Balance Sheet(As of March 31, 2020)(Million yen)
Item

AmountItem(Assets)
Current assets
Cash and deposits
Trade accounts receivable
Accounts receivable
Merchandise
Short-term loans receivable
Current portion of long-term loans
receivable(Liabilities)

88,008833
13,722
1,455
209
68,8662,000

Prepaid expenses

725

Other

195

Buildings

80,19648,02536,944Structures

332

Machinery and equipment

295

Furniture and fixtures673

Non-current assets
Property, plant and equipment

Land
Leased assets
Construction in progress

Amount

1,545
8
8,225

Unearned revenue

31,015
11,998
141
206
1,442
145

Deposits received from customers

15,987

Current liabilities
Accounts payable - otherAccrued expenses
Accrued consumption taxes
Income taxes payable

Current portion of guarantee deposits
and leasehold deposits received
Provision for bonuses
Provision for sales promotion
expenses
Other

209

Non-current liabilities
Guarantee deposits and leasehold
deposits received
Provision for retirement benefits
Provision for loss on business of
subsidiaries and associates
Asset retirement obligations

19,951Other

Software
Other

666
632
34

Investment securities
Shares of subsidiaries and associates
Long-term prepaid expenses
Guarantee deposits and leasehold
deposits
Long-term loans receivable
Deferred tax assets
Other
Allowance for doubtful accounts

31,503
681
2,228
678
4,410
20,400
3,073
31
(0)

168,205

16,935
1,424
47
1,436
107

117,2372,375

Shareholders' equity

5,964
5,964

Capital surplus
Legal capital surplus

108,898

Retained earnings

596
108,302
101,822

Legal retained earnings
Other retained earnings
General reserve
Retained earnings
forwardbrought

6,480

Valuationandtranslation
adjustments
Valuation difference on availablefor-sale securities

0

Total net assets
Total assets

443(Net assets)
Share capital

Investments and other assets

27

50,967

Total liabilities
Intangible assets

413

Total liabilities and net assets

0117,238
168,205

Statement of Income(From April 1, 2019 to March 31, 2020)(Million yen)

Item

AmountNet sales
Real estate lease revenue

67,218Net sales of directly managed businesses

7,132

74,350

Cost of sales
Cost of sales of directly managed businesses

5,465

Gross profit

68,88557,307

Selling, general and administrative expenses

11,577

Operating profit
Non-operating income
Interest income

397

Dividend income

6

Other non-operating income

74

478

Non-operating expenses
Foreign exchange losses
Other non-operating expenses

2
101

104
11,951

Ordinary profit
Extraordinary income
Early cancellation fees received

7

Other extraordinary income

08Extraordinary losses
Loss on retirement of non-current assets

515

Removal expenses for non-current assets
Loss on valuation of shares of subsidiaries andassociates
Loss on valuation of investment securities

715

Provision for loss on business of subsidiaries and associates

47

Impairment loss

642

Other extraordinary losses

103

296
168

9,469

Profit before income taxes
Income taxes - current

3,417

Income taxes - deferred(276)

Profit

2,490

3,140
6,328

Notes to the Non-consolidated Financial Statements
1

Notes on Significant Accounting Policies
1.

Valuation Standards and Methods for Assets(1)

Valuation standards and methods for securities
Stocks of subsidiaries and affiliates
Stated at cost based on the moving average method.
Other securities
・ Securities with a market value
Stated at fair market value based on the market price, etc. at the end of the fiscal year (allvaluation differences are directly charged or credited to net assets and the costs of securities
sold are calculated using the moving average method).
・ Securities without a market value
Stated at cost based on the moving average method.

(2)

2.

3.

Valuation standards and methods for inventories
MerchandiseStated at cost based on the specific identification method (the balance sheet value is calculated by
reducing the book value based on declines in profitability.).

Depreciation and Amortization Methods for Non-current Assets(1)

Property, plant and equipment (excluding leased assets)
Depreciation is computed by the declining-balance method.
Useful lives and residual values are calculated using the same standards as those prescribed in the
Corporation Tax Act.

(2)

Intangible assets
Amortization is computed by the straight-line method.
Useful lives are calculated using the same standards as those prescribed in the Corporation Tax
Act.
However, software (for internal use) is amortized using the straight-line method based on the
period during which it can be used internally (5 years).

(3)

Leased assets
Leased assets related to finance lease transactions without transfer of ownership
The straight-line method is used with the lease period as the useful life and the residual value as
zero.

(4)

Long-term prepaid expenses
Amortization is principally computed by the declining-balance method.
The amortization period is based on the same standards as those prescribed in the Corporation
Tax Act.

Standards for Recording Provisions(1)

Allowance for doubtful accounts
To provide for losses on bad debts, an allowance for doubtful accounts is provided by recording
estimated unrecoverable amounts based on the historical bad debt ratio for general receivables andexamination of the collectibility of individual receivables for specific receivables such as doubtful anddistressed receivables.

2

(2)

Provision for bonuses
To provide for the payment of bonuses to employees, a provision for bonuses is recorded based on
the estimated amount of payment.

(3)

Provision for sales promotion expenses
To provide for future expenditures related to the utilization of "ONE LUMINE Shopping Ticket,"the amount expected to be utilized in the future is recorded based on the historical utilization rate.

(4)

Provision for retirement benefits
1) Method of attribution of projected retirement benefits to period
In calculating retirement benefit obligations, the benefit formula standard is used to attribute theestimated amount of retirement benefits to the period up to the end of the current fiscal year.
2) Amortization of actuarial gains and losses and prior service cost
Prior service cost is amortized on a straight-line basis over a fixed number of years (10) within
the average remaining service period of employees at the time of occurrence.
Actuarial gains and losses are amortized by the straight-line method over a fixed number ofyears (10) within the average remaining service period of employees at the time of recognition ineach fiscal year, and allocated proportionately from the fiscal year following the respective fiscal
year of occurrence.

(5)

Provision for loss on business of subsidiaries and associates
To provide for losses on the business of subsidiaries, an amount deemed necessary in considerationof such factors as the financial position of the subsidiaries is recorded.

4.

Standards for Translation of Assets and Liabilities Denominated in Foreign Currencies into Japanese
Currency
Monetary claims and obligations denominated in foreign currencies are translated into Japanese yenat the spot exchange rate prevailing on the balance sheet date, and any translation differences arecharged or credited to income.

5.

Other Important Matters that Serve as the Basis for Preparation of Financial Statements
Consumption taxes are accounted for by the tax-exclusion method.

Notes to the Balance Sheet(1)

Accumulated depreciation of property, plant and equipment(2)

Future lease payments on non-cancelable operating lease transactions(As lessee)
Within one year
2,266 million yen
Over one year
21,692 million yen
Total

(3)

118,279 million yen

23,958 million yen

Monetary claims against and obligations to subsidiaries and associates
Short-term monetary claims
837 million yen
Short-term monetary obligations
552 million yen
Long-term monetary obligations
43 million yen

3Notes to the Statement of Income
(1)

(2)

4

Transactions with subsidiaries and associates
Operating transactions
Net sales
Selling, general and administrative expenses
Non-operating transactions

907 million yen
13,430 million yen
46 million yen

Loss on valuation of shares of subsidiaries and associates
Loss on valuation of shares of subsidiaries and associates resulted from impairment losses on sharesof LUMINE SINGAPORE PTE. LTD held by the Company.

Notes to the Statement of Changes in Equity
Matters concerning the class and total number of issued sharesClass of shares
Common stock5

Number of shares Increase in the
Decrease in the Number of sharesat the beginning of number of shares number of shares at the end of thethe period
during the period during the period
period(shares)(shares)(shares)(shares)
70,378,000
70,378,000－－

Notes to Tax Effect Accounting
The main reasons for the occurrence of deferred tax assets are overdepreciation, denial of asset retirement
obligations, etc. The main reason for the occurrence of deferred tax liabilities is denial of non-current asset
retirement expenses, etc.
The valuation allowance deducted from deferred tax assets is 405 million yen.

6

Notes on Financial Instruments(1)

Matters concerning the status of financial instruments
The Company limits fund management when surplus funds arise to loans to CMS (cash management
system), which collectively manages the funds of the entire JR East Group.
Concerning the credit risk of customers in relation to trade accounts receivable, the Company manages
due dates and balances appropriately for each customer.
Investment securities are stocks, and the market value of listed stocks is ascertained quarterly.

(2)Matters concerning the fair value of financial instruments, etc.
The balance sheet amounts and fair values of financial instruments as of March 31, 2020 (the closing dateof the fiscal year under review), as well as the differences between them, are as follows. Financial
instruments whose fair values are considered extremely difficult to ascertain are not included in thefollowing table.
(Million yen)

1)

Cash and deposits
Tradeaccounts
2)
receivable
Short-term
loans
3)
receivable4) Investment securities
Other securities
Guarantee deposits5) andleaseholddeposits
Long-termloans
6)
receivable
Accounts payable 7)
other
Incometaxes
8)payableDeposits
received
9)from customers
Guarantee deposits10) andleaseholddeposits received

Amount recorded on thebalance sheet (*)
833

Fair value (*)

Difference
833－

13,722

13,722－

68,866

68,866

－

161

161

－

1,495

1,406

(89)

22,40022,806406(11,998)(11,998)－(1,442)(1,442)－(15,987)(15,987)－(15,854)(15,748)106(*) Items recorded as liabilities are shown in parentheses.
(Note 1) Methods of calculating the fair values of financial instruments and matters related to securities
1) Cash and deposits, 2) Trade accounts receivable, and 3) Short-term loans receivable
Since these are settled in a short period of time, the fair value is almost equal to the book value, so
the book value is used.
4) Investment securities
The fair values of these instruments are based on the exchange prices.
5) Guarantee deposits and leasehold deposits
The fair value of guarantee deposits and leasehold deposits is calculated by discounting future cash
flows using interest rates that take into account credit risks and other factors.
6) Long-term loans receivable
The fair value of long-term loans receivable is calculated by discounting future cash flows using
interest rates assumed for similar new transactions.
7) Accounts payable - other, 8) Income taxes payable, and 9) Deposits received
Since these are settled in a short period of time, the fair value is almost equal to the book value, so
the book value is used.
10) Guarantee deposits and leasehold deposits received
The fair value of guarantee deposits and leasehold deposits received is calculated by discounting
future cash flows using interest rates that take into account credit risks and other factors.

(Note 2) Financial instruments whose fair values are considered extremely difficult to ascertain
Unlisted stocks of 2,748 million yen (shares of subsidiaries and associates of 2,228 million yen andother securities of 520 million yen), a portion of guarantee deposits and leasehold deposits of 2,501
million yen and a portion of guarantee deposits and leasehold deposits received of 1,289 million yen
are not included in the table because they do not have market values and because their future cash
flows cannot be estimated, etc., and as such, it is extremely difficult to ascertain their fair values.
Unamortized leasehold deposits that are not expected to be recovered (estimated restoration cost ofleased buildings) totaling 414 million yen are not included in the table.
(Note 3) The balance sheet amounts and fair values of long-term loans receivable and guarantee deposits andleasehold deposits received include the portion of long-term loans receivable expected to be recovered
within one year and the portion of guarantee deposits and leasehold deposits received expected to be
repaid within one year, respectively.

7

Notes on Real Estate for Lease, etc.
(1)

Matters concerning the status of real estate for lease, etc.

The Company has commercial facilities for lease in Tokyo and other areas.
(2)

Matters concerning the fair value of real estate for lease, etc.
(Million yen)Amount recorded on the balance sheet
39,204

Fair value
38,252(Note 1) The amount recorded on the balance sheet is the amount obtained by deducting accumulated
depreciation from acquisition cost.
(Note 2) The fair value at the end of the fiscal year under review is the amount calculated by the Company
based on certain assessed values and indicators thought to appropriately reflect market prices. For
depreciable assets such as buildings, the fair value at the end of the fiscal year under review is theappropriate book value.

8

Notes on Transactions with Related Parties(1)

Parent company and major corporate shareholders, etc.
(Million yen)Type

Name ofcompany

Parentcompany

East Japan Railway
Company

Percentage ofRelationshipvoting rights, etc.
Nature of thewith theheld of (or by)transaction
related party
the related party
Concurrent
appointment
Directly owns
of officers, Payment of lease
95.1% of thelease of land fees for land andCompany
for stationbuildings
buildings,
etc.

Transaction
amountItem

Accounts
9,752 payable other

Balance asof March
31, 2020

9Transaction conditions and policy for determining transaction conditions, etc.
(Note 1) Lease fees and other terms and conditions are determined after price negotiations, taking into
consideration the prevailing market conditions.
(Note 2) The transaction amount does not include consumption taxes. The balance as of March 31, 2020
includes consumption taxes.

(2)Affiliated companies, etc.
(Million yen)Type

Percentage ofRelationshipvoting rights, etc.
Name of company
with theheld of (or by)related party
the related party

Subsidiaryof theViewcard Co., Ltd.
parentcompany
Subsidiary
JR East Marketingof the& Communications,parentInc.
company
Subsidiaryof theparentcompany

JR East Building
Co., Ltd.

Nature of thetransaction

Transaction
amountItem

Balance asof March
31, 2020

None

Merchant Transfer of credit
agreement card receivablesTrade148,519 accounts
receivable

5,752

None

Payment ofcommission fees
Subcontracti
for planning andng
production ofagreement
advertising andsales promotions

Accounts
3,422 payable other

657

None

Lease
Payment of leaseagreements
fees

Prepaid
expenses
3,586
Leaseholddeposits

258
2,042

Transaction conditions and policy for determining transaction conditions, etc.
(Note 1) The transfer of credit card receivables is determined after price negotiations, taking into consideration
the prevailing market conditions.
(Note 2) Terms and conditions related to commission fees are determined after price negotiations, taking into
consideration the prevailing market conditions.
(Note 3) Terms and conditions related to lease fees are determined after price negotiations, taking into
consideration the prevailing market conditions.
(Note 4) Among the amounts shown above, consumption taxes are not included in transaction amounts excludingtransfers of credit card receivables.
In addition, in the balances as of March 31, 2020, trade accounts receivable, accounts payable - other,and prepaid expenses include consumption taxes.

9Notes to Per Share Information(1)(2)

Net assets per share
Profit per share

1,665.84 yen
89.92 yen

10Notes on Business Combinations(1)

Transactions under common control
The Company transferred rights and obligations related to its 800°DEGREES business to STABLES

CO. LTD., which was established on April 1, 2019.
1) Overview of transactiona.
Name and description of businessBusiness name: 800°DEGREES businessBusiness description: Restaurant business, development and operation of stores, restaurants,
etc., and businesses related to consulting and training in connection with
employees and personnel development, etc.
b. Split date
April 1, 2019c.
Legal form of the company split
Simple incorporation-type company split with the Company as the split company and STABLES
CO. LTD. as the succeeding company
d. Objective of the company split
The Company has established a new strategic subsidiary in the restaurant business in response to
the growing importance of food in creating life value. As a result, the Company will concentrate
resources on highly specialized restaurant skills and accelerate the expansion of the scope of its
businesses in new highly original food-related fields.
2) Outline of the accounting implemented
The transaction is treated as a transaction under common control based on "Accounting Standard forBusiness Combinations" (ASBJ Statement No. 21, January 16, 2019) and "Implementation Guidance on
Accounting Standard for Business Combinations and Accounting Standard for Business Divestitures"(ASBJ Guidance No. 10, January 16, 2019).

11

Other Notes(1)

Impact of the novel coronavirus

In response to the declaration of a state of emergency by the government of Japan on April 7, 2020,
based on the Act on Special Measures for Pandemic Influenza and New Infectious Diseases
Preparedness and Response, the Company has implemented continuous measures, including temporary store
closures, shortening of business hours, and reductions or exemptions of rent for tenants. Depending on how
the situation progresses, there is a possibility that the financial position and business results of the Company
will be materially affected from next fiscal year onward.
(2)

Presentation of stated amounts
The amounts under items and other information in the Company’s financial statements were formerly statedin thousands of yen, but from the fiscal year under review, the unit used for presentation has been changed tomillions of yen.
Amounts less than one million yen have been rounded down for presentation purposes.