4. Business Results(1) Business Results for the First Nine Months for the Fiscal Year Ending March 31, 2021

During the first nine months under review (the period from April 1, 2020 to December 31,2020), the Japanese economy was faced with an inevitable, sharp decline due to the impact of theCOVID-19 pandemic, which led to the government’s declaration of a state of emergency in April.
Although the economy showed signs of temporary recovery after the lifting of the state ofemergency at the end of May, the Japanese economy remains severe, including the new wave ofCOVID-19 infections starting November.

Under these economic conditions, the COVID-19 pandemic differently affected theinformation and communication technology (ICT) market, the business domain where NEC
Networks & System Integration Corporation (hereinafter “NESIC”) operates, with the impact
emerging in some areas.
In the enterprises market, companies maintained a high level of investment in workstyleinnovation, such as the introduction of teleworking in the wake of measures against the COVID-19
pandemic. Interest in cutting-edge technologies also remained high, including digitaltransformation (DX), such as cloud computing, artificial intelligence (AI), Internet of Things (IoT)
and robotic process automation (RPA). However, companies took a more rigorous approach totheir investments due to the deteriorated financial performance and other concerns andpostponed non-urgent ICT investments such as system replacement.

Meanwhile, capital

investment by telecom carriers remained robust for migration to 5G and enhancements on thequality of telecommunications. Central and local governments and public interest-relatedorganizations continued their system investment in sophisticated urban infrastructure, such as
firefighting and disaster prevention and broadcasting, video transmission and CATV, although
there was some impact such as project delay. The ICT investment needs for the educational
market such as GIGA school initiative and remote (online) classes also rapidly increased.

In this market environment, the NESIC Group actively engaged in projects that emerged in
the workstyle innovation business, ICT investment for the educational market and infrastructuredevelopment investment for telecom carriers.
Under the Medium-Term Management Plan, “Beyond Borders 2021,” established in May
2019, we aim to be a “communication services orchestrator” that produces new social value using
our strengths and in collaboration with our partners. We consider solving social issues and a waveof technological innovation as an opportunity for business expansion and are focusing on a shift toa new business model and business creation based on digital and 5G communication.
Based on this concept, we have been practicing distributed work since October 2019 in ourworkstyle innovation-related business, in which we have been engaged since 2007. The head
office space has been reduced and head office staff members are separately assigned to satellite
offices in the suburban areas of Tokyo that are within 30 minutes from their homes. The purpose isfor our staff to experience workstyles that help create innovation for the future and provide ourcustomers with a variety of solutions for workstyle innovation through the outcomes of theinitiatives by using DX technology. During the first nine months under review, we carried out
business using telecommuting following the state of emergency in April by using this system andtechnology. As measures to prevent the spread of COVID-19, a recent social issue, we shared ourworkstyle expertise with our customers and promptly responded to the introduction of distributed
work and building platforms for teleworking, remote and online classes, and other settings. Inaddition, we used the DX technology to implement a variety of initiatives and accelerate solution
development corresponding to new workstyle (workstyle in the New Normal era) created jointlywith our partners such as increasing the efficiency of operation and communication, and digitizing
approval procedures. In November 2020, we also established the Basic Technology Development
Center as a place to cultivate human resources, evaluate and verify new technologies and create
new services, and set up the 5G Laboratory with real 5G equipment and facilities able to verify
services. In these bases, we will strengthen the development of engineers in the 5G area, where
the future market expansion is expected, and develop and verify new services using 5G throughco-creation with our customers and partners. In the local 5G area with market potential, we areproceeding with trial experiments and proposition activities in areas including CATV, disasterprevention and disaster mitigation, and have already advanced trial experiments in areas such as
regional invigoration and disaster prevention, mainly with CATV providers. In addition, we areconducting joint trial experiments with Mitsui Fudosan Co., Ltd. to establish smart buildings using
local 5G and to provide new workstyle services for the coming Digital x 5G era. In the 5G area, wewill continue to accelerate our business development, taking advantage of our strengths in theinfrastructure, such as base stations and core networks to services for enterprises.
As a result, the Group posted the following consolidated results for the first nine months for thefiscal year under review:

Net sales¥233,469 million

9.1% increase year on year

Operating income¥13,803 million

68.2% increase year on year

Ordinary income¥13,856 million

69.0% increase year on year

Net income attributable¥8,358 million

94.5% increase year on year

¥253,488 million

17.8% increase year on year

to owners of the parent＜Reference＞
Orders received

Net sales increased 9.1% year on year, to ¥233,469 million. This result reflected increased sales
in all segments, with the expansion of ICT services related to workstyle innovation using DX
technology and infrastructure development for telecom carriers, in addition to GIGA school
projects' contribution to sales and the domestic construction business particularly for the megasolar projects. Orders received increased 17.8% year on year, to ¥253,488 million. This result

reflected GIGA school projects' significant contribution to orders received, expansion of demand
for teleworking in the businesses related to DX and workstyle innovation, and services for telecom
carriers.
Profit increased thanks to a decrease in the provision for loss for unprofitable projects in theEngineering & Support Services business in addition to progress in profitability improvement
through an increase in net sales and resource efficiency, and thorough project management. This
more than offset the investment in growth, such as new service development and human resourcedevelopment. Accordingly, operating income rose 68.2% year on year, to ¥13,803 million, andordinary income improved by 69.0%, to ¥13,856 million. Net income attributable to owners of theparent increased by 94.5%, to ¥8,358 million.

Operating results by business segment were as follows:（Million yen）

Net sales by business segment
Engineering &Digital

NetworkSolutions

Infrastructures

Support Services

OtherTotal

business

9M Fiscal 2021.3

83,776

60,38482,027

7,279

233,469

9M Fiscal 2020.3

80,72756,006

68,605

8,694

214,032

Increase or (decrease)

3,049

4,378

13,422(1,414)

19,436

3.8

7.8

19.6

(16.3)

9.1

Ratio ofincrease/(decrease) (%)（Million yen）

Reference: Orders received by business segment
Engineering &Digital

NetworkSolutions

Infrastructures

Support Services

OtherTotal

business

9M Fiscal 2021.3

97,112

71,56077,356

7,459

253,488

9M Fiscal 2020.3

82,85562,36363,012

6,982

215,214

Increase or (decrease)

14,256

9,196

14,343477

38,273

17.2

14.7

22.8

6.8

17.8

Ratio ofincrease/(decrease) (%)

1. Digital Solutions businessNet sales increased 3.8% year on year, to ¥83,776 million, reflecting expansion of ICT
services related to workstyle innovation using DX technology and GIGA school projects at asubsidiary.
2. Network Infrastructures businessNet sales rose 7.8% year on year, to ¥60,384 million, reflecting expansion of services fortelecom carriers.
3. Engineering & Support Services businessNet sales rose 19.6% year on year, to ¥82,027 million, reflecting expansion of local GIGA
school projects and mega-solar projects.
*EmpoweredOffice:EmpoweredOffice is our office innovation solution. It combines our strengths in ICT
and facility installation to enable more intellectual and creative styles of work throughprocess reforms. It also proposes new methods and places of work that enable
customers to fulfill their social responsibilities, such as the strengthening of security
and environmental responsiveness.

<Outline of Business Segments>Business Segment

Descriptions of Main Businesses
Mainly system integration related to ICT platform and outsourcing/cloudservices for business of enterprises and other customers and provision

Digital Solutionsof solutions/services that are helpful for customers’ business
transformation by using cutting-edge/digital technologies , and contact
center services
Mainly centered on telecom carriers, central and local governments
and social infrastructures service providers, provide system

Network

integration/services related to network infrastructures of a public

Infrastructuresnature with the required high reliability, and thedevelopment/manufacture and sales of network equipment, andprovide system integration.
Construction business in Japan and abroad, provision of support
services such as maintenance and operations/monitoring related toEngineering & Support

ICT systems/services provided by the Company and operations ofServices businesscompany-wide service infrastructures, in addition to technical support
using these.

OthersSales of purchased equipment(2) Outlook for the Fiscal Year Ending March 31, 2021
The situation of the COVID-19 pandemic does not allow for optimism, given the re-issuance of astate of emergency in January 2021 following a sharp rise in the number of infections from the end oflast year. While it is expected that demand for teleworking in the businesses related to DX andworkstyle innovation will continue to expand in the enterprise area, the business domain where weoperate, the reduction and postponement of non-urgent ICT investments by client companies arecoming to the surface.

In services for telecom carriers, given that the migration to 5G

communication systems is starting, we expect that capital investment will remain steady. In addition,in business for central and local governments and public interest-related organizations, platform
development for GIGA school projects will begin in earnest.
Under the conditions described thus far, we revised our forecasts upward for the full-year
consolidated results for the fiscal year ending March 31, 2021, in view of the progress up to the firstnine months under review, as mentioned below. Although there is a concern that ICT investments will
be increasingly limited by the prolonged COVID-19 pandemic, we are determined to focus on the
proposal of a new workstyle in the New Normal era using DX technology, business expansion fortelecom carriers, and the execution of GIGA school projects for which we received orders.

Net sales¥333 billion

9.7% increase year on year

Operating income¥22.0 billion

35.4% increase year on year

Ordinary income¥22.0 billion

38.0% increase year on year

Net income attributable¥13.5 billion

43.3% increase year on year

to owners of the parent