FY2023/11 Full-year
Supplementary Material
on Financial Results

T&S inc.
TSE Growth: 4055
January 12, 2024

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Table of Contents
FY2023/11 Full-year
Highlights

p. 3

Financial Results Overview

p. ４

Operating profit

p. 6

Business Performancep. 7

Net sales by Categoryp. 8

Net sales by Customer

p. 9

Quarterly Net sales and Operating profit

p. 10

Business Environment

p. 11

Status of Engineers

p. 12Statement of Income

p. 1３

Balance Sheets

ｐ. 1４

Topicsp. 15

FY Earnings Forecast

p. 1７

Shareholder Returns

p. 19

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2

Highlights（ FY2023/11 ）(Theme of current term)

Sustainable Growth
１

Record-high revenues continues (Compared to the previous year)
Net ｓales
Operating profit
Ordinary profit
Profit2

3,442 million yen
643 million yen
648 million yen
473 million yen

:
:
:
:

（Up by 5.7%↑ + 186 million yen）
（Up by 4.2%↑ + 25 million yen）
（Up by 3.5%↑ + 22 million yen）
（Up by 7.6%↑ + 33 million yen）

(YoY)
(ditto)(ditto)(ditto)The semiconductor category remains stable➢ Sales in the semiconductor category increased by 13.2% compared to the previous year,
maintaining robust performance while mitigating the impact of the semiconductor market
downturn.
➢ Sales in the solutions category increased by 6.4% compared to the previous year, due tostable orders for contracted development projects from major customers and orders fromother customers.
➢ Sales in the advanced technology solutions category declined by 19.3% compared to theprevious year, as a reaction to the large-scale projects recorded in the previous period.

3

FY2024 is expected to increase sales and profit growth rate
The growth rate of sales and profit for FY2024 is expected to exceed those for current year.

Net sales： 3,770 million yen （YoY Up by 9.5% ↑： + 327 million yen）

Operating profit：

706 million yen （YoY Up by 9.7% ↑： +Copyright ⓒ 202４ T&S inc. All rights reserved.

62 million yen）

3

Financial Results Overview
FY2023/11 Full-year

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4

Financial Results Overview (FY2023/11)
Record-high revenues continues (Compared to the previous year)
Net ｓales
Operating profit
Ordinary profit
ProfitNet sales（Million yen）

Up by
5.7%

4,000
3,500

: 3,442 million yen:
643 million yen:
648 million yen:
473 million yen

3,256（Up by 5.7%↑ + 186 million yen）
（Up by 4.2%↑ + 25 million yen）
（Up by 3.5%↑ + 22 million yen）
（Up by 7.6%↑ + 33 million yen）

（Million yen）

Operating profit

UP by
4.2%

800

3,442
617

3,000

(YoY)
(ditto)(ditto)(ditto)

643

600

2,500
2,000

400

1,500
1,000

200

500
0

0
FY2022/11

FY2023/11

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FY2022/11

FY2023/11

5

Operating profit (FY2023/11)

Increased Operating profit by 25 million yen(Compared to the previous year)（Million yen)

Increase

Operatingprofit rate
19.0%

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Decrease

Operating profit

Operatingprofit rate
18.7%

6

Business Performance
Net sales

Ordinary profit(Million yen)

(Million yen)

4,000

800

3,442

3,500

700

3,256

648
626

3,000

600
2,732

2,500

2,297

500
2,266

2,133

2,000

1,905

419

400
304

1,500

300

1,000

200

269
202
148

500

100

0

0
FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023

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FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023

7

Net sales by Category (FY2023/11)
Solutions’ business are performing steadily with a 6.4% increase.
(compared to the previous year)

Semiconductors’ business remain strong with an increase of 13.2%.
(compared to the previous year)

Advanced Technology Solutions’ business decreased by 19.3%, as a reaction(compared to the previous year)

to the large-scale projects recorded in the previous period.

Net sales (by category)Sales proportion (by category)(Million yen)

Solution

Advanced Technology
Solution

2,429

FY2022/11

UP by+155 6.4%

195

2,585

FY2023/11
1,500

2,000

Semi 5.7%
conductor

2,500

Semiconductor
584

FY2022/11+77
662

FY2023/11
200

400

mil yen

600

UP by
13.2%

662mil yen
19.2%

FY2023/11
3,442 mil yen

800

Advanced Technology Solution
242

FY2022/11△46
195

FY2023/11
0

100

200

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300

Down by
19.3%

Solution
2,585 mil yen
75.1%（Note） Our business segment is a single segment. Only Net sales arecalculated by category.

8

Net sales by Customer (FY2023/11)
Toshiba G, Hitachi G, Kioxia G

Major customers maintaining steady level
Sales to Others and Hitachi G increased(Up by 11.4%)(Up by 19.6%)(compared to the previous year)（compared to the previous year）

Sales proportion(by customer)

Net sales (by customer)(Million yen)Toshiba G

794

FY2022/11

Down by
15.3%

672

FY2023/11

OthersHitachi G

Kioxia G

703

FY2022/11

UP by
11.4%

783

FY2023/11

957

FY2022/11
FY2023/11

UP by
1,028 7.4%

27.8%

19.5%
FY2023/11

Hitachi G
Kioxia G

Others801

FY2022/11

958

FY2023/11

400

600

800

UP by
19.6%

Toshiba G

22.8%

29.9%

1,000

(Note) Due to the restructuring of Toshiba Group, the Net sales of the former Chubu Toshiba Engineering Co., Ltd. (currently known
as Kioxia Engineering Co., Ltd.) are aggregated under Kioxia Group starting from Q3 of the previous fiscal year. Taking this into
account, sales to Toshiba Group decreased by 0.9%.

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Quarterly Net sales and Operating profit (FY2023/11)
Full-year net sales : 3,442 million yen
Increase: +186 million yen, Up by 5.7%
(compared to the previous year)

Full-year operating profit: 643 million yen
Increase: +25 million yen, Up by 4.2%
(compared to the previous year)

4,000

Net Sales(Million yen)+186 mil yen
5.7%up800

3,256 Mil yen

Net Sales

3,000

4Q

918 Mil yen

4Q

28.2%

770 Mil yen
2,000 3Q
23.7%

3Q

2Q 834 Mil yen
25.6%

2Q

1,000

1Q
0

733 Mil yen
22.5%

3,442 Mil yen

643Mil yen

4Q

194 Mil yen
31.5%

4Q

182 Mil yen
28.3%

3Q

136 Mil yen
22.1%

3Q

144 Mil yen
22.5%

2Q

160 Mil yen
25.9%

2Q

173 Mil yen
26.9%

1Q

126 Mil yen
20.5%

1Q

143 Mil yen
22.3%

617Mil yen

26.8%

812 Mil yen
23.6%
902 Mil yen
26.2%

600

400

200

806 Mil yen
1Q

23.4%

2022/112023/11（Actual）（Actual）

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Operating profit+25 mil yen
4.2%up

922 Mil yen
Operating profit(Million yen)02022/112023/11（Actual）（Actual）(Note) Some seasonal fluctuations can be observed in the company's performancedue to the number of engineers and project delivery dates.

10Business Environment - Trend of Major Customers（Overall） Trend of Major Customers(As of January 12, 2024）

The business environment surrounding our company is expected to remain strong. The
semiconductor market, which has continued to decline, is expected to see a recovery ingrowth as production adjustments produce good effect throughout the supply chain. On
the other hand, the impact of global monetary tightening, concerns over the Chinese
economic outlook, rising prices, and geopolitical risks such as those surrounding the
Middle East region remains as our challenges.

Toshiba G

Hitachi G

Kioxia G

OthersSales in the first half of FY2023 were lower than in the same period of theprevious year, although orders were higher. The company's stock was delisted on December 20, 2023, and at the same time a new management
structure was established. A recovery in business performance isanticipated, going forward.
In the “Digital Systems & Services” segment, responsible for IT services,order status have been strong, especially for large-scale projects. In
addition, orders related to generative AI are expanding. Business expansion
is expected to continue based on digital transformation demand, andinquiries to our company are also expected to increase further.
The supply-demand balance is improving due to continued production
adjustments by flash memory manufacturers, and NAND flash memory prices
are beginning to show signs of recovery from a bottom out phase. Althoughproduction adjustments are expected to continue in line with demand trends,
there has been no significant change in our view of the medium- to longterm growth trend of the flash memory market, and a recovery is expected.
Generative AI, exemplified by ChatGPT, is gaining attention. Inquiries fromour customers are increasing mainly in area of practical use.

(Compiled from publicly available information and media reports by the respective companies)
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Status of Engineers
Securing engineer resources by maintaining BP(※1) workforce
Recruitment of new graduates will increase significantly
in FY2024/11 （22 people are expect to hired）
Changes in Number of Employees(Unit: no. of people)

Changes in the number of(Unit: no. of orders)BP orders

400
296
300

304

307

19

20

267
19

330

150

20
22

19

100

200
142
248

277

285

287

118

288

50

90

100
61

0

0
FY2020/11

FY2021/11

Engineer

FY2022/11

FY2023/11 Jan.12, 2024(※2)

New Graduates

Nov/2020

Nov/2021

Nov/2023

Staff※1 BP...Business partner. Engineers engaged in our business in the form of outsourcing etc.
※2 Our company plans to hire 22 people new graduates in FY2024.

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Nov/2022

12

Statement of Income (FY2023/11)
Statement of Income (FY2023/11)
Unit: thousand yen

FY2022/11

FY2023/11+/- amount+/- %Net sales

3,256,855

3,442,875

186,020

5.7%

Cost of sales

2,243,118

2,388,001

144,833

6.5%

Gross profit

1,013,736

1,054,874

41,137

4.1%

SG&A expense

395,823

4１1,278

15,455

3.9%

Operating profit

617,913643,595

25,681

4.2%（Operating profit rate）（19.0%）（18.7%）

Ordinary profit

626,244648,457

22,212

3.5%（Ordinary profit rate）（19.2%）（18.8%）

Profit440,238

473,829

33,590

7.6%（Profit rate）（13.5%）（13.8%）

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Balance Sheets (FY2023/11)

Balance Sheets (FY2023/11)
Unit: thousand yen

FY2022/11

FY2023/11+/- amount

2,110,767

2,452,145

341,378

Fixed assets

170,732

164,315△6,416

Total assets

2,281,500

2,616,461

334,961498,233

395,820△102,413

Fixed liabilities

49,76357,392

7,629

Total liabilities

547,996453，212△94,784

Total shareholders’ equity

1,733,503

2,163,249

429,745

Total net assets

1,733,503

2,163,249

429,745

Total liabilities & net assets

2,281,500

2,616,461

334,961

Current assets

Current liabilities

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Topics

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Topics： Transition to holding company structure
Our company has decided on the transition to a holding company
structure during 2024.
Goals
✓
✓
✓
✓
✓
✓

Schedule

Achieving agile and detailed management
Ensuring the independence of operatingcompanies
Efficient resource allocation
Achieving effective corporate governance
Creating new businesses
Achieving business expansion through M&A

✓
✓
✓
✓

Dec. 1, 2023

Jan. 12, 2024

Establishing preparation company for corporate
split on Jan. 12
Concluding absorption-type split agreement（scheduled for Jan. 30）
Obtaining approval at the shareholders’ meetingfor the split contract（Scheduled for Feb. 28）
Taking effect of the absorption-type split（scheduled for Jun. 1）

Scheduled forJun. 1, 2024

Ultimate target
structure

Holding Company(Management,
Strategy)

Holding Company(Management,
Strategy)

Business Subsidiary

Corporate HQCorporate HQ

System Development
Business HQBusiness Subsidiary

System Development
Business HQAdvanced Technology
Business HQBusiness division

Advanced Technology
Business HQ

IT Services Business HQ

IT Services Business
HQ

Establishing preparationcompany for corporate split

Business division
Business division

Business SubsidiaryBusiness Subsidiary(Announced on January 12, 2024)

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FY Earnings Forecast
FY2024/11 Full-year

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FY Earnings Forecast（theme）

Moving forward the next stage

Transition from a business HQ structure to a holding company structure is expected
on June 1,2024
Unit: million yen
Net sales

FY2023

FY2024(actual)(forecast)+/- amount

+/- %

3,４４２

3,770

327

９.５%

Operating profit

643

70６

6２

９.7%

Ordinary profit

648

707

58

9.0%

Net profit for fiscal year

473

481

7

1.5%

Company

All Business HQ are performing well. Inquiries status for development projects from existingcustomers remain strong. No major changes are expected in the cost structure, and the use of BP is
expected to continue due to supplement technical personnel resources. On the other hand, in
FY2024, the company will significantly increase the number of new graduates hired and strengthen
its education system. Including mid-career hires, as in the past, we expect to see a sequential
contribution to sales.

SystemDevelopment
Business HQ

Sales forecast are expected to remain strong, mainly due to ongoing projects from our major
customers. We expects to maintain its order structure over the long term, as an increasing percentage
of customers are shifting to system operation and maintenance contract after system development
contract. We will increase our engineering resources by hiring mid-career personnel and using BP toacquire new projects not only from our main customers.

IT Services
Business HQ

Production adjustments at semiconductor factories are downsizing towards an end, factories areoperating stably, the market is expected to recover, and the supply of engineers for operation andmaintenance services at factories is continuing. We will increase the hire of new graduates, andaggressively secure and educate appropriate personnel for the expansion in expected business area.

Advanced
Technology
Business HQ

We expect steady growth in the business centered on continued projects from existing customers
and its lateral expansion, mainly in image recognition AI projects. We plan to expand projects related
to generative AI and the latest AI processors, which started in the previous fiscal year, and expect toexpand business by utilizing more advanced technologies. We will also focus on acquiring newcustomers more aggressively than in the previous fiscal year.

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Shareholder Returns

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Shareholder Returns

Dividend ratio for FY2024/11 is targeted at 10%
Basic Policy on dividends
The Company considers it an important management task to increase corporate
value through investment in the acquisition of new technologies in fields where
future growth is expected, and believes that the return of profits to shareholders
is the key to achieving this goal.
Our basic policy for profit distribution is to continue to pay appropriate dividends
in consideration of business performance, while giving priority to securing theinternal reserves necessary to improve our corporate value.
As for FY2024/11, the Company plans to pay a dividend of ７.00 yen per share (up 0.45
yen in real terms), aiming for a dividend payout ratio of around 10%, in line with the above
policy.
The financial indicators that take into account the above measures are as follows.

Dividend per share

Dividend ratio

Return on equity（ROE）

FY2023/11(Planned)

6.55yen

10.5%

24.3%

FY2024/11(Forecast)

7.00yen

1１.0％

20.２%

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Contact

T&S inc.
Corporate Planning and IR Dept.
Email / pr@tecsvc.co.jp
URL / https://www.tecsvc.co.jp/

Information contained in this material includes those related to prospects. Such information is based on thoseavailable to us at the present moment and certain assumptions that may be considered reasonable. Therefore
we do not guarantee any realization thereof and any future business performance. Various factors such aschanges in the economic climate, industries in general, customers' needs, and legislative changes may bringabout some situations substantially different from the current forecasts. In the future, even if some new
information and some event occur, we have no obligation to carry out any update or revision concerning any
information about the future contained in this material.

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