464

14,888(7,897)
6,991
662
(190)
472
17,677(13,310)
4,366
1,546
695
705
(434)
271
14,343

14,269(7,532)
6,736
821
(312)
509
17,765(13,457)
4,307
1,546
330
572(404)
168
13,597

153
3,592
3,745

85
3,297
3,383

7,427
293
14,172
6,379(97)
28,17546,264
267,000

5,391
6,302
12,9625,897(102)
30,45147,433284,897

44,571
1,467
8,653
202
4,493
1,251
7,968
144
161
515
3
394
17,06386,89049,176
1,415
6,230
3,000
5,048
3,431
9,499
163
182
166
3
－
18,50996,8263,000
28,4242,970
34,395
121,285－
27,663
2,925
30,589127,416

13,122
16,708112,486(252)
142,065

13,122
16,726
120,740(244)
150,344

1,382
10
(284)
(1,930)(822)
4,471
145,714
267,000

342
3
(177)
2,043
2,211
4,925
157,481284,897

(2) Consolidated Statements of Income and Comprehensive Income(Consolidated Statements of Income)(Millions of yen)

FY Mar/2023

FY Mar/2024

Net sales

320,802359,505

Cost of sales

254,257

288,276

Gross profit

66,54571,228Selling, general and administrative expenses

43,794

46,108Operating income

22,751

25,120Interest income

1616

Dividend income of insurance

164102

Insurance income

72

106

Reversal of provision for office transfer cost－87

Other

405

343

Total non-operating income

657

655

Interest expenses

219

371

Loss on disposal of property and equipment

35190

Loss on investments in investment partnerships

65

202

Other

118

327

Total non-operating expenses

438

1,091

22,97024,684

Loss on valuation of investment securities－720

Expenses relating to move of the head office571－

Loss on liquidation of subsidiaries

147－

Loss on revision of retirement benefit plan

106－

Total extraordinary losses

825

720

Income before income taxes

22,14523,964

Income taxes - current

7,536

8,321

Income taxes - deferred
Income taxes

(272)

(78)

7,264

8,243

Net income

14,88015,721

Net income attributable to non-controlling interests

1,067

391

Net income attributable to owners of the parent

13,813

15,329Non-operating income

Non-operating expenses

Ordinary income
Extraordinary losses(Millions of yen)

FY Mar/2023
Net income

FY Mar/2024

14,88015,721

Net unrealized holding loss on other securities

140(1,040)

Deferred gains or losses on hedges

10(6)Foreign currency translation adjustments

362

197

Adjustments for retirement benefit

(716)

3,973

(1)

(1)

(204)

3,122

14,676

18,843

Owners of the parent

13,47918,363

Non-controlling interests

1,196

479

Other comprehensive income

Share of other comprehensive income of associates
accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to:(3) Consolidated Statements of Cash Flows(Millions of yen)
FY Mar/2024

FY Mar/2023
Cash flows from operating activities
Net income before income taxes
Depreciation and amortization
Amortization of goodwill
Expenses relating to move of the head office
Loss (gain) on liquidation of subsidiaries
Loss (gain) on revision of retirement benefit plan
Increase (decrease) in allowance for doubtful receivables(Increase) decrease in asset for retirement benefit
Increase (decrease) in liability for retirement benefits
Increase (decrease) in accrued bonuses to directors and corporate
auditors
Increase (decrease) in accurued warranty on products
Increase (decrease) in accurued losses on sales contracts
Increase (decrease) in accurued compensation for damage
Interest and dividend income
Interest expense(Gain) loss on valuation of investment securities(Increase) decrease in notes and accounts receivable,and contract assets(Increase) decrease in inventories
Increase (decrease) in notes and accounts payable
Increase (decrease) in accrued consumption taxes
Other, net
SubtotalInterest and dividend income received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of property and equipment
Proceeds from sale of property and equipment
Purchase of intangibles
Purchase of investment securities
Loans receivable madeCollection of loans receivable
Other, net
Net cash used in investing activities
Cash flows from financing activities
Net increase (decrease) in short-term bank loans
Repayments of long-term debt
Net (increase) decrease in treasury shares
Dividends paid to shareholders
Dividends paid to minority shareholders of subsidiaries
Other, net
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
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

22,145
4,170
235
571
147
106
47
(189)
(208)

23,964
3,727
67
－
－－
(53)
(234)
(829)

(1)

19

46
(1,756)
0(47)
219
－

21(370)
－
(43)
371
720

(10,486)(10,953)(5,309)4,187(1,192)(2,315)
10,37147(214)(7,386)
2,816

3,546
4,469
2,404
2,334
29,16143(371)(8,605)
20,228(1,309)0(1,144)(1,381)(7)
19(1,111)(4,934)(2,673)16(1,387)(474)(37)
2(295)(4,848)(1,782)(264)
22(6,990)(25)(202)(9,243)
178(11,182)
79,732
68,549(3,087)(202)
24(7,067)(25)(161)(10,520)
98
4,958
68,54973,507

(4) Segment Information
BusinessInformation

Segment

Year ended March 31, 2023(Millions of yen)
DX Solutions
Orders received
Sales(1) Sales to third parties(2) Intersegment sales
Total
Operating income (loss)

NetworkSolutions

Environmental &Social Solutions

OthersAdjustments

Total

122,651

92,107

132,653

8,630

---

356,043

114,244--114,244
13,21079,217--79,217
9,756

119,241--119,241
10,683

8,099--8,099302------(11,202)

320,802--320,802
22,751

Year ended March 31, 2024
(Millions of yen)
DX Solutions
Orders received
Sales(1) Sales to thirdparties(2) Intersegment sales
Total
Operating income (loss)

NetworkSolutions

Environmental &Social Solutions

OthersAdjustments

Total

132,818

82,108142,596

19,710---377,234

129,71083,088137,161

9,545

---

359,505--129,710
15,669--83,088
9,387--137,161
12,609--9,545249----(12,795)--359,505
25,120