Alpha-Win Company Research Report
PCA(9629 TSE Prime)● SummaryIssued: 12/19/2022

Alpha-Win Capital Inc. Research Department
http://www.awincap.com/

Business Description
・ PCA CORPORATION (hereinafter, the “Company”) is an independent software manufacturer specialized inpackaged enterprise system software. It is a major specialized player in the industry.
・The Company was founded in 1980. Since then, it has been providing on-premises or cloud-based software mainly
to small/medium-sized companies. The Company’s mission is to contribute to society as a “Management Support
Company” that supports other companies in conducting smooth management and operation, with a focus onproviding enterprise system software that realizes high-level automatization.

Financial Results For the First Half and Forecast for the Second Half and the Full Year・In the first half of this fiscal year (FY 2023; note that the Company’s fiscal year is March-ending, i.e., FY 2023 ends
in March 2023 and its first half ended in September 2022), the Company posted declines in sales and profits due to a
fallback from the demand related to the PCA X series whose support was ended in the previous fiscal year. Sales
were Y6,163 million (-6.7% YoY), operating profit was Y847 million (-51.7% YoY), and net profit was Y494 million(-65.9% YoY).
・The Company did not announce its forecast for the first half, but it appears that the profits exceeded its internal
forecasts. Progress in the first half in terms of the Company’s full-year plan was 47.7% for sales, 77.0% for operating
profit, and 77.3% for net profit, indicating a large progress in terms of profit.
・The Company has maintained its forecasts for the current fiscal year (FY 2023): sales of Y12,927 million, operating
profit of Y1,100 million, and net profit of Y639 million. In the full fiscal year, too, the Company expects a 3.4%
decline in sales and a large, 58.6% decline in operating profit due to a fallback from the event-driven high demandfor its products and due to upfront investments including those for PCA Hub. In addition, since the gain on sales of
securities that was recorded in the previous fiscal year will no longer be present, it expects a 73.0% decline in net
profit.
・During the past fallback period following an event-driven high demand (FY 2015), sales and profits fell significantly
and a net loss was posted. This fiscal year, though, such a drop is expected to be largely prevented thanks to thestrategic shift of the business portfolio to the subscription-based businesses (maintenance + cloud service), whichhave high continuity and stability. Therefore, although profits are expected to decrease significantly, the Company
expects that it will be able to absorb its upfront investment costs and maintain the operating profit at greater than Y1billion.
・Subtracting the first-half results from the full-year plan shows that the Company is expecting second-half sales ofY6,764 million (-0.1% YoY), operating profit of Y253 million (-72.0% YoY), and net profit of Y145 million (-84.3%
YoY). While sales are expected to remain flat, the Company expects a significant decline in profits due to its planned,
significant increase in development costs, which will cause the profit margins to worsen.

Alpha-Win Research Department’s Forecast of Financial Results
・For this fiscal year, we had forecasted sales of Y12,950 million (+Y23 million compared to the Company’s forecast),
operating profit of Y1,300 million (similarly, +Y200 million), and net profit of Y700 million (similarly, +Y61
million). We had expected slight upward revisions to both sales and profit compared to the Company’s plan. In ourcurrent forecast, though, we have kept our sales forecast the same, but have revised our forecast for operating profit
upward by Y100 million to Y1,400 million and, similarly, revised net profit upward by Y100 million to Y800 million.
Along with these revisions, we have also raised our forecast for dividend per share from 13.0 yen to 16.0 yen.
・The sluggish sales of the products and the increase in costs such as R&D investments and personnel expenses arepoints of concern. However, there was a large progress with the profits in the first half, the impact from the eventdriven high demand should become relaxed in the second half since the demand occurred mainly in the first half ofthe previous fiscal year, and the cloud business is solid as it is practically maintaining a 20% sales growth rate. The
Company’s estimates of second-half costs and profits also seem conservative. We have prepared our current forecast
based on these factors.

1/41This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate, or fit
for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting from the use ofor reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual property of thisReport belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022

・From the next fiscal year onward, assuming that economic activities will gradually normalize as the global economy
stabilizes and the COVID-19 situation settles down, we predict that the Company will return to a sales and profit
growth trend as its upfront investments peak out, the impact of the fallback from the event-driven high demand
diminishes, and the cloud business grows.
・Currently, high demand is not expected from the Electronic Books Maintenance Act and the new invoicing system,and their impact on financial performance is expected to be limited. We have left our forecasts for the next fiscal
year and the year after that unchanged, but have changed the proportions of total sales for the cloud and the solutions(overall sales forecast is the same) and have raised only the dividend forecast based on the forecasts for this fiscal
year. We have not changed our prediction that the annual profit growth rate over the medium term (on a normalizedbasis excluding event-driven high demand) will be 8-10%, with the cloud business continuing to support its growth.
Competitiveness・The Company has a customer base of approx. 240,000 companies. It has a high brand recognition and top-levelmarket share in accounting and finance software targeting small/medium-sized companies. It is especially taking alead in cloud-based enterprise system software in those fields and is the top player in the market.
・Its strength is its concentration of resources in its field of expertise as a specialist to develop products and services
that meet various customer needs, including those related to changes in tax and other regulations, ahead of its
competitors. It also has a stable customer base and can provide high-quality products and services at reasonable prices.
Business Strategy
・The Company has announced the medium-term management plan for the three years starting this fiscal year.
Numerical targets for the final year or FY 2025 are as follows: sales of Y15 billion or more (of which, subscriptionbased sales are Y9.5 billion or more), consolidated operating profit of Y2.5 billion or more (profit margin of 16% ormore), ROE of 10% or more, DOE of 2.5%, and dividend payout ratio of 30%. Excluding sales, these figures havebeen achieved during past periods of event-driven high demand and could potentially be achieved again, but they
seem to be somewhat high goals unless a certain scale of M&A or an event-driven high demand occurs.
・The PCA Group’s growth strategy is to provide total solution services centered on software. It will execute fourpriority measures (establishing a strong revenue base for the core businesses; creating new business opportunities;
strengthening monozukuri or the creation of things with a focus on safety, security, and anticipation of needs; andestablishing a highly profitable and sustainable management foundation). Basically succeeding the previous mediumterm plan while responding to digitalization needs, it will also proactively work on the SDGs.
・On the other hand, its biggest challenges are to effectively utilize its abundant cash & deposits (which exceed its
annual sales) for future growth and to develop the new businesses that it has started (PCA Hub, HR business, PCA
Subscription, hyper, etc.) to put them onto a growth trajectory and monetize them.

Stock Characteristics and Price・A defensive, domestic-demand-oriented, and small-cap growth stock that is positively influenced by the transition toa subscription-based business model, the work-style reform, and tax reforms. Volatility of business performance andstock price tends to rise before and after event-driven high demands.
・Compared to the average value of all companies listed on the TSE Prime, the valuation of the Company’s stock seems
to be overpriced in terms of P/B (based on the previous fiscal year’s results) and the expected P/E and dividend yield(based on the current fiscal year’s forecasts).
・However, the following could be expected of the Company: potential upward revision of its forecasted profit for thisfiscal year, a greater return of profit to shareholders over the medium to long term, stability and high continuity of its
mainly subscription-based business, and the high growth potential of its subscription business leading to a return toa sales and profit growth trend starting next fiscal year with this fiscal year’s results as a temporary low. Since theprofit growth will most probably cause the P/E to decrease, we believe there is an upside to the stock price over the
medium to long term.
・The stock price had been corrected in advance for this fiscal year’s worsened financial performance. However, thestock price has then turned around and has been outperforming major indices such as the TOPIX and TSE Prime, as
well as its competitors, due to its characteristic as a defensive stock which is not affected by the macro environment
and the large progress with profit in its announced first-half results.
2/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate, or fit
for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting from the use ofor reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual property of thisReport belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)
Issued: 12/19/2022
・ For the time being, stock price will likely be affected by whether the new businesses (mainly PCA Hub andDreamhop) will succeed, the growth rate of the cloud business, and whether there will be changes in the tax system
and accounting system.

Return of Profit to Shareholders
・The Company has been consistently and stably paying dividends and has been buying back its shares. In FY 2023,
there will no longer be a special, commemorative dividend of 11 yen/share like the previous fiscal year, and it plans
to continue to pay an annual ordinary dividend of 13 yen/share (stock split reflected).
・The dividend yield is expected to be about 1% based on the current fiscal year’s forecasts. Based on the Company’s
financial forecast for this fiscal year, the dividend payout ratio is expected to be 40.7%, which is above the Company's
target of 33%. We expect the DOE, though, to be about 1.5%, which is again below its target of 2.5%.
・In the short term, with this fiscal year’s results as the bottom, the Company’s financial performance is expected torecover starting in the next fiscal year. Therefore, it is expected to further strengthen the return of profit toshareholders, including dividend hikes, share buybacks, stock splits, and cancellation of treasury shares.
! 9629 PCA

Sector: Information & Communication " Figure A

FY
2019
2020
2021
2022
2022
2023
2023
2024
2025
2025
2022
2023
2022
2023
2022
2023
2022
2023

Old Standard
Old Standard
Old Standard
Old Standard
New Standard
CE: New Standard
New E: New Standard
E: New Standard
CE: New Standard
E: New Standard
Q1: New Standard
Q1: New Standard
Q2: New Standard
Q2: New Standard
H1: New Standard
H1: New Standard
H2: New Standard
H2 CE: New Standard

Sales

YoY

O.P.

YoY

R.P.

YoY

N.P.

YoY

EPS

BPS

(million yen)（%）(million yen)（%）(million yen)（%）(million yen)

（%）

(Y )

(Y )

（Y ）

11,43914,266
13,30815,142
13,382
12,927
12,95014,31015,00015,520
3,328
2,954
3,281
3,209
6,609
6,163
6,773
6,764

16.9
24.7
-6.7
13.8
0.6
-3.4
-3.2
10.5
8.5
19.3
-11.2
2.8
-2.2
10.5
-6.7
-7.6
-0.1

1,248
2,781
2,314
2,516
2,655
1,100
1,400
1,870
2,500
2,550
975
309
778
538
1,753
847
902
253

Dividend

54.7
122.8
-16.8
8.7
14.7
-58.6
-47.3
33.6

1,277
2,808
2,340
2,542
2,697
1,132
1,420
1,890

53.0
119.9
-16.7
8.6
15.2
-58.0
-47.3
33.1

906
1,816
1,668

105.5
100.4
-8.1

44.42
90.97
83.50

596.59675.81
791.64

10.33
18.00
11.33

2,367
639
800
1,130

41.9
-73.0
-66.2
41.3

118.36
31.95
40.00
56.50

847.14

24.00
13.00
16.00
18.00

36.4
109.4
-68.3
64.5
-30.8
86.8
-51.7
-34.4
-72.0

2,570
987
315
795
556
1,782
871
915
261

36.0
109.4
-68.0
62.9
-30.1
85.7
-51.1
-33.7
-71.5

1,550
614
142
835
352
1,449
494
918
145

37.2
125.4
-76.8
163.4
-57.8
145.9
-65.9
-14.9
-84.2

77.50
30.75
7.13
30.75
17.60
72.48
24.73
45.90
7.25

963.10810.96830.18863.09903.60823.79850.85

19.00
0.00
0.00
0.00
0.00
0.00
0.00
24.00
13.00

(Note) CE: the Company’s estimate/forecast. E: Alpha-Win Research Dept.’s estimate/forecast. Q1: April-June. Q2: July-September. H1:
first half or April-September. H2: second half or October-March. Forecasts for EPS, BPS, and dividend reflect the 3-for-1 stock split
conducted on October 1, 2021 (past years have been revised retroactively). “Accounting Standard for Revenue Recognition (ASBJ
Statement No. 29),” etc., have been applied starting in FY 2022. “Old Standard” is the previous revenue-recognition standard. “NewStandard” is the new revenue-recognition standard.

! Stock Price and Valuation Indicators: 9629 PCA " Figure B
Item

12/16/2022

Item

P/E

P/B

Dividend Yield

Dividend Payout Ratio

Stock Price (Y)1,285Last FY's Forecasts

10.9

1.5

1.9%

13.6%

Shares Outstanding (thou.)

23,100This FY's Forecast

32.1

1.5

1.2%

40.0%

Market Capitalization (million yen)

29,684

Next FY's Forecast

22.7

1.4

1.4%

31.9%

59.6%

Last FY’s ROE

14.4%

Dilutive Shares (thou.)0

Equity Ratio at Last FY-End(Note) Forecasts were made by Alpha-Win Research Dept.

3/41This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate, or fit
for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting from the use ofor reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual property of thisReport belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)【Stock Chart (end-of-week prices) : 9629 PCA】

Issued: 12/19/2022
Figure C

(Y)

2,500
2,300
2,100

5.00

Stock price (left axis)
Price relative to TOPIX (right axis)

4.50

1,900

4.00

1,700

3.50

1,500
1,300

3.00

1,100

2.50

900

2.00

700
500
08
/1
6
12
/1
6
04
/1
7
08
/1
7
12
/1
7
04
/1
8
08
/1
8
12
/1
8
04
/1
9
08
/1
9
12
/1
9
04
/2
0
08
/2
0
12
/2
0
04
/2
1
08
/2
1
12
/2
1
04
/2
2
08
(M / 22
M
/Y
Y
)

300

(Note) From the fourth week of August 2016 to the third week of December 2022

1.50
1.00

【Performance】
PeriodReturn vs. TOPIX
1 month0.2%
2.0%
3 months
25.7%
19.5%
6 months
10.7%
6.4%
12 months-22.6%-20.5%(Note) Reflects stock price and index
values through the closing price on
12/16/2022. The return for the 1-month
period is the comparison between theclosing price on the last day of November
and the closing price on Dec 16. Similar
for the other periods. Prepared by AlphaWin Research Dept.

＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊

Disclaimers
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc.
(hereinafter “Alpha-Win”) on the request of the company presented in this Report.
This Report is not to be construed as a recommendation or solicitation of investment. Alpha-Win shall not beliable for any consequences including direct or indirect loss, lost profit, or damage resulting from the use of or
reliance on this Report. Investors who read this Report must make their own decisions on all investment mattersand take full responsibility regarding their investment.
This Report has been prepared with a focus on objectivity and neutrality based on the analysis of generally accessible
public information and supplemental information including interview(s) by the analyst. Alpha-Win, the writer, and/or
other persons involved in the publication of this Report may already hold, or buy and sell in the future, the stock of thecompany presented in this Report.
Contents of this Report are based on information current as of the issue date and are subject to change without
notice. For the latest (updated) report, please see our website (http://www.awincap.com/). We also do not
warrant or represent that the information in this Report is accurate, reliable, complete, appropriate, or fit forany purpose and do not accept any responsibility or liability.
Copyright of this Report belongs to Alpha-Win and no part of the publication may be copied, photocopied, cited, ortranslated without our consent.
For inquiries regarding this Report, please send us an e-mail to info@awincap.com. However, Alpha-Win and thewriter of this Report do not have any obligation to reply to inquiries.
PFV2022-1228-1030(Note) In this Report, the values for the same item may not match completely within the document (including its graphs and tables)or with the Company’s announced values due to rounding, processing during calculation, method of display, adjustments related tothe consolidation of results, etc.

4/41This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate, or fit
for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting from the use ofor reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual property of thisReport belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022

Contents
1．Company Overview
Major Specialized Player in the Enterprise System Software Industry ..................................... P6
Health Management ................................................................................................................... P9
2．Business Description and Business ModelEnterprise System Software Crucial for Efficient Business Operations .................................. P10
Business Model with High Continuity and Marginal Profit Ratio .......................................... P10
Expansion of the Highly Stable and Profitable Subscription-Based Business ........................ P11
Cloud Business as the Growth Driver ...................................................................................... P12
PCA Hub Series ......................................................................................................................... P13
3．Shareholder Composition
Major Shareholder Composition .............................................................................................. P15
4．History of Growth
Company History ..................................................................................................................... P16
Past Transition in Financial Results ......................................................................................... P16
5．Business Environment
Trends of the Software Market ................................................................................................ P17
Comparison with Competitors ................................................................................................. P18
6．Results for the First Half and Full-Year Financial Forecast for This Fiscal Year
Results for the First Half of FY 2023 ........................................................................................ P19
PCA’s Financial Forecast for the Second Half of FY 2023 ...................................................... P24
PCA’s Full-Year Financial Forecast for FY 2023 ..................................................................... P26
Alpha-Win Research Dept.’s Full-Year Financial Forecast for FY 2023 ................................. P29
7．Growth Strategy
Medium- to Long-Term Vision and Policy ............................................................................. P31
Management Indicators Set as Goals ....................................................................................... P32
Alpha-Win Research Dept.’s Forecast of Medium-Term Financial Results ........................... P32
8．Analyst’s View
PCA’s Strengths and Challenges ............................................................................................. P35
Shareholder Return and Shareholder Benefit Program ............................................................ P36
Stock Price and Factors that May Affect Stock Price .............................................................. P38

Note: 1) Upon translating to English, when the page numbers differed from the original Japanese version, they were
adjusted to those of the English version of the report. 2) The Company’s fiscal year is March-ending, i.e., FY 2023
ends in March 2023.

5/41This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022

1. Company Overview
w Major specialized player
in the industry with 41
years of history,
developing and providing
packaged enterprisesystem software forJapanese small/mediumsized companies◆ Major Specialized Player in the Enterprise System
Software Industry
PCA CORPORATION (hereinafter, the “Company”) is an independent,
mid-tier, specialized company in the software industry. The Company is a
specialist in developing and selling packaged software (software preparedfor use in certain operations) for enterprise systems1, such as those foraccounting and tax. It is a major player as a specialist in such software forsmall/medium-sized companies.

(1) Enterprise system: a part of acompany’s information systemfor operations directly related tobusiness, such as financial
accounting, production
management, sales andinventory management,purchases, HR, and payroll. A
general term for back-officeapplications. Also called themission-critical system, it isimportant as the core system for
operations/services.

About 240,000 companies are active users of the Company’s products.
Sales toward ordinary companies comprise greater than 90% of the total
sales. With regards to the size of its corporate customers, the Company isespecially strong in business toward small/medium-sized companies with50 to 100 employees. 80% of the Company’s sales are made via distributors(the remaining 20% are direct sales). The Company’s customers arediversified, and by monetary value, many of its major customers are large
corporations. It is the top player in accounting software for public benefit
corporations, with its software having been implemented by over 8,000
public benefit corporations in total.

w The PCA Group iscomposed of the Company
and 3 subsidiaries.
Acquired Dreamhop in
2020.

As of the end of November 2022, the Company’s group is composed of a
total of four companies: the Company and three consolidated subsidiaries.
An overview of the consolidated subsidiaries is shown below (Figure 1).
For the details on the three consolidated subsidiaries, please see pages 2023 of our report published on November 22, 2021.
1) Xronos Inc. (development/sales of work management system2 and timeclocks; the Company founded this subsidiary in 2001 with an 80% stake)2) KEC Corporation (implementation support, operation, maintenance, andother services for PCA’s products/services; wholly owned and founded
in 1998 by the Company)
3) Dreamhop Co., Ltd. (HR/labor solutions including mental health;acquired in October 2020 as a wholly owned subsidiary)(2) Work management system:
also called the attendance
management system, it
manages/utilizes various info on
working hours. Can
automatically aggregate data on
working hours, etc., and prepare
data to link with payroll
software. Provided as onpremises or as a cloud service.

【Figure 1】Overview of the Three Consolidated Subsidiaries
Overview of Consolidated Subsidiaries
Company Name
Headquarters Location

Business Description

Dreamhop Co., Ltd.

Xronos Inc.

KEC Corporation

Iidabashi, Chiyoda-ku, Tokyo

Kanda Neribeicho, Chiyoda-ku, Tokyo

Fujimi, Chiyoda-ku, Tokyo (PCA Building)Sales offices and bases in the 3 cities of Osaka, Yokohama, and Sapporo

6 sales offices in Sapporo, Sendai, Nagoya, Osaka, Hiroshima, and Fukuoka

3 sales offices in Osaka, Nagoya, and Kyushu

HR/labor solutions and mental-health-related businesses (providing stresscheck tests and feedback for early detection of persons with mental healthproblems, and providing services for preventing leave of absence and job
Work management (attendance management) systems, in-houseseparation), occupational health physician services (consultation with
development of time clocks, and their sales and maintenance services
occupational health physicians), harassment prevention (law compliance,
liability insurance, and training), and health management (solutions suchas revitalizing the organization and improving productivity)

Sales of packaged business software such as PCA Accounting and PCA
Salary, maintenance of network systems, software installation support,
instructor support for implementation, and various user support

1,500 companies; 10,000 offices; more than 1,000,000 users

CustomerFoundedPCA Corporation; Ministry of Health, Labour and Welfare; Ministry of
the Environment; Ministry of Land, Infrastructure, Transport andTourism; Tokyo Metropolitan Government; Kanagawa Prefecture;
Saitama Prefecture; Chiba Prefecture; City of Yokohama; Osaka City;
City of Sapporo; various other government organizations and companiesof the private sector. Used by companies and organizations of a scale of
10-100,000 people.

Number of users of Xronos Performance (million users): 1.7 ⇒ 1.9 ⇒ 2.3
Number of companies using Xronos Performance: 3,935 (as of 12/5/2022)
Number of users of X'sion: 431,78 4 ⇒ 515,412 ⇒ 604,594
Number of companies using X'sion: 8,588 (as of 12/5/2022)(As of Nov. 15, 20 21 ⇒ May 9, 2022 ⇒ Dec. 5, 2022; info on its website)

More than 20,000 companies (in Japan)

October 2020 (date acquired; founded in June 2005)

May 2011 (business acquired)

April 1988

Capital (million yen)

56.5

60

10

PCA's Stake

100%

80%

100%

Number of Employees (as of the end of Sept. 2021)
Sales (for the most recent period)

15
Not disclosed

110 (as of April 1, 2022)
Y2,205 million (FY ended March 2022; information on its website; +2%
YoY sales growth)
Formulates its own medium-term plan: working on "investments for future
growth" and "steady performance growth"Management Policy

Same as PCA

Consolidated Sales Category

Other operating revenue

Mostly product sales and cloud sales, plus maintenance and other operating
revenue

Website URL

https://www.dreamhop.com/

https://www.xronos-inc.co.jp/

Expanding its business; has formed a business alliance with TOKYOTO
Intense competition, but since it is a growing market, there is potential for
Trends in Business Performance and Recent Situation BUSINESS SERVICE CO.,LTD. Its net loss seems to be improving thanks development in areas such as construction. Solid business performance
to streamlining.
among the consolidated subsidiaries. Profitability seems high.

42
Not dislocsed
Same as PCA
Mostly other operating revenue, plus products, merchandise,maintenance, and cloudhttps://www.kec-sp.com/page1
Business performance tends to be basically linked with the performance ofPCA. Due to the COVID-19 crisis, its business performance seems to be
somewhat stagnant.

(Ref) Prepared by Alpha-Win Research Dept. based on each company’s website and securities report.
(Note) Each company’s performance trends include estimates by Alpha-Win.

6/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022
The Company acquired Keepdata Ltd. (hereinafter, “Keepdata”) in March
2019 as a consolidated subsidiary. It had acquired this company as afoothold for the new data utilization business. However, creating synergy
with the Company in system linkage and sales had turned out to be difficult,and Keepdata had continuously posted a net loss and an excess of debt.
Therefore, in December 2020, the Company sold all shares of Keepdata toa third party. The Company ended up selling Keepdata less than two years
after its acquisition. However, this decision had most likely contributed
positively in terms of consolidated profit/loss, since Keepdata’s sales(estimated by Alpha-Win to have been about Y80 million) and net loss
(similarly estimated to have been several dozen million yen) no longer
became included in the consolidated results starting in FY 2021.

w Selling Keepdata positively
impacted the Company’s
profit.

w Ratio of consolidated to

The ratio of consolidated to parent-company sales had stably been around
1.1, with the parent company’s financial results having a greater weight(Figure 2). This fiscal year, the parent company’s sales are expected to
decline while the subsidiaries’ sales will grow. Therefore, the consolidatedto-parent ratio is expected to rise to 1.3 and 1.5 for sales and recurring profit,
respectively.

w Sum of the recurring

Although each subsidiary’s profit/loss is not disclosed, the ratios of
consolidated to parent-company recurring profit have been in the range of
1.0-1.6 during the fiscal years that the Company had posted a net profit(including this fiscal year’s forecast but excluding FY 2015 when a net loss
was posted). Additionally, concerning the summed profit/loss of the threesubsidiaries calculated by consolidated minus parent-company recurring
profit, a profit has been maintained since FY 2016, with a summed profit
of about Y400 million in recent years (Figure 3 on page 8).

parent-company sales had
been stable at around 1.1,
but is expected to rise to
1.3 in the current fiscal
year.

profit/loss of theconsolidated subsidiaries(consolidated minus
parent) has been positive(profitable).

Among the subsidiaries, Xronos seems to be continuing to contribute themost to the consolidated financial results, thanks to the work-style reform.
Its sales have been increasing from Y1.5 billion in FY 2019 and Y2.16
billion in FY 2021 to Y2.21 billion in FY 2022 (according to Xronos’s
website). For FY 2025, this subsidiary had planned to achieve sales of Y4
billion (according to Xronos’s former website). Although its profits havenot been disclosed, this subsidiary seems to be posting a profit andcontributing positively to consolidated profit.
【Figure 2】Ratio of Consolidated to Parent-Company Sales (ratios shown on upper portion of graph)
Unit: million yen

Sales of parent company

16,000
1.1

1.1

1.1

Consolidated sales minus parent company sales

1.1

1.1

1.1

14,000

1.1

1.1

1.2

887

Consolidated
to parent
company
ratio

1,167

12,0002,659
712

10,000

1.3

2,827

782
732

8,000

681

825

680

13,3796,000

10,727

9,693
4,000

7,487

7,761

FY 2015

FY 2016

8,628

8,960

FY 2017

FY 2018

12,141

10,723

10,1002,000
0FY 2014

FY 2019

FY 2020

FY 2021

FY 2022

FY 2023 CE(Ref) Figures 2 and 3 were prepared by Alpha-Win Research Dept. based on the securities report. CE: the Company’s plan.

7/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022【Figure 3】Ratio of Consolidated to Parent-Company Recurring Profit (ratios shown on upper portion of graph)
R.P. of parent company

Unit: million yen

3,000

1.2

N.A

1.6

Consolidated R.P. minus parent company R.P.

1.1

1.0

1.2

1.2

1.2

402

2,500

Consolidated
to parent

1.2

1.5 company
ratio

470
443

2,000
1,500
1,000

221

500

918

2,406

238
34

1,897

59
-139

356

1,039

800

26

2,227

776

405

0
41

-19
-500
FY 2014

FY 2015

FY 2016

FY 2017

FY 2018

FY 2019

FY 2020

FY 2021

FY 2022

FY 2023 CE

w Founded by certified public
accountants in 1980

The name of the Company comes from the five founders who were certified
public accountants (CPA); the letters CPA were shuffled into themeaningful name P (Professional) C (Computer) A (Automation).

w Rich in cash. Debt-less

The Company’s financial standing is firm, rich in cash and debt-less.
Relative to its sales of Y13.0 billion (this fiscal year’s plan) and total assetsof Y28.5 billion, its debt is zero and it has Y16.5 billion in cash & deposits,
which is equivalent to 58% of total assets and 15.3 months’ worth of
average monthly sales (values as of the end of September 2022).

(3) FCF (Free Cash Flow): FCF =Operating CF + Investing CF.
Cash which can be “freely”
used. CF generated by acompany minus its
investments, etc., necessary tomaintain its business.

Free cash flow (FCF)3 has been positive except for FY 2015, and cash &deposits on the balance sheet (B/S) have been increasing (Figure 4). In thefirst half of the current fiscal year, while CF from operating activities
decreased, CF from investing activities increased due to factors including
the acquisition of investment securities. Consequently, FCF became almost
halved from the previous fiscal year, but remained positive at over Y1billion.

w Cash & deposits are
increasing to record-highlevels, exceeding theannual sales. Financial
standing is solid.

In addition, capital has been accumulating due to profits, and the balanceof cash & deposits on the balance sheet has risen to a record-high level.
Financial ratios are at also highly secure levels, with an equity ratio of
59.6% and a current ratio of 214.5% (as of the end of September 2022).

management. Positive FCF
maintained.

【Figure 4】Change in Cash Flow (CF) (unit: million yen)
Unit: million yen

FY 2010

FY 2011

FY 2012FY 2013

FY 2014

FY 2015

FY 2016

FY 2017

FY 2018

FY 2019

FY 2020

FY 2021

FY 2022First Half of FY 2023

First Half of FY 2022

Operating CF

①

627

488

141

847

1,048

547

1,427

1,533

1,270

2,141

3,328

1,632

3,684

1,296

Investing CF

②

-405

-127

185

-407

-750

-606

-627

-395

1,715

-80

-719

253

708

-266

589

-207

-210

-205

-215

-216

-284

-214

-215

-216

-572

-225

-355

-254

-605

-247

Financing CF

1,988

FCF ( ①+②)

222

361

326

440

299

-60

800

1,137

2,985

2,061

2,609

1,885

4,392

1,030

2,577

Cash and Deposits (on B/S)

6,817

5,970

5,493

6,621

6,606

6,154

6,612

7,487

7,269

7,280

10,716

11,74916,09016,517

14,080(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary(Note) Cash and deposits shown are values from the balance sheet, not values from the CF statement.

8/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022◆ Health Management
w The Company believes that
employees are the mostimportant businessresource supporting
sustainable growth, and has
created a working
environment with acommitment to healthmanagement.

The Company believes that the most important business resource
supporting sustainable growth is its employees. Under the “HealthManagement Declaration,” the Company recognizes that one of its mostimportant business challenges is to create an environment in which every
employee can continue to work toward challenges while maintaining good
physical and mental health and feeling a sense of fulfillment in their workand personal growth.
The Company is working on initiatives from the following perspectives:(1) Management of employee health・ Encourage periodic health checkups (100% of employees havereceived checkups)
・Mental health care and stress checks (conducted once a year for all
employees)
・Infection prevention measures (free vaccination to those who wish)2) Workplace environment
・Innovative office environment (all free-address across the Company
with the ABW or Active Based Working workstyle)・All offices are non-smoking; also created relaxation spaces
3) Flexible workstyles (remote-work rate is around 80%, with work-fromhome support subsidies provided)
4) Work-life balance・Measures to prevent overwork (internal rule setting 30 hours as the
maximum hours of overtime work)
・Measures to improve the paid-leave acquisition rate and measures tobalance work and childcare

9/41This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022

2．Business Description and Business Model◆Enterprise System Software Crucial for Efficient
Business Operations
w Enterprise systems are
mission critical. Stability
and reliability are crucial
elements since they areused inside companies.

The Company’s core business is enterprise systems that support internalbusiness operations. Unlike systems that simply work on personal
computers, an enterprise system is a computer system that supports a seriesof processes throughout all business operation flows within a company.
Since it is mission-critical for business operations, it is required to bereliable, efficient, stable, user-friendly, secure, and expandable.
The main methods for building an enterprise system are package-based
system development and original system development. Generally, themethod of combining sold packaged software into a system has advantages
such as short development time, cheapness, and having relatively few bugs.
On the other hand, its disadvantage is the difficulty in customizing thesystem to a company’s business conditions, operations, management styles,
and other specific needs.
As for original software development and implementation, outsourced
development and in-house development are the two options. In either case,the advantage of an original system is that it is easier to use since it can becustomized to a company’s needs and operations. However, development
cost and time are larger and longer, and it requires revisions, addition offunctions, and maintenance after implementation. Micro-sized, small-sized,
medium-sized, and mid-tier companies especially tend to find thedevelopment, implementation, and operation of original software difficult
due to financial, staff, and time constraints.

(4) Accounting software:
application software for therecording, processing, andintegrated management ofaccounting data
(5) HR and payroll software:
software for payroll calculationsand HR management

In response to this, the Company has been developing original enterprisesystem software that specifically meets the needs of one-person businesses
and micro-sized (SOHO), small-sized, medium-sized, and mid-tiercompanies in areas such as accounting4, finance, HR and payroll5, sales
management, purchase and inventory management, and tax. The enterprisesystem software is either packaged (on-premises: conventional products
operated in-house by a corporate user) or cloud-based (a service in which a
corporate user can use the enterprise system software via the Internet easily
and at a low cost without having to prepare its own server). The Company
sells and provides its software through either direct or indirect channels.
Additionally, the Company has not just been developing and sellingenterprise system software but has also been expanding its business byproviding consulting services based on solution proposals. With its
subsidiaries, it has also been providing various support services such as
maintenance service and implementation/operation support. Going forward,
the Company plans to further strengthen these businesses.

w Provides about 26 types oforiginally developed
packaged enterprisesystem software
w About 70% of sales comefrom originally developed
products and services.

◆Business Model with High Continuity and Marginal
Profit Ratio
The Company provides a total of about 26 types of software (counted byproduct name, including options). Its business model is based on the mass
production of a limited number of types of products. Due to the nature ofits business, its marginal profit ratio is high. Its original products andservices (products/maintenance/cloud) account for a little over 70% of the

10/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022
total sales, while the remaining 30% are from other companies’ products(purchased merchandise) in the merchandise / other operating revenue
categories. From the development to the release of a new product,
approximately two years and a corresponding amount of cost are necessary.
Version upgrades (revision updates), which are prepared as needed, arereleased usually in a one- to two-year cycle. In recent years, however,software functions have become so enhanced that customers now tend topurchase less in response to this version upgrade cycle.

w Entry barrier is high sincereliability and proven trackrecord are required.

Since these types of software are related to operations that must be highly
reliable, and since software replacements give rise to issues of cost, labor,
and data continuity, their users show little interest in actively or frequently
replacing their current software with an alternative of a different company.
Therefore, customer loyalty is high, and contracts have high contract repeat
rates (50% to 90% or greater depending on the type of software). The
barrier to market entry is high because trust and brand recognition are amust in this industry and the companies are currently mostly being able toexist alongside one another by taking strong positions in different niches.

◆Expansion of the Highly
Subscription-Based Business
w Sales are divided into fivecategories. Focused on thesubscription-based
businesses.

Stable and Profitable

Since FY 2017, all business segments have been consolidated into one, andsales have been disclosed for five sales categories (types): “products,”“merchandise,” “maintenance service,” “cloud service,” and “otheroperating revenue (also called “solutions”)” (Figure 5). Profit and loss bysegment are not disclosed.

【Figure 5】Sales Classification (by category) and Composition
First Half of FY 2023 (results)

Sales Classification by
Category
Products
Merchandise
Maintenance Service
Cloud Service

Contents
Sales of original packaged software (accounting, sales management, purchasing and inventory management, payroll, HR, etc.)(includes version upgrades)
Sales of other companies’ products such as ledger sheets
By signing up to PSS membership, users can receive inquiry and support services from call centers
Subscription service for software provided as a cloud service

Other Operating Revenue Sales of other companies’ products such as software/hardware combined with its original products; also called “solutions”

Total & Average

Reference

Sales (million yen)

% of Total Sales

Est. Gross Margin

557

9.0

About 65%

222
1,688
2,860
834

3.6
27.4
46.4
13.5

About 30%

6,163

100.0

Result: 63.5%

About 75%
About 65%
About 60%

Estimate based on weighted average: 65.7%(Ref) Prepared by Alpha-Win Research Dept. based on the securities report and interview. Gross margins have been estimated by AlphaWin. Sales for each category are based on the new standard.
(Note) Maintenance service and cloud service are the subscription-based businesses.

w Subscription-based
businesses (maintenance& cloud) account for about
74% of the total sales.

In recent years, sales of cloud services of the Company’s packaged
software have grown significantly, and they have become the Company’s
growth driver with regards to both the overall sales and profit. In the firsthalf of FY 2023, sales of the cloud service were the largest by sales
category, followed by maintenance service. The sum of these twocategories, or subscription-based revenue (also called the “stock business”
in Japanese), accounted for about 74% of the total sales. The maintenanceand the cloud services have high gross margins and contract repeat rates
and they have been stable sources of profit, contributing to a greater
stability in business and profit. On the other hand, sales of products andsolutions (other operating revenue) have tended to be influenced by eventdriven high demands, replacement cycles, and version upgrades.
Consolidated sales breakdown by the operation type of software is notdisclosed. However, sales seem to be diversified, with the sales foraccounting software predicted to be the largest by composition (about 15%of the total sales), followed by software for sales management,

11/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022
purchase/inventory management, and then lastly payroll/HR. Currently, theCompany primarily sets internal targets based on software sales (or the sold
number of products) by operation type. Target values are not set for the
profit/loss of each operation type of software. However, it has been working
with an external IT consultation firm to create and adopt new performance
management indicators. Future changes such as its transition from salesbased management to profit-based management will be a key point. The
profit margins of each operation type of software do not greatly differ
between one another, but the main accounting software business isgenerally the most profitable.
The percentage of new software sales or version upgrade sales over the total
sales changes every year, but the percentage of version upgrades has always
been greater than 50%. As reference, the Company’s on-premises products
tend to be installed and used by users on a single PC (stand-alone).

◆Cloud Business as the Growth Driverw Rapidly shifting frompackaged software sales tothe cloud/subscriptionbased business modelw

w The rapidly growing cloudbusiness is based on a
subscription-based, stablebusiness model. Taking alead in the market as the
single, obvious top player,
the Company has a highcompetitive edge.

For many years, the Company had been focused on the business of selling
conventional packaged software, also known as on-premises. However, as
the Internet became more sophisticated and more widely used, it predictedthat the demand for the cloud will rise due to its convenience and cost
performance. Therefore, in 2008, the Company started providing cloudbased services more than ten years ahead of its competitors. Since then, it
has been providing cloud versions of all of its on-premises software.
In the cloud business, users pay fees continuously for a certain period to use
the software (subscription model). It is attractive as a stable, subscriptionbased business model, similar to the maintenance service (average monthly
fee of 20-30 thousand yen per corporate user). Due to its cost structure, thisbusiness has relatively small variable costs such as those for server
maintenance, manufacturing, sales, and logistics. It therefore has a highmarginal profit ratio.
The Company leads the industry as No. 1 in cloud-based, enterprise system
software business targeting small/medium-sized companies. The
advantages listed below seem to be making the Company stand out from its
competitors in the field. In recent years (2017-2018), its competitors havealso entered the cloud market in full scale as their “first year of the cloud,”but the Company is expected maintain its advantages for the meanwhile.

(6) API (Application
Programming Interface):interface/network to use tosoftware; connects the softwareand the program.
(7) Kintone: cloud service forbuilding business app on a web
database, provided by Cybozu.
Allows easy system build-up andlinkage with other systems.
(8) AWS: Stands for Amazon
Web Services; the collective
name for the cloud computing
services provided by Amazon.
The on AWS version enables theuse of PCA’s cloud services on
the AWS server.

・ Providing a wide variety of sophisticated software for business operations
・ Originally developed open architecture; low cost・ Economies of scale are in effect, with more than 19,000 corporate users of
the cloud service already; well profitable
・ Therefore, it has a very strong price advantage compared to competitors
・ More than ten years’ worth of operation expertise・ User-friendly, with WebAPI6 allowing linkage with other companies’
cloud (linkage already possible with about 60 companies, including
Kintone7 of Cybozu)
・ In PCA Cloud on AWS8, service is available 24 hours, 365 days (maxnumber of licenses for simultaneous use expanded from 3 to 72 CAL).
In recent years, it has been focused on the cloud service, and the number of
its users as well as sales has been growing steadily (Figure 12 on page 20).
During the COVID-19 crisis, though, the business expanded but there wassome temporary slowdown in the growth rate. However, both the net
12/41

This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

w PCA Hub service centeredaround PCA Hub eDOC wasstarted in March 2022. Cloud
service for document
management that also
supports the application of
the Electronic Books
Maintenance Act.
(9) (PCA) hyper: new software for
mid-tier companies as a successor
to Dream21. A superior version of
the DX series. Its unique feature isthat smooth linkage can be madewith other systems using API,
allowing streamlining of data
management within an entire
corporate group (consolidated
accounting).
(10) [The revised] Electronic
Books Maintenance Act: A lawthat allows the storage of nationaltax-related books and documents
as electronic data. Came into
effect in January 2022. Its purpose
is to improve productivity andconvenience, as well as promoting
paperless operation and remote
work.

Issued: 12/19/2022
number of users and the sales growth rate increased at accelerated rates in
the previous fiscal year with the event-driven high demand, and thebusiness is believed to continue to be the Company’s main growth driver.

◆ PCA Hub Series
The PCA Hub service (hub as in “the center of something”), which theCompany has been developing in-house, was started in March 2022. PCA
Hub is a new service that helps small/medium-sized and mid-tier companies
share mission-critical data and shift to paperless internal operations andB2B transactions, thereby contributing to the digitization of the Japanesesociety.
The concept of the PCA Hub series is “supporting companies and oursociety through technology.” Toward the creation of a sustainable society,the series will provide “levels of operation efficiency optimization that
seemed out of reach” at “prices within reach” for operational challenges
which have yet to be solved by systems due to investment costs being too
high.
As the first and the core service of the series, PCA Hub eDOC was released(PCA Hub eDOC is a part of the PCA Hub service). It is an online storage
service (cloud-based document management service) that allows
companies to safely and securely share important business data and files
internally. Linked with the PCA DX series and the hyper9 series, it is a tool
for optimizing operation efficiency.
As shown in Figure 6, PCA Hub eDOC enables the digitization andpaperless operation of fund management, accounting management, labor
management, and so on. It also supports the requirements of the Electronic
Books Maintenance Act10 and has acquired the JIIMA certification.

(11) JIIMA certification: “Legal
Requirements Certification
Program for Scan-Store Softwarein Applying the Electronic Books
Law” by the Japan Image andInformation Management
Association (JIIMA). Checks
whether commercially available
software meets the requirements ofthe Electronic Books Maintenance
Act and certifies those that havebeen judged to meet the legal
requirements.

In addition, through effective utilization of the data accumulated from these
services using visualization, analysis, and AI-linkage, the Company aims
to create new values. It hopes to thereby contribute to the customer successof especially small/medium-sized companies, which are its current
customers.

【Figure 6】Business Areas andFunctions of PCA Hub eDoc

Whereas the previous product eDOC X was provided free of charge as onpremises, PCA Hub eDOC is a cloud-based, monthly subscription service
that is highly expandable. In the future, the Company intends to also
provide peripheral services for the eDOC and develop the business into astable source of revenue.

Automatic deposit
check

Automaticjournal entries

There are three price plans depending on the number of users and storage
capacity, with monthly fees of Y6,380, Y10,780, or Y19,580 (plus, paid
options available). The pricing system is set at easy-to-start prices. The
Company aims to gain 2,000 corporate users in the first year after its release(annual full contribution to sales is estimated to be approx. Y153 million toY470 million).

Expensesettlement

Budgetmanagement

Following PCA Hub eDOC, PCA Hub eDOC AI-OCR Option was releasedin November as part of the PCA Hub Series.

Monitoring / abnormal
value detection

Labor
management

Pay slip

Work shift
management

Year-end tax
adjustment

Talent management(recruit/place/train/evaluate,
etc.)(Ref) Financial results briefing materials

For the lineup of the PCA Hub series, see Figure 7 on page 14.
The optional service will enable the user’s accounting staff to automate
their input work by reading the customer name, amount, and date on the

13/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022
received invoices and receipts using the AI-OCR function to automaticallyregister and link the information to PCA Hub eDOC.
In addition to this, in March 2023, the Company plans to release web-based
services for invoices that also support electronic invoices (such as theconversion of invoices to electronic forms) and for pay slips (pay slips,
withholding tax slips, year-end adjustment notifications, etc.).

(12) New invoicing system: The
Qualified Invoice Preservation
Method, which will start in
October 2023. A new system for
issuing and storing invoices anddelivery slips, created for the
purpose of accurately recognizing
the amount of consumption tax
in transactions.

In response to the Qualified Invoice Preservation Method (new invoicing
system12) that will start in October 2023, the Company also plans to releasenew versions of its current, major PCA products and services around thesummer of 2023 that will be compatible with this system. It plans to also
continue to create a variety of other services of the PCA Hub series.

【Figure 7】Lineup and Release Schedules of the PCA Hub Series
Date

Service/productSituation

Notes (characteristics)

March 2022

PCA Hub

Released / Service started

A new service that supports mid-tier and small/medium-sized companies in shifting to paperlessinternal operations and B2B transactions for the digitalization of the Japanese society.

March 2022

PCA Hub eDOC

Released / Service started

An online storage service for safe and secure sharing of important business data and files within acompany. It is also compatible with the Electronic Books Maintenance Act and can be used to store
receipts, invoices, and other vouchers.

November 2022

PCA Hub eDOC AI-OCR Option

Released / Service started

Optional service. Function which automatically registers the customer name, amount, and date onreceived invoices and receipts to PCA Hub eDOC using AI-OCR.
Advantages:
・ Can automate the input work of accounting staff.
・Registered data can be linked to various software of the PCA Accounting series to create journal
entries.
A service for electronic delivery of invoices and transaction details that is also compatible withelectronic invoices. It can be linked to the PCA Shokon and Shokan series and PCA Accounting
hyper Receivables Management Option. Supports the shift to paperless invoicing and digitalizationof the invoicing process itself.

March 2023

PCA Hub Invoice

Release planned

Advantages:
・Web-based delivery of invoices reduces the cost of mailing paper invoices.
・Significant reduction in the amount of time required to enclose and send invoices by mail.
・Eliminates the need for employees to come to office for invoicing work (eliminating a barrier toremote work)
・Reduction in the workload necessary to reissue invoices

March 2023

PCA Hub Pay Slip

Release planned

Service specialized in web-based pay slip delivery. Calculation results of the PCA Payroll series canbe imported into PCA Hub Pay Slip and sent to employees as a notification. Documents that can bedelivered include pay slips, bonus slips, refund statements, and withholding tax slips.
Advantages: Same as PCA Hub Invoice above

Around summer 2023

Existing major products

Planned to becomecompatible with the new
invoice system

The hyper/DX series (packaged versions), PCA Cloud (including onAWS), PCA Subscription, andPCA Hub will all be compatible; X series and other products whose support has ended will not becompatible.

Not decided

Labor-related productRelease planned

Services for labor-related processes, etc.

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials and news release on its website

14/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022

3． Shareholder Composition◆ Major Shareholder Composition
Major shareholders as of the end of September 2022 are shown in Figure 8.
Compared to the end of March 2022, shares held by the top ten major
shareholders have not significantly changed except for FCP, STATESTREET, and the Employee Stock Ownership Plan as described below.
・ The largest shareholder is Kawashima Co., Ltd. (asset managementcompany of the founder Kawashima’s family and the Company’s president
Fumiaki Sato) whose shares have not changed.
・The Company itself is essentially the second largest shareholder and owns
a total of approx. 13.4% of its own shares.

w No change to stableshareholders in Japanw The largest shareholder isthe founder family’s asset
management company.
w PCA owns 13.4% of its own
shares and is essentiallythe second largest
shareholder.

・The sixth largest shareholder FCP SEXTANT AUTOUR DU MONDE(an equity investment fund managed by the French company Amiral
Gestion, which is an independent asset management company founded in2003 and focused on long-term investments) and its eighth largest
shareholder STATE STREET BANK AND TRUST COMPANY(reappeared as a major shareholder) have bought more shares.

w The two overseas investors
have bought more shares.

【Figure 8】Current Major Shareholders
Unit for number of shares owned: thousand shares
Unit for ratios: %Kawashima Co., Ltd.
PCA CORPORATION (treasury shares)
JP MORGAN CHASE BANK 385632
The Master Trust Bank of Japan, Ltd. (trust account)
MSIP CLIENT SECURITIESObic Business Consultants Co., Ltd.
FCP SEXTANT AUTOUR DU MOUDEPCA Employee Stock Ownership Plan
State Street Bank and Trust Company 505001

Logic Systems Co., Ltd.
Nagoya PCA Co., Ltd.
APPLIED SYSTEM LABORATORY Inc.
GOLDMAN SACHS INTERNATIONAL
Custody Bank of Japan, Ltd. (trust account)
BNY GCM CLIENT ACCOUNT JPRD AC ISG (FE-AC)
JPMBL RE NOMURA INTERNATIONAL PLC 1 COLLEQUITY
JP MORGAN LUXEMBOURG S.A. 1300000
MSCO CUSTOMER SECURITIESCredit Suisse Securities
Japan Trustee Services Bank, Ltd. (trust account)
SSBTC CLIENT OMNIBUS ACCOUNT
Mizuho Bank, Ltd.
BNYM SA/NV FOR BNYM FOR BNY GCM CLIENT ACCOUNTS MLSCB RD
Shigefumi Wada (individual)
KBL EPB S.A. 107704
Reiko Sato (individual): Heir to the founder Masao Kawashima
Tomoko Kumamoto (individual): Heir to the founder Masao Kawashima
Hiroko Wada (individual)

End of Mar.
2015

End of Mar.
2016

End of Mar.
2017

End of Mar.
2018

End of Mar.
2019

End of Mar.
2020

2,544

2,544

8,805
2,544

8,805
2,546

8,208
3,146

8,205
3,136

End of Mar.
End of Sept.
End of Mar. 2022
2021
2022

762

762

762

762

762

885
762

8,208
3,101
1,014
284
886
762

330
732
342

357
747
342
300

381
798
342
300
258

381
798
342
300
258

406
521
342
300

300

337

342
300
258

342
300

8,208
3,101
1,399
1,137
886
762
377
349
342
300
260

8,207
3,100
1,398
1,320
885
762
450
372
351
342
300

Shareholding
Ratio

Ranking

41.04
13.42
6.99
6.60
4.43
3.81
2.25
1.86
1.76
1.71
1.50

1
―
2
3
4
5
6
7
8
9
10

909
463
359

1,416
267
261
363

363

363

363

363

543

543

543

453
270

335
282

4,401
4,401
1,074

4,401
4,401

(Ref) Prepared by Alpha-Win Research Dept. based on the securities report the notice of shareholders’ meeting.

w MFS, a major US-based

investment management
firm, continues to holdmore than 5% of all shares.

・The Massachusetts Financial Services Company (MFS: one of the oldest
investment firms in the US that invests globally) had submitted a statementof large-volume holdings (the “5%-rule” statement) for the increase in its
shareholding ratio from 5.22% to 6.23% (401,900 shares to 479,400 shares)
as of March 31, 2022. Although MFS is not included in the list of major
shareholders on Figure 8, it is presumably investing through several
accounts of custodians (trust banks).
Regarding investment trusts in Japan, the Company’s shares areincorporated in index funds managed by major asset managementcompanies.

15/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022

4． History of Growth◆ Company History

w Founded upon recognizing
the importance andpromising future ofcomputers and enterprisesystem software in Japan

A group of five certified public accountants with the late Masao
Kawashima as the leader founded the Company in 1980 upon recognizing
the importance and the promising future of computer and software
businesses in Japan. At first, they developed and sold business accounting
software for small business computers. In 1995, expecting to eventuallyshift away from users of small business computers, the Company began
focusing on the development and marketing of packaged software for
personal computers.

w With a pioneering spirit,
became the first to begin
cloud services in theindustry

Then, with the emergence of the PC era, the Company has achieved growth
mainly through the following four strategies: 1) creation of a greater varietyof packaged software for Japanese customers as well as their version
upgrades, 2) expansion of the maintenance service, 3) development of thecloud business, and 4) expansion of the solutions business which includes
providing other companies’ products. Furthermore, by increasing thenumber of offices and cooperating with manufacturers and distributors, theCompany has developed a nationwide sales/support system that hascontributed to the rapid expansion of its business. It is also seen as a pioneerin the conservative industry, having been the first in the industry to begin
providing cloud services (SaaS13) in 2008.

(13) SaaS (Software as a Service):
software in which, as a service,users can use the necessaryfunction in the necessary amountwhen needed; or the method ofproviding such service. Instead of
the user installing the software, thevendor operates the software andprovides the necessary function to
the user via a network.
w Changed its market listingfrom the Second to the First
Section of the TSE in Dec.
2014. Its listing was changed
to the Prime Market in April
2022.

Regarding its stock, the first public offering was made in 1994. The
Company became listed on the Second Section of the TSE in 2000 and thenon the First Section in 2014. Upon becoming listed on the First Section of
the TSE, the Company changed its logo to the current one. In April 2022,
its listing was changed to the TSE Prime Market.

w Has been generally
increasing sales over thelong term. Profit had
temporarily weakened, butthen recovered in a V-shape.
Hit record sales and profits
in FY 2020 thanks to eventdriven high demand. Sales
and profit are expected to
decline again in FY 2023.

◆ Past Transition in Financial Results
As described above, the Company has been expanding its business since
foundation until now as a specialist in the development and marketing ofenterprise system software and related businesses. The transition in
financial results since its first public offering is described in Figure 9 (fordetails, see the previous report issued on July 4, 2022).

【Figure 9】Long-Term Transition in Financial Results
Sales (left axis)

Recurring Profit (right axis)(million yen)(million yen)

16,0002,808
14,266

14,00012,00011,4391,783

10,000

1,539
1,290

6,000 660

1,396

1,227

1,218

8,000

794

1,565

935

9,785
9,360
1277
8,441
8,168

1,582
1,392

1,181

1,084

5,095
5,441
4,827
4,762
4,867
3,541 4,551
4,000
3,232
5,026
3,017
565

10,475

7,551

1,181
6,383

6,006
5,597

6,336

6,269

798

6,805

834

1,139

724

6,275

3,000

2,697
2,340

13,3082,500
13,3822,000

12,927
1,500

1,132

1,000

463
6,167
5,867

500
501 384

67
0

2,000
-158

-500

FY

19
FY 94
19
FY 95
19
FY 96
19
FY 97
19
FY 98
19
FY 99
20
FY 00
20
FY 01
20
FY 02
20
FY 03
20
FY 04
20
FY 05
20
FY 06
20
FY 07
20
FY 08
20
FY 09
20
FY 10
20
FY 11
20
FY 12
20
FY 13
20
FY 14
20
FY 15
20
FY 16
20
FY 17
20
FY 18
20
FY 19
20
FY 20
20
FY 21
FY 202
20 2
23
CE

0

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary. Estimate/forecast (CE)for FY 2023 is from the Company’s plan (based on the new revenue-recognition standard).

16/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022

5． Business Environment◆Trends of the Software Market
w Decreasing number ofsmall/medium-sizedcompanies (its current andpotential users) in Japan,
but the cloud-based
enterprise system software
services are expected tosteadily grow over the
medium to long term.

w Market potential of cloudbased enterprise system
software in Japan is stilllarge.

Number of Small/Medium-Sized Companies (potential users) in JapanThe number of small/medium-sized companies, or the Company’s main
potential customers, has been declining since they have been closing theirbusinesses due to the decreasing and aging population of Japan. On theother hand, companies and organizations have been working on rebuilding
or strengthening their enterprise systems, as they have been faced byincreasingly serious staff shortage and have been working on improving
operational efficiency and financial performance. Although the number ofsmall/medium-sized companies will likely continue to decrease, we predictthat the size of the enterprise system software market will steadily increaseover the medium to long term, especially for the cloud services, as thedemand for software to improve business operation efficiency increases.

Market Size and Growth Potential
According to the “WHITE PAPER Information and Communications inJapan” by the Ministry of Internal Affairs and Communications, the size ofthe packaged software market (excluding game software, embedded
software, etc.) in 2017 was approximately Y1.1 trillion. With increasing
digitalization and shift to online activities, the B2B market seems to be
gradually expanding (our estimate for the annual growth rate is +4 to +5%).
We estimate the current size of the enterprise system software market in
Japan specifically related to the Company’s business to be approx. Y500
billion and the size of the ERP market to be approx. Y100 billion. Annual
growth rate is predicted to be about 3% and 10%, respectively, over the
medium term.
In the U.S., the cloud-based enterprise system software market is said to be
several years ahead of Japan. The market penetration rate in Japan is about½ to ⅓ compared to the US (ref: “WHITE PAPER Information andCommunications in Japan” by the Ministry of Internal Affairs andCommunications, etc.). Therefore, there seems to be a large growthpotential. According to this “WHITE PAPER,” the penetration rate of thecloud in Japan is still low: from 2017 to 2020, it has grown from 26% to
38% for “payroll / financial accounting / HR” and from 6-8% to about 10%
each for “production management / logistics management / store
management,” “purchasing,” and “sales on order.” The cloud-based
enterprise system software market may grow at a high rate of about 20%
per year over the medium term as it replaces a part of the outsourced systemdevelopment or packaged software (on-premises) market.

w The sentiment ofsmall/medium-sized andmid-tier companies has
settled down compared tothe past and software
investment is expected toincrease. However, withthe uncertainties of themacro environment, theearnings environment
continues to be difficult.

Current Situation: BOJ Tankan
According to the Bank of Japan Tankan in December 2022, the amount ofsoftware investment in 2022 (plan) by small/medium-sized companies (allindustries) is planned to rise significantly by +15.5% YoY (of which,+29.5% for manufacturing and +11.6% for non-manufacturing), withgrowth especially expected for the manufacturing industries. Mid-tiercompanies are also showing an eager attitude toward increasing software
investment, with an increase of +23.8% (+39.7% and +19.8%, respectively)
expected. Regarding the survey on business sentiment amongsmall/medium-sized companies, the “recent” sentiment improved from -2
in the June 2022 survey to 0 in September 2022 and +4 in December 2022,
17/41

This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022
and “outlook” also improved from -5 to -4 to -2 in the same order. Although
the market sentiment has improved compared to the past, the earnings
environment of small/medium-sized companies continues to be difficult
with the inflation, weak yen, and the COVID-19 crisis.

◆Comparison with Competitors
w In the industry, companies
are mostly able to exist
alongside one another bytaking strong positions
that are segregated by theirusers’ sizes and software
function.
w OBC, MJS, Yayoi, and
OHKEN are its rivals.

Positions and Main Players of the Industry
The players in the industry are mostly being able to exist alongside one
another by taking strong positions in different niches, segregated by the sizeof the companies/organizations that are their users or by the operation
targeted by their software (Figure 10).
The Company has different rivals for each type of operation targeted by its
software. Regarding its rivals among listed companies for its key
accounting software, its direct rival is thought to be Obic Business
Consultants (OBC: 4733) and its indirect rival is most likely Miroku Jyoho
Service (MJS: 9928). OBC is the greatest rival since it has almost the same
product lineup and business model as the Company.
Among private companies, its direct competitors are Yayoi Co., Ltd. (in thefiscal year ended September 2021, sales were Y21,193 million and thenumber of users was a little over 2.5 million) that was purchased by
Kohlberg Kravis Roberts & Co. L.P. (“KRR”) from ORIX Corporation(8591; listed on TSE Prime), OHKEN (independent company), and OSK(subsidiary of OTSUKA CORPORATION).

w In addition to OBC, also
competing with Money
Forward and freee in a partof the cloud-based
accounting software
business.

w The Company provides
high-quality products andservices at reasonable
prices.
w Its key product, theaccounting software, has
the third largest share in
the market.

In addition to the above, in the cloud accounting market, its maincompetitors among listed companies are Money Forward (TSE Prime 3994;
providing cloud services such as household accounting application for
individuals and accounting software for companies) and freee (TSE Growth4478; providing ERP services or cloud accounting software for small
businesses). These companies target one-person businesses and small
companies such as small/medium-sized companies and SOHOs, so they
compete with the Company only in specific areas.
The Company is characterized by its high-quality but reasonably priced
products and services.
The accounting software market size is estimated to be approx. Y200 billion.
The market is reaching maturity and its size has stayed mostly flat over the
recent years. In this market, the Company is estimated to be third from thetop (about 10% of the total market share). It also seems to have a similarlevel of market share and position with its payroll and HR software.

【Figure 10】Target Customers and Main Players of
the Enterprise System Software Market(Ref) Excerpt from past financial results
briefing materials, partially edited by AlphaWin Research Dept.

18/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022

6 ． Results for the First Half and Full-Year
Financial Forecast for This Fiscal Year
◆ Results for the First Half of FY 2023
w First-half results: decline insales and a significant dropin profits

w Although the forecast for
the first half is notdisclosed, profits havepresumably largely
exceeded the plan, judging
from its large progress.

Overview
Consolidated results for the first half of FY 2023 were as follows: sales ofY6,163 million (-6.7% YoY), operating profit of Y847 million (-51.7%
YoY), recurring profit of Y871 million (-51.1% YoY), and net profit
attributable to owners of the parent of Y494 million (-65.9% YoY;
hereinafter, “net profit”). Sales decreased, and profits also decreased
significantly (Figure 11).
Progress in the first half compared to the full-year plan was 47.7% for sales,
77.0% for operating profit, and 77.3% for net profit. Although the Company
has not disclosed its forecasts of consolidated results for the first half of thisfiscal year, comparison with progress during past years indicates that sales
were most likely slightly above the plan by several percentage points, while
profits were significantly higher than the plan.

【Figure 11】Financial Results for the First HalfFirst-Half Results
Results

First Half of FY 2022

First Half of FY 2023

% ChangeAmount of Change% of Total Sales

Unit: million yen

Apr-Sep 2021

Apr-Sep 2022

YoY: %

YoY: million yen%

Consolidated Sales

Sales by Category

6,609

6,163

-6.7

-446

100.0

Products
Merchandise
Maintenance Service

1,718

557

-67.6

-1,161

9.0

167

222

33.4

55

3.6

1,646

1,688

2.5

42

27.4

Cloud Service
Other Operating Revenue

2,595

2,860

10.2

265

46.4

481
4,506
68.2
2,753
41.7
1,753
26.5
1,782
27.0
1,449
21.9

834
3,912
63.5
3,065
49.7
847
13.7
871
14.1
494
8.0

73.2
-13.2

353
-594
-4.7
312
8.1
-906
-12.8
-911
-12.8
-955
-13.9

13.5

Gross Profit
Gross Margin (%)
SG&A Expenses
SG&A Expenses Ratio (%)
Operating Profit
Operating Margin (%)
Recurring Profit
Recurring Margin (%)
Net Profit
Net Margin (%)

11.3
-51.7
-51.1
-65.9

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary and financial results briefing materials.

w The large decline in sales
this fiscal year was mainly
due to the fallback fromthe event-driven highdemand for the products inthe previous fiscal year.

w Sales and operating profit
in the previous fiscal year
were the second highest in
the Company's history.

Sales
In the previous fiscal year (FY 2022), the termination of support (at the endof December 2021) for the X series (on-premises product) had generated areplacement demand (event-driven high demand) of approximately 1 to 1.2
billion yen in the first half and approximately 500 million yen in the second
half as estimated by the Company. This demand had contributed
significantly to its financial performance. Since this event-driven highdemand mainly occurred in the first half of the previous fiscal year, the firsthalf of the current fiscal year was also significantly impacted in a fallback.
As reference, in the previous fiscal year, the high demand for the
replacement to the DX (successor product) and the shift to the cloud service
led to the second-highest levels of sales and operating profit in the

19/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022
Company’s history, following FY 2020 (when there was high demand
driven by two events, the consumption tax revision and the termination of
Windows 7 support).

w Sales increased in all four
categories excluding the
products.

Regarding the increase or decrease in sales caused by each of the five sales
categories from the first half of FY 2022 to the first half of FY 2023, sales
increased in the following four categories: solutions by Y352 million(+73.2% YoY), cloud by Y264 million (+10.2% YoY), merchandise by
Y55 million (+33.4% YoY), and maintenance by Y41 million (+2.5%
YoY). In contrast, sales of products decreased sharply by Y1,160 million(-67.6% YoY) in a fallback from the event-driven high demand, being thesingle factor that caused the overall sales decline (-Y446 million).

w The solutions and thecloud businesses
performed well.

Regarding the solutions, sales declined in the previous fiscal year since theCompany focused on the products’ sales and could not devote resources tosales of other companies’ products. This fiscal year, though, sales rosesignificantly in a rebound from that as well as due to strengthened sales
efforts. Regarding the cloud, the business continued to be supported by theincrease in the number of companies using PCA Cloud.
w Sales of maintenance also
increased slightly. Sales of
products declined, and the
proportion of sales of thesubscription businesses
increased to over 70%.
w High level of net increasein the number of users of
the cloud service in theprevious fiscal year.
w This fiscal year, too, therate of net increase has
been at a high level. In
November, the number ofcorporate users surpassed
20,000.

Subscription-Based Business
The proportion of the subscription-based revenue to total sales, which is a
key indicator for the Company, rose sharply from 64.2% in the first half ofthe previous fiscal year to 73.5% in the first half of this fiscal year, as salesof the cloud increased while sales of the products declined significantly.
Cloud
The number of corporate users of PCA Cloud reached 10,000 in Jan 2018.
The number has then been increasing steadily, from 12,070 at the end of
March 2019, 14,327 at the end of March 2020 (+2,257 compared to the endof the previous fiscal year), 16,444 at the end of March 2021 (+2,117),
19,152 at the end of March 2022 (+2,708, a high level of annual net
increase), and 19,853 in September 2022 (+701 in half a year) to over
20,000 in November 2022 (Figure 12).
【Figure 12】Change in the Number of Companies Using PCA Cloudand the Sales of PCA Cloud (yearly change)
25,000

Sales of the cloud service (right axis: million yen)
Number of corporate users of PCA Cloud (left axis:
companies)

Nov 2022
20,000companies

20,00015,00010,0009,000
8,000

Jan 2018
10,000companies

7,000
6,000
5,000

10,000

4,000
3,000

5,000

2,000
1,000

0

0
FY
FY
FY
FY
FY
FY
FY
FY
FY
FY
FY
FY
FY
FY
FY
FY
FY
FY
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
E
E
E

(Note) Sales from FY 2008 to FY 2010 have not been disclosed. Estimates are partially included in the number of corporate
users of PCA Cloud.

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary. (E)represents estimates/forecasts made by Alpha-Win Research Dept.

20/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022
As a result, the cloud’s sales have also been expanding from Y1,496 million
in FY 2017 → Y1,854 million in FY 2018 (+Y358 million or +23.9% YoY)
→ Y2,452 million in FY 2019 (+Y598 million or +32.3% YoY) → Y3,374
million in FY 2020 (+Y922 million or +37.6% YoY) → Y4,057 million in
FY 2021 (+Y683 million or + 20.2% YoY) → Y5,568 million in FY 2022
(last fiscal year; +Y1,511 million or + 37.2% YoY). The cloud businessalso partially experienced an event-driven high demand in the previous
fiscal year and its amount and rate of sales growth had somewhat increased.

w In the previous fiscal year,
there was an event-driven
high demand for
replacement from the X
series to the cloud service,
which accelerated thecloud’s sales growth rate.

Current Situation of the Cloud Business
The monthly average net increase in the number of corporate users of PCA
Cloud (YoY: the net increase in the number over the past 12 months
compared to the end of the previous fiscal year ÷ 12 months) has beenslowing down from approximately +171 companies/month in FY 2021 and+226 companies/month in FY 2022 to approximately +172
companies/month in the first half of the current fiscal year. Regarding thenumber of corporate users during each quarter, the net increase in thenumber compared to the previous quarter (QoQ) had hit a bottom in thisfiscal year’s Q1 (net increase in the number over the past three months
compared to the end of the previous quarter ÷ three months; +289÷3 = +96
companies/month), but then recovered in Q2 (similarly, +412÷3 = +137
companies/month). The number of users seems to be increasing in thesecond half, too, at a net rate of about +130 companies/month YoY.

w The cloud’s growth
momentum has somewhat
declined, partly due to thefallback from the previous
fiscal year.

For the time being, the Company aims to gain approximately 2,000
corporate users per year (+167 companies/month). As reference, about 40%of the total number of new contracts are with new customers.
The cloud service’s number of users and sales are still increasing, but thegrowth rate and the number or amount of increase are slowing down in Q1,
Q2, and the first half of this fiscal year both on a YoY and QoQ comparison.
In the second half, the Company projects sales of Y3,255 million, an
increase of only 9.5% YoY (+Y282 million). The momentum is somewhat
declining (Figure 13).
【Figure 13】Change in the Number of Companies Using PCA Cloud and the Sales of PCA Cloud(semi-annual and quarterly changes)
Cloud

As of the end of (period)

Number of corporate users of PCA Cloud (units: number of companies or change in the number)
Current number of accounts(unit: number of companies)

Sep 2022 (Q2)19,853

Jun 2022 (Q1)

19,441Mar 2022 (Q4)

19,152

Dec 2021 (Q3)18,578

Sep 2021 (Q2)

17,785YoY Change(unit: change in the number ofcompanies)
2,068

QoQ change(unit: change in the number ofcompanies)

Sales of PCA Cloud
Quarterly sales of
PCA Cloud(unit: million yen)

YoY change(unit: %)QoQ change(unit: %)

412

1,499

11.9

10.1

289

1,361

8.5

-10.7

574

1,524

41.6

5.2

793

1,449

40.4

8.1

1,340

35.1

6.8

1,255

31.1

16.6

1,076

14.0

4.3

1,032

19.7

4.0

992

23.4

3.7

957

25.3

1.4

944

37.0

9.5

862

36.0

7.2

804

37.4

5.2

764

40.4

10.9

689

35.4

8.7

634

33.8

8.4

585

30.9

7.5

Jun 2018 (Q1)

544

28.3

6.9

Mar 2018 (Q4)

509

38.1

7.4

Dec 2017 (Q3)

474

31.5

6.0

Sep 2017 (Q2)

447

27.1

5.4

Jun 2017 (Q1)

424

22.1

15.1

2,708
2,523

Jun 2021 (Q1)
Mar 2021 (Q4)

16,4442,056

Dec 2020 (Q3)
Sep 2020 (Q2)

15,262

1,919

Jun 2020(Q1)Mar 2020 (Q4)

14,3882,075

Dec 2019 (Q3)
Sep 2019 (Q2)

13,343

Jun 2019 (Q1)
Mar 2019 (Q4)

12,313

Dec 2018 (Q3)
Sep 2018 (Q2)

11,331

2,012(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary and financial results briefing materials.

21/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)
w The change in the methodof aggregation also caused
the sales growth rate to
decline. A growth rate ofmore than 20% YoY has
essentially been
maintained.

Issued: 12/19/2022
The following four factors seem to have been responsible for this decline
in momentum:(1) As already mentioned, in the previous fiscal year, there was an eventdriven high demand for the products due to replacement with the DX
series following the end of support for the X series. There has also beena shift from the X series to the cloud service. The Company experienced
a fallback from these in the first half of the current fiscal year, which islikely to continue through the second half.
(2) Due to a change in the sales aggregation method (see supplemental
information below), cloud’s sales for the first half of the current fiscal
year have been reduced compared to the previous method.
(3) The rates of change appear to be becoming smaller with the expansionof business scale (number of current users of the cloud service).
(4) With the worsening macroeconomy, such as the weak yen, inflation inresource and material costs as well as labor costs, and the rebound of
COVID-19, some industries are experiencing business closures,bankruptcies, and financing issues. As a result, the Company has started
to see cancellations by some of its users.
(1) and (2) were especially significant factors. The Company hascommented that when adjusted for (2), the cloud’s sales growth rate in thefirst half of this fiscal year (YoY) was essentially maintained at more than
20%, instead of the 10.2% increase as shown in the results.
The Company expects a sales growth of 13.8% YoY in the second half of
this fiscal year compared to this first half. Assuming that the change in theaggregation method will cause the same effect in the second half of thisfiscal year, it is estimated that the Company will continue to essentially
increase sales by approximately 15-20% per year (YoY).
The Company’s cloud service seems to be maintaining a high growththanks to the digitization of small/medium-sized companies, the economic
rationality and increased recognition of cloud services, and theenhancement of options.

Supplemental Information: Impact of the Change in the Method
for Aggregating the Sales of the CloudIn the previous fiscal year, more sales tended to be aggregated as the cloud’s
sales due to partial allocations during the process of calculating the sales ofeach category. However, from the first half of the current fiscal year, theCompany began aggregating sales based on each individual sales to moreclearly recognize the sales of the cloud.
As a result, sales for the first half of this fiscal year are estimated to havebeen decreased by approximately Y250 million compared to the previous
method in the last fiscal year (the amount that was decreased appears tohave been transferred to the solutions’ sales, and consequently there is noeffect on overall sales).
Taking this into account, the sales of the cloud are estimated to have beensolid at Y3.1 billion in the first half (an increase of more than 20% YoY).
In any case, the cloud’s half-year sales remained at a high level.
w Rate of sales growth isexpected to remain at 1520% per year for the
meanwhile.

The slowdown in momentum cannot be denied when compared to thecloud’s past rate of increase in sales and in the number of corporate users.
However, since the current situation is partly caused by the fallback fromthe event-driven high demand, the Company is expected to continue toincrease sales at a rate of about 15% to 20% per year for the time being.

22/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022
ProfitFactors that increased or decreased consolidated operating profit in the firsthalf are shown in Figure 14. Of the overall decrease in operating profit (netamount) of -Y906 million, the largest factor was the decline in sales (-Y446
million), which accounted for 49% of the total decline. This was followedby other manufacturing expenses (-Y206 million, mainly due to an increasein subcontracting costs), which was caused by the increase in development
expenses and accounted for 23% of the total decline. Lastly, the increase in
the cost of the cloud (-Y148 million) accounted for 16% of the decline.

w Profit decreased due tolower sales and higher
R&D and personnel
expenses.

The gross margin worsened by 4.7 percentage points from 68.2% in thefirst half of last fiscal year to 63.5% in the first half of this fiscal year. Thiswas due to the worsened product mix caused by lower sales of the products,
which have a high marginal profit ratio, and due to greater upfront
investments including those for product development.
In addition, due to an increase in other SG&A expenses (-Y155 million,
mainly due to higher personnel expenses), R&D expense (-Y92 million),and sales promotion and advertising expenses (-Y64 million), the SG&A
expenses increased by Y312 million, or 11.3%, from Y2,753 million toY3,065 million in the same order as above. As a result, the SG&A expenses
ratio also rose by 8.0 percentage points from 41.7% to 49.7%.

w Operating margin was
halved due to lower grossmargin and higher SG&A
expenses ratio.

Consequently, the operating margin was almost halved from 26.5% to13.7%. With the sales decline, too, both the amount and rate of decline inoperating profit became large.
Furthermore, while a gain on sales of securities (+Y670 million) wasrecorded as an extraordinary income in the previous fiscal year, no suchgain is present in the current fiscal year. As a result, net profit resulted in asimilar decline.

w In the previous fiscal year, again on sales of securities
was recorded as an
extraordinary income, but
this will no longer bepresent in the current fiscal
year.

【Figure 14】Factors that Increased/Decreased Operating Profit in the First Half(millionyen)

Operating
ProfitSales

Cost of Sales

3,000

Operating
ProfitSG&A Expenses

Increase

Decrease

-206

−64

2,500

2,000

1,753
207

1,500

-446
1,000

-148

847

-92
−155

500

0

FirstAHalf
FY 2022A
Decreasein
sales

A in cost
Increaseof cloud

A in cost of
DecreasepurchaseA
Increaseinothermanufacturing
expensesA
Increase in sales
promotion andadvertisingexpensesA
Increasein
R&D expense

A in other
Increase
SG&A expenses

A HalfFirst
FY 2023(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials.

23/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022◆ PCA’s Financial Forecast for the Second Half of FY
2023
w Sales in the second half are
expected to remain flat
YoY.
w However, as in the first
half, a significant decreasein profit is expected due toincreased costs.

w Estimates used in theforecast for the second half
are conservative comparedto the results of past years.

Summary of the Forecast for the Second Half
The Company has not made changes to its initial full-year forecast.
Therefore, the Company’s forecast for the second half, which is calculated
by subtracting the first-half results from the full-year forecast, would be as
follows: sales are expected to be Y6,764 million (-Y8 million or -0.1%
YoY), which is about the same level as the second half of the previous fiscal
year, while operating profit is predicted to be Y253 million (-Y649 million
or -72.0% YoY) and net profit is predicted to be Y144 million (-Y773
million or -84.3% YoY). As in the first half of this fiscal year, it expects
significant declines in profits due to higher costs (Figure 15).
Second-half sales and operating profit are expected to account for 52.3%
and 23.0% of the full fiscal year’s total, respectively. The second half’s
proportion of the total over the past 10 years through the previous fiscal
year was 54.7% and 56.9%, respectively, on average. The proportion is
expected to be about 2 percentage points lower for sales and 34 percentage
points lower for operating profit.

【Figure 15】Financial Forecast for the Second Half of FY 2023 (the Company’s plan)
Second-Half Financial Performance
Results and Forecasts

Second Half of FY 2022

Second Half of FY 2023: CE% ChangeAmount of Change% of Total Sales

Unit: million yen

Oct 2021 - Mar 2022

Oct 2022 - Mar 2023

YoY: %

YoY: million yen%

Consolidated Sales

Sales by Category

Products
Merchandise
Maintenance Service
Cloud Service
Other Operating Revenue

Gross Profit
Gross Margin (%)
SG&A Expenses
SG&A Expenses Ratio (%)
Operating Profit
Operating Margin (%)
Recurring Profit
Recurring Margin (%)
Net Profit
Net Margin (%)

6,772

6,764

-0.1

-8

100.0

1,236

842

-31.9

-394

12.4

272

180

-33.8

-92

2.7

1,670

1,569

-6.0

-101

23.2

2,973

3,255

9.5

282

48.1

622
4,302
63.5
3,400
50.2
902
13.3
914
13.5
917
13.5

918
3,932
58.1
3,679
54.4
253
3.7
261
3.9
144
2.1

47.6
-8.6

296
-370
-5.4
279
4.2
-649
-9.6
-653
-9.6
-773
-11.4

13.6

8.2
-72.0
-71.4
-84.3

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials.

w While the second half will
also be impacted by thelack of event-driven highdemand, this will be offset
by the continued growth ofthe cloud and recovery of
the solutions. Sales are
expected to remain flat
YoY.

Forecast for the Second Half (by sales category)In the second half, a fallback from the event-driven high demand is
expected like in the first half. The product’s sales are expected to fall toY842 million (-Y394 million or -31.9% YoY). However, as alreadymentioned, the event-driven demand had become smaller in the second halfof the previous fiscal year compared to its first half (1.0 to 1.2 billion yen→ 0.5 billion yen), so there should be a smaller impact on the second halfof the current fiscal year too. Due to the slow recovery of the product’s sales,
the Company also expects the sales of merchandise and maintenanceservice to decline by Y92 million (-33.9% YoY) and Y101 million (-6.0%
YoY), respectively, compared to the previous fiscal year’s second half.
24/41This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022
On the other hand, sales of the cloud and solutions are expected to increasesteadily, offsetting declines in the other segments. The Company
consequently expects sales in this second half to be about the same as thesecond half of the previous fiscal year. The sales decline rate is planned to
be improved from 6.7% in the first half to 0.1% in the second half.

Forecast for the Second Half (profit)
While sales will remain flat, gross profit is expected to decline by Y370
million (-8.6%) from Y4,302 million to Y3,932 million in the order of last
fiscal year’s second half to this fiscal year’s second half (the same order forthe rest). This is because it expects an increase in development-related
expenses under other manufacturing expenses (factors causing a decreasein profit: increase in subcontracting cost by Y250 million and R&D expense
by Y110 million) and higher cost of purchase. Consequently, the grossmargin is expected to decline by 5.4 percentage points from 63.5% to58.1%.

w Profit margins are expected
to worsen due to increased
subcontracting, R&D, andpersonnel expenses.

In addition, the SG&A expenses are expected to increase by Y279 million,
or 8.2%, from Y3,400 million to Y3,679 million, due to an increase in R&D
expense for future growth (factor causing a decrease in profit: -Y115
million YoY), commissions paid to distributors (similarly, -Y102 million),and internal DX14 acceleration expense (similarly, -Y100 million). In
consequence, the SG&A expenses ratio is expected to rise by 4.2
percentage points from 50.2% to 54.4%, and the operating margin is
expected to decline by nearly 10 percentage points from 13.3% to 3.7%. As
reference, the operating margin in this fiscal year’s Q1 and Q2 was 10.5%
and 16.8%, respectively, from which the margin is expected to decline
sharply.

(14） DX: stands for Digital
Transformation. The changes
in lifestyles and businesses
brought about by digitaltechnologies.

In addition, as in the first half, the gain on sales of securities which werealso recorded in the second half of the previous fiscal year will no longer
be present in the second half of this fiscal year, resulting in an expected
84.3% decline in net profit.
【Figure 16】Factors that Are Expected to Increase/Decrease Operating Profit in the Second Half of FY 2023
(the Company’s plan)(million yen)

1,800
1,600

Operating
ProfitSales

Cost of Sales

Operating
ProfitSG&A Expenses

1,400
1,200
1,000

28

902
-8

800

-55

600

Increase

400

Decrease

-336

-102
-115

200
0

SecondA Half
FY 2022(result)

Decrease
in
A
sales

Decrease
A incost of cloud

Increase
A in costof purchase, etc.

Increase
A in
othermanufacturing
expenses

Increase
A incommission
expenses

IncreaseA in
R&D expense

253
-61

IncreaseinAother SG&A
expenses

SecondA Half
FY 2023(forecast)(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials.

25/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022◆ PCA’s Full-Year Financial Forecast for FY 2023
w For the current fiscal year,
the Company forecasts aslight decrease in sales but asignificant decrease inprofit.

Summary of the Full-Year Forecast
The Company has maintained its full-year financial forecast for FY 2023
(this fiscal year) that was announced at the beginning of the fiscal year. It
is expecting a slight sales decline and significant profit drops: sales ofY12,927 million (-3.4% YoY), operating profit of Y1,100 million (-58.6%
YoY), recurring profit of Y1,132 million (-58.0% YoY), and net profit of
Y639 million (-73.0% YoY) (Figure 17).

【Figure 17】Full-Year Financial Forecast for FY 2023 (the Company’s plan)
Consolidated(unit: million yen)
Sales
Products
Merchandise

Sales byCategory

Maintenance Service
Cloud Service
Other Operating Revenue

Gross Profit
Gross Margin

SG&A Expenses
SG&A Expenses Ratio

Operating Profit
O.P. Margin

Recurring Profit
R.P. Margin
Net Profit Attributable to Owners of the Parent

N.P. Margin
Annual Dividend Per Share (yen)FY 2022

FY 2023: Company Forecast

New RevenueRecognition Standard

New Revenue-Recognition
Standard

YoY: simple diff. inamount / diff.

13,382
2,954
439
3,316
5,568
1,103
8,809
65.8%
6,153
46.0%
2,655
19.8%
2,697
20.2%
2,367
17.7%
24.0

12,927
1,399
402
3,257
6,115
1,752
7,845
60.7%
6,744
52.2%
1,100
8.5%
1,132
8.8%
639
4.9%
13.0

-455
-1,555
-37
-59
547
649
-964
-5.1%
591
6.2%
-1,555-11.3%-1,565-11.4%-1,728-12.7%-11.0

YoY: simple %change-3.4%-52.6%
-8.4%
-1.8%
9.8%
58.8%
-10.9%
9.6%-58.6%-58.0%-73.0%(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials

w The Company maintained
its full-year forecast made at
the beginning of the fiscal
year.

Summary of the Full-Year Forecast (sales)
The Company has not changed its full-year sales forecast from its initial
forecast made at the beginning of the fiscal year.
By sales category, the Company expects the product’s sales for the full year
to decline by half or by Y1,555 million to Y1,399 million, due to the lackof event-driven high demand for the products that had occurred in theprevious fiscal year (Figure 17, and Figure 18 on page 27). Also, despite
their sales growth in the first half, sales declines are expected formaintenance (shift to the cloud) and merchandise (shift to paperless
operation and digitalization) in the second half due to structural changes.
For the full year, net declines are expected for their sales at about the samepace as in past years.
On the other hand, sales of other companies’ products are expected torecover in the current fiscal year, with a significant increase in the sales ofsolutions (sales of Y1,752 million; +Y649 million or +58.8% YoY).
Similarly, the Company plans to increase sales of the cloud business (salesof Y6,115 million; +Y547 million or +9.8% YoY) by strengthening the
product lineup.

26/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022
As a result of the above, the percentage of the subscription businesses’ sales
in the full-year sales is expected to become 72.5%, exceeding 70% for thefull year for the first time in the Company’s history. During the past periodof fallback from an event-driven high demand (FY 2015 and FY 2016), theCompany had posted net losses. However, it has shifted its core businessmodel to stable, subscription-based businesses since then. Therefore, evenduring the current period of fallback from an event-driven high demand,sales are not expected to decline significantly. Furthermore, even withstrategic increases in upfront investments, operating profit is expected to be
maintained at more than Y1 billion. The Company’s management efforts todate seem to have strengthened its business foundation.

w The proportion ofsubscription-based sales
for the full year is also
expected to be over 70%.
w Due to the change inbusiness model, theCompany expects to secure
an operating profit of overY1 billion even with the
fallback from the eventdriven high demand.

【Figure 18】Forecasted Sales Breakdown by Category in FY 2023 (full year) (company plan)
Cloud

Maintenance

Solutions

Merchandise

Products

Previous
AccountingStandard

16,00015,213

New AcxcountingStandard

YoY Change% of Total

14,266
14,00010,000

9,360
8,440

8,000

1,767

854
1,639

955
1,740

9,785

2,516

1,954

563

988

3,098

1,985

439

2,954

485
2,713

439

12,927

97.1％

1,399

47.3％

402

91.6％

1,752

105.8％

3,257

98.2％

3,109

1,152

1,496

1,854

3,518

3,316

3,552

72.5%

3,124

FY 2016

FY 2017

FY 2018

2,452
FY 2019109.8％

3,374

FY 2020

27.5%

1,103

3,227

3,471

2,000

0

13,382

2,781

1,878

4,000
3,026

3,701

2,975

5,568

5,568

FY 2022

FY 2022

6,115

SubscriptionBased-Revenue

6,000

2,069

552

13,308

One-Time-PaymentBased Revenue

11,43912,000

3,166

4,057

FY 2021

FY 2023
CE(Ref) Prepared by Alpha-Win Research Dept. based on excerpts from the financial results briefing materials and financial results summary. (CE)is the Company’s forecast.
(Note) Since the accounting standard for the posting of sales as merchandise or solutions had been partially changed in FY 2020, adjustments
were retroactively made for FY 2019 according to the new standard. However, for the two categories, there is no continuity with the years before
FY 2019. Also, starting in FY 2022, the new revenue-recognition standard, etc., have been applied. “% of Total” is also for the Company’s
forecast for FY 2023.

Summary of the Full-Year Forecast (profit)
An analysis of the factors that are projected to cause an increase/decrease(YoY) in consolidated operating profit for the current fiscal year is shownin Figure 19 on page 28.
w Greater upfront
investment, including
investment in thedevelopment of PCA Hub,is the main reason for the
expected decline in profit.

In addition to the decline in sales of the products, another major factor
causing profit to decrease is the greater upfront investments aimed atstrengthening development capabilities for the next stage of growth. The
Company plans to increase investment and research expenses byapproximately Y700 million (increased maintenance expense + increased
R&D expense), including those for its existing products’ maintenance,
version upgrades, and various support and particularly for investment in thedevelopment of the PCA Hub series.

w Developing andstrengthening new
products and services for
future growth.

The Company believes that in order to strengthen its new products andservices and develop the businesses as its future growth drivers, increasing
and enhancing its R&D expense, development personnel, andsubcontractors are necessary even amidst declining sales and profits.

27/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022
In addition to higher development expenses, the increase in personnel
expense (+Y129 million YoY), other expenses (+Y253 million YoY), andcost of the cloud (+Y119 million YoY) is also expected to be factors thatwill decrease profit. Costs are expected to increase since investments andexpenses necessary for future growth will be resumed in full scale this fiscal
year, although they had been held off during the COVID-19 crisis (seminars
and events).

w The gross margin is
expected to decline, the
SG&A expenses ratio is
expected to rise, and theoperating margin is planned
to decline by 11 percentage
points.

The gross margin for the full fiscal year is expected to decrease significantly
from 65.8% in the previous fiscal year to 60.7%.
SG&A expenses are expected to increase by Y591 million YoY (+9.6%
YoY) to Y6,749 million, and the SG&A expenses ratio is expected to risefrom 46.0% in the previous fiscal year to 52.2% in the current fiscal year.
With the increase in the SG&A expenses ratio, the operating margin is
expected to decline significantly from 19.8% to 8.5%. No major
extraordinary income or losses are expected for this fiscal year.

【Figure 19】Factors that Are Expected to Increase/Decrease Operating Profit in FY 2023 or this fiscal year(the Company’s plan)(million yen)

4,000
3,500
3,000

OperatingprofitSales

Cost of sales

Increase

2,655

2,500

OperatingprofitSG&A expenses

Decrease

153
-454

2,000

-119
-542

1,500

-129

1,100

-207
-253

1,000
500
0

FY 2022
A
ResultDecrease
in
A
sales

Decrease
A in costof cloud

Increase
A in costof purchase, etc.

IncreaseA inmaintenanceexpenseIncrease
A in
personnel
expenseIncreaseA in
R&D expense

IncreaseinAother SG&A
expenses

FYA2023
Forecast(Ref) Prepared by Alpha-Win Research Dept. based on excerpts from the financial results briefing materials.

28/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022◆Alpha-Win Research
Forecast for FY 2023

Dept.’s

Full-Year

Financial

Overview
In the current fiscal year, we believe that a temporary decline in sales andprofits is inevitable since the Company will increase upfront investments,
as it increases development investment and the number of employees
toward the next stage of growth, and since there will be a fallback from theevent-driven high demand of the previous fiscal year. However, theCompany’s forecasts for costs and profit margins seem somewhat
conservative and we believe that they will most likely exceed the plan.

w Declines in sales andprofits are inevitable thisfiscal year due the fallback
from the event-driven highdemand and the upfront
investments.

Previously, expecting slight upward revisions to both sales and profit
compared to the Company’s plan, we had expected sales of Y12,950
million (+Y23 million compared to the Company’s plan), operating profitof Y1,300 million (similarly, +Y200 million), and net profit of Y700
million (similarly, +Y61 million) for this fiscal year.
w We have upwardly revised
our forecast for this fiscal
year. The Company's profit
forecast could be revised
upward.

We have now reviewed and revised our forecasts for the current fiscal year,
keeping sales unchanged from our previous forecast (as of the report issued
on July 4, 2022), while upwardly revising the forecasts for operating profit,
recurring profit, and net profit by Y100 million each (Figure 20). We havealso revised dividend upward from 13.0 yen/share to 16.0 yen/shareaccordingly.
Our new forecasts are as follows: sales of Y12,950 million (±0 comparedto our prevoius forecast or +Y23 million compared to the Company’s plan),
operating profit of Y1,400 million (similarly, +Y100 million or +Y300
million), and net profit of Y800 million (+Y100 million or +Y161 million).

【Figure 20】Financial Forecast for FY 2023 or this fiscal year by Alpha-Win Research Department
Consolidated(unit: million yen)
New Revenue-Recognition Standard

Sales
Products
Merchandise

Sales byCategory

Maintenance Service
Cloud Service
Other Operating Revenue

Gross Profit
Gross Margin

SG&A Expenses
SG&A Expenses Ratio

Operating Profit
O.P. Margin

Recurring Profit
R.P. Margin
Net Profit Attributable to Owners of the Parent

N.P. Margin
Annual Dividend Per Share (yen)FY 2023: Alpha-Win Research Department's Forecasts

FY 2022

FY 2023

Results

Company Forecast: CE

13,382
2,954
439
3,316
5,568
1,103
8,809
65.8%
6,153
46.0%
2,655
19.8%
2,697
20.2%
2,367
17.7%
24.0

12,927
1,399
402
3,257
6,115
1,752
7,845
60.7%
6,744
52.2%
1,100
8.5%
1,132
8.8%
639
4.9%
13.0

Alpha-Win's Forecast: E

12,950
1,300
400
3,250
6,200
1,800
8,000
61.8%
6,700
51.7%
1,400
10.8%
1,420
11.0%
800
6.2%
16.0

Alpha-Win's Forecast - Company Forecast

23
-99
-2
-7
85
48
155
1.1%
-44
-0.4%
300
2.3%
288
2.2%
161
1.2%
3.0

% Difference (E/CE)

0.2%
-7.1%
-0.5%
-0.2%
1.4%
2.7%
2.0%
-0.7%
27.3%
25.4%
25.2%

YoY: Difference in Amount-432-1,654
-39
-66
632
697
-809
-4.1%
547
5.8%
-1,255-9.0%-1,277-9.2%-1,567-11.5%-8.0

YoY: % Change-3.2%-56.0%
-8.9%
-2.0%
11.4%
63.2%
-9.2%
8.9%
-47.3%-47.3%-66.2%

Alpha-Win's Old Forecast

12,950
1,300
400
3,250
6,600
1,400
8,000
61.8%
6,700
51.7%
1,300
10.0%
1,320
10.2%
700
5.4%
13.0

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials. CE: company forecast/estimate. E: Alpha-Win’s
forecast/estimate. “Alpha-Win’s Old Forecast” is our forecast as of July 4, 2022.

w There was large progress inthe first half, and theforecasted costs and profits
for the second half seem
conservative.

There are some concerning points such as the sluggish sales of the products
and the increasing costs (including R&D investment and personnel
expense). However, we have made the above revisions since there was large
progress with profit in the first half, the event-driven high demand occurred
mainly in the first half of the previous fiscal year and its impact is expectedto ease in this second half, the cloud business has been solid as it isessentially maintaining a double-digit sales growth, and the Company’s
forecasts for second-half costs and profits seem conservative. The
Company has commented, though, that it may control costs depending onchanges in revenue. So if profits swing upward, it may also increase theexpenses to some extent (e.g., sales promotion, personnel, and development
expenses).

29/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

w クラウドの増収率前提が、やや保守的。

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

w Regarding sales forecast by
category, we reduced thesales of the cloud to reflect
the change in the methodof sales aggregation. On
the other hand, we raised
the sales of solutions.
w We expect the cloud’s sales
to essentially increase by
20% YoY.

Issued: 12/19/2022
We have, however, taken the above factor into account to some extent inmaking our profit forecast for the current fiscal year. In making the financial
forecasts, we did not include the possibility of M&As or nonoperating andextraordinary income/losses during the period.

Sales by Category
While the overall amount of sales do not differ significantly between our
forecast and the Company’s plan, there were differences in the sales of eachcategory, especially for the cloud, solutions (other operating revenue), andproducts. However, this difference became smaller upon reflecting thechange in the sales aggregation method between the cloud and the solutions .
The Company forecasts that the full-year sales of the cloud will be Y6,115
million, at an increase of Y547 million YoY (+9.8%). However, we had
previously seen this as a conservative forecast, considering the continued
growth of the PCA Cloud and X’sion (cloud version of the work
management software), trends through the previous fiscal year (simple
average of the annual sales growth rate over the past five years: approx.
+30%), and the current situation. Therefore, estimating the sales growthrate to be +20% YoY, we had previously forecasted that the cloud’s sales
will be Y6,600 million (+Y485 million compared to the Company’s plan).
In the current forecast, though, we have reflected the change in theaggregation method and revised our forecast of cloud’s sales to Y6,200
million (on the surface, +Y85 million or +1.4% compared to the Company’splan and +Y632 million or +11.4% YoY) (Figure 20 on page 29).
On the other hand, while the Company expects sales of solutions for thisfiscal year to grow by Y649 million (+58.8% YoY), we had previously
forecasted its sales to be Y1,400 million (+Y297 million YoY), which was
Y352 million less than the Company’s forecast. For similar reasons, wehave now raised this forecast to Y1,800 million (+Y48 million or +2.7%
compared to the Company and +Y697 million or +63.2% YoY).

w The impact of theworsening macroeconomy
on corporate earnings andIT investment interests is arisk factor.

w Since the Company
benefits from digitalizationand the work-style reform,
the risks are limited.

w Increased cost, intensifying
competition, slower growthrate of the cloud, anddelays in the monetizationof the new businesses arerisk factors.

Risk Factors to Financial Performance
The main risk factors to the medium-term financial forecast including thisfiscal year are the weak yen, stagnation of economic activities due to arebound and prolongation of COVID-19 which had seemed to be settling
down, and the inflation and logistics disruption caused by the Russian
invasion of Ukraine which will cause corporate users to refrain from
replacing products and services or postpone their implementation due toworsening business performance.
However, the existing services of the Company’s group have a high affinity
with remote work and work-at-home in terms of the Company’s businessand operations, and they also benefit from the digitization and work-stylereforms of companies and the society. Business performance was solid in
both the previous fiscal year and the year before that, and the worsening
macro environment will mostly likely not cause a direct, major impact on
the Company in the current fiscal year either. Therefore, the risks seem tobe limited.
Other risks include futher increases in costs due to rising personnel,
development, and subcontracting expenses, market penetration of the cloudbusiness coming to an end of a phase, slower growth rates due tointensifying competition with competitors, and delays in monetizing the
new businesses.

30/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022

7． Growth Strategy◆ Medium- to Long-Term Vision and Policy
w Long-term vision is tobecome a “Management
Support Company”
focused on the
management-support
business for its corporate
customers.

Long-Term Vision
The PCA Group’s long-term vision through FY 2031, when it will reach its
50th anniversary, is as follows: “By providing a greater variety of one-stop
services for corporate management and operation, we will become a true
“Management Support Company” that is focused on the managementsupport business for our corporate customers.”

w Created a new mediumterm plan. For sustainablegrowth, it will strengthen
its development capability,
build its businessfoundation, and transform
its business structure.

New Medium-Term Management Plan
The Company has been creating medium-term management plans for threeyear spans, and in April 27, it announced a new medium-term management
plan that starts this fiscal year (FY 2023 to FY 2025) (no change since theannouncement). Its medium-term basic policy is to “transform the businessstructure and build the foundation for continuing and developing businesses
that are both long-term and stable” and aims to “optimize the company’s
structure for creating customer-oriented new businesses, products, andservices ahead of changes in the society.”w Will continue and develop
its previous medium-termplan and execute fourpriority measures.

To provide total solution services centered on software, it has set fourpriority measures as shown in Figure 21 (items I through IV). It is currently
working on various measures toward the achievement of its plan.

【Figure 21】Growth Strategy and Priority Measures of the New Medium-Term Plan

I. Establish a strong revenue base for the core businesses

Greater earning power throughcontinuous growth

1. Further expand the cloud business: strengthen and promote sales of PCA CloudWith a focus on PCA Cloud / on AWS, meet demands related to new ways of working such as remote workwith flexibility.

2. Promote the shift to the subscription-based business modelWith a focus on PCA Subscription, switch from sales of packaged on-premises software to thesubscription services.

3. Greater digital customer success
Effectively meet the direct needs of customers and pursue greater customer success to improve contract
success rate and customer retention rate.

II. Create new business opportunities

For the development of the next core business andthe future

Conduct applied research on fundamental technologies such as AI (enabling linkage between corebusiness operations and peripheral operations and automating data entry), find and create new areas ofbusiness (materialize ideas, seeds, and customer needs), and launch the PCA Hub service (respond to DX
needs to develop the service into a new source of earnings)

Gain greater competitive edge andIII. Strengthen our monozukuri (creation of things) with a differentiate through modernized software
focus on safety, security, and anticipation of needs
development
Digital (support DX of operation), Service (fast service development and release from a user-oriented
approach), and Modern (strengthen development system, expand the PCA Hub series, and modernize inthe area of enterprise systems)

IV. Strengthen the management foundation for a highly profitable structure For sustainable growth
Build and leverage the foundation for DX acceleration, strengthen IT governance and security measures,and create an environment for active engagement by a diverse workforce(Ref) Based on the financial results briefing materials, partially edited by Alpha-Win Research Dept. with supplementary information.

31/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022
The priority measures have been developed based on the previous mediumterm plan. To achieve sustainable growth, the Company plans to strengthen
the subscription-based business model centered on the cloud business as its
revenue base, strengthen its development and service systems to create a
new source of earnings, support the DX of operations of small/mediumsized companies, also work on its own DX, and strengthen its managementfoundation such as its governance and corporate structure.

w Main points are tostrengthen thesubscription-based
business model, respond todigitalization needs, createbusiness opportunities, andstrengthen its development
and service system as wellas management foundation.

◆ Management Indicators Set as Goals
Numerical Goals of the New Medium-Term Plan
In the previous medium-term plan, the Company made decent progress as
it achieved its numerical goals even after their upward revisions.
Consequently, it has set the following seven items as its numerical targets
for the current medium-term management plan from the perspectives ofbusiness performance, capital efficiency, and shareholder return (Figure 22).

w As numerical goals of themedium-term plan, seven
items have been set fromthe perspectives of businessperformance, capitalefficiency, and shareholder
return.

Aside from the two items related to sales, all figures have already beenachieved in the past during periods of event-driven high demand, and may
become achieved again. However, they seem to be somewhat high goals
unless it conducts an M&A of a certain scale or there is an event-driven
high demand.

w 当調査部では、中期の年間利益成長率を 5~8％予想。

【Figure 22】Goals, Progress, and Forecasts for the Medium-Term Management Plan
Y15 billion or more

Approx. Y13 billion

Approx. Y14.3 billion (FY 2020)

Goals and Results of the Final Year of the Previous Medium-Term
Management Plan (FY 2022)
Initial Goals
Revised Goals
Results(as of April 2019)(Previous FY)
Y13.38 billion
Y11.5 billion or more
Y13.5 billion or more

Y9.5 billion or more

Approx. Y9.4 billion

Approx. Y8.9 billion (FY 2022)

Y8.88 billion

Achieve Y6 billion

Achieve Y7.5 billion

・Consolidated Operating Profit

Y2.5 billion or more

Y1.1 billion

Approx. Y2.8 billion (FY 2020)
During the past 10 years: 19.8% (FY 2022)

Y2.65 billion

Y1.5 billion or more

Y2.1 billion or more

・Consolidated Operating Margin

16% or more

8.5%

During the longest period with data available:
28.5% (FY 1999)

19.8%

10% or more

15% or more

・ROE
・DOE
・Dividend Payout Ratio

10% or more
2.5% or more
30.0%

3.8% (Alpha-Win's estimate)
1.5% (Alpha-Win's estimate)
40.7%

14.4%

14.4%
2.9%
20.3%

Goals of the Current Medium-Term Management Plan
(FY 2022 - FY 2025)

FY 2025: Company Plan

・Consolidated Sales

Business
Performance

Asset Efficiency
Shareholder
Return

Of which, are sales from the subscription
businesses (maintenance & cloud)FY 2023: Company Plan

Record High(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials. Goals are those announced by the Company.

◆ Alpha-Win Research Dept.’s Forecast of Medium-Term
Financial Results

w We updated our mediumterm financial forecasts.
Maintained our previous
forecasts for the next fiscal
year and the year after that.

In our previous report (July 5, 2022), we had reviewed our medium-term
forecasts for the three fiscal years including the current fiscal year. We have
now updated some parts of them (Figure 23).

【Figure 23】Medium-Term Financial Forecast
当調査部では、中期の年間利w

Units: million yen, %Merchandise

FY 2021
13,308
1,985
485

FY 2022
13,382
2,954
439

FY 2023: CE
12,9271,399
402

FY 2023: New E
12,9501,300
400

FY 2024: New E
14,3101,450
360

Maintenance Service

3,552

3,316

3,257

3,250

3,150

3,000

Cloud Service

4,057
3,227
60.1%
5,686
42.7%
2,314
17.4%
2,340
17.6%
1,668
12.5%

5,568
1,103
65.8%
6,153
46.0%
2,655
19.8%
2,697
20.2%
2,367
17.7%

6,115
1,752
60.7%
6,744
52.2%
1,100
8.5%
1,132
8.8%
639
4.9%

6,200
1,800
61.0%
6,500
50.2%
1,400
10.8%
1,420
11.0%
800
6.2%

7,400
1,950
62.0%
7,000
48.9%
1,870
13.1%
1,890
13.2%
1,130
7.9%

8,700
2,000
62.5%
7,150
46.1%
2,550
16.4%
2,570
16.6%
1,550
10.0%

-6.7%
-37.3%-12.1%
2.3%
20.2%-12.8%-0.2%-2.3%-16.8%-16.7%
-8.1%
11.33

0.6%
48.8%
-9.5%
-6.6%
37.2%
-65.8%
5.7%
8.2%
7.6%
14.7%
14.1%
24.00

-3.4%
-52.6%
-8.4%
-1.8%
9.8%
58.8%
-5.1%
9.6%
13.5%
-58.6%-57.1%
13.00-3.2%-56.0%
-8.9%
-2.0%
11.4%
63.2%
-4.8%
5.6%
-47.3%-47.3%-66.2%
16.00

10.5%
11.5%
-10.0%
-3.1%
19.4%
8.3%
1.0%
7.7%
33.6%
33.1%
41.3%
18.00

8.5%
3.4%
-11.1%
-4.8%
17.6%
2.6%
0.5%
2.1%
36.4%
36.0%
37.2%
19.00

益成長率を 5~8％予想。

Sales

Products

Category

Other Operating Revenue

Gross Margin
SG&A Expenses(% over sales)

Operating Profit(% over sales)

Recurring Profit(% over sales)

Net Profit(% over sales)

Sales (% YoY growth for all values)
Products
Merchandise

Category

Maintenance Service
Cloud Service
Other Operating Revenue

Gross Margin (% YoY diff.)
SG&A Expenses (% growth)

Operating Profit (% growth)
Recurring Profit (% growth)
Net Profit (% growth)
Dividend per share (yen)FY 2025: New E FY 2025 CE Medium-Term Plan
15,52015,000
1,500
320
9,500

2,500
16.7%

16.0%

Dividend Payout Ratio: 30%

FY 2023: Old E
12,9501,300
400

FY 2024: Old E
14,3101,450
360FY 2025: Old E
15,520
1,500
320

3,250

3,150

3,000

6,600
1,400
61.8%
6,700
51.7%
1,300
10.0%
1,320
10.2%
700
5.4%

7,800
1,550
62.0%
7,000
48.9%
1,870
13.1%
1,890
13.2%
1,130
7.9%

9,000
1,700
62.5%
7,150
46.1%
2,550
16.4%
2,570
16.6%
1,550
10.0%

-3.2%
-56.0%
-8.9%
-2.0%
18.5%
26.9%
-4.0%
8.9%
-51.0%-51.1%-70.4%
13.00

10.5%
11.5%
-10.0%
-3.1%
18.2%
10.7%
0.2%
4.5%
43.8%
43.2%
61.4%
14.00

8.5%
3.4%
-11.1%
-4.8%
15.4%
9.7%
0.5%
2.1%
36.4%
36.0%
37.2%
15.00

(Ref) Predicted and prepared by Alpha-Win Research Dept. New E is our current forecast/estimate and Old E is our previous forecast/estimate. CE is theCompany’s forecast/estimate.

32/41This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)
w Economic activities are
assumed to normalize
starting in FY 2023. Not
expecting event-driven highdemand.
方式。「インボイス（適格請求書）」を用いて仕入税額控除を受けるための制度。

w 種類別の売上高や、コスw We kept our forecasts for
トの前提を再考。
the next fiscal year and theyear after that the same.
Only the dividend wasrevised upward.
w We expect a long-term
annual profit growth rateof 8-10%, driven by thew 引き続きクラウドと就業
subscription business.

管理ソフトが成長ドライ
バー。オンサイトでのサポートも本格的に回復すると思われる。

Issued: 12/19/2022

Macroeconomic Assumptions
The current macroeconomic environment is unforseeable due to thedepreciation of the yen, inflation due to soaring resource prices, anddisruption of logistics. However, since the COVID-19 risk in Japan is
becoming smaller compared to the past, we predicted that people’s lives,
economic activities, corporate earnings, and IT investments bysmall/medium-sized companies will gradually normalize and improve.
Currently, we do not anticipate any high demand to occurr in response toevents such as those related to the Electronic Books Maintenance Act
coming into effect, the introduction of the new invoicing system (Qualified
Invoice Preservation Method), tax system, accounting standards, and OS or
product versions.
Estimates/Assumptions Used for Sales, Expenses, and Profit
We have not changed our forecasts for the next fiscal year and the year after
that. However, we have changed the breakdown of sales between cloud andsolutions for both fiscal years and have also raised the dividend (Figure 25
on page 36).
From the next fiscal year onward, we expect sales and profits to return to a
growth trend as upfront investments peak out, the negative impact inreaction to the past event-driven high demand diminishes, and the cloudbusiness continues to grow. Over the medium and long term, based on
normalized figures excluding the effect of the event-driven high demand,
we expect an annual sales growth rate of around 6-8% and an even greaternet profit growth rate (8-10% per year).
Since the cloud business (subscription business), which is the Company’s
core business as well as its growth driver, has a high marginal profit ratio,
sales growth will directly contribute to profit growth, resulting in an profit
growth rate will most likely exceed the sales growth rate.
Although the sales of merchandise will continue to decline with the shift topaperless operation and sales of maintenance service will keep declining
due to the shift to the cloud, we expect sales of the cloud to grow (at anannual growth rate of about 15-20%), which will also lead to improved
product mix with the increased proportion of the cloud business. In addition,
the Company is expected to shift to the subscription model for various
businesses and is working on streamlining its business. We predict thatthese will lead to an improvement of its profitability (operating margin).
Since the growth potential of the cloud and the work management software
is high, we believe that they will continue to be the growth drivers,
absorbing the increase in upfront investment, sales promotion expense, andpersonnel expense and contributing to the increase in sales and profits.

w In the medium term, thesuccess or failure of new
products and services, inaddition to the growth ofthe cloud business, willaffect earnings.

Although the growth rate is slowing down compared to the past, we believethat the Company’s subscription business centered on the cloud is in thephase of continuously and stably expanding. In addition, if the new
businesses currently underway gets on a growth trajectory, they should be
able to further solidly contribute to the trend of increasing sales and profits.

w Gross profit margin is
expected to improve fromthe next fiscal year onward.

In making forecasts for FY 2024 and FY 2025, we assumed thatdevelopment and subcontracting expenses will settle down, although they
may still increase, so that the gross margin will gradually increase(expecting improvement by 0.2 or 0.5 percentage point YoY, respectively).

33/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)
w SG&A expenses will
increase, but we expect the
SG&A expenses ratio todecline and operating
margin to improve.

Issued: 12/19/2022
On the other hand, we expect the SG&A expenses to increase as theCompany strengthens upfront investments (R&D, personnel, and sales
promotion expenses) to reinforce its business foundation in preparation for
future growth, develop new products, and conduct research on technologies
necessary for that development (virtualization technology, AI, Web API,and FinTech-linked technology).
However, since cost control should be possible to some extent, we assumed
that the SG&A expenses ratio will decline and the operating margin will
improve by around 3 percentage points per year. Consequently, with thesales growth, we expect that profits will increase.

(15) PCA Subscription: Insteadof purchasing or owning
packaged software, monthly or
annual fixed fees are paid for theamount of use. Not cloud-based;
the equipment for operation isprepared and managed in-house.

w In the next fiscal year, we
expect the Company toreturn to a sales and profit
growth trend due to thecompletion of a phase of
upfront investment andcontinued growth ofbusinesses including thecloud.
w We expect sales and profits
to continue to increase in
FY 2025 too.

Factors that May Cause Change
In addition to the growth rate of the cloud, the Company’s financial
performance will most likely be affected by whether it will succeed in thebusiness expansion of PCA Hub which it is currently focusing, as well as
PCA Subscription15, hyper, and Dreamhop’s HR business. Whether there
will be new M&As will also affect the results. Risk factors include higher
costs due to inflation, upward pressure on personnel expenses andsubcontracting costs, and weak performance or bankruptcy ofsmall/medium-sized companies (the Company’s customer base) with theeconomic downturn.

Forecast for the Next Fiscal Year (FY 2024)
We have not changed our forecasts for the next fiscal year: sales of Y14,310
million and operating profit of Y1,870 million. We expect a 10.5% increasein sales and a 33.6% increase in operating profit compared to our forecast
for FY 2023. Sales and profit growth are expected in the next fiscal year
since upfront investments may have come to the end of a phase and thefallback from the event-driven high demand will have ended, while thecloud will continue to grow.
Forecast for the Fiscal Year after the Next (FY 2025)
For the fiscal year after the next or FY 2025, we expect that sales will
increase by 8.5% YoY to Y15,520 million, operating profit will be Y2,550
million, and net profit will be Y1,550 million, with a greater than 30%
growth for both profits. The positive results of the upfront investments are
expected to be seen in sales and profits.

34/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022

8． Analyst’s View
◆ PCA’s Strengths and Challenges
The Company’s SWOT analysis has been updated and the results are listed
in Figure 24 (no change since the previous analysis).
【Figure 24】SWOT Analysis
・ Brand recognition and trust earned over many years (major specialized player in the enterprise system software market for small/medium-sized companies)
・Firm financial standing (debtless management) and stable cash flow; ample cash & deposits exceeding annual sales
・Growth of the subscription business based on continuous payment for service; capable of continuously generating stable revenue (became a cash-cow business)
・ Strong and diversified customer base (240,000 corporate users in total)

Strength

・Taking a lead with the cloud (top-level results, expertise, number of users, and years in service for enterprise system software business targeting small/medium-sized companies)
・High barrier to market entry
・Very experienced call center staff and engineers (support capability)
・Rich product lineup; provides products both as on-premises and by cloud (development capability)
・ Sales capability: sales network with sales offices throughout Japan (13 offices) and 2,000 partnered companies

Weakness・Relatively somewhat low profit margins
・Financial results susceptible to revisions related to accounting and tax laws, end of OS support, etc. (consumption tax, change in the name of the era, Windows 7, etc.)
・Maintenance service subscription rate is improving but could still be improved
・Absence of a major, next-generation, growth-driving product/service
・Domestic-demand oriented; overseas expansion difficult
・Increased demand from lack of human resources and for streamlining operation (for business software in general); work-style reform (work management system)
・Potential to increase users of cloud service; development potential (toward small/medium-sized companies and mid-tier companies)

Opportunity

・New products (hyper, PCA Hub, etc.), new services (transition of on-premises to subscription-based model), and innovations in technology
・Development of HR businesses
・Revisions in regulations related to accounting and tax, etc. (the revised Electronic Books Maintenance Act, invoicing system, etc.)
・Emergence of an alternative as advanced AI technology becomes widely used, delayed product development, defects in products, etc.
・High competition (maturation of on-premises market; other companies catching up with the Company in the cloud business)

Threat・COVID-19 outbreak/prolongation and worsening business performance of Japanese small/medium-sized companies due to the worsening global macroeconomy
・Contract termination risk, etc.
・System troubles and information leakage
・Rise in personnel and development costs(Ref) Prepared by Alpha-Win Research Dep.

w Trust and track record built
over many years, customer
base, expertise intechnology, ample cash &deposits, and firm financialbase are its strengths.
w Also has a competitiveedge and top-level
achievements with thecloud business that it istaking a lead. The cloudmarket has a high growthpotential.
w Rich in cash and debtless
w Development of the next
new products/services isthe challenge.

w Business volatility
increases before and after
events due to event-driven
high demand.

Describing the strengths listed in Figure 24 in more detail, the Company iswell known due to its long years of service in the industry and the trust thatit has earned over those years. It is especially strong in certain areas ofbusiness (such as accounting software for small/medium-sized companies).
Its customers also have high loyalty, as there is little incentive to frequently
change enterprise system software. Additionally, the Company has beendeveloping a subscription-based business model with high continuity andstability by providing maintenance support, cloud versions, and version
upgrades to its customers. It is leading the market with the cloud, which hasa high growth potential, and its competitive edge and top-level
achievements have become its strengths.
Also, its solid financial base with no debt and abundant cash & deposits
exceeding the annual sales are enhancing the stability and reliability ofmanagement.
On the other hand, looking at the weaknesses in more detail, the Company
has been searching for the next, new major products and services and forways to gain market share among mid-tier companies, but has not yet beenable to develop businesses that has high profitability and would enable
enough economies of scale.
As for the opportunity and weakness (or threat), as we have seen in the past,
volatility of financial performance tends to increase due to high demand
before and after events such as the consumption tax revision, work-stylereform, end of Windows support, replacement in response to termination of

35/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022
support for the existing product series as in the previous fiscal year, andpotential tax reforms and changes in the mainstream OS in the future.

w Aiming for non-priceIn the cloud service that it is taking a lead, the Company is aiming for nonprice competition through product strength, service, and support. However,its competition with major companies that have started the business later
and with service providers that provide limited functions at lower priceranges will be the key points.

competition. The situationof competition with its
competitors will be a key
point.

◆ Shareholder Return and Shareholder Benefit Program
Dividend Policy
The Company’s basic policy is to continue the stable payment of dividend
while improving the ratio of net profit to shareholders’ equity (ROE) undereffective business management. In returning profit to its shareholders, its
policy is to determine the level of dividend to be paid based on acomprehensive analysis of elements such as its financial results anddividend payout ratio.

w Stable payment ofdividend is its basic
policy.

Dividend History
Regarding dividend, ever since the first public offering of the Company’s
stock, ordinary dividend has never been decreased and has been graduallyraised over the long term with several years of no change in between (Figure25). It has also been generally strengthening the return of profit toshareholders.

w No decrease in ordinary
dividend in the past.

【Figure 25】Change in Dividend and Dividend Payout Ratio (reflecting stock split)
Dividend (right axis)
Dividend Payout Ratio (left axis)

（％）

300.0

Commemorative Dividend (right axis)

(Y)

30.0

281.1

24.0

250.0
200.0

18.0
13.3

50.0
0.0

19.0

6.7

132.0

18.0

3.3

100.0
10.0

10.0

30.9

47.8

FY 2009

FY 2010

10.3

10.3

10.3

47.2
FY 2011

FY 2012FY 2013

20.0

11.0

116.9

150.0

25.0

16.0

10.3

10.3

10.3

46.5

ＮＡ

ＮＡ

FY 2014

FY 2015

FY 2016

10.3

10.3
48.2

FY 2017

FY 2018

10.3

13.0

11.3

11.3

19.8

13.6

20.3

FY 2020

FY 2021

FY 2022

10.0

40.0

31.9

FY 2023(E)

FY 2024
(E)

24.5

23.3
FY 2019

15.0

FY 2025
(E)

5.0
0.0

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary. The above graph has been retroactively adjusted for thethree-for-one stock split on October 1, 2021. Estimates/forecasts (E) were made by Alpha-Win.

w 目標配当性向は 33％、純資産配当率は 2.5％が目標。実績と乖離が大きく、中長期的には増配余地がある。

Excluding commemorative dividend, the ordinary dividend had been kept
at 10.3 yen/share per year since FY 2011 (31 yen before the stock split:
dividend before the retroactive adjustment for the stock split is underlined).
Then, in FY 2020, it raised dividend by 1 yen (3 yen) to 11.3 yen (34 yen)
and also paid a commemorative dividend of 6.7 yen/share (20 yen) for its
40th anniversary.

36/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)w This fiscal year, it will
maintain the ordinary
dividend of 13 yen per
share (post-stock-split), thevalue after the essential
rise in dividend.

w The medium-term targets

are a dividend payout ratioof 30% (previously 33%)
and dividend on equity(DOE) of 2.5% or more.
This FY, dividend payout
ratio is expected to exceed
the target, but the DOE is
expected to fall short. Overthe medium to long term,
dividend hikes are possible
as profit grows.

w The actual annual net yield
including the shareholder
benefit program is about
1.5% (at maximum) (basedon the Company’s forecast)Issued: 12/19/2022
In FY 2021, there was no more commemorative dividend, while theordinary dividend was kept at 11.3 yen (34 yen). In FY 2022, the ordinary
dividend was increased from 11.3 yen (34 yen) to 13.0 yen (39 yen), and acommemorative dividend of 11 yen was added to a total of 24 yen (72 yen).

Dividend Forecast
Although there will be no commemorative dividend this fiscal year, it plans
to maintain the ordinary dividend at the increased value of 13 yen (39 yen
before being adjusted for the stock split).
The target dividend payout ratio used to be 33%, but the actual ratio was
13.6% in FY 2021 and 20.3% in FY 2022, both below the target. However,in FY 2023 (based on the Company’s forecast), the ordinary dividend of 13
yen is planned to be maintained, but the dividend payout ratio is expected
to become 40.7% with the decline in EPS, exceeding the target of 33%.
Also, based on a stock price of Y1,285 (closing price on December 16, 2022,with dividend assumed to be 13 yen), this fiscal year’s dividend yield isestimated to be about 1.0%.
Dividend on equity (DOE), which is one of the Company’s KPIs (keyperformance indicators), was 2.9% in FY 2022, exceeding the target of
2.5%. This fiscal year, we estimate that the DOE will be around 1.5%,
falling short of the target again. The dividend payout ratio and DOE tend tolargely fluctuate, though, in response to large changes in profit that may becaused depending on whether there is event-driven high demand.
Also, even if the amount of dividend remains constant, the dividend payout
ratio can fluctuate with changes in business performance. Therefore, wehave revised our dividend forecast based on the assumption that the DOE,
which is a stable standard, will be around 2%. In the order of our previous
forecast to our current forecast, we have revised the ordinary dividend pershare for the current fiscal year from 13 yen (same as the previous fiscal
year) to 16 yen (+3 yen YoY), and for the next fiscal year from 14 yen (+1
yen YoY) to 18 yen (+2 yen YoY). Similarly, for the fiscal year after the
next, we have revised the dividend from 15 yen (+1 yen YoY) to 19 yen(+1 yen YoY). Based on our dividend forecasts, the dividend yield for eachyear would be 1.2%, 1.4%, and 1.5%, respectively.
Dividend Yield Including the Shareholder Benefit Program
The Company has a shareholder benefit program and gives out Quo Cards
to shareholders based on the number of shares held at the end of March of
every year. For example, shareholders with equal to or greater than 300
shares and less than 900 shares are granted Y2,000 worth of Quo Card.
Based on a stock price of Y1,285, the actual annual net yield for ashareholder owning 300 shares is expected to be about 1.5% (max)according to the Company’s forecast, including the ordinary dividend of
Y13 and the shareholder benefit, and 1.8% (max) according to our forecast(Figure 26 on page 38).
Based on the same conditions, the actual annual net yield is about 2.3% for
OBC (4733: Obic Business Consultants) (including the shareholder benefit
program) and about 2.7% for MJS (9928: Miroku Jyoho Service) (onlydividend yield since it has no shareholder benefit program).

純
w 目標配当性向は 33％、
37/41
This
Alpha-Win Company Research
Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in this
資産配当率は2.5％が目Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,標。実績と乖離が大きorfit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
く、中長期的には増配余
propertyof this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.
地がある。

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022【Figure 26】Shareholder Benefit Program and Actual Net Yield
Number of Shares Owned(greater than or equal to)
300

900

Shareholder Benefit(Quo Card: Y)
2,000

13

1.53

900

1500

3,000

13

1.27

4,000

13

1.22

(less than)

1,500

Dividend: Y

Net Yield (maximum): %Net yield = (Dividend + Benefit value) / (Stock price), calculated for the minimal number of shares owned in each range
Stock price: Y1,285 (closing price on 12/16/2022)(Ref) Prepared by Alpha-Win Research Dept.

Stock Split
A 1.3-for-1 stock split was conducted in May 2000. Then, for the first timein approximately ten years, it conducted another stock slit (three-for-one
stock split) on October 1, 2021.

◆ Stock Price and Factors that May Affect Stock Price
Performance
The Company’s stock price and relative stock price compared to the
TOPIX for the past approximately six and a half years are described in thesummary section (Figure C on page 4). Its stock price has risen by approx.
3.4x over this period, significantly outperforming the TOPIX which only
increased by 1.5x meanwhile.

w With solid performance,stock price has increased
largely and has beensignificantly
outperforming the TOPIX
for the past approximately
six and a half years.

However, after reaching a recent high in September 2021 (closing priceafter adjustment for the stock split: 2,083.33 yen), the share price became
weak both in absolute and relative value in reaction to this and also in
response to the forecast of a large drop in profit during this fiscal year.

w Weak stock price since
September 2021

【Figure 27】Comparison of Stock Performance with Competitors(Note: the stock price as of the end of June 2016 was set to zero upon creating thegraph. Reflects prices up through the closing price on December 16, 2022)

400%

PCA (9629)

OBC (4733)

MJS (9928)

350%
300%
250%
200%
150%
100%
50%

Oct 2022

Dec 2022

Jun 2022

Aug 2022

Apr 2022

Feb 2022

Oct 2021

Dec 2021

Jun 2021

Aug 2021

Apr 2021

Feb 2021

Oct 2020

Dec 2020

Jun 2020

Aug 2020

Apr 2020

Feb 2020

Oct 2019

Dec 2019

Jun 2019

Aug 2019

Apr 2019

Feb 2019

Oct 2018

Dec 2018

Jun 2018

Aug 2018

Apr 2018

Feb 2018

Oct 2017

Dec 2017

Jun 2017

Aug 2017

Apr 2017

Feb 2017

Oct 2016

Dec 2016

Jun 2016

Aug 2016

0%
-50％
-50%

(Ref) Prepared by Alpha-Win Research Dept.

38/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

w 株主優待制度を、一部拡充。優待を含めた実質年間利回りは、約 3％

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022
The Company’s stock price has been outperforming indices such as the
TOPIX and the TSE Mothers since the beginning of the year. Moreover,after the announcement of this fiscal year’s first-half results (during theapprox. two months since October 24), the Company’s stock price has been
outperforming the major indices as well as its two competitors (4733 ObicBusiness Consultants or OBC and 9928 Miroku Jyoho Service or MJS),
presumably since the stock price has been favorably affected by theannouncement that there was large progress with profits in the first half
compared to the Company’s full-year plan (Figure 27 on page 38 and
Figure 28).

w In the most recent twomonths after theannouncement of the firsthalf results, stock price has
been outperforming the
TOPIX as well as its
competitors.

In the approximately six and a half years since June 2016, the Company’s
performance has been the highest compared to its two competitors (Figure
26 on page 38).
【Figure 28】Comparison of Stock Performance and Valuation (comparison with major indices)(Note: stock price through the closing price on December 16, 2022. The Company’s first-half results were announced on October 24, 2022)
Stock priceor index

This fiscal
year'sforecasted P/E

Actual P/B(at end of quarter)

Dividend yield(simple average)

PCA (PRM 9629)
Average of all TSE Prime stocks: PRM

1,285
1,003.51

40.22
13.42

1.51
1.15

1.01
2.38

-

33.3
2.7

27.2
3.3

Average of all TSE Standard stocks: STD
Average of all TSE Growth stocks: GRT

1,010.60
983.14

14.21
85.05

0.91
4.20

2.22
0.32

-

4.7
11.9

2.9
6.4

TOPIX

1,950.21

-2.11

2.7

3.3

TSE Mothers
Nikkei Stock Average774.8327,527.12-23.74
-4.4

11.6
2.5

6.7
2.0

Closing price on Dec. 16, 2022

12.58

1.14

2.31

Return since thebeginning of the
year
6.73

Return since theend of April 2022

Return sinceOct. 24, 2022

(Ref) Prepared by Alpha-Win Research Dept.

w Valuation is expensive

compared to the averagevaluation of TSE Prime
based on this fiscal year’svalues.

Valuation
Based on the Company’s current level of stock price, its valuation seems
overvalued in terms of the main valuation measures compared to theaverage of all stocks of the TSE Prime Market (Figure 28).
Compared to the TSE Prime’s forecasted average P/E of 13.42, theCompany’s P/E based on its forecasted values for this fiscal year is 40.22.
Similarly, compared to TSE’s actual P/B of 1.15 and dividend yield (simple
average) of 2.38%, the Company’s is 1.51 and 1.05%, respectively.

w P/E expected to sharply
decrease with the increasein profit.

Based on our forecast of profit, the Company’s P/E is 32.1 for the current
fiscal year, 22.7 in the next fiscal year, and 16.6 in the fiscal year after thenext.

w Valuation does not seem

underpriced compared toits competitors (OBC and
MJS).

w The two cloud-accounting
competitors have extremely
high valuations.

When its valuation is compared with its two competitors (OBC and MJS),
the Company’s valuation is undervalued in terms of P/B, but overvalued interms of P/E, dividend yield, and EV/EBITDA (Figure 29 on page 40).
Money Forward (TM: 3994) and freee (TM: 4478) described previously
are also the Company’s competitors among listed companies in areas suchas cloud accounting software. However, they are not reasonable targets forvaluation comparison since they have been posting net losses and paying
no dividend. Also, although both companies’ stock prices have fallen
sharply, their valuations are still extremely expensive in terms of thecomparable valuation measures of P/S (market capitalization / sales) andP/B (similar for the comparison with the private company Yayoi).

39/41This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)

Issued: 12/19/2022【Figure 29】Comparison of Valuation with Competitors
Company Name
Code
MarketStock price (at 12/16/2022 closing)Market cap (million yen)
Market where listed, stock price,
P/E (price-to-earnings ratio)
and valuations
P/B (price-to-book ratio)
Dividend yield (%)
EV/EBITDA
P/S (price-to-sales ratio)
Sales (million yen)Company forecasts for this fiscal
Gross margin (%)
year(Forecasts for fiscal year ending
Operating profit (million yen)March 2023 for PCA, OBC, andOperatingmargin (%)
MJS; forecasts for fiscal year ending
Nov. 2022 for MF; forecasts for fiscal YoY change in EPS (company forecast)
year ending June 2023 for FR)(%)
Last fiscal year's results
Actual DOE (%)
Past ten years' sales growth rate (%)
Past growth rates
Past ten years' operating profit growthrate (%)
Equity ratio (%)
Sales (million yen)First-half results(First half of fiscal year ending
Sales growth rate (%) (YoY)
March 2023 for PCA, OBJ, andOperating profit (million yen)
MJS; first half of fiscal year ending
Operating profit growth rate (%)
Nov. 2022 for MF; first half of fiscal
year ending June 2023 for FR)(YoY)Operating margin (%)

PCA(consolidated)

Obic Business Consultants(OBC: nonconsolidated)

Miroku Jyoho Service(MJS: consolidated)

Money Forward(MF: consolidated)

9629
TSE Prime

4733
TSE Prime

9928
TSE Prime3994
TSE Prime

Yayoi(at the time ofacquisition)

freee(FR: consolidated)

1,285
29,684
40.2
1.5
1.0
10.5
2.3
12,927
60.7
1,100
8.5

4,295
323,860
26.3
2.3
1.6
11.2
8.8
37,00083.5
16,91045.7

1,505
52,383
12.5
2.0
2.7
5.6
1.3
40,800Not disclosed
5,800
14.2

4,395
236,511
6.8
Negative
11.2
21,197
Not disclosed-8,554-40.4

4478
TSE Growth
3,010
171,656
5.2
Negative
5.3
18,821
Not disclosed-7,124
-37.9

-

-73.0

4.1

-4.0

-

-

-

2.9
96.7

4.0
103.0

6.0
86.8

-

-

-

467.3

109.3

136.7

-

-

-

59.6
6,163
-6.7
847

80.6
16,224
-0.3
6,787

51.7
19,881
11.8
3,102

56.4
9,841
31.9
-

86.4
6,856
48.5
-

-

-51.7

-5.6

31.3

-

-

-

13.7

41.8

15.6

-

-

-

Private company
250,000
74.4
28.7
11.3
21,193-(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary(Note) Market cap = total outstanding shares x market stock price [at 12/16/2022 closing]
EV/EBITDA = (market cap + interest-bearing debt - cash & deposits) / (O.P. + depreciation + intangible fixed asset amortization, etc.)*Interest-bearing debt and cash & deposits are based on the actual quarterly values of the most recent period. Operating profit (O.P.) is based on thisfiscal year’s company forecasts. Depreciation and intangible fixed asset amortization are full-year values calculated from actual quarterly values ofthe most recent period.
The companies’ forecasted EPS for FY 2023 was used in all P/E calculations. BPS values used in P/B calculations are actual quarterly results of the mostrecent period. Dividend is based on the companies’ forecasts.
P/S = market cap / sales [the companies' forecasts]
For values that were announced as ranges, the average was used. Growth rate over the past ten years is the comparison between the full-year results for themost recent fiscal year and for ten fiscal years ago.
Yayoi (private company): Values are all for the fiscal year ended September 2021. Market capitalization is the estimated acquisition price by KKR as ofDecember 2021.

w Domestic-demand-oriented
growth stock with highgrowth potential. The key
themes are the cloud,subscription, DX, responseto the Electronic Books
Maintenance Act and the
new invoicing system,work-style reform, andmental health.

w Return to sales and profit
growth expected in thenext fiscal year onwards as
there will no longer be a
fallback from the eventdriven high demand.

Outlook
While the COVID-19 regulations are becoming relaxed in Japan and othermajor countries, there are still uncertainties concerning the economic
situation due to factors such as the war in Ukraine, inflation, and themonetary tightening.
However, the Company will most likely continue to be recognized as adomestic-demand-oriented growth stock with a strong subscription-based
business (shifting packaged enterprise system software to thecloud/subscription business) which can benefit from the growth potentialof this business as well as its advantageous position in terms of thegovernment’s promotion of the work-style reform, digitalization, and the
expansion of the metal-health-related market.
From the next fiscal year onwards, as the economy normalizes, the new
businesses will most likely gradually contribute to its financial
performance, and the growth of the cloud and the work management
system will be the growth drivers. The fallback from the event-driven highdemand for the products will also most likely have ended. In addition, theElectronic Books Maintenance Act and the new invoicing system maycreate new demand for PCA Hub and replacement demand for the existing
software, although they may not be as large as an impact to call it an eventdriven high demand. Due to these changes, we believe that the Company
will return to a sales and profit growth trend.

40/41This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research Report
PCA (9629 TSE Prime)
w Considering the growthpotential over the medium
term, we believe that there
may be an upside to thestock price.

Issued: 12/19/2022
The stock price seems to already mostly reflect this fiscal year’s large profit
drop. On the other hand, financial performance may be revised upward thisfiscal year. Based on the forecasted profit growth trend starting next fiscal
year, there seems to be an upside to the stock price over the medium term.
Going forward, the following will be the key points that may impact thestock price:

w Key points are the cloud’s
growth rate, themonetization of the new
businesses/services(especially PCA Hub),medium-term profit
growth rate, changes in tax
systems and otherregulations, return ofprofit to shareholders, andthe ways it will utilize its
cash.

1) Performance of the cloud business (changes in PCA Cloud’s number ofcorporate users and sales growth rate)2) Progress with the development of new products, services, and businesses,
their contribution to profit, and their market competition (the financial
performance of the acquired company Dreamhop as well as the sales
situation of PCA Hub that it is currently especially focusing on, theprogress with the shift of the on-premises to the subscription-based
business model or PCA Subscription, and sales situation of hyper)
3) Progress with the current medium-term management plan and changes
in the medium-term profit growth rate and profitability (gross margin andoperating margin)5) Measures to return profit to shareholders such as dividend hikes, sharebuybacks, and stock splits, as well as the utilization of treasury shares
including their cancellation
6) Progress with the M&A strategy
7) Introduction of business/profit management system and their effects
8) New tax systems and changes in regulations
9) Effective use of its ample cash

41/41
This Alpha-Win Company Research Report (hereinafter “this "Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate,or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting fromthe use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.