All Nippon Airways Trading Co., Ltd.
Financial Statements 2017

Non-consolidated Balance Sheet
All Nippon Airways Trading Co., Ltd.
As of March 31, 2017
Millions of yen
ASSETS2017

Current assets:
Cash and deposits (Note 9)¥708

Notes and accounts receivable - trade (Notes 3, 9 and 10)

9,580

Lease investment assets (Note 10)

7,133

Inventories

3,002

Short-term loans receivable (Notes 3, 9 and 10)

6,970

Deferred tax assets (Note 7)
Other current assets (Notes 3 and 10)
Allowance for doubtful accounts

166
2,682(10)30,233

Property, plant and equipment (Note 4):
Land

15

Buildings and leasehold improvements

57

Vehicles, tools, furniture and fixtures

80

Construction in progress

17

Rental assets

289
459

Intangible assets

900

Investments and other assets:
Investment securities (Note 9)

4,068

Investment securities of related parties

5,100

Long-term loans receivable (Notes 3 and 10)

1,175

Lease and guarantee deposits

9

Other assets

161

Allowance for doubtful accounts(405)
10,110Total assets

See notes to non-consolidated financial statements.

¥41,704

Millions of yen
LIABILITIES AND NET ASSETS2017Current liabilities:
Notes and accounts payable (Notes 3, 9 and 10)
Short-term loans payable (Notes 3, 9 and 10)¥10,399
5,610

Current portion of long-term loans payable (Note 9)

380

Current portion of lease obligations

874

Advances received (Notes 10)

1,090

Unearned revenue

569

Accrued operating expenses

97

Accrued income taxes

40

Other current liabilities

400
19,463Long-term liabilities:
Long-term debt, less current portion (Note 9)

1,680

Lease obligations, less current portion

5,507

Accrued employees' retirement benefits

400

Long-term deposits payable

382

Provision for directors' retirement benefits

97

Deferred tax liabilities

289

Other long-term liabilities (Note 3)

175
8,534

Net assets (Notes 5 and 8)
Shareholders' equity:

11,697

Common stock:
Authorized---2,880,000 shares at March 31, 2017
Issued---654,724 shares at March 31, 2017

1,000

Retained earnings:

10,697

Legal reserve

250

Retained earnings

Accumulated other comprehensive income:

10,447

2,009

Unrealized holding gain (loss) on securities

2,007

Deferred gain (loss) on hedging instruments

213,706

Total liabilities and net assets

See notes to non-consolidated financial statements.

¥41,704

Non-consolidated Statement of Income
All Nippon Airways Trading Co., Ltd.
Year ended March 31, 2017

Millions of yen
2017

Net sales (Notes 3 and 10)¥60,468

Cost of sales (Notes 3 and 10)

52,185Gross profit

8,282

Selling, general and administrative expenses

7,650

Operating income

632

Non-operating income (expenses) (Note 3):
Foreign exchange gain (Note 6)

60

Interest and dividend income

933

Reversal of allowance for doubtful accounts7Interest expenses(31)

Other - net

12Ordinary income

1,615

Extraordinary gains and (losses):Gain on sale of fixed assets

5

Other - net

10

Loss on sale of fixed assets(70)

Loss on valuation of securities(48)

Income before income taxes

1,511

Income taxes (Note 7):
Current

121

Deferred

122
244

Net income (Note 8)

See notes to non-consolidated financial statements.

¥1,267

Non-consolidated Statement of Changes in Net Assets
All Nippon Airways Trading Co., Ltd.
Year ended March 31, 2017
Millions of yen
Shareholders’ equity
CommonEarned surplusAccumulated other comprehensive income
Unrealized
holding gain(loss) on
securities

Deferred gain(loss) on
hedging
instruments

Total
accumulated
othercomprehensiveincome(¥11)¥1,304

Total net
assetsLegal reserve

Retained earnings

Total
shareholders’equity¥250¥10,583¥11,833

Cash dividends paid

(804)

(804)

(804)

Net income

1,267

1,267

1,267

Decrease due to corporate
division
Net changes of items other thanshareholders’ equity during theyear

(599)

(599)

(599)

Total changes during the year

(135)
¥10,447

stock
Balance at April 1, 2016

Balance at March 31, 2017

¥1,000¥1,000¥250

See notes to non-consolidated financial statements.

¥1,315¥13,137691

13705705(135)691

13705569¥11,697¥2,007¥2¥2,009¥13,706

Notes to Non-consolidated Financial Statements
All Nippon Airways Trading Co., Ltd.
Year ended March 31, 2017

1.

BASIS OF PRESENTATION
The accompanying non-consolidated financial statements of All Nippon Airways Trading Co., Ltd. (the“Company”) are prepared on the basis of accounting principles generally accepted in Japan, which are different incertain respects as to application and disclosure requirements of International Financial Reporting Standards.
In addition, the notes to non-consolidated financial statements include information which is not required underaccounting principles generally accepted in Japan but is presented herein as additional information. In preparing
the accompanying financial statements, certain reclassifications have been made in the financial statements
issued domestically in order to present them in a form which is more familiar to readers outside Japan.
As permitted by the regulations under the Corporation Law of Japan (the “Law”), amounts less than one million
yen have been omitted. As a result, the totals shown in the accompanying non-consolidated financial statements
for fiscal 2017 do not necessarily agree with the sum of the individual amounts.

2.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(a) Foreign currency translation
In accordance with the accounting standard for foreign currency translation, foreign currency payables andreceivables at March 31, 2017 are principally translated at the rate of exchange in effect at the balance sheet
date, except payables and receivables hedged by qualified forward foreign exchange contracts.

(b) Marketable securities and investment securities
The accounting standard for financial instruments requires that securities be classified into three categories;
trading, held-to-maturity or other securities. Under the standard, trading securities are carried at fair value andheld-to-maturity securities are carried at amortized cost. Marketable securities classified as other securities arecarried at fair value with changes in unrealized holding gains or losses, net of the applicable income taxes,
included directly in net assets. Non-marketable securities classified as other securities are carried at cost. Costof securities sold is determined by the moving average method.

(c) Inventories
Inventories are principally stated at cost determined by the moving average method. In cases where profitability
has declined, the book value is reduced accordingly.

(d) Property, plant and equipment (and depreciation)
Property, plant and equipment are stated at cost less accumulated depreciation.
Depreciation of property, plant and equipment, except for rental assets, is calculated based on estimated useful
lives by the following methods:

Buildings acquired on or after April 1, 1998 ---- Straight-line method
Facilities attached to buildings and other non-building structures acquired on or after April 1, 2016 ---Straight-line method
Others ---- Declining-balance method

The Company principally applies the following useful lives:
Buildings and leasehold improvements

3 – 60 years

Structures

10 – 20 years

VehiclesTools, furniture and fixtures

6 years2 – 20 years

Depreciation of rental assets is calculated by straight-line method over the lease period.

(e) Intangible assets and amortizationIntangible assets are amortized by the straight-line method. Cost of software purchased for internal use isamortized by the straight-line method over five years, the estimated useful life of purchased software.

(f)

Allowance for doubtful accounts
A general provision is made for doubtful receivables based on past experience. Provisions are also madeagainst specific receivables as and when required based on estimates of the collectability of receivables.

(g) Accrued employees’ retirement benefits
The retirement benefit plan of the Company covers substantially all employees other than directors. Under theterms of this plan, eligible employees are entitled, upon mandatory retirement or earlier voluntary severance, tolump-sum payments or annuity payments based on their compensation at the time of leaving and years ofservice with the Company. The Company has trustee employees’ pension funds to provide coverage for thepart of the lump-sum benefits or annuity payments. In accordance with the accounting standard for retirement
benefits, accrued employees’ retirement benefits at the balance sheet date are provided mainly at an amountcalculated based on the retirement benefit obligation and the fair market value of the pension plan assets at thebalance sheet date, as adjusted for unrecognized net retirement benefit obligation at transition, unrecognizedactuarial gains or losses and unrecognized prior service cost. The retirement benefit obligation is attributed toeach period by the straight-line method over the estimated service years of eligible employees.
Actuarial gains and losses are amortized in the year following the year in which the gains or losses arerecognized by the straight-line method over periods which are approximately equal to the average remaining
service years of employees. Prior service cost is being amortized as incurred by the straight-line method overperiods which are approximately equal to the average remaining service years of employees.

(h) Provision for directors’ retirement benefitsThe Company records a reserve for retirement benefits for directors and corporate auditors based on theamount payable at the balance sheet date based on the internal regulations.

(i)Leased assets and depreciation
Finance lease transactions under which ownership is not transferred are recognized as a normal salestransactions.

(j)Derivatives
The Company uses derivatives, such as forward foreign exchange contracts and interest rate swaps, to limit its
exposure to fluctuations in foreign exchange rates and interest rates. The Company does not use derivatives
for trading purposes. In principle, deferral hedge accounting is adopted for derivatives that qualify as hedges.

(k) Consumption taxes
Transactions subject to consumption taxes are recorded at amounts exclusive of consumption taxes.

(l)Deferred tax accounting
Deferred income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities
are recognized for the future tax consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their tax bases and operating losses and tax credits
carried forward. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply totaxable income in the years in which the temporary differences are expected to be recovered or settled. The
effect on deferred tax assets and liabilities of a change in tax rates is recognized in income or othercomprehensive income in the period the revised tax regulation is promulgated (See Note 7).

(m) Net income per share
The computation of net income per share is based on the weighted average number of shares outstanding
during each year.

(n) Consolidated tax payment system
The Company has applied the consolidated taxation system with ANA HOLDINGS INC. as the parent company.

(o) Changes in accounting policies(Practical Solution on a change in depreciation method due to Tax Reform 2016)
The Company adopted “Practical Solution on a change in depreciation method due to Tax Reform 2016”(ASBJ PITF No.32, June 17, 2016) as a result of revisions to the Corporate Tax Act of Japan. Accordingly, thedepreciation method for both facilities attached to buildings and other non-building structures acquired on orafter April 1, 2016 was changed from the declining-balance method to the straight-line method.
The impact of this change on income or expenses for the fiscal year ended March 31, 2017 was immaterial.

3.

TRANSACTIONS WITH PARENT COMPANY, SUBSIDIARIES AND AFFILIATES
Information on transactions with the parent company, subsidiaries and affiliates for the year ended March 31, 2017
was as follows:
Millions of yen
2017
Balances:
Notes and accounts receivable¥192

Short-term loans receivable

6,954

Other current assets

2,792

Long-term loans receivable

760

Notes and accounts payable

621

Short-term loans payable

5,870

Other short-term liabilities

5Long-term debt

1,560

Other long-term liabilities

175

Transactions:
Sales

1,260

Purchases

3,266Transactions other than operating transactions

4.

841

PROPERTY, PLANT AND EQUIPMENT
The following table sets forth the acquisition costs and related accumulated depreciation of certain property, plantand equipment at March 31, 2017:
Millions of yen
2017
Land

¥15

Buildings and leasehold improvements

136

Vehicles, tools, furniture and fixtures

420

Construction in progress

17

Rental assets

1,912
2,501

Less accumulated depreciation(2,041)¥459

5.

INCOME TAXESThe Company is subject to a number of taxes on income (corporation tax, inhabitants taxes and enterprise tax),
which, in aggregate, resulted in a normal statutory tax rate of approximately 30.86% for the year ended March 31,
2017. The tax effect of temporary differences that give rise to a significant portion of the deferred tax assets andliabilities at March 31, 2017 are as follows:
Millions of yen
2017
Deferred tax assets:
Provision for doubtful receivables¥117

Accrued employees' retirement benefits and pension expense

226

Valuation loss on marketable and investment securities

330

Accrued expenses

13

Other

238
926

Valuation allowance

(451)
475

Deferred tax liabilities:
Unrealized holding gain on securities

(480)

Other

(118)
(598)

Net deferred tax liabilities

6.

(¥123)AMOUNTS PER SHARE
Amounts per share as of and for the year ended March 31, 2017 are as follows:
Yen
2017Net income¥1,935.93

Net assets

20,934.84

7.

RELATED PARTY TRANSACTIONSThe Company has related party transactions with ANA HOLDINGS INC., the parent company, and subsidiaries andaffiliated companies. The corresponding balances at March 31, 2017 and the amounts of these transactions for theyear then ended are summarized as follows:

Millions of yen
Related parties

Balances

ANA HOLDINGS INC.

Current portion of long-term loans payable¥260

Long-term loans payable, less current portion

1,560

Short-term loans receivable

6,799

Other current assets (Advances)

1,197

ANA Foods Co., Ltd.

2017

Long-term loans receivable

641

Short-term loans receivable

118

Short-term loans payable

890

ANA FESTA Co., Ltd.

Short-term loans payable

2,305International Cargo Service Co.,

Notes and accounts payable

216

Ltd.

Short-term loans payable544

ANA Trading Duty Free Co., Ltd.

Short-term loans payable824

Fujisey Co., Ltd.

Short-term loans payable

734

Millions of yen
Related parties

Transactions

ANA HOLDINGS INC.

Borrowings¥1,820Loan of funds

6,799

Other current assets (Advances)

1,197

ANA Foods Co., Ltd.

Loan of funds
Interest receivable

ANA FESTA Co., Ltd.

9890

Dividend income

349

Borrowings

International Cargo Service Co.,

Purchase of products and goods and services

Ltd.

Borrowings
Dividend income

Fujisey Co., Ltd.

759

Borrowings

Dividend income

ANA Trading Duty Free Co., Ltd.

2017

2,305
60
1,363
544
55

Borrowings

824

Dividend income

198

Borrowings

734

Dividend income

23

The Company has related party transactions with other subsidiaries of ANA HOLDINGS INC. The correspondingbalances at March 31, 2017 and the amounts of these transactions for the year then ended are summarized asfollows:
Millions of yen
Related parties

Balances

All Nippon Airways Co., Ltd.

Notes and accounts receivable2017¥3,135

Advances received

961

Deferred income

505

Lease investment assets

1,278
500

Notes and accounts payablepanda Flight Academy Inc.

Lease investment assets

1,348

Millions of yen
Related parties

Transactions

All Nippon Airways Co., Ltd.

Sales of products and goods and services

panda Flight Academy Inc.

Leasing of flight simulators
Dividend income

2017¥23,775
1,348
42

Note:
1. Business transactions with related parties are carried out on an arm’s-length basis similar to third-party transactions.
2. Consumption taxes are not included in the amounts of these transactions.
3. Mileage business alliance agreement signed on March 1, 2008 with All Nippon Airways Co., Ltd. Was terminatedon March 31, 2017 with the expiration of the agreement period.
The sales amount related to this agreement was 4,722 million yen for the fiscal year ended March 31, 2017.

All Nippon Airways Trading Group(As of March 31, 2017)

Parent:・ANA HOLDINGS INC.

Subsidiaries:
・ANA Foods Co., Ltd.
・ANA Trading Corp., U.S.A.
・ANA Trading Duty Free Co., Ltd.
・ANA FESTA Co., Ltd.
・HIT Co., Ltd.
・International Cargo Service Co., Ltd.
・a-sweets house inc.
・Musashinomori Country Club Co., Ltd.
・Fujisey Co., Ltd.
・ANA-Kuroko Strategic Solutions Co., Ltd.
・ANA Digital Gate, Inc.

Affiliates:
・panda Flight Academy Co., Ltd.
・A2 Care Co., Ltd.
・Global Retail Partners Pte. Ltd.
・A&S Takashimaya Duty Free Co., Ltd.
・ANA X Inc.