FOR IMMEDIATE RELEASE
Kurita Water Industries Reports Earnings for the Six Months Ended September 30, 2019
Tokyo, Japan, November 11, 2019—Kurita Water Industries Ltd. (TSE Securities Code 6370)
announced net sales of 131,758 million yen and profit attributable to owners of parent of 13,490
million yen, or 120.15 yen per share, for the six months ended September 30, 2019 (April 1, 2019 –September 30, 2019).
The Kurita Group (Kurita Water Industries Ltd. and its consolidated subsidiaries and equity
method affiliates) is applying the International Financial Reporting Standards (IFRS) from the firstquarter of the fiscal year ending March 31, 2020. The figures for the same period of the previous
fiscal year and for the previous consolidated fiscal year are also compliant with IFRS. For
information about the difference between financial data under IFRS and those under Japanese GAAP,
please refer to Notes to Consolidated Financial Statements (First-time Adoption) on page 13 of theattached document.
Results of Operations
Total consolidated orders for the Kurita Group in the six months ended September 30, 2019 fell 1.3%
from the level of the year-ago period, to 137,768 million yen, and net sales increased 4.1%, to131,758 million yen. Operating profit was 18,504 million yen, up 127.5% versus the year-ago period,
profit before tax was 18,772 million yen, up 126.3%, and profit attributable to owners of parent
amounted to 13,490 million yen, up 133.6%. Operating profit and profit at other levels rosesignificantly, chiefly reflecting a gain on the sale of fixed assets of 4,801 million yen in the first half
under review and the absence of a loss on transfer of business of 2,885 million yen posted in thesame period of the previous fiscal year.
Looking at the market environment surrounding the Kurita Group, in Japan, production in the
manufacturing sector was weak as exports remained stagnant. Capital expenditure restraint wasevident in certain sectors. Overseas, while economic growth slowed in China and emerging countries
in Asia and in Europe, reflecting the growing effects of trade dispute between the United States andChina, the U.S. economy remained firm. Overall, the global economy grew moderately.
In this environment, the Group strengthened its sales system in each market and each region toincrease customer intimacy. Meanwhile, the Group promoted proposals of total solutions that willcontribute to solving issues of customers, such as environmental mitigation, energy saving andproductivity improvement.
From the first quarter of this fiscal year, the operating results at U.S.-based U.S. Water Services,
Inc., as well as U.S.-based Avista Technologies, Inc. and U.K.-based Avista Technologies (UK) Ltd.
have been newly consolidated.
Segment Information
The Group consists of two reportable segments in its segment information: Water Treatment
Chemicals and Water Treatment Facilities
Water Treatment Chemicals
Total Group orders for the Water Treatment Chemicals segment were 58,576 million yen, up 11.6%
versus the same period of the fiscal year ended March 31, 2019, while net sales rose 12.7%, to58,484 million yen.
Operating profit stood at 6,435 million yen, up 163.4% year on year, chiefly reflecting a decreasein other expenses due to the absence of a loss on transfer of business of 2,885 million yen (atemporary loss) related to the aluminum compound business in Europe posted in the same period of
the previous fiscal year.
Orders and net sales in Japan, primarily orders and net sales of process treatment chemicals foriron and steel production, increased, reflecting the Group’s efforts to gain new customers byproposing total solutions that will contribute to energy saving at customers’ plants.
1Orders and net sales rose also overseas despite the effect of the transfer of the aluminumcompound business in Europe in the previous fiscal year, primarily due to the new consolidation ofoperating results (for six months) in the water treatment chemicals business at U.S. Water Services,
Inc. and operating results (for four months) at U.S.-based Avista Technologies, Inc. and U.K.-based
Avista Technologies (UK) Ltd.
Water Treatment Facilities
Total Group orders for the Water Treatment Facilities segment were 79,192 million yen, down 9.1%
versus the same period of the previous fiscal year. Net sales declined 1.8%, to 73,274 million yen.
Operating profit came to 12,145 million yen, up 108.9% year on year, reflecting a gain on sale of
fixed assets of 4,780 million yen posted in other income resulting primarily from the sale of certain
equipment in the ultrapure water supply business and the absence of temporary additional costs due
to an insufficient production system in the same period of the previous fiscal year.
In Japan, orders for water treatment facilities for the electronics industry decline from the same
period of the previous fiscal year, during which orders for large projects were received. However, net
sales increased thanks to progress in construction work in projects for which orders were received in
the previous fiscal year. Both orders and net sales rose in maintenance services due to the orders for
expansion and renovation projects for the purpose of increasing production capacity at customers’
plants.
Orders for water treatment facilities for general industries climbed, but net sales declined. Bothorders and net sales in maintenance services for general industries fell in reaction to strong orders
and net sales in the same period of the previous fiscal year. Orders for facilities for electric power
plants declined in reaction to orders for large projects in the same period of the previous fiscal year,
but net sales increased due to progress in construction work for a backlog of orders. Orders and net
sales of soil remediation decreased, reflecting a stalling of orders and sales from large projects.
Overseas, orders increased, chiefly attributable to the new consolidation of operating results (forsix months) in the water treatment facilities business of U.S. Water Services, Inc. However, net sales
decreased in reaction to sales from large projects posted in the same period of the previous fiscal year.
Net sales in the ultrapure water supply business in Japan and overseas fell due to the effect ofchanges in contracts with a certain customer.
Financial Condition
Condition of assets, liabilities and equity
1) Total assets: 387,797 million yen, an increase of 29,131 million yen from the end of the previous
fiscal year)
Current assets totaled 155,881 million yen at the end of the second quarter (September 30, 2019), an
increase of 4,756 million yen from the end of the previous fiscal year (March 31, 2019). This was
mainly attributable to an increase in cash and cash equivalents of 2,007 million yen, chiefly
reflecting the execution of commitment line contracts, and an increase in trade and other receivablesof 2,663 million yen mainly due to an increase in sales, offsetting funds used for businessacquisitions and capital expenditures.
Non-current assets totaled 231,915 million yen at the end of the second quarter, an increase of
24,375 million yen from the end of the previous fiscal year. Property, plant and equipment increased
7,133 million yen, chiefly due to capital expenditure in the ultrapure water supply business (Water
Treatment Facilities business). Right-of-use assets rose 3,593 million yen, chiefly reflecting theacquisition of the right of use of land. Goodwill climbed 6,625 million yen due to acquisitions inNorth America and Europe (Water Treatment Chemicals business). Investments accounted for using
equity method increased 6,532 million yen owing to an increase in equity method affiliates (Water
Treatment Chemicals business and Water Treatment Facilities business).

22) Liabilities: 143,340 million yen, an increase of 23,789 million yen from the end of the previous
fiscal year.
Current liabilities totaled 94,450 million yen at the end of the period, an increase of 21,328 million
yen from the end of the previous fiscal year. This was mainly due to an increase in borrowings of
29,998 million yen resulting from the implementation of a commitment line of 30,000 million yen.
Non-current liabilities totaled 48,890 million yen at the end of the period, an increase of 2,462
million yen from the end of the previous fiscal year. This was primarily attributable to an increase inlease liabilities of 3,410 million yen due to the acquisition of the right of use of land.
3) Equity: 244,456 million yen, an increase of 5,342 million yen from the end of the previous fiscal
yearThis mainly reflected an increase in retained earnings of 10,689 million yen chiefly due to theposting of a profit for the period, partly offset by a decrease in other components of equity of 5,373
million yen due to a decline in exchange differences on translation of foreign operations associatedwith the stronger yen against foreign currencies.
Cash Flows
Consolidated net cash and cash equivalents at the end of the first half (September 30, 2019) totaled
37,554 million yen, an increase of 2,007 million yen from the end of the previous fiscal year (March
31, 2019).
The various cash flows and related factors are outlined below.
1) Cash Flows from Operating Activities
Net cash provided by operating activities during the first half ended September 30, 2019 totaled
13,875 million yen, a decrease of 13,459 million yen from the same period of the previous fiscal year.
Inflows from profit before tax of 18,772 million yen and depreciation and amortization of 8,561
million yen were partly offset by an increase in inventories of 1,059 million yen, a decrease in tradeand other payables of 1,951 million yen and income taxes paid of 5,784 million yen.
2) Cash Flows from Investing Activities
Net cash used in investing activities totaled 35,260 million yen, an increase of 7,993 million yen
from the same period of the previous fiscal year. Cash was used for purchases of property, plant andequipment of 19,104 million yen, payments for acquisition of business of 8,501 million yen, andpurchases of shares and investments in capital of subsidiaries and affiliates of 5,860 million yen.
3) Cash Flows from Financing Activities
Net cash provided by financing activities totaled 24,371 million yen, an increase of 29,816 million
yen from the same period of the previous fiscal year. Inflows chiefly from a net increase in
short-term borrowings of 30,008 million yen were partly offset by dividends paid of 3,061 million
yen.
The Group’s basic policy is to constantly secure liquidity necessary for business operations andresource of funds. Short-term working capital is basically supplied by the Group’s own funds.
Capital investment and other investments in growth fields depend chiefly on the Group’s own funds,
but the Group considers financing through bank loans as needed. As of the end of the period underreview, the Group has concluded commitment line contracts with four financial institutions (realizedborrowings: 30,000 million yen; unrealized borrowings: 40,600 million yen).
Forecasts for the Fiscal Year Ending March 31, 2020
With respect to the consolidated business forecasts for the fiscal year ending March 31, 2020, theGroup will revise its forecast for the full year net sales stated in the quarterly report of first quarter
financial results for the fiscal year ending March 31, 2020 announced on August 9, 2019 as described3

below in light of a decrease in net sales during the first six-month period under review comparedwith the previous forecast chiefly due to the effect of exchange rates (stronger yen and weaker
foreign currencies).
The business forecasts are made by the Company based on information available at the time of
publication of this report and may differ from actual results due to changes in a range of factors.
(Consolidated business forecasts)
Revision to the consolidated business forecast for the fiscal year ending March 31, 2020 (April 1,
2019 – March 31, 2020)(Million yen)

Net sales

Profit attributable

Operating profit Profit before tax to owners of parent

Basic earnings
per share (Yen)Previous forecast (A)280,000

30,00030,20021,300189.71

Revised forecast (B)273,000

30,00030,20021,300189.69Change (B-A)
Percentage change (%)(7,000)
(2.5)

-

-

-

(0.02)(0.0)(Note) The Company is voluntarily applying the International Financial Reporting Standards (IFRS) to its consolidated
financial statements from the first quarter of the fiscal year ending March 31, 2020 under review. The revisions
to the consolidated business forecasts above are prepared under IFRS. The results for the fiscal year ended
March 31, 2019 are not stated here because Japanese GAAP was applied in the fiscal year ended March 31,
2019.

(Note on forward-looking statements)
The forward-looking statements such as business forecasts included in this document are based on the information
available to the Company at the time of the announcement and on certain assumptions considered reasonable, and theCompany makes no representations as to their achievability. Actual results may differ materially from the forecast
depending on a range of factors. Please refer to Forecast for the Fiscal Year Ending March 31, 2020 on page 3 to see theassumptions for the business forecast and a note on the use of the business forecast.

4

Condensed quarterly consolidated financial statements(1) Condensed quarterly consolidated statement of financial position(Million yen)
Date of transition to
IFRS(April 1, 2018)

As of March 31, 2019

As of September 30,
2019

Cash and cash equivalents

60,53135,54737,554

Trade and other receivables

89,354100,497

103,160

Other financial assets

2,809

1,709

2,334

AssetsCurrent assets

Inventories

8,078

9,348

10,258Other current assets

2,619

4,022

2,573

Total current assets

163,393

151,125

155,881

81,336103,275

110,408

Non-current assets
Property, plant and equipment
Right-of-use assets

11,331

12,226

15,819Goodwill

19,96637,95444,579Intangible assets

10,197

17,515

16,594

Investments accounted for using equity method

1,098

956

7,488

Other financial assets

40,10328,592

29,887

Deferred tax assets

4,581

6,803

6,875

Other non-current assets

277

216

263

Total non-current assets

168,893

207,540

231,915332,287358,666

387,797

Total assets

5

(Million yen)
Date of transition to
IFRS(April 1, 2018)

As of March 31, 2019

As of September 30,
201940,13949,57640,159Liabilities and equity
Current liabilities
Trade and other payables
Borrowings

2,963

385

30,383

Lease liabilities

2,958

3,818

3,687

Other financial liabilities
Income taxes payable
Provisions

12

1

218

4,737

5,887

5,330

572

1,026

1,062

Other current liabilities

10,72912,427

13,608

Total current liabilities

62,11373,122

94,450Non-current liabilities
Borrowings

2,331

1,717

1,407

Lease liabilities

9,397

9,628

13,038Other financial liabilities

1,122

1,771

1,994

Retirement benefit liability

16,374

16,58016,961

Provisions

331

491

491

Deferred tax liabilities

547

854

864

Other non-current liabilities

761

15,385

14,133

Total non-current liabilities

30,86846,42848,89092,981

119,551

143,340

Total liabilities
EquityShare capital

13,45013,45013,450Capital surplus

10,95910,265

10,313

Treasury shares(10,943)(10,932)(10,891)

Other components of equity

16,785

4,838

(535)

Retained earnings

207,005

219,590

230,279

Total equity attributable to owners of parent

237,257

237,212242,616

2,048

1,902

1,839

239,305

239,114

244,456

332,287358,666

387,797

Non-controlling interests
Total equity
Total liabilities and equity6(2) Condensed quarterly consolidated statement of profit or loss and comprehensive income
Condensed quarterly consolidated statement of profit or loss
(Million yen)Six months ended
September 30, 2018

Six months ended
September 30, 2019

Net sales

126,542

131,758

Cost of sales

87,32885,382Gross profit

39,213

46,37628,282

32,694

Other income

676

5,318

Other expenses

3,475

495

Operating profit

Selling, general and administrative expenses

8,132

18,504

Finance income

369

387

Finance costs

237

210

Share of profit of investments accounted for using equity
method

33

89

8,297

18,772

Profit before tax
Income tax expense

2,548

5,250

Profit for the period

5,749

13,521

5,775

13,490

(26)

30

5,749

13,521

51.44

120.15‒‒

Profit attributable to
Owners of parent
Non-controlling interests
Profit for the period
Earnings per share
Basic earnings per share (yen)Diluted earnings per share (yen)7

Condensed quarterly consolidated statement of comprehensive income(Million yen)Six months ended
September 30, 2018
Profit for the period

Six months ended
September 30, 2019

5,749

13,521

2,866

(197)

25

(5)

2,892

(203)

Other comprehensive income
Items that will not be reclassified to profit or loss
Net change in the fair value of financial assets measured
through other comprehensive income
Remeasurements of defined benefit plans
Total of items that will not be reclassified to profit or loss
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign operations(2,169)(5,175)

Cash flow hedges

(92)

323

Share of other comprehensive income of investments
accounted for using equity method

(20)

(109)

Total of items that may be reclassified to profit or loss

(2,282)(4,962)Other comprehensive income, net of tax

609(5,165)Comprehensive income for the period

6,358

8,356

6,437

8,367

Comprehensive income attributable to
Owners of parent
Non-controlling interests

(79)

(11)

Comprehensive income

6,358

8,356

8

(3) Condensed quarterly consolidated statement of changes in equity
Six months ended September 30, 2018 (April 1, 2018 - September 30, 2018)(Million yen)
Equity attributable to owners of parent
Other components of equity

Balance as of April 1, 2018

Share capital

Capital surplus

Treasury shares

Exchangedifferences ontranslation offoreign
operations

Financial assets
measured at fairvalue throughothercomprehensive
incomeCash flow
hedges13,45010,959(10,943)‒

2

Profit for the period

‒

‒

‒

‒

‒

‒

Other comprehensive income

‒

‒

‒

(2,137)

(92)

2,866

Total comprehensive income for the period

16,783‒‒‒(2,137)

(92)

2,866

Purchase of treasury shares

‒

‒

(1)

‒

‒

‒

Dividends

‒

‒

‒

‒

‒

‒

Share-based payment transactions

‒

‒

14

‒

‒

‒

Changes in ownership interests in subsidiaries

‒

(294)

‒

(21)

‒

‒

Transfer from other components of equity toretained earnings

‒

‒

‒

‒

‒

(1,630)

Other

‒

(558)

‒

‒

‒

‒

‒

(852)

12

(21)

‒

(1,630)13,45010,107(10,931)(2,158)(90)

18,019Total transactions with owners
Balance as of September 30, 2018

(Million yen)
Equity attributable to owners of parent
Other components of equity
Remeasurementsof defined
benefit plans

Retainedearnings

Total

Non-controllinginterests

Total

Total

Balance as of April 1, 2018‒16,785207,005

237,257

2,048

239,305

Profit for the period

‒

‒

5,775

5,775

(26)

5,749

Other comprehensive income

25

662

‒

662

(52)

609

25

662

5,775

6,437

(79)

6,358

Purchase of treasury shares

‒

‒

‒

(1)

‒

(1)

Dividends‒‒(2,927)(2,927)(5)(2,933)

Share-based payment transactions

‒

‒

‒

14

‒

14

Changes in ownership interests in subsidiaries

‒

(21)

‒

(315)

(782)

(1,098)Transfer from other components of equity toretained earnings(25)(1,655)

1,655

‒

‒

‒

Total comprehensive income for the period

Other
Total transactions with owners
Balance as of September 30, 2018

‒

‒

49

(508)

783

274

(25)

(1,677)(1,222)(3,739)(5)(3,744)‒

15,770211,558

239,955

1,963

241,9199

Six months ended September 30, 2019 (April 1, 2019 - September 30, 2019)(Million yen)
Equity attributable to owners of parent
Other components of equity

Share capital

Balance as of April 1, 2019

Capital surplus Treasury shares

Exchangedifferences ontranslation offoreign
operations

Cash flow
hedgesFinancial assets
measured at fairvalue throughothercomprehensive
income13,45010,265(10,932)(4,671)

310

Profit for the period

‒

‒

‒

‒

‒

‒

Other comprehensive income

‒

‒

‒

(5,243)

323

(197)

Total comprehensive income for the period

9,199

‒

‒

‒

(5,243)

323

(197)

Purchase of treasury shares

‒

‒

(1)

‒

‒

‒

Dividends

‒

‒

‒

‒

‒

‒

Share-based payment transactions

‒

53

42

‒

‒

‒

Changes in ownership interests in subsidiaries

‒

(4)

‒

‒

‒

‒

Transfer from other components of equity toretained earnings

‒

－

‒

‒

‒

(256)

Other

‒

(0)

‒

‒

‒

－

‒

48

40

‒

‒

(256)

13,450

10,313(10,891)(9,914)

633

8,745

Total transactions with owners
Balance as of September 30, 2019

(Million yen)
Equity attributable to owners of parent
Other components of equity
Remeasurementsof defined
benefit plans

Retainedearnings

Total

Non-controllinginterests

Total

Total

Balance as of April 1, 2019

‒

4,838

219,590237,212

1,902

239,114

Profit for the period‒‒

13,49013,49030

13,521Other comprehensive income(4)(5,123)‒(5,123)(42)(5,165)(4)(5,123)

13,490

8,367

(11)

8,356

Purchase of treasury shares

‒

‒

‒

(1)

‒

(1)

Dividends‒‒(3,040)(3,040)(10)(3,050)Share-based payment transactions

‒

‒

‒

95

16

111

Changes in ownership interests in subsidiaries

‒

‒

‒

(4)

(56)

(60)

Transfer from other components of equity toretained earnings

4

(251)

251

‒

‒

‒

Other

Total comprehensive income for the period

‒

‒

(12)

(12)

‒

(12)

Total transactions with owners

4

(251)

(2,801)(2,963)(50)(3,014)

Balance as of September 30, 2019

‒

(535)

230,279

242,616

1,839

244,45610

(4) Condensed quarterly consolidated statement of cash flows(Million yen)Six months ended
September 30, 2018

Six months ended
September 30, 2019

Cash flows from operating activities
Profit before tax

8,297

18,772

Depreciation and amortization

9,459

8,561

(33)

(89)

(5)

(4,795)

Share of loss (profit) of investments accounted forusing equity method
Loss (gain) on sale of fixed assets
Decrease (increase) in inventories(784)(1,059)Decrease (increase) in trade and other receivables(3,345)

532

Increase (decrease) in trade and other payables

14,854(1,951)

Other

3,341

(504)

Subtotal

31,784

19,466

Interest received

29

24

Dividends received

446

214

Interest paid
Income taxes paid

(95)

(45)

(4,829)(5,784)

Net cash provided by (used in) operating activities

27,334

13,875(15,437)(980)

Proceeds from withdrawal of time deposits

1,505

800

Purchase of property, plant and equipment
Proceeds from sale of property, plant andequipment(13,287)(19,104)15

508

Purchase of intangible assets

(556)

(641)

Proceeds from sale of investments

3,438

41

Payments for acquisition of business (after
deduction of cash and cash equivalents included inacquired assets)(2,338)(8,501)‒(5,860)(607)(1,522)(27,267)(35,260)

383

30,008Cash flows from investing activities
Payments into time deposits

Purchase of shares and investments in capital ofsubsidiaries and affiliates
Other
Net cash provided by (used in) investing activities
Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Repayments of long-term borrowings

(308)

(268)

Dividends paid

(2,945)(3,061)

Purchase of shares of subsidiaries not resulting inchange in scope of consolidation(1,094)(60)(1,480)(2,246)(5,445)24,371

(237)

(979)

Other
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents(5,616)

2,007

Cash and cash equivalents at beginning of period

60,53135,547

Cash and cash equivalents at end of period

54,91537,55411

Notes to Consolidated Financial Statements(Notes on the Going-concern Assumption)
Six months ended September 30, 2019 (April 1, 2019 – September 30, 2019)
Not applicable(Segment Information)
Information of reportable segments
Six months ended September 30, 2018 (April 1, 2018 – September 30, 2018)(Million yen)
Reportable Segments

Sales
Sales to outside customers
Inter-segment sales and transfers
Total
Segment income

Adjustments(Note 1)

Amounts
reported on thecondensed
quarterly
consolidated
statement of
profit or loss
(Note 2)Water
Treatment
Chemicals

Water
Treatment
Facilities

51,894395

74,648691

126,542
1,086‒(1,086)

126,542‒

52,28975,340127,629(1,086)

126,542

2,443

5,813

8,256

(124)

8,132

Total

Finance income

369

Finance costs

237

Share of profit of investments accounted for using equity method

33

Profit before tax

8,297(Notes) 1. Segment income: Amount resulting from eliminations of inter-segment transactions.
2. Segment income is shown at the operating income level.

Six months ended September 30, 2019 (April 1, 2019 – September 30, 2019)(Million yen)
Reportable Segments

Sales
Sales to outside customers
Inter-segment sales and transfers
Total
Segment income

Adjustments(Note 1)

Amounts
reported on thecondensed
quarterly
consolidated
statement of
profit or loss
(Note 2)Water
Treatment
Chemicals

Water
Treatment
Facilities

58,484361

73,274
955

131,758
1,317‒(1,317)

131,758‒

58,84674,229133,076(1,317)

131,758

6,435

12,145

18,580(76)

18,504

Total

Finance income

387

Finance costs

210

Share of profit of investments accounted for using equity method
Profit before tax

89
18,772(Notes) 1. Segment income: Amount resulting from eliminations of inter-segment transactions.
2. Segment income is shown at the operating income level.

12(First-time Adoption)
The Group is disclosing quarterly consolidated financial statements complying with IFRS from the first quarter of this fiscal year. The
most recent consolidated financial statements prepared under Japanese GAAP are those for the fiscal year ended March 31, 2019. The
date of transition to IFRS is April 1, 2018.
(1) Exemptions set out in IFRS 1
In principle, an entity that applies IFRS for the first time (hereinafter “First-time Adopter”) is requested to retrospectively apply IFRS.
However, IFRS 1 - First-time Adoption of International Financial Reporting Standards (hereinafter “IFRS 1”) sets out standards towhich exemptions have to be applied mandatorily and standards to which exemptions are applied optionally. The effects of the applied
exemptions are adjusted by retained earnings or other components of equity on the date of transition to IFRS. When the Group moved
from Japanese GAAP to IFRS, it applied the following exemptions:
I. Business Combinations
The First-time Adopter is allowed to choose not to retrospectively apply IFRS 3 Business Combinations (hereinafter “IFRS 3”) tobusiness combinations before the date of transition to IFRS. The Group has applied the exemption and has chosen not toretrospectively apply IFRS 3 to business combinations before the date of transition. As a result, goodwill that resulted from businesscombinations before the date of transition is based on the book value on the date of transition under Japanese GAAP.
The Group conducted an impairment test related to goodwill on the date of transition regardless of the existence of signs of
impairment.
II. Deemed Cost
IFRS 1 allows entities to use the fair value of property, plant and equipment, investment property and intangible assets on the date oftransition to IFRS as a deemed cost on the date of transition. The Group uses the fair value of certain property, plant and equipmenton the date of transition as deemed cost on the date of transition under IFRS.
III. Cumulative Translation Differences for Foreign Operations
IFRS 1 allows entities to choose to deem cumulative translation differences for foreign operations as of the date of transition to IFRS
to be zero. The Group has chosen to deem cumulative translation differences for foreign operations to be zero as of the date oftransition.
IV. Share-based Payment Transactions
The Group has chosen not to apply IFRS 2 to stock compensation that was vested before the date of transition.
V. Leases
IFRS 1 allows the First-time Adopter to determine whether contracts existing as of the date of transition to IFRS include leases,
based on facts and circumstances existing on the date of transition. It also allows the First-time Adopter to measure lease liabilities atthe present value of the remaining lease payments, which is calculated by discounting the remaining lease payments using thelessee’s incremental borrowing rate on the date of transition, and to make the amount of right-of-use assets the same as the amount oflease liabilities. The First-time Adopter is allowed to recognize as expenses leases whose term expires within 12 months of the dateof transition and leases whose underlying assets are of low value.
The Group applies the exemption to recognize and measure leases.
(2) Mandatory exceptions in retrospective application set out in IFRS 1IFRS 1 prohibits retrospective application of IFRS in relation to estimates, derecognition of financial assets and financial liabilities,
hedge accounting, non-controlling interests, classification and measurement of financial assets, etc. The Group has been applying these
items from the date of transition onwards.
(3) Reconciliation from Japanese GAAP to IFRSThe tables below are reconciliation sheets required in IFRS 1.
The reclassification column is for the figures of items that do not affect retained earnings or comprehensive income. The difference due
to changes in recognition, measurement and accounting period column is for the figures of items that affect retained earnings andcomprehensive income.

13

I. Reconciliation of Assets on Date of Transition to IFRS (April 1, 2018)(Million yen)Account under Japanese GAAP

Japanese
GAAP

Difference due
to changes inrecognition,
Reclassification
measurement
and accounting
period

IFRS

Notes

Assets

Account under IFRS

AssetsCurrent assets

Current assets

Cash and deposits

61,086(1,652)

1,097

60,531(1)

Cash and cash equivalents

Notes and accounts
receivable – trade

86,865

(464)

2,954

89,354(1), (2)Trade and other receivables

–

2,769

40

2,809

(1)

Finished products

3,968(3,968)––Work in process

3,621(3,621)––

Raw materials and supplies

2,800(2,800)–––

10,390(2,312)

8,078(1), (2)

Other

2,531

(1,119)

1,206

2,619

(1)

Allowance for doubtful
accounts

(464)

464

–

–

160,409–

2,984

163,393

Total current assets

Intangible fixed assets

Inventories

Other current assets

Total current assets

Non-current assets
Property, plant andequipment

Other financial assets

Non-current assets
86,028(86,028)–––

81,603(266)

81,336(1), (3)Property, plant and equipment(1), (4)Right-of-use assets
Goodwill

–

4,455

6,875

11,331

31,003(31,003)–––

20,362(396)

19,966(1), (5)–10,610(412)

10,197(1)

Intangible assets

35,683(35,683)

–

–

–

1,147

(48)

1,098

(1)

Investments accounted forusing equity method–

38,6301,473

40,103(1), (6)Other financial assets(1), (7)Deferred tax assets

Investments and other assets
Investment securities

Deferred tax assets

4,860(1,119)

840

4,581

Other

5,238

(5,238)

–

–

–

967

(690)

277

Allowance for doubtful
accounts

(176)

176

–

–

Total non-current assets

162,637(1,119)7,376

168,893

323,046(1,119)1,0360332,287

Total assets(1)

Other non-current assets

Total non-current assets
Total assets

14

(Million yen)Account under Japanese GAAP

Japanese
GAAP

Difference due
to changes inrecognition,
Reclassification
measurement
and accounting
period

IFRS

Notes

Liabilities

Account under IFRS

Liabilities and equity

Current liabilities

Current liabilities

Notes and accounts payable– trade28,875(28,875)––

Accounts payable – other

10,995(10,995)–––

38,575

1,564

40,139(1)

Trade and other payables

–

1,337

1,625

2,963

(1)

Borrowings
Other financial liabilities

–

–

12

12

(1)

–

635

2,322

2,958

(1), (4)(1)

Income taxes payable

Provisions

Income taxes payable

4,806

–

(68)

4,737

Provision for bonuses

2,420(2,420)

–

–

695

(695)

–

–

–

549

23

572

(1)

Other

8,355

1,888

486

10,729(1), (8),(9)

Total current liabilities

56,149–5,964

62,113

Other provision

Other current liabilities
Total current liabilities

Non-current liabilities
Lease obligations

Lease liabilities

Non-current liabilities
4,038(4,038)

–

–

–

2,388

(56)

2,331

(1)

–

4,038

5,359

9,397

(1), (4)

–

1,644

(522)

1,122

(1)

16,610–(235)

16,374(1), (10)

191

(190)

330

331

(1)

1,119

(492)

(79)

547

(1), (7)

Other

4,084

(4,469)

1,146

761

(1)

Total non-current liabilities

26,044(1,119)5,943

30,868

Total non-current liabilities

82,193(1,119)11,907

92,981

Total liabilities

Net defined benefit liability
Provision
Deferred tax liabilities
related to revaluation

Total liabilities
Net assets

Borrowings
Lease liabilities
Other financial liabilities
Retirement benefit liability
Provisions
Deferred tax liabilities
Other non-current liabilities

EquityShareholders’ equity
Common stock

13,450––13,450Share capital

Capital surplus

10,959––10,959

Capital surplus

Retained earnings

209,149–(2,144)207,005(1), (12),(13)

Retained earnings

Accumulated othercomprehensive income

16,187–597

16,785(1),(12),(13)

Other components of equity

Treasury stock(10,943)––(10,943)

238,803–(1,546)237,257

Non-controlling interests

Treasury shares
Total equity attributable toowners of parent

2,049

–

(1)

2,048

Total net assets

240,853–(1,547)239,305(1), (13)Total equity

Non-controlling interests

Total liabilities and net assets

323,046(1,119)10,360332,287

Total liabilities and equity

15II. Reconciliation of Assets at End of Second Quarter of the Previous Fiscal Year (September 30, 2018)(Million yen)Account under Japanese GAAP

Japanese
GAAP

Difference due
to changes inrecognition,
Reclassification
measurement
and accounting
period

IFRS

Notes

AssetsAssetsCurrent assets

Current assets

Cash and deposits

69,579(14,663)–

54,915

Notes and accounts
receivable – trade

91,081

158

966

92,207–

16,612(4)

16,608Finished products

4,103(4,103)––Work in process

1,940(1,940)––Raw materials and supplies

2,653(2,653)

–

–

–

8,696

(44)

8,652

Other

4,294

(2,587)

137

1,844

Allowance for doubtful
accounts

(480)

480

–

–

173,172–

1,055

174,227

Total current assets

Cash and cash equivalents(2)

Intangible fixed assets

Trade and other receivables
Other financial assets(2)

Inventories
Other current assets

Total current assets

Non-current assets
Property, plant andequipment

Account under IFRS

Non-current assets
91,996(91,996)–––

85,8196785,887(3)

Property, plant and equipment(4)

Right-of-use assets(5)

Goodwill

–

6,176

4,721

10,897

31,292(31,292)–––

21,5671,041

22,608

–

9,725

(116)

9,608

35,910(35,910)

–

–

–

996

(37)

959

Intangible assets

Investments and other assets
Investment securities

Investments accounted forusing equity method–

38,917

1,704

40,621(6)

Other financial assets

Deferred tax assets

4,923(1,119)

895

4,699

(7)

Deferred tax assets

Other

5,855

(5,855)

–

–

–

1,673

(954)

719

Allowance for doubtful
accounts

(177)

177

–

–

Total non-current assets

169,801(1,119)7,322

176,004

342,973(1,119)8,378

350,231

Total assets

Other non-current assets

Total non-current assets
Total assets

16

(Million yen)Account under Japanese GAAP

Japanese
GAAP

Difference due
to changes inrecognition,
Reclassification
measurement
and accounting
period

IFRS

Notes

Liabilities

Account under IFRS

Liabilities and equity

Current liabilities

Current liabilities

Notes and accounts payable– trade24,944(24,944)––

Accounts payable – other

9,250(9,250)–––38,243407

38,650Trade and other payables

–

3,319

–

3,319

Borrowings

–

972

2,162

3,135

3,569

–

(6)

3,563

Income taxes payable
Provision for bonuses

2,783(2,783)––

Other provision

1,159(1,159)

–

–

–

846

–

846

Other

15,670(5,244)

1,679

12,104

Total current liabilities

57,377–

4,243

61,621(4)

Provisions(8), (9)Other current liabilities
Total current liabilities

Non-current liabilities
Lease obligations

Lease liabilities
Income taxes payableNon-current liabilities
5,379(5,379)

–

–

–

1,976

–

1,976

–

5,379

3,648

9,027

(4)

Lease liabilities

–

1,654

38

1,693

(11)

Other financial liabilities

16,688–(228)

16,459

(10)

175

(175)

382

382

Deferred tax liabilities
related to revaluation

1,119

3

(581)

541

Other

19,602(4,579)1,586

16,609Total non-current liabilities

42,965(1,119)4,844

46,690Total non-current liabilities

100,343(1,119)9,088

108,312

Total liabilities

Net defined benefit liability
Provision

Total liabilities

Borrowings

Retirement benefit liability
Provisions(7)

Deferred tax liabilities
Other non-current liabilities

Net assets

EquityShareholders’ equity
Common stock

13,450––13,450Capital surplus

10,665–(558)

10,107(11)

Capital surplus

Retained earnings

212,703–(1,145)211,558

(12),
(13)

Retained earnings

Accumulated othercomprehensive income

14,845–925

15,770(12),(13)

Other components of equity

Treasury stock(10,931)––(10,931)

Non-controlling interests

240,733–(777)

Share capital

Treasury shares
Total equity attributable toowners of parent

239,955

1,895

–

68

1,963

Total net assets

242,629–(709)

241,919(13)

Total equity

Non-controlling interests

Total liabilities and net assets

342,973(1,119)8,378

350,231

Total liabilities and equity

17III. Reconciliation of Assets at End of Previous Fiscal Year (March 31, 2019)(Million yen)Account under Japanese GAAP

Japanese
GAAP

Difference due
to changes inrecognition,
Reclassification
measurement
and accounting
period

IFRS

Notes

AssetsAssetsCurrent assets

Current assets

Cash and deposits

35,351

196–

35,547

Notes and accounts
receivable – trade99,247113

1,137

100,497

–

1,599

109

1,709

Finished products

5,106(5,106)––Work in process

1,235(1,235)––

Raw materials and supplies

3,133(3,133)

–

–

–

9,474

(126)

9,348

Other

6,136

(2,570)

456

4,022

Allowance for doubtful
accounts

(659)

659

–

–

149,550–

1,575

151,125

Total current assets

Cash and cash equivalents(2)

Intangible fixed assets

Trade and other receivables
Other financial assets(2)

Inventories
Other current assets

Total current assets

Non-current assets
Property, plant andequipment

Account under IFRS

Non-current assets
109,669(109,669)–––

103,278(3)

103,275(3)

Property, plant and equipment(4)

Right-of-use assets(5)

Goodwill

–

6,391

5,835

12,226

53,958(53,958)–––

36,301

1,652

37,954–

17,656(140)

17,51522,203(22,203)

–

–

–

1,100

(144)

956

Intangible assets

Investments and other assets
Investment securities

Investments accounted forusing equity method–

26,8501,742

28,592(6)

Other financial assets

Deferred tax assets

7,929(1,119)

(6)

6,803

(7)

Deferred tax assets

Other

6,724

(6,724)

–

–

–

829

(613)

216

Allowance for doubtful
accounts

(149)

149

–

–

Total non-current assets

200,335(1,119)8,324

207,540

349,885(1,119)9,899

358,666

Total assets

Other non-current assets

Total non-current assets
Total assets

18

(Million yen)Account under Japanese GAAP

Japanese
GAAP

Difference due
to changes inrecognition,
Reclassification
measurement
and accounting
period

IFRS

Notes

Liabilities

Liabilities and equity

Current liabilities

Current liabilities

Notes and accounts payable– trade26,362(26,362)––

Accounts payable – other

19,737(19,737)–––

50,134(558)

49,576

–

385

–

385

–

–

1

1

–

1,176

2,641

3,818

Income taxes payable

5,890

–

(3)

5,887

Provision for bonuses

2,520(2,520)––

Other provision

1,158(1,158)

–

–

–

1,026

–

1,026

Other

12,403(2,942)

2,966

12,427

Total current liabilities

68,072–

5,050

73,122

5,250(5,250)

–

–

–

1,717

–

1,717

–

5,250

4,377

9,628

Trade and other payables
Borrowings
Other financial liabilities(4)

Net defined benefit liability
Provision

Lease liabilities
Income taxes payable

Provisions(8), (9)Other current liabilities
Total current liabilities

Non-current liabilities
Lease obligations

Account under IFRS

Non-current liabilities
Borrowings(4)

Lease liabilities

–

1,663

108

1,771

(11)

Other financial liabilities

16,648–(68)

16,580(10)Retirement benefit liability

359

(358)

490

491

Deferred tax liabilities
related to revaluation

1,119

(361)

95

854

Other

18,961(3,781)

205

15,38542,339(1,119)5,208

46,428

Total non-current liabilities

110,412(1,119)10,258

119,551

Total liabilities

Total non-current liabilities
Total liabilities

Provisions(7)

Deferred tax liabilities
Other non-current liabilities

Net assets

EquityShareholders’ equity
Common stock

13,450––13,450Capital surplus

10,665–(400)

10,265(11)

Capital surplus
Retained earnings
Other components of equity

Retained earnings
Accumulated othercomprehensive income
Treasury stock

Non-controlling interests

Share capital

220,234–(643)

219,590

(12),
(13)

4,187

–

651

4,838

(12),
(13)

(10,932)––(10,932)

237,604–(392)

237,212

Treasury shares
Total equity attributable toowners of parent

1,868

–

33

1,902

Total net assets

239,473–(358)

239,114(13)

Total equity

Non-controlling interests

Total liabilities and net assets

349,885(1,119)9,899

358,666

Total liabilities and equity

19IV. Reconciliation of Income in First Half of Previous Fiscal Year (from April 1, 2018 to September 30, 2018)(Million yen)Account under Japanese GAAP

Japanese
GAAPNet sales

128,587

Difference due
to changes inrecognition,
Reclassification
measurement
and accounting
period–(2,044)

IFRS

Notes

126,542(2)

Account under IFRSNet sales

Cost of sales

89,290–(1,961)

87,328(2), (4),Cost of sales(8)

Gross profit

39,297–(83)

39,213Gross profit

Selling, general andadministrative expenses

29,024–(742)

28,282(4), (5), Selling, general and(8)administrative expenses

–

753

(77)

676

Other income

–

3,471

3

3,475

Other expenses

Operating income

10,272(2,718)

578

8,132

Operating profit

Non-operating income

1,109(1,109)––Non-operating expenses

1,005

(754)

(251)

–

Extraordinary income

2,162

(0)

(2,162)–Extraordinary losses

2,885(2,885)

－

–

–

321

47

369

–

168

69

237

–

33

－

33

Income before income taxes

9,653

–

(1,355)

8,297

Income taxes

3,152

–

(603)

2,548

(6), (7) Income tax expense

Net income

6,500

–

(751)

5,749

Profit for the period

(15)

–

(11)

(26)

6,516

–

(740)

5,775

Profit attributable tonon-controlling interests
Profit attributable to owners ofparent(6)
Finance income(4)

Finance costs
Share of profit of investments
accounted for using equity
methodProfit before tax

Non-controlling interests
Owners of parent

Other comprehensive income

Other comprehensive income

Unrealized gains (losses) on
available-for-sale securities

1,242(1,242)––

Deferred gains (losses) onhedges

(89)

89

–

–

Foreign currency translation
adjustments

(131)

131

–

–

Remeasurements of defined
benefit plans, net of tax

(0)

0

–

–

Share of othercomprehensive income ofassociates accounted forusing equity method

(31)

31

–

–
Items that will not bereclassified to profit or loss

–

1,242

1,624

2,866

(6)

Net change in the fairvalue of financial assets
measured through othercomprehensive income

–

(0)

25

25

(10)

Remeasurements ofdefined benefit plans
Items that may bereclassified to profit or loss

–

(131)

(2,038)(2,169)Exchange differences ontranslation of foreign
operations

20

(Million yen)Account under Japanese GAAP

Japanese
GAAP–

Difference due
to changes inrecognition,
Reclassification
measurement
and accounting
period

(89)

(3)

IFRS

Notes

Account under IFRS

(92)

Cash flow hedges

–

(31)

10

(20)

Share of othercomprehensive income ofinvestments accounted forusing equity method

Total other comprehensive
income

989

–

(380)

609

Other comprehensive income,net of tax

Comprehensive income

7,490

–

(1,132)

6,358

Comprehensive income for theperiod21

V. Reconciliation of Income in Previous Fiscal Year (from April 1, 2018 to March 31, 2019)(Million yen)Account under Japanese GAAP

Japanese
GAAPNet sales

259,409

Difference due
to changes inrecognition,
Reclassification
measurement
and accounting
period–(2,078)

IFRS

Notes

257,331(2)

Account under IFRSNet sales

Cost of sales

176,663–(1,993)

174,670(2), (4),Cost of sales(8)

Gross profit

82,746–(84)

82,661Gross profit

Selling, general andadministrative expenses

58,420–(1,425)56,994(4), (5), Selling, general and(8)administrative expenses

–

1,091

(67)

1,024

Other income

–

6,908

(77)

6,831

Other expenses

Operating income

24,326(5,816)1,350

19,860Operating profit

Non-operating income

2,006(2,006)––

Non-operating expenses

2,413(2,162)(251)–

Extraordinary income

8,676

–

(8,676)–Extraordinary losses

5,063(5,063)

–

–

–

776

5

781

–

316

205

521

–

136

10

146

Income before income taxes

27,532–(7,264)

20,267

Income taxes

10,207–(1,927)

8,279(6), (7) Income tax expense

Net income

17,325–(5,337)

11,987

Profit for the period

1

–

(64)

(63)

17,323–(5,273)

12,050

Profit attributable tonon-controlling interests
Profit attributable to owners ofparent(6)
Finance income(4)

Finance costs
Share of profit of investments
accounted for using equity
methodProfit before tax

Non-controlling interests
Owners of parent

Other comprehensive income

Other comprehensive income

Unrealized gains (losses) on
available-for-sale securities(7,904)

7,904

–

–

Deferred gains (losses) onhedges

315

(315)

–

–

Foreign currency translation
adjustments(2,208)

2,208

–

–

Remeasurements of defined
benefit plans, net of tax

(3)

3

–

–

Share of othercomprehensive income ofassociates accounted forusing equity method

(46)

46

–

–
Items that will not bereclassified to profit or loss–

(7,904)6,860(1,044)(6)

Net change in the fairvalue of financial assets
measured through othercomprehensive income

–

(3)

(69)

(72)

(10)

Remeasurements ofdefined benefit plans
Items that may bereclassified to profit or loss–

(2,208)(2,384)(4,593)

Exchange differences ontranslation of foreign
operations

22

(Million yen)Account under Japanese GAAP

Japanese
GAAP–

Difference due
to changes inrecognition,
Reclassification
measurement
and accounting
period

315

(6)

IFRS

Notes

Account under IFRS

308

Cash flow hedges

–

(46)

(106)

(153)

Share of othercomprehensive income ofinvestments accounted forusing equity method

Total other comprehensive
income(9,848)–4,293(5,554)

Other comprehensive income,net of tax

Comprehensive income

7,476

–

(1,044)

6,432

Comprehensive income for theperiod23

VI. Notes on Reconciliation(i) Reclassification
Of the items that were included in Non-operating income, Non-operating expenses, Extraordinary income, and Extraordinary
losses under Japanese GAAP, finance-related items are reclassified as Finance income or Finance costs under IFRS, and the otheritems are reclassified as Other income, Other expenses or Share of profit of investments accounted for using equity method underIFRS.
(ii) Differences due to changes in recognition, measurement and accounting period(1) Reconciliation related to the unification of reporting periods
Under Japanese GAAP, if the reporting date of a subsidiary and that of the Company are different, consolidated financial
statements were prepared based on the financial statements of the subsidiary on the reporting date of the subsidiary. Under IFRS,
the reporting date of a subsidiary is made the same as that of the Company or a provisional financial closing is conducted on thesame reporting date as that of the Company unless that is impossible practically. This has resulted in a difference in each account.
(2) Reconciliation of revenue recognition
Under Japanese GAAP, if reliable estimates are available for the work completed in construction work, the percentage ofcompletion method is used, and the completed-contract method is used for other construction work. Under IFRS, under a contract
where control over goods or services is transferred to the customer over a certain period of time, revenue is recognized over theperiod regardless of the legal form of the contract.
(3) Reconciliation of property, plant and equipment
For certain property, plant and equipment, the Group applies an optional exemption where the fair value on the date of transition to
IFRS is used as a deemed cost.
(4) Reconciliation of leases
Under Japanese GAAP, an operating lease was expensed. Under IFRS, due to the adoption of IFRS 16, right-of-use assets andlease liabilities are posted.
(5) Reconciliation of goodwill
Under Japanese GAAP, goodwill was amortized over a certain period of time. Under IFRS, goodwill is not amortized. Goodwill
amortized under Japanese GAAP on or after the date of transition to IFRS is reversed.
(6) Reconciliation of other financial assets (non-current)
Under Japanese GAAP, unlisted shares were posted based on acquisition cost and impairment losses were recorded in accordancewith deterioration in the financial position of the issuing company. Under IFRS, unlisted shares are measured at fair value throughother comprehensive income. Loss (gain) on sale and impairment loss of financial instruments recognizable as capital arerecognized as profit or loss under Japanese GAAP. Under IFRS, changes in fair value are recognized as other comprehensive
income, and loss (gain) on sale and impairment loss are not recognized as profit or loss.
(7) Reconciliation of deferred tax assets and deferred tax liabilities
Under Japanese GAAP, the deferred method was employed for tax effects associated with the elimination of unrealizedintercompany profits. Under IFRS, the asset and liability method is employed. The recoverability of deferred tax assets is
examined under IFRS. Temporary differences have occurred due to adjustments associated to the transition from Japanese GAAP
to IFRS, and deferred tax assets and deferred tax liabilities have been adjusted accordingly.
(8) Reconciliation of unused paid leave
Under Japanese GAAP, no accounting process were required for unused paid leave. Under IFRS, the Group has recorded liabilities
related to unused paid leave.
(9) Reconciliation of other current liabilities
Under Japanese GAAP, expenses were recognized throughout a fiscal year when fixed assets tax etc. was paid. Under IFRS, theamount expected to be paid is recognized as liabilities when debts to the government are determined.
(10) Reconciliation of employees’ retirement benefits
Under Japanese GAAP, the Group recorded actuarial differences as expenses in a year or two, on a pro-rata basis, from the fiscal
year when the differences occurred. Under IFRS, actuarial differences are recognized in other comprehensive income when theyoccur and are transferred to retained earnings immediately. Prior service cost is recognized as profit or loss at the time ofoccurrence.
(11) Liabilities related to put option contracts for non-controlling interests
If the Group is required to buy the non-controlling interests of certain subsidiaries under certain conditions at the request of theshareholders of the non-controlling interests, financial liabilities are recognized and capital surplus is reduced under IFRS.

24

(12) Reconciliation of other components of equity
The Group has chosen an exemption set out in IFRS 1 and transferred all cumulative translation differences related to foreignsubsidiaries to retained earnings on the date of transition to IFRS, April 1, 2018.
(13) Reconciliation of retained earnings(Million yen)
Date of transition to
IFRS(April 1, 2018)

As of September 30,
As of March 31, 20192018

Reconciliation due to the unification ofreporting periods(Refer to (1))

(123)

―

―

Reconciliation of property, plant andequipment(Refer to (3))

(380)

(380)

(200)

Reconciliation of goodwill(Refer to (5))

―

824

1,643

Reconciliation of other financial assets(Refer to (6))

(207)

84

(52)

Reconciliation of unused paid leave(Refer to (8))(1,875)(1,875)(1,908)Reconciliation of other current liabilities (Refer to (9))

(161)

(154)

(154)

Reconciliation of employees’ retirement(Refer to (10))
benefits

225

225

104

Reconciliation of other components ofequity

(193)

(193)

(193)

Other

(Refer to (12))

(6)

(252)

(462)

(2,720)(1,721)(1,222)

Tax effect related to the adjustments
above and increase (decrease) in
non-controlling interests

576

576

579

Reconciliation of retained earnings(2,144)(1,145)(643)

Sum of reconciliations

VII. Reconciliation of Cash Flows
There is no significant difference between the consolidated statement of cash flows under the Japanese GAAP and the consolidated
statement of cash flows under IFRS.

25