Summary of Business Results for the Fiscal Year Ended March 31, 2022
[Japan GAAP] (Consolidated)
May 12, 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 annual shareholders’ meeting: June 28, 2022
Expected starting date of dividend payment: June 29, 2022
Expected date of filing of annual securities report: June 29, 2022
Preparation of supplementary financial document: Yes
Results briefing: Yes (for media members, institutional investors, analysts)（Rounded down to million yen）

1. Consolidated business results for the fiscal year ended March 2022
(April 1, 2021 through March 31, 2022)(1) Consolidated results of operations(% change from the previous corresponding period)
Net sales

Operating income

Million yen% Million yen
Year ended Mar. 2022
34,373
2.6
3,344
Year ended Mar. 2021
33,5004.1
2,857(Note) Comprehensive income:Year ended March 2022: 2,308 million yen (224.0%)
Year ended March 2021: 712 million yen (-31.3%)

Ordinary income
%
17.1
43.6

Million yen
3,358
2,947

%
13.9
47.1

Net income attributable toowners of parent

Million yen
2,279
537

%
324.1
-52.1

Ratio of ordinary
Ratio of operating
income to total
income to net sales
assets
Yen
Yen
%
%
%
Year ended Mar. 2022
26.06
20.7
10.5
9.7
Year ended Mar. 2021
6.15
5.5
10.6
8.5
(Note) In the fiscal year under review, the Company changed the presentation of "subsidy income" related to the childcare business, which waspreviously included in non-operating income, to "net sales." As a result of this change, major management indices for the previous fiscal
year are based on the indices after this reclassification
Net income
per share

Diluted net income
per share

Return on
equity(2) Consolidated financial position
Total assets

Net assets

Million yen
As of Mar. 31, 2022
34,274As of Mar. 31, 2021
29,740(Reference) Shareholders’ equity:
As of March 31, 2022: 11,975 million yen
As of March 31, 2021: 10,007 million yen

Shareholders’ equity
ratio

Million yen
11,975
10,007

Net assets per
share

%
34.9
33.7

Yen
136.91114.42(3) Consolidated results of cash flows

Year ended Mar. 2022
Year ended Mar. 2021

Cash flows fromoperating activities
Million yen
3,884
2,469

Cash flows frominvesting activities
Million yen
413
190

Cash flows fromfinancing activities
Million yen
1,978
2,155

Cash and cash equivalents
at the end of period
Million yen
17,296
11,0202. Dividends
Annual dividend
End of
1Q

End of2Q

End of3Q

Year-end

Yen
Yen
Yen
Year ended Mar. 2021
0.00
Year ended Mar. 2022
0.00
Year ending Mar. 2023
0.00
(forecast)
Breakdown of year-end dividend for the fiscal year ending March 2023
Ordinary dividend: 5.00 yen, Commemorative dividend: 1.00 yen

Total

Yen
3.90
4.50

Yen
3.90
4.50

6.00

6.00

Total
dividend(Total)Million yen
341
393

Dividend
payout ratio(Consolidated)
%
63.4
17.3
22.6

Rate of total
dividend to
net assets(Consolidated)
%
3.5
3.6

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

Operating income

Million yen

Year ending Mar. 2023

35,640Net income attributableto owners of parent

Ordinary income%

Million yen

%

3.7

3,560

6.4

Million yen

3,580

Net income
per share%

Million yen

%

Yen

6.6

2,325

2.0

26.58

*Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries accompanying changes
in the scope of consolidation): None
(2) Changes in accounting policies, accounting estimates and restatement①Changes in accounting policies associated with revision of accounting standards:②Changes in accounting policies other than ①③Changes in accounting estimates④Restatement: Yes: None: None: None(3) Shares outstanding (common stock)① Number of shares outstanding at the end of period (treasury stock included)
As of March 31, 2022
87,849,400 shares
As of March 31, 2021
87,849,400 shares② Treasury stock at the end of period:
As of March 31, 2022
380,707 shares
As of March 31, 2021
380,707 shares③ Average number of stock during period
Year ended March 31, 2022
87,468,693 sharesYear ended March 31, 2021
87,468,693 shares(Reference) Summary of non-consolidated business results
1. Non-consolidated business results for the fiscal year ended March 2022
(April 1, 2021 through March 31, 2022)(1) Non-consolidated results of operations(% change from the previous corresponding period)
Year ended Mar. 2022
Year ended Mar. 2021

Net sales
Million yen
3,066
2,570

%
19.3
8.9

Operating income
Million yen
%
1,396
57.4
886
42.9

Yen
15.30
1.55

Diluted net income per
share
Yen
-

Net income
per share
Year ended Mar. 2022
Year ended Mar. 2021

Ordinary income
Million yen
%
1,523
46.9
1,037
14.6

Net income
Million yen
%
1,338
887.5
135
-81.6

Shareholders’ equity
ratio

Net assets per
share(2) Non-consolidated financial position
Total assets
Million yen
As of Mar. 31, 2022
23,124As of Mar. 31, 2021
19,496(Reference) Shareholders’ equity:
As of March 31, 2022: 6,166 million yen
As of March 31, 2021: 5,129 million yen

Net assets
Million yen
6,166
5,129

%
26.7
26.3

Yen
70.50
58.65

* Financial summary is not subject to auditing procedures by certified public accountants or auditing firms.
* Explanation regarding appropriate use of business forecasts and other special instructions
・Forecasts regarding future performance in this material are based on information currently available to the Company and certain assumptions that thecompany deems to be reasonable at the time this report was prepared. Actual results may differ significantly from the forecasts due to various factors.
For information regarding the business forecasts, etc., please refer to “1. Summary of Operating Results (4) Future outlook” (Page 5).
・On Wednesday, May 20, 2022, the Company plans to hold results briefing for media members, institutional investors and analysts via a webcast. The
Company has suspended its results briefing for individual investors in order to prevent the spread of new coronavirus (COVID-19) infections.

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

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1. Summary of Operating Results(1) Summary of operating results for the current fiscal year
During the fiscal year under review, the Japanese economy showed some movement toward normalization of economic and social
activities against the backdrop of global economic recovery and the relaxation of various restrictions due to progress invaccination, despite the continuing stagnation of economic activities reflecting the impact of COVID-19. Nevertheless, the outlook
remains uncertain due to a combination of geopolitical risks associated with the growing pressure on the situation in Ukraine, in
addition to the re-expansion of infections due to new variant stocks, and concerns over an economic slowdown and a slowdown incorporate performance due to soaring resource prices.
Meanwhile, in the child-raising support business, the environment surrounding childcare is rapidly changing. These factors include
the acceleration of the declining birth rate society due to the sharp decrease in birth rate, the decrease in the number of children on
waiting lists because of people refraining from using the facilities due to COVID-19, a continuing shortage of childcare workers,
rising demand for childcare reflecting an increase in the female employment rate, and the need to respond to changes in working
styles and lifestyles due to the expansion of COVID-19.
The government has been promoting 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 "New Comprehensive Plan for After-school Children" in order to eliminate the waiting list for children. In
addition, the bill for establishment of the Children's Agency was approved by the Cabinet. The government plans to establish the
Agency in April next year and is promoting to create a better environment for childcare. In such circumstances, the social role ofthe 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 such as staggered work
hours and remote working at the head office and Tokyo headquarters.
In addition, in order to further improve the quality of child-raising support services and expand the scope of our business, we arecapturing changes in the social environment and have set three priority goals of "improve profitability and efficiency," "improvesoundness," and "improve growth potential." By effectively allocating and investing management resources, we have built a solidmanagement foundation. Specifically, with digital transformation (DX) as the pillar of reform to promptly respond to changes inthe social environment, in terms of "improve profitability and efficiency," we took these initiatives to promote operational
efficiency and improvements and reforms at our facilities: improve early learning programs to increase the number of children
accepted at existing childcare support facilities as our existing business, developing and introducing new content, the introductionof online learning programs (English, gymnastics, eurhythmics, and dance) and online facility tours ahead of other companies,
developing online international exchange programs with overseas child care facilities, etc., improve profitability by further
optimizing staffing.
In terms of "improve soundness," as the key of childcare support is "human resources," we have been working to establish a new
personnel system, expand our human resource education and training systems and improve operational efficiency throughsystemization.
As for the "improve growth potential," we introduced a new early learning program "Mojikazu Land" through a business alliancewith GAKKEN HOLDINGS CO., LTD., and worked to reduce costs and improve on-site operations through joint purchasing, as
well as to develop services that provide added value. Through these efforts, we will differentiate ourselves from our competitors
and promote the slogan of “create facilities that would be selected by customers”.
Furthermore, we are focusing on developing new businesses to create new value. We have launched "codomel," a childcare support
platform for children at more than 300 childcare support facilities nationwide (nursery schools, school clubs, and children’shouses) and their parents, and other people raising children, to provide a wide range of products and services related to childcare
during infancy, childhood, and school age. As the first service, we launched the “Childcare Product Matching Service,” which aims
to balance childcare support with effective use of resources and environmental preservation (SDGs), while increasing the numberof members of this service.
Based on our Group's management philosophy of "Through childcare support, we will contribute in creating smiles for everyone,"we will thoroughly make effective use of resources by promoting the reuse and recycling of childcare products, and promote thisinitiative, which takes into consideration the conservation of the global environment, including the reduction of environmental
impact and treatment costs. We are promoting this initiative as a new pillar outside of our existing businesses. In the future, we will
expand this business overseas and further expand its services and content.
As for the new facility openings, the Group has opened a total of 11 facilities during the fiscal year ended March 2022 according to
the plan, including 3 nursery schools (3 in Tokyo) and 8 school clubs and children's houses (8 in Tokyo).

2

(Nursery school)
Asc Kami-Shakujii Nursery School(Apr. 1, 2021)

Asc Kanamachi Nursery School(Apr. 1, 2021)

Asc Higashikasai Nursery School No. 2(Apr. 1, 2021)(School clubs)
Wakuwaku Takinogawa Momiji Hiroba/Takinogawa Momiji Genkikko Club No. 2 (Apr. 1, 2021)
Wakuwaku Takinogawa Momiji Hiroba/Takinogawa Momiji Genkikko Club No. 3 (Apr. 1, 2021)
Mitaka City Rokusho School Club A(Apr. 1, 2021)

Niji-iro Kids Club

(Apr. 1, 2021)

Bancho Elementary School After School No. 1(Apr. 1, 2021)

Bancho Elementary School After School No. 2(Apr. 1, 2021)

Bancho Elementary School After School Kids’Club (Play school)(Apr. 1, 2021)

Jindaiji Children’s House(Apr. 1, 2021)*1: As of April 1, 2021, Tokyo Licensed Nursery Schools named Asc Ontake Nursery School, which had been running since August 1, 2003
and Asc Shimomaruko Nursery School, which had been running since April 1, 2010, were changed into licensed nursery school.
*2: April 1, 2021, with the opening of the Wakuwaku Takinogawa Momiji Hiroba/Takinogawa Momiji Genkikko Club No. 1 above,
Wakuwaku Takinogawa Momiji Hiroba was renamed as Wakuwaku Takinogawa Momiji Hiroba/Takinogawa Momiji Genkikko Club No. 1.
*3: As of March 31, 2021, the Company closed Tokyo Licensed Nursery Schools named Asc Iidabashi Nursery School, Asc Nishishinjuku
Nursery School, Asc Ikebukuro Nursery School, Asc Yukigaya-Otsuka Nursery School, and a private school club named AEL Yokohama
Business Park. In addition, due to the expiration of the contract, the Company withdrew from school clubs named Nakano- ku Kids Plaza
Yato, Kita-ku Sakura Club No. 1, Kita-ku Daini Sakura Club No. 2, and a children's house named Sayama City Chuo Children's House on
March 31, 2021.

As a result, the Group came to have 211 nursery schools, 81 school clubs, 11 children's houses, making a total of 303 facilities forsupporting child-raising at the end of March 2022.
As a result, the Group’s consolidated net sales were 34,373 million yen (up 2.8% year on year), operating income was 3,344
million yen (up 17.1% year on year), ordinary income was 3,358 million yen (up 13.9% year on year), and net income attributableto owners of parent was 2,279 million yen (up 324.1% year on year). Both sales and profits increased year-on-year and reachedrecord-high profits.
The major factors are as follows:
Despite a decrease in the number of children accepted at the beginning of the fiscal year since the State of Emergency was declared
due to the spread of COVID-19, net sales increased by 2.6% year-on-year reflecting an increase in the number of children accepted
for the full year and the introduction of new facilities. The increase in number of children accepted was attributable to our efforts tocreate facilities that would be selected by customers, through implementing online facility tours and online learning programs suchas English, gymnastics, eurhythmics and dance, as well as introducing a new early learning program even under the COVID-19
crisis.
Operating income and ordinary income increased by 17.1% year-on-year, while ordinary income increased by 13.9% year-on-year.
This was attributable to an increase in sales due to an increase in the number of children accepted during the fiscal year as a resultof the various measures mentioned above, as well as to efforts to improve profits and restrain expenses at each facility throughefficient operations through the reallocation of personnel at each facility, as well as the review of recruitment activities and theordering system for various equipment.
In net income attributable to owners of parent, ordinary income increased significantly due to the establishment of an efficientmanagement system.
In the previous fiscal year, our Group closed facilities, where profits deteriorated due to changes in the regional environment, and10 nursery schools, which have land and buildings in the past and operate them as a foothold for the childcare support business. To
avoid the risks of owning these land and buildings, we decided to move them off the balance sheet with a view to future sales andother measures, and recorded impairment losses associated with the use of fixed assets and other factors. As a result, we incurred
extraordinary losses.
However, we recorded an extraordinary profit of 183 million in the fiscal year under review. This was mainly due to a significant
decrease in impairment losses due to improved profitability at each facility and the sale of fixed assets (land and buildings) at 3 ofthe 10 facilities that own the above-mentioned land and buildings. As a result, operating income increased by 324.1% year-on-year.

3With regard to subsidies, etc. received from local governments for rental company housing for nursery school teachers, the amount
was previously recorded as "subsidy income" under non-operating income, but from the current fiscal year, such subsidies, etc. are
now recorded as "net sales." This change in presentation is due to the fact that the qualitative importance of such subsidies, etc. tothe childcare business has increased, and also as a result of confirming and organizing the subsidy system related to the childcare
business as a result of investigating and studying the "Accounting Standard for Revenue Recognition: we made the judgment that it
would be possible to present the actual status of the business more appropriately if the relevant amounts were recorded in the same
category as other subsidies. Due to this change in presentation, reclassification has been made for the previous fiscal year.

(2) Summary of financial condition in the current fiscal year
As for the financial position at the end of the current fiscal year, the total assets amounted to 34,274 million yen (up 4,534 million
yen from the end of the previous fiscal year).
Current assets totaled 20,931 million yen (up 5,791 million yen), mainly reflecting an increase of 6,275 million yen in cash anddeposits, while there were decreases of 300 million yen in accounts receivable.
Fixed assets totaled 13,343 million yen (down 1,257 million yen). This was mainly due to an increase of 70 million yen in
investment securities, while there were decreases of 537 million yen in buildings and structures, 337 million yen in construction inprogress, 180 million yen in long-term loans receivable, 149 million yen in land.
Total liabilities amounted to 22,299 million yen (up 2,566 million yen).
Current liabilities totaled 7,891 million yen (up 62 million yen). This was mainly due to increases of 361 million yen in provision
for bonuses and 89 million yen in income taxes payable, while there were decreases of 194 million yen in current portion of longterm loans payable, 72 million yen in accounts payable-other, 53 million yen in notes and accounts payable-trade, and 50 million
yen in other. Fixed liabilities were 14,407 million yen (up 2,504 million yen). This was mainly due to an increase of 2,510 million
yen in long- term loans payable.
Total net assets at the end of the current fiscal year totaled 11,975 million yen (up 1,967 million yen). This was mainly due to anincrease of 1,938 million yen in retained earnings.

4

(3) Summary of cash flow in the current fiscal year
Cash and cash equivalents (hereinafter referred to as “the funds”) for the current consolidated fiscal year were 3,884 million yen
from the funds obtained through operating activities; 413 million yen obtained through investing activities; and 1,978 million yen
obtained through financing activities, totaling 17,296 million yen, up 6,275 million yen from the end of the previous fiscal year.
The cash flow situations and their reasons for the current consolidated fiscal year are as follows:[Cash flows from operating activities]
The funds provided by operating activities were 3,884 million yen (2,469 million yen was provided during the previous
consolidated fiscal year).
This was mainly due to income before income taxes and minority interests of 3,495 million yen, depreciation and amortization of
708 million yen, an increase in allowance for bonuses of 361 million yen, a decrease in accounts receivable-other of 300 million
yen, and a decrease in other non-current assets of 208 million yen, which were partly offset by income taxes paid of 1,071 million
yen, gain on sales of property, plant and equipment of 148 million yen, and a decrease in advances received of 113 million yen.
[Cash flows from investing activities]
The funds provided by investing activities were 413 million yen (190 million yen during the previous consolidated fiscal year).
This was mainly due to proceeds from sales of property, plant and equipment of 461 million yen, proceeds from receipt of subsidyof 449 million yen, and proceeds from collection of long-term loans receivable of 277 million yen, while there were payments forpurchase of property, plant and equipment of 687 million yen, other payments of 72 million yen, and payments for guarantee
deposits of 37 million yen.
[Cash flows from financing activities]
The funds provided by financing activities were 1,978 million yen (2,155 million yen during the previous consolidated fiscal year).
This was mainly due to the following: proceeds from long-term loans payable of 6,030 million yen, repayment of long-term loans
payable of 3,714 million yen, and cash dividends paid of 338 million yen.
The related index of our Group’s cash flow is as follows:
FY3/20FY3/21

FY3/22

Shareholders’ equity ratio (%)

36.9

33.7

34.9

Shareholders’ equity ratio against
current price (%)

86.7

83.8

55.4

Cash flow to interest-bearing debts
ratio (years)

4.8

5.5

4.1

Interest coverage ratio (x)

38.8

41.6

54.8

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

(4) Future outlook
Looking ahead, we anticipate an increase in the number of dual-income households, problems with children on waiting lists insome areas, a continuing shortage of childcare workers, a further acceleration of the declining birthrate society due to a sharp dropin the birth rate, and continued uncertainty about the future due to the spread of COVID-19. Under such circumstances, rather thanprioritizing quantitative expansion through the opening of new facilities, we must transform ourselves into "facilities that would beselected by customers" by further improving the quality of our childcare support in response to changes in the social environment
and the needs of parents. Taking advantage of this situation, we will make our efforts by setting more attainable managementtargets in the medium-term plan.
Our Group's medium-term management plan will be revised on a rolling basis based on the conditions in the previous fiscal year.
At the same time, we will continue to take advantage of changes in the social environment and maintain the management policies
formulated in the previous fiscal year with the key objectives of "improve profitability and efficiency," "improve soundness," and"improve growth potential." We will effectively allocate and invest management resources to build a solid management foundation

5

and aim for sustainable growth through the creation of new businesses.
Specifically, with DX as the pillar of reform to respond to changes in the social environment, in terms of "improve profitability andefficiency," we will take these initiatives: improve early learning to increase the number of children accepted at existing childcare
support facilities as our existing business, develop and introduce new content, improve profitability by further optimizing staffing.
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 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 and Nurturing Policy,
which were renewed and formulated last year.
In terms of "improve growth potential," we launched a new business, “codomel," a child-raising support platform. This is an online
matching service where users sell and purchase reused products, mainly baby items, clothing, and other child-raising related items.
Going forward, in addition to collaborating with various companies, we will expand our services not only domestically but also
globally, including BtoC business that provides various services and BtoB business that introduces and dispatches professional
human resources and provides on-demand broadcasting of professional training programs, etc.
In addition, the Group has provided support for children with developmental concerns through its response to developmental
support services and providing visiting support services at childcare facilities. To expand support for children with potential
developmental disabilities, we will develop a new business of multi-functional facilities and visiting services based on our
experience in providing highly specialized developmental support based on our expertise in childcare support. We will provide
such childcare support that is closer to more children and their parents.
For the above reasons, as for the consolidated performance for the next fiscal year, the Company forecasts net sales of 35,640
million yen (up 3.7% year on year), operating income of 3,560 million yen (up 6.4%), ordinary income of 3,580 million yen (up6.6%), and net income attributable to owners of parent was 2,325 million yen (up 2.0%).
The following is a breakdown of the childcare facilities that the Group has entrusted with the opening of new facilities during the
fiscal year ended March 2022 and has started new operations on April 1, 2022.
(Nursery school)
Asc Musashi-Koganei Minamiguchi Nursery School
Mitaka City Flexible Childcare Center Hinata(Apr. 1, 2022)(Apr. 1, 2022)(School club/Children's house)
Takenotsuka School Club
Takaban Elementary School Club
Wakuwaku Nishi-Ukima Hiroba/Nishi-Ukima Club No. 1
Wakuwaku Nishi-Ukima Hiroba/Nishi-Ukima Club No. 2
Wakuwaku Nishi-Ukima Hiroba/Nishi-Ukima Club No. 3
Wakuwaku Akabane Hiroba/Akabane Children’s Club No. 1
Wakuwaku Akabane Hiroba/Akabane Children’s Club No. 2
Wakuwaku Akabane Hiroba/Akabane Children’s Club No. 3
Wakuwaku Kirigaoka-sato Hiroba/Kirigaoka-satokko Club No. 1
Wakuwaku Kirigaoka-sato Hiroba/Kirigaoka-satokko Club No. 2
Wakuwaku Kirigaoka-sato Hiroba/Kirigaoka-satokko Club No. 3(Apr. 1, 2022)(Apr. 1, 2022)(Apr. 1, 2022)(Apr. 1, 2022)(Apr. 1, 2022)(Apr. 1, 2022)(Apr. 1, 2022)(Apr. 1, 2022)(Apr. 1, 2022)(Apr. 1, 2022)(Apr. 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, the Company withdrew from school clubs named Rinsen Elementary School After School Club,
Hiroo Elementary School After School Club, Sarugaku Elementary School After School Club, and a children's house named Fukuro Children's
House on March 31, 2022.

6

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

7

3. [Consolidated Financial Statements and Major Notes](1) [Consolidated Balance Sheet](Thousand yen)Previous Fiscal Year
(March 31, 2021)

Current Fiscal Year
(March 31, 2022)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade

11,020,922
88,25917,296,668
68,650Inventories
Accounts receivable - other167,4813,009,655

63,9002,708,806

858,136-5,057794,924-1,76615,139,399

20,931,185

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

12,853,109

12,326,804

Accumulated depreciation and impairment-7,439,556-7,450,666

Buildings and structures, net

5,413,552

4,876,138

203

203

Accumulated depreciation

-92

-121

Machinery, equipment and vehicles, net

111

82

Machinery, equipment and vehicles

Tools, furniture and fixtures

998,658

1,106,051

Accumulated depreciation and impairment-770,948-820,246

Tools, furniture and fixtures, net

227,710285,804Land
Construction in progress

585,678
474,178435,909
137,030

Total tangible fixed assets

6,701,231

5,734,966

Intangible assets
Goodwill

167,122

136,736

Other

47,30737,904

Total intangible assets

214,430

174,640Investment securities
Long-term loans receivable

382,394
3,170,376

453,084
2,989,672

Guarantee deposits
Deferred tax assets

1,906,868
1,631,311

1,903,902
1,579,652

Other
Allowance for doubtful accounts

603,466-8,871

513,833-6,123

Total investments and other assets

7,685,546

7,434,021

14,601,208

13,343,629

29,740,607

34,274,814

Investments and other assets

Total fixed assets
Total assets8

(Thousand yen)Previous Fiscal Year
(March 31, 2021)

Current Fiscal Year
(March 31, 2022)

Liabilities
Current liabilities
Notes and accounts payable-trade
Current portion of long-term loans payable219,266
3,307,412

165,552
3,113,291

Accounts payable – other
Income taxes payable

1,634,568
551,678

1,561,978641,517

Accrued consumption taxes
Reserve for bonuses

160,836
544,474

143,892
906,420

Asset retirement obligation
Other

51,9001,359,619

49,652
1,309,498

Total current liabilities

7,829,755

7,891,803

Long-term debt
Retirement benefit liability

10,305,896
839,667

12,816,466
940,313

Asset retirement obligation
Other

747,503
10,012

647,127
3,650

Fixed liabilities

Total fixed liabilities

11,903,079

14,407,557

19,732,834

22,299,361

Shareholders’ equity
Capital1,603,955

1,603,955

Capital surplus
Retained earnings

1,449,544
7,178,942

1,449,544
9,117,409

Total liabilities
Net assets

Treasury stock-107,515-107,515

10,124,926

12,063,393

Accumulated other comprehensive income
Valuation difference on available-for- salesecurities
Deferred gains or losses on ledges-84,960-49,918-6,948-2,533Remeasurements of defined benefit plans-25,245-35,488

Total shareholders’ equity

Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets

9-117,154-87,940

10,007,772

11,975,452

29,740,607

34,274,814

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

Previous Fiscal Year
(Apr. 1, 2020
- March 31, 2021)
33,500,908
27,687,332(Thousand yen)
Current Fiscal Year
(Apr. 1, 2021
- March 31, 2022)
34,373,668
28,052,451

Gross profit

5,813,575

6,321,216

Selling, general and administrative expenses

2,956,223

2,976,295

Operating income

2,857,352

3,344,921

Non-operating income
Interest income

89,805

77,203

Other

84,132

25,225

Total non-operating income

173,938

102,429

Interest expenses
Handicapped employment levy

58,2039,550

69,13813,500Other

15,7296,115

Non-operating expenses

Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of fixed assets

83,48288,754

2,947,807

3,358,596

3,606

148,715

Gain on reversal of asset retirement obligations
Gain on sales of affiliates

11,10013,73534,896-

Recoveries of written off receivables

5,866

-

Extraordinary income

34,308

183,611Extraordinary loss
Loss (gain) on retirement of fixed assets

3,648

389

Impairment loss (on facilities)
Loss on sales of investment securities

2,020,772
67,71843,6103,052

Total extraordinary loss

2,092,140

47,051

889,976

3,495,156

Corporate, inhabitant and enterprise taxes

936,449

1,175,928

Income taxes-deferred-584,017

39,633

Total income tax

352,431

1,215,561

Net income

537,5442,279,594

Net income attributable to owners of parent

537,5442,279,594

Income before income taxes and minority interests

10[Consolidated Statement of Comprehensive Income]Previous Fiscal Year
(Apr. 1, 2020
- March 31, 2021)
537,544(Thousand yen)
Current Fiscal Year
(Apr. 1, 2021
- March 31, 2022)
2,279,594

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

139,477-1,41035,041
4,415

Foreign currency translation adjustments
Remeasurements of defined benefit plans-2,61039,650-10,242

Total other comprehensive income

175,107

29,214

712,651

2,308,808

712,651

2,308,808

Net income
Total accumulated other comprehensive income

Comprehensive income
BreakdownComprehensive income attributable to owners of parent

11

(3) [Consolidated Statements of Changes in Shareholders’ Equity]
Previous Fiscal Year (April 1, 2020 – March 31, 2021)(Thousand yen)
Shareholders’ equity
CapitalBalance at the beginningof current period
Changes of items during
the period

1,603,955

Capital surplus

Retained earnings

Treasury stock

Total shareholders’equity1,449,544

6,982,526-107,515

9,928,510

Dividends from surplus
Net income attributableto owners of parent
Net changes of items
other than shareholders'equityTotal changes of items
during the period
Balance at the end ofcurrent period-341,127-341,127

537,544537,544--

196,416-

196,416

1,603,955

1,449,544

7,178,942-107,515

10,124,926

Accumulated other comprehensive income
Valuation difference
Deferred gains or
on available-forlosses on ledges
sale securities
Balance at the beginningof current period
Changes of items during
the period-224,438

Foreign currency Remeasurements oftranslation
defined benefit
adjustments
plans-5,5372,610-64,895

Total accumulated
othercomprehensive
income-292,261

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

Total net assets

9,636,249-341,127
537,544
139,477-1,410-2,61039,650175,107

175,107

139,477-1,410-2,61039,650175,107371,523-84,960-6,948--25,245-117,154

10,007,772

12

Previous Fiscal Year (April 1, 2021 – March 31, 2022)(Thousand yen)
Shareholders’ equity
CapitalBalance at the beginningof current period
Changes of items during
the period

1,603,955

Capital surplus

Retained earnings

Treasury stock

Total shareholders’equity1,449,544

7,178,942-107,515

10,124,926

Dividends from surplus
Net income attributableto owners of parent
Net changes of items
other than shareholders'equityTotal changes of items
during the period
Balance at the end ofcurrent period-341,127-341,127

2,279,594

2,279,594--

1,938,466-

1,938,466

1,603,955

1,449,544

9,117,409-107,515

12,063,393

Accumulated other comprehensive income
Valuation difference
Deferred gains or
on available-forlosses on ledges
sale securities
Balance at the beginningof current period
Changes of items during
the period-84,960

Foreign currency Remeasurements oftranslation
defined benefit
adjustments
plans-6,948--25,245

Total accumulated
othercomprehensive
income-117,154

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

Total net assets

10,007,772-341,127
2,279,594
35,041

4,415--10,242

29,21429,21435,041

4,415--10,242

29,214

1,967,680-49,918-2,533--35,488-87,940

11,975,452

13

(4) [Consolidated Statement of Cash Flows](Thousand yen)
Current Fiscal Year
(Apr. 1, 2021
- March 31, 2022)

Previous Fiscal Year
(Apr. 1, 2020
- March 31, 2021)
Net cash provided by (used in) operating activities
Income before income taxes and minority interests

889,976

3,495,156

Depreciation and amortization
Amortization of goodwill

729,258
30,385

708,752
30,385

Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in liabilities relating to retirement
benefits
Loss (gain) on sale of investment securities

4,068-10,361-6,039361,945

143,058

85,032

67,7183,052

Interest and dividends income
Interest expenses-89,805
58,203-77,203
69,138Loss (gain) on retirement of fixed assets
Loss (gain) on sales of fixed assets

3,648-3,606389-148,715

Gain on reversal of asset retirement obligations
Gain on sales of affiliates-11,100-13,735-34,896-

Recoveries of written off receivables
Impairment loss
Decrease (increase) in notes and accounts receivabletrade
Decrease (increase) in inventories-5,8662,020,772

43,610-14,075

19,608-56,221103,580

Decrease (increase) in accounts receivable - other
Decrease (increase) in accrued consumption taxes
Decrease (increase) in notes and accounts payabletrade
Decrease (increase) in accounts payable - other andaccrued expenses
Increase (decrease) in accrued consumption taxes-592,079
89,524

300,848
13,275

19,429-53,713-9,876-55,50743,210-16,943

Increase (decrease) in advances received
Decrease (increase) in other current assets-117,554-39,341-113,090
88,986

Decrease (increase) in other fixed assets
Increase (decrease) in other current liabilities

158,10928,122

208,446-5,068

Increase (decrease) in other fixed liabilities
SubtotalInterest and dividends income received

3,033

5,553

3,324,895

5,026,584

17,338288

Interest expenses paid
Income taxes (paid) refund-59,340-813,724-70,909-1,071,534

Net cash provided by (used in) operating activities

2,469,167

3,884,429

14

(Thousand yen)
Current Fiscal Year
(Apr. 1, 2021
- March 31, 2022)

Previous Fiscal Year
(Apr. 1, 2020
- March 31, 2021)
Net cash provided by (used in) investing activities
Purchase of property, plant and equipment-634,740-687,204

Purchase of intangible assets
Proceeds from sales of property, plant and equipment-9,3605,120-4,512
461,310Proceeds from subsidy income
Proceeds from sales of investment securities

443,436
222,153

449,115
17,481

Payments for guarantee deposits
Proceeds from collection of guarantee deposits-63,469
18,846-37,71044,864

Payments of long-term loans receivableCollection of long-term loans receivable
Proceeds from sales of investments in affiliates
resulting in change in scope of consolidation
Other-110,000
264,716-35,000
277,591

73,538--19,403-72,936

Net cash provided by (used in) investing activities

190,839

413,000

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

4,400,000

6,030,880

Repayments of long-term loans payable
Cash dividends paid

-1,906,063-338,733-3,714,431-338,133

2,155,203

1,978,315-775-

4,814,435

6,275,745

Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period

6,206,487

11,020,922

Cash and cash equivalents at end of period

11,020,922

17,296,668

15

(5) Notes on the consolidated financial statements(Notes on going concern assumption)
None applicable(Changes in accounting policies)(Application of the accounting standard for revenue recognition, etc.)
The Company has applied the “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29, March 31, 2020), etc.
effective from the beginning of the current fiscal year and it recognizes revenue when it satisfies a performance obligation bytransferring promised goods or services (an asset) to a customer. An asset is transferred when the customer obtains control of that
asset. It recognizes as revenue the amount expected to be received upon exchange of goods or services.
There is no impact on the consolidated financial statements for the current and previous fiscal years.
(Application of accounting standard for fair value measurement, etc.)
The Company has applied the Accounting Standard for Fair Value Measurement, etc.” (ASBJ Statement No. 30, July 4, 2019)from the beginning of the current fiscal year, and it has applied the accounting policies stipulated in the “Accounting Standard
for Fair Value Measurement, etc.” prospectively in accordance with the transitional treatment provided in Paragraph 19 of the“Accounting Standard for Fair Value Measurement” and paragraph 44-2 of the “Accounting Standard for Financial Instruments”(ASBJ Statement No. 10 of July 4, 2019). The application of this standard has no effect on the consolidated financial statement.
(Segment Information)
As our group operates within one single segment (nursery service), we have omitted the descriptions as such.
(Per-stock Information)
Previous Fiscal Year
(Apr. 1, 2020
- March 31, 2021)

Current Fiscal Year
(Apr. 1, 2021
- March 31, 2022)

Net assets per share

114.42 yen

136.91 yen

Net income per share

6.15 yen

26.06 yen

(Note) 1. Diluted net income per share is omitted as there are no dilutive shares.
2. The basis for calculating net income per share is as follows:
Previous Fiscal Year
(Apr. 1, 2020
- March 31, 2021)
Net income attributable to ownersof parent (thousand yen)
Net income not attributable tocommon shareholders (thousandyen)
Net income attributable to ownersof parent related to commonshares (thousand yen)
Average number of common
stock during period (shares)(Significant events after the reporting period)
None applicable.

16

Current Fiscal Year
(Apr. 1, 2021
- March 31, 2022)
537,5442,279,594--

537,5442,279,594

87,468,693

87,468,693