FY2017 First Quarter Financial Results

May 8, 2017 (Mon.)WORLD HOLDINGS CO., LTD.
First Section of Tokyo Stock Exchange (2429)
Copyright © WORLD HOLDINGS CO.,LTD. All Rights Reserved0I. Outline of the New Mid-term Managerial Plan 2021
and Primary Measures in 2017
II. Summary of FY2017 First Quarter Financial Results
III. Introduction of New Group Companies
IV. FY2017 Business Forecasts

Copyright © WORLD HOLDINGS CO.,LTD. All Rights Reserved1

I. Outline of the New Mid-term Managerial Plan 2021 andPrimary Measures in 2017

Copyright © WORLD HOLDINGS CO.,LTD. All Rights Reserved2Outline of the New Mid-term Managerial Plan 2021 and Primary Measures in 2017

<New Vision>
Pursuit of evolved systems in which people can exert their abilities“To aim to become a company that can grow stably with enhanced competitiveness and sociality”“Stable business administration” with appropriate scale and balanced management, “business expansion” increasing our business fields,
and “high sociality” toward many sectors through various businesses<First half of the period of the mid-term managerial plan>
To fortify our management base, and expand our businessin existing fields and peripheral ones

<Second half of the period>
Foray into new business fields

Primary measures in 2017
Human Resources and Education
Business

Real Estate Business・Enrichment of a careerdevelopment system for developing ahuman resources platform・To collect data on the preferences ofjob seekers, accept a broad range ofworkers through one-stop services,and develop a base for mutual
matching

・To strengthen and launch businesses(related to renovation and singlefamily housing) that can recoup
investments in a short period of time・Business development while grasping
the field and timing wheredevelopment-related profit (ROI)
would be maximized.

Information and Telecommunications
Business
・To improve the environment ofexisting cellphone shops and open
new excellent stores
・To establish a service of providing
corporations with comprehensive
cost reduction solutions via ourvarious products

Copyright © WORLD HOLDINGS CO.,LTD. All Rights Reserved

3Activities in the First Quarter

Human Resources and Education Business

Real Estate Business<Improvement in the capability ofgiving proposals comprehensively><Redevelopment of a businessportfolio>

To brush up the abilities to give
proposals and negotiate based on thestaffing capability, skills andtechnologies

Foray into the single-family housing field
To procure more real estate to berenovated

To increase large-scale transactions
with favorable conditions<Improvement in the quality,
quantity, and efficiency ofrecruitment>
To promote the strengthening of thecooperation between recruiting and localorganizations

Smooth launch of multiple largescale projects<Improvement in employees’
performance>
Completion of our original careerdevelopment programs

Information and Telecommunications
Business<Fostering of a base for expansion>
Streamlining of store operation andenvironmental improvement
Practice of organizational operation

Start of preparation for the changeof profit balance<Enrichment of B to B services><Transfer of real estate whileemphasizing profit>

Sale of Internet lines for SOHO
Payment business for the inboundStrategic transfer of real estate whileemphasizing profit

Cultivation of new services

Drop in sales because of the
postponement of some transactions<M&A strategy>
Expansion of the existing business toperipheral fields

Hoei Construction Co., Ltd. joined
our corporate group.

Other<M&A strategy>
Foray into the agricultural park field
Farm Co., Ltd. joined our
corporate group.

Start of operation (for improving
skills and retention rate)

Copyright © WORLD HOLDINGS CO.,LTD. All Rights Reserved4II. Summary of FY2017 First Quarter Financial Results

Copyright © WORLD HOLDINGS CO.,LTD. All Rights Reserved5First Quarter Summary
 Sales, operating, ordinary, and quarterly net incomes grew.
 The Human Resources and Education and Information and Telecommunications Businesses
progressed healthily as planned.
 In the Real Estate Business, the transfer of land for business was put off till 2Q or later, in whichhigher profit is expected. Accordingly, it slightly influenced the growth in sales and profit.
Unit: Million yen, %FY2016/1Q
actual

FY2017/1Q
actual

22,72629,074

6,348

Operating income

1,662

1,845

Ordinary income

1,637

Net income attributable toowners of parent

1,015

Net sales

Full-year budget*

Ratio to full-year
budget27.9

123,846

23.5

182

11.0

6,270

29.4

1,810

173

10.6

5,936

30.5

1,108

92

9.2

3,519

31.5

YOY
ChangePct. Change*Announced on February 13, 2017

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6

Sales by Business Segment
 All segments of the Human Resources and Education Business saw sales growth.
 In the Real Estate Business, sales grew as Hoei Construction Co., Ltd. joined our corporate group.
 The profitability of the Information and Telecommunications Business recovered thanks to the investment conducted
over the past several years.
FY2016/1Q
actual(Prof it margin)

FY2017/1Q
actualUnit: Million yen, %Factory BusinessChangeNet sales
Segment income

Technology Business

Human Resources
andEducation
Business

Net sales
Segment income

R&D BusinessNet sales
Segment income

Sales & Marketing
Business
Total (reference)

Net sales
Segment income
Net sales
Segment income

Real Estate BusinessInformation andTelecommunications
Business

Other

Real Estate BusinessNet sales
Segment income

Information andTelecommunications
Business
Others

Net sales

476
311
105
62

(5.0%)

11,792955(8.1%)

8,719
979(11.2%)

2,082
47

Operating income(8.4%)

1,255

131

Elimination or corporate(12.7%)

1,248

Net sales

Net sales(7.0%)

2,462

Segment income

Segment income

Total

6,825

5

(2.3%)(3.9%)

22,726-325
1,662(7.3%)

8,738
706
2,866
294
1,426
95
1,572
72
14,604
1,168
12,151
1,076
2,138
67
180
13
29,074-481
1,845

Full-year
budget*YOY(Prof it margin)(8.1%)(10.3%)(6.7%)(4.6%)(8.0%)(8.9%)(3.2%)(7.7%)(6.3%)(Prof it margin)

Ratio to fullyear budget

Pct. Change

1,912

28.0

34,299

230

48.4

2,242

404

16.4

11,818

△17

△ 5.7

940

178

14.3

6,400

△9

△8.9

582

317

25.3

6,500

9

14.7

397

2,812

23.8

59,018

212

22.3

4,163

3,432

39.4

50,685

96

9.9

3,702

56

2.7

10,198

20

43.9

245

48

36.9

3,943

8

168.3

36

6,348

27.9

123,846-155

48-1,877

183

11.0

6,270

25.5
(6.5%)

31.5
24.3(8.0%)

31.3
22.3(9.1%)

16.4
24.2(6.1%)

18.1
24.7(7.1%)

28.1
24.0(7.3%)

29.1
21.0(2.4%)

27.7
4.6(0.9%)

38.5
23.5
25.6

(5.1%)

29.4*Announced on February 20, 2017

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7

Human Resources and Education Business
The budget progress for the human resources segment is almost as expected.
Factory BusinessTechnology Business

R&D Business

Sales & Marketing Business

4Q

3Q
2Q
1Q
昨年度
FY2016FY2017

予算
Budget

今年度

Exceeding the budget, due toefficient recruitment and increase
in retention rate, with respect tolarge-scale transactions withfavorable conditions

昨年度
FY2016FY2017

予算
Budget

今年度

Exceeding the budget, due to thestrong needs for the developmentof automobiles and software

昨年度
FY2016FY2017

予算
Budget

今年度

The number of workers to bedispatched is healthy. The extension of
the period of the entrusted project in
DOT World degraded performance.

昨年度
FY2016FY2017

予算
Budget

今年度

Through the improvement of ourmanagement capability, the cycle ofdispatch of registered workers
increased.

4Q
3Q
2Q
1Q
昨年度
FY2016FY2017

予算
Budget

今年度

昨年度
FY2016FY2017

予算
Budget

今年度

昨年度
FY2016FY2017

予算
Budget

今年度

昨年度
FY2016FY2017

予算
Budget

今年度*Upper panel: sales, lower panel: segment income

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8Real Estate Business and Information and Telecommunications Business
The Real Estate Business was affected by the postponement of the transfer of real estate till 2Q or later,when higher profit is expected.
The profit from the Information and Telecommunications Business recovered steadily, thanks to theoutcome of business investment.
Real Estate BusinessInformation and Telecommunications Business

4Q
3Q
2Q
1Q
FY2016
昨年度

Budget
予算

FY2017
今年度

Falling below the budget due to thepostponement of the transfer of real estate till
2Q or later, when higher profit is expected

昨年度
FY2016

予算
Budget

今年度
FY2017FY2016
昨年度

Budget
予算

FY2017
今年度

Considerably exceeding thebudget due to the effect ofinvestment

FY2016
昨年度

Budget
予算

FY2017
今年度*Upper panel: sales, lower panel: segment income

Copyright © WORLD HOLDINGS CO.,LTD. All Rights Reserved

9Factory Business<Sales composition by business segment and the number of staff>
 The sales in the fields of semiconductors and logistics, which are our specialties, kept growing steadily.
 Through the negotiation based on the advanced capability of staffing, skills, and technologies, we increased large-scaletransactions with favorable conditions.
 The implementation of our original career development program led to the improvement of employees’ skills andmotivation, and improved the quality of the service of “offering advanced skills and technologies stably.”◆ Sales composition by business segment(Million yen)

10,000Up 28.0% 8,738
8,000

6,825
6,000

22.0%
6.7%
6.1%

4,000

2,000

14.6%
4.8%

◆ Segment income

YoY(Based on
monetary
amount)

18.4%
4.5%
5.5%

+3.9％
△15.6％◆ Variation in the number of staff (3-month average)(Million yen)

(Persons)

800

706

Up 48.4%

12,00011,57910,000

2,830

600

8,075

476

8,000

+11.8％

17.9%+52.4％

5.4%+38.9％

27.8%+44.0％

715

400

6,000
4,000

24.0%

1,296

1,072

7,453
6,288

200
2,000

21.7%

20.5%

2016 1Q

2017 1Q+17.4％

0

0
Electric & Electronics
Automobiles
Machinery
Others0
2016 1Q

2017 1Q

Logistics
Semiconductors
Environment & Energy

2016 1Q

2017 1Q

Other companies/acceptance
Entrusted by overseas and government office
Number of staff*The number of staff is a three-month average. External staff members accepted from other companies
are included.
*Number of staff included only staff members who are engaged in on-site operation work

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10Technology Business<Sales composition by business segment and the number of staff>
 Recruitment and staffing progressed healthily, in response to the strong needs in the fields of automobiles,
information, and telecommunications.
 We increased investment in technical training and career development, for brushing up employees’ skills andrecruiting new workers.
 Strategic investment for expanding the business domain of the repair section◆ Sales composition by business segment(Million yen)

3,000

Up 16.4%2,866
2,462

2,000

◆ Segment income

YoY(Based on
monetary
amount)30.7%+26.3％

6.2%
5.2%+23.9％+22.9％

16.4%

16.3%

+12.5％

45.6%

41.6%

+3.1％

2016 1Q

2017 1Q

27.5%
5.7%
4.8%

◆ Variation in the number of staff (3-month average)(Million yen)

(Persons)

1,903

2,000

400

1,663
311
300

Down 5.7%

294

1,500

200

1,000

100

500

314

224

696

830

1,000

0

0
OthersAutomobiles
Machinery
Information and telecommunications business
Semiconductors

743

759

2016 1Q

2017 1Q

0
2016 1Q

2017 1Q

Construction, repair and other technology
Design development
Production technology*The number of staff is a three-month average.
*Number of staff included only staff members who are engaged in on-site operation work

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11

R&D Business<Sales composition by business segment and the number of staff>
 Establishment of a system for visualizing the skills, experiences, and evaluations of researching staff,
for the purpose of securing excellent personnel and polishing and managing employees’ skills
 We specialize in the recruitment of excellent researching staff from new graduates, and dispatch themearly with favorable conditions.
 DOT World put off the entrusted project till 2Q, but increased trial employees.
◆ Sales composition by business segment(Million yen)

1,500

◆ Segment income
YoY

Up 14.3% 1,426 (Based on
1,248◆ Variation in the number of staff (3-month average)(Million yen)

(Persons)

150

1,000

monetary
20.1％
amount)

800

105

+2.2％

22.4％

100

1,000

Down 8.9%

912
779

82

77

95
600

45.1％
+8.1％

47.7％

702

50

500
34.8％
29.9％

200
+33.2％

00
2016 1Q
2017 1Q
ClinicalChemicalPharmaceutical/biotechnology

830

400

0
2016 1Q

2017 1Q

2016 1Q
R&D staff

2017 1Q
DOT staff*The number of staff is a three-month average.
*Number of staff included only staff members who are engaged in on-site operation work

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12

Sales & Marketing Business<Sales composition by business segment and the number of staff>
 We dispatched more sales staff to leading retail chains and restaurants.
 The sales from the dispatch of operators to mainly leading companies were healthy. The
performance of dispatch of light-duty workers was favorable thanks to the cooperation with thelogistics section of the Factory Business.
◆ Sales composition by business segment(Million yen)

2,000

1,500

Up 25.3%
1,255

1,000

1,572

◆ Segment income

YoY(Based on
monetary
amount)◆ Variation in the number of staff (3-month average)(Million yen)

(Persons)80

Up 14.7%

72

2,500

62
60

35.7％

2,026

1,246

2,000

+19.2％

37.5％

2,861

3,000

40

1,500

997

1,000
500

64.3％

+28.9％

20

1,615

62.5％

500
0

0
2016 1Q

0
2016 1Q

2017 1Q

1,029

2017 1Q

Sales staff dispatch
Operator/light-duty worker dispatch

2016 1Q
Sales staff dispatch

This term, our original names “CB Division” and “OCS Division” wererenamed “Sales staff dispatch” and “Operator/light-duty worker
dispatch,” respectively.

2017 1Q
Operator/light-duty worker dispatch*The number of staff is a three-month average.
*Number of staff included only staff members who are engaged in on-site operation work

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13Real Estate Business<Sales composition by business segment and major activities>
 As for development, the transfer of land for business was put off till 2Q or later, when higher profit is expected.
 Hoei Construction Co., Ltd., which joined our group in Jan. of this term, performed well in single-family housing
projects.
 As for prefabricated houses, we proceeded with the development of new products in cooperation with sanitary ware
makers in Kyushu and the cultivation of the Kyushu area through group synergy.
◆ Sales composition by business segment
YoY(Based on
monetary
12,151 amount)(Million yen)

15,000Up 39.4% 4.7%
10,000◆ Segment income

8,719

24.8％

brand of Hoei Construction, which joined our group in Jan.

(Million yen)

1,500

+46.3％+46.4％◆ “Challenge 999” Series, the representative

1,000

979

Up 9.9%

1,076

4.5%
23.6％

14.0%

5,000

500
71.9%

56.5%

2016 1Q

2017 1Q◆ The new product “Toilet House” developed by

+9.5％

0

Omachi World Co., Ltd.

02016 1Q

2017 1Q

Prefabricated houses-related
Renovation-related
Single-family housing
Development-related*Single-family housing taken into account from 1Q of 2017

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14

Information and Telecommunications Business<Sales and major activities>
 Through restructuring, store operation became more efficient.
 Thanks to the investment so far, the rationalization of stores progressed, and profitability
recovered, and we concentrate on the surveys, etc. for opening stores for further growth.
 We started preparing for the expansion of comprehensive solutions for reducing office costs,
and cultivating new services targeted at the inbound, SOHO, etc.
◆ Sales for each target◆ Segment income(Million yen)

(Million yen)

YoY
(Based on
monetary
amount)

3,000
2,500

100

Up 2.7% 2,138

67

2,082
2,000

11.9%

10.8%

△7.5％

Up 43.9%
50

1,500
1,000

◆ Development of stores that would be chosen by customers

88.1%

47

◆ Enrichment of products for corporations

89.2%

LED lamps

Industrial air-conditioners

Combined machines

Business phone

Surveillance camera

+4.2％

500

0

0
2016 1Q
Individual

2017 1Q

2016 1Q

2017 1Q

Electricity charge

Corporation

Communications charge

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15

Other<Sales and major activities>
 Advan Corp Inc., which runs PC schools, offers technical training for programming and CAD, enriches curricula,
expands target areas, and prepares for direct sale in cooperation with the Technology Business.
 Farm Co., Ltd., which joined our corporate group in Feb., redeveloped its operational system for the peak season in
Apr. and May.
◆ Sales◆ Technical training based on the collaboration between Advan and◆ Segment income(Million yen)

(Million yen)

300

14

the Technology Business

13

12

250

10

180

200

Up 36.9%

Up 168.3%
8

150

131
6

100

◆ As Farm joined our group, we launched the agricultural park business.
5

4

50

2

0

0
2016 1Q

2017 1Q

2016 1Q

2017 1Q*The performance of Farm is taken into account from2Q.

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16

Financial Condition B/S Through the acquisition of new subsidiaries, fixed assets, current liabilities, etc. grew.
Total assets(Million yen)

Current assets

100,000
80,00080,22173,392

70,120 (+3,124)

・ Increase in real estate for sale2,231 million yen

60,00040,00070,12066,996

Fixed assets

10,100 (+3,704)

・ Increase in property, plant and equipment*
20,0000*Due to the acquisition of subsidiaries

6,395

10,100End of FY2016

End of FY2017 1Q

Fixed assets(Million yen)

2,410 million yen

Current assets

Total liabilities/net assets

Current liabilities

48,419 (+4,401)

100,000
80,00080,22173,392・ Increase in short-term and long-term debt*

5,455 million yen*Funds for acquiring the shares of subsidiaries

60,00048,41944,01840,00020,0000

Net assets
13,90916,437

15,464

15,364End of FY2016

End of FY2017 1Q

Net assets

Fixed liabilities

15,364 (△99)• Decrease in retained earnings(168 million yen)

Current liabilities

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17III. Introduction of New Group Companies

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18

Hoei Construction Co., Ltd.

It became a subsidiary in Jan.

No.1 house builder in Hokkaido* ⇒ Sold over 4,000 custom single-family houses mainly in Sapporo City.
*Ranked first in Sapporo City, selling 255 houses in “the section of custom single-family houses of house building ranking in Sapporo City from Jan. to Dec. 2016” by Juutsu Co., Ltd.

<Effect of joining our corporate group>
Synergy with existing business

Synergy with the Renovation Business, targeted at houses they have sold so far

Expansion of the business domain

Expansion of the target area with single-family housing (recurring-revenue business)based on our group’s business base<Characteristics and strengths>

Explicit fee system

No.1 brand power in Hokkaido

Promotion of five brands, including “Challenge 999 Series” for core products

Being community-based,
it grew to be the No.1 house builder in Hokkaido.

To expand the target area from Tohoku, while utilizing thebase of our group and grasping appropriate scale*Franchised store

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19Farm Co., Ltd.
Became a subsidiary in Feb.
Nationwide operation of agricultural parks. It operates 6 owned facilities, and is entrusted with the managementof local governments’ facilities.
⇒ Over 1 million people visit its facilities every year thanks to community-based operation.

< Effect of joining our corporate group >*Its performance taken into account from 2Q

Job creation and regional
vitalization

Community-based creation of a broad range of jobs and regional vitalization

New recurring-revenue business

Recurring-revenue business that boosts profit as visitors increase
Community-based facility. Interaction with animals<Facilities and features>
Akagi Plateau Ranch

Kronenberg
Comorebi
Morino Ibaraido
Sakai Greenery Museum

Events and original products harnessing animals and nature

Chiba Zoological Park

Harvest Hill

Fureai Dobutsu-no-sato

Hibikinada Green Park

Shinshu-Shiojiri Agricultural Park

Tirolean Forest

Shiga Agricultural Park

Minokamo Rest Area

Blume-no-oka
Okayama Agricultural Park

German Forest Kronenberg

Optimal use of existing facilities without excessive equipment investment
We aim to develop facilities that are wanted by each region in cooperation
with local governments.
Copyright © WORLD HOLDINGS CO.,LTD. All Rights Reserved20IV. FY2017 Business Forecasts

Copyright © WORLD HOLDINGS CO.,LTD. All Rights Reserved21Summary of FY2017 Business Forecast
 Sales are estimated to grow for the 8th consecutive term. We will fortify the base for the
new mid-term managerial plan.
Change from forecast

FY2016 actual

FY2017
forecast*

Unit: Million yen, %ChangePct.
change29,51231.3-1,137-15.4-1,369-18.7

Operating income

7,407

Ordinary income

7,306

123,846
6,270
5,936

Net income attributable toowners of parent

4,192

3,519

-672

-16.0

250.92210.6363.2-40.29

-16.1

-12.1

-16.1

Net sales

EPS (yen)
Dividend per share (yen)94,33475.3

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22

Business Forecast by Segment
 Sales are estimated to grow in all segments.
 New business and Farm Co., Ltd. will be incorporated into other business.
FY2016 actual(Profit margin)

FY2017 forecast*(Profit margin)

Unit: Million yen, %Factory BusinessChangeNet sales
Segment income

Human
Resources andEducation
Business

Technology BusinessNet sales
Segment income

R&D BusinessNet sales
Segment income

Sales & Marketing
Business
Total (reference)

Net sales
Segment income
Net sales
Segment income

Real EstateBusiness

Real Estate BusinessInformation andTelecommunications
Business

Information andTelecommunications
Business

Other

Others

Net sales
Segment income
Net sales
Segment income
Net sales
Segment income
Net sales

Total

Change from forecast

Elimination or corporate
Operating income

30,111
2,080
10,334
1,015
5,533
571
5,654
296
51,633
3,964
34,481
5,171
7,742
244
476
17
94,334-1,9907,407(6.9%)(9.8%)(10.3%)(5.3%)(7.7%)(15.0%)(3.2%)(3.7%)(7.9%)

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34,2992,242
11,818
940
6,400
582
6,500
397
59,0184,163
50,685
3,702
10,198245
3,943
36
123,846-1,8776,270(6.5%)(8.0%)(9.1%)(6.1%)(7.1%)(7.3%)(2.4%)(0.9%)(5.1%)

4,187
162
1,484
-74
867
10
845
100
7,384
198
16,204-1,468
2,455
0
3,467
18
29,512(―)-1,137

Pct. change

13.9
7.8
14.4
-7.4
15.7
1.9
15.0
33.9
14.3
5.0
47.0
-28.4
31.7
0.3
727.8
103.9
31.3
(―)
-15.4

23

Shareholder Returns
From fiscal 2016, we aim to achieve a payout ratio of 30%.
(Yen)

80.0

Dividend per share

75.3

70.0
63.2

60.0
50.0

45.7

40.0
30.0

23.7

20.0
10.0

8.5
4.33

4.5

10.0

4.5

0.0
FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017(forecast)*The forecast and dividend estimated are based on the information that the Company has and a certain assumption that is
considered reasonable. There is a possibility that the actual results may largely differ based on various factors.

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24For More Information
Shohei Shigematsu
Public Relations and Investor Relations Department
Corporate Planning Division
WORLD HOLDINGS CO., LTD.
TEL

03-3433-6005

E-MAILirinfo＠world-hd.co.jp

URL

http://www.world-hd.co.jp/

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