August 7, 2018
TOKAI Holdings Corporation
Katsuhiko Tokita, President & CEO(Code No. 3167 Tokyo Stock Exchange First Section)
To whom it may concern

Financial Results for the First Quarter of the Fiscal YearEnding March 31, 2019
Steady progress toward first record profits in two years driven by higher earnings on previous year’s
successful investments to grow business
TOKAI Holdings Corporation (hereinafter, the “Company”) today announced its financial results forthe first quarter of the fiscal year ending March 31, 2019 (April 1, 2018 to June 30, 2018).

1. Off to a good start with double-digit growth (+14.3% year on year) in the netincrease in customer countIn May 2017, the Company announced its third medium-term management plan Innovation Plan 2020
“JUMP” and growth strategies to attain plan targets. This entails investing a total of 100 billion yen overfour years in M&A and aggressively pursuing an alliance strategy, in addition to making progress withexisting priorities such as increasing the number of continuing customers, securing multiple contracts
based on the “Total Life Concierge” (TLC) concept, and expanding service areas. The plan looks toroughly double the customer count, sales, and operating profit in the fiscal year ending March 31,
2021—the final year of the medium-term plan—versus the fiscal year ended March 31, 2017.
During the first quarter of the fiscal year ending March 31, 2019, the Company conducted upfront
spending continuing from the previous fiscal year and implemented an aggressive sales program toincrease customer count, which forms its earnings base, with a view to attaining its medium-term targets.
As a result, the continuing customer count reached 2,883 thousand as of June 30, 2018,
increasing by seven thousand from 2,876 thousand at the start of the fiscal year, making a goodstart toward the full-year target of a net increase of 64 thousand.
The net increase in the customer count broken down by main services was as follows: Gas (LP and citygas) 3,448 (versus a net increase of 2,879 in the first quarter of the fiscal year ended in March 31, 2018);
CATV 6,908 (versus a net increase of 4,930); and Aqua (bottled water delivery) 4,711 (versus a netincrease of 2,732). Overall, the net increase in the customer count exceeded the previous year’s level.

2. A double-digit increase (+11.0% year on year) in operating profit
In the first quarter of the fiscal year ending March 31, 2019, sales rose by 2.0 billion yen (+4.8% yearon year) to 44.6 billion yen on growth in customer count and the impacts of M&A conducted in theprevious fiscal year.

On the earnings front, although sales volume of household LP gas declined because of higher
temperature compared with the same period of the previous fiscal year, higher profits on an increase in
the number of monthly fee-paying customers accompanied by an overall rise in customer count and adecline in upfront spending such as customer acquisition costs resulted in a 200 million yen (+11.0%year on year) increase in operating profit to 2.4 billion yen.
Despite the decline in household LP gas sales, profits in the first quarter exceeded initial forecasts
thanks to higher-than-expected profits at CATV and Building and Real Estate businesses.
(Millions of yen)YoY

Q1 FY03/19 Results Q1 FY03/18 Results

Sales

44,55342,531+2,022

Percent
Change+4.8%

Operating profit2,390

2,152+237+11.0%

Recurring profit

2,487

2,204+283+12.9%

Quarterly net income

1,432

1,182+250+21.2%EPS (Yen)

10.94

9.33

+1.61

+17.3%(April 1, 2018 toJune 30, 2018)(April 1, 2017 toJune 30, 2017)

Change3. Targets record profits for the fiscal year ending March 31, 2019
In its consolidated earnings forecasts announced on May 8, 2018, the Company revealed its plan to post
first record profits for all profit categories in two years driven by the success of aggressive spending toincrease customer count in the previous fiscal year.
The Company expects a 2.1 billion yen increase in profits on growth in the number of monthly fee-paying
customers accompanied by efforts to increase customer count in the current and previous fiscal years.
Based on the expected profit growth coupled with a partial decline in special upfront costs recorded in
the previous fiscal year, the Company projects operating profit to increase by 3.0 billion yen year on year
to 14.0 billion yen.
The Company has made no revisions to its full-year consolidated earnings forecasts nor dividend
forecasts for the fiscal year ending March 31, 2019.
Under its policy of consistently providing stable dividends, the Company plans to pay an annual dividendof 28 yen per share.
(Millions of yen)
FY03/19 Forecast

FY03/18 Results(April 1, 2018 toMarch 31, 2019)(April 1, 2017 toMarch 31, 2018)

YoY

Sales

195,600

186,069+9,531

Percent
Change+5.1%

Operating profit

13,96010,971+2,989+27.2%

Recurring profit

13,88011,191+2,689+24.0%Net income

7,920

6,620

+1,300+19.6%EPS (Yen)

60.48

51.19+9.30+18.2%

ChangeFY03/19 (Forecast)FY03/18

End of Q2 (Yen)

14.00

14.00

Year-end (Yen)

14.00

14.00

Annual dividend total (Yen)

28.00

28.00

Consolidated payout ratio—54.7%For details, please see the attached materials, entitled “Financial Results for the First Quarter of theFiscal Year Ending March 31, 2019.”
Further, for the Company’s earnings announcement for the first quarter of the fiscal year ending March
31, 2019, please see the following URL: http://tokaiholdings.co.jp/english/ir/library/earnings.html.

Contact: Yoshihiro Taniguchi
Public Relations and Investor Relations OfficeTEL: +81-(0)3-5404-2891
Email: overseas_IR@tokaigroup.co.jp

Financial Results for the First Quarter of theFiscal Year Ending March 31, 2019
TOKAI Holdings Corporation(Code: 3167)
August 7, 2018

Net increase in customer count up
by double-digit YoY◎ Q1 saw a net increase in customer count of 6,980, up 14.3% YoY.
◎ Main LP Gas and CATV businesses significantly contributed to the increase in customer count.
◎ From Q2 onward, TOKAI plans to accelerate the net growth in customer count to achieve an annual
net increase of 64,000 (up 62% YoY).
Of which:
Thousands of customers

LP Gas+35,764

CATV+28,839+64Of which:
LP Gas+3,428

CATV+6,908+39+25+18+7+6+39+27+13+7Q1

Q2

1H
FY03/17*Excludes increase in customer count due to M&A

2H
FY03/18

Full-year

1

Double-digit increase in all profit categories YoY◎ Continued upfront spending led to a steady increase in customer count, the group’s earnings base.
◎ Posted higher sales on the effects of M&A conducted in FY03/18 in addition to growth in customercount◎ A double-digit increase in profits on the rise in the number of monthly fee-paying customers
accompanied by an overall increase in customer count and reduction in upfront expenses such ascustomer acquisition costs
Millions of yen

Q1 FY03/19
Results

Q1 FY03/18
Results(April 1, 2018 toJune 30, 2018)(April 1, 2017 toJune 30, 2017)

YoY
ChangePercent Change

44,55342,531+2,022+4.8％

Operating profit

2,390

2,152+237+11.0％

Recurring profit

2,487

2,204+283+12.9％

Net income

1,432

1,182+250+21.2％EPS (Yen)

10.94

9.33

+1.61+17.3％Sales

2Targets record profits in FY03/19◎ Plans to post first record profits for all profit categories in two years with the success of aggressive
investments to expand customer base in FY03/18◎ Expects a 2.1 billion yen increase in profits on an increase in the number of monthly fee-paying
customers owing to efforts to increase customer count in the current and previous fiscal years, andprojects a further increase of 3.0 billion yen in profits on reduced upfront spending
Millions of yenYoY

FY03/19 Forecasts FY03/18 Results(April 1, 2018 toMarch 31, 2019)(April 1, 2017 toMarch 31, 2018)

ChangePercent Change

195,600

186,069+9,531+5.1％

Operating profit

13,96010,971+2,989+27.2％

Recurring profit

13,88011,191+2,689+24.0％Net income

7,920

6,620

+1,300+19.6％EPS (Yen)

60.48

51.19

+9.30

+18.2％

Sales

3

Policy of consistently providing stable dividends◎ No change was made to the dividend forecasts (announced May 8, 2018).
◎ Plans to pay an annual dividend of 28 yen per share

28 yenper share30

per share

28 yenper share

14141414

FY03/18

FY03/19(Forecast)

625201528 yen

12 yen12 yen12 yen12 yen14 yenper share
8per shareper shareper shareper share

6666101111566666

FY03/12

FY03/13

FY03/14

FY03/15

FY03/160Interim dividend

Year-end dividend

FY03/17

Commemorative dividend

4Appendix(1) Consolidated results(2) Sales by segment(3) Operating profit by segment(4) Consolidated financial indicators(5) Consolidated cash flows(6) Group customer count(1) Consolidated results(Millions of yen)

Q1 FY2013
ResultsQ1 FY2014
Results

Q1 FY2015
Results

Q1 FY2016
Results

Q1 FY2017
Results

Q1 FY2018
Results

43,03844,302

42,672

41,61842,531

44,553Operating profit

648

1,657

1,708

2,870

2,152

2,390

Recurring profit

549

1,547

1,649

2,900

2,204

2,487

Quarterly net
income

149

713

714

1,766

1,182

1,432

EPS (Yen)

1.31

6.21

6.18

15.60

9.33

10.94

Sales

6(2) Sales by segment(Millions of yen)

Q1 FY2013
Results

Q1 FY2014
Results

Q1 FY2015
Results

Q1 FY2016
Results

Q1 FY2017
Results

Q1 FY2018
Results

21,94022,51320,288

17,47917,392

17,608

Information andCommunications

9,414

9,659

9,826

11,78012,447

12,513

CATV

5,970

6,070

6,074

6,241

6,406

7,511

Building and Real
Estate

3,419

3,728

4,012

3,414

3,617

4,166

Aqua

942

1,123

1,320

1,424

1,456

1,653

Others

1,350

1,207

1,149

1,277

1,211

1,100

43,03844,302

42,672

41,61842,531

44,553

Gas andPetroleum

Total

7

(3) Operating profit by segment(Millions of yen)

Q1 FY2013
Results

Q1 FY2014
Results

Q1 FY2015
Results

Q1 FY2016
Results

Q1 FY2017
ResultsQ1 FY2018
Results

1,049

1,494

1,865

2,197

1,324

1,182

Information andCommunications

826

1,333

691

913

774

724

CATV

377

503

498

717

875

1,194

Building and Real
Estate

135

31

63

81

90

213

Aqua

-523

-511

-227

1956

96

Others,adjustments-1,216-1,193-1,182-1,060-969-1,022

Total

648

1,657

1,708

2,870

2,152

2,390

Gas andPetroleum*Prior to elimination of indirect expenses

8(4) Consolidated financial indicators(Millions of yen)

Q1 FY2013
Results

Q1 FY2014
Results

Q1 FY2015
Results

Q1 FY2016
ResultsQ1 FY2017
Results

Q1 FY2018
Results

Total assets

171,202167,262

164,163

155,595

157,498

162,694

Total liabilities

137,619

128,734

120,110113,074

101,987

101,736

Total net assets

33,582

38,52844,05342,521

55,511

60,957

Balance ofinterest-bearing
debt

90,176

81,16873,461

67,061

54,96652,604

EBITDA

5,040

6,031

5,898

6,760

5,948

6,032

Equity ratio

19.1 %

22.5 %

26.3 %

26.8 %

34.7 %

36.8 %
9

(5) Consolidated cash flows(Millions of yen)

Q1 FY2013
Results

Q1 FY2014
Results

Q1 FY2015Results

Q1 FY2016
Results

Q1 FY2017
Results

Q1 FY2018
Results

Operating cash
flow

7,725

8,080

4,285

8,242

4,851

4,348

Investment cash
flow

-3,407-1,844-3,162-2,454-2,870-3,484

Free cash flow

4,318

6,235

1,123

5,787

1,981864

Financing cashflow

-5,368-6,449-1,261-6,216-2,262-1,159

10(6) Group customer count(Millions of yen)

Q1 FY2013
Results

Q1 FY2014
Results

Q1 FY2015
Results

Q1 FY2016
Results

Q1 FY2017
Results

Q1 FY2018
Results

629627625634645664

Previous ISPmodel, etc.

834

858

802

595

507

451

HikariCollaboration

－－

58

251

310

327

LIBMO－－－－

832

Mobile

217

229

235

235

232

225

1,049

1,087

1,095

1,081

1,057

1,035

CATV

693

692

692

716

738

1,039

Aqua

105

126

130

134

138

151

Security

19

18

18

17

17

17

2,471

2,526

2,537

2,557

2,570

2,883
11Gas (LP and city gas)

Information andCommunications

Subtotal

Total*The number of customers under a thousand are rounded to the nearest thousand. Information and Communications andCATV both offer communications services, and so their numbers are excluded from total figures.

The performance forecasts and forward-looking statements in these materials are
based on information currently available to the company, and include potential risks anduncertainties. Please be aware that due to changes in a variety of factors, actual results
may differ materially from the projections and other forward-looking statements in thesematerials.

Please contact us with any questions regarding these materials.
Investor Relations Office
TOKAI Holdings Corporation
Hamarikyu InterCity 11th floor, Kaigan 1-9-2, Minato-Ku, Tokyo, 105-0022, Japan
Phone: +81- (0)3-5404-2891
Fax: +81- (0)3-5404-2786
http://tokaiholdings.co.jp/english/
e-mail： overseas_IR@tokaigroup.co.jp