January 30, 2017

Third Quarter Earnings Report for Fiscal 2016, Ending March 31, 2017
[Japanese Standards] (Consolidated)
Company name:Securities code:
Representative:

Ryosan Company, Limited
Stock listing: First Section, Tokyo Stock Exchange
8140
URL http://www.ryosan.co.jp
Naoto Mimatsu, President and Representative Director
TEL:
Masahide Nishiura, Director and Senior Executive Officer
Inquiries:
General Manager, Finance and Accounting Headquarters+81-3-3862-2591
Scheduled filing date of quarterly earnings report:
February 14, 2017
Scheduled payment date of dividend:―
Supplementary materials for the quarterly financial results:
None
Investor conference for the quarterly financial results:
None(Millions of yen rounded down)

1. Consolidated results for the first three quarters of fiscal 2016 (April 1, 2016 to December 31, 2016)(1) Consolidated operating results (Cumulative)(% change compared with same period of previous fiscal year (YoY))
Profit attributable toOperating income
Ordinary income
owners of parent

Net sales
Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

159,299

(9.5)

3,604

(19.0)

3,464(19.0)

2,370(22.5)

175,947(0.4)
4,447(Note) Comprehensive income
First Three Quarters, Fiscal 2016: 2,794 million yen (24.8%)
First Three Quarters, Fiscal 2015: 2,239 million yen (-61.3%)

(1.1)

4,278

7.0

3,059

26.1

First Three Quarters, Fiscal 2016
First Three Quarters, Fiscal 2015

Basic earnings per
share

Diluted earnings per
share

Yen

First Three Quarters, Fiscal 2016
First Three Quarters, Fiscal 2015

Yen

81.58
98.86

―
―

(2) Consolidated financial position
Total assets

Net assets

Net assets to total assets

Millions of yen

Millions of yen%

December 31, 2016
161,663
March 31, 2016
157,011(Reference) Shareholders’ equity
December 31, 2016: 109,173 million yen
March 31, 2016: 115,362 million yen

109,173
115,36267.5
73.5

Net assets per shareYen

3,877.05
3,915.04

2. Dividends
Dividends per share (Yen)End of 1Q
Yen

Fiscal 2015―
Fiscal 2016―
Fiscal 2016 (Forecast)(Note) Revision of dividend forecasts: None

End of 2Q

End of 3Q

Yen

45.00
70.00

Yen

―
―

Annual

Total
Yen

Yen

95.00

140.0070.00

140.00As stated in the "Notice Concerning Revision of Dividend Forecast" released on July 11, 2016, Ryosan Company
Limited (Ryosan)'s basic dividend policy is to pay an ordinary dividend of 90 yen per share and a special dividend of
50 yen or more per share, resulting in a total dividend of 140 yen or more per share for the fiscal year ending March
31, 2017.

Fiscal 2015

Year-end dividend breakdown:

45 yen (ordinary), 50 yen (special)

Fiscal 2016

Interim dividend breakdown:

45 yen (ordinary), 25 yen (special)

Fiscal 2016

Year-end dividend breakdown (forecast):45 yen (ordinary), 25 yen (special) or more

3. Forecast of results for the fiscal 2016 (April 1, 2016 to March 31, 2017)
Net sales
Millions of yen(% figures represent year-on-year increase or decrease)
Basic
Profit attributable toearnings per
Ordinary income
owners of parent
share

Operating income%

Millions of yen

Full Fiscal Year
215,000(5.8)(Note) Revision of financial results forecasts: None

4,400

%

Millions of yen%

Millions of yen%(20.6)

4,900(12.4)

3,600

(1.9)

Yen

123.78* Notes(1) Transfer of major subsidiaries during the scope of consolidation of these nine months ended December 31, 2016 (transfer of
specified subsidiaries in line with changes in the consolidated range): NoneNew:

－ (Company name:)

Excluded:－ (Company name:)(2) Application of accounting procedures specific to preparing quarterly financial statements: None
(3) Changes in accounting principles, changes in accounting estimates, and restatements
1) Changes in accordance with revisions to accounting standards and related practices of accounting principles: Yes
2) Changes in items of accounting principles other than 1) above: None
3) Changes in accounting estimates: None
4) Restatements: None
(4) Number of shares issued and outstanding (common shares)
1. Total number of shares issued andoutstanding (including treasury shares) at theDecember 31, 2016

31,500,000 shares

March 31, 2016

31,500,000 shares

December 31, 2016

3,341,008 shares

March 31, 2016

2,033,462 sharesperiod-end:
2. Total number of treasury shares at theperiod-end:
3. Average number of shares outstanding
during the period (Cumulative total for thequarterly consolidated period)First three quarters,
Fiscal 2016

First three
29,058,375 sharesquarters, Fiscal

30,942,613 shares

2015

Indication regarding the implementation status of the quarterly review procedure
This quarterly consolidated earnings report is not subject to the quarterly review procedures pursuant to the Financial Instruments andExchange Act. As of the disclosure of this earnings report, the procedures for reviewing quarterly financial statements pursuant to the
Financial Instruments and Exchange Act are in progress.
Caution with respect to forward-looking statements:(Notes on forward-looking statements)
The estimates referred in this report are based on the information available as of the date of this release. Ryosan does not promise therealization of the estimates in this report. The actual results could significantly differ from the estimates due to a variety of factors. For
details on the conditions that form the assumptions used for earnings forecasts and notes on using earnings forecasts, please refer toappendix page 2, “1. Qualitative Information Regarding this Quarterly Statement (3) Qualitative Information Concerning Consolidated
Forecast and Other Future Predictions.”

○Table of contents of the appendix
1. Qualitative Information Regarding this Quarterly Statement ........................................................................................................... 2(1) Qualitative Information Concerning Consolidated Operating Results .................................................................................. 2(2) Qualitative Information Concerning Consolidated Financial Position .................................................................................. 2(3) Qualitative Information Concerning Consolidated Forecast and Other Future Predictions .................................................. 2
2. Items Regarding Summary Information (Notes) .............................................................................................................................. 3(1) Transfer of Major Subsidiaries during the Scope of Consolidation of this Quarter ............................................................... 3(2) Applying Accounting Procedures Specific to Preparing Quarterly Financial Statements...................................................... 3(3) Changes in Accounting Principles, Changes in Accounting Estimates, and Restatements .................................................... 3
3. Consolidated Quarterly Financial Statements .................................................................................................................................. 4(1) Consolidated Quarterly Balance Sheet .................................................................................................................................. 4(2) Consolidated Quarterly Statement of Income and Consolidated Quarterly Statement of Comprehensive Income ............... 6
Consolidated Quarterly Statement of Income
Scope of Consolidation of these First Three Quarters ................................................................................................ 6
Consolidated Quarterly Statement of Comprehensive Income
Scope of Consolidation of these First Three Quarters ................................................................................................ 7(3) Notes Regarding Consolidated Quarterly Financial Statements............................................................................................ 8(Notes Regarding Going Concern)........................................................................................................................................ 8(Notes Regarding Substantial Changes in Shareholders’ Equity).......................................................................................... 8(Segment Information) .......................................................................................................................................................... 8
4. Supplementary Information ............................................................................................................................................................. 9(1) Geographical Segment Information ...................................................................................................................................... 9(2) Overseas Sales....................................................................................................................................................................... 10-1-

1. Qualitative Information Regarding this Quarterly Statement(1) Qualitative Information Concerning Consolidated Operating Results1) Overview
During this nine-month consolidated period (April 1, 2016 to December 31, 2016), the global economy on thewhole grew at a sluggish pace; a gradual recovery continued in the United States, but uncertainty surrounding theEuropean economy intensified, and growth slowed in China and other emerging countries. In Japan, indices such as
capital investment and personal consumption did not show signs of robust recovery in spite of economic policies
by the government and a negative interest rate policy by the Bank of Japan, and as the result, economic recovery
continued to be at the state of standstill.
The electronics industry lacked momentum for growth as a whole, due to shrinking of the PC and tablet market
and deceleration of growth in the smartphone market, even though it continued to see strong sales in the fields ofthe products for automobiles and FA equipment.
FY2016 is the third fiscal year for the 9th Medium-Term Business Plan (FY2014-FY2017) through which
Ryosan is pursuing business model shifts, by coping with changes in its business environment, and pursuing
growth in a sustainable manner. To realize this plan, Ryosan is focusing on rebuilding its growth path andenhancing capital efficiency. However, the results were adversely affected by the recent strong yen rates and theaggravation of the balance of demand and supply of the electronics market on the whole.
As the result, Ryosan reported net sales of 159,299 million yen (down 9.5% from the same period last fiscal
year), operating income of 3,604 million yen (down 19.0%), ordinary income of 3,464 million yen (down 19.0%),
and profit attributable to owners of parent of 2,370 million yen (down 22.5%) for this nine-month consolidation
period.
2) Business Segment Informationa. Semiconductors
Ryosan sells memories, system LSIs and discrete semiconductors, and develops system LSIs. In thisnine-month consolidation period, sales decreased, with net sales of 91,994 million yen (down 9.6% from thesame period last fiscal year), and operating income of 1,942 million yen (down 12.5%), mainly because of theappreciation of yen, slowdown of the information and communication equipment business, and sluggish sales ofcar-navigation systems and car-audios.
b. Electronic Components
Ryosan sells display devices, power supplies and electromechanical components. In this nine-monthconsolidation period, sales increased, with net sales of 50,597 million yen (up 2.9% from the same period last
fiscal year), and operating income of 1,467 million yen (up 16.2%) despite of the appreciation of yen, thanks tostrong performance in the in-vehicle electrical equipment business.
c. Electronic Equipment
Ryosan sells systems equipment and facilities equipment. In this nine-month consolidated period, sales
decreased, with net sales of 16,707 million yen (down 33.1% from the same period last fiscal year), andoperating income of 491 million yen (down 58.0%), mainly due to reaction after the conclusion of Multi
Function Peripheral business.
(2) Qualitative Information Concerning Consolidated Financial Position
As of the end of this third quarter, total assets increased by 4,652 million yen, as compared with the level at theend of the previous fiscal year, and came to 161,663 million yen.
Also, net assets decreased by 6,188 million yen, as compared with the level at the end of the previous fiscal year,
and came to 109,173 million yen, with the ratio of net assets to total assets being 67.5%.
(3) Qualitative Information Concerning Consolidated Forecast and Other Future Predictions
There is no change in forecasts for the full fiscal year ending March 31, 2017 (announced on October 31, 2016).

-2-2. Items Regarding Summary Information (Notes)(1) Transfer of Major Subsidiaries during the Scope of Consolidation of this Quarter
None(2) Applying Accounting Procedures Specific to Preparing Quarterly Financial Statements
None(3) Changes in Accounting Principles, Changes in Accounting Estimates, and Restatements
Changes in Items of Accounting Principles
Implementation of Practical Solutions on Accounting for Changes in the Depreciation Method Associated with
Revisions to the FY2016 Tax Law
In accordance with revisions to the Corporate Tax Law, Ryosan has adopted the “Practical Solutions on
Accounting for Changes in the Depreciation Method Associated With Revisions to the FY2016 Tax Law”
(Practical Issues Task Force No. 32 issued on June 17, 2016), effective from the consolidated first quarter ofcurrent term, and accordingly changed the depreciation method for facilities attached to buildings and forstructures acquired on or after April 1, 2016, from the declining balance method to the straight-line method.
There was only minor impact on operating income, ordinary income and quarterly profit before income taxes
during this nine-month consolidation period.

-3-3. Consolidated Quarterly Financial Statements(1) Consolidated Quarterly Balance Sheet(Millions of yen)
Fiscal Year Ended
March 31, 2016
(As of March 31, 2016)

Third Quarter of the Fiscal
Year Ending March 31, 2017
(As of December 31, 2016)

ASSETS
Current assets
Cash and deposits

50,76837,173

Notes and accounts receivable–trade64,65472,070

Securities

-

3,300

Inventories

22,227

24,074

Accounts receivable–other

736

6,126

Deferred tax assets

578

246

Other

261

672

Allowance for doubtful accounts

(41)

(71)

139,185

143,592

Buildings and structures, net

3,506

3,429

Land

6,489

6,428

Leased assets, net

272

568

Other, net

167

146

10,436

10,572

1,086

1,160

Investment securities

4,335

4,527

Deferred tax assets

141

154

Other

1,950

1,794

Allowance for doubtful accounts

(124)

(138)

Total investments and other assets

6,302

6,338

17,826

18,071

157,011

161,663

Total current assets
Non-current assets
Property, plant and equipment

Total property, plant and equipment
Intangible assets
Investments and other assets

Total non-current assets
Total assets-4-

(Millions of yen)
Fiscal Year Ended
March 31, 2016
(As of March 31, 2016)

Third Quarter of the Fiscal
Year Ending March 31, 2017
(As of December 31, 2016)

LIABILITIESCurrent liabilities
Accounts payable - trade

24,88632,910

Short-term loans payable

10,785

13,249Lease obligations

124

161

Accounts payable - other

770

1,685

1,130

502

Income taxes payable

951

130

Provision for bonuses

-

334

419

534

39,07049,509Lease obligations

188

473

Deferred tax liabilities

282

439

Net defined benefit liability

2,020

1,980

Asset retirement obligations

33

34

Other

53

53

2,578

2,980

41,64852,489

Capital stock

17,69017,690Capital surplus

19,114

19,114Retained earnings

82,66980,221

Treasury shares(6,119)(10,284)

Total shareholders’ equity

113,354

106,742

1,375

1,546

Deferred gains or losses on hedges(3)0Foreign currency translation adjustment

646

904

Remeasurements of defined benefit plans

(9)

(20)

2,008

2,431

Total net assets

115,362

109,173

Total liabilities and net assets

157,011

161,663

Accrued expenses

Other
Total current liabilities
Non-current liabilities

Total non-current liabilities
Total liabilities
NET ASSETS
Shareholders’ equity

Accumulated other comprehensive income
Valuation difference on available-for-sale securities

Total accumulated other comprehensive income-5-(2) Consolidated Quarterly Statement of Income and Consolidated Quarterly Statement of Comprehensive Income(Consolidated Quarterly Statement of Income)(Scope of Consolidation of these First Three Quarters)(Millions of yen)

Net sales
Cost of Sales
Gross Profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Miscellaneous income
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Miscellaneous loss
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of non-current assets
Total extraordinary income
Extraordinary losses
Impairment loss
Loss on sales of investment securities
Loss on valuation of golf membership
Loss on quality compensation
Total extraordinary losses
Profit before income taxes
Income taxes
ProfitProfit attributable to owners of parent

First Three Quarters of the Fiscal
Year Ended March 31, 2016
(Apr. 1, 2015 to Dec. 31, 2015)
175,947
161,274
14,673
10,225
4,447First Three Quarters of the Fiscal
Year Ending March 31, 2017
(Apr. 1, 2016 to Dec. 31, 2016)
159,299
145,689
13,60910,005
3,604

44
68
119
232

43
69
152
265

101
181
119
402
4,278

100
271
33
405
3,464

137
137

-

122
24
146
4,268
1,209
3,059
3,059

1
57
59
3,404
1,034
2,370
2,370

-6-

(Consolidated Quarterly Statement of Comprehensive Income)(Scope of Consolidation of these First Three Quarters)(Millions of yen)

ProfitOther comprehensive income

First Three Quarters of the Fiscal
Year Ended March 31, 2016
(Apr. 1, 2015 to Dec. 31, 2015)
3,059

First Three Quarters of the Fiscal
Year Ending March 31, 2017
(Apr. 1, 2016 to Dec. 31, 2016)
2,370

(53)
(1)
(737)
(26)
(819)
2,239

171
4
258
(10)
423
2,794

2,239

2,794

Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Reassessments of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income(Comprehensive income attributable to)Comprehensive income attributable to owners ofparent-7-

(3) Notes Regarding Consolidated Quarterly Financial Statements(Notes Regarding Going Concern)
None(Notes Regarding Substantial Changes in Shareholders’ Equity)
None(Segment Information)
I. For the consolidated first three quarters of the fiscal year ended March 31, 2016
(April 1, 2015 to December 31, 2015)
Information Concerning Sales and Income or Loss Amount by Reporting Segment(Millions of yen)
Reporting Segment

Amounts shown on
consolidated quarterly
statement of income(Note 2)

Electronic
Components

Electronic
Equipment

Total

101,800

49,18324,963

175,947―

175,947

―

―

―

―

―

―

101,800
2,219

49,183
1,263

24,963
1,169

175,947
4,652

―
(204)

175,947
4,447

Semiconductors
Net sales
Sales to external customers
Internal sales or exchange
between segments
Total
Segment income (loss)

Adjusted
amount(Note 1)

(Notes)1. The adjustment of -204 million yen to segment income represents corporate expenses that are not allocated to eachreporting segment. Corporate expenses mainly refer to general and administrative expenses not belonging to any reporting
segments.
2. Segment income has been adjusted with operating income in consolidated quarterly statement of income.

II. For the consolidated first three quarters of the fiscal year ending March 31, 2017
(April 1, 2016 to December 31, 2016)
Information Concerning Sales and Income or Loss Amount by Reporting Segment(Millions of yen)
Reporting Segment

Amounts shown on
consolidated quarterly
statement of income(Note 2)

Electronic
Components

Electronic
Equipment

Total

91,99450,597

16,707

159,299―

159,299

―

―

―

―

―

―

91,994
1,942

50,597
1,467

16,707491

159,299
3,900

―
(296)

159,299
3,604

Semiconductors
Net sales
Sales to external customers
Internal sales or exchange
between segments
Total
Segment income (loss)

Adjusted
amount(Note 1)

(Notes)1. The adjustment of -296 million yen to segment income represents corporate expenses that are not allocated to eachreporting segment. Corporate expenses mainly refer to general and administrative expenses not belonging to any reporting
segments.
2. Segment income has been adjusted with operating income in consolidated quarterly statement of income.

-8-

4. Supplementary Information(1) Geographical Segment Information
Fiscal 2015, first three quarters of the fiscal year ended March 31, 2016
(April 1, 2015 to December 31, 2015)(Millions of yen)

Japan

Asia

Other

104,444

65,569

5,933

8,838

162

3

113,282
2,120

65,731
1,613

5,937
190

Eliminations
or corporate

Consolidated

175,947―

175,947

9,004(9,004)―

184,951
3,924(9,004)523

175,947
4,447

Total

Net sales
Sales to external customers
Internal sales or exchange between
segments
Total
Segment income(Notes)1. Country and regional segments are classified on the basis of geographic proximity.
2. Principal countries and regions:
Asia: Hong Kong, Thailand, China, South Korea, etc.
Other: United States, etc.

Fiscal 2016, first three quarters of the fiscal year ending March 31, 2017
(April 1, 2016 to December 31, 2016)(Millions of yen)

Eliminations
or corporate

Consolidated

159,299―

159,2993

8,477(8,477)

―

5,449
173

167,776
3,292(8,477)
312

159,299
3,604

Japan

Asia

Other

Total

95,88557,967

5,446

8,104

369

103,990
1,413

58,336
1,705

Net sales
Sales to external customers
Internal sales or exchange between
segments
Total
Segment income(Notes)1. Country and regional segments are classified on the basis of geographic proximity.
2. Principal countries and regions:
Asia: Hong Kong, Thailand, China, South Korea, etc.
Other: United States, etc.

-9-(2) Overseas sales
Fiscal 2015, first three quarters of the fiscal year ended March 31, 2016
(April 1, 2015 to December 31, 2015)
Overseas sales
Consolidated net sales
Ratio of overseas sales to consolidated net sales (%)

Asia
65,993
―
37.5

Other
6,035
―
3.4

(Millions of yen)Total
72,028
175,947
40.9(Notes)1. Country and regional segments are classified on the basis of geographic proximity.
2. Principal countries and regions:
Asia: China, Thailand, Hong Kong, South Korea, etc.
Other: United States, etc.
3. Overseas sales consist of the net sales of the parent company and its consolidated subsidiaries in countries and regions
other than Japan (excluding intra-group sales).

Fiscal 2016, first three quarters of the fiscal year ending March 31, 2017
(April 1, 2016 to December 31, 2016)
Overseas sales
Consolidated net sales
Ratio of overseas sales to consolidated net sales (%)

Asia
58,306
―
36.6

Other
5,533
―
3.5

(Millions of yen)Total
63,839159,299
40.1(Notes)1. Country and regional segments are classified on the basis of geographic proximity.
2. Principal countries and regions:
Asia: China, Thailand, Hong Kong, South Korea, etc.
Other: United States and others
3. Overseas sales consist of the net sales of the parent company and its consolidated subsidiaries in countries and regions
other than Japan (excluding intra-group sales).

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