Consolidated Financial Results
for the Second Quarter of the Fiscal Year 2021
Ending March 31, 2022
[Japanese GAAP]
November 5, 2021

Company name: JAMCO Corporation
Stock exchange listing: Tokyo Stock Exchange
Stock Exchange Code: 7408
URL: https://www.jamco.co.jp/
Representative: Harutoshi Okita, President & CEO
Contact: Kentaro Goto, Director & Managing Executive Officer
Phone: +81-42-503-9145
The date of filing quarterly securities report: November 8, 2021
The start date of payout of dividend: —Availability of supplementary briefing material on quarterly financial results: Yes
Schedule of quarterly financial results briefing session: Yes (for institutional investors)(Amounts are rounded down to the nearest million yen.)
1. Consolidated Operating Results for the Second Quarter of the Fiscal Year 2021 (from April 1, 2021 toSeptember 30, 2021)(1) Consolidated Operating Results(%: Changes from the previous corresponding period)
Net sales

Operating income

Net income attributable
to shareholders ofparent company

Ordinary income

For the second
Million yen%
Million yen%
Million yen%
quarter of
Fiscal year 2021
18,477(28.5)(511)(687)
Fiscal year 2020
25,860(36.2)(4,591)(5,409)(Note) Comprehensive income: The second quarter of fiscal year 2021: ¥41 million [-%]The second quarter of fiscal year 2020: ¥(4,396) million [-%]For the second
quarter of
Fiscal year 2021
Fiscal year 2020

Net income per share

Diluted net income
per share

Yen

Yen

(1.76)(160.10)-(2) Consolidated Financial Position
Total assets

Net assets

Million yen

Equity ratio

Million yen%

95,89914,925
As of September 30, 2021
As of March 31, 2021
101,236
16,517(Reference) Equity: As of September 30, 2021: ¥14,622 million
As of March 31, 2021: ¥16,218 million

15.2
16.0

1

Million yen%(47)(4,294)-

2. Dividend distribution

Dividend distribution per share
1stquarter-end

2ndquarter-end
Yen

3rd
quarter-end
Yen

Year-end
Yen

Fiscal year 2020
0.00
Fiscal year 2021
0.00
Fiscal year 2021
(Planned)(Note) Revision to the plan of dividend distribution announced most recently: None

Total
Yen

Yen

0.00

0.00

0.00

0.00

3. Consolidated Financial Results Forecast for the Fiscal Year 2021 (from April 1, 2021 to March 31, 2022)(%: Changes from the previous fiscal year)
Net sales
Million yen

Operating income% Million yen

Ordinary income% Million yen%

Net income
attributable toshareholders ofparent company
Million yen

Full year
43,500 (13.1)(3,980)(4,360)(3,120)(Note) Revision to the forecast of consolidated financial results announced most recently: None

Net income
per share
%

Yen

-

(116.31)* Notes:(1) Changes in significant subsidiaries during this quarter of the fiscal year 2021: None
(2) Accounting policies adopted specially for the preparation of quarterly consolidated financial statements: None
(3) Changes in accounting policies, changes in accounting estimates and retrospective restatement
1) Changes in accounting policies due to the revision of accounting standards: Yes
2) Changes in accounting policies other than 1) above: None
3) Changes in accounting estimates: None
4) Retrospective restatement: None
(4) Number of common shares issued
1) Number of common shares outstanding (including the number of treasury stock):
As of September 30, 2021: 26,863,974 shares
As of March 31, 2021: 26,863,974 shares
2) Number of treasury stock:
As of September 30, 2021: 38,964 shares
As of March 31, 2021: 38,964 shares
3) Average number of common shares outstanding:
2nd quarter of FY 2021: 26,825,010 shares
2nd quarter of FY 2020: 26,825,042 shares

2*Notes:*1. This document is an English translation of a statement written initially in Japanese. The Japanese original
document should be considered as the primary version.
*2. These quarterly financial results are outside the scope of quarterly review by certified public accountants or
audit firms.
*3. Explanation of the proper use of financial results forecast and other notes
The earnings forecasts and other statements herein are based on information currently available to the Company
and certain premises that the Company deems to be reasonable. Actual results may differ significantly fromthese forecasts due to a wide range of factors.
The Company intends to hold a briefing session for institutional investors on November 24, 2021. The materials
distributed at the briefing session are scheduled to be posted on the Company’s corporate website.

3

Table of Contents
1. Qualitative Information on Quarterly Financial Results for the Period under Review ......................... 2(1) Explanation of Operating Results...................................................................................................... 2(2) Explanation of Financial Position ..................................................................................................... 5(3) Explanation of Consolidated Financial Results Forecast and Other Forward-looking Information . 5
2. Quarterly Consolidated Financial Statements and Primary Notes ........................................................ 6(1) Quarterly Consolidated Balance Sheets ............................................................................................ 6(2) Quarterly Consolidated Statements of Income and Comprehensive Income .................................... 8
Quarterly Consolidated Statements of Income.................................................................................. 8
Quarterly Consolidated Statements of Comprehensive Income........................................................ 9(3) Quarterly Consolidated Statements of Cash Flows ......................................................................... 10(4) Notes to Quarterly Consolidated Financial Statements ................................................................... 11(Notes on going concern assumption) ........................................................................................ 11(Notes in the case of significant changes in shareholders’ equity) ............................................. 11(Changes in accounting policies) ..............................................................................................11(Additional information) ............................................................................................................ 12(Quarterly Consolidated Statements of Income) ........................................................................ 12(Segment information, etc.) ........................................................................................................ 13
3. Others..................................................................................................................................................15
Significant Events Regarding Going Concern Assumption.......................................................15

1

1. Qualitative Information on Quarterly Financial Results for the Period under Review(1) Explanation of Operating Results
During the second quarter of FY 2021, some parts of the world economy remained in a challenging situation
amid the global spread of COVID-19. However, as the promotion of COVID-19 vaccination and othercountermeasures were effective in reducing the spread of COVID-19, economies showed signs of recovery. The
dollar-yen exchange rate moved within the range of ¥107 to ¥111 per US$1.
In the air transportation industry, while demand for domestic flights is recovering with COVID-19 vaccination
ramping up, demand for international flights continues to face a challenging situation. Airlines carried on efforts
to reduce costs, though some began ordering aircraft and increasing staff size in anticipation of a recovery indemand for air transportation. Aircraft manufacturers saw a rise in orders for certain models against the backdrop
of a gradual recovery in air transportation demand, especially for domestic flights.
In the situation in which the end of the COVID-19 pandemic remained uncertain, the Group promoted
business process reforms and measures to enhance the efficiency of its production system on a company-widelevel in preparation for a future recovery in demand for air transportation, aiming to improve quality andprofitability while enhancing the efficiency of its management by reducing cost, limiting investment, andreducing inventory, under the assumption that the current harsh business environment would continue for sometime. In addition, we thoroughly enforced COVID-19 countermeasures while working to reduce physical contact
between employees through remote work, shift work, and the dispersion of work areas at the workplace, andflexibly responded to the drop in workload through measures such as temporary leave of employees andsecondment to companies outside the Group.
In the aircraft interiors business and the aircraft seat business, we redoubled our efforts to enhance theefficiency of the production system and reduce the cost of sales. In the aircraft interiors business, we also worked
to develop products to ensure a clean and hygienic cabin in order to relieve the anxiety felt by passengers onboard.
In the aircraft seat business, we focused on deploying our highly profitable Venture business class seats in otheraircraft models to acquire more orders.
The amount of orders received, which had been stagnant due to a sharp drop in air transportation demandcaused by the COVID-19 pandemic, recorded an increase compared to the same period of the previous fiscal year.
This was because, as the effectiveness of vaccination was confirmed, orders from airlines increased with the
expectation that the spread of COVID-19 would subside.
In the aircraft components business, we took initiatives to improve productivity, while proceeding with thedevelopment of lightweight aircraft components using thermoplastic CFRP.
In the aircraft maintenance business, we aimed to establish a business base capable of generating stable profits
by continuing with initiatives to ensure flight safety and enhance quality, while also endeavoring to acquire orders
for aircraft maintenance for airlines and government and municipal offices.
As a result, on a consolidated basis, during the second quarter of FY 2021, the Company posted net sales of¥18,477 million (down ¥7,382 million compared to the same period of the previous fiscal year), operating lossof ¥511 million (an operating loss of ¥4,591 million in the same period of the previous fiscal year), ordinary lossof ¥687 million (an ordinary loss of ¥5,409 million in the same period of the previous fiscal year), and net loss
attributable to shareholders of parent company of ¥47 million (a net loss attributable to shareholders of parent
company of ¥4,294 million in the same period of the previous fiscal year).
Provision for loss on construction contracts of ¥3,720 million for construction to be completed in or after thequarterly third quarter of FY 2021 was recognized as of September 30, 2021. The impact of this provision forloss on construction contracts on income (loss) for the quarterly second quarter of FY 2021 was a decrease of¥865 million in cost of sales (provision for loss on construction contracts as of June 30, 2021 was ¥4,586 million)
and, for the cumulative second quarter of FY 2021, an increase of ¥124 million in cost of sales (provision for loss
on construction contracts as of April 1, 2021 was ¥3,596 million).

2

Selling, general and administrative expenses, non-operating income (expenses), and extraordinary income(loss) are as follows:
Selling, general and administrative expenses were ¥3,651 million (an increase of ¥324 million compared tothe same period of the previous fiscal year). This was attributable mainly to an increase in experimentation andresearch expenses stemming primarily from the development of the Venture business class seats for other aircraftmodels, which more than offset decreases in personnel expenses, warranty expenses, and sales commissions.
In terms of non-operating income (expenses), an expense of ¥175 million was reported due mainly to anincrease in interest expenses, despite a rise in foreign exchange gains resulting from the depreciation of the yen
in the foreign exchange market from the end of the previous fiscal year (an expense of ¥818 million in the same
period of the previous fiscal year).
As for extraordinary income (loss), an income of ¥300 million was reported (a loss of ¥640 million in thesame period of the previous fiscal year), owing principally to ¥511 million recognized in subsidy income under
extraordinary income, such as subsidies for employment adjustment due to the temporary leave of employees,
and ¥137 million recognized in reversal of provision for loss on compensation under extraordinary income. This
more than offset ¥213 million recognized in loss related to COVID-19 under extraordinary loss, which consistedof running costs including fixed costs resulting from the temporary leave of employees, and ¥99 million
recognized in loss on liquidation of business under extraordinary loss, which comprised restoration and othercosts associated with the reorganization of production bases.

3

Business performance by segment is as follows.
[Aircraft Interiors Business]
In the aircraft interiors business, net sales decreased from the same period of the previous fiscal year, largely
because shipments of galleys and lavatories decreased as a result of aircraft manufacturers being forced to further
reduce production and change production schedules due mainly to the impact of the spread of COVID-19.
Nevertheless, an ordinary income was reported primarily because the efforts to reduce cost of sales bore fruit,
additional sales resulted from specification change requests from customers to aircraft interiors in certain
programs, and foreign exchange gains were recorded.
As a result, the aircraft interiors business posted net sales of ¥11,890 million (down ¥6,038 million comparedto the same period of the previous fiscal year) and ordinary income of ¥851 million (ordinary loss of ¥3,455
million in the same period of the previous fiscal year).
[Aircraft Seat Business]
In the aircraft seat business, net sales decreased from the same period of the previous fiscal year, chiefly on
account of changes to the delivery dates made by customers mainly as a result of the impact of the spread of
COVID-19. However, whereas an ordinary loss was reported due mainly to the decrease in net sales, the loss
contracted compared to the same period of the previous fiscal year as the efforts to reduce cost of sales yielded
positive results and the shipments of unprofitable custom-made products declined.
As a result, the aircraft seat business posted net sales of ¥913 million (down ¥2,739 million compared to thesame period of the previous fiscal year) and ordinary loss of ¥1,390 million (ordinary loss of ¥1,791 million in
the same period of the previous fiscal year).
[Aircraft Components Business]
In the aircraft components business, despite the postponement of shipments of heat exchangers and otherequipment mainly related to defense contracts to the quarterly third quarter of FY 2021 or later, net sales increased
from the same period of the previous fiscal year, due in part to an increase in shipments of CFRP structure parts
and aircraft engine parts for commercial aircraft products. Meanwhile, an ordinary loss was reported due mainly
to a decrease in the shipments of profitable products, despite the increase in net sales.
As a result, the aircraft components business posted net sales of ¥1,943 million (up ¥212 million compared tothe same period of the previous fiscal year) and ordinary loss of ¥247 million (ordinary loss of ¥102 million in
the same period of the previous fiscal year).
[Aircraft Maintenance Business]
In the aircraft maintenance business, net sales increased from the same period of the previous fiscal year as
the number of completed construction contracts rose for certain programs in aircraft maintenance. Meanwhile,
an ordinary income was reported due mainly to the increase in net sales.
As a result, the aircraft maintenance business posted net sales of ¥3,730 million (up ¥1,182 million comparedto the same period of the previous fiscal year) and ordinary income of ¥113 million (ordinary loss of ¥60 million
in the same period of the previous fiscal year).
[Others]
In the Others segment, which includes the businesses of the consolidated subsidiary Orange JAMCO
Corporation and consists chiefly of inter-segment transactions, including assistance work in the aircraft interiors
business, an ordinary loss was reported due mainly to a decline in workloads resulting from the closure of the
production base in Tachikawa.
As a result, the Others segment posted net sales of ¥0 million (¥0 million in the same period of the previous
fiscal year) and ordinary loss of ¥14 million (ordinary income of ¥0 million in the same period of the previous
fiscal year).

4(2) Explanation of Financial Position[Assets, liabilities and net assets]
Total assets as of September 30, 2021 amounted to ¥95,899 million, down ¥5,337 million from the end of theprevious fiscal year. Of such, total current assets decreased by ¥5,087 million from the end of the previous fiscal
year, due mainly to a decrease in notes and accounts receivable – trade, and contract assets (down ¥3,054 million
compared to the end of the previous fiscal year), a decrease in work in process (down ¥5,369 million comparedto the end of the previous fiscal year) and a decrease in raw materials and supplies (down ¥1,626 million
compared to the end of the previous fiscal year), despite an increase in cash and deposits (up ¥3,998 million
compared to the end of the previous fiscal year). Total non-current assets decreased by ¥250 million from the endof the previous fiscal year due to a decrease in property, plant and equipment (down ¥298 million compared tothe end of the previous fiscal year) and a decrease in intangible assets (down ¥251 million compared to the endof the previous fiscal year) as a result of relatively limited investment for the second quarter of FY 2021. Total
liabilities amounted to ¥80,974 million, down ¥3,745 million from the end of the previous fiscal year. This was
attributable primarily to a decrease in short-term loans payable (down ¥1,248 million compared to the end of theprevious fiscal year) and a decrease in electronically recorded obligations – operating (down ¥1,000 million
compared to the end of the previous fiscal year).
Total net assets amounted to ¥14,925 million, down ¥1,592 million from the end of the previous fiscal year.
This was due primarily to a decrease in retained earnings as a result of the application of the Revenue Recognition
Accounting Standard, etc. As a result, the equity ratio stood at 15.2%.
[Cash flows]
During the second quarter of FY 2021, cash and cash equivalents on a consolidated basis amounted to a cash
inflow of ¥4,207 million, as a result of the cash flows described below.
(Cash flows from operating activities)
During the second quarter of FY 2021, net cash provided by operating activities amounted to a cash inflow of¥6,545 million. This was due mainly to a decrease in notes and accounts receivable – trade.
(Cash flows from investing activities)
During the second quarter of FY 2021, net cash used in investing activities amounted to a cash outflow of¥113 million. This was due mainly to purchase of property, plant and equipment.
(Cash flows from financing activities)
During the second quarter of FY 2021, net cash used in financing activities amounted to a cash outflow of¥2,290 million. This was due mainly to repayment of loans payable to financial institutions.
(3) Explanation of Consolidated Financial Results Forecast and Other Forward-looking Information
The Group’s operating results for the second quarter of FY 2021 increased in terms of income compared tothe consolidated financial results forecast announced on May 11, 2021. This was due to the concentration of
additional sales involving changes in customer specifications in the aircraft interiors business in the quarterly
first quarter of FY 2021 and the depreciation of the yen in the foreign exchange market.
The consolidated financial results forecast for FY 2021 remains unchanged as the Group assumes that theuncertain business environment will continue for the time being due to the spread of COVID-19 (and its variants)
and the announcements of production adjustments by some aircraft manufacturers.
The exchange rate assumed for the consolidated financial results forecast remains unchanged from ¥103 per
US$1 at this time.

5

2. Quarterly Consolidated Financial Statements and Primary Notes(1) Quarterly Consolidated Balance Sheets(Thousand yen)
As of March 31, 2021
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Notes and accounts receivable - trade, and contract
assetsMerchandise and finished goods
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Intangible assets
Investments and other assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Notes and accounts payable - trade
Electronically recorded obligations - operating
Short-term loans payable
Current portion of long-term loans payable
Income taxes payable
Advances received
Accrued expense-salary
Provision for loss on construction contracts
Other
Total current liabilities
Non-current liabilities
Long-term loans payable
Liability for employee retirement benefits
Provision for loss on compensation
Provision for product warranties
Other
Total non-current liabilities
Total liabilities

6

As of September 30, 2021

5,275,305
21,092,693

9,273,899--

18,038,261

657,983
25,880,634
20,869,999
3,268,013(111,660)
76,932,968

1,995,605
20,510,874
19,243,600
2,904,862(121,171)
71,845,933

12,782,303
1,692,365
9,829,231
24,303,899
101,236,868

12,484,151
1,440,479
10,128,719
24,053,350
95,899,283

3,726,562
3,482,624
48,118,560
1,000,000
54,034
5,516,822
276,135
4,102,485
5,095,895
71,373,119

4,061,867
2,481,925
46,869,850
660,000
88,4685,390,082
700,164
3,720,797
4,601,887
68,575,045

3,000,000
6,919,824
1,452,434
1,166,789
807,220
13,346,268
84,719,388

2,640,000
6,693,043
1,109,529
1,166,789
789,701
12,399,063
80,974,109

(Thousand yen)
As of March 31, 2021
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Accumulated adjustment for employee retirement
benefits
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

7

As of September 30, 2021

5,359,893
4,318,925
6,360,683(31,205)
16,008,296

5,359,893
4,318,925
4,679,824(31,205)
14,327,437

156,385
17,776

206,994
38,87836,052

49,400210,214
298,969
16,517,480
101,236,868

295,273
302,463
14,925,174
95,899,283

(2) Quarterly Consolidated Statements of Income and Comprehensive Income
Quarterly Consolidated Statements of Income
Second Quarter of the Fiscal Year (from April 1 to September 30)(Thousand yen)
The second quarter of FY 2020

The second quarter of FY 2021

25,860,226
27,124,700(1,264,473)
3,326,898(4,591,371)

18,477,909
15,338,073
3,139,835
3,651,587(511,751)

8,834
1,049
-

3,962
1,140
114,980

7,934

41,276

66,622
20,78546,243
151,470

38,065
16,29355,041
270,761

209,378
466,185
215,494
78,789969,848(5,409,749)

245,709168,280
32,494446,485(687,475)

418,023
418,023

511,3391,444
137,791
650,575

25,245
1,033,493
1,058,739(6,050,464)
5,255(1,723,667)(1,718,412)(4,332,052)(37,336)

26,652
213,476
10,87699,294350,300(387,200)
61,821(51,987)(350,322)(340,488)(46,711)497(4,294,715)(47,208)

Net sales
Cost of sales
Gross profit (loss)
Selling, general and administrative expenses
Operating income (loss)
Non-operating income
Interest income
Dividend income
Foreign exchange gains
Share of profit of entities accounted for using equity
methodInsurance income
Subsidy income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Compensation expenses
Other
Total non-operating expenses
Ordinary income (loss)
Extraordinary income
Subsidy income
Reversal of extra retirement payments
Reversal of provision for loss on compensation
Total extraordinary income
Extraordinary loss
Loss on disposal of non-current assets
Loss related to COVID-19
Extra retirement payments
Loss on liquidation of businessTotal extraordinary loss
Income (loss) before taxes
Income taxes – current
Income taxes – refund
Income taxes – deferred
Total income taxes
Net income (loss)
Net income (loss) attributable to non-controlling interests
Net income (loss) attributable to shareholders of parent
company

8Quarterly Consolidated Statements of Comprehensive Income
Second Quarter of the Fiscal Year (from April 1 to September 30)(Thousand yen)
The second quarter of FY 2020 The second quarter of FY 2021
Net income (loss)
Other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Adjustment for employee retirement benefits
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to shareholders ofparent company
Comprehensive income attributable to non-controllinginterests

9(4,332,052)(46,711)

9,236(101,293)
27,448(64,609)(4,396,661)

50,60924,09813,34788,056
41,344(4,345,026)

37,850(51,635)

3,493

(3) Quarterly Consolidated Statements of Cash Flows
Second Quarter of the Fiscal Year (from April 1 to September 30)(Thousand yen)
The second quarter of FY 2020
Cash flows from operating activities
Income (loss) before taxes
Depreciation
Increase (decrease) in liability for employee retirement
benefits
Increase (decrease) in provisions
Interest and dividend income
Interest expenses
Foreign exchange losses (gains)Share of loss (profit) of entities accounted for using
equity method
Loss related to COVID-19
Subsidy income
Decrease (increase) in notes and accounts receivable trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable trade
Increase (decrease) in advances received
Decrease/increase in consumption taxes
receivable/payable
Other
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes paid
Income taxes refund
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of investment securities
Payments of loans receivableCollection of loans receivable
Decrease (increase) in time deposits
Other
Net cash provided by (used in) investing activities
Cash flows from financing activities
Increase in short-term loans payable
Decrease in short-term loans payable
Proceeds from long-term loans payable
Repayments of long-term loans payable
Repayments of lease obligations
Cash dividends paid
Cash dividends paid to non-controlling interests
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents, beginning of period
Cash and cash equivalents, end of period10

The second quarter of FY 2021

(6,050,464)
1,205,160(387,200)
1,010,563

32,336(208,395)

555,891(9,883)
209,378(118,505)

214,687(5,102)245,709
30,981(7,934)(41,276)

1,033,493(418,023)

213,476(511,339)

9,956,648

5,051,967(4,495,480)(227,643)(7,244,681)(671,844)(1,504,024)

1,844,182(336,274)(24,584)(283,154)(7,475,519)
9,883(192,171)(151,407)(7,809,214)

193,762
6,727,944
5,075(238,060)(34,647)
85,393
6,545,704(544,865)
780
(405)
1,078
53,460(238,054)(728,006)(273,167)
6,706
(300)
(8,640)410
219,600(58,058)(113,448)

31,624,614(23,647,007)(194,742)(538,877)(24,580)
7,219,405

40,197,120(41,604,120)
300,000(1,000,000)(181,992)(1,270)(2,290,263)(138,630)

65,741(1,456,445)
7,167,370
5,710,925

4,207,734
3,946,665
8,154,399

(4) Notes to Quarterly Consolidated Financial Statements(Notes on going concern assumption)
There is no relevant information.
(Notes in the case of significant changes in shareholders’ equity)
There is no relevant information.

(Changes in accounting policies)
The second quarter of FY 2021
(from April 1, 2021 to September 30, 2021)
The Group has applied the “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29,
March 31, 2020, hereinafter referred to as the “Revenue Recognition Accounting Standard”) since thebeginning of the quarterly first quarter of FY 2021, and recognizes revenue in the amount expected to bereceived in exchange for promised goods or services at the time the control of those goods or services istransferred to customers. The main changes resulting from the application of the Revenue Recognition
Accounting Standard are as follows:(1) Revenue from export transactions involving delivery of goods was previously recognized at the timeof shipment; however, revenue is recognized at the time the burden of risk is transferred to customers,in accordance with trade terms defined mainly by Incoterms rules.
(2) Revenue from sales related to design and development was previously recognized in proportion to thenumber of aircraft for which our products are adopted; however, revenue is recognized in a lump sum
at the time of shipment of our products for the aircraft for which our products are adopted for the firsttime.
The Company has applied the Revenue Recognition Accounting Standard, etc. in accordance with thetransitional treatment as provided for in the proviso of Paragraph 84 of the Revenue Recognition AccountingStandard. The cumulative effect of retroactively applying new accounting policies prior to the beginning of
the quarterly first quarter of FY 2021 is added to or deducted from retained earnings at the beginning of thequarterly first quarter of FY 2021, and new accounting policies have been applied to the balance from the
beginning of the said period.
As a result, for the second quarter of FY 2021, net sales decreased by ¥430,486 thousand, cost of sales
decreased by ¥393,551 thousand, and operating loss, ordinary loss, and loss before taxes each increased by¥36,935 thousand, compared with the previous method. Retained earnings at the beginning of the period
decreased by ¥1,633,650 thousand.
As a result of the application of the Revenue Recognition Accounting Standard, etc., “notes and accounts
receivable – trade,” stated under “current assets” in the consolidated balance sheets for the previous fiscal
year, is included in “notes and accounts receivable – trade, and contract assets” from the quarterly second
quarter of FY 2021. The Company has made no reclassification for the previous fiscal year by using the newpresentation method in accordance with the transitional treatment as provided for in Paragraph 89-2 of the
Revenue Recognition Accounting Standard. Furthermore, the Company does not state information on the
breakdown of revenue generated from contracts with customers for the second quarter of FY 2020 inaccordance with the transitional treatment as provided for in Paragraph 28-15 of the “Accounting Standard
for Quarterly Financial Reporting” (ASBJ Statement No. 12, March 31, 2020).

11

The second quarter of FY 2021
(from April 1, 2021 to September 30, 2021)
The Company has applied the “Accounting Standard for Fair Value Measurement” (ASBJ Statement No.
30, July 4, 2019, hereinafter referred to as the “Fair Value Measurement Accounting Standard”), etc. since thebeginning of the quarterly first quarter of FY 2021, applying new accounting policies defined in the Fair Value
Measurement Accounting Standard, etc. over the future in accordance with the transitional treatment asprovided for in Paragraph 19 of the Fair Value Measurement Accounting Standard and in Paragraph 44-2 ofthe “Accounting Standard for Financial Instruments” (ASBJ Statement No. 10, July 4, 2019). This application
has no impact on the Company’s quarterly consolidated financial statements.
(Additional information)
The second quarter of FY 2021
(from April 1, 2021 to September 30, 2021)
The Group makes accounting estimates for items including impairment loss on non-current assets andrecoverability of deferred tax assets, based on information available at the time of preparation of the quarterly
consolidated financial statements.
In making accounting estimates, the Group has formulated its sales plan with the assumption that air
passenger demand will recover to pre-COVID-19 levels in or around 2024. As for income, the Group has
made accounting estimates based on the expectation that its income will recover to the level of FY 2019,
before the COVID-19 pandemic, in FY 2022 due to various measures, including business process reforms.
There are no significant changes from the content of the accounting estimates related to the COVID-19
pandemic included in “Notes (Significant accounting estimates)” in our securities report for the previous fiscal
year.
(Quarterly Consolidated Statements of Income)Subsidy income¥511,339 thousand in subsidy income, such as subsidies for employment adjustment due to the temporary leaveof employees, has been recognized under extraordinary income.
Loss related to COVID-19¥213,476 thousand in loss related to COVID-19 has been recognized under extraordinary loss for running costs,
including fixed costs resulting from the temporary leave of employees, as operations significantly declined due tothe global spread of COVID-19 and a declaration of a state of emergency issued by the government.
Loss on liquidation of business¥99,294 thousand in loss on liquidation of business has been recognized under extraordinary loss for restoration
costs involving reorganization of production bases.

12

(Segment information, etc.)[Segment information]
I. For the second quarter of FY 2020
1. Information on net sales and income (loss) by reportable segment(Thousand yen)
Aircraft
Interiors
Business
Net sales
Net sales to outside
customers
Inter-segment net sales ortransfers
Total
Segment income (loss)

Reportable segment
Aircraft
Aircraft
Aircraft Seat
Components MaintenanceBusiness
Business
Business

Total

Others(Note)

Total

17,928,421

3,652,993

1,731,255

2,547,555

25,860,226-

25,860,226

209,067

72,874

1,146

10,629293,719

54,212347,932

18,137,489(3,455,749)

3,725,868(1,791,572)

1,732,402(102,585)

2,558,185(60,814)

26,153,945(5,410,721)

54,212972

26,208,158(5,409,749)(Note) The Others segment includes the businesses of affiliate Orange JAMCO Corporation. Orange JAMCO
Corporation is a special-purpose subsidiary, dedicated to promoting the employment of people withdisabilities and provides assistance work in the Company’s factories, which is one of the corporate social
responsibilities.
2. Differences between the total amount of income (loss) of reportable segments and the amounts in the Quarterly
Consolidated Statement of Income and the major details of such differences(Matters relating to adjustment of differences)(Thousand yen)
IncomeReportable segments total
Income of Others
Ordinary income in the Quarterly Consolidated Statement of
IncomeAmount3. Information on impairment loss on non-current assets and goodwill by reportable segment
There is no relevant information.

13(5,410,721)
972(5,409,749)

II. For the second quarter of FY 2021
1. Information on net sales and income (loss) and information on breakdown of revenue by reportable segment(Thousand yen)
Aircraft
Interiors
Business
Net sales
Revenue generated fromcontracts with customers
Net sales to outside
customers
Inter-segment net sales ortransfers
Total
Segment income (loss)

Reportable segment
Aircraft
Aircraft
Aircraft Seat
Components MaintenanceBusiness
Business
Business

Total

Others(Note)

Total

11,890,088

913,789

1,943,876

3,730,154

18,477,909-

18,477,909

11,890,088

913,789

1,943,876

3,730,154

18,477,909-

18,477,909

191,467

-

2,480

5,665

199,61232,006

231,618

12,081,556
851,134

913,789(1,390,465)

1,946,356(247,168)

3,735,820
113,728

18,677,522
32,006(672,770) (14,704)

18,709,528(687,475)(Note) The Others segment includes the businesses of affiliate Orange JAMCO Corporation. Orange JAMCO
Corporation is a special-purpose subsidiary, dedicated to promoting the employment of people withdisabilities and provides cleaning and assistance work in the Company’s facilities, which is one of thecorporate social responsibilities.
2. Differences between the total amount of income (loss) of reportable segments and the amounts in the Quarterly
Consolidated Statement of Income and the major details of such differences(Matters relating to adjustment of differences)(Thousand yen)
IncomeAmountReportable segments total
Income of Others
Ordinary income in the Quarterly Consolidated Statement of
Income(672,770)(14,704)(687,475)

3. Information on impairment loss on non-current assets and goodwill by reportable segment
There is no relevant information.
4. Changes in the measurement method for reportable segments
As stated in “Changes in accounting policies,” the Company has applied the Revenue Recognition AccountingStandard, etc. since the beginning of the quarterly first quarter of FY 2021 and changed the accounting method
for revenue recognition. The measurement method for the amounts of income (loss) by reportable segment has
been changed accordingly.
As a result, net sales of aircraft interiors business decreased by ¥352,657 thousand and segment income
decreased by ¥47,453 thousand, net sales of aircraft seat business decreased by ¥62,370 thousand and segment
loss decreased by ¥13,147 thousand, and net sales of aircraft components business decreased by ¥15,458 thousandand segment loss increased by ¥2,629 thousand for the second quarter of FY 2021, compared with the previous
method.

14

3. Others
Significant Events Regarding Going Concern Assumption
The Group has suffered a significant impact from the spread of COVID-19, including a drop in sales of cabin
retrofit interiors and spare parts for airlines due to a decrease in aircraft operations, in addition to a significant
drop in shipments of interiors and seats following the reduced production and changes in production schedules
by aircraft manufacturers. Operating loss, net loss attributable to shareholders of parent company, and negative
cash flows from operating activities were recognized in the previous fiscal year, and in the second quarter of FY
2021, operating loss and net loss attributable to shareholders of parent company have been recognized. As a result,the Group understands that there are events or conditions that may cast significant doubt on going concern
assumption.
Under such an unprecedented situation, the Group has carried out a review of the production plan, reorganizedproduction bases, and is making efforts to reduce fixed costs through temporary leave of employees andsecondment to companies outside the Group and limiting investment while striving to enhance the efficiency ofits management by reducing inventories.
The Group has determined that passenger demand will recover in stages in the future, based on the demand
forecast by the International Air Transport Association. Inquiries and orders for cabin retrofit interiors and seatsfrom airlines are recovering. The Group expects that shipments of our products will increase with the recovery
in passenger demand and the Group’s operating results will recover.
In addition, by enhancing close coordination with partner financial institutions, including the main bank, theGroup has secured ongoing support such as increases in borrowing limits and the continuation of loans. As theGroup secured necessary financing limits, it has determined that there are no material uncertainties regarding
going concern assumption.

15