Presentation of Performance for the First Half
Fiscal Year Ending March 31, 2022

November 18, 2021

Contents
I. Overview of Performance for the First Halfof the Fiscal Year Ending March 31, 2022
1. Highlights of Financial Statements for the First Half

・・・・・・・・・

4

2. Details of Orders Received by Segment for the First Half

・・・・・・・・・

5

3. Details of Net Sales by Segment for the First Half

・・・・・・・・・

6

4. Details of Operating Profit for the First Half

・・・・・・・・・

7

5. Status of Contract Backlogs for the First Half
・・・・・・・・・
II. Full-Year Business Forecasts
for the Fiscal Year Ending March 31, 2022
1. Progress of Full-Year Business Targets for the Fiscal Year Ending March 31, 2022 ・・・・・・・・・

8

10

2. Trends in NTT Fixed-Line Related Business・・・・・・・・・

11

3. New Business Opportunities in NTT Group Related Business・・・・・・・・・

12

4. Trends in NTT Mobile Business・・・・・・・・・

13

5. Trends in NCC Business・・・・・・・・・

14

6. Status of 5G Rollout by Telecommunications Carriers

・・・・・・・・・

15

7. Trends in IT Solutions Business・・・・・・・・・

16

8. Trends in Social System-Related Business・・・・・・・・・

17

・・・・・・・・・

18

・・・・・・・・・

20

9. Promotion of Digital Transformation
III. Shareholder Returns Policy
1. Shareholder Returns Policy(Dividends and Acquisition of Treasury Stock)I. Overview of Performance for the First Halfof the Fiscal Year Ending March 31, 2022

I-1. Highlights of Financial Statements for the First Half
Net sales and operating profit increased significantly year on year.
• Orders received decreased year on year due to the decline from the high levels of the previous fiscal year in the IT/social system-related business,
although orders received in the NTT/NCC business were strong.
• Net sales increased significantly year on year due to strong sales in all segments.
• Operating profit increased significantly year on year due to growth in net sales, cost reductions, and higher productivity.

FY March 2022
1H Performance

Comparisons with
the Previous Term

Orders Received

2,724

-70

Net Sales

2,537

+194

Operating Profit

180

+56

Operating Margin

7.1%+1.8 p.p.

(Unit: ¥100 million)

Note: p.p. = percentage points4I-2. Details of Orders Received by Segment for the First Half
Orders received were strong in the NTT/NCC business and declined
from the high levels of the previous fiscal year in the IT/social system-related business.
• NTT Engineering Business: Orders received increased year on year as orders were robust in the access (AC) business (high-speed wireless-related,and conversion to fiber optic networks) and the mobile (MB) business (5G construction).
• NCC Engineering Business: Orders received increased year on year as orders from Rakuten Mobile and SoftBank remained strong.
• IT Solutions Business: Orders received decreased year on year due to a decline from the orders received for GIGA School projects
and large-scale projects in the previous fiscal year.
• Social System-Related Business: Orders received decreased year on year as the effect of newly consolidated subsidiaries (Maizuru and Asahi) failed to offset
a decline from the orders received for solar projects recorded in the previous fiscal year.

FY March 2022
1H Performance

Comparisons with
the Previous Term

NTT Engineering

1,211

+10

NCC Engineering

248

+19

IT Solutions

501

-65

Social SystemRelated and Other

763

-35

(Unit: ¥100 million)5I-3. Details of Net Sales by Segment for the First Half
Sales increased in all segments with the steady completion of contract backlogs.
• NTT Engineering Business: Sales increased significantly year on year as sales were robust in the access (AC) business (high-speed wireless-related,and conversion to fiber optic networks) and the mobile (MB) business (promotion of 5G completion).
• NCC Engineering Business: Sales increased substantially year on year due to growth in Rakuten Mobile sales and robust demand from SoftBank.
• IT Solutions Business: Sales increased year on year as completion of order backlogs offset the decrease in sales of large-scale projects recordedin the previous fiscal year.
• Social System-Related Business: Sales increased significantly year on year due to strong progress in construction of large-scale solar projects.

FY March 2022
1H Performance

Comparisons with
the Previous Term

NTT Engineering

1,106

+75

NCC Engineering

220

+32

IT Solutions

401

+7

Social SystemRelated and Other

808

+79

(Unit: ¥100 million)6I-4. Details of Operating Profit for the First Half
Profit significantly increased due to sales expansion and improvement of gross profit margin.
• Sales in in the NTT Engineering, NCC Engineering, and Social Systems-related businesses increased, contributing to profit growth.
• The gross profit margin improved due to progress in highly profitable projects, cost reductions, and higher productivity, contributing to profit growth.
• SG&A expenses increased due to boosting of construction resources and marketing capacity as a result of the expansion in construction volume
and the new consolidation of companies acquired through M&A.

Improvement ingross profit margin

Increase in
SG&A expenses(Unit: ¥100 million)-6

Net sales
growth+24

124

FY March 2021
1H Performance• NTT fixed line: Conversion
to fiber optic and highspeed wireless-related• NTT mobile: 5G
construction• NCC: Rakuten Mobile,
SoftBank• Social system: Progress of
solar projects+38• NTT fixed line: Promotion of
IT use for business• NTT mobile: 5G construction• NCC: Flexible use ofresource• IT/social system: Highly
profitable projects, cost
reductions• Boosting of construction andmarketing capabilities• New consolidation ofcompanies acquired through
M&A

180

+56
FY March 2022
1H Performance7I-5. Status of Contract Backlogs for the First Half
Contract backlog increased year on year in the NTT/NCC businessand decreased year on year in the IT/social system-related business.
• NTT Engineering Business: Contract backlog increased significantly year on year due to robust orders in AC business (high-speed wireless-related)and MB business (frontloaded 5G).
• NCC Engineering Business: Contract backlog increased year on year due to growth in Rakuten Mobile sales and robust demand from SoftBank.
• IT Solutions Business: Contract backlog decreased year on year due a decline from the high level of GIGA School projects.
• Social System-Related Business: Contract backlog decreased year on year due to a decline from the high level of solar projects and steady progresson completing the contract backlog.

(Unit: ¥100 million)

2,581

2,589
2,129
1,831
SocialSystem

807

IT
NCC

209
119

NTT

695

1,186

-32

2,362

2,549
ChangeYear on Year

1,032

1,101
1,078

-69

1,031
312
108
980

Contract backlog
Contract backlog
at beginning of 1Q at beginning of 3Q

FY March 2020

409

234
142

236
115

156

745

914

906

Contract backlog
at beginning of 3Q

Contract backlog
at beginning of 1Q

Contract backlog
at beginning of 1Q

334
171

-75
+15
+96

FY March 2021

1,010

Contract backlog
at beginning of 3Q

FY March 20228

II. Full-Year Business Forecasts
for the Fiscal Year Ending March 31, 2022

II-1. Progress of Full-Year Business Targets
for the Fiscal Year Ending March 31, 2022
Progress on net sales and operating profit is robust and we are aiming to achieve the full-year targets.
• Although progress on net sales and operating profit is strong, a decline is expected in NTT (AC and MB) orders.
• We are working steadily to complete the contract backlog, aiming to achieve the sales target.
• We will continue promoting telecommuting, and taking measures to reduce costs and improve productivity, aiming to achieve the operating profit target.

(Unit: ¥100 million)

FY March 2022

FY March 2022

1H Performance

Initial Full-Year Targets

Progress RateFY March 2021 1H
Progress Rate
(Reference)

Orders
Received

2,724

5,700

47.8％

49.5%

Net Sales

2,537

5,800

43.7％

41.8%

Operating
Profit

180

430

41.9％

32.6%

OperatingMargin

7.1%

7.4%

―

―
10

II-2. Trends in NTT Fixed-Line Related Business
Expecting an increase year on year in sales due to strong AC business projects
but a decrease in orders received from the high level recorded in the previous fiscal year.
• Net sales increased year on year in the 1H with steady progress in high-speed wireless related and conversion to optic fiber-related construction.
• In 2H, there is a risk of delays to construction progress due to possible material delays, and we will strengthen project management.
• The rollout of an IT platform for business use to all Group companies is underway, with the goal of launching Group-wide operations in the next fiscal year.
Sales of NTT Engineering Business–AC and NW(Simple total of eight companies*)

1,785

1,790

+4

220

224

775
85

NW

1,561

+49

First Half

Full YearFY March 2021

NTT Regional Communications Business capex

5,274
2,185

First Half

-2%

Full YearFY March 2021

-3%

5,100

76

1,570

First Half

Full Year Target

FY March 2022

（光コラボ含む）

No. of FLET’S Lines Provisioned(Unit: ¥100 million)

275
137

2,143

First Half

824
747

690

AC

(Unit: ¥100 million)

Full Year
TargetFY March 2022

+0%First Half Full YearFY March 2021

265

-4%

(Unit: 10,000 lines)

137

First Half

Full Year
TargetFY March 2022

[Source: Prepared by COMSYS Holdings based on NTT’s Supplementary Materials to the Financial Results for the Six Months Ended September 30, 2021]* Simple total of eight companies is the sum of net sales of the following eight companies: Nippon COMSYS Corporation; SANWA COMSYS Engineering Corporation; TOSYS Corporation; TSUKEN Corporation; NDS Co., Ltd.; SYSKENCorporation; Hokuriku Denwa Kouji Co., Ltd.; and COMSYS JOHO SYSTEM Corporation.
** Total of capex plan numbers from NTT East and NTT West11

II-3. New Business Opportunities

in NTT Group Related Business
The NTT Group has announced a goal to be carbon-neutral by 2040.

NTT Group’s Carbon-Neutral Goal

NTT Anode Energy Business

Source: NTT IR Presentation, August 2021
Source: NTT IR Presentation, August 2021

Building of a Smart Grid
Business Opportunities for
COMSYS
The entire Group will aim to win
new business opportunities.
• Construction of renewableenergy power stations,
including solar and wind
power
• Installation of storage
batteries in NTT buildings• Expansion into powertransmission anddistribution network
construction business
Source: NTT Anode Energy Presentation, September 30, 202112

II-4. Trends in NTT Mobile BusinessAlthough 5G construction remains steady, orders are expected to decrease• In 1H, 5G construction proceeded steadily, and orders, sales, and operating profit all increased from the previous fiscal year.
• In 2H, 5G construction will be steady, but a reduction in 4G is expected, and the order target anticipates a decrease year on year as initially planned.
• We aim to complete 5G construction and further improve productivity by promoting digital transformation and optimizing the useof construction resources nationwide.
Sales of NTT Engineering business–MB(Simple total of eight companies)

597
238
First Half

+22

Full YearFY March 2021

NTT DOCOMO capex*(Unit: ¥100 million)

630

+32

260

First Half Full Year Target

FY March 2022

Promote Digital Transformation of NTT Mobile Business(Unit: ¥100 million)

5,691
5,244
Communications
business
Other

-9%

2,487

2,061
+18%

1,899
First Half

5,500

Full YearFY March 2021

IT Platformsl Commence full-scale operation at all Group
companiesl Promote streamlining by introducing robotic
process automation (RPA) for backyard
operations

Digitaltransformation inwork processesl Reform front-office operations so site offices
specialize in operations directly related toconstruction, and fully consolidate otheroperationsl Respond to nationwide 5G demand bymobilizing human resources

4,750

2,244
First Half Full Year Target

FY March 2022

Source: Prepared by COMSYS based on Presentation Material for NTT docomo’s Financial Results
for the Fiscal Year Ended March 31, 2021 and NTT’s Supplementary Materials to
the Financial Results for the Six Months Ended September 30, 202113

II-5. Trends in NCC Business
Orders received and net sales grew due to acceleration of Rakuten Mobile national rollout.
• Orders received and net sales were expanded due to the increase by Rakuten Mobile in the share of 4G national rollout.
• SoftBank is aggressively promoting 5G rollout, including conversion of 4G frequencies to 5G, contributing to growth in orders and net sales.
• 4G and 5G construction at au is delayed due to material delays, but is expected to recover in 2H.

Status of KDDI

Consolidated Sales of NCC Engineering Business(Unit: ¥100 million)

472
188

First Half

500

+27

+32

Full Year

Active promotion of 5G use and acceleration of nationwide 5G rollout

220

First HalfFY March 2021

Full Year Target

FY March 2022

Source: KDDI materials for financial results briefing on the 2Q of FY ending March 31, 2022
KDDI materials for financial results briefing on the FY ending March 31, 2021

Status of Rakuten Mobile

Status of SoftBank

Population coverage rate as of September 30, 2021 over 94%

Active investment in 5G backed by steady increase in number of contracts[Forecast number of Rakuten’s Mobile 4G base stations]
llout
station ro
ide base
w
n
o
ti
a
N

March 31, 2020
4,738 base stations

April 2020

September 2020

4G service
launch5G service
launchMarch 31, 2021
Population coverage rate
80%

March 31, 2022
Population coverage rate 96%
44,000 base stations

September 30, 2021
Population coverage rate 94%
30,000 base stations

March 2021 September 2021

December 2021

Nationwide 5G rollout
Number of base stations: At least 1,000[Source: Prepared by COMSYS Holdings based on presentation materials andpress release for Q2 of FY2021 Financial Results of Rakuten Group, Inc.]

Source: SoftBank Corp. financial results briefing on the FY ending March 31, 2021
Softbank Corp. financial results briefing on the 2Q of FY ending March 31, 202214

II-6. Status of 5G Rollout by Telecommunications Carriers

5G base station rollout will proceed at rapid pace.
(Base stations)

70,00060,0005G BaseStation Opening Plans of Each Carrier
キャリア各社の5G基地局開設計画
5G Capex Plans of Each Carrier
docomoKDDI• Five years up to March 31, 2024:1
trillion yen

SB• Five years up to March 31, 2024:1
trillion yen• Cumulative total by 2030: 2 trillion yen(including 6G research and development)

Rakuten• Around 500.0 billion yen by• Around 200.0 billion yen by March 31,
March 31, 2024
2024 (4G investment expected to• Cumulative total by 2030: 2.2 trillion yen increase by 30 or 40% from(including 6G research and development)
approximately 600.0 billion yen)

50,000
SoftBank• Oct. 2021: 20,000 base stations, commence SA• Mar. 2026: 200,000 base stations• Mar. 2031: 350,000 base stations (Note 10)

docomo40,000au(KDDI)SB
Rakuten M

30,000KDDI
Approx. 10,000 basestations (Note 2)

20,000docomo10,000 base stations(Note 1)

KDDI and SoftBank
50,000 base stations (Notes 3 and 4)
Includes 5G use of 4G frequencies andjoint use with 5G Japan Corp

docomoDec. 2021 standalone (Note 10)0March 31, 2020
Ministry of Internal
Affairs andCommunications’
5G introduction
guidelines

Local 5G roll out

June 30, 2020 March 31, 2021

June 30, 2021 August 31, 2021

docomoMarch 31, 2024
80% coverage (Note 9)

docomo20,000 base stations(Note 1)

docomo12,000 base stations(Note 8)10,000docomo32,000 base stations(Note 5)

RakutenRakutenApprox. 13,000 base
March 31, 2028
Rakutenstations (Note 6)
Additional 1.7GHz band
Approx. 6,000 baseallocation
stations (Note 6)
Approx. 30,000 base
March 31, 2022 March 31, 2023
stations (Note 6)

Tax incentives for bringing forward establishment
Institutionalization for
5G use of 4G bands

Promotion of 5G and local 5G roll out

Expansion of demonstration projects and use cases(agriculture, manufacturing, education, infrastructure monitoring, and open laboratory establishment)
Local 5G licenses to be acquired by vendors,
cable TV, NTT-COM, NTT East and NTT West, local governments, and universities

Notes
1. Information on NTT Docomo presentation of 5G, new services and new products, March 18, 2020
2. KDDI, News Release, March 23, 2020
3. SoftBank, Earnings Results Briefing for FY ended March 2020

4. KDDI FY2019 General Meeting of Shareholders Q&A
5. NTT Docomo, New Service and Product Presentation 2020 – 2021 Winter and Spring, November 5, 2020
6. Ministry of Internal Affairs and Communications, information on Authorization of Establishment Plans
7. Ministry of Internal Affairs and Communications, Master Plan 3.0 on the Regional Development of ICT Infrastructure

Ministry of Internal Affairs
and Communications
March 31, 2024
Rollout target: Four-fold
280,000 base stations (Note 7)(Includes use of 4G)

8. New Product Presentation 2021-2022 Winter/Spring, October 6, 2021
9. NTT Docomo, New Service and Product Presentation 2021 Summer
10. Press releases appearing in the Nikkei Newspaper15II-7. Trends in IT Solutions Business
Public sector and education projects will offset the decline from the previously high level of GIGA School projects.
• IT market is slowly recovering amid the impact of COVID-19 and semiconductor shortages.
• Acquisition of public sector and education projects utilizing partnering will offset the decline from the previously high level of GIGA School projects over the full year.
• Focusing on developing new projects, improving productivity, and strengthening infrastructure to achieve Medium-Term Management Plan targets.
Consolidated Sales of IT Solutions Business

1055

1,070

+14

280

277
■ Software development■ Solutions■ Maintenance

394
122
241
30
First Half

711
66
Full YearFY March 2021

+7

401
139
227
34

First Half

720
70
Full Year Target

FY March 2022

Initiatives in IT Solutions Business

Main orders received in each sector

SoftwareDevelopment

Solutionsl Digital transformation projects for corporate logisticsl Development of full harness AI inspection systeml Development of smartphone service operation data platforml Cybersecurity introductionl Local government information security cloud renewall Construction of network facilities for Olympic and Paralympic
Games(Unit: ¥100 million)

IoT and local 5G projects
Cloud computing for public and private demand systems
Smart city projects
Airport privatization project

New business
Development

l
l
l
l

Strengthening
Infrastructurel Implementation of digital transformation for onsite management
processesl Coordination and strengthening of sales in the Tokyo
metropolitan areal Training of advanced engineers to support cloud computing
l Optimization of contact center operations16

II-8. Trends in Social System-Related Business
Large increase in net sales year on year due to strong progress in construction of large-scale solar projects• New consolidation of Maizuru Setsubi Kogyo (acquired by Tsuken) and Asahi Setsubi Kogyo (acquired by NDS), companies acquired through M&A in previous fiscal year
• In infrastructure, working on undergrounding of utility poles, water supply and sewage, and flood prevention projects• In renewable energy, working on acquisition of feed-in premium solar, biomass, and wind power projects• In electric facilities, focusing on expanding areas related to expressways and Ministry of Defense facilities and business expansion for data center projects

Consolidated Sales of Social System-Related Business

1,682■Infrastructure and Other■Renewable Energy■Electric Facilities

+87

930

867

728
395
155
177
First Half

+79

383
432
Full YearFY March 2021

Main orders received in each sector

Infrastructure
and Otherl Fuchu Yotsuya water service pipe constructionl Chikumagawa River improvement project

Renewable
Energyl Solar power plant constructionl Hydrogen pipeline POC testingElectric
Facilitiesl Narita Airport firefighting center constructionl Expressway communication facilities construction(Unit: ¥100 million)

1,770
808
412
249
146

First Half

430
410
Full Year Target

FY March 2022

Initiatives in Social System-Related BusinessNew business
Developmentl Focusing on developing projects with new businessmodels (PFI, FIP, concessions)l M&A

Strengthening
Infrastructurel Strengthening capabilities to win orders through virtualcompany structurel Developing managing engineers and multi-skilled
engineersl Improving productivity by promoting digital transformation(wearables)17

II-9. Promotion of Digital Transformation
Acceleration of digital transformation adapted for “new normal” society
コムシスビジョン
Digital Transformation Initiatives

Vision of Digital Transformation

NEXT STAGE 2023

Accelerate promotion of digital transformation
by maximizing the use of digital technology
Ø Value enhancement: Refine construction capabilities
through Group-wide optimization
Ø Value creation: Meet new needs basedon construction capabilities

Three-pronged initiative aimed at Group-wide optimization
Ø Integration of IT platformØ Standardization of operations
Ø Nationwide consolidation of operations
Improving comfort of working environment
by employing digital technology

Schedule for IT Platform Integration
Category

FY March 2021

FY March 2022

FY March 2023

User-related construction systems
Expand use (roll out to each company in management integration)

Operation at each company

Integration
completed

Fixed line- Access and network-related construction systems
relatedPhoto inspection systems, etc.

Mobile-related construction systems

Sharedservicesrelation

Contract administration systems

Integration
completed

Mobilerelated

Nationwide
consolidation ofcompletion
management andphoto inspections

Attendance management and accounting systems
New personnel management system
Gradual roll-out to each company
Remote conferencing tools

Communications Portal sites and mailers
Expand use of existing portal Use of cloud computing

18

III. Shareholder Returns Policy

III-1. Shareholder Returns Policy(Dividends and Acquisition of Treasury Stock)

Additional ¥4.0 billion acquisition of treasury shares to achieve a target total return ratio of 70%.
ProfitTotal Dividends

Purchase of Treasury Shares(Unit: ¥100 million)

Profit(Targets)

280
51

Negative
Goodwill

＜167＞
【228】

144 8044

Dividends
Per Share

203 8080

5872

259 8095

293 70
106

290

80
40

117

Purchase ofTreasury
Shares
Total
Dividends

March 2017*

March 2018

March 2019**

March 2020

March 2021

March 2022
(Planned)***Interim

¥20

¥25

¥30

¥35

¥40

¥45

Year-end

¥20

¥25

¥30

¥40

¥45

¥50

37.0%

36.5%

40.3%

67.5%

60.2%

67.9%

Consolidated
Payout Ratio
Total Return Ratio
Dividends + treasury shares
ProfitNumber of Sharesof Treasury Sharesat the End of the Period(Ownership Ratio)

ROE

30.8%
＜26.6%＞

85.6%＜74.0%＞

28.0%
67.5%

26.1%
[32.0％]

54.5%[66.8％]

31.86
26.42
12.29
14.16
15.96
18.47
million shares million shares million shares million shares million shares million shares(22.6%)(18.7%)(8.7%)(10.0%)(11.3%)(13.1%)
7.3%＜8.3%＞

9.4%* Figures in < > are estimates assuming no impairment loss on goodwill.
** Figures in [ ] are estimates assuming no negative goodwill.
*** Figures assuming treasury stock is acquired for the share price as of September 30.

10.6%[8.7％]

8.6%

9.2%

8.9%

20

— COMSYS Group Management Philosophy —At the COMSYS Group, we are united as a Group and strive for strong partnership and collaboration with diverse
external players in achieving our management philosophy.
• We will build a company that customers continue to choose through the construction of diverse infrastructure that carries our era forward.
• We will contribute to our country and local communities by building social infrastructure that supports affluent lifestyles.
• We will continue with unrelenting reform in our aim to further increase corporate value.

Cautionary Statement with Respect to Forward-Looking Statements

Forecast figures contained in these presentation materials are forward-looking statements that assume underlying risks and uncertain factors.
Accordingly, it should be recognized that actual results may differ from such forward-looking statements due to a variety of factors.
Important factors that could affect results include, but are not limited to, changes in economic conditions and social trends relevant to the Group’s businessareas, and downward pressure on prices for the services provided by the Group owing to fluctuations in demand and intensified competition.

For further information, please contact:
IR Department
Telephone: +81-3-3448-7000 (direct)
Facsimile: +81-3-3448-7001
E-Mail: chd-ir@comsys.co.jp
URL: https://www.comsys-hd.co.jp/