Note: This document has been translated from the Japanese original for reference purposes only. In the event of any
discrepancy between this translated document and the Japanese original, the original shall prevail.

November 10, 2023

Summary of Consolidated Financial Results
For the Second Quarter of the Year Ending March 31, 2024
(Under Japanese GAAP)
Company name: LEC, Inc.
Stock exchange listing: Tokyo Stock Exchange, Prime Market
Stock code:
7874
URL:
https://www.lecinc.co.jp/en
Representative:
Takaki Nagamori, President
Inquiries:
Hideo Masuda, Director, Managing Executive Officer
Telephone:+81-3-3527-2150
Scheduled date for filing quarterly securities report:
November 14, 2023
Scheduled date for commencement of dividend payments:
December 8, 2023
Supplementary information for the quarterly financial statements to be prepared: None
Meeting to explain the quarterly financial statements to be held: Yes (for institutional investors and analysts)(Yen amounts are rounded down to millions, unless otherwise noted.)

1. Consolidated Financial Results for the Second Quarter of the Year Ending March 31, 2024 (from April
1, 2023 to September 30, 2023)(1) Consolidated Results of Operations (cumulative)(Percentage figures denote change from the same period in the previous year)
Net sales

Operating profit

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

29,68810.7

936(32.5)

1,038(20.0)

474(63.3)

26,8193.6

1,385(43.2)

1,298(48.4)

1,290(14.8)

2nd Quarter of the YearEnding March 31, 2024
2nd Quarter of the Year
Ended March 31, 2023
Note: Comprehensive income

Second Quarter of the Year ending March 31, 2024: ¥1,124 million
Second Quarter of the Year ended March 31, 2023: ¥1,249 million
Basic earnings
per share

2nd Quarter of the YearEnding March 31, 2024
2nd Quarter of the Year
Ended March 31, 2023

Profit attributable toowners of parent

Ordinary profit

Diluted earnings
per share
Yen

Yen

13.66

13.53

37.39

37.04

[(10.0)%][(33.2)%]

(2) Consolidated Financial Position
Total assets

Net assets

Equity-to-asset ratio

Millions of yen

Millions of yen%

As of September 30,
2023

87,454

37,211

40.3

As of March 31, 2023

84,31636,27940.8

Reference:

Shareholders’ Equity
As of September 30, 2023:
As of March 31, 2023:¥35,260 million¥34,432 million

2. Dividends
Annual dividends per shareFirst quarter-end

Second quarter-end

Third quarter-end

Yen

Yen

Yen

Yen

Yen

―

10.00

―

10.00

20.00

―

10.00
―

10.00

20.00

Year Ended March 31,
2023
Year Ending March 31,2024
Year Ending March 31,
2024 (Estimate)Year-end

Total

Note: Changes from the latest forecasts released: None

3．Forecast for the Year Ending March 31, 2024 (from April 1, 2023 to March 31, 2024)(Percentage figures denote change from the same period in the previous year)
Net sales
Millions of yen
Full Year

60,000Operating profit% Millions of yen

8.2

1,200

Note: Changes from the latest forecasts released: None

% Millions of yen

31.7

1,200

Basic
earnings
per share

Profit attributableto owners of parent

Ordinary profit
%

10.9

%

Yen

700 (25.7)

20.19

Millions of yen

* Notes(1) Changes in significant subsidiaries during the period: None
(Changes in specified subsidiaries resulting in changes in the scope of consolidation)
New : 0Excluded : 0(2) Adoption of accounting treatment specific to the preparation of quarterly consolidated financial statements:
None(3) Changes in accounting policies, changes in accounting estimates, and restatement(i) Changes in accounting policies due to revisions of accounting standards and other regulations: None(ii) Changes in accounting policies other than (ⅰ): None(iii) Changes in accounting estimates: None(iv) Restatement: None
(4) Number of issued shares (common shares)(i)

Total number of issued shares at the end of the period (including treasury stock)
2nd Quarter of the Year Ending March 31, 2024

38,165,340 sharesYear Ended March 31, 2023

38,165,340 shares(ii) Number of treasury stock at the end of the period
2nd Quarter of the Year Ending March 31, 2024

3,296,692 sharesYear Ended March 31, 2023

3,497,492 shares(iii) Average number of shares outstanding during the period (cumulative from the beginning of the fiscalyear)
2nd Quarter of the Year Ending March 31, 2024

34,714,241 shares

2nd Quarter of the Year Ended March 31, 2023

34,515,286 shares* Quarterly financial results reports are exempt from quarterly review conducted by certified public accountants
or an audit corporation.
* Explanation of the appropriate use of business forecasts and other remarks
Business forecasts contained in this report are based on information available to the Company and on a certain
assumption the Company considers reasonable on the date of this report’s announcement, and it does notconstitute the Company’s intention to promise the accomplishment of the forecasts. Actual results may differ
significantly from such forecasts due to various risks and uncertainties. For more information regarding
assumptions made when formulating earnings projections and matters to note when using these projections,please see “(3) Explanation of Consolidated Forecast and Other Forward-looking Statements” on page three ofthe accompanying materials.
In addition, the Company has introduced ESOP, and the Company shares owned by ESOP are included intreasury stock.

LEC, Inc. (7874) Financial Results for the Second Quarter of FY3/24

Accompanying Materials ― Contents

1. Qualitative Information on Quarterly Financial Performance ......................................................... 2(1) Explanation of Operating Results ............................................................................................... 2(2) Explanation of Financial Position............................................................................................... 2(3) Explanation of Consolidated Forecast and Other Forward-looking Statements ........................ 3
2. Quarterly Consolidated Financial Statements and Primary Notes ................................................... 4(1) Quarterly Consolidated Balance Sheet ....................................................................................... 4(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income ... 6(3) Quarterly Consolidated Statements of Cash Flows .................................................................... 8(4) Notes to Quarterly Financial Statements .................................................................................. 10(Notes to going concern assumptions)...................................................................................... 10(Notes in the event of significant changes in shareholders’ equity) ......................................... 101

LEC, Inc. (7874) Financial Results for the Second Quarter of FY3/24

1. Qualitative Information on Quarterly Financial Performance(1) Explanation of Operating Results
During the six months ended September 30, 2023, the Japanese economy has been on a moderate recovery trend
due to progress in the normalization of economic activities following the removal of restrictions on movement
caused by the COVID-19 pandemic. On the other hand, future prospects remain uncertain due to factors such assustained high prices for energy and raw material caused by the prolonged invasion of Ukraine and the accelerationof the yen’s depreciation associated with tightening monetary policy amid global inflationary pressure.
In the Household Products Business, the industry LEC Group belongs to, the business environment remained
severe as consumers became more budget-minded due to real wages remaining in negative territory as a result of
rising prices, despite improvement in the employment environment.
In this environment, the LEC Group focused on the development of character goods and daily necessities of choicethat are tailored to the tastes of consumers, and expanded its business by holding promotional events including new
product announcements. We also made company-wide efforts to reduce costs by updating products and revamping
operational processes to cope with rising procurement costs due to the depreciation of the yen and soaring raw
material prices, as well as rising transportation costs.
As a result of the above, net sales during the six months ended September 30, 2023 amounted to 29,688 million
yen, (up 10.7% year on year) due to increased sales of new products and other factors. Operating profit was 936
million yen (down 32.5% year on year) and ordinary profit was 1,038 million yen (down 20.0% year on year) due
to the depreciation of the yen and increases in various costs including raw materials and import expenses. Profit
attributable to owners of parent was 474 million yen (down 63.3% year on year).
Results by product category are as follows.
(Millions of yen)
Product Category

Previous period
Apr.1, 2022-Sep.30, 2022

Household products
Cleaning/Sanitary consumables
Others11,358
10,377
5,083

Current period
Apr.1, 2023-Sep.30, 2023
12,488
11,1996,000

Year-over-year
9.9%
7.9%
18.0%

Total
26,81929,688
10.7%
Notes: Representative products of each product category are as follows
Household products…Plastic products, Chemical synthetic products, Metal products, Textile products, etc.
Cleaning ･ Sanitary consumables … Paper/Water/Urethane cleaning consumables, Nonwoven fabric sanitary consumables,
Detergents, etc.
Others…Anti-insect/virus products, Cosmetics, Home appliances, Food, Hobby and luxury grocery items, etc.

(2) Explanation of Financial Position
1) Assets, Liabilities and Net Assets
As of September 30, 2023, total assets increased 3,137 million yen from the end of the previous fiscal year to87,454 million yen.
Current assets increased 2,845 million yen to 55,031 million yen, mainly due to increases of 4,013 million yen in
cash and deposits and 1,156 million yen in notes and accounts receivable – trade, and a decrease of 1,301 million
yen in securities.
Non-current assets increased 291 million yen to 32,422 million yen, mainly due to an 839 million yen increase ininvestments and other assets, and a 420 million yen decrease in property, plant and equipment.
Liabilities increased 2,205 million yen from the end of the previous fiscal year to 50,242 million yen.
Current liabilities decreased 2,989 million yen to 8,489 million yen. This was mainly due to a 3,000 million yen
decrease in the current portion of long-term borrowings.
Non-current liabilities increased 5,194 million yen from the end of the previous fiscal year to 41,752 million yen,mainly due to a 5,225 million yen increase in long-term borrowings.
Net assets increased 931 million yen from the end of the previous fiscal year to 37,211 million yen. This was
mainly due to a 546 million yen increase in accumulated other comprehensive income.

2LEC, Inc. (7874) Financial Results for the Second Quarter of FY3/24

2) Cash Flows
As of September 30, 2023, cash and cash equivalents (hereinafter “cash”) increased 4,011 million yen from theend of the previous fiscal year to 18,417 million yen.
The details of cash flows from each activity and the major components of changes are as follows.
(Cash flows from operating activities)
Net cash provided by operating activities was 2,898 million yen (compared with 3,136 million yen provided in
the same period of the previous fiscal year). The main increasing factors were 1,987 million yen in depreciationand 1,038 million yen in profit before income taxes, while the major decreasing factor was a 1,141 million yen
increase in trade receivables.
(Cash flows from investing activities)
Net cash used in investing activities was 964 million yen (compared with 1,348 million yen used in the same
period of the previous fiscal year). The main increasing factor was 1,300 million in proceeds from sale andredemption of securities, while the major decreasing factor was 1,785 million yen for purchase of property, plantand equipment.
(Cash flows from financing activities)
Net cash provided by financing activities was 2,013 million yen (compared with 3,671 million yen provided in
the same period of the previous fiscal year). This was mainly due to a net increase of 2,225 million yen in longterm borrowings.
(3) Explanation of Consolidated Forecast and Other Forward-looking Statements
No revisions have been made to the consolidated performance forecast for the full year ending March 31, 2024,
which was announced on August 10, 2023.

3

LEC, Inc. (7874) Financial Results for the Second Quarter of FY3/24

2. Quarterly Consolidated Financial Statements and Primary Notes(1) Quarterly Consolidated Balance Sheet
FY3/23(As of Mar. 31, 2023)(Millions of yen)
Second quarter of FY3/24(As of Sep. 30, 2023)

Cash and deposits

26,51030,524

Notes and accounts receivable - trade

9,713

10,870

Securities

1,802

500

Merchandise and finished goods

9,162

8,883

657

526

Raw materials and supplies

2,665

2,382

Other

1,680

1,346

(6)

(3)

52,18555,031

Buildings and structures, net

8,083

7,998

Machinery, equipment and vehicles, net

7,151

6,424

Other, net

9,687

10,079Total property, plant and equipment

24,922

24,502

Goodwill

117

43

Other

566

512

Total intangible assets

683

555

Investment securities

5,031

5,969

Other

1,493

1,395

Allowance for doubtful accounts

(0)

(0)

Total investments and other assets

6,524

7,364

32,13032,422

84,31687,454

AssetsCurrent assets

Work in process

Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment

Intangible assets

Investments and other assets

Total non-current assets
Total assets

4LEC, Inc. (7874) Financial Results for the Second Quarter of FY3/24

FY3/23(As of Mar. 31, 2023)(Millions of yen)
Second quarter of FY3/24(As of Sep. 30, 2023)

Liabilities
Current liabilities
Notes and accounts payable - trade

2,288

2,068

200

400

5,398

2,398

150

581

8

5

Provision for bonuses

386

398

Provision for loss on disaster

35

35

Other

3,012

2,601

Total current liabilities

11,4798,489

34,05539,281

Provision for share awards

273

270

Retirement benefit liability

361

338

Asset retirement obligations

27

27

Other

1,839

1,835

Total non-current liabilities

36,55841,75248,03750,242

Share capital

5,491

5,491

Capital surplus

7,211

7,236

Retained earnings

21,573

21,691

Treasury shares(2,107)(1,968)

Total shareholders' equity

32,16932,450

1,372

1,757

Deferred gains or losses on hedges

252

329

Foreign currency translation adjustment

681

764

Remeasurements of defined benefit plans

(43)

(40)

2,263

2,810

Share acquisition rights

206

206

Non-controlling interests

1,640

1,744

Total net assets

36,27937,211

84,31687,454

Short-term borrowings
Current portion of long-term borrowings
Income taxes payable
Provision for product warranties

Non-current liabilities
Long-term borrowings

Total liabilities
Net assets
Shareholders' equity

Accumulated other comprehensive income
Valuation difference on available-for-sale securities

Total accumulated other comprehensive income

Total liabilities and net assets

5LEC, Inc. (7874) Financial Results for the Second Quarter of FY3/24(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income
Quarterly Consolidated Statements of Income
For the Six-month Period
First six months of FY3/23(Apr. 1, 2022 – Sep. 30, 2022)(Millions of yen)First six months of FY3/24(Apr. 1, 2023 – Sep. 30, 2023)

Net sales

26,81929,688

Cost of sales

18,782

21,576Gross profit

8,037

8,111

Selling, general and administrative expenses

6,651

7,175

Operating profit

1,385

936

Interest income

529

Dividend income

4248

Foreign exchange gains-

38

Subsidy income

035

Reversal of allowance for doubtful accounts

29

-

Other

38

73

Total non-operating income

117

224

Interest expenses

60

90

Share of loss of entities accounted for using equity method

37

26

Foreign exchange losses

102

-

4

4

204

121

1,298

1,038

Subsidy income

564-

Gain on reversal of foreign currency translation adjustment249-

Total extraordinary income

813-

Loss on retirement of non-current assets

20

Total extraordinary losses

20Profit before income taxes

2,109

1,038

Income taxes - current

186

508

Income taxes - deferred

561

(45)

Total income taxes

747

462

1,362

575

71

101

1,290

474

Non-operating income

Non-operating expenses

Other
Total non-operating expenses
Ordinary profit
Extraordinary income

Extraordinary losses

ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

6

LEC, Inc. (7874) Financial Results for the Second Quarter of FY3/24

Quarterly Consolidated Statement of Comprehensive Income
For the Six-month Period
First six months of FY3/23(Apr. 1, 2022 – Sep. 30, 2022)
Profit(Millions of yen)First six months of FY3/24(Apr. 1, 2023 – Sep. 30, 2023)

1,362

575

42

384

(223)

78

Foreign currency translation adjustment

65

82

Remeasurements of defined benefit plans, net of tax

2

2

(113)

548

1,249

1,124

1,179

1,020

69

103

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

Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests

7LEC, Inc. (7874) Financial Results for the Second Quarter of FY3/24(3) Quarterly Consolidated Statements of Cash FlowsFirst six months of FY3/23(Apr. 1, 2022 – Sep. 30, 2022)(Millions of yen)First six months of FY3/24(Apr. 1, 2023 – Sep. 30, 2023)

Cash flows from operating activities
Profit before income taxes

2,109

1,038

Depreciation

2,107

1,987

74

74

Share-based payment expenses

77

69

Increase (decrease) in allowance for doubtful accounts

(30)

(3)

Increase (decrease) in provision for bonuses

(2)

12

Increase (decrease) in provision for product warranties-(2)

Increase (decrease) in retirement benefit liability

(18)

(23)

Increase (decrease) in provision for share awards-(3)

Interest and dividend income

(48)

(77)

Interest expenses

60

90

Foreign exchange losses (gains)

(50)

(30)

Gain on reversal of foreign currency translation adjustment

(249)

-

Subsidy income

(564)

-

Decrease (increase) in trade receivables(656)(1,141)

Decrease (increase) in inventories

(368)

736

Decrease (increase) in other current assets

(11)

134

Increase (decrease) in trade payables

(58)

(236)

Increase (decrease) in other current liabilities

153

(83)

Amortization of goodwill

Other, net

6934

Subtotal

2,592

2,577

Interest and dividends received

54

84

Interest paid

(61)

(95)

Income taxes paid

(285)

(90)

-

364

Proceeds from corporate attracting subsidy

241-

Subsidies received

564-

Other, net

31

58

3,136

2,898

Payments into time deposits(4,212)(874)

Proceeds from withdrawal of time deposits

6,212

889

Purchase of property, plant and equipment(1,528)(1,785)

(21)

(19)

-

1,300

(1,812)

(473)

14

(0)

(1,348)(964)

Income taxes refund

Net cash provided by (used in) operating activities
Cash flows from investing activities

Purchase of intangible assets
Proceeds from sale and redemption of securities
Purchase of short-term and long-term investment securities
Other, net
Net cash provided by (used in) investing activities

8LEC, Inc. (7874) Financial Results for the Second Quarter of FY3/24

First six months of FY3/23(Apr. 1, 2022 – Sep. 30, 2022)(Millions of yen)First six months of FY3/24(Apr. 1, 2023 – Sep. 30, 2023)

Cash flows from financing activities
Proceeds from short-term borrowings

2,400

1,600

Repayments of short-term borrowings(1,400)(1,400)

Proceeds from long-term borrowings

5,750

7,800

Repayments of long-term borrowings(2,561)(5,574)

Repayments of finance lease liabilities

(58)

(56)

Dividends paid

(458)

(355)

Net cash provided by (used in) financing activities

3,671

2,013

207

63

Net increase (decrease) in cash and cash equivalents

5,668

4,011

Cash and cash equivalents at beginning of period

11,483

14,405

Cash and cash equivalents at end of period

17,151

18,417

Effect of exchange rate change on cash and cash equivalents

9LEC, Inc. (7874) Financial Results for the Second Quarter of FY3/24(4) Notes to Quarterly Financial Statements(Notes to going concern assumptions)None to be reported.
(Notes in the event of significant changes in shareholders’ equity)
None to be reported.

10