Toshiba Tec : Statement of Accounts (2023.6)

2. Dividends

3. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2024 (April 1, 2023 to March 31, 2024)

(% indicates changes from the previous corresponding period.)

(Note) For details, please refer to "2. Quarterly Consolidated Financial Statements and Notes (3) Notes to the quarterly consolidated financial statements (Accounting policies adopted specially for the preparation of quarterly consolidated financial statements)" on page 9 of this report.

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):

• Quarterly financial results reports are exempt from quarterly review conducted by certified public accountants or an audit corporation.
• Proper use of earnings forecasts, and other special matters (Explanation for the proper use of earnings forecasts)
  Financial results forecasts are based on information currently available to the Company and certain assumptions deemed reasonable and are not intended to be the Company's guarantee that they will be achieved. Actual results may significantly vary due to a variety of factors. For the assumptions used as the basis for the earnings forecasts and precautions regarding the use of the earnings forecasts, please refer to "1. Qualitative information on the financial results for the period under review (3) Consolidated financial results forecast and other forward-looking information" on page 4 of this report.

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1. Qualitative information on the financial results for the period under review

(1) Operating results

The world economy during the three months ended June 30, 2023 picked up moderately overall, as the normalization of economic activities progressed after the COVID-19 pandemic receded. However, the outlook still remained uncertain due mainly to price rises, ongoing monetary tightening overseas, and the Russian- Ukrainian problem.

Amid such conditions, Toshiba Tec Corporation (the "Company") and its subsidiaries (collectively, the "Group") have been pursuing the Basic Policy of the FY23-25Mid-term Business Plan, "To become a global top solutions partner by generating new value through co-creation with the aim of contributing to the resolution of social issues." Under the basic policy, the Group has focused its energy on carrying out various measures toward sustainable growth. At the same time, the Group has strived to contribute to the resolution of social issues by executing business transformation and corporate transformation.

In the three months ended June 30, 2023, net sales were ¥122,374 million (up 12% year on year) due mainly to increased sales of POS systems for the domestic market and multifunction peripherals (MFPs), and the impact of foreign exchange rates. On the profit front, profitability of MFPs improved, resulting in operating profit of ¥1,287 million (up ¥1,084 million year on year), ordinary profit of ¥406 million (ordinary loss of ¥2,253 million in the same period of the previous fiscal year), and profit attributable to owners of parent of ¥38 million (loss attributable to owners of parent of ¥2,161 million in the same period of the previous fiscal year).

Results of reportable segments for the three months ended June 30, 2023 were as follows.

Retail Solutions Business Group

The Retail Solutions Business Group handles POS systems for domestic and overseas markets, auto ID systems for domestic market, and related products. Amid a severe business environment in which intensifying competition with peers continues, the business group has worked on expanding its solution business through the global retail platform "ELERA" and strategic partnership, boosting recurring revenue business, and investing in retail innovation to expand new businesses (strengthening digital human resources, ELERA Evolution, enhancing co-creation opportunities, and strengthening partner collaboration).

Sales of POS systems for the domestic market increased due to efforts to expand sales mainly of self- checkout systems, payment terminals, and smart receipts, as well as efforts to revise selling prices, despite continued harsh conditions reflecting soaring raw material prices, rising prices, and other factors.

Sales of POS systems for overseas markets increased due to the impact of foreign exchange rates, an increase in sales in the Americas, and other factors.

Sales of auto ID systems for the domestic market decreased, primarily because sales of mid-range and high-end barcode printers declined, offsetting the overall growth in the number of units sold thanks to strong sales of entry models and mobile printers to specific customers.

As a result, net sales of the Retail Solutions Business Group were ¥69,124 million (up 9% year on year). The business group recorded operating loss of ¥828 million (operating profit of ¥72 million in the same period of the previous fiscal year) due to deterioration in profit and loss of the POS systems for the domestic market caused by the impact of foreign exchange rates and a deterioration in profit and loss of POS systems for the overseas market.

Workplace Solutions Business Group

The Workplace Solutions Business Group handles multifunction peripherals (MFPs) for domestic and overseas markets, auto ID systems for overseas markets, inkjet heads for domestic and overseas markets, and related products. Amid a severe business environment in which the declining printing volume due to post-COVID-19 work style reforms and office DX promotion and intensifying competition with peers continue, the business group focused on increasing basic earnings power of core business. At the same time,

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the business group worked on developing the auto ID business, document and data solutions, and customer support business in order to expand business in growth areas.

Sales of MFPs increased due to the impact of foreign exchange rates in addition to increased sales in the Americas, Europe, and other regions as a result of focusing on raising selling prices, supplying high- performance models, and other efforts.

Sales of auto ID systems for overseas markets declined as a result of decreased sales in the Americas, Europe, Asia, and other overseas regions.

Sales of inkjet heads decreased due mainly to decreased sales to overseas customers.

As a result, net sales in the Workplace Solutions Business Group were ¥54,475 million (up 16% year on year). Operating profit for the business group soared to ¥2,115 million (up ¥1,984 million year on year) due to the increase in net sales resulting from recovery from product supply disruptions, the increased selling prices and other factors and effects of structural reform and structural transformation implemented so far, etc.

(Note) An auto ID system is a system that uses hardware and software devices to recognize and manage data content by automatically scanning barcode and RFID tag data.

(2) Financial condition

Assets at the end of the first quarter of the fiscal year ending March 31, 2024 increased by ¥6,089 million from the end of the previous fiscal year to ¥316,781 million. This was mainly because merchandise and finished goods, group deposits paid, and "Other" in current assets increased by ¥7,748 million, ¥5,093 million, and ¥2,204 million, respectively, and property, plant and equipment in non-current assets and "Other" in investments and other assets increased by ¥861 million and ¥1,817 million, respectively, although cash and deposits, and notes and accounts receivable - trade, and contract assets in current assets declined by ¥8,038 million and ¥3,801 million, respectively.

Liabilities increased by ¥4,615 million from the end of the previous fiscal year to ¥213,101 million. This was mainly because notes and accounts payable - trade and "Other" in current liabilities and retirement benefit liability in non-current liabilities increased by ¥1,950 million, ¥2,152 million, and ¥202 million, respectively.

Net assets increased by ¥1,473 million from the end of the previous fiscal year to ¥103,679 million. This was primarily due to an increase in foreign currency translation adjustment of ¥2,373 million, and an increase in retained earnings owing to the recording of profit attributable to owners of parent of ¥38 million, although retained earnings decreased owing to the payment of dividends of ¥1,106 million.

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