Translation
July 31, 2018

Consolidated Financial Results
for the First Quarter of the Fiscal Year Ending March 31, 2019
<under Japanese GAAP>
Company name:
Listing:
Stock code:
URL:
Representative:
Contact:

Yamato Holdings Co., Ltd.
Tokyo Stock Exchange9064
http://www.yamato-hd.co.jp/
Masaki Yamauchi, President
Kenichi Shibasaki, Director, in charge of Financing and Accounting
Tel: +81-3-3541-4141 (from overseas)
Scheduled date of the submission of quarterly securities report:
August 14, 2018
Scheduled date of the commencement of dividend payment:—
Preparation of supplementary materials on quarterly financial results:
Yes
Holding of quarterly financial results meeting:Yes(Amounts less than 1 million yen are discarded.)1.

Consolidated financial results for the first quarter of fiscal year 2019
(cumulative: from April 1, 2018 to June 30, 2018)(1) Consolidated operating results

For the three months ended
June 30, 2018
June 30, 2017
(Note) Comprehensive income:(Percentages indicate year-on-year changes.)
Profit attributable toOperating revenue
Operating profit
Ordinary profit
owners of parent
Millions of yen% Millions of yen% Millions of yen% Millions of yen%
380,690
7.1
9,578
—
9,429
—
2,638
—
355,478
4.0(10,000)—(9,582)—(7,937)—For the three months ended June 30, 2018: 2,486 million yen (—%)
For the three months ended June 30, 2017: (7,007) million yen (—%)
Basic earnings per share

For the three months ended
June 30, 2018
June 30, 2017

Diluted earnings
per shareYen
6.69(20.13)Yen——(2) Consolidated financial position
Total assets
Net assets
Equity ratio
As ofMillions of yen
Millions of yen%
June 30, 2018
1,114,870
554,410
49.1
March 31, 2018
1,114,870
557,586
49.4(Reference) Equity:
As of June 30, 2018: 547,038 million yen
As of March 31, 2018: 550,307 million yen(Note) The Group has applied the “Partial Amendments to Accounting Standard for Tax Effect Accounting” (ASBJ Statement No. 28, February
16, 2018) and relevant Guidances effective from the beginning of the first quarter of the fiscal year ending March 31, 2019. The figures
presented for the consolidated financial position for the previous fiscal year reflect amounts that have been adjusted retrospectively toreflect the aforementioned standard, etc.

2.

Dividends
First quarter
Yen——

Second quarter
Yen
13.00

Fiscal 2018
Fiscal 2019
Fiscal 2019 (Forecast)
14.00(Note) Revisions to the forecasts most recently announced: None

Annual dividends
Third quarter
Yen—

Fiscal year-end
Yen
14.00

—

14.00

Total
Yen
27.00
28.00

3.

Consolidated earnings forecasts for fiscal year 2019 (from April 1, 2018 to March 31, 2019)
Operating revenue

Operating profit

Millions of yen%
Millions of yen%
Half year
780,000
6.9
15,000—
Full year
1,615,000
5.0
61,00070.9(Note) Revisions to the forecasts most recently announced: Yes(Percentages indicate year-on-year changes.)
Basic
Profit attributable toOrdinary profit
earnings
owners of parent
per share
Millions of yen%
Millions of yen%
Yen
15,000
—
9,000
—
22.83
61,00069.0
36,00097.5
91.31* Notes(1) Changes in significant subsidiaries during the three months under review (changes in specified subsidiaries
resulting in the change in scope of consolidation): None
(2) Application of specific accounting for preparing the quarterly consolidated financial statements: Yes(Note) For details, please see “2. Consolidated Financial Statements and Significant Notes Thereto, (3) Notes to consolidated financial
statements, (Application of specific accounting for preparing the quarterly consolidated financial statements)” of the attached materials
to the quarterly financial results report on page 13.

(3) Changes in accounting policies, changes in accounting estimates, and restatementa. Changes due to revision to accounting standards, etc.: Noneb. Changes other than a:
Nonec. Changes in accounting estimates:
None
d. Restatement:
None(4) Number of issued shares (common shares)
a. Number of issued shares as of the end of the period (including treasury shares)
As of June 30, 2018:
411,339,992 shares
As of March 31, 2018:
411,339,992 sharesb. Number of treasury shares as of the end of the period
As of June 30, 2018:
17,064,434 shares
As of March 31, 2018:
17,064,197 sharesc. Average number of shares during the period (cumulative from the beginning of the fiscal year)
For the three months ended June 30, 2018:394,275,707 shares
For the three months ended June 30, 2017:394,277,367 shares*Quarterly financial results reports are exempt from quarterly review conducted by certified public accountants or an
audit corporation.
*Proper use of earnings forecasts and other noteworthy events• Descriptions of the above financial projections and other data are based on information currently available to the Company and certain
assumptions that we consider to be reasonable. Actual financial results may differ significantly from the projections for various reasons. For
points to note when using such assumptions and financial projections, please see “1. Qualitative Information on Settlement of Accounts for
the Three Months, (3) Explanation of consolidated earnings forecasts and other forward-looking statements” of the attached materials to thequarterly financial results report on page 8.
• The Company plans to post supplementary materials on quarterly financial results on the Company’s website promptly after theannouncement of the quarterly financial results.

Attached Materials
Index

1. Qualitative Information on Settlement of Accounts for the Three Months................................................................. 2(1) Explanation of operating results ........................................................................................................................ 2(2) Explanation of financial position ........................................................................................................................ 8(3) Explanation of consolidated earnings forecasts and other forward-looking statements .................................... 8
2. Consolidated Financial Statements and Significant Notes Thereto .......................................................................... 9(1) Consolidated balance sheet .............................................................................................................................. 9(2) Consolidated statement of income and consolidated statement of comprehensive income ............................ 11
Consolidated statement of income (cumulative) .............................................................................................. 11
Consolidated statement of comprehensive income (cumulative)..................................................................... 12(3) Notes to consolidated financial statements ..................................................................................................... 13(Notes to premise of going concern)................................................................................................................ 13(Notes on significant changes in the amount of shareholders’ equity) ............................................................. 13(Changes in scope of consolidation and equity method application) ............................................................... 13(Application of specific accounting for preparing the quarterly consolidated financial statements) ................. 13(Additional information).................................................................................................................................... 13(Segment information, etc.) ............................................................................................................................. 13
3. Supplementary Information .................................................................................................................................... 15
Operating revenue by business ................................................................................................................................ 15-1-

1. Qualitative Information on Settlement of Accounts for the Three Months(1) Explanation of operating results
During the three months ended June 30, 2018, the economic environment was plagued by ongoing
uncertainties ahead due to factors that have included effects of political developments overseas, yet gradualeconomic recovery held course amid underlying strengths in corporate earnings. Moreover, the logistics
industry continues to face a severe business environment partially due to tightening of the domestic labormarket, which is in addition to an upward trend with respect to small parcel volume partially due to expansion of
the e-commerce market brought about by rapidly changing styles of consumption.
Under such circumstances, the Yamato Group has been striving to enhance its management foundations inorder to continue achieving sustainable growth and thereby enable the Group to keep providing high-quality
services based on “KAIKAKU 2019 for NEXT100” medium-term management plan, which while “reforming
working styles” is centered on management, focuses on reforms in the three areas of “structural reform in the
Delivery Business,” “reform of revenue and business structure geared to achieving discrete growth,” and“reform of Group management structure geared to achieving sustainable growth.”
In the Delivery Business, we promoted our initiatives to rebuild our ‘last mile’ network that include adequate
pricing initiatives and enhancement of collection and delivery systems to live up to the trust and expectations ofcustomers in order to strike a balance between regaining profitability and expanding collection and delivery
capacity. As a result, our financial performance was firm due to rise in TA-Q-BIN unit price, despite increasing
expenses related to our reform initiatives.
In the non-delivery businesses, we continuously took steps to expand our existing service offerings by enlisting
the strengths of Group companies, while also drawing on Group-wide ties as we aggressively promoted
solution sales geared toward addressing customers’ business challenges.
Our consolidated financial results for the three months ended June 30, 2018 are as follows.
(Millions of yen)
Item
Operating revenue
Operating profit
Ordinary profit
Profit attributable toowners of parent

For the three months
ended June 30, 2017
355,478(10,000)(9,582)For the three months
ended June 30, 2018
380,690
9,578
9,429

(7,937)2,638

ChangeGrowth (%)

25,212
19,57919,012

7.1——

10,576—

As mentioned above, operating revenue amounted to 380,690 million yen, up 25,212 million yen from theyear-ago period. This is largely attributable to an increase in the TA-Q-BIN unit price, and despite a decrease in
TA-Q-BIN delivery volume amid promotion of structural reforms in the Delivery Business. Operating expenses
amounted to 371,112 million yen, up 5,632 million yen from the year-ago period. This is largely attributable toan increase in personnel expenses incurred in promoting systemic improvements and other initiatives, anddespite a decrease in commission expenses associated with lower TA-Q-BIN delivery volume.
As a result, operating profit amounted to 9,578 million yen, up 19,579 million yen from the year-ago period.
Meanwhile, due to a situation where Yamato Home Convenience Co., Ltd. was found to have inappropriately
billed our corporate clients for moving services, the above consolidated financial results factor in an estimatedeffect of the incident amounting to 3,104 million yen, based on investigation results.
Initiatives for the entire Yamato Groupa.

The Yamato Group has been taking steps on a Group-wide basis to develop an upbeat working
environment, which is more “employee-friendly” and “rewarding,” centered on the “Office for Reforming
Working Styles” established in Yamato Transport Co., Ltd., and its “Working Styles Innovation
Committees” in its respective Group companies, as a means of placing utmost priority on “reforming
working styles” in order to practice “inclusive management,” a Yamato Group founding principle. Moreover,
we have been pursuing our “Value Networking” design, on the basis of creating business models forgenerating a high level of added value through the combined efforts of our respective businesses, while at

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b.

c.

d.

e.

the same time contributing to growth strategies and international competitive strengths of the Japanese
economy. Meanwhile, we are also taking steps to forge a robust corporate culture that acts as a foundation
for business creation and development.
We continued to drive initiatives geared toward forging a more robust corporate culture. To that end, we
worked on enhancing the efficiency and dependability of operations, in part by improving our transportsystems and by using our information technology network to enable visual monitoring of operating
volumes. Moreover, we actively engaged in CSR-related activities linked to Yamato Group businessendeavors, such as through safety and environmental measures, and efforts to prosper communities.
To further evolve our “Value Networking” design, we have been crafting business models that deliver ahigh level of added value by leveraging the Yamato Group’s business network. Also, to address variedcustomer needs in Japan and overseas, we will make more effective use of our innovative network
platform consisting of the “Haneda Chronogate,” “Okinawa International Logistics Hub,” and respective
gateways linking major cities in the Kanto, Chubu, and Kansai regions, in addition to our existing “last mile”
network.
In our business looking toward global markets, we have been working to forge collaboration among five
regions, Japan, East Asia, South East Asia, Europe and the Americas, while strengthening our capabilities
in each geographic region to respond to the growth of cross-border logistics. During the three months
ended June 30, 2018, we have been promoting efforts to build cross-border networks that provide
substantial added value primarily focusing on our cold chain network. In part, this has involved newly
acquiring in Thailand certification under international standards pertaining to small parcel chilled andfrozen goods delivery services, such that has already been acquired by seven Yamato Group companies.
With the aim of improving customer convenience particularly in the e-commerce market, we have been
continuously working to establish an environment that ensures customers ease in picking up their parcels.
To that end we have been actively promoting efforts to build an open-type network of parcel lockers
primarily in train stations, convenience stores and other such locations, and have worked on other efforts
for the development of next-generation logistics services including the utilization of automated driving
technologies. Moreover, we have been taking steps that involve digitization and automation of our overalllogistics operations in order to address challenges presented by society such as the labor shortage as it
intensifies, and in order to better serve the rapidly expanding e-commerce market.

Summary of each operating segment

 Delivery
The delivery volumes of TA-Q-BIN and Kuroneko DM-Bin services are as follows.
(Million parcels / units)
Category
TA-Q-BIN
Kuroneko DM-Bin

a.
b.

c.

For the three months
ended June 30, 2017
450
384

For the three months
ended June 30, 2018
418
339

ChangeGrowth (%)
(32)
(44)

(7.2)
(11.6)In the Delivery Business, the Yamato Group concentrated on TA-Q-BIN-centered business development,
aiming to provide infrastructure that best suits our customers and contribute to enriching people’s lives.
Amid a severe business environment partially due to tightening of the domestic labor market, which is inaddition to an upward trend with respect to small parcel volume partially due to expansion of the
e-commerce market brought about by rapidly changing styles of consumption, during the three months
ended June 30, 2018, continuing on from the prior fiscal year, we promoted our initiatives to rebuild our‘last mile’ network that include adequate pricing initiatives and enhancement of collection and delivery
systems to live up to the trust and expectations of customers in order to strike a balance between
regaining profitability and expanding collection and delivery capacity. In addition, we also engaged inefforts geared to structural reform of trunk-route networks for the purposes of further streamlining
transportation and optimizing the entire network.
In the still growing e-commerce market, we have been taking steps to expand sales of the “TA-Q-BIN
Compact” and “Nekopos” services which enable customers to send small parcels simply, and proceededwith offering a greater number of drop-off points for sending by collaborating with multiple flea market
websites. During the three months ended June 30, 2018, we continued to team up with e-commercecompanies in offering a service environment where customers who have purchased a product are able to

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d.

e.

f.

specify either a business office of Yamato Transport Co., Ltd., a convenience store or an open-type parcel
locker (PUDO) as a location for pick-up, while also promoting use of our “Kuroneko Members” service forindividual customers.
With respect to corporate clients, we have been accurately pinpointing managerial challenges and actively
proposing solutions to address those challenges. Moreover, we have been working to boost profitability bymaking proposals that provide high added value using the Group’s business resources. During the threemonths ended June 30, 2018, we continued our efforts to support business of e-commerce companies
through initiatives that included upgrading the website of our “Yamato Business Members” service forcorporate clients and accordingly enhancing features that provide greater convenience.
We have been taking steps to improve services for residents geared toward resolving issues facing
communities. In part, this has involved collaborating with numerous municipalities and companies in efforts
that entail helping those who have difficulties doing their shopping and helping to watch over elderly
residents. Moreover, we have also been helping to revitalize local industry particularly through initiatives
that involve supporting tourism and helping to expand sales channels for locally produced products.
Operating revenue amounted to 299,175 million yen, up 9.4% from the year-ago period owing to a higher
TA-Q-BIN unit price as a result of promotion of structural reforms in the Delivery Business, despite adecrease in TA-Q-BIN delivery volume. Amid increasing expenses related to our reform initiatives,operating profit amounted to 6,186 million yen, an improvement of 23,466 million yen from the year-ago
period.

 BIZ-Logistics
a.

b.

c.
d.

In the BIZ-Logistics Business, the Yamato Group is providing customers with innovative logistics systems
by combining management resources such as the TA-Q-BIN network with logistics functions, maintenanceand recall handling functions, cleansing functions for medical devices and international transportation
functions.
For the e-commerce industry and others, we are offering one-stop services for various types of logisticalsupport services in line with customer needs, including placing and accepting orders, visual monitoring of
inventories for customers and enabling speedier shipments. During the three months ended June 30, 2018,use of this service continued to increase particularly among our existing customers.
For medical service providers, we have been developing medical device loaner support (storage, cleaningand delivery) and other services that help revolutionize logistics operations. During the three months
ended June 30, 2018, use of this service increased particularly among our existing large-lot customers.
Operating revenue amounted to 37,071 million yen, up 8.0% from the year-ago period mainly due tofavorable results from existing services for e-commerce business operators, and progress made inproviding industry-specific solutions. Operating profit amounted to 1,118 million yen, down 38.7% from theyear-ago period mainly as a result of having incurred upfront expenses to achieve business growth.

 Home Convenience
a.
b.

c.
d.

In the Home Convenience Business, we are working toward enabling customers to achieve greater
convenience and comfort in their lives through lifetime lifestyle support businesses and corporate
enterprise support business that draw on the Yamato Group’s nationwide network.
With respect to individual customers, the Yamato Group operated a variety of services to assist in daily life
such as the “Raku Raku Household TA-Q-BIN” service for delivering large furniture items and home
appliances, moving-related services and “Comfortable Lifestyle Support Service” which aims to help
customers resolve everyday inconveniences “inside the home.” During the three months ended June 30,
2018, we continued to take steps to achieve greater business volume with respect to our “Raku Raku
Household TA-Q-BIN” service that makes it easy for customers to send large packages by linking up withflea market website, and we also aggressively forged ahead with efforts to increase sales of our“Comfortable Lifestyle Support Service.”
For our corporate clients, we have been developing services such as those involving equipment transportand event-related deliveries. During the three months ended June 30, 2018, we continued our efforts togain orders for office relocations and other such business.
Operating revenue amounted to 9,114 million yen, down 22.9% from the year-ago period, despite having
achieved favorable results with respect to operating the “Raku Raku Household TA-Q-BIN” service and the“Comfortable Lifestyle Support Service.” The decrease was a result of having factored in an estimated-4-effect amounting to 3,104 million yen, based on investigation results with respect to a situation involving
inappropriate billing for moving-related services provided to corporate clients. As for profits, the segment
posted an operating loss of 3,005 million yen as a result of having factored in the aforementioned
estimated effect of 3,104 million yen, in addition to having incurred higher labor costs, including those ofoutsourcing workforce, associated with promoting our focus on reforming working styles.

 e-Business
a.

b.

c.

In the e-Business, the Yamato Group helps customers streamline their business processes and solve
potential issues by proactively developing solution platform business that combine logistics technology andfinancial technology with information technology. In addition, with the aim of helping to accelerate growthof Yamato Group businesses, we have been moving beyond conventional information technologies
through efforts geared to promoting use of emerging technologies that harness artificial intelligence (AI),the Internet of things (IoT) and other such innovations.
With respect to services for assisting with order-acceptance and dispatching operations, the YamatoGroup provides a “Web-based Shipment Control” that comprehensively supports such operations as
dispatch information processing, printing of delivery slips, and freight tracking. During the three months
ended June 30, 2018, use of this service increased particularly among our existing large-lot customers,
against a backdrop that included growth of e-commerce market and reuse market.
Operating revenue amounted to 6,220 million yen, down 8.2% from the year-ago period mainly due toeffects of a decrease in the number of projects involving system processing for customers stemming froma decrease in TA-Q-BIN delivery volume, and despite having achieved a greater volume of business in the“Web-based Shipment Control” and having captured system configuration business as a result ofenhanced sales activities for our existing customers. Operating profit amounted to 1,951 million yen, up
9.0% from the year-ago period mainly due to firm results with respect to use of our highly profitable
existing services.

 Financial
a.
b.

c.

d.

In the Financial Business, the Yamato Group has been developing settlement and financial services
tailored to a range of customer needs for payment collection of mail-order products, business-to-business
transaction settlement, and vehicle leasing.
With respect to our payment settlement services, in addition to providing our mainstay service “TA-Q-BIN
Collect,” we have also been promoting increased customer use of both our “Kuroneko Web Collect”
comprehensive internet-based transaction settlement service, “Kuroneko Pay After Delivery Services” andour e-money settlement services. During the three months ended June 30, 2018, we promoted use of our“Raku-uru Cart” service, which is poised for expansion going forward. This service helps business
operators newly enter the e-commerce market by providing one-stop support in terms of shopping cartfunction, payment settlement and delivery services. Moreover, we focused on improving our service
offerings in part by launching our ID-linked “Kuroneko Pay” service that links “Kuroneko Member”
information with purchases to promote greater convenience to customers who use online shopping andincreased sales for e-commerce companies.
In the lease services business, we have been generating favorable results with respect to financial leases
primarily involving trucks and installment sales. We have also been developing peripheral operations that
include providing vehicle referrals and resale support, while forging ahead in making proposals involving
total solutions related to vehicles.
Operating revenue amounted to 19,820 million yen, down 3.7% from the year-ago period mainly due to adecrease in “TA-Q-BIN Collect” delivery volume largely stemming from a shrinking market for
cash-on-delivery brought about by changing payment settlement needs, and despite increases in the useof our “Kuroneko Web Collect” and “Kuroneko Pay After Delivery Services.” Operating profit was 1,710
million yen, down 16.2% from the year-ago period.

 Autoworksa.

In the Autoworks Business, the Yamato Group provides its 24-hour-a-day, 365-day-a-year service thatenables customers to service their vehicles without stopping operation, which involves carrying out

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b.

c.
d.

periodic maintenance under a membership framework, thereby providing value to logistics operations
providers in the form of “improvement of vehicle maintenance convenience” and “maintenance expense
reduction.” Furthermore, we provide services that help our customers improve their asset utilization ratios,by adding options of “maintaining and safeguarding logistics facilities and equipment, and improving such
workplace environments,” along with “offering insurance plans tailored to customer risk management
needs” which provide coverage for such assets.
In vehicle maintenance services, we have embarked on efforts to handle new areas of business,particularly those that involve providing support for reducing workloads of sales drivers and ensuring safe
vehicle operation, as well as carrying out inspections and maintenance of small electric trucks with lower
exhaust emissions and large electric buses that are being put to use in tourism destinations.
During the three months ended June 30, 2018, having assumed ownership of the vehicle maintenanceplant facilities of a large-lot customer, we have been taking steps to achieve greater business volume
particularly with respect to fully taking on vehicle maintenance going forward.
Operating revenue amounted to 6,051 million yen, down 1.0% from the year-ago period largely as a resultof sluggish sales of vehicle equipment. Operating profit was 1,249 million yen, up 5.8% from the year-ago
period mainly due to progress made in streamlining business processes, particularly in terms ofstandardizing and enabling visual monitoring of business operations by introducing production methods ofmanufacturers.

 Othera.

b.

The “JITBOX Charter service” provides transportation by transport box. The service takes advantage of its
network consisting of multiple companies and provides added value to customers through timely delivery
and frequent, right-volume delivery. In the three months ended June 30, 2018, service use grew steadily
due to favorable results with respect to existing services.
Operating profit excluding dividends which Yamato Holdings Co., Ltd. received from the Group companies
decreased 23.1% from the year-ago period to 252 million yen.

CSR Initiatives
a.

b.

c.

d.

The Yamato Group places utmost priority on protecting human life and conducts a range of safetymeasures. During the three months ended June 30, 2018, the entire Yamato Group including its overseas
operations carried out the “Zero Traffic Accidents Campaign” in efforts to heighten safety awareness on aGroup-wide basis. In addition, since 1998 we have been holding our “Safety Classes for Children,” throughwhich we convey the importance of traffic safety, in day care facilities, kindergartens and elementary
schools across Japan. A total of about 3.00 million people have now participated.
The Yamato Group works to ensure that its distribution mechanisms are environmentally sound, under its
policy of “Nekology” (combining “Kuroneko” with “ecology”) for promoting its environmental conservation
initiatives. We also hold “Kuroneko Yamato Environmental Class” sessions designed to provide support forenvironmental education of children who will bear responsibilities of the next generation. We have heldsuch classes on an ongoing basis nationwide since 2005, attracting about 240 thousand participants so
far.
Aspiring to be a company that continually evolves in step with society, led by Yamato Welfare Foundation,
the Yamato Group conducts various activities to help realize a society in which disabled people can freely
enjoy a lifestyle as a member of the workforce. Specifically, we engage in ongoing programs that support
economic independence of people with disabilities, such that include actively employing people withdisabilities at the Swan Bakery which makes and sells bread, providing them with workplaces through theconsigned delivery of Kuroneko DM-Bin, and operating job-finding support facilities where they take part intraining to acquire skills and knowledge necessary for employment.
Aiming to create more sustainable social value, the Yamato Group promotes initiatives for sharing value
with society based on “Creating Shared Value (CSV).” During the three months ended June 30, 2018, we
have been promoting our “combined passenger-cargo” operations using scheduled-route passenger buses
and railways in the ten geographic regions of Iwate prefecture, Miyazaki prefecture, Hokkaido, Kumamoto
prefecture, Hyogo prefecture, Nagano prefecture, Wakayama prefecture, Tokushima prefecture, Aichi
prefecture and Gifu prefecture thereby helping to improve lifestyle services for local residents both bykeeping scheduled bus and railway networks running in hilly and mountainous areas where populations

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e.

are substantially declining and getting older, and also by streamlining distribution in those locations. In
April, we also initiated “combined passenger-cargo” as tourism-support operations in Oita prefecture,
which involve delivering luggage belonging to tourists using Airport Limousine Bus transportation to their
lodging facilities. In addition, for residents of suburban housing complexes which are undergoing changes
with respect to people’s life stages, we have been providing support for community development geared toensuring that local residents are able to lead comfortable lives. Our efforts have involved helping torevitalize local communities where we have our business locations, and providing such residents withlifestyle support services that include handling shopping and housekeeping on their behalf. Moreover, wehave been engaging in efforts geared to revitalizing communities and resolving issues by leveraging the
Yamato Group’s management resources, with respect to initiatives that include helping to watch overelderly residents, supporting tourism, and expanding sales channels for locally produced products in
respective regions throughout Japan. As a result, we have worked with government bodies on a total of
2,096 such endeavors thus far, which includes 834 current initiatives that are now being implemented orunder discussion.
In order to earn the confidence of Yamato Group’s customers and society through acting as a company
that forms an important part of social infrastructure, we have been promoting management in conformity
with compliance and working on Group-wide initiatives with respect to “reforming working styles” throughdeveloping upbeat working environment which is more “employee-friendly” and “rewarding” for employees,
such as promoting reviewing our management rules on working hours and creating new working styles forour employees.

-7-(2) Explanation of financial position
The Group has applied the “Partial Amendments to Accounting Standard for Tax Effect Accounting” (ASBJ
Statement No. 28, February 16, 2018) and relevant Guidances effective from the beginning of the first quarterof the fiscal year ending March 31, 2019. Accordingly, analysis and comparison of the Group’s financial position
against the fiscal year ended March 31, 2018, has been performed on the basis of figures calculated upon
retrospective application of such accounting standards and other relevant guidance.
Total assets were 1,114,870 million yen as of June 30, 2018, which does not constitute a significant change
from the end of the previous fiscal year. Breaking this change down, the major factors were increases in notes
and accounts receivable - trade of 5,113 million yen, property, plant and equipment of 4,490 million yen andincome taxes receivable of 4,105 million yen, despite a decrease of 16,123 million yen in cash and deposits.
Liabilities increased 3,176 million yen to 560,459million yen from the end of the previous fiscal year. The
increase was largely attributable to a 50,390 million yen increase in accrued expenses upon having recognizedscheduled payments of summer bonuses, despite decreases in short-term loans payable of 24,483 million yen
and provision for bonuses of 18,871 million yen.
Total net assets were 554,410 million yen, down 3,176 million yen from the end of the previous fiscal year. Thiswas mainly attributable to a decrease in retained earnings of 2,881 million yen due to the payment of dividendsof surplus of 5,519 million yen and recording of profit attributable to owners of parent of 2,638 million yen.
Accordingly, the equity ratio changed to 49.1% from the previous fiscal year’s 49.4%.
(3) Explanation of consolidated earnings forecasts and other forward-looking statements
Going forward, the economic situation is likely to remain one that is plagued by ongoing uncertainties ahead
due to factors such as effects of political developments overseas, despite the prospect of gradual economic
recovery holding course amid underlying strengths in corporate earnings.
The severe business environment affecting the logistics industry is likely to persist amid factors that include
further tightening of the domestic labor market, amid a continued upward trend with respect to small parcel
volume brought about by rapidly changing styles of consumption and other such trends.
In that environment, the Yamato Group’s efforts in the Delivery Business will involve striking a balance between
regaining profitability and expanding collection and delivery capacity, which will entail promoting initiatives torebuild its “last mile” network including adequate pricing initiatives and enhancement of its collection anddelivery systems. Also in the non-delivery businesses, we will expand our revenue base which will involve
taking steps to expand our existing service offerings by enlisting the strengths of Group companies, while also
drawing on Group-wide ties in promoting solution sales geared toward addressing customers’ businesschallenges.
As for expenditures, we will focus on controlling outsourcing costs amid the likelihood of rising personnel
expenses primarily with respect to employee salaries incurred in process of promoting our “reforming working
styles” initiatives.
Meanwhile, the situation where Yamato Home Convenience Co., Ltd. (YHC) inappropriately billed corporateclients for moving-related services is being taken very seriously. We intend to formulate drastic measures toprevent any such instances for occurring again in the future, and have accordingly taken action that includes
establishing an “promotion office for business structure reform” directly under the control of YHC’s president,
establishing an in-house investigative committee consisting of independent experts from outside the company,
and carrying out a fact-finding investigation and probe pertaining to the incident. YHC will refrain from making
new contracts with corporate clients for moving-related services and taking new orders in that regard until
reoccurrence preventive measures that the investigative committee deems effective are initiated. The effect of
this has been reflected in the consolidated earnings forecasts.
The Yamato Group has made changes to the consolidated earnings forecasts for the half year and for the fullyear of the fiscal year ending March 31, 2019 since the announcement made on May 1, 2018.

-8-

2. Consolidated Financial Statements and Significant Notes Thereto(1) Consolidated balance sheet(Millions of yen)
As of March 31, 2018

As of June 30, 2018

AssetsCurrent assets
Cash and deposits

204,422

188,298

Notes and accounts receivable - trade

224,099229,212

Accounts receivable - installment

46,69247,726

Lease investment assets

52,64153,064Merchandise and finished goods

749

661

Work in process

146

207

Raw materials and supplies

1,919

1,766

Other

30,32835,893

Allowance for doubtful accounts(1,365)(1,293)

Total current assets

559,635

555,537

336,986

337,702

Accumulated depreciation(198,538)(199,140)

Buildings and structures, net

138,447

138,561

Non-current assets
Property, plant and equipment
Buildings and structures

Vehicles

197,587

201,177(180,329)(180,752)

17,257

20,424Land

174,959

174,762

Lease assets

15,66914,596

Accumulated depreciation(9,074)(8,699)Lease assets, net

6,595

5,897

173,144

176,404(105,347)(106,502)

Accumulated depreciation
Vehicles, net

Other
Accumulated depreciation
Other, net

67,797

69,902405,057

409,548

20,131

19,497

Investment securities

59,841

60,526

Other

71,25170,743

Allowance for doubtful accounts

(920)

(856)

Allowance for investment loss

(126)

(126)

130,045

130,287555,235

559,333

1,114,870

1,114,870

Total property, plant and equipment
Intangible assets
Investments and other assets

Total investments and other assets
Total non-current assets
Total assets-9-

(Millions of yen)
As of March 31, 2018

As of June 30, 2018

Liabilities
Current liabilities
Notes and accounts payable - trade155,323

149,325

Short-term loans payable

66,952

42,469Current portion of bonds

10,00010,000

Lease obligations

2,239

2,186

Income taxes payable

11,019

7,081

Deferred installment income

5,900

5,846

Provision for bonuses

33,20814,337

Other

110,390

166,117

Total current liabilities

395,035

397,363

Bonds payable

10,00010,000Long-term loans payable

60,30060,300

Lease obligations

3,548

3,220

Net defined benefit liability

75,49575,977

Other

12,903

13,597

Total non-current liabilities

162,247

163,096557,283

560,459

Capital stock

127,234

127,234

Capital surplus

36,81336,813Retained earnings

416,854

413,973

Treasury shares(39,081)(39,082)

Total shareholders’ equity

541,821538,939

Valuation difference on available-for-sale securities

12,95813,898Foreign currency translation adjustment

1,146

167

Remeasurements of defined benefit plans(5,618)(5,967)

Total accumulated other comprehensive income

8,486

8,098

7,279

7,372

Non-current liabilities

Total liabilities
Net assets
Shareholders’ equity

Accumulated other comprehensive income

Non-controlling interests
Total net assets
Total liabilities and net assets- 10 -

557,586

554,410

1,114,870

1,114,870

(2) Consolidated statement of income and consolidated statement of comprehensive income
Consolidated statement of income (cumulative)(Millions of yen)
For the three months ended
June 30, 2017

For the three months ended
June 30, 2018

Operating revenue

355,478

380,690

Operating cost

353,118

358,649

Operating gross profit

2,359

22,041

Selling, general and administrative expenses

12,36012,462

Operating profit (loss)(10,000)

9,578

Non-operating income
Interest income

36

33

Dividend income

587

376

Other

335

285

Total non-operating income

959

695

Interest expenses

76

60

Share of loss of entities accounted for using equity method

317

468

Other

146

315

Total non-operating expenses

541

844

(9,582)

9,429

Gain on sales of non-current assets

1390Gain on sales of investment securities—

37

Total extraordinary income

139

37

Loss on retirement of non-current assets

24

56

Impairment Loss—

820

Loss on valuation of investment securities

—

0

Other

—

0

Total extraordinary loss

24

877

Profit (loss) before income taxes(9,467)

8,589

Income taxes(1,595)

5,879

Profit (loss)

Non-operating expenses

Ordinary profit (loss)
Extraordinary income

Extraordinary loss

(7,871)

2,709

Profit attributable to non-controlling interests

66

71

Profit (loss) attributable to owners of parent(7,937)2,638- 11 -

Consolidated statement of comprehensive income (cumulative)(Millions of yen)
For the three months ended
June 30, 2017

For the three months ended
June 30, 2018

(7,871)

2,709

Valuation difference on available-for-sale securities

1,238

1,104

Foreign currency translation adjustment

(779)

(978)

Remeasurements of defined benefit plans, net of tax

404

(349)

0

(0)

864

(223)

(7,007)2,486

Comprehensive income attributable to owners of parent(7,311)

2,251

Comprehensive income attributable to non-controllinginterests

304

235

Profit (loss)
Other comprehensive income

Share of other comprehensive income of entities accounted
for using equity method
Total other comprehensive income
Comprehensive income(Breakdown)- 12 -

(3) Notes to consolidated financial statements(Notes to premise of going concern)
Not applicable.
(Notes on significant changes in the amount of shareholders’ equity)
Not applicable.
(Changes in scope of consolidation and equity method application)
Material changes in scope of consolidation
Yamato Multi-Maintenance Solutions Co., Ltd. is excluded from the scope of consolidation effective from thefirst quarter ended June 30, 2018, because it ceases to exist upon absorption-type merger having been carriedout with Yamato Logistics Co., Ltd., the surviving company.
(Application of specific accounting for preparing the quarterly consolidated financial statements)
Calculation of tax expenses
Tax expenses are calculated by multiplying the profit before income taxes by the reasonably estimated effective
tax rates after the application of tax effect accounting to the profit before income taxes for the fiscal year
including the first quarter under review.
(Additional information)
Application of “Partial Amendments to Accounting Standard for Tax Effect Accounting” and relevant Guidances
The Group has applied the “Partial Amendments to Accounting Standard for Tax Effect Accounting” (ASBJ
Statement No. 28, February 16, 2018) and relevant Guidances effective from the beginning of the first quarterof the fiscal year ending March 31, 2019. Accordingly, deferred tax assets were presented under “Investments
and other assets” and deferred tax liabilities were presented under “Non-current liabilities.”(Segment information, etc.)[Segment information]
1. Information regarding the amounts of operating revenue and profit or loss by reportable segment
For the three months ended June 30, 2017
(Millions of yen)
BIZ-Logistics

Home
Convenience

e-Business

Financial

273,360

34,313

11,816

6,777

20,582

16,986

3,388

2,967

9,191

795

290,347(17,280)

37,702
1,823

14,784230

15,9691,789

21,3772,040

Reconciliation(Note 3)

Amountrecorded inconsolidated
statement ofincome(Note 4)

DeliveryOperating revenue(1) Operating revenue from customers(2) Inter-segment operating revenue ortransfers
Total
Segment profit (loss)

Autoworks

Other(Notes 1, 2)

Total

Operating revenue(1) Operating revenue from customers
6,113
2,513
355,478—355,478(2) Inter-segment operating revenue or
7,562
24,18765,079(65,079)—
transfers
Total
13,67526,700420,557(65,079)
355,478
Segment profit (loss)
1,181
17,157
6,943(16,944)(10,000)
Notes: 1. Other includes business-to-business distribution via JITBOX Charter and shared services.
2. Operating revenue in Other includes dividends which the Company received from the Group companies as a pure holding
company and the effect of this on operating revenue and segment profit is 17,482 million yen.
3. The adjustment of segment profit resulted from eliminating transactions among segments, etc.
4. We made an adjustment between segment profit and operating loss in the consolidated statement of income.

- 13 -

For the three months ended June 30, 2018
(Millions of yen)
BIZ-Logistics(Note 1)

Home
Convenience(Note 1)e-Business(Note 1)

Financial

299,175

37,071

9,114

6,220

19,82016,771

2,975

2,854

9,633

736

315,947
6,186

40,046
1,118

11,968(3,005)15,854
1,951

20,556
1,710

Reconciliation(Note 4)

Amountrecorded inconsolidated
statement ofincome(Note 5)

DeliveryOperating revenue(1) Operating revenue from customers(2) Inter-segment operating revenue ortransfers
Total
Segment profit (loss)

Autoworks

Other(Notes 2, 3)

Total

Operating revenue(1) Operating revenue from customers
6,051
3,236
380,690—
380,690(2) Inter-segment operating revenue or
8,127
25,414
66,513(66,513)—transfers
Total
14,17928,651
447,204(66,513)
380,690
Segment profit (loss)
1,249
18,607
27,818(18,239)
9,578
Notes: 1. Effective from the first quarter ended June 30, 2018, changes have been made to reportable segments for certain businesses as aresult of organizational restructuring being carried out to reform organizational structures and innovate the management system
under the “KAIKAKU 2019 for NEXT100” medium-term management plan. As the principal points of change, the TechnicalNetwork business, which was previously included in Home Convenience, the e-Logistics solution business, e-On Demandsolutions business, and Setup and Logistics solutions business, which previously were included in e-Business, are now includedin BIZ-Logistics. The segment information for the three months ended June 30, 2017 has been prepared and presented according
to the new classification.
2. Other includes business-to-business distribution via JITBOX Charter and shared services.
3. Operating revenue in Other includes dividends which the Company received from the Group companies as a pure holding
company and the effect of this on operating revenue and segment profit is 18,593 million yen.
4. The adjustment of segment profit resulted from eliminating transactions among segments, etc.
5. We made an adjustment between segment profit and operating profit in the consolidated statement of income.

2. Information regarding impairment losses of non-current assets or goodwill, etc. by reportable segment(Significant impairment loss on non-current assets)
In the Home Convenience segment, the Company has decreased the book value of an asset group withdiminished profitability to the recoverable value, and has accordingly recorded an impairment loss of 820
million yen for the three months ended June 30, 2018.

- 14 -

3. Supplementary Information
Operating revenue by business
For the three months ended For the three months ended
Fiscal year ended
June 30, 2017
June 30, 2018
March 31, 2018
ChangeBusiness segment(%)
AmountRatio
AmountRatio
AmountRatio(Millions of yen)(%)
(Millions of yen)(%)
(Millions of yen)(%)
TA-Q-BIN
247,74869.7
274,260
72.0
10.7
1,099,341
71.4
Kuroneko DM-Bin
21,3696.0
19,814
5.2(7.3)
82,542
5.4
Express
10,202
2.9
10,1882.7(0.1)
42,456
2.8
Delivery
Others25,085
7.1
24,8626.5(0.9)
102,881
6.7
Eliminations(31,045)(8.7)(29,950)
(7.9)
(3.5)
(125,453)
(8.2)
Total
273,360
76.9
299,17578.6
9.4
1,201,769
78.1
Trading logistics service
9,211
2.6
10,252
2.7
11.3
39,075
2.5
Sales and Logistics
11,083
3.1
10,6792.8(3.6)
46,4933.0
Multi maintenance
3,324
0.9
4,235
1.1
27.4
15,5861.0
Products Logistics
1,191
0.3
1,319
0.3
10.7
4,797
0.3
BIZ-Logistics Technical Network*
1,124
0.3
427
0.1
(62.0)
4,428
0.3
e-Logistics solution*
2,834
0.8
2,867
0.8
1.2
12,381
0.8
Others*13,2793.7
14,3843.8
8.3
54,516
3.5
Eliminations(7,735)(2.2)(7,095)(1.9)(8.3)(31,663)
(2.1)
Total
34,313
9.7
37,0719.7
8.0
145,6149.5
Home convenience
11,157
3.1
8,460
2.2
(24.2)
41,938
2.7
Business convenience
3,632
1.0
3,513
0.9
(3.3)
16,396
1.1
HomeConvenience Eliminations(2,973)(0.8)(2,859)(0.8)(3.8)(13,467)
(0.9)
Total
11,816
3.3
9,114
2.4
(22.9)
44,8682.9
Credit card solution
2,411
0.7
2,177
0.6
(9.7)
9,733
0.6
IT operating
1,760
0.5
1,695
0.4
(3.7)
6,971
0.5
Web-based mail order
1,253
0.4
1,287
0.3
2.7
5,433
0.4
solution
e-Business
Others*
11,6803.3
12,692
3.3
8.7
47,248
3.1
Eliminations(10,328)(2.9)(11,632)(3.1)
12.6(42,549)
(2.8)
Total
6,777
1.9
6,220
1.6
(8.2)
26,837
1.7
Payment
9,078
2.6
7,847
2.1
(13.6)
34,883
2.3
Lease
9,976
2.8
10,0602.6
0.8
40,498
2.6
Credit & Finance
897
0.3
870
0.2
(3.0)
3,768
0.2
Financial
Others
1,444
0.4
1,791
0.5
24.1
6,785
0.4
Eliminations
(813)
(0.2)
(749)
(0.2)
(7.8)
(2,979)(0.2)
Total
20,582
5.8
19,8205.2(3.7)
82,956
5.4
Truck solution
12,262
3.4
12,666
3.3
3.3
48,768
3.2
Others
2,053
0.6
2,165
0.6
5.5
8,868
0.6
Autoworks
Eliminations(8,202)(2.3)(8,780)(2.3)
7.0(32,994)
(2.1)
Total
6,113
1.7
6,051
1.6
(1.0)
24,641
1.6
JITBOX Charter service
2,158
0.6
2,818
0.7
30.6
10,467
0.7
Others26,136
7.4
27,514
7.2
5.3
48,935
3.2
Other
Eliminations(25,780)(7.3)(27,096)(7.1)
5.1(47,277)
(3.1)
Total
2,513
0.7
3,236
0.9
28.8
12,1250.8
Total
355,478
100.0
380,690
100.0
7.1
1,538,813
100.0* Effective from the first quarter ended June 30, 2018, changes have been made to reportable segments for certain businesses as a result oforganizational restructuring being carried out to reform organizational structures and innovate the management system under the“KAIKAKU 2019 for NEXT100” medium-term management plan. The principal changes are shown below. The segment information for
the three months ended June 30, 2017 and the fiscal year ended March 31, 2018 have been restated to reflect the new classification.
• The Technical Network business that belonged to Home Convenience is included in BIZ-Logistics.
• e-Logistics solution business that belonged to e-Business is presented in BIZ-Logistics, e-On Demand solutions business and Setup
and Logistics solutions business that belonged to other in e-Business is presented in other in BIZ-Logistics.

- 15 -