Consolidated Financial Results for the Third Quarter of the Fiscal Year Ending December 31, 2020
[Japanese GAAP]
Listed company name
Code number
Representative
Contact

Frontier Management Inc.
7038
URL https://www.frontier-mgmt.com/(Title)Representative Director(Name) Shoichiro Onishi(Title)Executive Officer,(Name) Junko Koshino
Head of Corporate
Strategy Department
Scheduled date to file Quarterly
November 12, 2020
Scheduled date of
Securities Reportcommencement ofdividend payment
Preparation of supplementary material onquarterly financial results: Yes
Quarterly results briefing: Yes

November 12, 2020
Listed Exchange Tokyo

TEL 03-6862-8335(Millions of yen are rounded down)
Third Quarter of the Year Ending December 31, 2020 (January 1, 2020-September 30, 2020)(1) Consolidated Operating Results (Cumulative)(Percentages indicate year-on-year changes.)
Net sales

Third Quarter of FY2020
Third Quarter of FY2019(NOTE)
Comprehensive
income

JPY mil.
3,495
3,145

Third Quarter of
FY202071

Operating income

%
11.1
△10.9

JPY mil.
116
133

JPY
mil.

(84.9%)Net profit per share

%
△12.8
△77.1

JPY mil.
109
143

%
△23.7
△75.4

JPY mil.
71
36

Third Quarter of
FY2019

38

JPY
mil.

%
96.6
△90.1
(△89.5%)

Fully diluted net profit per share

Yen
12.55
6.36

Third Quarter of FY2020
Third Quarter of FY2019

Profit attributable to owners ofparent Net profit

Ordinary income

Yen
12.25
6.20

(NOTE) We conducted a 2-for-1 stock split on October 1, 2019. Calculations of "Quarterly net income per share" and "Diluted net income per share" are basedon the assumption that the stock split was implemented at the beginning of the previous fiscal year.

(2) Consolidated Financial Position
Total assets
JPY mil.
3,012
3,269

Third Quarter of FY2020
End of FY2019
Reference: Shareholders'equityNet assets

Third Quarter of FY2020

2,097

Equity Ratio
JPY mil.
2,097
2,185

JPY
mil.

End of
FY2019

%
69.6
66.8
2,185

JPY
mil.

2. Dividend Status

End of FY2019
End of FY2020
End of FY2020 (Forecast)End of firstquarterYen-

End of second
quarter
Yen
0.00
0.00

Dividend per share
End of the third
quarter
Yen-

Term end

Total

Yen
23.00

Yen
23.00
-

(NOTE) Revisions to the most recently announced dividend forecasts: None
We plan to pay a dividend for the year ended December 31, 2020, but we have not yet determined the expected amount of dividend.

-Forecasts for the fiscal year ended December 31, 3.2020 (January 1, 2,020 to December 31, 2020)(Percentages indicate year-on-year changes.)
Net sales

Full year

JPY
mil.
5,300

Operating income

%
11.1

JPY
mil.
800

%
20.6

Ordinary income

JPY
mil.
800

Attributable to owners of
Net income per shareparent company

%
17.8

JPY
mil.
557

%

Yen

29.7

97.68

(NOTE) Revisions to the most recently announced earnings forecasts: None

※ Notes(1) Changes in significant subsidiaries during this quarter (changes in specified subsidiaries accompanied by changes in the scope of
consolidation): None
(2) Adoption of special accounting methods for preparing quarterly consolidated financial statements: None
(3) Changes in accounting policies and changes or restatement of accounting estimates① Changes in accounting policies due to revisions to accounting standards, etc.: None
② Changes in accounting policies other than ①: None
③ Changes in accounting estimates: None
④ Restatement of revisions: None
(4) 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 theperiod (cumulative)

Third Quarter of
FY2020Third Quarter of
FY2020Third Quarter of
FY20205,756,880

SharesEnd of FY2019

5,706,000

Shares

31,502

SharesEnd of FY2019

4,126

Shares5,687,158

Shares5,701,954

SharesThird Quarter of
FY2019(NOTE) We conducted a 2-for-1 stock split on October 1, 2019. The number of outstanding shares at the end of the period (including treasury shares)
and the number of treasury shares at the end of the period and the average number of shares during the period (cumulative quarterly period) arecalculated as if this stock split had taken place at the beginning of the previous fiscal year.

※ Quarterly financial results are not subject to quarterly review by certified public accountants or auditing firms.
※ 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. Qualitative
Information on This Quarterly Financial Results, (3) Explanation of Consolidated Earnings Forecasts and Other Forward-Looking
Statement" on page 3 of the attached material for the assumptions underlying the forecasts and notes on the use of the forecasts.

○ Accompanying Materials – Contents
1. Qualitative Information on This Quarterly Financial Results

2(1) Explanations of Operation Results.......................................................................................................................................

2(2) Explanation of Financial Position …..................................................................................................................................

2(3) Explanation of Consolidated Earnings Forecasts and Other Forward-Looking Statements................................................

3

2. Quarterly Consolidated Financial Statements..........................................................................................................................

4(1) Quarterly Consolidated Balance Sheets .............................................................................................................................

4(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive Income. ......

6

Consolidated income statement for the quarter
3rd Quarter. .............................................................................................................................................................

6

Quarterly Consolidated Statements of Comprehensive Income
3rd Quarter. .............................................................................................................................................................

7(3) Notes to Quarterly Consolidated Financial Statements. ....................................................................................................

8(Notes on Going Concern) ...............................................................................................................................................

8(Notes in the Event of Significant Changes in Shareholders' Equity). ............................................................................

8(Additional Information) .................................................................................................................................................

8(Segment Information)......................................................................................................................................................

8(Significant Subsequent Events). .....................................................................................................................................

8

1. Qualitative Information on This Quarterly Financial Results(1) Explanations of Operation Results
The outlook for the Japanese economy during the first three quarters of the current fiscal year (January 1, 2,020 to September
30, 2020) is extremely uncertain because economic activities have been stagnant due to the impact of restricted travel andvoluntary restraints resulting from the expansion of the new coronaviral disease (COVID-19) amid sluggish consumer spending
and a decline in corporate capital spending following the consumption tax hike, and the outlook for the future remains unclear.
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.
As a result of the above, our Group's results for the third quarter of the fiscal year under review were as follows. Althoughrevenues in the Financial Advisory Business decreased compared with the same period of the previous fiscal year due to theimpact of the COVID-19, revenues in the Management Consulting Business increased and revenues in the Revitalization
Support Business increased significantly. As a result, net sales in the Financial Advisory Business were JPY3,495 million (up11.1% compared with the same period of the previous fiscal year). In terms of expenses, recruitment and personnel expenses
increased as a result of aggressive recruitment of personnel in preparation for management consulting needs and revitalization
support needs, which are expected to increase further in the future, far exceeding initial plans. As a result, operating income
was JPY116 million (down 12.8% year on year), and as a result of the recording of JPY17 million in non-operating expenses
for the transfer to the First Section of the Tokyo Stock Exchange, ordinary income was JPY109 million (down 23.7%). Profit
attributable to owners of parent for the quarter was JPY71 million (up 96.6% year on year) due to the absence of the impact of
JPY43 million in expenses related to the relocation of the head office, which had been recorded as an extraordinary loss in theprevious fiscal year.
Operating results by business are as follows.
<Management Consulting Business>
The business results of the Management Consulting Business for the first three quarters of the current fiscal year were net
sales of JPY1,701 million (an increase of 12.5% from the same quarter of the previous fiscal year). In the third quarter of thecurrent fiscal year, net sales increased compared with the same period of the previous fiscal year as a result of the expansion of
the scope of operations for which the same customer consults and the increasing size of projects.
<Financial Advisory Business>
The financial advisory business posted net sales of JPY1,020 million for the first three quarters of the current fiscal year
(15.3% decrease from the same period of the previous fiscal year). In the third quarter of the fiscal year under review, sales
decreased compared with the same period of the previous fiscal year due to factors such as the disruption of cross-border M&A
deals between domestic companies and overseas companies and delays in advancing due to constraints on physical movement
abroad caused by the impact of the COVID-19.
<Revitalization Support Program>
The business results of the Revitalization Support Business for the first three quarters of the fiscal year under review were
net sales of JPY730 million (up 114.0% from the same quarter of the previous fiscal year). In the third quarter of the fiscal year
under review, net sales increased significantly compared with the same period of the previous fiscal year due to the continued
strong number of referral projects from financial institutions from the previous fiscal year and the execution of multiple largescale projects.
<Other Business>
The results of the Other Business for the third quarter of the current fiscal year were net sales of JPY42 million (a decreaseof 51.0% from the same quarter of the previous fiscal year).
(2) Explanation of Financial Position<Assets>
The Group's assets at the end of the third quarter of the current fiscal year were JPY3,012 million (compared with JPY3,269
million at the end of the previous fiscal year), a decrease of JPY256 million from the end of the previous fiscal year.

2This was mainly due to an increase of JPY56 million in investment securities, a decrease of JPY181 million in notes andaccounts receivable-trade, and a decrease of JPY151 million in cash and deposits.
<Liabilities>
The Group's balance of liabilities at the end of the third quarter of the current fiscal year was JPY915 million (compared to
JPY1,083 million at the end of the previous fiscal year), a decrease of JPY168 million from the end of the previous fiscal year.
This was mainly due to increases of JPY49 million in other current liabilities and JPY34 million in accounts payable-other,and decreases of JPY148 million in income taxes payable and JPY124 million in provision for bonuses.
<Net assets>
The Group's net assets at the end of the third quarter of the current fiscal year were JPY2,097 million (compared with
JPY2,185 million at the end of the previous fiscal year), a decrease of JPY88 million from the end of the previous fiscal year.
This was mainly due to the recording of profit attributable to owners of parent of JPY71 million for the third quarter of thecurrent fiscal year and the disposal of treasury stock of JPY75 million as restricted stock compensation (a decrease of JPY54
million in treasury stock and an increase of JPY20 million in capital surplus), which increased. On the other hand, there was adecrease in retained earnings due to dividends of JPY131 million and the acquisition of treasury stock of JPY111 million.
(3) Explanation of Consolidated Earnings Forecasts and Other Forward-Looking Information
There is no change in the full-year consolidated earnings forecast from the consolidated earnings forecast announced on
February 13, 2020.
The Financial Advisory Business posted a challenging performance in the third quarter, continuing from the second quarter,
due to factors such as the disruption of cross-border M&A deals between domestic companies and overseas companies anddelays in advancing due to constraints on physical migration abroad caused by the impact of the COVID-19. In addition, we
achieved our initial target of having 200 employees at the end of the fiscal year, significantly exceeding the target of having
223 employees at the end of September ahead of schedule. In the third quarter, we were able to invest in more than planned
personnel, despite the heavy burden of personnel expenses and recruitment expenses recorded ahead of schedule. We willcontinue to actively invest in this area, with the expectation that it will serve as a foundation for growth from the next fiscal
year onward.
In the fourth quarter, we anticipate continued strong performance due to continued strong demand in the management
consulting business and the revitalization support business, as well as the effects of personnel expansion. In the financial
advisory business, we anticipate multiple M&A deals, for which progress had been delayed since the second and third quarters.
As in FY2019, we expect contract conclusions to be concentrated in the fourth quarter.
Furthermore, in the Financial Advisory Business, the number of consultations on carve-out projects (selling companies' noncore businesses and non-core subsidiaries to other companies) is currently increasing, and the number of projects that are
expected to be concluded in the next fiscal year is increasing.
With regard to the status of the COVID-19, we assume that the current status will continue at least within the fiscal year.
After factoring in the impact of these conditions, we believe that our earnings forecasts will be broadly in line with theconsolidated earnings forecasts announced on February 13, 2020 due to the foregoing expectations. In the event that it becomes
necessary to revise the earnings forecast in the future, the Company plans to promptly disclose the information.
With the relocation of the head office in the previous fiscal year, we have enhanced the IT environment and security, thereby
creating an environment in which operations can be fully executed in remote work. The balance between business execution
and remote work in our offices is adjusted while closely monitoring the spread of the COVID-19. In any event, the impact on
our business execution system is minimal even when there are restrictions on going out.

3

2. Quarterly Consolidated Financial Statements(1) Quarterly Consolidated Balance Sheets
Previous fiscal year
(As of Dec 31, 2019)
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
Investment securities
Stocks of subsidiaries and affiliates
Lease deposits
Deferred tax assets
OthersTotal investments and other assets
Total noncurrent assets
Total assets

4(Thousands of yen)
End of current consolidated
third quarter(As of Sep 30, 2020)

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

1,581,813
513,766
55,437150,976△11,385
2,290,608

218,677
28,326
247,003

200,525
21,751
222,277

14,640102
14,742

11,596102
11,69829,871
211,086
174,9106,318
422,187
683,933
3,269,111

56,80035,787211,113
137,486
46,629487,817
721,792
3,012,400

Previous fiscal year
(As of Dec. 31, 2019)
Liabilities
Current liabilities
Accounts payable
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

5(Thousands of yen)
End of current consolidated
third quarter(As of Sep 30, 2020)

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

48,966
127,0369,550
387,300
15,056
245,099
833,00982,25382,253
1,083,769

82,25682,256915,266

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

161,953
833,644
1,146,905△57,932
2,084,570

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

12,563
12,563
2,097,134
3,012,400

(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive Income
Quarterly Consolidated Statements of Income(Third Quarter Consolidated Cumulative Period)(Thousands of yen)
Accumulated period forAccumulated period for current
previous consolidated third
consolidated third quarter
quarter(Jan 1, 2020 to Sep 30, 2020)(Jan 1, 2019 to Sep 30, 2019)
Net sales
3,145,889
3,495,604
Cost of sales
1,310,236
1,466,300
Gross profit
1,835,652
2,029,303
Selling, general and administrative expenses
1,702,059
1,912,777
Operating income
133,592
116,526
Non-operating income
Interest income
43
57
Equity in earnings of affiliates
8,281
5,915
Insurance dividend income
1,158
968
Income from insurance claim
7,727
72
Reversal of allowance for doubtful accounts
3,678
2,266
Others
2,004
3,677
Total non-operating income
22,893
12,958Non-operating expenses
Interest expenses
727
667
Market change costs
17,376
Expenses for information security
7,010
Foreign exchange losses
4,859
1,361
Others256
Total non-operating expenses
12,597
19,661
Ordinary income
143,889
109,823
Extraordinary losses
Expenses for relocation of head office
43,169Total extraordinary loss
43,169Current net income for the quarter before income taxes
100,719
109,823and minority interests
Income taxes
1,048
1,006
Income taxes-deferred
63,35737,423
Total income taxes
64,40538,430Net profit
36,314
71,393
Net profit attributable to owners of parent
36,314
71,393

6

Quarterly Consolidated Statements of Comprehensive Income(Third Quarter Consolidated Cumulative Period)

Net profit
Other comprehensive income
Foreign currency translation adjustment
Total other comprehensive income
Quarterly comprehensive income(Comprehensive income attributable to)
Quarterly comprehensive income attributable toowners of the parent
Quarterly comprehensive income attributable to noncontrolling interests(Thousands of yen)
Accumulated period forAccumulated period for current
previous consolidated third
consolidated third quarter
quarter(Jan 1, 2020 to Sep 30, 2020)(Jan 1, 2019 to Sep 30, 2019)
36,314
71,393

7

2,499
2,499
38,813368
368
71,761

38,813

71,761--

(3) Notes to Quarterly Consolidated Financial Statements(Notes on the Going Concern Assumption)
Not applicable.
(Notes on Substantial Changes in the Amount of Shareholders' Equity)
Not applicable.
(Additional Information)(Accounting Estimate of the Impact of the COVID-19)
With respect to the status of the COVID-19, the Company makes accounting estimates, such as the recoverability ofdeferred tax assets, based on currently available information, assuming that current conditions will continue at least within
the fiscal year.
As a consequence, we are not aware of any material impact on the valuation of our accounting estimates; however, due tothe highly uncertain impact of the spread of the COVID-19, our financial condition and results of operations may be
impacted depending on the future.
(Segment information, etc.)[Segment Information]
I. Previous Third Quarter Consolidated Cumulative Period (from January 1, 2,019 to September 30, 2019)
Disclosure is omitted because the business segments of the Group are a single segment.
II Current Third Quarter Consolidated Cumulative Period (From January 1, 2,020 to September 30, 2020)
Disclosure is omitted because the business segments of the Group are a single segment.
(Significant Subsequent Events)(Stock Splits and Partial Amendment to the Articles of Incorporation)
Company resolved at the meeting of the Board of Directors held on November 12, 2020, the stock split and partial
amendment to the articles of incorporation.
1. Purpose of the stock split
Company aims to reduce the investment unit price for the Company’s stock, increase the liquidity of the stocks, andexpand our investor base by implementing the stock split.
2. Outline of stock split(1) Method
On Thursday, December 31, 2020 as a record date (a holiday for the shareholder registry administrator, effectively
on Wednesday, December 30, 2020), the Company will split the shares owned by shareholders recorded in the final
shareholder registry two-for-one.
(2) Increase in number of shares due to stock split
Number of shares issued before the stock split:
5,756,880 shares
Increased number of shares upon the split:
5,756,880 shares
Total number of shares issued after the stock split:
11,513,760 shares
Total number of shares issuable after the stock split:
45,648,000 shares(NOTE) Total number of issued shares described above may increase by the record date of the stock split upon theexercise of stock acquisition rights.
(3) Schedule of the split
Announcement of record date
Record date
Effective Date

December 14, 2020
December 31, 2020
January 1, 20218

(4) Effect on per share information
Per share data assuming the stock split had taken place at the beginning of the previous fiscal year is as follows:
Accumulated period for current
Accumulated period for previous
consolidated third quarter
consolidated third quarter(Jan 1, 2019 to Sep 30, 2019)(Jan 1, 2020 to Sep 30, 2020)
Quarterly net income per share

JPY3.18

JPY6.27

Fully diluted
Quarterly net income per share

JPY3.10

JPY6.12

3. Partial Amendment to Articles of Incorporation upon Stock Split(1) Reason for amendment of the articles of incorporation
In accordance with this stock split, the Company will amend as of January 1, 2021, the total number of sharesissuable set by Article 5 in the Articles of Incorporation of the Company by a resolution of the Board of Directors
pursuant to the Article 184.2 of the Companies Act of Japan.
(2) Amendments to the Articles of Incorporation
Details of the changes are as follows.
(Underlined area indicates change)
Current Articles of Incorporation

Amended articles of incorporation(Total Number of Shares Issuable)
Article 5 The total number of shares issuable of theCompany shall be 22,824,000 shares.

(Total Number of Shares Issuable)
Article 5 The total number of shares issuable of theCompany shall be 45,648,000 shares.

(3) Schedule of Amendment to Articles of Incorporation
Effective Date
January 1, 2021
4. Others(1) Change in the Amount of Stated Capital
There is no change in the amount of capital stock at this stock split.
(2) Adjustment of exercise price of stock acquisition rights
In accordance with this stock split, the exercise price per share of the stock acquisition rights to be exercised on orafter January 1, 2021 shall be adjusted:
Date of resolution of theBoard of Directors
Stock acquisition rightMay 15, 2018

Exercise price before theadjustment
JPY1509

Exercise price after the
adjustment
JPY75