Interim report
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Note : This document has been translated from the Japanese original for reference purposes only . In the event of any discrepancy between this translated document and the Japanese original , the original shall prevail . Consolidated Financial Results for the Three Months Ended June 30 , 2026 ( Under Japanese GAAP ) Company name : Harmonic Drive Systems Inc. Listing : Tokyo Stock Exchange Securities code : 6324 URL : https://www.hds.co.jp/ Representative : Akira Maruyama Inquiries : Tetsuya Shiokawa Telephone : + 81-3-5471-7810 Scheduled date to commence dividend payments : - Preparation of supplementary material on financial results : Yes Holding of financial results briefing : Yes ( for analysts ) President and Representative Director Executive Officer August 7 , 2026 Accounting Standards Fou FASF MEMBERSHIP プライム JPX PRIME ( Yen amounts are rounded down to millions , unless otherwise noted . ) 1. Consolidated financial results for the three months ended June 30 , 2026 ( from April 1 , 2026 to June 30 , 2026 ) ( 1 ) Consolidated operating results ( cumulative ) ( Percentages indicate year - on - year changes . ) Net sales Three months ended June 30 , 2026 Millions of yen 16,681 % Operating profit Millions of yen Ordinary profit June 30 , 2025 Note : Comprehensive income 13,496 23.6 3.8 1,840 122 % Millions of yen 1,719 % Profit attributable to owners of parent Millions of yen % 131 1,274 ( 38 ) For the three months ended June 30 , 2026 : For the three months ended June 30 , 2025 : ¥ ¥ 1,942 ( 1,068 ) million [ - % ] million [ - % ] Basic earnings per share Diluted earnings per share Three months ended Yen Yen June 30 , 2026 13.46 ( 0.40 ) June 30 , 2025 ( 2 ) Consolidated financial position As of June 30 , 2026 March 31 , 2026 Total assets Net assets Equity - to - asset ratio Millions of yen 113,208 111,400 Millions of yen % 81,386 71.9 80,390 72.2 ¥ 81,386 million ¥ 80,390 million Reference : Equity As of June 30 , 2026 : As of March 31 , 2026 : -1-
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―2― 2. Cash dividends Annual dividends per share First quarter-end Second quarter-end Third quarter-end Fiscal year-end Total Yen Yen Yen Yen Yen Fiscal year ended - 10.00 - 10.00 20.00 March 31, 2026 Fiscal year ending - March 31, 2027 Fiscal year ending March 31, 2027 (Forecast) 10.00 - 10.00 20.00 Note: Revisions to the forecast of cash dividends most recently announced: None 3. Consolidated financial result forecasts for the fiscal year ending March 31, 2027 (from April 1, 2026 to March 31, 2027) (Percentages indicate year-on-year changes.) Net sales Operating profit Ordinary profit Profit attributable to owners of parent Basic earnings per share Millions of yen % Millions of yen % Millions of yen % Millions of yen % Yen Six months ending September 30, 2026 35,700 28.2 3,700 694.9 3,500 596.2 2,700 751.5 28.52 Full year 74,500 25.1 8,500 231.0 8,200 222.9 6,000 272.9 63.38 Note: Revisions to the financial result forecast most recently announced: Yes * Notes (1) Significant changes in the scope of consolidation during the period: None (2) Adoption of accounting treatment specific to the preparation of quarterly consolidated financial statements: None (3) Changes in accounting policies, changes in accounting estimates, and restatement (i) Changes in accounting policies due to revisions to accounting standards and other regulations: None (ii) Changes in accounting policies due to other reasons: None (iii) Changes in accounting estimates: None (iv) Restatement: None (4) Number of issued shares (common shares) (i) Total number of issued shares at the end of the period (including treasury shares) As of June 30, 2026 96,315,400 shares As of March 31, 2026 96,315,400 shares (ii) Number of treasury shares at the end of the period As of June 30, 2026 1,648,612 shares As of March 31, 2026 1,648,611 shares (iii) Average number of shares outstanding during the period (cumulative from the beginning of the fiscal year) Three months ended June 30, 2026 94,666,788 shares Three months ended June 30, 2025 94,723,835 shares * Review of the Japanese-language originals of the attached consolidated quarterly financial statements by certified public accountants or an audit firm: Yes (voluntary)
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―3― * Explanation of the proper use of financial results forecasts and other notes The financial results forecasts and other forward-looking statements contained herein are based on information currently available to the Company and certain assumptions deemed reasonable by the Company. These statements do not represent a guarantee from the Company that it will achieve such results. Supplementary information regarding the financial results will be posted on our website https://www.hds.co.jp on August 7, 2026. Change in the unit of presentation for monetary amounts Amounts of accounts and other items presented in our condensed quarterly consolidated financial statements were previously stated in thousands of yen, but effective from the first quarter ended June 30, 2026 , the company has changed to present such amounts in millions of yen. In order to facilitate comparison, the amounts for the previous consolidated fiscal year and the first quarter of the previous consolidated fiscal year are also presented in millions of yen.
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―4― Quarterly Consolidated Financial Statements Quarterly Consolidated Balance Sheet (Millions of yen) As of March 31, 2026 As of June 30, 2026 Assets Current assets Cash and deposits 21,564 22,074 Notes receivable - trade 3,744 4,291 Accounts receivable - trade 11,566 11,495 Securities 117 90 Merchandise and finished goods 1,901 1,968 Work in process 4,300 4,977 Raw materials and supplies 6,203 6,444 Other 1,672 1,930 Allowance for doubtful accounts (23) (21) Total current assets 51,048 53,250 Non-current assets Property, plant and equipment Buildings and structures, net 17,166 16,925 Machinery, equipment and vehicles, net 12,713 12,277 Tools, furniture and fixtures, net 1,375 1,369 Other, net 13,999 13,933 Total property, plant and equipment 45,256 44,506 Intangible assets Software 704 948 Customer related assets 9,187 9,073 Technical assets 2,453 2,423 Other 260 26 Total intangible assets 12,605 12,471 Investments and other assets Investment securities 390 853 Shares of subsidiaries and associates 0 - Investments in capital of subsidiaries and associates 73 72 Long-term loans receivable from subsidiaries and associates 304 297 Retirement benefit asset 1,488 1,502 Deferred tax assets 97 112 Other 141 147 Allowance for doubtful accounts (5) (5) Total investments and other assets 2,490 2,980 Total non-current assets 60,352 59,957 Total assets 111,400 113,208
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―5― (Millions of yen) As of March 31, 2026 As of June 30, 2026 Liabilities Current liabilities Notes and accounts payable - trade 2,393 3,028 Short-term borrowings 2,204 1,704 Current portion of long-term borrowings 1,890 1,890 Lease liabilities 834 836 Income taxes payable 354 658 Provision for bonuses 1,173 764 Provision for bonuses for directors (and other officers) 84 119 Provision for loss on compensation for after-care of products 176 204 Other 3,161 4,502 Total current liabilities 12,273 13,711 Non-current liabilities Long-term borrowings 9,125 8,652 Lease liabilities 4,011 3,807 Deferred tax liabilities 3,969 4,139 Provision for retirement benefits for directors (and other officers) 30 3 Other provisions 159 139 Retirement benefit liability 986 938 Other 453 429 Total non-current liabilities 18,735 18,110 Total liabilities 31,009 31,821 Net assets Shareholders' equity Share capital 7,100 7,100 Capital surplus 22,753 22,753 Retained earnings 38,765 39,093 Treasury shares (6,334) (6,334) Total shareholders' equity 62,284 62,611 Accumulated other comprehensive income Valuation difference on available-for-sale securities 23 262 Foreign currency translation adjustment 18,065 18,498 Remeasurements of defined benefit plans 17 13 Total accumulated other comprehensive income 18,106 18,774 Total net assets 80,390 81,386 Total liabilities and net assets 111,400 113,208
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―6― Quarterly Consolidated Statements of Income and Comprehensive Income Quarterly Consolidated Statement of Income For the Three-Month Period (Millions of yen) For the three months ended June 30, 2025 For the three months ended June 30, 2026 Net sales 13,496 16,681 Cost of sales 9,667 10,749 Gross profit 3,828 5,931 Selling, general and administrative expenses 3,706 4,090 Operating profit 122 1,840 Non-operating income Interest income 96 53 Dividend income 1 2 Other 59 52 Total non-operating income 158 107 Non-operating expenses Interest expenses 68 77 Share of loss of entities accounted for using equity method 13 5 Foreign exchange losses 23 96 Other 42 49 Total non-operating expenses 148 228 Ordinary profit 131 1,719 Extraordinary income Gain on sale of non-current assets 0 2 Gain on sale of investment securities 85 - Total extraordinary income 86 2 Extraordinary losses Loss on sale of non-current assets 0 - Loss on retirement of non-current assets 3 15 Total extraordinary losses 3 15 Profit before income taxes 214 1,706 Income taxes - current 108 427 Income taxes - deferred 143 4 Total income taxes 252 431 Profit (loss) (38) 1,274 Profit attributable to non-controlling interests - - Profit (loss) attributable to owners of parent (38) 1,274
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―7― Quarterly Consolidated Statement of Comprehensive Income For the Three-Month Period (Millions of yen) For the three months ended June 30, 2025 For the three months ended June 30, 2026 Profit (loss) (38) 1,274 Other comprehensive income Valuation difference on available-for-sale securities (122) 238 Foreign currency translation adjustment (894) 433 Remeasurements of defined benefit plans, net of tax (13) (3) Total other comprehensive income (1,030) 668 Comprehensive income (1,068) 1,942 Comprehensive income attributable to Comprehensive income attributable to owners of parent (1,068) 1,942 Comprehensive income attributable to non-controlling interests - -