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Financial Accounting Standards Foundation Member

Note: This document has been translated from 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.

May 13, 2022

Consolidated Financial Results

for the Fiscal Year Ended March 31, 2022

(Under Japanese GAAP)

Company name:

ESPEC CORP.

Listing

Tokyo Stock Exchanges, Prime Market

Securities code:

6859

URL:

https://www.espec.co.jp

Representative:

Satoshi Arata, Representative Director and President

Inquiries:

Keiji Oshima, Chief Officer of Corporate Control Headquarters

Telephone:

+81-6-6358-4741

Scheduled date of annual general meeting of shareholders:

Scheduled date to commence dividend payments:

Scheduled date to file annual securities report:

Preparation of supplementary material on financial results:

Holding of financial results briefing:

(Yen amounts are rounded down to millions, unless otherwise noted.)

1. Consolidated financial results for the fiscal year ended March 31, 2022 (from April 1, 2021 to March 31, 2022)

(1) Consolidated operating results

(Percentages indicate year-on-year changes.)

Net sales

Operating profit

Ordinary profit

Profit attributable to

owners of parent

Fiscal year ended

Millions of yen

%

Millions of yen

%

Millions of yen

%

Millions of yen

%

March 31, 2022

41,852

8.2

1,968

(23.5)

2,322

(18.2)

1,905

(2.8)

March 31, 2021

38,668

(8.9)

2,572

(31.3)

2,840

(27.8)

1,961

(30.4)

Note: Comprehensive income

For the fiscal year ended March 31, 2022

¥ 2,820 million (13.8) %

For the fiscal year ended March 31, 2021

¥ 3,271 million 48.8 %

Basic earnings

Diluted earnings

Return on equity

Ratio of ordinary

Ratio of operating

per share

per share

profit to total assets

profit to net sales

Fiscal year ended

Yen

Yen

%

%

%

March 31, 2022

84.89

－

4.2

3.9

4.7

March 31, 2021

85.79

－

4.5

4.9

6.7

Reference: Share of profit (loss) of entities accounted for using equity method

For the fiscal year ended March 31, 2022

¥ - million

For the fiscal year ended March 31, 2021

¥ - million

Note: The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020) from

the beginning of the fiscal year ended March 31, 2022, and the figures for the fiscal year ended March 31, 2022 are shown after the application of this accounting standard.

(2) Consolidated financial position

Total assets

Net assets

Equity-to-asset ratio

Net assets per share

As of

Millions of yen

Millions of yen

%

Yen

March 31, 2022

61,922

45,592

73.3

2,028.44

March 31, 2021

58,607

44,984

76.8

1,967.34

Reference: Equity

As of March 31, 2022

¥45,378 million

As of March 31, 2021

¥44,984 million

(3) Consolidated cash flows

Cash flows from

Cash flows from

Cash flows from

Cash and cash equivalents

operating activities

investing activities

financing activities

at end of period

Fiscal year ended

Millions of yen

Millions of yen

Millions of yen

Millions of yen

March 31, 2022

2,018

(932)

(2,830)

16,157

March 31, 2021

3,041

(2,034)

(1,503)

17,301

2. Cash dividends

Annual dividends per share

Ratio of

Total cash

Payout ratio

dividends to

First

Second

Third

Fiscal

Total

dividends (Total)

(Consolidated)

net assets

quarter-end

quarter-end

quarter-end

year-end

(Consolidated)

Yen

Yen

Yen

Yen

Yen

Millions of yen

%

%

Fiscal year ended

－

10.00

－

41.00

51.00

1,175

59.4

2.7

March 31, 2021

Fiscal year ended

－

18.00

－

42.00

60.00

1,352

70.7

3.0

March 31, 2022

Fiscal year ending

March 31, 2023

－

24.00

－

45.00

69.00

42.9

(Forecast)

Note: Components of the interim dividend for the fiscal year ending March 31, 2023 (forecast)

Ordinary dividend ¥22 Commemorative dividend ¥2

Components of the year-end dividend for the fiscal year ending March 31, 2023 (forecast)

Ordinary dividend ¥43 Commemorative dividend ¥2

3. Forecasts of consolidated operating results for fiscal 2022, ending March 31, 2023 (From April 1, 2022 to March 31, 2023) (Percentages indicate year-on-year changes.)

Net sales

Operating profit

Ordinary profit

Profit attributable to

Basic earnings

owners of parent

per share

Millions of

%

Millions of

%

Millions of

%

Millions of

%

Yen

yen

yen

yen

yen

Six months ending

23,500

33.8

1,950

392.2

2,000

321.2

1,300

463.7

58.11

September 30, 2022

Fiscal year ending

50,000

19.5

5,000

153.9

5,100

119.6

3,600

88.9

160.92

March 31, 2023

* Notes

  1. Changes in significant subsidiaries during the period
    (changes in specified subsidiaries resulting in the change in scope of consolidation): None

Newly included: (Company name:

)

Excluded: (Company name: )

  1. Changes in accounting policies, changes in accounting estimates, and restatement
  1. Changes in accounting policies due to revisions to accounting standards and other regulations: Yes
  2. Changes in accounting policies due to other reasons: None
  3. Changes in accounting estimates: None
  4. Restatement: None
  1. Number of issued shares (common shares)
  1. Total number of issued shares at the end of the period (including treasury shares)

As of March 31, 2022

23,781,394 shares

As of March 31, 2021

23,781,394 shares

2)

Number of treasury shares at the end of the period

As of March 31, 2022

1,410,246 shares

As of March 31, 2021

915,593 shares

3)

Average number of shares outstanding during the period

Fiscal year ended March 31, 2022

22,453,148 shares

Fiscal year ended March 31, 2021

22,865,944 shares

Reference: Overview of non-consolidated financial results

1. Non-consolidated financial results for the fiscal year ended March 31, 2022 (from April 1, 2021 to March 31, 2022)

  1. Non-consolidatedoperating results

(Percentages indicate year-on-year changes.)

Net sales

Operating profit

Ordinary profit

Profit

Fiscal year ended

Millions of yen

%

Millions of yen

%

Millions of yen

%

Millions of yen

%

March 31, 2022

26,307

1.6

1,027

(30.3)

1,590

(12.1)

1,563

16.3

March 31, 2021

25,887

(13.2)

1,473

(42.9)

1,808

(38.8)

1,345

(38.0)

Basic earnings

Diluted earnings

per share

per share

Fiscal year ended

Yen

Yen

March 31, 2022

69.65

－

March 31, 2021

58.82

－

(2) Non-consolidated financial position

Total assets

Net assets

Equity-to-asset ratio

Net assets per share

As of

Millions of yen

Millions of yen

%

Yen

March 31, 2022

47,035

37,952

80.7

1,696.48

March 31, 2021

47,643

39,200

82.3

1,714.37

Reference: Equity

As of March 31, 2022

¥37,952 million

As of March 31, 2021

¥39,200 million

  • Financial results reports are exempt from audit conducted by certified public accountants or an audit corporation.
  • Proper use of earnings forecasts, and other special matters
    Statements concerning the future such as the results forecasts, etc., included in this document are based on currently available information and certain assumptions judged reasonable and actual results, etc., may differ due to various factors.
    Note: For details, see "Outlook for Fiscal 2022" on p. 4.

Index of Attached Material

1. Summary of Business Results ----------------------------------------------------------------------------------------------------------------------------

2

(1) Overview of Fiscal 2021 Operating Results ----------------------------------------------------------------------------------------------------------

2

(2)

Overview of Fiscal 2021 Consolidated Financial Situation -----------------------------------------------------------------------------------------

3

(3)

Overview of Fiscal 2021 Cash Flows ------------------------------------------------------------------------------------------------------------------

3

(4)

Outlook for Fiscal 2022 ----------------------------------------------------------------------------------------------------------------------------------

4

(5)

Basic Policy on Profit Distributions and Dividends for Fiscal 2021 and Fiscal 2022 -----------------------------------------------------------

4

2. Basic Stance on the Selection of Accounting Standards ---------------------------------------------------------------------------------

4

3. Consolidated Financial Statements ------------------------------------------------------------------------------------------------------------

5

(1) Consolidated Balance Sheets ------------------------------------------------------------------------------------------------------------------

5

(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income -------------------------------

7

Consolidated Statements of Income ----------------------------------------------------------------------------------------------------------

7

Consolidated Statements of Comprehensive Income ------------------------------------------------------------------------------------------------

8

(3)

Consolidated Statements of Changes in Net Assets ------------------------------------------------------------------------------------------------

9

(4)

Consolidated Statements of Cash Flows -------------------------------------------------------------------------------------------------------------

11

(5)

Notes to the Consolidated Financial Statements ----------------------------------------------------------------------------------------------------

12

Notes on the assumption of a going concern --------------------------------------------------------------------------------------------------------

12

Important Matters Concerning the Basis for Preparing Consolidated Financial Statements --------------------------------------------------

12

Changes in accounting policies -----------------------------------------------------------------------------------------------------------------------

15

Additional Information ---------------------------------------------------------------------------------------------------------------------------------

15

Segment Information and Others ---------------------------------------------------------------------------------------------------------------------

16

Per-Share Information ----------------------------------------------------------------------------------------------------------------------------------

19

Business Combinations --------------------------------------------------------------------------------------------------------------------------------

20

Material Subsequent Events ---------------------------------------------------------------------------------------------------------------------------

20

- 1 -

1. Summary of Business Results

Forward-looking statements contained herein are based on the Group's judgment as of March 31, 2022. The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020) from the beginning of the fiscal year ended March 31, 2022, and the figures for the fiscal year ended March 31, 2022 are shown after the application of this accounting standard.

  1. Overview of Fiscal 2021 Operating Results
  1. Operating Results for Fiscal 2021

During fiscal 2021, the year ended March 31, 2022, the ESPEC Group's business environment remained on a recovery track due to the normalization of the global economy and the spread of COVID-19 vaccinations. With the advance of digitalization and decarbonization in society, electronics-related investment was favorable, and automotive-related investment was also firm. However, concerns have emerged about the global economic impacts of surging high raw material prices and logistics costs and ongoing shortages of semiconductors and electronics components, as well as a deterioration in the situation in Ukraine and lockdowns in China in the fourth quarter.

In this environment, the ESPEC Group saw an increase in activity centered on markets related to 5G and IoT, as well as automated driving and electrification of automobiles, resulting in a 36.5% increase in orders received, with reached a new record high of ¥51,303 million. However, on the manufacturing front, the shortage of electronics components was not resolved, and although the Group took countermeasures such as procuring alternatives and making design changes, product delivery times continued to lengthen. As a result, net sales were held to an increase of only 8.2% year on year to ¥41,852 million. On the profit front, operating profit decreased 23.5% year on year to ¥1,968 million due to a deterioration in the cost-of-sales ratio driven by increased procurement costs and increased personal expenses and activity expenses associated with the expansion in orders. Profit attributable to owners of parent decreased only 2.8% year on year to ¥1,905 million, mainly due to a gain on sale of investment securities.

Year Ended March 31, 2021

Year Ended March 31, 2022

Change (%)

(Millions of yen)

(Millions of yen)

Orders received

37,580

51,303

36.5

Net sales

38,668

41,852

8.2

Operating profit

2,572

1,968

(23.5)

Ordinary profit

2,840

2,322

(18.2)

Profit attributable to

1,961

1,905

(2.8)

owners of parent

  1. Performance by Segment
    Consolidated results by operating segment for fiscal 2021

Orders received

Net sales

Operating profit (loss)

(Millions of yen)

(Millions of yen)

(Millions of yen)

Equipment Business

43,535

34,518

1,370

Service Business

6,771

6,407

618

Other Business

1,265

1,188

(23)

Elimination

(269)

(261)

2

Total

51,303

41,852

1,968

Equipment Business

In the environmental test chambers field, particularly the Japanese market, orders-received increased year on year both for versatile standardized products and customized products, while net sales were level year on year. In overseas markets, orders received were brisk, and net sales increased in China, North America, Europe, South Korea, and Southeast Asia.

In the energy devices equipment field, both orders received and net sales increased year on year and orders were acquired for evaluation systems for secondary batteries due to recovery in automotive-related investment.

In the semiconductor equipment field, orders-received increased year on year while investment related to memory and automobiles continued, but net sales decreased.

As a result, the Equipment Business on the whole saw orders received increase 41.6% to ¥43,535 million and net sales increase 12.6% to ¥34,518 million, compared to the last year. On the profit front, operating profit decreased 33.5% year on year to ¥1,370 million, due to a deterioration in the cost-of-sales ratio and an increase in selling, general and administrative expenses.

Year Ended March 31, 2021

Year Ended March 31, 2022

Change (%)

(Millions of yen)

(Millions of yen)

Orders received

30,755

43,535

41.6

Net sales

30,669

34,518

12.6

Operating profit

2,062

1,370

(33.5)

- 2 -

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Espec Corporation published this content on 30 May 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 May 2022 13:28:10 UTC.