Note: This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy
between this translated document and the Japanese original, the original shall prevail.

Summary of Results for the Fiscal Year Ended March 2022
(Japanese Standards) (Consolidated Basis)
May 13, 2022
Name of listed company Takuma Co., Ltd.

Listed stock exchange

Listing code 6013
Representative

URL https://www.takuma.co.jp/english/
Hiroaki Nanjo

Contact for inquiries

President and Representative Director
Manager, Corporate Communications &Investor Relations Department
Corporate Planning & Administration
Division

Tokyo Stock Exchange

Hiroyuki Kobayashi(E-mail)koho-ir@takuma.co.jp

Planned regular general shareholders’ meeting convocation dateJune 24, 2022

Planned securities report submission dateJune 24, 2022

Planned dividend payment start dateJune 27, 2022

Availability of supplementary results materials:

Yes

Financial results briefing:

Yes (For securities analysis and institutional investors)(All amounts rounded down to the nearest million yen)

1.

Consolidated results for FY2021 (April 1, 2021, to March 31, 2022)(1) Consolidated results(Percentages indicate percent of change from the previous year.)Net sales
Millions of yen

Operating profit% Millions of yen

Profit attributable toowners of parent

Ordinary profit% Millions of yen%

Millions of yen%

FY2021

134,092

(8.6)

9,928

(5.2)

10,647

(3.5)

7,434

(1.3)

FY2020146,726

9.1

10,473

9.1

11,028

7.1

7,529

1.1

(Note) Comprehensive income:

FY2021
FY20207,246 million yen (down 13.2 %)8,344 million yen (up 41.9 %)Basic earnings
per share

Diluted earnings
per share

Return on equity

Ratio of ordinary
profit to total assets

Ratio of operating
profit to net sales

Yen

Yen

%

%

%

FY2021

91.53

―

8.1

6.0

7.4

FY2020

92.73

―

8.6

6.5

7.1

(Reference)

Equity in net income of affiliates

FY2021
FY2020178 million yen
218 million yen(2) Consolidated financial position
Total assets

Net assets

Capital adequacy ratio

Net assets per share

Millions of yen

Millions of yen%

Yen

FY2021

174,535

94,35453.8

1,162.87

FY2020177,741

90,55550.7

1,109.87(Reference)

Equity FY2021
FY202093,908 million yen
90,142 million yen

(3) Status of consolidated cash flows
Cash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities

Cash and cash equivalents
at end of period

Millions of yen

Millions of yen

Millions of yen

Millions of yen

FY20219,000(2,394)(9,112)

41,244FY2020(1,680)(2,053)

1,903

42,957

2.

Dividend status
Annual dividend
Q1

FY2020
FY2021
FY2022 (forecast)

3.

Q2

Q3

Q4

Total dividend

Total

Yen

Yen

Yen

Yen

―
―
―

18.00
18.00
18.00

―
―
―

18.00
18.00
18.00

Payout ratio(consolidated)

Ratio ofdividends to net
assets(consolidated)

Yen Millions of yen

36.00
36.00
36.00

2,923
2,916

%

%

38.8
39.3
32.9

3.3
3.2

Consolidated earnings forecast for FY2022 (April 1, 2022, to March 31, 2023)(Percentages indicate percent of change from the previous year.)Net sales
FY2022

Operating profit

Millions of yen%

Millions of yen

143,000

6.6

11,800

Profit attributable toowners of parent

Ordinary profit% Millions of yen

18.8

12,500% Millions of yen

17.4

8,800

Basic earnings
per share

%

Yen

18.4

109.29Meeting on February 9, 2022, Takuma’s Board of Directors adopted a resolution implementing a share repurchase program.
Basic earnings per share figures in the consolidated earnings forecast reflect the effects of the share repurchase under that program through April 30,
2022.

○ Attachments
1. Business results ......................................................................................................................................... 2(1) Overview of results for FY2021........................................................................................................... 2(2) Future outlook ...................................................................................................................................... 7(3) Basic policy concerning profit allocation and dividends during FY2021 and FY2022 ....................... 7
2. Management policies ................................................................................................................................... 8(1) Basic policies on management ............................................................................................................. 8(2) Medium- and long-term management strategy and issues that need to be addressed .......................... 9(3) Business environment .......................................................................................................................... 10
3. Basic approach to the selection of accounting standards ............................................................................. 11
4. Consolidated Financial Statements .............................................................................................................. 12(1) Consolidated Balance Sheet ................................................................................................................. 12(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income .............. 14(3) Consolidated Statement of Cash Flows ................................................................................................ 17
5. Supplementary forecast materials ................................................................................................................ 19(1) Consolidated earnings forecast by segment ......................................................................................... 19(2) Consolidated capital investment, depreciation, and research and development expense forecast ....... 19
6. Supplementary Materials ............................................................................................................................. 20
Domestic Environment and Energy Business Breakdown ........................................................................ 20

1. Business results
Forward-looking statements in the text reflect the judgment of the Group’s management as of the end of theconsolidated fiscal year under review.

(1) Overview of results for FY2021
Orders received during FY2021 totaled 192,244 million yen, exceeding our target at the beginning of the year
(180,000 million yen), thanks to reliable conversion of continued robust demand including waste treatment plants,
biomass power plants, and other products into orders as orders received reached a record high.
Net sales fell to 134,092 million yen, down 12,633 million yen from the previous year, when we made significant
progress on waste treatment plant construction projects. As a result, the order backlog rose 58,151 million yen to445,304 million yen.
Operating profit fell 544 million yen compared to FY2020 to 9,928 million yen due to decreased net sales, while
ordinary profit fell 381 million yen to 10,647 million yen. Profit attributable to owners of parent fell 94 million yen
to 7,434 million yen.
Future uncertainty caused by the COVID-19 pandemic has impacted some projects , for example by weighing on
capital investment appetite and spurring delays in plans, and recent trends such as the rising costs of steel and othermaterials and equipment dictate caution with regard to the future direction of the economy.
Performance by segment during the consolidated fiscal year
(Unit: Millions of yen)

Consolidated FY2021
Segment

Ordersreceived

Net sales

OperatingprofitChange from consolidated FY2020
Backlog

Ordersreceived

Net sales

OperatingprofitDomestic Environment and Energy
Business

164,865

108,657

10,906433,351

4,273(12,113)(568)

Overseas Environment and Energy
Business

2,035

1,005

(218)

1,457

1,152

(183)

(77)

Package Boiler Business

16,83016,498

672

4,852

(693)

(433)

32

Equipment and Systems Business

8,917

8,590

656

5,676

(1,248)

319

(220)

Total

192,648

134,752

12,016445,337

3,483(12,409)

(835)

(404)

(659)

(2,087)

(33)

197

(223)

290

192,244

134,0929,928

445,304

3,680(12,633)(544)

Adjustments
Total

The Group’s operating segments consist of the following four businesses: Domestic Environment and Energy,
Overseas Environment and Energy, Package Boiler, and Equipment and Systems business. The flagship Domestic
Environment and Energy segment accounts for most net sales. (During FY2021, this segment accounted for about
80% of total net sales before excluding inter-segment sales and about 90% of total operating profit before excluding
adjustments.)―2―

Domestic Environment and Energy Business
During FY2021, efforts to take advantage of continued robust demand yielded orders in our waste treatment plant
DBO business and for biomass power plant construction. While some contracts were canceled when the underlying
plans were halted, orders received rose 4,273 million yen compared to the previous fiscal year to 164,865 million
yen.
<<Major orders received during FY2021>>
Municipal solid waste plants: Three waste treatment plant DBO business projects, one long-term O&M project
Energy plants: Six biomass power plant new construction projects, one long-term O&M project,
one industrial waste treatment plant new construction project

Water treatment plants: One large-scale replacement project involving a sand filtration system at a sewage
treatment plant

Despite steady expansion in post-delivery maintenance and operation management, O&M, and other after-sales
service business, net sales fell 12,113 million yen from the previous fiscal year to 108,657 million yen, and operating
profit fell 568 million yen to 10,906 million yen, due primarily to changes in the mix of projects undertaken as partof the EPC business.
Long-term O&M such as the DBO business (contracts with a duration of at least 10 years, including with privatesector businesses) accounted for about 50% of the order backlog of 433,351 million yen.
In addition to continuing to work to maintain and expand our position as a leading company by securing orders for
waste treatment plants, biomass power plants, and sewage sludge incineration power plants, we will work to expand
our recurring revenue model businesses, for example by improving quality and strengthening profitability in ouroperations business, pursuing service life extension and solution proposals, and expanding our power retail business.
＜Orders received and net sales (cumulative quarterly total)＞（Unit：Billions of yen）

Orders received
Net sales

164.8

160.5

153.6
123.1
108.1

120.7
108.6

93.7

Q1

Q2
Q3
Q4
Cumulative Cumulative Cumulative

Q1

FY2018Q2
Q3
Q4Cumulative Cumulative Cumulative

Q1

FY2019Q2
Q3
Q4
Cumulative Cumulative Cumulative

Q1

FY2020Q2
Q3
Q4Cumulative Cumulative Cumulative
FY2021＜Orders received and net sales (by quarter)＞（Unit：Billions of yen）

Orders received

78.0

Net sales
60.2
47.7
35.9

29.9

Q1

Q2

Q3

FY2018

Q4

Q1

Q2

Q3

Q4

32.7

33.6
24.7

Q1

FY2019Q2Q3

FY2020

―3―

Q4

Q1

Q2

Q3

FY2021

Q4

Overseas Environment and Energy BusinessAlthough the business environment during FY2021 remained challenging, including as a result of substantial
limitations on sales activities due to the effects of the COVID-19 pandemic and delays in planned projects, we
received an order for one equipment replacement project at an Energy from Waste plant in Taiwan, helping push uporders received 1,152 million yen to 2,035 million yen.
However, net sales fell 183 million yen to 1,005 million yen from the previous fiscal year, when we posted net sales
from a new biomass plant construction project, due the primacy of maintenance sales by local subsidiaries in Taiwan
and Thailand. The cumulative result was an operating loss of 218 million yen, up from a loss of 140 million yen.
In an ongoing effort to secure orders for biomass power plants, we will work to increase added value and differentiate
ourselves from competitors, including by enhancing maintenance services offered through our local subsidiary inThailand and redoubling ongoing cost-cutting efforts by expanding the scope of overseas procurement. In addition,
we will build structures to secure orders for Energy from Waste plants, including partnerships with local companies,
so that we can capture future demand, particularly in Thailand and Taiwan.
＜Orders received and net sales (cumulative quarterly total)＞（Unit：Billions of yen）

Orders received
Net sales

3.0

2.0
1.3
1.1

1.1

0.7

Q1

Q2
Q3
Q4
Cumulative Cumulative Cumulative
FY2018

1.0

0.8

Q1

Q2
Q3
Q4
Cumulative Cumulative Cumulative

Q1

FY2019Q2
Q3
Q4
Cumulative Cumulative Cumulative
FY2020

―4―

Q1

Q2
Q3
Q4
Cumulative Cumulative Cumulative
FY2021

Package Boiler Business
During FY2021, orders received fell 693 million yen from the previous fiscal year, when we posted orders and net
sales associated with a number of large projects, to 16,830 million yen, while net sales fell 433 million yen to 16,498
million yen. In this way, intermittent implementation of states of emergency and targeted anti-infection measures
combined with a sense of uncertainty about the future, including apprehensions about spreading infections, to preventa full-throated recovery, offsetting signs of recovery in equipment availability and new-equipment demand, both ofwhich had been weighed down by the effects of the COVID-19 pandemic.
In addition, operating profit rose 32 million yen to 672 million yen due to factors including a decline in operating
expenses in the face of limitations on sales activities due to the pandemic.
We will continue to maintain and expand the domestic business with a focus on replacement demand and maintenancewhile striving to expand the overseas business through efforts centered on our local subsidiary in Thailand.
Additionally, we will work to develop new heat source system markets anticipating the decarbonized society of the
future, including hybrid hot water supply systems that combine heat pumps with vacuum-type hot water heaters aswell as wood chip-fueled biomass boilers.
＜Orders received and net sales (cumulative quarterly total)＞（Unit：Billions of yen）

Orders received
Net sales
17.4

Q1

Q2
Q3
Q4
Cumulative Cumulative Cumulative
FY201817.9 17.8

16.9

Q1

Q2
Q3
Q4
Cumulative Cumulative Cumulative

17.5 16.9

Q1

FY2019Q2
Q3
Q4
Cumulative Cumulative Cumulative
FY2020―5―

16.8 16.4

Q1

Q2
Q3
Q4
Cumulative Cumulative Cumulative
FY2021Equipment and Systems Business
During FY2021, orders received fell 1,248 million yen to 8,917 million yen. This decline was the result of factors
including delays in private-sector building and equipment construction plans caused by the COVID-19 pandemic,
which offset firming demand for semiconductor industry equipment resulting from an expanding market environment.
In addition, net sales rose 319 million yen from the previous fiscal year to 8,590 million yen, while operating profit
fell 220 million yen to 656 million yen due to factors including the effects of an increasingly competitive environment
in the building equipment business.
Going forward, we will continue to work to expand orders in the building equipment business by strengthening oursales and construction capabilities as well as to increase profit in our semiconductor industry equipment bystrengthening product competitiveness.
＜Orders received and net sales (cumulative quarterly total)＞（Unit：Billions of yen）

Orders received
Net sales
10.1
8.5 8.8

Q1

Q2
Q3
Q4
Cumulative Cumulative Cumulative
FY2018

Q1

Q2
Q3
Q4
Cumulative Cumulative Cumulative

8.9

8.2

7.8
6.7

Q1

FY2019Q2
Q3
Q4
Cumulative Cumulative Cumulative
FY2020

Q1

8.5

Q2
Q3
Q4
Cumulative Cumulative Cumulative
FY2021In April 2021, the Group launched its 13th Medium-Term Management Plan, which covers FY2021 to FY2023,
establishing a cumulative consolidated ordinary profit target of 36.0 billion yen for its three-year period.
Ordinary profit during the consolidated fiscal year under review, which is the first year of the plan, of 10.6 billion
yen fell slightly below the plan’s target. However, we’re steadily capturing orders in the Domestic Environment andEnergy Business, and we will continue to do our best to achieve the plan’s targets. However, potential effects in theevent of a worsening of the pandemic might include fewer new orders if demand slows and new orders are delayed,
as well as lower sales if delivery of existing orders is delayed.

―6―

(2) Future outlook
The Group expects to see continued demand for its principal products, including replacement and service life
extensions for aging waste treatment plants, and construction of biomass power plants against a backdrop of favorable
energy policies. In addition, uncertainty about the future continues, including due to the ongoing effects of the
COVID-19 pandemic, growing tension from the situation in Russia-Ukraine, rising prices for steel and other materials
and equipment, and growing lead times.
During FY2022, in light of these circumstances, we expect to see continued robust demand for facilities such as waste
treatment plants and biomass power plants, and we have set a target of 170,000 million yen for orders received.
We expect net sales, operating profit, ordinary profit, and profit attributable to owners of parent to exceed their levels
during FY2021 at 143,000 million yen, 11,800 million yen, 12,500 million yen, and 8,800 million yen, respectively,
due primarily to steady progress on plant construction projects.
The Group manages its results exclusively on an annual basis because our results tend to fluctuate seasonally, forexample Q4 net sales significantly exceed those of other quarters. The reason is that many projects are delivered justbefore the end of the consolidated fiscal year, so progress and transfers of facilities to customers tend to increase as
Q4 progresses.
Additionally, should the effects of the COVID-19 pandemic broaden or last longer than anticipated, our performance
could be affected, for example in the form of a decline in new orders due to contracting demand or delayed orders ora slowdown in net sales as a result of delays in deliveries of previously ordered projects. These earnings forecasts do
not take such potential impacts into account. In the event it becomes necessary to revise the earnings forecast due toan expansion in the effects of the pandemic, we will make that information available in a timely and appropriatemanner.
• Earnings forecasts and other forward-looking statements in this document are based on information currently
available to the Company and on certain assumptions that are deemed to be reasonable. They do not constitute a
commitment on the part of the Company to achieve any particular level of performance. Actual performance may
diverge significantly for a variety of reasons.

(3) Basic policy concerning profit allocation and dividends during FY2021 and FY2022
Takuma has adopted a policy of returning profits to shareholders founded on the principle of maintaining a stabledividend while working to strengthen its constitution to ensure competitiveness in an increasingly challenging market
and taking into account a comprehensive range of factors, including business performance.
We award a total of two dividends each fiscal year, namely, an interim dividend and a year-end dividend. The former
is determined by resolution of the Board of Directors, while the latter is determined by resolution of the Regular
General Meeting of Shareholders.
In keeping with this policy, we are planning to offer a year-end dividend of 18 yen per share, as announced on May
14, 2021, which combined with the interim dividend paid in December 2021 will yield an annual dividend of 36 yen
per share.
We also plan to offer a dividend of 36 yen per share for the upcoming fiscal year (including an interim dividend of
18 yen and a year-end dividend of 18 yen).
We plan to increase our corporate value by continuing to strengthen our financial position through enhancement of
our internal reserve and utilizing it to finance capital investment and R&D investment to facilitate the future
development of our businesses.

―7―

2. Management policies
Forward-looking statements in the text reflect the judgment of the Group’s management as of the end of theconsolidated fiscal year under review.

(1) Basic policies on management
Company motto
Value Technology, Value People, Value the EarthManagement Principles
Takuma will strive for social contribution, corporate value enhancement, long-term corporate development and thesatisfaction of all stakeholders by providing goods and services that are needed and recognized as valuable in society.
Long-term Vision
Takuma aims for sustainable growth with customers and society by implementing ESG management andmaintenance of its role of being an indispensable presence in society as a leading company in the field of renewableenergy utilization and environmental protection, and we will strive to achieve ordinary profit of 20 billion yen by
2030.
[1] Management Principles
Founder Tsunekichi Takuma invented the Takuma boiler in 1912, making a significant contribution to thedevelopment of Japanese industry. He then founded Takuma in 1938 with the founding spirit of “Serve society
through boiler manufacturing.” Since that time, we have carried on Takuma’s philosophy while manufacturing anarray of boiler types and entered the environmental and sanitation field such as waste treatment plants and water
treatment plants while taking advantage of boiler technologies. Also, we have contributed to the development ofsociety and to providing solutions for challenges while broadening our businesses with a focus on energy use andenvironmental protection. The Group’s Management Principles derive from its founding philosophy, and Takuma
retains an unchanging system of values that seek to contribute to the long-term, sustainable development of society
through its business activities.

[2] Long-Term Vision (Vision 2030)
Global issues that merit concern include the growing seriousness of the problem of climate change; the worsening of
the sanitation environment due to rapid population growth and urbanization, particularly in emerging nations; andincreasing energy demand. At the same time, domestic challenges like falling internal demand caused by the shrinking
and aging of Japan’s population, shortages of human resources and future leaders, tight financial conditions affecting
government, and aging infrastructure are triggering major concerns about how a sustainable society can be realized
going forward. Based on these medium- and long-term trends and social issues, we have formulated Vision 2030 asa long-term vision that will serve as guidelines for the Group’s medium- and long-term management.
In keeping with this vision, the Takuma Group will implement Environment, Social, and Governance (ESG)
management, an approach that consists of addressing key ESG-related issues in an effort to achieve sustainablegrowth by resolving issues faced by customers and society through business activities. In pursuing business activities
built on a core of ESG management, we will strive to become a great partner for our customers by leveraging thetechnologies and expertise related to energy utilization and environmental protection that are the Group’s strengths,
along with the relationships of trust we have developed with customers through long-term after-sales service andother interactions. Through the useful technologies and services created through innovation by the Group, which
carries on the spirit of a tenacious inventor, we will resolve challenges faced by customers and society, with a focus
on the fields of renewable energy utilization and environmental protection. We will work to achieve ordinary profitof 20 billion yen in 2030 by addressing important ESG-related issues through our business activities and pursuingsustainable growth alongside our customers and society.

―8―(2) Medium- and long-term management strategy and issues that need to be addressed
13th Medium-Term Management Plan (FY2021 to FY2023)
The Group launched its 13th Medium-Term Management Plan (FY2021 to FY2023) in April 2021 as the first step
towards realizing Vision 2030. The plan's theme is laying the foundation for further growth based on the managementfoundation and business foundation that the Group has built under previous Medium-Term Management Plans.
Policies of the 13th Medium-Term Management Plan
We will strengthen conventional businesses by reinforcing the Group's management foundation and at the same time
accelerate its response to future environmental changes. We will strive to realize sustainable growth alongsidecustomers and society by implementing ESG management through these business activities.

a. Implementing ESG management
In order to realize sustainable growth alongside customers and society by implementing ESG management as set
forth in Vision 2030, the Group has approached the task of formulating the 13th Medium-Term Management Plan byorganizing various ESG issues from the dual standpoints of their importance for stakeholders on the one hand, andtheir importance for the Group on the other. This process led to the identification of seven key issues (Materiality)that deserve to be given priority by the Group.
Key issues (Materiality)
Environment

Helping combat climate change
Conserving resources and protecting the environment
Strengthening relationships of trust with customers and communities

SocialPursuing partnerships and innovation
Promoting activities of human resources
Ensuring safety and health

Governance

Strengthening corporate governance

Going forward, we will report on specific initiatives and targets related to materialities as well as progress towards
them through our CSR Report and other resources.

―9―b. Strengthening the management foundation
In order to anticipate change and realize additional growth as environmental change gathers pace, for example in the
rapid development of digital technologies and the goal of achieving carbon neutrality by 2050, the Group will work
to strengthen its management foundation through active allocation and investment of resources in human resources,
digital technologies, and other areas of its operations. Through this initiative, we will strengthen conventional
businesses and accelerate our response to future environmental changes.
c. Financial targets
In order to achieve the goal of posting ordinary profit of 20 billion yen in FY2030 as set forth in Vision 2030, the13th Medium-Term Management Plan sets the achievement of steady growth and a target of cumulative consolidated
ordinary profit of 36 billion yen over the course of the plan’s three years as the first step in that process.
(3) Business environment
As the impacts of climate change increasingly manifest themselves, for example in the form of larger-scale natural
disasters, renewable energy is attracting high expectations as a path by which we can realize a carbon-free society. In
addition, there is continuing robust demand in the Group’s principal business domains, such as demand for
replacements and service life extensions of aging infrastructure. At the same time, the business environment is
expected to undergo major changes over the medium and long term, including shifts in demand in response to changes
in the structure of society, for example due to the shrinking and aging of Japan’s population; increased reliance oncomprehensive contracts as part of a trend to outsource government services; and increasing sophistication anddiversity in customer needs in order to solve regional issues.
Additionally, notwithstanding the following descriptions of the business environment for each business segment,
should the effects of the COVID-19 pandemic broaden or become more serious, our performance could be affected,
for example in the form of a decline in new orders due to contracting demand or delayed orders or a slowdown insales as a result of delays in deliveries of previously ordered projects.
Domestic Environment and Energy Business
The primary focus of our Domestic Environment and Energy Business is the construction of waste treatment plants
and sewage treatment plants for local governments and facilities such as biomass power plants for private-sector
customers (EPC business) as well as after-sales service including plant maintenance, operational management, O&M,
and power retail business services (recurring revenue model businesses).
Our EPC business is susceptible to the effects of factors such as government policy, for example environmental andother laws and regulations and policy guiding subsidies for local governments and private-sector businesses, as wellas trends affecting public investment and private-sector capital investment. As a result, demand will fluctuatesignificantly over the medium and long term. At the same time, we expect stable demand for our after-sales service
business, which comprises maintenance and other services, across the plant life cycle of 20 to 30 years after the startof operation.
Demand remains brisk in our EPC business, and we expect that trend to continue for the time being thanks to demand
for replacement and service life extensions due to aging (for waste treatment plants), demand for energy-saving andenergy-creating conversions as part of updates to sludge incineration plants (in the sewage treatment field), anddemand for facilities such as power plants that use biomass or waste plastic as fuel and utilize the feed-in tariff
program for power (for private-sector customers). We also expect to see growing demand in the future in our aftersales service business thanks to trends such as an increase in comprehensive contracts for plant operation in waste
treatment, growing reliance on comprehensive contracts in sewage treatment, and increases in the number of plants
eligible for after-sales service and in demand for operational outsourcing due to growth in the number of plants
delivered by Takuma to private-sector customers.

―10―Overseas Environment and Energy Business
The primary focus of our Overseas Environment and Energy Business is the construction and maintenance of biomass
power plants and Energy from Waste plants overseas. We are developing these businesses primarily in Southeast Asia,
particularly in Thailand and Taiwan, where we have local subsidiaries.
Although we expect to see continued demand for biomass power plants in Southeast Asia on the back of the region’s
rich biomass resources and recognize the market’s high potential over the medium and long term, competition with
Indian and Chinese manufacturers remains intense for our flagship bagasse-fired boiler plants. In addition, while
demand for Energy from Waste facilities is rising as a result of urbanization, a stable market has not yet formed todate due to factors including a lack of programs and standards and insufficient funding from governments.
Package Boiler Business
The primary focus of our Package Boiler Business is the manufacture, sale, and maintenance of general-purpose
boilers such as compact once-through boilers and vacuum-type hot water heaters, which are used as heat-source
equipment at shopping centers, factories, and other facilities.
Although the domestic general-purpose boiler market is a mature market, we expect to see a certain amount ofongoing demand centering on equipment updates, and we also expect demand overseas to grow, primarily inSoutheast Asia.
Equipment and Systems Business
The primary focus of our Equipment and Systems Business is the design and fabrication of building equipment likeair-conditioning, water, and wastewater systems as well as the manufacture, sale, and maintenance of equipment for
use in the semiconductor industry, including clean equipment and washing systems.
Building demand is expected to firm over the medium and long term despite an expected temporary slowdown in thenear future, and the semiconductor manufacturing equipment market is expected to grow over the medium and longterm, despite short-term fluctuations.

3. Basic approach to the selection of accounting standards
The Group’s policy for the immediate future is to compile consolidated financial statements in accordance withJapanese standards.
We intend to carefully consider a future transition to International Financial Reporting Standards (IFRS) based on acomprehensive consideration of factors including our future business activities and trends in the market environment.

―11―

4. Consolidated Financial Statements(1) Consolidated Balance Sheet(Unit: Millions of yen)
FY2020(March 31, 2021)

FY2021(March 31, 2022)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable – trade
Notes receivable – trade
Accounts receivable – trade
Contract assets

44,422

42,97984,222-

3,065-

30,85048,185Merchandise and finished goods
Work in process

907
1,885

834
2,139

Raw materials and supplies
Other

1,671
1,962

1,630
4,646

Allowance for doubtful accounts

(16)

(16)

135,056

134,315

Buildings and structures (net amount)
Machinery, equipment and vehicles (net amount)

4,907
1,521

4,825
1,514

Land
Construction in progress

2,501
231

2,393
2,952

Total current assets
Non-current assets
Property, plant and equipment

Other (net amount)
Total property, plant and equipment
Intangible assets
Investments and other assets
Investment securities

596

661

9,759

12,346267

298

17,74017,012Long-term loans receivable
Deferred tax assets

334
7,310

722
4,748

Retirement benefit asset
Other

48
7,365

38
5,187

Allowance for doubtful accounts

(142)

(134)

Total investments and other assets

32,657

27,574

Total non-current assets
Total assets―12―

42,68540,220177,741

174,535

(Unit: Millions of yen)
FY2020(March 31, 2021)

FY2021(March 31, 2022)

Liabilities
Current liabilities
Notes and accounts payable – trade

30,71733,070Electronically recorded obligations – operating
Short-term borrowings

13,184
5,602

16,493300

Income taxes payable
Advances received

2,569
9,349

500
-

Contract liabilities
Provision for bonuses

3,364

8,669
3,375

Provision for product warranties
Provision for loss on construction contracts

66
3,946

52
1,516

Provision for loss on liquidation of subsidiaries and associates
Other

1,003
6,354

4,724

Total current liabilities

76,157

68,704

80
241

246

Retirement benefit liability
Other

10,451
256

10,791
439

Total non-current liabilities

11,02911,47787,18680,181

Shareholders' equity
Share capital

13,367

13,367

Capital surplus
Retained earnings

3,840
70,8503,872
75,507

Treasury shares(2,087)(2,765)

Total shareholders’ equity

85,97089,981

Valuation difference on available-for-sale securities
Deferred gains or losses on hedges

4,461
36

3,956
110

Foreign currency translation adjustment
Remeasurements of defined benefit plans

30
(355)

79
(220)

Total accumulated other comprehensive income

4,172

3,926

412

445

Non-current liabilities
Long-term borrowings
Provision for retirement benefits for directors (and other officers)

Total liabilities
Net assets

Accumulated other comprehensive income

Non-controlling interests
Total net assets

90,55594,354

Liabilities and net assets

177,741

174,535―13―

(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income
Consolidated Statement of Income

Net sales
Cost of sales

FY2020(April 1, 2020,
to March 31, 2021)
146,726
119,927(Unit: Millions of yen)
FY2021(April 1, 2021,
to March 31, 2022)
134,092
107,909

Gross profit

26,79926,183

Selling, general and administrative expenses
Salaries and allowances

5,601

5,895

1,591
1,372

1,591
1,285

440
60

448
60

1,679
555

1,631
621

240
800

277
838

Taxes and dues
Research and development expenses

642
1,044

474
1,003

Other

2,297

2,125

Total selling, general and administrative expenses

16,326

16,254

10,473

9,928

Welfare expenses
Provision for bonuses
Retirement benefit expenses
Provision for retirement benefits for directors (and other officers)
Commission expenses
Travel and transportation expenses
Depreciation
Rent expenses

Operating profit
Non-operating income
Interest income

21

18

Dividend income
Share of profit of entities accounted for using equity method

435
218

434
178

Other

161

235

Total non-operating income

836

866

Non-operating expenses
Interest expenses

14

5Commitment fees
Loss on disposal of non-current assets

28
148

45
66

Loss on valuation of investment securities
Provision of allowance for doubtful accounts

48

21
-

Other

41

9

Total non-operating expenses
Ordinary profit

―14―

281

148

11,028

10,647

(Unit: Millions of yen)
FY2021(April 1, 2021,
to March 31, 2022)

FY2020(April 1, 2020,
to March 31, 2021)
Extraordinary income
Insurance claim income
Gain on sale of investment securities

1,503

300
197

Total extraordinary income

1,503

497

New factory construction expenses
Provision for loss on liquidation of subsidiaries and associates

882

355
-

Settlement payments
Other

849
99

-

1,831

355

Profit before income taxes

10,70010,789

Income taxes – current

4,269

618

Income taxes – deferred

Extraordinary losses

Total extraordinary losses(1,122)

2,697

Total income taxes

3,146

3,315

Profit

7,553

7,473

24

38

7,529

7,434

Profit (loss) attributable to non-controlling interests
Profit attributable to owners of parent―15―

Consolidated statement of comprehensive income
FY2020(April 1, 2020,
to March 31, 2021)
7,553(Unit: Millions of yen)
FY2021(April 1, 2021,
to March 31, 2022)
7,473

Valuation difference on available-for-sale securities
Deferred gains or losses on hedges

697
32

(504)
74

Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax

43
17

67
135

ProfitOther comprehensive income

Total other comprehensive income
Comprehensive income

791

(226)

8,344

7,246

8,309
35

7,189
57

Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests―16―(3) Consolidated Statement of Cash FlowsFY2020(April 1, 2020,
to March 31, 2021)
Cash flows from operating activities
Profit before income taxes

10,700Depreciation
Loss (gain) on sale of investment securities
Loss (gain) on disposal of non-current assets
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for loss on construction contracts
Increase (decrease) in provision for loss on liquidation of subsidiaries andassociates
Increase (decrease) in retirement benefit liability
Interest and dividend income
Interest paid
Share of loss (profit) of entities accounted for using equity method
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Decrease (increase) in other current assets
Increase (decrease) in trade payables

1,036

961
(197)
66
7

545

(2,429)170(1,003)

365

535

(457)
14

(452)
5

(218)
(11,551)
215

(178)
1,457

2,527

SubtotalInterest and dividends received
Interest paid

10,789(1,503)
148
210

238
539

Increase (decrease) in other current liabilities
Other, net(Unit: Millions of yen)
FY2021(April 1, 2021,
to March 31, 2022)

(138)
(108)
3,745

(1,797)(2,633)
2,690

1,186

13,119527

522

Income taxes refund (paid)(13)(3,380)(8)(4,633)

Net cash provided by (used in) operating activities(1,680)

9,000

(59)
(2,287)45(246)(1,510)
117

(67)

(61)

(1,428)
1,870

(352)
377

(50)
139

(610)
171

(217)

(278)

(2,053)(2,394)

Cash flows from investing activities
Net decrease (increase) in time deposits
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from sale of investment securities
Loan advances
Proceeds from collection of loans receivable
Other, net
Net cash provided by (used in) investing activities―17―

(Unit: Millions of yen)
FY2021(April 1, 2021,
to March 31, 2022)

FY2020(April 1, 2020,
to March 31, 2021)
Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Repayments of long-term borrowings
Purchase of treasury shares
Dividends paid
Dividends paid to non-controlling interests
Other, net
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents

4,950(5,200)

(80)
(0)

(182)
(747)

(2,922)(20)(2,924)
(23)

(22)

(33)

1,903

(9,112)35

45

Net increase (decrease) in cash and cash equivalents(1,795)(2,461)

Cash and cash equivalents at beginning of period
Increase (decrease) in cash and cash equivalents resulting fromchange in scope of consolidation
Cash and cash equivalents at end of period

44,75342,957-

747

42,957

41,244―18―

5. Supplementary forecast materials(1) Consolidated earnings forecast by segment(Unit: Millions of yen)
FY2022 (forecast)
Segment
Orders received

Net sales

Backlog

Domestic Environment and Energy Business

141,500

117,500

457,351

Overseas Environment and Energy Business

3,000

1,000

3,457

Package Boiler Business

17,00017,0004,852

Equipment and Systems Business

9,000

8,000

6,676

170,500

143,500

472,337

(500)

(500)

(33)

170,000

143,000

472,304

Total
Adjustments
Total(2) Consolidated capital investment, depreciation, and research and development expenses forecast(Unit: Millions of yen)
FY2021(actual)Capital investment
Depreciation
Research and development expenses―19―

FY2022(forecast)

Change

3,844

9,000

5,155

961

1,300

338

1,006

1,600

593

6. Supplementary Materials

Domestic Environment and Energy Business Breakdown（Unit：Billions of yen）
FY2021(actual)

Orders received
Municipal Solid Waste Plants (EPC)

Net sales

Backlog

42.5

30.1

121.5

78.7

40.5

221.7

Energy Plants

32.9

29.1

77.1

Water Treatment Plants, other

10.3

8.3

12.8

Adjustments

0.2

0.5

0

164.8

108.6

433.3

Municipal Solid Waste Plants (after sales service
business)

Total―20―