Consolidated Financial Results for the Fiscal Year Ended December 31, 2019
[Japanese GAAP]
February 13, 2020
Listed company
nameCode number
Representative
Contact person

Frontier Management INC.
7038
(Title)(Title)Listed Exchange East

URL https://www.frontier-mgmt.com
Representative Director
Shoichiro Onishi
Director and General Manager(Name) Yoshiaki
of Corporate Administration
Takahashi
Dept.
Scheduled date ofMarch 27, 2020
commencement ofdividend payment

TEL 03-6862-8335

Scheduled date of theordinary general meeting ofshareholders
Scheduled date to file
March 27, 2020
Securities Report
Preparation of supplementarymaterial on financial results: Yes
Financial results briefing: Yes(for institutional investors and analysts)

March 30, 2020

(Millions of yen are rounded down)
Consolidated results for the year ended December 31, 1.2019 (January 1, 2,019 to December 31, 2019)(1) Consolidated Results of Operations(Percentages indicate year-on-year changes.)
Profit attributable to owners
Net sales
Operating income
Ordinary incomeof parent
Net income
JPY mil.
%
JPY mil.
%
JPY mil.
%
JPY mil.
%
△1.4
△9.1
FY12/2019
4,771
1.7
663
678
0.3
429
FY12/2018
4,690
20.9
672
167.4
676
166.1
472
227.6
(NOTE)JPY
JPY(△9.4%)
Comprehensive
FY12/2019430
FY12/2018
475(232.6%)mil.
mil.
incomePer share
Net income

FY12/2019
FY12/2018(Reference) Equity inearnings of affiliates

Fully diluted
Net income per share
Yen
75.30
91.29

Yen
73.37
90.61

FY12/2019

13

JPY
mil.

Shareholders'equityNet income
margin%21.0
35.8

FY12/201813

Total assets
Net sales
Ordinary income Operating income
ratio
margin
%
19.7
24.2

%
13.9
14.3

JPY
mil.

(NOTE) We conducted a 1000-for-1 stock split on July 13, 2018 and a 2-for-1 stock split on October 1, 2019. Net income per share and diluted net income pershare are calculated as if the stock split had taken place at the beginning of the previous fiscal year.

(2) Consolidated Financial Position
Total assets
JPY mil.
FY12/2019
3,269
FY12/2018
3,623
Reference:
FY12/2019
2,185
Shareholders' equity

Net assets
JPY mil.
2,185
1,897
JPY
mil.

FY12/2018

Equity Ratio
%
66.8
52.4
1,897

Net assets per shareYen
383.26332.78JPY
mil.

(NOTE) We conducted a 1000-for-1 stock split on July 13, 2018 and a 2-for-1 stock split on October 1, 2019. Net assets per share are calculated on theassumption that the stock split was implemented at the beginning of the previous fiscal year.

(3) Consolidated Cash Flows
From operating activities
Cash Flows
JPY mil.
FY12/2019137
FY12/2018
629

From investing activities
Cash Flows
JPY mil.
△203△22

From financing activities
Cash Flows
JPY mil.
△317
649

Cash and cash equivalents
Balance at end of year
JPY mil.
1,733
2,116

2. Dividend Status
Ratio of
Dividend
dividends topayout ratio
net assets
End of first
End of the(Consolidated
Term end
Total(consolidated
quarterthird quarter
)
)
Yen
Yen
Yen
Yen
Yen
%
%
JPY mil.
FY12/2018
0.00
50.00
50.00
142
27.4
10.4
FY12/2019
0.00
23.00
23.00
131
30.5
6.4
FY12/2020 (Forecast)
0.00(NOTE) 1. We plan to pay a dividend for the year ending December 31, 2020, but have not yet determined the year-end dividend forecast.
2. We conducted a 2-for-1 stock split on October 1, 2019. For the year ended December 31, 2018, the actual amount of dividends prior to the stock split isstated. The figures for the fiscal year ended December 31, 2019 reflect the impact of the stock split.
Dividend per share

End ofsecondquarter

Total dividend
amount(Total)Forecasts for the fiscal year ended December 31, 3.2020 (January 1, 2,020 to December 31, 2020)(Percentages indicate year-on-year changes for the full year.)
Attributable to
Per share
Net sales
Operating income
Ordinary income
owners of parent
Net income
Net income
JPY
JPY
JPY
JPY
%
%
%
%
Yen
mil.
mil.
mil.
mil.
Full year
5,300
11.1
800
20.6
800
17.8
557
29.7
97.68
(NOTE) Due to the timing of recording sales of incentive fees in the Financial Advisory Business, the Group's performance fluctuates significantly during the
fiscal year, making it difficult to calculate consolidated earnings forecasts for the second quarter (cumulative) and managing earnings for the fiscal year.
Accordingly, the Group only announces full-year earnings forecasts.

※ Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries accompanied by changes in the scope of
consolidation): None
(2) Changes in accounting policies and changes or restatement of accounting estimates① Changes in accounting policies due to revisions to accounting standards, etc.: None
② ① Changes in accounting policies other than: None
③ Changes in accounting estimates: None
④ Restatement of revisions: None
(3) Number of shares of common stock outstanding① Number of shares issued at the end of theperiod (including treasury stock)② Number of treasury stock at the end of theperiod③ Average number of shares during the period

FY12/2019

5,706,000 Shares

FY12/2019
FY12/2019

4,126

FY12/2018

Shares

FY12/2018

5,701,934 Shares

FY12/2018

5,706,000 Shares
4,000

Shares5,174,953 Shares(NOTE) We conducted a 1000-for-1 stock split on July 13, 2018 and a 2-for-1 stock split on October 1, 2019. The number of outstanding shares at theend of the period (including treasury shares), the number of treasury shares at the end of the period, and the average number of shares during theperiod have been calculated as if this stock split had taken place at the beginning of the previous fiscal year.

(Reference) Summary of Non-consolidated Financial Results
Non-consolidated results for the year ended December 31, 1.2019 (January 1, 2,019 to December 31, 2019)(1) Non-Consolidated Results of Operations(Percentages indicate year-on-year changes.)
Net sales
Operating income
Ordinary income
Net income
JPY mil.
%
JPY mil.
%
JPY mil.
%
JPY mil.
%
△2.1
△0.7
△9.6
FY12/2019
4,762
1.6
656
660
417
FY12/2018
4,690
22.0
670
178.7
665
169.9
461
33.9
Per share
Net income
FY12/2019
FY12/2018

Yen
73.17
89.23

Fully diluted
Net income per share
Yen
71.30
88.56

(NOTE) We conducted a 1000-for-1 stock split on July 13, 2018 and a 2-for-1 stock split on October 1, 2019. Net income per share and diluted net income pershare are calculated as if the stock split had taken place at the beginning of the previous fiscal year.

(2) Non-Consolidated Financial Position
Total assets
JPY mil.
FY12/2019
3,243
FY12/2018
3,610
Reference:
FY12/2019
2,158
Shareholders' equity

Net assets
JPY mil.
2,158
1,883
JPY
mil.

FY12/2018

Equity Ratio
%
66.5
52.2
1,883

Net assets per shareYen
378.55330.40JPY
mil.

(NOTE) We conducted a 1000-for-1 stock split on July 13, 2018 and a 2-for-1 stock split on October 1, 2019. Net assets per share are calculated on theassumption that the stock split was implemented at the beginning of the previous fiscal year.

※ This financial results report is not subject to the audit by a certified public accountant or an auditing firm.
※ Explanations and other special notes concerning the appropriate use of business performance forecasts(Cautionary Statement with Respect to Forward-Looking Statements)
The earnings forecasts and other forward-looking statements herein are based on information currently available to us andcertain assumptions that we believe to be reasonable, and are not intended to guarantee the achievement of the forecasts.
Actual results may differ materially from the forecast depending on a range of factors. Please refer to "1. Overview ofOperating Results, etc., (4) Future Outlook" on page 3 of the attached materials for the assumptions for the forecasts and cautions
regarding the use of the forecasts.

○ Accompanying Materials – Contents
1. Overview of Operating Results, etc. ••2(1) Overview of Operating Results for the Fiscal Year under Review.

2(2) Overview of Financial Position for the Fiscal Year under Review...

2(3) Overview of Cash Flows for the Fiscal Year under Review.

3(4) Future Outlook ....................................................................................................................。

3

2. Basic Approach to Selection of Accounting Standards.......................

4

3. Consolidated Financial Statements and Key Notes.

5(1) Consolidated Balance Sheets .................................................................................................................。

5(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income.

7

Consolidated Statements of Income .................................................................................................................。
Consolidated Statement of Comprehensive
Income ...........................................................................................................。

7(3) Consolidated Statements of Changes in Net Assets ..................................................................................................。

9(4) Consolidated Statements of Cash Flows ............................................................................................。

11(5) Notes fo consolidated financial statements ............................................................................................。

128(Notes on Going Concern)......................

12

Segment Information.

12(Per Share Information)........................

12(Significant Subsequent Events)....

12

-1-

1. Overview of Operating Results, etc.
(1) Overview of Operating Results for the Fiscal Year under Review
The Japanese economy in the current fiscal year (from January 1, 2,019 to December 31, 2019) remained on a gradual recovery
trend against the backdrop of an improvement in the employment and incomes environment and an improvement in corporate
profitability, but the outlook is uncertain due to the effects of uncertainties in the global economy, such as the U.S. andintermediate trade problems and the slowdown in the Chinese economy.
Under such a business environment, our group continued to focus on proposals aimed at resolving corporate issues in an
integrated manner by providing comprehensive services that leverage management consulting, financial advisory, revitalization
support, and other functions. In the third quarter of the fiscal year under review, the Company relocated its head office, which
resulted in the consolidation of offices that had been divided into 3 floors into 1 floor, thereby improving office efficiency. The
Company also worked to improve operational quality by encouraging active communication between employees and promoting
exchanges of different expertise.
As a result of the above, in the Financial Advisory Business, where a large-scale project was concluded in the previous fiscal
year, net sales decreased due to the absence of a similar large-scale project in the fiscal year under review. However, due to anincrease in net sales in the Management Consulting Business and a significant increase in net sales in the Revitalization Support
Business, net sales for the Group amounted to JPY4,771,144 k (up 1.7% from the previous fiscal year). In terms of profits,
operating income was JPY663,240 k (down 1.4% year on year) and ordinary income was JPY678,872 k (up 0.3%). As an
extraordinary loss of JPY43,169 k was recorded for the relocation of the head office, net income attributable to owners of theparent was JPY429,382 k (down 9.1%).
An overview of operating results by business segment is as follows.
<Management Consulting Business>
The business results of the management consulting business for the current consolidated fiscal year were JPY2,016,274 k in net
sales (3.7% increase from the previous consolidated fiscal year). This is because in the previous fiscal year, a portion of thehuman resources of the in-house revitalization support division was allocated to a portion of the management consulting business.
In the fiscal year under review, almost all of this human resources were focused on the revitalization support business, andtherefore personnel resources in the management consulting business declined temporarily. However, this impact was offset by anincrease in the number of employees due to hiring, and sales in the management consulting business increased in the fiscal year
under review due to the lengthening and increasing size of orders.
<Financial Advisory Business>
In the Financial Advisory Business, net sales for the fiscal year under review amounted to JPY2,064,316 k (a decrease of 11.7%
from the previous fiscal year). In the fiscal year under review, net sales decreased compared with the previous fiscal year due to theconclusion of large-scale M&A deals in the previous fiscal year, which is a comparison.
<Revitalization Support Program>
The business results of the Revitalization Support Business for the fiscal year under review were net sales of JPY567,383 k (up111.4% year on year). In the fiscal year under review, the number of consultations from financial institutions concerned with the
purpose of supporting the revitalization of borrowers by financial institutions increased. In addition, due to the effects ofincreased personnel, sales significantly increased compared with the previous fiscal year as a result of significantly capturing theincrease in needs.
<Other Business>
The results of the Other Business for the fiscal year under review were net sales of JPY123,169 k (a decrease of 12.1% fromthe previous fiscal year).
(2) Overview of Financial Position for the Fiscal Year under Review(Assets)
Total assets at the end of the fiscal year under review were JPY3,269,111 k (compared with JPY3,623,692 k at the end of theprevious fiscal year), a decrease of JPY354,580 k from the end of the previous fiscal year. Current assets were JPY2,585,177 k(JPY3,122,228 k at the end of the previous fiscal year) and non-current assets were JPY683,933 k (JPY501,463 k at the end of
the previous fiscal year). Current assets decreased by JPY537,050 k and non-current assets increased by JPY182,469 k-2-compared to the end of the previous fiscal year. The main changes in current assets were a decrease of JPY383,218 k in cash
and deposits and a decrease of JPY180,870 k in accounts receivable-trade. The main changes in non-current assets were an
increase of JPY210,536 k in buildings and a decrease of JPY72,369 k in deferred tax assets.

-3-

(Liabilities)
Total liabilities at the end of the fiscal year under review were JPY1,083,769 k (compared with JPY1,726,161 k at the end of
the previous fiscal year), a decrease of JPY642,391 k from the end of the previous fiscal year. Current liabilities were
JPY1,001,516 k (compared with JPY1,722,672 k at the end of the previous fiscal year) and non-current liabilities were
JPY82,253 k (compared with JPY3,488 k at the end of the previous fiscal year). Current liabilities decreased by JPY721,156 k
and non-current liabilities increased by JPY78,764 k compared with the end of the previous fiscal year. The main changes incurrent liabilities were a decrease of JPY147,995 k in accounts payable-trade, a decrease of JPY175,003 k in short-term loans
payable, a decrease of JPY130,338 k in provision for bonuses, a decrease of JPY96,408 k in provision for directors' bonuses,
and a decrease of JPY120,321 k in income taxes payable. The change in non-current liabilities is an increase of JPY78,764 k in
asset retirement obligations.
(Net Assets)
Net assets at the end of the fiscal year under review were JPY2,185,341 k (compared with JPY1,897,531 k at the end of theprevious fiscal year), an increase of JPY287,810 k from the end of the previous fiscal year. This was mainly due to an increase
in retained earnings resulting from the recording of profit attributable to owners of parent of JPY429,382 k and dividends of
JPY142,550 k from retained earnings.
(3) Overview of Cash Flows for the Fiscal Year under Review
Cash and cash equivalents (hereinafter referred to as "funds") at the end of the fiscal year under review decreased by
JPY383,218 k from the end of the previous fiscal year to JPY1,733,235 k.
The status of cash flows and their factors for the current consolidated fiscal year are as follows.
Cash flows from operating activities
Net cash provided by operating activities was JPY137,641 k (net cash provided by operating activities was JPY629,176 k inthe previous fiscal year). This was mainly due to the recording of profit before income taxes of JPY635,703 k, a decrease in notes
and accounts receivable-trade of JPY180,824 k, and a decrease in provision for bonuses of JPY130,325 k, a decrease in provision
for directors' bonuses of JPY96,408 k, a decrease in notes and accounts payable-trade of JPY147,993 k, and income taxes paid of
JPY257,551 k.
Cash flows from investing activities
Net cash used in investing activities was JPY203,350 k (net cash used of JPY22,045 k in the previous fiscal year). This was
mainly due to purchase of property, plant and equipment of JPY180,224 k.
Cash flows from financing avtivities
Net cash used in financing activities was JPY317,748 k (compared with JPY649,168 k provided in the previous fiscal year).
This was mainly due to a decrease in short-term loans payable of JPY175,003 k and dividend payments of JPY142,550 k.
(4) Future Outlook
Our sales plan is calculated by adding together sales prepared by division. Net sales for each division are calculated bymultiplying the number of personnel in the division after calculating net sales per person, taking into account past performance,
characteristics of the division concerned, individual circumstances, etc.
Projects that can be estimated at the time the plan is formulated are accumulated and reflected in the plan individually.
In addition, in order to create optimal teams for customers when executing projects, we often team up across divisions. As aresult, 1 division does not necessarily conduct only 1 business (management consulting, financial advisory, revitalization support,
and other businesses), but also conducts multiple businesses in 1 division. At the time of formulating the plan, it is difficult foreach division to forecast net sales by business, and no forecast by business is made for the entire company. Therefore, we do notdisclose the forecast by business.
Although the profitability of Japanese companies as a whole is improving, improving growth potential by developing new
demand, including overseas markets, is becoming a common management issue for Japanese companies in response to thedecline in demand caused by the shrinking population due to the declining birthrate and aging population in Japan.
In the Management Consulting Business, we aim to expand our business by formulating M&A strategies, and responding to
growing needs for SCMs (Supply Chain Management: management methods for integrating the flow of industries from suppliers
to final consumers and realizing process-wide streamlining and optimization), support for sales reforms, resident support-4-

consulting, and management dispatch services.
In addition, we will support the promotion of outsourcing (Business Process Outsourcing), which is increasingly needed bycustomers, and the promotion of business efficiencies using artificial intelligence (Artificial Intelligence) and robotic automation(Robotic Process Automation).
In addition, crisis management and forensics experts will start offering a new set of solutions, ranging from fraud
investigations and crisis management publicity, to the formulation of measures to prevent recurrence and support for
implementation, from responding appropriately in the event of a crisis to recovering and improving corporate value by building
governance.
In the Financial Advisory Business, the number of M&A transactions in Japan has consistently increased since 2011, and the
M&A market is expected to remain brisk due to industry reorganization to respond to market changes, the sale of non-corebusinesses and sluggish businesses to improve earnings, an increase in cross-border M&A to develop overseas markets, and anincrease in business succession-type M&A associated with the aging of domestic managers of small and medium-sizedcompanies. As a result, we will aim to steadily expand our business. In particular, for cross-border M&A to cultivate overseas
markets, we have become a full member of CFI (Corporate Finance International: an M&A firm that operates in more than 20
countries around the world, mainly in Europe), and have become more accessible to information on trading candidates foroverseas companies than in the past, thereby strengthening our cross-border M&A functions.
In the revitalization support business, against the backdrop of signs of an increase in bankruptcies from the second half of lastyear and the conversion of lending criteria by financial institutions to borrowers, the number of consultations from such financial
institutions aimed at supporting the revitalization of borrowers by financial institutions is increasing, and we will aim to expand
our business by reliably responding to revitalization needs.
In addition, we are strengthening our structure for PMI (Integrated Process after M&A) (Post Merger Integration), which
requires knowledge of both the Management Consulting Business and the Financial Advisory Business.
In addition, we have realized consolidation from 3 floors to 1 floor through the relocation of our headquarters in FY2019, so
we will aim to improve operational quality and improve productivity by improving office efficiency and promoting exchanges ofdifferent expertise between employees.
Based on the above, the forecasts for the next fiscal year are for net sales of JPY5.3 bn (up 11.1% from the current fiscal year),
operating income of JPY0.8 bn (up 20.6%), ordinary income of JPY0.8 bn (up 17.8%), and profit attributable to owners of parentof JPY557 mn (up 29.7%).

-5-

2. Basic Concept Regarding Selection of Accounting Standards
The Group prepares its consolidated financial statements in accordance with Japanese GAAP, considering the comparability ofconsolidated financial statements between periods and between companies. In addition, with regard to the application ofInternational Accounting Standards, we will take appropriate measures in consideration of various conditions in Japan andoverseas.

3. Consolidated Financial Statements and Major Notes(1) Consolidated Balance Sheets(Thousands of yen)
End of previous fiscal year
(As of December 31, 2018)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable
Operational investment securities
OthersAllowance for doubtful accounts
Total current assets
Fixed assets
Property, plant and equipment
Buildings, net
Tools, furniture, and fixtures, net
Total property, plant and equipment
Intangible assets
Software
OthersTotal intangible assets
Investments and other assets
Stocks of subsidiaries and affiliates
Lease deposits
Deferred tax assets
OthersTotal investments and other assets
Total noncurrent assets
Total assets-6-

Current Consolidated Fiscal Year(As of December 31, 2019)

2,116,453
876,10356,14488,224△14,697
3,122,228

1,733,235
695,233
56,394113,966△13,651
2,585,177

8,140
11,512
19,653

218,677
28,326
247,003

8,578
102
8,680

14,640102
14,742

16,491
198,580
247,279
10,778473,129
501,463
3,623,692

29,871
211,086
174,9106,318
422,187
683,933
3,269,111

(Thousands of yen)
End of previous fiscal year
(As of December 31, 2018)
Liabilities
Current liabilities
Accounts payable
Short-term borrowings
Accounts payable-other
Income taxes payable
Provision for bonuses
Provision for directors' bonuses
OthersTotal current liabilities
Long-term liabilities
Asset retirement obligations
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders' equity
Paid-in Capital
Capital surplus
Retained earnings
Treasury stock
Total shareholders' equity
Other accumulated comprehensive income
Foreign currency translation adjustment
Total other accumulated comprehensive income
Total net assets
Total liabilities and net assets-7-

Current Consolidated Fiscal Year(As of December 31, 2019)

166,626
175,003
119,350
278,657
641,886
121,506
219,642
1,722,672

18,631
92,783
158,336
511,547
25,098
195,120
1,001,516

3,488
3,488
1,726,161

82,25382,253
1,083,769

158,137
808,967
919,822△418
1,886,509

158,137
808,967
1,206,655△613
2,173,146

11,021
11,021
1,897,531
3,623,692

12,194
12,1942,185,341
3,269,111

(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income(Consolidated Profit and Loss Statement)

4,690,065
1,800,026
2,890,038(Thousands of yen)
Current Consolidated Fiscal
Year(January 1, 2019
From December 31, 2019)
4,771,144
1,795,483
2,975,660

760,286
320,842
121,506
15,384
2,844
996,706
2,217,571
672,467

888,717
253,878
25,09817,496
1,127,230
2,312,420
663,240

40
13,491
1,259
2,424
39
17,25555
13,380
1,158
9,927
2,354
1,352
28,227

1,502
8,094
3,510
13,107
676,615

727
9,110
2,757
12,595
678,872

40,46940,469-717,085
295,053△50,402244,650
472,434
472,434

43,16943,169635,703
133,951
72,369206,320429,382
429,382

End of previous fiscal year
(January 1, 2018
To December 31, 2018)
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Salaries and allowances
Provision for bonuses
Provision for directors' bonuses
Retirement benefit expenses
Provision for allowance for doubtful accounts
OthersTotal selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Equity in earnings of affiliates
Insurance dividend income
Income from insurance claim
Administrative fees received
OthersTotal non-operating income
Non-operating expenses
Interest expenses
IPO related expense
Expenses for information security
Foreign exchange losses
Total non-operating expenses
Ordinary income
Extraordinary gains
Gain on reversal of asset retirement obligations
Total extraordinary income
Extraordinary losses
Expenses for relocation of head officeTotal extraordinary loss
Income before income taxes
Income taxes
Income taxes-deferred
Total income taxes
Net income
Profit attributable to owners of parent-8-

Consolidated Statements of Comprehensive Income

472,434(Thousands of yen)
Current Consolidated Fiscal
Year(January 1, 2019
From December 31, 2019)
429,382

2,857
2,857
475,292

1,173
1,173
430,556475,292

430,556--

End of previous fiscal year
(January 1, 2018
To December 31, 2018)
Net income
Other comprehensive income
Foreign currency translation adjustment
Total other comprehensive income
Comprehensive income(Comprehensive income attributable to)Comprehensive profit attributable to owners of theparentComprehensive income attributable to non-controllinginterests-9-(3) Consolidated Statements of Changes in Net Assets
Previous fiscal year (January 1, 2018, to December 31, 2018)(Thousands of yen)
Shareholders' equity
Paid-in Capital
Opening balance

Capital surplus

158,137

158,137

Retained earnings
490,690

Change during the year

Treasury stock△73,150△43,301

Dividend of surplus
Profit attributable to owners of parent
650,829

733,815△43,301

472,434

Disposal of treasury stock

Total shareholders'equity472,434

72,732

723,561

Net changes of items other thanshareholders' equity(Net)
Total changes in current term
Closing balance-

650,829

429,132

72,732

1,152,694

158,137

808,967

919,822△418

1,886,509

Other accumulated comprehensive income

Opening balance

Foreign currencytranslation
adjustment

Total
other
accumulatedcomprehensive
income

8,163

8,163

Total net assets

741,979

Change during the year

Profit attributable to owners of parent△43,301

Disposal of treasury stock

723,561

Dividend of surplus

Net changes of items other thanshareholders' equity(Net)472,434

2,857

2,857

2,857

Total changes in current term

2,857

2,857

1,155,551

Closing balance

11,021

11,021

1,897,531- 10 -

Current fiscal year (from January 1, 2,019 to December 31, 2019)(Thousands of yen)
Shareholders' equity
Paid-in Capital
Opening balance

Capital surplus

158,137

Retained earnings

808,967

919,822

Change during the year

Profit attributable to owners of parent

Net changes of items other thanshareholders' equity(Net)
Total changes in current term--

286,832

158,137

808,967

1,206,655

Other accumulated comprehensive income
Foreign currencytranslation
adjustment

Total
other
accumulatedcomprehensive
income11,021

11,021

Total net assets

1,897,531

Change during the year
△142,550

Dividend of surplus
Profit attributable to owners of parent

429,382

Purchase of treasury stock
Net changes of items other thanshareholders' equity
(Net)

△195

1,173

1,173

Total changes in current term

1,173

1,173

287,810

Closing balance

12,194

12,1942,185,341- 11 -

1,173

Total shareholders'equity1,886,509△142,550

429,382

Purchase of treasury stock

Opening balance△418△142,550

Dividend of surplus

Closing balance

Treasury stock

429,382

△195

△195

△195

286,637△613

2,173,146

(4) Consolidated Statements of Cash Flows(Thousands of yen)
Current Consolidated Fiscal
Year(January 1, 2019
From December 31, 2019)

End of previous fiscal year
(January 1, 2018
To December 31, 2018)
Net cash provided by (used in) operating activities
Income before income taxes
Depreciation and amortization
Share of profit (loss) of entities accounted for using
equity method (△: profit)
Increase (decrease) in accrued bonuses
Increase (decrease) in provision for directors' bonuses(△)
Increase (decrease) in allowance for doubtful accounts(△)
Interest income
Interest expenses
Gain on reversal of asset retirement obligations
Decrease (△) in notes and accounts receivable-trade
Decrease (△) in operational investment securities
Increase (△) in notes and accounts payable-trade
Increase (decrease) in accounts payable-other (△)
OthersSubtotalInterest received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flow from investing activities
Purchase of property, plant and equipment
Purchase of intangible assets
Payments for lease and guarantee deposits
Proceeds from collection of lease and guarantee
deposits
Cash flow from investing activities
Cash flow from financing activities
Net increase (△) in short-term borrowings
Proceeds from sales of treasury stock
Purchase of treasury stock
Cash dividends paid
OthersCash flow from financing activities
Effect of exchange rate change on cash and cash
equivalents
NET (DECREASE) INCREASE IN CASH AND CASH
EQUIVALENTS
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of term

717,085
22,005635,703
33,628△13,491△13,380

63,506△130,325△17,854△1,045

186,854△40
1,502△40,469△243,236△55,953
50,42130,856
31,105732,29040△1,446△101,707
629,176△55
727
180,824△250△147,993△23,379△42,201
395,84455△707△257,551
137,641△3,057△4,895△14,092-△180,224△10,602△13,772△22,045△203,350

△716

239

△24,997
723,561△43,301△6,094649,168

1,255,583
860,870
2,116,453- 12 -△96,408

1,248△175,003△195△142,550△317,748△383,218

2,116,453
1,733,235

(5) Notes fo consolidated financial statements(Notes on the Going Concern Assumption)
Not applicable.
(Segment Information)
Disclosure is omitted because the business segments of the Group are a single segment.
(Per Share Information)
End of previous fiscal year
(January 1, 2018
To December 31, 2018)

Current Consolidated Fiscal Year
(January 1, 2019
From December 31, 2019)

Net assets per share

JPY332.78

JPY383.26

Net income per share

JPY91.29

JPY75.30

Diluted net income per share

JPY90.61

JPY73.37(NOTE) 1. Since we were listed on the Mothers market of the Tokyo Stock Exchange on September 28, 2018, diluted net income
per share for the previous fiscal year is calculated by considering the average stock price from the date of the newlisting to the end of the previous fiscal year as the average stock price during the period.
2. We conducted a 1000-for-1 stock split on July 13, 2018, and a 2-for-1 stock split on October 1, 2019. Net assets per share,
net income per share and diluted net income per share are calculated as if this stock split had taken place at the
beginning of the previous fiscal year.
3. The basis for calculating net income per share and diluted net income per share is as follows:
End of previous fiscal year
Current Consolidated Fiscal Year
(January 1, 2018
(January 1, 2019
To December 31, 2018)
From December 31, 2019)
Net income per share
Profit attributable to owners of parent(Thousands of yen)Amount not attributable to common stock (JPY1 k)
Profit attributable to owners of parent attributable tocommon stock (JPY1 k)
Average number of shares of common stock
outstanding during the period (shares)
Diluted net income per share
Adjustment of profit attributable to owners ofparent(Thousands of yen)
Increase in common stock (shares)(Stock acquisition rights (shares))
Explanation of residual stock not included in
calculation of diluted net income per share due to lackof dilutive potential

472,434

429,382--

472,434

429,382

5,174,953

5,701,934--

38,938(38,938)-

149,581(149,581)-(Significant Subsequent Events)(Purchase of treasury stock)
At the meeting of the Board of Directors held on February 13, 2020, we resolved to repurchase treasury stock in accordancewith the provisions of Article 156 of the Companies Act as applied by replacing certain terms pursuant to the provisions ofParagraph 3 of Article 165 of the same Act and to acquire such treasury stock in a specific manner.
1. Reason for Conducting the Share Repurchase
The Company will repurchase its own shares in order to improve capital efficiency and implement flexible capital
policies in response to changes in the business environment, as well as to increase value per share as a shareholder return
policy.
2. Details of Acquisition(1) Class of Shares to be Acquired Our Common Stock(2) Total number of shares to be acquired: 57 k shares (maximum)(3) Total purchase price of shares JPY111,720 k (maximum)- 13 -

(4) Acquisition period February 14, 2020
(5) Method of repurchase: Off-auction purchase of treasury shares on the Tokyo Stock Exchange (ToSTNet-3)- 14 -