Disclaimer: This is a Japanese-English translation of the summary of financial statements of the Company produced for your convenience. Since
no auditor audited this report, officially only the Japanese version is assumed to be the summary of financial statements of the Company. Thissummary does not constitute any guarantee and will not compensate any losses and/or damage stemming from actions taken based on thesestatements. In the case that there is any discrepancy between the Japanese and English versions, the Japanese version is assumed to be correct.

Consolidated Financial Reportfor Fiscal 2020 (Fiscal Year Ended March 31, 2020 under Japanese GAAP)
Company Name: Grandy House Corporation
Stock Exchange Listing:
Securities Code: 8999
URL:
Representative:
Yasuro Hayashi, President
Inquiries:
Nobuyasu Takeuchi, Director & General Administration Manager
Scheduled date of the Ordinary General Meeting of Shareholders: June 26, 2020
Scheduled date of securities report filing:
June 26, 2020
Scheduled date of dividend payment commencement:
June 29, 2020
Preparation of annual supplementary explanatory materials:
Yes
Annual results briefing held:
None

May 11, 2020
Tokyo Stock Exchange
https://www.grandy.co.jp
TEL: +81-28-650-7777(Figures are rounded down to the nearest million yen unless otherwise stated.)

1. Consolidated Financial Results for Fiscal 2020 (April 1, 2019 to March 31, 2020)(1) Consolidated Operating Results(Percentage figures show the year-on-year increase (decrease).)Net Income Attributable to
Net Sales
Operating Income
Ordinary Income
Owners of the Parent(¥ million)%(¥ million)%(¥ million)%(¥ million)%(31.6)(29.7)(31.6)
Fiscal 2020
45,541
2.5
2,142
2,310
1,413
Fiscal 201944,452
(0.6)
3,131
16.2
3,288
17.6
2,065
13.0
Note: Comprehensive income
Fiscal 2020: ¥1,460 million (-27.7%)
Fiscal 2019: ¥2,021 million (11.4%)
Net Income per
Net Income per
Ordinary Income /Operating Income /Return on Equity
Share
Share (Diluted)
Total Assets
Net Sales
(¥)
(¥)
%
%
%
Fiscal 2020
48.84
48.26
6.6
4.5
4.7
Fiscal 2019
71.62
70.67
10.3
7.0
7.0
Reference: Equity in earnings of affiliates
Fiscal 2020: ― (¥ million)
Fiscal 2019: ― (¥ million)(2) Consolidated Financial Position
Total Assets
Net Assets(¥ million)(¥ million)
March 31,2020
55,98622,143
March 31,2019
46,864
21,124
Reference: Shareholders' equity
Fiscal 2020: ¥21,972 million
Fiscal 2019: ¥20,932 million

Shareholders' Equity Ratio
%
39.2
44.7

Net Assets per Share

Cash Flows from
Financing Activities(¥ million)
5,402(2,351)

Cash and Cash Equivalents
at the End of the Period(¥ million)
10,336
10,001(¥)
755.83725.35(3) Consolidated Cash Flows

Fiscal 2020
Fiscal 2019

Cash Flows fromOperating Activities(¥ million)(2,546)
3,042

Cash Flows from
Investing Activities(¥ million)(2,520)(503)

2. Dividends
Annual Dividend per Share
PeriodTotal
End
(¥)
(¥)
(¥)
(¥)
(¥)
Fiscal 2019
―
0.00
―
18.00
18.00
Fiscal 2020
―
0.00
―
23.00
23.00
Fiscal 2021 (Forecast)
―
―
―
―
―
Note: Dividends for the year ending March 31, 2021 (forecast) have yet to be decided.
1Q-End2Q-End3Q-EndTotal
Dividends(¥ million)
519
668

Payout Ratio(Consolidated)
%
25.1
47.1
―

Ratio of
Dividends to
Net Assets(Consolidated)
%
2.6
3.1

3. Consolidated Financial Forecasts for Fiscal 2021 (April 1, 2020 to March 31, 2021)
We have not yet determined consolidated financial forecasts for fiscal 2021 because it is difficult at this time to reasonably
assess the impact of the COVID-19 outbreak.
We will release the forecasts for fiscal 2021 promptly as soon as it becomes possible to do so.

* Notes(1) Significant changes to subsidiaries during the period(Transfers of specific subsidiaries with changes in the scope of consolidation): None
Newly included: — Excluded: —(2) Changes in accounting policies, accounting estimates, and restatement of revisions
1) Changes in accounting policies due to revision to accounting standards, etc.:
2) Changes in accounting policies other than 1):
3) Changes in accounting estimates:
4) Restatements:(3) Number of issued shares (common stock)1) Number of issued shares(including treasury shares)
2) Number of treasury shares
3) Average number of shares during the period

None
None
None
None

March 31, 2020

30,823,200 shares

March 31, 201930,823,200 shares

March 31, 2020
Fiscal 2020

1,752,445 shares
28,932,663 shares

March 31, 2019
Fiscal 2019

1,965,245 shares
28,839,493 shares

Reference: Non-Consolidated Financial Results
1. Non-Consolidated Financial Results for Fiscal 2020 (April 1, 2019 to March 31, 2020)(1) Non-Consolidated Operating Results(Percentage figures show the year-on-year increase (decrease).)Fiscal 2020
Fiscal 2019

Net Sales(¥ million)
20,40521,321

%
(4.3)
0.7

Net Income per Share
Fiscal 2020
Fiscal 2019

(¥)
58.25
71.73

Operating Income(¥ million)%(36.5)
1,142
1,799
33.9

Ordinary Income(¥ million)%(22.4)
2,218
2,856
21.0

Net Income(¥ million)%(18.5)
1,685
2,068
13.2

Shareholders' Equity Ratio
%
54.1
60.5

Net Assets per ShareNet Income per Share(Diluted)
(¥)
57.56
70.78

(2) Non-Consolidated Financial Position
Total Assets
Net Assets(¥ million)(¥ million)
March 31, 2020
35,19819,218March 31, 2019
29,325
17,927
Reference: Shareholders' equity Fiscal 2020: ¥19,048 million
Fiscal 2019: ¥17,735 million(¥)
655.23614.592. Non-Consolidated Financial Forecasts for Fiscal 2021 (April 1, 2020 to March 31, 2021)

We have not yet determined consolidated financial forecasts for fiscal 2021 because it is difficult at this time toreasonably assess the impact of the COVID-19 outbreak.
We will release the forecasts for fiscal 2021 promptly as soon as it becomes possible to do so.
*This consolidated financial report is not subject to auditing by a certified public accountant or an audit firm.

*

Explanation concerning the appropriate use of forecasts and other special instructions
Disclaimer:
Results forecasts and other forward-looking statements contained in this report are based on assumptions, beliefs, anduncertainties in light of information available to the Company's management as of the publication date. Actual results may
differ materially from forecasts due to a variety of factors. Therefore, the Company does not guarantee the accuracy of
forecasts and other forward-looking statements and its ability to achieve stated targets. Please refer to "1. OVERVIEW OFOPERATING RESULTS (1) Overview of Operating Results for Fiscal 2020" on page 2 of the attachment materials for
information regarding the underlying assumptions for financial results forecasts and an explanation concerning the appropriate
use of forecasts and other notes.

Attachment Materials: Table of Contents
1. OVERVIEW OF OPERATING RESULTS ............................................................................................................. 2(1) Overview of Operating Results for Fiscal 2020 ................................................................................................. 2(2) Overview of Financial Position for Fiscal 2020 ................................................................................................. 4(3) Overview of Cash Flows for Fiscal 2020 ........................................................................................................... 4(4) Outlook for Fiscal 2021 ..................................................................................................................................... 5(5) Basic Policy Concerning the Allocation of Profits and Dividends for Fiscal 2020 and Fiscal 2021 .................. 5
2. OVERVIEW OF THE CORPORATE GROUP ....................................................................................................... 6
3. BASIC APPROACH TO THE SELECTION OF ACCOUNTING STANDARDS ................................................ 7
4. CONSOLIDATED FINANCIAL STATEMENTS AND NOTES ........................................................................... 8(1) Consolidated Balance Sheets ............................................................................................................................. 8(2) Consolidated Statements of Income and Comprehensive Income ................................................................... 10(Consolidated Statements of Income) ..............................................................................................................10(Consolidated Statements of Comprehensive Income) .................................................................................... 11(3) Consolidated Statements of Changes in Net Assets ......................................................................................... 12(4) Consolidated Statements of Cash Flows .......................................................................................................... 14(5) Notes to Consolidated Financial Statements .................................................................................................... 15(Notes on Going Concern Assumptions) ..........................................................................................................15(Segment Information) .....................................................................................................................................15― 1 ―1. OVERVIEW OF OPERATING RESULTS(1) Overview of Operating Results for Fiscal 2020
While the Japanese economy during the first six months of the consolidated fiscal year under review
continued on a moderate recovery trend, its real GDP growth rate in the October-December 2019 period turned
negative for the first time in five quarters, due to a fall in domestic demand after the increase in consumption tax
implemented in October 2019 as well as the damage brought on by Typhoon Hagibis in the same month. In
addition, since the beginning of 2020, the serious slowdown of the global economy caused by the worldwide
spread of COVID-19 is now certain to lead to a significant downturn for the Japanese economy.
In the housing sector, interest rates on housing loans continue to remain at low levels and the overall
environment surrounding housing purchases remains favorable, but the customer mindset regarding housingpurchases turned cautious, due to the increase in consumption tax and housing damage caused by flooding
brought on by Typhoon Hagibis that affected a vast area of eastern Japan. Furthermore, customer activities
remained sluggish due to voluntary restraints being imposed on corporate activities and going out in order toprevent the spread of COVID-19.
Under these circumstances, the Grandy House Group continued to strive to expand and reinforce businessunder the basic policy in its second medium-term business plan (from the fiscal year ended March 2019 to thefiscal year ending March 2021) of "continuous growth through reinforcing the core operation (new homes)" and"expansion of business through enhancing the stock business."
With regard to new home sales, one of our core operations, we worked on measures such as reinforcing ourorganizational structures and expanding our business area into Saitama Prefecture. Furthermore, we acquired
shares in two business companies in Kawasaki City and made them subsidiaries for the purpose of expanding into
Kanagawa Prefecture. In existing home sales, we continued the effort to build up product inventory toward
expanding home sales.
In the three months ended December 31, 2019, however, due to the negative impact of the dampened
consumer mindset brought on by the increase in consumption tax and by the flooding damage caused by Typhoon
Hagibis, the level of orders that we received remained low. This forced us to revise down the financial result
forecasts at the beginning of fiscal 2020 (revision release date: February 10, 2020). In the three months ended
March 31, 2020, the orders that we received for new homes recovered to a level higher than that for the samequarter in the previous year, although the spread of COVID-19 started to have a minor effect in March.
Consequently, our consolidated net sales for the fiscal year under review increased slightly. On the other hand,profit declined year-on-year due to factors such as the following: an increase in personnel expenses associatedwith investing in human resources with the aim of expanding operations in the future; M&A expenses;
amortization of goodwill; and valuation losses recorded on shareholdings due to a fall in share prices following
the spread of COVID-19.
As a result of these initiatives, the Grandy House Group's results for the consolidated fiscal year ended March
31, 2020 were as follows. Net sales were ¥45,541 million, an increase of 2.5% year-on-year; operating income
decreased to ¥2,142 million, a decrease of 31.6% year-on-year; ordinary income was ¥2,310 million, a decreaseof 29.7% year-on-year; and net income attributable to owners of the parent totaled ¥1,413 million, a decrease of
31.6% year-on-year.
Results by business segment are presented as follows.
a. Real Estate Sales
In the new home sales, we endeavored to achieve a recovery in orders received by reinforcing our sales
activities through measures such as reviewing the organization and structure of subsidiaries that failed to achieve
the sales plan in the previous period. Furthermore, toward expanding sales, we continued to strengthen sales
promotion activities with a focus on efforts toward early sales of strategic large housing lots such as Yotsuba no
Mori housing lots (211 lots in Tsukuba, Ibaraki Prefecture) and GRAND BEAT PARK Kaminokawa (141 lots in
Kaminokawamachi, Tochigi Prefecture). As a result, we achieved our goal of selling out all of the lots in Yotsubano Mori before the end of the period under review. In terms of products, we continued to differentiate our
products from those of our competitors by pursuing our "Townscape creation" policy that gave a theme to eachhousing lot and harmonized the distinctive appearance of homes and the uniform image of the housing lot, andthrough products with superior design, functionality, energy saving and safety, we initiated a new undertaking in
Saitama Prefecture by adopting a plan with standardized air-conditioning system for the entire house.
― 2 ―As for expanding our sales area, although we opened the Saitama Branch (Saitama in Saitama Prefecture) in
the previous fiscal year to purchase housing lots, we subsequently reorganized the branch into the Saitama
Regional Office to establish an internal sales department in April 2019 and started selling completed homes. In
addition, the company focused on PMI (Post Merger Integration) for Plaza House Inc. (Kawasaki in Kanagawa
Prefecture) and Welcome House Inc. (Kawasaki in Kanagawa Prefecture) in the real-estate sales and brokeragebusiness, which the company made subsidiaries in July 2019, with the aim of advancing into the Kanagawa
Prefecture market and expanding its business within the prefecture.
However, orders received during the three months ended December 31, 2019 remained challenging due to theincrease in consumption tax in October 2019 and the dampened mindset of consumers, especially those in
Tochigi Prefecture, following the flooding damage caused in an extensive area by Typhoon Hagibis. In the threemonths ended March 31, 2020, while the number of homes sold (delivered) recovered to produce an all-timequarterly high, this was unable to make up for the weak figures of the previous quarter. Consequently, the total
number of new housing units sold in the consolidated fiscal year under review came in at 1,341 units (down 14
units year-on -year).
In existing home sales, we continued making efforts to expand existing home sales, and so on by enhancing
product inventory. Amid competition intensifying in the field of purchasing, we achieved our target of keeping 80
completed homes in inventory at any one time due to our efforts to reinforce procurement and shorten the timerequired for renovation after purchase. Consequently, orders received continued to exceed the level recorded in
the previous period, but the total number of existing homes sold in the consolidated fiscal year under review camein at 151 units (the same number as that for the previous fiscal year) because of the number of orders received
that were due to be delivered in the next fiscal year.
As a result of these initiatives, sales in the real estate sales segment for the consolidated fiscal year underreview increased 3.1% year-on-year to ¥42,505 million despite a decline in the number of new homes sold. Thiswas due to an improvement in the sales composition, with a higher percentage of sales in areas such as the Tokyo
metropolitan area where sales prices are higher, and the sale of 17 lots of land in Kanagawa Prefecture.
Meanwhile, segment profit decreased to ¥2,013 million, down 32.4% year-on-year.
b. Construction Material Sales
In the construction material sales, a decrease in built-for-rent housing starts and owner-occupied housing
starts has been widely noted since the consumption tax hike, resulting in a downward trend in new housing starts
for wooden houses. Since the start of 2020, built-for-sale housing starts have also experienced a substantial
decrease due to factors such as the stagnant consumption caused by the spread of COVID-19 and delays toconstruction work caused by the supply chain disruptions experienced in the housing sector as well.
Under such circumstances, the Grandy House Group has been making efforts to improve the gross margin of
pre-cut materials, which are the group's main products, and to increase orders received for building andconstruction materials for housing. Net sales declined because the selection of customers and other measures
were conducted in an effort to ensure profitability, among the intensified competition due to the decreased
number of wooden housing starts. Meanwhile, profit decreased due to an increase in personnel expenses
associated with the addition of manpower starting from the end of the previous period and the occurrence of
uncollectible accounts receivable.
As a result of these initiatives, sales in the construction material sales segment during the consolidated fiscal
year under review decreased 7.2% year-on-year to ¥2,775 million. Segment profit was ¥142 million, down 5.9%
from the previous fiscal year.
c. Real Estate Leasing
In the real estate leasing, more stores were opened in or relocated to the city center in the office building
market in and around Utsunomiya, which is our main market, and vacancy rates were improving continuously. In
the parking lot market, competition remained intense between parking lots in the vicinity.
In this context, in addition to efforts made to improve the operational rate of existing assets and reducemanagement costs, there was a slight increase in the value of rental assets. Consequently, sales in the real estateleasing segment during the consolidated fiscal year under review were ¥261 million, an increase of 5.2% year-onyear, and segment profit was ¥172 million, an increase of 13.8% year-on-year.
― 3 ―(2) Overview of Financial Position for Fiscal 2020
As of March 31, 2020, total consolidated assets increased to ¥55,986 million, an increase of ¥9,121 million
compared to the end of the previous consolidated fiscal year. This was mainly due to an increase in assets
associated with the incorporation of assets held by the two companies which became our subsidiaries and therecording of goodwill following this acquisition, in addition to an increase in current assets through theacquisition of housing lots and large housing lots, while endeavoring to expand our real estate sales business.
Liabilities increased to ¥33,842 million, up ¥8,102 million compared to the end of the previous consolidated
fiscal year, due mainly to the incorporation of liabilities held by the two companies which became subsidiaries of
the Grandy House Group, coupled with loans to fund the acquisition of the aforementioned housing lots andshares of the two companies. Furthermore, we are making efforts that are continued from the previous fiscal year
to switch our fund procurement method to financing by bonds for part of our loans in order to reduce the burdenof interest payments and to flexibly use funds.
Total net assets stood at ¥22,143 million as of March 31, 2020. This represents an increase of ¥1,018 million
from the balance recorded as of March 31, 2019. This is mainly due to the acquisition of net income attributableto owners of the parent despite the payment of dividends.
(3) Overview of Cash Flows for Fiscal 2020
Cash and cash equivalents (hereinafter, "cash flows") as of March 31, 2020 increased by ¥335 million
compared to the end of the previous consolidated fiscal year, as a result of decreased cash flows from operating
and investing activities and increased cash flows from financial activities, to reach ¥10,336 million.
Factors contributing to movements in the Company's cash flows during the consolidated fiscal year underreview are presented as follows.
(Cash Flows from Operating Activities)
Net cash used in operating activities amounted to ¥2,546 million (an increase of ¥3,042 million in theprevious fiscal year). This was mainly due to an increase in inventory as a result of the acquisition of large
housing lots and others, as mentioned above despite an increase in net income before income taxes.
(Cash Flows from Investing Activities)
Net cash used in investing activities amounted to ¥2,520 million (a decrease of ¥503 million in the previous
fiscal year). This was mainly due to the acquisition of shares in subsidiaries and the acquisition of real estate forleasing, and other items.
(Cash Flows from Financing Activities)
Net cash provided by financing activities amounted to ¥5,402 million (a decrease of ¥2,351 million in theprevious fiscal year). This was mainly due to an increase in loans payable associated with an increase ininventory and the acquisition of shares in subsidiaries, and so on, despite the payment of dividends. As mentioned
above, we switched our fund procurement method to financing by bonds for part of our loans.
Trends in the Group's cash flow-related indices are presented as follows.
Fiscal 2018
Shareholders' equity ratio (%)
Equity ratio on market value basis (%)
Interest-bearing liabilities to cash flow ratio (years)
Interest coverage ratio (times)

Fiscal 2019
41.0
27.5
10.3
7.0

Fiscal 2020
44.7
27.5
6.7
12.3

Shareholders' equity ratio: Shareholders' equity/total assets
Equity ratio on a market value basis: Market capitalization/total assets
Interest-bearing liabilities to cash flow ratio: Interest-bearing liabilities/cash flows
Interest coverage ratio: Cash flows/interest payments
Notes: 1. Each index is calculated based on consolidated financial data.
2. Market capitalization is calculated based on the number of issued shares as of the period-end (after
deducting treasury shares).
― 4 ―

39.2
18.6
—
—

3. Cash flows from operating activities are used as "cash flows" in the above calculation. As operating cash
flows for the fiscal year ended March 31, 2020 were negative, interest-bearing liabilities to cash flow ratio
and interest coverage ratio data have been omitted for the year.
4. Interest-bearing liabilities include all liabilities that bear interest under the liabilities section recorded on
consolidated balance sheets.
(4) Outlook for Fiscal 2021
Currently, it is not possible to predict when the COVID-19 outbreak will subside in Japan, and this may havea material impact on our financial position and results for the fiscal year ending March 31, 2021. As it is difficult
to produce reasonable estimates of the outbreak's impact at this time, we are not providing consolidated financial
forecasts or an annual dividend forecast.
We will release the forecasts for fiscal 2021 promptly as soon as it is possible to calculate them.
(5) Basic Policy concerning the Allocation of Profits and Dividends for Fiscal 2020 and Fiscal 2021
Grandy House focuses on increasing the corporate value and returning more profits to shareholders as one ofits priority management issues. For shareholders, we will follow a dividend policy that is based on businessperformance and work to enhance the policy while aiming for a consolidated dividend payout ratio of 30%.
Purchase of treasury shares will be made in a timely manner and in accordance with the Company's financial
position in order to enhance shareholder returns and capital efficiency.
Based on the policy above, Grandy House has declared an annual dividend of ¥23 per share for the fiscal year
under review as was originally forecast, even though the net income for fiscal 2020 did not reach the target figure
used as the basis for the original dividend forecast. We will announce the annual dividend forecast for the fiscal
year ending March 31, 2021 together with financial forecasts as soon as it is possible to calculate them.
Under its Articles of Incorporation, Grandy House has adopted a flexible and fluid approach toward thepayment of dividends from surplus based, which is subject to a resolution of the Company's Board of Directors.
In accordance with standard practice, however, Grandy House plans to continue paying a single annual dividend
to shareholders of record as of March 31 each year.

― 5 ―2. OVERVIEW OF THE CORPORATE GROUP
The Grandy House Group (Grandy House Corporation and its affiliates) consists of Grandy House Corporation andeight subsidiaries. The Group is mainly engaged in real estate sales, construction material sales, and real estate leasing.
The business operations of the Group and the positions of the Grandy House Corporation and its subsidiaries inthose operations are as follows.
(1) Real Estate Sales
The Grandy House Group purchases housing lots, obtains permits and approvals for development, manages
residential construction works, designs and builds houses, and handles sales and after-sales maintenance.
Sales, design, and construction of detached houses, which are our main business, are in general supervised byGrandy House Corporation and its subsidiaries by trading area, from the perspective of promoting region-based
sales. General sales areas of each company are as follows:
Grandy House Corporation: Tochigi Prefecture, western part of Ibaraki Prefecture, and Saitama Prefecture
Ibaraki Grandy House Co., Ltd.: Ibaraki Prefecture (excluding the western part)
Gunma Grandy House Co., Ltd.: Gunma Prefecture
Chiba Grandy House Co., Ltd.: Chiba Prefecture
Plaza House Inc.: Kanagawa Prefecture
Welcome House Inc.: Kanagawa Prefecture
As we acquired all of the shares in Plaza House Inc. and Welcome House Inc. in the consolidated fiscal year
under review, these two companies are included in the scope of consolidation.
Furthermore, Chuko Jutaku Joho Kan Co., Ltd. is engaged in sales of existing homes and Grandy ReformCo., Ltd. is engaged in the after-sales maintenance and renovation business.
(2) Construction Material Sales
General Livetech Co., Ltd. is engaged in sales of construction materials and components, mainly pre-cut
materials.
(3) Real Estate Leasing
Grandy House Corporation and some of its subsidiaries are engaged in the leasing business of tenantbuildings, apartments and other properties owned by these companies, and the parking lot business.
[Business Group Organization Chart] (As of March 31, 2020)
The matters described above are shown in the following Business Group Organization Chart.

Grandy House Corporation
Supply of pre-cut materials, etc.

Sales of pre-cut
materials, etc.

Leasing of houses, stores, and buildings and the parking lot business

General Livetech Co., Ltd.
Sales of existinghomes, etc.

Renovation

Sales of detachedhouses, etc.
(Kanagawa Prefecture)

After-sales maintenance

Chuko Jutaku Joho Kan Co., Ltd.

Grandy Reform Co., Ltd.

Plaza House Inc.
Welcome House Inc.

Entrustment of after-sales maintenance

Sales of detached houses, etc.
(Ibaraki, Gunma, and Chiba Prefectures)

Sale of detached houses, etc. (Tochigi Prefecture, etc.)

Ibaraki Grandy House Co., Ltd.
Gunma Grandy House Co., Ltd.
Chiba Grandy House Co., Ltd.

Customers
Construction
material sales

Real estate sales― 6 ―Real estateleasing

3. BASIC APPROACH TO THE SELECTION OF ACCOUNTING STANDARDSAt present, the Grandy House Group operates its business only in Japan and most of its stakeholders areshareholders, lenders, and business partners in Japan. There is no plan to raise funds from overseas markets. Against
this background, the Group will prepare its consolidated financial statements based on Japanese GAAP for the time
being.
For the application of International Financial Reporting Standards (IFRS), we will take adequate actions while
paying attention to various situations inside and outside Japan.

― 7 ―4. CONSOLIDATED FINANCIAL STATEMENTS AND NOTES(1) Consolidated Balance Sheets(Thousands of Yen)
Fiscal 2019
(As of March 31, 2019)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable – trade
Real estate for sale
Costs on uncompleted construction contracts
Real estate for sale in process
Merchandise and finished goods
Raw materials and supplies
Other
Allowance for doubtful accounts

Fiscal 2020
(As of March 31, 2020)

10,001,725
547,282
17,322,784
7,244
7,062,704
244,048
128,188816,802(3,305)

10,351,397
607,498
16,799,116
7,198
13,899,184
238,209
113,833
1,039,355(4,934)

36,127,474

43,050,859

5,232,271(2,030,651)

5,593,578(2,174,587)

Buildings and structures, net

3,201,619

3,418,991

Machinery, equipment and vehicles
Accumulated depreciation

53,496(49,325)

126,568(82,712)

Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation

Machinery, equipment and vehicles, net
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net
Land
Leased assets
Accumulated depreciation
Leased assets, net

4,171

43,855351,017(282,493)

366,090(310,140)

68,52355,9495,576,884
143,586(63,129)

6,002,977
189,864(84,792)

80,456

105,071

1,011

8,411

8,932,666

9,635,258–
80,077

1,302,697
102,366

Total intangible assets

80,077

1,405,064

Investments and other assets
Investment securities
Long-term loans receivable
Deferred tax assets
Other

363,031
13,701
413,834
897,508329,226
35,914457,977
1,045,367(1,030)(9,148)Construction in progress
Total property, plant and equipment
Intangible assets
Goodwill
Other

Allowance for doubtful accounts

1,687,045

1,859,337

10,699,789

12,899,659

Deferred assets
Bond issuance costs

37,51235,593

Total deferred assets

37,51235,593

46,864,776

55,986,112

Total investments and other assets
Total non-current assets

Total assets― 8 ―(Thousands of Yen)
Fiscal 2019
(As of March 31, 2019)

Fiscal 2020
(As of March 31, 2020)

Liabilities
Current liabilities
Accounts payable for construction contracts

3,132,890

3,249,367

Short-term loans payable

17,324,800

22,218,600

Current portion of long-term loans payable

503,345695,958

Current portion of bonds

21,00021,000

Lease obligations

28,36637,323

Income taxes payable

544,514367,350

Provision for warranties for completed construction

85,85370,872

Other758,230

691,928

22,398,999

27,352,399

1,545,000

1,824,000

881,461

3,597,965

Total current liabilities
Non-current liabilities
Bonds payable
Long-term loans payable
Lease obligations

58,58277,603

Provision for directors' retirement benefits

168,654

203,579

Net defined benefit liability

629,972

720,938

Asset retirement obligations

12,227

12,296

Other

45,73054,203

3,341,627

6,490,585

25,740,627

33,842,985

Capital stock

2,077,500

2,077,500

Capital surplus

2,228,898

2,291,248

Retained earnings

17,011,385

17,905,056

Treasury shares(337,899)(301,297)

20,979,883

21,972,507

Valuation difference on available-for-sale securities(47,634)–

Total accumulated other comprehensive income(47,634)–

191,900

170,620

21,124,148

22,143,127

46,864,776

55,986,112

Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity

Total shareholders' equity
Accumulated other comprehensive income

Subscription rights to shares
Total net assets
Total liabilities and net assets― 9 ―(2) Consolidated Statements of Income and Comprehensive Income(Consolidated Statements of Income)(Thousands of Yen)
Fiscal 2019
(From April 1, 2018
to March 31, 2019)

Fiscal 2020
(From April 1, 2019
to March 31, 2020)

Net sales

44,452,833

45,541,961

Cost of sales

36,415,450

37,756,807

Gross profit

8,037,383

7,785,154

Selling, general and administrative expenses

4,906,276

5,643,006

Operating income

3,131,106

2,142,147

Interest income

869

1,409

Dividends income

5,703

5,722

Operations consignment fee

224,634

226,634

Office work fee

Non-operating income

161,523

157,004

Insurance claim income

3,205

50,400Other

27,80527,250Total non-operating income

423,741

468,422

Non-operating expenses
248,648

256,315

Commission for syndicate loan

6,666

8,469

Other

11,33434,986

Total non-operating expenses

266,649

299,7713,288,197

2,310,798

75

1,143

Loss on retirement of non-current assets

16,373

13,151

Loss on cancellation of lease contracts

2,528

9,460

Interest expenses

Ordinary income
Extraordinary loss
Loss on sales of non-current assets

Loss on valuation of investment securities
Directors' retirement benefits
Loss on disaster–

100,000

300,000––

27,767

Total extraordinary loss

318,978

151,521

Net income before income taxes

2,969,219

2,159,276

Income taxes – current

917,064770,234

Income taxes – deferred(13,440)(24,072)

903,623

746,162

Net income

2,065,595

1,413,114

Net income attributable to owners of the parent

2,065,595

1,413,114

Total income taxes― 10 ―

(Consolidated Statements of Comprehensive Income)(Thousands of Yen)
Fiscal 2019
(From April 1, 2018
to March 31, 2019)

Fiscal 2020
(From April 1, 2019
to March 31, 2020)

2,065,595

1,413,114

Valuation difference on available-for-sale securities(43,810)47,634

Total other comprehensive income(43,810)47,6342,021,785

1,460,749

2,021,785

1,460,749––

Net income
Other comprehensive income

Comprehensive income
Comprehensive income attributable to:Comprehensive income attributable to owners of theparentComprehensive income attributable to non-controllinginterests― 11 ―

(3) Consolidated Statements of Changes in Net Assets
Fiscal 2019 (From April 1, 2018 to March 31, 2019)

Capital stock
Balance as of the beginning of the period
Changes of items during the period
Dividends from surplus
Net income attributable to owners of the parent
Exercise of subscription rights to shares
Net changes to items other than shareholder
equityTotal changes of items during the period
Balance as of the end of the period

2,077,500(Thousands of Yen)
Shareholders' equity
Retained
Total shareholders'Capital surplus
Treasury sharesearnings
equity2,223,038
15,407,196(341,339)
19,366,395(461,407)
2,065,595
5,860

3,440

(461,407)
2,065,595
9,300

–

5,860

1,604,188

3,440

1,613,488

2,077,500

2,228,898

17,011,385(337,899)

20,979,883

Subscription
rights to shares

Total net assets

193,900

19,556,471(2,000)(461,407)
2,065,595
7,300

Accumulated othercomprehensive income

Balance as of the beginning of the period
Changes of items during the period
Dividends from surplus
Net income attributable to owners of the parent
Exercise of subscription rights to shares
Net changes to items other than shareholder
equityTotal changes of items during the period
Balance as of the end of the period

Valuationdifference on
availablefor-salesecurities(3,824)

Total
accumulated
othercomprehensive
income(3,824)(43,810)(43,810)(43,810)(43,810)(47,634)(47,634)― 12 ―(43,810)(2,000)191,900

1,567,677
21,124,148

Fiscal 2020 (From April 1, 2019 to March 31, 2020)

Capital stock
Balance as of the beginning of the period
Changes of items during the period
Dividends from surplus
Net income attributable to owners of the parent
Exercise of subscription rights to shares
Net changes to items other than shareholder
equityTotal changes of items during the period
Balance as of the end of the period

2,077,500(Thousands of Yen)
Shareholders' equity
Retained
Total shareholders'Capital surplus
Treasury sharesearnings
equity2,228,898
17,011,385(337,899)
20,979,883(519,443)
1,413,114
62,35036,601–

62,350893,671

36,601

992,623

2,077,500

2,291,248

17,905,056(301,297)

21,972,507

Accumulated othercomprehensive income

Balance as of the beginning of the period

Valuationdifference on
availablefor-salesecurities

Total
accumulated
othercomprehensive
incomeSubscription
rights to shares

Total net assets(47,634)(47,634)

191,900

21,124,148

Changes of items during the period
Dividends from surplus
Net income attributable to owners of the parent
Exercise of subscription rights to shares
Net changes to items other than shareholder
equityTotal changes of items during the period
Balance as of the end of the period(519,443)
1,413,114
98,952(519,443)
1,413,114(21,280)
47,63447,63447,634–47,634–― 13 ―

77,672
47,634(21,280)
170,620

1,018,97822,143,127

(4) Consolidated Statements of Cash Flows(Thousands of Yen)
Fiscal 2019
(From April 1, 2018
to March 31, 2019)
Cash flows from operating activities
Net income before income taxes
Depreciation and amortization
Amortization of goodwill
Increase (decrease) in provision for directors' retirement
benefits
Increase (decrease) in provision for warranties for completed
construction
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in net defined benefit liability
Interest and dividends income
Interest expenses
Loss (gain) on sales of property, plant and equipment
Loss on retirement of non-current assets
Loss (gain) on valuation of investment securities
Decrease (increase) in notes and accounts receivable-trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable-trade
Other
SubtotalInterest and dividends income received
Interest expenses paid
Income taxes paid
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
Purchase of shares in subsidiaries resulting from a change inthe scope of consolidation
Loan advances
Collection of loans receivable
Payments for guarantee deposits
Proceeds from collection of guarantee deposits
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
Repayment of long-term loans payable
Proceeds from issuance of bonds
Redemption of bonds
Proceeds from disposition of treasury shares due to exercise ofsubscription rights to shares
Cash dividends paid
Repayments of lease obligations
Net cash provided by (used in) financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period― 14 ―

Fiscal 2020
(From April 1, 2019
to March 31, 2020)

2,969,219
248,990–

2,159,276
267,613
68,563

2,374

34,924

27,166(15,382)(4,913)58,388(6,572)
248,648
75
16,373–
125,6021,140,337(276,016)(399,835)
4,149,839
8,878(247,794)(868,012)
3,042,911

8,116
90,965(7,131)
256,315
1,143
13,151
100,000(59,800)(3,955,431)(60,075)(226,760)(1,324,512)
8,532(269,978)(960,683)(2,546,641)(491,188)
90,034(37,040)(570,378)
8,779(33,279)–(1,881,900)–
1,157(68,827)2,145–(503,719)(18,000)
39,955(66,096)226(0)(2,520,694)(1,852,900)–(494,513)
500,000(21,000)

2,689,150
3,650,000(740,883)
300,000(21,000)

7,300

77,672(460,176)(30,119)(2,351,408)
187,783
9,813,941
10,001,725(519,435)(33,004)
5,402,500
335,163
10,001,725
10,336,889

(5) Notes to Consolidated Financial Statements(Notes on Going Concern Assumptions)Not applicable.
(Segment Information)
1. Overview of reportable segments
The reportable segments of the Group are components for which separate financial information is available
and whose operating results are regularly reviewed by the Company's Board of Directors when making decisions
about the allocation of management resources and assessing performance.
The Grandy House Group is engaged in the following businesses: new home sales, existing home sales, homerenovation, construction material sales and real estate leasing (all of which are operated in Japan). A portion or
all of operations for new home sales, existing home sales and home renovation are conducted by subsidiaries.
From the perspective of similarity, relationships, and sharing of common management resources, these threebusinesses are regarded as one business segment, Real Estate Sales. The Company devises overall strategies forthis real estate sales segment and conducts business activities.
Accordingly, the Group's three reportable segments are classified as Real Estate Sales, Construction Material
Sales, and Real Estate Leasing.
The Real Estate Sales business includes sales of new homes (including building contract and sale of land,etc.) and existing homes and home renovation. The Construction Material Sales business comprises of production
and sale of pre-cut materials for housing and sale of construction materials and home facilities and equipment. In
the Real Estate Leasing business, activities comprise the leasing of office, homes, related properties, and parking
facilities, etc.
2. Calculation method of net sales, profit and loss, assets, liabilities, and other items by reportable segment
The accounting method for reportable segments complies with the accounting policy that is applied to the
preparation of consolidated accounting statements. Segment profit and loss are based on ordinary income. Intersegment sales or transfers are calculated based on market prices.
3. Information relating to the amounts of net sales, profit and loss, assets, liabilities, and other items byreportable segment
Fiscal 2019 (From April 1, 2018 to March 31, 2019)(Thousands of Yen)

Adjustments(Note 1)

AmountReported on
Consolidated
Financial
Statements(Note 2)44,452,833–

44,452,833

3,207,349(3,207,349)–

Reportable Segment
Real Estate
Sales

Construction
Material Sales

Real Estate
Leasing

41,212,359

2,992,211

248,262–

3,123,472

83,876Total

Net sales
Sales to outside customers
Inter-segment sales and transfers

41,212,359

6,115,684

332,139

47,660,183(3,207,349)

44,452,833

Segment profit

Total

2,976,984

151,461

151,315

3,279,761

8,435

3,288,197

Segment assets

33,466,252

2,109,797

3,578,817

39,154,867

7,709,909

46,864,776

Segment liabilities

24,406,096

1,603,723

69,756

26,079,576(338,948)

25,740,627

Other items
Depreciation and amortization

176,180

26,106

46,704

248,990–248,990

Interest income

863

6

–

869

–

869

Interest expenses

241,3257,322–

248,648–

248,648

Increase in property, plant and equipment
and intangible assets

559,887

10,9375,424

576,249–

576,249― 15 ―

Fiscal 2020 (From April 1, 2019 to March 31, 2020)(Thousands of Yen)

Adjustments(Note 1)

AmountReported on
Consolidated
Financial
Statements(Note 2)45,541,961–

45,541,961

3,203,964(3,203,964)–

346,60248,745,925(3,203,964)

45,541,961

142,588

172,187

2,328,414(17,616)

2,310,798

41,950,386

2,140,471

4,063,879

48,154,737

7,831,374

55,986,112

32,100,985

1,642,918

446,253

34,190,157(347,171)

33,842,985

Depreciation and amortization

193,060

29,48045,072

267,613–

267,613

Amortization of goodwill

68,563––68,563–68,563

Interest income

1,405

3

–

1,409

–

1,409

Interest expenses

248,849

7,024

441

256,315–

256,315

37,304

302,945

688,000–

688,000

Reportable Segment
Real Estate
Sales

Construction
Material Sales

Real Estate
Leasing

42,505,118

2,775,626

261,216–

3,118,577

85,38642,505,118

5,894,204

Segment profit

2,013,639

Segment assets
Segment liabilities

Total

Net sales
Sales to outside customers
Inter-segment sales and transfers
Total

Other items

Increase in property, plant and equipment
347,751
and intangible assets
Note 1: Details of adjustments are presented as follows.

Segment profit(Thousands of Yen)
Fiscal 2019
Eliminations of inter-segment transactions
Total

Fiscal 2020
8,435

(17,616)

8,435(17,616)

Segment assets(Thousands of Yen)
Fiscal 2019

Fiscal 2020

Eliminations of inter-segment receivables(337,184)(345,365)

Eliminations of inter-segment unrealized profit(46,021)(56,859)

8,093,115

8,233,599

7,709,909

7,831,374

Corporate assets
Total* Corporate assets mainly comprise cash and deposits as well as investment securities which are not attributable to reportable segments.

Segment liabilities(Thousands of Yen)
Fiscal 2019
Eliminations of inter-segment payables
Total

Fiscal 2020
(338,948)(347,171)(338,948)(347,171)

Note 2: Segment profit has been adjusted to ordinary income described in consolidated financial statements.

― 16 ―