Fuji Electric Report Financials

2023

Contents
Consolidated Financial Highlights....................................................02
Management’s Discussion and Analysis..........................................03
Consolidated Balance Sheets..........................................................11
Consolidated Statements of Income................................................13
Consolidated Statements of Comprehensive Income.......................14
Consolidated Statements of Changes in Net Assets........................15
Consolidated Statements of Cash Flows.........................................16
Notes to the Consolidated Financial Statements..............................17
Independent Auditor’s Report..........................................................45

01

Fuji Electric Report Financials 2023

Consolidated Financial Highlights
Thousands of
U.S. dollars*1

Millions of yen

Years ended March 31

2019

2020

2021

2022*82023*82023*8Operating Results
Net sales
Japan
Overseas
Operating profit
Profit Attributable to Owners of Parent¥ 914,915
682,503
232,41259,97240,267¥ 900,604
679,719
220,885
42,51528,793¥ 875,927
654,020
221,907
48,59541,926¥ 910,226
655,821
254,405
74,83558,660¥ 1,009,447
717,390
292,057
88,882
61,348$ 7,589,829
5,393,910
2,195,918
668,287
461,265

R&D and Capital Investment
R&D expenditures
Plant and equipment investment*2
Depreciation and amortization*3¥ 33,669
43,33830,906¥ 34,457
48,20832,319¥ 33,562
35,89036,194¥33,75659,32039,969¥36,216
84,14745,938$272,304
632,690
345,401

Cash Flows
Cash flows from operating activities
Cash flows from investing activities
Free cash flow
Cash flows from financing activities¥ 54,949(21,448)
33,501(38,172)¥ 46,087(27,621)
18,466
16,918¥ 26,931
23,47750,408(39,518)¥

76,809(22,350)
54,458(42,894)¥ 116,163(49,498)
66,665(77,192)$

873,412(372,171)
501,241(580,401)

Financial Position
Total assets
Total net assets
EquityNet interest-bearing debt
Interest-bearing debt

¥ 952,659
392,061
352,922
124,850
153,985¥ 996,827
406,002
365,620
153,617217,364¥1,051,952
461,254
416,997
140,872
216,205¥ 1,117,112
523,729472,900
117,041
208,391¥ 1,181,552
572,068
517,092
99,107183,273$ 8,883,850
4,301,267
3,887,907
745,171
1,377,994

6.6
25.4
11.8
4.3
37.0
0.4
0.4

4.7
24.5
8.0
3.0
36.7
0.4
0.6

5.5
25.3
10.7
4.1
39.6
0.3
0.5

8.2
27.9
13.2
5.4
42.3
0.2
0.4

8.8
28.9
12.4
5.3
43.8
0.2
0.4

—
—
—
—
—
—
—

¥ 281.89
2,470.65
80.00
28.4

¥ 201.57
2,559.60
80.00
39.70

¥ 293.52
2,919.34
85.00
29.00

27,416
17,647
9,769

27,96017,681
10,27927,593
17,647
9,946

26,757
17,493
9,264

27,123
17,392
9,731

—
—
—

89.0

72.1

134.1

179.7

156.4

—

(95.0)
4,760
(942)
2,982
(697)

(85.9)(122.1)(124.6)(131.8)

—

3,950

4,860

6,500

6,390

—

1,960

2,197

4,370

4,870

—

Financial Indicators
Ratio of operating profit to net sales (%)
Ratio of overseas sales to net sales (%)
ROE (Return on equity) (%)
ROA (Return on assets) (%)
Equity ratio (%)
Net debt-equity ratio (times)*4
Debt-equity ratio (times)*5
Per Share Data *6
ProfitNet assets
Cash dividends
Dividend payout ratio (%)
OthersEmployees
Japan
Overseas
Total shareholder return (%)(Comparative indicator:
TOPIX including dividends)
Highest stock price (Yen)*7
Lowest stock price (Yen)*7

Yen

U.S. dollars*1¥

410.683,310.80
100.0024.30¥

429.503,620.23
115.00
26.80

$

3.229
27.220
0.865
—

*1 T
 he U.S. dollar amounts represent the arithmetic results of translating yen into dollars at ¥133 = U.S. $1, the approximate exchange rate at March 31, 2023.
*2 P lant and equipment investment is the total of investment in tangible fixed assets, including acquisition amounts for lease contracts.
*3 Depreciation and amortization expense is the total of the depreciation of tangible fixed assets and amortization of intangible assets.
*4 N
 et debt-equity ratio is the ratio of net interest-bearing debt (interest-bearing debt + lease obligations – cash and cash equivalents) to equity.
*5 D ebt-equity ratio is the ratio of interest-bearing debt to equity.
*6 Effective October 1, 2018, the Company conducted an 1-for-5 common stock consolidation. Amounts for profit per share and net assets per share have been calculated assumingthat the stock consolidation took place on April 1, 2018. The amount of dividend ¥48 per share for the year ended March 31, 2019 is total of the interim dividend of ¥8 per share andthe year-end dividend of ¥40 per share. Since the Company conducted an 1-for-5 common stock consolidation effective October 1, 2018, the interim dividend of ¥8 does not reflect
stock consolidation effect and the annual dividend of ¥40 reflects stock consolidation effect. If the stock consolidation effect is also considered to the interim dividend per share, theinterim dividend of ¥8 per share without the effect is equivalent to ¥40 per share with the stock consolidation effect. Accordingly, the annual dividend for fiscal 2018 amounted to ¥80
per share, including adjusted interim dividend of ¥40 per share and year-end dividend ¥40 per share.
*7 The highest and lowest stock prices are on the Tokyo Stock Exchange (First Section). The Company conducted an 1-for-5 common stock consolidation effective October 1, 2018. The
stock price in fiscal 2018 is the highest and lowest stock price after the stock consolidation and the highest and lowest stock prices before the stock consolidation are in parentheses.
*8 From the beginning of the fiscal year ending March 31, 2022, the company applied the “Accounting Standard for Revenue Recognition” (Accounting Standard Board of Japan (“ASBJ”)
statement No. 29 issued on March 31, 2020),etc. The figures for the current fiscal year in the “Consolidated Financial Highlights” reflect the application of the accounting standards.

Fuji Electric Report Financials 2023

02

Management’s Discussion and Analysis
Overview

Financial Performance
Net Sales
Net sales in fiscal 2022 increased by 10.9%, to ¥1,009,447 million.
In all of the segments, Power Electronics Energy, PowerElectronics Industry, Semiconductors, Power Generation
segments, and Food and Beverage Distribution segments,
net sales increased. Domestic sales increased by 9.4%, to¥717,390 million. Overseas sales increased by 14.8%, to¥292,057 million.
The ratio of overseas sales increased by 1.0 percentage
points, to 28.9%.

In fiscal 2022, which we identified as an important year
for achieving the Medium-Term Management Plan “Reiwa
Prosperity 2023” (net sales of ¥1 trillion and an operating
margin of 8.0% or higher in fiscal 2023), Fuji Electric pursued
the following three strategies: promote growth strategies
centered on the power electronics systems and power
semiconductors; further improve profitability by augmenting
our global manufacturing capabilities; and continuously
reinforce our operating foundation focused on ESG(environment, human resources, and governance).
In fiscal 2022, the market environment surrounding theCompany was characterized by continued strong capital
investment in manufacturing, data centers, and other facilities
due to the continued increase in demand for electrified
vehicles (xEV), energy saving, and digital infrastructure amidst
global carbon neutrality initiatives and the acceleration ofdigitalization. In China, on the other hand, capital investment
remained sluggish due to the impact of COVID-19 and otherfactors. In addition, the outlook for the global supply chain
continued to be uncertain due to factors such as soaring
energy and raw material prices, material shortages, and rapid
exchange rate fluctuations.

Net Sales /Ratio of Overseas Sales to Net Sales(Billions of yen)

Operating Profit /Ratio of Operating Profit to Net Sales(%)

1,200.0

Cost of Sales, Selling, General and
Administrative Expenses and Operating Profit
Cost of sales increased by 11.4 percentage points, to¥732,529 million. The ratio of cost of sales to net sales
increased by 0.3 percentage points, to 72.6%.
Selling, general and administrative expenses increased
by 5.9%, to ¥188,036 million. The ratio of selling, generaland administrative expenses to net sales decreased by 0.9
percentage point, to 18.6%.
Operating profit increased by ¥14,047 million, to ¥88,882
million, primarily due to higher sales and production volumes,
increase in product sales price, strengthening cost reduction
and impact from foreign exchange rate fluctuations, while
being affected by soaring material prices and power cost. The
operating margin increased by 0.6 percentage points, to 8.8%.

40(Billions of yen)

(%)

100.0

88.9

1,009.4
900.0

914.9 900.6
875.9
25.4

24.5

25.3

910.2
27.9

Profit Attributable to Owners of Parent /Ratio of Profit Attributable to Owners of
Parent to Net Sales

12(Billions of yen)
75.0

28.9

30

75.0

60.0
20

58.7

50.0

6.6

42.5

48.6

8.2

8.8

50.0

6

4.7
300.0

20/3

21/3

22/3

23/3

Net Sales (left)
Ratio of Overseas Sales to Net Sales (right)

03

Fuji Electric Report Financials 2023

10

25.0

0

0

61.3

9

41.9

40.3
4.4

5.5

19/3

9

74.8

600.0

0

(%)

28.8

6.4

6.1

4.8

3.2

25.0

6

3

3

19/3

20/3

21/3

22/3

23/3

Operating Profit (left)
Ratio of Operating Profit to Net Sales (right)

0

0

19/3

20/3

21/3

22/3

23/3

Profit Attributable to Owners of Parent (left)
Ratio of Profit Attributable to Owners of
Parent to Net Sales (right)

0Non-Operating Income (Expenses) and
Ordinary Profit
Non-operating expenses (net) was ¥1,070 million, a ¥5,532
million increase from ¥4,462 million of non-operating incomein the previous fiscal year. This increase was primarily due toa ¥1,148 million foreign exchange loss, which ¥1,288 million
foreign exchange gain turned into, and an increase in businessconversion expenses by ¥1,599 million. As a result, ordinary
profit increased by ¥8,514 million, to ¥87,811 million.
Extraordinary Income (Loss),Profit before Income Taxes
and Non-Controlling Interests
Extraordinary income was ¥11,153 million, included gain on
sales of noncurrent assets and gain on sales of investment
securities. This represented a ¥616 million increase due to anincrease in gain on sales of noncurrent assets.
Extraordinary loss was ¥3,218 million, included loss
on disposal of noncurrent assets, loss on devaluation of
investment securities, loss on sales of investment securities,
and provision for loss on liquidation of subsidiaries andassociates. This represented a ¥1,871 million increase due toan increase in loss on devaluation of investment securities andprovision for loss on liquidation of subsidiaries and associates.
ProfitProfit before income taxes increased by ¥7,259 million, to¥95,746 million. After deducting ¥27,112 million of income taxes(the net of income taxes-current and income taxes-deferred)and ¥7,286 million of profit attributable to non-controllinginterests, profit attributable to owners of parent increased by¥2,688 million, to ¥61,348 million.

Results by Business Segment
Power Electronics Energy
Net sales: ¥264,078 million (an increase of 14.3%)
Operating profit: ¥26,884 million (an increase of ¥5,667 million)
Net sales and operating profit increased primarily due tohigher demand for the facility / power source system businessand the ED&C components business.
• In the energy management business, net sales and operating
profit decreased primarily due to large-scale orders forindustrial substation in the previous fiscal year.
• In the facility / power source system business, net sales
and operating profit increased due to higher demand fordata centers in domestic and oversea and semiconductor
manufacturers.
• In the ED&C components business, net sales and operating
profit increased due to demand from domestic machine set
manufacturers and semiconductor manufacturers.
Orders received in fiscal 2022 (Power Electronics Energy
segment of Fuji Electric Co., Ltd., non-consolidated-basis)
totaled ¥156.8 billion.
Power Electronics Industry
Net sales: ¥353,449 million (an increase of 9.0%)
Operating profit: ¥24,882 million (an increase of ¥1,059 million)
Net sales increased primarily due to higher demand in theautomation business and the IT solutions business. Operating
profit increased primarily due to higher demand for IT solution
business, while soaring material prices and difficulty inprocuring materials.
• In the factory automation business net sales and operating
profit increased, while effect of the COVID-19 in China,
primarily due to higher demand in other area and impact
from foreign exchange rate fluctuations.

Net Sales by Segment

Operating Profit (Loss) by Segment(Billions of yen)(Billions of yen)

1,009.4

1,200.0910.2
1,000.0

59.8
95.3
87.3

OthersFood and Beverage Distribution

206.2

Semiconductors

353.4

Power Electronics Systems Industry

240.6

264.1

Power Electronics Systems Energy

-47.5

-56.7

Adjustments

54.7
90.8
78.6

800.0

100.0

Power Generation

178.8

88.9

74.8
2.8
3.0
3.1

80.0

3.7
4.4
3.6

OthersFood and Beverage Distribution
Power Generation

32.2

Semiconductors

24.9Power Electronics Systems Industry

26.9

Power Electronics Systems Energy-6.7

Adjustments

27.1

60.0

600.0

314.3

400.0

23.7

20.0

200.0

0

-200.0

40.0

22/3

23/3

21.4
0

-20.0

-6.3

22/3

23/3

Fuji Electric Report Financials 202304• In the social solutions business, net sales and operating
profit decreased primarily due to lower demand for vessel
and railcar.
• In the equipment construction business, net sales andoperating profit increased primarily due to higher demand forelectricity equipment constructions.
• In the IT solutions business, net sales and operating profit
increased due to higher demand for the academic sector
and the public sector.
Orders received in fiscal 2022 (Power Electronics Industry
segment of Fuji Electric Co., Ltd., non-consolidated-basis)
totaled ¥186.2 billion.
Semiconductors
Net sales: ¥206,228 million (an increase of 15.3%)
Operating profit: ¥32,186 million (an increase of ¥5,050 million)• In the semiconductors business, net sales increased
primarily due to higher demand for power semiconductors
for electric vehicles (xEV) and industrial fields and impact
from foreign exchange rate fluctuations, while withdrawing
from the magnetic disks business. Operating profit increased
due to maintaining high operations, while increasing thecosts related to the strengthen in production capacity for
power semiconductor and being affected by soaring material
prices and power cost.
Orders received in fiscal 2022 (Semiconductors segmentof Fuji Electric Co., Ltd., non-consolidated-basis) totaled¥174.1 billion.

Power Generation
Net sales: ¥87,336 million (an increase of 11.2%)
Operating profit: ¥3,550 million (an increase of ¥426 million)• In the power generation plant business, net sales andoperating profit increased primarily due to large-scale orders
for renewable energy and the favorable sales mix.
Orders received in fiscal 2022 (Power Generation
segment of Fuji Electric Co., Ltd., non-consolidated-basis)
totaled ¥73 billion.
Food and Beverage Distribution
Net sales: ¥95,257 million (an increase of 4.9%)
Operating profit: ¥4,350 million (an increase of ¥1,343 million)• In the vending machine business, net sales and operating
profit increased primarily due to higher demand in domestic
market and cost reduction, while there were impact fromprovision of allowance for doubtful accounts for Chinese
subsidiaries.
• In the store distribution business, net sales decreased due
to large-scale orders for currency handing equipment in theprevious fiscal year. However, operating profit increased
primarily due to cost reduction.
Orders received in fiscal 2022 (Food and Beverage
Distribution segment of Fuji Electric Co., Ltd., nonconsolidated-basis) totaled ¥89.7 billion.
Others
Net sales: ¥59,791 million (an increase of 9.3%)
Operating profit: ¥3,752 million (an increase of ¥913 million)

R&D Expenditures /Ratio of R&D Expenditures to Net Sales

Plant and Equipment Investment /Depreciation and Amortization

Total Net Assets / ROE(Billions of yen)(Billions of yen)(Billions of yen)

(%)

40.0

33.7

34.5

33.6

33.8

36.2

30.0

8

600.0

100.0

6

3.7

3.8

3.8

3.7

3.6

60.0

43.3

4

0

2

19/3

20/3

21/3

22/3

23/3

R&D Expenditures (left)
Ratio of R&D Expenditures to Net Sales (right)

05

Fuji Electric Report Financials 2023

0

48.2

30.9

35.9 36.2
32.3

40.0

400.0

45.9

30
300.0

200.0

11.8

8.0

10.7

13.2

12.4

20/3

21/3

Plant and Equipment Investment
Depreciation and Amortization

22/3

23/3

0

19/3

20/3

Total Net Assets (left)
ROE (right)

20

10

100.0

19/3

50

40

392.1 406.0

20.0

0

461.3

500.0

80.0

40.0
10.0

523.7

84.1

59.3
20.0

(%)

572.1

21/3

22/3

23/3

0

As an environmental investment to reduce greenhousegas emissions, we added a cogeneration system to our
Yamanashi Factory. We also developed production equipment
to reduce insulation gas, which has a high global warming
potential, introduced abatement devices, and adopted energysaving equipment. We are promoting efforts to achieve theEnvironmental Vision 2050 by upgrading facilities.

R&D Investment and Plant andEquipment Investment
R&D
Fuji Electric is engaged in many advanced systems suchas creations of energy, stable supplies, automation, andelectrification of mobility by utilizing core technologies suchas power semiconductors, power electronics, measuring andcontrol, and cooling.
The Company’s R&D expenditures in fiscal 2022 totaled¥36,216 million.
As of March 31, 2023, the number of our industrial property
rights registered in Japan and overseas was 13,178.

*Platform design: A design that standardizes major components for the purpose of
shortening the development period and reducing procurement and production costs.

Financial Position
Total Assets
As of March 31, 2023, total assets was ¥1,181,552 million, an
increase of ¥64,440 million.

Plant and Equipment Investment
In fiscal 2022, we made capital investments totaling ¥84,147
million, including leases, to increase the production capacity ofsemiconductors and to increase revenues in power electronics
systems. Major investments were as follows.
In the semiconductors business, in response to the growing
demand for electrified vehicles and renewable energy, we
made a major investment in Fuji Electric (Malaysia) Sdn. Bhd.
to increase production capacity for power semiconductor
chips, as well as investments at sites in Japan and overseas toincrease IGBT module production capacity.
In the power electronics systems business, with the aim of
expanding into the global market, we installed new production
facilities for platform-designed* inverters at the Suzuka
Factory and Fuji Electric India Private Ltd. Furthermore, Fuji
Electric India Private Ltd. is establishing a production system
for uninterruptible power supplies (UPS) for data centers andpower conditioners for solar power generation systems thatmeet the needs of local customers in an effort to improve
product competitiveness and expand earnings.

Total Assets / ROA(Billions of yen)
1,200.0

952.7

996.8

1,052.0

1,117.1

5.4

900.0

(%)
8

5.3

6

Equity Ratio

Interest-bearing Debt /Debt-equity Ratio(%)(Billions of yen)
50.0

40.0 37.0

36.7

39.6

42.3

43.8

(Times)

300.0

3

217.4

216.2 208.4

183.3

200.0

4.3
600.0

1,181.6

Current Assets and Current Liabilities
Total current assets was ¥713,553 million, an increase of¥31,572 million. This increase was primarily due to an increaseof ¥18,731 million in accounts receivable-trade, ¥11,935 million
in contract assets, ¥28,396 million in inventories.
Total current liabilities was ¥446,826 million, an increaseof ¥59,857 million. This increase was primarily due to anincrease of ¥29,844 million in trade payables, ¥15,000 million
in current portion of long-term borrowings and ¥10,006
million in contract liabilities.

4.1

30.0

2

154.0

4

3.0

20.0
100.0
300.0

0

2

19/3

20/3

Total Assets (left)
ROA (right)

21/3

22/3

23/3

0

0.4

10.0

0

1

19/3

20/3

21/3

22/3

23/3

0

19/3

0.6

20/3

0.5

21/3

0.4

0.4

22/3

23/3

0

Interest-bearing Debt (left)
Debt-equity Ratio (right)

Fuji Electric Report Financials 2023

06

Noncurrent Assets
Total noncurrent assets was ¥467,999 million, an increaseof ¥32,868 million. Net property, plant and equipment
was ¥283,912 million, an increase of ¥50,237 million. Total
investments and other assets was ¥184,087 million, adecrease of ¥17,369 million. This decrease was primarily due
to a decrease of ¥17,856 million in investment securities mainly
due to sales and decrease in valuation difference on availablefor-sale securities.
Long-term Liabilities
Total long-term liabilities was ¥162,658 million, a decreaseof ¥43,756 million. This decrease was primarily due to adecrease of ¥52,676 million in long-term debt.
Net Assets
As of March 31, 2023, net assets was ¥572,068 million,
an increase of ¥48,339 million. This increase was primarily
due to an increase of ¥45,637 million in retained earnings.
As a result, the equity ratio was 43.8%, an increase of 1.5
percentage points.
Debt
As of March 31, 2023, interest-bearing debt was ¥183,273
million, a decrease of ¥25,118 million. The ratio of interestbearing debt to total assets was 15.5%, a decrease of 3.2
percentage-points.

Cash Flows from Operating Activities
Net cash provided by operating activities was ¥116,163 million,
compared with ¥76,809 million in the previous fiscal year.
Major factors of cash decrease included an increase in tradereceivables, contract assets and inventories. Major factors of
the cash increase included profit before income taxes and anincrease in trade payables. Cash flows from operating activities
increased by ¥39,354 million.
Cash Flows from Investing Activities
Net cash used in investing activities was ¥49,498 million,
compared with net cash used by investing activities of ¥22,350
million in the previous fiscal year. This was primarily due topurchases of property, plant and equipment offset by salesof investment securities. Net cash used in investing activities
increased by¥27,148 million.
Cash Flows from Financing Activities
Net cash used in financing activities was ¥77,192 million,
compared with net cash used in financing activities of ¥42,894
million in the previous fiscal year. This was primarily due torepayments of long-term loans payable and repaymentsof lease obligations. Net cash used in financing activities
increased by ¥34,298 million.

Cash Flow
Consolidated free cash flow (net cash provided by (used in)operating activities + net cash provided by (used in) investing
activities) was a positive ¥66,665 million, a ¥12,207 million
increase from the previous fiscal year’s positive free cash flowof ¥54,458 million.

Cash Flows

Free Cash Flow /Cash and Cash Equivalents(Billions of yen)(Billions of yen)

150.0

116.2

100.0

91.4

120.0
90.0

76.8
54.9

60.0
30.0

60.0

0

-38.2

-27.6

-90.0
-120.040.0-22.4-39.5 -42.9

-49.5
-77.2

-60.0

19/3

20/3

21/3

22/3

23/3

Cash Flows from Operating Activities
Cash Flows from (Used in) Investing Activities
Cash Flows from (Used in) Financing Activities

07

66.7

63.7

26.9
23.5
16.9

-30.0 -21.4

75.3

80.0

46.1

Fuji Electric Report Financials 2023

50.4

54.5

33.5
29.1
18.5

20.0

0

84.2

19/3

20/3

21/3

Free Cash Flow
Cash and Cash Equivalents

22/3

23/3

Risk Factors
Fuji Electric manages business and other risks in acoordinated, systematic manner and takes appropriate
measures to minimize the impact of such risks. The following
factors were judged to have a potential future effect on Fuji
Electric’s business performance and financial position. Any
forward-looking statements in the following are based on the
judgment of management as of the date of submitting thesecurities report (June 27, 2023).
(1) M anagement Strategies, Business Strategies, andOperating Environment
Fuji Electric works to swiftly concentrate management
resources on businesses earmarked for growth while making
capital and R&D investments aimed at expanding anddeveloping its businesses. With respect to semiconductorrelated capital investments, which require large amountsof money, we make decisions based on negotiations
with customers regarding physical quantities and pricing.
Regarding R&D investments, we emphasize consistency withour business strategies and contribution to our businesses.
Based on our roadmap, we pursue R&D on fundamental andadvanced technologies that support Fuji Electric’s future. Here,the management engages in regular deliberations about key
development themes and constantly reviews the roadmap
according to market changes. However, the semiconductor
field is characterized by short product cycles, major
fluctuations in product supply/demand levels, and intensecompetition. In some cases, therefore, we may be unable
to recover our investment, which may affect its businessperformance and financial position.
Fuji Electric is contributing to realize a sustainable society
through our energy and environment related businesses,
considering protection of the global environment to be
an important management priority. Also, we promote ourEnvironmental Vision 2050, which aims to realize a low-carbon
society, recycling-oriented society, and a society in harmony
with nature, across the supply chain. Further, we announced
its support for the recommendations of the TCFD, Task
Force on Climate-related Financial Disclosures, and conduct
climate change risk analysis from a long-term perspective.
However, stricter enforcement of the Paris Agreement andother environmental regulations, as well as assessments by
ESG evaluation institutions may lead to stronger criticism ofpart of Fuji Electric’s operations (coal-fired power generation
business), which may affect its business performance andfinancial position.
Fuji Electric has business bases around the world andprovides products and services to markets and customers in
multiple regions. The spread of infectious diseases in many
countries has led to restrictions on economic activities.These
have had various effects on Fuji Electric’s business activities,
including restrictions on sales activities, factory operationsuspensions, and limitations on construction site visits.

If these restrictions are tightened, it could increase theimpact on Fuji Electric’s business activities, which may affectits business performance and financial position.
(2) Corporate GovernanceFuji Electric is working to strengthen its corporate governanceby improving management transparency and auditing
functions during normal times. However, an unprecedented
event may lead to deficiencies in our internal control andaudit functions, resulting in corporate governance breakdown
and business disruption, etc., which may affect our businessperformance and financial position.
(3) B usiness Reorganizations, Alliances, andWithdrawals
Fuji Electric actively engages in M&As, joint ventures, businessalliances, and the like with third parties in order to strengthen
its competitiveness in each business field. As part of these
activities, we share our corporate philosophy, management
policy, code of conduct, business plans, business strategies,
and so on to facilitate integration of our business strategies,
technologies, products, and human resources. Throughmanagement meetings and other forums, we strive tomaintain close communication with partners and build good
relationships with them. Due to differences in systems andcultures, however, we may be unable to achieve the desired
outcomes, which may affect our business performance andfinancial position.
(4) Orders, Marketing, and Sales Promotion
Fuji Electric is developing operations actively in overseas
markets, focusing particularly on expanding sales in China
and other Asian markets. We have sales offices in various
markets to better understand customer trends and centrally
manage the information we collects for analysis andconsideration and otherwise strive not to miss business
opportunities. We also work to reduce costs and expenses
in order to minimize the impact of domestic and overseas
trends on our business performance. However, any numberof events may affect our business performance and financial
position. These include deteriorating market conditions ineach country —including private capital investments andpublic expenditures— as well as sudden changes in supply
and demand of products, intensifying competition, and theresultant significant falls in prices.
Fuji Electric receives orders for large-scale plant projects
in the power electronics field and the power generation field,
etc. In order to secure appropriate profits in each project, wework to improve the accuracy of our quotations at the time oforder receipt and strengthen project management afterwards.
After receipt of orders, however, any number of events may
affect our business performance and financial position. These
include unanticipated specification changes, process delays,
and profitability declines due to natural disasters and the like.

Fuji Electric Report Financials 202308

(5) Development and Design Engineering
Fuji Electric has established an R&D system to accelerate
research and development and constantly monitors market,
customer needs and the latest technological trends. At
the same time, we conduct R&D aimed at creating strong
components and systems, focused on power electronics
and power semiconductor technologies, and R&D to develop
solutions that generate customer value through combinationsof elemental technologies.
Due to rapid technological advances, however, we may
lose our advantage over other companies, and productdevelopment may not proceed as planned, making it
impossible to launch new product at the right time. Any ofthese events may affect our business performance andfinancial position.
(6) Procurement
Fuji Electric deploys various means, including product swaps,
to reduce the risk of rising raw material prices. However, in
addition to increasing raw material and components prices
against the background of a weak yen, such changes as thedrastically increasing demand in emerging nations may resultin tightened supply and demand as regards materials andraw materials and significant increases in their prices. Anyof these events may affect our business performance andfinancial position.
(7) P roduction, Manufacturing, Shipping, Logistics,
Installation, Delivery, and Service
Fuji Electric always keeps track of the latest physical quantity
flows by sharing information between its sales and businessdepartments at management meetings and other forums. We
have also built an optimal production management system thatcan respond to changes in physical quantity flows by suchas improving productivity and promoting local production for
local consumption. However, an unprecedented event could
result in increased/decreased demand and other changes
in physical quantity flows, leading to delayed responses andinventory shortages/surpluses, which may affect our businessperformance and financial position.
Through reforms of its supply chain, Fuji Electric works topromote “completely localized” manufacturing through local
production for local consumption while also emphasizing
global procurement. However, an unprecedented event could
result in restrictions on human and commodity movements
and disruptions to our distribution network. This could
prevent our supply chain from functioning and cause delays
in deliveries, which may affect our business performance andfinancial position.

09

Fuji Electric Report Financials 2023

(8) Quality Assurance
Fuji Electric has established a quality control system for the
products it manufactures and sells and strives to ensure highquality standards. Although we have made the necessary
insurance arrangements, an unprecedented event could
cause quality-related problems in our products to arise andspread, which may affect our business performance andfinancial position.
(9) Human Resources and Labor
The business activities of Fuji Electric depend heavily on its
human resources. To attract and develop excellent humanresources in various fields—such as technology, production,
sales, and business management—we focus on cultivating
professional human resources who will help strengthen our
global competitiveness. We also actively conduct employee
education and training and are expanding mid-career
recruitment and other measures to attract exceptional humanresources. However, failure to attract and develop suchimportant human resources may have an impact on ourbusiness performance and financial position.
(10) Finance and Accounting
Seeking to minimize fund-raising costs, Fuji Electric
constantly examines the optimal mix of corporate bonds,
commercial paper, and short-term and long-term borrowings,
in order to ensure flexible and stable financing arrangements.
However, an unexpected increase in interest rates could
raise the interest rate burden on our interest-bearing debt,
which may have an impact on our business performance andfinancial position.
Fuji Electric works to strengthen credit management,
including by monitoring long-overdue receivables and thefinancial status of business partners, in order to enhance
its collection of trade receivables. However, restrictions on
economic activities and economic downturn could cause
business partners’ cash flows to deteriorate and prevent us
from recovering debts, which may have an impact on ourbusiness performance and financial position.

(11) Legal and EthicalFuji Electric engages in business in various fields and regions,and as such is subject to the laws and regulations of eachcountry. The Fuji Electric Compliance Promotion Committee,
chaired by our representative director, spearheads efforts
to ensure rigorous compliance with laws and regulations.
We also have a compliance program that clearly identifies
roles and responsibilities covering each aspect of legal
regulations—namely, internal rules, monitoring, auditing, andeducation—and our compliance structure also includes awhistleblowing system. However, any occurrence of legal
violations and the like may have an impact on our businessperformance and financial position.
In preparation for lawsuits and other legal disputes, Fuji
Electric has formed a task force aimed at building a system
to ensure that necessary procedures (fact investigation,corrective action, recurrence prevention, internal write-down,
and disclosure) and are conducted promptly. However,
we may be ordered to pay unexpectedly large amounts ofdamages, which, depending on the nature of the decision,
may have an impact on our business performance andfinancial position.
Fuji Electric strives to effectively protect intellectual
property rights and develop products and technologies that
respect the rights of other companies. Due to the speed oftechnological innovation and the global expansion of ourbusiness activities, however, intellectual property disputes
could arise, which may have an impact on our businessperformance and financial position.
(12) Political and Socioeconomic Trends
Fuji Electric engages in currency exchange contracts, basedon certain criteria, to minimize the impact of foreign exchange
fluctuations. However, any changes in exchange rates,
primarily between the yen and the U.S. dollar, may have an
impact on our business performance and financial position.
Fuji Electric develops its business in many overseas
markets, mainly in China and other Asian markets, and always
closely monitors the latest information on geopolitical risks.
We are also diversifying our production and sales bases in
preparation for unexpected risks.
However, any of the following events may have an impact
on our business performance and financial position:- Unexpected enactment of laws/regulations and changes intax systems with adverse effects- Disadvantageous political situations- Social turmoil due to social upheaval, terrorism, war, andthe like(13) Trends of Shareholder and Other Investors
Fuji Electric attaches great importance to disclosure offinancial information, active disclosure of non-financial
information, and communication with shareholders andinstitutional investors. We also strive to foster understandingof our management through sincere and accurate disclosureof information according to our Disclosure Policy. However,
the intentions of stockholders and other investors may differ
from those of the Company’s management, which could resultin a vote against the election of directors. Also, a shareholder
proposal against management could cause disruption of ouroperations. These and other events may have an impact on
our business performance and financial position.
(14) Natural Disasters and Accidents
Fuji Electric has business bases all over the world and iscommitted to fulfilling its responsibilities to customers andsociety by continuously supplying products and services inthe event of disaster or accident. To this end, we establisheda dedicated crisis management team to spearhead fire anddisaster prevention efforts, formulation of a business continuity
plan (BCP), and adoption of necessary insurance arrangements
in order to “strengthen our business continuity capability.”
However, any number of events may have an impact on ourbusiness performance and financial position. These include
large-scale disasters or accidents at/near our businesssites, which could cause damage of production equipment,interruption of operations, and delays in product shipments.
(15) External Attacks
To address increasingly diversified and sophisticated cybersecurity threats, Fuji Electric established a countermeasuresystem and a security response organization (CSIRT/SOC) tomonitor and suppress any attacks. We are also continuously
strengthening our response capabilities —in such areas asdefense, detection system reinforcement, and cyber training—
to prepare for the emergence of new threats. However, any
number of events may have an impact on our businessperformance and financial position. These include system
malfunction and information leakage due to external attacks(such as cyber-terrorism), resulting in loss of social trust.

Fuji Electric Report Financials 2023

10

Consolidated Balance Sheets
As of March 31, 2023 and 2022

Thousands of
U.S. dollars(Note 3)

Millions of yen

2022

2023

AssetsCurrent Assets:
Cash and cash equivalents (Note 6)
Short-term investments (Notes 5, 6 and 7)
Notes receivable-trade (Note 6)
Accounts receivable-trade (Note 6)
Contract assets
Allowance for doubtful accounts
Inventories (Note 4)
Other current assets
Total Current Assets

91,3501,615
75,521
217,73164,088(5,121)
170,295
66,502681,981$ 632,823
4,021
571,529
1,777,912
571,606(56,940)
1,493,920
370,196
5,365,067

Less accumulated depreciation
Net Property, Plant and Equipment

35,604
284,883
218,668
112,542
40,853
4,038
696,588(412,676)
283,91235,695275,247
201,219
95,027
8,635
2,432
618,255(384,580)
233,675

267,7032,141,982
1,644,123
846,182
307,153
30,365
5,237,508(3,102,826)
2,134,682

Investments and Other Assets:
Investment securities (Notes 5, 6 and 7):
Unconsolidated subsidiaries and affiliates
Other
Long-term loans receivable
Net defined benefit asset (Note 2 and 11)
Deferred tax assets (Note 16)
Other investments and other assets (Note 19)
Allowance for doubtful accounts
Total Investments and Other Assets
Total Assets

20,66987,790811
19,918
16,63638,751(488)
184,087¥ 1,181,552

22,554
103,761817
22,516
13,28638,990(468)
201,456¥ 1,117,112

155,411660,078
6,104
149,763
125,085
291,334(3,674)
1,384,101$ 8,883,850

Property, Plant and Equipment (Note 5):Land
Buildings and structures
Machinery and equipment
Lease assets (Note 19)
Construction in progress
Others

The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

11

Fuji Electric Report Financials 2023¥

84,165534
76,013
236,462
76,023(7,573)
198,691
49,238713,553¥2023

Thousands of
U.S. dollars(Note 3)

Millions of yen

2022

2023

Liabilities and Net Assets
Current Liabilities:
Short-term debt (Notes 5, 6 and 9)
Current portion of long-term debt (Notes 5, 6 and 9)
Trade payables (Notes 5 and 6)
Lease obligations (Notes 6 and 10)
Contract liabilities
Income taxes payable (Note 16)
Provision for product warranties (Note 2)
Other current liabilities (Note 24)
Total Current Liabilities
Long-term Liabilities:
Long-term debt (Notes 5, 6, and 9)
Lease obligations (Notes 6 and 10)
Net defined benefit liability (Notes 2 and 11)
Provision for directors’ retirement benefits
Deferred tax liabilities (Note 16)
Other long-term liabilities (Note 24)
Total Long-term Liabilities
Total Liabilities

¥

9,099
52,776
201,593
23,26149,44918,7103,775
88,163446,826¥

14,69130,293
171,749
19,58439,443
14,8797,280
89,050386,9692023$

68,415396,813
1,515,742
174,900
371,797
140,679
28,390662,8613,359,597

48,60046,89560,345
65
1,085
5,668
162,658
609,484

101,276
40,97857,590
94
1,580
4,896
206,414593,383

365,414352,597453,727489
8,159
42,6001,222,986
4,582,583

47,586—45,953364,922—47,58645,955319,285

357,790—345,518
2,743,775(7,370)—451,091—(7,359)405,467(55,417)—
3,391,666

45,550241
22,223(2,013)66,001
54,976572,068¥ 1,181,552

51,649507
14,1701,107
67,43350,829523,729¥ 1,117,112

342,4821,818
167,083(15,142)496,241
413,360
4,301,267$ 8,883,850

Contingent Liabilities (Note 19):
Net Assets (Note 25)
Shareholders’ Equity:
Capital stock (Note 12):
Authorized - 320,000,000 shares
Issued- 149,296,991 shares as of March 31, 2023
149,296,991 shares as of March 31, 2022
Capital surplus
Retained earnings
Treasury stock at cost (Note 12):6,462,999 shares as of March 31, 2023
6,461,058 shares as of March 31, 2022
Total Shareholders’ Equity
Accumulated Other Comprehensive Income (Loss):
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges (Notes 6 and 8)
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total Accumulated Other Comprehensive Income
Non-controlling interests
Total Net Assets
Total Liabilities and Net Assets

Fuji Electric Report Financials 2023

12

Consolidated Statements of Income
Years ended March 31, 2023 and 2022

Thousands of
U.S. dollars(Note 3)

Millions of yen

Net Sales
Cost of Sales (Note 13)
Gross Profit

2023

2022

2023

¥ 1,009,447
732,529
276,918¥ 910,226
657,790
252,436$ 7,589,829
5,507,735
2,082,094

188,036
88,882

177,601
74,835

1,413,807
668,287

3,742(1,993)(145)(1,148)878(2,405)(1,071)87,811

2,885(1,744)
(285)
1,288
1,647
671
4,462
79,29728,138(14,991)(1,090)(8,638)
6,603(18,070)(8,049)660,238

7,935
95,746

9,190
88,48759,659719,897

27,112
68,63423,93164,556

203,851
516,046

7,286
61,348

5,896¥ 58,660

54,781$ 461,265

Selling, General and Administrative Expenses (Notes 13 and 14)
Operating Profit
Non-Operating Income (Expenses):
Interest and dividend income
Interest expense
Provision of allowance for doubtful accounts for subsidiaries and affiliates
Foreign exchange losses (gains)
Equity in earnings of affiliates
Other, net
Ordinary Profit
Extraordinary Income, Net (Note 15)
Profit Before Income Taxes
Income Taxes (Note 16)
ProfitProfit Attributable To Non-controlling Interests
Profit Attributable To Owners of Parent (Note 25)
The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

13

Fuji Electric Report Financials 2023¥

Consolidated Statements of Comprehensive Income
Years ended March 31, 2023 and 2022

Thousands of
U.S. dollars(Note 3)

Millions of yen

Profit

2023

2022

2023

¥68,634¥64,556$ 516,046

Other Comprehensive Income (Loss) (Note 17)
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Share of other comprehensive income of associates accounted forusing equity method
Total Other Comprehensive Income(Loss)
Comprehensive Income(6,202)(265)
8,175(3,279)(4,222)
185
13,983(37)(46,636)(1,997)
61,478(24,658)

54(1,517)¥67,11720
9,929¥74,485410(11,403)$ 504,643

Comprehensive Income Attributable to:
Owners of parent
Non-controlling interests¥59,9157,202¥67,1187,367$ 450,489
54,155The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

Fuji Electric Report Financials 2023

14

Consolidated Statements of Changes in Net Assets
Years ended March 31, 2023 and 2022

Thousands

Balance at March 31, 2021

Millions of yen

Number ofshares ofcapital stock

Capitalstock

Capitalsurplus149,296¥47,586¥46,003

Retainedearnings

Valuationdifference on
available-forsale securities

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustments

Remeasurements ofdefinedbenefit plans

Treasury
stock

Total

Noncontrollinginterests

Total
net assets¥271,772¥55,761¥322¥1,542¥ 1,351¥(7,340)¥416,997¥44,257¥461,254

Cumulative effect of changes
in accounting policies

—

—

—

1,708

—

—

—

—

—

1,708

—

1,708

Restated balance—

47,58646,003

273,480

55,761

322

1,542

1,351

(7,340)418,705

44,257462,962

Profit attributable to ownersof parent———

58,660

—

—

—

—

—

58,660—58,660Change of scope of
consolidation

—

—

—

0

—

—

—

—

—

0

—

0

Cash dividends

—

—

—

(12,855)

—

—

—

—

—

(12,855)—(12,855)

Purchase of treasury stock

—

—

—

—

—

—

—

—

(19)

(19)

—

(19)

Sales of treasury stock

—

—

0

—

—

—

—

—

0

0

—

0

Change in treasury sharesof parent arising fromtransactions with
non-controlling shareholders

—

—

(48)

—

—

—

—

—

—

(48)

—

(48)

—

(4,112)

185

12,628

(244)

—

8,457

6,572

15,029¥45,955¥319,285¥51,649¥507¥14,170¥ 1,107¥(7,359)¥472,900¥50,829¥523,729

Net changes of items otherthan shareholders’ equity——

Balance at March 31, 2022

149,296¥47,586

Cumulative effect of changes
in accounting policies

—

—

—

—

—

—

—

—

—

—

—

—

Restated balance—

47,58645,955319,285

51,649507

14,1701,107(7,359)472,900

50,829523,729

Profit attributable to ownersof parent———

61,348

—

—

—

—

—

61,348—61,348Change of scope of
consolidation

—

—

—

—

—

—

—

—

—

—

—

—

Cash dividends

—

—

—

(15,711)

—

—

—

—

—

(15,711)—(15,711)Purchase of treasury stock

—

—

—

—

—

—

—

—

(11)

(11)

—

(11)

Sales of treasury stock

—

—

0

—

—

—

—

—

0

0

—

0

Change in treasury sharesof parent arising fromtransactions with
non-controlling shareholders

—

—

(2)

—

—

—

—

—

—

(2)

—

(2)

—

(1,432)

4,147

2,715

¥(7,370) ¥517,092¥54,976¥572,068

Net changes of items otherthan shareholders’ equity

—

—

—

—

(6,099)

(266)

8,053

(3,120)

Balance at March 31, 2023

149,296¥47,586¥45,953¥364,922¥45,550¥241¥22,223¥(2,013)

Balance at March 31, 2022

149,296$357,790$345,527 $2,400,644 $388,343$3,815

Thousands of U.S. dollars (Note 3)

Cumulative effect of changes
in accounting policies——

Restated balance—

357,790

Profit attributable to ownersof parent———

Change of scope of
consolidation——

Cash dividends——

Purchase of treasury stock—

Sales of treasury stock—

Change in treasury sharesof parent arising fromtransactions with
non-controlling shareholders—

Net changes of items otherthan shareholders’ equity
Balance at March 31, 2023

—

—

—

—

388,343

3,815

106,534

8,325

461,265

—

—

—

—

—

—

—

—

—

—

—

—

(118,134)

—

—

—

—

—

—

—

—

—

—

—

0

—

—

—

—

—

(9)

—

—

—

—

—

—

(45,861)(1,997)60,549(23,467)$345,518 $2,743,775 $342,482$1,818$167,083$(15,142)——$357,790

Fuji Electric Report Financials 2023$(55,335) $3,555,643 $382,175 $3,937,818—

The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

15$ 8,325

345,527 2,400,644

149,296—$106,534——(55,335) 3,555,643——

382,175 3,937,818

461,265—

461,265

—

—

—

—

—

(118,134)—(118,134)

—

(82)

(82)

—

(82)

—

—

0

—

0

—

—

(9)

—

(9)

—

(10,776)

31,185

20,409$(55,417) $3,887,907 $413,360 $4,301,267

Consolidated Statements of Cash Flows
Years ended March 31, 2023 and 2022

Thousands of
U.S. dollars(Note 3)

Millions of yen

Cash Flows from Operating Activities:
Profit before income taxes
Depreciation and amortization
Increase in allowance for doubtful accounts
Decrease in provision for product warranties
Interest and dividend income
Interest expense
Foreign exchange losses
Gain on sales of noncurrent assets
Gain on sales of investment securities
Loss on disposal of noncurrent assets
Loss on devaluation of investment securities
Factory integration expenses
Loss on withdrawal from business
Provision for loss on liquidation of subsidiaries and associates
Changes in operating assets and liabilities:
Trade receivables and contract assets
Inventories
Trade payables
Contract liabilities
Other, net
Cash generated from operations
Interest and dividends received
Interest expenses paid
Income taxes paid
Net cash provided by operating activities
Cash Flows from Investing Activities:
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of investment securities
Proceeds from sales of investment securities
Payments of loans receivableCollection of loans receivable
Other, net
Net cash used in investing activities
Cash Flows from Financing Activities:
Net decrease in short-term loans payable
Repayment of long-term loans payable
Repayments of lease obligations
Proceeds from sales of treasury stock
Purchase of treasury stock
Cash dividends paid
Cash dividends paid to non-controlling interests
Payments from changes in ownership interests in subsidiaries that do not result inchange in scope of consolidation
Proceeds from share issuance to non-controlling shareholders
Proceeds from sale and leaseback transactions
Other, net
Net cash used in financing activities
Effect of Exchange Rate Changes on Cash and Cash Equivalents
Net Increase(Decrease) in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of Year
Increase in cash and cash equivalents resulting from merger withunconsolidated subsidiaries
Cash and Cash Equivalents at End of Year

2023

2022

2023

¥ 95,746
45,9382,347(3,506)(3,742)
1,993
(474)
(939)
(9,917)
569
1,236
—
—
1,115

¥ 88,487
39,9691,006(8,711)(2,885)
1,744
(226)
(179)
(10,359)
632
239
335
141
—

$ 719,897
345,401
17,654(26,361)(28,138)
14,991(3,570)(7,061)(74,564)
4,281
9,294
—
—
8,391

(28,444)(25,709)28,711
9,748
22,934
137,606
3,679(1,996)(23,126)
116,163(749)(5,707)(2,623)9,339(9,624)
100,829
2,847(1,738)(25,129)76,809(213,868)(193,305)
215,872
73,296
172,434
1,034,644
27,664(15,015)(173,881)
873,412(61,080)
2,698
(212)
17,842(14,123)
11,306(5,929)(49,498)(33,047)
3,762(1,909)17,408(11,146)
7,324(4,742)(22,350)(459,251)
20,286(1,600)134,157(106,194)
85,009(44,578)(372,171)(6,002)(30,330)(23,580)0(10)(15,711)(3,508)(3,592)(4,405)(20,551)0(19)(12,855)(1,308)(45,134)(228,049)(177,298)0(82)(118,135)(26,382)

(2)
—
1,955
(4)
(77,192)
3,210(7,317)91,350

(163)
0
0
(1)
(42,894)
4,453
16,01875,332(21)—
14,7000(580,401)
24,136(55,024)
686,848132¥ 84,165—¥ 91,350

999$ 632,823

The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

Fuji Electric Report Financials 2023

16

Notes to the Consolidated Financial Statements
Note 1. Basis of Preparing Consolidated Financial Statements
The accompanying consolidated financial statements of Fuji
Electric Co., Ltd. (the “Company”) and consolidated subsidiaries(together, the “Companies”) are prepared on the basis of accounting
principles generally accepted in Japan, which are different incertain respects as to application and disclosure requirements ofInternational Financial Reporting Standards, and are compiled fromthe consolidated financial statements prepared by the Company as
required by the Financial Instruments and Exchange Law of Japan.
In preparing these statements, certain reclassifications andrearrangements have been made to the consolidated financial
statements prepared domestically in Japan in order to present
these statements in a form that is more familiar to readers
outside Japan.
In addition, the notes to the consolidated financial statements
include additional information which is not required underaccounting principles generally accepted in Japan.
Certain amounts in the prior year’s financial statements havebeen reclassified to conform to the current year’s presentation.

Note 2. Summary of Significant Accounting Policies
a. Principles of Consolidation
The consolidated financial statements for the year ended March
31, 2023 include the accounts of the Company and its 70
significant subsidiaries and its 4 subsidiaries and affiliates areaccounted for by the equity method (71 and 4 in 2022).
Under the control or influence concept, the accompanying
consolidated financial statements include the accounts of theCompany and, with minor exceptions, those of its subsidiaries,
whether directly or indirectly controlled, and those companies
over which the Companies have the ability to exercise significant
influence are accounted for by the equity method. All significant
intercompany balances and transactions have been eliminatedin consolidation. All material unrealized profits included in assets
resulting from transactions within the Companies are eliminated.
The Company does not consolidate nor apply the equity method
to subsidiaries or affiliates whose gross assets, net sales, profit(loss) and retained earnings are not significant to the consolidated
financial statements.
Investments in unconsolidated subsidiaries and affiliates arestated at cost.
The balance sheet date of certain consolidated subsidiaries is
December 31 or January 31. In principle, the financial statementsof such subsidiaries were tentatively prepared in accordance withthe fiscal year of the Company, and those were consolidated.
In the elimination of investments in subsidiaries, theassets and liabilities of the subsidiaries, including the portion
attributable to non-controlling shareholders, are evaluated using
the fair value at the time the Company acquired control of therespective subsidiaries.
Goodwill resulting from the difference between the cost andthe underlying net assets at the respective dates of acquisition arebeing amortized over a period of 5 or 10 years.

b. Cash Equivalents
For the purpose of the consolidated statements of cash flows, theCompanies consider all short-term, highly liquid instruments with amaturity of three months or less to be cash equivalents.

c. Inventories
Raw materials are mainly stated at cost, determined by themost recent purchase price method. Finished goods and workin process are mainly stated at actual cost determined byaccumulated production cost for contract items or average costfor regular production items, except that finished goods of certain

17

Fuji Electric Report Financials 2023

consolidated subsidiaries are priced by the most recent purchaseprice method. In accordance with accounting practices generally
accepted in the heavy electric industry, inventories include itemswith a manufacturing period exceeding one year.
Inventories with lower profitability were written down and thelosses on valuation were included in cost of sales.

d. Securities
Other securities
Securities with quoted market price are stated at fair value.
Unrealized gains and losses, net of taxes, are reported in a
separate component of net assets.
Securities with no quoted market price are stated at cost
determined by the moving-average method.

e. Derivatives and Hedging Activities
The Companies enter into derivative financial instruments(“derivatives”), including foreign currency forward contracts tohedge foreign exchange risk associated with certain assets andliabilities denominated in foreign currencies.
In addition, the Companies enter into commodity swap
agreements to hedge the risk of fluctuation of commodity prices
for raw materials.
Derivative financial instruments and foreign currencytransactions are classified and accounted for as follows:a) E xcept as described in the following paragraphs b) and c),
all derivatives are recognized as either assets or liabilities
and measured at fair value, and forward contracts applied
for forecasted transactions are measured at fair value but
the unrealized gains/losses are deferred until the underlying
transactions are completed if the forward contracts qualify
for hedge accounting.
b) Trade receivables and trade payables denominated inforeign currencies for which foreign exchange forward
contracts are used to hedge the foreign currency
fluctuations are accounted for allocation treatment (“Furiate
shori”) where these receivables and payables are translated
at the contracted rate if the forward contracts qualify forhedge accounting.

f. Depreciation
1) Tangible fixed assets (excluding leased assets)
Depreciation is computed by the declining-balance method at
rates based on the estimated useful lives of the assets, while thestraight-line method is applied to the buildings of the Company
and its domestic consolidated subsidiaries acquired after April 1,
1998 and the facilities attached to buildings and the other nonbuilding structures acquired after April 1, 2016. The range of useful
lives is from 15 to 50 years for buildings and from 5 to 12 years formachinery and equipment.
2) Leased assets
Depreciation is computed by the straight-line method over thelease period assuming no residual value. Finance leases otherthan those that were deemed to transfer the ownership of theleased assets to the lessees and contracted before April 1, 2008,
are accounted for by the method that is applicable to ordinary
operating leases.

g. Allowance for Doubtful Accounts
The allowance for doubtful accounts is stated in amounts
considered to be appropriate based on the Companies’ pastcredit loss experience and an evaluation of potential losses in thereceivables outstanding.

h. Provision for Directors’ Retirement Benefits
For certain consolidated subsidiaries, provision for directors’
retirement benefits were provided mainly at an amount to berequired at the year-end according to internal regulations.

i. Provision for product warranties
To prepare for potential warranty costs, provision for productwarranties is recorded based on the past occurrence of thedefects and expected specific events.

j. Retirement Benefits(1)	The retirement benefit obligation for employees is attributed toeach period by the benefit formula method over the estimatedyears of service of the eligible employees.
(2)	Prior service costs are amortized by the straight-line method
within the average remaining years of service of the employee
participants. The actuarial gains and losses are amortized by
the straight-line method within the average remaining years ofservice of the employee participants from the next period inwhich they arise, respectively.

k. Research and Development Costs
Research and development costs are charged to income as incurred.

The Companies are engaged in a wide range of businessactivities, such as product development, production, sales,and services. The details of the main performance obligations
related to revenues from the contracts with the customers
in the main business and the normal time points to satisfy
the performance obligations(normal time points to recognize
revenues) are as follows.
(1) Sales of standard products
For the performance obligation, control of goods is transferred to acustomer at a point in time.
For domestic sales, the Companies recognize revenue upon
shipment because the period from shipment to transfer of control
of goods to customer is the normal period. (Application of shipping
standards) For domestic sales which do not apply shipping
standards, the Companies recognize revenue upon delivery of
goods to a customer.
For export transactions, the Companies recognize revenue
upon delivery of goods to customer specified in trade terms.
(2) S ales of job-order production goods, contract works andrendering of services
For the performance obligation, the Companies apply the methodthat revenue is recognized over time by measuring progress
toward complete satisfaction of performance obligations (thecost-based input method is used in measuring the progress). The
progress toward complete satisfaction of performance obligations
is determined based on the ratio of costs incurred to the end of
the fiscal year to the estimate of the total cost of the contract.
In the case that progress cannot be reasonably estimated, theCompanies recognize revenue under the cost recovery method
only to the extent of the costs incurred that are expected to be
recovered. For maintenance contracts, etc., in which services
are rendered to customers evenly over the contract period, theCompanies recognize revenue on a straight-line basis over thecontract period. When an invoiced amount (right to invoice)directly corresponds to the consideration amount for the satisfied
performance obligation, the Companies recognize revenue by theamount in which the invoice is entitled. Regarding estimates ofprogress toward complete satisfaction of performance obligations,the Companies apply a method that appropriately reflects thetransfer of control and consistently apply it to similar performanceobligations. In addition, the progress toward complete satisfactionof performance obligations is appropriately reviewed at the end of
the fiscal year.

l. Recognition for Revenue and Costs
In accordance with the following five-step approach, theCompanies recognize a transfer of a promised good or service
to a customer as revenue in an amount which reflects theconsideration expected to be entitled in exchange for the goodor service.
Step 1: Identify the contract(s) with a customer
Step 2: Identify the performance obligations in the contract.
Step 3: Determine the transaction price
Step 4: A llocate the transaction price to the performanceobligations in the contract
Step 5: R ecognize revenue when (or as) the Companies satisfies a
performance obligation

m. Income Taxes
The provision for income taxes is computed based on the pretax
income included in the consolidated statements of income. The
Company filed a consolidated tax return, which allows companies
to file tax payments on the combined basis of profits or losses ofthe parent company and its wholly owned domestic subsidiaries.
The asset and liability approach is used to recognize deferred tax
assets and liabilities for the expected future tax consequences of
temporary differences between the carrying amounts and the tax
bases of assets and liabilities. Deferred taxes are measured byapplying currently enacted tax laws to the temporary differences.

Fuji Electric Report Financials 2023

18

n. Foreign Currency Transactions
All monetary receivables and payables denominated in foreign
currencies are translated into Japanese yen at the exchange rates
at the balance sheet date. The foreign exchange gains and losses
from translation are recognized in the consolidated statements
of income to the extent that they are not hedged by forward
exchange contracts.

o. Foreign Currency Financial Statements
Assets, liabilities, and revenue and expense accounts of theforeign consolidated subsidiaries are translated into Japanese yenat the current exchange rate as of the balance sheet date except
for shareholders’ equity, which is translated at the historical rate.
Differences arising from such translation are included in foreign
currency translation adjustments and non-controlling interests inconsolidated subsidiaries as a separate component of net assets.

p. Amounts Per Shareto common shareholders of the parent and the weighted average
number of shares of common stock outstanding during the year,
and diluted profit per share is computed based on the profit
attributable to owners of parent’s common stock and weighted
average number of shares of common stock outstanding during
each year after giving effect to the dilutive potential of shares ofcommon stock to be issued upon the exercise of warrants andstock subscription rights.
Net assets per share are computed based on the net assets
excluding share subscription rights and non-controlling interests
and the number of shares of common stock outstanding at theyear end.

q. Other Significant Accounting Policies for
Preparation of Consolidated Financial Statements
The Company and some domestic consolidated subsidiaries
applied the Group Tax Sharing System from the beginning of thecurrent fiscal year.

Basic profit per share is computed based on the profit attributabler. Accounting Standard for Disclosure of Accounting Estimates
1. Revenues recognized over time by measuring progress toward complete satisfaction of performance obligations(1) Amounts recorded for the year ended March 31, 2023
Thousands of
U.S. dollars (Note 3)

Millions of yen

Sales
Ending balance of contract assets(construction contract receivable for the previous fiscal year)

2023

2022

2023

¥ 107,118¥ 94,957$ 805,398

56,693

46,349426,270

Note: T he above amounts represent unfinished, undelivered, or imcomplete contracts of job-order production goods, contract works and rendering of services, which recognize
revenues over time by measuring progress toward complete satisfaction of performance obligations, as of the end of the current fiscal year. (Contracts which have satisfied theall performance obligations are not included. In addition, contracts in which revenues are recognized under the cost recovery method, which recognizes revenue only to theextent of the costs incurred expected to be recovered in the case that progress cannot be reasonably estimated, are not included.)(2) S upplemental information for understanding
the consolidated financial statements
a. Calculation method
For construction contracts, the Companies apply the method thatrevenue is recognized over time by measuring progress toward
complete satisfaction of performance obligations (the cost-based
input method is used in measuring the progress). The progress
toward complete satisfaction of performance obligations isdetermined based on the ratio of costs incurred to the end of the
fiscal year to the estimation of the total cost of the contract.
b. Key assumption
The estimates of total costs are calculated by aggregating
objective prices such as third party quotations and internally

19

Fuji Electric Report Financials 2023

approved standard unit prices. However, the estimates of
total costs are the key assumption because the Companies
also rely on their specialized knowledge of and experience inconstruction contract.
c. Effect on the subsequent fiscal year
Since construction contracts are, in general, long-term contracts,
construction contracts may potentially be modified and there
may be fluctuations in material, labor, and other such costs whileconstruction contracts are still in progress. Corresponding tochanges in the estimates of total costs, progress rates change andthe amount of revenue to be recognized in the subsequent fiscal
year may be affected.

2. Calculation of defined benefit obligation(1) Amounts recorded for the year ended March 31, 2023
Thousands of
U.S. dollars (Note 3)

Millions of yen

Net defined benefit asset
Net defined benefit liability
Remeasurements of defined benefit plans(2) S upplemental information for understanding
the consolidated financial statements
a. Calculation method
The Companies primarily apply defined benefit plans. Defined
benefit obligation for defined benefit plans is estimated by
payment calculation standard, based on discount rates andactuarial assumptions, such as mortality rates, retirement rates,
salary inflation etc.
b. Key assumption
Discount rates are calculated by the yield curve equivalentapproach primarily based on high quality corporate bonds.
c. Effect on the subsequent fiscal year
In the case that it is necessary to review discount rates, which areused to calculate defined benefit obligation, net defined benefit
asset, net defined benefit liability, and remeasurements of defined
benefit plans for the subsequent fiscal year may be affected.

s. Change in accounting policy
Application of “Accounting Standard for
Fair Value Measurement”
From the beginning of the current fiscal year, the Companies
applied the “Implementation Guidance on Accounting Standard for
Fair Value Measurement” (ASBJ statement No. 31 issued on June17, 2021). In accordance with the transitional treatment stipulated
in paragraph 27-2 of the “Implementation Guidance on AccountingStandard for Fair Value Measurement,” the new accounting policy“Implementation Guidance on Accounting Standard for Fair Value
Measurement” will be applied in the future. The application does
not affect the consolidated financial statements.

2023

2022

2023

¥ 19,918
60,345(2,013)¥ 22,516
57,5901,107$ 149,762
453,727(15,142)t. Unapplied accounting standards•	“Accounting Standard for Income Taxes - Current”(ASBJ Statement No. 27, October 28, 2022, AccountingStandards Board of Japan)•	“Accounting Standard for Presentation of Comprehensive
Income” (ASBJ Statement No. 25, October 28, 2022)•	“Implementation Guidance on Accounting Standard for Tax
Effect Accounting” (ASBJ Guidance No. 28, October 28,
2022, ASBJ)(1) Overview
Transferring the practical guidelines on tax effect accounting at the
JICPA to the ASBJ has been completed, after the release of ASBJ
Statement No. 28 “Partial Amendments to Accounting Standard
for Tax Effect Accounting” etc. in February 2018. In the courseof deliberations, two issues would be considered again after the
release of ASBJ Statement No.28. The result of consideration as
follows.
• Classification of tax expenses (taxation on other comprehensive
income)• Tax effect on the sale of shares of subsidiaries or affiliates when
the group corporation taxation is applied.
(2) Schedule date of adoption
The accounting standard will be applied from the beginning of the
fiscal year ending March 31, 2025.
(3) Impact of adoption of accounting standard andimplementation guidance
The effect of the application of the “Accounting Standard forIncome Taxes-Current” and other related accounting standards
on the consolidated financial statements is currently underevaluation.

Fuji Electric Report Financials 2023

20

Note 3. U.S. Dollar Amounts
The U.S. dollar amounts included in the accompanying
consolidated financial statements and notes thereto represent
the arithmetic results of translating yen into U.S. dollars at¥133=U.S.$1, the approximate exchange rate as of March 31,
2023. The U.S. dollar amounts are presented solely for theconvenience of the readers outside Japan.

Note 4. Inventories
Inventories as of March 31, 2023 and 2022 consisted of the following:Thousands of
U.S. dollars (Note 3)

Millions of yen

Merchandise and finished goods
Work in process
Raw materials
Inventories

2023

2022

2023

¥ 64,500
54,642
79,549¥ 198,691¥ 55,051
51,82763,417¥ 170,295$ 484,967
410,847
598,106$ 1,493,920

Losses on valuation of inventories with lower profitability were ¥2,109 million ($15,861 thousand) and ¥71 million for the years ended
March 31, 2023 and 2022, respectively. These were included in cost of sales.

Note 5. Pledged Assets and Financial Assets Accepted as Collateral
The amounts of assets pledged as collateral for trade payables, short-term debt and long-term debt as of March 31, 2023 and 2022 wereas follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Investment securities
Property, plant and equipment
Total

2023

2022

2023

¥ 17
424
¥ 441

¥ 17
443
¥ 460

$ 133
3,189
$ 3,322

Collateralized liabilities as of March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Trade payables
Short-term debt
Total

21

Fuji Electric Report Financials 2023

2023

2022

2023

¥ 78
291
¥ 369

¥ 78
153
¥ 231

$ 589
2,189
$ 2,778

Note 6. Financial Instruments
1. Status of financial instruments(1) Policy regarding financial instruments
The Companies limit the scope of their cash and fundmanagement activities to short-term deposits. When raisingfunds, the Companies have a policy of relying principally onbank borrowings, bonds payable and commercial paper. The
Companies mainly raise the operating funds through short-termloans payable and commercial paper, and the funds relating tocapital investments through long-term loans payable and bonds
payable. The Companies make use of derivatives to reduce risk,
as explained below, and have a policy of not engaging in derivativetransactions for speculative purposes.
(2) Details of financial instruments and associated risk
In the course of its business activities, trade receivables are
exposed to customer credit risk.
In addition, trade receivables denominated in foreign currencies
arising from international business are exposed to exchangerisk. The Companies hedge the exchange risk, by using foreignexchange forward contracts within the range prescribed relating
to the net amount of the trade receivables denominated inforeign currencies, offset by the amount of the trade payables
denominated in the same currencies.
Short-term investments and investment securities arecomprised primarily of stocks of companies with which theCompanies have business relation and are exposed to market
price risk.
Trade payables are mostly payable within one year. Some
trade payables are denominated in foreign currencies andexposed to exchange risk. The Companies hedge the exchange
risk of the trade payables denominated in foreign currencies inprinciple, except for the amount within that of trade receivables
denominated in the same currencies, by using foreign exchange
forward contracts.
Short-term loans payable and commercial paper are primarilyraised for the purpose of maintaining operating funds. Bonds
payable, long-term loans payable and lease obligations on financelease transactions are primarily raised for the purpose of preparing
capital investment. The maturities of these bonds payable,
long-term loans payable and lease obligations on finance leasetransactions are up to 15 years at the longest after the balance
sheet date. Some are exposed to interest rate fluctuation andexchange risk.
Regarding derivatives, the Companies employ foreignexchange forward contracts to reduce the risk of foreign currency
exchange movements that arise from the previously mentioned
receivables and payables denominated in foreign currencies.
In addition, the Companies use commodity swap transactions
to reduce the risk of fluctuation of commodity prices for raw
materials. As hedging instruments under hedge accounting, theCompanies enter into these derivative transactions in accordancewith Companies’ policies to reduce the corresponding risk to eachhedged item. The Companies compare the market change ofhedged items and hedging instruments or the cash flow changes.
Assessment of effectiveness for hedging activities depends on theratio of the amount of change.

(3) Systems for management of financial instruments riska) C redit risk management (the risk that transaction partners
may default on their obligations to the Companies)
The credit risk in relation to trade receivables from customers,
pursuant to criteria for managing credit exposure, is managed bycontrolling due dates and balances of each customer. In addition,
the Companies manage to identify doubtful receivables earlier
and mitigate their risk caused by aggravation of the financing
position, etc.
Because the counterparties to derivative transactions arelimited to authentic financial institutions, the Companies do not
anticipate any losses arising from credit risk.
b) M arket risk management (the risks arising fromfluctuations in exchange rates, interest rates and otherindicators)
The Companies, in principle, employ foreign exchange forward
contracts to reduce the risk of foreign currency exchange
movements that arise from the previously mentioned receivables
and payables denominated in foreign currencies. In addition, theCompanies use commodity swap transactions to reduce the riskof fluctuation of commodity prices for raw materials.
Regarding investment securities, the Companies periodicallyreview the market value of such financial instruments and thefinancial position of the issuer (the company having business
transactions with the Companies). In addition, other than debt
securities to be held until maturity, the Companies review thestatus of these investments on a continuing basis.
Derivative transactions have been entered into in accordancewith the Companies’ policies. The execution of derivatives, which
is based on the application of each section, is mainly controlled
by the Finance Department of each company, or by the Material
Section regarding commodity swap transactions. In addition, theFinance Department periodically reports to the management andeach section, and strictly performs risk management relating toderivative transactions.
c) L iquidity risk management (the risk that the Companies
may not be able to meet its payment obligations on thescheduled date)
The Companies reduce the liquidity risk by having each company
review and revise cash management plans monthly or timely.
(4) S upplementary explanation of the estimated fair value offinancial instruments and related matters
Since variable factors are taken into account in computing thefair value of financial instruments, the price is may fluctuate
depending on different assumptions adopted. In addition, thecontract (notional) amount of derivatives in “Note 8. Derivatives”
is not an indicator of the actual market risk involved in derivativetransactions.

Fuji Electric Report Financials 2023

22

2. Estimated fair value and other matters related to financial instruments
Carrying amounts on the consolidated balance sheets as of March 31, 2023 and 2022, estimated fair value and the variance between
them are shown in the following table.
Millions of yen

2023

Accounts receivable-trade
Investment securities
Bonds
Long-term debt
Lease obligations
Derivatives
Derivative transactions to which hedge accounting is not applied
Derivative transactions to which hedge accounting is applied

Carrying amounts

Fair value

Variance¥ 236,462
93,158(35,000)(28,600)(70,157)¥ 236,308
100,430(34,832)(28,566)(70,517)¥ (154)
7,272
(168)
(34)
360

(239)
348

(239)
348

—
—

Note: The following securities with no quoted market price are not included in the “Investment securities.”
Millions of yen

2023
Carrying amounts
Unlisted stocks (including stocks of unconsolidated subsidiaries and affiliates)¥15,301

Millions of yen

2022

Accounts receivable-trade
Investment securities
Bonds
Long-term debt
Lease obligations
Derivatives
Derivative transactions to which hedge accounting is not applied
Derivative transactions to which hedge accounting is applied

Carrying amounts

Fair value¥ 217,731
110,217(35,000)(66,276)(60,562)¥ 217,702
121,365(34,851)(66,264)(60,908)

(150)
731

(150)
731

Variance¥(29)
11,148
(149)
(12)
346
—
—

Note: The following securities with no quoted market price are not included in the “Investment securities.”
Millions of yen

2022
Carrying amounts
Unlisted stocks (including stocks of unconsolidated subsidiaries and affiliates)¥16,098

Thousands of U.S. dollars (Note 3)2023

Accounts receivable-trade
Investment securities
Bonds
Long-term debt
Lease obligations
Derivatives
Derivative transactions to which hedge accounting is not applied
Derivative transactions to which hedge accounting is applied

Carrying amounts

Fair value

Variance$ 1,777,912
700,443(263,157)(215,037)(527,497)$ 1,776,756
755,113(261,898)(214,789)(530,207)$ (1,156)
54,6701,259
248(2,710)(1,801)
2,619(1,801)
2,619——

Note: The following securities with no quoted market price are not included in the “Investment securities.”
Thousands of
U.S. dollars (Note 3)

2023
Carrying amounts
Unlisted stocks (including stocks of unconsolidated subsidiaries and affiliates)$115,045(*1) Figures shown in parentheses are liability items.
(*2) The value of assets and liabilities arising from derivatives is shown at net value, and a net liability position is shown in parentheses.
(*3) S ince Cash and cash equivalents, Notes receivable-trade, Trade payables, and Short-term debt are settled in a short period of time, estimated fair values are virtually thesame as the carrying amounts.

23

Fuji Electric Report Financials 2023

Note 1: Redemption schedule for monetary assets and securities with maturity dates as of March 31, 2023 and 2022:
Millions of yen

2023
Within 1 year
Cash and cash equivalents¥ 84,165

Between 1 and5 years¥

Between 5 and10 years—¥

Notes receivable-trade

76,013——

Accounts receivable-trade

231,349

2,622

2,491

¥ 391,527¥ 2,622¥ 2,491

Total

Over 10 years

—

¥

—
—
—

¥

—

Millions of yen

2022
Within 1 year
Cash and cash equivalents¥ 91,350

Notes receivable-trade¥75,521

Accounts receivable-trade
Total

Between 1 and5 years

Between 5 and10 years

—

¥ —

—

—

215,671

1,579

482

¥ 382,542¥ 1,579¥ 482

Over 10 years
¥

—
—
—

¥

—

Thousands of U.S. dollars (Note 3)2023
Within 1 year
Cash and cash equivalents$

632,823

Notes receivable-trade
Accounts receivable-trade
Total

Between 1 and5 years$

Between 5 and10 years—$

Over 10 years

—

$

—

571,529———

1,739,464

19,716

18,733—$ 2,943,816$ 19,716$ 18,733$—

Note 2: R epayment schedule for long-term debt and lease obligations:
Please refer to “Note 9. Short-term Debt and Long-term Debt” and “Note 10. Lease Obligations.”

3. Fair value of financial instruments by levels
Financial instruments measured at fair value are classified into the following three levels based on the observability and significance of
inputs used to measure such financial instruments.
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities
Level 2: Fair value, other than Level 1, that is determined by directly or indirectly using the observable price
Level 3: Fair value determined by using valuation techniques that incorporate unobservable inputs
When several inputs are used for a fair value measurement, the level is determined based on the input that is significant with thelowest level in the fair value measurement.
(1) Financial instruments measured at fair value on the consolidated balance sheets
Millions of yen

2023
Fair value
Class of financial instrument

Investment securities
Other securities
Equity securities
Total financial assets at fair value
Derivatives
Currency derivatives
Total derivatives at fair value

Level 1

Level 2

Level 3

Total

¥ 83,754¥ 83,754

¥ —
¥ —

¥ —
¥ —

¥ 83,754¥ 83,754

¥
¥

¥ 108
¥ 108

¥ —
¥ —

¥
¥

—
—

108
108

Millions of yen
2022
Fair value
Class of financial instrument

Investment securities
Other securities
Equity securities
Total financial assets at fair value
Derivatives
Currency derivatives
Total derivatives at fair value

Level 1

Level 2

Level 3Total

¥ 99,698¥ 99,698

¥ —
¥ —

¥ —
¥ —

¥ 99,698¥ 99,698

¥
¥

¥ 581
¥ 581

¥ —
¥ —

¥
¥

—
—

581
581

Fuji Electric Report Financials 2023

24

Thousands of U.S. dollars (Note 3)

2023
Fair value
Class of financial instrument

Investment securities
Other securities
Equity securities
Total financial assets at fair value
Derivatives
Currency derivatives
Total derivatives at fair value

Level 1

Level 2

Level 3Total

$ 629,733$ 629,733

$ —
$ —

$ —
$ —

$ 629,733$ 629,733

$
$

$ 819
$ 819

$ —
$ —

$
$

—
—

819
819

Note: The value of assets and liabilities arising from derivatives is shown at net value, and a net liability position is shown in parentheses.

(2) Financial instruments other than those measured at fair value on the consolidated balance sheets
Millions of yen

2023
Fair value
Class of financial instrument

Accounts receivable-trade
Investment securities
Unconsolidated subsidiaries and affiliates
Shares of Affiliates
Total financial assets at fair value
Bonds
Long-term debt
Lease obligations
Total financial liabilities at fair value

Level 1

Level 2

Level 3

Total—

¥ 236,308¥ —¥ 236,308

16,675¥ 16,675
¥
—
—
—
¥
—

—
¥ 236,308¥ 34,832
28,56670,519¥ 133,917

—
¥ —
¥ —
—
—
¥ —

16,675¥ 252,984¥ 34,832
28,56670,519¥ 133,917¥

Millions of yen
2022
Fair value
Class of financial instrument

Accounts receivable-trade
Investment securities
Unconsolidated subsidiaries and affiliates
Shares of Affiliates
Total financial assets at fair value
Bonds
Long-term debt
Lease obligations
Total financial liabilities at fair value

Level 1

Level 2

Level 3Total—

¥ 217,702¥ —¥ 217,702

21,666¥ 21,666
¥
—
—
—
¥
—

—
¥ 217,702¥ 34,851
66,26460,909¥ 162,024

—
¥ —
¥ —
—
—
¥ —

21,666¥ 239,368¥ 34,851
66,26460,909¥ 162,024¥

Thousands of U.S. dollars (Note 3)

2023
Fair value
Class of financial instrument

Accounts receivable-trade
Investment securities
Unconsolidated subsidiaries and affiliates
Shares of Affiliates
Total financial assets at fair value
Bonds
Long-term debt
Lease obligations
Total financial liabilities at fair value

Level 1

Level 2

Level 3

Total—

$ 1,776,756$ —$ 1,776,756

125,380$ 125,380
$
—
—
—
$
—

—
$ 1,776,756$ 261,898
214,789
530,207$ 1,006,895

—
$ —
$ —
—
—
$ —

125,381$ 1,902,137$ 261,898
214,789
530,207$ 1,006,895$

Notes: Measurement method and description of inputs for fair value for financial instruments(1) Investment securities
The fair value of listed stocks is based on the quoted price. Since listed stocks are traded in active markets, the fair value is classified as Level 1.
(2) Derivatives
The fair values of foreign currency forward contracts and commodity swap contracts are based on the the prices provided by financial institutions and the fair value isclassified as Level 2. In addition, since foreign currency forward contracts under the allocation method are treated together with accounts receivable-trade, contract assets
and accounts payable-trade the fair value of such contracts is included in the fair value of the accounts.
(3) Accounts receivable-trade
The fair values of accounts receivable-trade, classified by each maturity, is based on the present value discounted by the interest rate that takes into account the maturity andthe credit risk. The fair value is classified as Level 2.
(4) Bonds
The fair value of listed stocks is based on the quoted price provided by the Japan Securities Dealers Association. Since the quoted price is not in active markets, the fair value
is classified as Level 2.
(5) Long-term debt (except bonds) and (6) Lease obligations
Fair values of long-term debt and lease obligations are based on the present value of the total principal and interest discounted by the interest rate that takes into account thematurity and the credit risk. The fair value is classified as Level 2.

25

Fuji Electric Report Financials 2023

Note 7. Securities
1. Other securities as of March 31, 2023 and 2022 were as follows:
Millions of yen

2023

Marketable securities classified as other securities
Equity securities
Debt securities
Others
Total

Cost

Carrying amounts

Unrealized gains¥ 18,002——¥ 18,002¥83,754——¥83,754¥ 65,761——¥ 65,761

Unrealized losses

¥

¥

(9)
—
—
(9)

Note: S ecurities with no quoted market price is not included in the preceding tables:
Unlisted stocks (Values in the consolidated balance sheets as of March 31, 2023 was ¥4,035 million.)

Millions of yen

2022

Marketable securities classified as other securities
Equity securities
Debt securities
Others
Total

Cost

Carrying amounts

Unrealized gains

Unrealized losses¥ 24,726——¥ 24,726¥ 99,698——¥ 99,698¥ 75,961——¥ 75,961¥ (989)——¥ (989)Note: S ecurities with no quoted market price is not included in the preceding tables:
Unlisted stocks (Values in the consolidated balance sheets as of March 31, 2022 was ¥4,062 million.)

Thousands of U.S. dollars (Note 3)2023

Marketable securities classified as other securities
Equity securities
Debt securities
Others
Total

Cost

Carrying amounts

Unrealized gains

Unrealized losses$ 135,356——$ 135,356$ 629,733——$ 629,733$ 494,444——$ 494,444$ (67)——$ (67)

Note: S ecurities with no quoted market price is not included in the preceding tables:
Unlisted stocks (Values in the consolidated balance sheets as of March 31, 2023 was $30,344 thousand.)2. Sales of other securities for the years ended March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Proceeds from sales
Gain on sales
Loss on sales

2023

2022

2023

¥ 15,053
9,064
(298)

¥ 16,388
9,627
(21)

$ 113,185
68,153(2,245)

3. Impairment of other securities for the years ended March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Impairment losses

2023

2022

2023

¥ 1,236¥ 239$ 9,294

Fuji Electric Report Financials 2023

26

Note 8. Derivatives
1. Derivative transactions to which hedge accounting is not applied
Millions of yen

2023
Contract amountForeign currency forward contracts:
Receivables:
U.S. dollar
Euro
Won
Baht
Payables:U.S. dollar
Yuan Renminbi
Yen
Total

¥

Contract amountover 1 year

Fair value

Unrealized
gain/loss

¥

688
2,329
155
1,488

¥ —
—
—
—

¥

(8)
(39)
1
(16)

341
4,988
49
¥ 10,038

—
—
—
¥ —

(0)
(177)
(0)
¥ (239)

(8)
(39)
1
(16)

(0)
(177)
(0)
¥ (239)Millions of yen

2022

Foreign currency forward contracts:
Receivables:
U.S. dollar
Euro
Won
Payables:U.S. dollar
YenAustralia Dollar
Total

Contract amountContract amountover 1 year

Fair value

Unrealized
gain/loss

¥ 678
1,787
286

¥ —
—
—

¥ (35)(77)(12)¥ (35)
(77)
(12)

259
1,956
27
¥ 4,993

—
—
—
¥ —

6
(34)
2
¥ (150)6(34)
2¥ (150)Thousands of U.S. dollars (Note 3)2023

Foreign currency forward contracts:
Receivables:
U.S. dollar
Euro
Won
Baht
Payables:U.S. dollar
Yuan Renminbi
Yen
Total

27

Fuji Electric Report Financials 2023

Contract amountContract amountover 1 year

Fair value

Unrealized
gain/loss$ 5,179
17,518
1,171
11,194

$ —
—
—
—

$

$

2,567
37,480370$ 75,479

—
—
—
$ —

(4)
(1,320)(2)$ (1,801)

(60)
(300)
10
(125)

(60)
(300)
10
(125)

(4)
(1,320)(2)$ (1,801)

2. Derivative transactions to which hedge accounting is applied
Currency-related contracts
Millions of yen

2023
Hedge accounting
methodType of derivative

Foreign currency forward contracts:
Receivables:
U.S. Dollar
Euro
Payables:Deferral hedge
methodU.S. Dollar
Euro
Baht
Singapore Dollar
Yuan Renminbi
Foreign currency forward contracts:
Receivables:
U.S. Dollar
Baht
Allocation method
Yuan Renminbi
Payables:U.S. Dollar
Yen
Total

Principal items hedged

Contract amountContract amountover 1 year

Fair value¥ 3,522
3,889

¥ 257
—

¥ (52)
(46)

550
2,726
612
176
7

—
987
—
—
—

0
451
(10)
5
0

Accounts receivable-trade

Accounts payable-trade

Accounts receivable-trade
¥

680
797
180

¥

—
—
—

Accounts payable-trade
227
4,142
¥ 17,508——¥ 1,244¥ 348

Millions of yen

2022
Hedge accounting
methodType of derivative

Foreign currency forward contracts:
Receivables:
U.S. Dollar
Euro
Deferral hedge
Payables:methodU.S. Dollar
Euro
Australia Dollar
Baht
Foreign currency forward contracts:
Receivables:
U.S. Dollar
Euro
Yuan Renminbi
Baht
Allocation method
Singapore Dollar
Payables:U.S. Dollar
Euro
Yen
Total

Principal items hedged

Contract amountContract amountover 1 year

Fair value

Accounts receivable-trade
¥

993
2,910

¥

—
—

¥

(4)
(10)

Accounts payable-trade
2,323
4,127
0
23

—
2,353
—
—

183
560
0
2

Accounts receivable-trade
¥

189
70
213
515
85

¥

—
—
—
—
—

(Note2)

Accounts payable-trade621
085¥ 12,154———¥ 2,353¥ 731

Fuji Electric Report Financials 2023

28

Thousands of U.S. dollars (Note 3)

2023
Hedge accounting
methodType of derivative

Foreign currency forward contracts:
Receivables:
U.S. Dollar
Euro
Payables:Deferral hedge
methodU.S. Dollar
Euro
Baht
Singapore Dollar
Yuan Renminbi
Foreign currency forward contracts:
Receivables:
U.S. Dollar
Baht
Allocation method
Yuan Renminbi
Payables:U.S. Dollar
Yen
Total

29

Fuji Electric Report Financials 2023

Principal items hedged

Contract amountContract amountover 1 year

Fair value$ 26,457
29,244$ 1,936—$ (391)
(349)

4,138
20,499
4,604
1,324
58

—
7,423
—
—
—

2
3,395
(79)
41
0

Accounts receivable-trade

Accounts payable-trade

Accounts receivable-trade
$

5,112
5,997
1,356

$

—
—
—

Accounts payable-trade
1,710
31,144$ 131,643——$ 9,359$ 2,619

Note 9. Short-term Debt and Long-term Debt
Short-term debt as of March 31, 2023 and 2022 consisted of the following:Thousands of
U.S. dollars (Note 3)

Millions of yen

Loans, principally from banks
Short-term debt

2023

2022

2023

¥ 9,099¥ 9,099¥ 14,691¥ 14,691$ 68,415$ 68,415

Note: The weighted average interest rates on short-term debt as of March 31, 2023 and 2022 were 4.09% and 1.92%, respectively.

Long-term debt as of March 31, 2023 and 2022 consisted of the following:Thousands of
U.S. dollars (Note 3)

Millions of yen

Loans, principally from banks and insurance companies
Bonds issued by the Company:
0.28% Yen unsecured straight bonds due August 31, 2023
0.40% Yen unsecured straight bonds due May 21, 2027
0.40% Yen unsecured straight bonds due May 25, 2028
Less: Portion due within one year
Long-term debt

2023

2022

2023

¥ 66,376¥ 96,569$ 499,068

15,00010,00010,000101,376
37,776¥ 63,600

15,00010,00010,000131,569
30,293¥ 101,276

112,781
75,18775,187762,226
284,031$ 478,195

Note: The weighted average interest rates on loans, principally from banks and insurance companies, as of March 31, 2023 and 2022 were 0.26% and 0.26%, respectively.

As of March 31, 2023, the aggregate annual maturities of long-term debt were as follows:
Years ending March 31,

Millions of yen

Thousands of
U.S. dollars (Note 3)

2025
2026
2027
2028
2029 thereafter
Total¥ 28,500
100—
10,00010,000¥ 48,600$ 214,288
751—
75,18775,187$ 365,413

Note 10. Lease Obligations
Lease obligations as of March 31, 2023 and 2022 consisted of the following:Thousands of
U.S. dollars (Note 3)

Millions of yen

2023

2022

2023

¥ 23,261
46,895¥ 70,156¥ 19,584
40,978¥ 60,562$ 174,900
352,597$ 527,497

Years ending March 31,

Millions of yen

Thousands of
U.S. dollars (Note 3)

2025
2026
2027
2028
2029 thereafter
Total¥ 16,630
12,578
9,473
5,573
2,641
¥ 46,895$ 125,039
94,57771,227
41,903
19,850$ 352,596

Short-termLong-term
Total

Note: The weighted average interest rates on lease obligations as of March 31, 2023 and 2022 were 2.23% and 2.01%, respectively.

As of March 31, 2023, the aggregate annual maturities of lease obligations were as follows:

Fuji Electric Report Financials 2023

30

Note 11. Retirement Benefits
1. Outline of retirement benefits for employees
The Company and most of its consolidated subsidiaries have
either funded or unfunded defined benefit plans and defined
contribution pension plans.
Defined benefit corporate pension plans are all funded andcover substantially all employees who are entitled to lump-sum or
annuity payments determined by reference to their basic rates of
pay and length of service. In addition, retirement benefit trust has
been established in certain pension plans.
Lump-sum payment plans are either unfunded or funded
as a result of establishing retirement benefit trust. They coversubstantially all employees who are entitled to lump-sum
payments determined by reference to either points obtained withinterest credits or their basic rates of pay and length of service.
Certain domestic consolidated subsidiaries adopted asimplified method in the calculation of net defined benefit liability
and retirement benefit expense. Certain domestic consolidated
subsidiaries have multi-employer corporate pension plansaccounted for by the same methods used for defined contribution
pension plans because they cannot reasonably calculate their
portion of pension assets corresponding to their contributions.

2. Information on defined benefit pension plans(1) The changes in the retirement benefit obligation except for plans accounted for by a simplified method during the years
ended March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Retirement benefit obligation at the beginning of the year
Service cost
Interest cost
Actuarial loss
Retirement benefits paid
Prior service cost
OthersRetirement benefit obligation at the end of the year

2023

2022

2023

¥ 169,152
3,015
2,263
277
(11,547)(37)
38¥ 163,161¥ 173,241
3,374
2,331
295
(11,826)
1,709
28¥ 169,152$ 1,271,822
22,67317,0202,083(86,821)(282)
283$ 1,226,778(2) T he changes in plan assets at fair value except for plans accounted for by a simplified method during the years ended
March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Plan assets at fair value at the beginning of the year
Expected return on plan assets
Actuarial gainContributions by the Companies
Retirement benefits paid
OthersPlan assets at fair value at the end of the year

2023

2022

2023

¥ 136,420
1,561(2,880)734(10,554)8¥ 125,289¥ 143,162
2,074
1,241
627
(10,689)5¥ 136,420$ 1,025,720
11,741(21,660)
5,522(79,357)
61$ 942,027(3) T he changes in defined benefit liability and asset calculated by a simplified method during the years ended March 31, 2023
and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Retirement benefit obligation at the beginning of the year
Defined benefit asset at the beginning of the year
Retirement benefit expenses
Retirement benefits paid
Contributions
OthersDefined benefit liability at the end of the year
Defined benefit asset at the end of the year

31

Fuji Electric Report Financials 2023

2023

2022

2023

¥ 2,447
(104)
333
(126)
(18)
23
¥ 2,564¥(9)¥ 2,211
(10)
324
(229)
(36)
83
¥ 2,447¥ (104)$ 18,404
(787)
2,510
(953)
(141)
181
$ 19,284$(70)

(4) T he reconciliation of retirement benefit obligation and plan assets at fair value with net defined benefit liability andnet defined benefit asset recognized in consolidated balance sheet were outlined as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

2023

2022

2023

Unfunded retirement benefit obligation
Net amount of liabilities and assets recognized in the consolidated balance sheet¥ 158,124(127,105)
31,0199,408¥ 40,427¥ 164,259(138,328)
25,931
9,143¥ 35,074$ 1,188,904(955,674)
233,230
70,734$ 303,964

Net defined benefit liability
Net defined benefit asset
Net amount of liabilities and assets recognized in the consolidated balance sheet

60,345(19,918)¥ 40,427

57,590(22,516)¥ 35,074$ 453,727$ (149,763)$ 303,964

Funded retirement benefit obligation
Plan assets at fair value

Note : Pension plans accounted for by a simplified method are included.

(5) The components of retirement benefit expenses for the years ended March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Service cost
Interest cost
Expected return on plan assets
Amortization of actuarial loss
Amortization of prior service cost
Retirement benefit expenses calculated by simplified method
OthersRetirement benefit expenses

2023

2022

2023

¥ 3,015
2,263(1,561)
(877)
(769)
333
109
¥ 2,513¥ 3,3742,331(2,074)
1,475
(774)
324
325
¥ 4,981$ 22,673
17,020(11,741)(6,597)(5,788)2,510
822$ 18,899(6) T he components of remeasurements of defined benefit plans included in other comprehensive income (before tax effect) for
the years ended March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Prior service cost
Actuarial gain and loss
Total

2023

2022

2023

¥ 732
4,044
¥ 4,776¥ 2,484(2,404)¥80$ 5,505
30,410$ 35,915(7) The components of remeasurements of defined benefit plans included in accumulated other comprehensive income (before
tax effect) as of March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Unrecognized prior service cost
Unrecognized actuarial gain and loss
Total

2023

2022

2023

¥ (2,538)
4,614¥ 2,076¥ (3,270)571¥ (2,699)$ (19,088)
34,703$ 15,615(8) The breakdown of plan assets by major category as of March 31, 2023 and 2022 were as follows:
Debt securities
Deposit
Equity securities
General accounts at life insurance companies
Others
Total

2023

2022

33%
20
18
29
0
100%

36%
21
19
23
1
100%

Note: R etirement benefit trust established for the corporate pension plans is included and equivalent to 9% of total amount of plan assets as of March 31, 2023 and 9% of total
amount of plan assets as of March 31, 2022.

The long-term expected rates of return on plan assets has been determined as a result of consideration of both the portfolio allocation
at present and in the future, and long-term rates of return from multiple plan assets at present and in the future.

Fuji Electric Report Financials 2023

32

(9) The assumptions used in accounting for the defined benefit plans as of March 31, 2023 and 2022 were as follows:
Discount rates
Long-term expected rates of return on plan assets
Expected rates of salary increase

2023

2022

0.27% – 1.40%
mainly 1.5%
0.0% – 5.1%

0.27% – 1.40%
mainly 2.0%
0.0% – 5.1%

3. Information on defined contribution pension plans
Contributions of defined contribution pension plans for the years ended March 31, 2023 and 2022 were ¥4,702 million ($35,360 thousand)and ¥4,786 million, respectively.

4. Information on multi-employer pension plans
Contributions to multi-employer welfare pension plans accounted for by the same methods used for defined contributions plans for theyears ended March 31, 2023 and 2022 were ¥14 million ($109 thousand) and ¥14 million, respectively.

Note 12. Shareholders’ Equity
1.Shares issued and outstanding / Treasury stock
The Companies Act of Japan provides that an amount equal to 10% of the amount to be disbursed as distributions of capital surplus(other than the capital reserve) and retained earnings (other than the legal reserve) be transferred to the capital reserve and the legal
reserve, respectively, until the sum of the capital reserve and the legal reserve equals 25% of the capital stock account. Such distributions
can be made at any time by resolution of the shareholders or by the Board of Directors if certain conditions are met.
Movements in shares outstanding and treasury stock during the years ended March 31, 2023 and 2022 were as follows:
Thousands of shares

Shares outstanding:Common stock
Total
Treasury stock:
Common stock
Total

March 31, 2022

Increasein the year

Decreasein the year

March 31, 2023

149,296
149,296————

149,296
149,296

6,461
6,461

1
1

0
0

6,462
6,462

Thousands of shares

Shares outstanding:Common stock
Total
Treasury stock:
Common stock
Total

March 31, 2021

Increasein the year

Decreasein the year

March 31, 2022

149,296
149,296————

149,296
149,296

6,457
6,457

3
3

0
0

6,461
6,461

The increases of treasury stock were due to purchase of shares of less than one voting unit and the decreases of treasury stock were
due to sales of shares at the request of shareholders who own less than one voting unit for the years ended March 31, 2023 and 2022.

2. Dividends(1) Dividends paid
For the year ended March 31, 2023
Resolution

Type ofsharesMeeting of the Board of
CommonDirectors on May 26, 2022
stock
Meeting of the Board of
CommonDirectors on October 27, 2022
stock

33

Fuji Electric Report Financials 2023

Total dividends(millions of yen)

Total dividends(thousands of
U.S. dollars (Note 3))

Dividends per
share (yen)Dividends per share(U.S. dollars (Note 3))¥ 7,855$ 59,067¥ 55.0$ 0.41

7,855

59,06755.0

0.41

Cut-off date

Effective date

March 31,
June 8,2022
2022
September 30, December 5,
2022
2022

For the year ended March 31, 2022
Type ofsharesResolution

Total dividends (millions of yen)

Meeting of the Board of
CommonDirectors on May 27, 2021
stock
Meeting of the Board of
CommonDirectors on October 28, 2021
stock

Dividends per share (yen)¥ 6,427

¥45.0

6,427

45.0

Cut-off date

Effective date

March 31,
June 9,2021
2021
September 30, December 2,
2021
2021

(2) Dividends with the cut-off date in the year ended March 31, 2022 and effective date in the year ending March 31, 2023
Type ofsharesResolution

Meeting of the Board of
Directors on May 25, 2023

Commonstock

Total dividends(millions of yen)

¥8,570Total dividends(thousands of
U.S. dollars (Note 3))

Source ofdividends$64,436

Retained
Earnings

Dividends per
share (yen)Dividends per share(U.S. dollars(Note 3))Cut-off date

¥60.0

$0.45

March 31,2023

Effective dateJune 7,2023

Dividends with the cut-off date in the year ended March 31, 2021 and effective date in the year ended March 31, 2022
Type ofsharesResolution

Meeting of the Board of
Directors on May 27, 2021

Commonstock

Total dividends (millions of yen)

Source ofdividends¥6,427Retained
Earnings

Dividends per share (yen)Cut-off date

Effective date

¥45.0

March 31,2021

June 9,2021

Note 13. Research and Development Costs
Research and development costs charged to income for the years ended March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Research and development costs

2023

2022

2023

¥36,216¥33,756$272,303

Note 14. Selling, General and Administrative Expenses
Major components of selling, general and administrative expenses for the years ended March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Salaries and wages
Retirement benefit expenses
Research and development costs

2023

2022

2023

¥86,542
3,552
31,081¥83,890
4,512
29,416$650,698
26,708233,695

Note 15. Extraordinary Income, Net
Extraordinary income, net, for the years ended March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Extraordinary income
Gain on sales of noncurrent assets
Gain on sales of investment securities
Extraordinary loss
Loss on disposal of noncurrent assets
Loss on devaluation of investment securities
Loss on sales of investment securities
Provision for loss on liquidation of subsidiaries and associates
Factory integration expenses
Loss on withdrawal from business
Extraordinary income (loss), net

2023

2022

2023

939
10,214¥ 179
10,358$ 7,060
76,808(569)(1,236)(298)(1,115)——¥ 7,935

(632)
(239)
—
—
(335)
(141)
¥ 9,190(4,281)(9,293)(2,245)(8,390)——$ 59,659¥

Fuji Electric Report Financials 2023

34

Note 16. Income Taxes
1. The components of income taxes for the years ended March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Current
DeferredIncome taxes

2023

2022

2023

¥ 26,318
794¥ 27,112¥ 21,846
2,085¥ 23,931$ 197,876
5,975$ 203,851

The Company and its domestic consolidated subsidiaries are subject to corporate income tax, prefectural and municipal inhabitants’taxes and enterprise tax, based on income.

2. The significant components of deferred tax assets and liabilities as of March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Deferred tax assets
Net defined benefit liability
Inventories
Accrued employees’ bonuses
Investment securities
Tangible fixed assets
Other
Gross deferred tax assets
Less: Valuation allowance
Total deferred tax assets
Deferred tax liabilities
Unrealized gain on other securities
Investment securities
Other
Gross deferred tax liabilities
Net deferred tax assets (liabilities)

2023

2022

2023

¥ 20,189
8,808
7,943
6,989
1,981
9,842
55,752(10,189)
45,563¥ 20,003
8,272
7,583
6,735
2,147
8,857
53,597(9,107)44,490$ 151,799
66,22759,72852,555
14,89573,989419,193(76,612)342,581(20,510)(1,124)(8,378)(30,012)¥ 15,551(23,444)(1,342)(7,998)(32,784)¥ 11,706(154,215)(8,457)(62,983)(225,655)$ 116,926

3. T he reconciliation between the statutory income tax rate and the effective income tax rate for the years ended
March 31, 2023 and 2022 were as follows:
Statutory income tax rate
Tax credits
Tax rate difference of overseas consolidated subsidiaries
Permanent difference resulting from non-taxable income, including dividends received
Permanent difference resulting from expenses not deductible for income tax purposes
Valuation allowance
Other
Effective income tax rate

2023

2022

30.6%
(3.7)
(3.0)
(0.3)
1.7
0.9
2.1
28.3%

30.6%
(3.2)
(3.1)
(0.3)
1.2
—
1.8
27.0%

4. The accounting for income tax, local corporate income tax and its tax effect accounting
The Company and some domestic consolidated subsidiaries applied the Group Tax Sharing System from the beginning of the current
fiscal year. Also, the Company and some domestic consolidated subsidiaries account and disclose income tax, local corporate income
tax and its tax effect in accordance with the “Accounting and Disclosure Under the Group Tax Sharing System” (Practical Solution No.42
issued on August 12, 2021).

35

Fuji Electric Report Financials 2023

Note 17. Consolidated Statements of Comprehensive Income
Amounts reclassified to profit (loss) in the current period that were recognized in other comprehensive income in the current or previous
periods and the tax effects for each component of other comprehensive income were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Valuation difference on available-for-sale securities:
Amount arising during the year
Reclassification adjustments
Before tax effectTax effect
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges:
Amount arising during the year
Before tax effectTax effect
Deferred gains or losses on hedges
Foreign currency translation adjustments:
Amount arising during the year
Reclassification adjustments
Before tax effectTax effectForeign currency translation adjustments
Remeasurements of defined benefit plans:
Amount arising during the year
Reclassification adjustments
Before tax effectTax effectRemeasurements of defined benefit plans
Share of other comprehensive income of associates accounted for using equity method:Amount arising during the year
Reclassification adjustments
Share of other comprehensive income of associates accounted for using equity
methodTotal other comprehensive income

2023

2022

2023

¥ (1,070)(8,128)(9,198)2,996(6,202)¥ 3,627(9,504)(5,877)
1,655(4,222)$ (8,048)(61,116)(69,164)
22,528(46,636)

(382)
(382)
117
(265)

266
266
(81)
185

(2,879)(2,879)882(1,997)

8,175
24
8,199
(24)
8,175

13,959—13,95924
13,983

61,470177
61,648(170)
61,478(3,130)(1,646)(4,776)
1,497(3,279)

(781)
701
(80)
43
(37)

(23,541)(12,374)(35,915)
11,257(24,658)

(18)
72

(56)
76

(136)
546

54
¥ (1,517)20¥ 9,929410$ (11,403)

Note 18. Contingent Liabilities
Contingent liabilities as of March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Guarantees

2023

2022

2023

¥ 4,067¥ 4,733$ 30,586

Fuji Electric Report Financials 2023

36

Note 19. Leases
1. Finance lease transactions(1) Leased assets
Leased assets primarily consist of machinery and equipment and software.
(2) Depreciation method for leased assets
Depreciation method for leased assets is as stated in “f. Depreciation, 2) Leased assets” in “Note 2. Summary of Significant
Accounting Policies.”

2. Operating lease transactions
The minimum rental commitments under noncancellable operating leases as of March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Due within one year
Due after one year
Total

2023

2022

2023

¥ 2,376
4,570¥ 6,946¥ 2,350
6,275¥ 8,625$ 17,867
34,363$ 52,230

Note 20. Revenue Recognition
1. Disaggregation of revenue
Disaggregation of revenue by geographical region for the year ended March 31, 2023 and 2022 were as follows:
Millions of yen

Year ended March 31, 2023

Japan
Asia and other areas
China
EuropeAmerica
Revenue from contracts
with customers

PowerElectronics
EnergyPower
Electronics
Industry

Semiconductors

Power
Generation

Food andBeverageDistribution

Others¥181,920
61,93912,921
1,334
5,964¥278,337
36,26919,684
9,105
10,054¥101,704
26,22851,891
22,271
4,134¥64,851
18,404
231
408
3,442

¥91,095
1,395
2,021
—
746

¥54,335 ¥ 772,242
1,891
146,126
3,509
90,257
2
33,12054
24,394¥(54,852) ¥ 717,390(884)
145,242(905)
89,352(1)
33,119(50)
24,344¥264,078¥353,449¥206,228¥87,336¥95,257¥59,791 ¥ 1,066,139¥(56,692) ¥ 1,009,447

PowerElectronics
EnergyPower
Electronics
Industry

Semiconductors

Power
Generation

Food andBeverageDistribution

OthersSubtotal

Adjustments

Total¥164,304
46,971
15,649436
3,611¥255,720
29,711
24,621
7,091
7,006¥ 81,596
26,32154,564
12,324
4,002¥64,531
11,535
232
118
2,147

¥85,647
1,344
3,523
—
269

¥49,918
1,717
3,052
2
22

¥701,716
117,599
101,641
19,971
17,057¥(45,895)(749)(1,106)0(8)¥655,821
116,850
100,535
19,971
17,049¥230,971¥324,149¥ 178,807¥78,563¥90,783¥54,711¥957,984¥(47,758)¥910,226

Power
Electronics
EnergyPower
Electronics
Industry

Subtotal

Adjustments

Total

Subtotal

Adjustments

Total

Millions of yen

Year ended March 31, 2022

Japan
Asia and other areas
China
EuropeAmerica
Revenue from contracts
with customers

Thousands of U.S. dollars (Note 3)

Year ended March 31, 2023

Japan
Asia and other areas
China
EuropeAmerica
Revenue from contracts
with customers

Power
Generation

Food andBeverageDistribution

Others$1,367,820 $2,092,761 $ 764,694
465,696
272,692
197,197
97,156
148,001
390,164
10,032
68,462
167,455
44,84775,59531,083$487,602
138,374
1,737
3,072
25,880$684,930
10,47815,200—5,615$408,530 $5,806,337
14,246 1,098,683
26,370678,6282
249,023398
183,418$(412,427) $5,393,910(6,652) 1,092,031(6,805)
671,823(1)
249,022(376)
183,042$1,985,551 $2,657,511 $ 1,550,593$656,665$716,223$449,546 $8,016,089$(426,261) $7,589,828

Semiconductors

Notes: O thers segment consisted of business segments not attributable to reporting segments and included financial services, real estate operations, insurance agency services,travel agency services, printing and information services, etc.

37

Fuji Electric Report Financials 2023

2. Foundational information to understand revenue
The Companies account for revenue in accordance with l.
Recognition for Revenue and Costs in “Note 2. Summary of
Significant Accounting Policies.” The Companies’ methods forrecognition of revenue for goods and services in each segment
are as follows:
The Companies are engaged in a wide range of businessactivities, such as product development, production, sales, andservices.
The Companies combine two or more contracts entered intoat or near the same time with the same customer and account forthe contracts as a single contract if one or more of the following
criteria are met:a) The contracts are negotiated as a package with a single
commercial objective.
b) The amount of consideration to be paid in one contract
depends on the price or performance of the other contract.
c) T he goods or services promised in the contracts are a single
performance obligation.
When a contract is modified in the scope or price (or both)of a contract that is approved by the parties to the contract, theCompanies assess whether the contract modification is a separate
contract or as if it were a part of the existing contract.
When a contract includes two or more goods or services, theCompanies identify whether or not the performance obligation is
distinct and determine accounting units.
If the Companies act as an agent to arrange for goods orservices to be provided by the other party, the Companies
recognize revenue in the net amount of consideration that theentity retains after paying the other party the consideration
received in exchange for the goods or services to be provided bythat party.
The Companies assess the transaction price in an amountof consideration to which the Companies expect to be entitledin exchange for transferring the goods or services. If an amountof consideration varies, the Companies estimate the amount asa variable consideration and include it in the transaction price.
The Companies include in the transaction price some or all of
an amount of variable consideration only to the extent that it
is highly probable that a significant reversal in the amount of
cumulative revenue recognized will not occur when the uncertainty
associated with the variable consideration is subsequently resolved.
The Companies deduct rebates to be paid to a customer fromrevenue.
The Companies allocate the transaction price toeach performance obligation on a relative stand-alone selling pricebasis. If a stand-alone selling price is not directly observable, theCompanies estimate the stand-alone selling price by forecasting
its expected costs of satisfying a performance obligation and thenadding an appropriate margin for that good or service.
The Companies recognize revenue when (or as) the
performance obligation is satisfied by transferring a promised
good or service to a customer. The Companies determine
at contract inception whether the Companies satisfy theperformance obligation over time or satisfy the performanceobligation at a point in time. The Companies satisfy a performanceobligation and recognize revenue over time, if one of the following
criteria are met.

a) The customer simultaneously receives and consumes thebenefits provided by the Companies’ performance as theCompanies perform.
b) The Companies’ performance creates or enhances an asset
that the customer controls as the asset is created or enhanced.
c) T he Companies’ performance does not create an asset withan alternative use to the Companies and the Companies havean enforceable right to payment for performance completed
to date.
If the above criteria are not met, the Companies recognize
revenue at a point in time when the goods of services aretransferred to a customer and the performance obligation issatisfied.
(1) Sales of standard goods
The Companies are engaged in sales goods and construction
contracts such as power distribution and control equipment inPower Electronics Energy segment, inverters, FA components,
measuring instruments and sensors in Power Electronics
Industry segment, power semiconductors for industrial andvehicles in Semiconductors segment and beverage vending
machines, vending machines for food and other goods, store
equipment and currency handling equipment in Food andBeverage Distribution segment.
For these transactions, control of goods is transferred to acustomers at a point in time.
For domestic sales, the Companies recognize revenue upon
shipment because the period between shipment and transfer ofcontrol of goods to customer is a normal period. (Application ofshipping standards)
For domestic sales for which shipping standards are notapplied, the Companies recognize revenue upon delivery of goods
to a customer.
For export transactions, the Companies recognize revenue
upon delivery of goods to a customer specified in the trade terms.
(2) Sales of job-order production goods and contract works
The Companies are engaged in sales for goods and construction
contracts such as substations, energy management systems,
uninterruptible power systems(UPSs) and switchboards In thePower Electronics Energy segment, FA systems, drive control
systems, measuring and control systems, transport systems,
ship and harbor systems, radiation monitoring systems, electricity
construction, air conditioning equipment construction, andICT equipment and software In Power Electronics Industry
segment and geothermal power generation, hydroelectric power
generation, solar power generation, wind power generation, fuelcells, thermal power generation and nuclear power generationequipments in Power Generation segment.
For these transactions, the Companies apply the method thatrevenue is recognized over time by measuring progress toward
complete satisfaction of performance obligations because its
performance obligations are satisfied over time (the cost-based
input method is used in measuring the progress).

Fuji Electric Report Financials 2023

38

(3) Rendering of services
The companies are engaged in services such as maintenance,
inspection, repair, remodeling, and operation maintenance andmanagement, related to (1) and (2).
For these transactions, the Companies apply the method thatrevenue is recognized over time based on the estimate of progress
toward complete satisfaction of performance obligations because
its performance obligations are satisfied over time (the cost-based
input method is used in measuring the progress).
For maintenance contracts, etc., in which services are renderedto customers evenly over the contract period, the Companies
recognize revenue on a straight-line basis over the contract period.
There is no significant financing component because theCompanies expect, at contract inception, that the period between
when the Companies transfer promised goods or services to acustomer and when the customer pays for that goods or services
will be one year or less.

3. I nformation to understand the amount of revenue forthe current and subsequent fiscal year
(1) Contract assets and contract liabilities
Contract assets are the Companies’ right to considerationin exchange for goods or services that the Companies havetransferred to customers. Contract assets are transferred toaccounts receivable-trade when the right to consideration
become unconditional.
Contract liabilities are the Companies’ obligation to transfer
goods or services to customers for which the Companies havereceived consideration or the amount is due from the customers.
Notes for the ending balance of the notes receivable-trade,
accounts receivable-trade and contract assets are omitted
because these balances are separately presented in the

39

Fuji Electric Report Financials 2023

consolidated balance sheet.
Revenue recognized in current fiscal year that was included in
the contract liability balance for the years ended March 31, 2023
and 2022 were ¥29,024 million ($218,227 thousand) and ¥20,377
million, respectively.
In addition, revenue recognized in the current fiscal year
from performance obligations satisfied(or partially satisfied) in theprevious periods is immaterial.
(2) T ransaction price allocated to the remaining performanceobligations
The aggregate amount of transaction price allocated to theperformance obligations that are unsatisfied (or partiallyunsatisfied) for the years ended March 31, 2023 and 2022 were¥424,692 million ($3,193,179 thousand) and ¥324,578 million,
respectively. Of this amount, Power Electronics Energy, PowerElectronics Industry and Power Generation have contracts thatrecognize revenue over time.
The unsatisfied performance obligations by segments are
expected to be satisfied approximately within the following periods.
Power Electronics Energy:	within 2 years(within 3 years in previous fiscal year)
Power Electronics Industry:	within 3 years(within 4 years in previous fiscal year)
Power Generation:	within 5 years(within 6 years in previous fiscal year)
Regarding to the note for the “(2) Transaction price allocatedto the remaining performance obligations,” the Companies
applied the practical expedient and did not include contracts
that have an original expected duration of one year or less.
In addition, the above amounts do not include the material
estimates of variable consideration.

Note 21. Segment Information
1. Segment information(1) Outline of reporting segments
The Companies’ reporting segments are components for which
separate financial information is available and whose operating
results are reviewed regularly by the Board of Directors of theCompany in order to make decisions about resource allocationand to assess performance. The Company has businessheadquarters by products and services at its head office.
The business headquarters prepare comprehensively global
strategies related to their products and services and control theirbusiness activities.
Accordingly, the Companies have the following five reporting
segments, principally based on the business headquarters,that take into account the similarity of category and natureof products and services: Power Electronics Energy, PowerElectronics Industry, Semiconductors, Power Generation, andFood and Beverage Distribution. These segments except for
Semiconductors and Power Generation consist of 2 or morebusiness segments.
Also, business segments have been changed in PowerElectronics Energy and Power Electronics Industry due to theorganaizational change.
The segments information of previous fiscal year has beenreported on the basis of the reporting segment that this change
has been reflected.

Main products and services of each reporting segment consist of the following:
Reporting segments

Main products and services

Power Electronics Energy

Substations, energy management systems, uninterruptible power systems(UPSs), switchboards,
power distribution and control equipment

Power Electronics Industry

Inverters, FA components, measuring instruments, sensors, FA systems, drive control systems,
measuring and control systems, transport systems, ship and harbor systems, radiation
monitoring systems, electricity construction, air conditioning equipment construction, ICT
equipment and software

Semiconductors

Power semiconductors for industrial and vehicles

Power Generation

Geothermal power generation, hydroelectric power generation, solar power generation, wind
power generation, fuel cells, thermal power generation, nuclear power-related equipment

Food and Beverage Distribution

Beverage vending machines, vending machines for food and other goods, store equipment,
currency handling equipment(2) Calculation method of net sales, profit or loss, assets, liabilities and other items on each reporting segment
The accounting policies applied by each reporting segment are consistent with those described in “Note 2. Summary of Significant
Accounting Policies.” Segment profit or loss presented in segment information is based on operating profit in the consolidated statements
of income. Intersegment sales and transfer are determined by market value.

Fuji Electric Report Financials 2023

40

(3) Information on net sales, profit or loss, assets, liabilities and other items by each reporting segment
Reporting segment information for the years ended March 31, 2023 and 2022 were as follows:
Millions of yen

Year ended March 31, 2023

Sales, profits or losses
and assets by reporting
segments
Net sales
Sales to third parties
Inter-segment sales andtransfers
Total sales
Segment profits (losses)
Segment assets
Other items
Depreciation andamortization
Investments for companies
applied equity method
Capital expenditures

Power
Electronics
EnergyPower
Electronics
Industry

Semiconductors

Power
Generation

Food andBeverageDistribution

OthersTotal¥ 258,936¥ 333,704¥ 201,581¥ 87,169¥ 94,274¥ 33,783

5,142
264,078¥ 26,884¥ 241,043

19,745353,449¥ 24,882¥ 322,828

4,647
206,228¥ 32,186¥ 314,704

167
87,336¥ 3,550¥ 79,430

983
95,257¥ 4,350¥ 73,470

¥

5,746

¥

7,536

¥ 27,146¥ 1,299¥ 10,821¥ 7,983

¥
¥

1,812
9,706

¥
—
¥ 72,657¥—¥ 1,230

Power
Electronics
EnergyPower
Electronics
Industry¥ 227,415

Adjustments

Consolidated¥ 1,009,447¥¥ 1,009,447

26,00859,791¥ 3,752¥ 35,954

56,692
1,066,139¥ 95,604¥ 1,067,429(56,692)—(56,692) 1,009,447¥ (6,722) ¥ 88,882¥ 114,123 ¥ 1,181,552¥ 2,131¥893¥

44,751

¥

1,187

¥

45,938¥—¥ 2,191

¥
¥

—
571

¥
¥

12,633
94,338

¥
¥

—
2,021

¥
¥

12,63396,359Adjustments

Consolidated¥ 910,226—

Millions of yen

Year ended March 31, 2022

Sales, profits or losses
and assets by reporting
segments
Net sales
Sales to third parties
Inter-segment sales andtransfers
Total sales
Segment profits (losses)
Segment assets
Other items
Depreciation andamortization
Investments for companies
applied equity method
Capital expenditures

41

Semiconductors

Power
Generation

Food andBeverageDistribution

OthersTotal¥ 308,625¥ 174,249¥ 78,487¥ 90,191¥ 31,259¥ 910,226¥

3,556
230,971¥ 21,217¥ 212,671

15,524
324,149¥ 23,823¥ 310,254

4,558
178,807¥ 27,136¥ 267,172

76
78,563¥ 3,124¥ 79,490

592
90,783¥ 3,007¥ 75,047

23,45254,711¥ 2,839¥ 35,034

47,758
957,984¥ 81,146¥ 979,668(47,758)—(47,758)
910,226¥ (6,311) ¥ 74,835¥ 137,444 ¥ 1,117,112

¥

¥

7,647

¥ 20,827¥ 1,291¥ 2,537¥904¥ 38,874

¥

1,095

¥

39,969¥ 1,851¥ 10,486¥—¥ 39,543¥—¥ 1,047¥—¥ 1,149

¥
¥

—
624

¥ 13,894¥ 58,367

¥
¥

—
1,680

¥
¥

13,89460,047

5,668¥ 12,043¥ 5,518

Fuji Electric Report Financials 2023—

Thousands of U.S. dollars (Note 3)
PowerElectronics
EnergySemiconductors

Power
Generation

Food andBeverageDistribution

Others$ 1,946,890 $ 2,509,059 $ 1,515,647$ 655,407$ 708,833$ 253,993$ 7,589,829 $

38,662
148,452
34,946
1,985,552 2,657,511 1,550,593$ 202,137 $ 187,089 $ 242,006$ 1,812,356 $ 2,427,279 $ 2,366,196

1,258
656,665$ 26,697$ 597,219

7,391
716,224$ 32,708$ 552,412

195,552
449,545$ 28,194$ 270,327

426,261 (426,261)—
8,016,090 (426,261) 7,589,829$ 718,831 $ (50,544) $ 668,287$ 8,025,789 $ 858,061 $ 8,883,850$

43,204 $56,664 $ 204,105

$

9,772

$ 16,029$

6,720$ 336,494 $8,907$ 345,401$$

81,362 $60,029 $

13,629 $—72,979 $ 546,296

$
$

—
9,250

$
—
$ 16,475

$
$

—
4,282

$ 94,991 $—$ 709,311 $ 15,197$ 94,991$ 724,508

Year ended March 31, 2023

Sales, profits or losses
and assets by reporting
segments
Net sales
Sales to third parties
Inter-segment sales andtransfers
Total sales
Segment profits (losses)
Segment assets
Other items
Depreciation andamortization
Investments for companies
applied equity method
Capital expenditures

Power
Electronics
Industry

Total

Adjustments

Consolidated—$ 7,589,829

Notes: 1. O thers segment consisted of business segments not attributable to reporting segments and included financial services, real estate operations, insurance agency services,travel agency services, printing and information services, etc.
2. The adjustments for segment information above were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Corporate expense*
Elimination of intersegment sales
Total

2023

2022

2023

¥ (6,730)¥ (6,270)$ (50,607)

8

(41)

63

¥ (6,722)¥ (6,311)$ (50,544)* Corporate expense mainly consisted of administration cost of the Company.
Thousands of
U.S. dollars (Note 3)

Millions of yen

Corporate assets*
Elimination of intersegment transactions
Total

2023

2022

2023

¥ 299,458¥ 288,299$ 2,251,564(185,337)(150,855)¥ 114,121¥ 137,444(1,393,504)$

858,060* Corporate assets mainly consisted of invested cash surpluses (cash and cash equivalents), long-term invested assets (investment securities), assets relating toadministration department and assets of a financing subsidiary company.
3. Segment profits (losses) were reconciled to operating profit (loss) in the consolidated statements of income.

Fuji Electric Report Financials 2023

42

2. Related Information
Related information for the years ended March 31, 2023 and 2022 were as follows:
Geographic information(a) Sales
Thousands of
U.S. dollars (Note 3)

Millions of yen

Japan
Asia (except for China), Others
China
EuropeAmerica
Consolidated

2023

2022

2023

¥ 717,390
145,242
89,352
33,11924,344¥ 1,009,447¥ 655,821
116,850
100,535
19,971
17,049¥ 910,226$ 5,393,910
1,092,031
671,823
249,022
183,042$ 7,589,828

Note: Net sales information above is based on customer location.

(b) Tangible fixed assets
Thousands of
U.S. dollars (Note 3)

Millions of yen

Japan
Asia (except for China), Others
China
EuropeAmerica
Consolidated

2023

2022

2023

¥ 217,360
47,985
16,798606
1,163¥ 283,912¥ 191,526
24,085
16,779612
673¥ 233,675$ 1,634,292
360,778
126,303
4,559
8,749$ 2,134,681

3. Information on impairment loss of fixed assets by each reporting segment
None

4. Information on amortization of goodwill and unamortized balance by each reporting segment
Information on amortization of goodwill and unamortized balance by each reporting segment for the year ended March 31, 2023 and2022 were as follows:
Millions of yen

Year ended March 31, 2023

Power Electronics
EnergyPower Electronics
Industry

Semiconductors

Power Generation

Food and Beverage
Distribution

OthersConsolidated

Amortization
Balance as of March 31

¥—
¥—

¥ 823
¥ 5,152

¥ 12
¥ 28

¥—
¥—

¥—
¥—

¥—
¥—

¥ 835
¥ 5,180

Year ended March 31, 2022

Power Electronics
EnergyPower Electronics
Industry

Semiconductors

Power Generation

Food and Beverage
Distribution

OthersConsolidated

Amortization
Balance as of March 31

¥—
¥—

¥ 817
¥ 5,934

¥ 11
¥ 38

¥—
¥—

¥—
¥—

¥—
¥—

¥ 828
¥ 5,972

Year ended March 31, 2023

Power Electronics
EnergyPower Electronics
Industry

Semiconductors

Power Generation

Food and Beverage
Distribution

OthersConsolidated

Amortization
Balance as of March 31$—$—$ 6,189$ 38,737

$ 89
$ 216

$—
$—

$—
$—

$—
$—

$ 6,278$ 38,953

Millions of yen

Thousands of U.S. dollars (Note 3)

5. Information on gain on negative goodwill by each reporting segment
None

43

Fuji Electric Report Financials 2023

Note 22. Information on Transactions with Related Parties
For the year ended March 31, 2023
None

Note 23. Business Combinations
For the year ended March 31, 2023
This disclosure is omitted due to the immateriality.

Note 24. Asset Retirement Obligations
Asset retirement obligations recorded on the consolidated balance sheets
1. Outline of asset retirement obligations
The Companies record asset retirement obligations related to the expenses for removing asbestos from company-owned buildings
upon their dismantlement and the obligations to restore head offices, sales offices and other premises to their original condition upon
termination of their lease contracts.
Regarding some of the obligations to restore head offices, sales offices and other premises to their original condition, the Companies
estimate nonrecoverable amounts of deposits for those premises and record the portion attributable to the current fiscal year as
expenses, instead of recording asset retirement obligations.

2. Calculation method of asset retirement obligations
In calculating the amounts of asset retirement obligations, the Companies estimate a period of use between 9 and 49 years and use a
discount rate equivalent to the interest rate of government bonds corresponding to the use period (0.03% to 2.3%).

3. Changes in the total amounts of asset retirement obligations
Changes in the total amounts of asset retirement obligations for the years ended March 31, 2023 and 2022 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Balance at the beginning of the year
Increase due to acquisition of tangible fixed assets
Change in estimate
Adjustment due to passage of time
Decrease due to fulfillment of obligations
Balance at the end of the year

2023

2022

2023

¥ 2,5233—
6(9)¥ 2,523¥ 1,900
—
642
6
(25)
¥ 2,523$ 18,973
26
—
50
(76)
$ 18,973

Note 25. Amounts Per ShareInformation on amounts per share for the years ended March 31, 2023 and 2022 was as follows:Yen

Net assets per share
Profit per share

U.S. dollars (Note 3)

2023

2022

2023

¥ 3,620.23
429.50¥ 3,310.80
410.68$ 27.220
3.229

Note: Diluted profit per share in 2023 and 2022 is not disclosed because there is no potential common stock that has a dilutive effect.

Fuji Electric Report Financials 2023

44

Independent Auditor’s Report

45

Fuji Electric Report Financials 2023

Fuji Electric Report Financials 2023

46

47

Fuji Electric Report Financials 2023

Fuji Electric Report Financials 2023

48

49

Fuji Electric Report Financials 2023

Fuji Electric Report Financials 2023

50

Gate City Ohsaki, East Tower,
11-2, Osaki 1-chome, Shinagawa-ku, Tokyo 141-0032, Japan
Contacts: Public and Investor Relations Dept.
TEL: +81-3-5435-7111 www.fujielectric.com/

00A9-E-0015e Published in Japan 2023.9