Consolidated Financial Results
for the First Quarter of the Fiscal Year Ending September 30, 2019 (FY9/19)(Three Months Ended December 31, 2018)
February 14, 2019
Company name:
Evolable Asia Corp.
Stock Exchange Listing:
TSE 1stStock Code:6191
URL
http://www.evolableasia.com
Representative:
Hideaki Yoshimura, CEOContact:
Yusuke Shibata, Representative Director and CFO
TEL: +81-(0)3-3431-6191
Scheduled date of filing of Quarterly Report: February 14, 2019
Scheduled date of payment of dividend:－
Preparation of supplementary materials for quarterly financial results: Yes
Holding of quarterly financial results briefing: Yes (for institutional investors and securities analysts)(All amounts are rounded down to the nearest million yen)

1. Consolidated Financial Results for the First Quarter (October 1, 2018 to December 31, 2018) of FY9/19(1) Consolidated results of operations(Percentages represent year–on–year changes.)
OperatingincomeNet sales

Three months ended Dec.
31, 2018
Three months ended Dec.
31, 2017

Profit before
income taxes

ProfitProfit attributable to Total comprehensive
owners of parent
incomeMillions
Millions%%%of yenof yenMillionsof yen%Millionsof yen%Millionsof yen%Millionsof yen

4,735

191.5

△245

―

△267

―

△213

―

△264

―

△222

―

1,624

―

129

―

128

―

102

―

67

―

96

―

Fully diluted profit per
share

Profit per share
Three months ended Dec.
31, 2018
Three months ended Dec.
31, 2017

Yen

Yen△14.80△14.80

3.94

3.79(2) Consolidated financial position
Total assets

Equity attributable toowners of parent

Total equity

Ratio of equity attributable toowners of parent

Millions of yen

Millions of yen

Millions of yen%

25,65824,929

5,973
5,557

5,549
5,176

21.6
20.7

As of Dec. 31, 2018
As of Sep. 30, 2018

2. Dividends
Dividend per share
1Q–end2Q–end3Q–endYear–end

Total

Yen

Yen

Yen

Yen

Yen

Fiscal year ended―
0.00
Sep. 30, 2018
Fiscal year ending―
Sep. 30, 2019
Fiscal year ending Sep. 30,
0.00
2019 (Estimated)
Note: Revision to the most recently announced dividend forecast: None

―

10.00

10.00

―

―

―

Evolable Asia Corp. plans to pay the year-end dividend for the fiscal year ending September 30, 2019, based on a dividend payout
ratio of approximately 20%. Evolable Asia Corp. will not disclose the dividend forecast since the full-year consolidated financial
forecasts are not disclosed due to the difficulty of making reasonable estimates.

―1―

* Notes(1) Changes in significant subsidiaries during the period (changes in specified： Nonesubsidiaries resulting in changes in scope of consolidation)
Newly included:– companies– companies

Excluded:(2) Changes in accounting policies and accounting–based estimates, and restatements
1) Change of the accounting policy required under IFRS

： None2) Changes in accounting policies other than (i) above： None3) Changes in accounting–based estimates： None(3) Numbers of outstanding shares (common stock)1) Number of shares outstanding as of the end of the period
As of Dec. 31, 201818,141,500

As of Sep. 30, 2018

17,708,0002) Number of treasury shares as of the end of the period

As of Dec. 31, 2018―

As of Sep. 30, 2018―

3) Average number of shares issued during the period

Three months ended(including treasury shares)Three months ended
17,859,635

Dec. 31, 201817,198,651
Dec. 31, 2017

* The current quarterly financial report is exempt from the quarterly review procedures performed by certified public accountants or
audit corporations.
* Explanation of appropriate use of earnings forecasts, and other special items
Consolidated financial forecasts for the current fiscal year are not presented due to the difficulty of calculating reasonable forecasts.
For the reasons for this, see “Outlook” on page 5 of the Consolidated Financial Results for the Fiscal Year Ended September 30, 2018
(FY9/18) announced on November 13, 2018.

―2―

○Contents of Attachments
1. Qualitative Information on Quarterly Consolidated Financial Performance………………………………………………4(1) Explanation of Results of Operations.……………………………………………………………………………………4(2) Explanation of Financial Position.………………………………………………………………………………..………5(3) Explanation of Consolidated Forecast and Other Forward-looking Statements………………………….………………6
2. Condensed Consolidated Financial Statements and Notes to the Condensed Consolidated Financial Statements.………7(1) Condensed Consolidated Statement of Financial Position.………………………………………………………………7(2) Condensed Consolidated Statement of Income and Condensed Consolidated Statement of Comprehensive Income.….8(3) Condensed Consolidated Statement of Changes in Equity.…………………………………………………………..…10(4) Condensed Consolidated Statement of Cash Flows.………………………………………………………………….…11(5) Notes to Condensed Consolidated Financial Statements.………………………………………………………….……12(Notes on going concern assumptions)…………………………………………………………….…………………12(Significant changes in shareholders’ equity) ...……………………………………………………………..………12(Segment information, etc.) .......…………………………………………………………………………..............…12(Important subsequent events)…………………………………………………………………………………......…13―3―

1. Qualitative Information on Quarterly Consolidated Financial Performance(1) Explanation of Results of Operations
Evolable Asia Corp. (hereinafter the “Company”) and its consolidated subsidiaries (hereinafter collectively the “Group”)
disclosed consolidated financial statements in accordance with IFRS starting from previous fiscal year, and the figures for the first
three months of the previous fiscal year have also been restated according to IFRS for comparative analysis.
During the first quarter under review, the global economy maintained a robust performance mainly driven by advanced
economies. However, the global economic outlook became increasingly uncertain amid trade tensions between the US and China.
The Japanese economy remained on a moderate recovery path, reflecting steady improvement in employment and income
conditions. The economy continued to expand at a solid pace, supported by increased domestic demand and inbound tourist
demand against the background of the upcoming Tokyo Olympics in 2020 and EXPO 2025 in Osaka.
In the travel industry, the number of Japanese citizens who left Japan in the period from January to December 2018 totaled
18,950,000, increasing about 1,060,000 from the same period of the previous fiscal year according to the statistics released by theJapan National Tourism Organization (JNTO). In addition, the number of foreigners who visited Japan from January to December
2018 surpassed 31,190,000. The number is rising steadily toward 40 million, the target for 2020 set in the Tourism Vision to
Support the Future of Japan, which the Japanese government adopted in March 2016.
Under these conditions, the Company continued expanding its operations by seeking to diversify its service lines with a focus
on sales of domestic airline tickets and international airline tickets as an online travel agency and significantly investing inadvertising to raise recognition of its main brand AirTrip. The Company also continued to enhance its services for foreign visitors
to Japan, making the most of its online travel business expertise.
In the IT Offshore Development Business, which was launched in 2012, the Company steadily won customers in numerous
business categories and increased the number of engineers employed, focusing on the development of lab–type facilities inVietnam. The number of engineers hired grew to 1,000 as of the end of December 2018. In the Investment Business, which has
been developing in earnest since the stock was listed, the Company has been investing in growing companies. As of the end of
December 2018, the Company has invested in 51 companies.
In this business environment, the Group achieved consolidated net sales of 4,735 million yen (up 191.5% year on year), a
consolidated operating loss of 245 million yen (compared to consolidated operating income of 129 million yen a year earlier), a
consolidated loss before income taxes of 267 million yen (compared to consolidated income before income taxes of 128 million
yen a year earlier), and a consolidated loss attributable to owners of parent of 264 million yen (compared to consolidated income
attributable to owners of parent of 67 million yen a year earlier) in the first three months of the fiscal year under review.
In the first quarter under review, the Group posted an operating loss, reflecting strategic investments made to increase
recognition of the AirTrip brand. However, the Group expects to achieve income growth on a full-year basis.
Operating results by segment are as follows.
(1) Online Travel Agency Business
The Group offers the following four services in the Online Travel Agency Business segment.
・BtoC services (operation of PC and smartphone websites for selling travel commodities directly to general consumers)
The Company made considerable upfront investments in mass marketing, including TV commercials and train advertising, toacquire new customers and build a stable customer base in the future. The Company also improved user interfaces to increase thenumber of repeat customers. These contributed to a steady increase in the number of service users.

The recognition of the Company’s brand AirTrip increased, and strategic pricing and the active input of branding costs wereconducted to acquire customers.
・BtoBtoC services (travel content provision under brands owned by business partners)
The enhanced development of alliances with major partners, the provision of services to match the needs of major partners, andenhanced communication with partners contributed to an increase in service use. In addition, like the BtoC services, measures formarketing and alliances with an emphasis on increasing customer numbers were promoted.
・BtoB services (wholesale to other travel agencies)―4―Net sales were solid, reflecting trends in the airline industry and policies enforced by business partners.
・BTM services (centralized management of internal approval procedures and arrangements associated with corporate businesstrips)
These services basically adopt a business model under which net sales expand in a manner that is linked with an increase in thenumber of corporate customers and a rise in their usage rate. The services achieved growth attributable to initiatives taken by theGroup, including the addition of salespeople and the identification of existing customers who used the services at a relatively low
rate.
・Services for foreign visitors（business of providing various BtoC services to visitors to Japan）
The Company offers various services for foreign visitors to Japan, including Wi-FI rental, camping car rental, currency
exchange and web media serves. In every business line, net sales and income grew steadily due to an increase in visitors to Japan,
multilingual customer service and stronger marketing.
As a result of the factors stated above, net sales for the Online Travel Agency Business segment amounted to 4,124 million yen,and segment loss came to 258 million yen in the fiscal year under review.
(2) IT Offshore Development BusinessIn the IT Offshore Development Business segment, the Group offers lab-type facility development services to customers
consisting mainly of e-commerce operators, web solution providers, and game and system developers in Ho Chi Minh, Hanoi and
Da Nang in Vietnam.
The Company’s lab-type facility development model is distinctive in that a team is formed with new dedicated staff members
hired for each customer. The model also enables customers to confirm the state of lab-type facility development on demand. The
Company assumes the assignment of dedicated staff members to each team on a medium- to long-term basis. For that reason, thesuccess or failure of development depends on employing workers suited to customer demands and motivating the respectiveengineers more.
In addition, these services basically adopt a business model under which customers are billed on the basis of man-months andthe number of workers. The number of engineers supplied to clients and the man-months affect net sales for them significantly.
An increase in the number of engineers and a rise in the unit cost due to development streamlining contributed to sales growth in
the fiscal year under review.
As a result of the factors stated above, net sales for the IT Offshore Development Business segment reached 611 million yen,and segment income totaled 91 million yen.
(3) Investment BusinessIn the Investment Business segment, the Group emphasizes synergies with the existing businesses and expands service lines
through aggressive M&A and capital alliances. The Group is pursuing investment in growing companies to improve profitability.
At the end of the fiscal year under review, the Group had increased the number of companies in which it invests to 51. As a result,net sales for the Investment Business segment stood at 0 million yen, and segment income was 97 million yen.

(2) Explanation of Financial Position(Assets)
Total assets increased 728 million yen from the end of the previous fiscal year, to 25,658 million yen at the end of the firstquarter under review. This result was mainly due to an increase of 808 million yen in cash and deposits.
(Liabilities)
Liabilities increased 313 million yen from the end of the previous fiscal year, to 19,684 million yen at the end of the firstquarter under review. This result primarily reflected an increase of 1,012 million yen in interest-bearing debt despite a decrease of
680 million yen in trade and other payables.
(Equity)
Net assets rose 415 million yen from the end of the previous fiscal year, to 5,973 million yen at the end of the first quarter
under review. This result was mainly attributable to an increase of 403 million yen in capital stock and a rise of 233 million yen in
share premium, despite a decrease in Retained earnings of 264 million yen.

―5―(3) Explanation of Consolidated Forecast and Other Forward-looking Statements
Consolidated financial forecasts for the current fiscal year are not presented due to the difficulty of calculating reasonable
forecasts as explained in the Consolidated Financial Results for the Fiscal Year Ended September 30, 2018 (FY9/18) announced
on November 13, 2018.

―6―

2. Condensed Consolidated Financial Statements and Notes to the Condensed Consolidated Financial Statements(1) Condensed Consolidated Statement of Financial Position(Millions of yen)First quarter of the fiscal year underreview(as of Dec. 31, 2018)

FY9/18(as of Sep. 30, 2018)
AssetsCurrent assets
Cash and cash equivalents
Notes and accounts receivable – tradeand other receivables
Other financial assets
Inventories

5,320

6,128

4,442

4,045

3,889

4,170

87

92

132

91

Other current assets

1,331

1,400

Total current assets

15,202

15,927

Property, plant and equipment

1,111

1,095

Goodwill

5,091

5,065

Intangible assets

2,302

2,415

Other financial assets

1,055

997

Other non–current assets

83

70

Deferred tax assets

82

86

9,726

9,730

24,92925,658Current liabilities
Operating payables and otheroperating payables
Interest–bearing debt

4,333

3,652

6,802

7,594

Other financial liabilities

428

386

Accrued income taxes

80

79

Other current liabilities

3,281

3,408

Total current liabilities

14,92615,121

Income taxes receivable

Non-current assets

Total non–current assets
Total assets
Liabilities and equity
Liabilities

Non–current liabilities
4,009

4,229

Other financial liabilities

61

64

Provisions

76

76

Deferred tax liabilities

288

183

8

8

Interest–bearing debt

Other non-current liabilities

4,444

4,563

19,371

19,684

Capital stock

1,100

1,504

Share premium

2,117

2,350

Retained earnings

1,953

1,689

Other items of equity
Total equity attributable to owners ofparentNon–controlling interests

5

5

5,176

5,549

380

423

Total equity

5,557

5,973

24,92925,658

Total non-current liabilities
Total liabilities
EquityTotal liabilities and equity―7―(2) Condensed Consolidated Statement of Income and Condensed Consolidated Statement of Comprehensive
IncomeCondensed Consolidated Statement of Income
For the Three-month Period(Millions of yen)Three months ended
December 31, 2017
(Oct. 1, 2017 – Dec. 31, 2017)

Three months ended
December 31, 2018
(Oct. 1, 2018 – Dec. 31, 2018)

Net sales

1,624

4,735

Cost of sales△490△1,988Gross profit

1,133

2,746

△1,129

3,086

124

105

Selling, general and administrative expense
Share of loss (profit) of entities
Other income

2

9

Other expenses

△0

△21

129

△245

Operating income (loss)
Finance income

32

Finance costs

△4

△24

Profit before income taxes (loss)

128

△267

Corporate income tax expenses

△25

54

Profit (loss)

102

△213

Profit attributable to
Owners of parent

67

△264

Non-controlling interests

34

51

102

△213

Profit (loss) per share

3.94△14.80Fully diluted profit (loss) per share

3.79△14.80

Profit per share―8―Condensed Consolidated Statement of Comprehensive Income
For the Three-month Period(Millions of yen)Three months ended
December 31, 2017
(Oct. 1, 2017 – Dec. 31, 2017)

Three months ended
December 31, 2018
(Oct. 1, 2018 – Dec. 31, 2018)

102

△213

Translation adjustments of foreign
operations
Cash flow hedge

△5

△8

0

△0

Total of items that may be reclassified as
profit or loss

△5

△9

Total of other comprehensive income, net of tax△5△9Comprehensive income

96

△222

Owners of parent

64

△269

Non–controlling interests

31

46

ProfitOther comprehensive income, net of tax

Comprehensive income attributable to―9―(3) Condensed Consolidated Statement of Changes in Equity
Three months ended December 31, 2017 (Oct. 1, 2017 – Dec. 31, 2017)(Millions of yen)
Equity attributable to owners of parent
Capital stock Capital surplus
As of October 1, 2017

Retainedearnings

Other items ofequity5

Total

Total equity

402

3,394

1,031

815

1,139

Profit

－

－

67

－

67

34

102

Other comprehensive income

－

－

－

△2

△2

△2

△5

Total comprehensive income

－

－

67

△2

64

31

96

Dividends of surplus

－

－

△118

－

△118

－

△118

Issuance of new shares

4

4

－

－

9

－

9

Increase (decrease) by shareexchanges
Increase (decrease) throughtransfers and other changes

－

809

－

－

809

△112

697

－

－

0

1

1

3

4

Total transactions with owners

4

813

△118

1

701

△109

592

1,035

1,629

1,088

4

3,758

325

4,084

As of December 1, 2017

2,992

Noncontrollinginterests

Three months ended December 31, 2018 (Oct. 1, 2018 – Dec. 31, 2018)(Millions of yen)
Equity attributable to owners of parent
Capital stock Capital surplus
As of October 1, 2018

Retainedearnings

Other items ofequityTotal

Noncontrollinginterests

Total equity

1,100

2,117

1,953

5

5,176

380

5,557

Profit

－

－

△264

－

△264

51

△213

Other comprehensive income

－

－

－

△5

△5

△4

△9

Total comprehensive income

－

－

△264

△5

△269

46

△222

Dividends of surplus

－

△177

－

－

△177

－

△177

Issuance of new shares

403

403

－

－

807

－

807

Increase (decrease) throughtransfers and other changes

－

7

－

4

11

△3

8

Total transactions with owners

403

233

－

4

642

△3

638

1,504

2,350

1,689

5

5,549

423

5,973

As of December 1, 2018―10―

(4) Condensed Consolidated Statement of Cash Flows(Millions of yen)Three months ended
Three months ended
December 31, 2017
December 31, 2018
(Oct. 1, 2017 – Dec. 31, 2017) (Oct. 1, 2018 – Dec. 31, 2018)
Cash flows from operating activities
Profit (loss) before tax
Depreciation and amortization expense
Investment income (loss)
Increase in allowance

128
59
△124
9

△267
211
△105
△70

(Increase) decrease in trade and other receivables

54

429

Increase (decrease) in trade and other payables

△501

△851

Decrease (increase) in accounts receivable-other
Increase (decrease) in guarantee deposits received
Decrease (increase) in investment securities for sale
Other
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities

75
△68
△279
158
△488
0
△7
△183
△678

64
14
△144
331
△388
2
△25
△44
△456

△36
△165
△47
23

△49
△343
△38
81

△355

―

0
△580

△61
△412

1,005

1,035

Cash flows from investing activities
Purchase of property, plant and equipment
Purchase of intangible assets
Payments for lease deposits
Collection of lease deposits
Purchase of shares of subsidiaries resulting inchange in scope of consolidation
Other
Net cash provided by (used in) investing activities
Cash flows from financing activities
Net increase (decrease) in short–term loans payable
Proceeds from long–term loans payable

900

700

Repayments of long–term loans payable

△33

△681

Proceeds from issuance of common shares
Dividends paid to owners of the parent company
Other
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

―11―

9

797

△117

△166

△1

△2

1,762

1,683

0

△6

504
2,078
2,583

808
5,320
6,128

(5) Notes to Condensed Consolidated Financial Statements(Notes on going concern assumptions)Not applicable.
(Significant changes in shareholders’ equity)
During the first three months of the fiscal year under review, exercise of the Second Series, Third Series, Fourth Series, Fifth
Series and Thirteenth Series of Stock Acquisition Rights caused shares outstanding to increase by 433,500 shares and caused
capital stock and share premium to each increase by 403 million yen.
(Segment information, etc.)(1) Summary of reportable segments
The Company’s reportable segments are its business units that have separate financial information available and that are
subject to periodical examinations by the Board of Directors for the purpose of determining the allocation of management
resources and evaluating performance.
Under its “One Asia” vision, the Group aims to serve as a bridge connecting various opportunities and engineers in Asia. With
the Online Travel Agency Business, IT Offshore Development Business and Investment Business as its three mainstay businesses,
the Group classifies these businesses, with their highly unique business models, as its main reportable business segments anddraws up and determine Group strategies accordingly.
The businesses and main products belonging to each reportable segment are as follows:
Online Travel Agency Business：Online general travel agency service
IT Offshore Development Business: Lab-type offshore development services and BPO services
Investment Business: Investment in growing companies and turnarounds(2) Calculation method of segment income (loss) and segment performance
The accounting process for the reportable business segments is the same as that used for the preparation of the condensed
consolidated financial statements.
Transactions between reportable segments are conducted based on the same general terms and conditions that apply to externalcustomers.
The Group does not allocate assets or liabilities to reportable segments.
(3) Information about segment income(loss) and segment performance
Three months ended December 31, 2017 (Oct. 1, 2017 – Dec. 31, 2017)(Millions of yen)
Reportable segments
OnlineIT Offshore
TravelInvestment
Developme
AgencyBusiness
nt BusinessBusiness

Total

Other
(Note 1)

Adjustme
Consolidatents
d Total(Note 2)

Total

External sales revenue

1,000

523

100

1,624

0

1,624

―

1,624

Intersegment revenue

―

40

―

40

―

40

△40

―

Total sales revenue

1,000

563

100

1,664

0

1,664

△40

1,624

67

64

115

248

―

248

△118

129

Segment profits (losses)(Note 3)Financial income

3

Financial expenses△4

Incometaxes

beforeincome128(Note 1) The category “Other” includes the business segments not included in the reportable segments, such as advertising
revenue.

―12―

(Note 2) The category “Adjustments” mainly consists of corporate expenses that do not belong to any reportable segment
and intersegment transactions.
(Note 3) The segment profit or loss has been adjusted to the operating income stated in the quarterly consolidated statementof income.

Three months ended December 31, 2018 (Oct. 1, 2018 – Dec. 31, 2018)(Millions of yen)
Reportable segments
OnlineIT Offshore
TravelInvestment
Developme
AgencyBusiness
nt BusinessBusiness

Total

Other
(Note 1)

Total

Adjustme
Consolidatents
d Total(Note 2)External sales revenue

4,124

611

0

4,735

0

4,735

－

4,735

Intersegment revenue

16

108

－

124

－

124

△124

－

Total sales revenue

4,140

719

0

4,860

0

4,860

△124

4,735

Segment profits (losses)(Note 3)

△258

91

97

△70

△0

△70

△175

△245

Financial income

2

Financial expenses△24

Incometaxes

beforeincome△267(Note 1) The category “Other” includes the business segments not included in the reportable segments, such as advertising
revenue.
(Note 2) The category “Adjustments” mainly consists of corporate expenses that do not belong to any reportable segment
and intersegment transactions.
(Note 3) The segment profit or loss has been adjusted to the operating income stated in the quarterly consolidated statementof income.
(Important subsequent events)
Not applicable.

―13―