Marubun : FY2023 1Q Earnings Reports

	Summary of Consolidated Financial Results for the Three Months Ended June 30, 2023
		July 31, 2023
Company Name :	MARUBUN CORPORATION
Listing :	Tokyo Stock Exchange
Securities Code :	7537
URL :	https://www.marubun.co.jp
Representative :	Toru Iino, CEO and Representative Director
Contact :	Toshihiro Shibuya, Officer, Director, Corporate Planning Dept.
TEL :	[phone]
Preparation of supplementary material :	Yes
Holding of investor meeting :	No

1. Consolidated Financial Results for the Three Months Ended June 30, 2023 (April 1,2023 - June 30,2023)

(1) Consolidated䚷Operating Results
		Net Sales		Operating Income	Ordinary Income		Profit Attributable
				to Owners of Parent
For the Three Months ended		Millions of Yen		Millions of Yen		Millions of Yen		Millions of Yen
June 30, 2023		60,414	30.9	3,131	54.6	(97)	-	(330)	-
June 30, 2022		46,156	23.6	2,024	88.1	(252)	-	(350)	-

(Note)
Comprehensive income	Three Months ended June 30, 2023				318	Millions of Yen	(40.9)%
	Three Months ended June 30, 2022				539	Millions of Yen	(55.8)%
	Earnings per Share	Earnings Per Share
	-Basic-			-Diluted-
For the Three Months ended			Yen			Yen
June 30, 2023	(12.65)			-
June 30, 2022	(13.42)			-
(2) Financial Position
	Total Assets		Total Net Assets		Equity Ratio
	Millions of Yen		Millions of Yen				%
As of June 30, 2023	175,675		51,825				26.4
As of March 31, 2023	175,998		53,084				27.1
(Reference)
Tangible net worth	As of June 30, 2023					46,291	Millions of Yen
	As of March 31, 2023					47,747	Millions of Yen
2. Dividends
					Dividend Per Share
	1st Quarter		2nd Quarter	3rd Quarter		Year-end	Annual
	Yen			Yen		Yen			Yen		Yen
Year ended March 31, 2023	-			20.00		-			60.00		80.00
Year ended March 31, 2024	-
Year ending March 31, 2024				25.00		-			25.00		50.00
(Forecast)
3. Consolidated Financial Forecasts for the Fiscal Year Ending March 31, 2024
	Net Sales		Operating Income		Ordinary Income	Profit Attributable	Earnings per Share
			to Owners of Parent	-Basic-
	Millions of Yen		Millions of Yen			Millions of Yen		Millions of Yen		Yen
Six Months ending	113,500		12.4		3,400	(35.5)			1,300	14.5	645	37.4	24.68
September 30, 2023
Year ending March 31, 2024	236,000		4.3		8,750	(20.4)			4,500	(36.8)	3,000	(42.3)	114.79

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. Summary of operating results for the fiscal year under review

• During the first quarter of the consolidated fiscal year under review (April 1 to June 30, 2023), the employment and income environment in Japan improved and consumer spending and capital investment rebounded as economic activity normalized with the downgrading of COVID-19 to Category 5 in severity classification and the removal of movement restrictions. However, the outlook for the Japanese economy remained uncertain, mainly reflecting the prolonged inflation, the effects of sharp foreign exchange rate changes, and concern over downside risks due to global monetary tightening.
• In the electronics sector, in which the Marubun Group (the "Group") operates, demand for servers increased with the development of generative AI and increasing amounts of data handled, although PC shipments declined. Demand for products for vehicles recovered, mainly reflecting a shift to EVs and electrification of cars. In the semiconductor market, polarization continued in terms of the product supply-demand balance. While the shortage of supply of automotive semiconductors was being eliminated, demand for semiconductors for PCs and smartphones remained sluggish. Adjustments of inventories of multi-purpose semiconductors were moderate.
• In this situation, consolidated net sales of the Group during the first quarter of the fiscal year under review increased 30.9 year on year, to 60,414 million yen, reflecting the increase in demand for semiconductor and electronic components for consumer equipment, industrial

equipment and automobiles. On the profit side, operating profit increased 54.6 year on year, to 3,131 million yen, attributable to the increase in sales. Because of the depreciation of the yen that continued from the beginning of the fiscal year, foreign exchange losses of 2,348 million yen were posted in non-operating expenses, reflecting settlement losses during the first quarter due to the repayment of borrowings in foreign currency and a loss on valuation of borrowings in foreign currency at the end of the first quarter. In addition, interest expenses increased 681 million yen year on year due to the higher US dollar interest rate. Consequently, an ordinary loss of 97 million yen was posted (compared to an ordinary loss of 252 million yen in the prior year). The loss attributable to owners of parent stood at 330 million yen (compared to a loss attributable to owners of parent of 350 million yen in the prior year).

• Operating results by business segment are as follows: Electronic Devices Business
• In the Electronic Devices Business, demand for semiconductors for consumer equipment grew significantly. Semiconductors for automobiles, particularly new products, increased. Semiconductor and electronic components for industrial equipment, particularly factory automation equipment, were firm. As a result, net sales increased 39.5% year on year, to 49,383

million yen. Segment profit increased 49.2	year on year, to 3,002 million yen, due to an
increase in sales.
Electronic Systems Business

• In the Electronic Systems Business, sales declined in the field of space and defense electronics. In the laser equipment field, demand for optical sensors and diode lasers increased. In the industrial equipment field, demand for industrial embedded computers and devices for analyzing and mounting electronic components increased. Consequently, net sales stood at 10,700 million yen, an increase of 2.6% from the same period of the previous year. Segment profit increased 92.8% year on year, to 253 million yen,due to an increase in sales and an improvement in the gross profit ratio..
  Electronic Solutions Business
• In the Electronic Solutions business, demand for communications modules and millimeter wave radar products was firm. Net sales rose 3.1% year on year, to 330 million yen. A segment loss of 122 million yen was posted (compared to a segment loss of 117 million yen in the same

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period of the previous fiscal year) due to an increase in selling, general and administrative expenses caused primarily by active marketing.

. Summary of consolidated financial conditions for the fiscal year under review

Assets

• Current assets at the end of the first quarter of the fiscal year under review stood at 165,470 million yen, a decrease of 672 million yen from the end of the previous fiscal year. This result was mainly attributable to decreases in cash and deposits of 4,141 million yen and in notes and accounts receivable - trade of 2,891 million yen, which more than offset increases in electronically recorded monetary claims - operating of 5,390 million yen and in Other in current assets. Non-current assets amounted to 10,205 million yen, an increase of 350 million yen from the end of the previous fiscal year. This was primarily due to a 344 million yen increase in investment securities.
• As a result, total assets decreased by 322 million yen from the end of the previous fiscal year, to 175,675 million yen.
  Liabilities
• Current liabilities at the end of the first quarter of the consolidated fiscal year under review came to 118,039 million yen, an increase of 950 million yen from the end of the previous fiscal year. This was attributable largely to an increase of 5,096 million yen in short-term borrowings and an increase in Other in current liabilities, more than offsetting decreases of 5,449 million yen in notes and accounts payable - trade and 988 million yen in income taxes payable. Non-current liabilities amounted to 5,810 million yen, a decrease of 14 million yen from the end of the previous fiscal year.
• As a result, total liabilities increased by 936 million yen from the end of the previous fiscal year, to 123,850 million yen.
  Net assets
• Net assets totaled 51,825 million yen at the end of the first quarter of the consolidated fiscal year under review, a decrease of 1,258 million yen from the end of the previous consolidated fiscal year. This was largely a result of a decrease of 1,898 million yen in retained earnings, partially offset by increases of 232 million yen in valuation difference on available-for-sale securities and 197 million yen in non-controlling interests.
• As a result, the equity ratio stood at 26.4% (compared to 27.1% at the end of the previous fiscal year).

. Future outlook

There has been no revision to the consolidated financial forecasts for the fiscal year ending March 31, 2024, which were announced on May 12, 2023.

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Consolidated Financial Statements

(1) Consolidated Balance Sheet

			(Millions of yen)
		As of March 31, 2023	As of June 30, 2023
Assets
Current assets
Cash and deposits	21,253	17,111
Notes and accounts receivable - trade	51,426	48,534
Electronically recorded monetary claims -	7,989	13,379
operating
Merchandise and finished goods	54,558	54,300
Work in process	79	175
Accounts receivable - other	28,914	28,718
Other	1,940	3,262
Allowance for doubtful accounts		17	12
Total current assets	166,143	165,470
Non-current assets
Property, plant and equipment
Buildings and structures	3,651	3,666
Accumulated depreciation	2,464	2,488
Buildings and structures, net		1,186	1,178
Machinery, equipment and vehicles		9	9
Accumulated depreciation		9	9
Machinery, equipment and vehicles, net	0	0
Tools, furniture and fixtures		2,253	2,281
Accumulated depreciation	1,770	1,805
Tools, furniture and fixtures, net		483	475
Land		1,411	1,411
Leased assets	34	34
Accumulated depreciation	17	19
Leased assets, net		16	15
Right of use assets		206	226
Accumulated depriciation		105	109
Right of use assets,net	100	116
Construction in progress		4	11
Total property, plant and equipment	3,203	3,208
Intangible assets		898	864
Investments and other assets
Investment securities	2,317	2,662
Deferred tax assets	505	368
Retirement benefit asset	232	244
Other	2,807	3,074
Allowance for doubtful accounts		109	216
Total investments and other assets	5,753	6,133
Total non-current assets		9,855	10,205
Total assets	175,998	175,675

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(1) Consolidated Balance Sheet

		(Millions of yen)
	As of March 31, 2023	As of June 30, 2023
Liabilities
Current liabilities
Notes and accounts payable - trade	28,005	22,556
Short-term borrowings	69,423	74,520
Current portion of long-term borrowings	25	12
Lease liabilities	72	80
Accounts payable - other	14,738	15,238
Income taxes payable	1,114	125
Provision for bonuses	1,020	569

Other

Total current liabilities

Non-current liabilities

Long-term borrowings

Lease liabilities

Retirement benefit liability

Provision for retirement benefits for directors (and other officers)

2,688	4,936
117,089	118,039
5,000	5,000
122	123
365	367
107	108

Asset retirement obligations	113	113
Other		116	97
Total non-current liabilities	5,824	5,810
Total liabilities		122,913	123,850
Net assets
Shareholders' equity
Share capital	6,214	6,214
Capital surplus	6,353	6,353
Retained earnings	34,388	32,489
Treasury shares	1,631	1,631
Total shareholders' equity		45,325	43,426
Accumulated other comprehensive income
Valuation difference on available-for-sale	821	1,054
securities
Deferred gains or losses on hedges	26	99
Foreign currency translation adjustment	1,684	1,752
Remeasurements of defined benefit plans	56	42
Total accumulated other comprehensive income		2,422	2,864
Non-controlling interests		5,336	5,534
Total net assets		53,084	51,825
Total liabilities and net assets		175,998	175,675

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