Feb 7, 2017

Non-Consolidated Financial Results (Excerpt) for the First Quarterof Fiscal 2017 [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 submit the Quarterly Securities Report:
Feb 14, 2017
Date to start distributing dividends:
Supplementary documents for this summary of financial statements
NoneResults briefing for financial results:
NoneThe original disclosure in Japanese was released on Jan 27, 2017 at 15:15 (GMT+9)
1. Non-Consolidated Financial Results for the First Quarter of Fiscal 2017 (October 1, 2016 to Dec 31, 2017)(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 ofFirst three monthsof Fiscal 2017
First three monthsof Fiscal 2016

Operating income
Millions of%Millions ofYen

Net income%278‫ڹ‬0.7‫ڹ‬12ʊ

‫ڹ‬12ʊ

‫ڹ‬5ʊ

280

7.7

‫ڹ‬6ʊ

‫ڹ‬6ʊ

‫ڹ‬4ʊ%

Millions ofYen%

Fully diluted
net income per share

Net income per shareFirst three monthsof Fiscal 2017
First three monthsof Fiscal 2016

Yen

Ordinary income

YenYenYen‫ڹ‬1.93ʊ

‫ڹ‬1.44ʊ(2) Non-Consolidated Financial Position
Total assets

Net assets

Millions ofDec 31, 2016
Sep 30, 2016
(Reference) Equity capital:

Yen

Equity ratio

Millions ofYen%

3,938
3,590
4,398
3,789
Dec 31, 2016: ¥3,586 million Sep 30, 2016: ¥3,785 million

91.1
86.1

2. Dividends
End ofFirst quarter

Fiscal 2016
Fiscal 2017
Fiscal 2017 (forecast)

Dividend per share
End ofThird quarterEnd ofSecond quarter

Year-End

AnnualYen

YenYenYenYenʊʊ

49.00

ʊ61.00110.0055.00

ʊ55.00110.00(Note) Revisions to recent dividends forecast: None
3. Non-Consolidated Forecast for the Year Ending September 30, 2017 (October 1, 2016 to September 30, 2017)
Net sales
Millions ofFiscal 2017

Operating income

Yen%

2,520

4.1

Millions of

Ordinary income

Yen%

1,034

1.6

Millions of

Net income
per share

Net income

Yen%

1,032

1.1

Millions ofYen%

701

5.2

Yen

230.62(Note) Revisions to recent business forecast: NoneNet income per share has been adjusted based on the average number of shares outstanding (3,043,439 shares) for the year ending
September 30, 2017, which was computed taking into account the number of shares issued during the first quarter of the year ending
September 30, 2017, to address the exercise of subscription rights to shares as a stock option.

-1-(1) Application of particular accounts procedures to the preparation of quarterly non-consolidated financial statements:Yes(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 Dec 31, 2016

3,043,979

As of Sep 30, 2016

3,040,979(ii) Number of treasury shares

As of Dec 31, 201633

As of Sep 30, 2016

33(iii)Average Number of shares outstanding

First three monthsof Fiscal 2017

3,041,935

First three monthsof Fiscal 2016

3,024,708* Implementation status of quarterly review proceduresThis financial results summary is not subject to quarterly review procedures under the Financial Instruments and Exchange Act, and thequarterly financial 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 forecastss
1.

2.

The forward-looking statements regarding financial results forecasts, etc., appearing in this financial results summary have been preparedbased on information currently available to the Company and certain assumptions that the Company believes to be reasonable. TheCompany makes no guarantee as to their realization. Actual financial results may differ substantially from the forecasts due to variousfactors.
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 business forecasts for the first half.

-2-Qualitative information regarding the quarterly settlement of accounts(1) Explanation of operating results
During the first three months of the year ending September 30, 2017 (October 1, 2016, through December 31,2016), net sales of SHL-JAPAN Ltd. (the “Company”) decreased ¥1 million, or 0.7%, year over year to ¥278
million. By business segment, “Product sales” increased 1.2% to ¥156 million, “Consultancy sales” decreased 7.1%
to ¥112 million and “Training sales” increased 89.4% to ¥10 million.
The decrease in net sales was primarily attributable to the fact that many customers’ recruiting and screening
schedules for students who are expected to graduate in fiscal 2017 were completed earlier on a year-over-year basis,
as a result of the self-imposed regulations regarding the employment of new graduates* that were changed in theprevious fiscal year. This led to lower demand for marking and other score processing operations in bubble sheet
test services during the three-month period under review, compared to the same period of the previous fiscal year.
Operating loss for the three-month period under review totaled ¥12 million (compared with operating loss of ¥6
million for the same period of the previous fiscal year). While the cost of goods sold decreased ¥1 million, or 2.5%,year over year to ¥58 million, an operating loss was incurred mainly because selling, general and administrative
expenses increased ¥5 million, or 2.3%, year over year to ¥233 million, in addition to the decrease in net sales. The
primary factors for the increase in selling, general and administrative expenses were the increases in labor expenses,
as well as taxes and dues.
Ordinary loss for the three-month period under review totaled ¥12 million (compared with ordinary loss of ¥6million for the same period of the previous fiscal year). This figure was almost equal to operating loss because both
non-operating income and non-operating expenses were small as in the same period of the previous fiscal year.
Loss before income taxes for the three-month period under review totaled ¥8 million (compared with loss before
income taxes of ¥6 million for the same period of the previous fiscal year). This was primarily due to the reportingof ¥3 million of gain on sales of investment securities as extraordinary gains.
After taking into account the above factors and income taxes—current and income taxes—deferred, net loss forthe three-month period under review totaled ¥5 million (compared with net loss of ¥4 million for the same period of
the previous fiscal year).
* The industry has self-imposed controls regarding the employment of new graduates, under which industry
groups agreed not to start employment PR activity and the 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 for new
graduates who will enter corporations in fiscal 2017 onwards shall commence on and after March 1 of the year
just preceding the year of graduation or post-graduate completion, and screening activity on and after June 1of the year of graduation or completion (it had been August 1 of the year of graduation or completion for new
graduates who will enter corporations in fiscal 2016).
(2) Explanation about future prospects such as business forecastsIn the year under review, the Company believes that corporations remain firmly motivated to hire more
employees as in the previous fiscal year and the screening market environment for new graduates continues to growsteadily.
-3-

We intend to continue enhancing our operating performance by speedily providing optimum services based on
our precise analysis and understanding of corporate customers’ needs.
In light of the above and based on our analysis of the business results, financial position and other managerial
administrative material for the three-month period under review, followed by our careful consideration of business
forecasts, the Company is not, at this time, revising its business forecast for the year ending September 30, 2017,
which was released on October 28, 2016.

-4-