Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement

Kyoritsu Maintenance Co., Ltd.
(Securities Code: 9616)

Fiscal Year Ended March 2016
Consolidated Earnings Results Update
May 2016

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Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement

Fiscal Year Ended March 2016 Consolidated Earnings Announcement
May 13, 2016

Company Name: Kyoritsu Maintenance Co., Ltd.
Tokyo Stock Exchange
Stock Code: 9616, URL: http://www.kyoritsugroup.co.jp/
Director: Mitsutaka Sato, President
Contact: Takumi Ueda, Vice President, Tel: +81-3-5295-7778
General Shareholders Meeting (Anticipated): June 29, 2016; Dividend Payment Date (Anticipated): June 30, 2016
Financial Accounts Filing Date (Anticipated): June 29, 2016
Earnings Presentation Document: Available
Earnings Presentation Meeting: Available (for institutional investors)(All figures of less than one million yen are rounded down to the nearest digit)
1. Fiscal Year Ended March 2016 Consolidated Earnings (April 1, 2015 to March 31, 2016)(1) Consolidated Earnings (Aggregated)
Net Sales

Operating Income％

Million yen

FY3/16135,053

Ordinary Income％

Million yen

22.5

10,244

Profit attributable to ownersof parent％

Million yen

24.7

9,775

27.6

FY3/15110,212
4.7
8,217
9.7
7,663
12.7
(Note) Comprehensive income: ¥5,405 million (3.9% YoY) in FY3/16; ¥5,200 million (28.1% YoY) in FY3/15
EPS

Fully Diluted EPS
Yen

ROE

5,970

36.1

4,387

14.6

Ordinary Income toTotal Asset Ratio

Operating Margin

％

％

％

Yen

％

Million yen

11.4
6.5
7.6
314.56305.4810.8
5.6
7.5
275.29224.78
FY3/15(Reference) Equity accounting method profit: ¥0 in FY3/16; ¥0 in FY3/15(Note) The Company carried out a stock split on April 1, 2015 at a ratio of 1.2 shares per one common share. Accordingly, EPS and fully
diluted EPS have been calculated presuming that this stock split was carried out at the start of the previous consolidated fiscal year.
FY3/16(2) Consolidated Financial Position
Total Assets
FY3/16

Net Assets

Equity Ratio

Book Value Per Share

Million yen

Million yen％

Yen161,40257,97435.9

2,997.10

139,750
46,913
FY3/1533.6
2,658.90(Note) Capital: ¥57,974 million in FY3/16; ¥46,913 million in FY3/15(Note) The Company carried out a stock split on April 1, 2015 at a ratio of 1.2 shares per one common share. Accordingly, book value pershare has been calculated presuming that this stock split was carried out at the start of the previous consolidated fiscal year.
(3) Consolidated Cash Flow Conditions
Operating Cash Flow

Investing Cash Flow

Cash and Equivalents at
Term End

Financing Cash FlowMillion yen

Million yen

Million yen

Million yen

FY3/16

8,222(13,971)

15,70825,603

FY3/15

7,679(12,018)(3,760)15,758

2. Dividend Conditions
Dividend Per Share
1Q-End2Q-EndYen

FY3/15
FY3/16

3Q-End

Yen

-

24.00
25.00

4Q-EndYen-

Total Dividend

Dividend

Dividend to Net

Payment(Annual)Payout Ratio(Consolidated)

Asset Ratio(Consolidated)

Total

Yen

Yen

Million yen

％

％

26.00
27.00

50.00
52.00

695
1,003

15.1
16.5

1.7
1.8

FY3/17 (Forecast)
26.00
26.00
52.00
14.6
(Note) The Company carried out a stock split on April 1, 2015 at a ratio of 1.2 shares per one common share. The actual dividend amountprior to the stock split is noted here for the fiscal years ended in March 2015.
3. Fiscal Year Ending March 2017 Consolidated Earnings Estimates (April 1, 2016 to March 31, 2017)
Net Sales

Operating Income

Profit attributable to ownersof parent

Ordinary Income

EPS

Million yen％

Million yen％

Million yen％

Million yen％

Yen

First Half

69,800

4.4

7,100

15.4

6,700

16.2

4,200

10.5

217.13Full Year138,000

2.2

11,50012.3

11,000

12.5

6,900

15.6

356.71

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Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement
Notes(1) Important changes in our subsidiaries, including changes to the scope of our consolidation: None
(2) Changes in the accounting policies, procedures, and changes or revisions in the display of accounting estimates:
1. Changes accompanying revisions in accounting standards:
Applicable
2. Other changes:
None
3. Changes in accounting estimates:
None
4. Redisplay of revisions:
None
(3)

Shares Issued (Common Stocks)
1. Shares issued as of term-end (including treasury shares)
2. Treasury Shares as of term-end
3. Average during the term

FY3/16
FY3/16
FY3/16

19,452,173
108,573
18,981,241

FY3/15
FY3/15
FY3/15

18,150,698
506,662
15,938,943(Note) The Company carried out a stock split on April 1, 2015 at a ratio of 1.2 shares per one common share. Accordingly, shares issued(common stocks) has been calculated presuming that this stock split was carried out at the start of the previous consolidated fiscal year.
(Reference) Outline of non-consolidated business results
1. Fiscal Year Ended March 2016 Parent Earnings (From April 1, 2015 to March 31, 2016)(1) Parent Earnings
Net Sales
For the fiscal year ended

Operating Income(% figures show year-on-year change)

Ordinary Income

Net Income

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

March 31, 2016

104,912

10.7

9,668

18.9

9,589

18.0

6,279

21.9

March 31, 2015

94,766

7.0

8,131

16.5

8,124

16.1

5,152

21.0

Book Value Per ShareNet Income Per Share–Diluted

For the fiscal year ended

Yen

Yen

March 31, 2016330.82321.26

March 31, 2015

323.29263.97(Note) The Company carried out a stock split on April 1, 2015 at a ratio of 1.2 shares per one common share. Accordingly, book value pershare and net income per share–diluted have been calculated presuming that this stock split was carried out at the start of the previous
consolidated fiscal year.
(2) Parent Financial Position
Total Assets

Net Assets

Equity Ratio

Book Value Per Share

Millions of yen

Millions of yen%

Yen

As of March 31, 2016

146,034

56,80238.9

2,936.49

As of March 31, 2015

123,747

44,87636.3

2,543.46(Reference) Shareholders’ equity:

As of March 31, 2016: ¥56,802 million
As of March 31, 2015: ¥44,876 million(Note) The Company carried out a stock split on April 1, 2015 at a ratio of 1.2 shares per one common share. Accordingly, book value pershare has been calculated presuming that this stock split was carried out at the start of the previous consolidated fiscal year.

2. Fiscal Year Ending March 2017 Parent Earnings Estimates (April 1, 2016 to March 31, 2017)
Net Sales

Operating Income

Million yen%

First Half

56,300

Full Year

113,000

Ordinary Income

Million yen

%

7.9

6,500

10.5

7.7

10,700

11.6

Million yen

EPS
%

Yen

4,300

6.1

222.30

7,100

13.1

367.05*Regarding the implementation of audit procedure in the display of this document:This earnings announcement is exempted from the financial instruments and exchange act founded in the audit procedures, and at the time of the release ofthis earnings announcement, the auditing procedures for the financial statements in this document have not been completed.
*Notes and explanation of appropriate usage of earnings estimates:
All earnings estimates and forward-looking statements in this document are based on the best information available and rational decisions of management
at the time of its creation, and actual earnings may diverge largely from those estimates and forward-looking statements put forward in this document due
to various unforeseen factors. Moreover, for information regarding earnings estimates and the assumptions upon which they are based, and the usages ofthese earnings estimates, please refer to the section “Analysis of Business Results” on page 5.
(Method for obtaining supplementary explanatory information on financial results and the briefing on financial results)
The Company will post supplementary explanatory information on financial results on its website.

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Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement
Index
1. Analysis of Business Results, Financial Conditions

5(1) Analysis of Business Results

5(2) Analysis of Financial Conditions

8(3) Our Basic Policy Regarding the Distribution of Profits in the Current and Next Terms

9(4) Business Risks

9

2. Corporate Structure

10

3. Management Policy

12(1) Our Basic Management Policy

12(2) Benchmarks of Our Intermediate to Long-Term Management Strategy

12(3) Key Management Issues

12

4. Basic Approach to Selecting Accounting Standards

12

5. Consolidated Financial Statements

13(1) Consolidated Balance Sheets

13(2) Consolidated Income Statement and Comprehensive Income Statement

15

Consolidated Income Statement

15

Consolidated Comprehensive Income Statements

17(3) Consolidated Shareholders’ Equity Statements(4) Consolidated Cash Flow Statements

1820(5) Consolidated Financial Statement Notes(Notes Regarding Going Concern Assumptions)22
22(Important articles in the assumption used to create consolidated financial statements)

22(Segment Information)

22

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Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement
1. Analysis of Business Results, Financial Conditions(1) Analysis of Business Results
1. Overview of Overall Earnings in Current Term
(Consolidated Earnings)(Unit: million yen)Previous Term
FY3/15110,212
8,217
7,663
4,387

Current Term
FY3/16135,053
10,2449,775
5,970% YoY Change

Net Sales
22.5
Operating Income
24.7
Ordinary Income
27.6
Profit attributable to owners
36.1
of parent
During the fiscal year ended March 31, 2016, the Japanese economy experienced a modest recovery trend, with signs ofimprovements in corporate earnings and the employment environment, but this was slow to spill over into spending suchas capital investments and personal consumption. In this environment, Japan’s travel market experienced record-highnumbers of foreign travelers to Japan, with a 47.1% climb over the previous year to 19,737,000. Inbound consumption
also surged 71.5% to more than ¥3.4 trillion.
Against this backdrop, the Group established the Kyoritsu Full Acceleration Plan, a three-year medium-term management
plan that was launched this fiscal year. In order to meet customer needs, the Group operated its business in line with thebasic policies of “actively accelerating development and investment in a concentrated manner” and “strengthening
profitability by optimizing the balance between value and price.”
In the hotel business segment, we opened seven hotels, which had led to concerns that the increase in costs to prepare forhotel openings would slow the revenue growth rate. However, the mainstay dormitory business was solid, and the DormyInn business hotel business recorded significant growth, driving gains in income. Moreover, Kyoritsu Maintenancecontinued to undertake public and investor relations activities aimed at deepening understanding of its services. This
included the sponsorship of the “Hakone Ekiden” long-distance university relay race, which has a close relationship withour business.
As a result, sales rose 22.5% year on year to ¥135,053 million, operating income increased 24.7% to ¥10,244 million yen
and ordinary income was up 27.6% to ¥9,775 million yen. Profit attributable to owners of parent climbed 36.1% over theprevious year to ¥5,970 million. These results set the record for highest earnings, having surpassed the results of previous
fiscal year, and also far exceeded our earnings forecasts, which had been revised upward and released on November 9,
2015.
2. Our Main Business Segment Performance
Dormitory Business (Student, Corporate, Domeal, Consigned Dormitories)(Unit: million yen)Previous Term
Current Term
% YoY Change
FY3/15
FY3/16
Contracted Residents
33,48935,489
6.0
Sales (million yen)
42,66544,395
4.1
Operating Income
6,371
6,574
3.2
(million yen)
The dormitory business got off to a good start with a 0.1% year-on-year increase in the initial occupancy rate over theprevious year to 97.3%, a level that remained solid throughout the year.
The student dormitory business continued to benefit from high needs for dormitories due to the rise in university attendance
rates and an increase in students from abroad attending universities in Japan. In this fiscal year, we succeeded in forming
new alliances with Tohoku Gakuin University and ten others. We also introduced the resident assistant (RA) system in aneffort to create added value in dormitories. As a result of these efforts, the number of contracted residents in the student
dormitories rose by 833 year-over-year to 20,574 residents and sales rose by 1.7% year over year to ¥25,382 million.
The corporate dormitory business benefited from an increase in the hiring of new graduates and other factors. The rise in
the number of corporations introducing dormitories for the first time and an increase in contracts on an individual building
basis resulted in a substantial increase in the number of contracts. As a result, the number of contracted residents rose by
885 year over year at the end of the fiscal year to 9,998, and sales rose by 7.9% year over year to ¥11,294 million.
In our Domeal business, we received support from client schools and companies through their introductions of newresidents seeking dormitories and also met demand from people looking to move from dormitories providing meals by
providing studio-type dormitory facilities. Consequently, the number of contracted residents rose by 282 year-over-year to
4,917, and sales grew by 7.1% year over year to ¥4,165 million. In our consigned dormitory business, we manage corporate
and school dormitory facilities on a consigned basis, and we endeavor to differentiate our services by promoting our status
as “Japan’s best dormitory operator.” Consequently, sales rose by 6.2% year over year to ¥3,552 million.

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Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement
As a result, the number of dormitory facilities increased by 19 over the previous year to 455 (excluding consigned
facilities), contracted residents grew by 1,797 to 36,176, and sales increased by 4.1% over the previous year to ¥44,395
million. On the expense side, the Company continued to strictly manage costs on a facility-by-facility basis, which allowed
operating income to increase by 3.2% over the previous year to ¥6,574 million.
Hotel Business (Dormy Inn, Resort Hotels)(Unit: million yen)Previous Term
Current Term
% YoY Change
FY3/15
FY3/16
Sales
46,92953,43013.9
Operating Income
4,736
6,006
26.8
The hotel business provides significant satisfaction to customers, and benefited from an increase in Japanese travelers andrepeat customers, as well as the continued growth in inbound demand, despite the yen’s strength since the start of the year.
As a result, high occupancy rates and room rates exceeded levels in the previous fiscal year, boosting revenue significantly.
Against this backdrop, in the Dormy Inn business hotel business, “Natural Springs Kinko no Yu Dormy Inn PREMIUM
Nagoya Sakae,” “Kachi no Yu Dormy Inn Ueno Okachimachi,” “Natural Springs Kousho no Yu Dormy Inn
Higashimuroran” and “Natural Springs Yunagi no Yu Onyado Nono Sakaiminato” were opened this fiscal year. “Natural
Springs Yunagi no Yu Onyado Nono Sakaiminato” was designed to meet a wider range of customer needs as the firstJapanese-style premium hotel in the Dormy Inn brand. As a result, sales were up 21.9% year-over-year to ¥28,541 million.
In the resort hotel business, we opened “Kamui no Yu La Vista Akangawa,” “La Vista Fuji Kawaguichiko,” and“Hakone-Yumoto Onsen Tsuki no Yado Sara.” Business in Hakone remained difficult after the eruption alert level was
raised for Mount Hakone in May, but the alert level was lowered in November, which led to a gradual recovery in theoccupancy rates to typical levels. Consequently, sales rose by 5.9% year over year to ¥24,889 million.
As a result, the total number of facilities in operation rose to 78 (up six from the previous year) and the number of rooms to
11,595 (up 771 from the previous fiscal year) in the hotel business overall. Sales and operating income rose 13.9% and26.8% year over year to ¥53,430 million and ¥6,006 million, respectively.
Contracted Services Business(Unit: million yen)Previous Term
FY3/15Current Term
FY3/16% YoY Change

Sales12,626
14,859
17.7
Operating Income
376
508
35.0
In the contracted services business, both sales and income increased due to rental properties acquired in the previous fiscal
term, in addition to more business taken on by the building management sector. As a result, sales increased 17.7% to¥14,859 million and operating income increased by 35.0% year over year to ¥508 million.
Food Services Business(Unit: million yen)Previous Term
FY3/15Current Term
FY3/16% YoY Change

Sales
5,330
5,787
8.6
―
Operating Income(1)(4)
The food service business generated higher sales thanks to new store openings, but lower operating income due to an
adverse impact from expenses for new store openings and other such costs. Consequently, sales rose by 8.6% year on year
to ¥5,787 million, and we posted an operating loss of ¥4 million (compared to ¥1 million operating loss in the previous
fiscal year).

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Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement
Construction Business(Unit: million yen)Previous Term
FY3/15Current Term
FY3/16% YoY Change

Sales
9,456
16,313
72.5
Operating Income
277
677
144.0
Despite development costs remaining at high levels, the construction business generated increases in sales and income due
to success in bringing in a greater numbers of orders for hotel development and an increase in the sale of built-for-salecondominiums. Consequently, sales and operating income rose by 72.5% and 144.0% year on year to ¥16,313 million and¥677 million, respectively.
Other Business(Unit: million yen)Previous Term
FY3/15Current Term
FY3/16% YoY Change

Sales
8,871
11,786
32.9―
Operating Income
(748)
(212)
Our other business segments are the Senior Life (former Wellness Life) business (management of senior citizen housing),
the Public Kyoritsu Partnership business (PKP: consigned services business provided to regional government bodies),
single life support business and insurance agency business, comprehensive human resource services business, and financing
and administrative outsourcing services.
The other business segments posted total net sales of ¥11,786 million, an increase of 32.9% year on year, but still incurredan operating loss of ¥212 million, in comparison with an operating loss of ¥748 million in the same period of the previous
fiscal year.
The substantial year-on-year decrease of operating loss was largely attributable to higher profitability associated withexpansion of the PKP business and operational streamlining.
3. Earnings Estimates for the Coming Term
(Consolidated)
Current Term
FY3/16Net Sales
135,053
Operating Income
10,244
Ordinary Income
9,775
Profit attributable to owners
5,970
of parent(Unit: million yen)
Coming Term
FY3/17138,000
11,500(Parent Earnings)% YoY Change

11,000

2.2
12.3
12.5

6,900

15.6

(Unit: million yen)
Current Term
Coming Term
% YoY Change
FY3/16
FY3/17
Net Sales
104,912
113,000
7.7
Ordinary Income
9,589
10,70011.6
Net Income
6,279
7,100
13.1
In the next fiscal year, the Japanese economic outlook is expected to remain uncertain due to an economic slowdown in
China and other Asian countries and exchange rate fluctuations. The impact of the Kumamoto earthquake, which occurredin April, is also a concern.
The dormitory business occupancy rate in April got off to a good start at 98.3%, up 1.0 point over the previous year.
Demand is stable in the dormitory business, and we expect solid performance in the next fiscal year. Kyoritsu is taking
steps to flexibly respond to greater diversification among residents as well as their diverse needs, while also building astable revenue structure by optimizing costs.
In the hotel business, we plan to open seven new facilities in the Dormy Inn business (business hotels), with the Natural Hot
Springs Tentono Yu Dormy Inn Abashiri and Onyado Nono Toyama (tentative name) in June, followed by Global Cabin
Gotanda (tentative name) in July and the Dormy Inn Nagano (tentative name) in August, as well as the Dormy Inn
PREMIUM Tokyo Kodemmacho (tentative name), Onyado Nono Nanba (tentative name) and the Group’s second overseas(South Korea) facility, to be called Dormy Inn SEOUL Gangnam (tentative name). The resort hotel business plans to open
Naruko Kissho (tentative name).
In the contracted services business, Kyoritsu will implement measures to increase our credibility with customers throughimprovements in our specialized technologies and product lineup. These measures will also allow us to aggressively
provide customers with high-quality building maintenance and other services that are highly competitive within the market
with our new enhanced organization.

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Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement
In the food services business, Kyoritsu will develop products and services with high levels of customer satisfaction, andimplement strict management of variable costs as part of its earnings reform strategy.
In our construction business, we will continue to support the Kyoritsu Group development and new facility opening plans,in addition to cultivating external clients and strictly managing costs.
In our other business segment, we will focus on quickly establishing a business model to make the Wellness Life businessand the Public Kyoritsu Partnership (PKP) next-generation businesses and realize higher levels of profitability.
In the next fiscal year, we expect to post modest growth in consolidated sales as the development business, which achieved
strong gains in sales due to concentrated sales of built-for-sale condominiums in the current fiscal year, returns to more
moderate growth. We also take into account the impact of the Kumamoto earthquake and the cost of preparing the openingsof eight new hotels in the hotel business. Given these factors, we expect income to remain on an upward trajectory overall,with consolidated net sales expected to increase 2.2% to ¥138,000 million, operating income to rise 12.3% to ¥11,500
million, ordinary income to grow 12.5% to ¥11,000 million and profit attributable owners of parent to increase 15.6% to¥6,900 million. We expect to achieve the sales targets in the medium-term business plan ahead of schedule, in the second
year of the plan.
On a non-consolidated basis, we forecast a 7.7% increase in net sales to ¥113,000 million, a 11.6% increase in ordinary
income to ¥10,700 million and a 13.1% increase in net income to ¥7,100 million.
(2) Analysis of Financial Conditions
1. Conditions of Assets, Liabilities, and Net Assets(Assets)
During the current fiscal year, total consolidated assets increased by ¥21,652 million from the end of the previous fiscal
year to ¥161,402 million. The main factors behind this increase included rises in cash and deposits and land.
(Liabilities)
Over the same period, total liabilities increased by ¥10,591 million to ¥103,428 million due primarily to increase inconvertible bond-type bonds with subscription rights to shares.
(Net Assets)
Net assets increased by ¥11,061 million to ¥57,974 million over the same period due primarily to increase in capital stock,capital surplus, and retained earnings. Consequently, equity ratio rose by 2.3 points from the end of the previous fiscal year
to 35.9%.
2. Cash Flow Conditions
Consolidated cash and equivalents increased by ¥9,844 million from the end of the previous term to ¥25,603 million at theend of the current term.
(Cash Flow from Operating Activities)
The net cash inflow from operating activities increased by ¥542 million from the previous term to ¥8,222 million in thecurrent term, due in part to the increase in net income before taxes and notes and accounts receivable - trade.
(Cash Flow from Investing Activities)
Due to the purchase of property, plant and equipment and payments for lease and guarantee deposits led to a ¥1,952 million
increase in the net cash inflow to ¥13,971 million in investing activities.
(Cash Flow from Financing Activities)
A net cash inflow in financing activities increased by ¥19,469 million from the previous term to ¥15,708 million reflecting
proceeds from an increase in short-term loans payable and proceeds from issuance of bonds.
(Reference) Trends in Our Cash Flow Indicators
FY3/12

FY3/13

FY3/14

FY3/15Equity Ratio (%)
25.1
28.4
26.2
Equity Ratio,
Market
19.5
30.7
34.4
Capital-Based (%)
Cash Flow toInterest-Bearing
11.3
11.6
8.8
Liability Ratio (%)
Interest Coverage
4.1
4.0
7.3
Ratio (x)Equity Ratio: Capital / Total Assets
Equity Ratio, Market Capital-Based: Market Capitalization / Total Assets
Cash Flow to Interest-Bearing Liability Ratio: Interest-Bearing liabilities / Operating Cash Flow
Interest Coverage Ratio: Operating Cash Flow / Interest Payments
1. Each indicator is based on consolidated financial data.

8

FY3/16

33.6

35.9

72.6

116.4

7.5

8.2

8.9

10.2

Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement
2. Market capitalization excludes treasury stock.
3. Cash flow is based on our operating cash flow.
4. Interest-bearing debt includes all of the liabilities that bear interest payments on our consolidated balance sheet.
5. We use interest payments from our consolidated cash flow statements.
(3) Our Basic Policy Regarding the Distribution of Profits in the Current and Next Terms
We consider the capital contributed by shareholders to be invaluable, and place a high priority on the distribution of profits toour shareholders in line with our earnings performance. One of our goals is to maintain a stable level of dividends over thelong term and we have established a target dividend payout ratio of 20%. With regards to the current term, we anticipate
increasing our dividend by ¥2 per share to ¥27 at the term-end for a full-year dividend of ¥52 per share. In the fiscal year
under review, we carried out a stock split (1:1.2) on April 1 and expect to increase dividends by an effective 24.8%. In the
future, we will endeavor to maintain a stable level of dividends while also responding flexibly to reflect changes in ourearnings. At the same time, we also seek to retain a level of earnings that will give our management the flexibility to makenecessary capital investments in response to changes in the market and to develop new businesses whenever appropriate.
(4) Business Risks
Below we note the important risk factors that may be considerations when making an investment in our Company. We
consider these factors to be the main risks existing during the course of our operations as of the end of the term under review.
1. Our Sales Conditions
In our core dormitory business, we operate and manage various facilities with the goal of providing a highly relaxing
environment and experience to our residents, making them feel as if they are in their own homes. In addition to our efforts tostrengthen our relationships with various schools to provide their students with room and board, we provide flexible housing
solutions to Japanese corporations, whose employee numbers change dramatically, by supplying them with only the numberof rooms they need to match the number of employees needing housing. Because our dormitories are primarily leased fromthe owners of the facilities, however, we are able to provide flexible solutions as mentioned above. At the same time, we areat risk of being negatively impacted by cancellation of resident contracts by schools and by corporations due to restructuringof their work force.
With regards to our hotel business, we have been able to insulate our Dormy Inn Hotels from large fluctuations in occupancy
rates by providing various unique services and amenities such as extended-stay programs that help to differentiate ourfacilities from those of our competitors. Despite our best efforts, we remain vulnerable to fluctuations and volatility incorporate demand caused by changes in the economy. In our resort hotel business, we are also subject to volatility inoccupancy rates arising from weather-related calamities such as typhoons, or earthquakes, as well as from fluctuations in theeconomy. Therefore sales may fall below our expectations during peak seasonal periods and our Group earnings may also be
impacted by these events.
Regarding our food services business, restaurant business is vulnerable to changes in consumer demand. Also there could be aloss of business arising from cancellations of outsourcing contracts for management of restaurants and cafeterias at golfcourses and corporate facilities. Therefore our Group earnings could be negatively impacted by these changes.
2. Financial Conditions
The Kyoritsu Maintenance Group endeavors to maintain consistent long-term growth as outlined in our intermediate-term
management strategy, but the attainment of this growth is premised upon our ability to secure assets that can be used as
dormitories and hotels. In the development of these assets, we take our financial standing into consideration and seek to makethe most effective use of all resources by utilizing various financial methods to yield safe and maximum returns. However,
our earnings and financial position are at risk of being negatively impacted by potential stagnation in the real estate market,
volatility in asset prices, extreme declines in cash flows from our existing assets, and inability to proceed as expected with
development of assets due to volatility in the financial markets.
3. Legal Regulations and Quality Control
Our Group provides both services and goods that are subject to various rules and regulations relating to food safety andsanitation under the Food Sanitation Act, privacy security under the Act on the Protection of Personal Information, andpersonal safety under the Inns and Hotels Act and the Fire Service Act, among other safety-related regulations and laws.
Therefore, our Group maintains compliance structures, risk committees and internal control structures to perform routinely
scheduled checks to ensure that we are in strict compliance with the various laws and regulations that are part of our business.

9

Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement
Despite our best efforts to prevent accidents, however, we still are at risk of losing our customers’ trust in the highly unlikely
event that an incident such as food poisoning or leakage of personal information were to occur and our earnings could also be
profoundly impacted.
4. Regarding the Implementation of “Asset Impairment Accounting”
On August 9, 2002, the Business Accounting Council announced a report entitled “Opinion Statement on the AccountingStandards for Fixed Asset Impairment Accounting.” Taking account of this Opinion Statement, the Financial AccountingStandards Foundation, Accounting Standards Board of Japan released on October 31, 2003 the policy paper entitled “Policy
Statement for the Implementation of Accounting Standards for Fixed Asset Impairment Accounting” (Implementation Policy
Number 6). In response to these moves by the accounting industry, we are now required to implement asset impairment
accounting with regards to our Group’s tangible and intangible fixed assets, including investments, other assets and leases.
And we recognize the risk of an extreme contraction in our cash flow by the implementation of asset impairment accounting
at times when there are dramatic fluctuations in the economy and financial markets.
5. Important Contracts
The dormitories and hotels we operate are leased by our company from the owners of the assets under blanket long-term leaseagreements ranging from 10 to 20 years. Some of these facilities have stipulations in their lease contracts that prohibit thecancellation of an agreement prior to the end of the lease term. Therefore, weak trends in occupancy rates of these managed
assets could negatively impact their profitability, which in turn could negatively impact our overall earnings and financial
position.
6. Our Dependence upon Interest-Bearing Liabilities and the Influence of Interest Rate Trends
In our business, we use bank debt in addition to our own capital, and our interest-bearing liabilities ratio as a percentage ofour total assets stood at 41.8% at end of fiscal year 2016. As for our Group, we are pursuing a strategy of reducing ourdependence upon interest-bearing liabilities, which includes the sale of some of our self-owned facilities to investors while
retaining the management and operational contracts for these facilities. At the end of fiscal year 2016, 82.9% of ourinterest-bearing liabilities had fixed interest rates and we therefore are insulated from near-term increases in interest rates.
However, our earnings still remain at risk of higher funding costs arising from increases in interest rates over the longer term.
2. Corporate Structure
The Kyoritsu Maintenance Group consists of the parent company, 14 subsidiaries, and 3 affiliated companies. Our main
businesses consist of dormitories, hotels, contracted services, food service, construction, and other business. The details of ourbusinesses and the services provided by our various subsidiaries and affiliates are listed below.
Business Segment
Business Description
Participating Companies
Dormitories
Student and corporate and outsourced dormitory management
Kyoritsu Maintenance Co., Ltd.
HotelsDormy Inn (Business hotels)
Kyoritsu Maintenance Co., Ltd.
Resort hotels
Kyoritsu Maintenance Korea Co., Ltd.
3 other companies
Contracted Services
Office building management business
Builnet Corporation
Residential property management businessCentral BuilWork Co., Ltd.
Food Services Business Restaurant business
Kyoritsu Foods Service Co., Ltd.
Outsourced catering business1 other company
Hotel restaurant outsourcing business
Construction Business

Construction, planning, design, brokerage, condominium sales,

Kyoritsu Estate Co., Ltd.

other related real estate development business
Other Businesses

Wellness Life Business (senior citizen residence management
and operations)
PKP business (consigned services business provided to regional
government bodies)
Single resident insurance and other lifestyle support services
Insurance services
Comprehensive human resources business
Financing business and administrative outsourcing services
Other related business

10

Kyoritsu Maintenance Co., Ltd.
Kyoritsu Trust Co., Ltd.
Japan Placement Center Co., Ltd.
Kyoritsu Financial Service Co., Ltd.
Kyoritsu Insurance Service Co., Ltd.
4 other companies

Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement
Schematic Diagram of Our Operations

Clients

Domestic

Building rental,
maintenanceCorporate benefit
facilities maintenanceReal estate brokerage,
related services

Dormy Inn, resort
maintenance outsourcing
Dormitory renovation,
Consigned maintenanceservices
Domeal facility
management

Builnet Co., Ltd.
Central BuilWork Co., Ltd.

Contracted services
business

Office building
management businessResidential building
management business

Consignment

Outsourced cafeteria andhotel restaurant management

Kyoritsu Foods Service Co., Ltd.
Restaurant, cafeteria
outsourcing andrestaurant management
services

Restaurant business
Cafeteria outsourcing

Food business

Hotel restaurant
outsourcing
Consignment

Kyoritsu Estate Co., Ltd.
Construction, planning,
design, brokerage
Real estate construction,
sales, brokerage

Construction business＜Hotel Business＞
Dormy Inn (business hotels)
Consignment

Kyoritsu Trust Co., Ltd.

Single resident lifestylesupport services＜Other Business＞

Other businessInsurance sales

Consignment

Labor dispatch,
headhunting services

Japan Placement Center Co., Ltd.
Other businessComprehensive personnel
services
Consignment

Collection andoperational services

Kyoritsu Financial Service Co., Ltd.
Other business
Loan businessResort hotels

Lifestyle product sales andother support services for
single residents in dormitories

Kyoritsu Insurance Service Co., Ltd

Labor dispatch,
headhunting＜Dormitory Business＞
Student, corporate dormitories, Domeal, outsourced
dormitory management

Construction, planning anddesign of dormitories

Condominium business
Other related business

Lifestyle product sales,
insurance business

Kyoritsu Maintenance Co., Ltd.

Loan business,
administrative support
services
Consignment

Overseas
Kyoritsu Maintenance Korea Co., Ltd.
Hotel Business

Dormy Inn
(Business Hotel) Business

Hotel Business

11

Senior Life(senior citizen attended care residence)
PKP business(Consigned services business provided to regional
government bodies)Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement
3. Management Policy(1) Our Basic Management Policy(2) Benchmarks of Our Intermediate to Long-Term Management Strategy(3) Key Management Issues
We do not make any comments in this section because there have been no important changes from the information disclosed
in our earnings announcement for the fiscal year ended March 2013 (Published on May 15, 2013).
For further information regarding the above-mentioned earnings announcement, please refer to the following URL.
(Kyoritsu Maintenance home page)
http://www.kyoritsugroup.co.jp/ir/library.html(Tokyo Stock Exchange home page: Search page for listed companies)
http://www.jpx.co.jp/listing/co-search/index.html
4. Basic Approach to Selecting Accounting Standards
The Group prepares its consolidated financial statements using Japanese standards, in consideraton of the ability to compare
periods in consolidated financial statements and make comparisons between companies.
The Group will respond appropriately to the adoption of IFRS in light of conditions in Japan and overseas.

12

Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement
5. Consolidated Financial Statements(1) Consolidated Balance Sheets

Previous Term
(March 31, 2015)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade
Real estate for sale
Real estate for sale in process
Costs on uncompleted construction contracts
Deferred tax assets
Other
Allowance for loan losses
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
LandConstruction in progress
Other
Accumulated depreciation
Other, net
Total property, plant and equipment
Intangible assets
Investments and other assets
Investment securities
Long-term loans receivable
Guarantee deposits
Lease deposits
Net defined benefit asset
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Deferred assets
Bond issuance cost
Total deferred assets
Total assets

13(Unit: million yen)
Current Term
(March 31, 2016)

16,115
6,841
1,007
706
514
791
5,504
(24)
31,45725,960
9,763
2,827
－
331
998
5,370
(19)
45,23153,760(20,760)
32,99928,704
8,943
8,948(7,329)1,618
72,265
1,818

59,601(23,263)
36,33733,807
6,906
9,962(7,772)
2,190
79,240
1,710

6,142
1,056
11,874
9,240
11
1,115
4,854
(189)
34,105
108,190

5,034
293
12,19910,103
2
1,189
6,492
(212)
35,103116,054103
103
139,750

116
116
161,402

Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement(Unit: million yen)
Current Term
(March 31, 2016)

Previous Term
(March 31, 2015)
Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term loans payable
Current portion of bonds
Income taxes payable
Advances received
Provision for bonuses
Provision for directors' bonuses
Provision for warranties for completed construction
Provision for point card certificates
Other
Total current liabilities
Non-current liabilities
Bonds payable
Convertible bond-type bonds with subscription
rights to shares
Long-term loans payable
Long-term guarantee deposited
Deferred tax liabilities
Net defined benefit liability
Director retirement benefit reserve
Provision for point card certificates
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets

14

5,238
15,7601,350
1,648
12,031
1,270
327
8
9
9,946
47,5906,966
21,471
1,350
2,765
11,079
1,700
426
8
18
7,861
53,648

6,950

5,600

7,253

20,60825,512
2,904
510
1,042
307
24
233
507
45,246
92,836

17,940
3,090
460
1,072
287
25
238
454
49,779103,428

5,136
9,313
32,670(1,109)46,011

7,654
12,50937,778(305)
57,637

747
120
34
902
46,913
139,750

736
(393)
(5)
336
57,974
161,402

Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement(2) Consolidated Income Statement and Comprehensive Income Statement(Consolidated Income Statement)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Salaries, allowances and bonuses
Welfare expenses
Provision for bonuses
Provision for directors' bonuses
Retirement benefit expenses
Director retirement reserve provisions
Promotion expenses
Commission fee
Provision of allowance for doubtful accounts
Provision for point card certificates
Business consignment expenses
Rent expenses
Depreciation
Other
Total selling, general and administrative expense
Operating income
Non-operating income
Interest income
Dividend income
Subsidy income
Deposit redemption income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Other
Total non-operating expenses
Ordinary income

15

Previous Term(April 1, 2014 toMarch 31, 2015)
110,21286,87423,338(Unit: million yen)
Current Term(April 1, 2015 toMarch 31, 2016)
135,053
107,189
27,863

3,973
764
344
327
42
2
1,852
4,335
1
20
1,263
313
183
1,694
15,120
8,217

4,228
886
537
426
51
1
2,225
5,023
22
12
1,295
323
171
2,413
17,61910,244

131
57
11
110
409
721

159
90
96
102
170
618

865
409
1,275
7,663

803
284
1,087
9,775

Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement(Unit: million yen)
Current Term(April 1, 2015 toMarch 31, 2016)

Previous Term(April 1, 2014 toMarch 31, 2015)
Extraordinary income
Gain on sales of investment securities
Compensation income
Gain on cancellation of leasehold contracts
Total extraordinary income
Extraordinary losses
Loss on sales of non-current assets
Impairment loss
Loss on store closing
Settlement funds
Other
Total extraordinary losses
Income before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit attributable to owners of parent

16

33
93
127

47
432
479

17
75
12
105
7,685
3,109
188
3,297
4,387
4,387

180
75
175
39
470
9,784
4,092
(278)
3,813
5,970
5,970

Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement(Consolidated Comprehensive Income Statements)

ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total other comprehensive income
Comprehensive income(Details)
Comprehensive income attributable to owners of parent

17

Previous Term(April 1, 2014 toMarch 31, 2015)
4,387(Unit: million yen)
Current Term(April 1, 2015 toMarch 31, 2016)
5,970

776
21
14
812
5,200

(10)
(514)
(40)
(565)
5,405

5,200

5,405

Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement(3) Consolidated Shareholders’ Equity Statements
Consolidated Figures for Fiscal Year Ended March 2015 (April 1, 2014 to March 31, 2015)(Unit: million yen)
Shareholders’ equity
Common stock
Balance as of start of current fiscal
year
Cumulative impact of changes
in the accounting policy
Balance at the beginning of thecurrent fiscal year reflectingchanges in the accounting policy
Increase (decrease) due to change
Issuance of new shares(exercise of subscription rights
to shares)
Dividends from surplus
Profit attributable to owners ofparentAcquisition of treasury stock
Sales of treasury stock
Items other than changes inshareholders’ equity, due tochange (net)Total change during fiscal year
Balance as of end of current fiscal
year

Capital surplus

5,136

Retained earnings

5,943

Treasury stock

28,892(5,471)

Total shareholders’equity34,500

55
5,136

5,943

28,94755(5,471)

34,556

－
(664)

(664)

4,387

4,387

3,369

(14)
4,377

(14)
7,747

-

3,369

3,722

4,362

11,455

5,136

9,313

32,670(1,109)46,011

Accumulated other comprehensive income
Net unrealized
gains on othersecurities
Balance as of start of current fiscal
year
Cumulative impact of changes
in the accounting policy
Balance at the beginning of thecurrent fiscal year reflectingchanges in the accounting policy
Increase (decrease) due to change
Issuance of new shares(exercise of subscription rights
to shares)
Dividends from surplus
Profit attributable to owners ofparentAcquisition of treasury stock
Sales of treasury stock
Items other than changes inshareholders’ equity, due tochange (net)Total change during fiscal year
Balance as of end of current fiscal
year

(29)

Retirement
benefit-related
adjustments

Translation
adjustments
99

Total accumulated
other comprehensive
income20

89

Total net assets

34,590
55

(29)

99

20

89

34,645

(664)
4,387
(14)
7,747
776

21

14

812

812

776

21

14

812

12,267

747

120

34

902

46,91318

Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement
Consolidated Figures for Fiscal Year Ended March 2016 (April 1, 2015 to March 31, 2016)(Unit: million yen)
Shareholders’ equity
Common stock
Balance as of start of current fiscal
year
Cumulative impact of changes
in the accounting policy
Balance at the beginning of thecurrent fiscal year reflectingchanges in the accounting policy
Increase (decrease) due to change
Issuance of new shares(exercise of subscription rights
to shares)
Dividends from surplus
Profit attributable to owners ofparentAcquisition of treasury stock
Sales of treasury stock
Items other than changes inshareholders’ equity, due tochange (net)Total change during fiscal year
Balance as of end of current fiscal
year

Capital surplus

5,136

Retained earnings

9,313

Total shareholders’equityTreasury stock

32,670(1,109)46,011
-

5,136

9,313

2,518

2,517

32,670(1,109)46,011

5,036
(863)

(863)

5,970

5,970

678

(127)
931

(127)
1,610

2,518

3,196

5,107

804

11,626

7,654

12,50937,778(305)

57,637

Accumulated other comprehensive income
Net unrealized
gains on othersecurities
Balance as of start of current fiscal
year
Cumulative impact of changes
in the accounting policy
Balance at the beginning of thecurrent fiscal year reflectingchanges in the accounting policy
Increase (decrease) due to change
Issuance of new shares(exercise of subscription rights
to shares)
Dividends from surplus
Profit attributable to owners ofparentAcquisition of treasury stock
Sales of treasury stock
Items other than changes inshareholders’ equity, due tochange (net)Total change during fiscal year
Balance as of end of current fiscal
year

747

Retirement
benefit-related
adjustments

Translation
adjustments
120

Total accumulated
other comprehensive
income34902

Total net assets

46,913
-

747

120

34

902

46,913

5,036
(863)
5,970
(127)
1,610
(10)

(514)

(40)

(565)

(565)

(10)

(514)

(40)

(565)

11,061

736

(393)

(5)

336

57,97419

Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement(4) Consolidated Cash Flow Statements(Unit: million yen)Previous Term FY3/15(April 1, 2014 toMarch 31, 2015)
Cash flow from operating activities
Income before income taxes
Depreciation

Current Term FY3/16(April 1, 2015 toMarch 31, 2016)

7,685

9,784

3,128

3,602

Amortization of long-term prepaid expenses

221

351

Amortization of guarantee deposits

224

200

Increase (decrease) in provision for bonuses

121

429

Interest and dividend income

(188)

(249)

Interest expenses

865

803

57

67

Loss (gain) on sales and retirement of
non-current assets
Loss on closing of stores－

75

Gain on cancellation of leasehold contracts

－

(432)

Settlement funds－

175(1,855)(2,923)(1,239)

(955)

1,329

1,729

260

653

939

(952)

994

(556)

340

197

(143)

(143)

75

180

Other

(929)

(216)

Subtotal

Decrease (increase) in notes and accounts
receivable – trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts
payable – trade
Increase (decrease) in accrued expenses
Increase (decrease) in advances received
Increase (decrease) in accrued consumption
taxes
Increase (decrease) in guarantee deposits
received
Increase (decrease) in unearned revenue
Impairment loss

11,888

11,822

Interest and dividend income received

135

197

Interest expenses paid

(863)

(806)

Income taxes refund

1

17

Income taxes paid

(3,481)(3,008)Cash flow from operating activities

7,679

8,222

(709)

(2)

Cash flow from investing activities
Purchase of securities
Proceeds from sales of securities
Purchase of property, plant and equipment
Proceeds from sales of property, plant andequipment
Purchase of intangible assets
Purchase of long-term prepaid expenses
Payments of loans receivable

1,566

1,159

(12,059)(13,255)

506

746

(75)

(155)

(305)

(406)

(2,226)(798)

Collection of loans receivable

2,694

1,539

Payments for lease and guarantee deposits(1,289)(2,268)Proceeds from collection of lease and guarantee
deposits
Purchase of insurance funds

99

417

(917)

(988)

Proceeds from cancellation of insurance funds

138

87

Other

560

(43)

(12,018)(13,971)

Cash flow from investing activities

20

Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement(Unit: million yen)Previous Term FY3/15(April 1, 2014 toMarch 31, 2015)

Current Term FY3/16(April 1, 2015 toMarch 31, 2016)

Cash flow from financing activities
Net increase (decrease) in short-term loans
payableProceeds from long-term loans payable

1,300

3,000

4,400

3,800

Repayments of long-term loans payable(9,528)(8,660)

Proceeds from issuance of bonds

1,967

19,966

Redemption of bonds(1,150)(1,350)Purchase of treasury shares

(14)

(127)

Cash dividends paid

(664)

(861)

Other

(70)

(58)

(3,760)15,708Cash flow from financing activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents

106

(114)

(7,991)

9,844

Cash and cash equivalents at beginning of period

23,75015,758Cash and cash equivalents at end of period

15,75825,60321

Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement(5) Consolidated Financial Statement Notes(Notes Regarding Going Concern Assumptions)Not applicable(Important articles in the assumption used to create consolidated financial statements)
1. Scope of Consolidation(1) Consolidated subsidiaries: 9 Companies
Kyoritsu Estate Co., Ltd.
Kyoritsu Trust Co., Ltd.
Kyoritsu Food Service Co., Ltd.
Japan Placement Center Co., Ltd.
Kyoritsu Financial Service Co., Ltd.
Builnet Co., Ltd.
Central BuilWork Co., Ltd.
Kyoritsu Maintenance Korea Co., Ltd.
Kyoritsu Insurance Service Co., Ltd.
(2) Non-Consolidated Subsidiaries: 5 Companies
Flat Co., Ltd.
Okinawa Kyoritsu Maintenance Co., Ltd.
Kyoritsu Assist Co., Ltd.
Ecofoods Co., Ltd.
Ryokan Okunobo(Reason for the exclusion from scope of consolidated accounts)
The assets, sales and net income of these non-consolidated companies only amount to a marginal amount of the total
consolidated accounts and are not considered to be important enough to be included in consolidated accounts.
(Segment Information)
1) Overview of Reported Segments
Financial information relating to the individual divisions of our business segments is readily available, and ourmanagement considers the validity of these segments on a regular basis during their board of directors’ meetings inassessing segment earnings and the allocation of business resources in accordance with these segments.
Our divisions and subsidiaries responsible for the various services within our Group are also responsible fordeveloping both strategies and business activities for their respective businesses.
Therefore, our segments are defined by the basic services provided by each of the divisions and subsidiaries and are
divided into five main segments including “dormitories,” “hotels,” “contracted services,” “food services,” and“construction.”
We provide an overview of our reported business segments as follows:
Dormitories: Dormitories provided to students and corporate employees, Domeal, management of outsourced
dormitories
Hotels: Dormy Inn business hotels, resort hotels
Contracted Services: Office building and residential property management services
Food Services: Restaurant business, management of outsourced cafeterias, hotel restaurants and other facilities
Construction: Planning, design and construction, real estate brokerage business, condominiums for sale, other related
services
2) Method of calculation for sales, income and losses, assets and other items of reported segments
Profits in the reported business segments are operating income.
Intersegment earnings and transfers are based on actual market pricing.

22

Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement
3) Sales, profits, assets and other information regarding reporting segments
Consolidated Figures for Fiscal Year Ended March 2015 (April 1, 2014 to March 31, 2015)(Unit: million yen)
Reporting Segments

Net sales
External sales
Intersegment
sales andtransfers
Total
OperatingincomeAssets

Other(Note 1)

Total

Adjustments(Note 2)

Values Usedin
Consolidated
Financial
Statements(Note 3)

Dormitories

HotelsContracted
Services

Food
Services

Construction

Subtotal

42,437

46,820

6,883

1,458

4,134

101,734

8,478

110,212－110,212

228

108

5,743

3,872

5,322

15,275393

15,668(15,668)－

42,66546,92912,626

5,330

9,456

117,0098,871

125,881(15,668)

110,212

6,371

4,736

376

(1)

277

11,760(748)

11,012(2,795)8,217

43,35057,084

11,505967

10,995

123,904

7,545

131,450

8,300

139,750

1,051

1,873

83

36

25

3,071

43

3,115

13

3,128

53

11

－

9

－

74

1

75

－

75

2,754

9,208

2,768

60

4

14,796437

15,233(206)

15,027

Other items
Depreciation
Impairment
loss
Change inproperty,plant
andequipment
andintangible
assets(Notes) 1. Other is not considered as a reporting business segment and is comprised of the wellness life (management of seniorcitizen housing), PKP business (consigned services business provided to regional government bodies), single life
support services, insurance agency business, comprehensive human resources, financing services and other related
services.
2. Details of adjustments are provided below(Unit: million yen)
Operating Income(262)(2,533)(2,795)Intersegment transaction cancelations
Companywide expenses (Note)
Total(Note) Companywide expenses represent the expenses associated with primarily finance and accounting, and otheroperations associated with the headquarters.
(Unit: million yen)Segment Assets(8,080)16,3808,300

Intersegment transaction cancelations
Companywide assets (Note)
Total(Note) Companywide assets represent cash and equivalents, marketable securities, investment securities, deferred taxes,
and other assets associated with the headquarters
3. Segment profits or losses are derived by adjusting the operating income used in the quarterly consolidated income
statement.

23

Kyoritsu Maintenance (9616), FYE March 2016 Earnings Announcement

Consolidated Figures for Fiscal Year Ended March 2016 (April 1, 2015 to March 31, 2016)(Unit: million yen)
Reporting Segments

Other(Note 1)

Total

Adjustments(Note 2)

Values Usedin
Consolidated
Financial
Statements(Note 3)

Dormitories

HotelsContracted
Services

Food
Services

Construction

Subtotal

44,16453,319

7,820

1,663

16,741

123,709

11,344135,053－

135,053

231

110

7,038

4,124

(428)

11,076442

11,519(11,519)－

44,39553,43014,8595,787

16,313

134,786

11,786

146,572(11,519)

135,053

6,574

6,006

508

(4)

677

13,762(212)

13,550(3,306)

10,244

44,461

66,14012,514

1,343

12,176

136,636

7,580

144,217

17,184

161,402

1,137

2,238

103

67

23

3,570

118

3,689

(86)

3,602

15

9

－

－

143

169

10

180

－

180

2,447

12,519

27

413

774

16,182

99

16,282(595)

15,686

Sales
External sales
Intersegment
sales and transfers
Total
OperatingincomeAssetsOther items
Depreciation
Impairment loss
Change in property,
plant and equipment
and intangible
assets(Notes) 1. Other is not considered as a reporting business segment and is comprised of the Senior Life (former Wellness Life)(management of senior citizen housing), PKP business (consigned services business provided to regional government bodies), single life
support services, insurance agency business, comprehensive human resources, financing services and other related services.
2. Details of adjustments are provided below(Unit: million yen)
Operating Income(247)(3,058)(3,306)

Intersegment transaction cancelations
Companywide expenses (Note)
Total(Note) Companywide expenses represent the expenses associated with primarily finance and accounting, and otheroperations associated with the headquarters.
(Unit: million yen)Segment Assets(7,647)
24,832
17,184

Intersegment transaction cancelations
Companywide expenses (Note)
Total(Note) Companywide assets represent cash and equivalents, marketable securities, investment securities, deferred taxes,
and other assets associated with the headquarters

3. Segment operating income is derived from adjustments made to the operating income of the consolidated
financial statements.
4. In addition to the above impairment loss, ¥0.39 million of impairment loss in food business is included inloss on store closing.

24Consolidated Income Statement
net sales
gross income
operating income
ordinary income
net income

3/06
63,084
11,783
4,611
4,823
2,010

3/07
66,287
12,242
3,745
3,787
2,413

3/08
75,60614,183
4,492
4,167
2,740

3/09
82,303
15,507
5,349
4,510
2,133

3/10
84,513
13,957
4,033
3,012
1,254

3/11
84,983
15,408
4,610
3,308
1,052

3/12
91,17017,863
6,017
4,602
2,376

3/13
99,472
19,910
6,521
5,599
3,206

3/14
105,216
21,524
7,490
6,796
3,829

3/15
110,21223,338
8,217
7,663
4,387

Units: million yen
3/16
3/17E
135,053 138,000
27,863na
10,244
11,500
9,775
11,0005,970
6,900

Consolidated Balance Sheetcurrent assets
fixed assets
total assets
current liabilities
fixed liabilities
total liabilities
net assets

23,35074,681
98,04744,03928,31672,35525,512

24,901
85,562
110,50737,342
46,06883,411
27,096

19,967
95,728
115,738
44,11944,07988,19927,53821,852
103,891
125,793
41,61555,26696,882
28,911

23,104
115,980
139,20941,49967,956
109,455
29,75336,783
104,428
141,31450,54660,600111,147
30,16628,234
97,319125,649
38,961
55,13594,09731,55130,852
91,335
122,259
38,892
48,58487,47634,78237,47394,434
131,995
40,81956,586
97,40534,59031,457108,190
139,750
47,59045,246
92,836
46,91345,231116,054
161,40253,64849,779103,428
57,974

na
na
na
na
na
na
na

yy change
net sales
gross income
operating income
ordinary income
net income

8.7%
8.2%
4.6%
9.3%
-14.2%

5.1%
3.9%-18.8%-21.5%
20.0%

14.1%
15.9%
19.9%
10.0%
13.6%

8.9%
9.3%
19.1%
8.2%
-22.2%

2.7%-10.0%-24.6%-33.2%-41.2%

0.6%
10.4%
14.3%
9.8%
-16.1%

7.3%
15.9%
30.5%
39.1%
125.7%

9.1%
11.5%
8.4%
21.7%
34.9%

5.8%
8.1%
14.9%
21.4%
19.4%

4.7%
8.4%
9.7%
12.7%
14.6%

22.5%
19.4%
24.7%
27.6%
36.1%

2.2%
na
12.3%
12.5%
15.6%

margins
gross margins
operating margins
ordinary margins
net margins

18.7%
7.3%
7.6%
3.2%

18.5%
5.7%
5.7%
3.6%

18.8%
5.9%
5.5%
3.6%

18.8%
6.5%
5.5%
2.6%

16.5%
4.8%
3.6%
1.5%

18.1%
5.4%
3.9%
1.2%

19.6%
6.6%
5.0%
2.6%

20.0%
6.6%
5.6%
3.2%

20.5%
7.1%
6.5%
3.6%

21.2%
7.5%
7.0%
4.0%

20.6%
7.6%
7.2%
4.4%

na
8.3%
8.0%
5.0%

other benchmarks
ROE
ROA
equity ratio

8.7%
2.1%
26.0%

9.2%
2.2%
24.4%

10.1%
2.4%
23.6%

7.6%
1.7%
22.8%

4.3%
0.9%
21.2%

3.5%
0.7%
21.3%

7.7%
1.9%
25.1%

9.7%
2.6%
28.4%

11.0%
2.9%
26.2%

10.8%
3.1%
33.6%

11.4%
3.7%
35.9%

na
na
na