Notice: This document has been translated from Japanese original for reference purpose only, without any warranty as to its accuracy or as tothe completeness of the information. The Japanese original version is the sole official version.

December 2024 1st Quarter Financial Statement [Japan Standard] (Consolidated)
May 14th, 2024
Listed company name

EM Systems Co., Ltd.

Code No.

4820

Representative:(Job title)

Representative for inquiries(Job title)

Listed on: Tokyo
Stock Exchange

URL: https://emsystems.co.jp(Name)
Hiromasa
Kunim- itsu

President&Representative Director
Managing director in the company,
General Manager of Administra- tion
Headquarters

TEL:+81(0)6-6397-1888(Name)
MegumiSeki

Planned date of subMay 14th,
Planned starting date of payment of
mission of quarterly
2024
dividends
reportSupplementary explanatory materials created for quarterly financial state- ment
Quarterly financial results briefing held (For Use by Analysts)

–
: No
: No

(Amounts of less than 1 million yen rounded down)
1. Consolidated results of December 2024 1st Quarter Financial Statement (January 1st, 2024 to March 31th, 2024)(1) Consolidated management performance (total) (% refers to rate of change over the same quarter in the previous year)
Sales

December 2024
1st quarter
December 2023
1st quarter(Note) Comprehensive income

Millionsof yen5,571

Operating profits

14.2

Millionsof yen
720

4,877

22.4

851

December
2024 1st
Quarter

573

Millions ofyen%

Ordinary profits(15.4)

Millionsof yen
873

(9.2)

25.4

961

16.6

1,644

(9.3)

December
2023 1st
Quarter

535

Millions ofyen(8.7%)%

7.0%

Quarterly net income per share after
potential stock adjustment
Yen 100ths of a yen
8.08
7.22

Quarterly net income per share
Yen 100ths of a yen
8.10
7.24

December 2024 1st quarter
December 2023 1st quarter

Quarterly net income
belonging to parent
company shareholders
Millions of
%
yen
11.7
571

(2) Consolidated financial position

December 2024 1st quarter
December 2023
December(Refer to) Net
2024 1st
capitalQuarter

Total assets

Net assets

Millions of yen
29,80429,387

Millions of yen
20,441
20,566

20,327

Millions ofyen

Capital adequacy
ratio

Net assets per share

%
68.2
69.6

Yen 100ths of a yen

December
2023 period

20,464288.65289.47
Millions ofyen

2. State of dividends
End of 1st quarter
Yen 100ths of a yen

End of 2nd quarter
Yen 100ths of a yen

Annual dividends
End of 3rd quarter
Yen 100ths of a yen

December 2023–
7.00
December 2024–
December 2024
7.00
(estimate)(Note)1. Revisions from the last published dividend estimates: None1–

End of term
Yen 100ths of a
yen
7.00

Total
Yen 100ths of a
yen
14.00

7.00

14.00

3. Estimated consolidated results of December 2024 period (January 1st, 2024 through December 31st, 2024)(% refers to rate of change over the previous term)
Net sales
Millionsof yen％Millionsof yen8.9885Profit attributable to owners of parent
Millions of ％yen

Ordinary profit
Millionsof yen％％Net income
per share
Yen 100thsof a yen

1,176

△15.6

777

△1.4

11.00

22,014
8.1
2,573
10.4
3,199
Full year(Note) 1. Revisions from the last published forecast of financial results: None

11.5

2,160

10.1

30.56

First half

10,695

Operating profit△22.6* Addendums(1) Changes in major subsidiaries during cumulative quarterly consolidated period (changes in designated subsidiaries accompanied by changes within the scope of consolidation): None
(2) Application of special accounts processing in the creation of the quarterly consolidated financial statement: Yes(Note) For details, please see the attached document P7 "2. Quarterly consolidated financial statement and major explanatory notes (3) Addendums relating to quarterly consolidated financial statement (application of special accounts processing in
the creation of the quarterly consolidated financial statement)".
(3) Changes to accounting policy, changes to estimates in accounting, revised restatements
1. Changes to accounting policies accompanying revision to accounting standards, etc. : None
2. Changes to accounting policies other than 1.

: None3. Changes to estimates in accounting: None4. Revised restatement: None(4) Number of shares outstanding (ordinary stock)
1. Number of shares outstanding at endof term (including own stock)
2. Number of own shares at end of term
3. Average number of shares outstanding
during term (quarterly total)

December 2024
1st quarter
December 2024
1st quarter
December 2024
1st quarter

74,514,800 shares
4,092,949 shares
70,560,384 shares

December 2023
periodDecember 2023
periodDecember 2023
1st quarter

74,514,800 shares
3,818,649 shares
70,649,018 shares* The quarter financial statement is not subject to quarterly review by certified public accountants or auditors.
* The descriptions of the future such as estimated results contained in this document are based on information possessed bythis company at the present time and certain assumptions this company deems reasonable, and they may differ greatly toactual results due to a variety of factors.

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○ Table of contents of attached materials

1. QUALITATIVE INFORMATION RELATING TO THIS QUARTER'S FINANCIAL RESULTS ----------------------------------------- 4(1) Explanation regarding operating results ------------------------------------------------------------------------------------------------------------ 4(2) Explanation regarding financial position ----------------------------------------------------------------------------------------------------------- 5(3) Explanation regarding information on future prospects such as forecast of consolidated financial results -------------------- 6
2. QUARTERLY CONSOLIDATED FINANCIAL STATEMENTS AND MAJOR EXPLANATORY NOTES ---------------------------- 7(1) Quarterly consolidated balance sheet ---------------------------------------------------------------------------------------------------------------- 7(2) Quarterly consolidated statements of income and quarterly consolidated statements of comprehensive income ------------ 9(3) Addendums relating to quarterly consolidated financial statement ----------------------------------------------------------------------- 10(Explanatory notes regarding prerequisites of going concern) ------------------------------------------------------------------------------- 10(Explanatory notes for cases of considerable changes in amounts of shareholder's equity) ----------------------------------------- 10(Application of special accounts processing in the creation of the quarterly consolidated financial statement) -------------- 10(Accounting policy revisions) ---------------------------------------------------------------------------------------------------------------------------- 103

1. Qualitative information relating to this quarter's financial results(1) Explanation regarding operating results
In the Japanese economy during this 1st quarter consolidated cumulative period, although the Nikkei Stock
Average hit an all-time high due to expectations of a virtuous economic cycle that would lead to overcoming
deflation through improvements to corporate earnings and the provision of wage hikes, the future of economic
activities remains uncertain due to sharp fluctuations in exchange rates and soaring energy and raw material
prices resulting from continued global-scale monetary tightening.
In the medical industry, our main clients, the timing of biennial medical fee revisions was changed from April
to June, and long-term care/welfare fees are scheduled for revision (which occurs once every three years),
making 2024 a year of simultaneous revisions to medical and long-term care/welfare services (which occurs only
once every six years). While medical fees are to be raised as a means of securing human resources and raising
wages among medical and long-term care/welfare practitioners, drug prices and other fees are to be lowered asa part of efforts to improve the stability and sustainability of the medical insurance system through greater
efficiency and optimization.
In addition, in order to achieve high quality medical care by promoting digital transformation in the medical
field along with other innovations, the Group also continued to incorporate the online eligibility verification
system, as the scope of coverage of the online eligibility verification system is expected to expand and electronicprescriptions are expected to become more commonplace, and although we have been gradually expanding thescope of incorporation of electronic prescriptions primarily among existing customers since January 2023, thenumber of installations in the 1st quarter of the current consolidated fiscal year exceeded expectations.
Furthermore, in each segment of the Group’s business, a growing percentage of sales have switched fromconventional face-to-face sales to inside sales through last year’s reorganization, and sales activities are
steadily leading to the creation of new projects through website renewals, the utilization of MA tools, and theapplication of digital marketing, including videos and enhanced content on examples of incorporation.
On the other hand, although sales increased year-on-year due to turning both Good Cycle System Inc. andUnike Software Research Co., Ltd. into consolidated subsidiaries, operating profits decreased due to the end of
intensive demand for the online eligibility verification system, which we have been incorporating since April
2021, as well as due to post-incident response expenses resulting from the “leap day” system failure.

As a result, our business results for this 1st quarter consolidated cumulative period was 5,571 million yen insales (a 14.2% increase compared to the same period in the previous year), 720 million yen in operating profits (a15.4% decrease) 873 million yen in ordinary profits (a 9.2% decrease), and 571 million yen in this quarterly net
income belonging to parent company shareholders (a 11.7% increase ).
By segment results are as follows.
(IT Systems for Pharmacies)
In regard to IT systems and related business for pharmacies, Good Cycle System Inc. and Unike Software
Research Co., Ltd. were subject to consolidation, and although sales, including billing sales, increased within
the segment due to an increase in the number of customers, operating profits decreased due to the end of
intensive demand for the online eligibility verification system.
Consequently, IT Systems and Related Business for Pharmacies for this 1st quarter consolidated cumulative
period resulted in 4,569 million yen in sales (a 20.8% increase compared with the same period in the previousyear) and 863 million yen in operating profits (a 3.3% decrease).

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(IT Systems for Clinics)
In regard to IT systems and related business for clinics, in addition to organizational restructuring, we arealso taking a wide range of approaches utilizing digital marketing.
Expanded sales of “MAPs for CLINIC” have led to steady growth in billing sales within the segment. On theother hand, sales and operating profits decreased due to the end of intensive demand for the online eligibility
verification system.
Consequently, IT Systems and Related Business for Clinics for this 1st quarter consolidated cumulative period resulted in 596 million yen in sales (a 24.7% decrease compared to the same period in the previous year)
and 86 million yen in operating losses (previous period: 51 million yen in operating profits ).
(IT Systems for Long-term Care/Welfare)In regard to IT systems and related business for long-term care/welfare, although billing sales have remained
steady due to an increase in the number of “MAPs for NURSING CARE” licenses, operating losses continue due
to a decrease in maintenance sales from replacing existing products as well as to the heavy burden of fixed costsin the segment, including depreciation associated with the release.
Consequently, IT Systems and Related Business for Long-term Care/Welfare for this 1st quarter consolidated
cumulative period resulted in 139 million yen in sales (a 1.0% decrease compared with the same period in theprevious year) and 104 million yen in operating losses (previous period: 108 million yen in operating losses)(Other businesses)
In other businesses, sales have increased due to the expansion of our cashless business via ChoQi Co., Ltd. aswell as to contributions from our temporary staffing business via Unike Software Research Co., Ltd.
The increase in sales also led to an improvement in the overall profitability of the segment, bringing operating profits into theblack.
Consequently, other business for this 1st quarter consolidated cumulative period resulted in 299 million yen
in sales (a 59.8% increase compared to the same period in the previous year) and 36 million yen in operating
profits (previous period: 2 million yen in operating profits ).
（Segmented sales and operating profits and losses are the amounts before elimination of internal transactions
between segments.）(2) Explanation regarding financial position(Assets)
Current assets at the end of this 1st quarter consolidated accounting period were 15,456 million yen, an
increase of 656 million yen from the end of the previous consolidated fiscal year. This was mainly due to a 338
million yen increase in notes and accounts receivable and a 213 million yen increase in merchandise andproducts. Fixed assets were 14,348 million yen, a decrease of 238 million yen from the end of the previous
consolidated fiscal year. This was mainly due to a decrease of 155 million yen in intangible fixed assets.
As a result, total assets were 29,804 million yen, an increase of 417 million yen from the end of the previous
consolidated fiscal year.
(Liabilities)
Current liabilities at the end of this 1st quarter consolidated accounting period were 6,491 million yen, an
increase of 873 million yen from the end of the previous consolidated fiscal year. This was mainly due to anincrease of 404 million yen in notes and accounts payable and an increase of 200 million yen in provision forbonuses. Fixed liabilities were 2,871 million yen, a decrease of 330 million yen from the end of the previous
consolidated fiscal year. This was mainly due to a decrease of 297 million yen in long-term loans payable.
As a result, total liabilities were 9,363 million yen, an increase of 542 million yen from the end of the previous
consolidated fiscal year.
(Net assets)
Net assets at the end of this 1st quarter consolidated accounting period came to 20,441 million yen, adecrease of 125 million yen from the end of the previous consolidated fiscal year. This was mainly due to anincrease of 202 million yen in treasury stock.

5As a result, equity ratio was 68.2% (69.6% at the end of the previous consolidated fiscal year).
(3) Explanation regarding information on future prospects such as forecast of consolidated financial results
The forecast of consolidated financial results for the full year ending December 2024 has not changed to the fullyear consolidated financial results forecast announced in [Summary of Consolidated Financial Results for the Fiscal
Year Ended December 2023] on February 14, 2024.

6

2. Quarterly consolidated financial statements and major explanatory notes(1) Quarterly consolidated balance sheet(Units: millions of yen)Previous consolidated
fiscal year
(December 31st, 2023)
AssetsCurrent assets
Cash on hand and in banks
Notes and accounts receivable
Merchandise and products
OthersAllowance for bad debts
Total current assets
Fixed assets
Tangible fixed assets
Buildings and structures (net)Land
Lease assets (net)
Rental assets (net)Others (net)Total tangible fixed assets
Intangible fixed assets
Software
Software in progress
Reputation
OthersTotal intangible fixed assets
Investments and other assets
Investment securities
Investment real estate (net)OthersAllowance for bad debts
Total investments and other assets
Total fixed assets
Total assets

7This 1st quarter consolidated fiscal period(March 31st, 2024)

9,441
3,082
1,136
1,139
(0)
14,800

9,524
3,421
1,349
1,162
△2
15,456

575
474
65
0
214
1,330

583
474
56
0
269
1,385

2,296
164
1,475
1,250
5,186

2,113
273
1,410
1,232
5,031

962
6,393
725
△11
8,070
14,587
29,387

906
6,344
693
△12
7,931
14,34829,804

(Units: millions of yen)Previous consolidated
fiscal year
(December 31st, 2023)
Liabilities
Current liabilities
Notes and accounts payable
Accounts payable-other
Current portion of long-term loans payable
Lease obligations
Income taxes payable, etc.
Provision for bonuses
Contract liability
OthersTotal current liabilities
Fixed liabilities
Long-term loans payable
Lease obligations
Net defined benefit liability
Long-term accounts payable
Provision for product warranties
Long-term guarantee deposits
OthersTotal fixed liabilities
Total liabilities
Net assets
Shareholder's equity
Capital stock
Capital surplus balance

Retained earnings
Treasury stock
Total shareholder's equity
Cumulative amount of other comprehensive income
valuation difference on available-for-sale securities
Foreign currency translation adjustments
Total other cumulative comprehensive income
Subscription rights to shares
Minority interests
Total net assets
Total liabilities and net assets

8This 1st quarter consolidated fiscal period(March 31st , 2024)

1,121
997
966
36
241
348
877
1,028
5,618

1,526
1,073
1,020
36
326
548
893
1,066
6,491

1,527
37
135
396
3
763
339
3,202
8,821

1,229
4
121
396
2
781
334
2,871
9,363

2,785
3,376
16,101△1,99020,272

2,785
3,376
16,178△2,193
20,146

85
106
191
56
45
20,566
29,387

46
134
180
55
58
20,44129,804

(2) Quarterly consolidated statements of income and quarterly consolidated statements of comprehensive income(Quarterly consolidated statements of income)(1st quarter consolidated cumulative period)(Units: millions of yen)

Sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profits
Non-operating profits
Interest income
Real estate rental income
OthersTotal non-operating profits
Non-operating expenses
Interest expense
Real estate rental expenses
Equity Losses of Affiliated Companies
OthersTotal non-operating expenses
Ordinary profits
Special losses
Losses on disposal of fixed assets
Loss on step acquisitions
Total special losses
Quarterly net income before adjustment for taxes, etc.
Corporation tax, etc.
Quarterly net income
Loss attributable to non-controlling interests
Profit attributable to owners of parent

Previous 1st quarter consolidated cumulative period(From January 1st, 2023
To March 31st, 2023)
4,877
2,232
2,645
1,793
851

This 1st quarter consolidated
cumulative period(From January 1st, 2024
To March 31st,2024)
5,571
2,649
2,922
2,201
720

1
251
5
258

2
260
4
267

3
108
35
1
148
961

3
104
6
114
873

0
140
141
820
310
509
(1)
511

25
25
848
263
584
12
571

(Quarterly consolidated statements of comprehensive income)(1st quarter consolidated cumulative period)(Units: millions of yen)

Quarterly net income
Other comprehensive income
valuation difference on available-for-sale securities
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total other comprehensive income
Quarterly comprehensive income(Breakdown)
Quarterly comprehensive income concerning parent
company shareholders
Quarterly comprehensive income concerning
non-controlling shareholders

Previous 1st quarter consolidated cumulative period(From January 1st, 2023
To March 31st, 2023)
509

This 1st quarter consolidated
cumulative period(From January 1st, 2024
To March 31st, 2024)
584

13
9
3
26
535

△39
28
△11
573

537

560

(1)

12

9

(3) Addendums relating to quarterly consolidated financial statement(Explanatory notes regarding prerequisites of going concern)
There is no applicable information.
(Explanatory notes for cases of considerable changes in amounts of shareholder's equity)
There is no applicable information.
(Application of special accounts processing in the creation of the quarterly consolidated financial statement)(Calculation of tax expense)
We have calculated tax expenses by multiplying quarterly net income before taxes and effective tax ratethat were reasonably estimated, following application of tax effect accounting for the income before taxes of
the consolidated accounting period including this 1st, quarter consolidated cumulative period.
(Accounting policy revisions)
There is no applicable information.

This financial report is solely a translation of the Company’s Kessan Tanshin (including attachments) in Japanese, which has been prepared in accordance with accounting principles and practices generally accepted in Japan, for the convenience of readers who prefer an English translation.

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