Prime Market（2749）

https://www.jp-holdings.co.jp/

Financial Results for the Fiscal Year
ended March 2022/
Medium-Term Management Plan

May 20, 2022
JP-HOLDINGS, INC.

ＩＮＤＥＸ
１

Outline of JP Holdings, and its Efforts toAttain SDGs

2

FY3/22 Results

3

Reviewing and Updating of the New
Medium-term Management Plan

４

FY3/23 Forecast

5

APPENDIX© 2022 JP-HOLDINGS, INC.

2

1

Outline of JP Holdings, and its
Efforts to Attain SDGs

3

Every activity is for children’s smiles

Leading company in the child-raising support business
JP Holdings Group is a leading company in the child-raising support business, and operates
childcare support facilities, including nursery schools, school clubs, and children’s houses.
JP Holdings Group was founded in 1993, and started childcare business by establishing a day-care center for childrenof our employees so that they can work without worry. As joint-stock corporations were allowed to do nursery businessin 2000, we first spread safe, reliable childcare services nationwide, while being supported by various people.
Group companies include Japan Nursery Service Inc., J Kitchen Inc., which cooks meals for nursery schools, J Cast Inc., which offers
classes in English, gymnastics, and eurhythmics for childcare support facilities and supports development for childcare, J Planning Sale
Inc., which plans and sells childcare-related goods, and Japan Nursery Institute for General Research Inc., which conducts training andresearch about childcare and support for development and support business by visiting nursery schools, and operates the childcare
platform “codomel.” These subsidiaries are managed and supervised by JP Holdings, Inc.

4

Outline of the Business of JP-Holdings
We operate the childcare support
business in an integrated manner.

Operation of nursery schools, school clubs,
and children’s houses
Operating 307 facilities around Japan

JP-Holdings
Business administration/development(new and existing businesses)
Japan Nursery Service
Operation of nurseryschools, school clubs,
and children’s houses

Group purchase
Sale of childcare goods
Development of groupfacilities

JP-Holdings

J Planning Sale
Sale of childcare
goods

Development and operation of earlychildhood learning programs
English, exercise, eurhythmics, danceSupport for development

Childcare support business taking fulladvantage of synergy among groupcompanies

J CastDevelopmentof programsfor children

J Kitchen
Cooking oflunches andadvisory

Japan Nursery Institutefor General ResearchTraining
andresearch

Cooking of lunches(Our company andother companies)
Advisory

Training business
BPO service
Support business by visiting
nursery schools
Platform business
Overseas business© 2022 JP-HOLDINGS, INC.

5

Social Issues to be Solved with Our BusinessSocial issues to be solved with our businessChildcare
support

Educational
supportRelated SDGs

Improve the quality ofchildcare support
Reduce the number ofchildren on waiting lists

Promotion of high-quality childcare support
Establishment of new facilities for
decreasing the number of children on waitinglistsDevelopment and provision of online
childcare while grasping changes in thesocial environmentSafe, reliable facilities and operation
Provision of nutritious lunch for maintaining
healthEnrichment of support for child development

Offer high-quality earlychildhood learning

Development and enrichment of educational
programs (English, exercise, eurhythmics
and dancing)Development and promotion of online
education
Development of programs for early childhood
learning at home in response to changes inthe social environment
Provision of early childhood learning
opportunities

×
Partnership

Major activities

To help solve social issues based on the partnership withstakeholders© 2022 JP-HOLDINGS, INC.

6

Social Issues to be Solved with Our Corporate Activities
Social issues to be solved withour corporate activities

Personnel
development

Related SDGs

Improvement in expertise andactualization of independent
career development

Major activities
Promotion of work style reformEnrichment of training structure
Career paths and job rotation

Empowermentof women

Actualization of diversityminded workplaces

Workstyles tailored to lifestyles
Systems for childbirth, childcare, andnursing care
Development of a proper businessenvironment

Human rights
and D&I*1

Actualization of diverse
workstyles

Utilization of diverse human resources andsound business administration
Development and production of female
leaders

Socialcontribution to
local
communities

Creation of a childcare
environment

Promotion of childcare support in local
areasPromotion of employment
Promotion of prevention of abuse

Earthenvironment

Contribution to a sustainable
earth environment

Partnership

To help solve social issues based on the partnership withstakeholders

×Creation of environmentally sound facilities
Reduction of CO2 emissions by installing
LED lighting
Reduction of food loss and waste*1: Diversity & inclusion (To create something new by utilizing different experiences and accepting differences)© 2022 JP-HOLDINGS, INC.

7

Initiatives to Solve Social Issues
⦿As a mission of an enterprise that operates childcare support business, wewill approach impoverished households and take measures for preventing
child abuse, which are social problems.
We will discuss various measures for raising and donating funds, and determine and actively
promote “activities” and “initiatives” for the future of children.
(In December 2020 and May 2021, we conducted the “support for single-parent households.”)
No poverty

Prevention of child abuse© 2022 JP-HOLDINGS, INC.

8

Initiatives for Solving Social Issues
⦿ To reduce environmental burdens and disposal costs, by thoroughly reusing andrecycling necessary products for childcare
⦿ To support “childcare around the world” by offering inexpensive, high-quality,
reused childcare goods, which are available only in Japan, to countries and regionsin needChild-rearing assistanceplatform© 2022 JP-HOLDINGS, INC.

9

Renewal of our Management Philosophy and Corporate Message●To renew our management philosophy and operational philosophy, and produce a new corporate message●Under the new philosophies, we will improve our child-raising support business based on the cooperation
with local communities.

JP HoldingsGroup’s System
Management philosophy

Corporate message

Operational philosophy
Childcare philosophy andchild-raising philosophy

To contribute to the development of a society filled withsmiles through childcare support
Every activity is for children’s smiles
To conduct childcare and child-rearing while giving top priority
to safety and reliability
To put importance on daily childcare, so that our facilities will be
remembered foreverTo bring a smile to each child, while our staff can enjoy their jobs
To contribute to society by operating facilities that are connected
to and support local communities
To always offer child-raising support demanded by the times

Childcarephilosophy
To nurture the skills to survive tomorrow

Child-rearing
philosophy
To develop the ability to become an ideal self
© 2022 JP-HOLDINGS, INC.

10

2

FY3/22 Results11

FY3/22 Consolidated Results (Summary)Thanks to the increase in the number of children accepted, curtailment of costs, etc.,
sales and profit grew, achieving a record-high profit.
Net sales: Grew thanks to the increase in the number of children accepted through the establishment of new facilities and mainly online
programs.
Operating and ordinary incomes: Grew thanks to the sales growth and curtailment of costs, despite the rise in the provision for bonuses
due to the change in the bonus payment period in the wake of the adoption of a new HR system and the augmentation of expenses due tothe installation of systems.
Net income: Rose because ordinary income increased considerably through the establishment of an efficient operation system and we
posted an extraordinary income in FY 3/2022, as impairment loss decreased significantly through the improvement of profitability of eachfacility and we sold fixed assets of 3 out of 10 nursery schools owning land and buildings, although there was a significant extraordinary loss
in the previous term.
Unit: million yen

FY3/21

FY3/22

Change Comparedto the Previous
Term

Rate of Change
Compared to thePrevious Term

Rate of Change
Compared to the
Forecast

Forecast

34,373
3,344

872

2.6%

1.4%

Operating income

33,500
2,857

487

17.1%

22.5%

33,9002,730

Operating income
margin

8.5%

9.7%

1.2%

-

1.6%

8.1%

Ordinary income

3,358
9.8%
2,279

410

13.9%

21.7%

1.0%

-

1.6%

Net income attributable toowners of parent

2,947
8.8%
537

1,742

324.1%

29.5%

2,760
8.1%
1,760

Net income per share
(yen)

6.15

26.06

19.9

323.7%

-

-

ROE

5.5%

20.7%

15.2%

276.4%--Net sales

Ordinary income margin*1 : Net income represents “Net income attributable to owners of parent.”*2: We changed the presentation methods, to include subsidy income for childcare business, which had been posted in non-operating income, in “Net sales” from thefirst quarter of the current fiscal year.

© 2022 JP-HOLDINGS, INC.

12

FY3/22 Factors for Changes in Net Sales
Net sales

Sales grew, as new facilities were opened and the number of children accepted increased
during the term thanks to the efforts to “develop nursery schools and facilities that would beselected by customers,” including the digital tours of facilities, online programs regarding
English, exercise, eurhythmics, dance, etc. amid the coronavirus pandemic, and the adoptionof new programs for early childhood learning.

1,194

33,500

Increaseof productsales, etc.

-256
-80

Net
sales

Results for FY
3/21

Decreasedue to theclosure offacilities

Decrease ofoutsourcing
transactions,etc.

34,373

15

Establishmentof new
facilities, andincrease in thenumber ofchildren
accepted

Net
sales

Results for FY
3/22(Unit: million yen/ Rounded down to the nearest million yen.)© 2022 JP-HOLDINGS, INC.

13

FY3/22 Factors for Changes in Operating Income
OperatingincomeOperating income grew, hitting a record high, because sales grew thanks to the opening of new
facilities, etc. and we curtailed expenses by pursuing efficient management through thereshuffling of personnel at each facility and the improvement of recruitment activities, althoughexpenditure augmented by 400 million yen due to special factors, such as the rise in theprovision for bonuses due to the change in the bonus payment period in the wake of the
adoption of a new HR system and the augmentation of costs for installing systems.

507

2,857

OperatingincomeResults for FY
3/21

Gross profit
Increase due to the sales
growth through the
opening of new facilities
and the increase in thenumber of children
accepted, andcurtailment of costs
following reshuffling of
personnel and reductionof recruitment expenses

20
SG&A
Increase of theprovision for bonuses
due to the adoption ofa new HR system andincrease of personnel
in the headquarters

3,344

OperatingincomeResults for FY
3/22(Unit: million yen/ Rounded down to the nearest million yen.)© 2022 JP-HOLDINGS, INC.

14

FY3/22 Factors for Changes in Ordinary Income
Ordinary
income2,947

Ordinary
incomeResults for FY 3/21

Ordinary income grew considerably, hitting a record high, thanks toefficient operation, curtailment of expenses, and the sales growth throughthe opening of new facilities and the increase in the number of children
accepted, which were achieved by measures, mainly online programs.
487

-71

OperatingincomeDrop in nonoperating income

Growth ofoperating income
thanks to thecurtailment ofcosts as well as thesales growththrough the
opening of new
facilities and somemeasures1

3,358

Drop in nonoperating expenses

Ordinary
incomeResults for FY 3/22
(Unit: million yen/ Rounded down to the nearest million yen.)© 2022 JP-HOLDINGS, INC.

15

FY3/22 Factors for Changes in Net Income
Net income
attributable toowners ofparent

Net income increased as ordinary income grew considerably through the establishmentof an efficient operation system, impairment loss declined significantly in the current
term through the improvement of profitability at each facility despite the posting of asignificant extraordinary loss in the previous term, and we posted an extraordinary
income, because we sold fixed assets for 3 out of 10 nursery schools owning land andbuildings.

-2,045

Rise inextraordinary
income

経常利益
410

537
Rise in ordinary
incomeNet income
attributable toowners ofparentResults for FY 3/21

149

Decrease in
extraordinary
loss

863

2,279
Augmentationof incometaxes

Net income
attributable toowners ofparentResults for FY 3/22
(Unit: million yen/ Rounded down to the nearest million yen.)© 2022 JP-HOLDINGS, INC.

16

FY3/22 Consolidated Results (Financial Position)
Increase of funds for coping with the uncertain situation amid the coronavirus pandemic
Financial condition

Liabilities, Net Assets, Shareholders Equity Ratio

End of March 2022 *( ) = Difference with the end of March 2021

Liabilities

Net assets－－Equity Ratio (%)

Liabilities

Assets

22,299 million yen

34,274 million yen(+2,566 million yen)(+4,534 million yen)

Net assets
11,975 million yen(+1,967 million yen)

End of Mar. 2021

End of Mar. 2022

Current assets

15,13920,931

Fixed assets

14,601

13,343

Total assets

29,74034,274Current
liabilities

7,829

7,891

Fixed liabilities

11,903

14,407

Total liabilities

19,732

22,299Total net assets

10,007

11,975

Million yen

22,299 million yen

19,732 million yen

34.9

33.7
10,007 million yen

11,975 million yen

End of Mar. 2021

End of Mar. 2022

Cash and deposits
Inventory assets
Accounts receivable-otherConstruction in progress

17,296 million yen
63 million yen
2,708 million yen
137 million yen

Current portion of long-term loans-payable 3,113 million yen
Accounts payable
1,561 million yen
Income taxes payable
641 million yen
Long-term loans payable
12,816 million yen

Retained earnings
Accumulated other comprehensive income

9,117 million yen-87 million yen(Figures are rounded down to the nearest million yen, and the equity ratio is rounded off to the nearest first decimal point place.)© 2022 JP-HOLDINGS, INC.

17

FY3/22 Consolidated Results (Balance Sheet)
End of Mar. 2021
(million yen)

Total current assets

End of Mar. 2022
(million yen)

Change(million yen)

15,13920,931

5,791(Cash and deposits)

11,02017,296

6,275(Accounts receivable-other)

3,009

2,708

-300

14,601

13,343-1,257(Total tangible fixed assets)

6,701

5,734

-966

(Total intangible fixed assets)

214

174

-39

7,685

7,434

-251

Total assets

29,74034,274

4,534

Total current liabilities

7,829

7,891

62

(Current portion of long-term loanspayable)

3,307

3,113

-194

(Accounts payable)

1,634

1,561

-72

11,903

14,4072,504

10,305

12,8162,510

Total liabilities

19,732

22,2992,566

Total net assets

10,007

11,975

1,967

Total liabilities and net assets

29,74034,274

4,534

Total fixed assets(Total investments and other assets)

Total fixed liabilities(Long-term loans-payable)(Rounded down to the nearest million yen)
© 2022 JP-HOLDINGS, INC.

18

FY3/22 Consolidated Results (Cash Flows)
Operating CF: Increase in pretax profit and decrease in impairment loss
Investing CF: Sale of tangible fixed assets and investment securities, and acquisition of fixed
assets for opening new facilities
Financing CF: We increased long-term loans while considering the impact of COVID-19.
(Million yen)

FY 3/21FY 3/22

ChangeCash flows from operating
activities

2,469

3,884

1,415

Cash flows from investing
activities

190

413

222

Free cash flow

2,659

4,297

1,638

Cash flows from financing
activities

2,155

1,978

-176

Cash and cash
equivalents at end of
period11,02017,296

6,275(Rounded down to the nearest million yen)
© 2022 JP-HOLDINGS, INC.

19

FY3/22 Forecast

20

Upward Revision of the Previous Earnings Forecasts●Our company adopted digital technologies
actively compared with competitors.
▷Online facility tours, online learning
programs such as English, gymnastics,
eurhythmics and dance, online international
exchange programs and enrichment of earlychildhood learning program●To actively develop nursery schools andfacilities that would be selected bycustomers, to increase the children accepted
not only for the current fiscal year, but also
for the next fiscal year

Dance program●Net sales: Up 0.6%
Previous forecasts: 33,700 million yen➡33,900 million yen●Operating income: Up 18.7%
Previous forecasts: 2,300 million yen➡2,730 million yen●Ordinary income: Up 20.0%
Previous forecasts: 2,300 million yen➡2,760 million yen●Net income attributable to owners of parent: Up 21.4%
Previous forecasts: 1,450 million yen➡1,760 million yen

International exchange program

Education on agriculture© 2022 JP-HOLDINGS, INC.

21

FY3/22 Forecast (Difference)
Our company actively promoted digitization compared with competitors, the enrollment of
more pupils, and the “development of nursery schools and facilities that would be selected bycustomers.” As a result, our business performance exceeded the forecast considerably.
Revised full-year
forecast for FY
3/22

Initial full-year
forecast for FY
3/22

Results for FY
3/21

Results for FY
3/22

Difference fromthe revised fullyear forecast

Ratio ofdifference fromthe revised fullyear forecast

Net sales (million yen)

33,50033,70033,90034,373473

1.4%

Operating income (million yen)

2,857

2,300

2,730

3,344

614

22.5%

Ordinary income (million yen)

2,947

2,300

2,760

3,358

598

21.6%

Net income attributable to owners ofparent (million yen)

537

1,450

1,760

2,279

519

29.5%

Net income per share (yen)

6.15

16.58

20.12

26.06

5.93

29.5%

Dividend per share (yen)

3.90

4.50

4.50

4.50

0%

0%

Dividend payout ratio (%)

63.4

27.1

22.4

17.3

-5.1%

-22.8%

4

3

0

0%

0

0%

Expected opening of nursery school(school)33

Switch to
Switch to
Switch to licensed Switch to licensed
licensedlicensed
nursery school:nursery school: 1 nursery school: 2
nursery school: 2

2

Expected consignment of school clubs
and children’s houses (facility)

5

8

8

8

(Unit: million yen/ Rounded down to the nearest million yen.)© 2022 JP-HOLDINGS, INC.

22

Dividend Forecast For FY3/22
⦿Dividend policy
The Company pays a performance-based dividend with a consolidated payout ratio of around 30%
while securing the internal reserves necessary to develop business in the future and strengthen ourmanagement structure.
We keep dividend per share at the amount decided at the beginning of the fiscal year of 4.50 yen
after comprehensively taking into account the unstable economic environment including thelingering spread of COVID-19, rapid acceleration of declining birthrate, and the rise in commodity
prices accompanying soaring resource prices due to geopolitical risks.

3.50 yen

3.70 yen

Payout ratio
32.7%

Payout ratio
29.7%

FY 3/18

FY 3/19

4.50 yen

3.90 yen

3.90 yen

Payout ratio
30.4%

Payout ratio
63.4%

Payout ratio
27.1%

FY 3/21FY 3/22(Planned)

FY 3/20*The year-end dividend for FY3/22 will be the dividend per share if approval is obtained at the Company’s 30th Ordinary General Meeting of Shareholders.
© 2022 JP-HOLDINGS, INC.

23

New Openings For FY3/22
FY3/21 New Openings
Nursery Schools: 3
School Clubs: 8
Total: 11
On April 1, 2021, we transformed “Ask Ontake Nursery School,” which
has been in operation since August 1, 2003, and “Asc Shimomaruko
Nursery School,” which has been in operation since April 1, 2010, from
Tokyo licensed nursery school to licensed nursery schools.
As “Wakuwaku Takinogawa Momiji Hiroba/Takinogawa Momiji Genkikko
Club No. 1” was established, “Wakuwaku Takinogawa Momiji Hiroba” wasrenamed “Wakuwaku Takinogawa Momiji Hiroba/Takinogawa Momiji
Genkikko Club No. 1.” on April 1, 2021, and has been in operation sincethen.
At the end of March 2021, we closed “Asc Iidabashi Nursery School,”“Asc Nishishinjuku Nursery School,” “Asc Ikebukuro Nursery School,” and“Asc Yukigaya-Otsuka Nursery School,” which are Tokyo licensed
nursery schools, and “AEL Yokohama Business Park,” which is a private
school club. In addition, we withdrew from the operation of “Nakano-ku
Kids Plaza Yato,” “Kita-ku Sakura Club No. 1” and “Kita-ku Sakura ClubNo. 2,” which are school clubs, and “Sayama City Chuo Children's
House,” which is a children’s house, on March 31, 2021, due to the
expiration of respective contract periods.

No. of Facilities Operated as of
the End of September 2021
Nursery Schools: 211
School Clubs: 81
Children’s houses: 11
Total: 303

Tokyo:
3 licensed nursery schools
Asc Kami-Shakujii Nursery SchoolAsc Kanamachi Nursery SchoolAsc Higashikasai Nursery School No. 2

Tokyo:
8 school clubs and children’s houses
Wakuwaku Takinogawa Momiji Hiroba/Takinogawa Momiji Genkikko Club No. 2
Wakuwaku Takinogawa Momiji Hiroba/Takinogawa Momiji Genkikko Club No. 3
Mitaka City Rokusho School Club A
Niji-iro Kids Club
Bancho Elementary School After School No. 1
Bancho Elementary School After School No. 2
Bancho Elementary School After School Kids’Club (Play school)Jindaiji Children’s House© 2022 JP-HOLDINGS, INC.

24

No. of Facilities Operated as of the End of March 2022
No. of Facilities Operated by Region

Operate 303 facilities as of the End of March 2022

TohokuHokkaido

Licensed nurseryschools: 11

Kanto

Kinki

Licensed nurseryschools: 9
KyushuOkinawa

Licensed nurseryschools: 5
Company-led
nursery school: 1

Licensed nurseryschools: 3

Chubu

Licensed nurseryschools: 9
School clubs: 3
Children’s houses: 6

Licensed nursery schools: 156
Non-licensed nursery schools: 13
Other non-licensed nursery schools: 4
School clubs: 78Children’s houses: 5211 nursery schools, 81 school clubs, 11 children’s houses© 2022 JP-HOLDINGS, INC.

25

3

Reviewing and Updating of the New
Medium-term Management Plan

26

Review of the Medium-term Management
Plan (FY 3/22)

27

Progress of the Medium-term Management Plan Disclosed in FY 3/22
We completed the medium-term management plan about 2 years earlier than initially scheduled.
New measures

・To improve profitability at each facility by streamlining operation through the reshuffling of personnel, improving recruitment activities, etc.
and curtail expenses by upgrading the system for placing orders for goods, to increase profit

Cost reduction
Revenue
improvement

・To increase revenues, by “developing nursery schools and facilities that would be selected by customers” through various measures,such as the online tours of nursery schools, online programs on English, exercise, eurhythmics, and dance, the adoption of new
programs for early childhood learning, and online international exchange programs.

Initial Plan

Unit: million yen

FY3/22

FY3/23

FY3/24

Plan

Plan

Plan

Net sales

33,900Operating income
Operating income margin

Ordinary income

Results

33,70034,700FY3/22
ResultsVs. Initial Plan

34,373

1.4%

2,300

3,344

45.4%

6.8%

9.7%

2.9%

2,300

2,970

3,500

3,358

46.0%

Ordinary income margin

6.8%

8.8%

10.1%

9.8%

3.0%

Net income attributable to ownersof parent

1,450

2,279

57.2%

Net income margin

4.3%

6.6%

2.4%

*1: We changed the presentation methods, to include subsidy income for childcare business, which had been posted in non-operating income, in “Net sales” from the firstquarter of the current fiscal year.
*2: Net income represents “Net income attributable to owners of parent.”© 2022 JP-HOLDINGS, INC.

28

Performance Indicators in the Medium-term Management Plan
Sales have been steady, while profitability increased due to the personnel
reshuffling and the acquisition of new subsidies.
Net sales grew 127.6% between FY 3/18 and FY 3/22.
Ordinary income rose 212.3% between FY 3/18 and FY 3/22.
(Unit: million yen)
(Net sales)(Profit)

FY3/18Net sales

FY3/19Operating income

FY3/20Ordinary income

FY3/21

FY3/22

Net income attributable to owners of parent© 2022 JP-HOLDINGS, INC.

29

Review of the First Fiscal Year (FY 3/22) of the Medium-term Management Plan
Revenues, business restructuring, streamlining of operations, and growthstrategy progressed as planned.
ItemManagement goal

Business goals for FY 3/24

Priority challenges

Management policy
Challenges

Challenges

Development of the
management foundation

Overview

Evaluation

Establishment of the management foundation and implementation of growth strategies
Aiming to develop “nursery schools and facilities that would be selected” by guardians,
municipalities, training schools, and employees〇

Strengthening of the management foundation and improvement in revenues
Aiming to achieve an ordinary income margin of 10.0% or higher (in 3 years)〇

Improvement in revenues from existing facilities, enrichment of early childhood learning,
creation of new businesses, and enhancement and continuous promotion of measuresagainst infectious diseases〇

Selection andconcentration

Vitalization of organizations

Profitability and efficiency

Growth potential(Early childhood learning and new
development)

Brand development〇
Soundness●Strengthening of the business portfolio (new and existing businesses) ●Education of
personnel and the entrenchment of a new HR system ●Systemization (sophistication ofbusiness administration and streamlining of business operations) ●Tightening of thegovernance system ●Strengthening of development functions ●Improvement of revenues(existing business, review of operations, cooperation between organizations)△(Systemization)(Cooperation
betweenorganizations)① Segregation and systematization of head-office and on-site tasks and inter-organization cooperation for streamlining business
operations further② Regional alliances, new measures, and further dissemination of information for developing “nursery schools and facilities that would
be selected”③ Sustainable business expansion and launch of growth strategies© 2022 JP-HOLDINGS, INC.

30

Review of the Medium-termManagement Plan (FY 3/22 to FY 3/24) via
a Rolling Method

31

Business Environment Surrounding our Company◆Changes in the business environment⦿ Rapid spread of the omicron
variant (spread of health damage)⦿ Worsening of internal and external
economies
Rise in prices of commodities(skyrocketing of prices of resources)

Predicted changes in theenvironment
⦿ Intensification of the competition for
acquiring children
⦿ Closure of more nursery schools
⦿ Acceleration of restructuring ofchildcare enterprises (forming alliancesin response to oligopolization)

⦿ Significant and sharp drop in the numberof births
⦿ Increase of the budget for childcare
support (Japan)◆ Management issues
⦿ Maintenance of health and motivation amid
the coronavirus pandemic
⦿ Improvement of mindsets of onsite workers
⦿ Streamlining of business operations ➡
Compact head office⦿ Outsourcing of operation of more
public nursery schools to private
enterprises

⦿ Change of social welfare
corporations due to the amended
Social Welfare Act (enhancement ofcompetitiveness)
⦿ Establishment of Agency for Children
and new subsidies

Develop nursery schools and facilities
that would be selected by customers

Current situation

⦿ Establishment of growth strategies© 2022 JP-HOLDINGS, INC.

Improvement in corporate value/Sustainable growthAs our business environment is changing, we need to take measures for evolving our existing
businesses and achieving further growth.

32

Business Environment Surrounding our Company (Supplementary)
Concern over the augmentation of costs due to the rise in prices of commodities
Lingering rampancy of the omicron variant●Demand and crowd control for preventing the spread of infection●Restriction on supply, disturbance in logistics, and shortage of manpower due tothe spread of infection●The infection situation is uncertain, so the supply-demand balance is teetering.

Rise in prices of commodities

Growing tension in Ukraine●Skyrocketing of prices of resources and rise in prices of related products, etc.
●Worsening of corporate earnings due to the augmentation of costs● Enhancement of the trend of monetary easing

Rise in interest rate
●Risk of turmoil in the financial market, including the drop in shareprices, the weakening currencies of emerging countries, etc.
●Sluggish economy recovery due to the rise in interest rate

Worsening of internal and external
economies© 2022 JP-HOLDINGS, INC.

33

Business Environment Surrounding our Company (Supplementary Material)●The number of births was 842,897, hitting a record low. (down 29,786 or 3.4% from the previous year)●The natural population increase/decrease, which is obtained by subtracting the number of deaths from thenumber of births, was 609,000 (decrease), exceeding 600,000 (decrease) for the first time.
●The number of marriages was 514,242, the smallest after WW II (down 23,341 (4.3%) from the previous
year)●Survey targeted at college students: The percentage of those who do not want their children was 14.5%
for women and 7.5% for men, nearly doubling from 6 years ago.
persons

coupleThe number of births

Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec.

The number of marriages

personsJan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec.

The number of deaths

Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec.

month

month

2021

2020

Y/y

Increase/decrease rate

No. of births

842,000

872,000

Down 30,000

Down 3.4%

No. ofmarriages

514,000

537,000

Down 23,000

Down 4.3%

No. of deaths

1,452,000

1,384,000

Up 67,000

Up 4.9%© 2022 JP-HOLDINGS, INC.

34

Policy for the Medium-term Management Plan (Review via a Rolling Method)●Envisioning an ideal state 3 years from now, we will expand the scale of existing businesses, develop andpromote new businesses, and actively engage in them while considering M&A and business alliances.
●In the childcare support business, as competition is projected to become fierce mainly in the Tokyo
Metropolitan area, we will enhance marketing, improve convenience for guardians, and enrich early childhood
learning programs for “developing nursery schools and facilities that would be selected by customers” and aim
to develop the No.1 facility in each region.
① Existing business・To increase the utilization rate of existing facilities
・To enhance marketing in nearby areas
・To implement a new program for early childhood
learning and service plans
We aim to develop the No.1 facility in each region
through regional cooperation, etc.
・Promotion of M&A② Growth of new businesses to trigger synergy
with existing businesses
・Child-rearing assistance platform business・Development support business (support for children
with developmental disabilities)
・Programs and sale of products
・Global operation (Asian region)➡ New initiatives and planning
・To create new business domains for differentiationand enhancing competitiveness

FY 3/24●Internal: Streamlining of management,
personnel development, and curbing of turnoverrate (10% or lower)●External: No.1 nursery school, school clubs,
and children’s houses in each region
Expansion of sales outside the group
Development of the second pillar of business

FY 3/23(review via a rolling method)

FY 3/22
Sales: 34,373 million yen
FY 3/21Net sales: 33,500 million yen

Ideal state 3
years fromnow

FY 3/24(review via a rolling method)

Operating income margin:
10% or higher

・To improve the profitability of existing(To achieve the target
businesses
operating income without
・To increase the number of school clubs andfail)children’s houses, and cooperate in childcare
Sales excluding・Streamlining of management (systematization
subsidies: 10%
and improvement of operations)Turnover rate: 10% or
・To train personnel
・To develop and promote new businesses
lower
Global operation and external sales(marketing and expansion)
・M&A© 2022 JP-HOLDINGS, INC.

35

Medium-term Management Plan (FY 3/22 to FY 3/24)
Expansion of existing businesses, pursuit of expertise, and development of new businesses
Enhancement and promotion of M&A, business alliance, global operation, specialization, andsociality

Existing business ➡
expansion

Business scale
expansion

Pursuit of expertise
Domestic and overseas enterprisesChildcare support business

M&A ➡ of companies in the same field or different fields

Business alliance ➡ Related/different business
Early childhood learning program

SurveyPlatform businessTechnical support

Global operation

New business ➡
Development andexpansion

ResearchMarketing

Development support
Support business byvisiting nursery schools

Marketability andsociality© 2022 JP-HOLDINGS, INC.

36

Target Indicators
We aim to develop “nursery schools and facilities thatwould be selected by customers.”
Long-term
management
vision(To realize nursery schools, facilities, and an enterprise that will be continuously selected byguardians, municipalities, training schools, and officials)

Improvement and expansion of existing businesses, newbusinesses, and capital/business alliances
Target consolidated sales: 100 billion yen

To improve revenues from existing businesses and the qualityof childcare support, and create new value while grasping thechanges in the social and business environments
Mid-termmanagement
goals

Promotion of reform of the management structure and growth strategy in 3 years from FY 3/22
to FY 3/24)

3rd year (final fiscal year) of the medium-term management plan
FY 3/24; Net sales: 36,300 million yen, ordinary income: 3,960 million yen(*To review the plan annually as a rolling method)*From the first quarter of FY 3/22, we have been using a new indication method.
© 2022 JP-HOLDINGS, INC.

37

Activities for Achieving Consolidated Net Sales of 100 Billion Yen
We will evolve our existing businesses and cultivate new(Net sales)
長Unit: 100 million yen
domains for further growth.
期
New business:
経営
50 billion yen●Members-only
platform businessビ●Sale
ジ of existing programs and training●Business related to child-rearing andョ of businesses in the same industry
M&A●Overseasbusiness mainly in Asia
ン
●Creation of new value in cooperation
with Gakken HD

中
期
経
営
目
標

1,000

Strengthening of the sales business
utilizing our know-how
Creation of new businesses utilizing the economies
of scale
Digital business and members-only platform

M&A/business alliance/overseas business+

Existing business:
50 billion yen●Cooperation between nursery schools andschool clubs (to increase our dominance)●Development of nursery schools andfacilities that would be selected bycustomers●Enrichment of digital and learning
programs

New business/M&A

500

Establishment of new school clubs and children’s houses
To increase the number of facilities two times to 200

Improvement of profitability and increase ofoperation rate of existing businesses

Existing businesses (nursery schools, school
clubs and children’s houses)
FY3/22© 2022 JP-HOLDINGS, INC.

38

Management Policies for FY 3/2023 and the Medium-term Management Plan
●Shift from the management system based on “revenue improvement” to the phase based on “business expansion”●To improve operation efficiency through digitalization and systematization, which would support new business strategies, and develop andexecute new businesses●We aim to increase sales and profit, and achieve an operating income margin of 10% or higher.

Corporate ethos

Long-term goals●“We will contribute to the development of a society filled with smiles through our childcare support business.”●Consolidated sales: 100 billion yen (50 billion yen for existing businesses, 50 billion yen for new businesses)
・To become No.1 in each region by establishing “nursery schools and facilities that would be selected by customers” (quality,
reliability, differentiation, and brand development)
・To become an enterprise that will be trusted by local communities and guardians and loved by staff (dissemination of
information inside and outside the company and reform)
・To improve the child-rearing environment in cooperation with local communities and society (developing an environment thatmakes it easier to give birth to and rear children)
・To develop a working environment with worthwhile jobs and enrich the educational system (curbing turnover ratio)
・To create new businesses and establish a pillar of business other than subsidies.
● Establishment of nursery schools and facilities that will be selectedMedium-termManagement Plan
From FY 3/2022
To FY 3/2024

・To advertise our services while enrich programs and developing systems
・To undertake new tasks and establish new facilities in cooperation with after-school childcare
facilities and children’s houses(dominating the market; 200 school clubs and children’s houses)
・To enrich the education and training programs for employees, and curtail turnover ratio byimproving workplaces● Improvement in profitability
・To improve revenues by increasing the number of children accepted and reshuffling personnel(getting out of the red)

● Fortification and streamlining of the management base・To improve operations, reshuffle personnel, and reform organizations to realize a compact head
office・To streamline operations through systematization and allocate management resources efficiently● Promotion of growth strategy
・To enhance the development of new businesses (with the aim of increasing the ratio of sales fromnew businesses to 10%)・To establish and expand the child-rearing assistance platform business

Management
indicators

Nursery schools and facilities thatwould be selected
No.1 in each region

Establishment of the
management baseStreamlining of management(Simple operation)

Establishment of a newpillar of revenues
Ratio of sales: 10% or
higher●Measures for achieving an operating income margin of 10% or higher (through the growth of sales and profit) / To keep turnover ratio from exceeding 10%●To improve revenues from existing businesses(increase of utilization rate, improvement in earning rate, and systematization)● To develop new businesses and aim to increase the ratio of sales from the new businesses to 10% or higher in 3 years© 2022 JP-HOLDINGS, INC.

39

Strategy for Sustainable Growth
Sales have been growing little by little. We will shift to a more profitable structure by reshuffilingpersonnel and obtaining new subsidies.
Net sales: Grew 127.6% between 2018 and 2022.
Ordinary income: Rose 212.3% between 2018 and 2022.
(unit: million yen)
(Sales)To increase sales from businesses other thanexisting ones
Target ratio of such sales: 10% or higher(Currently, it is around 5%.)

(Profit)To support developmentally disabledchildrenMultifunctional facilities (operation of facilities)
Development support business (traveling)

Expansion of the childcare support platform
BtoB, BtoC/Overseas operation

Food-related business
Sale of dishes from Central Kitchen

Scale expansion
FY3/18Net sales

FY3/19OperatingincomeFY3/20Ordinary
incomeFY3/21

FY3/22

Net income attributable to owners of parent

M&A in the same industry (3 billion level througholigopolization)
M&A of related businesses (relevance)© 2022 JP-HOLDINGS, INC.

40

Management Strategy Map
Provision of services and products

Existing businesses

Penetration in markets

New businesses②

・Increase of enrolled children and improvement in
profitability at each facility
・To establish new facilities and make them authorized
・Early childhood learning and new programs(differentiation)
・Improvement in corporate image through branddevelopment activities

To increase revenues further

Development of products andbusinesses
・External sale of existing businesses
・Development of new programs and products*Sales promotion utilizing the childcare support
platform

Enhancement of businessdevelopment③①

Cultivation of new markets
New businesses

Provision in the market

Existing businesses

・New childcare business with digital technologies⇒ Online childcare and digitalization of early childhood learning
programs*Unique operation and cooperation with Gakken

Diversification
in a narrow sense・Development support business (multifunctional facilities)➡ After-school day care
➡ Child development support business➡ Support business by visiting nursery schools

・ Child-rearing assistance platform⇒ Cooperation in different fields and business forincreasing clients・ Creation of new businesses⇒ Business as a new pillar

To extend our existing businesses,
and offer these services early

Cooperation and alliance withenterprises in different fields© 2022 JP-HOLDINGS, INC.

41

Medium-Term Management Plan (FY3/22 to FY3/24)
⦿Concept of the medium-term management plan
“Ideal state” 3 years from now

Plan for the next fiscal year

Changes in the businessenvironment

Formulation of the mediumterm management plan for
the following years

A medium-term management plan is formulated every term, while considering
the changes in the situation.
FY3/22

Rolling method
Method of revising theplan every term, whileconsidering the changes
in the businessenvironment, etc.

Medium-term
management
plan 2022
Medium-term
management
plan 2023
Medium-term
management
plan 2024

FY3/23

FY3/24

FY3/25

FY3/262022～2024
2023～2025
2024～2026© 2022 JP-HOLDINGS, INC.

42

Medium-term Management Plan (FY 3/22 to FY 3/24)
⦿ Plans were reviewed as performance improved greatly in FY 3/22 and numerical targets wereachieved two years ahead of schedule thanks to the new measures, fortification of managementbase and structural reform while considering the changes in the market environment.
Initial forecast

Results

FY3/22

Unit: million yen

Results

Difference
from theinitialforecast

Medium-term Management Plan

FY3/22

FY3/23

FY3/24

Plan

Plan

Plan

Net sales

34,373

3.3%

33,900Operating income

3,344

89.4%

Operating income
margin9.7%

Ordinary income

33,70034,700FY3/22

Unit: million yen

Results

FY3/23

Forecast

FY3/23Y/y

Net sales

34,37335,644

3.7%

2,300

Operating income

3,344

3,565

6.6%

4.4%

6.8%

Operating income
margin

9.7%

10.0%

0.3%

3,358

45.4%

2,300

2,970

3,500

Ordinary income

3,358

3,584

Ordinary income
margin

9.8%

2.8%

6.8%

8.8%

10.1%

Ordinary income
margin9.8%

Net income
attributable toowners of parent

2,279

56.4%

1,450

Net income
attributable toowners of parent

Net income margin

6.6%

2.3%

4.3%

Net income margin

TargetY/y36,313

1.9%

6.7%

3,961

10.5%

10.1%

0.3%

10.9%

0.9%

2,279

2,329

2.2%

6.6%

6.5%

-0.1%

© 2022 JP-HOLDINGS, INC.

43

Priority Measures in Medium-termManagement Plan (as a Rolling
Plan)

44

Major Management Strategies in the Medium-term Management Plan
To adapt to the social environment and implement differentiation strategies based on digitaltechnologies
To actively promote “M&A and business alliances” to operate business and expand its scale

Customeroriented value
creation×

Utilization ofdigitaltechnology

To realize competitive
advantages

×Creation of new
business models!

×

Active promotionof M&A andbusiness allianceestablish nursery schools and facilities that
➡ To
will be selected by customers continuously●Increase of new points of contact withcustomers●Differentiation from competitors●Interactive communication●Enrichment of contents and technical services

To actively promote “M&A and business alliances” to operate business andexpand its scale© 2022 JP-HOLDINGS, INC.

45

Measures From Now On (1)Develop nursery schools and facilities that would be selected byDigitalization

選ばれ続ける園・施設づくりの徹底
customers① Online facility tours and enrichment of external announcement
contents▷Through online facility tours and explanatory material, we will
introduce the characteristics of each facility, common programs, and ourunique operation▷To accept inquiries via our website from the viewpoint of guardians.

Online facility
tours
Nurseryschools
Guardians② Development of strengths of each facility and PR based on the
results of surveys on competitors in the neighborhood▷Cooperation with local communities in events of each facility andlaunch of programs, to popularize our facilities▷Enhancement of PR of each group company and each facility(To disseminate information via social media, YouTube, etc.)③ Development and adoption of attractive programs, andenhancement of PR▷ To introduce the features of each facility and our unique programsin our website and facilities▷ To give lessons on swimming, karate, etc. in cooperation with otherenterprises
To introduce food and agriculture education, etc. outside ourcompany④ English, exercise, eurhythmics, dance (online), lessons in ourown facilities▷In addition to the dispatch of lecturers, we offer learning
opportunities at our own facilities.

Upgrade of our
websiteOnline distribution ofvideosEnglish, gymnastics,
eurhythmics and dance© 2022 JP-HOLDINGS, INC.

46

Measures From Now On (2)Improve profitability in the child-raising support business
Enhance the cooperation between nursery schools andschool clubsImprovement in profitability in the child-raising support
business▷Revenues have increased in each block, but we will try toshare best practices among blocks, to further fix disparities inrevenues in each block or at each nursery school.
▷To promote the sale of real estate we own (facilities thatown land) and improve the efficiency of use of assets
To undertake more projects for schools clubs andchildren’s houses for expanding our dominance▷To undertake more projects for schools clubs and children’shouses mainly in the vicinity of our nursery schools. We
support childcare from babyhood through school-age. We will
increase the number of schools clubs and children’s houses
two times to 200.
▷We will facilitate the exchange between the management
division and the staff of facilities from the aspects of childcare
and child-rearing, and implement measures unique to ourcompany.
Development of personnel who will support nurseryschools and facilities (reform of our awareness anddevelopment of next-generation leaders)▷Enrichment of the training for each class, to improve thelevel of personnel at the head office

Area dominance strategy

Achievement ofour dominanceTo support childcarefrom babyhood toearly childhood toschool-age in our area

Personnel development
Over 300 training
programs

Face-to-facelectures

Online training© 2022 JP-HOLDINGS, INC.

47

③ Optimization of staffing in each section▷To streamline operations, eradicate unnecessary tasks, andoptimize manpower
Employees of the headquarters will work 70% on site and
30% at the head office, to improve hands-on operations andquality of services.

Optimization ofstaffing

Streamliningof operations

By checking the conditions ofworkers, we aim to keep turnoverratio from exceeding 10%.

Curbing of turnoverratio① Review of business operations in each company andeach section/curbing of turnover ratio▷ To streamline business operations by dividing them into
on-site operations and HQ ones
▷ Due to the coronavirus pandemic, the motivation of
employees declined and their risk awareness augmented, so
turnover ratio increased.
Measures for respective areas of nursery staff, lunches, theheadquarters, etc. including the JP condition② To eradicate unnecessary tasks▷Systematization and reform of systems for streamlining
operations at the headquarters and on site
▷To visualize and standardize business operations, to realize
simple operations
・To improve systems for placing orders on site andconducting repair
・To eradicate unnecessary tasks through the reform oforganizations and the improvement of operations, and visualize
and standardize business operations▷To curtail personnel expenses with the central kitchen forlunches

Simple operation
Visualization andstandardization of operations

Systematization
Data analysis
Streamlining ofoperations
Reductionof workload

Development of systems for HR, etc.

System in which they canconcentrate on rearing
and bringing up children

Employees of the HQ
will work 70% on site
and 30% at the HQ.

Streamlining ofoperations© 2022 JP-HOLDINGS, INC.

Quality improvement

Realization of a compact head
officeImprovement inrevenues

Measures From Now On (3)48Measures From Now On (4)Establishment of a central kitchen for lunches

Establishment of a central kitchen① To cook lunches at a central kitchen in cooperation withfood product firms, to reduce operation costs and securesafety and reliability▷To process ingredients at the central kitchen incooperation with food product firms
・To streamline the process of cooking lunches for
employees▷To reduce on-site workload and operation costs
To not only share ingredients, but streamline on-site
operations and reduce workload by processing them at thecentral kitchen, while taking advantage of our nationwide
network▷To demonstrate the operation of the central kitchen in
FY 2022To check the operation by using some facilities, and thenadopt it around Japan
In the future, we will promote the sale of lunches to othercompanies in the same industry

Cooking andprocessing(employees)

To maintainsafety, reliability,and freshness

Central Kitchen

Other
companies in thesame
industry

Delivery to each facility(for employees)
Adoptionin Jul.
2022①Streamlining of staffing②Cost reduction③Sale to othercompanies in the same
field

Adoption in July 2022
For employees’ lunches
Cost reduction
Personnel downsizing
considering the rate ofretirement© 2022 JP-HOLDINGS, INC.

49

Measures From Now On (5)-1
Implementation of growth strategy① Promotion of early childhood learning and new programs▷ Expansion of early childhood learning programs
To increase the number of Mojikazu Land facilities from 62 to 100▷Development of new programs, and improvement of services atfacilities for infants
To adopt dance and art programs
To popularize Increase in recognition of Baby Asc (program for
infants)▷Childcare support utilizing our expertise
Support business by visiting nursery schools/after-school day care
② Cost reduction through integrated procurement▷ To reduce costs through integrated procurement for sale
▷ Procurement while considering the skyrocketing prices ofingredients and discussion on processed products for reducing workload③ Development and promotion of new businesses▷ To establish and start a platform business
To operate new business by making pupils members▷ Business alliances with other enterprises / M&A througholigopolization④ Promotion of business tie-ups and M&A with other companies inthe same field
Business alliances in different fields, M&A in fields surrounding
childcare

Promotion of growth strategy
Enrichment of technical services
Development of new
programs

Enhancement ofdevelopment support

Early childhood
learning programs

Enrichment oftechnical services

Active promotion of M&A(Business scale)
1,000 million yen to 2,000 million yen

Existing businessChild-rearing assistance platform
・Provision of products andservices
・Shift from domestic
operation to global operation

BtoC in FY 3/23
BtoB and cross-border EC in FY 3/24

© 2022 JP-HOLDINGS, INC.

50

Measures From Now On (5)-2・To improve the development support business and offer technical support to existing pupils of nurseryschools, school clubs, and children’s houses
Enrichment of the development support business① Support business by visiting nursery schools▷ Specialized staff visit each facility and offer consultation services for

Support business by visiting nursery schools
Traveling
instructors

development of children who need care.
・Support for disabled children: To hold training and give instructions forenabling them to live in a group・Counselors for pupils, nursery staff, physical therapists, occupational
therapists, psychological counselors, and others who possess the knowledge

and experience of support for disabled pupils visit facilities.
② Promotion of after-school day care and multifunctional facilities■The number of disabled pupils is estimated to be up to 1,350,000.

Establishment ofmultifunctional facilities▷The population of children aged 7 to 18 is around 13.8 million people.

Establishment of afterschool day care in thedominant area

The number of children with disabilities is 450,000, accounting for 3.3%.
The number of children suspected of having a developmental disability is
900,000, accounting for 6.6%.
▷ The national government is encouraging the entry by private enterprises.
■ Establishment of multifunctional facilities
・ Establishment of multifunctional facilities in dominant areas of childcare

centers
・To conduct the development support business in morning, daytime, andevening hours①Morning: Child development
supportPreschoolers②Daytime: Child development
support・Preschoolers
After-school day care・Lower grades of elementary
school
③Evening: After-school day care
Higher grades of elementary
schoolAfter-school
day care
Asc Nursery
SchoolAsc Nursery
SchoolAsc Nursery
School© 2022 JP-HOLDINGS, INC.

51

Measures From Now On (6)-1
Outline of the new business of a childcare platform

To operate it as a new pillar of business besides the existing
business
To makethemmembers

Provisionofservices

Various concerns ofguardians

To make the customers of JP-Holdings Group(pupils and their families) members andlifelong customers, developing a customer
base
To make the pupils of childcare facilities ofour group members: about 16,000 pupils

Provisionofproducts

Services, products, donations ⇔ CtoC, BtoC, BtoB, overseas

About 16,000 pupils

To provide various solutions according to growth
To make the pupils of our childcare facilities and their families
members via our childcare support platform, establishing acustomer base

To realize a world in which reuseis common〇 To thoroughly reuse and recycle products required for raisingchildren, to reduce environmental burdens and disposal〇 To export high-quality childcare goods that are available only inJapan to countries and regions in need, provide high-quality reused
products at affordable prices, to support the child rearing aroundthe worldMarketing
Development(products andservices)

To make them
lifelong
customers
Child-rearing
assistance platform© 2022 JP-HOLDINGS, INC.

52

Measures From Now On (6)-2
Outline of the new business of a childcare platform
Matching site handling goods required for rearing children (brand new, used, and reused goods and services)
To develop new businesses and products through CtoC, BtoC, BtoB, and overseas services and marketing
Donation

Donated goods

Nursery school
Donor(Establishment of donation boxes
in nursery schools)

Matching Service*Registration system/
Free registration

Effective utilizationof resources
Environmental
conservation
SDGs

Purchaser

Individualtransaction

List of products

Purchasing company

Individual

Service contents
Product and service
provision

Expansion ofservice functions

Childrearing support
information*Expansion of service functions
Company

Support on a gradual basis(e.g., expansion of service functions)
Creation of
lifetimecustomers(1)
Marketing(2)

Overseas(individuals andcompanies)
Development ofchildrearing products
Development of service
programs© 2022 JP-HOLDINGS, INC.

53

Measures From Now On (6)-3
Outline of the new business of a childcare platform

Schematic diagram of future business
Product
development/salebusiness

Business expansion
through alliances
Sample adbusiness

Development
support business

Expansion of thecustomer member
base

Business
expansion basedon industryacademia
collaboration

Business scale
FY 3/28

2.5 billion yen(Transaction
volume)Original
programIntroduction andbusiness

dispatch of

Business expansion with themember baseOverseas expansion of our matching
service
BtoC and BtoB matching services

personnel

Expansionofmatching
services

CtoC donation and CtoC matching services© 2022 JP-HOLDINGS, INC.

54

Business Portfolio
Expansion of new business domains through the response to market changes, business tie-up with
Gakken, etc.
High
Brand
development

Improvement incorporate value● Online business*Existing facilities
and external sale

●Synergy for further
growth●New value creation

Growthpotential

Business expansion for
creating new value

EnglishExercise
Eurhythmics
Dance

New operations(expansion)
Existing businesses

Low/
minor

●Development oflecturers for earlychildhood learning

New businessdevelopment

New businessdevelopment

Child-rearing
assistanceplatform(solution)

Training
business

Product
development
and saleEnglishExercise
Eurhythmics
Dance

Increase of points of contact
with customers

Early
childhoodlearning
program●To make pupils,
guardians, and family
members lifelong
customers●Sale of teaching materials(online)*Existing facilities andexternal sale

Development ofmulti-functional
facilities●Development●Development Childcare supportof new
support businessbusiness
programs/exter
Childcarenal sale● To undertake thesupport business
operation of more

CentralKitchen●To undertake theoperation of more
school clubs andchildren’s houses●Streamlining ofoperations/external saleContribution
to revenues

school clubs andchildren’s houses● Implementation of early childhood
learning programs● Online business

Significant© 2022 JP-HOLDINGS, INC.

55

4

Plan for FY 3/23

56

FY3/23 Forecast
FY3/22
Actual

FY3/23
Forecast

ChangeRate ofchange (%)

Net sales (million yen)

34,37335,640

1,267

3.7%

Operating income (million yen)

3,344

3,560

216

6.4%

Ordinary income (million yen)

3,358

3,580

222

6.6%

Net income attributable to owners ofparent (million yen)

2,279

2,325

46

2.0%

Net income per share (yen)

26.06

26.58

0.52

Dividend per share (yen)

4.5

6.0

2.5

Dividend payout ratio (%)

17.3

22.6

5.3

Expected opening of nursery school(school)32-1Expected consignment of school clubs
and children’s houses (facility)

8

11

+3

-

-

© 2022 JP-HOLDINGS, INC.

57

New Openings For FY3/23
FY3/22 New Openings
Nursery Schools: 2
School Clubs: 11
Total: 13

No. of Facilities Operated as of the
End of April 2022
Nursery Schools: 209
School Clubs: 88Children’s houses: 10
Total: 307

1: “Mitaka City Part-time Childcare Center Hinata” began
operation on May 1, 2022.
2: As of March 31, 2022, the Company closed Tokyo
Licensed Nursery Schools named Asc Itabashi-honcho
Nursery School, Asc Shiodome Nursery School, Asc
Takadanobaba Nursery School, Asc Yanokuchi Nursery
School.
In addition, due to the expiration of the contract, the Company
withdrew from school clubs named Rinsen Elementary School
After School Club, Hiroo Elementary School After School Club,
Sarugaku Elementary School After School Club, and achildren's house named Fukuro Children's House on March
31, 2022.

Tokyo:
1 licensed nursery school・Asc Musashi-Koganei Minamiguchi Nursery School
1 non-licensed nursery school・ Mitaka City Flexible Childcare Center Hinata

Tokyo:
2 school clubs and children’s houses
・Takenotsuka School Club・Takaban Elementary School Club・ Wakuwaku Nishi-Ukima Hiroba/Nishi-Ukima Club No. 1
・ Wakuwaku Nishi-Ukima Hiroba/Nishi-Ukima Club No. 2・ Wakuwaku Nishi-Ukima Hiroba/Nishi-Ukima Club No. 3・ Wakuwaku Akabane Hiroba/Akabane Children’s Club No. 1
・ Wakuwaku Akabane Hiroba/Akabane Children’s Club No. 2・ Wakuwaku Akabane Hiroba/Akabane Children’s Club No. 3・ Wakuwaku Kirigaoka-sato Hiroba/Kirigaoka-satokko Club No. 1
・ Wakuwaku Kirigaoka-sato Hiroba/Kirigaoka-satokko Club No. 2・ Wakuwaku Kirigaoka-sato Hiroba/Kirigaoka-satokko Club No. 3© 2022 JP-HOLDINGS, INC.

58

Dividend forecast for FY 3/23
⦿ Dividend policy

・Regarding profit sharing, our company pays dividends while securing internal reserve required for
future business and fortification of our management structure.
・For FY 3/23, we plan to pay an ordinary dividend of 5.0 yen/share and a commemorative dividend of
1.0 yen/share for a total of 6.0 yen/share, as we marked the 30th anniversary of the start of ourbusiness at the end of March 2022.

¥6.0

¥4.50

Ordinary
dividend
5.0 yenCommemorative
dividend
1.0 yen

¥3.90

¥3.90

ratio
32.7%

Payoutratio
30.４%

Payoutratio
63.4%

Payoutratio
17.3%

Payoutratio
22.6%

FY 3/19

FY 3/20

FY 3/21FY 3/22

Forecast
for FY 3/23

¥3.70
Payout* The term-end dividend for FY 3/22 is the dividend per share approved at the 30th annual meeting of shareholders.
© 2022 JP-HOLDINGS, INC.

59

4

APPENDIX60

[Supplementary Material] Scale of the Child-rearing Support-related Market●In fiscal 2020, the scale of this market shrank sharply due to COVID-19.
●Childcare-related services performed well, thanks to the policies for making kindergartens and nurseryschools charge-free and reducing children on waiting lists.
Scale of the Market Related to Child-rearing and Childcare[100 million yen]
Scale of the market related to child-rearing[100 million yen]

Scale of the market of childcare-related service
Nursery school

After-school childcare

Baby-sitting

Preschool

Childcare-related service

2013

2014

2015

2016

2017

2018

2019

2020

2013

2014

2015

2016

2017

2018

2019

2020

Source: Yano Research Institute Ltd.’s General Marketing in the Market for Children: Annual (2020 Issue)© 2022 JP-HOLDINGS, INC.

61

[Supplementary Material] Variations in the Number of Children on Waiting Lists andthe Ratio of Children Enrolled in Nursery Schools, Etc.
● The total capacity of nursery schools, etc.: 2.97 million children, up 79,000 children from the previous year
●The number of children enrolled in nursery schools, etc.: 2.74 million, up 58,000 from the previous year
● The number of children on waiting lists: 12,439, down 4,333 from the previous year
Variations in the number of children on waiting lists for andthe ratio of children enrolled in nursery schools, etc.
(Children)(Children)

Situation of the total capacity of nurseryschools, etc. and the number of children
enrolled
No. of nursery schools, etc.

No. of children on waiting lists

Total capacity

Ratio of children enrolled in childcare facilities (overall)No. of children enrolled

Ratio of children enrolled in childcare facilities (1 or 2-year-old children)

2012

2013

2014

2015

2016

2017

2018

2019

2020

2018

2019

2020

Source: Ministry of Health, Labour and Welfare’s Summary of the Situation of Nursery Schools, Etc.

© 2022 JP-HOLDINGS, INC.

62

[Supplementary Material] Current Waiting List Situation
National Waiting List Map (April 1, 2021)

⦿ The number of children on waiting lists as ofApr. 1, 2021 is 5,634 (6,805 decrease YoY).
The problem of children on waiting lists
remains serious. This is especially so in theTokyo metropolitan area and prefectures
where major cities (e.g. ordinance-designatedcities) are located.

No of Prefectures

Current as of April 1, 2021
R3年4月1日現在(都道府県数)

0

(12)
0人

(12)

(21)

1 or more but less than 100(21)

100 100人以上500人未満
or more but less than 500(10) (10)500500人以上1,000人未満
or more but less than 1,000(4)

１人以上100人未満

1,000人以上(0)1,000 or more

(4)
(0)

注：各道府県には政令指定都市・中核市を含む。

注：各都道府県には指定都市・中核市を含む。

Source: Ministry of Health, Labour and Welfare’s Nursery School Situation Summary (April 1, 2021)

都道府県

待機児童数

待機児童率

人

％

北海道
青森県
岩手県
宮城県
秋田県
山形県
福島県
茨城県
栃木県
群馬県
埼玉県
千葉県
東京都
神奈川県
新潟県
富山県
石川県
福井県
山梨県
長野県
岐阜県
静岡県
愛知県
三重県
滋賀県
京都府
大阪府
兵庫県
奈良県
和歌山県
鳥取県
島根県
岡山県
広島県
山口県
徳島県
香川県
愛媛県
高知県
福岡県
佐賀県
長崎県
熊本県
大分県
宮崎県
鹿児島県
沖縄県
計

68
0
12
222
10
0
62
13
0
4
388
428
969
306
0
0
0
0
0
21
0
61
174
50
184
6
158
769
132
30
0
1
104
14
15
23
29
33
12
625
24
0
8
0
1
114
564
5 ,6 3 40 .0 80 .0 00 .0 4
0 .5 00 .0 50 .0 00 .1 80 .0 20 .0 00 .0 1
0 .2 80 .3 5
0 .3 00 .1 70 .0 00 .0 00 .0 00 .0 00 .0 00 .0 40 .0 00 .0 90 .1 1
0 .1 2
0 .5 00 .0 10 .0 8
0 .6 6
0 .4 90 .1 50 .0 00 .0 00 .2 10 .0 20 .0 60 .1 40 .1 30 .1 30 .0 6
0 .5 00 .1 00 .0 00 .0 10 .0 00 .0 00 .2 7
0 .9 1
0 .2 0© 2022 JP-HOLDINGS, INC.

63

[Supplementary Material] Basic Concept of the Child-rearing Assistance Platform “codomel”(1) Platform name(2) Concept of theplatform name andlogo

codomelCodomel is a word we have coined by combining the word for children in Japanese of “codomo” with the word
for product in Latin of “merx.” We have used the colors of the five initiatives we will attempt to achievethrough this service from among the 17 SDGs: “1. No Poverty,” “3. Good Health and Well-being,” “7.
Affordable and Clean Energy,” “10. Reduced Inequalities” and “16. Peace, Justice and Strong Institutions.” In
addition, the circular design made by people linking their hands expresses the “circle for everyone,” which wewill create by connecting children, parents and local communities through this service(3) Logo(4) Overview of thefirst services

The first services of the codomel childrearing assistance platform will be a matching service in which users can
individually sell and purchase used goods over the Internet focused on childrearing-related supplies (e.g.,baby supplies and clothing) mainly for the childrearing generation and a service to provide products highly
needed by the childrearing generation and childrearing-related information and services. We will also collectchildrearing-related supplies and clothing donated by parents at the nursery schools operated by our groupand then provide them as used goods. We will unroll this service overseas and further expand services after
the launch of this service on April 1, 2022.

© 2022 JP-HOLDINGS, INC.

64

[Supplementary Material] Current Nursery School Teacher Shortage Situation
 The ratio of job openings to job applicants for nursery school teachers isdecreasing. However, there is a continuing shortage of nursery school teachers
across Japan. (National average as of February 2022: 2.78 times)
 Jobs to applicants ratio of Tokyo had the trend of increase at 3.77 as of Dec.
2021, but turned to decrease to 2.97 as of Feb. 2022.
Effective Opening to Application Ratio for Nursery School Teachers (X)8Nationwide
7

Tokyo

6
5
4
3
2

Feb.
2.97
●
●

Feb.
2.78

1
0

Source: Ministry of Health, Labour and Welfare Employment Security Bureau’s General Job Placements (Report on Employment Service)© 2022 JP-HOLDINGS, INC.

65

[Supplementary Material] Recruitment of Nursery School Teachers
FY3/16New
Nursery School Graduates
Teacher
Mid-career
employment
New
Non qualified
Graduates

FY3/17

FY3/18

FY3/19FY3/20FY3/22Joined on
the 1st of Apr.

FY3/21

197

247

276

248

182

166

241

327

325

269

292

226

23

32

46

26

9

7

166
211
（Full-year plan: 270）5*After joining JPHD, non qualified graduates are expected and assisted to acquire nursery school teacher qualification. Started this recruitment style from FY2016.
*Includes seconded employees to associated companies

Trend of Employee Numbers in Childcare Support Business(Persons)(*Includes employees of school clubs staffs, nutritionists, etc. other than nursery school teachers)
Employees
Part-time workers

FY3/08

FY3/09FY3/10FY3/11

FY3/12

FY3/13

FY3/14

FY3/15

FY3/16

FY3/17

FY3/18

FY3/19FY3/20FY3/21© 2022 JP-HOLDINGS, INC.

66

[Supplementary Material] Changes in the Number of Facilities Operated and the
Number of Children Accepted to Nursery Schools
FY3/11
Licensed Nursery Schools(Public-private management)
Licensed Nursery Schools(Private management)
Small-scale Nursery Schools
Tokyo Licensed
Schools
Company-led
NonNurseries
licensedNon-licensed
Nursery
Municipality
Schools
Authorized
Non-licensed
Other non-licensed
School Clubs
Children's Houses
Private School Clubs
Kindergartens (Overseas
Facility)

Total

FY3/12

FY3/13

FY3/14

FY3/15

FY3/16

FY3/17

FY3/18

FY3/19FY3/20FY3/21

FY3/22

10

11

14

16

14

10

10

11

12

12

11

11

43

61

71

85

102

118

136

148

160

171

177

182

0

0

0

0

0

0

0

0

2

0

0

0

26

26

26

26

26

26

23

21

21

20

19

13

0

0

0

0

0

0

0

0

2

2

2

1

4

4

4

4

4

1

0

0

0

0

0

0

0

0

0

0

0

4

3

3

3

4

4

4

37
9
0

39
7
0

40
8
0

43
8
0

46
8
0

55
10
0

63
12
4

71
12
5

72
11
5

72
11
4

77
11
0

81
11
0

0

0

0

0

0

0

0

1

1

1

0

0

129

148

163

182

200

224

272

289

297

301

303

251

*We reviewed the count by management structure in the 2Q of FY3/16 and changed three licensed schools (public-private management) to other non-licensed nursery schools.

TREND OF NURSERIES AND CHILDREN

Number of Children

Number of facilities
Non-licensed Othernon-licensed
Non-licensed Municipality Authorized

15,323 15,581 15,581

300

14,058 14,350

Company-led Nurseries
Tokyo Licensed Schools
Small-scale Nursery Schools
Licensed Nursery Schools(Private management)
Licensed Nursery Schools(Public-private management)
Nerseries Total
Children in Nurseries

10,461200

11,192

9,350
8,133
6,956

150
5,500

100

14000

12,375

250

102

115

131

146

159

172

16000

183

209

200

212

211

12000
10000
8000

6000

83

4000

50

2000

0

0
FY 3/11

FY 3/12FY 3/13

FY 3/14

FY 3/15FY 3/16

FY 3/17

FY 3/18

FY 3/19

FY 3/20

FY 3/21FY 3/22© 2022 JP-HOLDINGS, INC.

67

[Supplementary Material] Consolidated Results (Highlights)
FY3/18

FY3/19FY3/20FY3/21

FY3/22

Net sales (million yen)

26,94529,64732,16933,50034,373Operating income (million yen)

1,469

1,880

1,989

2,857

3,344

Ordinary income (million yen)

1,469

1,920

2,003

2,947

3,358

Net income attributable toowners of parent (million yen)

910

1,071

1,122

537

2,279

Net income per share (Yen)

10.70

12.44

12.81

6.15

26.06

*Net sales and operating income are the amounts after the reclassification of presentation methods.
Net sales
売上高(million yen)
（百万円）

売上高
Net
sales

40,000

営業利益
Operatingincome

経常利益
Ordinary

Operatingincome/Ordinary income
営業利益・計上利益(million yen)
（百万円）

income4,000

35,0003,500

30,0003,000

25,0002,500

20,0002,000

15,0001,500

10,000

1,000

5,000

500

0

0
2018年3月期
FY3/182019年3月期
FY3/192020年3月期
FY3/202021年3月期
FY3/212022年3月期
FY3/22© 2022 JP-HOLDINGS, INC.

68

[Supplementary Material] Consolidated Results (Balance Sheet/Statement of Cash Flows)

FY3/18

FY3/19FY3/20FY3/21

FY3/22

Total assets (million yen)

25,75828,255

26,122

29,74034,274

Net assets (million yen)

7,756

8,950

9,636

10,007

11,975

Shareholders’ equity ratio (%)

30.1

31.7

36.9

33.7

34,9

FY3/18

FY3/19FY3/20FY3/21

FY3/22

Cash flows from operating
activities (million yen)

1,865

1,829

2,320

2,469

3,884

Cash flows from investing
activities (million yen)

-1,292

-940

418

190

413

Cash flows from financing
activities (million yen)

-135

1,475

-3,349

2,155

1,978

Year-end balance of cash andcash equivalents (million yen)

4,455

6,816

6,206

11,02017,296© 2022 JP-HOLDINGS, INC.

69

[Supplementary Material] Dividends
The basic policy of our company is to continue paying a performance-linked dividend with a payout ratio ofaround 30% while maintaining the necessary internal reserves for future business development and tostrengthen our management structure.
FY3/18

FY3/19FY3/20FY3/21

FY3/22

Amount of dividend pershare (yen)

3.50

3.70

3.90

3.90

4.50

Payout ratio (%)

32.7

29.7

30.4

63.4

17.3

© 2022 JP-HOLDINGS, INC.

70

Response to the Change in the Indication Method
Response to the change in the indication method●With regard to subsidies, etc. received from local governments for rental company housing for nursery school
teachers, the amount was previously recorded as "Subsidy income" under non operating income, but from the current
fiscal year, such subsidies, etc. are now recorded as "Net sales."● This change in presentation is due to the fact that the qualitative importance of such subsidies, etc. to thechildcare business has increased, and that, as a result of confirming and organizing the subsidy system related to thechildcare business as a result of investigating and studying the "Accounting Standard for Revenue Recognition,” wemade the judgment that it would be possible to present the actual status of the business more appropriately if therelevant amounts were recorded in the same category as other subsidies. Due to this change in presentation,
reclassifications have been made for the previous fiscal year.

© 2022 JP-HOLDINGS, INC.

71

Forecast Precautions
This document contains forecasts about the future. However, these are predictions thathave been made by our company based on the information available at the time of
publication. The reality may be significantly different from our predictions due to economic
conditions and market trends. Furthermore, this document is not intended to solicit
investment. We are under no obligation to amend or change the information pertaining toforecasts contained in this document even if we obtain new information in the future.

Inquiries:
5F Shinagawa Season Terrace, 1-2-70 Konan, Minato-ku Tokyo
JP-HOLDINGS, INC. Tokyo Office
Corporate Communications & Investor Relations Div.
TEL: 03-6433-9515 e-mail : jphd_pr@jp-holdings.co.jp

Copyright©JP-HOLDINGS,INC All Rights Reserved.