FY3/14 Financial Statements [J-GAAP]May 12, 2014
Company Name:
Matsuda Sangyo Co., Ltd.
Exchanges listed on: Tokyo Stock Exchange (First Section)
Company code: 7456
URL: http://www.matsuda-sangyo.co.jp
Representative: Representative Director/President
Yoshiaki Matsuda
Inquiries:
Director
Yoshitaka Tashiro
TEL: +81-3-5381-0728
Date of regular shareholders’ meeting:June 26, 2014
Date of filing the financial report
June 26, 2014
Expected dividend payment date:June 27, 2014
Supplementary materials for financial results prepared: Yes
Information meeting for financial results held: Yes (for institutional investors and analysts)(Figures are rounded down to the nearest million yen)
1. FY3/14 Consolidated results (April 1, 2013–March 31, 2014)(1) Consolidated operating results(Percentages are year-on-year changes)
Net Sales
Operating income
Ordinary income
Net income(millions of yen)(%)(millions of yen)(%)(millions of yen)

FY3/14
165,416-1.1
4,503 -19.1
FY3/13
167,263 -10.8
5,568 -18.6(Note) Comprehensive income: FY3/14 4,147 million yen (-9.9%)
Net income per
share(millions of yen)(%)

4,893 -19.6
3,192
6,085 -13.4
4,008
FY3/13 4,604 million yen (12.8%)

(%)

-20.3
-4.7

Diluted net income
Ordinary income /Return on equity
Operating margin
per share
total assets

(yen)

(yen)

(%)

(%)

FY3/14118.75―
6.9
FY3/13146.51―
9.4(Reference) Equity in earnings or losses of affiliates:
FY3/14 290 million yen

(%)

7.6
2.7
9.8
3.3
FY3/13 451 million yen(2) Consolidated financial position
Total assets

Shareholders’ equity
ratio

Net assets(millions of yen)(millions of yen)

FY3/14
66,398
FY3/13
63,136(Reference) Shareholders’ equity
FY3/1447,44944,46047,447 million yen

Net assets per share

(%)

(yen)

71.5
70.4
FY3/13

1,778.38
1,643.09
44,457 million yen(3) Consolidated cash flows
Cash flow fromoperating activities

Cash flow frominvesting activities

Cash flow fromfinancing activities

Cash and cash
equivalents at end of
period(millions of yen)(millions of yen)(millions of yen)(millions of yen)

-404
2,703

-803
-2,765-909-1,593

6,798
8,582

FY3/14
FY3/13
2. Dividends

Dividends per share
Q1
(yen)

FY3/13
FY3/14
FY3/15(projections)

Q2

Q3

(yen)

(yen)

Q4

AnnualTotal dividends Payout ratio Dividends/
net assets(consolidated)(annual)(consolidated)(yen)(yen) (millions of yen)

(%)

(%)

16.3
20.2

1.5
1.4

―
―

12.00
12.00

―
―

12.00
12.00

24.00
24.00

―

12.00

―

12.00

24.00

653
642

19.7

3. FY3/15 Consolidated earnings projections (April 1, 2014–March 31, 2015)
Net sales
1H FY3/15
FY3/15

Operating income(millions of yen)(%)

80,000170,000-4.6
2.8(millions of yen)

(Percentages are year-on-year changes)
Net income per
Ordinary income
Net incomeshare(%) (millions of yen)

2,150 -10.7
4,700 4.4(%)

(millions of yen)

2,300 -13.7
5,000 2.2

(%)

(yen)

1,500 -13.6
3,270 2.4

55.78
121.62* Notes(1) Material changes in subsidiaries during the fiscal year (changes in specified subsidiaries resulting fromchanges in scope of consolidation): No(2) Changes in accounting principles, changes in accounting estimates and restatement of revisions
1) Changes in accounting policies with revision of accounting standards:
Yes2) Changes in accounting policies other than the above:No3) Changes in accounting estimates:
No4) Restatement of revisions:No(3) Number of issued shares (common shares)
1) Number of issued shares(including treasury stock)2) Number of treasury stock3) Average number of shares during the period

FY3/14 28,908,581 shares FY3/13 28,908,581 shares
FY3/14 2,228,187 shares FY3/13 1,851,230 shares
FY3/14 26,886,763 shares FY3/13 27,356,932 shares(Reference) Summary of non-consolidated results
1. FY3/14 Non-consolidated results (April 1, 2013–March 31, 2014)(1) Non-consolidated operating results
Net sales
Operating income
FY3/14
FY3/13(Percentages are year-on-year changes)
Ordinary income
Net income(millions of yen)(%)(millions of yen)(%)(millions of yen)(%)(millions of yen)(%)

162,997
165,755

-1.7
-10.7

3,695
4,550

-18.8
-27.0

3,955
4,933

-19.8
-19.0

2,483
3,097

-19.8
-11.1

Net income per share
FY3/14
FY3/13

Diluted net income
per share

(yen)

(yen)

92.35
113.23––(2) Non-consolidated financial position
Total assets
FY3/14
FY3/13

Net assets

Shareholders’ equity
ratio

Net assets per share(millions of yen)(millions of yen)

(%)

(yen)

60,35758,354

41,33339,95768.5
68.5

1,549.21
1,476.77(Reference) Shareholders’ equity:

FY3/14

41,333 million yen

FY3/1339,957 million yen*Presentation of implementation status for audit procedures
The audit procedure based on the Financial Instruments and Exchange Act does not apply to this report. At thetime of disclosure of this report, audit procedures for financial statements pursuant to the Financial Instruments andExchange Act had not been completed.
*Explanation of the proper use of earnings projections and other notes
This document contains earnings projections and other information that constitute forward-looking statements.
These statements are based on reasonable assumptions and information currently available to the Company andprovide no guarantee of future performance. Actual results may differ materially to forward-looking statements due toa number of factors. For more information about earnings projections assumptions and notes regarding the use of
earnings projections, please refer to “1. Operating results (1) Analysis of operating results and financial position” onpage 2.

Contents
1. Operating results ............................................................................................................................... 2(1) Analysis of operating results and financial position ...................................................................... 2(2) Analysis of financial position ......................................................................................................... 3(3) Basic policy on distribution of profits and dividends for FY3/14 and FY3/15 ............................... 4(4) Business and other risks............................................................................................................... 5

2. Corporate group............................................................................................................................... 6
3. Management policy ......................................................................................................................... 7(1) Basic corporate management policy ............................................................................................ 7(2) Business indicators used as benchmarks .................................................................................... 7(3) Medium- to long-term business strategy and issues faced by the Group .................................... 7(4) Other important corporate management issues ........................................................................... 7
4. Consolidated financial statements ................................................................................................ 8(1) Consolidated balance sheet ......................................................................................................... 8(2) Consolidated statements of income and comprehensive income .............................................. 10(3) Consolidated statements of changes in shareholders’ equity .................................................... 12(4) Consolidated statements of cash flow ........................................................................................ 14(5) Notes on consolidated financial statements ............................................................................... 15(Notes on premise of a going concern) ........................................................................................... 15(Changes in accounting standards, etc.) ......................................................................................... 15(Segment information, etc.) ............................................................................................................ 16

1

1. Operating results(1) Analysis of operating results and financial position
Consolidated operating results
Net sales
Operating income
Ordinary income
Net income(millions of yen) (year-on-year comparison)
165,416 (-1,847-1.1% )
4,503 (
-1,065-19.1% )4,893 (
-1,192-19.6% )3,192 (
-815
-20.3% )During the consolidated fiscal year ended March 31, 2014, the Japanese economy continued to recover at amoderate pace, supported by an upturn in consumer spending, corporate earnings and the labor market on the backof the government’s economic policies and yen depreciation. However, economic growth in Asia lost momentum.
Against this backdrop, Matsuda Sangyo Group’s precious metals business segment worked hard to secure
precision metals materials and boost sales of products such as precious metal chemical products. The segment also
actively upgraded business sites overseas and in Japan, which included the construction of a new plant in Iruma,
Saitama Prefecture, as part of efforts to renew precious metal recycling facilities. Overseas, the Group established a
new company in Vietnam to lead the construction of a new precious metals refining plant. The food business also
strengthened its overseas sites while working to secure sales volumes amid operating conditions that remained
challenging.
As a result, consolidated net sales decreased 1.1% year on year to 165,416 million yen, and operating income
decreased 19.1% to 4,503 million yen. Ordinary income was 4,893 million yen (down 19.6% year on year) and net
income was 3,192 million yen (down 20.3% year on year).
The following is a summary of business by segment:

Consolidated results by segment
Segment
Precious metals business
118,124segment
Food business segment
47,352Eliminations or corporate
-60
Total
165,416(millions of yen) (year on year comparison)
Operating income

Net sales(-6,812

-5.5%

)

3,717

(

-1,322-26.2%

)

(

4,972

11.7%

)

(

256

48.6%

)

(

-1,847

-1.1%

)

785
―
4,503

(

-1,065-19.1%)

Precious metals business segment
In the precious metals division, sales of platinum metal products increased, supported by a moderate recovery inproduction at key customers in the semiconductor and electronic parts sectors. However, sales as a whole in thedivision declined year on year due to weaker sales volume for gold and silver products and electronic materials.
In the environmental division, the volume of industrial waste handled by the Group increased. However, sales in thedivision declined year on year due to a drop in the volume of silver recovered from photosensitive materials.
As a result, net sales for the precious metals business segment decreased 5.5% year on year to 118,124 million
yen, and operating income decreased 26.2% year on year to 3,717 million yen.

2

Food business segment
The food business segment continued to face a challenging operating environment due to weak consumer
spending and a rise in raw material prices caused mainly by the weaker yen. Amid these conditions, the segment
worked to procure and sell stable supplies of safe, high-quality products to meet the demands of customers. Against
this backdrop, seafood products and livestock products registered increases in both sales volume and sales
compared with the previous fiscal year. Sales volume for agricultural products fell slightly year on year, but sales
increased.
As a result, net sales for the food business segment totaled 47,352 million yen (up 11.7% year on year) andoperating income decreased to 785 million yen (up 48.6% year on year).

Outlook for the fiscal year ending March 2015
Consolidated earnings projections
Net sales
Operating income
Ordinary income
Net income(millions of yen) (Comparison to FY3/14)
170,000 (+4,583+2.8% )
4,700 (
+196
+4.4% )
5,000 (
+106
+2.2% )
3,270 (
+77
+2.4% )

Although uncertainties remain, such as the risk of a slowdown in the global economy, we expect the Japanese
economy to enter a self-sustaining recovery, supported by the government’s fiscal and monetary policies. Against thisbackdrop, in the precious metals business segment, we plan to continue strengthening domestic and overseas
operating sites and increase business volume by cultivating new demand.
In the food business segment, we will work to generate steady earnings through aggressive marketing activities
tailored to customer needs, supported by the use of our overseas operating sites.

(2) Analysis of financial position
1) Assets, liabilities and net assets
AssetsTotal assets increased 3,262 million yen year on year to 66,398 million yen. This mainly reflected increases ininventories and property, plant and equipment, outweighing a decline in cash and deposits, and notes andaccounts receivable – trade.
Liabilities
Total liabilities increased 274 million yen year on year to 18,949 million yen. Chiefly, this is the result of anincrease in accounts payable－other, outweighing a decline in accrued income taxes.
Net assets
Net assets increased 2,988 million yen year on year to 47,449 million yen. This primarily reflected decreases due
to dividends paid and the purchase of treasury stock, outweighed by an increase from net income.

2) Cash flow status
As of March 31, 2014, the balance of cash and cash equivalents (hereafter, “cash”) stood at 6,798 million yen, adecrease of 1,784 million yen year on year. The followings are the cash flow status under review and the factors
during the fiscal period.
Cash flows from operating activities:
Operating activities used net cash of 404 million yen. This mainly reflected the difference between the increase
in income before income taxes on the one hand, and a corresponding increase in income taxes paid, a decrease innotes and accounts receivable – trade, and an increase in inventories on the other. The increase in inventories
was related to stock building due to the startup of a new plant. This represents a decrease of 3,108 million yen
from the 2,703 million yen increase in the previous fiscal year.

3Cash flows from investing activities:
Investing activities used net cash of 803 million yen. This was mainly due to the purchase of property, plant andequipment related to the installation and upgrade of equipment at the Group’s plants. Compared with theprevious fiscal year, when investing activities used net cash of 2,765 million yen, net cash used in investing
activities decreased by 1,961 million yen.
Cash flows from financing activities:
Financing activities used net cash of 909 million yen. This mainly reflected dividends paid and the purchase oftreasury stock. Compared with the previous fiscal year, when financing activities used net cash of 1,593 million yen,
net cash used in financing activities decreased by 684 million yen.
(Reference) Trend in cash flow indicators
FY3/10FY3/11

FY3/12

FY3/13

63.0
86.6
―
―

62.8
58.3
1.2
69.3

67.0
61.1
0.8
111.9

70.4
61.9
1.5
62.1

Shareholders’ equity ratio
Shareholders’ equity ratio on a market value basis
Ratio of interest-bearing debt to cash flow
Interest coverage ratio

FY3/14
71.5
50.0
―
―

(Notes) Shareholders’ equity ratio: Shareholders’ equity/total assets
Shareholders’ equity ratio on a market value basis: Total market value of shares/total assets
Ratio of interest-bearing debt to cash flow: Interest-bearing debt/cash flow from operating activities
Interest coverage ratio: Cash flows from operating activities/interest paid
* All the indicators are calculated using consolidated financial figures.
* The total market value of shares is calculated as the product of the share price and the number of issued shares at the end of the fiscal year.
* Cash flows from operating activities is the cash flows from operating activities appearing in the consolidated statements of cash flows.
Interest-bearing debt is the total amount of debt appearing in the consolidated balance sheet on which interest is paid. In addition,interest paid is the amount of interest paid appearing in the consolidated statements of cash flows.
* The ratio of interest-bearing debt to cash flow and the interest coverage ratio for FY3/10 and FY3/14 are not provided since cash flow fromoperatingactivities was negative.

(3) Basic policy on distribution of profits and dividends for FY3/14 and FY3/15
The Company’s basic policy on distribution of profits is to meet shareholders’ expectations by continuing to pay
stable dividends while ensuring sufficient internal reserves to invest in growth. In line with this policy, the Company
acquired treasury stock during the fiscal year under review in order to increase shareholder value per share.
Based on this policy, the Company plans to pay a year-end dividend of 12 yen per share. In combination with theinterim dividend of 12 yen, dividends for the full fiscal year are expected to be 24 yen per share.
The Company expects to pay 24 yen per share in dividends for the fiscal year ending March 2014 (12 yen per
share as an interim dividend, and 12 yen per share as a year-end dividend). The Company will continue to distributeprofits to its shareholders in a comprehensive way according to the operating results.

4(4) Business and other risks
The main business risks recognized by the Group are described below. If these risks become reality, they may
have a major effect on the Company’s business performance and financial position. In recognition of these risks, ourTRM (Total Risk Management) Committee will develop a risk management system with the aim of avoiding risks andminimizing the effect of such risks if they occur.
1) Price fluctuations for core products and commodities
a. Products
The Group’s products mainly consist of the precious metals such as gold, silver, platinum and palladium; the main
raw materials used in their production are the recycled raw materials containing the various precious metals. As ageneral rule, the purchase price is based on the market price for precious metal bullion and the market prices areaffected by changes in the international commodities market and fluctuation in exchange rates. The prices of theseproducts are also determined based on the market price. The Group employs commodity futures to avoid pricing risk
attendant to fluctuating prices, but it is possible that changes in the price of precious metals could affect its operating
results.
b. Commodities
A large portion of the Group’s processed raw materials for food products, which consist mainly of surimi fish pasteand other seafood, livestock products, and agricultural products, come from overseas. Both the purchase and sales
price of these products are affected by fluctuations in commodity market prices and exchange rates. The Groupaddresses these changes by using forward exchange contracts and passing on price changes to customers; however,these price changes could affect its operating results.

2) Quality issues related to the Group’s food business segment
The Group purchases a wide range of products from overseas for the food business segment, including processedseafood ingredients comprised mainly of surimi fish paste, shrimp, crab, squid ,octopus, processed agricultural
products comprised mainly of fresh, dried, and frozen vegetables, and processed livestock products comprised
mainly of various types of meat of beef, chicken and others, and chicken eggs. The Group also sells these products
to food manufacturers of surimi fish paste, frozen food, prepared food, confectionery and other food products on awholesale basis. The Group carries out strict labeling of food products as specified by law, and make every effort tostrengthen its quality control training and contamination countermeasures for overseas food products. However, its
operating results could be affected if food safety problems were to occur and measures such as a ban on imports
were imposed.

3) Addressing legal regulations
There is a trend towards stricter environmental laws as a result of growing societal concern over environmental
issues. If regulations of the precious metals business segment were tightened, various measures such as increasing
capital expenditures might become necessary. The Group also conducts various operations including collecting,transporting and disposing of waste as a business covered by the Waste Disposal and Public Cleaning Law, and thecontinuation of our business is based on the major assumption that the Group complies with the various laws.
In addition to establishing corporate ethics rules, which clearly state corporate ethics and legal compliance inwriting, the Group has created compliance rules to set forth how compliance is to be implemented, and is working toachieve compliance in all business activities.

4) Management of waste and other materials
The Group uses poisonous and toxic substances but appropriately processes the waste liquid and atmosphericemissions, taking the environment into consideration. However, operating results could be affected if a problem wereto occur with the management of these materials for any various reasons, including an accident at the plant.

52. Corporate group
Matsuda Sangyo Group is composed of the Company, 14 subsidiaries and 1 affiliated company; the main
businesses of the Group are the precious metals business segment, which involves the recovery and refining of
precious metals, the sale of items such as precious metal bullion and electronic materials, and the collection,transportation, and processing of industrial wastes; and the food business segment, which involves selling processedfood ingredients and providing distribution services. The following subsidiaries support the Company regarding
business for regions and industries related to the precious metals business segment: Matsuda Ecology. Co., Ltd.,
Japan Medical Technology Co., Ltd., Hokkaido Aoki Kagaku Co., Ltd., Z.E.R.O.-Japan, Co., Ltd., Matsuda Sangyo(Thailand) Co., Ltd., Matsuda Sangyo (Philippines) Corporation., South Gate Realty Holding Inc., Matsuda Sangyo(Singapore) Pte. Ltd., Matsuda Resource Recycling (Suzhou) Co., Ltd., Matsuda Sangyo (Malaysia) Sdn. Bhd., andMatsuda Sangyo (Vietnam) Co., Ltd. The subsidiary Matsuda Ryutsu Co., Ltd., is responsible for distribution for theCompany’s food business segment, while Matsuda Sangyo Trading (Qingdao) Co., Ltd. and Matsuda Sangyo Trading(Thailand) Co., Ltd. provide support for the food business segment in East Asia. The affiliated company Nippon
Micrometal Corporation handles the production of electronic materials, particularly gold bonding wires, the main
product for the precious metals business segment.
The following is an organizational chart of the business:(Notes)1. Affiliated companies are all accounted for under the equity method.
2. South Gate Realty Holding Inc. owns land of Matsuda Sangyo (Philippines) Corporation.

63. Management policy(1) Basic corporate management policy
Matsuda Sangyo Group’s corporate ethics are rooted in “making effective use of the earth’s resources andcontributing to society through business,” and the Group has developed its business on the three pillars: the precious
metals business, in working to recycle and make effective use of precious metals and limited resources; theenvironmental business, which aims to pass on a pristine environment to the next generation; and the food business,
which aims to provide stable food resources and the abundant bounty from the earth.
The Group’s basic management policy is to “focus on customers” and “focus on shareholders.” The Group sees its
path to growth as understanding customer needs precisely and working for mutual survival and prosperity with its
customers. The Group’s goal is to contribute to securing resources through its resource recycling business, tocontribute to the development of cutting-edge technology through precious metal processing and sales, to contributeto environmental protection though its environmental business, and to contribute to culinary life and culture through its
food business while striving to expand the scope of its business and earn reasonable profits through sustained
marketing efforts.
(2) Business indicators used as benchmarks
The Group has set the following numerical benchmarks for mid-term management: Ratio of ordinary income to total
assets of 10% or more and a shareholders’ equity ratio of 55% or more. As of the end of the fiscal year under review,the ratio of ordinary income to total assets was 7.6%, falling short of target, but the shareholders’ equity ratio was
71.5%, exceeding the target. In the future as well, the Group will continue to work earnestly to increase earnings andimprove operational efficiency.
(3) Medium- to long-term business strategy and issues faced by the GroupIn the medium to long term, the Group will deploy a strategy that has positioned the precious metals businesssegment as the driving force behind expansion and growth and the food business segment as a stable growthbusiness.
The following is a summary for each business segment:
Precious metals business segment:
In the precious metals division, we will boost earnings potential by strengthening products and services in response
to global competition. Aiming to become East Asia’s leading refining company, we will upgrade domestic operatingsites and reinforce our regional strategy for overseas sites.
In the fiscal year under review, we established a local company in Vietnam and made preparations to build a newplant with metal refining facilities. Also, in the Philippines, we purchased a new warehouse to boost precious metalmaterial collection capabilities at our local company. At all our local companies in Thailand, Singapore, Malaysia andChina (Suzhou), we plan to increase sales of products such as electronic materials and precious metal chemical
products and expand the collection of recyclable precious metals.
In Japan, we started operation of new refining facilities at a newly built plant in Iruma, Saitama Prefecture, in order
to boost quality and productivity. Going forward, we will continue to work on improving our precious metal recovery
technology and actively conduct R&D to develop new chemical products that address the needs of customers in theelectronics industry and other sectors.
In the environmental division, we will continue to leverage the Group’s waste acid and alkali treatment facilities,
nationwide waste disposal licenses and distribution network, while expanding the industrial fields we service in
response to changing demand.
Food business segment:
In the food products business segment, we will leverage the Group’s track record of expertise in quality assurance
to supply safe, reliable, high-quality food products, aiming to expand the business by standing out in the market andaddressing the changing needs of client industries. Against this backdrop, we will work to be more profitable byresponding to rising prices of imported raw materials caused by the yen’s weakness. We also intend to secure highquality supply sources and cultivate new customers by utilizing two overseas subsidiaries: Matsuda Sangyo Trading(Qingdao) Co., Ltd. in Qingdao, China, and Matsuda Sangyo Trading (Thailand) Co., Ltd. in Bangkok, Thailand.
(4) Other important corporate management issues
The Company engages in real estate lease transactions, non-life insurance transactions, and clerical work agency
with Matsuda Bussan, the Company’s main shareholder. The terms of the lease were determined in a fair manner bytaking into account the appraised value of the real estate as determined by a real estate appraiser and prices in theneighboring area. Payments of non-life insurance premiums are made based on the same terms that are commonlyused for insurance transactions.

74. Consolidated financial statements(1) Consolidated balance sheet(millions of yen)
FY3/13(March 31, 2013)

FY3/14(March 31, 2014)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable – trade
Merchandise and finished goods

8,587
18,813
8,596

6,798
16,482
12,828Work in process
Raw materials and supplies
Deferred tax assets
Other accounts receivable
OthersAllowance for doubtful accounts

174
5,729
595
1,132
1,750
-43

313
6,235
420
1,547
2,597
-43

Total current assets

45,33647,181

5,809-3,512

7,664-3,760

Buildings and structures, net

2,296

3,903

Machinery and delivery equipment
Accumulated depreciation

4,929-3,983

6,776-4,385

945

2,390

7,629
425
-306

7,773
264
-163

118

101

2,248
940
-622

126
997
-682

Fixed assets
Tangible fixed assets
Buildings and structures
Accumulated depreciation

Machinery and delivery equipment, net
Land
Leased assets
Accumulated depreciation
Leased assets, net
Construction in progress
Others
Accumulated depreciation
Others, net
Total tangible fixed assets
Intangible fixed assets
Others317

314

13,557

14,610329

215

Total intangible fixed assets

329

215

Investments and other assets
Investment securities
Deferred tax assets
Others

2,588
177
1,424

3,040
119
1,436

-277

-205

Allowance for doubtful accounts
Total investments and other assets

3,913

4,390

Total fixed assets

17,80019,216

63,136

66,398

Total assets

8

(millions of yen)
FY3/13(March 31, 2013)

FY3/14(March 31, 2014)

Liabilities
Current liabilities
Notes and accounts payable – trade
Short-term loans payable
Current portion of long-term loans payable
Lease obligations

7,885
721
714
54

8,095
1,347
623
47

Accrued income taxes
Reserve for bonuses
Other accounts payable
Others

1,315
615
1,169
2,867

579
623
2,258
2,278

Total current liabilities

15,34315,854

Fixed liabilities
Long-term loans payable
Lease obligations

2,467
64

2,244
53

230
539
30

596
156
44

Reserve for retirement benefits
Reserve for directors’ retirement benefits
Net defined benefit liability
OthersTotal fixed liabilities
Total liabilities
Net assets
Shareholders’ equity
Common stock
Capital surplus
Retained earnings

3,331

3,095

18,675

18,9493,559
4,008
38,766

3,559
4,008
41,311

Treasury stock-2,027-2,526

Total shareholders’ equity

44,30646,353

192

252

-22
-19
-

86
770
-14

Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Remeasurements of defined benefit plans
Foreign currency translation adjustments

151

1,094

Minority interests

Total accumulated other comprehensive income

2

1

Total net assets

44,46047,44963,136

66,398

Total liabilities and net assets

9(2) Consolidated statements of income and comprehensive income(Consolidated statements of income)
FY3/13(April 1, 2012 –March 31, 2013)
167,263
150,135
17,127
11,558
5,568(millions of yen)
FY3/14(April 1, 2013 –March 31, 2014)
165,416
149,689
15,726
11,222
4,503

3
20
451
24
62

6
23
290
17
60

69

-

6
43
681

189
70
42
699

43
34
59
27
165
6,085
6,085
2,038
39

43
143
59
64
310
4,893
4,893
1,518
185

Total income taxes

2,077

1,703

Income before minority interests

4,008

3,189

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividends income
Equity in earnings of affiliates
Purchase discounts
House rent income
Retirement payments received for transferred
employees
Insurance income
Subsidy income
OthersTotal non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Cost of lease revenue
OthersTotal non-operating expenses
Ordinary income
Income before income taxes
Income taxes – current
Income taxes – deferred

Minority interests in income (losses)
Net income

10

-

-3

4,008

3,192

(Consolidated statements of comprehensive income)

Income before minority interests

FY3/13(April 1, 2012 – March 31,
2013)
4,008

(Millions of yen)
FY3/14(April 1, 2013 – March 31,
2014)
3,189

63

59

-30
483

108
602

80

186

Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Share of other comprehensive income of affiliates
accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of theparentComprehensive income attributable to minority
interests

11

596

957

4,604

4,147

4,604

4,150

-

-2

(3) Consolidated statements of changes in shareholders’ equity
FY3/13 (April 1, 2012–March 31, 2013)(Millions of yen)
Shareholders’ equity
Commonstock
Balance at the
beginning of period

3,559

CapitalsurplusRetainedearnings

4,008

35,417

Treasurystock-1,401

Total
shareholders’ equity

41,584

Change of items during
the period
Dividends fromsurplus

-659

-659

Net income

4,008

4,008

Purchase oftreasury stock

-625

-625

Net changes of
items other thanshareholders' equity
Total change of items
during the period

―

―

3,348

-625

2,722

Balance at the end of
the period

3,559

4,008

38,766-2,02744,306

Accumulated other comprehensive income
Valuationdifferenceonavailablefor-salesecurities
Balance at the
beginning of period

129

Deferred
gains orlosses onhedges8Foreigncurrencytranslation
adjustments

Remeasurements ofdefinedbenefit plans

Total
accumulated
othercomprehens
ive income

-583

―

-445

Minority
interests

Total net
assets―41,138Change of items
during the period
Dividends fromsurplus-659

Net income

4,008

Purchase oftreasury stock-625

Net changes of
items other thanshareholders' equity

63

-30

564

―

596

2

599

Total change of items
during the period

63

-30

564

―

596

2

3,322

Balance at the end of
the period

192

-22

-19

―

151

2

44,46012

FY3/14 (April 1, 2013–March 31, 2014)(Millions of yen)
Shareholders’ equity
Commonstock
Balance at the
beginning of period

3,559

CapitalsurplusRetainedearnings

4,008

38,766

Treasurystock-2,027

Total
shareholders’ equity

44,306

Change of items during
the period
Dividends fromsurplus

-647

-647

Net income

3,192

3,192

Purchase oftreasury stock

-498

-498

Net changes of
items other thanshareholders' equity
Total change of items
during the period

―

―

2,545

-498

2,046

Balance at the end of
the period

3,559

4,008

41,311-2,52644,353

Accumulated other comprehensive income
Valuationdifferenceonavailablefor-salesecurities
Balance at the
beginning of period

192

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustments

Remeasurements ofdefinedbenefit plans

Total
accumulated
othercomprehens
ive income

-19

―

151

-22

Minority
interests

Total net
assets2

44,460Change of items
during the period
Dividends fromsurplus-647

Net income

3,192

Purchase oftreasury stock-498

Net changes of
items other thanshareholders' equity

59

108

789

-14

943

-1

941

Total change of items
during the period

59

108

789

-14

943

-1

2,988

Balance at the end of
the period

252

86

770

-14

1,094

1

47,44913

(4) Consolidated statements of cash flow
(millions of yen)
FY3/14(April 1, 2013–
March 31, 2014)

FY3/13(April 1, 2012–
March 31, 2013)
Cash flow from operating activities
Income before income taxes
Depreciation and amortization
Change in allowance for doubtful accounts (‘-’ means decrease)

6,085
1,156
104

4,893
1,093
-72

Change in allowance for bonuses (‘-’ means decrease)
Change in allowance for retirement benefits (‘-’ means
decrease)
Change in net defined benefit liability (‘-’ means decrease)
Change in allowance for directors’ retirement bonuses (‘-’ means
decrease)
Interest and dividends income
Interest expense

-8

8

-23

-230

-

132

44

57

-23
43

-29
43

Equity in earnings or losses of affiliates (‘-’ means earnings)

-451

-290

Change in accounts receivable – trade (‘-’ means increase)
Change in other accounts receivable (‘-’ means increase)
Change in inventory (‘-’ means increase)
Change in accounts payable – trade (‘-’ means decrease)
Changes in other accounts payable (‘-’ means decrease)765
95-1,016-1,101
55

2,399
-262
-4,61228
28

Other changes-906-1,532

Subtotal

4,818

1,655

Interest and dividends received
Interest paid
Income taxes paid

233
-44
-2,304155-42-2,172

Cash flow from operating activities

2,703

-404

-2,683
10
-50
-8

-681
-51
-9

31
-65

-61

-2,765

-803

-293
800

609
400

Repayment of long-term loans payable
Purchase of treasury stock

-746
-625

-714
-498

Dividends paid
Others

-659
-67

-647
-59

-1,593-909

Cash flow from investing activities
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
Purchase of intangible fixed assets
Purchase of investment securities
Proceeds from sale of investment securities
OthersCash flow from investing activities
Cash flow from financing activities
Net change in short-term loans payable (‘-’ means decrease)
Proceeds from long-term loans payable

Cash flow from financing activities
Effect of exchange rate change on cash and cash equivalents

289

333

Change in cash and cash equivalents (‘-’ means decrease)-1,365-1,784

Cash and cash equivalents at beginning of period

9,948

8,582

Cash and cash equivalents at the end of period

8,582

6,798

14

(5) Notes on consolidated financial statements(Notes on premise of a going concern)
There is nothing to report.

(Changes in accounting standards, etc.)(Application of "Accounting Standard for Retirement Benefits," etc.)
The Company has applied the "Accounting Standard for Retirement Benefits" (Accounting Standards Board ofJapan ("ASBJ") Statement No.26, May 17, 2012) and "Guidance on Accounting Standard for Retirement Benefits"(ASBJ Guidance No.25, May 17, 2012) from the end of the fiscal year under review, excluding paragraph 35 of ASBJ
Statement No.26 and paragraph 67 of ASBJ Guidance No.25. As a result, the Company has changed the way itrecognizes the difference between retirement benefit liabilities and plan assets, with unrecognized actuarial liabilities
and unrecognized prior service costs now recorded as retirement benefit liabilities.
At the application of these accounting standards, in accordance with paragraph 37 of ASBJ Statement No.26, theCompany reduced accumulated other comprehensive income by the amount related to this change at the fiscal yearend.
As a result of the change, the Company recorded retirement benefit liabilities of 156 million yen at the fiscal year
end and reduced accumulated other comprehensive income by 14 million yen.
The impact on per-share financial data is minimal.

15

(Segment information, etc.)(Segment information by business)(Segment Information)
1. Overview of reportable segments
With respect to its business segments, the Company is able to obtain delineated financial data from among its
structural units. Its segments are subject to regular examination in order to assist decision-making on allocation ofmanagerial resources and evaluation of business performance by the Board of Directors.
At Matsuda Sangyo, operation divisions have been established based on each of our products and services in thehead office, and each of these divisions’ works to formulate comprehensive domestic and foreign strategies and to
expand business for the corresponding products and services.
The Company thus comprises product, merchandise and service segments built around operation divisions, andthe precious metals business segment and food business segment are designated as reportable segments. In thisregard, business segments with essentially identical financial characteristics (i.e., the precious metals division and theenvironment division) are combined as the precious metals business segment.
The precious metals business segment recovers and refines precious metals, sells precious metal bullions,chemical products, and electronic materials, and collects, transports and disposes industrial wastes. The foodbusiness segment sells and transports seafood products, agricultural products, livestock products, and other raw
materials for food processing.
2. Calculation method for net sales, income /loss, assets/liabilities, and other items for each reportable segment
Accounting methods used for each reportable segment follow the accounting methods for the preparation of
consolidated financial statements. Income listed for each reportable segment refer to operating income. Intersegment sales/transfers are based on market value.
3. Information for net sales, income /loss, assets/liabilities, and other items for each reportable segment
FY3/13 (April 1, 2012–March 31, 2013)(millions of yen)
Reportable Segments
Precious
metalsbusinesssegment

Adjustments

Food businesssegment

Note1

Total

Amount recordedon consolidated
statements of
Note2
incomeNet sales
124,931

42,332

167,263―

167,263

4

48

52

-52

―

Total

124,936

42,380167,316-52

167,263

Segment income

5,040

528

5,568

―

5,568

Net sales to external parties
Net sales & remittances
between segments(Notes)1. Adjustments correspond to the elimination of transactions and remittances between segments.
2. Total segment income matches operating income recorded on the consolidated statements of income.

16

FY3/14 (April 1, 2013–March 31, 2014)(millions of yen)
Reportable Segments
Precious
metalsbusinesssegment

Adjustments

Food businesssegment

Note1

Total

Amount recordedon consolidated
statements of
Note2
incomeNet sales
118,119

47,296

165,416―

165,416

4

55

60

-60

―

Total

118,124

47,352

165,476-60

165,416

Segment income

3,717

785

4,503

―

4,503

Net sales to external parties
Net sales & remittances
between segments(Notes)1. Adjustments correspond to the elimination of transactions and remittances between segments.
2. Total segment income matches operating income recorded on the consolidated statements of income.

17