nms Holdings Corporation
Overview of Financial Results
for the First Quarter of Fiscal Year Ending March 31, 2020

(JASDAQ 2162）● Net sales: Increased in all business segments
Sales were firm overall, despite a decline in demand for machine tool-related products in the EMSBusiness.
All business segments achieved YoY growth in sales.
Demand was also firm in the Human Resource Solution Business (HS Business) resulting in sales
growth, mainly in the domestic human resources business.
● Operating income: Reached 63% of previously disclosed forecast for the first half
・ HS Business: Operating income declined YoY, owing to an increase in costs accompanying
expansion of new businesses, such as contracting provision of services for foreign technicaltrainees, the establishment of a third party logistics contracting and technical logistics processing
business, and the launch of a technician dispatch business and businesses overseas. However,operating income was strong compared to the plan.
・ EMS Business: Operating income was strong overall, despite the impact from lower demand formachine tool-related products and the deterioration in labor productivity resulting from responseto the rapid increase in production relating to household appliances, a main customer industry
overseas.
・ PS Business: Operating income declined YoY due to the time lag between the steep rise in material
prices and raising product sales prices to pass on the cost. However, operating income was strong
compared to the plan. We expect the benefit from the increase in sales prices to contribute fromthe second half onward.
 Topics: Businesses in U.S. and Mexico started operating under the new structure
The businesses in the U.S. and Mexico, which were acquired from Sony Corporation, started operating
under the new structure from April 1.
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11. Financial Performance for the First Quarter of Fiscal YearEnding March 31, 2020

(Million yen)First Quarter
FYE Mar. 31,
2019 Results

First Quarter FYE Mar. 31, 2020
Results

Main Points

YoY[Net sales]

Net sales

13,742

Operating income

Ordinary income
Profit attributableto owners of parent258

203

15,249

6396

11.0%

(75.6%)(52.8%)

Sales increased for all businesssegments.
[Operating income]Declined YoY owing to higher costs
accompanying business expansion
and the time lag between the increasein material prices and pass-through of
the increase to product prices.
However, operating income was inline with the plan.

First Half
Forecast

Disclosed on May 10,
2019

Progresstoward
Forecast[Net sales]

32,000[Operatingincome]

10048％

63%[Ordinary income]Non-operating income: ¥90 million（Down ¥42 million YoY）
Non-operating expenses: ¥57 million（Down ¥130 million YoY）
[Extraordinary income] ¥2 million（Up ¥2 million YoY）

6334

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(46.3％)[Extraordinary loss] ¥1 million（Down ¥46 million YoY）

22. Financial Performance Highlights by Segment

First Quarter
FYE Mar. 31,2019 Results(Million yen)

HS Business

EMS Business

PS Business
Segment
Eliminations

Total

First Quarter FYE Mar. 31, 2020

YoYResults

Main Points

Net sales

4,524

5,376

18.8％

Segment
income9949(50.0％)

Net sales

6,422

6,708

4.5%

Segment
income

124

150

20.7％

Net sales

2,794

3,164

13.2%

Segment
income

158

(8)

―

Segment
income(123)

(128)

―

Net sales

13,742

15,24911.0%

Segment
income25863(75.6％)

Strong demand led to growth in net sales. Segmentincome declined owing to the cost of continued
advance investment in contracting provision ofservices for foreign technical trainees, logistics-related
business, and the technician dispatch business, andother business areas. Performance was in line withthe plan.
Overall net sales and segment income increased
despite the impact from the decline in demand formachine tool-related products and the deterioration inlabor productivity resulting from response to the rapid
increase in production relating to household
appliances overseas. The growth reflected theconsolidated results from the Mexico business fromthe first quarter.
Segment income declined owing to the time lag
between the steep rise in material prices and thepass-through of this increase to product prices.
However, demand was strong and we expect thebenefit from the increase in sales prices to contributefrom the second half onward.
Company-wide expenses attributable to the holding company＊ These expenses were not allocated to the individual
segments due to the migration to a holding company
structure and have thus been eliminated from segment
profits.

* HS Business: Human Resource Solution Business; EMS Business: Electronics Manufacturing Service Business; PS Business: Power Supply Business

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3

(For Reference) Financial Performance by Segment: HS BusinessJapanNet sales¥5,376 million

Overseas

Demand remained firm owing to the use of newly hired graduates and foreigntechnical trainees in the manufacturing worker dispatch/contract manufacturingbusiness.
Demand remained firm in China and ASEAN. However, there was a temporary
increase in the cost of capturing new orders at the location in Vietnam (NMSVIETNAM CO., LTD.), which operates a human resources business and contract
manufacturing business, and an increase in costs accompanying the launch ofbusiness in Indonesia, Laos, and elsewhere.

Although the implementation of our strategy to expand the scale of the business bothin Japan and overseas led to higher costs, we will work to reap the results quickly andimprove profitability.

5,376

99

4,000

3,000

2,000

1,000

150

4,524

Segment
incomeDown 50.0％ YoY（単位：百万円）

1004950Segment income¥49 million

5,000(Million yen)

Net sales

Segment
income(Million yen)
6,000

Net sales

Up 18.8％ YoY[Business Entity]
Nippon Manufacturing
Service Group0Copyright© nms Holdings Corporation. All Rights Reserved.

First Quarter
FYE Mar. 31, 2019

First Quarter
FYE Mar. 31, 202004

(For Reference) Financial Performance by Segment: EMS Business
The pace of growth in machine tool-related demand slowed, due in part to the trade
friction between the U.S. and China, but demand was firm in general, mainly forexisting products.

JapanSegment
incomeUp 20.7％ YoY（単位：百万円）
6,708

6,422

・ TKR Group

350

6,000

300

5,000

250

4,000

3,000

124

2,000

[Business Entity]
・ SHIMA ELECTRONIC
INDUSTRY Group(Million yen)

1,0000Copyright© nms Holdings Corporation. All Rights Reserved.

First Quarter
FYE Mar. 31, 2019200150First Quarter
FYE Mar. 31, 2020

150
100

Segment income¥150 million(Million yen)
7,000

Segment
incomeUp 4.5％ YoY

TKR Corporation (TKR): A new plant was completed in Vietnam in April 2019 in addition
to those already established in China and Malaysia, and the businesses in the U.S. andMexico, which were acquired from Sony Corporation, started operations on April 1,2019. We are responding to the geographical multipolarization of production bycustomers in response to U.S.-China trade friction and other factors, and are working toexpand our global business structure.

Net sales¥6,708 million

Labor productivity deteriorated in Malaysia due to the response to the rapid increasein production relating to overseas household appliances, a main customer industry.
However, demand remained firm in China.

Overseas

Net sales

Net sales

5005

(For Reference) Financial Performance by Segment: PS Business・ Demand was firm as the segment completed adjustments to demand for existingproducts, moved past the hiatus in introduction of new products for new areas, andachieved a steady start in mass production of new orders.

Overall・ Segment income declined owing to the time lag between the steep rise in material
prices and the pass-through of this increase to product prices. However, we expect
the benefit from the increase in sales prices to contribute from the second half
onward and expect segment income in line with our forecast for the full year.

Net sales¥3,164 million

We are utilizing our accumulated expertise in power supply technology and arereceiving many order inquiries on LiB secondary battery packs. We aim to achieve
growth in both net sales and segment income by strengthening the business baseand introducing new products.

Up 13.2％ YoY(Million yen)

(Million yen)
3,500

Segment
income

1,000[Business Entity]

200

158
150

Segment
income1,500

Net sales

Net sales

2,000

0

10050(8)0-50-500

First Quarter
FYE Mar. 31, 2019
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300
250

2,500500

Power Supply
Technology CO., LTD.

（単位：百万円）

2,794

Segment income(¥8 million)

3,000

350

3,164

First Quarter
FYE Mar. 31, 2020

63. Financial Performance Highlights (B/S)(Million yen)March 31, 2019

June 30, 2019

ChangeCurrent assets

22,08222,855773

Non-current assets

7,380

8,187

806

Property, plant andequipment

5,612

6,023

410

Intangible assets

540

923

383

1,227

1,241

13

Total assets

29,462

31,042

1,580

Total liabilities

23,71725,275

1,558

Current liabilities

21,744

21,365

(378)

1,973

3,910

1,936

Total net assets

5,744

5,766

22

Total liabilities andnet assets

29,462

31,042

1,580

Investment and otherassets

Non-current liabilities

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7(For Reference) nms Group: Three Business Segments

Bringing Japanese Manufacturing Quality to the WorldThis is the rallying cry of the nms group.
Our business is a combination of three business segments that meet the many different needs of our customers,from the Human Resource Solution Business, to the EMS (Electronics Manufacturing Service) Business which
performs contract manufacturing and achieves production efficiency, and the Power Supply Business, which
engages in the development, manufacturing, and sale of power sources that ensure the safety and security ofmany types of equipment.

ＨＳＥＭＳ

ＰＳ

Human Resource SolutionBusinessElectronics Manufacturing
Service Business

Power SupplyBusiness

Staff members who are highly knowledgeable aboutproducts, manufacturing processes and production
sites are taking an active role in each region ofJapan, China and ASEAN member countries.

This business implements total solutions that help
customers to improve their competitive strength.

This business offers improved solutions that are a
step above the rest with our technical expertise as a
dedicated power source manufacturer.

Legal Entity

Legal Entity

Legal Entity

Nippon Manufacturing ServiceCorporation

SHIMA ELECTRONIC INDUSTRYCO., LTD.
TKR Corporation

Power Supply TechnologyCO., LTD.

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8

(For Reference) nms Group Business Structure

Main Consolidated Subsidiaries(fiscal year end for each company listed in parentheses)

Countries/Regions
EnteredMain Business Activities

Human Resource Solution Business (HS Business)•••

Nippon Manufacturing Service Corporation (Mar.)
Sino-Japan Stafftraining and Dispatch Co., Ltd. (Dec.)
Sino Manufacturing Service Corporation (Dec.)

Japan
China
VietnamThailand•••Worker dispatch for manufacturing
Customer service for repairs
Dispatch of engineers

JapanHong Kong(China)
Malaysia•

Electronics Manufacturing Service business (substrate mounting, substrateassembling, simple pressing, resin molding, assembly, etc.)
Labor-saving Device Manufacturing/Sales businessJapanHong Kong(China)•Electronics Manufacturing Service Business (EMS Business)••

SHIMA ELECTRONIC INDUSTRY CO., LTD. (Dec.)
TKR Corporation (Dec.)•Power Supply Business (PS Business)••

Power Supply Technology CO., LTD. (Dec.)
TKR Corporation (Dec.)•••

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Custom power supply (low/high-voltage): development, design,manufacturing, sales
Magnet roll: development, design, manufacturing, sales
A wide variety of transformers (switching/high-voltage transformers):
development, design, manufacturing, sales
Development, design, manufacture and sale of battery management
system related products9(For Reference) Corporate Profile
http://www.n-ms.co.jp/english/Company Name

nms Holdings Corporation

Head Office

Tokyo Opera City Tower 45F, 3-20-2 Nishi-shinjuku, Shinjuku-ku, Tokyo
163-1445, Japan

Representative

Fumiaki Ono, President and CEO

Capital500,690,000 yen (as of June 30, 2019)

Stock Exchange
Listings

Tokyo Securities Exchange (JASDAQ market)
Securities Code 2162

Business Activities

Integration of group businesses, management of operations, etc. in the
Human Resource Solution (HS) Business,Electronics Manufacturing Service (EMS) Business, andPower Supply (PS) Business

Main Consolidated
Subsidiaries

Nippon Manufacturing Service Corporation
SHIMA ELECTRONIC INDUSTRY CO., LTD.
TKR Corporation
Power Supply Technology CO., LTD.

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10None of the information in these materials constitutes a solicitation to purchase or sell shares innms Holdings Corporation.
The financial forecasts and other forward-looking statements in these materials are based on
information available at the time these materials were produced as well as certain assumptions
deemed reasonable by the company. Actual results may differ substantially due to various risks anduncertainties.
nms Holdings Corporation does not make any recommendations, warranties, etc. concerning theinformation contained in these materials, and accepts no liability whatsoever for any damages
incurred.
Contact for inquiries:
nms Holdings Corporation
Corporate Communications & IR Dept.
Tel: +81-3-5333-1737
E-mail: nms-ir@n-ms.co.jp

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11