May 11, 2017

Financial Results for the Year Ended March 31, 2017 [J-GAAP]
Company name:AIRPORT FACILITIES CO., LTD. (AFC)Stock exchange listed on:
Tokyo Stock Exchange (First Section)
Company code:
8864
URL: http://www.afc.jp
Representative: Hiroshi Maruyama, President and CEO
Inquiries: Takahiro Hama, General Manager of Accounting Dept. TEL: +81-3-3747-0251
The date of the ordinary general shareholders’ meeting:June 29, 2017
The date of the dividend payment start:
June 30, 2017
The date of filing the securities report:
June 29, 2017
Preparation of earnings presentation material:
Yes
Holding of earnings announcement:
Yes (for analysts)(Figures are rounded off to the nearest million yen.)

1. Consolidated Financial Results for the Year Ended March 2017 (April 1, 2016 - March 31, 2017)(1) Consolidated Business Results(Percentages are changes from the same period of the previous year.)
Profit attributable to
Net sales
Operating income
Ordinary income
owners of parent
Fiscal year ended

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

21,662
20,697

4.6
(2.0)

3,825
2,944

29.9
(7.0)

3,492
3,173

10.0
0.3

2,151
1,935

11.1
28.6

March 31, 2017
March 31, 2016
(Note) Comprehensive income:Fiscal year ended March 31, 2017:
Fiscal year ended March 31, 2016:

Net income
per share

Diluted net income
per share

Fiscal year ended

March 31, 2017
March 31, 2016

2,398 million yen
1,558 million yen(53.9%)((53.9%))Ordinary income toOperating margin
total assets

Return on equity

Yen

Yen

%

%

%

41.63
37.46

41.55
37.43

4.2
3.9

4.0
3.7

17.7
14.2

(Reference) Equity in earnings of affiliates:－ million yen－ million yen

Fiscal year ended March 31, 2017:
Fiscal year ended March 31, 2016:(2) Consolidated Financial Position
Total assets

Equity ratio

Net assets per share

Millions of yen

Millions of yen%

Yen

87,58085,21453,41551,644

58.7
58.5

995.53965.69As of March 31, 2017
As of March 31, 2016
(Reference) Equity capital:

Net assets

As of March 31, 2017: 51,437 million yen

As of March 31, 2016: 49,888 million yen(3) Consolidated Cash Flows
Cash flows fromoperating activities
Fiscal year ended

Cash flows frominvesting activities

Cash flows fromfinancing activities

Cash and cash equivalents
at year end

Millions of yen

Millions of yen

Millions of yen

Millions of yen

3,024
809

(3,048)(2,453)

(137)
1,731

5,713
5,974

March 31, 2017
March 31, 2016
2. Dividends

Total
dividends(annual)Dividends per share

Q1
Fiscal year ended

Q2

Q3

Q4

AnnualPayout ratio(consolidated)

Dividends to
net assets(consolidated)

Yen

Yen

Yen

Yen

Yen

Millions of yen

%

%

―
―

6.00
6.00

―
―

6.00
7.00

12.00
13.00

619
671

32.0
31.2

1.2
1.3

―

7.00

―

7.00

14.00

March 31, 2016
March 31, 2017
Fiscal year ending

March 31, 2018
(Forecasts)

31.3

3. Forecast of Consolidated Earnings for the Year Ending March 2018 (April 1, 2017 - March 31, 2018)(Percentages are changes from the same period of the previous year.)Net salesFirst half
Full fiscal year

Operating income

Profit attributable toowners of parent

Ordinary income

Basic earnings
per share

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

Yen

11,05022,180

1.8
2.3

2,050
3,860

0.1
0.9

2,090
3,640

0.0
4.2

1,360
2,310

7.8
7.3

26.32
44.71

- 1 -

＊Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting from changes in scope of consolidation): No(2) Changes in accounting policies, changes in accounting estimates, and restatement of revisions
1) Changes in accounting policies with revision of accounting standards, etc. : No
2) Changes in accounting policies other than 1) above: No
3) Changes in accounting estimates: No4) Restatement of revisions: No(3) Number of issued shares (common shares)
1) Number of issued shares
As of March 31, 2017:
54,903,750 shares As of March 31, 2016:
54,903,750 shares(including treasury stock)2) Number of treasury stock
As of March 31, 2017:
3,235,711 shares As of March 31, 2016:
3,242,974 shares
3) Average number of shares during Year ended March 31,
Year ended March 31,
51,664,990 shares
51,660,953 sharesthe period
2017:
2016:

(Reference) Summary of Non-consolidated Results
1. Non-consolidated Financial Results for the Year Ended March 2017 (April 1, 2016 - March 31, 2017)(Percentages are changes from the same period of the previous year.)(1) Non-consolidated Business Results
Operating income
Ordinary income
Net income
Net sales
Fiscal year ended

March 31, 2017
March 31, 2016

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

18,536
17,813

4.0
(2.9)

2,402
2,005

19.8
(20.0)

2,444
2,489

(1.7)
(8.6)

1,627
1,679

(3.0)
17.9

Net income per
share
Fiscal year ended

March 31, 2017
March 31, 2016

Diluted net income
per share

Yen

Yen

31.50
32.50

31.44
32.47

Total assets

Net assets(2) Non-consolidated Financial Position

As of March 31, 2017
As of March 31, 2016
(Reference) Equity capital

Equity ratio

Net assets per share

Millions of yen

Millions of yen%

Yen

76,09175,24949,971
48,74965.6
64.7

966.10943.07

As of March 31, 2017: 49,916 million yen

As of March 31, 2016: 48,719 million yen

2. Forecast of Non-consolidated Earnings for the Year Ending March 2018 (April 1, 2017 – March 31, 2018)(Percentages are changes from the same period of the previous year.)Net salesFirst half
Full fiscal year

Ordinary income

Net income

Net income per share

Millions of yen%

Millions of yen%

Millions of yen

%

Yen

9,480
18,980

2.1
2.3

1,580
2,810

0.0
14.9

1,090
1,940

0.9
19.2

21.09
37.54

＊The audit procedures are not applicable to this Financial Results report.
＊Explanation of the proper use of earnings forecasts and other special notes
The statements about future described on this report such as earnings forecasts have been made based on information currently available andsome conditions that we judge rational, and therefore they do not constitute a guarantee that they will be realized. Actual earnings may differ
greatly from the above forecasts for various reasons. For the assumptions for earnings forecasts and cautions regarding the use of the earnings
forecasts, please refer to page 4 “1. Summary of Operating Results, etc. (4) Future Outlook”.

- 2 -1. Summary of Operating Results, etc.
(1) Summary of operating results for the year ended March 2017
During the year ended March 31, 2017, the Japanese economy continued to show a gradual recovery under the continued
monetary easing by the Bank of Japan and corporate earnings improved. After the U.S. presidential election, thedepreciation of yen against dollar continued and stock prices in Japan also showed an upward trend. However, there areconcerns about the impact on Japanese economy due to increasing global uncertainties including concerns over the possible
changes in economic and diplomatic policies in the U.S., fluctuations in interest rates and exchange rates, the future
development of the Brexit negotiation, and the repeated terrorist attacks and rising tensions in Syria and Korean Peninsula.
In the aviation industry, an increase of inbound demand in international flight continued, and a demand for domestic
flight slightly increased. On the other hand, there are concerns over a rise in fuel costs due to risks of an increase in crude
oil prices as a result of OPEC’s crude-output cuts since the start of 2017 and changes in global situation, coupled with thedepreciation of yen. Also, as competition with LCCs having increased market presence and Shinkansen has become
increasingly fierce, airline companies are working on further cost reduction while implementing advanced equipment andexpanding network.
Under such economic conditions, the Group (the Company and its consolidated subsidiaries) recorded net sales of¥21,662 million (up 4.6% from the previous fiscal year) due to an improved occupancy ratio in tenants and cost reductionof electricity and gas, operating income of ¥3,825 million (up 29.9%), ordinary income of ¥3,492 million (up 10.0%), andprofit attributable to owners of parent of ¥2,151 million (up 11.1%).
Performance by business segment is as follows:(i) Real Estate Business
Real Estate Business recorded net sales of ¥16,131 million (up 5.3% from the previous fiscal year), due to an
improved occupancy ratio of tenants around Tokyo International Airport and Kansai International Airport, opening ofHaneda Asahi Cho Hotel, and increased sales of a consolidated subsidiary in Singapore. Operating income was¥2,560 million (up 26.6%).
(ii) Area Heating & Cooling Business
Area Heating & Cooling Business recorded net sales of ¥3,200 million (up 1.0% from the previous fiscal year) due
to a steady growth of sales from area heating & cooling service in the reclaimed land area offshore Tokyo
International Airport by Tokyo Airport Heating & Cooling Co., Ltd., a consolidated subsidiary. Operating income
was 1,143 million (up 37.6%) also due to decreased rates of electricity and gas.
(iii) Water Supply & Drainage Service and Other Business
Water Supply & Drainage Service and Other Business recorded net sales of ¥2,330 million (up 4.9% from theprevious fiscal year) as a result of a solid growth in sales of water supply and drainage usage due to a growing
number of passengers at Tokyo International Airport and the operation of solar power plant in Mizunami, Gifu.
Operating income was ¥122 million (up 32.3%).
(2) Summary of financial position as of March 31, 2017
(Assets)
Total assets as of March 31, 2017 amounted to ¥87,580 million, an increase by ¥2,365 million compared to March 31,
2016, due to an increase in leased assets of a subsidiary in Singapore.
(Liabilities)
Liabilities as of March 31, 2017 amounted to ¥34,165 million, an increase by ¥594 million from March 31, 2016, due to anincrease in guarantee deposits received from new tenants.
(Net assets)
Net assets as of March 31, 2017 increased by ¥1,770 million compared to March 31, 2016 to ¥53,415 million mainly due toan increase in retained earnings.
As a result, equity ratio as of March 31, 2017 increased by 0.2 points to 58.7% compared to March 31, 2016.

- 3 -(3) Summary of cash flows for the fiscal year ended March 31, 2017
Cash and cash equivalents (“cash”) as of March 31, 2017 amounted to ¥5,713 million, a decrease of ¥260 million fromMarch 31, 2016.
(Cash flows from operating activities)
Net cash provided by operating activities was ¥3,024 million (previous fiscal year: ¥809 million provided), attributable
to an increase in income before income taxes and a decrease in operating loans.
(Cash flows from investing activities)
Net cash used in investing activities was ¥3,048 million (previous fiscal year: ¥2,453 million used), attributable to anincrease in purchase of noncurrent assets.
(Cash flows from financing activities)
Net cash used in financing activities was ¥137 million (previous fiscal year: ¥1,731 million provided), mainly
attributable to payments of long-term debt.
(Reference) Cash Flow Indicators
FY2015/3

FY2016/3

FY2017/3

Equity ratio (%)

58.3

58.5

58.7

Equity ratio at market value (%)

43.9

32.8

35.2

Debt repayment period (years)

6.6

29.6

7.9

Interest coverage ratio (times)

11.4

2.5

8.3

Equity ratio: Equity capital / Total assets
Equity ratio at market value: Market capitalization / Total assets
Debt repayment period: Interest-bearing debt / Operating cash flows
Interest coverage ratio: Operating cash flows / Interest expense(Notes)1. All indicators are calculated using financial figures on a consolidated basis.
2. Interest-bearing debt includes all debt recorded on the consolidated balance sheets on which interest ispaid.
3. Operating cash flows and interest expense are based on “Cash flows from operating activities” and“Interest paid” presented on the consolidated statement of cash flows.
4. Debt repayment period of 29.6 years for the fiscal year ended March 31, 2016 was due to a decrease inoperating cash flows as a result of operating loans extended by an overseas consolidated subsidiary.

(4) Future Outlook
With factors including an increase in tenant occupancy ratio at Tokyo International Airport, as well as hangars at
Kitakyushu Airport and Sendai Airport scheduled to begin operation and an addition of water supply and drainage services
business at New Chitose Airport, the forecast for the fiscal year ending March 31, 2018 is net sales of ¥22,180 million (up2.3% from the previous fiscal year), operating income of ¥3,860 million (up 0.9%), ordinary income of ¥3,640 million (up4.2%), and profit attributable to owners of parent of ¥2,310 million (up 7.3%).
The above forecast is based on available information as of the date this report was released and actual results may differ
from these forecasts depending on various factors.
(5) Progress Status of the Medium-term Management Plan
For the year ended March 31, 2017, the first year of Medium-term Management Plan developed in October 2016, net sales
increased 0.1% from the initial plan, almost in line with the plan, but operating income increased 7.7%, ordinary income
increased 4.8% and net income increased 0.5%, slightly exceeding the Medium-term Management Plan due mainly tocontinued reduction in electricity and gas costs.

- 4 -From the year ending March 31, 2018 onward, sales and profit are expected to slightly exceed the Medium-termManagement Plan due to new plans not included in the Medium-term Management Plan such as water supply and drainage
services business at New Chitose Airport, etc.
(6) Basic Policy Regarding Distribution of Earnings and Dividends for the Year Ended March 31, 2017 and the YearEnding March 31, 2018
We plan distribution of earnings taking into consideration maintenance of stable management base and enhancement offinancial strength, and our dividend policy is to stably return profits to shareholders based on the comprehensive
consideration over the current performance and future outlook, with the dividend payout ratio of over 30% in principle.
The dividend for the year ended March 31, 2017 was planned to be ¥12 per share at the beginning of the fiscal year, but
based on the above policy and the performance, it is expected to be ¥13 per share consisting of interim dividend of ¥6 pershare and year-end dividend of ¥7 per share. The dividend for the next fiscal year is expected to be ¥14 per share (includinginterim dividend of ¥7 per share).

2. Basic Policy Regarding Selection of Accounting Standards
The Group adopts Japanese Accounting Standards to ensure comparability with domestic sector peers.

- 5 -3. Consolidated Financial Statements and Major Notes(1) Consolidated Balance Sheets(Thousands of yen)
FY3/16(As of March 31, 2016)

FY3/17(As of March 31, 2017)

AssetsCurrent assets
Cash and deposits

4,974,638

3,713,841

Notes and accounts receivable-trade

1,006,211

1,105,796

Securities

1,000,000

2,000,000

Lease receivables and investment assets

3,874,634

5,613,569

Operating loans

5,392,481

6,409,607

Raw materials and supplies

13,083

13,469Deferred tax assets

165,175

137,464

Others141,027

222,372

16,567,252

19,216,120

152,471,802

155,997,336(107,361,515)(110,216,294)

Buildings and structures, net

45,110,286

45,781,042

Machinery, equipment and vehicles

16,746,614

17,015,488(11,693,470)(12,207,945)

5,053,144

4,807,542

Total current assets
Noncurrent assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation and impairment loss

Accumulated depreciation
Machinery, equipment and vehicles, net
Tools, furniture and fixtures

257,079

285,405

Accumulated depreciation(218,169)(231,204)

38,91054,200Land

9,592,528

9,659,676

Construction in progress

1,562,242

592,925

Total property, plant and equipment

61,357,112

60,895,387

25,06430,411

5,976,316

6,242,057

Tools, furniture and fixtures, net

Intangible assets
Investments and other assets
Investment securities
Long-term loans receivable

3,429

2,823

Deferred tax assets

468,895

407,807

Net defined benefit asset

198,997

178,133

Others652,251

641,941

Allowance for doubtful accounts(34,567)(34,567)

Total investments and other assets

7,265,322

7,438,196

Total noncurrent assets

68,647,500

68,363,995

85,214,753

87,580,116

Total assets- 6 -(Thousands of yen)
FY3/16(As of March 31, 2016)

FY3/17(As of March 31, 2017)

Liabilities
Current liabilities
Notes and accounts payable-trade

1,114,793

952,151

Short-term loans payable

4,379,428

4,491,774

Accounts payable

519,280

630,096

Income taxes payable

488,020753,798

Accrued expenses

269,075

82,989Unearned revenue

948,317943,936

Provision for bonuses

131,496

128,380

Provision for directors’ bonuses

25,88024,297

Provision for removal cost of property, plant and equipment

223,321

28,913

Others363,151

519,819

8,462,765

8,556,157

Long-term loans payable

19,621,404

19,502,373

Long-term guarantee deposited

5,083,361

5,402,001

Long-term accounts payable

394,749

345,169

Total current liabilities
Noncurrent liabilities

Net defined benefit liability

5,370

－

Provision for directors’ retirement benefits

2,436

1,044

－

358,325

25,107,322

25,608,913

33,570,088

34,165,070

Capital stock

6,826,100

6,826,100

Capital surplus

6,982,920

6,983,993

Retained earnings

35,418,621

36,949,740

Treasury stock(1,562,688)(1,559,198)

Total shareholders’ equity

47,664,953

49,200,635

Valuation difference on available-for-sale securities

2,234,058

2,418,429

Foreign currency translation adjustment(10,292)(181,790)

Total accumulated other comprehensive income

2,223,766

2,236,639

Subscription rights to shares

29,35955,022

Non-controlling interests

1,726,586

1,922,748

Total net assets

51,644,665

53,415,045

85,214,753

87,580,116

Provision for removal cost of property, plant and equipment
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders’ equity

Accumulated other comprehensive income

Total liabilities and net assets- 7 -(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income(Consolidated Statements of Income)(Thousands of yen)
FY3/16(April 1, 2015 –March 31, 2016)

FY3/17(April 1, 2016 –March 31, 2017)

Net sales
Cost of sales

20,697,667
16,073,629

21,662,319
16,064,434

Gross profit
Selling, general, and administrative expenses
Directors’ compensations
Salaries and bonuses
Provision for bonuses
Provision for directors’ bonuses
Transportation and communication expenses
Depreciation
Taxes and dues
OthersTotal selling, general, and administrative expenses
Operating income
Non-operating income
Interest income
Dividends income
Commission fee
Foreign exchange gains
Others4,624,037

5,597,884

268,263494,208
80,321
25,88098,635
18,233
94,646599,640
1,679,828
2,944,208

297,555495,766
71,97324,297
108,620
7,712
174,396592,456
1,772,777
3,825,107

207
121,063442,465
1,043
130,1512
142,260
61,82887,027
178,084

Total non-operating income
Non-operating expenses
Interest expenses
Removal cost of property, plant and equipment
Provision for removal cost
Depreciation
Others694,932

469,203319,291
62,695
9,515
72,9881,332

357,464
74,330369,463－711

465,823
3,173,316

801,969
3,492,342

125,009－

125,009－

7,516
12,609931－

Total extraordinary loss
Income before income taxes
Income taxes
Income taxes - deferred

20,125
3,278,200
846,312309,100

931
3,491,411
1,098,398
7,429

Total income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

1,155,412
2,122,787
187,353
1,935,434

1,105,828
2,385,583
234,491
2,151,091

Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of noncurrent assets
Total extraordinary income
Extraordinary loss
Loss on retirement of noncurrent assets
Loss on sales of non-current assets- 8 -(Consolidated statements of comprehensive income)(Thousands of yen)
FY3/16(April 1, 2015 –March 31, 2016)

FY3/17(April 1, 2016 –March 31, 2017)

2,122,787

2,385,583

ProfitOther comprehensive income
Valuation difference on available-for-sale securities(484,489)

184,370

Foreign currency translation adjustment(79,875)(171,497)

Total other comprehensive income(564,365)

12,873

1,558,422

2,398,456

1,371,069

2,163,964

187,353

234,491

Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of the parent
Comprehensive income attributable to non-controllinginterests- 9 -(3) Consolidated Statements of Changes in Net Assets
For the Year ended March 31, 2016 (April 1, 2015 to March 31, 2016)(Thousands of yen)

Shareholders’equity

Capital stock

Balance at the beginning of current period

Capital surplus

6,826,100

Retainedearnings

6,982,920

Treasury stock

Total
shareholder'sequity(1,562,347)

46,349,794

34,103,121

Changes of items during the period
Dividends from surplus(619,933)(619,933)

Profit attributable to owners of parent

1,935,434

1,935,434

Purchase of treasury stock

(341)

－

Net changes of items other than shareholders’ equity－－

1,315,500(341)

1,315,159

6,826,100

6,982,920

35,418,621(1,562,688)

47,664,953

Subscription
rights toshares

Noncontrollinginterests

Total
net assets－

1,577,561

50,715,488

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

(341)
－

Disposal of treasury stock

Accumulated othercomprehensive income

Balance at the beginning of current period

Valuationdifference on
available-forsale securities

Foreigncurrencytranslation
adjustment

2,718,548

69,583

Total
accumulated
othercomprehensive
income2,788,131

Changes of items during the period
Dividends from surplus－(619,933)

Profit attributable to owners of parent－

1,935,434

Purchase of treasury stock

－

(341)

－

Disposal of treasury stock
Net changes of items other than shareholders’ equity(484,489)(79,875)

Total changes of items during the period(484,489)

Balance at the end of current period

2,234,058－(564,365)

29,359(79,875)(564,365)

29,359149,024

929,177(10,292)

2,223,766

29,3591,726,586

51,644,665- 10 -

149,024(385,981)

For the Year ended March 31, 2017 (April 1, 2016 to March 31, 2017)(Thousands of yen)

Shareholders’equity

Capital stock

Balance at the beginning of current period

Capital surplus

6,826,100

Retainedearnings

6,982,920

Treasury stock

Total
shareholder'sequity(1,562,688)

47,664,953

35,418,621

Changes of items during the period
Dividends from surplus(619,972)

Profit attributable to owners of parent

2,151,091

Purchase of treasury stock
Disposal of treasury stock

1,072(619,972)
2,151,091
(54)

(54)

3,544

4,617

Net changes of items other than shareholders’ equity
－

1,072

1,531,119

3,490

1,535,681

6,826,100

6,983,993

36,949,740(1,559,198)

49,200,635

Subscription
rights toshares

Noncontrollinginterests

Total
net assets

29,3591,726,586

51,644,665

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

Accumulated othercomprehensive income
Valuationdifference on
available-forsale securities
Balance at the beginning of current period

2,234,058

Total
accumulated
othercomprehensive
income(10,292)
2,223,766

Foreigncurrencytranslation
adjustment

Changes of items during the period
Dividends from surplus(619,972)

Profit attributable to owners of parent

2,151,091

Purchase of treasury stock(54)

Disposal of treasury stock

4,617

Net changes of items other than shareholders’ equity

184,370(171,497)

12,873

25,663

196,162

234,698

Total changes of items during the period

184,370(171,497)

12,873

25,663

196,1621,770,380

2,418,429(181,790)

2,236,639

55,022

1,922,748

53,415,045

Balance at the end of current period- 11 -

(4) Consolidated Statements of Cash Flows(Thousands of yen)
FY3/16(April 1, 2015 –March 31, 2016)
Cash flows from operating activities
Income before income taxes

FY3/17(April 1, 2016 –March 31, 2017)

3,278,200

3,491,411

Depreciation and amortization
Increase (decrease) in provision for removal cost of
property, plant and equipment
Increase (decrease) in provision for retirement benefits

3,551,381

3,503,898(267,670)

163,917

2,225(5,370)Decrease (increase) in net defined benefit asset
Increase (decrease) in provision for directors’
retirement benefits
Increase (decrease) in provision for bonuses(18,315)

20,864(204,695)(1,392)

10,015(3,116)

Increase (decrease) in provision for directors’ bonuses

84(1,583)

Increase (decrease) in allowance for doubtful accounts(81,381)Interest and dividend income(121,089)－(142,262)

Share-based compensation expenses

29,35930,232

Interest expenses

319,291

357,464

Interest on securities

(181)

(1)

Loss on disposal of property, plant and equipment

7,516

931

Loss (gain) on sales of noncurrent assets(112,399)

Decrease (increase) in notes and accounts receivable

233,280－(97,459)

Decrease (increase) in inventories
Net decrease (increase) in lease receivables andinvestment assets
Decrease (increase) in operating loans receivable

10,312(386)

2,759,173(1,758,462)(5,565,515)(1,286,674)

Increase (decrease) in notes and accounts payable

116,222(162,641)

Increase (decrease) in unearned revenue

187,663

3,184

Increase (decrease) in accrued expenses(529,136)(174,723)

Increase (decrease) in accrued consumption taxes(626,466)

13,822

Decrease (increase) in other assets(798,572)(71,042)

Increase (decrease) in other liabilities(189,787)

160,703

Subtotal

1,989,512

4,041,315

Interest and dividends received
Interest paid

121,271(322,214)

142,263(368,827)

Income taxes paid

(979,100)(789,988)

Net cash provided by operating activities

809,469

3,024,762

Cash flows from investing activities
Purchase of noncurrent assets(3,476,107)(3,048,752)

Purchase of investment securities(10,000)－
606

Collection of long-term loans receivable

737

Proceeds from sales of noncurrent assets

1,032,116－(2,453,253)(3,048,146)

Net cash used in investing activities- 12 -

(Thousands of yen)
FY3/16(April 1, 2015 –March 31, 2016)

FY3/17(April 1, 2016 –March 31, 2017)

Increase in short-term loans payable

3,890,491

3,600,000

Decrease in short-term loans payable(4,863,515)(3,600,000)

Proceeds from long-term debt

6,156,389

3,121,349

Payments of long-term debt

Cash flows from financing activities(3,063,024)(2,916,644)

Proceeds from guarantee deposits received

366,620432,562

Repayments of guarantee deposits received(97,386)(116,312)－

47

Proceeds from sales of treasury stock
Purchase of treasury stock

(341)

(54)

Payment of cash dividends(619,717)(619,631)

Cash dividends paid to non-controlling interests(38,329)(38,329)

Net cash used in financing activities

1,731,186(137,011)(4,166)(100,401)

Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents

83,236(260,797)

Cash and cash equivalents at beginning of period

5,891,402

5,974,638

Cash and cash equivalents at end of period

5,974,638

5,713,841- 13 -

(Segment Information)a. Segment information
1. Overview of reportable segments
The reportable segments of the Company are units for which separate financial information is available and whose operating
results are regularly reviewed by the Board of Directors in order to decide how to allocate management resources andevaluate their performances.
The Company’s head office develops comprehensive business strategies of each segment and pursues business activities.
The Company is, therefore, composed of three business segments with different services determined by the head office asfollows: “Real Estate Business,” “Area Heating & Cooling Business”, and “Water Supply & Drainage Service and Other
Business.”“Real Estate Business” leases office buildings, “Area Heating & Cooling Business” supplies cooling and heating services,and “Water Supply & Drainage Service and Other Business” operate and manage waterworks, drainage, and sharedtelecommunications network business.
2. Method of calculations of sales, profit (loss), assets, liabilities, and other items by reportable segments
Accounting treatments applied to reportable segments are, in general, consistent with those described in “Significant Basis for
Preparation of Consolidated Financial Statements.”
Inventories are valued at amount before write-off of book value to reflect decline in profitability.
Segment income is based on operating income.
Intersegment sales and transfers are based on prevailing market price.
3. Sales, profit (loss), assets, liabilities, and other items by reportable segments
Fiscal year ended March 2016 (April 1, 2015 – March 31, 2016)(Thousands of yen)
Reportable segment
Water Supply &Area Heating &Real Estate
Drainage
Cooling
Business
Service andBusiness
Other Business

Total

Adjustments(Note)

Carrying amounton consolidated
statements ofincomeNet sales
Net sales to outside
customers

15,311,763

3,166,273

2,219,630

20,697,667－

20,697,667

Inter-segment
net sales/transfers

218,365

842,607

225,313

1,286,286(1,286,286)－

15,530,129

4,008,880

2,444,943

21,983,953(1,286,286)

20,697,667

Segment income

2,021,510

830,501

92,1972,944,208－

2,944,208

Segment assets

64,219,611

6,264,201

1,615,193

72,099,007

13,115,746

85,214,753

Segment liabilities

7,666,599

564,773

156,041

8,387,414

25,182,673

33,570,088

Depreciation andamortization

2,753,233

544,596

162,330

3,460,159

18,2333,478,393

Increase in property, plantand equipment andintangible assets

2,203,179

259,488508,889

2,971,556

2,192

2,973,748

Total

Other items(Note) Adjustments represent elimination of intersegment transactions.

- 14 -

Fiscal year ended March 2017 (April 1, 2016 – March 31, 2017)(Thousands of yen)
Reportable segment
Area Heating &Real Estate
Cooling
Business
Business

Water Supply &Drainage
Service andOther Business

Total

Adjustments(Note)

Carrying amounton consolidated
statements ofincomeNet sales
Net sales to outside
customers

16,131,968

3,200,254

2,330,096

21,662,319

Inter-segment
net sales/transfers

220,631856,363

244,062

1,321,057(1,321,057)

16,352,600

4,056,618

2,574,158

22,983,377(1,321,057)

Segment income

2,560,035

1,143,033

122,039

3,825,107

Segment assets

66,928,371

6,114,395

1,444,185

74,486,952

13,093,163

87,580,116

Segment liabilities

8,013,201

331,441

143,7888,488,431

25,676,639

34,165,070

Depreciation andamortization

2,746,652

547,975

201,558

3,496,186

7,712

3,503,898

Increase in property, plantand equipment andintangible assets

2,596,585

397,704

27,816

3,022,105

26,345

3,048,450

Total

21,662,319

21,662,319
3,825,107

Other items(Note) Adjustments represent elimination of intersegment transactions.

- 15 -