Business Results for the Second Quarter of the Year Ending December 31, 2015
(Six Months Ended June 30, 2015)[Japan GAAP] (Consolidated)
August 6, 2015
Company:
The Pack Corporation
Listed on the TSE1
Stock code:
3950
URL: http://www.thepack.co.jp
Representative: Yoshikazu Nakao, President & CEO
Contact:
Keiji Kimori, Senior Managing Director, General Manager of Administration HQ
TEL: +81-6-6972-1221
Expected date of filing of quarterly report:
August 11, 2015
Expected starting date of dividend payment:
September 9, 2015
Preparation of supplementary quarterly financial document:
Yes
Quarterly results briefing:
Yes (for institutional investors and securities analysts)(Rounded down to million yen)

1. Consolidated business results for the second quarter of the year ending December 31, 2015
(January 1, 2015 through June 30, 2015)(1) Consolidated results of operations(% change from the previous corresponding period)
Net sales
Million yen

Six months ended Jun. 30, 2015
Six months ended Jun. 30, 2014
(Note) Comprehensive income%

Operating income

Ordinary income

Million yen

Million yen%

Net income%

Million yen

40,239
2.4
2,257
6.5
2,375
6.3
39,311
2.3
2,120
6.6
2,234
9.6
Six months ended Jun. 30, 2015: 1,890 million yen (down 20.1%)
Six months ended Jun. 30, 2014: 2,365 million yen (up 42.3%)%(40.8)
86.9

Diluted net income pershare

Net income per share
Six months ended Jun. 30, 2015
Six months ended Jun. 30, 2014

1,418
2,397

Yen

Yen

71.50
120.5071.47-(2) Consolidated financial position
Total assets
Million yen

As of Jun. 30, 2015
As of Dec. 31, 2014
(Reference) Shareholders’ equity

Shareholders’ equity
ratio

Net assets
Million yen

66,54243,45970,30442,926
As of Jun. 30, 2015: 43,411 million yen

%

65.2
61.0
As of Dec. 31, 2014: 42,898 million yen

2. Dividends
End of 1Q

End of 2Q

Annual dividend
End of 3Q

Year-end

Total

Yen

Yen

Yen

Yen

Yen

-

25.00
25.00

-

25.00

50.00

-

25.00

50.00

Year ended Dec. 31, 2014
Year ending Dec. 31, 2015
Year ending Dec. 31, 2015
(forecasts)(Note) Revisions to the most recently announced dividend forecast: None

3. Forecast of consolidated business results for the year ending December 31, 2015
(January 1, 2015 through December 31, 2015)
Net sales
Million yen

Operating income%

Million yen%(% change from the previous corresponding period)
Ordinary income
Net income
Net income per share%

Million yen%

Yen

Fiscal year
89,000
3.7
5,700
4.1
5,900
3.4
(Note) Revisions to the most recently announced consolidated forecast: None

Million yen

3,600(16.7)

181.51

* Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries accompanying changes inthe scope of consolidation): None
(2) Application of special accounting methods in the preparation of quarterly consolidated financial statements:
None(3) Changes in accounting policies, accounting estimates and restatements
1) Changes in accounting policies associated with revision of accounting standards: Yes
2) Changes in accounting policies other than 1): None
3) Changes in accounting estimates: None
4) Restatements: None

(4) Shares outstanding (common shares)
1) Number of shares outstanding at the end of the period (treasury shares included)
As of Jun. 30, 2015:

19,900,000 shares

As of Dec. 31, 2014:

19,900,000 shares

As of Dec. 31, 2014:

6,672 shares

2) Number of treasury shares at the end of the period
As of Jun. 30, 2015:

224,582 shares

3) Average number of stock during the period
Six months ended Jun. 30, 2015:

19,832,981 shares

Six months ended Jun. 30, 2014:

19,892,598 shares*Implementation status of quarterly review procedure
This quarterly financial summary is not subject to the quarterly review procedure pursuant to the Financial Instruments andExchange Act. At the time of disclosure of this report, the review procedure of quarterly consolidated financial statements
pursuant to the Financial Instruments and Exchange Act has not been completed.
*Explanation regarding appropriate use of business forecasts and other special instructions
Forecasts regarding future performance in these materials are based on information that was available when this document was
released and incorporates a number of current assumptions about uncertainties that may affect future results of opera tions.
Therefore, actual results may differ significantly from the forecasts due to various factors. Please refer to "Explanation ofConsolidated Forecasts and Other Forward-looking Statements" on page 3 for forecast assumptions.

The Pack Corporation (3950) Financial Report for the Second Quarter of 2015

Contents of Attachments
1. Qualitative Information on Quarterly Consolidated Financial Performance2(1) Explanation of Results of Operations

2(2) Explanation of Financial Position

3(3) Explanation of Consolidated Forecasts and Other Forward-looking Statements

3

2. Matters Related to Summary Information (Notes)

3(1) Changes in Significant Subsidiaries during the Period

3(2) Application of Special Accounting Methods for Presenting Quarterly Con solidated Financial Statements

3(3) Changes in Accounting Policies and Accounting-based Estimates, and Restatements

4

3. Quarterly Consolidated Financial Statements

5(1) Quarterly Consolidated Balance Sheet

5(2) Quarterly Consolidated Statement of Income and Quarterly Consolidated Statement of Comprehensive
Income7(3) Quarterly Consolidated Statement of Cash Flows

9(4) Notes to Quarterly Consolidated Financial Statements

11

Going Concern Assumption

11

Significant Changes in Shareholders’ Equity

11

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The Pack Corporation (3950) Financial Report for the Second Quarter of 2015

1. Qualitative Information on Quarterly Consolidated Financial Performance(1) Explanation of Results of Operations
In the first half of 2015, the yen weakened and stock prices rose along with economic stimulus measures by theJapanese government and monetary easing by the Bank of Japan. The result was a recovery in corporate earnings,
mainly at exporting companies, and an increase in the number of jobs. In addition, spending by foreign tourists inJapan remained high.
On the other hand, consumer spending remained lackluster because of rising prices caused by the yen’s decline.
In addition, the Greek debt problem continued and economic growth slowed in China. As a result, prospects for afull-scale economic recovery are still unclear.
During the first half, there were many activities to accomplish the goals of the medium -term plan under theslogan of “with a positive attitude, speed and accuracy.” All group companies were focused on entering newmarkets and selling products at suitable prices, and engaged in activities such as proactive capital expenditures,developing new products and improving product quality in order to grow earnings.
Net sales increased 2.4% year-on-year to 40,239 million yen, operating income increased 6.5% to 2,257 million
yen, ordinary income increased 6.3% to 2,375 million yen, and net income decreased 40.8% to 1,418 million yen.
Business segment performance was as follows.
(Paper Products)
The paper products segment accounted for 59.4% of consolidated sales in the first half of 2015. Sales of paperbags, which accounted for 32.0% of consolidated sales, increased 5.1% to 12,865 million yen. The main reasons
were the inclusion of sales of NISHINIHON PRINTING CO., LTD., which became a subsidiary in April 2014,and higher sales at THE PACK AMERICA CORP.
Sales of paper folding cartons, which accounted for 14.3% of consolidated sales, increased 1.0% to 5,757 million
yen mainly because of higher sales of cartons for food products used in convenience stores.
Sales of corrugated boxes, which accounted for 10.7% of consolidated sales, increased 0.2% to 4,321 million yen.
Although there were signs of a recovery due to higher sales to some customers in the manufacturing sector, sales
in all other market sectors were sluggish.
Printing sales, which accounted for 2.4% of consolidated sales, decreased 6.2% to 970 million yen as orders wereweak at both Keihin Tokushu Printing Corp. and NIKKO PRINT CORPORATION.
Overall, sales in this segment increased 2.7% to 23,915 million yen. Operating income was up 3.3% to 1,665
million yen.
(Film Packaging)
The film packaging segment accounted for 22.1% of consolidated sales in the first half of 2015. Segment
performance benefited from strong orders for plastic bags for disposable diapers, supported in part by sales ofthese diapers to foreign tourists in Japan. As a result, sales increased 5.9% to 8,883 million yen. Operating
income was up 14.5% to 363 million yen.
(Other Businesses)
Other businesses accounted for 18.5% of consolidated sales in the first half of 2015. There was a decline in salesof products used in conjunction with the Pack Assortment Service system, which is a comprehensive outsourcing
vendor system that covers everything from manufacturing and procuring packaging materials and other products
to inventory control and delivery. As a result, sales decreased 2.5% to 7,440 million yen and operating income
increased 6.2% to 615 million yen due to cost reductions and other factors.

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The Pack Corporation (3950) Financial Report for the Second Quarter of 2015

(2) Explanation of Financial Position
1) Balance sheet position
Assets totaled 66,542 million yen at the end of the second quarter of 2015, down 3,761 mill ion yen from the endof 2014. The main factors were increases of 4,317 million yen in cash and deposits , 619 million yen in
investment securities, and decreases of 5,771 million yen in notes and accounts receivable-trade, and 2,799
million yen in securities.
Liabilities decreased 4,294 million yen to 23,082 million yen. The main factors were decreases of 4,104 million
yen in notes and accounts payable-trade, and 572 million yen in income taxes payable.
Net assets increased 533 million yen to 43,459 million yen. The main factors were increases of 608 million yen
in retained earnings and 465 million yen in valuation difference on available-for-sale securities.
2) Cash flow position
The balance of cash and cash equivalents at the end of the second quarter of 2015 decreased 818 million yen, or6.2% from the end of the second quarter of 2014 to 12,319 million yen.
Cash flows from operating activities
Operating activities provided net cash of 3,198 million yen (net cash provided of 4,343 million yen in the firsthalf of 2014). The principal factors were income before income taxes and minority interests of 2,353 million yen
and a decrease of 4,113 million yen in notes and accounts payable-trade, while there was a decrease of 5,787
million yen in notes and accounts receivable-trade.
Cash flows from investing activities
Investing activities used net cash of 965 million yen (net cash used of 824 million yen in the first half of 2014).
The principal factors were outlays of 681 million yen for the purchase of property, plant and equipment and2,000 million yen for the purchase of securities, while there were proceeds from sales of securities of 1, 600
million yen.
Cash flows from financing activities
Financing activities used net cash of 1,064 million yen (net cash used of 948 million yen in the first half of 2014).
This was mainly due to outlays of 497 million yen for the cash dividends paid and 556 million yen for thepurchase of treasury shares.
(3) Explanation of Consolidated Forecasts and Other Forward-looking Statements
The consolidated forecasts announced on February 12, 2015 remain unchanged.
2. Matters Related to Summary Information (Notes)(1) Changes in Significant Subsidiaries during the Period
Not applicable.
(2) Application of Special Accounting Methods for Presenting Quarterly Consolidated Financial Statements
Not applicable.

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The Pack Corporation (3950) Financial Report for the Second Quarter of 2015

(3) Changes in Accounting Policies and Accounting-based Estimates, and Restatements
Changes in Accounting Policies
Application of the Accounting Standard for Retirement Benefits
The Company has applied the “Accounting Standard for Retirement Benefits (Accounting Standards Board ofJapan (ASBJ) Statement No. 26, May 17, 2012)” and the “Guidance on Accounting Standard for Retirement
Benefits (ASBJ Guidance No. 25, March 26, 2015)” from the first quarter of 2015, for provisions set forth in themain clauses of Paragraph 35 of the Accounting Standard for Retirement Benefits and Paragraph 67 of the
Guidance on Accounting Standard for Retirement Benefits. Accordingly, the Company reviewed the methods forcalculating retirement benefit obligations and service costs, and revised the method of attributing estimatedretirement benefit obligations to periods from the straight-line basis to the benefit formula basis, and revised themethod of determining the discount rate from the method using the approximate number of years of expected
average length of the remaining service period of employees to the method using a single weighted average
discount rate.
For the application of these accounting standards, etc. in accordance with the transitional accounting treatments
set forth in Paragraph 37 of the Accounting Standard for Retirement Benefits, the adjustments associated with thechange in calculation methods of retirement benefit obligations and service costs are recorded in retained
earnings at the beginning of the first half of 2015.
The result was an increase of 487 million yen in net defined benefit liability and a decrease of 314 million yen inretained earnings at the beginning of the first half of 2015. The effect of this change on operating income,ordinary income and income before income taxes and minority interests in the first half of 2015 is insignificant.

-4-The Pack Corporation (3950) Financial Report for the Second Quarter of 2015

3. Quarterly Consolidated Financial Statements(1) Quarterly Consolidated Balance Sheet
Previous fiscal year
(As of December 31, 2014)(Million yen)
Second quarter ofthe current fiscal year
(As of June 30, 2015)

AssetsCurrent assets
Cash and deposits

7,248

11,566

Notes and accounts receivable-trade22,914

17,143

Securities

6,199

3,399

Merchandise and finished goods

5,232

5,260

Work in process

688

748

Raw materials and supplies

749

705

Deferred tax assets

192

155

Other

453

788

Allowance for doubtful accounts

(11)

(9)

43,66739,759Buildings and structures, net

7,699

7,864

Machinery, equipment and vehicles, net

5,109

4,810

231

211

8,066

8,066

525

414

21,632

21,366178

153

Investment securities

3,637

4,256

Deferred tax assets

521

443

Total current assets
Non-current assets
Property, plant and equipment

Tools, furniture and fixtures, net
LandConstruction in progress
Total property, plant and equipment
Intangible assets
Investments and other assets

Other

732

629

Allowance for doubtful accounts

(66)

(66)

Total investments and other assets

4,825

5,263

26,636

26,78370,30466,542

Total non-current assets
Total assets-5-

The Pack Corporation (3950) Financial Report for the Second Quarter of 2015

(Million yen)
Second quarter ofthe current fiscal year
(As of June 30, 2015)

Previous fiscal year
(As of December 31, 2014)
Liabilities
Current liabilities
Notes and accounts payable-trade

19,39815,293

Income taxes payable

1,408

835

Provision for bonuses

181

161

Provision for directors' bonuses

35

17

Other

2,794

2,769

Total current liabilities

23,81819,078

3,034

3,501

Deferred tax liabilities

322

316

Other

202

186

3,559

4,004

27,37723,082

2,553

2,553

Non-current liabilities
Net defined benefit liability

Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus

3,167

3,167

Retained earnings

36,33036,939(6)(562)

42,04542,098

1,108

1,574

39

14

Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment

(74)

(54)

Remeasurements of defined benefit plans

(220)

(221)

852

1,312

Subscription rights to shares-

20

Minority interests

27

28

42,92643,45970,30466,542

Total accumulated other comprehensive income

Total net assets
Total liabilities and net assets-6-

The Pack Corporation (3950) Financial Report for the Second Quarter of 2015(2) Quarterly Consolidated Statement of Income and Quarterly Consolidated Statement of Comprehensive
IncomeQuarterly Consolidated Statement of Income(For the Six-month Period)

Net sales
Cost of sales

First six months ofthe previous fiscal year
(from January 1, 2014
to June 30, 2014)
39,31130,467(Million yen)First six months ofthe current fiscal year
(from January 1, 2015
to June 30, 2015)
40,23931,231Gross profit

8,844

9,007

Selling, general and administrative expenses
Freightage and packing expenses
Salaries and allowances
Directors' compensations
Provision of allowance for doubtful accounts
Provision for bonuses
Provision for directors' bonuses
Retirement benefit expenses
Depreciation
Rent expenses
Other

1,813
1,853
191
(2)
90
14
205
323
1,082
1,152

1,818
1,825
234
(0)
86
17
214
290
1,102
1,161

6,724

6,750

2,120

2,257

41
37
47

47
45
63

126

156

4
1
5

0
1
17
18

11

37

Ordinary income

2,234

2,375

Extraordinary income
Gain on sales of investment securities
Gain on sales of non-current assets
Gain on bargain purchase

0
1,064

20
6
-

1,065

26

12
0
-

1
3
44

Total selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Loss on sales of accounts receivable
Foreign exchange losses
Other
Total non-operating expenses

Total extraordinary income
Extraordinary losses
Loss on sales of non-current assets
Loss on retirement of non-current assets
Loss on valuation of investment securities
Compensation expenses
Total extraordinary losses
Income before income taxes and minority interests
Income taxes-current
Income taxes-deferred
Total income taxes
Income before minority interests
Minority interests in income (loss)
Net income
-7-

13

49

3,286

2,353

897
(8)

807
127

888

935

2,397

1,418

0

(0)

2,397

1,418

The Pack Corporation (3950) Financial Report for the Second Quarter of 2015

Quarterly Consolidated Statement of Comprehensive Income(For the Six-month Period)First six months ofthe previous fiscal year
(from January 1, 2014
to June 30, 2014)
2,397(Million yen)First six months ofthe current fiscal year
(from January 1, 2015
to June 30, 2015)
1,418

27

465

Deferred gains or losses on hedges

(7)

(24)

Foreign currency translation adjustment

(51)

20

Income before minority interests
Other comprehensive income
Valuation difference on available-for-sale securities

Remeasurements of defined benefit plans, net of tax

-

10

(31)

471

2,365

1,890

Comprehensive income attributable to owners of parent

2,366

1,889

Comprehensive income attributable to minority interests(1)0

Total other comprehensive income
Comprehensive income
Comprehensive income attributable to-8-

The Pack Corporation (3950) Financial Report for the Second Quarter of 2015(3) Quarterly Consolidated Statement of Cash FlowsFirst six months ofthe previous fiscal year
(from January 1, 2014
to June 30, 2014)(Million yen)First six months ofthe current fiscal year
(from January 1, 2015
to June 30, 2015)

3,286
901
(1,064)
0
(3)
3
(15)
50
(78)
4
(0)
12
0
5,468
(550)
(3,561)
512

2,353
838
(2)
(19)
(17)
(4)
(93)
0
(4)
3
(20)
5,787
(41)
(4,113)(182)

Subtotal

4,967

4,482

Interest and dividend income received
Interest expenses paid
Income taxes paid

72
(4)
(691)

89
(0)
(1,373)

Net cash provided by (used in) operating activities

4,343

3,198

(1,200)
1,400
(37)
14
(698)
0
(16)
(26)
-

(2,000)
1,600
(6)
11
(681)
8
(6)
(22)
42

(238)

-

Cash flows from operating activities
Income before income taxes and minority interests
Depreciation
Gain on bargain purchaseAmortization of goodwill
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for directors' bonuses
Increase (decrease) in provision for retirement benefits
Increase (decrease) in net defined benefit liability
Interest and dividend income
Interest expenses
Loss (gain) on sales of non-current assets
Loss on retirement of non-current assets
Loss (gain) on sales of investment securities
Loss (gain) on valuation of investment securities
Decrease (increase) in notes and accounts receivable-trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable-trade
Other, net

Cash flows from investing activities
Purchase of securities
Proceeds from sales of securities
Payments of loans receivableCollection of loans receivable
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from sales of investment securities
Purchase of shares of subsidiaries resulting in change inscope of consolidation
Other, net
Net cash provided by (used in) investing activities

-9-

(20)

89

(824)

(965)

The Pack Corporation (3950) Financial Report for the Second Quarter of 2015

First six months ofthe previous fiscal year
(from January 1, 2014
to June 30, 2014)(Million yen)First six months ofthe current fiscal year
(from January 1, 2015
to June 30, 2015)

Cash flows from financing activities
Net increase (decrease) in short-term loans payable
Repayments of long-term loans payable
Cash dividends paid
Purchase of treasury shares
Proceeds from sales of treasury shares
Other, net

(100)
(375)
(484)
11
-

(497)
(556)
(11)

Net cash provided by (used in) financing activities(948)(1,064)(14)

4Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents

2,556

1,173

Cash and cash equivalents at beginning of period

10,581

11,145

Cash and cash equivalents at end of period

13,137

12,319- 10 -

The Pack Corporation (3950) Financial Report for the Second Quarter of 2015(4) Notes to Quarterly Consolidated Financial Statements
Going Concern Assumption
Not applicable.
Significant Changes in Shareholders’ Equity
Not applicable.

* This financial report is solely a translation of summary of “Kessan Tanshin” (in Japanese, including attachments), which
has been prepared in accordance with accounting principles and practices generally accepted in Japan, for theconvenience of readers who prefer an English translation.

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