Non-consolidated Financial and Operating Results
for the Six Months Ended September 30, 2005
November 14, 2005
Company name
NAFCO Corporation
Code number2790(URL: http://www.nafco.tv)
Representative:
Contact person:(responsible for theannouncement)

Listed on
Head office location

JASDAQ
Fukuoka Prefecture

Katsuyoshi Fukamachi, President and CEO
Kanji Muraoka, Managing Director & General Manager, Accounting Division
TEL +81-93-521-7030

Date of board meeting for approval of accounts: November 14, 2005
Date for starting payment of interim dividends: December 9, 2005
Unit share system is applied (one unit is equal to 100 shares).
Interim dividend system is applied.
1. Financial and Operating Results for the Six Months Ended September 30, 2005 (April 1, 2005 throughSeptember 30, 2005)(1) Operating results
Note: Amounts below one million yen are truncated.
Net sales
Operating income
Ordinary income
Millions of yen% Millions of yen% Millions of yen%
Six months ended
September 30,
96,177[3.1]
6,683[41.6]
6,858[39.3]
2005
Six months ended
September 30,
93,266[3.5]
4,721[(16.8)]4,922[(16.4)]
2004
Year ended March
185,094
10,800
11,22931, 2005
Net income
Millions of yen [%]Net income per share
Yen

Diluted net income per share
Yen

Six months ended
3,490 [38.6]
117.52117.30
September 30,
2005
Six months ended
2,518 [(17.4)]
84.95
84.69
September 30,
2004
Year ended March
6,116
205.12204.5231, 2005
Notes:(1) Equity gain (loss) under equity method: − (September 2005, six months) − (September 2004, sixmonths) − (March 2005, year)(2) Average number of shares outstanding: 29,697,733 (September 2005, six months) 29,644,400 (September
2004, six months) 29,644,400 (March 2005, year)(3) Any change in the method of accounting: Yes(4) The above percentages in net sales, operating income, ordinary income, and net income for six months
represent the rates of year-over-year changes.

1(2) Dividends

Six months ended
September 30, 2005
Six months ended
September 30, 2004
Year ended March 31,2005

Interim dividend
per share

Total yearly
dividend

Yen

Yen

13.00

-

12.50

--

25.00

(3) Financial position
Total assets

Note: Amounts below one million yen are truncated.
Ratio of shareholders’ Shareholders’ equity
Shareholders’ equity
equityper share
Millions of yen%
Yen

Millions of yen
Six months ended
138,944
80,50657.9
2,708.42
September 30, 2005
Six months ended
132,650
74,01255.8
2,496.66
September 30, 2004
Year ended March 31,
135,083
77,26257.2
2,605.08
2005
Notes:(1) Number of shares issued at the end of the term: 29,724,400 (September 2005, six months) 29,644,400(September 2004, six months) 29,644,400 (March 2005, year)(2) Number of treasury shares held at the end of the term: − (September 2005, six months) − (September
2004, six months) − (March 2005, year)(4) Cash flows
Cash flows fromoperating activities
Millions of yen
Six months ended
September 30, 2005
Six months ended
September 30, 2004
Year ended March31, 2005

Note: Amounts below one million yen are truncated.
Cash and cash
Cash flows from
Cash flows fromequivalents at the end
investing activities
financing activitiesof the term
Millions of yen
Millions of yen
Millions of yen

3,723(5,178)

(849)

9,049

1,550

(3,004)(1,662)

12,6886,171(7,088)(3,534)

11,354

2. Projected Operating Results for the Year Ending March 31, 2006 (April 1, 2005 through March 31, 2006)
Note: Amounts below one million yen are truncated.
OrdinaryNet sales
Net income
Yearly dividend per shareincomeYear-end Yen
Millions of yen
Millions of yen Millions of yen
Yen
13.00
Full year
193,000
12,7176,760
26.00
Reference: Projected net income per share for the year ending March 31, 2006 (Full-year): ¥227.42
Note: An increase in the number of shares may be caused by execution of stock acquisition rights and is notconsidered in estimating yearly dividend per share.
Note: The aforementioned projections are based on information available at the date when this document wasreleased. Changing business conditions may cause actual results to differ from the above forecasts.

2

Financial Statements(1) Balanced Sheet

Account item

(Millions of yen)Six months in the previous
Six months in the current
fiscal year
fiscal year
(As of September 30, 2004) (As of September 30, 2005)
ComposiComposiAmountAmounttion ratiotion ratio％

The previous fiscal year
ended March 31, 2005
Amount％Composition ratio％（Assets）
I. Current Assets
Cash and bank deposits

15,48013,243

14,222

Accounts receivable―trade

1,020

1,098

1,330

Inventories

37,85041,48639,787

Current assets , other

1,603

1,683

1,602

Allowance for doubtful account

(14)

(18)

(14)

Total current assets

55,94042.2

57,493

41.4

56,92942.1

II. Fixed Assets
Property, plant and equipment
Buildings

29,757

31,82830,454Land

29,612

31,38929,931

Fixed assets, other

5,878

6,198

6,216

Total property, plant andequipment

65,24869,41566,602Intangible assets

1,251

1,2941,265

Total investments and other assets

10,21010,74010,287

Total fixed assets

76,71057.8

81,45058.6

78,154

57.9

Total assets

132,650

100.0

138,944100.0

135,083

100.0

3

(Millions of yen)Account item

Six months in the previous
Six months in the current
fiscal year
fiscal year
(As of September 30, 2004) (As of September 30, 2005)
ComposiComposiAmountAmounttion ratiotion ratio％

The previous fiscal year
ended March 31, 2005
Amount％Composition ratio％

Liabilities
I. Current Liabilities
Trade notes payable

16,321

17,31916,243Trade accounts payable

11,721

11,691

12,320

Short-term borrowings

7,330

6,730

6,730

Long-term borrowings, current
portion

2,778

2,726

2,844

Income taxes payable

2,600

3,360

3,350

Reserve for bonuses

993

1,016

891

Construction notes payable

3,079

3,232

2,034

Current liabilities, other

4,306

4,039

4,713

Total current liabilities

49,12837.0

50,11536.1

49,128

36.4

II. Fixed Liabilities
Long-term borrowings

4,937

3,521

3,969

Liability for retirement benefits

2,968

3,183

3,096

Reserve for officers retirement

1,356

1,387

1,388

246

229

238

Fixed liabilities, otherTotal fixed liabilities

9,509

7.2

8,322

6.0

8,692

6.4

Total Liabilities

58,63844.2

58,43742.1

57,82142.8

4

(Millions of yen)Account item

Six months in the previous
Six months in the current
fiscal year
fiscal year
(As of September 30, 2004) (As of September 30, 2005)
ComposiComposiAmountAmounttion ratiotion ratio％

The previous fiscal year
ended March 31, 2005
Composition ratio

Amount％％Shareholders’ Equity
I. Capital Stock

3,461

2.6

3,505

2.53,461

2.6

4,146

3.1

II. Capital Surplus
Capital reserve

4,146

Total capital surplus

4,190
4,146

3.1

4,146
4,190

3.0

III. Retained Earnings
Legal reserve

37

37

37

Voluntary reserve

61,197

66,197

61,197

Inappropriateed retained
earnings

5,129

6,441

8,357

Total retained earnings

66,36450.1

72,675

52.3

69,592

51.5

40

0.0

134

0.1

62

0.0

Total shareholders’ equity

74,01255.8

80,50657.9

77,262

57.2

Total liabilities and shareholders’equity132,650

100.0

138,944100.0

135,083

100.0

IV. Appreciation by Revaluation ofInvestment Securities

5(2) Statements of Income(Millions of yen)Six months in the current
fiscal year
（From April 1, 2005
to September 30, 2005）

Six months in the previous
fiscal year
(From April 1, 2004
to September 30, 2004)
Account item

Percentage

Amount

The previous fiscal year
（From April 1, 2004
to March 31, 2005）

Percentage

Amount％Percentage

Amount％％I. Net Sales

93,266100.0

96,177100.0

185,094

100.0

II. Cost of Sales

66,02370.8

66,48969.1

129,477

70.0

Gross profit

27,24329.2

29,68830.955,616

30.0

III. Selling, General and
Administrative Expenses

22,52224.1

23,00423.9

44,816

24.2

Operating Profit

4,721

5.1

6,683

7.0

10,800

5.8

IV. Nonoperating Income

361

0.4

374

0.3

765

0.4

V. Nonoperating Expenses

160

0.2

199

0.2

335

0.1

4,922

5.3

6,858

7.1

11,229

6.1

VI. Extraordinary Income

57

0.1

――

195

0.0

VII. Extraordinary Losses

71

0.1

388

0.4

255

0.1

4,909

5.3

6,470

6.7

11,169

6.0

5,052

2.7

6,116

3.3

Ordinary profit

Income before income taxes
Income taxes—current

2,337

Income taxes—deferred

53

3,145
2,390

2.6

Net Income

2,518

2.7

Unapproriated retained
earnings brought forward

2,610

2,950

2,610―

―

370

5,129

6,441

8,357

Interim dividends
Unappropriated retained
earnings

(165)

5,093

6

2,979

3.1

3,490

3.6

(41)

(3) Statement of Cash Flows（Millions of yen）
The previous fiscal
Six months in theSix months in theyear
current fiscal year
previous fiscal year
（From April 1,（From April 1, 2005
(From April 1, 2004
2004 to March 31,
to September 30, 2004) to September 30, 2005）
2005）
Account item

AmountAmountAmountI. Cash Flows from Operating Activities
Income before income taxes
Depreciation and amortization
Impairment loss on fixed assets
Amortization of intangible assets
Amortization of long-term prepaid expenses
Loss on retirement of tangible fixed assets
Gain on sale of tangible fixed assets
Loss on retirement of intangible fixed assets
Loss on retirement of investment assets and other
Increase in allowance for doubtful account
Increase in reserve for employees’ retirement
benefits
Increase (decrease) in reserve for directors’
retirement allowances
Increase (decrease) in reserve for bonuses4,909
1,437―
69
37
33(27)
0―
―

6,470
1,475
185
65
39
12―
―
1
4

11,169
3,024
―
137
75
54(27)
―
――

116

87244

31

(1)

62

43

125

(59)

Dividend and interest income

(11)

(18)

(17)

138
―
(232)
(139)
(1,370)(89)(163)
69(36)
4,816
6(134)(3,137)
1,550

117
―
(332)
(1,699)
446
(57)
(27)
16(36)
6,872
15(112)(3,051)
3,723

263
6
16(2,076)
(847)
(11)
(61)
(329)
(36)
11,58812(285)(5,143)6,171(2,760)41(138)(30)(3,448)―(94)(5)(6,616)43(219)
(30)

(152)

(216)

(294)

1875

109

17(1,489)(79)(3,004)(5,178)(7,088)Interest expense
Loss on devaluation of investment securities
Decrease (increase) in trade receivables
Increase in inventories
Increase (decrease) in trade payables
Decrease in consumption taxes payable
Increase in other assets
Increase (decrease) in other liabilities
Bonuses to directors paid
SubtotalInterest and dividends received
Interest paid
Income taxes paid
Net cash provided by operating activities
II. Cash Flows from Investing Activities:
Payments for acquisition of tangible fixed assets
Proceeds from sale of tangible fixed assets
Payments for acquisition of intangible assets
Payments for purchase of investment securities
Payments for leasehold deposits and guarantee
money
Proceeds from collection of leasehold deposits
and guarantee money
Decrease (increase) in other investments
Net cash used in investing activities

7

（Millions of yen）
Six Months in the
The previous fiscal
Six months in thecurrent fiscal year
year
previous fiscal year
(From April 1, 2004 （From April 1, 2005 （From April 1, 2004
to September 30, 2004) to September 30, 2005） to March 31, 2005）
Account item

AmountIII. Cash Flows from Financing Activities:
Decrease in short-term borrowings
Proceeds from long-term debt
Payments for repayment of long-term debt
Proceeds from issuance of shares

AmountAmount(690)
1,110(1,342)――
1,000(1,566)
88(1,290)
1,710(2,843)―

Cash dividends paid

(740)

(370)

(1,110)Net cash used in financing activities(1,662)(849)(3,534)

IV. Net decrease in cash and cash equivalents(3,115)(2,304)(4,450)V. Cash and cash equivalents at beginning of term

15,804

11,35415,804

12,6889,049

11,354

VI. Cash and cash equivalents at the end of term8