February 6, 2020

Summary of Consolidated Financial Results
for the Third Quarter of the Fiscal Year Ending March 31, 2020
(Nine Months Ended December 31, 2019)[Japanese GAAP]
Listings: TSE First Section
Company name: AOKI Holdings Inc.
Stock code:
8214
URL: http://www.aoki-hd.co.jp/
Representative:
Akihiro Aoki, President
Contact:
Haruo Tamura, Executive Vice President
Tel: +81-45-941-1388
Scheduled date of filing of Quarterly Report:
February 7, 2020
Scheduled date of payment of dividend:
Preparation of supplementary materials for quarterly financial results: Yes
Holding of quarterly financial results meeting:
None
Note: The original disclosure in Japanese was released on February 6, 2020 at 15:00 (GMT +9).
(All amounts are rounded down to the nearest million yen)

1. Consolidated Financial Results for the Nine Months Ended December 31, 2019
(April 1, 2019 – December 31, 2019)(1) Consolidated results of operations(Percentages represent year-on-year changes)
Profit attributable toSales
Operating profit
Ordinary profit
owners of parent
Million yen%
Million yen%
Million yen%
Million yen%
Nine months ended Dec. 31, 2019
127,111(5.5)
937 (79.4)(99)(1,339)Nine months ended Dec. 31, 2018
134,453(2.5)
4,553 (13.2)
3,259 (28.5)
238 (89.3)
Note: Comprehensive income (million yen) Nine months ended Dec. 31, 2019:(1,605) (-%)
Nine months ended Dec. 31, 2018:(36) (-%)

Nine months ended Dec. 31, 2019
Nine months ended Dec. 31, 2018

Net income per share
Yen(15.62)
2.76

Diluted net income per share
Yen-(2) Consolidated financial position
Total assets
Net assets
Million yen
Million yen
As of Dec. 31, 2019
229,099
138,837
As of Mar. 31, 2019
232,056
145,671
Reference: Shareholders’ equity (million yen)
As of Dec. 31, 2019:
138,667

Equity ratio
%
60.5
62.7
As of Mar. 31, 2019: 145,595

2. Dividends
1Q-endYen

2Q-endYen

Dividend per share
3Q-endYen-

Year-end
Yen
31.00

Total
Yen

FY3/1929.00
FY3/2023.00
FY3/20 (forecasts)
23.00
Note: Revisions to the most recently announced dividend forecast: None
Breakdown of 2Q-end dividends for FY3/19: Ordinary dividends: 22.00 yen; Commemorative dividends: 7.00 yen
Breakdown of Year-end dividends for FY3/19: Ordinary dividends: 23.00 yen; Commemorative dividends: 8.00 yen

60.00
46.00

3. Consolidated Forecast for the Fiscal Year Ending March 31, 2020 (April 1, 2019 – March 31, 2020)
Sales

Operating profit

Ordinary profit

Million yen%
Million yen%
Million yen
192,500(1.3)
12,300(8.8)
11,300
Full year
Note: Revisions to the most recently announced consolidated forecast: None

%
(5.0)

(Percentages represent year-on-year changes)
Profit attributable to
Net income per shareowners of parent
Million yen
%
Yen
5,400
17.3
63.03

* Notes(1) Changes in consolidated subsidiaries during the period (changes in scope of consolidation): None
(2) Application of special accounting methods for presenting quarterly consolidated financial statements: None
(3) Changes in accounting policies and accounting-based estimates, and restatements
1) Changes in accounting policies due to revisions in accounting standards, others:None2) Changes in accounting policies other than 1) above:None3) Changes in accounting-based estimates:

None4) Restatements:

None(4) Number of shares outstanding (common shares)
1) Number of shares outstanding (including treasury stock) at the end of the period
As of Dec. 31, 2019:

90,649,504 shares

As of Mar. 31, 2019:

90,649,504 shares

As of Mar. 31, 2019:

4,724,330 shares

Nine months ended Dec. 31, 2018:

86,395,860 shares

2) Number of shares of treasury stock at the end of the period
As of Dec. 31, 2019:

5,345,666 shares

3) Average number of shares outstanding during the period
Nine months ended Dec. 31, 2019:85,784,575 shares

Note 1: The current quarterly summary report is not subject to quarterly review by certified public accountants or auditing firms.
Note 2: Cautionary statement with respect to forecasts and other matters
Cautionary statement with respect to forward-looking statements
Forecasts and forward-looking statements in these materials are based on assumptions judged to be valid and information
available to the Company at the time the materials were created. These materials are not promises by the Company regarding
future performance. Actual performance may differ significantly from these forecasts for a number of reasons. Please refer to“(3) Explanation of Consolidated Forecast and Other Forward-looking Statements” on page 4 of the attachments regarding
preconditions or other related matters for the forecast shown above.

AOKI Holdings Inc. (8214) Third Quarter of the Fiscal Year Ending March 31, 2020

Contents of Attachments

1. Qualitative Information on Quarterly Consolidated Financial Performance

Pages
2

(1) Explanation of Results of Operations

2(2) Explanation of Financial Position

3(3) Explanation of Consolidated Forecast and Other Forward-looking Statements

4

2. Quarterly Consolidated Financial Statements and Notes

5(1) Quarterly Consolidated Balance Sheet

5(2) Quarterly Consolidated Statement of Income andQuarterly Consolidated Statement of Comprehensive Income

7

Quarterly Consolidated Statement of Income

7

Quarterly Consolidated Statement of Comprehensive Income

8(3) Notes to Quarterly Consolidated Financial Statements

9

Going Concern Assumption

9

Significant Changes in Shareholders’ Equity

9

Additional Information

9

Segment and Other Information

9

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AOKI Holdings Inc. (8214) Third Quarter of the Fiscal Year Ending March 31, 2020

1. Qualitative Information on Quarterly Consolidated Financial Performance(1) Explanation of Results of Operations
In prior years, rent income of real estate and the rent cost of real estate were included in non-operating profit, selling,
general and administrative expenses, and non-operating expenses. Beginning with the first quarter of the current
fiscal year, rent income of real estate and the rent cost of real estate are instead included in sales and cost of sales.
Comparisons and analysis using results of operations in the first nine months of the previous fiscal year are based on
figures that have been restated to conform with this change.
In the first nine months of the current fiscal year, the Japanese economy continued to recover slowly due toimprovements in the labor market and personal income and other reasons. However, the economic outlook remains
unclear, in part due to signs of an economic slowdown, mainly because of uncertainty about global events andimpact of the October 2019 consumption tax hike.
The AOKI Group implemented various measures in all business segments as explained below. Sales decreased 5.5%
year-on-year to 127,111 million yen, operating profit decreased 79.4% to 937 million yen. There was an ordinary
loss of 99 million yen compared with a profit of 3,259 million yen one year earlier. Loss attributable to owners ofparent was 1,339 million yen compared with a profit of 238 million yen one year earlier.
Operating results by segment are as follows.
Fashion BusinessAs a new idea for a style of business apparel, AOKI launched a high-performance set-up suit called Active-Tech The
High Stretch Setup through collaboration with ORIHICA, and the Active-Tech series of business coats for men andwomen. In addition, AOKI redesigned the online shop for stronger links between e-commerce and physical stores.
During the first nine months, seven stores were opened and 51 stores were closed due to examinations of stores fromthe standpoints of profitability and AOKI’s dominant areas. These closings include stores closed for relocation andconversions to a café complex or other business format. As a result, there were 522 AOKI stores at the end of thethird quarter compared with 566 at the end of the previous fiscal year.
ORIHICA has started using the STAFF START app for the first time in the business suit industry in order to allow
personnel at stores to use the Internet to give people ideas about business apparel styles. During the first nine months,
one ORIHICA store was opened and nine stores were closed. As a result, ORIHICA had 123 stores at the end of thethird quarter compared with 131 at the end of the previous fiscal year.
Although many actions were taken during the first nine months, existing store sales were sluggish because of thechange in business apparel styles in Japan, the negative impact of the October 2019 consumption tax hike andunfavorable weather, including a warm winter. As a result, sales in this segment decreased 11.0% to 65,265 million
yen and there was an operating loss of 1,940 million yen compared with a 713 million yen loss one year earlier.
Anniversaire and Bridal Business
ANNIVERSAIRE INC., which operates guesthouse-style wedding and reception facilities, promoted TRENDCOLLECTIONS, a stylish and glamorous wedding format, and used Instagram and other social networking services
in order to attract customers. Despite these actions, the number of weddings was lower than one year earlier mainly
because of the smaller number of wedding and reception locations at this company and changing market conditions.
Sales decreased 10.7% to 17,802 million yen and operating profit decreased 58.0% to 747 million yen.
Entertainment Business
KAIKATSU CLUB, a chain of café complexes, completed renovations of 70 locations during the first nine months.
Improvements include a reconfigured booth layout, the addition of karaoke rooms, no-smoking booths and showers,
and other changes. In addition, cafés increased activities for meeting customers’ needs, such as by holding a
Yaki-Curry (curry casserole) Fair consisting of seasonal menu items. This business has started a new format that2

AOKI Holdings Inc. (8214) Third Quarter of the Fiscal Year Ending March 31, 2020combines a KAIKATSU CLUB with a FiT24 fitness center, which uses a self-service format and is open 24 hours.
The new format has been performing well by enabling customers to utilize the services and equipment of both a caféclub and fitness center.
In the COTE D’AZUR karaoke business, 16 locations were remodeled, karaoke units with the latest technologies
were installed and there were many special event campaigns in order to make existing locations more appealing. For
greater convenience, KAIKATSU CLUB and COTE D’AZUR customers can now use QR codes and bar codes whenpaying for merchandise and services.
During the first nine months, 69 KAIKATSU CLUBs and 24 FiT24 locations were opened as activities continue withthe goal of establishing café complexes as one of the AOKI Group’s core businesses. One COTE D’AZUR karaoke
location was closed. As a result, there were 591 stores in this business segment at the end of the third quartercompared with 499 at the end of the previous fiscal year.
Sales increased 6.9% to 43,140 million yen due to contributions from new facilities and strong existing-store sales.
Operating profit decreased 40.3% to 1,692 million yen due to higher expenses related to new store openings.
Real Estate Leasing Business
Segment sales increased 14.5% to 2,648 million yen mainly because of an increase in the subleasing of closed
properties in the fashion business and COTE D’AZUR karaoke business. Operating profit increased 2.1% to 512
million yen.
(2) Explanation of Financial Position
Balance sheet position
AssetsTotal assets at the end of the third quarter under review decreased 2,956 million yen from the end of the previous
fiscal year to 229,099 million yen due to seasonal factors.
Current assets decreased 10,028 million yen from the end of the previous fiscal year. There were decreases of 4,351
million yen in cash in hand and in banks due to the payment of income taxes among other reasons, and 5,988 million
yen in accounts receivable-trade due to seasonal factors. Fixed assets increased 7,071 million yen from the end of
the previous fiscal year as tangible fixed assets increased 7,157 million yen due to new store openings and otherfactors.
Liabilities
Current liabilities decreased 1,712 million yen from the end of the previous fiscal year. Short-term borrowings
increased 4,500 million yen, while there were decreases of 4,997 million yen in accounts payable-trade mainly due
to seasonal factors and 1,107 million yen in accrued bonuses for employees due to the payment of bonuses to
employees among other reasons. Long-term liabilities increased 5,588 million yen. There was an increase oflong-term borrowings of 3,591 million yen mainly due to a 6,000 million yen of new loan and scheduled repayment,
and an increase of 1,744 million yen in other long-term liabilities including lease obligations.
Net assets
Net assets decreased 6,833 million yen from the end of the previous fiscal year. There was a decrease of 5,977
million yen in retained earnings due to a loss attributable to owners of parent and dividend from surplus, and anincrease of 662 million yen in treasury stock due to stock repurchases.

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AOKI Holdings Inc. (8214) Third Quarter of the Fiscal Year Ending March 31, 2020

(3) Explanation of Consolidated Forecast and Other Forward-looking Statements
In the first nine months, sales were somewhat less than planned because of slow existing store sales in the fashion
business. Although there were cost-cutting measures at every AOKI Group business, operating profit in the first ninemonths is behind the pace needed to achieve the fiscal year forecast. Despite this performance in the first ninemonths, there are no revisions to the fiscal year forecast announced on November 7, 2019 mainly because the fourth
quarter is a large share of fiscal year sales and earnings in the fashion business. In the fashion business, there are
non-operating expenses for the disposal of fixed assets and other actions and an extraordinary loss for the
impairment of assets. These items are chiefly the result of a reexamination of dominant areas, a review of theefficiency of individual stores, and existing store business format conversions and closings.

4

AOKI Holdings Inc. (8214) Third Quarter of the Fiscal Year Ending March 31, 2020

2. Quarterly Consolidated Financial Statements and Notes(1) Quarterly Consolidated Balance Sheet
FY3/19(As of Mar. 31, 2019)(Millions of yen)
Third quarter of FY3/20(As of Dec. 31, 2019)

AssetsCurrent assets
Cash in hand and in banks

26,55822,206

Accounts receivable-trade

11,793

5,804

Inventories

25,574

26,104

Other current assets

9,061

8,840

Allowance for doubtful accounts

(38)

(35)

72,94862,920

Buildings and structures, net

60,93366,517

Land

36,94137,032

Total current assets
Fixed assets
Tangible fixed assets

Other, net

12,083

13,565

Total tangible fixed assets

109,958

117,116

5,932

5,828

Guarantee deposits

7,881

7,758

Leasehold deposit

20,536

20,560

Other investments and other assets

14,838

14,955Intangible fixed assets
Investments and other assets

Allowance for doubtful accounts

(40)

(40)

Total investments and other assets

43,21643,234

159,107

166,179

232,056

229,099

Total fixed assets
Total assets

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AOKI Holdings Inc. (8214) Third Quarter of the Fiscal Year Ending March 31, 2020

(Millions of yen)
Third quarter of FY3/20(As of Dec. 31, 2019)

FY3/19(As of Mar. 31, 2019)
Liabilities
Current liabilities
Accounts payable-trade18,162

13,164

Short-term borrowings

-

4,500

2,650

3,734

579

103

2,078

971

83

68

Other current liabilities

13,624

12,924

Total current liabilities

37,17735,46534,82538,416872

704

Retirement benefit liability

1,094

1,150

Asset retirement obligations

6,466

6,830

Current portion of long-term borrowings
Accrued income taxes
Accrued bonuses for employees
Accrued bonuses for directors and statutory auditors

Long-term liabilities
Long-term borrowings
Accrued costs for customer point program

Other long-term liabilities

5,949

7,694

Total long-term liabilities

49,20854,79686,38590,262

Share capital

23,282

23,282

Capital surplus

27,84627,823Retained earnings

100,488

94,511

Treasury stock(6,302)(6,965)

Total shareholders’ equity

145,315

138,652

Unrealized gain on securities

370

62

Remeasurements of defined benefit plans

(89)

(48)

Total accumulated other comprehensive income

280

14

75

170

Total liabilities
Net assets
Shareholders’ equity

Accumulated other comprehensive income

Stock acquisition rights
Total net assets
Total liabilities and net assets

6

145,671

138,837

232,056

229,099

AOKI Holdings Inc. (8214) Third Quarter of the Fiscal Year Ending March 31, 2020

(2) Quarterly Consolidated Statement of Income and Quarterly Consolidated Statement of Comprehensive
IncomeQuarterly Consolidated Statement of Income(For the Nine-month Period)First nine months of FY3/19(Apr. 1, 2018 – Dec. 31, 2018)(Millions of yen)First nine months of FY3/20(Apr. 1, 2019 – Dec. 31, 2019)

Sales

134,453

127,111

Cost of sales

78,82877,375Gross profit

55,62549,735

Selling, general and administrative expenses

51,071

48,797

Operating profit

4,553

937

69

59

Non-operating profit
Interest income
Dividend income

62

56

Other

171

158

Total non-operating profit

302

274

Interest expenses

227

209

Loss on disposal of fixed assets
Expenses for events to celebrate AOKI’s 60th
anniversary
Other

474

629

450

-

444

472

1,596

1,311

3,259

(99)

Non-operating expenses

Total non-operating expenses
Ordinary profit (loss)
Extraordinary gains
Gain on sale of fixed assets

160

55

Gain on sales of investment securities

27

100

Gain on reversal of stock acquisition rights

124

Total extraordinary gains

200

160

Extraordinary losses
Impairment loss

2,284

1,359

Loss on liquidation of subsidiaries and associates

444-

Loss on disaster

49

169

Loss on valuation of investment securities

-

72

2,777

1,601

Profit (loss) before income taxes

682(1,540)Current income taxes

483

565

Deferred income taxes

(39)

(765)

Total income taxes

444

(200)

Profit (loss)

238(1,339)Profit (loss) attributable to owners of parent

238(1,339)Total extraordinary losses

7

AOKI Holdings Inc. (8214) Third Quarter of the Fiscal Year Ending March 31, 2020

Quarterly Consolidated Statement of Comprehensive Income(For the Nine-month Period)First nine months of FY3/19(Apr. 1, 2018 – Dec. 31, 2018)(Millions of yen)First nine months of FY3/20(Apr. 1, 2019 – Dec. 31, 2019)238(1,339)

(324)

(307)

49

41

(275)

(266)

(36)

(1,605)(36)(1,605)--

Profit (loss)
Other comprehensive income
Unrealized gain on securities
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests

8

AOKI Holdings Inc. (8214) Third Quarter of the Fiscal Year Ending March 31, 2020

(3) Notes to Quarterly Consolidated Financial Statements
Going Concern Assumption
No reportable information.
Significant Changes in Shareholders’ Equity
First nine months of FY3/20 (Apr. 1, 2019 – Dec. 31, 2019)
Purchase of treasury stock
AOKI Holdings has purchased 700,000 shares of its treasury stock pursuant to the resolution of the Board of
Directors on August 13, 2019, and sold 82,000 shares for restricted stock compensation for directors pursuant to theresolution of the Board of Directors on June 27, 2019. As a result, treasury stock increased 662 million yen
including shares resulting from purchase of odd-lot shares during the first nine months of FY3/20 to 6,965 million
yen at the end of the third quarter of FY3/20.
Additional Information
Reclassifications
In prior years, rent income of real estate and the rent cost of real estate were included in non-operating profit, selling,
general and administrative expenses, and non-operating expenses. Beginning with the first quarter of the current
fiscal year, rent income of real estate and the rent cost of real estate are instead included in sales and cost of sales.
This change was made to more properly incorporate the real estate leasing business in the financial statements. Realestate leasing is now positioned as one of the major businesses of AOKI Holdings. Rent income of real estate is aconsistent source of earnings and more growth of this income is expected as the number of leased properties
increases. In addition, the profitability of this business has been properly managed by the relevant department.
Consolidated financial statements for the first nine months of the previous fiscal year have been restated to reflect
these reclassifications.
Accordingly, “rental income of real estate” under “non-operating profit” of 389 million yen, “rent cost of real estate”
under “non-operating expenses” of 307 million yen and real estate-related expenses, which was included in “selling,
general and administrative expenses,” of 22 million yen in the consolidated statement of income for the first ninemonths of the previous fiscal year has been reclassified. As a result, sales and cost of sales increased 846 million yen
and 787 million yen, respectively.
Segment and Other Information
First nine months of FY3/19 (Apr. 1, 2018 – Dec. 31, 2018)
1. Information related to sales and profit/loss for each reportable segment
Reportable segment
Anniversaire
Real EstateEntertainment
and Bridal
Leasing

Fashion

Total(Millions of yen)Amounts shown on
Adjustment quarterly consolidated(Note 1)statement of income(Note 2)

Sales
External sales
Inter-segment sales
and transfers
Total

73,311

19,92640,370846

134,453-

134,453

2

17

0

1,468

1,488

(1,488)-73,313

19,94440,3702,314

135,942(1,488)134,453

Segment profit (loss)
(713)
1,778
2,833
501
4,399
154
4,553
Notes: 1. The 154 million yen adjustment to segment profit (loss) includes 2,723 million yen in elimination for inter-segment
transactions, and -2,569 million yen in company-wide costs that cannot be allocated to any specific reportablesegments. Company-wide costs mainly include administration expenses of the Company that cannot be attributed toreportable segments.
2. Segment profit (loss) is adjusted with operating profit on the quarterly consolidated statement of income.

9

AOKI Holdings Inc. (8214) Third Quarter of the Fiscal Year Ending March 31, 2020

2. Information related to impairment losses on fixed assets, or goodwill, etc. for each reportable segment
Material impairment losses related to fixed assets
In the Fashion Business and the Entertainment Business, impairment losses were recognized for operating stores andsubleasing stores set to be closed, relocated or converted, or expected to remain in the red; impairment losses of 423
million yen and 1,859 million yen were booked respectively in the first nine months of FY3/19.
First nine months of FY3/20 (Apr. 1, 2019 – Dec. 31, 2019)
1. Information related to sales and profit/loss for each reportable segment
Reportable segment
Anniversaire
Real EstateEntertainment
and Bridal
Leasing

Fashion

Total(Millions of yen)Amounts shown on
Adjustment quarterly consolidated(Note 1)statement of income(Note 2)

Sales
External sales
Inter-segment sales
and transfers
Total

65,263

17,79343,140913

127,111-

127,111

1

8

0

1,735

1,745

(1,745)-65,26517,802

43,1402,648

128,856(1,745)

127,111

Segment profit (loss)(1,940)
747
1,692
512
1,011
(74)
937
Notes: 1. The -74 million yen adjustment to segment profit (loss) includes 3,158 million yen in elimination for inter-segment
transactions, and -3,232 million yen in company-wide costs that cannot be allocated to any specific reportablesegments. Company-wide costs mainly include administration expenses of the Company that cannot be attributed toreportable segments.
2. Segment profit (loss) is adjusted with operating profit on the quarterly consolidated statement of income.

2. Information related to impairment losses on fixed assets, or goodwill, etc. for each reportable segment
Material impairment losses related to fixed assets
In the Fashion Business, the Entertainment Business and the Real Estate Leasing Business, impairment losses wererecognized for operating stores and subleasing stores set to be closed, or converted, or expected to remain in the red;
impairment losses of 717 million yen, 434 million yen and 206 million yen were booked respectively in the first ninemonths of FY3/20.
3. Information related to revisions for reportable segments
In the first quarter of FY3/20, the Karaoke Facility Operations Business and Café Complex Operations Businesswere combined to reflect the reorganization of management and the increasing diversity of the operations. The
combined business was renamed the Entertainment Business.
As noted in the section “Additional Information, Reclassifications,” the business related to real estate leasing is
reclassified and presented as a separate segment titled “Real Estate Leasing Business.”
The segment information for the first nine months of FY3/19 is prepared and disclosed based on the reportablesegments after the revision.

* This financial report is solely a translation of “Kessan Tanshin” (in Japanese, including attachments), which has been
prepared in accordance with accounting principles and practices generally accepted in Japan, for the convenience of readers
who prefer an English translation.

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