Progress and Outlook ofMedium‐term Business Plan
(April 2022 ‐ March 2025)

December 15, 2023

ZUKEN Inc.
Tokyo Stock Exchange, Prime MarketSecurities code: 6947

Summary of Progress and Outlook

1

Assessment at the Mid‐point of the Three‐year Plan and Future Actions
Growth Strategy (1)Growth Strategy (2)Earning PowerEngineering DX Proposition byModel‐Based Development(MBSE/MBD)

Consulting‐Driven Customer
Engagement to Enlarge Business
Scope and ValueConsiders
application of generative AI
⽣成AIの適⽤も検討

Expedite our Sales DX andMaintain Decent Pricing Level forProducts and Services Successful development of a wide
range of industries
 Expansion of applicable businessdomains through diversification ofindustries and purposes The challenge is to secure humanand development resources Strong DX demand in Japansupports the growth Strong orders for wire harness
design data management
 Started collaboration with nVent
HOFFMAN in North America

 Strong IT investments in the manufacturing sector will continue→Many DX ideas, including existing products centered on MBSE
 Continue substantial technology/product development
investments for medium/long‐term growth and consider
measures for hiring and retaining people2 Price revisions
 CR‐5000BD updates scheduled toend in December 2026
 More use of a digital salesplatform Speed up the shift to CR‐8000 Increase operating margin byrevising prices of maintenanceand other services

Topics Two New Products to Meet the DX Needs of Electrical Designers
Automatic placement and routing using AI
Autonomous Intelligent Place and RouteAn optional function for the CR‐8000

Started with an automatic wiring placement androuting capability using a pre‐trained model by
Zuken
Plan to make upgrades to create a system able tolearn on its own the characteristics of designs ofusers and then determine autonomously the best
possible wiring configuration

Started selling 3D EMC Adviser, the industry’s firstelectromagnetic compatibility (EMC) verification
tool that combines electrical and mechanical factors

PCB designers can perform tests forelectromagnetic noise using conditions very
similar to those of the actual product by importing
3D data of the enclosure, harness, and connector
into CR‐8000 Design Force.

Solutions that contribute to handing down the exclusive design
expertise of individual companies as well as improving theproductivity of design3

First Half Results of the Second Yearand Outlook

4Medium‐term Sales/Earnings Targets and 1H FY3/24 Results(Millions of yen)

Sales
(Millions of yen)

45,00040,00040,00035,00035,07337,00031,502
Fullyear

30,00025,00017,87920,000

YoY

15,00014,981

16,103

+11%

7,000

6,000

6,000
5,000
4,000

4,428
3,904

4,600
Full
year

1,996

3,000
2,000

10,000Operating profit

1,851

1,892

1H

YoY

+5%
1H

1,000
5,000
0022.3
FY3/22(Results)
（実績）

23.3
FY3/23(Results)
（実績）

24.3
25.3
FY3/24
FY3/25(Plan)(Plan)（計画）（計画）(1H Results)

22.3
FY3/22(Results)
（実績）

23.3
FY3/23(Results)（実績）

Record‐high 1H sales and operating profit
Results were consistent with the plan at the mid‐pointof the three‐year plan

524.3
25.3
FY3/24
FY3/25(Plan)(Plan)
(計画)
（計画）
（計画）
(上期実績)(1H Results)

Change in 1H FY3/24 Operating Profit(Billions of yen)
Higher sales

Change in grossmargin ratio‐0.1(‐0.01)+1.22(+0.43: of which foreign exchange impact)

Higher personnel
expenses andR&D expenses‐0.68(‐0.29)

Increase inother expenses‐0.34(‐0.07)

1.89

1.99
+0.1

1H FY3/23
Average exchange rates in 1H FY3/23 were 134 yen/USD and 139 yen/EUR.
Average exchange rates in 1H FY3/24 were 141 yen/USD and 153 yen/EUR.

6

1H FY3/24

The Earning Goal in the Plan’s Final Year
(Billions of yen)

Higher sales

Change in grossmargin ratio+0.33

Higher personnel
expenses andR&D expenses

+2.05

‐0.73

Increase inother expenses‐0.26• Benefits from maintenanceand service price hikes

4.60• Speed up the shift to CR‐8000• Higher E3 sales in USA (nVent)

FY3/24(Plan)
Achieving the sales plan will be the key to reaching the earnings goal

76.00
+1.40

FY3/25(Plan)Order Backlog at the End of the First Half
(Billions of yen)

14.0

12.0

12.47

Client services (Maintenance)

YoY
+7.5%

11.60

Solutions

9.68

10.0

8.27
8.0

7.18

6.99
5.89

6.0

4.0

3.75

4.19

4.51

2.0

0.0

1H FY3/20

8

1H FY3/21

1H FY3/22

1H FY3/23

1H FY3/24+18.5%

Major Products of Each Category
Product Categories Used in Financial Reports
Design Automation

Printed Circuit Board
design solutions

CR‐8000 Design Force
CR‐8000 DFM Center
Printed Circuit Board(EDA)

Circuit design solutions

Wire harness

Data Management

IT solutions
Client services*

Major Products

CR‐8000 Design Gateway
E3.series/E3.infinite
Cabling Designer series
DS‐2 series
GENESYS
FortiGate
PreSight/visual BOM

Divided among the above categories*Client services are recurring revenue from the maintenance and updates of licenses.

9Changes in 1H Sales by Product Category(Billions of yen)

Data Management

Electronic DesignAutomation

Wire Harness+0.41+0.86+1.77+0.4916.10

Design Automation

1H FY3/24

1H FY3/23
Electronic Design Automation

Wire Harness Design Continuation of the shift to CR‐
8000 in Japan
 Sales increased in theautomotive electronics sector inSouth Korea
 Official announcement ofplanned CR‐5000BD end ofsupport

 Strong demand for
manufacturing equipment inEurope, USA and Japan Showing a recovery in theaircraft, railroad, andautomobile sectors
 Factory DX demand in Japan
continues

1017.87

Data Management
 Large volume of IT investments
for engineering process updates
triggered by the enterprise ITsystem overhaul Strong performance of datamanagement for wire harnesses Demand for security products iscontinuing

1H Sales and YoY Change by Product Category

Sales (Millions of yen)

1H FY3/23

1H FY3/24

YoYchange

YoYchange (%)

Design Automation

9,664

10,572

+908

+9.4%

(3,236)(3,652)

+416

12.9%

Data Management

6,439

7,306

+867

13.5%

Total

16,103

17,879+1,776

11.0%(of which WH Design)11Reference: 1H Sales by Solution Category in Financial Reports

Sales (Millions of yen)

1H FY3/23

1H FY3/24

YoY change

Printed Circuit Board
design solutions

1,939

2,183+244

Circuit design solutions

3,374

3,802+427

IT solutions

3,611

4,053+441

DataManagement

Client services

7,177

7,838+660

Total

16,103

17,879+1,776

Client services
are divided into
the above twocategories

12DesignAutomation

Growth Sector (1) Sales Associated with Model‐based Development
Overview
 Steady growth of the MBSE business inJapan (industries, business domains) Expect higher demand from the defense
and related sectors in Japan
 GENESYS‐CR: Increasing interest among
current users of CR products in themanagement of electronic design
requirements
 Need to recruit more people andincrease technology/productdevelopment expenditures as MBSE
activities encompass a broader range ofbusiness sectors

13Sales associated with model‐baseddevelopment(Millions of yen)

1,400
1,200

1,085

1,000843
Fullyear

800
600
400

382464

275
1H

200
0

FY3/22(Results)

FY3/23(Results)

FY3/24(Results)

YoY+21.2%

Growth Sector (2) Consulting‐driven Customer Engagement Business Sales
PDM business sales

Overview(Millions of yen)

 In Japan, DX investments are strong in allindustries. The installation and upgradesof ERP (Enterprise Resource Planning)systems are creating a large volume of IT
expenditures for design andmanufacturing operations.
 Investments in wire harness design data
management are increasing for companies
in the manufacturing equipment sector as
the demand for labor‐saving andautomation measures grows (Europe,Japan).
 Anticipate demand for more rigorous
management of the procurement ofelectronic components to build resilient
supply chains and meet the requirementsof decarbonization and other initiatives.

14

6,000

4,901

5,000

4,000

3,956
Full
year

3,000

2,000

2,363
1,593

1,865
1H

1,000

0

FY3/22(Results)FY3/23(Results)

FY3/24(Results)

YoY+26.7%

Change in First Half Sales by Region(Billions of yen)

Average exchange rates in 1H FY3/23 were 134 yen/USD and 139 yen/EUR.
Average exchange rates in 1H FY3/24 were 141 yen/USD and 153 yen/EUR.

Foreign exchange
impactOverseas business +0.43

16.10

Japan+0.26+1.08+5.1%+9.9%+1.77

17.87

Japan 10.9
Europe 3.1
USA1.3Asia
0.8

1H FY3/23151H FY3/24

Change in Sales Rankings of Primary Client Industries in Japan(except client services)
1H FY3/24

FY3/23

FY3/22

FY3/21

1. Office equipment

Automobiles

Vehicle electronics

General electricalmachinery

2. Vehicle electronics

Electronic components

General electricalmachineryCommunications
equipment

3. General electricalmachinery

Office equipment

Automobiles

Electronic components

4. Electronic components

Vehicle electronics

Office equipment

Office equipment

5. Automobiles

Inspection equipment

Construction machinery

Consumer products

6. Consumer products

Vehicle electronics

Industrial machinery

Vehicle electronics

7. Automobiles

Automobiles

Office equipment

Consumer products

8. General electricalmachinery

Electronic components

Consumer products

Consumer products

9. Vehicle electronics

Automobiles

Construction machinery

Automobiles

10. Communications
equipment

Construction machinery

Consumer products

Automobiles

16

Engineering IT investments in a broad range ofindustries continued

Change in First Half Overseas Sales

Average exchange rates in 1H FY3/23 were 134 yen/USD and 139 yen/EUR.
Average exchange rates in 1H FY3/24 were 141 yen/USD and 153 yen/EUR.

Foreign exchange impact(Billions of yen)

Asia

5.17
EuropeUSAAsia(including direct salesin China)

EuropeUSA

‐0.02

+0.07

+0.20

‐0.7%

+5.7%

+25.7%

3.11.30.8+0.43
+0.69

5.87

Sales in local currencies

1H FY3/24

1H FY3/23Europe


24
17

Sales decreased because of alarge order in the previous fiscal
year, but the volume of sales
and orders for the E3.series andDS‐E3 remained high.
Sales are recovering in therailroad and vehicle electronics
categories.

USA



Mainly time‐based license revenue,a stable source of sales
Strong sales to manufacturers ofsemiconductor production
equipment and other industrial
machinery; the aerospace sector isrecovering
Delay in the start of sales throughnVent HOFFMAN, anticipating an
upturn in the second halfAsia
Large volume of orders frommajor customers in South Korea
that manufacture automotivecomponents
In China, investments by Japanesecompanies are declining but there
are positive investments by
Chinese electric vehicle andvehicle electronics manufacturers

Outlook for Business Categories (KSF)2027 end of support for SAP products (ERP) = IT infrastructure update
demand at companies = Positive effects in the PLM/PDM sectors too,resulting in the outlook for IT investments to remain strong• More efficient development/business processes (labor saving, automation)• Provide ideas for data management solutions to meet customers’ needs
involving the green transformation (carbon footprint, etc.) bystrengthening component data management, increasing the resilience of
procurement activities, and making other improvementsAnnouncement of end‐of‐service timing for older products, addition of new
optional functions and other actions to speed up the shift to the CR‐8000



Get the business through nVent HOFFMAN off the ground in North America



MBSE: Continuing investments to make GENESYS even more competitive andappealing18

Capital Policies and Profit Distributions
Actions to achieve management conscious of capital costs and stock prices
Achieve steady business growth to aim for sustainable earnings growth and shareholder
distributions
Maintain financial soundness to enable flexibility and speed for investments for growth,
including M&A
Continue to adhere to the "progressive dividend policy" and, based on the above,
implement measures to return profits to shareholders as appropriate, taking into accountsales and profit forecasts and ROE.

Maintain financial
soundness to enable
flexibility and speed forinvestments for growth Progressive dividend policy Business operations with emphasis
on efficient use of capital

Execute the best possible measures for returning earnings toshareholders based on results of operations, market conditions
and all other applicable factors

19

(Reference) Return on Equity and Shareholder Distributions

Consistent Growth of Dividends
Dividends

Commemorative dividends(Unit: yen)

Dividend
payout ratio
連結配当性向

FY3/20FY3/21

FY3/22

FY3/23

FY3/24
Plan

26.0%

32.6%

28.6%

32.7%

33.7%

4.0billion yen
40億円

Purchaseof treasury shares
⾃⼰株式取得Total総還元性向
payout ratio

2026.0%

32.6%

28.6%

32.7%

153.1%

(Reference) Stock Metrics and Sales and Earnings

(Yen)
5,000

5.0

4,000

4.0

3,440

Stock Metrics

2,826

3,000

3,020
3.0

2,306

2,000

2.0

1,497

1,000

1.7

1.5

1.8

1.9

1.0

1.1
0

0.0
19.3
FY3/1920.3
FY3/20(Millions of yen)

21.3
FY3/21

22.3
FY3/22Market期末時価value atyear‐end

期末PBR
PBR atyear‐end

40,00035,07335,000

Sales and Earnings

30,00026,78729,296

28,81924.3
FY3/2437,000

10.0%

20,00015,000

6.7%

7.7%

7.8%

3,050

8.1%
5.0%

5.8%

10,000
5,000

15.0%

31,50225,000

3,391

2,891

3,904

4,428

20.3
FY3/2021.3
FY3/21

22.3
FY3/22

23.3
FY3/23

4,600
0.0%

019.3
FY3/19

Net
売上⾼
sales

2123.3
FY3/23Operating
営業利益
profitROE（％）ROE (%)

24.3
FY3/24

Corporate Profile

Zuken has started selling the 3D EMC Adviser, the industry’s firstelectromagnetic compatibility (EMC) analysis tool that combines electricaland mechanical factors. (May 2023)

22Corporate Profile

ZUKEN Inc.
Established:
Capital:Employees:

December 17, 1976
10,117,065,000 yen
440 (non‐consolidated)
1,591 (consolidated)(As of September 30, 2023)

Tokyo Stock Exchange, Prime Market
Securities code: 6947
 A Japanese engineering software vendor with global presence More than 40 years of experience in the electronic design automationindustry (Backed by a consistently sound financial position) In‐house development of technologies along with the use of alliances,
M&A and other measures to acquire new technologies quickly as needed23History
December 1976

Established as Zukei Shori Gijutsu Kenkyusho Inc.

June 2009

Announced the release of “PreSight,” a new product of PLM Solutions.

June 1978

Developed Japan's first CAD/CAM system "Create 2000" for the design ofprinted circuit boards.

May 2010

Concluded an equity alliance with Lattice Technology Co., Ltd., making Zuken
the second‐largest shareholder after Toyota.

November 1983

Established ZUKEN AMERICA Inc. (now ZUKEN USA Inc.) in the United States.

June 2011

Announced the release of "visual BOM" that integrated bill of materials
technology with the ultra lightweight 3D format XVL.

January 1988

Developed a new CAD system "CR‐3000."

October 2011

Announced worldwide the release of the "CR‐8000," a new generationelectronic device design platform.

October 1991

Registered in the Second Section of the Tokyo Stock Exchange as a first EDA corporation.

December 2014

Concluded a capital and business alliance with Toyo Business Engineering
Corporation (now Business Engineering Corporation).

January 1992

Established ZUKEN EUROPE GmbH (now ZUKEN GmbH) in Germany.

March 2015

Established ZUKEN INDIA Pte. Ltd. in India.

January 1992

Established ZUKEN KOREA Inc. in Seoul.

July 2015

Took over YDC Corporation's CADVANCE business (CAD and PDM operations).

August 1992

Established ZUKEN SINGAPORE Pte. Ltd. in Singapore.

April 2016

The PreSight Division was spun off as Zuken PreSight Inc.

April 1994

Developed EDA vertical integration solution "CR‐5000."

December 2017

Acquired all the shares of Alfatech Inc. (now Zuken Alfatech Inc.).

June 1994

Acquired all the shares of Racal‐Redac Group (11 companies) of the United Kingdom.

August 2019

Acquired all the shares of Vitech Corporation (now Zuken Vitech Inc.) of USA.

September 1994

Moved up to the First Section of the Tokyo Stock Exchange.

October 2019

Established ZUKEN Modelinx Inc.

March 2000Acquired all the shares of INCASES Engineering GmbH of Germany.

November 2021

Business Engineering Corporation became an equity‐method affiliate
following an additional investment by ZUKEN.

March 2002

Started provision of a wire harness design environment for the automotiveindustry.

April 2022

Stock listing was moved to the Prime Market because of the restructuring ofthe Tokyo Stock Exchange into new market segments.

June 2002

Established Shanghai Technical Center in Shanghai.

February 2004

Announced the release of "ePLM Platform DS‐2," a PLM solution speciallydesigned for the electrical and electronics industries.

August 2005

Established ZUKEN TAIWAN Inc. in Taiwan.

May 2006

Acquired all the shares of CIM‐TEAM (now ZUKEN E3 GmbH) of Germany.

June 2007

Released "V54EE" based on "Catia V5."24

Global Locations and Affiliates in Japan
Head Office/Central Research Facility: Tsuzuki‐ku, Yokohama
Locations in Japan:

Yokohama, Osaka and Nagoya

Overseas Locations:

21 locations, including 6 R&D sites

Domestic Affiliates:

7 (Zuken Tec Inc., Zuken Netwave Inc., Zuken Elmic Inc., Zuken PreSight Inc.,
Zuken Alfatech Inc., Zuken Modelinx Inc., Business Engineering Corporation)

EUROPEUK, Germany, Switzerland,France, Italy, Netherland, PolandAMERICAS

Korea

Japan
China:Sales OfficeTaiwanAsia

India
Singapore25

Zuken GroupZuken Tec
Overseas subsidiaries
EuropeNorth America
Asia

Technology services(including support for model‐
based development activities)

26

Design/manufacturing link

3D mechanicaldesigns

Knowledge/AI

BIM

Security

Telecommunications

Storage

Embedded softwarePrecautions
Information in this presentation includes forward‐looking statements about results ofoperations and other items. These statements are judgments of the Zuken Group basedon information available when this presentation was prepared and include potential risks
and uncertainties. Therefore, actual results of operations and other aspects of future
performance may differ greatly from these forward‐looking statements. Risk factors that
may affect the Zuken Group’s performance include, but are not limited to, changes in theeconomies of various countries, capital expenditures of the group’s customers, changes
in the demand for the group’s products, progress with the development of new products,
competition with other companies, and foreign exchange rate movements.
The performance targets in this presentation are not forecasts or current outlooks forfuture results of operations. These figures are goals that the Zuken Group will attempt toreach by implementing its business strategies.

27

Contact

ZUKEN Inc.
Corporate Marketing Division
2‐25‐1, Edahigashi Tsuzuki‐ku, Yokohama
Tel: +81‐45‐942‐1511