Summary of Consolidated Financial Statements for Fiscal Year 2019 (IFRS)
November 12, 2019
Exchange: First Section of Tokyo Stock Exchange
Name of listed company:

GMO Payment Gateway, Inc.

Stock code:

3769

URL:

Representative:
Contact:

Issei Ainoura
Ryu Muramatsu

https://corp.gmo-pg.com/en/

President & Chief Executive Officer
Director, Executive Vice President

Scheduled date for the holding of the ordinary
general shareholders’ meeting

December 15, 2019

Scheduled submission date of securities report

December 16, 2019

Supplemental materials prepared for financial
results:Yes

Information meeting arranged related tofinancial results:Yes (for institutional investors and analysts)

Tel:+81-3-3464-0182

Scheduled date of commencementfor dividend payment

December 16,
2019(Amounts rounded down to the nearest one million yen)

1.

Consolidated Financial Statements for the Term Ended September 2019
(From October 1, 2018 to September 30, 2019)(1) Consolidated Financial Statements

FY 2019
FY 2018

ProfitTotal
attributable toProfit after tax
comprehensive
owners ofincomeparentMillionMillionMillionMillion
yen
%
yen
%
yen
%
yen
%
8,039 20.0
5,052 19.0
5,267 23.8
4,426 △27.3
6,700 86.8
4,246 74.8
4,255 75.8
6,085 124.7

Profit before
Operating profit
income taxes

Revenue
Millionyen
32,121
26,417(Percentages represent year-on-year % change)

Millionyen%
8,301 26.7
6,550 65.9

%
21.6
25.5

Ratio of Profit
Diluted earnings
attributable toper shareowners of parent toTotal equity
Yen
Yen
%
71.61
70.09
20.5
57.75
57.46
19.1

Basic earnings per
share
FY 2019
FY 2018
Reference:

Equity in earnings of affiliates:

FY2019△19 Million yen

Ratio of Profit
before income
taxes to Total
assets%6.3
6.7
FY2018Operating profit
margin%25.8
24.8△203 Million yen(Note) On October 1, 2018, the company executed a 2-1 stock split. The values for FY2018 are calculated on the same basis.

(2) Consolidated Financial Position
Total assets

FY 2019
FY 2018

Million yen
139,990
116,858

Total equity
Total equity
Total equity
attributable toattributable toTotal equity
attributable toowners of parent to owners of parent
owners of parent
per share
total assets
Million yen
Million yen%
Yen
27,53926,49418.9
360.1726,02024,79621.2
336.65(Note) On October 1, 2018, the company executed a 2-1 stock split. The values for FY2018 are calculated on the same base.

(3) Consolidated Cash Flows
Cash flow from operating
activities
Million yen
FY 2019
1,311
FY 2018
4,701
2.

Cash flow frominvesting activities
Million yen
858△8,296

Cash flow from
Closing balance of cash
financing activities
and cash equivalents
Million yen
Million yen
7,959
52,01318,06742,033

Dividends
Full-year dividend

FY 2018
FY 2019
FY 2020(forecast)End of Q1 End of Q2 End of Q3 Year-end
Yen
Yen
Yen
Yen
0.00
0.00
0.00
58.00
0.00
0.00
0.00
36.00
0.00

0.00

0.00

42.00

Ratio of
Dividend
dividends to net
payout ratio
assets(consolidated)Total(consolidated)
Yen Million yen
%
%
58.00
2,154
50.2
9.6
36.00
2,674
50.3
10.3
Total
dividend
amount

42.00

50.6

(Note) On October 1, 2018, the company executed a 2-1 stock split. The values for FY2018 are calculated on the same base.

―1―

3.

Consolidated Financial Forecast for the Fiscal Year Ending September 2020
(From October 1, 2019 to September 30, 2020)(Percentages represent year-on-year change)

Revenue

2Q of FY2020(cumulative)
Full Year

Operating profit

Profitattributable to Basic earnings
Profit after tax
owners ofper share
parentMillionMillion
%
yen
%
yen
%
Yen

Profit before
income taxes

Millionyen%

Millionyen%

Millionyen

17,116

6.9

4,363

2.5

4,122

△0.3

2,597

1.9

2,533

-1.7

34.44

36,61814.0

10,376

25.0

9,867

22.8

6,216

23.0

6,110

16.0

83.06

―2―

Notices:(1)

Changes of important subsidiaries during the period (change of specific subsidiaries that leads to a change in thescope of consolidation): No(2)

Changes in the accounting policy / changes in the accounting estimation[1] Changes in accounting policy required by IFRS.: Yes[2] Changes in accounting policy other than [1]: No[3] Changes in accounting estimations: No(3)

Number of shares issued (common stock)
FY2019: 74,301,000
FY 2018: 74,301,000[1] Number of shares issued at the end of the term(including treasury stock)
FY 2018: 5,000[2] Number of treasury shares at the end of the term FY2019: 5,076[3] Average number of shares during the term
FY2019: 73,562,191
FY2018: 73,680,448(quarterly average)(Note 1) Number of treasury shares at the end of the term includes the shares attributed to the directors’
remuneration board incentive plan (BIP) trust and J-ESOP: 639,400 shares for FY2018 and 734,205 sharesfor FY2019.)(Note 2) On October 1, 2018, the company executed a 2-1 stock split. The shares issued at start of the previous
term are calculated by assuming the post-split number of shares.

Number of new subsidiaries: - (Name:

Reference:1.

),

Number of excluded subsidiaries: - (Name:)

Summary of Non-consolidated Financial Statements

Non-consolidated Financial Statements for the Term Ended September 2019
(From October 1, 2018 to September 30, 2019)(1) Non-consolidated Financial Statements
Revenue
FY 2019
FY 2018

Million yen
16,34814,139

%
15.6
21.8

Basic earnings per
share(Percentages represent year-on-year % change)

Operating profit

Ordinary profit

Million yen
5,867
3,868

Million yen
6,700
4,695

%
51.6
11.5

Million yen
4,416
3,952

%
11.7
32.9

Diluted earnings per
share

Yen
60.04
53.64

FY 2019
FY 2018

Net profit
%
42.7
14.9

Yen
57.32
52.86

(Note) On October 1, 2018, the company executed a 2-1 stock split. The values for FY2018 are calculated on the same base.

(2) Non-consolidated Financial Position
Total assets
Million yen
97,261
79,929FY 2019
FY 2018
Reference:

Owner’s equity

FY2019Total equity

Equity ratio

Million yen
22,40921,67022,409 Million yen

Total equity per share
%
23.0
27.1

FY2018Yen
304.64294.21
21,670 Million yen

Note

1. Non-consolidated financial results are based on J-GAAP standards.
2. The company has been applying “Partial Amendments to Accounting Standard for Tax Effect Accounting” (ASBJ Statement No.
28 on February 16, 2018) from the beginning of the consolidated fiscal year under review. Individual figures for the fiscal year
period ended September 30, 2018 have had this accounting standard applied retroactively.
3. On October 1, 2018, the company executed a 2-1 stock split. The total equity per share calculated for FY2018 are calculatedon the same basis.

* These financial statements are not subject to the review procedures.
* Notes regarding the appropriate use of financial forecast and other important notes
1. The above forecasts are outlooks based on information currently available, and include various uncertain factors. Actual performance
may differ substantially from the forecasts due to changes in business conditions and other factors. For the assumption on which
financial forecasts are based and matters to be considered in using financial forecasts, please refer to “(5) Review of consolidated
earnings forecasts and other forecasts” under “1. Qualitative Information on Consolidated Financial Statements for the Fiscal Year” onpage 11 of the attachment.
2. Results Presentation Meeting for Institutional Investors and Analysts to be held on November 14, 2019. Supporting materials and avideo of the presentation will be made available on the company's website after the event.

―3―

○Table of contents of attachment
１．Qualitative Information on Consolidated Financial Statements for the Fiscal Year……………………………….
（１）Consolidated operating
results……………………………………………………………………………………………………………………..…..
（２）Status of consolidated financial position………………………………………………………………………....

559（３）Status of consolidated cash flows…………………………………………………………………………………. 10（４）Basic Policy of Profit Distribution and Dividends ……………………………………………………………...… 10（５）Review of consolidated earnings forecasts and other forecasts……………………………………………….

11

2．Management Policy………………………………………………………………………………………………………..

12

3．Basic Stance on Accounting Standard Selection………………………………………………………………………. 13
4．Condensed consolidated Financial Statements and Major Notes……………………………………………………. 14（１）Condensed Consolidated balance sheet…………………………………………………………………………. 14（２）Condensed Consolidated statement of income and statement of comprehensive income…………………. 16（３）Condensed Consolidated statement of changes in equity……………………………………………………… 18（４）Condensed Consolidated statement of cash flows……………………………………………………………… 19（５）Notes regarding the going concern assumptions………………………………………………………………..

21（６）Notes regarding condensed consolidated financial statement…………………………………………………. 21④ Cash and cash equivalents……………………………………………………………………………………… 21⑤ Operating and other receivables………………………………………………………………………………... 21⑥ Deposits to subsidiaries and affiliates………………………………………………………………………….. 21⑦ Segment Information……………………………………………………………………………………………..

22⑧ Impairment Loss………………………………………………………………………………………………….

23⑨ Treatment of Financial Assets and Liabilities…………………………………………………………………

24⑪ Per share information……………………………………………………………………………………………

24

―4―

1. Qualitative Information on Consolidated Financial Statements for the Fiscal Year
(1) Consolidated operating results
Forward-looking statements in the document are based on the judgement of the Group at the end of the fiscal year
under review.
① Consolidated operating results
The Group announces its earnings results for the consolidated fiscal year 2019 (October 1, 2018 to September
30, 2019) as follows.
(Unit: Thousand Yen)
Previous consolidated
fiscal year
(From October 1, 2017
To September 30, 2018)

Current consolidated
fiscal year
(From October 1, 2018
to September 30, 2019)

Rate of change (%)

Revenue

26,417,320

32,121,894

21.6

Operating profit

6,550,904

8,301,220

26.7

Profit before income taxes

6,700,079

8,039,076

20.0

4,255,069

5,267,465

23.8

Profit attributable toowners of parent
a. Revenue

The Group’s revenue surged to ¥32,121 mil., up by 21.6% YoY. The Payment Processing Business revenue
grew 27.1% YoY thanks to the steady growth of the E-Commerce (hereafter “EC”) market and with the
expansion of the Group’s services to non-EC operators. Our Money Service Business (MSB) revenue grew
19.6% YoY from the strong trends seen in GMO Payment After Delivery transactions, a type of deferredpayment service, and the Remittance service. The Payment Enhancement Business revenue grew 8.8% YoY
driven by the growth at Macro Kiosk, the Group’s consolidated subsidiary that provides a comprehensive
service of mobile payment and mobile authentication and notification.
Our revenue breakdown by business model is as follows.
With the adoption of IFRS 15 effective from the start of this consolidated fiscal year 2019, the softwaredevelopment revenue for the payment processing service is recognized as prorated over the life of the service
provision period, compared to the previous lump sum method booked at point of delivery inspection. As such,the software development revenue has been reclassified from Initial to Stock. The amount reclassified from
Initial to Stock is ¥709 mil. in the cumulative consolidated fiscal year. There is no retroactive reclassification
applied as the adjustment of the cumulative effect from the initial application of IFRS 15 is made against
Retained Earnings balance at the start of this consolidated fiscal year 2019.
(Unit: Thousand Yen)
Business model
Initial(Initial revenue)

Previous consolidated
fiscal year
(From October 1, 2017
to September 30, 2018)
1,501,377

Current consolidated
fiscal year
(From October 1, 2018
to September 30, 2019)
1,409,663△6.1

Rate of change (%)

Stock(Monthly revenue)
Fee(Transaction processing
revenue)
Spread(Merchant acquiring
service revenue)

3,445,115

4,916,518

42.7

10,364,887

12,101,091

16.8

11,105,940

13,694,620

23.3

Total

26,417,320

32,121,894

21.6

―5―

b. Operating profit
The Group’s operating profit reached ¥8,301 mil., up by 26.7% YoY, which was slightly higher than the Group’s
consolidated fiscal year forecast.
By segment, Payment Processing Business segment profit (operating profit) was ¥10,031 mil., up by 24.4%
YoY; Money Service Business segment profit stood at ¥1,972 mil., up by 43.2% YoY; and, Payment
Enhancement Business recorded a segment loss (operating loss) of ¥1,151 mil. (previous fiscal year was an
operating loss of ¥177 mil.). Note that Payment Enhancement Business segment losses include a one-off loss
amount of ¥992 mil from the impairment loss of Macro Kiosk Berhad.
c. Profit before income taxes
Pre-tax profit was ¥8,039 mil. up by 20.0% YoY, from the reasons stated above in a. and b. Note that financial
income was ¥48 mil. a decline of ¥367 mil. YoY due mainly to gains from investment partnerships. Financial
expense was ¥291 mil., an increase of ¥228 mil YoY due mainly to foreign currency losses. Additionally, equity
method investment losses was ¥19 mil., a decline of ¥184 mil. YoY.
② Results by segment
Performance by reportable segment is explained below.
(Unit: Thousand Yen)
Segment

Previous consolidated
fiscal year
(From October 1, 2017
to September 30, 2018)

Current consolidated
fiscal year
(From October 1, 2018
to September 30, 2019)Year on Year (%)

14,801,499
8,064,804

18,811,705
10,031,752

27.1
24.4

6,254,505
1,377,684

7,478,106
1,972,558

19.6
43.2

5,361,315△177,971

5,832,082△1,151,178

8.8－

Payment Processing Business
Revenue
Operating profit
Money Service Business
Revenue
Operating profit
Payment Enhancement
Business
Revenue
Operating profit
Adjustments
Revenue
Operating profit－－△2,713,612△2,551,911

－
－

Total
Revenue
Operating profit

26,417,320
6,550,904

32,121,894
8,301,220

21.6
26.7

a. Payment Processing Business
The payment processing business primarily comprises of payment processing services for online payment,
recurring payment and, card-present payment.
Secular growth of the Ecommerce market in online payment and recurring payment areas, coupled withfocusing on expanding the Group’s business services to a diverse range of business operators including large
scale merchants and non-EC merchants, resulted in the growth in transaction volume by 29.5% YoY andtransaction value by 26.7% YoY.
In the offline market, sales of payment terminals was strong by capturing the high demand for IC chipembedded credit card terminals as a result of the amendments to the Installment Sales Act. In addition, orders
progressed favorably in the Unattended Market such as automated payment machines and ticket machines.
As a result, segment revenue reached ¥18,811 mil., up 27.1% YoY and segment profit (operating profit) was¥10,031 mil., up 24.4% YoY.
The Ginko Pay service that enables smart payments to be made from the bank account, a support service forbanks and financial service providers to realize their business opportunities in a cashless society, continued toincrease the number of new participants such as The Bank of Okinawa Ltd., Hokuhoku Financial group Inc.

―6―

(The Hokkaido Bank Ltd. and The Hokuriku bank, Ltd.) and, The Hiroshima Bank Ltd., in addition to the other 8banks that have already adopted this payment service platform system. Support services aimed at banks andfinancial service providers, such as Ginko Pay, is showing wider adoption among large regional banks as well
as several large city banks.
In addition, the start of full scale marketing of “stera,” the next generation payment platform jointly developedwith Sumitomo Mitsui Card Co. Ltd and Visa worldwide Japan Co. Ltd, is expected to contribute to the earnings
from the fiscal year ending September 2020 and beyond.

b. Money Service Business
Money Service Business (MSB) consists of the Early Payment Service to help merchants improve their cash
flow by receiving sales proceeds earlier tailored to the merchant’s cash cycle needs, the Transaction Lending
Service to lend growth capital to merchants based on their payment and other related data, the Remittance
Service, and the GMO Payment After Delivery offered by the Group’s consolidated subsidiary GMO Payment
Service, Inc.
In the fiscal year under review, GMO Payment After Delivery and the Remittance Service showed a steadyincrease. In addition, steady growth of financial services that provide diverse support to the growth of B2B EC
operators and the lending services to overseas business operators contributed to the increase in segment
revenues.
As a result, segment revenue reached ¥7,478 mil. an increase of 19.6% YoY and segment profit (operating
profit) reached ¥1,972 mil. an increase of 43.2% YoY boosted by revenue growth and the concerted effort tolower credit costs.

c. Payment Enhancement Business
Payment Enhancement Business comprises of mobile payment services (the “MPS business”) andauthentication and notification services via SMS (the “the EMS business”), provided by our consolidated
subsidiary Macro Kiosk Berhad, and an online advertising service to expand sales of the Group’s merchants byanalyzing their sales status and running timely ads on their behalf based on their sales data.
In the fiscal year under review, Macro Kiosk Berhad’s revenue grew 13.9% YoY, with its mainstay EMS businessgrowing 17.4% YoY, thanks to expanding the service coverage to emerging economies including Vietnam, whichis positioned as a priority market, despite the slowdown in its home market of Malaysia. However, the MPS
business revenue declined 14.2% YoY due to headwinds from changes in its business environment.
An impairment loss of ¥992 mil. has been incurred as a result of impairment testing of Macro Kiosk Berhad’s
goodwill and other assets. Despite the continued revenue growth, the burden of upfront investment to establish
its business foundations in emerging markets has led to uncertainty over the medium term profit outlook at thispoint in time.
However, Macro Kiosk Berhad’s importance in the Group’s overall south east Asia strategy remains unchanged
and given the continued service expansion to financial institutions and business operators in southeast Asian
countries, we continue to pursue the policy to return the company on a path of revenue and operating profit
growth trajectory through cost optimization and revenue expansion of the EMS business.
Online advertising service revenue reached ¥281 mil. a decline of 6.8% YoY due to the slowdown of adplacements in some of the services that were adversely affected by external factors.
Revenues at GMO Epsilon, a consolidated subsidiary that offers delivery services, declined 66.6% YoY to reach¥102 mil. due to adverse changes in the business environment.
As a result of the above, segment revenue was ¥5,832 mil. an increase of 8.8 % YoY and segment losses(operating loss) was ¥1,151 mil. (previous fiscal year segment loss was ¥177mil.).
(*) Note that the “customer support services” has been renamed “online advertising service.”―7―

Please see below for the table of the major businesses and companies providing these businesses by segment.
Segment

Major service

Major companies of the service

Payment processing service
Payment
Processing
Business(Online billing and recurring billing)

GMO Epsilon, Inc. (consolidated subsidiary)

Payment processing service
GMO Financial Gate, Inc. (consolidated subsidiary)(Offline payment)
GMO Payment After Delivery
Money Service
Business

GMO Payment Gateway, Inc.

GMO Payment Service, Inc. (consolidated
subsidiary)
GMO Payment Gateway, Inc.

Remittance service

GMO Epsilon, Inc. (consolidated subsidiary)
GMO Payment Gateway, Inc.

Transaction lending

GMO Epsilon, Inc. (consolidated subsidiary)
GMO Payment Gateway, Inc.

Early Payment service
Payment

Mobile payment, authentication

Enhancement
Business

GMO Epsilon, Inc. (consolidated subsidiary)

Macro Kiosk Berhad (consolidated subsidiary)and notification―8―

(2) Status of consolidated financial position
Assets, liabilities and net assets
a. Assets
Total assets at the end of the consolidated fiscal year under review was up ¥23,131 mil. from the end of theprevious fiscal year end at ¥139,990 mil. This is mainly due to an increase in cash and cash equivalents of¥9,980 mil., an increase in advance payment of ¥10,229 mil., and an increase in accrued income of ¥5,848 mil.
The Group has ¥2,800 mil. deposits to subsidiaries and affiliated companies included in the balance of cash andcash equivalents at the end of this consolidated fiscal year, as stated in “④ Cash and cash equivalents” of (6)Notes regarding condensed consolidated financial statements. Together with the ¥5,000 mil. of deposits to
subsidiaries and affiliated companies stated in the condensed consolidated balance sheet, the total balance of
the Group’s deposits to subsidiaries and affiliated companies stands at ¥7,800 mil. These deposits are theGroup’s cash on hand that is deposited under the cash management system (CMS) implemented and managed
by GMO Internet. As a result, this allows the Group to withdraw necessary funds without the need to wait until
the predetermined CMS repayment date, by registering a request taking into account the designated number ofdays prior to when cash is needed.
b. Liabilities
Balance of liabilities at the end of the consolidated fiscal year under review stood at ¥112,451 mil., an increaseof ¥21,612 mil. from the end of the previous consolidated fiscal year, mainly due to an increase in deposits
received of ¥9,605 mil. and an increase in short term borrowing of ¥11,699 mil.
c. Equity
Equity balance at the end of the consolidated fiscal year under review was ¥27,539 mil., an increase of ¥1,519
mil. from the end of the previous consolidated fiscal year, mainly due to dividend paid out of retained earnings of¥2,136 mil., and share buybacks of ¥689 and the decrease in other comprehensive income of ¥626 mil., despite
the net profits of ¥5,052 mil.

―9―

(3) Status of consolidated cash flows
Cash and cash equivalents (hereinafter called “funds”) increased by ¥9,980 mil. from the balance at the start of
the term, to ¥52,013 mil. The cash flows by activity for the fiscal year under review is discussed below.
a. Cash flow from operating activities
Net funds provided by operating activities in the consolidated fiscal year under review amounted to ¥1,311 mil.,compared to ¥4,701 mil in the same period of previous year. This resulted from cash outflows of (i) increases inadvances paid ¥10,229 mil., (ii) increase in accrued revenues ¥5,848 mil., that was netted against the cash
inflows of (i) profit before tax of ¥8,039 mil., (ii) increase in deposits received ¥ 9,605 mil.
b. Cash flow from investing activities
Net funds provided by investing activities over the consolidated fiscal year under review totaled ¥858 mil.,which compares to a net fund usage of ¥8,296 mil. in the same period of the previous year. This is due to cash
outflow from the acquisition of intangible assets ¥1,356 mil., and deposits to subsidiaries and affiliatedcompanies of ¥5,000 mil., which was netted against the cash inflow from the repayments from deposits to
subsidiaries and affiliated companies of ¥7,000 mil.
c. Cash flow from financing activities
Net funds provided by financing activities over the consolidated fiscal year under review was a ¥7,959 mil.,which compares to ¥18,067 mil. in the same period of the previous year. This is due to cash outflow from
dividend payout of ¥2,134 mil. which was netted against the cash inflow from the net increase in short term
borrowing of ¥11,699 mil.

(4) Basic Policy of Profit Distribution and Dividends
It is the Company’s management task to achieve the balance between the need to secure retained earnings forstrengthening the organization and for business expansion, while continuing to stably return profits to shareholders.
For the term-end dividends for the consolidated fiscal year under review, we have raised the dividend per share by¥1 and revised the full year dividend plan to ¥36, given the current earnings trend and to respond to theshareholder’s expectations on dividends. The previous dividend plan was ¥35 per share as disclosed in the“Summary of Consolidated Financial Statements for the Term Ended September 30, 2018 (IFRS)” announced on
November 12, 2018. (Note 1)
The next fiscal year’s dividend is planned at ¥42 per share, continuing the trend of dividend increase since the start
dividend payments commenced, and reflects the favorable progress of the business plans and our efforts tocontinuously raise the medium-term enterprise value by enhancing shareholder’s returns.
Retained earnings will continue to be used for strengthening the corporate organization as well as aggressive
deployment for business expansion.
The revision to dividends is summarized in the table below.
Full-year dividend
End of Q2
Yen
0.00

End of Q3
Yen
0.00

Term-end
Yen
35.00

Revised plan

-

-

-

36.00

36.00

Current Year

0.00

0.00

0.00

0.00

0.00

0.00

58.00

58.00

Previous Year (Note 2)(Fiscal year ending September 2018)

Note 1:Total

End of Q1
Yen
0.00

Previous plan（as of November 12, 2018）

Yen
35.00

This will be placed on the agenda of the Board of Director’s meeting to be held November 18, 2019.

2: On October 1, 2018, our company executed a 2-1 stock split. The dividend per share for the fiscal year
ended September 2018 is on a pre-split basis.

―10―(5) Review of consolidated earnings forecasts and other forecasts
The Group’s core business is positioned within the E-Commerce market in Japan, and Japan’s BtoC E-Commerce formerchandizing continues to grow very rapidly, helped by favorable externalities such as increased penetration ofsmartphone and logistic/distribution industry reforms, which contribute favorably to support the high growth of thecore business. In addition, we aim to sustain a operating profit CAGR of over 25% in the medium to long term, by
focusing on FinTech domain in the Money Service Business, the cashless domain as cashless penetration rises inline with other advanced countries, IoT domain in the offline market and the global domain.
For the fiscal year ending September 2020, the Group forecasts across-the-board growth in all segments of Payment
Processing Business, Money Service Business and Payment Enhancement Business, through acquisition of large
and high-growth merchants and financial institutions, expanding the financial-related services with Infomart
Corporation, contribution from “stera” the next generation payment platform and also by monetizing new services in
the pipeline.
The earnings forecast for consolidated fiscal year ending September 30, 2020 are as follows: revenue of ¥36,618 mil.
(up 14.0% YoY), operating profit ¥10,376 mil. (up 25.0% YoY), profit before tax ¥9,867 mil. (up 22.8% YoY), profit¥6,216 mil. (up 23.0% YoY), and profit attributable to owners of parent company ¥6,110 mil. (up 16.0% YoY).

―11―

2. Management Policy(1) Basic management policy of the Company
The management principle of the group is to “pursue both spiritual and material prosperity for our partners bycontributing to society.”■ We contribute to the advancement and progress of our society with a strong intention to create and develop markets,and the transparency in expanding business.
■ We define our partners as our employees of high morals, customers and business partners.
■ Our employees possess richness of spirit, advanced problem-solving abilities, and a high level of professionalism.
They always pursue richness of spirit when they exchange values with our customers.
Based on the management principle, our mission is to become the best payment infrastructure in Japan and tocontribute to safe and easy use of payment processing services for merchants and consumers. We are expanding ourbusinesses according to the following management policy:
・Be adaptive to the changing times
Spirit of innovation: We strive to maintain/support technical superiority of our products.
Flexibility: Our project proposals are appropriate for the growing market’s speed
・Establish our raison d’etre
Uniqueness: We strive to maintain the value of our existence through customer-oriented services.
Profitability: We surpass competitors by pursuing revenue growth, and establish an unwavering position in theindustry.
・Pursue all possible conditions for making profit
Sociability: Continue to actively develop greenfield markets for the various method of payments and onlytransact with socially accepted and sound businesses.
Rationality: We always make business judgements quickly and impartially considering important economic
rationality.
・Obligation to shareholders
Strive to maximize shareholder value through improving capital efficiency.
Engage undertake Investor Relations activities to provide our shareholders with prompt and accurate
information.

(2) Targeted Performance Indicators
The Group emphasizes an operating profit growth rate of 25% as a management performance indicator.
For the consolidated fiscal year under review, the operating profit grew at 26.7% YoY including the upfront investments
to sustain the 25% operating profit growth in the medium term. The forecasted operating profit growth for term ending
September 2020 is 25.0% YoY.
As a Group involved in providing the online payment infrastructure to the E-Commerce market, we will continue tocontribute to the expansion of E-Commerce in the regions/countries where we operate, and to contribute to increase
EC penetration by enhancing the security and convenience of the EC environment.

―12―

(3) Challenges to be addressed by the Company①Strengthening the information security
We provide credit card payment processing services, and process and manage material information such as credit
card numbers. As part of the process to strengthen risk management system and prevention of information leaks,
we obtained certifications of ISO/IEC 27001:2013 (Japanese Standards, JIS Q27001: 2014), the global standards
for information security management, for all of our business offices for the first time as a listed payment processing
services company. Consequently, our information security management system has been objectively assessed tobe appropriate and safe in compliance with strict international standards.
With regards to PCI DSS which was jointly established by five international credit card companies: JCB; American
Express; Discover; MasterCard; and VISA, after obtaining the first certification in December 2008, we have passed
annual recertification review nine times and have obtained the latest certification in December 2018.
Meanwhile, with respect to the handling of personal information, we obtained the privacy mark that certifies thecompanies which have improved the system for taking appropriate protection measures for personal information incompliance with the Japanese Industrial Standards “JIS Q 15001:2006 Personal Information Protection
Management System – Requirements.” We have independently established and operate the personal information
protection management system at a high level of protection in a manner that goes beyond mere compliance withthe laws.
②Strengthening the system development capabilities
The group’s business fields are deeply related to the Internet and we recognize that to provide customers withcompetitive products, it is important to adopt competitive technologies and services in a timely manner.
At present, our internal personnel incorporate changes in the system environment or requests from customers into
our system designs and outsource programming work to provide efficient and quality services. We will try tocontinue to secure highly-skilled developers and further strengthen system development capabilities and services.
③Strengthening the collaboration business
We recognize that to ensure stable growth, it is essential to establish mutually-beneficial business collaborations
with corporations covering many merchants, payment companies or Ecommerce website builders to efficiently
acquire new merchants.
The Company is fond of employing the above-mentioned business style, and it will continue to seek more of suchbusiness collaborations, which are and will be tracked by its management team.
④Expansion of business portfolio
As its management strategy, the group has always strived to expand its business domains; we have stretched
online payment fields of our coverage from mainly in B2C Ecommerce to public dues, utility charges, service
commerce, B2B and C2C market space; we have also started a new type of payment service with the founding of
GMO Payment Service Inc. In the previous fiscal year, we strengthened our overseas operations by acquiring
Macro Kiosk Berhad, and expanded offline payment business by turning GMO Financial Gate Inc. into our
subsidiary. We will continue to stretch our multifaceted business portfolio with its core being payment processing
service, and strive to consecutively boost profits.

2. Basic Stance on Accounting Standard Selection
The group plans to voluntarily adopt International Financial Reporting Standards (IFRS) from the current fiscal year
considering its engagement in global business expansion. Migration to IFRS should improve convenience on the partof our various stakeholders including domestic/overseas shareholders and investors, making comparison of our
financial data with overseas peers easier and allowing for more expanded disclosure.

―13―

4. Condensed Consolidated Financial Statements and Major Notes(1) Condensed consolidated balance sheet

Notes

End of previous consolidated
fiscal year
(September 30, 2018)(Unit: Thousand Yen)
End of current consolidated
fiscal year
(September 30, 2019)

AssetsCurrent assets
Cash and cash equivalents
Operating and other receivables④⑤,⑨

42,033,124
13,236,930
22,267,745
15,717,965

Advances paid
Accrued revenue
Inventories
Deposits to subsidiaries and affiliates
Other financial assets
Other current assets⑥

Total current assets

52,013,447
13,663,112
32,496,862
21,566,393

64,5377,000,000
706,745
1,205,270

207,280

102,232,318

121,069,081－
165,584
956,398

Noncurrent assets
Tangible assets
Goodwill and other intangible assets
Investments accounted using equity
methodDeposits to subsidiaries and affiliates⑥

Other financial assets
Deferred tax assets
Other noncurrent assets
Total noncurrent assets
Total assets―14―

450,918

517,509

4,934,688

4,359,129

2,938,426

3,001,692－
5,444,421
833,886

5,000,000

24,297116,082

4,803,089
1,124,014

14,626,639

18,921,518

116,858,957

139,990,599

End of previous consolidated
fiscal year
(September 30, 2018)(Unit: Thousand Yen)
End of current consolidated
fiscal year
(September 30, 2019)

4,663,264

4,688,856

15,740,072
41,228,933

16,118,112
50,834,374

Borrowings
Other financial liabilities

4,101,400
98,85215,800,400
108,534

Income taxes payable, etc.
Provisions

1,530,203
7,388

1,569,616
396,631

Other current liabilities

2,030,282

2,229,923

69,400,397

91,746,449

16,676,929
2,199,100

16,745,648
1,398,700

Other financial liabilities
Provision

185,223
64,055

223,363
35,848Deferred tax liabilities
Other noncurrent liabilities

205,749
2,107,484

85,6042,215,686

Total noncurrent liabilities

21,438,542

20,704,851

90,838,939

112,451,301

Capital stock
Capital surplus

4,712,900
5,758,448

4,712,900
5,847,480

Retained earnings
Treasury stock

12,875,446

15,884,444△491,893
1,941,305△1,181,846
1,231,655

24,796,206

26,494,633

1,223,811

1,044,664

Notes
Liabilities and equity
Liabilities
Current liabilities
Operating and other payables
Accrued expenses
Deposits received⑨⑨

Total current liabilities
Noncurrent liabilities
Corporate bonds
Borrowings

Total liabilities
EquityOther items of equity
Total equity attributable to owners ofparentMinority interests
Total equity

26,020,018

27,539,297

Total liabilities and equity

116,858,957

139,990,599―15―

(2) Condensed consolidated statement of income and consolidated statement of comprehensive income
Condensed consolidated statement of income
Previous consolidated
fiscal year
(from October 1 2017 to
September 30, 2018)
26,417,320(Unit: Thousand Yen)
Current consolidated
fiscal year
(From October 1, 2018
to September 30, 2019)32,121,894

Cost of revenue△9,080,227△11,617,173

Gross profit

17,337,092

20,504,721

165,290

153,725△10,470,657△11,202,292△480,820△1,154,933

Operating profit

6,550,904

8,301,220

Financial income
Financial expense

415,961

48,811△63,370△291,701

Notes
Revenue⑩

Other income
Selling, general and administrative expenses
Other expense⑧

Equity method investment gains or loss

△203,416△19,255

Profit before income taxes
Income tax expenses

6,700,079

8,039,076△2,453,113△2,986,659

Profit4,246,965

5,052,416

Owners of parent
Non-controlling interests

4,255,069

5,267,465△8,104△215,049

Profit4,246,965

5,052,416

Profit attributable toEarnings per share
Basic earnings per share (yen)

⑪

57.75

71.61

Diluted earnings per share (yen)

⑪

57.46

70.09

―16―

Condensed consolidated statement of comprehensive income
Previous consolidated
fiscal year
(from October 1 2017 to
September 30, 2018)
4,246,965(Unit: Thousand Yen)
Current consolidated
fiscal year
(From October 1, 2018
to September 30, 2019)
5,052,416

1,650,239△522,171

117,760△4,912

1,768,000△527,083

88,351△11,968△17,870△87,187

70,480△99,156

1,838,481△626,239

6,085,446

4,426,176

Owners of parent
Non-controlling interests

6,069,762

4,630,496

15,683△204,320

Total

6,085,446

4,426,176

NotesProfitOther comprehensive income
Items that will not be reclassified to profit
or loss
Fair value of financial assets measured
through other comprehensive income
Share of other comprehensive incomeof equity method affiliates
Total of Items that will not be reclassified
to profit or loss
Items that will be reclassified to profit orloss
Exchange differences on translation offoreign operations
Share of other comprehensive incomeof equity method affiliates
Total of items that will be reclassified to
profit or loss
Other comprehensive income after income
taxes
Comprehensive income
Comprehensive income attributable to―17―

(3) Condensed consolidated statement of changes in equity
Consolidated fiscal year (From October 1, 2017 to September 30, 2018)

Notes
Balance as of October 1,
2017ProfitOther comprehensive
incomeComprehensive income
Purchase of treasury
stock
Sale of treasury stock
Dividend
Transfer fromaccumulated othercomprehensive income
to retained earnings
Changes in the interests
in controlled subsidiary
Share-based paymenttransaction
Total transactions withownersBalance as of September
30, 2018(Unit: Thousand Yen)
EquityNonRetained Treasury Other items attributable
Total
controlling
earnings
stockof equity to owners
Equityinterestsof parent

Capitalstock

Capitalsurplus4,712,900

4,985,781

9,619,266△256,269

613,768

19,675,447－－

4,255,069－－

4,255,069△8,1044,246,965

－

－

－

－

1,814,692

1,814,692

23,788

1,838,481－－

4,255,069－

1,814,692

6,069,762

15,683

6,085,446－－－△249,782－△249,782－△249,782－

73,760－14,157－

87,918－87,918－－ △1,485,920

－

－

－

487,030－△487,030

－

－

－

－

△30,707－－－△30,707－△30,707－

186,125

－

－

△125

186,000

24,096210,096－772,666△998,889△235,624△487,155△949,003

114,256△834,746

5,758,448 12,875,446△491,893

1,941,305

24,796,206

4,712,900－ △1,485,920

1,093,870 20,769,318－ △1,485,920

1,223,811 26,020,018

Consolidated fiscal year (From October 1, 2018 to September 30, 2019)

Notes
Balance as of October 1,
2018
Cumulative effects ofchanges in accountingchanges
Restated Balance
ProfitOther Comprehensive
incomeComprehensive income
Purchase of treasury
stock
Dividends
Transfer from other
equity items to retained
earnings
Changes in the interests
in controlled subsidiary
Share-based paymenttransaction
Total transactions withownersBalance as of September
31, 2019(Unit: Thousand Yen)
EquityOther
Nonattributable
items ofcontrolling Total Equity
to owners
equityinterestsof parent

Capitalstock

CapitalsurplusRetainedearnings

4,712,900

5,758,448

12,875,446△491,893－－△195,085－

4,712,900

5,758,448

12,680,361△491,893－－

5,267,465－－

5,267,465-215,049

5,052,416

－

－

－

－

△636,968△636,968

10,728△626,239－－

5,267,465－△636,968

4,630,496-204,320

4,426,176－－－△689,952－△689,952－△689,952－－△2,136,041

－

－

－

72,658－△72,658

－

－

－

－

△8,211－－－△8,211－△8,211－

97,243－－△22

97,22025,172

122,393－

89,032△2,063,382△689,952△72,681△2,736,984

25,172△2,711,811

4,712,900

5,847,480

15,884,444△1,181,846 1,231,655

26,494,633

1,044,664

27,539,297―18―

Treasurystock

1,941,305 24,796,206－△195,085

1,941,305 24,601,121－ △2,136,041

1,223,811 26,020,018－△195,085

1,223,811 25,824,933－ △2,136,041

(4) Condensed consolidated statement of cash flows

Notes

Previous consolidated
fiscal year
(from October 1 2017 to
September 30, 2018)(Unit: Thousand Yen)
Current consolidated
fiscal year
(From October 1, 2018
to September 30, 2019)

6,700,079
965,935
359,469△336,379
203,416

8,039,076
1,113,513
992,503242,889
19,25529,940△142,743

572,142△516,681△5,461,523△10,229,117△3,317,499△5,848,540

1,139,789

131,3022,995,397

278,295

3,821,385

9,605,582

7,388
39,2907,718,835
23,943△39,929－△30,000△67,041△2,904,269

361,036
143,449
4,189,822
48,811△65,4363,000,060△3,120,000－△2,741,613

4,701,537

1,311,644△655,422－－

689,374△77,500△156,181△1,076,813△333,519△1,356,617△204,284

823,10340,611－△102,248

62,991

131,699△7,000,000△5,000,000－

7,000,000

79,200△9,699－△92,867

1,070

9,220

△109,623△100,705△8,296,214

858,000

Net cash provided by (used in) operating
activities
Profit before income taxes
Depreciation & Amortization
Impairment Loss
Financial income and expense
Equity method investment loss
Increase/decrease in inventories(△=increase)
Increase/decrease in operating and otherreceivables (△=increase)
In/Decrease in advances paid(△=increase)
Accrued revenues (△=increase)
In/Decrease in operating payables(△=decrease)
In/Decrease in accrued expenses(△=decrease)
In/Decrease in deposits received(△=decrease)
In/Decrease in provisions(△=decrease)
Other
SubtotalInterest and dividends received
Interest paid
Proceeds from recovery of deposits
Increase in Deposits
Information security expenses paid
Income taxes paid/refunded
Net cash provided by (used in) operating
activities
Net cash provided by (used in) investing
activities
Increase in time deposits
Proceeds from withdrawal of time
deposits
Purchase of property, plants andequipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from sales of investment
securities
Purchase of stock of equity method
affiliate
Proceeds
fromdistributions
from
Investment Partnership
Increase in deposits to subsidiaries andaffiliates
Proceeds from repayment of deposits to
subsidiaries and affiliates
Collection of long-term loans receivables
Acquisition of other financial assets
Proceeds from sales of other financial
assetsOthersNet cash provided by (used in) investing
activities―19―

Previous consolidated
fiscal year
(from October 1 2017 to
September 30, 2018)(Unit: Thousand Yen)
Current consolidated
fiscal year
(From October 1, 2018
to September 30, 2019)

3,300,000

11,699,000△821,156
17,437,403△249,782△1,483,765△115,267△800,400－△689,952△2,134,832△114,795

18,067,432

7,959,019

26,852△148,341

14,499,608

9,980,323④

27,533,515

42,033,124④

42,033,124

52,013,447

Notes
Net cash provided by (used in) financing
activities
In/Decrease of short-term borrowings(△=decrease)
Repayment of long-term borrowings
Proceeds from issue of bonds
Purchase of treasury stock
Dividends paid
Other
Net cash provided by (used in) financing
activities
Effect of exchange rate changes on cash
and cash equivalents
Increase and decrease in cash and cash
equivalents (△=decrease)
Balance of cash and cash equivalents at the
beginning of the period
Cash and cash equivalents at the end of
period―20―

(5) Notes regarding the going concern assumptions
N/A(6) Notes regarding condensed consolidated financial statements④ Cash and cash equivalents
Breakdown of cash and cash equivalents are as follows.
(Unit: Thousand Yen)
End of previous consolidated End of current consolidated
fiscal year
fiscal year
(September 30, 2018)(September 30, 2019)
Cash and cash equivalents

37,033,124

49,213,447

Deposits to subsidiaries
and affiliates

5,000,000

2,800,000

42,033,124

52,013,447

Total⑤ Operating and other receivables

Breakdown of operating and other receivables are as follows.
(Unit: Thousand Yen)
End of previous consolidated End of current consolidated
fiscal year
fiscal year
(September 30, 2018)(September 30, 2019)
Accounts receivable-trade7,262,587

5,663,939

Operating loans

6,063,545

7,514,754

14,613590,916△103,815△106,498

13,236,930

13,663,112

Other
Allowanceaccounts

fordoubtful

Total⑥ Deposits to subsidiaries and affiliates

Our deposits to subsidiaries and affiliates are the deposits under the CMS of the GMO Internet Group

―21―

⑦

Segment Information(2) The accounting policies adopted for the reportable segments are consistent from those applied to theconsolidated financial statements.
Descriptions of each reportable segment are as follows:
Profits of reportable segments is defined as “Operating profits.” Intersegment transaction prices are determined bytaking into consideration the equivalent prices for an arm’s length transaction.

Previous consolidated fiscal year (from October 1, 2017 to September 30, 2018)(Unit: Thousand Yen)
Payment
Processing
Business

Money
ServiceBusiness

Payment
Enhancement
Business

Total

14,801,499

6,254,505

5,361,315

26,417,320－

26,417,320

－

－

－

－

－

－

Total
Segment profit or loss (△denotes loss)
Financial income

14,801,499

6,254,505

5,361,315

26,417,320－

26,417,320

8,064,804

1,377,684△177,971

9,264,517△2,713,612

6,550,904

－

－

－

－

－

415,961

Financial expense
Equity method investment
gains or losses(△ denotes loss)
Profit before Income taxes

－

－

－

－

－

△63,370

－

－

－

－

－

△203,416

－

－

－

－

－

6,700,079

705,020

18,752

137,624

861,397

104,538

965,935－－

359,469

359,469－

359,469

Revenue
Sales to externalcustomers
Intersegment revenue

Other items
Depreciation andamortization
Impairment Loss

Adjustments
Consolidated(Note)(Note) “Adjustment” of segment income (loss) of ¥△2,713 mil., includes corporate expenses of ¥△2,806 mil. andintersegment transactions ¥93 mil. that are unallocated to each reportable segment. The corporate expense consists ofgeneral and administrative expenses that are unallocated to each reportable segment.
Current consolidated fiscal year (From October 1, 2018 to September 30, 2019)(Unit: Thousand Yen)

Revenue
Sales to externalcustomers
Intersegment revenue
Total
Segment profit (△ denotes
loss)
Financial income
Financial expense
Equity method investment
gains or losses(denoted by △)Profit before Income taxes
Other items
Depreciation andamortization
Impairment Loss

Payment
Processing
Business

Money
ServiceBusiness

Payment
Enhancement
Business

Total

18,811,705

7,478,106

5,832,082

32,121,894－

32,121,894

－

－

－

－

－

－

18,811,705

7,478,106

5,832,082

32,121,894－

32,121,894

10,031,752

1,972,558△1,151,178

10,853,132△2,551,911

8,301,220

－

－

－

－

－

48,811

－

－

－

－

－

△291,701

－

－

－

－

－

△19,255

－

－

－

－

－

8,039,076

835,716

46,482160,215

1,042,414

71,099

1,113,513－－

992,503

992,503－

992,503

Adjustments
Consolidated(Note)(Note) “Adjustment” of segment income (loss) of ¥△2,551 mil., includes corporate expenses of ¥△2,647 mil. andintersegment transactions ¥95 mil. that are unallocated to each reportable segment. The corporate expense consists ofgeneral and administrative expenses that are unallocated to each reportable segment.

―22―

⑧ Impairment Loss
Previous consolidated fiscal year (from October 1, 2017 to September 30, 2018)
In the consolidated statement of income for the previous fiscal year, impairment loss amount of ¥359 mil. wasrecorded in the “Other Expenses.” The main asset type that was impaired is shown in the following table.

Reporting Segment

Cash generating unit group

Payment Enhancement
Business

Macro Kiosk Berhad Group

Type and Amount
Goodwill¥359 mil.

At Macro Kiosk Berhad, despite the continued strong performance and sustained growth outlook of its mainstay EMS
business, the MPS revenue declined 14.1% YoY and the adverse market conditions and the competitive landscape
has led to a lowered profit outlook. Hence, we have lowered the carrying value of applicable assets to its recoverable
value, and recorded the impairment loss in the “Other Expenses” of the consolidated statement of income.
The value in use uses the present value which is computed by discounting the estimated cash flow, based on the 5year business plan and growth rates that have been approved by the management. The perpetual growth rate of 2.5%
and discount rate of 15.2% have been used in arriving at the value in use for the cash generating unit that includes
goodwill resulting from the consolidation of Macro Kiosk Berhad.
Current consolidated fiscal year (from October 1, 2018 to September 30, 2019)
In the consolidated statement of income for the consolidated fiscal year under review, impairment loss amount of ¥992
mil. was recorded in the “Other Expenses” of the consolidated statement of income. The main asset type that was
impaired is shown in the following table.

Reporting Segment

Payment Enhancement
Business

Cash generating unit group

Asset Type and Amount

Macro Kiosk Berhad Group

Goodwill¥527 mil.
Technology assets¥123 mil.
Software¥123 mil.
Customer related assets ¥121 mil.
Other
¥97 mil.
Total¥992 mil.

The EMS business revenue at Macro Kiosk Berhad increased due to initiatives to accelerate growth of businesses inemerging markets such as Vietnam, the priority market after Malaysia, despite the business slowdown in the homemarket of Malaysia. On the other hand, the burden of higher expenses arising from the upfront investments carriedout to establish business foundations in emerging economies, has led us to conclude that there is an increased
uncertainty over the medium term profit outlook at this point in time, and thus the carrying amount of the applicable
assets have been reduced to its recoverable asset value. The impairment loss has been recorded in “Other expense”
in the consolidated statement of income. Note that the entire amount of the carrying value of goodwill, technology
assets, software and customer related assets have been impaired.
The value in use uses the present value which is computed by discounting the estimated cash flow, based on the 5year business plan and growth rates that have been revised according to reflect near term financial performance andapproved by the management. The perpetual growth rate of 2.3% and discount rate of 14.3% have been used inarriving at the value in use for the cash generating unit that includes goodwill resulting from the consolidation of Macro
Kiosk Berhad.

―23―

⑨

Treatment of Financial Assets and Liabilities
The Group has the legally enforceable right over some of its financial assets and liabilities to recognize the value ofthe assets and liabilities as a net amount, or to offset the financial assets and liabilities when the transaction ofrealization of the asset and settlement of liabilities is structured and intended to occur simultaneously. For thesereasons, the net amount of the financial assets and liabilities is recognized in the condensed financial statements.
The following table shows the amount used to deduct (offset) the financial assets and liabilities for the same trade
partner.
As of the current consolidated fiscal year (September 30, 2019)

Gross Amount of
Financial Assets

Amount deducted (netted)
in the Condensed Financial
Statement(Unit: Thousand Yen)
Net amount shown inCondensed Financial
Statement

5,024,602△2,799,022

2,225,579

5,024,602△2,799,022

2,225,579

Gross Amount of
Financial Liabilities

Amount deducted (netted)
in the Condensed Financial
Statement(Unit: Thousand Yen)
Net amount shown inCondensed Financial
Statement

Accrued Expenses

15,634,690△598,491

15,036,199

Deposits Received

47,668,605△2,200,530

45,468,074

63,303,296△2,799,022

60,504,273

Financial Asset
Operating andReceivables

Other

Total

Financial Asset

Total
⑪

Per share information(1) Basis of calculating basic earnings per share
The basis for calculating basic earnings per share and earnings per share were as follows:(Unit: Thousand Yen)
Previous consolidated fiscal year
(From October 1, 2017 to
September 30, 2018)

Current consolidated fiscal year
(From October 1, 2018
to September 30, 2019)

4,255,069

5,267,465－－

4,255,069

5,267,465

Weighted average number ofordinary shares

73,680,448 shares

73,562,191 shares

Basic earnings per share¥57.75 per share¥71.61 per share

The basis for calculating basic
earnings per share:
Net profit attributable to ownersof the parent
Amounts not attributable toordinary shareholders of theparentNet profit used to calculate basic
earnings per share―24―

(2) Basis of calculating diluted earnings per share
The basis for calculating diluted earnings per share is as follows:(Unit: Thousand Yen)
Previous consolidated fiscal year
(From October 1, 2017 to
September 30, 2018)

Current consolidated fiscal year
(From October 1, 2018
to September 30, 2019)

4,255,069

5,267,465

15,53546,5404,270,605

5,314,005

73,680,448 shares

73,562,191 shares

641,312 shares

2,252,371 shares

74,321,760 shares

75,814,562 shares¥57.46 per share¥70.09 per share

The basis for calculating diluted
earnings per share:
Net profit used to calculate basic
earnings per share
Adjustments to net profit
Net profit used to calculate diluted
earnings per share
Weighted average number ofordinary shares
Effects of dilutive potential on
ordinary shares (Convertiblebond)Number of ordinary shares after
effects of dilutive potential
Diluted earnings per share(Note) On October 1, 2018, the company executed a 2-1 stock split. The values for earnings per share and diluted earnings per
share are calculated by assuming the stock split to be carried out at the beginning of the previous consolidated fiscal year.

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