JP-HOLDINGS, INC.
Financial Results for the Fiscal Year ending March 2020

TSE 1 (2749)
https://www.jp-holdings.co.jp/

ＩＮＤＥＸ
１

Measures by the Company against COVID-19

２

FY3/20 Results

３

Status of Operating Facilities

４

Business Environment Surrounding the Company

５

FY3/21 Forecast

6

Medium-term Management Plan

7

Main Initiatives for FY3/21

8

APPEDIX
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

2

１

Measures by the Company against
COVID-19

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

3

Measures by the Company against COVID-19•Established the Headquarters for Measures against COVID-19 on February 19, 2020 toprevent the spread of the virus.
•Taking various measures with our priority being to secure the safety of the children under
our supervision, their parents, business partners and employees in cooperation with local
governments.
Efforts in Childcare Facilities
•

•
•
•
•
•

•
•

Measure temperature every morning: If an employee has atemperature of 37.5 degrees or higher or is feeling unwell, we do notallow him/her to come to work until 24 hours after the fever has
lowered and his/her symptoms have improved.
Wash hands, rinse out mouth, disinfect hands and wear masks
when coming to work
Enhance cleaning and disinfection of facilities
Frequently ventilate (about once every 30 minutes) and humidify
Request business partners to measure their temperature and towash hands and disinfect when entering our facilities
Request temperature measurement of children and their parents
in nursery schools every day: If a child or parent has atemperature of 37.5 degrees or higher or is feeling unwell, we ask
them to stay at home until 24 hours after their fever has lowered andtheir symptoms have improved.
Make requests for school clubs based on the guidance of local
governments
Ask children and their parents to disinfect, wash their hands,
rinse their mouths and wear masks before entering our facilities

Efforts in the Head
Office/Headquarters• Measure temperature every morning: If an employee has atemperature of 37.5 degrees or higher or is feeling unwell, we
do not allow him/her to come to work until 24 hours after the
fever has lowered and his/her symptoms have improved.
• Encourage staggered work hours and telecommuting• Setup alcohol-based sanitizer at the entrance to offices
to encourage disinfection and request the use of masks• Self-restraint on unnecessary and non-urgent patrols
and visits to childcare support facilities• Self-restraint on unnecessary and non-urgent meetingsand business trips with meetings held on the Internet
Recruitment Activities• Request job seekers to measure their temperature before
interviews• Hold some interviews on the Internet

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

4

Measures by the Company against COVID-19
The Group is providing thorough support in each nursery school, facility, headquarters andthe Head Office with our top priority always being to secure the safety of the children under
our supervision, their parents, business partners and employees.

Disinfection of Toys Used in Facilities

Disinfection of Nursery School Doors

Correspondence for Families Voluntarily Restraining
from Attending Nursery School

Information Transmission
at the Entrance to Facilities

Thorough Hand Disinfection and Temperature
Measurement at the Time of Leaving Children
under Our Supervision

Video Streaming for Families Voluntarily
Restraining from Attending Nursery School

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

5

2

FY3/20 Results

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

6

FY3/20 Results⚫
•

Net Sales (Change Compared to the Previous Term)
Revenue increased year-on-year due to the opening of new facilities, an increase in

Net Sales

the number of children accepted in existing facilities and an increase in subsidies

31,719 million yen

relating to treatment improvement.
⚫ Operating Income and Ordinary Income (Change Compared to the Previous Term)• Personnel expenses increased due to treatment improvement, repair expenses
increased to improve the environment of each facility, and subsidies relating to theaddition of rent fees fell. However, income increased year-on-year due to an increase in
non-operating income resulting from an increase in subsidies accompanying an
increase in dormitory users. This was in addition to an increase in net sales due to anincrease in the number of children accepted in existing facilities.

Previous term: +8.3%
Comparison with
forecast: -0.9%

Ordinary Income

2,003

million yen
Previous term: +4.3%
Comparison with
forecast: -12.9%⚫ Net Income Attributable to Owners of Parent (Change Compared to the Previous
Term)• We recorded an extraordinary loss of 315 million yen. This was as a result of theAnnual Dividend

impairment of fixed assets relating to facilities where the investment recovery period is3.90 yen

expected to be lengthy in childcare facilities and system impairment accompanying the

Payout ratio: 30.5%
Previous term: 3.70 yen
Forecast: 3.90 yen

introduction of a new attendance management system. Nevertheless, with an increase

Operating Income

1,538

million yen
Previous term: +0.5%
Comparison with
forecast: -15.1%

Net Income Attributableto Owners of Parent

1,122 million yen
Previous term: +4.8%
Comparison with
forecast: -7.4%

Opening of New
Facilities
Nursery schools: 10
School clubs: 2

in ordinary income, income increased year-on-year.
⚫ Earnings Forecast• Our nursery service remained solid due to the opening of new facilities and an increase in the number of children accepted. However, personnel
expenses increased due to treatment improvement, repair expenses increased to improve the environment in facilities, and subsidies relating to rent
addition decreased. In addition, it took time to ascertain and verify the market in terms of the development of new contents and test marketing in our
new business. Accordingly, net sales, operating income and ordinary income were below our earnings forecast.
• Net income attributable to owners of parent was below our earnings forecast. This was because we recorded an extraordinary loss of 315 million yen.
This was as a result of the impairment of fixed assets relating to facilities for which the investment recovery period is expected to be lengthy inchildcare facilities as well as a decrease in net income.
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

7

FY3/20 Financial Highlights
FY 3/20

FY3/19ActualForecast

Results

29,29832,00031,719

8.3%

-0.9%

Operating income (million yen)

1,531

1,811

1,538

0.5%

-15.1

Ordinary income (million yen)

1,920

2,300

2,003

4.3%

-12.9

Net income attributable to owners ofparent (million yen)

1,071

1,212

1,122

4.8%

-7.4

Net income per share (yen)

12.44

14.08

12.81

0.37

-1.27

Net assets per share (yen)102.23―110.17

7.94―

Shareholders’ equity ratio (%)

31.7

―

36.9

5.2

―

Dividends (yen)

3.70

3.90

3.90

0.20

±０

Dividend payout ratio (%)

29.7

27.7

30.4

0.7

2.7

Net sales (million yen)

Rate of Change Rate of Change
Compared to the Compared to thePrevious Term
Forecast(Rounded down to the nearest million yen. Rate of change is rounded off to the nearest first decimal point place.)
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

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FY3/20 Factors for Changes in Net Sales
Net sales

Increased by 8.3% due to the opening of new facilities and an increase in thenumber of children accepted in existing facilities.

866
1,430

29,298
Increase due
to opening of
new facilities
and transition
to licensed
facilities△63
Expiration ofcontract andclosure122
Increase due
to salaryimprovement

66

31,719OthersIncrease in thenumber ofchildren
accepted inexisting facilities

Net
sales

Net
sales

FY3/19FY3/20(Unit: million yen/ Rounded down to the nearest million yen. )Copyright©JP-HOLDINGS, INC. All Rights Reserved.

9

FY3/20 Factors for Changes in Operating Income
Operatingincome1,531

OperatingincomeSG&A expenses (e.g., personnel expenses, taxes and dues)
increased. However, operating income increased as gross profit
augmented due to an increase in the number of children accepted.

241

△234

Gross profit

SG&A

1,538

Increase in gross profit
due to an increase in
the number of children
accepted

Personnel
expenses, taxes
and dues, andmaintenance andrepair expenses
increased

OperatingincomeFY3/19FY3/20(Unit: million yen/ Rounded down to the nearest million yen. )Copyright©JP-HOLDINGS, INC. All Rights Reserved.

10

FY3/20 Factors for Changes in Ordinary Income
Ordinary
incomeOrdinary income increased as a result of an increase in operating
income and subsidies due to an increase in dormitory users as well
as a decrease in non-operating expenses.

67

1,920

8

8
Increase in operating
income due to anincrease in the numberof children accepted

Ordinary
incomeNon-operating income
Subsidies for dormitory
expenses
Up by 79 million yen
Guarantee fees andothersDown by 61 million yen

2,003

Down by 67 million yen

Non-operating
expensesDismantling
expenses, etc.
Down by 67
million yen

Ordinary
incomeFY3/20FY3/19(Unit: million yen/ Rounded down to the nearest million yen. )Copyright©JP-HOLDINGS, INC. All Rights Reserved.

11

FY3/20 Quarterly Results
Operating
IncomeNet Sales
35,00030,000Results:
29,298Results:
31,719

7,709

4Q
第4四半期

Third
第3四半期
3Q quarter

2Q
第2四半期

First quarter
第1四半期
1Q

1,600

7,927
7,311

Results:
1,538

15,000

573
863

7,179

600

499

5,000

7,099

7,741

0

168

52

(138)
0

(200)

FY3/19FY3/20200
0594

FY3/201,600

568Results:
1,071

1,000
800

408

400

Results:
1,122
273

491

333

600

345

377

200

400
187
(8)

0

236
(16)

139

FY3/19FY3/20

(200)

(200)

FY3/19

2,000

1,200

400

306

200

2,200

1,400

800

600
400

953

1,200

469
10,000

665

1,000

800

7,776

Results:
2,003

1,800

1,600
1,400

1,200
1,000

Results:
1,920

Net Income Attributable to
Owners of Parent

1,800

Results:
1,531

1,400
20,000

2,200
2,000

2,000
1,800

8,275
25,0002,200

Ordinary
IncomeFY3/19FY3/20(Unit: million yen)
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12

FY3/20 Profit and Loss Statement
FY3/19Amount(Million Yen)

Net sales

29,298

Cost of sales

25,119Gross profit

Year on Year
Comparison

FY3/20Component
Component
Component
AmountAmount
Ratio
Ratio
Ratio
(Million Yen)
(Million Yen)
(%)
(%)
(%)

100.0

31,719

100.0

2,420

8.3

85.7 27,29８

86.1

2,178

8.7

4,178

14.3

4,420

13.9

241

5.8

SG & A expenses

2,647

9.0

2,881

9.1

234

8.9

Operating income

1,531

5.2

1,538

4.9

7

0.5

Non-operating income

560

1.9

567

1.8

7

1.3

Non-operating expenses

170

0.6

102

0.3

-67

-39.8

Ordinary income

1,920

6.6

2,003

6.3

82

4.3

Net income attributable toowners of parent

1,071

3.7

1,122

3.5

51

4.8

(Unit: million yen/ Rounded down to the nearest million yen)
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

13

FY3/20 Financial Condition
Debt (short-term and long-term) repaid and shareholders equity ratio increased
Liabilities, Net Assets,
Shareholders Equity Ratio

Financial condition
End of March 2020*( ) = Difference with the end of March 2019

Liabilities

Liabilities
AssetsNet Assets

Equity Ratio (%)

19,304 million yen

16,486 million yen

26,112 million yen(-2,818 million yen)

16,486million yen
36.9

31.7

(-2,132 million yen)

Net assets
9,636 million yen

8,950 million yen

9,636 million yen

End-FY3/19

End-FY3/20(+685,000,000 yen)
End of Mar. 2019

End of Sep. 2019

Current assets

10,458

9,788

Fixed assets

17,796

16,334

Total assets

28,255

26,112Current
liabilities

7,880

5,920

Fixed liabilities

11,424

10,565

Total liabilities

19,304

16,486

Total net assets

8,950

9,636

Million yen

Cash and deposits
Accounts receivable
Construction in progress
Long-term loans receivable- 609 million yen- 81 million yen- 939 million yen-135 million yen

Short-term borrowings
Current portion of long-term debt
Income taxes payable
Long-term debt

-1,500 million yen-526 million yen-20 million yen-974 million yen

Retained earnings
Treasury stock

797 million yen- 25 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.)

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

14

FY3/20 Balance Sheet(Million yen)

Total current assets

End-FY3/19

End-FY3/20

Change10,458

9,788

-670

6,816
2,491

6,206
2,410

-609
-81

17,796

16,334-1,462

9,897
342
7,555

8,620
247
7,466

-1,277-95-89

Total assets

28,255

26,122-2,132

Total Current liabilities

7,880
1,500

5,920
0

-1,959-1,500

2,166

1,639

-526

11,424

10,565-858

10,454

9,479

-974

Total liabilities

19,304

16,486-2,818

Total net assets

8,950

9,636

685

Total liabilities and net assets

28,255

26,122-2,132

Cash and deposits
Accounts receivable - otherTotal fixed assets
Total tangible fixed assets
Total intangible fixed assets
Total Investments and other assets(Short-term borrowings)(Current portion of long-term loans
payable)Total fixed liabilities
Long-term loans payable(Rounded down to the nearest million yen)
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15

FY3/20 Statement of Cash Flows(Million yen)EY 3/19

EY 3/20

Change

1,829

2,320

491

1,810
703
108
-297

1,688
724
311
-37

-121
20
202
259

-14

17

32

-624

-760

-136

-940

418

1,359

-1,877

-865

1,011

1,475

-3,349-4,824(Repayments of long-term loans payable)

5,500-5,500-2,799100-1,600-2,201-5,4003,900
597

Net increase (decrease) in cash and cash equivalents

2,360

-609

-2,970Cash and cash equivalents at end of period

6,816

6,206

-609

Cash flows from operating activities(Income before income taxes and minority interests)(Depreciation and amortization)(Impairment loss)(Decrease (increase) in accounts receivable)(Increase (decrease) in accounts payable - other and accrued
expenses)(Income taxes (paid) refund)Cash flows from investing activities(Purchase of property, plant and equipment)

Cash flows from financing activities(Proceeds from short-term loans payable)(Repayments of short-term loans payable)(Rounded down to the nearest million yen)
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

16

3

Status of Operating Facilities

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17

Status of New Openings as of the end of March 2020
FY 3/20 New Openings
Nursery Schools
School Clubs ：
Total

10
2
12

* Withdrawal from Hoka GO→Club Onarimon and Koto
Kids Club Ichikame upon contract expiration on the last
day of March 2019.
* Private school club AEL Yushima closed on the last
day of March 2019.
* Asc Ikegami Nursery School (Tokyo licensed nurseryschool) became a licensed nursery school, and Asc
Toyotama 1-chome Nursery School A, B (small-scalenursery schools) were consolidated into a licensed
nursery school on April 1, 2019.
* Kawasaki Miyamaedaira Nursery School (public-private
management) transitioned to private management,
operated as Miyamaedaira Nursery School.

Tokyo:
Shiga:

8 licensed nursery schools

1 licensed nursery school・Asc Ogi Nursery School・Asc Yukigaya Nursery School
・Koto-ku Ojima No.5 Nursery School・Asc Kitashinnjyuku Nursery School・Asc Kamitakaido Nursery School・Asc Midori Nursery School・Asc Hoya Nursery School・Asc Fuchukatamach Nursery School・Asc Otsukyo Nursery School

1 small-scale nursery schools
・Shinjuku-ku Nursery Room Edogawa
Nursery School

Tokyo:
2 school clubs
・Wakuwaku Fukuro Hiroba/Akakita Hibari Club No.2
・Wakuwaku Akanishi Hiroba/Akabanedai-nishi Elementary School Club No.2

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

18

No. of facilities Operated as of the End of March 2020/
No. of Facilities Operated by Region

Operate 297 facilities as of the end of March 2020
Hokkaido

TohokuLicensed nurseryschools: 3

Licensed nurseryschools: 11

Kanto
Kinki
Licensed nurseryschools: 9

Kyushu・Okinawa
Licensed
nursery schools: 5
Company-led
nurseries: 2

Chubu

Lic. nursery schools: 146
Small-scale nurseryschools: 4
Non-lic. nursery schools:
20
School clubs: 69
Children’s houses: 5
Private school clubs: 4

Vietnam
Kindergarten:1

Licensed
nursery schools: 9
School clubs: 3
Children’s houses: 6

Nursery schools 209, School clubs 72, Children’s houses 11
Private school club 4, Kindergarten (Overseas Facility)1* Withdrawal from Hoka GO→Club Onarimon and Koto Kids Club Ichikame upon contract expiration on the last day of March 2019.
* Private school club AEL Yushima closed on the last day of March 2019.
* Asc Ikegami Nursery School (Tokyo licensed nursery school) became a licensed nursery school, and Asc Toyotama 1-chome Nursery School A, B
(small-scale nursery schools) were consolidated into a licensed nursery school on April 1, 2019.
* Kawasaki Miyamaedaira Nursery School (public-private management) transitioned to private management, operated as Miyamaedaira Nursery School.

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

19

Changes in the Number of Facilities Operated and the Number of Children
Accepted to Nursery Schools
FY3/10FY3/11

FY3/12

FY3/13

FY3/14

FY3/15

FY3/16

FY3/17

FY3/18

8

10

11

14

16

14

10

10

11

12

12

28

43

61

71

85

102

118

136

148

160

171

0
26
0

0
26
0

0
26
0

0
26
0

0
26
0

0
26
0

0
23
0

0
21
0

2
21
2

20

Company-led Nurseries

0240Non-licensed Municipality
Authorized

5

4

4

4

4

4

1

0

0

0

0

Non-licensed Othernon-licensed

0

0

0

0

0

0

4

3

3

3

4

Joint Establishment with
Amusement Facilities

1

0

0

0

0

0

0

0

0

0

0

26
6
0

37
9
0

39
7
0

40
8
0

43
8
0

46
8
0

55
10
0

63
12
4

0

0

0

0

0

0

0

72
11
5
1

72

0

71
12
5
1

98

129

148

163

182

200

224

251

272

289

297

Licensed Nursery Schools(Public-private management)
Licensed Nursery Schools(Private management)
Small-scale Nursery Schools
Tokyo Licensed Schools

School Clubs
Children's Houses
Private School Clubs
Overseas Facility

Total

FY3/19FY3/20

0
2

11
4
1

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

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

20

4

Business Environment
Surrounding the Company

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

21

Support to Prevent the Spread of COVID-19
 We have closed nursery schools, school clubs and children’s houses according to request fromlocal governments due to the declaration of a state of emergency on April 7, 2020.
(Current as of May 8, 2020)

List of Temporarily Closed Nursery Schools,
School Clubs and Children’s Houses
Local Governent

Tokyo

No. of Schools
Closed

自治体

Local Government

5

Koto
江東区

3

Koto

6

Shibuya
渋谷区

6

Setagaya

1

Chuo
中央区

2

Suginami

4

Chiyoda千代田区

2Sumida2

Nakano中野区

1Bunkyo文京区

6

Chiyoda

1

Chuo

2

Toshima4

Bunkyo1

Meguro

2

Komae

1

Nishi-Tokyo

4
2

Saitama Shiki

1

Tokyo
東京都

Chofu

調布市

14

Inagi
稲城市

1

Total school clubs
学童クラブ計自治体

Local Government

北区
Tokyo
東京都

Kita

Bunkyo文京区

Ichikawa

2

港区Minato

Urayasu

1

Mitaka三鷹市

Shin-Seto

1

Saitama
Sayama埼玉県
狭山市

Nagakute

1

Toyonaka

2

Minoh

1

Yao

1

Total nursery schools

45

Aichi

Osaka

愛知県
Aichi

Tsushima
津島市
Toyoake
豊明市

児童館計Total children’s houses

45 nursery schools, 35 school clubs and 8 children’shousesNo. ofClubs Closed
休室数

Adachi

Fuchu

Chiba

Temporarily Closed Nursery Schools, School Clubs and Children’s
Houses due to Requests by Local Governments from April 7, 202035
No. of Children’s
Houses Closed

休館数

1
1
1
1
1
1
2
8

Established a Headquarters for Measures against
COVID-19 to promote our response on February 19,
2020

Response by Each Facility
•
•
•
•
•
•
•
•

Measure temperature every morning
Wash hands, rinse out mouth, disinfect hands and wear masks
when coming to work
Enhance cleaning and disinfection of facilities
Frequently ventilate (about once every 30 minutes) and humidify
Request business partners to measure their temperature and towash hands and disinfect when entering our facilities
Request temperature measurement of children and their parents
in nursery schools every day
Make requests for school clubs based on the guidance of local
governments
Ask children and their parents to disinfect, wash their hands,
rinse their mouths and wear masks before entering our facilities*We are providing childcare only to those who have difficulty in looking after their children at home in the above
facilities because they are health professionals, police officers, firefighters or otherwise necessary to maintainthe functions of society according to requests from local governments.
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

22

Current Waiting List Situation
National Waiting List Map (April 1, 2019)

Hokkaido

The number of children on waiting lists as of Apr.
2019 is 16,772 (3,123 decrease YoY).
The problem of children on waiting lists remains
serious. This is especially so in the Tokyo
metropolitan area and prefectures where major
cities (e.g. ordinance-designated cities) are located.
(Refer to the map on the right.)

平成31年4月1日現在
Current
as of April 1 ,2019

Prefecture

No. of Children on
the waiting List
152

Aomori

0

Iwate

175

Miyagi

583

Akita

65

Yamagata

45

Fukushima

274

Ibaraki

345

Tochigi

52

Gunma

21

Saitama

1,208

神奈川県1,020
新潟県 3,690
Kanagawa
富山県 750
Niigata2
石川県
Toyama0
福井県
Ishikawa0
山梨県 10
Fukui
長野県
Yamanashi0
岐阜県 80NaganoGifu
2
静岡県
Shizuoka
愛知県 212Aichi
三重県 258Mie
滋賀県 109Shiga459
京都府 86
Kyoto
大阪府 589Osaka
兵庫県 1,569
Hyogo
奈良県 198
Nara
Chiba

Tokyo

No of Prefectures(都道府県数

Less than 100
100人未満100 or more but less than 500
100人以上500人未満
500 or more less than 1,000
500人以上1,000人未満
1,000 or more less than 3,000
1,000人以上3,000人未満
3,000 or more but less than 5,000
3,000人以上5,000人未満
5,000 or more
5,000人以上

(23)
(14)
(14)
( 1)
( 0)

(23)
(14)
(14)

54

Tottori0

Shimane0

Okayama

580

Hiroshima

128

Yamaguchi

40

Tokushima

73

Kagawa

182

Ehime

103

Kochi

35

Fukuoka

1,232

Saga

24

Nagasaki70(15)

Kumamoto

178

(11)

Oita

25

Miyazaki

43

Kagoshima

349

(10)

Source: Ministry of Health, Labour and Welfare’s Nursery School Situation Summary (April 1, 2019)

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

Wakayama

Okinawa

1,702

Total

16,77223

Changes in the External Environment(No. of Children on Waiting Lists & Capacity and Usage of Nursery Schools)


Although childcare needs and capacity do not match, the number of children on waiting lists is decreasing.

The capacity sufficiency rate is decreasing and it is expected that capacity will not be reached in the future
depending on the region.

(People)30,000

Nursery School Capacity and No. of
Users
Nursery School

No. of Children on Waiting Lists
Nationwide and Tokyo
Nation全国
wide

東京都
Tokyo

4,500
Capacity

No. of Users(Thousands of people)

26,081
25,00023,1674,000

Nursery school
保育所定員数
capacity

93.8%

23,553

No. of nursery school
保育所利用者数
users

93.1%

93.3%
92.8% 93.0%

19,8953,000
16,7722,500

people)

94.0%
93.3%

3,500

20,000Use Ratio

Capacity
95.0%(Thousands of
定員充足率
sufficiency rate

2,532
2,374

2,635
2,459

92.0%
2,888
2,801
2,735
2,680
2,614
91.0%
2,547

15,000

90.0%
2,000
89.0%

10,000
7,814

8,466

1,500

8,586
5,414

5,000

88.0%

1,000

87.0%

3,690

0
2015年

2016年

2017年

2018年

2019年

500

86.0%

0

85.0%
2015年

2016年

2017年

2018年

2019年

Source: Ministry of Health, Labour and Welfare’s “Summary of the Nursery School Related Situation”
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

24

Changes in the External Environment (Future Forecast of Nursery School Needs)

If we compare nursery school needs (number increased in the period) over five years from 2015 to 2020 and 2020 to 2025, the rate ofincrease will reduce, but there will be little change in demand (decreasing number of kindergartens).



Nursery school needs for 0 to 2 year old infants remain high in Tokyo where there are many children on waiting lists.

Tokyo (Birth High/Employment High Case)

Nationwide (Birth Medium/Employment High Case)■Nursery schools (0 to 2 years old) ■Nursery schools (3 to 5 years old) ■Kindergartens (3 to 5 years old)

356

177

Nursery schoolneeds: Increase by
90,000 children

Nursery school needs:
Increase by 400,000
children(Tens ofthousandsof children)

373

174

369

161

385

151

383

115

126

53

134

114

368

85

368

66

371

369

49

35

150

144
273

148

154

38.2

162

63

74

89

110

33.8

34.4

166
17.9

17.1

282

134

Nursery schoolneeds: Increase by
18,000 children

15

160

168

2000 2005 2010 2015 2019 2020 2025 2030 2035 2040
Forecast
ActualSource: The Japan Research Institute, Limited’s “Future Outlook for Childcare Needs and How to Respond” and the Child and Family Policy Bureau of the
Ministry of Health, Labour and Welfare’s “Summary of the Nursery School Related Situation (April 2019)”

43.0

42.9

42.7

42.7

12.7

10.9

9.4

8

14.6

14.6

14.7

18.8

20

※

15.5
12.4

148

43.0

16.8
17.1

233
123

Nursery schoolneeds: Increase by
69,000 children

45.9

31.6

158
136

387

(Tens of thousandsof children)

9.1

9.8

5.4

6.1

10.2
7

21.5
9.1

14

14.2

28.4

30.2

14.4

16

※

15.4

14.4

17.5

2000 2005 2010 2015 2019 2020 2025 2030 2035 2040
ActualForecast

Source: The Japan Research Institute, Limited’s “Future Outlook for Childcare Needs and How to Respond” and the Tokyo
Metropolitan Government Bureau of Social Welfare and Public Health’s “Childcare Service Situation in Tokyo”

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

25

Changes in the External Environment (No. of Childcare Facilities)
 The number of licensed nursery schools is increasing in Tokyo. However, that
number is decreasing across Japan. Licensed children’s schools and smallscale childcare businesses are increasing.
No. of Childcare Facilities by Facility (Nationwide)
Decrease

Increase

No. of Childcare Facilities by Facility (Tokyo)
Decrease(Unit: People)

2014

2015

2016

2017

2018

2019

Licensed nursery school

2,274,039

2,260,534

2,248,716

2,238,340

2,231,144

2,218,725

Licensed children’s school(kindergarten/nursery school
cooperation type)

45,953

184,873

273,454359,423440,147

520,647

Licensed children’s school(kindergarten type)11,69020,502

26,516

31,936

39,51046,326

Regional discretion type
licensed children’s school

2,278

2,715

3,197

3,210

3,214

Small-scale childcare
business

3,671

25,44541,26057,293Home-based childcare
business

5,732

4,285

4,404

Childcare business in offices

2,954

5,147

Residential visit-basedchildcare business

0

Nursery room

Other

Increase(Unit: People)

2014

2015

2016

2017

2018

2019

Licensed nursery school

202,008

213,259

225,334

239,709

254,484

269,627

Licensed children’s school

3,304

3,289

4,296

5,331

5,822

6,269

3,419

Tokyo Licensed
Nursery School

22,60821,616

20,402

19,16917,89016,21871,181

81,987

Small-scale childcare
business

676

2,943

4,496

6,132

7,338

7,619

4,256

3,951

3,875

Home-based childcare
business

2,394

1,847

1,945

1,902

1,669

1,640

6,270

8,734

11,235

12,946

Childcare business in offices

0

96

256

420

684

752

13

33

163

197

234

Residential visit-basedchildcare business

0

6

15

75

126

160

53,52746,22745,062

42,13750,016

49,603

Nursery room

2,989

3,746

4,162

3,946

4,121

4,963

81,281

77,64073,67070,50533,82532,281

Regular use childcare
business

932

711

799

955

1,285

1,201

20,28459,70386,354Company-led childcare
business

69

348

727

Company-led childcare
business
Kindergarten

1,557,000

1,402,000

1,339,000

1,271,000

1,207,000

1,146,000

Kindergarten

170,673

165,348

161,275

157,418

154,423

150,270

Total

4,038,125

4,029,381

4,061,582

4,107,281

4,151,123

4,202,397

Total

405,584

412,861

422,980

435,126

448,190

459,446

Source: The Ministry of Health, Labour and Welfare’s FY2018 to FY2019 Childcare Security Plan and FY2014 toFY2017 Children on Waiting List Resolution Acceleration Plan

Source: Tokyo Metropolitan Government Bureau of Social Welfare and Public Health’s “Childcare
Service Situation in Tokyo”

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

26

Current Nursery School Teacher Shortage Situation
 The ratio of job openings to job applicants for nursery school teachers is decreasing. However, there
is a continuing shortage of nursery school teachers across Japan. (National average as of February
2020: 3.63 times) The ratio of job openings to job applicants for nursery school teachers in Tokyo is decreasing – it was
6.96 times in December 2018 and 5.71 times in December 2019. Nevertheless, it remains extremely
difficult to carry out hiring activities in Tokyo with a ratio of 4.55 times even in February 2020.
8

Effective Opening to Application Ratio for Nursery School teachers(X)7
6

Nationwide

Dec:
5.71

Tokyo

●

5
Jan:
3.86

4

Feb:
4.55

●

Feb:
3.63

3

2
1
0
Source: Ministry of Health, Labour and Welfare Employment Security Bureau’s General job placements (Report on Employment Service)
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

27

Business Environment
Measures to Cope ｗｉｔｈ Current and Future Changes of Environment
The business environment has changed greatly due to the spread of COVID-19.
■Declining Birth Rate

■Children on Waiting Lists
Present to Future
・Demand of nursery is increasing because of
women’s participation in society and this issue
becomes serious
・In the future children on waiting lists will
decrease by countermeasures of government andmunicipal units, impact of declining birthrate■Change of Child-raising Style due
to Women’s Participation in Society
・Women’s participation is increasing every year
and even in rural areas dual income families are
increasing
・Fathers’ involvement (child-care leave) is
increasing■Measures of Government andMunicipal Units
・Various measures are promoted in advance toeliminate children on waiting lists
・Further salary increase for teachers・Free fees measures (Oct. 2019)

Measures to
Cope wit
Change ofEnvironment

Qualitative
Improvement ofChild-raising
Establish New
Child-raising
Business

・In spite of gov’t measures birth rate is
declining (under 900,000 babies) ・Combined with aging problem,
demographic difference between Tokyo
metropolitan area and rural area exists■Complex Environment
・The competitive environment is intensifying
together with measures to solve the problemof children on waiting lists (e.g., making
preschool education and childcare free)
implemented from October 2019.
・Seek to exit from homogenization■Problems of Child-raising BusinessMeasures to
Avoid
Impact from
Outside・Safe and secure responseCountermeasures against COVID-19
・Performance is impacted by number of children,
gov’t and municipal policies, regulation changes
such as declining birth rate, decreasing children on
waiting lists, change of subsidy etc.
・Shortage of nursery school teachers andintensifying competition to secure personnel

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

28

Medium- to Long-term Business Environment
Whereas JPHD’s Child-raising Business is achieving growth as various countermeasures are being promoted
by government and municipal units to eliminate the problem of children on waiting lists, challenges such as
shortages of nursery school teachers and the declining birthrate need to be addressed. It is possible that theenvironment will change significantly depending on the spread of COVID-19.

Ｓtrengths

Ｗ eaknesses■ Competitive advantages as a leading company in child-raising
support services• Track record and expertise of the Child-raising Business (sizecombined with reliability)• Approx. 20,000 children, and employment exceeding approx. 6,000
childcare workers■ Group-wide, comprehensive service structure• Centralized management of the Child-raising Business■ Safety and security• Framework offering safety and security free of serious accidents■ Programs of government and municipal units, and changes ingovernment policy• Effects of changes in programs and government policy on
subsidies• Effects of systemic changes with respect to operations subject tolicensing■ Chronic shortage of nursery school teachers• Chronic shortage of nursery school teachers caused by factors
such as the opening of new facilities to eliminate the problem ofchildren on waiting lists and increasing numbers of children
accepted to existing facilities

Ｔhreats

Ｏ pportunities■ Government and municipal units are promoting various
measures to eliminate the problem of children on waiting lists• Subsidies are increasing and the business environment is otherwise
conducive to opening new facilities■ Number of service users increasing due to introductions of freeearly childhood education and childcare beginning in October
2019• Increase in nursery users amid the likelihood of a higher percentageof women in the workforce due to free early childhood educationand childcare■ Changes in social environment due to the spread of COVID-19
・Changes in the childcare business (childcare services from a newperspective)■ Decreasing childcare demand in the future associated with Japan’s declining
birthrate• Guardians are able to be selective due to the declining birthrate■ Market entry from different industries, M&As
• Market entry from players in the education sector, M&As by players from thesame and different industries■ Changes in programs of government and municipal units and government
policy• Decrease in subsidies and systemic change

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

29

5

FY3/21 Forecast

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

30

FY3/21 Earnings Forecast Concept
Revised Medium-term Management Plan

(1) Impact of COVID-19•

The temporary closing of some nursery schools, school clubs and children’s houses will continue until the end of
May due to the spread of COVID-19.
• We do not anticipate an increase in the number of children accepted until July.
(2) Response to Changes in the Environment• We will reduce new facilities (from 15 to 4 schools (separately, one school from Tokyo licensed one to licensed
one) to qualitatively improve our childcare support services and profitability.
Revised Medium-term Management Plan

Medium-termManagement Plan
Unit: Millions of yen

Unit: Millions of yen

FY3/21(Initial Plan)

Net sales

35,000Ordinary income

2,700

Ordinary income rate
New facilities
Nursery schools
School clubs andchildren’s houses
Switch from Tokyo
Licensed Nursery School
to licensed nursery school

FY3/21(Revised Plan)

Net Sales

33,005-1,994

Ordinary income

2,153

-546

Ordinary income rate

6.5%

-1.2%

9

-11

Nursery schools

4-11School clubs andchildren’shouses5±0

Switch from Tokyo
Licensed Nursery School
to licensed nursery school

1

－

7.7%

20
15
5
－

Rate of Change with
the Initial Plan

New facilities(Rounded down to the nearest million yen. Rate of change is rounded off to the nearest first decimal point place.)
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

31

FY3/20 Forecast
FY3/20
ActualYear on Year
Comparison (%)

ChangeFY3/21 Forecast

Net sales (million yen)

31,71933,005

1,285

4.1%

Operating income (million yen)

1,538

1,577

39

2.5%

Ordinary income (million yen)

2,003

2,153

149

7.5%

Net income attributable to owners of parent (million
yen)

1,122

1,163

40

3.6%

Net income per share (yen)

12.81

13.30

0.49

－

Dividends (yen)

3.90

3.90

±０

－

Dividend payout ratio (%)

30.4

29.3

△1.1

－

△6

－

3

－

4
Expected opening of nursery school (school)10

Switch to licensed
nursery school: 1

Expected consignment of school clubs andchildren’s houses (facility)

2

5(Rounded down to the nearest million yen. Rate of change is rounded off to the nearest first decimal point place.)
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

32

Dividend Situation●Dividend Policy
The Company pays a performance-based dividend with a consolidated payout ratio ofaround 30% while securing the internal reserves necessary to develop business in the
future and strengthen our management structure. In this term, the Company will pay a
dividend of 3.90 yen – the same amount as in the previous term considering the impact of
COVID-19.

2.50 yen
Dividend
payout ratio
31.8%
FY3/173.50 yen

3.70

3.90 yen

3.90 yen

yen

Dividend
payout ratio
32.7%

Dividend
payout ratio
29.7%

Dividend
payout ratio
30.４%

Dividend
payout ratio
29.3%

FY3/18

FY3/19FY3/20(Planned)

FY3/21(Forecast)*The year-end dividend for FY3/20 will be the dividend per share if approval is obtained at the Company’s 28th
Ordinary General Meeting of Shareholders.

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

33

Status of New Openings as of FY3/21
No. of Facilities Operated
as of April 1, 2020
Nursery schools
213
School clubs
77
Children’s houses 11
Private school club 1*Asc Higashi-ojima Nursery School (Tokyo licensed
Kindergarten
nursery school) became a licensed nursery school.
*Obu Municipal Kyowahigashi Nursery School (public(Overseas Facility) 1
private management) transitioned to private management,
operated as Asc Kyowahigashi Nursery School.
Total：303

FY 3/20 New Openings
Nursery Schools
4
School Clubs
5
Total 9*Three private school clubs operated by Amenity Life Inc.
(LT Kids Tsurugamine, LT Kids Futamatagawa and Elfi
Kids Ryokuen-toshi) closed at the end of March 2020.

Tokyo:
4 licensed nursery schools
・Asc Senjyu Nursery School・Asc Toneri Ekimae Nursery School・Asc Oizumigakuen Nursery School・Asc Nerima 3-chome Nursery School

Tokyo:
5 school clubs
•
•
•
•
•

Wakuwaku Yanagida Hiroba/Yanagida Midori Club No. 2
Wakuwaku Yoniwa Hiroba/Yoniwa Elementary School Icho
Club No. 2
Chofu Municipal Jindaiji Children’s House & School Club
Mitaka Municipal Minamiura School Club Annex A
Mitaka Municipal Elementary School No. 4 School Club B

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

34

6

Medium-term Management Plan

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

35

Response in Light of Changes in the External EnvironmentQualitatively improve childcare support business and create new growth businesses in light of changes in the external environmentSpread of COVID-19 will have a major impact on business promotion.

Response andMeasures (Policies)

Changes in theExternal
Environment

Past to FY3/20

From FY3/21•

Increase in children on waiting lists•

Various measures taken to reduce the number of children on•

Promote and strengthen measures against infectious diseases•

Acceleration of the declining birthrate•

Reduction in children on waiting lists due to a rapid increase in facilities *Clear difference

waiting lists by the government and local governments
between regions and changes to the subsidy system•

Increase in the female employment rate•

Increase in the number of nursery schools (rapid increase)•

Free infant and childcare and an increase in the female employment rate•

Intensifying battle over securing nursery school teachers•

Further improvement in safety and security (against COVID-19)

Increase the opening of new childcare facilities•

Qualitative improvement in childcare support services*Focus on quantitative expansion•

Unique childcare management for homogenization•

Strengthen hiring of nursery school teachers•

Shift to improving the retention rate from strengthening the recruitment of personnel (labor•

Work on new businesses that will increase earnings•

shortage, systemization and work style reforms)•

Quantitative expansion

Build new growth businesses in light of the falling birthrate

Qualitative improvement and development
in new growth areas

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

36

Target Performance Indicators

Medium-termManagement
Targets

Long-termManagement Vision

Long-term Management Vision 2025：Fulfill Consolidated Sales 100 BYen

Aiming to become “the highest quality child-raising services
company in Japan”

FY3/25

Existing Business 50.0 billion yen
New Business10.0 billion yen
Business or Capital Alliance40.0 billion yen

Further improve quality of child raising services
Create new businesses, form alliances and partnerships with nursery
enterprises
Infrastructure development over three years from FY3/19 to FY3/21
Third Year (Final Year) of the Medium-term Management Plan
Net sales of 33,005 million yen and ordinary income of 2,153 million yen in
FY3/21(Medium-term Management Plan was revised in light of changes in the social environment)

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

37

Long-term Management Vision
The Second Founding Stage

Expand Business Scale
Grow as leading company ofchild-raising

Promote Growth
Strategy

Develop Infrastructure
targeting FY3/25 ending

Consolidated
Sales
100BYenFulfill Consolidated Sales 100BYen on FY3/25 ending
40BY

Business orCapitalAlliance

10BY

New
Business

33BY
31.7BY
29.2BY

50BY

26.7BY
22.7BY

Existing
Child-raising
Business

20.5BY
17.8BYFY3/15

FY3/16

FY3/17

FY3/18

FY3/19FY3/20FY3/21

Medium-termManagement Plan

FY3/22

FY3/23

FY3/24

FY3/25

Promote to Fulfill Sales 100BY

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

38

Medium- to Long-term Corporate Strategy
Priority Measures to Fulfill Management Vision

GrowthFurther Qualitative
Growth of Childraising

Expand Existing
Business[Medium-term Management Plan toestablish foundations for growth]• Expand the Child-raising Business• Further improve childcare quality• Promote work-style reforms• Develop and promote new businesses

Strengthen
Management
through Business
Structure Reforms

Promote and expand
growth strategy

Create New
Business Value

FY3/25

FY3/21
FY3/20FY3/19FY3/18

Steer towardbusiness growth[Changes in the Business Environment]• Respond to changes in the businessenvironment (business structure reform)• Impact from the spread of COVID-19(strengthened measures)[Promotion and expansion of
growth strategy]• Increase volume of Child-raising
Business and improve quality• Promote and expand new businesses• Actively promote capital and businessalliancesTime
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

39

Medium-term Management Plan
Review FY3/21 – the final year of the Medium-term Management Plan – in light of changes
in the business environment and the impact of COVID-19.
 Forecast (Consolidated）
Sales Revenue

Initial:
35BY

31.7
BY

Revised:
33BY

29.2
BY

317

292

26.78
267
BY

9.4%
up

EY 3/182018年…

4.1%
up

8.3%
up

EY 3/192019年…

19BY

2020年…
EY
3/20

 Priority measure

EY
3/21
2021年…
(Unit: million yen)

2018年
EY 3/18
3月期

4.3% upOrdinary
IncomeRate
Ordinary
6.3%
Income Rate
6.6%

2019年
EY 3/19
3月期

2020年
EY
3/20
3月期

New Facilities

7.5% up

20BY

21.4% up

15 BY

(New
Openings)

Initial:27BY
Revised:
21BY

Ordinary Income

Initial:20

Ordinary
Income Rate
6.5%

Revised:
9

2021年
EY
3/21
3月期

(Unit: million yen)

(Total)EY 3/18

EY 3/19

EY 3/20EY 3/21

Nursery Schools
School Clubs, Children’s Houses
Kindergarten (Overseas Facility)
Total(1) Formulate and implement an operating structure and measures that prioritize safety, security and health(2) Reform the awareness and behavior of employees by ensuring the permeation of childcare principles/policies and bolstering the educational
structure(3) Planned recruitment of nursery school teachers and appropriate deployment in existing facilities linked with the recruitment plan
(4) Build attractive workplace environments (strengthen recruitment activities, improve personnel education and retention rate, reform the personnel
system, and manage health)(5) Ensure thorough compliance and further strengthen corporate governance(6) Promote systemization and reform the business structure to promote the sophistication of the business management/revenue management
structure and the efficiency of management(7) Expand earnings base by developing and promoting new businesses(8) Synergy measures (business alliances and capital alliances) in the child-raising support and education industries
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

40

7

Main Initiatives for FY3/21

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

41

FY3/21 Management Policies
The following are four main management policies. We will
improve/strengthen our childcare support business, create new businesses
and provide support for further safety/security.

Childcare Support BusinessThorough Safety and Security

Create facilities chosen bycustomers by qualitatively
improving our childcare support
business (work style reformand personnel system)

Implement ongoing support
with our highest priority being
safety and security (eachfacility and head
office/headquarters)

Enhance corporate value
Promote the sophisticationof group management(structural reform)

New Businesses

Create and expand new
businesses by collecting
together our expertise built up
in childcare support

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

42

Main Management Measures in FY3/21
Management
policies

Long-term management vision: Aim for the highest quality childcare
support business in Japan

Mid-term management vision: Qualitatively improve our childcare
support business and create new growth businesses

Main management
measures

Work to support continuous growth and changes in the external environment
1

Strengthen support with our top priority being to securesafety and security

2

Qualitatively improve our childcare support
business

3

Develop and strengthen management
structure through structural reform

4

Create/promote new growth businesses and strengthen
external sales
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

Improve thestability andprofitability ofexisting
businesses

43Main management measures

Details of Main Initiatives in FY3/21
1

2

3

4

Strengthen
support with our
top priority being
to secure safety
and security
Qualitatively
improve ourchildcare support
business

Prevent the spread of COVID-19 and continue efforts taking into consideration
the safety of children, parents, business partners and employees
Review existing businesses through work style reform as far as possible

Resolve personnel issues (personnel system revision, recruitment and retention
rate, and appropriate deployment)
Promote work style reform to become an attractive company
Re-build and establish our childcare philosophy (structures, common
consciousness and penetration to all facilities)

Develop andstrengthen
management
structure throughstructural reform

Improve profitability of existing facilities: Improve profitability by increasing thenumber of children accepted (improve the operating rate)
Secure personnel and optimize personnel deployment in light of changes in theexternal environment
Promote systemization in light of the environment in which it is possible toconcentrate only on on-site work and optimization of work

Create/promote
new growthbusinesses andstrengthen
external sales

Perform external sales utilizing the expertise of the group (e.g., provision of lunch,educational programs and school opening equipment)
Promote new business development and external sales integrated with childcare
business and peripheral businesses
Cultivate and promote new business areas through cooperation andcollaboration with various companies

Strengthen management structure and verify organizational structure/headquarter function inlight of information transmission and penetration

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

44

FY3/20: (1) Building a Safe and Secure Structure
Prevent the spread of COVID-19
Respond to requests from the government/local
governments and support telecommuting
Increasing Risk of Operating Facilities(Nursery schools, school clubs and children’shouses)Increasing Risk from Commuting andTraveling(Head Office and Headquarters)

Temporary closure of facilities at the request of local
governments

Telecommuting and staggered working hours

Requests for parents to voluntary refrain from
attending facilities

Response using the Internet

Health maintenance and management of children andemployees
Commuting risks for children and employees

On-site support/Safety measures

Establish a Mental Support Consultation Desk foron-site employees

Build a structure that makes it possible to work inand operate facilities safely and with peace of mind

Review the operations of each facility as far as possible through efforts that give highest priority to
the safety of the children entrusted to us/employees and work style reform
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

45

FY3/20: (2) Qualitatively Improve our Childcare Support Business Establish the Group’s childcare philosophy. At the same time, develop an environment andmechanisms that allow employees to work with peace of mind (e.g., personnel system, personnel
education and career formation). This will lead to the building of an attractive company.
A corporate group in which employees feel most comfortable in working and work with pride

Work style reform and productivity improvement
Secure and develop
personnel(Linked to reduced
resignations)•••

Reform personnel
systemManage humanresources••

Develop theworkingenvironment••

Rebuild and ensure the penetration of our childcare
philosophy

Strengthen recruitment using theInternet – widen the recruitment
methods
Expand the training structure (by level)
Reform the system in line with the onsite and Headquarter occupational
structure*Identify issues with advance surveys
Talent management system
Job rotation and extraction of issues
with questionnaires
Develop the environment in eachfacility (structures and operations)Manage working hours and optimize
office hours (introduce a new system)•

Rebuild our philosophy according to the current situation in childcare sites
with the Childcare Committee (on-site and headquarters)➢ Penetrate to on-site by utilizing guidebooks

×Verify and examine our future childcare support
business•

Verify new ways of childcare in the future

Stimulate with teambuilding•

Promote cross-sectional operations beyond departments by uniting
mutual opinions and thoughts➢
Firmly promote new ideas, problem-solving abilities and improvement

Qualitatively improve childcare support services
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

46

【Supplementary Material】Reacruitment of Nursery School Teachers
FY3/16

Nursery School
Teacher
Non qualified

FY3/17

FY3/18

FY3/19FY3/21Joined on
Apr.1

FY3/20New
Graduates

178

１９7

247

276

248

Mid career
employment

219

２４１

327

325

269

New
Graduates

－

23

32

46

26

188
230
(Plan: 330)

9

* 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.
（人）

Trend of Employee Numbers in childrearing Business

7000(*Include employees of school clubs stuffs, nutritionists, etc. other than nursery school teachers)
子育て支援事業 社員■ Part-time workers
子育て支援事業 アルバイト

6000■ Employees
5000
4000
3000
2000
1000
0
FY3/0８

FY3/09FY3/10FY3/11

FY3/12

FY3/13

FY3/14

FY3/15

FY3/16

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

FY3/17

FY3/18

FY3/19FY3/2047

【Supplementary Material】Our Plan to Secure Nursery School Teachers Utilize national and municipal subsidy and continue to improve wages.
 From Nov 2017, additional measures were introduced ※Provided retroactively from Apr. 2017(1)Implemented salary increase by regions(Max 480 thousand ¥/y)(2)Newly invented salary by roles(Max 480 thousand ¥/y)(3)Salary increase for directors and chiefs of nurseries(300 thousand ¥/y) The annual income for nursery school teachers in 2019 was 4,018,000 yen in the
Company on average against the national average of 3,635,000 yen. This is 383,000
yen more compared to the national average.
(10,000 yen)

420
410
400
390
380
370
360
350
340
330
320
310
300
290
280

AVERAGE ANNUAL SALARY OF NURSERY SCHOOL TEACHERS
400.7

401.8

The Company’s average

National average

374.3
354.1

357.9

358.6

363.5

342.1
328.4

332.4
324.9

324.2

331.4

323.9

323.3

326.8

316.7

322.5
314.6

310.8

2010

2011

315.0

300.9

309.8

287.1

2008

2009

2012

2013

2014

2015

2016

2017

2018

2019

*As for national average, JPHD made numbers based on Ministry of Health, Labour and Welfare”Basic Survey on Wage Structure”「 Contractual cash earnings as of each June 」×12＋「 Annual special cash earnings of each previous year 」*JPHD’s average annual salary is based on full year base.

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

48

FY3/20: (3) Develop and strengthen Management Structure Through Structural Reform

Develop and strengthen management structure by developing business structures and mechanisms (systems andvarious schemes) to support those in light of changes in the market environment and growth strategies in the future

Promote structural reforms for continuous growth⚫ Structural Reform
Business/organization review and system reform promotion:(1) Optimize business/organization:

Review management functions of the Head Office and subsidiaries (Personnel
optimization and management function improvement)(2) Improve existing business:(Childcare support business)(3) Reform and improve operations:

Promote improvement measures for each facility based on area characteristics(capacity verification, redeployment of nursery school teachers and personnel optimization)

Promote personnel deployment optimization➢ Improve efficiency with system introduction➢ Input specialized personnel including new business fields⚫ Profit Increase and Improvement
Work to improve operational efficiency and reduce costs in facilities, Headquarters and the Head Office➢Thorough cost management (cross-sectional unified management among the whole company and all departments)
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

49

【Supplementary Material】Introducing Block System and its Effects
Nursery schools have been divided into five blocks in Japan to strengthen
operations and administrative functions for higher profitability.
Transmission of information

Centralization of supervisionand orders

Quickly identify and resolve
problems and issues(Management strategies,
successful business practices)

14

88

19

67

25

facil
ities

facil
ities

facil
ities

facil
ities

facil
ities

Block manager/Assistant
block manager/Support staff

Block manager/Assistant
block manager/Support staff

Block manager/Assistant
block manager/Support staff

Block manager/Assistant
block manager/Support staff

Block manager/Assistant
block manager/Support staff

Tokyo Block

Chiba/Saitama Block

Kanagawa BlockWest Japan Block

Hokkaido/Tohoku Block*As of April 1, 2020

Head office receives all information and monitors operations
Block Manager Meeting, Assistant Block Manager Meeting and Nursery School Principal Meeting

Examine new efforts

Collect on-site issues
Profit management of
individual facilities

Proper allocation of
personnel
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

Proper businessenvironment(Identify problems ⇒ Improvements and reforms)

50

FY3/20: (4) Create New Growth Businesses
 Proactively develop new businesses as the second pillar for our future growthstrategy in light of changes in the external environment
Current Situation

Product
development
and sales of
goods
business

Childcare support
programdevelopment andexternal sales• Develop peripheral products relating tochildcare support
Educational toys
Peripheral products related to childcare
Photographic products (data sales, photobook calendars and other derivative
products)• Make new efforts for existing programs(English, gymnastics and eurhythmics)- Gymnastics in English- After school gymnastics clubs

Development as New Business Pillars

Develop products/programs andstrengthen external sales

Link up with various companies

Develop B-to-C with electroniccommerce sites• Assistance in Childcare support (subsidy
system support)• Various training programs (e.g., safety andsecurity training)

Build member business, theindustry’s first platform• Develop new educational programs

Memberbusiness• Examine partner companies• Conduct test marketing with electroniccommerce businessExamine cooperation andcollaboration with companies

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

51

ESG Initiatives
ESG initiatives to achieve sustainable growth and improved
enterprise value
Parents
ChildrenEmployees

The highest quality child-raising
services company in Japan
Sustainable growth/confidence

Shareholders

Business
partners

E

S

G

Environment

SocialGovernance・Environmental pollution
・Global warming, etc.

・Improvements in working
environment
・Contribution to local societies, etc.

・Fair and transparent governancesystem・Internal control• Equipment for environmentally soundfacilities- LED lighting- Yukarela floor-wide radiant air coolingand heating system- Ecocarat material that reduces harmful
substances- Solaton ceiling materials with Eco Markcertification

・Work Style Reforms- Improvement in addressing issues affecting theworkplace environment upon establishing anadvisory committee- Improvement in salaries/benefits of on-site
employees• Helping facilitate women’s participation insociety in terms of addressing the issue ofchildcare facility waiting lists by opening
childcare facilities in respective regions• Three Outside Directors and four Outside
Audit and Supervisory Board Members
acting as independent officers• Harassment eradication declaration• Development of risk management
practices
・Compliance Committee
・Internal whistle-blowing system
・Compliance training

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

52

8

APPENDIX

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

53

Company Overview

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

54

Profile
Company Name

JP-HOLDINGS, INC.

Listed Market

First Section of the Tokyo Stock Exchange (Securities code: 2749)

Location
Date of
Establishment
CapitalHead Office: 17F Chikusa New Tower Bldg., 3-15-31 Aoi, Higashi-ku, Nagoya-shi Aichi
Tokyo Office: 5F Shinagawa Season Terrace, 1-2-70 Konan, Minato-ku Tokyo
March 31, 1993
1,603.955 million yen

Representative

Koichiro Furukawa, President and Representative Director

No. of Employees

Employees: 3,481 / Part-time workers: 2,520 *As of March.-end 2019Japan Nursery Service Inc. (Capital stock: 99 million yen / Wholly owned subsidiary)
J Kitchen Inc. (Capital stock: 10 million yen / Wholly owned subsidiary)
J Cast Inc. (Capital stock: 10.4 million yen / Wholly owned subsidiary)

Consolidated
Subsidiaries

J Planning Sale Inc. (Capital stock: 10 million yen / Wholly owned subsidiary)
Japan Nursery Institute for General Research Inc. (Capital stock: 10 million yen / Wholly owned
subsidiary)
Amenity Life Inc. (Capital stock: 70 million yen / Wholly owned subsidiary)

COHAS VIETNAM CO., LTD (Capital stock: 6,834,million VND / Wholly owned subsidiary）
Nursery Service (Japan Nursery Service, Amenity Life, and COHAS VIETNAM )Gymnastics, English and Eurhythmics Schools Contracting Service (J Cast)
Business Areas

Food Service (J Kitchen)
Distribution Service (J Planning Sale)
Researching , Training and Consulting Service (Japan Nursery Institute for General Research)
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

55

Corporate Philosophy
 Corporate Message
For the smiles of children…
Smiles of children: This is our pride that cannot be replaced. We always provide childcare
where children who will lead the future can develop generosity as well as words andemotions to express themselves in a safe environment.
We strive for continual self-improvement to be models to children. We also strive toconnect with children with passion and a sense of responsibility, and to acquire strong
ethical values and social conscience.

 Management Philosophy
1.Number one priority: Safety and security
2.Childcare that remains memorable forever to users
3.Provision of high-quality services needed by users

4.Creation of work-friendly environments
Copyright©JP-HOLDINGS, INC. All Rights Reserved.

56

Business Summary Operation of Childrearing Facilities (Public and Private)
Public Facilities = Subsidy from Gov’t and Municipalities
Licensed
Nursery School

Private Facilities= Subsidy from Gov’t
and Municipalities No

YesTokyo Licensed
Nursery School

School Club,Children's House

Municipality

Municipality

Private School Club

ParentMunicipality

ParentLicensed schools(Public-private management)

Licensed schools(Private management)

Revenue from User

Revenue from User

(Burden of Actual Cost)(Burden of Actual Cost)

Structureof SalesSubsidy（DesignatedManagement Fee）
※depends on municipality

Subsidy（Official Price）+（Addition by
Municipality）※depends on municipality

JP

Contract

ParentUsage FeeJP

ParentUsage FeeContract

Contract
Form

JP

JP

Revenue from User
Revenue from User
(Childcare Charge +Burden of Actual Cost)

Subsidy（Tokyo Met. Gov’t）+（Addition by
Municipality）(Burden of Actual Cost)

Subsidy（ DesignatedManagement Fee）
or
（Trustee Fee）

Revenue from
User
(Childcare Charge +Burden of Actual
Cost）※depends on municipality※depends on municipality

Copyright©JP-HOLDINGS,INC All Rights Reserved.

57

Comparison of Kindergartens, Nursery Schools and Licensed Children’s Schools
Kindergarten

Nursery School

Licensed Children’s School(Kindergarten/Nursery School
Cooperation type)Act on Child Education and Childcare Support (Defines the framework of cross-ministerial and unified payments in
the Cabinet Office)Section 3 of the School Education
Act(Under the jurisdiction of the
Ministry of Education, Culture,
Sports, Science and Technology)

Article 7 (1) of the Child Welfare Act(Under the jurisdiction of the Ministryof Health, Labour and Welfare)

Article 7 (1) of the Child Welfare
Act
Article 2 (7) of the Licensed
Children’s School Law(Under the jurisdiction of the
Ministry of Education, Culture,
Sports, Science and Technology &the Ministry of Health, Labour andWelfare)Type of Facility

SchoolChild welfare facility

School and child welfare facility

Target Children*

1st certification

2nd and 3rd certification

1st, 2nd and 3rd certification

Basis of Education
and Childcare
Content

Kindergarten Education Guidelines

Nursery School Childcare Guidelines

Licensed Children’s School
Education and Childcare Guidelines

8 hours as standard

Hours depending on the children (8hours for children requiring
childcare and 4 hours for children
requiring education) as standard

Underlying
Laws/Regulations

Daily Education andChildcare Time

4 hours as standard

Number of
Education and
Depending on the regional
39 weeks or more
No stipulations
conditions
Childcare Days in aYear
*1st certification: Children of 3 years old or older requiring education / 2nd certification: Children of 3 years old or older requiring childcare / 3rd certification:
Children under 3 years old requiring childcare
Copyright©JP-HOLDINGS,INC All Rights Reserved.

58

Overview of School Clubs and Children’s Houses
School Clubs (Broad Definition)
Children’s Houses

After-school Children’s Health
Promotion Business

After-school Children’s Classroom
Promotion Business

Underlying
Laws/Regulations

Article 6-3 (2) of the Child Welfare Act(Under the jurisdiction of the Ministry of
Health, Labour and Welfare)

Implementation of After-school Children’s
Plan Promotion Business(Under the jurisdiction of the Ministry of
Education, Culture, Sports, Science andTechnology)

Article 40 of the Child Welfare Act(Under the jurisdiction of the
Ministry of Health, Labour andWelfare)Nature of the Facility

The aim is to provide a place forappropriate fun and lifestyles for children
enrolled in elementary school whoseparents are not at home after school due
to work and foster them healthily byusing a facility such as child welfare
facilities after school.

This aims to establish safe and secure activity
bases (locations) for children using spareclassrooms in schools after hours or on theweekends. These provide opportunities forlearning and a variety of experiences/exchange
activities for children on a regular andcontinuous basis with the participation of local
residents.

This aims to offer healthy fun tochildren in the community, promote
their health and nurture emotions.
(one of children’s recreational
facilities)

Target Children

Grades 1 to 3 in elementary school(However, it is also possible to target
children in special support elementary
schools and elementary school children ingrades 4 and above)

All children in the community (regardless ofwhether infants, children or students andregardless of whether their parents work ornot)

All children under the age of 18

Basis of Education andChildcare Content

After-school Children’s Health
Promotion Business Action Guidelines
After-school Children’s Club Guidelines

After-school Children’s Classroom Promotion
Business Action Guidelines

Children’s House Guidelines

Daily Education andChildcare Time

3 hours or more on average(However, this is 8 hours or more as a
general rule on Saturdays, school
holidays and long-term holiday periods)

Number of Education
and Childcare Days ina Year250 days or more as a general rule
(However, this can be 200 days or more
depending on the form of the user’s
needs)

4 hours or less on average(However, this is 8 hours or less as a generalrule on Saturdays, school holidays and longterm holiday periods)

Set in accordance with thesituation in the community (e.g. theage of the target children andconvenience of parents)

Less than 250 days as a general rule

Copyright©JP-HOLDINGS,INC All Rights Reserved.

59

Group Business Overview (Composition of Internal/External Transactions)
JP-HOLDINGS, INC.

Internal/ExternalChildcare Support
Business
Business Support

Internal
Overseas
Business Support
External
New Nursery School
Opening Support
Childcare Support
Business
ConsultingChildcare Support Business
Nursery schools: 213
Children’s houses: 11
School clubs: 77
Private school clubs: 1

Amenity Life Inc.
Childcare support Business
Nursery schools: 5

Overseas Business
COHAS VIETNAM CO.,LTD

Childcare Support Business

J Kitchen Inc.
Catering Business(Lunch provisionand contracting)Consigned
service

J Cast Inc.
English, Gymnastics andEurhythmics(Teacher dispatch andclassrooms)

External
sales

J Planning Sale Inc.
Goods Sales
External(Childcare equipment sales
and graduation
photographs)

New Business
Development
Provision of expertise
Product and systemdevelopment

External companies

Consulting BusinessJapan Nursery Service Inc.

Provision of resources within the groupJapan Nursery Institutefor General Research
Inc.

Provision of resources within the group

Consulting on the opening of newnursery schools

External companies

Domestic Business

External
sales

Kindergarten: 1

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

60

Results Trends

Copyright©JP-HOLDINGS, INC. All Rights Reserved.

61

Consolidated Results (Highlights)
FY3/10 FY3/11 FY3/12 FY3/13 FY3/14 FY3/15 FY3/16 FY3/17 FY3/18 FY3/19 FY 3/20
Net sales(million yen)
Operating income(million yen)
Ordinary income(million yen)
Net income
attributable to ownersof parent(million yen)

8,194

Net income per share(Yen)

9,166 11,867 13,789 15,747 17,868 20,552 22,799

26,779 29,298 31,719

738

839

1,114

1,285

1,234

1,345

1,732

1,168

1,303

1,531

1,538

800

866

1,150

1,325

1,460

1,550

1,781

1,350

1,582

1,920

2,003

444

500

653

717

837

904

1,071

661

910

1,071

1,122

6.06

6.67

7.83

8.60

10.03

10.84

12.84

7.87

10.70

12.44

12.81

* Net income per share is the amount that reflects the stock split.
(million yen)(million yen)

35,0002500
Net sales(million yen)

30,000Operating income(million yen)

Ordinary income(million yen)
2000

25,0001500

20,00015,0001000

10,000
500
5,000
0

0
FY 3/9FY 3/10FY 3/11

FY 3/12FY 3/13

FY 3/14

FY 3/15FY 3/16

FY 3/17

Copyright©JP-HOLDINGS,INC All Rights Reserved.

FY 3/18

FY 3/19

FY 3/2062

Consolidated Results (Balance Sheet / Statement of Cash Flows)
FY3/10 FY3/11 FY3/12 FY3/13 FY3/14 FY3/15 FY3/16 FY3/17 FY3/18 FY3/19 FY3/20
Total assets(million yen)

5,763

9,432

9,808 10,876 13,521 18,882 21,126 24,002

25,761 28,255 26,122

Net assets(million yen)

1,903

3,559

3,977

4,452

5,034

5,606

6,279

6,854

7,756

8,950

9,636

Shareholders’ equity
ratio
(%)

32.9

37.7

40.5

40.9

37.2

29.7

29.7

28.5

30.1

31.7

36.9

FY3/10 FY3/11 FY3/12 FY3/13 FY3/14 FY3/15 FY3/16 FY3/17 FY3/18 FY3/19 FY3/20
Cash flows fromoperating activities(million yen)

1,878

1,865

1,829

2,320

- 906 - 1,808- 821 - 1,268 - 3,638 - 3,959 - 2,449 - 3,305- 1,292

- 940

418

Cash flows fromfinancing activities(million yen)

412

2,473

- 219

514

1,220

3,748

1,553

1,646

- 135

1,475

-3,349Year-end balance of
cash and cash
equivalents(million yen)

1,022

2,602

2,768

3,188

1,808

2,891

3,798

4,017

4,455

6,816

6,206

Cash flows frominvesting activities(million yen)

378

915

1,205

1,173

1,038

1,294

1,804

Copyright©JP-HOLDINGS,INC All Rights Reserved.

63

Dividends
The basic policy of our company is to continue paying a performance-linked dividend with a payout ratio of around
30% while maintaining the necessary internal reserves for future business development and to strengthen ourmanagement structure.

FY3/10 FY3/11 FY3/12 FY3/13 FY3/14 FY3/15 FY3/16 FY3/17 FY3/18 FY3/19 FY3/20

Amount ofdividend per
share
(yen)

2.00

Payout ratio
(%)

33.0

2.90

3.00

Commemor
ative
dividend:
0.50 yen

Commemor
ative
dividend:
0.50 yen

43.4

38.3

3.20

3.60

4.00

5.00

2.50

3.50

3.70

3.90

37.2

35.9

36.9

38.9

31.8

32.7

29.7

30.4

The amount of dividend per share reflects the stock split.

Copyright©JP-HOLDINGS,INC All Rights Reserved.

64

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.