Note: This is an excerpt translation of the “Kessan Tanshin” for the convenience of overseas stakeholders.
In cases where any differences occur between the English version and the original Japanese version, theJapanese version shall prevail. F-TECH INC. assumes no responsibility for this translation or for direct,
indirect or any other forms of damages arising from the translation.

Consolidated Financial Results
for the Six Months Ended September 30, 2022
<under Japanese GAAP>

F-TECH INC.
19, Showanuma, Shobu-cho, Kuki City, Saitama, JAPAN1. Qualitative information regarding financial results for the period under review(1) Information regarding operating results
The global economy in the six months ended September 30, 2022 (from April 1, 2022 to September 30,2022) is facing concerns about the risk of a recession as its growth is slowing due to high resource prices
caused by the situation in Ukraine, China’s zero-COVID policy lockdown, monetary tightening aimed atcontrolling inflation in European and U.S. countries, and the sharp strengthening of the U.S. dollar.
In the automotive industry, the business environment remained challenging due to the tight supplydemand balance of semiconductors, various components and materials, as well as soaring raw material
costs and transportation costs.
In this business environment, the Group launched the 14th medium-term plan in April 2020. We havebeen actively working to provide customers with new value, in line with the basic policies of “Back toBasics” and “Challenge for New,” under the global policy of “Let’s exceed our limits! We will, withoutcompromise, produce the ‘Best One’ for all our customers.” As a result, we have won new orders in theNorth American market and have also acquired a new subsidiary in India, a market which abounds with
future potential, having been able to lay the groundwork for future growth.
As a result, during the six months ended September 30, 2022, net sales increased by 36.2% year on year
to 121,260 million yen, operating loss was 1,085 million yen (an operating loss of 1,424 million yen in
the same period of the previous year), ordinary profit was 229 million yen (an ordinary loss of 1,627
million yen in the same period of the previous year), and profit attributable to owners of parent was 661
million yen (loss attributable to owners of parent of 2,340 million yen in the same period of the previousyear).
Operating results by segment are as follows.
(Japan)The production volume of major customers declined on account of semiconductor shortages and otherfactors, but net sales rose 14.9% year on year to 10,117 million yen due to increased product sales andthe full-scale start of mass production at new customers. In terms of profit and loss, operating profit was
182 million yen (an operating loss of 152 million yen in the same period of the previous year) as a resultof an increase in product sales and the effect of foreign currency translation due to the yen depreciation,
despite the impact of soaring costs of raw materials and other factors.
(North America)
Net sales rose 50.6% year on year to 78,468 million yen due to the start of mass production of newly
ordered products and the depreciation of the yen, despite a decline in the production volume of major
customers. In terms of profit and loss, operating loss was 2,205 million yen (an operating loss of 2,148
million yen in the same period of the previous year) on account of the absence of coronavirus-related
government subsidies and the effect of foreign currency translation due to the yen depreciation.
(Asia)The production volume of major customers declined on account of the lockdown in Shanghai and ashortage of semiconductors, but net sales rose 16.1% year on year to 32,674 million yen owing to theacquisition of India Steel Summit Private Limited as a subsidiary and the effect of foreign currencytranslation due to the yen depreciation. In terms of profit and loss, operating profit declined 30.4% year
on year to 710 million yen on the impact of a decline in the production volume and rising transportation
costs.
(2) Information regarding financial position
As of September 30, 2022, total assets increased by 27,463 million yen compared with the end of theprevious fiscal year to 188,395 million yen, reflecting increases in cash and deposits, as well as property,
plant and equipment, such as machinery, equipment and vehicles and construction in progress.
Liabilities increased by 20,737 million yen from the end of the previous fiscal year to 121,090 million
yen, reflecting increases in long-term loans payable.
Net assets increased by 6,726 million yen to 67,304 million yen, reflecting an increase in foreign
currency translation adjustment.

(3) Information regarding consolidated earnings forecasts and other forward-looking statements
For the fiscal year ending March 31, 2023, we have revised the earnings forecasts announced on May 12,2022, based on currently available information and projections.
For details, please see the Notice Concerning Revision of Earnings Forecasts for the Fiscal Year Ending
March 31, 2023, released today.

-2-2. Quarterly consolidated financial statements and significant notes thereto(1)Consolidated balance sheets(Millions of yen)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
Construction in progress
Other, net
Total property, plant and equipment
Intangible assets
Investments and other assets
Investment securities
OtherTotal investments and other assets
Total non-current assets
Total assets-3-

As of March 31, 2022

As of September 30, 2022

1,981
36,3278,754
7,500
11,7753,387(2)69,723

6,537
38,4098,570
8,882
13,8504,714(25)80,93918,352
36,467
15,57010,97681,366299

20,38644,38818,33814,173
97,286
308

7,412
2,130
9,542
91,208160,931

6,900
2,960
9,860
107,455
188,395

(Millions of yen)

Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term loans payable
Current portion of long-term loans payable
Income taxes payable
Provision for directors’ bonuses
OtherTotal current liabilities
Non-current liabilities
Long-term loans payable
Provision for directors’ retirement benefits
Net defined benefit liability
Negative goodwill
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets-4-

As of March 31, 2022

As of September 30, 2022

22,96636,540
10,244652
44
8,371
78,81924,50832,732
11,656280
37
12,86882,083

16,735
51
919
39
3,787
21,533
100,353

33,078
49
998
36
4,844
39,007
121,090

6,790
6,733
26,619(62)
40,081

6,790
6,733
27,102
(60)
40565

518

421

4,498
7
5,025
15,47260,578160,931286
10,4808
11,196
15,542
67,304
188,395

(2)Consolidated statements of income and comprehensive income(Millions of yen)Six months ended
September 30, 2021

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating loss
Non-operating income
Interest income
Dividend income
Share of profit of entities accounted for using equity
methodForeign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses
Share of loss of entities accounted for using equity
methodOther
Total non-operating expenses
Ordinary profit (loss)
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Gain on negative goodwill
Total extraordinary income
Extraordinary losses
Loss on sales of non-current assets
Loss on retirement of non-current assets
Total extraordinary losses
Profit (loss) before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
Profit (loss)
Profit (loss) attributable toProfit (loss) attributable to owners of parent
Loss attributable to non-controlling interests
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, net of tax
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests-5-Six months ended
September 30, 2022

89,04983,491
5,557
6,982(1,424)

121,260
114,257
7,002
8,088(1,085)

37
29

39
31-

16

90
89
247

1,758
115
1,962

378

630

24-

47
449
(1,627)

16
647
229

4
1
6

21
765
787

7
38
45(1,666)
932
(123)
808
(2,474)

6
10
17
998
951
(390)
561
437

(2,340)
(134)

661
(224)

38
1,908
(83)

(107)
294
7,140(0)

(4)

358

1,858
(616)

7,685
8,123

(990)

6,834

374

1,288

(3) Consolidated statements of cash flows(Millions of yen)Six months ended
September 30, 2021
Cash flows from operating activities
Profit (loss) before income taxes
Depreciation
Amortization of goodwill
Increase (decrease) in assets and liabilities related toretirement benefits
Increase (decrease) in provision for directors’
retirement benefits
Increase (decrease) in provision for directors’
bonusesInterest and dividend income
Interest expenses
Foreign exchange losses (gains)Share of loss (profit) of entities accounted for using
equity method
Loss (gain) on sales of property, plant and equipment
Loss on retirement of property, plant and equipment
Decrease (increase) in notes and accounts receivable- tradeDecrease (increase) in inventories
Increase (decrease) in notes and accounts payable trade
Loss (gain) on sales of investment securities
Gain on negative goodwill
Increase (decrease) in contract liabilities
Decrease (increase) in accounts receivable - other
Other, net
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from sales of investment securities
Purchase of shares of subsidiaries resulting in change
in scope of consolidation
Other, net
Net cash provided by (used in) investing activities-6-

Six months ended
September 30, 2022

(1,666)
5,221
(2)

998
5,979
(2)

7

9(9)

(1)

5(7)

(66)
378
(265)

(71)
630
(1,182)24(16)

2
38(15)
10

12,153

2,599(4,164)

1,285(5,093)(1,066)(1)(205)
55(463)5,948
88(383)(1,109)
4,543

(765)
1,403(474)1,014
10,327
106(631)(1,368)8,434(7,026)
104
(30)
(20)
4(9,476)
104
(17)
(24)
--(632)(10)(6,979)(13)(10,061)(Millions of yen)Six months ended
September 30, 2021
Cash flows from financing activities
Net increase (decrease) in short-term loans payable
Proceeds from long-term loans payable
Repayments of long-term loans payable
Purchase of treasury shares
Cash dividends paid
Dividends paid to non-controlling interests
Repayments of lease obligations
Proceeds from sales of treasury shares
Other, net
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period-7-

Six months ended
September 30, 2022

3,187
7,703
(5,550)
(0)
(162)
(958)
(262)
1
229
4,188

(8,613)
20,734(5,711)
(0)
(186)
(665)
(505)
1430
5,485

350

697

2,102
3,708
5,811

4,556
1,981
6,537

(4) Notes to quarterly consolidated financial statementsUncertainties of entity’s ability to continue as going concern
Not applicable.
Substantial changes in the amount of shareholders’ equity
Not applicable.
Changes in accounting policies(Application of Accounting Standards Codification (ASC) Topic 842, “Leases”)
The Company’s consolidated subsidiaries that adopt US GAAP have adopted ASC Topic 842, Leases
from the first quarter ended June 30, 2022. As a result, lessee’s lease transactions are, in principle, allrecorded as assets and liabilities on the balance sheet.
In accordance with the transitional measures provided in this accounting standard, the cumulative effect ofadopting this accounting standard is recognized at the beginning of the first quarter ended June 30, 2022,
which is the date of initial application of this accounting standard.
As a result, “Other” presented under property, plant and equipment, “Other” presented under current
liabilities, and “Other” presented under non-current liabilities each increased by 1,247 million yen, 259
million yen, and 988 million yen, respectively, as of September 30, 2022, compared with the amounts thatwould have been recorded under the previous accounting standard. The effect on the beginning balance ofretained earnings and profit and loss for the six months ended September 30, 2022 is immaterial.
Application of special accounting for preparing quarterly consolidated financial statements(Calculation of tax expenses)
Tax expenses in the quarterly consolidated financial statements for a portion of consolidated subsidiaries
are calculated first by reasonably estimating the effective tax rate after applying tax effect accounting
against profit before income taxes for the fiscal year including the second quarter ended September 30,
2022, and next by multiplying the quarterly profit (loss) before income taxes by such estimated effective
tax rate.
Additional information
There are no material changes to the assumptions of accounting estimates regarding the impact from thenovel coronavirus infection stated in the securities report for the previous consolidated fiscal year
(Additional information).

-8-

Segment information, etc.
Segment information
I. Six months ended September 30, 2021
1. Disclosure of net sales and profit (loss) for each reportable segment(Millions of yen)
Reportable segments
JapanNet sales
Net sales to external customers
Intersegment sales and transfers
Total
Segment profit (loss)

North America

Asia

Total

8,806
6,824

52,107663

28,134
1,270

89,0498,758

15,631

52,771

29,40597,808(152)(2,148)1,020(1,280)2. Differences between total amounts of profit (loss) for reportable segments and amounts in the
consolidated statements of income and comprehensive income and main details of these differences(matters relating to difference adjustments)(Millions of yen)
ProfitAmountReportable segments total
Elimination of intersegment transactions(1,280)(143)

Operating loss in the consolidated statements ofincome and comprehensive income(1,424)

3. Disclosure of impairment loss on non-current assets and goodwill, etc. for each reportable segment
Not applicable.

-9-II. Six months ended September 30, 2022
1. Disclosure of net sales and profit (loss) for each reportable segment(Millions of yen)
Reportable segments
JapanNet sales
Net sales to external customers
Intersegment sales and transfers
Total
Segment profit (loss)

North America

Total

Asia

10,117
7,678

78,468595

32,674890

121,260
9,164

17,79579,06433,564130,424

182(2,205)

710(1,313)

2. Differences between total amounts of profit (loss) for reportable segments and amounts in theconsolidated statements of income and comprehensive income and main details of these differences(matters relating to difference adjustments)(Millions of yen)
ProfitAmount(1,313)

Reportable segments total
Elimination of intersegment transactions

227

Operating loss in the consolidated statements ofincome and comprehensive income(1,085)

3. Disclosure of impairment loss on non-current assets and goodwill, etc. for each reportable segment(Significant gain on negative goodwill)
A gain on negative goodwill of 765 million yen was recorded in the first quarter ended June 30, 2022
as a result of acquiring shares in India Steel Summit Private Limited to make it a consolidated
subsidiary. The amount of gain on negative goodwill is tentatively calculated since the allocation ofacquisition costs has not been completed as of September 30, 2022. The amount is not allocated toreportable segments as it is recorded in extraordinary income.
Significant events after reporting period
Not applicable.

- 10 -