Summary of Business Results for the First Quarter Ended June 30, 2020
[Japan GAAP] (Consolidated)
August 13, 2020
Company
JP-HOLDINGS, INC.
Stock Code2749
URL: https://www.jp-holdings. co.jp
Representative
Tohru Sakai, President and Representative Director
C o n t a c t
Ryoji Tsutsumi, Director
Expected date of filing of annual securities report: August 13, 2020
Preparation of supplementary financial document: None
Results briefing: None

Listed on the TSE 1
T E L: +81-52-933-5419
Expected starting date of dividend payment: -（Rounded down to million yen）

１. Consolidated business results for the three months ended June 2020
(April 1, 2020 through June 30, 2020)(1) Consolidated results of operations(% change from the previous corresponding period)

Net sales

Operating income

Million yen
7,835
7,741

Three months ended Jun. 2020Three months ended Jun. 2019
(Note) Comprehensive income

%
1.2
9.0

Million yen
93
52

Ordinary income

%
78.0
-

Million yen
267
187

%
42.5
-

Net income attributable toowners of parent

Million yen
177
139

%
27.1
-

Three months ended June 2020: 251 million yen (55.5%)
Three months ended June 2019: 161 million yen (-%)
Net income
Diluted net income perper share
share
Yen
Yen
2.03
Three months ended Jun. 2020
1.59
Three months ended Jun. 2019(2) Consolidated financial position
Total assets

Net assets

Million yen
27,634
26,122As of Jun. 30, 2020
As of Mar. 31, 2020

Million yen
9,546
9,636

Shareholders’ equity
ratio
%
34.5
36.9

(Reference) Shareholders’ equity
As of June 30, 2020: 9,546 million yen
As of March 31, 2020: 9,636 million yen

2. Dividends
End of 1Q
Yen-

Year ended Mar. 2020
Year ending Mar. 2021
Year ending Mar. 2021 (forecast)

Yen
0.00

Annual dividend
End of 3Q
Yen
-

0.00

-

End of 2Q

Year-end

Total
Yen
3.90

Yen
3.90

3.90

3.90

(Note) Revisions to dividend forecast for the current quarter: None

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

Net income attributable toowners of parent

Ordinary income

Net income
per share

Million yen%

Million yen%

Million yen%

Million yen%

Yen

33,005

4.1

1,577

2.5

2,153

7.5

1,163

3.6

13.30

(Note) Revisions to business forecast for the current quarter: None

*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 standards②Changes in accounting policies other than ①③Changes in accounting estimates④Restatement: None: None: None: None(4) Shares outstanding (common stock)①Number of shares outstanding at the end of period (treasury stock included)
As of June 30, 2020
87,849,400 shares
As of March 31, 2020
87,849,400 shares②Treasury stock at the end of period
As of June 30, 2020
380,707 shares
As of March 31, 2020
380,707 shares③Average number of stock during period (quarterly cumulative period)
Three months ended June 2020
87,468,693 shares
Three months ended June 201987,773,668 shares(Note) The number of treasury stock deducted for the calculation of the average number of stock during the fiscal year ended March
2020 includes the company's shares held by Trust & Custody Services Bank, Ltd. as trust property of "Stock Benefit Trust(Employee Stock Ownership Plan)"*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 thatform 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 3).

○ Table of Contents of the Appendix
1. Qualitative Information on Quarterly Financial Results…………………………………………. 2(1) Results of Operations…………………………………………………………………………. 2(2) Financial Position……………………………………………………………………………... 3(3) Consolidated Earnings Forecasts……………………………………………………………… 3
2. Quarterly Consolidated Financial Statements…………………………………………………….. 4(1) Quarterly Consolidated Balance Sheets……………………………………………………….. 4(2) Quarterly Consolidated Statements of Income and Statements of Comprehensive Income…... 6(3) Notes on Quarterly Consolidated Financial Statements……………………………………….. 8(Notes on going concern assumption)…………………………………………………………….8(Notes if there is a significant change in the amount of shareholders' equity)……………………8―1―

1. Qualitative Information on Quarterly Financial Results(1) Results of Operations
In the first quarter of the current fiscal year, the Japanese economy was seriously affected by the spread of new coronavirus (COVID19) infectious on a global scale, and the situation in employment, economy, and social life has remained extremely severe. In responseto the State of Emergency declared by the government on April 7, 2020, corporate activities and consumer spending have shrunk
dramatically, and the situation remains uncertain even after the declaration was lifted.
In regard to the child-raising service business, the number of dual-income households is increasing as more women are entering theworkforce due to changes in women's awareness of social participation and the promotion of women's active participation in theworkforce by the government. Demand for childcare continues to be high due to free child education and childcare introduced from
October last year. However, following the State of Emergency by the central government on April 7, 2,020, and the request to refrainfrom going out and to regulate sales activities to prevent the spread of COVID-19, some facilities (nursery schools, school clubs,
children's houses) in the areas where we operate child-raising facilities are temporarily closed until the end of May at the request of
the local governments. Since then, the Company has been operating facilities under severe conditions while ensuring safety.
Under these severe situations, the Company established a COVID-19 Control Headquarters as measures against COVID-19 infections.
While coordinating with local governments, the Company gives top priority to ensuring the safety of children as well as the safety ofparents, business partners and employees. Each facility establishes its own strict safety standards. These include body temperature
measurement every morning, hand washing, gargling and alcohol disinfection, as well as wearing masks. The head office and Tokyo
Headquarters have introduced flexible work hours and telework systems to ensure quick response.
In order to further improve the quality of child- raising service, the Company has made efforts to reduce turnover by strengthening
human resource development, enhancing the capabilities required for every job category and every grades of kids, introducing a humanresource management system and creating a comfortable working environment. Furthermore, the Company is working to improve
profitability and operational efficiency by optimizing enrollment levels and staff assignments at existing facilities, while promoting
initiatives to reduce operational and indirect costs by introducing new systems and reviewing operations.
As for the new facility openings, the Group has opened a total of 9 facilities during the first quarter of the current fiscal year according
to the plan, including 4 nursery schools (4 in Tokyo) and 5 school clubs (5 in Tokyo).
(Nursery school)
Asc Senju Nursery School(Apr. 1, 2020)

Asc Toneri Ekimae Nursery School(Apr. 1, 2020)

Asc Oizumi Gakuen Nursery School(Apr. 1, 2020)

Asc Nerima 3-chome Nursery School(Apr. 1, 2020)(School clubs)
Wakuwaku Yanagida Hiroba/Yanagida Midori Club No. 2(Apr. 1, 2020)

Wakuwaku Yon-iwa Hiroba/Yon-iwa Elementary School Icho Club No. 2(Apr. 1, 2020)

Chofu City Jindaiji Children’s House School Club

(Apr. 1, 2020)

Mitaka City Minamiura School Club A(Apr. 1, 2020)

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

As a result, the Group came to have 213 nursery schools, 77 school clubs, 11 children's houses, 1 private school club, and 1
kindergarten (overseas facility), making a total of 303 facilities for supporting child-raising at the end of June 2020.
―2―

In addition, following the resolution at the 28th Ordinary General Meeting of Shareholders held on June 25, 2020, the Company
has made a new management system with a majority of outside directors who are experts with deep knowledge and knowledge foreducation, finance, legal affairs and governance. The Group long considered the strengthening of corporate governance to be an
important initiative to ensure transparency, fairness, and prompt and decisive decision-making. To further strengthen the structure,
the Company has shifted from a Company with Auditors to a Company with an Audit and Supervisory Committee. By further
strengthening the audit and supervisory functions of the Board of Directors and realizing speedy decision-making, the Company
aims to further strengthen corporate governance and increase corporate value through sustainable growth.
As a result, the Group’s consolidated net sales were 7,835 million yen (up 1.2% year on year), operating income was 93 million
yen (up 78.0% year on year), ordinary income was 267 million yen (up 42.5% year on year), and net income attributable to ownersof parent was 177 million yen (up 27.1% year on year).
The major factors are as follows:
Net sales increased year on year due to the opening of new facilities, the transition from Tokyo licensed nursery school to licensed
nursery school, and an increase in the number of children admitted to existing facilities, despite a decrease in school lunch fees andrevenues from merchandise sales associated with the sale of photographs collected directly from parents, due to the temporalclosure of some facilities until the end of May following the State of Emergency on April 7, 2020 to prevent the spread of COVID19.
Operating income increased year on year owing to an increase in gross profit and a reduction in selling, general and administrative
expenses as a result of efforts to reduce foodstuff costs and other expenses related to school lunches due to the temporal closure ofsome facilities at the request of local governments, in addition to the above-mentioned factors that contributed to the increase in
net sales, despite a decrease in sales associated with the prevention of the spread of COVID-19.
Both ordinary income and net income attributable to owners of parent increased year on year thanks to an increase in operating
income and increased subsidies associated with an increase in users of the corporate dormitory.

(2) Financial Position
As for the financial position at the end of the first quarter of the current fiscal year, the total assets amounted to 27,634 million yen(up 1,512 million yen from the end of the previous fiscal year).
Current assets totaled 11,936 million yen (up 2,148 million yen), mainly reflecting an increase of 2,903 million yen in cash anddeposits, while there were decreases of 529 million yen in accounts receivable, 125 million yen in others, and 84 million yen in
inventories.
Fixed assets totaled 15,698 million yen (down 636 million yen). This was mainly due to an increase of 98 million yen in investments
and other assets, while there were decreases of 497 million yen in construction in progress, 96 million yen in buildings and structures,
54 million yen in long-term loans receivable, and 37 million yen in deferred tax assets.
Total liabilities amounted to 18,088 million yen (up 1,601 million yen from the end of the previous fiscal year).
Current liabilities totaled 6,190 million yen (up 269 million yen), mainly due to increases of 513 million yen in others, 291 million
yen in accounts payable, and 248 million yen in long-term loans payable, while there were decreases of 389 million yen in provision
for bonuses, 326 million yen in income taxes payable, and 33 million yen in accrued consumption taxes.
Fixed liabilities totaled 11,897 million yen (up 1,332 million yen). This was mainly due to an increase of 1,309 million yen in longterm loans payable.
Total net assets as of the end of the first quarter of the current fiscal year totaled 9,546 million yen (down 89 million yen), mainly
due to an increase of 62 million yen in valuation difference on available-for-sale securities and a decrease of 163 million yen inretained earnings.

(3) Consolidated Earnings Forecasts
The full-year consolidated earnings forecasts have not been revised from the announcement on May 13, 2020, but actual results may
be different from the forecast according to the changes in business situations, etc. If there are any changes, 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.

―3―2. [Quarterly Consolidated Financial Statements](1) [Quarterly consolidated balance sheets](Thousand yen)Previous Fiscal Year
(March 31, 2020)

Current First Quarter(June 30, 2020)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade

6,206,487
76,2889,110,181
60,045Inventories
Accounts receivable - other111,259
2,410,895

27,088
1,881,180

Other
Allowance for doubtful accounts

1,009,077-25,759

883,827-25,787

Total current assets

9,788,250

11,936,535

12,237,506

12,251,140

Accumulated depreciation and impairment-5,349,352-5,459,227

Buildings and structures, net

6,888,153

6,791,912

Fixed assets
Tangible fixed assets
Buildings and structures

Machinery, equipment and vehicles

5,637

5,637

Accumulated depreciation-4,146-4,380Machinery, equipment and vehicles, net

1,490

1,256

923,279

938,003

Accumulated depreciation and impairment-671,412-689,345

Tools, furniture and fixtures, net

Tools, furniture and fixtures

251,866

248,658

Land
Construction in progress

980,894
497,896

980,894
776

Total tangible fixed assets

8,620,302

8,023,498

197,508

189,912Intangible fixed assets
Goodwill
Other

50,16948,853

Total intangible assets

247,678

238,765

Investment securities
Long-term loans receivable

436,234
3,284,007

534,779
3,229,696

Guarantee deposits
Deferred tax assets

1,906,120
1,128,962

1,903,728
1,091,413

Other
Allowance for doubtful accounts

720,593-9,445685,903-9,345

Total investments and other assets

7,466,474

7,436,176

16,334,455

15,698,440

26,122,705

27,634,976

Investments and other assets

Total fixed assets
Total assets―4―

(Thousand yen)Previous Fiscal Year
(March 31, 2020)

Current First Quarter(June 30, 2020)

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

195,720
1,639,460

171,554
1,888,301

Accounts payable – other
Income taxes payable

1,535,400
415,324

1,827,165
88,457

Accrued consumption taxes
Reserve for bonuses

117,626
554,836

84,290165,532

Asset retirement obligation
Other

10,894
1,451,683

1,965,221

Total current liabilities

5,920,945

6,190,521

9,479,911
757,052

10,789,320
780,304

320,567
7,979

321,325
6,972

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

10,565,510

11,897,922

16,486,455

18,088,444

Shareholders’ equity
Capital1,603,955

1,603,955

Capital surplus
Retained earnings

1,449,544
6,982,526

1,449,544
6,818,687

Total liabilities
Net assets

Treasury stock-107,515-107,515

Total shareholders’ equity

9,928,510

9,764,671

Accumulated other comprehensive income
Valuation difference on available-for- salesecurities
Deferred gains or losses on ledges-224,438-161,630-5,537-4,838Foreign currency translation adjustments
Remeasurements of defined benefit plans

2,610-64,895

5,067-56,737

Total accumulated other comprehensive income-292,261-218,139

Total net assets
Total liabilities and net assets―5―9,636,249

9,546,531

26,122,705

27,634,976

(2) [Quarterly Consolidated Statements of Income and Statements of Comprehensive Income][Quarterly Consolidated Statement of Income][First Quarter of FY3/21]

Net sales
Cost of sales

Previous First Quarter(Apr. 1, 2019
- June 30, 2019)
7,741,378
7,002,043(Thousand yen)
Current First Quarter(Apr. 1, 2020
- June 30, 2020)
7,835,179
6,963,492

Gross profit

739,334

871,686

Selling, general and administrative expenses

686,887

778,349

Operating income

52,447

93,336

Non-operating income
Interest income

25,796

21,795120,534
5,467

169,413-

Subsidy income
Guarantee commission received
Other

3,813

2,655

155,612

193,864

Interest expenses
Exchange loss

14,779-14,1394,486

Demobilization costs
Other

954
4,745

1,331

Total non-operating revenues
Non-operating expenses

Total non-operating expenses

20,47919,957

187,580

267,243

Loss on retirement of fixed assets

1,138

0

Total extraordinary loss

1,138

0

Income before income taxes and others

186,441

267,243

Corporate, inhabitant and enterprise taxes
Income taxes-deferred

41,983
5,018

84,686
5,269

Total income tax

47,001

89,955

Net income

139,440

177,288

Net income attributable to owners of parent

139,440

177,288

Ordinary income
Extraordinary loss

―6―

[Quarterly Consolidated Statement of Comprehensive Income][First Quarter of FY3/21]
Previous First Quarter(Apr. 1, 2019
- June 30, 2019)
139,440(Thousand yen)
Current First Quarter(Apr. 1, 2020
- June 30, 2020)
177,288

Valuation difference on available-for- sale securities
Deferred gains or losses on hedges

14,481-2,34562,807699

Foreign currency translation adjustment
Remeasurements of defined benefit plans

3,010
7,074

2,457
8,158

Total other comprehensive income

22,221

74,121

161,661

251,410

161,661

251,410--Net income
Other comprehensive income

Comprehensive income
BreakdownComprehensive income attributable to owners of parent
Comprehensive income attributable to owners of noncontrolling shareholders―7―

(3) Notes on Quarterly Consolidated Financial Statements(Notes on going concern assumptions)First quarter of FY3/21 (April 1, 2020 – June 30, 2020)
Not applicable(Notes on significant changes in shareholders' equity)
First quarter of FY3/21 (April 1, 2020 – June 30, 2020)
Not applicable―8―