Consolidated Financial Results for the Third Quarter of
the Fiscal Year Ending March 31, 2024 (JGAAP)
January 31, 2024
Company name:
Tsuzuki Denki Co., Ltd.
Listing Stock Exchange: Tokyo
Stock code:
8157
URL: https://www.tsuzuki.co.jp/
Representative (title): Isao Emori, Representative Director, President and CEO
Contact (title):
Toshihiro Hirai, Managing Executive Officer
Tel: +81-50-3684-7780
Scheduled date for quarterly report submission:
Scheduled date for dividend payment:
Preparation of supplemental explanatory materials:
Results briefing to be held:

February 6, 2024
—
None
None

1. Consolidated financial results for the Third quarter of the fiscal year ending March 31, 2024
(April 1, 2023, to December 31, 2023)(1) Consolidated operating results

Net sales

Millions of yen (rounded down), % figures are year-on-year change
Quarterly profit
Operating income
Ordinary income
attributable toowners of parent

Third quarter,
179.8 %
143.1 %
330.1%
year ending
93,013 12.7 %
3,938
3,992
4,187
March 31, 2024
Third quarter,
5.1 %year ended
82,545
2.0 %
1,407
1,642
6.3 %
973
3.4 %
March 31, 2023
Note: Comprehensive income was 5,086 million yen (+277.3 %) in the third quarter of year ending March 31,2024; 1,348 million yen (+10.6%) in third quarter of year ended March 31, 2023.
Earnings per share
Diluted earnings per(yen)share (yen)Third quarter,year ending
233.19—March 31, 2024
Third quarter,year ended
54.68—
March 31, 2023
(2) Consolidated financial position
Total assets
Net assets
Shareholders’
Net assets per share(millions of yen)(millions of yen)equity ratio(yen)Third quarter,year ending
81,36539,04647.5 %
2,143.82
March 31, 2024
Year ended
83,20735,38742.0 %
1,950.05
March 31, 2023
Reference: Shareholders’ equity at the third quarter of year ending March 31, 2024; 38,617 million yen; in year
ended March 31, 2023; 34,945 million yen.

1

2. Dividends
Dividends per share for the fiscal year (yen)End offirstquarter

End ofsecondquarter

End ofthird
quarterYearendTotal

Year ended
—
25.00
—
36.00
61.00
March 31, 2023
Year ending—
38.00
March 31, 2024
Year ending
March 31, 2024
—
51.00
89.00
(forecast)
Note: 1.Revisions to most recent dividend forecast: Yes
2.The interim dividend for the year ended March 31, 2023 included a commemorative dividend of 2.0 yen
per share to celebrate 90th Anniversary of its founding.

3. Forecast of consolidated financial results for the fiscal year ending March 31, 2024
(April 1, 2023, to March 31, 2024)% figures are year-on-year change
Profit attributable to Earnings
Net sales
Operating income Ordinary income
owners of parent
per share(millions of yen)(millions of yen)(millions of yen)(millions of yen)
(yen)
Full year

124,000

0.1%

6,000

17.2%

6,000

Note: Revisions to most recent earnings forecast: Yes

2

12.0%

4,800

36.3%

267.09

*Notes(1) Changes in significant subsidiaries (which affected scope of consolidation) during the quarter: None
Newly added ___ companies (names)
No longer consolidated ___ companies (names)(2) Special accounting methods used in preparation of quarterly consolidated financial statements: Yes
Note: For details, please refer to Attachment page 14 “2. Consolidated financial statements and notes (3) Notes
to quarterly consolidated financial statements (Application of special accounting methods in the
preparation of quarterly consolidated financial statements)."(3) Changes in accounting policies, changes in accounting estimates, and restatements
1. Changes in accounting policies due to changes in accounting standards:
2. Changes in accounting policies not due to changes in accounting standards:
3. Changes in accounting estimates:
4. Restatements:

None
None
None
None

(4) Number of shares outstanding (common stock)
1. Number of shares outstanding at
Third quarter,Year ended
year end (including treasury
year ending
20,177,894
20,177,894
March 31, 2023
stock)March 31, 2024
Third quarter,
2. Number of shares at year end
Year ended
year ending
2,164,582
2,257,664(treasury stock)
March 31, 2023
March 31, 2024
Third quarter,
Third quarter,
3. Average number of shares overyear ending
17,957,690
year ended
17,803,153
the period
March 31, 2024
March 31, 2023
Note: The number of treasury shares includes those held in the Employee Stock Ownership Plan (ESOP) trust
account (0 in the third quarter of year ending March 2024; 13,300 in year ended March 2023), Directors’Compensation Board Incentive Plan (BIP) trust account (420,447in the third quarter of year ending March 2024;
290,547 in year ended March 2023); and Stock-grant ESOP trust account (340,979 in the third quarter of year
ending March 2024; 420,865 in year ended March 2023).
*The financial information in this quarterly report is not subject to review by certified public accountants or auditing
firms.
*Appropriate use of earnings forecast and other special notes.
(Note on forward-looking statements)
The earnings forecasts and other forward-looking statements contained in this document are based on
information currently available to the Company, and certain assumptions it considers reasonable, but are notintended to be a promise that the Company will make. Actual results may vary materially from forecasts due to avariety of factors.

3

Content of attachment
1. Qualitative information on quarterly results ..............................................................................................5(1) Earnings ..............................................................................................................................................................5(2) Financial position ...............................................................................................................................................9(3) Consolidated earnings forecasts and other information concerning the outlook .....................................9
2. Consolidated financial statements and notes .........................................................................................10(1) Quarterly consolidated balance sheet ..........................................................................................................10(2) Quarterly consolidated statements of income and comprehensive income ...........................................12(3) Notes to quarterly consolidated financial statements .................................................................................14(Notes on premise of going concern)..............................................................................................................14(Notes on significant changes in the amount of shareholders equity) .......................................................14(Application of special accounting methods in the preparation of quarterly consolidated financial
statements) .........................................................................................................................................................14(Segment and other information).....................................................................................................................15

4

1. Qualitative information on quarterly results(1) Earnings
In the second half of the fiscal year ending March 2024, the Japanese economy showed signs of a gradual
recovery as economic and social activities began to return to normal. However, the risk of a downturn in overseas
economies due to global monetary tightening and other factors exerted downward pressure on Japan's economy.
This, combined with the effects of rising prices, supply-side constraints, and fluctuations in financial and capital
markets, among other issues, rendered the outlook uncertain.
In the information and communications services industry, to which the Group belongs, companies' appetite forinvestment remained strong, mainly for the maintenance and renewal of aging facilities, which had been
restrained by the pandemic. The trend of expanding ICT capital investment continued, including the promotion ofdigital transformation (DX), which has become increasingly important in recent years. As for the electronic device
industry, while the supply-demand balance for semiconductors was moving toward normalization, there was a
slowdown in market growth due to uncertainty about the future, including a decline in personal consumption due
to rising global prices and geopolitical risks associated with the prolonged Russia–Ukraine conflict.
Under these circumstances, the Group established a long-term vision spanning 10 years from the current fiscal
year, and we are currently in the middle of a three-year medium-term management plan, “Transformation 2026,”
toward achieving the long-term vision. In 10 years’ time, we envision ourselves to be Growth Navigator, anorganization that navigates growth and creates together with stakeholders, including customers. We aim to be acompany that continues to be chosen by customers as an organization that leads the way for growth. Having
positioned the next three years as the first stage toward realizing this goal, we will concentrate and transfer
resources to growth areas and strive to bolster our earnings capability. Further, to enhance corporate value, themost important theme for the Group, we will promote integrated measures spanning all aspects of business,finance, and non-finance, including management mindful of the cost of capital and strengthening of personnel
capital. Based on this strategy, the Company decided to transfer all shares of four Group companies engaged inbusiness in the Electronic Devices segment to Restar Holdings Corporation on January 9, 2024. Going forward,
we will concentrate our management resources on the Information Network Solutions segment, which operates ingrowth areas, to achieve sustainable growth and further enhancement of the Group’s corporate value.
During the first nine months of the first year of the medium-term management plan, net sales amounted to¥93,013 million (up 12.7% year on year), operating income was ¥3,938 million (up 179.8% year on year), ordinary
income totaled ¥3,992 million (up 143.1% year on year), and quarterly profit attributable to owners of the parent
was ¥4,187 million (up 330.1% year on year).
In the Information Network Solutions segment, orders fell below the year-earlier level mainly due to a decline inlarge orders for equipment. However, net sales increased from the year-earlier level on contributions mainly frommobile PC sales and network equipment sales and construction projects. Profits reached a record high for the firstnine months of a fiscal year owing to substantial growth in sales and an improvement in the cost ratio, evendespite higher SG&A expenses stemming from stepped-up investments in HR development and other aspects ofhuman capital and costs associated with in-house system upgrades.
In the Electronic Devices segment, demand for semiconductors and power semiconductors weakened due tocustomer production adjustments in the factory automation/industrial equipment sector and customer inventory
adjustments for air conditioners, even though sales of LCD panels for in-vehicle information equipment, among
others, increased as the shortage of semiconductors came to an end. As a result, orders decreased, but net sales
were up year on year. Profits were lower year on year due to an increase in SG&A expenses.
In the second quarter, for the purposes of effective utilization of management resources and improvement ofasset efficiency, the Company transferred fixed assets held by our company and a consolidated subsidiary. As aresult of this transfer, the Company posted extraordinary income of ¥1,854 million, and quarterly profit attributableto owners of parent increased significantly year-on-year.
The following section discusses earnings by segment in the third quarter.
*Note regarding quarterly earnings for the Group5

Many of the Group’s customers have business years from April through March of the following year. Further,fulfilment obligations for many transactions are judged to be satisfied at a certain point, so the Group’s sales andprofit tend to be concentrated in September and March, the halfway and endpoints of the fiscal year.

6Information Network Solutions
In the first nine months of the fiscal year ending March 31, 2024, orders totaled ¥68,534 million (down 8.9%
year on year), net sales were ¥70,679 million (up 16.9% year on year), and operating income was ¥3,423 million(up 434.8% year on year). Orders declined but both net sales and operating income were up year on year.
Results by business model
Equipment: Orders dropped below the year-earlier level due chiefly to a decrease in large-scale projects, but net
sales remained brisk by virtue of the continued adoption of mobile PCs by mainly public sector andreal estate industry customers, as well as sales of server and network equipment. As a result, orders
were ¥26,255 million (down 18.9% year on year) and net sales were ¥29,107 million (up 39.1% year
on year).
Development and construction: Owing to the continued strong performance of network construction services to awide range of customers, particularly those in the manufacturing and transportation sectors, as well as
steadily increasing sales from small and mid-sized system developments and infrastructure
construction projects, both orders and sales increased year on year, with orders of ¥10,348 million (upService:

0.4% year on year) and net sales of ¥10,415 million (up 18.6% year on year).
Orders declined slightly on the impact of operational services expiring for some customers in the firstquarter, but net sales of cloud services in general and operational services were firm. As a result,orders came to ¥31,931 million (down 2.0% year on year) and net sales were ¥31,156 million (up1.3% year on year).

Profits increased year on year due to higher sales and an improved cost ratio, in spite of higher SG&A
expenses.
Electronic Devices
In the first nine months of the fiscal year ending March 31, 2024, orders were ¥19,474 million (down 23.1% year
on year), net sales totaled 22,333 million (up 1.1% year on year), and operating income was ¥487 million (down
34.2% year on year).
In the devices business, whilst the production of automotive equipment at customers stabilized in line with therecovery in semiconductor supply, sales of power semiconductors and electronic components were dented by
reduced production output by customers in the factory automation/industrial equipment sector due to weakerpersonal consumption and a slowing Chinese market caused by inflation. As a result, both orders and net sales
decreased year on year.
In the systems business, prices dropped in the memory market due to inventory adjustments, reflecting therecovery in semiconductor supply, while demand for consumer equipment applications weakened. On the other
hand, the automotive market remains firm and sales were thus boosted by growing demand for LCD panels for invehicle information equipment and embedded devices for industrial equipment. As a result, even though orders
fell below the year-earlier level, net sales rose year on year.
Profits declined year on year as a result of higher SG&A expenses due to such factors as securing personnel
for expanding existing businesses and building new business models.

7

The following tables show sales and orders by segment in the third quarter of the fiscal year ending March, 2024.
(1) Net sales by segment (millions of yen)
Third quarter,year ended
March 2023
Information Network Solutions
60,454Equipment
20,922Development and construction
8,781
Service30,750Electronic Devices
22,091
Total
82,545
Note: Inter-segment transactions are offset and eliminated.

Third quarter, year ending March 2024
Versus third quarter ofprevious year
70,67929,107
10,41531,15622,33393,013

10,225
8,185
1,634
405
241
10,467116.9%
139.1%
118.6%
101.3%
101.1%
112.7%(2) Orders by segment (millions of yen)
Third quarter,year ended
March 2023
Information Network Solutions
75,244Equipment
32,359Development and construction
10,306
Service
32,578
Electronic Devices
25,331
Total
100,576
Note: Inter-segment transactions are offset and eliminated.

Third quarter, year ending March 2024
Versus third quarter ofprevious year
68,53426,255
10,34831,931
19,47488,009(6,709)(6,104)41(647)(5,857)(12,567)

91.1%
81.1%
100.4%
98.0%
76.9%
87.5%

(3) Order backlog by segment (millions of yen)
Third quarter,
Third quarter, year ending March 2024
year ended
Versus third quarter ofMarch 2023
previous year
Information Network Solutions
32,06423,713(8,351)74.0%
Equipment
21,755
14,590(7,164)
67.1%
Development and construction
5,997
4,603
(1,393)76.8%
Service
4,312
4,519
207
104.8%
Electronic Devices
19,676
15,782(3,894)80.2%
Total
51,74139,496(12,245)76.3%
Note: 1.Inter-segment transactions are offset and eliminated.
2. In January 9, 2024, the company had resolved to transfer all of the outstanding shares in its consolidated
subsidiaries of the Electronic Devices business segment, Tsuzuki Embedded Solutions Co., Ltd., Tsuzuki
Densan Trading (Shanghai) Co., Ltd., Tsuzuki Densan Hong Kong Co., Ltd., and Tsuzuki Densan Singapore
Pte. Ltd. to the corporate group consisting of Restar Holdings Corporation.

8

(2) Financial position
Assets totaled ¥81,365 million at the end of the quarter under review, down by ¥1,841 million from the end of
the previous fiscal year. The main factors of decrease were a ¥4,874 million decrease in notes and accounts
receivable–trade and contract assets and a ¥1,588 million decrease in land, while the main factors of increase
were a ¥2,826 million increase in cash and deposits and a ¥1,878 million increase in inventories.
Liabilities totaled ¥42,319 million at the end of the quarter, down by ¥5,501 million from the end of the previous
year. The main factors of decrease were a ¥4,377 million decline in notes and accounts payable–trade and a¥1,269 million decline in provision for bonuses.
Net assets totaled ¥39,046 million at the end of the quarter, up by ¥3,659 million from the end of the previous
year, and the shareholders’ equity ratio was 47.5% (42.0% at the end of the previous year). The main factors ofincrease were an increase in retained earnings owing to the booking of ¥4,187 million in profit attributable toowners of parent and a ¥573 million increase in valuation difference on available-for-sale securities, while themain factor of decrease was a decline in retained earnings due to the ¥1,379 million payment of dividends fromsurplus.

(3) Consolidated earnings forecasts and other information concerning the outlook
As announced in a press release titled “Notice of Change in Consolidated Subsidiaries (Share Transfer)” as of
September 29, 2023, on January 9, 2024, we removed four Group companies operating in the Electronic Devices
segment from the scope of consolidation. This resulted in a lower-than-expected net sales forecast. On the other
hand, profits exceeded our forecasts because of strong earnings in the Information Network Solutions segment
centering on the business for customers in the manufacturing industry and the public sector, as well as steadyprogress being made on expanding growth areas and improving the profitability of existing businesses as part of
the Transformation 2026 medium-term management plan that kicked off this fiscal year.
For details, please refer to “Revisions to Full-Year Consolidated Earnings Forecasts and Planned Dividends”
disclosed on January 31, 2024.

92. Consolidated financial statements and notes(1) Quarterly consolidated balance sheet(Millions of yen)
As of March 31, 2023
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable – tradeand contract assets
Electronically recorded monetary claims
Inventories
Other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures (net)
Machinery, equipment and vehicles
Accumulated depreciation
Machinery, equipment and vehicles
(net)
Land
Lease assets
Accumulated depreciation
Lease assets (net)
Construction in progress
Other
Accumulated depreciation
Other (net)Total property, plant and equipment
Intangible assets
Goodwill
Lease assets
Other
Total intangible assets
Investments and other assets
Investment securities
Long-term loans receivable
Deferred tax assets
Other
Allowance for doubtful accounts
Investments and other assets
Total noncurrent assets
Total assets

10

As of December 31, 2023

20,877

23,703

27,86622,992

4,383
11,6832,391(5)67,196

4,547
13,5622,356(11)
67,1502,122(1,003)
1,118
7
(6)

1,586
(697)
888
7
(6)

1

1

1,804
4,367
(3,260)
1,106
124
1,217
(868)
349
4,504

215
2,953
(2,122)
831
59
1,318
(931)
387
2,384

45
632
1,933
2,610

－
589
2,239
2,828

3,471
28
4,265
1,180
(49)
8,896
16,011
83,207

3,909
21
3,941
1,172
(43)
9,001
14,21581,365

(Millions of yen)
As of March 31, 2023
Liabilities
Current liabilities
Notes and accounts payable – trade
Short-term loans payable
Current portion of long-term loans payable
Lease obligations
Income taxes payable
Provision for bonuses
Other
Total current liabilities
Noncurrent liabilities
Long-term loans payable
Lease obligations
Deferred tax liabilities
Net defined benefit liability
Long-term accounts payable – other
Provision for share awards
Other
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive
incomeNoncontrolling interests
Total net assets
Total liabilities and net assets

11

As of December 31, 2023

17,144
4,853
141
888
968
2,513
6,550
33,06012,766
4,747
7
685
814
1,243
8,052
28,318

4,111
998
7
8,826
28
637
149
14,76047,820

4,106
854
6
8,183
28
627
195
14,001
42,3199,812
2,581
25,607(1,979)36,0229,812
2,756
28,415(2,052)38,932

1,132

1,705

2
193
(2,405)3
246(2,270)(1,076)(315)

441
35,387
83,207429
39,04681,365

(2) Quarterly consolidated statements of income and comprehensive income(Quarterly consolidated statement of income)(Millions of yen)
Nine months ended
December 31, 2022
Net sales
Cost of sales
Gross profit
Selling, general, and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Foreign exchange gains
Insurance income
Dividends income of insurance
Other
Total non-operating income
Non-operating expenses
Interest expenses
Facility move out expenses
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sale of non-current assets
Gain on sales of investment securities
Total extraordinary income
Extraordinary loss
Loss on retirement of noncurrent assets
Loss on valuation of investment securities
Loss on valuation of golf club membership
Total extraordinary losses
Income before income taxes and others
Income taxes
Net income
Profit attributable to noncontrolling interests
Profit attributable to owners of parent

12

Nine months ended
December 31, 2023

82,54566,934
15,61014,203
1,407

93,01374,70318,30914,371
3,938

4
97
40
42
73
78
336

11
90
40
3
0
41
187

87
－
13
101
1,642

69
34
30
133
3,992

－
0
0

1,854
6
1,860

4
－
－
4
1,638
506
1,132
158
973

16
33
1
51
5,801
1,477
4,324
136
4,187

(Quarterly consolidated statement of comprehensive income)(Millions of yen)
Nine months ended
December 31, 2022
Net income
Other comprehensive income
Valuation difference on available for salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Other comprehensive income
Comprehensive income
BreakdownComprehensive income attributable to ownersof parent
Comprehensive income attributable tononcontrolling interests

13

Nine months ended
December 31, 2023

1,132

4,324

(7)

573

74
27
121
215
1,348

0
52
134
761
5,086

1,189

4,949

158

136

(3) Notes to quarterly consolidated financial statements(Notes on premise of going concern)
Not applicable.

(Notes on significant changes in the amount of shareholders equity)
Not applicable.
(Application of special accounting methods in the preparation of quarterly consolidated financial statements)(Calculation of tax expense)
Tax expenses are calculated by reasonably estimating the effective tax rate after applying tax effect accounting
to income before income taxes for the fiscal year, including the third quarter, and multiplying quarterly income
before income taxes by the estimated effective tax rate.
Note: Income taxes – deferred are included in income taxes.

14

(Segment and other information)
Segment information
I Third quarter of previous year (April 1, 2022, to December 31, 2022)
1. Information on net sales and profit or loss by reporting segment(Millions of yen)Amountrecorded inquarterly
Adjustments
consolidated(Note 1)
financialstatements(Note 2)

Reporting segment
Information
Network
SolutionsElectronic
Devices

Total

Net sales
Net sales from externalcustomers
Intersegment net sales andtransfers
Total
Segment profit

60,45422,09182,545－82,545

19

140

160

(160)

－

60,473

22,23282,705(160)

82,545

640

740

1,380

26

1,407

Notes:
1 Adjustments to segment profit are elimination of intersegment transactions.
2 Segment profit is adjusted with operating income in the quarterly consolidated income statements.
II Third quarter in current year (April 1, 2023, to December 31, 2023)
1. Information on sales and profit or loss by reporting segment(Millions of yen)Amountrecorded inquarterly
Adjustments
consolidated(Note 1, 2, 3)
financialstatements(Note 2)

Reporting segment
Information
Network
SolutionsElectronic
Devices

Total

Net sales
Net sales from externalcustomers
Intersegment net sales andtransfers
Total
Segment profit

70,67922,33393,013－93,013

24

93

118

(118)

－

70,70422,427

93,131(118)

93,013

3,423

487

3,910

27

3,938

Notes:
1 Adjustments to segment profit are elimination of intersegment transactions.
2 Segment profit is adjusted with operating income in the quarterly consolidated income statements.

15