Kaga Electronics : Earnings Presentation FY2023/3 Q1

For Institutional Investors/Analystssts

Consolidated Financial Results for the First Quarter of the Fiscal Year ending March 2023

KAGA ELECTRONICS CO., LTD.

TSE Prime Market 8154

August 4, 2022

Summary of Financial Results

for the First Quarter Ended June 30, 2022

• Net sales increased by 43.3 billion yen or 40.9% year on year to 149.3 billion yen, driven by the core electronic components business. Sales expanded in a wide range of areas, led by automotive and industrial equipment related applications.
• Operating income increased by 5.3 billion yen or 120.6% year on year to 9.8 billion yen.

FY2023/3		Improved gross profit margin attributable to higher sales and sales mix resulted in
1Q Results		substantial rise in gross profit.
	All objectives from net sales to ordinary income for the quarter achieved record highs
		for a first quarter.
	 Net sales and operating income both exceeded the internal plan, by approx. 27.0 billion
		yen and 4.6 billion yen respectively.
	 Given uncertainties in the outlook due to factors including COVID-19, the situation in Ukraine
		and exchange fluctuations, upward revision was made factoring in the 1Q upside only.
FY2023/3		Forecasts for 2Q and beyond are unchanged from the initial forecasts.
earnings		(billion yen)		Net Sales		Operating income	Net income
Forecasts
	Previous forecasts		510.0		21.2	14.5
		Revised forecasts		540.0		24.0	16.0

Effect of

exchange

rates

• Relative to the US dollar and other major currencies, the yen generally trended downward, weakening to below compared to the same period the previous year earlier levels and plan assumptions. The effect of exchange rates on the conversion into yen of the P&L of the Group's overseas companies is as follows.

(billion yen)	Net Sales	Operating income
YoY	approx 9.4	approx 0.4
vs Plan	approx 5.6	approx 0.3

1

Financial Highlights for FY2023/3 1Q

							（million yen）
	FY2022/3	FY2023/3	YoY	FY2023/3		Progress
	Forecasts
	1Q Results	1Q Results		rate
		(announced on May. 12, 2022)
Net sales	105,949		149,302		40.9%	510,000		29.3%
Gross Profit	13,550	12.8%	19,838	13.3%	46.4%	ー	ー	ー
SG&A	9,098	8.6%	10,018	6.7%	10.1%	ー	ー	ー
Operating income	4,452	4.2%	9,820	6.6%	120.6%	21,200	4.2%	46.3%
Ordinary income	4,566	4.3%	9,858	6.6%	115.9%	21,200	4.2%	46.5%
Profit attibutable to	2,872	2,7%	6,984	4.7%	143.2%	14,500	2.8%	48.2%
owners of parent
EPS (yen)	104.55	ー	266.10	ー	ー	552.42	ー	ー
Exchange Rate yen / USD	109.49	ー	129.57	ー	ー	116.00	ー	ー

Note: "x. x% " represents the profit margin.

2

Financial Results by Business Segment for FY2023/3 1Q

								（million yen）
		FY2022/3	FY2023/3		YoY	FY2023/3		Progress
			Forecasts
		1Q Results	1Q Results		rate
			(announced on May. 12, 2022)
Electronic	Net sales	90,624		133,477		47.3%	447,000		29.9%
Component	Segment income	3,699	4.1%	9,018	6.8%	143.7%	18,500	4.1%	48.7%
Information	Net sales	10,636		11,147		4.8%	39,000		28.6%
Equipment	Segment income	568	5.3%	564	5.1%	-0.6%	2,000	5.1%	28.2%
Software	Net sales	568		498		-12.3%	4,000		12.5%
Segment income	-67	-11.8%	-33	-6.7%	ー	100	2.5%	ー
Others	Net sales	4,120		4,178		1.4%	20,000		20.9%
Segment income	217	5.3%	249	6.0%	14.7%	600	3.0%	41.5%
Total	Net sales	105,949		149,302		40.9%	510,000		29.3%
Segment income	4,452	4.2%	9,820	6.6%	120.6%	21,200	4.2%	46.3%

Note: Figures of each segment income are not inter-segment adjusted. Total amount is inter-segment adjusted (operating income).

"x. x% " represents the profit margin.

3

Effect of M&A

Net Sales

All three companies achieved significant increases in net sales driven by the electronic components business.

	+24,223	+15,607	+3,521	149,302
105,949
2022/3	Kaga	Kaga FEI	Excel	2023/3
1Q	Electronics	FY2023/3	1Q
	SG&A	/ SG&A ratio

SG&A ratio was kept down despite an increase in SG&A expenses resulting from a growth in sales.

9,098	+927	+39		10,018
		-47
9.9%
	8.1%
8.1%		5.6%		6.7%
8.6%		2.9%
4.0%
2022/3	Kaga	Kaga FEI	Excel	2023/3
	1Q	Electronics	FY2023/3	1Q

（million yen）

Gross profit / Gross profit margin

Kaga FEI achieved a significant increase in gross profit, reflecting higher sales and improved profit margin.

		+3,452	+2,775		19,838
13,550		-92
16.0%		15.5%	12.1%		13.3%
12.8%
9.4%
			5.7%
7.9%
2022/3	Kaga	Kaga FEI	Excel	2023/3
	1Q	Electronics	FY2023/3	1Q

Operating income / Operating income marjin

Kaga Electronics and Kaga FEI contributed significantly to achieve 6.6% operating income margin.

			+2,693		9,820
		+2,532		-44
4,452	7.4%	6.4%		6.6%
6.2%
4.2%		2.7%
3.7%
1.1%		Kaga	Kaga FEI	Excel	2023/3
2022/3
	1Q	Electronics	FY2023/3	1Q

Note :With respect to gross profit and operating income, figures presented above are before consolidation	4
adjustments between the two companies. For reference, after consolidation adjustments, gross profit
stood at 25million yen, and operating income came to 65million yen.