Ryoyo Electro : Results Briefing Material for the Year Ended

Results Briefing for Fiscal Year Ended

January 31, 2023

March 10, 2023

Ryoyo Electro Corporation

Prime Market, Tokyo Stock Exchange (Ticker Code: 8068)

https://www.ryoyo.co.jp/en/

Copyright 2023 © Ryoyo Electro Corporation

Overview of Fiscal Year Ended

January 31, 2023

1	Copyright 2023 © Ryoyo Electro Corporation

Intentions for the annual business plan

at beginning of year and changes through the year

Intentions at the beginning of the year

The impact of the component supply shortage was severe at the beginning of the fiscal year and was expected to continue until the latter half of the fiscal year.

Although sales for TVs were expected to remain relatively high, overheating was expected to subside following the rapid expansion up through last fiscal year.

The contribution was expected to peak in this fiscal year, with some projects sliding from the previous fiscal year.

Change in forms of transaction for some large-lot business was expected to have an impact from the second half of the fiscal year.

(Not factored in at the beginning of the period)

Main factors

Semiconductor

Market Conditions

Semiconductor

Business for TVs

Online

Eligibility

Verification

Business

Software

Business

Exchange Rate

Trends

Changes through the year

While the temporary increase in demand exceeded our initial expectations, a gradual balancing of supply and demand is beginning to be seen in some fields.

Along with the absence of any big decline, new projects contributed to the results, and the year ended with a YoY increase in sales.

This business expanded as initially expected, and an extension of government subsidies is also expected to have a positive impact for the next fiscal year.

Since large-lot business did not come to an end, the impact of this factor on the current fiscal year is expected to be minor.

A rapid depreciation of the yen drove up profitability.

Although sales are expected to decline		The earnings forecast was revised upward
mainly due to changes in the business		twice during the period, so sales and profits are
environment for large-lot business,		expected to significantly exceed the initial plan.
estimated operating profit increased slightly		(Operating profit reached a record level for the
YoY due to improved profit margins resulting		first time in 21 years)
from changes in sales composition.	2	Copyright 2023 © Ryoyo Electro Corporation

Profit/loss: Results

• While net sales were initially expected to decline at the beginning of the fiscal year, they continued to increase due to strong demand amid component shortages.
  →Net sales of semiconductors & devices and ICT & solutions both grew year on year.
• Operating profit doubled YoY, and the operating margin greatly surpassed 3%. Operating profit exceeded ¥4 billion for the first time since the fiscal year ended January 31, 2002 (21 years ago).
• With the rise in the profit level, ROE improved significantly to 7.0%, marking the first time it has exceeded 5% since the year ended January 2001.

	FY2022/1*		FY2023/1*			YoY Change
(Billion yen)		Initial	Aug.	Nov.
Result	Revised	Revised	Result			%
	Target
		Target	Target
Net sales	112.1	100.0	113.0	123.0	129.9		+17.8	+15.9%
Gross profit	10.73	10.80	12.35	13.10	13.58		+2.85	+26.6%
(%)	9.6%	10.8%	10.9%	10.7%	10.5%
Selling, general and administrative expenses	8.47	8.50	8.75	8.90	8.89		+0.42	+4.9%
Operating profit	2.26	2.30	3.60	4.20	4.69		+2.44	+107.9%
(%)	2.0%	2.3%	3.2%	3.4%	3.6%
Ordinary profit	2.40	2.20	3.40	4.00	4.48		+2.08	+86.5%
Profit attributable to owners of parent	1.87	1.53	2.35	2.80	3.06		+1.18	+63.1%
ROE	4.7%	3.6%	5.4%	6.4%	7.0%

FY2022/1: Fiscal year ended January 2022, FY2023/1: Fiscal year ended January 2023

3	Copyright 2023 © Ryoyo Electro Corporation

Factors impacting sales change

• Semiconductors & devices: Amid component shortages and stronger-than-expected demand, sales increased YoY for all applications, including industrials and PCs & peripherals.
• ICT & solutions: Sales of embedded products increased significantly, including AI and Deep Learning products, and sales of each item remained at a high level.

(Billion yen)

	Semiconductors & devices			ICT & solutions
	(Net sales by application)				(Net sales by product)
Year-on-year change: Up ¥15.4 billion		Year-on-year change: Up ¥2.5 billion
						Embedded	PC/server/	I/O
						devices	equipment
				Vehicle	& others	network	+0.3
				+0.7
			installation
		Digital	+2.5
			+1.7
		consumer Communication		​	​	Software
		electronics	+2.3
	PCs &			​			-1.1
	+2.7
	peripherals			​
Industrials &
others	+2.7		​
								129.9
+6.1		​
	​
​

112.1

FY2022/1			FY2023/1
Results	4		Results
	Copyright 2023 © Ryoyo Electro	Corporation