Hosiden : Notice of Convocation Annual General Meeting 2022

This document has been translated from a part of the Japanese original for reference purposes only. In the event of any discrepancy between this translated document and the Japanese original, the original shall prevail. The Company assumes no responsibility for this translation or for direct, indirect or any other forms of damages arising from the translation.

Securities Code: 6804

June 7, 2022

To Those Shareholders with Voting Rights

Kenji Furuhashi

President and Representative Director

Hosiden Corporation

4-33, Kitakyuhoji 1-Chome, Yao City,

Osaka

NOTICE OF THE 72ND ORDINARY GENERAL MEETING OF SHAREHOLDERS

• You are cordially invited to attend the 72nd Ordinary General Meeting of Shareholders of Hosiden Corporation (the "Company"). The meeting will be held as described below.
  If you are unable to attend the meeting, you can exercise your voting rights by paper ballot or via the internet, etc. Please review the Reference Documents for the General Meeting of Shareholders, and exercise your voting rights by 5:00 p.m., Tuesday, June 28, 2022.

1. Date and Time:
2. Place:
3. Agenda of the Meeting: Matters to be reported:
   Matters to be resolved: Proposal No. 1: Proposal No. 2: Proposal No. 3: Proposal No. 4:

Proposal No. 5:

Wednesday, June 29, 2022 at 9:00 a.m. (Reception starting from 8:00 a.m.)

Meeting room of Hosiden Corporation

4-33, Kitakyuhoji 1-Chome, Yao City, Osaka, Japan

1. The Business Report, Consolidated Financial Statements for the 72nd Fiscal Term (from April 1, 2021 to March 31, 2022), and results of audits by the Accounting Auditor and the Board of Statutory Auditors of the Consolidated Financial Statements
2. Non-ConsolidatedFinancial Statements for the 72nd Fiscal Term (from April 1, 2021 to March 31, 2022)

Appropriation of Surplus

Partial Amendments to the Articles of Incorporation Election of Two Substitutes for Statutory Auditors

Determination of Compensation for Granting Restricted Stock to Directors (Excluding Outside Directors)

Payment of Bonuses to Directors

Measures to Prevent the Spread of Coronavirus Disease (COVID-19)

Requests to Shareholders

1. For preventing the spread of novel coronavirus infection, shareholders are kindly advised to refrain from attending the General Meeting of Shareholders as much as possible regardless of your physical condition.
2. Please exercise your voting rights in advance by using the enclosed Voting Rights Exercise Form or via the internet, etc.

Please refer to the following page for precautionary measures for prevention of the novel coronavirus infection to be taken by the Company on the day of the General Meeting of Shareholders.

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Measures of the Company at the Meeting and Requests to Our Shareholders Attending the Meeting The Company will take the following measures to prevent the novel coronavirus infection. We would like to ask all shareholders for their understanding and cooperation.

For shareholders attending the General Meeting of Shareholders

For shareholders considering attending the meeting, please fully confirm the situation of the infection on the day of the meeting and your physical condition such as not having a fever before leaving your home and ensure that you do not overextend yourself.

Measures to be taken at the venue of the General Meeting of Shareholders

• 1. We ask all shareholders attending the meeting to cooperate by wearing masks and using alcohol-based disinfectant, as well as taking your temperature.
  2. The admission of shareholders who seem to be unwell, who have symptoms such as coughing and fever and/or who cannot cooperate our precautionary measures may be restricted.
  3. Officers and operating staff will be wearing masks.
  4. As we plan to make space between the seats, the number of seats available is limited. Therefore, even though you come to the meeting venue on the day of the meeting, your admission may be restricted.
  5. In order to shorten the time for the shareholders attending the meeting, the meeting will be held in a smooth manner.
  6. Please be noted that no souvenir and beverages, etc. will be served. We appreciate your understanding.
• The details of the measures may be changed due to future circumstances. In the event of any major changes in the operation of the General Meeting of Shareholders, the changes will be published on our website (https://www.hosiden.com).

………………………………………………………………………………………………………………………..

-For those attending, please present the enclosed Voting Rights Exercise Form at the reception desk on arrival at the meeting.

-The following matters, which should be provided together with this notice, are posted on our website (https://www.hosiden.com) pursuant to the provisions of laws and regulations and Article 14 of the Articles of Incorporation of the Company, and are therefore not included in the attachments to this notice.

1. Notes to Consolidated Financial Statements, which are part of the Consolidated Financial Statements
2. Notes to Non-consolidated Financial Statements, which are part of the Non-consolidated Financial Statements

Accordingly, the Consolidated Financial Statements and Non-consolidated Financial Statements included in the attachments to this notice are part of the consolidated financial statements and non-consolidated financial statements audited by the Accounting Auditor and the Statutory Auditors when preparing the audit reports. -Any and all corrections that occurred with regard to the Reference Documents for the General Meeting of Shareholders, Business Report, Non-Consolidated and Consolidated Financial Statements will be published on our website (https://www.hosiden.com).

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(REFERENCE)

Financial Highlights (Year ended March 31)

		March 2018	March 2019	March 2020	March 2021	March 2022
1. Consolidated financial highlights
Net sales	(Millions of yen)	299,440	233,435	211,912	233,934	207,608
Ordinary income (loss)	(Millions of yen)	10,548	13,357	11,353	13,401	15,786
Net income (loss)	(Millions of yen)	10,233	10,709	9,433	10,338	11,901
Comprehensive income	(Millions of yen)	10,928	9,516	8,178	11,932	13,469
Net assets	(Millions of yen)	86,992	94,113	100,767	109,250	119,533
Total assets	(Millions of yen)	138,192	133,470	150,161	161,894	171,525
Net assets per share	(Yen)	1,463.09	1,609.93	1,723.79	1,935.14	2,175.11
Net income (loss) per share	(Yen)	172.11	180.62	161.37	178.70	211.57
Diluted net income per share	(Yen)	165.35	168.70	150.38	166.28	196.32
Equity ratio	(%)	63.0	70.5	67.1	67.5	69.7
Return on equity	(%)	12.5	11.8	9.7	9.8	10.4
Cash flows from operating	(Millions of yen)	3,757	25,593	2,122	12,590	(1,230)
activities
Cash flows from investing	(Millions of yen)	(5,673)	(5,168)	(4,775)	(2,360)	(3,059)
activities
Cash flows from financing	(Millions of yen)	8,832	(4,544)	(2,147)	(3,860)	(3,748)
activities
Cash and cash equivalents at	(Millions of yen)	52,405	68,061	62,649	69,522	62,479
year-end
2. Non-Consolidated financial highlights
Net sales	(Millions of yen)	239,879	186,942	167,075	197,085	161,003
Ordinary income (loss)	(Millions of yen)	7,143	8,811	5,701	8,381	11,424
Net income (loss)	(Millions of yen)	6,789	6,584	4,566	9,206	14,064
Common stock	(Millions of yen)	13,660	13,660	13,660	13,660	13,660
Total number of shares issued	(Thousand shares)	67,710	67,710	67,710	67,710	64,710
Net assets	(Millions of yen)	64,815	68,655	71,484	78,137	88,939
Total assets	(Millions of yen)	121,119	110,821	121,913	131,109	133,435
Net assets per share	(Yen)	1,090.09	1,174.45	1,222.87	1,384.03	1,618.40
Annual dividends per share	(Yen)	20	25	25	25	65
[Interim dividends per share]	[5]	[10]	[10]	[10]	[10]
Net income (loss) per share	(Yen)	114.19	111.05	78.12	159.13	250.01
Diluted net income per share	(Yen)	109.66	103.63	72.68	148.05	232.03
Equity ratio	(%)	53.5	62.0	58.6	59.6	66.7
Return on equity	(%)	11.0	9.9	6.5	12.3	16.8
Payout ratio	(%)	17.5	22.3	32.0	15.5	25.5

Notes: 1. The financial highlights are not presented in the original Notice of the Ordinary General Meeting of Shareholders in Japanese.

1. Moreover, some of the figures in this document have been prepared based on financial statements, which are not included in the original Notice of the Ordinary General Meeting of Shareholders in Japanese.
2. Figures have been prepared in accordance with the accounting principles generally accepted in Japan, which are different in certain respects from application and disclosure requirements of the International Financial Reporting Standards.

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Consolidated Balance Sheet

(As of March 31, 2022)

			(Millions of yen)
Account item	Amount	Account item		Amount
Assets		Liabilities
Current assets	145,572	Current liabilities		36,305
Cash and deposits	49,794	Notes payable and accounts payable		23,614
―trade
Notes receivable―trade
1,253	Short-term borrowings		2,040
Accounts receivable―trade	24,611	Accrued income taxes		3,179
Short-term investment securities	13,699	Provision for directors' bonuses		155
Other		7,315
Merchandise and finished goods	9,923
Long-term liabilities		15,686
Work in process	3,117
Convertible bond-type bonds with		10,051
Raw materials and supplies	38,526	subscription rights to shares
Deferred tax liabilities		1,253
Operating accounts receivable	2,208
Net defined benefit liability		3,577
Other	2,482
Other		803
Allowance for doubtful accounts	(45)
Fixed assets	25,952
Tangible fixed assets	18,559	Total Liabilities		51,991
Buildings and Structures	5,840
Net assets
Machinery and vehicles	6,221
Owners' equity		117,990
Land	3,290	Capital		13,660
Construction in progress	777	Additional paid-in capital		19,596
Retained earnings		94,320
Other	2,429
Treasury stock		(9,586)
	451
Intangible fixed assets	Accumulated other		1,542
Software and other	451	comprehensive income
Unrealized gains on		2,495
Investments and other assets	6,942
available-for-sale securities
Investment securities	4,809	Exchange adjustment account		(1,334)
Net defined benefit asset	267	Re-measurements of defined benefit		381
plans
Deferred tax assets	1,025
Other	1,130
Allowance for doubtful accounts	(290)
Total Net Assets		119,533
Total Assets	171,525	Total Liabilities and Net Assets		171,525

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Consolidated Statement of Income

(From April 1, 2021 to March 31, 2022)

			(Millions of yen)
Account item		Amount
Net sales			207,608
Cost of sales			185,884
Gross profit			21,724
Selling, general and administrative expenses			9,999
Operating income			11,725
Non-operating income	221
Interest and dividends income
Exchange gain	3,558
Subsidies for employment adjustment	192
Other	150		4,122
Non-operating expenses
Interest expenses	35
Commission for syndicate loan	17
Other	8		61
Ordinary income			15,786
Extraordinary income	370
Profit on disposal of fixed assets
Gain on sales of investment securities	225
Other	1		598
Extraordinary losses	34
Loss on disposal and sales of fixed assets
Impairment loss	43		78
Income before income taxes			16,306
Income taxes―current			4,391
Income taxes―deferred			12
Net income			11,901
Profit attributable to non-controlling interests			-
Profit attributable to owners of parent			11,901

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