Seiko Epson : Ⅰ. Overview of Company

Part 1. Company Information

1. Overview of Company

1. Key financial data

Consolidated financial highlights

			Millions of yen			Thousands of
					U.S. dollars
For the years ended March 31	2018	2019		2020		2021	2022	2022
Revenue	1,102,116	1,089,676		1,043,600		995,940	1,128,914	9,231,449
Profit before tax	62,663	72,040		39,713		44,933	97,162	794,521
Profit for the period attributable to	41,836	53,710		7,733		30,922	92,288	754,665
owners of the parent company
Total comprehensive income for the	41,581	49,542		(3,869)		68,818	136,226	1,113,958
period
Equity attributable to owners of the	512,727	540,181		503,746		550,924	665,628	5,443,028
parent company
Total assets	1,033,350	1,038,389		1,040,910		1,161,314	1,266,420	10,355,875
Equity attributable to owners of the	Yen	Yen		Yen		Yen	Yen	$
parent company, per share	1,455.67	1,533.57		1,456.20		1,592.36	1,923.68	15.73
Basic earnings per share	Yen	Yen		Yen		Yen	Yen	$
118.78	152.49		22.26		89.38	266.73	2.18
Diluted earnings per share	Yen	Yen		Yen		Yen	Yen	$
118.75	152.44		22.25		89.35	266.64	2.18
Equity attributable to owners of the	%	%		%		%	%	-
parent company ratio	49.62	52.02		48.39		47.44	52.56
Return on equity	%	%		%		%	%	-
8.33	10.20		1.48		5.86	15.17
Price earnings ratio	times	times		times		times	times	-
15.92	11.12		52.56		20.14	6.90
Dividend payout ratio	%	%		%		%	%	-
52.2	40.7		278.5		69.4	23.2
Total shareholder return	%	%		%		%	%
(Comparison index: TOPIX (Dividend	83.3	77.6		57.8		87.4	91.8	-
included))	(115.9)	(110.0)		(99.6)		(141.5)	(144.3)
Net cash from (used in) operating	84,279	76,961		102,324		133,222	110,801	906,051
activities
Net cash from (used in) investing	(74,661)	(82,738)		(76,131)		(57,448)	(44,083)	(360,479)
activities
Net cash from (used in) financing	37	(49,430)		(283)		23,150	(51,771)	(423,346)
activities
Cash and cash equivalents at end of	229,678	175,238		196,245		304,007	335,239	2,741,344
period
Number of employees	persons	persons		persons		persons	persons	-
76,391	76,647		75,608		79,944	77,642

(Note) The Consolidated Financial Statements have been prepared on the basis of International Financial Reporting Standards (IFRS) from the year ended March 31, 2014.

U.S. dollar amounts are presented for the convenience of the readers. This translation should not be construed to imply that the yen amounts actually represent, or have been or could be converted into, equivalent amounts in U.S. dollars. The exchange rate of ¥122.290 = U.S.$1 at the end of the reporting period has been used for the purpose of presentation

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2. Company milestones

	Date	Event
	5/1942	Daiwa Kogyo, Ltd. established to manufacture watch parts, launching the watch business
	5/1959	Sales & marketing taken over from the Suwa factory of Daini Seikosha Co., Ltd. (now Seiko
		Instruments Inc.) and the business name was changed to Suwa Seikosha, Ltd.
	9/1959	Reorganized to form Suwa Seikosha Co., Ltd.
	12/1961	Domestic manufacturing company Shinshu Seiki Co., Ltd. (later Epson Corporation) established
	8/1968	Manufacturing company Tenryu Singapore Pte. Ltd. (now Singapore Epson Industrial Pte. Ltd.)
		established
	9/1968	Mini-printer business launched
	11/1973	Semiconductor business launched
	2/1974	Manufacturing company Suwa Overseas Ltd. [now Epson Precision (Hong Kong) Ltd.]
		established
	4/1975	Sales company Epson America, Inc. established
		Corrective lenses business launched (the business was transferred in 2/2013)
	6/1975	EPSON established as a company brand in non-watch businesses
		Liquid crystal display business launched
	7/1976	Quartz crystal device business launched
	12/1978	Computer printer business launched
	11/1979	Sales company Epson Deutschland GmbH established in Germany
	10/1980	Sales company Epson Electronics Trading Ltd. (now Epson Hong Kong Ltd.) established
	11/1982	Sales company Epson Electronics (Singapore) Pte. Ltd. (now Epson Singapore Pte. Ltd.)
		established
	5/1983	Domestic sales company Epson Sales Japan Corporation established
	1/1985	Domestic manufacturing company Shonai Electronics Industry Corporation (now Tohoku Epson
		Corporation) established
	2/1985	Manufacturing company Epson Portland Inc. established in the U.S.
	11/1985	Suwa Seikosha Co., Ltd. and Epson Corporation merged to form Seiko Epson Corporation
	1/1987	Manufacturing company Epson Telford Ltd. established in the U.K.
	1/1989	LCD projector business launched
	9/1989	Sales company Epson Semiconductor GmbH (now Epson Europe Electronics GmbH)
		established in Germany
	1/1990	Regional head office Epson Europe B.V. established in the Netherlands
	1/1993	U.S. Epson, Inc. established
	11/1993	Domestic sales company Epson Direct Corporation established
	7/1994	Manufacturing company P.T. Indonesia Epson Industry established
	2/1996	Manufacturing company Suzhou Epson Quartz Devices Co., Ltd. (later Suzhou Epson Co., Ltd.)
		established in China (all rights and obligations transferred in 7/2011)
	11/1996	Sales company Epson Electronics America, Inc. established (absorbed by Epson America, Inc.
		in 4/2018)
	4/1998	Regional head office Epson (China) Co., Ltd. established
	3/2001	Orient Watch Co., Ltd. made a wholly owned subsidiary
	6/2003	Seiko Epson shares listed on Section 1 of the Tokyo Stock Exchange
	10/2004	Liquid crystal display business split off to form Sanyo Epson Imaging Devices Corporation
	10/2005	Quartz device business split off to form Epson Toyocom Corporation (now Miyazaki Epson
		Corporation)
	12/2006	Sanyo Epson Imaging Devices Corporation made a wholly owned subsidiary through the
		acquisition of additional shares. Business name changed to Epson Imaging Devices Corporation
		(certain assets of the small- and medium-sized LCDs business were transferred in 4/2010).
		Epson Imaging Devices was absorbed by Seiko Epson in 2/2017, with the latter the surviving
		company.
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	Date	Event
	11/2008	Additional shares of Orient Watch Co., Ltd. acquired in a takeover bid
	3/2009	Orient Watch Co., Ltd. made a wholly owned subsidiary via an exchange of shares (the watch
		sales business was split off and absorbed in 4/2017, with Seiko Epson and Epson Sales Japan the
		succeeding companies)
	4/2009	Additional shares of Epson Toyocom Corporation (now Miyazaki Epson Corporation) acquired
		in a takeover bid
	6/2009	Epson Toyocom Corporation (now Miyazaki Epson Corporation) made a wholly owned
		subsidiary via an exchange of shares (sales, marketing and certain other functions related to the
		quartz device business were split off and absorbed in 4/2012, with Seiko Epson the succeeding
		company)
	4/2015	Executed a 2-for-1 stock split of common shares
	6/2016	Transitioned from a company with an audit & supervisory board to a company with an audit &
		supervisory committee
	7/2017	Construction completed on a new factory at manufacturing subsidiary Epson Precision
		(Philippines), Inc. to expand production capacity for inkjet printers and projectors
	6/2018	Construction completed on a new factory at the Hirooka Office in Nagano Prefecture to expand
		inkjet printhead production capacity
	3/2020	Construction completed on a new building at the Hirooka Office in Nagano Prefecture to
		reinforce commercial and industrial printing R&D and production capacity
	4/2022	Company stock transferred from the 1st Section of the Tokyo Stock Exchange to the Prime
		Market in conjunction with a reorganization of the Tokyo Stock Exchange's market segments

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3. Description of business

Epson is primarily engaged in developing, manufacturing, selling, and providing services for products in the printing solutions, visual communications, manufacturing-related and wearables, and the other business.

Epson is organized into operations divisions that come under global consolidated management. The majority of advanced R&D and product development is conducted in Japan (by Corporate R&D and R&D organizations in the various operations divisions), while manufacturing and sales activities are conducted around the world by Epson Group manufacturing and sales companies, both in Japan and abroad.

A brief description of Epson's various businesses is provided below along with a list of the main Epson Group companies involved in each segment.

The reporting segments were changed at the beginning of the fiscal year based on the Epson 25 Renewed corporate vision established in March 2021. The three reporting segments are printing solutions, visual communications, and manufacturing-related and wearables. Each reporting segment is the same as the segments used in "V. Financial Information, 1. Consolidated financial statements, etc., (1) Consolidated financial statements, Notes to Consolidated Financial Statements, 7. Segment Information."

Printing Solutions Business Segment

This segment comprises the office and home printing business, commercial and industrial printing business, and others. The businesses in this segment leverage Epson's original Micro Piezo as well as dry fiber technology and other technologies to develop, manufacture, and sell products and provide services related thereto.

The main activities of these businesses are described below.

Office and home printing business

This business is primarily responsible for office and home inkjet printers, serial impact dot matrix (SIDM) printers, page printers, color image scanners, dry process office papermaking systems, and related consumables.

Commercial and industrial printing business

This business is primarily responsible for inkjet printers for commercial and industrial applications, inkjet printheads, printers for use in POS systems, label printers, and related consumables.

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The major Epson Group companies involved in this segment are listed in the table below.

Business area	Main products	Main Epson Group companies
Manufacturing companies	Sales companies
			Epson Sales Japan Corporation
	Inkjet printers for office and		Epson America, Inc.
		Epson do Brasil Industria e
	home, serial impact dot
		Comercio Ltda.
Office and home	matrix printers, page printers,
	Epson Europe B.V.
color image scanners, dry
printing business	Tohoku Epson Corporation	Epson (U.K.) Ltd.
process office papermaking
	Akita Epson Corporation	Epson Deutschland GmbH
	systems, and related
	Epson Portland Inc.	Epson France S.A.S.
	consumables, and others
	Epson do Brasil Industria e	Epson Italia S.p.A.
		Comercio Ltda.	Epson Como Printing
		Epson Telford Ltd.	Technologies S.r.l.
		Epson Como Printing Technologies	Epson Iberica, S.A.U.
		S.r.l.	Epson (China) Co., Ltd.
	Commercial and industrial	Epson Engineering (Shenzhen) Ltd.	Epson Singapore Pte. Ltd.
	Tianjin Epson Co., Ltd.	Epson Korea Co., Ltd.
Commercial and	inkjet printers, inkjet
PT. Epson Batam	Epson Hong Kong Ltd.
printheads, printers for use in
industrial printing	PT. Indonesia Epson Industry	Epson Taiwan Technology &
POS systems, label printers,
business	Epson Precision (Philippines), Inc.	Trading Ltd.
and related consumables, and
		PT. Epson Indonesia
	others
		Epson (Thailand) Co., Ltd.
			Epson Philippines Corporation
			Epson Australia Pty. Ltd.
			Epson India Pvt. Ltd.

Visual Communications Business Segment

The businesses in this segment leverage Epson's original microdisplay and projection technologies to develop, manufacture, and sell 3LCD projectors mainly for business, education, the home, and event as well as smart glasses and provide services related thereto.

The major Epson Group companies involved in this segment are listed in the table below.

Business area	Main products	Main Epson Group companies
Manufacturing companies	Sales companies
			Epson Sales Japan Corporation
			Epson America, Inc.
			Epson do Brasil Industria e
			Comercio Ltda.
			Epson Europe B.V.
			Epson (U.K.) Ltd.
			Epson Deutschland GmbH
			Epson France S.A.S.
			Epson Italia S.p.A.
Visual	3LCD projectors, smart	Epson Engineering (Shenzhen) Ltd.	Epson Iberica, S.A.U.
Epson (China) Co., Ltd.
communications	glasses, and others	Epson Precision (Philippines), Inc.
Epson Singapore Pte. Ltd.
			Epson Korea Co., Ltd.
			Epson Hong Kong Ltd.
			Epson Taiwan Technology &
			Trading Ltd.
			PT. Epson Indonesia
			Epson (Thailand) Co., Ltd.
			Epson Philippines Corporation
			Epson Australia Pty. Ltd.
			Epson India Pvt. Ltd.

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