Summary of Financial Statements for the First Quarter of Fiscal Year Ending April 2017
[Japan GAAP] (Consolidated)
August 25, 2016
Name of listed company:

AIN HOLDINGS INC.

Exchange listed on:First Section of Tokyo Stock Exchange and Sapporo Securities Exchange

Code number:

9627

URL:

http://www.ainj.co.jp/

Representative:
Inquiries:

Kiichi Otani, President and Representative Director
Toshihide Mizushima, Representative Senior Managing Director
TEL: +81-11-814-1000
Date of filing quarterly securities report:
September 14, 2016
Start of dividend payment:–

Supplementary documents for quarterly results:

Yes

Quarterly results briefing:No(Amounts are rounded down to the nearest million yen.)
1. Consolidated results for the first quarter of fiscal year ending April 30, 2017 (May 1, 2016 to July 31, 2016)(1) Consolidated operating results(Percentage figures show year-on-year changes.)
Profit attributable to
Net sales
Operating income
Ordinary income
owners of parent
Million yen% Million yen%
Million yen% Million yen%
Three months ended July 31, 2016
Three months ended July 31, 2015
(Note) Comprehensive income:

57,819(17.7)

1,371(10.5)

52,146
20.3
2,710
58.7
2,886
58.1
Three months ended July 31, 2016:¥1,384 million (-14.3%)
Three months ended July 31, 2015:¥1,615 million (+52.3%)

10.9

1,533

52.7

Earnings
per share

2,281(15.8)

2,376

Diluted earnings
per share
Yen

Yen

Three months ended July 31, 2016

43.25

–

Three months ended July 31, 2015

48.35

–

(2) Consolidated financial position
Shareholders’equity ratio

Net assets

Total assets

Net assets per
share

Million yen

Million yen%

Yen

As of July 31, 2016

139,149

53,44038.4

1,683.53

As of April 30, 2016

139,888

53,32438.1

1,679.69(Reference) Shareholders’ equity:

As of July 31, 2016: ¥53,380 million

As of April 30, 2016: ¥53,258 million

2. Dividends

Year ended April 30, 2016

End of firstquarterYen–

End of second
quarter
Yen
0.00

Dividend per share
End of third
quarter
Yen––
Year ending April 30, 2017
Year ending April 30, 2017
0.00
(forecast)(Note) Revision to the most recently announced dividend forecasts: No–

End of year

Full year

Yen

Yen

40.00

40.00

50.00

50.00

3. Consolidated financial forecasts for the fiscal year ending April 30, 2017 (May 1, 2016 to April 30, 2017)(Percentage figures show year-on-year changes.)
Profit attributable toEarnings
Net sales
Operating income
Ordinary income
owners of parent
per share
Million yen%
Million yen%
Million yen%
Million yen%
Yen
First six
126,000
17.8
6,150
4.2
6,350
4.4
3,470
5.3
109.44monthsFull year
265,000
12.8
16,30011.5
16,700
10.2
9,000
13.7
283.84(Note) Revision to the most recently announced consolidated financial forecasts: No*Notes(1) Major changes in subsidiaries during the period (changes in specified subsidiaries resulting from changes in scope of
consolidation): No
Newly consolidated: –Excluded: –(2) Application of specified accounting methods for the preparation of quarterly consolidated financial statements: Yes(Note) For detail, please refer to “2. Matters concerning summary information (notes) (2) Application of specified
accounting methods for the preparation of quarterly consolidated financial statements” on page 3 of the
Attachment.
(3) Changes in accounting principles, changes in accounting estimates, and restatement of revisions
1) Changes in accounting principles as a result of revisions to accounting standards, etc.:
No2) Changes in accounting principles other than 1):
No3) Changes in accounting estimates:
No4) Restatement of revisions:No(4) Number of outstanding shares (common stock)1) Number of outstanding
shares (including treasury
As of July 31, 2016
stock):
2) Number of shares held in
As of July 31, 2016
treasury:
3) Average number ofThree months ended
shares outstanding:July 31, 2016

31,888,212 shares As of April 30, 2016

31,888,212 shares

180,644 shares As of April 30, 2016

180,595 shares

Three months ended
July 31, 2015

31,707,617 shares

31,707,568 shares*Status of execution of the quarterly review of financial statements
This quarterly financial summary is not subject to the quarterly review procedure based on the Financial Instruments andExchange Act. As of the time of disclosure, this review procedure for quarterly financial statements had not been
completed.
*Statement regarding the proper use of financial forecasts and other special remarks
The above forecasts are calculated based on the information available as of the publication date of this material, and actual
financial results may vary due to change in future economic conditions and others.

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2017

Contents of the Attachment
1. Qualitative information on consolidated results for the period under review ........................................................................ 2(1) Consolidated operating results .................................................................................................................................... 2(2) Consolidated financial position .................................................................................................................................... 2(3) Forecast of consolidated financial results and other forward-looking information............................................................ 3
2. Matters concerning summary information (notes) .............................................................................................................. 3(1) Major changes in subsidiaries during the period ........................................................................................................... 3(2) Application of specified accounting methods for the preparation of quarterly consolidated financial statements .............. 3(3) Changes in accounting principles, changes in accounting estimates, and restatement of revisions ................................ 3(4) Additional information .................................................................................................................................................. 3
3. Quarterly consolidated financial statements ...................................................................................................................... 4(1) Quarterly consolidated balance sheet .......................................................................................................................... 4(2) Quarterly consolidated statements of income and comprehensive income .................................................................... 6
Quarterly consolidated statement of income ................................................................................................................. 6
Quarterly consolidated statement of comprehensive income ......................................................................................... 7(3) Notes on quarterly consolidated financial statements.................................................................................................... 8(Notes on the premise of a going concern) ................................................................................................................... 8(Notes on significant changes in the amount of shareholders’ equity) .......................................................................... 8(Segment Information, etc.) ........................................................................................................................................ 8

1

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2017

1. Qualitative information on consolidated results for the period under review(1) Consolidated operating results
During the first three months of the current fiscal year (May 1, 2016 to July 31, 2016), the Japanese economy recoveredat a moderate pace, supported by an improvement in the employment market, despite slowing momentum in corporate
earnings and consumer spending.
In this economic environment, the AIN HOLDINGS Group (the Group) worked to expand its business and increase
earnings. Specifically, the Group opened new dispensing pharmacies and used M&A to expand the business. It also
developed its urban drug and cosmetic store business.
In the first three months of the fiscal year, net sales increased 10.9% year on year to ¥57,819 million, operating income
decreased 15.8% to ¥2,281 million, ordinary income decreased 17.7% to ¥2,376 million, and profit attributable to ownersof parent decreased 10.5% to ¥1,371 million.
Financial results by business segment are as follows.
(Dispensing pharmacy business)
In drug price and dispensing fee revisions in April 2016, the role of pharmacies located near hospitals was reevaluated,
but in order to realize patient-focused non-hospital dispensing services, pharmacists and dispensing pharmacies are now
being required to play a key role at the heart of local communities.
To ensure our pharmacists and dispensing pharmacies fulfill their role at the heart of local communities, the Group
continues to build links with local healthcare service providers, mainly in the area of home-based dispensing, step up theintegration and continuous management of drug information using patient medication notebooks and other means, andpromote wider use of generic drugs. In addition, we stepped up training for the 375 newly graduated pharmacists thatjoined the Group in April 2016 in order to enhance their skills as primary care pharmacists.
In business development, the Group continued to push ahead with business expansion by opening new dispensing
pharmacies and through M&A deals.
As a result, for the first three months of the fiscal year, the dispensing pharmacy business reported higher sales but
lower profit with sales rising 10.0% year on year to ¥51,438 million and segment income decreasing 8.2% to ¥3,437
million.
During the period under review, the Group opened 14 new dispensing pharmacies, including those acquired throughM&A deals, and closed one pharmacy, resulting in a total of 894.
(Drug and cosmetic store business)
In the drug and cosmetic store business, the market environment remained challenging due to a narrowing competitive
gap between companies in the sector and the emergence of new competitors from sector consolidation and realignmentthat also extends to other business sectors.
Against this backdrop, the Group continued to open ainz & tulpe urban drug and cosmetic stores, strengthened
merchandise lineups, particularly drug and cosmetics products, and worked to capture inbound demand. We also actively
developed proprietary merchandise brands such as LIPS and HIPS and cocodecica, leading to an increase in profit
margins.
As a result, for the first three months of the fiscal year, the drug and cosmetic store business reported an increase insales of 5.2% year on year to ¥5,246 million. However, segment loss was ¥194 million, compared with segment loss of¥124 million in the same period a year earlier.
In the first quarter of the fiscal year, the Group opened ainz & tulpe Colette Mare SAKURAGICHO-B1 (Naka Ward,
Yokohama) and closed one store, resulting in a total of 52 cosmetic and drug stores at the end of the first quarter.
(Other businesses)
Net sales from other businesses rose 200.2% year on year to ¥1,134 million and segment loss was ¥419 million
compared with the loss of ¥127 million a year earlier.
(2) Consolidated financial position
The balance of total assets at the end of the first quarter decreased by ¥738 million from the end of the previous fiscal
year to ¥139,149 million.
This mainly reflected cash on hand and in banks, an increase in inventories due to business expansion through newstore openings and M&A, as well as a decline in the balance of accounts receivable.
The balance of liabilities decreased by ¥854 million to ¥85,709 million, mainly reflecting a decrease in accounts payable
and a decrease in accrued income taxes.
The balance of short- and long-term debts increased by ¥1,380 million to ¥21,925 million.
2

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2017

Total net assets increased by ¥115 million to ¥53,440 million and the shareholders’ equity ratio improved 0.3
percentage points to 38.4%.
(3) Forecast of consolidated financial results and other forward-looking information
The Group has made no change to its earnings forecasts for the first six months of the fiscal year and for the full fiscal
year, announced on May 27, 2016.

2. Matters concerning summary information (notes)(1) Major changes in subsidiaries during the period
There are no applicable matters to be reported.
(2) Application of specified accounting methods for the preparation of quarterly consolidated financial statements
Tax expenses were calculated by reasonably estimating the effective tax rate after the application of tax effectaccounting to net income before taxes for the consolidated fiscal year including the first quarter, and multiplying theestimated effective tax rate by income before income taxes for the quarter.
(3) Changes in accounting principles, changes in accounting estimates, and restatement of revisions
There are no applicable matters to be reported.
(4) Additional information(Adoption of the Implementation Guidance on Recoverability of Deferred Tax Assets)
Effective from the first quarter of the current fiscal year, the Company has applied the Implementation Guidance on
Recoverability of Deferred Tax Assets (ASBJ Guidance No. 26, March 28, 2016).

3

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2017

3. Quarterly consolidated financial statements(1) Quarterly consolidated balance sheet(Thousand yen)

AssetsCurrent assets
Cash on hand and in banks
Notes and accounts receivable
Merchandise
Supplies
Deferred tax assets
Short-term loans
Other accounts receivable
Other current assets
Allowance for doubtful accounts
Total current assets
Fixed assets
Property, plant and equipment
Buildings and structures, net
Land
Other property, plant and equipment, net
Total property, plant and equipment
Intangible fixed assets
Goodwill
Other intangible fixed assets
Total intangible fixed assets
Investments and other assets
Investments in securities
Deferred tax assets
Deposits and guarantees
Other investments and other assets
Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
Total assets

4

Fiscal year endedApril 30, 2016
(As of April 30, 2016)

Three months ended
July 31, 2016
(As of July 31, 2016)

22,647,300
12,385,821
10,661,177
323,473
1,149,432
639,457
5,983,629
2,806,438(3,337)56,593,392

26,822,431
7,621,773
11,424,912
312,506
1,156,197
630,997
6,087,113
2,270,754－
56,326,685

14,694,738
9,537,493
3,921,089
28,153,320

14,570,812
9,517,808
3,677,432
27,766,053

33,337,372
2,248,861
35,586,233

33,308,599
2,250,095
35,558,695

2,677,643
2,038,851
10,013,440
6,062,530(1,237,174)
19,555,292
83,294,846
139,888,239

2,582,301
2,084,421
10,037,413
6,031,400(1,237,174)
19,498,362
82,823,110
139,149,796

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2017

(Thousand yen)

Liabilities
Current liabilities
Accounts payable
Short-term debt
Accrued income taxes
Deposits received
Allowance for bonuses to employees
Allowance for bonuses to directors
Reserve for reward obligations
Provision for sales returns
Other current liabilities
Total current liabilities
Long-term liabilities
Long-term debt
Net defined benefit liability
Other long-term liabilities
Total long-term liabilities
Total liabilities
Net assets
Shareholders’ equity
Common stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Unrealized holding losses on securities
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

5

Fiscal year endedApril 30, 2016
(As of April 30, 2016)

Three months ended
July 31, 2016
(As of July 31, 2016)

39,987,595
5,690,001
4,448,862
10,112,896
1,633,520
13,590390,200
15,815
4,452,428
66,744,908

38,320,139
8,477,116
909,90312,480,041
1,429,275
6,378
400,408
12,8395,264,204
67,300,305

14,854,307
2,228,446
2,735,964
19,818,717
86,563,626

13,448,146
2,256,956
2,703,875
18,408,97885,709,284

8,682,976
6,367,844
38,605,783(419,311)
53,237,293

8,682,976
6,367,844
38,708,884(419,598)
53,340,108(63,296)
84,867
21,57065,74853,324,613
139,888,239(36,042)
76,69640,65359,75053,440,512
139,149,796

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2017(2) Quarterly consolidated statements of income and comprehensive income
Quarterly consolidated statement of income(Thousand yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Commissions received
Real estate rental revenue
Consignment income
Other non-operating income
Total non-operating income
Non-operating expenses
Interest expenses
Losses on sales of accounts receivables
Real estate rental expenses
Other non-operating expenses
Total non-operating expenses
Ordinary income
Extraordinary income
Gains on sales of fixed assets
Insurance income
Gain on sales of investment securities
Total extraordinary income
Extraordinary losses
Losses on disposal and sales of fixed assets
Impairment losses on investments in securities
Other extraordinary losses
Total extraordinary losses
Profit before income taxes
Income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

6

Three months ended
July 31, 2015
(May 1, 2015 toJuly 31, 2015)
52,146,536
44,330,521
7,816,015
5,105,544
2,710,470

Three months ended
July 31, 2016
(May 1, 2016 toJuly 31, 2016)
57,819,476
48,865,278
8,954,198
6,672,530
2,281,667

6,737
21,361
17,60543,36045,255
112,670
246,992

16,586
20,848
8,628
57,20334,87747,662
185,805

20,105
19,59521,8989,500
71,1002,886,361

32,772
15,862
22,242
20,251
91,1282,376,345

762
4,391
－
5,153

3,513
36,908150,400
190,82171,47679,0092,719
153,204
2,738,311
1,194,484
1,543,826
10,706
1,533,119

58,411－
26,65785,0682,482,098
1,116,690
1,365,407(5,998)
1,371,406

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2017

Quarterly consolidated statement of comprehensive income(Thousand yen)

ProfitOther comprehensive income:Unrealized holding gains on securities
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to owners ofparentComprehensive income attributable to non-controllinginterests

7

Three months ended
July 31, 2015
(May 1, 2015 toJuly 31, 2015)
1,543,826

Three months ended
July 31, 2016
(May 1, 2016 toJuly 31, 2016)
1,365,407

64,7896,479
71,2691,615,095

27,253(8,171)
19,082
1,384,490

1,604,389

1,390,488

10,706(5,998)AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2017(3) Notes on quarterly consolidated financial statements(Notes on the premise of a going concern)
There are no applicable matters to be reported.
(Notes on significant changes in the amount of shareholders’ equity)
There are no applicable matters to be reported.
(Segment Information, etc.)
I Three months ended July 31, 2015 (May 1, 2015 to July 31, 2015)
1. Net sales and income (loss) by reportable segment
Reportable segments(Thousand yen)
Carried onquarterly
Adjustments
consolidated(Note) 1
statements ofincome(Note) 2

Dispensing
pharmacy

Drug andcosmetic store(1) Sales to third parties

46,783,003

4,985,685

377,847

52,146,536－

52,146,536(2) Intersegment sales－－

78,042

78,042(78,042)－

Total sales

46,783,003

4,985,685

455,890

52,224,579(78,042)

52,146,536

Segment income (loss)

3,745,637(124,978)(127,526)

3,493,132(606,770)

2,886,361

Other

Total

Sales

Notes:

1. The adjustment of ¥(606,770) thousand to segment income (loss) includes ¥626,622 thousand in corporate
expenses, ¥11,248 thousand in (income) loss that is not allocated to reportable segments, and ¥(31,099)
thousand in eliminations due to intersegment transactions.
Overall group expenses consist mainly of expenses associated with the administrative divisions of the parent
company, such as general affairs and accounting divisions.
2. Segment income (loss) is adjusted with the ordinary income of quarterly consolidated statements of income.

2. Impairment losses on fixed assets and goodwill by reportable segment[Significant impairment losses on fixed assets]:
There are no applicable matters to be reported.
[Significant changes in the amount of goodwill]:
There are no applicable matters to be reported.

II Three months ended July 31, 2016 (May 1, 2016 to July 31, 2016)
1. Net sales and income (loss) by reportable segment
Reportable segments(Thousand yen)
Carried onquarterly
Adjustments
consolidated(Note) 1
statements ofincome(Note) 2

Dispensing
pharmacy

Drug andcosmetic store(1) Sales to third parties

51,438,259

5,246,834

1,134,382

57,819,476－

57,819,476(2) Intersegment sales－－

94,232

94,232(94,232)－

Total sales

51,438,259

5,246,834

1,228,614

57,913,708(94,232)

57,819,476

Segment income (loss)

3,437,257(194,511)(419,624)

2,823,121(446,775)

2,376,345

Other

Total

Sales

Notes:

1. The adjustment of ¥(446,775) thousand to segment income (loss) includes ¥822,252 thousand in corporate
expenses, ¥(359,661) thousand in (income) loss that is not allocated to reportable segments, and ¥(15,816)
thousand in eliminations due to intersegment transactions.
Overall group expenses consist mainly of expenses associated with the administrative divisions of the parent
8

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2017

company, such as general affairs and accounting divisions.
2. Segment income (loss) is adjusted with the ordinary income of quarterly consolidated statements of income.
2. Impairment losses on fixed assets and goodwill by reportable segment[Significant impairment losses on fixed assets]:
There are no applicable matters to be reported.
[Significant changes in the amount of goodwill]:
There are no applicable matters to be reported.

9