The following information was originally prepared and published by the Company in Japanese as it contains timely disclosure materials to be submitted to the Tokyo Stock Exchange. This English
translation is for your convenience only. To the extent there is any discrepancy between this English translation and the original Japanese version, please refer to the Japanese version.

Summary of Financial Statements for the Fiscal Year Ended December 31, 2018
[IFRS] (Consolidated)
February 14, 2019
Broadleaf Co., Ltd.
Stock Listing: Tokyo Stock Exchange 1st Section
Representative: Kenji Oyama, Representative Director, President & CEO
Scheduled Date for Ordinary General Meeting of Shareholders: March 28, 2019
Scheduled Starting Date for Dividend Payment:
March 29, 2019
Scheduled Submission Date for Securities Report:
March 29, 2019
Earnings Supplementary Explanatory Documents:
Yes
Earnings Results Briefing:
Yes (For institutional investors and analysts)(Amounts are rounded down to the nearest million yen.)

1. Consolidated Financial Results for FY2018 (from January 1, 2018 to December 31, 2018)(1) Consolidated Results of Operations (Percentage below represents increase (decrease) from the same period of previous year)
Revenue

Operating profit

Millions ofYenMillions ofYen%

21,285 17.0
18,195 8.6

FY2018FY2017FY2017

Millions ofYen%

4,115 36.7
3,011 2.0

Basic earnings per
share
FY2018

Profit before tax%

Millions ofYen

4,105 37.3
2,989 2.3

Millions ofYen%

2,656 37.4
1,932 3.0

Return on equity
attributable to ownersof the parent

Diluted earnings per
share

Total
comprehensive
incomeProfit attributable toowners of parent

Profit% Millions of Yen

2,656 37.4
1,932 3.0

Return on assets%

2,713 39.0
1,952 4.0
Operating margin

Yen

Yen

%

%

%

30.36
21.81

30.15
21.80

13.0
9.9

14.3
11.2

19.3
16.5

(Reference) Share of (profit) loss of entities accounted for using equity Method

FY2018: -9 million yen
FY2017: -19 million yen(Note) The Company conducted a 2-for-1 common stock split effective April 1, 2018. The basic earnings per share and the diluted earnings per
share are calculated on the assumption that the said stock split was implemented at the beginning of the previous fiscal year.

(2) Consolidated Financial Position
Total assets

Percentage of equity
attributable to ownersof parent

Equity attributable toowners of parent

Total equity

Equity attributable toowners of parent per
share

Millions of Yen

Millions of Yen

Millions of Yen%

Yen

29,41328,063

21,033
19,737

21,033
19,73771.5
70.3

240.91222.90End of FY2018

End of FY2017(Note) The Company conducted a 2-for-1 common stock split effective April 1, 2018. The equity attributable to owners of parent per share is
calculated on the assumption that the stock split was implemented at the beginning of the previous fiscal year.

(3) Cash Flow Status
Operating activities

Investing activities

Cash and cash equivalents at
end of period

Financing activities

Millions of Yen

Millions of Yen

Millions of Yen

Millions of Yen

4,566
2,558

-2,496-2,072-2,409-2,251

5,627
5,970

FY2018FY2017

2. Dividends
Dividends Per Share

End of Q1

FY2017FY2018Year-end

Total Dividends(Annual)

Total

Ratio ofdividends toequityattributable toowners ofparent(Consolidated)

Dividend
Payout Ratio(Consolidated)

End of Q2

End of Q3

Yen

Yen

Yen

Yen

Yen

Millions of Yen

%

%

‒
‒
‒

11.00
5.50
6.50

‒
‒
‒

11.00
6.50
6.50

22.00
12.00
13.00

1,015
1,092

50.4
39.5
40.5

5.0
5.2

FY2019 (Forecast)(Note) The Company conducted a 2-for-1 common stock split effective April 1, 2018. The dividends in FY2017 are based on shares before thestock split.

3. Earnings Forecast for FY2019 (from January 1, 2019 to December 31, 2019)(Percentages below represent increases (decreases) from the same period of the previous fiscal year.)
Revenue
1st Half of FY2019
FY2019Operating profit

Profit attributable toowners of parent

Profit before tax

Basic earnings per
share

Millions of Yen%

Millions of Yen%

Millions of Yen%

Millions of Yen%

Yen

10,60022,000

5.1
3.4

1,700
4,500

10.2
9.4

1,700
4,500

9.8
9.6

1,000
2,800

0.2
5.4

11.45
32.07

- 1 -

* Notes(1) Changes in significant subsidiaries during the fiscal year ended December 31, 2018 (changes of specified subsidiaries
with change of the scope of consolidation): No(2) Changes in accounting policies, changes in accounting estimates
1. Changes in accounting policies required by IFRS: Yes
2. Other changes in accounting policies: No
3. Changes in accounting estimates: No(Note) For details, see “3. Consolidated Financial Statements and Major Notes, (5) Notes to consolidated financial
statements (Changes in accounting policies)” on page 13 of the attached material.
(3) Number of shares outstanding (common stock)
1. Number of shares outstanding (including
FY2018treasury stock)

97,896,800

FY2017

97,896,800

2. Number of shares of treasury stock

10,588,336

FY2017

9,348,136

FY20183. Average number of shares outstanding
87,482,212
88,570,939
FY2018FY2017(during the period)(Note) The Company conducted a 2-for-1 common stock split effective April 1, 2018. The number of shares
outstanding (common stock) is calculated on the assumption that the stock split was conducted at the
beginning of the previous fiscal year.
(Reference) Summary of nonconsolidated financial results
Nonconsolidated results of operations for FY2018 (from January 1, 2018 to December 31, 2018)(1) Nonconsolidated results of operations(Percentage below represents increase (decrease) from the same period of previous year)
Net sales
FY2018FY2017

Operating income

Ordinary income

Net income

Millions of Yen%

Millions of Yen%

Millions of Yen%

Millions of Yen%

19,013
17,220

10.4
2.2

3,498
2,749

27.3
23.4

3,507
2,745

27.8
23.1

2,023
1,479

36.8
29.4

Earnings per share

Diluted earnings per share

Millions of Yen

Millions of Yen

23.12
16.70

22.97

FY2018FY2017
16.69(Note) The Company conducted a 2-for-1 common stock split effective April 1, 2018. Net income per share and net income per share (fully
diluted) are calculated based on the assumption that the stock split was conducted at the beginning of the previous fiscal year.

(2) Nonconsolidated financial position
Total assets
FY2018FY2017(Reference) Shareholders’ equity

Net assets

Shareholders’ equity ratio

Net assets per share

Millions of Yen

Millions of Yen%

Yen

24,731
23,661

18,213
17,85073.6
75.4

208.60201.51FY2018: 18,213 million yen

FY2017: 17,843 million yen(Note) The Company conducted a 2-for-1 common stock split effective April 1, 2018. Net assets per share is calculated on the assumption thatthe stock split was conducted at the beginning of the previous fiscal year.

<Reason for differences from the nonconsolidated financial results of the previous fiscal year>
Net sales increased mainly because the Company focused its efforts on cultivating users’ demand for renewals in theBusiness Application Software domain in the fiscal year under review. As a result, there are differences between thefinancial results for the previous fiscal year and those for the fiscal year under review* Summaries of financial statements are outside the scope of audit procedures by certified public accountants and audit
firm.
* Comment regarding appropriate usage of earnings forecast, and other special notes(Note on forward-looking statements)
The forward-looking statements such as earnings forecasts contained in this document are based on the information
currently available to the Company and certain assumptions which are regarded as legitimate. The Company makes nowarranty as to the achievability of what is described in the statements. Actual results may differ from these forecasts due
to various factors.
(Availability of earnings supplementary explanatory documents and information on earnings results briefings)
The Company will hold a results briefing for institutional investors and analysts on Friday, February 15, 2019.
The video of this results briefing will be posted on the Company’s website.

- 2 -○Table of Contents of Attached Material
1. Overview of Results of Operations, Etc. ...............................................................................................................
(1) Overview of financial results in the fiscal year ended December 31, 2018 ....................................................
(2) Overview of financial position in the fiscal year under review ........................................................................
(3) Basic policy on profit distribution and dividends for FY2018 and FY2019......................................................

4
4
4
5

2. Basic Policy on the Selection of Accounting Standards ........................................................................................

6

3. Consolidated Financial Statements and Major Notes ...........................................................................................
(1) Consolidated statement of financial position ..................................................................................................
(2) Consolidated statement of income and consolidated statement of comprehensive income ..........................
Consolidated statement of income .................................................................................................................
Consolidated statement of comprehensive income........................................................................................
(3) Consolidated statement of changes in equity ................................................................................................
(4) Consolidated statement of cash flows ............................................................................................................
(5) Notes to consolidated financial statements ....................................................................................................
(Notes on going concern assumption) ...........................................................................................................
(Changes in accounting policies) ...................................................................................................................
(Segment information) ...................................................................................................................................
(Profit per share) ............................................................................................................................................
(Significant subsequent events) .....................................................................................................................

7
7
8
8
9
10
12
13
13
13
13
14
14

- 3 -

1. Overview of Results of Operations, Etc.
(1) Overview of financial results in the fiscal year ended December 31, 2018(i) Results of operations in the fiscal year ended December 31, 2018
In the fiscal year under review (from January 1, 2018 to December 31, 2018), the Company posted revenue of
21,285 million yen (up 17.0% year on year). This was a result of growth in sales revenue, primarily due to the factthat the sales revenue of the Company’s systems for auto maintenance factories and database provision service
has increased from the previous fiscal year, and the contribution of sales from Tajima Incorporated (“Tajima”), which
was consolidated in July 2017. Cost and expenses included cost of sales of 5,452 million yen (up 11.5% year onyear) and selling, general and administrative expenses of 11,751 million yen (up 14.1% year on year). This waschiefly attributable to an increase in the amount of goods purchased due to growing sales and an increase inpersonnel expenses and higher expenses required for shareholder incentives in addition to the impact of Tajima
above.
As a result, revenue in the fiscal year under review increased 17.0% year on year, to 21,285 million yen. In terms of
profits and losses, operating profit stood at 4,115 million yen (up 36.7% year on year), profit before tax came to4,105 million yen (up 37.3% year on year), and profit attributable to owners of parent amounted to 2,656 million yen(up 37.4% year on year).
The Company has a single business segment, which consists of IT services. A breakdown of sales by businessdomain is shown in the table below.
(Unit: Millions of yen)
DomainFY2017(From Jan. 1 to
Dec. 31, 2017)

FY2018(From Jan. 1 to
Dec. 31, 2018)

Year-on-year rate ofchangeBusiness Application Software

11,737

14,20621.0%

System Support

1,264

1,314

4.0%

Network Service

5,194

5,765

11.0%

Total

18,19521,28517.0%(ii) Outlook for the fiscal year ending December 31, 2019
With respect to consolidated results for the fiscal year ending December 31, 2019, the Company forecasts 22,000
million yen in revenue, 4,500 million yen in operating profit, 4,500 million yen in profit before tax and 2,800 million
yen in profit attributable to owners of parent.
The Company will move forward steadily with its efforts of renewing contracts with the users of existing systems
and acquiring new customers, while at the same time promoting overseas sales actively for OTRS®, its operation
analysis software. It also expects growth in the data provision service. In addition, the development of platforms,
the source of future growth, will be continued.
(2) Overview of financial position in the fiscal year under review(i) Assets, liabilities, and net assets
Total assets at the end of the fiscal year under review increased 1,350 million yen from the end of the previous
fiscal year, to 29,413 million yen (up 4.8% year on year). Current assets fell 782 million yen, to 10,619 million yen(down 6.9%), and non-current assets increased 2,131 million yen, to 18,794 million yen (up 12.8%). The decreasein current assets was mainly attributable to a decrease in operating and other receivables of 538 million yen. The
increase in non-current assets was caused primarily by a rise in intangible assets of 1,651 million yen.
Liabilities rose by 54 million yen from the end of the previous fiscal year, to 8,379 million yen (up 0.6% year onyear). Current liabilities increased 436 million yen, to 7,913 million yen (up 5.8%). Non-current liabilities declined
382 million yen, to 466 million yen (down 45.0%). The main factor contributing to the increase in current liabilities
was an increase in income tax payable of 436 million yen. The reduction in non-current liabilities was mainly
attributable to a decrease in long-term interest-bearing debt of 376 million yen.
Total equity rose 1,296 million yen from the end of the previous fiscal year, to 21,033 million yen (up 6.6% year onyear). The increase in total equity was chiefly attributable to an increase of 1,750 million yen in retained earnings.
As a result, the percentage of equity attributable to owners of parent rose 1.0 percentage points from 70.3% at theend of the previous fiscal year to 71.5%.

- 4 -(ii) Cash flows
Cash and cash equivalents (“cash”) at the end of the fiscal year under review declined 344 million yen from the endof the previous fiscal year, to 5,627 million yen. Net cash provided by operating activities stood at 4,566 million yen.
Net cash used in investing activities came to 2,496 million yen. Net cash used in financing activities was 2,409
million yen.
The following is a description of the situation and major factors of each category of cash flows in the fiscal year
under review.
(Cash flows from (used in) operating activities)
Net cash provided by operating activities stood at 4,566 million yen (up 78.5% year on year), reflecting profit before
tax of 4,105 million yen and depreciation and amortization expense of 844 million yen, which were partially offset byincome taxes paid of 1,216 million yen.
(Cash flows from (used in) investing activities)
Net cash used in investing activities came to 2,496 million yen (up 20.4% year on year), mainly due to theacquisition of intangible assets of 2,318 million yen.
(Cash flows from (used in) financing activities)
Net cash used in financing activities was 2,409 million yen (up 7.0% year on year), chiefly attributable to cash
dividends paid of 967 million yen, repayments of long-term loans payable of 653 million yen, and the purchase oftreasury shares of 1,006 million yen.
(For reference) Trends in cash flow-related data
FY2016FY2017FY2018Percentage of equity attributable to owners of parent (%)

75.7

70.3

71.5

Market value-based percentage of equity attributable toowners of parent (%)

112.3

165.3

158.2

Interest-bearing debt to cash flows (years)
Interest coverage ratio (times)

0.5

0.4

0.1

284.0

462.0

1,107.3

Percentage of equity attributable to owners of parent: Equity attributable to owners of parent/Total assets
Market value-based percentage of equity attributable to owners of parent: Market capitalization/Total assets
Interest-bearing debt to cash flows: Interest-bearing debt/Cash flows
Interest coverage ratio: Cash flows/Interest payments(Note 1) Market capitalization is calculated based on the number of issued shares less the number of shares oftreasury stock.
(Note 2) Cash flows are net cash provided (used in) operating activities.
(Note 3) Interest-bearing debt denotes all liabilities bearing interest of the liabilities posted on the consolidated
statement of financial position.
(3) Basic policy on profit distribution and dividends for FY2018 and FY2019
The Company positions returning profits to shareholders as an important management issue. Its basic policy issecuring internal reserves for future business development and the reinforcement of the management structure andcontinuing to distribute stable dividends. We aim for a payout ratio of approximately 20%.
To secure opportunities for returning profits to shareholders, we distribute dividends twice a year: interim dividends
and year-end dividends. Interim dividends are determined by the Board of Directors, and year-end dividends are
determined by the annual shareholders’ meeting. The Articles of Incorporation stipulate that by a resolution of theBoard of Directors, the Company may pay interim dividends to the shareholders or registered pledgees of shares
stated or recorded in the final shareholder registry on June 30 every year.
With respect to dividends for the fiscal year under review, we will pay an annual dividend of 12.0 yen, including theinterim dividend of 5.5 yen.
The Company forecasts that the dividend per share for the next fiscal year will be 13.0 yen (an interim dividend of
6.5 yen and a year-end dividend of 6.5 yen).
- 5 -2. Basic Policy on the Selection of Accounting Standards
The Group has decided to voluntarily apply the International Financial Reporting Standards (IFRS), replacing theJapanese GAAP, from the consolidated financial statements in the annual securities report for the fiscal year ended
December 31, 2016 to increase convenience for the stakeholders, including shareholders and investors in Japan andoverseas, by improving the international comparability of financial information and expanding the scope of disclosure.

- 6 -3. Consolidated Financial Statements and Major Notes(1) Consolidated statement of financial position(Unit: Thousands of Yen)FY2017(As of December 31, 2017)

FY2018(As of December 31, 2018)

5,970,318
4,984,981
128,353–
316,609
11,400,260

5,626,723
4,447,390
238,46130
306,121
10,618,726

424,747
11,739,040
2,982,588

442,641
11,739,040
4,633,235

57,07937,152

1,238,994
13,340206,881
16,662,670
28,062,930

1,405,853
115,372
420,864
18,794,156
29,412,881

Liabilities and Equity
Liabilities
Current liabilities
Operating and other payables
Contract liabilities
Short-term interest-bearing debt
Income taxes payable
Other current financial liabilities
Other current liabilities
Total current liabilities

5,595,736–
645,323
568,415
83,140584,924
7,477,539

3,623,665
1,616,791
378,551
1,004,527
72,8201,216,718
7,913,072

Non-current liabilities
Long-term interest-bearing debt
Net defined benefit liability
Non-current provisions
Deferred tax liabilities
Total non-current liabilities
Total liabilities

461,122
227,131
139,786
19,927
847,967
8,325,505

84,738196,345
133,207
52,097466,386
8,379,457

7,147,905
7,116,269-2,736,155
8,009,349
200,056
19,737,424
19,737,424
28,062,930

7,147,905
7,180,289-3,500,454
9,759,561
446,124
21,033,424
21,033,424
29,412,881

AssetsCurrent assets
Cash and cash equivalents
Operating and other receivables
Inventories
Other current financial assets
Other current assets
Total current assets
Non-current assets
Property, plant and equipment
Goodwill
Intangible assets
Investments accounted for using equity
methodOther non-current financial assets
Other non-current assets
Deferred tax assets
Total non-current assets
Total assets

EquityCapital stock
Share premium
Treasury shares
Retained earnings
Other components of equity
Total equity attributable to owners of parent
Total equity
Total liabilities and equity- 7 -(2) Consolidated statement of income and consolidated statement of comprehensive income
Consolidated statement of income(Unit: Thousands of Yen)FY2017(From January 1, 2017
to December 31, 2017)

FY2018(From January 1, 2018
to December 31, 2018)18,194,991-4,889,201
13,305,790-10,300,878
23,160-17,1713,010,901
15,517-18,041-18,923
2,989,455-1,057,351
1,932,104

21,285,103-5,451,763
15,833,340-11,750,826
57,054-25,057
4,114,511
12,252-12,367-9,153
4,105,244-1,449,621
2,655,622

Profit attributable to owners of parent

1,932,104

2,655,622

Earnings per share
Basic earnings per share (yen)Diluted earnings per share (yen)

21.81
21.80

30.36
30.15

Revenue
Cost of sales
Gross profit
Selling, general and administrative expenses
Other operating income
Other operating expense
Operating profit
Finance income
Finance cost
Equity in loss of affiliates
Profit before tax
Income tax
Profit- 8 -Consolidated statement of comprehensive income(Unit: Thousands of Yen)FY2017(From January 1, 2017
to December 31, 2017)
ProfitOther comprehensive income
Components that will not be reclassified to profit orloss
Net change in fair value of financial assets ofequity nature measured at fair value throughother comprehensive income
Remeasurements of defined benefit plans
Total components that will not be reclassified
to profit or loss
Components that may be reclassified to profit or loss
Exchange differences on translation of foreign
operations
Share of other comprehensive income ofassociates accounted for using equity method
Total components that may be reclassified to
profit or loss
Total other comprehensive income, net of tax
Comprehensive income
Comprehensive income attributable to owners ofparent- 9 -FY2018(From January 1, 2018
to December 31, 2018)

1,932,104

2,655,622

15,861

61,128

2,056

9,053

17,91770,181-6,210-8,270

7,732-4,774

1,521-13,044

19,43857,136

1,951,542

2,712,759

1,951,542

2,712,759

(3) Consolidated statement of changes in equity
FY2017 (From January 1, 2017 to December 31, 2017)(Unit: Thousands of Yen)
Equity attributable to owners of parent
Capital stock
Balance as of January 1, 2017

Share premium

Treasury shares

Retained earnings

7,147,905

7,114,654-2,252,885

7,136,345

Profit

–––1,932,104

Other comprehensive income

–

–

–

–

–

–

–

1,932,104–

Total comprehensive income
Purchase of treasury shares––-530,475

Disposal of treasury shares–

557

47,205–

Dividend–––-1,049,308

Reclassification from sharepremium to retained earnings

–

1,058

–

-1,058

Share-based paymenttransactions

–

–

–

–

Reclassification from othercomponents of equity to retained
earnings–––-8,968Other changes

–

–

–

234

–

1,615

-483,270-1,059,100

7,147,905

7,116,269-2,736,155

8,009,349

Total transactions with owners
Balance as of December 31, 2017

(Unit: Thousands of Yen)
Equity attributable to owners of parent
Other components of equity
Net change infair value of
Exchange financial assets
differences on of equity nature Remeasuremetranslation of measured at nts of definedforeignfair value
benefit plans
operations
through othercomprehensive
incomeWarrants

Balance as of January 1, 2017

Total equity

Total

Total

7,383

-37,586

43,370–13,167

19,159,187

19,159,187

Profit

–

–

–

–

–

1,932,104

1,932,104

Other comprehensive income

–

1,521

15,861

2,056

19,43819,43819,438–

1,521

15,861

2,056

19,438

1,951,542

1,951,542

Purchase of treasury shares

–

–

–

–

–

-530,475-530,475

Disposal of treasury shares

-80

–

–

–

-80

47,682

47,682

Dividend

–

–

–

–

–

-1,049,308-1,049,308

Reclassification from sharepremium to retained earnings

–

–

–

–

–

–

–

158,797–––

158,797

158,797

158,797––

11,024-2,056

8,968

–

–

Total comprehensive income

Share-based paymenttransactions
Reclassification from othercomponents of equity to retained
earnings

-234

–

–

–

-234

–

–

Total transactions with owners

Other changes

158,483–

11,024-2,056

167,451-1,373,304-1,373,304

Balance as of December 31, 2017

165,866-36,065

70,255–200,056

19,737,424

19,737,424- 10 -

FY2018 (From January 1, 2018 to December 31, 2018)(Unit: Thousands of Yen)
Equity attributable to owners of parent
Capital stock

Share premium

Treasury shares

Retained earnings

Balance as of January 1, 2018

7,147,905

7,116,269-2,736,155

8,009,349

Accounting policy changes

–

–

–

52,729Balances after restatement ofmodifications

7,147,905

7,116,269-2,736,155

8,062,078

Profit–––2,655,622

Other comprehensive income

–

–

–

–

–

–

–

2,655,622–

Total comprehensive income
Purchase of treasury shares––-1,005,603

Disposal of treasury shares–

64,020241,303–

Dividend–––-967,192

Share-based paymenttransactions

–

–

–

–

Reclassification from othercomponents of equity to retained
earnings

–

–

–

9,053

Other changes

–

–

–

–

–

64,020-764,300-958,139

7,147,905

7,180,289-3,500,454

9,759,561

Total transactions with owners
Balance as of December 31, 2018

(Unit: Thousands of Yen)
Equity attributable to owners of parent
Other components of equity
Net change infair value of
Exchange financial assets
differences on of equity nature Remeasuremetranslation of measured at nts of definedforeignfair value
benefit plans
operations
through othercomprehensive
incomeWarrants

Total equity

Total

Total

Balance as of January 1, 2018

165,866-36,065

70,255–200,056

19,737,424

19,737,424

Accounting policy changes

–

–

–

–

–

52,72952,729Balances after restatement ofmodifications

165,866-36,065

70,255–200,056

19,790,153

19,790,153
2,655,622

Profit

–

–

–

–

–

2,655,622

Other comprehensive income–-13,044

61,128

9,053

57,136

57,136

57,136–-13,044

61,128

9,053

57,1362,712,759

2,712,759

Purchase of treasury shares

–

–

–

–

–

-1,005,603-1,005,603

Disposal of treasury shares-8,829–––-8,829296,494

296,494

–

–

–

–

–

-967,192-967,192

211,682–––

211,682

211,682

211,682–––-9,053-9,053––

Total comprehensive income

Dividend
Share-based paymenttransactions
Reclassification from othercomponents of equity to retained
earnings-4,868–––-4,868-4,868-4,868

Total transactions with owners

Other changes

197,985––-9,053

188,932-1,469,488-1,469,488

Balance as of December 31, 2018363,850-49,109131,383–

446,124

21,033,424

21,033,424- 11 -

(4) Consolidated statement of cash flows(Unit: Thousands of Yen)FY2017(From January 1, 2017
to December 31, 2017)
Cash flows from operating activities
Profit before tax
Depreciation and amortization expense
Impairment loss
Share-based compensation expenses
Finance income and costs
Equity in loss (earnings) of affiliates
Decrease (increase) in operating and otherreceivables
Decrease (increase) in inventories
Increase (decrease) in operating and otherpayablesIncrease (decrease) in accrued expenses
Increase (decrease) in employees’ bonuses
payableIncrease (decrease) in contract liabilities
Increase (decrease) in consumption taxes
payableOther, net
SubtotalInterest received
Dividends received
Interest expenses paid
Income taxes (paid) refund
Cash flows from (used in) operating activities
Cash flows from investing activities
Acquisition of property, plant and equipment
Proceeds from sales of property, plant andequipment
Acquisition of intangible assets
Acquisition of investments
Purchase of shares of subsidiaries resulting inchange in scope of consolidation
Payments for lease and guarantee deposits
Proceeds from collection of lease and guarantee
deposits
Other, net
Cash flows from (used in) investing activities
Cash flows from financing activities
Repayments of long-term loans payable
Repayments of lease obligations
Cash dividends paid
Purchase of treasury shares
Proceeds from sales of treasury shares
Other, net
Cash flows from (used in) financing activities
Impact of exchange fluctuations for cash and cash
equivalents
Net increase (decrease) in cash and cash
equivalents
Cash and cash equivalents at beginning of period
Balance of cash and cash equivalents at end of
period- 12 -FY2018(From January 1, 2018
to December 31, 2018)

2,989,455
678,591
9,900
158,797
2,523
18,923

4,105,244
844,193–
206,814114
9,153-362,055

532,973

62,248-110,324-333

138,805-63,051

185,164

119,646

396,397–-513,761

48,84823,69961,887
3,725,380
1,992
3,098
-5,536-1,167,155
2,557,778-36,651
5,781,820
1,698
3,194
-4,124-1,216,297
4,566,291-43,673-88,996

50,407–-1,226,809-15,000-2,317,835-113,550-865,414–-12,917-30,408

34,54029,656

6,603-2,072,263

25,120-2,496,013-667,850-46,130-1,049,308-530,475
47,682-4,500-2,250,582-653,350-59,559-967,192-1,005,603
296,494-19,500-2,408,710-2,821-5,163-1,767,888-343,594

7,738,206

5,970,318

5,970,318

5,626,723

(5) Notes to consolidated financial statements(Notes on going concern assumption)
Not applicable.
(Changes in accounting policies)
Starting from the fiscal year under review, the Group adopted IFRS 15 “Revenue from Contracts with Customers”(announced in May 2014) and “Clarifications to IFRS 15” (announced in April 2016) (collectively, “IFRS 15”).
According to transitional provisions, the Group adopts IFRS 15 retroactively and recognizes cumulative effects of
the adoption since the commencement thereof as corrections to the balance of retained earnings at the beginningof the consolidated fiscal year under review.
Due to the application of IFRS 15, the Group recognizes revenue by applying the following five steps, excludinginterest, dividend income, etc. based on IFRS 9 “Financial Instruments.”
Step 1: Identify the contract with a customer.
Step 2: Identify the performance obligations in the contract.
Step 3: Determine the transaction price.
Step 4: Allocate the transaction price to the performance obligations in the contract.
Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation.
Pursuant to the above, the Group recognizes revenue as it satisfies performance obligations in the contracts withcustomers at a certain point or for a certain period.
The Group recognizes the portion of an increase in the costs for obtaining contracts with customers that is
expected to be recoverable as assets (referred to as “assets recognized from the costs for obtaining a contract witha customer” below). An increase in costs for obtaining a contract with a customer is a cost incurred for theacquisition of a contract with a customer, which would have not arisen without the acquisition of such a contract.
Assets recognized from the costs for obtaining a contract with a customer are written down in equal amounts over
five years according to the estimated term of a contract with a customer.
As a result, other non-current assets and retained earnings increased 76,000 thousand yen and 52,729 thousand
yen, respectively, while deferred tax assets decreased 23,271 thousand yen, compared to those calculated basedon the previous accounting standards, in the consolidated statement of financial position at the beginning of the
fiscal year under review. The impacts of such changes on profitability is immaterial in the consolidated statement ofincome for the fiscal year under review compared to those calculated based on the previous accounting standards.
Also, due to the adoption of IFRS 15, advance payments from customers that had previously been included inoperating and other payables were stated as contract liabilities in the fiscal year under review.
As a result, contract liabilities increased 1,616,791 thousand yen, while operating and other payables decreased by
the same amount compared to those calculated based on the previous accounting standards, in the consolidated
statement of financial position at the end of the fiscal year under review. In the statement of cash flows, increases
and decreases in operating and other payables rose 513,761 thousand yen, while increases and decreases incontract liabilities declined by the same amount.
(Segment information)(1) Overview of the reportable segments
The Group provides its customers with industry-specific business applications through networks, maintenanceservice and supplies, and various network services on the Industrial Platform mainly in the automotive aftermarket
industry. The Group develops business in a single-segment of an IT service business to the business fields ofbusiness application software, system support, and network service.
(2) Segment income and results
Since the Group has only a single business segment, the statement is omitted.

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(Profit per share)
Basic earnings per share and diluted earnings per share and the basis of their calculation are as follows.
FY2017FY2018(From January 1, 2017
(From January 1, 2018
to December 31, 2017)
to December 31, 2018)
Profit attributable to owners of parent (thousand yen)

1,932,104

2,655,622––

Diluted profit attributable to owners of parent (thousand
yen)

1,932,104

2,655,622

Average number of common shares during the period(shares)

88,570,939

87,482,212

48,51353,424–537,182

88,619,452

88,072,818

Basic earnings per share (yen)

21.81

30.36

Diluted earnings per share (yen)

21.80

30.15

Adjustment to profit (thousand yen)

Impact of dilutive common shares with dilutive effects
Warrants (shares)
Stock benefit trust (shares)
Diluted average number of common shares during theperiod (shares)(Notes) 1. In the previous fiscal year, warrants of stock options granted in 2014 (1,772 warrants) are not includedin the calculation of diluted earnings per share because these warrants do not have dilutive effects.
2. The Company conducted a 2-for-1 common stock split effective April 1, 2018. Basic earnings per
share and diluted earnings per share are calculated on the assumption that the common stock split
was conducted at the beginning of the previous fiscal year.
(Significant subsequent events)
Not applicable.

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