FINANCIAL REPORT
April 2020 - March 2021

Business Policies
1. Basic Management Policy
Amano's management philosophy is to create new values and contribute to the realization ofa safe, comfortable and a wholesome society in the fields of "People & Time" and "People &Environment."
Under this management philosophy and based on an optimal governance structure that responds to changes in the business environment, we will strive to maximize corporate value by
ensuring sustained growth through the creation of new businesses and markets with a mediumto-long term global perspective, in addition to expanding our existing businesses. Furthermore,
we will aim to become a company that has the trust and high regard of all the stakeholders
including customers, business partner companies, shareholders, employees and the local community by constantly returning a fair profit earned through business activities.

2. Medium-long term business strategy of the company
Amano launched a new Medium-term Business Plan for the three years from April 2020 toMarch 2023. An outline of the plan is set out below.
[1] Basic policies
Under the 8th Medium-term Business Plan, with the Group's management concept of "The 3rd
Stage Towards a 100-year Company-Establishing a solid business foundation that leads to sustainable growth," we will address the following two key issues towards achieving the goal ofenhancing our corporate value while keeping ESG management in mind and emphasizing theestablishment of a business management system that is suitable for the era of globalization andfurther efforts to ensure thorough compliance as a foundation.
(i) Investments in growth drivers
In response to the rapidly evolving digital transformation movements, Amano will vigorously push forward with digitalization and the effective use of IT in each business area. In
particular, we will invest steadily in growth drivers including strategic investments in software assets, IoT, AI, etc., to realize sustainable growth in sales and profit.
We will also continue our investments in venture companies and startup companies and
M&A activities, which started under the 7th Medium-term Business Plan, to establish thesixth core business.
(ii) Establishment of unparalleled competitive advantage based on synergy among the strengthsof each business department
After analyzing and grasping the strengths of each business division and group companies
all over again, we will execute strategic investments shown in (i) above to further strengthen
them, while ensuring synergy among them to further enhance our competitive advantages.
In the course of this initiative, Amano will strive to deepen and enhance the customer basethat we have developed and to further enhance the product lineup by anticipating market
trends.
The target of the 8th Medium-term Business Plan is the achievement of the "AVERAGE 12% in
the 3KPIs."(1) Operating profit ratio (OPR): Achieve at least 13%(2) Cash conversion cycle (CCC): Shorten by at least 12%(3) Return on equity (ROE): Achieve at least 11%
Measures and issues for each region under these basic policies are as follows:
1. Japanese market
In the Japanese market, we will reinforce ties among domestic Group companies and also withother companies outside the Group and strengthen our capacity to provide holistic solutions(which cover hardware, software, and services) across all business fields both qualitatively andquantitatively. We will also promote the "3-in-1 activity” leveraging the strength of direct sales
and support. Under our medium- to long-term strategies based on market and competitive
analyses, the Group will aim to establish an unparalleled competitive advantage in each business by building a sales capability that fits the market trend to reinforce the relationship withexisting customers and to expand transactions with new customers.

1

In the Information Systems, the enactment of the bills related to the Work Style Reform in April
2019 was followed by the start of their application to small and medium-sized businesses in
April 2020. Employers are required to keep track of working hours accurately to curb long
working hours. In addition, employers are now legally obliged to conduct complex working
hour management in response to the introduction of equal pay for equal work and changes
in work style due to side jobs, working from outside the office, which grew sharply under the
COVID-19 pandemic, etc., thus creating a constant demand for time & attendance management systems to upgrade or rebuild their working hour management systems and ensure legal
compliance. Demand for cloud services is also expected to increase as the need for various
administrative procedures to become available electronically grows, in addition to the need to
track employees’ work status due to an increase in the number of people working from outside
the office.
In response to this market environment, for the small-to-medium sized enterprise (SME) market, we will continue to market holistic solutions with the “TimePro-NX,” which is an integrated software package to manage time & attendance, human resource management, andpayroll, to further increase market share. At the same time, for the medium-to-large enterprisemarket where demand is firm, we will work to strengthen solutions for time & attendance, human resource management, payroll, accounting software, and consulting services by collaborating with CREO CO., LTD., utilizing “TimePro-VG.” We will aim for continued expansion by
improving the functions of our cloud-based time & attendance management systems, which
can be customized to reflect each company’s work rules, in response to the strong demand forcloud services that has arisen as new work styles such as remote working become firmly embedded in the workplace. We will also strengthen our business development efforts around attendance management for teachers, doctors, and the like, which is expected to grow from now
on and promote the expansion of "e-AMANO" cloud service to offer the electronic processingof various notifications and declarations for employees from hiring through retirement. In thisway, we will maintain and expand our customer base with our one-stop services encompassing hardware, software, services, and cloud to further expand our business portfolio.
The Parking Systems continues to benefit from new demand arising from the spread of cashless payment and ticketless operation, even though parking lot utilization rates have not fully
recovered due to the effect of unstable economic conditions, and the conditions of the parking
lot market remain challenging. In addition, there are rising needs to offer solutions to reduceparking lot management costs, ensure safety and security, heighten environmental considerations, and improve user convenience, as well as to offer cloud-based services and provide
operational solutions based on ETC technology amid the trend of digital transformation.
Given these changes in the market environment, we will further strengthen partnerships withmajor parking lot management companies and provide various services through our parking
lot data center for small and medium-sized parking lot management companies while improving the functions and operability of system equipment. We will also continue to respond totransitions in the market, including the increased demand for parking reservations, the migration towards a sharing economy, and the advancement of self-driving technology. In addition,
we will continue to strengthen proposals in the commissioned parking lot management business by utilizing the data center service and strengthen and expand our efforts for facilities
such as bicycle parking lots, security gates, and toll roads in order to expand our business.
The Environmental Systems had faced weak corporate appetite for capital investment both inJapan and overseas following the deterioration in business sentiment, but businesses started toresume their investment as the Chinese economy began recovering.
Given this market environment, in Japan we will aim to increase the quantity of sales of standard equipment by rolling out new products and applying existing products to new areas, andexpand business domains including the pharmaceutical, food, and cosmetics markets, which2are less affected by business sentiments. We will also work to strengthen our engineering capabilities and comprehensive sales, including that of peripheral equipment based on energyand labor-saving proposals as well as new service proposals leveraging IoT, by partnering withindustrial equipment manufacturers. With the rising demand to create a hygienic and safe environment, we will work to expand the sales of high-performance air purifiers to new customers, such as companies in the medical field, various service providers, and retailers.
In the Clean Systems, while the trend of companies trying to reduce cleaning costs continues, amid the aging of sanitation workers and an increase in the proportion of women among
newly hired workers, the need to improve the safety and operability of cleaning equipment has
been increasing to reduce the burden on these workers. At the same time, the need to maintain building aesthetics at a low cost and demand for cleaning work automation using robot
technology have also been increasing. Furthermore, we expect that the demand will continue
to expand with the rising consciousness for cleanliness due to the spread of COVID-19.
In response to these market conditions, we will enhance the product lineup to respond to the
expansion of the robotic cleaning market, provide various services using communication functions, and work to expand the factory market by introducing cleaning devices. We will also
strengthen recurring revenues by means of promoting maintenance contracts and increasing
the order intake for supplies, which will maintain and expand our customer base. We will also
promote comprehensive proposals for commissioned cleaning services that make full use ofcleaning robots, aesthetic maintenance, and improved hygiene management through the useof electrolytic water generators.
2. North American market
In the Parking Systems, we will aim to achieve full recovery in the financial performance of Amano
McGann, Inc. as soon as possible by expanding system sales and launching new systems in themarket to achieve a recovery in sales. In the Information Systems, we will strive to expand thebusiness by increasing the sales of Accu-Time Systems, Inc.'s time and attendance information terminals and by enhancing cloud-based products. In the Clean Systems, we will further expand thebusiness of the wooden floor sanding equipment division of Amano Pioneer Eclipse Corp., develop
new markets, and identify new business opportunities. In the Environmental Systems, Amano Time& Ecology de Mexico S.A. de C.V. will proceed with formulating strategies in the North American
market, including Mexico.
3. European market
In the Information Systems, we will further enhance our customer base by promoting Horoquartz's workforce management and access control businesses as well as by expanding cloudservices. At the same time, we will aim to expand this business into new countries other thanFrance. In the Parking Systems, we will strive to expand operations by promoting system equipment sales and developing a commissioned parking lot management business.
4. Asian market
In the Asian region, we will aim to expand Parking Systems operations by strengthening services in the commissioned parking lot management business and by expanding services into
new regions. In the Environmental Systems, we will strengthen our engineering capabilities aswell as sales and service systems for Japanese companies operating in Asia by making use of
the ties between our Group companies across Asia and our head office in Japan. We will also
work to establish a supply chain network in each region.

3[2] Numerical targets
Our present three-year Medium-term Business Plan has come into effect from April 2020 until
March 2023, in which we are aiming to achieve ¥140,000 million or higher in net sales and¥18,500 million or higher in operating profit in the FY 2022, the last fiscal year of the plan.
(Major assumptions of the numerical targets)(i)	The results for the FY2021 (year ending March 31, 2022), which marks the second yearof the 8th Medium-term Business Plan, has been revised on the assumption that Amanoand our Group companies in and out of Japan remain deeply affected by the COVID-19
pandemic. At the original planning, we expected less slight influence by the COVID-19
pandemic than the previous year, however, we are assuming that full normalization willtake time as the COVID-19 has been still spreading throughout the world.
(ii)	For unconsolidated ACJ, despite some fluctuations in net sales, the Information Systems
is expected to remain on a growth trend tail winded by the Government driven Work
Style Reform initiatives. Moreover, the Environmental Systems is expected to keep improving due to Chinese economy recovery and resumption of equipment investment in
the car industry. In addition, the Clean Systems is anticipated to increase in net sales dueto the high demand with enhancing sanitary awareness. On the other hand, the Parking
Systems will remain struggling because parking lot owners have less motivation to invest
their equipment, and return to a growth path in the FY 2022, the last fiscal year of the 8th
Medium-term Business Plan.
(iii)	Parking management services of the Parking Systems is expected to get out of the severe
situation in the FY2020 and recover both in Japan and abroad, and thus firmly positioned
as the driver of consolidated growth again in the FY 2022.
(iv)	Amano McGann Inc., in North America, which has suffered from legacy issues, will
launch a new product on the market in the middle of this fiscal year, and the company is
expected to improve their profitability from the second half of the FY2021.
Please note that the numerical targets for more two-year Medium-term Business Plan set out
below are tentative at this point. Currently, COVID-19 is causing too many uncertainties hampering realistic future planning, so we intend to review these targets appropriately according
to the future changes in the business environment, at which time, we hope to have a better
outlook for the pandemic and the economic recovery trends of each country.

Numerical targets(Millions of yen)

FY 2020
FY 2021
FY 2021
FY 2022(year ended March 2021) (year ending March 2022) (year ending March 2022)(year ending March 2023)(Results)(Original)(Revised)
Amount YoY (%) Amount YoY (%) Amount YoY (%) Amount YoY (%)
Net sales
113,598(14.6) 125,000
10.0 120,000
5.6 140,000
16.7Operating profit
9,934(38.6)
14,00040.9
12,50025.8
18,50048.0
Operating profit ratio (%)
8.7%
–
11.2%
–
10.4%
–
–
13.2%
Ordinary profit
11,017(34.7)
15,00036.2
13,50022.5
19,50044.4
Net income attributableto owners of the parent
7,248(31.4)
10,000
38.0
9,000
24.2
13,00044.4
company43. Basic Policy on Distribution of Profits and Payment of Dividends for This Fiscal Yearand the Next
Amano places great importance on our policy of paying dividends to shareholders. Our fundamental policy to return profits to shareholders is to make appropriate performance-based
distributions and to buy back shares, as it deems necessary. We aim to maintain a dividend
payout ratio of at least 40% on a consolidated basis, a net asset dividend rate of at least 2.5%,
and a total return ratio of at least 55%.
In line with this policy, taking into account our current-year operations results, we plan to pay
a year-end dividend of ¥45 per share, and the annual per-share dividend for this fiscal year
will be ¥65 (including ¥20 per share paid as the interim dividend), a decrease of ¥19 from theannual per-share dividend of ¥84 for the previous fiscal year.
In addition, we resolved to buy back our issued shares by the Board of Directors of our company on April 26, 2021. The detail of this matter is available for inspection on the website of
our company.
(https://www.amano.co.jp/English/ir/dl/news/2021/20210426_2.pdf)
As a result, the consolidated payout ratio will be 67.3%, the net asset dividend rate will be 4.4%,
and the total return ratio will be 98.3%.
With regard to the dividend for the next fiscal year ending March 31, 2022, in line with our
Basic Policy on Distribution of Profits and in view of our outlook for the next fiscal year, wecurrently aim to pay an annual per-share dividend of ¥70 (with an interim dividend of ¥25 anda year-end dividend of ¥45).
Retained earnings will be earmarked to fund effective investment aimed at the fundamental
enhancement of the Company's capacity to conduct our business operations. This will include
the expansion and strengthening of existing business fields, strategic investment in growthfields, and spending on research and development, as well as the rationalization of production
plants and equipment for the purpose of reducing costs and further improving product quality.

Hiroyuki TSUDA
President
Representative Director

5General Business Results
Business Results in the Year Ended March 31, 2021

General Business Results for This
Fiscal Year
During the consolidated fiscal year
under review, the effect of COVID-19 continues, but the Japanese
economy showed some signs ofrecovery triggered by the recovery
in the Chinese economy and theresumption of economic activities inJapan. However, it seems that the future outlook for the Japanese economy continues to be uncertain due
to the global shortage of semiconductors, the prolonged U.S.-China
trade friction, and the continuationof various social and economic restrictions to cope with the worldwide resurgence of COVID-19.
Under such business environment,
we the Amano Group have set
forth the management concept of"The 3rd Stage Towards a 100-year
Company-Establishing a solid business foundation that leads to sustainable growth" in our 8th Mediumterm Business Plan launched in April
2020, in which we will promotestrategic investments in growth drivers in order to respond to digitaltransformation (DX), and we shallestablish unrivaled competitive advantage by raising the synergistic effects of the strengths of each of ourbusiness divisions.

During the fiscal year under review,
Amano recorded sales of ¥113,598
million, down by 14.6% year-onyear. Operating profit decreased by
38.6% to ¥9,934 million, ordinar yp r o fi t we n t d ow n by 34.7% t o¥11,017 million, and net income attributable to owners of the parent
company decreased by 31.4% to¥7,248 million, resulting in decreases
in both sales and profit.
(Main factors behind the businessresults)(i)A t non-consolidated Amano,“Work Style Reform” continues
to tailwind the business, and since
the cancellation of the state of
emergency declaration in May
2020, business conditions are ona recovering trend. However, sales
were down year-on-year as business is yet to recover to last year’slevel mainly due to the effect of
the re-declaration of the state of
emergency in January 2021. Amidsuch circumstances, the Environmental Systems showed a slight
improvement where the rate ofsales decline eased as the Chinese
economy began to recover, andthe Clean Systems is also on arecovering trend as demand forcleanliness expands.
(ii)A t domestic group companies,
the parking management service
business remained weak withpeople being told to refrain fromgoing out, which reduced thenumber of people moving by car.
On the other hand, T&A cloudservices remained firm, driven by
the strong interest from customers.
(iii)In overseas markets, although
Amano McGann in North America
made progress in reducing their
fixed expenses, due to the COVID-19 curfew and protest demonstrations across the UnitedStates, sales revenue decreased
significantly, widening the deficit.
Sales in Asia and Europe also
declined due to governmentimposed curfews and otherrestraints on business activities.
However, in Europe, the sales
decline rate improved due to thestrong T&A cloud service business.
(iv)In terms of extraordinary losses,
an impairment loss of ¥1,121
million was posted due to thepoor operating results of Amano
McGann, Inc. in North America
and the relocation (switching
to leasing) of the head office ofAccu-Time Systems, Inc. in North
America.
(v)Furthermore, the net income attributable to owners of the parent company includes the federal
tax refunds in the United States.

Sales by business division
Category
Time Information System business:
Information Systems
Time Management Products
Parking Systems
Subtotal
Environment System business:
Environmental Systems
Clean Systems
Subtotal
Total(Unit: Millions of yen)

FY2019FY2020(April 1, 2019–March 31, 2020) (April 1, 2020–March 31, 2021)
Amount Ratio (%) Amount Ratio (%)

Amount%31,1103,475
65,429100,016

23.4
2.6
49.2
75.2

27,8782,856
53,854
84,590

24.6
2.5
47.4
74.5

(3,231)(618)(11,575)(15,425)(10.4)(17.8)(17.7)(15.4)

22,432
10,63533,068133,084

16.8
8.0
24.8
100.0

18,664
10,34329,007
113,598

16.4
9.1
25.5
100.0

(3,768)(291)(4,060)(19,485)(16.8)(2.7)(12.3)(14.6)

6

ChangeTime Information System business• Information Systems:
Time & attendance (T&A), payroll,human-resource management, access control, and cafeteria systems• Time Management Products:
Time recorders and time stamps• Parking Systems:
Parking and bicycle-parking space
management systems, and commissioned parking lot management service
The sales in this business totaled¥84,590 million, down by ¥15,425
million (down 15.4%) year-on-year.
The following is a breakdown ofsales by business division.

Information Systems¥27,878 million (down 10.4% year-on-year)

In this business, against the backdropof the enactment of the bills related
to the “Work Style Reform” in April
2019, the Japanese market is focusedon the labor management efforts ofcompanies to embrace digitalizationand network technologies in orderto improve productivity, make fulluse of diverse human resources, andexpand teleworking under the COVID-19 pandemic, while responding
to new statutory requirements, suchas complying with the upper limit on
working hours.
In response to these market conditions, the Company, being "Amano—
active in the area of HR (Human
Resources)," added access control
and security to the list of our "3-in1" proposal, comprising time & attendance (T&A), payroll, and humanresource management, thus striving
to bolster our activities to provide
total solutions from system ownership to system use.
Domestic sales for the current term
were as follows. For Amano, on an
unconsolidated basis, software sales
decreased by ¥1,201 million (11.8%),
hardware sales decreased by ¥1,206

million (27.8%), and sales generated
by maintenance contracts and supplies ser vices decreased by ¥220
million (4.7%) year-on-year. Softwaresales decreased because the sales of“TimePro-VG,” a piece of software
for medium-sized and large businesses, have not yet recovered to
the level of the previous year, eventhough they have been on a recovering trend since the cancellation of
the state of emergency declarationin 2020; and orders for “TimeProNX” for small to medium-sized businesses remained weak due to thecontinuation of unfavorable businessconditions for corporate customers. The decrease in hardware sales
was due to the effect of restrictions
imposed on equipment installation
work during the declaration of thestate of emergency in 2020, which
could not be offset by the orders
received in the second half of thecurrent term. The cloud ser vices
developed by Amano Business Solutions Corporation continued to perform strongly, supported mainly byan increase in the number of users
due to teleworking.
Overall overseas sales decreasedby ¥562 million (down 5.2% yearon-year), as the sales of Accu-Time
Systems, Inc. in North America decreased and the sales of Horoquartz
S.A. in Europe also decreased, eventhough they achieved growth inhighly profitable cloud services.

Time Management Products¥2,856 million (down 17.8% year-on-year)

Although there is constant demand
for standard devices, the trend toward lower prices has continued inthis business.
In this mar ket environment, theCompany has been wor king on
expanding the sales of its “TimeP@CK series” time recorders, which areequipped with aggregation software
compatible with PCs and offer improved usability and functionality, as
well as concentrating on expand7

ing its customer base through thepromotion of “User-club,” a feebased ser vice for member s. The
Company has also proposed a newusage method by launching compact
time recorders equipped with Wi-Fi
functions as a standard feature andaccommodating cloud connectivity.
Overall domestic sales for the current term decreased by ¥567 million(18.9%) year-on-year as the sales ofboth standard time recorders andtime recorders equipped with aggregation software compatible with
PCs declined.
Overall overseas sales decreasedby ¥141 million (down 21.6% yearon-year) as sales in North America,
Europe, and Asia fell.

Parking Systems¥53,854 million (down 17.7% year-on-year)

To respond to the increasingly diverse needs of parking lot management in Japan, the Parking Systems
has been working on improving theefficiency and reducing the cost of
parking lot management, increasing
the level of convenience for parking lot users, ensuring safety andsecurity in parking lots, making reservations and payments through the
integration with the Internet, and establishing non-contact ticketless and/or cashless systems.
In response to these market conditions, the Company further strengthened our cooperation with major
parking lot management firms and,at the same time, concentrated onoffering various services to small to
medium-sized parking lot management firms through our parking lot
data centers. The Company has also
worked to improve the functionality
and usability of our system equipment by expanding the proposals
for our vehicle number-based ticketless system; made efforts to expand
into new markets, such as bicycle
parking systems, security-gate systems and toll road systems; strength-

ened proposals for improving parking lot management efficiency; andmade new proposals for enhancing
parking lot services to users.
Domestic sales for the current term
were as follows. For Amano, on an
unconsolidated basis, domestic parking equipment sales decreased by¥5,811 million (29.6%) mainly due
to the effect of the increase in projects for management firms, whilesales generated by maintenancecontracts and supplies ser vices
also decreased by ¥1,193 million(12.2%). Sales decreased in thecommissioned parking lot management business operated by Amano
Management Service with a decline
in parking lot occupancy rates because people were told to refrainfrom going out following the declaration of the state of emergency inApril 2020. However, the Company
continue to invest in this business inanticipation of future business expansion and achieved an increase in
the number of parking spaces undermanagement by 24,000 (4.9%) fromthe end of the previous fiscal year.
Overall overseas sales decreased by¥3,701 million (down 15.2% yearon-year) due to a decrease in thesales of Amano McGann, Inc. inNorth America as well as mixed results in Asia, including an increase insales in Hong Kong and a decreasein the sales of the commissioned
parking lot management businessin South Korea and Malaysia mainly
due to the effect of restrictions on
going out.

Environment System business• Environmental Systems:
Standard dust collectors, large dust
collection systems, pneumatic powderconveyance systems, high-temperature hazardous-gas removal systems,
deodorization systems, and highperformance air purifier• Clean Systems:
Cleaning equipment, dry-carecleaning systems, cleaning man-agement services, and electrolytic
water generators
The sales in this business totaled¥29,007 million, down by ¥4,060
million (down 12.3%) year-on-year.
The following is a breakdown ofsales by business division.

Environmental Systems¥18,664 million (down 16.8% year-on-year)

This business had faced weak demand for capital investment due tothe outbreak of COVID-19, but ourbusiness environment has started toshow some signs of improvement
suppor ted by the recovery in the
Chinese economy.
In this mar ket environment, theCompany's domestic strategy focused on capitalizing the demandfor our standard equipment bystrengthening proposals, mainly
targeting companies related to machine tools and electronic parts, aswell as automobile manufacturers,
which continue to invest in the development of next-generation automobiles, while seeking to win additional orders from customers in thepharmaceutical, foods, and cosmetics
markets where demand is relatively
stable. Meanwhile, the Company enhanced cooperation with our overseas Group companies, reinforced
our platforms for engineering, sales
and ser vices. Fur ther more , theCompany endeavored to achieve
greater cost competitiveness by expanding its local procurement, whileobserving the investment trend ofJapanese companies operating overseas.
During the current term for Amano,
on an unconsolidated basis, domestic sales of standard equipment
decreased by ¥1,410 million (18.3%),
even though demand for high-performance air purifiers was strong,while sales of large-scale systems
decreased by ¥388 million (6.5%)
and sales generated by maintenancecontracts and supplies services decreased by ¥438 million (10.5%)
8

year-on-year.
Overall overseas sales decreased by¥1,608 million (down 36.7% yearon-year), as sales in Asia fell, particularly in China and Thailand

Clean Systems¥10,343 million (down 2.7% year-on-year)

In the Clean Systems, while thetrend of companies trying to reducecleaning costs continues domestically amid a shor tage of sanitar yworkers in the building maintenanceindustr y as well as rising hygiene
consciousness under the COVID-19
pandemic, the need for proposals
that lead to higher cleaning efficiency, improved quality, and the effective use of cleaning robots has been
increasing more than ever.
In response to these market conditions, we proposed the automationof cleaning work using the cleaning
robot “EGrobo” and promoted the
new automatic floor scrubber “EGseries,” which feature improved safety and usability. In addition, our efforts included proposals to improve
hygiene management through theuse of electrolytic water generators(*).
For this fiscal year, overall domestic sales of cleaning equipment
decreased by ¥159 million (7.4%)
and domestic sales generated bymaintenance contracts and supplies
ser vices decreased by ¥178 million (7.3%) year-on-year despite anincrease in demand for electrolytic
water generators while the sales ofother equipment were weak.
Overall overseas sales increased by¥85 million (up 1.6% year-on-year)
as Amano Pioneer Eclipse Corporation in North America, which
launched a sanitizer for preventing
COVID-19 infection, achieved anincrease in sales by capturing thedemand for cleaning(*)When water with a small amountof salt is electrolyzed it generates (i) [hypochlorous acid water

(acidic electrolyzed water)] and(ii) [alkaline electrolyzed water].
(i) has an excellent bactericidal
effect, and (ii) is an effective detergent to remove lipids and proteins.
For more details on our electrolyzed water generators, pleaserefer to our website (Japanese
language).
(https://www.amano.co.jp/Clean/
products/denkai.html)

General Financial Condition
for This Fiscal Year(i) Assets, liabilities, and net assets
Total assets amounted to ¥150,559
million (down ¥3,717 million fromthe previous consolidated fiscal yearend).
• Current assets: a decrease of¥1,858 million due to a decreasein notes and accounts receivabletrade, etc.
• Fixed assets: a decrease of ¥1,858
million due to a decrease in longterm deposits and software, etc.
Total liabilities amounted to ¥38,974
million (down ¥5,824 million fromthe previous consolidated fiscal yearend).
• Current liabilities: a decrease of¥5,854 million due to a decreasein accrued income taxes and electronically recorded obligations, etc.
• Long-term liabilities: an increase of¥30 million due to an increase inlease obligations, etc.
Net assets amounted to ¥111,585
million (up ¥2,106 million from theprevious consolidated fiscal yearend).
• Shareholders' equity: an increaseof ¥1,325 million due to posting of
net income attributable to ownersof the parent company, etc.
• Accumulated other comprehensive income: an increase of ¥830

million due to increases in net unrealized gains(losses) on availablefor-sale securities, etc.

Summary of Cash Flows forThis Fiscal Year
Consolidated cash and cash equivalents increased by ¥411 million fromthe previous fiscal year-end to a
total of ¥52,546 million as of March
31, 2021. The status of each type ofcash flow at year-end and the underlying factors are as follows.
Net cash provided by operating
activities totaled ¥15,596 million (adecrease in income of ¥7,614 million year-on-year).
• Main income factors:
Posting of income before income
taxes amounting to ¥9,788 million
and posting of depreciation andamortization amounting to ¥8,398
million.
Posting of a decrease in tradenotes and accounts receivableamounting to ¥4,065 million.
• Main expenditure factors:
Posting of income taxes paid
amounting to ¥5,800 million andposting of a decrease in trade
payables amounting to ¥2,572
million.
Net cash used in investing activities
totaled −¥6,355 million (an increasein cash outflow of ¥649 million yearon-year).
• Main income factors:
Posting of proceeds from withdrawal of time deposits amounting to ¥4,649 million and postingof proceeds from redemption of
securities amounting to ¥2,500
million.
• Main expenditure factors:
Posting of increase in time
deposits amounting to ¥3,994
million and posting of payment forpurchase of tangible fixed assets
amounting to ¥2,395 million.
Posting of payment for acquisition
9of investment securities amounting to ¥2,038 million and postingof payment for acquisition of intangible fixed assets amounting to¥1,686 million.
Net cash used in financing activities
amounted to −¥8,634 million (anincrease in cash outflow of ¥893
million year-on-year).
• Main income factors:
Posting of proceeds from sale andleaseback amounting to ¥1,249
million.
• Main expenditure factors:
Posting of dividends paid amounting to ¥5,703 million and postingof repayments of lease obligations
amounting to ¥3,718 million.

Future Outlook
In the next fiscal year ending March
31, 2022, the global economy willremain uncertain due to the worldwide shor tage of semiconductors
and the impact of the US-China
trade war amid COVID-19 pandemic. In this situation, the global
economy is likely to recover slightly
because of Chinese economy recovery and domestic economic activity
resumption.
Amid this business environment,
Amano Corporation and our Group
companies have set "The 3rd Stage
Towards a 100-year Company-Establishing a solid business foundationthat leads to sustainable growth " asour management concept and work
to address key issues in the 8th Medium-term Business Plan describedin "Business Policies" on page 1 witha view to maximizing the corporate
value of Amano Corporation.
For the next fiscal year ending
March 31, 2022, we forecast net
sales at ¥120,000 million, operating
profit at ¥12,500 million, ordinary
profit at ¥13,500 million and net
income attributable to parent company shareholders at ¥9,000 million.
For details, please refer to [2] Nu-

merical targets indicated on page 4,
in "Business Policies." Furthermore,this forecast assumes the currency
exchange rates of ¥105 to the US
dollar and ¥125 to the euro.
Although we have reflected the effects of COVID-19 in our full-year
forecast above as much as possible,
we intend to disclose them appropriately according to the futurechanges in the situation.

Operating and Other Risk Factors
Matters relating to the qualitative
infor mation contained in thesesummary financial statements andrelating to the consolidated financial
statements that could be envisaged
as having a possible material impact
on investors are described below.
Every effort, including the establishment of various internal committees
such as Compliance Committee andRisk Management Committee, aremade to identify factors that may
now or in the future pose a risk to
the undertaking of business by the
Amano Group, and these risk factors
are then eliminated or otherwise
managed in the course of business.
The activities of each committee
are reported to the Representative
Director as appropriate and to theBoard of Directors as necessary. The
outline of each committee is available for inspection on the websiteof our company.
(https://www.amano.co.jp/English/
corp/governance.html)
Forward-looking statements are
current as of the date of releaseof these financial results (April 26,2021).
(i) Impact on earnings due to changes in the business environment
The Amano Group uses the unique
technologies and know-how wehave accumulated to provide customers with high-quality products,
ser vices and solutions, thereby
gaining large market shares in eachsphere of business in Japan, North
America, Europe, and Asia, and developing our business globally.
In the year ended March 31, 2021,
the Time Information System business accounted for 74.5% of total
sales, and the Environment Systembusiness accounted for 25.5%. Before the deduction of unallocatedexpenses, the Time Information System business contributed 70.5% tooperating profit, while the Environment System business contributed
29.5%. In terms of weighted averagesales over the last five years, theTime Information System businessaccounted for 73.8% of total sales
and 72.3% of operating profit.
One future risk factor is that if market expansion is forecasted for abusiness activity within the Time Information System business segment(which accounts for a large proportion of the Group's business), forsuch reasons as a significant change
in the demand str ucture or thecreation of a new market, entities
in other industries or other powerful competitors may be tempted toenter the market. In such an event,if a competitor were to enter with
innovative products or solutions
that surpass Amano's, the Amano
Group's market advantage would
decline, which may have a material
impact on our business performance.
As part of our efforts to prepare forthese risks, the Amano Group works
to develop competitive products
on an ongoing basis and strives tostrengthen support systems further,engaging in business activities tomaintain and improve our competitive advantage in each business bystrengthening the relationship withexisting customers and expandingtransactions with new customers.
(ii) Fluctuations in exchange rates
Our group engages in businessactivities on a global scale and has
production and sales bases overseas.
In view of this, our group's business10

results may be impacted by fluctuations in exchange rates when theproceeds for overseas transactions
are converted into yen.
As precautionary measures against
such a risk, our group strives to reduce it by considering entering into,
for example, forward exchange contracts as necessary.
(iii) Information security
In the course of providing systemsolutions and developing cloud business ser vices (e.g., ASP, SaaS, andhosting services), the Amano Grouphandles confidential information,such as personal information concerning, or provided by, customers.
The occurrence of an unforeseen
situation such as a cyberattack that
results in loss or leakage of confidential or personal information
as described above could have an
adver se material impact on ourgroup's business performance due
to factors such as loss of confidence.
As precautionary measures against
such a risk, our group has establishedan Information Security Management Committee to strengthen andensure thorough implementation of
security control measures based onthe "Information Security Management Rules." More specifically, we
have implemented measures to prevent the leakage of confidential information based on the encryptionof hard disks and external storage
media and are providing regular employee education using e-learning.
Our company received the PrivacyMark certification in February 2014
and makes every effort in the areaof information security, including thesupervision of subcontractors andthorough compliance with internal
regulations. European subsidiaries ofour company are also working to
reduce risk by, for example, implementing adequate measures regarding the EU General Data Protection
Regulation (GDPR) enacted in May
2018, taking into consideration theguidance of local experts.

(iv) Natural disasters and infectious
diseasestrol headquarter in the event of an (vi) Accounting estimate assumption
emergency.
changeNatural disasters, such as large-scale
earthquakes and windstorms, floods,
etc., caused by climate change on a
global scale, are occurring more andmore frequently, and in the eventof a natural disaster, our group may
sustain damage to human lives or
our property, such as the destruction of sales business sites andproduction bases. In the event ofan outbreak of an infectious disease
that makes it difficult for employees to continue to work, our group
may temporarily lose the ability tocontinue to perform our operating
activities.

(v) O verseas business development
Our group has been developing ourbusiness globally in Japan, Nor th
America, Europe, and Asia. Therefore, there is a possibility that a situation may arise in which business
operations are disrupted due tothe application of unique laws, ordinances, or regulations or social disorder due to political disturbances,war, or terrorism, or pandemic, etc.
in countries or regions where ourgroup conducts business, which may
adversely impact our group's business performance.
In order to be ready for these risks,
our group collects information on
the situation in the countries andregions in which they operates on
an ongoing basis before any emergency occurs. Our group also holds
quar terly meetings of the Global
Str ategy Conference Executive
Management Board, at which top
management directly ascertains thesituation and gives instructions to
reduce risk. In the event that various
risks are materialized, our group will
grasp the situation quickly by sharing and exchanging information withoverseas group companies.

As precautionary measures against
such risks, our group has put inplace measures to ascer tain andensure the safety of employees byintroducing an emergency contact
network and safety confirmation
systems. In addition, our group ismoving our file servers and otherequipment to external data centers
and is improving the environment
to facilitate working from home toensure business continuity. Other
necessary measures that we havetaken to reduce risk include the establishment of the protocol for theestablishment of the disaster con-

Our group makes estimates regarding impairment accounting for
fixed assets and deferred tax assets
recoverability at the time of preparing the consolidated financial statements. These estimates are basedon cer tain assumptions about the
future. If the assumptions differ significantly due to the occurrence of
unexpected events such as natural
disasters that may have a significant
impact on domestic and overseas
economic activities and an outbreakof an infectious disease, it may affectour business performance.
In order to be ready for these risks,
our group strives to calculate a reasonable amount based on available
information at the time of accounting estimation.

Reference: Trend of cash flow indicators
As of Mar. 31, 2017

As of Mar. 31, 2018

As of Mar. 31, 2019

As of Mar. 31, 2020

As of Mar. 31, 2021

Equity ratio (%)

71.8

72.3

71.8

70.5

73.6

Fair value equity ratio (%)

122.6

150.1

132.5

116.1

134.0

Ratio of cash flow to interest-bearing liabilities (%)

16.0

11.2

14.0

27.1

43.5

Interest coverage ratio

447.8

483.5

539.4

227.9

101.9

Notes :	Equity ratio: Equity capital/Total assets
		Fair value equity ratio: Gross market capitalization/Total assets
		Ratio of cash flow to interest-bearing liabilities: Interest-bearing liabilities/Cash flow from operating activities
		Interest coverage ratio: Cash flow from operating activities/Interest payments
Assumptions
		* All indicators are calculated on the basis of consolidated financial values.
		* Gross market capitalization is calculated by multiplying the closing price of the Company's shares at the year-end by the number of shares of common stock issued and outstanding at the year-end (less treasury stock).
		* The term "cash flow from operating activities" refers to cash flow from operating activities posted under the consolidated statements of cash flows. The term "interest-bearing liabilities" refers to those liabilities stated in the consolidated balance sheets on
which interest is paid. Interest payments equate with the interest paid recorded in the consolidated statements of cash flows.

11

AMANO Corporation and Subsidiaries

Financial Highlights
For the year ended March 31, 2021
Yen in millions and U.S. dollars in thousands, except per share amounts- See Note 4 to the Consolidated Financial Statements.
Thousands of U.S.dollars(Note 4)

Millions of Yen

2021

2020

2021

Net sales...................................................................

¥113,598¥133,084$1,023,410

Net income................................................................

7,248

10,56765,299Net income per share (Basic)......................................

¥97.08¥141.40$0.875

Cash dividends per common share..............................

65.00

84.00

0.586

Total assets...............................................................

¥150,559¥154,276$1,356,392

Working capital.........................................................

67,79063,794

610,727

Total net assets..........................................................

111,585

109,478

1,005,274

Time information systems..........................................

¥27,878¥31,110$251,161

Time management equipment ...................................

2,856

3,475

25,738Parking systems ........................................................

53,85465,429485,179

Environmental systems .............................................

18,664

22,432

168,144

Cleaning systems ......................................................

10,343

10,635

93,188For the years ended March 31:

Per share data (Yen and U.S. Dollars):

At March 31:

Sales by product:

Note: U.S. dollar amounts have been translated at the rate of ¥111 = US $1, the rate prevailing on March 31, 2021.
- See Note 4 to the Consolidated Financial Statements.

Net Sales

Net Income

Net Income Per Share(Millions of Yen)

(Millions of Yen)

(Yen)

140,000

12,000160.00130,000
120,000

140.0010,000110,000

120.00100,000
8,000

90,000100.0080,00070,000

6,000

80.00

60,00050,000

60.00

4,000

40,00040.00

30,0002,000

20,00020.00

10,000
0

'17

'18

'19

'20

'21

0

'17

'18

'19

12

'20

'21

0.00

'17

'18

'19

'20

'21

AMANO Corporation and Subsidiaries

Consolidated Balance Sheet
As at March 31, 2021
Thousands of U.S.dollars(Note 4)

Millions of Yen

ASSETS

2021

2020

2021

Cash and bank deposits (Notes 6, 16 and 18)..............

¥56,432¥54,973$508,403

Marketable securities (Notes 16 and 18)......................

2,556

1,743

23,034

27,17531,392244,822

Current assets:

Notes and accounts receivable:
Trade (Notes 18)...................................................
Less allowance for doubtful accounts .....................

(399)

(321)

(3,599)26,77531,071

241,224

3,883

4,282

34,986Inventories:
Merchandise and finished goods ............................
Work in process ...................................................

540

622

4,872

Raw materials and supplies ...................................

4,429

4,796

39,902Other current assets ..................................................

3,981

2,968

35,871

Total current assets ...............................................

98,600100,458

888,291

Buildings and structures ............................................

29,02928,977

261,528

Machinery and equipment .........................................

22,953

22,235

206,788

Leased assets (Note 17)..............................................

12,63910,800113,872

64,62262,013582,187(45,164)(42,313)(406,891)

19,457

19,700175,297

Land ........................................................................

5,896

5,922

53,124

Construction in progress ............................................

237

446

2,144

Total property, plant and equipment ......................

25,592

26,069230,564

Goodwill ..................................................................

1,612

1,918

14,524

Software ...................................................................

3,760

4,752

33,877

Software in progress ..................................................

922

1,118

8,315

Property, plant and equipment, at cost:Less accumulated depreciation ..........................

Intangible fixed assets :Other intangible fixed assets ......................................

1,811

3,150

16,321

Total intangible fixed assets ..................................

8,107

10,93973,037(Notes 5 and 18) .......................................................

2,237

2,078

20,161

Investments in securities (Note 18).............................

10,066

6,803

90,692

Leasehold and guarantee deposits ..............................

1,724

1,550

15,538Deferred tax assets (Note 20)......................................

2,403

3,086

21,652Other assets .............................................................

2,415

3,952

21,763

Investments and other assets:
Investments in unconsolidated subsidiaries and affiliates

Less allowance for doubtful accounts .........................

(589)

(662)

(5,307)

Total investments and other assets ........................

18,25916,809164,499

Total assets............................................................................

¥150,559¥154,276$1,356,392

13Thousands of U.S.dollars(Note 4)

Millions of Yen

LIABILITIES AND NET ASSETS

2021

2020

2021

Current liabilities:
Trade notes and accounts payable (Note 18)...............
Electronically recorded monetary claims (Note 18)......
Short-term bank loans ..............................................
Lease obligations (Notes 17 and 18) ...........................
Accrued bonuses for employees .................................
Accrued bonuses for directors ....................................
Accrued income taxes ...............................................
Other current liabilities ..............................................
Total current liabilities ..........................................

¥5,371
5,073
520
2,843
2,379
90
1,445
13,08630,809¥6,210
6,845
678
2,641
2,842
130
3,711
13,60436,664$48,389
45,7094,690
25,616
21,435811
13,019117,894
277,564

Long-term liabilities:
Liability for retirement benefits (Note 19)....................
Long-term accounts payable ..........................................
Lease obligations (Notes 17 and 18) ...........................
Deferred tax liabilities (Note 20).................................
Asset retirement obligations ......................................
Other long-term liabilities...........................................
Total long-term liabilities ......................................
Total liabilities ......................................................

2,308
–
4,856
128
33
837
8,164
38,974

2,736
0
4,495
136
32
732
8,134
44,79820,800–43,753
1,154
300
7,547
73,554351,118

18,23919,29381,74918,23919,29380,204

164,321
173,812736,479(4,443)
114,838(4,224)
113,512(40,034)
1,034,577

1,875(5,242)(620)(3,986)

1,025(4,781)(1,061)(4,817)

16,901(47,225)(5,589)(35,914)

Non-controlling interests in consolidated subsidiaries .....

733

783

6,611

Total net assets......................................................
Total liabilities and net assets ...............................................

111,585¥150,559

109,478¥154,276

1,005,274$1,356,392

Net assets (Notes 14 and 15):
Shareholders' equity:
Common stock
Authorized - 185,476,000 shares
Issued:March 31, 2021 and 2020 - 76,657,829 sharesin 2021 and 2020 ..............................................
Capital surplus .....................................................
Retained earnings .................................................
Treasury stock at cost, 2,033,401 shares in 2021
and 1,925,901 shares in 2020 ..............................

Accumulated other comprehensive income:Net unrealized gains (losses) on other securities .....
Foreign currency translation adjustments ...............
Retirement benefits liability adjustments ................

The accompanying notes are an integral part of these statements.

14

AMANO Corporation and Subsidiaries

Consolidated Statement of Income, andConsolidated Statement of Comprehensive Income
For the year ended March 31, 2021

Consolidated Statement of Income
Thousands of U.S.dollars(Note 4)

Millions of Yen

Net sales
Cost of sales (Note 8) ...........................................................
Gross profit ..........................................................
Selling, general and administrative expenses (Notes 7 and 8).....
Operating income .................................................
Other income ( expenses ):Interest and dividend income .....................................
Interest expense ........................................................
Equity in earnings of affiliates ....................................
Foreign exchange gain (loss) .....................................
Gain on sale of fixed assets (Note 9) ..........................
Loss on disposal of fixed assets (Note 10) ..................
Loss on sale of fixed assets (Note 11) .........................
Impairment loss on fixed assets (Note 12)...................
Other, net .................................................................
Income before income taxes and non-controlling interests ......
Income taxes (Note 20):
Current .....................................................................
Deferred ...................................................................
Income before non-controlling interests .................
Non-controlling interests in net income of consolidated subsidiaries .....
Net income............................................................

2021

2020

2021

¥113,598
63,761
49,83739,902
9,934¥133,084
73,362
59,721
43,552
16,168$1,023,410
574,427448,982359,482
89,501

415
(153)
250
(13)
21
(45)
–
(1,121)
499
9,788

385
(102)
198
(93)
5
(39)
(194)
(198)
151
16,282

3,747(1,383)
2,255
(119)
198
(408)
–
(10,102)
4,500
88,188

2,366
117
7,305
(56)
¥7,2485,790(241)
10,732(165)¥10,567

21,3181,058
65,812(513)$65,299

Consolidated Statement of Comprehensive Income
Thousands of U.S.dollars(Note 4)

Millions of Yen

Income before non-controlling interests ................................

2021

2020

2021

¥7,305¥10,732$65,812

Other comprehensive income (loss) (Note 13):
Net unrealized gains (losses) on other securities .........
Translation adjustments ............................................
Retirement benefits liability adjustments ....................
Share of other comprehensive income (loss) of companies
accounted for by the equity method.................................
Total other comprehensive income (loss) .................
Comprehensive income ........................................................

851
(504)
440

(894)
(548)
(112)

7,672
(4,542)
3,972

0
788
¥8,0930(1,554)¥9,1771
7,103$72,915

Total comprehensive income attributable to:Shareholders of the Company ....................................
Non-controlling interests ...........................................

¥8,078¥14¥8,966¥210$72,783$132

The accompanying notes are an integral part of these statements.

15

AMANO Corporation and Subsidiaries

Consolidated Statement of Changes in Net Assets
For the year ended March 31, 2021
Millions of Yen
Shareholders’ equity
Total shareholders’equity(¥4,224)¥113,5120(4,224)
113,512

Common stock

Capital surplus

Retained earnings

Balance at April 1, 2020
Cumulative effect of change in accounting principle
Restated balance at April 1, 2020
Changes during the year
Dividends from surplus
Net income
Purchase of treasury stock
Retirement of treasury stock
Net changes in items other than shareholders' equity
Total changes during the year

¥18,239¥19,293

18,23919,293¥80,204
080,204

–

–

1,544

(219)

1,325

Balance at March 31, 2021

¥18,239¥19,293¥81,749(¥4,443)¥114,838

Balance at April 1, 2020
Cumulative effect of change in accounting principle
Restated balance at April 1, 2020
Changes during the year
Dividends from surplus
Net income
Purchase of treasury stock
Retirement of treasury stock
Net changes in items other than shareholders' equity
Total changes during the year
Balance at March 31, 2021

Treasury stock(5,703)
7,248
(246)
26

(5,703)
7,248
(246)
26

Accumulated other comprehensive income
Non-controllinginterests in
Net unrealized Foreign currency
Retirement
Total accumulated
gains (losses) on
translation
benefits liability other comprehensive consolidated
subsidiaries
other securities
adjustments
adjustments
income (loss)¥1,025(¥4,781)(¥1,061)(¥4,817)
¥783
1,025

(4,781)(1,061)(4,817)783¥109,4780109,478

850
850

(460)
(460)

440
440

830
830

(49)
(49)

(5,703)
7,248
(246)
26
781
2,106

¥1,875(¥5,242)(¥620)(¥3,986)¥733¥111,585

Common stockThousands of U.S. dollars (Note 4)
Shareholders’ equity
Capital surplus Retained earnings Treasury stock Total shareholders’equity$173,812$722,563($38,058)$1,022,637
00
173,812722,563(38,058)
1,022,637

Balance at April 1, 2020
Cumulative effect of change in accounting principle
Restated balance at April 1, 2020
Changes during the year
Dividends from surplus
Net income
Purchase of treasury stock
Retirement of treasury stock
Net changes in items other than shareholders' equity
Total changes during the year

$164,321––

13,916(1,976)

11,940

Balance at March 31, 2021

$164,321$173,812$736,479($40,034)$1,034,577

Balance at April 1, 2020
Cumulative effect of change in accounting principle
Restated balance at April 1, 2020
Changes during the year
Dividends from surplus
Net income
Purchase of treasury stock
Retirement of treasury stock
Net changes in items other than shareholders' equity
Total changes during the year
Balance at March 31, 2021

Total net assets

164,321(51,383)(51,383)

65,299(2,216)240

65,299(2,216)
240

Accumulated other comprehensive income
Non-controllinginterests in
Net unrealized Foreign currency
Retirement
Total accumulated
gains (losses) on
translation
benefits liability other comprehensive consolidated
subsidiaries
other securities
adjustments
adjustments
income (loss)$9,236($43,073)($9,560)($43,398)$7,0559,236(43,073)(9,560)(43,398)

7,055

Total net assets$986,295
0986,294(51,383)

7,665
7,665

(4,152)(4,152)

3,972
3,972

7,484
7,484

(444)
(444)

65,299(2,216)240
7,040
18,980$16,901($47,225)($5,589)($35,914)$6,611$1,005,274

16

Millions of Yen
Shareholders’ equity(4,220)Total shareholders’equity¥109,178
0109,178(3)(6,228)
10,567
(3)

4,338

(3)

4,334

¥80,204(¥4,224)¥113,512

Common stock

Capital surplus

Retained earnings

Treasury stock

Balance at April 1, 2019
Cumulative effect of change in accounting principle
Restated balance at April 1, 2019
Changes during the year
Dividends from surplus
Net income
Purchase of treasury stock
Net changes in items other than shareholders' equity
Total changes during the year

¥18,239¥19,293(¥4,220)

18,23919,293¥75,866
075,866––

Balance at March 31, 2020

¥18,239¥19,293

Balance at April 1, 2019
Cumulative effect of change in accounting principle
Restated balance at April 1, 2019
Changes during the year
Dividends from surplus
Net income
Purchase of treasury stock
Net changes in items other than shareholders' equity
Total changes during the year
Balance at March 31, 2020

(6,228)
10,567

Accumulated other comprehensive income
Non-controllinginterests in
Net unrealized Foreign currency
Retirement
Total accumulated
consolidated
gains (losses) on
translation
benefits liability other comprehensubsidiaries
other securities
adjustments
adjustments
sive income (loss)¥1,921(¥4,189)(¥948)(¥3,216)
¥630
1,921

(4,189)(948)(3,216)Total
net assets

630¥106,592
0
106,592

(896)
(896)

(591)
(591)

(112)
(112)

(1,600)(1,600)152
152(6,228)
10,567(3)(1,447)2,886¥1,025(¥4,781)(¥1,061)(¥4,817)¥783¥109,478

The accompanying notes are an integral part of these statements.

17

AMANO Corporation and Subsidiaries

Consolidated Statement of Cash Flows
For the year ended March 31, 2021
Millions of Yen

Cash Flows from Operating Activities:
Income before income taxes and non-controlling interests..........
Depreciation and amortization.............................................
Amortization of goodwill......................................................
Impairment loss on fixed assets..............................................
Increase (decrease) in liability for retirement benefits...........
Increase (decrease) in allowance for doubtful accounts.........
Interest and dividend income...............................................
Equity in earnings of affiliates .............................................
Interest expenses.................................................................
Foreign currency translation (gain) loss................................
(Gain) loss on sale of fixed assets.........................................
Loss on disposal of fixed assets............................................
(Increase) decrease in trade notes and accounts receivable....
(Increase) decrease in inventories.........................................
Increase (decrease) in trade notes and accounts payable.......
Others.................................................................................
Subtotal...............................................................................
Interest and dividends received............................................
Interest paid........................................................................
Payment for extra retirement payments................................
Income taxes paid................................................................
Income taxes refunded.........................................................
Net cash provided by operating activities..................
Cash Flows from Investing Activities:
Payment for purchase of marketable securities .....................
Proceeds from redemption of marketable securities ..............
Payment for purchase of property, plant and equipment .......
Proceeds from sale of property, plant and equipment ...........
Payment for acquisition of intangible assets .........................
Payment for acquisition of investments in securities .............
Proceeds from sale of investments in securities ....................
Increase in time deposits .....................................................
Decrease in time deposits ....................................................
Payment for business acquisition .........................................
Others ................................................................................
Net cash used in investing activities ......................
Cash Flows from Financing Activities:
Proceeds from short-term bank loans ...................................
Repayment of short-term bank loans ...................................
Payment for acquisition of treasury stock .............................
Repayments of finance lease obligations ..............................
Proceeds from sale and leaseback ........................................
Dividends paid ...................................................................
Dividends paid to minority interests.....................................
Net cash 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 at beginning of year ..................................
Cash and cash equivalents at end of year (Note 16).............................
The accompanying notes are an integral part of these statements.

18

Thousands of U.S.dollars(Note 4)

2021

2020

2021

¥9,788
8,398
358
1,121
207
7
(415)
(250)
153
(46)
(21)
45
4,065
646
(2,572)(1,265)
20,219
475
(153)
(11)
(5,800)865
15,596¥16,282
7,310
547
198
114
13
(385)
(198)
102
39
189
39
3,727
387
(1,148)532
27,751
456
(101)
(29)
(5,114)249
23,211$88,188
75,6593,229
10,102
1,865
67(3,747)(2,255)
1,383
(416)
(198)
408
36,625
5,824(23,174)(11,401)
182,160
4,283(1,379)(102)(52,253)
7,799
140,507(3,350)2,500(2,395)44(1,686)(2,038)3(3,994)
4,649
–
(86)
(6,355)(2,000)2,000(3,135)52(2,033)(56)–(4,090)
3,720
–
(163)
(5,706)(30,180)
22,523(21,579)401(15,197)(18,368)
32(35,988)
41,884–(783)(57,256)

489
(641)
(246)
(3,718)
1,249(5,703)(63)(8,634)(194)
411
52,134¥52,546

716
(491)
(3)
(2,891)
1,215(6,228)(58)(7,741)(115)
9,647
42,487¥52,134

4,411(5,780)(2,216)(33,504)
11,258(51,383)(576)(77,791)(1,756)
3,705
469,684$473,388

AMANO Corporation and Subsidiaries

Notes to the Consolidated Financial Statements
1. Basis of Consolidated
Financial Statements
The accompanying consolidated financial statements of AMANO Corporation[hereafter, "the Company"] and its subsidiaries have been prepared in accordance with the provisions set forth in
the Japanese Financial Instruments andExchange Act and its related accounting
regulations in Japan. The accounts of
the Company and domestic subsidiaries included in the consolidation are
based on the accounting records maintained in accordance with accounting
principles generally accepted in Japan,
which are different in certain respects
as to the application and the disclosure
requirements of International Financial
Reporting Standards. As permitted by
the Financial Instruments and ExchangeAct, amounts of less than one million
yen have been rounded off. As a result,
the totals shown in the accompanying
consolidated financial statements (bothin yen and U.S. dollars) do not necessarily agree with the sums of the individual amounts. Certain amounts in theprior year's financial statements havebeen reclassified to conform to the current year's presentation.

end, which falls on December 31, 2020and necessary adjustments are madeto their financial statements to reflect
any significant transactions from January 1 to March 31, 2021. All significant
intercompany balances and transactions
have been eliminated in consolidation.

(2) Accounting for Investments in
Unconsolidated Subsidiaries
and Affiliates
None of the 3 unconsolidated subsidiaries are accounted for by the equity
method, because the effect of their net
income or losses and retained earnings
on the accompanying consolidated financial statements is immaterial. The
affiliates accounted for by the equity
method are listed below: - Creo Co.,Ltd.

and structures acquired on or after April
1, 2016, which are computed on thestraight-line method. The ranges of theuseful lives of assets are:
Buildings and structures 5-50 years
Machinery and vehicles 7-17 years
Normal repairs and maintenance, including minor renewals and improvements, are charged to income as incurred.

(4) Intangible Assets

3. Summary of Significant
Accounting Policies

Intangible assets are amortized using
the straight-line method. Software costs
for internal use are amortized by thestraight-line method over their expected
useful lives (five years). Software developed for external sale is amortizedover the estimated sales period, 3 years.
Goodwill is amortized over the estimated useful life, or where the amountof goodwill is immaterial, is charged toincome in the year of acquisition.

(1) Cash and Cash Equivalents(5) Leased Assets

2. Principles of Consolidation

Cash and cash equivalents consist of
cash on hand, cash in banks which can
be withdrawn at any time and shortterm investments with a maturity of
three months or less when purchased
which can easily be converted to cash
and are subject to little risk of change invalue.

(1) Scope of Consolidation(2) Inventories

The Company had 28 consolidated subsidiaries at March 31, 2021. The accompanying consolidated financial statements include the accounts of the Company and those of its subsidiaries thatare controlled by the Company. Under
the control concept, major subsidiaries
in which the Company is able to exercise control over operations are to be
fully consolidated. The accounts of theoverseas consolidated subsidiaries areconsolidated using their financial statements as of their respective fiscal year

Inventories are stated at cost (writedown
due to reduced profitability). Cost is determined principally using the periodic
average method.

Leased assets in finance lease transactions not involving transfer of ownership are depreciated by the straight-line
method over the term of the lease, witha residual value of zero. For some of its
subsidiaries which prepare the financial
statements based on IFRS, in principle,
lessees recognize all leases on the balance sheet as assets and liabilities, anddepreciation of capitalized leased assets is computed based on straight-line
method.

(3) Property, Plant andEquipment
Property, plant and equipment are stated at cost, less accumulated depreciation. Depreciation is computed on the
declining balance method, based on theestimated useful lives, except for buildings acquired on or after April 1, 1998
and for facilities attached to buildings

19(6) Accounting for Financial
Instruments(a) Derivatives
All derivatives are stated at their fairvalues, with changes in fair value included in net profit or loss for the period in which they arise.
(b) Securities
Securities held by the Company and its
subsidiaries are classified into four cat-egories;
Trading securities, which are held for the
purpose of generating profits on shortterm differences in prices, are stated attheir fair values, with changes in fairvalues included in net profit or loss forthe period in which they arise. Additionally, securities held in trusts for trading
purposes are accounted for in the samemanner as trading securities. Held-to-maturity debt securities, that the Company
and its subsidiaries have intent to holdto maturity, are stated at their costs after
accounting for any premium or discounton acquisition, which are amortized overthe period to maturity.
Investments of the Company in equity
securities issued by unconsolidated
subsidiaries and affiliates are accounted
for by the equity method. Exceptionally,
investments in certain unconsolidated
subsidiaries and affiliates are stated atcost because the effect of application of
the equity method would be immaterial.
Other securities for which market quotations are available are stated at fairvalue. Net unrealized gains or losses onthese securities are reported as a separate item in the net assets section at a
net-of-tax amount. Other securities forwhich market quotations are unavailable are stated at cost, except as statedin the paragraph below.
In cases where the fair value of heldtomaturity debt securities, equity securities issued by unconsolidated subsidiaries and affiliates, or other securities
had declined significantly and such
impairment of the value is not deemed
temporary, those securities are written
down to the fair value and the resulting
losses are included in net profit or loss
for the period.

tion dates. Receivables and payables inforeign currencies are translated at theforeign exchange rates prevailing at therespective balance sheet dates and theresulting transaction gains or losses areincluded in net profit or loss for the period.

(7) Foreign Currency Translation(10) Allowance for Doubtful
Accounts

Foreign currency transactions aretranslated using foreign exchange rates
prevailing at the respective transac-(8) Translation of Foreign
Currency Financial
Statements (Accounts ofOverseas Subsidiaries)
Foreign currency denominated statements of overseas consolidated subsidiaries have been translated into Japanese yen using the method prescribedby the Business Accounting Deliberation
Council of Japan.
All the balance sheet accounts of foreignsubsidiaries and affiliates are translated
at the foreign exchange rates prevailingat the respective balance sheet dates except for common stock and capital surplus. On the other hand, all the profit
and loss accounts are translated at the
average foreign exchange rates for therespective periods. Differences arisingfrom translation are presented as "Foreign currency translation adjustments"and "Non-controlling interests in consolidated subsidiaries" in the accompanying consolidated financial statements.

(9) Income Taxes
The Company recognizes the tax effectof temporary differences between the
carrying amounts and the tax basis ofassets and liabilities. The provision forincome taxes is computed based on thepretax income statement of income. The
asset and liability approach is used torecognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences.

In general, the Company and its subsidiaries provide the allowance based on

20

the past receivables loss experience fora certain reference period. Furthermore,
for receivables from companies withfinancial difficulty, which could affectthe debtors' ability to perform their obligations, the allowance is provided for
estimated unrecoverable amounts individually.

(11) Retirement Benefits
The Company and some of its subsidiaries recognize accrued pension andseverance costs to employees based on
the actuarial valuation of projected benefit obligation and plan assets at theirvalue. The retirement benefit obligation for employees is attributed to eachperiod by the benefit formula method.
Prior service costs are amortized basedon the straight-line method over a period years(7-10years). Actuarial gains
and losses are amortized based on thestraight-line method over a period years(7-10years) starting from the beginningof the subsequent year.

(12) A ccrued Employees'
Bonuses
Accrued employees' bonuses at thebalance sheet date are based on an
estimate of the amounts to be paid asbonuses for services rendered by employees by that date.

(13) Accrued Directors' Bonuses
Accrued directors' bonuses at the balance sheet date are based on an estimate of the amounts to be paid as bonuses for services rendered by directors
by that date.

(14) Provision for stock benefit
In order to prepare for the payment ofcompany stocks to employees under
the stock benefit program, provision
for stock benefit is recorded based on
the estimated amount of stock benefit
obligation corresponding to the merit
points allocated to the employees in thecurrent consolidated fiscal year.

(15) Provision for directors’ stock
benefit
In order to prepare for the paymentof the Company stocks to officers anddirectors under the share payment program, provision for stock benefit is recorded based on the estimated amountof stock benefit obligation corresponding to the merit points allocated to theofficers and directors in the current consolidated fiscal year.

(16) Research and Development
Expenses

the percentage of completion for eachcontract can be reliably estimated. The
percentage of completion is measured
by the percentage of total costs incurred
to date to estimated total costs for eachcontract. The completed-contract method is applied to the contracts in casethe percentage of completion cannot be
reliably estimated.

(19) Accounting for Consumption
Taxes
Transactions subject to consumption
taxes are recorded at amounts exclusiveof consumption taxes.

Research and development expenses arecharged to income as incurred.

(20) Accounting standard issued
but not yet effective(17) Net Income and Dividends
per Share(Accounting Standard and Implementation Guidance on Revenue Recognition)
On March 31, 2020, the ASBJ issued“Accounting Standard for Revenue Recognition” (ASBJ Statement No.29) and “Implementation Guidance on Accounting Standard for Revenue Recognition ”(ASBJ Guidance No.30).
(1) Overview
This is a comprehensive accounting
standard addressing revenue recognition. Specifically, the accounting standard establishes the following five-stepmodel that will apply to revenue fromcontracts with customers:
Step 1: Identify the contract(s) with acustomer
Step 2: Identify the performance obligations in the contract
Step 3: Determine the transaction price
Step 4: Allocate the transaction price tothe performance obligations in the contract
Step 5: Recognize revenue when (or as)
the entity satisfies a performance obligation(2) Scheduled date of adoption The

Basic net income per share is computed based on the net income and theweighted average number of shares ofcommon stock outstanding during eachperiod. Diluted net income per shareis computed based on the net income
available for distribution to the shareholders and the weighted-average numbers of shares of common stock outstanding during each year after giving
effect to the dilutive potential of sharesof common stock to be issued upon theexercise of stock subscription rights andstock options. Cash dividends per share
shown for each fiscal period in the accompanying consolidated statement ofincome represent actual dividends declared as applicable to a common stockduring the respective fiscal period.

(18) Revenue from Construction
Contracts
Revenues and costs of construction
contracts are recognized by the percentage of completion method in case21

Company expects to adopt the accounting standard and implementation guidance from the beginning of the fiscal
year ending March 31, 2022.
(3) Impact of adoption of accounting
standard and implementation guidance
The Company is currently evaluating
the effect of the adoption of this accounting standard and implementation
guidance on its consolidated financial
statements.
(Accounting Standard for Fair Value
Measurement and Related Implementation Guidance) On July 4, 2019, the
Accounting Standards Board of Japan(ASBJ) issued “Accounting Standard for
Fair Value Measurement ” (ASBJ Statement No. 30), and “Implementation
Guidance on Accounting Standard for
Fair Value Measurement ” (ASBJ Guidance No. 31), along with related updates
to “Accounting Standard for Measurement of Inventories” (ASBJ Statement
No. 9), and “Accounting Standard for
Financial Instruments” (ASBJ Statement
No. 10).
(1) Overview
The ASBJ has developed an “Accounting Standard for Fair Value Measurement” and “Implementation Guidanceon Accounting Standard for Fair Value
Measurement” (hereinafter collectively,
the “Fair Value Measurement Standard”), which provide guidance for fairvalue measurement in order to improvecomparability with internationally recognized accounting standards. The Fair
Value Measurement Standard is appliedwith respect to the fair value of the following items;·Financial instruments defined in “Accounting Standard for Financial Instruments”·Inventories held for trading purposes
defined in “Accounting Standard forMeasurement of Inventories”
In addition, the ASBJ has revised "Implementation Guidance on Disclosuresabout Fair Value of Financial Instruments" (ASBJ Guidance No. 31), which
newly requires the disclosure for breakdown of financial instruments by thefair value hierarchy.
(2) Scheduled date of adoption The
Company expects to adopt the accounting standards and related implementation guidance from the beginning of the
fiscal year ending March 31, 2022.
(3) Impact of adoption of revised accounting standard and related implementation guidance The Company iscurrently evaluating the effect of the
adoption of the accounting standards
and related implementation guidanceon its consolidated financial statements.

(21) A dditional Information(Directors' Compensation BIP Trust and
Employee Stock Ownership Plan (JESOP))
For the purpose of enhancing the motivation to contribute the improvementof medium to long-term business performance and to increase the corporate
value, Amano Corporation and someof its subsidiaries have introduced theCompensation BIP Trust system for directors(excluding external directors and directors residing overseas) and operating
officers (excluding officers residing
overseas), as well as the Employee
Stock Ownership Plan (J-ESOP) systemfor employees who meet the prescribed
requirements.
(a) Outline of the system
Under the system, a trust is establishedwith funds contributed by Amano
Corporation. Stocks of Amano Corporation are acquired by the trust and to

be provided to eligible persons.Under
the Directors' Compensation BIP Trust,in accordance with the stock distribution rules and based on points granted
according to their positions and theattainment level of numerical targetsof performance indicators, stocks of
Amano Corporation are provided by thetrust to directors and operating officers.
Under the Employee Stock Ownership
Plan (J-ESOP), in accordance with thestock distribution rules and based on
points granted according to their positions and operating performance, stocksof Amano Corporation are provided by
the trust to employees who meet theprescribed requirements.
(b) Stocks of Amano Corporation thatremain in the trust
Stocks of Amano Corporation that remain in the trust are recorded as treasury stock in the net assets section withthe book value of the trust (excluding
incidental expenses). The book value
and the numbers of the treasury stock
at March 31, 2021 are ¥1,045 million
and 421,314 shares, respectively. (Thecorresponding measures and accounting estimate for the spread of COVID-19
infection) As an effort to ensure thehealth and safety of employees, theCompany and its domestic subsidiaries
have adopted flexible work such as telework (work from home) and staggered
working hours.
Overseas subsidiaries take measures inaccordance with instructions such as
curfew in the countries or states where
they are located, and when they arelocated in the area where the curfew isissued, they generally work from home.
As for our factory operations, domestic
factories are operating normally.
On the other hand, U.S. factories areoperated in accordance with the en-

22

forcements where they are located,
and at the present, we are continuing
normal production or production withthe minimum number of personnel. The
Company and its subsidiaries makes accounting estimates for impairment loss
on fixed assets and deferred tax assets
recoverability based on information
available at the time of preparation of
the consolidated financial statements.
Although the impact and severity of COVID-19 infection on the Company andits subsidiaries will differ dependingon the business, it is assumed that the
impact would be still large in fiscal year
ending march 2022, with the gradual
recovery after the first half of the last
fiscal year ending March 2021, in which
we had a significant impact.

4. United States Dollar Amounts
The Company maintains its accounting
records in Japanese yen. The U.S. dollar
amounts included in the consolidated
financial statements and notes there
to represent the arithmetical results oftranslating Japanese yen to U.S. dollars
at a rate of ¥ 111= US$1, the approximate effective rate of exchange prevailing on March 31, 2021. The inclusion of
U.S. dollar amounts is solely for convenience of readers outside Japan and is
not intended to imply that yen amounts
could be converted, realized, or settled
in U.S. dollars at that, or any other rate.

5. Investments in Unconsolidated Subsidiaries and Affiliates
Among investments in securities, the amount in aggregate corresponding to unconsolidated subsidiaries and affiliates at
March 31, 2021 and 2020 is as follows:
Millions of Yen

Investments in equity securities………………
Others………………………………………………

2021¥2,18453

Thousands of U.S.dollars ( Note 4 )2021$19,676477

2020¥2,02453

6. Assets Pledged as Collateral and Obligations Secured by Collateral
As at March 31, 2021 and 2020, the following assets were pledged as collateral:
Millions of Yen

Cash and bank deposits…………………………

2021
¥67

Thousands of U.S.dollars ( Note 4 )

2021
$604

2020
¥8

7. Selling, General and Administrative Expenses
Selling, general and administrative expenses during the years ended March 31, 2021 and 2020 principally include:
Millions of Yen

Employees' bonuses………………………………
Directors' bonuses…………………………………
Retirement benefits…………………………………
Salaries and allowances……………………………
Allowance for doubtful accounts…………………
Allowance for Provision for stock benefit…………
Allowance for Provision for directors’ stock benefit……

2021¥1,60190
1,142
18,249157
55
34

Thousands of U.S.dollars ( Note 4 )2021$14,423
811
10,288164,405
1,414
495
306

2020
¥2,055130
1,098
19,053253
8585

8. Research and Development Costs
Research and development costs included in selling, general and administrative expenses and manufacturing cost for the years
ended March 31, 2021 and 2020 are as follows:
Millions of Yen

Research and development costs…………………

2021¥1,793Thousands of U.S.dollars ( Note 4 )2021$16,1532020¥1,788

9. Gain on sale of fixed assets
Details of Gain on sale of fixed assets for the years ended March 31, 2021 and 2020 are as follows:
Millions of Yen

Buildings and structures……………………………
Machinery and equipment……………………………
Tools, Furniture and Fixtures………………………
Total…………………………………………………

2021
¥3
6
11
¥21

23

2020
¥0
4
0
¥5

Thousands of U.S.dollars ( Note 4 )

2021
$29
62
106
$198

10. Loss on disposal of fixed assets
Details of Loss on disposal of fixed assets for the years ended March 31, 2021 and 2020 are as follows:
Millions of Yen

Buildings and structures…………………………
Machinery and equipment………………………
Tools, Furniture and Fixtures………………………
Leased Assets……………………………………
Software……………………………………………
Total………………………………………………

2021
¥4
2
31
7
–
¥45

Thousands of U.S.dollars ( Note 4 )

2021
$37
22
280
67
–
$408

2020
¥13
1
13
10
0
¥39

11. Loss on sale of fixed assets
Details of Loss on sale of fixed assets for the years ended March 31, 2021 and 2020 are as follows:
Millions of Yen

Buildings and structures…………………………
Machinery and equipment………………………
Tools, Furniture and Fixtures………………………
Land………………………………………………
Total………………………………………………

2021
–
–
–
–
–

Thousands of U.S.dollars ( Note 4 )

2021

2020
¥12
0
0
182
¥194

–
–
–
–
–

12. Impairment Loss on Fixed Assets
Impairment loss on fixed assets for the year ended March 31, 2021 is as follows:
Location

Purpose of use

Amano McGann, Inc. (U.S.A.)

Business use

Amano Accu-Time Systems,
Inc. (U.S.A.)

Head officeCategory
Software
Other intangible fixed assets
Buildings and structures
Machinery and equipment
Land

2021

Thousands of
U.S. dollars ( Note 4 )2021¥1,060$9,550¥61$550Millions of Yen

Method to Group Assets:
The Company and its subsidiaries group assets according to minimum units that generate cash flows essentially independent
from the cash flows of other assets or groups of assets.
Recognition of Impairment Loss:As the forecasted profit was not expected due to poor performance, the book values of Amano McGann, Inc.'s groups of assets
were reduced to the recoverable amounts, and the reductions were recognized as impairment losses.
Due to decision of sale of fixed assets, the book values of Amano Accu-Time Systems, Inc.'s groups of assets were reduced to therecoverable amounts, and the reductions were recognized as impairment losses.
Calculation of Recoverable Amount:
As to Amano McGann, Inc., the recoverable amount for said assets were reasonably estimated based on the value in use, whichwere determined to be zero as no future cash flow is expected.
As to Amano Accu-Time Systems, Inc., the recoverable amount for said assets were reasonably estimated based on the net selling
price, which were measured by the estimated selling price.
Impairment loss on fixed assets for the year ended March 31, 2020 is as follows:
Location

Purpose of use

Category

Amano McGann, Inc. (U.S.A.)

Business use

Goodwill

Millions of Yen
2020
¥198

Thousands of
U.S. dollars ( Note 4 )2020$1,817

Method to Group Assets:
The Company and its subsidiaries group assets according to minimum units that generate cash flows essentially independent
from the cash flows of other assets or groups of assets.
Recognition of Impairment Loss:As the forecasted profit was not expected due to poor performance, the book values of above groups of assets were reduced to therecoverable amounts, and the reductions were recognized as impairment losses.
Calculation of Recoverable Amount:
The recoverable amount for said assets is reasonably estimated based on the value in use, which was determined to be zero as no
future cash flow is expected.
2413. Other Comprehensive Income
The following table presents reclassification adjustments and tax effects allocated to each component of other comprehensive
income (loss) for the years ended March 31, 2021 and 2020:

2021¥1,225
–
1,225
(374)
851

2020
(¥1,285)(5)(1,290)395(894)

Thousands of U.S.dollars( Note 4 )2021$11,036–
11,036(3,369)
7,672

(504)
–
(504)
–
(504)

(548)
–
(548)
–
(548)

(4,542)–(4,542)–(4,542)

349
288
638
(198)
440

(365)
207
(158)
45
(112)

3,144
2,595
5,748
(1,784)
3,972

0
–

0
–

0
–

0
¥788

0
(¥1,554)1$7,103

Millions of Yen
Net unrealized gains (losses) on other securities:……………………………………
Amount arising during the year………………………………………………
Reclassification adjustments……………………………………………………
Amount before tax effect………………………………………………………
Tax effect…………………………………………………………………………
Net unrealized gains (losses) on other securities……………………………
Translation adjustments:
Amount arising during the year ………………………………………………
Reclassification adjustments ……………………………………………………
Amount before tax effect ………………………………………………………
Tax effect …………………………………………………………………………
Translation adjustments ………………………………………………………
Retirement benefits liability adjustments:
Amount arising during the year ………………………………………………
Reclassification adjustments ……………………………………………………
Amount before tax effect ………………………………………………………
Tax effect …………………………………………………………………………
Retirement benefits liability adjustments ……………………………………
Share of other comprehensive income (loss) of companies accounted for by the equity method:Amount arising during the year ………………………………………………
Reclassification adjustments ……………………………………………………
Share of other comprehensive income of companies accounted
for by the equity method ………………………………………………………
Total other comprehensive income (loss) ……………………………………

25

14. Changes in Shareholders’ Equity
Changes in "Shares issued and outstanding" and "Shares of treasury stock" during the period from April 1, 2020 to March 31,
2021 are as follows:(1) Shares issued and outstanding
Share type
As of April 1, 2020
Increase
Decrease
As of March 31, 2021
Common stock (shares)
76,657,829––
76,657,829(2) Shares of treasury stock
Share type
As of April 1, 2020
Increase
Decrease
As of March 31, 2021
Common stock (shares)
1,925,901
118,186
10,6862,033,401(Reason for change)
The increase in the number of shares is due to the purchases of 486 shares less than one unit.
The increase in the number of shares is due to acquisitions of 117,700 shares by Directors' Compensation BIP Trust.
The decrease in the number of shares is due to delivery of 10,586 shares by Directors' Compensation BIP Trust.
The decrease in the number of shares is due to benefit of 100 shares by Employee Stock Ownership Plan (J-ESOP).
Changes in "Shares issued and outstanding" and "Shares of treasury stock" during the period from April 1, 2019 to March 31, 2020 are as follows:(1) Shares issued and outstanding
Share type
As of April 1, 2019
Increase
Decrease
As of March 31, 2020
Common stock (shares)
76,657,829––
76,657,829(2) Shares of treasury stock
Share type
As of April 1, 2019
Increase
Common stock (shares)
1,924,625
1,276(Reason for change)
The increase in the number of shares is due to the purchases of 1,276 shares less than one unit.

Decrease–

As of March 31, 2020
1,925,901

15. Dividends
Information on dividends for the fiscal year ended March 31, 2021 is as follows:(1) Dividends paid
Total dividend Total dividend Dividend per share Dividend per share Date of record Effective date(Millions of Yen) (Thousands of U.S.dollars)(Yen)(U.S.dollars)
Ordinary general meeting of shareholders, Common stock
March 31,
¥4,202$37,861¥56$0.505June 29, 2020
June 26, 2020
2020
Board of directors meeting,
September
30,
December 2,
Common stock¥1,500$13,522¥20$0.180
October 28, 2020
2020
2020
(NOTES)"Total dividend" as determined by the Ordinary general meeting of shareholders' resolution on June 26, 2020 includes ¥ 9 million for dividends on the Company's shares owned by Directors' Compensation BIP Trust and ¥ 8 million for dividends on our shares owned by Employee Stock Ownership Plan (J-ESOP).
"Total dividend" as determined by the Board of Directors' resolution on October 28, 2020 includes ¥ 5 million for dividends on the Company's shares owned
by Directors' Compensation BIP Trust and ¥ 2 million for dividends on our shares owned by Employee Stock Ownership Plan (J-ESOP).
(2) Dividends for which the date of record falls in the fiscal year, but the effective date is after the end of the fiscal year.
Date of
Dividend Total dividend Total dividend Dividend per share Dividend per share
Resolution
Share type
Effective datefunding(Yen)(U.S.dollars)(Millions of Yen) (Thousands of U.S.dollars)recordOrdinary general meeting of shareholders,CommonRetained30,¥3,377$30,423¥45$0.405
March 31, 2021 June
June 29, 2021
stock
earnings
2021(NOTES)"Total dividend" as determined by the Ordinary general meeting of shareholders' resolution on June 29, 2021 includes ¥ 12 million for dividends on the Company's shares owned by Directors' Compensation BIP Trust and ¥ 6 million for dividends on our shares owned by Employee Stock Ownership Plan (J-ESOP).
Resolution

Share type

Information on dividends for the fiscal year ended March 31, 2020 is as follows:(1) Dividends paid
Resolution

Share type

Total dividend(Millions of Yen)

Total dividend
Dividend per share Dividend per share Date of record(Thousands of U.S. dollars)(Yen)(U.S. dollars)
March 31,
¥37,868¥55$0.5052019
September 30,¥19,276¥28$0.2572019

Effective dateOrdinary general meeting of shareholders, Common stock
June 28,¥4,127
June 27, 20192019
December 3,
Board of directors meeting,Commonstock¥2,101
2019
October 28, 2019
(NOTES)"Total dividend" as determined by the Ordinary general meeting of shareholders' resolution on June 27, 2019 includes ¥ 9 million for dividends on the Company's shares owned by Directors' Compensation BIP Trust and ¥ 8 million for dividends on our shares owned by Employee Stock Ownership Plan (J-ESOP).
"Total dividend" as determined by the Board of Directors' resolution on October 28, 2019 includes ¥ 4 million for dividends on the Company's shares owned
by Directors' Compensation BIP Trust and ¥ 4 million for dividends on our shares owned by Employee Stock Ownership Plan (J-ESOP).
(2) Dividends for which the date of record falls in the fiscal year, but the effective date is after the end of the fiscal year.
Dividend
Total dividend
Total dividend
Dividend per share Dividend per share Date of record Effective date
Resolution
Share typefunding(Millions of Yen) (Thousands of U.S. dollars)(Yen)(U.S. dollars)
Ordinary general meeting of shareholders,CommonRetained
March 31,
June 29,¥4,202$38,550¥56$0.514
June 26, 2020
stock
earnings
2020
2020(NOTES)"Total dividend" as determined by the Ordinary general meeting of shareholders' resolution on June 26, 2020 includes ¥ 9 million for dividends on the Company's shares owned by Directors' Compensation BIP Trust and ¥ 8 million for dividends on our shares owned by Employee Stock Ownership Plan (J-ESOP).

26

16. Cash and Cash Equivalents
Reconciliations of cash and cash equivalents to the amounts shown in the consolidated balance sheet as at March 31, 2021 and2020 are as follows:
Millions of Yen
Cash and bank deposits…………………………………
Marketable securities…………………………………
Sub total……………………………………………
Time deposits due over three months…………………
Marketable securities due over three months…………
Cash and cash equivalents……………………………

2021¥56,432
2,556
58,989(4,593)(1,850)¥52,5462020¥54,973
1,743
56,717(3,582)(1,000)¥52,134

Thousands of U.S.dollars( Note 4 )2021$508,403
23,034
531,437(41,382)(16,667)$473,388(Supplemental disclosure of non-cash transactions)
The significant non-cash transactions for the years ended March 31, 2020 and 2019 are as follows:
Millions of Yen
Leased assets…………………………………………
Lease obligations………………………………………

2021¥4,1234,525

2020¥3,613
4,331

Thousands of U.S.dollars( Note 4 )2021$37,144
40,766

17. Lease Commitments(1) Lessees’ accounting
Minimum future lease payments under operating leases subsequent to March 31, 2021 and 2020 for non-cancelable operatingleases are summarized as follows:
Millions of Yen
Due within 1 year…………………
Due over 1 year……………………
Total…………………………………

2021
¥69
191
¥261

2020
¥69
261
¥331

Thousands of U.S.dollars ( Note 4 )
2021
$622
1,721
$2,351(2) Lessors’ accounting
Minimum future lease income under operating leases subsequent to March 31, 2021 and 2020 for non-cancelable operatingleases is summarized as follows:
Millions of Yen
Due within 1 year…………………
Due over 1 year……………………
Total…………………………………

2021
¥101
300
¥401

2020
¥101
401
¥502

27

Thousands of U.S.dollars ( Note 4 )
2021
$910
2,703
$3,613

18. Financial Instruments
Overview(1) Management policy
The management policy of the Company is to invest surplus funds into low-risk financial instruments. The Company has not held any high-risk financial instruments.

(2) Financial instruments and their risks
Both notes receivable and accounts receivable as operating receivables are exposed to credit-related losses in the event of nonperformance by counterparties. Trade notes, accounts payable and electronically recorded monetary claims as trade liabilities are due and payable within one year. Marketable securities and investments in securities are exposed to changes inmarket price. The Company holds marketable securities and investments in securities mainly as held-to-maturity or due to relationship-building with counterparties.

(3) Risk management policiesa) Management policy for credit risk (losses in the event of nonperformance by counterparties)
The Company has an established credit management policy, whereby credit risk exposure arising from both notes and accounts receivable is monitored on an ongoing basis in order todetect credit deterioration as well as to trigger appropriate minimizing measures at its early stages.
Held-to-maturity investments are subject to the examination and decision of the Funds Management Review Committee and accordingly, investments largely consist of negotiable
deposits and high graded securities, which are considered to have minimal credit risk.

b) Management policy for market risk (foreign currency exchange and interest rates)
Marketable securities and investment securities are marked to market and the financial condition of the issuer (client company) is monitored periodically.
In addition, the holdings of bonds and securities, other than held-to-maturity investments, are reviewed on an ongoing basis, taking into consideration the relationship, and other factors, with the issuer.

c) Management policy for liquidity risk (in default on its financial obligations)
The Company has managed liquidity risk by holding appropriate funds based on the forecasts, and actual cash flow is continuously monitored by the management.

(4) Supplementary explanation on the fair value of financial instruments
The fair values of financial instruments are based on quoted market prices. If quoted market prices are unavailable, the fair values are estimated based on the prices which are assessed asreasonable by the Company. Since the Company takes contingent variable factors into account when estimating the fair value, it would vary depending on the different preconditions.

Estimated fair value of financial instruments
Differences between carrying value and estimated fair value as of March 31, 2021 and 2020 are as follows:
Financial instruments whose fair values are difficult to estimate are not stated in the following table; refer to (* 2).

(1) Cash and bank deposits………………………
(2) Notes and accounts receivable………………
(3) Marketable securities and investments in securities① Held-to-maturity……………………………
② Subsidiaries and affiliates…………………
③ Other securities………………………………
Total (Assets)…………………………………
(4) Trade notes and accounts payable……………
(5) Electronically recorded monetary claims……
Total (Liabilities)……………………………

(1) Cash and bank deposits………………………
(2) Notes and accounts receivable………………
(3) Marketable securities and investments in securities① Held-to-maturity……………………………
② Subsidiaries and affiliates…………………
③ Other securities………………………………
Total (Assets)…………………………………
(4) Trade notes and accounts payable……………
(5) Electronically recorded monetary claims……
Total (Liabilities)……………………………

Carrying
value¥56,432
27,175
4,434
2,134
7,866
¥98,043¥5,371
5,073¥10,444

Carrying
value¥54,973
31,392
1,651
1,976
6,673
¥96,667¥6,2106,845¥13,056

Millions of Yen
2021
Estimated
Difference
fair value
in amounts¥56,432–
27,175
–
4,457
3,732
7,866
¥94,609¥5,371
5,073¥10,444

¥23
1,597
–
¥1,621–––Millions of Yen
2020
Estimated
Difference
fair value
in amounts¥54,973–
31,392
–
1,646
2,682
6,673
¥97,368¥6,2106,845¥13,056

28

(¥5)
705
–
¥700
–
–
–

Thousands of U.S.dollars ( Note 4 )2021
Carrying
Estimated
Difference
value
fair value
in amounts$508,403$508,403–
244,822244,822–39,946
19,22570,865$883,270$48,389
45,709$94,090

40,15333,62270,865$852,333$48,389
45,709$94,090$207
14,387–$14,604–––

(NOTES)(* 1): Methods to determine the estimated fair value of financial instruments and other matters related to securities and derivativetransactions.
Assets:(1) Cash and bank deposits, and (2) Notes and accounts receivable:
Since these items are settled in a short period of time, their carrying value approximates fair value.
(3) Marketable securities and investments in securities:
Since negotiable certificate of deposits are settled in a short period of time, their carrying values approximate fair value.
The fair value of the other stocks is based on quoted market prices. The fair value of debt securities is based on either quoted market prices or prices provided by the financial institutions making markets in these securities. For information on securities classified by holding purpose, please refer to (*5) Heldto-maturity and other securities with readily determinable fair value as at March 31, 2021 and 2020.
Liabilities:(4) Trade notes and accounts payable, and (5) Electronically recorded monetary claims:
Since these items are settled in a short period of time, their carrying value approximates fair value.

(*2): Financial instruments whose fair values are difficult to estimate are as follows:
Millions of Yen
Unlisted securities (Carrying value)

2021
¥372

2020
¥271

Thousands of U.S.dollars ( Note 4 )2021$3,351The unlisted securities as stated above are not included in (3) Marketable securities and investments in securities because it is difficult to estimate the fair value
based on the quoted market prices in active markets.

(*3) Redemption schedule for monetary claims and securities with maturities subsequent to the balance sheet date is as follows:

Cash and bank deposits………………………………
Notes and accounts receivable………………………
Marketable securities and investments in securities:
Held-to-maturity securities…………………………
		
Total…………………………

Cash and bank deposits………………………………
Notes and accounts receivable………………………
Marketable securities and investments in securities:
Held-to-maturity securities…………………………
		
Total…………………………

Cash and bank deposits………………………………
Notes and accounts receivable………………………
Marketable securities and investments in securities:
Held-to-maturity securities…………………………
		
Total…………………………

Due
within 1 year
¥56,432
27,175
1,850¥85,457

Millions of Yen
2021
Due after 1 year
Due after 5 years
but within 5 years
but within 10 years
–
–
–
–
409
¥409

Due
within 1 year
¥54,973
31,392
1,000¥87,366

Millions of Yen
2020
Due after 1 year
Due after 5 years
but within 5 years
but within 10 years
–
–
–
–
–
–

Due
within 1 year
$508,403
244,822
16,667$769,883

¥651
¥651

Thousands of U.S.dollars ( Note 4 )2021
Due after 1 year
Due after 5 years
but within 5 years
but within 10 years––––$3,685$3,68529¥2,174¥2,174$19,586$19,586

Due
after 10 years
–
–
–
–

Due
after 10 years
–
–
–
–

Due
after 10 years––––

(*4) Repayment schedule for bonds payable, long-term loans payable, lease obligations and other interest-bearing liabilities
subsequent to the balance sheet date:Long-term loans payable…………………
Lease obligations…………………………
		
Total…………………

Due within 1 year–
¥2,843¥2,843

The 2 years–¥2,459¥2,459Millions of Yen
2021
The 3 years
The 4 years
–
–
¥959
¥537
¥959
¥537

The 5 years
–
¥439
¥439

Thereafter
–
¥461
¥461

Millions of Yen
Long-term loans payable…………………
Lease obligations …………………………
		
Total…………………

Long-term loans payable…………………
Lease obligations…………………………
		
Total…………………

The 3 years–¥1,274¥1,2742020

Due within 1 year–
¥2,641¥2,641The 2 years–¥1,820¥1,820The 4 years
–
¥537
¥537

The 5 years
–
¥317
¥317

Thereafter
–
¥545
¥545

Due within 1 year–
$25,616$25,616

Thousands of U.S.dollars ( Note 4 )2021
The 2 years
The 3 years
The 4 years
The 5 years––––$22,154$8,643$4,839$3,958$22,154$8,643$4,839$3,958Thereafter–$4,159$4,159(*5) Held-to-maturity and other securities with readily determinable fair value as at March 31, 2021 and 2020 are as follows:
Millions of Yen
2021

Held-to-maturity securities with fair……
value exceeding carrying value
Held-to-maturity securities with fair……
value not exceeding carrying value
		Total……………………………

Other securities with carrying
value exceeding acquisition cost
Stocks………………………………
Other…………………………………
		Subtotal…………………………
Other securities with carrying
value not exceeding acquisition cost
Stocks………………………………
Other…………………………………
		Subtotal…………………………
		Total……………………………

Held-to-maturity securities with fairvalue exceeding carrying value…………
Held-to-maturity securities with fairvalue not exceeding carrying value……
		Total……………………………

Other securities with carrying
value exceeding acquisition cost
Stocks………………………………
Other…………………………………
		Subtotal…………………………
Other securities with carrying
value not exceeding acquisition cost
Stocks………………………………
Other…………………………………
		Subtotal…………………………
		Total……………………………

Thousands of U.S.dollars ( Note 4 )2021
Unrealized
Carrying value
Fair value
gains (losses)

Carrying value

Fair value

Unrealized
gains (losses)¥2,283¥2,307¥23$20,568$20,784

$207

2,150

2,150

(0)

19,36919,369(0)¥4,434¥4,457¥23$39,946$40,153$207

Carrying value

Acquisition
cost

Unrealized
gains (losses)

Carrying value

Acquisition
cost

Unrealized
gains (losses)¥6,306706
7,013¥3,503699
4,202¥2,8037
2,810$56,811
6,360
63,180$31,559
6,297
37,856$25,252
63
25,315853–
853¥7,866959–
959¥5,162

(106)
–
(106)
¥2,704

7,685
–
7,685
$70,865

8,640
–
8,640
$46,505

(955)
–
(955)
$24,360

Carrying
value

Millions of Yen
2020
Fair
value

Unrealized
gains (losses)

–

–

–

¥1,651¥1,646(¥5)¥1,651¥1,646(¥5)

Carrying
value

Acquisition
cost

Unrealized
gains (losses)¥4,200743
4,944¥2,229738
2,967¥1,971
5
1,976

1,729
–
1,729
¥6,673

2,227
–
2,227
¥5,195

(498)
–
(498)
¥1,47830

19. Retirement Benefits
Outline of the retirement benefit plans adopted(1) D efined benefit corporate pension scheme: From March 1, 2009, the Company adopted a defined benefit corporate pension
scheme as part of its retirement benefit plan.
(2) D efined contribution pension scheme: From March 1, 2009, the Company adopted a defined contribution pension schemeas part of its retirement benefit plan.
(3) E mployees' pension fund: Since April 1, 1980, the Company has used an multi-employer contributory funded pension plan
as a supplement to its existing retirement benefit scheme.
In addition, certain subsidiaries have lump-sum payment plans and a defined benefit corporate pension plan. They calculate theretirement benefit expenses, and assets and liabilities for retirement benefits by means of a simplified method.
The changes in the retirement benefit obligation for the years ended March 31, 2021 and 2020 are as follows:
Millions of Yen
2021¥13,739
999
68
(38)
(879)
–
(0)
¥13,890

Balance at the beginning of the year………………………………
Service cost………………………………………………………
Interest cost………………………………………………………
Actuarial loss………………………………………………………
Retirement benefits paid…………………………………………
Prior service cost…………………………………………………
Other………………………………………………………………
Balance at the end of the year……………………………………

2020¥13,458
990
52
(16)
(705)
–
(39)
¥13,739

Thousands of U.S.dollars( Note 4 )2021$123,775
9,000
613
(342)
(7,919)–(0)$125,135

The changes in plan assets for the years ended March 31, 2021 and 2020 are as follows:
Millions of Yen
2021¥11,201
278
309
774
(789)
7
¥11,783

Balance at the beginning of the year………………………………
Expected return on plan assets…………………………………
Actuarial loss………………………………………………………
Contributions by the Company…………………………………
Retirement benefits paid…………………………………………
Other………………………………………………………………
Balance at the end of the year……………………………………

31

2020
¥11,168
276
(382)
738
(583)
(16)
¥11,201

Thousands of U.S.dollars( Note 4 )2021$100,910
2,505
2,784
6,973
(7,108)63$106,153

The following table sets forth the funded status of the plans and the amounts recognized in the consolidated balance sheet as ofMarch 31, 2021 and 2020 for the Company's and the consolidated subsidiaries' defined benefits plans:

Unfunded retirement benefit obligation………………………
Net liability for retirement benefits in the balance sheet……

2021¥13,811(11,783)
2,028
78
2,107

2020
¥13,656(11,201)
2,454
83
2,537

Thousands of U.S.dollars( Note 4 )2021$124,423(106,153)
18,270703
18,982

Liability for retirement benefits………………………………
Asset for retirement benefits……………………………………
Net liability for retirement benefits in the balance sheet……

2,107–¥2,1072,537–¥2,537

18,982–$18,982

Millions of Yen
Funded retirement benefit obligation……………………………
Plan assets at fair value…………………………………………

The components of retirement benefit expense for the years ended March 31, 2021 and 2020 are as follows:
Millions of Yen
2021
¥999
68
(278)
290
–
¥1,080Service cost………………………………………………………
Interest cost………………………………………………………
Expected return on plan assets………………………………
Amortization of actuarial loss…………………………………
Amortization of prior service cost……………………………
Retirement benefit expense……………………………………

2020
¥990
52
(276)
207
–
¥973

Thousands of U.S.dollars( Note 4 )2021$9,000613(2,505)2,613–$9,730The components of retirement benefits liability adjustments included in other comprehensive income (before tax effect) for theyears ended March 31, 2021 and 2020 are as follows:
Thousands of U.S.dollars
Millions of Yen

2021
–
638
¥638

Prior service cost …………………………………………………
Actuarial loss (gain)……………………………………………
Total………………………………………………………………

2020
–
(158)
(¥158)( Note 4 )
2021
–
5,748
$5,748The components of retirement benefits liability adjustments included in accumulated other comprehensive income (before tax
effect) as of March 31, 2021 and 2020 are as follows:
Thousands of U.S.dollars
Millions of Yen

2021
–
(885)
(¥885)

Unrecognized prior service cost…………………………………
Unrecognized actuarial loss……………………………………
Total………………………………………………………………

2020–(1,524)(¥1,524)( Note 4 )2021–(7,973)($7,973)

The fair value of plan assets, by major category, as a percentage of total plan assets as of March 31, 2021 and 2020 is as follows:
Millions of Yen
2021
2020
13%
13%
53%
55%
15%
11%
19%
21%
100%
100%

General accounts…………………………………………………
Bonds………………………………………………………………
Stocks……………………………………………………………
Other………………………………………………………………
Total………………………………………………………………

The expected return on plan assets has been estimated based on the anticipated allocation to each asset class and the expectedlong-term returns on assets held in each category.
The assumptions used in accounting for the above plans were as follows:**They are calculated by the weighted average method.
2021
0.7%
2.5%
5.0%

Discount rate………………………………………………………
Expected long-term rate of return on plan assets……………
Expected rates of salary increases……………………………

32

2019
0.7%
2.5%
5.0%

For defined benefit plans to which the simplified method is applied, the changes in the retirement benefit obligation for the years
ended March 31, 2021 and 2020 are as follows:
Millions of Yen
2021
¥102
30
(29)
(24)
(0)
¥79

Balance at the beginning of the year………………………………
Retirement benefit expense……………………………………
Retirement benefits paid…………………………………………
Contributions to plans……………………………………………
Other………………………………………………………………
Balance at the end of the year……………………………………

2020
¥85
55
(15)
(23)
(0)
¥102

Thousands of U.S.dollars( Note 4 )
2021
$919
270
(261)
(216)
(0)
$712

The following table sets forth the funded status of the plans and the amounts recognized in the consolidated balance sheet as ofMarch 31, 2021 and 2020 for the Company's and the consolidated subsidiaries' defined benefits plans:

Unfunded retirement benefit obligation…………………………
Net liability for retirement benefits in the balance sheet……

2021
¥284
(356)
(71)
150
79

2020
¥265
(312)
(47)
149
102

Thousands of U.S.dollars( Note 4 )2021$2,559(3,207)
(640)
1,351
712

Liability for retirement benefits…………………………………
Asset for retirement benefits………………………………………
Net liability for retirement benefits in the balance sheet……

201
(122)
¥79

198
(96)
¥102

1,811
(1,099)$712

Millions of Yen
Funded retirement benefit obligation………………………………
Plan assets at fair value……………………………………………

Retirement benefit expenses calculated using the simplified method for the years ended March 31, 2021 and 2020 are as follows:
Millions of Yen
2021
¥30

Retirement benefit expenses………………………………………

2020
¥55

Thousands of U.S.dollars( Note 4 )
2021
$270

Contributions to defined contribution plans of the Company and its consolidated subsidiaries for the years ended March 31,
2021 and 2020 are as follows:
Millions of Yen
2021
¥582

Contributions to defined contribution plans………………………

33

2020
¥582

Thousands of U.S.dollars( Note 4 )2021$5,243

20. Income Taxes
Deferred tax assets and liabilities (both current and non-current) as at March 31, 2021 and 2020 consisted of the following elements:
Millions of Yen

Thousands of U.S.dollars(Note 4)

2021

2020

2021

Deferred tax assets:
Accrued enterprise tax …………………………………………………………………
Accrued employees' bonuses…………………………………………………………
Net liability for retirement benefits……………………………………………………
Loss carried forward (* 2)………………………………………………………………
Loss on write-down of investments in securities……………………………………
Surplus on allowance for doubtful accounts…………………………………………
Unrealized gains…………………………………………………………………………
Others……………………………………………………………………………………
Subtotal deferred tax assets………………………………………………………
Less: valuation allowance for tax loss carryforwards(* 2)…………………………
Less: valuation allowance for deductible temporary difference……………………
Subtotal valuation allowance(* 1)………………………………………………
Total deferred tax assets……………………………………………………………

¥115
772
673
1,103
240
155
523
1,860
¥5,444(981)(1,278)(2,259)¥3,185

¥198
873
808
1,525
326
172
535
1,387
¥5,826(1,392)(891)(2,284)¥3,542$1,036
6,955
6,063
9,937
2,162
1,396
4,712
16,757$49,045(8,838)(11,514)(20,351)$28,694

Deferred tax liabilities:
Unrealized loss on other securities……………………………………………………
Others……………………………………………………………………………………
Total deferred tax liabilities………………………………………………………
Net deferred tax assets……………………………………………………………

(760)
(149)
(909)
¥2,275

(438)
(155)
(593)
¥2,949(6,847)(1,342)(8,189)$20,495(NOTES)(* 1): V aluation allowance decreased by ¥ 24 million. While valuation allowance of a consolidated subsidiary in Europe increased by ¥ 18
million, valuation allowance of a consolidated subsidiary in North America decreased by ¥ 43 million.
(* 2): A breakdown of net operating loss carryforwards and valuation allowance by expiry date as of March 31, 2021 is as follows:

Millions of Yen
2021
Due in 1 Yearor Less
Net operating loss carryforwards (a)……
Valuation allowance……………
Deferred tax assets………………

–––Due after
1 Year through2 Years–––

Due after
2 Years through3 Years–––

Due after
3 Years through4 Years–––

Due after
4 Years through5 Years–––

Due after
5 Years

Total¥1,103(981)¥121¥1,103
(981)
¥121
(b)

Due after
5 Years

Total$9,937(8,838)$1,090$9,937(8,838)$1,090(b)

Thousands of U.S. dollars ( Note 4 )2021
Due in One Yearor Less
Net operating loss carryforwards (a)……
Valuation allowance……………
Deferred tax assets………………

–––Due after
1 Year through2 Years–––

Due after
2 Years through3 Years–––

Due after
3 Years through4 Years–––

Due after
4 Years through5 Years–––(a): The amount is determined by multiplying the corresponding net operating loss carryforwards by the effective statutory tax rate.
(b): Deferred tax assets of ¥ 121 million are related to tax loss carryforwards of ¥ 1,103 million. The tax loss carryforwards for which theCompany recognized deferred tax assets are determined to be recoverable by expected future taxable income.

34

Millions of Yen
2020
Due in 1 Yearor Less
Net operating loss carryforwards (a)……
Valuation allowance……………
Deferred tax assets………………

–––Due after
1 Year through2 Years–––

Due after
2 Years through3 Years–––

Due after
3 Years through4 Years–––

Due after
4 Years through5 Years–––

Due after
5 Years

Total¥1,525(1,392)¥132¥1,525(1,392)¥132(b)

Due after
5 Years

Total$13,991(12,771)$1,211$13,991(12,771)$1,211(b)

Thousands of U.S. dollars ( Note 4 )2020
Due in One Yearor Less
Net operating loss carryforwards (a)……
Valuation allowance……………
Deferred tax assets………………

–––Due after
1 Year through2 Years–––

Due after
2 Years through3 Years–––

Due after
3 Years through4 Years–––

Due after
4 Years through5 Years–––(a): The amount is determined by multiplying the corresponding net operating loss carryforwards by the effective statutory tax rate.
(b): Deferred tax assets of ¥ 132 million are related to tax loss carryforwards of ¥ 1,525 million. The tax loss carryforwards for which theCompany recognized deferred tax assets are determined to be recoverable by expected future taxable income.

Reconciliation of the effective statutory tax rate and the actual tax rate is shown below:
Effective statutory tax rate…………………………………………………………
Adjustments:
Entertainment and other nondeductible expenses…………………………
Dividends and other nontaxable income………………………………………
Inhabitant tax on per capita levy…………………………………………………
Nondeductible amortization of goodwill………………………………………
Eliminated dividend received from subsidiaries……………………………
Realization of tax benefits on operating losses………………………………
Tax credit for research and development expenses…………………………
Valuation allowance…………………………………………………………………
Deferred tax assets reduced by change of taxation rates…………………
Difference of foreign subsidiaries' taxation rates……………………………
Equity in earnings of affiliates……………………………………………………
Others……………………………………………………………………………………
Actual tax rate……………………………………………………………………

35

2021
30.6%

2020
30.6%

0.8
(4.5)
0.9
0.8
4.3
–
(4.7)
(0.3)
(1.4)
0.1
(0.8)
(0.4)
25.4%

0.6
(2.7)
0.6
0.7
3.2
(0.7)
–
(0.2)

2.6
(0.7)
(0.4)
0.5
34.1%

21. Segment Information
The reportable segments of the Company are components for which discrete financial information is available and whose operating results are regularly reviewed by the Executive Committee to make decisions about resource allocation and to assess performance.
The reportable segments are as follows:
1. Time information system business
2. Environment system business(1) Sales, profits or losses, assets and other items by reportable segments
Millions of Yen
2021
Reportable segments
Time information Environment
Total
system business system businessNet sales:
Sales to third parties………………………………
Intersegment sales and transfers…………………
		Total…………………………………
Segment profit or loss………………………………
Segment assets………………………………………
Depreciation and amortization……………………
Investment in equity-method affiliates……………
Increase in tangible and intangible fixed assets……

¥84,590–
84,5909,654
65,616
7,229
2,134
6,297

¥29,007–
29,007
4,033
25,657588–
498¥113,598–
113,598
13,687
91,273
7,817
2,134
6,796

Adjustments/
Eliminations

Consolidated–––(¥3,753)
59,285580–
201¥113,598–
113,598
9,934
150,559
8,398
2,134
6,997

Adjustments/
Eliminations

Consolidated–––(¥4,246)
58,484628–
953¥133,084–
133,084
16,168154,276
7,310
1,976
8,221

Millions of Yen
2020
Reportable segments
Time information
Environment
system business system businessNet sales:
Sales to third parties………………………………
Intersegment sales and transfers…………………
		Total…………………………………
Segment profit or loss………………………………
Segment assets………………………………………
Depreciation and amortization……………………
Investment in equity-method affiliates……………
Increase in tangible and intangible fixed assets……

¥100,016–
100,016
15,65870,853
6,103
1,976
6,851

¥33,068–
33,068
4,756
24,939
578
–
416

Total
¥133,084–
133,084
20,415
95,792
6,681
1,976
7,267

Thousands of U.S. dollars (Note 4)
2021
Reportable segments
Adjustments/
Time information Environment
Eliminations
Total
system business system businessNet sales:
Sales to third parties………………………………
Intersegment sales and transfers…………………
		Total…………………………………
Segment profit or loss………………………………
Segment assets………………………………………
Depreciation and amortization……………………
Investment in equity-method affiliates……………
Increase in tangible and intangible fixed assets……

$762,078–
762,078
86,975591,140
65,131
19,22856,738$261,332–
261,332
36,338231,144
5,301
–
4,491

36

$1,023,410–
1,023,410
123,313822,284
70,432
19,22861,229–––($33,812)
534,108
5,227
–
1,814

Consolidated$1,023,410–
1,023,410
89,501
1,356,392
75,65919,22863,043

(2) Related Information
Geographic Segments
Information by geographic region for the years ended March 31, 2021 and 2020 is summarized as follows:
Millions of Yen

Net sales:
Japan……………………………………
North America…………………………
Others……………………………………
Total…………………………………

2021¥74,061
13,61525,921¥113,5982020¥87,307
16,12029,656¥133,084

Millions of Yen

Tangible fixed assets:
Japan……………………………………
Others……………………………………
Total…………………………………

2021¥18,0457,546¥25,592

Thousands of U.S.dollars(Note 4)2021
$667,222
122,663
233,524$1,023,410
Thousands of U.S.dollars(Note 4)2021
$162,573
67,990$230,564

2020¥18,713
7,356¥26,069(3) Information on both "amortization of goodwill" and "unamortized balance" by reportable segments as at and for theyears ended March 31, 2021 and 2020 is summarized as follows:

Amortization of goodwill…………………
Unamortized balance………………………

Millions of Yen
2021
Reportable segments
Time information Environment
Total
system business system business
¥300
57
¥358
¥1,59814¥1,612Eliminations/
Corporate
–
–

Total
¥358
¥1,612Millions of Yen
2020

Amortization of goodwill…………………
Unamortized balance………………………

Reportable segments
Time information
Environment
system business system business¥487
59¥1,84374

Amortization of goodwill…………………
Unamortized balance………………………

Thousands of U.S.dollars (Note 4)
2021
Reportable segments
Eliminations/Time information Environment
Corporate
Total
system business system business$2,707521$3,229––$14,397
126$14,524

Total¥547¥1,918Eliminations/
Corporate
–
–

Total
¥547
¥1,918

Total$3,229$14,524(4) Information on "Impairment loss of fixed assets" by reportable segments for the years ended March 31, 2021 and2020 is summarized as follows

Impairment loss……………………………

Millions of Yen
2021
Reportable segments
Time information Environment
Total
system business system business¥1,121–¥1,121

Impairment loss……………………………

Thousands of U.S. dollars ( Note 4 )Reportable segments
Eliminations/Time information Environment
Corporate
Total
system business system business$10,101–$10,101–

37

Eliminations/
Corporate–

Total¥1,121

Total$10,10122. Per Share Data
Net assets and net income per share as at and for the years ended March 31, 2021 and 2020 are as follows:(1) Net assets per share
Yen

Net assets per share …………………………………

2021¥1,485.46

The basis for these calculations is as follows:
Total net assets in consolidated balance sheet……
Amount to be deducted from total net assets ……
(Out of the above non-controlling interest portion)……
Net assets relating to common stock………………

U.S.dollars (Note 4)

2020¥1,454.47

Thousands of U.S.dollars(Note 4)

Millions of Yen

2021¥111,585
733(733)
110,8512021$13.383

2020¥109,478
783(783)
108,695

2021$1,005,274
6,611(6,611)
998,658

SharesNumber of shares of common stock used tocompute net assets per share ………………………

2021

2020

74,624,428

74,731,928(2) Net income per share
Yen

Net income per share ………………………………

2021¥97.08

U.S.dollars (Note 4)2020¥141.402021$0.875

Notes: Diluted net income per share is omitted as there were no potential shares with dilutive effect.
The basis for these calculations is as follows:
Millions of Yen

Net income in the consolidated statement of income……
Net income relating to common stock …………

2021
¥7,248
7,248

2020¥10,567
10,567

Thousands of U.S.dollars(Note 4)2021
$65,299
65,299

SharesAverage number of shares ofcommon stock outstanding during the year……

2021

2020

74,660,620

74,732,535(3) Shares remaining in trust of the Director's Compensation BIP Trust and the Employee Stock Ownership Plan (J-ESOP)

recognized in shareholders' equity as treasury stock are included in treasury stock to be deducted in the calculation of
the average number of shares outstanding over the period to calculate net income per share and also included intreasury stock to be deducted in the calculation of the number of shares of treasury stock at the end of the period to
calculate net assets per share. The average number of shares of such treasury stock outstanding over the period that was
deducted to calculate net income per share was 314,300 shares for the previous fiscal year and 385,352 shares for the current
fiscal year. The number of shares of treasury stock at the end of the period that was deducted to calculate net assets
per share was 314,300 shares for the previous fiscal year and 421,314 shares for the current fiscal year.

38

23. Significant Subsequent Events
On April 26, 2021, the Board of Directors of the Company approved the resolution to acquire treasury stock pursuant to theprovisions of Article 156 of the Companies Act as applied by replacing certain terms under the provisions of Article 165, Paragraph 3 of the same Act.
(1) Reasons for acquisition of treasury stock
While strengthening shareholder returns, treasury stock is acquired in order to flexibly carry out its capital management
strategies and to improve capital efficiency in response to changes in the business environment.
(2) Reasons for acquisition of treasury stock
Class of shares to be acquired:Common stock of the Company
Total number of shares to be acquired:Up to 750,000 shares (upper limit):[Representing 1.00% of the Total number of shares issued (excluding treasury stock)]
Total acquisition cost
:Up to 2,250,000,000 yen (upper limit).:[Up to 20,270 Thousands of U.S. dollars ( Note 4 ) ]Acquisition period.:From April 27, 2021 to September 30, 2021

39

Corporate Data
Domestic Operations
HEAD OFFICESALES OFFICESDOMESTIC SUBSIDIARIES275 Mamedocho, Kohoku-ku, Yokohama,
Kanagawa, JAPAN 222-8558

72 Sales Offices Located in major cities,
including

AMANO MANAGEMENT SERVICE CORPORATIONAMANO MAINTENANCE ENGINEERING CORPORATIONAMANO BUSINESS SOLUTIONS CORPORATIONAMANO SECURE JAPAN CORPORATIONENVIRONMENTAL TECHNOLOGY CO., LTD.
AMANO MUSASHI ELECTRIC CORPORATIONAMANO AGENCY CORPORATIONFACILITIESSAPPORO Office, SENDAI Office
OMIYA Office, TOKYO Office
NAGANO Office, NIIGATA Office
YOKOHAMA Office, HAMAMATSU Office
NAGOYA Office, KANAZAWA Office
KYOTO Office, OSAKA Office
OKAYAMA Office, HIROSHIMA Office
TAKAMATSU Office, FUKUOKA Office

SAGAMIHARA Factory
HOSOE Factory

Board of Directors
Chairman & Representative Director(Full-time) Audit & Supervisory Board Members

Izumi NAKAJIMA
President & Representative Director

Masahiko MORITA
Yasuhiro SASAYA

Hiroyuki TSUDA(Outside) Audit & Supervisory Board Members

Director & Managing Operating Officers

Hanae NAKAYA
Naofumi NAGAKAWA

Kunihiro IHARA
Manabu YAMAZAKI

Kouji AKIYAMA
Takeya HAYASHITANI
Takatoshi TAKAHASHI
Tetsuji ISHIKAWA
Yasuo FUJII
Masashi NABESHIMAManaging Operating Officer

Susumu IKOMA

Director & Operating Officers

Operating Officers

Kirihito NINOMIYA
Fujinori TAZO

Myeong-Jin JEON
Yoshihiko HATA
Hiroyuki KOBARI
Toshiyuki NISHIKIORI
Hideo HONDA(Outside) Directors

Kiyoshi KAWASHIMA
Michinobu OMORI
Sumie WATANABE

Overseas Operations
1. AMANO USA HOLDINGS,INC.
2. AMANO CINCINNATI,INC.
3. AMANO CINCINNATI,INC. OHIO FACTORY
4. AMANO McGANN CANADA INC.
5. AMANO PIONEER ECLIPSE CORPORATION
6. AMANO McGANN, INC.
7. ACCU-TIME SYSTEMS, INC.
8. AMANO TIME&ECOLOGY DE MEXICO S.A. DE C.V.

9

17.		AMANO SOFTWARE ENGINEERING (SHANGHAI)CO.,LTD.
9. ACCU-TECH SYSTEMS, Ltd.
18.		AMANO PARKING SERVICE LTD.
10. AMANO EUROPE HOLDINGS, N.V.
19.		AMANO MALAYSIA SDN.BHD.
11. AMANO EUROPE, N.V.
20.		AMANO TIME&AIR SINGAPORE PTE.LTD.
12. AMANO TIME&PARKING SPAIN S.A.
21.		PT.AMANO INDONESIA
13. HOROQUARTZ, S.A.
22.		AMANO THAI INTERNATIONAL CO.,LTD.
14. HOROQUARTZ MOROCCO, S.A.
23.		AMANO VIETNAM CO.,LTD.
15. AMANO KOREA CORPORATION
16. AMANO INTERNATIONAL TRADING(SHANGHAI)CO.,LTD.

10,11

13

6

12
15

14

19

22

8

23

20
21

40

3
5

AMANO CORPORATION

16,17
18

4

7
1,2

275 Mamedocho, Kohoku-ku, Yokohama, Kanagawa, 222-8558 JAPAN
PHONE : +81 (45) 401-1441
FAX: +81 (45) 439-1150
HOME PAGE : http://www.amano.co.jp/English/