Consolidated Financial Results for the Fiscal Year Ended March 31, 2024
ARE Holdings, Inc. (former company name: Asahi Holdings, Inc.) [IFRS]
April 25, 2024

Stock code:

5857

Shares listed:Tokyo Stock Exchange - Prime Market

URL:
Representative:

https://www.asahiholdings.com/english
Tomoya Higashiura, Representative Director, President & CEO

For further information please contact:

Yoko Yanagida, Head of Corporate Communications

The Ordinary General Meeting of Shareholders:(Phone) +81–3–6270–1833
June 18, 2024

Filing date of financial statements:
Start of dividend payment:

June 19, 2024
June 4, 2024

Supplementary materials for the financial results:

Yes

Investor conference for the financial results:

Yes (for institutional investors, analysts)(Rounded down to the nearest million yen)

1. Results of the fiscal year ended March 31, 2024 (From April 1, 2023 to March 31, 2024)(1) Results of operations(Percentage: Changes relative to corresponding previous period)
OperatingprofitRevenue
The fiscal year ended
March 31, 2024
March 31, 2023

Millions of yen%

Millions of yen

322,253 17.5 12,367
274,209– 16,282
Basic earnings per
share

Profit before
tax%

Millions of yen(24.0) 12,426– 12,649

Diluted earnings
per share

ProfitTotal
attributable to comprehensive
owners of parent
incomeProfit% Millions of yen%

Millions of yen%

Millions of yen%(1.8) 24,490 124.1 24,490 124.1 26,275 105.9– 10,929 (41.7) 10,929 (41.7) 12,761 (15.9)
Profit to equity
attributable toowners of parent

Profit before
tax to total
assetsOperatingprofit to revenue

The fiscal year ended
Yen
Yen
%
%
%
March 31, 2024
319.54287.01
21.0
4.1
3.8
March 31, 2023
141.19128.72
10.3
4.3
5.9(Reference) Share of profit (loss) of investments accounted for using equity method:
Fiscal year ended March 31, 2024
– million yen;
Fiscal year ended March 31, 2023
(616) million yen(Note)The Company reclassified the business of Japan Waste Corporation, which was a consolidated subsidiary of
the Company, under discontinued operations. Accordingly, revenue, operating profit and profit before tax forthe fiscal year ended March 31, 2023, are presented as amounts for the continuing operations excluding thediscontinued operations.
(2) Financial Position

As ofMarch 31, 2024
March 31, 2023

Total assets

Total equity

Equity attributableto owners of parent

Equity attributableto owners of parent
ratio

Equity per share
attributable toowners of parent

Millions of yen
317,998
287,448

Millions of yen
126,476
106,957

Millions of yen
126,476
106,957

%
39.8
37.2

Yen
1,650.20
1,395.52(3) Cash flows

The fiscal year ended
March 31, 2024
March 31, 2023

Cash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities

Millions of yen
12,62136,754

Millions of yen(28,707)(3,935)

Millions of yen
7,050(23,818)

Cash and cash
equivalents at end of
the fiscal year
Millions of yen
6,881
17,952

2. Dividend payments
Dividends per shareFirst
quarter

Secondquarter

Third
quarterYear-end

Annual

Yen

Yen

Yen

Yen

Yen

Total
dividend
payment(annual)Payoutratio(consolidated)

Millions of yen

Dividend
to equity
attributableto owners ofparent(consolidated)%%Year ended March 31, 2023
–
45.00
–
45.00
90.00
6,987
63.7
6.6
Year ended March 31, 2024
–
45.00
–
45.00
90.00
7,011
28.2
5.9
Year ending March 31, 2025
–
40.00
–
40.00
80.00
46.4
(Forecast)(Note)The year-end dividend for the fiscal year ended March 31, 2024 will be finalized at a meeting of the Boardof Directors to be held in May.
3. Forecast (From April 1, 2024 to March 31, 2025)
Revenue
Millions of yen

Six months ending
180,000
September 30, 2024
Year ending March 31, 2025 370,000(Percentage: Changes relative to corresponding previous period)
ProfitOperating
Profit before
Basic earnings
attributable toprofittax
per shareowners of parent% Millions of yen

24.8

8,500

14.8 18,000% Millions of yen

49.1% Millions of yen

%

Yen

8,300

40.7

6,304

19.9

82.66

45.5 17,600

41.6

13,148(46.3)

172.53

* Notes(1)

Changes in significant subsidiaries during the current fiscal year: Yes
Newly included:
Excluded:

(2)

None
1 company: Japan Waste Corporation

Changes in accounting policies and accounting estimates(i) Changes in accounting policies required by IFRS: No(ii) Changes other than (i) above: No(iii) Changes in accounting estimates: No(3)

Number of issued shares (common stock)(i) Number of issued shares at the end of year (including treasury stock)
As of March 31, 2024

79,708,688 shares

As of March 31, 2023

79,708,688 shares(ii) Number of treasury stock at the end of year
As of March 31, 2024

3,065,554 shares

As of March 31, 2023

3,065,458 shares(iii) Averaged number of shares during the period
Year ended March 31, 2024

76,643,154 sharesYear ended March 31, 2023

77,410,371 shares

(Reference) Summary of Nonconsolidated Results
1. Nonconsolidated results of the fiscal year ended March 31, 2024 (From April 1, 2023 to March 31, 2024)(1) Results of operations(Percentage: Changes relative to corresponding previous period)
Net sales

The fiscal year ended
March 31, 2024
March 31, 2023

The fiscal year ended
March 31, 2024
March 31, 2023

Millions of yen

10,4886,181

Operating profit%

Millions of yen

69.7(61.9)

8,303
5,285

Ordinary profit% Millions of yen

57.1(64.0)

8,934
5,649

Profit% Millions of yen

58.2(62.3)

Earnings per share

Diluted earnings per share

Yen
121.55
64.45

Yen
–
–

9,315
4,988

%

86.7
(66.7)(2) Financial Position

As ofMarch 31, 2024
March 31, 2023
(Reference)
Shareholders’ equity

Total assets

Net assets

Millions of yen

Millions of yen

110,724
105,82778,45976,143As of March 31, 2024: 77,312 million yen

Shareholders’ equity ratio
%

69.8
70.9

Net assets per shareYen

1,008.73
978.52As of March 31, 2023: 74,996 million yen* This report is not subject to audit procedures* Statement regarding the proper use of financial forecasts and other special remarks(Notes on forward looking statements, etc.)
These forecast performance figures are based on the information currently available to the Company’s
management and certain assumptions judged rational. Accordingly, there might be cases in which actual resultsmaterially differ from forecasts of this report. Please refer to page 2 “1. Overview of Consolidated Operating
Results (1) Consolidated Business Performance for the Year ended March 31, 2024” for the assumptions used andother notes.

【Appendix】

Table of contents of the appendix

1. Overview of Consolidated Operating Results ................................................................................................................ 2(1) Consolidated Business Performance for the Year ended March 31, 2024 ................................................................ 2(2) Consolidated Financial Position and Cash Flows for the Year ended March 31, 2024 ........................................... 2(3) Dividends .................................................................................................................................................................... 3(4) Business and Other Risks .......................................................................................................................................... 3
2. Our Group ........................................................................................................................................................................ 7
3. Basic Concept Regarding Selection of Accounting Standards....................................................................................... 9
4. Consolidated Financial Statements ............................................................................................................................. 10(1) Consolidated Statements of Financial Position ...................................................................................................... 10(2) Consolidated Statements of Income ........................................................................................................................ 12(3) Consolidated Statements of Comprehensive Income .............................................................................................. 13(4) Consolidated Statements of Changes in Equity ...................................................................................................... 14(5) Consolidated Statements of Cash Flows ................................................................................................................. 16(6) Notes on Assumptions for Going Concern ............................................................................................................... 17(7) Notes on Consolidated Financial Statements ......................................................................................................... 17
1. Reporting entity ..................................................................................................................................................... 17
2. Basis of preparation ............................................................................................................................................... 17
3. Material accounting policies .................................................................................................................................. 17
4. Significant accounting estimates and associated judgements ............................................................................. 17
5. Segment information ............................................................................................................................................. 17
6. Impairment loss ..................................................................................................................................................... 20
7. Discontinued operations ........................................................................................................................................ 21
8. Per share information ............................................................................................................................................ 22
9. Subsequent events ................................................................................................................................................. 22
5. Others ............................................................................................................................................................................ 23(1) Amounts of sales ....................................................................................................................................................... 23- 1 -1. Overview of Consolidated Operating Results(1) Consolidated Business Performance for the Year ended March 31, 2024
① Operating results
During the fiscal year under review, while the Japanese economy continued to expand moderately, theeconomic recovery came to a standstill in the latter half of the year due to the effects of rapid price increases
and serious natural disasters, and there are concerns that global monetary tightening and the troubling future
outlook for the Chinese economy will further depress the Japanese and overseas economies. Under these
conditions, the Group’s results in each business segment were as follows.
Precious Metals businessIn the precious metals business, revenue increased year on year mainly due to higher gold sales volume andsales price than the previous fiscal year, and growth in precious metals refining business in North America. On
the other hand, operating profit decreased year on year due to a delayed recovery in the precious metal recycling
business in the electronics and catalyst-related fields, in addition to a year-on-year drop in the prices of
palladium and rhodium. In addition, an impairment loss for non-current assets associated with the closure of
the business office in Saijo-shi, Ehime Prefecture was recorded because the Company has decided to consolidate
the related processes to its newest plant under construction in Bando-shi, Ibaraki Prefecture, in order tostrengthen its competitiveness in the electronics and catalyst-related fields over the medium to long term.
Environmental Preservation businessIn the environmental preservation business, during the fiscal year under review, a share exchange wasconducted between Japan Waste Corporation, which was a consolidated subsidiary of the Company, andRenatus Co., Ltd., whereby Renatus became the wholly owning parent company, and Japan Waste became thewholly owned subsidiary company, resulting in the Japan Waste business being classified as discontinued
operations for the fiscal year under review and the previous fiscal year. The volume of industrial waste handled
and the utilization rates at treatment facilities for the fiscal year under review were stable.
In addition, the results of evaluating the fair value of Renatus shares in connection with the share exchange
were recorded in “Profit from discontinued operations.”
As a result of the above, revenue during the fiscal year was 322,253 million yen, a year-on-year increase of
48,044 million yen (+17.5 percent). Operating profit was 12,367 million yen, a year-on-year decrease of 3,914
million yen (-24.0 percent). Profit before tax was 12,426 million yen, a year-on-year decrease of 222 million yen(-1.8 percent). Profit was 24,490 million yen, a year-on-year increase of 13,560 million yen (+124.1 percent).
Profit attributable to owners of parent was therefore 24,490 million yen, a year-on-year increase of 13,560
million yen (+124.1 percent). By segment, revenue in the Precious Metals business was 322,218 million yen, a
year-on-year increase of 48,012 million yen (+17.5 percent).
② Outlook
The Group will continue to strive to expand earnings and increase corporate value.
Business forecast for the next period is as follows: 370,000 million yen in revenue, 18,000 million yen in
operating profit, 17,600 million yen in profit before tax and 13,148 million yen in profit attributable to ownersof parent.

(2) Consolidated Financial Position and Cash Flows for the Year ended March 31, 2024
As of March 31, 2024, total assets amounted to 317,998 million yen, up 30,549 million yen from the previous
fiscal year end. This was mainly due to increases of 15,231 million yen in other (current) financial assets and(non-current) financial assets, 19,336 million yen in other current assets and 27,665 million yen in investments
accounted for using equity method, while cash and cash equivalents decreased by 11,070 million yen andproperty, plant and equipment decreased by 9,361 million yen.
Total liabilities amounted to 191,522 million yen, up 11,030 million yen from the previous fiscal year end.
This was due mainly to increases of 3,818 million yen in other financial liabilities, 2,177 million yen in income- 2 -tax payable, 3,147 million yen in other current liabilities and 4,156 million yen in deferred tax liabilities, whilebonds and loans payable decreased by 3,202 million yen.
Total equity amounted to 126,476 million yen, up 19,518 million yen from the previous fiscal year end. Thiswas due mainly to an increase of 26,275 million yen in comprehensive income and a decrease of 6,897 million
yen used for dividends.
Net cash provided by operating activities amounted to 12,621 million yen after adding depreciation andamortization of 3,632 million yen to profit before tax of 12,426 million yen, as well as factoring in share exchange
gains, the decrease in inventories, the decrease in trade and other receivables, the decrease in trade, loans andother payables, income taxes paid, and income taxes refunded.
Net cash used in investing activities amounted to 28,707 million yen due mainly to 7,585 million yen ofpurchase of property, plant and equipment and 19,616 million yen of payments for loans receivable and 7,550
million yen of outflow due to loss of control of subsidiaries by share exchange, despite 2,851 million yen ofproceeds from withdrawal of time deposits.
Net cash provided by financial activities amounted to 7,050 million yen due mainly to 14,281 million yen ofproceeds from long-term loans payable, despite 6,897 million yen of cash dividends paid.
As a result, cash and cash equivalents as of March 31, 2024 decreased 11,070 million yen from March 31,
2023, to 6,881 million yen.

(3) Dividends
The Group strives to maintain a stable dividend payout ratio of 40%, while enhancing internal reserves
necessary for capital investment and M&A activities for growth strategies.
Based on the above basic policy, the year-end dividend for the current fiscal year is planned to be 45 yen per
share, and the annual dividend for the current fiscal year combined with the interim dividend is planned to be
90 yen per share. For the next term, we plan to pay an interim dividend of 40 yen and a year-end dividend of
40 yen (annual dividend of 80 yen).

(4) Business and Other Risks
Major risks that could affect the Group’s operating results and financial condition include the following. We
believe these matters could have a significant impact on investor decisions, but the categories below are limited
to those that the Group is currently aware of; and not necessarily all risks are covered here.
① Precious metals prices and currency exchange rates
Precious metals and rare metals, which are the main products of the Group’s Precious Metals business, aretraded on international markets, and their prices fluctuate due to various factors worldwide, includinginternational or regional supply and demand, political, economic and social trends, exchange rates andmonetary policies, among others. Therefore, the Group basically hedges precious metal prices through forward
transactions, etc. However, since rhodium is illiquid and hedging instruments are limited, the Group works tomitigate risk while also utilizing other methods. In addition, the Group provides timely reports on the status ofprice fluctuations, etc. for the main precious metals to management. The size of fluctuation in precious metals
prices and currency exchange rates, the conditions of forward transactions and other factors could affect theGroup’s operating results and financial condition.
② Laws and regulations
In the countries and regions where the Group operates business, various laws and regulations apply regarding
matters such as permission to do business, rules for import/export/transport, commercial transactions, labor,
taxation, intellectual property rights, and environmental preservation. Taking the stance that compliance isimportant, the Group has built a system for centrally managing information about revisions to laws related to
all its business fields and ensuring that this knowledge is communicated without fail to the front lines, andcarefully follows laws, regulations, and social rules. However, in the unlikely event that a situation arises wherelaws, regulations, and social rules could not be followed, or if they change such that business is restricted, it
could affect the Group’s operating results and financial condition.

- 3 -③ Economic fluctuation
Manufacturing industries, which are among the transacting industries for the Group’s two businesssegments: the Precious Metals business and the Environmental Preservation business, are affected by economic
conditions not only in Japan but also in various other countries and regions. When demand from such industries
declines due to recession and so on, it could affect the Group’s operating results and financial condition.
Moreover, in the precious metals recycling business, the Group recycles precious metals contained in end
products such as electronics-related equipment and automobiles, and is therefore affected by consumption
trends. A decrease in personal consumption caused by a decline in the general level of consumption could
therefore affect the Group’s operating results and financial condition.
④ Business environment
The Group’s two business segments, the Precious Metals business and the Environmental Preservation
business, face the possibility of major changes in customer needs due to changes in laws, regulations, andpermits that concern a sector or faster-than-expected shifts overseas by corporate customers. Furthermore,industry reorganization and other major changes in the business environment are possible. In addition,
management is taking on challenges in new businesses and fields. When implementing a new business,management conducts thorough discussions at executive committee meetings, etc. and puts in place risk
management systems as necessary, but risks may materialize if the business environment differs fromexpectations. The results could affect the Group’s operating results and financial condition.
⑤ Intensified competition
The Group’s two business segments, the Precious Metals business and the Environmental Preservation
business, face competition from various companies. The Group continues to make efforts to secure competitive
advantages by accurately meeting customer needs through sales efforts and initiatives on technology, products,
and cost responsiveness. Intensified competition from competitor companies, however, can force the Group’s
products and services into harsh price competition. The results could affect the Group’s operating results andfinancial condition.
⑥ Overseas business deployment
One of the Group’s growth strategies is expansion of its overseas business. In this regard, the Group carriesout business in countries and regions in North America, Asia, etc. Political or economic phenomena unfavorable
to business, labor disputes due to differences in labor environment, uncertainty in finding suitable local
personnel, conflicts, terrorism, and other social disturbances, and unfair intervention by authorities due tounderdeveloped business infrastructure in a country or region are inherent risks. In the precious metals refining
business in North America, we are also using the refining business as a base from which to expand value-added
services, including trading and finance. In addition, the Group has started precious metal storage business as
a new business venture. As well as fully analyzing the risks associated with businesses, we have put in place arobust control structure, such as by involving the Risk Management Department and discussing issues on the
Board of Directors, but these risks could crystallize in the event of a deterioration in the economic environment
or in the credit status of our counterparties. If such situations occur, it could affect the Group’s operating results
and financial condition.
⑦ Corporate acquisition
The Group has worked to expand its lines of business and business scale through corporate acquisition and
expects to take a forward-looking approach projects that will contribute to further growth in the future. In orderto maximize the integration effect with target businesses and companies, the Group will attempt to integrate
and unify them with its business strategy and operations. However, if the integration of human resources andassets does not proceed as planned, it is possible that the expected integration and unification effects will not
be realized. The results could affect the Group’s operating results and financial condition.
⑧ Impairment of goodwill and fixed assets
When the Group acquired a company, it records goodwill arising from the acquisition, as well as various
property, plant and equipment and intangible assets for business use. At the time of the acquisition, the Group
carries out sufficient surveys from the financial, legal, human resource, and facility perspectives, among others,- 4 -but if the acquired company and business do not achieve business results as initially expected due to changes
in the market environment, etc., and the operating results and profitability deteriorate markedly, these assets
may become impaired. If such situations occur, it could affect the Group’s operating results and financial
condition.
⑨ Natural disasters and infectious diseases
Natural disasters such as large earthquakes or typhoons or the outbreak of new infectious diseases could
cause serious damage to the Group’s production, distribution, sales, and information management facilities.
The Group has implemented countermeasures such as business continuity management (BCM), flood
countermeasures, disaster readiness drills, and building an employee safety confirmation system. However,these are not able to completely eliminate damage due to natural disasters or unknown infectious diseases, etc.
Therefore, if these should occur it could affect the Group’s operating results and financial condition.
Also, while the restrictions related to the COVID-19 pandemic were lifted, if similar situation occurs, it could
have a negative impact on the domestic and overseas economies and markets, which in turn could affect theGroup’s operating results and financial condition.
⑩ Health and safety
The Group works to strengthen its safety management system, and regularly carries out disaster/accident
prevention activities such as holding Safety Promotion Meetings that are also attended by management andtaking necessary measures in order to eliminate occupational and facilities accidents. However, there is no
guarantee that they can be completely prevented or mitigated. Therefore, if a serious occupational or facilities
accident should occur, it could affect the Group’s operating results and financial condition.
⑪ Human resources
The Group believes that its medium- to long-term growth will be achieved by maximizing the productivity ofthe entire organization through having employees take pride in their work and actively take on the challenge
of innovation based on trust and bonding. To this end, efforts are focusing on promoting diversity equity andinclusion as well as health management, which enable diverse employees to achieve harmony in their work andoverall lives in their own way. Specifically, the Group is promoting the employment of people with disabilities,
promoting the empowerment of women, work style reforms such as a three-day work week model, andimplementing recruitment activities and various human resource development programs to acquire core humanresources over the medium to long term. However, if the Group is unable to secure high quality human resources
and prepare the necessary talent for taking on challenges at the right time due to increased speed of businessdevelopment, it could affect the Group’s operating results and financial condition.
⑫ Research and development
The Group conducts independent research and development and analysis technology development aimed at
effectively carrying out “precious metals recycling” and “detoxifying and recycling of industrial waste.” However,research and development of new technologies is affected by various factors, such as changes in the market
environment, competition, and the ability to commercialize development results. Therefore, it is highly
uncertain whether the expenses used in research and development can be recovered. For this reason, if theresults of research and development are not obtained as initially anticipated, it could affect the Group’s
operating results and financial condition.
⑬ Key intellectual property rights
In order to protect intellectual property rights important to business deployment, the Group carries out
appropriate management. However, unforeseen leaks to outside parties can occur, and complete protection of
intellectual property rights may be impossible in certain regions. Therefore, it may not be possible to effectively
prevent third parties from using the Group’s intellectual property rights to manufacture and sell similar
products and services. Moreover, the Group could be embroiled in a dispute if the products and technologies
that it is developing for the future infringe unintentionally on the intellectual property rights of anothercompany, or regarding the handling of workplace inventions in its relationships with employees. The results
could affect the Group’s operating results and financial condition.

- 5 -⑭ Product quality assurance and product liability
Led by its Quality Assurance Division, the Group has acquired ISO9001 to provide products offering
customers greater confidence and satisfaction, and makes continuous improvements to its quality management
systems and strives to maintain and improve quality. Through such measures, the Group makes every effort
with its product quality assurance system, but if a product produced by the Group causes damages, it could
affect the Group’s operating results and financial condition.
⑮ Environmental protection
Based on its Environmental Policies, the Group carries out various initiatives to protect the global
environment. For example, it has established the Company-wide Environmental Goals (Annual Plan) and an
Environmental Committee is set up at every business site. Through these and other efforts, the Group complies
with environmental laws and regulations, revises its plans, deliberates about environmental education and soforth, and reports to management. However, there is no guarantee that all pollution and other environmental
risk can be completely prevented or mitigated, so if the Group should cause serious pollution of the environment,
it could affect the Group’s operating results and financial condition.
⑯ Climate change
The adoption of the Paris Agreement at the 21st Session of the Conference of the Parties to the United Nations
Framework Convention on Climate Change (COP 21), which has been ratified by every country, has sparked aglobal wave of initiatives aimed at reducing greenhouse gases deemed to cause climate change and global
warming. The Group has made climate change initiatives one of its business material issues, and has set atarget for 2030 of reducing CO2 emissions derived from energy by 50% from the 2015 level, and is making efforts
toward reduction. In addition to declaring the Group’s goal to be carbon neutral by 2050, the Group has
measured its CO2 emissions (Scope 1, 2, and 3) and received third-party verification results. Additionally, weendorsed the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD), and havecarried out actions in line with their recommendations. As a result, the Group’s operating results and financial
condition could be affected from future climate change impacts if a carbon pricing system that includes a carbon
tax were introduced (a transition risk), or if natural disasters were to become so severe due to extreme weather
conditions that the Group’s facilities and other assets were severely affected and business activities weresuspended for a long period of time (a physical risk).
⑰ Information security
PCs and tablets used by the Group use the latest security countermeasures, and we take sufficient measures
to ensure that system faults and information theft or loss do not occur during their installation and operation.
We also implement regular employee training to enhance their IT literacy. However, there is a possibility that
unexpected events could occur such as destruction or tampering of important data or external leaks of
information as a result of infection by a computer virus, hacking damage, and system faults due to software
defects, or a larger than anticipated external attack. Such an event could affect the Group’s operating results
and financial condition.
⑱ Lawsuits and other legal procedures
As the Group carries out business in Japan and overseas, it could be subjected to lawsuits and other legal
procedures. The Group appropriately monitors major lawsuits that have already been instigated or have thepotential to be instigated, and takes countermeasures as needed. However, if the Group becomes a party to suchaction, it might have to pay large damages, etc. The results could affect the Group’s operating results andfinancial condition.

- 6 -2. Our Group
Our Group comprises of the holdings company “ARE Holdings, Inc.,” “Asahi Pretec Corp.,” “ASAHI METALFINE,
Inc.,” eight other consolidated subsidiaries, and an equity method affiliate. Our main businesses are Precious
Metals business and Environmental Preservation business. The details are as follows:(1) Precious Metals businessIn the Precious Metals business, we sell precious/rare metal products such as gold, silver, palladium, platinum,and rhodium by recycling scrap containing precious metals, etc.
In Japan, Asahi Pretec Corp. and ASAHI METALFINE, Inc. collect scraps containing precious/rare metals
from the electronics, dentistry, jewelry manufacturing and distribution, and automotive catalyst sectors. At
factories around the country, it collects, separates and refines the scrap and sells high-purity metals to trading
companies, jewelry makers, semiconductor/electronic component makers, etc. It also engages in precision
cleaning and precious metal delamination of manufacturing equipment parts from semiconductor/electronic
component makers, etc.
Overseas, ASAHI G&S SDN. BHD. in the Malaysia/Singapore region and Asahi Pretec Korea Co., Ltd. inSouth Korea are engaged in the precious metals recycling business. Additionally, Asahi Refining USA Inc. andAsahi Refining Florida LLC in the United States, and Asahi Refining Canada Ltd. in Canada carry out therefining and processing of gold, silver, and other precious metals. Also, Asahi Depository LLC is engaged in the
precious metal storage business in the United States.

(2) Environmental Preservation business
The main line of our Environmental Preservation business is the collection, transport, and intermediate
treatment of industrial waste.
Waste System Japan Corporation was established as a holding company for the Environmental Preservation
business.

- 7 -[Group Business Organization Chart]
The aforementioned items are shown in the following group business organization chart.

Domestic Bases

North America

ASAHI METALFINE, Inc.

Asahi Refining
USA Inc.

ARE Holdings, Inc.

Precious Metals BusinessSelling recycling scrap containing
precious / rare metals

Asahi Refining
Florida LLC

Asahi Pretec Corp.

Selling recycling scrap containing
precious / rare metals

Asahi Refining
Canada Ltd.

Asia

ASAHI G&S SDN.BHD.
Asahi Depository LLC
Asahi Pretec
Korea Co., Ltd.

Enviro nm e ntal
P re se rvatio n
Busine ss

Domestic Bases

Waste System Japan Corporation

Other

Other 1 company(Note) Unmarked : Consolidated subsidiary* : Equity method affiliate- 8 -*Renatus Co., Ltd3. Basic Concept Regarding Selection of Accounting Standards
We have applied International Financial Reporting Standards (IFRS) from the first quarter of fiscal year ended
March 31, 2017, with the objectives of enhancing our management base for global business development andenabling easier international comparison of financial information in capital markets.

- 9 -4. Consolidated Financial Statements(1) Consolidated Statements of Financial Position
As ofMarch 31,
2023

As of
March 31,2024

Millions of yen

Millions of yen

ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables

17,952
154,046

6,881
155,268

Inventories
Income tax receivables

40,854
1,345

33,87977

Other financial assets

3,609

17,763

Other current assets

20,56739,903

Total current assets

238,374

253,773

Property, plant and equipment
Goodwill

42,553
1,003

33,19219

Intangible assets
Investments accounted for using equity method

1,255
–

1,580
27,665

Deferred tax assets
Net defined benefit asset
Financial assets
Other non-current assets

3,498
263
429
69

5
186
1,506
68

Total non-current assets

49,07364,224287,448

317,998

Non-current assets

Total assets- 10 -

As ofMarch 31,
2023

As of
March 31,2024

Millions of yen

Millions of yen

LIABILITIES and EQUITY
Liabilities
Current liabilities
Trade and other payables
Loans payable
Income tax payable
Other financial liabilities
Provisions

26,02491,494

27,18064,985

210

2,387

3,740
1,462

6,465
1,302

Other current liabilities

2,547

5,694

Total current liabilities
Non-current liabilities

125,480

108,015

Bonds and loans payable

52,86876,175

Deferred tax liabilities
Net defined benefit liability

275
107

4,432
99

Other financial liabilities
Other non-current liabilities

1,704
53

2,798
–

Total non-current liabilities

55,01083,506

180,491

191,522

7,790

7,790

Capital surplus
Treasury stock
Retained earnings

12,103(5,925)96,31912,245(5,925)
113,837

Other components of equity(3,330)(1,471)

Total equity attributable to owners of parent

106,957

126,476

Total equity

106,957

126,476

287,448

317,998

Total liabilities
EquityCapital stock

Total liabilities and equity- 11 -

(2) Consolidated Statements of Income
The fiscal year ended
March 31, 2023

The fiscal year ended
March 31, 2024

Millions of yen

Millions of yen

Continuing operations
Revenue
Cost of sales
Gross profit
Selling, general and administrative expenses
Other operating income

274,209(249,887)

322,253(300,895)

24,321(6,866)

21,358(8,165)

92

107

(648)

(933)

(616)

–

Operating profit
Finance income

16,282466

12,367
1,136

Finance costs
Other non-operating expenses(795)(3,304)(1,077)–

Profit before tax

12,64912,426

Income tax expenses(4,111)(3,914)

Profit from continuing operations

8,537

8,512

Other operating expenses
Share of profit (loss) of investments accounted forusing equity method

Discontinued operations
Profit from discontinued operations

2,392

15,977

10,92924,490Owners of parent
Non-controlling interests

10,929–24,490–

Profit10,92924,490Continuing operations
Discontinued operations

110.2930.91

111.06208.47

Total (Yen)141.19319.54101.2127.51

101.94185.07128.72287.01

ProfitProfit attributable to:Earnings per share
Basic earnings per share (Yen)

Diluted earnings per share (Yen)Continuing operations
Discontinued operations
Total (Yen)- 12 -

(3) Consolidated Statements of Comprehensive Income

Profit

The fiscal year ended
March 31, 2023

The fiscal year ended
March 31, 2024

Millions of yen

Millions of yen

10,92924,490

(0)

–

23

(73)

(0)

–

23

(73)

Cash flow hedges
Translation adjustments of foreign operations

1,304
503

(1,370)3,228

Total items that may be reclassified to profit or
loss

1,808

1,858

Other comprehensive income
Items that will not be reclassified to profit or loss
Financial assets measured at fair value
through other comprehensive income
Remeasurements of defined benefit plans
Share of other comprehensive income ofinvestments accounted for using equity method
Total items that will not be reclassified to profit
or loss
Items that may be reclassified to profit or loss

1,831

1,784

Comprehensive income

Other comprehensive income, net of tax

12,761

26,275Comprehensive income attributable to:
Owners of parent

12,761

26,275––

12,761

26,275

Non-controlling interests
Comprehensive income- 13 -

(4) Consolidated Statements of Changes in Equity(Millions of yen)
Equity attributable to owners of parent
Other components ofequityCapitalTreasury
Retained
Translation
surplusstockearnings
adjustments
Cash flowof foreign
hedgesCapitalstock

operations

Balance at April 1, 2022
ProfitOther comprehensive
incomeTotal comprehensive
incomePurchase of treasury stock
Dividends
Changes due to loss ofcontrol of subsidiaries
Increase (decrease) due todiscontinued application ofequity method for equitymethod affiliate
Reclassified from othercomponents of equity toretained earnings
Share-based paymenttransactions
Total transactions withownersBalance at March 31, 2023

7,790
–

11,955–(1,819)–92,353
10,929(1,390)–(3,748)
–

–

–

–

–

503

1,304

–

–

–

10,929

503

1,304

–
–

–
–

(4,106)––(6,987)

–
–

–
–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

23

–

–

–

148

–

–

–

–

–

148

(4,106)(6,964)

–

–

7,790

12,103(5,925)96,319(886)(2,443)(Millions of yen)
Equity attributable to owners of parent
Other components of equity
FinancialassetsRemeasuremeasured atments offair value
definedthrough otherbenefit planscomprehensive income

Balance at April 1, 2022
ProfitOther comprehensive
incomeTotal comprehensive
incomePurchase of treasury stock
Dividends
Changes due to loss ofcontrol of subsidiaries
Increase (decrease) due todiscontinued application ofequity method for equitymethod affiliate
Reclassified from othercomponents of equity toretained earnings
Share-based paymenttransactions
Total transactions withownersBalance at March 31, 2023

Total

Total

Total equity

(3)
–

–
–

(5,142)–

105,137
10,929105,137
10,929

(0)

23

1,831

1,831

1,831

(0)

23

1,831

12,761

12,761

–
–

–
–

–
–

(4,106)(6,987)(4,106)(6,987)

0

–

0

0

0

3

–

3

3

3

–

(23)

(23)

–

–

–

–

–

148

148

3

(23)

(19)

(10,941)(10,941)––(3,330)106,957

106,957- 14 -

(Millions of yen)
Equity attributable to owners of parent
Other components ofequityCapitalTreasury
Retained
Translation
surplusstockearnings
adjustments
Cash flowof foreign
hedgesCapitalstock

operations

Balance at April 1, 2023
ProfitOther comprehensive
incomeTotal comprehensive
incomePurchase of treasury stock
Dividends
Reclassified from othercomponents of equity toretained earnings
Share-based paymenttransactions
Total transactions withownersBalance at March 31, 2024

7,790
–

12,103–(5,925)–96,31924,490(886)–(2,443)
–

–

–

–

–

3,228

(1,370)–––24,4903,228(1,370)

–
–

–
–

(0)
–

–
(6,897)

–
–

–
–

–

–

–

(73)

–

–

–

141

–

–

–

–

–

141

(0)

(6,971)

–

–

7,790

12,245(5,925)

113,837

2,341(3,813)(Millions of yen)
Equity attributable to owners of parent
Other components ofequityRemeasurements ofdefinedbenefit plans

Balance at April 1, 2023
ProfitOther comprehensive
incomeTotal comprehensive
incomePurchase of treasury stock
Dividends
Reclassified from othercomponents of equity toretained earnings
Share-based paymenttransactions
Total transactions withownersBalance at March 31, 2024

Total

Total

Total equity––(3,330)–106,957
24,490106,957
24,490

(73)

1,784

1,784

1,784

(73)

1,784

26,27526,275

–
–

–
–

(0)
(6,897)(0)(6,897)

73

73

–

–

–

–

141

141

73

73

(6,756)(6,756)–(1,471)

126,476

126,476- 15 -

(5) Consolidated Statements of Cash FlowsThe fiscal year
ended March 31,
2023

The fiscal year
ended March 31,
2024

Millions of yen

Millions of yen

Profit before tax

12,64912,426

Profit before tax from discontinued operations
Depreciation and amortization

3,403
3,313

23,635
3,632

Impairment loss

1,338

800

Finance income and finance cost
Other non-operating income and expenses

1,624
1,354

2,286
–

616

–

Cash provided by (used in) operating activities

Share of loss (profit) of investments accounted for using equity
methodShare exchange gains
Decrease (increase) in inventories
Decrease (increase) in trade and other receivables
Increase (decrease) in trade, loans and other payables–(20,353)

22,511(1,863)

6,555
13,587(849)(13,607)

Other, net(4,096)(15,015)

SubtotalInterest and dividend income received

40,004269

13,949317

Interest expenses paid
Income taxes paid
Income taxes refunded(134)(7,514)
4,129

(130)
(3,758)2,243

36,754

12,621

Net cash provided by (used in) operating activities
Cash provided by (used in) investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Payments for loans receivableCollection of loans receivable
Proceeds from sales of shares of subsidiaries and affiliatedcompanies
Outflow due to loss of control of subsidiaries by share exchange
Other, net(2,716)(123)

50(4,416)74

2,851(7,585)
86

(714)
–
–

(832)
(19,616)
4,608

2,491

–

–
1,295

(7,550)(545)

Net cash provided by (used in) investing activities
Cash provided by (used in) financing activities
Net increase (decrease) in short-term loans payable
Proceeds from long-term loans payable
Proceeds from issuance of bonds
Purchase of treasury stock
Cash dividends paid
Other, net(3,935)(28,707)(19,290)
2,000
4,924
(4,106)(6,992)(354)

014,281–(0)(6,897)(334)

Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents(23,818)
2,824

7,050
(2,034)

Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period

11,824
6,127(11,070)
17,952

Cash and cash equivalents at end of period

17,952

6,881- 16 -

(6) Notes on Assumptions for Going Concern
Not applicable(7) Notes on Consolidated Financial Statements
1. Reporting entity
ARE Holdings, Inc. (hereinafter the “Company”) is a company located in Japan. The addresses of theCompany’s registered head office and principal offices are available on its website(https://www.asahiholdings.com). The Company’s consolidated financial statements have a fiscal year-end
date of March 31, 2024 and comprise the financial statements of the Company as well as its subsidiaries(the “Group”).
For the main activities of the Group, please refer to Note “5. Segment information.”
Effective July 1, 2023, the Company changed its name from Asahi Holdings, Inc. to ARE Holdings, Inc.

2. Basis of preparation(1) Statement of compliance with IFRSThe consolidated financial statements of the Group have been prepared based on IFRS issued by theInternational Accounting Standards Board.
Having met the requirements for a Specified Company under the Designated International
Accounting Standards, as prescribed in Article 1-2 of the Ordinance on the Terminology, Forms, andPreparation Methods of Consolidated Financial Statements (Ordinance of the Ministry of Finance No.
28 of 1976), the Group adopts the provisions of Article 93 of the aforementioned rules.
(2) Functional currency and presentation currency
The consolidated financial statements of the Group are presented in Japanese yen, which is thefunctional currency of the Company, and figures less than one million yen are rounded down to the nearest
million yen.

3. Material accounting policies
The material accounting policies adopted for the consolidated financial statements are the same as thosefor the consolidated financial statements for the fiscal year ended March 31, 2023.

4. Significant accounting estimates and associated judgements
In preparing consolidated financial statements, the management is required to make judgement,
estimates and assumptions that affect the adoption of accounting policies and the amounts of assets,
liabilities, revenues and expenses. Actual results may differ from such estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. The effect of a change inaccounting estimates is recognized in the accounting period in which such change occurs as well as theaccounting periods to be affected in the future.
The judgements, estimates and assumptions made by the management that may have material impacts
on the figures in the consolidated financial statements are the same as those for the consolidated financial
statements for the fiscal year ended March 31, 2023.

5. Segment information(1) Overview of reporting segments
The Group’s business segments are those Group constituent units for which separate financial
information is obtainable, and which the Board of Directors subjects to regular examination in order todecide the allocation of management resources and evaluate business results.
As a pure holding company, the Company is in charge of overall strategic function for the Group,
whereas operating companies of the Group engage in the precious and rare metals recycling businessand the refining and processing business, industrial waste management and other environmental
preservation business.

- 17 -

Therefore, the Group is composed of product and service segments based on business sectors. The tworeporting segments are the Precious Metals business and the Environmental Preservation business.
Meanwhile, these reporting segments are not aggregated.
The Precious Metals business engages mainly in recycling and selling precious and rare metals suchas gold, silver, palladium, platinum, and rhodium from scrap containing precious metals, as well as
refining and processing of precious metals centered on gold and silver. The main work of theEnvironmental Preservation business is the collection, transport and intermediate processing ofindustrial waste.
During the fiscal year under review, the Company conducted a share exchange between Japan Waste
Corporation (“Japan Waste”), which was a consolidated subsidiary of the Company, and Renatus Co.,
Ltd. (“Renatus”), whereby Renatus became the wholly owning parent company, and Japan Waste
became the wholly owned subsidiary company. Consequently, the Company reclassified the business ofJapan Waste under discontinued operations, and the amounts presented for segment information areamounts from continuing operations from which discontinued operations have been excluded. Pleaserefer to Note “7. Discontinued operations” for details on discontinued operations.
(Matters related to changes in reporting segments, etc.)
Effective from the fiscal year under review, due to changes in corporate organization and performance
management classifications within the Group, corporate expenses previously included in “Adjustments”
are now allocated to “Precious Metals Business” and “Environmental Preservation Business,” andrecorded as such.
Segment information for the fiscal year ended March 31, 2023 is presented according to the newclassification.
(2) Segment revenue and performance
Accounting policies of the reporting segments are the same as those of the Group stated in Note “3.
Material accounting policies.”
Revenue and other performance of each reporting segment of the Group are as follows.

- 18 -

For the fiscal year ended March 31, 2023 (from April 1, 2022 to March 31, 2023)
Reporting segment(Millions of yen)

Precious Metals
Business

Environmental
Preservation
Business274,205–

274,205

3

–

–

–

274,205–

17,243–

Other

Adjustments

Consolidated

274,209–274,209

–

–

–

–

274,2053

274,209–274,20917,243(961)

16,282–

16,282

Subtotal

Total

Revenue
External
revenue
Intersegment
revenue
Total
Operating profit
by businesssegment
Finance income
Finance costs

466
(795)

Other nonoperating
expenses(3,304)

Profit before tax

12,649Others:Depreciation andamortization

2,294

–

2,294

–

2,294

–

2,294

Impairment loss

525

–

525

–

525

–

525

–

–

–

(616)

(616)

–

(616)

Share of loss
(profit) ofinvestments
accounted forusing equity
method- 19 -

For the fiscal year ended March 31, 2024 (from April 1, 2023 to March 31, 2024)
Reporting segment(Millions of yen)

Precious Metals
Business

Environmental
Preservation
Business322,218–

322,218

34

–

–

–

322,218–

12,716(0)

Other

Adjustments

Consolidated

322,253–

322,253

–

–

–

–

322,21834

322,253–

322,253

12,716(348)

12,367–

12,367

Subtotal

Total

Revenue
External
revenue
Intersegment
revenue
Total
Operating profit
by businesssegment
Finance income
Finance costs

1,136(1,077)

Profit before tax

12,426

Others:Depreciation andamortization
Impairment loss

2,598

–

2,598

–

2,598

–

2,598

800

–

800

–

800

–

800

6. Impairment loss
For the fiscal year ended March 31, 2023 (from April 1, 2022 to March 31, 2023)
The impairment loss of 1,338 million yen on property, plant and equipment recognized during the fiscal
year ended March 31, 2023 is recorded as 525 million yen in “Other operating expenses” in the Consolidated
Statements of Income, and 812 million yen in “Expense” in revenue and expense of discontinued operations.
This impairment loss mainly consists of a loss (403 million yen) for the reduction of the book value ofbuildings, machinery and equipment of Asahi Refining Florida LLC in the Precious Metals Businesssegment to the recoverable value due to their scheduled retirement as a result of withdrawing from thecarbon treatment business, and a loss (804 million yen) for the reduction of the book value of buildings,
machinery and equipment of Japan Waste in the discontinued operations to the recoverable value due totheir scheduled retirement for the reconstruction of waste treatment facilities.
For the fiscal year ended March 31, 2024 (from April 1, 2023 to March 31, 2024)
The impairment loss of 800 million yen on property, plant and equipment recognized during the fiscal
year ended March 31, 2024 is recorded as 800 million yen in “Other operating expenses” in the Consolidated
Statements of Income. This impairment loss mainly relates to reduction of the book value of land andbuildings, etc. of ARE Holdings, Inc. in the Precious Metals Segment, which are scheduled for disposal orretirement due to the closure of the Ehime Plant and Shikoku sales office following the relocation andconsolidation of the catalyst treatment processes at the Ehime Plant to the new plant in Bando-shi, Ibaraki
Prefecture, with book value reduced to the recoverable amount, and the amount of reduction recorded as aloss.
Please refer to Note “7. Discontinued operations” for details on discontinued operations.

- 20 -

7. Discontinued operations(1) Results of discontinued operations
During the fiscal year under review, the Company conducted a share exchange between Japan Waste
Corporation (“Japan Waste”), which was a consolidated subsidiary of the Company, and Renatus Co.,
Ltd. (“Renatus”), whereby Renatus became the wholly owning parent company, and Japan Waste
became the wholly owned subsidiary company.
As a result, the operations of Japan Waste have become discontinued operations, and the profit (loss)
and cash flows associated with Japan Waste’s operations for the fiscal year under review have been
reclassified as discontinued operations, and similarly restated for the previous fiscal year, with thediscontinued operations displayed in a separate category.

Year ended March 31, 2023

(Millions of yen)
Year ended March 31, 2024

Revenue and expense of discontinued operations
Revenue (Note 1)

18,74636,649

Expense(15,342)(13,014)

Profit before tax from discontinued operations

3,403

23,635

Income tax expenses (Note 2)(1,011)(7,657)

Profit from discontinued operations
2,392
15,977
Notes: 1. Revenue for the fiscal year under review includes 20,353 million yen of share exchange gains.
2. Income tax expenses for the fiscal year under review includes (6,802) million yen of income tax expenses
pertaining to share exchange gains.
(2) Supplementary information about cash flow
An outflow of (7,550) million yen in cash and cash equivalents owned by Japan Waste and its
subsidiaries is presented as “Outflow due to loss of control of subsidiaries by share exchange” in cash
provided by (used in) investing activities in the consolidated statements of cash flows as a result of theCompany losing control over Japan Waste and its subsidiaries.

- 21 -

8. Per share information(1) Basic and diluted earnings per share
Year ended March 31, 2023
Continuing operations

110.29

Discontinued operations(Yen)
Year ended March 31, 2024
111.0630.91

208.47141.19319.54

Continuing operations

101.21101.94

Discontinued operations

27.51

185.07128.72287.01

Total basic earnings per share

Total diluted earnings per share(2) The basis for calculating basic earnings per share

Year ended March 31, 2023

(Millions of yen)
Year ended March 31, 2024

Profit attributable to owners of parent

10,92924,490

Profit from discontinued operations attributable toowners of parent

2,392

15,977

Profit from continuing operations used for
calculation of the basic earnings per share

8,537

8,512

(3) The basis for calculating diluted earnings per share
Year ended March 31, 2023
Profit from continuing operations used for
calculation of the basic earnings per share(Millions of yen)
Year ended March 31, 2024

8,537

8,512

265

288

Profit from continuing operations used for
calculation of the diluted earnings per share

8,803

8,800

Profit from discontinued operations used for
calculation of the diluted earnings per share

2,392

15,977

Profit used for calculation of the diluted earnings
per share

11,195

24,778Adjustments of profit for the year

(4) Weighted average number of common stockYear ended March 31, 2023
Weighted average number of common stock(Shares)Year ended March 31, 2024

77,410,371

76,643,154

9,565,091

9,689,567

86,975,462

86,332,721

Increase in number of common stock
Share acquisition rights
Weighted average number of diluted common stock

9. Subsequent events
Not applicable- 22 -

5. Others(1) Amounts of sales
Year ended March 31, 2023

Year ended March 31, 2024

AmountYear-on-Year

AmountYear-on-Year(Millions of yen)(%)

(Millions of yen)

(%)

Gold

169,436221.2

233,562137.8

Silver

6,008

109.6

6,824

113.6

Palladium

48,750104.0

24,921

51.1

Platinum

15,623

146.4

16,730

107.1

Other

34,390100.4

40,214

116.9

Total

274,209–322,253

117.5(Note) The Company reclassified the business of Japan Waste Corporation, which was a consolidated subsidiary of
the Company, under discontinued operations. Consequently, the Company restated “Amounts of sales” forthe previous fiscal year to amounts from continuing operations.

- 23 -