Financial Results for Second Quarter of Fiscal Year Ending March 31, 2020
[Japanese GAAP] (Consolidated Data)
November 7, 2019
Company Name:

Nikko Co., Ltd.

Stock Code:

6306

Representative:
For inquiries:
Scheduled date for filing thequarterly report:
Quarterly earnings supplementary
explanatory materials:
Quarterly financial results briefing
session:

Stock Exchange Listing: Tokyo Stock Exchange
URL: http://www.nikko-net.co.jp
Representative Director
Masaru Tsuji
and PresidentManaging Director andGeneral Manager of the Hiroshi Fujii
Telephone: +81-78-947-3141
Financial Division
Scheduled date for cash
November 14, 2019
December 5, 2019
dividends:
Yes
Yes (for institutional investors, analysts and newspaper reporters)(Amounts rounded down to the nearest million yen)
1. Consolidated Performance for Second Quarter of Fiscal Year Ending March 31, 2020
(April 1, 2019 - September 30, 2019)(1) Consolidated Operating Results (cumulative)(% represents year-on-year change)

Net sales

Six months ended
September 30, 2019
Six months ended
September 30, 2018
Note: Comprehensive
income:Ordinary income

Quarterly net income
attributable to ownersof parent

million yen%

million yen%

millionyen%

million yen%

17,140

16.6

959

102.3

1,034

73.6

1,003

77.8

14,697(9.0)

474(41.4)

595(35.6)

564(24.1)

Six months ended
September 30, 2019

Six months ended
September 30, 2019
Six months ended
September 30, 2018

Operating income

Six months ended
September 30, 2018

384 million yen (-17.8%)

Quarterly net income
per share

Diluted quarterly net
income per share

yen

yen

26.12

－

14.73

－

467 million yen (-62.3%)

The Company carried out a one-to-five split of its common stock effective on October 1, 2019. Quarterly net income per share wascalculated assuming that the split took place at the beginning of the previous fiscal year.

(2) Consolidated Financial Position
Total assets
million yen
Six months ended
45,340
September 30, 2019
Fiscal year ended
43,969March 31, 2019
(Reference) Capital:

Six months ended
September 30, 2019

Net assets
million yen%

Net assets per shareyen

30,83568.0

795.2530,41469.2

793.7630,835 million yen

Equity ratio

Fiscal year ended
March 31, 2019

30,414 million yen

The Company carried out a one-to-five split of its common stock effective on October 1, 2019. Quarterly net assets per share wascalculated assuming that the split took place at the beginning of the previous fiscal year.

– 1 –2. Dividends
End of 1Q
yen

Annual dividends
End of 2Q
End of 3Q
yenyen

Year-end
yen

Fiscal year ended
－
－
30.00
30.00
March 31, 2019
Fiscal year ending－
100.00March 31, 2020
Fiscal year ending
March 31, 2020－
20.00
(Forecasts)(Note) Revision of previously announced dividend targets during this reporting period: None

Total
yen
60.00

－

The Company carried out a one-to-five split of its common stock effective as of October 1, 2019. The year-end dividend target figure forthe fiscal year ending March 31, 2020 (forecast) takes this stock split into account and “-” is entered for the total annual dividends. Notethe change this time is due solely to the stock split and in effect does not change the initial year-end dividend target forecast of 100.00 yen
per share.

3. Consolidated Performance Forecast for the Fiscal Year Ending March 31, 2020 (April 1, 2019 - March 31, 2020)(% represents year-on-year change)
Net income per
Net income per
Ordinary income share attributable toshareowners of parent
millionmillionmillionmillion
%
%
%
%
yen
yen
yen
yen
yen
Full year
35,700
12.3
2,300
61.2
2,500
58.5
2,000
48.7
52.21
(Note) Revision of previously announced earnings forecasts during this reporting period: None
Net sales

Operating income

The Company carried out a one-to-five split of its common stock effective as of October 1, 2019. The net income per share target figure
for full fiscal year ending March 31, 2020 takes this stock split into account. Note the change this time is due solely to the stock split and in
effect does not change the initial forecast full-year net income target of 261.04 yen.

– 2 –Notes(1) Changes in important subsidiaries during the period under review (changes in specific subsidiaries which involve
changes in the scope of consolidation): None
Newly added companies: None (Company names: －) / Excluded companies: None (Company names: －)(2)

Use of special accounting methods for preparation of quarterly consolidated financial statements: None

(3)

Changes in accounting policy, changes in accounting estimates, and retrospective restatements(i) Changes in accounting policy arising from revision of accounting standards, etc.: None(ii) Changes in accounting policy other than those noted in (i) above: None(iii) Changes in accounting estimates: None(iv) Retrospective restatements: None(4)

Shares issued (common stock)(i) Number of shares outstandingat end of period (including
treasury shares)(ii) Number of shares held intreasury at end of period(iii) Average number of shares
outstanding during the period(quarter-to-date)(Note)

2Q of fiscal year
ending March 31, 2020

40,000,000 sharesFiscal year ended
March 31, 201940,000,000 shares

2Q of fiscal year
ending March 31, 2020

1,225,600 sharesFiscal year ended
March 31, 2019

1,682,845 shares

2Q of fiscal year
ending March 31, 2020

38,407,295 shares

2Q of fiscal year
38,298,935 shares
ended March 31, 2019

The company carried out a one-to-five split of its common stock effective on October 1, 2019. Number of shares outstanding at
end of period, number of shares held in treasury at end of period, and average number of shares outstanding during the period
were calculated, assuming that the split took place at the beginning of the previous fiscal year.

*

This quarterly report is not subject to quarterly review procedures by certified public accountants or an auditing firm.

*

Explanation of the appropriate use of earnings forecasts, and other special notes(Cautionary statement with respect to forward-looking statements)
Any forecasts and forward-looking statements given herein are based on information available as of this report’s
publication and on certain assumptions that are deemed reasonable and these forecasts are not guarantees of future
performance.
Actual results may differ significantly from forecasts due to various factors. For the assumptions underlying theforecasts herein and other notice on the use of earnings forecasts, please refer to “1. Qualitative Information on
Quarterly Results: (3) Explanation About Forward-Looking Statements, Including Forecast of Consolidated Financial
Results” on page 2 in the accompanying materials.
(How to obtain quarterly earnings supplementary explanatory materials)
The Company is scheduled to post the quarterly earnings supplementary explanatory materials on its website on
Thursday, November 7, 2019.

– 3 –Accompanying Material – Table of Contents
1. Qualitative Information on Quarterly Results ................................................................................................................... 5(1) Explanation About Operating Results ...................................................................................................................... 5(2) Explanation About Financial Position ....................................................................................................................... 5(3) Explanation About Forward-Looking Statements, Including Forecast of Consolidated Financial Results ................ 5
2. Quarterly Consolidated Financial Statements and Notes ................................................................................................ 6(1) Quarterly Consolidated Balance Sheet .................................................................................................................... 6(2) Quarterly Consolidated Statement of Income and Quarterly Consolidated Statement of Comprehensive Income .. 8
Quarterly Consolidated Statement of Income
Six Months Ended September 30, 2019............................................................................................................. 8
Quarterly Consolidated Statements of Comprehensive Income
Six Months Ended September 30, 2019............................................................................................................. 9(3) Notes to Quarterly Consolidated Financial Statements ...........................................................................................10(Going Concern Assumption)..................................................................................................................................10(Notes on significant changes in the amount of shareholders’ equity) ....................................................................10(Use of special accounting methods for preparation of quarterly consolidated financial statements) .....................10(Changes in Accounting Policy) ..............................................................................................................................10(Additional Information) ...........................................................................................................................................10– 4 –1. Qualitative Information on Quarterly Results(1) Explanation About Operating Results
The global economy faced increased uncertainties during the reporting period amid concerns over the trade friction
between the United States and China and Brexit in the UK, and the situation continues to be unpredictable. On theother hand, the Japanese economy remains on a gradual recovery track as corporate earnings as well as
employment and income environment improved, on the back of continuation of the reflationary policy of the Bank ofJapan and the government. However, the economic outlook is becoming uncertain given the concerns over the
impact of the increased consumption tax rate on the economy.
Amid such circumstances, while the construction industry, which has a significant bearing on our group, remains
stable, uncertainties remain as issues such as the rise in material and logistics costs and the risk of work delays
due to labor shortage are yet to be solved.
In the six months ended September 30, 2019, consolidated net sales increased 16.6% from a year earlier to17,140 million yen. Consolidated operating income totaled 959 million yen, up 102.3% year-on-year, consolidated
ordinary income totaled 1,034 million yen, up 73.6% year-on-year, and quarterly net income attributable to ownersof parent reached 1,003 million yen, up 77.8% year-on-year.
In order to have an appropriate grasp of the operational situation and disclosure of the quarterly consolidated
financial statements, the Company has used financial statements dated December 31 for two of the overseas
subsidiaries that settle accounts on that date, including Nikko (Shanghai) Construction Machinery Co., Ltd., andintroduced necessary adjustments on important transactions that occurred before the consolidated settlement date.
From the first quarter of the current fiscal year, we have introduced a method to conduct provisional settlement on
the consolidated settlement date of March 31 for these companies and consolidate them.
Due to this change, for the fiscal second quarter, accounts for the nine months between January 1, 2019 and
September 30, 2019 were consolidated.
Results by segment are as follows.
<Asphalt Plant-Related Business>
While net sales of products as well as maintenance business in Japan declined from the same period a year ago,
overseas net sales increased, driven by increased exports and pushed up by the introduction in the first quarter ofthe method of provisionally settling accounts of Nikko (Shanghai) Construction Machinery Co., Ltd. on the quarterly
consolidated account settlement date. As a result, net sales of the business rose 10.6% from the same period ayear earlier to 8,667 million yen.
<Concrete Plant-Related Business>
Net sales of products increased from the same period a year earlier, as the level of order backlog at the beginningof the period was higher than the previous fiscal year. Net sales of the maintenance business increased from thesame period a year ago. As a result, net sales of the business increased 18.0% from the same period a year
earlier to 4,569 million yen.
<Environment- and Conveyor-Related Business>
Net sales of both environmental products and conveyer products increased compared with the same period a year
earlier. As a result, net sales of the business increased 23.2% to 1,353 million yen from the same period a year
earlier.
<Other Business>
Net sales of temporary construction materials, crushers, and waterproof boards increased compared with the same
period a year earlier. As a result, net sales of the business increased 34.6% to 2,549 million yen from the same
period a year earlier.
(2) Explanation About Financial Position
Total assets at the end of the reporting period was 45,340 million yen, increasing 1,371 million yen from the end of
the previous fiscal year.
Current assets came to 31,045 million yen, increasing 1,654 million yen from the end of the previous fiscal year.
Main factors contributing to these increases are an increase of 3,039 million yen in cash and deposits, 1,097
million yen increase in inventories, and a 132 million yen rise in other, while notes and accounts receivable-tradedecreased 1,775 million yen and electronically recorded monetary claims fell 625 million yen. Non-current assets
came to 14,294 million yen, decreasing 283 million yen from the end of the previous fiscal year. Main factors
contributing to the change include an increase of 236 million yen in construction in progress and an increase of 162
million yen in deferred tax assets and a decrease of 865 million yen in investment securities.
Liabilities totaled 14,505 million yen, increasing 950 million yen from the end of the previous fiscal year. The
increase was mainly the accounts payable-factoring increasing 302 million yen, an increase of 201 million yen inelectronically recorded obligations, an increase of 112 million yen in income taxes payable, and an increase of 396
million yen in the other portion of current liabilities as well as a 111 million yen drop in accounts payable-other anda 92 million yen decrease in deferred tax liabilities.
Net assets came to 30,835 million yen, up 420 million yen from the end of the previous fiscal year. Factors
contributing to the change include an increase from recording of 1,003 million yen in net income attributable toowners of parent, a decrease of 485 million yen in valuation difference on available-for-sale securities and a
decline from payment of 229 million yen in dividends.
As a result, equity ratio declined to 68.0% from 69.2% as of the end of the previous fiscal year.
(3) Explanation About Forward-Looking Statements, Including Forecast of Consolidated Financial Results
There is no change in the performance forecast for the year ending March 31, 2020 that was disclosed on May 10,
2019.
– 5 –

2. Quarterly Consolidated Financial Statements and Notes(1) Quarterly Consolidated Balance Sheet(Mil. yen)
As of March 31, 2019
AssetsCurrent assets
Cash and cash equivalents
Notes and accounts receivable-trade
Electronically recorded monetary claims
Merchandise and finished goods
Work in process and partly-finishedconstruction
Raw materials and supplies
Consumption taxes receivable
Other business
Allowance for doubtful accounts
Total current assets
Non-current assets
Property and equipment
Intangible assets
Investments and other assets
Investment securities
Investments in capital
Long-term loans receivable
Deferred tax assets
Other business
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets– 6 –As of September 30, 2019

10,347
10,731
1,628
1,190

13,387
8,955
1,003
1,362

3,903

4,606

933
209
453
(7)
29,390

1,156
585
(12)
31,045

6,507
418

6,859
404

5,976
11
6
576
1,234
(152)
7,652
14,57843,969

5,110
11
11
738
1,308
(151)
7,030
14,29445,340(Mil. yen)
As of March 31, 2019
Liabilities
Current liabilities
Notes and accounts payable-trade
Electronically recorded obligations
Accounts payable-factoring
Short-term loans payable
Income taxes payable
Accounts payable-other
Provision for bonuses
Provision for directors' bonuses
Provision for loss on order received
Other businessTotal current liabilities
Long-term liabilities
Long-term loans payable
Deferred tax liabilities
Provision for directors' retirement benefits
Retirement benefit-related liabilities
Other businessTotal noncurrent liabilities
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Foreign currency translation adjustment
Accumulated retirement benefit-related
adjustment
Total accumulated other comprehensive
incomeTotal net assets
Total liabilities and net assets– 7 –As of September 30, 2019

2,270
938
2,449
1,532
421
572
412
52
35
2,095
10,781

2,370
1,139
2,751
1,491
534
461
451
6
42
2,491
11,740

186
98
135
2,010
342
2,773
13,554

259
5
134
2,035
328
2,764
14,505

9,197
7,808
12,049(576)
28,478

9,197
7,918
12,822(420)
29,518

2,010

1,524

163

23

(238)

(230)

1,935

1,317

30,41443,96930,83545,340(2) Quarterly Consolidated Statement of Income and Quarterly Consolidated Statement of Comprehensive Income(Quarterly Consolidated Statement of Income)(Six Months Ended September 30, 2019)(Mil. yen)
Six Months Ended September Six Months Ended September
30, 2018 (from April 1, 2018 30, 2019 (from April 1, 2019
to September 30, 2018)
to September 30, 2019)
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividends income
Other businessTotal non-operating income
Non-operating expenses
Interest expenses
Loss on disposal of noncurrent assets
Foreign exchange losses
Compensation for damage
Other businessTotal non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of investment securities
Total extraordinary income
Extraordinary loss
Loss on sales of investment securities
Loss on valuation of investments in capital
Total extraordinary loss
Quarterly income before income taxes
Income taxes-current
Income taxes-deferred
Total income taxes
Quarterly net income
Quarterly net income attributable to owners of parent– 8 –14,697
10,864
3,832
3,358
474

17,14012,414
4,725
3,766
959

1
114
40
156

1
108
29
138

20
1
5
4
3
35
595

26
0
28
4
4
63
1,034

309
309

454
454

44
44
860
277
19
296
564
564

4
4
1,484
552
(70)
481
1,003
1,003

(Quarterly Consolidated Statements of Comprehensive Income)(Six Months Ended September 30, 2019)(Mil. yen)
Six Months Ended September Six Months Ended September
30, 2018 (from April 1, 2018 30, 2019 (from April 1, 2019
to September 30, 2018)
to September 30, 2019)
Quarterly net income
Other comprehensive income
Valuation difference on available-for-salesecurities
Foreign currency translation adjustment
Retirement benefit-related adjustment
Total other comprehensive income
Quarterly comprehensive income(Breakdown)
Quarterly comprehensive income attributable toowners of parent

– 9 –

564

1,003

(22)

(485)

(78)
3
(96)
467

(140)
7
(618)
384

467

384

(3) Notes to Quarterly Consolidated Financial Statements(Going Concern Assumption)
Not applicable(Notes on significant changes in the amount of shareholders’ equity)
Not applicable(Use of special accounting methods for preparation of quarterly consolidated financial statements)
Not applicable(Changes in Accounting Policy)
Not applicable(Additional Information)
Not applicable– 10 –