Nov 16, 2015

Non-consolidated Financial and Operating Results (Excerpt)
for the Year Ended September 30, 2015 [J-GAAP basis]
Listed Company Name:
SHl-JAPAN Ltd.
Registered on Tokyo Stock Exchange
Securities Code:
4327
URL:
http://www.shl.co.jp/
Representative:
Manabu Nara, Managing Director
Contact:
Naohiro Nakamura, Executive Director        Tel: +81-3-5385-8781
Date to the ordinary general meeting of shareholders:Dec 19, 2015
Date to start distributing dividends:
Dec 21, 2015
Date to submit the Securities Report
Dec 22, 2015
Supplementary documents for this summary of financial statements
Yes
Results briefing for financial results:
Yes (for analysts and institutional investors)
The original disclosure in Japanese was released on October 29, 2015 at 15:15 (GMT+9)
1. Non-consolidated Financial Results for the Year Ended September 30, 2015 (October 1, 2014 to September 30, 2015)(1) Non-consolidated Business Results(The percentages indicate the rate of increase or decrease compared with the same period of the previous fiscal year.)Net sales
Millions ofOperating income

Yen%

Millions ofYen

Ordinary income%Millions ofYenNet income%Millions ofYen%

Fiscal 2015

2,279

9.8926

4.1

939

5.0

588

5.9

Fiscal 2014

2,076

5.58893.68943.6555

0.5

Fully diluted
net income per share

Net income per share

Fiscal 2015
Fiscal 2014

Return on
shareholders’ equity

Ordinary income tototal assets

Operating income tonet sales

YenYen%%%195.88179.75194.38177.99

18.2
18.1

24.7
25.1

40.6
42.8

(Note) ComprehensLYHLQFRPH)LVFDOʊ millon

Fiscal 2014 ʊ millon(2) Non-consolidated Financial Position
Total assets

Net assets

Millions ofYenEquity ratio

Millions of

Sep 30, 2015
4,005
Sep 30, 2014
3,589
(Reference) Equity capital: Sep 30, 2015: ¥3,379 millon

Net assets per share

Yen%

Yen

84.4
86.5

1,117.74
1,027.89

Net cash provided by(used in) financing activities

Cash and cash equivalents at
end of period

3,386
3,116
Sep 30, 2014: ¥3,104 million(3) Non-Consolidated Consolidated Cash FlowsNet cash provided by(used in) operating activities
Millions of

Fiscal 2015
Fiscal 2014

Net cash provided by(used in) investing activities

Yen

Millions of641565

Yen%Yen‫ڹ‬117‫ڹ‬658‫ڹ‬314‫ڹ‬497

2,177
1,967

2. Dividends
Q1
End

Fiscal 2014
Fiscal 2015
Fiscal 2016 (forecast)

Q2
EndDividend per share
Q3
Year-EnEnddAnnual

Yen

Yen

Yen

Yen

Yen

ʊ
ʊ
ʊ

45.00
46.00
49.00

ʊ
ʊ
ʊ

47.00
52.00
49.00

92.00
98.00
98.00

Total dividends
paid (annual)Millions of

Payout ratio(consolidated)

Dividends to net
assets

Yen%%

281
295

51.2
50.0
46.3

9.2
9.1

3. Non-Consolidated Forecast for the Year Ending September 30, 2016 (October 1, 2015 to September 30, 2016
Net salesMillions ofFiscal 2016

Operating income

Yen%

2,368

3.9

Millions of

Ordinary income

Yen%

962

3.9

Millions of

Net income
per share

Net income

Yen%

962

2.5

Millions of

Yen%

Yen6398.7

211.66

*Note(1) Application of particular accounts procedures to the preparation of quarterly non-consolidated financial statements: None
(2) Changes in accounting policies and changes or restatement of accounting estimates(i) Changes in accounting policies caused by revision of accounting standards:None(ii) Changes in accounting policies other than(ϸ) :None(iii)Changes in accounting estimates:None(iv) Restatement:
None
(1)

Number of shares outstanding (common stock)(i) Number of shares outstanding(including treasury shares)

As of Sep 30, 2015

3,023,079

As of Sep 30, 2014

3,101,800(ii) Number of treasury shares

As of Sep 30, 2015ʊ

As of Sep 30, 2014

81,921(iii)Average Number of shares outstanding

Fiscal 2015

3,005,051

Fiscal 2014

3,090,915* Implementation status of quarterly review proceduresThis financial results summary is not subject to review procedures under the Financial Instruments and Exchange Act, and thefinancial statement review procedures based on the Act were in progress at the time of the disclosure of these financial results.

* Explanations and other special notes concerning the appropriate use of financial results forecasts
1.

The forward-looking statements regarding financial results forecasts, etc., appearing in this financial results summary have been
prepared based on information currently available to the Company and certain assumptions that the Company believes to bereasonable. The Company makes no guarantee as to their realization. Actual financial results may differ substantially from theforecasts due to various factors.

2.

As the Company’s services are often used for the screening of new graduates to be employed by corporate customers, our sales
inevitably involve seasonal fluctuations. Accordingly, the Company’s performance management is conducted on an annual basis
without presenting performance forecasts for the first half.

3.

The Company has scheduled a results briefing for security analysts and institutional investors on November 6, 2015. Please referto the IR Information for details of the materials that will be distributed at the session. The materials will be posted on theCompany’s Web site immediately after this meeting
http://www.shl.ne.jp/ir/for_analyst.asp

1. Analysis of Operating Results and Financial Position(1) Analysis of Operating Results(Operating results for the year ended September 30, 2015)
For the year ended September 30, 2015 (October 1, 2014, through September 30, 2015), net sales ofSHL-JAPAN Ltd. (the “Company”) increased ¥203 million, or 9.8% year over year, to ¥2,279 million. By businesssegment, “Product sales” increased 15.2% to ¥1,231 million, “Consultancy sales” increased 2.6% to ¥992 millionand “Training sales” increased 40.3% to ¥55 million.
Product sales for the year under review increased ¥162 million year over year. This increase was primarily
attributable to increased sales of our products such as the “GAB,” which is used for the screening of new graduates
recruited for the main career track. Consultancy sales increased ¥25 million year over year. This increase wasprimarily attributable to favorable sales of customized versions of the “Web Test,” a Web assessment tool, and the“Marksheet Test,” as well as various valuation agency services, or human assessment services, although sales of“Tamatebako,” an Internet-based screening system, were unsatisfactory. Training sales increased ¥15 million year
over year due to increased orders for in-house seminars.
During the year ended September 30, 2015, the employment environment was steady supported by a moderate
recovery trend resulting from a set of economic policies and other factors. Amid this environment, the media
projected an increase for the fifth consecutive year in the informal job offer rate of new graduates to be employedby leading corporations, and corporations conducted aggressive screening of students who are expected to graduate
from universities, etc., in 2016 and of experienced workers. Under these circumstances, the schedules concerning
recruitment-related PR activity and screening for new graduates were delayed compared with previous years, andthe period for recruiting and screening at corporations was substantially shortened in light of the self-imposed
regulations regarding the employment of new graduates* that were introduced by industry groups effective fromthe year under review. Accordingly, the Company achieved increase in revenue in all the business segments for theyear under review due to overall support of our services, particularly those products which are relatively easy toimplement, by corporate customers.
Operating income for the year under review increased 4.1% year over year to ¥926 million. The cost of goods
sold increased ¥83 million, or 27.7% year over year, to ¥384 million, and selling, general and administrative
expenses increased ¥82 million, or 9.4%, to ¥968 million. However, operating income for the year increased ¥36
million year over year due to the increase in revenue. The increase in the cost of goods sold was primarily
attributable to the increases in both labor expenses and other expenses centering on subcontracting costs associatedwith the operation of hall tests, resulting from the increase of orders. The primary factors for the increase in selling,
general and administrative expenses were the increases in labor expenses largely due to the expansion centered onsales personnel and special bonuses, in rent due to increased floor space and in sales promotion-related expenses.
Ordinary income for the year under review increased 5.0% year over year to ¥939 million. Ordinary incomeincreased ¥45 million year over year as non-operating income increased ¥8 million year over year to ¥14 million
and operating income increased, whereas non-operating expenses were mostly unchanged from the previous year.
The primary factors for the increase in non-operating income were a year-over-year increase of ¥6 million in gains
on investments in a limited liability partnership for venture businesses and the recording of ¥1 million as dividend
income.

Income before income taxes for the year under review increased 3.6% year over year to ¥939 million. Income
before income taxes increased ¥32 million year over year, reflecting a year-over-year decrease of ¥14 million in
extraordinary gains and a year-over-year decrease of ¥1 million in extraordinary losses, in addition to the increasein ordinary income. The decrease in extraordinary gains was primarily due to the recording of ¥12 million in thegain on sales of investment securities for the same period a year earlier. The decrease in extraordinary losses wasdue to the recording of ¥1 million in loss on valuation of inventories for the same period a year earlier.
Net income for the year under review increased ¥33 million, or 5.9% year over year, to ¥588 million, mainly due
to the increase in income before income taxes and the reduction in the corporate tax rate.
* The industry has self-imposed controls regarding the employment of new graduates, under which industry groups agreed not tostart employment PR activity and screening process for new graduates prior to a fixed date in light of the academic schedules
for students. The Keidanren (Japan Business Federation) stipulated in its “Guidelines for Recruiting and Employing New
Graduates” that corporations’ PR activity shall commence on and after March 1 (previously, it had been December 1 of theyear prior to graduation or completion), and screening activity on and after August 1 (previously, it had been April 1 of theyear of graduation or completion), respectively, of the year just preceding the year of graduation or post-graduate completionfor new graduates who will enter corporations on and after fiscal 2016.
 (Illustration of new graduates)
Graduating Year
Students scheduled tograduate in 2015

Junior Students
December 1䋻㻼㻾㻌㻭㼏㼠㼕㼢㼕㼠㼥

Students scheduled tograduate in 2016

Senior Students
April 1䋻㻿㼏㼞㼑㼑㼚㼕㼚㼓㻌㻭㼏㼠㼕㼢㼕㼠㼥March 1䋻㻼㻾㻌㻭㼏㼠㼕㼢㼕㼠㼥August 1䋻㻿㼏㼞㼑㼑㼚㼕㼚㼓㻌
Activity(Projected performance for the year ending September 30, 2016)
Despite several concerns such as a slowdown in economic growth in the emerging countries and global politicalinstability, a gradual recovery undertone from the implementation of various economic policies is expected tocontinue and the employment environment is expected to remain firm in the coming year ending September 30,
2016. Meanwhile, although the new industry’s self-imposed controls regarding the employment of new graduates
expected to graduate from universities in 2016 were implemented from the year under review, a review of suchself-imposed controls has been under consideration for new graduates who are expected to graduate fromuniversities in 2017. We therefore intend to continue enhancing our operating performance by speedily providing
optimum services based on our precise analysis and understanding of corporate customers’ needs by taking into
account the possibility of another change in the schedules concerning recruitment-related PR activity and thescreening by corporations of new graduates.
In light of the above, net sales of ¥2,368 million (up 3.9% year over year), operating income of ¥962 million (up3.9%), ordinary income of ¥962 million (up 2.5%) and net income of ¥639 million (up 8.7%) are projected for theyear ending September 30, 2016.

(2) Basic Policy Regarding Profit Distribution and Dividends for the Year Ended September 30, 2015, and theYear Ending September 30, 2016
The Company considers the return of profits to shareholders to be one of its mainstay management tasks.Consequently, the Company intends to maintain a basic policy of ensuring stable and proactive profit distribution toshareholders with a benchmark payout ratio of 50% while maintaining an internal reserve for the future
reinforcement of its business structure. The Company’s dividends from surplus are distributed twice per annum as
an interim dividend and a year-end dividend. The internal decision is made by the Board of Directors for theinterim dividend and by a general meeting of shareholders for the year-end dividend.
In line with the above basic policies, the Company plans to distribute an annual dividend per share of ¥98 for theyear ended September 30, 2015, consisting of ¥52 per share for the year-end dividend and ¥46 per share for theinterim dividend. This is a dividend increase of ¥6 (up 6.5%) annually compared with a ¥92 annual dividend pershare for the previous year.
The Company intends to reinforce its management foundation by allocating the internal reserves to IT-related
investments for ensuring higher safety of its information systems and R&D projects of new assessment tools.
With regards to the dividend for the next year, the Company intends to maintain the same amount of annual
dividend per share of the year under review.