A&D : Consolidated Financial Results for the Nine Months Ended December 31, 2021

About this update from A&d Holon Holdings Company. Limited

Consolidated Financial Results for the Nine Months Ended December 31, 2021 [Japanese GAAP] February 8, 2022 Company name: A&D Company, Ltd. Stock exchange listing: Tokyo Stock Exchange Code number: 7745 URL: https://www.aandd.jp/ Representative: Yasunobu Morishima, President & CEO Contact: Sadao Ito, Director, Managing Executive Officer in charge of Business Management HQ Phone: +81-48-593-1111 Scheduled date of filing quarterly securities report: February 14, 2022 Scheduled date of commencing dividend payments: - Availability of supplementary briefing material on quarterly financial results: Available Schedule of quarterly financial results briefing session: Not scheduled (Amounts of less than one million yen are truncated.) 1. Consolidated Financial Results for the Nine Months Ended December 31, 2021 (April 1, 2021 to December 31, 2021) (1) Consolidated Operating Results (% indicates changes from the previous corresponding period.) Net profit Net sales Operating profit Ordinary profit attributable to parent company shareholders Million yen % Million yen % Million yen % Million yen % Nine months ended December 31, 2021 37,325 6.9 3,568 17.0 3,685 18.2 2,160 (2.7) December 31, 2020 34,904 (0.3) 3,050 57.6 3,117 70.8 2,220 403.9 Note: Comprehensive income Nine months ended December 31, 2021: ¥2,895 million [15.4%] Nine months ended December 31, 2020: ¥2,509 million [208.7%] Basic earnings per Diluted earnings per share share Yen Yen Nine months ended December 31, 2021 104.55 104.38 December 31, 2020 107.64 107.40 (2) Consolidated Financial Position Total assets Net assets Equity ratio Million yen Million yen % As of December 31, 2021 57,199 25,442 39.6 As of March 31, 2021 54,119 23,387 38.4 Reference: Equity As of December 31, 2021: ¥22,654 million As of March 31, 2021: ¥20,772 million Note: The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020), etc. effective from the beginning of the first quarter of the fiscal year. The figures as of December 31, 2021 represent those after the application of the accounting standard, etc. 2. Dividends Annual dividends 1st 2nd 3rd Year-end Total quarter-endquarter-endquarter-end Yen Yen Yen Yen Yen Fiscal year ended March 31, 2021 - 10.00 - 15.00 25.00 Fiscal year ending March 31, 2022 - 10.00 - Fiscal year ending March 31, 2022 (Forecast) 15.00 25.00 Note: Revision to the forecast for dividends announced most recently: No 3. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2022 (April 1, 2021 to March 31, 2022) (% indicates changes from the previous corresponding period.) Net profit Basic earnings per Net sales Operating profit Ordinary profit attributable to parent company share shareholders Million yen % Million yen % Million yen % Million yen % Yen Full year 51,500 6.4 5,360 21.7 5,410 18.5 3,430 2.7 166.06 Note: Revision to the financial results forecast announced most recently: No * Notes: Changes in significant subsidiaries during the period: No (Changes in specified subsidiaries accompanying changes to the scope of consolidation) New: - companies (Company name) -; Excluded: - companies (Company name) - Accounting policies adopted specially for the preparation of quarterly consolidated financial statements: Yes Changes in accounting policies, changes in accounting estimates and retrospective restatement Changes in accounting policies due to the revision of accounting standards: Yes Changes in accounting policies other than 1) above: No Changes in accounting estimates: No Retrospective restatement: No Note: For details, please refer to "2. Quarterly Consolidated Financial Statements and Primary Notes, (3) Notes to Quarterly Consolidated Financial Statements, (Changes in accounting policies)" on page 11 of the Appendix. Total number of issued shares (common stock) Total number of issued shares at the end of the period (including treasury stock): December 31, 2021: 22,601,400 shares March 31, 2021: 22,579,700 shares Total number of treasury stock at the end of the period: Decembe r 31, 2021: 1,919,070 shares March 31, 2021: 1,951,470 sha res 3) Average number of shares during the period: Nine months ended December 31, 2021: 20,664,428 shares Nine months ended December 31, 2020: 20,628,334 shares Note: The total number of treasury stock at the end ofthe period and the total number of treasury stock which has been eliminated when calculating the average number of shares during the period include the Company's shares held by Custody Bank of Japan, Ltd. (Trust E Account) as trust properties of the stock benefit trust system. These consolidated financial results are outside the scope of quarterly review by certified public accountants or audit corporations. Explanation of the proper use of financial results forecasts and other notes Forward-looking statements in this document, including financial results forecasts, are based on information available and certain assumptions deemed reasonable by the Company at present, and the Company does not guarantee their achievement. Actual business results, etc., may differ significantly due to various factors. Table of Contents 1. Qualitative Information on Quarterly Financial Results for the Period......................................................................... 5 (1) Business Results................................................................................................................................................... 5 (2) Financial Position ................................................................................................................................................. 6 (3) Consolidated Financial Results Forecast and Other Forward-looking Information ............................................. 6 2. Quarterly Consolidated Financial Statements and Primary Notes................................................................................ 7 (1) Quarterly Consolidated Balance Sheets................................................................................................................ 7 (2) Quarterly Consolidated Statements of Income and Comprehensive Income........................................................ 9 Quarterly Consolidated Statements of Income Nine Months Ended December 31 ................................................................................................................... 9 Quarterly Consolidated Statements of Comprehensive Income Nine Months Ended December 31 ................................................................................................................. 10 (3) Notes to Quarterly Consolidated Financial Statements....................................................................................... 11 (Notes on going concern assumption)................................................................................................................ 11 (Notes in the case of significant changes in shareholders' equity) .................................................................... 11 (Changes in accounting policies) ....................................................................................................................... 11 (Accounting policies adopted specially for the preparation of quarterly consolidated financial statements) .... 12 (Additional information).................................................................................................................................... 12 (Segment information, etc.) ............................................................................................................................... 17 4 1. Qualitative Information on Quarterly Financial Results for the Period (1) Business Results Looking back at the economic environment surrounding A&D Company, Ltd. (the "Company") and its subsidiaries (collectively, the "Group") during the nine months ended December 31, 2021, the severe situation caused by the COVID-19 pandemic gradually eased in Japan. As more people were vaccinated, corporate and economic activity gradually returned and positive developments emerged in the manufacturing sector, including capital investment moves. However, the situation remains uncertain due to the emergence of the omicron variant of the new coronavirus. Overseas, signs of recovery are seen in economic activity in the U.S., European countries and China, but the economic environment remains uncertain due to such factors as supply chain disruptions, spikes in material prices, shipping delays caused by a shortage of containers, and soaring transportation costs, aggravated by the risk that the omicron variant may cause a renewed spread of the pandemic. Amid such circumstances, the Group focused on online marketing activities while working remotely and holding meetings online to prevent the spread of infection. As we expected increases in component and material prices and higher transportation costs, we worked to reduce production costs and made efforts to control fixed costs. As a result, net sales for the nine months ended December 31, 2021 were ¥37,325 million (up 6.9% year-on- year), operating profit was ¥3,568 million (up 17.0% year-on-year), ordinary profit was ¥3,685 million (up 18.2% year-on-year), and net profit attributable to parent company shareholders was ¥ 2,160 million (down 2.7% year- on- year). The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020), etc. effective from the beginning of the first quarter of the fiscal year. For details of the impact of this application on the financial position and business results, please refer to "2. Quarterly Consolidated Financial Statements and Primary Notes, (3) Notes to Quarterly Consolidated Financial Statements, (Changes in accounting policies) as well as (Segment information, etc.), [Segment information], 2. Disclosure of changes, etc. in reportable segments." Business results by segment are as follows. 1) Measurement and Weighing Instruments Business In Japan, orders recovered from the year-earlier level as economic activity was beginning to return for the measurement and control simulation systems (DSP systems) business, but sales decreased. On the other hand, sales significantly increased for weighing instruments and equipment related to semiconductor production as capital expenditure-driven demand recovered and gained momentum. This, coupled with efforts to reduce costs, helped profit increase significantly from the year-earlier level. In the Americas, orders returned for the measurement and control simulation systems (DSP systems) business, as they did in Japan, but the impact of this on sales in this business was delayed due to such factors as a slow supply of materials, resulting in sales staying largely flat from the year-earlier level. Still, sales increased, and profit doubled for the region as core weighing instruments grew, driven by a recovery in demand and new market entries, and as metal detectors and checkweighers grew. In Europe, profit remained largely flat from a year earlier as expenses increased due to soaring transportation costs, but sales grew due to an effort to strengthen sales networks for weighing instruments. In Asia and Oceania, both sales and profits grew, driven by a significant increase in weighing instruments sales in South Korea, strong sales of weighing instruments for the jewelry market in India, and strong sales in Australia of metal detectors and checkweighers as well as a growth in sales of weighing instruments. As a result, net sales in the measurement and weighing instruments business were ¥21,232 million (up 11.5% year-on-year) and operating profit was ¥1,898 million (up 108.9% year-on-year). 2) Medical and Healthcare Business Orders increased significantly for the medical and healthcare business as demand for blood pressure monitors remained high, but sales rose only slightly from a year earlier as production and shipment were restricted due to 5

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