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Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending September 30, 2020
(FY9/20) (Six Months Ended March 31, 2020) [IFRS]
June 12, 2020
Company name:

Stock Exchange
Listing:
URL https://www.airtrip.co.jp

AirTrip Corp.

Stock code:

TSE

6191
Yusuke Shibata, Representative Director,
Representative:
President and CFO
Yusuke Shibata, Representative Director,
Contact:
TEL: +81-(0)3-3431-6191
President and CFO
Scheduled date of filing of Quarterly
Scheduled date of payment ofJune 17, 2020－
Report:dividend:
Preparation of supplementary materials for quarterly financial results: Yes
Holding of quarterly financial results briefing: Yes (for institutional investors and securities analysts)(All amounts are rounded down to the nearest million yen)

1. Consolidated Financial Results for the Second Quarter (October 1, 2019 to March 31, 2020) of FY9/20(1) Consolidated results of operations(Percentages represent year–on–year changes.)
OperatingincomeNet sales
Millionsof yen%Millions ofyen

Six months ended Mar. 31,
15,383 44.5 △660
2020
Six months ended Mar. 31,
10,643 208.5 178
2019%

Millions of yen

Millions of yen- △779140△77.4

Profit attributable to Total comprehensive
owners of parent
incomeProfit%- △759

△82.2

152

%

Millionsof yen- △741
78△74.4

Millions of yen%- △791

-

145

△74.8

%

△84.7

Fully diluted profit per
share

Profit per share
Six months ended Mar. 31,
2020
Six months ended Mar. 31,
2019

Profit before
income taxes

Yen

Yen

△37.14△37.144.31

4.16(2) Consolidated financial position
Total assets

Ratio of equity
attributable to owners ofparentEquity attributable toowners of parent

Total equity

Millions of yen

Millions of yen

Millions of yen%

34,821
31,216

9,607
10,101

9,260
9,719

26.5
31.0

As of Mar. 31, 2020
As of Sep. 30, 2019

2. Dividends
Dividend per share
1Q-end2Q-endYen

3Q-endYen

Fiscal year ended Sep.
―
0.00
30, 2019
Fiscal year ending―
0.00
Sep. 30, 2020
Fiscal year ending Sep. 30,
2020 (Estimated)
Note: Revision to the most recently announced dividend forecast: None

Year-end
Yen

Yen

Yen

―

10.00

10.00

―

―

―

3. Full-year financial forecast for FY9/20 (October 1, 2019 – September 30, 2020)
―1―

Total

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The full-year financial forecast has yet to be determined because the environment surrounding the Company has changed dramatically
due to COVID-19, making it very difficult to forecast the full-year financial results at the present time.
The Company will carefully assess the impact on its financial results and promptly make an announcement when it is possible to makea reasonable forecast.

―2―

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更新日時:2020/06/09 19:44:31* Notes(1) Changes in significant subsidiaries during the period (changes in specified： Nonesubsidiaries resulting in changes in scope of consolidation)
Newly included:– companies

Excluded:– companies(2) Changes in accounting policies and accounting-based estimates, and restatements
1) Change of the accounting policy required under IFRS

： None2) Changes in accounting policies other than 1) above： None3) Changes in accounting-based estimates： None(3) Numbers of outstanding shares (common stock)1) Number of shares outstanding as of the end of the

As of Mar. 31, 2020

20,115,300

As of Mar. 31, 201919,801,300

2) Number of treasury shares as of the end of the period As of Mar. 31, 202035

As of Sep. 30, 201935

period (including treasury shares)

3) Average number of shares issued during the period

Six months ended

Six months ended
19,956,777

Mar. 31, 2020

18,140,989
Mar. 31, 2019

* The financial report is exempt from the audit procedures performed by certified public accountants or audit corporations.
* Explanation of appropriate use of earnings forecasts, and other special items
The consolidated financial forecast for the fiscal year ending September 30, 2020 has yet to be determined due to the difficulties ofmaking a reasonable calculation of the forecast due to the COVID-19 pandemic.

―3―

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更新日時:2020/06/09 19:44:31○Contents of Attachments

1. Qualitative Information on Quarterly Consolidated Financial Performance ………………………………………………4(1) Explanation of Results of Operations ………………………………………………………………………………4(2) Explanation of Financial Position ………………………………………………………………………………5(3) Explanation of Consolidated Forecast and Other Forward-looking Statements ………………………………………5
2. Condensed Consolidated Financial Statements and Notes to the Condensed Consolidated Financial Statements………………………………………………6(1) Condensed Consolidated Statement of Financial Position ……………………………………………………………6(2) Condensed Consolidated Statement of Income and Condensed Consolidated Statement of Comprehensive Income……………………………8(3) Condensed Consolidated Statement of Changes in Equity ………………………………………………………………12(4) Condensed Consolidated Statement of Cash Flows ………………………………………………………13(5) Notes to Condensed Consolidated Financial Statements ………………………………………………………15(Notes on going concern assumptions)(Changes in accounting policies)……………………………………………………………………15…………………………………………………………………………………15(Segment information, etc.)……………………………………………………………………………………16(Important subsequent events)………………………………………………………………………………………18―4―

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1. Qualitative Information on Quarterly Consolidated Financial Performance(1) Explanation of Results of Operations
During the first six months of the fiscal year under review, the Japanese economic outlook was uncertain due to the stagnation of
economic activity caused by the COVID-19 pandemic, as well as the trade tensions between the US and China and economic slowdown
in China and Europe seen since the previous fiscal year.
In the travel industry, the number of foreign visitors to Japan in the period from January to March 2020 dropped 51.1% from the same
period of the previous year and the number of Japanese citizens who left Japan in the same period fell 39.6% year on year, according to
the statistics released by the Japan National Tourism Organization (JNTO). These figures reflect the international travel restrictions,
lockdowns and other measures introduced by many countries due to the COVID-19 pandemic as well as the measures taken in Japan,such as stricter quarantine and the invalidation of visas, and travel demand is currently stagnating all over the world. The Company
believes it is necessary to monitor future market trends as well as developments in the COVID-19 pandemic.
Under these conditions, the Company continued expanding its operations by seeking to diversify its service lines with a focus on salesof domestic airline tickets and international airline tickets as an online travel agency and investing in advertising to raise recognition ofits main brand AirTrip. The Company also continued to enhance its services for foreign visitors to Japan, making the most of its online
travel business expertise.
In the IT Offshore Development Business, which was launched in 2012, the Company steadily won customers in numerous businesscategories and increased the number of engineers employed, focusing on the development of lab-type facilities in Vietnam. The numberof engineers hired grew to 1,000 as of the end of December 2019. In the Investment Business, which has been developing in earnest
since the stock was listed, the Company has been investing in growing companies. As of the end of March 2020, the Company has
invested in 64 companies.
In this business environment, during first six months of the fiscal year under review, the Group achieved consolidated net sales of
15,383 million yen, a consolidated operating loss of 660 million yen, a consolidated loss before income taxes of 759 million yen, and aconsolidated loss attributable to owners of parent of 741 million yen.
Operating results by segment are as follows.
(1) Online Travel Agency Business
The Group offers the following five services in the Online Travel Agency Business segment.
・BtoC services (operation of PC and smartphone websites for selling travel commodities directly to general consumers)
The Company implemented measures such as conducting mass marketing, strengthening SEM and overhauling its backbone systems
to acquire new customers and improving user interfaces to increase the number of repeat customers. These contributed to a steadyincrease in the number of service users.
The recognition of the Company’s brand AirTrip increased, and strategic pricing and the active input of branding costs were conductedto acquire customers.
・BtoBtoC services (travel content provision under brands owned by business partners)
The enhanced development of alliances with major partners, the provision of services to match the needs of major partners, andenhanced communication with partners contributed to an increase in service use. In addition, like the BtoC services, measures formarketing and alliances with an emphasis on increasing customer numbers were promoted.
・BTM services (centralized management of internal approval procedures and arrangements associated with corporate business trips)
These services basically adopt a business model under which net sales expand in a manner that is linked with an increase in the numberof corporate customers and a rise in their usage rate. The services achieved growth attributable to initiatives taken by the Group, including
the addition of salespeople and the identification of existing customers who used the services at a relatively low rate.
・Services for foreign visitors (business of providing various BtoC services to visitors to Japan)
The Company offers various services for foreign visitors to Japan, including Wi-Fi rental, camping car rental, currency exchange andweb media serves. In every business line, net sales and income grew steadily due to an increase in visitors to Japan, multilingual customer
service and stronger marketing.
・Life innovation businesses and services―5―

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The Company is leveraging the knowledge of various travel-related services it has built up through its AirTrip brand to launch new
business lines aimed at improving convenience in many different aspects of customers’ lives. Current business lines include e-mailmagazines, the manufacture, sale and rental of travel carry cases, and the tea-processing business, and life innovation businesses andservices are expected to expand significantly in the future with the addition of new services.
As a result of the factors stated above, net sales for the Online Travel Agency Business segment amounted to 14,295 million yen, andsegment income came to 223 million yen in the first six months of the fiscal year under review.
(2) IT Offshore Development BusinessIn the IT Offshore Development Business segment, the Group offers lab-type facility development services to customers consisting
mainly of e-commerce operators, web solution providers, and game and system developers in Ho Chi Minh, Hanoi and Da Nang in
Vietnam.
The Company’s lab-type facility development model is distinctive in that a team is formed with new dedicated staff members hired
for each customer. The model also enables customers to confirm the state of lab-type facility development on demand. The Company
assumes the assignment of dedicated staff members to each team on a medium- to long-term basis. For that reason, the success or failureof development depends on employing workers suited to customer demands and motivating the respective engineers more.
In addition, these services basically adopt a business model under which customers are billed on the basis of man-months and thenumber of workers. The number of engineers supplied to clients and the man-months affect net sales for them significantly. An increasein the number of engineers and a rise in the unit cost due to development streamlining contributed to sales growth in the fiscal year underreview.
As a result of the factors stated above, net sales for the IT Offshore Development Business segment reached 1,016 million yen, andsegment income totaled 53 million yen.
(3) Investment BusinessIn the Investment Business segment, the Group emphasizes synergies with the existing businesses and expands service lines throughaggressive M&A and capital alliances. The Group is pursuing investment in growing companies to improve profitability. At the end of
the second quarter under review, the Group had increased the number of companies in which it invests to .
As a result, net sales for the Investment Business segment stood at 71 million yen, and segment loss was 243 million yen.

(2) Explanation of Financial Position(Assets)
Total assets increased 3,604 million yen from the end of the previous fiscal year, to 34,821 million yen at the end of the second
quarter under review. This result was mainly due to an increase of 4,696 million yen in right-of-use assets and a rise of 1,276 million yen
in inventories, offsetting a decrease of 2,929 million yen in cash and cash equivalents.
(Liabilities)
Liabilities increased 4,098 million yen from the end of the previous fiscal year, to 25,213 million yen at the end of the second quarter
under review. This result primarily reflected increases of 709 million yen in operating payables and other operating payables and 4,808
million yen in lease liabilities, which offset a decrease of 1,822 million yen in other current liabilities.
(Net assets)
Net assets fell 494 million yen from the end of the previous fiscal year, to 9,607 million yen at the end of the second quarter underreview. This result was mainly attributable to a decrease in retained earnings of 775 million yen.

(3) Explanation of Consolidated Forecast and Other Forward-looking Statements
The full-year financial forecast has yet to be determined because the environment surrounding the Company has changed dramatically
due to COVID-19, making it very difficult to forecast the full-year financial results at the present time.

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The Company will carefully assess the impact on its financial results and promptly make an announcement when it is possible to makea reasonable forecast.

―7―

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2. Condensed Consolidated Financial Statements and Notes to the Condensed Consolidated Financial Statements(1) Condensed Consolidated Statement of Financial Position(Millions of yen)
FY9/19(as of Sep. 30, 2019)

Second Quarter of FY9/20(as of March 31, 2020)

AssetsCurrent assets
Cash and cash equivalents
Notes and accounts receivable – tradeand other receivables
Other financial assets

8,997

6,067

5,239

5,437

4,606

4,790

Inventories

428

1,704

Other current assets

868

903

Total current assets

20,14018,903

1,324

1,795

-

4,696

Goodwill

5,861

5,336

Intangible assets

2,501

2,387

Other financial assets

1,103

1,346

Non-current assets
Property, plant and equipment
Right-of-use assets

Other non-current assets

59

40

Deferred tax assets

226

314

11,075

15,917

31,21634,821

4,414

5,123

7,519

7,757

Total non-current assets
Total assets
Liabilities and equity
Liabilities
Current liabilities
Operating payables
operating payables
Interest-bearing debt

and

other

Lease liabilities-

509

Other financial liabilities

368

339

Accrued income taxes

189

203

Other current liabilities

3,224

1,402

Total current liabilities

15,717

15,334

5,111

5,217

Lease liabilities

-

4,299

Other financial liabilities

41

51

Provisions

85

88

Deferred tax liabilities

136

141

Other non-current liabilities

2280

Non-current liabilities
Interest-bearing debt

Total non-current liabilities

5,397

9,878

21,11425,213

Capital stock

2,922

2,934

Capital surplus

4,175

4,478

Retained earnings

Total liabilities
Equity

2,601

1,825

Treasury shares

0

0

Other items of equity
Total equity attributable to owners ofparent

19

22

9,719

9,260

―8―

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Non-controlling interests
Total equity
Total liabilities and equity―9―

更新日時:2020/06/09 19:44:31

382

346

10,101

9,607

31,21634,821

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更新日時:2020/06/09 19:44:31(2) Condensed Consolidated Statement of Income and Condensed Consolidated Statement of Comprehensive Income
Condensed Consolidated Statement of Income
For the First Six-month Period(Millions of yen)Six months ended March 31,
2019(Oct. 1, 2018 – Mar. 31, 2019)

Six months ended March 31,
2020(Oct. 1, 2019 – Mar. 31, 2020)

Net sales

10,643

15,383

Cost of sales△4,735△9,580Gross profit

5,908

5,803

△6,181△6,067264△270

Selling, general and administrative expense
Share of loss (profit) of entities
Other income

220

941

Other expenses△34△1,067

Operating income

178

△660

Finance income

8

11

Finance costs
Profit before income taxes
Corporate income tax

△46
140
11

△110
△759
△19

Profit152△779

Profit (loss) attributable to
Owners of parent

78

△741

Non-controlling interests

74

△38

152

△779

Profit (loss) per share (Yen)

4.31△37.14

Fully diluted profit (loss) per share (Yen)

4.16△37.14

ProfitProfit per share―10―ファイル名:【英語版】第 14 期 2Q 四半期決算短信_20200609194431

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For the Second Quarter Period(Millions of yen)

Net sales

Note

Second quarter of FY9/19(Jan. 1, 2019 – Mar. 31, 2019)

Second quarter of FY9/20(Jan. 1, 2020 – Mar. 31, 2020)

８

5,907

7,402

△2,746△4,560

Cost of sales
Gross profit
Selling, general and administrative expense
Share of loss (profit) of entities

3,161

2,842

△3,158158

Other income

211△2,942△402
81

Other expenses△12△1,040Operating income

361△1,461

Finance income

5

5

△21

△52

Profit before income taxes

345△1,508

Corporate income tax

△42

59

Profit302△1,448280△1,433Finance costs

Profit (loss) attributable to
Owners of parent
Non-controlling interests

22

△15

302

△1,448

Profit (loss) per share (Yen)

15.20△71.29Fully diluted profit (loss) per share (Yen)

14.71△71.29ProfitProfit per share―11―ファイル名:【英語版】第 14 期 2Q 四半期決算短信_20200609194431

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Condensed Consolidated Statement of Comprehensive Income
For the First Six-month Period(Millions of yen)Six months ended March 31,
2019(Oct. 1, 2018 – Mar. 31, 2019)

Six months ended March 31,
2020(Oct. 1, 2019 – Mar. 31, 2020)

152

△779

Items that may be reclassified as profit or loss
Translation adjustments of foreign
operations
Cash flow hedge

△6

△11

△0

△0

Total of items that may be reclassified as profit
or loss△6△11

Total of other comprehensive income, net of tax

△6

△11

Comprehensive income

145

△791

Owners of parent

74

△747

Non-controlling interests

70

△43

ProfitOther comprehensive income, net of tax

Comprehensive income attributable to―12―

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For the Second Quarter Period(Millions of yen)
Second quarter of FY9/19(Jan. 1, 2019 – Mar. 31, 2019)

Second quarter of FY9/20(Jan. 1, 2020 – Mar. 31, 2020)302△1,448Items that may be reclassified as profit or loss
Translation adjustments of foreign
operations
Cash flow hedge

2

△10

0

-

Total of items that may be reclassified as profit
or loss2△10

Total of other comprehensive income, net of tax

2△10

Comprehensive income

305△1,459Comprehensive income attributable to
Owners of parent

281△1,439

24

△20

Note

ProfitOther comprehensive income, net of tax

Non-controlling interests―13―ファイル名:【英語版】第 14 期 2Q 四半期決算短信_20200609194431

更新日時:2020/06/09 19:44:31(3) Condensed Consolidated Statement of Changes in Equity
Six months ended March 31, 2019 (Oct. 1, 2018 – Mar. 31, 2019)(Millions of yen)
Equity attributable to owners of parent
Capital stock Capital surplus
As of October 1, 2018

Retainedearnings

Other items ofequityTreasuryshares

Noncontrolling Total equity
interests

Total

1,100

2,117

1,865

5

-

5,089

380

5,470

Profit (loss)

-

-

78

-

-

78

74

152

Other comprehensive income

-

-

-

△3

-

△3

△3

△6

Total comprehensive income

-

-

78

△3

-

74

70

145

Dividends of surplus

-

△177

-

-

-

△177

-

△177

1,196

1,196

-

-

-

2,393

-

2,393

-

-

-

12

-

12

△3

8

Total transactions with owners

1,196

1,019

-

12

-

2,229

△3

2,225

As of March 31, 2019

2,297

3,137

1,944

14

-

7,393

447

7,841

Issuance of new shares
Increase (decrease) throughtransfers and other changes

Six months ended March 31, 2020 (Oct. 1, 2019 – Mar. 31, 2020)(Millions of yen)
Equity attributable to owners of parent
Capital stock Capital surplus
As of October 1, 2019

Retainedearnings

Other items ofequityTreasuryshares

Noncontrolling Total equity
interests

Total

2,922

4,175

2,601

19

△0

9,719

382

10,101

-

-

△34

-

-

△34

△18

△52

2,922

4,175

2,566

19

△0

9,684

363

10,048

Profit (loss)

-

-

△741

-

-

△741

△38

△779

Other comprehensive income

-

-

-

△5

-

△5

△5

△11

Total comprehensive income

-

-

△741

△5

-

△747

△43

△791

Dividends of surplus

-

△198

-

-

-

△198

-

△198

Issuance of new shares

11

11

-

-

-

23

-

23

-

510

-

-

-

510

-

510

-

△22

-

8

-

△14

26

12

11

302

-

8

-

322

26

349

2,934

4,478

1,825

22

△0

9,260

346

9,607

Adjustment for changes inaccounting policies
Balance after retrospective
restatement

Increase (decrease) by shareexchanges
Increase (decrease) throughtransfers and other changes
Total transactions with owners
As of March 31, 2020―14―

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更新日時:2020/06/09 19:44:31(4) Condensed Consolidated Statement of Cash Flows(Millions of yen)Six months ended March 31,
Six months ended March 31,
2019
2020
(Oct. 1, 2018 – Mar. 31, 2019) (Oct. 1, 2019 – Mar. 31, 2020)
Cash flows from operating activities
Profit (loss) before tax
Depreciation and amortization expense
Investment income (loss)
Negative goodwill
Impairment losses

140
446
△264
△209
-

△759
849
270
△755
1,044

△1,025△1,473

570

256

98
28
△365
77
△489
6
△45
△7
△536

21
△154
△94
68
672
9
△100
△162
△926

△102
△615
△49
82
3

△111
△134
△577
1
51

5

553

△136
15

△150
59

△795

△307

333

△371

Proceeds from long-term loans payable

1,401

-

Repayments of long-term loans payable

△970

△847

Proceeds from issuance of common shares

2,366

-

(Increase) decrease in trade and other receivables
Increase (decrease) in trade and other payables
Decrease (increase) in advance payments - trade
Decrease (increase) in guarantee deposits
Decrease (increase) in investment securities for sale
Other
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of investment securities
Purchase of property, plant and equipment
Purchase of intangible assets
Payments for lease deposits
Collection of lease deposits
Proceeds from withdrawal of time deposits
Proceeds from purchase of shares of subsidiaries
resulting in change in scope of consolidation
Payments for transfer of business
Other
Net cash provided by (used in) investing activities
Cash flows from financing activities
Net increase (decrease) in short-term loans payable

Repayments of lease obligations
Dividends paid to owners of the parent company
Other
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Decrease in cash and cash equivalents resulting fromexclusion of subsidiaries from consolidation
Cash and cash equivalents at end of period

―15―

-

△244

△176

△190

△4

21

2,949

△1,631

△4

3

1,612
5,320

△2,861
8,997

-

△68

6,932

6,067

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更新日時:2020/06/09 19:44:31(5) Notes to Condensed Consolidated Financial Statements(Notes on going concern assumptions)Not applicable.
(Changes in accounting policies)
Application of IFRS 16 Leases
The Group applied IFRS 16 Leases (issued in January 2016) (hereinafter referred to as “IFRS 16”) starting from the first
three months of this consolidated fiscal year. On applying IFRS 16, the Group chose the method of recognizing the
cumulative effect of application of the standard at the date of initial application (October 1, 2019), which is permitted undertransition provisions, and not retrospectively restating comparative information.
(i) Definition of lease
As a result of the application of IFRS 16, at the inception of a contract, the Group assesses whether the contract is, or
contains, a lease. A contract is, or contains, a lease if it conveys the right to control the use of an identified asset for aperiod of time in exchange for consideration.
To assess whether a contract conveys the right to control the use of an identified asset, the Group considers whether acontract includes use of an identified asset, whether the Group has the right to obtain substantially all of the economic
benefits from the use of the asset throughout the period of use, and whether the Group has the right to direct use of theasset.
(ii) Accounting for leases
Leases as lessee
At the commencement of the lease, with respect to the lease components of leases except for short-term leases andlow value asset leases, the Group recognizes a right-of-use asset and the related lease liability. At the commencement
date, the Group measures the right-of-use asset at cost and measures the lease liability at the present value of the lease
payments that are not paid at that date.
The cost of the right-of-use asset consists of the amount of the initial measurement of the lease liability, any initial
direct costs, any lease payments made before the commencement date and other adjustments. The discount rate used todetermine the present value of leases payment is the interest rate implicit in the lease, if that rate can be readily
determined, and if that rate cannot be readily determined, the Group uses the Group’s incremental borrowing rate.
The lease term is the noncancellable period of the lease including the period covered by the option to extend the lease(when the Group is reasonably certain to exercise an option to extend the lease) and the period covered by the option toterminate the lease (when the Group is reasonably certain not to exercise the option to terminate the lease).
After the commencement date, the right-of-use asset is measured at cost less accumulated depreciation andimpairment losses. When depreciating right of use assets, the Group applies the depreciation requirements in IAS 16
Property, Plant and Equipment. The Group also applies IAS 36 Impairment of Assets when assessing whether todepreciate right-of-use assets and when accounting for identified impairment losses.
If the lease transfers ownership of the underlying asset to the Group by the end of the lease term or if the Group isreasonably certain to exercise the lessee’s purchase option, the Group depreciates the right-of-use asset from thecommencement date to the end of the useful life of the underlying asset. Otherwise, the Group depreciates the right-ofuse asset by the straight-line method from the commencement date to the earlier of the end of the useful life of the rightof-use asset or the end of the lease term.
After the commencement date, the Group measures the lease liability by increasing the carrying amount to reflect
interest on the lease liability and reduces the carrying amount to reflect the lease payments made. The Group alsoremeasures the carrying amount to reflect any fluctuation of lease payments or lease modifications or to reflect revised
in-substance fixed lease payments.
The Group expenses lease payments related to short-term leases and low value leases by the straight-line method.

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Accounting on transition
On applying IFRS 16, the Group applies the practical expedient that does not require it to reassess whether existing
contracts contain a lease. Accordingly, assessment of leases in accordance with the definition of a lease under IFRS 16
applies only to contracts concluded or amended on or after October 1, 2019.
Leases as lessee(Leases classified as an operating lease under IAS 17)
A lease liability at transition is measured at present value of the remaining lease payments as of the transition datediscounted at the Group’s incremental borrowing rate as of October 1, 2019. A right-of-use asset at transition ismeasured by one of the methods shown below:
・carrying value as if IFRS 16 had always been in place calculated from lease commencement; provided, however, thatthe discount rate is the lessee’s incremental borrowing rate as of the date of initial application; or・set equal to the lease liability, adjusted for any prepaid or accrued lease payments.
When applying IFRS 16 to leases previously classified as operating leases under IAS 17, the Group applies thepractical expedients shown below:
・apply a single discount rate to a portfolio of leases with reasonably similar characteristics;
・account for leases for which the lease term ends within 12 months of the date of initial application by the same
method used for short-term leases;
・exclude initial direct costs from the measurement of the right-of-use asset as of the date of initial application; and・use hindsight with respect to contracts with options to extend or cancel when determining the lease term, etc.
(Lease classified as a finance lease under IAS 17)
The carrying value of the right-of-use asset and the lease liability is determined based on the carrying value of thelease asset and lease liability under IAS 17 immediately before the date of initial application.
(iii) Impact on the condensed quarterly consolidated financial statements
On application of IFRS 16, in the condensed quarterly consolidated statements of financial position at the beginning of
the period, the Group additionally recognized right-of-use assets of 4,819 million yen and lease liabilities of 4,871 million
yen, and recognized decreased of 34 million yen in retained earnings and 18 million yen in non-controlling interests.
The weighted average of the lessee’s incremental borrowing rates applied to lease liabilities recognized in thecondensed quarterly consolidated statements of financial position as of the date of initial application is 0.7% to 4.8%.
(Segment information, etc.)(1) Summary of reportable segments
The Company’s reportable segments are its business units that have separate financial information available and that are subject
to periodical examinations by the Board of Directors for the purpose of determining the allocation of management resources andevaluating performance.
Under its “One Asia” vision, the Group aims to serve as a bridge connecting various opportunities and engineers in Asia. With
the Online Travel Agency Business, IT Offshore Development Business and Investment Business as its three mainstay businesses,
the Group classifies these businesses, with their highly unique business models, as its main reportable business segments anddraws up and determine Group strategies accordingly.
The businesses and main products belonging to each reportable segment are as follows:
Online Travel Agency Business: AirTrip travel agency services, services for foreign visitors in Japan, life innovation services
IT Offshore Development Business: Lab-type offshore development services and BPO services
Investment Business: Investment in growing companies and turnarounds―17―

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The accounting process for the reportable business segments is the same as that used for the preparation of the condensed
consolidated financial statements.

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更新日時:2020/06/09 19:44:31(3) Information about segment income (loss) and segment performanceSix months ended March 31, 2019 (Oct. 1, 2018 – Mar. 31, 2019)(Millions of yen)
Reportable segments
OnlineIT Offshore
TravelInvestment
Developme
AgencyBusiness
nt BusinessBusiness

Other(Note 1)

Total

Adjustme
Consolidatents
d Total(Note 2)

Total

External sales revenue

9,500

1,142

0

10,6430

10,643-

10,643

Intersegment revenue

32

308

-

341

-

341

△341

-

Total sales revenue

9,533

1,450

0

10,9850

10,985△341

10,643

234

111

237

583

△0

583

△405

178

Segment profits (losses)(Note 3)Financial income

8

Financial expenses△46

Income before income
140
taxes
(Note 1) The category “Other” includes the business segments not included in the reportable segments, such as advertising revenue.
(Note 2) The category “Adjustments” mainly consists of corporate expenses that do not belong to any reportable segment andintersegment transactions.
(Note 3) The segment profit or loss has been adjusted to the operating income stated in the condensed quarterly consolidated
statement of income.
Six months ended March 31, 2020 (Oct. 1, 2019 – Mar. 31, 2020)(Millions of yen)
Reportable segments
OnlineIT Offshore
TravelInvestment
Developme
AgencyBusiness
nt BusinessBusiness

Other(Note 1)

Total

Adjustme
Consolidatents
d Total(Note 2)

Total

External sales revenue

14,295

1,016

71

15,3830

15,383-

15,383

Intersegment revenue

-

425

-

425

-

425

△425

-

14,2951,441

71

15,808015,808△425

15,383

198

53

△243

9

△0

9

△669

△660

Total sales revenue
Segment profits (losses)(Note 3)Financial income

11

Financial expenses△110

Income before income
△759
taxes
(Note 1) The category “Other” includes the business segments not included in the reportable segments, such as advertising revenue.
(Note 2) The category “Adjustments” mainly consists of corporate expenses that do not belong to any reportable segment andintersegment transactions.
(Note 3) The segment profit or loss has been adjusted to the operating income stated in the condensed quarterly consolidated
statement of income.

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Second quarter ended March 31, 2019 (Jan. 1, 2019 – Mar. 31, 2019)(Millions of yen)
Reportable segments
OnlineIT Offshore
TravelInvestment
Developme
AgencyBusiness
nt BusinessBusiness

Total

Other
(Note 1)

Total

Adjustme
Consolidatents
d Total(Note 2)External sales revenue

5,376

531

0

5,907

0

5,907

-

5,907

Intersegment revenue

16

200

-

216

-

216

△216

-

Total sales revenue

5,392

731

0

6,124

0

6,124

△216

5,907

430

20

140

591

△0

591

△230

361

Segment profits (losses)(Note 3)Financial income

5

Financial expenses△21

Income before income
345
taxes
(Note 1) The category “Other” includes the business segments not included in the reportable segments, such as advertising revenue.
(Note 2) The category “Adjustments” mainly consists of corporate expenses that do not belong to any reportable segment andintersegment transactions.
(Note 3) The segment profit or loss has been adjusted to the operating income stated in the condensed quarterly consolidated
statement of income.
Second quarter ended March 31, 2020 (Jan. 1, 2020 – Mar. 31, 2020)(Millions of yen)
Reportable segments
OnlineIT Offshore
TravelInvestment
Developme
AgencyBusiness
nt BusinessBusiness

Total

Other
(Note 1)

Total

Adjustme
Consolidatents
d Total(Note 2)External sales revenue

6,893

508

0

7,402

0

7,402

-

7,402

Intersegment revenue

-

209

-

209

-

209

△209

-

Total sales revenue

6,893

718

0

7,612

0

7,612

△209

7,402

Segment profits (losses)(Note 3)

△707

13

△406

△1,100△0△1,100△360△1,461

Financial income

5

Financial expenses△52

Income before income△1,508taxes(Note 1) The category “Other” includes the business segments not included in the reportable segments, such as advertising revenue.
(Note 2) The category “Adjustments” mainly consists of corporate expenses that do not belong to any reportable segment andintersegment transactions.
(Note 3) The segment profit or loss has been adjusted to the operating income stated in the condensed quarterly consolidated
statement of income.
(Important subsequent events)
Not applicable.

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