Summary of Financial Statements for the First Quarter of Fiscal Year Ending April 2020
[Japan GAAP] (Consolidated)

August 30, 2019

Name of listed company:

AIN HOLDINGS INC.

Exchange listed on:First Section of Tokyo Stock Exchange and Sapporo Securities Exchange

Code number:

9627

URL:

https://www.ainj.co.jp/

Representative:
Inquiries:

Kiichi Otani, President and Representative Director
Toshihide Mizushima, Representative Senior Managing Director
TEL: +81-11-814-1000
Date of filing quarterly securities report:
September 17, 2019–

Start of dividend payment:
Supplementary documents for quarterly results:
Quarterly results briefing:

Yes (Supplementary materials for the quarterly results are disclosed on the
Company’s website appropriately as the financial statements.)

No(Amounts are rounded down to the nearest million yen.)
1. Consolidated results for the first quarter of fiscal year ending April 30, 2020 (May 1, 2019 to July 31, 2019)(1) Consolidated operating results(Percentage figures show year-on-year changes.)
Profit attributable to
Net sales
Operating income
Ordinary income
owners of parent
Three months ended July 31, 2019
Three months ended July 31, 2018
(Note) Comprehensive income:Million yen%

Million yen%

Million yen%

Million yen%

72,461

11.5

3,921

13.6

4,212

16.7

2,240

21.0

65,013(1.6)
3,450(12.9)
3,610 (12.7)
Three months ended July 31, 2019: ¥2,180 million (+17.6%)
Three months ended July 31, 2018: ¥1,854 million (-12.7%)

1,851(12.7)

Earnings
per share

Diluted earnings
per share
Yen

Yen

Three months ended July 31, 2019

63.24

–

Three months ended July 31, 2018

52.27

–

(2) Consolidated financial position
Net assets

Total assets
As of July 31, 2019
As of April 30, 2019
(Reference) Shareholders’ equity:

Shareholders’equity ratio

Million yen

Million yen%

186,543

104,15455.8

189,021103,922

As of July 31, 2019: ¥104,091 million

54.9
As of April 30, 2019: ¥103,855 million

2. Dividends

Year ended April 30, 2019

End of firstquarter
Yen–

Dividend per share
End of third
quarterYen–
0.00

End of second
quarter
Yen–
Year ending April 30, 2020
Year ending April 30, 2020
0.00
(forecast)(Note) Revision to the most recently announced dividend forecasts: No–

End of year

Full year

Yen

Yen

55.00

55.00

55.00

55.00

3. Consolidated financial forecasts for the fiscal year ending April 30, 2020 (May 1, 2019 to April 30, 2020)(Percentage figures show year-on-year changes.)
Profit attributable toEarnings
Net sales
Operating income
Ordinary income
owners of parent
per share
Million yen%
Million yen%
Million yen%
Million yen%
Yen
First six
144,050
9.3
8,500
26.3
8,750
24.7
4,640
27.5
130.97monthsFull year
300,330
9.0
18,70016.4
19,20015.4
10,13012.2
285.94(Note) Revision to the most recently announced consolidated financial forecasts: No*Notes(1) Major changes in subsidiaries during the period (changes in specified subsidiaries resulting from changes in scope of
consolidation): No
Newly consolidated: –Excluded: –(2) Application of specified accounting methods for the preparation of quarterly consolidated financial statements: Yes(Note) For detail, please refer to “2. Quarterly consolidated financial statements and major notes (3) Notes on quarterly
consolidated financial statements” on page 8 of the Attachment.
(3) Changes in accounting principles, changes in accounting estimates, and restatement of revisions
1) Changes in accounting principles as a result of revisions to accounting standards, etc.:
No2) Changes in accounting principles other than 1):
No3) Changes in accounting estimates:
No4) Restatement of revisions:No(4) Number of outstanding shares (common stock)1) Number of outstanding
shares (including treasury
As of July 31, 2019
stock):
2) Number of shares held in
As of July 31, 2019
treasury:
3) Average number ofThree months ended
shares outstanding:July 31, 201935,428,212 shares As of April 30, 201935,428,212 shares

728 shares As of April 30, 2019728 shares

Three months ended
July 31, 201835,427,524 shares

35,427,484 shares*This Summary of Financial Statements is outside the scope of quarterly review procedures.
*Statement regarding the proper use of financial forecasts and other special remarks(Caution concerning forward-looking statements)
The above forecasts are calculated based on the information available as of the publication date of this material, and actual
financial results may vary due to change in future economic conditions and others.

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2020

Contents of the Attachment
1. Qualitative information on consolidated results for the period under review............................................................................ 2(1) Consolidated operating results ........................................................................................................................................... 2(2) Consolidated financial position ........................................................................................................................................... 2(3) Forecast of consolidated financial results and other forward-looking information............................................................... 3
2. Quarterly consolidated financial statements and major notes ................................................................................................. 4(1) Quarterly consolidated balance sheet ................................................................................................................................ 4(2) Quarterly consolidated statements of income and comprehensive income ........................................................................ 6
Quarterly consolidated statement of income ....................................................................................................................... 6
Quarterly consolidated statement of comprehensive income.............................................................................................. 7(3) Notes on quarterly consolidated financial statements ........................................................................................................ 8(Notes on the premise of a going concern)......................................................................................................................... 8(Note on significant changes in the amount of shareholders’ equity).................................................................................. 8(Application of specified accounting methods for the preparation of quarterly consolidated financial statements) ............. 8(Segment information, etc.) .............................................................................................................................................. 8

1

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2020

1. Qualitative information on consolidated results for the period under review(1) Consolidated operating results
During the first three months of the current fiscal year (May 1, 2019 to July 31, 2019), the Japanese economy recoveredat a modest pace, supported by a steady improvement in employment conditions, signs of a pickup in consumer spending
and a continued strong level of corporate earnings, despite weakness in some areas, particularly exports.
In this economic environment, the AIN HOLDINGS Group (the Group) worked to expand its business and increase
earnings. Specifically, the Group opened new dispensing pharmacies and used M&A to expand the business. It also
developed its cosmetic and drug store business.
In the first three months of the fiscal year, net sales increased 11.5% year on year to ¥72,461 million, operating income
increased 13.6% to ¥3,921 million, ordinary income increased 16.7% to ¥4,212 million, and profit attributable to owners ofparent increased 21.0% to ¥2,240 million.
Financial results by business segment are as follows.
(Dispensing pharmacy business)
In drug price and dispensing fee revisions in April 2018, the role of pharmacies located near hospitals and pharmacies
located in the same premises was reviewed, with primary care dispensing pharmacies and pharmacists receiving a higher
evaluation as part of government efforts to drive a structural shift from dispensing focused only on dispensing drugs todispensing focused on services that contribute to local healthcare services.
To ensure our pharmacists and dispensing pharmacies fulfill their primary care role, the Group continues to build links
with local medical service providers, strengthen pharmaceutical management and guidance based on the integrated andcontinuous management of drug information using patient medication notebooks and other means, and promote wider
use of generic drugs. In addition, we stepped up training for the 257 newly graduated pharmacists that joined the Group in
April 2019 in order to enhance their skills as primary care pharmacists.
In business development, the Group pushed ahead with business expansion by opening new dispensing pharmacies
and using M&A deals. Store operations are also being overhauled.
As a result, for the first three months of the fiscal year, the dispensing pharmacy business reported sales of ¥64,800
million, up 13.5% year on year, and segment income of ¥4,804 million, up 20.6%.
During the period under review, the Group opened five new dispensing pharmacies, including those acquired throughM&A deals, and closed 17 pharmacies, resulting in a total of 1,120.
(Cosmetic and drug store business)
In the cosmetic and drug store business, the market environment remained challenging due to a narrowing competitive
gap between companies in the sector and the emergence of new competitors from sector consolidation and realignmentthat also extends to other business sectors.
Against that backdrop, the Group continues to open ainz & tulpe cosmetic and drug stores in the Tokyo metropolitanarea, as well as strategically develop sales areas at each store, based on the concept of creating stores where womencustomers would be happy to browse for an hour. Also, the Group has resumed store openings in major urban markets
outside the Tokyo metropolitan area to capitalize on the ainz & tulpe brand’s rising visibility and name recognition. The
Group also continues to work on improving profitability by reducing costs and developing LIPS and HIPS, cocodecica andother original brands.
As a result, for the first three months of the fiscal year, the cosmetic and drug store business reported an increase insales of 0.8% year on year to ¥6,560 million and a decline in segment income of 36.9% to ¥230 million.
During the same period, the Group opened ainz & tulpe stores: ainz & tulpe bono SAGAMIONO (Sagamihara,
Kanagawa Prefecture), ainz & tulpe ASAKUSA ROX (Taito Ward, Tokyo), ainz & tulpe PERIE Chiba (Chiba, Chiba
Prefecture) and closed two stores, resulting in a total of 55 cosmetic and drug stores at the end of the period.
(Other businesses)
Net sales from other businesses decreased 22.4% year on year to ¥1,100 million and segment loss was ¥51 million
compared with the loss of ¥67 million a year earlier.
(2) Consolidated financial position
The balance of total assets at the end of the first quarter decreased by ¥2,477 million from the end of the previous fiscal
year to ¥186,543 million.
That mainly reflected an increase in accounts receivable and inventories against decreases in cash on hand and inbanks and goodwill.
The balance of liabilities decreased ¥2,709 million to ¥82,389 million, mainly reflecting an increase in accounts payableand decreases in accrued income taxes and the balance of long-term debt.
2

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2020

The balance of short- and long-term debts decreased by ¥1,497 million to ¥10,059 million.
Total net assets increased by ¥232 million to ¥104,154 million and the shareholders’ equity ratio improved 0.9
percentage points to 55.8%.
(3) Forecast of consolidated financial results and other forward-looking information
The Group has made no change to its earnings forecasts for the first six months of the fiscal year and for the full fiscal
year, announced on June 4, 2019.

3

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2020

2. Quarterly consolidated financial statements and major notes(1) Quarterly consolidated balance sheet(Million yen)

AssetsCurrent assets
Cash on hand and in banks
Notes and accounts receivable
Merchandise
Supplies
Short-term loans
Other accounts receivable
Other current assets
Allowance for doubtful accounts
Total current assets
Fixed assets
Property, plant and equipment
Buildings and structures, net
Land
Other property, plant and equipment, net
Total property, plant and equipment
Intangible fixed assets
Goodwill
Other intangible fixed assets
Total intangible fixed assets
Investments and other assets
Investment securities
Deferred tax assets
Deposits and guarantees
Other investments and other assets
Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
Deferred assets
Total assets

4

Fiscal year endedApril 30, 2019
(As of April 30, 2019)

Three months ended
July 31, 2019
(As of July 31, 2019)

48,091
12,771
12,673
225
236
8,438
3,012
(2)
85,44640,753
15,94013,752234
265
10,542
1,825(2)83,311

16,352
10,394
3,439
30,186

16,355
10,484
3,377
30,21645,2492,327
47,57744,2162,414
46,6301,795
4,284
15,133
6,221(1,683)25,751
103,51559
189,021

1,820
4,276
15,0786,844(1,683)
26,336103,184
48
186,543

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2020

(Million yen)

Liabilities
Current liabilities
Accounts payable
Short-term debt
Accrued income taxes
Deposits received
Allowance for bonuses to employees
Allowance for bonuses to directors
Reserve for reward obligations
Other current liabilities
Total current liabilities
Long-term liabilities
Long-term debt
Net defined benefit liability
Other long-term liabilities
Total long-term liabilities
Total liabilities
Net assets
Shareholders’ equity
Common stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Unrealized holding gains on securities
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

5

Fiscal year endedApril 30, 2019
(As of April 30, 2019)

Three months ended
July 31, 2019
(As of July 31, 2019)

44,794
5,571
3,261
12,737
2,139
17
450
4,772
73,744

46,194
5,045
1,744
13,033
1,665
8
455
3,820
71,967

5,985
2,977
2,391
11,35585,099

5,014
3,034
2,373
10,421
82,38921,89420,50061,526(2)
103,920

21,89420,50061,818(2)
104,212

(6)
(59)
(65)
67
103,922
189,021

(66)
(54)
(121)
62
104,154
186,543

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2020

(2) Quarterly consolidated statements of income and comprehensive income
Quarterly consolidated statement of income

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Commissions received
Real estate rental revenue
Consignment income
Other non-operating income
Total non-operating income
Non-operating expenses
Interest expenses
Losses on sales of accounts receivables
Real estate rental expenses
Other non-operating expenses
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of fixed assets
Gain on transfer of business
Other extraordinary income
Total extraordinary income
Extraordinary losses
Losses on disposal and sales of fixed assets
Other extraordinary losses
Total extraordinary losses
Profit before income taxes
Income taxes
ProfitLosses attributable to non-controlling interests
Profit attributable to owners of parent

6(Million yen)Three months ended
July 31, 2018
(May 1, 2018 to
July 31, 2018)
65,01354,325
10,6877,236
3,450

Three months ended
July 31, 2019
(May 1, 2019 toJuly 31, 2019)72,46160,971
11,490
7,568
3,921

13
23
9
48
42
110
248

14
19
5
211
43
87
382

25
17
16
29
89
3,610

19
15
33
22
91
4,212

3
83
0
87

0
117
0
118

174
80
254
3,442
1,597
1,845
(6)
1,851

216
22
239
4,092
1,856
2,236
(4)
2,240

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2020

Quarterly consolidated statement of comprehensive income

ProfitOther comprehensive income:Unrealized holding gains on securities
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests

7(Million yen)Three months ended
July 31, 2018
(May 1, 2018 to
July 31, 2018)
1,845

Three months ended
July 31, 2019
(May 1, 2019 toJuly 31, 2019)
2,236

10
(1)
9
1,854
1,861

(60)
4
(55)
2,180
2,184

(6)

(4)

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2020

(3) Notes on quarterly consolidated financial statements(Notes on the premise of a going concern)
There are no applicable matters to be reported.

(Notes on significant changes in the amount of shareholders’ equity)
There are no applicable matters to be reported.
(Application of specified accounting methods for the preparation of quarterly consolidated financial statements)
To calculate tax expenses, the effective tax rate on income before income taxes for the consolidated fiscal year after theapplication of tax effect accounting is reasonably estimated and the estimated rate is applied to income before income taxes
for the quarterly period.
(Segment information, etc.)
I Three months ended July 31, 2018 (May 1, 2018 to July 31, 2018)
1. Net sales and income (loss) by reportable segment
Reportable segments
Adjustments(Note) 1(Million yen)
Carried onquarterly
consolidated
statements ofincome(Note) 2

Dispensing
pharmacybusiness

Cosmetic anddrug store
business

Otherbusinesses(1) Sales to third parties

57,090

6,505

1,417

65,013－65,013(2) Intersegment sales

－

－

38

38

(38)

－

Total sales

57,090

6,505

1,456

65,051(38)

65,013

Segment income (loss)

3,984

364

(67)

4,281

(671)

3,610

Total

Sales

Notes:

1. The adjustment of ¥(671) million to segment income (loss) includes ¥1,109 million in corporate expenses, ¥(427)
million in (income) loss that is not allocated to reportable segments, and ¥(10) million in eliminations due tointersegment transactions.
Overall group expenses consist mainly of expenses associated with the administrative departments of the parent
company, such as general affairs and accounting departments.
2. Segment income (loss) is adjusted with the ordinary income of quarterly consolidated statements of income.

2. Impairment losses on fixed assets and goodwill by reportable segment[Significant impairment losses on fixed assets]:
There are no applicable matters to be reported.
[Significant changes in the amount of goodwill]:
There are no applicable matters to be reported.

8

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2020

II Three months ended July 31, 2019 (May 1, 2019 to July 31, 2019)
1. Net sales and income (loss) by reportable segment
Reportable segments
Adjustments(Note) 1(Million yen)
Carried onquarterly
consolidated
statements ofincome(Note) 2

Dispensing
pharmacybusiness

Cosmetic anddrug store
business

Otherbusinesses(1) Sales to third parties

64,800

6,560

1,100

72,461－

72,461(2) Intersegment sales

－

－

28

28

(28)

－

Total sales

64,800

6,560

1,129

72,490(28)

72,461

Segment income (loss)

4,804

230

(51)

4,982

(770)

4,212

Total

Sales

Notes:

1. The adjustment of ¥(770) million to segment income (loss) includes ¥1,346 million in corporate expenses, ¥(599)
million in (income) loss that is not allocated to reportable segments, and ¥24 million in eliminations due tointersegment transactions.
Overall group expenses consist mainly of expenses associated with the administrative departments of the parent
company, such as general affairs and accounting departments.
2. Segment income (loss) is adjusted with the ordinary income of quarterly consolidated statements of income.

2. Impairment losses on fixed assets and goodwill by reportable segment[Significant impairment losses on fixed assets]:
There are no applicable matters to be reported.
[Significant changes in the amount of goodwill]:
There are no applicable matters to be reported.

9