May 9, 2019

Summary of Consolidated Financial Results for the Year Ended March 31, 2019
Company name:
Stock listing:Code number:President:
For inquiries, please contact:Tel:

SRA Holdings, Inc. (URL: https://www.sra-hd.co.jp/)
Tokyo Stock Exchange

3817
Toru Kashima
Toshiaki Kobayashi, General Manager, Finance Department, Administrative Headquarters(03)-5979-2666
Date of ordinary general meeting of shareholders:June 21, 2019
Scheduled commencement of dividend payment:
June 6, 2019
Scheduled date of submission of financial reports:
June 21, 2019
Results Supplement Materials: Yes
Results Presentation Meeting : Yes (for institutional investors)

1. Consolidated Financial Results for Fiscal 2019(from April 1, 2018 to March 31, 2019)(1) Consolidated Operating Results(All amounts rounded down, % change YoY)Net Sales

Fiscal 2019
Fiscal 2018

Operating Profit

Ordinary Profit

Net Income

Millions of Yen%

Millions of Yen%

Millions of Yen%

Millions of Yen%

40,79339,410

3.5
0.7

4,078
4,175

(2.3)
(0.1)

4,469
4,762

(6.2)
13.1

2,023
2,060

(1.8)
(22.2)

Note : Comprehensive Income
Fiscal 2019: ¥1,257million ((54.7)％)
Fiscal 2018: ¥2,772million (72.0％)
Net Income
per Share

Yen

Ratio of Net Income
to Shareholders’Equity%164.08167.129.5
10.0

Net Income per Shareafter Dilution

Yen
Fiscal 2019161.14
Fiscal 2018168.07
Reference: Gain (loss) on equity method investments:
Fiscal 2019: ¥10 million
Fiscal 2018: ¥687 million

Ratio of Ordinary
Profit to Total Assets

Ordinary Profit
Ratio

%

%

12.0
13.1

10.0
10.6

(2) Consolidated Financial Position
Millions of Yen%

Shareholders’ Equity
per ShareYen

21,37521,43857.9
56.6

1,730.60
1,737.59

Cash Flows fromOperating Activities

Cash Flows from
Investing Activities

Cash Flows from
Financing Activities

Cash and Cash Equivalents
at the End of Period

Millions of Yen

Millions of Yen

Millions of Yen

Millions of Yen

4,361
2,565

(4,953)(760)(2,405)(1,047)

3,997
7,018

Total Assets

Net Assets

Millions of Yen
Fiscal 201936,852
Fiscal 201837,756
Reference: Shareholders’ equity
Fiscal 2019: ¥21,349 million
Fiscal 2018: ¥21,379 million

Shareholders’ Equity Ratio(3) Consolidated Cash Flows

Fiscal 2019
Fiscal 2018

2. Dividends
Dividend per Share
End ofFirst
Quarter
Fiscal 2018
Fiscal 2019

End ofSecondQuarter

End ofThird
QuarterYear-end

For theyear

Total
Dividends(for the year)

Dividend
Propensity(consolidated)

Net Assets to
Dividend
Ratio(consolidated)

Yen

Yen

Yen

Yen

Yen

Millions of Yen

%

%

－
－
－

40.00
40.00
40.00

－
－
－

70.00
70.00
70.00

110.00110.00110.00

1,351
1,357

65.4
67.0
54.3

6.6
6.3

Fiscal 2029(forecast)
Note : 70 yen of year-end dividend for FY 2018 includes 5 yen of special dividend.

13. Consolidated Earnings Forecast for Fiscal 2020 (from April 1, 2019 to March 31, 2020)

Net Sales（% change YoY is for the fiscal year or for interim period）
Profit attributable to owners Net Income
Ordinary Profit
per Shareof the parent

Operating Profit

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

Yen

20,20041,700

1.2
2.2

1,950
4,500

12.9
10.3

2,000
4,600

(6.5)
2.9

1,070
2,500

25.7
23.5

86.73
202.65Interim Period
Full Year

4. Others(1) Changes to significant subsidiaries during the current period :No(2) Changes in accounting principles, changes in accounting estimates, and restatements
1. Changes caused by revision of accounting standards, etc. :No
2. Changes other than 1. above:No
3. Changes in accounting estimates:
No
4. Restatements:
No(3) Number of outstanding shares (common shares)
1. Shares issued at the end of term (including own shares)
Fiscal 2019: 15,240,000 sharesFiscal 2018: 15,240,000 shares
2. Own shares at end of term
Fiscal 2019: 2,903,279sharesFiscal 2018: 2,935,755 shares
3. Average number of shares over period
Fiscal 2019: 12,329,806sharesFiscal 2018: 12,257,719 shares（Reference）Non-Consolidated Financial Results for Fiscal 2019(1) Non-Consolidated Operating Results
Net Sales

Fiscal 2019
Fiscal 2018

Operating Profit(% change YoY)
Ordinary Profit

Net Income

Millions of Yen%

Millions of Yen%

Millions of Yen%

Millions of Yen

%

1,693
1,995

(15.1)
592.7

1,432
1,720

(16.8)
-

1,416
1,700

(16.7)
-

1,288
1,631

(21.0)-Net Income
per Share
Fiscal 2019
Fiscal 2018(from April 1, 2018 to March 31, 2019)

Net Income per Shareafter Dilution

Yen

Yen

95.27
121.3095.24
120.67(2) Non-Consolidated Financial Position
Total Assets

Net Assets

Millions of Yen

Millions of Yen

8,846
7,986
9,061
8,168
Reference: Shareholders’ equity:
Fiscal 2019: ¥ 7,960 million
Fiscal 2018: ¥ 8,109 million
Fiscal 2019
Fiscal 2018%

Shareholders’ Equity
per Share
Yen

90.0
89.5

588.53600.97

Shareholders’ Equity Ratio*This earnings release is not subject to the quarterly review process as required by the Financial Instruments and Exchange Act of Japan.
*Explanation relating to the appropriate use of results forecasts, and other noteworthy items
Forward-looking statements in this earnings release, such as forecasts of results of operations, are based on the information currently
available and the certain assumptions that we regard as reasonable and therefore actual results may differ materially from those containedin or suggested by any forward-looking statements.

2

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 20191.

Analysis of Business Results and Financial Position(1) Summary of Business Results
During the fiscal year (April 1, 2018 to March 31, 2019), the Japanese economy recorded a moderate recovery overall
as capital investment increased while the improvement in corporate earnings remains at a high level despite a noticeable
standstill and visible weakness in some exports and production.
. In the information services industry, despite an increase in IT investments, mainly by large and medium-sizedcompanies, the environment for securing orders remained severe due to intensifying competition.
Within this business environment, the SRA Holdings Group implemented the following key measures.
1) Improving profitability in existing operations• Further raise the gross profit margin
We implemented a variety of measures that included efforts to raise profitability by enhancing and strengthening project
management, continuously reduce production overhead costs, promote SRA’s proprietary IP product business andachieve the appropriate level of production staff. As a result, the gross profit margin reached an all-time high of 22.3%.
• Improve SG&A expenses-to-sales ratio
We strived to raise operation efficiency by introducing an account manager system while working to reduce operationalcosts of Head Office staff departments and SRA Professional Service, Co., Ltd., which handles a shared service. On
the other hand, the SG&A expenses-to-sales ratio increased to 12.3% due to higher research and development expenses
and selling expenses at Cavirin Systems, Inc. as well as the inclusion of sales, general and administrative (SG&A)(sales administrative) expenses of an overseas subsidiary that was incorporated into consolidated business results fromthe third quarter of the fiscal year.
• Raise operating profit ratio
The operating profit ratio, at 10.0%, was maintained at a high level similar to that of the previous fiscal year.
• Expand orders and sales
Priority measures will be to increase customer share of wallet by deeply cultivating existing customers as well as tofocus on securing new customers in growth fields, and in doing so, we worked to expand orders and sales.
2) Strengthening linkages between SRA’s proprietary IP product business and overseas operations
and transforming the SRA business model
Besides promoting a convergence between “SRA’s proprietary IP product business and higher added value in existing
operations,” we aimed to expand and upgrade the line of SRA’s proprietary IP products for growth fields as well as
promoted business that targets overseas markets, which are growth markets.
Due to the above initiatives, our consolidated business results for the fiscal year were as follows.
Sales of the Systems Development business, System Operations and Infrastructure Development business andProduct Sales business all increased. Therefore, consolidated net sales amounted to ¥40,793 million, a 3.5% increase
from the same period of the previous fiscal year. At the profit level, we achieved an increase in gross profit while thegross profit margin also improved as a result of a focus on measures to improve the profit margin. Nevertheless,
SG&A (sales administrative) expenses increased year on year and operating profit decreased 2.3% from the previous
year to ¥4,078 million due to higher research and development expenses and selling expenses at Cavirin Systems,
3

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019

Inc. in addition to the inclusion of the SG&A (sales administrative) expenses of an overseas subsidiary into ourconsolidated business results from the third quarter of the fiscal year. Moreover, ordinary profit decreased 6.2% year
on year to ¥4,469 million and profit attributable to owners of parent (hereafter, net income) decreased 1.8% from theprevious fiscal year to ¥2,023 million due to an increase in income taxes.
As detailed above, although consolidated net sales increased from the previous fiscal year, operating profit,
ordinary profit and net income all decreased from the previous fiscal year. Additionally, operating profit and net
income fell short of the full-year forecast while net sales and ordinary profit exceeded the full-year forecast.
Given that ordinary profit exceeded the full-year forecast and profit before income taxes also increased
year on year in the fiscal year ended March 31, 2019, to enhance the redistribution of profits to shareholders theCompany will pay year-end cash dividends per share of ¥70.00 (ordinary cash dividends), an increase of ¥5.00 versus
our dividend forecast (May 10, 2018), and full-year cash dividends per share of ¥110.00 (consisting of ordinary cash
dividends per share of ¥110.00, with a consolidated payout ratio of 67.0%).
*For details, please refer to the following.
Notice Concerning the Dividend Distribution (Increased Dividend) for Surplus Earnings
https://www.sra-hd.co.jp/news/?Year=2019 (Written in Japanese)

4

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019

Consolidated Business Results(Millions of Yen)

Net sales

36,535

39,155

39,142

39,410FY2019
Most recent forecast
figures (announced
November 8, 2018)
40,000Operating Profit

3,047

3,736

4,180

4,175

4,400

4,078

Ordinary profit

3,813

3,850

4,211

4,762

4,400

4,469

Net income

1,638

463

2,646

2,060

2,800

2,023

FY2015FY2016FY2017FY2018Actual
40,793A summary of consolidated business results for the fiscal year by business segment is shown below.
● Systems Development
The Systems Development business recorded increases in sales to manufacturing industries. As a result, net sales
increased 1.2% from the previous fiscal year to ¥22,106 million.
● System Operations and Infrastructure Development
University-related orders and orders from companies both increased. As a result, net sales of the System Operations
and Infrastructure Development business increased 7.5% from the previous fiscal year to ¥4,988 million.
● Product Sales
Device sales by Advanced Integration Technology, Inc. increased. As a result, net sales of the Product Sales businessincreased 6.0% from the previous fiscal year to ¥13,698 million.
(2) Summary of Financial Position
Total assets at the end of the fiscal year amounted to ¥36,852 million, a decrease of 2.4% from the end of the previous
fiscal year. Total liabilities decreased 5.1% from the end of the previous fiscal year to ¥15,477 million and net assets
decreased 0.3% to ¥21,375 million from the end of the previous fiscal year. Details of the principal increases anddecreases from the end of the previous fiscal year are as follows.
(Total Assets)
Investment securities increased ¥1,291 million to ¥10,645 million and merchandise and finished goods increased¥456 million to ¥1,103 million. On the other hand, long-term loans receivable decreased ¥2,035 million to ¥1,144
million and work in process decreased ¥609 million to ¥957 million.
(Total Liabilities)
Accounts payable - trade increased ¥750 million to ¥3,621 million and advances received increased ¥540 million to¥3,448 million. On the other hand, provision for loss on litigation decreased ¥1,198 million and short-term loans
payable decreased ¥980 million to ¥198 million.
(Total Net Assets)
Retained earnings increased ¥669 million to ¥18,033 million. On the other hand, valuation difference on availablefor-sale securities decreased ¥578 million to ¥76 million and foreign currency translation adjustment
decreased ¥226 million to ¥219 million.
5

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019(3) Summary of Cash Flows
Cash and cash equivalents on a consolidated basis at the end of the fiscal year decreased ¥3,021 million compared withthe previous fiscal year-end to ¥3,997 million.
The status of cash flows and factors underlying changes in cash flows for the fiscal year are shown below.
Cash Flows from Operating Activities
Net cash provided by operating activities amounted to ¥4,361 million compared with ¥2,565 million in the previous
fiscal year. This consisted mainly of such cash inflows as profit before income taxes of ¥4,050 million and anincrease in notes and accounts payable - trade of ¥625 million, while cash outflows were primarily income taxes paidof ¥1,206 million and of decrease in provision for loss on litigation of ¥1,198 million.

Cash Flows from Investing Activities
Net cash used in investing amounted to ¥4,953 million compared with net cash used in investing activities of ¥760
million in the previous fiscal year. This consisted mainly of such inflows as ¥110 million in proceeds from sales ofinvestment securities, while outflows included ¥2,288 million for the purchase of investment securities and ¥1,887
million for payments of loans receivable.

Cash Flows from Financing Activities
Net cash used in financing activities amounted to ¥2,405 million compared with ¥1,047 million in the previous fiscal
year. This was due mainly to such cash inflows as ¥58 million in proceeds from exercise of share options and such cash
outflows as ¥1,354 million in cash dividends paid.
Cash Flow Indicators
FY 2017

FY2018FY2019

Shareholders’ equity ratio (%)
Shareholders’ equity ratio at market value (%)

56.5

56.6

57.9

103.3

99.6

82.5

Debt redemption years to cash flow (years)

0.3

0.5

－

101.7

67.0

206.0

Interest coverage ratio (times)
Notes:
Shareholders’ equity ratio: Shareholders’ equity/total assets

Shareholders’ equity ratio at market value: Market capitalization/total assets
Debt redemption years to cash flow: Interest-bearing debt/operating cash flow
Interest coverage ratio: Operating cash flow/interest expenses
1. All indicators were calculated using consolidated financial figures.
2. Market capitalization is calculated using the total number of shares outstanding at the end of the fiscal period
excluding treasury stock.
3. Cash flows from operating activities is used for cash flow.
4. Interest-bearing debt includes all debt that pays interest as listed on the Consolidated Balance Sheets.

6

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019

(4) Future Outlook
In the next fiscal year, the Japanese economy is expected to sustain a recovery centering on domestic demand amid theprogression of an economic virtuous cycle with continuous improvements in the employment and income environments.
Nevertheless, the impact of trade problems on the global economy, uncertainties in overseas economies, the impact offluctuations in financial and capital markets and other matters require close attention.
Under these conditions, the SRA Holdings Group aims to raise corporate value and shareholder value and establish
a foundation for existing businesses while vigorously promoting “digital transformation (DX)” that will serve as thecore of new business promotion as we make efforts toward achieving sustainable growth, improving profitability andfurther enhancing shareholder returns.
Reference: Notice Concerning the Establishment of the Medium-Term Management Strategy (Announced on May 9,2018)https://www.sra-.co.jp/ir/manage_policy.html (Japanese only)
With regards to the outlook for consolidated results for the fiscal year ending March 31, 2020, we forecast net
sales of ¥41,700 million, operating profit of ¥4,500 million, ordinary profit of ¥4,600 million and profit attributable toowners of parent of ¥2,500 million.
Regarding dividends for the fiscal year ending March 31, 2020, we plan to pay ordinary cash dividends per shareof ¥110.00 (consisting of a ¥40.00 interim dividend and a year-end dividend of ¥70.00). In the event that these dividends
are paid, the consolidated payout ratio is expected to be 54.3%.
Based on our policy of enhancing shareholder returns, we will strive to pay stable and high dividends with the aimof attaining a 50% payout ratio as in the past.
We regard the purchase of treasury stock as one effective means of returning profits to shareholders and willappropriately respond while taking into consideration such factors as stock price trends and our financial condition.

2.

Basic Thinking Concerning Adoption of Accounting Standard

In preparation for the future adoption of International Financial Reporting Standards (IFRS), discussion is progressing
regarding the establishment of in-house manuals and guidelines and the timing of adoption.

7

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 20193.

Consolidated Financial Statements(1) Consolidated Balance Sheets(Millions of Yen)
As of March 31, 2018

As of March 31, 2019ASSETS
Current assets:
Cash and deposits

7,629

5,121

Notes and accounts receivable - trade

6,932

6,955

Securities

108

95

Merchandise and finished goods

647

1,103

1,566

957

Short-term loans receivable

416

2,935

Accounts receivable - other

2,874

2,814

Other

1,922

622

Allowance for doubtful accounts

(37)

(16)

22,061

20,589Buildings

376

432

Accumulated depreciation

(268)

(289)

Buildings, net

107

142

Machinery, equipment and vehicles

530

547

Accumulated depreciation

(491)

(505)

Machinery, equipment and vehicles, net

39

41

Other

136

164

Accumulated depreciation

(91)

(101)

Other, net

45

63

Total property, plant and equipment

192

247

1,310

1,543

1,310

1,543

Investment securities

9,353

10,645Long-term loans receivable

3,179

1,144

Deferred tax assets

2,211

2,059

Guarantee deposits

384

383

Net defined benefit asset

46

47

Other

555

218

Allowance for doubtful accounts(1,519)(9)

Allowance for investment loss

(19)

(17)

Total investments and other assets

14,191

14,471

Total non-current assets

15,695

16,263

Total assets

37,75636,852Work in process

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

Intangible assets
Other
Total intangible assets
Investments and other assets

8

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019

(Millions of Yen)
As of March 31, 2018

As of March 31, 2019

LIABILITIESCurrent liabilities:
Accounts payable - trade

2,871

3,621

Short-term loans payable

1,179

198

Accrued expenses

859

1,119

Income taxes payable

735

1,129

Accrued consumption taxes

506

537

Advances received

2,908

3,448

Provision for bonuses

565

565

Provision for directors’ bonuses

49

75

Provision for loss on construction contracts

780

340

1,198

－

294

313

11,94911,349

68

9

4,134

3,926

Provision for directors’ retirement benefits

165

182

Other

－

10

4,368

4,128

16,317

15,477

Capital stock

1,000

1,000

Capital surplus

4,671

4,704

Retained earnings

17,364

18,033

Treasury shares(2,437)(2,402)

Total shareholders’ equity

20,59821,335

Valuation difference on available-for-sale securities

654

76

Foreign currency translation adjustment

445

219

Remeasurements of defined benefit plans

(319)

(282)

Total accumulated other comprehensive income

780

14

59

25

Total net assets

21,43821,375

Total liabilities and net assets

37,75636,852

Provision for loss on litigation
Other
Total current liabilities
Non-current liabilities:
Deferred tax liabilities
Net defined benefit liability

Total noncurrent liabilities
Total liabilities
NET ASSETS
Shareholders’ equity

Accumulated other comprehensive income

Share acquisition rights

9

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income(Consolidated Statements of Income)(Millions of Yen)
As of March 31, 2018

As of March 31, 2019

Net sales

39,41040,793

Cost of sales

30,89631,707Gross profit

8,514

9,086

Selling, general and administrative expenses

4,338

5,007

Operating profit

4,175

4,078

Interest income

78

148

Dividend income

9448

Foreign exchange gains

–

200

687

10

Other

45

36

Total non-operating income

905

444

Interest expenses

38

22

Foreign exchange losses

253－

Stock transfer agency service fee

16

15Commission expenses

–

7

Other

9

7

318

53

4,762

4,469

328

479

3

69

332

549

Loss on retirement of non-current assets

02

Loss on valuation of investment securities

3

542

Provision of allowance for doubtful accounts

311

406

1,612

17

20

－

Total extraordinary losses

1,948

968

Profit before income taxes

3,146

4,050

Income taxes-current

1,476

1,646

Income taxes-deferred

(390)

379

Total income taxes

1,086

2,026

Profit

2,060

2,023

(0)

－

2,060

2,023

Non-operating income

Share of profit of entities accounted for using
equity method

Non-operating expenses

Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of investment securities
Other
Total extraordinary income
Extraordinary losses

Loss on litigation
Other

Profit (loss) attributable to non-controlling interests
Profit attributable to owners of parent
10

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019

(Consolidated Statements of Comprehensive Income)(Millions of Yen)
As of March 31, 2018
ProfitAs of March 31, 2019

2,060

2,023

Valuation difference on available-for-sale securities

550

(578)

Foreign currency translation adjustment

60

(155)

Remeasurements of defined benefit plans, net of tax

30

37

70

(70)

712

(766)

2,772

1,257

2,772

1,257

(0)

－

Other comprehensive income

Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income
Comprehensive income(Comprehensive income attributable to)Comprehensive income attributable to owners ofparentComprehensive income attributable to noncontrolling interests

11

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019(3) Consolidated Statement of Changes in Equity
FY2018 (April 1, 2017-March 31, 2018)(Millions of Yen)
Shareholders’ equity
CapitalCapitalRetained

Treasurystock

surplusearnings

sharesBalance at beginning of period

1,000

4,589

16,527

Total
shareholders’ equity(2,545)

19,571

Changes of items during the period
Dividends of surplus(1,222)(1,222)

2,060

2,060

Profit attributable to owners ofparentCapital increase of consolidated

3

subsidiaries

3

Purchase of treasury shares
Disposal of treasury shares

78

(0)

(0)

108

186

Net change of items other thanshareholders’ equity

–
–

81

837

107

1,026

1,000

4,671

17,364(2,437)

20,598

Total changes of items during period
Balance at the end of period

Accumulated other comprehensive income
Valuationdifference

Foreignoncurrency

available- translation
for-saleadjustment

securities
Balance at beginning of period

103

313

Remeasure-Totalments ofaccumulated

definedotherbenefitcomprehen-plans

sive income(349)

Subscription
rights toshares68

34

Total net
assets

19,674

Changes of items during the period
Dividends of surplus(1,222)

Profit attributable to owners of

2,060

parentCapital increase of consolidated

3

subsidiaries
Purchase of treasury shares(0)

Disposal of treasury shares186

Net change of items other thanshareholders’ equity

550

131

30

712

25

737

Total changes of items during period

550

131

30

712

25

1,764

Balance at the end of period

654

445

(319)

780

59

21,43812

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019

FY2019 (April 1, 2018-March 31, 2019)(Millions of Yen)
Shareholders’ equity
CapitalCapitalsurplusstock
Balance at beginning of period

Retained

1,000

TreasuryTotalsharesShareholders'earnings

4,671

equity17,364(2,437)

20,598Changes of items during the period
Dividends of surplus
Profit attributable to owners ofparentCapital increase of consolidated(1,354)(1,354)

2,023

2,023

5

subsidiaries

5

Purchase of treasury shares
Disposal of treasury shares

28

(0)

(0)

35

63

Net change of items other thanshareholders’ equity–

Total changes of items during period

–

33

669

34

736

Balance at the end of current period

1,000

4,704

18,033(2,402)

21,335

Accumulated other comprehensive income
Valuationdifference

Foreignoncurrency

available- translation
for-saleadjustment

securities
Balance at beginning of period

654

445

Remeasure-ments ofdefinedbenefit

Total
accumulate Subscriptio
n rights tod othercomprehensharesTotal net
assets

-sive

plans

income

(319)

780

59

21,438Changes of items during the period
Dividends of surplus–(1,354)

Profit attributable to owners ofparent–2,023

Capital increase of consolidated
subsidiaries–

5

Purchase of treasury shares–(0)

Disposal of treasury shares–

63

Net change of items other thanshareholders’ equity

(578)

(226)

37

(766)

(33)

(800)

Total changes of items during period

(578)

(226)

37

(766)

(33)

(63)

Balance at the end of current period

76

219

(282)

14

25

21,37513

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019(4) Consolidated Statements of Cash Flows(Millions of Yen)
As of March 31, 2018

As of March 31, 2019

3,146

4,050

Depreciation

444

512

Amortization of goodwill

26－

Increase (decrease) in net defined benefit liability

37

(208)

Increase (decrease) in provision for directors’ retirement
benefits

10

17

Increase (decrease) in provision for bonuses

(32)

(0)

Increase (decrease) in provision for directors’ bonuses

(47)

25

Increase (decrease) in allowance for doubtful accounts

298

14

Increase (decrease) in allowance for investment loss

1

(1)

360

(440)

Increase (decrease) in provision for loss on litigation

1,198(1,198)Interest and dividend income

(172)

(197)

Interest expenses

38

22

Commission expenses－

7

Foreign exchange losses (gains)

253

(200)

Share of loss (profit) of entities accounted for using equity
method

(687)

(10)

3

542

(328)

(479)

0

2

Decrease (increase) in notes and accounts receivable - trade

458

35

Decrease (increase) in inventories

(165)

207

Increase (decrease) in notes and accounts payable - trade

(368)

625

Decrease (increase) in other current assets

(475)

1,409

Increase (decrease) in other liabilities

315

681

Increase (decrease) in accrued consumption taxes

38

31

Other, net

72

(23)

Subtotal

4,426

5,425

Interest and dividend income received

155

163

Interest expenses paid

(38)

(21)

Income taxes paid

(1,978)(1,206)

Net cash provided by operating activities

2,565

4,361

Purchase of property, plant and equipment

(77)

(60)

Purchase of intangible assets

(459)

(269)

Purchase of investment securities(932)(2,288)Proceeds from sales of investment securities

1,308

110

Cash flows from operating activities
Profit before income taxes

Increase (decrease) in provision for loss on construction
contracts

Loss (gain) on valuation of investment securities
Loss (gain) on sales and valuation of investment securities
Loss on retirement of non-current assets

Cash flows from investing activities

14

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019

Purchase of shares of subsidiaries and associates

–

(92)

Purchase of shares of subsidiaries resulting in change in scopeof consolidation

–

(35)

Payments of loans receivable(1,446)(1,887)

Collection of loans receivable

1,020

55

Payments into time deposits

(150)

(531)

Proceeds from withdrawal of time deposits－

45

Payments for guarantee deposits

(6)

(0)

Proceeds from collection of guarantee deposits

00Other, net

(17)

(0)

Net cash used in investing activities(760)(4,953)

Net increase (decrease) in short-term loans payable－(1,109)Proceeds from share issuance to non-controlling shareholders

3

5

Purchase of treasury shares

(0)

(0)

(1,222)(1,354)

Proceeds from exercise of share options

172

58

Commission expenses－(4)

Other, net－

0(1,047)(2,405)

Effect of exchange rate change on cash and cash equivalents

(4)

(23)

Net increase (decrease) in cash and cash equivalents

752(3,021)

Cash and cash equivalents at beginning of period

6,265

7,018

Cash and cash equivalents at end of period

7,018

3,997

Cash flows from financing activities

Cash dividends paid

Net cash used in financing activities

15

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019(5) Notes to the Consolidated Financial Statements(Notes on the Premise of a Going Concern)
None(Changes to significant subsidiaries during the consolidated fiscal period)
None
There were no changes to specified subsidiaries. However, in the second quarter, Proxim Wireless Corporation,
which became a subsidiary due to the acquisition of an additional equity interest, is included in the scope of
consolidation.
(Change in presentation method)
Consolidated Balance Sheets*The Company has adopted the Partial Amendments to Accounting Standard for Tax EffectAccounting (ASBJ Statement No. 28, February 16, 2018) from the beginning of the fiscal year underreview and deferred tax assets are presented in investments and other assets and deferred tax
liabilities are presented in non-current liabilities. As a result, deferred tax assets (¥1,075 million in
the previous fiscal year) that were classified within current assets in the previous fiscal year are included indeferred tax assets of ¥2,211 million presented in investments and other assets in the fiscal year underreview.

16

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019

Segment Information and Others
Segment Information
1. Summary of Reporting Segments
The SRA Holdings Group’s reporting segments are those for which financial information separate from that of otherunits comprising the SRA Holdings Group can be obtained. Periodic reviews are made of reporting segments by the
Board of Directors for determining the allocation of management resources and assessment of business results.
The Company carries out overall management of subsidiaries engaged in the three businesses of “Systems
Development,” “System Operations and Infrastructure Development” and “Product Sales.” Therefore, the SRA
Holdings Group’s three reporting segments are “Systems Development,” “System Operations and Infrastructure
Development” and “Product Sales.”Principal contents of business in each segment
Business segment

Content of businessIntegrated system development ranging from defining requirements todevelopment and maintenance of mainframe-based large systems


Systems Development

System integration covering system planning, development and introduction ofopen systems

Solutions business offering business tools that utilize various products and toolsOpen source business that offers technical support for systems through open
source software

System Operations andInfrastructure
Development

Product SalesOperation management of computer systems and network systems

Overall operation that includes data management and facilities management

Building of network systems



Outsourcing services

Sales of packaged software that includes licensingSales of system devices, centering on servers, in integration servicesConsulting services related to the introduction of IT

2. Accounting Treatment Method of Net Sales and Income or Losses, Assets, Liabilities and Others for Each Reporting
Segment
The accounting treatment method for the reporting business segments is the same as that described in Principal Items
That Serve as the Basis for Preparing the Consolidated Financial Statements.
Inventories are valued at an amount prior to the writing down of carrying value.
The figures for segment profits are on the basis of operating profit.
Intersegment sales or transfers are based on current market prices.

17

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019

3. Information Concerning Net Sales and Income or Losses, Assets, Liabilities and Others for Each Reporting Segment
Fiscal 2018 (from April 1, 2017 to March 31, 2018)(Millions of Yen)
AmountSystemrecorded on

Operations

Systems
Development

Product

andInfrastructure

Adjustment

Total

Sales

amount*1

theconsolidated
statements ofDevelopment

income *2

Sales(1) Sales to21,843

4,640

12,926

39,410－39,410

27

210

371

608

(608)

－

Total sales

21,8704,850

13,29740,019(608)

39,410Operating profit

3,654

1,202

835

5,692

(1,516)

4,175

Assets10,410

1,773

6,298

18,482

19,27337,756

49

8

385

443

0

444

－

－

27

27

－

27

88

17

393

500

1

502

customers(2) Intersegment
sales ortransfers

OthersDepreciation
Amortization of
goodwill
Increase of
tangible andintangible
assets
Notes:
1. The adjustment amounts are as follows:(1) The segment income adjustment of minus ¥1,516 million is a company-wide expense not apportioned to any
reporting segment. Company-wide expenses are general and administrative expenses and R&D expenses not
attributed to any reporting segment.
(2) Total Company assets amounted to ¥19,710 million for the fiscal year. These consisted mainly of the SRA HoldingsGroup’s surplus operating assets (cash, deposits and marketable securities), short-term loans receivable, long-term
invested assets (investment securities and long-term loans receivable) and deferred tax assets.
(3) Depreciation expenses and increases of tangible and intangible assets included depreciation and additions to longterm prepaid expenses, respectively.

18

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019

2. Segment operating profit is adjusted in operating profit on the consolidated statements of income.
Fiscal 2019 (from April 1, 2018 to March 31, 2019)(Millions of Yen)
AmountSystemrecorded on

Operations

Systems
Development

Product

andInfrastructure

Sales

Total

Adjustment

theamount*1

consolidated
statements ofDevelopment

income *2

Sales(1) Sales to22,106

4,988

13,69840,793－40,793

11

210

246

467

(467)

－

Total sales

22,118

5,198

13,944

41,261(467)

40,793Operating profit

3,909

1,254

370

5,534

(1,455)

4,078

Assets

8,973

1,486

6,697

17,157

19,69536,852

50

9

451

511

0

511

74

22

254

351

－

351

customers(2) Intersegment
sales ortransfers

OthersDepreciation

Increase of
tangible andintangible
assets
Notes:
1. The adjustment amounts are as follows:(1) The segment income adjustment of minus ¥1,455 million is a company-wide expense not apportioned to any
reporting segment. Company-wide expenses are general and administrative expenses and R&D expenses not
attributed to any reporting segment.
(2) Total Company assets amounted to ¥19,990 million for the fiscal year. These consisted mainly of the SRA HoldingsGroup’s surplus operating assets (cash, deposits and marketable securities), short-term loans receivable, long-term
invested assets (investment securities and long-term loans receivable) and deferred tax assets.
(3) Depreciation expenses and increases of tangible and intangible assets included depreciation and additions to longterm prepaid expenses, respectively.
2. Segment operating profit is adjusted in operating profit on the consolidated statements of income.

19

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019

（Per share information）
As of March 31, 2018

As of March 31, 2019

Net assets per share

1,737.59

Net assets per share

1,730.60

Earnings per share

168.07

Earnings per share

164.14

Diluted earnings per share

167.12

Diluted earnings per share

164.08

Note: The basis for calculation of earnings per share and diluted earnings per share is as follows.

As of March 31, 2018

As of March 31, 2019

Earnings per share
Profit attributable to owners of parent

2,060

2,023

－

－

2,060

2,023

12,257

12,329

－

－

70

4

(70)

(4)

－

The 16th(million yen)Amount not belonging toordinary shareholders (million yen)
Profit attributable to owners ofparent in relation to common stock(million yen)
Average number of shares during the
fiscal year (1,000 shares)
Diluted earnings per share
Adjustment for profit attributable toowners of parent (million yen)
Increase in number of shares ofcommon stock (1,000 shares)(Including subscription rights to
new shares (1,000 shares))
Outline of potential shares notincluded in calculation of current net

subscription rights to sharesincome per share after adjustments

147,000 shareson potential shares due to no dilution
effect.

(Significant subsequent events)
Not applicable

20

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019

(Additional information)(Regarding the filing of a damage lawsuit)
2. Software Research Associates, Inc. (a company subsidiary, hereafter SRA) filed a damage lawsuit against Sanko
Estate Co., Ltd., (hereafter Sanko Estate) on August 25, 2015. In response, Sanko Estate filed a lawsuit against SRA
in the Tokyo District Court on October 6, 2015. These cases are currently being litigated. In accordance with theprogress of the lawsuits, we will promptly provide information on any matters requiring disclosure.

21

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019

4. Other Information
1. Status of Production, Orders and Sales(1) Production amounts
Production by segment in the fiscal year ended March 31, 2019 is as follows.
Segment information by type of business

As of March 31, 2019 (April 1,
2018-March 31, 2019)

Systems Development (Millions of Yen)

21,417

97.2

4,980

107.0

26,398

98.9

System Operations and Infrastructure
Development (Millions of Yen)
Total (Millions of Yen)

% change YoY

Notes:
1. Amounts are based on sales price.
2. The amounts above do not include consumption tax.
3. Intersegment transactions are offset.

(2) Purchase amounts
Purchases by segment in the fiscal year ended March 31, 2019 are as follows.
Segment information by type of business

As of March 31, 2019 (April 1,
2018-March 31, 2019)% change YoY

Product Sales (Millions of Yen)

8,026

109.1

Total (Millions of Yen)

8,026

109.1

Notes:
1. Amounts are based on purchase price.
2. The amounts above do not include consumption tax.
3. Intersegment transactions are offset.

22

SRA Holdings, Inc. (3817) Summary of Consolidated Financial Results for the Year Ended March 31, 2019(3) Status of orders
Status of orders by segment in the fiscal year ended March 31, 2019 is as follows.
OrdersSegment information by type of business

Order backlog

received(Millions of% change YoY% change YoY

Yen)

Yen)
Systems Development(Millions of

21,308

96.6

4,020

83.4

5,010

104.0

2,211

101.0

Product Sales

14,095

105.8

3,986

111.1

Total

40,415100.5

10,21996.4

System Operations and Infrastructure
Development

Notes:
1. Amounts are based on sales price.
2. The amounts above do not include consumption tax.
3. Intersegment transactions are offset.

(4) Sales amounts
Sales by segment in the fiscal year ended March 31, 2019 are as follows.
Segment information by type of business

As of March 31, 2019 (April 1,
2018-March 31, 2019)

Systems Development (Millions of Yen)

% change YoY

22,106

101.2

4,988

107.5

Product Sales (Millions of Yen)

13,698106.0

Total (Millions of Yen)

40,793

103.5

System Operations and Infrastructure
Development (Millions of Yen)

Notes:
1. Amounts are based on sales price.
2. The amounts above do not include consumption tax.
3. Intersegment transactions are offset.

23