QUARTERLY REPORT(The Second Quarter of the 74th Term)
From July 1, 2021 to September 30, 2021

(TRANSLATION)

ARISAWA MFG. CO., LTD.

TABLE OF CONTENTS
Page Number
Cover Page
PART I.

INFORMATION ON THE BUSINESS ................................................................................ 1

I. General Conditions of Business ............................................................................................................ 1
1. Changes in Principal Management Indicators, etc. ........................................................................... 1
2. Description of Business..................................................................................................................... 1
II. Status of Business ................................................................................................................................ 2
1. Business Risks, etc. ........................................................................................................................... 2
2. Analyses of Consolidated Financial Position, Business Results and Cash Flows by the
Corporate Managers ...................................................................................................................... 2
3. Agreements with Managerial Implications, etc................................................................................. 4
III. Status of the Submitting Company ..................................................................................................... 5
1. Status of Shares, etc. ......................................................................................................................... 5(1) Total Number of Shares, etc. ......................................................................................................... 5(2) Status of Stock Acquisition Rights, etc. ........................................................................................ 5(3) Status of Exercise of Moving Strike Convertible Bonds, etc. ....................................................... 5(4) Changes in the Number of Shares Issued and Outstanding, Capital Stock, etc. ............................ 5(5) Status of Major Shareholders......................................................................................................... 6(6) Status of Voting Rights.................................................................................................................. 8
2. Status of Directors and Officers ........................................................................................................ 8
IV. Status of Accounting .......................................................................................................................... 9
1. Quarterly Consolidated Financial Statements ................................................................................. 10(1) Quarterly Consolidated Balance Sheets....................................................................................... 10(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements ofComprehensive Income............................................................................................................... 12[Quarterly Consolidated Statements of Income] ......................................................................... 12[Quarterly Consolidated Statements of Comprehensive Income] ............................................... 13(3) Quarterly Consolidated Statements of Cash Flows ..................................................................... 14
2. Other................................................................................................................................................ 23
PART II. INFORMATION ON GUARANTY COMPANIES, ETC. OF THE
SUBMITTING COMPANY ................................................................................................ 24[Independent Auditors’ Quarterly Review Report]

Cover Page
Document to be filed:

Quarterly Report

Statutory basis:

Article 24-4-7, paragraph 1 of the Financial Instruments and Exchange Act

Filing to:

Director-General of the Kanto Local Finance Bureau

Date of filing:

November 12, 2021

Quarterly accounting period:

The Second Quarter of the 74th Term (From July 1, 2021 to September 30,
2021)

Company name (Japanese):

Kabushiki-Kaisha Arisawa Seisakusho

Company name (English):Arisawa Mfg. Co., Ltd.

Name and title of representative:

Yuta Arisawa, President and Representative Director

Location of head office:5-5, Minami-honcho 1-chome, Joetsu-shi, Niigata

Telephone number:(025) 524-5126

Contact person:

Shuichi Kubota, Operating Officer supervising, Accounting Department

Place of contact:5-5, Minami-honcho 1-chome, Joetsu-shi, Niigata

Telephone number:(025) 524-5126

Contact person:

Shuichi Kubota, Operating Officer supervising, Accounting Department

Places where copies of this Quarterly Report are

Arisawa Mfg. Co., Ltd., Tokyo Branch Officemade available for public inspection:(12-5, Yanagibashi 2-chome, Taito-ku, Tokyo)
Tokyo Stock Exchange, Inc.
(2-1, Nihonbashi Kabutocho, Chuo-ku, Tokyo)

PART I. INFORMATION ON THE BUSINESS
I. General Conditions of Business1. Changes in Principal Management Indicators, etc.
Term

73rd term
consolidated cumulative
second quarter

Accounting period

From April 1, 2020
to September 30, 2020

74thnd term
consolidated cumulative
second quarter
From April 1, 2021
to September 30, 2021

22,203

21,744

46,439

1,347

2,287

3,578

853

1,745

2,160

Net sales(Millions of yen)

Ordinary income(Millions of yen)
Profit attributable to ownersof the parent(Millions of yen)

73rd term
From April 1, 2020
to March 31, 2021

Comprehensive income(Millions of yen)
Net assets (Millions of yen)

1,291

1,798

3,808

49,17447,40747,444

Total assets (Millions of yen)

69,153

68,82867,257

Net income

25.67

52.38

64.94

25.63

52.34

64.84

67.2

67.6

68.8

△1,4812,867

610△1,154

1,889

1,567

△1,172△2,132△5,703

10,851

14,352

11,488per share(Yen)

Fully diluted net income per
share
(Yen)
Equity ratio(%)
Cash flows from operating
activities (Millions of yen)
Cash flows from investing
activities (Millions of yen)
Cash flows from financing
activities (Millions of yen)
Cash and cash equivalents at
the end of period(Millions of yen)

Term
Accounting period

73rd term
consolidated
second quarter
From July 1, 2020
to September 30, 2020

74th term
consolidated
second quarter
From July 1, 2021
to September 30, 2021

Net income per share
12.78
29.07
(Yen)
Note: 1. As Arisawa Mfg. Co., Ltd. (hereinafter referred to as either the “Company” or the “Submitting Company”, as the casemay be) prepares the quarterly consolidated financial statements, the changes in principal management indicators, etc. of
the Submitting Company are not stated above.
2. “Accounting Standard for Revenue Recognition” (Accounting Standards Board of Japan Statement No.29, March 31,2020), etc. have been applied from the beginning of the current consolidated fiscal first quarter. Principal Management
Indicators, etc. for the current consolidated cumulative second quarter and the current consolidated second quarter are
shown after application of the said Accounting Standards, etc.

2. Description of Business
There was no material change in information regarding the business lines of our corporate group (the Company
and its associated companies; hereinafter referred to as either the “Group” or “our Group”, as the case may be) in
the current consolidated cumulative second quarter.
No change of organization was made to any of the Company’s principal associated companies.

-1-II. Status of Business
1. Business Risks, etc.
The current consolidated cumulative second quarter saw neither any new business risks, etc. emerging nor any
significant change in the business risks, etc. stated in the Financial Report for the previous business year.

2. Analyses of Consolidated Financial Position, Business Results and Cash Flows by the Corporate
Managers
Matters stated concerning the future in the text are based on judgments made as of the end of the current
consolidated second quarter.
“Accounting Standard for Revenue Recognition” (Accounting Standards Board of Japan Statement No.29,
March 31, 2020), etc. have been applied from the current consolidated fiscal first quarter.

(1) Financial Position and Operating Results1) Operating Results
The Japanese economy in the current consolidated cumulative second quarter remained in a difficult
situation because the state of emergency was extended and economic activities were limited due to the spreadof the novel coronavirus (COVID-19). As for the outlook for the future course, there are some hopeful signs
such as an increase in vaccination coverage of anti-COVID-19 measures and lifting of the state of emergency,
but it remains uncertain because of an increasing downside risk to corporate performance such as rise in
crude oil and raw material prices.
Under such circumstances, the results of operations of our Group (the Company, its consolidated
subsidiaries and the companies accounted for under the equity method) for the current consolidated
cumulative second quarter showed, due to a decrease in sales of industrial application structural materials
and a steady increase in sales of electronic materials, net sales of 21,744 million yen (representing a 2.1%
decreased as compared with the year-earlier quarter), an operating income of 2,048 million yen (representing
a 49.0% increase as compared with the year-earlier quarter), an ordinary income of 2,287 million yen(representing a 69.7% increase as compared with the year-earlier quarter) and a profit attributable to ownersof the parent of 1,745 million yen (representing a 104.5% increase as compared with the year-earlier quarter).
Along with the application of Accounting Standard for Revenue Recognition, compared to a conventional
method, sales decreased by 1,980,305 thousand yen and operating income, ordinary income and income
before income taxes decreased by 30,773 thousand yen respectively. For details, refer to “IV. Status of
Accounting - 1. Quarterly Consolidated Financial Statements - [Notes] - (Changes in Accounting Policies)”.
Business results with respect to each segment are as follows.
Note that the method for measuring the income or loss of business segments was changed in the current
consolidated cumulative second quarter. For details, refer to “IV. Status of Accounting - 1. Quarterly
Consolidated Financial Statements - [Notes] - (Segment Information, etc.)”
a. Electronic materials segment
In the electronic materials segment, net sales were 15,342 million yen (a 2.9% increase as compared withthe year-earlier quarter) due to a steady increase in sales of materials for flexible printed circuit boards (theamount of orders received decreased by 3.5% and the production output increased by 10.3% as comparedwith the year-earlier quarter on a non-consolidated basis of the Submitting Company), while the segment
income or loss recorded an income of 1.839million yen (a 37.5% increase as compared with the year-earlier
quarter)b. Industrial application structural materials segment
In the industrial application structural materials segment, net sales were 3,368 million yen (a 22.5%
decrease as compared with the year-earlier quarter) due to a decrease in sales of materials for aircraft, while
the segment income or loss recorded an income of 362 million yen (a 24.0% decrease as compared with theyear-earlier quarter).
c. Electrical insulating materials segment
In the electrical insulating materials segment, net sales were 1,244 million yen (a 7.6% increase ascompared with the year-earlier quarter) due to an increase in sales of insulating materials for heavy electrical-2-

machinery, while the segment income or loss recorded an income of 138 million yen (a 103.7% increase ascompared with the year-earlier quarter).
d. Display materials segment
In the display materials segment, net sales were 1,571 million yen (a 17.9% increase as compared with theyear-earlier quarter) due to an increase in sales of polarization control optical components of ColorLink Japan,
Ltd, while the segment income or loss recorded an income of 366 million yen (a 612.0% increase as comparedwith the year-earlier quarter).
e. Other (other businesses)
In other businesses, net sales were 218 million yen (a 52.0% decrease as compared with the year-earlier
quarter), while the segment income was 95 million yen (a 29.0% decrease as compared with the year-earlier
quarter).
It should also be noted that the amounts of net sales, orders received, etc. stated in this section do notinclude consumption tax, etc.
2) Financial Position
Total assets as of the end of the current consolidated cumulative second quarter were 68,828 million yen,
an increase of 1,570 million yen compared with the end of the previous year. This was due largely to anincrease of 1,082 million yen in merchandise and finished goods and an increase of 1,026 million yen in raw
materials and supplies.
Total liabilities as of the end of the current consolidated cumulative second quarter were 21,420 million
yen, an increase of 167 million yen compared with the end of the previous year. This was due largely to anincrease of 661 million yen in notes and accounts payable - trade and an increase of 542 million yen inincome taxes payable.
Total net assets as of the end of the current consolidated cumulative second quarter were 47,407 million
yen, a decrease of 37 million yen compared with the end of the previous year.

(2) Status of Cash Flows
Cash and cash equivalents (hereinafter referred to as the “Funds”) as of the end of the current consolidated
second quarter amounted to 14,352 million yen, increasing 3,500 million yen, or 32.3%, as compared withthe end of the previous consolidated second quarter.
The following is the status of each cash flow category during the current consolidated cumulative second
quarter and the key factors of such status.
(Cash flows from operating activities)
Funds earned from operating activities were 2,867 million yen (a 1,481 million yen disbursed for theprevious consolidated fiscal year). This was due largely to an increase in the Funds comprising the postingsof 2,527 million yen in income before income taxes, 1,052 million yen in depreciation as well as a decreasein the Funds comprising 2,233 million yen in increase in inventories.
(Cash flows from investing activities)
Funds earned from investing activities were 1,889 million yen (a 1,154 million yen disbursed for theprevious consolidated fiscal year). This was due largely to an increase in the Funds comprising proceedsfrom withdrawal of time deposits of 1,460 million yen and proceeds from sales of investment securities of
1,455 million yen.
(Cash flows from financing activities)
Funds disbursed for financing activities were 2,132 million yen (an 81.9% increase as compared with theyear-earlier quarter). This was due largely to a decrease in the Funds comprising the payment of 1,293 million
yen in cash dividends and the expenditure of 779 million yen in payments from changes in ownershipinterests in subsidiaries that do not result in change in scope of consolidation.

(3) Management Policy, Management Strategy, etc.
There was no significant change, during the current consolidated cumulative second quarter, in the
management policy, management strategy, etc. set by our Group.

(4) Accounting Estimates and Assumptions Used in Making Such Estimates
There was no material change in a statement of the accounting estimates and assumptions used in making-3-such estimates in ”Analyses of Consolidated Financial Position, Business Results and Cash Flows by the
Corporate Managers” stated in the Financial Report for the previous business year.

(5) Business and Financial Tasks to be Preferentially Addressed
There was no material change in business and financial tasks to be preferentially addressed by our Groupin the current consolidated cumulative second quarter.

(6) Research and Development Activities
The Group’s total expenses for research and development activities incurred in the current consolidated
cumulative second quarter amounted to 922 million yen.
In this regard, there was no significant change in the status of research and development activities of ourGroup in the current consolidated cumulative second quarter.

3. Agreements with Managerial Implications, etc.
In the current consolidated second quarter, there was no decision made on, or execution of, agreements with managerial
implications, etc.

-4-

III. Status of the Submitting Company
1. Status of Shares, etc.
(1) Total Number of Shares, etc.
1) Total number of shares
Class

Total number of shares authorized to be issued

Common stock

130,000,000

Total

130,000,000

2) Shares issued and outstanding
Number of shares issued
and outstanding as of theend of the second quarter(As of September 30, 2021)

Class

Number of shares issued andoutstanding as of the filingdate of this Quarterly Report(As of November 12, 2021)

Name of financial
instruments exchange
where the shares arelisted or authorized
financial instruments
firms association where
the shares are registered

Remarks

Common stock

33,590,324

33,590,324

Tokyo Stock Exchange(First Section)

Number of sharesconstituting one
full unit: 100

Total

33,590,324

33,590,324

---

---

Note:

1.

The number of shares issued through the exercise of stock acquisition rights in the period from November 1, 2021 to
the filing date of this Quarterly Report is not included in the column “Number of shares issued and outstanding as of
the filing date of this Quarterly Report”.
2. The Company disposed of 23,435 shares of treasury stock for restricted stock compensation as of July 21, 2021 upona resolution by the Board of Directors on June 25, 2021.
3. 23,435 shares out of shares issued and outstanding as of the filing date of this Quarterly Report are by contribution
in kind (20,997 thousand yen of monetary compensation claims) when treasury stock was disposed of for restricted
stock compensation.

(2) Status of Stock Acquisition Rights, etc.
1) Details of Stock Option Scheme
No applicable matter.

2) Status of Other stock acquisition right
No applicable matter.

(3) Status of Exercise of Moving Strike Convertible Bonds, etc.
No applicable matter.

(4) Changes in the Number of Shares Issued and Outstanding, Capital Stock, etc.
PeriodAugust 31, 2021
(See Note)

Capital stock(Thousands of yen)

Number of shares issued andoutstanding

Legal capital surplus(Thousands of yen)

ChangeBalance

ChangeBalance

ChangeBalance△900,000

33,590,324－

7,629,915－

6,741,906

Note: This is due to the retirement of treasury stock.

-5-(5) Status of Major Shareholders

Full name or
corporate name

Address

As of September 30, 2021
Ratio of the numberof shares held to thenumber of shares
Number ofissued andshares held
outstanding(excluding treasury
stock) (%)

The Master Trust Bank of Japan,
Ltd. (Trust account)11-3, Hamamatsu-cho 2-chome,
Minato-ku, Tokyo

5,734,200

17.17

Custody Bank of Japan, Ltd. (Trustaccount)

8-12, Harumi 1-chome,
Chuo-ku, Tokyo

1,691,700

5.06

INTERTRUST TRUSTEES(CAYMAN) LIMITED AS
TRUSTEE OF JAPAN-UP UNIT
TRUST(Standing Proxy: Tachibana
Securities Co. Ltd.)

190 ELGIN AVENUE, GEORGE TOWN,GRAND CAYMAN, KY1-9005, CAYMANISLANDS(13-14 NihonbashiKayabacho 1-chome,
Chuo-ku, Tokyo)

1,476,900

4.42

1,472,166

4.41

Mitsubishi Gas Chemical Company, 5-2, Marunouchi 2-chome,
Inc.
Chiyoda-ku, Tokyo
INTERTRUST TRUSTEES（CAYMAN）LIMITED SOLELY IN ITS CAPACITY AS
TRUSTEE OF JAPAN-UP（Standing Proxy: Mizuho Bank
Ltd. Settlement & Clearing Services
Department）

190 ELGIN AVENUE, GEORGE TOWN,GRAND CAYMAN KY1-9005, CAYMANISLANDS(Shinagawa Intercity Tower A, 15-1, Konan 2chome, Minato-ku, Tokyo)

956,700

2.86

Arisawa Kenko Ltd.

11-44, Nishishiro-cho 3-chome,
Joetsu-shi, Niigata

834,338

2.49

The Hachijuni Bank, Ltd.
(Standing Proxy: The Master Trust
Bank of Japan, Ltd.)

178-8, Nakagosho Okada,
Nagano-shi, Nagano(11-3, Hamamatsu-cho 2-chome,
Minato-ku, Tokyo)

660,930

1.98

DFA INTL SMALL CAP VALUE
PORTFOLIO(Standing Proxy: Citibank Japan
Ltd.)

Palisades West 6300, Bee Cave Road Building
One, Austin, TX 78746 US(27-30, Shinjuku 6-chome, Shinjuku-ku, Tokyo)

631,082

1.89

The Daishi Bank, Ltd.

1071-1, Higashiborimae-dori 7-bancho,
Chuo-ku, Niigata-shi, Niigata(Standing Proxy: The Master Trust(11-3, Hamamatsu-cho 2-chome,
Bank of Japan, Ltd.)
Minato-ku, Tokyo)
The Master Trust Bank of Japan,
11-3, Hamamatsu-cho 2-chome,Ltd. (Retirement benefit trust
account and Mitsubishi Electric
Minato-ku, Tokyo
Corporation account)
Total

---

628,903

1.88

530,536

1.58

14,617,455

43.79

Note: 1. The ratio of the number of shares held to the total number of shares issued (except for treasury stock) is displayed with thenumbers truncating the numbers beyond the third decimal point. Treasury stock excluded from the total number of sharesissued and outstanding does not include 88,900 shares of the Company which a trust account for employee stock ownershipplan holds.
2. The number of shares held by Mitsubishi Gas Chemical Company, Inc. includes 966,306 shares that have been contributed
by Mitsubishi Gas Chemical Company, Inc. as the trust property of retirement benefit trust. The pertinent name in the
Company’s register of shareholders is “The Master Trust Bank of Japan, Ltd. (Retirement benefit trust account and
Mitsubishi Gas Chemical Company, Inc. account).”-6-

3. Though it is described in the Amendment Report on Bulk Holding available for public inspection as of September 6, 2018that Sumitomo Mitsui Trust Bank, Limited and a joint holder thereof hold the shares described below as of August 31, 2018,
the Company has confirmed no beneficial ownerships of the number of shares as of September 30, 2021. Therefore, such
number of shares is not included in above-mentioned Status of Major Shareholders. Details of the Amendment Report on
Bulk Holding are as follows:
Bulk Holders
Address: Sumitomo Mitsui Trust Bank, Limited and two joint holders thereof: 4-1, Marunouchi 1 chome, Chiyoda-ku, Tokyo

Number of shareholdings etc.
: 1,488,200
Holding ratio of share certificates etc. : 4.12%
4.Though it is described in the Amendment Report on Bulk Holding available for public inspection as of December 20, 2018that BlackRock Japan Co., Ltd. and a joint holder thereof hold the shares described below as of December 14, 2018, theCompany has confirmed no beneficial ownerships of the number of shares as of September 30, 2021. Therefore, such
number of shares is not included in above-mentioned Status of Major Shareholders. Details of the Report on Bulk Holding
are as follows:
Bulk Holders
Address: BlackRock Japan Co., Ltd. and one joint holder thereof: 8-3, Marunouchi 1 chome, Chiyoda-ku, Tokyo

Number of shareholdings etc.
: 1,259,700
Holding ratio of share certificates etc. : 3.48%
5. Though it is described in the Amendment Report on Bulk Holding available for public inspection as of December 21,
2018 that Sumitomo Mitsui Asset Management Company, Limited hold the shares described below as of December 14,
2018, the Company has confirmed no beneficial ownerships of the number of shares as of September 30, 2021. Therefore,such number of shares is not included in above-mentioned Status of Major Shareholders. Details of the Report on Bulk
Holding are as follows:
Bulk Holders
Address
Number of shareholdings etc.

: Sumitomo Mitsui Asset Management Company, Limited: 5-1, Atago 2 chome, Minato-ku, Tokyo: 1,090,300

Holding ratio of share certificates etc. : 3.01%
6. Though it is described in the Amendment Report on Bulk Holding available for public inspection as of October 2, 2020
that Nippon Value Investors KK hold the shares described below as of September 30, 2020, the Company has confirmed
no beneficial ownerships of the number of shares as of September 30, 2021. Therefore, such number of shares is notincluded in above-mentioned Status of Major Shareholders. Details of the Report on Bulk Holding are as follows:
Bulk Holders: Nippon Value Investors KK
Address
Number of shareholdings etc.

: 8-1 Marunouchi 1 chome, Chiyoda-ku, Tokyo: 1,421,500

Holding ratio of share certificates etc. : 3.91%
7. Though it is described in the Amendment Report on Bulk Holding available for public inspection as of June 7, 2021 that
Strategic Capital, Inc. hold the shares described below as of June 2, 2021, the Company has confirmed no beneficial
ownerships of the number of shares as of September 30, 2021. Therefore, such number of shares is not included in abovementioned Status of Major Shareholders. Details of the Report on Bulk Holding are as follows:
Bulk Holders: Strategic Capital, Inc.
Address
Number of shareholdings etc.

: 14-15, Higashi 3 chome, Shibuya-ku, Tokyo: 2,964,700

Holding ratio of share certificates etc. : 8.60%-7-(6) Status of Voting Rights
1) Shares issued and outstanding
As of September 30, 2021
Number of shares

Number of voting rights(Units)Remarks

Shares without voting rights

---

---

---

Shares with restricted voting rights(Treasury stock, etc.)

---

---

---

Shares with restricted voting rights (Other)

---

---

---

---

---

Category

Shares with full voting rights (Treasury
stock, etc.)

Common stock

Shares with full voting rights (Other)(See Note 1)

Common stock 33, 306,000

Shares constituting less than one full unit
(See Note 2)

Common stock

Number of shares issued and outstanding

212,900

333,060---

71,424------33,590,324

---

---

Total number of voting rights held by--333,060--shareholders
Note:1. 88,900 shares of the Company which a trust account for employee stock ownership plan holds (the number of voting
rights: 889 units) and 500 shares held in the name of Japan Securities Depository Center, Inc. (the number of voting
rights: 5 units) are included in the row “Shares with full voting rights (Other)”.
2. 9 shares of treasury stock are included in the row “Shares constituting less than one full unit”.

2) Treasury Stock, etc.
As of September 30, 2021
Name and address of shareholder

Number of shares held
Under thenames ofothersFull name or corporate
nameAddress

Arisawa Mfg. Co., Ltd.

5-5, Minami-honcho 1chome, Joetsu-shi,
Niigata

212,900---

212,900

0.63---

212,900---

212,900

0.63

Total

Under own
name

Ratio of the number ofshares held to thenumber of sharesissued and outstanding
(%)

Total

Note: 88,900 shares of the Company which a trust account for employee stock ownership plan holds are not included in thecolumn “Under own name”.

2. Status of Directors and Officers
No applicable matter.

-8-

IV. Status of Accounting
1.

Method of Preparation of Quarterly Consolidated Financial Statements
The quarterly consolidated financial statements of the Company are prepared in compliance with the“Regulations for Terminology, Forms and Preparation Methods of Quarterly Consolidated Financial Statements”(Cabinet Office Ordinance No. 64 of 2007).

2.

Certification of Audit
The Company received a quarterly review of its quarterly consolidated financial statements for the current
consolidated second quarter (From July 1, 2021 to September 30, 2021) and the current consolidated cumulative
second quarter (From April 1, 2021 to September 30, 2021) conducted by Ernst & Young ShinNihon LLC under
the provisions of Article 193-2, paragraph 1 of the Financial Instruments and Exchange Act.

-9-

1. Quarterly Consolidated Financial Statements(1) Quarterly Consolidated Balance Sheets(Thousands of yen)
Current consolidated
second quarter(As of September 30, 2021)

Previous consolidated
fiscal year
(As of March 31, 2021)
AssetsCurrent assets
Cash and deposits

13,215,508

13,161,073

Notes and accounts receivable-trade

16,766,218－－

17,196,140

Securities

1,242,430

2,284,767

Merchandise and finished goods

3,896,377

4,978,459

Work in process

2,175,632

2,234,270

Raw materials and supplies

3,026,247

4,052,756

Income taxes receivable

1,415,974－

Notes, accounts receivable-trade and contract assets

Other

778,645

800,839

Allowance for doubtful accounts△161,830△132,083

Total current assets

42,355,204

44,576,224

13,217,395

13,306,093

244,870

253,356

10,666,038

9,839,819

Other

788,832

868,126

Allowance for doubtful accounts△14,923△15,539

Total investments and other assets

11,439,946

10,692,406

Total non-current assets

24,902,213

24,251,856

Total assets

67,257,417

68,828,080

Non-current assets
Property, plant and equipment
Intangible assets
Investments and other assets
Investment securities- 10 -

(Thousands of yen)
Current consolidated
second quarter(As of September 30, 2021)

Previous consolidated
fiscal year
(As of March 31, 2021)
Liabilities
Current liabilities
Notes and accounts payable-trade

6,657,426

7,318,910

Current portion of bonds

36,80036,800

Short-term loans payable

3,606,087

3,905,621

Current portion of long-term loans payable

182,724

182,724

Income taxes payable

277,821819,885

Provision for bonuses

535,756

655,909

3,870

2,178

Other

2,817,772

2,642,601

Total current liabilities

14,118,258

15,564,629

54,40036,0003,761,507

4,008,647－

19,452

Net defined benefit liability

607,032

581,242

Asset retirement obligations

Provision for directors' bonuses

Non-current liabilities
Bonds payable
Long-term loans payable
Provision for share-based remuneration

89,46691,324Other

1,181,934

1,119,124Total non-current liabilities

5,694,340

5,855,791

19,812,598

21,420,421

Capital stock

7,623,638

7,629,915

Capital surplus

Total liabilities
Net assets
Shareholders’ equity

4,403,396

3,971,325

Retained earnings

33,374,092

32,938,543

Treasury stock△1,159,364△299,919

Total shareholders’ equity

44,241,763

44,239,864

Accumulated other comprehensive income
Valuation difference on available-for-sale securities

1,569,049

1,337,445

Deferred gains or losses on hedges△8,237△4,254Foreign currency translation adjustment

486,242960,189

Remeasurements of defined benefit plans△3,9593,556

2,043,095

2,296,936

Subscription rights to shares

193,962

183,373

Non-controlling interests

965,997

687,484

47,444,819

47,407,659

67,257,417

68,828,080

Total accumulated other comprehensive income

Total net assets
Total liabilities and net assets- 11 -

(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements ofComprehensive Income[Quarterly Consolidated Statements of Income][Consolidated cumulative second quarter](Thousands of yen)
Current consolidated
cumulative second quarter(From April 1, 2021
to September 30, 2021)

Previous consolidated
cumulative second quarter(From April 1, 2020
to September 30, 2020)
Net sales

22,203,695

21,744,712

Cost of sales

18,486,327

17,055,141

Gross profit

3,717,368

Selling, general and administrative expenses*

Operating income

2,342,126

4,689,570*

2,640,857

1,375,241

2,048,713

Interest income

148,698

94,145

Dividends income

50,91039,520Gain on redemption of investment securities

21,199101,189

Other

124,004

149,092

Total non-operating income

344,812383,946

Non-operating income

Non-operating expenses
Interest expenses

54,14756,448Rent expenses

44,31341,648Other273,895

47,461

Total non-operating expenses

372,355

145,558

1,347,698

2,287,101

Ordinary income
Extraordinary income
Gain on sales of non-current assets

－

1,298

Gain on sales of investment securities－

226,398

Other

26,43143,094

Total extraordinary income

26,431

270,791

Loss on retirement of non-current assets

6,793

12,246

Provision for share-based remuneration－

14,098

Other

－

4,053

Total extraordinary losses

6,793

30,398

Income before income taxes

Extraordinary losses

1,367,336

2,527,494

Income taxes

411,729

713,386

Profit955,607

1,814,108

Profit attributable to non-controlling interests

101,942

68,273

Profit853,665

1,745,834

attributable to owners of the parent- 12 -

[Quarterly Consolidated Statements of Comprehensive Income][Consolidated cumulative second quarter](Thousands of yen)
Current consolidated
cumulative second quarter(From April 1, 2021
to September 30, 2021)

Previous consolidated
cumulative second quarter(From April 1, 2020
to September 30, 2020)
Profit955,607

1,814,108

533,739△231,595

Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to owners of theparentComprehensive income attributable to non-controllinginterests- 13 -

3,287

3,982

△237,964

191,193

36,471

7,515

568

13,210336,103△15,693

1,291,711

1,798,415

1,297,997

1,999,675△6,286△201,260

(3) Quarterly Consolidated Statements of Cash Flows(Thousands of yen)
Current consolidated
cumulative second quarter(From April 1, 2021
to September 30, 2021)

Previous consolidated
cumulative second quarter(From April 1, 2020
to September 30, 2020)
Cash flows from operating activities
Income before income taxes

1,367,336

2,527,494

Depreciation

1,001,911

1,052,170

32,39325,092△26,431△43,094

13,859△21,682△43,022

120,153

Share-based compensation expenses
Gain on reversal of subscription rights to shares
Increase ( decrease) in allowance for doubtful accounts
Increase ( decrease) in provision for bonuses
Increase ( decrease) in provision for product warranties

△1

△39

Increase ( decrease) in provision for directors' bonuses
Increase ( decrease) in provision for share-based
remuneration
Increase ( decrease) in net defined benefit liability△2,543△1,692－

19,452

34,592△14,975

Loss ( gain) on redemption of investment securities

24,209△99,764△199,608△133,665

Subsidy income－△28,226

Interest expenses

54,14756,448Foreign exchange losses ( gains)Share of ( profit) loss of entities accounted for using
equity method
Loss ( gain) on sales of short-term and long-term
investment securities
Loss ( gain) on sales of non-current assets

86,004△61,162

39,991△238－△222,344－△1,298Loss on retirement of property, plant and equipment

712

6,645

696,277

333,086△991,765△2,233,961△77,199

496,080△222,039△17,513

Decrease ( increase) in other assets△193,353

70,968

Increase ( decrease) in other liabilities

32,259△204,433

1,627,729

1,623,501

Interest and dividends income received

215,039

148,501

Interest expenses paid

△90,224△70,130－

28,226

Income taxes (paid) refund△3,233,587

1,137,813

Net cash provided by (used in) operating activities△1,481,043

2,867,912

Interest and dividends income

Decrease ( increase) in notes and accounts receivabletrade
Decrease ( increase) in inventories
Increase ( decrease) in notes and accounts payabletrade
Increase ( decrease) in accrued consumption taxes

Subtotal

Proceeds from subsidy income- 14 -

(Thousands of yen)
Current consolidated
cumulative second quarter(From April 1, 2021
to September 30, 2021)

Previous consolidated
cumulative second quarter(From April 1, 2020
to September 30, 2020)
Cash flows from investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of securities
Proceeds from sales of securities
Purchase of property, plant and equipment△478,489－

200,000

1,460,600△900,000－

900,000－△788,318△882,873－

1,298

Purchase of intangible assets△36,720△36,602

Purchase of investment securities

Proceeds from sales of property, plant and equipment△497,421△102,918

Proceeds from sales of investment securities

458,033

1,455,717

Payments of loans receivable△19,000－

Collection of loans receivable

4,510

4,510

Decrease (increase) in other investments

2,571△10,324△1,154,833

1,889,408△141,144

126,916

Proceeds from long-term loans payable

593,706

519,377

Repayments of long-term loans payable△384,452△476,362

Repayments of lease obligations△32,815△39,858

Redemption of bonds△18,400△18,400

Payments for long-term accounts payable - other△52,988△31,094

12,36010,612△173△82,836－△779,045△992,745△1,293,664

Cash dividends paid to non-controlling interests△155,966△68,154

Net cash provided by (used in) financing activities△1,172,618△2,132,510△66,199

238,997

Net increase ( decrease) in cash and cash equivalents△3,874,695

2,863,808

Cash and cash equivalents at beginning of period

14,725,985

11,488,288

Net cash provided by (used in) investing activities
Cash flows from financing activities
Net increase ( decrease) in short-term loans payable

Proceeds from issuance of common stock
Purchase of treasury stock
Payments from changes in ownership interests in
subsidiaries that do not result in change in scope of
consolidation
Cash dividends paid

Effect of exchange rate change on cash and cash equivalents

Cash and cash equivalents at end of period*- 15 -

10,851,289*

14,352,096

[Notes](Changes in Accounting Policies)<Application of Accounting Standard for Revenue Recognition, etc. >“Accounting Standard for Revenue Recognition” (Accounting Standards Board of Japan Statement No.29,
March 31, 2020; hereinafter referred to as the “Revenue Recognition Accounting Standard”), etc. have been
applied from the beginning of the current consolidated fiscal first quarter and the Company recognizes revenue atthe amount expected to be received in exchange for goods or services when control of the promised goods orservices is transferred to customers.
As a result, for transactions where the role of the Company falls under an agent of sales of products to customers,
the total amount of considerations received from customers have previously been recognized as revenue, but themethod has been changed to recognize revenue at the net amount, subtracting the amount paid to third parties
from the total amount of considerations. In addition, with regard to buy-sell transactions in which the Company
provides parts to suppliers with compensation and bears a repurchase obligation, the amount equivalent to theending inventory of the provided parts retained by suppliers are recognized as liabilities pertaining to buy-selltransactions. Furthermore, with regard to buy-sell transactions in which the Company purchases parts fromsuppliers and bears a sell-back obligation, sales and cost of goods sold have previously been recorded at the timeof sell-back to suppliers of parts, but the method has been changed to recognize only the net amount equivalent
to processing cost as revenue. Moreover, for sales to some customers, in connection with transfer of control overassets to customers over time, the method of recognizing revenue over time according to the progress ofmanufacture was adopted.
For the application of the Revenue Recognition Accounting Standard, etc., the Company complies with thetransitional treatment set forth in the proviso of paragraph 84 of the Revenue Recognition Accounting Standard.
The cumulative effects resulting from retroactive application of the new accounting policy before the beginningof the current consolidated fiscal first quarter were added to or subtracted from retained earnings at the beginningof the current consolidated fiscal first quarter and the new accounting policy has been applied from the beginningbalance; provided, however, that by applying the method set forth in paragraph 86 of the Revenue Recognition
Accounting Standard, the new accounting policy has not been retroactively applied to contracts for which almost
all revenue has been recognized in accordance with the previous treatment before the beginning of the current
consolidated fiscal first quarter. With respect to contract amendments which were made before the beginning of
the current consolidated fiscal first quarter, accounting treatment was made under the terms of contract after all
contract amendments were reflected by applying the method set forth in paragraph 86, item (1) of the Revenue
Recognition Accounting Standard and the cumulative effects were added to or subtracted from retained earnings
at the beginning of the current consolidated fiscal first quarter.
As a result, in the current consolidated cumulative second quarter, sales decreased by 1,980,305 thousand yen,cost of sales decreased by 1,949,532 thousand yen, and operating income, ordinary income and income before
income taxes decreased by 30,773 thousand yen respectively. The balance of retained earnings at the beginningof the current quarter increased by 39,939 thousand yen.
As the Revenue Recognition Accounting Standard, etc. have been applied, “notes and accounts receivable”
indicated in “current assets” in the consolidated balance sheet for the previous consolidated fiscal year is presented
in “notes receivable, accounts receivable and contract assets” from the current consolidated fiscal first quarter. In
accordance with the transitional treatment set forth in paragraph 89-2 of the Revenue Recognition AccountingStandards, reclassification has not been made by the new presentation method regarding the previous consolidated
fiscal year. In addition, in accordance with the transitional treatment set forth in paragraph 28-15 of the“Accounting Standard for Quarterly Financial Reporting” (Accounting Standards Board of Japan Statement No.
12, March 31, 2020), the information related to the breakdown of the revenue from contracts with customers forthe previous consolidated cumulative second quarter was not stated.
<Application of Accounting Standard for Fair Value Measurement, etc. >“Accounting Standard for Fair Value
Measurement” (Accounting Standards Board of Japan Statement No. 30, July 4, 2019; hereinafter referred to as- 16 -

the “Fair Value Measurement Standard”), etc. have been applied from the beginning of the current consolidated
fiscal first quarter. In accordance with the transitional treatment set forth in paragraph 19 of the Fair Value
Measurement Standard and paragraph 44-2 of the “Accounting Standard for Financial Instruments” (AccountingStandards Board of Japan Statement No. 10, July 4, 2019), the new accounting policy set forth in the Fair Value
Measurement Standard, etc. was applied prospectively. There is no impact due to this application.
(Particular accounting treatments applied in preparation of quarterly consolidated financial statements)<Calculation of tax expenses>
Tax expenses are calculated by multiplying the quarterly income before income taxes by an estimated effective
tax rate. Such effective tax rate is reasonably estimated after applying tax effect accounting to the income before
income taxes for the consolidated fiscal year including the current consolidated second quarter.
(Additional information)< Accounting estimates >There was no material change in assumptions and accounting estimates including the timing of the containmentof the new corona virus infection, etc. stated in the Financial Report for the previous business year.

- 17 -

(Notes Related to Quarterly Consolidated Statements of Income)
Major items under selling, general and administrative expenses and their respective amounts are as follows.

*(Thousands of yen)
Current consolidated
cumulative second quarter(From April 1, 2021
to September 30, 2021)

Previous consolidated
cumulative second quarter(From April 1, 2020
to September 30, 2020)
Salaries, benefits and bonuses

703,502851,979

Provision for bonuses

118,474

151,066

Provision for directors' bonuses

2,250

2,178

Retirement benefit expenses
Provision of allowance for doubtful
accounts

42,94235,803

17,942

3,835(Notes Related to Quarterly Consolidated Statements of Cash Flows)* The correlation between the balance of cash and cash equivalents at the end of the current consolidated second
quarter and the amounts shown for the corresponding items on the quarterly consolidated balance sheets is asfollows.
(Thousands of yen)
Current consolidated
cumulative second quarter(From April 1, 2021
to September 30, 2021)

Previous consolidated
cumulative second quarter(From April 1, 2020
to September 30, 2020)
Cash and deposits
Time deposits with a deposit term of
more than three months
Securities (Money management fund)Cash and cash equivalents

I

11,040,030

13,161,073△903,489△735,760

714,748

1,926,782

10,851,289

14,352,096(Notes Related to Shareholders’ Equity, etc.)
Previous consolidated cumulative second quarter (From April 1, 2020 to September 30, 2020)
Dividends paid

(Resolution)

Class ofsharesOrdinary General
Meeting of
Shareholders ofJune 25, 2020

Common stock

Total amount ofdividends(Thousands ofyen)

Dividend
per share(Yen)

997,370

30.00

Record date

Effective
date

Source ofdividends

March 31, 2020

June 26, 2020

Retained earnings

II Current consolidated cumulative second quarter (From April 1, 2021 to September 30, 2021)
1. Dividends paid
(Resolution)

Class ofsharesOrdinary General
Meeting of
Shareholders ofJune 25, 2021

Common stock

Total amount ofdividends(Thousands ofyen)

Dividend
per share(Yen)

1,300,039

39.00- 18 -

Record date

Effective
date

Source ofdividends

March 31, 2021

June 28, 2021

Retained earnings

2.

Dividends whose record date belongs to the current consolidated cumulative second quarter but
whose effective date is subsequent to the end of the current consolidated cumulative second
quarter(Resolution)

Class ofsharesBoard of Directors’Meeting of
October 28, 2021

Common stock

Total amount ofdividends(Thousands ofyen)

Dividend
per share(Yen)

Record date

Effective
date

Source ofdividends

166,887

5.00

September 30,
2021

December 2,
2021

Retained earnings

Note: “Total amount of dividends” includes dividends of 444 thousand yen on the Company’s shares which a trust account for
employee stock ownership plan holds.

3.

Significant changes in the amount of shareholders’ equity

The Company terminated 900,000 shares as of August 31, 2021 upon a resolution by the Board of Directors held on July 29,
2021. As a result, the retained earnings and the treasury stock decreased by 918,310 thousand yen respectively in the current
consolidated cumulative second quarter, and the retained earnings amounted to 32,938,543 thousand yen and the treasury stock to
299,919 thousand yen as of the end of the current consolidated second quarter.

(Segment Information, etc.)[Segment Information]
I Previous consolidated cumulative second quarter (From April 1, 2020 to September 30, 2020)
1. Information on the amount of net sales and income or loss with respect to each reportable segment(Thousands of yen)
Other
Total
(See Note)

Reportable segment
Electronicmaterials

Industrial
application
structural
materials

Electricalinsulating
materials

Displaymaterials

Subtotal

Net sales
Net sales toexternal
14,915,327
4,343,397
1,156,852
1,333,137
21,748,714
454,981
22,203,695
customers
Inter-segment
－
－
－
－
－
417,951
417,951
sales or transfers
Total
14,915,327
4,343,397
1,156,852
1,333,137
21,748,714
872,932
22,621,646
Segment income or
1,337,718
476,594
67,94551,407
1,933,666
134,753
2,068,419
loss ()Note:
The column “Other” represents business operations that do not fall under any of the reportable segments and includes
the related goods sales, the logistics-related operations and other businesses, etc.

- 19 -

2. Difference between the aggregate amount of income or loss of reportable segments and the pertinent
amount shown on the quarterly consolidated statements of income as well as the key components of suchdifference (Matters concerning difference adjustment)(Thousands of yen)
IncomeAmountTotal of reportable segments

1,933,666

Income in the category “Other”

134,753

Elimination of inter-segment transactions

49

Unallocated corporate expenses (See Note)△666,686

Adjustment of inventories△26,540

Operating income shown on the quarterly
1,375,241
consolidated statements of income
Note: Unallocated corporate expenses are mostly general and administrative expenses
that are not attributable to any of the reportable segments.

3. Information on impairment loss on non-current assets or goodwill, etc. with respect to each reportablesegment
No applicable matter.

II Current consolidated cumulative second quarter (From April 1, 2021 to September 30, 2021)
1. Information on the amount of net sales and income or loss with respect to each reportable segment(Thousands of yen)
Other
Total
(See Note)

Reportable segment

Net sales
Net sales toexternalcustomers
Inter-segment
sales ortransfers
Total

Electronicmaterials

Industrial
application
structural
materials

Electricalinsulating
materials

Displaymaterials

Subtotal

15,342,174

3,368,208

1,244,599

1,571,438

21,526,420

218,291

21,744,712

－

－

－

－

－

415,842

415,842

15,342,174
3,368,208
1,244,599
1,571,438
21,526,420
634,134
22,160,555
Segment income
1,839,473
362,226
138,434
366,016
2,706,150
95,6132,801,763
Note: The column “Other” represents business operations that do not fall under any of the reportable segments and includes therelated goods sales, the logistics-related operations and other businesses, etc.

2. Difference between the aggregate amount of income or loss of reportable segments and the pertinent
amount shown on the quarterly consolidated statements of income as well as the key components of suchdifference (Matters concerning difference adjustment)(Thousands of yen)
IncomeAmountTotal of reportable segments

2,706,150

Income in the category “Other”

95,613Elimination of inter-segment transactions

8,095

Unallocated corporate expenses (See Note)△736,930

Adjustment of inventories△24,214
Operating income shown on the quarterly
2,048,713
consolidated statements of income
Note: Unallocated corporate expenses are mostly general and administrative expenses
that are not attributable to any of the reportable segments.
- 20 -

3. Information on impairment loss on non-current assets or goodwill, etc. with respect to each reportablesegment
No applicable matter.
4. Information concerning changes, etc. in reportable segments
As stated in Changes in Accounting Policies, the Revenue Recognition Accounting Standard, etc. havebeen applied from the beginning of the current consolidated fiscal first quarter and the accounting method
for Revenue Recognition was changed. Accordingly, the method for measuring the income or loss ofbusiness segments was changed.
As a result, compared to a conventional method, sales of electronic materials decreased by 1,254,869
thousand yen, sales of industrial application structural materials decreased by 639,898 thousand yen, thesegment income or loss decreased by 37,855 thousand yen, sales of electrical insulating materials decreased
by 6,762 thousand yen, the segment income or loss increased by 7 thousand yen, sales of display materials
decreased by 78,774 thousand yen, and the segment income or loss decreased by 7,074 thousand yen.
(For Revenue Recognition)
Information on the breakdown of revenue from contracts with customers
Current consolidated cumulative second quarter (From April 1, 2021 to September 30, 2021)(Thousands of yen)
Other
Total
(See Note)

Reportable segment

Goods transferred
at a point in time
Goods transferredover time
Revenue fromcontracts withcustomers
Other revenue
Net
sales
externalcustomers

Electronicmaterials

Industrial
application
structural
materials

Electricalinsulating
materials

Displaymaterials

Subtotal

15,342,174

1,602,446

1,244,599

1,331,934

19,521,154

218,291

19,739,446－

1,765,762－

239,504

2,005,266－

2,005,266

15,342,174

3,368,208

1,244,599

1,571,438

21,526,420

218,291

21,744,712

－

－

－

－

－

－

－

15,342,174

3,368,208

1,244,599

1,571,438

21,526,420

218,291

21,744,712

toNote: The column “Other” represents business operations that do not fall under any of the reportable segments andincludes the related goods sales, the logistics-related operations and other businesses, etc.

- 21 -

(Per Share Information)
The amounts of net income per share and fully diluted net income per share with their respective bases ofcalculation are as follows.
Previous consolidated
cumulative second quarter(From April 1, 2020
to September 30, 2020)(1) Net income per share

Current consolidated
cumulative second quarter(From April 1, 2021
to September 30, 2021)

25.67 yen

52.38yen853,665

1,745,834

---

---

853,665

1,745,834

33,251,980

33,332,128

25.63yen52.34yen------

54,26125,252(Basis of calculation)
Profit attributable to owners of the parent(Thousands of yen)Amount not attributable to common
stockholders (Thousands of yen)
Profit attributable to owners of the parent
pertaining to common stock(Thousands of yen)
Average number of shares of common stockduring the period(2) Fully diluted net income per share(Basis of calculation)
Adjustment of profit attributable to ownersof the parent (Thousands of yen)
Increase in the number of shares of common
stockOutline of dilutive shares that were not includedin the calculation of fully diluted net income pershare due to a lack of dilutive effect and also
underwent a significant change after the end of
the previous consolidated fiscal year

---

---

Note: The Company’s shares which are shown as treasury share in shareholders’ equity and which a trust account for employee
stock ownership plan holds are included in the number of treasury share excluded in the calculation of the average number ofshares of common stock during the period when net income (or loss) per share is calculated (- shares for the previous
consolidated cumulative second quarter and 24,446 shares for the current consolidated cumulative second quarter).

(Significant subsequent events)(Major capital investment)
The Company passed a resolution at the Board of Directors’ Meeting held on October 28, 2021 that ThinFlex Corporation,a consolidated subsidiary in Taiwan (hereinafter referred to as “ThinFlex”) will make an investment in facility expansion
and reinforcement in a base in China.
1. Overview of capital investment
New production line will be established at TopFlex Corporation, a wholly-owned subsidiary of ThinFlex, to tap into thegrowth of flexible printed circuit boards business in Asia centering around Greater China.
First, we plan to start its operation in the second half of 2023 and then enhance the facilities gradually.
2. Amount of capital investment
The investment amount is planned to be 2,200 million yen for the fiscal year 2022 and 3,500 million yen in total together
with an amount for subsequent enhancement.
3. Future outlook
As the operation is expected to start in the second half of 2023, the impact on the business results for the fiscal year
ending on March 31, 2022 will be minimal.
- 22 -

2. Other
The Company passed a resolution as below on the current interim dividends at the Board of Directors’ Meeting held on October28, 2021.
(1) Total amount of interim dividends

166,887 thousand yen(2) Interim dividends per share

5.00 yen(3) Effective date and payment commencement date

December 2, 2021

Note:1. Payment will be made to the shareholders listed or recorded on the shareholder registry as of September 30, 2021.
2. The above total amount of the interim dividends includes dividends of 444 thousand yen on the Company’s shares
which a trust account for employee stock ownership plan holds.

- 23 -

PART II. INFORMATION ON GUARANTY COMPANIES, ETC. OF THE
SUBMITTING COMPANY
No applicable matter.

- 24 -

Independent Auditors’ Quarterly Review Report
November 12, 2021
To the Board of Directors of Arisawa Mfg. Co., Ltd.

Ernst & Young ShinNihon LLC
Niigata office

Akira Igarashi
Designated Limited Liability Partner and Engagement Partner,

Certified Public Accountant
Eishi Daikoku
Designated Limited Liability Partner and Engagement Partner,

Certified Public Accountant
Conclusion of Auditors
We have conducted, under the provisions of Article 193-2, paragraph 1 of the Financial Instruments and ExchangeAct, a quarterly review of the quarterly consolidated financial statements of Arisawa Mfg. Co., Ltd. listed in the “Statusof Accounting” for the consolidated second quarter (From July 1, 2021 to September 30, 2021) and the consolidated
cumulative second quarter (From April 1, 2021 to September 30, 2021) of the consolidated fiscal year from April 1,
2021 to March 31, 2022, consisting of the quarterly consolidated balance sheets, quarterly consolidated statements ofincome, quarterly consolidated statements of comprehensive income, quarterly consolidated statements of cash flows
and notes.
In our quarterly review, no matter has come to our attention that causes us to believe that the above quarterly
consolidated financial statements do not fairly present, in any material respect, the financial conditions of Arisawa
Mfg. Co., Ltd. and its consolidated subsidiaries as of September 30, 2021 as well as the results of their operations andthe status of their cash flows in the consolidated cumulative second quarter ended September 30, 2020 in accordancewith the standards for preparation of quarterly consolidated financial statements generally accepted in Japan.
Basis for the Conclusion of Auditors
We conducted our quarterly review in accordance with the quarterly review standards generally accepted in Japan.
Our responsibility in the quarterly review standards is stated in “The Responsibility of Auditors in the Quarterly
Review Report of the Quarterly Consolidated Financial Statements.” We are independent of the Company and its
consolidated subsidiaries and fulfill other ethical responsibilities as an auditor.in accordance with the code ofprofessional ethics in Japan. We believe that the evidence we have obtained provides a basis for our conclusion
Responsibility of Management and Corporate Auditors and Board of Corporate Auditors for the Quarterly
Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of the quarterly consolidated financial
statements in accordance with the standards for preparation of quarterly consolidated financial statements generally
accepted in Japan. This includes improvement and operation of such internal control as the management deems
necessary for the preparation and fair presentation of quarterly consolidated financial statements free from material
misstatement, whether due to fraud or error.
In preparing the quarterly consolidated financial statements, management is responsible for assessing whether it is appropriate
to prepare the quarterly consolidated financial statements based on the going concern assumption and disclosing the items regarding
the going concern assumption in accordance with the standards for preparation of quarterly consolidated financial statements
generally accepted in Japan if such items are required to be disclosed.
Responsibility of Corporate Auditors and Board of Corporate Auditors is to monitor the execution of Directors’ duties in the
improvement and operation of the financial reporting process.

The Responsibility of Auditors in the Quarterly Review Report of the Quarterly Consolidated Financial Statements.
Responsibility of auditors is to express a conclusion on the quarterly consolidated financial statements from an
independent standpoint in the quarterly review report based on our quarterly review.

Auditors make professional judgements and conduct the followings with an attitude of professional skepticism through a quarterly
review process in accordance with the quarterly review standards generally accepted in Japan.
・We principally make inquiries to the management, the persons responsible for financial and accounting matters, etc. applying
analytical procedures and conducting other quarterly review procedures. The quarterly review procedures are less exhaustive
than the procedures for annual financial statement audits conducted in accordance with the audit standards generally acceptedin Japan.
・ If we deem that there is a material uncertainty regarding events or conditions that may cast significant doubt matters on thegoing concern assumption, we conclude whether the quarterly consolidated financial statements are found to contain any
matters that would lead one to believe that those are not fairly presented in accordance with the standards for preparation ofquarterly consolidated financial statements generally accepted in Japan based on the evidence we obtain. Moreover, if amaterial uncertainty regarding the going concern assumption exists, it is required to promote awareness to the notes in thequarterly consolidated financial statements in the quarterly review report, or if the notes regarding a material uncertainty in thequarterly consolidated financial statements are inappropriate, it is required to express a qualified conclusion or a negative
conclusion to the quarterly consolidated financial statements. Conclusion by the auditors is based on the audit evidence
obtained by the day of the quarterly review report, but a company may not be able to exist as the going concern depending on
future events or conditions.
・We evaluate not only whether the presentation and notes of the quarterly consolidated financial statements are found to containany matters that would lead one to believe that those are not in accordance with the standards for preparation of quarterly
consolidated financial statements generally accepted in Japan but also whether the presentation, structure, and contents of thequarterly consolidated financial statements including related notes as well as the quarterly consolidated financial statements
are found to contain any matters that would lead one to believe that those do not fairly present underlying transactions andaccounting events.
・We obtain evidence regarding the financial information of the Company and its consolidated subsidiaries to express an opinion
about the quarterly consolidated financial statements. The auditors are responsible for instruction, supervision, and executionof quarterly review regarding the quarterly consolidated financial statements. The auditors assume responsibility for an audit
opinion all by themselves.
The auditors make reports to Corporate Auditors and Board of Corporate Auditors on that they complied with the code ofprofessional ethics on independence in Japan, matters that are reasonably believed to have an impact on the auditors’ independence,and the details of safeguards if those are implemented to remove or mitigate inhibitors.

Interest
There exists no special interest between the Company as well as its consolidated subsidiaries and this audit corporation
or its engagement partners which is required to be stated pursuant to the provisions of the Certified Public Accountants
Act.
Note:

1. All the matters stated above have been electronically copied from the matters stated in the original quarterly review report. The
original quarterly review report is separately archived by the Company (the company submitting the Quarterly Report).
2. XBRL data are not included in the subject of the quarterly review.