Consolidated Financial Results for the First Quarter Ended June 30, 2017
Asahi Holdings, Inc. [IFRS]July 28, 2017

Stock code:
Shares listed:

5857
Tokyo Stock Exchange (First Section)

URL:
Representative

http://www.asahiholdings.com
Mitsuharu Terayama, President & CEO

For further information please contact:

Masaharu Sawada, Corporate Planning & Communications
Department General Manager

Filing date of Quarterly Report:(Phone) +81-3-6270-1833
August 10, 2017

Start of dividend payment:
Supplementary materials for the financial results:–
No

Investor conference for the financial results:

No(Rounded down to the nearest million yen)
1. Results of the three months ended June 30, 2017 (From April 1, 2017 to June 30, 2017)(1) Results of operations (cumulative)(Percentage: Changes relative to corresponding previous period)
OperatingincomeProfit before
tax

ProfitProfitattributable toowners of parent

Total
comprehensive
income%Millions of yen %Millions of yen %Millions of yen %Millions of yen %Millions of yen %32,476 16.8
27,800 (14.4)

3,491 32.0
2,645 (6.7)

3,402 35.2
2,517 (11.8)

2,381 25.8
1,893 (3.7)

2,343 24.7
1,879 (2.1)

Revenue
The three months ended
June 30, 2017
June 30, 2016

Millions of yen

Basic earnings per share

Diluted earnings per share

Yen
71.89
57.64

Yen
−
−

The three months ended
June 30, 2017
June 30, 2016

1,610 −
127 (96.1)(2) Financial Position

As ofJune 30, 2017
March 31, 2017

Total assets

Total equity

Equity attributable toowners of parent

Equity attributable toowners of parent ratio

Millions of yen
88,76088,976

Millions of yen
45,46944,827

Millions of yen
44,90444,303

50.6
49.8

%

2. Dividend payments
Dividends per share

Year ended March 31, 2017
Year ending March 31, 2018Year ending March 31, 2018
(Forecast)First quarter

Second quarter

Third quarter

Year-end

Annual

Yen

Yen
30.00

Yen
−

Yen
30.00

Yen
60.00

30.00

−

30.00

60.00

−
−

(Note) Revisions in dividend forecast in the current quarter: No

3. Forecast (From April 1, 2017 to March 31, 2018)

OperatingincomeRevenue
Millions of yen

1st half
Year ending March 31, 2018

58,000120,000(Percentage: Changes relative to corresponding previous period)

%

12.2
12.3

%

Millions of yen

6,000
11,500

Profit before
tax

5.3
464.2

Millions of yen

5,900
11,300%

Profit attributable
Basic earnings
toper shareowners of parent
Millions of yen
%
Yen

7.3
545.2

3,900
7,600

(2.0)
−

119.63233.13(Note) Revisions in forecast in the current quarter: Yes
For details, please refer to “Notice of Revision of Financial Forecast” made public on July 28, 2017.
* Notes(1) Changes in significant subsidiaries during the current quarter: No(2) Changes in accounting policies and accounting estimates(i) Changes in accounting policies required by IFRS: No(ii) Changes other than (i) above: No(iii) Changes in accounting estimates: No(3) Number of issued shares (common stock)(i) Number of issued shares at the quarter end (including treasury shares)
As of June 30, 201736,254,344 shares

As of March 31, 201736,254,344 shares(ii) Number of treasury shares at the quarter end
As of June 30, 2017

3,655,087 shares

As of March 31, 2017

3,654,987 shares(iii) Averaged number of shares during the period (quarterly cumulative period)
Three months ended June 30, 201732,599,307 shares

Three months ended June 30, 2016

32,599,647 shares*The quarterly financial statements are not subject to quarterly reviews.
(Notes on forward looking statements, etc.)
These forecast performance figures are based on the information currently available to the company’s
management and certain assumptions judged rational. Accordingly, these might be cases in which actual resultsmaterially differ from forecasts of this report. Please refer to page 3 “1. Qualitative Information (3) Consolidated
Performance Forecasts” for the assumptions used and other notes.

【Appendix】

Table of contents of the appendix
1. Qualitative Information ................................................................................................................................

2(1) Consolidated Business Performance ........................................................................................................ 2(2) Consolidated Financial Position and Cash Flows for the three months ended June 30, 2017 ............. 2(3) Consolidated Performance Forecasts ....................................................................................................... 3
2. Condensed Consolidated Financial Statements...........................................................................................

4(1) Condensed Consolidated Statements of Financial Position ................................................................... 4(2) Condensed Consolidated Statements of Income for the three months ended June 30, 2017 ............... 6(3) Condensed Consolidated Statements of Comprehensive Income for the three months ended June30, 2017...................................................................................................................................................... 7(4) Condensed Consolidated Statements of Changes in Equity ................................................................... 8(5) Condensed Consolidated Statements of Cash Flows .............................................................................. 10(6) Notes on Assumptions for Going Concern ............................................................................................... 11(7) Notes on Condensed Consolidated Financial Statements ...................................................................... 11
1. Reporting entity ................................................................................................................................... 11
2. Basis of preparation ............................................................................................................................ 11
3. Significant accounting policies............................................................................................................ 11
4. Significant accounting estimates and associated judgments ............................................................ 11
5. Segment information ........................................................................................................................... 12
6. Subsequent events ............................................................................................................................... 13−

1 −1. Qualitative Information(1) Consolidated Business Performance
In the Japanese economy during the first quarter of the current fiscal year (April 1, 2017 to June 30, 2017),
corporate earnings registered moderate growth on the back of the government’s economic policies and the
Bank of Japan’s monetary easing policies, while personal consumption continued to lack vigor. The outlook,however, remains opaque due to mounting issues of concern on the global political and economic scene andgrowing geopolitical risks.
Under these economic conditions, the group’s results in each business segment were as follows.
Precious metal business
Volume of collection in the precious metals recycling business was as follows. In the electronics sector, thevolume of collection of gold was larger than the same period a year earlier, thanks to the notable developmentof new customers in the precision cleaning and plating treatment businesses. In the dental sector, the volume
of collection of gold and palladium increased from the same period in the previous year. In the jewelry sector,
the volume of collection of gold and platinum expanded from the same period a year before. In the automotive
catalyst sector, the volume of collection of palladium and platinum increased from the same period in theprevious year. Regarding the average price of precious metals, the average prices for gold, silver andpalladium were higher than in the same period a year before, while the average price of platinum was lower
than in the same period in the previous year.
As for gold and silver refining business in North America, earnings from commissioned refining businessincreased from the same period a year earlier, while selling, general and administrative expenses decreased
from the same period in the previous year.
Environmental preservation businessAlthough the volume of industrial waste discharged in Japan is on a downward trend in general, the overall
volume handled by the group remained almost equal with that in the same period in the previous year, asgroup companies focused on developing new customers and obtaining contracts by capitalizing on theircharacteristics and inter-company collaboration.
Life & health businessIn the health care equipment sectors, overall sales increased from the same period in the previous year,
thanks to efforts to expand the sales of large-size massage chairs as the core item and other products
including low-style massage chairs and electrolytic hydrogen water generators. As for fire-fighting equipment,
business remained equal with the same period a year earlier, thanks in part to strong demand in building
construction projects in the metropolitan area.
As a result of the above, revenue during the first quarter of the current fiscal year was 32,476 million yen, a
year-on-year increase of 4,675 million yen (+16.8 percent). Operating income was 3,491 million yen, an
increase of 845 million yen (+32.0 percent) year-on-year. Profit before tax was 3,402 million yen, a year-onyear increase of 885 million yen (+35.2 percent). Profit was 2,381 million yen, a year-on-year increase of 488
million yen (+25.8 percent). Profit attributable to owners of parent for the period was therefore 2,343 million
yen, an increase of 464 million yen (+24.7 percent) year-on-year. By segment, revenue in the precious metalbusiness was 21,884 million yen, a year-on-year increase of 3,514 million yen (+19.1 percent). In theenvironmental preservation business, revenue was 3,979 million yen, and increase of 110 million yen (+2.8
percent) year-on-year. Revenue in the life & health business was 6,636 million yen, up 1,056 million yen(+18.9 percent) year-on-year.

(2) Consolidated Financial Position and Cash Flows for the three months ended June 30, 2017
As of June 30, 2017, total assets amounted to 88,760 million yen, down 216 million yen from the previous
fiscal year end. This was due mainly to the decrease of 1,371 million yen in trade and other receivables.
Total liabilities amounted to 43,290 million yen, down 858 million yen from the previous fiscal year end.
This was due mainly to the decrease of 551 million yen in loans payable.
Total equity amounted to 45,469 million yen, up 642 million yen from the previous fiscal year end. This wasdue mainly to comprehensive income of 1,610 million yen.
−

2 −

As a result, the equity attributable to owners of parent ratio changed to 50.6%, from 49.8% at the end of theprevious fiscal year.
Net cash provided by operating activities amounted to 3,106 million yen due mainly to 3,402 million yen of
profit before tax , 583 million yen of depreciation and amortization, 198 million yen of increase in inventories,
1,307 million yen of decrease in trade and other receivables, and 1,919 million yen of income taxes paid .
Net cash used in investing activities amounted to 1,229 million yen due mainly to 1,283 million yen ofpurchase of property, plant and equipment.
Net cash used in financial activities amounted to 1,499 million yen due mainly to 972 million yen of cash
dividends paid.
As a result, cash and cash equivalents as of June 30, 2017 increased 432 million yen from March 31, 2017,
to 11,230 million yen.

(3) Consolidated Performance Forecasts
The company revised the first half period consolidated financial forecast, owing to precious metal prices
exceeding our initial estimates, and collection volume of precious metals is expected to exceed the initial plan.

Revision of the First Half Period Consolidated Financial Forecast(April 1, 2017 to September 30, 2017）
OperatingincomeRevenue

Profit before
tax（Millions of yen, ％）Profitattributable to Basic earnings
owners ofper share
parentPrevious Forecast (A)(Announced on May 10, 2017)

58,000

5,500

5,400

3,600

110.43

Revised Forecast (B)58,000

6,000

5,900

3,900

119.63

Change (B－A)

−

500

500

300

−

Change (%)

−

9.1

9.3

8.3

−

51,691

5,696

5,499

3,981

122.13(Ref.) Previous Fiscal YearFirst Half Results(Six Months Ended
September 30, 2016)−3 −2. Condensed Consolidated Financial Statements(1) Condensed Consolidated Statements of Financial Position
As ofMarch 31,
2017

As of
June 30,
2017

Millions ofyenMillions ofyen

ASSETS
Current assets
Cash and cash equivalents

10,798

11,230Trade and other receivables
Inventories

15,557
17,35614,186
17,558

Income tax receivables
Other financial assets

1,574
103

1,647
12

Other current assets

664

570

Total current assets

46,05645,20531,987

32,840Goodwill
Intangible assets

8,238
918

8,238
861

Deferred tax assets
Net defined benefit asset

1,167
64

997
28

Financial assets
Other non-current assets

528
15

572
15

Total non-current assets

42,92043,55588,976

88,760Non-current assets
Property, plant and equipment

Total assets−

4 −As ofMarch 31,
2017

As of
June 30,
2017

Millions ofyenMillions ofyen

LIABILITIES and EQUITY
Liabilities
Current liabilities
Trade and other payables

12,71011,897Loans payable
Income tax payable

2,720
1,061

2,320
1,008

Other financial liabilities
Provisions

191
1,490

1,043
1,240

Other current liabilities

2,613

2,535

Total current liabilities
Non-current liabilities

20,78720,045Loans payable
Deferred tax liabilities

20,195
1,790

20,043
1,822

Net defined benefit liability
Other financial liabilities

143
1,221

145
1,216

Other non-current liabilities

10

17

Total non-current liabilities

23,361

23,24544,14843,290Total liabilities
EquityCapital stock

4,480

4,480

Capital surplus
Treasury stock

6,126(5,371)

6,136(5,371)Retained earnings
Other components of equity

42,783(3,716)

44,117(4,459)Total equity attributable to owners of parent
Non-controlling interests

44,303524

44,904565

Total equity

44,82745,46988,976

88,760Total liabilities and equity−

5 −(2) Condensed Consolidated Statements of Income for the three months ended June 30, 2017

Revenue
Cost of sales

The three months
ended June 30, 2016

The three months
ended June 30, 2017

Millions of yen

Millions of yen

27,800(22,008)

32,476(25,324)

Gross profit

5,792

7,151

Selling, general and administrative expenses
Other operating income(3,786)650(3,684)40

Other operating expenses

(10)

(15)

Operating income

2,645

3,491

Finance income
Finance cost

5
(134)

36
(125)

Profit before tax

2,517

3,402

Income tax expenses(623)(1,020)

Profit

1,893

2,381

Owners of parent
Non-controlling interests

1,879
14

2,343
38

Profit

1,893

2,381

57.64

71.89

57.64

71.89

Profit attributable to:Earnings per share
Basic earnings per share (Yen)
Diluted earnings per share (Yen)−6 −(3) Condensed Consolidated Statements of Comprehensive Income for the three months ended
June 30, 2017

Profit

The three months
ended June 30, 2016

The three months
ended June 30, 2017

Millions of yen

Millions of yen

1,893

2,381

(20)

10

22

(31)

2

(20)

194

(934)

Other comprehensive income
Items that will not be reclassified to profit or loss
Financial assets measured at fair value through othercomprehensive income
Remeasurements of defined benefit plans
Total items that will not be reclassified to profit or loss
Items that will be reclassified to profit or loss
Cash flow hedges
Translation adjustments of foreign operations(1,962)

183

Total items that will be reclassified to profit or loss

(1,767)(750)

Other comprehensive income, net of tax
Comprehensive income(1,765)

(771)

127

1,610

114
13

1,569
40

127

1,610

Comprehensive income attributable to:
Owners of parent
Non-controlling interests
Comprehensive income−

7 −(4) Condensed Consolidated Statements of Changes in Equity(Millions of yen)
Equity attributable to owners of parent

Capitalstock

Balance at April 1, 2016
ProfitOther comprehensive
incomeTotal comprehensive
incomePurchase of treasury stock
Dividends
Reclassified from othercomponents of equity toretained earnings
Share-based paymenttransactions
Total transactions withownersBalance at June 30, 2016

CapitalsurplusTreasurystock

Retainedearnings

Other components ofequityTranslation
adjustments Cash flowof foreign
hedgesoperations

4,480
−

6,112
−

(5,371)−45,845
1,879(2,125)
−

(380)
−

−

−

−

−

(1,961)

194

−

−

−

1,879

(1,961)

194

−
−

−
−

(0)
−

−
(984)

−
−

−
−

−

−

−

19

−

−

−

3

−

−

−

−

−

3

(0)

(965)

−

−

4,480

6,116

(5,371)46,759(4,087)(185)(Millions of yen)
Equity attributable to owners of parent
Other components of equity
FinancialassetsRemeasuremeasured atments offair value
definedthrough
benefitotherplanscomprehensive income
Balance at April 1, 2016
ProfitOther comprehensive
incomeTotal comprehensive
incomePurchase of treasury stock
Dividends
Reclassified from othercomponents of equity toretained earnings
Share-based paymenttransactions
Total transactions withownersBalance at June 30, 2016

Total

Total

Noncontrollinginterests

Total

29
−

−
−

(2,476)−

48,591
1,879

396
14

48,988
1,893

(20)

22

(1,764)(1,764)(1)(1,765)(20)

22(1,764)

114

13

127

−
−

−
−

−
−

(0)
(984)

−
−

(0)
(984)

3

(22)

(19)

−

−

−

−

−

−

3

−

3

3

(22)

(19)

(981)

−

(981)

11

−

(4,260)47,724409

48,134−8 −(Millions of yen)
Equity attributable to owners of parent

Capitalstock

Balance at April 1, 2017
ProfitOther comprehensive
incomeTotal comprehensive
incomePurchase of treasury stock
Dividends
Reclassified from othercomponents of equity toretained earnings
Share-based paymenttransactions
Total transactions withownersBalance at June 30, 2017

CapitalsurplusTreasurystock

Retainedearnings

Other components ofequityTranslation
adjustments Cash flowof foreign
hedgesoperations

4,480
−

6,126
−

(5,371)−42,783
2,343(3,618)
−

(104)
−

−

−

−

−

183

(934)

−

−

−

2,343

183

(934)

−
−

−
−

(0)
−

−
(977)

−
−

−
−

−

−

−

(31)

−

−

−

10

−

−

−

−

−

10

(0)

(1,009)

−

−

4,480

6,136

(5,371)

44,117(3,435)(1,039)(Millions of yen)
Equity attributable to owners of parent
Other components of equity
FinancialassetsRemeasuremeasured atments offair value
definedthrough
benefitotherplanscomprehensive income
Balance at April 1, 2017
ProfitOther comprehensive
incomeTotal comprehensive
incomePurchase of treasury stock
Dividends
Reclassified from othercomponents of equity toretained earnings
Share-based paymenttransactions
Total transactions withownersBalance at June 30, 2017

Total

Total

Noncontrollinginterests

Total

7
−

−
−

(3,716)−44,303
2,343

524
38

44,827
2,381

8

(31)

(774)

(774)

2

(771)

8

(31)

(774)

1,569

40

1,610

−
−

−
−

−
−

(0)
(977)

−
−

(0)
(977)

−

31

31

−

−

−

−

−

−

10

−

10

−

31

31

(968)

−

(968)

15

−

(4,459)44,904565

45,469−9 −(5) Condensed Consolidated Statements of Cash FlowsThe threemonths ended
June 30,
2016

The threemonths ended
June 30,
2017

Millions of yen

Millions of yen

Net cash provided by (used in) operating activities
Profit before tax
Depreciation and amortization

2,517
575

Impairment loss
Finance income and finance cost

1
96

3,402
583
−
119

Decrease (increase) in inventories
Decrease (increase) in trade and other receivables

878(1,448)

(198)
1,307

Increase (decrease) in trade and other payables
Other, net

482
(294)

(682)
607

Subtotal

2,808

5,139

4
(27)

4
(137)

(3,089)913(1,919)
20

608

3,106

Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment

(265)
169

(1,283)98

Purchase of intangible assets
Other, net

(51)
(12)

(62)
18

Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities(160)(1,229)Net increase (decrease) in short-term loans payable
Repayment of long-term loans payable

1,627(5,135)

(400)
(125)

Purchase of treasury stock
Cash dividends paid

(0)
(976)

(0)
(972)

Other, net

(11)

(1)

Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents(4,496)(230)(1,499)55

Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period(4,277)
16,564432
10,798Cash and cash equivalents at end of period

12,287

11,230Interest and dividends income received
Interest expenses paid
Income taxes paid
Income taxes refund
Net cash provided by (used in) operating activities
Net cash provided by (used in) investing activities

−

10 −

(6) Notes on Assumptions for Going Concern
Not applicable(7) Notes on Condensed Consolidated Financial Statements
1. Reporting entity
Asahi Holdings, Inc. (hereinafter the “Company”) is a company located in Japan. The Company’s
condensed consolidated financial statements for the three months ended June 30, 2017 comprise thefinancial statements of the Company as well as its subsidiaries (the “Group”).
For the main activities of the Group, please refer to Note 5. “Segment information.”

2. Basis of preparation(1) Statement of compliance with IFRSThe condensed consolidated financial statements of the Group have been prepared based on IAS 34“Interim Financial Reporting.”
Having met the requirements for a Specified Company under the Designated International AccountingStandards, as prescribed in Article 1-2 of the Ordinance on the Terminology, Forms, and Preparation
Methods of Quarterly Consolidated Financial Statements (Cabinet Office Ordinance No. 64 of 2007), theGroup adopts the provisions of Article 93 of the aforementioned rules.
(2) Basis of measurement
The condensed consolidated financial statements of the Group have been prepared based on costs ofacquisition, except for the specified financial instruments that have been measured at fair value.
(3) Functional currency and presentation currency
The condensed consolidated financial statements of the Group are presented in Japanese yen, which isthe functional currency of the Company, and figures less than one million yen are rounded down to thenearest million yen.
(4) Early adoption of new standards
The Group has implemented an early adoption of IFRS 9 “Financial Instruments” (published in
November 2009, and revised in July 2014), as from the date of transition to IFRS

3. Significant accounting policies
The significant accounting policies adopted for the condensed consolidated financial statements are thesame as those for the consolidated financial statements for the fiscal year ended March 31, 2017.

4. Significant accounting estimates and associated judgments
In preparing condensed consolidated financial statements, the management is required to make judgment,
estimates and assumptions that affect the adoption of accounting policies and the amounts of assets,
liabilities, revenues and expenses. Actual results may differ from such estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. The effect of a change inaccounting estimates is recognized as the accounting period in which such change occurs as well as theaccounting periods to be affected in the future.
The estimates and judgments made by the management that may have material impacts on the figures in
the condensed consolidated financial statements are the same as those for the consolidated financial
statements for the fiscal year ended March 31, 2017.

−

11 −

5. Segment information(1) Overview of reporting segments
The Group’s reporting segments are those Group constituent units for which separate financial
information is obtainable, and which the Board of Directors subjects to regular examination in order todecide the allocation of management resources and evaluate business results.
As a pure holding company, the Company is in charge of overall strategic function for the Group,
whereas operating companies of the Group engage in the precious and rare metals recycling business andthe refining and processing business, industrial waste management and other environmental
preservation business, and life & health business including manufacturing and selling of healthequipment.
Therefore, the Group is composed of product and service segments based on business sectors. The threereporting segments are the precious metal business, the environmental preservation business, and thelife & health business. Meanwhile, these reporting segments are not be aggregated.
The precious metals business engages mainly in recycling and selling of precious and rare metals suchas gold, silver, palladium, platinum, and indium, as well as refining and processing of precious metals
such as gold and silver. The main work of environmental preservation business is the collection, transport
and intermediate processing of industrial waste. In the life & health business, the main work is the
manufacture and sales of massagers, hearing aids, and other health equipment, the manufacture andsales of electric heaters, the design and installation of radiant heating and air conditioning systems, andthe design and installation of disaster prevention equipment.
(2) Segment revenue and performance
Accounting policies of the reporting segments are the same as those for the consolidated financial
statements for the fiscal year ended March 31, 2017.
Revenue and other performance of each reportable segment of the Group are as follows.
For the three months ended June 30, 2016 (from April 1, 2016 to June 30, 2016)(Millions of yen)
Reporting segment
Precious metalbusiness

Environmental
preservation
business

Life & healthbusiness

18,369
−

3,851
17

5,580
−

27,8001718,369

3,868

5,580

27,818

2,388

706

160

3,255

Total

Adjustment

Consolidated−(17)

27,800−(17)27,800

(609)

2,645

Revenue
External revenue
Intersegment revenue
Total
Operating income by businesssegment
Finance income
Finance costs

5
(134)

Profit before tax

2,517(Note) 1. Intersegment transactions are based on prevailing market prices.
2. Adjustments of operating income by business segment are mainly corporate expenses that are notallocated to each reporting segment.

−

12 −

For the three months ended June 30, 2017 (from April 1, 2017 to June 30, 2017)(Millions of yen)
Reporting segment
Precious metalbusiness

Environmental
preservation
business

Life & healthbusiness

21,884
−

3,955
23

6,636
−

32,47623

21,884

3,979

6,636

2,912

764

394

Total

Adjustment

Consolidated−(23)

32,476−32,499(23)

32,476

4,071

(580)

3,491

Revenue
External revenue
Intersegment revenue
Total
Operating income by businesssegment
Finance income
Finance costs

36
(125)

Profit before tax

3,402(Note) 1. Intersegment transactions are based on prevailing market prices.
2. Adjustments of operating income by business segment are mainly corporate expenses that are notallocated to each reporting segment.

6. Subsequent events
Not applicable−13 −