【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between the translated document and the original Japanese document, the latter shall prevail.

Summary of Consolidated Financial Results for the 3rd Quarter of the Fiscal YearEnding March 2018 (Based on Japanese GAAP)
February 14, 2018
Listed company namePERSOL HOLDINGS CO., LTD.

Stock code:

2181

Representative(Title)Inquiries(Title)

URL: https://www.persol-group.co.jp
President, Representative
Masamichi Mizuta
Director and CEO
Director, Executive Officer
Kiyoshi Seki
(Chief Financial Officer)

Scheduled date to filequarterly report:

February, 2018

Stock Exchange Listing: Tokyo

TEL +81 03-3375-2220

Scheduled date to commence dividend payments:―

Preparation of supplementary quarterly results explanatory material yes/no: yes
Quarterly results briefing session yes/no: no(Amounts less than JPY 1 million rounded down)
1. Consolidated Results for the 3rd Quarter of the Fiscal Year Ending March 2018 (April 1, 2017 - December 31, 2017)(1) Consolidated Operating Results (cumulative)(% indicates ratio of change from same quarter last year)
Current net profit
Sales
Operating profit
Ordinary profit
Quarterly net profit
JPY
JPY
JPY
JPY
%
%
%
%
MillionMillionMillionMillion3rd Quarter of the Fiscal
495,085
15.3
25,8992.4
26,104
1.5
10,872-27.6
Year Ending March 2018
3rd Quarter of the Fiscal
429,560
14.3
25,28721.0
25,70822.8
15,024
18.6
Year Ended March 2017
Note:
Comprehensive
income3rd Quarter of fiscal year

11,403ending March 2018

JPY

3rd Quarter of fiscal(-24.0％)Million

14,999year ended March 2017

Quarterly net profit per share

Quarterly net profit per share after
adjustment for dilution

JPY

JPY

46.55

46.55

64.00

63.82

3rd Quarter of fiscal year
ending March 2018
3rd Quarter of fiscal year
ended March 2017

JPY
Million(13.4%)(2) Consolidated Financial Position
Total assets
3rd Quarter of fiscal year ending March 2018
FY ended Mar 2017
Reference: Equity capital

Net assets

JPY Million
392,334
268,364

3rd Quarter of fiscal year
ending March 2018

JPY

145,950

MillionEquity ratio

JPY Million
159,657
153,816
FY ended Mar 2017

139,119

2. Dividend Status
Annual Dividend
End Q1End Q2End Q3End of FY

Total

JPY

JPY

JPY

JPY

JPY

FY ended Mar 2017

－

8.00

－

9.00

17.00

FY ending Mar 2018
FY ending Mar 2018
(Forecast)

－

9.00

－
9.00

18.00

－

1 －

%
37.2
51.8
JPY
MillionNote: Revision of most recently announced dividend forecast yes/no: no
3. Forecast of Consolidated Financial Results for the Fiscal Year Ending March 2018 (April 1, 2017 - March 31, 2018)

Sales

Full YearJPY
Million732,300%
23.7(% indicates ratio of change from same quarter last year)
Current period net
Current period
profit attributable toOperating profit
Ordinary profit
net profit per
parent company
share
shareholders
JPY
JPY
JPY
%
%
%
JPY
MillionMillionMillion36,0007.8
36,5006.9
18,6674.8
79.92

Note: Revision of most recently announced financial results forecast yes/no: yes※ Explanatory Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in a change in thescope of consolidation): yes
New:
4 companies (company names) Programmed Maintenance Services Pty Ltd
Programmed Health Professionals Pty Ltd
Programmed Integrated Workforce Limited
Programmed Skilled Workforce Limited
Excluded: －(company names)(2)

Application of special accounting treatment when preparing quarterly consolidated financial statements: no(3) Changes in accounting policies/changes in accounting estimates/restatement of prior period financial statements① Changes in accounting policies due to revisions to accounting standards etc.
: no
② Changes in accounting policies other than ①: no③ Changes in accounting estimates: no④ Restatement of revised statements: no(4) Number of fully issued shares (ordinary shares)① Number of fully issued sharesat period end (including
treasury stock)Q3 of fiscal year
ending March 2018236,677,955 Shares

Q3 of fiscal year

② Treasury stock at period end

ending March

3,407,096

Shares

2018③ Average number of shares
during the period (cumulative
quarter)

FY ended
Mar 2017

FY ended
Mar 2017

236,673,651 Shares

2,838,299

SharesQ3 of fiscal

Q3 of fiscal year
ending March 2018

233,557,977 Shares

year ended

234,771,108 Shares

March 2017

Note: Number of treasury stock at the end of period: Includes PHD shares held in the "Director Compensation BIP(Board Incentive Plan) trust account", and the "Employee Stock Ownership Plan trust account" ("ESOP
Trust") (3Q of fiscal year ending March 2018: 590,033 shares). Furthermore, PHD shares held in the "Director
Compensation BIP (Board Incentive Plan) trust account", and the "Employee Stock Ownership Plan trust
account" ("ESOP Trust") are included in treasury stock which are deducted when calculating the average
number of shares held in the period.

※ The quarterly summary of financial results is not subject to a quarterly review※ Explanation of appropriate usage of financial results forecasts and other special explanatory notes
The financial results outlook etc. and forward looking statements noted in this material are based on certain
assumptions PHD deems rational and information currently at hand, which are not meant to be taken as an
assurance by PHD that outcomes will be realized. Furthermore, actual financial results etc. may vary greatly due tovarious factors.
－

2 －○ Contents of Attachments
1. Qualitative information regarding the financial results for this quarter ………………………………………………

4(1) Explanation regarding business performance………………………………………………………………………

4(2) Explanation regarding the financial position…………………………………………………………………………

7(3) Explanation regarding future forecast information (Consolidated results forecast etc.) ………………………

7

2. Quarterly consolidated financial statements & main explanatory notes………………………………………………

8(1) Quarterly consolidated balance sheet………………………………………………………………………………

8(2) Quarterly consolidated profit and loss statement & quarterly consolidated comprehensive income statement 10
Quarterly consolidated profit and loss statement………………………………………………………………
Consolidated cumulative 3rd quarter
period……………………………………………………………………
Quarterly consolidated comprehensive income statement……………………………………………………
Consolidated cumulative 3rd quarter
period……………………………………………………………………
(3) Explanatory notes regarding quarterly consolidated financial statements………………………………………

10(Explanatory notes regarding ongoing concern assumptions……………………………………………………

12(Explanatory notes in the event of significant changes in the amount of shareholders’ equity)………………
(Application of special accounting treatment when preparing the quarterly consolidated financial
statements) ……………………………………………………………………………………………………………
(Segment information etc.) …………………………………………………………………………………………

12(Corporate Mergers & Acquisitions Related)………………………………………………………………………

15

－

3 －

10
11
11
12

12
13

1. Qualitative information regarding the financial results for this quarter(1) Explanation regarding business performance
The direction of Japan's economy continued to be unclear during the consolidated cumulative third quarter
period due to changes in political conditions overseas, trends in financial policy, and rising geopolitical risk etc.
Under these circumstances, there was a transition to a moderate economic recovery due to the government's
economic and financial policies etc. which on the whole resulted in expansion of corporate earnings.
The employment situation: a condition close to full employment continued. The 2017 effective ratio of job offers
to job seekers (seasonally adjusted) averaged at a multiple of 1.50; the highest recorded level in 44 years.
Furthermore, Japan's annual overall unemployment rate in 2017 stood at 2.8%; the first time in 23 years thatJapan has experienced full-employment. The basis underlying this type of market environment is a shortage ofworkers being pursued by a lot of demand. The HR services related market overall transitioned towards anexpansionary trend. PERSOL Group also found itself in a situation where demand from client firms for talenttended to be robust. In particular, the core temporary staffing segment business witnessed a trend of highlevels of temp worker deployments, and the placement business also experienced major increases in the numberof successfully placed candidates. The outcome of this was that results improved favorably.
In light of this type of economic environment, PERSOL Group proceeded with measures to further enhancebrand recognition. The trading name was changed to "PERSOL HOLDINGS" (July 2017), and the trading namesof major core companies were altered to reflect this new "PERSOL" branding. PERSOL Group is an integrated
HR services group that encompasses a diverse range of HR solutions: the core temporary staffing business,placement/recruitment, part-time/casual work hiring support, outsourcing/design and development in the
IT/engineering space, and BPO etc. PERSOL Group strives wholeheartedly to offer solutions that resolve
labor/hiring challenges.
Moreover, 100% of the fully issued shares of Programmed Maintenance Services Limited ("Programmed Ltd")
were acquired and Programmed Ltd became a PERSOL subsidiary as part of PERSOL's efforts in relation to the
HR services market in the Asia Pacific region. In future, solid business platform of Programmed Ltd will be
leveraged by PERSOL which aims to strengthen competitiveness and become the largest HR services company
in the APAC region.
As a result of the above, sales during this consolidated cumulative 3rd quarter were JPY 495,085 million (up15.3% year-on-year (YOY)), operating profit was JPY 25,899 million (up 2.4% YOY), ordinary profit was JPY
26,104 million (up1.5% YOY), and quarterly net profit attributable to parent company shareholders was JPY
10,872 million (down 27.6% YOY).
Business results by segment (before inter-segment/company write-offs) are as follows.
From this consolidated cumulative 3rd quarter period, reporting segment categories have changed. The
following year-on-year comparisons are made after adjusting previous year figures in line with the new segmentcategories.
① Temporary Staffing/BPO Segment
Sales in this segment during this consolidated cumulative 3rd quarter period amounted to JPY 359,263
million (up 10.4% year-on-year (YOY)), and operating profit was JPY 16,908 million (up 9.6% YOY).
Employment related indicators during this consolidated cumulative 3rd quarter period continued to hover athigh levels; a continuation from the previous consolidated fiscal year, and chronic labor shortages wereaccompanied by ongoing robust demand. Also, various types of supply-side measures were successfully
implement to address pressing demand challenges. Sales grew substantially to JPY 359,263 million. On the
profit side, there was an increase in labor costs together with an expansion in operations, as well as anincrease in PERSOL Group's share of the burden of social insurance costs etc. for temps and employees.
However, there was a large increase in sales, and JPY 16,908 million in operating profit was booked.
② Recruiting Segment
Sales in this segment amounted to JPY 52,736 million (up 10.4% YOY) during this consolidated cumulative
3rd quarter period, and operating profit was JPY 6,890 million (up 2.9% YOY).
Sales grew significantly during this consolidated cumulative 3rd quarter period as a result of augmenting
human resources deployed in the sales structure to meet vigorous demand. On the profit side, operating profit
was JPY 6,890 million due to increased labor/promotional costs etc. that accompanied the expansion in－

4 －operations.
③

PROGRAMMED Segment
Operating loss in this segment during this consolidated cumulative 3rd quarter period was JPY 804 million.
Costs arose during this consolidated cumulative 3rd quarter period that were associated with the acquisitionof Programmed Maintenance Services Limited shares which led to an operating loss of JPY 804 million. The
closing day of the consolidated cumulative 3rd quarter period for the corporation subject to acquisition is
September 30; which differs from the closing day of the consolidated cumulative 3rd quarter period for
PERSOL Group by 3 months. Furthermore, September 30, 2017 has been deemed the corporate merger &acquisition date of acquisition and as such, the results of the corporation subject to acquisition have not been
included in this 3rd quarter.

④

PERSOLKELLY Segment
Sales in this segment during this consolidated cumulative 3rd quarter period were JPY 48,452 million (up124.2% YOY), and operating loss was JPY 314 million (operating loss in the same period last year was JPY
586 million).
Sales grew significantly during this consolidated cumulative 3rd quarter period as a result of expanded
operations accompanying an expansion in the scope of the joint venture with Kelly Services, Inc. On the profit
side, an operating loss of JPY 314 million was booked due to moving forward with establishing systems aimed
at medium-term growth, .

⑤ ITO Segment
Sales in this segment amounted to JPY 21,004 million (up 11.7% YOY) during this consolidated cumulative
3rd quarter period, and operating profit was JPY 1,335 million (up 6.9% YOY).
Sales grew steadily during this consolidated cumulative 3rd quarter period due to high levels of orders for
systems development related investments and SI related services from client firms, as well as PERSOL Groupin-house systems development transactions etc. On the profit side, the increase in costs associated withretention of engineers, moves to improve the treatment of new hires, as well as expansion in HQ officespace/work environment improvements etc. resulted in operating profit of JPY 1,335 million.
⑥

Engineering Segment
Sales in this segment amounted to JPY 20,154 million (up 4.8% YOY) during this consolidated cumulative
3rd quarter period, and operating profit was JPY 1,451 million (up 3.9% YOY).
Sales grew steadily during this consolidated cumulative 3rd quarter period due to continued strong demand
for talent primarily centered on electronics and automotive industries etc. On the profit side, there were
unprofitable projects where one-off cost increases arose which resulted in operating profit of JPY 1,451 million.

－

5 －(As at December 31, 2017)※ Note 1: This Segment was newly established consequent to the acquisition of Programmed Maintenance Services Limited shares on
October 27, 2017.
※ Note 2: The name of the segment formerly known as the "Overseas" Segment has been changed to "PERSOLKELLY" Segment.

－

6 －(2) Explanation of financial position① Status of assets, liabilities, and net asset
During this consolidated cumulative 3rd quarter period, total assets increased by JPY 123,970 million
compared to the end of the end of the previous consolidated fiscal year consequent to the acquisition of
Programmed Maintenance Services Limited shares. There was also an increase of JPY 118,129 million in total
liabilities compared to the end of the end of the previous consolidated fiscal year due to loans arising to fund said
share acquisition.
Current assets increased by JPY 46,840 million, and fixed assets increased by JPY 77,129 million. The main
factors behind the increase in current assets were increases in: notes and accounts receivable (up by JPY
24,836 million), cash and deposits (up by JPY 9,755 million), and work in progress (up by JPY 9,681 million). The
main reasons for the increase in fixed assets were increases in: goodwill (up by JPY 42,448 million), andtrademark rights (up by JPY 7,017 million) etc.
Current liabilities increased by JPY 105,404 million, and non-current liabilities increased by JPY 12,724 million.
The main reasons for the increase in current liabilities were increases in: short-term loans payable (up by JPY
75,719 million), and accounts payable -other (up by JPY 20,213 million) etc. The main reasons of the increase in
non-current liabilities were increases in long-term accounts payable (up by JPY 6,190 million) and deferred tax
liabilities (up by JPY 4,669 million).
Net assets increased by JPY 5,840 million compared to the end of the previous consolidated accounting period.
The main cause was an increase in retained earnings of JPY 6,663 million due to payment of JPY 4,209 million
in surplus dividends and posting 10,872 million in quarterly net profit attributable to parent company shareholders
etc.
Fiscal year ending Mar 2018
Consolidated cumulative 3rd quarter period(FY End Mar 2017)

Return on Assets (ROA)

3.0%

7.6%

Return on equity (ROE)

7.6%

13.4%

Ratio of operating income to sales

5.2%

5.6%

Ratio of ordinary profit to sales

5.3%

5.8%

Current ratio

109.7%

188.0%

Fixed assets ratio

123.5%

74.1%

Equity ratio

37.2%

51.8%

Total assets

JPY 392,334 million

JPY 268,364 million

Equity capital

JPY 145,950 million

JPY 139,119 million

JPY 79,038 million

JPY 69,382 million

Cash & cash equivalents etc. at end of
period②

Business and financial challenges that must be dealt with
There were no significant changes in this consolidated cumulative 3rd quarter period to the challenges thatmust be dealt with by PERSOL Group.

(3) Explanation of future forecast information (consolidated results forecast etc.)
The full year FY March 2017 consolidated results forecast (made public on May 15, 2017) was revised inlight of the following results trends etc.
・Consequent to the inclusion of Programmed Maintenance Services Limited in the consolidation, an increasein net sales is anticipated from the 4th quarter period onwards.
・A goodwill impairment loss of JPY 5,577 million was booked as an extraordinary loss during the consolidated
cumulative 3rd quarter period.

－

7 －2. Quarterly consolidated financial statements & main explanatory notes(1) Quarterly consolidated balance sheet
Previous consolidated
accounting period(March 31, 2017)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade
Deferred tax assets
Work in process
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Tangible fixed assets
Buildings and structures, net
Tools, furniture and fixtures, net
Land
Other, net
Tangible fixed assets total
Intangible assets
Trademark rights
Goodwill
Other
Intangible assets total
Investments and other assets
Investment securities
Guarantee deposits
Deferred tax assets
Other
Allowance for doubtful accounts
Investments and other assets total
Non-current assets total
Total Assets－

8 －(Unit: JPY million)
This 3rd quarter consolidated
accounting period(December 31, 2017)

69,43983,260
4,597
677
7,885
-619
165,240

79,194
108,097
3,275
10,358
11,630-474
212,081

2,231
1,263
803
541
4,840

3,377
1,227
803
2,706
8,114

4,995
68,561
9,310
82,867

12,013110,010
21,239144,263

7,782
5,765
1,371
547
-51
15,415
103,123
268,364

12,186
6,004
1,330
8,378
-25
27,874
180,252
392,334

(Unit: JPY million)
This 3rd quarter consolidated
accounting period(31 Dec 2017)

Previous consolidated
accounting period(March 31, 2017)
Liabilities
Current liabilities
Accounts payable – trade
Short-term loans payable
Current portion of long-term loans payable
Accounts payable - other
Income taxes payable
Accrued consumption taxes
Provision for bonuses
Provision for Directors' bonuses
Provisions - other
Other
Total current liabilities
Non-current liabilities
Convertible bonds with subscription rights tosharesLong-term loans payable
Deferred tax liabilities
Net defined benefit liability
Long-term accounts payable-other
Provision for share benefits
Provision for Directors' share benefits
Provisions - other
Other
Non-current liabilities total
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on marketable securities
Foreign currency translation adjustment
Total accumulated other comprehensive
incomeNon-controlling interests
Total net assets
Total liabilities and net assets

－

9 －

1,490
413
4,640
47,627
8,315
9,619
9,063
173
－
6,569
87,913

1,683
76,133
4,640
67,8404,450
12,5385,232
2809
19,985
193,31731

27

20,426
2,793
1,093
2,197
－
－
－
92
26,634
114,547

26,616
7,463
1,142
2,333
96
73
296
1,309
39,358
232,676

17,465
20,156
102,432-3,328
136,725

17,467
20,182109,096-4,577142,168

2,203
190

2,927
854

2,394

3,781

14,696
153,816
268,364

13,707
159,657
392,334

(2) Quarterly consolidated profit and loss statement & quarterly consolidated comprehensive income statement(Quarterly consolidated profit and loss statement)(Consolidated cumulative 3rd quarter period)……………………………………………………………………………………

Net sales
Cost of sales
Gross profit on sales
Selling, general and administrative expenses (SGA)
Operating profit
Non-operating income
Interest income
Dividends income
Subsidy income
Compensation income
Share of profit of entities accounted for using
equity method
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of subsidiaries and affiliates’ stocks
Gain on revision of retirement benefit plan
Gain on sales of investment securities
Gain on sales of fixed assets
Extraordinary income total
Extraordinary losses
Impairment loss
Loss on valuation of investment securities
Loss on revision of retirement benefit plan
Early extra retirement payments
Loss on disposal of non-current assets
Total extraordinary losses
Net quarterly profit before taxes etc.
Corporate tax, resident tax, and business tax
Corporate tax etc.-deferred
Total corporate taxes etc.
Quarterly net profit
Quarterly net profit attributable to non-controllinginterests
Quarterly net profit attributable to parent company
shareholders(Unit: JPY million)
Previous consolidated
This consolidated cumulative
cumulative 3rd quarter period
3rd quarter period(From April 1, 2016
(From April 1, 2017
to Dec 31, 2016)
to Dec 31, 2017)429,560
495,085
324,764
376,761
104,795
118,323
79,50792,42425,28725,899

－

10 －

8
78
175
60

22
111
503
－

69

56

196
589

103
796

117
8
42
168
25,708

111
444
34
591
26,104

－
187
－
0
187

2
－
65
0
68

422
－
－
207
0
629
25,266
8,695
570
9,265
16,000

5,584
28
261
17
－
5,891
20,2819,001
1,382
10,384
9,896

975

-975

15,024

10,872

(Quarterly consolidated comprehensive income statement)(Consolidated cumulative 3rd quarter period)……………………………………………………………………………………

Quarterly net profit
Other comprehensive income
Valuation difference on marketable securities
Foreign currency translation adjustment
Retirement benefit adjustment funds
Total other comprehensive income
Quarterly comprehensive income(Breakdown)
Quarterly comprehensive income attributable toparent company shareholders
Quarterly comprehensive income attributable tonon-controlling interests(Unit: JPY million)
Previous consolidated
This consolidated cumulative
cumulative 3rd quarter period
3rd quarter period(From April 1, 2016
(From April 1, 2017
to Dec 31, 2016)
to Dec 31, 2017)
16,000
9,896

－

11 －

572
-1,766194-1,00014,999

723
783
1,506
11,403

14,31812,268681-864

(3) Explanatory notes regarding quarterly consolidated financial statements(Explanatory notes regarding ongoing concern assumptions)No applicable matters.
(Explanatory notes in the event there are significant changes in the amount of shareholders’ equity)
No applicable matters.
(Application of special accounting treatment when preparing the quarterly consolidated financial statements)
No applicable matters.

－

12 －

(Segment information etc.)
1. Information regarding sales, profits or losses for each reporting segment
Previous consolidated cumulative 3rd quarter period (from April 1, 2016 to December 31, 2016)(Unit: JPY million)
Reporting segment

Temporary

PROGR-PERSOL

Recruiting
Staffing/BPO

Quarterly

ITO
AMMED

Engineering

KELLY

Total
amountOther
Note: 1.

Total

Adjustment

consolidated

amountprofit and loss

Note: 2statement

Note: 3

Sales
Sales toexternal

324,164 47,384- 21,609

14,096 19,221 426,476

3,020 429,497

-

4,714

1,975

62 429,560

clients
Internal sales
or transfers
between

1,219

399

3

11

6,349

8,324

-8,324－

segments
Total amount

325,384 47,783- 21,612

15,422-

18,811 19,233 432,825

4,996 437,821-8,261 429,560

Segment
profits or

6,697

-586

1,249

1,397

24,179271

24,451836

25,287

losses (-)

This consolidated cumulative 3rd quarter period (from April 1, 2017 to December 31, 2017)(Unit: JPY million)
Reporting segment

Temporary

PROGR-PERSOL

Recruiting
Staffing/BPO

Quarterly

ITO
AMMED

Engineering

KELLY

Total
amountOther
Notes: 1.

Total

Adjustment consolidated
amount profit and loss
Notes: 2.
statement
Notes: 3.

Sales
Sales toexternal

357,685 52,081-

48,405 15,528 20,148 493,848

1,235 495,084

0 495,085

clients
Internal sales
or transfers
between

1,577

655

-

359,263 52,736

-

47

5,476

6

7,762

1,887

9,649

-9,649-segments
Total amount
Segment profits
or losses (-)

16,908

6,890

-804

48,452 21,004 20,154 501,611
-314

1,335

1,451

25,466

3,123 504,734-139

25,327-9,648 495,085
572

25,899Notes: 1. The "Other" category refers to business segments that are not included in reporting segments that include HR services which
fulfill Group-wide functions such as: shared-services, education and training etc.
2. Details of these revisions are as follows.

－

13 －

(Unit: JPY million)
Previous consolidated
This consolidated cumulative
cumulative 3rd quarter period
3rd quarter period
-44

-214

Company-wide revenues ※1

4,010

5,977

Company-wide expenses ※2-3,129-5,190

Total

836

572

Inter-segment write-offs※1. Company-wide revenues: mainly business management fees from Group companies, and dividends received.
※2. Company-wide expenses: mainly expenses arising in PHD related to management of Group companies.

3. Segment profit and loss: Adjusted with operating profit calculated in the quarterly consolidated profit and loss
statement.

2. Information relating to assets of each reporting segment
Previous consolidated cumulative 3rd quarter period (from April 1, 2016 to December 31, 2016)nd

During the consolidated cumulative 2 quarter period, a new acquisition of Kelly Services (Singapore)
Pte. Ltd. shares took place, and its subsidiaries are included in the scope of consolidation. Accordingly,
compared with the end of the previous consolidated accounting period, the amount of assets in reporting
segments during this consolidated cumulative 3rd quarter period increased by JPY 13,988 million in the
PERSOLKELLY Segment.
This consolidated cumulative 3rd quarter period (from April 1, 2017 to December 31, 2017)
During this consolidated cumulative 3rd quarter period, a new acquisition of Programmed Maintenance
Services Limited shares took place, and its subsidiaries have been included in the scope of consolidation.
Accordingly, compared with the end of the previous consolidated accounting period, the amount of assets
in reporting segments during this consolidated cumulative 3rd quarter period increased by JPY 128,392
million in the PROGRAMMED Segment.
3. Matters relating to reporting segment changes etc.
From the fiscal year ending Mar 2016 PERSOL Group began operating with 4 reporting segments:
Temporary Staffing/BPO, ITO, Engineering, and Recruiting. The aim was to: strengthen strategy design
capabilities, promote strategy, clarify responsibilities in response to a rapidly changing market, and toachieve nimble management decision making.
Greater importance of the Overseas Segment was acknowledged, and from the fiscal year ending
March 2018 the Overseas Segment (previously included in the Recruiting Segment) was established as aseparate “Overseas” Segment. A transition will be made to a system comprised of five reporting segments(Temporary Staffing/BPO, Recruiting, Overseas, ITO, and Engineering) to improve future management
lines of reporting.
During this consolidated cumulative 3rd quarter period, a new acquisition of Programmed Maintenance
Services Limited shares took place, and its subsidiaries have been included in the scope of consolidation.
Accordingly, companies in the ambit of the Programmed Ltd group of companies will form the newly
created "PROGRAMMED" Segment, and the segment demarcation formerly known as the "Overseas"
Segment will undergo a name change and become the "PERSOLKELLY" Segment. This transition will bemanifested into 6 reporting segments: Temporary Staffing/BPO, Recruiting, PROGRAMMED,PERSOLKELLY, ITO, and Engineering.
Moreover, segment information relating to the previous consolidated cumulative 3rd quarter period has
been released after being created in accordance with reporting segment classifications applied during thisconsolidated cumulative 3rd quarter period.
4. Information concerning impairment losses of non-current assets or goodwill etc. in each reporting segment(Significant impairment losses relating to non-current assets)
Previous consolidated cumulative 3rd quarter period (from April 1, 2016 to December 31, 2016)
At the PERSOL Management Committee meeting held on September 2, 2016, a resolution was passed－

14 －for an absorption-type company split to take place on January 1, 2017 with consolidated subsidiary
Tempstaff Technology Co., Ltd. in respect to the engineer temporary staffing business of consolidated
subsidiary Intelligence, Co., Ltd. To maximize future business synergies, trademarks applied to theengineer temporary staffing sector will be reduced in price because the "Intelligence" trademark will nolonger be used in PERSOL’s engineer temporary staffing sector. As a result of this event, an impairment
loss of JPY 280 million was booked in relation to the Temporary Staffing/BPO Segment.
Furthermore, consolidated subsidiary Medicross Co., Ltd. goodwill was booked at the time the shareswere acquired however, due to decline in profitability, the book value has been reduced to a recoverable
amount. As a result of this event, an impairment loss of JPY 141 million was booked in relation to the
Temporary Staffing/BPO Segment.
This consolidated cumulative 3rd quarter period (from April 1, 2017 to December 31, 2017)
Goodwill was calculated at the time when shares were acquired in consolidated subsidiaries Capita Pte.
Ltd., First Alliances Co., Ltd., Kelly Services (Singapore) Pte. Ltd., and Kelly Services (India) Pvt. Ltd.
However, due to a decline in profitability the value has diminished to a point where book value is therecoverable amount. As a result of these circumstances, an impairment loss of JPY 5,577 million wasbooked in relation to the PERSOLKELLY Segment.
(Important changes to goodwill amounts)
Previous consolidated cumulative 3rd quarter period (from April 1, 2016 to December 31, 2016)
Goodwill amortization in the PERSOLKELLY Segment increased by JPY 4,361 million as a result of theacquisition of shares in Kelly Services (Singapore) Pte. Ltd. on July 4, 2016 and making it a newconsolidated subsidiary.
This consolidated cumulative 3rd quarter period (from April 1, 2017 to December 31, 2017)
Goodwill in the PROGRAMMED Segment increased by JPY 52,583 million as a result of the acquisitionof shares in Programmed Maintenance Services Limited on October 27, 2017 and making it a newconsolidated subsidiary.
(Corporate Mergers & Acquisitions Related)
This consolidated cumulative 3rd quarter period (from April 1, 2017 to December 31, 2017)(Corporate mergers by acquisition)
Acquisition of Programmed Maintenance Services Limited
1. Overview of the corporate merger & acquisition(1)

Name & business outline of the corporation subject to acquisition
Name of the corporation subject to acquisition: Programmed Maintenance Services Limited (hereinafter"Programmed Ltd.")
Business outline: Placement/recruitment, temporary staffing, equipment/facilities maintenance(2)

Main reasons for the corporate merger & acquisition
PHD's overseas business interests: In 2010 a strategic business alliance agreement was signed with
Kelly Services Inc. (a major US-based HR services company), and in 2012, both firms launched a joint
venture in North Asia. In addition, in 2016, the joint venture was expanded to cover the entire Asia Pacificregion and currently focuses on temporary staffing, placement, and HR management consulting. The JV iscurrently developing business in 12 countries and regions: PRC, Hong Kong, South Korea, Taiwan,
Singapore, Vietnam, Indonesia, Malaysia, Thailand, India, New Zealand, and Australia.
On the other hand, Programmed Ltd. was established as a painting services company in 1951, and after
mergers with a major Australian HR services company etc., is presently a leading HR services andmaintenance company. Programmed Ltd. focuses on the HR services sector (temporary staffing andplacement), and facilities management (commercial facilities/schools), painting, land development, andmine facility maintenance. Programmed Ltd. had consolidated sales of AUD 2,691 million andconsolidated EBITDA of AUD 96 million in the fiscal year ended March 2017.
PERSOL decided to pursue this share acquisition seeking to further expand its business in future by
combining the strong business foundations of both companies - the know-how and customer base－

15 －cultivated in the Asia Pacific region by PERSOL together with the scale/results of Programmed Ltd. inAustralia etc.
(3)

Corporate merger & acquisition date
October 27, 2017(4) Legal form of the corporate merger & acquisition, and corporate name post-acquisition
Legal form of the corporate merger & acquisition: Shares acquired for cash consideration.
Corporate name post-acquisition: There will be no change to the corporate name after the corporate
merger & acquisition takes place.
(5)

Ratio of voting rights acquired
100%

(6)

Main basis for deciding to acquire the corporation
The acquisition of shares was effected by PERSOL HOLDINGS paying cash consideration via an
Australian subsidiary company.

2. Period of results for the corporation subject to acquisition included in the quarterly consolidated profit and loss
statement pertaining to the quarterly consolidated cumulative period
The closing day of the consolidated cumulative 3rd quarter period for the corporation subject toacquisition is September 30; which differs from the closing day of the consolidated cumulative 3rd quarter
period for PERSOL Group by 3 months. Furthermore, September 30, 2017 has been deemed thecorporate merger & acquisition date of acquisition and as such, the results of the corporation subject toacquisition have not been included in this 3rd quarter.
3. Itemized cost price of the corporation subject to acquisition, and kind of consideration
Cost price of the acquisition
Cash
JPY 66,075 million
Acquisition cost priceJPY 66,075 million

4. Moneys occurring in relation to goodwill, causes for the occurrence, amortization method, and amortization
period.
(1) Monetary amounts of goodwill that occurred
JPY 52,583 million
In addition, distribution of the acquisition cost price was not completed as at the end of this consolidated
cumulative 3rd quarter period, so the monetary amount of goodwill as such, is a provisionally calculated
amount.
(2) Causes of this occurrence
The main causes were that it was judged that there was potential for mutual utilization of infrastructure,brand-power, owned by PERSOL Group and the corporation subject to acquisition, and potential for
generation of beneficial business synergies and the anticipation of excess earnings.
(3) Amortization method & amortization period
Goodwill will be uniformly amortized over 10 years and 20 years.

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