Kaga Electronics : Earnings Presentation FY2026/3

About this update from Kaga Electronics Co., Ltd.

FY2026/March Q4 and Full-Year Earnings Presentation KAGA ELECTRONICS CO., LTD. 2023 - 2025 2021 - 2025 TSE Prime Market 8154 May 14, 2026 FY2026/3 (Full-Year) P- 2～ Summary/Financial Highlights/Results by Segment・Company FY2026/3 Q4（３months） P- 10～ Financial Highlights/Results by Segment・Company Balance Sheet/Cash flows P- 13～ Summary/Balance Sheet Main Items/Cash flows Forecasts for FY2027/3 P- 18～ Forecasts/Forecasts by Segment/Shareholder Returns Reference P- 22～ Quarterly trends (Net Sales・Income by segment, Net Sales by Region）/ Results by MTMP Segment（Full-Year , ３months）/ Latest 5 years Financial Trends/Exchange Rate/FOREX Sensitivity Results for FY2026/3 (billion yen) Net Sales Operating income Net income Results 658.9 27.8 31.0 YoY +111.1 [＋20.3%] +4.2 [＋17.9%] +14.0 [＋82.0%] Both net sales and income at all levels of profit achieved double-digit year-on-year growth. Net sales and net income achieved record highs for the first time in three fiscal years, marking a solid start in the first year of our Medium-Term Management Plan 2027. Net sales : Electronic components, information equipment, and others business all maintained robust performance. The consolidation of Kyoei Sangyo commenced from Q2. In Q4, spot sales (approximately 41.1 billion yen) in response to supply shortages of certain semiconductor products made a significant contribution to the increase in net sales. Operating income : The increase in gross profit driven by higher net sales more than offset the rise in SG&A expenses, leading to year-on-year growth. Net income : In addition to higher net income from core operations, the following items were recorded as extraordinary income: "Gain on bargain purchase from a corporate acquisition (approximately 7.7 billion yen)" , and "Gain on sale of investment securities (approximately 1.6 billion yen)" resulting from the reduction of cross-shareholdings. (billion yen) Net Sales Operating income Net income FY2027/3 earnings forecasts Forecasts 645.0 28.5 20.0 YoY -13.9 [-2.1%] +0.6 [＋2.4%] -11.0 [-35.7%] Net sales :Net sales are expected to decline due to the absence of one-off items recorded in the fiscal year ended March 2026. However, on an underlying basis, the upward trend is expected to continue. Operating income :Income growth is expected to be sustained, supported by improvements in gross profit margin and efforts to maintain strict cost control. Net income :Net income is expected to decline due to the absence of extraordinary income (approximately 10 billion yen) recorded in the fiscal year ended March 2026. FY2026/3 :Compared to the previous forecast, the year-end dividend has been increased by 10 yen to 80 yen, bringing the annual dividend to 140 yen per share, a year-on-year increase of 30 yen. FY2027/3 :Notwithstanding the projected decrease in profit, the previous fiscal year's dividend payment (140 yen per share) will be maintained. Shareholder Return Full-Year Results （Apr. - Mar.） Forecasts （Announced on Feb. 12, 2026） （million yen） FY2025/3 Composition Ratio FY2026/3 Composition Ratio YoY Net Sales 547,779 100.0% 658,941 100.0% 20.3% Gross Profit 71,665 13.1% 85,350 13.0% 19.1% SG&A 48,064 8.8% 57,525 8.7% 19.7% Operating income 23,601 4.3% 27,824 4.2% 17.9% Ordinary income 22,593 4.1% 29,930 4.5% 32.5% Profit attibutable to owners of parent 17,083 3.1% 31,099 4.7% 82.0% EPS（yen） 325.08 ー 627.71 ー 93.1% ROE 10.8% ー 17.8% ー 7.0pt Annual dividend Total 110 ー 140 ー 30 （yen） interim 55 ー 60 ー 5 year-end 55 ー 80 ー 25 Exchange rate yen / US$ 152.58 ー 150.77 ー ー FY2026/3 Composition Ratio Achivement vs. forecast 620,000 100.0% 106.3% ー ー ー ー ー ー 27,000 4.4% 103.1% 28,000 4.5% 106.9% 28,500 4.6% 109.1% 575.24 ー ー 16.5% ー ー ー ー ー ー ー ー ー ー ー 140.00 ー ー Note: 1. The effect of exchange rates on the conversion into yen is approximately -1,200 million yen on net sales and +32 million yen on operating income. 3 2. The Company conducted a two-for-one stock split of its common stock effective Oct. 1, 2024. EPS for the previous fiscal year is calculated on the assumption that the stock split was conducted at the beginning of the previous fiscal year. Full-Year Results （million yen） FY2025/3 profit margin FY2026/3 profit margin YoY Electronic Component Net sales 472,910 568,834 20.3% Segment income 16,927 3.6% 19,304 3.4% 14.0% Information Equipment Net sales 42,652 54,182 27.0% Segment income 3,307 7.8% 4,444 8.2% 34.4% Software Net sales 3,387 3,307 -2.4% Segment income 509 15.1% 365 11.1% -28.2% Others Net sales 28,829 32,617 13.1% Segment income 2,707 9.4% 3,487 10.7% 28.8% Total Net sales 547,779 658,941 20.3% Segment income 23,601 4.3% 27,824 4.2% 17.9% （Apr. - Mar.） Forecasts （Announced on Feb. 12, 2026） FY2026/3 profit Achivement margin vs. forecast 541,500 105.0% 20,000 3.7% 96.5% 45,000 120.4% 3,500 7.8% 127.0% 3,500 94.5% 500 14.3% 73.2% 30,000 108.7% 3,000 10.0% 116.3% 620,000 106.3% 27,000 4.4% 103.1% Note: Figures of each segment income are not inter-segment adjusted. Total amount is inter-segment adjusted (operating income). Full-Year Results （Apr. - Mar.） （million yen） FY2025/3 profit margin FY2026/3 profit margin YoY Kaga Electronics Net sales 319,527 348,693 9.1% Gross Profit 49,919 15.6% 55,070 15.8% 10.3% Operating income 19,855 6.2% 21,740 6.2% 9.5% Kaga FEI Net sales 197,868 242,241 22.4% Gross Profit 17,901 9.0% 19,955 8.2% 11.5% Operating income 1,860 0.9% 3,346 1.4% 79.9% Excel Net sales 30,383 27,646 -9.0% Gross Profit 3,782 12.4% 3,659 13.2% -3.2% Operating income 1,645 5.4% 1,517 5.5% -7.8% Kyoei Sangyo Net sales ー 40,360 ー Gross Profit ー ー 6,722 16.7% ー Operating income ー ー 1,128 2.8% ー Total Net sales 547,779 658,941 20.3% Gross Profit 71,665 13.1% 85,350 13.0% 19.1% Operating income 23,601 4.3% 27,824 4.2% 17.9% Note : 1.With respect to gross profit and operating income, figures presented above are before consolidation adjustments between the four companies. 2.Kyoei Sangyo became a consolidated subsidiary effective Jul. 18, 2025. Net sales Operating income +95.9 Electric Components （Excluding Equipment Software spot sales） +54.8 Spot sales +41.1 +11.5 Others +3.8 658.9 -0.08 547.7 Kyoei Sangyo +40.4 Sales Increase JPY 111.1 bn （of which, impact of exchange rates -1.2 bn ） Information （billion yen） Gross Profit +13.7 （billion yen） Personnel expenses *Of which special bonus Packing and freightage Expenses 23.6 Sales mix （Improvement in gross profit margin） +2.3 27.8 SG&A Spot sales +2.2 Sales Volume +9.2 SG&A expenses i （"-" figures for ndicate increase in expenses） -9.5 Kyoei Sangyo Income Increase -5.6 JPY 4.2 bn （of which, impact of exchange rates +0.03 bn ） Promotion expenses, etc. -5.2 -1.0 -1.0 -1.3 FY25/3 Result FY26/3 Result FY25/3 Result FY26/3 Result Net sales Operating income （billion yen） （billion yen） Sangyo +40.4 658.9 Kaga Electronics +29.1 Kaga FEI +44.4 Excel -2.7 618.5 547.7 Sales Increase JPY 70.8 bn Sales Increase JPY 111.1 bn Kyoei Kyoei Kaga Kaga FEI Electronics Excel +1.4 26.7 Sangyo +1.1 27.8 23.6 +1.8 -0.1 Income Increase JPY 3.1 bn Income Increase JPY 4.2 bn FY25/3 Result Excluding Kyoei Sangyo FY26/3 Result FY25/3 Result Excluding Kyoei Sangyo FY26/3 Result Note : With respect to gross profit and operating income, figures presented above are before consolidation adjustments between the four companies. FY2026/3 Net Sales 472,910 +95,924 20.3% Segment income 16,927 +2,377 14.0% Profit margin 3.6% -0.2pt 3.4% 19,304 568,834 （million yen） FY2025/3 YoY （billion yen） 184.9 114.7 111.3 114.5 120.3 126.6 116.4 131.3 136.1 FY24/3 Q4 FY25/3 Q1 Q2 Q3 Q4 FY26/3 Q1 Q2 Q3 Q4 Net sales/Segment income Main factors behind increase/decrease 472,910 16,927 19,304 3.6% 3.4% （million yen） FY25/3 Results Net Sales Segment income Profit margin 568,834 FY26/3 Results Components sales business EMS Business （+）Easing inventory adjustments in the supply chain （+）Kyoei Sangyo was consolidated from Q2. （+）Spot sales in response to the tight supply-demand conditions for commodity memory products contributed to increased sales As a result, net sales and income both increased year-on-year （+）Capacity expansion at overseas production sites contributed to increased sales （+）Robust sales to medical and air-conditioning equipment sectors （ー）Demand decrease at some customers in the automotive sector As a result, net sales and income both increased year-on-year 8 FY2026/3 Net Sales 42,652 +11,529 27.0% Segment income 3,307 +1,137 34.4% Profit margin 7.8% +0.4pt 8.2% 4,444 54,182 （million yen） FY2025/3 YoY （billion yen） 20.5 14.0 15.6 10.6 12.1 12.0 8.0 8.3 9.4 FY24/3 Q4 FY25/3 Q1 Q2 Q3 Q4 FY26/3 Q1 Q2 Q3 Q4 Net sales/Segment income Main factors behind increase/decrease 42,652 4,444 3,307 7.8% 8.2% （million yen） FY25/3 Results Net Sales Segment income Profit margin 8.2% 54,182 FY26/3 Results PC sales business Electrical and telecommunication equipment installation business （+）Robust sales to educational institutions, driven by initiatives undertaken to increase the number of partner schools （+）Robust sales to mass retailers, driven by new product launches, including AI PCs （+）Sales of security software for mobile devices contributed to the increase in net sales As a result, net sales and income both increased year-on-year （+）Strong LED installation to major convenience stores and financial institutions （+）Steady growth in orders received for construction works for solar panels and electrical substations As a result, net sales and income both increased year-on-year 9 Q4 Results （Jan. - Mar.） Q3 Results （Oct. - Dec.） Q4 Results （Jan. - Mar.） （million yen） FY2025/3 Composition Ratio FY2026/3 Composition Ratio FY2026/3 Composition Ratio YoY QoQ Net Sales 151,536 100.0% 156,516 100.0% 213,466 100.0% 40.9% 36.4% Gross Profit 19,475 12.9% 20,416 13.0% 25,388 11.9% 30.4% 24.4% SG&A 13,930 9.2% 14,016 9.0% 17,013 8.0% 22.1% 21.4% Operating income 5,545 3.7% 6,400 4.1% 8,374 3.9% 51.0% 30.8% Ordinary income 4,214 2.8% 7,323 4.7% 9,164 4.3% 117.5% 25.1% Profit attibutable to owners of parent 4,368 2.9% 9,275 5.9% 6,790 3.2% 55.5% -26.8% EPS（yen） 83.11 ー 194.61 ー 142.48 ー ー ー Exchange rate yen / US$ 152.58 ー 148.74 ー 150.77 ー ー ー Note: 1. The effect of exchange rates on the conversion into yen is approximately -218 million yen on net sales and +5 million yen on operating income. 2. The Company conducted a two-for-one stock split of its common stock effective Oct. 1, 2024. EPS for the previous fiscal year is calculated on the assumption that the stock split was conducted at the beginning of the previous fiscal year. Q4 Results （Jan. - Mar.） Q3 Results （Oct. - Dec.） Q4 Results （Jan. - Mar.） （million yen） FY2025/3 profit FY2026/3 profit FY2026/3 profit margin YoY QoQ margin margin Electronic Net sales 126,697 136,103 184,942 46.0% 35.9% Component Segment income 3,358 2.7% 4,800 3.5% 5,536 3.0% 64.8% 15.3% Information Net sales 15,699 12,080 20,530 30.8% 69.9% Equipment Segment income 1,353 8.6% 883 7.3% 1,944 9.5% 43.6% 120.2% Software Net sales 1,316 846 781 -40.7% -7.8% Segment income 201 15.3% 68 8.1% 131 16.9% -34.5% 92.2% Others Net sales 7,822 7,485 7,212 -7.8% -3.6% Segment income 610 7.8% 624 8.3% 740 10.3% 21.3% 18.7% Total Net sales 151,536 156,516 213,466 40.9% 36.4% Segment income 5,545 3.7% 6,400 4.1% 8,374 3.9% 51.0% 30.8% Note: Figures of each segment income are not inter-segment adjusted. Total amount is inter-segment adjusted (operating income). Q4 Results （Jan. - Mar.） Q3 Results （Oct. - Dec.） Q4 Results （Jan. - Mar.） （million yen） FY2025/3 profit margin FY2026/3 profit margin FY2026/3 profit margin YoY QoQ Kaga Electronics Net sales 90,546 89,259 94,576 4.4% 6.0% Gross Profit 13,557 15.0% 13,247 14.8% 14,875 15.7% 9.7% 12.3% Operating income 4,560 5.0% 5,396 6.0% 5,223 5.5% 14.5% -3.2% Kaga FEI Net sales 52,305 48,779 95,518 82.6% 95.8% Gross Profit 4,783 9.1% 4,658 9.5% 6,423 6.7% 34.3% 37.9% Operating income 386 0.7% 857 1.8% 1,465 1.5% 279.1% 70.9% Excel Net sales 8,683 6,079 8,538 -1.7% 40.4% Gross Profit 1,105 12.7% 812 13.4% 1,176 13.8% 6.5% 44.9% Operating income 525 6.0% 330 5.4% 539 6.3% 2.7% 63.1% Kyoei Sangyo Net sales ー ー 12,398 14,833 ー 19.6% Gross Profit ー ー 1,753 14.1% 2,910 19.6% ー 66.0% Operating income ー ー -169 ー 1,109 7.5% ー ー Total Net sales 151,536 156,516 213,466 40.9% 36.4% Gross Profit 19,475 12.9% 20,416 13.0% 25,388 11.9% 30.4% 24.4% Operating income 5,545 3.7% 6,400 4.1% 8,374 3.9% 51.0% 30.8% Note: 1. With respect to gross profit and operating income, figures presented above are before consolidation adjustments between the four companies. 2. Kyoei Sangyo became a consolidated subsidiary effective Jul. 18, 2025. 12 (million yen) 2025/3 2026/3 Change from end of FY2025/3 ASSETS Current assets 257,164 342,368 +85,204 Cash and deposits 80,188 89,706 +9,517 Notes and accounts receivable -trade 114,139 173,355 +59,216 Inventories 51,774 68,004 +16,230 Other 11,061 11,302 +240 Non-current assets 48,507 61,325 +12,818 Property, plant and equipment 28,445 31,624 +3,179 Buildings and structures 9,839 11,839 +1,999 Machinery, equipment and vehicles 11,034 11,898 +864 Tools, furniture and fixtures 1,217 1,282 +64 Land 5,940 6,237 +296 Construction in progress 413 366 -46 Intangible assets 1,738 1,911 +173 Software 1,694 1,873 +179 Other 44 38 -5 Total investments and other assets 18,323 27,789 +9,465 Investment securities 12,556 19,403 +6,846 Distressed receivables 4,815 4,662 -152 Allowance for doubtful accounts -4,873 -4,785 +88 Other 5,825 8,508 +2,682 Total assets 305,671 403,694 +98,022 (million yen) 2025/3 2026/3 Change from end of FY2025/3 LIABILITIES Current liabilities 117,704 195,444 +77,739 Notes and accounts payable -trade 73,340 94,373 +21,033 Short-term loans payable 14,890 68,398 +53,507 Current portion of bonds payable 5,000 200 -4,800 Other 24,473 32,472 +7,998 Non-current liabilities 21,587 24,733 +3,145 Bonds payable 5,000 5,200 +200 Long-term loans payable 5,500 6,571 +1,071 Other 11,087 12,962 +1,874 Total liabilities 139,292 220,177 +80,885 NET ASSETS Shareholders' equity 142,993 153,948 +10,955 Capital stock 12,133 12,133 - Capital surplus 14,885 14,767 -118 Retained earnings 121,553 136,955 +15,402 Treasury shares -5,579 -9,908 -4,328 Total accumulated other comprehensive income 23,225 29,555 +6,329 Non-controlling interests 160 12 -148 Total net assets 166,379 183,516 +17,136 Total liabilities and net assets 305,671 403,694 +98,022 Summary of Balance Sheet Total assets Total liabilities and net assets Current assets Non-current assets Current ratio 175.2% 233.4% 218.5% （million yen） Total liabilities Total net assets Debt ratio Main balance sheet changes Current assets (＋) 57,243 million yen increase in accounts receivable - trade (＋) 13,596 million yen increase in merchandise and finished goods Non-current assets (＋) 3,179 million yen increase in property, plant and equipment (＋) 6,846 million yen increase in investment securities Liabilities (＋) 53,507 million yen increase in short-term loans payable (＋) 21,033 million yen increase in notes and accounts payable -trade Net assets (＋) 15,402 million yen increase in retained earnings （million yen） 120.0% 403,694 +98,022 89.9% 83.8% 403,694 +98,022 286,792 305,671 342,368 +85,204 244,629 257,164 61,325 139,292 220,177 +80,885 286,792 305,671 135,560 151,231 166,379 183,516 +17,136 42,162 48,507 +12,818 2024/3 2025/3 2026/3 2024/3 2025/3 2026/3 Note: Current ratio ＝ Current asset ÷ current liabilities × 100 Note: Debt ratio = Total liabilities ÷ Equity capital × 100 Inventories Inventories Consolidated vs end of FY2025/3： ＋16.2bn, ＋3.2days Trading business vs end of FY2025/3： ＋12.9bn, +4.3days of which, Kyoei Sangyo +7.2bn Manufacturing business vs end of FY2025/3： ＋3.2bn, +3.1days Inventory value increased along with higher net sales in the EMS business Accounts receivable Accounts receivable vs end of FY2025/3： ＋59.2bn, ＋19.9days ・Increase in total assets →Due to increase in accounts receivable resulting from large-scale spot sales and the consolidation of Kyoei Sangyo. Accounts receivable/Accounts payable Inventories（manufacturing biz) Inventories（trading biz） Inventory turnover (Consolidated） （million yen） Notes and A/R Notes and A/P A/P turnover （million yen） Inventory turnover（manufacturing biz) Inventory turnover（trading biz） A/R turnover 96.0days 75.7days 76.1days 57.4days 58.0days 60.0days 173,355 +59,216 112,574 114,139 71,392 73,340 94,373 +21,033 70.9days 60.7days 63.8days 36.8days 34.5days 37.7days 26.6days 25.6days 29.9days 68,004 +16,230 54,739 51,774 26,409 +3,278 24,289 23,130 30,449 28,643 41,594 +12,951 2024/3 2025/3 2026/3 Note：Inventory turnover＝Inventories ÷ Net Sales × 365 2024/3 2025/3 2026/3 Notes:1. A/R turnover＝Notes and A/R ÷ Net sales × 365 A/P turnover＝Notes and A/P ÷ Total purchase of goods × 365 Notes and A/Rare amounts including Electronically recorded monetary claims-operating 15 Notes and A/Pare amounts including Electronically recorded obligations -operating Cash and Deposits/Interest Bearing Debt Cash flows Cash and deposits Interest bearing debts D/E ratio Net D/E ratio 0.23times 0.20times （million yen） 0.46times -0.03times Cash flows from financing activities Cash flows from investing activities Cash flows from operating activities Free Cash Flow 26,417 15,080 （million yen） -0.21times -0.28times -5,937 66,596 80,188 89,706 29,385 25,047 20,329 -2,968 -2,471 -9,967 -3,466 -16,973 -7,343 +9,517 84,382 +50,885 34,270 33,496 2024/3 2025/3 2026/3 Cash flows Operating activities 2,471 million yen used. Mainly due to an increase in accounts receivable from large-scale spot sales. Investing activities 3,466 million yen used. Mainly due to purchase of shares of subsidiaries resulting in change in scope of consolidation. Financing activities 20,329 million yen provided. Mainly due to an increase in short-term loans payable. Note:1. D/E ratio＝Interest bearing debts ÷ Shareholder's equity 2. Net D/E ratio＝（Interest bearing debts -Cash and deposits） ÷Shareholder's equity 2024/3 2025/3 2026/3 Equity ratio ROE Total assets Equity Equity Ratio 52.6% 54.4% （million yen） 45.5% 403,694 +98,022 Total asset turnover Financial leverage Net profit margin ROE 14.5% 10.8% （%, times, turns） Equity ratio Equity ratio -8.9pt Increase in total assets →Due to an increase in notes and accounts receivable resulting from large-scale spot sales and the consolidation of Kyoei Sangyo. ROE ROE +7.0pt Enhancement of profitability (net profit margin) 17.8% 305,671 286,792 ,834 ,218 183,503 +17,284 150 166 1.9 1.8 3.1 3.7 4.7 1.9 2.0 2.0 1.9 2024/3 2025/3 2026/3 2024/3 2025/3 2026/3 Forecasts Composition Ratio 645,000 100.0% 28,500 4.4% 28,000 4.3% 20,000 3.1% 419.65 ー 10.5% ー 140 ー 70 ー 70 ー 150.00 ー FY2026/3 FY2027/3 Composition (million yen) Results Ratio YoY Net Sales 658,941 100.0% -2.1% Operating income 27,824 4.2% 2.4% Ordinary income 29,930 4.5% -6.5% Profit attibutable to owners of parent 31,099 4.7% -35.7% EPS（yen） 627.71 ー -208.06 ROE 17.8% ー -7.3pt Annual dividend Total 140 ー ー （yen） interim 60 ー 10 year-end 80 ー -10 Exchange rate yen / US$ 150.77 ー ー Forecasts profit margin 550,000 20,000 3.6% 57,500 5,000 8.7% 3,500 500 14.3% 34,000 3,000 8.8% 645,000 28,500 4.4% FY2026/3 FY2027/3 profit (million yen) Results margin YoY Electronic Component Information Equipment Software Others Total Net sales 568,834 Segment income 19,304 3.4% Net sales 54,182 Segment income 4,444 8.2% Net sales 3,307 Segment income 365 11.1% Net sales 32,617 Segment income 3,487 10.7% Net sales 658,941 Segment income 27,824 4.2% Note: Figures of each segment income are not inter-segment adjusted. Total amount is inter-segment adjusted (operating income). -3.3% 3.6% 6.1% 12.5% 5.8% 36.7% 4.2% -14.0% -2.1% 2.4% 1

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