FY Ending February 2019 (FY 2/19),
Second Quarter (2Q) Presentation

October 3, 2018

Tokyo Individualized Educational Institute, Inc.
(TSE 1st Section, Securities Code 4745)
Katsuki Saito, President and Representative Director

Agenda① First Half (1H) Highlights② Initiatives for Sustained Growth2

FY 2/19

First Half (1H) Highlights
Takeharu Tsutsumi
Executive Officer,
Corporate Strategy & Finance/Accounting Officer
Tokyo Individualized Educational Institute, Inc.

4

Net Sales

Currently Setting a New Record High,000

9,470

1H Net Sales

8,918,000

7,906
7,354,000,000

8,2946,688

Net Sales increased

6.2％,000,000

compared with the,000

same period of the,000

previous fiscal year,000,000

0FY 2/14FY 2/15FY 2/16

FY 2/17

FY 2/18

FY 2/19(Millions of yen)5

Seventh Consecutive Year of Increases in Number of Students Enrolled/Currently Setting a New Record High

Well-Balanced Growth across All Segments
1H Average Number of Students (by Grade Level)

30,541
28,49526,94023,921

25,40322,281

11,075

12,09013,05814,506

15,435

16,538（54.2％）
Highschool
students

Juniorhighschool
students

10,753（35.2％）

8,803

9,288

9,743

9,834

10,283

2,403

2,543

2,602

2,600

2,776

3,251 （10.6％）

FY 2/14FY 2/15FY 2/16

FY 2/17

FY 2/18

FY 2/19

Elementaryschoolstudents

Growth in 1H Enrollment (Compared with the Same Period of the Previous Fiscal Year):High school students +7.1%, Junior high school students +4.6%, Elementary school students +17.1%
Note: Number of students enrolled in individualized instruction

6

Number of New Students

Contribution to New Record High Enrollment
Cumulative Number of New Students in 1H

18,141

16,84014,440
12,352

15,362

Number of New Students

12,987increased

7.7％

compared with thesame period of theprevious fiscal year

Achieved arecord highFY 2/14FY 2/15FY 2/16

FY 2/17

FY 2/18

FY 2/19 (Persons)Note: Number of new students in individualized instruction only7

Number of Inquiries

Generating Inquiries Due to a
Consistent Communications Strategy

0

Cumulative Number of Inquiries in 1H
46,7150

Number of Inquiries

41,90737,8920051,264

increased

32,054

9.7％

compared with thesame period of theprevious fiscal year

28,5120Achieved a0

record high0

FY 2/14FY 2/15FY 2/16

FY 2/17

FY 2/18

FY 2/19 (Persons)Note: Number of inquiries for individualized instruction only8More Efficient Deployment of Advertising Expenses

Efficient Expansion of Points of Customer Contact
Due to Dominance Strategy and Media Shift
1H Advertising Expenses/Ratio of Advertising Expenses to Net Sales
1,800

1,600

26.0%

1,587
1,487

1,578
24.0%

1,462

1,411

1,410

1,400

22.0%

22.2%
1,200
20.0%

19.9%

1,000

20.1%
19.0%

18.0%

800
16.0%
600

15.8%
14.9%40014.0%

12.0%200010.0%
FY 2/14FY 2/15FY 2/16

FY 2/17

FY 2/18

FY 2/19(Millions of yen)9

Highlights Compared with the Same Period of the Previous Fiscal YearFY 2/19 1H Results(Compared with the Same Period of the Previous Fiscal Year)(Millions of yen)

FY 2/18 1HResults

FY 2/19 1HResults

Change%ChangeNet sales

8,918

9,470

551

＋6.2%

Cost of sales

5,702

6,113

410＋7.2%

Cost of sales ratio

63.9%

64.6%

--Gross profit

3,216

3,357140＋4.4%

Gross profit margin

36.1%

35.4%

--

SG&A expenses

2,754

2,778

23＋0.9%

SG&A expenses ratio

30.9%

29.3%

--

Operating income

461

578

116

＋25.3%

5.2%

6.1%

--

462

580

117

＋25.4%

5.2%

6.1%

--

274

421

147

＋53.7%

3.1%

4.5%

-

-

Operating income margin

Ordinary income
Ordinary income margin

Net income
Net income margin10Balance Sheet/Cash Flow Statement(Millions of yen)

Current assets
Fixed assets
Total assets
Current liabilities
Long-term liabilities
Total liabilities
Total net assets
Total liabilities and net assets

February 28, 2018
Results
8,936
2,477
11,414
2,822
5
2,828
8,585
11,414

August 31, 2018
Results
8,777
2,478
11,256
2,951
3
2,954
8,301
11,256(Millions of yen)

Operating cash flow

FY 2/18 1H
Results（665）

FY 2/19 1H
Results（403）

Investment cash flow

（152）

（183）

Financing cash flow

（706）

（705）

（1,524）（1,292）

Cash & cash equivalents at beginning of year

7,207

7,773

Cash & cash equivalents at end of period

5,683

6,481

Increase (decrease) in cash & cash equivalents

11Overview of FY 2/19 1H Results (Compared with the Same Period of the Previous Fiscal Year)

Stable and Sustained Business Growth¥551 million increase compared with the same period of theprevious fiscal year
Netsales Numbers of inquiries and new students both grew steadily, with a increase in
the number of students enrolled Summer course sales also grew steadily¥116 million increase compared with the same period of theprevious fiscal year
OperatingincomeNet
income Increase in income due to increased sales from growth in enrollment
 Invested in capacity expansion, including new school openings and existingschool relocations/expansions
 Invested in people, including teacher training and increase in part-timeclerical staff¥147 million increase compared with the same period of theprevious fiscal year Increase in income due to tax refund from the application of tax credits forsalary growth12Achieve sustained business growth by refining hospitalitycentered human resource development methods
GrowthStrategy① Systematize human resource development

GrowthStrategy②

Continue opening dominant schools

GrowthStrategy③

Develop new services
Build a stronger, more efficient operating foundation
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TEACHERS’ SUMMIT ACADEMY
Leadership Program
TEACHERS’ SUMMIT ACADEMY
Leadership Program Agenda

１

Leadership/Communication２

Backcasting approach３

Coaching skills

４

Grit (Perseverance)

５

Presentation skills

６

Graduation presentation
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TEACHERS’ SUMMIT ACADEMY Held Nationwide

Last year, the TEACHERS’ SUMMITACADEMY was held mainly in theTokyo metropolitan area. This year, it isbeing held nationwide.
Last time there were about 60
participants, and this time we havedoubled the admission capacity tocreate learning opportunities for moreteachers.

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7 New School Openings Decided
FY 2/19

New School Openings3新規開校数
New schools

5

Already OpenNaka-Meguro School（Tokyo）
March 2018

Schools at start of FY
期首教室数

10Shin-Okachimachi School（Tokyo）
March 2018

5225

240

Nishi-Funabashi School（Chiba）
March 2018230

Suita School（Osaka）
May 2018

FY 2/17(Actual)

FY 2/18(Actual)

FY 2/19(Plan)

Schools at
start of FY

225230240New schools

5108

Schools at endof FY

230

240

248

Musashi-Koyama School（Tokyo）
June 2018

Scheduled to Open
Sasazuka School（Tokyo）
November 2018

Shin-Kawasaki School（Kanagawa）
December 201816

4EST to Be Introduced at All Schools in November

17Preparing for a Regular Course in Programming
Held Free Trial Classes

Concept

Trial classes

Improve ability to think like aprogrammer, solve problems andcollaborate through classes in which
students form groups to consider,discuss and present their results.
18Support for Diverse Employee Working Styles

Banking Paid Vacation Days and Reduced
Working Hours System for Nursing/Childcare
System for Banking Paid Vacation Days

We have introduced a system thatallows employees to bank up to 60
unused days of annual paid vacation
after they have expired. The system canbe used for childcare, nursing care, orhospitalization/outpatient treatment for
employee injury or illness.
The system provides support for
employees in choosing diverse working
styles according to their life stage.

Enhanced Reduced Working Hours
System for Nursing/Childcare

The period during which employees canuse the reduced working hours systemfor childcare has been significantly
extended from the current “children up
to 3 year old” to “children up to 10years old (fourth grade of elementaryschool).”
The time limit for use of the reduced
working hours system to provide family
nursing care has been removed, inprinciple.
Note: Employees can chose to work 4, 5, 6 or 7 hours
per working day.

19FY 2/19 Forecast

Full-Year Forecast Revised Upwardin Light of Solid Results
Previously
Announced
Forecast

Revised
Forecast(Millions of yen)

Increase/
Decrease% Increase/
Decrease

Net sales

19,80020,100+300+1.5%Operating income

2,700

2,730

+30+1.1%

Operating income
margin

13.6%

13.6%

±0.0%

-

Ordinary income

2,702

2,732+30+1.1%

Ordinary income
margin

13.6%

13.6%

±0.0%

-Net income

1,788

1,835+47+2.6%

9.0%

9.1%

+0.1%-32.93

33.80

+0.87

+2.6%

Net income margin
Earnings per share(Yen)Net sales:

Estimated based on number of students enrolled

Operating income: Slight increase in target due to focus on investments for growth such as
school openings, relocations and expansions, and comprehensive
hospitality training for teachers to provide high-quality services
2020

Highlights

External Evaluation■Selected as a constituent stock of theJPX-Nikkei Mid and Small Cap Index○ TIEI Results forMain Selection Criteria（TIEI survey）

 3-year average ROE: 18.6％
 6 consecutive years ofincreases in operating income
 2 independent outside directors■Selected as one of fifty candidates for the7th Corporate Value Improvement Award
Selected as a “listed company that adopts management practices aimed atincreasing corporate value from the vantage point of investor interests.”
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Initiatives for Sustained Growth
Katsuki Saito, President and Representative Director
Tokyo Individualized Educational Institute, Inc.

23

Number of Teachers

Steadily Increasing the Number of Teachers
Number of Teachers (As of August 31)
Note: Number of part-time employees including clerical staff

10,422
9,2776,9377,202

FY 2/15FY 2/16

8,1845,824

FY 2/14FY 2/17

FY 2/18

FY 2/19（Persons）
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Annual Schedule

26
Announcement of Regional Representative Schools
Departmental and individual awards, etc.

・ ・Final Briefing Select Regional Representative Schools

Best Practice

Kickoff Meeting

Prepare and announce plan

Midterm Briefing Share progress of annual plan

Winter course
Summercourse
Plan preparation

MarchJanuary
SeptemberMayTeacher Satisfaction: External Evaluation

High Evaluation for Teacher Job Satisfaction

TIEI and KIEI Prep School Teachers

Ranked First in 22 Items!

Note: Excerpt from “Survey of University Student Part-Time Workers”
Method: Internet survey (calculated based on a 100-point score for each item; number of questions: 25)
Survey subjects: 973 current student part-time workers continuously employed for 3 months or more
Survey period: January 17 to February 16, 2018
Source: Oricon ME Co., Ltd.

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Relevance to SDGs

Enabling Teachers to
Lead the Way to the Future
Initiatives

SDGs

Target 4.4

TEACHERS’SUMMITTEACHERS’SUMMIT
ACADEMYBy 2030, substantially increase the numberof youth and adults who have relevant
skills, including technical and vocational
skills, for employment, decent jobs andentrepreneurship

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Thank you for your attention today.

Forward-Looking Statements
These materials include forward-looking statements concerning future financial performance,
including business strategies and forecasts. Such statements are based on the Company’s
judgment at the time of publication, and include inherent risks and uncertainties. Thesestrategies and forecasts may be amended due to changes in the external environment or otherfactors.

IR Inquiries

Management Strategy Office, IR

Phone: +81-3-6911-3216

E-mail: ir@tkg-jp.com
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