〔Delayed〕The original disclosure in Japanese was released on February 14, 2018 at 15:00 (GMT+9)

February 14, 2018

Tsukada Global Holdings Inc.
Consolidated Earnings Report for the Fiscal Year ended December 31, 2017
(Japanese GAAP)
Stock listing: Tokyo Stock Exchange (First Section)
Securities code: 2418
URL: http://www.tsukada-global.holdings/en/
Representative: Masayuki Tsukada, President and CEO
Information contact: Masahiro Yamazaki, Manager, Finance &Tel: +81-3-5464-0081
Accounting Department
Scheduled dates:
Annual general meeting of shareholders:March 29, 2018
Filing of statutory year-end financial report:
March 29, 2018
Dividend payout:
March 30, 2018
Supplementary materials to year-end financial results available: Yes
Year-end earnings presentation held: Yes (targeted at institutional investors and analysts)(Amounts rounded down to the nearest million yen)

1. Consolidated Performance for the Fiscal Year ended December 31, 2017
(January 1, 2017 – December 31, 2017)(1) Consolidated Operating Results
Net sales(Percentages indicate year-on-year changes)
Operating income

Ordinary income

Profit attributable toowners of the parent
million yen%

million yen%
million yen%
million yen%
Year ended
57,253
3.4
4,268
21.4
4,398
22.2
December 31, 2017
Year ended
55,3652.9
3,515(34.8)
3,598(33.7)
December 31, 2016
Note: Comprehensive income: Year ended December 31, 2017:
2,046 million yen (-6.8%)
Year ended December 31, 2016:
2,194 million yen (-38.8%)
Diluted profit
Ordinary income
ProfitReturn on equity
per shareper share
to total assets
yen
yen
%
%
Year ended
46.19
42.31
6.6
5.2
December 31, 2017
Year ended
40.37
36.00
6.1
4.4
December 31, 2016
Reference: Equity in (earnings) losses of affiliates:
Year ended December 31, 2017: - million yen
Year ended December 31, 2016: - million yen

2,203

12.9

1,951

(49.7)

Operating income
to net sales
%
7.5
6.3

(2) Consolidated Financial Position

December 31, 2017

Total assets
million yen
84,447

Net assets
million yen

40.5

Net assets per shareyen
717.1638.5

683.81Equity ratio%
35,78184,752
34,228December 31, 2016
Reference: Total equity: December 31, 2017: 34,208 million yen
December 31, 2016: 32,618 million yen
Total equity=Shareholders’ equity plus total accumulated other comprehensive income.

(3) Consolidated Cash Flows
Cash flows fromoperating activities
million yen

million yen

Year ended
December 31, 2017
Year ended
December 31, 2016

Cash and cash
equivalents at end of
periodmillion yen

Cash flows fromfinancing activities

Cash flows frominvesting activities

million yen

7,062(3,976)(3,573)

14,896

6,559(12,352)

3,131

15,3802. Dividends
Dividend per share
Total
dividends

Year ended
December 31, 2016
Year ended
December 31, 2017
Year ending
December 31, 2018
(Forecast)Rate of total
Dividend
dividend to
payout ratio
net assets(consolidated)(consolidated)%%

End-Q1yen

End-Q2yen

End-Q3yen

Year-endyen

Annual total
yen

-

5.00

-

5.00

10.00

486

24.8

1.5

-

5.00

-

5.00

10.00

477

21.6

1.4

-

5.00

-

5.00

10.00

million yen

16.0

3. Earnings Forecast for the Fiscal Year ending December 31, 2018
(January 1, 2018 – December 31, 2018)(Percentages indicate year-on-year changes)
Net sales
million yen%

Profit attributable toProfit%owners of the parent
million yen%

per shareyen

Operating income

Ordinary income

million yen

million yen%

Six months ending
June 30, 2018

28,000

7.0

800

6.2

800

15.6

400

151.0

8.39

Year ending
December 31, 2018

61,500

7.4

5,000

17.1

5,050

14.8

3,000

36.2

62.89

*Notes(1) Changes affecting the consolidation status of significant subsidiaries during the period: None
(2) Changes in accounting policy, changes in accounting estimates, and retrospective restatement
1) Changes in accordance with amendments to accounting standards, etc.: None
2) Changes other than noted in 1) above: None
3) Changes in accounting estimates: None
4) Retrospective restatement: None(3) Shares issued (common stock)1) Number of shares issued at end of period(including treasury stock)2) Number of shares held in treasury at end of period

3) Average number of shares outstanding during the period

December 31, 2017

December 31, 2016

48,960,000

48,960,000

1,259,834

1,259,834

Year ended

Year ended

December 31, 2017

December 31, 2016

47,700,166

48,347,959* This Earnings Report is exempt from the review requirements.
*Appropriate Use of Earnings Forecast and Other Important Information(Cautionary Statement with Respect to Forward-Looking Statements)
Any forecasts and forward-looking statements given herein are based on information available as of thisreport’s publication and on certain assumptions that are deemed reasonable. These forecasts are notguarantees of future performance, and actual results may differ from forecasts due to changes in thebusiness environment. For the assumptions underlying the forecasts herein and other notice on the use of
earnings forecasts, please refer to “(4) Earnings Forecast for Fiscal Year Ending December 31, 2018” inthe section “1. Review of Consolidated Financial Results” on page 4 in the accompanying materials.
(Presentation handout materials)
The Company has scheduled an earnings presentation targeted at institutional investors and analysts on
February 19, 2018.
The presentation handout materials will be posted on the Company's website immediately after the event.

Accompanying Material – Contents
1. Review of Consolidated Financial Results(1) Operating Results for Fiscal 2017(2) Overview of Financial Condition(3) Overview of Cash Flows(4) Earnings Forecast for Fiscal Year Ending December 31, 2018
2. Basic Views on Adoption of Accounting Standards
3. Consolidated Financial Statements and Main Notes(1) Consolidated Balance Sheets(2) Consolidated Statements of Income and Comprehensive Income
Consolidated Statements of Income
Consolidated Statements of Comprehensive Income(3) Consolidated Statements of Changes in Net Assets(4) Consolidated Statements of Cash flows(5) Notes to the Financial Statements(Note on the Going-concern Assumption)(Additional Information)(Segment Information)(Per Share Information)(Significant Subsequent Events)
4. Other Information(1) Changes in Officers(2) Weddings Held and Orders Received

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2
3
3
4
5
6
6
8
8
9
10
12
14
14
14
15
18
18
19
19
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1. Review of Consolidated Financial Results(1) Operating Results for Fiscal 2017
In the fiscal year ended December 31, 2017, the Japanese economy followed a modest
recovery path thanks to the improvement in personal spending, corporate earnings andemployment conditions due to the favorable impact of the government’s various economic
policies. That said, the future outlook remained unclear owing to such factors as uncertainties
over the direction of overseas economies.
In the bridal market, the core business of the Tsukada Global Holdings Group (“theCompany”), the number of weddings in Japan in 2017 was estimated at 607,000, comparedwith 621,000, down 2.2% from 2016 (source: Outline of Vital Statistics in Japan, Ministry of
Health, Labour and Welfare). Although the declining birthrate is gradually having a
discernible impact, Japan’s wedding market environment remains generally stable, due partly
to a steady rise in wedding expenditures per wedding. Moreover, the number of foreign
visitors to Japan is estimated to have reached a record 28.69 million in 2017 (up 19.3% yearon-year from the 24.03 million in 2016 according to the Japan National Tourism
Organization), and the hotel market is continuing to expand steadily owing to the recovery in
the Japanese economy, along with the boost from foreign visitors.
Furthermore, the relaxation-related market is expected to experience substantial
development and expansion in the coming years as the burgeoning interest in health andbeauty of recent years adds to the market’s previous underlying strength.
In this market environment, the Group endeavored to increase sales and profitability byaccurately responding to customers’ increasingly individualized and diversifying needs in thebridal, hotel, and wellness and relaxation (W&R) markets while working to create new value,develop high-quality, appealing outlets, and provide high value-added services.
Based on this policy, the Company has taken steps this term to expand its earnings andgeographical operating areas with its first foray in Okinawa Prefecture in March 2017, theopening of its comprehensive fitness club “Best Style Fitness” (Urayasu, Chiba Prefecture)in September, 2017 and new outlet “The Strings Omotesando” (Minato Ward, Tokyo) in
October as well as preparations for the opening of the “The Strings Hotel Shinjuku(provisional name)” and “ArtGrace Next (Ashiya, Hyogo Prefecture)” and so forth.
As a result of these efforts, in the fiscal year ended December 31, 2017, the Company
posted consolidated net sales of ¥57,253 million (up 3.4% year on year). Regarding income,
operating income totaled ¥4,268 million (up 21.4%), ordinary income of ¥4,398 million (up22.2%), and profit attributable to owners of the parent of ¥2,203 million (up 12.9%)
a. Wedding businessIn fiscal 2017, although the number of weddings held at its guesthouses in Japan, a corebusiness, edged down, wedding business sales rose slightly year on year underpinned bya sharp increase in the number of weddings held overseas. However, income in thesegment decreased mainly from the initial cost of the opening of “The Strings Omotesando”
which offset the impact of cost-cutting measures implemented from the previous year.
As a result, net sales in the wedding business were ¥35,339 million (up 1.6% year onyear), and segment operating income was ¥5,060 million (down 3.8%).
b. Hotel businessIn fiscal 2017, sales of the hotel business rose thanks to a slight increase in the number of
weddings held at its hotels along with generally steady increases in the overnightaccommodation occupancy rate and average customer spend. Income in the segment2

increased in the absence of outlet-opening expenses and due to the effect of its cost
reductions as was the case in the wedding business.
As a result, net sales in the hotel business reached ¥18,290 million (up 4.1% year onyear), while segment operating income totaled ¥1,296 million (up 70.0%).
c. W&R business (Wellness & Relaxation business)
In fiscal 2017, In the W&R business, although sales rose thanks to the full-term operationof the spa complex-Beauty & Relax SPA-HERBS, the Company posted a loss owing toinitial costs of “Best Style Fitness,” the comprehensive fitness club that opened in
September and so on.
As a result, net sales in the W&R business were ¥3,623 million (up 20.2% year on year),and segment operating loss was ¥406 million (versus a loss of ¥473 million a year earlier).
(2) Overview of Financial Condition(Assets)
Total assets at the end of the fiscal year (December 31, 2017) amounted to ¥84,447 million,a decrease of ¥305 million from the end of the previous fiscal year (December 31, 2016). Thechange largely reflects a ¥483 million decline in cash and deposits primarily due to the early
redemption of convertible bonds with stock acquisition rights and a ¥383 million decrease
from sales of investment securities. These decreases offset an ¥834 million increase intangible assets largely from the construction of “The Strings Omotesando” and a ¥233 million
increase of deferred tax assets (investment).
(Liabilities)
Liabilities at the end of the fiscal year came to ¥48,666 million, a decrease of ¥1,858 million
from the end of the previous fiscal year. The decline is chiefly attributable to a decrease of¥4,500 million in convertible bonds with stock acquisition rights (including the current portion)
due to early redemption and a ¥6,328 million reduction of long-term debt (including thecurrent portion) owing to scheduled payments which outweighed a ¥8,100 million increase in
short-term debt to raise working capital.
(Net assets)
Net assets at the end of the fiscal year totaled ¥35,781 million, an increase of ¥1,552 million
from the end of the previous fiscal year. The change is primarily due to ¥2,203 million in profit
attributable to owners of the parent which offset a decrease of ¥477 million in dividends paid.
(3) Overview of Cash Flows
Cash and cash equivalents (“cash”) at the end of the fiscal year decreased by ¥483 million
from the end of the previous fiscal year to ¥14,896 million. Cash flows and factors behindchanges in the cash flows are explained below.
(Operating cash flow)
Cash provided by operating activities during the fiscal year totaled ¥7,062 million, an increaseof 7.7% from the previous fiscal year. The change is mainly attributable to ¥3,929 million inincome before income taxes and ¥3,344 million in depreciation and amortization, partially
offset by ¥1,734 million in income taxes paid.
(Investing cash flow)
Cash used in investing activities totaled ¥3,976 million, a decrease of 67.8% from theprevious fiscal year. The change is mainly the result of ¥4,226 million for purchase of tangible
assets.
(Financing cash flow)
Cash used in financing activities in the fiscal year totaled ¥3,573 million, compared with acash acquisition of 3,131 million the previous fiscal year. The change is mainly attributable3

to repayments of long-term debt of ¥13,329 million and the redemption of convertible bonds
with stock acquisition rights of ¥4,500 million, partially offset by a net increase of short-term
debt of ¥8,100 million and proceeds of ¥7,001 million from long-term debt.
Changes in the Tsukada Global Holdings Group’s cash flow-related indicators are as
follows.
FY2013

FY2014FY2015FY2016FY2017Return on equity (%)

45.7

42.7

39.6

38.5

40.5

Return on equity basedon market value (%)

60.2

60.1

47.7

39.3

37.5

Cash flow to interestbearing debt (years)

3.2

3.9

6.2

5.8

5.0

Interest coverage ratio(times)

23.4

32.6

24.8

27.2

33.9

Notes:
Return on equity: Total equity/Total assets
Return on equity based on market value: Market valuation/Total assets
Cash flow to interest-bearing debt: Interest-bearing debt/Operating cash flow
Interest coverage ratio: Operating cash flow/Interest expenses
1. All indicators are calculated based on consolidated figures.
2. Cash flows from operating activities in the Consolidated Statements of Cash Flows
are used for operating cash flow. Interest-bearing debt includes all liabilities recorded on
the Consolidated Balance Sheets on which interest is paid. Interest paid in theConsolidated Statements of Cash Flows is used for Interest expenses.
(4) Earnings Forecast for Fiscal Year Ending December 31, 2018
Regarding the economic environment in which the Tsukada Global Holdings Group operates,
the economy continued on a recovery track reflected by an upturn in consumer spending aswell as an improvement in corporate earnings and employment conditions thanks partly tothe impact of various government economic stimulus measures, However, the economic
outlook is likely to remain unclear primarily due to uncertainties over the direction of overseas
economies.
The Group intends to actively develop products which accurately meet customer needs
and constantly strive to create new value. It will also aim to improve its cost-competitivenessand enhance profitability through efficient outlet development and the development of humanresources.
The wedding order backlog at the end of the fiscal year under review (December 31, 2017)
was 8,065 (up 8.5% year on year). For the fiscal year ending December 31, 2018, theCompany forecasts consolidated net sales of ¥61,500 million (up 7.4%), operating income of¥5,000 million (up 17.1%), ordinary income of ¥5,050 million (up 14.8%), and profit
attributable to owners of the parent of ¥3,000 million (up 36.2%).

4

2. Basic Views on Adoption of Accounting Standards
The Company’s financial statements are prepared in accordance with the accounting
principles generally accepted in Japan (Japanese GAAP), in order to ensure comparability
with other companies in the peer. As to the possible future adoption of the International
Financial Reporting Standards (IFRS), the Company shall continue its study going forward,
taking into account the future developments of the Company’s business and of the global
and Japanese business environments.

5

3. Consolidated Financial Statements and Main Notes(1) Consolidated Balance Sheets
December 31, 2016
AmountAssetsCurrent assets
Cash and deposits
Accounts receivable - trade
Merchandise
Raw materials and supplies
Deferred tax assets
Other
Allowance for doubtful receivables
Total current assets
Fixed assets
Tangible assets
Buildings and structures
Accumulated depreciation
Buildings and structures, net
LandConstruction in progress
Other
Accumulated depreciation
Other, net
Total tangible assets
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Lease and guarantee deposits
Deferred tax assets
Other
Allowance for doubtful receivables
Total investments and other assets
Total fixed assets
Deferred assets
Bond issuance costs
Total deferred assets
Total assets

6(millions of yen)
December 31, 2017
Amount15,468
966
114
506
459
1,549
(64)
19,00014,985
1,108
118
557
416
1,256
(38)
18,404

43,102(19,505)
23,597
21,156781
6,839(5,036)
1,803
47,33846,083(21,338)
24,74520,881647
7,918(6,019)1,898
48,173

2,271
272
2,543

2,004
231
2,236

3,058
8,649
3,110
952
15,77165,653

2,675
8,663
3,343
1,048
(180)
15,55065,96098
98
84,75282
82
84,447

December 31, 2016
AmountLiabilities
Current liabilities
Accounts payable - trade
Short-term debt
Current portion of long-term debt
Current portion of bonds
Current portion of convertible bonds with stockacquisition rights
Income taxes payable
Advances received
Other
Total current liabilities(millions of yen)
December 31, 2017
Amount2,362
13,062
824

2,461
8,100
3,633
744

-

500

1,112
1,336
3,366
22,065

1,234
1,625
4,009
22,3073,684
5,000
15,747
332
702
2,339
652
28,45950,524

3,415
18,848
353
738
2,369
632
26,35848,666

Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity

472
634
32,090(892)
32,304472
634
33,816(892)
34,030

Accumulated other comprehensive income
Net unrealized gain on available-for-sale securities
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-Controlling Interests
Total net assets
Total liabilities and net assets

(58)
376
(3)
313
1,610
34,22884,752

(66)
250
(5)
178
1,572
35,781
84,447

Fixed liabilities
Bonds
Convertible bonds with stock acquisition rights
Long-term debt
Net defined benefit liability
Provision for directors’ retirement benefits
Asset retirement obligations
Other
Total fixed liabilities
Total liabilities7(2) Consolidated Statements of Income and Comprehensive Income
Consolidated Statements of Income(millions of yen)
Year ended
Year ended
December 31, 2016 December 31, 2017
AmountAmount55,36557,253
Net sales
Cost of sales
38,12538,713
17,24018,540Gross profit
13,724
14,272
Selling, general and administrative expenses
3,515
4,268
Operating income
Non-operating income
Interest income
46
36
Dividend income
29
32
Gain on investments in silent partnership
158
166
Gain on redemption of investment securities
122
Real estate rental income
152
253
Foreign exchange gains
93
Other
102
92
Total non-operating income
611
675
Non-operating expenses
Interest expenses
240
212
Loss on valuation of derivatives
58
178
Real estate rental expenses
40
101
Foreign exchange loss
143
Other
45
51
Total non-operating expenses
527
544
3,598
4,398
Ordinary income
Extraordinary income
Gain on sales of fixed assets
10Gain on sales of investment securities
1
Reversal gains of provisions for directors’ retirement benefits
14
Reversal gains of provisions for shop closing expenses
4
Total extraordinary income
20
1
Extraordinary loss
Impairment loss
37
192
Provision of allowance for doubtful receivables
180
Others195
98
Total extraordinary loss
232
471
3,386
3,929
Profit before income taxes
1,585
1,873
Income taxes - current
(146)
(174)
Income taxes - deferred
1,439
1,699
Total income taxes
1,946
2,229
Profit for the period(5)26Profit (loss) attributable to non-controlling interests
1,951
2,203
Profit (loss) attributable to owners of the parent

8

Consolidated Statements of Comprehensive Income

Profit for the period
Other comprehensive income
Net unrealized gain on available-for-sale securities
Foreign currency translation adjustments
Remeasurements of defined benefit plan
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to owners of theparentComprehensive income attributable to non-controllinginterests

9

Year ended
December 31, 2016
Amount1,946(millions of yen)
Year ended
December 31, 2017
Amount
2,229

(30)
278
(0)
247
2,194

(8)
(174)
(1)
(183)
2,046

2,106

2,067

87

(21)

(3) Consolidated Statements of Changes in Net Assets
Year ended December 31, 2016 (January 1 to December 31, 2016)(millions of yen)
Shareholders’ equity

Balance at beginning of term

Capital stock

Capital surplus

472

634

Retainedearnings

Treasury stock

30,630Changes during term
Cash dividends
Profit attributable to owners of
the parent
Purchase of treasury stock

(88)

Total
shareholders’equity31,648

(486)

(486)

1,951

1,951
(804)

Change in scope of

(804)

(5)

consolidation(5)

Net changes in items otherthan shareholder's equity
Total changes during term

-

-

1,460

(804)

655

Balance at end of term

472

634

32,090(892)

32,304

Accumulated other comprehensive income

Balance at beginning ofterm

Net unrealized
gain onavailable-for-salesecurities

Foreign currencytranslation
adjustments

Remeasurementsof defined
benefit plans

Total
accumulated
othercomprehensive
income

(28)

190

(2)

158

Non-controllinginterests-

Total net
assets31,807

Changes during term
(486)

Cash dividends
Profit attributable toowners of the parent
Purchase of treasury

1,951
(804)

stock
Change in scope of(5)

consolidation
Net changes in items
other than

(30)

185

(0)

154

1,610

1,765

Total changes during term

(30)

185

(0)

154

1,610

2,420

Balance at end of term

(58)

376

(3)

313

1,610

34,228shareholder's equity

10

Year ended December 31, 2017 (January 1 to December 31, 2017)(millions of yen)
Shareholders’ equity

Balance at beginning of term

Capital stock

Capital surplus

472

634

Retainedearnings

Treasury stock

32,090Changes during term
Cash dividends
Profit attributable to owners of
the parent
Purchase of treasury stock

(892)

Total
shareholders’equity32,304

(477)

(477)

2,203

2,203
-

Change in scope of-

consolidation
Net changes in items otherthan shareholder's equity
Total changes during term

-

-

1,726

-

1,726

Balance at end of term

472

634

33,816(892)

34,030

Accumulated other comprehensive income

Balance at beginning ofterm

Net unrealized
gain onavailable-for-salesecurities

Foreign currencytranslation
adjustments

Remeasurementsof defined
benefit plans

Total
accumulated
othercomprehensive
income

(58)

376

(3)

313

Non-controllinginterests

1,610

Total net
assets34,228Changes during term
(477)

Cash dividends
Profit attributable toowners of the parent
Purchase of treasury

2,203
-

stock
Change in scope of-

consolidation
Net changes in items
other than

(8)

(125)

(1)

(135)

(38)

(173)

Total changes during term

(8)

(125)

(1)

(135)

(38)

1,552

Balance at end of term

(66)

250

(5)

178

1,572

35,781shareholder's equity11(4) Consolidated Statements of Cash flows(millions of yen)
Year ended
Year ended
December 31, 2016 December 31, 2017
AmountCash flows from operating activities
Profit before income taxes
Depreciation and amortization
Amortization of goodwill
Amortization of bond issuance costs
Loss on disposal of tangible assets(Gain) loss on sales of fixed assets(Gain) loss on valuation of derivatives(Gain) loss on redemption of investment securities(Gain) loss on sales of investment securities(Gain) loss on investments in silent partnership
Foreign exchange (gain) loss
Impairment loss

Amount

3,386
3,349
266
21
60
(1)
58
(122)
130
(158)
136
37

3,929
3,344
266
27
13
(0)
178
8
(166)
(95)
192

Increase (decrease) in allowance for doubtful receivables

9

154

Increase (decrease) in net defined benefit liability
Increase (decrease) in provision for directors’ retirement
benefits
Loss on valuation of affiliated companies’ shares
Shop closing expenses
Interest and dividend income
Interest expenses(Increase) decrease in notes and accounts receivable trade(Increase) decrease in inventories
Increase (decrease) in notes and accounts payable - trade(Increase) decrease in other assets
Increase (decrease) in advances received
Increase (decrease) in accrued consumption taxes
Increase (decrease) in other liabilities
Other- net
Sub totalInterest and dividends received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities

(0)

20

11

36

3
(75)
240

24
15
(68)
212

(96)

(143)

(18)
107
40
206
592
176
255
8,618
67
(240)
(1,885)
6,559

(54)
99
(91)
289
(144)
295
619
8,964
41
(208)
(1,734)
7,062

12

(millions of yen)
Year ended
Year ended
December 31, 2016 December 31, 2017
AmountCash flows from investing activities
Purchase of tangible assets
Purchase of intangible assets
Purchase of investment securities
Proceeds from sales of investment securities
Proceeds from redemption of investment securities
Repayment of contributions from the silent partnership
Loans receivableCollection of loans receivable
Lease and guarantee deposits
Collection of lease and guarantee deposits
Payments of construction assistance fund receivables
Other- net
Net cash provided by (used in) investing activities
Cash flows from financing activities
Net increase (decrease) in short-term debt
Proceeds from long-term debt
Repayments of long-term debt
Proceeds from issuance of bonds
Payments for redemption of bonds
Payments for redemption of convertible bonds
Purchase of treasury stock
Proceeds from stock issuance to non-controlling interests
Dividends paid to non-controlling interests
Purchase of subsidiaries’ shares without change in thescope of consolidation
Dividends paid to shareholders
Other – net
Net cash provided by (used in) financing activities
Foreign currency translation adjustments on cash andcash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents, beginning of period
Increase in cash and cash equivalents fromnewly consolidated subsidiary
Cash and cash equivalents, end of period

13

Amount(12,619)
(169)
(300)
793
436
430
(159)
52
(635)
271
(50)
(402)
(12,352)(4,226)
(56)
(257)
227
540
(42)
42
(144)
9
(50)
(17)
(3,976)

5,733(2,982)
977
(774)
(807)
1,505
-

8,100
7,001
(13,329)488(849)(4,500)
(16)

(24)

-

(486)
(9)
3,131

(476)
9
(3,573)(71)

3(2,733)
17,863(483)
15,380249-

15,38014,896

(5) Notes to the Financial Statements(Note on the Going-concern Assumption)
Not applicable(Additional Information)(Application of the Implementation Guidance on Recoverability of Deferred Tax Assets)
The Company has applied the “Implementation Guidance on Recoverability of Deferred Tax Assets” (ASB
Guidance No 26, March 28, 2016), effective from the fiscal year ended December 31, 2017.

14

(Segment Information)
1. Overview of reportable segment
The Company Group’s reportable segments are components of the Group about which separate financial
information is available. These segments are subject to periodic examinations to enable the Company’sboard of directors to decide how to allocate resources and assess performance.
The Group’s operations are classified into three reportable segments: the “Wedding business” thatprovides services such as planning and operation related to wedding ceremonies and banquets in Japanand overseas, the “Hotel business” that offers the management of hotel weddings and provision of hotel
accommodation services, and the “W&R business” segment that provides reflexology services andmanagement of a spa complex and a comprehensive fitness club.
“Wedding business” comprises outlet management in Japan and sales to customers, provision of foodand drinks at wedding banquets, dress rental and beauty care services, as well as management of venues
and operations for weddings and banquet in Hawaii and Bali Indonesia, mainly for customers who bookthrough the Group’s sales salons in Japan. The segment also subleases wedding facilities to an affiliate inSouth Korea. “Hotel business” offers the management of hotel weddings and provision of hotel
accommodation services at Hotel InterContinental Tokyo Bay, The Strings by InterContinental Tokyo, Sir
Winston Hotel, and The Strings Hotel Nagoya. “W&R business” operates a British-style reflexology salon,“Queensway” with a high level of skills and sophisticated know-how of attending to customers, as well as
managing a spa complex, “Beauty &Relax SPA-HERBS,” and a comprehensive fitness club, “BESTSTYLE FITNESS.”
2. Calculation of net sales, income/loss, assets, liabilities, and other items by reportable segment
Accounting methods applied in the reportable business segments are in accordance with theaccounting policies that are adopted for the preparation of consolidated financial statements.
Reportable segment income is based on operating income.
Intersegment sales or transfers are based on market price.

15

3. Net sales, income/loss, assets, liabilities, and other items by reportable segment
Year ended December 31, 2016 (January 1 to December 31, 2016)(millions of yen)

Reportable segment
Amountrecorded on

WeddingbusinessHotelbusiness

W&R
business

Total

Adjustments

consolidated(note 1)

financialstatements(note 2)

Net sales
Sales to outside
customers
Inter-segment sales
and transfers
Total

34,783

17,5683,013

55,365-55,365

1,254

431

0

1,686

(1,686)-36,03817,9993,014

57,052(1,686)55,365

Segment income (loss)

5,259

762

(473)

5,548

(2,033)

3,515

Segment assets

32,774

24,816

5,993

63,584

21,16884,752

1,734
-

1,290
128

278
138

3,303
266

45
-

3,349
266

2,360

1,489

2,539

6,389

5,440

11,830

Other items
Depreciation/amortization
Amortization of goodwill
Increase(decrease) intangible and intangible
assets
Notes: 1. Details of adjustments are as follows:(1) The minus 2,033 million yen adjustment for segment income or loss includes 5 million yen elimination of inter-segment
sales and minus 2,038 million yen of unallocated corporate expenses. The main component of these unallocated corporate
expenses is SG&A expenses that are not attributable to reportable segments.
(2) The 21,168 million yen adjustment for segment assets comprises unallocated corporate assets. Unallocated corporate
assets consist mainly of cash and deposits held by the Company which are not attributable to reportable segments.
(3) The 45 million yen adjustment for depreciation/amortization comprises depreciation/amortization for unallocatedcorporate assets.
(4) The 5,440 million yen adjustment for increase in tangible and intangible assets comprises investments in unallocatedcorporate assets.
2. Segment income or segment loss is adjusted to correspond with operating income reported on the consolidated
statements of income.

16

Year ended December 31, 2017 (January 1 to December 31, 2017)(millions of yen)

Reportable segment
Amountrecorded on

WeddingbusinessHotelbusiness

W&R
business

Total

Adjustments

consolidated(note 1)

financialstatements(note 2)

Net sales
Sales to outside
customers
Inter-segment sales
and transfers

35,33918,2903,623

57,253-57,253

1,407

373

1

1,782

(1,782)-

Total

36,747

18,663

3,625

59,036(1,782)57,253

Segment income (loss)

5,060

1,296

(406)

5,950

(1,682)

4,268

Segment assets

33,80923,452

6,095

63,35721,08984,447

1,721
-

1,213
128

332
138

3,267
266

77
-

3,344
266

3,396

678

556

4,631

103

4,735

Other items
Depreciation/amortization
Amortization of goodwill
Increase(decrease) intangible and intangible
assets
Notes: 1. Details of adjustments are as follows:(1) The minus 1,682 million yen adjustment for segment income or loss includes 37 million yen elimination of intersegment sales and minus 1,719 million yen of unallocated corporate expenses. The main component of these
unallocated corporate expenses is SG&A expenses that are not attributable to reportable segments.
(2) The 21,089 million yen adjustment for segment assets comprises unallocated corporate assets. Unallocatedcorporate assets consist mainly of cash and deposits held by the Company which are not attributable to reportablesegments.
(3) The 77 million yen adjustment for depreciation/amortization comprises depreciation/amortization for unallocatedcorporate assets.
(4) The 103 million yen adjustment for increase in tangible and intangible assets comprises investments in unallocatedcorporate assets.
2. Segment income or segment loss is adjusted to correspond with operating income reported on the consolidated
statements of income.

17(Per Share Information)

Net assets per share
Profit for the period per share
Diluted profit per share
Note:

Year ended December 31, 2016
683.81 yen
40.37 yen
36.00 yen

Year ended December 31, 2017717.16 yen
46.19 yen42.31 yen

The calculation base for profit for the period per share and for diluted profit per share is as follows:Year ended
December 31, 2016

Year ended
December 31, 2017

1,951

2,203

-

-

1,951

2,203

48,347,959

47,700,166--

5,868,544

4,363,623[5,868,544][4,363,623]--

Profit for the period per share
Profit attributable to owners of the parent(millions of yen)Amount not attributable to common
stockholders (millions of yen)
Profit attributable to common stocks ofowners of the parent (millions of yen)
Average number of shares outstanding
during the term (shares)
Diluted profit per share
Adjustment to profit attributable to owners of
the parent (millions of yen)
Increase in the number of common stock(shares)[Of which convertible bond with stockacquisition rights (shares)]
Residual securities that are not dilutive and notincluded in the calculation for diluted profit per
share(Significant Subsequent Events)
Not applicable184. Other Information(1) Changes in Officers
Not applicable(2) Weddings Held and Orders Received
1) Number of weddings held
Year ended December 31, 2016

Year ended December 31, 2017

Number of weddings held (cases)
11,401

Number of weddings held (cases)
11,800Hotel business

1,799

1,845

Total

13,20013,645

Year ended December 31, 2016

Year ended December 31, 2017

Segment
Wedding business2) Wedding orders received

Segment

Orders received

Order backlog

Orders received

Order backlog

Wedding business(cases)
11,563(cases)6,178(cases)
12,571(cases)6,949

Hotel business

1,814

1,257

1,704

1,116

Total

13,377

7,435

14,2758,065

19