Summary of Financial Statements
for Fiscal Year Ended March 31, 2019 [Japanese GAAP](Consolidated)
May 10, 2019
Name of listed company:

SHIP HEALTHCARE HOLDINGS, INC.
Shares listed on: Tokyo Stock Exchange
Code:
3360
URL
http://www.shiphd.co.jp/
Representative:(Title) Chairman and CEO(Name) Kunihisa Furukawa
Contact:(Title) Managing Director(Name) Hiroshi YokoyamaTel.: +81-6-6369-0130
Scheduled date for regular general meeting of shareholders: June 27, 2019
Scheduled start date for dividend payments: June 28, 2019
Scheduled date for filing securities report: June 27, 2019
Supplementary briefing materials on results: Y
Briefing on results:
Y (for institutional investors and analysts)(All figures are rounded down to the nearest million yen.)

1. Consolidated financial results for the fiscal year ending March 31, 2019
(April 1, 2018–March 31, 2019)(1) Consolidated operating results(Percentages represent year-on-year changes.)

Net sales(Millions yen)

Operating profit%(Millions yen)%

(Millions yen)

FY ended March 2019
444,048
4.3
17,952(1.7)
FY ended March 2018
425,566
4.2
18,25913.7
Note: Comprehensive income: FY ended March 2019: ¥11,666 million (3.2%);
FY ended March 2018: ¥11,304 million (15.6%)
Net income per
Diluted net
Return on
income per shareequityshare(Yen)Profit attributable toowners of parent

Ordinary profit(Yen)

18,532
18,935%(Millions yen)

%

(2.1)
14.9

11,236
10,3508.6
10.0

Return on
assets%Operatingmargin%%FY ended March 2019
227.75221.11
11.5
6.3
4.0
FY ended March 2018
204.57
–
10.8
6.9
4.3
Reference: Share of profit (loss) of entities accounted for using equity method: FY ended March 31, 2019: ¥67 million;
FY ended March 31, 2018: ¥34 million(2) Consolidated financial condition
Total assets

Net assets(Millions yen)

Equity capital ratio(Millions yen)

Net assets per share
%

(Yen)

FY ended March 2019299,21297,73431.9
FY ended March 2018
285,181
102,354
35.0
Reference: Equity: FY ended March 2019: ¥95,420 million; FY ended March 2018: ¥99,880 million

2,003.36
1,973.95(3) Consolidated cash flows
Net cash fromoperating activities
FY ended March 2019
FY ended March 2018

Net cash frominvesting activities

Net cash fromfinancing activities

Cash and cash
equivalents at end of
period(Millions yen)

(Millions yen)

(Millions yen)

(Millions yen)

10,53420,204(7,678)(6,640)9,828(3,347)71,49458,787

2. Dividends
End Q1
FY ended March 2018
FY ended March 2019
FY ending March 2020
(forecast)

Annual dividends
End Q2End Q3 Year-end

Total

Total annual Payout ratio Dividends to
net assets
dividends (consolidated) (consolidated)

(Yen)

(Yen)

(Yen)

(Yen)

(Yen)

(Millions yen)

%

%

–
–

0.00
0.00

–
–

64.00
70.00

64.00
70.00

3,238
3,334

31.3
30.7

3.4
3.5

–

0.00

–

75.00

75.00

30.3

3. Forecast of consolidated financial results for fiscal year ending March 31, 2020 (April 1, 2019–March
31, 2020)(Percentages represent changes from previous year for full-year figures and year-on-year changes for quarterly figures.)
Profit attributable
Net income
Net sales
Operating profit
Ordinary profit
to owners ofper share
parentCumulative throughsecond quarter
Full-year(Millions yen)%

(Millions yen)%

(Millions yen)%

(Millions yen)

%

(Yen)

210,000

3.9

6,500

3.7

7,000

6.0

4,000

0.1

83.98

466,000

4.9

18,5003.1

19,3004.1

11,8005.0

247.74Notes(1) Changes affecting significant subsidiaries during period under review (changes affecting
specific subsidiaries accompanied by changes affecting the scope of consolidation):

None(2) Changes made in accounting policies, accounting estimates, and/or restatements(i) Changes in accounting policies associated with changes in accounting standards, etc.:(ii) Any changes in accounting policies other than those under (i) above:(iii) Changes in accounting estimates:(iv) Restatements:

None
None
None
None

(3) Number of shares issued and outstanding (common shares)(i) Number of shares issued andFY ended MarchFY ended March
50,834,700 shares
outstanding at the end of the period
2019
2018
(including treasury shares)(ii) Number of treasury shares at the end of FY ended March 3,204,535 shares FY ended March
2019
2018
the period(iii) Average number of shares during the
FY ended MarchFY ended March
49,335,752 shares
2019
2018
period50,834,700 shares

235,568 shares

50,599,132 shares

Reference: Overview of non-consolidated financial results
1. Non-consolidated financial results for fiscal year ended March 31, 2019 (April 1, 2018–March 31,
2019)(1) Non-consolidated operating results
Operating revenues
FY ended March 2019
FY ended March 2018

(Millions yen)%

(Millions yen)%

(Millions yen)%

(Millions yen)

%

7,046
6,504

8.3
5.5

5,884
5,367

9.6
4.8

5,856
5,319

10.1
5.4

5,745
5,188

10.7
5.1

Net income per share
FY ended March 2019
FY ended March 2018

(Percentages represent year-on-year changes.)
Ordinary profit
Net income

Operating profit

Diluted net income per
share

(Yen)

(Yen)

116.46102.55113.01–(2) Non-consolidated financial condition
Total assets
FY ended March 2019
FY ended March 2018

Net assets

Equity capital ratio

Net assets per share(Millions yen)

(Millions yen)

%

(Yen)

81,15671,921

45,232
55,19255.7
76.7

949.65
1,090.79

Reference: Equity: FY ended March 31, 2019: ¥45,232 million; FY ended March 31, 2018: ¥55,192 million* This summary of financial statements is not subject to audits by a certified public accountant or audit firm.
* Information on appropriate use of financial forecasts and other special notes• The forecasts of financial results and other forward-looking statements provided herein are based on
information available at the time this document was prepared and certain assumptions consideredreasonable. Actual results may differ significantly from forecasts due to various factors. For assumptions
underlying forecasts of financial results, notes on use of forecasts of financial results, and other related
information, see “Future outlook” on page 5 of the Annexed Materials.
• The Company is a holding company and the bulk of its revenue consists of dividends received fromsubsidiaries and revenues from their operating costs. Detailed information on non-consolidated financial
forecasts is omitted since information is not important for investment information and business indicators.

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019 Index of attached materials

1.

Qualitative information on business results ...................................................................................................... 2(1)

Description of business results ................................................................................................................ 2(2)

Analysis of financial position .................................................................................................................. 3(3)

Analysis of cash flows ............................................................................................................................. 4(4)

Future outlook ......................................................................................................................................... 5

2.

Basic approach in selecting accounting standards ............................................................................................ 53.

Consolidated financial statements and notes thereto ........................................................................................ 6(1)

Consolidated balance sheet ...................................................................................................................... 6(2)

Consolidated statement of income and consolidated statement of comprehensive income ..................... 8(3)

Consolidated statement of changes in equity ..........................................................................................11(4)

Consolidated statement of cash flows .................................................................................................... 13(5)

Notes on consolidated financial statements ........................................................................................... 15(Notes on the going concern assumption) .............................................................................................. 15(Change of presentation method ) .......................................................................................................... 15(Segment information, etc.) ................................................................................................................... 15(Per-share information) .......................................................................................................................... 20(Important subsequent information)....................................................................................................... 21

1

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019

1. Qualitative information on business results(1) Description of business results
The Japanese economy maintained a course of gentle recovery during the current consolidated fiscal year, with improved
employment conditions and steady growth in personal income, both backed by strong corporate earnings. However, theeconomic outlook remains uncertain for reasons including China’s economy slowing down due to US-China trade
frictions.
Within the healthcare industry in which the Group operates, a reform of the healthcare system is underway against a
backdrop of ever-increasing healthcare costs due to low birthrates and an aging society. The revised medical service feesthat went into effect in April of last year resulted in an overall reduction. Particularly, reductions in drug prices andreimbursement prices dealt a significant blow to entire affected industries.
Under these economic conditions, the Group’s Total Pack Produce Business made progress on several projects consistent
with initial plans, while the Life Care Business maintained a steady course, achieving occupancy rates of at least 98 percent. However, despite efforts to win renewals of existing projects, the performance of the manufacturing businesses fell
short of plans.
Despite the influence of revised drug and reimbursement prices, thanks to efforts to improve managerial efficiency and to
win new projects, the Medical Supply Business and the Dispensing Pharmacy Business made steady progress.
Initial opening expenses were calculated the Osaka Heavy Ion Therapy Center, which opened last March and beganproviding treatment in October of the same year. The number of acceptable patients exceeded initial expectations, due tothe inclusion of specific cancer treatment areas such as prostate cancer in medical insurance coverage.
During this consolidated fiscal year, the various factors noted above resulted in net sales of 444,048 million yen (up 4.3%
YoY), operating profits of 17,952 million yen (down 1.7% YoY), ordinary profits of 18,532 million yen (down 2.1% YoY),
and profits attributable to owners of parent of 11,236 million yen (up 8.6% YoY).
Business results by segment are summarized below.
(i) Total Pack Produce businessIn the Total Pack Produce Business, despite increased depreciation costs for medical equipment due to the start oftreatment at the Osaka Heavy Ion Therapy Center, projects made progress consistent with plans. On the other hand,conditions for the manufacturing businesses remained difficult.
As a result, this segment recorded net sales of 99,411 million yen (up 1.4% YoY) and segment profit (operating
profit) of 9,794 million yen (down 3.5% YoY).
(ii) Medical Supply business
The Medical Supply Business demonstrated strong performance, thanks to improvements in operational efficiency at
SPD facilities and other efforts. This was despite difficulties in securing profits on sales of specified health andmedical materials due to the impact of revised reimbursement prices.
As a result, this segment recorded net sales of 290,363 million yen (up 5.9% YoY) and segment profit (operating
profit) of 4,191 million yen (up 0.7% YoY).
(iii) Life Care businessDespite revised nursing care fees, the Life Care business demonstrated strong performance. The number of tenants
grew, driven by thoroughgoing personnel training and a promotional campaign to acquire tenants using Sanrio
characters in partnership with Sanrio Company, Ltd. and other efforts.
As a result, this segment recorded net sales of 23,500 million yen (up 3.4% YoY) and segment profit (operating
profit) of 1,625 million yen (up 70.2% YoY).
(iv) Dispensing Pharmacy business
While we continued to make managerial improvements involving small-scale M&A activities, realignments within
the Group, and so forth, conditions for the Dispensing Pharmacy business remained difficult due to the impact ofrevised dispensing fees.
As a result, this segment recorded net sales of 25,585 million yen (down 0.8% YoY) and segment profit (operating
profit) of 2,193 million yen (down 22.4% YoY).
(v) Other businesses
In other businesses, the operation of veterinary hospitals and the security support company demonstrated strong
performance.
As a result, this segment recorded net sales of 5,157 million yen (up 4.6% YoY) and segment profit (operating profit)of 421 million yen (up 38.9% YoY).

2

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019(2) Analysis of financial position(i) Current assets
The balance of current assets at the end of this consolidated fiscal year stood at 201,571 million yen (vs. a balance of
191,448 million yen at the end of the previous consolidated fiscal year), an increase of 10,123 million yen since theend of the previous consolidated fiscal year.
Major reasons included increases of 12,749 million yen in cash and deposits, 958 million yen in merchandise andfinished goods, despite decrease of 1,115 million yen in notes and accounts receivable – trade.
(ii) Non-current assets
The balance of non-current assets at the end of this consolidated fiscal year stood at 97,640 million yen (vs. a balanceof 93,732 million yen at the end of the previous consolidated fiscal year), an increase of 3,907 million yen since theend of the previous consolidated fiscal year.
Major reasons included increases of 6,821 million yen in investment securities and 4,170 million yen in machinery,equipment and vehicles, despite decrease of 3,192 million yen in construction in progress, 1,346 million yen in
goodwill and 1,105 million yen in land.
(iii) Current liabilities
The balance of current liabilities at the end of this consolidated fiscal year stood at 128,176 million yen (vs. a balanceof 137,925 million yen at the end of the previous consolidated fiscal year), a decrease of 9,748 million yen since theend of the previous consolidated fiscal year.
Major reasons included decreases of 3,345 million yen in notes and accounts payable – trade, 1,940 million yen in
short-term loans and 1,013 million yen in electronically recorded obligations – operating.
(iv) Non-current liabilities
The balance of non-current liabilities at the end of this consolidated fiscal year stood at 73,300 million yen (vs. abalance of 44,900 million yen at the end of the previous consolidated fiscal year), an increase of 28,399 million yen
since the end of the previous consolidated fiscal year.
Major reasons included increases of 25,116 million yen in bonds with share acquisition rights and 2,935 million yen
in long-term loans.
(v) Net assets
The balance of net assets at the end of this consolidated fiscal year stood at 97,734 million yen (vs. a balance of
102,354 million yen at the end of the previous consolidated fiscal year), a decrease of 4,620 million yen since the endof the previous consolidated fiscal year.
Major reasons 12,999 million yen in acquisition of treasury stock and decreases of 3,238 million yen in retained
earnings due to payment of dividends, despite increases of 11,236 million yen in retained earnings from profit
attributable to owners of parent and 482 million yen in valuation differences on available-for-sale securities

3

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019(3) Analysis of cash flows
The balance of cash and cash equivalents at the end of this consolidated fiscal year stood at 71,494 million yen, up 12,706
million yen from the balance of 58,787 million yen at the end of the previous consolidated fiscal year.
(i) Cash flow from operating activities
Cash flow from operating activities was 10,534 million yen (down 9,670 million yen compared to the previous
consolidated fiscal year). Major contributing factors included the recording of 18,490 million yen in profit before
income taxes, and recording of 2,842 million yen in depreciation expenses and 1,661 million yen in amortization of
goodwill, despite payment of 7,745 million yen in income taxes and a decrease of 4,367 million in notes and accounts
payable – trade.
(ii) Cash flow from investing activities
Cash flow used in investing activities was 7,678 million yen (up 1,037 million yen compared to the previous
consolidated fiscal year). Major contributing factors included expenditures of 6,097 million yen on purchase ofinvestment securities and 2,767 million yen on purchase of property, plant, and equipment, despite gains of 1,618
million yen from sales of property, plant, and equipment.
(iii) Cash flow from financing activities
Cash flow provided in financing activities was 9,828 million yen (for an increase in proceeds of 13,176 million yen
compared to the previous consolidated fiscal year). Major contributing factors included gains of 25,087 million yen
on issue of bonds and 8,000 million yen from long-term loans, despite expenditures of 12,999 million yen inacquisition of treasury stock, 4,771 million yen on repayment of long-term loans and 3,238 million yen on dividend
payments.
Reference: Trends in cash flow indices
FY ended
March 2015
Equity capital ratio (%)

37.2

FY ended
March 2016

FY ended
March 201737.1

Mark-to-market equity
66.9
64.1
capital ratio (%)
Years of debt redemption
22.8
2.3(years)Interest coverage ratio
4.8
57.3(times)* Equity capital ratio = equity capital/total assets
Mark-to-market equity capital ratio = total market capitalization/total assets
Years of debt redemption = interest-bearing debt/operating cash flows
Interest coverage ratio = operating cash flows/interest paid

FY ended
March 2018

FY ended
March 2019

34.7

35.0

31.9

56.9

66.5

72.3

3.1

2.3

6.8

53.3

80.6

40.9

Notes:
1. All indices are calculated from consolidated-basis financial data.
2. Total market capitalization is calculated by multiplying the closing stock price at the end of the fiscal year by total numberof shares issued and outstanding (after subtracting treasury stock) as of the end of the fiscal year.
3. Calculations of operating cash flows are based on cash flows from operating activities on the Consolidated Cash Flow
Statement. Interest-bearing debt consists of all debt on the Consolidated Balance Sheet for which interest is paid. The
amount of interest paid is based on interest paid as shown on the Consolidated Cash Flow Statement.

4

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019

(4) Future outlook
As the baby boom generation ages and low birth rates continue, projections indicate Japan will continue to see restraints
on remuneration for medical and nursing care costs, and reductions in their price. In addition, since the enactment of the
Act for Securing Comprehensive Medical and Long-term Care in the Community, progress is being made to develop
comprehensive community care systems through continuing reforms in the structure of providing medical care, withcompletion envisioned for 2025.
Given these conditions and drawing on advanced capabilities in delivering integrated and optimal solutions in medicine,
healthcare, welfare, nursing care, and services, the Group will seek to contribute to society by meeting a wide range ofneeds based on the SHIP philosophy and Group mission to create environments for those seeking to save lives.
The Group has formulated “SHIP Vision 2020,” its medium-term management plan for the fiscal years 2018–2020 endingin March 2021, the final year of the plan.
In the FY ending March 2019, the Group’s heavy ion radiotherapy facility and the hospital management busness in
Bangladesh commenced full-fledged operations. The Group’s medium-term plan calls for record highs in both net sales
and operating profit in FY ending March 2021, the plan’s final year. The specific targets are 500 billion yen and 21 billion
yen, respectively.
The business performance projected for the next fiscal year (FY ending March 2020) is summarized below.
<Projected consolidated results>
FY ending March 2020 (projected)
Profit margin

YoY change(Unit: Millions yen, %)FY ended March 2019 (actual)
Profit margin

Net sales

466,600–

4.9

444,048–

Operating profit

18,5004.0

3.1

17,952

4.0

Ordinary profit

19,300

4.1

4.1

18,532

4.2

11,236

2.5

Profit attributable to owners
11,8002.5
5.0
of patent
The projected amount of (year-end) dividends per share in FY ending March 2020 is 75 yen.

2. Basic approach in selecting accounting standards
To facilitate comparisons from period to period and between entities, the Group for the time being will continue to prepare
its consolidated financial statements based on J-GAAP.
The Group will duly address the application of International Financial Reporting Standards (IFRS) after taking into accountvarious circumstances both in Japan and abroad.

5

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019

3. Consolidated financial statements and notes thereto(1) Consolidated balance sheet(Unit: Millions yen)March 31, 2019

March 31, 2018
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Electronically recorded monetary claims - operating
Lease investment assets
Merchandise and finished goods
Work in process
Raw materials and supplies
Short-term loans
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant, and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Machinery, equipment and vehicles
Accumulated depreciation
Machinery, equipment and vehicles, net
Land
Assets for rent
Accumulated depreciation
Assets for rent, net
Real estate for rent
Accumulated depreciation
Real estate for rent, net
Construction in progress
Other
Accumulated depreciation
Other, net
Total property, plant, and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Long-term loans
Net defined benefit assets
Deferred tax assets
Claims provable in bankruptcy, claims provable in rehabilitation and other

Guarantee deposits
Other
Total allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

6

59,64499,0903,427
3,873
13,076
1,269
605
1,788
8,759
(86)
191,448

72,393
97,975
3,232
3,801
14,034
1,471
648
1,770
6,339
(95)
201,571

31,502(11,854)
19,647
1,386
(919)
467
15,556640(570)
70
16,524(3,129)13,395
4,428
8,926(6,721)
2,204
55,77031,735(12,828)
18,9075,890(1,252)
4,637
14,451
681
(566)
114
16,594(3,385)
13,2091,235
9,259(7,163)
2,095
54,652

10,6501,129
11,7809,304
1,029
10,333

7,862
9,870
983
3,474
79
5,544
902
(2,536)26,181
93,372
285,181

14,683
9,531
1,060
3,188
452
5,512
848
(2,624)32,654
97,640299,212SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019

(Unit: Millions yen)March 31, 2019

March 31, 2018
Liabilities
Current liabilities
Notes and accounts payable - trade

88,71685,371

Electronically recorded obligations - operating

21,786

20,772

Short-term loans

2,970

1,030

Current portion of long-term loans

4,676

4,968

Income taxes payable

4,745

4,139

Provision for bonuses

1,966

2,032

Other

13,064

9,861

Total current liabilities

137,925

128,176

Non-current liabilities–

25,116Long-term loans

36,76539,700Net defined benefit liability

2,706

2,811

728

1,070

Bonds with share acquisition rights

Deferred tax liabilities
Asset retirement obligations
Other
Total non-current liabilities

619

628

4,081

3,973

44,90073,300182,826

201,477

Capital stock

15,553

15,553

Capital surplus

23,94823,921Retained earnings

58,374

66,372

Treasury stock(448)(13,447)

97,42892,399

2,596

3,079

(92)

(84)

Total liabilities
Net assets
Shareholders' equity

Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

7

(52)

26

2,451

3,021

2,474

2,314

102,354

97,734285,181299,212SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019(2) Consolidated statement of income and consolidated statement of comprehensive income
Consolidated statement of income
Fiscal year ended
March 31, 2018
425,566(Unit: Millions yen)
Fiscal year ended
March 31, 2019
444,048

Cost of sales

378,484

397,396

Gross profit

47,082

46,652

Directors’ compensation

1,473

1,435

Salaries and allowances

9,161

9,327

Bonuses

1,439

1,338

423

453

Net sales

Sales, general, and administrative expenses

Retirement benefit expenses
Provision for bonuses

875

884

Other

15,44815,260Total sales, general, and administrative expenses

28,822

28,69918,25917,952

Interest income

301

306

Dividend income

124

206

Amortization of negative goodwill

232

232

Share of profit of entities accounted for using equity method

34

67

Reversal of allowance for doubtful accounts

9–

Operating profit
Non-operating profit

–

9

395

298

1,098

1,112

254

258

Bond issue cost–37

Foreign exchange losses

13–

Provision of allowance for doubtful accounts–

139

Losses on sales of accounts receivable

72

18

Other

81

79

Total non-operating expenses

422

532

18,935

18,532Foreign exchange profit
Other
Total non-operating profit
Non-operating expenses
Interest expenses

Total ordinary profit

8

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019

(Unit: Millions yen)
Fiscal year ended
March 31, 2019

Fiscal year ended
March 31, 2018
Extraordinary profit
Gains on sales of property, plant, and equipment

61

61

Gains on transfer of business

20

–

Other

0

–

Total extraordinary profit

82

61

Extraordinary losses
Losses on sales of property, plant, and equipment

35

0

Losses on retirement of property, plant, and equipment

30

19

Losses on valuation of investment securities

113

34

Impairment loss

851

44

Losses on litigation

568

–

3

3

Other
Total extraordinary losses

1,604

102

Total income before income taxes

17,413

18,490

Income taxes - current

7,466

7,015

Income taxes - deferred

(542)

392

Total income taxes

6,924

7,407

Profit10,48911,083138(152)

10,350

11,236

Profit attributable to non-controlling interests
Profit attributable to owners of parent

9

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019

Consolidated statement of comprehensive income
Fiscal year ended
March 31, 2018
10,489(Unit: Millions yen)
Fiscal year ended
March 31, 201911,083

Valuation difference on available-for-sale securities

1,137

482

Translation adjustments

(272)

22

Remeasurements of defined benefit plans

(48)

78

Other comprehensive income

815

583

11,304

11,666

11,29911,805

5(139)

ProfitOther comprehensive income

Comprehensive income(Breakdown)Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests

10SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019(3) Consolidated statement of changes in equity
Previous consolidated fiscal year (April 1, 2017–March 31, 2018)(Unit: Millions yen)
Shareholders’ equity
Capital stock
Balance at beginning of current
periodCapital surplus

15,553Retained earnings

23,71651,059Total shareholders’equityTreasury stock(448)

89,881

Changes of items during period
Dividends of surplus(3,035)(3,035)

Profit attributable toowners of parent

10,35010,350Purchase of treasury stock–

Capital increases by
consolidated subsidiaries

232

232

Net changes of items otherthan shareholders’ equity
Total changes of items during
periodBalance at end of current
period

–

232

7,314

–

7,547

15,55323,94858,374(448)

97,428

Accumulated other comprehensive income

Balance at beginning of current
periodValuation difference
on available-for-salesecurities

Foreign currencytranslation
adjustments

1,459

47

Remeasurements of Total accumulated
defined benefit
other comprehensive
plansincome(3)

1,503

Non-controllinginterests

2,247

Total net assets

93,632

Changes of items during period
Dividends of surplus(3,035)

Profit attributable toowners of parent

10,350Purchase of treasury stock–

Capital increases by
consolidated subsidiaries

232

Net changes of items otherthan shareholders’ equity

1,137

(140)

(48)

948

227

1,175

Total changes of items during
period

1,137

(140)

(48)

948

227

8,722

Balance at end of current
period

2,596

(92)

(52)

2,451

2,474

102,354

11

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019

This consolidated fiscal year (April 1, 2018–March 31, 2019)(Unit: Millions yen)
Shareholders’ equity
Capital stock
Balance at beginning of current
periodCapital surplus

15,553Retained earnings

23,94858,374

Treasury stock(448)

Total shareholders’equity97,428Changes of items during period
Dividends of surplus(3,238)(3,238)

Profit attributable toowners of parent

11,52911,236

Purchase of treasury stock(12,999)

Capital increases by
consolidated subsidiaries(27)(12,999)(27)

Net changes of items otherthan shareholders’ equity
Total changes of items during
periodBalance at end of current
period

–

(27)

7,997

(12,999)(5,029)15,55323,921

66,372(13,447)

92,399

Accumulated other comprehensive income
Valuation difference
on available-for-salesecurities

Balance at beginning of current
period2,596

Foreign currencytranslation
adjustments

Remeasurements of Total accumulated
defined benefit
other comprehensive
plansincome

(92)

(52)

2,451

Non-controllinginterests

2,474

Total net assets

102,354

Changes of items during period
Dividends of surplus(3,238)

Profit attributable toowners of parent

11,236

Purchase of treasury stock(12,999)

Capital increases by
consolidated subsidiaries(27)

Net changes of items otherthan shareholders’ equity

482

8

78

569

(160)

409

Total changes of items during
period

482

8

78

569

(160)

(4,620)

3,079

(84)

26

3,021

2,314

97,734

Balance at end of current
period12

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019(4) Consolidated statement of cash flows(Unit: Millions yen)
Fiscal year ended
March 31, 2019

Fiscal year ended
March 31, 2018
Cash flows from operating activities
Income before income taxes

17,413

18,490Depreciation and amortization

2,514

2,842

Impairment loss

851

44

Amortization of goodwill

1,671

1,661

Amortization of negative goodwill

(232)

(232)

Share of loss (profit) of entities accounted for using equity method

(34)

(67)

Increase (decrease) in provision for bonuses

25

63

Increase (decrease) in allowance for doubtful accounts

(52)

96

Net decrease (increase) in lease investment assets

184

72

Increase (decrease) in net defined benefit liability

99

182

Loss (gain) on sales of property, plant and equipment

(25)

(60)

Loss on retirement of property, plant and equipment

29

18

Loss on retirement of intangible assets

10Loss (gain) on sales of investment securities

1–

Loss (gain) on valuation of investment securities

113

34

Loss (gain) on transfer of business

(20)

–

Interest and dividend income

(426)

(513)

Interest expenses

254

258

(3,927)

1,329

Decrease (increase) in inventories(910)(1,196)

Increase (decrease) in notes and accounts payable – trade

7,466(4,367)

Decrease (increase) in notes and accounts receivable – trade

Other

2,006

(626)

Subtotal

27,00318,034

Interest and dividend income received

423

503

Interest expenses paid

(251)

(257)

Income taxes paid

(6,971)(7,745)

Cash flows from operating activities

20,204

10,53413

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019

(Unit: Millions yen)
Fiscal year ended
March 31, 2019

Fiscal year ended
March 31, 2018
Cash flows from investing activities
Payments into time deposits

(239)

(238)

Proceeds from withdrawal of time deposits

342

186

Purchase of property, plant, and equipment(5,706)(2,767)

Proceeds from sales of property, plant, and equipment

351

1,618

Purchase of intangible assets

(179)

(252)

Payments of short-term loans receivable

(108)

(584)

Collection of short-term loans receivable

4

226

Payments of long-term loans receivable

(2)

(1)

Collection of long-term loans receivable

335

310

Purchase of investment securities(9)(6,097)

Proceeds from sales and redemption of investment securities

112

0

Payments for transfer of operation

(70)

–

Payments for transfer of business(6)–

Proceeds from liquidation of subsidiaries and associates
Purchase of shares of subsidiaries resulting in change inscope of consolidation
Other

442

–

(1,914)

(78)

5

1

Cash flows from investing activities(6,640)(7,678)Cash flows from financing activities
Net increase (decrease) in short-term loans payable950(1,940)

Proceeds from long-term loans payable

10,521

8,000

Repayments of long-term loans payable(9,925)(4,771)–

25,087

Proceeds from issue of bonds
Redemption of bonds
Purchase of treasury stock
Cash dividends paid
Dividends paid to non-controlling interests(2,050)－–(12,999)(3,035)(3,238)

(46)

(48)

Proceeds from share issuance to non-controlling shareholders

498－

Repayments of lease obligations

(250)

(252)

Other
Cash flows from financing activities
Effect of exchange rate change on cash and cash equivalents

(9)

(7)

(3,347)

9,828

(90)

21

Net increase (decrease) in cash and cash equivalents

10,126

12,706

Cash and cash equivalents at the beginning of the period

48,66158,787

Cash and cash equivalents at the end of the period

58,78771,494

14

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019(5) Notes on consolidated financial statements(Notes on the going concern assumption)
Not applicable(Changes in presentation)
Starting from the first quarter of current fiscal year, the Company has applied the ASBJ Statement No. 28 (Partial
Amendments to Accounting Standard for the Tax Effect Accounting), issued on February 16, 2018. Accordingly,
deferred tax assets and deferred tax liabilities are reclassified and included in the Investments and Other Assets section
and the non-current liabilities section, respectively.
As a result, out of“Deferred tax assets”of 2,039 million yen presented under“Current assets”in the previous fiscal year,
1,783 million yen was included in 3,474 million yen of“Deferred tax assets”under“Investments and other assets”
and“Deferred tax liabilities”of 2 million yen was included in 728 million yen of “Deferred tax liabilities”under“Non-current Liabilities”
In addition, as a result of offsetting “Deferred tax assets” and “Deferred tax liabilities” by the same taxpayer, total
assets in the previous consolidated fiscal year decreased by 256 million yen.
(Segment information, etc.)[Segment information]
1

Overview of reporting segments
The Company’s reporting segments are Company components for which separate financial information is available andsubject to periodic review by the Board of Directors in determining the allocation of management resources and evaluating
business performance.
The Company classifies its business divisions by service. The Company formulates comprehensive strategies reflecting thenature of the activities of each business division and subsidiary and undertakes business activities based on these strategies.
Accordingly, the Company organizes its segments based on its business divisions. Its four reporting segments are the Total
Pack Produce business, the Medical Supply business, the Life Care business, and the Dispensing Pharmacy business.
The Total Pack Produce segment engages in sales of medical devices and medical equipment based on bulk orders;consulting on topics including medicine, healthcare, welfare, and nursing care facilities; and leasing of real estate to medical
facilities and other tenants. The Medical Supply segment engages in sales of medical examination and treatment materials
and special treatment materials. The Life Care segment operates homes for senior citizens, group homes, and other facilities
and nutritional services. The Dispensing Pharmacy segment operates dispensing pharmacies, among other business activities.

2

Methods for calculating net sales, profit (loss), assets, and other amounts by reporting segment
The accounting methods for reporting segments are same as those outlined under “Significant Matters that Serve as the Basisfor Preparation of Consolidated Financial Statements.”
Reporting segment profit figures are based on operating profit. Intersegment revenues and transfers are based on market
prices.

15

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 20193

Net sales, profit (loss), assets, and other amounts by reporting segment
Previous consolidated fiscal year (April 1, 2017–March 31, 2018)(Unit: Millions yen)
Adjustments*2

Amountrecorded on
consolidated
financialstatements*3

425,566–

425,566

110

6,130

(6,130)–426,657

5,039

431,696(6,130)425,566

2,826

18,093303

18,396(137)

18,25925,56816,362

260,847

2,603

263,450

21,987285,438

457

679

261

2,324

64

2,389

125

2,514

72

619

405

515

1,611

59

1,671

–

1,671

232

0

0

–

232

–

232

–

232

208

–

–

643

851

–

851

–

851

Reporting segment
Total packproducebusiness

Medicalsupplybusiness

Life carebusiness

Dispensing
pharmacybusiness

Subtotal

98,064

274,058

22,72425,789420,636

4,929

1,783

1,551

234

2,451

6,020

Subtotal

99,847

275,610

22,95828,240

Segment profit

10,1504,161955

Segment assets

104,419

114,496926

Other*1

Total

Net sales(1) Sales to outside
customers(2) Intersegment
sales or transfers

Other items
Depreciation
Amortization of
goodwill
Amortization ofnegative goodwill
Impairment loss

Investment inentities accounted
236
–
–
–
236
–
236
–
236
for using equity
methodIncrease inproperty, plant
4,983
212
155
592
5,945
94
6,039
331
6,371
and equipment,
and intangible
fixed assets
Notes:
1. The “Other” category includes businesses not included in reporting business segments, such as the veterinary hospitalbusiness, sales of physical and chemical apparatus, and security business.
2. The amounts of the various adjustments are described below.
(1) The figure of ¥(137) million yen in adjustments to segment profit includes ¥(6) million yen for the cancellation ofintersegment transactions, ¥(136) million yen for companywide costs not allocated to an individual reporting segment.
These companywide costs consist mainly of parent company operating expenses and sales, general, and administrative
expenses not attributable to individual reporting segments.
(2) The figure of ¥21,987 million yen in adjustments to segment assets includes ¥(8,919) million yen for cancellation ofintersegment transactions, ¥(348) million yen for offsetting of negative goodwill, and ¥31,203 million yen forcompanywide assets not allocated to an individual reporting segment. These companywide assets consist mainly ofassets related to administrative sections not attributable to individual reporting segments.
(3) The figure of ¥331 million yen in adjustments to increase in property, plant and equipment, and intangible fixed assets
consists mainly of capital investment related to administrative sections not attributable to individual reporting
segments.
3. Segment profit is adjusted against the operating profit reported on the consolidated statement of income.

16

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019

Consolidated fiscal year under review (April 1, 2018–March 31, 2019)(Unit: Millions yen)
Adjustments*2

Amountrecorded on
consolidated
financialstatements*3

444,048－444,048

258

5,641

(5,641)－

444,274

5,415

449,690(5,641)

444,048

2,193

17,804421

18,226(273)

17,952

24,932

15,350254,5312,681

257,212

41,999299,212

446

657

239

2,650

56

2,706

136

2,842

70

616

403

511

1,602

59

1,661

－

1,661

232

－

0

－

232

－

232

－

232

－

－

－

－

－

44

44

－

44

Reporting segment
Total packproducebusiness

Medicalsupplybusiness

Life carebusiness

Dispensing
pharmacybusiness

Subtotal

99,441

290,363

23,50025,585438,890

5,157

2,100

1,274

205

1,803

5,383

101,542

291,637

23,70527,388Segment profit

9,794

4,191

1,625

Segment assets

101,706

112,541

1,306

Other*1

Total

Net sales(1) Sales to outside
customers(2) Intersegment
sales or transfers
Subtotal

Other items
Depreciation
Amortization of
goodwill
Amortization ofnegative goodwill
Impairment loss

Investment inentities accounted
303
303
303
303
－
－
－
－
－
for using equity
methodIncrease inproperty, plant
1,575
1,342
298
297
3,514
31
3,546
15
3,561
and equipment,
and intangible
fixed assets
Notes:
1. The “Other” category includes businesses not included in reporting business segments, such as the veterinary hospitalbusiness, sales of physical and chemical apparatus, and security business.
2. The amounts of the various adjustments are described below.
(1) The figure of ¥(273) million yen in adjustments to segment profit includes ¥(84) million yen for the cancellation ofintersegment transactions, ¥(192) million yen for companywide costs not allocated to an individual reporting segment.
These companywide costs consist mainly of parent company operating expenses and sales, general, and administrative
expenses not attributable to individual reporting segments.
(2) The figure of ¥41,999 million yen in adjustments to segment assets includes ¥(9,094) million yen for cancellation ofintersegment transactions, ¥(116) million yen for offsetting of negative goodwill, and ¥51,169 million yen forcompanywide assets not allocated to an individual reporting segment. These companywide assets consist mainly ofassets related to administrative sections not attributable to individual reporting segments.
(3) The figure of ¥15 million yen in adjustments to increase in property, plant and equipment, and intangible fixed assets
consists mainly of capital investment related to administrative sections not attributable to individual reporting
segments.
3. Segment profit is adjusted against the operating profit reported on the consolidated statement of income.

17

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019

[Related information]
Previous consolidated fiscal year (April 1, 2017–March 31, 2018)1

Product- and service-specific information
This information is reported under segment information and is therefore omitted here.

2

Region-specific information(1) Net sales
This information is omitted because sales to external customers in Japan account for more than 90% of net sales on theConsolidated Statement of Income.
(2) Property, plant and equipment
This information is omitted because property, plant and equipment located in Japan account for more than 90% of property,
plant and equipment on the Consolidated Balance Sheet.

3

Information concerning key individual customers
Not applicable because sales to no single external customer account for 10% or more of net sales on the Consolidated
Statement of Income.
This consolidated fiscal year (April 1, 2018–March 31, 2019)1

Product- and service-specific information
This information is reported under segment information and is therefore omitted here.

2

Region-specific information(1) Net sales
This information is omitted because sales to external customers in Japan account for more than 90% of net sales on theConsolidated Statement of Income.
(2) Property, plant and equipment
This information is omitted because property, plant and equipment located in Japan account for more than 90% of property,
plant and equipment on the Consolidated Balance Sheet.

3

Information concerning key individual customers
Not applicable because sales to no single external customer account for 10% or more of net sales on the Consolidated
Statement of Income.

[Information concerning impairment losses on fixed assets per reporting segment]
Previous consolidated fiscal year (April 1, 2017–March 31, 2018)
This information is reported under segment information and is therefore omitted here.
This consolidated fiscal year (April 1, 2018–March 31, 2019)
This information is reported under segment information and is therefore omitted here.

18

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019

[Information concerning amounts of amortization of goodwill and remaining unamortized balances, per reporting segment]
Previous consolidated fiscal year (April 1, 2017–March 31, 2018)(Unit: Millions yen)
Reportable segment
Total Pack
Producebusiness(Goodwill)Ending balance

636

MedicalSupplybusiness
3,849

Life Carebusiness

Dispensing
Pharmacybusiness

3,433

2,586

Companywide/cancellation

Other
Subtotal

10,506

492

–

Total

10,998(Negative goodwill)
348
–
0
–
348
–
–
348
Ending balance
Notes:
1. Amounts of amortization of goodwill and amortization of negative goodwill are omitted because similar information isreported under segment information.
2. Negative goodwill was incurred for reasons including corporate consolidations implemented before March 31, 2010 and isindicated on the Consolidated Balance Sheet after offsetting.

This consolidated fiscal year (April 1, 2018–March 31, 2019)(Unit: Millions yen)
Reportable segment
Total Pack
Producebusiness(Goodwill)Ending balance

565

MedicalSupplybusiness
3,233

Life Carebusiness

Dispensing
Pharmacybusiness

3,030

2,158

Companywide/cancellation

Other
Subtotal

8,987

432

–

Total

9,420

(Negative goodwill)
116
–
–
–
116
–
–
116
Ending balance
Notes:
1. Amounts of amortization of goodwill and amortization of negative goodwill are omitted because similar information isreported under segment information.
2. Negative goodwill was incurred for reasons including corporate consolidations implemented before March 31, 2010 and isindicated on the Consolidated Balance Sheet after offsetting.

[Information on gains on bargain purchases per reporting segment]
Previous consolidated fiscal year (April 1, 2017–March 31, 2018)
No important gains on bargain purchases occurred.
This consolidated fiscal year (April 1, 2018–March 31, 2019)No important gains on bargain purchases occurred.

19

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019

(Per-share information)
Fiscal year ended
March 31, 2018

Fiscal year ended
March 31, 2019
(Yen)

(Yen)

Net assets per share

1,973.95

2,003.36

Net income per share

204.57227.75–221.11

Diluted net income per share

Notes:
1. Diluted net income per share is not indicated because there were no diluting shares.
2. Net income per share was calculated based on the following information:
Account

Fiscal year ended
March 31, 2018

Net income per share
Profit attributable to owners of parent(millions yen)

Fiscal year ended
March 31, 201910,350

11,236––

10,350

11,23650,599,132

49,335,752

Diluted net income per share–

221.11

Adjustment for profit attributable to owners ofparent (millions yen)–

(5)((Interest income) after tax equivalentdeduction) (millions yen)–

(5)

Increase in number of common stock(shares)–

1,456,876(Bonds with share acquisition rights included inabove) (shares)(–)(1,456,876)

Amount not attributable to owners ofcommon stock (millions yen)
Profit attributable to owners of parent related tocommon stock (millions yen)
Average shares of common stock during theperiod (shares)

Description of potentially dilutive commonshares not included in the computation ofdiluted earnings per share because of theiranti-dilutive effect––

3. Net assets per share were calculated based on the following information:
Account

Fiscal year ended
March 31, 2018

Total net assets (millions yen)

Fiscal year ended
March 31, 2019
102,354

97,734

Amount subtracted from total net assets(millions yen)

2,474

2,314

(Non-controlling interests included in above)(millions yen)

(2,474)(2,314)Ending balance of net assets related to common
stock (millions yen)

99,88095,420Ending number of shares of common stock usedin calculation of net assets per share (shares)

50,599,132

47,630,165

20

SHIP HEALTHCARE HOLDINGS, INC. (3360): Summary of Financial Statements
for Fiscal Year Ended March 31, 2019

(Important subsequent information)(Purchase of treasury stock)
At its meeting held May 10, 2019, the Company’s board of directors passed a resolution related to the purchase of treasury
shares pursuant to Article 156 of the Companies Act applicable with rewording as required under Article 165, Paragraph 3of that Act.
1. Reason for purchase of treasury shares
Treasury shares was purchased to implement dynamic capital policies in response to changes affecting businessconditions.
2. Details of purchase(1) Class of stock subject to the purchase:(2) Total number of shares to be purchased:(3) Total purchase price of stock:(4) Period of purchase:(5) Method of purchase:

Company common stock
Up to 240,000 shares(Corresponding percentage of total shares issued and outstanding, notincluding treasury shares: 0.5%)
Up to 1 billion yen
May 13,2019–March 31, 2020
Market purchases on the Tokyo Stock Exchange

21