Summary of Consolidated Financial Results for the Second Quarter Ending of the Fiscal Year June 30, 2023 [Based on IFRS]
February 9, 2023
Company name: ZERO CO., LTD.
Stock code:
9028
URL: http://www.zero-group.co.jp/
Representative:
President & CEO
Takeo Kitamura
Inquiries:
Director and Manager of Group Strategies Headquarters
Toshihiro Takahashi
Scheduled Date of Submission of Quarterly Report:
February 10, 2023
Scheduled date to commence dividend payments:
March 10, 2023
Preparation of supplementary material on quarterly financial results:
Yes
Holding of quarterly financial results meeting:Yes (For analysts)

Stock Exchange Listing: Tokyo
TEL 044-520-0106(Amounts less than one million yen are rounded down)
1. Consolidated financial results for the second quarter ending of the fiscal year June 30, 2023 (From July 1, 2022 to December 31, 2022)(1) Consolidated operating results (cumulative)(Percentages indicate year-on-year changes)
Sales revenue

Operating income

Profit before tax

Quarterly income

Profit attributable toequity shareholdersof the company
Millions%of yenMillions ofyen%Millions ofyen%Millionsof yen%Millions ofyen%

2Q FY2022/2023

64,247

38.4

2,174

61.8

2,172

59.4

1,465

79.3

1,457

2Q FY2021/2022

46,424

6.1

1,344

△47.9

1,363

△47.4

817

△53.8

822

Basic quarterly earnings per share
2Q FY2022/2023
2Q FY2021/2022

Total comprehensive
income of the quarter
Millionsof yen

%

77.3

1,411

59.8

△53.7

883

△53.6

Diluted quarterly earnings per share

Yen

Yen

86.54

86.53

48.92

48.86

(2) Consolidated financial position
Total assets

Equity ratio attributable toequity shareholders of thecompany

Equity attributable to equity
shareholders of the company

Total capitalMillions of yen

Millions of yen

Millions of yen%

2Q FY2022/2023

55,531

31,661

31,14256.1

FY2021/2022

54,89530,61430,06754.8

2. Cash dividends
1st quarter-end

Annual dividends per share
3rd quarter-end

2nd quarter-end
Yen

Yen

FY2021/2022

---

15.00

FY2022/2023

---

15.00

Fiscal year-end

Yen

---

FY2022/2023(forecast)

Total
Yen

Yen

22.70

37.70

25.80

40.80

(Note) Amendment from the most recently announced dividend forecast: Yes
3. Forecast of consolidated financial results for the year ending June 30, 2023 (From July 1, 2022 to June 30, 2023)

Sales revenue

Full year

Operating income(Percentages indicate year-on-year changes)
Profit attributable toequity shareholders
Basic earnings per shareof the company

Profit before tax

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

Yen

119,000

11.2

4,300

9.9

4,300

8.9

2,750

8.4

163.31(Note) Revisions from the most recently released business forecast: Yesø(Note)(1) Changes in significant subsidiary companies during the current quarter (Changes in the specific subsidiary companies following changes in the scope of
consolidation):No
New ¾ Co. (Company name),
Exclusions ¾ Co. (Company name)(2) Changes in accounting policies, changes in accounting estimates Changes in the accounting policies required by IFRS Changes in the accounting policies due to other reasons Changes in the accounting estimates(3) Number of issued shares (common shares)
 Total number of issued shares at the end of theperiod (including treasury shares)
 Number of treasury shares at the end of the period
 Average number of shares during the period(total up to this quarter)

:
:
:

No
No
No

2Q FY2022/2023

17,560,242 shares

FY2021/2022

2Q FY2022/2023

956,982 shares

FY2021/2022

2Q FY2022/2023

16,839,303 shares

2Q FY2021/2022

17,560,242 shares
994,982 shares
16,804,805 sharesøEarnings summary is not within the scope of the quarterly review by a certified public accountant or auditorøExplanation of the proper use of financial results forecast and other notes
The earnings forecast, and other forward-looking statements herein are based on the information currently available to the Company and certain assumptions that theCompany considers reasonable. The actual results may differ significantly from these forecasts due to a wide range of factors such as economic status of the majordomestic and international markets or exchange rates fluctuation.

Attached Documents – Table of Contents

1. Qualitative information on the quarterly financial results .......................................................................... ..2(1) Explanation regarding the operating results ........................................................................................ ..2(2) Explanation regarding financial position and cash flow...................................................................... ..4(3) Explanation on future forecast information, such as consolidated earnings forecast .......................... ..5
2. Summary of the quarterly consolidated financial statements and major notes .......................................... ..6(1) Summary of the quarterly consolidated financial position .................................................................. ..6(2) Summary of the quarterly consolidated profit and loss statement ....................................................... ..8(3) Summary of the quarterly consolidated comprehensive income statement ......................................... ..9(4) Summary of the quarterly consolidated statement of changes in equity ............................................. 10(5) Summary of the quarterly consolidated statement of cash flows ........................................................ 11(6) Notes regarding summary of the quarterly consolidated financial statements .................................... 13(Notes on going concern assumption) .......................................................................................................... 13(Segment information) ................................................................................................................................. 13(Business Combination) ............................................................................................................................... 14―1―

1. Qualitative information on the quarterly financial results(1) Explanation regarding the operating results
Japan's economy during the consolidated cumulative period of the second quarter continued to recovermoderately, while affected by high resource prices as the effects of supply constraints on semiconductors
and other products eased and the balance between suppressing the COVID-19 Pandemic and economic
activities progressed.
In the domestic automobile market, the total number of new vehicle sales increased to 106.6%(statistical data of the Japan Automobile Manufacturers Association) as compared to the consolidated
cumulative period of the same quarter from the previous year (hereinafter referred to as the same quarter
from the previous year), but it's still low at 88.5% compared to the year before last, due to low domestic
production. The number of registered used vehicles decreased to 95.1% compared to the same quarter
from the previous year, due to the reluctance to buy as the used vehicle market rises.
Revenues increased in all segments, mainly due to the strong performance of the used vehicle export
business to Malaysia and an increase in the number of units for vehicle transportation contracts. Operating
profit increased due to higher utilization rates resulting from increased sales in all segments, despite theimpact of higher unit prices for fuel.
As a result, the business results of our group are as follows: sales revenue of 64,247 million yen (138.4%
compared to the same quarter from the previous year) and operating profit of 2,174 million yen (161.8%
compared to the same quarter from the previous year). Also, the profit before taxes was 2,172 million yen(159.4% compared to the same quarter from the previous year), and the profit of the quarter attributable
to the equity shareholders of the company was 1,457 million yen (177.3% compared to the same quarter
from the previous year).
Number of units related to domestic distribution of automobiles
Units: vehicles
July of 2021 to December of July of 2022 to December of Compared to theDomestic
2021
2022
previous year
Number of new vehicles
sold
Domestic manufacturer *1
1,860,493
1,989,325
106.9%(out of this, Nissan*1(199,698)(220,844)(110.6%)
Motor)
Foreign manufacturer*2
123,261
125,818
102.1%
Total of new vehicle sales
1,983,754
2,115,143
106.6%
Number of registered used
vehicles
Registered vehicles*3
1,769,021
1,672,409
94.5%
Light vehicles*4
1,358,364
1,301,515
95.8%
Total number of used
3,127,385
2,973,924
95.1%
vehicles registered
July of 2021 to December of July of 2022 to December of Compared to the
Export2021
2022
previous year
New vehicles of domestic*1
1,797,260
2,080,620
115.8%
manufacturers
Used vehicles (registered*5
654,635
631,523
96.5%
vehicles)*1 Calculated from Japan Automobile Industry Association Statistics *2 Calculated from Japan Automobile Importers’
Association statistics *3 Calculated from Japan Automobile Dealers Association statistics*4 Calculated from Japan Mini Vehicles Association statistics*5 Trial calculated from the number of export deleted
registered vehicles in the Japan Automobile Dealers Association statistics
Fuel retail price
Unit: Yen / L
Compared toJuly of 2021 to December
July of 2022 to December
National average
the previousof 2021of 2022year
Light oil
*6
142.1
149.4
105.1%
Regular petrol
*6
162.2
169.3
104.4%*6 Calculated from statistics of Agency for Natural Resources and Energy (fuel used by our company fortransport is mainly light oil)―2―

The segment business results are as follows.
(1) Domestic automotive related businesses
For vehicle transportation, which is the core business, the number of units for transportation contracts
for new and used vehicles increased, which led to an increase in revenue. In addition, there was an increase
in revenue of Zero Plus IKEDA Co., Ltd., which became a consolidated subsidiary, and as a result, there
was an overall increase in revenue in the domestic automotive related business.
Segment profit was affected by increases in unit fuel prices and fuel surcharges for marine transportation
due to soaring crude oil prices and the rapid depreciation of the yen in terms of cost, but in terms of revenue,
the introduction of the fuel surcharge system in September 2022 and the effect of higher utilization rates
due to increased revenues outweighed the impact of higher fuel costs, resulting in an increase in segment
profit.
As a result, the overall sales in the domestic automotive related businesses was 27,767 million yen(112.7% compared to the same quarter from the previous year), and the segment profit was 2,217 million
yen (130.8% compared to the same quarter from the previous year).
In the vehicle transportation business, the Group continued to implement the "Digitalization","Greening", and "New normal" policies outlined in our mid-term management plan through June 30, 2024.
In the area of "Digitalization", we have set up the Transportation Digitalization Promotion Office andare promoting the construction of a system to realize systematic allocation of vehicles. We have also
launched and are promoting a new digitalization project in which crew members record the condition ofvehicles entrusted by customers using tablets.
In the area of “Greening”, we have completed the development of transportation equipment with anincreased maximum loading capacity to cope with the increased weight of automobiles as they become
more electrically powered, and we will sequentially introduce the equipment. In addition, with the rapid
adoption of EVs, a new Sales Planning Department have been established to study the establishment of an
infrastructure that includes the implementation of ancillary services in EV vehicle transportation.
In response to the "New Normal", the direction of the Ministry of Health, Labour and Welfare's revisionof the Improvement Standards Notice has been set, we will reduce indirect time other than operation hours
by promoting a system of division of labor in cargo handling while maintaining the operation hours of crew
members toward the "Year 2024 Problems", and at the same time, we will promote new hiring of crew
members and efficient operation of transportation equipment.
(2) Human resource businesses
In the pickup service business, revenue increased due to the acquisition of new contracts and an increasein MaaS (Mobility as a Service) services for J:COM (JCOM Co., Ltd.). In the human resources business,revenue increased due to an increase in the number of dispatched drivers and temp workers mainly in easternJapan, and in the airport-related business, revenue increased due to an increase in the number of dispatchedpersonnel along with the recovery in the number of flights to and from Japan. Segment profit increased due
to increased revenue in each business segment and cost reduction.
As a result, the sales revenue of the overall human resource business was 10,291 million yen (107.0%
compared to the same quarter from the previous year), and the segment profit was 366 million yen (156.2%
compared to the same quarter from the previous year).
(3) General cargo business
Revenue in the port cargo handling business increased due to increased fuel cargo handling for biomass
power plants, and the revenue in the transport / warehousing business decreased due to letting go of
unprofitable customers despite starting up a third-party logistics business by leasing new warehouses. For
segment profit, the transport / warehousing business reported a decrease due to start-up expenses for the
newly leased warehouses, but the port cargo handling business reported an increase due to increased fuelcargo handling for biomass power generation, increasing the revenue in the overall general cargo business―3―

as well.
As a result, the sales revenue of the overall general cargo business was 3,297 million yen (105.0%
compared to the same quarter from the previous year), and the segment profit was 567 million yen (113.6%
compared to the same quarter from the previous year).
(4) Overseas Related Businesses
In the used vehicle export business, sales increased significantly due to an increase in the number ofvehicles exported to Malaysia, a major export destination, as a result of an increase in local demand, partly
due to the depreciation of the yen, while previous activities to improve customer satisfaction led to anincrease in market share. In the CKD business, revenue decreased due to a decrease in packaging volume
during the model changeover. In the vehicle transportation business in China, sales increased due to therecovery of the Chinese automobile market.
Segment profit increased in the used vehicle export business and the vehicle transportation business in
China due to increased sales, and decreased in the CKD business due to decreased sales.
As a result of the above, the sales revenue of the overall overseas business was 22,891 million yen(253.8% compared to the same quarter from the previous year), and segment profit was 213 million yen(525.0% compared to the same quarter from the previous year).
Furthermore, the company expenses not included in the abovementioned report segment (expenses
affiliated with our company’s management division), etc. are allocated as an item in the "adjustment
amount" as indicated in "2. (Segment information) in the summary of the quarterly consolidated financial
statements and major notes", and totalled 1,190million yen.
(2) Explanation regarding financial position and cash flow
(1) Status of assets, liabilities, and equity(Assets)
Current assets increased by 1,147 million yen (4.7%) compared to the end of the previous consolidated
fiscal year to 25,752 million yen.
This was mainly due to an increase of 1,146 million yen in inventories.
Non-current assets decreased by 511 million yen (1.7%) compared to the end of the previous
consolidated fiscal year to 29,778 million yen.
This was mainly due to a decrease of tangible fixed assets of 535 million yen resulting from amortizationof assets of right to use, etc.
As a result, total assets increased by 635 million yen (1.2%) compared to the previous consolidated
fiscal year to 55,531 million yen.
(Liabilities)
Current liabilities decreased by 67 million yen (0.4%) compared to the end of the previous consolidated
fiscal year to 18,564 million yen.
This was mainly due to a decrease of 851 million yen in trade and other payables, despite an increaseof 351 million yen in borrowings and 418 million yen in other current liabilities.
Non-current liabilities decreased by 343 million yen (6.1%) compared to the end of the previous
consolidated fiscal year to 5,306 million yen.
This was mainly due to a decrease of 453 million yen in lease liabilities.
As a result, total liabilities decreased by 410 million yen (1.7%) compared to the end of the previous
consolidated fiscal year to 23,870 million yen.
(Equity)
Total equity increased by 1,046 million yen (3.4%) compared to the end of the previous consolidated
fiscal year to 31,661 million yen.
This was mainly because retained earnings increased by 1,020 million yen.
―4―(2) Cash flow status
Cash and cash equivalents (hereinafter referred to as "funds") at the end of the consolidated accounting
period of the second quarter increased by 43 million yen compared to the end of the previous
consolidated fiscal year to 5,224 million yen.
Each cash flow status category during the consolidated cumulative period of the second quarter andtheir causes are as follows.
(Cash flow from operating activities)
Funds obtained as a result of operating activities were 2,842 million yen (there was an income of 3,073
million yen during the same period of the previous year).
The main cause of the increase in funds were 2,418 million yen for depreciation and amortization
expenses which are non-fund expenses and 1,465 million yen in quarterly income; the main cause of
the decrease in funds was 1,146 million yen increase in inventories.
(Cash flow from investment activities)
Net cash used in investment activities was 1,051 million yen (expenditures of 588 million yen during
the same period of the previous year).
The main itemization breakdown for expenditures was 990 million yen for acquisition of tangible fixed
assets and investment property.
(Cash flow from financing activities)
Funds used as a result of financing activities was 1,673 million yen (expenditures of 1,493 million yen
during the same period of the previous year).
The main itemization breakdown for expenditures were 1,503 million yen lease liabilities payments and376 million yen for dividends, while the main itemization breakdown for income was 221 million yen
net increase for short-term borrowings.
(3) Explanation on future forecast information, such as consolidated earnings
We have revised our consolidated earnings forecast for the fiscal year ending June 2023 based on theperformance trends and other factors during the second quarter of the current fiscal year.
Please refer to the "Notice of Revision of Earnings Forecast and Year-End Dividend Forecast"announced on February 9, 2023
for details regarding the revision of the consolidated earnings forecast.

―5―

2. Summary of the consolidated financial statements and major notes(1) Summary of quarterly consolidated statement of financial position(Units: Million yen)
End of the consolidated
End of the previous
accounting period of thisconsolidated accounting year
second quarter (December 31,(June 30, 2022)
2022)
AssetsCurrent assets
Cash and cash equivalents

5,180

5,224

Trade and other receivables

15,877

15,848Inventories

2,603

3,750

Other financial assets

471

429

Other current assets

471

500

24,60525,752

Tangible fixed assets

21,19920,663

Goodwill and intangible assets

2,981

2,997

Investment properties

3,145

3,083

497

532

Other financial assets

1,646

1,755

Other non-current assets

427

395

Deferred tax assets

392

351

Total non-current assets

30,29029,778

Total assets

54,89555,531

Total current assets
Non-current assets

Investment accounting processed with equity
method―6―

(Units: Million yen)
End of the consolidated
End of the previous
accounting period of thisconsolidated accounting year
second quarter (December 31,(June 30, 2022)
2022)
Liabilities and Equity
Liabilities
Current liabilities
Trade and other payable

8,433

7,582

Loans

4,003

4,355

Lease liabilities

2,666

2,877

Income taxes payable, etc.

996

799

Other current liabilities

2,530

2,949

18,631

18,564

3,851

3,398

Other financial liabilities

82

88

Retirement benefits liabilities

899

958

Other non-current liabilities

306

312

Deferred tax liabilities

511

548

Total non-current liabilities

5,649

5,306

Total liabilities

24,281

23,870Capital

3,390

3,390

Capital surplus

3,458

3,404

Treasury stock

△667

△601

444

486

23,44024,46130,06731,142546

518

Total Equity

30,614

31,661

Total liabilities and equity

54,89555,531

Total current liabilities
Non-current liabilities
Lease liabilities

EquityOther components of funds
Retained earnings
Total equity attributable to the equity
shareholders of the company
Non-controlling interest―7―(2) Summary of quarterly consolidated profit and loss statement(Units: Million yen)

Sales revenue

Consolidated cumulative
period for the previous second
quarter(from July 1, 2021
to December 31, 2021)
46,424

Cost of sales△40,484△57,187

Gross Profit

5,939

7,059

△4,628△5,002Other income

115

157

Other expenses

△82

△39

1,344

2,174

Financial profit

38

28

Financial expenses

△19

△27

0

△3

1,363

2,172

△546

△707

817

1,465

Equity shareholders of the company

822

1,457

Non-controlling interest△4

8Profits of the quarter

817

1,465

Basic quarterly earnings per share (yen)

48.92

86.54

Diluted quarterly earnings per share (yen)

48.86

86.53

Selling, general and administrative expenses

Operating profit

Investment gain / loss through equity method
Profit before tax
Corporate income tax expenses
Profits of the quarter

Consolidated cumulative
period of this second quarter(From July 1, 2022
to December 31, 2022)
64,247

Attribution of the profits of the quarter:

Quarterly earnings per share―8―(3) Summary of the quarterly consolidated comprehensive income statement(Units: Million yen)
Consolidated cumulative
period for the previous second
quarter(from July 1, 2021
to December 31, 2021)

Consolidated cumulative
period of this second quarter(From July 1, 2022
to December 31, 2022)

817

1,465

40

△61

Financial assets measured by fair value throughother comprehensive income

△25

72

Total of the items not transferring over to profit or
loss

15

11

72

△103

△21

37

50

△65

65

△54

883

1,411

Equity shareholders of the company

862

1,439

Non-controlling interest

20

△27

Comprehensive income of the quarter

883

1,411

Profits of the quarter
Other comprehensive income
Items not transferring over to profit or loss:
Remeasurement of defined benefit system

Items which may be transferred over to profit or loss
Conversion difference of business activities
overseas
Other comprehensive income equity of affiliatedcompany accounted for by the equity method
Total of the items which may be transferred overto profit or loss

Other comprehensive income after tax deduction
Comprehensive income of the quarter

Attribution of the comprehensive income for thequarter:―9―(4) Summary of the quarterly consolidated statement of changes in equity
Consolidated cumulative period for the previous second quarter (from July 1, 2021 to December 31, 2021)(Units: Million yen)
Equity attributable to equity shareholders of the company
Other components of funds

CapitalBalance on July 1, 2021

3,390

Conversion Financial assets
Total other
Capitaldifference of measured by fair Remeasurement
Treasurycomponents ofsurplusbusinessvalue throughof defined
stock
funds
activities
other
benefit systemoverseas
comprehensive
income

3,437

△681

△31

355

-

Comprehensive income ofthe quarter

-

-

-

Share-based paymenttransactions, etc.

13

Total
Equity21,80928,28018

28,298

-

822

822

△4

817

40

25

65

20

883

25

△25

40

40

25

△25

40

40

822

862

-

△646

△646

Dividends of the surplus
Acquisition of treasury stock

Total equity
Nonattributable to the controlling
equityinterests
shareholders of
the company

324

Profits of the quarter
Other comprehensive income

Retainedearnings

△646
△0

△0

-

△0

13

-

26

26

-

-

Transfer from other capitalcomponent to Retained
earnings△40△40

Changes in scope of
consolidation
Total transactions, etc. withthe owners

-

13

13

-

-

△40

△40

Balance on December 31, 2021

3,390

3,450

△667

△5

330

-

324

40

-

-

457

457

△606

△620

457

△162

22,02428,523495

29,019Consolidated cumulative period of this second quarter (from July 1, 2022 to December 31, 2022)(Units: Million yen)
Equity attributable to equity shareholders of the company

CapitalBalance on July 1, 2022

3,390

Other components of funds
Conversion Financial assets
Total other
difference of measured by fair Remeasurement
Capitalcomponents ofTreasury businessvalue throughof definedsurplusfunds
stock
activities
other
benefit systemoverseas
comprehensive
income

3,458

△667

155

288

-

444

23,44030,067

-

1,457

△29

72

△61

△17

△29

72

△61

△17
-

Profits of the quarter
Other comprehensive income
Comprehensive income of thequarter---

Dividends of the surplus
Share-based paymenttransactions, etc.

△54

65

Balance on December 31, 2022

546

30,614

1,457

8

1,465

△17

△36

△54

1,457

1,439

△27

1,411

△376

△376

△376

11

11
-

-

Transfer from other capitalcomponent to Retained earnings
Total transactions, etc. with theownersRetainedearnings

NonTotal equity
attributable to the controlling
Total Equity
interests
equityshareholders of
the company

△0

61

60

△60

-

-

△54

65

-

△0

61

60

△436

△364

-

△364

3,390

3,404

△601

126

360

-

486

24,461

31,142518

31,661―10―

(5) Summary of the quarterly consolidated statement of cash flows(Units: Million yen)
Consolidated cumulative
period for the previous second
quarter(from July 1, 2021
to December 31, 2021)

Consolidated cumulative
period of this second quarter(From July 1, 2022
to December 31, 2022)

817

1,465

Depreciation and amortization costs

2,307

2,418

Interest income and dividend

△22

△28

Interest expense

19

21

Investment gain / loss through equity method△03Corporate income tax expenses

546

707

Increase / decrease of trade receivables (△ is anincrease)

966

△187

Increase / decrease of inventories (△ is an increase)△686△1,146

Increase / decrease of trade payables(△ is a decrease)

△86

△457

Increase / decrease in retirement benefits liabilities(△ is a decrease)

△2

△10

Other

215

867

Subtotal

4,075

3,651

22

28

△19

△21

△1,005

△816

3,073

2,842

△960

△990

2

4

△38

△64

631

-

Other

△224

△0

Cashflow from investment activities△588△1,051

Cash flow from operating activities
Profits of the quarter

Interest and dividend received
Interest paid
Corporate income tax paid
Cash flow from operating activities
Cashflow from investment activities
Payment for acquisition of tangible fixed assets andinvestment properties
Proceed from sales of tangible fixed assets andinvestment properties
Payment for intangible assets
Proceeds from acquisition of investments in
subsidiaries resulting in change in scope of
consolidation―11―

(Units: Million yen)
Consolidated cumulative
period for the previous second
quarter(from July 1, 2021
to December 31, 2021)

Consolidated cumulative
period of this second quarter(From July 1, 2022
to December 31, 2022)

Net increase or decrease of short-term loans (△ is adecrease)

700

221

Repayment of long-term loans

△17

△15

△1,529△1,503

△0

-

△646

△376

△1,493△1,673

64△74

Increase / decrease in of cash and cash equivalents (△is a decrease)

1,055

43

Cash and cash equivalents at the beginning of the year

5,904

5,180

Balance of cash and cash equivalents at the end of thequarter

6,960

5,224

Cash flow from financing activities

Repayment of lease debts
Payment for acquisitioning of treasury stock
Dividend paid
Cash flow from financing activities
Effect of exchange rate changes on cash and cash
equivalents―12―(6) Notes regarding summary of the quarterly consolidated financial statements(Notes on going concern assumption)
There are no applicable matters.
(Segment information)
The segment information of our group is as follows.
Consolidated cumulative period for the previous second quarter (from July 1, 2021 to December 31, 2021)

Sales revenue
Sales revenue fromexternal customers
Sales revenue between
segments
Total
Segment profit (operating
profit)(Units: Million yen)Totalamount on
Adjustment
the quarterly
amountconsolidated(note)
financialstatements

Domestic
automotive
relatedbusiness

Human
resourcebusiness

Generalcargobusiness

Overseas
RelatedBusiness

24,647

9,617

3,141

9,017

46,424－

46,424

36

462

59

－

559

△559

－

24,683

10,080

3,201

9,017

46,983△559

46,424

1,695

234

499

40

2,470

△1,125

1,344

Total

(Note). The △1,125 million yen adjustment amount in the segment profits includes the total company cost
△1,125 million yen and 0 million yen of transaction elimination between segments. The total company
cost is an expense related to the management divisions of our company not belonging to the reporting
segment.
Consolidated cumulative period of this second quarter (from July 1, 2022 to December 31, 2022)

Sales revenue
Sales revenue fromexternal customers
Sales revenue between
segments
Total
Segment profit (operating
profit)(Units: Million yen)Totalamount on
Adjustment
the quarterly
amountconsolidated(note)
financialstatements

Domestic
automotive
relatedbusiness

Human
resourcebusiness

Generalcargobusiness

Overseas
RelatedBusiness

27,767

10,291

3,297

22,89164,247－64,247

65

532

49

－

647

△647

－

27,833

10,824

3,346

22,89164,895△647

64,247

2,217

366

567

213

3,365

△1,190

2,174

Total

(Note). The △1,190 million yen adjustment amount in the segment profits includes the total company cost
△1,190 million yen. The total company cost is an expense related to the management divisions of ourcompany not belonging to the reporting segment.

―13―

(Business Combination)
Consolidated cumulative period for the previous second quarter (from July 1, 2021 to December 31, 2021)
On July 1, 2021, our group acquired a partial equity interest (40%) in Zero Scm Logistics (Beijing) Co.,
Ltd., a jointly controlled company accounted for by the equity method, and made it a subsidiary.
(1) Outline of the Business Combination(1) Name and business of the acquired company
Name of the acquired company: Zero Scm Logistics (Beijing) Co., Ltd.
Business description: Vehicle transportation business in China(2) Acquisition date:July 1, 2021
(3) Percentage of voting equity interest acquired:
Percentage of voting rights held immediately prior to the acquisition date: 25%
Percentage of voting rights additionally acquired on the acquisition date: 40%.
Percentage of voting rights after acquisition: 65%(4) Reasons for the business combination
Since its establishment on April 29, 2004, Zero Scm Logistics has been mainly engaged in the landtransportation of finished vehicles in China for Japanese, European and American automobile
manufacturers, including marine and rail transportation. In addition, related operations include customs
clearance, storage, and PDI (Pre-Delivery Inspection).
In China, which has become the world's largest automobile market, changes such as the evolution of
CASE, MaaS, and carbon neutrality are on the horizon, and in order to follow these changes in a timely
manner, our group aims to speed up the decision-making process by making the company a consolidated
subsidiary, and further expand its business. Specifically, as the used vehicle market is expected to be
developed in China, we will consider full-scale entry into the used vehicle transportation market. Also,
assuming that electric vehicles produced in China will be imported to Japan in the future, the Zero Groupwill consider establishing an integrated domestic and overseas transportation system (complete vehicletransportation in China → export customs clearance → marine transportation → import customs clearance→ complete vehicle transportation, PDI, installation, registration, delivery, etc. in Japan).
(5) Method of acquiring control of the acquired company:
Acquisition of equity interest in exchange for cash(2) Fair value of acquisition consideration, assets acquired and liabilities assumed as of the acquisition date
(Units: Million yen)
Fair value of acquisition consideration
Fair value on the acquisition date of the shares of the acquired company held
immediately prior to the acquisition date
Fair value of the acquired company shares additionally acquired on the acquisition
date
Fair value of assets acquired and liabilities assumed
Cash and cash equivalents
Trade and other receivables
Other current assets
Tangible fixed assets
Other non-current assets
Current liabilities
Non-current liabilities
Fair value (net amount) of assets acquired and liabilities assumed
Non-controlling interest (Note) 1
Gain on bargain purchase (Note) 2

326
521
1,153
409
161
306
7
689
41
1,306
457
1

(Note) 1. Non-controlling interest is measured as the share of non-controlling shareholders with respect to thefair value of the distinguishable net assets of the acquired company.
(Note) 2. Gain on bargain purchase is included in "Other income" in the summary of the quarterly consolidated
profit and loss statement because net assets measured at fair value exceeded consideration paid.
―14―

(3) Loss on step acquisition
As a result of remeasuring the equity interest in Zero Scm Logistics Co., Ltd., which was held by theGroup immediately prior to the date of acquisition of control, at fair value at the time of acquisition ofcontrol, a loss on step acquisition of 0 million yen was recognized and recorded in "Other expenses" in thesummary of quarterly consolidated profit and loss statement.
(4) Acquisition-related expenses
Acquisition-related expenses for this business combination was 8 million yen and is included in"Selling, general and administrative expenses" in the summary of quarterly consolidated profit and loss
statement.
(5) Cash flow from acquisition
Cash and cash equivalents used in the acquisition
Cash and cash equivalents held by the acquired company at the time of acquisition
Proceeds from acquisition of shares of subsidiaries resulting in change in scope of
consolidation(Units: Million yen)
△521
1,153
631

(6) Impact of the business combination on the Group's performance
Sales revenue and loss of the acquired company after the acquisition date recognized in the summary ofquarterly consolidated profit and loss and other comprehensive income statements for the reporting periodamounted to 1,738 million yen and 3 million yen, respectively.
Consolidated cumulative period of the second quarter (from July 1, 2022 to December 31, 2022)
There are no applicable matters.

―15―