Summary of Consolidated Financial Results (Japanese Accounting Standards)
for the First Quarter of the Fiscal Year Ending December 31, 2020

May 19, 2020

Company name:
AOI TYO Holdings Inc.
Stock Exchange:
Tokyo Stock Exchange
Code:3975
URL:
http://aoityo.com/en/
Representatives:
Yasuhito Nakae, Representative DirectorInquiries:
Satoshi Yuzurihara, Executive Director Tel: +81-3-3779-8415
Scheduled date of submission of quarterly report:
May 19, 2020
Scheduled date of commencement of dividend payment:
Supplementary documents for quarterly results:
Yes
Quarterly results briefing:
No(Rounded down to the nearest million yen)

1. Consolidated Financial Results for the First Quarter (from January 1, 2020 to March 31, 2020)(1) Consolidated operating results(The percentages are year-on-year changes.)
Net sales
Q1 FY2020
Q1 FY2019(Note) Comprehensive income

Operating income

Million yen%

13,04915,470-15.7-0.3

Million yen%

116633Q1 FY2020: -226 million yen (-%)

Ordinary income

-81.6
-42.0

5564%

Million yen

-99.1
-45.3

-32263%－-68.7Q1 FY2019: 356million yen (-58.8%)

Net income per share

Diluted net income�per shareYen

Yen

Q1 FY2020
Q1 FY2019

Million yen

Profit attributable toowners of parent

-1.40
11.20

－
11.15

(2) Consolidated financial position
Total assets

Net assets

Million yen

Q1 FY20
FY201952,34953,352(For reference) Shareholders’ equity

Equity ratio

Million yen%

22,84923,363Q1 FY2020: 22,433 million yen

42.9
43.0

FY2019: 22,935 million yen

2. Dividends
Dividends per share
End of Q1
Yen

End of Q2
Yen

End of Q3

FY20198.00－FY2020－FY2020 (forecast)
8.00(Note) Revisions to dividends forecast published most recently: NoYen

Year end

AnnualYen

Yen－12.00

20.00

－

12.00

20.00

3. Consolidated Financial Forecast for FY2020 (January 1, 2020 to December 31, 2020)
The consolidated forecast for the fiscal year ending December 31, 2020 has not been determined as it is difficult tomake a reasonable calculation. We will promptly announce the earnings forecast when it becomes possible to calculate it.

* Notes(1) Important changes in subsidiaries for the first quarter under review (Changes is specified subsidiaries resulting inchange in scope of consolidation):No
New: ― 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)
Q1 FY2020(ii)

Q1 FY201924,566,447 shares

Q1 FY2019

1,109,564 shares

Q1 FY2019

23,553,340 shares

Number of treasury stock at end of period
Q1 FY2020(iii)

24,566,447 shares
1,100,062 shares

Average number of issued shares
Q1 FY2020

23,456,609 shares(Note)The number of treasury stock includes the 418,900 shares that Trust & Custody Services Bank, Ltd. (trust account E)
holds as trust property related to a Board Benefit Trust system.
* This summary of financial results is not subject to review by a certified public accountant or certified public
accounting firm.
* 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 AOITYO Holdings 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 more about assumptions
underlying earnings forecasts and cautions regarding the use of earnings forecasts, see 1. Qualitative Information
on Results (3) Description of Information on Outlook on P.3 of Attachments.

Attachments
1. Qualitative Information on Results in the First Quarter(1) Description of Results of Operations(2) Description of Financial Position(3) Description of Information on Outlook
2. Quarterly Consolidated Financial Statements and Major Notes(1) Quarterly consolidated balance sheets(2) Quarterly consolidated statements of income and statements of comprehensive income(3) Notes to Quarterly Consolidated Financial Statements(Notes on the premise of a going concern)(Notes in the event of significant changes in shareholders’ equity)―1―2223446888

1. Qualitative Information on Results in the First Quarter(1) Discussion of operating results
Any forward-looking statements below are based on AOI TYO Group judgments as of the end of the first quarter of thecurrent consolidated fiscal year.
During the consolidated first quarter, the spread of COVID-19 caused a dramatic global slowdown in economicactivities. The Japanese economy saw a sharp decline in inbound demand, as well as temporary business closures andshortened hours of operations across a wide variety of businesses beginning in March in conjunction with voluntary
restraints on non-essential travel outside the home. This and other factors have pushed the Japanese economy into asignificant decline.
The AOI TYO Group began implementing anti-infection measures in the middle of February, canceling or postponing
travel to Asia, including travel for filming. In late February, we restricted meetings to 20 or fewer people and limited
domestic and international business trips (any trips required the approval of a director). Responding to the government’s
request to cancel events and the declaration of emergency in Hokkaido, we implemented a complete ban on domestic andinternational business trips. As film production falls under the Three C’s (avoid closed, crowded, close-contact spaces),
we have adopted measures to change production details and limit the scope of production in the planning stages. In lateMarch, we began asking advertising agencies and advertisers to postpone filming.
Under these circumstances, the AOI TYO Group recorded net sales of ¥13,049 million, ¥2,421 million lower than thesame period in the prior fiscal year. This performance reflected delays in filming and editing of video advertisingproduction projects from major advertising agencies, cancellations and postponements of events in our advertisementrelated business, and the drop-off in sales from underperforming subsidiaries that we restructured in the prior fiscal year.
Of this decrease in sales, we can identify ¥1,850 million related to postponements or cancellations of projects due toCOVID-19. On the other hand, order backlog for the consolidated first quarter amounted to ¥16,910 million, up ¥998
million year on year.
Sales declines had a significant impact on profits. Operating profit, ordinary profit, and profit all underperformed year onyear, despite having recorded impairment loss related to software and costs related to restructuring at poorly performing
subsidiaries in the prior year.
As a result, the AOI TYO Group recorded net sales of ¥13,049 million for the consolidated first quarter, representing a
15.7% decrease compared to year-ago quarter. Operating profit amounted to ¥116 million (81.6% decreases), while
ordinary profit amounted to ¥5 million representing decreases of 99.1%, and loss attributable to owners of parent
amounted to ¥32 million (¥263 million of profit attributable to owners of parent in the same period of prior fiscal year).
Selling, general and administrative expenses included ¥85 million in amortization of goodwill associated with M&Aactivity.

(2) Discussion of financial position
Total assets as of the end of the consolidated first quarter amounted to ¥52,349 million, a ¥1,002 million decrease
compared to the end of the prior consolidated fiscal year. This decrease was mainly due to a decrease in notes andaccounts receivable of 3,277 million yen, compared to increases in work in process of ¥1,514 million and electronicallyrecorded monetary claims of ¥697 million.
Liabilities decreased by 487 million yen compared with the end of the prior fiscal year to 29,500 million yen. Although
short-term loans payable increased ¥2,300 million, accounts payable and long-term loans payable decreased ¥1,431
million and ¥742 million, respectively.
Net assets amounted to ¥22,849 million, a decrease of ¥514 million compared to the end of the prior consolidated fiscalyear, mainly due to decrease in retained earnings of ¥286 million by dividend payments.

―2―(3) Discussion of consolidated results forecasts
As stated in the Notice Regarding Delay of Consolidated Financial Results Announcement for the First Quarter of theFiscal Year Ending December 2020 and Revision to Second Quarter and Full-year Consolidated Performance Forecast
on April 28, 2020, the AOI TYO Group has retracted its forecasts announced on February 19, 2020, and has not yetdetermined its forecasts for the first half and full year of the fiscal year ending December 31, 2020.
① Response to and Impact of COVID-19
AOI TYO Group is strengthening our response to prevent the spread of COVID-19. For the time being, we are
requiring employees to work from home as a rule and restricting access to our physical facilities. Placing the highest
priority on the safety and health of our business partners and employees, as well as to respond to social demand forpreventing the spread of COVID-19, we have asked those involved in filming and editing advertising production projects
that require interactions between two or more people to postpone their work.
Even if the declaration of emergency is lifted in the future, measures are still likely to be required to prevent the spreadof COVID-19. The degree of such requirements has not been clarified at this time, so it is difficult to determine the extent
to which the AOI TYO Group and our video and event production operations will be affected. Even in such a situation,
we are adopting planning and production methods that avoid the Three C’s (closed spaces, crowded spaces, close contact)
to minimize the risk of infection. We are also talking with advertising agencies and advertisers, continuing advertisingcommunications activities as appropriate while ensuring production set safety.
Furthermore, the stagnation of economic activity caused by COVID-19 may exacerbate the economic situation anddampen corporate earnings in Japan and overseas, resulting in lower demand for advertising. However, it is difficult toprovide a rational calculation of this impact on orders for group services at this time.
Our consolidated cash and deposits as of March 2020 amounted to ¥9,142 million and we maintain a high current ratioof 188.7%. Besides, we have closed commitment lines with a number of financial institutions for a combined ¥12 billion(¥3.2 billion outstanding as of March 2020). We also plan to secure long-term loans during the second quarter of fiscal
2020 to ensure sufficient liquidity.
② Future Outlook
Given the current situation, we will continue leave our results forecast undecided until we are able to calculate
projections, at which point we will make an announcement.

―3―2. Quarterly Consolidated Financial Statements and Major Notes(1) Quarterly consolidated balance sheets(Unit: thousand yen)
FY 2019(December 31, 2019)

Q1 FY2020(March 31, 2020)

AssetsCurrent assets
Cash and deposits

9,111,122

9,142,175

Notes and accounts receivable - trade16,873,97813,596,093

Electronically recorded monetary claims - operating

4,413,564

5,110,573

7,301

7,202

Work in process

4,510,288

6,024,878

Other

1,125,296

1,261,056

Allowance for doubtful accounts(37,727)

36,003,823(38,536)

35,103,442Land

3,606,822

3,593,652

Other

3,477,826

3,377,906

Total property, plant and equipment

7,084,649

6,971,559

Software161,589234,213

Goodwill

4,010,215

3,911,018

103,479

15,9944,275,284

4,161,225

Investment securities

1,787,051

1,514,978Deferred tax assets

1,328,303

1,521,338

Lease and guarantee deposits

1,522,658

1,535,995

Other

2,125,874

2,307,360

Allowance for doubtful accounts(775,409)

5,988,478(766,195)

Total non-current assets

17,348,413

17,246,262

Total assets

53,352,237

52,349,704

Merchandise and finished goods

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

Intangible assets

Other
Total intangible assets
Investments and other assets

Total investments and other assets―4―

6,113,477

(Unit: thousand yen)
FY 2019(December 31, 2019)

Q1 FY2020(March 31, 2020)

Liabilities
Current liabilities
Accounts payable - trade

8,697,200

7,265,565

Short-term loans payable

3,200,000

5,500,000

Current portion of long-term loans payable

3,073,876

3,038,947

Advances received

899,779

1,162,813

Income taxes payable

428,710

190,009

Provision for bonuses

72,66071,377

Other

1,970,931

1,378,058

Total current liabilities

18,343,158

18,606,771

Long-term loans payable

6,672,675

5,930,281

Long-term deposits received

3,501,199

3,501,199

Provision for directors' retirement benefits

261,883

249,112

Provision for management board incentive plan trust

254,811261,208

Net defined benefit liability

267,504

281,584

Asset retirement obligations

491,279

480,215

Other

195,809

190,260

Total non-current liabilities

11,645,165

10,893,862

Total liabilities

29,988,323

29,500,634

Capital stock

5,000,000

5,000,000

Capital surplus

12,172,896

12,173,895

Retained earnings

7,056,711

6,737,248

Treasury shares(1,259,085)(1,259,417)

Total shareholders' equity

22,970,523

22,651,726

Valuation difference on available-for-sale securities

10,693(140,301)

Foreign currency translation adjustment(44,141)(75,891)

Remeasurements of defined benefit plans(1,945)(1,624)

Total accumulated other comprehensive income(35,393)(217,818)

Share acquisition rights

86,27485,698Non-controlling interests

342,508

329,463

Total net assets

23,363,913

22,849,070

Total liabilities and net assets

53,352,237

52,349,704

Non-current liabilities

Net assets
Shareholders' equity

Accumulated other comprehensive income―5―(2) Quarterly consolidated statements of income and statements of comprehensive income
Quarterly consolidated statements of income
Consolidated first quarter(Unit: thousand yen)
Q1 FY 2019
(January 1, 2019 –March 31, 2019)

Q1 FY2020(January 1, 2020 –March 31, 2020)

Net sales

15,470,991

13,049,745

Cost of sales

12,332,885

10,916,463

Gross profit

3,138,105

2,133,282

Selling, general and administrative expenses

2,504,341

2,016,880

633,764

116,402

Interest income

2,296

1,419

Dividend income

5,268

2,886

Insurance return

27,379

1,710

Other

27,71245,435

Total non-operating income

62,65651,453

Interest expenses

16,24018,568Commission fee
Share of loss of entities accounted for using equity
method41,67540,36943,305

42,108Other

31,146

61,474

Total non-operating expenses

132,369

162,521564,051

5,334－6,038Other1,152576

Total extraordinary income

1,152

6,614

Loss on change in equity

－

4,452

Other－

45

Total extraordinary losses－4,497

Profit before income taxes

565,203

7,451

Income taxes - current

230,234

167,264

Income taxes - deferred

89,311(132,635)

Total income taxes

319,545

34,629Profit (loss)

245,658(27,178)

Profit (loss) attributable to non-controlling interests(18,100)

5,774

Profit (loss) attributable to owners of parent

263,758(32,953)

Operating profit
Non-operating income

Non-operating expenses

Ordinary profit
Extraordinary income
Gain on sales of non-current assets

Extraordinary losses―6―Quarterly consolidated comprehensive statements of income
Consolidated first quarter(Unit: thousand yen)
Q1 FY 2019
(January 1, 2019 –March 31, 2019)

Profit (loss)

Q1 FY2020(January 1, 2020 –March 31, 2020)

245,658(27,178)

Valuation difference on available-for-sale securities

98,261(150,995)

Foreign currency translation adjustment

7,907(37,864)

Remeasurements of defined benefit plans, net of tax

285

320

Share of other comprehensive income of entities
accounted for using equity method

4,626(10,821)

Total other comprehensive income

111,080(199,360)

Comprehensive income

356,738(226,539)

371,582(225,369)(14,843)(1,169)Other comprehensive income

Comprehensive income attributable toComprehensive income attributable to owners ofparentComprehensive income attributable to non-controllinginterests―7―

(3) Notes to quarterly consolidated financial statements(Notes on the premise of a going concern)
Not applicable.
(Notes in the event of significant changes in shareholders’ equity)
Not applicable.

―8―