February 27, 2023
Company name:

UT Group Co., Ltd.

Representative:

Yoichi Wakayama, President,
Representative Director & CEO(Securities code:2146, TSE Prime Market)

For inquiries:

Takahito Yamada, Senior Executive
Officer and Division Manager,
General Affairs DivisionTel:+81-3-5447-1710

Notice Regarding Decision on the Shareholder Return Methodand Dividend Forecast for FY3/2023
UT Group resolved at its Board of Directors meeting held on February 27, 2023 to buy back its own shares as
its shareholder return for FY3/2023.
1.

Shareholder return method for FY3/2023

We recognize returning profits to shareholders as an important management issue. To achieve a total return
ratio of 30% as our baseline target, we adopted the policy of making a comprehensive assessment of the shareprice level, business environment, and other factors and on that basis to deliver optimal shareholder returns
through dividend payment or share buyback that helps to improve capital efficiency.
Regarding a shareholder return policy for FY3/2023, in light of the business environment stated below we havedecided not to pay a cash dividend but to buy back our own shares.
2.

Background of the decision

FY3/2023, the third year of our Fourth Medium-term Business Plan, has been positioned as the year in which
we will strive to improve profitability by establishing a solid business foundation for the UT Group to accelerate
growth over the medium to long term. We have been building a business foundation for the Group’s sustainablegrowth. Specific measures include organizational restructuring including the integration of operatingcompanies so as to optimize the allocation of personnel, improvement in labor productivity throughstandardization of operations, and improvement in the efficiency of hiring activities through the integration ofhiring databases and improvement of hiring operations. As a result, EBITDA of 15 billion yen, which was set
as the target for FY3/2024 in the initial version of the Medium-term Business Plan, has been moved forward
by one year, and the probability of reaching this target in FY3/2023 is increasing. We can therefore say that
we have further evolved our ability to generate profits.
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For FY3/2023, stock-based compensation expenses of 5.5 billion yen have been recorded in light of theincreased probability of achieving the performance conditions for the exercise of stock acquisition rights
resolved at the meeting of the Board of Directors held on May 20, 2020. However, we expect to set a significant
record high in earnings if the impact of stock-based compensation expenses is excluded. Considering the EPS
growth rate excluding stock-based compensation expenses that do not involve cash-out, as the actual profit
growth potential of the UT Group, the share price is at an extremely undervalued level, as shown in the tablebelow, and we have determined that the share buyback method is appropriate for shareholder returns for
FY3/2023. That is why we intend to buy back our own shares on a scale equivalent to 30% of net income
attributable to owners of the parent, excluding the impact of stock-based compensation expenses, for
FY3/2023. As a result, when calculated using the previously announced forecast of profit attributable to ownersof the parent taking into account the impact of stock-based compensation expenses, the total payout ratio
would be approximately 82%.
We would like to express our gratitude to the shareholders for their continued support during the ongoing
Fourth Medium-term Business Plan, which began with the spread of COVID-19 and continues to present
uncertainty in the business environment.
FY3/2023(forecasts)
excluding the impact
of stock-based
compensation
expenses

FY3/2022

FY3/2023(forecasts)

3,140 mln yen

3,200 mln yen

8,768 mln yen

77.81 yen

79.28 yen217.25 yen

EPS growth rate (1)-27.0%

1.9%

179.2%PER (2)

39.91

28.97

10.57

-1.48

15.32

0.06

Net profit attributable to UT GroupEPS* PER for FY3/2023 as of February 24, 2023

PEG ratio = (2)/(1)

PEG ratio compares the price earnings ratio (PER) and the EPS growth rate, and is referred to when determining theshareholder return method as an indicator of the share price level relative to growth potential
・PEG ratio of less than 1 time: Considered to indicate that the stock price is undervalued
・PEG ratio of over 2 times: Considered to indicate that the stock price is fully valued by the market

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3.

Dividend forecast
Annual dividend per share (yen)2Q-end
3Q-endFY-end1Q-endFY3/2023
Previous forecasts

TBD

TBD

0.00

0.00

Ordinary div.
24.00

Ordinary div.
24.00

FY3/2023
Revised forecasts
FY3/2023 Results

0.00

0.00

0.00

FY3/2022 Results

0.00

0.00

0.00

Total(Reference) Performance and forecast of the shareholder return policy(Million yen)

FY3/2018

FY3/2019

FY3/2020

FY3/2021

FY3/2022

FY3/2023(forecasts)

3,534

4,968

4,509

4,299

3,140

3,200－

2,499－

2,663

968

－

Amount of sharesbought back

1,060－－－－

2,630*Total return ratio

30.0%

50.3%

0.00%

62.0%

30.8%

82.2%*

Profit attributable toowners of theparent
Total dividend
amountNote: Current forecasts calculated based on consolidated earnings forecasts for the fiscal year ending March 31, 2023

Details of the share buyback resulting from this decision (i.e., total number of shares to be repurchased, totalacquisition price, and repurchase period) will be disclosed in a timely manner as soon as they are determined,
in the form of "Notice Concerning Share Buyback ".
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