Financial Results
for the Third Quarter
From June 1, 2015 to February 29, 2016

ERI Holdings Co., Ltd.
March 29, 2016
Listed on Tokyo Stock Exchange (Code 6083)
http://www.h-eri.co.jp
1Summary
Both net-sales and operating income increased 6.4% and 290.6%
on year-on-year comparison, respectively


In Q3, expansion of housing starts has temporarily slowed, but our housing related
business was stable.

In Building Confirmation and Inspection services, after the revision of Building StandardLaw, new services - Route-2 Structural Examination andPre-completion Tentative Approval – have been performing well.

In Housing Performance Evaluation and its related services, the examination service for
Point System for Energy Saving Homes (expired on Oct. 2015) andLong-life Quality Housings have been performing well.

In other segment, the existing building related services have been growing successfully,
but the services of Evaluation of Seismic Capacity and Seismic Retrofitting Plans andStructural Evaluation of High-rise Buildings struggled with a shrinking market.

Japan ERI newly set up Energy Saving Promotion Division to enhance operation formandatory energy saving standard confirmation and other energy saving relatedservices.

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2Fiscal Results for the Third Quarter Ended February 29, 2016

Consolidated results(Millions of yen)

ChangeFY2014 3Q

FY2015 3Q(Jun. 2014 – Feb. 2015)(Jun. 2015 – Feb. 2016)

AmountsRatio

8,853(8,052)

8,685(8,571)▲168(518)▲1.9%(6.4%)

Operating Income

125490365290.6%

Operating Income Ratio

1.4%

5.6%

--Ordinary Income

159502342215.0%

Ordinary Income Ratio

1.8%

5.8%

--Profit Attributable toOwners of Parent68339271

399.2%Net Income per Share(Yen)

8.80

43.44

34.64

-Gross Sales(Net Sales *)* Net sales is subtracted peer check fee, which is paid to the other bodies through ERI group, from gross sales. Due to the revision of Building Standard Law in June
2015, applicants directly apply to structural calculation review body and, from FY 2016, our group sales result in the same number that was previously net sales.
Although in this 2Q, pre-revision orders from 1Q are still included, and both gross- and net-sales are described. Tokyo Bldg-Tech Center Co., Ltd (TBTC), consolidated
subsidiary, changes account closing date from end of March to end of May and its 11-months results is consolidated. In above consolidated results, TBTC’s net-sales iscounted and this net-sales doesn’t match with it disclosed last year.
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3

Fiscal Results for the Third Quarter Ended February 29, 2016

Consolidated results by segment(Millions of yen)

FY20143Q

FY2015
3Q

ChangeAmounts

Ratio

Operating
IncomeChangeBuilding Confirmationand Inspection(Net Sales*1)

5,231(4,463)［55.4%］

4,569(4,460)［52.0%］▲662(▲3)▲12.7%(▲0.1%)

220

256

Housing Performance
Evaluation and its
related services

2,009［25.0%］

2,261［26.4%］

251

12.5%

9363

Others(Net Sales*1)

1,611(1,578)［19.6%］

1,854(1,849)［21.6%］

243(270)

15.1%(17.1%)

176

45

8,853
［100.0%］※2

8,685［100.0%］※2

▲168

▲1.9%

490

365

Gross Sales Total*1 Net sales is subtracted peer check fee, which is paid to the other bodies through ERI group, from gross sales. Due to the revision of Building Standard Law in June
2015, applicants directly apply to structural calculation review body and, from FY 2016, our group sales result in the same number that was previously net sales.
Although in this 2Q, pre-revision orders from 1Q are still included, and both gross- and net-sales are described. Tokyo Bldg-Tech Center Co., Ltd (TBTC), consolidated
subsidiary, changes account closing date from end of March to end of May and its 11-months results is consolidated. In above consolidated results, TBTC’s net-sales iscounted and this net-sales doesn’t match with it disclosed last year.
*2 Structural ratio [ ] is calculated using Net sales. (FY2014 8,052 million yen, FY2015 8,571 million yen)
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4

Fiscal Results for the Third Quarter Ended February 29, 2016

Main operating figures | Consolidated(Cases)

FY2014 3Q

FY2015 3Q(Jun. 2014 – Feb. 2015)（Jun. 2015 – Feb. 2016）

ChangeAmounts

Ratio

Building
confirmations

43,194

43,218240.1％

Final inspections

36,43735,337▲1,100▲3.0％

Housing design
performance
evaluations ofdetached house

13,931

14,496565

4.1％

Housing design
performance
evaluations ofcollective house

16,811

16,351

▲460

▲2.7％

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5

Fiscal Results for the Third Quarter Ended February 29, 2016

Key service figures | Consolidated
FY2015 3Q

ChangeAmounts

Cases（Millions of Yen）

Amounts

Cases（Millions of Yen）

Building confirmations for medium to large
size buildings (over 500 sqm)

3,868

995

98

2

Housing performance evaluations ofdetached houses*1

14,496

559

565

15

Technical assessments for Long-Life Quality
Housings*2

17,092266974▲2Inspections for housing defect liability
insurance*317,954

217

1,840

13

Evaluations of seismic capacity andseismic retrofitting plans

25787▲161▲42

Structural evaluations of high-rise buildings( Skyscraper and/or Base isolation)

7285▲29▲47

Sales of “Technical assessments for Long-Life Quality Housings” in Financial Results for the First Quarter (released September 30, 2015) was incorrect number.
The number is corrected from 65 to 94 million yen and recalculated number is described in this table.
*1 Cases and amounts by housing design performance evaluation.
*2 The number of cases which the certification of Long-Life Quality Housing were issued.
*3 Jutaku Anshin Hosyo’s cases and amounts.
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6Fiscal Results for the Third Quarter Ended February 29, 2016

Changes of quarterly results | Consolidated
Quarterly net sales and ordinary income
Net sales(Millions of yen)

Ordinary income(Millions of yen)
400

4000

350

3500

300
3000
250
2500

200
150

2000

100

1500

50
1000
0
Ordinary income-50500Net sales-1000
FY2011
3Q

FY20114Q

FY2012
1Q

FY20122Q

FY20123Q

FY20124Q

FY20131Q

FY20132Q

FY20133Q

FY20134Q

FY20141Q

FY20142Q

FY20143Q

FY20144Q

FY20151Q

FY20152Q

FY2015
3Q

Until third quarter of FY2013, data is financial results announced by JAPAN ERI CO.,LTD.

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7

Fiscal Results for the Third Quarter Ended February 29, 2016

Forecast for FY 2015
Our previous forecast※ of full-year earnings remains unchangedBoth housing and non-housing newly built market will be stable.
In existing buildings related services, Legal Compliance Inspection for Existing
Buildings, Due Diligence and other inspection services will keep on growing.
Building Energy Conservation Act is in effect on April 2016 and, for the firststep, non-mandatory guideline and incentive plans start. The Best-effort
obligations to indicate energy saving performance will stimulate BELS needs
among property owners. In addition, other new services – Approving orIndication of Compliance with Energy Saving Standard andApproving of Plan for Energy Saving Performance Improvement (for easing ofbuilding volume regulation) - start.

※We announced “Notice on Revision of Earnings Forecast for the Fiscal Year Ending May 2016” on December 8, 2015.

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8

Fiscal Results for the Third Quarter Ended February 29, 2016

Forecasts for FY2015(Millions of yen)

FY2015FY2014

Change11,949(10,883)

11,866（11,752）▲82(868)

Operating Income

292741

449

Vs. Gross Sales

2.4%

6.2%

－Ordinary Income

331754422

Vs. Gross Sales

2.8%

6.4%

－Profit Attributable to Owners ofParent

18507

489

Net Income per Share (Yen)

2.37

64.93

62.56

Dividend per Share (Yen)

30300

Gross Sales(Net Sales *)* Net sales is subtracted peer check fee, which is paid to the other bodies through ERI group, from gross sales. Due to the revision of Building Standard Law in June
2015, applicants directly apply to structural calculation review body and, from FY 2016, our group sales result in the same number that was previously net sales.
Although in this 2Q, pre-revision orders from 1Q are still included, and both gross- and net-sales are described. Tokyo Bldg-Tech Center Co., Ltd (TBTC), consolidated
subsidiary, changes account closing date from end of March to end of May and its 11-months results is consolidated. In above consolidated results, TBTC’s net-sales iscounted and this net-sales doesn’t match with it disclosed last year.
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9Fiscal Results for the Third Quarter Ended February 29, 2016

Topics
Summary of indication-related budget subsidy systems on draft budget for FY2016
Project

Building Type and Project Summary

New
Construction/ Renovation

Leading Projects for
Sustainable Buildings,etc. (MLIT)【Housing and Non-housing】
Expenses need to introduce advanced technologies for the maintenance of buildingstructures and to verify cost effectiveness.
Display of CASBEE/BELS certification is mandatory.
Subsidy ratio : 1/2（Upper limit : depending on conditions）

New
construction/ Renovation【Housing】
Amount equivalent to the additional cost required to construct zero-energy housing by small
and medium building contractors.
Display of BELS certification is mandatory.
Subsidy ratio : 1/2（Upper limit : depending on conditions）

New
construction/ Renovation【Non-housing】
Amount equivalent to the additional cost required to construct a certified low-carbon
building by small and medium building contractors.
Approving of low-carbon buildings or BELS/CASBEE certification is mandatory.
Subsidy ratio : 1/2（Upper limit : depending on conditions）

Newconstruction【Non-housing】
Expenses for building frame renovation expected more than 15% energy performance
improvement and also to meet particular energy saving standard after renovation.
Display of BELS certification is mandatory.
Subsidy ratio : 1/3（Upper limit : 50 million yen per project）

Renovation

Regional ResidenceGreening Projects(MLIT)

Energy-saving
Promotion Projects for
Existing Buildings(MLIT)

Source：This summary ｉs based on the document, “Indication-related budget subsidy system (draft budget for FY2016)“ announced by MLIT on March 11, 2016.
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10Fiscal Results for the Third Quarter Ended February 29, 2016

Topics(continued)
Summary of indication-related budget subsidy systems on draft budget for FY2016
Project

Building Type and Project Summary

New
Construction/ Renovation

Model Project toPromote CO2
Reductions Rental
Housing（MOE, MLIT）【Housing】
Expenses of introducing CO2-efficient equipment for projects which build/renovatelow-carbon rental houses and display/inform its environmental performance widely.
Display of BELS certification for every dwelling unit is mandatory.
Subsidy ratio : 1/2（Upper limit : 0.6 million yen per unit）,1/3（Upper limit : 0.3 million yen per unit）

New
construction/ Renovation【Housing】
Partial expenses of construction of ZEH※ by registered house builders.
Display of BELS certification is considered as a scoring up factor in the examination.
Subsidy ratio : Fixed amount（1.25 million yen per unit）

Newconstruction/ Renovation【Non-housing】
Partial expenses of introduction for high-efficiency facilities to the building proof of ZEB※.
Display of BELS certification（ZEB-READY or better） is mandatory.
Subsidy ratio : 2/3（Upper limit : 1 billion yen/FY2016）

Newconstruction/ Renovation【Non-housing】
Expense to introduce high-performance facilities/systems for energy-saving and low-carbon
which contribute to achieve ZEB※ in small and medium size commercial buildings.
Display of BELS certification （ZEB-READY or better） is mandatory.
Subsidy ratio : 2/3（Upper limit : 0.3 billion yen/FY2016）

Newconstruction/ Renovation

Promotion Project for
Innovative Energyefficiency Technologies
to Housing andBuilding（METI）
Promotion Project for
CO2 Reductions
Commercial Buildings（MOE, METI）※ZEH：Net Zero Energy House, ZEB：Net Zero Energy Building
Source：This summary ｉs based on the document, “Indication-related budget subsidy system (draft budget for FY2016)“ announced by MLIT on March 11, 2016.
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11

Fiscal Results for the Third Quarter Ended February 29, 2016