Fiscal 2020 (Year ended December 2020) [Japan GAAP]

February 4, 2021

Company name Future Corporation
Shares listed on: First Section of Tokyo Stock Exchange
Security code number: 4722 URL https://www.future.co.jp
Representative: Yasufumi Kanemaru, Chairman and President
Contact:
Shinichi Iwata, Head of Financial & Accounting Group TEL 03-5740-5724
Scheduled date of annual general shareholders’ meeting:March 24, 2021
Scheduled date for distribution of dividend payments:
March 25, 2021
Scheduled date for filing the securities report:
March 25, 2021
Creation of supplemental material on financial results: No
Holding of financial results briefing: Yes (For institutional investors and analysts
1. 1. Consolidated Results for Fiscal 2020 (January 1, 2020 to December 31, 2020)(1) Consolidated operating results
Net sales
Fiscal 2020
Fiscal 2019

(Amount rounded off to million yen)
(Percentage figures indicate year-on-year changes)

Operating income

Profit attributable to owners of parent

Million yen%

Million yen%

Million yen%

44,31145,389

(2.4)
12.9

5,235
6,523

(19.8)
12.0

3,795
4,557

(16.7)
11.3(Note) Comprehensive income Fiscal 2020 ¥10,477 million (172.5%) Fiscal 2019
Profit per share¥3,844 million ((27.2)%)

Return on equity

Operating income ratio

Yen

%

%

Fiscal 2020
85.49
11.1
Fiscal 2019
101.94
15.6(Reference) Share of profit (loss) of entities accounted for using equity method Fiscal 2020 (0) Million yen

11.8
14.4
Fiscal 2019 36 Million yen(2) Consolidated financial position
Total assets

Net assets per share

Net assets
Million yen

Fiscal 2020
49,823Fiscal 201939,039
Shareholders’ equity ratio Fiscal 2020 ¥ 38,175 million(3) Consolidated cash flow position

Net cash provided by (used in)operating activities

Fiscal 2020
Fiscal 2019

Shareholders’ equity ratio
%

Yen

76.6
77.6

862.89677.50Net cash provided by (used in)financing activities

Cash and cash equivalents at theend of the period

Million yen

38,22830,296
Fiscal 2019 ¥ 30,296 million

Net cash provided by (used in)investing activities

Million yen

Million yen

Million yen

4,452
5,002

(666)
(1,856)(2,708)(2,118)

2. Dividends

Annualdividends(total)Dividends per share (yen)Fiscal 2019
Fiscal 2020
Fiscal 2021 (Forecast)End of the firstquarter dividend

End of thesecond quarter
dividend

End of the third
quarter dividend

Yen

Yen

Yen

―
―
―

18.00
20.00
21.00

―
―
―

Year-end
dividend

Total

First six months(accumulated total)
Full year

16,01014,929Dividend
payout ratio(consolidated)

Ratio ofdividends to
net assets(consolidated)

Yen

Yen

Million yen

%

%

21.00
20.00
21.00

39.00
40.00
42.00

1,743
1,769

38.3
46.8
38.7

6.0
5.2

3. Projected Consolidated Results for Fiscal 2021 (January 1, 2021 to December 31, 2021)
Net sales

Million yen(Percentage figures indicate year-on-year changes)

Profit attributable to ownersof parent

Operating income

Profit per share

Million yen%

Million yen%

Million yen%

Yen

22,000

(0.6)

2,900

(10.5)

1,980

44.75

47,500

7.2

7,150

36.6

4,800

△16.3
26.5

108.50* Notes(1) Changes in significant subsidiaries during the period under review (changes in specified subsidiaries that involved changes in the scopeof consolidation): None
(2) Change in accounting policies or estimates and retrospective restatements
1) Change in accounting policies in accordance with revision of accounting standards: None
2) Change in accounting policies other than item 1) above: None
3) Change in accounting estimates: None
4) Retrospective restatements: None
(3) Number of outstanding shares (common stock)1) Total outstanding shares as of the end of the47,664,000 shares Fiscal 2019
Fiscal 2020
period (including treasury shares)
3,422,611 shares Fiscal 2019
Fiscal 2020
2) Total treasury shares as of the end of theperiod44,391,754 shares Fiscal 2019
Fiscal 2020
3) Average number of outstanding stocks
during the period under review

47,664,000 shares
2,946,587 shares
44,710,831 shares(Reference) Overview of non-consolidated results
Non-consolidated Results for Fiscal 2020 (January 1, 2020 to December 31,
2020)(1) Non-consolidated operating results
Net sales
Fiscal 2020
Fiscal 2019

(Percentage figures indicate year-on-year changes)

Operating revenue

Operating income

ProfitMillion yen%

Million yen%

Million yen%

Million yen

%

5,393
4,301

25.4
107.4

3,460
4,793

(27.8)
16.7

4,709
5,684

(17.2)
36.3

4,146
5,427

(23.6)
76.7

Profit per share
Yen

Fiscal 2020
Fiscal 2019

93.41
121.39(2) Non-consolidated financial position
Total assets

Net assets

Million yen

Fiscal 2020
Fiscal 2019
(Reference) Shareholders’ equity

Shareholders’ equity ratio
Million yen％

41,12834,11382.9
29,74825,926
87.2
Fiscal 2020 ¥ 34,113 million
Fiscal 2019 ¥ 25,926 million

Net assets per share
Yen

771.08579.78* This financial results report is outside the scope of auditing by Certified Public Accountants or Audit firms.
* Points to note about the proper use of projections, and other noteworthy events
Any forward-looking statement, including earnings forecasts, contained in this document is based on information currently held by the Company and assumptions
the Company considers as reasonable, and the Company does not promise to achieve any of them. Actual results may differ significantly from forecasts due tovarious uncertain factors.

〇 Contents
1. Overview of Operating Results and Other ........................................................................................................ 2(1) Overview of operating results for fiscal 2020 .............................................................................................. 2(2) Overview of financial position for fiscal 2020 ............................................................................................ 3(3) Overview of cash flows for fiscal 2020 ....................................................................................................... 3(4) Future outlook .............................................................................................................................................. 4(5) Dividend policy and dividends for the current and next year ...................................................................... 5
2. The Future Group.............................................................................................................................................. 6
3. Basic Approach to Selection of Accounting Standards .................................................................................... 6
4. Consolidated Financial Statements and Major Notes ....................................................................................... 7(1) Consolidated balance sheets ........................................................................................................................ 7(2) Consolidated statements of income and comprehensive income ................................................................. 9(3) Consolidated statements of changes in net assets ...................................................................................... 11(4) Consolidated statements of cash flows ...................................................................................................... 13(5) Notes to consolidated financial statements ................................................................................................ 15(Notes on premise of a going concern) ............................................................................................. 15(Segment information) ............................................................................................................... 15(Per share data) ............................................................................................................... 17(Significant subsequent events).................................................................................................. 17
5. Other ............................................................................................................................................................... 18

1. Overview of Operating

Results and Other(1) Overview of operating
results for fiscal 2020
(Overview of the fiscal year under review)
The Group’s consolidated earnings results for fiscal 2020 (from January 1, 2020 to December 31,2020) are as follows.
Net sales ¥44,311 million (down 2.4% year on year)
Operating income ¥5,235 million (down 19.8% year on year)
Profit attributable to owners of parent ¥3,795 million (down 16.7% year on year)
During the fiscal year under review, the economic environment remained highly uncertain due to the impactof the spread of novel coronavirus disease (COVID-19). In the IT Consulting & Service Business, net sales
and operating income both decreased year on year, mainly reflecting the reduction and postponement of IT
investments by some client companies, along with an increase in costs due to factors such as the delay in thedelivery of some projects. Meanwhile, in the Business Innovation Business, all companies saw significant
year-on-year growth in net sales and operating income, mainly reflecting their response to changes in customer
needs associated with the shift to new lifestyles, such as growth in demand for indoor training and online
education. As a result, the group’s consolidated net sales, operating income, and profit attributable to ownersof parent all decreased year on year.
Details of the performance of each segment are as follows.
(1) IT Consulting & Service Business
Future Architect, Inc. (including the technology division of Future Corporation) saw net sales decrease. This
resulted mainly from some customers curtailing investment and were delays in the start of projects, despitea steady stream of orders for grand designs from customers promoting workstyle reforms and for renewalof core system and so forth from various industries that are conscious of the 2025 Digital Cliff. Operating
income also decreased, mainly reflecting an increase in costs due to factors such as delays in delivery andtest fees when closing highly challenging existing projects.
Future Inspace, Inc. posted lower net sales and operating income year on year due to an increase incosts with a more proactive approach to recruitment in order to reinforce human resources, despite analmost level result in maintenance and operation projects built by Future Inspace, Inc. throughcollaboration with Future Architect, Inc.
At YDC Corporation, net sales increased year on year due to the acquisition of orders frommanufacturers with strong investment intentions as well as favorable sales of its original software, “YDCSONAR,” which integrates and analyzes quality information in the manufacturing industry. At the sametime, the YDC Corporation saw a sharp increase in operating income, mainly due to improved
profitability management with the introduction of the Company’s group system.
At Future One, Inc., net sales and operating income both decreased sharply year on year, mainly due
to a greater than expected allocation of personnel to give priority to responding to delivery delays ofcertain large projects.
At dit Co., Ltd., net sales and operating income both increased sharply year on year, reflecting strong
performance of security-related services such as vulnerability diagnostics, with order acquisitions related
to network construction for ICT environment maintenance and so forth.
As a result, net sales and operating income both declined, with net sales of the segment amounting to¥35,488 million (down 5.1% year on year), and operating income coming to ¥4,900 million (down
21.7% year on year).。
(2) Business Innovation Business

At eSPORTS Co., Ltd., net sales increased year on year as sales of training gear grew atop an increasein demand for indoor training associated with the spread of COVID-19 and the company also captured

outdoor activity demand such as solo camping by responding quickly to new lifestyles and changes
in ways to enjoy leisure time. Operating income increased sharply year on year, with a contribution
from reinforcement of private brand products in popular categories.
Tokyo Calendar Inc. posted higher net sales year on year, reflecting growth of online services such as“Tokyo Calendar Date” and favorable performance of new initiatives such as “Tokyo Curry Kitchen,” anonline cooking class offering lessons from chefs of famous restaurants, despite a sharp decrease inadvertising sales. As a result, the firm posted operating income in contrast to the operating loss recordedin the previous fiscal year.
CodeCamp, Inc. saw year-on-year increases in both net sales and operating income amid a rapid
increase in needs for individual home learning and corporate online training driven by the spread of
COVID-19.
LaiBlitz, Inc.’s net sales and operating both increased year on year. The growth was mainly
attributable to steady provision of systems for professional baseball teams, along with favorable sales ofoperation of baseball fan websites and collaboration products, and a contribution to sales from theregional revitalization business.
As a result, net sales and operating income both increased sharply, with net sales of the segment
amounting to ¥8,908 million (up 10.1% year on year), and operating income coming to ¥462 million (up1,642.6% year on year).

(Note) Segment result figures mentioned above are before adjustment for intersegmental sales and transfers。

Overview of the financial position for fiscal 2020
Assets, liabilities and net assets
The following is the analysis of financial position for the fiscal year under review.

(2)

AssetsLiabilities¥49,823 million (up 27.6% year on year)¥11,594 million (up 32.6% year on year)

Net assets¥38,228 million (up 26.2% year on year)

The following is the analysis of financial position for the fiscal year under review.
1) Assets
Current assets were ¥26,436 million on a consolidated basis at the end of the fiscal year under review, up ¥1,710 million
from the preceding year, and non-current assets amounted to ¥23,387 million, up ¥9,073 million, with total assets standing at¥49,823 million, up ¥10,784 million. The main factors included an increase in investment securities (up ¥9,652 million year
on year) due to an increase in the market price of securities held, as well as increases in securities (up ¥1,000 million) andaccounts receivable - trade (up ¥797 million). This was partially offset by decreases in work in process (down ¥335 million),and customer-related assets (down ¥208 million).
2) Liabilities
Current liabilities were ¥6,476 million at the end of the fiscal year under review, down ¥75 million from the preceding year,
and non-current liabilities were ¥5,117 million, up ¥2,927 million, which brought total liabilities to ¥11,594 million, up¥2,851 million. The main factors included increases in deferred tax liabilities (up ¥2,979 million) and other current liabilities(up ¥554 million). This was partially offset by decreases including accounts payable – trade (down ¥276 million) andprovision for loss on projects (down ¥241 million).
3) Net assets
Net assets were ¥38,228 million at the end of the fiscal year under review, up ¥7,932 million from the preceding year. The
main factors included increases in valuation difference on available-for-sale securities (up ¥6,631 million) and retained
earnings (up ¥1,918 million).
In accordance with a resolution of the 31st Annual General Meeting of Shareholders held on March 25, 2020, effective
March 26, 2020 the Company reduced its capital reserve by ¥2,495 million, its other capital surplus by ¥29 million, and its
other retained earnings by ¥53 million, and included the entire amount in capital stock. As a result, capital stock stood at¥4,000 million at the end of the fiscal year under review.
(3)

Overview of cash flows for fiscal 2020

The following is the analysis of the Group’s consolidated cash flows for the fiscal year under review.
1) Net cash provided by (used in) operating activities
Net cash from operating activities saw an inflow of ¥4,452 million (compared to an inflow of ¥5,002
million in the previous fiscal year), chiefly due to the posting of profit before income taxes of ¥5,530
million and depreciation of ¥1,102 million, despite income taxes paid amounting to ¥1,718 million.
2) Net cash provided by (used in) investing activities
Net cash from investing activities saw an outflow of ¥666 million (compared to an outflow of ¥1,856
million in the previous fiscal year), chiefly due to the posting purchase of intangible assets of ¥433 million
and purchase of property, plant and equipment of ¥121 million.
3) Net cash provided by (used in) financing activities
Net cash from financing activities saw an outflow of ¥2,708 million (compared to an outflow of ¥2,118
million in the previous fiscal year), mainly reflecting cash dividends paid of ¥1,822 million and purchaseof treasury shares of ¥758 million.
4) Cash and cash equivalents at the end of the period
Cash and cash equivalents at the end of the fiscal year under review stood at ¥16,010 million, with anincrease of ¥1,080 million resulting from operating, investing and financing activities.

(4)Future outlook
The Group’s earnings forecast for the fiscal year ending December 2021 is as follows.
Net sales ¥47,500 million (up 7.2% year on year)
Operating income ¥7,150 million (up 36.6% year on year)
Profit attributable to owners of parent ¥4,800 million (up 26.5% year on
year)
In the medium to long term, corporate needs such as DX investment are expected to continue increasing,
driving by the 2025 Digital Cliff and the need to respond to economic and social issues such as changes inwork styles, including remote working.
The Group will strive to accurately grasp the investment needs of companies promoting these management
reforms, then leverage Group synergies to provide active support in an effort to gain even further support
from customers in many and diverse industries.
Furthermore, by making effective use of intellectual property and conducting flexible strategic
investments including M&As as a Group, we will evolve our business model and achieve further growthfrom the next fiscal year onward. In addition, the Group will also invest in its business foundation with aview to the future, such as continuous personnel recruitment and training, R&D, and digitalization. In
tandem with this, the Group will strengthen its internal systems by improving internal communication within
the Group and improving the accuracy of our quality management.
Noteworthy events in each business segment are as follows.
(1) IT Consulting & Service Business
Future Architect, Inc. has seen an increase in orders for grand designs from customers promoting businessreforms and core system renewals from diverse industries conscious of the 2025 Digital Cliff. The company
will strive to steadily implement these projects while continuing to capture new orders from companies thathave investment needs.
In addition, the company will strengthen its provision of DX in the form of a “next generation banking
system,” which will contribute to solving long-standing issues for the regional financial institution sector,
and to bolster its initiatives aimed at medium- to long-term growth, such as supporting increased
sophistication of overall digital strategies. Furthermore, the company will create a structure than can leadthe next generation by continuing to acquire personnel needed for the future and investing in training, as
well as strengthening quality control and project management.
YDC Corporation will pivot to a problem solving-oriented approach by building model scenarios andstrengthening IT consulting functions to meet DX demand in the manufacturing sector. It will also realize
an expansion of its business reform consulting in the field of quality management systems that utilize AI
technology and the area of development design. In addition, the company will further leverage Groupsynergies by providing the Group’s customers with the company’s original expertise and solutions cultivatedin the manufacturing sector.
FutureOne, Inc. will strive to expand orders by strengthening channels such as the Group’s network andcollaboration with external sales partners to provide its original software package “InfiniOne,” which is oneof its strengths. At the same time, it will strive to strengthen its structure by increasing its capabilities inquality control and project management for large-scale projects.

(2) Business Innovation BusinesseSPORTS Co., Ltd. will grasp trends such as the pivot to new lifestyles and changes in how people
enjoy leisure time and strive to expand its product lineup and bolster brand recognition, while also
strengthening private brand development and market launch aiming for further growth.
Tokyo Calendar Inc. will further grow new services such as “Tokyo Calendar Kitchen” and matching
services in response to growing needs for collecting user information through online media. At the sametime, the company will expand subscription services centered on online media and promote DX tostrengthen digital sales.
CodeCamp, Inc. is seeing the spread of diverse work styles such as teleworking and side jobs, as well as
increasing needs for career building with a specialization in technology. In this environment, the company
aims to grow further by using its networks with active engineers, designers, and other lecturers to provide
training as well as support for recruiting IT personnel, and actively making investments in product building.
LaiBlitz, Inc. aims to achieve further growth by pivoting to a service provision-type business model on acommon platform and also focusing on setting up a sport cloud, including data and image management
services for sports other than baseball, promoting further utilization of IT in the sport sector.

Consolidated Summary Report of Operating Results for Fiscal 2020 (Year ended December 2020) [Japan GAAP](5)

Dividend policy and dividends for the current and next year
The Company determines its dividend by comprehensively taking into account the state of its accounting
period profit and loss, cash flows and treasury stock purchasing while placing shareholder return as its
priority management issue and securing a proper level of internal reserves for the organization to continue
growing in a sustainable manner.
The Company plans to apply a dividend payout ratio standard of at least 35% of consolidated earnings.
Under the above-mentioned policy, we plan to pay a total dividend of ¥20.00 per share as a year-end
dividend from surplus. The full fiscal year dividend comprising the year-end dividend and the previouslypaid interim dividend is expected to be ¥40.00 per share (consolidated dividend payout ratio of 46.8%).
Moreover, under the above-mentioned policy, we plan to pay an annual dividend of ¥42.00 per share(year-end dividend of ¥21.00 and interim dividend of ¥21.00) as a dividend from surplus for the next
fiscal year.

-7-Consolidated Summary Report of Operating Results for Fiscal 2020 (Year ended December 2020) [Japan GAAP]

2. The Future GroupThe Group (the Company and its related companies) has introduced a holding company structure, and consists of
19 consolidated subsidiaries and seven equity-method affiliates as of December 31, 2020.
The Company, as a holding company, establishes the Group’s growth strategy, monitors management of the Group
companies, and provides specialty service to these companies. Details of the business segments of the Group and how
major related companies in charge are positioned in the relevant segment are as follows.
(IT Consulting & Service Business)
In this business, the Group helps clients solve problems, by sharing management issues with them from amanagerial perspective, understanding the essence of the clients’ businesses and establishing information
systems for them using advanced IT.
Company nameBusiness activities
Provision of IT consulting services from an objective andindependent standpoint by using leading-edge information
Future Architect, Inc. (subsidiary)
technology
Additional development as well as maintenance and operation
Future Inspace, Inc. (subsidiary)
services for projects primarily developed by Future Architect, Inc.
Provision of IT consulting services, including a solution for
integrating and analyzing quality information, mainly to customers
YDC Corporation (subsidiary)in the manufacturing business
Development, sales and maintenance of mission-critical packaged
software for sales management, production management,
FutureOne, Inc. (subsidiary)accounting and other processes as well as provision of cloud-based
services
Development, sales and maintenance of and support for intellectual
Micro CAD Co., Ltd. (subsidiary)
property management software packages, and consigned
development of design control systems for manufacturers
Security consulting and sales of products for forensic services,
dit Co., Ltd. (subsidiary)
network operations and security
Innovation Laboratory, Inc. (subsidiary)
Provision of management consulting services to create innovation
Development and sales of and support for cloud-based logistics andLogizard Co., Ltd. (affiliate)
inventories management software (WMS)(Business Innovation Business)
In this business, the Group provides original services using IT and creates business innovations.
Company nameBusiness activitieseSPORTS Co., Ltd. (subsidiary)
Sales of sports, outdoor and fitness gear on the Internet
Publication of the magazine “Tokyo Calendar,” provision ofTokyo Calendar Inc. (subsidiary)
information using websites and smartphone applications, and services
including reservations for tables at restaurants
Online and offline educational service including operation of the
CodeCamp, Inc. (subsidiary)
online programming school “CodeCamp”
Development of sports and entertainment related software and
LaiBlitz, Inc. (subsidiary)
operation of online services
Among affiliated companies engaged in businesses that are not included in the two businesses mentioned above,
such as investing in, as well as holding and managing securities, the main companies are as follows:・Major affiliated company
Future Investment Corp. (subsidiary)
3. Basic Approach to Selection of Accounting Standards
Taking into consideration the comparability of consolidated financial statements among enterprises, the Group prepares
consolidated financial statements under Japanese GAAP. The Company intends to apply International Financial
Reporting Standards (IFRS) appropriately in consideration of circumstances inside and outside of Japan.

-8-Consolidated Summary Report of Operating Results for Fiscal 2020 (Year ended December 2020) [Japan GAAP]

4. Consolidated Financial Statements and Major Notes(1) Consolidated balance sheets(in thousands of yen)Previous consolidated
fiscal year
(December 31, 2019)

Consolidated fiscal year
under review(December 31, 2020)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable – trade
Securities
Merchandise and finished goods
Work in process
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Land
Other
Accumulated depreciation
Other, net
Total property, plant and equipment
Intangible assets
Goodwill
Software
Customer-related assets
Other
Total intangible assets
Investments and other assets

Investment securities
Lease and guarantee deposits
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets-9-

14,929,901
7,087,190–
995,544351,639
1,363,881(3,007)
24,725,149

15,110,388
7,884,666
1,000,006
1,075,525
15,775
1,352,733(3,000)26,436,095

1,710,429(965,749)
744,679855
2,888,097(2,247,982)
640,115
1,385,650

1,656,638(1,007,547)
649,091855
2,794,921(2,266,482)
528,438
1,178,384

178,023
1,673,554
624,000
5,608
2,481,186

138,378
1,591,245
416,000
5,361
2,150,985

8,779,498
1,433,233
16,680237,322(19,502)
10,447,232
14,314,070
39,039,219

18,431,595
1,436,115
18,463
250,641(78,881)
20,057,933
23,387,303
49,823,398

Consolidated Summary Report of Operating Results for Fiscal 2020 (Year ended December 2020) [Japan GAAP](in thousands of yen)

Liabilities
Current liabilities
Accounts payable – trade
Current portion of long-term loans payable
Current portion of bonds
Accounts payable – other
Income taxes payable
Provision for bonuses
Provision for quality assurance
Provision for loss on projects
Other
Total current liabilities
Non-current liabilities
Long-term loans payable
Asset retirement obligations
Deferred tax liabilities
Other
Total non-current liabilities
Total liabilities
Shareholders’ equity
Capital stock
Capital stock
Capital surplus
Retain earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets- 10 -

Previous consolidated
fiscal year
(December 31, 2019)

Consolidated fiscal year
under review(December 31, 2020)

1,305,448
11,4728,000
1,326,754
854,922238,574
65,617
254,804
2,487,069
6,552,663

1,028,501
3,320
1,306,849
764,400
257,487
61,646
13,285
3,041,342
6,476,832

3,320
406,303
1,635,440
145,237
2,190,301
8,742,965

351,613
4,615,063
151,138
5,117,815
11,594,648

1,421,815
2,525,165
23,232,499(1,493,579)
25,685,901

4,000,000
21,33325,150,606(2,235,662)
26,936,278

4,598,333
586
11,432
4,610,352

11,229,849(4,185)
13,485
11,239,149
53,32338,228,750
49,823,398

30,296,254
39,039,219

Consolidated Summary Report of Operating Results for Fiscal 2020 (Year ended December 2020) [Japan GAAP](2) Consolidated statements of income and comprehensive income(in thousands of yen)Previous consolidated
fiscal year
(from January 1, 2019
to December 31, 2019)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Directors’ compensations
Salaries and bonuses
Other salaries
Rents
Training expenses
Research and development expenses
Depreciation
Recruiting expenses
Amortization of goodwill
Other
Total selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Foreign exchange gains
Share of profit of entities accounted for using
equity method
Other
Total non-operating income
Non-operating expenses
Interest expenses
Share of loss of entities accounted for using equity
methodTotal non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of investment securities
Total extraordinary income
Extraordinary losses
Loss on realized foreign currency gains
Loss on change in equity
Loss on valuation of intangible assets
Total extraordinary losses
Profit before income taxes-9-

Consolidated fiscal year
under review(from January 1, 2019
to December 31, 2019)45,389,786
26,472,105
18,917,681

44,311,243
26,245,588
18,065,655

477,271
4,732,733
314,310
1,227,847
381,694
425,879
384,015
485,396
10,1193,954,801
12,394,070
6,523,610

523,668
5,035,431
329,016
1,250,513
487,720571,394
425,377
417,135
39,6453,750,700
12,830,603
5,235,052

1,132
142,716
4,268

791
184,834
3,651

36,619
7,741
192,478–
14,681
203,958

5,130

285

–
5,130
6,710,958

703
989
5,438,020––

93,31893,318

175,312
4,913
53,000233,226
6,477,732

–
683
–
683
5,530,655

Consolidated Summary Report of Operating Results for Fiscal 2020 (Year ended December 2020) [Japan GAAP](in thousand yen)Previous consolidated
fiscal year
(from January 1, 2019
to December 31, 2019)

Income taxes – current
Income taxes – deferred
Total income taxes
Profit(Profit attributable to)Profit attributable to owners of parent
Profit attributable to owners of non-controllinginterests
Other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Share of other comprehensive income ofentities accounted for using equity method
Total other comprehensive income
Comprehensive income(Comprehensive income attributable to)Comprehensive income attributable to owners ofparentComprehensive income attributable to noncontrolling interests- 10 -

Consolidated fiscal year
under review(from January 1, 2019
to December 31, 2019)

2,115,164(211,904)
1,903,259
4,574,472

1,632,872
49,441
1,682,313
3,848,342

4,557,641
16,831

3,795,019
53,323(839,909)
2,099
109,147

6,631,516(4,772)339(907)(729,569)
3,844,903

1,713
6,628,796
10,477,138

3,828,035

10,423,815

16,86753,323

Consolidated Summary Report of Operating Results for Fiscal 2020 (Year ended December 2020) [Japan GAAP](3) Consolidated statements of changes in net assets
Previous consolidated fiscal year (from January 1, 2019 to December 31, 2019)(in thousands of yen）

Shareholders’ equity
Capital stock
Balance at the
beginning of the period
Changes of items
during the period
Dividends fromsurplusProfit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
sharesNet changes of items
other thanshareholders’ equity
Total changes of items
during the period
Balance at the end of
the period

Balance at the
beginning of theperiodChanges of items
during the period
Dividends fromsurplusProfit attributableto owners ofparentPurchase oftreasury shares
Disposal oftreasury shares
Net changes of
items other thanshareholders’equityTotal changes of
items during theperiodBalance at the endof the period

1,421,815

Capital surplus

Retain earnings

2,507,763

20,239,578

Treasury shares△1,499,778

Total shareholders’equity22,669,379△1,564,720
4,557,641

17,402

17,402
1,421,815

2,992,920

2,525,165

23,232,499

Total accumulated other comprehensive income
Foreign
Total
Valuation
currency
accumulated
Deferred gains
difference ontranslationotheror losses onavailable-foradjustment
comprehensive
hedgessale securities
income5,438,242△1,220△97,5825,339,439

△157

△157

6,356

23,7586,199

3,016,522△1,493,579

25,685,901

Non-controllinginterests

Total net assets

99,602

28,108,422△1,564,720
4,557,641△157
23,758△839,909

1,806

109,014△729,087△99,602△828,689△839,909

1,806

109,014△729,087△99,6022,187,832

4,598,333

586

11,432

4,610,352- 11 -

30,296,254

Consolidated Summary Report of Operating Results for Fiscal 2020 (Year ended December 2020) [Japan GAAP]

Consolidated fiscal year under review (from January 1, 2020 to
December 31, 2020)(in thousands of yen)

Shareholders’ equity
Capital stock
Balance at the
beginning of the period
Changes of items
during the period
Dividends fromsurplusProfit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
sharesTransfer to capitalstock from capitalsurplusTransfer to capitalstock from retained
earnings
Net changes of items
other thanshareholders’ equity
Total changes of items
during the period
Balance at the end of
the period

Balance at the
beginning of theperiodChanges of items
during the period
Dividends fromsurplusProfit attributableto owners ofparentPurchase oftreasury shares
Disposal oftreasury shares
Transfer to capitalstock from capitalsurplusTransfer to capitalstock fromretained earnings
Net changes of
items other thanshareholders’equityTotal changes of
items during theperiodBalance at the endof the period

Capital surplus

1,421,815

Retain earnings

2,525,165

23,232,499△1,493,579

Total shareholders’equity25,685,901△1,823,893△1,823,893

3,795,019

3,795,019

21,333
2,525,165

Treasury shares△757,744△757,744

15,661

36,994△2,525,165

53,019△53,019

2,578,184△2,503,831

1,918,106△742,083

1,250,376

4,000,000

21,33325,150,606△2,235,662

26,936,278

Non-controllinginterests

Total net assets

Total accumulated other comprehensive income
Foreign
Total
Valuation
currency
accumulated
Deferred gains
difference ontranslationotheror losses onavailable-foradjustment
comprehensive
hedgessale securities
income4,598,333

586

11,432

4,610,352

30,296,254△1,823,893
3,795,019△757,744
36,994

6,631,516△4,772

2,052

6,628,796

53,323

6,682,119

6,631,516△4,772

2,052

6,628,796

53,3237,932,495

11,229,849△4,185

13,485

11,239,149

53,32338,228,750- 12 -

Consolidated Summary Report of Operating Results for Fiscal 2020 (Year ended December 2020) [Japan GAAP](4) Consolidated statements of cash flows(in thousands of yen）
Previous consolidated
fiscal year
(from January 1, 2019
to December 31, 2019)

Net cash provided by (used in) operating activitie
Profit before income taxes
Depreciation
Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for quality assurance
Increase (decrease) in provision for loss on projects
Interest and dividend income
Interest expenses
Foreign exchange losses (gains)Share of (profit) loss of entities accounted for using equity method
Loss (gain) on change in equity
Loss (gain) on sales of investment securities
Loss on valuation of intangible assets
Loss on realized foreign currency adjustment
Decrease (increase) in notes and accounts receivable- trade
Decrease (increase) in inventories
Increase (decrease) in accounts payable – trade
Increase (decrease) accounts payable – other
Decrease (increase) in other assets
Increase (decrease) in other liabilities
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities- 13 -

6,477,732
991,806
10,119(1,939)26,66054,435
228,746(143,849)
5,130(4,268)(36,619)
4,913—
53,000175,312(831,700)(330,493)
19,878170,212
114,462
274,672
7,258,213
143,865(5,046)(2,394,853)
5,002,178

Consolidated fiscal year
under review(from January 1, 2020
to December 31, 2020）
5,530,655
1,102,489
39,64559,371
18,912(3,971)(241,519)(185,625)
285(3,651)
703
683(93,318)——(866,170)
255,882(276,946)
30,686
189,228
428,632
5,985,976
185,511(650)(1,718,302)
4,452,534

Consolidated Summary Report of Operating Results for Fiscal 2020 (Year ended December 2020) [Japan GAAP]

Previous consolidated
fiscal year
(from January 1, 2019
to December 31, 2019)

Net cash provided by (used in) investing activities
Proceeds from withdrawal of time deposits
Purchase of securities
Purchase of property, plant and equipment
Purchase of intangible assets
Payments for asset retirement obligations
Proceeds from purchase of shares of subsidiaries resulting
in change in scope of consolidation
Purchase of shares of subsidiaries
Purchase of shares of subsidiaries and associates
Purchase of investment securities
Proceeds from sales of investment securities
Payments for lease and guarantee deposits
Proceeds from collection of lease and guarantee deposits
Other
Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities
Repayments of long-term loans payable
Repayments of finance lease obligations
Redemption of bonds
Purchase of treasury shares
Cash dividends paid
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the period
Cash and cash equivalents at the end of the period- 14 -

Consolidated fiscal year
under review(from January 1, 2020
to December 31, 2020）

75,231—(521,497)(467,737)(6,050)(125,320)—(100,091)(121,165)(433,260)——(116,519)(102,000)(600,150)—(18,508)
23,026
3,175(1,856,349)——(110,000)
99,940(17,518)
12,166
3,125(666,802)(374,131)(41,370)(136,000)(157)(1,567,003)(2,118,663)(6,105)
1,021,060
13,908,840
14,929,901(11,472)(108,505)(8,000)(758,502)(1,822,078)(2,708,558)
3,312
1,080,486
14,929,901
16,010,388

Consolidated Summary Report of Operating Results for Fiscal 2020 (Year ended December 2020) [Japan GAAP](5) Notes to consolidated financial statements(Notes on premise of a going concern)
Not applicable.
(Segment information)【Segment information】
1. Overview of reportable segments
The reportable segments of the Group are constituent units of the Company for which separate financial
information can be obtained, and the Board of Directors examines such information on a regular basis
to determine the allocation of management resources and evaluate business performance.
The Group defines the classification of business segments by comprehensively taking into accountmain services, solutions, customers and markets, and has two reportable segments: the IT Consulting &Service Business and Business Innovation Business.
The business operations of the two reportable segments are as follows:
Reportable segments

Business operations

IT Consulting & Service
Business

In this business, the Group helps clients solve problems, by sharing
management issues with them from a managerial perspective,
understanding the essence of the clients’ businesses and establishing
information systems for them using advanced IT.

Business Innovation
Business

In this business, the Group provides original services using IT and
creates business innovations.

2. Methods of calculating net sales, income or loss, assets, liabilities, and other items by reportable segment
The accounting method applied to the above-mentioned business segments is a method in accordancewith the accounting policy applied to the preparation of the consolidated financial statements.
Income of reportable segments is based on operating income.
Inter-segment sales and transfers are based on market prices.

- 15 -

Consolidated Summary Report of Operating Results for Fiscal 2020 (Year ended December 2020) [Japan GAAP]

3. Information on amounts of net sales, profit or loss, assets, and other items by reportable segment
Previous consolidated fiscal year (from January 1, 2019 to December 31, 2019)(in thousands of yen)

Reportable segments

Amount statedin the financial
statements(Note 3)

IT
Consulting& ServiceBusiness

BusinessInnovation
Business

Total

37,340,366

8,049,420

45,389,786—

45,389,786—

45,389,786

52,785

39,211

91,997—91,997△91,997—

Total

37,393,151

8,088,632

45,481,784—

45,481,784△91,997

45,389,786

Segment profit (loss)

6,261,524

26,5406,288,064△4,095

6,283,968

239,641

6,523,610

Segment assets

21,248,292

2,796,709

24,045,001

4,132,329

28,177,331

10,861,888

39,039,219

Depreciation

900,330

38,821

939,151

939,151

52,654

991,806

Amortization of
goodwill

10,119

10,119

10,119

Increase inproperty, plant andequipment andintangible assets

571,705

745,992

745,992

Other (Note
1)

Total

Adjustment(Note 2)

Net sales
Sales to outsideclients
Inter-segment sales
or transfer

Other items

174,287

10,119489,2111,235,204(Notes) 1. “Other,” a segment not included in the reportable segments, includes securities investment, holding, and management
activities.
2. Adjustments to segment profit (loss) and segment assets represent the amount of inter-segment transactions eliminated and income,expenses and assets of the holding company excluding the technology segment.
3. Segment profit (loss) is adjusted with operating income in consolidated financial statements.

Consolidated fiscal year under review (from January 1, 2020 to December 2, 2020)
Reportable segments

Amount statedin the financial
statements(Note 3)

IT
Consulting& ServiceBusiness

BusinessInnovation
Business

Total

37,340,366

8,049,420

45,389,786—

45,389,786—

45,389,786

52,785

39,211

91,997—91,997△91,997—

Total

37,393,151

8,088,632

45,481,784—

45,481,784△91,997

45,389,786

Segment profit (loss)

6,261,524

26,5406,288,064△4,095

6,283,968

239,641

6,523,610

Segment assets

21,248,292

2,796,709

24,045,001

4,132,329

28,177,331

10,861,888

39,039,219

Depreciation

900,330

38,821

939,151

939,151

52,654

991,806

Amortization of
goodwill

10,119

10,119

10,119

Increase inproperty, plant andequipment andintangible assets

571,705

745,992

745,992

Other (Note
1)

Total

Adjustment(Note 2)

Net sales
Sales to outsideclients
Inter-segment sales
or transfer

Other items

174,287

10,119489,2111,235,204(Notes) 1. “Other,” a segment not included in the reportable segments, includes securities investment, holding, and management
activities.
2. Adjustments to segment profit (loss) and segment assets represent the amount of inter-segment transactions eliminated and income,expenses and assets of the holding company excluding the technology segment.
3. Segment profit (loss) is adjusted with operating income in consolidated financial statements.
- 16 -

Consolidated Summary Report of Operating Results for Fiscal 2020 (Year ended December 2020) [Japan GAAP](Per share data)
Previous consolidated fiscal year (fromJanuary 1, 2019 to December 31, 2019)

Consolidated fiscal year under review(from January 1, 2020 to December
31, 2020)

Net asset value per share¥677.50¥862.89

Profit per share¥101.94¥85.49(Notes) 1. Diluted profit per share is not recorded because there are no potential shares.
2. Profit per share is calculated based on the following:
Previous consolidated fiscal year (fromJanuary 1, 2019 to December 31, 2019)

Consolidated fiscal year under review(from January 1, 2020 to December
31, 2020)

4,557,641

3,795,019

Profit attributable to owners of parent
related to common stock (thousands of yen)

4,557,641

3,795,019

Profit attributable to owners of parent
related to common stock (thousands of yen)

44,710,831

44,391,754

Profit per share
Profit attributable to owners of parent(thousands of yen)Amount not available for commonshareholders to common shares (thousandsof yen)(Significant subsequent events)
Not applicable.

- 17 -

Consolidated Summary Report of Operating Results for Fiscal 2020 (Year ended December 2020) [Japan GAAP]

5. Other
Orders received(in thousands of yen)
Category
IT Consulting & Service BusinessBusiness Innovation Business
Total

Category
IT Consulting & Service BusinessBusiness Innovation Business
Total

Order backlog
12,523,723
348,079
12,871,803

Consolidated fiscal year under review(from January 1, 2020 to December
31, 2020)
Orders received
Order backlog
32,429,029
9,516,505
2,337,378
502,759
34,766,407
10,019,264

Third quarter consolidated fiscal year
(from July 1, 2020 to September 30,
2020)
Orders received
Order backlog
7,061,040
9,544,549
577,692
364,669
7,638,732
9,909,218

Third quarter consolidated fiscal year
(From October 1, 2020 to December
31, 2020)
Orders received
Order backlog
9,446,585
9,516,505
720,184
502,759
10,166,770
10,019,264

Previous consolidated fiscal year (fromJanuary 1, 2019 to December 31, 2019)
Orders received
37,906,441
1,851,708
39,758,149- 18 -