Summary of Business Results for the Third Quarter Ended December 31, 2021
[Japan GAAP] (Consolidated)
February 10, 2022
Listed on the TSE 1
URL: https://www.jp-holdings.co.jp

Company
JP-HOLDINGS, INC.
Stock Code
2749
Representative
Tohru Sakai, President and Representative Director
Contact
Ryoji Tsutsumi, Director
Expected date of filing of annual securities report: February 10, 2022
Preparation of supplementary financial document: None
Results briefing: None

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

1. Consolidated business results for the nine months ended December 2021
(April 1, 2021 through December 31, 2021)(1) Consolidated results of operations(% change from the previous corresponding period)
Net sales

Operating income

Net income attributable toowners of parent

Ordinary income

Million yen% Million yen% Million yen% Million yen%
Nine months ended Dec. 2021
25,382
2.8
2,151
18.6
2,170
18.5
1,405
22.9
Nine months ended Dec. 2020
24,679
3.8
1,813
39.1
1,831
36.8
1,143
34.6
(Note) Comprehensive income
Nine months ended December 2021: 1,427 million yen (12.0%)
Nine months ended December 2020: 1,274 million yen (41.0%)
Net income
Diluted net income perper share
share
Yen
Yen
Nine months ended Dec. 2021
16.07
Nine months ended Dec. 2020
13.07
(Note) In the first quarter of the current fiscal year, the Company changed the presentation of "subsidy income" related to the childcare
business, which was previously included in non-operating income, to "net sales." As a result of this change, major management indicesfor the third quarter of the previous fiscal year are based on the indices after this reclassification.

(2) Consolidated financial position
Total assets

Shareholders’ equity
ratio

Net assets

Million yen
As of Dec. 31, 2021
33,973As of Mar. 31, 2021
29,740(Reference) Shareholders’ equity
As of December 31, 2021: 11,094 million yen
As of March 31 2021: 10,007 million yen

Million yen
11,09410,007

%
32.7
33.7

2. Dividends
End of 1Q
Yen-

Year ended Mar. 2021
Year ending Mar. 2022
Year ending Mar. 2022 (forecast)(Notes) Revisions to dividend forecast for the current quarter: None

Annual dividend
End of 2Q
End of 3Q
Yen
Yen
0.00
0.00
-

Year-end

Total

Yen
3.90

Yen
3.90

4.50

4.50

3．Forecast of consolidated business results for the fiscal year ending March 2022
(April 1, 2021 through March 31, 2022)(% change from the previous corresponding period)
Net sales

Operating income

Million yen% Million yen%
Year ending Mar. 2022
33,900
1.2
2,730
-4.5
(Notes) Revisions to business forecast for the current quarter: None

Ordinary income
Million yen
2,760

%
-6.4

Net income attributable toowners of parent

Million yen
1,760

%
227.4

Net income
per share
Yen

20.12

*Notes(1) Changes in significant subsidiaries during the period: None
(2) Application of accounting procedures specific to preparation of the consolidated quarterly financial statements:
None(3) Changes in accounting policies, accounting estimates and restatement①Changes in accounting policies associated with revision of accounting standards:②Changes in accounting policies other than ①③Changes in accounting estimates④Restatement: Yes: None: None: None(4) Shares outstanding (common stock)①Number of shares outstanding at the end of period (treasury stock included)
As of December 31, 2021
87,849,400 shares
As of March 31, 2021
87,849,400 shares②Treasury stock at the end of period
As of December 31, 2021
380,707 shares
As of March 31, 2021
380,707 shares③Average number of stock during period (quarterly cumulative period)
Nine months ended December 2021
87,468,693 shares
Nine months ended December 2020
87,468,693 shares*Quarterly financial summary is not subject to the quarterly review procedures by certified public accountants or
auditing firms.
*Appropriate use of financial forecasts and other important matters∙ Forecasts regarding future performance in this material are based on information currently available to the Company and certain
assumptions that the company deems to be reasonable at the time this report was prepared. Actual results may differ significantly
from the forecasts due to various factors. For information regarding the assumptions that form the basis for the business results
forecasts and notes about using business forecasts, please refer to “1. Qualitative Information on Quarterly Financial Results (3)Consolidated Earnings Forecasts” (Page 4).

〇 Table of Contents of the Appendix

1. Qualitative Information on Quarterly Financial Results………………………………………………….. 2(1) Results of Operations…………………………………………………………………………………. 2(2) Financial Position……………………………………………………………………………………… 4(3) Consolidated Earnings Forecasts……………………………………………………………………… 4
2. Quarterly Consolidated Financial Statements……………………………………………………………… 5(1) Quarterly Consolidated Balance Sheets……………………………………………………………….. 5(2) Quarterly Consolidated Statements of Income and Statements of Comprehensive Income…………… 7(3) Notes on Quarterly Consolidated Financial Statements………………………………………………... 9(Notes on going concern assumption)…………………………………………………………………. 9(Notes if there is a significant change in the amount of shareholders' equity)………………………… 9(Changes in accounting policies)………………………………………………………………………. 9

1

1. Results of Operations(1) Results of Operations
In the third quarter of the fiscal year under review, the Japanese economy showed signs of recovery, reflecting the continued
impact of COVID-19 and progress in the development of vaccinations and treatment drugs, as well as the effects of various
policies. However, the outlook remains uncertain, as there are indications that the infection may spread again due to the spread of
the Omicron variant.
Meanwhile, in the child-raising support business, despite the acceleration of the declining birth rate society due to the sharp
decrease in birth rate and the decrease in the number of children on waiting lists because of people refraining from using thefacilities due to COVID-19, the environment surrounding childcare is rapidly changing. These factors include a continuing
shortage of childcare workers, rising demand for childcare reflecting an increase in the female employment rate, and the need torespond 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 social role of the childcare support business will become increasingly important as the government establishedChildren's Agency early in 2023 and is encouraged to improve the environment for childcare by raising government spending onchildren and strengthening cooperation with local governments.
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 respond to changes in the social
environment, in terms of "improve profitability and efficiency," we will take these initiatives: improve early learning programs toincrease the number of children accepted at existing childcare support facilities as our existing business, developing andintroducing new content, introduction of 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, and accelerate operational efficiency by promoting the use of ICT in facilities.
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 abusiness alliance with GAKKEN HOLDINGS CO., LTD., and worked to reduce costs and improve on-site operations through jointpurchasing, as well as to develop services and products that provide added value. Through these efforts, we will differentiate
ourselves from our competitors and “create facilities that would be selected by customers”. In addition, we are focusing on new
business development to create new value. The new business intends to provide a wide range of products and services related tochildcare during the infant, early childhood and school child ages. We aim to make children and parents of the more than 300
childcare support facilities (nursery schools, school clubs, and children's houses) we operate nationwide, as members of theservice.
In parallel with increasing members of the service, our group will develop a membership-based platform aimed at achieving bothchild-rearing support, effective use of resources, and environmental conservation (SDGs). As the first service, we will launch the“Childcare Product Matching Service” in April 2022. 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 thereuse and recycling of childcare products, and promote this initiative, which takes into consideration the conservation of the global
environment, including the reduction of environmental impact and treatment costs. We will promote this initiatives 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 third quarter of the fiscal year ending
March 2022 according to the plan, including 3 nursery schools (3 in Tokyo) and 8 school clubs and children's houses (8 in Tokyo).
(Nursery school)
Asc Kami-Shakujii Nursery School (Apr. 1, 2021)
Asc Kanamachi Nursery School(Apr. 1, 2021)
Asc Higashikasai Nursery School (Apr. 1, 2021)(School club/Children's house)
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)

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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 Nakanoku 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 September 2021.
As a result, the Group’s consolidated net sales were 25,382 million yen (up 2.8% year on year), operating income was 2,151
million yen (up 18.6% year on year), ordinary income was 2,170 million yen (up 18.5% year on year), and net income attributableto owners of parent was 1,405 million yen (up 22.9% 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 2.8% 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 increased by 18.6% year-on-year. This was attributable to the introduction of new facilities, increase in sales
thanks to the increase in the number of children accepted through above mentioned measures and our efforts to curb expenses andimprove profitability by efficient operation through reallocation of personnel at each facility, recruitment activities, and reviewing
the ordering system for various supplies and equipment, despite an increase in expenses due to special factors, such as an increasein accrued bonuses reflecting a change in the eligible period for bonuses due to the introduction of the new personnel system andan increase in expenses related to the new system introduction.
As operating income significantly increased owing to the establishment of the above-mentioned efficient management system,
ordinary income increased by 18.5% year-on-year, and net income attributable to owners of parent increased by 22.9% year-onyear, despite the recording of 168 million yen in income taxes-deferred as a result of the reversal of deferred tax assets.
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 first quarter of the current fiscal year, such
subsidies, etc. are now recorded as "net sales." This change in presentation is due to the fact that the qualitative importance of such
subsidies, etc. to the 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 thejudgment that it would be possible to present the actual status of the business more appropriately if the relevant amounts wererecorded in the same category as other subsidies. Due to this change in presentation, reclassifications have been made for the third
quarter of the previous fiscal year.

3(2) Financial Position
As for the financial position at the end of the third quarter of the current fiscal year, the total assets amounted to 33,973 million yen(up 4,233 million yen from the end of the previous fiscal year).
Current assets totaled 20,554 million yen (up 5,414 million yen), mainly reflecting increases of 5,811 million yen in cash anddeposits and 100 million yen in others, while there were decreases of 354 million yen in accounts receivable and 125 million yen
in inventories.
Fixed assets totaled 13,419 million yen (down 1,181 million yen). This was mainly due to an increase of 37 million yen in tools,
furniture and fixtures, while there were decreases of 412 million yen in construction in progress, 312 million yen in buildings andstructures, 180 million yen in long-term loans receivable, and 179 million yen in deferred tax assets.
Total liabilities amounted to 22,879 million yen (up 3,146 million yen).
Current liabilities totaled 7,698 million yen (down 131 million yen). This was mainly due to increases of 640 million yen in others,
32 million yen in asset retirement obligations, while there were decreases of 326 million yen in income taxes payable, 154 million
yen in current portion of long-term borrowings, 97 million yen in reserve for bonuses, 84 million yen in notes and accounts
payable-trade, and 78 million yen in accounts payable - other.
Fixed liabilities were 15,181 million yen (up 3,278 million yen). This was mainly due to an increase of 3,320 million yen in longterm loans payable.
Total net assets at the end of the third quarter of the current fiscal year totaled 11,094 million yen (up 1,086 million yen). This was
mainly due to an increase of 1,064 million yen in retained earnings.

(3) Consolidated Earnings Forecasts
The Company has upwardly revised its full- year business forecasts announced in the “Notice Concerning the Revision to Business
Forecasts (Upward Revision to Net Sales and Operating Income) due to Changes in Presentation and Factors behind the Changes
between the Results for the First Quarter of the Fiscal Year ending March 2022 and for the same period of the previous fiscal year
due to the Recording of Reserve for Bonuses” dated August 12, 2021, as follows. For details, please refer to the "NoticeConcerning the Upward Revision to Full-year Business Forecasts" dated November 11, 2021.
In the consolidated business forecasts for the fiscal year ending March 2022, despite a decrease in the number of children acceptedat the beginning of the fiscal year due to the State of Emergency to prevent the spread of COVID-19, we upwardly revised net
sales forecasts reflecting an increase in the number of children accepted during the fiscal year. This was attributable to our efforts
to create facilities that would be selected by customers, through implementing online facility tours and online learning programs
such as English, gymnastics, eurhythmics and dance even under the COVID-19 crisis, as well as introducing a new early learning
program.
Operating income was also upwardly revised. This was attributable to our efforts to curb expenses by improving profitability ateach facility and reviewing the ordering system for various supplies and equipment, such as efficient operation throughreallocation of personnel at each facility and review of recruitment activities, despite an increase in expenses due to special factors,
such as an increase in accrued bonuses reflecting a change in the eligible period for bonuses due to the introduction of the new
personnel system and an increase in expenses related to the new system introduction.
Ordinary income and net income attributable to owners of parent were also upwardly revised from the previous forecasts owing to
the sharp increase in operating income supported by the efficient management structure established through above-mentioned
measures.
We are actively promoting digitization compared to our competitors. We have developed a variety of online programs ahead of ourcompetitors, such as online facility tours, online learning programs such as English, gymnastics, eurhythmics and dance, online
international exchange programs with overseas child care facilities, etc., and introducing Mojikazu Land, a new early learning
program through a business alliance with GAKKEN HOLDINGS CO., LTD. as an expansion of early learning services.
These efforts are not only for the current fiscal year, but also for the next fiscal year to expand the number of children we accept.
These initiatives have been successful in increasing the number of visitors to our facility tours and in creating facilities that would
be selected by customers in each region. We believe that they will have a significant impact on the expansion of our business in thenext fiscal year and beyond.
Actual results may differ from forecasts due to changes in business conditions and other factors in the future. If there are anychanges, the Company will disclose them properly.
Since the timing of the containment of COVID-19 remains uncertain, there is a possibility that it will have a major impact on
consolidated results depending on the spread and containment of the infection and other factors in the future.

42. [Quarterly Consolidated Financial Statements](1) [Quarterly consolidated balance sheets](Thousand yen)Previous Fiscal Year
(March 31, 2021)

Current Third Quarter(December 31, 2021)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade

11,020,922
88,25916,832,176
69,772Inventories
Accounts receivable - other167,4813,009,655

42,1132,655,122

858,136-5,057

958,963-4,117

15,139,399

20,554,032

12,853,109

12,716,743

Accumulated depreciation and impairment-7,439,556-7,616,016

Buildings and structures, net

5,413,552

5,100,726

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

Machinery, equipment and vehicles

203

203

Accumulated depreciation

-92

-114

Machinery, equipment and vehicles, net

111

89

998,658

1,097,404

Accumulated depreciation and impairment-770,948-832,297

Tools, furniture and fixtures, net

Tools, furniture and fixtures

227,710265,107Land
Construction in progress

585,678
474,178585,678
61,600Total tangible fixed assets

6,701,231

6,013,202

167,122

144,333

Intangible assets
Goodwill
Other

47,30737,785

Total intangible assets

214,430

182,118

Investment securities
Long-term loans receivable

382,394
3,170,376

398,457
2,989,774

Guarantee deposits
Deferred tax assets

1,906,868
1,631,311

1,869,034
1,451,898

Other
Allowance for doubtful accounts

603,466-8,871

521,268-6,098

Total investments and other assets

7,685,546

7,224,335

14,601,208

13,419,656

29,740,607

33,973,688

Investments and other assets

Total fixed assets
Total assets5

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

Current Third Quarter(December 31, 2021)

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

134,443
3,152,857

Accounts payable – other
Income taxes payable

1,634,568
551,678

1,556,440
224,683

Accrued consumption taxes
Reserve for bonuses

160,836
544,474

98,560446,850

Asset retirement obligation
Other

51,9001,359,619

84,5481,999,895

Total current liabilities

7,829,755

7,698,279

Long-term debt
Retirement benefit liability

10,305,896
839,667

13,625,940
902,027

Asset retirement obligation
Other

747,503
10,012646,397
6,875

Fixed liabilities

Total fixed liabilities

11,903,079

15,181,240

19,732,834

22,879,519

Shareholders’ equity
Capital1,603,955

1,603,955

Capital surplus
Retained earnings

1,449,544
7,178,942

1,449,544
8,243,403

Total liabilities
Net assets

Treasury stock-107,515-107,515

10,124,926

11,189,387

Accumulated other comprehensive income
Valuation difference on available-for- salesecurities
Deferred gains or losses on ledges-84,960-80,798-6,948-4,771Remeasurements of defined benefit plans-25,245-9,647

Total shareholders’ equity

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

6-117,154-95,218

10,007,772

11,094,169

29,740,607

33,973,688

(2) [Quarterly Consolidated Statements of Income and Statements of Comprehensive Income][Quarterly Consolidated Statement of Income][Third Quarter of FY3/22]

Net sales
Cost of sales

Previous Third Quarter(Apr. 1, 2020
- December 31, 2020)
24,679,595
20,649,394(Thousand yen)
Current Third Quarter(Apr. 1, 2021
- December 31, 2021)
25,382,088
20,972,430

Gross profit

4,030,201

4,409,657

Selling, general and administrative expenses

2,216,349

2,258,190

Operating income

1,813,852

2,151,467

65,96658,083

Other

7,851

15,093

Total non-operating income

73,81873,176

Interest expenses
Other

42,796
13,05250,391
3,716

Total non-operating expenses

55,84854,107

1,831,821

2,170,536

Gain on sales of fixed assets
Gain on reversal of asset retirement obligations

3,606
11,100-Gain on sales of affiliates
Other

13,735
5,866-

Extraordinary income

34,308

-

3,277
-

42
3,052

Non-operating income
Interest income

Non-operating expenses

Ordinary income
Extraordinary income

Extraordinary loss
Loss (gain) on retirement of fixed assets
Loss on sales of investment securities
Impairment loss (on facilities)

115,907-

Total extraordinary loss

119,184

3,095

Income before income taxes and others

1,746,945

2,167,441

Corporate, inhabitant and enterprise taxes
Income taxes-deferred

374,192
229,177

593,413
168,438

Total income tax

603,369

761,852

Net income

1,143,575

1,405,588

Net income attributable to owners of parent

1,143,575

1,405,5887

[Quarterly Consolidated Statement of Comprehensive Income][Third Quarter of FY3/22]
Previous Third Quarter(Apr. 1, 2020
- December 31, 2020)
1,143,575(Thousand yen)
Current Third Quarter(Apr. 1, 2021
- December 31, 2021)
1,405,588

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

111,047-2,266

4,161
2,176

Foreign currency translation adjustments
Remeasurements of defined benefit plans-2,61024,474

15,597

Total other comprehensive income

130,644

21,935

1,274,220

1,427,524

1,274,220

1,427,524

Net income
Total accumulated other comprehensive income

Comprehensive income
BreakdownComprehensive income attributable to owners of parent

8

(3) Notes on Quarterly Consolidated Financial Statements(Notes on going concern assumptions)
Current Third Quarter (April 1, 2021 – December 31, 2021)
None applicable(Notes if there is a significant change in the amount of shareholders' equity)
Current Third Quarter (April 1, 2021 – December 31, 2021)
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 first quarter of the current fiscal year and it recognizes revenue when it satisfies a
performance obligation by transferring promised goods or services (an asset) to a customer. An asset is transferred when thecustomer obtains control of that asset. It recognizes as revenue the amount expected to be received upon exchange of goods orservices.
The application of this standard has no effect on the quarterly consolidated financial statements for the current third quarter, thethird quarter of the previous fiscal year and the previous fiscal year.
(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 first quarter 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 quarterly
consolidated financial statement.

9