Three-month Consolidated Financial Report for the Fiscal Year ending
October 31, 2018 [Japan GAAP]
March 9, 2018
Listed Company Name
Company Code Number

Kanamoto Co., Ltd.
9678

Listing Exchanges

Tokyo Stock Exchange, Sapporo Stock Exchange

URL
Representative

http://www.kanamoto.co.jp
Tetsuo Kanamoto
President and CEOInquiries

Nobuhito Utatsu

Director & Senior Executive Corporate Officer, Division
Manager, Accounting Division

TEL 81-11-209-1600
Please send inquiries in English to takayama@kanamoto.co.jp
Scheduled date for submission of Quarterly Report

March 15, 2018

Scheduled date for commencement of dividend payments–Preparation of Quarterly Settlement Supplementary Explanatory Materials

NoQuarterly Earnings Briefings

No(Numbers less than one million yen have been rounded down)

1. Consolidated Operating Results for the Three-Month Period of the Fiscal Year Ending October 31, 2018
(November 1, 2017 – January 31, 2018)(1) Consolidated Operating Results (Cumulative)(Percentages show the change from the prior year)
Profit Attributable toNet Sales
Operating Income
Ordinary Income
Owners of Parent
Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

5,370

19.6

5,543

14.33,422

9.4

4,490

10.3

4,848

19.3

3,128

23.5

Fiscal Year ending October 31,
42,264
8.5
2018: First quarter
Fiscal Year ended October 31,
38,93711.0
2017: First quarter(Note) Comprehensive income (millions of yen)
Fiscal Year Ending October 31, 2018, First Quarter
Fiscal Year Ended October 31, 2017, First Quarter
Net Income per
Share
Fiscal Year ending October 31,
2018: First quarter
Fiscal Year ended October 31,
2017: First quarter

3,697
3,662

(1.0%)(60.2%)Net Income per
Share on a Fully
Diluted BasisYen

Yen

96.84－

88.52－(2) Consolidated Financial Position
Total Assets

Net Assets

Millions of yen

Fiscal Year ending October 31,
235,9122018: First quarter
Fiscal Year ended October 31,
227,545
2017(Reference) Equity (millions of yen)
Fiscal Year Ending October 31, 2018 First Quarter
Fiscal Year Ended October 31, 2017－%

94,22737.5

91,78837.9

88,40886,241

1 －Equity Ratio

Millions of yen

2. Dividends
Annual Dividends per Share
End of second End of third
Year-endquarter
quarter

End of firstquarter
Fiscal year ended October 31, 2017
Fiscal year ending October 31, 2018
Fiscal Year ending October 31, 2018
(Projected)

Full-year

YenYenYen

YenYen－－

15.00

－

35.00

50.00

35.00

55.00

20.00

(Note) 1. Has the Company revised its most recently released dividend projection?

No

3. Projected Consolidated Operating Results for the Fiscal Year Ending October 2018
(November 1, 2017 – October 31, 2018)(Percentages show the change from the prior year)

Net SalesInterim (cumulative)
Full year

Operating Income

Ordinary Income

Millions of yen%

Millions of yen%

Millions of yen%

81,400161,870

2.8
2.2

9,240
17,330

−7.5
4.0

9,270
17,420−9.51.3

Profit Attributable toOwners of Parent
Millions of yen

Net Income perShare%

Yen

5,770 −10.8
10,9001.4

163.28308.44(Note) Has the Company revised its most recently released projected consolidated operating results during the quarter:
No－2 －4. Notes(1) Changes in material subsidiaries during the period under review (Changes in specific subsidiaries in conjunction witha change in the scope of consolidation): No
Company newly included (Company name)─Company newly excluded (Company name)─(2) Application of special accounting method in the preparation of quarterly consolidated financial statements:

No(3) Changes in accounting principles, changes in accounting estimates and retrospective restatements(a) Changes in accounting policy in conjunction with revision of accounting standards:
No(b) Changes other than the above:No(c) Changes in accounting estimates:(d) Retrospective restatements:

NoNo(4) Number of shares issued (common shares)(a) Number of shares outstanding at the end of the period (including treasury shares)
Fiscal year ending October 31, 2018 First Quarter
36,092,241 sharesFiscal year ended October 31, 201736,092,241 shares(b) Number of shares of treasury stock at the end of the period
Fiscal year ending October 31, 2018 First Quarter
753,183 sharesFiscal year ended October 31, 2017753,253 shares(c) Average number of shares during the period (consolidated year-to-date)Fiscal year ending October 31, 2018 First Quarter
35,339,036 sharesFiscal year ended October 31, 2017 First Quarter
35,339,129 shares

Note: This quarterly earnings report is exempt from the quarterly review procedure
Note: Explanation concerning appropriate use of the projected operating results and other items to note
Note Concerning Forward-Looking Statements
The above projections were prepared based upon information available to the Company at the time the projections
were announced as well as various assumptions concerning the future economic and business environment. Actual
operating results may differ from the projected figures depending upon various factors in the future. Please refer to“1. Qualitative Information Concerning Quarterly Consolidated Operating Results (3) Explanation Concerning Future
Forecasts Including Projected Consolidated Operating Results” on Page 7 of the Attachments for the conditions
used as assumptions for the projected operating results and matters to note before using the projected operatingresults.

－3 －〇Attachments Table of Contents
1. Qualitative Information Concerning Quarterly Consolidated Operating Results ……………………………………

5(1) Qualitative Information Concerning Consolidated Operating Results ……………………………………………

5(2) Qualitative Information Concerning Consolidated Financial Position ……………………………………………

5(3) Explanation Concerning Future Forecasts Including Projected Consolidated Operating Results …………….

6

2. Quarterly Consolidated Financial Statements and Significant Notes Thereto ……………………………………….

7(1) Quarterly Consolidated Balance Sheets …………………………………………………………………………….
(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive
Income ………………………………………………………………………………………………………………….
Quarterly Consolidated Statements of Income

7

Consolidated Three-month Period ended January 31, 2018 ……………………………………………….

99

Quarterly Consolidated Statements of Comprehensive Income
Consolidated Three-month Period ended January 31, 2018 ……………………………………………….

10(3) Notes Concerning Quarterly Consolidated Financial Statements ………………………………………………...

11(Notes Relating to the Going Concern Assumption) ………………………………………………………………

11(Note on Significant Changes to Shareholders’ Equity) ………………………………………………………….

11(Business Segment Information) ……………………………………………………………………………………

11－4 －1. Qualitative Information Concerning Quarterly Consolidated Operating Results(1) Qualitative Information Concerning Consolidated Operating Results
During the consolidated three-month period ended January 31, 2018, Japan’s economy remained underconditions that demanded close attention because of uncertainties surrounding the overseas economy andheightened geopolitical risks, but maintained its gradual recovery trend against the backdrop of various policies
undertaken by the government.
In the construction industry related to the Kanamoto Group, construction demand remained brisk, supported bysteady public works investment as well as by increased capital investment by private sector firms that wasspurred by improved corporate earnings.
Given these conditions, net sales of the Kanamoto Group for the consolidated three-month Period increased
8.5% compared with the same period one year earlier to ¥42,264 million. In terms of earnings, operating income
increased 19.6% from the same period of the prior consolidated fiscal year to ¥5,370 million, ordinary income
increased 14.3% year-on-year to ¥5,543 million, and first quarter profit attributable to owners of parent rose 9.4%
year-on-year to ¥3,422 million.
Results for each of the Company’s business segments were as follows.
< Business related to the Construction Equipment Rental Division >In the construction-related business that is Kanamoto’s primary business focus, the Company moved toprecisely reposition assets to meet construction equipment rental demand in each region as recovery andrestoration demand in the Tohoku Region gradually tapers off, while also strengthening its organization for
ongoing support of disaster recovery and reconstruction activities.
Used construction equipment sales, which the Company undertakes to maintain an appropriate asset portfolio,
were steady as the market’s conditions remained robust.
As a result of the above factors, first quarter net sales for Kanamoto’s construction-related businesses
increased 6.4% from the same period of the prior consolidated fiscal year to ¥37,815 million, and operating
income rose 23.4% year-on-year to ¥5,021 million.
< Other businesses >In the Company’s other businesses, net sales were up 30.9% from the same period of the prior consolidated
fiscal year to ¥4,449 million as steel products-related sales, sales in the information and telecommunicationsrelated division, and sales in the Company’s welfare-related business grew at a steady pace. Operating income
fell by 21.0% year-on-year to ¥250 million, however, as sales of steel-related works declined.
< Change in number of branches >The Company opened one new branch during the first quarter consolidated accounting period. The Company
did not close any branches.
Newly established: East Japan Works Keihin Facility Parts Center (Kawasaki City, Kanagawa Prefecture)(2) Qualitative Information Concerning Consolidated Financial Position
Assets, liabilities and net assets
Total assets at the end of the first quarter under review increased by ¥8,367 million compared with the end of
the prior consolidated fiscal year to ¥235,912 million. This mainly reflected an increase in rental equipment of¥2,700 million and an increase in cash and deposits of ¥1,255 million.
Total liabilities were ¥141,685 million, an increase of ¥5,929 million compared with the end of the priorconsolidated fiscal year. The principal items contributing to this change were an increase of ¥2,323 million in
short-term loans payable, an increase of ¥1,830 million in long-term loans payable, an increase of ¥1,765 million
in notes and accounts payable-trade, and an increase of ¥1,459 million in long-term accounts payable-other,respectively, and a decrease of ¥1,637 million in income taxes payable.
Total net assets were ¥94,227 million, ¥2,438 million higher than at the end of the prior consolidated fiscal year.
This was mainly because of profit attributable to owners of parent for the first quarter of ¥3,422 million, and adecrease of ¥1,236 million for dividends from surplus.
－5 －(3) Explanation Concerning Future Forecasts Including Projected Consolidated Operating Results
There are no revisions to the full-year projected operating results that the Company announced in the Financial
Statements Bulletin for the Fiscal Year Ended October 31, 2017 (Japan GAAP) released on December 8, 2017.

－6 －2. Quarterly Consolidated Financial Statements and Significant Notes Thereto(1) Quarterly Consolidated Balance Sheets(Unit: Millions of yen)
As of October 31, 2017

As of January 31, 201835,22037,057
4,069
200
583
288
12,193
706
1,237
−784
90,77236,47537,670
4,546
200
905
639
12,792
392
1,333
−793
94,163

198,879−125,211
73,66832,910−19,801
13,108
7,290−6,154
1,136
35,6232,170−1,421
749
124,286

202,575−126,206
76,36833,264−20,036
13,228
7,346−6,2091,136
36,5792,552−1,446
1,105
128,419

486
1,110
1,596

450
1,146
1,596

8,417
436
2,308
−272
10,889136,772
227,545

9,313
433
2,277
−290
11,733
141,749
235,912

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Electronically recorded monetary claims – operating
Securities
Merchandise and finished goods
Raw materials and suppliesConstruction machine parts
Deferred tax assets
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Rental equipment
Accumulated depreciation
Rental equipment, net
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Machinery, equipment and vehicles
Accumulated depreciation
Machinery, equipment and vehicles, netLand
Other
Accumulated depreciation
Other, net
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets－7 －(Unit: Millions of yen)
As of October 31, 2017

As of January 31, 2018

28,773994
12,029
1,048
3,247
1,099
21,2693,060
71,521

30,5393,317
12,525
1,090
1,609
519
21,503
3,127
74,233

23,846
2,017
37,127
106
259
431
444
64,234
135,756

25,676
2,080
38,587
−
246
432
428
67,452
141,685

13,652
14,91657,172−2,12983,612

13,652
14,91659,357−2,12985,797

2,538
085
5
2,629
5,547
91,788
227,545

2,538
066
4
2,610
5,819
94,227
235,912

Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term loans payable
Current portion of long-term loans payable
Lease obligations
Income taxes payable
Provision for bonuses
Accounts payable - other
Other
Total current liabilities
Non-current liabilities
Long-term loans payable
Lease obligations
Long-term accounts payable - other
Provision for directors' retirement benefits
Net defined benefit liability
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets－8 －(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive Income(Quarterly Consolidated Statements of Income)(Consolidated Three-month Period ended January 31, 2018)(Unit: Millions of yen)Three months endedJanuary 31, 2017
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Rent income
Foreign exchange gains
Reversal of allowance for doubtful accounts
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of non-current assets
Gain on donation of non-current assets
Subsidy income
Gain on sales of investment securities
Total extraordinary income
Extraordinary losses
Loss on sales and retirement of non-current assets
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent－

9 －Three months ended
January 31, 2018

38,93726,806
12,1307,640
4,490

42,26428,803
13,4618,091
5,370

05419204
29
151
459

464
19
51
25
134
299

59－
41100
4,848

36
25
63
126
5,543

313－
0
170－
3－
3

29
29
4,837
1,259
165
1,425
3,412
283
3,128

21
21
5,525
1,505
301
1,807
3,718
295
3,422

(Quarterly Consolidated Statements of Comprehensive Income)(Consolidated Three-month Period ended January 31, 2018)(Unit: Millions of yen)Three months ended
January 31, 2017
ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustmentRemeasurements of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests－10 －Three months ended
January 31, 2018

3,412

3,718

304
0−54−0250
3,662−00−19−0−20
3,697

3,371

3,403

290

294

(3) Notes Concerning Quarterly Consolidated Financial Statements(Notes Relating to the Going Concern Assumption)
The Company had no material items to report.
(Note on Significant Changes to Shareholders’ Equity)
The Company had no material items to report.
(Business Segment Information)[ Segment information ]I First quarter of the prior consolidated fiscal year (From November 1, 2016 to January 31, 2017)
1. Information concerning net sales and profit or loss of each reporting segment(Unit: Millions of yen)
Reporting segment
Business related to theConstruction Equipment
Rental Division

Other Businesses(See note)

35,5383,399

38,937－－－35,5383,399

38,937

4,070

317

4,388

Net sales
Net sales to outside customers
Net sales or transfers between
related segments
Total
Segment profit

Total(Note) The “Other businesses” classification encompasses business segments not included in the reporting
segment, and includes business related to the Steel Sales Division and the Information Products
Division, welfare-related businesses, and other businesses.
2. Difference between total reporting segment profit or loss and the amount reported on the Quarterly
Consolidated Statements of Income, and the main reasons for the difference (Matters Pertaining toReconciliation of Difference)(Unit: Millions of yen)
IncomeAmount

Reporting segment total
Income for “Other businesses” classification
Other adjustments

4,070
317
101

Operating income reported on the Consolidated
Quarterly Statements of Income

4,490

3. Information concerning fixed asset impairment loss and goodwill by reporting segment
The Company had no material items to report.

－11 －

II

First quarter of the current consolidated fiscal year (From November 1, 2017 to January 31, 2018)
1. Information concerning net sales and profit or loss of each reporting segment(Unit: Millions of yen)
Reporting segment
Business related to theConstruction Equipment
Rental Division

Other Businesses(See note)

37,815

4,449

42,264－－－37,815

4,449

42,264

5,021

250

5,272

Net sales
Net sales to outside customers
Net sales or transfers between
related segments
TotalSegment profit

Total(Note) The “Other businesses” classification encompasses business segments not included in the reporting
segment, and includes business related to the Steel Sales Division and the Information Products
Division, welfare-related businesses, and other businesses.
2. Difference between total reporting segment profit or loss and the amount reported on the Quarterly
Consolidated Statements of Income, and the main reasons for the difference (Matters Pertaining toReconciliation of Difference)(Unit: Millions of yen)
IncomeAmount

Reporting segment total
Income for “Other businesses” classification
Other adjustments

5,021
250
97

Operating income reported on the Consolidated
Quarterly Statements of Income

5,370

3. Information concerning fixed asset impairment loss and goodwill by reporting segment
The Company had no material items to report.

－12 －