Financial Results for the Third Quarter
From June 1, 2020 to February 28, 2021
ERI Holdings Co., Ltd.
March 30, 2021

Evaluation,Rating,Inspection

Holdings
1Impact of coronavirus (COVID-19)

Year-on-year changes of the number of main services
Number of Building Confirmation by ERI group
Number of Housing Design Performance Evaluation of detached houses of ERI group
Number of Building Confirmations nationwide
Number of Housing Design Performance Evaluation of detached houses nationwide
30%
Consumption tax expansion（8%→10％）20%
COVID-19
10%

2nd1stEmergency declaration
0%-10%-20%-30%

Jun.
2019

Jul.

Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Jun.
2020

Jul.

Aug. Sep. Oct. Nov. Dec. Jan. Feb.
2021
Copyright © 2019 ERI holdings. All rights reserved2Summary
Decrease in revenue and earnings year-on-year











Both ordinary income and net income returned to profit by abottoming out of orders and continual cost reduction efforts.
The third quarter result has been back on the recovery track in linewith our initial expectations.
Partly due to an influence by the second issuance of the state ofemergency declaration, our client’s operational restraint still havepersisted by COVID-19.
Both new housing and non-housing starts were still sluggish, howevera shrink of new housing starts became more moderate.
Both Building Confirmation and Inspection and Housing Performance
Evaluation services revenue decreased due to new housing and nonhousing starts slowdown.
Solution and Other services revenue also decreased.
Copyright © 2019 ERI holdings. All rights reserved3Consolidated financial results
3Q previous
fiscal year

3Q reporting
fiscal year

(Jun. 2019–Feb. 2020)(Jun. 2020–Feb. 2021)

11,102

10,363

▲738

▲6.7%

Operating Profit

32022▲298▲93.1%

Operating Profit Ratio

2.9%

0.2%

--Ordinary Profit38286▲296▲77.4%

Ordinary Profit Ratio

3.4%

0.8%

--Profit Attributable toOwners of Parent

211

29▲181▲85.9%

Profit per Share (Yen)

27.62

3.83

▲23.79▲86.1%(Millions of yen)

Net Sales

ChangeAmountsRatio* 3Q reporting includes P/L numbers of Sakoken Co., Ltd. third quarter, from Oct. 2020 to Dec. 2020.

Copyright © 2019 ERI holdings. All rights reserved4Consolidated financial results by segment(Millions of yen)

3Q previous 3Q reporting
fiscal year
fiscal year
(Jun. 2019–Feb. 2020)

Change(Jun. 2020–Amounts
Feb. 2021)

Ratio

Segment
ProfitChangeBuilding Confirmation
and Inspection and its
related services

5,958[53.7%]

5,741[55.4%]

▲217

▲3.6%

106

▲106

Housing Performance
Evaluation and its
related services

2,899[26.1%]

2,608[25.2%]▲291 ▲10.1%

47

▲82

Solution Services

978[8.8%]837[8.1%]▲141 ▲14.4%▲37▲105Others

1,266[11.4%]

1,177[11.3%]▲88▲7.0%▲46▲2Net Sales Total

11,102[100.0%]10,363[100.0%]

▲738

▲6.7%

70▲297* 3Q reporting includes P/L numbers of Sakoken Co., Ltd. third quarter, from Oct. 2020 to Dec. 2020.

Copyright © 2019 ERI holdings. All rights reserved5Main operating figures | Consolidated
3Q previous
fiscal year

(Jun. 2019 – Feb. 2020)

Cases

Amounts(Millions of Yen)

3Q reporting
fiscal year

Change(Jun. 2020 –Feb. 2021)

Cases

Amounts(Millions of Yen)

Cases

Amounts(Millions of Yen)

Building Confirmations

58,1322,450

51,154

2,286▲6,978▲164Final Inspections

54,8592,260

51,642

2,217▲3,217▲43

Detached
Houses28,338752

22,964698▲5,374▲54

Collective
Houses

20,008201

16,228183▲3,780▲18

Detached
Houses24,3901,375

22,372

1,212▲2,018▲163Collective
Houses15,429240

15,302

238

▲127

▲2

Housing Design
Performance
Evaluations

Housing
Construction
Performance
Evaluations* 3Q reporting includes numbers of Sakoken Co., Ltd. third quarter, from Oct. 2020 to Dec. 2020.

Copyright © 2019 ERI holdings. All rights reserved6Key service figures | Consolidated
3Q previousfiscal year(Jun. 2019 – Feb. 2020)

Cases

Amounts(Millions of Yen)

3Q reporting
fiscal yearChange(Jun. 2020 –Feb. 2021)

Cases

Amounts(Millions of Yen)

Cases

Amounts(Millions of Yen)

Building Confirmations for
medium to large sizebuildings (over 500 sqm)

3,727

1,088

3,447

1,036

▲280

▲52

Technical Assessments forLong-life Quality Housings

21,757298

18,068254▲3,689▲44Inspections for Housing
Defect Liability Insurance

30,335279

28,177247▲2,158▲32

Evaluation for Compliancewith Energy Consumption
Performance of Buildings

1,219

196

1,166183▲53▲13Nonhousings

1302616033307Housings

4,294

79

5,838

103

1,544

24BELSCertifications* 3Q reporting includes numbers of Sakoken Co., Ltd. third quarter, from Oct. 2020 to Dec. 2020.
* “Building Confirmations for medium to large size buildings (over 500 sqm)” includes the numbers of plan change.
* “Technical Assessments for Long-life Quality Housings” represents the numbers and amounts of conformance certificate, which includes the numbers and amounts of extension andrenovation. The numbers of plan change is included.
* Counting rules of “Inspections for Housing Defect Liability Insurance” is as follows. 1) Including Defect Insurance but excluding inspection for insurance firm and Housing Performance
Certification, 2) Including insurance brokerage, and 3) Including the data of all housing defect liability insurance companies.
* From FY 5/2020 report, “Evaluation for Compliance with Energy Consumption Performance of Buildings” excludes the numbers of plan change.

7Changes of quarterly results | Consolidated

Copyright © 2019 ERI holdings. All rights reserved8Forecasts for FY 5/2021
ChangeFY 5/2020

FY 5/2021(Jun. 2019 –May 2020)(Jun. 2020 –May 2021)

14,842

14,546▲296▲2.0%

Operating Profit

517273▲244▲47.2%

Operating Profit Ratio

3.5%

1.9%

--Ordinary Profit598

300▲297▲49.7%

Ordinary Profit Ratio

4.0%

2.1%

--Profit Attributable toOwners of Parent

258

157

▲101

▲39.2%

Profit per Share (Yen)

33.69

20.31

▲13.38▲39.7%(Millions of yen)

Net SalesAmounts

Ratio

Copyright © 2019 ERI holdings. All rights reserved

9Forecasts for FY 5/2021
Although the state of emergency declaration issued again, our clients’business operation, especially in severely depressed housing sector,
have been resuming evidently.
However, we should pay close attention watch on the COVID-19
disruption whether it will successfully shake down without further
infection rebounds.
So far, our business has been going in line with the earlier assumption
and we have kept an initial forecast.
Quarterly results and fiscal year end forecast

Copyright © 2019 ERI holdings. All rights reserved

10Topics
Digitalization 1 : Fire department’s consent
Japan ERI carried out the industry-first online fire department’s consent※in Building Confirmation procedure.
So far, fire authorities have requested a paper design document for their consent
procedure. With this case as a start, we expect a spread of online fire department’s
consent, which is beneficial to work efficiency.
E-filling flow

* If a building is the one prescribed in article 93 of the Building Code, a Designated Confirmation and Inspection Body may not
make a Building Confirmation without the consent by the competent fire department. Fire authorities conducted 230 thousand
fire department’s consent in 2019 (2020 White Paper on Fire Service).
Copyright © 2019 ERI holdings. All rights reserved11Topics
Digitalization 2 : Periodic Refresher Courses for Licensed
Architects
ERI Academy started Online Periodic Refresher Courses for Licensed
Architects in place of seminars gathered at the venue.
At anyhours

Easy online
signupAt anyPlacesWatching
online video
education

About onehour test

Selecting a venue,
date and time of thecourse completion test

For one of the COVID-19 countermeasures, MLIT eased the procedure requirements ofperiodic refresher courses and accepted online course implementation.
Responding quickly, ERI Academy started Online Periodic Refresher Courses from Jan.
2021. It has been well-received by many course participants currently working from home.
Copyright © 2019 ERI holdings. All rights reserved

12Topics
From April 2021, an enhancement of Mandatory Energy
Saving Standards starts
1. Minimum bldg. volume of the mandatory requirement is expanded from 2,000 sqm to 300 sqm
2. Tightening of supervision for larger than 300 sqm housings and utilization of Housing
Performance Evaluation and BELS
3. Regarding smaller than 300 sqm bldgs./housings, architects are required to explain energy
efficiency condition to the contracteesExpected volume ofmarket expansion
14,000 bldgs. per year＊1

Non-housing

3,246 bldgs.

14,144 bldgs.

Large scale
floor area
≥ 2,000 sqm

Mandatory compliance【prerequisite for
Building Confirmation】

Medium scale

Mandatory compliance【prerequisite forfloor area
300 sqm – 2,000 sqm Building Confirmation】

Small scale*1 source: Number of bldgs. is FY 3/2018
data from MLIT 2021 publication

Expected volume offiling required units
366,000 units per year＊2

New requirements （Apr. 2021～）

Floor area
< 300 sqm

Explain required

Housing
Filing required【tightening ofsupervision andrationalization of
filing with Housing
Performance
Evaluation/BELS】

Explain required

Most of mid/large scale
housings are collectivehousings
Penetration rate of
Housing Performance
Evaluation in Collectivehouses is 20～25％
Penetration rate of BELS
in Collective houses isroughly 1％
Expecting expansion of
Housing Performance
Evaluation/BELS needs*2 source: Number of units is
FY 3/2016 data from MLIT 2018
publication

Copyright © 2019 ERI holdings. All rights reserved13

Topics
From FY 3/2026, mandatory energy saving standards will
cover all buildings include housings
April 2021, committee will start discussion and conclude a plan around this summer（by Nikkei newspaper, March 5, 2021）
New requirements （FY 3/2026～）

Non-housing

Housing

Large scale

Mandatorycompliance【from 2019】

Mandatorycompliance

Medium scale

Mandatorycompliance【from 2021】

floor area
≥ 2,000 sqm

floor area
300 sqm – 2,000 sqm

Small scale
Floor area
< 300 sqm

Mandatorycompliance

Mandatorycompliance

Expected volume of filing
required bldgs.
493,000 bldgs. per year＊* source: Number of bldgs. is FY 3/2018
data from MLIT 2021 publication
Copyright © 2019 ERI holdings. All rights reserved14Topics
Certified as a “Health and Productivity Management
Organization 2021”
March 4, 2021, Japan ERI was certified as a “Health and Productivity Management
Organization 2021 (large corporate category)” in the Health and Productivity Management
Organization Certification System, which has established by METI as a way to commend
companies that carry out particularly excellent health and productivity management.

Certification by Nippon Kenko Kaigi (Japan Health Council)

December 2019, under the philosophy of “employees and their family health is the core of sustainable businessgrowth”, Japan ERI declared “Health Management Manifesto”, and developed a health management promotion
plan to make employees and their family life vibrant though their daily work. In the plan, we set quantitative
targets against major health concerns and have been proactively engaged in promotion of employees’ healthawareness, prevention of lifestyle-related diseases, constant review of work style, etc.
Copyright © 2019 ERI holdings. All rights reserved

15

Contact
ERI Holdings Co., Ltd.
Investor Relations and Public Relations Group
E－Mail ｜ info@h-eri.co.jp
https://www.h-eri.co.jp/
This release contains forward-looking statements
about ERI Holdings Co., Ltd.’s future plans,strategies, beliefs and performance that are nothistorical facts. Such statements are based on thecompany’s assumptions and risks, uncertainties andassumptions that, without limitation, relate toeconomic conditions. Accordingly, ERI Holdings Co.,
Ltd. wishes to caution readers that actual results
may differ materially from those projected in thisrelease and ERI Holdings Co., Ltd. bear no
responsibility for any negative impact caused by theuse of this release.

Copyright © 2019 ERI holdings. All rights reserved16