Summary of Business Results for the Fiscal Year Ended March 31, 2020
[Japan GAAP] (Consolidated)
May 13, 2020
Company
JP-HOLDINGS, INC.
Listed on the TSE 1
Stock Code2749
URL: https://www.jp-holdings. co.jp
Representative
Koichiro Furukawa, President and Representative Director
C o n t a c t
Ryoji Tsutsumi, General Manager of Administrative Division
T E L: +81-52-933-5419
Expected date of annual shareholders’ meeting: June 25, 2020
Expected starting date of dividend payment: June 26, 2020
Expected date of filing of annual securities report: June 26, 2020
Preparation of supplementary financial document: Yes
Results briefing: Yes (for media members, institutional investors, analysts)（Rounded down to million yen）

１. Consolidated business results for the fiscal year ended March 2020
(April 1, 2019 through March 31, 2020)(1) Consolidated results of operations(% change from the previous corresponding period)
Net sales

Operating income

Million yen% Million yen
Year ended Mar. 2020
31,7198.3
1,538
Year ended Mar. 201929,2989.4
1,531(Note) Comprehensive income:Year ended March 2020: 1,036 million yen (9.0%)
Year ended March 2019: 950 million yen (7.0%)
Net income
per share

%
0.5
17.5

Diluted net income
per share

Yen
12.81
12.44

Year ended Mar. 2020
Year ended Mar. 2019

Ordinary income
Million yen
2,003
1,920

Return on
equity

Yen
-

%
12.1
12.8

%
4.3
21.4

Net income attributable toowners of parent

Million yen
1,122
1,071

Ratio of ordinary
income to total
assets
%
7.4
7.1

%
4.8
17.7

Ratio of operating
income to net sales
%
4.9
5.2

(2) Consolidated financial position
Total assets

Net assets

Million yen
As of Mar. 31, 2020
26,122As of Mar. 31, 201928,255(Reference) Shareholders’ equity:
As of March 31, 2020: 9,636 million yen
As of March 31, 2019: 8,950 million yen

Shareholders’ equity
ratio

Million yen
9,636
8,950

Net assets per
share

%
36.9
31.7

Yen
110.17102.23(3) Consolidated results of cash flows

Year ended Mar. 2020
Year ended Mar. 2019

Cash flows fromoperating activities
Million yen
2,320
1,829

Cash flows frominvesting activities
Million yen
418
-940

Cash flows fromfinancing activities
Million yen-3,3491,475

Cash and cash equivalents
at the end of period
Million yen
6,206
6,816

2. Dividends
Annual dividend
End of
1Q

End of2Q

End of3Q

Year-end

Total

Total
dividend(Total)Dividend
payout ratio(Consolidated)

Rate of total
dividend to
net assets(Consolidated)
%
3.8
3.7

Yen
Yen
Yen
Yen
Yen
Million yen%
Year ended Mar. 2019
0.00
3.70
3.70
325
29.7
Year ended Mar. 2020
0.00
3.90
3.90
341
30.4
Year ending Mar. 2021
3.90
3.90
29.3
(forecast)(Note) The total amount of dividends includes 1 million yen for the fiscal year ended March 2019, as the dividend on the company's share held byTrust & Custody Services Bank, Ltd. as trust property of "Stock Benefit Trust (Employee Stock Ownership Plan)".

3．Forecast of consolidated business results for the fiscal year ending March 2021
(April 1, 2020 through March 31, 2021)(% change from the previous corresponding period)
Net sales

Operating income

Million yen

Year ending Mar. 2021

33,005

Net income attributableto owners of parent

Ordinary income%

Million yen

%

4.1

1,577

2.5

Million yen

2,153

Net income
per share%

Million yen

%

Yen

7.5

1,163

3.6

13.30

*Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries accompanying changes
in the scope of consolidation): None
(2) Changes in accounting policies, accounting estimates and restatement①Changes in accounting policies associated with revision of accounting standards:②Changes in accounting policies other than ①③Changes in accounting estimates④Restatement: None: None: None: None(3) Shares outstanding (common stock)① Number of shares outstanding at the end of period (treasury stock included)
As of March 31, 2020
87,849,400 shares
As of March 31, 201987,849,400 shares② Treasury stock at the end of period:
As of March 31, 2020
380,707 shares
As of March 31, 2019297,807 shares③ Average number of stock during period
Year ended March 31, 2020
87,649,993 sharesYear ended March 31, 201986,097,870 shares(Note) The number of treasury stock deducted for the calculation of the number of treasury stock at the end of period and theaverage number of stock during period includes the company's shares held by Trust & Custody Services Bank, Ltd. as
trust property of "Stock Benefit Trust (Employee Stock Ownership Plan)".

(Reference) Summary of non-consolidated business results
1. Non-consolidated business results for the fiscal year ended March 2020
(April 1, 2019 through March 31, 2020)(1) Non-consolidated results of operations(% change from the previous corresponding period)
Year ended Mar. 2020
Year ended Mar. 2019

Net sales
Million yen
2,360
1,896

%
24.4
6.6

Operating income
Million yen
%
620
0.7
616
49.6

Yen
8.39
5.67

Diluted net income per
share
Yen
-

Net income
per share
Year ended Mar. 2020
Year ended Mar. 2019

Ordinary income
Million yen
%
905
36.2
664
9.9

Net income
Million yen
%
734
50.5
488
12.5

Shareholders’ equity
ratio

Net assets per
share(2) Non-consolidated financial position
Total assets
Million yen
As of Mar. 31, 2020
17,106
As of Mar. 31, 201919,923(Reference) Shareholders’ equity:
As of March 31, 2020: 5,197 million yen
As of March 31, 2019: 4,902 million yen

Net assets
Million yen
5,197
4,902

%
30.4
24.6

Yen
59.42
56.00

* Financial summary is not subject to auditing procedures by certified public accountants or auditing firms.
* Explanation regarding appropriate use of business forecasts and other special instructions
・Forecasts regarding future performance in this material are based on information currently available to the Company and certain assumptions that thecompany deems to be reasonable at the time this report was prepared. Actual results may differ significantly from the forecasts due to various factors.
For information regarding the business forecasts, etc., please refer to “1. Qualitative Information on Quarterly Financial Results (4) Future outlook”(Page 5).
・On Tuesday, May 19, 2020, the Company plans to hold results briefing for media members, institutional investors and analysts via a webcast. The
Company has suspended its results briefing for individual investors in order to prevent the spread of new coronavirus (COVID-19) infections.

○ Table of Contents of the Appendix
1. Summary of Operating Results…………………………………………………………………………………2(1) Summary of operating results for the current fiscal year……………………………………………………..2(2) Summary of financial condition in the current fiscal year……………………………………………………3(3) Summary of cash flow in the current fiscal year……………………………………………………………...4(4) Future outlook…………………………………………………………………………………………………6
2. Basic Policies Regarding the Selection of Accounting Standards……………………………………………….7
3. Consolidated Financial Statements and Major Notes……………………………………………………………8(1) Consolidated Balance Sheet……………………………………………………………………………………8(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income…………………10(3) Consolidated Statements of Changes in Shareholders’ Equity………………………………………….…….12(4) Consolidated Statement of Cash Flows…………………………………………………………………….…14(5) Notes on the consolidated financial statements……………………………………………………………….16(Notes on going concern assumption) …………………………………………………………….…………16(Additional information) ……………………………………………………………………………………..16(Segment Information) ………………………………………………………………………………….……16(Per-stock Information) ………………………………………………………………………………………16(Significant subsequent events) ………………………………………………………………………………17

1

1. Summary of Operating Results(1) Summary of operating results for the current fiscal year
In the fiscal year under review, the Japanese economy has continued to improve and has been on a gradual recovery trend as theenvironment or both employment and personal income is improving. However, the outlook remains unclear due to the uncertainty
in the global economy caused by the slowdown of the Chinese economy and the worsening situation in the Middle East countries,
as well as concerns about a decline in consumption caused by the consumption tax hike.
In addition, the global spread of the new coronavirus (COVID-19) infections from the beginning of the year has had a serious
impact on domestic and international economic activities.
As for the environment surrounding the child-raising service, the employment rate of women has been rising due to women's
advancement and active participation in society and various measures by the government to promote their participation in theworkplace, so demand for the child-raising service continues to be high. With the implementation of free child education andchildcare from October 2019, it is anticipated that people looking for entry into childcare facilities will increase, and the Company
believes that the social role played by child-raising service will become more important than ever. With the aim of meeting thisdemand, it is still difficult to secure nursery school teachers, who are responsible for supporting childcare, mainly in the Tokyo
metropolitan area. From the beginning of March, elementary and junior high schools were closed all at once due to the COVID-19,
and a safe and secure management system is required, while expanding the system for accepting children.
Under these circumstances, the Group is continuing to expand its share of the market in collaboration with local governments
throughout Japan, while working to secure nursery teachers, which is our urgent priority, and to further improve the quality ofchildcare services.
In addition, under the "hands-on policy", the Company is collecting issues at each facility and workplace and working on
improvements and reforms to create a comfortable working environment. This has led to an increase in the number of nurseryteachers hired and an increase in the retention rate. In addition, as a measure for efficient and effective organizational management,
the Company has introduced a Block System that divide Japan into the 5 operating areas to take careful measures, and haveworked to develop new businesses for sustainable growth.
As for the measures against COVID-19 infections, the Company established a COVID-19 Control Headquarters. Whilecoordinating with local governments, the Company gives top priority to ensuring the safety of children as well as the safety ofparents, business partners and employees. Each facility establishes its own strict safety standards. These include body temperature
measurement, hand washing, gargling and alcohol disinfection every morning, as well as wearing masks. The head office andTokyo Headquarters have introduced flexible work hours and telework systems to ensure quick response.
Along with the promotion of various measures, the Group has opened a total of 12 facilities in the fiscal year under review,
including 10 nursery schools (9 in Tokyo, 1 in Shiga) and 2 school clubs (2 in Tokyo), in order to promote various measures andrespond to the growing needs of nursery facilities.
As a result, the Group came to have 209 nursery schools, 72 school clubs, 11 children's houses, 4 private school clubs, and 1
kindergarten (overseas facility), making a total of 297 facilities for supporting child-raising at the end of March 2020.
With the establishment of the Wakuwaku Fukuro Hiroba/Akakita Hibari Club No. 2, the Akakita Hibari Club and the Kita City
Fukuro Cultivation Room are renamed as the Wakuwaku Fukuro Hiroba/Akakita Hibari Club No. 1 and the Wakuwaku Fukuro
Hiroba /Akakita Hibari Club No. 3, respectively, as of April 1, 2019.
Separate from the new facilities, the following changes have been made as of April 1, 2019: Asc Ikegami Nursery School, which
had been running since February 1, 2008 as an existing Tokyo Licensed Nursery School was changed into a licensed nurseryschool; Asc Toyotama 1-chome Nursery School A and B, which had been running since April 1, 2018, as small-scale childcare
facilities, were integrated and changed into a licensed nursery school; and Kawasaki City Miyamaedaira Nursery School, which
had been running as a public facility under private management since April 1, 2009, was changed to a private facility under private
management and is now run as Asc Miyamaedaira Nursery School.
As a result, the Group’s consolidated net sales were 31,719 million yen (up 8.3% year on year), operating income was 1,538
million yen (up 0.5% year on year), ordinary income was 2,003 million yen (up 4.3% year on year), and net income attributable to2

owners of parent was 1,122 million yen (up 4.8% year on year).

The major factors are as follows:
Net sales increased year on year, mainly due to the opening of new facilities, an increase in the number of children accepted atexisting facilities, and an increase in rent subsidies at some existing facilities.
Operating income and ordinary income increased year on year, thanks to an increase in operating income and increased subsidies
associated with an increase in users of the corporate dormitory, in addition to the above-mentioned factors of increased sales due toan increase in the number of children accepted at existing facilities.
In terms of net income attributable to owners of parent, the Company recorded an extraordinary loss of 315 million yen due to theimpairment of fixed assets related to childcare facilities that are expected to have a long payback period and the introduction of a
new attendance management system.

(2) Summary of financial condition in the current fiscal year
As for the financial position at the end of the current fiscal year, the total assets amounted to 26,122 million yen (down 2,132
million yen from the end of the previous fiscal year).
Current assets totaled 9,788 million yen (down 670 million yen), mainly reflecting an increase of 59 million yen in others, while
there were decreases of 609 million yen in cash and deposits, and 81 million yen in accounts receivable.
Fixed assets totaled 16,334 million yen (down 1,462 million yen). This was mainly due to an increase of 303 million yen indeferred tax assets, while there were decreases of 939 million yen in construction in progress, 349 million yen in buildings andstructures, 171 million yen in investments and other assets, 135 million yen in long-term loans receivable, and 111 million yen in
investment securities.
Total liabilities amounted to 16,486 million yen (down 2,818 million yen).
Current liabilities totaled 5,920 million yen (down 1,959 million yen), mainly due to increases of 143 million yen in provision forbonuses and 36 million yen in accrued consumption taxes, while there were decreases of 1,500 million yen in short-term loans
payable, 526 million yen in current portion of long-term loans payable, and 52 million yen in others.
Fixed liabilities totaled 10,565 million yen (down 858 million yen), mainly due to an increase of 114 million yen in obligations for
retirement plan, while there was a decrease of 974 million yen in long- term loans payable.
Total net assets as of the end of the current fiscal year totaled 9,636 million yen (up 685 million yen from the end of the previous
fiscal year), mainly because retained earnings increased by 797 million yen, while valuation difference on securities decreased by
91 million yen.

3

(3) Summary of cash flow in the current fiscal year
Cash and cash equivalents (hereinafter referred to as “the funds”) for the current consolidated fiscal year were 2,320 million yen
from the funds obtained through operating activities; 418 million yen obtained through investing activities; and 3,349 million yen
paid out in financing activities, totaling 6,206 million yen, down 609 million yen from the end of the previous fiscal year.
The cash flow situations and their reasons for the current consolidated fiscal year are as follows:[Cash flows from operating activities]
The funds provided by operating activities were 2,320 million yen (1,829 million yen was provided during the previous consolidated
fiscal year).
This is due to the following: net income before income taxes and others of 1,688 million yen; depreciation costs of 724 million yen;
impairment loss of 311 million yen; decrease in other fixed assets of 152 million yen; and increase of 143 million yen in provision
for bonuses ; but there were income taxes paid or refund of 98 million yen.
Compared to the previous consolidated fiscal year, the funds obtained increased by 491 million yen. This is due to the following:
despite increases of 259 million yen in accounts receivable, 202 million yen in impairment loss, and 168 million yen in other fixed
assets, there were decreases of 136 million yen in income taxes paid or refund, 121 million yen in net income before income taxes,
and 83 million yen in notes and accounts payable-trade.
[Cash flows from investing activities]
The funds provided by investing activities were 418 million yen (940 million yen was used during the previous consolidated fiscal
year).
This is due to the following: despite the proceeds from subsidy income of 1,208 million yen and income through the collection of
long-term loans receivable of 263 million yen, there were expenditure towards purchase of property, plant and equipment of 865
million yen; long-term loan expenditures of 120 million yen; and payments for guarantee deposits of 51 million yen.
Compared to the previous consolidated fiscal year, net cash provided increased by 1,359 million yen. This is due to the following:
despite expenditures towards purchase of property, plant and equipment of 1,011 million yen, long-term loan expenditures of 240
million yen, increase of 149 million yen in proceeds from subsidy income, there was a decrease of 29 million yen in intangible fixed
assets.
[Cash flows from financing activities]
The funds used in financing activities were 3,349 million yen (1,475 million yen was provided during the previous consolidated
fiscal year).
This is due to the following: despite proceeds from long-term loans payable of 700 million yen, proceeds from short-term loans
payable of 100 million yen, and proceeds from disposal of treasury stock of 81 million yen, there were repayment of long-term loans
payable of 2,201 million yen, repayment of short-term loans payable of 1,600 million yen, cash dividends paid of 322 million yen,and purchase of treasury stock of 107 million yen.
Compared to the previous consolidated fiscal year, net cash decreased by 4,824 million yen. This is due to the following: despite
increases of 3,900 million yen in repayment of short-term loans payable and 597 million yen in repayment of long-term loans
payable, there were decreases of 5,400 million yen in proceeds from short-term loans payable, 3,300 million yen in proceeds fromlong-term loans payable, and 498 million yen in proceeds from disposal of treasury stock.
The related index of our Group’s cash flow is as follows:
FY3/18
Shareholders’ equity ratio (%)
Shareholders’ equity ratio against
current price (%)

FY3/19
30.1

31.7

36.9

102.6

94.2

86.7

6.9

7.7

4.8

37.3

33.3

38.8

Cash flow to interest-bearing debts
ratio (years)
Interest coverage ratio (x)FY3/20Notes: Shareholders’ equity ratio = shareholders’ equity/total assets
4

Shareholders’ equity ratio against current price = total current stock price/total assets Cash flow to interest-bearing debts
ratio = interest-bearing debts/cash flow
Interest coverage ratio = cash flow/interest payment[Note 1] All calculated based on consolidated fiscal amounts.
[Note 2] Total current stock price calculated based on the total number of stocks issued minus treasury shares.
[Note 3] Cash flow here signifies operating cash flow.
[Note 4] Interest-bearing debts here include all the debts that incur interests and appropriated on the consolidated balance
sheet.

5

(4) Future outlook
The outlook for domestic and overseas economies and corporate activities is uncertain due to the worldwide spread the COVID-19
infections. As a result, the business environment is expected to change significantly compared with the environment in the fiscal year
ended March 2020.
In regard to the child-raising service business, the number of dual-income households is increasing as more women are entering theworkforce due to changes in women's awareness of social participation and the promotion of women's active participation in theworkforce by the government. Demand for childcare continues to be high due to free child education and childcare from October
2019 introduced from October last year. However, some facilities (nursery schools, school clubs, children's houses) were temporarilyclosed at the request of the local governments following the central government’s “State of Emergency” on April 7, 2020, in order tocurb the COVID-19 infections. But many facilities were not affected and continued to operate safely despite the challenging
environment.
In view of the severe business environment, the Company released the "Notice Concerning Review of Medium-Term Management
Plan" on May 13, 2014. The plan runs from March 2019 through March 2021. Some of its facilities (nursery schools, school clubs,
children's houses) may be closed, until the end of May due to the spread of the COVID-19. The Company is reviewing the impact of
the COVID-19 on its operations as the Company does not anticipate any increase in enrollment until July. Plans also call for slowing
down openings of new facilities in view of the pandemic.
Concrete measures to assure that JP Holdings operates the facilities of choice include "further improvement of the quality of childraising service." This is to be achieved by strengthening human resource development, enhancing the capabilities required for every
job category and every grades of kids, introducing a human resource management system and creating a comfortable working
environment to reduce turnover. In addition, “structural reform” will be introduced to improve profitability and operating efficiency
by optimizing enrollment levels and staff assignments at existing facilities. We will reduce operating and indirect costs and establish
a solid profit base by expanding new businesses for sustainable growth. Sales and ordinary income are likely to fall short of theinitial plan due to the impact of the COVID-19, restraint of new facility openings, the cost of the introduction of human resources
system, and other factors. The Company will strive to maximize profits by optimizing income at existing facilities and promoting
structural reforms.
Moreover, in order to ensure safety and security and prevent the spread of COVID-19, the Company plans to establish management
systems at individual facilities in cooperation with the local governments with jurisdiction over the area in which they operate. Thisinitiative aims at prioritizing the safety of children, parents, business partners, and employees.
For the above reasons, as for the consolidated business forecasts for the next fiscal year, the Company forecasts net sales of 33,005
million yen (up 4.1% year on year), operating income of 1,577 million yen (up 2.5%), ordinary income of 2,153 million yen (up7.5%), and net income attributable to owners of parent was 1,163 million yen (up 3.6%).
The following is a breakdown of the childcare facilities that the Group has entrusted with the opening of new facilities during the fiscal
year ended March 2020 and has started new operations on April 1, 2020.
(Nursery school)
Asc Senju Nursery School(Apr. 1, 2020)
Asc Toneri Ekimae Nursery School(Apr. 1, 2020)
Asc Oizumi Gakuen Nursery School(Apr. 1, 2020)
Asc Nerima 3-chome Nursery School(Apr. 1, 2020)(School clubs)
Wakuwaku Yanagida Hiroba/Yanagida Midori Club No. 2
Wakuwaku Yon-iwa Hiroba/Yon-iwa Elementary School Icho Club No. 2
Chofu City Jindaiji Children’s House School Club
Mitaka City Nishiuwa School Club A
Mitaka City Yon-sho School Club B(Apr. 1, 2020)(Apr. 1, 2020)(Apr. 1, 2020)(Apr. 1, 2020)(Apr. 1, 2020)

As of April 1, 2020, with the opening of Wakuwaku Yanagida Hiroba/Yanagida Midori Club No.2, Wakuwaku Yanagida Hiroba wasrenamed as Wakuwaku Yanagida Hiroba/Yanagida Midori Club No.1. With the opening of Wakuwaku Yon-iwa Hiroba/Yon-iwa
Elementary School Icho Club No.2, Wakuwaku Yon-iwa Hiroba was renamed as Wakuwaku Yon-iwa Hiroba/Yon-iwa Elementary
School Icho Club No.1. With the opening of Mitaka City Yon-sho School Club B, Mitaka City Nishiuwa School Club Club was
6renamed as Mitaka City Nishiuwa School Club A.
Separate from the above, the following changes have been made as of April 1, 2020: Asc Higashiojima Nursery School, which had
been running since April 1, 2008 as an existing Tokyo Licensed Nursery School, was changed into a licensed nursery school; Obu
City Kyowahigashi Nursery School, which had been running since April 1, 2010, as public nursery school under private
manegement, was changed into a private facility under private management and is now run as Asc Kyowahigashi Nursery School.
The three private school clubs operated by Amenity Life, Inc. (Elfikids Tsurugamine, Elfikids Futamatagawa, and Elfikids Ryokuentoshi) were closed at the end of March 2020.

2. Basic Policies regarding the Selection of Accounting Standards
Our Group produces the financial statements based on the Japanese standard, while taking into consideration the comparabilities ofvarious financial statement terms as well as those of various companies. Incidentally, the application of international accounting
standards will be appropriately enforced, in consideration of various situations inside and outside Japan.

7

3. [Consolidated Financial Statements and Major Notes](1) [Consolidated Balance Sheet](Thousand yen)Previous Fiscal Year
(March 31, 2019)

Current Fiscal Year
(March 31, 2020)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade

6,816,439
71,657

6,206,487
76,288Inventories
Accounts receivable - other

128,900
2,491,947

111,259
2,410,895

949,963-449

1,009,077-25,759

10,458,459

9,788,250

Other
Allowance for doubtful accounts
Total current assets
Fixed assets
Property, plant and equipment
Buildings and structures

11,873,447

12,237,506

Accumulated depreciation and impairment-4,635,599-5,349,352

Buildings and structures, net

7,237,848

6,888,153

Machinery, equipment and vehicles

5,637

5,637

Accumulated depreciation-3,209-4,146

Machinery, equipment and vehicles, net

2,427

1,490

Tools, furniture and fixtures

803,177

923,279

Accumulated depreciation and impairment-563,703-671,412

Tools, furniture and fixtures, net

239,473

251,866

Land
Construction in progress

980,894
1,437,264

980,894
497,896

Total tangible fixed assets

9,897,908

8,620,302

Intangible assets
Goodwill

227,894

197,508

Other

114,985

50,169Total intangible assets

342,879

247,678

Investment securities
Long-term loans receivable

548,080
3,419,910

436,234
3,284,007

Guarantee deposits
Deferred tax assets

1,880,239
825,742

1,906,120
1,128,962

Other
Allowance for doubtful accounts

891,902-10,027

720,593-9,445

Total investments and other assets

7,555,848

7,466,474

17,796,637

16,334,455

28,255,096

26,122,705

Investments and other assets

Total fixed assets
Total assets8

(Thousand yen)Previous Fiscal Year
(March 31, 2019)

Current Fiscal Year
(March 31, 2020)

Liabilities
Current liabilities
Notes and accounts payable-trade
Short-term borrowings

197,7421,500,000

195,720-

Current portion of long-term loans payable
Accounts payable – other

2,166,092
1,570,333

1,639,460
1,535,400

Income taxes payable
Accrued consumption taxes

435,953
81,136415,324
117,626

Reserve for bonuses
Asset retirement obligation

411,135
13,500554,836
10,894

Other

1,504,249

1,451,683

Total current liabilities

7,880,143

5,920,945

10,454,371

9,479,911

642,495
317,269

757,052
320,567

Fixed liabilities
Long-term debt
Obligations for retirement plan
Asset retirement obligation
Other

10,324

7,979

11,424,460

10,565,510

19,304,604

16,486,455

CapitalCapital surplus

1,603,955
1,449,544

1,603,955
1,449,544

Retained earnings
Treasury stock

6,184,830-81,685

6,982,526-107,515

Total shareholders’ equity

9,156,643

9,928,510-133,411-224,438-7,165238-5,537
2,610

Accumulated adjustment for retirement benefits-65,813-64,895

Total other accumulated comprehensive income
Total net assets-206,151
8,950,492-292,261
9,636,249

28,255,096

26,122,705

Total long-term liabilities
Total liabilities
Net assets
Shareholders’ equity

Accumulated other comprehensive income
Valuation difference on available-for- salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment

Total liabilities and net assets

9(2) [Consolidated Statement of Income and Consolidated Statement of Comprehensive Income][Consolidated Statement of Income]Net sales
Cost of sales

Previous Fiscal Year
(Apr. 1, 2018
- March 31, 2019)29,298,670
25,119,787(Thousand yen)
Current Fiscal Year
(Apr. 1, 2019
- March 31, 2020)
31,719,442
27,298,724

Gross profit

4,178,883

4,420,718

Selling, general and administrative expenses

2,647,588

2,881,943

Operating income

1,531,294

1,538,774

105,359

98,65965,608349,3255,467
450,421

Non-operating income
Interest income
Guarantee commission received
Subsidy income
Other

39,77813,030Total non-operating income

560,072

567,579

Interest expenses
Commission fee

56,52455,25255,5184,000

Handicapped employment levy
Demobilization costs

8,150
34,886

10,635
1,289

Allowance for doubtful accounts
Other

15,79325,344
5,878

Non-operating expenses

Total non-operating expenses

170,606

102,665

1,920,760

2,003,687

Loss on sales of noncurrent assets
Loss on retirement of fixed assets

77
2,240

1,382

Impairment loss (on facilities)
Impairment loss

83,782
24,590229,257
81,960-2,642

Ordinary income
Extraordinary loss

Loss on sales of investment securities
Total extraordinary loss
Income before income taxes and minority interests
Corporate, inhabitant and enterprise taxes
Income taxes-deferred
Total income tax
Net income
Net loss attributable to non-controlling interests
Net income attributable to owners of parent

10

110,690

315,241

1,810,070

1,688,446

760,950-22,086

829,819-264,106738,864

565,713

1,071,206

1,122,732-64-

1,071,270

1,122,732

[Consolidated Statement of Comprehensive Income]Previous Fiscal Year
(Apr. 1, 2018
- March 31, 2019)
1,071,206(Thousand yen)
Current Fiscal Year
(Apr. 1, 2019
- March 31, 2020)
1,122,732

Valuation difference on available-for- sale securities
Deferred gains or losses on hedges-86,757-7,710-91,026
1,627

Foreign currency translation adjustment
Accumulated adjustment for retirement benefits-3,660-22,4622,371
917

Total other comprehensive income-120,590-86,110

950,615

1,036,622

950,679

1,036,622-64-

Net income
Total accumulated other comprehensive income

Comprehensive income
BreakdownComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests

11

[Consolidated Statements of Changes in Shareholders’ Equity]
Previous Fiscal Year (April 1, 2018 – March 31, 2019)(Thousand yen)
Shareholders’ equity
CapitalBalance at the beginningof current period
Changes of items during
the period

Capital surplus

1,603,955

1,449,544

Dividends from surplus
Net income attributableto owners of parent
Purchase of treasury
stock
Disposal of treasurystock
Net changes of items
other than shareholders'equityTotal changes of items
during the period
Balance at the end ofcurrent period

Retainedearnings
5,421,026

Treasury stock

Total
shareholders’equity-636,635

7,837,890-307,466-307,466

1,071,270

1,071,270-0-0554,950

554,950--

763,803554,949

1,318,753

1,603,955

1,449,544

6,184,830-81,685

9,156,643

Accumulated other comprehensive income
Accumulated
Valuation
Deferred gains or Foreign currency adjustment fordifference onlosses ontranslation
available-forretirement
hedgesadjustment
sale securities
benefits
Balance at the beginningof current period
Changes of items during
the period-46,654

545

3,899

-43,350

Total otheraccumulatedcomprehensive
income-85,560

Non-controlling
Total net assetsinterests

3,869

Dividends from surplus
Net income attributableto owners of parent
Purchase of treasury
stock
Disposal of treasurystock
Net changes of items
other than shareholders'equityTotal changes of items
during the period
Balance at the end ofcurrent period

7,756,199-307,466
1,071,270-0554,950-86,757-7,710-3,660-22,462-120,590-3,869-124,460-86,757-7,710-3,660-22,462-120,590-3,8691,194,293-133,411-7,165238-65,813-206,151-

8,950,492

12

Current Fiscal Year (April 1, 2019 – March 31, 2020)(Thousand yen)
Shareholders’ equity
CapitalBalance at the beginningof current period
Changes of items during
the period

Capital surplus

1,603,955

1,449,544

Dividends from surplus
Net income attributableto owners of parent
Purchase of treasury
stock
Disposal of treasurystock
Net changes of items
other than shareholders'equityTotal changes of items
during the period
Balance at the end ofcurrent period

Retainedearnings
6,184,830

Treasury stock

Total
shareholders’equity-81,685

9,156,643-325,036-325,036

1,122,732

1,122,732-107,257-107,257

81,42781,427--

797,696-25,829

771,866

1,603,955

1,449,544

6,982,526-107,515

9,928,510

Accumulated other comprehensive income
Accumulated
Valuation
Deferred gains or Foreign currency adjustment fordifference onlosses ontranslation
available-forretirement
hedgesadjustment
sale securities
benefits
Balance at the beginningof current period
Changes of items during
the period-133,411-7,165238-65,813

Total otheraccumulatedcomprehensive
income-206,151

Non-controlling
Total net assetsinterests-

Dividends from surplus
Net income attributableto owners of parent
Purchase of treasury
stock
Disposal of treasurystock
Net changes of items
other than shareholders'equityTotal changes of items
during the period
Balance at the end ofcurrent period

8,950,492-325,036
1,122,732-107,257
81,427-91,026

1,627

2,371

917

-86,110--86,110-91,026

1,627

2,371

917

-86,110-685,756-224,438-5,5372,610-64,895-292,261-

9,636,249

13

(4) [Consolidated Statement of Cash Flows](Thousand yen)
Current Fiscal Year
(Apr. 1, 2019
- March 31, 2020)

Previous Fiscal Year
(Apr. 1, 2018
- March 31, 2019)
Net cash provided by (used in) operating activities
Income before income taxes and minority interests

1,810,070

1,688,446

Depreciation and amortization
Amortization of goodwill

703,991
30,385724,183
30,385

Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in liabilities relating to retirement
benefits
Loss (gain) on sale of investment securities-6,31721,07924,728
143,701

81,148

115,954-

2,642-105,359
56,524-98,659
55,518

2,240
77

1,382
-

108,372

311,217

9,592-4,63820,088-297,160

17,640-37,365-1,747-1,715-31,174-10,515-14,756

17,962

2,762-1,63343,046-13,792

Decrease (increase) in other current assets
Decrease (increase) in other fixed assets

80,464-16,186

38,382
152,568

Increase (decrease) in other current liabilities
Increase (decrease) in other fixed liabilities

10,881
28,246-72,6543,297

2,491,590

181
3,131,899

17,123-54,894

9,249-59,856

Interest and dividends income
Interest expenses
Loss (gain) on retirement of fixed assets
Loss (gain) on sales of fixed assets
Impairment loss
Decrease (increase) in notes and accounts receivabletrade
Decrease (increase) in inventories
Decrease (increase) in accounts receivable - other
Decrease (increase) in accrued consumption taxes
Decrease (increase) in notes and accounts payabletrade
Decrease (increase) in accounts payable - other andaccrued expenses
Increase (decrease) in accrued consumption taxes
Increase (decrease) in advances received

Other
SubtotalInterest and dividends income received
Interest expenses paid
Income taxes (paid) refund-624,316-760,420

Net cash provided by (used in) operating activities

1,829,502

2,320,872

14

Previous Fiscal Year
(Apr. 1, 2018
- March 31, 2019)
Net cash provided by (used in) investing activities
Purchase of property, plant and equipment(Thousand yen)
Current Fiscal Year
(Apr. 1, 2019
- March 31, 2020)-1,877,501-865,830-3,959231-33,713-

Proceeds from subsidy income
Proceeds from sales of investment securities

1,059,222-

1,208,435
17,578

Payments for guarantee deposits
Proceeds from collection of guarantee deposits-71,870
14,188-51,637
25,677

Payments of long-term loans receivableCollection of long-term loans receivable
Purchase of liquidation of subsidialies resulting inchange in scope of consolidation
Other-360,540
272,223-120,000
263,820-3,804-31,711-25,347

Net cash provided by (used in) investing activities-940,099

418,982

Purchase of intangible assets
Proceeds from sales of property, plant and equipment

Net cash provided by (used in) financing activities
Proceeds from short-term loans payable

5,500,000

100,000

Repayments of short-term loans payable
Proceeds from long-term loans payable-5,500,000
4,000,000-1,600,000
700,000

Repayments of long-term loans payable
Proceeds from disposal of treasury shares-2,799,068
579,791-2,201,092
81,427-0-305,348-107,438-322,338

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

1,475,374-3,349,442-4,088-365

2,360,688-609,951

Cash and cash equivalents at beginning of period

4,450,750

6,816,439

Cash and cash equivalents at end of period

6,816,439

6,206,487

Purchase of treasury shares
Cash dividends paid

15

Notes on the consolidated financial statements(Notes on going concern assumption)
Not applicable(Additional information)[Trading regarding the stock distribution trust (employee stock ownership disposal type)]
Current consolidated fiscal year (April 1, 2019 – March 31, 2020)
At our company, we had introduced “stock distribution trust (employee stock ownership disposal type)” (hereinafter referred toas “this system”) to improve the welfare of our employees as well as to provide the incentive for the added corporate value, but
this system was ended on April 10, 2019.
(1) Summary of tradingThis system is an incentive plan to return the stock appreciation merits of our company to all employees who are members of
the “JP Employees Stock Ownership” (hereinafter referred to as “the stock ownership”).
In this system, our company was bound by the stock distribution trust contract (employee stock ownership disposal type)(hereinafter referred to as “this trust contract”) with our company as the trustor and Mizuho Trust & Banking Co., Ltd. as thetrustee. The trust set up in accordance with this trust contract is referred to as “this trust.” Additionally, Mizuho Trust &Banking Co., Ltd. was bound by the re-trust contract with Trust & Custody Services Bank, Ltd. (hereinafter referred to as“Trust E Bank”) with the said bank as the re-trustee to re-trust the management of the trust assets such as securities, but thecontract was ended on April 10, 2019.
(2) Own stocks remaining in the trust
Our company appropriates the own shares remaining in the trust as the treasury shares as part of the net assets through thebook value of the trust (except for the incidental expenses). The book value and the number of stocks of the treasury sharesare 81,427 thousand yen and 296,100 shares at the end of the previous consolidated fiscal year, and no values in the end of
the current consolidated fiscal year.
(3) Book value of debts appropriated by the gross price method
End of the previous consolidated fiscal year: 351,652 thousand yen
End of the current consolidated fiscal year: - thousand yen(Segment Information)
As our group operates within one single segment (nursery service), we have omitted the descriptions as such.

16

(Per-stock Information)
Previous Fiscal Year
(Apr. 1, 2018
- March 31, 2019)

Current Fiscal Year
(Apr. 1, 2019
- March 31, 2020)

Net assets per share

102.23 yen

110.17 yen

Net income per share

12.44 yen

12.81 yen

(Note) 1. Diluted net income per share is omitted as there are no dilutive shares.
2. The own stocks remaining in the trust as appropriated as the treasury stock in the capital stock are, according to thecalculation of net income per share, included as the treasury shares that are deducted from the mid-term average numberof stocks, and according to the calculation of net assets per share, are included in the number of treasury shares that are
deducted from the total number of stocks issued at the end of term.
The average number of treasury stock deducted for the calculation of net income per share was 1,749,823 shares for theprevious fiscal year and 22,777 shares for the current fiscal year, and the number of treasury stock deducted for the
calculation of net assets per share was 296,100 shares for the previous fiscal year and no shares for the current fiscal year.
3. The basis for calculating net income per share is as follows:
Previous Fiscal Year
(Apr. 1, 2018)- March 31, 2019)
Net income attributable to ownersof parent (thousand yen)

Current Fiscal Year
(Apr. 1, 2019
- March 31, 2020)

1,071,270

1,122,732

Amount not attributable to commonshareholders (thousand yen)--

Net income attributable to ownersof parent related to common shares(thousand yen)

1,071,270

Average number of shares ofcommon shares during the period(shares)

86,097,870(Significant events after the reporting period)
Not applicable17

1,122,732

87,649,993