Presentation on the Financial Results for
the Fiscal Year Ended March 2020
May 14, 2020MIRAIT Holdings Corporation

Table of Contents
I. Overview of the Financial Results for the Fiscal Year
Ended March 2020

IV. Reference Materials

1. Financial Results for the Fiscal Year Ended March 2020

3-5

2. Summary by Business Category

6

3. Shareholder Returns

1. Overview of MIRAIT Holdings
2. Outline of New Medium-term Management Plan

27

3. Key Initiatives under the New Medium-term Management Plan

28

4. Changes in the Market Environment for the Mobile Business29

5. Current Industry Conditions30

6. Supplementary Financial Information

II. Shareholder Returns
Shareholder Returns

822 - 26

Precautionary Statement

31 - 36
37

III. Business Plan for the Fiscal Year Ending March 2021
1. Business environment for the Mirait Group10

2. Trends in the NTT Business

11 - 12

3. Trends in the Multi-carrier Business

13 - 14

4. Trends in the Environmental & Social Innovation Business

15 - 16

5. Trends in the ICT Solution Business17 - 18

6. Initiatives to Build a Stronger Business Base19

7. ESG Initiatives

20

Note: In this presentation material, “net income” refers to “profit attributable to owners of parent”.

1

I. Overview of the Financial Results for
the Fiscal Year Ended March 2020

1. Financial Results for the Fiscal Year Ended March 2020
FYE March 2019

FYE March 2020

Units: bil. yen

Key Highlights

YoY Change

Full-year Results

Full-year Results

Orders received

392.6

446.5

+53.9

+13.7%Net sales

375.9

441.1

+65.2

+17.3%

Amount%Achieved record-high net sales and operating income, but net income down due
to absence of extraordinary gain from management integrationOrders received: 446.5 bil. yen (+53.9 bil. yen yoy) due to increase in all businesscategories except Environmental & Social.
FYE March 2019

NTT
Multi-carrier
Environmental &Social Innovation

128.3
92.5
56.3

156.3
97.2
66.7

+28.0
+4.7
+10.4

+21.8%

Orders received(Unit: bil. yen)

+5.1%

NTT

+18.5%

Multi-carrier
Environmental& Social
ICT
Total

FYE March 2020
YoY Change

Full-year Results

Full-year Results

137.7
95.1

154.8
106.2

+ 17.1+ 11.1+ 12.4%+ 11.7%

58.4

54.3

- 4.1

- 7.0%

101.2
392.6

131.0
446.5

+ 29.8+ 53.9+ 29.4%+ 13.7%

Amount%ICT Solution

98.7

120.8

+22.1

+22.4%

Gross profit

46.9（12.5%）

52.1（11.8%）+5.2（- 0.7p）+11.1%

26.2（7.0%）

30.1（6.8%）+3.9（- 0.2p）+14.9%

20.6（5.5%）

21.9（5.0%）+1.3（- 0.5p）+6.3%(Ordinary income ratio)

21.9（5.8%）

23.2（5.3%）+ 1.3（- 0.5p）+5.9%

Net income: 15.2 bil. yen due to absence of extraordinary gains from management
integration recorded in the previous year.

Net income* 25.7(Net income ratio)（6.8%）

15.2（3.4%）- 10.5（- 3.4p）- 40.9%※Net income in FYE3/2019 (25.7 bil. yen) excluding extraordinary gains frommanagement integration was 15.7 bil. yen.

Construction accountcarried forward

144.9

150.3

+ 5.4

―

(Gross profit margin)

SG&A(SG&A ratio)

Operating income(Operating income ratio)

Ordinary income

Net sales: 441.1 bil. yen (+65.2 bil. yen yoy) due to management integration effect andgrowth in frontier domains.
Gross profit: 52.1 bil. yen (+5.2 bil. yen yoy), but gross profit margin down by 0.7 pts
due to management integration impact and decline in profit margins at former groupcompanies.
SG&A: Up 3.9 bil. yen yoy to 30.1 bil yen, but SG&A ratio improved by 0.2 pts.
Operating income: 21.9 bil yen (+1.3 bil. yen yoy)

Construction account carried forward: 150.3 bil. yen (+5.4 bil. yen yoy)

3

(Reference) Financial Results for the Fiscal Year Ended March 2020 (Former Group)* Former Group is Mirait, Mirait Technologies and Lantrovision.
FYE March 2019

FYE March 2020

Units: bil. yen

Key Highlights

YoY Change

Full-year Results

Full-year Results

Orders received

320.4

344.5

+24.1

+ 7.5%Net sales

330.8

344.3

+13.5

+ 4.1%

Amount%Achieved record-high net sales, but operating income dropped due toprovision for losses on unprofitable projects
Orders received: 344.5 bil. yen (+24.1 bil. yen yoy)FYE March 2019

NTT

101.8

99.8

- 2.0

- 2.0%

Orders received(Unit: bil. yen)NTT

Multi-carrier

87.6

85.2

- 2.4

Environmental &Social Innovation

50.3

ICT Solution

90.9

101.4

+ 10.5Gross profit

41.3

41.4

+ 0.1

（12.5%）（12.0%）（- 0.5p）(Gross profit margin)

57.8

+ 7.5

- 2.7%+ 14.9%Multi-carrier
Environmental& Social
ICT
Total

SG&A

23.6

24.4

+ 0.8

(SG&A ratio)（7.1%）（7.1%）（0.0p）

Operating income

17.6

16.9

- 0.7

(Operating income ratio)（5.3%）（4.9%）（- 0.4p）

Ordinary income

18.7

17.6

- 1.1

(Ordinary income ratio)（5.7%）（5.1%）（- 0.6p）

Net income

13.5

11.0

- 2.5

(Net income ratio)（4.1%）（3.2%）（- 0.9p）

FYE March 2020
YoY Change

Full-year Results

Full-year Results

97.5
86.7

97.0
93.0

- 0.5
+ 6.3

- 0.5%+ 7.3%

43.7

44.6

+ 0.9

+ 2.1%

92.4
320.4

109.8
344.5

+ 17.4+ 24.1+ 18.8%+ 7.5%

Amount%+ 11.6%

Net sales: 344.3 bil. yen (+13.5 bil. yen you) due to growth in frontier domains.

+ 0.2%

Gross profit margin down by 0.5 pts due to provision for losses on unprofitableprojects, etc.

+ 3.4%

SG&A: Flat year-on-year (One-off loan losses at Lantrovision)- 4.0%

Operating income: 16.9 bil. yen (-0.7 bil. yen yoy)

- 5.9%
Net income: 11.0 bil. yen (-2.5 bil. yen yoy)

- 18.5%4

■ Detailed Analysis of Operating Income [YoY Comparison]■ Detailed Analysis of Net Sales [YoY Comparison]
NTT: contribution of newly acquired companies and increase in facility managementbusiness
Multi-carrier: increase in work for Rakuten, but delay in some work for other carriers

Environmental & Social innovation: increase in completed mega-solar projects, etc
ICT Solutions: Increase in sales from LAN/PBX work, software development and salesof goods

Net sales(Unit: bil. yen)○positive factors▲negative factors

Impact of increase in net sales: +8.2 bil. yen
Drop in gross profit margin due to the provisioning for possible losses on
unprofitable projects (- 3.0 bil.yen)
SG&A increase (+4.1 bil. yen) due to increase in number of acquired subsidiaries andprovision for loan losses
Operating income ratio was in line with forecast (5%)

Operating income○positive factors▲negative factors

ICT

Increase in
net sales+ 22.1NTT+ 10.4Drop in grossprofit margin- 3.0

Environmental& Social
Multicarrier(Unit: bil. yen)

+ 8.2

Increase in
SG&A

- 3.9

+ 65.2 yoy+ 11.1 vs forecast

+ 4.7
441.1

+ 1.3 yoy
+ 0.4 vs forecast

430.0+ 28.0

20.6

21.9

21.5

FYE Mar
2020

FYE Mar
2020(Plan)

375.9

FYE Mar2019

FYE Mar
2020

FYE Mar
2020(Plan)FYE Mar20195

2. Summary by Business Category
Item (Unit: billion yen)NTT
Net sales : 156.3(YoY change : + 28.0)

Multi-carrier
Net sales : 97.2
(YoY change : + 4.7)

○positive factors▲negative factors

Key Highlights○Contribution of newly acquired companies(including work for disaster recovery)○Growth in facility management business▲Decrease in access work

Work for optical line connections○Work for Rakuten gaining full momentum○Increase in work for CATV
▲Some delays in work for other carriers (due to lack of parts and equipment)
Work for new frequencies

Environmental &Social Innovation
Net sales : 66.7
(YoY change : + 10.4)○Increase in mega-solar projects completed○Increase in civil engineering, electrical and lighting work
Work for solar power○Increase in LAN/PBX work and sales of goods○Increase in sale of goods (mobile-related, education-related)
ICT Solutions
Net sales : 120.8(YoY change : + 22.1)○Increase in software development projects(won large project for major consumer electronics retailer)○Full-scale operation of Osaka No.1 data center

LAN/PBX cabling work

▲Decrease in work to resolve TV reception interference
6II. Shareholder Returns

Shareholder Returns
Comprehensive decisions on shareholder returns will be made based on the Company’s basic policy to pay dividends consistently and its total shareholder return target of morethan 30%, while also taking into consideration the Company’s business results and cash position, among other factors.
・In FYE3/2020, the Company paid an annual dividend of 40 yen per share and repurchased shares twice (May: 2.5 bil. yen, September: 7.9 bil. yen).
・The Company redeemed all outstanding convertible bonds and allotted treasury shares as at end-December 2019
⇒ No change in issued number of ordinary shares.

■ Shareholder Returns

Total dividends (left)

Share repurchase (left)

Total return ratio (right)(Unit: bil. yen)

95.4%

15.0

100%

76.6%
7.9
7.5

50%

24.1%

23.6%

2.5

2.4

2.7

3.7

4.0

FYE March 2017

FYE March 2018

FYE March 2019

2.5
0.0

0%
FYE March 2020

6.4 bil. yen

11.5 bil. Yen

25.7 bil. Yen

15.2 bil. yen

30 yen35 yen40 yen40 yen2.4 bil. Yen

2.7 bil. Yen

3.7 bil. Yen

4.0 bil. yen

37.6%

24.1%

2.5 bil. YenーConsolidated total return ratio

76.6%

24.1%

ROE

5.2%

8.8%

Net income
Annual dividends per share
Total dividends
Consolidated dividend payout ratio
Share repurchase

13.5%（Note） （23.6%）ー
13.5%（Note） （23.6%）

15.4%（Note） （9.4%）

26.7%
10.4 bil.yen

95.4%
7.4%

(Note) Figures in ( ) for consolidated dividend payout ratio, consolidated total return ratio and ROE exclude the impact of negative goodwill from the recent acquisitions.

8III. Business Plan for the Fiscal YearEnding March 2021
As for the business performance for FYE 3/2021, the Mirait Group intends to achieve financial results in line withthe previous fiscal year.
However, at present, it is uncertain as to when the spread of COVID-19 will end.
・Postponement of the Tokyo Olympic/ Paralympic Games・Delay in some construction projects due to supply chain disruptions
・Slowdown in new orders due to deterioration in investment demand

The impact of the above factors are not reflected in the Company’s forecast for FYE 3/2020, as it is not possible
to rationally estimate such impact.
The Company will disclose any deviations in business performance from the initial forecast as appropriate.
The Company intends to pay dividends in line with the previous year.

1. Business environment for the Mirait Group
Business plan for FYE 3/2021
Orders received: 430.0 bil. yen
・Cost reduction by way
Net sales: 435.0 bil. yenof benchmarking
Op income: 22.0 bil. yen
・Efficient operations
through system
integration and the use
Enhancingof ICT tools
・Building networks in productivity
response to thedevelopment of 5G

・Building base stations
for the early launch of 5G
services(launch of 5G commercial service)＜Base Domains＞
Strengthening
core
businesses
Multi-carrier

NTT

Multi-skilling・Growth in Rakuten
business
・Promoting group-wide
adoption ofoperational systems
・Efforts to expand 5G
peripheral business＜Frontier Domains＞
・Solar power
・EMS
・Electrical, airconditioning, lighting
・Renewal of aging
infrastructure
・Storage batteries, EV
chargers

・Local 5G・Tele-work

Environmental & Social
Innovation

ICT Solutions

Generating synergies
through integration

Promoting DX to achieve
work efficiency

Undertaking
projects
selectively

Expanding
new businessdomains

Potential risks

Prolonged impact of
COVID-19 impact

Delay of Olympics/ Paralympics(work from home)・ Build infrastructure in
response to the GIGA
school concept
・Expand solution-based
sales at newly merged
companies
・Global business・Upgrade data center
business・Cloud (SD-WAN)
・Wi-Fi (ee-TaB)
・Drones10

2. Trends in the NTT Business Capital spending by NTT East/ West flat from the previous year, but focus shifting to investments in growth areas rather than existing areas.
 Enhance efficiency and safety of operations by developing multi-skilled engineers and facility inspection operations leveraging AI/ ICT.
 Improve profitability by consolidating branch offices and generating synergies with five JV companies(e.g. mutual support in the event of disasters, integrating IT systems, etc.).

■ Net sales■ Key initiatives
Initiatives（Unit: bil. yen）

160

80

156.3

Developing
multi-skilled
engineers

・Develop multi-skilled engineers to improve efficiency and expand
areas of business⇒Promote multi-skilling of on-site engineers by providing training
courses, OJT and support to acquire qualifications（Target areas: business, on-premise, access, mobile, network)

Facility
inspection
business• Develop facility inspection operations using AI and ICT to enhancesafety.
⇒ Use of automotive cameras to improve efficiency of facility
inspections and for renewals of aging facilities on an on-going basis.
• Proposals to renew aging infrastructure⇒maintenance hatches, utility conduits, bridges

152.0

128.3
98.2

100.5

0
FYE Mra 2017

FYE Mra 2018

FYE Mra 2019

FYE Mra 2020

FYE Mra 2021
(Plan)

Capital investments by NTT East and NTT West
（Unit: bil. yen）

Consolidationof offices andupgrading ofwork
environment

600

547.9

549.6

541.0

300

522.5

• Upgrade work environment to motivate employees• Enhance efficiency by consolidating area-free operations

Unpublished
Of which, opticalrelated work

156.0

154.0

161.0

150.0

156.0

FYE Mar 2017

FYE Mar 2018

FYE Mar 2019

FYE Mar 2020

FYE Mar 2021
(Plan)

0

Source: MIRAIT from company information• Consolidation of branch offices to improve productivity(Notes) 1. NTT figures based on IFRS from FYE 3/2018 (Regional communications business)
2. Figures for optical-related work from FYE 3/2019 reflect investment plans
submitted to the government.

Strengthening
group-oriented
operations• Cooperating with five JV companies to provide support for disasterrecovery operations in the event of disasters• Share initiatives across the five companies; improve earnings by
setting benchmarks, etc.
• Enhance efficiency through systems integration

11

Consolidation of branch offices/ upgrading of work environment

Developing multi-skilled engineers Achieve operational efficiency while expanding business domains, in response to
the declining working population and changes in the investment behavior.

Developing multi-skilled engineers

Decrease in working population

Business

Changes in the investment behavior of NTT

Mobile・Businesscorrespondence
training【Naganuma Building】
Completed 1/2020
Chiba

Naganuma Building【Narita Building】
Scheduled for 1/2021

NW

On-premise

Training

・Training towers

 Consolidation of branch offices

Saitama【Tokorozawa Center】
Scheduled for 5/2020

 Integration of operations

AccessTechnological development

High-performance equipment,
AI, IoT, RPA, etc.

Tokorozawa Center

Solcom・Tottori→ Okayama(11/2019)
・Shimane→ Hiroshima（scheduled for 10/2020)

Shikoku
Tsuken・Integration of construction processing operations in the Shikoku region(scheduled for 1Q2020)

Advanced facility inspection operations
 Group maintenance area into 5 units; execute periodic inspections every fiveyears
 Enhance efficiency and safety of inspection operations by leveraging AI/ ICT
Enhanced safety and quality● Use of ICT: safe and efficient inspection

Area round method●AI image analysis: consistent and accurate
evaluation

5th year●Remote diagnosis for facility inspections

Base

Third
year

●Disaster recovery support➢Cooperation between five companies
for disaster recovery support⇒Typhoon No. 15: Joint effort fordisaster recovery in Chiba

Secondyear
Automotive cameras

Remote diagnosis

On-sitediagnosis●Enhancing operational efficiency➢Integrate inspection/calculation
operation➢ Efficient Optos correction operation➢Joint events on the theme of KAIZEN

Synergies through integration●Cost reduction using
benchmarks：Poles to be inspectedin current year

4th yearStrengthening group-oriented operations➢Group-wide comparative cost analysis⇒Compiled 7-12/2019 data for threecompanies for multi-dimensional
analysis (on-going)●Integration of systems➢Cost reduction by user system
integration (launch within FY3/2021)➢Improve utilization by sharing ICT
tools developed by various groupcompanies

123. Trends in the Multi-carrier Business Base station work shifting from 4G to 5G, given expansion of 5G commercial service area ahead of initial plan.
 Increase in work for Rakuten expected given expansion of network across Japan and launch of 5G.
 Aim to maintain sales while growing profits through group-wide collaboration.
■ Net sales■ Key initiatives
Initiatives（Unit: bil. yen）

• Full launch of Rakuten Mobile
Growth in work for• Promote completion of construction projects whenadvancements inequipment/parts supply issue is resolved
4G/ new• Resolve concerns regarding suspension of construction projects
frequencies
given postponement of Olympic Games

100

50
84.1

76.9

92.5

97.2

99.0

5G penetration

Expandingbusinessdomains

0
FYE Mar 2017

FYE Mar 2018

FYE Mar 2019

FYE Mar 2020

FYE Mar 2021
(Plan)

Capital investments by the three major mobile carriers（Unit: bil. yen）

2,000
1,491.1

Promotingefficiency

1,585.3

1,744.6

8.3

187.1

Unpublished

1,437.0

3.3

320.5

350.0

381.6

369.7

400.0

519.4

560.8

601.7

615.0

610.0

1,000

RAKUTEN
Soft Bank

597.1

577.0

593.7

FY2017FY2018572.8

Unpublished

FY2019FY2020(Plan)

Efficiency/group synergies

KDDI• Promote business to support 5G verification tests (including
local 5G networks) and building 5G environment• Efforts in ”infrastructure sharing”• Improve efficiency by using IT systems for back-office and on-site
operations⇒Upgrade systems for project and on-site management⇒Develop on-site support tools⇒Further use of RPA• Reduce costs through group-wide collaboration⇒Use common parts/ equipment, jointly develop measurement
equipment, etc.
• Improve efficiency of wireless base station maintenance work bycollaborating with fixed communication business• Traini engineers on a nation-wide basis

Docomo0
FY2016• Increase in work to build 5G base stations

Source: MIRATI from company information(Notes) 1.NTT figures based on IFRS from FY2017
2. SoftBank figures prior to FY2016 reflect capital investments for the domestic telecommunications business of the SoftBank Group
3.Rakuten figures reflect total mobile-related capital investments

Global

• Maintain client base and improve profitability through cost
cutting (Australia)• Responding to more diverse customer base (Philippines)

13

Expand 5G Service Area

Adopting IT systems in mobile business

Expect work to increase ahead of schedule with the expansion of 5G service area

《 Promote development of operational tools and systems 》

No of 5G base stations

Anticipated construction
locations

40,000Top of midrise buildings

Development ofsurveillancecamerasSoftBank

20,000

Building walls of
lower levels

Windows on Sign boards onlower levels lower levels

Utility poles andstreet lights

FY2019

5G
NW

KDDI

30,000RAKUTEN

10,000

Project management system

0Project information database

FY2019 FY2020 FY2021 FY2022 FY2023 FY2024

Source: Mirait from Ministry of Internal Affairs andCommunication
FY2020Pre-service

Servicein majorcities▲Commercial service

FY2021～Service in selected areas
Service in larger
areas
Expansion of service area①

On-site③ SupportsystemDesignCost
Construction
Sales order Contract
management accounting management
management

On-sitesupportInvoicingandpayment○○
operation② Automated peripheral operations
Expand use of RPA

Initiatives in 5G services

Horizontal application of systems

Walls of mid-risebuildings①Development/ implementation of project management system②Automation using RPA and tools③Develop on-site surveillance camera for base station projects

docomoOperational synergies through mergers《Combining mobile infrastructure and solutions》

Launch task force for each carrier
to adopt common initiatives across the nation and group①Better management of golf courses; verification test with golf course operator②Solution to support local 5G/ 5G-RAN set-up

Solution to support local 5G/5G-RAN set-up
Golf player

Golf course

AI caddy

Droneinspection

Toptracer

Putting green
maintenanceusing IoT

Landing spot
forecast

Autonomous
grass mower

Developed “ECHO”, reflective board forbuilding 5G areas

Measuring the basic
properties of reflective
board

beam forming (image)
Metamaterial reflective board
Design ofreflection angle

Unmanned
reception
Photographdownload

Improved area
Incident wave

3-D mapping：本日ご紹介のソリューション

Improved 5G area (image)
Metamaterial reflective board

Design of beam width

Wall
Base station

Initiatives to generate synergies
Common/ collaborative use of resources

Efficient on-site operations

Mutual support to maintain utilization of
resources, common use of subcontractors
Joint procurement of measurement
equipment, etc.
Adopt common construction methods andpatrolling to enhance work quality

Consolidation of branch offices andwarehouses
Group-wide adoption of IT systems
Common use of RPA scenarios

Collaboration in common operations

Development of human resources Building of base stations, joint managementof maintenance operations

Sharing of know-how, joint training, etc.
Exchange of staff

 Expand orders through collaborative sales
efforts14

4. Trends in the Environmental & Social Innovation Business In solar power, shifting from mega-solar projects to work for self-consumption solar power systems and O&M business.
 Initiative in building smart communities, including installment of new energy-related facilities.
(EV chargers, rechargeable batteries, self-consumption type solar power) Generate synergies between existing business and newly acquired Tokaikoei Inc. in water utility facilities work.
■ Net sales■ Key initiatives
Initiatives（Unit: bil. yen）

【Solar power】• Roof-top middle solar facilities + rechargeable batteries(self-consumption power systems)⇒home centers, transport co., drug stores, etc.

80

New
Energy

40
56.3
42.0

66.7

61.0

43.6

FYE Mar 2018

FYE Mar 2019

FYE Mar 2020

FYE Mar 2021
(Plan)■ Breakdown of net sales（Unit: bil. yen）

Civil
engineering,
etc.

80
66.7

56.3

61.0

• Expand work to lay power lines underground⇒Roads across Japan for emergency transportation⇒Tourist areas including Kyoto• Sewage pipeline work for Tokyo⇒Acquired Tokaikoei ,etc.
⇒Promote completion of large projects

EV charging

42.0• Mega-solar construction work
⇒8 projects completed in FY2019 （76.7MW）⇒6 projects ongoing （124MW） in various locations
nationwide
・Building smart communities⇒Verify EMS model for local production/ local consumption of electricity
using ZEH and EV

0
FYE Mar 2017

• O&M (as of end-3/2020)⇒16 power generation facilities across Japan・ Work to build NW facilities for overseas carriers

43.6
Battery40

Laying of power lines
undergroundSolar power• LED installment work for municipalities

Civil engineering
Electric, airconditioning

0
FYE Mar 2017

FYE Mar 2018

FYE Mar 2019

FYE Mar 2020

FYE Mar 2021
(Plan)

Electrical/
lighting• Instalment of lighting facilities in highways• Sales growth through continuous order flows (electrical)

LED installment
work

15

Initiatives in solar power-related businessInitiatives for underground power line projects

 From FIT to self-consumption systems + O&M
Self-consumption solar power（demand driven by roof-top solar power + rechargeable battery + HEMS）
Roof-top solar power work

⇒ work for supermarkets, home centers, housing
manufactures

 Won project (under construction) at
nearby area (Sanjo-dori) thanks to thesuccess with the Ponto-cho project.
(To be compled 3/2021)

Completed (3/2020)

Before completion (present)

Solar power O&M⇒Monitoring and maintenance of mega-solar facilities
using own operation center

Operation center Initiatives in smart community projects
Achieve stable electricity supply by using excess electricity generated by solar power
Verification test to build communities that produce and consume electricity locallyEnergy-saving homes①Powergeneration

V2H【Kanagawa Pref. National Route No 1: project period 3/2020-3/2035】
 Participation in PFI project for underground power lines (3rd in Japan /1st in East Japan)
 Main line is well known as part of the Hakone Ekiden (marathon relay race) route Plan to adopt advanced construction method using CIM such as 3D design

Power producers/wholesalers
Procurementof electricity

Control ofpower sharing

Solar panel

Consumption

 Project in Ponto-cho, Kyoto to lay powerlines underground; adopted various new
construction methods for work in narrowroads.

<Comparison of Rate of Elimination of Power Poles
with Other Countries>
London/Paris/ Hong kong(2004）

100%

Singapore（2001）

100%④EV power discharge (excess)Powergeneration③Selfconsumption②Chargingseoul（2017）
Tokyo 23 wards（2017）

Before construction (present)

49%
8%

EV

Initiatives in water utility facility work
 Large project for Tokyo Metropolitan Water Bureau; work for aseismic protection ofmajor water draining conduit

PFI：Private Finance Initiative
CIM：Construction Information ModelingSource: Created by MIRAIT based on materials published by the
Ministry of Land, Infrastructure, Transport and Tourism

Initiatives in network construction projects
 Construction of second line for the 50km distance between Tokyo-Chiba area datacenters(project for foreign carrier: 98% completed)Tokyo

A routeΦ800mm propulsion machine

Water distribution pipe work(female engineer on-site)

Work to lay conduits

Double route

B routeChiba

16

5. Trends in the ICT Solution Business Expand new businesses through “selection and concentration” initiatives leveraging the strengths and skills of the Mirait Group to takeadvantage of the market trends and opportunities.
 Expand electrical facilities work through M&A and generate synergies with existing businesses at Lantrovision.
■ Net sales■ Key initiatives
Initiatives（Unit: bil. yen）

• Strengthen collaborative sales efforts with Lantrovision
LAN/PBX/
telecommunicati(domestic/ overseas)
ons equipment • ICT work for Olympics/ Paralympics faciilitiies

120

80

120.8
40

84.6

123.0

Stock Business/
Data Center

98.7

65.9

FYE Mar 2018

FYE Mar 2019

FYE Mar 2020

FYE Mar
2021(Plan)

Cloud/ NW■ Breakdown of net sales• Contact center solutions
Promote proprietary product “Casting Table 3.0”
（as of end 3/2020） adopted at 81 companies/305 locations

120.8

120

※ Software Defined Wide Area Network
Improves NW performance and cost reduction through software routing (connection)※Hyper Converged Infrastructure.
Reduces operational burden by adopting simple infrastructure that combines server, storage andvirtual functions.

123.0
Wi-Fi

98.7
84.6

Stock Business

65.9

Wi-Fi

Software
LAN・PBX

40

Goods Sales
Other
Broadcasting• Promote Wi-Fi installation⇒Hotel, retail facilities, stadiums, multi-store users, etc.
⇒High-security service （Log storage service, etc）
⇒Propose package with NW equipment and surveillance cameras
・ Operation of JUIDA certified drone schools (2 locations)

Drone

・ Sale of all-weather drones
・ Inspection of towers and bridges, surveying of disasteraffected areas

0
FYE Mar 2017

FYE Mar 2018

Osaka No.1
Data Center⇒Use of HCI※ virtualization platform technology（Unit: bil. yen）

80

• Operate owned/ leased DCs• Expand services through network DC• Meet corporate customers’ need to adopt advanced technologies⇒NW creation using SD-WAN※

0
FYE Mar 2017

LAN cabling work

FYE Mar 2019

FYE Mar 2020

FYE Mar 2021(Plan)

Goods sales

Operation oflarge drone• PC and servers to schools (Shikokutsuken)• Mobile-related goods（Daimei Tsusan）

17

Initiatives in datacenter businessInitiatives in global business Net sales target for Group: 21.4 bil. yen

 Operation of own DC and Rental DC（of which ICT (Lantrovision): approx. 17.4 bil. yen, multi-carrier: approx. 4.0 bil. yen)

6/2018: Launched operations at Osaka No 1. Datacenter
5/2019: All floors occupied and running at full capacity
Know-how from Own DC

Lantrovision
Net sales forecast: 17.4 bil. Yen
Global network of offices in 28
cities across 13 countries/regions.

Japan
Sri Lanka Expand services through network DC

Singapore＜Business environment/ strategy at Lantrovision＞

Philippines

Own DC

Rental DC

・Uncertainties in business environment due to impact
of COVID-19
・Expanding business and generating synergies withexisting businesses through M&A

4/2020 Launch of leased DC in Osaka City

Osaka No.1 Data Center

Establish network in
response to client needs

Australia
Net sales: 4.0 bil. yen(e.g. electrical facilities work: YL Integrated Pte Ltd)

Expansion※ YL Integrated Pte Ltd: net sales 2.0 bil. yen, operating income 200 mil. yen (FYE 6/2019)(Mobile sensors) Initiatives in drone business①Human resources/ locations⇒Approx. 500 pilots were trained in the 3 years up to 3/2020.
⇒Established network of pilots through alliances primarily with partner
telecommunication construction companies （11 companies）②Systems
・Won order for all-weather drone systems from Chubu Regional
Development Bureau, and Tohoku Regional Development
Bureau・Won order for drone lease in collaboration with NTT Finance・Won order for drone kitting/ maintenance from Komatsu※Connect to leased datacenter via underground cable
to expand services leveraging know-how
accumulated through own datacenter operations.

Floor OEM service
Total DC management service
Virtual network DC service

Initiatives in SD-WAN
 Respond to corporate customers’ needs to adopt advanced technologies.
 Flexible and agile response to changes in client NW environment by providing
managed service
 Secure stable income with recurring model Embedded in nation-wide service launched by partner company from end-Feb, 2020
Data center/ HQ

Public cloud

Operational
data

Water utility conduit
inspection③Alliances
・Inspection of telecommunication facilities/ station buildings and survey ofdisaster-affected areas outsourced from NTT Group・“Surveying of rice field growing conditions” for Farm Eye
・Kobe City Waterworks Bureau: surveying of water quality and algae growth atreservoirs

Closed network

Internet network

Centralized monitoring
and control

Location186. Initiatives to Build a Stronger Business BaseStrengthening the group’s business operations

Strengthening human resources Strengthen group-oriented management to enhance work capabilities,
client base and profit structure.

②

HD

ClientClient①
Mirait, Mirait Technologies, TTK, SOLCOM, Shikokutsuken Alliance
Multi-carrier(mobile)NTT

NTT subsidiaries

Mobilesubsidiaries

M&A
Conversion to full-time employment

Sub-contractors

Solution(Env/ ICT)

Solutionscompany
subsidiary.A

M&A

Solutionsrelated company③

Total number of qualifications
11,500 ⇒ 17,000 （+ 5,500）② Grow the number of qualified staff
・Identify qualifications of priority
・Encourage staff to attain multiple skills③ Achieve more diversity
・Hiring and training of engineers to respond to clients’ needs
・Strengthen human resources at subsidiaries

Telecommunication tower attraining facility

KAIZEN Activities and Workstyle Reform
Subsidiary B

MergerAcquiring of fullownership① Increase in construction/ qualified staff due to recent mergers
Construction staff
6,900 ⇒ 9,150 （+ 2,250）

Subsidiary C①KAIZEN activities
・Achieve “zero accidents (Safety) ” and “highest Quality” through Kaizen activities by the
12300 employees of the Mirait GroupANZENHINSITSU KAIZEN“AKH123” Activity
・Promote autonomous and voluntary Kaizen activities (76 KAIZEN Fellows as of 3/2020)① Strengthening NTT and Multi-carrier businesses⇒Acquisition of Toei Telecommunication (6/2019)② Expanding solutions-related businesses⇒Merger with Tokaikoei and Miyako Construction(Environmental & Social Innovation, effective 10/2019)⇒Acquisition of YL Integrated Pte Ltd (Singapore)(Environmental & Social Innovation, effective 4/2020)③ Merger of subsidiaries, acquiring 100% ownership of subsidiaries⇒Mergers: Solcom Meister and Ainet Telecommunications (6/2019)⇒Mergers: Nisshin Tsuko and Toei Telecommunication (4/2020)⇒Mergers: TTK and TTK Techno (Scheduled for 7/2020)

Goods and work methods developed and improved throughKaizen proposals; adopting RPA to improve operations

No. of proposals

14,727

16,794

18,37910,298

Deploy and improve
quality of porposals

2015

2016

2017

2018

17,7292019

Use of QR code for
efficient operation

Presentation on RPA
examples②Workstyle reform
・Proper management of overtime work and annual paid leave・Introduction of flexible working hours, irregular workstyles and telework
・Upgrading of operational tools to enhance efficiency(going paperless, reducing business travel)
・Use of ICT to achieve efficiency (RPA, i-Construction)

19

7. ESG Initiatives
E

S

Environment

・Contribute to penetration of renewable energy MW
400⇒Solar power EPC business・ Contribute to penetration of new energy⇒EV chargers⇒Rechargeable battery system

200

300
127

163

349

212

0
2014 2015 2016 2017 2018
EV chargers

Rechargeable
battery system

Society・Contribute to the local society⇒Building of infrastructure（construction work for telecommunications networks,
surveillance cameras, highways, water utility networks, etc.）⇒Early rebuilding of infrastructure following majordisasters such as typhoon and earthquakes.

⇒High-accuracy GPS system for Tokyo Fire Department

Mirait’s track record in solar panel
installation work
(generation capacity)

・Sale of goods that are environmentally-friendly
Rebuilding of utility
poles and cables⇒TTK belted net fence-Protect public facilities from damage due to wind andlightening⇒Nano-gate (Solcom)-Self-cleaning system for water supply/ drainage pipes

TTK belted net fence・ISO 14001 certification

Recovery work formobile base stations

Image sent from GPS system

・Building hard and soft systems for safety⇒Safety patrol⇒Cloud-based drive recorders
・Promoting diversity （hiring women, elderly and disabled individuals）⇒ Highest “Eruboshi” certification awarded, etc （Mirait Technologies）

Nano-gate

G

Governance・Strengthen corporate governance⇒Adopted performance-based stock remuneration plan for directors andexecutive officers (excluding outside directors and non-executive officers)⇒Establish and manage internal control system(9/2016)⇒Issues handled by Compliance Committee and Risk Management Committee⇒Self-assessment of effectiveness of Board of Directors
Expanded scope to three newly merged companies (12/2019)⇒Nomination and Compensation Committee chaired by outside director
・Secure shareholders’ rights and equality⇒Management decisions with a focus on capital costs⇒Enhance constructive dialogue with shareholders

20

IV. Reference Materials

1. Overview of MIRAIT Holdings (As of March 31, 2020)(1) Company Overview
Established

October 1, 2010

Paid-in capital

7 billion yen

President (CEO)Masatoshi Suzuki

Shares【Total outstanding shares】 108,325,329 shares

Stock listing

1st Section of the Tokyo Stock Exchange (Code: 1417)

Credit ratings

Rating & Investment Information, Inc. (R&I): A-

Location
Office network

Number of consolidated subsidiaries

5-6-36 Toyosu, Koto-ku, Tokyo【Domestic】 49 locations *Total of MIRAIT, MIRAIT Technologies, TTK, SOLCOM and Shikokutsuken【Overseas】 28 locations (Singapore, Sri Lanka, Australia, Philippines, Myanmar ,etc.)
75

Number of employees【Consolidated】 12,580

Fiscal year-end

March 31st of each year

Business description

Japan Credit Rating Agency, Ltd. (JCR): A（MIRAIT Holdings（MIRAIT（MIRAIT Technologies（Lantrovision（TTK（SOLCOM（Shikokutsuken: 100）: Consolidated 5,097）: Consolidated 3,059）: Consolidated 1,034）: Consolidated 1,068）: Consolidated 1,546）: Consolidated 676）

Telecommunications engineering work, electrical work, civil engineering work and building construction
work; management of subsidiaries and Group companies

22

(2) Business Overview
 The MIRAIT Group’s business is centered on the construction of communication infrastructure (for fixed and mobile communication), but the Group is also engaged invarious other businesses in areas such as ICT, the environment, and energy.

■Overview of business categories■ Cloud computing, office solutions, Wi-Fi, software, Broadcasting, etc.
■ Construction, maintenance and operation of telecommunication systems f general companies, etc.

(Unit: bil. yen)
441.1

450

375.9

312.9

300

150

Multi
Carrier
76.9■ Environmental/ new energy, building of social infrastructure, construction and maintenance ofelectrical and air conditioning facilities
66.7

61.0

84.6

65.9

Environmental& Social
42.0

123.0

98.7

283.2
ICT

120.8

435.0

56.3

43.6

97.2

99.0

■ Construction, maintenance and operation of mobile communication facilities■ NCC fixed communication equipment, CATV work, Global etc.

156.3

152.0

■ Construction, maintenance and operation of fixed communication facilities for NTT

FYE Mar
2020

FYE Mar
2021(Plan)

92.5
84.1

NTT

128.3

98.2

100.5

FYE Mar2017

FYE Mar2018

0
FYE Mar201923

(3) The Company’s Initiatives Since Establishment

4nd MTP (~ FYE March 2022)
Target: net sales 450, operating income 27 bil. yen. (6.0%), ROE More than 8.0%

1st MTP (~FYE March 2014)
Mid-term plan

3nd MTP (~ FYE March 2021)
Target: net sales 340,
operating income 17 bil. yen. (5.0%)
ROE More than 8.0%

2nd MTP (~ FYE March 2017)
Target: net sales 310,
operating income 17 bil. yen. (5.5%)

Target: net sales 280,
operating income 12 bil. yen. (operating income ratio 4.2%)■ Historical Performance (Unit: bil. yen)

※ Revised in FYE March 2019

25.0

400
12.5
200

0
Net sales (LHS)

Operating income (RHS)
Operating income margin

2011.32012.32013.32014.32015.32016.32017.32018.32019.32020.3

246.6

236.0

271.0

277.7

283.7

269.5

283.2

312.9

375.9

441.1

4.9

5.2

10.8

11.4

14.1

6.1

10.0

16.7

20.6

21.9

2.0%

2.2%

4.0%

4.1%

5.0%

2.3%

3.5%

5.3%

5.5%

5.0%

Net Sales by
Business Category

ICT/Civil
Engineering
28％

Mobile28%

Environment
and ICT
29％

NTT
36％
Multi-carrier
35％

NTT
44％

Expanding thebusiness throughM&A

Software(ACTIS/Practical)

Improving
efficiency

Improvement of productivity in NTT business
Consolidation of business locations
through optimization of area operations

Strengthening business basePromotingsynergies

Solar + Rechargeable battery(MIRAIT X)
Global(MIRAIT Technologies Australia)

Software(TIMETEC)

System integration/
Standardization of business processes

43％

35％

22％

Net sales +98.8 bil. yen
Software(Trust-System)

Temporary staffing(Hope Net)

Global（MIRAIT Technologies Myanmar、Lantrovision）

Reorganization ofsubsidiaries

34％

25％

Net sales +31.6 bil. yen

Library business(Libnet)Strengthening of areas(Okisokou)

41％

27％

Net sales +24.6 bil. yen
SewageAir conditioning(Nissetsu) (Katakura Kensetsu)

35％

38％

【FYE Mar 2020】【FYE Mar 2019】【FYE Mar 2017】【FYE Mar 2014】【FYE Mar 2011】

0.0

Strengthening the business base
(TTK, SOLCOM, Shikokutsuken)
Building/ energy(Nishinihon Denko)

Water utility facilities(Tokaikoei, Miyako
Kensetsu)
Mobile（Toei）

Electrical（Tsukada）

Smoothing of workload for mobile work
Consolidation of offices/ consolidation of support operations

Unification of core systems (accounting and personnel)

Consolidation of
Improved efficiency through the establishment of administrative
Project to reduce administrative expenses
head office (Tokyo)
business center (MBC) and consolidation of subsidiary operations
Promotion of the utilization
Unification
Start of CMS Consolidated tax payment Merger of Daimei and Todentsu
of idle real estateof pension systems

Enhance business base by
growing own assets

Cost reduction using benchmarks

Enhanced group-oriented management24

(4) Future Focus Areas (Frontier Domains)
Zone
DomainCloud &
Networks

Smart Office

Smart Town

Smart House• Security (Surveillance cameras, network monitoring)

Stock business &Operations

Frontier Domains

Cloud&
Networks

Wi-Fi• Disaster prevention networks• LAN, PBX• Sensor networks• Drone・ ICT for educational facilities • IoT (water supply smart meters)• ITS (self-driving)• Cloud (Servers, Network)

SoftwareEnvironment & Energy

Stock business&
Operations

Global• Data centers• Operation centers(Network maintenance, help desks)• Solar power facility operationand maintenance• Batteries + solar power
maintenance• Wi-Fi + digital signage (Digital information stands “PONTANA” )• Stadium Wi-Fi• Hotel Wi-Fi
NTT

Base Domains

Wi-Fi(Guest room tablets (ee-TaB Plus))• Office and educational Wi-Fi
Civil engineering• Convenience store Wi-Fi• Home Wi-Fi• Subway Wi-Fi• Local government Wi-Fi

MobileSoftware• Aiming to be the best partner for major SIers (finance, insurance, public sector)• Unique app development (WFM, libraries, Wi-Fi solutions)

KAIZEN

AlliancesGroup management

Human resource
development• Building related equipment(Solar power, EV chargers, LED, BEMS, access control systems)

Environment&
Energy• Air conditioning(Batteries, EV chargers, LED street
lights)• Building solar power plants• Carrier business (4 countries)

Business Foundations• Disaster prevention measures

Global• LAN cabling work
(13 countries)• Batteries + solar power• Intake of electrical power for
entire apartment buildings• HEMS

Pursuit of synergies(Domestic customers, overseas customers, building solutions)25

(3) Expansion of Business Areas Utilizing Technologies (As of March 31, 2020)
Resources (Technologies)

Current Business Usage

Qualified personnel (total qualifications)
Construction
SoftwareTotal

8,000 (12,400 qualifications)
1,150 (4,600 qualifications)9,150 (17,000 qualifications)NTT

Areas to Expand Into
Engineering area

Expanded areas
Aging infrastructure

Telecommunications/civil Engineering

Elimination of poles(Structural analysis and sensors)(For Olympics)
Civil engineering/construction

Power /switching
Civil engineering

Wireless

Multi-carrier<Details>

Civil engineering/construction

Telecommunications, civil engineeringand construction
Installation technicians (A1/DD general)
Construction managing engineers
Architect

680
360
15

(ITS/ smart cars)

Power

Power

power

Wireless

Wireless

Wireless

Wi-Fi creation(For Olympics)

LAN/WAN
SoftwareWireless

Electrical, power and switching
75
370
400

ICT Solution

Technical radio operators for on-the-ground services
95
Special radio operators for on-the-ground services
1,130
CATV engineers
30

ICT-related technologies

Wireless

Sensor networks

LAN/WAN

Telecommunications/civil Engineering

Servers

Wireless/broadcasting

Wi-Fi Solution
Servers

Cloud and DC
Environmental &Social Innovation

LAN/WAN

Drone
Telecommunications Wireless

Software

Electricity
55
1,270
80

LAN/WAN

Wireless

Wireless and broadcasting

Cisco-certified CCIE
Information technology engineers
Drone

Next-gen Mobility

Civil engineering/construction

Transmission/switching

Licensed electrical engineers
Electrical construction managing engineersType I electrical workers

Smart Cities

EV chargers

Power/switching
LAN/WAN

Solutions leveraging IoT and 5G
Telecommunications Wireless
LAN/WAN

Servers

Electricity
Servers

Broadcasting

Solar power
Electricity

Environment / Energy
Electricity

LAN/WAN

Servers26

2. Outline of New Medium-term Management Plan
■ Business environment■ Theme of New Medium-term Management Plan Upcoming era of 5G and advanced mobile services
 Development of new ICT technologies and IoT(cloud, use of drones, etc.)
 Building of leading-edge/ advanced infrastructure in light of the2020 Tokyo Olympics/ increase in inbound tourists.
 Progress in labor-saving and automation to resolve issue ofshortage of labor Increase in new energy-related facilities and social infrastructure

Tailwind for the MIRAIT Group■ Key initiatives
 Generate new business opportunities
 Accelerate transformation of business structure Enhance productivity and reduce costs through efficient operations
 Strengthen human resources Promote ESG-oriented management, safety and quality initiatives
 Capital policy■ Net sales■ Targets （FYE March 2022）

Net sales Aim to be a company that contributes to the “smart society”, throughinitiatives to enhance competitiveness amid the changing businessenvironment with the upcoming era of 5G, penetration of IoT and launchof new services that combine various technologies.

(Unit: bil. yen)
450.0

450.0 bil. yen

430.0

Mergerimpact375.9

Operating income

27.0 bil. yen

Mergerimpact312.9

Operating income
ratio
ROE

Shareholder
return policy

6.0%

Environmental& Social

ICT

MergerimpactMore than 8%
 Stable and consistent payment of dividends.
 Comprehensive decisions to be made taking into
consideration the Company’s business results andcash position, based on the rough total return
ratio of more than 30%.
 Shareholder returns to be considered with theobjective of achieving ROE of more than 8%.

Multi-carrier
MergerimpactFYE Mar 2018

FYE Mar 2019

FYE Mar 2020

NTT

FYE Mar 2022

27

3. Key Initiatives under the New Medium-term Management Plan
Generating new business opportunities Support regional development by leveraging the expanded regional coverageachieved through management integration.
 Help resolve social issues by combining business domains and technologies.
NTT×※ Frontier domains include multi-carrier (global), environmental & social innovation and ICT solutions.

LPWA【Net sales】

Base Domains

Frontier Domains

FYE 3/2014

FYE 3/2020

FYE 3/2022

５G

Combining business domains
and technologies
EV/
Sensors
rechargeable Software
Old batteries
Dronesinfrastructure
Datacenters

Environmental& Social

Support regional development

6 companies

BIGDATAAI
New energy

GlobalFYE 3/2023

IoT

RobotsExpanding regional coverage Accelerate the transformation of the business structure (shift from base domains
to frontier domains) to achieve business growth, and promote the shift to quality
within the frontier domains (profit-oriented).

Multi-carrier

Disaster
Fixed-line
infrastructure prevention WiFi
HikariCivil
engineering Collaboration

Transforming the business structure

29%

46%
31%

71%

43% 430.0 bil. yen

277.7 bil. yen

57%

49%
34%
450.0
bil. yen
46%

69%
54%

ICT

Help resolve social issues

54%

50%

66%
51%
Former Group(3 companies)

Aim to be a company that contributes to the “smart society”

3 merged companies

Strengthening human resources

Promote ESG-oriented management

 Become a company that attracts talent - a company that can fully exploit theenergy and competency of each employee and as a team, where each employee
can feel healthy and motivated at work to discover his/her potential.

 Contribute to SDGs through all business activities; identify business risks andopportunities from a broad perspective to enhance ESG and to take appropriate
measures.

Comprehensive Engineering andServices Company
Attractive

Challenger

Highly productive

Transform operational and cost
structures
Improve productivity to enhance costcompetitiveness

Enhance work-life balance

Promote diversity

Develop skills and secure the health ofeach employee

Establish an organization that engages
diverse talent50%

Key themes
Build and protect
systems to realize aconveniet society（Business activities）

Challenges• Building, maintaining and renewing social infrastructure• Promoting “smart lifestyles”• Building a disaster-resilient community

Build and protect safe
and securetechnologies（safety/ quality, HR）• Strengthening technology development/ engineering
capabilities; fostering human resources• Continuous improvement of safety and quality• Promoting diversity• Workstyle reforms = work-life balance

Build and protect ourtrust with society• Corporate governance• Environmental initiatives through business activities• Resolving labor/ safety/ environmental/ human rights
issues at suppliers• Regional development

28

4. Changes in the Market Environment for the Mobile Business～

FY2019LTE-Advanced【4G】

FY2021～

2020
Olympic/ Paralympic GamesEra name
RWC
changeGeneral
Telecommunication
method【Generation】

FY2020Ultra high-speed⇒max 10Gbps（100X 4G）【5 G】

Osaka Expo

【5 G expansion】

Multiple concurrent connections⇒1 million/k㎡ (100X 4G）

Ultra low latency⇒approx. 1 millisecond (1/10 of 4G）

Advancement in 4G▲【3 carriers 】Common target of 90% population coverage by end-3/2019

3.5㎓ band

4G

700㎒ band
1.7㎓ bandKDDI
RakutenTotal investment (FY 2014-2019)
approx. 430.0 bil. yen (total for 3 carriers)

Total investment (FY2014-2025) ）approx. 640.0 bil. yen (total for 3 carriersl)▲【KDDI】Service launched 3/2019▲ Target▲【Rakuten】4,400 base stations at end-3/2020▲【Rakuten】Full service launched 4/2020

population
coverage of 80%
in FY2025▲【Rakuten】MNO service launched 10/2019

Total investment (FY2018-2028) approx. 770.0 bil. yen (total for 2 carriers)

3.4㎓ band
docomoSoftBank
Build network in unpopulous areas
Develop services for advanced 5G
Improve reception in railway/
underground roads

3.7㎓ band

5G

28㎓ banddocomoKDDI
SoftBank
Rakuten▲ Target population coverage of 80% in FY2022

Total investment (FY2018-2028) approx. 170.0 bil. yen (total for 2 carriers)

Consideration for framework for DSS(LTE/NR)
Tax benefit program topromote investments in 5G frequency-sharing

28㎓ band

Local
5G▲【docomo】3/2020 Launch of commercial service▲【docomo】 12/2018
Launch of docomo’s 5G open partner program▲【docomo】9/2020 pre-service launch▲【KDDI】2/ 2018 launch of KDDI DIGITAL GATE

▲ 【KDDI】 9/2020 pre-service launch▲【SoftBank】 2/2018 Launch of 5G×IoT Studio▲4/1/2020. Established 5G JAPAN 【JV between KDDI,SoftBank】▲【KDDI】20,000+ base stations by 3/2022▲【KDDI】50,000+ base stations by FY2023▲【SoftBank】 11,210 base stations by 3/2022▲【Rakuten M】6/2020 Launch of commercial service▲【Rakuten M】3/2021 Launch of service in all prefectures▲3/2020 Strategic parentship agreement between Rakuten and AST&Science (US)

Total investment (FY2019-2024) approx. 1.6 trn, yen (total for 4 carriers)

docomo 795.0 bil. yen
KDDI 466.7 bil. yen
SoftBank 206.1 bil. yen
Rakuten 194.6 bil. yen

12/2019▲ Framework to be established

Guideline established / disclosed(28㎓) Start of process to establish

4.5㎓ band

Target population
coverage of 98% in FY 2024▲【docomo】20,000+ base stations by 3/2022▲【Rakuten】4/2019 5G Launch of consortium▲▲ 【4 carriers】▲【docomo】10,000 base stations by 6/2021▲ 【KDDI】 3/2020 Launch of commercial service ▲【KDDI】10,000 base stations by 3/2021▲【SoftBank】3/2020 Launch of commercial service▲【SoftBank】7/2020 pre-service launch

4.5㎓ band
docomo20% early progress in numberof 5G base station by FY2023▲ 4/2020

4/2019▲ Allocation of frequencies

framework/ application(4.5㎓) end-2020

Local 5G development verification▲2024年度
特定基地局数（ドコモ） 26,334局（KDDI） 53,626局（（楽天） 23,735局

Accelerate use of local 5G to establish infrastructure in regional areas andto mind the gap between services available in urban vs.suburban locations

Expansion of frequencies

出所：各種公表資料等より当社作成

Gradual implementation of local 5G rules29

5. Current Industry Conditions (As of March 31, 2020)
 Communication construction companies are made up of three nationwide groups (MIRAIT, COMSYS, Kyowa Exeo), and nine regional companies.
 Nine regional communication construction companies are being merged into the three nationwide groups from October 2018.
 Electrical construction and railway construction companies are also operating communications construction businesses, and some are competitors.

Communication construction companies
As of July 2018 （ 3 groups + 9 companies ）October 2018- (3 groups)

Regional
operation of business

Nationwide operation of business

MIRAIT HD GroupMIRAIT HD Group Net sales 441.1 bil.yen／Operating income 21.9 bil.yen
TTK

MIRAITTTKMIRAIT※ Merger scheduled for10/2018

SolcomSolcomMIRAIT Technologies※ Merger scheduled for 1/2019

Shikokutsuken

MIRAIT Technologies

Shikokutsuken※ Merger scheduled for 1/2019

COMSYS HD Group
Nippon COMSYSSANWA COMSYS Engineering
TOSYS
TsukenNet sales 560.8 bil.yen／Operating income 38.9 bil.yen

COMSYS HD GroupNDS

Nippon COMSYSSANWA COMSYS Engineering
TOSYS
TsukenSYSKEN
HokuwaC-CubeKyowa Exeo GroupKyowa Exeo
Daiwa Communication Facilities
EXEO TECH CORPORATION

Seibu Electric Industry

Kyowa Exeo
Daiwa Communication Facilities
EXEO TECH CORPORATIONElectrical construction companies

NEC Networks & System Integration

KindenNet One Systems

etc.
※Figures are as of FYE March 2020

ITOCHU Techno Solutions

C-CubeSeibu Electric Industry
Nippon Dentsu※ Merger scheduled for 10/2018

Railway construction companies

IT construction companies

Kandenko※ Merger scheduled for 10/2018

Net sales 524.5 bil.yen／Operating income 31.1 bil.yen

Kyowa Exeo Group

Nippon Dentsu

NDS
SYSKEN
HokuwaNippon Densetsu Kogyo

etc.

etc.

30

6. Supplementary Financial Information(1) Historical Performance
Unit: bil. yen

FYE March 2017※（ ） indicates results for the MIRAIT Group (Mirait, Mirait Technologies andLantrovision(S) Ltd.) excluding the impact from the merged companies.

FYE March 2018

Orders received

323.3

326.3

Net sales

283.2

312.9

Gross profit

33.5

39.7

11.8%

12.7%

SG&A

23.4

23.0

SG&A

8.3%

7.4%

Operating income

10.0

16.7

Operating income ratio

3.5%

5.3%

Ordinary income

10.5

17.8

Ordinary income ratio

3.7%

5.7%

Net income

6.4

11.5

Net income

2.3%

3.7%

Gross profit marginFYE March 2019

(Note)FYE March 2020

392.6

446.5

（320.4）（344.5）

375.9

441.1

（330.8）（344.3）

46.9

52.1

（41.3）（41.4）

12.5%

11.8%

（12.5%）（12.0%）

26.2

30.1

（23.6）（24.4）

7.0%

6.8%（7.1%）（7.1%）

20.6

21.9（17.6）（16.9）

5.5%

5.0%（5.3%）（4.9%）

21.9

23.2（18.7）（17.6）

5.8%

5.3%（5.7%）（5.1%）

25.7

15.2（13.5）（11.0）

6.8%

3.4%（4.1%）（3.2%）FYE March 2021
(Plan)

430.0
435.0
52.6
12.1%
30.5
7.0%
22.0
5.1%

23.3
5.4%
15.5
3.6%

(Note) Upper figure for FYE 3/2019 include extraordinary gains from acquisitions (negative goodwill of 10.0 bil. yen)
* Figures are rounded down to one decimal place.

31

※（ ） indicates results for the MIRAIT Group (Mirait, Mirait Technologies andLantrovision(S) Ltd.) excluding the impact from the merged companies.

(2) Orders Received and Net Sales by Business Category
Orders received
Units: bil. Yen

FYE March 2019

FYE March 2020

FYE March 2021

Full-year Results

Full-year Results

Full-year Plan(a)

NTT Business

Multi-carrier businessYoY Change(b)－(a)(b)

Percentage change(b)／(a)

137.7

154.8

+ 17.1+ 12.4%(97.5)（97.0）（- 0.5）（- 0.5%）

95.1

106.2

+ 11.1+ 11.7%(86.7)（93.0）（+ 6.3）（+ 7.3%）

Environmental & social
innovation business

58.4

54.3

- 4.1

- 7.0%(43.7)（44.6）（+ 0.9）（+2.1%）ICT solution business

101.2

131.0

+ 29.8+ 29.4%(92.4)（109.8）（+ 17.4）（+ 18.8%）

Total

392.6

446.5

+ 53.9+ 13.7%(320.4)（344.5）（+ 24.1）（+ 7.5%）Net sales
Units: bil. Yen

NTT Business

Multi-carrier business

Environmental & social
innovation business
ICT solution business

Total

YoY Change(c)－(b)

(c)

149.0

- 5.8

- 3.7%

98.0

- 8.2

- 7.7%

61.0

+ 6.7

+ 12.3%

122.0

- 9.0

- 6.9%

430.0- 16.4- 3.7%FYE March 2019

FYE March 2020

FYE March 2021

Full-year Results

Full-year Results

Full-year Plan(a)

YoY Change(b)－(a)(b)

Percentage change(b)／(a)

128.3

156.3

+ 28.0+ 21.8%(101.8)（99.8）（- 2.0）（- 2.0%）

92.5

97.2

+ 4.7

+ 5.1%(87.6)（85.2）（- 2.4）（- 2.7%）

56.3

66.7

+ 10.4+ 18.5%(50.3)（57.8）（+ 7.5）（+ 14.9%）

98.7

120.8

+ 22.1+ 22.4%(90.9)（101.4）（+ 10.5）（+ 11.6%）

375.9

441.1

+ 65.2+ 17.3%(330.8)（344.3）（+ 13.5）（+ 4.1%）* Figures are rounded down to one decimal place (bil. yen).

Percentage change(c)／(b)YoY Change(c)－(b)(c)

Percentage change(c)／(b)

152.0

- 4.3

- 2.8%

99.0

+ 1.8

+ 1.9%

61.0

- 5.7

- 8.5%

123.0

+ 2.2

+ 1.8%

435.0

- 6.1

- 1.4%

32

(3) Assets, Liabilities and Net Assets
 Total assets: 352.1 bil. yen (up from 331.4 bil. yen) due to increase in accounts receivable from completed construction contracts and non-current assets.

 Liabilities: 133.4 bil. yen (up from 131.9 bil. yen)due to increase in accounts payable for construction contracts, etc.
 Net assets: 218.7 bil. yen (up from 199.5 bil yen) due to increase in retained earnings and decrease in treasury stock (shareholders’ equity ratio up from 59.3% to 61.2%).

Balance Sheet as of March 31, 2019
(Unit: bil. yen)

Balance Sheet as of March 31, 2020
(Unit: bil. yen)

Liabilities
133.4

Liabilities
131.9
Total assets
331.4

Accounts payable for construction
contracts: and others 50.8
Interest-bearing debt: 30.0
(Loans/ bonds: 20.2)(Lease obligations: 9.8)

(Breakdown)
Current assets: 225.7(Breakdown)
Current assets: 211.0
Cash and deposits: 38.2
Accounts receivable from completed
construction contracts: 133.3
Costs on uncompleted construction
contracts and other :28.4

Non-current assets: 120.3
Tangible fixed assets: 78.8
Intangible fixed assets: 7.0

Total assets
352.1

Accounts payable for construction
contracts: and others 58.7
Interest-bearing debt: 27.8
(Loans/ bonds: 16.7)(Lease obligations: 10.9)

Net assets
199.5(Breakdown)
Capital stock: 7.0
Capital surplus: 71.5
Retained earnings: 124.2
Treasury stock: -9.6
Minority interest: 3.1* Figures are rounded down to one decimal place (bil. yen).

Cash and deposits: 33.5
Accounts receivable from completed
construction contracts: 147.5
Costs on uncompleted construction
contracts and other : 32.7

Non-current assets: 126.4
Tangible fixed assets: 82.5
Intangible fixed assets: 6.7

Net assets
218.7

Equity capital: 215.4
Equity ratio: 61.2%(Breakdown)
Capital stock: 7.0
Capital surplus: 69.3
Retained earnings: 135.5
Treasury stock: -1.3
Minority interest: 3.2

33

(4) Changes in Cash Position
Cash Flows
Units: bil. yen

FYE March 2017

FYE March 2018

FYE March 2019

FYE March 2020

Operating cash flow

4.7

12.5

6.4

7.9

Investment cash flow

- 11.1- 10.0- 13.5- 9.1

Financial cash flow

10.4

- 3.6

- 1.9

- 2.8

Free cash flow

- 6.4

2.5

- 7.1

- 1.2

(Note) Free cash flow = operating cash flow + investment cash flow

Cash and Deposits/ Interest-bearing Debt
Units: bil. yen

FYE March 2017

FYE March 2018

FYE March 2019

FYE March 2020

Cash and cash equivalents

33.1

32.2

35.6

31.6

Interest-bearing debt

- 18.1- 19.0- 30.0- 27.8Net cash

15.0

13.2

5.6

3.8

(Notes) 1. Net cash is the amount obtained by deducting interest-bearing debt from cash and cash equivalents.
2. Cash and cash equivalents exclude deposits and securities not maturing within three months.

* Figures are rounded down to one decimal place (bil. yen).

34

(5) Key Performance Indicators
Capital Expenditure / Depreciation and AmortizationFYE March 2017

FYE March 2018

FYE March 2019

FYE March 2020

FYE March 2021
(Plan)

Capital expenditure

4.6

12.6

19.3

9.1

7.2

Depreciation and mortization

2.8

3.0

4.0

5.8

4.4

FYE March 2017

FYE March 2018

FYE March 2019

FYE March 2020

56.9%

58.5%

59.3%

61.2%

Return on equity (ROE)

5.2%

8.8%

15.4%

7.4%

Return on assets (ROA)

3.1%

5.1%

9.1%

Unit: bil. yen

Capital-related Indicators

Equity ratio（9.4%）

4.5%(Note) FYE 3/2019 figures in () exclude the impact of extraordinary gains from recent acquisitions (negative goodwill of 10.0 bil. yen).

* Figures are rounded down to one decimal place (bil. yen).

35

(6)Shareholder Return and Shares Outstanding
Shareholder Return IndicatorsFYE March 2017

FYE March 2018

Dividend payout ratio

37.6%

24.1%

Total return ratio

76.6%

24.1%

FYE March 2019

13.5%
（23.6%）

13.5%（23.6%）FYE March 2020

FYE March 2021
(Plan)

26.7%

27.7%

95.4%

27.7%

(Note) FYE 3/2019 figures in () exclude the impact of extraordinary gains from the recent acquisitions (negative goodwill of 10.0 bil. yen).

Shares Outstanding

Unit: 1,000 shares

FYE March 2017

FYE March 2018

FYE March 2019

FYE March 2020

Issued number of shares

85,381

85,381

108,325

108,325

Number of dilutive shares

12,061

12,061

12,098－

Number of treasury shares

5,985

5,840

6,418

479

36

Precautionary Statement

Statements and quotes relevant to the forecasted values in this handout are
the future prospects based on the plans and prospects of the Company at thispoint in time.
The actual business results could be significantly different from those stated inthis handout due to changes in conditions.
As such, please be advised that we will not be able to guarantee the accuracyof the forecasted values, in this handout and the session, over the period oftime to come in the future.

MIRAIT Holdings Corporation
37