For Immediate Release
May 15, 2023

PERSOL HOLDINGS CO., LTD. (TSE 2181)
Consolidated Financial Results for the Fiscal Year Ended March 31, 2023
PERSOL HOLDINGS CO., LTD. (the Company) today announces its consolidated financial results
for the fiscal year ended March 31, 2023 and consolidated financial forecasts for the fiscal year
ending March 31, 2024.
Consolidated Operating Highlights
1) Financial Results

Net sales(In millions of yen, unless otherwise stated)
Fiscal year ended March 31,
Change2022
2023
1,060,893
1,223,967
15.4%

Operating profit

48,14353,061

10.2%

EBITDA1

67,15076,417

13.8%

Ordinary profit

49,48453,6938.5%

Net profit2

31,906

20,578-35.5%Net profit per share (yen)138.51

89.61-

Adjusted net profit

39,52940,995

3.7%

Adjusted EPS3 (yen)171.60178.51

4.0%

Notes:
1. EBITDA = operating profit + depreciation + amortization of goodwill
2. Net profit attributable to owners of parent
3. Adjusted EPS = adjusted net profita/ (average number of shares during the period - number of treasury stock during the period)a.

Adjusted net profit = net profit attributable to owners of parent ± adjustment itemsb (excluding non-controlling interests) ±tax reconciliation related to certain adjustment itemsb.

Adjustment items = amortization of intangible assets except goodwill by acquisitions + amortization of goodwill ± extraordinary
income/losses

4. Effective in the fiscal year ended March 31, 2023, the Company and its consolidated subsidiaries in Japan changed the accounting
method of asset retirement obligations. Accordingly, retroactive adjustments are reflected in the values for the previous year.

2) Balance Sheet Data
(In millions of yen, unless otherwise stated)
As of March 31, 2022

As of March 31, 2023

Total assets

425,110442,159

Net assets

204,367

200,732

Equity ratio

43.1%

42.0%

Equity capital

183,048

185,517

Note:
Effective in the fiscal year ended March 31, 2023, the Company and its consolidated subsidiaries in Japan changed the accounting
method of asset retirement obligations. Accordingly, retroactive adjustments are reflected in the values for the previous year.

3) Cash Flow Sheet(In millions of yen, unless otherwise stated)
As of March 31, 2022
Cash flows from operating activities

As of March 31, 2023

50,692

52,796

Cash flows from investing activities-7,057-22,504

Cash flows from financing activities‐21,145‐38,268

Cash and cash equivalents at end of period

106,558

99,6584) Dividend Status(In yen, unless otherwise stated)
Fiscal year ended/ending March 31,
2021

2023 (forecast)

2022

Interim dividends

20.00

21.00

43.00

Year-end dividends

22.00

40.00

43.00

Annual dividends

42.00

61.00

86.00

Total dividend amount (million yen)

9,745

14,030-

Payout ratio (%)

30.3

68.1

50.2

Dividend on equity ratio (%)

5.7

7.6

-

Notes:
1.

Effective in the fiscal year ended March 31, 2023, the Company and its consolidated subsidiaries in Japan changed the accounting
method of asset retirement obligations. Accordingly, retroactive adjustments are reflected in the values for the previous year.

2.

The dividend payout ratio through the fiscal year ending March 31, 2023 is based on net income per share.
Dividend forecast for the fiscal year ending March 31, 2024 shows the dividend payout ratio based on adjusted EPS

5) Consolidated Financial Forecast for the Fiscal Year Ending March 2024
(In millions of yen, unless otherwise stated)
Forecast for the fiscal year
Change from the previous
ending March 31, 2024
fiscal year
Net sales

1,340,000-

Operating profit

54,500-Adjusted EBITDA

75,500-Adjusted net profit 1

39,000-Adjusted EPS (yen)171.41-

Notes:
1. For details, please refer to "(1) Management Discussion and Analysis, 3. Financial Forecasts for the Fiscal Year Ending March 31,
2024."
2. The company has changed its accounting policy from Japanese GAAP to International Financial Reporting Standards (IFRS) from theconsolidated fiscal year ending March 31, 2024. In accordance with the disclosure based on IFRS from the first quarter of the same
fiscal year, the consolidated forecast will also be disclosed accordingly.
Adjusted EBITDA = operating profit + depreciation (excluding lease depreciation and amortization) ± adjusted items(1)Adjusted items(1) = ±increase/decrease in accrued paid leave + share-based payment expenses ± other revenues and expenses ± othernon-recurring profit/loss
Current net profit after adjustment = net profit attributable to owners of the parent company ± adjusted items(2) ± tax reconciliation
related to certain adjustment items(2)Adjustment items(2) = [±increase/decrease in accrued paid leave + share-based payment expenses ± non-recurring profit/loss +amortization of intangible assets except goodwill by acquisitions] (excluding those attributable to non-controlling interests)

(1) Management Discussion and Analysis
1. Result of Operations
PERSOL GROUP (the Group) provides a wide range of human resources (HR) related services;
temporary staffing and placement service as the core businesses in Japan and Asia-Pacific(APAC) region.
The business environment in Japan in the fiscal year under review saw further waves of
COVID-19, but moves to normalize economic activities continued as restrictions on activities
for preventing infection were gradually eased over the period until the end of the fiscal year.
The ratio of job offers to job seekers (seasonally adjusted) in Japan was 1.32 in March 2023,
showing that demand for human resources continued to recover steadily. In the APAC region,
the economic trend was generally one of recovery, with the exception of certain regions
where the impact of COVID-19 persisted.
In this business environment, sales increased in all SBUs. As a result, consolidated net sales
were 1,223,967 million yen (increasing 15.4% year-on-year). On the profit front, operating
profit of the overall Group was 53,061 million yen (increasing 10.2% YoY) and ordinary profit
was 53,693 million yen (increasing 8.5% YoY), mainly reflecting an increase in sales in Career
SBU, driven by brisk corporate demand for hiring. However, net profit attributable to ownersof parent stood at 20,578 million yen (decreasing 35.5 % YoY) due in part to the impairmentof domestic and overseas subsidiaries.
Results by SBU (before inter-segment elimination) are as follows.
a. Staffing SBU
In this segment, the Group operates temporary staffing business, including mainly clericaland administrative staff dispatching and wide range of staffing service, BPO and placement
service mainly for administrative talents in Japan.
Sales for this fiscal year were 618,481 million yen (increasing 7.4% YoY) and operating profit
was 36,180 million yen (decreasing 8.1％ YoY).
Sales increased on strong results of public-related projects in the BPO sector, in addition toa year-on-year increase in the number of temporary active staff. Operating profit decreased
despite the effect of increased sales, more than offset by an increase in paid holidays taken
by temporary staff, an increase in social insurance contributions and the impact of atemporary decrease in projects related to public health, among other factors.
b. Career SBU
In this segment, the Group mainly operates placement business, supporting corporate clients'
mid-career hiring activities, and job recruitment media business.
Sales for this fiscal year were 104,467 million yen (increasing 38.8% YoY) and operating
profit was 15,532 million yen (increasing 113.8% YoY).
Sales in the placement business and job recruitment media business increased due to strong
corporate demand. Operating profit increased significantly on stronger sales, offsetting therise in costs that resulted from marketing investment and enhancement of hiring activities,
which were aimed at achieving future growth.

c. Professional Outsourcing SBU
In this segment, the Group operates manufacture and development outsourcing business in
IT and engineering areas and temporary staffing business specialized in engineers
dispatching.
Sales for this fiscal year were 134,085 million yen (increasing 10.7% YoY) and operating
profit was 7,518 million yen (increasing 8.4% YoY).
Sales increased because the engineering area saw growth in demand, mainly for developmentin the manufacturing industry. Operating profit increased due to the effect of increased sales,
more than offsetting an increase in cost that reflected a stepping up of activities to recruit
engineers.
d. Solution SBU
In this segment, the Group provides digital solution services for hiring talents and managing
human resources and creates new businesses through incubation programs.
Sales for this fiscal year were 15,434 million yen (increasing 38.2% YoY) and the operating
loss was 3,837 million yen (the operating loss was 3,058 million yen for the same period of
the previous fiscal year).
Sales increased due to the continued growth of the job search application business and cloud
POS business, mainly reflecting growth in corporate demand for hiring and the effect of sales
promotion activities. An operating loss was recorded due to an increase in costs, which
resulted from increased investments for future growth.
e. Asia Pacific SBU
In this segment, the Group operates temporary staffing business and placement business in
Asia and staffing business and maintenance business in Australia (those businesses areoperated under PERSOLKELLY brand in Asia and under Programmed brand in Australia.)
Sales for this fiscal year (APAC local accounting period of 12 months ended December 31,2022) were 367,779 million yen (increasing 26.8% YoY) and operating profit was 2,517
million yen (increasing 141.5% YoY).
Sales increased due to the effect of the stronger US dollar and Australian dollar in addition
to the progress in the recovery from the impact of the spread of COVID-19 infection andgrowth in many areas where the Group operates. Operating profit increased due to the effectof increased sales.
#

#

#

#

The Company and its Japanese subsidiaries have changed their accounting policy including
the accounting method of asset retirement obligations, effective from the beginning of thecurrent fiscal year. Comparison and analysis with the same period of the previous year andthe previous consolidated fiscal year have been made using figures that reflect the retroactive
application. For details, please refer to " Changes in Accounting Policies" and “Changes in
Accounting Estimates”

2. Business Outlook and Management Policy
I.

Changes in the Market Environment and Its Overall Picture
Reflecting the

power

shift

of

individuals,

includingtheemployment

mobility

anddiversification of work styles and values about working, the time is coming when individuals
envision their careers on their own, understand that not only work but also their life constitutea part of their career, and then seek “Workplace Well-being," or happiness felt by themthrough their own work. In addition, the evolution of management through collaborative
creation by people and technologies is demanded at present due to rapid technologicalevolution, including the shift to remote work, automated operations and labor saving, anddata-based analysis and optimization.
The Company aims to be a company creating Workplace Well-being, which expands thehappiness of individuals and society by broadening the range of options available for eachindividual and the freedom of working through the provision of diverse work styles andlearning opportunities under the Group Vision, "Work, and Smile." Further, to respond tothese social changes and diversifying individual needs, the Company has set the direction ofits management, in which it aims to evolve into a technology-driven HR service company,
which achieves discontinuous growth with products and digitalization while attachingimportance to the intervention value of people.
Taking advantage of various businesses and services related to working and diverse humancapital, the Company will work to create value for the future, aiming to "create better work
opportunities for one million people by 2030 by expanding possibilities of people."
II. Goal of Value Creation
The Company has set "creating better work opportunities for one million people by 2030 byexpanding possibilities of people" as the goal of its value creation. The Company will provide
diverse work styles and offer learning opportunities, aiming to create better work
opportunities for at least 500,000 people under the Group Mid-term Management Plan 2026
(FY2023 to FY2025) and for at least one million people by 2030.
III. Materiality Initiatives
Under the Group Mid-term Management Plan 2026 toward 2030, the Company has identified
the following eight issues of materiality, which are categorized into solving social issues
through business activities and foundation for achieving sustainable growth. The Company
will take initiatives to address each.

<Solving social issues through business activities>i.

Creating work opportunities: Expanding the potential of one million workers by 2030
by creating better employment opportunities, using our strengths in matching people
with organizations, attracting customers and designing operationsii.

Providing diverse work styles: Proposing and providing flexible work styles andemployment options, helping people realize work styles that cater to their individual
needs

iii.

Providing learning opportunities: Broadening the range of options for workers byproviding learning opportunities that will lead to employment, reskilling, andupskilling, thus maximizing career possibilities of individuals

iv.

Improving productivity at companies: Contributing to the streamlining of corporate
activities and to solutions to the labor shortage by providing services which help
improve productivity<Foundation for achieving sustainable growth>v.

Active roles for diverse personnel: Achieving the Group Vision by developing a
corporate culture of, and building an environment for, taking advantage of diversityvi.

Strengthening data governance: Clearly stating and further strengthening theCompany's common approach and management and protection frameworks forutilization of personal data, thus improving the user environment and securing trustvii.

Respect for human rights: Promoting initiatives that conform to international norms
as a responsible company, thereby reducing human rights risks and earning the trustof all stakeholders including employees

viii.

Responding to climate change: Working to achieve carbon neutrality and helping
realizeadecarbonizedsocietythroughenvironment-related

(GX:

Green

Transformation) staffing services and other initiatives
IV. Financial Policy
Under the Group Mid-term Management Plan 2026, the Company has put in place a new
financial strategy, so as to powerfully drive initiatives to improve the Group's corporate value
by combining each SBU's business strategy and the financial strategy as an inseparable pair.
Under the new financial strategy, the Company has set growth and capital efficiency as thebasic policy of management and set financial strategy indicators to drive the operation with
importance attached to the pursuit of optimal capital composition, sophistication of
investment decision making, and increase of shareholder diversity and stock liquidity.

The Company has set numerical targets for ensuring growth potential, efficiency, andsoundness as key financial KPIs and will ensure cash allocation with a good balance among
businesses, capital investment, and dividends.
Regarding growth potential, the Company has replaced operating profit, which was theindicator under the previous Mid-term Management Plan, with adjusted EDITDA, reflecting
the shift to IFRS. The Company will focus more on cash flows in performance management.
Regarding efficiency, a level exceeding that set under the previous Mid-term Management
Plan will be set as the overall Group's target, although the business maturity differs among
SBUs. The Company aims to achieve ROIC at 15% or higher and ROE at 18% or higher as
the final targets, while assuming a temporary decline attributed to investment.
Regarding soundness, while the Company will procure funds for large-scale investments andothers by making effective use of liabilities from the viewpoint of managing capital cost, it
will maintain a firm financial basis by conducting monitoring with a focus on both stock andflow, so as to maintain and improve its rating.
Further, the Company positions the return of profit to shareholders as a management
priority and will increase the dividend payout ratio to approx. 50% of adjusted EPS under thecurrent Mid-term Management Plan.
While the dividend payout ratio will be increased significantly compared to the period of theprevious Mid-term Management Plan, sufficient funds needed for future growth investments
can be secured by a cash position with adjusted EBITDA of 100.0 billion yen or more in
FY2025 and by procuring funds within the scope of prudential standards. The Company will
make its shareholder returns more attractive to increase the number of its shareholders andthe trading volume.
3. Financial Forecasts for Fiscal Year Ending March 31, 2024
Effective at the beginning of the fiscal year ending March 31, 2024, the Company changed
its accounting policy from the Japanese GAAP to IFRS. Because the Company will disclose
consolidated financial results for the first three months ending June 30, 2023 and thereafter
under IFRS, the Company also discloses consolidated financial forecasts under IFRS.
While the uncertain international situation attributed to overseas geopolitical risks, theongoing price hike, and other events need to be closely monitored, brisk corporate demandfor hiring is expected due to the gradual economic recovery that has resulted fromthe subsiding of COVID-19 and the resumption of economic activities. Accordingly, the HR
market surrounding the Company is expected to remain on a recovery trend.
Because of this environment, the Company forecasts the following financial results for the
fiscal year ending March 31, 2024: revenue at 13,400 billion yen; operating profit at 545
billion yen; adjusted EBITDA at 755 billion yen; profit attributable to owners of parent at 390
billion yen, and; adjusted EPS at 171.41 yen.

(2) Financial Position
1. Consolidated Balance Sheet
Total assets at the end of the consolidated fiscal year under review was 442,159 million yen,
an increase of 17,048 million yen from the end of the previous consolidated fiscal year.
Current assets increased by 17,384 million yen, to 304,281 million yen. This mainly reflects
increases in accounts receivable - trade of 10,806 million yen and in contract assets of 7,292
million yen, more than offsetting a decrease in cash and deposits of 7,788 million yen. Noncurrent assets decreased by 336 million yen, to 137,877 million yen. This is attributable
mainly to a decrease in goodwill of 9,329 million yen, offsetting increases in deferred tax
assets of 3,416 million yen and in investment securities of 3,393 million yen.
The total amount of liabilities was 241,426 million yen at the end of the fiscal year underreview, up 20,683 million yen from the end of the previous consolidated fiscal year. Current
liabilities increased by 27,527 million yen, to 195,421 million yen. This is mainly due toincreases in short-term borrowings of 11,199 million yen, in accounts payable – other of
10,121 million yen, and in current portion of bonds payable of 10,000 million yen, more thanoffsetting a decrease in current portion of long-term borrowings of 11,243 million yen. Noncurrent liabilities decreased by 6,844 million yen, to 46,005 million yen. This is attributed
mainly to a decrease in bonds payable of 10,000 million yen.
The amount of total net assets at the end of the fiscal year under review was 200,732 million
yen, down 3,634 million yen compared to the end of the previous consolidated fiscal year.
This was mainly caused by the payment of dividends of surplus of 9,971 million yen and theposting of 20,578 million yen in profit attributable to owner of parent company, which
resulted in an increase in retained earnings of 10,607 million yen and a foreign currencytranslation adjustment increase of 6,669 million yen. Other reasons were a decrease in noncontrolling interests of 6,103 million yen and a decrease in capital surplus of 5,712 million
yen, mainly due to the acquisition of additional shares in PERSOLKELLY PTE. LTD. by PERSOLAsia Pacific Pte. Ltd.
As financial indicators based on the financial position described above, the current ratio
decreased from 170.9% to 155.7％, and the equity ratio decreased from 43.1％ to 42.0％,
respectively, compared to the end of the previous consolidated fiscal year.
As of March 31,2022

As of March 31,
2023

Return on assets (ROA)

8.6％

5.3%

Return on equity (ROE)

18.9%

11.2%

Ratio of operating profit to sales

4.5％

4.3%

Ratio of ordinary profit to sales

4.7％

4.4%

Current ratio

170.9％

155.7％

Fixed ratio

75.5％

74.3％

Equity ratio

43.1％

42.0％

ROIC

14.2

15.3

Debt/equity ratio

0.28

0.28

Net cash/EBITDA ratio

0.82

0.62

Total assets (million yen)

425,110442,159

Equity capital (million yen)

183,048

185,517

Invested capital (million yen)

269,376

273,110

Cash and cash equivalents at end of period(million yen)

106,558

99,658

* From the current fiscal year., the Company and its consolidated subsidiaries in Japan changed
accounting method of asset retirement obligations. Accordingly, retroactive adjustments arereflected in the values for the previous consolidated fiscal year.

2. Consolidated Cash Flows
Cash and cash equivalents (hereinafter "capital") as of March 31, 2023 was 99,658 million
yen, down 6,899 million yen from the end of the previous consolidated fiscal year.
Presented below are an overview of cash flows for this fiscal year and main factors behindthem.

(Cash flows from operating activities)
Capital generated by operating activities increased 2,103 million yen from the previous
consolidated fiscal year, to 52,796 million yen. Major factors included income taxes paid of
24,640 million yen and an increase in trade receivables of 12,611 million yen, offset by profit
before income taxes of 40,716 million yen, depreciation of 16,059 million yen, andimpairment losses of 12,239 million yen.

(Cash flows from investing activities)
Capital used as a result of investing activities increased by 15,446 million yen from theprevious consolidated fiscal year, to 22,504 million yen. This was mainly due to spending of
10,108 million yen on the purchase of intangible assets, 3,331 million yen spent on purchaseof property, plant and equipment, and 3,321 million yen spent on purchase of shares ofsubsidiaries resulting in change in scope of consolidation.

(Cash flows from financing activities)
Capital used as a result of financing activities increased by 17,123 million yen from theprevious consolidated fiscal year, to 38,268 million yen. This was mainly caused by spendingof 13,764 million yen for purchase of shares of subsidiaries not resulting in change in scopeof consolidation, 9,999 million yen for purchase of treasury shares, and 9,969 million yen for
payment of dividends.

(3) Basic Policy of Accounting Standards
The Company previously applied the Japanese GAAP. Starting from the three months ending
June 30, 2023, the Company will voluntarily apply the International Financial ReportingStandards (IFRS) instead of the Japanese GAAP for improving the international comparabilityof financial information in the capital markets and enhancing information it discloses, among
other purposes.

Consolidated Financial Statements(1) Consolidated Balance Sheet(in millions of yen)
As of March 31, 2022

As of March 31, 2023

AssetsCurrent assets
Cash and deposits
Notes receivable - trade107,545

99,757

100

100

Accounts receivable - trade

150,073

160,879

Contract assets

18,65825,951Work in process

333

384

10,74017,780Other
Allowance for doubtful accounts
Total current assets

-554

-572

286,897304,281

Non-current assets
Property, plant and equipment
Buildings and structures

11,686

13,016

Accumulated depreciation-6,639-9,403

Accumulated impairment

-10

-54

5,036

3,558

Buildings and structures, net
Tools, furniture and fixtures

7,062

7,859

Accumulated depreciation-4,835-5,312

Accumulated impairment

-79

-110

Tools, furniture and fixtures, net

2,147

2,437

9,169

12,676

Accumulated depreciation-5,758-7,420

Right of use assets, net

3,410

5,256

Right of use assets

Land

515

515

Other

3,906

5,410

-1,601-2,303

Accumulated depreciation
Accumulated impairment

－

-24

2,304

3,082

13,414

14,849Trademark right

9,803

10,052

Goodwill

61,67452,344

Software

16,78718,081

Other

6,863

5,842

Total intangible assets

95,12986,320Investment securities

8,664

12,058Deferred tax assets

10,324

13,741Other

12,20812,535

Allowance for doubtful accounts-1,527-1,627

Total investments and other assets

29,67036,707138,213

137,877

425,110442,159

Other, net
Total property, plant and equipment
Intangible assets

Investments and other assets

Total non-current assets
Total assets

(Consolidated Balance Sheet)(in millions of yen)
As of March 31, 2022

As of March 31, 2023

Liabilities
Current liabilities
Accounts payable - trade

630

602

Short-term borrowings

162

11,361－

10,000Current portion of bonds payable
Current portion of long-term borrowings

11,30460

Accounts payable - other

81,81391,934

Income taxes payable

11,211

11,418

Accrued consumption taxes

17,432

18,967

Provision for bonuses

17,847

19,86871

129

Provision for bonuses for directors (and otherofficers)
Other provisions

714

1,535

Other

26,70629,541

Total current liabilities

167,893

195,421

Non-current liabilities
Bonds payable

10,000－Long-term borrowings

30,00030,116

Lease liabilities

1,997

3,421

Deferred tax liabilities

3,039

4,018

Retirement benefit liability

414

311

Provision for share awards

810

1,085

Provision for share awards for directors (andother officers)

835

1,104

4,430

4,659

Asset retirement obligations
Other provisions
Other
Total non-current liabilities

81

45

1,239

1,242

52,85046,005

220,743

241,426

Share capital

17,47917,479

Capital surplus

19,16813,455Retained earnings

158,282

168,890

Treasury shares-10,351-19,459

Total shareholders' equity

184,579

180,366

Valuation difference on available-for-salesecurities

959

971

Foreign currency translation adjustment-2,4894,179

Total accumulated other comprehensive
income-1,5305,150

Total liabilities
Net assets
Shareholders' equity

Accumulated other comprehensive income

Share acquisition rights

00

Non-controlling interests

21,317

15,214

Total net assets

204,367

200,732

425,110442,159

Total liabilities and net assets

(2) Consolidated Income Statements and Comprehensive Income Statement(Consolidated Income Statement)(in millions of yen)
Fiscal year ended
March 31, 2022
Net sales

Fiscal year ended
March 31, 2023

1,060,893

1,223,967

Cost of sales

820,056

941,323

Gross profit

240,837

282,643

Selling, general and administrative expenses

192,694

229,581

Operating profit

48,14353,061Non-operating income
Interest income

49

90

Dividend income

232

242

Subsidy income

1,342

1,696

25

－

Foreign exchange gains
Other
Total non-operating income

540

233

2,189

2,261

Non-operating expenses
Interest expenses

270

432

Foreign exchange losses－

353

Commission expenses

24

1

Share of loss of entities accounted for using
equity method

174

529

Other

377

313

Total non-operating expenses

847

1,630

49,48453,693

1,500

57

486

－

Gain on sale of investment securities

1,712

233

Total extraordinary income

3,698

290

Ordinary profit
Extraordinary income
Gain on sale of non-current assets
Gain on sale of shares of subsidiaries andassociates

Extraordinary losses
Loss on disposal of non-current assets
Impairment losses
Loss on sale of investment securities

3

8

1,675

12,2391－

Loss on valuation of investment securities

801

369

Restructuring expenses

530－

Non-recurring loss

127

649

3,139

13,267

Profit before income taxes

Total extraordinary losses

50,04340,716

Income taxes - current

18,88020,121

Income taxes - deferred-3,653-2,241

Total income taxes

15,227

17,880

Profit34,81522,835

Profit attributable to non-controlling interests

2,909

2,257

Profit attributable to owners of parent

31,906

20,578(Consolidated Comprehensive Income Statement)(in millions of yen)
Fiscal year ended
March 31, 2022
ProfitFiscal year ended
March 31, 2023
34,81522,835

Valuation difference on available-for-salesecurities-1,39112Foreign currency translation adjustment

4,358

6,857

40

281

3,007

7,151

37,822

29,98734,35027,260

3,472

2,727

Other comprehensive income

Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners ofparentComprehensive income attributable to noncontrolling interests

(3) Consolidated Statement of Changes in Equity
For the Fiscal Year Ended March 31, 2021
(In millions of yen)
Shareholders' equity
Share capital
Balance at beginning of
periodCumulative effects ofchanges in accounting
policies
Restated balance
Changes during period
Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
sharesChange in ownershipinterest of parent due
to transactions with
non-controllinginterests
Net changes in items
other thanshareholders' equity
Total changes during
periodBalance at end of period

Capital surplus

17,479Retainedearnings

19,008Treasury shares

134,151

Total
shareholders'equity-11,100-124
17,47919,008

159,539-124

134,027-11,100

159,415-7,651-7,651

31,90631,906

167

-0

-0

749

917

-7

-7

-

160

24,254748

25,163

17,47919,168158,282-10,351

184,579

Accumulated other comprehensive income

Balance at beginning of
periodCumulative effects ofchanges in accounting
policies
Restated balance

Valuationdifference on
available-forsale
securities

Foreigncurrencytranslation
adjustment

Total
accumulated
othercomprehensiv
e income

2,350-6,325-3,974

ShareacquisitionrightsNon-controllinginterests

0

18,035

Total net
assets173,600
-124

2,350

-6,325-3,9740

18,035

173,476

Changes during period
Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
sharesChange in ownershipinterest of parent due
to transactions with
non-controllinginterests
Net changes in items
other thanshareholders' equity
Total changes during
periodBalance at end of period-7,651
31,906-0917-7-1,391

3,836

2,444

-

3,282

5,726

-1,391

3,836

2,444

-

3,282

30,890959-2,489-1,530021,317204,367For the Fiscal Year Ended March 31, 2022
(In millions of yen)
Shareholders' equity
Share capital
Balance at beginning of
periodCapital surplus

17,479Retained earnings Treasury shares

19,168158,282

Total
shareholders'equity-10,351

184,579

Changes during period
Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
sharesChange in ownershipinterest of parent due
to transactions with
non-controllinginterests
Net changes in items
other thanshareholders' equity
Total changes during
periodBalance at end of period-9,971-9,971

20,57820,578335-9,999-9,999892

1,227-6,04817,479-6,048-5,712

10,607-9,107-4,212

13,455

168,890-19,459

180,366

Accumulated other comprehensive income

Balance at beginning of
periodValuationdifference on
available-forsale
securities

Foreigncurrencytranslation
adjustment

Total
accumulated
othercomprehensiv
e income

959-2,489-1,530Share
acquisitionrightsNon-controllinginterests

0

21,317

Total net
assets

204,367

Changes during period
Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
sharesChange in ownershipinterest of parent due
to transactions with
non-controllinginterests
Net changes in items
other thanshareholders' equity
Total changes during
periodBalance at end of period-9,971
20,578-9,9991,227-6,048

11

6,669

6,681

-6,103

578

11

6,669

6,681

-6,103-3,634

971

4,179

5,150

15,214

200,7320(4) Consolidated Cash Flow Statements(in millions of yen)
Fiscal year ended
March 31, 2022

Fiscal year ended
March 31, 2023

Cash flows from operating activities
Profit before income taxes

50,04340,716

Depreciation

12,15016,059Impairment losses

1,675

12,239Amortization of goodwill

6,856

7,296

Increase (decrease) in retirement benefit liability

-482

-134

Increase (decrease) in provision for bonuses

2,378

1,832

Increase (decrease) in provision for bonuses for
directors (and other officers)

21

52

Increase (decrease) in provision for shareawards

226

275

301

268

-193

6

Increase (decrease) in provision for shareawards for directors (and other officers)
Increase (decrease) in allowance for doubtful
accounts
Increase (decrease) in other provisions

33

859

Interest and dividend income

-281

-332

Interest expenses

270

432

Share of loss (profit) of entities accounted forusing equity method

174

529

-1,342-1,694-486－-1,711

-233

801

369

-1,496

-48

530

－

Subsidy income
Loss (gain) on sale of shares of subsidiaries andassociates
Loss (gain) on sale of investment securities
Loss (gain) on valuation of investment securities
Loss (gain) on disposal of non-current assets
Restructuring expenses
Non-recurring loss

127－

Decrease (increase) in trade receivables-28,855-12,611

Increase (decrease) in trade payables

7,367

7,735

99

1,283

Increase (decrease) in long-term accounts
payable - other

-225

-81

Decrease (increase) in other assets

9,920

-415

Increase (decrease) in accrued consumption
taxes

Increase (decrease) in other liabilities

1,922

1,444

Subtotal

59,82775,848Interest and dividends received

280

334

Interest paid

-265

-471

Subsidies received

1,342

1,694

Payments of restructuring expenses

-530

－

Income taxes paid

-12,542-24,640

Income taxes refund

2,581

29

50,692

52,796

Net cash provided by (used in) operating
activities

(in millions of yen)
Fiscal year ended
March 31, 2022

Fiscal year ended
March 31, 2023

Cash flows from investing activities
Payments into time deposits

-820

-174

Proceeds from withdrawal of time deposits

51

1,178

Purchase of property, plant and equipment-2,604-3,331

Proceeds from sale of property, plant andequipment

1,877

86

Purchase of intangible assets-8,383-10,108

Purchase of shares of subsidiaries and associates－-1,301

Purchase of investment securities-1,195-2,867

Proceeds from sale of investment securities

4,276

309

-250

-3,321673－-1,126-2,486

Purchase of shares of subsidiaries resulting inchange in scope of consolidation
Proceeds from sale of shares of subsidiaries
resulting in change in scope of consolidation
Payments for acquisition of businesses
Proceeds from sale of businesses－

20

Proceeds from absorption-type mergers－-16

Loan advances-3-0

Proceeds from collection of loans receivable

4

3

Payments of guarantee deposits

-452

-728

Proceeds from refund of guarantee deposits

1,072

779

Other, net

-178

-545

-7,057-22,504

Net increase (decrease) in short-termborrowings-470

11,020

Repayments of long-term borrowings-691-13,040

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

Redemption of bonds-10,000－

0-9,999-7,651-9,969

-198

-248

-7

-13,764-2,125-2,265-21,145-38,268

1,078

1,077

23,567-6,899Cash and cash equivalents at beginning of period

82,991

106,558

Cash and cash equivalents at end of period

106,558

99,658Purchase of treasury shares
Dividends paid
Dividends paid to non-controlling interests
Purchase of shares of subsidiaries not resulting
in change in scope of consolidation
Other, net
Net cash provided by (used in) financing
activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash
equivalents

Changes in Accounting Policies
Application of the Guidance on Accounting Standard for Fair Value Measurement
The Guidance on Accounting Standard for Fair Value Measurement (ASBJ Guidance No. 31,
June 17, 2021) began to be applied at the beginning of the three months ended June 30,
2022. It was decided that the new accounting policies prescribed in the Guidance on
Accounting Standard for Fair Value Measurement will be applied into the future in accordancewith the transitional treatment provided for in Paragraph 27-2 of the Guidance on AccountingStandard for Fair Value Measurement.
The application has no effect on consolidated financial statements.

Change in Accounting for Asset Retirement Obligations
Previously, asset retirement obligations related to obligation to restore to original condition
set forth in real-estate lease agreements signed by the company and its consolidated
subsidiaries in Japan were posted in the following way. The amount of leasehold deposits
related to the said real-estate lease agreements which was not expected to be collected
finally was reasonably estimated, and then, the portion of the above amount to be allocatedto each quarter was posted. However, the non-current asset management system wasreviewed, and more appropriate accounting has become possible. Therefore, starting fromthe three months ended June 30, 2022, expenses for restoration to original condition isposted as asset retirement obligations, and removal cost corresponding to the asset
retirement obligations is included in property, plant and equipment and depreciated.
This change in accounting policy is applied retroactively, and the change is reflected in the
consolidated financial statements for the previous fiscal year.
As a result, in the consolidated balance sheet for the previous consolidated fiscal year,
buildings and structures, net increased 1,348 million yen, deferred tax assets increased 91
million yen, investments and other assets (other) increased 1,892 million yen, asset
retirement obligations increased 3,791 million yen, and deferred tax liabilities increased 48
million yen, while non-current liabilities (other) decreased 559 million yen, compared tobefore the retroactive application.
The beginning balance of retained earnings for the previous consolidated fiscal year
decreased by 329 million yen due to the application of the cumulative effect to net assets asof the beginning of the previous consolidated fiscal year.
The change has a minor effect on profit and net profit per share for the previous consolidated
fiscal year.

Changes in Accounting Estimates
Changes in Estimates of Facilities attached to Buildings
In the consolidated fiscal year ended March 31, 2023, the Company changed its officestrategy to permit diverse workstyles, such as remote work. The Company took this change
as an opportunity to review the number of years during which facilities attached to buildings
installed at leasehold estates of the Company and its consolidated subsidiaries in Japan are
expected to be used. As a result, the expected lifetime of those facilities was changed fromthe previous 3 to 15 years to 2 to 10 years.

As described in Changes in Accounting Policies, effective from the beginning of the threemonths ended June 30, 2022, removal cost corresponding to asset retirement obligations is
added to the book value of facilities attached to buildings as relevant property, plant andequipment. The removal cost has been distributed based on the number of years during
which the facilities attached to buildings are expected to be used.
As a result of this change, operating profit, ordinary profit, and profit before income taxes
for the consolidated fiscal year ended March 31, 2023 decreased 2,251 million yen.

(Changes in Presentation Methods)
Consolidated Balance Sheet
Asset retirement obligations, which were included in other under non-current liabilities in theprevious consolidated fiscal year, are presented as a separate item, starting from theconsolidated fiscal year under review, as the combined effect of the retrospective applicationof this change in accounting policy exceeded 1/100th of total liabilities and net assets. The
consolidated financial statements for the previous consolidated fiscal year have been restatedto reflect these changes in presentation.
As a result, 5,669 million yen in other under non-current liabilities in the consolidated balance
sheet for the previous consolidated fiscal year (after the retrospective application of thechange in accounting policy) has been restated as 4,430 million yen in asset retirement
obligations and 1,239 million yen in other.

Disclaimer
The statements concerning the Company's future business performances in this material such as financial forecasts are
based on information currently available and certain assumptions deemed to be reasonable by the Company, and do notmean that the Company promises to achieve these figures. Actual results may differ materially from the statements due
to a variety of factors.

This document is provided for informational purpose only. If there are any discrepancies between this and the original,
the original Japanese document prevails.