Alpha-Win Company Research Report
PCA(9629 TSE Prime)● SummaryIssued: 6/23/2023

Alpha-Win Capital Research Department
https://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.

Last Fiscal Year’s Financial Results and This Fiscal Year’s Forecast
・The full-year financial results for the previous fiscal year (fiscal year ended March 31, 2023) were as follows: salesof Y12,981 million (-3.0% YoY), operating profit of Y1,288 million (-51.5% YoY), and profit attributable to ownersof the parent of Y883 million (-62.7% YoY). The Company had made upward revisions to its forecasts during the
fiscal year, compared to which sales were mostly as expected while the operating and recurring profits were short of
the forecasts by about Y100 million (about 7%). On the other hand, the net profit exceeded the forecast by Y75
million (about 9%); the results were mixed. Dividend was 17 yen as planned.
・Alpha-Win Research Dept. had forecasted the same level of results as the Company’ revised forecasts.
・Due to the end of support for the PCA X series, product replacement demand occurred in the fiscal year before theprevious (FY2022). In the previous fiscal year, the products’ sales decreased significantly (-61.1%) in reaction to thisprevious high demand. However, this was compensated by the growth of the other operating revenue and the cloudservice’s sales, resulting in only a slight decrease in overall sales. The gross margin decreased because the productmix worsened with the sales decline of the products, which presumably have a high profit margin, and because thecosts such as labor and subcontracting costs increased. In addition, the SG&A expenses rose because of increased
upfront investments (such as development costs) and higher costs due to inflation, causing profit to become halved.
・Regarding each quarter, both sales and profits decreased YoY from Q1 to Q3, but profit was maintained. However,in Q4, although sales turned to an increase, the Company posted an operating loss and a recurring loss. These weremainly due to the strategic increase in costs, such as those for investment in development, which seemed to havecaused the divergence from Alpha-Win’s profit forecast.
・During the past period of reactionary decline following an event-driven high demand (FY2015), sales and profits
fell significantly and a net loss was posted. Last fiscal year, though, thanks to the strategic shift of the businessportfolio to the subscription-based businesses (maintenance + cloud service) which are highly maintainable andstable, the upfront investment costs were absorbed and the Company was able to post an operating profit of morethan Y1.2 billion albeit with a significant profit decline.
・ The Company announced its financial forecast for the current fiscal year (FY2024): sales of Y14,700 million,
operating profit of Y1,445 million, and profit attributable to owners of the parent of Y925 million. This fiscal year,
it plans to revise the prices of the current products and services in July 2023. It is also expecting sales to increase by
13.2% due to the sales of the PCA Hub series and the continued growth of the cloud services. On the other hand,
although the Company’s business model is characterized by a high marginal profit ratio, it expects the profit growthrate to be equal to or slightly lower than the sales growth rate due to inflation and upfront investment costs such ascontinued investment in development. Dividend per share is planned to be 17 yen, the same amount as the previous
fiscal year.
・As with the previous fiscal year, the forecast for the first half has not been disclosed.

Alpha-Win Research Department’s Forecast of Financial Results・Based on the Company’s financial forecast for this fiscal year and interview, we reviewed our forecasts for thecurrent and the next fiscal year. We also prepared forecasts for the next three years, newly adding a forecast for the
fiscal year after the next or FY2026. For the current and the next fiscal year, we revised our sales forecasts slightly
upward, while the profit forecasts were revised downward.
1/43
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: 6/23/2023

・The main reasons are that the upfront investment costs have increased more than expected due to greater investmentin the development of products and service, general expenses such as personnel expense and subcontracting costs
are expected to increase due to inflation, and there have been delays in the contribution of the new businesses such
as Dreamhop Co., Ltd., to profit.
・We revised our forecasts for this fiscal year (in the order of previous ⇒ current forecast) as follows: while sales wererevised upward from 14,310 ⇒ 14,700 million yen (compared to the Company’s forecast: the same amount),
operating profit was revised down from 1,870 ⇒ 1,450 million yen (similarly, +5 million yen), net profit was revised
down from 1,130 ⇒ 925 million yen (the same amount), and dividend was also revised down from 18.0 ⇒ 17.0 yen(the same amount), each revised down to the same level as the Company’s forecasts.
・In the financial forecasts for the current fiscal year, the likelihood is high that the upward price revision during the
fiscal year will have an effect, while the sales trend of the PCA Hub series and cost control will be the factors that
may cause change. We believe if there is no longer a reactionary decline in sales and profit caused by an event-driven
high demand and if the Company does not strategically increase costs like in the previous fiscal year’s Q4, then its
profit plan may be achieved.
・ Assuming that economic activities will gradually return to normal as the global economy and the COVID-19
outbreak settle down, we predict that the Company will return to sales, profit, and dividend growth trends over the
medium term as its cloud business grows, the PCA Hub series contribute to its business performance, and the upfront
investments peak out in the fiscal year after the next or later. We have not changed our prediction that the annual
profit growth rate over the medium to long term (on a normalized basis excluding any 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 for accounting and finance software targeting small/medium-sized companies. It is especially taking alead with cloud-based enterprise system software in those fields and is the top player for them in the market.
・Its strength is its concentration of resources in its field of expertise as a specialist, enabling the development of
products and services that meet various customer needs ahead of its competitors, including needs related to changes
in tax and other regulations. It also has a stable customer base and can provide high-quality products and services atreasonable prices.
Business Strategy
・The Company has announced the medium-term management plan for the three years that started last fiscal year.
Numerical targets for the final year or FY2025 (next fiscal year) are as follows: sales of Y15 billion or more (ofwhich, subscription-based sales are Y9.5 billion or more), consolidated operating profit of Y2.5 billion or more(consolidated profit margin of 16% or more), ROE of 10% or more, DOE of 2.5%, and dividend payout ratio of 30%.
Excluding sales, all figures have already been mostly achieved in the past.
・Sales and dividend payout ratio are well within the range of achievement, but operating profit, ROE, and DOE, whichwere initially thought to be conservative targets, have deviated from the plans for this fiscal year.
・The PCA Group’s growth strategy is to provide total solution services centered on software. It is executing 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). It plans to proactively work on the SDGs
while expanding its subscription business, strengthening its product development capacity, and responding todigitalization needs.
・On the other hand, its biggest challenges are to effectively utilize its abundant cash and deposits (which exceed its
annual sales) for future growth and to put onto track and monetize the new businesses that it has started (PCA Hub,
PCA Subscription, hyper, and healthcare business).
Stock Characteristics and Price
・The Company’s stock is a defensive, domestic-demand-oriented, and small-cap growth stock that is anticipated toexperience growth in the subscription businesses and is positively impacted by the work-style reform and tax reforms.
However, the volatility of business performance and stock price tends to increase before and after periods of eventdriven high demand.

2/43
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: 6/23/2023

・Over the past seven years, the Company has outperformed the TOPIX and its competitors. On the contrary, it has
been underperforming since the beginning of this year, but has been outperforming again after the announcement of
the financial forecasts for this fiscal year.
・The valuation of the Company’s stock based on this fiscal year’s forecasts is somewhat expensive compared to theaverage of all stocks listed on the Tokyo Stock Exchange’s Prime Market.
・However, its business is mainly subscription-based and is therefore stable and maintainable, and the subscription
business has a high growth potential. The Company is therefore expected to return to a growth trend for sales andprofit starting this fiscal year. Since EPS growth and subsequent dividend hikes are expected, we believe that there
is an upside to the stock price over the medium to long term. For the time being, the stock price will likely be affectedby the quarterly trends in business performance, as well as whether the new businesses (especially PCA Hub) will
succeed, the growth rate of the cloud business, and whether its financial performance will be impacted by changes inthe tax system and accounting system (especially the new invoicing system and the Electronic Books Preservation
Act).

Return of Profit to Shareholders
・The Company has been stably paying dividend and has bought back its shares several times. The dividend payout
ratio was 38.5% in FY2023 (last fiscal year’s result) and expected to exceed the target (30%) again this fiscal year
at 36.8% (Alpha-Win’s forecast). Meanwhile, we estimate that this fiscal year’s DOE will be 1.9%, falling below
the target of 2.5%.
・Since business performance is expected to grow in the next fiscal year onwards too, we anticipate that the Company
may further enhance its return of profit to shareholders, such as dividend hikes and share buybacks.

【 9629 PCA

Sector: Information & Communication 】 Figure A

FY
2020
2021
2022
2022
2023
2024
2024
2025
2025
2026

Old Standard
Old Standard
Old Standard
New Standard
New Standard
CE New Standard
E New Standard
CE Medium-term Plan, New Standard
E New Standard
E 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 ）

14,266
13,30815,142
13,382
12,981
14,70014,70015,00015,52016,500

24.7
-6.7
13.8
0.6
-3.0
13.2
13.2
2.0
5.6
6.3

2,781
2,314
2,516
2,655
1,288
1,445
1,450
2,500
1,550
1,650

122.8
-16.8
8.7
14.7
-51.5
12.2
12.6
73.0
6.9
6.5

Dividend

2,808
2,340
2,542
2,697
1,326
1,478
1,480

119.9
-16.7
8.6
15.2
-50.8
11.4
11.6

1,816
1,668

100.4
-8.1

90.97
83.50

675.81
791.64

18.00
11.33

2,367
883
925
925

41.9
-62.7
4.8
4.8

118.36
44.16
46.27
46.25

847.14870.38899.60

24.00
17.00
17.00
17.00

1,570
1,670

6.1
6.4

980
1,040

5.9
6.1

49.00
52.00

931.60965.60

18.00
19.00

(Note) CE: the Company’s estimate/forecast. E: Alpha-Win Research Dept.’s estimate/forecast.
Past years were retroactively revised for the stock split (3-for-1) conducted on October 1, 2021 (for EPS, BPS, and dividend)
The Accounting Standard for Revenue Recognition (ASBJ Statement No. 29), etc., have been applied starting in FY2022. “OldStandard” is the previous revenue-recognition standard. “New Standard” is the new revenue-recognition standard.

【 Stock Price and Valuation Indicators: 9629 PCA 】 Figure B
Item

6/23/2023

Item

P/E

P/B

Dividend Yield

Dividend Payout Ratio

Stock Price (Y)1,367Last FY's Results

31.0

1.6

1.2%

38.5%

Shares Outstanding (thou.)

22,000This FY's Forecast

29.6

1.5

1.2%

36.8%

Market Capitalization (million yen)

30,074

Next FY's Forecast

27.9

1.5

1.3%

36.7%

56.9%

Last FY’s ROE

5.1%

Dilutive Shares (thou.)0

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

3/43This 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: 6/23/2023【Stock Chart (end-of-week prices) : 9629 PCA】 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

1.50
1.00

08
/1
6
01
/1
7
06
/1
7
11
/1
7
04
/1
8
09
/1
8
02
/1
9
07
/1
9
12
/1
9
05
/2
0
10
/2
0
03
/2
1
08
/2
1
01
/2
2
06
/2
2
11
/2
2
04
/2
3
(M
M
/Y
Y
)

300

【Performance】
PeriodReturn vs. TOPIX
1 month13.2%
6.9%
3 months
5.8%-7.2%
6 months
1.9%-17.9%
12 months
17.7%
-3.3%
(Note) Reflects stock price and index values
through the closing price on 6/16/2023. The
return for the 1-month period is thecomparison between the closing price on thelast day of May and the closing price on July
16. Similar for the other periods. Preparedby Alpha-Win Research Dept.

(Note) From the fourth week of August 2016 to the fourth week of June 2023 (closing price on 6/23)(Note) In the text and figures of this Report, the values for the same item may not match completely with each other or with theCompany’s announced values due to rounding, rounding during the calculation process, format of display, and other factors.

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

Disclaimer
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 (https://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, or translated 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.
F2023-06-30-0000

4/43This 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: 6/23/2023

Contents
1．Company Overview .......................................................................................................................... P6
Major Specialized Player in the Enterprise System Software Industry ............................................. P6
Business Philosophy .......................................................................................................................... P9
Renewed Tagline and Product Brand ................................................................................................ P9
2．Business Description and Business Model ................................................................................... P10
Enterprise System Software Crucial for Efficient Business Operations ......................................... P10
Highly Maintainable Business Model with High Marginal Profit Ratio ......................................... P10
Expansion of the Highly Stable and Profitable Subscription Businesses ........................................ P11
Cloud Business as the Growth Driver ............................................................................................. P12
PCA Hub Series ............................................................................................................................... P13
3．Shareholder Composition .............................................................................................................. P15
Change in Composition by Type of Shareholder ............................................................................ P15
Major Shareholder Composition ..................................................................................................... P15
4．ESG and SDGs ............................................................................................................................... P18
Environment, Society, and Governance .......................................................................................... P18
5．History of Growth .......................................................................................................................... P19
Company History ............................................................................................................................. P19
Past Transition in Financial Results ................................................................................................ P19
6．Business Environment ................................................................................................................... P22
Trends of the Software Market ........................................................................................................ P22
Comparison with Competitors ......................................................................................................... P23
7．Last Fiscal Year’s Results and This Fiscal Year’s Forecast ...................................................... P26
Results for FY2023 (last fiscal year) ................................................................................................. P26
PCA’s Financial Forecast for FY2024 (this fiscal year) ................................................................... P30
Alpha-Win Research Dept.’s Financial Forecast for FY2024 (this fiscal year) ................................ P32
8．Growth Strategy ............................................................................................................................. P34
Medium- to Long-Term Vision and Policy ..................................................................................... P34
Management Indicators Set as Goals ............................................................................................... P35
Alpha-Win Research Dept.’s Forecast of Medium-Term Financial Results ................................... P35
9．Analyst’s View ................................................................................................................................ P38
PCA’s Strengths and Challenges ..................................................................................................... P38
Shareholder Return and Shareholder Benefit Program ................................................................... P39
Stock Price and Factors that May Affect Stock Price ..................................................................... P41
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., FY2024
ends in March 2024.
5/43This 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: 6/23/2023

1. Company Overview

w Major specialized player
in the industry with 43
years of history,
developing and providing
packaged enterprisesystem software forsmall/medium-sized
Japanese companies◆ Major Specialized Player in the Enterprise System
Software Industry
PCA CORPORATION (hereinafter, the “Company”) is an independent,
mid-tier company in the software industry. Founded in 1980, it has 43 yearsof history. It is a specialist in developing and providing packaged software(software prepared for use in certain operations) for enterprise systems1,
such as those for accounting and tax. It is a major, specialized player forsuch software targeting small/medium-sized companies.

(1) Enterprise system: Part of acompany’s information systemthat deals with matters directly
related to business, such as
financial accounting, production
control, sales management,
inventory management,purchases, HR, and payroll. A
general term for back-officeapplications. Also called themission-critical system, it serves
as the important 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 total sales.
With regards to the size of the corporate customers, the Company isespecially strong in business toward small/medium-sized and mid-tiercompanies with 20 to 300 employees. 80% of the Company’s sales are
made through distributors (the remaining 20% are direct sales). Its
customers are diversified. By monetary value, many of its major customers
are large corporations. In past years, its largest customer has been RicohCo., Ltd. (listed on the Tokyo Stock Exchange’s Prime Market; securities
code 7752), which accounts for about 25% of total sales. Its accounting
software has been implemented by over 8,000 public benefit corporations
in total; it is the top player in the market for these customers.

w The PCA Group iscomposed of the Company
and 3 subsidiaries.
Acquired Dreamhop but
sold Keepdata.

As of the end of May 2023, the Company’s group is composed of a total offour companies: the Company and three consolidated subsidiaries (Figure
1).
1) Xronos Inc. (development/sales of work management system2; theCompany founded this subsidiary in 2001 with an 80% stake)2) KEC Corporation (implementation support for PCA’s products/services,
sales of business software, etc.; wholly owned and founded in 1998 by theCompany)3) Dreamhop Co., Ltd. (mental-health-related business; acquired in October
2020; wholly owned)(2) Work management system:
Also called the attendance
management system, it
manages/utilizes various data on
working hours. Can
automatically aggregate datasuch as working hours andprepare data to link with payroll
software. Provided as an onpremises or cloud-based system.

【Figure 1】Overview of the Three Consolidated Subsidiaries (Words in red indicate the main updates since the previous report)
Overview of Consolidated Subsidiaries
Company Name
Main Office Location

Business Description

CustomerDreamhop 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 2 cities of Osaka and Yokohama

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 stress check tests andfeedback for early detection of persons with mental health problems, and providing
services for preventing leave of absence and job separation), occupational health physician
Sales of packaged business software such as PCA Accounting and PCA Salary,
Work management (attendance management) systems, in-house development of time clocks,
services (consultation with occupational health physicians; the necessary amount of time
maintenance of network systems, software installation support, instructor support forand their sales and maintenance services
can be chosen individually), harassment prevention (law compliance, liability insurance,
implementation, and various user support
and training), and health management (solutions such as revitalizing the organization andimproving productivity)
1,500 companies; 10,000 offices; more than 1,000,000 users
PCA Corporation; Ministry of Health, Labour and Welfare; Ministry of the Environment; Number of users of Xronos Performance (million users): 1.7 ⇒ 1.9 ⇒ 2.5
Ministry of Land, Infrastructure, Transport and Tourism; Tokyo Metropolitan
Number of companies using Xronos Performance: 9,385 (6/7/2023)
Government; Kanagawa Prefecture; Saitama Prefecture; Chiba Prefecture; City of
Number of users of X'sion: 431,78 4 ⇒ 515,412 ⇒ 682,465 (6/7/2023)
Yokohama; Osaka City; City of Sapporo; various other government organizations and Number of companies using X'sion: 4,406 (6/7/2023)
companies of the private sector. Used by companies and organizations of a scale of 10(As of Nov. 15, 20 21 ⇒ May 9, 2022 ⇒ June 7, 2023; info on its website)
100,000 people.
May 2011 (business acquired)

More than 20,000 companies (in Japan)

Founded

October 2020 (date acquired; founded in June 2005)

Capital (million yen)

96.5 (capital increased from 56.5 million yen)

60

10

PCA's Stake

100%

80%

April 1988
100%

Number of Employees(as of the end of Mar. 2023)

16

127

45

Sales (for the most recent period)

Not disclosed

Y2,528 million (FY ended March 2023; information on its website; +15% YoY sales growth)

Not dislocsed

Management Policy

Same as PCA

Formulates its own medium-term plan: working on "investments for future growth" and"steady performance growth"Same as PCA

Category of Consolidated Sales

Other operating revenue

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

Mostly other operating revenue, plus products, merchandise, maintenance, and cloudWebsite URL

https://www.dreamhop.com/

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

https://www.kec-sp.com/page1

Trends in Business Performance andRecent Situation

Strengthening projects for the private sector through collaboration with PCA; started
providing group analysis and consulting services for stress checks as well; expanding
business into areas with added value. However, it still seems to be posting a net loss due toupfront investments.

Intense competition, but since it is a growing market, there is potential for development inareas such as construction. Solid business performance among the consolidated subsidiaries.
Profitability seems high. Working on shifting to the cloud, strengthening related services,
and acquiring new customers.

Business performance tends to be basically linked with the performance of PCA. Dueto the COVID-19 crisis, its business performance had been somewhat stagnant, but
now seems to be recovering.

(Ref) Prepared by Alpha-Win Research Dept. based on each company’s website and securities report and interview with the Company. Eachcompany’s performance trends include estimates by Alpha-Win.

6/43
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: 6/23/2023
The Company acquired Keepdata Ltd. in March 2019 as a consolidated
subsidiary, aiming to create a foothold for the data utilization business.
However, linking systems with the Company and creating synergy in sales
had turned out to be difficult, and Keepdata had been continuously postinga net loss and an excess of debt. Therefore, in December 2020, theCompany sold all shares of Keepdata to a third party.
The ratio of consolidated sales to parent company’s sales has stably
remained around 1.1-1.2, indicating that the parent company’s financial
results have a greater weight (Figure 2).

w Consolidated-to-parentcompany sales ratio has
stably been around 1.1-1.2.
The summed recurring
profit of the consolidated
subsidiaries (consolidated
minus parent) has been asurplus.

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 has posted a net profit(including this fiscal year’s forecast).
Additionally, the summed profit/loss of the subsidiaries, calculated byconsolidated minus parent-company recurring profit, has been a surplus
since FY2016 (Figure 3 on page 8).
Among the subsidiaries, Xronos seems to be continuing to contribute themost to the financial results, thanks to the work-style reform. Its sales wereY1.5 billion in FY2019, Y2.1 billion in FY2020, Y2.16 billion in FY2021,
Y2.21 billion in FY2022, and Y2.53 billion in FY2023 (+15% YoY). For
FY2025, Xronos had expected its sales to be Y4 billion (according to
Xronos’s former website).
Although Xronos’s profits have not been disclosed, it has mostly likely
been staying profitable along with KEC and contributing positively toconsolidated profits.

【Figure 2】Ratio of Consolidated to Parent Company’s Sales (ratios shown on upper portion of graph)
Unit: million yen

Sales of parent company

Consolidated sales minus parent company sales

16,000
1.1

1.1

1.1

1.1

1.1

1.1

14,000

1.1

1.1

1.2

1.2

1.3

887
3,023

1,167

12,0002,659

Consolidated
to parent
company
ratio

2,568

712

10,000

782
732

8,000

681

825

680

13,3796,000

10,727

9,693
4,000

7,487

7,761

FY2015FY2016

8,628

8,960

FY2017FY201812,141

10,723

10,413

FY2022

FY2023

11,6772,000
0FY2014FY2019FY2020

FY2021

FY2024 CE(Ref) Prepared by Alpha-Win Research Dept. based on the securities report. CE: the Company’s plan.

7/43
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: 6/23/2023【Figure 3】Ratio of Consolidated to Parent Company’s Recurring Profit (ratios shown on upper portion of graph)
R.P. of parent company

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

Unit: million yen

3,000

1.2

N.A

1.6

1.1

1.0

1.2

1.2

1.2

1.2

402

2,500

Consolidated
to parent
company
ratio

1.1

1.3

115

329

1,211

1,149

FY2023

FY2024 CE

470
443

2,000
1,500
1,000

221

500

918

2,406

238
34

1,897

59
-139

26

2,227

1,039

800
405

0
-19

41

-500
FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022(Ref) Prepared by Alpha-Win Research Dept. based on the securities report. CE: the Company’s plan.

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 Founded by certified public
accountants

The Company’s financial standing is firm, rich in cash and debt-less. Whileits sales are Y13 billion (last fiscal year’s result) and total assets are Y30.6
billion, it has Y17.8 billion in cash and deposits, which is equivalent to 58%
of total assets and 16.5 months’ worth of average monthly sales (values asof the end of March 2023).

w Rich in cash. Debt-lessmanagement.

In addition, it owns more than Y3 billion in securities, which are mainly
corporate bonds and listed stocks.
w FCF is positive. Cash &deposits are increasing andexceeding annual sales. Its
financial standing its firm.

Its free cash flow (FCF) has been positive except during a certain period,and cash and deposits on the balance sheet (B/S) have been generally
increasing (Figure 4). Regarding the financial ratios, its equity ratio is56.9% and current ratio is 208.9%, indicating financial soundness (values
as of the end of March 2023).

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

FY2010FY2011FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

FY2023Operating CF

①

627

488

141

847

1,048

547

1,427

1,533

1,270

2,141

3,328

1,632

3,684

2,641

Investing CF

②

-405

-127

185

-407

-750

-606

-627

-395

1,715

-80

-719

253

708

-308

Financing CF

-207

-210

-205

-215

-216

-284

-214

-215

-216

-572

-225

-355

-254

-606

FCF ( ①+②)

222

361

326

440

299

-60

800

1,137

2,985

2,061

2,609

1,885

4,392

2,333

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

11,74916,09017,819(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 used in the CF calculation.

8/43
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: 6/23/2023◆ Business Philosophy
w The Group’s basic
business policy is to “aimfor a more rational
business managementwith clear vision.”w The mission statement isto “contribute to society
by developing andproviding packaged
enterprise system
software that enables
high-level automation.”

The Company’s business philosophy was clearly declared as “customerfirst” when it made its first public offering in March 1994. Then, in 2010,it laid out its mission statement, the three key ideas of its businessphilosophy, and 34 rules for the code of conduct, and announced that thebasic business policy of the PCA Group is to “aim for a more rational
business management with clear vision.”
The Company’s mission statement is to “contribute to society by
developing and providing packaged enterprise system software that enables
high-level automation.” While its corporate culture is down-to-earth andhomely, the Company is also characterized as having a pioneering spirit in
the rather conservative industry, conducting R&D and launching new
products and services ahead of its competitors.
The following are the three key ideas of the Company’s businessphilosophy:
1) We will always be customer-first.
2) We will aspire to become a highly profitable company over the long termwith sound management.
3) We will treat employees like family and create a homely culture.

◆ Renewed Tagline and Product Brand
w The new tagline is “When
WORK Changes”【Figure 5】New Tagline

TaglineAs the new brand message, the tagline was renewed to “When WORK
Changes.” Aspiring to become a company that grows together with all its
customers and partners, it aims to help improve back-office productivity,
understand and support the working people, and contribute to its corporate
customers’ customer success for their greater development (Figure 5).
【Figure 6】New Brand Logo

(Ref) Website

w Renewed the names andlogo designs of its productseries. The rebranding is
aimed at raising
recognition as a
subscription brand.
(3) PCA Subscription: Instead ofpurchasing or owning packaged
software, monthly or annual
fixed fees are paid for its use. Not
cloud-based; operating
environment is built andmanaged in-house.

Branding
In January 2022, the Company rebranded the names and logos of its
products and services. It created new product names and logos linked with
PCA Cloud and PCA Subscription3. Through these changes, it aims to raise
its brand recognition as PCA of subscription services (Figure 6). The
following is the meaning of the logo:
The “P” in PCA is “P” as in “Professional.” It is also the “P” as in“Person” and “Partner.” It’s not just the creators of the accounting
software, but also the people who use it and the people who connect
the creators and the users. We are committed to ensuring that thepower of each and every working person will help companies, theeconomy, and the society evolve always toward a bright future. From
foundation until now, the logo of PCA has been alongside each andevery worker, with the reassuring face of a person looking toward
tomorrow in the middle of each “P.”
9/43

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: 6/23/2023

2．Business Description and Business Modelw Enterprise systems are
mission critical. Stability
and reliability are crucial
elements since they areused in companies.

◆ Enterprise System Software Crucial for Efficient
Business Operations
The Company’s core business is enterprise systems that support internalbusiness operations. Unlike systems that simply work on PCs, an enterprisesystem is a computer system that supports a series of processes throughout
all business operation flows within a company. Since it is mission-criticalfor business operations, it is required to be reliable, efficient, stable,
convenient, 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 characteristics, operations, management
styles, and other specific needs.
As for original software development and implementation, outsourced
development and in-house development are the two methods. 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 greater, and it will need revisions, addition of functions,and maintenance after implementation. Micro-sized, small-sized, mediumsized, and mid-tier companies especially tend to find the development,
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 it has also been expanding its business byproviding proposal-based consulting services. With its subsidiaries, it has
also been providing various support services such as maintenance service
and implementation/operation support. Going forward, the Company plansto further strengthen these businesses.

w Provides about 26 types oforiginally developed,
packaged enterprisesystem software◆Highly Maintainable
Marginal Profit Ratio

Business

Model

with

High

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.

10/43This 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 80% of sales come fromoriginally developed
products and services.

w Entry barrier is high sincecredibility and proven trackrecord are necessary.

Issued: 6/23/2023
Its original products and services (products/maintenance/cloud) account for
80% of total sales, while the remaining 20% 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.
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 proactively or
frequently replacing their current software with an alternative of a different
company.
Therefore, customer loyalty and contract repeat rates are high (50% to 90%
or greater depending on the type of software). The barrier to market entry
is high because credibility and brand recognition are a must in this industry
and since companies have been able to adjust toward coexistence within themarket to a certain extent by taking strong positions in different niches.

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

Stable and Profitable

Until FY2016, sales and profit/loss had been disclosed for the four businesssegments of “for ordinary companies,” “for non-profit organizations,”“medical,” and “cloud.” Since FY2017, though, all business segments havebeen consolidated into one. Instead, sales are disclosed for five sales
categories (types): “products,” “merchandise,” “maintenance service,”“cloud service,” and “other operating revenue” (also called “solutions”)(Figure 7). Profit and loss by segment are no longer disclosed.

【Figure 7】Sales Classification (by category)Sales Classification by
Category

Products
Merchandise
Maintenance Service
Cloud Service
Other Operating Revenue

Contents
Sales of original packaged software (accounting, sales management, purchasing and inventory management, payroll, HR, etc.)
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 via the cloud
Sales of other companies’ products such as software/hardware combined with its original products; also called “solutions”

Total & Average
Reference

FY2023 (results)
Sales (million yen)

% of Total Sales

Est. Gross Margin

1,149
577
3,327

8.9
4.5
25.6

About 65%
About 30%
About 75%

5,956
1,969

45.9
15.2

About 65%
About 54%

12,981

100.0

Result: 62.0%

Estimated weighted average: 62.3%(Ref) Prepared by Alpha-Win Research Dept. based on the securities report and interview. Gross margins have been estimated by Alpha-Win.
(Note) Maintenance service and cloud service are the subscription-based businesses.

w Subscription-based
businesses (maintenance& cloud) account for about
72% of 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 FY2023, sales of
the cloud service were the largest among the sales categories, followed bymaintenance service. The sum of these two categories, or subscriptionbased revenue (also called the “stock business” in Japanese), accounts forabout 72% of total sales. The maintenance and the cloud services have highgross margins and contract repeat rates and they have been stable sourcesof profit, contributing to greater stability in terms of management and profit.

11/43
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: 6/23/2023
On the other hand, sales of products and solutions (other operating revenue)
tend to be impacted by event-driven high demand, replacement cycles, andversion upgrades.
Consolidated sales breakdown by the operation type of software is notdisclosed. However, sales are diversified, with the sales of accounting
software predicted to be the largest by composition (about 15% of total
sales), followed by software for sales management, purchase/inventory
management, and then lastly payroll/HR.
The Company has commented that the profit margins of each operation typeof software do not greatly differ between one another, but the main
accounting software is generally the most profitable.
The percentage of new software sales or version upgrade sales in 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 from sales

For many years, the Company had been focused on the business of selling
conventional packaged software, also known as on-premises software.
However, as the Internet became more sophisticated and widely used, it
predicted that the demand for cloud services will rise due to its convenienceand cost performance. Therefore, in 2008, the Company started providing
cloud services more than ten years ahead of its competitors. Since then, it
has been providing cloud versions of all of its on-premises software.

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

In the cloud business, users pay fees continuously for some span to use thesoftware (subscription model). Like the maintenance service, it is attractive
as a stable, subscription-based business model (average monthly fee of 2030 thousand yen per corporate user).

of packaged software to thecloud/subscription-based
business model(6) API (Application
Programming Interface):
Interface/network to use
software; connects the softwareand the program.
(7) Kintone: Cloud service forbuilding business app on a web
database, provided by Cybozu.
Allows easy system building 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.

Due to its cost structure, this business has relatively small variable costs
such as those for server maintenance, manufacturing, sales, and logistics.
It therefore has a high marginal profit ratio.
The Company leads the industry as the top player for cloud-based,
enterprise system software targeting small/medium-sized companies. In
recent years (2017-2018), its competitors have also entered the cloudmarket in full scale as their “first year of the cloud.” However, due to theadvantages and points of differentiation listed below, the Company is
expected maintain a competitive edge against its competitors for the
meanwhile.
・ 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 21,000 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 service (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).

12/43
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: 6/23/2023
The Company has been focusing on cloud services for more than a decade,and both the number of corporate users and sales have been growing
steadily (Figure 8). The growth rate has slowed with the expansion ofbusiness scale, but this is most likely partly in reaction to the event-driven
high demand in the previous fiscal year (the shift from the X series, or theCompany’s previous products, to the PCA Cloud). Both the sales and thenet increase in the number of users have been recovering on a quarterly
basis (Figure 25 on page 29) and the business will most likely continue toserve as the growth driver.

【Figure 8】Change in the Number of Corporate Users of PCA Cloud (nonconsolidated figures)and Consolidated Sales of the Cloud
30,00010,000

Sales of the cloud service (right axis: million yen)
25,000

Number of corporate users of the cloud service (left axis: companies)

9,000
8,000
7,000

20,0006,000
15,000

5,000
4,000

10,000

3,000
2,000

5,000

1,000
0

FY
20
08
FY
20
09
FY
20
10
FY
20
11
FY
20
12
FY
20
13
FY
20
14
FY
20
15
FY
20
16
FY
20
17
FY
20
18
FY
20
19
FY
20
20
FY
20
21
FY
20
22
FY
20
23
FY
20
24
E
FY
20
25
E
FY
20
26
E

0

(Ref) Prepared by Alpha-Win Research Dept. based on the Company’s financial results briefing materials and interview. “E”
represents estimates/forecasts made by Alpha-Win Research Dept.
(Note) Sales from FY2008 to FY2010 are not disclosed. The number of corporate users of the cloud service includes estimates.

w The PCA Hub services,

centered on PCA HubeDOC, were started in
March 2022. Cloud service
for document managementthat also supports theElectronic Books
Preservation Act.

(9) (PCA) hyper: New software
for mid-tier companies as a
successor to Dream21. A
superior version of the DX
series. A company can choose
flexibly between the on-premises
or the cloud version, depending
on its stage of growth. Its uniquefeature is that smooth linkage
can be made with other systems
using API, allowing streamliningof data management within a
corporate group (consolidated
accounting).

◆ PCA Hub Series
The PCA Hub service (hub as in “the center of something”) was started in
March 2022. PCA Hub is a series of new services that help small/mediumsized and mid-tier companies share core business data and shift to paperlessinternal operations and B2B transactions, thereby contributing to thedigitization of the Japanese society.
The concept of the PCA Hub series is “supporting companies and thesociety 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 has beenreleased (PCA Hub eDOC is a part of the PCA Hub services).
PCA Hub eDOC is an online storage service (cloud-based document
management service) that enables companies to safely and securely shareimportant business data and files internally. Also linked with the PCA DX
series and the hyper9 series, it is a tool for optimizing operation efficiency.
It enables the digitization and paperless operation of fund management,
accounting management, labor management, and so on. It also supports the

13/43
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: 6/23/2023(10) [The revised] Electronic Books
Preservation Act: A law that allows
the storage of national-tax-related
books and documents as electronic
data. Came into effect in January
2022. Its purpose is to improve
productivity and convenience, as wellas promoting paperless operation andremote work. Its grace period will end
at the end of 2023.
(11) JIIMA certification: “Legal
Requirements Certification Programfor Scan-Store Software in Applying
the Electronic Books Law” by theJapan Image and Information
Management Association (JIIMA).
Checks whether commerciallyavailable software meets therequirements of the Electronic Books
Preservation Act and certifies thosethat have been judged to meet thelegal requirements.
w The PCA Hub series is aservice based on monthly
subscriptions. Aiming for 2,000
users within 1 year after release(total of the entire PCA Hubseries).
(12) New invoicing system: The
Qualified Invoice Preservation
Method, which will start in October
2023. A new system for issuing andstoring invoices and delivery slips,
created for the purpose of accurately
recognizing the amount ofconsumption tax in transactions.

requirements of the Electronic Books Preservation Act10 and has acquired
the JIIMA certification.
Following PCA Hub eDOC, the PCA Hub eDOC AI-OCR Option was
released in November 2022 as part of the PCA Hub series (see Figure 9 forthe lineup of the PCA Hub series).
In addition to this, in March 2023, the Company released web-based
delivery services for invoices that also support electronic invoices (such as
the conversion of invoices to electronic forms) and for pay slips (pay slips,
withholding tax slips, year-end adjustment notifications, etc.).
The PCA Hub series are cloud-based subscription services that charge
monthly fees and are highly scalable. Each service has price plans based on
options such as the number of users, storage amount, the number of
employees, and the number of invoices created, providing a pricing
structure that lowers the hurdle of starting software use.
The Company aims to gain a total of 2,000 corporate users within one year
after the release of the current three services (eDOC, Invoice, and Pay Slip)(sales target not disclosed). Although it used to purchase and sell othercompanies’ software, treating them as the solutions business, it now plansto sequentially develop products in response to customer needs, switching
to its original products and providing various peripheral services as the
PCA Hub series. The Company intends to develop this business into astable revenue source.
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.

【Figure 9】Lineup of the PCA Hub Series and the Release Schedule Including the Conventional Products
Date

Service/productSituation

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 Preservation Act and can be used to store
receipts, invoices, and other vouchers.

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.

November 2022

PCA Hub eDOC AI-OCR Option

Notes (characteristics)

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

Released / Service started

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

Around summer 2023

Current main products

Not disclosed

Various peripheral services for PCA Hub

Released / Service started

Service specialized in web-based pay slip delivery. Calculation results of the PCA Salary series can beimported 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

The hyper/DX series (packaged versions), PCA Cloud (including onAWS), PCA Subscription, andPlanned to become compatible
PCA Hub will all be compatible; X series and other products whose support has ended will not bewith the new invoicing systemcompatible.
Release planned

Services for labor-related processes, tax declaration, etc. (details not disclosed)(Ref) Prepared by Alpha-Win Research Dept. based on the financial results materials and news release on its website

14/43
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: 6/23/2023

3． Shareholder Composition◆ Change in Composition by Type of Shareholder
Regarding shareholder composition by shareholder type as of the end of
March 2023 (Figure 10), the sum of “other corporate entities” and“individuals and others” (including treasury shares) accounts for greaterthan 70% of the total. There has been no large change compared with theend of FY2022, with the proportion of “individuals and others” decreasing
by about 2 percentage points to about 27%, “financial institutions” staying
about the same at about 8%, and “overseas corporate entities” rising by
about 2 percentage points to 19%.

w No large change to the
proportion of each type ofshareholder

w Shares were transferred
due to inheritance andother events, but thelargest shareholder has notessentially changed.

Note that upon inheritance from the founder (Masao Kawashima),
individually owned shares were transferred in FY2017 to the generalincorporated association Kawashima Co., Ltd. (the founder family’s asset
management company, categorized under “other corporate entities”).

【Figure 10】Change in Shareholder Composition by Type of Shareholder (unit: %)
(%)
90
80
Other corporate
entities

70
60
50

46.78

Individuals andoth ers

40
30

26.68
19.02

20
10
0

7.51
FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

FY2023

Overseas
corporate
entities
Financial
institu tion sat year-end(Ref) Prepared by Alpha-Win Research Dept. based on the securities report◆ Major Shareholder Composition
w No change to stableshareholders in Japanw。

Major shareholders as of the end of March 2023 are shown in Figure 11 on
page 16. Compared to the end of March 2022 (the same point of comparison
applies below), shares held by the top ten major shareholders have notlargely changed except for the custodians (trust banks) and the Employee
Stock Ownership Plan.

w The largest shareholder is

・The largest shareholder Kawashima Co., Ltd. (hereinafter, “Kawashima”)
is the asset management company of two directors of the Company(President Sato and Director Kumamoto) and their relatives (descendants
to the founder Masao Kawashima). Its shareholding ratio remains
unchanged at approximately 41% (ratio to total outstanding shares
excluding treasury shares; the same applies hereinafter).

w PCA owns 9.1% of its own

・ The Company itself has long been essentially the second largest
shareholder (although not listed among the major shareholders). After
Kawashima had indicated its intention to sell a part of its shares, thethe founder family’s asset
management company.

shares and is essentiallythe second largest
shareholder.

15/43
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 thiswThis
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,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: 6/23/2023
Company acquired additional shares through a tender offer and other means.
Currently, the treasury shares currently owned by the Company is approx.
9.1% of all outstanding shares.

【Figure 11】Current Major Shareholders
Units: thousand shares for the number of shares owned and % for the ratios andproportions

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
Logic Systems Co., Ltd.
Nagoya PCA Co., Ltd.
APPLIED SYSTEM LABORATORY Inc.
State Street Bank and Trust Company 505001
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 M LSCB RD

Unit for shares owned: thousand shares

End of Mar.
2015

End of Mar.
2016

End of Mar.
2017

－
2,544
－
－
－
762
－
330
342

－
2,544
－
－
－
762
－
357
342
300

732
－
－
－
－
－
－
－
－
－
363

747
－
－
－
－
－
－
－
－
－
363

8,805
2,544
－
－
－
762
－
381
342
300
258
798
－
－
－
－
－
－
－
－
－
363

End of Mar.
2018

8,805
2,546
－
－
－
762
－
381
342
300
258
798
－
－
－
－
－
－
－
－
－
363

End of Mar.
2019

For proportions and ratios: %End of Mar.
2021

End of Mar.
2022

End of Mar.
2023

521
909
－
－
－
－
－
－
－
－
363

8,205
3,136
－
－
885
762
－
300
342
300
258
－
－
－
－
－
－
－
1,416
267
261
－

8,208
3,101
1,014
284
886
762
－
337
342
300
－
－
－
－
463
359
－
－
－
－
－
－

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

8,208
2,001
1,399
948
886
762
450
392
342
300
260
－
－
－
－
－
－
－
－
－
－
－

8,208
3,146
－
－
－
762
－
406
342
300

End of Mar.
2020

－

－

－

－

－

－

－

－

－

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

543
－
4,401
4,401

543
－
4,401
4,401

543
－
－
－

453
270
－
－

335
282
－
－

－
－
－
－

－
－
－
－

－
－
－
－

－
－
－
－

Hiroko Wada (individual)
Proportion (%) of Treasury Shares to All Outstanding Shares

1,074
11.0

－
11.0

－
11.1

－
11.0

－
13.6

－
13.6

－
13.4

－
13.4

－
9.1

Shareholding
Ratio

41.04
9.10
6.99
4.74
4.43
3.81
2.25
1.95
1.71
1.50
1.29

RankingChange(2023 minus 2022)

1
―
2
3
4
5
6
7
8
9
10

0
-1,100
0
-189
0
0
73
42
0
0
0

(Ref) Prepared by Alpha-Win Research Dept. based on the securities report. (Note) The number of shares has been retroactively adjusted for the 3-for-1 stock split
conducted in October 2021.

w Several Japanese and・The shares owned by the second largest shareholder, JP Morgan Chase
Bank, have not changed.
・The shareholding ratio of the third largest shareholder, the Master Trust
Bank of Japan (trust account), fell from 5.7% to 4.7%. Meanwhile, theshareholding ratio of the fourth largest shareholder, MSIP CLIENTSECURITIES, has not changed.
・ Although there are trust banks and custodians among the major
shareholders, including those mentioned above, their final investors andinvestment purposes are unknown. However, they are most likely forpurely investments by Japanese and overseas institutional investors andfunds.

w MFS, a major US-based

Massachusetts Financial Services Company (“MFS”) owned 5.22% ofshares (401,900 shares) as of March 31, 2021, and had submitted astatement of large-volume holdings (the “5%-rule” statement). It later
purchased more shares and submitted a change report indicating that it held
6.23% (479,400 shares) as of May 31, 2021. A change report has not been
submitted since then.

overseas institutional
investors are mostly likely
investing in the Company
through custodians.

investment management
firm, holds more than 5%of all shares and has
submitted a statement oflarge-volume holdings. It
seems to be continuing tohold the shares.

MFS is one of the oldest investment firms in the US. It invests globally andits AUM is 547.5 billion dollars (approx. 72 trillion yen as of the end of
December 2022). Characterized by a long-term and active investment style,it also has an office in Japan and currently invests in many Japanese equities.
Although MFS is not included in the list of major shareholders shown in
Figure 11, it is presumably investing through several accounts including JP
Morgan Chase Bank at second place (ranking excluding the Company andits treasury shares; the same applies hereinafter) and MSIP at fourth place.

16/43
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 Japanese investment

trusts investing in the
Company are mainly index
funds.

w Its rival OBC is also thefifth largest shareholder.

w A French investment fundis also a major shareholder.

Issued: 6/23/2023
Regarding investment trusts in Japan, the Company’s shares are mainly
incorporated in index funds including those managed by Sumitomo Mitsui
Trust Asset Management, Mitsubishi UFJ Kokusai Asset Management,
Asset Management One, and Daiwa Asset Management.
・The fifth largest shareholder, Obic Business Consultants Co., Ltd. (OBC;
listed on TSE Prime; securities code 4733), is a competitor with whom theCompany has no transactions. There has been no change in the number ofshares held.
Shareholding ratio of the sixth largest shareholder, FCP SEXTANTAUTOUR DU MONDE, increased from 1.9% to 2.3%. It is an equity
investment fund managed by the French company Amiral Gestion (anindependent asset management company founded in 2003 and focused onlong-term investments; total investment amount of 3.5 billion euro). The
fund invests in equities of OECD and emerging countries. The fundmanaged by this firm is also a major shareholder of several listed Japanesecompanies.
・The number of shares held by the Employee Stock Ownership Plan atseventh place has somewhat increased. However, there has been mostly nochange in the number of shares held by Logic Systems Co., Ltd.
(investment purpose unknown) at eighth place, Nagoya PCA Co., Ltd. (acompany to which the Company outsources a part of its softwaredevelopment for SHOKON and other products) at nineth place, and
APPLIED SYSTEM LABORATORY Inc. (investment purpose unknown)at tenth place.

w There seems to be no

activist among the major
shareholders.

・Currently, there seems to be no activist-like behavior among the major
shareholders. Also, the Company has not adopted any anti-takeovermeasures.

17/43
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: 6/23/2023

4．ESG and SDGs
In consideration of the sustainability of the environment, society, andeconomy, the Company works on the following initiatives from theperspectives of ESG and business sustainability (SDGs).

w Promoting paperless
operations and energy
saving◆ Environment
Since the Company does not own any production facility, its business is not
the kind that harms the environment. It has been working on digitalizing
internal documents and invoices to make them completely paperless. It also
makes consideration for business activity efficiency and the conservationof energy and electricity.

w Supporting digitalizationof small/medium-sizedcompanies◆ SocietyAs its mission statement, the Company has declared to “support customers’
businesses through enterprise system software.” The concept is that it isfulfilling its social responsibility by contributing to the improvement of userconvenience and efficiency. With services centered on the PCA Cloud, theCompany has realized labor reduction and automation for data entry
operations. It has been releasing various services over the years for the
productivity improvement of back-office operations and for business
continuity planning against disasters and other risks, as well as services
using AI. In this way, it aims to support rational management and safe
business operation by its users (small/medium-sized companies) based on
their data, as well as supporting their transformation into a digital company.

w Proactively supporting
people with physicaldisabilities and thediscovering/developing of
IT talents
w Working on improving theworking/workplaceenvironment
w Certified as the 2023
Health and Productivity
Management Outstanding
Organization (Large
enterprise Category)

The Company also provides various support such as helping discover anddevelop talented programmers who will create the future, promoting sports
such as marathons, and hiring people with physical disabilities.
In addition, under the concept that the enhancement of the working
environment of each individual will lead to the sustainability of theCompany as a whole, it has been focusing on promoting new work-styles
using the technologies and other expertise that it has cultivated through its
business activities. These include promoting the work-life balance,
introducing and encouraging remote work, and enabling employees to haveside jobs. It was certified as a 2023 Health and Productivity Management
Outstanding Organization (Large Enterprise Category) as an excellent
corporation working on health management in the Health and Productivity
Management Outstanding Organization Recognition System sponsored by
the Ministry of Economy, Trade, and Industry and Nippon Kenko Kaigi.
Pursuant to the Act on Promotion of Women’s Participation andAdvancement in the Workplace and the Act on Advancement of Measures
to Support Raising Next-Generation Children, the Company has beenworking on raising the percentage of female managers, raising the paid
holiday acquisition rate, providing financial support for child rearing, andpromoting the acquisition of annual paid holidays.

w Of the total of 11 directors,
two are women. Six are
external directors andauditors.

◆ Governance
For internal control, the Company has set up an internal audit office that
directly reports to the president, which is managed also in coordination withthe external directors. It has also set up a risk control committee with thepresident as the chairperson and has created a risk control system thatenables flexible, quick, and appropriate response to risks. It has not adopted
an executive officer system. There are a total of 11 directors, including
seven directors (reduced by one; three external directors) and four auditors(three of whom are external auditors, including a tax accountant, a certified
public accountant, and a lawyer). Of these directors, two are female
directors (after resolutions at the general meeting of shareholders).

18/43
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: 6/23/2023

5．History of Growth◆ Company History
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 promising future of computers and software businesses
in Japan. At first, they developed and sold business accounting software forsmall business computers. In 1995, expecting to eventually shift away fromusers of small business computers, the Company began focusing on thedevelopment and sales of packaged software for PCs.

w Founded upon recognizing
the importance andpromising future ofcomputers and enterprisesystem software in Japanw With a pioneering spirit,

became the first to begin
cloud services in theindustry

Then, with the emergence of the PC era, the Company has grown mainly
through the following four strategies: 1) creation of a greater variety of
packaged software for Japanese customers as well as their version upgrades,2) expansion of the maintenance service, 3) development of the cloudbusiness, 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 a service. Insteadof the user installing thesoftware, the vendor hosts thesoftware and provides thenecessary function to the user via
a network.

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. In April 2022, its listing was changed to the
TSE Prime Market.

w Changed its market listingfrom the Second to theFirst Section of the TSE in
Dec. 2014. Its listing waschanged to the Prime
Market in April 2022.

◆ 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 sales ofenterprise system software and related businesses. The transition in
financial performance since its first public offering is described in Figure
12. The following is supplemental information on the financial results inchronological order.

w Has been generally

increasing sales over thelong term. Profit had
weakened during a period,
but then recovered in a Vshape.

【Figure 12】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

8,000

1,396

1,227

1,218
794

1,565

1,084
935

12,981

1,392

7,551

1,181
6,383
6,336

6,269

798

13,308

2,000
1,478
1,500
1,326

6,805

834

1,139

724

2,500

13,382

9,785
9,360
1,277
8,441
8,168

1,582

6,006

2,340

3,000
14,70010,475

1,181

5,595
5,095
5,441
565
4,827
5,026 4,762
4,867
4,551
3,541
4,000
3,232
3,017
6,000 660

2,697

6,275

1,000

463
6,167
5,867

500
501 384

67
0

2,000
-158

-500

FY
19
94
FY
19
95
FY
19
96
FY
19
97
FY
19
98
FY
19
99
FY
20
00
FY
20
01
FY
20
02
FY
20
03
FY
20
04
FY
20
05
FY
20
06
FY
20
07
FY
20
08
FY
20
09
FY
20
10
FY
20
11
FY
20
12
FY
20
13
FY
20
14
FY
20
15
FY
20
16
FY
20
17
FY
20
18
FY
20
19
FY
20
20
FY
20
21
FY
20
22
FY
2
FY 0 23
20
24
CE

0

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary.
Estimate/forecast (CE) for FY2024 is from the Company’s plan.

19/43
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: 6/23/2023
・Aside from certain periods such as the post-Lehman-collapse economic
downturn and the declines following high demand stimulated by revisions
in tax and other regulations, the Company has generally kept increasing
sales since 1994. On the other hand, profit growth had been slow for sometime, being unable to maintain or exceed the high level of profit that it had
once achieved.

w Record-high net profit

・Record-high net profit (Y937 million) of the time was achieved in FY2000,
thanks to the sales growth from the high demand brought by the year 2000
problem. The consecutive decline in sales and profit from FY2001 to
FY2002 occurred in reaction to this high demand as well as due to theeconomic downturn.

w In FY2006, record-high

・In FY2006, record highs of the time were achieved for operating profit
and recurring profit (Y1,747 million and Y1,783 million, respectively).
These record highs were due to the demand stimulated by the revision of
the accounting regulation for public benefit corporations and the drasticchange in regulations caused by the new Companies Act, as well as due tothe improvement in profitability thanks to the Company’s ERP14 (integrated
enterprise system) product, Dream 21.

achieved in FY2000 owing
to the high demand
stimulated by the year 2000
problem.

operating/recurring profits
were posted thanks toregulation revisions andERP.

(14) ERP (integrated enterprisesystem): Stands for Enterprise
Resource Planning.
Management concept based on
the integration and real-timeprocessing of core businessinformation to efficiently
optimize as a whole. Provided as
IT solutions software that
integrates enterprise systems.

w Results weakened after the

Lehman’s collapse. In
FY2014, record-high sales
were posted due to an
event-driven high demand,
achieving Y10 billion insales.

w Net loss posted for two

consecutive fiscal years in
FY2015 and FY2016,
partially in reaction to theprevious event-driven highdemand.

w Positive effects of thestructural reform havestarted to be seen in
FY2016 onward.

w Growth of the cloudbusiness, release of new
products, and cost
reduction have helpedwith its performance.
Operating margin
improved.

・The sales decline for four consecutive years from FY2007 to FY2010, as
well as the profit decline for seven consecutive years from FY2007 to
FY2013, was caused by the decrease in demand due to the post-Lehmancollapse economic downturn and the increase in personnel, R&D, and sales
promotion expenses, as well as by worsened profitability due to intensifiedcompetition.
・In FY2014, record-high sales (Y10,475 million) were achieved thanks to
the high demand driven by two events: the end of Windows XP support(support ended in April 2014) and the change in consumption tax (from 5%
to 8% in April 2014). The large growth of the cloud service also contributed
to the record-high sales.
・Despite efforts to cut down on cost, a net loss was consecutively posted in
FY2015 and FY2016 (net loss for the year: Y207 million in FY2015 andY93 million in FY2016) due to the sales decline in reaction to the highdemand stimulated by the two events as described above and the postponed
revision of consumption tax to 10%.
・For many years, the Company’s gross margin and operating margin had
been gradually decreasing (Figure 13 on page 21). This was due tointensified price competition among packaged software makers during the
economic downturn, worsened product mix from a rise in the percentage ofother companies’ less-profitable goods, and higher costs, especially laborcosts, various expenses (subcontracting costs), and R&D expense.
・However, since FY2016, the Company has been increasing sales again
and the decline in gross margin has stopped. Operating margin bottomedout and began to gradually increase thanks to increased sales of the new
products and the cloud service as well as cost reduction. The Company also
saw positive results from the structural reform that it had been working on
for several years, including the disposal of assets with impairment risk (realestate and securities) and shortened software amortization period.
・Its growth and recovery in financial performance after this were supported
by sales growth of the cloud and maintenance services and cost reduction.
20/43

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 Turned to sales/profit
growth trend starting in
FY2016. Stabling posting a
net profit. V-shaped
recovery of results.

w Significant sales/profit

growth in FY2020 due tothe high demand
stimulated by the
consumption tax revisionand the end of Windows 7
support. Posted recordhigh sales and profits.

w Financial results arelargely impacted before
and after event-driven
demands.

w For the past seven fiscal

years, its profit results
have exceeded its initialplan. In the past, revisions
to financial forecasts haveoften been announced in
September or January to
April of the following year.

(15) [New] revenue-recognition
standard: Accounting Standard
for Revenue Recognition (ASBJ
Statement No. 29) and otherstandards set by the AccountingStandards Board of Japan(ASBJ), which incorporate theconcepts of IFRS-15. Large
companies have been required toapply this standard starting in
April 2021.

Issued: 6/23/2023
・ From FY2016 to FY2020, the Company increased sales for five fiscal
years in a row thanks to the continued growth of the cloud service, therelease of the new products, and strengthened sales force, as well as due toeconomic recovery. Since FY2017, the Company has recovered in a Vshape and has been stably posting a net profit.
・Especially in FY2020, thanks to event-driven high demand (rise in the
consumption tax rate, end of Windows 7 support, and version upgrades
related to the change in the name of the era created an early demand), sales
and profit grew significantly, hitting their record highs (sales, operating
profit, and recurring profit).
・In reaction to this event-driven high demand, sales and profits turned to a
decline in FY2021. In FY2022, although there was a negative impact fromthe change in the revenue-recognition standard15, sales and operating profit
became the second highest in the Company’s history due to the highreplacement demand in response to the end of support for its older products(record high was only achieved for net profit, with the gain on sales of
securities). In reaction to this event-driven demand for the products, sales
and profits declined in FY2023.
As reference, the Company’s past initial forecasts and actual results over
the years were compared (Figure 14). Since FY2017, the profit results havetended to exceed the initial plans/forecasts made at the beginning of fiscal
years. Note that past announcements of revisions to financial forecasts haveoften been made in September or January to April of the following year.
【Figure 13】Long-Term Transition in Gross Margin and Operating Margin
Gross Margin（％）

Operating Margin

80.0
70.0

70.1

66.4

66.8

66.1

63.2

65.8

63.0

60.3

60.0

53.5

51.0

57.0

54.5

60.3

62.0

60.1

59.8

50.0
40.0
30.0
20.0

19.5

17.8
12.7

11.1

10.0

6.9

10.6
4.7

4.6

0.5

0.0

19.8

17.4

10.9

8.2

9.9

9.8

FY2023

FY2024
CE

-2.2

-10.0
FY2009FY2010FY2011FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022【Figure 14】Comparison of the Company’s Initial Financial Forecast and Actual Results over the Years
Consolidated

Sales
Initialforecast

Operating Profit

Recurring Profit

Net Profit Attributable to
Owners of the Parent (hereinafter "net profit")

ActualInitialActualInitial forecast Actual result
Initial forecast
Actual result
resultforecast
result
FY2001
5,026
1,224
1,227
695
FY2002
5,634
4,762
925
1,215
935
533
FY2003
5,104
5,095
1,073
1,015
1,083
589
576
FY2004
5,521
5,595
1,170
1,125
1,181
653
682
FY2005
6,096
6,005
1,551
1,293
1,565
769
915
FY2006
6,870
6,383
1,747
1,780
1,783
1,059
327
FY2007
6,860
6,336
1,533
1,550
1,582
922
852
FY2008
6,790
6,274
1,321
1,325
1,365
1,391
812
644
FY2009
6,800
6,268
1,294
1,117
1,360
1,181
809
680
FY2010
6,500
5,867
1,141
744
1,200
797
714
436
FY2011
5,908
6,166
878
686
927
724
519
411
FY2012
6,505
6,805
806
468
835
501
381
75
FY2013
7,025
7,550
56
354
84
383
29
181
FY2014
8,641
10,474
284
1,110
311
1,138
141
604
FY2015
9,198
8,168
453
-179
483
-157
283
-207
FY2016
8,880
8,440
242
40
272
66
131
-93
FY2017
9,731
9,360
165
432
187
463
51
160
FY2018
9,876
9,785
645
807
669
834
425
441
FY201910,486
11,439
825
1,248
842
1,277
588
906
FY202012,783
14,266
1,478
2,781
1,499
2,808
976
1,816
FY2021
13,28013,308
2,034
2,314
2,055
2,340
1,358
1,668
FY2022
12,447
13,382
1,866
2,655
1,899
2,697
1,192
2,367
FY2023
12,927
12,981
1,100
1,288
1,132
1,326
639
883
FY2024 CE
14,700
1,445
1,478
925
Reference: simple average of difference (unit: %), calculated based on the longest period with data available for both sales & profits(excluding periods with loss and this FY) →Number of times revised upward:downward fromGreen highlight: Pink highlight: 2nd Yellow highlight: 3rd ←All excluding
highest record
highest record
this FY's forecast
initial forecast (unit: # of times)→
Record highUnit: million yen

Operating
ProfitSales

Recurring
ProfitNet Profit

Difference from initial forecast

Operating
ProfitSales

Recurring
ProfitNet Profit

YoY change in actual results-15.5%-23.0%
-0.2%
6.7%
-2.2%
1.3%
5.0%
4.4%
-1.5%
21.0%
19.0%
-7.1%
0.2%
-69.1%
-7.6%
2.1%
-7.6%
-7.6%
0.3%
1.9%
-20.7%-7.8%-13.7%-13.2%-15.9%-9.7%-34.8%-33.6%-38.9%
4.4%-21.9%-21.9%-20.8%
4.6%-41.9%-40.0%-80.3%
7.5%
532.1%
356.0%
524.1%
21.2%
290.8%
265.9%
328.4%-11.2% Revied down Revised down Revised down
-5.0%
-83.5%-75.7% Revised down
-3.8%
161.8%
147.6%
213.7%
-0.9%
25.1%
24.7%
3.8%
9.1%
51.3%
51.7%
54.1%
11.6%
88.2%
87.3%
86.1%
0.2%
13.8%
13.9%
22.8%
7.5%
42.3%
42.0%
98.6%
0.4%
17.1%
17.1%
38.2%
Ratio of This FY's Forecast to Last FY's Result ⇒
-0.5%

68.5%

39.8%

59.9%

10 ： 12

10 ： 6

15 ： 7

11 ： 10-5.3%-24.4%-23.8%-23.3%
7.0%
16.0%
15.8%
8.1%
9.8%
9.0%
9.0%
18.4%
7.3%
32.6%
32.5%
34.2%
6.3%
12.6%
13.9%
-64.3%-0.7%-12.2%-11.3%
160.6%-1.0%-13.6%-12.1%-24.4%-0.1%-15.7%-15.1%
5.6%-6.4%-33.4%-32.5%-35.9%
5.1%
-7.8%
-9.2%
-5.7%
10.4%
-31.8%-30.8%-81.8%
10.9%-24.4%-23.6%
141.3%
38.7%
213.6%
197.1%
233.7%-22.0% To loss
To loss
To loss
3.3% To profit To profit To profit
10.9%
980.0%
601.5%-272.0%
4.5%
86.8%
80.1%
175.6%
16.9%
54.6%
53.1%
105.4%
24.7%
122.8%
119.9%
100.4%-6.7%-16.8%-16.7%
-8.1%
0.6%
14.7%
15.3%
41.9%
-3.0%
-51.5%-50.8%-62.7%
13.2%
12.2%
11.4%
4.8%
5.1%

65.6%

45.6%

22.3%

↑ Simple average of all periods (excluding thisFY)(Ref) Figures 13 and 14: Prepared by Alpha-Win Research Dept. based on the financial results summary. The FY2024 forecasts/estimates (CE)are from the Company’s plan. (Note) The new revenue-recognition standard has been applied starting in FY2022 (CE).

21/43This 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: 6/23/2023

6． Business Environment◆Trends of the Software Market
w Decreasing number ofsmall/medium-sizedcompanies (its current andpotential users) in Japan,
but the size of theenterprise system software
market is expected tosteadily grow over the
medium to long term.

w The deterioration of theeconomic environment
surrounding small,medium, and mid-tiercompanies has eased andthe DI is flat. Software
investment is still on an
upward trend.

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 by anincreasingly serious labor 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 as the demand for software to improvebusiness operation efficiency increases.

Current Situation: BOJ Tankan
According to the Bank of Japan Tankan in March 2023, the growth in theamount of software investment planned in 2022 by small/medium-sizedcompanies (of all industries) was +4.5% YoY (of which, +15.0% formanufacturing and +0.8% for non-manufacturing), with growth especially
expected for the manufacturing industries. In 2023, the planned investment
amount has grown again at a higher growth rate of +6.2% YoY (of which,+12.5% for manufacturing and +3.7% for non-manufacturing). Mid-tiercompanies are showing an even more eager attitude toward software
investment, with a planned growth of +17.2% (+30.0% and +14.0%,
respectively) in FY2022 and +12.0% (+20.4% and +9.6%, respectively) in
FY2023.
Regarding the survey on business sentiment among small/medium-sizedcompanies, the recent sentiment was +4 in December 2022 and +3 in March
2023, and the outlook also changed from -2 to 0. The deterioration inbusiness sentiment has eased and is trending sideways (similar for mid-tiercompanies).

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 the increasing
digitalization and the shift to online activities, the B2B market seems to be
gradually expanding (our estimate for the annual growth rate is +4% to+5%). We also estimate the current size of the enterprise system software
market in Japan specifically related to the Company’s business to be approx.
Y500 billion. We predict its annual growth rate to be about 3% over the
medium term.
w Market potential of cloudbased enterprise system
software in Japan is stilllarge.

w

In the U.S., the utilization of cloud-based enterprise system software is said
to be several years ahead of Japan. The adoption rate in Japan is about ½ to
⅓ compared to the US (source: “WHITE PAPER Information andCommunications in Japan” by the Ministry of Internal Affairs andCommunications, etc.). Therefore, there seems to be a large growthpotential. The cloud-based enterprise system software market may grow at
a high rate of about 10-20% per year over the medium term as it replaces apart of the outsourced system development or packaged software (onpremises) market.

22/43
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: 6/23/2023◆Comparison with Competitors
w In the industry, companies

are moving toward acertain degree of
coexistence by taking
strong positions
depending on the user sizeor software function.

Positions and Main Players of the Industry
Figure 15 is an overview of the various positions and main players of theindustry, categorized by customer type. The players in the industry haveadjusted toward a certain degree of coexistence by taking strong positions
in different niches, segregated by the size of the companies/organizations
that are their users or the type of operation targeted by their software.
【Figure 15】Target Customers and Main Players of the Enterprise
System Software Market(Ref) Excerpt from past financial results briefing materials, partially edited by Alpha-Win
Research Dept.

w OBC, MJS, Yayoi, OHKEN,
and OSK are its rivals.

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; listed on the TSE Prime Market; securities code 4733)
and its indirect rival is most likely Miroku Jyoho Service (MJS; TSE Prime;9928). OBC is the greatest rival since it has a similar product lineup andbusiness model as the Company.
In addition, the following private companies are the main direct competitors,
both for the on-premises and the cloud-based software.
・Yayoi Co., Ltd.: acquired from Orix Corporation (TSE Prime: 8591) by
Kohlberg Kravis Roberts & Co. L.P. (“KKR”); sales in the fiscal year ended
September 2022 were Y22.1 billion; 850 employees; over 2.8 million
registered users.
・ OHKEN Co., Ltd.: the DAIJIN series are the main products; independentcompany; sales in the fiscal year ended December 2022 were Y5.24 billion;
340 employees.
・ OSK Co., Ltd.: the SMILE series are the main products; wholly-owned
subsidiary of Otsuka Corporation; sales in the fiscal year ended December
2022 were Y9.5 billion and net profit was Y1.24 billion; 468 employees.

w The Company provides

high-quality products andservices at reasonable
prices.

w Its flagship product, or theaccounting software, has
the third largest share in
the market.

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 (a share of about 10%). It also seems to have a similar level of market
share and position with its payroll and HR software.

23/43
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: 6/23/2023
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 mainly target one-person businesses andsmall companies such as small/medium-sized companies and SOHOs, sothey compete with the Company only in specific areas.

w In addition to OBC, also

competing with Money
Forward, freee, and Yayoi
for a part of the cloudbased accounting software
business.

Comparison of Profitability of the Three Competing, Listed
Companies
A comparison of the long-term transition in gross margin and operating
margin of the three competing, listed companies (the Company, OBC, and
MJS) is shown in Figures 16 and 17. Compared to the Company, bothmargins are stable for OBC and MJS. This is presumably due to thedifference in the business model, the sales composition, and scaleadvantage (the sales of OBC and MJS are about 2.6x and 3.2x greater thanthe Company, respectively, and similarly their operating profit is about
11.4x and 4.7x greater, respectively, according to last fiscal year’s results).

w Profit margins and capitalefficiency are generally
improving, but decreasedin the previous fiscal year.

Both competitors used to have a lower subscription rate for maintenancesupport but succeeded in raising this rate strategically, resulting in a greater
earning power. However, through its focus on the subscription business, theCompany’s profit margins have also been improving and becoming stablein recent years excluding the period of decline in reaction to an event-driven
high demand.

【Figure 16】Long-Term Transition in the
Gross Margin of the Three Major
Listed Companies (PCA, OBC, and
MJS)
PCA

（％）

OBC

MJS

90.0
85.0
80.0

83.4

84.2

84.0

66.4

66.8

66.1

65.9

65.0

84.4

83.7

84.3

84.8

65.2

66.3

84.7

84.4

84.0

82.5

83.9

83.8

82.6

82.6

62.0

63.1

79.0

The transition in the Company’s ROA and ROE, shown in Figure 18, showsthat they had been significantly improving in recent years due to profit
growth. In FY2023, though, the significant decline in profit caused theCompany’s ROA and ROE to be 4.5% and 5.1%, falling below OBC’s
9.0% and 8.0% and MJS’s 13.1% and 16.2%, respectively.

75.0
70.0

70.1

65.0
60.0
55.0

59.5

61.8

64.4
63.2

63.0

64.0

66.3

65.8

63.6

62.1
60.3

62.3

60.3

57.0
54.5

53.5

61.8

60.1

57.8

61.8

59.8

As reference, the overview of the three companies is compared in Figure
19 on page 25.

51.0

50.0
45.0
40.0

(Ref) Figures 16-18: Prepared by Alpha-Win Research Dept. based on the securities reports.
Estimates/forecasts (E) are from the companies’ plans.

FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024
CE【Figure 17】Long-Term Transition in the Operating
Margin of the Three Major Listed
Companies (PCA, OBC, and MJS)

【Figure 18】Transition in the Company’s ROA and ROE
（％）

ROA

16.0
PCA

（％）

50.0

46.7

45.6

40.9

43.4

45.0

43.2

OBC

41.7

42.7

MJS
44.4
41.4

43.2

44.2

47.1

43.6

43.1

14.3

12.0
10.0

6.0
19.5

10.0
4.3

12.7

11.1

10.3

10.9

10.8

11.3

12.9

6.9

0.0

16.3
8.2

6.2
8.0

15.6

4.6

10.6

16.5
14.7

17.4

13.3

10.9

19.8
14.7

14.7

0.0

13.1
9.9

9.8

0.5

4.7

-10.0
FY2010FY2011FY2012FY2013

-2.0
-4.0

-2.2
FY20092.0

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

FY2023

FY2024
CE

7.8

7.2

10.0

5.8

5.2

6.3

4.8
3.5

4.0

4.0
0.7

2.6
1.7

9.7
5.1

6.8

2.9

5.2

3.9

0.4
-1.0
-1.8

4.5

1.5
-0.9

FY
20
09
FY
20
10
FY
20
11
FY
20
12
FY
20
13
FY
20
14
FY
20
15
FY
20
16
FY
20
17
FY
20
18
FY
20
19
FY
20
20
FY
20
21
FY
20
22
FY
20
23

17.8

4.0

11.4
13.0

8.8

8.0
28.0

20.0

14.4

14.0

40.0

30.0

ROE

＊For ROA, the ratio of recurring profit to total assets was used.

24/43
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: 6/23/2023【Figure 19】Summary of the Comparison of the Three Competing Companies
Company Name

PCA

Obic Business Consultants （OBC）

Miroku Jyoho Service （MJS）

Code (listed on TSE Prime)

9629

4733

9928

Development and sales of packaged enterprise
Development and sales of packaged enterprise system system for small/medium-sized companies. Became Top market share (25%) in software for accounting
for mainly small/medium-sized companies. Secondtop-ranking in the industry from rapid growth in firms. Recently, also strengthening
tier in the industry. Taking a lead in cloud services.
the early days of the OS W95, NT, etc. Highly
development/sales of software for mid-tier andNo. 1 in industry in sales toward public benefit
profitable structure; largest player in the industry small/medium-sized companies. Largest player bycorporations.
by profit. No. 1 in packaged software for financial sales among the three companies.
accounting, payroll, HR, and labor management.

Characteristics

FoundedAug. 1980

Dec. 1980

Jan. 1977

Market Listing

Mar. 1994

Oct. 1999

Aug. 1992

Sales Categories/Breakdown(PCA, OBC, and MJS: FY ended March 2023)

Sales Method

Number of Bases・ Cloud Service 45.9%
・ Maintenance Service 25.6%
・ Products 8.9%
・ Merchandise 4.4%・ Solutions 15.2%

・Products 54.2%(Of which, solution technologies 44.7%)(Of which, related products 9.5%)
・Services 45.8%

・Revenue from services 34.3% (general maintenance)
・Sales from system installation contract 57.0%(Software 33.3%)(Useware 14.2%)(Hardware 9.5%)
・Other 8.6%

20% direct sales; 80% indirect sales throughdealers/makers

Nearly 100% indirect sales through dealers,makers, etc.

Nearly 100% direct sales; toward ordinary
companies, mostly direct sales through referrals byaccounting firms

13 sales offices; 2,000 sales partners

11 sales offices with customer service personnel;
3,000 sales partners

31 sales/support offices throughout Japan;
accounting firms acting as sales partners (referrals)

Number of Active Users (approx.)

200,000 companies

200,000 companies

8,400 accounting firms; 170,000 ordinary
companies

Percentage of Maintenance Service Subscription among Total
Number of Active Users

Approx. 70%

Approx. 80%

Nearly 100%・Focused on profit indicators. Maintaining or
Medium-Term Management Plan 2024 (FY2023 - FY2025)
increasing O.P. margin and R.P. margin while
・FY2023: Sales of Y13B (result: Y12.98B), O.P. of Y1.4B
increasing sales to continue to grow as a highly(result: Y1.3B), and O.P. margin of 10.7% (result: 9.9%)
profitable company.
・FY2024: Sales of Y14.7B, O.P. of Y1.4B, and O.P.
・Strengthen new sales by meeting needs (expansion of
margin of 9.8%
new sales and advertising strategy)
・FY2025: Sales ≥Y15B (of which, subscription-based sales
・Execute a strategy based on the cloud businesses and≥ Y9.5B), O.P. ≥Y2.5B, O.P. margin ≥16%, ROE ≥10%,develop a customer success system (retain current
DOE = 2.5%, and dividend payout ratio = 30%
customers)

Management Goals

Newly created the medium-term management plan Vision
2025 (FY2022 - FY2026). In the final fiscal year, it aims toachieve sales of Y55B (CAGR: 10.7%), R.P. of Y12.5B(similarly, 27.2%), record-high sales and R.P., and ROE
of more than 20%.
Conventional ERP biz: start digital marketing, shift tocloud and subscription models, secure a stable source ofrevenue, and achieve continuous growth.
New biz: Become No.1 in Japan as integrated DX platform
through which anyone can easily achieve DX to adapt tothe digital, non-face-to-face era.

・I. Establish a strong revenue base for the core businesses:
1) Further expansion of the cloud business withenhancement and expansion of PCA Cloud, 2) Accelerate
the shift toward the subscription-based business model,
and 3) Enhance customer success with digital tools.
Key Strategies
・II. Create new business opportunities: Applied research of・ "No. 1 in accounting firm network" strategy
・Meeting needs related to regulation revisions and DX
fundamental technologies including AI, finding and・ "Comprehensive solution business for mid-tier andCloud: Cloud-based DX to support the revised
creating new areas of business, and launching the PCAElectronic Books Preservation Act and the new invoicing small/mid-sized companies" strategy
Hub services
・ Integrated DX platform strategy (new biz area)system・III. Strengthen monozukuri (creation of things) with a・ Shift to cloud/subscription biz model・Up to Cloud: Conversion to Bugyo 11 (subscription
focus on safety, security, and anticipation of needs: Digital service) following the end of support for Bugyo 10 (at the・ Promote individual growth of subsidiaries(support DX of operations), Service (quick service
end of April 2024)
through group-wide coordination enhancement
development and release based on user-oriented approach),
・V ERP SaaS: Release Bugyo V ERP Cloud, a SaaS for ・ Build HR and management foundation to
and Modern (strengthen development system, expand the
mid-tier companies
accelerate strategy execution
PCA Hub series, and modernize in the area of enterprise・Price strategy: Revise prices to respond to changes insystems).
the external environment, including global conditions
・IV. Strengthen the management foundation toward a highprofit structure: Build and leverage the foundation for DX
acceleration, strengthen IT governance and security, andbuild a system that enables active engagement by a diverse
workforce.

Business Strategy and Areas of Focus

Main Types of Enterprise System Software or the Number ofProvided Products (approx.) or Services

・Approx. 26 types (by name of product; includes options)・Originally developed with in-house platform

・13 types for the flagship Bugyo series・Total of approx. 60-80 types by product name,including other software
・Development focused on Microsoft platform for bothon-premises and cloud services

・1 module for accounting firms
・6 modules for ordinary companies(each module contains software for several
operation types)

Sales (million yen): FY2024 CE

14,70037,000Gross Margin (%): FY2024 CE

59.8

82.6

63.1

Operating Profit (million yen): FY2024 CE

1,445

15,9506,100Operating Margin (%): FY2024 CE

9.8

43.1

14.7

EPS (FY2024 CE), YoY (%)

4.8

5.3

8.8

DOE (%): Result

2.0

3.8

5.8

Past 10 Years’ Sales Growth Rate (FY2023’s result divided by
FY2013's result: %)

71.9

99.1

98.2

O.P. Growth Rate (same condition as above)

263.8

100.4

167.4

Equity Ratio (%): Result

56.9

78.0

53.0

# of Full-Time Employees in the Group: Actual #

643

999

1,935

Sales Per Full-Time Employee (million yen / person)

22.9

37.0

21.5

O.P. Per Full-Time Employee (million yen / person)

2.2

16.0

3.2

5.1

8.0

16.2

6.8

32.7

9.1

0.4

0.2

0.9

1.7

1.3

1.9

4.5

9.0

13.1

10.2

47.0

14.1

0.4

0.2

0.9

ROE (%): Result

A=B×C×D

N.P. Margin (N.P. / sales) (%)

B

Total Asset Turnover Ratio (sales / ave. total asset) C
Financial Leverage (ave. total asset / ave. owner's equity)
ROA (R.P. / total asset) (%)

D

E=F×G

R.P. Margin (%): Result
Total Asset Turnover Ratio (sales / ave. total asset)

FG

41,600（Ref) Prepared by Alpha Win Research Department based on financial results summaries and securities reports. Forecasts are company plans.
Italics indicate the company forecasts for FY2024 and the rest are actual results of FY2023.

25/43
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: 6/23/2023

7．Last Fiscal Year’s Results and This Fiscal

Year’s Forecast◆ Results for FY2023 (last fiscal year)
Summary
Full-year consolidated results for FY2023 were as follows: sales ofY12,981 million (-3.0% YoY), operating profit of Y1,288 million (-51.5%
YoY), recurring profit of Y1,326 million (-50.8% YoY), and net profit
attributable to owners of the parent of Y883 million (-62.7% YoY;
hereinafter, "net profit"). Sales slightly declined, while the profits declined
significantly (Figure 20).

w In the previous fiscal year’s

results, sales slightly
declined while profits were
halved.

【Figure 20】Financial Results for FY2023(Unit: million yen, %)Full-Year Results

FY2022

FY2023Difference% Change

FY2023Result - Plan

Result/Plan

FY2023Result-Forecast

Result/Forecast

FY2023

Unit: million yen

Results

Results

YoY: million yen

YoY: %

Company Forecast

Diff: million yen

Diff: %

Alpha-Win's Forecast

Diff: million yen

Diff: %

Initial Company Forecast

13,008
1,391
10.7
808
6.2

-27
-103
-0.8
75
0.6

12,950
8,100
62.5
6,700
51.7
1,400
10.8
800
6.2

31
-49
-0.5
63
0.4
-112
-0.9
83
0.6

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

13,382
8,809
65.8
6,153
46.0
2,655
19.8
2,367
17.7

12,981
8,051
62.0
6,763
52.1
1,288
9.9
883
6.8

-401
-758
-3.8
610
6.1
-1,367-9.9-1,484
-10.9

-3.0
-8.6
9.9
-51.5
-62.7

-0.2
-7.4
9.3

0.2
-0.6
0.9
-8.0
10.4

12,927
7,845
60.7
6,744
52.2
1,100
8.5
639
4.9

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary. The Company’s plan and Alpha-Win’s forecasts are the most recent forecasts.

w Sales came out be about
the same level as theforecast, while theoperating profit fellslightly short.

Comparison with the Forecast
In January 2023, the Company had upwardly revised its initial forecasts
made at the beginning of the fiscal year. The results came out to be slightly
short of these forecasts, excluding net profit. Sales fell short of theCompany’s revised forecast by Y27 million (-0.2% compared to the plan),
operating profit was Y103 million lower (similarly, -7.4%), and recurring
profit was Y100 million lower (similarly, -7.0%). Net profit, on the other
hand, was Y75 million higher (similarly, +9.3%). Compared to the initial
forecasts, both the sales and each of the profits came out to be higher(Figure 20).
Compared to our forecast, which was about the same level as theCompany’s, sales were Y31 million higher (+0.2% compared to ourforecast), but operating profit was Y112 million lower (similarly, -8.0%).
Net profit also exceeded our forecast by Y83 million (similarly, +10.4%),
but this was presumably due to the difference in the estimate for deferredincome taxes.

w There was an event-driven
high demand in FY2022.

w In FY2023, sales of

products fell sharply inreaction to the previous
event-driven high demand,but the other sales
categories compensated forthis decline.

Sales
Factors that increased or decreased sales in FY2023 (previous fiscal year)
are as shown in Figure 21 on page 27.
In FY2022 (the fiscal year before the previous), the Company estimates that
there was a replacement demand (event-driven high demand) of Y1.2
billion in the first half and Y500 million in the second half in response to
the end of support for the X series. This demand greatly contributed to its
business results.
In FY2023, sales of the products declined significantly (-Y1,805 million or-61.1% YoY) in reaction to the event-driven high demand mentioned above.
However, this decline was mostly offset by the sales growth of theremaining four sales categories, resulting in an overall sales decline of only
Y401 million (-3.0% YoY).

26/43
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: 6/23/2023
In FY2022, the Company could not allocate sufficient resources to sales
activities for the solutions business since it needed to respond to the eventdriven high demand for its products. In FY2023, though, sales efforts were
strengthened. As a result, sales of the solutions rose sharply by Y865
million YoY (+78.4% YoY). The cloud service also contributed to the sales
growth, with sales rising by Y388 million (+7.0% YoY).

w Solutions recovered andthe cloud service
continued to grow.

【Figure 21】Each Sales Category’s Impact on Sales in FY2023 (last fiscal year)(Million yen)

14,000

Increase

Decrease

13,382

13,500865

12,981

Solutions andOther

FY202313,00012,500388
12,000138

11

Merchandise

Main tenance-1,161
11,500-1,805

11,000

FY2022

Products

Cloud(Ref) Prepared by Alpha-Win Research Dept. from the financial results materials

Cloud
The number of corporate users of PCA Cloud reached 10,000 on January
11, 2018. The number has then been increasing from 12,070 at the end of
March 2019 to 14,327 at the end of March 2020 (+2,257 YoY), 16,444 atof the end of March 2021 (+2,117 YoY), 19,152 at the end of March 2022(+2,708 YoY; the largest net increase ever), and 21,022 at the end of March2023 (+1,870 YoY) (Figure 22; the eventual goal is to achieve 80,000 users).

w The number of corporate

users of the cloud service
is increasing steadily.

w The number of corporate

In FY2023, the net increase in the number of corporate users fell below
2,000 users, but this seems to have been a reactionary decline from a partof the event-driven high demand for the products in FY2022 that wasreflected in the cloud service as well. The monthly rate of net increase has
not changed in the current fiscal year, remaining at a high level. The
Company hopes to maintain the net growth in the number of corporate users
at about 1,800 to 2,000 companies per year for the meanwhile.

w Sales growth rate of the

The cloud’s sales have been increasing from Y2,452 million in FY2019(+Y598 million or +32.3% YoY) → Y3,374 million in FY2020 (+Y922
million or +37.6% YoY) → Y4,057 million in FY2021 (+Y683 million or+ 20.2%) → Y5,568 million in FY2022 (the fiscal year before the previous;+Y1,511 million or + 37.2%) → Y5,956 million in FY2023 (previous fiscal
year; +Y388 million or + 7.0%).

w Upward trend for the

Since the cloud’s sales include PCA Hub and PCA Subscription, a simple
comparison cannot be made, but the annual sales from each corporate user(= annual sales / average number of corporate users of the PCA Cloud
during the fiscal year) (unit: thousand yen per company per year) have been
increasing during this period.

users increased at a slower
pace than in the past, but ahigh net growth rate has
been maintained.

cloud service decreased in
the previous fiscal year.

average price per corporate
user.

【Figure 22】Change in the Number of Corporate Users of the Cloud Service
and the Sales of the Cloud Service (yearly change)
Fiscal Year

Number of Corporate
Users of the Cloud Service
Unit: companies

Cloud Service's
Sales

Number of Corporate Users(companies)

Unit: million yen% Change(YoY)

Sales (million yen)

Change in
Number (YoY)% Change(YoY)

Amount of
Change (YoY)(Ref) Prepared by Alpha-Win Research Dept.
from the financial results materials

Average Annual Unit
Price

Average Monthly Unit
Price

Thousand yen/
company/year

Thousand yen/
company/month

FY201912,070

2,452

15.0

1,570

32.3

598

217

18

FY202014,327

3,374

18.7

2,257

37.6

922

256

21

FY2021

16,444

4,057

14.8

2,117

20.2

683

264

22

FY2022

19,152

5,568

16.5

2,708

37.2

1,511

313

26

FY202321,022

5,956

9.8

1,870

7.0

388

297

25

7,285

ー

ー

22.3

1,329

ー

ー

FY2024 CE

Not disclosed

27/43
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: 6/23/2023
Subscription-Based Business
The proportion of subscription-based revenue (total sales of themaintenance service + cloud service) to total sales, a key indicator for theCompany, rose from 66.4% in the fiscal year before the previous to 71.5%
in the previous fiscal year (the same order applies hereinafter). This was
because the cloud’s sales increased, while the products’ sales declined.

w The sales proportion of thesubscription businesses
has increased to about 70%.

Also, the balance of contract liabilities (advances received for the cloud andmaintenance services) has increased steadily by Y929 million (+12.6%)
from Y7,364 million at the end of FY2022 to Y8,293 million at the end of
FY2023.

w The balance of contract
liabilities has beenbuilding up steadily.

ProfitFigure 23 shows the factors contributing to the increase or decrease inconsolidated operating profit in the previous fiscal year. The largest factor
that caused profit to decrease was the decline in the products’ sales. Thiswas followed by the increase in the cost of manufacturing (+Y364 million
YoY) due to higher labor costs (+Y170 million) and subcontracting costs(+Y380 million), and then the rise in the cost of the cloud (+Y155 million)
that came with the increase in the sales of the cloud. As a result, the grossmargin worsened by 3.8 percentage points from 65.8% to 62.0%.

w Lower sales of products

and higher costs, including
development expense,
were the main reasons forthe decline in profit. Grossmargin declined by 3.8
percentage points.

w In addition to the decline

in gross margin, the SG&A
expenses ratio increased,
resulting in a decline inoperating margin by about
10 percentage points.

Regarding SG&A expenses, there was an increase in the R&D expense(Y419 million ⇒ Y614 million; about +Y194 million) and the personnel
expense (Y3,287 million ⇒ Y3,533 million; +Y246 million) included in the“other SG&A expenses,” and the sales promotion and advertising expenses
were also increased (+Y180 million) to strengthen sales activities as the
COVID-19 outbreak settled down. These caused profit to decline.
Although the overall sales decline was -3.0% YoY, the SG&A expenses
increased by 9.9% (+Y610 million), causing the SG&A expenses ratio toworsen by 6.1 percentage points from 46.0% to 52.1%. As a result, theoperating margin fell by nearly 10 percentage points from 19.8% to 9.9%.

【Figure 23】Factors that Increased/Decreased Operating Profit in FY2023 (last fiscal year)(Millionyen)

Operating
ProfitCost of Sales

Sales

3,000

Increase

2,655
2,500

Operating
ProfitSG&A Expenses

Decrease

164
-401

2,000

-155
-364

1,500

-180
1,288

-194
-234

1,000

500

0
A
FY2022A
Sales

CostAof cloudA
Cost of purchaseA
Cost of
Manufacturing

A
Sales promotion
and advertisingexpensesA
R&D expenseA
Other SG&A
expensesA
FY2023(Ref) Prepared by Alpha-Win Research Dept. from the financial results materials.

28/43This 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: 6/23/2023
Quarterly Financial Results
Looking at the quarterly performance, the previous fiscal year saw a YOY
decline in sales and profit from Q1 to Q3, but profit was posted for eachquarter (Figure 24). In Q4, however, the Company posted a loss, startingfrom operating loss, despite a 6.5% increase in sales. However, due toadjustments for income taxes, a net profit was maintained in Q4 as well.

w In Q4, sales and profits

declined and SG&A
expenses rose sharply due
to increased development
expense and otherexpenses. An operating
loss was posted.

The gross margin in Q4 fell by 2.2 percentage points YoY from 62.4% to60.2%. The SG&A expenses increased from Y1,926 million to Y2,128
million (+Y202 million or +10.4% YoY), and the SG&A expenses ratiorose by 2.2 percentage points from 59.5% to 61.7%. As a result, theoperating margin in Q4 worsened from +2.8% to -1.5s%.

w Gross margin declined in

Q4, while the SG&A
expenses ratio rose. The
operating margin fell by
about 4 percentage points.

Note that in Q4 FY2022 and Q4 FY2023, the SG&A expenses ratio
increased significantly compared to Q1 through Q3 of both fiscal years, andthe operating margin declined (simple average of the operating margins
from Q1 to Q3 of both fiscal years: 25.3% and 14.0%, respectively). The
main reason is that the Company had strategically increased upfront
investments, such as development expense, in the last quarter of each fiscal
year to prepare for future growth.

w On a quarterly basis, boththe cloud service’s sales
and net increase in its
number of corporate users
are on a recovery trend.

PCA Cloud, the key driver of the Company’s business performance, hasbeen recovering both in terms of the quarterly net increase in the number ofcorporate users and quarterly sales (Figure 25).

【Figure 24】Quarterly Change in Financial Performance in FY2023 (last fiscal year)
FY2022

FY2023Results

Q1

Q2

First Half

Q3

Q4

Second Half

Unit: million yen(Apr-Jun)(Jul-Sep)

Apr-Sep 2021

(Oct-Dec)(Jan-Mar)Oct 2021 - Mar
2022

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 (%)

Q1

Q2First Half

Q3

Q4

Second Half

(Apr-Jun)(Jul-Sep)

Apr-Sep 2022

(Oct-Dec)(Jan-Mar)Oct 2022 - Mar
2023

Full Year

Full Year

3,328

3,281

6,609

3,535

3,238

6,773

13,382

2,954

3,209

6,163

3,370

3,448

6,818

12,981

935

783

1,718

745

491

1,236

2,954

241

316

557

308

284

592

1,149

85

82

167

190

82

272

439

108

114

222

210

145

355

577

820

826

1,646

833

837

1,670

3,316

838

850

1,688

800

839

1,639

3,327

1,255

1,340

2,595

1,449

1,524

2,973

5,568

1,361

1,499

2,860

1,512

1,584

3,096

5,956

231
2,284
68.6
1,309
39.3
975
29.3
987
29.7
614
18.4

250
2,222
67.7
1,444
44.0
778
23.7
795
24.2
835
25.4

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

318
2,284
64.6
1,474
41.7
810
22.9
817
23.1
819
23.2

304
2,019
62.4
1,926
59.5
92
2.8
98
3.0
99
3.1

622
4,303
63.5
3,400
50.2
902
13.3
915
13.5
918
13.6

1,103
8,809
65.8
6,153
46.0
2,655
19.8
2,697
20.2
2,367
17.7

404
1,829
61.9
1,520
51.5
309
10.5
315
10.7
142
4.8

430
2,083
64.9
1,545
48.1
538
16.8
556
17.3
352
11.0

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

541
2,064
61.2
1,570
46.6
493
14.6
501
14.9
330
9.8

594
2,075
60.2
2,128
61.7
-52
-1.5
-46
-1.3
59
1.7

1,135
4,139
60.7
3,698
54.2
441
6.5
455
6.7
389
5.7

1,969
8,051
62.0
6,763
52.1
1,288
9.9
1,326
10.2
883
6.8

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

【Figure 25】Change in the Number of Corporate Users of the Cloud Service and the Sales of the Cloud Service(quarterly change)
QuarterNumber of Corporate Users of
the Cloud Service

Cloud Service's SalesAt the End of Each Month,
Cumulative (unit: companies)

For Each Quarter(unit: million yen)

Quarterly Change in the Number of Corporate Users (companies)% Change(YoY)

Change in Number
(YoY)

14.8

% Change(QoQ)

Quarterly Change in Sales (million yen)

Change in Number(QoQ)% Change(YoY)

Change in Amount(YoY)% Change(QoQ)

Change in Amount(QoQ)

March 2021 (Q4)

16,444

1,076

2,117

―

―

14.0

132

4.3

44

June 2021 (Q1)

⾮公表

1,255

―

―

―

―

31.1

298

16.6

179

September 2021 (Q2)

17,785

1,340

16.5

2,523

―

―

35.1

348

6.8

85

December 2021 (Q3)18,578

1,449

―

―

4.5

793

40.4

417

8.1

109

March 2022 (Q4)

19,152

1,524

16.5

2,708

3.1

574

41.6

448

5.2

75

June 2022 (Q1)

19,441

1,361

―

―

1.5

289

8.4

106

-10.7

-163

September 2022 (Q2)19,853

1,499

11.6

2,068

2.1

412

11.9

159

10.1

138

December 2022 (Q3)

20,466

1,512

10.2

1,888

3.1

613

4.3

63

0.9

13

March 2023 (Q3)

21,033

1,584

9.8

1,881

2.8

567

3.9

60

4.8

72

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

29/43This 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: 6/23/2023◆ PCA’s Financial Forecast for FY2024 (this fiscal year)
Summary of the Full-Year Forecast
The Company announced its full-year forecasts for FY2024 (the current
fiscal year). It expects double-digit growths in sales and operating profit,with sales of Y14,700 million (+13.2% YoY), operating profit of Y1,445
million (+12.2% YoY), recurring profit of Y1,478 million (+11.4% YoY),
and net profit of Y925 million (+4.8% YoY) (Figure 26).

w Expecting double-digit

growths in sales andoperating profit this fiscal
year.

In addition, to achieve the final profit goal, the Company may either
promote or suppress expenditure depending on changes in the internal andexternal conditions. Since this makes prediction difficult, the Company has
again not announced its consolidated financial forecast for this fiscal year’s
first half.

w First-half forecasts notdisclosed.

【Figure 26】Financial Forecast for This Fiscal Year (the Company’s plan and Alpha-Win’s forecasts)
Consolidated(unit: million yen)
Sales
Products
Merchandise

Sales byCategory

FY2024: Company Forecast

FY2023
New RevenueRecognition Standard

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

12,981
1,149
577
3,327
5,956
1,969
8,051
62.0%
6,763
52.1%
1,288
9.9%
1,326
10.2%

New RevenueYoY: Diff. in amount
Recognition Standard/ Diff.

14,700
1,403
547
3,359
7,282
2,107
8,797
59.8%
7,351
50.0%
1,445
9.8%
1,478
10.1%

FY2024: Alpha-Win's New Forecast

YoY: % change

1,719
254
-30
32
1,326
138
746
-2.2%
588
-2.1%
157
-0.1%
152
-0.2%

13.2%
22.1%
-5.2%
1.0%
22.3%
7.0%
9.3%

4.8%

Net Profit Attributable to Owners of the
Parent

883

925

42

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

6.8%
17.0

6.3%
17.0

-0.5%
0.0

8.7%
12.2%
11.4%

New Revenue-Recognition YoY: Diff. in amountStandard/ Diff.

14,700
1,450
540
3,360
7,200
2,150
9,000
61.2%
7,550
51.4%
1,450
9.9%
1,480
10.1%

YoY: % change

1,719
301
-37
33
1,244
181
949
-0.8%
787
-0.7%
162
-0.1%
154
-0.1%

13.2%
26.2%
-6.4%
1.0%
20.9%
9.2%
11.8%

925

42

4.8%

6.3%
17.0

-0.5%

11.6%
12.6%
11.6%

(Ref) Prepared by Alpha-Win Research Dept.

w Overall price revision
planned.

w With no more reactionary

decline from the previous
event-driven high demand
for the products and with
continued growth of thecloud and solutions, thesales of the products are
expected to recover.

Summary of the Full-Year Forecast (Sales)
For the current fiscal year, the Company expects overall sales to grow by
Y1,719 million YoY (+13.2%) due to an increase in the cloud service’s
sales, the overall price revision for the products and services (scheduled forJuly; rate of price increase not disclosed), and sales of the Hub series.
By sales category, the cloud service is expected to account for 77% of theoverall amount of sales growth, at a sales growth of Y1,326 million(+22.3% YoY). With no longer a reactionary decline from the event-driven
high demand like the previous fiscal year, this will be followed by the
products’ sales which are expected to increase by Y254 million (+22.1%
YoY) and the solutions’ sales which are expected to rise by Y138 million(+7.0% YoY), each contributing to 15% or 8% of the overall sales growth(Figure 27 on page 31). As a result, the sales proportion of the subscription
businesses is planned to rise to 72.4%.
In addition, due to structural changes, the Company plans a 5.3% sales
decline for the merchandise (paperless operations and digitalization) and aslight 1.0% increase in sales for maintenance (shift to the cloud).

30/43This 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: 6/23/2023【Figure 27】Change in Sales and This Fiscal Year’s Forecasted Sales Breakdown by Category (unit: million yen, %)Cloud

Maintenance

Solutions

Merchandise

Products

New AccountingStandard

Previous AccountingStandard(Million yen)

16,00015,213

12,00011,436552
10,000

9,358
8,438

8,000

6,000

2,069

1,767

854
1,639

955
1,740

9,783

2,516

1,954

563

988

3,026

1,985

439

2,954

2,713

439

485

12,981
1,149

577

3,518

3,316

547

94.7％

2,107

107.0％

3,359

101.0％

3,109

1,152

1,496

1,854

3,124

FY2016FY2017FY2018FY2019

7,282

3,374

FY2020

72.4%

3,327

3,552

2,452

27.6%

1,969

1,103

3,227

122.1％

3,471

2,000

0

2,975

2,781

1,878

4,000
3,098

3,701

13,306113.2％

1,403

SubscriptionBased-Revenue

3,166

13,382% of Total

One-Time-PaymentBased Revenue

14,70014,26414,000

YoY
Comparison

5,568

5,568

5,956

FY2022

FY2022

FY2023 FY2024 CE

122.3％

4,057

FY2021(Ref) Modified and prepared by Alpha-Win Research Dept. based on the financial results briefing and financial results summary (partially edited
the YoY comparison). Sales forecasts (amount; CE) are the amounts forecasted by the Company.
(Note) Since the accounting standard for the posting of sales as merchandise or solutions had been partially changed in FY2020, adjustments wereretroactively made for FY2019 according to the new standard. However, for the two categories, there is no continuity with the years before
FY2019. Also, starting in FY2022, the new revenue-recognition standard, etc., have been applied, and the Company has been announcing
its sales forecast based on both the previous and the new standard. “% of Total” is based on the Company’s forecast for FY2024.

Summary of the Full-Year Forecast (Profit)
Figure 28 on page 32 shows the factors that are expected to increase or
decrease consolidated operating profit (YoY) in the current fiscal year.
w Forecasting an increase inprofit, since the sales
growth is expected toabsorb the upfront
investment costs, including
investment in new productdevelopment.

To strengthen development of products such as the PCA Hub series for the
next stage of growth, there will be increases in the cost of sales (+Y180
million YoY for labor costs and +Y660 million YoY for subcontracting
costs), the R&D expense (+Y285 million YoY), and other SG&A expenses(+Y332 million YoY, including system usage fees and rent expense).
However, the Company expects the increase in sales (+Y1,719 million) toabsorb all of these costs, resulting in an increase in profit.

w Gross margin and SG&A

The gross margin is planned to worsen by 2.2 percentage points from 62.0%
to 59.8%, in the order of the previous fiscal year to the current fiscal year(the same order applies below). However, since the rate of increase in the
SG&A expenses will be kept at +8.7% YoY, which is lower than the rateof sales growth (+13.2%), the SG&A expenses ratio is expected to decreaseby 2.1 percentage points from 52.1% to 50.0%.

w Due upfront investment

As a result, the operating margin is expected to decrease by only 0.1
percentage point from 9.9% to 9.8%. Although the Company’s businessmodel has a high marginal profit ratio, it expects the sales growth rate andthe profit growth rate to be about the same level this fiscal year due toupfront investment costs.

expenses ratio are both
expected to decline, while
the operating margin willremain mostly flat.

costs, the profit growth rateis expected to be about thesame as the sales growthrate.

No major non-operating or extraordinary income/losses are expected thisfiscal year either.

31/43
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: 6/23/2023【Figure 28】Factors that Are Expected to Increase/Decrease Operating
Profit in FY2024 (this fiscal year) (the Company’s plan)(Million yen)

4,000

OperatingprofitSales

Cost of sales

3,500

OperatingprofitSG&A expenses

Increase

Decrease

1,719
3,000

-188

2,500

-45
28

2,000

-740
-285

1,500

1,288

-332

1,445

1,000
500
0
FY2023AResult

Sales
A

Cost ofA cloud

CostAofpurchase

Cost
A of
Manufacturing

R&D expense
Sales
A
A
promotion andadvertisingexpenses

Other
A SG&A FY2024AForecast
expenses

Prepared by Alpha-Win Research Dept. based on the financial results materials.

◆ Alpha-Win Research Dept.’s Financial Forecast for
FY2024 (this fiscal year)
Summary
We reviewed our forecast for the current fiscal year, taking into account theprevious fiscal year’s results, the Company’s plan for the current fiscal year,
and the current situation (Figure 26 on page 30).
We revised our sales forecast upward from Y14,310 million in our previous
forecast (February 2023 report) to Y14,700 million, which is the same as
the Company’s plan. Meanwhile, we also revised our profit forecasts
downward to the same levels as the Company’s plan.
Regarding profit, we lowered our profit margin forecast due to high levelsof continued upfront investment in development and recruitment, as well as
the greater-than-expected rise in cost due to inflation. We believe that thesales and profit margins in the Company’s plan are generally reasonable
and could be achieved through the upward price revision and cost control.
The Company’s estimates for the cloud business’ amount of sales growthand sales growth rate are high, but they presumably reflect the effects of the
upward price revision and the sales growth of the PCA Hub series (sales
expansion of the current products and release of new products) and PCA
Subscription.

w The risk factor is theimpact of the deteriorating
macroeconomy oncorporate earnings and IT
investment interests.

w Since the Company ismainly focused onsubscription businesses
and benefits fromdigitalization and workstyle reforms, the risks arelimited.

Risk Factors and Factors that May Cause Change
The main risk factor in the medium-term financial forecast including thisfiscal year is that the corporate users’ business performance and IT
investment interests may worsen due to the stagnation of economic
activities in response to the rebound and prolongation of COVID-19, theinflation and logistics disruption caused by the Russian invasion of Ukraine,
the global economic downturn, and revisions to Japan’s loose monetary
policy. These may cause the corporate users to refrain from purchasing
products and services or postpone their implementation.
However, the conventional services of the Company’s group are centeredon stable subcription businesses and the Company’s businesses andoperations also have a high affinity with remote work and working fromhome. They also benefit from the digitization and work-style reforms of

32/43
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: 6/23/2023
companies and the society. In the current fiscal year, the Japanesecompanies’ financial performance is expected to remain strong, especiallyin the second half, and risks due to macroeconomic factors are expected tobe limited.

w Increasing costs,

intensifying competition,and slower growth rate of
the cloud service are risk
factors.

w Monetization of the new
businesses will be thechallenge.

w Key points are whether

there will be an eventdriven high demandduring this fiscal year, andalso M&As in the medium
to long term.

Other risks include increases in costs due to rising labor costs, personnel
expense, and subcontracting costs, as well as a slower growth rate of thecloud business due to intensifying competition with competitors.
In addition, although presumably not included as a large part of the budget,
progress may not be made as expected regarding the new services such as
PCA Hub, PCA Subscription, the healthcare business, and hyper in terms
of providing these service, acquiring new customers, and promoting theirsales. Monetization of these new businesses will be the challenge. In
particular, Dreamhop seems to be continuing to post a net loss, which isperhaps even worsening, and drastic business transformation will be needed.
Other factors that may impact the Company’s results include the new
invoicing system (October 2023) and the revision of the Electronic Books
Preservation Act (January 2024). Currently, the Company is not
anticipating any large, event-driven high demand, but demand may change
significantly within a short time span before and after the introduction of
new regulations. Their impact on sales and profit (especially on the upside)should be closely watched.
In addition, if a new M&A is conducted, whether it succeeds or not will
impact business performance.

33/43
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: 6/23/2023

8． Growth Strategy◆ Medium- to Long-Term Vision and PolicyLong-Term Vision
The PCA Group’s long-term vision through FY2031, 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 management-support
business for our corporate customers.”

w Long-term vision is tobecome a “Management
Support Company”
focused on the
management-support
business for its corporate
customers.

New Medium-Term Management Plan
The Company has been creating medium-term management plans for threeyear spans and has announced a new medium-term management plan
(FY2023 to FY2025) that started last fiscal year. Its medium-term basic
policy is to “transform the business structure and build the foundation forcontinuing and developing stable businesses over the long term” and aims
to “optimize the company’s structure for creating customer-oriented new
businesses, products, and services ahead of changes in the society.”w Created a new medium-

term plan. For sustainablegrowth, it will strengthen
its development capacity,
build its businessfoundation, and transform
its business structure.

To provide total solution services centered on software, it has set fourpriority measures as shown in Figure 29 (items I through IV). Their
execution status is listed in the right-hand column.

w Will execute the fourpriority measures.

【Figure 29】Growth Strategy and Priority Measures of the New Medium-Term Plan, Including Their Progress
Themes of the Medium-Term Management Plan
(FY2023 - FY2025)
I. Establish a strong revenue base for the corebusinesses

1. Further expand the cloud business withenhancement and expansion of PCA Cloud
2. Accelerate the shift toward thesubscription-based business model

Priority Strategies
Further Strengthen PCA's Earning Power throughContinous GrowthWith a focus on PCA Cloud / on AWS, capture demand
related to new ways of working such as remote work withflexiblity.

・Working on gaining new customers by shifting the existing customers to the cloud and focusing on digital marketing. In thefirst half, there was a reactionary drop from the previous high demand related to the end of support for the X series, but thedemand recovered in the second half.

・Recommending subscription and cloud versions for new projects and to existing customers replacing their products. To
With a focus on PCA Subscription, switch from sales of thecustomers who have not yet subscribed to the maintenance plan, suggestions are made as to how it will be helpful for the
packaged, on-premises products to the subscription services.
upcoming new invoicing system.
Effectively meet the direct needs of customers and pursue

3.Enhance customer success with digital tools greater customer success to raise subscription rate andcustomer retention rate.

II. Create new business opportunities

Current Progress・Strengthened engagement with potential customers who accessed PCA's website from channels such as digital ads. As a result,greater lead acquisition was achieved, trial usage increased, and more new customers were gained compared to the previous fiscal
year.

・Applied research including AI: In November 2022, a new option for PCA Hub eDOC was released - an automatic journal entry
For Developing the Next Core Busineesses and the Future service using an AI-OCR module. Also looking into more applications in making entries other than reading images.
Applied research of fundamental technologies including AI
・Finding and creating new areas of business: Continuing to work on finding and creating new areas of business, looking into(enabling linkage between core business operations andpossibilities such as finding partners for product alliances, forming business alliances, and conducting M&As. Althoughperipheral operations and automating data entry), finding
and creating new areas of business (materialize ideas, seeds, significant progress has not been achieved yet, these activities are planned to be continued.
and customer needs), and launching the PCA Hub services
・Launching the PCA Hub services: Released the new services PCA Hub Pay Slip and PCA Hub Invoice as planned in March(meeting DX needs and developing as a new revenue source) 2023. During FY2023, the next new services were investigated and a budget has been secured, which have been reflected in thedevelopment plan for FY2024.

・Digital (Electronic Books Preservation Act): Acquired the JIIMA certification for the PCA Accounting series in Jan. 2022, forGain Greater Competitive Edge and Differentiate through the PCA Shokon/Shokan series in Nov. 2022, and for PCA Hub eDOC in Jan. 2023. They can now be used while meeting law
requirements such as the Electronic Books Preservation Act. Planning to also acquire the certification for the fixed asset software
Modernized Software Development
and other services.
III. Strengthen monozukuri (creation of things) Digital (support DX of operations), Service (quick service
with a focus on safety, security, and anticipation development and release from a user-oriented approach),・Service (service development / agile):Working on shortening the overall service development process through the integrationof needs
and Modern (strengthen development system, expand theof development and testing, conducting testing from early stages in the process. Also started applying this method to the service
PCA Hub series, and modernize in the area of enterprisedevelopment for the Hub series.
systems).
・Modern (browser-based): Working on further strengthening the development system to expand the service platform tobrowsers, not just the current focus on the Windows platform.

IV. Strengthen the management foundation
toward a high-profit structure

For Sustainable Growth
Build and leverage the foundation for DX acceleration,
strengthen IT governance and security, and build a systemthat enables active engagement by a diverse workforce.

・Build and leverage the foundation for DX acceleration: In October 2022, a transitionwas made to a new customer management
system. Information on potential customers and distribution channels can now be shared under a single system. This new system
will be used to improve the acquisition of new customers and reduce customer churn for the existing customers.
・IT governance and security: Updated and strengthened the rules for IT systems and security. Providing security training widely
across the PCA Group’s companies, including employees, part-time staff, and temporary staff.
・Build a system that enables active participation by a diverse workforce: As part of the measures to prevent the spread of
COVID-19, the working environment and system has been prepared to facilitate remote work.

(Ref) Based on the financial results briefing materials, partially edited by Alpha-Win Research Dept. with supplementary information.

34/43
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 main points are tostrengthen thesubscription-based
business model, respond todigitalization needs, createbusiness opportunities,
and strengthen its
development and service
system as well as
management foundation.

(16） DX: Stands for Digital
Transformation. The changes inlifestyles and businesses brought
about by digital technologies.

w As numerical goals of themedium-term plan, seven
items have been set fromthe perspectives ofbusiness performance,
capital efficiency, andshareholder return.

w Currently, the sales-related
targets seem achievable,
but the profit-related
targets are high hurdles.

Issued: 6/23/2023
The priority measures have basically been developed based on the previous
medium-term plan. By first strengthening the subscription-based businessmodel centered on the cloud business, and then strengthening thedevelopment and service structure, the Company plans to support the DX16of the operations of small/medium-sized companies.
In addition, it plans to work on its own DX and strengthen its managementfoundation such as governance and structure to achieve sustainable growth.

◆ Management Indicators Set as Goals
Numerical Goals of the New Medium-Term Plan
The seven items below have been set as the numerical targets for the current
medium-term management plan (the goals for the final year are for FY2025
or the next fiscal year) from the perspectives of business performance,
capital efficiency, and shareholder return (Figure 30). There have so far
been no changes to the targets.
Aside from the two items related to sales, all figures have already beenachieved in the past, such as during periods of event-driven high demand.
Therefore, they seemed at first to be realistically achievable targets.
However, a comparison of this fiscal year’s forecast with the goals of the
final fiscal year of the plan (next fiscal year) shows a large discrepancy,with the exception of sales and dividend payout ratio. Realistically,
achieving the targeted consolidated operating profit, ROE, and DOE will
especially be a challenge.

【Figure 30】Progress with the Goals of the Medium-Term Management Plan and Their Outlook
Goals of the Current Medium-Term Management Plan
(FY2022 - FY2025)
・Consolidated Sales

Business
Performance

Asset Efficiency
Shareholder Return

Of which, sales from the subscription
businesses (maintenance & cloud)・Consolidated Operating Profit

FY2025: Company Plan

FY2024: Company Plan

Record HighY15 billion or more

Y14.7 billion

Y14.27 billion (FY2020)

Y9.5 billion or more

Y10.64 billion

Y9.28 billion (FY2023)

Y2.5 billion or more

Y1.45 billion

Y2.78 billion (FY2020)・Consolidated Operating Margin

16% or more

9.8%

During the past 10 years: 19.8% (FY2022)
During the longest period with data available:
28.5% (FY1999)

・ROE

10% or more

5.2% (Alpha-Win's estimate)

14.4% (FY2022)

・DOE

2.5%

1.9% (Alpha-Win's estimate)・Dividend Payout Ratio

30.0%

36.7%

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials. The plan was announced by the Company.
(Note) Values have been rounded to the nearest unit.

w We reviewed our mediumterm financial forecasts.

w 当調査部では、中期の年間利益成長率を 5~8％予想。
w Economic activities are
assumed to return tonormal starting this fiscal
year.

◆ Alpha-Win Research Dept.’s Forecast of Medium-Term
Financial Results
We newly added a forecast for the fiscal year after the next (FY2026) andprepared a medium-term forecast for the three fiscal years including thecurrent fiscal year (Figure 31 on page 37). For the current and the next fiscal
year’s forecasts, we revised our previous profit forecasts downward.

Macroeconomic Assumptions
The outllook of the macroeconomic environment is currently uncertain due
to factors such as the depreciation of the yen, inflation due to soaring
resource prices, and disruption of logistics. However, since the COVID-19
risk in Japan is becoming smaller, we predicted that people’s lives,
economic activities, corporate earnings, and IT investments by
35/43

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: 6/23/2023
small/medium-sized companies will gradually return to normal andimprove. At present, we do not anticipate any occurrence of high demand
related to tax systems, accounting standards, and product versions.

w Reconsidered the estimates
for the sales of each sales
category and the costs.

w We expect the operating
margin to gradually
improve YoY.

w The cloud and work
management software willcontinue to be the growth
drivers.

Estimates Used for Sales, Expenses, and Profit
We reviewed our estimates for costs and sales by category, especially forthe products, cloud, and other. We continue to predict that themerchandise’s sales will decline as more companies go paperless and thatthe sales of maintenance service will also continue to drop due to the shift
to the cloud.
However, we predict that due to the increase in the cloud’s sales (growth ofabout 15-20% per year), the improvement of the product mix with theincreasing proportion of the cloud, the transition of various businesses tothe subscription-based business model, and the streamlining of business,the results could be controlled to some extent so that the SG&A expenses
ratio will somewhat decline and the operating margin will gradually rise.
Consequently, we expect profit to increase mainly due to sales growth.
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 investments, sales promotion expense,and personnel expense and contributing to the increase in sales and profits.
In addition, as the COVID-19 crisis settles down, the Company should be
able to start providing on-site support to its customers and conduct inperson sales like before.
Also, if the Company could put its current new businesses on track (themental health business, PCA Subscription, and Hyper that it is strugglingwith) and monetize them, they should be able to more solidly support thesales and profit growth trend.

w We revised downward ourforecast for the next fiscal
year.

Forecast for the Next Fiscal Year (FY2025)
For the next fiscal year, we maintained our sales forecast at Y15,520 million,
while we revised downward the forecast for operating profit from Y2,550
million → Y1,550 million, recurring profit from Y1,890 million → Y1,570
million, and net profit from Y1,130 million → Y980 million compared toour previous forecast.

w The upward price revision
is expected to fully
contribute to the results,
but the costs will remainhigh.

We expect sales to grow steadily for the cloud, products, and solutions, withthe upward price revision contributing fully to the results (will only
contribute for about nine months during this fiscal year since the revision
is scheduled for July). However, since the high level of upfront investment
and the cost rise caused by inflation may continue into the next fiscal year,
we reflected these in the financial forecast.

w We expect that theCompany will increase
dividend in the next fiscal
year as well in response tohigher sales and profits.

While we revised the next fiscal year’s forecasts downward, we still expect
continued growths in sales and profit, with a 5.6% increase in sales and a
6.9% increase in operating profit compared to our new forecast for FY2024.
Also, we predict that the dividend per share will be 18 yen, increasing by 1
yen compared to this fiscal year’s forecast.

w Our forecasts are below thetargets of the medium-term
management plan.

Compared to the Company’s goal of the medium-term management plan toachieve sales of Y15,000 million, our forecast is Y520 million higher, but
our operating profit forecast is Y950 million lower than the Company’s
goal of Y2,500 million. The Company would need an event-driven highdemand or need to drastically cut costs in order to achieve its profit targets.

36/43
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: 6/23/2023

Forecast for the Fiscal Year after the Next (FY2026)
We added a new forecast for the fiscal year after the next or FY2026. We
predict sales to be Y16,500 million, growing by 6.3% YoY. Operating
profit is expected to be Y1,650 million and net profit is expected to be
Y1,040 million, both growing by about 6%. We also predict that dividend
per share will be 19 yen, which is 1 yen higher than in FY2025.

w We expect increases insales, profits, and dividendin the fiscal year after the
next, too.

continued growth ofbusinesses such as thecloud will lead to a sales
and profit growth trend.

Forecasted Profit Growth Rate over the Medium/Long Term
Since the cloud business (subscription business), which is the Company’s
core business as well as its growth driver, is based on a subscription modelwith a high marginal profit ratio, its sales growth is expected to directly
contribute to profit growth, with the profit growth rate exceeding the sales
growth rate.

w Revised downward ourforecast for the mediumterm profit growth rate.
Rising costs and delays inmonetizing the new
products/services havebeen reflected in thefinancial forecasts.

Over the medium term (two to three years starting this fiscal year), we had
expected that there will be a double-digit profit growth, supported by thesales growth of the cloud. However, we have revised our forecast to a 5-8%
growth since the level and span of upfront investments for the next phaseof growth, as well as the rise in general costs due to inflation, have been
greater than expected. Also, there have been delays in the contribution of
the new businesses to profit.

w With the subscription
business as the growth
driver, we expect theannual profit growth rateover the long term to be 810%.

We have not changed our forecast that over the long term, upfront
investments will settle down and the subscription business will drive
growth so that the annual sales growth rate will be around 6-8% and the net
profit growth rate will be even greater (8-10% per year), based on
normalized figures excluding the effects of event-driven high demand.
Going forward, the Company’s growth rate will most likely be impacted by
the creation and development of new growth businesses that will contributeto its earnings.

w We expect that the【Figure 31】Medium-Term Financial Forecast
Units: million yen, %Sales

Category

FY2022

FY2023

FY2024: CE

FY2024: New E

FY2025: New E

FY2026: New E

FY2025 CE
Medium-Term Plan
15,00013,382

12,981

14,70014,70015,52016,500

FY2023: Old E

FY2024: Old E

FY2025: Old E

12,95014,31015,5201,500

Products

2,954

1,149

1,403

1,450

1,500

1,600

1,300

1,450

Merchandise

439

577

547

540

530

520

400

360

320

Maintenance Service

3,316

3,327

3,359

3,360

3,370

3,380

3,250

3,150

3,000

Cloud Service

5,568

5,956

7,282

7,200

8,100

9,100

6,200

7,400

8,700

Other Operating Revenue

1,103

1,969

2,107

2,150

2,020

1,900

1,800

1,950

2,000

8,808

8,051

8,797

9,000

9,600

10,100

8,100

8,870

9,700

62.0%

59.8%

61.2%

61.9%

61.2%

62.5%

62.0%

62.5%

Gross Profit

9,500

Gross Margin(ratio to sales)

65.8%
6,153

6,763

7,351

7,550

8,050

8,450

6,700

7,000

7,150

SG&A Expenses Ratio(ratio to sales)

46.0%

52.1%

50.0%

51.4%

51.9%

51.2%

51.7%

48.9%

46.1%

2,655

1,288

1,445

1,450

1,550

1,650

2,500

1,400

1,870

2,550

Operating Margin(ratio to sales)(ratio to sales)

Net Margin(ratio to sales)

9.9%
1,326
10.2%
883
6.8%

9.8%
1,478
10.1%
925
6.3%

9.9%
1,480
10.1%
925
6.3%

10.0%
1,570
10.1%
980
6.3%

10.0%
1,670
10.1%
1,040
6.3%

16.7%

Recurring Margin

19.8%
2,697
20.2%
2,367
17.7%

10.8%
1,420
11.0%
800
6.2%

13.1%
1,890
13.2%
1,130
7.9%

16.4%
2,570
16.6%
1,550
10.0%

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

-3.0%
-61.1%
31.4%
0.3%
7.0%
78.5%
-3.8%
9.9%
13.3%
-51.5%-50.0%

13.2%
22.1%
-5.2%
1.0%
22.3%
7.0%
-2.2%
8.7%
12.2%
11.4%
4.8%

13.2%
26.2%
-6.4%
1.0%
20.9%
9.2%
-0.8%
11.6%
12.6%
11.6%
4.8%

5.6%
3.4%
-1.9%
0.3%
12.5%
-6.0%
0.6%
6.6%
6.9%
6.1%
5.9%

6.3%
6.7%
-1.9%
0.3%
12.3%
-5.9%
-0.6%
5.0%
6.5%
6.4%
6.1%

-3.2%
-56.0%
-8.9%
-2.0%
11.4%
63.2%
-3.3%
8.9%
-47.3%-47.3%-66.2%

10.5%
11.5%-10.0%
-3.1%
19.4%
8.3%
-0.5%
4.5%
33.6%
33.1%
41.3%

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

SG&A Expenses

Operating Profit
Recurring Profit
Net Profit
Sales (YoY growth rate)
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)

16.0%(Ref) Prepared by Alpha-Win Research Dept. CE is the Company’s forecast/estimate. E is Alpha-Win’s forecast/estimate.

37/43This 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: 6/23/2023

9． Analyst’s View
◆ PCA’s Strengths and Challenges
The Company’s SWOT analysis has been updated and the results are listed
in Figure 32.
【Figure 32】SWOT Analysis
・ Brand recognition and credibility 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 stably generating revenue (became a cash-cow business)

Strength・ Strong and diversified customer base (240,000 corporate users in total)
・Taking a lead with the cloud (top-level company for enterprise system software business targeting small/medium-sized companies; expertise; more than 21,000 corporate usersof the PCA Cloud)・High barrier to market entry
・Very experienced call center staff and engineers (support capability)
・Rich product lineup with track record; capacity to provide and develop products and services both as on-premises and by cloud・ Sales capability: sales network with sales offices throughout Japan (13 offices) and 2,000 partnered companies
・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.)

Weakness・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 due to labor shoratage and the neeed to streamline operation (for business software in general); work-style reform (work management system)
・Potential to develop and increase the market penetration of the cloud service (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 Preservation Act, invoicing system, changes in Windows OS, changes in consumption
tax rate, 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; new companies entering the market in the low pricerange)

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 subcontracting, personnel, and development costs(Ref) Prepared by Alpha-Win Research Dep. Words in red indicate additions or revision made in this Report.

w Credibility and trackrecord built over many
years, customer base,expertise in technology,
ample cash & deposits, andfirm financial base 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.

Describing the strengths in more detail, the Company’s brand, products,
and services are well known thanks to its long years of service andcredibility. It is especially strong in certain areas of business (such asaccounting software for small/medium-sized companies). Its customers
also have high loyalty toward products and services, as there is little
incentive to frequently change the enterprise system software. Additionally,
the Company has developed a subscription-based business model that is
highly maintainable and stable, providing maintenance support, cloudservices, and version upgrades. It is leading the market with the cloudservices, which have a high growth potential, and its competitive edge andtop-level achievements are its strengths. Also, it has a solid financial basewith no debt and abundant cash & deposits exceeding the annual sales.
These are enhancing the stability, reliability, and flexibility of management.

w Development of the next

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 would create enough scale advantage.
Regarding companies that have joined the group through M&As, it failed
to create synergies with MACS System Corporation and Keepdata Ltd. andended up selling them, while Xronos has been a successful exception.

w Business volatility

As for the opportunities and weaknesses (or threat), we have seen in thepast that the volatility of financial performance tends to increase before andafter periods of high demand caused by events such as the consumption tax
revision, the work-style reform, end of Windows support, termination of
support for the old product series, and upgrades (the revised Electronicpillars of new
products/services is thechallenge.

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

38/43
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: 6/23/2023
Books Preservation Act and the new invoicing system coming into effectthis fiscal year are not expected to have as much of an impact as an eventdriven high demand).
In 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.

w Aiming for non-pricecompetition. 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 and thedividend payout ratio.

w Stable payment ofdividend is its basic policy.

Dividend History
For many years after its stock became listed, the ordinary dividend had
stayed fixed with no increase or decrease. Since FY2020, though, theCompany has generally been gradually increasing its ordinary dividend andhas also paid commemorative dividends (Figure 33).

w No decrease in ordinary

dividend in the past. Has
been increasing dividendin recent years.

【Figure 33】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

250.0
200.0

18.0

116.9

150.0

13.3

0.0

15.0

6.7

132.0

13.0
10.0

10.0

30.9

47.8

FY2009FY2010

10.3

10.3

10.3

47.2
FY2011FY2012FY2013

10.3

10.3

10.3

46.5

ＮＡ

ＮＡ

FY2014FY2015FY2016

10.3

10.3
48.2

FY2017

20.0

11.0

3.3

100.0
50.0

25.0

24.0

FY2018

10.3

11.3

11.3

19.8

13.6

20.3

FY2020

FY2021

FY2022

17.0

17.0

18.0

19.0

10.0

38.5

36.8

36.7

36.5

FY2023

FY2024(E)

FY2025(E)

FY2026(E)

23.3
FY20195.0
0.0(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary.
(Note) Retroactively adjusted for the 3-for-1 stock split on October 1, 2021. Estimates/forecasts (E) were made by Alpha-Win.

w Dividend increased in the

Since FY2011, the Company had been paying an annual ordinary dividendof 10.3 yen per share (retroactively adjusted for the stock split; the same
applies hereinafter), excluding the commemorative dividend, but in
FY2021 it increased the dividend by 1 yen to 11.3 yen per share. It thenraised the dividend consecutively to 13.0 yen (+1.7 yen) in FY2022 and to
17.0 yen (+4.0 yen) in FY2023. For the current fiscal year, the Company
plans to continue to pay a dividend of Y17.0, the same as the previous fiscal
year. During this period, the Company also paid commemorative dividends
three times.

w The target dividend payout

The target dividend payout ratio is 30%, but the actual ratio was 13.6% in
FY2021 and 20.3% in FY2022, both below the target. However, the ratio
exceeded the target at 38.5% in FY2023 because the ordinary dividend wasincreased, although the EPS had declined. For the current fiscal year, too,previous fiscal year
(ordinary dividend) andwill continue to be 17
yen/share per year in thecurrent fiscal year.

ratio of 30% is expected to
be exceeded this fiscal year.

39/43
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: 6/23/2023
the Company expects to continue to pay an ordinary dividend of 17 yen per
share at a dividend payout ratio of 36.7% (based on the Company’s
forecasts). Based on a stock price of Y1,367 (closing price on June 23,2023), this fiscal year’s dividend yield is estimated to be about 1.2%.

w The goal for dividend on

equity (DOE) is 2.5% but
this fiscal year’s DOE is
expected to fall below thistarget.

Dividend on equity (DOE), which is one of the Company’s KPIs (keyperformance indicators), was 2.9% in FY2022, exceeding the target of 2.5%.
However, in FY2023, the DOE was 2.0%. This fiscal year, too, the DOE is
expected to fall below the target at around 1.9% based on our estimate.
Since profits are impacted greatly by whether there is an event-driven highdemand, the dividend payout ratio and the DOE also tend to fluctuate.
However, the Company has been generally increasing its ordinary dividendand plans for a greater return of profit to its shareholders.

w Plans for greater return ofprofit to shareholders.

w The actual annual net yield
including the shareholder
benefit program is about
1.7% (at maximum).

Dividend Yield
As one of the ways of returning profit to its shareholders, 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 lessthan 900 shares are granted Y2,000 worth of Quo Card. Based on a stock
price of Y1,367, the actual annual net yield for a shareholder owning 300
shares is about 1.7% (at maximum) including the ordinary dividend of Y17
and the shareholder benefit program (Figure 34).
Based on the same conditions, the actual annual net yield of its twocompetitors is about 1.9% for OBC (4733: Obic Business Consultants)(including its shareholder benefit program) and about 2.9% for MJS (9928:
Miroku Jyoho Service) (only dividend yield since it has no shareholder
benefit program).

【Figure 34】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

900

1500

(less than)

1,500

Dividend: Y

Net Yield (maximum): %

17

1.73

3,000

17

1.49

4,000

17

1.44

(Ref) Prepared by Alpha-Win Research Dept.
(Note) Actual dividend yield = (Dividend + Shareholder benefit program’s value) / Stock price; calculated based on the minimum number ofshares owned for each range.
Share price: 1,367 yen (closing price on June 23, 2023)

w Stock split in 2021 andstock cancellation in 2022.

純w 目標配当性向は 33％、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。

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) in October 1, 2021.
Stock Cancellation
In December 2022, the Company cancelled 1,100 thousand shares (4.8% of
the total number of outstanding shares before the cancellation) out ofapprox. 3,001 thousand shares held as treasury shares. As a result of thiscancellation, the Company’s total number of outstanding shares decreased
to 22,000 thousand shares, and the Company now owns 2,001 thousand
shares as treasury shares (9.1% of the total number of outstanding shares).
40/43

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: 6/23/2023◆ Stock Price and Factors that May Affect Stock Price
Performance
The Company’s stock price and relative stock price compared to the
TOPIX over the past approximately seven years are described in thesummary section (Figure C on page 4). Its stock price has risen by approx.
3.7x during this period, significantly outperforming the TOPIX which had
meanwhile only increased by 1.7x.

w With solid financial

performance, stock pricehas increased largely andhas been significantly
outperforming the TOPIX
over the past
approximately seven years.

Also, over the approximately seven years since May 2016, the Company’s
stock performance has been the strongest among the three competingcompanies (the Company and its two competitors [4733 Obic Business
Consultants or OBC and 9928 Miroku Jyoho Service or MJS]) (Figure 35).
w Outperforming its

competitors and TOPIX in
the last two months
following the financial
results announcement.

However, since the beginning of this year, it has been underperforming
OBC and the TOPIX. After the announcement of this fiscal year’s financial
forecast, though, it has been outperforming its two competitors and the
TOPIX (for the last two months or so).
【Figure 35】Comparison of Stock Performance with Competitors
400%

PCA (9629)

OBC (4733)

MJS (9928)

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

Jun 2023

Apr 2023

Feb 2023

Oct 2022

Dec 2022

Jun 2022

Aug 2022

Apr 2022

Oct 2021

Feb 2022

Dec 2021

Jun 2021

Aug 2021

Apr 2021

Oct 2020

Feb 2021

Dec 2020

Jun 2020

Apr 2020

Aug 2020

Feb 2020

Oct 2019

Dec 2019

Jun 2019

Apr 2019

Aug 2019

Feb 2019

Oct 2018

Dec 2018

Jun 2018

Aug 2018

Apr 2018

Oct 2017

Feb 2018

Dec 2017

Jun 2017

Aug 2017

Apr 2017

Feb 2017

Oct 2016

Jun 2016

-50％
-50%

Dec 20160%

Aug 2016

w 過去 2 年間で同社株は、同業 2 社を大幅にアウトパフォーム。

(Ref) Prepared by Alpha-Win Research Dept.
(Note) stock price as of the end of June 2016 was set to zero upon creating the graph. Reflects prices up
through the closing price on June 23, 2023.

w Valuation is expensive

compared to the TSE
Prime’s average valuation
based on this fiscal year’s
forecasts.

w Valuation also does notseem underpriced
compared to its two listedcompetitors.

Valuation
Based on the Company’s current stock price, its valuation seems expensive
in terms of the main valuation indicators compared to the average of all
stocks listed on the TSE Prime Market. Compared to the TSE Prime’s
forecasted average P/E of 15.42, the Company’s P/E based on the
Company’s profit forecasts is 29.54. Similarly, compared to TSE Prime’s
actual P/B of 1.32 and forecasted dividend yield (simple average) of 2.28%,
the Company’s is 1.57 and 1.24%, respectively (based on the closing priceon June 23, 2023).
Based on our profit forecasts, the Company’s P/E is expected to be 29.6 forthe current fiscal year, 27.9 in the next fiscal year, and 26.3 in the year after
the next.
When its valuation is compared with its two competitors, the Company’svaluation is cheap in terms of P/B but about average in terms of the othervaluation indicators (P/E, EV/EBITDA, dividend yield, and P/S), also
indicating no cheapness based on absolute values (Figure 36 on page 42).
41/43

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: 6/23/2023【Figure 36】Comparison of Valuation with Competitors
Company Name
Code (TSE Prime Market)
Stock price (at 6/23/2023 closing)Market cap (million yen)
P/E (price-to-earnings ratio)
P/B (price-to-book ratio)
Dividend yield (%)
EV/EBITDA
P/S (price-to-sales ratio)

PCA(consolidated)
9629
1,367
30,074
29.5
1.6
1.2
7.6
2.3

Obic Business Consultants(OBC: nonconsolidated)
4733
5,270
397,379
34.1
2.8
1.3
16.1
11.8

Miroku Jyoho Service(MJS: consolidated)
9928
1,575
54,820
11.5
1.9
2.9
4.9
1.3

(Note) Market cap = total outstanding shares x market stock price [at 6/23/2023 closing]
EV/EBITDA = (market cap + interest-bearing debt - cash & deposits) / (O.P. + depreciation + intangible fixed asset amortization, etc.)*Interest-bearing debt, cash & deposits, depreciation, and intangible fixed asset amortization are actual values of FY2023. Operating
profit is based on this fiscal year’s company forecasts.
The companies' estimated EPS for FY2024 was used in all P/E calculations. BPS values used in P/B calculations are actual results of
FY2023. Dividend is based on the companies’ forecasts for this fiscal year.
P/S = market cap / sales [the companies’ estimate](Ref) Prepared by Alpha-Win Research Dept. based on the financial results summaries

w The two competitors forcloud-based accounting
have extremely highvaluations.

Money Forward (TM: 3994) and freee (TM: 4478) described earlier are
also the Company’s competitors among listed companies in the area ofcloud accounting software. However, they are not reasonable targets forvaluation comparison since they have been posting net losses and paying
no dividend.
Their valuations are extremely expensive regarding the comparable
valuation measures of P/S and P/B (similar for the private company Yayoi).
*Money Forward (TSE Prime: securities code 3994)
・Market capitalization of Y310.1 billion at a stock price of Y5,753 (closing
price on 6/23)
・FY2023 (November-ending) company forecast: sales of Y28,565 million(average value of the announced range; +33.0% YoY); forecasts for
operating profit and net profit not disclosed (last fiscal year’s result: net lossof Y9,449 million); no dividend.
・P/S of 10.9 and P/B of 10.1
*freee (TSE Growth: 4478)
・Market capitalization of Y193.3 billion at a stock price of Y3,370 (closing
price on 6/23)
・ FY2023 (June-ending) company forecast: sales of Y18,821 million(+30.9% YoY), adjusted operating loss of 6,801 to 7,452 million yen, andno dividend
・P/S of 10.3 and P/B of 6.7*Yayoi (private company)
・Acquisition price estimated by KKR: approx. Y250 billion (as of Dec.
2021)
・FY2021 (September-ended): sales of Y21,193 million, recurring profit ofY4,937 million, and net assets of Y8,722 million
・P/S of 11.3, P/B of 28.7 (valuation on based on FY2021 results andacquisition price), and P/E of 74.4 (similarly estimated, with the corporate
tax rate assumed to be 32%)

42/43
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: 6/23/2023

Stock Price Outlook
While the COVID-19 regulations have become relaxed in Japan, there arestill global uncertainties concerning the economic situation due to factors
such as the prolonged war in Ukraine, inflation, and interest rates
remaining high.
w Domestic-demand-oriented
growth stock with highgrowth potential. The key
themes are cloud,subscription, DX, workstyle reform, and mental
healthcare.

w Sales and profit growthtrend expected in the next
fiscal year onward too.

However, the Company still has strengths and high growth potential in its
subscription-based businesses, including the maintenance service for its
packaged, enterprise system software and the cloud or subscription
versions of its products. It will most likely continue to be evaluated as adomestic-demand-oriented growth stock which can benefit from thegovernment’s promotion of the work-style reform, digitalization, and the
expansion of the metal-health-related market.
Also, we believe the Company will be able to return to a growth trajectory
again if the cloud business (including the work management system) drives
growth and the new businesses contribute to financial performance.
Starting this fiscal year, we expect that the Company will return to a growthtrend for sales and profits since it will not be impacted, at least for now, bya reactionary decline against an event-driven high demand.

w Considering the growth

If cost control is appropriately conducted, the downside risk to the current
fiscal year’s financial performance should be small. Assuming that there
will be a profit growth trend in the next fiscal year onwards, there is an
upside to the Company’s stock price in the medium term due to higher EPS
and dividends.

w Key points are the profit

Going forward, the following will be the key factors to watch due to theirpotential impact on the stock price.
1. Performance of the cloud business (changes in PCA Cloud’s numberof corporate users and sales growth rate)
2. Financial performance of the acquired company Dreamhop, as wellas Xronos whose growth is highly anticipated, and the sales of PCA
Hub, which the Company is currently focused on, in addition to its
contribution to profit.
3. Progress with shifting the on-premises software to subscription
services (PCA Subscription), sales of hyper, progress with the othernew products/services and new business development, amount of
upfront investment, the business’ contribution to profit, and market
competition.
4. Progress with the medium-term management plan and the profit
growth rate over the medium term
5. Measures to return profit to shareholders such as dividend hikes,
share buybacks, and stock splits
6. Progress with the M&A and alliance strategies
7. New tax systems and changes in regulations
8. How its ample cash will be effectively used

potential over the medium
term, we believe that there
is an upside to the stock
price.

growth rate over the
medium term, the cloud’s
growth rate, themonetization of the new
businesses/services(especially PCA Hub andDreamhop), measures toreturn profit toshareholders, andutilization of its cash.

43/43This 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.