Consolidated Financial Results for the Fiscal Year Ended March 31, 2016 [J-GAAP]May 12, 2016

Company Name:

Dai Nippon Printing Co., Ltd.

Stock exchange listing:Tokyo
Stock code:
7912
URL: http://www.dnp.co.jp/
Representative:
Yoshitoshi Kitajima, President
Contact person:
Takaaki Tamura, General Manager, Press and Public Relations
Telephone:+81-3-6735-0101
General meeting of shareholders:June 29, 2016
Dividend payment date:June 30, 2016
Securities report issuing date:June 29, 2016
Preparation of earnings presentation material: None
Holding of earnings announcement:
None*Amounts under one million yen have been rounded down.

1. Consolidated financial results for the year ended March 31, 2016
(April 1, 2015 – March 31, 2016)(1) Consolidated financial results(Percentages show change from corresponding year-ago period.)
Net Income
Attributable toOperating Income
Ordinary Income
Parent Company
Shareholders

Net Sales
Million yen%

Million yen%

Million yen%

Million yen%

Year ended March 31, 2016

1,455,916(0.4)

45,471(5.6)

52,651(2.1)

33,587

24.8

Year ended March 31, 2015

1,462,118

0.9

48,173(3.8)

53,7590.9

26,9235.0

Note: Comprehensive income: Year ended March 31, 2016: ¥(19,805) million (–%)
Year ended March 31, 2015: ¥165,683 million (197.4%)
Diluted Net
Incomeper Share

Net Income
per Share

Ordinary
Income toTotal Assets

ROE

Operating
Income to
Net Sales

Yen

Yen

%

%

%

Year ended March 31, 2016

53.10

53.07

3.2

3.0

3.1

Year ended March 31, 2015

41.82

41.44

2.7

3.2

3.3

Reference: Equity in earnings of affiliates: Year ended March 31, 2016: ¥3,696 million
Year ended March 31, 2015: ¥2,171 million(2) Consolidated financial position
Total Assets

Net Assets

Net Assets
per Share

Equity Ratio

Million yen

Million yen%

Yen

As of March 31, 2016

1,718,636

1,063,241

59.2

1,618.66

As of March 31, 2015

1,809,462

1,124,093

59.6

1,675.63

Reference: Stockholders’ equity: As of March 31, 2016: ¥1,017,425 million

As of March 31, 2015: ¥1,078,828 million(3) Consolidated cash flows
Cash Flows fromOperating Activities

Cash Flows from
Investing Activities

Cash Flows from
Financing Activities

Cash and Cash
Equivalents at Endof the Year

Million yen

Million yen

Million yen

Million yen

Year ended March 31, 2016

72,629(60,883)(47,166)

175,513

Year ended March 31, 2015

85,730(50,540)(23,864)

212,762

2. Dividends
Dividends per Share
First
Quarter-end

SecondThird
Quarter-end Quarter-end

Year-end

AnnualTotal Dividends(Annual)Dividend
Payout Ratio(Consolidated)

Dividends to
Net Assets
Ratio(Consolidated)

Yen

Yen

Yen

Yen

Yen

Million yen%%

Year ended March 31, 2015

–

16.00

–

16.00

32.00

20,62076.5

2.0Year ended March 31, 2016

–

16.00

–

16.00

32.00

20,13160.3

1.9

Year ending March 31,2017 (Forecast)

–

16.00

–

16.00

32.00

58.3

3. Consolidated earnings forecasts for the year ending March 31, 2017
(April 1, 2016 – March 31, 2017)(Percentages show change from corresponding year-ago period.)
Net Income
Operating
Attributable to
Net Income
Ordinary Income
IncomeParent Company
per Share
Shareholders

Net Sales

Full year

Million yen%

Million yen%

Million yen%

Million yen%

Yen

1,470,000

1.0

48,000

5.6

54,0002.6

34,5002.7

54.89* Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting ina change in the 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: Yes
2) Changes in accounting policies other than the 1) above:No3) Changes in accounting estimates:
No4) Restatement of revisions:No
Note: For further details, see the section titled, “5. Consolidated financial statements (5) Notes regarding
consolidated financial statements [Changes in accounting policies],” on page 26.
(3) Number of common shares issued and outstanding
1) Number of common shares outstanding
As of March 31,
at end of each period (including
2016
treasury shares)
2) Number of treasury shares at end of
As of March 31,
2016each period
3) Average number of shares outstanding
Year ended
March 31, 2016
during the period

680,480,693 As of March 31,
shares2015

700,480,693
shares51,919,577 As of March 31,
shares2015

56,647,614
shares632,591,975
Year ended
shares March 31, 2015

643,867,888
shares(Reference) Non-consolidated financial results
Non-consolidated financial results for the year ended March 31, 2016
(April 1, 2015 – March 31, 2016)(1) Non-consolidated financial results(Percentages show change from corresponding year-ago period.)
Operating Income
Ordinary Income
Net Income(Loss)Net Sales
Million yen%

Million yen%

Million yen%

Million yen%

Year ended March 31, 2016

1,001,026

0.2(1,542)–

28,20615.5

22,848

4.5

Year ended March 31, 2015

999,023

8.7

(469)

–

24,424(7.8)

21,86374.2

Net Income
per Share

Diluted Net Income
per Share
Yen

Yen

Year ended March 31, 2016

36.09

–

Year ended March 31, 2015

33.93

–

(2) Non-consolidated financial position
Total Assets

Net Assets

Net Assets
per Share

Equity Ratio

Million yen

Million yen%

Yen

As of March 31, 2016

1,362,528

726,36753.3

1,154.60

As of March 31, 2015

1,429,806

768,42453.7

1,192.50

Reference: Stockholders’ equity: As of March 31, 2016: ¥726,367 million As of March 31, 2015: ¥768,424 million* Presentation of audit status
These consolidated financial results are exempt from auditing procedures based on the Financial
Instruments and Exchange Act. The financial statements are being audited based on the Financial
Instruments and Exchange Act at the time of the disclosure of these consolidated financial results.
* Explanation regarding appropriate use of earnings forecasts and other special notes
Forward-looking statements in this report, including earnings forecasts, are based on assumptions about
economic conditions, market trends, and other factors at the time the report was prepared. Actual results
may differ significantly due to a variety of factors. See the “1. Analysis of operating results and financial
position (1) Analysis of operating results” on pages 2–4 for information about earnings forecasts.

Contents
1. Analysis of operating results and financial position ............................................................................... 2(1) Analysis of operating results .......................................................................................................... 2(2) Analysis of financial position .......................................................................................................... 5(3) Basic policies regarding the allocation of profits and dividends for the year ended March 31, 2016
and year ending March 31, 2017 .................................................................................................... 5(4) Business risks ................................................................................................................................ 6
2. Information on DNP ............................................................................................................................... 8
3. Management policies........................................................................................................................... 12(1) Core policies ................................................................................................................................. 12(2) Medium- and long-term management strategy and key issues .................................................... 12
4. Basic approach in the choosing of accounting standards ................................................................... 15
5. Consolidated financial statements ....................................................................................................... 16(1) Consolidated balance sheets ....................................................................................................... 16(2) Consolidated statements of income and comprehensive income ................................................ 18(3) Consolidated statements of changes in net assets ...................................................................... 20(4) Consolidated statements of cash flows ........................................................................................ 22(5) Notes regarding consolidated financial statements ...................................................................... 24[Notes on premise of a going concern].......................................................................................... 24[Basis of presenting consolidated financial statements] ................................................................ 24[Changes in accounting policies] ................................................................................................... 26[Consolidated balance sheets] ...................................................................................................... 27[Consolidated statements of income] ............................................................................................ 27[Consolidated statements of changes in net assets] ..................................................................... 28[Segment information, etc.] ........................................................................................................... 30[Per share information] .................................................................................................................. 33[Significant subsequent events]..................................................................................................... 34
6. Non-consolidated financial statements ................................................................................................ 35(1) Non-consolidated balance sheets ................................................................................................ 35(2) Non-consolidated statements of income ...................................................................................... 37(3) Non-consolidated statements of changes in net assets ............................................................... 38(4) Notes regarding non-consolidated financial statements ............................................................... 39[Notes on premise of a going concern] ......................................................................................... 39

1

1. Analysis of operating results and financial position(1) Analysis of operating results1) Operating results for the fiscal year ended March 31, 2016
Japan’s economy gradually recovered during the fiscal year ended March 31, 2016, as reflected by
improvement in corporate earnings and employment conditions, supported by the economic policiesof the Japanese government and monetary easing policies of the Bank of Japan. However, theeconomy has still not reached a full-fledged recovery, due partly to sluggish consumer spending,overseas economic slowdowns, including in China, and volatility in forex and equity markets since
the start of 2016.
The printing industry continued to face a tough business environment as a result of lower demandfor printed media, including published printed materials, and lower order prices due to stiffer
competition.
In this environment, the DNP Group (DNP) reviewed the DNP Group Vision for the 21st Century,
which it prepared in 2001 as a basic management policy, and established the DNP Group Vision2015 in October 2015. As part of this vision, DNP states its corporate philosophy as: “The DNPGroup connects individuals and society, and provides new value.” It also defines its business vision
as: “Use P&I innovations to expand business, primarily in four growth areas.”
In the area of “Knowledge and Communication,” one of these four growth areas, DNP acquired allshares in HyperTech Co., Ltd., a provider of anti-cracking software that prevents application
tampering on smartphones and other devices, in May 2015, in order to accelerate the development
and delivery of information security-related products and services. DNP established CYBERKNOWLEDGE ACADEMY Co., Ltd., which operates an academy to provide education and training
to personnel responding to the growing number of targeted cyber attacks, in March 2016.
Additionally, DNP launched Imaging Mall as a cloud-based image sales solution offering a number ofservices that include the storage and processing of image data for various content, sales website
operation, and high-quality printing and delivery, in August 2015.
In the “Food and Healthcare” area, DNP focused on cultivating new businesses by developing
products that leverage its material processing technologies. One example is an agricultural film that
promotes photosynthesis based on high light reflectivity and supports the cultivation of fruits andvegetables through appropriate moisture retention and fouling resistance. Additionally, DNP
acquired additional shares in PSP Corporation, a leading provider of medical imaging management
systems, making it an equity-method affiliate, in March 2016, after first forming a business andcapital alliance in December 2014. Going forward, DNP aims to expand business in the life sciencesarea, including by accelerating the development of image analysis technology that contributes toinvestigating the causes of diseases.
In the “Lifestyle and Mobility” area, DNP acquired all shares of Tamura Plastic Mfg. Co., Ltd. inAugust 2015, and is working to develop highly competitive new products for automotive applications
by combining Tamura’s resin molding technologies with DNP’s technologies in such areas as hardcoat transfer films and decorative films.
In the “Environment and Energy” area, DNP develops and delivers products that help to conserve
energy and reduce CO2 emissions. As one example, it launched sales in October 2015 of a newlighting film that can make a room brighter overall by effectively reflecting sunlight that entersthrough windows and diffusing it to the ceiling and other areas.
The entire DNP Group, based on the new basic management policy, worked to expand its
business by creating new value, focusing on enhancing the value of existing business whiledeveloping new business, mainly in the four growth areas.

2

As a result of these activities, consolidated net sales fell 0.4% year on year to ¥1,455.9 billion,
consolidated operating income fell 5.6% to ¥45.4 billion, consolidated ordinary income fell 2.1% to¥52.6 billion, and net income attributable to parent company shareholders grew 24.8% to ¥33.5
billion.
Business segment results are presented below.
DNP changed its reportable business segments effective from the current fiscal year, andcomparison and analysis of this fiscal year’s performance are based on the new business segments.
[PRINTING]
Information Communication
In the Books and Magazines business, amid a continued slump in the publications market, booksales increased from last year thanks to aggressive sales activities, but a decline for magazines hada large impact, and overall sales fell below prior-year levels.
In the Commercial Printing business, sales were generally on par with the previous year, despite
weak sales of flyers, catalogs, and other printed materials, due to growth for point-of-purchasepromotional materials (POP) and other sales promotion-related tools.
In the Business Forms business, sales increased for Information Processing Services (IPS;
handling data entry, printing, and shipment of personalized mail and other items) and for smart cards
used in electronic money and other applications, benefiting from growing corporate needs to safely
and appropriately manage the personal information of employees and customers. In the smart cardbusiness, DNP is working to bolster competitiveness in Southeast Asia and is accelerating its global
expansion. It formed a business and capital alliance with MK Smart Joint Stock Company, Vietnam’s
leading manufacturer of smart cards, in March 2014. This fiscal year it established a joint venturewith PT. Wahyu Kartumasindo International, Indonesia’s leading manufacturer and seller of cash
cards.
In the Imaging Communication business, DNP launched services for taking ID photos at Ki-Re-i
photo booths and applying for Individual Number Cards under the “My Number” social security andtax number system using a highly secure communication environment. Moreover, sales were strongfor dye-sublimation thermal transfer printing media (color ink ribbons and receiver paper) as a resultof growing demand for photo printing in North America and Southeast Asia. As a result, overall salesrose well above prior-year levels.
In the Education and Publications Distribution business, sales were favorable in the “honto” hybrid
bookstore network that combines physical bookstores, online bookstores, and e-book sales services.
The operations outsourcing business from libraries also expanded on growth in the number ofoutsourcing libraries, amid their efforts to enhance operational efficiency and improve services forlibraries’ users. Overall sales increased from the previous year.
As a result of the above, overall segment sales grew 4.0% year on year to ¥821.6 billion andoperating income grew 32.3% to ¥29.3 billion.
Lifestyle and Industrial Supplies
In the Packaging business, sales increased for paper cups and molded plastic goods, but overallsales decreased year on year on declines for paper packaging, film packaging, and PET plastic
bottle aseptic filling systems.
In the Lifestyle Materials business, DNP focused on developing overseas markets and sales ofenvironmentally conscious products and other products that use its proprietary Electron Beamcoating technology. However, sales decreased year on year on a slow recovery in housing
construction demand.

3

In the Industrial Supplies business, sales increased from the previous year on strong sales forboth photovoltaic module components and lithium-ion battery components.
As a result of the above, overall segment sales fell 1.5% year on year to ¥382.6 billion andoperating income fell 7.9% to ¥12.5 billion.
Electronics
In the Display Products business, sales were favorable for vapor deposition masks (metal masks)
used in the production of organic light-emitting diode (OLED) displays, which show promise as
next-generation displays. However, LCD color filter sales decreased from the previous year on
declines for both small- and medium-sized filters for smartphones and tablets, and large filters forTVs. Moreover, optical film sales decreased year on year on a decline for mainstay anti-reflection
films.
In the Electronic Devices business, semiconductor photomask sales increased overseas but weresluggish in Japan, and with lead frame sales also declining, overall sales decreased from theprevious year.
As a result of the above, overall segment sales fell 13.4% year on year to ¥199.3 billion andoperating income fell 20.8% to ¥20.5 billion.
[BEVERAGES]
Beverages
The soft drink industry continued to face a tough market environment, as manufacturers vied formarket share through price competition. However, DNP worked to expand market share in existing
markets and to acquire new customers by bolstering its core brand products through the introductionof new bottle cans and product renewals, and by advancing the vending machine business througharea marketing.
As a result of these efforts, sales increased for coffee drinks that use a new extraction technology
and for tea drinks including the mainstay Ayataka brand, but decreased to group bottlers outside the
Hokkaido region and for the Coca-Cola brand and sports drinks. Overall segment sales fell 2.6%
year on year to ¥58.0 billion and operating income fell 8.0% to ¥0.9 billion.
2) Forecast for the fiscal year ending March 31, 2017
Concerning the future outlook, DNP anticipates a gradual economic recovery in Japan based on
growth in corporate earnings and improvement in the employment and income environment,
supported by various measures taken by the government and Bank of Japan. Overseas, however,
the impact of economic slowdowns is still a concern, and DNP expects uncertain conditions going
forward. In the printing industry, DNP expects conditions to remain difficult amid a decline in orderprices due to weak demand and stiffer competition.
During the fiscal year ending March 31, 2017, DNP will push forward with efforts to create newvalue to achieve its business vision: “Use P&I innovations to expand business, primarily in four
growth areas.” It also aims to expand earnings further by improving productivity to establish a morerobust business foundation.
For the fiscal year ending March 31, 2017, DNP forecasts consolidated net sales of ¥1,470.0
billion, consolidated operating income of ¥48.0 billion, consolidated ordinary income of ¥54.0 billion,
and consolidated net income attributable to parent company shareholders of ¥34.5 billion.

4(2) Analysis of financial position
1) Assets, liabilities, and net assets
Total assets at the end of the current fiscal year decreased by ¥90.8 billion from the end of theprevious fiscal year to ¥1,718.6 billion, due mainly to a decrease in cash and time deposits.
Total liabilities decreased by ¥29.9 billion from the end of the previous fiscal year to ¥655.3 billion,
due mainly to a decrease in deferred tax liabilities.
Net assets decreased by ¥60.8 billion from the end of the previous fiscal year to ¥1,063.2 billion,
due mainly to a decrease in remeasurements of defined benefit plans.
2) Cash flows
Consolidated cash flow provided by operating activities totaled ¥72.6 billion (¥85.7 billion in theprevious fiscal year), due mainly to ¥54.8 billion in income before income taxes and non-controllinginterests and ¥65.3 billion in depreciation.
Cash flow used in investing activities totaled ¥60.8 billion (¥50.5 billion in the previous fiscal year),due mainly to ¥64.4 billion in payments for purchases of property, plant and equipment. Cash flowused in financing activities totaled ¥47.1 billion (¥23.8 billion in the previous fiscal year), due mainly
to ¥20.8 billion in dividends paid and ¥20.0 billion for purchases of treasury stock.
As a result, cash and cash equivalents at the end of the fiscal year decreased by ¥37.2 billion fromthe end of the previous fiscal year to ¥175.5 billion.
The trends in DNP’s cash flow indicators are shown below.
Year ended
March 2012

Year ended
March 2013

Year ended
March 2014

Year ended
March 2015

Year ended
March 2016

Equity ratio (%)

54.2

56.6

59.2

59.6

59.2

Market value-based
equity ratio (%)

33.9

36.1

40.4

41.6

36.6

Debt-to-cash flow ratio(year)

2.1

2.3

1.5

2.2

2.6

Interest coverage ratio(times)

33.2

28.8

40.6

35.1

29.8

Notes:***

Equity ratio: Total stockholders’ equity / Total assets
Market value-based equity ratio: Market capitalization / Total assets
Debt-to-cash flow ratio: Interest-bearing debt / Cash flow
Interest coverage ratio: Cash flow / Interest paid
The above indicators are calculated based on consolidated financial figures.
Market capitalization is calculated as: Fiscal year-end share price × fiscal year-end number of shares
outstanding (excluding treasury stock)
Cash flow: Cash flow provided by/used in operating activities on the consolidated statements of cash flows
Interest-bearing debt: All liabilities on the consolidated balance sheet that accrue interest charges
Interest paid: Interest paid on the consolidated statements of cash flows(3) Basic policies regarding the allocation of profits and dividends for the year ended
March 31, 2016 and year ending March 31, 2017
An important policy of Dai Nippon Printing Co., Ltd. (the Company) is to pass on profits toshareholders.

5Profits are allocated based on a policy of paying stable dividends to shareholders and withconsideration for financial results and the dividend payout ratio. For future business expansion, theCompany strives to retain profits and strengthen its financial constitution and management base.
Retained earnings are used to invest in research and development related to new products andtechnologies, to invest in equipment needed for developing new businesses, and to implement
strategic alliances, including mergers and acquisitions. At the same time, the Company considers
flexible capital policies while also taking into consideration market trends as well as its need forcapital. The Company believes that these efforts will contribute to higher profits that can then bepassed on to shareholders in the future.
Based on this policy, the Company intends to pay a year-end dividend of ¥16 per share, which
together with the interim dividend of ¥16 per share brings the full-year dividend to ¥32 per share, thesame as in the previous fiscal year. As a result, the consolidated dividend payout ratio will be 60.3%.
The forecast dividend for the fiscal year ending March 31, 2017 is ¥32 per share, the total of a ¥16interim dividend and a ¥16 year-end dividend.
(4) Business risks
The performance and the results of DNP could be significantly affected by a variety of factors andcircumstances that might arise in the future. Because DNP is aware of these risk factors, its policy is
to strive to minimize their potential effects.
The following are the major factors that the DNP management views as risks.
1) The Japanese and overseas economies and consumption trends
DNP engages in a wide range of businesses with an extremely large number of corporate customers,
and steadily conducts its business so as not to overly depend on specific customers. DNP does
most of its business in the Japanese market, but if consumer spending and other components ofdomestic demand slump, owing to domestic economic weakness in sympathy with global economic
trends, declines in order volume and unit prices may affect its corporate performance.
Additionally, DNP could be directly or indirectly affected by market trends in various industries inJapan or overseas. In particular, electronics-related industries are susceptible to global declines inunit prices caused by an expansion of production in emerging countries and changes in demand,and DNP’s performance could be affected by major changes in market trends.
2) Overseas business activities
DNP conducts overseas business activities in the Americas, Europe, Southeast Asia, and elsewhere,
and these activities face risks including social and political turmoil caused not only by economic
factors such as unexpected changes in law and regulations, stricter environmental-related laws andregulations, fragility of industrial infrastructure, and difficulty of hiring and securing personnel, butalso by terrorism, war, and other factors. DNP’s performance could be affected if its overseas
business activities are obstructed as a result of these risks materializing.
3) Development of new products and services
DNP uses its printing and information technologies to develop products and services that deliver
new value to companies, consumers, and society. These development efforts face an accelerating
pace of technological innovation and diversification of needs. Going forward, amid expectations fordevelopment competition to intensify in Japan and overseas, it is possible that DNP’s performance
could fluctuate significantly due to a greater-than-expected shortening of product life cycles andchanges in market trends.

64) Strategic business and capital alliances and corporate acquisitions
DNP engages in strategic business and capital alliances and corporate acquisitions, and its
performance could be affected if it is unable to achieve initially expected results and synergies as aresult of deterioration in the business environment affecting the companies and businesses involvedin these alliances and acquisitions.
5) Fluctuations in raw material procurement
DNP works hard to secure stable supplies and maintain optimal price by procuring raw materials
such as printing paper and film from multiple suppliers in Japan and overseas. However, there issome potential for temporary imbalances between supply and demand due to sharp fluctuations inpetroleum prices, sudden surges in demand from emerging markets, the impact of major disasters,
the depletion of natural resources, and climate change. DNP will respond during such times bynegotiating with client companies and business partners, but its performance could be affected if raw
materials procurement becomes extremely difficult, if purchasing prices rise sharply, or if other such
events occur.
6) Currency fluctuations
Amid growth in business with overseas customers, DNP expects the impact of foreign exchange to
steadily increase. We use such means as foreign exchange forward contracts to hedge the risks ofcurrency fluctuations. Nevertheless, it is possible that radical swings in currency values could have amore serious effect on DNP’s performance.
7) Environmental protection and stricter environmental regulations
DNP is affected by legal regulations in Japan and other countries related to energy conservation,
climate change prevention (e.g., reduction of greenhouse gas emissions), reduction of the use ofharmful substances, air pollution prevention, water quality protection, waste treatment, and productrecycling. These regulations could conceivably be strengthened or changed in the future. In addition,
DNP’s business could be substantially affected if faced with a situation in which soil is contaminatedby harmful substances and it is held responsible for assessment and cleanup.
8) Information security and personal information protection
Global computer networks and information systems have become essential tools for conducting
business, and there are now greater risks of software and hardware defects, computer virus
infections, and personal data leaks. DNP regards the protection of data and personal information asa top priority. It is doing all it can to protect and maintain systems and data by strengthening its
organization and training employees, but if problems arise in these areas, then its business activity
could be affected.
9) Response to changes in legal regulations
DNP conducts its business based on strict compliance with law and social ethics. We are subject toa variety of legal regulations in Japan and overseas, including product liability laws, antimonopoly
laws, personal data protection laws, patent laws, tax regulations, and import and export rules. We
believe these regulations could be strengthened in the future. On the other hand, market andindustry trends may change substantially as a result of deregulation. If that should occur, it ispossible that DNP’s business performance could be affected by limitations on its business activities,
the burden of responding to regulatory changes, or increased costs.

710) Disasters
DNP takes steps to protect production equipment and other major facilities from fires andearthquakes, seeks to disperse production facilities, and works to minimize production shutdowns
and product supply disruptions caused by disasters. We also use various types of insurance totransfer risk. Nevertheless, DNP’s performance could be substantially affected in the event of major
earthquakes, natural disasters such as heavy rainfall or flooding caused by climate change, disease
outbreaks, or other unexpected events that cause production shutdowns or significantly damage or
impair social infrastructure.
11) Lawsuits and fines
DNP seeks to establish corporate ethics throughout the group, and works to earn the trust of society
by each and every employee complying with laws and regulations in conducting business activities,
maintaining higher ethical standards than required by society, and contributing to maintaining andadvancing orderly and freely competitive markets with a consistently fair attitude. Nevertheless,
DNP’s performance could be affected in the event of being subject to lawsuits and resulting fines inJapan or overseas.
2. Information on DNP
DNP Group includes the Company, 148 subsidiaries, and 22 affiliated companies. Its two main
businesses are Printing and Beverages. The former encompasses Information Communication,
Lifestyle and Industrial Supplies, and Electronics.
The businesses and segments of DNP are broadly outlined below. The four business segments
cited below are the same as the reporting segment categories.
[PRINTING]
Information Communication
Production/sale of textbooks, books, weekly/monthly/quarterly magazines, promotional materials,
securities certificates, business forms, cards, settlement-related services, photographic materials,
and business equipment and systems; and planning/design/construction/management of stores andadvertising media
Major companies
Production

OGUCHI BOOK BINDING & PRINTING CO., LTD.
DNP Imagingcomm Co., Ltd., DNP AV Center Co., Ltd.
DNP SP Tech Co., Ltd., DNP Graphica Co., Ltd.
DNP Book Factory Co., Ltd., DNP Digitalcom Co., Ltd.
DNP Data Techno Co., Ltd., DNP Multi Print Co., Ltd.
DNP Media Art Co., Ltd., DNP Media Create Co., Ltd.
DNP Media Support Co., Ltd.

Production and sales

DNP Imagingcomm Asia Sdn. Bhd., DNP Imagingcomm Europe B.V.
DNP Imagingcomm America Corporation, Foto Fantasy, Inc.
Tien Wah Press (Pte.) Ltd.
*MK Smart Joint Stock Company

Sales and services

Maruzen CHI Holdings Co., Ltd., INTELLIGENT WAVE INC.
BUNKYODO GROUP HOLDINGS CO., LTD.
SHUFUNOTOMO Co., Ltd., 2Dfacto, Inc.

8

CYBER KNOWLEDGE ACADEMY Co., Ltd.
DNP ID System Co., Ltd., DNP Art Communications Co., Ltd.
DNP Social Links Co., Ltd., DNP Photo Imaging Japan Co., Ltd.
DNP HyperTech Co., Ltd., Metro Systems Co., Ltd.
mobilebook.jp, Inc., DNP Photo Imaging Europe SAS
MARUZEN-YUSHODO Co., Ltd.
MARUZEN PUBLISHING CO., LTD.
MaruzenJunkudo Bookstores Co., Ltd.
Toshokan Ryutsu Center Co., Ltd., honto Book Services Co., Ltd.
BUNKYODO Co., Ltd.
* Nihon Unisys, Ltd., BOOKOFF CORPORATION LIMITEDAll About, Inc., Kyoiku Shuppan Co., Ltd.
The shares of Maruzen CHI Holdings Co., Ltd., Nihon Unisys, Ltd. and
BOOKOFF CORPORATION LIMITED are traded on the Tokyo Stock
Exchange, and the shares of INTELLIGENT WAVE INC., BUNKYODOGROUP HOLDINGS CO., LTD. and All About, Inc. are traded on theTokyo Securities Exchange’s JASDAQ market.
Lifestyle and Industrial Supplies
Production/sale of containers and packaging products, packaging equipment and systems, interior
and exterior decorative printed materials, and industrial supplies
Major companies
Production

DNP Technopack Co., Ltd., Sagami Yoki Co., Ltd.
DNP Ellio Co., Ltd., DNP Advanced Materials Co., Ltd.
DNP Lifestyle Materials Co., Ltd., DNP Hoso Co., Ltd.

Production and sales

DNP Tamura Plastic Co., Ltd., Aseptic Systems Co., Ltd.
DNP Fine Chemicals Utsunomiya Co., Ltd.
PT DNP Indonesia, DNP Vietnam Co., Ltd.

Sales and services

DNP Lifestyle Materials Marketing Co., Ltd.
DNP Field Eyes Co., Ltd., LIFESCAPE MARKETING CORPORATIONElectronics
Production/sale of precision electronic components and other products
Major companies
Production

DNP LSI Design Co., Ltd., DNP Fine Optronics Co., Ltd.
DNP Precision Devices Himeji Co., Ltd.

Production and sales

DNP Color Techno Kameyama Co., Ltd., DAP Technology Co., Ltd.
DT Fine Electronics Co., Ltd.
DNP Denmark A/S, DNP Photomask Europe S.p.A.
*Photronics DNP Mask Corporation

Sales

DNP Taiwan Co., Ltd.

9

Companies with multiple types of businesses
Production and sales

DNP Fine Chemicals Co., Ltd., D.N.K. Co., Ltd., DNP Shikoku Co., Ltd.
* DIC Graphics Corporation

Sales and services

DNP Logistics Co., Ltd., DNP Trading Co., Ltd.
DNP Accounting Services Co., Ltd.
DNP Information Systems Co., Ltd.
DNP Human Services Co., Ltd., DNP Facility Services Co., Ltd.
DNP Hokkaido Co., Ltd., DNP Tohoku Co., Ltd.
DNP Chubu Co., Ltd., DNP Nishi Nippon Co., Ltd.
DNP Asia Pacific Pte. Ltd., DNP Corporation USA
DNP America, LLC, DNP Holding USA Corporation[BEVERAGES]
Beverages
Centered on Hokkaido Coca-Cola Bottling Co., Ltd.; manufacture/sale of soft drinks and juices
The shares of Hokkaido Coca-Cola Bottling Co., Ltd. are traded on the Tokyo Stock Exchange andSapporo Securities Exchange.
* Equity-method affiliated companies

10Organizational chart
The businesses noted above are shown in the organizational chart below.

Customers
Information Communication

Lifestyle and Industrial Supplies(Production and sales)
DNP Imagingcomm Asia Sdn. Bhd.
DNP Imagingcomm Europe B.V.
DNP Imagingcomm America
Corporation
Foto Fantasy, Inc.
Tien Wah Press (Pte.) Ltd.
MK Smart Joint Stock Company*(Production and sales)
PT DNP Indonesia
DNP Vietnam Co., Ltd.

Electronics

Beverages(Sales)DNP Taiwan Co., Ltd.
(Production and sales)
DNP Denmark A/S
DNP Photomask Europe S.p.A.
Photronics DNP Mask Corporation*(Sales and service provision)
DNP Photo Imaging Europe SAS

Dai Nippon Printing Co., Ltd.

(Production)
OGUCHI BOOK BINDING &PRINTING CO., LTD.
DNP Imagingcomm Co. Ltd.
DNP AV Center Co., Ltd.
DNP SP Tech Co., Ltd.
DNP Graphica Co., Ltd.
DNP Book Factory Co., Ltd.
DNP Digitalcom Co., Ltd.
DNP Data Techno Co., Ltd.
DNP Multi Print Co., Ltd.
DNP Media Art Co., Ltd.
DNP Media Create Co., Ltd.
DNP Media Support Co., Ltd.

(Production)
DNP Technopack Co., Ltd.
Sagami Yoki Co., Ltd.
DNP Ellio Co., Ltd.
DNP Advanced Materials Co. Ltd.
DNP Lifestyle Materials Co., Ltd.
DNP Hoso Co., Ltd.

(Sales and service provision, etc.)
Maruzen CHI Holdings Co., Ltd.
INTELLIGENT WAVE INC.
BUNKYODO GROUP HOLDINGS CO.,LTD.
SHUFUNOTOMO Co., Ltd.
2Dfacto, Inc.
CYBER KNOWLEDGE ACADEMY Co.,Ltd.
DNP ID System Co., Ltd.
DNP Art Communications Co., Ltd.
DNP Social Links Co., Ltd.
DNP Photo Imaging Japan Co., Ltd.
DNP HyperTech Co., Ltd.
Metro Systems Co., Ltd.
mobilebook.jp, Inc.
MARUZEN-YUSHODO Co., Ltd.
MARUZEN PUBLISHING CO., LTD.
MaruzenJunkudo Bookstores Co., Ltd.
Toshokan Ryutsu Center Co., Ltd.
honto Book Services Co., Ltd.
BUNKYODO Co., Ltd.
Nihon Unisys, Ltd. *BOOKOFF CORPORATION LIMITED*All About, Inc.*
Kyoiku Shuppan Co., Ltd.*(Production and sales)
DNP Fine Chemicals Co., Ltd.
(Sales and service provision, etc.)
DNP Logistics Co., Ltd.
DNP Human Services Co., Ltd.
DNP Hokkaido Co., Ltd.
DNP Asia Pacific Pte. Ltd.

DNP Shikoku Co., Ltd.

(Production and sales)
DNP Tamura Plastic Co., Ltd.
Aseptic Systems Co., Ltd.
DNP Fine Chemicals Utsunomiya
Co., Ltd.

(Production and sales)
DNP Color Techno Kameyama Co.,Ltd.
DAP Technology Co., Ltd.
DT Fine Electronics Co., Ltd.

(Sales and service provision, etc.)
DNP Lifestyle Materials Marketing
Co., Ltd.
DNP Field Eyes Co., Ltd.
LIFESCAPE MARKETINGCORPORATION

D.N.K. Co., Ltd.

DIC Graphics Corporation*

DNP Trading Co., Ltd.
DNP Facility Services Co., Ltd.
DNP Tohoku Co., Ltd.
DNP Corporation USA

DNP Accounting Services Co., Ltd.

DNP Information Systems Co., Ltd.

DNP Chubu Co., Ltd.
DNP America, LLC

DNP Nishi Nippon Co., Ltd.
DNP Holding USA Corp.

Printing businessNotes: *(Production)
DNP LSI Design Co., Ltd.
DNP Fine Optronics Co., Ltd.
DNP Precision Devices Himeji Co.,Ltd.

(Production and sales)
Hokkaido Coca-Cola Bottling Co., Ltd.

(Production and sales): Equity-method affiliated companies (Otherwise, subsidiaries): Flow of products, materials and services

11

Beverages
business3. Management policies(1) Core policies
The DNP Group’s basic management policy, the DNP Group Vision 2015, states its corporate
philosophy as: “The DNP Group connects individuals and society, and provides new value.” Basedon this philosophy, DNP is aggressively pursuing its business activities and working to expand its
business over the medium to long term.
DNP believes it is important to enhance corporate governance to fulfill its corporate social
responsibility (CSR) as a company and deliver new value to its various stakeholders. It seeks toestablish and operate systems to facilitate precise managerial decision-making, prompt andappropriate execution of business based on these decisions, and supervision and auditing of thisbusiness execution. It also undertakes rigorous training and education to improve the complianceawareness of each and every employee.
DNP is also working to fulfill what it considers to be its three responsibilities as a company: “Value
Creation,” “Integrity in Conduct,” and “Transparency (Accountability).” To fulfill these responsibilities,
DNP adheres to its DNP Group Code of Conduct in pursuing its activities and ensures proper
business conduct by preparing internal control systems. It strives to conduct business in good faith
to earn the deep trust of its various stakeholders, including shareholders, client companies,
consumers, and employees.
(2) Medium- and long-term management strategy and key issues
The DNP Group focuses on the creation of new value by leveraging its strength in P&I (Printing &Information) in the four growth areas of “Knowledge and Communication,” “Food and Healthcare,”“Lifestyle and Mobility,” and “Environment and Energy.”
In Knowledge and Communication, DNP endeavors to support people’s lifestyles and foster
culture through the safe and reliable transmission of information in an information society. In addition
to the production of information media and content, the company is working to provide information
platforms enabling the safe and reliable exchange of information that people need, at the time theyneed, and in the format they need.
In Food and Healthcare, DNP endeavors to support safer and higher-quality living in a super-aging
society by developing products and services to help consumers maintain their health throughout
their lives. It intends to broaden the scope of its business to include regenerative medicine and otherlife sciences as well as agriculture, in addition to packaging for foods, beverages, andpharmaceuticals.
In Lifestyle and Mobility, DNP seeks to provide services to create more comfortable, safe, andsecure living spaces in a variety of settings, including homes, offices, medical facilities, automobiles,
and railway cars.
In Environment and Energy, DNP will work to achieve a sustainable society that combines
economic growth and environmental preservation. It seeks to provide environmentally conscious
products in terms of resource saving, energy saving, and recycling, and energy management andother solutions.
DNP will work to expand its business by delivering products, services, and platforms that leverage
its strengths, mainly in these growth areas.

121) Initiatives in the different businesses and segments[PRINTING]
Information Communication
The Information Communication segment provides new value to consumers and companies byenabling the optimal expression of information and expanding into a diverse range of media basedon advanced printing technologies and information security technologies.
In the Publishing business, we are deepening cooperation with publishers and pursuing a varietyof business activities, including the planning, production, distribution, and sales of various
publications, and the secondary use and overseas expansion of content.
In the Information Innovation business, we are using advanced information security infrastructure,including the DNP Kashiwa Data Center and five domestic business process outsourcing (BPO)
centers, to deliver a variety of high-value-added services, including international brand prepaid cardand payment-linked marketing services, and corporate BPO services. We established theInformation Innovation Operations by merging the Information Solution Operations and the C&I(Communication & Information) Operations in April 2016. Through this action, we seek tostrengthen cooperation between the information communication technology (ICT) and BPO fields,
including further integration of marketing and payment services, and to develop a new businessmodel.
In the Imaging Communication business, in addition to responding to growing consumer needs insuch areas as photo printing and photo albums, we seek to leverage IT to offer new services thatconnect companies and consumers.
We have made some changes in the naming to the business units in this segment in order tobetter align business names with business content and structure.
Lifestyle and Industrial Supplies
The Lifestyle and Industrial Supplies segment provides products and services in Japan andoverseas that respond precisely to the diverse needs of companies and consumers, including
through efforts to protect the global environment and support universal design.
In the Packaging business, we are working to expand market share for high-performance products,
including the Innovative Barrier (IB) film series of transparent films with excellent barrier properties tokeep out oxygen and moisture; and the Biomatech series of biomass plastic packaging materials
that use biomass as raw material. In particular, in the ASEAN market, we have been manufacturing
and selling packaging in Indonesia since 1972, and have top market shares in a wide range of areas
including daily goods and foods in Indonesia. We opened a plant in Vietnam in May 2013, and areusing these facilities to deliver high-value-added products and services to Japanese companies
expanding overseas and global companies.
In the Lifestyle Materials business, we seek to address a full range of needs related to comfortableliving space. These include high-value-added products that use DNP’s proprietary Electron Beamcoating technology; the design of more pleasant living spaces using Kansei (sensitivity) engineering;
the assessment of living environments; and the development of simpler construction methods. We
are developing new products such as metal paneling that conserves energy by effectively reflecting
and diffusing light. We seek to leverage our global sales network to expand market shares in Europe,
US, and emerging markets.
Electronics
In the Electronics segment, we endeavor to advance and combine our current technologies whiledeveloping new core technologies, and to provide products, services, and systems that anticipate
the changing needs of companies and consumers. We will assess changes in the market

13environment in Japan and overseas, and reform our cost structure through such means as
optimizing production facilities and reviewing our production and development structures.
In the Display Products business, we will draw on DNP’s strength in processing and materials
technologies to develop new products for high-definition smartphones, 4K and 8K TVs, andautomotive displays while responding to a variety of needs in terms of higher resolution, wider color
gamut, larger size, lighter weight, thinner profile, greater energy efficiency, and higher performance.
For optical films, we are focusing on developing new products, mainly for flat-panel displays, thatleverage converting technologies for processing materials in a clean production environment. For
OLED display products, we will add production capacity according to demand growth for vapor
deposition masks (metal masks) that leverage DNP’s proprietary technologies in advanced
photolithography and etching, and we will seek to maintain and increase our high market share.
In the Electronic Devices business, for semiconductor photomasks, we support the miniaturizationand cost-saving needs of semiconductor makers by working to commercialize next-generation
microfabrication technologies such as nanoimprinting and extreme ultra violet (EUV) exposure, andare preparing a development and supply system for cutting-edge products with a line width of 10nm.
[BEVERAGES]
Beverages
In the soft drink industry, we believe it will become increasingly difficult to secure earnings ascompetition for market share intensifies. Under these conditions, we are working to execute thethree strategies of increasing market share, overwhelming the competition, and cutting groupwide
costs based on the following vision: “Leveraging the global brand strength of our Coca-Colabusiness, we intend to beat our competition based on our local capabilities as a true Hokkaido
company, contribute to local Hokkaido communities by consistently delivering new value andservices, and establish a business foundation capable of sustained growth.”	 2) Strengthened organization
DNP cites taiwa (dialogue) and cooperation as guiding principles, and is working to deliver newvalue by enhancing groupwide efforts to strengthen cooperation further among business units andby deepening dialogue with companies and consumers.
We will work to expand our business by cooperating with both domestic and overseas companies
possessing various strengths.
We are also moving forward in redeveloping the Ichigaya district of Tokyo with the aim ofadvancing our business vision further. For example, we completed the DNP Ichigaya-Kagacho
Building as a central part of this plan in August 2015. The planning, sales and marketing offices ofvarious business units, which were scattered across the Tokyo Metropolitan Area, are now gathered
together with the group’s headquarter functions in the Ichigaya district. Through this concentration,
we will also bolster new business development, review our production and distribution structures,and promote taiwa and cooperation to create new value.
3) Reinforcing DNP’s business continuity plan (BCP)
Aiming for a “disaster-proof DNP Group,” we established the “DNP Group Basic Code for Disaster
Response” and we implement disaster prevention and preparedness measures on a daily basis inline with our disaster prevention plan. Since the Tohoku–Pacific Ocean Earthquake, we have worked
to minimize the potential impact that a disaster or abnormal weather conditions could have on ourbusiness by reviewing our business continuity plan (BCP) and by enhancing distribution andalternative production systems and by reconfiguring our production bases in Japan and overseas tostrengthen our overall product supply chain. We will also carefully conserve energy and introduce

14independent power generation equipment.
4) Contributing to the realization of a sustainable society
Global climate change is a growing concern, including rising temperatures and water shortages.	
 DNP’s various environmental initiatives to build a sustainable society that coexists with natureinclude the establishment of a proprietary environmental management system, prevention of global
warming, reduction of waste, reduction of water usage, protection of biodiversity, suppression ofdischarge of volatile organic solvents, rigorous management of chemical substances, developmentof environmentally conscious products and services, and green purchasing.
DNP has established greenhouse gas emission reductions targets for the fiscal year ending inMarch 2031 in order to step up our efforts to prevent global warming. We calculate greenhouse gas
emissions (Scope3) in Japan and overseas not only for our manufacturing operations, but also
indirect emissions throughout our entire supply chain, and are working toward a global reduction ofgreenhouse gas emissions.
To protect biodiversity, we will continue to cooperate with suppliers based on the procurement
guidelines that we established for paper, which has great dependence and impact on theeco-system including forest resources and climate change. We are also using our company sites tocreate green spaces connecting the surrounding environment and living creatures.
Thanks to these initiatives, DNP was included on the CDP* Climate A List, receiving the highest
honors for a second consecutive year. The CDP attracts interest from global institutional investors(eight Japanese companies were included in the Climate A List).
* CDP is a UK-based global nonprofit organization that provides a global system for themeasurement, disclosure, management, and sharing of critical environmental information fromcompanies and cities.
4. Basic approach in the choosing of accounting standards
DNP Group uses Japanese GAAP in preparing consolidated financial statements. It plans to
consider IFRS going forward and respond appropriately based on domestic and overseas
circumstances.

155. Consolidated financial statements(1) Consolidated balance sheets(Million yen)
Year ended March 31, 2015
(As of March 31, 2015)

Year ended March 31, 2016
(As of March 31, 2016)

210,979
366,068
97,231
28,27822,3958,540
30,450(822)
763,122

171,694
348,585
101,239
29,68625,021
10,744
36,103(1,349)721,724

537,358(352,718)
184,639774,271(675,358)
98,913
154,093
41,457
138,307(104,621)
33,686
512,790584,013(366,497)
217,516
771,660(682,111)
89,549155,532
14,946
141,311(105,700)
35,611
513,156

3,276
25,281
2,024
30,583

8,765
24,9112,125
35,802

397,116
8,958
65,9306,600
32,875(8,514)502,966
1,046,340
1,809,462

362,654
6,792
45,843
6,731
32,354(6,424)447,952
996,911
1,718,636

ASSETS
Current assets
Cash and time deposits
Notes and trade receivables
Merchandise and finished products
Work in progress
Raw materials and supplies
Deferred income taxes
Other
Allowance for doubtful accounts
Total current assets
Fixed assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Machinery and equipment
Accumulated depreciation
Machinery and equipment, net
LandConstruction in progress
Other
Accumulated depreciation
Other, net
Total property, plant and equipment
Intangible fixed assets
Goodwill
Software
Other
Total intangible fixed assets
Investments and other assets
Investment securities
Long-term loans
Net defined benefit asset
Deferred income taxes
Other
Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
TOTAL ASSETS

16

(Million yen)
Year ended March 31, 2015
(As of March 31, 2015)

Year ended March 31, 2016
(As of March 31, 2016)

258,887
53,370
10,241
8,074
17,42887,401
435,404

255,585
55,3167,764
6,014
17,333
81,299423,313103,750
20,58565,86032,34827,419249,964
685,368

107,560
18,19048,884
34,167
23,278232,080
655,394

114,464
144,898
737,241(94,386)
902,217

114,464
144,283
717,029(81,024)
894,752

147,914

123,478(0)
7,247
21,449(6)
3,050(3,849)176,610

122,672

16
45,248
1,124,093
1,809,462

16
45,8001,063,241
1,718,636

LIABILITIESCurrent liabilities
Notes and trade payables
Short-term bank loans
Current portion of long-term debt
Income taxes payable
Reserve for bonuses
Other
Total current liabilities
Long-term liabilities
Bonds
Long-term debt
Deferred tax liabilities
Net defined benefit liability
Other
Total long-term liabilities
TOTAL LIABILITIESNET ASSETSStockholders’ equity
Common stock
Capital surplus
Retained earnings
Treasury stock
Total stockholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Net deferred losses on hedges
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total accumulated other comprehensive
incomeStock acquisition rights
Non-controlling interests
TOTAL NET ASSETSTOTAL LIABILITIES AND NET ASSETS

17

(2) Consolidated statements of income and comprehensive income
Consolidated statements of income(Million yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest and dividends income
Equity in earnings of affiliates
Foreign exchange transaction gain
Other
Total non-operating income
Non-operating expenses
Interest expense
Contributions
Other
Total non-operating expenses
Ordinary income
Extraordinary gains
Gain on sale of fixed assets
Gain on sale of investment securities
Other
Total extraordinary gains
Extraordinary losses
Loss on sale or disposal of fixed assets
Loss on business integration
Production restructuring costs
Repair costs
Other
Total extraordinary losses
Income before income taxes andnon-controlling interests
Current income taxes
Deferred income taxes
Total income taxes
Net income
Net income attributable to non-controllingshareholders
Net income attributable to parent company
shareholders

18

Year ended
March 31, 2015
1,462,118
1,182,954
279,163
230,989
48,173

Year ended
March 31, 2016
1,455,916
1,173,203
282,712237,240
45,471

4,138
2,171
1,754
4,472
12,536

5,226
3,696
–
5,828
14,751

2,453
1,348
3,148
6,950
53,759

2,439
1,222
3,909
7,571
52,651

245
4,442
157
4,845

224
15,135
1,131
16,491

2,186
4,342
–
–
1,014
7,543

1,833
–
2,264
7,672
2,531
14,30151,061

54,84014,096
8,474
22,571
28,49013,348
6,788
20,136
34,704

1,566

1,116

26,92333,587

Consolidated statements of comprehensive income(Million yen)

Net income
Other comprehensive income
Valuation difference on available-for-salesecurities
Net deferred gains (losses) on hedges
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Share of other comprehensive income ofassociates accounted for using equity method
Total other comprehensive income
Comprehensive income
Attributable to：Parent company shareholders
Non-controlling shareholders

19Year ended
March 31, 2015
28,490Year ended
March 31, 2016
34,704

113,163(24,502)

(30)
6,991
15,19922(5,235)(26,118)

1,868

1,325

137,192
165,683(54,509)(19,805)

163,315
2,367(20,351)545

(3) Consolidated statements of changes in net assets
The year ended March 31, 2015 (April 1, 2014 – March 31, 2015)(Million yen)
Stockholders’ equity

Balance at the beginning ofcurrent period

CapitalsurplusRetainedearnings

Treasurystock

114,464

144,898

727,070(94,322)

Cumulative impact ofaccounting changes
Balance at the beginning ofcurrent period reflecting
accounting changes
Changes of items during theperiodTotalstockholders’equityCommonstock

4,000
114,464

144,898

Cash dividends paid
Net income attributable toparent company
shareholders
Change of scope of
consolidation
Change of scope of equity
method731,070(94,322)

26,92326,923

(140)

(140)

9

9

(1)

(66)

(66)

2

1

0

0

Net changes in items otherthan stockholders’ equity
Total changes of items
during the period
Balance at the end of current
period896,111(20,621)

0

Other

4,000

(20,621)

Purchases of treasury
stock
Disposal of treasury stock892,110

–
–

0

6,170

(64)

6,106

114,464

144,898

737,241(94,386)

902,217

Accumulated other comprehensive income

Balance at the beginning ofcurrent period

Valuationdifference on
available-forsale securities

Net deferredgains (losses)on hedges

Foreigncurrencytranslation
adjustments

Remeasurements ofdefined benefit
plans

Total
accumulated
othercomprehensive
incomeStockacquisitionrights

Noncontrollinginterests

Total net
assets34,597

3

144

5,473

40,21816

44,040976,386

(505)

3,494

43,534

979,881

Cumulative impact ofaccounting changes
Balance at the beginning ofcurrent period reflecting
accounting changes
Changes of items during theperiod34,597

3

144

5,473

40,21816(20,621)

Cash dividends paid
Net income attributable toparent company
shareholders

26,923

Change of scope of
consolidation
Change of scope of equity
methodPurchases of treasury
stock

(140)
9
(66)
1

Disposal of treasury stock

0

Other
Net changes in items otherthan stockholders’ equity

113,316

(3)

7,102

15,976

136,392–

1,713

138,105

Total changes of items
during the period

113,316

(3)

7,102

15,976

136,392–

1,713

144,212

Balance at the end of current
period147,914

(0)

7,247

21,449176,61016

45,248

1,124,093

20

The year ended March 31, 2016 (April 1, 2015 – March 31, 2016)(Million yen)
Stockholders’ equity

Balance at the beginning ofcurrent period

Totalstockholders’equityCommonstock

CapitalsurplusRetainedearnings

Treasurystock

114,464

144,898

737,241(94,386)

902,217

Changes of items during theperiodCash dividends paid
Net income attributable toparent company
shareholders
Change in ownershipinterest of parent arisingfrom transactions with
non-controllingshareholders(20,376)(20,376)

33,58733,587

(615)

(615)

Purchases of treasury
stock
Disposal of treasury stock
Cancellation of treasury
stock(20,066)(20,066)

(0)

1

1

(33,422)

33,422

–

3

3

Other
Net changes in items otherthan stockholders’ equity
Total changes of items
during the period
Balance at the end of current
period––(615)(20,211)

13,361(7,465)

114,464

144,283

717,029(81,024)

894,752

Accumulated other comprehensive income

Balance at the beginning ofcurrent period
Changes of items during theperiodValuationdifference on
available-forsale securities

Net deferredgains (losses)on hedges

Foreigncurrencytranslation
adjustments

Remeasurements ofdefined benefit
plans

Total
accumulated
othercomprehensive
incomeStockacquisitionrights

Noncontrollinginterests

Total net
assets147,914

(0)

7,247

21,449176,61016

45,248

1,124,093(20,376)

Cash dividends paid
Net income attributable toparent company
shareholders

33,587

Change in ownershipinterest of parent arisingfrom transactions with
non-controllingshareholders
Purchases of treasury
stock(20,066)

Disposal of treasury stock

1

Cancellation of treasury
stock

–

Other

3

Net changes in items otherthan stockholders’ equity
Total changes of items
during the period
Balance at the end of current
period(615)(24,435)(6)(4,196)(25,299)(53,938)–552(53,386)(24,435)(6)(4,196)(25,299)(53,938)–552(60,851)

123,478

(6)

3,050

(3,849)122,672

16

45,8001,063,24121

(4) Consolidated statements of cash flows(Million yen)

Year ended
March 31, 2015
Cash flows from operating activities
Income before income taxes and non-controllinginterests
Depreciation
Impairment loss
Increase (Decrease) of doubtful receivables, net
Increase of net defined benefit asset
Increase (Decrease) of net defined benefit liability
Equity in gains of affiliates
Amortization of consolidation goodwill, net
Interest and dividend income
Interest expense
Net gain on sales of investment securities
Net loss on devaluation of investment securities
Net losses on sale or disposal of fixed assets(Increase) Decrease in trade receivables
Increase in inventories
Increase (Decrease) in trade payables
Other
Sub-total
Payments for extra retirement payments
Payment of income taxes
Net cash provided by operating activities
Cash flows from investing activities
Net decrease in time deposits
Payments for purchases of property, plant andequipment
Proceeds from sales of property, plant and equipment
Payments for purchases of investment securities
Proceeds from sales of investment securities
Payments for purchase of intangible fixed assets
Payments for purchase of stock in subsidiaries resulting
in change in scope of consolidation
Interest and dividends received
Other
Net cash used in investing activities

22

Year ended
March 31, 2016

51,061

54,84067,03379
700(14,798)150(2,171)
1,989(4,138)2,453(4,455)67
1,980(12,507)(5,711)
4,766
14,871
101,371(153)(15,487)
85,73065,310109(1,393)(15,311)(8)(3,696)
2,200(5,226)2,439(15,111)923
1,665
17,880(10,531)(4,725)
178
89,543(990)(15,923)
72,6292,161

38(52,627)(64,415)

3,961(2,329)7,845(8,988)2,791(5,664)
19,949(8,701)(675)(8,981)

4,989(4,876)(50,540)

6,178(2,079)(60,883)

(Million yen)

Year ended
March 31, 2015
Cash flows from financing activities
Net increase in short-term bank loans
Proceeds from long-term debt
Repayments of long-term debt
Proceeds from issuance of bonds
Payments for redemption of bonds
Payments for purchases of treasury stock
Payments for purchases of treasury stock of subsidiaries
Interest paid
Dividends paid
Dividends paid to non-controlling interests
Payments for purchase of stock in subsidiaries not
resulting in change in scope of consolidation
Other
Net cash used in financing activities
Effect of exchange rate changes on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Increase in cash and cash equivalents resulting fromchange of scope of consolidation
Decrease in cash and cash equivalents resulting from themerger of consolidated subsidiaries
Increase in cash and cash equivalents resulting from themerger of non-consolidated subsidiaries
Cash and cash equivalents at end of year

23

Year ended
March 31, 2016

4,028
11,152(10,232)
2,946(1,850)(66)(0)(2,442)(20,612)
(364)

2,131
5,803
(10,552)
4,718(1,050)(20,066)(1)(2,436)(20,381)
(452)

–

(151)

(6,422)(23,864)(4,725)(47,166)

2,789(1,829)14,115
199,813(37,249)
212,76264–(1,274)–

43–

212,762

175,513(5) Notes regarding consolidated financial statements[Notes on premise of a going concern]
None[Basis of presenting consolidated financial statements]
1) Scope of consolidation and application of the equity method of accounting
Number of consolidated subsidiaries: 114
Major companies:
Maruzen CHI Holdings Co., Ltd.
Hokkaido Coca-Cola Bottling Co., Ltd.
INTELLIGENT WAVE INC.
BUNKYODO GROUP HOLDINGS CO., LTD.
2Dfacto, Inc., DNP Color Techno Kameyama Co., Ltd.
DNP Technopack Co., Ltd., DNP Fine Chemicals Co., Ltd.
DNP Logistics Co., Ltd.
Number of equity-method affiliated companies: 15
Major companies:
Nihon Unisys, Ltd., BOOKOFF CORPORATION LIMITEDAll About, Inc., Kyoiku Shuppan Co., Ltd.
DIC Graphics Corporation
Photronics DNP Mask Corporation
MK Smart Joint Stock Company
2) Changes in scope of consolidation and application of the equity method of accounting(Scope of consolidation)
Newly included:
4 DNP Tamura Plastic Co., Ltd. and three other companies
Excluded:
2 DNP Signage Technology Co., Ltd. and one other company(Application of equity method)
Newly included:
5
Excluded:2

Publishing Marketing Innovation Japan Co., Ltd. and fourother companies
UD Alliance Technology Limited and one other company

3) Matters concerning the fiscal years of consolidated subsidiaries
Of the consolidated subsidiaries, Hokkaido Coca-Cola Bottling Co., Ltd. and 26 others have fiscal
years that end on December 31, while Maruzen CHI Holdings Co., Ltd. and 23 others have fiscal
years that end on January 31. Their financial statements as of the same date are used in the
preparation of these consolidated financial statements.
Additionally, INTELLIGENT WAVE INC.’s fiscal year ends on June 30, BUNKYODO GROUPHOLDINGS CO., LTD. and six other companies have fiscal years that end on August 31,
mobilebook.jp, Inc. and one other company have fiscal years that end on September 30, and DNP
Tamura Plastic Co., Ltd.’s fiscal year ends on October 31. Consequently, financial statements basedon provisional account settlements are used.
Any material transactions during the time between the foregoing settlement dates and provisional
settlement dates and the consolidated settlement date are adjusted for on a consolidated basis.

244) Summary of significant accounting policies(a) Criteria and methods for valuing significant assets• Marketable securities
Other securitiesThose with market
prices available

Those without market
prices available

Fair market value based on market prices as of the balance
sheet date
(The related valuation differences are directly included in net
assets and cost of sales is computed mainly by themoving-average method.)
Mainly cost based on the moving-average method• Derivatives

Mainly fair market value• Inventories

For figures shown on the balance sheet, the book value
write-down method based on the decrease in profitability isused.
Mainly cost based on the specific identification method

Merchandise
Finished products, work inprogress

Mainly cost based on the retail inventory cost method

Raw materials

Mainly cost based on the moving-average method

Supplies

Mainly cost based on the most recent purchase method(b) Depreciation and amortization of significant assets• Property, plant and equipment The Company and its domestic consolidated subsidiaries use
the declining balance method.
(except for lease assets)
However, depreciation of machinery and equipment at theKurosaki Plant No. 1 (2nd-Stage plant) and Plant No. 3 iscomputed by the straight-line method.
Depreciation of buildings (excluding building fixtures)acquired after April 1, 1998, is computed by the straight-line
method.
Assets with an acquisition cost of at least ¥100,000 and lessthan ¥200,000 are depreciated mainly over three years by
the straight-line method.
Foreign consolidated subsidiaries mainly use the straight-line
method.
• Intangible fixed assets(except for lease assets)

Mainly the straight-line method
Software used internally is amortized using the straight-line
method over the Company’s estimate of the useful life of theassets (five years).

• Lease assets

Lease assets with no transfer of ownership
These lease assets are depreciated over the lease periodusing the straight-line method with no residual value.

(c) Basis for recording significant allowances
To cover possible losses on doubtful accounts, the• Allowance for doubtful
allowance for doubtful accounts is based on historicalaccounts
default rates for normal accounts and on estimates of theamounts that may not be recoverable for specific overdue
accounts.
To cover payments of employee bonuses in the following• Reserve for bonuses
fiscal year, the reserve for bonus is based on the estimatedamount that is attributable to the current fiscal year.

25

(d) Accounting treatment of retirement benefits
Net defined benefit liability is recorded to prepare for employee retirement benefits at an
amount derived by subtracting pension plan assets from retirement benefit obligations basedon the amount expected at the end of the current fiscal year. In calculating retirement benefit
obligations, a benefit formula is used to allocate expected retirement benefit payments in the
period until the end of the current fiscal year.
Prior service costs are amortized using the straight-line method over a certain number ofyears that is equal to or less than the average future service period of eligible employees at thetime the costs are incurred (generally six years).
Actuarial gains/losses are amortized starting in the next fiscal year after they are incurred
using the declining balance method over a certain number of years that is equal to or less than
the average future service period of eligible employees at the time the actuarial gains/losses
are incurred (generally nine years).
Unrecognized actuarial gains/losses and unrecognized prior service costs are adjusted fortax effects and recorded in remeasurements of defined benefit plans in accumulated othercomprehensive income under net assets.
(e) Accounting treatment of consumption taxes
National and local consumption taxes are excluded from transaction amounts.
(f) Amortization of goodwill
Goodwill is amortized using the straight-line method for a period of not more than 20 years. In
the current fiscal year, straight-line amortization over five years is generally used.
(g) Scope of funds in the consolidated statements of cash flows
Cash and cash equivalents in the consolidated statements of cash flows are short-term
investments with an original maturity of three months or less, are subject to insignificant risk ofchanges in value, and can be easily converted into cash and drawable funds as needed.
[Changes in accounting policies]
Starting in the current fiscal year, DNP is applying the “Accounting Standard for Business
Combinations” (ASBJ Statement No. 21, September 13, 2013), the “Accounting Standard forConsolidated Financial Statements” (ASBJ Statement No. 22, September 13, 2013), the “AccountingStandard for Business Divestitures” (ASBJ Statement No. 7, September 13, 2013), and otheraccounting standards. As a result, DNP now records any differences resulting from changes in its
ownership interests in subsidiaries subject to ongoing control under capital surplus, and records
acquisition-related costs as expenses in the fiscal year in which they are incurred. Furthermore, forbusiness combinations carried out on or after the beginning of the current fiscal year, DNP now
reflects the updated acquisition cost allocation based on finalization of the provisional accounting
treatment in the consolidated financial statements for the fiscal year in which the businesscombination occurs. In addition, DNP has made changes in the presentation of net income and otheritems and has changed from presenting minority interests to presenting non-controlling interests. To
reflect these changes in presentation, DNP has restated the consolidated financial statements forthe previous fiscal year.
DNP is applying the Accounting Standard for Business Combinations and other accounting
standards in line with transitional measures stipulated in Paragraph 58-2 (4) of the AccountingStandard for Business Combinations, Paragraph 44-5 (4) of the Accounting Standard forConsolidated Financial Statements, and Paragraph 57-4 (4) of the Accounting Standard for26

Business Divestitures, and this application is effective from the start of the current fiscal year andinto the future.
In the consolidated statements of cash flows for the current fiscal year, DNP lists cash flows
related to the purchase or sale of stock in subsidiaries not resulting in a change in the scope of
consolidation in the category of cash flows from financing activities, and cash flows related toacquisition-related costs for stock in subsidiaries resulting in a change in the scope of consolidation
or expenses arising in relation to the purchase or sale of stock in subsidiaries not resulting in achange in the scope of consolidation in the category of cash flows from operating activities.
Additionally, DNP is not reclassifying comparable information, in line with transitional measures
stipulated in Paragraph 26-4 of the Practical Guidelines on Accounting Standards for Preparing
Consolidated Statements of Cash Flows.
These changes have an immaterial impact on the consolidated financial statements for the current
fiscal year.
The impact on per share information is listed in the relevant section.
[Consolidated balance sheets]

1. Guarantee obligation
2. Discounts on notes receivables

Year ended
March 31, 2015
¥22 million¥625 million

Year ended
March 31, 2016
¥6 million¥628 million

Year ended
March 31, 2015
¥31,748 million

Year ended
March 31, 2016
¥31,826 million[Consolidated statements of income]

1. Research and development expenses(Selling, general and administrative expenses)

27

[Consolidated statements of changes in net assets]
The year ended March 31, 2015 (April 1, 2014 – March 31, 2015)
1. Types and number of shares outstanding and treasury stock(Shares)

Outstanding shares

Stock type

Number ofshares at the
beginning of
the year
ended March
2015

Increase in
number ofshares during
the year
ended March2015

Common stock

700,480,693

Decrease in
number ofshares during
the year
ended March
2015–

Number ofshares at theend of theyear ended
March 2015–

700,480,693

Treasury stock
Common stock
56,586,830
62,594
1,810
56,647,614
Notes:
1. The increase of 62,594 treasury shares is due to the repurchase of odd-lot shares.
2. The decrease of 1,810 treasury shares comprises 1,668 shares from the sale of odd-lot shares,
132 shares from the return of shares sold by equity-method affiliates, and 10 shares fromchanges in equity ownership ratios in equity-method affiliates.

2. Stock acquisition rights and treasury stock acquisition rights
Number of shares (Shares)
Company name

Consolidated
subsidiary

Breakdown

Balance atthe end of
the year
ended
March 2015
(Million yen)

Stock
type

Beginning of
the year
ended March
2015

Increase

Decrease

End of theyear ended
March 2015

–

–

–

–

–

16

–

–

–

–

16

Dividend pershare (Yen)Dividend
record date

Effective dateStockacquisitionrights as stock
optionTotal

3. Detailed information regarding dividends(1) Dividends paid
Total dividends

Resolution

Stock type

General meeting ofshareholders on
June 27, 2014

Common stock

10,311

16

March 31,2014

June 30,
2014

Board of Directors’
meeting on
November 6, 2014

Common stock

10,31016

September 30,
2014

December 10,
2014(Million yen)

(2) Of dividends for which the record date belongs to the current fiscal year, those thatcome into effect in the following fiscal year
Resolution

Stock type

Total
dividends(Million yen)

General meeting ofshareholders on
June 26, 2015

Commonstock

10,310Source ofdividends
Retainedearnings

28

Dividend
per share
(Yen)

16

Dividend
record date

Effective
date

March 31,2015

June 29,2015

The year ended March 31, 2016 (April 1, 2015 – March 31, 2016)
1. Types and number of shares outstanding and treasury stock(Shares)

Stock type

Number ofshares at the
beginning of
the year
ended March
2016

Outstanding shares

Common stock

700,480,693–

20,000,000

680,480,693

Treasury stock

Common stock

56,647,614

15,275,962

20,003,999

51,919,577

Notes:

1.
2.

3.

Increase in
number ofshares during
the year
ended March2016

Decrease in
number ofshares during
the year
ended March
2016

Number ofshares at theend of theyear ended
March 2016

The total number of outstanding shares of common stock decreased by 20,000,000 shares dueto the cancellation of treasury shares by resolution of the Board of Directors.
The number of treasury shares of common stock increased by 15,275,962 shares due to theacquisition of 15,221,000 shares by resolution by the Board of Directors and the repurchase of
54,962 odd-lot shares.
The total number of treasury shares of common stock decreased by 20,003,999 shares due tothe cancellation of 20,000,000 treasury shares by resolution of the Board of Directors, the sale of
1,200 odd-lot shares, and 2,799 shares from changes in equity ownership ratios in equity-method
affiliates.

2. Stock acquisition rights and treasury stock acquisition rights
Number of shares (Shares)
Company nameBreakdown

Consolidated
subsidiaryStockacquisitionrights as stock
optionBalance atthe end of
the year
ended
March 2016
(Million yen)

Stock
type

Beginning of
the year
ended March
2016

Increase

Decrease

End of theyear ended
March 2016

–

–

–

–

–

16

–

–

–

–

16

Dividend pershare (Yen)Dividend
record date

Effective dateTotal

3. Detailed information regarding dividends(1) Dividends paid
Resolution
General meeting ofshareholders on
June 26, 2015
Board of Directors’
meeting on
November 10, 2015

Stock type

Total dividends(Million yen)

Common stock

10,31016

March 31,2015

June 29,
2015

Common stock

10,06616

September 30,
2015

December 10,
2015(2) Of dividends for which the record date belongs to the current fiscal year, those thatcome into effect in the following fiscal year
Resolution

Stock type

Total
dividends(Million yen)

General meeting ofshareholders on
June 29, 2016

Commonstock

10,065

Source ofdividends
Retainedearnings

29

Dividend
per share
(Yen)

16

Dividend
record date

Effective
date

March 31,2016

June 30,
2016

[Segment information, etc.][Segment information]
1. Overview of the reporting segments(1) Method of determining reporting segments
DNP’s reporting segments are regularly reviewed by the Board of Directors using thesegregated financial information available within each segment to determine the allocation ofbusiness resources and evaluate business results.
DNP bases its business divisions on the products and services provided and develops its
business activities based on a comprehensive domestic and overseas strategy for eachbusiness division. The four reporting segments are Information Communication, Lifestyle andIndustrial Supplies, Electronics, and Beverages.
(2) Products and services in each reporting segment
Information Communication is involved in the production and sale of publications, commercial
printed materials, business forms, and photographic materials and in educational andpublications distribution. Lifestyle and Industrial Supplies is involved in the production and saleof packaging materials, interior and exterior decorative printed materials, and industrial
supplies. Electronics is involved in the production and sale of precision electronic components
and other products. Beverages is involved in the production and sale of carbonated andnon-carbonated beverages.
(3) Changes in reporting business segments, etc.
DNP changed its reportable business segments effective from the current fiscal year.
DNP transferred the Imaging Communication business (includes photo printing) from theLifestyle and Industrial Supplies segment to the Information Communication segment in April
2015.
Segment information for the previous fiscal year has been prepared based on the newreportable business segments. This information is presented under “The year ended March 31,
2015 (April 1, 2014 – March 31, 2015)” in the section titled, “3. Information on sales,
income/loss, assets, and other items by reporting segment.”
2. Method of calculating sales, income/loss, assets, and other items by reporting
segment
The accounting method used for reporting business segments is generally the same as statedin “Basis of presenting consolidated financial statements.”
Reporting segment income figures are based on operating income. Inter-segment sales andtransfers are based on third-party transaction prices.
As noted in the section on changes in accounting policies, starting in the current fiscal year,
DNP now records any differences resulting from changes in its ownership interests in
subsidiaries subject to ongoing control under capital surplus, and records acquisition-related
costs as expenses in the fiscal year in which they are incurred.
These changes have an immaterial impact on segment profits in the current fiscal year.

30

3. Information on sales, income/loss, assets, and other items by reporting segment
The year ended March 31, 2015 (April 1, 2014 – March 31, 2015)(Million yen)Amounts
reported on
Adjustment
consolidated
Note 1
financialNote 2statements

Reporting segment
Information
Communication

Lifestyle andIndustrial
Supplies

Electronics

Outside customers
Inter-segment784,672
5,065

387,517
1,038

230,2978

59,6319

1,462,118
6,121

Beverages

Total

Net sales–(6,121)

1,462,118–
1,462,118

Total

789,737

388,556

230,305

59,6401,468,239(6,121)

Segment income

22,193

13,67625,904

1,076

62,851(14,677)

48,173

Segment assets

895,813450,645

310,315

46,3591,703,133

106,328

1,809,462

25,66817,60018,3773,840

65,488

1,545

67,033

1,991

5

17

0

2,015

–

2,015

61

–

–

17

79

–

79

23,343

12,59914,395

3,553

53,892

1,131

55,024

Other items
Depreciation andamortization
Amortization of
goodwill
Impairment loss
Increase in property,
plant and equipment
and in intangible fixed
assets
Notes:

1.

2.

Figures are adjusted as follows.
(1) Segment income is adjusted for costs related to basic research not assignable to a reporting
segment or costs of research shared by different segments.
(2) Segment assets are adjusted for companywide assets not allocated to reporting segments.
(3) Increases in property, plant and equipment and in intangible fixed assets are adjusted forcapital expenditures for the head office building and other items.
Segment income is adjusted to reflect operating income as reported in the consolidated financial
statements.

The year ended March 31, 2016 (April 1, 2015 – March 31, 2016)
Reporting segment(Million yen)Amounts
reported on
Adjustment
consolidated
Note 1
financialNote 2statements

Information
Communication

Lifestyle andIndustrial
Supplies

Electronics

Outside customers
Inter-segment

816,875
4,746

381,647
999

199,33020

58,06232

1,455,916
5,798–(5,798)1,455,916–

Total

821,622382,647

199,350

58,094

1,461,714(5,798)1,455,916

Beverages

Total

Net sales

Segment income

29,363

12,597

20,508991

63,460(17,988)

45,471

Segment assets

892,968

441,761

273,40245,7991,653,933

64,703

1,718,636

27,51517,02515,007

3,940

63,4891,820

65,310

1,593

606

–

1

2,200

–

2,200

102

–

–

7

109

–

109

52,537

23,277

13,276

5,780

94,871

2,392

97,264

Other items
Depreciation andamortization
Amortization of
goodwill
Impairment loss
Increase in property,
plant and equipment
and in intangible fixed
assets
Notes:

1.

2.

Figures are adjusted as follows.
(1) Segment income is adjusted for costs related to basic research not assignable to a reporting
segment or costs of research shared by different segments.
(2) Segment assets are adjusted for companywide assets not allocated to reporting segments.
(3) Increases in property, plant and equipment and in intangible fixed assets are adjusted forcapital expenditures for the head office building and other items.
Segment income is adjusted to reflect operating income as reported in the consolidated financial
statements.

31

[Related information]
The year ended March 31, 2015 (April 1, 2014 – March 31, 2015)
1. Information on products and services
Omitted because similar information is disclosed in segment information.
2. Regional information(1) Net sales(Million yen)Japan
1,231,913
Notes:

1.
2.
3.

Asia

Other regions

160,680

Total

69,524

1,462,118

Sales are classified by country or region, based on the location of customers.
Country and regional segments are based on geographic proximity.
Main countries and regions included in each segment:
Asia:
South Korea, Taiwan, China, Indonesia
Other:
United States, France, United Kingdom, Germany(2) Property, plant and equipment
Omitted because the value of property, plant and equipment located in Japan is over 90%of the value of property, plant and equipment as reported in the consolidated balance
sheets.
3. Information on major customers
Not described because sales to specific outside customers are less than 10% of sales asreported in the consolidated statements of income.
The year ended March 31, 2016 (April 1, 2015 – March 31, 2016)
1. Information on products and services
Omitted because similar information is disclosed in segment information.
2. Regional information(1) Net sales(Million yen)Japan
1,221,329
Notes:

1.
2.
3.

Asia

Other regions

146,925

Total

87,6601,455,916

Sales are classified by country or region, based on the location of customers.
Country and regional segments are based on geographic proximity.
Main countries and regions included in each segment:
Asia:
South Korea, China, Taiwan, Indonesia
Other:
United States, France, United Kingdom, Germany(2) Property, plant and equipment
Omitted because the value of property, plant and equipment located in Japan is over 90%of the value of property, plant and equipment as reported in the consolidated balance
sheets.
3. Information on major customers
Not described because sales to specific outside customers are less than 10% of sales asreported in the consolidated statements of income.

32

[Per share information]
Year ended March
31, 2015(April 1, 2014 –March 31, 2015)

Year ended March
31, 2016(April 1, 2015 –March 31, 2016)

Net assets per share¥1,675.63¥1,618.66

Net income per share¥41.82¥53.10

Diluted net income per share¥41.44¥53.07

Year ended
March 31, 2015

Year ended
March 31, 2016

(As of March 31,
2015)(As of March 31,
2016)

Note: Basis of calculations
1. Net assets per share(Million yen)

1,124,093
45,26416
45,248

Net assets at fiscal year-end pertaining to common
stock(Million yen)

1,078,828

1,017,425

Number of common shares outstanding(Thousand shares)

Number of common treasury shares(Thousand shares)

700,480
56,647680,480
51,919Number of common shares at fiscal year-end used
for the calculation of net assets per share(Thousand shares)

643,833

628,561

Year ended
March 31, 2015
(April 1, 2014 –March 31, 2015)

Year ended
March 31, 2016
(April 1, 2015 –March 31, 2016)(Million yen)

26,92333,587(Million yen)––

(Million yen)

26,92333,587643,867

632,591(Million yen)

(240)

(18)

(Million yen)

(240)

(18)

–

–

Total net assets(Million yen)Amount excluded from total net assets(Million yen)

Of which, stock acquisition rights(Million yen)

Of which, non-controlling interests

1,063,241
45,81616
45,8002. Net income per share and diluted net income per share(1) Net income per share
Net income attributable to parent company
shareholders
Amounts not attributable to commonshareholders
Net income attributable to parent company
common shareholders
Average number of common shares outstanding
during the fiscal year

(Thousand shares)(2) Diluted net income per share
Adjustments to net income attributable to parent
company shareholders
Of which, impact of dilutive stock of consolidated
subsidiaries and affiliates
Increase in common stock(Thousand shares)

3. As noted in the section on changes in accounting policies, DNP now applies the AccountingStandard for Business Combinations.
This change has an immaterial impact in the current fiscal year on net assets per share, net
income per share, and diluted net income per share.

33

[Significant subsequent events]
None[Disclosure omission]
Disclosure of notes on such items as tax effect accounting, marketable securities, and retirement
benefits is omitted because such disclosure in the release of Financial Results is not considered to
be important.

34

6. Non-consolidated financial statements(1) Non-consolidated balance sheets(Million yen)

Year ended
March 31, 2015
(As of March 31, 2015)

Year ended
March 31, 2016
(As of March 31, 2016)

121,001
43,790263,459
4,401
9,339
1,514
3,972
27,816(1,031)
474,263

83,59845,223245,389
5,344
10,068
1,396
5,845
34,676(1,342)
430,199408,262(270,025)
138,237
32,026(25,661)
6,365
577,832(518,456)
59,375
1,301(1,177)
124
49,224(41,492)
7,732
131,049
1,858(1,057)
801
38,694382,379

450,099(280,093)
170,005
33,587(26,290)
7,297
581,893(529,119)
52,774
1,326(1,239)86
51,607(40,465)
11,142131,032
1,939
(970)
969
9,544
382,851

20,651
2,628
23,28020,5902,095
22,686

341,749
149,978
2,922
13,14456,265(14,177)
549,883
955,543
1,429,806

302,122
158,432
2,922
12,38063,851(12,920)526,790932,328
1,362,528

ASSETS
Current assets
Cash and time deposits
Notes receivable
Trade receivable
Merchandise and finished goods
Work in progress
Raw materials and supplies
Deferred income taxes
Other
Allowance for doubtful accounts
Total current assets
Fixed assets
Property, plant and equipment
Buildings
Accumulated depreciation
Buildings, net
Structures
Accumulated depreciation
Structures, net
Machinery
Accumulated depreciation
Machinery, net
VehiclesAccumulated depreciation
Vehicles, net
Equipment
Accumulated depreciation
Equipment, net
Land
Lease asset
Accumulated depreciation
Lease asset, net
Construction in progress
Total property, plant and equipment
Intangible fixed assets
Software
Other
Total intangible fixed assets
Investments and other assets
Investment securities
Investments in securities in affiliates
Investments in capital of affiliates
Long-term loans
Other
Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
TOTAL ASSETS

35

(Million yen)

Year ended
March 31, 2015
(As of March 31, 2015)

Year ended
March 31, 2016
(As of March 31, 2016)

14,016
213,667
268
39,966
16,028
1,974
198,237
7,556
148
106
644
374
492,988

10,750206,811313
36,88919,8992,604
189,105
7,557
141
–
881
–
474,954

100,000
574
1,124
5,994
7,688
72
52,938168,393661,382

100,000
945
1,145
5,963
8,297
72
44,781
161,206
636,160

114,464

114,464

144,898
144,898

144,898
144,898

23,30023,300

0

0

29

27

382,780
51,105457,215(94,329)622,248

332,780
70,156426,264(80,972)
604,655

146,176

121,712(0)
146,175
768,424
1,429,806–
121,712726,367
1,362,528

LIABILITIESCurrent liabilities
Notes payable
Trade payable
Lease obligations
Accounts payable - otherAccrued expenses
Advances received
Deposits payable
Reserve for bonuses
Reserve for bonuses to directors
Provision for loss on liquidation of affiliates
Notes payable for facilities
Other
Total current liabilities
Long-term liabilities
Bonds
Lease obligations
Asset retirement obligations
Long-term accounts payable
Provision for retirement benefits
Reserve for environmental measures
Deferred tax liabilities
Total long-term liabilities
TOTAL LIABILITIESNET ASSETSStockholders’ equity
Common stock
Capital surplus
Capital reserve
Total capital surplus
Retained earnings
Legal reserve
Other retained earnings
Reserve for special depreciation
Reserve for depreciation reduction of fixed
assetsOther reserve
Retained earnings brought forward
Total retained earnings
Treasury stock
Total stockholders’ equity
Valuation and translation adjustments
Valuation difference on available-for-salesecurities
Net deferred losses on hedges
Total valuation and translation adjustments
TOTAL NET ASSETSTOTAL LIABILITIES AND NET ASSETS

36

(2) Non-consolidated statements of income(Million yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating loss
Non-operating income
Interest income
Dividend income
Other
Total non-operating income
Non-operating expenses
Interest expense
Other
Total non-operating expenses
Ordinary income
Extraordinary gains
Gain on sale of fixed assets
Gain on sale of investment securities
Other
Total extraordinary gains
Extraordinary losses
Loss on sale or disposal of fixed assets
Loss on devaluation of investment securities
Loss on devaluation of securities in affiliates
Repair costs
Other
Total extraordinary losses
Income before income taxes
Current income taxes
Deferred income taxes
Total income taxes
Net income

37

Year ended
March 31, 2015
999,023882,293
116,729
117,198(469)

Year ended
March 31, 2016
1,001,026
880,119
120,906
122,449(1,542)

222
19,13536,851
56,209226
25,083
34,84160,151

1,575
29,73931,31524,424

1,614
28,78930,40328,206

34
4,147
2,249
6,431

48
14,594380
15,023

1,661
16
10
–
53
1,741
29,115
330
6,921
7,251
21,863

1,225
923
3,619
7,672
243
13,68429,545
1,580
5,117
6,697
22,848

(3) Non-consolidated statements of changes in net assets
The year ended March 31, 2015 (April 1, 2014 – March 31, 2015)(Million yen)
Stockholders’ equity
Capital surplus
Commonstock

Balance at the beginning ofcurrent period
Cumulative impact ofaccounting changes
Balance at the beginning ofcurrent period reflecting
accounting changes

114,464

114,464Retained earnings
Other retained earnings

Capitalreserve

Total capitalsurplusLegalreserve

144,898

144,898

23,300144,898

144,898

23,300Reserve for
specialdepreciation

Reserve fordepreciation
reduction of
fixed assets

Other
reserve

Retainedearnings
brought
forwardTotal
retainedearnings

26

34

382,780

61,584

467,725

3,676

3,676

65,261

471,402

26

–

5

–

(20,621)(20,621)

21,863

21,863(1)(1)(15,427)(15,427)26

34

382,780

Changes of items during theperiodReversal of reserve for
special depreciation(26)

Reversal of reserve fordepreciation reduction of
fixed assets(5)

Cash dividends paid
Net income
Purchases of treasury stock
Disposal of treasury stock
Decrease from corporate
divestiture
Net changes in items otherthan stockholders’ equity
Total changes of items during
the period

–

–

–

–

(26)

(5)

–

(14,155)(14,187)

Balance at the end of current
period114,464

144,898

144,898

23,300029

382,780

51,105457,215

Stockholders’ equity

Balance at the beginning ofcurrent period

Treasury
stock

Total
stockholders’equityValuationdifferenceonavailablefor-salesecuritiesNet
deferred
gains(losses)onhedgesTotalvaluationandtranslation
adjustments

Total
net
assets(94,265)

632,822

33,340(0)33,339666,162

Cumulative impact ofaccounting changes
Balance at the beginning ofcurrent period reflecting
accounting changes
Changes of items during theperiodReversal of reserve for
special depreciation
Reversal of reserve fordepreciation reduction of
fixed assets

3,676(94,265)

33,340(0)33,339669,839–––(20,621)(20,621)

21,863

21,863

(66)

(66)

(66)

2

1

1

(15,427)(15,427)

Net income
Disposal of treasury stock

636,499

3,676–

Cash dividends paid
Purchases of treasury stock

Valuation and translation adjustments

Decrease from corporate
divestiture
Net changes in items otherthan stockholders’ equity–

112,836(0)

112,835

112,835

Total changes of items during
the period(64)(14,251)

112,836(0)

112,835

98,584

Balance at the end of current
period(94,329)622,248

146,176(0)

146,175

768,424

38

The year ended March 31, 2016 (April 1, 2015 – March 31, 2016)(Million yen)
Stockholders’ equity
Capital surplus
Commonstock

Balance at the beginning ofcurrent period

114,464Retained earnings
Other retained earnings

Capitalreserve

Total capitalsurplusLegalreserve

144,898

144,898

23,300Reserve for
specialdepreciation

Reserve fordepreciation
reduction of
fixed assets

Other
reserve

Retainedearnings
brought
forwardTotal
retainedearnings

029

382,780

51,105457,215

0

–

1

–

Changes of items during theperiodReversal of reserve for
special depreciation(0)

Reversal of reserve fordepreciation reduction of
fixed assets(1)(50,000)

Reversal of other reserves
Cash dividends paid
Net income

50,000–(20,376)(20,376)

22,84822,848Purchases of treasury stock
Disposal of treasury stock
Cancellation of treasury stock

(0)

(0)

(33,422)(33,422)Net changes in items otherthan stockholders’ equity
Total changes of items during
the period

–

–

–

–

(0)

(1)

(50,000)

19,050(30,950)

Balance at the end of current
period114,464

144,898

144,898

23,300027

332,780

70,156426,264

Stockholders’ equity

Balance at the beginning ofcurrent period
Changes of items during theperiodReversal of reserve for
special depreciation

Treasury
stock

Total
stockholders’equityValuationdifferenceonavailablefor-salesecuritiesNet
deferred
gains(losses)onhedgesTotalvaluationandtranslation
adjustments

Total
net
assets(94,329)622,248

146,176(0)

146,175

768,424

Reversal of reserve fordepreciation reduction of
fixed assets
Reversal of other reserves
Cash dividends paid
Net income
Purchases of treasury stock
Disposal of treasury stock
Cancellation of treasury stock

Valuation and translation adjustments(20,066)

–

–

–

–

–

–

(20,376)(20,376)

22,84822,848(20,066)(20,066)

1

1

1

33,422––

Net changes in items otherthan stockholders’ equity–(24,463)0(24,463)(24,463)

Total changes of items during
the period

13,357(17,593)(24,463)0(24,463)(42,056)

Balance at the end of current
period(80,972)

604,655

121,712–

121,712726,367(4) Notes regarding non-consolidated financial statements[Notes on premise of a going concern]None39