Summary of Financial Results for the Second Quarter of Fiscal Year 2015
(Six Months Ended June 30, 2015)[Japanese GAAP]
July 30, 2015

Company name: SENSHUKAI CO.,LTD.

Stock exchange: Tokyo Stock Exchange, First Section
8165
URL: http://www.senshukai.co.jp
Mr. Michio Tanabe, President and Representative Director
Mr. Hiroyuki Hoshino, Managing Director, Executive Officer,
General Manager of the Corporate Development Division Tel: +81-6-6881-3220
Scheduled date of filing of Quarterly Report: August 11, 2015
Scheduled date of payment of dividend: September 1, 2015
Preparation of supplementary materials for quarterly financial results: Yes
Holding of quarterly financial results meeting: Yes
Stock code:
Representative:
Inquiries:(All amounts are rounded down to the nearest millions of yen)

1. Consolidated Financial Results for the 2nd Quarter of 2015 (January 1, 2015 – June 30, 2015)(1) Consolidated operating results (cumulative)(Percentages represent changes from the same period of the previous fiscal year)
Operating income
Ordinary income
Net income

Net sales
Millions of yen%

Millions of yen%

2Q 2015
68,161(7.9)(1,154)
2Q 201474,0481.8
1,833 12.7
Note: Comprehensive income (millions of yen)
2Q 2015: (645) (- %)Millions of yen

Net income per share

Diluted net income per share

Yen

Yen

(26.50)
21.11

19.96

2Q 2015
2Q 2014%

Millions of yen(1,063)
1,946(2.4)
2Q 2014: 8 (down 99.7 %)%(1,219)914 (26.4)(2) Consolidated financial position
Total assets

Net assets

Millions of yen

Equity ratio

Millions of yen

2Q 2015
108,055
Fiscal Year 2014
100,785
Reference: Shareholders’ equity (millions of yen) 2Q 2015: 59,542

59,57753,160Net assets per share
%

Yen

55.1
52.7
Fiscal Year 2014: 53,160

1,140.49
1,227.52

2. Dividends
1Q-endDividend per share
3Q-end2Q-endYen

Yen

Fiscal Year 2014
12.00
Fiscal Year 2015
4.00
Fiscal Year 2015 (forecasts)
Note: Revision to the most recently announced dividend forecast: None

Year-end

Total

Yen

Yen

Yen

-

12.00

24.00

-

4.00

8.00

3. Consolidated Outlook for Fiscal Year 2015 (January 1, 2015 – December 31, 2015)(Percentages represent changes from the same period of the previous fiscal year)
Net income
Net sales
Operating income
Ordinary income
Net income
per share
Millions of yen% Millions of yen% Millions of yen% Millions of yen%
Yen
Full Year 2015
135,500 (4.9)(3,400)(3,150)(4,400)(89.55)
Note: Revision to the most recently announced consolidated outlook: None

* Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in changes inscope of consolidation): None
Newly added: -Excluded: -(2) Application of special accounting methods for presenting quarterly consolidated financial statements: Yes
Note: Please refer to “2. Matters Related to Summary Information (Notes), (2) Application of Special Accounting Methods
for Presenting Quarterly Consolidated Financial Statements” on page 4 for further information.

(3) Changes in accounting policies and accounting-based estimates, and restatements
1) Changes in accounting policies due to revisions in accounting standards, others: None
2) Changes in accounting policies other than 1) above: None
3) Changes in accounting-based estimates: None
4) Restatements: None

(4) Number of shares outstanding (common shares)
1) Number of shares outstanding at end of period (including treasury shares)
2Q 2015:

52,230,393 sharesFiscal Year 2014:

47,630,393 sharesFiscal Year 2014:

4,322,649 shares

2Q 2014:43,308,375 shares

2) Number of treasury shares at end of period
2Q 2015:

23,003 shares

3) Average number of shares outstanding during the period
2Q 2015:

46,012,057 shares* Disclosure regarding the implementation of quarterly review procedures
These quarterly financial results materials are not subject to quarterly review procedures based on the Financial Instruments
and Exchange Act. Thus, at the time of its disclosure, the quarterly financial statement review procedures based on the
Financial Instruments and Exchange Act have not been completed.
* Cautionary statement with respect to forward-looking statements
The above projections are based on information available at the time of release of this report. Actual results could differ
significantly from these projections due to a variety of factors. For further details regarding the projections, please refer to page3, “1. Qualitative Information on Quarterly Consolidated Financial Performance, (3) Explanation of Consolidated Forecasts
and Other Forward-looking Statements.”

SENSHUKAI CO.,LTD. (8165) Financial Results for the Second Quarter of Fiscal Year 2015

Contents of Attachments
1. Qualitative Information on Quarterly Consolidated Financial Performance2(1) Explanation of Results of Operations

2(2) Explanation of Financial Position

3(3) Explanation of Consolidated Forecasts and Other Forward-looking Statements

3

2. Matters Related to Summary Information (Notes)

4(1) Changes in Significant Subsidiaries during the Period

4(2) Application of Special Accounting Methods for Presenting Quarterly Consolidated Financial Statements

4(3) Changes in Accounting Policies and Accounting-based Estimates, and Restatements

4

3. Quarterly Consolidated Financial Statements

5(1) Quarterly Consolidated Balance Sheet

5(2) Quarterly Consolidated Statement of Income and Quarterly Consolidated Statement of Comprehensive
Income7

Quarterly Consolidated Statement of Income(For the Six-month Period)

7

Quarterly Consolidated Statement of Comprehensive Income(For the Six-month Period)8(3) Quarterly Consolidated Statement of Cash Flows

9(4) Notes to Quarterly Consolidated Financial Statements

10(Going Concern Assumption)

10(Significant Changes in Shareholders’ Equity)

10(Segment and Other Information)

10(Subsequent Events)

11

-1-

SENSHUKAI CO.,LTD. (8165) Financial Results for the Second Quarter of Fiscal Year 2015

1. Qualitative Information on Quarterly Consolidated Financial Performance(1) Explanation of Results of Operations
In the cumulative second quarter (January 1, 2015 to June 30, 2015) of the current fiscal year, the Japanese
economy continued to recover at a moderate pace as the benefits of economic stimulus measures by thegovernment and monetary easing by the Bank of Japan support growth in corporate earnings and the number ofjobs. However, personal consumption remains lackluster. Consumers are adopting an increasingly defensive
stance about expenditures because wage increases are not keeping up with inflation. As a result, the economic
outlook remains unclear.
The Senshukai Group is currently in the second year of the medium- to long-term management plan “Innovate for
Smiles 2018” that covers the five-year period ending in 2018. All group companies are focusing their energy onachieving the goals of this plan.
Net sales in the cumulative second quarter decreased 7.9% year-over-year to 68,161 million yen. The main reason
was a downturn in orders in the mail-order business, which accounts for most sales, due to the prolonged drop insales after the April 2014 consumption tax hike and a decrease in order amount caused by a revision in marketingmeasures.
There was an operating loss of 1,154 million yen compared with operating income of 1,833 million yen in thesame period of the previous fiscal year, because of an increase in the cost of sales ratio. This ratio was higher due
to the higher cost of merchandise as the yen weakened, growth in the percentage of sales from discounted
merchandise in association with weak sales, and an increase in clearance sales.
Ordinary loss was 1,063 million yen compared with ordinary income of 1,946 million yen in the same period of
the previous fiscal year. Including the effect of reexamining the recoverability of deferred tax assets, there was a
net loss of 1,219 million yen compared with net income of 914 million yen in the same period of the previous
fiscal year.
Overview by segment(Mail-order Business)
Consolidated sales in the mail-order business, centered on the catalog and the Internet businesses, decreased
10.6% year-over-year to 59,033 million yen in the cumulative second quarter, due to the prolonged drop in sales
after the April 2014 consumption tax hike and a decrease in order amount caused by a revision in marketingmeasures.
There was an operating loss of 1,434 million yen compared with operating income of 1,464 million yen in thesame period of the previous fiscal year, because of an increase in the cost of sales ratio. This ratio was higher due
to the higher cost of merchandise as the yen weakened, growth in the percentage of sales from discounted
merchandise in association with weak sales, and an increase in clearance sales.
(Bridal Business)
Consolidated sales in the bridal business, centered on the house wedding business, increased 13.5%
year-over-year to 6,685 million yen in the cumulative second quarter, because of the acquisition in March of
PLANETWORK CO.,LTD, which mainly operates house wedding business. Operating income decreased 48.2%
to 89 million yen.
(Corporates Business)
Consolidated sales in the corporates business, which provides products and services to corporations, increased
10.8% year-over-year to 2,078 million yen, and operating income increased 5.1% to 188 million yen.
(Others)
Consolidated sales in other businesses, which provides services business (primarily insurance and credit card
services) and childcare business, increased 51.9% year-over-year to 364 million yen. Operating loss was 4 million
yen, compared with an operating income of 16 million yen in the same period of the previous fiscal year.

-2-

SENSHUKAI CO.,LTD. (8165) Financial Results for the Second Quarter of Fiscal Year 2015

(2) Explanation of Financial Position(Balance sheet position)
Assets totaled 108,055 million yen at the end of the second quarter of the current fiscal year, an increase of 7,269
million yen from the end of the previous fiscal year.
Current assets increased 4,718 million yen to 58,273 million yen. The main factor was an increase of 11,698
million yen in cash and deposits, while there were decreases of 2,435 million yen in notes and accounts
receivable-trade, 1,712 million yen in merchandise and finished goods, 1,648 million yen in accounts
receivable-other and 1,249 million yen in other. Non-current assets increased 2,551 million yen to 49,782 million
yen. The main factors were increases of 1,638 million yen in property, plant and equipment, and 944 million yen
in investments and other assets, while there was a decrease of 31 million yen in intangible assets.
Current liabilities decreased 3,021 million yen to 30,449 million yen. The main factors were decreases of 2,369
million yen in other, 746 million yen in income taxes payable, and 327 million yen in accounts payable-trade,while there was an increases of 328 million yen in electronically recorded obligations-operating. Non-current
liabilities increased 3,874 million yen to 18,027 million yen. The main factor was an increase of 4,342 million yen
in long-term loans payable, while there was a decrease of 450 million yen in bonds payable.
Net assets increased 6,416 million yen to 59,577 million yen. There was a decrease of 1,660 million yen inretained earnings. However, there were increases of 1,945 million yen in capital stock, 2,821 million yen incapital surplus, and a decrease of 2,762 million yen in treasury shares as a result of the issuance of new shares andthe disposal of treasury shares through the third-party allotment to J.FRONT RETAILING Co.,Ltd. in May 2015.
Consequently, the equity ratio was 55.1%.
(Cash flow position)
The balance of cash and cash equivalents at the end of the second quarter of the current fiscal year was 18,309
million yen, an increase of 10,398 million yen from the end of the previous fiscal year.
Operating activities provided net cash of 3,141 million yen (net cash provided of 3,514 million yen in the same
period of the previous fiscal year). The main cash inflows were decreases of 2,523 million yen in notes andaccounts receivable-trade, 2,470 million yen in other current assets, and 1,714 million yen in inventories. The
main cash outflows were a decrease of 2,346 million yen in other current liabilities, and a loss before income
taxes and minority interests of 1,162 million yen.
Investing activities used net cash of 3,653 million yen (net cash used of 1,290 million yen in the same period of
the previous fiscal year). The main cash inflow was the proceeds from redemption of investment securities of 300
million yen. The main cash outflows were 1,953 million yen for the purchase of property, plant and equipment,
1,000 million yen for the payments into time deposits, 612 million yen for the purchase of shares of subsidiaries,and 404 million yen for the purchase of intangible assets.
Financing activities provided net cash of 10,844 million yen (net cash provided of 2,122 million yen in the same
period of the previous fiscal year). The main cash inflows were the proceeds from long-term loans payable of
5,600 million yen, proceeds from issuance of common shares of 3,868 million yen, and proceeds from disposal oftreasury shares of 3,637 million yen. The main cash outflows were 1,341 million yen for the repayments oflong-term loans payable, 513 million yen for the cash dividends paid, and 350 million yen for the redemption ofbonds.
(3) Explanation of Consolidated Forecasts and Other Forward-looking Statements
Senshukai currently maintains its consolidated outlook for the current fiscal year (January 1, 2015 to December
31, 2015) that was revised and released on July 24, 2015.
On July 24, 2015, Senshukai announced the start of a tender offer for the shares of Watabe Wedding Corporation(stock code: TYO 4696), the purchase of Watabe Wedding share through a third-party allotment, and the signingof a capital and business alliance agreement that includes Senshukai, Senshukai wholly owned subsidiary Dears-3-

SENSHUKAI CO.,LTD. (8165) Financial Results for the Second Quarter of Fiscal Year 2015

Brain Inc. and Watabe Wedding. We are currently studying the effects of these matters on the 2015 forecast. An
announcement will be made promptly if there is a need to revise the forecast or if there is any other informationthat should be disclosed.
2. Matters Related to Summary Information (Notes)(1) Changes in Significant Subsidiaries during the Period
Not applicable.
(2) Application of Special Accounting Methods for Presenting Quarterly Consolidated Financial Statements(Calculation of tax expense)
The tax expenses are calculated by first estimating the effective tax rate after the application of tax effectaccounting with respect to income before income taxes and minority interests during the fiscal year in which thequarter under review falls, and multiplying that rate by the income before income taxes and minority interests forthe quarter under review. However, the Company uses legally stipulated effective tax rates to calculate tax
expenses for cases in which using estimated tax rates gives a noticeably irrational result.
(3) Changes in Accounting Policies and Accounting-based Estimates, and Restatements
Not applicable.

-4-

SENSHUKAI CO.,LTD. (8165) Financial Results for the Second Quarter of Fiscal Year 2015

3. Quarterly Consolidated Financial Statements(1) Quarterly Consolidated Balance Sheet(Millions of yen)
Fiscal Year 2014
(As of Dec. 31, 2014)

2Q 2015(As of Jun. 30, 2015)

AssetsCurrent assets
Cash and deposits

7,910

19,609Notes and accounts receivable-trade

6,622

4,187

Merchandise and finished goods

21,591

19,878

Accounts receivable-other

9,511

7,862

Other

8,230

6,980

Allowance for doubtful accounts

(311)

(245)

53,55458,273

Buildings and structures, net

13,963

14,708Land

12,311

12,157

Total current assets
Non-current assets
Property, plant and equipment

Other, net

2,801

3,848

Total property, plant and equipment

29,07530,714

Goodwill

2,225

2,394

Other

3,154

2,954

Total intangible assets

5,380

5,349

Investment securities

6,155

7,073

Other

6,885

6,910

Allowance for doubtful accounts

(265)

(265)

Intangible assets

Investments and other assets

Total investments and other assets
Total non-current assets
Total assets-5-

12,774

13,71847,23149,782

100,785

108,055SENSHUKAI CO.,LTD. (8165) Financial Results for the Second Quarter of Fiscal Year 2015

(Millions of yen)
2Q 2015(As of Jun. 30, 2015)

Fiscal Year 2014
(As of Dec. 31, 2014)
Liabilities
Current liabilities
Electronically recorded obligations-operating

12,124

12,452

Accounts payable-trade

5,397

5,069

Short-term loans payable

2,747

2,593

Current portion of bonds

700

800

Income taxes payable

915

169

Provision for sales promotion expenses

219

367

Other

11,367

8,997

Total current liabilities

33,47030,449Non-current liabilities
Bonds payable

450-

Bonds with subscription rights to shares

7,000

7,000

Long-term loans payable

3,510

7,852

Net defined benefit liability
Other
Total non-current liabilities
Total liabilities

84

91

3,109

3,083

14,15318,02747,624

48,477

20,35922,304

Net assets
Shareholders’ equity
Capital stock
Capital surplus

21,03823,860Retained earnings

17,086

15,426

Treasury shares(2,776)(14)

Total shareholders’ equity

55,707

61,576

Accumulated other comprehensive income
Valuation difference on available-for-sale securities

1,261

2,134

Deferred gains or losses on hedges

2,780

2,430

Revaluation reserve for land

(6,724)(6,748)135

150(2,546)(2,033)Foreign currency translation adjustment
Total accumulated other comprehensive income
Minority interests
Total net assets
Total liabilities and net assets

-6-

-

35

53,16059,577100,785

108,055SENSHUKAI CO.,LTD. (8165) Financial Results for the Second Quarter of Fiscal Year 2015(2) Quarterly Consolidated Statement of Income and Quarterly Consolidated Statement of Comprehensive
Income(Quarterly Consolidated Statement of Income)(For the Six-month Period)
2Q 2014(Jan. 1, 2014 – Jun. 30, 2014)(Millions of yen)
2Q 2015(Jan. 1, 2015 – Jun. 30, 2015)

Net sales

74,04868,161

Cost of sales

39,08236,451Gross profit

34,966

31,710

Selling, general and administrative expenses

33,13232,864

Operating income (loss)

1,833(1,154)

Interest income

20

62

Dividend income

77

76

Gain on adjustment of account payable

98

127

Other

102

197

Total non-operating income

300

465

Interest expenses

102

97

Commission fee-

219

Non-operating income

Non-operating expenses

Other

84

57

Total non-operating expenses

186

374

1,946

(1,063)Gain on sales of non-current assets

017Gain on sales of investment securities

0-

Subsidy income-

150

Total extraordinary income

0

167

42

29

Loss on reduction of non-current assets-

148

Impairment loss

41

88

Loss on sales of investment securities

147-

Total extraordinary losses

231

266

1,716

(1,162)

Ordinary income (loss)
Extraordinary income

Extraordinary losses
Loss on sales and retirement of non-current assets

Income (loss) before income taxes and minority interests
Income taxes

801

74

Income (loss) before minority interests

915(1,236)

0

(17)

914

(1,219)Minority interests in income (loss)
Net income (loss)-7-

SENSHUKAI CO.,LTD. (8165) Financial Results for the Second Quarter of Fiscal Year 2015

(Quarterly Consolidated Statement of Comprehensive Income)(For the Six-month Period)
2Q 2014(Jan. 1, 2014 – Jun. 30, 2014)(Millions of yen)
2Q 2015(Jan. 1, 2015 – Jun. 30, 2015)

915(1,236)

83

873

(960)

(349)

-

53

Foreign currency translation adjustment
Share of other comprehensive income of entities accounted
for using equity method

(20)

10

(9)

4

Total other comprehensive income

(906)

591

8

(645)

Comprehensive income attributable to owners of parent

7

(628)

Comprehensive income attributable to minority interests

0

(17)

Income (loss) before minority interests
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Revaluation reserve for land

Comprehensive income
Comprehensive income attributable to-8-

SENSHUKAI CO.,LTD. (8165) Financial Results for the Second Quarter of Fiscal Year 2015(3) Quarterly Consolidated Statement of Cash Flows(Millions of yen)
2Q 2014
2Q 2015(Jan. 1, 2014 – Jun. 30, 2014) (Jan. 1, 2015 – Jun. 30, 2015)
Cash flows from operating activities
Income (loss) before income taxes and minority interests
Depreciation
Impairment loss
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for sales promotion expenses
Interest and dividend income
Interest expenses
Loss (gain) on sales and retirement of non-current assets
Loss on reduction of non-current assets
Loss (gain) on sales of investment securities
Subsidy income
Decrease (increase) in notes and accounts receivable-trade
Decrease (increase) in inventories
Decrease (increase) in other current assets
Increase (decrease) in notes and accounts payable-trade
Increase (decrease) in other current liabilities
Other, net
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes (paid) refund
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Proceeds from subsidy income
Payments into time deposits
Proceeds from sales of investment securities
Proceeds from redemption of investment securities
Purchase of shares of subsidiaries
Other, net
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
Repayments of long-term loans payable
Proceeds from share issuance to minority shareholders
Proceeds from issuance of bonds with subscription rights tosharesRedemption of bonds
Proceeds from issuance of common shares
Proceeds from disposal of treasury shares
Cash dividends paid
Other, net
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
Increase in cash and cash equivalents from newly consolidated
subsidiary
Cash and cash equivalents at end of period

-9-

1,716
1,271
41
(28)
(144)
(98)
102
41
147
529
930
2,639
5,740
(9,588)
627
3,930
97
(106)
(406)
3,514

(1,162)
1,400
88
(65)
148
(139)
97
12
148
(150)
2,523
1,714
2,470
(159)
(2,346)
(542)
4,037
127
(104)
(919)
3,141

(1,035)
7
(398)
216
150
(125)
(104)
(1,290)(1,953)
131
(404)
150
(1,000)
300
(612)
(264)
(3,653)(4,180)1,500(1,241)
-

(70)
5,600
(1,341)
80

6,980

-

(350)
(520)
(65)
2,122
(13)
4,333
6,495

(350)
3,868
3,637
(513)
(65)
10,84466
10,398
7,910

290

-

11,11818,309SENSHUKAI CO.,LTD. (8165) Financial Results for the Second Quarter of Fiscal Year 2015(4) Notes to Quarterly Consolidated Financial Statements(Going Concern Assumption)
Not applicable.
(Significant Changes in Shareholders’ Equity)
Senshukai has conducted the issuance of new shares through the third-party allotment to J.FRONT RETAILING
Co.,Ltd. and a disposal of treasury shares on May 7, 2015. Accordingly, capital stock and legal capital surplus
increased 1,945 million yen each by the third-party allotment in the cumulative second quarter. In addition,
capital surplus increased 875 million yen and treasury shares decreased 2,762 million yen by the disposal oftreasury shares. As of the end of the second quarter of the current fiscal year, capital stock, capital surplus andtreasury shares were 22,304 million yen, 23,860 million yen and 14 million yen, respectively.
(Segment and Other Information)
I 2Q 2014 (Jan. 1, 2014 – Jun. 30, 2014)
1. Information related to sales and profit or loss for each reportable segment
Reportable segment
Corporates
Sub-total
business

Others(Note 1)

Total

(Millions of yen)Amounts shown onquarterly
Adjustment
consolidated(Note 2)statement of income(Note 3)Mail-orderbusiness

Bridalbusiness

Sales to customers
Inter-segment sales
or transfers
Total

66,042

5,890

1,875

73,808239

74,048-74,048

403

-

38

441

0

442

(442)

-

66,446

5,890

1,913

74,250240

74,490(442)

74,048Segment profit

1,464

173

178

1,817

16

1,833

0

1,833

Net sales

Notes: 1. Others represent the businesses which are not included in any of the three reportable segments and consist mainly of
the services business primarily offering insurance and credit card services.
2. The 0 million yen adjustment to segment profit comprises elimination for inter-segment transactions.
3. Segment profit is adjusted to be consistent with operating income shown on the quarterly consolidated statement ofincome.

2. Information related to impairment of non-current assets, goodwill, etc. for each reportable segment
No major events or changes occurred.
II 2Q 2015 (Jan. 1, 2015 – Jun. 30, 2015)
1. Information related to sales and profit or loss for each reportable segment
Reportable segment
Corporates
Sub-total
business

Others(Note 1)

Total

(Millions of yen)Amounts shown onquarterly
Adjustment
consolidated(Note 2)statement of income(Note 3)Mail-orderbusiness

Bridalbusiness

Sales to customers
Inter-segment sales
or transfers
Total

59,033

6,685

2,078

67,797364

68,161-

68,161

409

-

80

490

0

490

(490)

-

59,443

6,685

2,159

68,288364

68,652(490)

68,161

Segment profit (loss)(1,434)89

188(1,156)(4)(1,160)6(1,154)

Net sales

Notes: 1. Others represent the businesses which are not included in any of the three reportable segments and consist mainly of
the services business primarily offering insurance and credit card services, and childcare business.
2. The 6 million yen adjustment to segment profit (loss) comprises elimination for inter-segment transactions.
3. Segment profit (loss) is adjusted to be consistent with operating loss shown on the quarterly consolidated statementof income.

2. Information related to impairment of non-current assets, goodwill, etc. for each reportable segment
No major events or changes occurred.

- 10 -SENSHUKAI CO.,LTD. (8165) Financial Results for the Second Quarter of Fiscal Year 2015

(Subsequent Events)
On July 24, 2015, the Board of Directors of Senshukai Co.,Ltd. approved resolutions to conduct a tender offer inaccordance with the Financial Instruments and Exchange Act to purchase the common shares of Watabe Wedding
Corporation, to purchase share of this company through a third-party allotment, and to establish a capital andbusiness alliance that includes Senshukai, Senshukai wholly owned subsidiary Dears Brain Inc. and Watabe
Wedding.
1. Overview of the tender offer(1) Purpose of the tender offer
The purpose of the tender offer is to make Watabe Wedding an equity-method affiliate of Senshukai.
Senshukai plans to use the tender offer and third-party allotment to acquire 34.00% of all voting rights of
Watabe Wedding. Senshukai believes that this investment will facilitate the more efficient sharing of theresources of the two companies. Senshukai also expects that this investment will contribute to growth of thebusiness value of Senshukai’s mail-order business and the wedding business of Dears Brain and Watabe
Wedding. In addition, Senshukai believes that this investment will give the Senshukai Group more influence inmarkets where it is active. Consequently, the decision was to establish a capital and business alliance consistingof the Senshukai Group and Watabe Wedding on July 24, 2015.
Senshukai believes that this alliance will contribute to the growth of the Senshukai Group and Watabe Wedding.
The alliance is expected to make it possible to form a business alliance that encompasses a number of businesscategories in the bridal market. The alliance is also expected to yield the benefits of a larger scale of operations
because the Senshukai Group and Watabe Wedding together hold about 25,000 weddings every year.
(2) Outline of Watabe Wedding
Name
Address
Representative

Businesses

CapitalEstablished

WATABE WEDDING CORPORATION
20 Naginataboko-cho, Shijou-dori, Karasuma, Higashiiru, Shimogyo-ku, Kyoto
Nobuaki Hanafusa, President & CEO
Overseas wedding services and travel services for wedding participants; domestic
wedding services including operation of wedding facilities; production and sale ofwedding dresses, etc.; rental of wedding-related attire and formal wear for
coming-of-age ceremonies, various parties, etc.; integrated service of clothing andphotography by combining beauty care, dressing and studio portraits; andwedding-related services, including consultations for wedding halls in Japan,
arranging wedding ceremonies, planning and directing wedding receptions, andbridal goods such as furniture, bedding, jewelry and gems
4,176 million yen (as of March 31, 2015)
October 3, 1964

(3) Purchase period
July 27, 2015 to September 1, 2015 (27 business days)(4) Purchase price
700 yen per common share(5) Number of shares to be purchased
Number of shares to be purchased:
Minimum number of shares to be purchased:
Maximum number of shares to be purchased:

3,367,900 shares
3,367,900 shares(6) Total purchase cost
2,357 million yen
Note: Calculated by multiplying the number of shares to be purchased (3,367,900) by the price per share (700yen)

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Own funds
2. Overview of the third-party allotment(1) Class of shares to be offered
Common shares(2) Number of shares to be offered
5,102,800 shares(3) Payment amount
700 yen per common share(4) Total payment amount
3,571 million yen(5) Payment period
September 7, 2015 to October 28, 2015(6) Method for procuring funds for payment
Own funds(7) Other information
Shares sold by Watabe Wedding through the third-party allotment will be newly issued shares and not treasury
shares.
Senshukai and Watabe Wedding have agreed that if Senshukai purchases shares using the tender offer, thenafter confirming the results of the tender offer, Senshukai will pay for the number of shares in the third-party
allotment that are required in order to hold 34.00% of the voting rights of Watabe Wedding based on the total
number of Watabe Wedding shares acquired using the tender offer and the third-party allotment.
3. Transfer of Watabe Wedding shares to Dears Brain
If Senshukai acquires 34.00% of the voting rights of Watabe Wedding as planned, Senshukai plans to transfer
792,400 shares of Watabe Wedding to Dears Brain. However, as long as Senshukai purchases at least one shareof Watabe Wedding using the third-party allotment and based on the result of the tender offer, the number ofshares of Watabe Wedding to be transferred will be agreed upon by Senshukai and Dears Brain and will be thenumber required in order that Dears Brain holds 8.00% of the voting rights of Watabe Wedding after dilution(less than 100 shares will be rounded up).
4. Stock market listing of Watabe Wedding
The shares of Watabe Wedding are listed on the first section of the Tokyo Stock Exchange. The delisting of
Watabe Wedding is not the intent of the tender offer. The maximum number of shares that Senshukai willpurchase using the tender offer is 3,367,900 (34.00% of all voting rights). Consequently, Watabe Wedding
plans to retain its current stock market listing after the tender offer.

* This financial report is solely a translation of summary of “Kessan Tanshin” (in Japanese, including attachments), which has
been prepared in accordance with accounting principles and practices generally accepted in Japan, for the convenience ofreaders who prefer an English translation.

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