Consolidated Financial Results for the Third Quarter of the
Fiscal Year Ending March 31, 2024 [Japanese GAAP]
February 1, 2024
Company name:
Stock code:
Representative:
Contact:

TOKAI Holdings Corporation
Stock listing:Tokyo Stock Exchange
3167
URL:
https://tokaiholdings.co.jp/english/
Katsuo Oguri, President & CEO
Junichi Yamada, Representative Director and Managing Executive Officer General Manager ofGeneral Affairs Headquarters
Telephone: +81-54-275-0007
Scheduled date of filing quarterly report:
February 13, 2024
Scheduled date of dividend payment:
Supplementary materials on quarterly financial results:
Yes
Quarterly financial results briefing:No(Figures are rounded to the nearest million yen)

1. Consolidated Financial Results for the Nine-months Ended December 31, 2023
(April 1, 2023 to December 31, 2023)(1) Consolidated Operating Results (cumulative)(% figures represent year-on-year changes)

Sales

Operating Profit

Millions of yen%

Millions of yen

Quarterly Net
IncomeAttributable to
Owners of the
ParentRecurring Profit

Millions of
yen

%

%

Millions of yen

Nine-months Ended
8,797
8,968
33.8
4,934
164,676
0.3
3.9
December 31, 2023
Nine-months Ended
8,466
6,705
-28.1
2,816
164,249
9.9-8.5
December 31, 2022
(Note) Comprehensive income: 6,754 million yen in the Nine-months Ended December 31, 2023 (%)
3,916 million yen in the Nine-months Ended December 31, 2022 (1.2%)

%

75.2
-39.2

Quarterly Net Income per Share(Diluted)

Quarterly Net Income per Share
Yen

Yen

Nine-months Ended December 31, 2023

35.78

37.78

Nine-months Ended December 31, 2022

21.52

-

(2) Consolidated Financial Position
Total Assets

Net Assets

Millions of yen

Millions of yen

Equity Ratio%

Nine-months Ended December 31, 2023

196,419

84,89942.1

Year ended March 31, 2023

193,339

82,304

41.5(Reference) Equity: 82,672 million yen for the Nine-months Ended December 31, 2023
80,184 million yen for the year ended March 31, 2023

2. Dividends
End of Q1

End of Q2

Annual Dividend
End of Q3

Year-end

Total

Yen

Yen

Yen

Yen

Yen

Year ending March 31, 2023

―

16.00

―

16.00

32.00

Year ending March 31, 2024

―

16.00
―

16.00

32.00

Year ending March 31, 2024
(Forecast)(Note) Revisions to most recently announced dividend forecasts: No

3. Consolidated Earnings Forecasts for the Year Ending March 31, 2024 (April 1, 2023 to March 31, 2024)(% figures represent year-on-year changes)

Sales
Millions ofyen%Operating Profit

Recurring Profit

Net Income
Attributable to
Owners of the
ParentMillions ofyenMillions ofyen%Millions of
yen

%

Yen

12.9

8,500

31.5

65.10

%

Year ending March
240,000
4.3
15,0000.5
15,00031, 2024(Note) Revisions to most recently announced earnings forecasts: No

Net Income
per Share

業績予想欄については、上場会社各社の実情に応じて、開示対象項目や開示対象期間の追加又は削除、開示形式の変更を行うことが可能です。
*Notes(1) Changes in significant subsidiaries during the period under review (changes in specified subsidiaries affecting the scope of consolidation): No(2) Application of special accounting procedures in the preparation of quarterly consolidated financial statements: No(3) Changes in accounting policies, estimates, and restatements
1) Changes in accounting policies accompanying revisions in accounting standards, etc. : No
2) Changes in accounting policies other than 1): No3) Changes in accounting estimates: No4) Restatements: No(4) Number of shares issued (common stock)
1) Shares issued at the end of each period (including treasury stock):

Q3 FY3/2024

2) Number of shares of treasury stock at the end of each period:

Q3 FY3/2024

9,054,371 shares FY3/2023

9,105,687 shares

3) Average number of shares during the period (cumulative):

Q3 FY3/2024

130,602,941 shares Q3 FY3/2023

130,879,419 shares

139,679,977 shares FY3/2023

139,679,977 shares(Note) The number of treasury shares at the end of the fiscal year includes the Company's shares held by the Stock Benefit Trust (BBT)(730,500 shares in the third quarter of the fiscal year ending March 2024, and 782,100 shares in the fiscal year ending March
2023).
In addition, the treasury stock deducted in calculating the average number of shares during the period includes the Company's
shares held by the Stock Benefit Trust (BBT) (753,204 shares in the 3Q of the fiscal year ending March 2024, 477,412 shares inthe 3Q of the fiscal year ending March 2023). Masu.

* Quarterly financial results not covered by quarterly review* Explanation regarding the Appropriate Uses of Earnings Forecasts and Other Notes
All earnings forecasts provided within this document are based on the most accurate information available at the time of the release of thisdocument. Actual results may differ from forecasts due to various factors going forward.

TOKAI Holdings Corporation (3167) Financial Results for the Nine months Ended December 31, 2023

[Attachment]
Contents

1． Qualitative Information on Financial Results for the Period Under Review(1)

Explanation of Consolidated Operating Results ····································································· 2(2)Explanation of Consolidated Financial Position ····································································· 3(3)Explanation of Consolidated Earnings Forecast and Other Forward-Looking Information··············· 4

2． Quarterly Consolidated Financial Statements and Notes(1)

Quarterly Consolidated Balance Sheets ·············································································· 5(2)Quarterly Consolidated Statement of Income, Consolidated Statements of Comprehensive Income 7(3)

Quarterly Consolidated Statements of Cash Flows ································································ 9(4)Notes on Quarterly Consolidated Financial Statements ························································· 10(Notes on Going Concern Assumptions) ················································································· 10(Notes on Significant Changes in Shareholders' Equity) ····························································· 10(Segment Information） ······································································································ 10

1TOKAI Holdings Corporation (3167) Financial Results for the Nine months Ended December 31, 2023

1. Qualitative Information on Financial Results for the Period Under Review(1) Explanation of Consolidated Operating Results
During the first nine months of the fiscal year under review, the economy experienced a mild recovery
aided by various government packages, including measures to ease the situation for consumers. However,the business circumstances surrounding the Group were marked by persistently high material purchaseprices in the energy segment. There are issues with worsening labor shortages and the response to soaring
prices.
In this environment, the Group developed Medium-Term Management Plan 2025 and announced it in May
2023. Aimed at achieving sustained growth, this plan has set out three key themes. The first is growth of
earning power, the second is strengthening of the foundations for sustainable growth, and the third is the fullenergization of human capital and organizations.
For the first nine months of the fiscal year under review, the Group saw the number of continuing customers
rise by 41,000, to 3,341,000, compared with growth of 64,000 in the same period of the previous fiscal year.
The number of TLC members rose 43,000 to 1,201,000. For the same period a year earlier, the figure surged
53,000. Thanks to the increase in the number of the Group's customers, net sales reached 164,676 million
yen, up 0.3% year on year, and operating profit 8,797 million yen, up 3.9% year on year. Ordinary profit stood
at 8,968 million yen, up 33.8% year on year, and profit attributable to owners of parent at 4,934 million yen,up 75.2% year on year. Increases resulted mainly from a decrease in the burden arising from the share of
profit of entities accounted for using equity method.
Notable events during the first nine months of the fiscal year under review include an investment made in
July 2023 in the group led by Pure Energy Holdings Corporation, which operates a business of generating
power from renewable energy sources in the Republic of the Philippines, as part of the initiatives to achievecarbon neutrality. Another event is the new opening of a sales office for LP gas sales in the city of Ise in Mie
Prefecture in August 2023. The office is making steady progress in expanding the business base. In October
2023, a Group company became the 14th company in Japan to acquire the highest AWS Premier Tier
Services Partner certification under the Amazon Web Services (AWS*) Partner Network, which acts as AWS'
partner certification program. In December 2023, the Group invested in Albatross Technology Inc., which
engages in offshore wind power development. The Group will continue its initiatives for carbon reduction anddecarbonization.
* Amazon Web Services (AWS): A cloud service provided by Amazon Web Services, Inc. in the UnitedStates.
Performance by segment is indicated below. From the first quarter of the fiscal year under review onwards,
a new order of statement of segments applies.
(Energy)In the LP gas business, the number of customers increased 22,000 from the end of the previous fiscal year,
to 767,000, reflecting sustained Group efforts to attract customers. Meanwhile, net sales were 56,491 million
yen (down 1.8% year on year). This is attributable to a reduction in selling prices in associated with thepurchase prices and a decrease in gas sales volume for households for reasons including high airtemperatures.
In the city gas business, the number of customers remained at 75,000, the same level as the end of theprevious fiscal year. Net sales reached 12,780 million yen (down 5.7%) due to the effects of the gas rateadjustment system.
Net sales in this segment were 69,271 million yen (down 2.5%), and operating profit was 1,333 million yen(up 8.3%).
2

TOKAI Holdings Corporation (3167) Financial Results for the Nine months Ended December 31, 2023

(Information and Communications)
In the business for consumers, it worked to gain customers in collaboration with major telecommunications
carriers in the ISP business. In the mobile business, the Group broadened the LIBMO service lineup andintroduced package plans with fixed lines. As a result of these measures, the number of broadband
customers increased 3,000 from the end of the previous fiscal year to 667,000, while the number of LIMBO
customers rose 6,000 from end of the preceding fiscal year to 77,000. Net sales reached 18,220 million yen(up 0.1% year on year).
In the business for corporate clients, net sales came to 23,601 million yen, up 9.9% year on year, reflecting
steady growth in career services and cloud services.
Net sales in this segment stood at 41,822 million yen (up 5.4%), and operating profit came to 2,965 million
yen (up 18.7%).
(CATV)In the CATV business, the Group focused on providing local information and the production of programs
as a community-based service provider. The Group collaborated with major video distributors and madeother efforts to enhance content. Due to aggressive sales activities in new areas, the broadcasting services
customer count rose to 918,000, an increase of 4,000 from the end of the previous fiscal year. The
communications services customer count increased to 389,000, a rise of 16,000 from the end of the previous
fiscal year.
Net sales in this segment stood at 26,673 million yen (up 4.6%). Operating profit came to 4,142 million yen(down 1.8%), reflecting an increase in expense for gaining customers, among other factors.
(Construction, Equipment, and Real Estate)
In the Construction, Equipment and Real Estate business, net sales stood at 17,585 million yen, down
6.7% year on year, and operating profit at 506 million yen, down 21.5% year on year. These results are
attributable mainly to decreases in large civil engineering works and facilities projects.
(Aqua)In the Aqua (bottled drinking water delivery) business, the Group began dealing with pure water dispensers
in April 2023, in an effort to continuously expand its customer base. The Group also conducted marketing
activities at events in large commercial facilities as well as non-face-to-face sales activities, including online
promotion and telemarketing. The number of customers grew 2,000 from the end of the previous fiscal year
to 166,000.
Net sales in this segment stood at 5,796 million yen (up 1.3%), and operating profit came to 277 million
yen (up 58.1%).
(Others)
Net sales in the nursing care business stood at 1,058 million yen (up 1.9%), reflecting an increase in thenumber of users. In the ship repair business, net sales were 962 million yen (down 9.2%) as a result of
decline in work volume. In the bridal events business, net sales reached 931 million yen (up 26.5%) after arecovery of uses.
Net sales in this segment stood at 3,526 million yen (up 2.3%), and operating profit came to 33 million yen(down 74.3%).
(2) Explanation of Consolidated Financial Position
1) Assets, Liabilities, and Net Assets
Total assets at the end of the first nine months under review stood at 196,419 million yen, an increase3

TOKAI Holdings Corporation (3167) Financial Results for the Nine months Ended December 31, 2023

of 3,079 million yen from the end of the previous fiscal year. The increase was attributable primarily to anincrease of 2,115 million yen in Other as part of current assets after a rise in derivative valuations, anincrease of 1,824 million yen in property, plant and equipment, an increase of 1,132 million yen in Otheras part of investment securities and an increase of 763 million yen in cash and deposits, which waspartially offset by a decrease of 2,826 million yen in notes and accounts receivable - trade and contract
assets mainly for seasonal reasons.
Total liabilities came to 111,519 million yen, an increase of 484 million yen from the end of the previous
fiscal year. The increase was chiefly due to an increase of 7,076 million yen in short-term borrowings,
which was partially offset by a decrease of 2,403 million yen in long-term borrowings, a decrease of 1,675
million yen in income taxes payable, a decrease of 1,511 million yen in other provisions as part of current
liabilities due mainly to bonus payments, and a decrease of 1,301 million yen in notes and accounts
payable - trade.
Total net assets were 84,899 million yen, an increase of 2,595 million yen from the end of the previous
fiscal year. This was chiefly due to profit attributable to owners of the parent posted at 4,934 million yen,
an increase of 964 million yen in deferred gains or losses on hedges and an increase of 889 million yen
in the valuation difference on available-for-sale securities despite dividends of surplus of 4,203 million yen.
2) Cash Flows
Cash and cash equivalents (“cash”) as of December 31, 2023 were 4,949 million yen, an increase of
920 million yen from the end of the previous fiscal year.
Cash flows in the first nine months under review and major contributing factors are as follows.
(Cash flows from operating activities)
Net cash provided by operating activities was 17,873 million yen (7,234 million yen higher year on year).
Cash inflows were attributable primarily to net income before income taxes, a decrease in notes andaccounts payable, and depreciation, a non-cash account, which were partially offset by income taxes paid
and a decrease in notes and accounts payable-trade, among other cash outflows.
Net cash provided by operating activities increased substantially year on year. This is due mainly tocontracting increase in inventories and of income taxes paid, in addition to a increase in profit before
income taxes.
(Cash flows from investing activities)
Net cash used in investing activities 13,567 million yen (2,715 million yen less year on year). The cash
outflows were attributable primarily to purchases of property, plant and equipment and intangible assets
and to expenses for acquisition of securities.
(Cash flows from financing activities)
Net cash used in financing activities was 3,400 million yen (3,994 million yen less year on year). Loanspayable and other cash inflows were more than offset by cash outflows, including repayment of loans
payable, repayments of lease obligations and payment of cash dividends.
(3) Explanation of Consolidated Earnings Forecast and Other Forward-Looking Information
Results in the first nine months of the fiscal year under review were roughly as forecast. The earnings
forecasts for the fiscal year ending March 31, 2024 announced on May 9, 2023 remain unchanged.
The earnings forecasts are based on information available at the time of publication. Actual results may
differ from the forecasts due to a variety of factors.

4

TOKAI Holdings Corporation (3167) Financial Results for the Nine months Ended December 31, 2023

2. Quarterly Consolidated Financial Statements and Notes(1) Quarterly Consolidated Balance Sheets
Fiscal Year Ended
March 31, 2023
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade and contract assets
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
Land
Other, net
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Net defined benefit asset
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Deferred assets
Total assets

5(Millions of yen)
Nine Months Ended
December 31, 2023

4,359
29,899
5,448
1,130
1,589
9,850
- 454
51,824

5,123
27,072
5,328
1,796
1,546
11,966- 467
52,36736,18826,03824,841
23,316110,384

36,671
26,30424,932
24,300112,209

5,904
4,588
10,492

5,630
4,519
10,150

4,092
16,785- 243
20,634
141,5113
193,339

4,145
17,917- 374
21,688144,0483
196,419

TOKAI Holdings Corporation (3167) Financial Results for the Nine months Ended December 31, 2023

Fiscal Year Ended
March 31, 2023
Liabilities
Current liabilities
Notes and accounts payable–trade
Short-term loans payable
Income taxes payable
Other provision
Other
Total current liabilities
Non-current liabilities
Long-term loans payable
Other provision
Net defined benefit liability
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurement of defined benefit plans
Total accumulated other comprehensive income
Share acquisition rights
Non-controlling interests
Total net assets
Total liabilities and net assets

6(Millions of yen)
Nine Months Ended
December 31, 2023

19,801
15,7532,247
1,570
21,67361,046

18,50022,830571
59
21,42063,38230,855342
1,377
17,412
49,988111,034

28,451297
1,476
17,911
48,137
111,519

14,00025,56638,526- 2,601
75,492

14,00025,56739,257- 2,561
76,263

1,458
－
741
2,492
4,692
36
2,083
82,304
193,339

2,347
964
843
2,252
6,408
50
2,177
84,899196,419

TOKAI Holdings Corporation (3167) Financial Results for the Nine months Ended December 31, 2023

(2) Quarterly Consolidated Statements of Income, Consolidated Statements of Comprehensive Income(Quarterly Consolidated Statements of Income)(Nine Months Ended December 31, 2023)

Sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating profit
Interest income
Dividend income
Commission fee
Other
Total non-operating profit
Non-operating expenses
Interest expenses
Share of loss of entities accounted for using equity method
Other
Total non-operating expenses
Recurring profit
Extraordinary income
Gain on sales of non-current assets
Gain on reversal of subscription rights to shares
Gain on bargain purchaseTransmission line facility subsidies
Subsidy income
Total extraordinary income
Extraordinary losses
Loss on sales of non-current assets
Loss on retirement of non-current assets
Loss on valuation of investment securities
Special investigation fee
Total extraordinary losses
Quarterly net income before income taxes
Income taxes (current)
Income taxes (deferred)
Total income taxes
Quarterly net income
Quarterly net income attributable to non-controlling interests
Quarterly net income attributable to owners of the parent

7

Nine Months Ended
December 31, 2022
(April 1, 2022 to
December 31, 2022)
164,249
102,720
61,52953,063
8,466(Millions of yen)
Nine Months Ended
December 31, 2023
(April 1, 2023 to
December 31, 2023)
164,676
100,848
63,82755,030
8,797

11
212
22
275
521

11
234
22
256
525

200
2,001
80
2,282
6,705

227
75
52
354
8,968

28
103
51
87
3
274

171
3
－
71
9
255

0
592
－
312
905
6,073
2,191
918
3,109
2,964
148
2,816

0
896
33
－
931
8,292
2,761
494
3,255
5,037
102
4,934

TOKAI Holdings Corporation (3167) Financial Results for the Nine months Ended December 31, 2023

(Consolidated Statements of Comprehensive Income)(Nine Months Ended December 31, 2023)

Quarterly net income
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains (losses) on hedges
Foreign currency translation adjustment
Remeasurement of defined benefit plans, net of tax
Share of other comprehensive income of entities accounted forusing the equity method
Total other comprehensive income
Quarterly comprehensive income(Breakdown)
Quarterly comprehensive income attributable to owners of theparentQuarterly comprehensive income attributable to non-controllinginterests

8

Nine Months Ended
December 31, 2022
(April 1, 2022 to
December 31, 2022)
2,964(Millions of yen)
Nine Months Ended
December 31, 2023
(April 1, 2023 to
December 31, 2023)
5,037

821
－
-5
-241

889
964
10
- 239

378

93

952
3,916

1,717
6,754

3,766

6,651

149

103

TOKAI Holdings Corporation (3167) Financial Results for the Nine months Ended December 31, 2023

(3) Quarterly Consolidated Statements of Cash Flows(Millions of yen)
Nine Months Ended Nine Months Ended
December 31, 2022 December 31, 2023
(April 1, 2022 to(April 1, 2023 to
December 31, 2022) December 31, 2023)
Cash flows from operating activities
Quarterly net income before income taxes
Depreciation
Amortization of goodwill
Gain on bargain purchase
Impairment loss
Increase (decrease) in net defined benefit asset and liability
Interest and dividend income
Loss (gain) on sales of investment securities
Interest expenses
Loss (gain) on sale of non-current assets
Loss (gain) on valuation of investment securities
Loss on retirement of non-current assets
Decrease (increase) in notes and accounts receivable – trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable – trade
Other
Subtotal
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Interest and dividend income received
Purchase of securities
Proceeds from sales of securities
Purchase of tangible and intangible assets
Proceeds from sales of tangible and intangible assets
Purchase of shares of subsidiaries resulting in change in scope of
consolidation
Proceeds from collection of loans receivable
Other
Net cash provided by (used in) investing activities
Cash flows from financing activities
Interest expenses paid
Net increase (decrease) in short-term loans payable
Repayments of lease obligations
Proceeds from long-term loans payable
Repayment of long-term loans payable
Payments for acquisition of treasury stock
Cash dividends paid
Other
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

9

6,073
11,342
738
-51
-310
-223
-103
200
2,001
-28
－
592
991
-3,390615-1,257
17,191-6,552
10,638

8,292
11,747
719
－
- 295
- 245
-3
227
75
- 170
33
896
3,020
- 245
- 1,328- 933
21,788- 3,915
17,873278-1,154145-10,645298

282- 1,09718- 12,553
564

-285

- 560

603
-93
-10,8528- 230- 13,567-204
10,550-3,4485,950-7,919-0-4,324
-8
594
0
381
4,447
4,828

- 231
7,459
- 3,636
5,400- 8,186-0- 4,195-9- 3,400
15
920
4,028
4,949

TOKAI Holdings Corporation (3167) Financial Results for the Nine months Ended December 31, 2023

(4) Notes on Quarterly Consolidated Financial Statements(Notes on Going Concern Assumptions)Not applicable(Notes on Significant Changes in Shareholders’ Equity)
Not applicable(Segment Information, etc.)[Segment Information]
From the first quarter consolidated accounting period, the order of reporting segments has been changed.
Accordingly, the order of reporting segments for the previous third quarter consolidated cumulative period has been
similarly changed.
I. Nine Months Ended December 31, 2022 (April 1, 2022 to December 31, 2022)
Information on net sales and profit or loss by reportable segment(Millions of yen)
Reportable segments
Construction,
Other1
Information andEquipment,
EnergyCATV
Aqua Subtotal
Communications
and Real
EstateTotal

Amount inquarterly
Adjustments2 consolidated
statement ofincome3

Net sales
Sales toexternalcustomers
Intrasegment
sales andtransfer

71,069159

39,662 25,510

3,064

358

18,840 5,720 160,803

971

203

4,757

3,446 164,249

264

5,021

－

164,249- 5,021－

Subtotal
71,22842,726 25,868
19,811 5,924 165,560 3,710 169,271- 5,021
164,249
Segment profit
1,231
2,498 4,218
645
175
8,769
129
8,899
- 433
8,466
(loss)(Notes) 1. The “Others” category is a business segment not included in the reportable segments. This category includes
businesses such as weddings, ship repair, insurance, and nursing care.
2. Adjustments to segment profit (loss) are eliminations due to intra-segment transactions.
3. Segment profit (loss) is adjusted to match operating profit in the quarterly consolidated statements of income.
II. Nine Months Ended December, 2023 (April 1, 2023 to December 31, 2023)
Information on net sales and profit or loss by reportable segment
Reportable segments

EnergyInformation and
CATVCommunications

69,271

41,822 26,673

Construction,
Other1Equipment,
Aqua Subtotal
and Real
Estate

Total(Millions of yen)Amount inquarterly
Adjustments2 consolidated
statement ofincome3

Net sales
Sales toexternalcustomers
Intrasegment
sales andtransfer

120

4,008

304

17,585 5,796 161,149 3,526 164,676

753

Subtotal

218

5,406

252

5,659

－

164,676- 5,659－

69,39245,830 26,97818,339 6,015 166,556 3,779 170,335- 5,659
164,676
Segment
1,333
2,965 4,142
506
277
9,226
33
9,259
- 462
8,797
profit (loss)(Notes) 1. The “Others” category is a business segment not included in the reportable segments. This category includes
businesses such as weddings, ship repair, insurance, and nursing care.
2. Adjustments to segment profit (loss) are eliminations due to intra-segment transactions.
3. Segment profit (loss) is adjusted to match operating profit in the quarterly consolidated statements of income.

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