Summary of Financial Statements for Fiscal Year Ended April 2015
May 27, 2015
AIN PHARMACIEZ INC.
First Section of Tokyo Stock Exchange and Sapporo Securities Exchange
9627
URL: http://www.ainj.co.jp/
Kiichi Otani, President and Representative Director
Toshihide Mizushima, Senior Managing Director and Chief Director of Administration
TEL: +81-11-814-1000
Date of the ordinary general meeting of shareholders:
July 30, 2015
Date of scheduled payment of dividends:
July 31, 2015
Date of filing securities report:
July 31, 2015
Supplementary documents for this summary of financial statements: Yes
Explanation meeting for financial results:
Yes (for institutional investors and analysts)
Name of listed company:
Exchange listed on:
Code number:
Representative:
Inquiries:(Amounts are rounded down to the nearest million yen.)

1. Consolidated results for the fiscal year ended April 2015 (from May 1, 2014 to April 30, 2015)(Percentage figures show year-on-year changes.)(1) Consolidated operating results
Net salesYear ended April 30, 2015
Year ended April 30, 2014

Operating income

Ordinary income

Net income

Million yen%

Million yen%

Million yen%

Million yen%

187,904
170,225

10.4
10.1

11,452
10,113

13.2
4.3

11,697
10,587

10.5
2.9

6,197
5,259

17.8
3.6

(Note) Comprehensive income:Year ended April 30, 2015: ¥6,436 million (+21.2%)
Year ended April 30, 2014: ¥5,309 million (-1.8%)

Net income per
share

Diluted net
income per share

Yen

Yen

195.45165.04

Year ended April 30, 2015
Year ended April 30, 2014

Return on equity

Ordinary income
to total assets%––

Operating income
to net sales

%

13.8
13.1

%

10.9
10.7

(Reference) Equity in earnings of affiliates: Year ended April 30, 2015: ¥ – million, Year ended April 30, 2014: ¥ – million

6.1
5.9

* On October 1, 2014, the Company conducted a 2-for-1 stock split of common shares. Net income per share is calculated by deeming stock
splits to have occurred at the beginning of the previous fiscal year.

(2) Consolidated financial position
Total assets

Net assets

Million yen

114,149
101,382

As of April 30, 2015
As of April 30, 2014

Million yen(Reference) Equity capital: As of April 30, 2015: ¥47,928 million,

48,04642,240Shareholders’ equity
ratio

Net assets per share

42.0
41.5

1,511.57
1,328.43%

As of April 30, 2014: ¥42,122 million

Yen* On October 1, 2014, the Company conducted a 2-for-1 stock split of common shares. Net assets per share is calculated by deeming stock
splits to have occurred at the beginning of the previous fiscal year.

(3) Consolidated cash flows
Cash flows fromoperating activities
Million yen
Year ended April 30, 2015
Year ended April 30, 2014

14,83914,662

Cash flows frominvesting activities
Million yen(14,560)(7,749)Cash flows fromfinancing activities
Million yen

374(6,617)

Cash and cash
equivalents
at end of year
Million yen

19,38918,735

2. Dividends

Dividends per share
1Q-end2Q-end3Q-endYear-end

Annual

Yen

Yen

Yen

Yen

Yen

–
–

Year ended April 30, 2014
Year ended April 30, 2015

0.00
0.00

–
–

60.00
30.00

60.00
30.00

Total
dividends(annual)Million yen

951
951

Dividends
payout ratio

Dividends on
net assets

18.2
15.3

2.4
2.1

(consolidated)%(consolidated)%Year ending April 30, 2016
–
0.00
–
40.00
40.00
17.5
(forecast)* On October 1, 2014, the Company conducted a 2-for-1 stock split of common shares. Dividends per share for the fiscal year ended April 30,
2014 are based on the number of shares before the stock split.

3. Consolidated financial forecast for the fiscal year ending April 30, 2016 (from May 1, 2015 to April 30, 2016)(Percentage figures show year-on-year changes.)

Net sales
Million yen
First half
Full year

103,670
218,280

Operating income

Ordinary income

Million yen

Million yen

%

17.5
16.2

5,310
13,400

%

25.5
17.0

5,490
13,700Net income
attributable toowners of the parent
%

23.3
17.1

Million yen

3,060
7,230

%

21.2
16.7

Net income
per share
Yen

96.51
228.02* Notes(1) Major changes in subsidiaries during the fiscal year (changes in specified subsidiaries resulting in changes inscope of consolidation): No
Newly consolidated: –Excluded: –(2) 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.: Yes
2) Changes in accounting principles other than 1):
No3) Changes in accounting estimates:
No4) Restatement of revisions:No(3) Number of outstanding shares (common stock):1) Number of outstanding
shares (including treasury As of April 30, 2015
stock):
2) Number of shares held in
As of April 30, 2015
treasury:
3) Average number of
Fiscal year endedApril 30, 2015
shares outstanding:

31,888,212 shares As of April 30, 2014

31,888,212 shares

180,595 shares As of April 30, 2014

179,832 shares

31,707,913 sharesFiscal year endedApril 30, 2014

31,866,980 shares* On October 1, 2014, the Company conducted a 2-for-1 stock split of common shares. Number of outstanding shares (common stock) is
calculated by deeming stock splits to have occurred at the beginning of the previous fiscal year.

*Status of execution of the audit procedures of financial statements:
The procedure for the review of the financial statements under the Financial Instruments and Exchange Act was notcomplete at the moment of disclosing this summary.
*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 PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

Contents of Attachment
1. Analysis of Operating Results and Financial Position ................................................................................... 2(1) Analysis of operating results ........................................................................................................................................ 2(2) Analysis of financial position ....................................................................................................................................... 4(3) Basic policies for profit distribution, and dividends for the current fiscal year and the next fiscal year .............. 5(4) Business and other risks .............................................................................................................................................. 6

2. State of the Group .............................................................................................................................................. 93. Management Policies ....................................................................................................................................... 11(1) Basic management policies of the Company ............................................................................................................. 11(2) Target management indicators .................................................................................................................................... 11(3) The Group’s medium- to long-term management strategies .................................................................................... 11(4) Issues to be addressed ............................................................................................................................................... 12

4. Basic stance on selection of accounting standards .................................................................................... 12
5. Consolidated Financial Statements ............................................................................................................... 13(1) Consolidated balance sheet ....................................................................................................................................... 13(2) Consolidated statement of income and comprehensive income ............................................................................ 15(3) Consolidated statement of changes in net assets .................................................................................................... 18(4) Consolidated statement of cash flows....................................................................................................................... 20(Segment Information, etc.) .............................................................................................................................................. 22-1-

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

1. Analysis of Operating Results and Financial Position(1) Analysis of operating results
During the fiscal year ended April 30, 2015, the Japanese economy recovered steadily, supported by firm
consumer spending and an upturn in corporate earnings and employment conditions.
In this economic environment, the AIN PHARMACIEZ Group (the Group) worked to expand its business by
opening new dispensing pharmacies and using M&A, while also pushing ahead with the comprehensive
development of medical malls and the urban drug and cosmetic store business. The Group also aimed to boost
profitability by revitalizing existing stores and dispensing pharmacies.
For the fiscal year under review, the Group reported net sales of ¥187,904 million, an increase of 10.4% year
on year, reflecting the opening of new dispensing pharmacies and M&As. Ordinary income rose 10.5% to¥11,697 million and net income increased 17.8% year on year to ¥6,197 million.
As of the end of the fiscal year, the number of stores in the Group totaled 810, a net increase of 135 storesfrom the end of the previous fiscal year.
Performance by business segment was as follows.

(Dispensing pharmacy business)
In the dispensing pharmacy business, average sales per prescription continued to rise at existing dispensing
pharmacies due to increases in the number of new drugs and in longer-term prescriptions, offsetting the impact
from wider use of generic drugs.
Under dispensing fee revisions in April 2014, the dispensing fee system is being revised to reflect thefunctions of dispensing pharmacies in order to improve pharmaceutical management and promote dispensing
services for home healthcare patients. The revisions are also designed to encourage even wider use of genericdrugs.
In order to fulfill the new role being asked of dispensing pharmacies, the Group will build links with local
medical service providers, mainly in the area of home-based dispensing, and promote wider use of genericdrugs. The Group will also continue to implement its pharmacy-led project aimed at reviewing and rebuilding all
dispensing processes at each dispensing pharmacy in order to improve efficiency and upgrade patient
services.
The healthcare sector is facing a serious shortage of pharmacists. The Group is stepping up its efforts toaddress this issue by working to attract new graduates and enhancing pharmacist training programs. In April
2015, 229 new pharmacist graduates joined the Group, and we opened a new in-house training facility called
Ain College. The college provides support to new employees to help them pass the national pharmacist exam,
and offers training to enhance the skills of existing pharmacists.
In business development, the Group continued to push ahead with business expansion by opening new
dispensing pharmacies, primarily dispensing pharmacies near hospitals and medical malls, and through M&A
deals. During the fiscal year under review, 15 dispensing pharmacy companies joined the Group, including
Medio Pharmacy Co., Ltd. which became a subsidiary in February 2015. Medio Pharmacy Co., Ltd. is based in
Numazu City, Shizuoka Prefecture and operates a chain of 52 dispensing pharmacies, mainly in Shizuoka
Prefecture.
The dispensing pharmacy business reported net sales of ¥169,063 million, an increase of 11.6% year on year,
and segment income of ¥14,449 million, up 13.1%. During the fiscal year under review, the Group opened 159
dispensing pharmacies, including M&A deals, and closed 21 dispensing pharmacies, resulting in a total of 754.

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AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

(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 realignment that also extends to other business sectors, as well as regulatory changes
related to online sales of OTC drugs.
Against this backdrop, the Group continued to open ainz & tulpe urban drug stores.
Ainz & tulpe is a specialist, highly original drug and cosmetic store brand that the Group is rolling out in urban
areas with high customer traffic. The Group continued to reinforce merchandising lineups at ainz & tulpe stores,
particularly drug and cosmetic products, leading to higher sales at existing stores compared with the previous
fiscal year.
In addition, the Group plans to open two specialist health and beauty retail complexes focused on the ainz &tulpe brand, one in the STV Central Building in Sapporo’s Odori area (Chuo ward, Sapporo City; 10 floors) andthe other in the MIRRAZA SHINJUKU Building near the east exit of Shinjuku Station (Shinjuku ward, Tokyo: 3
floors). The Group is currently making preparations to open the new stores from summer this year.
In response to growing inbound demand, spurred by new rules from October 2014 that expand the type of
products on which overseas visitors to Japan are exempt from consumption tax, the Group now offers duty-freeservices at 28 of its drugstores (as of April 30, 2015), making a large contribution to improvements in
profitability.
The Group also actively refurbished urban stores to revitalize its store network. In December 2014 the Group
refurbished the ainz & tulpe HARAJUKU QUEST (Shibuya ward, Tokyo), which included adding organic andnatural cosmetic products to the merchandise lineup, and upgraded other urban locations such as the ainz &tulpe IKEBUKURO SEIBU (Toshima ward, Tokyo) and the ainz & tulpe frente MINAMI-OSAWA (Hachioji City,
Tokyo).
During the fiscal year under review, the Group opened a number of ainz & tulpe stores, including the ainz &tulpe SANNOMIYA Yuzawaya (Chuo ward, Kobe City), the ainz & tulpe OYAMA STATION (Oyama City, Tochigi
Prefecture), and the ainz & tulpe HIGASHI KUYAKUSHO MAE, (Higashi ward, Sapporo City), aiming toincrease the number of stores in prime locations near stations. At the same time, the Group closed six stores,
mainly in suburban locations, resulting in a total of 56 stores.
As a result, the drug and cosmetic store business reported net sales of ¥17,803 million, a decrease of 1.0%
year on year, and segment income of ¥117 million, up 394.7%.

(Other businesses)
Net sales of other businesses totaled ¥1,037 million, an increase of 35.2% year on year, and segment losses
totaled ¥614 million, an increase of 181.3% year on year.

In the fiscal year ending April 30, 2016, the dispensing pharmacy business will continue to develop new
dispensing pharmacies near hospitals and medical mall dispensing pharmacies, and actively seek M&A
opportunities. Also, the drug and cosmetic store business will work to expand its business by continuing toopen ainz & tulpe urban drug stores.
Based on these initiatives, the Group forecasts net sales for the fiscal year ending April 30, 2016 of ¥218,280
million, up 16.2% year on year, ordinary income of ¥13,700 million, up 17.1%, and net income of ¥7,230 million,
an increase of 16.7%.

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AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

(2) Analysis of financial position
1) Assets, liabilities and net assets
Consolidated current assets at the end of the fiscal year under review increased by ¥2,031 million to ¥46,365
million compared to ¥44,334 million at the end of the previous fiscal year.
This mainly reflected cash on hand and in banks of ¥19,553 million, an increase of ¥706 million comparedwith the previous fiscal year, notes and accounts receivable of ¥8,369 million, an increase of ¥1,650 million andmerchandise of ¥9,747 million, an increase of ¥168 million due to business expansion, and other accounts
receivable of ¥5,291 million, down ¥388 million.
Fixed assets at the end of the fiscal year under review increased by ¥10,735 million to ¥67,783 million
compared to ¥57,048 million at the end of the previous fiscal year.
This was mainly due to an increase in fixed assets related to investment in new stores and expansion in theasset base at consolidated subsidiaries that became part of the Group through M&A deals. Property, plant andequipment, mainly buildings and structures, increased by ¥2,888 million to ¥22,472 million, while goodwill rose
¥6,322 million to ¥26,340 million.
In addition, investments and other assets increased by ¥1,353 million year on year to ¥17,688 million, chiefly
reflecting an increase in deposits and guarantees.
Liabilities increased by ¥6,960 million to ¥66,103 million compared to ¥59,142 million at the end of theprevious fiscal year.
This primarily reflected accounts payable of ¥31,826 million, up ¥3,824 million year on year, short-term debtof ¥6,330 million, down ¥204 million, and long-term debt of ¥7,640 million, up ¥3,137 million.
As a result of the above, the balance of current liabilities increased by ¥4,083 million from the previous
year-end balance of ¥50,349 million to ¥54,433 million, and the balance of long-term liabilities increased by¥2,876 million from the previous year-end balance of ¥8,793 million to ¥11,669 million.
Net assets increased by ¥5,806 million to ¥48,046 million compared to ¥42,240 million at the end of theprevious fiscal year.
Retained earnings increased ¥5,632 million year on year to ¥31,639 million due to growth in surplus funds.
As a result of the above factors, shareholders’ equity ratio improved 0.5 percentage points to 42.0%,
compared with 41.5% at the end of the previous fiscal year.

2) Cash flows
In the fiscal year under review, cash on hand and in banks (“cash”) increased ¥653 million (3.5%) year on
year to ¥19,389 million. This reflected operating cash flow generated by dispensing pharmacy and drug andcosmetic store businesses, which was mainly used to actively invest in new store openings and M&A. Somecash was also retained to provide constant access to a certain level of funds.
Cash flows from each category and their relevant factors are as follows.
(Cash flows from operating activities)
Net cash provided by operating activities was ¥14,839 million, an increase of 1.2% year on year.
The main items that were positive for cash flow were income before income taxes and minority interests of¥10,832 million, as well as depreciation and amortization of ¥2,553 million, amortization of goodwill of ¥2,278
million, decrease in inventories of ¥969 million, and increase in notes and accounts payable-trade of ¥1,544
million related to business expansion through new store openings and M&A.
The main items that were negative for cash flow was income taxes paid of ¥5,126 million.
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AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

(Cash flows from investing activities)
Net cash used in investing activities totaled ¥14,560 million, an increase of 87.9% year on year.
This mainly reflected payments of ¥2,848 million for purchases of property, plant and equipment related tothe opening of new urban drug stores and dispensing pharmacies, and ¥10,024 million for purchases of sharesin subsidiaries due to changes in the scope of consolidation related to shares acquired in 16 companies
through M&A deals.
(Cash flows from financing activities)
Net cash provided by financing activities totaled ¥374 million, compared with cash of ¥6,617 million used theprevious fiscal year.
This was mainly attributable to net short-term debt repayment of ¥1,593 million and net long-term debt
procurement of ¥3,567 million.
Cash dividends paid of ¥951 million also had a negative impact on cash flows from financing activities.
Changes in the Group’s cash flow indicators are shown below.
Year ended April
30, 2012

Year ended April
30, 2013

Year ended April
30, 2014

Year ended April
30, 2015

Shareholders’ equity ratio (%)

39.2

40.0

41.5

42.0

Equity ratio based on market value (%)

79.6

79.3

70.3

117.9

Debt redemption term (years)

1.1

1.7

0.9

1.1

Interest coverage ratio (times)

73.6

70.3

143.0

179.2

Notes:

Shareholders’ equity ratio = Equity capital / total assets
Equity ratio based on market value = market capitalization / total assets
Debt redemption term = interest-bearing debt / operating cash flows
Interest coverage ratio = operating cash flows / interest paid
*All indicators are calculated based on consolidated financial data.
*Interest-bearing debt includes all liabilities recorded on the balance sheet on which interest is being paid.
*Operating cash flows and interest paid are calculated using the cash flows from operating activities and the interest paid on
the consolidated statements of cash flows.

(3) Basic policies for profit distribution, and dividends for the current fiscal year and the next fiscal year
The Company considers the return of profits to shareholders as an important management issue. Our basic
policy is to repay our investors proportionate to the profit we make, and to maintain these at stable levels.
Internal reserves are held to strengthen the corporate structure and in preparation for new store openings
and future development of the business. We will make effective use of these funds to generate profits to be
returned to shareholders in the future.
The Company’s basic policy is to pay dividends from retained earnings once per year at the end of the fiscal
year. The year-end dividend to be paid is determined at the ordinary general meeting of shareholders, andinterim dividends are set at the Board of Directors’ meeting. Further, the Company has stated in its Articles ofIncorporation that “When approved by the Board of Directors, interim dividends may be paid based on a record
date of October 31 each year.”
For the fiscal year under review, the Company plans to pay a dividend from retained earnings of ¥30 per
share, compared with the previous fiscal year’s ordinary dividends of ¥60. On October 1, 2014, the Company
conducted a 2-for-1 stock split of common shares. These dividends paid from retained earnings are based on
the number of shares after the 2-for-1 stock split. Based on the number of shares before the stock split, thefull-year dividend is ¥60 per share, the same as in the previous fiscal year.
In view of our profit forecasts, plans for investment and other factors, we intend to pay an ordinary dividend
from retained earnings of ¥40 per share in the fiscal year ending April 30. 2016, an increase of ¥10 from the-5-

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

fiscal year ended April 30, 2015.
(4) Business and other risks
The following factors may affect the Group’s operating results, stock price and financial position. Statementsin the text referring to the future reflect the judgment of the Group at the end of the fiscal year under review.

1) Laws and regulations(i) Regulations under the Law for Ensuring the Quality, Efficacy, and Safety of Pharmaceuticals and Medical
Devices
We operate dispensing pharmacy business under various permits, licenses, registrations and notifications
including those set forth by the Law for Ensuring the Quality, Efficacy, and Safety of Pharmaceuticals andMedical Devices (the Pharmaceutical and Medical Device Law), the Health Insurance Law, and thePharmacists Law, under the supervision of the Ministry of Health, Labour and Welfare, and of prefectural healthand welfare departments.
The drugstore business in our drug and cosmetic store business also involves drug sales, which are similarly
regulated under the Pharmaceutical and Medical Device Law.
The main ones are as follows.
Approval, registration, appointment, license or
notification

Term ofvalidity

Related law or ordinance

Permit to open a pharmacy

6 years

Pharmaceutical and Medical
Device Law

Prefectural Governors

GrantorInsurance pharmacy certification

6 years

Health Insurance Law

Local welfarecommissioners of the
Health and Welfare of the
Ministry of Health, Labourand Welfare

License to sell narcotic drugs

2 years

Narcotics and Psychotropics
Control Law

Prefectural Governors

Notification of sales of medical equipment

Indefinite

Pharmaceutical and Medical
Device Law

Prefectural Governors

Business selling highly controlled medical
equipment

6 years

Pharmaceutical and Medical
Device Law

Prefectural Governors

Medical product sales permit (Note)

6 years

Pharmaceutical and Medical
Device Law

Prefectural Governors,
etc.

Note: Under Article 25 of the Pharmaceutical and Medical Device Law, medical product sales permits fall into the three
categories: Store-based drug sellers, drug sellers by household distribution and drug sellers by wholesale distribution.
The Group’s drug and cosmetic store business has a permit for store-based drug sales under this law. If the Group
becomes the subject of an order of revocation or suspension of business license by the competent authorities due to an
act committed in the Group’s dispensing pharmacy and drug and cosmetic store businesses, which constitutes aviolation of law set forth in Paragraph 1, Article 75 of the Pharmaceutical and Medical Device Law, items in Article 80 of
the Health Insurance Law, or Paragraph 1, Article 51 of the Narcotics and Psychotropic Control Law, the Group’s
performance may be affected.

(ii) Easing of drug sales regulations
In sales of over-the-counter (OTC) drugs, the Pharmaceutical and Medical Device Law classifies drugs into
different categories based on risk. Only qualified pharmacists are permitted to sell drugs requiring guidanceand category 1 drugs, while registered sellers, as well as pharmacists, are permitted to sell category 2 andcategory 3 drugs.
In addition, the “Law for Partial Revision of the Pharmaceutical Affairs Law” (enacted June 12, 2014) ended
restrictions on the sale of OTC drugs online. Factors such as the entry into the market of firms from otherindustries as a result of a continuing trend in the future to deregulate drug sales may affect the Group’s
performance.
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AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

2) Details of business
The Group’s dispensing pharmacy business operates a chain of dispensing pharmacies. These dispensing
pharmacies are mainly located near major hospitals (national health insurance scheme dispensing pharmacies,
located near hospitals for user convenience) and in medical malls developed by the Group(national healthinsurance scheme dispensing pharmacies, located near mixed medical facilities for user convenience).
As the dispensing pharmacy business accounted for 90.0% of net sales in the fiscal year under review, weplan to continue the multi-store operation mainly based on dispensing pharmacies. Accordingly, the Group’s
operating results may be affected by the success or failure of the store opening policies and by trends in store
openings by competitors in the same industry.
Furthermore, sales of dispensing pharmacies significantly depend on the medical institutions that write
prescriptions. Therefore, uncertainties such as the issuance of non-hospital prescriptions by the medical
institutions or suspension / discontinuation of operations thereof may affect the Group’s performance.

3) Industry trends
The revenues in our dispensing pharmacy business come from pharmacy operations involving thedispensing and supplying of drugs based on prescriptions. The drug prices and dispensing fees are set by the
Ministry of Health, Labour and Welfare. As a way to contract medical expenses, both medical treatment feesand drug prices are being revised incrementally. In the future as well, changes in profit structure resulting fromfactors such as revisions in the medical treatment fee system could continue to affect the Group’s performanceand financial position.

4) Securing qualified staff
Dispensing pharmacies and drugstores (Stores for Category 1 Drugs) are required by the Pharmaceuticaland Medical Device Law to have a pharmacist on site; the Pharmacists Law stipulates that the dispensing ofdrugs must be handled by a pharmacist. The Group continues to have a policy of expansion by aggressively
opening new stores, but if it becomes difficult to secure qualified pharmacists, this could affect our store
openings and the Group’s performance.

5) Risks of loss of trust in the Company(i) Dispensing operation
In our dispensing pharmacy business, pharmacists dispense and supply prescription drugs that affect thehuman body. This business carries the risk that medical accidents might be caused through dispensing errors.
The Group recognizes that any medical accidents could have a severely damaging effect on society’s
confidence in the Group, and we place the highest priority on measures to avoid the risk from all aspects.
Primary risk prevention measures are as follows.
•

Training programs for newly graduated pharmacists and mid-career pharmacists when joining theCompany•

A continuing training program aimed at improving skills of pharmacists•

Pharmacy manager conferences attended by all pharmacy managers, to nurture supervisors•

Development of a dispensing error prevention system (PhAIN) that uses Personal Digital Assistants(PDAs) developed with a dispensing equipment manufacturer. Development and introduction ofpharmacy equipment that makes use of information technology, such as the automation ofdispensing operations.

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AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015•

Use of in-house manuals for the dispensing operation and a system of observing rules set by theInternal Audit Office•

Establishment of a Safety Policy Office specializing in measures to prevent dispensing errors(ii) Protection of personal data
We possess patient data in the dispensing pharmacy business, including medical histories and prescription
information, and we possess personal data in the drug and cosmetic store business obtained from the Ainz
Point Club Card and Tulpe Mobile Club.
The Group has completed development of personal information protection systems and rules for the handlingof such information. The Company acquired the Privacy Mark accreditation in the healthcare, medical andsocial service fields.
However, we believe it is possible that any accidental or illegal leakage of personal data may not only affect
the Group’s performance but also lead to a loss of society’s confidence in the Group.

6) Risk in business strategy
The Group has promoted the expansion of the business scale of dispensing pharmacies through actively
promoting new store openings and M&A.
Our basic policies regarding M&A strategy require us to carefully examine target companies and determine
the amount to be paid for acquisitions thereof in order to stably secure a profitability level that exceeds theamortization of goodwill to be incurred. If matters do not go as planned, however, we may incur losses on
valuation of shares in subsidiaries and impairment losses on goodwill, which may have an adverse impact on
the Group’s operating results and financial position.

7) Interest rate risks
In the Group’s promotion of business expansion based on actively promoting new store openings and M&A,
costs for ordinary store openings are covered by internal funds within the range of operating cash flow, while inlarge-scale M&A, costs are sometimes financed by borrowings from financial institutions.
In order to ensure flexible access to funds to support these activities, the Group maintains a certain level ofliquidity on its balance sheet. As of the end of the fiscal year under review, cash on hand and in banks totaled¥19,553 million, compared with a total balance of short- and long-term debt of ¥13,970 million.
We focus on possibility of return on investment and seek to reduce interest-bearing debts through efficientinvestment in implementing M&A deals. However, if the Group fails to secure an adequate return on its M&A
investment, or due to interest rate fluctuations associated with conditions in financial market, the Group’s
financial position and operating results including interest payable may be affected.

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AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

2. State of the GroupThe Group consists of AIN PHARMACIEZ INC. (the Company), 38 subsidiaries and one affiliated company.

(1) Dispensing pharmacy business
The Company operates and franchises dispensing pharmacies, and engages in consulting on the opening ofdispensing pharmacies.
The subsidiaries AIN MEDIO Inc., DAICHIKU Co., Ltd., Asahi Pharmacy Co., Ltd., and 30 other subsidiaries
operate dispensing pharmacies.
MEDIWEL Corp. is engaged in a medical-related consulting business and staff dispatching/introduction,
primarily of doctors and pharmacists, Medical Development Co., Ltd. is engaged in a medical-related
consulting business, and WHOLESALE STARS Co., Ltd. sells generic drugs and other merchandise.

(2) Drug and cosmetic store business
The Company engages in the management of drugstores (sales of drugs, quasi-drugs, cosmetics, food,general merchandise, etc.), and in consulting on the opening of shopping centers.

(3) Other businesses
The Company and subsidiary Medical Development Co., Ltd., Diagnose Inc. and JAPAN MEDICALDEVELOPMENT Co., Ltd. are in the building leasing business.

An organization chart of the business is as follows.

-9-

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

Notes: *1 consolidated subsidiary*2 affiliated company not accounted under the equity method*3 non-consolidated subsidiary- 10 -

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

3. Management Policies(1) Basic management policies of the Company
The Company’s main businesses are the dispensing pharmacies business, which dispense based onprescriptions, and the drug and cosmetic store business of selling products, primarily pharmaceuticals andcosmetics. Because both of these businesses contribute to people’s health, we bear an important social
responsibility.
We believe the Company’s mission is not only to grow its profits and increase shareholder value throughaggressively opening new stores as the separation of dispensary from medical practice improves, but also towork for continuous improvements in safety and specialized skills in this business, given that we are a
Company that can affect people’s lives.
Accordingly, our basic management policy is “to fulfill our social mission by working to eliminate medicine
dispensing errors and other business risks, and by creating pharmacies that customers can be confident invisiting, while placing weight on actively expanding the business in accordance with market conditions.”(2) Target management indicators
While working to expand our corporate scale by actively opening new stores, the Group also focuses on
strengthening its financial structure and increasing shareholder value.
In the fiscal year under review, the Group achieved ROA of 5.8% and ROE of 13.8%, compared with targetsof 4.5% and 15.0%, respectively.

(3) The Group’s medium- to long-term management strategies
The Group’s core businesses are the nationwide development of dispensing pharmacies through active newstore openings and M&A activities, and the development of urban drug stores, focusing primarily on drugs andcosmetics, in major cities across Japan. We aim both to expand the scale of these businesses and to increase
shareholder value.
In the dispensing pharmacy business, each Group company will continue to work on developing highvalue-added “dispensing pharmacies at the heart of local communities.” The Group will also actively implement
an M&A strategy based on due diligence of potential candidates.
The Group has a policy of expanding still further the utilization of generic drugs and has actively promoted
their greater utilization through a sales system for generic drugs at WHOLESALE STARS Co., Ltd., awholesaling subsidiary that specializes in generic drugs, and increased efforts to educate patients throughout
all Group pharmacies.
In addition, we will work to assure the safety of our patients, to improve customer service and to increasebusiness efficiency by reinforcing education and training, and by developing and introducing medicine
dispensing equipment using the latest technology.
In the drug and cosmetic store business, the Group is aiming for further growth by expanding its chain of ainz
& tulpe urban drug stores to cities across Japan, specializing in drug and cosmetics products and creating aclear difference with competing drugstores.
As a result of the above, our medium- to long-term management strategies are based on the following
policies.
1) In dispensing pharmacies, we will work to increase the expertise of our pharmacists using Ain College andother improvements to training programs, actively participate in projects aimed at promoting home-based
healthcare and 24-hour dispensing services and encourage wider use of generic drugs, harnessing all theGroup’s capabilities to create advanced “dispensing pharmacies at the heart of local communities.”- 11 -

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

2) In business development, we plan to open around 50 new pharmacies each year. We also aim to expand theGroup’s operations through business development using M&A.
3) We will actively promote the introduction into the Group of the latest dispensing equipment and developing
dispensing technologies that make use of IT, and improve customer safety, service and the efficiency ofpharmacy management through the integrated application of individual devices and systems.
4) We will enhance our profitability with improving flexibility and operational efficiency through streamlining
measures such as organizational restructuring and personnel exchanges. We will also enrich mutuallycomplementary cooperative systems for operations that are common across multiple companies such as
business development system that suit their locations, recruitment of pharmacists and expanding the use ofgeneric drugs.
5) In the drug and cosmetic store business, we plan to open around five new ainz & tulpe urban drugstoreseach year in retail complexes in all Japan’s major cities, reinforce merchandise lineups based on local needs
and create a clear difference with competing drugstores.
6) We aim to enhance the earnings capabilities of stores by using our loyalty point systems, Ainz Point Club
Card and Tulpe Mobile Club, to expand the customer base, and by implementing effective sales promotion
using a mix of online media, SNS and print media advertising.

(4) Issues to be addressed
Amid wide-ranging debate about the future of Japan’s non-hospital drug prescription system, the dispensing
pharmacy sector is being called on to contribute to community healthcare through the provision of high-quality
patient services, leading to a significant expansion in the traditional role and responsibilities of dispensing
pharmacies.
The Group will work to provide high-quality healthcare services. Specifically, we will continue to implement
our pharmacy-led project to improve operational efficiency at existing dispensing pharmacies, hire new
pharmacists, upgrade training programs and invest in facilities to enhance the functions of dispensing
pharmacies, and promote wider use of generic drugs using our specialist generic drug wholesale subsidiary
WHOLESALE STARS Co., Ltd. In addition, we will expand the business through new store openings and M&A,
continuing to implement our business strategy that maximizes economies of scale.
In the drug and cosmetic store business, we will reinforce the ainz & tulpe brand by accelerating openings of
new large-scale stores in urban retail complexes near stations, where customer traffic is likely to be higher.
We will also invest to expand the drug and cosmetic store business so that earnings are on par with thedispensing pharmacy business. Specifically, we will implement new initiatives, such as developing andoperating large-scale specialist health and beauty retail complexes with ainz & tulpe as the key tenant.

4. Basic stance on selection of accounting standards
The Group has adopted Japanese accounting standards in order to facilitate comparison with other domestic
companies in the same sector.

- 12 -

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

5. Consolidated Financial Statements(1) Consolidated balance sheet

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
Accumulated depreciation
Buildings and structures, net
LandConstruction in progress
Other property, plant and equipment
Accumulated depreciation
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
Long-term loans
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- 13 -(Thousand yen)Previous fiscal year
(As of April 30, 2014)

Current fiscal year
(As of April 30, 2015)

18,846,760
6,718,670
9,578,858
180,570
1,245,406
708,297
5,679,761
1,376,190–
44,334,515

19,553,423
8,369,451
9,747,115
162,635
894,440
739,342
5,291,030
1,765,517(157,053)
46,365,901

17,568,621(7,606,198)
9,962,423
6,698,782
681,640
6,490,314(4,249,228)
2,241,085
19,583,933

21,191,691(9,513,155)
11,678,535
7,931,761
519,169
8,119,554(5,776,678)
2,342,875
22,472,342

20,017,440
1,111,957
21,129,397

26,340,056
1,283,021
27,623,077

2,559,386
1,801,385
1,068,129
8,081,230
3,065,102(240,307)
16,334,926
57,048,257
101,382,772

2,872,382
1,369,265
984,239
9,710,040
3,275,023(522,385)
17,688,566
67,783,986
114,149,888

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

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
Other current liabilities
Total current liabilities
Long-term liabilities
Long-term debt
Lease obligations
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 (loss)
Unrealized holding gains (losses) on securities
Remeasurement of defined benefit plans
Total accumulated other comprehensive income (loss)
Minority interests
Total net assets
Total liabilities and net assets- 14 -(Thousand yen)Previous fiscal year
(As of April 30, 2014)

Current fiscal year
(As of April 30, 2015)

28,002,426
6,535,438
3,079,805
8,686,700
1,149,395
11,934332,315
2,551,384
50,349,400

31,826,516
6,330,773
2,320,567
9,052,200
1,353,380
11,751
338,824
3,199,345
54,433,358

4,502,810
1,454,125
1,927,033
909,311
8,793,281
59,142,681

7,640,133
1,341,266
1,636,186
1,052,395
11,669,982
66,103,340

8,682,976
7,872,970
26,007,464(417,338)
42,146,073

8,682,976
7,872,970
31,639,894(419,311)
47,776,529

34,590(58,224)(23,633)
117,651
42,240,091
101,382,772

227,061(75,210)
151,851
118,166
48,046,547
114,149,888

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

(2) Consolidated statement of income and comprehensive income
Consolidated statement of income(Thousand yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Advertising expenses
Promotion expenses
Salaries, allowances and bonuses
Provision of allowance for doubtful accounts
Provision for bonuses
Provision for directors’ bonuses
Retirement benefit expenses
Provision for reward obligations
Legal and employee benefits expenses
Correspondence and transportation expenses
Lease expenses
Rent expenses
Depreciation expenses
Amortization of goodwill
Taxes
Other
Total selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Gains on investments in partnership
Commissions received
Real estate rental revenue
Gains on donations of fixed assets
Consignment income
Technical advisory fee
Other non-operating income
Total non-operating income
Non-operating expenses
Interest expenses
Losses on sales of accounts receivables
Real estate rental expenses
Provision of allowance for doubtful accounts
Other non-operating expenses
Total non-operating expenses
Ordinary income- 15 -

Previous fiscal year
(May 1, 2013
to April 30, 2014)
170,225,754
144,476,833
25,748,921

Current fiscal year
(May 1, 2014
to April 30, 2015)
187,904,956
158,943,804
28,961,151

759,900
267,1183,600,585–
249,710
11,93490,467332,315
1,017,920
504,803
151,780
2,858,830
926,650
1,402,261
611,476
2,849,720
15,635,476
10,113,445

1,103,910
326,358
3,727,701
148,140
294,028
11,751
89,994
338,824
1,077,826
522,911132,016
2,955,173
1,172,814
1,363,887
891,5033,352,159
17,509,004
11,452,147

76,14735,27645,40233,07374,164
12,315
144,456
66,064
304,760
791,662

66,33733,153
108,785
50,156
159,217
12,672
157,150
54,879192,198
834,551

101,870
85,564
44,592–85,963317,991
10,587,115

84,087
81,17688,653
282,600
52,334
588,851
11,697,847

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015
(Thousand yen)Previous fiscal year
(May 1, 2013
to April 30, 2014)
Extraordinary income
Gains on sales of fixed assets
Gains on sales of investments in securities
Surrender value of insurance
Other extraordinary income
Total extraordinary income
Extraordinary losses
Losses on disposal and sales of fixed assets
Losses on devaluation of investments in securities
Impairment losses on fixed assets
Directors’ retirement benefits
Other extraordinary losses
Total extraordinary losses
Income before income taxes and minority interests
Income taxes – current
Income taxes – deferred
Total income taxes
Income before minority interests
Minority interests in income
Net income- 16 -

Current fiscal year
(May 1, 2014
to April 30, 2015)

4,194
49,667214,095
9,523
277,480

21,736
7,141
–
1,241
30,118336,366519
189,875–
71,886598,647
10,265,949
5,206,903(273,959)
4,932,943
5,333,005
73,606
5,259,398

345,891
6,776
371,036
106,960
64,840895,505
10,832,460
4,428,100
143,526
4,571,626
6,260,833
63,662
6,197,170

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

Consolidated statement of comprehensive income

Income before minority interests
Other comprehensive income
Unrealized holding gains (losses) on securities
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income
Total comprehensive income
Comprehensive income attributable to shareholders of
the parent
Comprehensive income attributable to minority interests- 17 -

Previous fiscal year
(May 1, 2013
to April 30, 2014)
5,333,005(Thousand yen)
Current fiscal year
(May 1, 2014
to April 30, 2015)
6,260,833(23,265)–(23,265)
5,309,739

192,471(16,985)
175,485
6,436,319

5,236,133

6,372,656

73,606

63,662

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

(3) Consolidated statement of changes in net assets
Previous fiscal year (May 1, 2013 to April 30, 2014)(Thousand yen)
Shareholders’ equity
Common stock
Balance at the beginning ofcurrent year

Capital surplus

Retained earnings

Treasury stock

Total shareholders’equity8,682,976

7,872,970

21,704,510(5,837)

38,254,620

8,682,976

7,872,970

21,704,510(5,837)

38,254,620

Cumulative effect ofchanges in accounting
policies
Balance at the beginning ofcurrent year reflectingchanges in accounting
policies
Net changes during the year
Cash dividends paid

(956,444)(956,444)

Net income

5,259,398

5,259,398

Acquisition of treasurystock(411,501)(411,501)

Net changes in items
other than shareholders’equityTotal changes during theyear
Balance at the end ofcurrent year––

4,302,954(411,501)

3,891,453

8,682,976

7,872,970

26,007,464(417,338)

42,146,073

Accumulated other comprehensive income

Balance at the beginning ofcurrent year

Valuation difference on
available-for-salesecurities

Remeasurements ofdefined benefit plans

Total accumulated
other comprehensive
income (loss)

Minority interests

Total net assets

57,855–57,85544,04438,356,520

57,855–57,85544,04438,356,520

Cumulative effect ofchanges in accounting
policies
Balance at the beginning ofcurrent year reflectingchanges in accounting
policies
Net changes during the year
Cash dividends paid

(956,444)

Net income

5,259,398

Acquisition of treasurystock(411,501)

Net changes in items
other than shareholders’equity(23,265)(58,224)(81,489)

73,606(7,883)

Total changes during theyear(23,265)(58,224)(81,489)

73,606

3,883,570

Balance at the end ofcurrent year

34,590(58,224)(23,633)

117,651

42,240,091- 18 -

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015
Current fiscal year (May 1, 2014 to April 30, 2015)(Thousand yen)
Shareholders’ equity
Common stock
Balance at the beginning ofcurrent year

8,682,976

Capital surplus

Retained earnings

7,872,970

Cumulative effect ofchanges in accounting
policies
Balance at the beginning ofcurrent year reflectingchanges in accounting
policies

Total shareholders’equityTreasury stock

26,007,464(417,338)

42,146,073

386,510

8,682,976

7,872,970

386,510

26,393,975(417,338)

42,532,583

Net changes during the year
Cash dividends paid

(951,251)(951,251)

Net income

6,197,170

6,197,170

Acquisition of treasurystock(1,973)(1,973)

5,245,919(1,973)5,243,945

31,639,894(419,311)

47,776,529

Net changes in items
other than shareholders’equityTotal changes during theyear
Balance at the end ofcurrent year

8,682,976

7,872,970

Accumulated other comprehensive income
Valuation difference on
available-for-salesecurities
Balance at the beginning ofcurrent year

Remeasurements ofdefined benefit plans

34,590(58,224)

Total accumulated othercomprehensive income(loss)(23,633)

Minority
interests
117,651

Cumulative effect ofchanges in accounting
policies
Balance at the beginning ofcurrent year reflectingchanges in accounting
policies

Total net
assets42,240,091
386,510

34,590(58,224)(23,633)

117,651

42,626,601

Net changes in items during
the year
Cash dividends paid

(951,251)

Net income

6,197,170

Acquisition of treasurystock(1,973)

Net changes other thanshareholders’ equity

192,471(16,985)

175,485515

176,000

Total changes during theyear

192,471(16,985)

175,485515

5,419,946

Balance at the end ofcurrent year

227,061(75,210)

151,851

118,166

48,046,547- 19 -

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

(4) Consolidated statement of cash flows
Previous fiscal year
(May 1, 2013
to April 30, 2014)
Cash flows from operating activities
Income before income taxes and minority interests
Depreciation and amortization
Amortization of goodwill
Impairment losses on fixed assets
Impairment losses on investments in securities(Decrease) increase in allowance for doubtful accounts
Increase in reserve for reward obligations
Increase in defined benefit liability
Increase in allowance for bonuses to employees
Decrease in allowance for bonuses to directors
Interest and dividend income
Interest expenses
Gains on investments in partnerships
Gains on donations of property, plant and equipment
Gains on sales of investments in securities
Losses on disposal and sales of fixed assets
Decrease in accounts receivable(Increase) decrease in inventories
Increase in other assets
Decrease in other accounts receivable
Increase in accounts payable
Increase (decrease) in other liabilities
SubtotalInterest and dividends received
Interest paid
Income taxes paid
Net cash provided by operating activities- 20 -

10,265,949
2,258,946
2,033,305
189,875519(44,561)
16,396
153,792
38,304(995)(111,424)
101,870(45,402)(12,315)(49,667)
332,171
1,110,209(1,485,281)(199,126)
1,551,899
3,075,097
84,48019,264,042
105,264(102,520)(4,603,956)
14,662,829(Thousand yen)

Current fiscal year
(May 1, 2014
to April 30, 2015)

10,832,460
2,553,938
2,278,004
371,0366,776
419,514
6,508
114,834
130,020(183)(99,490)
84,087(108,785)(12,672)(7,141)
324,155
455,881969,970(214,263)
414,967
1,544,935(116,508)
19,948,048
100,971(82,809)(5,126,261)
14,839,948

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

Previous fiscal year
(May 1, 2013
to April 30, 2014)
Cash flows from investing activities
Payments for purchases of property, plant andequipment
Proceeds from sales of property, plant and equipment
Payments for purchases of investments in securities
Proceeds from sales of investments in securities
Purchases of subsidiaries’ shares resulting in obtaining
controls
Payments for loans receivable
Proceeds from collections of loans receivable
Payments for investments in capital
Proceeds from returns of investments in capital
Payments for purchase of intangible fixed assets
Proceeds from sales of intangible assets
Increase in other investments
Proceeds from withdrawal of time deposits
Payments for time deposits
Net cash used in investing activities
Cash flows from financing activities
Net decrease in short-term loans payable
Proceeds from long-term debts
Repayments of long-term debts
Repayments of lease obligations
Payments for purchase of treasury stock
Cash dividends paid
Net cash (used in) provided by financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of the year
Cash and cash equivalents at end of the year

- 21 -(Thousand yen)

Current fiscal year
(May 1, 2014
to April 30, 2015)(3,460,202)(2,848,807)

466,089(120,560)
322,362

98,167(145,352)
559,547(2,410,135)(10,024,858)(3,172,743)
2,545,485
(33)
1,404
(793,994)
8,015(1,150,588)
27,607(12,112)(7,749,405)(2,233,281)
2,655,247(6)
64(926,862)
665(1,862,825)
260,513(93,204)(14,560,990)(318,138)
137,080(4,510,186)(558,435)(411,501)(956,444)(6,617,625)
295,798
18,439,646
18,735,445(1,593,327)
8,650,097(5,082,420)(646,430)(1,973)(951,251)374,694
653,651
18,735,445
19,389,097

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

(Segment Information, etc.)
a. Segment information
1. Description of the reportable segments
The Company’s reportable segments consist of those of its components for which it is possible to obtainseparate financial information that is examined by its Board of Directors on a regular basis for the purpose of
deciding on the allocation of corporate resources and assessing business performance.
The Group’s business comprises three units that together represent its main business units, namely,
dispensing pharmacy business that consists of operation of dispensing pharmacies, selling of generic drugs,
temporary staff/recruiting and consulting services, and drug and cosmetic store business that consists of the
management of urban and suburban drug and cosmetic stores as well as other businesses that consist
mainly of real-estate leasing services. The formulation and examination of business strategy is conductedindividually for each business.
Accordingly, the reportable segments of the Group are composed of three units, namely, dispensing
pharmacy business, drug and cosmetic store business and other businesses.
2. Methods to determine the amounts of net sales, income or losses, assets, liabilities and other items byreportable segment
The methods used for accounting for the reportable business segments are generally similar to thosedescribed in the Basic Important Matters for Preparation of Consolidated Financial Statements.
The income figures for the reportable segments are expressed at the ordinary income level. Intersegment
sales and transfers are based on prevailing market prices.

- 22 -

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

3. Sales, income (loss), assets, liabilities and other items for each reportable segment
I. Previous fiscal year (May 1, 2013 to April 30, 2014)(Thousand yen)
Reportable segments
Adjustments(Note) 1

Consolidated(Note) 2

170,225,754–

170,225,754

479,204

479,204(479,204)–

17,985,552

1,246,635

170,704,958(479,204)

170,225,754

12,772,296

23,793(218,597)

12,577,492(1,990,376)

10,587,115

85,490,807

7,649,913

5,419,057

98,559,778

2,822,994

101,382,772

Depreciation
and amortization

1,632,709

234,744

90,502

1,957,956

129,0142,086,970

Amortization of
goodwill

2,028,265

5,040

–

2,033,305–

2,033,305

Impairment losses

77,263

106,459

6,152

189,875–

189,875

Increase of tangible
and intangible assets

3,062,145

369,182

377,675

3,809,003

759,987

4,568,991

Dispensing
pharmacy

Drug andcosmetic
store

Sales to third parties

151,472,771

17,985,552

767,431

Intersegment sales––

Total sales

151,472,771

Segment income (loss)
Segment assets

Other

Total

Sales

Other

Notes:

1. Segment income (loss) in “Adjustments” totaling (¥1,990,376 thousand) includes ¥1,781,691 thousand in overall
group expenses, ¥284,509 thousand in losses that may not be allocated to the reporting segments, and(¥75,823
thousand) in elimination due to intersegment transactions.
The overall group expenses consist mainly of expenses associated with the administrative divisions of the parent
company, such as general affairs and accounting divisions.
Segment assets in “Adjustments” totaling ¥2,822,994 thousand consist mainly of assets associated with theadministrative divisions of the parent company and the difference in elimination of intersegment transactions.
2. Segment income is adjusted with the ordinary income of consolidated statements of income.

- 23 -

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

II. Current fiscal year (May 1, 2014 to April 30, 2015)(Thousand yen)
Reportable segments
Adjustments(Note) 1

Consolidated(Note) 2

187,904,956–

187,904,956

323,425

323,425(323,425)–

17,803,967

1,361,118

188,228,382(323,425)

187,904,956

14,449,163

117,708(614,986)

13,951,885(2,254,037)

11,697,847

105,238,155

8,852,226

6,852,940

120,943,323(6,793,434)

114,149,888

Depreciation
and amortization

1,810,482

206,693

131,898

2,149,074

146,658

2,295,733

Amortization of
goodwill

2,271,358

–

6,646

2,278,004–

2,278,004

Impairment losses

166,136

144,352

60,547

371,036–

371,036

Increase of tangible
and intangible assets

2,525,818

553,667

1,268,195

4,347,681

40,414

4,388,095

Dispensing
pharmacy

Drug andcosmetic
store

Other

Sales to third parties

169,063,296

17,803,967

1,037,692

Intersegment sales––

Total sales

169,063,296

Segment income (loss)
Segment assets

Total

Sales

Other

Notes:

1. Segment income (loss) in “Adjustments” totaling (¥2,254,037 thousand) includes ¥2,007,602 thousand in overall
group expenses, ¥343,514 thousand in losses that may not be allocated to the reporting segments, and(¥97,079
thousand) in elimination due to intersegment transactions.
The overall group expenses consist mainly of expenses associated with the administrative divisions of the parent
company, such as general affairs and accounting divisions.
Segment assets in “Adjustments” totaling (¥6,793,434 thousand) consist mainly of assets associated with theadministrative divisions of the parent company and the difference in elimination of intersegment transactions.
2. Segment income is adjusted with the ordinary income of consolidated statements of income.

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AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015b. Related information
I. Previous fiscal year (May 1, 2013 to April 30, 2014)
1. Information by product and service
This disclosure has been omitted because the same information is disclosed under Segment Information.
2. Information by region(1) Net sales
This disclosure has been omitted because the Group had no sales to external customers outside Japan
during the fiscal year.
(2) Property, plant and equipment
This disclosure has been omitted because the Group had no property, plant and equipment locatedoutside Japan at the balance sheet date.

II. Current fiscal year (May 1, 2014 to April 30, 2015)
1. Information by product and service
This disclosure has been omitted because the same information is disclosed under Segment Information.
2. Information by region(1) Net sales
This disclosure has been omitted because the Group had no sales to external customers outside Japan
during the fiscal year.
(2) Property, plant and equipment
This disclosure has been omitted because the Group had no property, plant and equipment locatedoutside Japan at the balance sheet date.
c. Information regarding impairment losses of fixed assets for each reported segment
Previous fiscal year (May 1, 2013 to April 30, 2014)
This disclosure has been omitted because the same information is disclosed under Segment Information.
Current fiscal year (May 1, 2014 to April 30, 2015)
This disclosure has been omitted because the same information is disclosed under Segment Information.

- 25 -

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for Fiscal Year Ended April 30, 2015

d. Information about goodwill amortization amount and year-end balance for each reportable segment
Previous fiscal year (May 1, 2013 to April 30, 2014)(Thousand yen)
Dispensing
pharmacybusiness

Drug andcosmetic store
business

Amortization of current fiscal year

2,028,265

5,040

–

–

2,033,305

Balance at the end of current fiscal year

20,017,440

–

–

–

20,017,440

Otherbusinesses

Corporate /Eliminations

Total

Current fiscal year (May 1, 2014 to April 30, 2015)(Thousand yen)
Dispensing
pharmacybusiness

Drug andcosmetic store
business

Amortization of current fiscal year

2,271,358

–

6,646

–

2,278,004

Balance at the end of current fiscal year

26,286,881–

53,175–

26,340,056

Otherbusinesses

e. Information about gains on negative goodwill for each reported segment
Previous fiscal year (May 1, 2013 to April 30, 2014)
There are no applicable matters to be reported.
Current fiscal year (May 1, 2014 to April 30, 2015)
There are no applicable matters to be reported.

- 26 -

Corporate /Eliminations

Total