Disclaimer: This is a Japanese-English translation of the summary of financial statements of the Company produced for your convenience.
Since no auditor audited this report, officially only the Japanese version is assumed to be the summary of financial statements of the Company.
This summary does not constitute any guarantee and will not compensate any losses and/or damage stemming from actions taken based on thesestatements. In the case that there is any discrepancy between the Japanese and English versions, the Japanese version is assumed to be correct.

Consolidated Financial Report
For the First Quarter of Fiscal 2019 Ending March 31, 2019 (Japanese GAAP)
Company Name:Grandy House Corporation
Stock Exchange Listing:
Securities Code:
8999
URL:
Representative:
Yasuro Hayashi, President
Inquiries:
Nobuyasu Takeuchi, Director & Administration Manager
Scheduled date of quarterly securities report filing:
August 9, 2018
Scheduled date of dividend payment commencement:―
Preparation of quarterly supplementary explanatory materials:
None
Quarterly results briefing held:
None

August 6, 2018
Tokyo Stock Exchange
http://www.grandy.co.jp
TEL: +81-28-650-7777(Figures are rounded down to the nearest million yen unless otherwise stated.)

1. Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2019
(April 1, 2018 to June 30, 2018)(1) Consolidated Operating Results

Net Sales(Percentage figures show the year-on-year increase (decrease).)Net Income Attributableto Owners of the Parent
Operating Income
Ordinary Income
Company(¥ million)%(¥ million)%(¥ million)%(¥ million)%

10,341

1.4

709

34.7

744

34.2

293

(20.8)

10,195(8.2)

526(36.4)

554(35.5)

370(33.5)

Three months ended
June 30, 2018
Three months ended
June 30, 2017
Note: Comprehensive income

Three months ended June 30, 2018: ¥280 million (-22.3%)
Three months ended June 30, 2017: ¥361 million (-35.4%)
Net Income per ShareNet Income per Share(Diluted)(¥)(¥)

Three months ended
June 30, 2018
Three months ended
June 30, 2017

10.18

10.01

12.89

12.78

Total Assets(¥ million)
47,59947,281Net Assets(¥ million)
19,375
19,556(2) Consolidated Financial Position

June 30, 2018
March 31, 2018
Reference: Shareholders' equity

Shareholders' Equity Ratio
%
40.3
41.0

Net Assets per Share(¥)
665.16671.43June 30, 2018: ¥19,181 million
March 31, 2018: ¥19,362 million

2. Dividends
1Q-EndAnnual Dividend per Shares
3Q-End
(¥)
(¥)
0.00
—

2Q-End(¥)——

Fiscal 2018
Fiscal 2019
Fiscal 2019 (Forecast)

0.00

—

Period-End

Total

(¥)
16.00

(¥)
16.00

16.00

16.00

Note: Revisions to the most recently announced forecast of cash dividends in the current quarter: None

3. Consolidated Financial Forecasts for Fiscal 2019 (April 1, 2018 to March 31, 2019)

Net Sales

Full Fiscal Year(¥ million)
48,000Operating Income%
7.3(¥ million)
2,900

%
7.6

(Percentage figures show year-on-year increase (decrease).)Net Income
Attributable toOrdinary Income
Net Income per ShareOwners of the Parent
Company(¥ million)%(¥ million)
%
(¥)
3,000
7.3
1,680
(8.1)
58.26

Note: Revisions to the most recently announced financial forecasts in the current quarter: None* Explanatory Notes(1) Changes of important subsidiaries during the period(changes in specified subsidiaries resulting in a change in the scope of consolidation): None
Newly included: —Excluded: —(2) Adoption of specific methods for preparation of the quarterly consolidated financial statements: None
(3) Changes in accounting policies, accounting estimates, and restatements
1) Changes in accounting policies in connection with revision to accounting standards, etc.:
2) Changes in accounting policies other than 1):
3) Changes in accounting estimates:
4) Restatements:(4) Number of shares issued and outstanding (common stock)1) Number of shares issued and outstanding
June 30, 2018as of the period-end (including treasury shares)June 30, 2018
2) Number of treasury shares
Three months
3) Average number of shares issued andended June 30,
outstanding for the period
2018

None
None
None
None

30,823,200 shares March 31, 201830,823,200 shares

1,985,245 shares March 31, 2018
Three months
28,837,955 shares ended June 30,
20171,985,245 shares
28,776,955 shares*This consolidated quarterly financial report is not subject to auditing by a certified public accountant or an audit firm.

*

Explanation concerning the appropriate use of forecasts and other special instructions
Results forecasts and other forward-looking statements contained in this report are based on assumptions, beliefs, anduncertainties in light of information available to the Company's management as of the publication date. Actual results may
differ materially from forecasts due to a variety of factors. Therefore, the Company does not guarantee the accuracy of
forecasts and other forward-looking statements and its ability to achieve stated targets.

Attachment Materials: Table of Contents
1. QUALITATIVE INFORMATION ON FINANCIAL STATEMENTS.................................................................. 2(1) Explanation regarding Operating Results ................................................................................................................ 2(2) Explanation regarding Financial Position ................................................................................................................ 3(3) Explanation regarding Future Prospects including Consolidated Financial Forecasts ............................................ 3
2. QUARTERLY CONSOLIDATED FINANCIAL STATEMENTS AND NOTES................................................. 4(1) Quarterly Consolidated Balance Sheets................................................................................................................... 4(2) Quarterly Consolidated Statements of Income and Consolidated Statements of Comprehensive Income .............. 6(Quarterly Consolidated Statements of Income)(Consolidated cumulative first quarter) ...................................................................................................................6(Quarterly Consolidated Statements of Comprehensive Income)(Consolidated cumulative first quarter) ...................................................................................................................7(3) Notes to Quarterly Consolidated Financial Statements ........................................................................................... 8(Notes on Going Concern Assumptions) .................................................................................................................8(Notes on Significant Changes in the Amount of Shareholders' Equity) .................................................................8(Supplemental Information) ....................................................................................................................................8(Segment and Other Information)............................................................................................................................8―1―

1. QUALITATIVE INFORMATION ON FINANCIAL STATEMENTS(1) Explanation regarding Operating Results
During the three months ended June 30, 2018, the Japanese economy was considered to be on a gradual
recovery path, although it posted negative growth in the period of January to March this year after eight
consecutive quarters of positive growth until the end of last year.
In the housing sector, new housing starts grew firmly due to the interest rate on housing loans remaining at
low levels, as well as the continuation of various support measures to promote home acquisition and an
improvement in employment and income conditions, but competition between business has kept intensifying.
Under these circumstances, the Grandy House Group continued to strive to expand and reinforce businessunder the basic policy in the second medium-term business plan (from the fiscal year ending March 2019 to thefiscal year ending March 2021) of "continuous growth through reinforcing the core operation (new homes)" and"expansion of business through enhancing the stock business."
With regard to new home sales, one of our core operations, we endeavored to boost sales of strategic large
housing lots, reinforce our product appeal, and improve profits through cost reduction and other measures while
proceeding to examine strategies for expanding into Saitama Prefecture among others.
In existing home sales, we continued the effort from the previous fiscal year to build up product inventory
toward expanding home sales.
Although the number of homes sold for the first quarter of Fiscal 2019 increased only slightly both in newand existing homes on a year-on-year basis, operating income improved significantly due mainly to the fruits ofthe effort to improve profits and a year-on-year decrease in selling, general and administrative expenses.
As a result of these initiatives, the Grandy House Group's consolidated results for the first quarter of Fiscal
2019 were as follows. Net sales were ¥10,341 million, up 1.4% from the same period of the previous fiscal year;
operating income rose to ¥709 million, an increase of 34.7% year-on-year; ordinary income was ¥744 million, an
increase of 34.2% year-on-year. However, net income attributable to owners of the parent company declined to¥293 million yen, a decrease of 20.8% year-on-year due primarily to the booking of the provision of directors
retirement benefits accompanying the stepping down of our company founder as a director.
Results by business segment are presented as follows.
Real Estate Sales
In new housing sales, we opened a new block with a different concept in addition to two ones already on salein Yotsuba no Mori housing lots, a strategic project that had entered the second year since its sale started, (211lots in Tsukuba in Ibaraki Prefecture) in an attempt to add product variations and, at the same time, boosted sales
activities for large housing lots, such as GRAND BEAT PARK Kaminokawa (141 lots, Kaminokawamachi,
Tochigi Prefecture), which we started selling from the end of the previous fiscal year. In terms of products, we
continued to differentiate our products from those of our competitors by pursuing our "Townscape creation"
policy that gave a theme to each housing lot and harmonized the distinctive appearance of homes and the totalityof the housing lot, as well as to launch a new initiative, such as building model homes that were equipped with
IoT. As for expanding our sales area, we made progress in examining a practical strategy with an eye on opening
a store in Saitama Prefecture within this current fiscal year.
Through initiatives such as these, orders received for new homes for the first quarter of Fiscal 2019 were 329
homes, an increase of six homes year on year, but new home sales marginally increased to 308 homes, anincrease of two homes year on year. On the other hand, in respect of profit improvement that became an issue inthe previous fiscal year, operating income was improved mainly because the initiative for cost reduction had
started bearing fruit, and selling, general and administrative expenses made a year-on-year decrease.
In existing home sales, we continued making efforts to expand existing home sales by enhancing productinventory as we did in the previous fiscal year. Amid competition intensifying through auctions, we managed toincrease the total inventory as a result of reinforcing procurement by setting up a goal of keeping 70 completed
homes in inventory at any time. Nevertheless, existing home sales for the first quarter of Fiscal 2019 edged up to31, an increase of one home year-on-year, due partly to the fact that the inventory of complete homes remained
below the goal.
As a result of these initiatives, sales in the real estate sales segment increased by 1.3% year-on-year to ¥9,522
million. Segment profit rose to ¥664 million, up 41.7% from the same period of the previous fiscal year.

―2―Construction Material Sales
In construction material sales, new housing starts for wooden houses including custom-made houses havestayed below those in the same period of the previous fiscal year since July of last year. Meanwhile, woodmaterial prices remain high.
Under such circumstances, the Grandy House Group made efforts, such as boosting sales of building
materials (other than pre-cut materials) and housing equipment and switching sales to our best customers in termsof earnings.
As a result of these factors, sales in the construction materials sales segment increased by 3.9% year-on-yearto ¥755 million. Segment profit rose to ¥46 million, up 8.5% from a year earlier.
Real Estate Leasing
In the real estate leasing, more stores were opened in or relocated to the city center in the office building
market in and around Utsunomiya, which is our main market. In the parking lot market, competition remained
intense between parking lots in the vicinity.
In this context, while we made efforts to improve the operation rate of existing assets and reduce management
costs, the impact of the rise of vacancy rates, which started toward the end of last year, persisted. Consequently,
sales in the real estate leasing segment were ¥63 million, a decrease of 4.7% year on year, and segment profit was¥42 million, a decrease of 5.4% on year on year.
(2) Explanation regarding Financial Position
As of the end of the first quarter of Fiscal 2019, total consolidated assets slightly rose to ¥47,599 million, an
increase of ¥318 million compared to the end of the previous consolidated fiscal year. This was due to a
successful effort to curb an increase in inventories through our selective and restrictive approach to purchasing,based on the situation of inventory with sales of large housing lots for the current fiscal year factored in, in termsof new home sales.
Liabilities slightly increased to ¥28,223 million, up ¥498 million compared to the end of the previous
consolidated fiscal year due mainly to curbing an increase in inventories, also ending up limiting new loans.
Furthermore, we are making efforts that are continued from the previous fiscal year to switch our fundprocurement method to financing by bonds for a part of our loans in order to reduce the burden of interest
payments and to make flexible use of funds.
Total net assets stood at ¥19,375 million as of June 30, 2018, down ¥180 million compared with the end of
the previous fiscal year. After accounting for the acquisition of net income attributable to owners of the parent
company, this decrease was largely due to the payment of dividends.
(3) Explanation regarding Future Prospects including Consolidated Financial Forecasts
There is no change to financial forecasts announced on May 7, 2018.

―3―

2. QUARTERLY CONSOLIDATED FINANCIAL STATEMENTS AND NOTES(1) Quarterly Consolidated Balance Sheets(Thousands of Yen)FY2018(As of March 31, 2018)

First Quarter of FY2019(As of June 30, 2018)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable – trade
Real estate for sale
Costs on uncompleted construction contracts
Real estate for sale in process

9,813,941

9,775,984

672,527

599,151

16,588,298

16,636,866

2,414

7,045

8,936,229

9,066,308

Merchandise and finished goods

211,897

235,221

Raw materials and supplies

166,467

178,713

Other413,250

677,526

Allowance for doubtful accounts(4,348)(3,775)36,800,680

37,173,042

3,256,709

3,226,107

Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net

6,175

5,101

Tools, furniture and fixtures, net

62,56357,264

5,319,659

5,319,659

69,002

62,163–25,0008,714,109

8,695,296

66,862

62,795Investment securities

428,336409,260

Long-term loans receivable

14,85914,572

Land
Leased assets, net
Construction in progress
Total property, plant and equipment
Intangible assets
Investments and other assets

Deferred tax assets

381,203361,244

Other

846,788843,330

Allowance for doubtful accounts(4,901)(4,783)

Total investments and other assets

1,666,286

1,623,624

10,447,258

10,381,716

Bond issuance costs

33,38844,665

Total deferred assets

33,38844,66547,281,326

47,599,424

Total non-current assets
Deferred assets

Total assets―4―

(Thousands of Yen)FY2018(As of March 31, 2018)

First Quarter of FY2019(As of June 30, 2018)

Liabilities
Current liabilities
Accounts payable for construction contracts

3,408,906

3,308,767

Short-term loans payable

19,177,700

19,181,500

Current portion of long-term loans payable

494,513579,224

Current portion of bonds

21,00021,000

Lease obligations

24,40323,319

Income taxes payable

495,419

128,766

Provision for warranties for completed construction

58,686

58,070Other

755,677

1,378,334

24,436,306

24,678,982

Bonds payable

1,066,000

1,555,500

Long-term loans payable

Total current liabilities
Non-current liabilities

1,384,806

1,168,109

Lease obligations

50,09943,838Provision for directors' retirement benefits

166,279

145,629

Net defined benefit liability

571,584

582,547

Asset retirement obligations

4,296

4,308

Other
Total non-current liabilities
Total liabilities

45,48344,675

3,288,549

3,544,607

27,724,855

28,223,590

2,077,500

2,077,500

Net assets
Shareholders' equity
Capital stock
Capital surplus

2,223,038

2,223,038

Retained earnings

15,407,196

15,239,425

Treasury shares(341,339)(341,339)

19,366,395

19,198,624

Valuation difference on available-for-sale securities(3,824)(16,689)

Total accumulated other comprehensive income(3,824)(16,689)

193,900

193,900

19,556,471

19,375,834

47,281,326

47,599,424

Total shareholders' equity
Accumulated other comprehensive income

Subscription rights to shares
Total net assets
Total liabilities and net assets―5―(2) Quarterly Consolidated Statements of Income and Consolidated Statements of Comprehensive Income(Quarterly Consolidated Statements of Income)(Consolidated cumulative first quarter)(Thousands of Yen)
Three months ended
June 30, 2017
(From April 1, 2017
to June 30, 2017)

Three months ended
June 30, 2018
(From April 1, 2018
to June 30, 2018)

Net sales

10,195,571

10,341,270

Cost of sales

8,400,824

8,398,019

Gross profit

1,794,746

1,943,250

Selling, general and administrative expenses

1,268,307

1,234,066

526,439

709,183

Interest income

323

197

Dividends income

3,453

2,953

Operating income
Non-operating income

Operations consignment fee

59,48758,574

Office work fee

35,04436,500Other

22,586

10,338

Total non-operating income

120,895

108,564

Non-operating expenses
Interest expenses

85,27069,356

Commission for syndicate loan

2,738

1,666

Other

4,531

2,382

Total non-operating expenses

92,54073,404

554,794

744,343

Loss on retirement of non-current assets

5,309

5,925

Loss on cancellation of lease contracts–

439

Directors' retirement benefits–

300,000

Ordinary income
Extraordinary loss

Total extraordinary loss

5,309

306,365

Net income before income taxes

549,484

437,978

Income taxes – current

179,287

118,748(594)

25,594

Total income taxes

Income taxes – deferred

178,692

144,342

Net income

370,792

293,635

Net income attributable to non-controlling interests
Net income attributable to owners of the parent company

―6―

–

–

370,792

293,635

(Quarterly Consolidated Statements of Comprehensive Income)(Consolidated cumulative first quarter)(Thousands of Yen)

Net income

Three months ended
June 30, 2017
(From April 1, 2017
to June 30, 2017)

Three months ended
June 30, 2018
(From April 1, 2018
to June 30, 2018)

370,792

293,635(9,387)(12,864)

Other comprehensive income
Valuation difference on available-for-sale securities
Total other comprehensive income(9,387)(12,864)

361,404

280,770

Comprehensive income attributable to owners of the parent
company

361,404

280,770

Comprehensive income attributable to non-controlling interests––

Comprehensive income
Comprehensive income attributable to:―7―(3) Notes to Quarterly Consolidated Financial Statements(Notes on Going Concern Assumptions)Not applicable.
(Notes on Significant Changes in the Amount of Shareholders' Equity)
Not applicable.
(Supplemental Information)(Adoption of "Partial Amendments to Accounting Standard for Tax Effect Accounting," etc.)
We adopted "Partial Amendments to Accounting Standard for Tax Effect Accounting" (Corporate
Accounting Standards No. 28: February 16, 2018), etc. from the beginning of the first quarter of Fiscal 2019, anddeferred tax assets are reported in Investment and other assets.
(Segment and Other Information)
Segment Information
I. The three months ended June 30, 2017 (April 1, 2017 to June 30, 2017)
1. Information relating to the amounts of net sales, profit and loss by reportable segment
Reportable Segment

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

Adjustments(Note 1)(Thousands of Yen)
AmountRecorded on
Quarterly
Consolidated
Statements ofIncome (Note 2)

Real Estate
Sales

Construction
Material Sales

Real Estate
Leasing

9,401,532

727,629

66,40910,195,571—

10,195,571—

835,807

19,870855,677(855,677)—

9,401,532
468,772

1,563,436
43,002

86,27945,442

11,051,249
557,217(855,677)(2,422)

10,195,571
554,794

Total

Notes: 1 Adjustments of segment profit (-¥2,422 thousand) are eliminations of inter-segment transactions.
2 Segment profit has been adjusted to ordinary income described in quarterly consolidated statements of income.

2. Information concerning the impairment loss of non-current assets and goodwill by reportable segment
Not applicable.
II. The three months ended June 30, 2018 (April 1, 2018 to June 30, 2018)
1. Information relating to the amounts of net sales, profit and loss by reportable segment
Reportable Segment

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

Adjustments(Note 1)(Thousands of Yen)
AmountRecorded on
Quarterly
Consolidated
Statements ofIncome (Note 2)

Real Estate
Sales

Construction
Material Sales

Real Estate
Leasing

9,522,175

755,780

63,314

10,341,270—

10,341,270—

789,868

20,748810,617(810,617)—

9,522,175
664,374

1,545,649
46,66484,062
42,991

11,151,887
754,030(810,617)(9,686)

10,341,270
744,343

Total

Notes: 1 Adjustments of segment profit (-¥9,686 thousand) are eliminations of inter-segment transactions.
2 Segment profit has been adjusted to ordinary income described in quarterly consolidated statements of income.

2. Information concerning the impairment loss of non-current assets and goodwill by reportable segment
Not applicable.

―8―