Hosiden : Financial Results Briefing for the Fiscal Year Ended March 31, 2023

HOSIDEN CORPORATION

Financial Results Briefing for the Fiscal Year Ended March 31, 2023

Summary of financial results has been added.

• Part 1: Commentary on financial results briefing materials
• Part 2: Message from Kenji Furuhashi, President & CEO
• Part 3: Main Q&A

Held at 10:30 a.m. on May 17, 2023

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Part 1

Commentary on financial results

briefing materials

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Summary of Consolidated Financial Results for FY2022

Overall net sales were 277.2 billion yen, up 33.5% from the previous year (up 69.6 billion yen in value). This was mainly due to an increase of 66.0 billion yen in the amusement business, an increase of 2.1 billion yen in the mobile communications business, and an increase of 2.7 billion yen in other businesses. In contrast, sales in the automotive business fell by 1.3 billion yen.

In profits, operating profit increased by 34.3% year-on-year, mainly due to the depreciation of the yen, which led to an increase in the yen value of the difference between dollar sales and dollar purchases, as well as valuation gains on dollar purchase inventories. In monetary value terms, operating profit increased by 4 billion yen to 15.8 billion yen. A large part of the foreign exchange impact on operating profit came from the valuation gains on dollar purchase inventories, and this took place mainly in the first quarter. Foreign exchange gains of 2.5 billion yen were also recorded as non-operating income due to the weaker yen. As a result, ordinary profit increased by 3.1 billion yen year-on-year to 19.0 billion yen.

			(Unit: Millions of yen)
	FY2021	FY2022	Rate of change
Net sales	207,608	277,244	33.5%
Operating profit	11,725	15,750	34.3%
Ordinary profit	15,786	18,984	20.3%
Profit attributable to	11,901	12,637	6.2%
owners of parent
Net assets	119,533	126,753	6.0%

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Summary of Consolidated Statements of Income and Consolidated Statements of Comprehensive Income

The reason for the sales forecast for the 2023 fiscal year being 8% lower than the previous year, or a decrease of

1. billion yen in value, is mainly due to a 16% decrease in sales in the amusement business, which is a decrease of

1. billion yen in value. Sales in all businesses other than the amusement business are expected to increase year-on- year. We expect selling, general and administrative expenses to be on par with the previous year.
   Operating profit is forecast to decrease by 37% year-on-year, or 5.8 billion yen in value, because of the decrease in sales and expectations that inventory valuation gains due to the yen's depreciation that were recorded in the previous fiscal year will not be recorded in the 2023 fiscal year. In the 2023 fiscal year, we do not anticipate any non-operating foreign exchange gains or losses, and expect the non-operating income forecast of 1 billion yen to come mainly from interest income. As a result, ordinary profit and profit before tax are expected to be 11.0 billion yen, and net profit is

expected to be 8.5 billion yen.				(Unit: Millions of yen)
	FY2021	FY2022	increase or	FY2023(forecast)
	decrease
Net sales	207,608	277,244	69,636	255,000
Cost of sales	185,884	251,487	65,603	235,000
SGA expenses	9,999	10,007	8	10,000
Operating profit	11,725	15,750	4,025	10,000
Foreign exchange gains/ losses	3,558	2,490	△1,068	-
Other	503	743	240	1,000
Ordinary profit	15,786	18,984	3,198	11,000
Extraordinary profit	598	142	△456	-
Extraordinary losses	78	600	522	-
Profit before income taxes	16,306	18,527	2,221	11,000
Total income taxes	4,404	5,889	1,485	2,500
Profit attributable to owners of parent	11,901	12,637	736	8,500
Comprehensive income	13,469	14,477	1,008	-

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Summary of Consolidated Balance Sheets

Total assets increased by 8.4 billion yen from the end of the previous fiscal year, mainly due to an increase in current assets. The main factors for changes in current assets were an increase in cash and deposits of 7.6 billion yen, an increase in accounts receivable of 9.0 billion yen, and a decrease in inventory assets mainly related to the amusement business of 10.2 billion yen.

In terms of liabilities, current liabilities increased by 1.6 billion yen, mainly due to an increase in trade payables of 2.1 billion yen and an increase in income taxes payables of 700 million yen, despite a decrease in other current liabilities by 1.4 billion yen.

Net assets increased by 7.2 billion yen and the equity-to-asset ratio increased by 0.7 percentage points from the end of the previous fiscal year to 70.4%.

(Unit: Millions of yen)

	Mar. 31, 2022	Mar. 31, 2023	increase or
	decrease
Assets
Current assets	145,572	151,878	6,306
Property, plant and equipment	18,559	17,495	△1,064
Intangible assets, Investments and	7,394	10,619	3,225
other assets
Total assets	171,525	179,993	8,468
Liabilities
Current liabilities	36,305	37,919	1,614
Non-current liabilities	15,686	15,319	△367
Net assets	119,533	126,753	7,220
Total liabilities and net assets	171,525	179,993	8,468

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