Consolidated Financial Results
for the Nine Months Ended December 31, 2021
[Japanese GAAP]
February 07, 2022
Company name: TOSHIBA TEC CORPORATION
Stock exchange listing: Tokyo
Code number: 6588
URL: https://www.toshibatec.co.jp/
Representative: Hironobu Nishikori
President and CEO
Contact:
Akira Abe
Senior Manager of Corporate Communications Division
Phone: 03-6830-9151
Scheduled date of filing quarterly securities report: February 09, 2022
Scheduled date of commencing dividend payments: Availability of supplementary briefing material on quarterly financial results: No
Schedule of quarterly financial results briefing session: No(Amounts of less than one million yen are rounded down)
1. Consolidated Financial Results for the Nine Months Ended December 31, 2021 (April 01, 2021 to December 31, 2021)(1) Consolidated Operating Results(% indicates changes from the previous corresponding period.)
Profit attributable to
Net sales
Operating profit
Ordinary profit
owners of parent
Million yen%
Million yen%
Million yen%
Million yen%
Nine months ended
December 31, 2021
328,525
11.8
8,664
171.0
8,076
220.3
6,193
December 31, 2020
293,927(19.7)
3,197(76.1)
2,521(79.8)(3,374)(Note) Comprehensive income:Nine months ended December 31, 2021: ¥6,610 million [-%]Nine months ended December 31, 2020: ¥(5,164) million [-%]Basic earnings
per share

Diluted earnings
per share

Yen
Yen
Nine months ended
December 31, 2021
112.55112.52
December 31, 2020
(61.34)(Note) Diluted earnings per share for the nine months ended December 31, 2020 is not presented even though The Company has
issued potential shares, because basic earnings per share was net loss.

(2) Consolidated Financial Position
Total assets
Million yen
As ofDecember 31, 2021
301,158
March 31, 2021
289,313(Reference) Equity: As of December 31, 2021:
As of March 31, 2021:

Net assets

Capital adequacy ratio

Million yen¥¥

114,450
109,862
108,335 million
102,710 million

%

36.0
35.5

2. Dividends
Annual dividends
1stquarter-end

2ndquarter-end

3rdquarter-end

Yen

Yen

Yen

Yen

Yen

20.00

20.00

20.00

40.00

Year-end

Fiscal year ended March 31, 2021

-

0.00

-

Fiscal year ending March 31, 2022

-

20.00

-

Fiscal year ending March 31, 2022
(Forecast)(Note) Revision to the forecast for dividends announced most recently:

Total

No

3. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2022(April 01, 2021 to March 31, 2022)(% indicates changes from the previous corresponding period.)
Profit attributable to Basic earnings
Net sales
Operating profit
Ordinary profit
owners of parent
per share%

Million yen%

Million yen%

Yen

Full year
445,000
9.7
15,00081.5(Note) Revision to the financial results forecast announced most recently:

Million yen%

Million yen

12,000
Yes

66.8

8,000

12.3

145.38* Notes:(1) Changes in significant subsidiaries during the nine months ended December 31, 2021
(changes in specified subsidiaries resulting in changes in scope of consolidation):
No(Company name:New
Exclusion:(Company name:))(2) Accounting policies adopted specially for the preparation of quarterly consolidated financial statements:
Yes(Note) For details, please refer to “2. Quarterly Consolidated Financial Statements and Notes (3) Notes to the quarterly consolidated
financial statements (Accounting policies adopted specially for the preparation of quarterly consolidated financial statements)” on
page 9 of this report.
(3) Changes in accounting policies, changes in accounting estimates and retrospective restatement
1) Changes in accounting policies due to the revision of accounting standards: Yes
2) Changes in accounting policies other than 1) above: No
3) Changes in accounting estimates: No4) Retrospective restatement: No(Note) For details, please refer to “2. Quarterly Consolidated Financial Statements and Notes (3) Notes to the quarterly consolidated
financial statements (Changes in accounting policies)” on page 10 of this report.
(4) Total number of issued shares (common shares)
1) Total number of issued shares at the end of the period (including treasury shares):December 31, 2021:
57,629,140 shares
March 31, 2021:
57,629,140 shares2) Total number of treasury shares at the end of the period:
December 31, 2021:
2,596,268 shares
March 31, 2021:
2,616,163 shares
3) Average number of shares during the period:
Nine months ended December 31, 2021:
Nine months ended December 31, 2020:

55,024,780 shares
55,003,891 shares* Quarterly financial results reports are exempt from quarterly review conducted by certified public accountants or an audit
corporation.
* Proper use of earnings forecasts, and other special matters(Explanation for the proper use of earnings forecasts)
Financial results forecasts are based on information currently available to the Company and certain assumptions deemed reasonable,
and are not intended to be the Company’s guarantee that they will be achieved. Actual results may significantly vary due to a variety offactors. For the assumptions used as the basis for the earnings forecasts and precautions regarding the use of the earnings forecasts,
please refer to “1. Qualitative information on the financial results for the period under review (3)Consolidated financial
results forecast and other forward-looking information” on page 3 of this report.

Table of Contents of Attachments
1. Qualitative information on the financial results for the period under review

2(1) Operating results

2(2) Financial condition

3(3) Consolidated financial results forecast and other forward-looking information

3

2. Quarterly Consolidated Financial Statements and Notes

5(1) Quarterly Consolidated Balance Sheet

5(2) Quarterly Consolidated Statement of Income and Comprehensive Income

7

Quarterly Consolidated Statement of Income (For the nine months)

7

Quarterly Consolidated Statement of Comprehensive Income (For the nine months)

8(3) Notes to the quarterly consolidated financial statements

9(Notes on going concern assumption)

9(Notes in the event of significant amount changes in shareholders’ equity)

9(Accounting policies adopted specially for the preparation of quarterly consolidated financial statements)

9(Changes in accounting policies)

10(Additional information)

11(Segment information)

12(Significant subsequent events)

131

1. Qualitative information on the financial results for the period under review(1) Operating results
The world economy for the nine months ended December 31, 2021 continued to face severe circumstances.
The economy did not fully recover under the impact of the resurgence of COVID-19, limitations on supply
and other factors despite being on a recovery track owing mainly to the diffusion of COVID-19 vaccines andeconomic measures.
Amid such conditions, TOSHIBA TEC CORPORATION (the “Company”) and its subsidiaries(collectively, the “Group”) set forth the Basic Policy of the FY21-23 Mid-term Business Plan (MTBP),“After the structural reform and transformation, accelerate concentrated investment in the growth field tobecome a solutions partner by utilizing data effectively.” Under the basic policy, the Group has focused its
energy on carrying out various measures to develop its business. At the same time, as a solutions partner thathelps solve issues in the domains of stores, offices, logistics and manufacturing, the Group has promoted
initiatives to achieve the Sustainable Development Goals (SDGs) together with customers and strived tocontribute to realizing a sustainable society.
In the nine months ended December 31, 2021, the impact of the COVID-19 pandemic continued, and theGroup was affected by tight supply-demand balance and soaring prices in components and internationalcargo transportation. However, as economic activities showed more strength compared to the same period of
the previous fiscal year, net sales recovered to ¥328,525 million (up 12% year on year). Meanwhile, on the
profit front, the Group recorded operating profit of ¥8,664 million (up 171% year on year), ordinary profit of¥8,076 million (up 220% year on year), and profit attributable to owners of parent of ¥6,193 million (lossattributable to owners of parent of ¥3,374 million in the same period of the previous fiscal year).
Results of reportable segments for the nine months ended December 31, 2021 were as follows.
Retail Solutions Business GroupThe Retail Solutions Business Group handles POS systems for domestic and overseas markets, auto ID
systems for domestic market, and related products. Amid a severe business environment in which the impactof the spread of COVID-19 and intensifying competition with peers continue, the business group has worked
on various initiatives under the basic policy of “Aim at becoming a global top solutions partner in the
distribution industry.” These initiatives include concentrated investment in growth fields (data services, next
generation stores, payment, and Supply Chain Management (SCM)), business expansion through strategic
partnership, and the expansion of service business in overseas markets.
Sales of POS systems for domestic market rose as a result of efforts focused on expanding sales mainly of
payment terminals, self-ordering systems, smart receipts by taking into account measures against COVID-19,
amid a downturn in the investment appetite of retail and restaurant businesses.
Sales of POS systems for overseas markets increased as sales remained robust in each region.
Sales of auto ID systems for domestic market declined as sales of barcode printers fell due in part to tightsupply-demand balance of components.
As a result, net sales of the Retail Solutions Business Group was ¥197,086 million (up 9% year on year).
Operating profit of the business group was ¥8,245 million (down 8% year on year) due in part to the impactof tight supply-demand balance of components despite the increase in net sales.
Workplace Solutions Business Group
The Workplace Solutions Business Group handles multifunction peripherals (MFPs) for domestic andoverseas markets, auto ID systems for overseas markets, inkjet heads for domestic and overseas markets, andrelated products. Amid a severe business environment in which the impact of the spread of COVID-19 andintensifying competition with peers continue, the business group simultaneously reinforced “Customer touchpoints functions” and “Overall business structure,” and built a robust and streamlined global operation
structure to focus on achieving its targets. At the same time, the business group worked on strengthening
Document Management System (DMS)/Enterprise Contents Management (ECM) solutions, the auto ID
business, the cloud solutions platform, and other measures.
Sales of MFPs rose as a result of increased sales in the Americas, Europe, Asia and other overseas regions.

2Sales of auto ID systems for overseas markets increased as a result of increased sales in the Americas,
Europe, Asia and other overseas regions.
Sales of inkjet heads increased due to increased sales to domestic and overseas customers.
As a result, net sales in the Workplace Solutions Business Group was ¥134,291 million (up 17% year onyear). Operating profit for the business group improved to ¥419 million (operating loss of ¥5,759 million in
the same period of the previous fiscal year) due mainly to the increase in net sales despite being affected bytight supply-demand balance and soaring prices in components and international cargo transportation.
(Note) An auto ID system is a system that uses hardware and software devices to recognize and manage data
content by automatically scanning barcode and RFID tag data.
(2) Financial condition
Assets at the end of the third quarter of the fiscal year ending March 31, 2022 increased by ¥11,845
million from the end of the previous fiscal year to ¥301,158 million. This was mainly because merchandiseand finished goods as well as raw materials and supplies increased by ¥6,288 million and ¥4,923 million,
respectively, although “Other” in current assets declined by ¥1,290 million.
Liabilities increased by ¥7,258 million from the end of the previous fiscal year to ¥186,708 million. Thiswas mainly because notes and accounts payable – trade increased by ¥12,357 million, although “Other” incurrent liabilities declined by ¥4,712 million.
Net assets rose by ¥4,587 million from the end of the previous fiscal year to ¥114,450 million. This wasprimarily due to an increase in retained earnings of ¥6,193 million owing to the recording of profit
attributable to owners of parent, a decrease of ¥2,200 million due to payment of dividends, and a decrease in
non-controlling interests of ¥1,028 million.
(3) Consolidated financial results forecast and other forward-looking information
The Company revised its consolidated financial results forecast for the fiscal year ending March 31,
2022 announced on November 8, 2021 as follows.
Revision to consolidated financial results forecasts for the fiscal year ending March 31, 2022
(Million yen)
Net sales

Operating profit

Ordinary profit

Profit attributableto owners ofparentBasic earnings per
share (Yen)Previously announced
forecast (A)440,000

15,00012,0007,000

127.22

Revised forecast (B)445,000

15,00012,0008,000

145.38Change (B)-(A)

5,000

－

－

1,000

－

Change (%)

1.1

－

－

14.3

－

405,694

8,263

7,193

7,126

129.55

Reference: results of theprevious fiscal year (ended
March 31, 2021)

Revision to consolidated sales forecasts by segment for the fiscal year ending March 31, 2022
(Million yen)
Reference: resultsof the previous
fiscal year (ended
March 31, 2021)

Previously
announced
forecast (A)Revised forecast(B)

Change (B)-(A)Retail Solutions

270,000

267,000(3,000)(1.1)

248,470

Workplace Solutions

175,000

183,000

8,000

4.6

158,925

Eliminations(5,000)(5,000)－－(1,701)

Net sales

440,000

445,000

5,000

1.1

405,694

Change (%)(Note) Figures for the fiscal year ended March 31, 2021 shown above have been reclassified into new segmentcategories effective from the fiscal year ending March 31, 2022.

3

Revision to consolidated operating profit forecasts by segment for the fiscal year ending March 31, 2022
(Million yen)Previously
announced
forecast (A)Retail Solutions
Workplace Solutions
Operating profit

Reference: resultsof the previous
fiscal year (ended
March 31, 2021)

Revised forecast(B)

Change (B)-(A)15,00012,500(2,500)(16.7)

13,741

0

2,500

2,500

－

(5,477)

15,00015,000

－

－

8,263

Change (%)(Note) Figures for the fiscal year ended March 31, 2021 shown above have been reclassified into new segmentcategories effective from the fiscal year ending March 31, 2022.
Net sales of the Retail Solutions Business Group have been revised downward due mainly to the impact of
the tight supply-demand balance of components in domestic market being more expanded than expected andthe rapid spread of the new variant of COVID-19 (the Omicron variant) infection since January 2022, that
economic activity may be greatly limited again. On the other hand, net sales of the Workplace Solutions
Business Group have been revised upward due to factors including the sales of MFPs and other products
remaining stronger than expected and the weakening of the Japanese yen. As a result, net sales of the Group
were revised upward as stated above.
Primarily in line with the revisions to net sales, operating profit of the Retail Solutions Business Group has
been revised downward. On the other hand, operating profit of the Workplace Solutions Business Group has
been revised upward. As a result, operating profit of the Group has been left unchanged from the previously
announced forecast. Profit attributable to owners of parent has been revised upward as stated above as it
trended higher than expected as a result of factors including the recording of gain on sale of investment
securities in extraordinary income due to the sale of strategic shareholdings in the nine months ended
December 31, 2021.
The reference exchange rates used in the consolidated financial results forecast for the fiscal year ending
March 31, 2022 are ¥111.96 to the US dollar and ¥130.22 to the euro.
*Financial results forecasts are based on information currently available to the Company and certain
assumptions deemed reasonable, and are not intended to be the Company’s guarantee that they will beachieved. Actual results may significantly vary due to a variety of factors.

4

2. Quarterly Consolidated Financial Statements and Notes(1) Quarterly Consolidated Balance Sheet(Million yen)
As of March 31,2021

As of December 31,2021

AssetsCurrent assets
Cash and deposits
Group deposits paid

42,17910,064

46,343
8,186

Notes and accounts receivable - trade
Notes and accounts receivable - trade, and contract
assetsMerchandise and finished goods
Work in process

63,928--64,464

31,582
4,376

37,8706,003

Raw materials and supplies
Other

6,944
24,115

11,867
22,825

Allowance for doubtful accounts(1,394)(1,402)

Total current assets

181,797

196,159

45,16842,544

Goodwill
Other

1,633
9,876

1,133
9,364

Total intangible assets

11,51010,498

Other
Allowance for doubtful accounts

50,929(91)

52,044(88)

Total investments and other assets

50,83751,955

107,516

104,999

289,313301,158

Non-current assets
Property, plant and equipment
Intangible assets

Investments and other assets

Total non-current assets
Total assets

5

(Million yen)
As of March 31,2021

As of December 31,2021

Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term borrowings

48,509542

60,866742

Income taxes payable
Other

1,375
74,9183,106
70,206

Total current liabilities

125,346

134,921

Non-current liabilities
Long-term borrowings

1,019

1,019

Retirement benefit liability
Other

26,624
26,46025,18025,586

Total non-current liabilities

54,10451,787

179,450

186,708

Shareholders' equity
Share capital

39,97039,970Capital surplus
Retained earnings

57
52,616

107
56,788Treasury shares(5,372)(5,336)

Total shareholders' equity

Total liabilities
Net assets

87,27391,531

Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges

1,681

1,579

(16)

7

Foreign currency translation adjustment
Minimum pension liability adjustments

10,805(832)

12,505(840)

Remeasurements of defined benefit plans

3,799

3,552

Total accumulated other comprehensive income

15,436

16,804

Share acquisition rights

57

48

Non-controlling interests

7,094

6,066

109,862

114,450

289,313301,158

Total net assets
Total liabilities and net assets

6

(2) Quarterly Consolidated Statement of Income and Comprehensive Income
Quarterly Consolidated Statement of Income (For the nine months)(Million yen)
For the nine months
ended December 31,2020

For the nine months
ended December 31,2021

Net sales
Cost of sales

293,927
177,614

328,525
196,648

Gross profit

116,313

131,877

Selling, general and administrative expenses

113,115

123,212

3,197

8,664

Operating profit
Non-operating income
Interest income

201

290

Dividend income
Gain on valuation of derivatives

43
-

44
468

Foreign exchange gains
Other

739
382

274

1,366

1,077

406

347

288
-

458

Total non-operating income
Non-operating expenses
Interest expenses
Loss on valuation of derivatives
Foreign exchange losses
Other

1,348

859

Total non-operating expenses

2,043

1,665

Ordinary profit

2,521

8,076

Extraordinary income
Gain on sale of investment securities-

223

Reversal of environmental expenses

284-

Total extraordinary income

284

223

-

1

Restructuring cost

7,203

867

Total extraordinary losses

7,203

869

Profit (loss) before income taxes

Extraordinary losses
Loss on sale of investment securities(4,397)

7,430

Income taxes

595

2,428

Profit (loss)(4,993)

5,002

Loss attributable to non-controlling interests(1,618)(1,191)

Profit (loss) attributable to owners of parent(3,374)

6,193

7

Quarterly Consolidated Statement of Comprehensive Income (For the nine months)(Million yen)
For the nine months
ended December 31,2020
Profit (loss)
Other comprehensive income

For the nine months
ended December 31,2021(4,993)

5,002

Valuation difference on available-for-sale securities
Deferred gains or losses on hedges

168
(5)

(102)
24

Foreign currency translation adjustment
Minimum pension liability adjustment

(455)
(138)

1,940
(8)

Remeasurements of defined benefit plans, net of tax

259

(246)

(171)

1,608

Comprehensive income

Total other comprehensive income(5,164)

6,610

Comprehensive income attributable to
Owners of parent(3,373)7,560(1,791)(949)

Non-controlling interests8(3) Notes to the quarterly consolidated financial statements
Notes on going concern assumption
Not applicable
Notes in the event of significant amount changes in shareholders’ equity
Not applicable
Accounting policies adopted specially for the preparation of quarterly consolidated financial statements
Calculation of tax expenses
Tax expenses are calculated by reasonably estimating the effective tax rate after the application of tax effectaccounting for profit before income taxes for the consolidated fiscal year including the third quarter underreview and multiplying profit before income taxes by the estimated effective tax rate.
Provided, however, that if calculation using the estimated effective tax rate turns out to be significantly
unreasonable, calculations are made pursuant to Paragraph 15 (Method of using the statutory effective taxrate) of the Implementation Guidance on Tax Effect Accounting for Interim Financial Statements(Accounting Standards Board of Japan (ASBJ) Guidance No. 29, February 16, 2018), according to theprovisions of Paragraph 19 of the Implementation Guidance on Accounting Standard for Quarterly Financial
Reporting (ASBJ Guidance No. 14, March 31, 2020).
Income taxes – deferred are included in income taxes.

9Changes in accounting policies
Application of Accounting Standard for Revenue Recognition, etc.
The Company has applied the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29,
March 31, 2020; hereinafter, the “Revenue Recognition Standard”) and other standards from the beginningof the first quarter of the fiscal year ending March 31, 2022. Under the standard, the Company recognizes
revenue when control over promised goods or services are transferred to customers at an amount expected tobe received in exchange for the goods or services.
Major changes resulting from the application of the Revenue Recognition Standard, etc. are as follows: For contracts for commissioned software, etc. specified by the customer, to which the completed
contract method was previously applied, we have changed to a new method regarding the contracts
for which performance obligations are fulfilled over a certain period of time. Under the new
method, we estimate the progress status of fulfilment of performance obligations and recognize
revenue over a certain period of time based on the progress status.
Regarding some of the transactions of consumables and transactions with the Company’s agents,
for which revenue was previously recognized at the time of shipment, we have changed to a new
method. Under the new method, we recognize revenue when control over merchandise andfinished goods are transferred, or primarily at the point of the delivery of merchandise and finishedgoods.

While we previously applied the method of processing sales rebates and other types ofconsideration paid to the Company’s agents or customers as selling, general and administrative
expenses, we have changed to a new method to deduct the amount from net sales.
The Company applies the Revenue Recognition Standard, etc. in accordance with the transitional
treatment stipulated in the proviso of Paragraph 84 of the Revenue Recognition Standard, etc. The
cumulative impact of retrospectively applying the new accounting policy before the beginning of the firstquarter of the fiscal year ending March 31, 2022 has been added to or subtracted from retained earnings at
the beginning of the said first quarter, and the new accounting policy is applied from the balance at the
beginning of the said period.
As a result, retained earnings at the beginning of the period increased by ¥179 million by reflecting the
cumulative impact in net assets at the beginning of the first quarter of the fiscal year ending March 31, 2022.
Compared to the previous method, for the nine months ended December 31, 2021, net sales and cost of
sales increased by ¥400 million and ¥818 million, respectively, while selling, general and administrative
expenses decreased by ¥251 million. Operating profit, ordinary profit and profit before income taxes
decreased by ¥166 million, respectively.
Due to the application of the Revenue Recognition Standard, etc., notes and accounts receivable – trade,which had been presented under current assets in the consolidated balance sheet for the previous fiscal year,
are included in notes and accounts receivable - trade, and contract assets from the first quarter of the fiscal
year ending March 31, 2022.
In line with the transitional treatment provided in Paragraph 89-2 of the Revenue Recognition Standard,
figures for the previous consolidated fiscal year have not been reclassified by the new presentation method.
Application of Accounting Standard for Fair Value Measurement, etc.
The Company has applied the Accounting Standard for Fair Value Measurement (ASBJ Statement No. 30,
July 4, 2019; hereinafter, the “Fair Value Measurement Standard”) and other standards from the beginning of
the first quarter of the fiscal year ending March 31, 2022. In line with the transitional treatment stipulated in
Paragraph 19 of the Fair Value Measurement Standard and Paragraph 44-2 of the Accounting Standard for
Financial Instruments (ASBJ Statement No. 10, July 4, 2019), the Company will apply the new accounting
policy provided by the Fair Value Measurement Standard, etc. prospectively. This does not affect thequarterly consolidated financial statements.

10Additional information
Treatment of Tax Effect Accounting for the Transition from the Consolidated Taxation System to theGroup Tax Sharing System
Regarding the transition to the group tax sharing system provided for in Act for Partial Amendment to the
Income Tax Act, etc. (Act No. 8 of 2020), and items for which the non-consolidated taxation system has beenreviewed in line with the transition to the group tax sharing system, the Company and some of its domestic
consolidated subsidiaries have calculated the amounts of deferred tax assets and deferred tax liabilities inaccordance with the provisions of tax laws prior to the amendments, based on the treatments stipulated in
Paragraph 3 of the Practical Solution on the Treatment of Tax Effect Accounting for the Transition from theConsolidated Taxation System to the Group Tax Sharing System (ASBJ Practical Issues Task Force No. 39,
March 31, 2020), instead of applying the provision of Paragraph 44 of Implementation Guidance on Tax
Effect Accounting (ASBJ Guidance No. 28, February 16, 2018).

11

Segment information
I Nine months ended December 31, 2020
Amounts of net sales, profit or loss by reportable segment(Million yen)
Reportable segments
Adjustment

Consolidated
amount(Note)

Retail Solutions

Workplace
Solutions180,797

113,129

293,927

－

58

1,175

1,234

(1,234)

293,927－

Total

180,856

114,305

295,161(1,234)

293,927

Segment profit (loss)

8,956(5,759)

3,197

－

3,197

Total

Net sales
Sales to external customers
Intersegment sales and transfers(Note) Segment profit (loss) corresponds with operating profit in the quarterly consolidated statement of income.

Ⅱ Nine months ended December 31, 2021
1. Amounts of net sales, profit or loss by reportable segment(Million yen)
Reportable segments
Retail Solutions

Workplace
Solutions

Adjustment
Total

Consolidated
amount(Note)Net sales
Sales to external customers
Intersegment sales and transfers
Total
Segment profit

197,025

131,499

328,525

－

60

2,791

2,851

(2,851)

328,525－

197,086

134,291

331,377(2,851)

328,525

8,245

419

8,664

－

8,664

(Note) Segment profit corresponds with operating profit in the quarterly consolidated statement of income.

2. Changes in reportable segment, etc.
Changes in reportable segment categories
From the first quarter of the fiscal year ending March 31, 2022, the Company has renamed the Printing
Solutions Business Group as the Workplace Solutions Business Group. The MFP business for the Japanesemarket formerly included in the Retail Solutions Business Group has been transferred to the Workplace
Solutions Business Group.
Segment information for the nine months ended December 31, 2020 disclosed above have been preparedbased on the reportable segment categories for the nine months ended December 31, 2021.
Application of Accounting Standard for Revenue Recognition, etc.
As stated in “Changes in accounting policies” above, the Company has applied the Revenue Recognition
Standard, etc. from the beginning of the first quarter of the fiscal year ending March 31, 2022 and changed
the accounting method of revenue recognition. Accordingly, the method of calculating profit or loss byreportable segment has been changed in the same manner.
Due to the change, compared to the previous method, net sales of the Retail Solutions Business Group forthe nine months ended December 31, 2021 increased by ¥284 million and its segment profit decreased by¥176 million, while net sales of the Workplace Solutions Business Group increased by ¥115 million and its
segment profit increased by ¥10 million.
*Supplementary information
Average exchange rate
(Yen to the US dollar)
Average exchange rate
(Yen to the euro)

Nine months ended December 31,2020

Nine months ended December 31,2021

106.13110.97

121.79130.8712

Significant subsequent events
Capital and business alliance and disposal of treasury shares through third-party allotment
The Company resolved at its Board of Directors meeting held on December 23, 2021 to conclude a
capital and business alliance agreement (hereinafter referred to as the “Agreement” and the capital andbusiness alliance based on the Agreement is referred to as the “Alliance”) with Digital Garage, Inc.
(hereinafter, “Digital Garage”), and signed the Agreement on December 23, 2021.
In addition, the Company also resolved at the same Board of Directors meeting to dispose of its treasury
shares through third-party allotment with Digital Garage as the allottee (the “Disposal”), as stated in “2.
Disposal of treasury shares through third-party allotment” below based on the Agreement.
The payment of funds for the Disposal has been completed on January 11, 2022.
1. Capital and business alliance(1) The background and objectives of the Alliance
There is a growing demand for new values achieving the improvements of both consumers’
convenience and distributors’ productivity in the retail market, the target of the Company’s Retail
Solutions Business Group, where significant business environmental changes are taking place. Under
such circumstance, the Company is aiming to become a global top solutions partner, who is capable ofsolving customer issues with data utilization and providing values both inside and outside Japan bylooking at the issues through the eyes of customers. In addition, the Company is striving to provide new
solutions in collaboration with its customers and partners with the aim of realization of efficient business
operation through Digital Transformation (DX) by defining “Data service” focusing on purchase data,“Next generation stores” (Note), “Payment” contributing to cashless society and “SCM”as 4 focusedbusiness domains.
(Note) The “Next generation stores” domain refers to solutions and technology domains relating to thenext-generation retail stores that improve productivity and achieve a frictionless customer
experience, such as unmanned payment stores, for instance.
As for the data service and payment areas, we believe that it is important for us to enhance payment
services by utilizing FinTech to increase our competitive advantages and also to realize effective
advertising appealing to each consumer by connecting purchase data which retailers possess with SNS
through expansion of digital marketing which uses various digital technology, such as purchase data andSNS.
As one of Japan’s largest payment system providers handling over 3 trillion yen in annual paymenttransaction, Digital Garage provides a diversity of comprehensive payment platforms in its Financial
Technology (FT) segment and aims to expand the amount of transaction by supporting payment to its
investee companies and accelerating assistance of advertising, DX and CRM to its merchants under the
new group strategy of “DG FinTech Shift” to integrate payments and data. Digital Garage has a strength
in developing digital marketing strategy in the Marketing Technology (MT) segment by offering
seamless marketing solutions throughout the digital and the real world by promoting comprehensive
digital marketing designed to merge digital and real and conducting digital marketing businesses withvarious data utilization. The business development of Digital Garage aiming to integrate payments anddata has high affinity with the Company’s policy as mentioned above such as enhancement of its digitalmarketing domain. In the payment service domain, in December 2018 the Company already established
TD Payment Corporation (TDP), a joint venture with DG Financial Technology (formerly VeriTrans),
which is a subsidiary of Digital Garage. Since its establishment, TDP has been marketing and offering
new multiple payment solutions for POS systems by utilizing FinTech.
For the Company to drive the aforementioned policy in the Retail Solutions Business Group, theCompany needs to further accelerate the business alliance with Digital Garage by deploying more
concrete initiatives. We believe that mutual exploitation of management resources, such as technologies
and human resources engaging in the payment business and digital marketing domain, is very useful andwe can increase corporate values by doing so. We have also come to the conclusion that we need to
execute a capital tie-up to ensure the development and strengthening of long term cooperative
relationship between the two companies. Accordingly, the Company concluded the Agreement with
Digital Garage to push forward with the business alliance with Digital Garage, and decided to acquire13the shares of Digital Garage through the disposal of treasury stock by third-party allotment conducted byDigital Garage with the Company as its allottee, and the Company also decided to dispose of its treasury
shares by third-party allotment with Digital Garage as its allottee.
(2) The details of the capital alliance(a) The Company allotted Digital Garage 295,000 shares of its common stock (or 0.51% of the total
number of its shares issued; rounded to the second decimal places; hereinafter the same applies toshareholding ratios) through the Disposal.
(b) Digital Garage also acquired the Company’s shares separately from the above.
(c) Meanwhile, the Company subscribed for 949,500 shares of common stock of Digital Garage (or2.00% of the total number of its shares issued) through the disposal of treasury shares by third-party
allotment.
(d) The total amount of (a) the Disposal and (b) share acquisition by Digital Garage is nearly equivalentto (c) the total amount of disposal of treasury shares by Digital Garage.
(3) The details of the business alliance
In line with the purpose stated in “(1) The background and objectives of the Alliance” above,
the Company and Digital Garage engage in a business alliance as follows.
(a) Payment business(i) Strengthen and expand payment services operated through TDP and other channels by
integrating the payment services of Toshiba Tec and DG Financial Technology, Inc. through its
optimization and efficiency.
(ii) Develop further collaboration in the payment service area by enhancing payment methods andstrengthening sales channel and sales structure.
(iii) Establish more stable operation of payment center by working out the best cooperative
framework and structure, in light of optimal resource allocation.
(b) Digital marketing service(i) Promote digital marketing service jointly in the retail business domain.
(ii) Promote comprehensive digital marketing, such as big data utilization including huge amountof payment data mentioned in the above item (a), development of sales promotion platforms
and CRM, to be targeted for the retail media, such as cart POS, smartphone POS and digital
signage, which Toshiba Tec is offering.
(4) The outline of the counterparty of the capital and business alliance
(i)

Name

Digital Garage, Inc.

(ii)

Location

3-5-7 Ebisu Minami, Shibuya-ku, Tokyo(iii)

Title and name ofrepresentative

Kaoru Hayashi, President Executive Officer and Group CEO
Main businesses of the Digital Garage group (Digital Garage and its subsidiaries andassociates):(iv)

Business line(v)

CapitalFinancial Technology Segment
Marketing Technology Segment
Incubation Technology Segment
Long-term Incubation Segment¥7,675 million (as of September 30, 2021)

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2. Disposal of treasury shares through third-party allotment(1) The outline of the disposal(i)

Deadline for disposal

January 11, 2022

(ii)

Number of shares for disposal

295,000 shares of common stock(iii)

Amount of disposal¥4,585 per share(iv)

Funds to be procured¥1,352,575,000(v)

Method of disposal

Third-party allotment(vi)

Counterparty

Digital Garage, Inc.

(2) The background and objectives of the disposal
As stated in “1. Capital and business alliance, (1) The background and objectives of the Alliance” above,
the Disposal is conducted as part of the Alliance. The Disposal is considered to ensure the development
and strengthening of long term cooperative relationship between the two companies. In addition, theCompany believes that the development and strengthening of a cooperative relationship with Digital
Garage will be conducive to improving the Company’s corporate value over the medium to long term as
well as to enhancing the interest of existing shareholders.
(3) Funds to be procured, their use and schedule of payment
1) Funds to be procured(i)

Total payment amount¥1,352,575,000(ii)

Estimated issuance cost

¥5,000,000(iii)

Difference (estimated funds acquired)¥1,347,575,000(Notes) 1. The total payment amount, estimated issuance cost and difference (estimated funds acquired) are
derived from the Disposal. The estimated issuance cost mainly consists of advisory fees andexpenses for preparing documents including the securities registration statement.
2. The estimated issuance cost does not include consumption taxes.
2) Specific use of funds to be procured
Funding through the Disposal is conducted as part of the Alliance. The funds procured will be used torealize the early achievement of synergy effect from the Alliance with Digital Garage, and are planned to
be allocated to various measures related to (i) payment service and (ii) digital marketing service in the
period from April 2022 through March 2027 as listed in the chart below. Meanwhile, the Company usedfunds on hand instead of the funds procured to acquire shares in Digital Garage.
Specific use

Amount(ⅰ) Sales expense and system development cost for
payment service(ⅱ) Sales expense and system development cost for
digital marketing service
Total

Payment schedule¥1.1 billion

April 2022 through March 2027

¥0.2 billion

April 2022 through March 2027

¥1.3 billion(ⅰ) Consists of expenses on sales of payment services including credit card payment, code-scanningpayment, e-commerce payment, as well as system development cost.
(ⅱ) Consists of expenses on the operation and sales of touch point applications and devices (various media
including cloud-based discount coupon distribution service, shopping apps, POS systems using shopping
carts and smartphones, and signage) that serve as customer contact points in digital marketing thatharnesses purchase data, social media, etc., as well as related system development cost.

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