Consolidated Financial Results for the Fiscal Year Ended March 31, 2025 (Under IFRS)

May 15, 2025

Company name: Bando Chemical Industries, Ltd. Listing: Tokyo Stock Exchange Securities code: 5195

URL: https://www.bandogrp.com

Representative: Tomio Ueno, President and Representative Director

Inquiries: Kazuyuki Hayashi, Executive Officer and General Manager of Finance and Accounting Department

Telephone: +81-78-304-2516

Scheduled date of annual general meeting of shareholders: June 24, 2025 Scheduled date to commence dividend payments: June 25, 2025

Scheduled date to file annual securities report: June 23, 2025 Preparation of supplementary material on financial results: Yes

Holding of financial results briefing: Yes (for institutional investors and analysts)

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

1. Consolidated financial results for the Fiscal year ended March 31, 2025 (from April 1, 2024 to March 31, 2025)
   1. Consolidated operating results (Percentages indicate year-on-year changes.)

      	Revenue		Core operating profit		Operating profit		Profit before tax
      Fiscal year ended March 31, 2025 March 31, 2024	Millions of yen 115,593 108,278	% 6.8 4.5	Millions of yen 7,743 7,584	% 2.1 12.6	Millions of yen 3,480 7,772	% (55.2) (5.9)	Millions of yen 3,472 8,676	% (60.0) 1.6

      Note: Core operating profit is calculated as revenue subtracted by cost of sales and selling, general, and administrative expenses.

      	Profit attributable to owners of parent		Total comprehensive income		Basic earnings per share	Diluted earnings per share
      Fiscal year ended March 31, 2025 March 31, 2024	Millions of yen 1,496 6,180	% (75.8) 8.0	Millions of yen 2,253 11,309	% (80.1) 29.1	Yen 35.32 142.55	Yen - -

      	Return on equity attributable to owners of parent	Ratio of profit before tax to total assets
      Fiscal year ended	%	%
      March 31, 2025	1.8	2.9
      March 31, 2024	7.6	6.9

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

      For the fiscal year ended March 31, 2025: ¥1,629 million

      For the fiscal year ended March 31, 2024: ¥1,468 million

   2. Consolidated financial position

      	Total assets	Total equity	Equity attributable to owners of parent	Ratio of equity attributable to owners of parent to total assets	Equity attributable to owners of parent per share
      As of March 31, 2025 March 31, 2024	Millions of yen 120,693 125,622	Millions of yen 82,501 85,511	Millions of yen 82,131 85,163	% 68.0 67.8	Yen 1,964.73 1,985.07

   3. Consolidated cash flows

   	Cash flows from operating activities	Cash flows from investing activities	Cash flows from financing activities	Cash and cash equivalents at end of period
   Fiscal year ended March 31, 2025 March 31, 2024	Millions of yen 10,762 14,060	Millions of yen (4,186) (4,736)	Millions of yen (6,908) (8,960)	Millions of yen 17,715 17,935

2. Cash dividends

   	Annual dividends per share					Total cash dividends (Total)	Payout ratio (Consolidated)	Ratio of dividends to equity attributable to owners of parent (Consolidated)
   	First quarter-end	Second quarter-end	Third quarter-end	Fiscal year-end	Total
   	Yen - -	Yen	Yen - -	Yen	Yen	Millions of yen 3,133 3,222	%	%
   Fiscal year ended March 31, 2024		34.00		38.00	72.00		50.5	3.8
   Fiscal year ended March 31, 2025		38.00		38.00	76.00		215.2	3.8
   Fiscal year ending March 31, 2026 (Forecast)	-	40.00	-	40.00	80.00		49.9

3. Consolidated financial results forecast for the fiscal year ending March 31, 2026 (from April 1, 2025 to March 31, 2026)

(% indicates changes from the previous corresponding period.)

1. Significant changes in the scope of consolidation during the period: None

2. Changes in accounting policies and changes in accounting estimates

   1. Changes in accounting policies required by IFRS: None

   2. Changes in accounting policies due to other reasons: None

   3. Changes in accounting estimates: None

3. Number of issued shares (ordinary shares)

   1. Total number of issued shares at the end of the period (including treasury shares)

      As of March 31, 2025	44,213,536 shares
      As of March 31, 2024	44,213,536 shares

   2. Number of treasury shares at the end of the period

      As of March 31, 2025	2,410,402 shares
      As of March 31, 2024	1,311,503 shares

   3. Average number of shares outstanding during the period

Note: The Company has introduced an executive compensation BIP trust. Shares of the Company owned by the trust are included in the treasury shares.

1. Non-consolidated operating results (% indicates changes from the previous corresponding period.)

   	Net sales		Operating profit		Ordinary profit		Profit
   Fiscal year ended March 31, 2025 March 31, 2024	Millions of yen 50,493 47,744	% 5.8 (0.6)	Millions of yen 356 618	% (42.4) (56.9)	Millions of yen 7,039 8,519	% (17.4) 26.7	Millions of yen 1,824 5,962	% (69.4) 1.7

   	Basic earnings per share	Diluted earnings per share
   Fiscal year ended March 31, 2025 March 31, 2024	Yen 43.06 137.53	Yen - -

2. Non-consolidated financial position

Reference: Equity

As of March 31, 2025 ¥40,723 million

As of March 31, 2024 ¥43,274 million

• Financial results reports are exempt from audit conducted by certified public accountants or an audit firm.

• Proper use of earnings forecasts, and other special matters

Forward-looking statements contained in this document, including financial results forecast, are based on information currently available to the Company and certain assumptions that the Company believes to be reasonable. The Company makes no assurances as to the actual results and/or other outcomes, which may differ significantly from these forecast due to various factors. Please refer to page 3, "1. Overview of Operating Results, etc. (4)Forecast for the Next Fiscal Year" for the suppositions that form the assumptions used for and the use of the financial results forecast.

The Company plans to hold a briefing session for institutional investors and analysts on May 22, 2025. Immediately after the meeting, the presentation materials will be posted on the company website.

Table of Contents

1. Overview of Operating Results, etc 2

   1. Overview of Operating Results 2

   2. Overview of Financial Position 3

   3. Overview of Cash Flows 3

   4. Forecast for the Next Fiscal Year …………………………………………………………………… 3

2. Basic Policy for the Selection of Accounting Standards ………………………………………………… 4

3. Consolidated Financial Statements and Significant Notes ……………………………………………… 5

   1. Consolidated Statement of Financial Position ……………………………………………………… 5

   2. Consolidated Statements of Income and Comprehensive Income 7

      Consolidated Statement of Income 7

      Consolidated Statement of Comprehensive Income ……………………………………………… 8

   3. Consolidated Statement of Changes in Equity ……………………………………………………… 9

   4. Consolidated Statement of Cash Flows 10

   5. Notes to the Consolidated Financial Statements 12

(Going Concern Assumption) 12

(Impairment of Non-financial Assets) 12

(Segment Information) 13

(Earnings per Share) 16

(Subsequent Events) 16

1. Overview of Operating Results, etc.

   1. Overview of Operating Results

      		The fiscal year ended March 31, 2024 (Millions of yen)	The fiscal year ended March 31, 2025 (Millions of yen)	Change (Millions of yen)	Change in ratio (%)
      Revenue		108,278	115,593	7,314	6.8
      	Automotive Parts	53,282	58,056	4,773	9.0
      	Industrial Products	36,672	38,100	1,427	3.9
      	Advanced Elastomer Products	13,769	14,216	446	3.2
      	Other	5,352	6,095	743	13.9
      	Adjustments	(798)	(875)	(76)	-
      Core operating profit (loss) (Segment profit (loss))		7,584	7,743	159	2.1
      	Automotive Parts	4,111	4,897	785	19.1
      	Industrial Products	3,492	2,541	(951)	(27.2)
      	Advanced Elastomer Products	(151)	(15)	136	-
      	Other	73	296	223	306.2
      	Adjustments	57	23	(34)	(59.9)
      Operating profit		7,772	3,480	(4,292)	(55.2)
      Profit attributable to owners of parent		6,180	1,496	(4,683)	(75.8)

      Note: Core operating profit is calculated as revenue subtracted by cost of sales and selling, general, and administrative expenses.

      Revenue for the fiscal year ended March 31, 2025 increased by 6.8% to ¥115,593 million compared with the previous fiscal year, core operating profit increased by 2.1% to ¥7,743 million, operating profit decreased by 55.2% to ¥3,480 million as impairment losses such as that related to a consolidated subsidiary were recorded, and profit attributable to owners of parent decreased by 75.8% to ¥1,496 million.

      The operating results for the fiscal year ended March 31, 2025 by business segment were as follows:

      Automotive Parts

      In Japan, although automobile production volume decreased, sales of accessory drive power transmission belts (such as RIBACE ™) and accessory drive power transmission system goods (such as Auto-Tensioner) increased due to increase in the number of models adopting to the Company's products.

      Overseas, in the U.S. sales of products for aftermarket industries increased. In China and Asia, sales of variable speed belts for scooters, etc. increased as production by motorcycle manufacturers was recovering.

      As a result, revenue increased by 9.0% to ¥58,056 million compared with the previous fiscal year, and segment profit increased by 19.1% to ¥4,897 million.

      Industrial Products

      Regarding industrial power transmission belts, sales of power transmission belts for industrial machinery shifted the same level as the previous year in Japan. Overseas, sales of power transmission belts for industrial machinery increased in the U.S. and Europe, sales of power transmission belts for agricultural machinery increased in China and Asia.

      For conveyor belts, sales of light-duty conveyor belts (such as SUNLINE™ belt) increased in Japan. On the other hand, sales of heavy-duty conveyor belts decreased.

      As a result, revenue increased by 3.9% to ¥38,100 million compared with the previous fiscal year. However, segment profit decreased by 27.2% to ¥2,541 million due to changes in sales mixes and an increase in costs such as raw material costs.

      Advanced Elastomer Products

      Regarding films products, sales of films for construction materials and decorative display films increased.

      For precision parts, sales of precision belts increased. However, sales of high-performance rollers and cleaning blades decreased.

      As a result, revenue increased by 3.2% to ¥14,216 million compared with the previous fiscal year. Segment loss was ¥15 million compared with ¥151 million of segment loss for the previous fiscal year.

      Other

      Other segment mainly includes robotics-related devices, electronic products, and medical equipment businesses. Revenue increased by 13.9% to ¥6,095 million compared with the previous fiscal year. Segment profit increased by 306.2% to ¥296 million compared with the previous fiscal year.

      The above revenues by segment and segment profit or loss were the amount before the elimination of intersegment transactions.

   2. Overview of Financial Position

      Total assets as of March 31, 2025, decreased by ¥4,928 million to ¥120,693 million compared with the end of the previous fiscal year. The main reason was a decrease in property, plant and equipment and goodwill.

      Total liabilities decreased by ¥1,919 million to ¥38,191 million compared with the end of the previous fiscal year. The main reason was a decrease in trade and other payables, borrowings and income taxes payable.

      Total equity decreased by ¥3,009 million to ¥82,501 million compared with the end of the previous fiscal year. The main reason was a decrease in retained earnings in addition to purchase of treasury shares.

      As a result, the ratio of equity attributable to owners of parent to total assets was 68.0%, compared with 67.8% at the end of the previous fiscal year.

   3. Overview of Cash Flows

      Cash and cash equivalents as of March 31, 2025 decreased by ¥219 million to ¥17,715 million compared with the end of the previous fiscal year. The summary of cash flows and major factors were as follows:

      (Cash flows from operating activities)

      Net cash provided by operating activities decreased by ¥3,297 million to ¥10,762 million compared with the previous fiscal year. The main reason was an increase in increase in working capital such as inventories and income taxes paid.

      (Cash flows from investing activities)

      Net cash used in investing activities decreased by ¥550 million to ¥4,186 million compared with the previous fiscal year. The main reason was an increase in proceeds from sale of equity instruments.

      (Cash flows from financing activities)

      Net cash used in financing activities decreased by ¥2,051 million to ¥6,908 million compared with the previous fiscal year. The main reason was a decrease in repayments of borrowings while total shareholder returns increased.

   4. Forecast for the Next Fiscal Year

   Revenue for the fiscal year ending March 31, 2026 is expected to decrease by 0.5% to ¥115,000 million compared with the previous fiscal year, core operating profit is expected to increase by 5.9% to ¥8,200 million, operating profit by 172.9% to ¥9,500 million, and profit attributable to owners of parent by 347.7% to ¥6,700 million.

   The precondition for the above forecasts is as follows:

   Capital expenditure	¥7,200 million
   Depreciation and amortization	¥5,600 million
   Research and development expenses	¥4,200 million
   Exchange rate	¥140/USD
   	¥4.0/THB
   	¥19.5/CNY

2. Basic Policy for the Selection of Accounting Standards

   The Group has adopted International Financial Reporting Standards (IFRS) to further strengthen global business management and improve the international comparability of its financial information.

3. Consolidated Financial Statements and Significant Notes

1. Consolidated Statement of Financial Position

   (Millions of yen)

   Assets

   Current assets

   As of March 31, 2024 As of March 31, 2025

   Cash and cash equivalents	17,935	17,715
   Trade and other receivables	23,329	22,978
   Inventories	19,218	19,530
   Income taxes receivable	104	380
   Other financial assets	1,807	1,530
   Other current assets	1,161	1,259
   Total current assets	63,556	63,396
   Non-current assets
   Property, plant and equipment	32,545	30,532
   Goodwill	4,589	1,175
   Intangible assets	3,188	2,748
   Investments accounted for using equity method	11,493	11,590
   Other financial assets	9,221	10,318
   Deferred tax assets	727	647
   Other non-current assets	300	283
   Total non-current assets	62,065	57,297
   Total assets	125,622	120,693

   Liabilities and equity Liabilities

   Current liabilities

   (Millions of yen) As of March 31, 2024 As of March 31, 2025

   Trade and other payables	18,778	18,098
   Borrowings	5,350	5,350
   Income taxes payable	1,035	764
   Other financial liabilities	1,130	1,064
   Provisions	0	1
   Other current liabilities	6,163	6,013
   Total current liabilities	32,458	31,292
   Non-current liabilities
   Borrowings	2,237	1,787
   Retirement benefit liability	753	880
   Other financial liabilities	1,752	1,649
   Deferred tax liabilities	1,859	1,895
   Other non-current liabilities	1,048	686
   Total non-current liabilities	7,652	6,899
   Total liabilities	40,111	38,191
   Equity
   Share capital	10,951	10,951
   Capital surplus	2,936	2,921
   Retained earnings	61,039	59,418
   Treasury shares	(1,692)	(3,678)
   Other components of equity	11,927	12,519
   Total equity attributable to owners of parent	85,163	82,131
   Non-controlling interests	347	369
   Total equity	85,511	82,501
   Liabilities and equity	125,622	120,693

2. Consolidated Statements of Income and Comprehensive Income (Consolidated Statement of Income)

   Fiscal year ended March 31, 2024

   (Millions of yen)

   Fiscal year ended March 31, 2025

   Revenue	108,278	115,593
   Cost of sales	77,246	82,805
   Gross profit	31,032	32,787
   Selling, general and administrative expenses	23,447	25,044
   Other income	340	678
   Other expenses	1,620	6,570
   Share of profit of investments accounted for using equity method	1,468	1,629
   Operating profit	7,772	3,480
   Finance income	1,266	582
   Finance costs	363	590
   Profit before tax	8,676	3,472
   Income tax expenses	2,458	1,931
   Profit	6,217	1,541
   Profit attributable to
   Owners of parent	6,180	1,496
   Non-controlling interests	37	44
   Profit	6,217	1,541

   Earnings per share

   Basic earnings per share (Yen) 142.55 35.32

   (Consolidated Statement of Comprehensive Income)

   Fiscal year ended March 31, 2024

   (Millions of yen)

   Fiscal year ended March 31, 2025

   Profit 6,217 1,541

   Other comprehensive income

   Items that will not be reclassified to profit or loss

   Net change in fair value of equity instruments
   designated as measured at fair value through	1,900	870
   other comprehensive income
   Remeasurements of defined benefit plans	(79)	(80)
   Share of other comprehensive income of
   investments accounted for using equity	33	83
   method
   Total	1,855	872
   Items that may be reclassified to profit or loss

   Exchange differences on translation of foreign operations

   Share of other comprehensive income of

   2,624 161

   investments accounted for using method	equity	612	(321)
   Total		3,237	(159)
   Total other comprehensive income		5,092	712
   Comprehensive income		11,309	2,253
   Comprehensive income attributable to Owners of parent		11,227	2,210
   Non-controlling interests		82	43
   Comprehensive income		11,309	2,253

3. Consolidated Statement of Changes in Equity

   Equity attributable to owners of parent

   Total

   Non-

   (Millions of yen)

   Share capital

   Capital surplus

   Retained earnings

   Treasury shares

   Other component s of equity

   equity attributable to owners of parent

   controlling interests

   Total

   Balance as of April 1, 2023	10,951	3,112	60,380	(3,577)	6,789	77,656	356	78,013
   Profit			6,180			6,180	37	6,217
   Other comprehensive income					5,047	5,047	45	5,092
   Total comprehensive income	-	-	6,180	-	5,047	11,227	82	11,309
   Dividends of surplus			(2,784)			(2,784)	(91)	(2,875)
   Purchase of treasury shares				(1,001)		(1,001)		(1,001)
   Disposal of treasury shares		1		6		7		7
   Cancellation of treasury shares		(235)	(2,646)	2,881		-		-
   Share-based payment transactions		58				58		58
   Transfer from other components of equity to retained earnings			(91)		91	-		-
   Change in scope of consolidation				(0)		(0)		(0)
   Total transactions with the owners	-	(175)	(5,521)	1,885	91	(3,720)	(91)	(3,811)
   Balance as of March 31, 2024	10,951	2,936	61,039	(1,692)	11,927	85,163	347	85,511
   Profit			1,496			1,496	44	1,541
   Other comprehensive income					713	713	(1)	712
   Total comprehensive income	-	-	1,496	-	713	2,210	43	2,253
   Dividends of surplus			(3,240)			(3,240)	(21)	(3,261)
   Purchase of treasury shares				(2,001)		(2,001)		(2,001)
   Disposal of treasury shares		1		14		15		15
   Share-based payment transactions		(15)				(15)		(15)
   Transfer from other components of equity to
   retained earnings			122		(122)	-		-
   Total transactions with the owners	-	(14)	(3,117)	(1,986)	(122)	(5,242)	(21)	(5,263)
   Balance as of March 31, 2025	10,951	2,921	59,418	(3,678)	12,519	82,131	369	82,501

4. Consolidated Statement of Cash Flows

   Cash flows from operating activities

   Fiscal year ended March 31, 2024

   (Millions of yen)

   Fiscal year ended March 31, 2025

   Profit before tax 8,676 3,472

   Depreciation and amortization 5,859 5,818

   Impairment loss 1,427 5,942

   Interest and dividend income (425) (557)

   Interest expenses 90 96

   Foreign exchange loss (gain) (769) 120

   Share of loss (profit) of investments accounted for using equity method	(1,468)	(1,629)
   Loss (gain) on sale and retirement of fixed assets	6	24
   Decrease (increase) in inventories	503	(625)
   Decrease (increase) in trade and other receivables	(573)	118
   Increase (decrease) in trade and other payables	1,195	(779)
   Increase (decrease) in retirement benefit liability	83	155
   Increase (decrease) in provisions	(1)	0
   Increase (decrease) in other current liabilities	449	(8)
   Increase (decrease) in other non-current liabilities	(343)	(356)
   Other	456	(245)
   Subtotal	15,166	11,548
   Interest and dividends received	1,060	2,122
   Interest paid	(90)	(84)
   Income taxes paid	(2,675)	(3,023)
   Income taxes refund	599	199
   Net cash provided by (used in) operating activities	14,060	10,762
   Cash flows from investing activities
   Payments into time deposits	(1,992)	(3,018)
   Proceeds from withdrawal of time deposits	1,503	3,179
   Purchase of property, plant and equipment	(4,120)	(4,265)
   Proceeds from sale of property, plant and equipment	75	133
   Purchase of intangible assets	(254)	(311)
   Proceeds from sale of equity instruments	-	326
   Purchase of shares of investments accounted for	-	(198)

   using equity method

   Income from purchase of shares of subsidiaries resulting in change in scope of consolidation

   41 －

   Other 9 (32)

   Net cash provided by (used in) investing activities (4,736) (4,186)

   Cash flows from financing activities

   Fiscal year ended March 31, 2024

   (Millions of yen)

   Fiscal year ended March 31, 2025

   Net increase (decrease) in short-term borrowings Repayments of long-term borrowings	2,664 (3,650)	900 (1,350)
   Repayments of lease liabilities	(1,099)	(1,195)
   Redemption of bonds	(3,000)	-
   Purchase of treasury shares	(1,001)	(2,001)
   Proceeds from sale of treasury shares	1	-
   Dividends paid to owners of parent	(2,784)	(3,240)
   Dividends paid to non-controlling interests	(91)	(21)
   Net cash provided by (used in) financing activities	(8,960)	(6,908)

   Effect of exchange rate changes on cash and cash equivalents

   Net increase (decrease) in cash and cash equivalents

   801 112

   1,164 (219)

   Cash and cash equivalents at beginning of period 16,770 17,935

   Cash and cash equivalents at end of period 17,935 17,715

5. Notes to the Consolidated Financial Statements (Going Concern Assumption)

None

(Impairment of Non-financial Assets)

The Group assesses for impairment of assets by each cash-generating unit, which is the smallest identifiable group asset that generates largely independent cash flows. As a result of impairment assessment, if the recoverable amount is lower than the carrying amount, the carrying amount is reduced to the recoverable amount, and the Group records impairment losses as "Other expenses" on consolidated statements of income.

Assets that the Group recorded impairment losses for the fiscal year ended March 31, 2025 are as follows.

In the Automotive Parts Business, the Group recorded an impairment loss of ¥850 million as business restructuring expenses due to the decision to terminate production at Bando USA, Inc. The recoverable amount was measured based on value in use, which was assumed as zero. The disclosure of discount rate is omitted as the estimated undiscounted future cash flows were negative.

The Group recorded an impairment loss of ¥1,604 million for certain assets in the Advanced Elastomer Products Business, due to identifying impairment indicators by decrease in its profitability. The recoverable amount was measured based on value in use or fair value less costs of disposal. The value in use was assumed as zero. The disclosure of discount rate is omitted as the estimated undiscounted future cash flows were negative. For fair value less costs of disposal, its fair value hierarchy was level 3.

In the Other segment, the Group recorded an impairment loss of ¥3,406 million as a result of assessing for impairment of goodwill related to acquisition of shares of Aimedic MMT Co., Ltd. ("AIM"), a consolidated subsidiary, based on AIM's latest business plan. The recoverable amount was measured based on value in use. The pre-tax discount rate used to calculate its value in use was 11.7%.

In addition, the Group recorded an impairment loss of ¥81 million due to identifying impairment indicators such as a decrease in its profitability for certain assets in each segment. The recoverable amount was measured based on value in use, which was assumed as zero. The disclosure of discount rate is omitted as the estimated undiscounted future cash flows were negative.

(Segment Information)

1. Summary of reportable segments

   The reportable segments are components of the Company for which separate financial information is available and whose operating results are reviewed by the Board of Directors to allocate resources and assess segment performance.

   The Group comprises operating divisions based on products and services, and each operating division develops a comprehensive strategy for respective products and services for domestic and overseas markets and conducts business activities.

   Therefore, the Group's business consists of three reportable segments categorized by products and services based on operating division of the parent company: "Automotive Parts Business," "Industrial Products Business," and "Advanced Elastomer Products Business."

   The main products by reportable segment are as follows:

   Segment name	Main products
   Automotive Parts Business	Automotive power transmission belt products (accessory drive power transmission belts and system goods), power transmission belt products for motorcycles (variable speed belts for scooters), etc.
   Industrial Products Business	Industrial power transmission belt products (Industrial machinery V-belts, synchronous belts, pulleys, etc.), other power transmission products, conveyor belts (heavy-duty conveyor belts, light-duty conveyor belts, synchronous conveyance belts, etc.), conveyor system goods, rice hulling rolls, etc.
   Advanced Elastomer Products Business	Cleaning blades, high-performance rollers, precision belts, polyurethane functional parts, precision polishing materials, films for construction materials, medical films, decorative display films, industrial films, etc.

2. Information on revenue, profit or loss, and other items by reportable segments Intersegment revenue is based on market prices.

Revenue, profit or loss, and other items by reportable segments are as follows:

Fiscal year ended March 31, 2024 (Millions of yen)

Notes:

1. The Other segment comprises businesses that are not included in any reportable segments. It mainly includes the medical equipment and robotics-related devices businesses.

2. Adjustments are as follows:

   1. Adjustments of segment profit (loss) of ¥57 million include the elimination of intersegment transactions of ¥ (0) million and corporate expenses of ¥57 million. Corporate expenses are differences between the estimated allocation of general administrative expenses and research and development expenses to each reportable segment and the actual amount incurred.

   2. Adjustments of increase in property, plant and equipment and intangible assets of ¥781 million are mainly related to non-current assets not belonging to any reportable segments.

3. The Group uses core operating profit, calculated as revenue subtracted by cost of sales and selling, general and administrative expenses, as a key indicator for business management. Segment profit (loss) is based on core operating profit.

Fiscal year ended March 31, 2025 (Millions of yen)

Notes:

1. The Other segment comprises businesses that are not included in any reportable segments. It mainly includes the medical equipment and robotics-related devices businesses.

2. Adjustments are as follows:

   1. Adjustments of segment profit (loss) of ¥23 million include the elimination of intersegment transactions of ¥39 million and corporate expenses of ¥ (16) million. Corporate expenses are differences between the estimated allocation of general administrative expenses and research and development expenses to each reportable segment and the actual amount incurred.

   2. Adjustments of increase in property, plant and equipment and intangible assets of ¥484 million are mainly related to non-current assets not belonging to any reportable segments.

3. The Group uses core operating profit, calculated as revenue subtracted by cost of sales and selling, general and administrative expenses, as a key indicator for business management. Segment profit (loss) is based on core operating profit.

(Earnings per Share)

The basis for calculation of basic earnings per share is as follows:

The disclosure of diluted earnings per share is omitted as there are no potentially dilutive shares. (Subsequent Events)

None