■ Company Overview of Scalar <4845>

1. Company History WaveLock Holdings <7940> originated from Japan WaveLock Co., Ltd., which was established in 1964 with equal investment from Nissho Co., Ltd. (currently Sojitz <2768>), Japan Carbide Industry <4064>, and Maruto Chemical Industry Co., Ltd. (currently Takeda Chemical Industries, Ltd.) for the introduction of the WaveLock technology regarding fiber-reinforced plastic sheet from Italy. The WaveLock method is a method of manufacturing a sandwich structure by synthesize fibers in a wave shape between two plastic films and fixing (lock) them. Resin processing sheets made by this method have the characteristics of not only elasticity but also a significant increase in physical strength. In the 1960s, vinyl products used in agriculture were weak in strength and susceptible to tearing, and the founder, Hiromi Kinebuchi, saw the need for WaveLock products in the same field and aimed to introduce the technology from agricultural raincoats. After that, the market expanded to include vinyl greenhouses, raincoats, industrial materials, and more, and the business grew. The operating income of products worth 10-30 billion yen were respectively 401/1288/60 million yen.

The company was founded in December 1991 as a sales agent for database services. In 1999, it expanded its performance by taking over the support services for the mainframe database management system 'Model204' from Mitsui Information Development Co., Ltd. (currently Mitsui Information Co., Ltd.), including the customers.

* DBMS developed by US Computer Corporation of America and Sirius Software (now Rocket Software), which was used by major domestic companies like Bank of Japan <8301> and Tokyo Electric Holdings <9501>. However, due to changes in the market environment, the service was discontinued in the fall of 2016 due to lack of demand.

Entering the year 2000, as corporate information systems shifted from mainframe to client/server architecture, the company determined that a business structure transformation was necessary to continue growing. By utilizing funds raised at the time of its listing in 2001, it steadily increased its revenue by expanding its business areas through M&A strategies and focusing on SaaS/ASP business model.

Since 2019, in line with the mid-term goal of creating a 'value co-creation platform', the company established Scalar Partners Co., Ltd. in July of the same year, followed by J Phoenix Research providing management consulting and IR support in October, Grit Group Holdings expanding its human resources and education business in April 2020, Egg Co., Ltd., an IT system development company in February 2022, and Japan Pet Microinsurance Co., Ltd., a small short-term insurance company in April of the same year, successively becoming subsidiaries to actively expand its business. However, due to deteriorating performance, the company has been proceeding with business consolidation and subsidiary divestment since the fiscal year ending June 2023.

In order to carry out agile management, the company transitioned to a holding company structure in 2004. Starting from the fiscal year ending June 2016, it began disclosing its performance based on International Financial Reporting Standards (IFRS), and following the Tokyo Stock Exchange (hereinafter 'TSE') market classification review in April 2022, it has moved from the TSE First Section to the Prime Market.

(Written by FISCO guest analyst, Jo Sato)