May 12, 2017

Summary of Consolidated Financial Results for the Fiscal Year Ended March 31, 2017
[Japanese GAAP]
Listing: Tokyo Stock Exchange, Second Section
URL: http://www.iwakipumps.jp/

Company name: IWAKI CO.,LTD.
Stock code:
6237
Representative:
Shigeru Fujinaka, President
Contact:
Kenji Matsuda, Senior Executive Director
Scheduled date of Annual General Meeting of Shareholders:
Scheduled date of payment of dividend:
Scheduled date of filing of Annual Securities Report:
Preparation of supplementary materials for financial results:
Holding of financial results meeting:Tel: (81)3-3254-2931
June 29, 2017
June 30, 2017
June 30, 2017
Yes
Yes (for institutional investors and analysts)(All amounts are rounded down to the nearest million yen)

1. Consolidated Financial Results for the Fiscal Year Ended March 31, 2017 (April 1, 2016 – March 31, 2017)(1) Consolidated results of operations
Net sales
Million yen
Fiscal year ended Mar. 31, 201725,146
Fiscal year ended Mar. 31, 2016
24,830Note: Comprehensive income (million yen):
Net income per
share(Percentages represent year-on-year changes)
Profit attributable toOperating profit
Ordinary profit
owners of parent% Million yen% Million yen% Million yen
%
1.3
1,465
(4.4)
2,136
7.3
1,690
10.7
8.9
1,533
54.8
1,991
32.2
1,527
48.3
Fiscal year ended Mar. 31, 2017:
1,488 (up 161.8%)
Fiscal year ended Mar. 31, 2016:
568 (down 69.0%)
Diluted net
Return on equity
income per share

Yen

Yen

Fiscal year ended Mar. 31, 2017
225.93Fiscal year ended Mar. 31, 2016
223.99Reference: Equity in earnings of affiliates (million yen):
2016: 410
(2) Consolidated financial position

Operating profit
to net sales

%

%

%

10.3
8.3
5.8
10.0
7.9
6.1
Fiscal year ended Mar. 31, 2017: 488 Fiscal year ended Mar. 31,

Total assets

Capital adequacy
ratio

Net assets

Million yen
Million yen
26,253
16,90625,43816,075
As of Mar. 31, 2017: 16,718

As of Mar. 31, 2017
As of Mar. 31, 2016
Reference: Owner’s equity (million yen)

Ordinary profit
on total assets

Net assets per share

%
Yen
63.7
2,233.84
63.0
2,144.27
As of Mar. 31, 2016: 16,048(3) Consolidated cash flows
Cash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities

Cash and cash
equivalents at end of
periodMillion yen

Million yen

Million yen

Million yen

2,001
1,413

(150)
997

(1,151)
(935)

6,111
5,426

Fiscal year ended Mar. 31, 2017
Fiscal year ended Mar. 31, 2016

2. Dividends
Dividend per share
1Q-endFiscal year ended Mar. 31, 2016
Fiscal year ended Mar. 31, 2017
Fiscal year ending Mar. 31, 2018
(forecast)Year-end

Total

Total
dividends

Dividend
Dividend on
payout ratio
equity(consolidated) (consolidated)

2Q-end3Q-end

Yen

Yen

Yen

Yen

Yen

Million yen

%

%

-

0.00
30.00

-

78.80
38.00

78.80
68.00

589
508

35.1
30.1

3.7
3.1

-

26.00

-

33.00

59.00

30.4

3. Consolidated Earnings Forecasts for the Fiscal Year Ending March 31, 2018 (April 1, 2017 – March 31, 2018)
Net salesFirst half
Full year

Million yen
13,07526,517

Operating profit
%
5.5
5.5

Million yen
767
1,672

%
(0.5)
14.1

(Percentages represent year-on-year changes)
Profit attributable to
Net income per
Ordinary profit
owners of parent
shareMillion yen%
Million yen%
Yen
923 (15.0)
647 (17.0)
86.45
1,969
(7.8)
1,450 (14.2)
193.82

* Notes(1) Changes in consolidated subsidiaries during the period (changes in scope of consolidation): None
(2) Changes in accounting policies and accounting-based estimates, and restatements
1) Changes in accounting policies due to revisions in accounting standards, others: Yes
2) Changes in accounting policies other than 1) above:None3) Changes in accounting-based estimates:

None4) Restatements:
None
Note: Please refer to “5. Consolidated Financial Statements and Notes, (5) Notes to Consolidated Financial Statements,
Changes in Accounting Policies” on page 15 of the attachments for further information.

(3) Number of outstanding shares (common shares)
1) Number of shares outstanding at the end of the period (including treasury shares)
As of Mar. 31, 2017:

7,484,370 shares

As of Mar. 31, 2016:

7,484,370 shares

As of Mar. 31, 2016:- shares

2) Number of treasury shares at the end of the period
As of Mar. 31, 2017:18 shares

3) Average number of shares outstanding during the period
Fiscal year ended Mar. 31, 2017:

7,484,357 sharesFiscal year ended Mar. 31, 2016:

6,819,697 shares

Reference: Summary of Non-consolidated Financial Results
Non-consolidated Financial Results for the Fiscal Year Ended March 31, 2017 (April 1, 2016 – March 31, 2017)(1) Non-consolidated results of operations(Percentages represent year-on-year changes)

Fiscal year ended Mar. 31, 2017
Fiscal year ended Mar. 31, 2016

Fiscal year ended Mar. 31, 2017
Fiscal year ended Mar. 31, 2016

Net sales
Million yen
20,76820,598%0.8
7.8

Net income per shareYen
172.35165.74

Operating profit
Million yen%
873 (17.3)
1,055
60.0

Ordinary profit
Million yen
%
1,597
4.9
1,522
35.7

ProfitMillion yen
1,289
1,130

%
14.1
26.6

Diluted net income per share
Yen-(2) Non-consolidated financial position
Total assets
Net assets
Equity ratio
Net assets per share
Million yen
Million yen%
Yen
As of Mar. 31, 2017
22,918
14,544
63.5
1,943.34
As of Mar. 31, 2016
22,46814,18963.1
1,895.83
Reference: Shareholders’ equity (million yen):
As of Mar. 31, 2017: 14,544
As of Mar. 31, 2016: 14,189* The current financial report is not subject to audit procedures.
* Cautionary statement with respect to forward-looking statements
1. Forecasts of future performance in these materials are based on assumption judged to be valid and information available to
the Company’s management at the time the materials were prepared, but are not promises by the Company regarding future
performance. Actual results may differ materially from the forecasts. Please refer to “1. Overview of Results of Operations,(1) Results of Operations, 2) Outlook” on page 2 for forecast assumptions and notes of caution for usage.
2. The Company plans to hold a financial results meeting for institutional investors and analysts on May 26, 2017. Materials to
be distributed at this event will be available on the Company’s website immediately thereafter.

IWAKI CO.,LTD. (6237) Financial Results for FY3/17

Contents of Attachments
1. Overview of Results of Operations

2(1) Results of Operations

2(2) Financial Position3

2. Corporate Group4

3. Management Policies

6(1) Basic Management Policy

6(2) Performance Targets

6(3) Medium- and Long-term Business Strategy

6(4) Challenges

6

4. Basic Approach to the Selection of Accounting Standards

7

5. Consolidated Financial Statements and Notes

8(1) Consolidated Balance Sheet

8(2) Consolidated Statements of Income and Comprehensive Income

10

Consolidated Statement of Income

10

Consolidated Statement of Comprehensive Income11(3) Consolidated Statement of Changes in Equity

12(4) Consolidated Statement of Cash Flows

14(5) Notes to Consolidated Financial Statements

15

Going Concern Assumption

15

Changes in Accounting Policies

15

Reclassifications

15

Additional Information

15

Business Combinations

15

Segment and Other Information

17

Per Share Information

18

Subsequent Events18

6. Others

18

Changes in Directors

18

1

IWAKI CO.,LTD. (6237) Financial Results for FY3/17

1. Overview of Results of Operations(1) Results of Operations
1) Operating results for the current fiscal year
In Japan, the recovery in corporate earnings and improvements in jobs and personal income continued. But there
are concerns about slowing economic growth in China and emerging countries and increasing worries about
political risk in Europe and the United States. Due to this uncertainty about overseas economies, the economic
outlook remained unclear.
In the domestic sales head office, there were extensive workplace sales activities based on the core policy of“competing and winning” in order to build stronger relationships with customers. In Iwaki’s six major markets, adecline in large projects reduced new energy sales and sales were soft in the semiconductor/liquid crystal market
and the chemicals market. In the medical equipment market, sales were higher, chiefly for products sold to themain customers of this market sector. Sales increased in the water treatment market. One reason was theacquisition at the end of 2016 of TechnoECHO Co., Ltd., a company that designs, manufactures and sells residual
chlorine meters. As a result, sales in Japan increased 1.8% to 15,951 million yen.
Iwaki America Inc. posted strong sales in the medical equipment market, but performance was sluggish in the
new energy market and the chemicals market. Although this company’s sales in the core water treatment market
increased, the yen’s appreciation in the first half of the current fiscal year lowered yen translations of sales. As aresult, U.S. sales decreased 4.0% to 4,254 million yen. At Iwaki Europe GmbH in Germany, sales were higher inthe semiconductor/liquid crystal market, but decreased in the surface treatment equipment market and thechemicals market. In addition, the yen’s strength had a negative impact, resulting in a 4.1% decrease in sales to
1,919 million yen. Sales of Iwaki Singapore Pte Ltd. were strong in its core semiconductor/liquid crystal market
and water treatment market. However, sales decreased 1.8% to 237 million yen affected by the yen’s appreciation.
Sales of IWAKIm SDN. BHD. in Malaysia benefited from large orders in its core semiconductor/liquid crystal
market, and performance was good in the surface treatment equipment market. Although the yen’s strength had anegative impact, sales increased 0.4% to 102 million yen. In other regions, Iwaki worked with partner companies
on measures to increase sales. Overall, sales in China were firm in the surface treatment equipment market but
slow in the water treatment market. In Korea and Taiwan, there were strong sales in the semiconductor/liquid
crystal market and the surface treatment equipment market. As a result, sales to overseas customers other than
Iwaki subsidiaries increased 12.4% to 2,681 million yen.
Consequently, consolidated sales increased 1.3% to 25,146 million yen.
Earnings benefited from the growth in sales, but there were higher expenses for R&D activities, substantial
capital expenditures for molds and other equipment, and an increase in personnel expenses, mostly at overseas
subsidiaries, for recruiting people needed for growth in the future. The result was a 4.4% decrease in operating
profit to 1,465 million yen. However, ordinary profit increased 7.3% to 2,136 million yen and profit attributableto owners of parent increased 10.7% to 1,690 million yen. The main reasons were higher share of profit ofequity-method affiliates in Asian markets and foreign exchange gains on investment securities that matured
during the current fiscal year.
2) Outlook
In the fiscal year ending on March 31, 2018, the global economic outlook is expected to remain unclear. There areuncertainties about policies of the Trump administration in the United States, the effects of Britain’s departurefrom the EU, and the economic health of China and emerging countries in Asia. In Japan, corporate capital
expenditures continue to recover slowly in part because of investments in labor-saving equipment in response to
Japan’s labor shortage. In addition, consumer spending is firm. However, the outlook for the Japanese economy
will probably remain unclear due to geopolitical risk in Asia and other reasons.

2

IWAKI CO.,LTD. (6237) Financial Results for FY3/17

Looking at recent conditions of our core markets, in the medical equipment market, we foresee strong sales of
products for immunoassay analyzers in China and for dialysis equipment and biochemical analyzers in Japan. In
the semiconductor/liquid crystal market, we anticipate investments to remain strong in Asia but expect market
conditions to become uncertain in the second half of the fiscal year. In the water treatment market, we expect
demand to remain solid for products used for circulation, sterilization, liquid medicine supply and ballast water
applications. Furthermore, we anticipate demand involving hot bathing facilities resulting from synergies with theresidual chlorine meter business of TechnoECHO Co., Ltd. In the chemicals market, we expect growth in demand
involving the development of high value-added products and from increasing investments by pharmaceuticalcompanies.
The Iwaki Group’s operations in Japan will continue to introduce products that meet the needs of customers while
conducting activities based on the core policy of “competing and winning.” Overseas, there will be even closer
ties with affiliated companies with goal of increasing sales and earnings by strengthening marketing and sales
activities.
Based on outlook for our markets and plans for business activities stated above, we forecast a 5.5% increase inconsolidated sales to 26,517 million yen in the fiscal year ending on March 31, 2018.
For earnings, we forecast a 14.1% increase in operating profit to 1,672 million yen. We do not anticipate a foreignexchange gain resulting from the redemption of investment securities, which contributed to earnings in thecurrent fiscal year, and are using a conservative outlook for share of profit of equity-method affiliates. The result
is forecasts of 1,969 million yen for ordinary profit, down 7.8%, and 1,450 million yen for profit attributable toowners of parent, down 14.2%.
These projections are based on information available at the time of release of this report. Actual results may differ
from projections due to a variety of factors.
(2) Financial Position
1) Assets, liabilities and net assets
AssetsThe balance of current assets at the end of the current fiscal year was 19,832 million yen, up 143 million yen fromthe end of the previous fiscal year. This was mainly due to increases of 967 million yen in electronically recordedmonetary claims-operating, 464 million yen in cash and deposits, and 148 million yen in raw materials andsupplies, while there were decreases of 955 million yen in notes and accounts receivable-trade, and 462 million
yen in securities. The balance of non-current assets was 6,421 million yen at the end of the current fiscal year, up
672 million yen from the end of the previous fiscal year. This was mainly because of a 909 million yen increase inconstruction in progress, while there was a 221 million yen decrease in investment securities.
As a result, total assets increased 815 million yen from the end of the previous fiscal year to 26,253 million yen.
Liabilities
The balance of current liabilities at the end of the current fiscal year was 7,031 million yen, down 88 million yen
from the end of the previous fiscal year. This was mainly due to a 257 million yen decrease in short-term loans
payable, while there was a 100 million yen increase in provision for directors’ bonuses. The balance of
non-current liabilities was 2,315 million yen at the end of the current fiscal year, up 72 million yen from the endof the previous fiscal year. This was mainly due to a 151 million yen increase in provision for directors’
retirement benefits while there was a 72 million yen decrease in net defined benefit liability.
As a result, total liabilities decreased 15 million yen from the end of the previous fiscal year to 9,347 million yen.

3

IWAKI CO.,LTD. (6237) Financial Results for FY3/17

Net assets
The balance of net assets was 16,906 million yen at the end of the current fiscal year, up 830 million yen from theend of the previous fiscal year. The main factors include an 876 million yen increase in retained earnings.
Consequently, the capital adequacy ratio was 63.7% (63.0% at the end of the previous fiscal year).
2) Cash flows
Cash and cash equivalents (hereinafter, “net cash”) at the end of the current fiscal year was 6,111 million yen, up
685 million yen over the end of the previous fiscal year (an increase of 1,393 million yen at the end of theprevious fiscal year).
The cash flow components during the current fiscal year and the main reasons for changes are as described below.
Cash flows from operating activities
Net cash provided by operating activities was 2,001 million yen (1,413 million yen provided in the previous fiscal
year). Positive factors include profit before income taxes of 2,146 million yen, which offset negative factors
including share of profit of entities accounted for using equity method of 488 million yen.
Cash flows from investing activities
Net cash used in investing activities was 150 million yen (997 million yen provided in the previous fiscal year).
Negative factors include purchase of property, plant and equipment of 1,219 million yen, which offset positive
factors including proceeds from redemption of securities of 555 million yen and proceeds from withdrawal oftime deposits of 300 million yen.
Cash flows from financing activities
Net cash used in financing activities was 1,151 million yen (935 million yen used in the previous fiscal year). The
main factors include cash dividends paid of 813 million yen and a net decrease in short-term loans payable of 232
million yen.
2. Corporate GroupThe Iwaki Group consists of IWAKI CO.,LTD., its eight subsidiaries and 14 affiliates. The primary activities of
the Group are the manufacture and sale of magnetic drive pumps, metering pumps, pneumatic drive pumps, rotary
displacement pumps, air pumps and system products. Categorized by customers’ industry and application, theprimary markets for these products are the semiconductor/liquid crystal market, medical equipment market,
surface treatment equipment market, water treatment market, chemicals market, new energy market and others.
[Organizational chart]
An organizational chart of the Iwaki Group is as follows.

4

IWAKI CO.,LTD. (6237) Financial Results for FY3/17

Domestic customers

TechnoECHO Co., Ltd.

EuropeAssembly/sales

Iwaki Europe GmbH

Sales
*1

IWAKI Nordic A/S

North/Latin America
Manufacture/assembly/sales

Iwaki America Inc.

Sales

Sales

China
Management/procurement*3

IWP Holding
Company Limited*3
IWP Trading(Shenzhen) Co., Ltd.

Scheduled*1
Iwaki Europe GmbHIWAKI Korea Co., Ltd.
Iwaki Singapore Pte Ltd. *1 IWAKI (Thailand) Co., Ltd.
*1
IWAKIm SDN. BHD.
IWAKI Pumps Australia Pty*1
IWAKI Nordic A/SLtd.
*1IWAKI Pumps Co., Ltd.
Scheduled*1
IWAKI Pumps (Shanghai) Co., Ltd.

Overseas customers

IWAKI CO.,LTD.

IWAKI Do Brasil Comercio
De Bombas Hidraulicas
LTDA.

Sales
*1

Assembly*2

Iwaki Pumps(Guangdong) Co,Ltd.

IWAKI Pumps Co.,
Ltd.

Sales
*2

Sales
*1

GFTZ IWAKI
Engineering &Trading Co., Ltd.

IWAKI Pumps(Shanghai) Co.,Ltd.

Asia and others
Sales

Iwaki Singapore Pte Ltd.
IWAKIm SDN. BHD.
*1
IWAKI Korea Co., Ltd.
*1
IWAKI (Thailand) Co., Ltd.
Assembly/sales*1*1

IWAKI Pumps Taiwan Co., Ltd.
IWAKI Pumps Australia Pty Ltd.

(Notes)IWAKI materials, finished goods and merchandise
Subsidiary materials, finished goods and merchandise

No mark: Consolidated subsidiaries*1: Affiliates accounted for using equity method*2: Subsidiaries of IWAKI Pumps Co., Ltd.
*3: Non-consolidated equity-method subsidiaries established during the fiscal yearthat ended on March 31, 2017 that is currently preparing to start operations.

5

IWAKI CO.,LTD. (6237) Financial Results for FY3/17

3. Management Policies(1) Basic Management Policy
The Iwaki Group is guided by the management philosophy of “always supporting industrial activity at the leadingedge of progress and contributing to social advancement and happiness.” Growth in sales and earnings is not our
only objective. We want to be an organization that uses chemical pumps and associated technologies to earn thetrust of companies in many industries. We do much more than supply chemical pumps. We are also dedicated tousing these pumps to provide functions involving the movement of liquid medicine. Based on the belief that all
employees are points of contact with customers, we have programs to upgrade the skills and commitment of
everyone at the Group. Our goal is sustained growth in sales and earnings backed by four basic policies:
improving the quality of our organization, enhancing skills needed to serve customers, building a stable profit
structure and maintaining a sound compliance system.
(2) Performance Targets
The Iwaki Group places priority on sales, the operating margin and the return on equity based on net income. The
goal is to grow consistently while maintaining a well-balanced financial position.
(3) Medium- and Long-term Business Strategy
Chemical pumps, which are the main product of the Iwaki Group, are a mature product category. This makes it
difficult to develop innovative products that incorporate revolutionary technologies. As a global manufacturer ofthese pumps, the Iwaki Group is constantly concentrating on developing new advanced products ahead ofcompetitors. While new products are important, we believe that the most important reason customers worldwide
choose our products is our ability to use our experience, new technologies and other knowledge to meet a broad
spectrum of customers’ demands with speed and accuracy.
Customers can rely on us for hardware support extending from ideas for new systems to the creation of unitized
products and the fabrication of customized pumps of all types. We also have strengths involving aspects ofoperations other than hardware, such as delivery times, cost, and services. These skills enable us to meet all therequirements of our customers. In addition, we are aware of the importance of constantly upgrading our ability toserve our customers. This is why we have many activities for keeping the entire group focused on the theme ofoperating as a “solution company” that can earn the trust of customers in all our markets around the world.
We are positioning the medical equipment market, water treatment market and new energy market as the strategic
markets of the Iwaki Group. All three markets are growing and have a relatively low vulnerability to changes in
economic conditions. We are targeting these markets by combining our group’s expertise in precisely meetingcustomers’ needs, using advanced technologies, performing effective sales activities and other fields. We believethat meeting the diverse needs of customers in Japan as well as in Europe, the United States, Asia and other key
regions will enable us to achieve sustained growth.
(4) Challenges
The Iwaki Group currently has the following major challenges.
1) Reinforce ability to develop products and technologies
To succeed in Japan and overseas as competition becomes increasingly heated, we must develop products withgreater speed and even more advanced technologies. We are building the necessary infrastructure for basic
research and core technology development by assembling an R&D framework with few restrictions, conducting
joint research projects with companies and public-sector and academic-sector partners, and using other measures.
The goal is to develop distinctive products that no competitor can match. We are also building a process for the

6

IWAKI CO.,LTD. (6237) Financial Results for FY3/17

timely development of products that accurately reflect market conditions and our customers’ requirements. We
plan to develop products even faster while maintaining the current high level of quality.
2) Strengthen and enlarge the solution businessIn addition to reinforcing product development skills, accurately identifying the changing needs of customers andquickly responding to those needs are vital to our operations. To accomplish this, we will enhance and increase
the use of consulting capabilities for the purpose of taking full advantage of the functions of high value-added
unitized products. Meeting customers’ demands for advanced fluid control is another theme. We will actively
create proposals for systems covering many applications by using simulation assessment tests with actual fluids.
Furthermore, we will make more improvements to our before and after maintenance services so that customers
can use our products with confidence for many years. The aim is increasing the Iwaki brand’s reputation for
reliability. By further strengthening and enlarging the solutions business, we plan to differentiate ourselves fromcompetitors and earn the trust of customers worldwide as the “solution company.”3) Expand overseas operations
Manufacturers in Japan continue to move operations to other countries. That means we must work even harder ontargeting overseas demand in order to capture more orders outside Japan. One way we plan to do this is byincreasing overseas procurement and manufacturing activities in a manner that reflects the characteristics of ourlineup consisting of more than 60 series of products. In another move to expand our overseas operations, we willassemble an even stronger IT infrastructure that can facilitate more cooperation among group companies.
Marketing activities that match the distinctive nature of each region based will also be essential for growthoverseas. For some time now, we have been deepening ties between Japan and our overseas operations. In Europe,
we have been using marketing managers who have extensive knowledge of key overseas regions. Using thesemanagers has enabled us to identify the diversifying needs of customers with even greater accuracy. Now we plan
to appoint marketing managers for other major overseas markets and take other steps to strengthen departments
associated with these marketing activities.
4) Build an effective training system
We believe that the Iwaki Group must have an organizational structure and employee training program that canadapt to changes in our operating environment. We will return to the basic stance that “a company is only as goodas its people” in order to reexamine all our human resource systems. We want to become a truly globalorganization able to sell IWAKI’s market-leading products worldwide. We will then incorporate this new humanresource system in an education program so that we can give people the knowledge they require in line with ourpolicy for our workforce.
4. Basic Approach to the Selection of Accounting Standards
The Iwaki Group will continue to prepare consolidated financial statements using Japanese accounting standards
for the time being to permit comparisons with prior years and with the financial data of other companies. We willtake suitable actions with regard to the application of International Financial Reporting Standards (IFRS) by
taking into account associated factors in Japan and other countries.

7

IWAKI CO.,LTD. (6237) Financial Results for FY3/17

5. Consolidated Financial Statements and Notes(1) Consolidated Balance Sheet
FY3/16(As of Mar. 31, 2016)(Thousands of yen)
FY3/17(As of Mar. 31, 2017)

AssetsCurrent assets
Cash and deposits

5,727,118

6,191,508

Notes and accounts receivable-trade

7,390,085

6,434,549

Electronically recorded monetary claims-operating

1,021,204

1,988,682

575,408

112,738

1,976,735

1,901,218

3,204

30,1552,289,258

2,437,457

502,951502,614

Securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Deferred tax assets
Other

230,499

253,912

Allowance for doubtful accounts(27,625)(20,816)

19,688,840

19,832,021

Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation and impairment loss
Buildings and structures, net
Machinery, equipment and vehicles
Accumulated depreciation and impairment loss
Machinery, equipment and vehicles, net
Tools, furniture and fixtures
Accumulated depreciation and impairment loss
Tools, furniture and fixtures, net
Land
Leased assets
Accumulated depreciation

4,605,913

4,636,978(3,453,920)(3,514,143)

1,151,992

1,122,834

2,125,158

2,231,416(1,887,150)(1,985,609)

238,007245,807

1,495,223

1,601,918(1,267,717)(1,375,807)

227,506

226,111

1,051,883

1,036,769

498,616

485,543(291,543)(317,020)

Leased assets, net

207,073

168,523

Construction in progress

9,277

918,646

Other
Accumulated depreciation
Other, net

113,423

17,494(42,025)(11,924)

71,397

5,569

2,957,138

3,724,263

Goodwill

37,49019,718Trademark right

103,111

86,219Total property, plant and equipment
Intangible assets

Other

92,942

117,682

Total intangible assets

233,544

223,619

Investment securities

2,286,020

2,064,168

Deferred tax assets

15,061

142,215

Investments and other assets

Other
Total investments and other assets
Total non-current assets
Total assets

8

257,660

267,5712,558,742

2,473,955

5,749,425

6,421,838

25,438,265

26,253,859

IWAKI CO.,LTD. (6237) Financial Results for FY3/17(Thousands of yen)
FY3/17(As of Mar. 31, 2017)

FY3/16(As of Mar. 31, 2016)
Liabilities
Current liabilities
Notes and accounts payable-trade
Short-term loans payable

3,886,904

4,345,679

833,470

576,160

Lease obligations

85,76275,517

Income taxes payable

394,520

300,437

Provision for bonuses

720,673

716,527

Provision for directors’ bonuses-

100,120

Provision for product warranties

92,157

98,485

Other

1,106,122

818,564

Total current liabilities

7,119,610

7,031,491

Long-term loans payable

300,000

300,000

Lease obligations

136,080

106,584

Deferred tax liabilities

77,862

72,226-

151,043

Net defined benefit liability

957,580

885,513

Asset retirement obligations

201,923

205,500

Non-current liabilities

Provision for directors’ retirement benefits

Other

569,452

594,892

2,242,900

2,315,762

9,362,510

9,347,253

Capital stock

1,018,250

1,018,250

Capital surplus

638,250

638,250

Retained earnings

13,760,504

14,637,110

Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity

Treasury shares

-

(30)

15,417,004

16,293,580

Valuation difference on available-for-sale securities

371,039

250,907

Foreign currency translation adjustment

501,419

309,458

Remeasurements of defined benefit plans(240,899)(135,090)

631,559425,274

27,191

187,750

16,075,755

16,906,605

25,438,265

26,253,859

Total shareholders’ equity
Accumulated other comprehensive income

Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

9

IWAKI CO.,LTD. (6237) Financial Results for FY3/17(2) Consolidated Statements of Income and Comprehensive Income
Consolidated Statement of Income(Thousands of yen)
FY3/17
FY3/16(Apr. 1, 2015 – Mar. 31, 2016) (Apr. 1, 2016 – Mar. 31, 2017)
Net sales

24,830,493

25,146,605

Cost of sales

16,416,630

16,971,391

Gross profit

8,413,862

8,175,213

Selling, general and administrative expenses

6,880,713

6,710,002

Operating profit

1,533,149

1,465,210

Interest income

72,35330,573

Dividend income
Share of profit of entities accounted for using equity
methodForeign exchange gains

42,112

26,255

410,934

488,458-

118,014

Non-operating income

Other81,16066,075

Total non-operating income

606,561

729,377

Interest expenses

38,82925,699Foreign exchange losses

70,165-

Share issuance cost

8,907

-

Listing related expenses

13,098-Rent expenses

7,743

20,563

Other

9,064

11,618147,808

57,882

1,991,903

2,136,705

Gain on sales of non-current assets

1,023

19,996

Total extraordinary income

1,023

19,996

4,544

1,703

-

8,439

Non-operating expenses

Total non-operating expenses
Ordinary profit
Extraordinary income

Extraordinary losses
Loss on retirement of non-current assets
Provision for loss on liquidation of subsidiaries andassociates
Total extraordinary losses
Profit before income taxes

4,544

10,142

1,988,382

2,146,559

Income taxes-current

580,783

534,490

Income taxes-deferred(123,154)(84,219)457,628450,271

1,530,753

1,696,288

3,168

5,383

1,527,585

1,690,904

Total income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

10

IWAKI CO.,LTD. (6237) Financial Results for FY3/17

Consolidated Statement of Comprehensive Income(Thousands of yen)
FY3/16
FY3/17(Apr. 1, 2015 – Mar. 31, 2016) (Apr. 1, 2016 – Mar. 31, 2017)
Profit1,530,753

1,696,288(151,405)(120,131)

Foreign currency translation adjustment(138,611)(133,569)

Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities
accounted for using equity method(606,552)

105,809(65,694)(59,856)

Total other comprehensive income(962,264)(207,748)

568,489

1,488,539

567,105

1,484,620

1,384

3,919

Other comprehensive income
Valuation difference on available-for-sale securities

Comprehensive income
Comprehensive income attributable to:Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests

11

IWAKI CO.,LTD. (6237) Financial Results for FY3/17(3) Consolidated Statement of Changes in Equity
FY3/16 (Apr. 1, 2015 – Mar. 31, 2016)(Thousands of yen)
Shareholders’ equity
Capital stock
Balance at beginningof current period
Changes of items
during period
Issuance of newsharesCapital surplus

Retained earnings

380,000-

638,250

638,250Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
sharesNet changes of items
other thanshareholders’ equity
Total changes of items
during period
Balance at end ofcurrent period

Total shareholders’equityTreasury shares

12,334,834-

12,714,834

1,276,500(101,915)(101,915)

1,527,585

1,527,585

638,250

638,250

1,425,670-

2,702,170

1,018,250

638,250

13,760,504-

15,417,004(Thousands of yen)
Accumulated other comprehensive income

Balance at beginningof current period
Changes of items
during period
Issuance of newsharesValuationdifference on
available-for-salesecurities

Foreigncurrencytranslation
adjustment

522,444

703,941

Total
Remeasurements accumulated Non-controllinginterestsof defined benefit
other
plans
comprehensive
income365,653

1,592,039

29,244

14,336,119

1,276,500

Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
sharesNet changes of items
other thanshareholders’ equity
Total changes of items
during period
Balance at end ofcurrent period

Total net
assets(101,915)
1,527,585(151,405)(202,521)(606,552)(960,480)(2,053)(962,533)(151,405)(202,521)(606,552)(960,480)(2,053)

1,739,636

371,039

501,419(240,899)

631,559

27,191

16,075,755

12

IWAKI CO.,LTD. (6237) Financial Results for FY3/17

FY3/17 (Apr. 1, 2016 – Mar. 31, 2017)(Thousands of yen)
Shareholders’ equity
Capital stock
Balance at beginningof current period
Changes of items
during period
Issuance of newsharesCapital surplus

1,018,250

Retained earnings

638,250Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
sharesNet changes of items
other thanshareholders’ equity
Total changes of items
during period
Balance at end ofcurrent period

Total shareholders’equityTreasury shares

13,760,504-

15,417,004(814,298)(814,298)

1,690,904

1,690,904
(30)

(30)

-

-

876,605(30)

876,575

1,018,250

638,250

14,637,110(30)

16,293,580(Thousands of yen)
Accumulated other comprehensive income

Balance at beginningof current period
Changes of items
during period
Issuance of newsharesValuationdifference on
available-for-salesecurities

Foreigncurrencytranslation
adjustment

371,039

501,419

Total
Remeasurements accumulated Non-controllinginterestsof definedotherbenefit planscomprehensive
income(240,899)

631,559

27,191Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
sharesNet changes of items
other thanshareholders’ equity
Total changes of items
during period
Balance at end ofcurrent period

Total net
assets

16,075,755(814,298)
1,690,904(30)(120,131)(191,961)

105,809(206,284)

160,559(45,724)(120,131)(191,961)

105,809(206,284)

160,559

830,850

250,907309,458(135,090)

425,274

187,750

16,906,605

13

IWAKI CO.,LTD. (6237) Financial Results for FY3/17(4) Consolidated Statement of Cash Flows(Thousands of yen)
FY3/16
FY3/17(Apr. 1, 2015 – Mar. 31, 2016) (Apr. 1, 2016 – Mar. 31, 2017)
Cash flows from operating activities
Profit before income taxes
Depreciation
Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for directors’ bonuses
Increase (decrease) in net defined benefit liability
Increase (decrease) in provision for directors’ retirement
benefits
Interest and dividend income
Interest expenses
Share issuance cost
Listing related expenses
Foreign exchange losses (gains)Share of (profit) loss of entities accounted for using equity
methodDecrease (increase) in notes and accounts receivable-trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable-trade
Increase (decrease) in accounts payable-other
Increase (decrease) in accrued expenses
Other, net
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes paid
Income taxes refund
Net cash provided by (used in) operating activities
Cash flows from investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Proceeds from redemption of securities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Proceeds from redemption of investment securities
Proceeds from purchase of shares of subsidiaries resulting
in change in scope of consolidation
Purchase of sales of shares of subsidiaries and associates
Other, net
Net cash provided by (used in) investing activities
Cash flows from financing activities
Net increase (decrease) in short-term loans payable
Repayments of long-term loans payable
Repayments of lease obligations
Proceeds from issuance of common shares
Cash dividends paid
Dividends paid to non-controlling interests
Other, net
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

14

1,988,382
472,522
23,358(6,965)55,218(64,971)(76,432)

2,146,559
498,753
20,207(5,227)(4,126)100,120
63,184(4,428)-(114,465)
38,8298,907
13,098(88,110)(56,829)
25,699(179,061)(410,934)(488,458)(590,847)(351,069)(303,740)
44,90332,042319,278
984,574
465,629(30,012)(222,074)
215,453
1,413,569(3,846)(157,993)
569,718
3,806(9,893)(257,398)
2,265,217
418,908(22,046)(666,113)
5,553
2,001,518(1,000)1,000,000
104,700(330,876)
1,414
336,104

300,000
555,271(1,219,446)
35,714
264,205-

68,430(112,686)
997,655(103,830)(50,466)(150,121)(1,200,935)(815,472)(85,683)
1,271,579(101,915)(3,437)(935,864)(82,230)
1,393,130
4,032,987
5,426,118(232,760)(85,541)(813,470)(2,886)(17,115)(1,151,773)(14,578)
685,0455,426,118
6,111,164

IWAKI CO.,LTD. (6237) Financial Results for FY3/17(5) Notes to Consolidated Financial Statements
Going Concern Assumption
Not applicable.
Changes in Accounting Policies
Application of Practical Solution on a Change in Depreciation Method due to Tax Reform 2016
Following the revised Corporation Tax Act, Iwaki has applied the “Practical Solution on a Change inDepreciation Method due to Tax Reform 2016” (Accounting Standards Board of Japan (ASBJ) Practical Issues
Task Force (PITF) No. 32, June 17, 2016) from the current fiscal year, and changed the depreciation method forfacilities attached to buildings and structures acquired on or after April 1, 2016, from the declining-balancemethod to the straight-line method.
The effect of this change on profit in the current fiscal year is insignificant.
Reclassifications
Consolidated Statement of Income“Rent expenses,” included in “Other” under non-operating expenses in the previous fiscal year, is presented
separately from the current fiscal year due to an increase in its monetary materiality.
Additional Information
Application of Guidance on Recoverability of Deferred Tax Assets
Iwaki has applied the “Guidance on Recoverability of Deferred Tax Assets” (ASBJ Guidance No. 26, March 28,2016) from the current fiscal year.
Business Combinations
Business combination through acquisition(1) Summary of business combination
1) Acquired company and its business activities
Acquired company: TechnoECHO Co., Ltd.
Business activities: Design, manufacture and sale of residual chlorine meters
2) Reasons for acquisition
Acquiring TechnoECHO will make it possible to perform efficient and effective sales activities for both theresidual chlorine meters of this company and the chemical pumps of Iwaki. This acquisition will also
provide the flexibility to meet the exacting demands of customers.
In addition, Iwaki will provide financial and other support for the development of residual chlorine meters inorder to develop new meters faster.
3) Acquisition date
December 26, 2016 (stock acquisition date)
December 31, 2016 (assumed acquisition date)4) Legal form of acquisition
Acquisition of shares with cash5) Company’s name after acquisition
There is no change in the company’s name.

15

IWAKI CO.,LTD. (6237) Financial Results for FY3/17

6) Percentage of voting rights acquired
70%7) Basis for choosing the company to acquire
Iwaki acquired the shares in exchange for consideration in cash.
(2) Period of the acquired company’s performance included in the consolidated financial statements
The results operations of the acquired company from January 1, 2017 to March 31, 2017 are included in the
consolidated financial statements as the assumed acquisition date is December 31, 2016.
(3) Acquisition cost of acquired company and breakdown by type of consideration
Payment for the acquisition:

Cash and deposits

377,269 thousand yen

Acquisition cost:

377,269 thousand yen(4) Details of major acquisition-related costs
Advisory fees, etc.: 1,700 thousand yen(5) Goodwill resulting from the acquisition
1) Value of goodwill
5,041 thousand yen
2) Source of goodwill
Since the net amount of assets acquired and liabilities assumed was less than the acquisition cost, thedifference was recognized as goodwill.
3) Amortization method and amortization period
Goodwill is amortized over five years by the straight-line method.
(6) Breakdown of assets acquired and liabilities assumed on the acquisition dateCurrent assets(Thousands of yen)
696,884

Non-current assets

46,688

Total assets

743,573

Current liabilities

42,968Non-current liabilities

168,850

Total liabilities

211,819(7) Estimated effect of the business combination on the consolidated statement of income if the businesscombination had been at the beginning of the current fiscal year
Omitted due to the difficulty of calculating an estimate.

16

IWAKI CO.,LTD. (6237) Financial Results for FY3/17

Segment and Other Informationa. Segment information
Omitted because chemical pumps are the only business of the Iwaki Group.
b. Related information
FY3/16 (Apr. 1, 2015 – Mar. 31, 2016)
1. Information by product or service
Magnetic drive
pumps

Metering pumps

8,462,919

External sales

Air pumps
1,466,944(Thousands of yen)
Rotary displacement
pumps

Pneumatic drive
pumps

4,556,124

1,768,358

System products

Purchased products

1,183,929

2,209,198

2,504,836
Other

Total

2,678,182

24,830,493

2. Information by region(1) Net sales
Japan

Europe15,671,210

Americas2,377,712

Asia

3,345,394

China

1,787,235

Other

777,461(Thousands of yen)Total

871,479

24,830,493

Note: Classification of net sales is based on the location of the client and categorized by country or region.

(2) Property, plant and equipment
Japan

Europe2,428,446

Americas339,177(Thousands of yen)
Total

Asia

121,399

68,114

2,957,138

3. Information by major client
Omitted because no specific external client accounts for 10% or more of net sales in the consolidated statement ofincome.
FY3/17 (Apr. 1, 2016 – Mar. 31, 2017)
1. Information by product or service
Magnetic drivepumps
8,769,139

External sales

Air pumps
1,436,812

Metering pumps

Pneumatic drive
pumps(Thousands of yen)
Rotary displacementpumps

4,537,462

1,984,611

2,342,628

System products

Purchased products

1,092,167

2,192,079

Other

Total

2,791,703

25,146,605

2. Information by region(1) Net sales
Japan

EuropeAmericas15,935,669

2,271,659

Asia

3,273,439

China

2,095,442

Other764,135(Thousands of yen)Total

806,259

Note: Classification of net sales is based on the location of the client and categorized by country or region.

(2) Property, plant and equipment
Japan3,184,958

Europe348,059

Americas(Thousands of yen)
Total

Asia

131,70217

59,542

3,724,263

25,146,605

IWAKI CO.,LTD. (6237) Financial Results for FY3/17

3. Information by major client
Omitted because no specific external client accounts for 10% or more of net sales in the consolidated statement ofincome.
c. Information related to impairment losses on non-current assets for each reportable segment
Not applicable.
d. Information related to goodwill amortization and the unamortized balance for each reportable segment
Omitted because chemical pumps are the only business of the Iwaki Group.
e. Information related to gain on bargain purchase for each reportable segment
Not applicable.
Per Share Information
FY3/16(Apr. 1, 2015 – Mar. 31, 2016)(Yen)
FY3/17(Apr. 1, 2016 – Mar. 31, 2017)

Net assets per share

2,144.27

2,233.84

Net income per share

223.99225.93

Notes: 1. Diluted net income per share is not presented because there are no latent shares.
2. The basis of calculating the net income per share is as follows:
FY3/16(Apr. 1, 2015 – Mar. 31, 2016)

FY3/17(Apr. 1, 2016 – Mar. 31, 2017)

Net income per share
Profit attributable to owners of parent (Thousands ofyen)
Amount not attributable to common shareholders(Thousands of yen)
Profit attributable to owners of parent applicable tocommon shares (Thousands of yen)
Average number of shares outstanding (Shares)

1,527,585

1,690,904--

1,527,585

1,690,904

6,819,697

7,484,357

Subsequent Events
Not applicable.
6. Others
Change in Directors
1) Changes in representative
Not applicable.
2) Changes in other directors
Candidates for directors
Director: Makoto Inoue (currently Senior General Manager of Business Management Head Office)Director: Takashi Shimizu (currently Senior General Manager of Product Planning Head Office)Director: Toshinori Yanagihara (currently Senior General Manager of Engineering Head Office)3) Effective dateJune 29, 2017
This financial report is solely a translation of “Kessan Tanshin” (in Japanese, including attachments), which has been
prepared in accordance with accounting principles and practices generally accepted in Japan, for the convenience ofreaders who prefer an English translation.

18