Conexio : ［Delayed］[Summary］Non-consolidated Financial Results for the Year Ended March 31,2021

Note:This document is a translation of a part of the original Japanese version and provided for reference purposes only. In the event of any discrepancy between the Japanese original and this English translation, the Japanese original shall prevail.

Non-consolidated Financial Results

for the Year Ended March 31, 2021 [Japanese GAAP]

																April 30, 2021
Company name: CONEXIO Corporation						Stock exchange listing: Tokyo
Code number: 9422						URL: https://www.conexio.co.jp
Representative:	Hiroshi Suguta						President
Contact:	Shinya Nakada						General Manager, Corporate Planning Department
Phone: [phone]
Scheduled date of Annual General Meeting of Shareholders: June 23, 2021
Scheduled date of commencing dividend payments: June 24, 2021
Scheduled date of filing annual securities report: June 23, 2021
Availability of supplementary briefing material on annual financial results: Yes
Schedule of annual financial results briefing session: Yes
									(Amounts of less than one million yen are rounded down)
1. Non-consolidated Financial Results for the Fiscal Year Ended March 31, 2021 (April 01, 2020 to March 31, 2021)
(1) Non-consolidated Operating Results					(% indicates changes from the previous corresponding period.)
		Net sales					Operating profit		Ordinary profit			Profit
Fiscal year ended		Million yen			%		Million yen	%		Million yen		%		Million yen		%
March 31, 2021		188,795			(9.7)		10,676	3.3		11,075		5.3		7,536		7.6
March 31, 2020		209,005		(20.8)		10,330	0.5		10,515		(0.2)		7,000		1.1
		Basic earnings per		Diluted earnings per	Rate of return on	Ordinary profit to	Operating profit to
		share					share	equity		total assets ratio	net sales ratio
Fiscal year ended			Yen				Yen			%			%			%
March 31, 2021		168.45					-			15.5			11.0			5.7
March 31, 2020		156.48					-			15.8			10.6			4.9

(Reference) Equity in earnings (losses) of affiliated companies: Fiscal year ended March 31, 2021: Fiscal year ended March 31, 2020:

(2) Non-consolidated Financial Position

• - million
• - million

		Total assets	Net assets	Capital adequacy ratio		Net assets per share
As of			Million yen			Million yen		%		Yen
March 31, 2021			105,315			51,140		48.6			1,143.13
March 31, 2020			95,757			46,287		48.3			1,034.64
(Reference) Equity: As of		March 31, 2021:	¥		51,140 million
As of		March 31, 2020:	¥		46,287 million
(3) Non-consolidated Cash Flows
		Cash flows from	Cash flows from	Cash flows from		Cash and cash
			equivalents at the end
		operating activities	investing activities	financing activities
				of period
Fiscal year ended			Million yen			Million yen		Million yen			Million yen
March 31, 2021			5,329			(1,473)		(2,687)		21,665
March 31, 2020			13,118			(1,290)		(2,685)		20,499
2. Dividends
			Annual dividends			Total		Payout	Dividends
		1st	2nd	3rd		Year-end	Total	dividends			ratio	to net
	quarter-end	quarter-end	quarter-end				assets
Fiscal year ended		Yen	Yen	Yen		Yen	Yen	Million yen			%	%
March 31, 2020	-	30.00	-		30.00	60.00	2,684			38.3	6.1
March 31, 2021	-	30.00	-		35.00	65.00	2,907			38.6	6.0
Fiscal year ending	-	35.00	-		35.00	70.00				47.4
March 31, 2022(Forecast)

3. Non-consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2022 (April 01, 2021 to March 31, 2022)

(% indicates changes from the previous corresponding period.)

	Net sales		Operating profit	Ordinary profit		Profit		Basic earnings per
				share
	Million yen		%	Million yen	%	Million yen		%	Million yen		%	Yen
Full year	190,000		0.6	9,700	(9.1)	9,700	(12.4)	6,600		(12.4)	147.53

* Notes:

1. Changes in accounting policies, changes in accounting estimates and retrospective restatement
2. 1. Changes in accounting policies due to the revision of accounting standards: No
   2. Changes in accounting policies other than 1) above: No
   3. Changes in accounting estimates: No
   4. Retrospective restatement: No
3. Total number of issued shares (common shares)
4. 1. Total number of issued shares at the end of the period (including treasury shares):

March 31, 2021:	44,737,938	shares
March 31, 2020:	44,737,938	shares
2) Total number of treasury shares at the end of the period:
March 31, 2021:	153	shares
March 31, 2020:	122	shares

3) Average number of shares during the period:
Fiscal Year ended March 31, 2021:	44,737,788	shares
Fiscal Year ended March 31, 2020:	44,737,816	shares

• This Financial Results is not subject to audit procedures.
• Explanation of appropriate use of financial forecasts and other special notes
• • Financial forecasts and other forward-looking statements herein are based on information available to the Company and certain assumptions deemed reasonable as at the time of preparing this report. The Company does not guarantee that any forecasts would be met. Actual results may vary significantly from the forecasts due to a wide range of factors. For information on assumptions of the financial forecasts and matters to be heeded upon using the financial forecasts, please refer to "1. Overview of operating results, etc.
    (3) Outlook" on page 4 of the Appendix.

CONEXIO Corporation (9422)

Non-consolidated Financial Results for the Year Ended March 31, 2021 [Japanese GAAP]

1. Overview of operating results, etc.

1. Overview of operating results for the fiscal year ended March 31, 2021

(i) Operating results for the fiscal year ended March 31, 2021

During the fiscal year ended March 31, 2021, Japan's economy remained largely sluggish due to growing impact of the COVID- 19 pandemic, with both consumer spending and employment having slowed. In addition, socioeconomic activities, which had temporarily showed a sign of recovery, have remained severely challenging by several factors, including the resurgence of the COVID-19 cases.

In the mobile phone market where the Company operates business, it shortened business hours, temporarily closed shops and responded only to limited customer requests at its carrier-certified shops nationwide, in response to the state-of-emergency declaration by the Japanese government in April, requests from the Ministry of Internal Affairs and Communications, and policies of telecom carriers, issued amid the COVID-19 pandemic. After the state-of-emergency declaration was lifted, however, its customer footfall and handset unit sales recovered, as the operation of its carrier-certified shops was back to normal. Also, commercial services of the new telecommunication standard 5G (the 5th generation telecommunication system) were launched, and 5G-compliant handsets have become widespread, helped by the roll-out of its popular new models. In addition, telecom carriers announced revamped pricing plans, revitalizing the market into a new phase of competition.

Under such a business environment, our handset unit sales totaled 1.81 million units (down 10.3% year-on-year) due in part to the voluntary restraint on business activities amid the COVID-19 pandemic during the three months ended June 30, 2020. Meanwhile, we achieved an increase in operating profit for the 10th consecutive year and an increase in profit for the 9th consecutive year due to the revenue growth achieved through our own initiatives (such as mobile help desk services for corporate clients) and increased sales of prepaid cards.

As a result, for the fiscal year under review, net sales were 188,795 million yen (down 9.7%), operating profit was 10,676 million yen (up 3.3%), ordinary profit was 11,075 million yen (up 5.3%) and profit was 7,536 million yen (up 7.6%).

◆Financial results			(Million yen)
	Account title	FY2019	FY2020	Year-on-year change
				(%)
	Net sales	209,005	188,795	(9.7)
	Operating profit	10,330	10,676	3.3
	Ordinary profit	10,515	11,075	5.3
	Profit	7,000	7,536	7.6

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CONEXIO Corporation (9422)

Non-consolidated Financial Results for the Year Ended March 31, 2021 [Japanese GAAP]

The financial results of each business segment were as follows.

Consumer Business

In the Consumer Business, the Company acts as an intermediary for concluding contracts for mobile phones and other communications services, provides after-sales services and sells handsets, etc., targeting at consumer customers. In addition, the Company provides its unique service "nexiplus" to meet the needs of smartphone users and strengthen the relationship with them, and the insurance agency business of "HOKEN NO MADOGUCHI".

In the Consumer Business, operating profit decreased due to the decline in handset unit sales despite revenue growth through our own initiatives and COVID-19 support grants from telecom carriers, which were insufficient to cover said revenue decrease. The Company continued to serve its customers at its carrier-certified shops, while implementing thoroughgoing measures to avoid 3Cs (closed spaces, crowded places, and close-contact settings) to protect against infection with COVID-19. The Company also expanded the lineup of its unique "nexi" service package, and the membership of the service increased steadily. Further, as a new initiative, the Company made efforts to enhance new contact opportunities with customers by opening a pop-up shops in retail outlets, such as shopping malls.

As a result, the Consumer Business segment recorded net sales of 169,858 million yen (down 11.4% year-on-year) and operating profit of 12,462 million yen (down 5.6% year-on-year).

◆Financial results			(Million yen)
	Account title	FY2019	FY2020	Year-on-year change
				(%)
	Net sales	191,810	169,858	(11.4)
	Operating profit	13,196	12,462	(5.6)

Corporate Business

In the Corporate Business, the Company acts as an intermediary for concluding contracts for mobile phones and other communication services, provides after-sales services and sells mobile phone handsets, etc., targeting at corporate customers. The Company also offers mobile handset management and operation services to corporate customers (outsourcing services covering mobile help desk, handset set-up (kitting), etc.), solution products, prepaid cards to convenience stores, and IoT solutions.

In the Corporate Business, sales of smartphones remained strong, backed by growing demand for telework. With such trend, the number of new contracts of commercial mobile solution services that promote workstyle reforms and the number of such solutions newly introduced increased. As for our mobile help desk service, the number of subscriptions to the service increased, driven by the promotion of telework by existing customers; and the average sales per customer also rose resulting in the achievement of profit growth, helped by an expansion in the scope of service due to a shift to smartphones. As for IoT solutions, the Company, along with its partner companies, participated in Nokia Local 5G Technology Partnership, an industry-wide alliance to accelerate the development of local 5G and private LTE systems. We will continue to promote the development and provision of edge computing gateways compatible with local 5G/private LTE. We will also focus on integration of IoT systems, centered on gateways, to bring IoT system integrated solutions to customers in a wide range of sectors, including manufacturing, transportation, construction, service and public work sectors.

As a result of the above, the Corporate Business segment recorded net sales of 18,937 million yen (up 10.1% year-on-year) and operating profit of 2,758 million yen (up 60.9% year-on-year).

◆Financial results			(Million yen)
	Account title	FY2019	FY2020	Year-on-year change
				(%)
	Net sales	17,194	18,937	10.1
	Operating profit	1,714	2,758	60.9

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CONEXIO Corporation (9422)

Non-consolidated Financial Results for the Year Ended March 31, 2021 [Japanese GAAP]

(2) Overview of financial position for the fiscal year ended March 31, 2020

1. Status of assets, liabilities and net assets (Current assets)
   Current assets increased by 10,390 million yen from the end of the previous fiscal year to 85,914 million yen. This is attributable mainly to an increase in accounts receivable-other of 18,976 million yen, an increase in merchandise and finished goods of 1,372 million yen, an increase in cash and deposits of 1,162 million yen, an increase in prepaid expenses of 179 million yen, and a decrease in notes and accounts receivable-trade of 11,342 million yen.

(Non-current assets)

Non-current assets decreased by 832 million yen from the end of the previous fiscal year to 19,401 million yen. This is attributable mainly to a decrease in the right of career shop management of 665 million yen, a decrease in buildings (net) of 241 million yen, a decrease in leasehold and guarantee deposits of 189 million yen, and an increase in deferred tax assets of 395 million yen.

As a result, total assets increased by 9,557 million yen from the end of the previous fiscal year to 105,315 million yen.

(Current liabilities)

Current liabilities increased by 4,483 million yen from the end of the previous fiscal year to 47,583 million yen. This is attributable mainly to an increase in accounts payable-other of 7,631 million yen, an increase in accounts payable-trade of 1,361 million yen, an increase in accrued expenses of 287 million yen, an increase in provision for bonuses of 178 million yen, a decrease in accrued agency commission of 3,757 million yen, a decrease in accrued consumption taxes of 613 million yen, a decrease in income taxes payable of 525 million yen, and a decrease in deposits received of 155 million yen.

(Non-current liabilities)

Non-current liabilities increased by 220 million yen from the end of the previous fiscal year to 6,591 million yen. This is attributable mainly to an increase in provision for retirement benefits of 313 million yen, and a decrease in asset retirement obligations of 72 million yen.

As a result, total liabilities increased by 4,704 million yen from the end of the previous fiscal year to 54,174 million yen.

(Net assets)

Net assets increased by 4,853 million yen from the end of the previous fiscal year to 51,140 million yen. This is attributable mainly to an increase due to the profit recognized in the amount of 7,536 million yen and a decrease due to dividends paid in the amount of 2,684 million yen.

As a result, the Company's equity ratio reached 48.6%.

(ii) Status of cash flows

Cash and cash equivalents (hereinafter referred to as "Cash") at the end of the current fiscal year increased by 1,165 million yen from the end of the previous fiscal year to 21,665 million yen.

(Cash flows from operating activities)

Cash obtained from operating activities was 5,329 million yen (down 7,789 million yen from the previous fiscal year). This was mainly because the increasing factors, including a decrease in trade receivables of 11,381 million yen, the recognition of profit before income taxes of 10,832 million yen, an increase in accounts payable-other of 7,639 million yen, and the recognition of depreciation of 1,932 million yen, exceeded the decreasing factors, including an increase in accounts receivable-other of 18,976 million yen, income taxes payable of 4,160 million yen, and a decrease in trade payables of 2,395 million yen, and an increase in inventories of 1,345 million yen.

(Cash flows from investing activities)

Cash used for investing activities was 1,473 million yen (up 183 million yen from the previous fiscal year). This was mainly due to the expenditure of 943 million yen for the purchase of property, plant and equipment and the expenditure of 268 million yen for the purchase of intangible assets.

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