Summary of Business Results for the Second Quarter Ended September 30, 2022
[Japan GAAP] (Consolidated)
November 10, 2022
Company
JP-HOLDINGS, INC.
Listed on the TSE Prime
Stock Code2749
URL: https://www.jp-holdings. co.jp
Representative
Tohru Sakai, President and Representative Director
Contact
Ryoji Tsutsumi, Director
T E L: +81-52-933-5419
Expected date of filing of quarterly securities report: November 10, 2022
Expected starting date of dividend payment: Preparation of quarterly supplementary financial document: Yes
Quarterly results briefing: Yes (for media members, institutional investors, analysts)（Rounded down to million yen）

1. Consolidated business results for the six months ended September 2022
(April 1, 2022 through September 30, 2022)(1) Consolidated results of operations(% change from the previous corresponding period)
Net sales

Operating income

Million yen% Million yen%
17,207
2.3
1,502
37.2
Six months ended Sept. 2022
16,814
3.4
1,095
16.7
Six months ended Sept. 2021
(Note) Comprehensive income
Six months ended September 2022: 1,094 million yen (53.7%)
Six months ended September 2021: 712 million yen (13.5%)
Net income
Diluted net income perper share
share
Yen
Yen
12.92
Six months ended Sept. 2022
8.11
Six months ended Sept. 2021

Ordinary income
Million yen
1,521
1,111

%
36.9
16.3

Net income attributable toowners of parent

Million yen
1,130
708

%
59.4
28.6

(2) Consolidated financial position
Total assets

Net assets

Million yen
33,158
As of Sept. 30, 2022
34,274As of Mar. 31, 2022
(Reference) Shareholders’ equity:
As of September 30, 2022: 12,680 million yen
As of March 31, 2022: 11,975 million yen

Million yen
12,68011,975

Shareholders’ equity
ratio
%
38.2
34.9

2. Dividends
End of 1Q

Annual dividend
End of 3Q
Yen
Yen
0.00
0.00
-

End of 2Q
Yen-

Year-end

Year ended Mar. 2022
Year ending Mar. 2023
Year ending Mar. 2023 (forecast)(Note) Revisions to dividend forecast for the current quarter: None
Breakdown of year-end dividend for the fiscal year ending March 2023
Ordinary dividend: 5.00 yen, Commemorative dividend: 1.00 yen

Total

Yen
4.50

Yen
4.50

6.00

6.00

3. Forecast of consolidated business results for the fiscal year ending March 2023
(April 1, 2022 through March 31, 2023)(% change from the previous corresponding period)
Net sales

Net income attributable toowners of parent

Net income
per share

Operating income

Ordinary income

Million yen%

Million yen%

Million yen%

Yen

Year ending Mar. 2023
35,6403.7
3,633(Note 1) Revisions to business forecast for the current quarter: Yes

8.6

3,711

10.5

2,566

12.6

29.64

Million yen%

*Notes(1) Changes in significant subsidiaries during the period: None
(2) Application of accounting procedures specific to preparation of the consolidated quarterly financial statements:
None(3) 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: Yes: None: None: None(4) Shares outstanding (common stock)①Number of shares outstanding at the end of period (treasury stock included)
As of September 30, 2022
87,849,400 shares
As of March 31, 2022
87,849,400 shares②Treasury stock at the end of period
As of September 30, 2022
366,432 shares
As of March 31, 2022
380,707 shares③Average number of stock during period (quarterly cumulative period)
Six months ended September 2022
87,474,811 shares
Six months ended September 2021
87,468,693 shares*Quarterly financial summary is not subject to the quarterly review 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 the Company 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 assumptions that form the basis for the business results
forecasts and notes about using business forecasts, please refer to “1. Qualitative Information on Quarterly Financial Results (3)Consolidated Earnings Forecasts” (Page 5).
∙ The Company plans to hold an online meeting as the financial results briefing for media members, institutional investors andanalysts on Friday, November 18, 2022. The financial results briefing for individual investors is planned to be held on Friday,
December 16, 2022 via face-to-face and online.

〇 Table of Contents of the Appendix

1. Qualitative Information on Quarterly Financial Results……………………………………………… 2(1) Results of Operations……………………………………………………………………………….. 2(2) Financial Position…………………………………………………………………………………… 4(3) Consolidated Earnings Forecasts……………………………………………………………………. 5
2. Quarterly Consolidated Financial Statements and Major Notes……………………………………….. 6(1) Quarterly Consolidated Balance Sheets……………………………………………………………… 6(2) Quarterly Consolidated Statements of Income and Statements of Comprehensive Income…………. 8(3) Notes on Quarterly Consolidated Financial Statements……………………………………………… 10(Notes on going concern assumption)……………………………………………………………… 10(Notes if there is a significant change in the amount of shareholders' equity)……………………... 10(Changes in accounting policies)…………………………………………………………………… 10―1―1. Qualitative Information on Quarterly Financial Results(1) Results of Operations
In the second quarter under review, the Japanese economy continued to be affected by COVID-19. While social and economic
activities showed signs of normalization due to the relaxation of some restrictions and other factors, the outlook remains uncertain
regarding geopolitical risks caused by the situation in Ukraine, price increases due to the depreciation of the yen, and the impact ofsoaring crude oil and raw material prices on the domestic economy and corporate earnings.
Meanwhile, in the child-raising support business, conditions remained challenging due to the acceleration of the declining birthrate accompanying the sharp drop in the birth rate, the continuing shortage of childcare workers, and a decline in the number ofchildren on waiting lists because of people refraining from using the facilities due to COVID-19. The government has beenpromoting various measures to improve the childcare environment, such as the development of childcare services based on the"New Childcare Security Plan" and the further acceleration of the development of after-school children's clubs under the "NewComprehensive Plan for After-school Children" in order to eliminate the waiting list for children. In addition, the bill forestablishment of the “Children's Agency” was promulgated by the Cabinet. The government plans to establish the Agency in April
2023 and is promoting to create a better environment for childcare. In such circumstances, the social role of the child-raising
support business will become increasingly important.
Under these situations, as measures against COVID-19, our group, in collaboration with local governments, has established ourown response standards and implemented thorough safety measures with giving top priority to ensuring the safety of children,
parents, business partners, and employees. At the same time, we also have been taking prompt measures.
Rather than prioritizing quantitative expansion through the opening of new facilities, we are required to transform ourselves into
"facilities that would continue to be selected by customers" by further improving the quality of our childcare support in response tochanges in the social environment and the needs of parents. In order to respond promptly to these changes in the environment, ourGroup has set more reliable management targets.
Our Group will continue to take advantage of changes in the social and business environment and maintain the management
policies formulated in the previous fiscal year with the key objectives of "improve profitability and efficiency," "improvesoundness," and "improve growth potential." We will effectively allocate and invest management resources to build a solidmanagement foundation and aim for sustainable growth through the creation of new businesses.
Specifically, with Digital Transformation (DX) as the pillar of reform to respond to changes in the social environment, in terms of"improve profitability and efficiency," we are promoting a dominant strategy in collaboration with nursery schools, school clubs,
and children's houses with these initiatives: improve early learning to increase the number of children accepted at existingchildcare support facilities as our existing business, develop and introduce new content, develop new childcare facilities
specializing in English education, improve profitability by further optimizing staffing, and establish an integrated child-rearing
support system that captures the infant, early childhood, and children's period. As a result, we are actively promoting new contracts
to double the current number of school clubs and children's houses to 200 facilities.
With regard to “improve soundness”, we will expand our human resource education and training systems as the key to childcare
support is "human resources.” At the same time, we will improve the sophistication of operations by improving operational
efficiency. In addition, we will further improve the quality of our childcare support and promote the creation of “facilities thatwould continue to be selected by customers” by disseminating and implementing both internally and externally the Group's
Management Philosophy, Corporate Message, Operational Philosophy, Childcare and Nurturing Philosophy, and Childcare andNurturing Policy, which were renewed and formulated last year. In addition, we are working to eliminate wasteful operations byreviewing various operations and to improve operational efficiency by promoting systematization.
With regard to "improve growth potential," we are actively promoting the development of new businesses based on the know-how
and marketing cultivated through the operation of the child-raising support business as the second pillar of our business.
We have started operation of "codomel," a child-raising support platform, as a new business to provide various services andproducts during the process of children's growth and for external sales to other companies in the same industry. As a first step, weare expanding the number of registered members by offering matching services in which users individually sell and purchase baby
care goods, apparel, and other goods (reused goods) on the web, centered on the childrearing generations. In the future, we intend
to expand our various services and businesses not only domestically but also globally, including the provision of services incollaboration with various companies, introduction and dispatch of professional personnel, and on-demand streaming ofprofessional training programs.
Furthermore, as a food business that responds to the needs of parents with preparations for dinner, we are planning to develop
products and sell them using the "codomel" childcare support platform. Specifically, we will commercialize nutritionally balanced
meals prepared by our nutritionists and sell them to parents for their dinner. At the same time, each facility will offer services tosolve parents' problems, such as providing meals for both parents and children, and preparing and providing diapers and othernecessary equipment for each age group at each facility.
In addition, our group has strengthened and promoted support for children with developmental concerns, such as through support
programs for visiting child care facilities, etc. Based on the know-how we have cultivated through child-raising support, we will―2―

expand our support for children with potential for developmental disabilities based on high levels of expertise, and provide childraising support to more children and parents, including the establishment of multi-functional facilities.
As for the new facility openings, the Group has opened a total of 14 facilities during the second quarter of the fiscal year ending
March 2023 according to the plan, including 2 nursery schools (2 in Tokyo) and 12 school clubs and children's houses (12 in
Tokyo).
(Nursery school)
Asc Musashi-Koganei Minamiguchi Nursery School(Apr. 1, 2022)

Mitaka City Flexible Childcare Center Hinata(Apr. 1, 2022)(School club/Children's house)
Takenotsuka School Club

(Apr. 1, 2022)

Takaban Elementary School Club

(Apr. 1, 2022)

Wakuwaku Nishi-Ukima Hiroba/Nishi-Ukima Club No. 1(Apr. 1, 2022)

Wakuwaku Nishi-Ukima Hiroba/Nishi-Ukima Club No. 2(Apr. 1, 2022)

Wakuwaku Nishi-Ukima Hiroba/Nishi-Ukima Club No. 3(Apr. 1, 2022)

Wakuwaku Akabane Hiroba/Akabane Children’s Club No. 1(Apr. 1, 2022)

Wakuwaku Akabane Hiroba/Akabane Children’s Club No. 2(Apr. 1, 2022)

Wakuwaku Akabane Hiroba/Akabane Children’s Club No. 3(Apr. 1, 2022)

Wakuwaku Kirigaoka-sato Hiroba/Kirigaoka-satokko Club No. 1(Apr. 1, 2022)

Wakuwaku Kirigaoka-sato Hiroba/Kirigaoka-satokko Club No. 2(Apr. 1, 2022)

Wakuwaku Kirigaoka-sato Hiroba/Kirigaoka-satokko Club No. 3(Apr. 1, 2022)

Bunkyo-ku Meidai Temporary Chidcare Room

(Jun. 1, 2022)*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, theCompany withdrew from school clubs named Rinsen Elementary School After School Club, Hiroo Elementary School After School Club,
Sarugaku Elementary School After School Club, and a children's house named Fukuro Children's House on March 31, 2022.

As a result, the Group came to have 209 nursery schools, 89 school clubs, 10 children's houses, making a total of 308 facilities
for supporting child-raising at the end of September 2022.
As a result, the Group’s consolidated net sales were 17,207 million yen (up 2.3% year on year), operating income was 1,502
million yen (up 37.2% year on year), ordinary income was 1,521 million yen (up 36.9% year on year), and net income
attributable to owners of parent was 1,130 million yen (up 59.4% year on year).
The major factors are as follows:
Despite the complete lifting of the stricter COVID-19 measures, the number of new cases of the infection has been fluctuating,and the operating environment has been severe, with each our facility becoming partially closed. However, the number ofchildren accepted increased owing to various initiatives to create “facilities that would continue to be selected by customers”,
such as implementing online facility tours and online learning programs such as English, gymnastics, eurhythmics and dance, as
well as introducing a new early learning program even under the COVID-19 crisis. As a result, net sales increased by 2.3% year
on year.
In terms of operating income and ordinary income, net sales increased due to the opening of new facilities and an increase in thenumber of children accepted during the period as a result of the various measures mentioned above, while each facility improved
its profitability and reduced costs through efficient operation by reallocating personnel and reviewing the ordering system tocontrol the sharp rise in the prices of various purchased products. Operating income increased by 37.2% year on year andordinary income increased by 36.9% year on year. This was mainly due to an increase in provision for bonuses resulting from achange in the period covered by bonuses following the introduction of a new personnel system, as well as an increase in
expenses resulting from special factors associated with the introduction of a new system in the previous fiscal year.

―3―Net income attributable to owners of parent increased significantly by 59.4% year on year. In addition to the increase inoperating income and ordinary income mentioned above, the Company recorded extraordinary income of 215 million yen fromthe sale of fixed assets (land and buildings) of 1 of 7 nursery schools, in which we acquired land and building as a foothold forour child-raising support business in the past, in the second quarter of the fiscal year ending March 2023, as we considered offbalance sheet financing for these facilities to avoid the risks of holding such assets.

(2) Financial Position
As for the financial position at the end of the second quarter of the current fiscal year, the total assets amounted to 33,158 million
yen (down 1,116 million yen from the end of the previous fiscal year).
Current assets totaled 20,372 million yen (down 558 million yen), mainly reflecting an increase of 96 million yen in others,
while there were decreases of 321 million yen in cash and deposits, 283 million yen in accounts receivable, and 26 million yen innotes and accounts receivable - trade.
Fixed assets totaled 12,785 million yen (down 557 million yen). This was mainly due to decreases of 170 million yen inbuildings and structures, 137 million yen in construction in progress, 133 million yen in land, 90 million yen in long-term loans
receivable, and 78 million yen in guarantee deposits, while there was an increase of 91 million yen in tools, furniture andfixtures.
Total liabilities amounted to 20,478 million yen (down 1,821 million yen).
Current liabilities were 7,492 million yen (down 399 million yen), mainly due to a decrease of 185 million yen in accounts
payable, 130 million yen in current portion of long-term loans payable, and 128 million yen in income taxes payable, despite anincrease of 133 million yen in other items.
Fixed liabilities totaled 12,986 million yen (down 1,421 million yen). This was mainly due to a decrease of 1,439 million yen in
long- term loans payable.
Total net assets as of the end of the second quarter of the current fiscal year totaled 12,680 million yen (up 704 million yen fromthe end of the previous fiscal year), mainly because retained earnings increased by 736 million yen, while valuation difference on
securities decreased by 46 million yen.

―4―(3) Consolidated Earnings Forecasts
For the full-year business forecasts announced on May 12, 2022, the Company revised the forecasts upward based on the results
for the second quarter of the fiscal year ending March 2023, as follows. For details, please refer to the "Notice of Upward
Revisions to Full-year Business Forecasts" dated November 10, 2022.
In our consolidated business forecasts for the fiscal year ending March 2023, we expect sales to be at the initial forecast level,
despite a decline in the number of children accepted at the beginning of the fiscal year due to the accelerated decline in thebirthrate and the impact of COVID-19. This is due to the promotion of following various initiatives to create "facilities that would
continue to be selected by customers": implementing online facility tours and online learning programs such as English,
gymnastics, eurhythmics, and dance, introducing a new early learning program, developing swimming classes in cooperation withneighboring facilities.
Operating income and ordinary income are expected to increase by 2.1% and by 3.7% compared to the initial forecasts due toefforts to control expenses and maximize subsidies received through efficient management by the reallocation of personnel at eachfacility and a review of the ordering system and operation to curb price hikes.
Net income attributable to owners of parent is expected to increase by 10.4% compared to the initial forecast. This is due to factors
such as the establishment of the above-mentioned efficient management system and the recording of an extraordinary income fromthe sale of fixed assets (land and buildings) of 1 of 7 nursery schools, in which we acquired land and building as a foothold for ourchild-raising support business in the past, in the second quarter of the fiscal year ending March 2023, as we promote off-balance
sheet financing for these facilities to avoid the risks of holding such assets.
These efforts are implemented to improve profitability and expand the number of children we accept not only for the current fiscal
year but also for the next fiscal year. These initiatives have been successful in creating “facilities that would continue to be selectedby customers” in each region, as we could increase the number of visitors to our facility tours. We believe that they will have asignificant impact on the expansion of our business in the next fiscal year and beyond.
In addition, we will also develop and operate new businesses in collaboration with existing businesses to achieve sustainablegrowth, including a food business that captures the needs of parents, a service that provides the necessary equipment for childcare
centers, the development of new facilities specializing in English education, and the expansion of the service functions of the"codomel" child-raising support platform.
Actual results may differ from forecasts due to changes in business conditions and other factors in the future. If there are anychanges, the Company will disclose them properly.
Since the timing of the containment of COVID-19 remains uncertain, there is a possibility that it will have a major impact on
consolidated results depending on the spread and containment of the infection and other factors in the future.

―5―

2. [Quarterly Consolidated Financial Statements](1) [Quarterly consolidated balance sheets](Thousand yen)Previous Fiscal Year
(March 31, 2022)

Current Second Quarter(September 30, 2022)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade17,296,668
68,65016,974,967
42,002Inventories
Accounts receivable - other

63,9002,708,806

39,3242,425,290

794,924-1,766

891,780-934

20,931,185

20,372,430

12,326,804

12,246,978

Accumulated depreciation and impairment-7,450,666-7,541,493

Buildings and structures, net

4,876,138

4,705,484

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

Machinery, equipment and vehicles

203

203

Accumulated depreciation

-121

-135

Machinery, equipment and vehicles, net

82

67

1,106,051

1,241,117

Accumulated depreciation and impairment-820,246-863,327

Tools, furniture and fixtures, net

Tools, furniture and fixtures

285,804

377,790Land
Construction in progress

435,909
137,030

302,486-

Total tangible fixed assets

5,734,966

5,385,828

136,736

121,543

Intangible assets
Goodwill
Other

37,90442,869Total intangible assets

174,640

164,412Investment securities
Long-term loans receivable

453,084
2,989,672

408,373
2,898,887

Guarantee deposits
Deferred tax assets

1,903,902
1,579,652

1,825,437
1,604,002

Other
Allowance for doubtful accounts

513,833-6,123503,842-4,815

Total investments and other assets

7,434,021

7,235,729

13,343,629

12,785,970

34,274,814

33,158,401

Investments and other assets

Total fixed assets
Total assets―6―

(Thousand yen)Previous Fiscal Year
(March 31, 2022)

Current Second Quarter(September 30, 2022)

Liabilities
Current liabilities
Notes and accounts payable-trade
Current portion of long-term loans payable

165,552
3,113,291

133,974
2,982,463

Accounts payable – other
Income taxes payable

1,561,978641,517

1,376,264
512,994

Accrued consumption taxes
Reserve for bonuses

143,892
906,420

100,006
920,160

Asset retirement obligation
Other

49,652
1,309,498

23,635
1,442,525

Total current liabilities

7,891,803

7,492,024

Long-term debt
Retirement benefit liability

12,816,466
940,313

11,377,054
984,032

Asset retirement obligation
Other

647,1273,650

624,917158

14,407,557

12,986,162

22,299,361

20,478,187

Shareholders’ equity
Capital1,603,955

1,603,955

Capital surplus
Retained earnings

1,449,544
9,117,409

1,449,053
9,854,069

Fixed liabilities

Total fixed liabilities
Total liabilities
Net assets

Treasury stock-107,515-103,483

12,063,393

12,803,593

Accumulated other comprehensive income
Valuation difference on available-for- salesecurities
Deferred gains or losses on ledges-49,918-96,349-2,533-109

Remeasurements of defined benefit plans-35,488-26,920

Total shareholders’ equity

Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets―7―-87,940-123,379

11,975,452

12,680,214

34,274,814

33,158,401

(2) [Quarterly Consolidated Statements of Income and Statements of Comprehensive Income][Quarterly Consolidated Statement of Income][Second Quarter of FY3/23]

Net sales
Cost of sales

Previous Second Quarter(Apr. 1, 2021
- September 30, 2021)
16,814,993
14,149,058(Thousand yen)
Current Second Quarter(Apr. 1, 2022
- September 30, 2022)
17,207,871
14,300,013

Gross profit

2,665,935

2,907,858

Selling, general and administrative expenses

1,570,399

1,404,938

Operating income

1,095,535

1,502,920

39,12139,806Other

10,094

16,032

Total non-operating income

49,21555,839Interest expenses
Other

30,4972,674

35,474
1,318

Total non-operating expenses

33,172

36,793

1,111,579

1,521,966

Gain on sales of fixed assets-

215,276

Extraordinary income

Non-operating income
Interest income

Non-operating expenses

Ordinary income
Extraordinary income-

215,276

Extraordinary loss
Loss (gain) on retirement of fixed assets

35

108

Loss on sales of investment securities

3,052

-

3,087

108

Income before income taxes and others

Total extraordinary loss

1,108,492

1,737,134

Corporate, inhabitant and enterprise taxes
Income taxes-deferred

442,135-42,585

616,304-9,439Total income tax

399,549

606,864

Net income

708,942

1,130,270

Net income attributable to owners of parent

708,942

1,130,270―8―

[Quarterly Consolidated Statement of Comprehensive Income][Second Quarter of FY3/23]
Previous Second Quarter(Apr. 1, 2021
- September 30, 2021)
708,942(Thousand yen)
Current Second Quarter(Apr. 1, 2022
- September 30, 2022)
1,130,270

Valuation difference on available-for- sale securities
Deferred gains or losses on ledges-8,1171,040-46,430
2,423

Remeasurements of defined benefit plans

10,398

8,567

Net income
Other comprehensive income

3,320-35,439

Comprehensive income

Total other comprehensive income

712,263

1,094,830

BreakdownComprehensive income attributable to owners of parent

712,263

1,094,830―9―

(3) Notes on Quarterly Consolidated Financial Statements(Notes on going concern assumptions)
Second quarter of FY3/23 (April 1, 2022 – September 30, 2022)
None applicable.
(Notes if there is a significant change in the amount of shareholders' equity)
Second quarter of FY3/23 (April 1, 2022 – September 30, 2022)
None applicable.
(Changes in accounting policies)(Application of guidelines for the application of accounting standard for fair value measurement, etc.)
Guidelines for the Application of the Accounting Standard for Fair Value Measurement (ASBJ Statement No. 31, June 17,
2021, hereinafter referred to as the "Guidelines for the Application of the Fair Value Measurement Accounting Standard") andother standards have been applied from the beginning of the first quarter of the current fiscal year. In accordance with thetransitional treatment stipulated in Article 27-2 of the Guidelines for the Application of the Fair Value Measurement
Accounting Standard, the new accounting policy stipulated by the Guidelines for the Application of the Fair Value
Measurement Accounting Standard will be applied in the future. The application of this standard has no effect on the quarterly
consolidated financial statement.

―10―