Q2 FY2024 Briefing for Analysts
and Institutional Investors
September 13, 2023

ARTNER CO., LTD.

Company Information
Name

Artner Co., Ltd.

Founded

September 18, 1962

Representative President and CEO SEKIGUCHI Sozo
Share listingFirst Section of the Tokyo Stock Exchange (Securities code: 2163)

General Meetingof Shareholders

Held in Osaka

Capital238,284,320 yen (As of January 31, 2023)

Headquarters

Tokyo, Osaka

Businessbases
Learning
centers
Business
fieldsNumber of
employees
LicensenumberYokohama, Utsunomiya, Osaka, Nagoya
East Japan, West Japan
Basic research, design, and development in the1) Software 2) Electronics 3) Machinery fields on the left, as well as tasks relating to them
1,276 (As of January 31, 2023)
Worker Dispatching Business (派27－020513)
Paid Employment Agency Business (27－ユ－020355)

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

2Investment Highlights

1

The ninth consecutive period of sales and profit growth,double-digit growth

p. 3

2

Financial summary for Q2 FY2024

p. 14

3

Progress toward achieving the Prime listing criteria

p. 25

4

Stable and continuous dividend payments

p. 39

5

Reference

p. 43

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved3

1

The ninth consecutive period of sales and profit growth, double-digit growthMarket size of engineer dispatching business, our clients’ R&D costs■Market size of engineer dispatching business

1.1 to 1.3 trillion yen(estimate)Calculated by the Company based on the “Combined results of reports
on worker dispatching businesses” (Ministry of Health, Labour and Welfare)*The data of "annual net sales" of the worker dispatching businesses are used, which is a rough total of net sales arising from "dispatched workers
on open-ended contracts" and either of "manufacturing engineers," "information processing & communications engineers," or "other engineers."*The share is 0.7 to 0.8%; calculations based on the Company’s most recent net sales of 9.2 billion yen for FY2023.

■ Our clients’ R&D costs

Our clients continuously allocate a budget for R&D, which keeps R&D costs stable.
September 2008: Global financial crisis

150
100

100

95

83

87

91

95

102

107

112

110

115

120

123

117

119

129

137

50
0

*Calculations were made by using the data of FY2008 as 100 (baseline). *The costs of our listed clients whose fiscal year ends on March 31 were totaled.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved4

1

The ninth consecutive period of sales and profit growth, double-digit growth

Factors behind “the ninth consecutive period of sales and profit
growth, double-digit growth”■Trust from our clients built on our long history
Over our long history of 61 years, we have built trust with many of our clients andhave a proven track record.
⇒ We can place newly graduated engineers with little or no experience,as well as place additional existing engineers.

■Business model developed by Artner since nine periods ago
Even during the global financial crisis of 2008, not many engineers placed in the
upstream processes of the work processes of manufacturers (R&D, design anddevelopment) experienced contract cancellations.
Artner decided to increase the ratio of engineers placed in upstream processes.
In order to recruit outstanding students who can be placed in upstream processes,
internal programs (e.g., job change assistance program, performance-based salarysystem, limited area system) were introduced based on the needs of engineers.
Placements were made after education and training were conducted according to ourclients’ upstream process work.
⇒ The unit price of engineers increased, resulting in higher profit margins.

■Placement of engineers in technical fields with high market needs
Assigned to projects for developing electric vehicles (EVs), fuel cell vehicles (FCVs),
infrastructure (charging infrastructure, hydrogen stations), automated driving,semiconductors, etc.
⇒ Utilization rate remained high.
Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved5

1

The ninth consecutive period of sales and profit growth, double-digit growth

History (at the time of founding in 1953)

1953 -

Originally founded as
Sekiguchi Kogyo Co., Ltd.
in Amagasaki, Hyogo in 1953.
Founded Sekiguchi
Kogyo Co., Ltd. in
Amagasaki, Hyogo

Reproduces and binds design
drawings received from clientcompanies, using whiteprinting
and blueprinting techniques.
Made reproductions and design
drawing bindings using whiteprinting
and blueprinting techniques.

Our engineers visit frequently
the design departments ofclient companies.
Our engineers started to frequently
visit the design departments of clientcompanies.

FoundedManufactured and sold industrial gloves.

Started hiring employees with STEM
degrees and offering a tracing service
for design drawings.

Received increasing requests for“design and development services.”Of
course.

Manufactures and sells
gloves for use in heavy
industries in the Hanshin
Industrial Region.

Starts hiring employeeswith STEM degrees andoffering a tracing service
for design drawings.

We are interested
in tracing as well
as your designand development
services.

Demand increases fromclients for tracing andother designing anddevelopment services.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved6

1

The ninth consecutive period of sales and profit growth, double-digit growth

History (1962 to present)

1962 Company stock listed on
JASDAQ.
Stock listing
moved up to theFirst Section of
the Tokyo Stock
Exchange.

Worker Dispatching
Act takes effect inJapan.

1962

1998
1986

Establishes Osaka
Technology Center
Co., Ltd. to offer
design anddevelopment
services.

2017

2018

2007

Changes the company
name to Artner Co.,
Ltd.

2022
Transitioned to thePrime Market of
the Tokyo Stock
Exchange.

Celebrates
the 60th
anniversaryof itsfounding.

Celebrates the 55th
anniversary of its
founding. / Stock listing
moved to the Second
Section of the Tokyo
Stock Exchange.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved7

1

The ninth consecutive period of sales and profit growth, double-digit growthPresidents Since Our Founding / Profile of President and CEO
SEKIGUCHI Sozo
■Presidents Since Our Founding
September 1962

Osaka Technology Center Co., Ltd. was established as a subsidiary of
Sekiguchi Kogyo Co., Ltd.
(1st) President and CEO SEKIGUCHI Noboru was appointed.

April 1984

President and CEO SEKIGUCHI Noboru retired.
(2nd) President and CEO MARUHASHI Shiro was appointed.

April 1987

President and CEO MARUHASHI Shiro retired.
(3rd) President and CEO SEKIGUCHI Masaru was appointed.

April 1998

Osaka Technology Center Co., Ltd. was renamed to Artner Co., Ltd.

February 2002

President and CEO SEKIGUCHI Masaru retired.
(4th) President and CEO SEKIGUCHI Sozo was appointed.

■Profile of President and CEO SEKIGUCHI Sozo,
positions and areas of responsibility held in the Company
June 1983

Joined MEITEC CORPORATION

April 1988

Joined Osaka Technology Center Co., Ltd. (previous name of the Company)

March 1993

Appointed Director; Head of the Business Planning OfficeFebruary 1998

Appointed Director; Vice President

February 2002

Appointed President and CEO (current)

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved81

The ninth consecutive period of sales and profit growth, double-digit growth

The Company’s Groups corresponding to the work processes ofmanufacturers■Upstream processes are markets less affected by economic conditions■Emphasis on assignment to design and development projects (especially automobile manufacturers)■Placement in upstream processes results in higher unit prices of engineers
Product
planning

Testing

Manufacturing, operation,
maintenance

Assembly evaluation

Programming

This market segment covers a wide
range of design-related tasks andcorresponds to the majority of designand development work.

Quality inspection

Schematics
Bill ofmaterials

Wide
Value Group

Sales

Production
Prototyping, evaluation,
drawing modification

Mechanicaldrawing Parts
drawing

This market segment requires
advanced technical skills anddesign, e.g., advanced
development, R&D.

Detailed design

High
Value Group

Product
development

Basic design

Conceptual design

Organizational
structure ofArtnerR&D

Work
processes ofmanufacturers

R&D

Product
Value Group
This market segment is associatedwith quality assurance, assembly
and adjustment, and other aspects
of product quality and production.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved91

The ninth consecutive period of sales and profit growth, double-digit growth

Diagram of the work processes of manufacturers andthe work of the Company’s engineers [Ex: electric vehicles (EVs)]
Basic design / Detailed design
Mechanical drawing Parts
drawing
Schematics
Bill of materials
Programming

R&D
Conceptual design

Prototyping, evaluation,
drawing modification
Quality inspection／
Assembly evaluation
Testing

End

Manufacturing,
operation,
maintenance

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved10

1

The ninth consecutive period of sales and profit growth, double-digit growth

Design and development projects including “carbon neutrality”
Eco cars

Fuel cell vehicles (FCVs)
Software●Development of brake control
system●Analysis of motors and inverters

Software●R&D of hydrogen station
system
●R&D of energy system

Electronics●R&D of next-generation fuel cells●Hybrid system design●Safety evaluation of automotive
batteries

Machinery●Development of eco car
chargers●Development of drive motors

Automated driving

Electronics●Analysis of basic performanceof fuel cells●R&D of hydrogen safety

Semiconductors

Software

Software●R&D of Driving Safety Support
Systems●Advance development of
automatic perimeter monitoring
system using camera images●Development of applications
for semiconductor
manufacturing equipment

Electronics●Development of parking assist
system (e.g., automatic braking,accelerator control)●Development of lane keeping
assist (e.g., steering assistance)

Electronics●Circuit design for
semiconductor lithographyequipment

Machinery●Development of temperature
controller for semiconductor
lithography equipment(enclosure concept, basic
design)Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved11

1

The ninth consecutive period of sales and profit growth, double-digit growth

Products and systems related to design and development
Home electronics
Software●Development of energy system●Development of iPhone
applications

Electronics●Prototyping, evaluation, andanalysis of smartphone circuitboards●Circuit design for AV equipment

Machinery●Design and development ofhome appliances (enclosure
design, structural design)●Development of in-car
navigation system

Motorcycle

Medical devices
Software●R&D of walking assist devices●R&D of pulse measuring
equipment

Electronics●Design and development ofcontrol board for X-ray imaging
system●Evaluation of visceral fat
measuring device

Machinery●Development of PET system●Improvement of bloodtransfusion and infusion sets,
design of next set

Aerospace machinery
Software●Development of test softwarefor development of brakes●Development of softwarefor digital meters

Electronics●Design of harnesses forelectrical wiring

Machinery●Design and development offrames●Design and development ofelectric motorbikes

Software●R&D of next satellites●Development and evaluation ofsimulators for satellite radio
communication equipment

Electronics●Development of satellite
inspection equipment

Machinery●Design and development ofaircraft test jigs
●Development of passenger
aircraft AV equipment●Design and development ofaircraft
Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

12

The ninth consecutive period of sales and profit growth, double-digit growth1

Numerical business targets <FY2025 (final year) earnings andsales targets>
Operatingmargin11.6 billion yen

Net sales

14.0 ％

Unit: ¥ million / %Net sales

Operating margin

14.0

12,000The ninth consecutive
period of growth in net sales
10,000

11.8

12.4

12.7

12.4

12.9

12.5

11,600

7,002

6,000

5,765

4,000

4,761

10.0

8,102

7.9

4,287

12.0

9,242

9.1

4.9

14.0

9,797

10.7

8,000

13.5

7,174

8.0

6,331

5,153

6.0
4.0

3,856
2,000

2.0

0

0.0
FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

FY2023

FY2024(est.)FY2025(proj.)

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

13Investment Highlights

1

The ninth consecutive period of sales and profit growth,double-digit growth

p. 3

2

Financial summary for Q2 FY2024

p. 13

3

Progress toward achieving the Prime listing criteria

p. 25

4

Stable and continuous dividend payments

p. 39

5

Reference

p. 43

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

14

2

Financial summary for Q2 FY2024

Financial summary for Q2 FY2024
Marketenvironment■The global economy is slowly recovering in tandem with growth in demand postCOVID-19.
■Interest in development among our main clients, manufacturers in industries
related to automobiles and semiconductor manufacturing equipment, remains
strong.
There is a strong demand for the Company’s engineers.

State ofengineer
dispatchingbusiness■The number of operative personnel surpassed that of the same period of thepreceding year.
Number of engineers increased.
Utilization rate remained high due to the upward trend in the demand forengineers.
Assignments for newly graduated engineers entering the Company in 2023 areprogressing ahead of the initial schedule.
■The unit price of engineers surpassed that of the same period of the precedingyear.
Due to the trend of engineer shortage, the unit price for newly graduatedengineers at their first assignments is on the rise.
We are negotiating unit prices with our clients, taking into account the work
performance of our current engineers.
■Total work person-hours remained at the same level as the same period of thepreceding year.

Expenses■We are increasing our number of staff and engaging in recruitment advertising andother forms of recruitment investment.
■Expenses for recruiting, travel, transportation, and others grew with a recovery in
our recruiting and sales activities.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

15

2

Financial summary for Q2 FY2024

Financial results highlights for Q2 FY2024■ Net sales up 10.7%, operating profit up 27.7%,

ordinary profit up 27.6%, profit up 28.8%. Operating margin 17.6%.

ResultPercentage

ResultPercentage

Changefrom thepreviousyear(million yen)(%)(million yen)(%)(million yen)

Q2 FY2023

Q2 FY2024

Changefrom theprevious
year
(%)

4,522

100.0

5,006

100.0

484

10.7

2,890

63.9

3,115

62.2

225

7.8

Gross profit

1,632

36.1

1,890

37.8

258

15.8

SG&A
expenses

941

20.8

1,008

20.2

67

7.2

Operating profit

690

15.3

882

17.6

192

27.7

Ordinary profit

691

15.3

882

17.6

191

27.6

Profit

479

10.6

617

12.3

138

28.8

Net sales
Cost of sales■Number of engineers
increased.
■Utilization rate remained high■The number of operative
personnel increased.
■Unit price of engineers rose

■More staff, recruitment
advertising and otherrecruitment investment■Travel/transportation fees,
etc. increased due torecovery of recruitment andsales activities

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

16

2

Financial summary for Q2 FY2024

Net sales by business for Q2 FY2024■Engineer dispatching up 9.8% ■Contracting up 14.3% / Percentage 8.6%
Unit: million yen

5,500

Q2 FY2023

Total: 5,006

5,000

Total: 4,522

ResultRatio

ResultRatio(millionyen)(%)(millionyen)(%)

Engineer
dispatching
services

4,135

91.4

4,542

90.7

9.8

▲ 0.7

Contracting

378

8.4

432

8.6

14.3

0.3

Subtotal

4,513

99.8

4,974

99.4

10.2

▲ 0.4

Other

9

0.2

32

0.6

241.4

0.4

Total

4,522

100.0

5,006

100.0

10.7

4,500
4,000
3,500
3,000
4,542
2,500

ChangePercentfrom theageprevious
varianceyear

Q2 FY2024

(%)

(pt)

4,135

2,000
1,500
1,000

432

378

500
32

9

―

0
Q2 FY2023

Q2 FY2024

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

17

2

Financial summary for Q2 FY2024

Net sales by industry field for Q2 FY2024■Electrical equipment up 10.1% ■Transportation equipment up 12.9%■Precision equipment down 11.0% ■Information and communications up 31.0%
Unit: million yen

Total: 4,974

5,000
4,500

Total: 4,513
230

Q2 FY2023

203
371

339

4,000

Q2 FY2024

ResultRatio

ResultRatio(millionyen)(%)(millionyen)(%)

Changefrom theprevious
year

Percentage
variance

(%)

(pt)

Steel, nonferrous
materials andmetals

230

5.1

203

4.1

▲11.5

▲ 1.0

Machinery

339

7.5

371

7.5

9.3

▲ 0.1

Electricalequipment

1,310

29.0

1,443

29.0

10.1

▲ 0.0

Transportationequipment

1,589

35.2

1,795

36.1

12.9

0.9

1,500

Precisionequipment

482

10.7

428

8.6

▲11.0

▲ 2.1

1,000

Information andcommunications

460

10.2

603

12.1

31.0

1.9

Miscellaneous

99

2.2

128

2.6

28.2

0.4

4,513

100.0

4,974

100.0

10.2

1,443

3,500
1,310
3,000
2,500

1,795

2,000

1,589

482
500
0

99

460

428
603

128

Total
Q2 FY2023

Q2 FY2024―*Excludes sales from "Other" businesses.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

18

2

Financial summary for Q2 FY2024

Net sales by business field for Q2 FY2024■Embedded / Model-Based up 22.4% ■IT Solution up 15.2%■Electronics up 2.9% ■Machinery up 4.6%
Unit: million yen

Total: 4,974

5,000
4,500

Q2 FY2023

Q2 FY2024

Total: 4,513

ChangePercentfrom theageprevious
varianceyear

ResultRatio

ResultRatio(millionyen)(%)(million
yen)

(%)

(%)

Embedded /Model-Based

1,280

28.4

1,567

31.5

22.4

3.1

IT Solution

445

9.9

513

10.3

15.2

0.4

Electronics

1,291

28.6

1,329

26.7

2.9

▲ 1.9

Machinery

1,496

33.2

1,564

31.5

4.6

▲ 1.7

Total

4,513

100.0

4,974

100.0

10.2

―

1,567
4,000

(pt)

1,280
3,500
3,000

445

513

2,500
2,000

1,291

1,329

1,500
1,000
1,496

1,564

500
0
Q2 FY2023

Q2 FY2024*Excludes sales from "Other" businesses.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

19

2

Financial summary for Q2 FY2024

Net sales by region for Q2 FY2024■Kanto up 12.7% ■Tokai up 8.6% ■Kinki down 0.6%
Unit: million yen

Total: 4,974

5,000
4,500

Q2 FY2023

298

Total: 4,513
263

4,000

Q2 FY2024

ResultRatio

ResultRatio(millionyen)(%)(millionyen)(%)

ChangePercentfrom theageprevious
variance
year
(%)

(pt)

Tohoku

263

5.8

298

6.0

13.1

0.2

Kanto

2,609

57.8

2,941

59.1

12.7

1.3

Hokuriku

16

0.4

21

0.4

32.7

0.1

Tokai

789

17.5

857

17.2

8.6

▲ 0.3

Kinki

723

16.0

719

14.5

▲ 0.6

▲ 1.6

Chugoku

65

1.5

80

1.6

21.5

0.1

Kyushu

45

1.0

56

1.1

25.0

0.1

Total

4,513

100.0

4,974

100.0

10.2

3,500
2,941
3,000

2,609

2,500
2,000
1,500

21

16
789

857

723

719

1,000
500

65

80
56

45
0
Q2 FY2023

Q2 FY2024―*Excludes sales from "Other" businesses.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved20

2

Financial summary for Q2 FY2024

Stance on engineer dispatching business net sales, expenses,
and improving margin percentages■Net sales

Number ofoperative personnel

Number ofengineers×■Cost of sales

Utilization
rate

×Unit priceofengineers

×

Total work
personhours

Labor costs, etc. of engineers assigned to client companies■SG&A expenses ・(Standby) labor costs incurred during internal education andtraining, labor costs of administrative staff positions
・Hiring activity expenses

Two key points to improving margin percentages[Improving gross margin]
Increase average unit price of engineers.
[Improving operating margin]
Minimize addition of administrative staff entailed by the increase inengineers through improved administrative efficiency, and thereby
suppress increase in the SG&A expense ratio.
Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved21

2

Financial summary for Q2 FY2024

Engineer hires for FY2024 / turnover rate
Weight given to
students in softwareand electronics fields

Newly graduated engineers
Joined in April

250
200

Joined in October

3

150

220
204
2

177
5

156

100

169
3

202

153

172

FY2020

FY2021

Unit: people

128

166

128

50
0

Turnover rate
All

11.7

11.3

8.9

7.1

FY2024FY2025（est.）（proj.）

Career engineers

Unit: people
180

200
150

9.6
100

7.3
10.8

5.0

FY2023

Unit: %

Excluding retirement and turnover via the Company’s
assistance program to change jobs

15.0

10.0

FY2022

10.3
7.7

50

5.9

26

32

29

35

50
32

0

0.0
FY2019FY2020

FY2021

FY2022

FY2023

FY2019FY2020

FY2021

FY2022

FY2023

FY2024（proj.）

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

22

2

Financial summary for Q2 FY2024

Term-end engineer count / utilization rate for Q2 FY2024
Term-end engineer
count

Q2 FY2023 (average)

Q2 FY2024 (average)(people)1,156

Unit: people

1,400
1,200
1,000
800
600
400
200
0

1,216

1,192

1,182

1,212
1,157

FY2023End of Q1(Apr.)

98.3

98

End of Q2(Jul.)*Based on the numberof dispatched engineers

End of Q3(Oct.)

97.0

End of Q4(Jan.)

1,237

1,249

End of Q1(Apr.)

Q2 FY2023 (average)

Q2 FY2024 (average)

97.6

98.1

98.5

98.5

Q2
32 careerengineers
joined98.4

End of Q2(Jul.)

Change from theprevious year (pt)

0.5
97.8

Recovery trend
in the demandfor engineers

96
94
90

4.8

FY2024

Unit: %

92

56
April 2023
130 newly
graduatedengineers joined

Utilization rate
100

Change from the
Change from theprevious year
previous year (%)

FY2024FY2023End of Q1(Feb. to Apr.)

End of Q2(May. to Jul.)End of Q3(Aug. to Oct.)

End of Q4(Nov. to Jan.)End of Q1(Feb. to Apr.)

End of Q2(May. to Jul.)*New employees and others who joined the Company mid-year are not included in the utilization rate until after they are dispatched to their assignments.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved23

2

Financial summary for Q2 FY2024

Unit price of engineers / total work man-hours for Q2 FY2024
Unit price of engineers

Q2 FY2023 (average)

Q2 FY2024 (average)

Change from the
Change from theprevious year
previous year (%)(yen)*Figures for dispatched engineers *Per person

4,186

4,296

110

2.6

Unit: yen / hour

4,400

4,334

4,350

4,258

4,300
4,250
4,200
4,150
4,100

4,203

4,170

4,211

Due to the trend of engineer
shortage, the unit price for newly
graduated engineers at their firstassignments is on the rise

FY2023End of Q1(Feb. to Apr.)

FY2024End of Q2(May. to Jul.)

Total work personhours
Unit: hour / month172

End of Q4(Nov. to Jan.)Q2 FY2024 (average)

169

169

GoldenWeekholidays

166

170

End of Q3(Aug. to Oct.)

Q2 FY2023 (average)*Figures for dispatched engineers *Per person

180

4,207

Summerleave

163

New Year’s
holidays

End of Q1(Feb. to Apr.)

End of Q2(May. to Jul.)

Change from the Change from theprevious year (h) previous year (%)

0

172

0.3

166

161

160
150

FY2023End of Q1(Feb. to Apr.)

FY2024End of Q2(May. to Jul.)End of Q3(Aug. to Oct.)

End of Q4(Nov. to Jan.)End of Q1(Feb. to Apr.)

End of Q2(May. to Jul.)

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

24Investment Highlights

1

The ninth consecutive period of sales and profit growth,double-digit growth

p. 3

2

Financial summary for Q2 FY2024

p. 13

3

Progress toward achieving the Prime listing criteria

p. 25

4

Stable and continuous dividend payments

p. 39

5

Reference

p. 43

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved25

3Progress toward achieving the Prime listing criteria

Progress toward achieving the Prime listing criteria■Compliance with the listing maintenance criteria of the Prime Market

Listing maintenancecriteria

The Company

As of transition
standard dateof June 30, 2021

Latest data

Not met as of transition
standard date (June 30, 2021)

Number of
tradable shares

Tradable sharemarketcapitalization

20,000 units

10 billion yen

35% 20 million yen

49,748 units

4.1 billion yen

46.8% 28 million yen

72,893 units 124 billion yen

68.6% 91 million yen

The ratio oftradable shares

Average daily
trading value（As of Jul. 31, 2023） （As of Sep. 7, 2023） （As of Jul. 31, 2023）（As of Jul. 31, 2023）■Medium-Term Business Plan period
Various efforts will be made to meet the listing maintenancecriteria of tradable share market capitalization in the lead-up to
FY2025, the final year of the Medium-Term Business Plan.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved26

3

Progress toward achieving the Prime listing criteria

KPI requirements for compliance with tradable share market
capitalization / Status
KPI requirements / Actual
The ratio oftradable shares

As of transition
standard date ofJune 30, 2021

As ofJul. 31, 2023

Requirement

46.80%

68.6%

70%

Number of
4,974,000
tradable sharesshares7,289,000 7,439,000
shares

As of transition
standard date ofJune 30, 2021

As ofSep. 7, 2023

Requirement

Price earnings
ratio (PER)

12.7 times 19.7 times 15.0 times

Earnings per
share (EPS)

68.59 yen 86.65 yen 93.34 yen

Stock price858 yenshares（est.）

1,705 yen 1,400 yen

Apr. 2022
Secondary offering
Tradable share market capitalization

As oftransition
standard Date

41billion yen

As ofSep. 7, 2023

124
billion yen

Requirement

10

billion yen

Status
As of September 7, 2023, tradable share market capitalization increased by 202.4%
from that as of the transition standard date. Stock price increased 98.7%.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved27

3

Progress toward achieving the Prime listing criteria

Measures to achieve the KPI requirements, their evaluation,and future issues■Increase the ratio of tradable shares
Secure a certain number of tradable shares through liquidation of shares held by existing
shareholders, e.g., discuss with major shareholders on the sale of shares.
⇒ April 2022: Conducted a secondary offering and increased the ratio to 68.6%■Increase earnings per share (EPS)1

Aim to expand the scale of our business by building an internal system ofrecruitment, training, and sales with carbon neutrality as a main pillar of ourbusiness activities

2

Conduct M&As and other activities to acquire new technical fields ofexpertise (e.g., chemistry, civil engineering and construction)⇒ Up 22.8% year-on-year. Continue to aim for 93.34 yen.
■Increaseshareholder returns
To beconsidered

Payout ratio

Total return ratio

Based on 30%

Raise to 50%⇒ Implemented since FY2022

Share buyback⇒ Consider as appropriate based on the situation■Improve capitalefficiency

Return On Equity (ROE)Over 20% (aim for FY2018 actual 26.9%)⇒ 23.5% Aim to set a new highCopyright(C) 2023 Artner Co., Ltd. All Rights Reserved28

3

Progress toward achieving the Prime listing criteria

Measures to achieve the KPI requirements, their evaluation,and future issues (IR)■Strengthen information dissemination for individual and institutional investors
Hold briefings for individual and institutional investors (online or in-person)(for individual investors: twice a year ⇒ 3 to 4 times a year; for institutional investors
and analysts: once a year ⇒ twice a year)
One-on-one meetings with institutional investors (phone or online)⇒ Planned number held in FY2023. Awareness increased (survey).
Continue to hold the same number as in FY2023.

■Increase English-language disclosures with foreign investors in mind
The main pages of our website, Convocation Notice, Corporate Governance Report,
Summary of Non-consolidated Financial Results, etc.

⇒ In FY2023, English-language disclosures were implemented as planned.
Continue to make similar disclosures as in FY2023.

■ Adapt to the Corporate Governance Code (ver. June 2021)⇒ Making TCFD disclosures, etc. since FY2023.
Continue to make disclosures with corporate governance in mind.

■Disseminate non-financial information
Prepare Annual Report
Promote information dissemination with ESG evaluation organizations in mind

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved29

3

Progress toward achieving the Prime listing criteria

Medium-Term Business Plan (fiscal year ending January 31, 2023
to fiscal year ending January 31, 2025)
Basic policy"Build a foundation for sustainable and next-generation growth""Make Value for 2022 to 2024"
Basic Measures

Promote diversity andinclusion in talentmanagement

1 Promote strategies bysegment2•

Develop strategies for each segment(recruitment – education –assignment – system)•

Utilize workers of retirement age,
women, and foreign workers(overseas students) as personnel•

Establish approaches to markets bysegment••

Explore and seek new specialist fieldsof technology

Utilize and organize partnercompanies (set up a contracting
system)Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved30

3Progress toward achieving the Prime listing criteria

Artner's approach to sustainable growth and next-generation growthAs our social environment continues to change on a global scale, dealing with social issues,
such as initiatives based on the recommendations from the Task Force on Climate-related
Financial Disclosures (TCFD), is an important managerial agenda

Build an internal system of recruitment, training, and sales with carbon
neutrality as a main pillar of our business activities
Contribute to solving social issues through our business activities, increasing our corporate value
and returning profits to stakeholders
Build a foundation for sustainable growth and next-generation growth
Direction of our carbon neutrality initiatives
For our major customers in the automotive industry, etc.
Participation by our engineers in development projects related to electricvehicles (EVs) that do not emit CO2 when driven, fuel cell vehicles (FCVs),
infrastructure (charging infrastructure, hydrogen stations), automateddriving, semiconductors, etc.
Aim for further development and market penetration

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved31

3Progress toward achieving the Prime listing criteria

Our recruitment, training, and sales efforts with an eye tocarbon neutrality
Recruitment

Recruitment ● Students who have graduated from departmentsin the fields of electricity, electronics, materials
targets
science, energy, and information technology● Experienced workers with skills and experiencein the fields above

In order to recruit more talents that match client needs, we arecommitted to changing our recruitment policy, which is heavily
focused on new graduates. ⇒ Balance the numbers of new
graduates and career hires to secure optimum talents

Training

Training
details

Share of carbon neutrality recruitment targets
for new graduates and career hires

FY2025(target)FY2023New
graduates

55.0%

46.1%

Career
hires

55.0%

62.0%

● Understanding the principles of power systems (inverter systems) for EVs and FCVs
● Optimization of infrastructure resources and AI/machine learning for human and product transactions
through the introduction of cloud computing● Model design and validation of EV battery management systems● How to analyze the results of sensor characterization● Recycling of chemicals and materials

Meet the ever-increasing needs of engineers in the software,electrical and electronic fields.⇒ Increase trainers

Sales

Placement in carbon neutrality projects
Contribute to solving social issues to improvebusiness performance
Increase the unit price of engineers by approximately 10%
compared to other projects⇒ Increase net sales and profit margins

Share of engineers placed in carbon
neutrality projects among all engineers

FY2025(target)FY2023

50.0%

46.1%

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved32

3Progress toward achieving the Prime listing criteria

Medium-Term Business Plan Correlation diagram of earnings andsales targets and key indicators* □⇒□… (FY2023) ⇒ (FY2025) figures

130 ⇒ 220
(Up 69.2％)

Number ofcareer hires

50 ⇒ 200(Up 300.0％)

Turnoverrate

9.6% ⇒ 8.3%

(Down 1.3pt)

Gross margin

Number of engineers

Number of new
graduates

1,157 ⇒ 1,600 (Up 38.3％)

×Share of engineers placed in carbon
neutrality projects among all engineers

46.1% ⇒ 50.0%
Increase the unit price of engineers
by approximately
10% compared to other projects

33.3% ⇒ 37.6% (Up 4.3pt)

Utilization
rate

＋

×

Total work
person-hours¥ 9.2 billion⇒ ¥ 11.6 billion (Up 26.1％)

Operating margin

Net sales×

Unit price ofengineers

Recruitmentcost¥ 320 billion ⇒ ¥ 660 billion

Ratio of recruitment
cost to net sales

3.5% ⇒ 5.7%(Up 2.2pt)

12.9% ⇒ 14.0%（Up 1.1pt）

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved33

3

Progress toward achieving the Prime listing criteria

Numerical business targets <FY2025 (final year) key indicators>
Number ofengineers

1,600

As of year-end / Unit: people
Dispatched :Contracting

1,600

Recruitment of
new graduates :Career hires

1:1

9:1

1,600

1,400
1,200

1,073

1,000

901

800
600

543

569

FY2014FY2015

601

654

716

1,157

971

785

400
200
0
FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

FY2023

FY2024FY2025（proj.）

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved34

3

Progress toward achieving the Prime listing criteria

Efforts to reach 1,600 engineers
Recruitment of new
graduates

FY2024 forecast

Recruitment
activities

Career hires
FY2024 forecast

Recruitment
activities

Target for April 2024 hires: 220 engineers(up 69.2% from 130 engineers in the preceding year (forecast))

Staff

Up 35.7%

Investment
expenses

Up 48.3 %Request university professors to introduce students to Artner (regularly visit science and engineering universities in Japan,
actively visit schools whose graduates we have previously hired)
Hold university laboratory seminars (in-person, online) by our engineers who are alumni of that university
Utilize web media, exhibit at off-campus joint company information sessions, exhibit at events for international students
Utilize employment agencies, utilize employee referral system
Build relationships with university professors and university career centers through industry-academia collaboration (participationin academic societies, part-time lecturers at universities, etc.)
Conduct internships (increase name recognition, increase applications by students who have begun job hunting)Target for FY2024 hires: 180 engineers(up 260% from 50 engineers in the preceding year)

Staff

Up 71.4%

Investment
expenses

Up 112.5%

Actively hire year-round not only people with experience but also talented non-recent graduates with no experience
Utilize employment agencies, utilize web media, utilize employee referral system, utilize “Hello Work” employment service
Exhibit at job fairs
Establish a career hire recruitment website
Increase the number of staff and enhance their skills to improve the job offer acceptance rate

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved35

3Progress toward achieving the Prime listing criteria

Efforts to reach 1,600 engineers
PR content across all
recruitment activities
Provision of jobs and an enabling environment
We will provide engineers with good jobs and a good training environment, and we will further enhance ourbenefits including a secure salary. We will offer career paths and skill improvement plans.

Job-based employment
We have projects for upstream, midstream, and downstream processes. By joining the Company, starting
careers from midstream, and transitioning projects, employees can complete their career advancement to
upstream internally.

Emphasizing the job change assistance program to differentiate from other companies inthe same industry
In a survey for new hires, approx. 80% responded that they found our job change assistance program to be“attractive.”
The program works to our favor when employee candidates compare the Company with other companies inthe same industry.

Improving the turnover rate
During the COVID-19 pandemic, the number of engineers returning to Artner for training after projects werecompleted increased from previous years, resulting in a higher turnover rate. However, with the recovery fromthe pandemic, the turnover rate is expected to improve to the previous years’ level.
Sales representatives will visit engineers regularly or conduct online interviews to maintain close communication.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved36

3Progress toward achieving the Prime listing criteria

Business environment forecast
Fiscal year ending
January 31, 2024
(forecast)Fiscal year ending
January 31, 2025
(planned)

Medium-TermBusiness Plan
(2nd year)

Medium-TermBusiness Plan
(final year)

Perceived
engineer shortage

Expected to persist

Post-COVID
normalization

Living with
COVID

Key subjects andindustries

Carbon Neutral, Automobile industry,
Semiconductor Industry

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved37

3

Progress toward achieving the Prime listing criteria

Progress of the Earnings Forecast for Q2 FY2024■Q2 progress rates on full-year forecast of financial results:

Net sales 51.1%, operating profit 66.5%, ordinary profit 66.5%, profit 67.1%* Despite only 32 career hires in Q2 (180 career hires planned for the full year), we still expect to achieve
our forecast due to increases in the unit prices of engineers and the assignments of newly graduatedengineers progressing ahead of schedule.

Unit: ¥ million

10,0009,797

Q2 FY2024
Result(¥ million)

9,000

% of
Net sales

Progress rate
on full-year
forecast
(%)

8,000

Net sales
OperatingprofitOrdinary
profitProfit

7,000
6,000
5,000
4,000

5,006
1,325

1,328

1,000

Net sales

920

882

882

617

OperatingprofitOrdinary
profitProfit0
Net sales

100.0

51.1

882

17.6

66.5

882

17.6

66.5

617

12.3

67.1

Earnings Forecast for FY2024
Result% of(¥ million)
Net sales

3,000
2,000

5,006

OperatingprofitOrdinary
profitProfit

9,797

100.0

1,325

13.5

1,328

13.6

920

9.4

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

38

Investment Highlights

1

The ninth consecutive period of sales and profit growth,double-digit growth

p. 3

2

Financial summary for Q2 FY2024

p. 13

3

Progress toward achieving the Prime listing criteria

p. 25

4

Stable and continuous dividend payments

p. 39

5

Reference

p. 43

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

39

4

Stable and continuous dividend payments

FY2024 Dividend per share
Payout ratio

Based on 50%

FY2024 (forecast) 80.2%■This year’s interim dividend revised to 37.5 yen, up 5.5 yen from the previous
forecast. Year-end dividend (planned) 32 yen, annual dividend (planned) 69.5
yen (up 9.5 yen YoY)
Annual dividends per share(yen)

Dividend
yield
(%)

Total

Commemorative
dividends

Total

23.00

43.00

17.00

60.00

32.00

69.50

Secondquarterend

Fiscalyear-end

FY202320.00

FY2024(forecast)

37.50

Payout Dividend
ratio
on equity
(%)
ratio
(DOE)
(%)

6.02

71.2

3.80

80.2

16.7

*Dividend yield (%) = individual dividend per share (total) ÷ share price (year-end, closing price) × 100

Closing value at ending of FY2023 (January 31, 2023) 997 yen / Closing value at ending of Q2 FY2024 (July 31, 2023) 1,828 yen

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved40

4

Stable and continuous dividend payments

Dividend per share■We intend to increase our profit every year and determine a dividend amount thatwill not fall below the previous year’s amount, based on a payout ratio of 50%.

Unit: yen

70
65
60
55

Celebrates the 60th
anniversary of its
founding. The 15th
anniversary oflisting on JASDAQ(now Prime Market)

Ordinary dividend (interim)
Ordinary dividend (year-end)
Commemorative dividend

50

40
35
30

Celebrates the 55th
anniversary of its
founding. the 10th
anniversary oflisting on JASDAQ(now Prime Market)

25
20
15
10

0

60.00

17.00

32.00

Payout ratio rose to
50%

45

5

69.50

Dividend increased for the ninth consecutive period

5.00

6.25

2.50
2.50

3.75
2.50

FY2014FY2015

8.75
5.00

11.25
6.25

Stock listing moved
up to the First
Section of the Tokyo
Stock Exchange inJuly 2018.

34.50
23.00

23.00
20.50
15.00
1.00
7.50

18.00
2.50

10.50

Dividyen forecastend
up by 5.50 fromprevious of 32.00 yen

20.50
37.50

11.50

8.00

3.75

5.00

6.50

7.50

FY2016FY2017FY2018FY2019

10.00

11.50

FY2020

FY202114.00

FY202220.00

FY2023

FY2024(est.)

Dividends per share were retroactively revised to factor in the impact of stock splits conducted as follows.
February 1, 2017 (2-for-1 stock split) •April 1, 2018 (2-for-1 stock split)

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

41

4

Stable and continuous dividend payments

Numerical business targets <FY2025 (final year) key indicators>

ROE
30.0
25.0
20.0
15.0
10.0
5.0
0.0

26.9

FY2018

Payout ratio
90.0
80.0
70.0
60.0
50.0
40.0
30.0
20.0
10.0
0.0

20% or more

(Aim to achieve FY2018 actual level of 26.9%)
Unit: %

25.2

24.2

FY2019FY202021.5

21.7

FY2021

FY2022

50% or more

23.5

FY2023

Unit: %

80.2
71.2
50.3
33.1

35.4

35.5

FY2018FY2019FY202038.9

FY2021

FY2022

FY2023

FY2024(est.)

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

42Investment Highlights

1

The ninth consecutive period of sales and profit growth,double-digit growth

p. 3

2

Financial summary for Q2 FY2024

p. 13

3

Progress toward achieving the Prime listing criteria

p. 25

4

Stable and continuous dividend payments

p. 39

5

Reference

p. 43

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

43

5

Reference

Company Motto / Management Philosophy / Origin of the Company Name
Corporate Logo

Company Motto
Pursuit of Mindset

Pursuit of Wisdom

Pursuit of Creativity

Management Philosophy“Engineer Support Company”—We support our engineers’ dreams—
We aim for the happiness of all the employees and reflection within the company
by developing talents, fostering technologies,
and contributing to society through our engineers.

Origin of the Company Name
Art: Pursuing
superior quality

Partner: Responding tocustomer trust

Corporate Logo

Our corporate logo was designed with a motif of shimmering water droplets that evoke fresh andclear ideas with a futuristic taste. Each droplet also represents our proud engineers individually,
forming an “A (Artner)” that stands for a group of excellent talents. Furthermore, each opening of
the droplets signifies our open-mindedness to freely incorporate and disseminate different ideas.
Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

44

5

Reference

PurposeSupport the growth and self-actualization of engineers,
who are Japan’s world-class assets.
For resource-poor Japan, its engineers are assets, of which we can boast to the world.
Artner is a platform that supports the growth andself-actualization of engineers.
Artner nurtures engineers not only as assets of Artner,
but also as shared assets of Japan.

Amid a rapidly changing work environment and mindset,
attributed to the fluidity of talents and various diversity initiatives, Artner is committed topromoting the happiness of working engineers to create “a new way of life” for them.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved45

5Reference

To Achieve Our Purpose

MissionAs an “Engineer Support Company,” we are committed tocreating “a new way of life” for engineers.

VisionWe will improve the quality of our engineers to become,within 10 years, a group of engineers providing the greatest
added value in the industry. The talents developed byArtner will support the world of manufacturing.

ValuesCompetent engineers are capable of selecting what theyneed, and making every effort to attain happiness forthemselves. Artner supports the career and skill
development of each and every engineer to offer a wide
range of projects that fit with their desires and qualifications.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

46

5

Reference

Business Model■Hire undergraduate, graduate, technical, and professional students in the sciences (engineering, scienceand engineering, science, information engineering) as regular employees. After receiving education andtraining, they are placed with our clients or the Company’s teams■Our training staff are engineers with extensive experience■Our clients include transportation equipment, electrical equipment, precision equipment manufacturer, andinformation and communications companies

Engineer
Dispatching

Hire
regularemployees

Providetechnical
services

EducationandTraining

Contracting
Placed in
Artner’s
project
team

Deliver
outputs toour clients

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

47

5

Reference

Employment status at Artner■Artner’s engineers with an “indefinite employment dispatch” status are
hired as regular employees, meaning that the employment relationshipcontinues even after a dispatching service ends.

Dispatch period

Artner Co., Ltd.

Fixed-term
employment
dispatch

Employment relationshipcontinues as engineers are
regular employees

Dispatch period

Dispatching service
ends

Indefinite
employment
dispatchEngineers start working at their next
manufacturer assignment.
In between assignments,

engineers enhance their skills through training
while receiving a salary.

Employment
relationship ends
Common idea that many people
associate with dispatch
employment
Unstable Irregular employment
Frequent transfers
Hard labor Low wages

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

48

5

Reference

Business fields
Software

Electronics

Machinery

Compatible fields

Compatible fields

Compatible fields

Embedded
IT Solution
Model-BasedElectrical Equipment
Electronic Circuits
Electronic Devices

Drive Systems
Mechanisms
Structures and Materials

Software engineers develop
software to be embedded in
IoT devices and application
software for network systems.

Electronic engineers design thecircuit boards that form theheart of equipment and devices
and they conduct reliability
assessments of such systems.

Mechanical engineers design
the mechanisms of machineswith moving parts using 2D/3D
CAD tools.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved49

5

Reference

Our clients (by industry, in alphabetical order, standard company name used)■Business with client companies in a wide range of industries for stable businessTransportationequipment

BOSCH, Honda Motor, Nissan Motor, SUBARU, TOYOTA MOTOR, etc.

Electronic
devices

Lasertec, OMRON, Panasonic Holdings, Tokyo Electron, etc.

Precisionequipment

NIKON, SHIMADZU, Terumo, etc.

Machinery

JTEKT, Komatsu, SMC, etc.

Information andcommunications

Hitachi Hi-System21, etc.

Companies listed on the first and second sections of their respective stock exchange,
as well as blue-chip, mid-sized companies
Transaction history with roughly 1,000 companies
Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved50

5Reference

Top ten corporate clients by net sales in FY2023■Top ten by net sales (Standard company name used)
FY2022

1
2
3
4
5
6
7
8
9
10

FY2023

Our clients

Segment

Our clients

Segment

Honda R&D Co., Ltd.

Honda Motor Co., Ltd.

Honda Motor Co., Ltd.

Transportationequipment
Transportationequipment

Honda R&D Co., Ltd.

Transportationequipment
Transportationequipment

Nikon Corporation

Precision equipment

Nikon Corporation

Precision equipment

Sumitomo Electric Industries, Ltd.

Steel, nonferrous
materials and metals

Terumo Corporation

Precision equipment

Terumo Corporation

Precision equipment

Sumitomo Electric Industries, Ltd.

Steel, nonferrous
materials and metals

Panasonic Corporation

Electronic devices

Tokyo Electron Miyagi Ltd.

Electronic devices

Tokyo Electron Technology Solutions Limited

Electronic devices

Bosch Corporation

Transportationequipment

Tokyo Electron Miyagi Ltd.

Electronic devices

Lasertec Corporation

Electronic devices

JTEKT CORPORATION

MachineryTokyo Electron Technology Solutions Limited

Electronic devices

CHUBU TOSHIBA ENGINEERING CORPORATIONElectronic devices

SMC Corporation

Machinery■Net sales per 10 companies
FY2022
Result

3,765
1,139
778

% of
Net sales
46.6
14.1
9.6

2,405
8,089

(¥ million)

Top 10
Top 11 to 20
Top 21 to 30
Other than the
above
Total

FY2023Result

4,161
1,329
884

% of
Net sales
45.2
14.4
9.6

29.7

2,832

100.0

9,208

(¥ million)

Change fromthe previous
year
（%）

Percentage
variance

（pt）

10.5
16.7
13.6

(1.4)
0.4
(0.0)

30.8

17.7

1.0

100.0

13.8

―

*Excludes sales from "Other" businesses.
Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved51

5

Reference

Internal programs that can be chosen by engineers

Performancebased salarysystemThe HV Group is responsible for the top-secret, high-level
design and development projects of different
manufacturers under a performance-based, generous
salary system.

Limited areasystemEngineers with three years of work experience (from thefourth year of their career) can limit their area of work toeither the Kanto, Chubu, or Kansai region.

Internal
recruitment
programEngineers may switch their affiliation between the HVGroup and the WV Group, or between the WV Group andthe PV Group.

Job change
assistanceprogramIf the engineer wishes to change jobs and theclient/manufacturer to which the engineer is placed wishes to
officially hire the engineer, we support their career change.
We also provide support for engineers who wish to return totheir hometowns to work.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved52

5Reference

What is the job change assistance program?

Basic policy

Benefit toour clients

The program respects the choices made by our engineers, whether they choose
to develop their careers as regular employees of the Company or go work at ourclient to challenge themselves in a new world.

Benefit toour engineers

Benefit to
ArtnerRecruitment

Clients can assess
the abilities of Artner
engineersduring theirplacement period(3 to 5 years) before
hiring them.

Engineers cangain experienceand develop theirskills at Artnerand have theirabilities be evaluatedby clients basedon their actual
onsite work.

The program encourages students who wish towork at a manufacturer but
had little interest in engineer dispatching
services and did not consider joining Artner tobecome interested and decide to join
the Company upon comparing it
With other companies.

Sales
If engineers from Artner are successful after
changing jobs, the reputation of “Artner’s former
employee” will improve.
Such engineers will further strengthen
the relationship between the Company andour clients.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved53

5Reference

Career paths of engineers■We offer various career paths for engineers, such as “to hone their skills in a high-level
environment and earn high compensation,” “to work in a particular region,” “to eventually
return to work in their hometowns,” and “to shift to employment with a manufacturer.”

Entry into theCompany

Education andtraining

Placement

High ValueGroup

Retirement age

Continued employment
programExpertManagerial
position

Wide ValueGroup

Training manager

Product ValueGroup

Job change
assistance program

Job change

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved54

5

Reference

Business locations
Headquarters

Tokyo, Osaka

Business bases

Yokohama, Utsunomiya,
Osaka, Nagoya

Learning centers

East Japan, West Japan

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved55

5Reference

Education and training flow
■After entering the Company, employees undergo a process of “general training,” “outside on-the-job
training,” “basic training,” and “customized training (practical training)” before their assignment to a
manufacturer’s project. After being assigned, employees take the “career support courses” todevelop their ability to provide services tailored to our clients.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved56

5Reference

Industry-academia collaboration■Deepening industry-academia collaboration by combining universities’ advanced technologies andArtner’s practical skills.

Lectures at universities
Our training staff give practical lectures atuniversities as part-time lecturers and seminar
lecturers.

Collaboration with academic societies andorganizations

We present papers at affiliated academic
societies and organizations. We are deepening
our friendship with members of universities.
● Japan Society for Graphic Science● Japan Society for Design Engineering● The Japan Society of Mechanical Engineers● The Institute of Electrical Engineers of Japan, etc.

Publication of educational materials
With the cooperation of companies anduniversities, we have put together books on
the training know-how that we have accumulated,
and use the books in our education and training.

Skill development papers
Our training systems and outputs are made available
as papers to educational and business professionals.
The papers are used for developing a wide range ofhuman resources.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved57

5

Reference

Skill development seminars■The seminars are held by inviting lecturers from diverse fields. Participants acquire a range ofknowledge, not limited to specific technical fields, and develop their human skills.

TOEIC score improvement seminar●Learn how to acquire useful English by preparing for
TOEIC®

Seminar on next-generation businessskills needed in the new normal era●Our potential to design the future of the organization

Technological capability booster lectures
Around 10 times a year, outside lecturers sha
re technical information on various topics for
employees’ personal growth.
The seminars especially help those withpractical experience to develop criteria
for making effective use of
their experience.

●Strategy for developing China’s new technology
industries and 4K / 8K and 5G●Introduction to feature engineering
for data science●Introduction to contactless power transfer●IoT security●Analytical methods for thermal stress problems

Human skill enhancement seminar●Adapting to an era of diversity
Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved58

5

Reference

Career support courses■ Courses are offered in line with jobs and career levels to ensure employees possess the skills
required by the manufacturers with which they are placed.

Software skill development courses●Introduction to JavaScript●Introduction to MicroPython●Introduction to IoT Microcontroller ESP32●MBD engineers in the automobile industry●Practical algorithm development●Power window pinch detection

Electronics skill development courses
Even after being assigned to a
department, employees who areparticipating in a manufacturer’s project
receive training on technologies andproducts
in high demand, both as on-the-job andoff-the-job team training.

●Improving work efficiency using Excel VBA●Sequence control and production site

Machinery skill development courses●Basics of resin sheet metal design●Product conceptual design training●Fluid mechanics in our surroundings

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved59

5

Reference

Artner’s initiatives for achieving SDGs in the Medium-TermBusiness Plan■❝Carbon neutrality❞

Personnel for technicaldevelopment of eco cars

Participating in the “Fun to Share”
climate change campaign andprovidingEndorsed Task Force on Climaterelated Financial Disclosures(TCFD) recommendations■Promote diversity and inclusion in talent management
Diversity and LGBTQ initiatives
Improving the employment
environment to promote active
participation of women

Ensuring diversity and equal
opportunity in employment
Active hiring of people withdisabilities

Establishing a diversity
promotion office

Establishing a diversity promotion office
Diversity and LGBTQ initiatives

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved60

5Reference

Operating margin / ROA / earnings per share and net assets per share
Operating margin

Return on assets (ROA)

Unit: ％

40
30

27.3

26.3

20

25.3

22.1

21.7

22.4

12.4

12.7

12.4

12.5

12.9

FY2019FY2020

FY2021

FY2022

FY202311.8
100

FY2018

Unit: ¥

400
350
300
250
200
150
100
50
0

Earnings per share

Net assets per share

380.96337.14184.8145.26

219.5950.91

256.7757.73

293.93

59.16

68.59

84.24

FY2018FY2019FY2020
FY2021
FY2022
FY2023*Earnings per share and net assets per share were retroactively revised to factor in the impact of stock splits
conducted as follows.
April 1, 2018 (2-for-1 stock split)
Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved61

5Reference

Net assets / equity ratio

Net assets

Unit: ¥ million, ％Equity ratio

4,500
4,000

80.0
71.1

71.5

71.8

70.5

70.4

71.4
70.0

3,500

60.0

3,000

50.0

2,500
40.0
4,047

2,000
3,582
1,500
1,000

1,963

2,333

2,728

30.0

3,123

20.0
10.0

500
0

FY2018FY2019FY2020

FY2021

FY2022

FY20230.0

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved62

5Reference

Engineer breakdown by group / gross margin
Engineer breakdown■HV ■WV ■PV

100.0
80.0

17.0

Unit: ％

16.3

15.7

16.4

15.9

15.0

70.1

71.8

71.1

72.2

73.3

13.7

12.5

12.5

11.9

11.7

FY2019FY2020

FY2021

FY2022

FY2023

60.0
40.0

83.0

20.0
0.0

FY2018Gross margin(engineer dispatching services)

40.0
38.0

HV

32.0
30.0

PV

37.3

35.4

36.3
36.0

37.4
36.3
36.1

38.5
38.1
33.9

32.1
FY201832.8
FY2019

Unit: ％

39.4

ALL
全社

36.1

36.0
34.0

WV

32.2
FY2020

35.1
35.1
34.6
32.9
31.8

FY2021

FY2022

33.3
32.9
30.8

FY2023Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved63

5Reference

Quarterly (accounting period) financial results
Net sales■FY2023 ■FY2024

Unit: million yen

3,000
2,500

500

2,232

2,493

2,512
2,290

2,368

2,350

404

378

400

312

300

1,500

Unit: million yen

477

450
350

2,000

242

250

260

200

1,000

150
100

500

50

0

0

Q1

Q2

Ordinary profit

Q3■FY2023 ■FY2024

Q4

Unit: million yen

479

500

250

312

300

250

250

261

200
150

100

Q3

■FY2023 ■FY2024

Q4

Unit: million yen

333
284

263

241

216

200
150

100

Q2

Profit

300

403

379

350

Q1

350

450
400

Operating profit ■FY2023 ■FY2024

173

50

50
0

0

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved64

5Reference

Quarterly (accounting period) financial results, numerical data
FY2024
Q1
Result(million yen)

Q2

Percent
YOY
-age

*(1)

Result(million yen)

(%)

(%)

(%)

25.5

Q3

Percent
YOY
-age
(%)

(%)

*(1)

Result(%)(million yen)

Net sales

2,493

100.0

11.7

2,512

100.0

9.7

Cost of sales

1,528

61.3

10.2

1,587

63.2

5.6

Gross profit
SG&A
expenses
Operatingprofit

965

38.7

14.2

925

36.8

17.6

487

19.5

4.3

521

20.8

10.0

477

19.2

26.4

36.0

404

16.1

29.2

30.5

Ordinary profit

479

19.2

26.4

36.1

403

16.1

29.1

30.4

Profit

333

13.4

26.5

36.2

284

11.3

31.5

30.9

Q4

Percent
YOY
-age
(%)

(%)

*(1)

Result(%)(million yen)

Percent
YOY
-age
(%)

(%)

*(1)
(%)

25.6

*(1) Quarterly composition of full-year financial results

FY2023
Q1
Result(million yen)

Q2

Percent
YOY
-age

*(2)

Result(million yen)

(%)

(%)

(%)

Q3

Percent
YOY
-age

*(2)

Result(million yen)

(%)

(%)

(%)

Q4

Percent
YOY
-age

*(2)

Result(million yen)

(%)

(%)

(%)

Percent
YOY
-age

*(2)

(%)

(%)

(%)

11.6

25.4

Net sales

2,232

100.0

11.4

24.2

2,290

100.0

15.9

24.8

2,368

100.0

17.5

25.6

2,350

100.0

Cost of sales

1,387

62.1

15.9

22.5

1,503

65.6

17.3

24.4

1,666

70.3

24.0

27.0

1,611

68.6

8.8

26.1

Gross profit
SG&A
expenses
Operatingprofit

845

37.9

4.8

27.5

787

34.4

13.1

25.6

702

29.7

4.5

22.8

739

31.4

18.1

24.0

467

20.9

▲ 2.8

24.9

474

20.7

4.2

25.2

460

19.4

10.9

24.5

478

20.3

8.8

25.4

378

16.9

16.0

31.7

312

13.7

30.0

26.2

242

10.2

▲ 5.9

20.3

260

11.1

40.1

21.9

Ordinary profit

379

17.0

15.0

31.5

312

13.7

24.6

26.0

250

10.6

▲ 4.1

20.8

261

11.1

36.7

21.7

Profit

263

11.8

15.1

29.4

216

9.4

13.1

24.2

173

7.3

▲ 4.1

19.4

241

10.3

89.3

27.0

*(2) Quarterly composition of full-year financial results

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved65

5Reference

Data by owner category (As of July 31, 2023)
Share Distribution by Owner
Category
Unit: %
Financial institutions Financial instruments
business operators
6.76
2.88
Foreigncorporations, etc.
11.29

Other
corporations
27.55

Treasuryshares0.02

Shareholder Distribution by
Number of Shares Held
10,000and above
0.50
5,000
and above
0.50
1,000
and above
5.30

50,000and above
0.08

500
and above
5.22

Individuals
and other
51.50

Individuals and other
Other corporations
Foreign corporations, etc.
Financial institutions
Financial instruments business operators
Treasury shares

Unit: %
100,000
and above
0.10 500,000
and above
0.02

Under 100
36.81

100
and above
51.49

Under 100
1,000
and above
50,000and above100
and above
5,000
and above
100,000
and above500
and above
10,000and above
500,000
and above

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

66

5

ReferenceTerm-end shareholder numbers
Unit: people

14,00013,04413,00011,59512,00011,000

Apr. 2022
Secondary offering

10,000

9,723

9,000
Effective Apr. 1, 2018
Stock splits (2 for 1)

8,000
7,000
6,000
5,000

Effective Feb. 1, 2017
Stock splits (2 for 1)

4,000

3,474

3,000
2,000

3,373

3,527

3,630 3,521

3,662

Q2-FY2020

FY2020

FY2021

3,799

4,381

2,005

1,000
0

FY2018Q2-FY2019

FY2019Q2-FY2021

Q2-FY2022

FY2022Q2-FY2023

FY2023Q2-FY2024

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved67

5

Reference

Stock price changes (January 4, 2022 – September 7, 2023)
Jul. 24, 2023
Year high1,936 yen

2,000
1,900
1,800

Jun. 8, 2023
Announcement offinancial results forQ1 FY2024

1,700
1,600
1,500

Mar. 14, 2023
Announcement offinancial results for
FY2023

1,400
1,300
1,200
1,100

Apr. 2022
Secondary offering
Our public offering
price was 824 yen.

1,000
900
800
Jan.

Feb. Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep. Oct.

Nov.

Dec. Jan.

Feb. Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

68Handling of this document

Handling of this document
This document is intended to provide information to help you deepen your understanding of
the Company, and is not intended to solicit investment in securities issued by the Company.
Although this document has been created carefully to ensure its accuracy, its completeness is
not guaranteed.
The Company shall not be held liable for any failure or damage caused by the use of forecast
data or information contained in this document.
(Forward-looking statements)
The opinions, forecasts, and other information contained in this document are based on ourassessment at the time this document was prepared, and they may include potential risks anduncertainties.
Therefore, actual results may differ from the forward-looking statements in this document due
to various factors, such as changes in the business environment.
(Processing of numbers)
As the amounts in the text and figures of this document are rounded down to the nearest unit,
the total of breakdowns may not coincide with the official total numbers. In addition, as ratios(%) are rounded to the first decimal place, the total of their breakdown may not add up to
100.0%.

Copyright(C) 2023 Artner Co., Ltd. All Rights Reserved

69