May 27, 2020

Osaki Electric Co., Ltd.
Tokyo Stock Exchange 1st Section
Securities code: 6644

FY2019（Fiscal year ended March 31, 2020）
Summary of Consolidated Financial Results
 Consolidated sales were up by 9.7% year on year to ¥90.1 billion. Operating income
declined by 14.1% to ¥3.7 billion. Profit attributable to owners of parent decreased by
33.7% to ¥1.2 billion.
 Sales in Japan decreased, while installation of smart meters to every household is carried outby power companies, the demand for shipments of smart meters has passed its peak.
 Overseas sales increased mainly due to an increase in shipments for the communications
hubs and smart meters in the United Kingdom, in addition to the revenue contribution of
the smart meter projects in Iraq (Kurdistan Regional Government) and Cambodia.
 Profits declined mainly because of an increase in cost of sales ratio, attributable to a decreasein smart meter demand and lower pricing in Japan, and a loss on valuation of inventories ofmaterials, largely due to changes for the smart meter specifications in the U.K.
 Consolidated forecast for FY2020 is ¥80 billion (11.2% decrease year on year) in net sales,
1.5 billion yen (59.4% decrease year on year) in operating income, and 0.1 billion yen(91.6% decrease year on year) in profit attributable to owners of parent.
 The Company announced Mid-term Management Plan covering a five-year period from FY2020
to FY2024 rolling targets. In this plan, the Company sets minimum targets of an 8 billion inoperating income and 9% of ROE in FY2024.
 The Company plans to pay year-end dividend of 10 yen per share (annual dividends will be 20yen per share, and consolidated payout ratio will be 81.1%). The Dividend plan for theFY2020 is 20 yen per share per annum.

1. Consolidated Financial Results(Millions of yen)

FY2018Net sales

YoY Change
Amount%

FY201982,08990,069

7,980

+9.7%

Measurement and control equipment

80,23988,333

8,094+10.1%

Others2,152

1,905(246)(11.5)%

Adjustment

(302)

(169)

132

―

20,264

19,677(587)(2.9)%

24.7%

21.8%

―

(2.8)pt

15,965

15,986200.1%

19.4%

17.7%

―

(1.7)pt

4,299

3,691(607)(14.1)%

5.2%4.1%―(1.1)pt

3,999

3,474(524)(13.1)%

294210(83)(28.5)%

560+9.2%

OrdinaryincometProfit
o attributable to owners of parent

4,293

3,544(748)(17.4)%

1,806

1,197(609)(33.7)%Net income per share（yen）

36.95

24.47(12.48)(33.8)%

3.8%

2.5%

―(1.3)pt

Gross profit
Ratio to sales

SG & A expenses
Ratio to sales

Operating income
R
Ratio to sales
aMeasurement and control equipment
tiOthers
oAdjustment

sROEales12. Consolidated Sales by Region (Excluding intercompany sales)(Millions of yen)
YoY Change

FY2018FY2019FY2020

FY2020Full-year
Forecast

Amount%1HForecast

Full-year Forecast
YoY Change
Amount%Japan

57,73553,475(4,260)(7.4)%

23,00050,000(3,475)(6.5)%

Overseas

24,35336,593

12,240+50.3%

12,00030,000(6,593)(18.0)%

Oceania

9,522

9,422(99)(1.0)%

3,800

8,500(922)(9.8)%

Europe

4,449

9,558

5,109+114.8%

4,200

10,500

941

+9.8%

Asia

7,086

8,841

1,754

+24.8%

2,000

6,500(2,341)(26.5)%

Middle Eastand others

3,295

8,770

5,475

+166.1%

2,000

4,500

(4,270)(48.7)%

82,08990,069

7,980

+9.7%

35,00080,000(10,069)(11.2)%

Total

Averageexchange rate

Estimated impact from the
COVID-19 epidemic

Japan(1,500)(2,000)（Included in in the table aboveof Fiscal 2020 Forecasts）

Overseas(5,000)(10,000)¥110.43¥109.05/USD/USD¥109.05/USD (Exchange rate assumption)

3. Operating Income by Region(Millions of yen)

FY2018Japan
Overseas
Adjustments
Total

YoY Change

FY2019Amount%FY2020

FY2020

1HForecast

Full-yearForecast

Full-year Forecast
YoY Change
Amount%5,454

3,237(2,216)(40.6)%

100

1,500(1,737)(53.7)%(1,148)440
133,691

1,588
21(607)－－(14.1)%(600)

0(440)(100.0)%－(500)

－
1,500

(21)
(2,191)－(59.4)%(7)
4,299

Estimated impact fromthe COVID-19 epidemic

Japan

(500)

(700)

（Included in in the table aboveof Fiscal 2020 Forecasts）

Overseas(1,000)(2,000)*Referential figures based on managerial accounting

4. Measurement and Control Equipment Segment Sales (Excluding intercompany sales)(Millions of yen)

FY2018MetersJapan
Smart meters
OthersOverseas smart meters
Monitor Control
Switchgears
VCTs
Others (including adjustments)
Total

FY201945,80531,14928,942
2,207
14,655
12,156
7,097
4,772
10,37180,20352,402
27,13623,9483,188
25,266
14,282
7,847
4,767
9,010
88,310*Referential figures based on managerial accounting

2

YoY Change
Amount6,597(4,013)(4,994)981
10,611
2,126
750
(5)
(1,361)
8,107%+14.4%(12.9)%(17.3)%+44.4%+72.4%+17.5%+10.6%(0.1)%(13.1)%+10.1%

5. R&D expenditures, Depreciation, Capital expenditures(Millions of yen)

FY2018YoY Change
Amount%

FY2019FY2020
Forecast

YoY Change
Amount%R&D expenditures

3,059

3,242183+6.0%

3,200(42)(1.3)%

Depreciation

2,634

2,905

270

+10.3%

2,700(205)(7.1)%

Capital expenditures

2,208

2,341132

+6.0%

2,800

458

+19.6%

6. FY2020 Consolidated Forecast(Millions of yen)

1H
FY2019YoY Change

FY2020
Forecast

Amount%Full-year
FY2020FY2019Amount%Forecast

YoY Change

Net sales

43,58035,000(8,580)(19.7)%

90,06980,000(10,069)(11.2)%

Operating income

2,033(500)(2,533)－3,691

1,500(2,191)(59.4)%

Ordinary income

1,946(700)(2,646)

－

3,544

1,600

(1,944)(54.9)%

Profit attributable toowners of parent

845(1,200)(2,045)

－

1,197

100

(1,097)(91.6)%* Estimated impact on Forecasts for Fiscal 2020 from the COVID-19 epidemic (Included in in the table

above of Fiscal 2020 Forecasts)
1H

Full-year

Net sales(6,500)(12,000)

Operating income(1,500)(2,700)Ordinary income(1,200)(2,200)

Profit attributable toowners of parent(1,000)(1,800)Demand in the Japanese smart meter market remains at low levels and expects severe pricecompetition.
While the Company will expand solutions such as energy management systems, automatic
measurement, and smart locks for rental housings, the business environment is expected to remain
severe.
In addition, the COVID-19 impact is estimated further lower sales and profits.
In the global business, the Group originally expected a strong growth from shipments to contracting
customers, as demand in Oceania and the United Kingdom was expected to expand.
However, the Company estimates the delays in the installation process of smart meters at cities thatwere under lockdown during the COVID-19 epidemic, pushing back some sales to next fiscal year.
All in all, the Company forecasts a decrease in both sales and profits for the global business.

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7. FY2020-2024 Mid-term Management Plan
(Millions of yen)

FY2020
Forecast

FY2021
Outlook

FY2022
OutlookNet sales

80,000100,000

105,000

Operating Income

1,500

5,000

6,000

Profit attributable toowners of parent

100

3,000

3,500

ROE

0.2%

6.0%

7.0%

FY2024Mid-term Target

8,000 (minimum)

9.0% (minimum)

Forecast for Fiscal 2020 includes impact on business performance from the COVID-19 epidemic.
Outlooks for Fiscal 2021 and 2022, Mid-term Target for Fiscal 2024 do not include impact of the epidemic.

8. Shareholder Return

The Company sets basic policy to carry out the continual distribution of a steady dividend toshareholders, while providing additional performance-based dividends.

The basic policy states that the amount distributed will be based on higher of either a dividend
payout ratio of 30% or 2% of DOE (dividend on equity).

The year-end dividend outlook for the current year is 10 yen per share, and annual dividends of20 yen.

For the next fiscal year, the Company plans to pay an interim dividend of 10 yen per share and 10yen of year-end dividend, resulting in annual dividends of 20 yen, the same as the current year.
Dividend per share
InterimYear-end

AnnualTotal amount ofdividends

Consolidated
payout ratio

FY201810 yen

10 yen20 yen978 million yen

54.1%

FY201910 yen

10 yen20 yen978 million yen

81.7%

FY2020 Forecast

10 yen

10 yen20 yen980.4%

 Forward-looking statements made in this material is based on management’s estimates, assumptions and projections at

the time of publication and do not represent a commitment that they will be achieved. A number of factors could cause
actual results to differ materially from expectations.
 All amounts are in millions of yen rounded down unless otherwise stated.

Financial data (Excel/PDF) are available on our website (https://www.osaki.co.jp/en/ir/finance/financialdata.html).
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