JCU : Summary of Financial Results for the Third Quarter of the Fiscal Year Ending March 31, 2023

February 3, 2023

Summary of Financial Results for the Third Quarter of the Fiscal Year Ending March 31, 2023

(Nine Months Ended December 31, 2022)

		[Japanese GAAP]
Company name: JCU CORPORATION	Listing: Tokyo Stock Exchange
Stock code:	4975	URL: https://www.jcu-i.com/
Representative:	Masashi Kimura, Chairman & CEO
Contact:	Yoji Inoue, Director, Managing Executive Officer, General Manager of Corporate Strategy Office
	Tel: [phone]

Scheduled date of filing of Quarterly Report:	February 8, 2023
Scheduled date of payment of dividend:	-
Preparation of supplementary materials for quarterly financial results:	Yes
Holding of quarterly financial results meeting:	None

Note: The original disclosure in Japanese was released on February 3, 2023 at 15:00 (GMT +9).

(All amounts are rounded down to the nearest million yen)

1. Consolidated Financial Results for the Nine Months Ended December 31, 2022 (April 1, 2022 - December 31, 2022)

(1) Consolidated results of operations				(Percentages represent year-over-year changes)
	Net sales		Operating profit	Ordinary profit	Profit attributable to
		owners of parent
	Million yen		%	Million yen	%	Million yen	%	Million yen	%
Nine months ended Dec. 31, 2022	20,702		16.0	7,320	10.5	7,398	9.7	5,154	11.5
Nine months ended Dec. 31, 2021	17,841		15.7	6,626	33.8	6,743	35.1	4,620	35.8

Note: Comprehensive income (million yen)

Nine months ended Dec. 31, 2022:	7,639 (up 29.3%)
Nine months ended Dec. 31, 2021:	5,908 (up 104.6%)

	Net income per share	Diluted net income
	per share
	Yen	Yen
Nine months ended Dec. 31, 2022	198.86	-
Nine months ended Dec. 31, 2021	176.47	-

(2) Consolidated financial position

		Total assets	Net assets	Equity ratio
		Million yen		Million yen	%
As of Dec. 31, 2022		44,516		38,586	86.7
As of Mar. 31, 2022		40,892		33,166	81.1
Reference: Shareholders' equity (million yen)	As of Dec. 31, 2022: 38,586	As of Mar. 31, 2022: 33,166

2. Dividends

			Dividends per share
	1Q-end	2Q-end	3Q-end		Year-end	Total
	Yen	Yen	Yen		Yen	Yen
FY3/22	-	27.00	-		30.00	57.00
FY3/23	-	33.00	-
FY3/23 (forecasts)					33.00	66.00

Note: Revisions to the most recently announced dividend forecast: None

3. Consolidated Forecast for the Fiscal Year Ending March 31, 2023 (April 1, 2022 - March 31, 2023)

(Percentages represent year-over-year changes)

	Net sales		Operating profit	Ordinary profit	Profit attributable to	Net income per share
		owners of parent
	Million yen		%	Million yen	%	Million yen	%	Million yen	%	Yen
Full year	26,500		9.3	9,100	1.2	9,100	(1.4)	6,300	(1.1)	243.46

Note: Revisions to the most recently announced consolidated forecast: None

* Notes

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

Newly added: -

Excluded: -

1. Application of special accounting methods for presenting quarterly consolidated financial statements: None
2. Changes in accounting policies and accounting estimates, and restatements

1)	Changes in accounting policies due to revisions in accounting standards, others: Yes
2)	Changes in accounting policies other than 1) above:	None
3)	Changes in accounting estimates:	None
4)	Restatements:	None

(4) Number of outstanding shares (common stock)

1)	Number of shares outstanding at the end of the period (including treasury shares)
	As of Dec. 31, 2022:	27,547,477 shares	As of Mar. 31, 2022:	27,541,754 shares
2)	Number of treasury shares at the end of the period
	As of Dec. 31, 2022:	1,794,629 shares	As of Mar. 31, 2022:	1,608,474 shares
3) Average number of shares outstanding during the period
	Nine months ended Dec. 31, 2022:	25,918,077 shares	Nine months ended Dec. 31, 2021:	26,184,509 shares

Note 1: The quarterly financial report is not subject to quarterly review by certified public accountants or auditing firms.

Note 2: Cautionary statement with respect to forward-looking statements and other special items

Forecasts of future performance in this report are based on assumptions judged to be valid and information currently available to the Company. Actual results may differ substantially from these forecasts for a number of reasons.

	JCU CORPORATION (4975) Financial Results for the Third Quarter of FY3/23
Contents of Attachments
1. Qualitative Information on Quarterly Consolidated Financial Performance	2
(1)	Explanation of Results of Operations	2
(2)	Explanation of Financial Position	3
(3)	Explanation of Consolidated Forecast and Other Forward -looking Statements	4
2. Quarterly Consolidated Financial Statements and Notes	5
(1)	Quarterly Consolidated Balance Sheet	5
(2)	Quarterly Consolidated Statements of Income and Comprehensive Income	7
(3)	Notes to Quarterly Consolidated Financial Statements	9
	Going Concern Assumption	9
	Significant Changes in Shareholders' Equity	9
	Changes in Accounting Policies	9
	Segment Information	9
	Material Subsequent Events	11

1

JCU CORPORATION (4975) Financial Results for the Third Quarter of FY3/23

1. Qualitative Information on Quarterly Consolidated Financial Performance

(1) Explanation of Results of Operations

During the first nine months of the fiscal year ending March 31, 2023 (hereinafter the "period under review"), the domestic economy saw a recovery of consumer spending mainly in the service sector as a result of the decrease in COVID-19 cases. With a recovery in export, the manufacturing industry continued to show a modest recovery trend as seen, for example, in the resumption of capital investments that had been postponed.

Overseas, in China, consumer spending recovered and production in the manufacturing industry increased because strict activity restrictions were relaxed in early June. However, as activity restrictions were reimposed in August, consumer spending stagnated, and production in the manufacturing industry declined. In Europe and the United States, not only the recovery of service spending following the relaxation of activity restrictions subsided, but also there have been impacts of soaring energy and resource prices, which needs close monitoring on an ongoing basis.

As for the business environment surrounding the JCU Group, although the shipments of smartphones and PCs decreased, with the 5G commercialization, IoT, and teleworking as keywords, the technological innovation and increased volume of data communications resulted in steady demand mainly for semiconductor package substrates for 5G related components, infrastructure such as data centers, and high -performance electronic devices. In the automotive industry, we saw an increase in automobile production mainly in China, where recovery in production started as strict activity restrictions were relaxed in early June.

The results of operations of the JCU Group were as follows.

(Millions of yen, unless otherwise stated)

		Previous period		Current period		Year-over-year
		(Apr. 1, 2021 - Dec. 31, 2021)	(Apr. 1, 2022 - Dec. 31, 2022)		% change
Net sales		17,841		20,702		Up 16.0%
Operating profit	6,626		7,320		Up 10.5%
Ordinary profit	6,743		7,398		Up 9.7%
Profit attributable to owners of parent	4,620		5,154		Up 11.5%
The results of operations by segment were as follows.
Chemicals Business
Chemicals for electronics industry
China:	While demand for PWBs for other high-performance	electronic devices subsided after having
	increased with IoT and teleworking as keywords, demand for chemicals increased thanks to the
	production of PWBs for smartphones staying relatively strong.
Taiwan:	Demand for semiconductor package substrates for high-performance electronic devices and servers
	remained strong, and demand for chemicals increased significantly.
Korea:	As a result of demand for the semiconductor market being slacked, demand for chemicals stayed
	flat because some manufactures of semiconductor package substrates continued reducing
	inventories.
Chemicals for decoration
Japan:	The shortage of semiconductors and parts was alleviated, resulting in increases in automobile
	production and demand for chemicals.
China:	Recovery in production started as strict activity restrictions were relaxed in early June, resulting in
	an increase in automobile production. However, demand for chemicals stayed flat.
				(Millions of yen, unless otherwise stated)
		Previous period		Current period		Year-over-year
		(Apr. 1, 2021 - Dec. 31, 2021)	(Apr. 1, 2022 - Dec. 31, 2022)		% change
Net sales		16,972		18,684		Up 10.1%
Segment profit		7,372		7,718		Up 4.7%

2

JCU CORPORATION (4975) Financial Results for the Third Quarter of FY3/23

Machine Business

Net sales, orders received, and order backlog all increased substantially thanks to the resumption of the projects that had been postponed due to the pandemic and an increase in demand for new investments in plating machines for the electronics industry.

(Millions of yen, unless otherwise stated)

	Previous period	Current period	Year-over-year
	(Apr. 1, 2021 - Dec. 31, 2021)	(Apr. 1, 2022 - Dec. 31, 2022)	% change
Net sales	868	2,018	Up 132.3%
Segment profit (loss)	(69)	318	-
Orders received	2,048	3,748	Up 83.0%
Order backlog	1,355	3,846	Up 183.7%

Other businesses

The Other businesses posted sales of 0 million yen (down 28.4% year over year) with a segment loss of 12 million yen (as compared with a segment loss of 12 million yen a year earlier).

1. Explanation of Financial Position 1) Assets, liabilities and net assets Assets

Total assets at the end of the period under review increased 3,623 million yen (up 8.9%) from the end of the previous fiscal year to 44,516 million yen.

Current assets increased 3,629 million yen (up 11.2%) to 36,136 million yen mainly due to an increase in cash and deposits, as well as increases in notes receivable-trade, accounts receivable-trade, and contract assets.

Non-current assets decreased 5 million yen (down 0.1%) to 8,379 million yen mainly due to decreases in investment securities and deferred tax assets, which were partially offset by an increase in property, plant and equipment.

Liabilities

Total liabilities at the end of the period under review decreased 1,796 million yen (down 23.3%) from the end of the previous fiscal year to 5,929 million yen.

Current liabilities decreased 1,616 million yen (down 24.1%) to 5,095 million yen. This was mainly due to a decrease in notes and accounts payable-trade and also a decrease in income taxes payable as a result of the payment of income taxes.

Non-current liabilities decreased 180 million yen (down 17.8%) to 833 million yen mainly due to a decrease in long-term borrowings.

Net assets

Total net assets at the end of the period under review increased 5,420 million yen (up 16.3%) from the end of the previous fiscal year to 38,586 million yen. This was due to an increase in foreign currency translation adjustment and also an increase in retained earnings from profit attributable to owners of parent, which were partially offset by a decrease in retained earnings as a result of payment of cash dividends and an increase in treasury shares resulting from the share buyback.

3