CKD Corporation andConsolidated Subsidiaries
Consolidated Financial Statements
for the Years Ended
March 31, 2018 and 2017

[Consolidated Financial Statements, etc.](1) [Consolidated Final Statement]① [Consolidated Balance Sheet]
Consolidated
Accounting Year(as of March 31, 2017)(Unit : million yen)
Consolidated
Accounting Year(as of March 31, 2018)

AssetsCurrent assets
Cash and deposits

13,336

15,245

Notes and accounts receivable-trade
Electronically recorded monetary claims-operating

23,7583,693

26,721
5,215

Operating accounts receivable
Short-term investment securities

263
1,000249Merchandise and finished goods
Work-in-process

5,526
3,956

－
8,840
4,782

Raw materials and supplies
Deferred tax assets

14,472
1,521

21,0942,045

Other
Allowance for doubtful accounts

1,455
(99)

1,687
(109)

Total current assets

68,88385,772

Noncurrent assets
Property, plant and equipment
Buildings and structures (net)

11,517

13,350Machinery, equipment and vehicles (net)
Tools, furniture and fixtures (net)

8,799
1,401

10,4491,903

Land
Lease assets (net)

4,570
122

6,206
134

Construction in progress

651

1,153

27,06233,199Intangible assets

1,756

2,612

Investments and other assets
Investment securities

7,229

9,411

Net defined benefit assets
Deferred tax assets

454
223

768
122

OtherAllowance for doubtful accounts

782
(31)

966
(31)

Total investments and other assets

8,658

11,237

Total property, plant and equipment

Total noncurrent assets
Total assets

37,47747,048106,361

132,820

(Unit : million yen)
Consolidated
Accounting Year(as of March 31, 2018)

Consolidated
Accounting Year(as of March 31, 2018)
Liabilities
Current liabilities
Notes and accounts payable-trade
Electronically recorded obligations-operating
Short-term loans payable
Current portion of bonds
Current portion of long-term loans payable
Lease obligations
Accrued expenses
Income taxes payable

14,774
1,385

19,021
2,429

882

2,899
55

－470
71

3,691
76

3,039
2,406

3,808
2,261

Provision for bonuses
Provision for product warranties

227
317

414
412

Provision for loss on order received
Other

29
6,041

78
7,923

Total current liabilities

29,64543,074Long-term loans payable
Lease obligations－2,25058

4,84566

Deferred tax liabilities
Provision for environmental measures

1,626
75

2,398
161

258
190

390
192

Other

1,298

1,440

Total noncurrent liabilities

5,758

9,687

35,40352,762

Capital stock
Capital surplus

11,016
12,372

11,016
12,383Retained earnings
Treasury stock

49,723(4,906)56,812(4,908)

Total shareholders' equity

68,20675,304

2,653

3,857

Foreign currency translation adjustment
Remeasurements of defined benefit plans

1,323(1,225)

1,686
(899)

Total accumulated other comprehensive income

2,751

4,644－109Noncurrent liabilities
Bonds payable

Net defined benefit liabilities
Asset retirement obligations

Total liabilities

191

Net assets
Shareholders’ equity

Accumulated other comprehensive income
Valuation difference on available-for-sale securities

Non-controlling interests
Total net assets
Total liabilities and net assets

70,95780,058106,361

132,820

②[Consolidated Statements of income and Statements of comprehensive income][Consolidated Statements of income]Net sales
Cost of sales

Consolidated
Accounting Year
(April 1, 2016 toMarch 31, 2017)
94,01265,284(Unit : million yen)
Consolidated
Accounting Year
(April 1, 2017 toMarch 31, 2018)
115,700
79,864Gross profit

28,72735,835

Selling, general and administrative expenses
Personal expenses

8,433

9,769

Retirement benefit expenses
Packing and transportation expenses

375
1,033

417
1,590

Rent expenses
Business consignment expenses

1,178
1,158

1,382
1,585

369
8450

Depreciation
Provision of allowance for doubtful accounts
Research and development expense
Enterprise tax

3,348
408

－
4,330
422

Other

2,832

3,412

Total selling, general and administrative expenses

19,14623,363

9,580

12,472

Operating income
Non-operating income
Interest income

2516

Dividends income
Office work fee

119
71

13562

Other279

380

Total non-operating income

496

594

Non-operating expenses
Interest expenses

3971

Sales discounts
Share of loss of entities accounted for using equity
methodLoss on valuation of derivatives

142

155

－48

43

93

Foreign exchange losses
Other

38
41

104
125

Total non-operating expenses

305

598

9,771

12,469Gain on sales of noncurrent assets
Gain on sales of investment securities

3182

324
76

Gain on bargain purchase
Subsidy income－206

149
56

Total extraordinary income

392607

Loss on sales of noncurrent assets
Loss on retirement of noncurrent assets

731

889

Loss on reduction of noncurrent assets
Provision for environmental measures

205
－

56
85

Total extraordinary loss

244

240

Income before income taxes

9,919

12,836

Ordinary income
Extraordinary income

Extraordinary loss

Income taxes-current

3,360(Unit : million yen)
Consolidated
Accounting Year
(April 1, 2017 toMarch 31, 2018)
3,875

Income taxes-deferred(399)(246)

Total income taxes

2,961

3,629

Net income

6,9589,207

Consolidated
Accounting Year
(April 1, 2016 toMarch 31, 2017)

Net income attributable to non-controlling interests
Net income attributable to owners of parent－65

6,958

9,142

[Consolidated Statements of Comprehensive Income]

6,958(Unit : million yen)
Consolidated
Accounting Year
(April 1, 2017 toMarch 31, 2018)
9,207

Valuation difference on available-for-sale securities
Foreign currency translation adjustment

(452)
(484)

1,203
359

Remeasurements of defined benefit plans
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income

197326－3(739)

1,893

Comprehensive income

6,219

11,100(Details)
Comprehensive income attributable to owners of theparent
Comprehensive income attributable to non-controllinginterests

6,219

11,035－64

Consolidated
Accounting Year
(April 1, 2016 toMarch 31, 2017)
Net income
Other comprehensive income

③[Consolidated Statement of Changes in Net Assets]
Consolidated Accounting Year (April 1, 2016 to March 31, 2017)(Unit : million yen)
Shareholders' equity
Capital stock
Balance at the beginning ofcurrent period
Changes of items during
the period
Dividends from surplus
Net income attributableto owners of parent
Purchase of treasurystock
Disposal of treasury stock
Employee encouragement
and welfare fundChange in the scope ofconsolidation
Purchase of shares ofconsolidated subsidiaries
Net changes of items
other than shareholders'equityTotal changes of items
during the period
Balance at the end ofcurrent period

Capital surplus

Retained earnings

12,37244,445

11,016

Treasury stock

Total shareholders'equity(4,905)62,929(1,671)(1,671)

6,958

6,958
(0)

(0)
－

(3)

(3)

(6)

(6)
－－－

5,277(0)5,276

11,016

12,372

49,723(4,906)

68,206

Accumulated other comprehensive income
TotalValuation
Foreign currency Remeasurements accumulated Non-controlling Total net assets
difference oninterests
translationof defined
otheravailable-foradjustment
benefit plans comprehensive
sale securities
incomeBalance at the beginning ofcurrent period
Changes of items during
the period
Dividends from surplus
Net income attributableto owners of parent
Purchase of treasurystock
Disposal of treasury stock
Employee encouragement
and welfare fundChange in the scope ofconsolidation
Purchase of shares of
consolidated subsidiaries
Net changes of items
other than shareholders'equityTotal changes of items
during the period
Balance at the end ofcurrent period

3,105

1,808

(1,423)3,490－

66,419(1,671)
6,958
(0)
－
(3)
(6)
－
(452)

(484)

197

(739)

(739)

(452)

(484)

197

(739)

－

4,537

2,653

1,323

(1,225)

2,751－

70,957

Consolidated Accounting Year (April 1, 2017 to March 31, 2018)(Unit : million yen)
Shareholders' equity
Capital stock
Balance at the beginning ofcurrent period
Changes of items during
the period
Dividends from surplus
Net income attributableto owners of parent
Purchase of treasurystock
Disposal of treasury stock
Employee encouragement
and welfare fundChange in the scope of
consolidation
Purchase of shares of
consolidated subsidiaries
Net changes of items
other than shareholders'equityTotal changes of items
during the period
Balance at the end ofcurrent period

Capital surplus

Retained earnings

12,372

49,723

11,016

Total shareholders'equityTreasury stock(4,906)

68,206(2,043)(2,043)

9,142

9,142

0(2)

(2)

00

(9)

(9)
－

1111－

11

7,089

(2)

7,097

11,016

12,38356,812(4,908)75,304

Accumulated other comprehensive income
TotalValuation
Foreign currency Remeasurements accumulated Non-controlling Total net assets
difference oninterests
translationof defined
otheravailable-foradjustment
benefit plans comprehensive
sale securities
incomeBalance at the beginning ofcurrent period
Changes of items during
the period
Dividends from surplus
Net income attributableto owners of parent
Purchase of treasury
stock
Disposal of treasury stockEmployee encouragement
and welfare fundChange in the scope ofconsolidation
Purchase of shares of
consolidated subsidiaries
Net changes of items
other than shareholders'equityTotal changes of items
during the period
Balance at the end ofcurrent period

2,653

1,323

(1,225)

2,751－

70,957(2,043)
9,142(2)
0(9)
－
11
1,203

363

326

1,893

109

2,002

1,203

363

326

1,893

109

9,100

3,857

1,686(899)

4,644

109

80,058

④[Consolidated Statements of Cash Flow](Unit : million yen)
Consolidated
Accounting Year
(April 1, 2017 toMarch 31, 2018)

Consolidated
Accounting Year
(April 1, 2016 to
March 31, 2017)
Cash flows from operating activities
Income before income taxes

9,919

12,836

3,964

4,230

－48－
53253

(149)

Decrease (increase) in net defined benefit assets
Decrease (increase) in notes and accounts receivable-trade164(3,648)156(3,069)Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable-trade(3,557)
3,473(9,913)
4,156

Increase (decrease) in advances received
Other

1,117
898

(153)
813

Sub-total

12,6399,419Depreciation and amortization
Share of (profit) loss of entities accounted for using equity
methodGain on bargain purchase
Increase (decrease) in provision for bonuses
Increase (decrease) in accounts payable-bonuses

Interest and dividends income received

86376

146

151

Interest expenses paid
Income taxes paid

(39)
(2,584)(71)(3,957)

Net cash provided by (used in) operating activities

10,163

5,542

Cash flows from investing activities
Payments into time deposits

(237)

(53)

Proceeds from withdrawal of time deposits
Net decrease (increase) in short-term investment securities

417
1,00033

Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment(4,067)
5－(6,596)400

Purchase of intangible assets
Purchase of investment securities(1,175)(457)(1,532)
(819)

569

457

－

826

Proceeds from sales of investment securities
Proceeds from purchase of shares of subsidiaries resulting inchange in scope of consolidation
Other
Net cash provided by (used in) investing activities(136)

10(4,081)(7,273)

(2)

1,650
6,313

Cash flows from financing activities
Net increase (decrease) in short-term loans payable
Proceeds from long-term loans payable
Repayment of long-term loans payable
Redemption of bonds
Purchase of treasury stock
Cash dividends paid
Payments from changes in ownership interests in subsidiaries
that do not result in change in scope of consolidation
Other－(770)－(0)(1,672)(3,202)(62)(2)(2,038)

－(11)

(60)

(86)

Net cash provided by (used in) financing activities(2,505)2,559

Effect of exchange rate change on cash and cash equivalents

(14)

65

Net increase (decrease) in cash and cash equivalents

3,561894

Cash and cash equivalents at beginning of period
Increase (decrease) in cash and cash equivalents resulting fromchange of scope of consolidation
Cash and cash equivalents at end of period

10,342

13,9050－

13,905

14,799[Segment information]
1. Outline of reporting segments
The reporting segments of the CKD Group refers to the constituents of CKD and its subsidiaries that separate financial statements
are available and that are the scope of regular discussion by the Board of Directors of CKD to determine how corporate resources
are to be allocated and to evaluate business performance.
The constituents of the CKD Group consist of product segments, which include two reporting segments of ‘Automatic Machineries’and ‘Components’ separated based on the type, properties, and sales method of products.
In Automatic Machineries Products, automatic packaging system, lithium ion battery manufacturing system, and other large-scale
facilities are manufactured and sold. They are produced upon receiving an order.
In Component Products, functional parts that can be applied to semiconductor-related businesses, automobile-related industries, andother markets of diversified kinds are manufactured and sold. They are produced by forecasting demands of each item.
2. Calculation methods of sales, income/loss, assets, liabilities and other accounting items for each reporting segment
The accounting methods used for financial statements of respective reporting segments are basically the same as those stated in“Important matters fundamental to the preparation of consolidated financial statements.”
The income in each reporting segment are based on operating income. Internal gains and amount of transfer among segments arebased on current market prices.
3. Information on reporting-segment-wise sales, income/loss, assets, liabilities, and other accounting items
Fiscal year ended March 31, 2017 (April 1, 2016 to March 31, 2017)(Unit : million yen)Amount shown inthe consolidated
Amount Adjusted
financial(Note 1)statement(Note 2)

Reporting segment
Automatic
MachineriesComponents

Total

Net sales
18,38075,631

94,012－

94,012

－

9494

(94)

－

Total

18,38075,726

94,107(94)

94,012

Segment income

2,103

11,18913,292(3,711)

9,580

Segment assets

21,93071,15493,085

13,276

106,361

Depreciation and amortization

867

2,910

3,777

186

3,964

Increase in property, plant andequipment and intangible
assets

1,027

2,542

3,569

1,294

4,864

Sales to external customers
Intersegment sales or transfers

Other items

Note 1: Details of the amount adjusted
1. The amount of adjustment for ‘Net sales’ of ¥(94) million is derived from elimination of transactions among segments.
2. The amount of adjustment for ‘Segment income’ of ¥(3,711) million includes ¥34 million for elimination of transactions
among segments and ¥(3,745) million as the total company expenses that are not allocated to each reporting segment.
The total company expenses mainly refers to expenses related to administration and long-term R&D expenses of CKD
and costs related to CKD Global Service Corporation.
3. The amount of adjustment for ‘Segment assets’ of ¥13,276 million is the total company assets not allocated to eachreporting segment. This mainly consists of working surplus funds (cash and deposits and short-term securities) and longterm investment funds (investment securities).
4. The amount adjusted for depreciation of ¥186 million consists of depreciation related to assets for the entire Company.

5. The amount adjusted for increase in property, plant and equipment and intangible assets of ¥1,294 million consists of theamount of property, plant and equipment and intangible assets for the entire Company.
Note 2: ‘Segment income’ has already been adjusted with operating income shown in the consolidated statement of income.
Fiscal year ended March 31, 2018 (April 1, 2017 to March 31, 2018)(Unit : million yen)Amount shown inthe consolidated
Amount Adjustedfinancial(Note 1)statement(Note 2)

Reporting segment
Automatic
MachineriesComponents

Total

Net sales
16,34499,355

115,700－

115,700

084

84(84)－Total

16,34599,439115,784(84)

115,700

Segment income

1,176

15,831

17,007(4,534)

12,472

Segment assets

20,47998,054

118,533

14,286

132,820

Depreciation and amortization

822

3,175

3,997

233

4,230

Increase in property, plant andequipment and intangible
assets

569

8,221

8,791

631

9,422

Sales to external customers
Intersegment sales or transfers

Other items

Note 1: Details of the amount adjusted
1. The amount of adjustment for ‘Net sales’ of ¥(84) million is derived from elimination of transactions among segments.
2. The amount of adjustment for ‘Segment income’ of ¥(4,534) million includes ¥34 million for elimination of transactions
among segments and ¥(4,568) million as the total company expenses that are not allocated to each reporting segment.
The total company expenses mainly refers to expenses related to administration and long-term R&D expenses of CKD
and costs related to CKD Global Service Corporation.
3. The amount of adjustment for ‘Segment assets’ of ¥14,286 million is the total company assets not allocated to eachreporting segment. This mainly consists of working surplus funds (cash and deposits) and long-term investment funds(investment securities).
4. The amount adjusted for depreciation of ¥233 million consists of depreciation related to assets for the entire Company.
5. The amount adjusted for increase in property, plant and equipment and intangible assets of ¥631 million consists of theamount of property, plant and equipment and intangible assets for the entire Company.
Note 2: ‘Segment income’ has already been adjusted with operating income shown in the consolidated statement of income.