COMPANY RESEARCH AND ANALYSIS REPORT

Terilogy Co., Ltd.
3356
TSE JASDAQ Standard

31-Jan.-2020
FISCO Ltd. Analyst

Yoshihiro Maeda

FISCO Ltd.
http://www.fisco.co.jp

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/■ Index■Summary---------------------------------------------------------------------------------------------------------------------------------------------------------------------------- 01
1. Company profile and business description. .................................................................................................

01

2. Results have bottomed-out, and profitability and the financial structure are improving . .............................

01

3. Expects to resume dividend payments in FY3/20 based on organic growth. ...............................................

02

4. Has added an M&A strategy to the organic growth,and is expected to announce a new medium-term management plan. .......................................................

02■Company profile---------------------------------------------------------------------------------------------------------------------------------------------------------- 03
1. An IT solutions provider that continues to meet the demands of the present age,with “No.1 in Quality” as its new slogan . ....................................................................................................

03

2. Expanded its business areas to broadband,
mobile, and security with the corporate IP network business as its original business . ...............................

04

3. Core competence is its ability to find “emerging technologies” and “marketable products”
and its “market response”............................................................................................................................

06■Business description---------------------------------------------------------------------------------------------------------------------------------------------- 07
1. Develops its business in four sections by products and services................................................................

07

2. Network Section..........................................................................................................................................

08

3. Security Section...........................................................................................................................................

09

4. Monitoring Section. . .....................................................................................................................................

09

5. Solutions Services Section.. .........................................................................................................................

10■Results trends--------------------------------------------------------------------------------------------------------------------------------------------------------------- 11
1. The FY3/19 figures show that results have bottomed-out............................................................................

11

2. Achieved higher sales and profits in actual terms in FY3/20 1H...................................................................

14■Outlook-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- 16
1. In FY3/20, expects to resume dividend payments based on organic growth. ..............................................

16

2. The Security Section is benefiting in advance of the mega event in 2020....................................................

18

3. Solutions Services Section is expected to build a new customer base........................................................

19

4. Expected to announce a new medium-term management plan with an M&A strategy
added to the organic growth.......................................................................................................................

We encourage readers to review our complete legal statement on “Disclaimer” page.

20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/██Summary
An IT solutions provider founded in the first year of the Heisei era.
Aiming to leap forward under the new slogan of “No.1 in Quality” in
the Reiwa era.
1. Company profile and business description
Terilogy Co., Ltd.<3356> (hereafter, also “the Company”) is an IT company that has been providing IP network-related
products and cutting-edge products and solutions in the network security field since it was founded in July 1989 (thefirst year of the Heisei era). Its corporate philosophy is “to respond to the needs of our customers and ensure their fullsatisfaction,” and in the Heisei era, it expanded its business areas to contribute to the construction and developmentof an Internet society under the slogan “In collaboration with customer” Today, in the Reiwa era, the Company isworking to provide solutions to meet the demands of the present age such as productivity improvements, work-stylereforms, and for inbound demand-related under its new slogan “No.1 in Quality.”
From the Company’s corporate history, it can be read that it has quickly ascertained the trends of broadband, mobile,and cybersecurity and expanded its business areas to them with the corporate IP network business as its original
business. Also, the Company considers its own strengths to be, 1) its ability to find “emerging technologies” and“marketable products” and its “market response,” 2) wide selection of customer solutions, 3) diverse service provision
approaches, 4) technical capabilities rooted in experience, and 5) global response capabilities. In particular, the firststrength listed above is used in its partnering strategy, which is a feature of the Company, and this is considered tobe the core competence on which all other strengths are based.
The Company is currently developing business activities in four sections by products and services; the Network
Section, the Security Section, the Monitoring Section, and the Solutions Services Section. Its features include thatit has established a 24-hours a day, 365-days a year maintenance system and an excellent distribution functionthat combines direct and indirect sales.
2. Results have bottomed-out, and profitability and the financial structure are improving
In the FY3/19 consolidated results, net sales increased 13.6% year-on-year (YoY) to ¥3,660mn, operating income
rose 47.0% to ¥244mn, and ordinary income grew 32.3% to ¥229mn. These strong figures suggest that results
have bottomed-out.
Looking at the financial indicators also, not only did recurring-type revenue reached its highest level in the last 10
years, but also cash and deposits and shareholders’ equity have greatly increased. In this situation, the indicatorsof financial stability, including equity ratio and the current ratio, are improving significantly. The Company has also
added a transfer of capital reserve, and retained earnings, which are normally the source of dividends, are at a levelat which resuming dividend payments is possible.

We encourage readers to review our complete legal statement on “Disclaimer” page.

01 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/

Summary

3. Expects to resume dividend payments in FY3/20 based on organic growth
For the FY3/20 consolidated results, the Company is forecasting increases in sales and profits in actual terms forthe third consecutive fiscal period, with net sales rising 12.8% YoY to ¥4,130mn and operating income growing
14.7% to ¥280mn, and it plans to resume dividend payments (a period-end dividend per share of ¥5). In thecurrent medium-term management plan, the targets for FY3/20 is net sales of ¥5bn and the resumption of dividend
payments, as business expansion through M&A and other means is expected. Even on looking only at the part fromorganic growth, the current situation is that it is implementing a growth strategy basically as planned and clearly
has in sight higher sales and profits and resuming dividend payments in FY3/20. Therefore, it is considered that theCompany should be positively evaluated to a certain extent.
4. Has added an M&A strategy to the organic growth, and is expected to announce a new medium-term
management plan
The Company has clarified that it will “implement measures for public relations and publicity activities toward
improving medium- to long-term and sustainable enterprise value, while also aiming to maximize enterprise value.”
At FISCO, we think it is highly likely that it will announce a new medium-term management plan in the spring of
2020, which is the final year of the current medium-term management plan.
In the new medium-term management plan, we can expect the Company to present an equity story that combines
a specific action plan to progress organic growth with an M&A financial strategy based on a highly convincing
financial strategy.
Key Points
An IT solutions company that has accumulated a track record in the 30 years since its foundation. The Company
is currently conducting business activities through four sections; the Network Section, the Security Section, theMonitoring Section, and the Solutions Services Section.
• It can be read to have a track record of accurately ascertaining the trends of the times and skillfully changing its
business focus areas to reflect them.
• Also utilizing its core competence, its ability to find “emerging technologies” and “marketable products” and its“market response,” in its partnering strategy• In FY3/20, expects to achieve higher sales and profits and to resume dividend payments based on organic
growth• Expected to present an equity story that combines a specific action plan to progress organic growth with an
M&A financial strategy in the new medium-term management plan, which is highly likely to be announced in thespring of 2020•

We encourage readers to review our complete legal statement on “Disclaimer” page.

02 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.

31-Jan.-20203356 TSE JASDAQ Standard

https://www.terilogy.com/english/

Summary

Results trend(¥mn)

Net sales (left)

4,500

4,130

4,000
3,221

2,639

2,500
2,000

300

244

2,434

500
400

3,660

3,500
3,000

(¥mn)

Operating income (right)

280

200
100

166

0

26

1,500

-100
-105

1,000

-200

500

-300

0

-400
FY3/16

FY3/17

FY3/18

FY3/19FY3/20 E

Note: Results are non-consolidated up to FY3/17 and consolidated from FY3/18 onwards
Source: Prepared by FISCO from the Company’s securities report and financial results██Company profile
An IT solutions provider that continues to meet the demands of thepresent age.
Introducing in-house developed products to respond to inbounddemand and to work-style reforms
1. An IT solutions provider that continues to meet the demands of the present age, with “No.1 in Quality” as
its new slogan
The Company is an IT company that has been providing IP network-related products and cutting-edge products
and solutions in the network security field since its foundation in July 1989. In December 2004, it was newly listedon the JASDAQ Securities Exchange (currently, the Tokyo Stock Exchange (TSE) JASDAQ).
Its corporate philosophy is “to respond to the needs of our customers and ensure their full satisfaction,” and in the
Heisei era, it expanded its business areas to contribute to the construction and development of the Internet society
under the slogan “In collaboration with customer” Today, in the Reiwa era, the Company is working to provide
solutions to meet the demands of the present age such as productivity improvements, work-style reforms, and for
related of inbound demand under its new slogan “No.1 in Quality.”

We encourage readers to review our complete legal statement on “Disclaimer” page.

03 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/

Company profile

2. Expanded its business areas to broadband, mobile, and security with the corporate IP network businessas its original businessLooking at the Company’s corporate history, it can be read that it has quickly ascertained the trends and expanded
its business areas to them with the corporate IP network business as its original business. These include 1) the
rapid shift from Internet communication using telephone lines and ISDN lines to high-speed Internet communication
using broadband lines, such as ADSL and FTTH, 2) the arrival of the mobile era against the backdrop of the spreadof smartphones, and 3) the increasing importance of cybersecurity in Internet society.
The Company’s corporate IP network business began in 1990 when it entered-into a distribution contract with
Wellfleet of the US and started to provide routers, which are one of the main products to build IP networks. Although
Wellfleet does not exist today, the company was acquired by Nortel (Canada), the world’s second largest computer
network device company at the time, to compete against Cisco Systems, Inc. <CSCO> of the US founded in 1984,
which was the largest company back then. The Company’s discovery of Wellfleet in 1990 can be said to be a good
example of its ability to find “emerging technologies” and “marketable products.” Currently, the Company is a supplierthat handles the routers manufactured by Cisco Systems.
In the broadband area, in 1999 the Company started to provide ADSL-connection software, and subsequently
it developed hit products with more than 10 million users, which became a bridgehead into a business for major
telecommunication companies. Also, in 1999, it concluded a distribution contract with Redback Networks of the US,
and through the introduction of broadband access servers and other products, it contributed to building the FTTH
networks of various electric power companies. Also, in mobile-related, it realized growth for DNS/DHCP appliances
manufactured by Infoblox Inc. of the US (devices to issue an IP address) and in-house developed solutions formonitoring networks have become its core products following the spread of smartphones. The Company was thefirst in Japan to conclude a distribution contract with Infoblox of the US, which was founded in 1999. Currently,
DNS/DHCP appliances manufactured by Infoblox are handled by major companies in Japan and have acquired
the position of being the de-facto standard, so this can also be evaluated as indicating the Company’s “foresight.”
In the Security field, the Company have provided wide-ranging solutions by concluding a domestic (Japan) master
reseller contract with TippingPoint of the US, when it was independent in 2004 (it was acquired by Hewlett-Packardof the US in 2010 and acquired by Trend Micro Inc. <4704> in 2015) followed by concluding reseller contracts with
OneSpan Inc. <OSPN> (formerly VASCO) in 2007, Lastline of the US in 2012, RedSeal of the US in 2015, Tempered
Networks of the US and KELA (Israel) in 2016, and Nozomi Networks of the US in 2018 (domestic (Japan) reseller
contract with Tempered Networks), which is enabling it to provide solutions over a wide range.

We encourage readers to review our complete legal statement on “Disclaimer” page.

04 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/

Company profile

Company history
July 1989

Terilogy Co., Ltd. established in Kanda, Chiyoda-ku, Tokyo. Enterprise networks business launched.

Apr. 1991

Maintenance outsourcing contract signed with Toshiba Engineering Corporation (now Toshiba IT-Services Corporation) andmaintenance service business launched.

May 1996

Outsourcing contract signed with Tokyo NTT Data Communication Systems Corporation (now NTT Data Business Systems
Corporation) and customer solutions business launched.

Nov. 1999

Distribution contract signed with American company Redback Networks, Inc. and broadband network business launched,encompassing sales of Redback Networks broadband access servers, Ethernet software from American company Network
Telesystems, Inc. (now Affinegy, Inc.), and other such products.

Jan. 2003

DNS/DHCP servers distribution contract signed with Infoblox Inc. of the US.

Oct. 2004

Domestic (Japan) master reseller contract signed with American company TippingPoint Inc. (now Trend Micro Incorporated.).

Dec. 2004

Listed on JASDAQ Securities Exchange.

Sep. 2005

Certified under ISO 27001 information security management system (ISMS) standards.

Nov. 2005

Basic agreement on business collaboration signed with UNIADEX, Ltd. based on capital tie-up agreement.

Dec. 2006

Domestic (Japan) master reseller contract signed with American company NETSCOUT (now NETSCOUT Systems, Inc.).

Feb. 2007

Distribution contract signed with Belgian company VASCO Data Security International, Inc.

Mar. 2007

Certified under ISO 14001 environmental management system (EMS) standards.

Oct. 2008

Distribution contract signed with Singaporean company eG Innovations Pte Ltd.

Apr. 2010

Following merger of JASDAQ Securities Exchange and Osaka Securities Exchange, Terilogy listed on Osaka Securities Exchange
JASDAQ.

Aug. 2010

Domestic (Japan) reseller contract signed with American company APCON, Inc.

Feb. 2011

Asia-Pacific distribution contract signed with American company SevOne, Inc.

June 2012

Sales begun of "momentum," a unique probe software product developed in-house at Terilogy.

Sep. 2012

Distribution contract signed with American company Lastline, Inc.

July 2013

Following merger of Osaka Securities Exchange and Tokyo Stock Exchange, Terilogy listed on JASDAQ (Standard).

July 2013

Fullflex ZG master reseller contract signed with Accense Technology, Inc.

July 2015

Sales begun of CloudTriage, a unique, cloud-based operations monitoring service by Terilogy.

Dec. 2015

Distribution contract signed with American company RedSeal, Inc.

Apr. 2016

Distribution contract signed with Taiwanese system integration company SYSCOM.

Oct. 2016

Distribution contract signed with Canadian company Wedge Networks, Inc.

Oct. 2016

Exclusive domestic reseller contract signed with American company Tempered Networks, Inc.

Nov. 2016

Distribution contract signed with Israeli company KELA.

Jan. 2017

Basic agreement on business collaboration signed with NCXX Group Inc. based on capital tie-up agreement.

Jan. 2017

Basic agreement on joint security-product marketing signed with FISCO Ltd.

Jan. 2017

Basic agreement on business collaboration in the area of transaction security with Fisco Cryptocurrency Exchange Inc.

Jan. 2017

Basic agreement on business collaboration in the area of joint product development for blockchain technology applications signedwith SJI Ltd (now CAICA Inc.).

Mar. 2017

Wholly owned subsidiary Terilogy Worx Corporation established.

Dec. 2017

Shares required for ICT-business corporation establishment acquired by ITX Corporation, and wholly-owned consolidated
subsidiary Terilogy Serviceware Corporation established.

Apr. 2018

Distribution contract signed with American company Nozomi Networks Inc.

July. 2018

Sales begun of EzAvater, Terilogy's unique, ultra-simple robotic process automation (RPA) tool.

Jan. 2019

Business tie-up agreement signed with Israeli company Harel-Hertz Investment House Ltd.

Source: Prepared by FISCO from the Company’s securities report and website

We encourage readers to review our complete legal statement on “Disclaimer” page.

05 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/

Company profile

3. Core competence is its ability to find “emerging technologies” and “marketable products” and its “market
response”
The Company considers its strengths to be 1) its ability to find “emerging technologies” and “marketable products” and its “market response,” which is the discernment required to find and identify progressive, leading-edge
technologies and deploy them in markets in ways adapted specifically to local customers; 2) wide selection ofcustomer solutions, of a diverse selection of security and safety solutions for varying applications, encompassing
everything from network infrastructure to communication endpoints; 3) diverse service provision approaches, of aflexible Terilogy-product provision comprising diverse intermixing of products and services, encompassing everythingfrom products utilizing leading-edge technologies through to maintenance services, software products developed
in-house, and new services; 4) technical capabilities rooted in experience, of technical strengths and abilities forged,
since its founding, through three decades of reliable, customer-tailored service provision; and 5) global response
capabilities, of products and services for global markets, including the rapidly growing markets of emerging nationsin Asia. Each of these strengths are backed-up by a track record of results, but in particular, the Company’s ability
to find “emerging technologies” and “marketable products” and its “market response” would seem to be its corecompetence on which all of the other strengths are based.
The Company’s ability to find “emerging technologies” and “marketable products” is “after accurately ascertain
the trends of the times and incorporating them into its business areas, the ability to find the latest technologies inoverseas venture companies and to conclude a distributor contracts and other contracts with them,” and it has noshortage of experience in discovering the latest technologies in overseas venture companies. In addition to Wellfleet
and Infoblox, which were introduced as good examples in the previous section, we can also mention TippingPoint(Trend Micro), OneSpan, and Lastline as examples in the security field.
TippingPoint is a cybersecurity company specializing in ISP (Intrusion Prevention System) that was acquired by Trend
Micro in 2015 for approximately US$ 0.3bn, However, the Company concluded a domestic (Japan) master reseller
contract and accumulated a track record with TippingPoint 11 years before its acquisition, and it continues to havea presence in which it is relied on by Trend Micro. Also, in 2007, the Company became the first in Japan to handle
OneSpan’s one-time password technology, which today has been adopted by all of Japan’s megabanks and become
an essential part of Internet banking. Moreover, in 2012, the Company started selling the targeted-attack countermeasure cloud services of Lastline of the US, and as is clear from the trend in the number of targeted-attack emails
ascertained by the National Police Agency (2014: 1,723 cases→2015: 3,828 cases→2016: 4,046 cases→2017:
6,027 cases→2018: 6,740 cases), in recent years, malware and other targeted attacks have come to be recognized
as a major threat. This example would seem to clearly demonstrate the Company’s ability to accurately ascertain
the technological trends and cutting-edge technologies that it should precisely focus on as its business areas andits ability to find “emerging technologies” and “marketable products” with “foresight.”
So why does the Company select overseas venture companies as its partners? The reason is the height of its “market
response” that it has fine-tuned since its foundation by implementing a management strategy that is supported byits corporate philosophy of prioritizing customers’ needs and levels of satisfaction.

We encourage readers to review our complete legal statement on “Disclaimer” page.

06 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/

Company profile

The sources of the Company’s “market response” are 1) its ability to combine imported technologies with its
proprietary technologies to develop solutions with high levels of customer satisfaction, and 2) its ability to fill-in
missing parts by fully utilizing an alliance and M&A strategy. In general, even if venture companies are able to create
good technologies and products, in many cases they are inferior to major companies in the value chain for aspects
like maintenance and sales. But in the case of the Company, in 1991, two years after it was founded, it concluded
a maintenance outsourcing contract with Toshiba IT-Services Corporation (formerly Toshiba Engineering Co., Ltd.)For sales, one of its features is that it has not only established an indirect sales network, including through alliances,
but that it has also worked to strengthen its direct sales force, such as by acquiring customer touch points throughbusiness and capital alliances and M&A.
The Company has been highly evaluated by influential customers for its active utilization of a partnering strategy forthe entire value chain, from product development (combining imported technologies with its proprietary technologies)
through to sales (using both direct and indirect agency network sales) and maintenance (in which the Company
itself identifies problems and then outsources the actual maintenance work), and it is efficiently building an excellent customer base (more than 300 companies, mainly major companies, and it conducts business directly witharound 90% of customers). This has formed the “excellent distribution capabilities in Japan” (a wealth of customer
information, a maintenance system that operates 24 hours a day, 365 days a year, and extensive customer contact
points through combining direct sales with indirect sales) and it became the deciding factor for the overseas venturecompanies to choose the Company as its partners in Japan.
The Company’s value chain

Source: The Company's website██Business description
Develops its business in four sections; the Network Section, theSecurity Section, the Monitoring Section, and the Solutions Services
Section
1. Develops its business in four sections by products and services
The Company does not disclose segment information, but it develops its business activities in four sections according to products and services; the Network Section, the Security Section, the Monitoring Section, and the Solutions
Services Section.

We encourage readers to review our complete legal statement on “Disclaimer” page.

07 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/

Business description

Diagram of the business structure

Source: The Company's securities report

2. Network Section
In the Network Section in FY3/19, net sales were ¥970mn, which provided 26.5% of total net sales. The main
products and services it handles are 1) network products (routers, switches, and wireless LAN, DNS/DHCP), 2)
design and build of in-company information and communication systems and infrastructure, and 3) sales of a wide
range of network-related products, such as TV conferencing systems, and provision of professional services. The
Company takes pride in its ability to provide solutions optimized to meet customer needs because of the trackrecords accumulated in the 30 years since its foundation. In addition, it has a system in place to respond 24 hours
a day, 365 days a year for the maintenance work for the networks and incidental devices provided by this section.
Main products in the Network Section

Source: The Company's website

We encourage readers to review our complete legal statement on “Disclaimer” page.

08 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/

Business description

3. Security Section
In the Security Section in FY3/19, net sales were ¥1,245mn, which provided 34.0% of total net sales and it is
the Company’s main business pillar. The main products and services it handles are 1) network security products(firewalls, intrusion detection and prevention countermeasures, information leakage countermeasures, etc.), 2)
security authentication infrastructure (identifying service users on a network), and 3) security systems to prevent
unauthorized intrusions (one-time password products). In addition, it has a system in place able to respond 24 hours
a day, 365 days a year for maintenance work for the security devices and software products provided by this section.
Main products in the Security Section

Source: The Company's website

4. Monitoring Section
In the Monitoring Section in FY3/19, net sales were ¥590mn, which provided 16.1% of total net sales, while a featureof this section is the handling of the Company’s own-brand products. The main products and services it handles
are 1) packet analysis using an in-house developed product (momentum), 2) cloud-based monitoring services(CloudTriage), and 3) network operation, management, and monitoring devices. In addition, it has a system in placeable to respond 24 hours a day, 365 days a year for the maintenance work for the in-house developed products(momentum), and network operation, management, and monitoring devices and software products provided bythis section.
The Company’s own brands are “momentum,” (network packet capture products developed completely in-house),which constitutes the core of the Monitoring Section, and “CloudTriage” (IT systems operation monitoring cloudservices managed under its own brand), which use a monthly billing model and forms part of the support businesssection. In “momentum,” data (packets) exchanged on a network are collected in a storage device and analyzed
and made visible in order to validate service quality, specify locations of defects, and provide support measures. It
is, so to speak, a drive recorder-like solution on a network, and the Company has successfully acquired importantcustomers, such as major mobile communication carriers. Also, “CloudTriage” measures the operation conditionsof IT systems from the user’s viewpoint, and in the event of a decline in performance, like a delay in remote access,it specifies the cause. It is provided inexpensively as a monthly billing cloud service.

We encourage readers to review our complete legal statement on “Disclaimer” page.

09 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/

Business description

Main products in the Monitoring Section

Source: The Company's website

5. Solutions Services Section
In the Solutions Services Section in FY3/19, net sales were ¥853mn, which provided 23.3% of total net sales. The
main products and services it handles are 1) an in-house developed software Robot Process Automation (RPA) tool
(EzAvater), 2) a multi-lingual real-time video interpretation service (Mieru-Tsuyaku), 3) a cloud-based, managed VPN
service (MORA VPN Zero-Con), 4) a Web conference service (MORA Video Conference), 5) a corporate Internet
connection service (MORA Hikari), and 6) a high-speed mobile data communication service (MORA Mobile).
The core of this section is formed by Terilogy Serviceware Corporation (changed corporate name from ITX
Corporation’s corporate ICT services business that was acquired from the Nojima Corporation <7419> Group in
December 2017), and in its M&A strategy, the Company is acquiring new business domains and a customer baseof medium-sized and SME customers, which it has had few of in the past. The point to focus on for this is the lineupof new products matched to medium-sized and SME customer groups, such as the RPA tool (EzAvater) which is
attracting attention toward realizing work-style reforms and improved work efficiency, and the multi-lingual, real-timevideo interpretation service (Mieru-Tsuyaku), which can be used to respond to inbound demand.
Main products in the Solutions Services Section

Source: The Company's website

We encourage readers to review our complete legal statement on “Disclaimer” page.

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COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/

Business description

The features of “EzAvater” include it is extremely easy (robots for everyone = intuitive operations to enable thecreation of scenarios to automate routine tasks), it makes delays unlikely (the robots work at the speed of the system,
and it creates templates for exception processing and realizes stable operations), it does not matter what app is used(through the adoption of image recognition technology, work can be automated regardless of the app, as long as it
is operating on Windows) and it can start small (can be introduced starting from a single PC). Due to these features,“EzAvater” overcomes may of the weaknesses of RPA tools, such as that if there is no specialist IT department, it
is difficult to create the robots and the introduction costs and maintenance burden are large. This software made it
possible for a utilization method that creates robots that reflect the needs of work sites in each department and tohave them carry out daily management tasks. For sales of “EzAvater,” the Company is actively utilizing a partnering
strategy (it has introduced the Gold Partner system) with the aim of spreading its use among a wide range of usergroups, and it concluded reseller contracts in rapid succession during 2019, with NCXX Solutions Inc., in April; with
Panasonic Solution Technologies Co., Ltd., and Resona Gate Co., Ltd., in June; with Yamazakibuneidou, Inc., in
July; with Nextage Co., Ltd. and islenet Inc., in August; and with UCHIDA ESCO Co., Ltd.<4699> in September.

██Results trends
Results have bottomed-out and the ordinary income margin is up toaround 6%.
The financial structure has greatly improved from the effects ofutilizing treasury shares to increase capital
1. The FY3/19 figures show that results have bottomed-out
In the FY3/19 consolidated results, net sales increased 13.6% YoY to ¥3,660mn, operating income rose 47.0% to¥244mn, ordinary income grew 32.3% to ¥229mn, and net income attributable to owners of parent climbed 34.6%
to ¥207mn. Looking at the rates of progress for the initial Company forecasts, net sales were 3.7% below forecast.
But operating income and ordinary income were above forecast by 22.1% and 25.6%, respectively. Net income
attributable to owners of parent was significantly above forecast, by 62.3%, due to the recording of a gain on salesof investment securities in extraordinary income. So these figures can be evaluated as positive, suggesting that
results have bottomed-out.
The gross profit margin has improved greatly, from 20.6% (non-consolidated) in FY3/15 to 38.3% in FY3/19, thiswas due to the effects of the improved product mix following the launches of highly profitable in-house products
and services, which are highly profitable. Looking at the level of the ordinary income margin also, it was 6.3% in
FY3/19 (up 0.9 of a percentage point (pp) YoY), which is at a level approaching the highest rate since the listing, at
7.1% in FY3/04, and based on this and the fact that results have bottomed-out, it looks like the Company’s earnings
capability is greatly improving. In FY3/19, the SG&A expenses ratio was 31.7% from the effects of the higher sales
and efforts to keep down costs. Although it rose from 26.6% in FY3/18, which was the lowest level in the last 10
years (including non-consolidated results), this was due to an increase in costs from aiming to further strengthen
the ability to acquire earnings, and it is not considered to be a cause for concern.

We encourage readers to review our complete legal statement on “Disclaimer” page.

11 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.

31-Jan.-20203356 TSE JASDAQ Standard

https://www.terilogy.com/english/

Results trends

Simplified income statement(¥mn)
FY3/15

FY3/16

FY3/17

FY3/18

FY3/19Net sales

2,804

2,639

2,434

3,221

3,660

YoY

9.5%

-5.9%

-7.7%

-

13.6%
2,256

2,226

1,890

1,709

2,197

YoY

19.2%

-15.1%

-9.6%

-

2.7%

Gross profit

577

748

725

1,024

1,403

-16.6%

29.7%

-3.0%

-

37.0%

789

721

831

858

1,159

-3.0%

-8.6%

15.2%

-

35.0%

-212

26

-105

166

244

-

-

-

-

47.0%

-207

-0

-97

173

229

-

-

-

-

32.3%

-211

-19

-99

154

207

-

-

-

-

34.6%

Cost of sales

YoY
SG&A expenses
YoY
Operating income
YoY
Ordinary income
YoY
Net income
YoY

Note: Results are non-consolidated up to FY3/17 and consolidated from FY3/18 onwards
From FY3/18, net income attributable to owners of parent
Source: Prepared by FISCO from the Company’s financial results and securities report

Trends in the profit margins, etc.
Gross profit margin (left)
Ordinary income margin (right)

（%）
45.0

SG&A expenses ratio (left)

（%）
6.3

40.0

38.3

35.0

8.0
6.0

4.0
31.7

30.0

2.0

25.0

0.0

20.0

-2.0

15.0

-4.0

10.0

-6.0

5.0

-8.0

0.0

-10.0
FY3/15

FY3/16

FY3/17

FY3/18

FY3/19Note: Results are non-consolidated up to FY3/17 and consolidated from FY3/18 onwards
Source: Prepared by FISCO from the Company’s securities report

At the end of FY3/18, total assets were ¥3,194mn and total net assets were ¥1,441mn. We can see some noticeablechanges compared to FY3/18, including that notes and accounts receivable – trade decreased ¥120mn, short-termborrowings declined ¥1,039mn, and total net assets increased ¥678mn. Looking at the indicators of financial
stability, the equity ratio rose significantly, up 20.6 pp compared to 45.0% at the end of the previous fiscal period.
This was due to the effects of sales of treasury shares and the completion of the exercise of share acquisition rights,
in addition to improved earnings results. The current ratio also improved to 179.2% from 99.0% at the end of theprevious fiscal period.

We encourage readers to review our complete legal statement on “Disclaimer” page.

12 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.

31-Jan.-20203356 TSE JASDAQ Standard

https://www.terilogy.com/english/

Results trends

Based on the financial results report, ROE declined 1.4 pp YoY to 18.8%, but this was alongside the increase inshareholders’ equity and is not a problem. In fact, ROA (Return on Assets) rose by 1.7 pp to 7.3%, which is its
highest value in the last 10 years (including non-consolidated results), and overall, the profitability of assets continues
to improve.
Simplified balance sheet(¥mn)
End of FY3/15
Current assets
Cash and deposits
Notes and accounts receivable - trade

End of FY3/16

End of FY3/17

End of FY3/18

End of FY3/19

Change

2,614

2,019

2,063

2,288

2,355

1,578

1,007

1,098

972

1,064

66
92

516

524

493

863

742

-120
21

Inventory assets

45

64

24

35

56

Non-current assets

438

435

375

834

839

5

121

108

93

131

148

17

Property, plant and equipment
Intangible assets

76

87

63

381

353

-28

Investments and other assets

240

239

218

321

337

16

Total assets

3,052

2,455

2,439

3,123

3,194

71

Current liabilities

2,219

1,676

1,752

2,312

1,314

-998

Accounts payable - trade

388

106

315

252

243

-8

Short-term borrowings

1,107

928

750

1,177

137

-1,039

109

78

49

48

439

391

-

-

-

-

386

386

98

67

35

9

11

2

2,329

1,755

1,802

2,361

1,753

-607

1,107

928

750

1,177

524

-653

723

699

637

762

1,441

678

Non-current liabilities
Long-term borrowings
Lease obligations
Total liabilities
Interest-bearing debt
Total net assets

Note: Results are non-consolidated up to FY3/17 and consolidated from FY3/18 onwards
Source: Prepared by FISCO from the Company’s financial results and securities report

Trends in shareholders’ equity and the equity ratio（¥mn）

Shareholders’ equity (left)

Equity ratio (right)

1,600

1,441

1,400

50.0

1,000
723

600
400

70.0
60.0

1,200

800

（%）

699
28.5

23.7

762

45.0

637
26.1

40.0
30.0
20.0

24.4

10.0

200
0

0.0
FY3/15

FY3/16

FY3/17

FY3/18

FY3/19Note: Results are non-consolidated up to FY3/17 and consolidated from FY3/18 onwards
Source: Prepared by FISCO from the Company’s securities report

We encourage readers to review our complete legal statement on “Disclaimer” page.

13 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/

Results trends

At the end of FY3/19, cash and cash equivalents were ¥569mn. Looking at each of the cash flow conditions, cash
flow provided by operating activities was ¥374mn, mainly due to net income before taxes of ¥279mn, while cash
flow used in investing activities was ¥55mn, which is a return to the natural situation from the temporary increase in
expenditure seen in the previous fiscal year due to the M&A. Conversely, cash flow used in financial activities was¥218mn overall, this was due to net decrease in short-term borrowings of ¥1,177mn which was partially offset byrevenue from the exercise of share acquisition rights of ¥468mn.
Simplified cash flow statement(¥mn)
FY3/15

FY3/16

FY3/17

FY3/18

FY3/19Net cash provided by (used in) operating activities (a)

150

-223

Net cash provided by (used in) investing activities (b)

-49

-4

291

-55

374

-0

-440

Net cash provided by (used in) financing activities

146

-55

-231

-219

391

-218

Free cash flow (a) + (b)Cash and cash equivalents at end of period

100

-228

291

-495

318

934

445

535

462

569

Note: Results are non-consolidated up to FY3/17 and consolidated from FY3/18 onwards
Source: Prepared by FISCO from the Company’s financial results

2. Achieved higher sales and profits in actual terms in FY3/20 1H
In the FY3/20 1H consolidated results, net sales increased 18.4% YoY to ¥1,839mn, operating income rose 8.8% to¥61mn, and ordinary income grew 65.2% to ¥72mn. Net income attributable to owners of parent decreased 37.3%
to ¥43mn. This was due to the absence of gain on sales of investment securities recorded in the same period in
the previous fiscal year, and when excluding the effects of this, we can see that in actual terms, sales and profits
increased.
The rates of progress toward achieving the initial Company forecasts are 44.5% for net sales, 21.9% for operating
income, 28.0% for ordinary income, and 24.0% for net income attributable to owners of parent. Looking at therates of progress in FY3/19 1H for the full fiscal year forecasts, they were 42.5% for net sales, 23.1% for operating
income, 19.2% for ordinary income, and 33.3% for net income attributable to owners of parent. We see that results
tend to be concentrated in the 2H considering its business characteristics, so the current 1H results can be thought
to be basically in line with the forecasts.
What is noteworthy about the 1H results is the improved soundness of the financial structure. Looking at theindicators of financial stability at the end of the 1H, equity ratio had further risen from 45.0% at the end of theprevious fiscal period to 55.1%, while the current ratio was also above 200%, at 224.2%, indicating a sufficientlevel of solvency. Breaking down current assets, cash and deposits were ¥1,800mn, which constitutes 60.2% of
the total. Also, shareholders’ equity has risen as high as ¥2,096mn and retained earnings, which are the source ofdividend payments, were ¥95mn shifting from a negative level (¥565mn) to a positive due mainly to a transfer from
capital surplus. The Company has thus already secured a sufficient source of funds at the end of FY3/20 1H for theplanned period-end dividend payments of ¥81mn at ¥5 per share.

We encourage readers to review our complete legal statement on “Disclaimer” page.

14 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/

Results trends

Trends in the current ratio, cash and deposits, and retained earnings
（%）

（¥mn）
Cash and deposits (left)

Retained earnings (left)

2,000

250

1,500

200

1,000
150
500
100

0
50

-500
-1,0000FY3/15

FY3/16

FY3/17

FY3/18

FY3/19FY3/20 1H

Note: Results are non-consolidated up to FY3/17 and consolidated from FY3/18 onwards
Source: Prepared by FISCO from the Company’s securities report

Also, the greater soundness of the financial structure has led to an improvement in non-operating profit/loss. In thecase of the Company, which handles imported goods as its mainstay products, the impact of foreign exchange
profit/loss on non-operating revenue cannot be completely eliminated. But in FY3/20 1H, the effects of reducing
the interesting-bearing debt became apparent (interest expenses decreased by 66.2% YoY), which played a role in
improving the non-operating profit/loss.

（¥mn）
1,400

Trends in interest-bearing debt, interest expenses, and non-operating
profit/loss
Interest-bearing debt (left)
Non-operating profit/loss (right)

Interest expenses (right)

（¥mn）
20
15

1,200

10
1,000

5
0

800

-5
600

-10
-15

400

-20
200

-25

0

-30
FY3/15

FY3/16

FY3/17

FY3/18

FY3/19FY3/20 1H

Note: Results are non-consolidated up to FY3/17 and consolidated from FY3/18 onwards
Source: Prepared by FISCO from the Company’s securities report

We encourage readers to review our complete legal statement on “Disclaimer” page.

15 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/██Outlook
The business environment is favorable, and the Company is firstaiming for ¥5bn in net sales by resuming the M&A strategy
1. In FY3/20, expects to resume dividend payments based on organic growth
For the FY3/20 consolidated results, based on the continuing favorable business environment, the Company has
left unchanged its initial forecasts that it announced on May 10, 2019, with net sales to increase 12.8% YoY to¥4,130mn, operating income to rise 14.7% to ¥280mn, ordinary income to grow 13.2% to ¥260mn, and net income
attributable to owners of parent to decrease 13.2% to ¥180mn. However, for the dividend policy, on May 30, 2019,it announced that it was “targeting a dividend payout ratio of 50% or above” and that it plans to pay a period-end
dividend per share of ¥5. The Company also expects total sales by business section to increase.
Outlook for net sales by business section in FY3/20

Source: The Company materials

Looking at the FY3/20 1H results and the ordering trends in each section at the present time, we think it is highly
likely that sales and profit will increase. Also, steady progress is being made not only for recurring-type revenue,
but also in improving the balance sheet, so it seems likely that the Company will pay a period-end dividend of ¥5
as planned. Conversely, for the question of whether all four of the business sections can achieve higher sales, itwill be necessary to pay attention to the 4Q results, as this quarter provides a high percentage of annual sales ineach section.

We encourage readers to review our complete legal statement on “Disclaimer” page.

16 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/

Outlook

Trends in quarterly net sales by business section

Security Section quarterly sales

Network Section quarterly sales
(¥mn)
350

FY3/18

FY3/19
600

300

500

250

FY3/20

400

200
300
150

200

100

100

50
0
1Q

2Q

3Q

4Q

0
1Q

Monitoring Section quarterly sales(¥mn)

FY3/18

2Q

3Q

4Q

Solutions Services Section
quarterly sales

300

FY3/19
360

250

300

200

240

150

180

100

120

50

60

FY3/20

0

0
1Q

2Q

3Q

1Q

4Q

2Q

3Q

4Q

Source: Prepared by FISCO from the Company’s securities report and quarterly securities reports

We encourage readers to review our complete legal statement on “Disclaimer” page.

17 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/

Outlook

2. The Security Section is benefiting in advance of the mega event in 2020
The business environment continues to be favorable at the present time. First, in the Network Section, there is anabundance of demand relating to the establishment of next-generation network infrastructure, and ordering activities
on the whole are trending strongly, particularly from the major manufacturing industries in Japan, which are themain customers. In the Monitoring Section as well, ordering activities are trending steadily for the Company’s highly
profitable proprietary services, and it can be highly evaluated on the points that its own products and services, of“momentum” and “CloudTriage,” are starting to demonstrate a value mix with the products of other companies. The
former are the firewalls manufactured by Palo Alto Networks, Inc. <PANW> in the US, which have globally excellent
reputations, and the malware countermeasures manufactured by Lastline, Inc. of the US, while for the latter, it isrealizing collaborations with the Wi-Fi solutions of Aerohive Network of the US, which are attracting attention as
next-generation wireless LAN, and this is playing a role in strengthening sales and expanding the market.
In the Security Section, threats such as cyberattacks and unauthorized access have become increasing familiar to
many companies, and in this situation, market interest in cybersecurity is further increasing. In addition, in advanceof the Tokyo 2020 Olympic and Paralympic Games, services to collect and analyze malicious information such asthat exchanged between cybercrime groups and to provide intelligence on cyberthreats to contracting companies,
are attracting more and more attention. Also, in workplaces and buildings that are advancing the utilization of IoT,
cybersecurity measures have become a pressing issue. It can be said that the favorable market conditions are
becoming increasing apparent for the Company, which has a full lineup of security services, including KELA’s threat
monitoring solutions that have a track record in preventing terrorism at the 2012 London Olympics and Paralympic
Games, cyber-defense products that protect the safety of companies’ inter-site communication (manufactured by
Tempered Networks), and Industrial Control Systems (ICS) manufactured by Nozomi Networks to quickly detectcyberthreats and abnormal processes in industrial control systems, such as in societal infrastructure and plants.
Security solution are attracting attention in advance of the mega event

Source: The Company's results briefing materials

We encourage readers to review our complete legal statement on “Disclaimer” page.

18 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/

Outlook

3. Solutions Services Section is expected to build a new customer baseIn the Solutions Services Section, due to the ongoing rise in the number of foreigners visiting Japan, there continue
to be opportunities to increase introductions of the multi-lingual, real-time video interpretation service (MieruTsuyaku). "Mieru-Tsuyaku" is a video interpretation service that is usable anytime, anywhere, and with one touch,by using a tablet or smartphone, with a call operator providing support such as for customer service. It provides
an interpretation service for English, Chinese, Korean, Thai, Russian, Portuguese, Spanish, Vietnamese, French,
Tagalog, and Japanese sign language for a flat rate (¥15,000 per month in the light plan, usable from 10am to 9pm,
and ¥25,000 per month in the standard plan, usable 24 hours a day). Moreover, the Company has also prepared
medical interpreting options (Only in English, Chinese, and Korean, ¥35,000 per month) in order to respond to
demand arising from medical tourism, which is increasingly attracting attention as Chinese tourists’ shopping
sprees begin to wane. Introduced companies include Aeon Co., Ltd. <8267>, H.I.S. Co., Ltd. <9603>, HINKA
RINKA, West Nippon Expressway Company Limited, Nishi - Nippon Railroad Co., Ltd. <9031>, Nojima Corporation,
AOYAMA TRADING Co., Ltd. <8219>, AOKI Holdings Inc. <8214>, Victoria Inc., Zoff Co., Ltd., Tokyo International
Air Terminal Corporation, and SEIBU RAILWAY Co., Ltd., DESCENTE LTD.<8114>, and steadily spreading mainly
among leading companies.
The Company is working to expand its customer base as the solution service provider supporting “proactive
marketing” for inbound-related demand with the growth of “Mieru-Tsuyaku” in advance of the mega event in
2020, in May 2019 the Company started provided it as a package service with “arrows hello AT01,” which is amulti-interpretation device manufactured by FUJITSU LIMITED <6702>.
For “EzAvater” also, which is an extremely simple RPA tool, the previously mentioned Golden Partner system is
expected to have the effect of increasing sales. For remote-conference services as well, the Company is strengthening its service lineup of new products and responding to the increase in demand relating to supporting work-stylereforms through improving productivity and increasing work efficiency.
Solutions services supporting "proactive marketing” for inbound-related demand

Source: The Company's results briefing materials

We encourage readers to review our complete legal statement on “Disclaimer” page.

19 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

Terilogy Co., Ltd.
3356 TSE JASDAQ Standard

31-Jan.-2020
https://www.terilogy.com/english/

Outlook

4. Expected to announce a new medium-term management plan with an M&A strategy added to the organic
growthIn May 2018, the Company announced a medium-term management plan themed “Toward Terilogy in Three Years’
Time.” In it, it sets the targets for the medium-term management plan’s final fiscal year of FY3/20; net sales ¥5bn andresuming dividend payments. This would be achieved through the growth strategy, whose main pillars are 1) businessexpansion through M&A and alliances, 2) providing product and services installed with the latest technologies 3) avalue mix with the products of other companies, with its own products as the core products, and 4) taking on thechallenge of conducting an inbound-demand business and implementing measures to contribute to society.
Numerical targets in the medium-term management plan
(before the review of the business sections)

Source: The Company's results briefing materials

The net sales target of ¥5bn ultimately includes business expansion from M&A and alliances, and on looking
only at the part from organic growth, the current situation is that it is implementing a growth strategy basically asplanned and clearly has in sight higher sales and profits and resuming dividend payments in FY3/20. Therefore, it isconsidered that the Company should be positively evaluated to a certain extent. Also, on looking at the improvements
made in its financial structure and considerable amount of current assets secured, for the M&A and alliances as
well, it seems it is steadily working below the surface to finetune the strategy.
On December 2, 2019, the Company issued a press release titled “Measures on activities in our company’s information disclosure and public-relations fields for shareholders and investors,” in which it clarified that it will “Implement
measures for public relations and publicity activities toward improving medium- to long-term and sustainable
enterprise value, while also aiming to maximize enterprise value.” So we think it is highly likely that it will announce
a new medium-term management plan in the spring of 2020, which is the final year of the current medium-term
management plan.
In the new medium-term management plan, we can expect the Company to present an equity story that combines
a specific action plan to progress organic growth with an M&A financial strategy based on a highly convincing
financial strategy.
We encourage readers to review our complete legal statement on “Disclaimer” page.

20 20

Disclaimer
FISCO Ltd. (“FISCO”) offer stock price and index information for use under the approval of theTokyo Stock Exchange, the Osaka Stock Exchange and Nikkei Inc.
This report is provided solely for the purpose of offering information, and is not a solicitationof investment nor any other act or action.
FISCO prepared and published this report based on information which it considered reliable;
however, FISCO does not warrant the accuracy, completeness, fitness nor reliability of thecontents of this report or the said information.
The issuers’ securities, currencies, commodities, securities and other financial instruments
mentioned in this report may increase or decrease in value or lose their value due to influence
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not make any promises regarding any future outcomes. If you use this report or any information
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This report has been prepared at the request of the company subject hereto based on theprovision of information by such company through telephone interviews and the like. However,
the hypotheses, conclusions and all other contents contained herein are based on analysis
by FISCO. The contents of this report are as of the time of the preparation hereof, and are
subject to change without notice. FISCO is not obligated to update this report.
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◾ For inquiry, please contact: ◾

FISCO Ltd.
5-11-9 Minami Aoyama, Minato-ku, Tokyo, Japan 107-0062
Phone: 03-5774-2443 (Financial information Dept.)
Email: support@fisco.co.jp