CONSOLIDATED FINANCIAL REPORTFISCAL 2018（Japanese GAAP）(March 1, 2018 to February 28, 2019)
April 10, 2019
YONDOSHI HOLDINGS INC. is listed on the First Section of the Tokyo Stock Exchange under the securities code number 8008.
Representative:
Inquiries:

Saishi Kimura, Chairman and Representative Director, CEO
Masahiko Nishimura, Director and Executive Officer responsible for finance
Tel: +81-3-5719-3429
URL: https:// yondoshi.co.jp/
Annual General Meeting of Shareholders date (planned): May 16, 2019
Fiscal 2018 Securities Report filing date (planned): May 17, 2019
Dividend payment commencement date (planned): May 17, 2019
Supplemental materials prepared for financial results: Yes
Holding of financial results meeting: Yes (for analysts and institutional investors)(Millions of yen rounded down)

1. Consolidated Performance for FY 2018 (March 1, 2018 to February 28, 2019)(1) Consolidated Business Results(% figures represent year-on-year increase or decrease)
Operating Revenues%

Millions of yen

Operating Income%

Millions of yen

Profit attributable toOrdinary Income%

Millions of yen

owners of parent%

Millions of yen

FY 2018

47,118

(2.0)

4,984

(18.3)

6,804(10.0)

2,440(53.9)FY 2017

48,060

(3.5)

6,102

(6.5)

7,562

(3.0)

5,293

6.7

(Note) Comprehensive income: FY 2018: ¥5,755 million (2.4%)
Net Income Per
Share

FY 2017: ¥5,620 million ((1.9)%)

Net Income Per
Share (Diluted)

Yen

ROE

Yen

Ordinary Income
to Total Assets

Ordinary Income
to Operating
Revenues%%%

FY 2018
96.03
96.01
5.0
10.8
10.6
FY 2017207.09206.80
10.4
11.7
12.7
(Reference) Equity in earnings of affiliated companies accounted for by the equity method:
FY 2018: ¥677 million
FY 2017: ¥1,230 million
Operating income before the amortization of goodwill: FY 2018: ¥5,481 million FY 2017: ¥6,599 million
YONDOSHI HOLDINGS has positioned operating income before the amortization of goodwill as an importantmanagement indicator.

(2) Consolidated Financial Position
Total Assets

Net Assets to Total

Net Assets

Net Assets per Share ofCommon Stock

AssetsMillions of yen

Millions of yen%

Yen

As of February 28, 201959,934

43,58772.6

1,883.28

As of February 28, 2018

66,32153,39980.4

2,077.02(Reference) Shareholders’ equity: As of February 28, 2019: ¥43,497 million(3) Consolidated Cash Flows― 1 ―As of February 28, 2018: ¥53,299 million

Operating Activities
Millions of yen

2.

Financing Activities

Cash and Cash
Equivalents at the Endof the Period

Millions of yen

Millions of yen

Millions of yen

Investing Activities

FY 2018

1,664

5,407

(9,344)

3,749

FY 2017

5,427(3,023)(1,665)

6,026

Dividends
Cash Dividends per Share of Common Stock
End of 1Q End of 2Q End of 3Q

FY 2017
FY 2018
FY 2019 (planned)3.

End of 4Q

AnnualCashDividend

Dividends

Payout Ratio

to Net Assets

Paid (Annual)(Consolidated)(Consolidated)

Cash Dividends

Yen

Yen

Yen

Yen

Yen

Millions of yen

%

%

—
—
—

32.50
37.50
40.00

—
—
—

32.50
37.50
40.00

65.00
75.00
80.00

1,713
1,862

31.4
78.1
59.8

3.3
3.8

Forecast of Consolidated Results for FY 2019 (March 1, 2019 to February 29, 2020)(% figures for the full fiscal year represent year-on-year increase or decrease,% figures for the interim period are the increase / (decrease) for the corresponding period of the previous fiscal year)
Operating Revenues
Millions of yen%

Operating Income
Millions of yen

Ordinary Income%

Millions of yen%

Profit attributable to

Net Income perowners of parent

Share

Millions of yen%

Yen

Interim22,400
1.4
2,100
5.3
2,250 (12.7)
1,500 (17.5)
59.02
Full
Fiscal
47,300
0.4
5,100
2.3
5,400 (20.6)
3,400
39.3
133.78Year(Reference) Forecast EPS before the amortization of goodwill after taking into account repurchase of the Company’s own sharesto the maximum amount identified in the fiscal year ending February 29, 2020 is ¥174.10.

4.

Other
(1) Changes in important subsidiaries during the period (changes in specified subsidiaries in accordance withchanges in the scope of consolidation): No(2) Changes in Accounting Policies, Changes in Accounting Estimates, and Restatements
1) Changes of accounting principles in line with revisions to accounting and other standards: No
2) Changes of accounting principles other than 1) above: No
3) Changes in accounting estimates: No4) Retrospective restatement: No(3) Number of shares issued and outstanding (common shares)
1. Number of shares issued and outstanding as of the end of the period (including treasury stock)
As of February 28, 2019: 29,331,356 shares
As of February 28, 2018: 29,331,356 shares
2. Number of treasury stock
As of February 28, 2019: 6,234,634 shares
As of February 28, 2018: 3,669,847 shares
3. Average number of shares for the year
FY2018: 25,415,080 shares
FY2017: 25,559,070 shares
Notes:
1. The number of recorded treasury stock includes 61,800 of the Company’s shares held by the YONDOSHIHOLDINGS Group Employees’ Shareholding Association Trust (hereinafter referred to the “the Trust”) and 50,000of the Company’ shares held by the Shares Grant Trust for Officers as of the end of the fiscal year.
2. For additional information on the basic number of shares used to calculate consolidated net income per share, pleaserefer to “Per Share Information” on page 21.

* The financial statement summary is not subject to auditing by certified public accountants or audit firms.
* Explanation concerning the Proper Use of Operating Results Forecasts and Other Relevant Specific Items
1. The forecasts of operating results and other items concerning the future contained in this document are basedon management’s assumptions and beliefs that are determined to be reasonable in light of currently available
information, YONDOSHI HOLDINGS INC. cautions readers that due to a variety of factors actual results― 2 ―may differ materially from forecasts. For the assumptions that underpin operating results forecasts as wellas cautionary notes on the use of operating results forecasts, please refer to the information from page 6.
2. The Company plans to hold a financial results briefing on April 10, 2019 (Wednesday) for institutional
investors and analysts. Presentation materials used that day will be posted to the Company’s website
promptly after the briefing.
3. The Company has changed its presentation method from the Japanese calendar year to the western calendar
year effective from the Consolidated Financial Report for the fiscal year ended February 28, 2019.

― 3 ―Contents
1.

Overview of Business Results

5(1)Overview of Business Results for the Fiscal Year Ended February 28, 20195

(2)

Overview of Financial Condition as of February 28, 20195

(3)

Overview of Cash Flows for the Fiscal Year Ended February 28, 20196

(4)

Outlook6(5)

Policy on the Appropriation of Profits, Cash Dividends for Fiscal 2018 and Fiscal 20197

2.

Basic Stance on Selection of Accounting Standards

7

4.

Consolidated Financial Statements and Major Notes

8(1)

Consolidated Balance Sheets

8(2)

Consolidated Statements of Income and Consolidated Statements of Comprehensive Income

10

Consolidated Statements of Income

10

Consolidated Statements of Comprehensive Income

11

(3)

Consolidated Statements of Changes in Net Assets

12

(4)

Consolidated Statements of Cash Flows

14

(5)

Notes to Consolidated Financial Statements

16(Notes Regarding Going Concern Assumptions)16(Change in Presentation Method)

16(Additional Information)

16(Segment Information)

17(Per Share Information)

21(Important Subsequent Events)

22

4.

Other

23

(1)

23

Changes in Management― 4 ―1. Overview of Business Results(1) Overview of Business Results for the Fiscal Year Ended February 28, 2019
In fiscal 2018, the fiscal year ended February 28, 2019, the Japanese economy recovered at a moderate paceowing to improvement in corporate earnings and employment conditions, though the outlook remained clouded
as a result of such factors as the impact that ongoing trade issues will have on the global economy.
Despite signs of an improvement in personal consumption, business conditions remained difficult in theretail industry. In addition to persistent budget-consciousness arising from uncertainty about the future, thislargely reflected the impact of natural disasters and other factors.
Under these circumstances, during the fiscal year ended February 28, 2019, the first year of the fifth
medium-term management plan, the YONDOSHI HOLDINGS Group continued to cultivate human resources,
bolster product capabilities, and assess market trends, with the aim of becoming a century-old company andbrand. Further, the Company pursued CSR-based management to establish a highly trusted corporate group andworked to enhance enterprise value by strengthening internal controls, providing shareholder returns, andmaking medium to long-term investments linked to earnings growth.
As a result, net sales for the fiscal year under review amounted to ¥47,118 million (down 2.0% comparedwith the previous fiscal year. From a profit perspective, operating income came to ¥4,984 million (down 18.3%
YoY) and ordinary income was ¥6,804 million (down 10.0% YoY). Profit attributable to owners of parent fell
to ¥2,440 million (down 53.9% YoY), due mainly to the recording of temporary tax expenses stemming fromthe transfer shares of an affiliated company.
Operating results by business segment were as follows.
Jewelry BusinessIn the F.D.C. Products Group, which is largely responsible for the YONDOSHI HOLDINGS Group’s Jewelry
Business, results were impacted by the time required to bring about a recovery in bridal jewelry. At the sametime, sales fell below plans over the December Christmas peal period of demand. Meanwhile, signs of a positive
turnaround are beginning to emerge on the back of the Group’s vigorous efforts to promote a variety of measuresin the bridal jewelry business.
Accounting for each of these factors, net sales in the Jewelry Business segment for the fiscal year underreview amounted to ¥29,295 million (down 5.4% YoY), and operating income came to ¥4,465 million (down
18.4% YoY).
Apparel BusinessIn the Apparel Business, the AS’TY Group achieved positive returns through its successful efforts to strengthen
measures with major clients utilizing its product proposal capabilities and overseas production framework.
Retailer age Co., Ltd. also achieved revenue gains from expanded openings of new locations for its mainstay
everyday fashion brand PALETTE and measures aimed at strengthening sales promotions.
As a result, net sales in the Apparel Business segment amounted to ¥17,822 million (up 4.4% YoY), with
operating income of ¥603 million (up 6.5% YoY).
(2) Overview of Financial Condition as of February 28, 2019
(Current Assets)
Current assets as of the end of the fiscal year under review stood at ¥20,572 million, up ¥1,026 million
compared with the end of the previous fiscal year. Major movements during the fiscal year ended February 28,
2019 included an increase of ¥2,631 million in accounts receivable ― other and a decrease of ¥2,450 million in
short-term investment securities.
(Noncurrent Assets)
Noncurrent assets came to ¥39,361 million as if February 28, 2019, a decrease of ¥7,413 million comparedwith the previous fiscal year-end. This decrease was primarily due to the drop in investment securities of ¥6,437
million.
(Current Liabilities)
Current liabilities stood at ¥10,013 million as of the end of the fiscal year under review, up ¥1,974 million
compared with the end of the previous fiscal year. While certain accounting line items including notes andaccounts payable ― trade declined ¥494 million, this increase was mainly due to the upswing in income taxes
payable of ¥2,606 million.
― 5 ―(Noncurrent Liabilities)
Noncurrent liabilities were ¥6,332 million as of February 28, 2019, an increase of ¥1,450 million comparedwith the balance as of February 28, 2018. This increase was essentially due to the upswing in deferred tax
liabilities of ¥1,545 million.
(Net Assets)
Total net assets as of the end of the fiscal year under review came to ¥43,587 million, down ¥9,811 million
compared with the end of the previous fiscal year. While the valuation difference on available-for-sale securities
increased ¥3,419 million, this downturn largely reflected the increase in treasury stock of ¥6,869 million(decrease in net assets) and the drop in retained earnings of ¥6,123 million.
(3) Overview of Cash Flows for the Fiscal Year Ended February 28, 2019
Cash and cash equivalents as of the end of the fiscal year under review stood at ¥3,749 million, a decreaseof ¥2,276 million compared with the end of the previous fiscal year.
(Cash Flows from Operating Activities)
Net cash provided by operating activities amounted to ¥1,664 million, down ¥3,763 million compared withthe previous fiscal year. In the fiscal year under review, the major cash inflow was income before income taxesof ¥6,202 million. The principal cash outflow was income taxes paid of ¥4,337 million.
(Cash Flows from Investing Activities)
Net cash provided by investing activities totaled ¥5,407 million, a turnaround of ¥8,430 million year on
year. The major cash inflows included proceeds from sales of shares in affiliated companies of ¥7,725 million.
Main cash outflow was for the purchase of investment securities of ¥3,515 million.
(Cash Flows from Financing Activities)
Net cash used in financing activities came to ¥9,344 million, up ¥7,679 million compared with the previous
fiscal year. This largely reflected outflows for the purchase of treasury stock of ¥7,278 million and cash
dividends paid of¥1,851 million.
(4) Outlook
Operating conditions throughout the retail sector are expected to be difficult. Despite the transition to a new era
following the emperor’s abdication of his thrown to his eldest son, and the positive flow-on effects from the2020 Tokyo Olympic and Paralympic Games, this anticipated difficulty is largely due to the ongoing forecast
frugality stemming from consumers’ anxieties regarding the future as a result of scheduled increase in Japan’s
consumption tax rate in October 2019 and other factors.
Against this backdrop, and as a part of efforts to become a century-old company and brand, the YONDOSHIHOLDINGS Group recognizes the critical need to further enhance the value of its corporate 4°C brand.
YONDOSHI HOLDINGS has identified “Challenge and Change” as the key slogan under its Fifth three-year“Challenge and Change” Medium-Term Management Plan, which began from the fiscal year ended February
28, 2019. Guided by this plan, the YONDOSHI HOLDINGS Group will actively reinforce human resources in
the mainstay Jewelry Business and enhance the quality of management. In addition, to increasing the value ofthe 4°C brand, the YONDOSHI HOLDINGS Group will also look to develop and nurture new business pillars
that will help to secure renewed growth.
In the future, the YONDOSHI HOLDINGS Group will continue to cultivate human resources, bolster
product capabilities, and assess market trends. Every effort will also be made to practice CSR-based management
to establish a highly trusted corporate group, while endeavoring to enhance corporate value by strengthening
internal controls, providing shareholder returns, and making medium- to long-term investments linked toearnings growth.
Taking each of these factors into consideration, net sales are projected to come in at ¥47,300 million,
operating income to total ¥5,100 million, ordinary income to come to ¥5,400 million, and profit attributable toowners of parent to amount to ¥3,400 million on a consolidated basis in the fiscal year ending February 29, 2020.
Historically, YONDOSHI HOLDINGS has positioned ordinary income as an important management
indicator keeping in mind the Company’s equity in earnings of affiliates. With the absence of any impact fromthe Company’s equity in earnings of affiliates following a reorganization of its business, YONDOSHIHOLDINGS has positioned operating income before the amortization of goodwill as an important management― 6 ―indicator while emphasizing the need to management profit on a cash basis. Operating income before theamortization of goodwill is projected to come in at ¥5,600 million.
(5) Policy on the Appropriation of Profits, Cash Dividends for Fiscal 2018 and Fiscal 2019
The YONDOSHI HOLDINGS Group places the appropriation of profits to shareholders as a key management
priority. As a result, the Group maintains the basic policy of delivering stable and sustainable cash dividends.
At the same time, the Group adopts a flexible policy toward the purchase of treasury stock as a part ofcomprehensive efforts to increase the level of returns to shareholders. In addition to maintaining its focus oncontinuously increasing dividends each consecutive fiscal year, the YONDOSHI HOLDINGS Group also had apolicy to lift the dividend payout ratio to 30%. Through these means, the Group is working vigorously to lift thelevel of returns to shareholders.
Based on this policy, YONDOSHI HOLDINGS plans to pay a fiscal year-end cash dividend of ¥37.5 percommon share. Together with the interim cash dividend paid of ¥37.5 per common share, the full fiscal year
cash dividend for fiscal 2018 will therefore come in a ¥75 per common share. This will enable the Company toachieve its dividend payout ratio target of 30%. On this basis, the dividend payout ratio is projected to come in
at 78.1%. Meanwhile, YONDOSHI HOLDINGS undertook the large-scale purchase of its own shares during
the fiscal year under review. Through a TOB, the Company acquired 3,253,733 shares of treasury stock,
representing 11.1% of the total number of shares issued and outstanding.
Turning to dividends for the fiscal year ending February 29, 2020, YONDOSHI HOLDINGS plans to pay
an interim and fiscal year-end cash dividend of ¥40 per common share for a full fiscal year cash dividend of ¥80
per common share, representing a ninth consecutive fiscal year of cash dividend growth. Moreover, the Company
will proactively pursue efforts aimed at flexibly purchasing treasury stock. Following the purchase of 130,000
shares of treasury stock in March, the Company resolved to acquire additional treasury stock to a maximum of
1,350,000 shares at a meeting of its Board of Directors held on April 10, 2019. For details of “Important
Subsequent Events,” please refer to page 22 of this document.
As far as the Company’s retained earnings are concerned, YONDOSHI HOLDINGS will work to secure
the internal reserves necessary to reinforce its management structure in response to an increasingly competitiveenvironment, cultivate new business, and pursue business development through a variety of vehicles including
M&As. Through these means, the Company will make every effort to improve the Group’s profitability whilebolstering its management and business platforms.
2. Basic Stance on Selection of Accounting Standards
The YONDOSHI HOLDINGS Group prepares its consolidated financial statements in accordance with Japanese
Generally Accepted Accounting Principles. With respect to International Financial Reporting Standards (IFRS),
the YONDOSHI HOLDINGS Group will respond adequately with consideration of the situation in Japan andoverseas.

― 7 ―3. Consolidated Financial Statements and Major Notes(1) Consolidated Balance Sheets(Thousands of yen)
End of the Fiscal Year Ended

End of the Fiscal Year Ended

February 28, 2018

February 28, 2019

(As of February 28, 2018)(As of February 28, 2019)ASSETS
Current assets:
Cash and deposits

2,076,174

2,249,713

Notes and accounts receivable ― trade

3,061,207

2,854,913

Short-term investment securities

3,950,000

1,500,000

Merchandise and finished goods

8,332,336

8,508,050

Work in process

507,681702,245

Raw materials and supplies

633,136

918,177

Deferred tax assets

451,362

677,461

Advance payments-trade

20,38615,121

Accounts receivable-other

208,924

2,940,309

Other

208,191

210,806

Allowance for doubtful accounts(2,686)(3,894)

19,546,714

20,572,905

Total current assets
Noncurrent assets:
Property, plant and equipment:
Buildings and structures, net

5,918,332

5,475,184

Land

5,492,215

5,492,215

Lease assets, net

68,89842,124

Other, net

737,940

617,817

12,217,387

11,627,343

Goodwill

4,220,291

3,723,786

Lease assets

70,923

155,643

Right of trademark

2,284

1,932

Other

48,83042,484

4,342,329

3,923,847

Investment securities

25,768,779

19,331,649

Guarantee deposits

258,778

253,664

Long-term loans receivable

15,852

11,673

Deferred tax assets

581,650

603,531

Total property, plant and equipment
Intangible assets:

Total intangible assets
Investments and other assets:

Deferred tax assets for land revaluation

71,49071,490Real estate for investment, net

449,269

444,681656,629590,394

Lease deposits
Claims provable in bankruptcy, claims provable inrehabilitation and other
Other

Net defined benefit asset

1,887,682

1,984,453

78,681

72,233553,047

545,501

Allowance for doubtful accounts(107,030)(98,934)

Total investments and other assets

30,214,831

23,810,339

Total noncurrent assets
Total assets― 8 ―46,774,548

39,361,529

66,321,262

59,934,434

(Thousands of yen)
End of the Fiscal Year Ended

End of the Fiscal Year Ended

February 28, 2018

February 28, 2019

(As of February 28, 2018)(As of February 28, 2019)

LIABILITIESCurrent liabilities:
Notes and accounts payable ― trade

4,077,362

3,582,950

Lease obligations

114,551

86,097

Income taxes payable

856,205

3,462,965

Provision for bonuses

251,351

214,097

Provision for directors’ bonuses

13,3008,210

Asset retirement obligations

34,406

20,532Other

2,691,766

2,638,693

Total current liabilities

8,038,943

10,013,546

Noncurrent liabilities:
Long-term loans payable

277,470

175,440

Lease obligations

85,364

149,319

Long-term guarantee deposited

325,381

327,896

2,048,576

3,593,671

Net defined benefit liability

568,010507,346

Provision for directors’ retirement benefits

416,528－－

43,1291,012,744

1,040,398

148,733

495,727

Deferred tax liabilities

Provision for directors' stock benefits
Asset retirement obligations
Other
Total noncurrent liabilities
Total liabilities

4,882,809

6,332,929

12,921,753

16,346,476

NET ASSETS
Shareholders’ equity:
Capital stock

2,486,520

2,486,520

Capital surplus

18,182,008

18,057,092

Retained earnings

37,503,586

31,382,385

Treasury stock(6,310,953)(13,180,010)

Total shareholders’ equity

51,861,161

38,743,987

Valuation difference on available-for-sale securities

1,425,917

4,845,462

Deferred gains or losses on hedges(20,418)(1,338)

Revaluation reserve for land

(161,985)(161,985)

Foreign currency translation adjustments

78,63869,516

Remeasurements of defined benefit plans

116,129

1,846

1,438,281

4,753,501

Accumulated other comprehensive income:

Total accumulated other comprehensive income
Subscription rights to shares
Total net assets
Total liabilities and net assets― 9 ―100,066

90,46953,399,509

43,587,958

66,321,262

59,934,434

(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income
Consolidated Statements of Income(Thousands of yen)
Fiscal 2017

Fiscal 2018

(March 1, 2017 to(March 1, 2018 to

February 28, 2018)

February 28, 2019)

Net sales

48,060,394

47,118,256

Cost of Sales

20,010,594

19,962,301

Gross profit

28,049,799

27,155,954

Selling, general and administrative expenses

21,947,186

22,171,177

Operating income

6,102,613

4,984,777

Non-operating income
Interest income

23,262

43,626

Dividends received
Equity in earnings of affiliates

92,74793,4401,230,794

677,825

Gain on valuation of derivatives－

893,413

Rent of real estate for investment

73,14073,140Foreign exchange gains

12,85812,885

Other

37,28355,732

1,470,087

1,855,063

Total non-operating income
Non-operating expenses
Interest expenses

174

753

Depreciation on investments in real estate

4,685

4,678

Management cost on real estate for investment

2,073

1,918

Commission for purchase of treasury shares－

25,058

Other

3,304

3,102

Total non-operating expenses

10,23835,511

7,562,462

6,804,329

Ordinary income
Extraordinary income
Gain on sales of change in equity
Gain on sales of investment securities
Total extraordinary income

259,796－－244,854259,796244,854

Extraordinary loss
Impairment loss

160,412

320,485－

490,851

Loss on closing of stores

34,30835,829Loss on liquidation of brands

21,566－

Total extraordinary losses

216,287

847,166

Net income before income taxes

7,605,971

6,202,016

Income taxes ― current

1,887,092

4,366,067

Income taxes ― deferred

425,878(604,730)

Total income taxes

2,312,970

3,761,337

Net income

5,293,000

2,440,679

Profit attributable to owners of parent

5,293,000

2,440,679

Loss on sales of shares of subsidiaries and associates― 10 ―

Consolidated Statements of Comprehensive Income(Thousands of yen)
Fiscal 2017

Income before minority interests

Fiscal 2018

(March 1, 2017 to(March 1, 2018 to

February 28, 2018)

February 28, 2019)

5,293,000

2,440,679
3,522,534

Other comprehensive income
Other valuation difference on available-for-sale securities

324,251

Deferred gains or losses on hedges
Foreign currency translation adjustments(37,063)

19,0795,697(9,122)Remeasurements of defined benefit plans, net of tax

130,350

1,671(95,784)(218,942)

327,451
5,620,452

3,315,220
5,755,899

5,620,452

5,755,899－－

Share of other comprehensive income of associates accounted
for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of the parent
Comprehensive income attributable to non controllinginterests― 11 ―

(3) Consolidated Statements of Changes in Net Assets
Fiscal 2017 (March 1, 2017 to February 28, 2018)(Thousands of yen unless otherwise stated)
Shareholders’ equity

Balance at the end of previous period

Commonstock

CapitalsurplusRetainedearnings

Treasury
stock

Total
shareholders’equity2,486,520

18,145,727

33,727,198(6,510,635)

47,848,810

Changes of items during the period
Dividends from surplus
Profit attributable to owners ofparentPurchase of treasury stock(1,516,613)(1,516,613)

5,293,000

5,293,000
(510)

(510)

250,119

286,399(49,925)(49,925)

Disposal of treasury stock
Change in equity in affiliates
accounted for by equity methodtreasury stock
Net changes in items excluding
shareholders’ equity during theperiodTotal—

36,2803,776,387

199,682

4,012,350

Balance at the end of current period

2,486,520

18,182,008

37,503,586(6,310,953)

51,861,161

36,280(Thousands of yen unless otherwise stated)
Accumulated other comprehensive income

Balance at the end of
previous period
Changes of items during
the period
Dividends fromsurplusProfit attributable toowners of parent
Purchase of treasury
stock
Disposal of treasury
stock
Change in equity inaffiliates accounted
for by equity methodtreasury stock
Net changes in items
excludingshareholders’ equity
during the period
Total
Balance at the end ofcurrent period

Valuationdifferenceonavailablefor-salesecurities

Deferred
gains orlosses onhedges

Revaluation
reserve forland

Foreigncurrencytranslation
adjustments

Remeasurementsof defined benefit
plans

Total
accumulated
othercomprehensive
incomeSubscrip-tion
rights tosharesTotal net
assets

1,336,181

16,959(161,985)

72,940(153,265)

1,110,829

114,815

49,074,456(1,516,613)
5,293,000(510)
286,399(49,925)

89,736(37,377)—

5,697

269,395

327,451(14,749)

312,70289,736(37,377)—

5,697

269,395

327,451(14,749)

4,325,053

1,425,917(20,148)(161,985)

78,638116,129

1,438,281

100,066

53,399,509― 12 ―

Fiscal 2018 (March 1, 2018 to February 28, 2019)(Thousands of yen unless otherwise stated)
Shareholders’ equity

Balance at the end of previous period

Commonstock

CapitalsurplusRetainedearnings

Treasury
stock

Total
shareholders’equity2,486,520

18,182,008

37,503,586(6,310,953)

51,861,161

Changes of items during the period
Dividends from surplus
Profit attributable to owners ofparentPurchase of treasury stock(1,851,629)(1,851,629)

2,440,679

2,440,679(7,278,598)(7,278,598)

427

150,195

150,623(125,343)

951,553

836,209

(192)

(192)

(702,014)(7,414,266)

Disposal of treasury stock
Change in purchase of treasury
stock from affiliates accounted forby equity method
Change in equity in affiliates
accounted for by equity methodtreasury stock
Change of scope of equity method
Net changes in items excluding
shareholders’ equity during theperiodTotal—(124,915)(6,123,201)(6,869,057)(13,117,174)

Balance at the end of current period

2,486,520

18,057,092

31,380,385(13,180,010)

38,743,987(6,712,251)(Thousands of yen unless otherwise stated)
Accumulated other comprehensive income

Balance at the end of
previous period
Changes of items during
the period
Dividends fromsurplusProfit attributable toowners of parent
Purchase of treasury
stock
Disposal of treasury
stock
Change in purchase oftreasury stock fromaffiliates accounted
for by equity method
Change in equity inaffiliates accounted
for by equity methodtreasury stock
Change of scope ofequity method
Net changes in items
excludingshareholders’ equity
during the period
Total
Balance at the end ofcurrent period

Valuationdifferenceonavailablefor-salesecurities

Deferred
gains orlosses onhedges

Revaluation
reserve forland

Foreigncurrencytranslation
adjustments

Remeasurementsof defined benefit
plans

Total
accumulated
othercomprehensive
incomeSubscrip-tion
rights tosharesTotal net
assets1,425,917(20,418)(161,985)

78,638116,129

1,438,281

100,066

53,399,509(1,851,629)
2,440,679(7,278,598)
150,623
836,209(192)(7,414,266)
3,419,545

19,079—(9,122)(114,283)

3,315,220(9,596)3,305,623

3,419,545

19,079—(9,122)(114,283)

3,315,220(9,596)(9,811,550)

4,845,462(1,338)(161,985)

69,516

1,846

4,753,501

90,46943,587,958― 13 ―

(4) Consolidated Statements of Cash Flows(Thousands of yen)
Fiscal 2017

Fiscal 2018

(March 1, 2017 to(March 1, 2018 to

February 28, 2018)

February 28, 2019)

Cash Flows from Operating Activities:
Net Income before income taxes

7,605,971

6,202,016

Depreciation and amortization

1,116,072

1,123,617

Impairment loss

160,412

320,485

Amortization of goodwill

496,504

496,504(790)(6,888)(100,100)(37,253)

Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in net defined benefit liability

66,468

4,014

Increase (decrease) in other provision(13,640)(378,488)

Interest and dividends income(116,010)(137,066)

174

753

Interest expenses
Equity in (earnings) losses of affiliates(1,230,794)(677,825)

Loss (gain) on change in equity(259,796)―

Foreign exchange losses (gains)

11,964(7,240)Loss (gain) on valuation of derivatives―(898,413)

Loss (gain) on sales of investment securities(2)(244,854)

Loss (gain) on sales of shares of subsidiaries and associates―

490,851

77,347

212,443(469,336)(660,998)

Decrease (increase) in notes and accounts receivable ― trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable ― trade122,038(493,945)

Increase (decrease) in accrued consumption taxes(88,522)(46,831)

Increase (decrease) in advances received(82,569)(96,828)

Increase (decrease) in accounts payable - other(93,382)

74,550Decrease (increase) in other assets(154,084)

99,859

Increase (decrease) in other liabilities

76,810366,831

7,124,736

5,705,296

255,613296,613

(174)

(753)

Income taxes paid

(1,952,933)(4,337,036)

Net cash provided by (used in) operating activities

5,427,241

1,664,119

SubtotalInterest and dividends income received
Interest expenses paid

― 14 ―

(Thousands of yen)
Fiscal 2017

Fiscal 2018

(March 1, 2017 to(March 1, 2018 to

February 28, 2018)

February 28, 2019)

Cash Flows from Investing Activities:
Purchase of property, plant and equipment(1,178,341)(592,260)

Proceeds from sales of property, plant and equipment

4,782

876

Purchase of intangible assets(6,352)(16,945)(2,017,135)(3,515,235)

2

2,017,654

200,000――

7,725,625

Payments of long-term loans receivable(700)(1,480)

Collection of long-term loans receivable

3,946

5,659

Purchase of long-term prepaid expenses(39,528)(27,352)

Other payments(127,770)(239,066)

Purchase of investment securities
Proceeds from sales of investment securities
Proceeds from redemption of investment securities
Proceeds from sales of shares of subsidiaries and associates

Other proceeds
Net cash provided by (used in) investing activities

137,337

49,764(3,023,759)

5,407,238(101,470)(102,030)(510)(7,278,598)

Cash Flows from Financing Activities:
Repayment of long-term loans payable
Purchase of treasury stock
Proceeds from sales of treasury stock

158,903

36,105(1,516,613)(1,851,629)(205,828)(148,710)(1,665,519)(9,344,863)(7)(2,955)

Net increase (decrease) in cash and cash equivalents

737,955(2,276,460)

Cash and cash equivalents at beginning of period

5,288,219

6,026,174

Cash and cash equivalents at end of period

6,026,174

3,749,713

Cash dividends paid
Other payments
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents― 15 ―

(5) Notes to Consolidated Financial Statements(Notes Regarding Going-Concern Assumption)
Not applicable.
(Change in Presentation Method)
Through the fiscal year ended February 28, 2018, “Treasury Stock (held by Employee Stock Ownership Trust)”
was presented as a breakdown item of “Treasury Stock.” However, because of a decline in the materiality of thisbreakdown item, “Treasury Stock” is presented as a single sum item for the fiscal year ended February 28, 2019.
Consolidated financial statements for the fiscal year ended February 28, 2018 have been restated to reflect thischange in presentation method.
In addition, “Sales of treasury stock from Employee Ownership Trust” was presented as an individual
accounting line item through the fiscal year ended February 28, 2018. However, because of a decline in its
materiality, this item has been included in and presented as “Disposal of treasury stock” from the fiscal year
ended February 28, 2019. Consolidated financial statements for the fiscal year ended February 28, 2018 havebeen restated to reflect this change in presentation method.
As a result, the balance at the end of previous period of negative ¥370,400 million, Sales of treasury stockfrom Employee Stock Ownership Trust of ¥92,738 million, Total of ¥92,738 million, and Balance at the end ofcurrent period of negative ¥277,662 million presented in Treasury stock (held by Employee Stock Ownership
Trust) in the Consolidated Statements of Changes in Net Assets for the fiscal year ended February 28, 2018 havebeen included in and presented as Treasury Stock.
(Additional Information)(Transactions to Provide Company Stock to Employees through a Trust)
The Company has introduced an employee stock ownership plan trust (“ESOP trust”) as an incentive toemployees to increase medium- to long-term corporate value, conducting transactions to provide Company stock
to employees’ shareholding association through a trust.
i. Transaction summary
The Company established a trust with the beneficiaries as employees who participate in the YONDOSHIHOLDINGS Employees’ Shareholding Association (“the Shareholding Association”) and satisfy certain
requirements. The trust acquires Company stock in an amount expected to be procured by the Shareholding
Association over a five-year period, and sells the shares to the Shareholding Association on a fixed date eachmonth. When the trust is concluded, if the trust has earned a profit from a rise in the share price, the funds are
distributed to the employee beneficiaries in proportion to their contribution. If a loss is incurred due to a decline
in the share price, and debt pertaining to the trust property remains, in accordance with the guarantee article in
the loan agreement the Company will discharge the entire debt to the bank, with no additional burden placed on
employees.
ii. Matters concerning the Company’s stock held in the trust
Company stock remaining in the trust is recorded as treasury shares under net assets at book value to the trust(excluding ancillary expenses). At the end of the subject fiscal year, the book value of the subject treasury shareswas ¥277,662 thousand, for 100,600 shares at the end of the previous consolidated fiscal year, and ¥170,572
thousand, for 61,800 shares at the end of the subject consolidated fiscal year.
iii. Book value of debt recorded through application of the gross method
At the end of the previous consolidated fiscal year: ¥277,470 thousandAt the end of the subject consolidated fiscal year: ¥175,440 thousand(Elimination of the Retirement Bonuses for Directors Program)
The Company, at the 68th annual shareholders meeting held on May 17, 2018, decided to make a final paymentof retirement bonuses associated with the elimination of the retirement bonuses for directors program.
Accordingly, the entire amount of the “Provision for directors’ retirement benefits” was reversed, and the¥328,818,000 unpaid portion of the final payment shown in the “Other” item of noncurrent liabilities as “Longterm accounts payable – other.”― 16 ―

(Stock Compensation Plan for Directors)
Under its 68th annual shareholders meeting held on May 17, 2018, the Company introduced a stockcompensation plan (hereinafter, the “Plan”), with eligible persons the Company’s directors (excluding directors
who are audit and supervisory committee members) and directors who are audit and supervisory committee
members (excluding outside directors), as well as directors and corporate auditors (excluding outside corporate
auditors) of the Company’s major group companies from November 28, 2018.
i. Summary of the transaction
The Plan is a stock compensation plan to grant the Company’s shares to eligible directors of eligible companies
in accordance with rules for granting trust-based stock compensation to corporate officers as determined by theeligible companies. The Company will contribute funds to the trust, and the trust will use these funds to acquire
the Company’s shares, and grant them to eligible directors. In principle, directors and other officers will receive
the Company’s shares at the time of retirement.
ii. The Company’s own shares held in the Trust
The Company’s own shares held in the Trust are recorded as treasury stock under net assets at their book value
in the Trust (excluding the amount of ancillary expenses). The book value and number of shares of such treasury
stock as of the end of the fiscal year under review were ¥126,692 thousand and 50,000 shares, respectively.

(Segment Information)
1. Overview of Reporting Segments
The Group’s reporting segments are regularly reviewed by the Board of Directors using the segregatedfinancial information available within each segment to determine the allocation of management
resources and evaluate business results.
Based on the major products handled, the YONDOSHI HOLDINGS Group has identified theJewelry Business and the Apparel Business as its two reporting segments.
(1) Jewelry Business
F.D.C. Products Inc. and its subsidiary companies engage in the comprehensive development ofbrand businesses. This includes the design, manufacture and sale of various products focusing mainly
on jewelry and bags. The F.D.C. Products Group’s principal brands include 4°C, canal4°C,
EAUDOUCE4°C and Luria 4°C.
(2) Apparel Business
AS’TY Inc. and its subsidiary companies engage in apparel business development activities.
Responsible for the manufacturing and apparel functions that draw on its design and marketing
capabilities, the AS’TY Group maintains an overseas production network in such countries as China,
Vietnam and Bangladesh while marketing products mainly through major apparel outlets, specialty
stores and general merchandise stores. age Co., Ltd. is active in the retail business focusing mainly on
women’s clothes, fashion accessories and practical clothing. The company’s is largely undertaken inWestern Japan.
2. Calculation Methods for Net Sales, Profit and Loss, Assets, Liabilities and Other Items by Reporting
Segment
The accounting treatment methods for reporting segments are generally the same as those adopted for
preparing consolidated financial statements. Profits for reporting segments are operating income amounts.
Intrasegment sales and transfers are based on current market prices.

― 17 ―

3. Information Regarding Net Sales, Profit and Loss, Assets, Liabilities and Other Items by Reporting
Segment
Fiscal 2017, the Fiscal Year Ended February 28, 2018 (March 1, 2017 to February 28, 2018)(Thousands of yen)
Reporting Segments

Net sales
Net sales to outside
customers
Intrasegment net sales andtransfers
Total
Segment income
Segment assets
Other items
Depreciation
Increase in property, plantand equipment andintangible assets

Total

Amount recordedon consolidated
quarterlystatements ofincome (Note 2)

Adjustment
amount(Note 1)

Jewelry BusinessApparel Business

30,980,826

17,079,568

48,060,394―

48,060,394

1,145

1,006,384

1,007,980(1,007,980)―

30,981,972
5,469,632
34,852,323

18,086,403
566,996
23,409,774

49,068,375
6,036,629
58,262,098(1,007,980)
65,984
8,059,164

48,060,394
6,102,613
66,321,262

737,324

358,710

1,096,035

20,036

1,116,072

473,665

728,265

1,201,930

28,1291,230,060

Notes:
1. (1) The adjustment amount of ¥65,984 thousand for segment income mainly includes amortization of goodwill totaling minus¥496,504 thousand, general administrative expenses that are not attributable to individual reporting segments amounting tominus ¥465,745 thousand and eliminations of inter-segment transactions of ¥1,030,848 thousand.
(2) The adjustment amount of ¥8,059,164 thousand for segment assets is mainly comprised of an inter-segment offset amount
totaling minus ¥20,340,063 thousand, an adjustment amount for shares of subsidiaries and associates accounted for by theequity method of ¥11,917,036 thousand, corporate assets of ¥12,201,053 thousand and the balance of unamortized goodwillof ¥4,220,291 thousand that are not allocated to each reporting segment. Meanwhile, corporate assets are primarily made up
of surplus operating funds (cash and deposits) that are not attributable to individual reporting segments.
(3) The adjustment amount of ¥20,036 thousand for depreciation and amortization relates to corporate assets that are not
attributable to individual reporting segments.
(4) The adjustment amount of tangible and intangible asset increase of ¥28,129 thousand relates to corporate assets that are
not attributable to individual reporting segments.
2. Segment income matches operating income recorded on the consolidated statements of income.

Fiscal 2018, the Fiscal Year Ended February 28, 2019 (March 1, 2018 to February 28, 2019)(Thousands of yen)
Reporting Segments

Net sales
Net sales to outside
customers
Intrasegment net sales andtransfers
Total
Segment income
Segment assets
Other items
Depreciation
Increase in property, plantand equipment andintangible assets

Total

Amount recordedon consolidated
quarterlystatements ofincome (Note 2)

Adjustment
amount(Note 1)

Jewelry BusinessApparel Business

29,295,873

17,822,383

47,118,256―

47,118,256

1,194

1,009,904

1,011,099(1,011,099)―

29,297,067
4,465,061
25,441,365

18,832,288
603,896
33,980,524

48,129,356
5,068,958
59,421,889(1,011,099)(84,180)
512,545

47,118,256
4,984,777
59,934,434

704,592

398,559

1,103,152

20,465

1,123,617

462,352

403,213865,565

29,460895,026

Notes:
1. (1) The adjustment amount of minus ¥84,180 thousand for segment income mainly includes amortization of goodwill totaling
minus ¥496,504 thousand, general administrative expenses that are not attributable to individual reporting segments
amounting to minus ¥558,956 thousand and eliminations of inter-segment transactions of ¥971,280 thousand.
(2) The adjustment amount of ¥512,545 thousand for segment assets is mainly comprised of an inter-segment offset amount
totaling minus ¥17,996,798 thousand, corporate assets of ¥14,790,786 thousand and the balance of unamortized goodwill of¥3,723,786 thousand that are not allocated to each reporting segment. Meanwhile, corporate assets are primarily made up of
surplus operating funds (cash and deposits) that are not attributable to individual reporting segments.
(3) The adjustment amount of ¥20,465 thousand for depreciation and amortization relates to corporate assets that are not
attributable to individual reporting segments.

― 18 ―

2.

(4) The adjustment amount of tangible and intangible asset increase of ¥29,460 thousand relates to corporate assets that are
not attributable to individual reporting segments.
Segment income matches operating income recorded on the consolidated statements of income.

(Related Information)
Fiscal 2017, the Fiscal Year Ended February 28, 2018 (March 1, 2017 to February 28, 2018)
1. Product and Service Information
As the same information is disclosed in the Segment Information, product and service information has been
omitted.

2. Geographical Segment Information
i. Net sales
As the total of operating revenues to outside customers based in Japan of all business segments represented over
90% of the Company’s total operating revenues in the consolidated statements of income, geographicalinformation has been omitted.
ii. Property, plant and equipment
As the total of property, plant and equipment based in Japan of all business segments represented over 90% of theCompany’s property, plant and equipment in the consolidated balance sheets, geographical information has been
omitted.

3. Information by Major Customer
This information has been omitted because there are no specific customers to whom sales exceed 10% or more of
the total operating revenues posted in the consolidated statement of income.

Fiscal 2018, the Fiscal Year Ended February 28, 2019 (March 1, 2018 to February 28, 2019)
1. Product and Service Information
As the same information is disclosed in the Segment Information, product and service information has been
omitted.

2. Geographical Segment Informationiii. Net sales
As the total of operating revenues to outside customers based in Japan of all business segments represented over
90% of the Company’s total operating revenues in the consolidated statements of income, geographicalinformation has been omitted.
iv. Property, plant and equipment
As the total of property, plant and equipment based in Japan of all business segments represented over 90% of theCompany’s property, plant and equipment in the consolidated balance sheets, geographical information has been
omitted.

3. Information by Major Customer
This information has been omitted because there are no specific customers to whom sales exceed 10% or more of
the total operating revenues posted in the consolidated statement of income.

(Information Concerning the Impairment loss of Noncurrent Assets by Reporting Segment)
Fiscal 2017, the Fiscal Year Ended February 28, 2018 (March 1, 2017 to February 28, 2018)(Thousands of yen)
Reporting Segments
Jewelry BusinessImpairment loss

142,623

Apparel Business
17,789― 19 ―

Adjustment
amountTotal
160,412―

Total

160,412Fiscal 2018, the Fiscal Year Ended February 28, 2019 (March 1, 2018 to February 28, 2019)(Thousands of yen)
Reporting Segments
Jewelry BusinessImpairment loss

277,238

Apparel Business
43,247

Adjustment
amountTotal
320,485―

Total

320,485(Information Concerning the Amount of Goodwill Amortized and the Balance of Unamortized
Goodwill by Reporting Segment)
Fiscal 2017, the Fiscal Year Ended February 28, 2018 (March 1, 2017 to February 28, 2018)
There were no amounts of goodwill amortized or balance of unamortized goodwill allocated to reporting
segments. The amounts of goodwill amortized and balance of unamortized goodwill not allocated to reporting
segments were ¥496,504 thousand and ¥4,220,291 thousand, respectively. The amounts of goodwill amortizedand balance of unamortized goodwill related to goodwill that arose at the time of stock exchange.
Fiscal 2018, the Fiscal Year Ended February 28, 2019 (March 1, 2018 to February 28, 2019)
There were no amounts of goodwill amortized or balance of unamortized goodwill allocated to reporting
segments. The amounts of goodwill amortized and balance of unamortized goodwill not allocated to reporting
segments were ¥496,504 thousand and ¥3,723,786 thousand, respectively. The amounts of goodwill amortizedand balance of unamortized goodwill related to goodwill that arose at the time of stock exchange.

(Information Concerning the Gain on Negative Goodwill by Reporting Segment)
Fiscal 2017, the Fiscal Year Ended February 28, 2018 (March 1, 2017 to February 28, 2018)
Not applicable.
Fiscal 2018, the Fiscal Year Ended February 28, 2019 (March 1, 2018 to February 28, 2019)
Not applicable.

― 20 ―

(Per Share Information)(Yen)
Fiscal 2017
(March 1, 2017 to February 28, 2018)

1.
2.
3.

Net assets per share
Earnings per share
Net income per share (diluted)

Fiscal 2018
(March 1, 2018 to February 28, 2019)

2,077.02
207.09206.801.
2.
3.

1,883.28
96.03
96.01

Net assets per share
Earnings per share
Net income per share (diluted)

Notes: 1. The basis for calculating earnings per share and net income per diluted share is presented as follows:(Thousands of yen unless otherwise stated)
Fiscal 2017
(March 1, 2017 to
February 28, 2018)

Total earnings per share
Profit attributable to owners of parent
Amounts not applicable to ordinary shareholders
Profit attributable to owners of parent applicable to common
stock
Average number of common shares (Shares)

Fiscal 2018
(March 1, 2018 to
February 28, 2019)

5,293,000—

2,440,679—

5,293,000

2,440,679

25,559,070

25,415,080—
35,177(35,177)
New share subscription rights
issued on July 6, 2015
8th issuance of new sharesubscription rights
Common stock:
92,600 shares—
5,673(5,673)New share subscription rights
issued on July 6, 2015
8th issuance of new sharesubscription rights
Common stock:85,800 shares

Net income per share adjusted for diluted shares
Adjustment to profit attributable to owners of parent per share
Increased number of common shares (Shares)(Subscription rights to shares)
Description of the diluted shares not included in the calculationof net income per share adjusted for diluted shares due to their
non-dilutive effect from the previous fiscal year

New share subscription rights
issued on November 22, 2018
11th issuance of new sharesubscription rights
Common stock:
34,500 shares
New share subscription rights
issued on November 22, 2018
12th issuance of new sharesubscription rights
Common stock:
28,200 shares

2. The basis for calculating net assets per share is presented as follows:(Thousands of yen unless otherwise stated)
Fiscal 2017
(March 1, 2017to
February 28, 2018)

Total net asset recorded on consolidated balance sheets
Deduction amount of total net asset recorded on consolidatedbalance sheets
Subscription rights to shares
Net assets applicable to common stock
Number of common stock utilized for the calculation of net assets
per share (Shares)

Fiscal 2018
(March 1, 2018to
February 28, 2019)53,399,509

43,587,958

100,066

90,469(100,066)
53,299,442(90,469)
43,497,488

25,661,509

23,096,722

3. The Company’s shares held by the Trust and the Company’ shares held by the Shares Grant Trust for Officers arerecognized as treasury stock in the consolidated financial statements. As a result, the number of common shares as ofthe end of the period used to calculate the aforementioned net assets per share amount as well as the average numberof shares for the period used to calculate the aforementioned earnings per share amount are after deducting theCompany’s shares held by the trust-type employee ownership plan.

― 21 ―(Important Subsequent Events)(Repurchase of the Company’s Own Shares)
YONDOSHI HOLDINGS resolved to repurchase the Company’s own shares pursuant to Article 156 of
the Corporations Law of Japan as applied under Article 165-3 of the said Corporations Law, following
a meeting of its Board of Directors held on April 10, 2019.
1. Reasons for repurchasing the Company’s own sharesThis resolution was made to ensure that the Company maintained a flexible capital policy that is
capable of appropriately addressing changes in its operating environment and to facilitate theadequate return of profits to shareholders.
2. Repurchase details(1) Class of shares to be repurchased:(2) Total number of shares to be repurchased:(3) Aggregate cost of share repurchase:(4) Repurchase method:(5) Repurchase period:

YONDOSHI HOLDINGS’ common shares
Up to a maximum of 1,350,000 shares
Up to a maximum of ¥3,500,000,000
1. Repurchase through the ToSTNeT-3 off-hours
trading system
2. Market purchase based on a trust agreement
relating to repurchase of the Company’s own shares
April 11, 2019 to September 30, 2019

(Decrease in the Amount of Capital Reserve)
YONDOSHI HOLDINGS resolved to put forward a proposal to decrease the amount of the Company’s
capital reserve at its 69th Annual General Meeting of Shareholders scheduled to be held on May 16,
2019 following a meeting of its Board of Directors held on April 10, 2019.
1. Purpose for decreasing the amount of the Company’s capital reserve
YONDOSHI HOLDINGS is looking to decrease the amount of its capital reserve pursuant to Article
448 paragraph 1 of the Corporations Law of Japan and transfer the amount of decrease to theCompany’s other capital surplus in order to raise the necessary funds to cancel treasury stock and torealize a flexible and agile capital policy.
2. Outline of the decrease in the amount of the Company’s capital reserve(1) Amount of decrease of the Company’s capital reserve
The Company’s capital reserve of ¥14,838,777,130 will be decreased by ¥14,600,000,000 to¥238,777,130.
(2) Method of decreasing the amount of the Company’s capital reserve
YONDOSHI HOLDINGS will decrease its capital reserve and transfer the amount of decrease to theCompany’s other capital surplus.
3. Schedule for the decrease in the amount of the Company’s capital reserve(1) Date of resolution by the Board of Directors:
April 10, 2019(2) Date of resolution by the Annual General Meeting of Shareholders:
May 16, 2019(3) Planned public notice on creditors’ statements of objection:
May 31, 2019(4) Planned deadline for creditors’ statements of objection:
June 30, 2019(5) Effective date of the decrease in the amount of the Company’s capital reserve: July 1, 2019― 22 ―

4. Other(1) Changes in Managementi. Changes in representative director
Not applicable.
ii. Other management assignments (scheduled effective date: May 16, 2019)
Scheduled retirement of a director (excluded Audit/Supervisory Committee member)
Ichiro Ibaraki― 23 ―