Summary of Consolidated Financial Results (Japanese Accounting Standards)
for the First Quarter of the Fiscal Year Ending December 31, 2018
May 15, 2018
Company name: AOI TYO Holdings Inc.
Stock Exchange: Tokyo Stock Exchange
Code:3975
URL:
http://aoityo.com/en/
Representatives: Yasuhito Nakae, Representative Director
Inquiries:
Satoshi Yuzurihara, Executive Director
Scheduled date of submission of quarterly report:
May 15, 2018
Scheduled date of commencement of dividend payment:－Supplementary documents for quarterly results:
Yes
Quarterly results briefing:
NoTel: +81-3-3779-8415(Rounded down to the nearest million yen)

1. Consolidated Financial Results for the First Quarter (from January 1, 2018 to March 31, 2018)(1) Consolidated operating results
Net sales(The percentages are year-on-year changes.)
Profit attributable toOrdinary income
owners of parent

Operating income

Million yen%

Million yen%

Million yen

Q1 FY201815,521-16.0
1,092-40.0
Q1 FY201718,472‒
1,820‒(Note) Comprehensive income
Q1 FY2018: 866 million yen (-15.0%)
Diluted net income
Net income per shareper shareYen

Million yen%

1,031-41.98421,776‒1,016Q1 FY2017: 1,019 million yen (‒%)

%

-17.0
‒

Yen

Q1 FY2018
35.38
34.94
Q1 FY2017
42.92
42.22
(Note) No year-on-year change is stated for Q1 FY2017 because AOI TYO Holdings was established on January 4, 2017.

(2) Consolidated financial position
Total assets

Net assets

Million yen

Q1 FY2018
FY2017(For reference) Shareholders’ equity

Equity ratio

Million yen%

58,351
26,12359,73725,706Q1 FY2018: 25,011 million yen

42.9
41.3
FY2017: 24,675 million yen

2. Dividends
Dividends per share
End of Q1

End of Q2

End of Q3

Year end

AnnualYen

YenYenYenYen

FY2017

‒

8.00

‒

22.00

30.00

FY2018‒FY2018 (forecast)
8.00(Note) Revisions to dividends forecast published most recently: No‒

22.00

30.00

3. Consolidated Financial Results Forecast for FY2018 (from January 1, 2018 to December 31, 2018)
Net sales
Million yen

Operating income%Million yen(The percentages are year-on-year changes.)
Profit attributable toNet income per shareowners of parent

Ordinary income%First half
35,0003.8
2,000-15.2
Full year
70,000-0.7
3,800-17.7(Note) Revisions to earnings forecast published most recently: NoMillion yen%

Million yen%

Yen

1,900
3,700

-17.6
-15.8

1,300
2,300

9.2
-17.3

54.73
96.83

* Notes(1) Important changes in subsidiaries for the first quarter under review (Changes is specified subsidiaries resulting inchange in scope of consolidation):
NoNew: ‒ companies
Excluded: ‒ companies(2) Application of accounting treatment specific to the preparation of quarterly consolidated financial statements:
Not applicable(3) Changes in accounting policies, and changes or restatements of accounting estimates(i) Changes in accounting policies due to revisions to accounting standards etc.: Not applicable(ii) Changes in accounting policies other than (i):Not applicable(iii) Changes in accounting estimates:
Not applicable(iv) Restatements of accounting estimates:
Not applicable(4) Number of issued shares (common stock)(i) Number of issued shares (including treasury stock)
Q1FY2018
24,566,447 shares
FY2017(ii) Number of treasury stock at end of period
Q1FY2018
730,195 shares
FY2017(iii) Average number of issued shares
Q1FY2018
23,826,837 shares
Q1 FY2017

24,566,447 shares
745,627 shares
23,672,830 shares(Note) The number of treasury stock includes the 274,500 shares that Trust & Custody Services Bank, Ltd. (trust account E) holds
as trust property related to a Board Benefit Trust system.

* This summary of quarterly financial results is not included in the scope of the quarterly review.
* Explanation on the proper use of results forecasts and other notes- The forward-looking statements, including results forecasts, in this document are based on information that AOI TYOHoldings has obtained at the time of publication and certain assumptions that it believes to be reasonable. Actual results
may differ materially from the forecasts due to a variety of reasons. For the assumptions of results forecasts and noteson the use of results forecasts, please refer to 1. Qualitative Information on Results in the First Quarter, (3) Discussionof consolidated results forecasts on page two of the Accompanying Materials.

Contents of Accompanying Materials
1. Qualitative Information on Results in the First Quarter ...................................................................................... 2(1) Discussion of operating results ...................................................................................................................... 2(2) Discussion of financial position .................................................................................................................... 2(3) Discussion of consolidated results forecasts .................................................................................................. 2
2. Quarterly Consolidated Financial Statements and Major Notes .......................................................................... 3(1) Quarterly consolidated balance sheets ........................................................................................................... 3(2) Quarterly consolidated statements of income and statements of comprehensive income .............................. 5(3) Notes to quarterly consolidated financial statements ..................................................................................... 7(Notes on the premise of a going concern) .................................................................................................... 7(Notes if there is a considerable change to shareholders’ equity) .................................................................. 7(Significant subsequent events) ................................................................................................................... 7

1. Qualitative Information on Results in the First Quarter(1) Discussion of operating results
The forward-looking statements below are based on AOI TYO Group’s judgments at the end of the first quarter under review.
The Japanese economy continued to recover moderately during the first quarter under review. Corporate earnings and employment
conditions improved. Consumer spending showed signs of recovery. Meanwhile, downside risks caused by factors such as uncertainty
overseas remained evident.
AOI TYO Holdings Inc. and its consolidated subsidiaries (hereinafter the “AOI TYO Group”) defines its mission as a <emotion
creation company> by crossing borders between media and linking companies and consumers through <emotion>, and creating<emotion> that will touch people’s hearts and encourage them to take action. AOI TYO Group sees advertising video production
business as its mainstay, and is promoting operations with the aim of sustainable growth and improving corporate value as a group,
considering both the solution business which offers solutions to customers including direct transactions with advertisers as well as
video content marketing, and Overseas Business as its strategic areas.
In this environment, consolidated net sales decreased in the first quarter under review, reflecting factors such as the close inspection
and selection of orders based on a profitability-oriented operation in the core Advertising Video Production Business, order controls forpromoting working style reforms and a decline in sales of printing(*). Meanwhile, margins associated with video production improved
as a result of strict cost controls which began in the previous fiscal year. In the strategic area of offering solutions to customers throughdirect transactions with advertisers, net sales expanded due to an increase in the number of new customers. Net sales rose for theOverseas Business, too, reflecting factors, including the acquisition of an advertising production firm in Malaysia. However, advance
expenses that arose in connection with actions, such as the establishment of a new subsidiary, had an adverse impact on consolidated
profits.
The backlog of orders increased 5.1% year on year, to 14,985 million yen at the end of the first quarter under review, and the ordersituation has been steady, with a carryover of some of the orders to the following quarter.
As a result, AOI TYO Group posted net sales of 15,521 million yen (decreased 16.0% year on year), operating income of 1,092 million
yen (decreased 40.0% year on year), ordinary income of 1,031 million yen (decreased 41.9% year on year), and profit attributable toowners of parent of 842 million yen (decreased 17.0% year on year). Selling, general and administrative expenses include amortizationof goodwill of 80 million yen associated with M&A.
* Television commercial materials have been delivered to broadcasting stations in printed format, and therefore sales and profit
associated with the printing have been recognized. Such sales and profits are expected to decline in stages because online datatransmission (delivery without duplication) became possible in October 2017.
AOI TYO Group has two reporting segments: Advertising Business and Video-Related Business. Because the Video Related Businessaccounts for only a small percentage of its overall results and is not very important as disclosure information, it does not state segment
information.

(2) Discussion of financial position
Total assets at the end of the first quarter under review decreased by 1,386 million yen compared with the end of FY 2017 to 58,351
million yen. The primary cause was that although work in process increased by 1,219 million yen, electronically recorded monetaryclaims - operating decreased by 1,587 million yen, notes and accounts receivable - trade decreased by 946 million yen, and landdecreased by 679 million yen, respectively.
Liabilities decreased by 1,803 million yen compared with the end of FY 2017 to 32,228 million yen. The primary cause was that
although advances received increased by 1,028 million yen, short-term loans payable decreased by 1,083 million yen, accounts payable- trade decreased by 567 million yen, and income taxes payable decreased by 444 million yen, respectively.
Net assets increased by 417 million yen compared with the end of FY 2017 to 26,123 million yen. The primary cause was that althoughretained earnings decreased by 530 million yen due to the payment of dividends, net assets increased by 842 million yen due torecording profit attributable to owners of parent.

(3) Discussion of consolidated results forecasts
There are no changes to the consolidated results forecast for the first half and full year of the fiscal year ending December 31, 2018
announced on February 14, 2018.

2. Quarterly Consolidated Financial Statements and Major Notes(1) Quarterly consolidated balance sheets(Unit: thousand yen)
FY2017(December 31,2017)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Electronically recorded monetary claims - operating
Merchandise and finished goods
Work in process
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Land
Other
Total property, plant and equipment
Intangible assets
Software
Software in progress
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Lease and guarantee deposits
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Accounts payable - trade
Short-term loans payable
Current portion of long-term loans payable
Advances received
Income taxes payable
Provision for bonuses
Other
Total current liabilities
Non-current liabilities
Long-term loans payable
Long-term deposits received
Provision for directors' retirement benefits
Provision for management board incentive plan trust
Net defined benefit liability
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities

Q1 FY2018(March 31, 2018)12,573,956
17,813,558
6,208,110
16,1283,629,657
1,297,266-35,271
41,503,406

12,044,054
16,867,406
4,620,308
15,6584,849,034
1,374,248-42,62239,728,087

4,289,822
3,390,024
7,679,846

3,610,349
3,557,130
7,167,480

171,168
975,504
4,106,706
15,7235,269,103

190,751
1,182,254
4,275,303
15,853
5,664,162

2,787,996
1,318,377
1,255,572-76,430
5,285,515
18,234,466
59,737,872

2,995,119
1,431,981
1,440,396-75,701
5,791,795
18,623,438
58,351,526

7,341,915
10,443,335
2,329,624
758,125
1,175,623
82,2983,144,339
25,275,262

6,774,389
9,359,987
2,213,386
1,787,063
730,908
94,5942,872,819
23,833,148

3,465,280
3,501,199
285,345
105,832
248,570
355,935
794,392
8,756,557
34,031,819

3,136,360
3,501,199
277,165
112,009
255,511400,196
712,455
8,394,898
32,228,046

(Unit: thousand yen)
FY2017(December 31,2017)
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury sharesTotal shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Subscription rights to shares
Non-controlling interests
Total net assets
Total liabilities and net assets

Q1 FY2018(March 31, 2018)

5,000,000
12,074,353
7,823,773-711,360
24,186,766

5,000,000
12,077,975
8,135,867-697,729
24,516,114

444,466
42,391
1,884
488,742
140,824889,719
25,706,052
59,737,872495,285-1,5772,151
495,860
138,376
973,128
26,123,479
58,351,526

(2) Quarterly consolidated statements of income and statements of comprehensive income
Quarterly consolidated statements of income
Consolidated first quarter

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Share of profit of entities accounted for using equity method
Other
Total non-operating income
Non-operating expenses
Interest expenses
Commission fee
Share of loss of entities accounted for using equity method
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Gain on step acquisitions
Other
Total extraordinary income
Extraordinary losses
Loss on valuation of membership
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

Q1 FY2017(January 1, 2017 －March 31, 2017)18,472,525
14,350,594
4,121,930
2,301,164
1,820,765(Unit: thousand yen)
Q1 FY2018(January 1, 2018 －March 31, 2018)15,521,703
12,319,963
3,201,739
2,109,491
1,092,247

3,956
4,614
7,139
29,962
45,671

3,031
9,902
－
23,28336,217

20,532
40,838－28,56889,9391,776,498

21,032
39,97823,234
12,651
96,897
1,031,567－
17,85911,732823
30,415385,099－－216
385,315

1,900
1,900
1,805,013
686,935
85,134772,070
1,032,943
16,884
1,016,058－－
1,416,883
496,898
55,694
552,593864,290
21,403842,886

Quarterly consolidated comprehensive statements of income
Consolidated first quarter

ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities accounted for using equity
methodTotal other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests

Q1 FY2017(January 1, 2017 －March 31, 2017)
1,032,943(Unit: thousand yen)
Q1 FY2018(January 1, 2018 －March 31, 2018)864,290-5,290-7,093-131

50,819-28,587266-13,352
1,019,590

2,424
866,715

1,005,261
14,328850,096
16,618-837-20,073

(3) Notes to quarterly consolidated financial statements(Notes on the premise of a going concern)
Not applicable(Notes if there is a considerable change to shareholders’ equity)
Not applicable(Significant subsequent events)
At its Board of Directors meeting on May 15, 2018, AOI TYO Holdings resolved to dispose of treasury shares by means of third-party
allotment with the introduction of “board benefit trust (BBT)”, a performance-based stock awards system (hereinafter the “System”)
announced in a timely disclosure dated February 27, 2018 titled “Notice of the Introduction of the Performance-Based Stock Awards
System”(only in Japanese language). Details are as follows.
1. Summary for the disposal(1) Disposal dateThursday, May 31, 2018

(2) Number of shares to be disposed of

144,400 shares of common stock(3) Disposal value

1,606 yen per share(4) Total disposal value

231,906,400 yen(5) Party to obtain shares to be disposed of

Trust & Custody Services Bank, Ltd. (Trust E Account )(6) Other matters

The disposal of treasury shares is subject tothe effectiveness of the registration statement under
Instruments and Exchange Act.

the Financial

2. Purposes and reasons for the disposal
For the purpose of owning and disposing of its shares for operating the System, AOI TYO Holdings will dispose of treasury shares bymeans of third party allotment to Trust E Account of Mizuho Trust & Banking Co., Ltd., a trustee of Trust & Custody Services Bank,Ltd. (a trust AOI Pro. Inc. established on September 1, 2015 (hereinafter the “trust before succession”)) through the disposal oftreasury shares stated above by third party allotment.
AOI TYO Holdings plans to establish the trust on the disposal date in way to be transferred the contractual status of a trust or of thetrust before succession.