SANIX INCORPORATED
Summary of Consolidated Financial Statements
For the Fiscal Year Ended March 31, 2020
[Japanese Standards]

The financial figures in this document are based on Japanese Accounting Standards and accompanying laws. Amounts arerounded off to 1 decimal place. This document is an English translation of the Japanese-language original.

Consolidated Financial Statements for the Fiscal Year ended March 31,
SANIX INCORPORATED
Stock Listed:Tokyo Stock Exchange First Section, Fukuoka Stock Exchange

Code No;

4651

URL:

https://sanix.jp

President and CEO:

Hiroshi Munemasa

Contact:

Kozo Inoue, Management Corporate Officer,
General Manager of Corporate Planning Division, Administration Division andManagement & Planning Division

1. Business Results – Operating results for the Fiscal Year ended March 31,
2020(April 1, 2019 to March 31, 2020)(1) Consolidated Operating Results(In Millions of Yen)
Fiscal Year
From April 1 to March 31
FY2019%change

FY2018%change

Net Sales······························································

52,531

3.6%

50,719

1.5%

Operating Income ··················································

2,791

127.9%

1,224(1.7%)

Ordinary Income ····················································

2,592

119.2%

1,182

16.0%

Net Income ···························································

1,850

670.7%

240(79.6%)Net Income per Share (¥) ········································¥38.72

㸫

¥5.02

㸫

Net Income per Share, Diluted(¥)······························

㸫

㸫

㸫

㸫

Return on Equity ····················································

36.3

㸫

5.9

㸫

Ratio of Recurring Profit to Net Assets ·······················

8.2

㸫

3.9

㸫

Ratio of Operating Income to Net Sales ·····················

5.3

㸫

2.4

㸫

(Note) Comprehensive Income ································

1,863

㸫

117

(90.4%)(2) Consolidated Financial Position(In Millions of Yen)
Fiscal YearAs of March 31
FY2018FY2019Total Assets ···························································

32,51431,009Net Assets ····························································

6,056

4,193

Shareholders’ Equity Ratio (%) ·······························

18.5%

13.4%

Net assets per share(¥) ···········································¥126.15¥87.08(Reference) Equity Capital ·······································

6,030

4,162

(3) Consolidated Financial Cash Flows(In Millions of Yen)
Fiscal Year
From April 1 to March 31
FY2018FY2019Cash Flows from Operating Activities·························

4,080

(25)

Cash Flows from Investing Activities ··························(2,154)(947)

Cash Flows from Financing Activities ·······················(1,110)392

Cash and Equivalents ,End of Period ························

5,259

4,497

2. Dividends
Quarterly Period
Total

1st

2nd

3rd

4th

Quarter

Quarter

Quarter

Quarter

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

AnnualPayoutDividends

Dividend

ratio

to Net Assets

paid(consolidated)(consolidated)

㸫

㸫

㸫

㸫

㸫

㸫

(Dividends per Share)
FY2018 ended March 31,

2019 ································································FY2019 ended March 31,

0.00

0.00

2020 ································································FY2020 ended March 31,

0.00

0.00

㸫

2021(Forecast) ································

3. Forecasts for Consolidated Business Results (April 1, 2020 to March 31, 2021)
Forecasts for the consolidated business results for the fiscal year ending March 31, 2021 have not yet
been determined because it is difficult to rationally assess the impact that the COVID-19 outbreak will haveon the Japanese economy and business results of the Company. The Company will announce them assoon as possible in the months ahead.

* Notes(1) Changes in significant subsidiaries during the period(Changes in scope of consolidations resulting from change in subsidiaries): None
Number of subsidiaries newly consolidated㸫
Name of subsidiaries newly consolidated㸫
Number of subsidiaries excluded from consolidation㸫Name of subsidiaries excluded from consolidation
㸫(2) Changes in accounting policies and accounting estimates retrospective restatementϸ) Changes in accounting policies based on revisions of accounting standard: NoneϹ) Changes in accounting policies other than ones based on revisions of accounting standard: NoneϺ) Changes in accounting estimates: Noneϻ) Retrospective restatement: None
(3) Number of issued and outstanding shares (common stock)(Shares)
End of term
FY 2019

FY 2018

Number of issued and outstanding shares ,end of period (including treasury stock)48,919,396

48,919,396

Number of treasury stock at the end of period ··························································

1,114,443

1,114,173

Average number of shares during the period ···························································

47,805,137

47,805,411(Reference) Business Result-Overview of non-consolidated Operating Results
1. Business Results – Operating results for the Fiscal Year ended March 31, 2020
(April 1, 2019 to March 31, 2020)(1) Non-Consolidated Operating Results(In Millions of Yen)
Fiscal Year
From April 1 to March 31
FY2019%change

FY2018%change

Net Sales······························································

49,2883.1%

47,825

6.5%

Operating Income ··················································

1,271

147.7%

513

413.3%

Ordinary Income ····················································

1,598

119.3%

729

71.4%

Net Income ···························································

1,069

㸫

(62)

㸫

Net Income per Share (¥) ········································¥22.36㸫(¥1.30)㸫Net Income per Share, Diluted(¥)······························

㸫

㸫

㸫

㸫

(2) Non-Consolidated Financial Position(In Millions of Yen)
Fiscal YearAs of March 31
FY2018FY2019Total Assets ···························································

26,94725,649Net Assets ····························································

3,075

2,035

Shareholders’ Equity Ratio (%) ·······························

11.4%

7.9%

Net assets per share(¥) ···········································¥64.33¥42.59(Reference) Equity Capital ·······································

3,075

2,035

* This summary of financial statements is exempt from audit procedure required by Financial instruments
and Exchange Act.
* Note to ensure appropriate use of forecasts:
on assumptions, prospects and plans as of the date of this document. Actual results may differ significantly from these forecasts,
due to various factors affecting the Company’s business performance, such as change in economical conditions. For details ofthese assumptions, prospects and plans, and for notes appropriate use of forecasts for the business results, please see page 6 of
the Attachment.

1. Index of the attachment
1. Information on Business Results & Financial Position for the fiscal year
ended March 31, 2020 ...............................................................................................
2(1) Information on Consolidated Business Results ............................................................................
2(2) Information on Consolidated Financial Position ............................................................................
4(3) Information on Consolidated Cash Flows ......................................................................................
5(4) Outlook for the next fiscal year ........................................................................................................
6

2. Basic Position regarding the Choice of Accounting Standards ...................................
8
3. Consolidated Financial Statements and Main Notes to the Statements ....................
9(1) Consolidated Balance Sheets ..........................................................................................................
9(2) Consolidated Statements of Income and Comprehensive Income ............................................
11
Consolidated Statements of Income .............................................................................................
11
Consolidated Statements of Comprehensive Income ................................................................
12(3) Consolidated Statements of Changes in Net Assets. ............................................................
13(4) Consolidated Statements of Cash Flows .......................................................................................
15(5) Notes to the Consolidated Financial Statements ..........................................................................
17
Notes to the Assumption of a Going Concern .............................................................................
17
Segment Information ...................................................................................................................17Per-share information ..................................................................................................................20
Significant subsequent events ...................................................................................................20

4. Supplemental Information .............................................................................................................
21
Consolidated Net Sales by Division.......................................................................................................21

2

1. Information on Business Results & Financial Position for the fiscal
year ended March 31, 2020
(1) Information on Consolidated Business Results
In the fiscal year ended March 31, 2020 (April 1, 2019 to March 31, 2020), theJapanese economy moderately recovered with corporate earnings remaining high andconsumer spending on an upward trend. Toward the end of the fiscal year under review,
however, the situation became extremely severe due to increased uncertainty, including
the rapid deterioration of the economy due to the effects of COVID-19 and a sharp fallin crude oil prices.
Under these circumstances, the Group aimed to achieve further growth bydeveloping new businesses and services, while prioritizing the establishment of a stableprofit structure based on existing businesses under the Medium-Term Management
Plan (FY2019 to FY2021).
As for net sales in the fiscal year under review, sales increased in the Solar
Engineering (SE), Home Sanitation (HS), Establishment Sanitation (ES) and
Environmental Resources Development (ERD) Divisions, and net sales of the entire
Group stood at ¥52,531 million (up 3.6% year on year).
Profit increased significantly as a reaction to the adverse effects of the Hokkaido
Eastern Iburi earthquake that occurred in the previous fiscal year in the ERD Division.
As a result, for the entire Group, operating income came to ¥2,791 million (up127.9% year on year), and ordinary income amounted to ¥2,592 million (up 119.2%
year on year). Net income attributable to the owners of the parent company stood at¥1,850 million (up 670.7% year on year), showing a significant rise as a result of
posting expenses for restoring the facilities due the aforementioned earthquake as
extraordinary losses of ¥472 million in the previous fiscal year.
Consolidated results of individual divisions for this fiscal year were as follows:a. Solar Engineering (SE) Division
In the SE Division, the solar electric power market, which had continued contracting,bottomed out and turned upward from the previous fiscal year. The Company also
reviewed sales prices in response to lower FIT prices and promoted new sales
approaches, such as sales of solar electric power systems with land for investors who
do not own land. As a result, sales of solar electric power systems increased 8.4% year
on year, and net sales came to ¥15,195 million (up 5.3% year on year).
Operating income increased due to higher sales and a fall in the cost of materials,
but the Division decided to record inventories for power conditioners that were
manufactured in house and posted ¥644 million as a loss on valuation of inventories.
This was because the Division revised the sales forecast and took the collectability ofreceivables into account following the abolishment of sales of all electricity of 10kW or3more and less than 50kW and its shift from surplus electricity sales to sales for
self-consumption in the FIT system from FY2020. As a result, the Division posted
operating income of ¥901 million (down 25.1% year on year).
b. Home Sanitation (HS) Division
The HS Division strengthened the sales and construction systems for the Division to
be able to carefully craft proposals for the maintenance of ordinary houses by
increasing personnel through recruitment and newly establishing two sales bases(Karatsu Sales Office and Omura Sales Office). As a result, termite extermination
increased 3.1% year on year, and underfloor/ceiling ventilation systems rose 38.8%
year on year, resulting in the division’s sales of ¥11,235 million (up 4.5% year on year).
Operating income stood at ¥2,061 million (down 7.6% year on year) due to a rise incosts such as personnel expenses caused by the addition of personnel to expand ouroperations despite higher sales.
c. Establishment Sanitation (ES) Division
The ES Division enhanced relationships with the owners of buildings andcondominiums and partner companies, including management companies, byincreasing personnel through recruitment and newly establishing a sales base (Saitama
Office). As a result, sales of anti-rust equipment installation (brand name: Daelman
Shock), our main product, increased 21.3% year on year, and sales of building
waterproof paint repair increased 55.3% year on year, resulting in the division’s sales of¥2,261 million (up 17.4% year on year).
Operating income declined to ¥281 million (down 1.9% year on year) due to a rise incosts such as personnel expenses caused by the addition of personnel to expand theoperations size despite higher sales.
d. Environmental Resources Development (ERD) Division
Plastic fuel sales increased 17.4% year on year because the Division emphasized an
improvement in the profitability and quality of plastic fuels, although the acceptancevolume of waste plastics decreased due to the careful examination of accepted articles.
At the Tomakomai Power Plant, power plant sales increased 43.5% year on year as areaction to six months of suspended operation in the third and fourth quarters of theprevious fiscal year (September 2018 to March 2019) caused by the Hokkaido Eastern
Iburi earthquake. Final disposal also rose 42.4% year on year. As a result, net sales
amounted to ¥16,759 million (up 18.7% year on year).
Operating income increased to ¥3,483 million (up 721.7% year on year) thanks to arise in the number of operation days at the Tomakomai Power Plant and higher sales ofthe final disposal business, in addition to an improvement in the profitability and qualityof plastic fuels due to the careful examination of waste plastics and accepted articles in
the organic wastewater recycling.

4e. Energy Business (EB) Division
In the Energy Business Division, net sales declined due to a fall in retail sales causedby the declining number of high pressure contracts in the Power Producer and Supplier(PPS) business and a fall in the wholesale unit price caused by declining transaction
prices in the wholesale market (JEPX). On the other hand, the Division started
business that combined solar power generation and electricity retailing as a set inpartnership with other companies, but this was insufficient to offset the sales decline.
As a result, net sales stood at ¥9,132 million (down 13.9% year on year).
The Division posted an operating loss of ¥485 million (compared with operating
income of ¥412 million in the previous fiscal year) due to lower net sales and the impactof the falling profit ratio resulted from the rising wholesale ratio.

(2) Information on Consolidated Financial Position
Information on the status of Assets, of Liabilities, and of Net Assets
Total assets as of the end of the fiscal year under review amounted to ¥32,514 million,
an increase of ¥1,505 million from the end of the previous consolidated fiscal year.
Total liabilities stood at ¥26,458 million, a decrease of ¥357 million from the end of theprevious consolidated fiscal year. Net assets totaled ¥6,056 million, a rise of ¥1,862
million from the end of the previous consolidated fiscal year. As a consequence, theshareholders equity ratio stood at 18.5% as of March 31, 2020.
(The status of Assets)
Current assets decreased ¥336 million, or 2.0%, year on year and stood at ¥16,277
million, which was caused chiefly by a decrease in merchandise and finished goods of¥963 million, despite an increase in cash and deposits of ¥681 million.
Fixed assets increased ¥1,841 million, or 12.8%, year on year and came to ¥16,237
million, which was caused chiefly by increases in construction in progress of ¥763
million and machinery, equipment and vehicles of ¥716 million.
(The status of Liabilities)
Current liabilities decreased ¥1,953 million, or 8.3%, year on year and stood at¥21,576 million, which was attributable largely to a decrease in short-term loans
payable of ¥2,772 million, while current portion of long-term loans payable increased¥784 million.
Non-current liabilities increased ¥1,596 million, or 48.6%, year on year and arrived at¥4,881 million, which was attributable chiefly to increases in bonds of ¥500 million,
lease obligations of ¥238 million and liability related to retirement benefits of ¥85
million.

5(The status of Net Assets)
Net assets rose ¥1,862 million, or 44.4%, year on year and came to ¥6,056 million, which
was caused mainly by the posting of profit attributable to owners of parent of ¥1,850
million.
(3) Information on Consolidated Cash Flows
Cash and cash equivalents (hereinafter called “funds”) as of the end of the fiscal year
under review was ¥5,259 million, an increase of ¥761 million from the end of theprevious year.
Cash flows and reasons for changes in cash flows during the period are described
below.
(Net Cash Provided by Operating Activities)
Net cash provided by operating activities was ¥4,080 million (expenditure of ¥25
million in the previous year), which was mainly caused by the posting of income before
income taxes and minority interests of ¥2,592 million, a decrease in inventories of ¥930
million and the posting of depreciation and amortization of ¥914 million as a non-cash
expenditure.
(Net Cash Provided by Investment Activities)
Net cash used in investing activities was ¥2,154 million (expenditure of ¥947 million in
the previous year), which was largely caused by an expenditure of ¥1,956 million due tothe purchase of property, plant and equipment.
(Net Cash Provided by Financing Activities)
Net cash used in financing activities was ¥1,110 million (proceeds of ¥392 million in
the previous year), which was chiefly caused by a net decrease in short-term loans
payable of ¥2,772 million, despites proceeds of ¥1,072 million due to long-term loans
payable and ¥500 million due to the issuance of bonds.
(Reference: The Cash Flow Indicators)

Shareholders’ equity ratio
Shareholders’ equity ratio on a market
price basis
Interest-bearing liabilities ratio to cash
flow

FY2015FY2016

Fiscal Year
FY2017FY2018FY2019

8.3%

8.9%

13.5%

13.4%

18.5%

32.9%

28.9%

43.8%

37.5%

42.0%

-

8.77

5.85

-

3.04

-

6.76

10.81

-

21.61

Interest coverage ratio(Note) Shareholder’s equity ratio:

Shareholder’s equity/Total assets

Share ratio on a market price basis:

Total market value of stock/Total assets

Interest-bearing liabilities ratio to cash flow:
Interest coverage ratio:

Operating cash flow/Interest payment

Operating cash flow/Interest payment

1. The basis of the calculation for all values is consolidated financial data.
2. Market capitalization is calculated by multiplying the closing price of SANIX shares at the end of the6fiscal year by the number of shares outstanding at the end of the fiscal year.
3. Operating cash flow refers to Cash Flows from Operating Activities according to the consolidated
statement of cash flows. Interest-bearing liabilities are comprised of all liabilities on the consolidatedbalance sheet on which interest is payable. Interest expenditure refers to interest expenses paid
according to the consolidated statement of cash flows.

(4) Outlook for the next fiscal year
Forecasts for consolidated business results for the fiscal year ending March 31, 2021
have not yet been determined because it is difficult to rationally assess the impact that
the COVID-19 outbreak will have on the Japanese economy and business results of theCompany. The Company will announce them as soon as possible in the months ahead.
Even under such circumstances, the Group will continue to work on the creation of asustainable society based on its corporate philosophy of “A comfortable environment
for the next generation” through new challenges by taking advantage of past businessexperience in the living environment, the resource cycle and the energy domains.
The SE Division has been expanding the solar power electricity business withelectricity generated by solar power as an investment product based on the FIT system
under the assumption that all the electricity would be purchased. However, because the
FIT system has become an institutional design based on self-consumption in the fiscal
year under review, the Division expects that its product concept and its proposals will
undergo significant changes. For this reason, the Division expects that, in the first halfof the fiscal year ending March 31, 2021, its sales activities to be centered on theconstruction and sales of solar electric power systems with land to which FIT has
already been applies by the fiscal year ended March 31, 2020 and that are currently
under review or have already been accredited. Yet the Division anticipates that thesecond half will be a transitional period when it will try to gradually increase
self-consumption projects.
However, the Division is unable to fully implement sales activities from the standpointof preventing the spread of COVID-19, and risks such as a decline in companies’
motivation for capital investment and the tightened screening of financial institutions in
lending to customers are expected. Nevertheless, the Division thinks that
self-consumption-type solar power generation, which will be able to reduce
environmental burdens and electricity costs, will become widespread over the medium
to long term.
The HS Division has been aiming to provide customers with finely tuned services byenhancing its sales and construction systems through the active recruitment of humanresources and in-depth education for their cultivation. However, given that the Division
took the form of door-to-door sales in which sales personnel visit customers’ houses,

7

the Division recognizes that this business will be the most affected by the recent spreadof COVID-19. The Division will respond flexibly in its business activities in light of thesituation where COVID-19 is spreading and that the central and local government
request the voluntary suspension of business, etc.
The ES Division has been expanding sales channels for the anti-rust equipment
installation (brand name: Daelman Shock), its main product, by cultivating partners
such as management companies, introducing existing partners through close
follow-ups, and increasing opportunities for direct business talks with real estate
owners. The voluntary suspension of business by management companies reflecting
the current spread of COVID-19 has impacts such as the fall in requests from
customers, the revision of repair plans and the inspection time of buildings andcondominiums.
The ERD Division has been promoting an improvement in the quality of plastic fuels
and the efficient operation of plants by fully enforcing a close examination of accepted
articles. The Division will continue to increase profitability by maintaining a close
examination of accepted articles and will aim for growth while recognizing the role
played by the resource cyclic-type business in society. As a business operator thatmanages waste, the Company will continue its business even under the situation where
COVID-19 is spreading, but recognizes that the Company will be affected if industrial
activities in Japan are diminished significantly.
The energy business division will promote a business alliance to increase the numberof retail contracts and work to stabilize profitability by reviewing the business structure.
The division will also promote the development of energy-related businesses incollaboration with other companies’ services and will use them as a foothold to create a
new business model.
(Company’s measures to prevent the spread of infectious diseases by thecoronavirus)
With respect to measures to address COVID-19, the Group will make efforts tocontinue its business in consideration of the situation that changes daily while
prioritizing the safety of customers, business partners, community residents andemployees and their families, preventing infections and any further spread.
(Details of the Company’s measures are posted on its website)8

2. Basic Position regarding the Choice of Accounting Standards
The Group will use the Japanese standards for the time being. In addition, our policy is
to take proper steps toward the adoption of the International Financial ReportingStandards while giving due consideration to the circumstances in Japan and othercountries.

9

3. Consolidated Financial Statements and Main Notes to the Statements(1) Consolidated Balance Sheets(In Millions of Yen)

As of March 31
FY2019FY2018Assets :Current Assets :Cash and deposits

5,238

5,919

Notes and accounts receivable-trade

6,010

5,453

Merchandise and finished goods

1,019

56

Work in process-construction

122

333

Raw materials and supplies

3,546

3,354

975

1,362

Other

(299)

(202)

16,613

16,277

9,439

9,531

Less: Accumulated depreciation(7,537)(7,799)Buildings and structures (net of depreciation)

1,901

1,732

Allowance for doubtful accounts
Total current assets
Fixed Assets:
Tangible fixed assets :Buildings and structures, net

Machinery, Equipment and vehicles, net
Less: Accumulated depreciation

11,955

12,682(10,600)(10,611)

1,355

2,071

Land

7,811

8,053

Lease assets, net

Machinery, Equipment and vehicles (net of depreciation)

1,143

1,346

Less: Accumulated depreciation

(513)

(563)

Lease Assets, net

630

782

159

923

1,013

983

Less: Accumulated depreciation

(814)

(807)

Other, net

199

176

12,057

13,739262

450

Investment securities

129

86

Deferred tax assets

612

614

609

580

1,301

1,348

Construction in progress
Other, net

Total Tangible fixed assets
Intangible fixed assets
Investments and other assets :Lease and guarantee deposits
Other
Allowance for doubtful accounts

(578)

(582)

Total investments and other assets

2,074

2,047

Total fixed assets

14,395

16,237

Total Assets

31,00932,514

10(In Millions of Yen)

As of March 31
FY2019FY2018

Liabilities :Current Liabilities :Notes and accounts payable-trade

4,188

3,716

Short-term loans payable

12,297

9,525

143

928

Accounts payable

3,930

3,471

Accrued expenses

1,098

1,156

Lease obligations

246

322

Accrued income taxes

462

687

Accrued consumption taxes

Current portion of long-term loans payable

368

615

Provision for bonus

4

256

Allowance for resource-recycling expenses

12

5

780

892

23,52921,576-500

Long-term loans payable

210

262

Lease obligations

575

859

Long-term lease deposited

45

45

Provision for directors’ retirement benefits

99Provision for disposal site closing expenses

603

637

1,642

1,727

198

838

Other
Total current liabilities
Non-Current Liabilities :Bonds payable

Liability related to retirement benefits
Other

3,285

4,881

26,81526,45814,041

14,0411

1Retained earnings(8,357)(6,506)

Treasury stock(1,481)(1,481)

Total shareholders’ equity

4,204

6,055

Valuation difference on available-for-sale securities

60

31

Foreign currency translation adjustment

(17)

(90)

Adjustment for retirement benefits (cumulative)

(85)

34

Total valuation and translation adjustments

(42)

(25)

31

26

Total non-current liabilities
Total Liabilities

Net Assets :Shareholders’ Equity :Capital stock
Capital surplus

Valuation and translation adjustments :Non-controlling Interests
Total Net Assets

4,193

6,056

Total Liabilities and Assets

31,00932,514

11(2) Consolidated Statements of Income and Comprehensive Income(Consolidated Statements of Income)(In Millions of Yen)

From April 1 to March 31
FY2019FY2018Net sales

50,71952,531

Cost of Sales

35,88934,974Gross Profit

14,83017,556509

619

Selling, General and Administrative expenses
Sales commission
Advertising expenses

369

325

Provision of allowance for doubtful accounts

(38)

(62)

Salaries and bonuses

7,093

7,723

Provision for bonuses

0163

Retirement benefit expenses

172

242

Legal welfare expenses

869

1,010

Rent expenses

931

927

150

189

Others

3,547

3,626

Total selling, general and administrative expenses

13,605

14,765

1,224

2,791

11

17

Depreciation

Operating Income (Loss)
Non-Operating Income :Interest income
Dividends income22Land and house rent revenue

64

63

Subsidy income

1032Compensation received

70

-

Other

49

48

Total non-operating income

209

164

Interest expenses

216

208

Other

35

155

Non-Operating Expenses :

251

363

1,182

2,592

Loss on disaster472-

Total extra ordinary loss

472-

Income (Loss) Before Income Taxes and Minority Interests

710

2,592

Income Taxes-Current

498

734

Income Taxes-Deferred

(24)

11

Total Income Taxes

473

746

Net Income

236

1,846

Net Income (Loss) Belonging to the Non-Controlling Shareholders
Net income (Loss) Belonging to the Shareholders of the Parent
Company

(3)

(4)

240

1,850

Total non-operating expenses
Ordinary Income (Loss)
Extra Ordinary Loss :12(Consolidated Statements of Comprehensive Income)(In Millions of Yen)

From April 1 to March 31
FY2019FY2018
Income Before Minority Interests

236

1,846

Other Comprehensive Income :Valuation difference on available-for-sale securities

(15)

(29)

0

-

Foreign currency translation adjustment

(20)

(73)

Retirement benefit adjustment

(83)

120

Total other comprehensive income

(118)

16

117

1,863

121

1,867

(3)

(4)

Deferred gains or losses on hedges

Comprehensive Net Income
Comprehensive Income Attributable toComprehensive income (loss) belonging to the shareholders of
the parent company
Comprehensive income (loss) belonging to non-controllingshareholders

13(3) Consolidated Statements of Changes in Net Assets
The previous consolidated fiscal year (April 1, 2018 to March 31, 2019)(In Millions of Yen)

Shareholders’ equity
CapitalsurplusCapital stock
Balance at the beginning ofcurrent period

14,041Retainedearnings
1

Total
shareholders’equityTreasurystock(8,597)(1,481)

3,964

Changes of items during theperiodNet income belonging to theshareholders of the parent
company

240

Purchase of treasury stock

240
(0)

(0)

Net changes of items otherthan shareholders’ equity
Total changes of items
during the period

-

-

240

(0)

240

Balance at the end ofcurrent period

14,041

1(8,357)(1,481)

4,204(In Millions of Yen)

Accumulated other comprehensive income

Balance at the
beginning of current
periodValuationdifferenceonavailable-f
or-salesecurities

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustment

76

(0)

3

Total
Retirement accumulated Minority
interests
benefitsotheradjustment comprehen-s
ive income
(2)

76

35

Total net
assets4,076

Changes of items
during the period
Net income
belonging to theshareholders of theparent company
Purchase oftreasury stock
Net changes of
items other thanshareholders’ equity
Total changes of
items during theperiodBalance at the endof current period

240

(0)
(15)

0

(20)

(83)

(118)

(4)

(122)

(15)

0

(20)

(83)

(118)

(4)

117

60

-

(17)

(85)

(42)

31

4,193

14

The consolidated fiscal year (April 1, 2019 to March 31, 2020)(In Millions of Yen)

Shareholders’ equity
CapitalsurplusCapital stock
Balance at the beginning ofcurrent period

14,041Retainedearnings
1

Total
shareholders’equityTreasurystock(8,357)(1,481)

4,204

Changes of items during theperiodNet income belonging to theshareholders of the parent
company

1,850

Purchase of treasury stock

1,850
(0)

(0)

Net changes of items otherthan shareholders’ equity
Total changes of items
during the period

-

-

1,850

(0)

1,850

Balance at the end ofcurrent period

14,041

1(6,506)(1,481)

6,055(In Millions of Yen)

Accumulated other comprehensive income
Valuationdifferenceonavailable-f
or-salesecurities
Balance at the
beginning of current
period60

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustment

-

(17)

Total
Retirement accumulated Minority
interests
benefitsotheradjustment comprehen-s
ive income
(85)

(42)

31

Total net
assets4,193

Changes of items
during the period
Net income
belonging to theshareholders of theparent company
Purchase oftreasury stock
Net changes of
items other thanshareholders’ equity
Total changes of
items during theperiodBalance at the endof current period

1,850

(0)
(29)

-

(73)

120

16

(4)

12

(29)

-

(73)

120

16

(4)

1,862

31

-

(90)

34

(25)

26

6,056

15

(4) Consolidated Statements of Cash Flows(In Millions of Yen)

April 1 to March 31
FY2019FY2018Net Cash Provided by (used in) Operating Activities :Income before income taxes and minority interests

710

2,592

Depreciation and amortization

808

914

Amortization of goodwill

65-

Increase (Decrease) in provision for bonuses

0251

Increase (Decrease) in allowance for disposal site closing expenses

30

34

Increase (Decrease) in allowance for resource-recycling expenses

(15)

(7)

Increase (Decrease) in liabilities in retirement

94

205

Increase (Decrease) in allowance for doubtful accounts

(284)

(92)

Interest and dividends income

(13)

(20)

Interest expenses

216

208

Decrease(Increase) in notes and accounts receivable-trade

(525)

557

Decrease(Increase) in inventories

(173)

930

Decrease(Increase) in other current assets

(72)

(203)

Increase (Decrease) in notes and accounts payable-trade

(877)

(417)

Increase (Decrease) in accounts payable – other

833

(751)

Increase (Decrease) in consumption tax refund receivable

(41)

210

Increase (Decrease) in other current liabilities

(62)

277

Other

(78)

180

Subtotal

615

4,871

Interest and dividends income received

13

20

Interest expenses paid

(233)

(188)

Income taxes paid

(457)

(632)

Income taxes refund

35

10

Net cash provided by operating activities

(25)

4,080

(676)

(625)

Net Cash Provided by (used in) Investment Activities :Payments into time deposits
Proceeds from withdrawal of time deposits

324

658

Purchase of tangible fixed assets(577)(1,956)

Proceeds from sales of tangible fixed assets

3

9

Purchase of intangible assets

(7)

(236)

Other

(13)

(4)

Net cash provided by investing activities(947)(2,154)

Increase (Decrease) in short-term loans payable612(2,772)

Proceeds from long-term loans payable

20

1,072

Repayments of long-term loans payable

(131)

(235)

-

500

(187)

(235)

79

561

Net cash provided by financing activities
Effect of Exchange Rate Changes on Cash and Cash
Equivalents

392(1,110)(5)(54)

Net Increase (Decrease) in Cash and Cash Equivalents

(585)

761

Net Cash Provided by (used in) Financing Activities :Proceeds from issuance of bonds
Repayments of finance lease obligations
Other

16

Balance of Cash and Equivalents at beginning of period

5,083

4,497

Balance of Cash and Equivalents at end of period

4,497

5,259

17

(5) Notes to the Consolidated Financial Statements(Notes to Assumption of Going Concern): None(Segment Information, etc.)【Overview of reportable segments】
The reportable segments of the Group are its constituents for which separate financial
information is available and the Board of Directors regularly examines to determine the
distribution of management resources and evaluate performance. (Segment
Information, etc.)
SE Division
The segment sells and constructs industrial and residential solar electric powersystems. The Company also wholesales solar electric power systems and equipment.
HS Division
The segment performs construction related to environmental sanitation for generalhouseholds, specifically termite extermination, basic repair work and the constructionof underfloor and ceiling ventilation systems.
ES Division
The segment performs construction related to environmental sanitation for companies,
specifically the maintenance and construction of water supply and drainage facilities ofbuildings and condominiums.
ERD Division
The Company sells plastic fuels to SANIX ENERGY INCORPORATED, a consolidated
subsidiary. The subsidiary operates the electricity sales business by using plastic fuelspurchased from the Company and its consolidated subsidiary Hokkaido SANIX
Environment Incorporated, and incinerated ashes generated by SANIX ENERGYINCORPORATED are disposed of by C&R Landfill Incorporated, a consolidated
subsidiary. SE Wings Incorporated conducts the PPS business by purchasing
electricity from SANIX ENERGY INCORPORATED.
EB Division
The segment conducts the PPS business for corporations and general households.
It also engages in the sale and construction work of the third party ownership (TPO)
model of solar power generation for general households.

18

2.Calculation method of net sales, profits, losses, assets, liabilities and other items byreporting segment
The accounting method of the reported business segments is the same as that statedin “Significant Items Regarding Preparation of Consolidated Financial Statements.”
Profits in the reportable segments are based on operating income. Intersegment sales
or transfers are determined by reference to current market values.

ⅢThe previous Fiscal Year(From April 1, 2018 to March 31, 2019)i)Information concerning the Amount of Net Sales and Operating Income (loss) bysegment(In Millions of Yen)

Segments

Elimination
or Group(note 1)

Consolidated(note 2)

SE

HS

ES

ERD

EnergyTotal

14,427

10,752

1,926

13,003

10,60950,719-50,719

-

-

-

1,113

-

1,113

(1,113)-

Total

14,427

10,752

1,926

14,116

10,60951,832(1,113)50,719Operating income (loss)

1,204

2,231

287

423

412

4,560

(3,335)

1,224

Segment assets

8,873

1,861

594

11,9301,554

24,813

6,195

31,009OthersDepreciation

103

54

6

561

2

723

80

808

―

―

―

65

―

65

―

65

10

46

5

821

1

886

194

1,080

Sales:
Sales to customers
Internal sales
Among segments andtransfer accounts

Amortization of goodwill

Increase in property,
plant and equipment andintangible assets(note 1)

Negative ¥3,335 million for adjustments of Operating income (loss) represents corporate expenses notallocated to reportable segments. Corporate expenses are mainly general and administrative expenses
note attributable to reportable segments.
(note2) An adjustment of segment assets is the Company assets of ¥6,195 million that are not allocated to
the reportable segments and consist mainly of surplus funds for investment (cash and deposits), long-term
invested funds (investment securities) and assets related to administrative divisions.
(note 3)Operating income (loss) is adjusted to operating loss of quarterly consolidated statements of income.

19

ⅢThe Fiscal Year (From April 1, 2019 to March 31, 2020)ii) Information concerning the Amount of Net Sales and Operating Income (loss) by
Segment(In Millions of Yen)

Segments

Elimination
or Group(note 1)

Consolidated(note 2)

SE

HS

ES

ERD

EnergyTotal

15,195

11,2352,261

14,706

9,132

52,531-52,531

-

-

-

2,053

-

2,053

(2,053)-

15,195

11,2352,261

16,7599,132

54,584(2,053)52,531

Sales:
Sales to customers
Internal sales
Among segments andtransfer accounts
Total
Operating income (loss)

901

2,061

281

3,483

(485)

6,243

(3,452)

2,791

Segment assets

6,759

2,185

576

14,4491,535

25,506

7,008

32,514

OthersDepreciation

78

47

4

653

3

786

127

914

―

―

―

―

―

―

―

―

88

36

2

2,210

6

2,345

396

2,742

Amortization of goodwill

Increase in property,
plant and equipment andintangible assets(note 1)
Negative ¥2,053

million for adjustments of Operating income (loss) represents corporate expenses notallocated to reportable segments. Corporate expenses are mainly general and administrative expenses
note attributable to reportable segments.
(note2)

An adjustment of segment assets is the Company assets of ¥7,008 million that are not allocatedto the reportable segments and consist mainly of surplus funds for investment (cash and deposits),
long-term invested funds (investment securities) and assets related to administrative divisions.
(note 3)Operating income (loss) is adjusted to operating loss of quarterly consolidated statements of income.

20(Per-share information)
FY2018(From April 1, 2018

FY2019(From April 1, 2019 toto March 31, 2019)

March 31, 2020)

Net assets per share(¥)¥87.08¥126.15Net Income per Share, Diluted(¥)¥5.02¥38.72

1.Fully diluted net income per share is not stated because there are no dilutive shares.
2. The calculation basis of net assets per share is as follows.

Total amount in net assets

FY2018(From April 1, 2018

FY2019(From April 1, 2019 toto March 31, 2019)

March 31, 2020)

4,193

6,056

Amounts deducted from the total
amount in net assets

31

26

Non-controlling interests

(31)

(26)

Net assets at the end of period oncommon shares

4,162

6,030

Number of common shares at theend of period used in calculation of
net assets per share

47,805,223

47,804,953

3.The calculation basis of net income per share is as follows.
FY2019(From April 1, 2019 toto March 31, 2019)

March 31, 2020)

Net Income per Share, Diluted(¥)

240

1,850

The calculation basis of net income
per share is as follows－－

Profit attributable to owners
parent on common shares

240

1,850

47,805,411

47,805,137

of

Average number of common shares
during the fiscal year (shares)(Significant subsequent events)
None

FY2018(From April 1, 2018

21

4. Supplemental Information
Consolidated Net Sales by Division(In Millions of Yen)

By period
By item

From April 1 to March 31
FY2019FY2018Changes

13,66114,807

1,146

Wholesales of PV Components

578

269

(308)

Others

188

117

(70)

Commercial PV System

Solar Engineering Total

14,427

15,195

767

Termite Eradication Service

3,441

3,547

106

Under-Roof / Roof Ventilation System
Foundation Repairing/Home Reinforcement
System

1,779

2,497

698

2,126

1,881

(245)

3,384

3,308

(76)

10,752

11,235482

Anti-rust Equipment Installation

927

1,124

197

Repair of Building Water-woks

447

469

22

Water Proofing of Building

188

292

104

Others

362

374

11

OthersHome Sanitation Division Total

Establishment Sanitation Division Total

1,926

2,261

335

Plastic Fuel

8,615

10,111

1,496

Generation of Electricity
Industrial Waste (Organic Waste Water
Recycle)

2,107

3,023

916

1,958

1,968

10

788

1,122

334

646

533

(113)

14,116

16,7592,643

10,6098,954(1,655)

Final Disposal
OthersEnvironmental Resources Development
Division Total :Electricity Sales

-

177

177

Energy Business Division Total:

10,6099,132(1,477)

Adjustment of inter-segment sales(1,113)(2,053)(939)

Total Net Sales

50,71952,531

1,811

Others(note) We have omitted description on the information that is too multifarious to see the exact volume ofitem.