SHL-JAPAN Ltd.
Year Ending September 2014
Non-consolidated Financial and Operating Results (Excerpt) for the First Quarter EndedDecember 31, 2013 (J-GAAP basis)
February 7, 2014

 Registered on Tokyo Stock Exchange

Listed Company Name: SHL-JAPAN Ltd.
Securities Code4327

URL:

http://www.shl.co.jp/

Representative:

Manabu Nara, Managing Director

Contact:

Naohiro Nakamura, Executive Director

Date to submit the Quarterly Securities Report:

February 14, 2014

Date to start distributing dividends:-TEL:+81-3-5385-8781

The original disclosure in Japanese was released on January 30, 2014 at 15:15 (GMT+9)

Qualitative information regarding the quarterly settlement of accounts(1) Explanation of Operating Results
During the first quarter of the year ending September 30, 2014 (October 1, 2013, throughDecember 31, 2013), net sales of SHL-JAPAN Ltd. (the “Company”) increased ¥31 million, or
11.0%, year over year to ¥313 million. By business segment, “Product sales” increased 11.8% to¥138 million and “Consultancy sales” increased 10.8% to ¥171 million, whereas “Training sales”
decreased 8.4% to ¥3 million. A major contributor to the year-over-year increase in net sales forthe first quarter was favorable sales of our products and consulting services overall.
The Company is confident that the increase in revenue for the first quarter was mainly
attributable to our aggressive marketing activities that fit well with customers’ needs in view ofthe positive posture of corporations toward employment. The media has reported an increase forthree consecutive years in the informal job offer rate for expected university graduates andanticipates an annual increase in the number of new graduates to be employed next year, against abackdrop of general expectations of economic recovery.
Operating income for the quarter under review increased 29.3% year over year to ¥48 million.
The cost of goods sold rose ¥11 million, or 25.9%, year over year to ¥55 million, and selling,
general and administrative expenses increased ¥8 million, or 4.4%, year over year to ¥209 million.
However, operating income increased ¥10 million year over year due to the increase in revenue.
The increase in the cost of goods sold was primarily attributable to an increase in the amortization
cost for product masters of newly developed software that was completed during the previous
fiscal year and an increase in subcontract cost associated with the increase in revenue. The
increase in selling, general and administrative expenses was mainly attributable to theSHL-JAPAN Ltd.
year-over-year increase of ¥11 million in labor costs largely due to the expansion of sales
personnel despite decreases in several account items such as research and development expenses
and sales promotion-related expenses.
Ordinary income for the quarter under review increased ¥10 million, or 28.9%, year over yearto ¥48 million. This figure was almost the same as operating income because both non-operating
income and non-operating expenses were small.
Income before income taxes for the quarter under review totaled ¥49 million (down 39.6% year
over year). Income before income taxes decreased ¥32 million year over year, reflecting
year-over-year decreases of ¥50 million in extraordinary gains and ¥7 million in extraordinary
losses. The decrease in extraordinary gains was primarily due to the recording of ¥52 million ininsurance income arising from the passing of a Director despite the recording of ¥1 million for thesame period a year earlier as reversal of allowance for doubtful accounts for golf clubmemberships. The decrease in extraordinary losses was primarily due to the recording of ¥7
million in directors’ retirement benefits for the same period a year earlier.
After taking into account the above factors and income taxes—current and incometaxes—deferred, net income for the quarter under review decreased ¥18 million, or 38.1%, year
over year to ¥30 million.
(2) Explanation about future prospects such as business forecastsGiven the forward-looking posture of corporations toward employment, the domestic market forscreening and employment is anticipated to be increasingly buoyant in the second and subsequent
quarters.
We intend to continue increasing our operating performance through enhanced efforts tostrengthen our business quality for the purpose of speedily providing optimum services based on ourprecise analysis of corporate needs.
Under the recognition described above and based on our analysis of the operating results, financial
position and other managerial administrative data for the first quarter ended December 31, 2013,
followed by our careful consideration of business forecasts, the Company is not at this time revising
its financial forecast for the year ending September 30, 2014, which was released on October 25,2013.

SHL-JAPAN Ltd.

* Implementation status of quarterly review proceduresThis financial results summary is not subject to quarterly review procedures under the Financial
Instruments and Exchange Act, and the quarterly financial statement review procedures based on theAct were in progress at the time of the disclosure of these financial results.

* The forward looking statements regarding financial results forecasts, etc. appearing in this financial
results summary have been prepared based on information currently available to the Company andcertain assumptions that the Company believes to be reasonable. The Company makes no guarantees
as to their realization. Actual financial results may differ substantially from the forecasts due tovarious factors.

* As the Company’s services are often used for the screening of new graduates to be employed bycorporate customers, our sales inevitably involve seasonal fluctuations. In recent years, our saleshave tended to be concentrated in the second quarter, during which screening for employment of new
graduates is often conducted by many corporate customers. However, the actual timing for thescreening and employment of new graduates varies depending on the year. Accordingly, we have notpresented cumulative performance forecasts for the first two quarters.