Summary of Financial Statements for the First Quarter of Fiscal Year Ending April 2021
[Japan GAAP] (Consolidated)

September 1, 2020

Name of listed company:

AIN HOLDINGS INC.

Exchange listed on:First Section of Tokyo Stock Exchange and Sapporo Securities Exchange

Code number:

9627

URL:

https://www.ainj.co.jp/

Representative:
Inquiries:

Kiichi Otani, President and Representative Director
Toshihide Mizushima, Representative Senior Managing Director
TEL: +81-11-814-1000
Date of filing quarterly securities report:
September 14, 2020–

Start of dividend payment:
Supplementary documents for quarterly results:

Yes (Supplementary materials for the quarterly results are disclosed on the
Company’s website appropriately as the financial statements.)

Quarterly results briefing:

Yes (For institutional investors and analysts)(Amounts are rounded down to the nearest million yen.)
1. Consolidated results for the first quarter of fiscal year ending April 30, 2021 (May 1, 2020 to July 31, 2020)(1) Consolidated operating results(Percentage figures show year-on-year changes.)
Profit attributable to
Net sales
Operating income
Ordinary income
owners of parent
Three months ended July 31, 2020Three months ended July 31, 2019
(Note) Comprehensive income:Million yen%

Million yen%

Million yen%

Million yen%

71,463

(1.4)

1,164

(70.3)

1,654(60.7)

846(62.2)

72,461
11.5
3,921
13.6
4,212
16.7
Three months ended July 31, 2020: ¥852 million (-60.9%)
Three months ended July 31, 2019: ¥2,180 million (+17.6%)

2,240

21.0

Earnings
per share

Diluted earnings
per share
Yen

Yen

Three months ended July 31, 2020

23.90

–

Three months ended July 31, 2019

63.24

–

(2) Consolidated financial position
Total assets
As of July 31, 2020
As of April 30, 2020
(Reference) Shareholders’ equity:

Net assets

Shareholders’equity ratio

Million yen

Million yen%

188,225

109,90758.4

193,451

111,003

As of July 31, 2020: ¥109,830 million

57.3
As of April 30, 2020: ¥110,915 million

2. Dividends

Year ended April 30, 2020

End of firstquarter
Yen–

Dividend per share
End of third
quarterYen–
0.00

End of second
quarter
Yen–
Year ending April 30, 2021
Year ending April 30, 2021
0.00
(forecast)(Note) Revision to the most recently announced dividend forecasts: No–

End of year

Full year

Yen

Yen

55.00

55.00

55.00

55.00

3. Consolidated financial forecasts for the fiscal year ending April 30, 2021 (May 1, 2020 to April 30, 2021)(Percentage figures show year-on-year changes.)
Profit attributable toEarnings
Net sales
Operating income
Ordinary income
owners of parent
per share
Million yen%
Million yen%
Million yen%
Million yen%
Yen
First six
146,630
0.5
4,280 (48.8)
4,460 (49.1)
2,400 (48.1)
67.74
monthsFull year
311,000
6.3
14,600(9.1)
15,000 (10.8)
8,200 (10.7)
231.46(Note) Revision to the most recently announced consolidated financial forecasts: No*Notes(1) Major changes in subsidiaries during the period (changes in specified subsidiaries resulting from changes in scope of
consolidation): No
Newly consolidated: –Excluded: –(2) Application of specified accounting methods for the preparation of quarterly consolidated financial statements: No(Note) For detail, please refer to “2. Quarterly consolidated financial statements and major notes (3) Notes on quarterly
consolidated financial statements” on page 8 of the Attachment.
(3) Changes in accounting principles, changes in accounting estimates, and restatement of revisions
1) Changes in accounting principles as a result of revisions to accounting standards, etc.:
No2) Changes in accounting principles other than 1):
No3) Changes in accounting estimates:
No4) Restatement of revisions:No(4) Number of outstanding shares (common stock)1) Number of outstanding
shares (including treasury
As of July 31, 2020
stock):
2) Number of shares held in
As of July 31, 2020
treasury:
3) Average number ofThree months ended
shares outstanding:July 31, 2020

35,428,212 shares As of April 30, 2020

35,428,212 shares

754 shares As of April 30, 2020

728 shares

Three months ended
July 31, 201935,427,484 shares

35,427,458 shares*This Summary of Financial Statements is outside the scope of quarterly review procedures.
*Statement regarding the proper use of financial forecasts and other special remarks(Caution concerning forward-looking statements)
The above forecasts are calculated based on the information available as of the publication date of this material, and actual
financial results may vary due to change in future economic conditions and others.

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2021

Contents of the Attachment
1. Qualitative information on consolidated results for the period under review............................................................................ 2(1) Consolidated operating results ........................................................................................................................................... 2(2) Consolidated financial position ........................................................................................................................................... 3(3) Forecast of consolidated financial results and other forward-looking information............................................................... 3
2. Quarterly consolidated financial statements and major notes ................................................................................................. 4(1) Quarterly consolidated balance sheet ................................................................................................................................ 4(2) Quarterly consolidated statements of income and comprehensive income ........................................................................ 6
Quarterly consolidated statement of income ....................................................................................................................... 6
Quarterly consolidated statement of comprehensive income.............................................................................................. 7(3) Notes on quarterly consolidated financial statements ........................................................................................................ 8(Notes on the premise of a going concern)......................................................................................................................... 8(Note on significant changes in the amount of shareholders’ equity) ................................................................................. 8(Application of specified accounting methods for the preparation of quarterly consolidated financial statements) ............. 8(Segment information, etc.) .............................................................................................................................................. 8

1

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2021

1. Qualitative information on consolidated results for the period under review(1) Consolidated operating results
During the first three months of the current fiscal year (May 1, 2020 to July 31, 2020), the Japanese economy continued
to face challenging conditions due to the COVID-19 outbreak.
In this economic environment, the AIN HOLDINGS Group (the Group) worked to expand its business and increase
earnings by opening new dispensing pharmacies and cosmetic and drug stores and by reviewing its cost structure.
In addition, the Group took thorough steps to prevent infection in pharmacies and stores to reassure patients andcustomers, and worked to ensure the continued provision of healthcare and retail services by implementing strict measures
to protect employees from infection.
In the first three months of the fiscal year, net sales decreased 1.4% year on year to ¥71,463 million, operating income
decreased 70.3% to ¥1,164 million, ordinary income decreased 60.7% to ¥1,654 million, and profit attributable to owners ofparent decreased 62.2% to ¥846 million.
Financial results by business segment are as follows.
(Dispensing pharmacy business)
The dispensing fee revisions in April this year included adjustments that normalize a greater emphasis on appropriately
evaluating the primary care functions of dispensing pharmacies in each community, as well as revisions aimed at spurring a
structural shift from dispensing focused on products to dispensing focused on services.
In addition, under partial revisions to the Act on Securing Quality, Efficacy and Safety of Products Including
Pharmaceuticals and Medical Devices (Revised Pharmaceuticals and Medical Devices Act), which is being implemented
incrementally, dispensing pharmacists will be required as necessary from September 2020 to ascertain drug treatment andprovide guidance at times other than the point of prescription, and online drug treatment guidance will be permitted
nationwide in accordance with certain rules.
To ensure our pharmacists and dispensing pharmacies fulfill their primary care role, the Group will continue to implement
pharmaceutical management based on the integrated and continuous management of drug-related information throughcooperation with local medical service providers, the use of patient medication notebooks and other means. The Group will
also enhance drug treatment guidance and create a system that enables all dispensing pharmacies to provide online drug
guidance so that every patient can easily access medical services in their local community.
In July 2020, the Group conducted Japan’s first-ever trial of prescription drug deliveries using drones, which were linked
to online medical examination and online drug guidance systems. The trial is aimed at ensuring people in regional
communities who have trouble visiting hospital have continued access to healthcare services in the future.
In business development, the Group is pushing ahead with further business expansion and measures to improve theefficiency of pharmacy operations, including actively opening large pharmacies and tightening the criteria for M&A deals, aswell as using its pharmacy opening strategy to withdraw from small-scale locations.
The number of prescriptions is now recovering after a decline caused by restrictions on outpatient visits amid the COVID19 outbreak.
As a result, for the first three months of the fiscal year, the dispensing pharmacy business reported lower sales and profits
compared with the same period a year earlier. Sales declined 2.9% to ¥62,888 million and segment income fell 28.0% to¥3,458 million.
During the period under review, the Group opened three new dispensing pharmacies, including those acquired throughM&A deals, and closed 10 pharmacies, resulting in a total of 1,081.
(Cosmetic and drug store business)
The cosmetic and drug store business continued to face a challenging market environment due to factors such as theimpact of the COVID-19 outbreak.
Against that backdrop, the Group continued to open ainz & tulpe cosmetic and drug stores in major metropolitan areasand strategically developed retail displays tailored to the characteristics of each store. The Group also launched the official
AINZ & TULPE WEBSTORE to improve convenience and service levels for customers.
As a result, for the first three months of the fiscal year, the cosmetic and drug store business reported sales of ¥4,296
million, down 34.5% year on year and segment loss of ¥292 million compared with the income of ¥230 million a year earlier.
During the same period, the Group opened three ainz & tulpe stores and closed two stores, resulting in a total of 64
cosmetic and drug stores at the end of the period.
(Other businesses)
Net sales from other businesses increased 281.4% year on year to ¥4,308 million, mainly reflecting the acquisition of retailshop business in March 2020, and segment loss was ¥296 million, compared with segment loss of ¥51 million in the same
period a year earlier.
2

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2021

(2) Consolidated financial position
The balance of total assets at the end of the first quarter decreased by ¥5,225 million from the end of the previous fiscal
year to ¥188,225 million. That mainly reflected declines for accounts receivable and cash on hand and in banks.
The balance of liabilities decreased ¥4,129 million to ¥78,318 million. The main factors were an increase in deposits
received, outweighed by declines for accounts payable, accrued income taxes and outstanding debt.
The balance of short- and long-term debts decreased by ¥942 million to ¥5,132 million.
Total net assets decreased by ¥1,096 million to ¥109,907 million and the shareholders’ equity ratio improved 1.1
percentage points to 58.4%.
(3) Forecast of consolidated financial results and other forward-looking information
There are no changes to the Group’s consolidated financial forecasts for the first six months or the fiscal year ending April
30, 2021, which were released on June 4, 2020.
The Group currently expects the COVID-19 outbreak to impact its operations through July 2020. Specifically, thedispensing pharmacy business is seeing a decline in the number of prescriptions due to an increase in the duration ofprescriptions, while the cosmetic and drug store business has been affected by weaker consumer confidence amid calls forpeople to stay at home. In addition, the Group does not expect inbound demand to recover during the current fiscal year.
The Group will revise its forecasts as needed and disclose them in a timely manner in the event of a material change in
conditions, such as the emergence of a COVID-19 second wave.

3

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2021

2. Quarterly consolidated financial statements and major notes(1) Quarterly consolidated balance sheet(Million yen)

AssetsCurrent assets
Cash on hand and in banks
Notes and accounts receivable
Merchandise
Supplies
Short-term loans
Other accounts receivable
Other current assets
Allowance for doubtful accounts
Total current assets
Fixed assets
Property, plant and equipment
Buildings and structures, net
Land
Other property, plant and equipment, net
Total property, plant and equipment
Intangible fixed assets
Goodwill
Other intangible fixed assets
Total intangible fixed assets
Investments and other assets
Investment securities
Deferred tax assets
Deposits and guarantees
Other investments and other assets
Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
Deferred assets
Total assets

4

Fiscal year endedApril 30, 2020
(As of April 30, 2020)Three months ended
July 31, 2020
(As of July 31, 2020)

46,321
13,653
15,035
286
208
8,997
3,299
(1)
87,802

42,128
12,204
15,296
292
135
8,827
3,930
(0)
82,815

16,60910,9603,304
30,874

16,521
10,8683,418
30,80842,123
2,792
44,916

41,303
2,995
44,2992,295
4,211
19,144
5,834(1,644)29,841
105,632
15
193,451

2,296
4,196
19,154
6,293(1,643)30,297
105,405
4
188,225

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2021

(Million yen)

Liabilities
Current liabilities
Accounts payable
Short-term debt
Accrued income taxes
Deposits received
Allowance for bonuses to employees
Allowance for bonuses to directors
Reserve for reward obligations
Other current liabilities
Total current liabilities
Long-term liabilities
Long-term debt
Net defined benefit liability
Other long-term liabilities
Total long-term liabilities
Total liabilities
Net assets
Shareholders’ equity
Common stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Unrealized holding gains on securities
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

5

Fiscal year endedApril 30, 2020
(As of April 30, 2020)Three months ended
July 31, 2020
(As of July 31, 2020)

47,187
3,642
3,356
13,094
2,338
16
463
4,600
74,70045,334
3,171
633
15,364
1,768
8
429
4,289
70,999

2,432
3,124
2,189
7,747
82,447

1,961
3,189
2,167
7,318
78,31821,89420,50068,758(2)
111,151

21,89420,50067,656(2)
110,050

(77)
(159)
(236)
88
111,003
193,451

(72)
(146)
(219)
76
109,907
188,225

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2021

(2) Quarterly consolidated statements of income and comprehensive income
Quarterly consolidated statement of income

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Commissions received
Real estate rental revenue
Consignment income
Subsidies for employment adjustment
Insurance claim income
Other non-operating income
Total non-operating income
Non-operating expenses
Interest expenses
Losses on sales of accounts receivables
Real estate rental expenses
Other non-operating expenses
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of fixed assets
Gain on transfer of business
Other extraordinary income
Total extraordinary income
Extraordinary losses
Losses on disposal and sales of fixed assets
Loss on temporary store closures
Other extraordinary losses
Total extraordinary losses
Profit before income taxes
Income taxes
ProfitLosses attributable to non-controlling interests
Profit attributable to owners of parent

6(Million yen)Three months ended
July 31, 2019
(May 1, 2019 toJuly 31, 2019)72,46160,971
11,4907,568
3,921

Three months ended
July 31, 2020
(May 1, 2020 toJuly 31, 2020)
71,46361,644
9,819
8,655
1,164

14
19
5
211
43
–
1
85
382

11
26
4
40
46
231
138
96
596

19
15
33
22
91
4,212

11
18
44
31
105
1,654

0
117
0
118

12
37
2
52

216
–
22
239
4,092
1,856
2,236
(4)
2,240

101
52
68
222
1,484
649
835
(11)
846

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2021

Quarterly consolidated statement of comprehensive income

ProfitOther comprehensive income:Unrealized holding gains on securities
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests

7(Million yen)Three months ended
July 31, 2019
(May 1, 2019 toJuly 31, 2019)
2,236

Three months ended
July 31, 2020
(May 1, 2020 toJuly 31, 2020)
835

(60)
4
(55)
2,180
2,184

4
12
17
852
864

(4)

(11)

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2021

(3) Notes on quarterly consolidated financial statements(Notes on the premise of a going concern)
There are no applicable matters to be reported.

(Notes on significant changes in the amount of shareholders’ equity)
There are no applicable matters to be reported.
(Application of specified accounting methods for the preparation of quarterly consolidated financial statements)
To calculate tax expenses, the effective tax rate on income before income taxes for the consolidated fiscal year after theapplication of tax effect accounting is reasonably estimated and the estimated rate is applied to income before income taxes
for the quarterly period.
(Segment information, etc.)
I Three months ended July 31, 2019 (May 1, 2019 to July 31, 2019)
1. Net sales and income (loss) by reportable segment
Reportable segments
Adjustments(Note) 1(Million yen)
Carried onquarterly
consolidated
statements ofincome(Note) 2

Dispensing
pharmacybusiness

Cosmetic anddrug store
business

Otherbusinesses(1) Sales to third parties

64,800

6,560

1,100

72,461－

72,461(2) Intersegment sales

－

－

28

28

(28)

－

Total sales

64,800

6,560

1,129

72,490(28)

72,461

Segment income (loss)

4,804

230

(51)

4,982

(770)

4,212

Total

Sales

Notes:

1. The adjustment of ¥(770) million to segment income (loss) includes ¥1,346 million in corporate expenses, ¥(599)
million in (income) loss that is not allocated to reportable segments, and ¥24 million in eliminations due tointersegment transactions.
Corporate expenses consist mainly of expenses associated with the administrative divisions of the parent
company, such as general affairs and accounting departments.
2. Segment income (loss) is adjusted with the ordinary income of quarterly consolidated statements of income.

2. Impairment losses on fixed assets and goodwill by reportable segment[Significant impairment losses on fixed assets]:
There are no applicable matters to be reported.
[Significant changes in the amount of goodwill]:
There are no applicable matters to be reported.

8

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2021

II Three months ended July 31, 2020 (May 1, 2020 to July 31, 2020)
1. Net sales and income (loss) by reportable segment
Reportable segments
Adjustments(Note) 1(Million yen)
Carried onquarterly
consolidated
statements ofincome(Note) 2

Dispensing
pharmacybusiness

Cosmetic anddrug store
business

Otherbusinesses(1) Sales to third parties

62,886

4,296

4,280

71,463－

71,463(2) Intersegment sales

1

－

27

29

(29)

－

Total sales

62,888

4,296

4,308

71,492(29)

71,463

Segment income (loss)

3,458

(292)

(296)

2,869

(1,214)

1,654

Total

Sales

Notes:

1. The adjustment of ¥(1,214) million to segment income (loss) includes ¥1,491 million in corporate expenses, ¥(299)million in (income) loss that is not allocated to reportable segments, and ¥22 million in eliminations due tointersegment transactions.
Corporate expenses consist mainly of expenses associated with the administrative divisions and the system
logistics division of the parent company.
2. Segment income (loss) is adjusted with the ordinary income of quarterly consolidated statements of income.

2. Impairment losses on fixed assets and goodwill by reportable segment[Significant impairment losses on fixed assets]:
There are no applicable matters to be reported.
[Significant changes in the amount of goodwill]:
There are no applicable matters to be reported.

9