Summary of Business Results for the Second Quarter Ended September 30, 2019
[Japan GAAP] (Consolidated)
November 14, 2019

Company
Listed on the TSE
Akatsuki Corp.
Stock Code8737
URL: http://www.akatsuki-fg.com/
Representative
Hideaki Shimane, President and Representative Director
Contact
Masahiro Kitano, Executive Officer, Head of President office
T E L: +81-3-6821-0606
Expected date of filing of quarterly report: November 14, 2019
Expected starting date of dividend payment: December 9, 2019
Preparation of quarterly supplementary financial document: None
Quarterly results briefing: None
（Rounded down to million yen）

１. Consolidated business results for the six months ended September 2019
(April 1, 2019 through September 30, 2019)(1) Consolidated results of operations
Operating revenues
Million yen%(% change from the previous corresponding period)
Net operating
revenues

Operating income

Million yen%

Million yen%

Six months ended
15,985
4.7
4,737
2.2
604
72.2
Sep. 2019
Six months ended
15,270
61.7
4,633
10.4
351
-68.4
Sep. 2018(Note) Comprehensive income:Year ended September 2019: 253 million yen (535.4%)
Year ended September 2018: 39 million yen (-94.4%)
Net income
Diluted net income perper share
share
Yen
Yen
Six months ended Sep. 2019
7.16
7.03
Six months ended Sep. 2018
6.18
5.73

Net income attributable toowners of parent

Ordinary income
Million yen%

Million yen

%

320

74.2

216

55.1

184

-86.7

139

-87.5

(2) Consolidated financial position
Total assets

Net assets

Million yen
As of Sep. 201958,394As of Mar. 201954,544(Reference) Shareholders’ equity:
As of September 2019: 12,419 million yen
As of September 2018: 12,320 million yen

Million yen
12,495
12,400Shareholders’ equity
ratio

Net assets per
share

%
21.3
22.6

Yen
405.80409.32

2. Dividends
Annual dividend
End of 1Q

Yen――

End of 2Q

End of 3Q

Yen
10.00
9.00

Year ended Mar. 2019Year ending Mar. 2020
Year ending Mar. 2020
(forecast)(Note) Revisions to dividend forecast for the current quarter: None
Dividend forecasts for the fiscal year ending March 2020 is currently 9 yen per share.

Year-end

Yen
―
―

Total

Yen
8.00
9.00

Yen
18.00
18.00

3．Forecast of consolidated business results for the fiscal year ending March 2020
(April 1, 2019 through March 31, 2020)
Net sales(% change from the previous corresponding period)
Operating income

Million yen% Million yen
Year ending Mar. 2020
36,0000.7
2,200(Note) Revisions to business forecast for the current quarter: None

%
21.8

－1－

Ordinary income

Net income attributableto owners of parent

Million yen
1,700Million yen
1,200

%
25.4

%
16.4

※Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries accompanying changes
in the scope of consolidation): None
(2) Application of accounting procedures specific to preparation of the consolidated quarterly financial statements:
None(3) Changes in accounting policies, accounting estimates and restatement①Changes in accounting policies associated with revision of accounting standards:②Changes in accounting policies other than ①③Changes in accounting estimates④Restatement: None: None: None: None(4) Shares outstanding (common stock)①Number of shares outstanding at the end of period (treasury stock included)
As of September 2019
32,688,944 shares
As of March 201932,274,144 shares②Treasury stock at the end of period
As of September 2019
2,083,512 shares
As of March 20192,174,141 shares③Average number of stock during period (quarterly cumulative period)
Six months ended September 201930,304,072 shares
Six months ended September 2018
22,646,289 shares(Note) The number of treasury stock which is deducted for calculating the number of treasury stock during period and the average
number of shares during the period includes the shares of the Company owned by the ESOP Trust Account and the BBT Trust
Account.

*Quarterly financial summary is not subject to the quarterly review procedures by certified public accountants
or auditing firms.
*Explanation regarding appropriate use of business forecasts and other special instructions
Forecasts regarding future performance in this material are based on information currently available to the company
and certain assumptions that the company deems to be reasonable at the time this report was prepared. Actual results
may differ significantly from the forecasts due to various factors.
This document is an English translation of a Japanese announcement made on the date above. Although we intended tofaithfully translate the Japanese document into English, the accuracy and corrections of this English translation is notguaranteed and thus you are encouraged to refer to the original Japanese document.

－2－

1. Qualitative Information on Quarterly Financial Results(1) Results of Operations
During the six months ended September 2019 (April 1, 2019 to September 30, 2019), our group has engaged in thefollowing initiatives.
In the securities-related business, while brokerage commissions of Akatsuki Securities,Inc. declined due to weakdomestic stock markets, operating revenue and operating income increased from the previous fiscal year. This was
attributable to an increase in trading revenue from the sale of structured bonds and substantial increase in the revenue of
IFA segment due to an increase in the number of contracted intermediaries and the balance of assets under management
as a result of strengthening of the IFA business. We are also promoting alliances with regional financial institutions to
expand our sales channels.
As a result, the performances of the securities-related business were as follows.
(Operating revenue and segment profit in the securities-related business)(Million yen)Six months ended

Six months ended

September 2018

September 2019

Operating revenues
Segment profit

Rate of change

1,892

2,281

20.5%

144

192

33.0%

In the real estate-related business, purchases of vacant properties and properties with lessees in the Total Estate Groupremained firm. Profits declined slightly compared with the previous fiscal year as a result of efforts to reduce inventories
of vacant properties in particular. We are promoting to establish and operate purchasing and settlement standards,
strengthen inventory risk management, and strengthen our financial base, that accurately reflect changes in the realestate market and financial conditions.
In April of this year, EW Asset Management Co., Ltd. purchased the land of Kamikoto-en, Nishinomiya City, Hyogo
Prefecture, and launched the development of a residential-type private pay nursing home. This facility has alreadyentered into long-term lease agreements with a blue-chip nursing care provider,and we expect stable earnings after the completion of construction and commencement of operation in June 2021.
(Operating revenue and segment profit in the real estate related business)(Million yen)Six months ended

Six months ended

September 2018

September 2019

Operating revenues

Rate of change

13,552

13,844

2.2%

870

854

-1.8%

Segment profit

As a result, the performances of our Group for the six months ended 2019 were as follows.
(Million yen)Six months ended

Six months ended

September 2018

September 2019

Rate of change

Operating revenues

15,27015,985

4.7%

Operating income

351

604

72.2%

Ordinary income

184

320

74.2%

Net income attributable toowners of parent

139

216

55.1%

－3－

The non-consolidated performances of Total Estate Co., Ltd. are disclosed in the following supplementary information as
they have a particularly significant impact on our consolidated results.
(Supplementary Information)
Total Estate Co., Ltd. operates existing condominium business in the Tokyo metropolitan area, primarily in Tokyoand Kanagawa Prefecture, targeting primary buyers of residential properties, which consists of ① a case in which atenant-less vacant condominium is purchased and immediately renovated and sold (hereinafter referred to as "Type A")
and ② a case in which an existing condominium with tenant is purchased rental income for a certain period, renovates
it after the tenant vacates, and sells it (hereinafter referred to as "Type B").
(a) Business results of Total Estate, Inc. (Quarterly basis)(Million yen)
FY3/19

Sales
Ordinary
incomeNet income

FY3/201Q(Apr.-Jun.)

2Q(Jul.-Sep.)

3Q(Oct.-Dec.)

4Q(Jan.-Mar.)

1Q(Apr.-Jun.)

2Q(Jul.-Sep.)

3Q(Oct.-Dec.)

4Q(Jan.-Mar.)

5,777

6,797

7,282

7,545

6,362

6,523

-

-

334

385

610

465

310

421

-

-

336

261

421

326

207

290

-

-

(b) Number of units purchased (Quarterly basis. Figures in parenthesis represent YoY changes)(Units)FY3/19Type A
Type B
Total

1Q(Apr.-Jun.)
159
(+3)
46
(+17)
205
(+20)

2Q
(Jul.-Sep.)
147
(-14)
50
(-2)
197
(-16)

FY3/203Q(Oct.-Dec.)
139
(-27)
54
(-51)
193
(-78)

4Q
(Jan.-Mar.)
130
(-45)
90
(+39)
220
(-6)

1Q
(Apr.-Jun.)
125
(-34)
62
(+16)
187
(-18)

2Q
(Jul.-Sep.)
167
(+20)
75
(+25)
242
(+45)

3Q
(Oct.-Dec.)-

4Q(Jan.-Mar.)

-

-

-

-

-

(c) Number of units sold (Quarterly basis. Figures in parenthesis represent YoY changes)(Units)FY3/19FY3/201Q(Apr.-Jun.)

2Q(Jul.-Sep.)

3Q(Oct.-Dec.)

4Q(Jan.-Mar.)

1Q(Apr.-Jun.)

2Q(Jul.-Sep.)

3Q(Oct.-Dec.)

4Q(Jan.-Mar.)

Number of

162

170

176

216

189

172

-

-

units sold

(+48)

(-)

(+39)

(+69)

(+27)

(+2)

(b) Inventories (At the end of each quarter)(Units)FY3/19FY3/201Q(Apr.-Jun.)

2Q(Jul.-Sep.)

3Q(Oct.-Dec.)

4Q(Jan.-Mar.)

1Q(Apr.-Jun.)

2Q(Jul.-Sep.)

3Q(Oct.-Dec.)

4Q(Jan.-Mar.)

Type A

426

418

398

335

292

322

-

-

Type B

416

451

488

555

590

630

-

-

Total

842

869

886

890

882

952

-

-

－4－

(2) Financial Position
AssetsTotal assets at the end of the six months ended September 2019 increased 3,850 million yen from the end of theprevious fiscal year to 58,394 million yen. This was mainly due to increases of 1,838 million yen in cash and deposits
and 1,815 million yen in real estate for sale.
Liabilities
Liabilities increased 3,754 million yen from the end of the previous fiscal year to 45,898 million yen. This was mainly
due to increases of 2,287 million yen in deposits received and 1,476 million yen in long-term loans payable.
Net assets
Net assets increased 95 million yen from the end of the previous fiscal year to 12,495 million yen.
(3) Cash Flow Situations
Cash and cash equivalents (hereinafter, “cash”) for the six months ended September 2019 increased 2,012 million yen
compared with the previous fiscal year to 12,942 million yen.
Cash flows from operating activities
Net cash provided by operating activities was 1,507 million yen (compared with net cash earned of 562 million yen in
the same period of the previous fiscal year). This was mainly due to the recording of 256 million yen in quarterly net
income before income taxes and minority interests and an increase of 2,289 million yen in advances and deposits
received, despite a decrease in cash flow mainly due to the recording of 1,516 million yen in real estate for sale.
Cash flows from investing activities
Net cash used in investing activities was 261 million yen (compared with net cash used of 246 million yen in the same
period of the previous fiscal year). This was mainly due to the recording of 362 million yen in payments for purchase ofinvestment securities.
Cash flows from financing activities
Net cash provided by financing activities was 767 million yen (compared with 5,135 million yen provided in the same
period of the previous fiscal year). This was mainly due to recording of proceeds from borrowings of 10,383 million yen
and proceeds from issuance of bonds of 2,993 million yen, while repayment of borrowings of 9,622 million yen andredemption of bonds of 3 thousand million yen were recorded.
(4) Comment on forecast information including consolidated earnings forecasts
There are no changes to the full-year consolidated earnings forecasts announced in the "Consolidated Financial Results
for the Fiscal Year Ended March 31, 2019" announced on May 15, 2019.

－5－

(Thousands of yen)
As of March 31, 2019
AssetsCurrent assets
Cash and deposits
Cash segregated as deposits
Trading products
Margin transaction assets
Loans on margin transactions
Cash collateral pledged for
securities borrowing on margintransactions
Guarantee deposits
Real estate for sale
Other
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Land
Other
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets－6－

As of September 30, 201912,747,964
5,200,000
1,065,002
3,099,351
2,598,320

14,586,324
5,800,000
851,7442,753,844
2,183,030

501,031570,814270,001
25,241,007
1,064,066
48,687,393

350,008
27,056,667
1,096,388
52,494,978

1,610,789
831,948
130,0622,572,800

1,360,109
798,660
134,052
2,292,822

2,005,589
148,876
2,154,465

1,893,067
245,708
2,138,776

404,061
906,323△180,435
1,129,949
5,857,216
54,544,609

730,118
933,032△194,925
1,468,225
5,899,825
58,394,803

(Thousands of yen)
As of March 31, 2019
Liabilities
Current liabilities
Trading products
Trade date accrual
Margin transaction liabilities
Borrowings on margin transactions
Cash received for securities lendingon margin transactions
Deposits received
Guarantee deposits received
Short-term bonds payable
Short-term borrowings
Current portion of long-term borrowings
Current portion of long-term nonrecourse loans payable
Income taxes payable
Other
Total current liabilities
Non-current liabilities
Bonds payableNon-recourse Bond
Long-term borrowings
Non-recourse Long-term loans payable
Retirement benefit liability
Provision for share-based remuneration
for directors (and other officers)
Other
Total non-current liabilities
Reserves under special laws
Reserve for financial instruments
transaction liabilities
Total reserves under special laws
Total liabilities
Net assets
Shareholders' equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-forsale securities
Foreign currency translation adjustment
Total accumulated other comprehensive
incomeShare acquisition rights
Non-controlling interests
Total net assets
Total liabilities and net assets－7－

As of September 30, 2019

41,582
847,029
903,439
667,082

23,382499,6021,210,798
614,125

236,357

596,673

4,504,359
325,7444,000,000
11,195,197
1,001,609

6,791,867
547,977
5,000,000
10,178,777
1,302,336

60,320703,220

154,919
1,468,264
24,502,465

174,227
1,715,298
28,147,487

4,000,000
99,0009,513,844
2,626,840
227,843

3,000,000
99,00010,990,126
2,188,780
238,847

659,365

711,545493,729
17,620,623

501,775
17,730,074

21,43521,43521,43542,144,524

21,43545,898,997

5,492,516
3,141,209
4,553,464△835,092
12,352,098

5,530,883
3,172,678
4,512,325△800,830
12,415,057△37,275

267

5,698

4,437

△31,577

4,704

21,03458,52912,400,085
54,544,609

17,11058,933
12,495,806
58,394,803

(Thousands of yen)Six months ended
September 30, 2018
Operating revenue
Commission received
Net trading income
Financial revenue
Sales in real estate business
Other
Total operating revenue
Financial expenses
Cost of sales
Cost of sales in real estate businessTotal cost of sales
Net operating revenue
Selling, general and administrative expenses
Trading related expenses
Personnel expenses
Real estate expenses
Office cost
Depreciation
Taxes and dues
Sales commission
Amortization of goodwill
Other
Total selling, general and administrative
expenses
Operating profit
Non-operating income
Gain on sales of investment securities
Foreign exchange gains
Penalty income
Real estate acquisition tax refund
Other
Total non-operating income
Non-operating expenses
Interest expenses
Commission expenses
Other
Total non-operating expenses
Ordinary profit－8－

Six months ended
September 30, 2019814,635
842,937
47,363
13,547,356
18,687
15,270,980
8,648

659,976
1,431,870
35,435
13,843,986
14,03915,985,309
9,302

10,628,686
10,628,686
4,633,645

11,238,322
11,238,322
4,737,684

259,797
1,742,931
192,191
242,01286,650382,095
463,885
104,224
808,845

550,452
1,758,642
190,735
248,161
80,443
237,089
344,476
112,521610,763

4,282,635

4,133,287

351,010604,396－
47,07345,754
11,06931,914
135,811

2,985－－
34,77730,50968,272

240,829
40,30921,482
302,621
184,200

242,733
56,61852,506
351,858
320,811(Thousands of yen)Six months ended
September 30, 2018
Extraordinary income
Gain on sales of non-current assets
Other
Total extraordinary income
Extraordinary losses
Loss on liquidation of subsidiaries andassociates
Loss on valuation of investment
securities
Loss on retirement of non-current assets
Other
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit (loss) attributable to noncontrolling interests
Profit attributable to owners of parent－9－

Six months ended
September 30, 2019

176,408
7,191
183,600

3,508
－
3,508

7,874

－

－

52,8190－7,874
359,926
207,596
16,940224,537
135,389

14,101
1,129
68,050256,270
283,768△244,873
38,894
217,375△4,486403

139,875

216,971(Thousands of yen)Six months ended
September 30, 2018
ProfitOther comprehensive income
Valuation difference on available-forsale securities
Share of other comprehensive income ofentities accounted for using equity
methodTotal other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable toowners of parent
Comprehensive income attributable to noncontrolling interests－ 10 －

Six months ended
September 30, 2019

135,389

217,375△96,315

37,543848△1,261△95,466
39,92236,282
253,657

44,409253,253△4,486403

(Thousands of yen)Six months ended
September 30, 2018
Cash flows from operating activities
Profit before income taxes
Depreciation
Amortization of goodwill
Increase (decrease) in provision forbonuses
Increase (decrease) in provision forshare-based remuneration for directors(and other officers)
Increase (decrease) in retirement benefit
liability
Interest and dividend income
Interest expenses
Loss (gain) on sales of property, plantand equipment
Decrease (increase) in real estate forsale
Decrease (increase) in trading products assets (liabilities)
Decrease (increase) in trade dateaccruals
Decrease (increase) in cash segregated as
deposits
Decrease/increase in assets/liabilities
for margin transaction
Decrease/increase in advancepaid/deposits received
Other, net
SubtotalInterest and dividends received
Interest paid
Income taxes (paid) refund
Net cash provided by (used in) operating
activities－ 11 －

Six months ended
September 30, 2019359,926
207,012104,224

256,270
142,771
112,521△7,02043,370128,620

60,139△1,287

11,003△5,456
241,006△3,619242,733△176,408△2,379△1,697,343△1,516,382

882,385

195,058△572,870△347,427

700,000△600,000

494,526

652,865

96,3982,289,504

631,724
1,385,438
17,503△220,836△619,973

515,047
2,051,477
3,536△261,590△285,994

562,1311,507,429

(Thousands of yen)Six months ended
September 30, 2018
Cash flows from investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of property, plant and equipment
Proceeds from sales of property, plantand equipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from sales of investment
securities
Purchase of shares of subsidiaries
resulting in change in scope of
consolidation
Loan advances
Collection of loans receivable
Other, net
Net cash provided by (used in) investing
activities
Cash flows from financing activities
Proceeds from borrowings
Repayments of borrowings
Proceeds from long-term non recourse
loans payable
Repayment of long-term non recourse loans
payableProceeds from issuance of bonds
Redemption of bonds
Proceeds from issuance of shares
Proceeds from payment of new stock
application margin
Purchase of treasury shares
Dividends paid
Other, net
Net cash provided by (used in) financing
activities
Effect of exchange rate change on cash andcash equivalents
Net increase (decrease) in cash and cash
equivalents
Cash and cash equivalents at beginning of
periodCash and cash equivalents at end of period－ 12 －

Six months ended
September 30, 2019

△55,000
10,006△779,895△10,000
160,009△91,298

649,556

8,983△2,690△50,000△5,727△362,192

2,049

12,610△3,744－△38,804
21,934209△4,152
11,611
18,180△246,379△261,976

12,669,044△10,093,922

9,570,210△8,809,622

550,000

235,000△60,110△30,160

4,990,150△4,000,000
1,425,881

2,993,815△3,000,000
72,810101,991－△203,797△229,674△14,556△221△258,110△6,536

5,135,004

767,185

47,073

5

5,497,830

2,012,643

6,567,542

10,929,866

12,065,372

12,942,510