The 10th Business TermBusiness Report
From April 1, 2015
to March 31, 2016

I. Business Report
II. Balance Sheet
III. Income Statement
IV. Statement of Changes in Net Assets
V. Notes to Non-consolidated Financial Statements※

This document has been translated from the Japanese original,for reference purposes only.
If there is any discrepancy between this translated document and the Japanese original,
the original shall prevail.

Tokyo International Air Terminal Corporation

Business Report
From April 1, 2015
to March 31, 2016

1. Matters Concerning the Company’s Status(1) Progress and Results of Operations
During the fiscal year under review, the Japanese economy continued on a gradual
recovery track in general, despite some weakness, as consumer spending remained
steady partly due to the impact of the various policies of the government. While there
were some disruptions in the financial market after 2016 started, the stock prices
also started looking up from March and the markets have been regaining somecalmness.
Overseas, though lacking in strength, the U.S. economy registered a gradual
recovery led by consumption. The European economy also was gradually picking up
albeit at a slower pace compared with other developed countries. By contrast, thoughbusiness confidence continued to worsen in parts of Asia such as China and otheremerging countries, the demand for inbound travel to Japan continued to be highthroughout the year buoyed by the prolonged depreciation of the yen and thesignificant easing of visa regulations.
Under such circumstances, Haneda Airport added 12 international routes during
day time between Japan and China from the winter schedule as an outcome ofnegotiations after resumption of the Japan-China air talks. Moreover, flights toAustralia were started newly in the late night and early morning time slots fromsummer and a number of LCC flights also started service, enhancing routes to China
and Taiwan.
As a result, both outbound and inbound passenger count in the fiscal year underreview grew strongly by about 1.2 times compared with the previous fiscal year. The
number of passengers per day marked a record in the summer peak season and it
renewed the records one after another during the year-end and New Year holidays
and Chinese New Year and at the fiscal year end.
Against this backdrop, as safety and security forms the basis of an international
passenger terminal, the Company established a special structure from the disasterprevention and security aspect and enhanced security especially during the peaktimes such as Golden Week, summer vacation, Silver Week in autumn and year-end
and New Year holidays in response to the increasing number of passengers. Further,
given the recent terrorist incidents, the Company enhanced the number of security
personnel and facilities from the perspective of strengthening precautions against
terror attacks, reinforced patrolling and collected and offered information‐1‐

appropriately as part of efforts to ensure safety of the customers.
In the fiscal year under review, the Company carried out a total of 15 drills on theassumption that a disaster has occurred in an area near the workplace of theemployees in the terminal as part of a comprehensive disaster preparedness drill
implemented throughout the entire International Passenger Terminal district. In
addition, the Company separately held a drill to start up an emergency headquarters
in a crisis management level 3 situation assuming an earthquake measuring lower 6
or above on the Japanese scale to improve disaster prevention and safety awarenessat the airport.
In November and December, the Company cooperated in the operation assessment
test of the advanced body scanner by collaborating with the Airline Operators’Committee as part of an initiative to upgrade the security check at airports promotedby the Japanese government as an anti-terrorism measure, in preparation for the
full-scale introduction of the device in fiscal year 2016.
As for facilities, the Company continued to improve the various facilities in theterminal to improve convenience and comfort of customers.
In the departure lobby on the third floor of the terminal, it started a luggage
wrapping service and installed a luggage weighing scale for use by customers. It also
added pole-type charging facilities at 198 locations with lobby chairs in the security
area offering charging facilities for the various electronic devices used by customers.
In addition, it ingeniously installed relax chairs with partitions, so that customers
can relax for a long period of time in the terminal.
Moreover, as for mailbox, for which there were many requests from customers, theCompany installed a Haneda version mailbox near the center of the departure lobby
on the third floor with the cooperation of Japan Post Co., Ltd. and it has been
received well by the customers.
The Company added a total of 25 access points for free wireless LAN in duty freestores and restaurants to improve the environment for using the service atcommercial outlets.
In terms of passenger service, the Company installed manned information counterat two locations in the departure concourse on the third floor in the security area andshifted the information counter in the arrival lobby on the second floor to the center of
the access hall to improve customer convenience.
Further, a council was established during the fiscal year under review on the latenight and early morning bus service that started as a demonstration experiment by
the Japanese government in the previous fiscal year, and the Company has been
participating in the experiment as a main member. As a result of additions in October
2015, there are 17 airport access bus services, operated on a total of seven routes and‐2‐they have become an important means of accessing the airport for customers duringlate night and early morning.
In order to maintain and improve the service quality, the Company conducted roleplaying contests and training in conversation with customers in English, Chinese andKorean on a regular basis targeting employees of the retail stores and service
facilities in the terminal. In addition, it has been continuing with implementation of
overall questionnaire surveys and anonymous investigations throughout theterminal.
As for entertainment offered to the customers, the Company decorated the building
to project Japan’s four seasons including winter illumination and carried out various
campaigns. Among these campaigns, the Company held the Haneda Edo Matsuri
event, which has established itself as an attraction offered by the Company, where
people can get a feel of the Edo period, during the Golden Week, summer vacation
and New Year holidays respectively in elaborate ways for each season andcontributed significantly to increase the number of visitors to the terminal.
At TIAT Duty Free Shops, the Company increased the number of cashiers to avoid
keeping customers waiting and reviewed merchandise layout.
The shops introduced security tamper evident bags, or STEBs, to improve theconvenience of customers who transit at overseas airports and started offering liquid
products such as liquor.
Moreover, in time with the opening of Japan’s first airport-type duty free shop in
Ginza downtown district, the Company set up a counter in the departure area of theterminal for customers to receive duty free products they purchased downtown toplay a role in offering a new option to purchase duty free products not only to foreign
travelers but also to Japanese travelers flying to overseas destinations.
At the general shops in the lobby areas, the Company further enhanced the lineupof hot-selling products in response to the enhanced consumption tax free systemtargeting foreign travelers from April 2015.
With respect to universal design, amid intensifying interest in Tokyo Olympic andParalympic Games in 2020, the Company embarked on further improvement at its
facilities based on the verification and assessment result following the spiral-up
carried out in the previous fiscal year. In addition, it has been implementing ademonstration experiment of terminal guide using projection mapping, as well as
optical ID that can be conveniently used in customer mobile terminals, and beacon,
etc. with the cooperation of manufacturers to enhance the guiding function of theterminal by actively utilizing information and communications technology, or ICT.
The Company plans to actually install it one after another in the terminal.
The Company plans to install several tablet terminals on the back side of the‐3‐

information counter which has been moved to the center of the arrival lobby on thesecond floor to allow customers to operate them on their own and search the facilities
and services in the terminal and offer services combining introduction of arrival
traffic line in video and the optical ID function.
Moreover, the Company started a service to display translation of guidance using
QR code at Haneda Nihonbashi, Festival Plaza and TIAT Sky Road as part ofmultilingual initiatives and utilizing the service in explaining exhibits to foreign
tourists.
It is of great importance for the staff working at the International Passenger
Terminal to share the CS philosophy and accumulate improvements throughcontinuous implementation of CS activities to continue offering high quality services
and hospitality to customers. To this extent, the Company again this year plannedand operated the CS award system, held CS seminars and campaigns and issued CS
information magazine at the Haneda Airport International Area Passenger CS
Liaison Committee while enhancing its activities within the International Area as awhole. In addition, the Company increased the number of TIAT Communication
Board installed in the previous fiscal year on the staff passageways to seven in total.
It is utilizing the boards to disseminate information regarding the Company’s various
activities and information to the staff members working in the terminal and invite
participants of events to promote their understanding of the Company’s business
together with so-called internal branding activities and lead to improvement of CS
throughout the terminal.
As a result of these various efforts, the terminal along with the Domestic Passenger
Terminal won the 5 Star Airport in the Global Airport Ranking by Skytrax for thesecond consecutive year. Further, it regained the World’s Cleanest Airport tag at theend of the fiscal year, winning it for the third time.
It also won the Japan Toilet Award by the Minister of Land, Infrastructure,
Transport and Tourism in the commendation system sponsored by the Cabinet
Secretariat, and was also acclaimed for the planning, development and maintenanceand operation of its toilet space.
As described above, as a result of the Company’s implementation of measures toimprove various services for customers, firm daily operation of the terminal andbusiness execution with cost awareness combined with the increased customers
reflecting the rise in the number of flights, the Company reported operating revenueof 70,819 million yen (up 23.5% compared with the previous fiscal year) in the fiscal
year under review, operating income of 8,822 million yen (up 38.4%), and ordinary
income of 4,639 million yen (up 101.2%). Net income came to 4,316 million yen (up47.6%) achieving single fiscal year profit following the previous fiscal year.

‐4‐Business performance by Division is as follows.
(Facilities Management Division)
At the International Passenger Terminal, passenger service facility charge, or
PSFC, income which the Company receives from air travelers at departure andtransit came to 15,627 million yen (up 17.1% compared with the previous fiscal year)
due to the increased number of customers reflecting added flights.
Facility usage fee income from air transport service operators’ use of facilities
including boarding bridges, luggage handling system and gates dedicated forbusiness jet airplanes totaled 3,428 million yen (up 9.1%).
Rent income from renting offices for airlines and shop spaces for tenants came to4,520 million yen (up 7.5%).
As a result operating revenue of the Facilities Management Division was 23,576
million yen (up 13.9%).
(Direct Management Operations Division)
In the Merchandise Sales Division, sales of merchandise at TIAT Duty Free Shops
and boutiques by fashion brands came to 42,227 million yen (up 30.5%) as the sales
were strong during the period, registering record monthly sales since the opening of
the terminal.
In the Food and Beverage Division, sales totaled 1,899 million yen (up 30.3%) due
to the increased number of customers.
In addition, parking lot income was 1,459 million yen (up 0.4%) in line with theprevious fiscal year, and other income including that from placing advertisements inlounges and the terminal totaled 1,656 million yen (up 19.8%).
As a result, operating revenue of the Direct Management Operations Division cameto 47,242 million yen (up 28.9%).

(2) Status of Capital Investment
During the fiscal year under review, the Company made a capital investment of
2,551 million yen in total, which included 661 million yen for upgrade of theInternational Passenger Terminal building system equipment, 200 million yen forrepair work of TIAT Duty Free Shop Central and 475 million yen for constructing acounter for handing over products purchased at a downtown duty free shop.

(3) Status of Fund Procurement
The loan of funds for expansion works of the International Passenger Terminal,
etc. under the Limited Loan Contract Alteration Contract signed with the lenders asof March 21, 2012 has been completed in fiscal year 2014. In the fiscal year underreview, the Company repaid 3,119 million yen on September 30, 2015 and 5,433
million yen on March 31, 2016. As a result, the balance of loans from the lenders
stood at 101,645 million yen as of the end of the fiscal year under review.
‐5‐(4) Issues to Be Addressed
The demand from foreign tourists planning to visit Japan is expected to increasereflecting the Japanese government’s tourism-oriented strategy moving towards theTokyo Olympic and Paralympic Games in 2020. As the discussion for further
increasing the arrival and departure slots at Haneda Airport based on thegovernment policy to strengthen the function of the airports in the Tokyo
metropolitan area progresses, the Company’s mission as a passenger flight terminal
operator, and based on ensuring customer safety and security, is to enhance thealertness and security against possible terror attacks and take every possible step toprepare against earthquake and other disasters. Based on this premise, it is for theCompany to continue with improvement of facilities for better convenience andcomfort using its integrity even with limited resources, and it becomes important for
the Company to steadily accumulate realization of such various measures for theforeseeable future.
To this extent, the Company believes it is integral to promptly share information
not only with organizations concerned such as the government and lenders but alsowith business partners and shareholders and have meticulous and sufficient
discussions and coordination.
The Company recognizes that it is an important task to introduce information
universal design utilizing ICT as an advanced service ahead of other majorinternational air terminals around the world after evaluating and analyzing in detailthe outcome of the related demonstration experiment carried out in the fiscal year
under review and making improvements so as to further increase the value of theHaneda Airport.
The Company fully recognizes Haneda Airport’s role and significance as aninternational airport in the Tokyo metropolitan area, and it will continue to offer
facilities and services of outstanding quality (safety, convenience and comfort) as it
relentlessly makes efforts in daily operation and maintenance management andsteadily addresses customers’ voices and the outcome of questionnaire surveys andmatters pointed out by Skytrax.

‐6‐

(5) Changes in Assets and Income
Category

The 7th term
FY2012The 8th term
FY2013The 9th term
FY2014

The 10th term
FY201531,93435,84457,35770,819（1,812)(2,217)

2,924

4,316

（577,937)（627,043)

824,014

1,186,638

1,465

400

2,833

6,348

Operating revenue( million yen)
Net income (loss)( million yen)
Net income (loss)
per share（yen）
Net assets( million yen)(6) Status of Employees
Number of employees: 56(up 5 persons compared with the end of the previous
fiscal year)(7) Main Business
1) Management and operation of the international passenger terminal building2) Leasing of offices and shop spaces for air transport service operators and businesses
operating in the premises of the airport
3) Provision of various services including guiding the users of the international
passenger terminal building, operation of lounges and rental meeting rooms andoperation of parking lots4) Sales of merchandise to the users of the international passenger terminal building5) Operation of restaurants and coffee shops for the users of the international
passenger terminal building.

(8) Main Lenders( million yen)

Lenders

AmountDevelopment Bank of Japan Inc.

23,311

Mizuho Bank, Ltd.

15,554The Bank of Tokyo-Mitsubishi UFJ, Ltd.

12,758

Sumitomo Mitsui Banking Corporation

6,360

The Bank of Yokohama, Ltd.

6,069

Shinkin Central Bank

5,973

‐7‐

2. Matters Regarding the Company’s Shares(1) Total Number of Shares Outstanding: 3,600 shares(2) Number of Shareholders: 13(3) Shareholders

Name of shareholder

Number ofsharesJapan Airport Terminal Co., Ltd.

1,396

Japan Airlines Co., Ltd.

697

ANA Holdings Inc.

697

Narita International Airport
Corporation

162

Tokyo Electric Power Company, Inc.

126

Secom Co., Ltd.

108

Tokyo Gas Co., Ltd.

108

Keikyu Corporation

72

Tokyo Monorail Co., Ltd.

72

NTT Data Corporation

54

Development Bank of Japan Inc.

36

Mizuho Bank, Ltd.

36

The Bank of Tokyo-Mitsubishi UFJ,
Ltd.
Total

36
3,600

Note: The shares in the Company held by Tokyo Electric Power Company, Inc. have been
inherited by TEPCO Energy Partner, Incorporated due to the company split thattook effect on April 1, 2016.

(4) Other Important Matters Regarding the Shares
Of the Company’s outstanding shares of 3,600 shares, the 36 shares each held byDevelopment Bank of Japan Inc., Mizuho Bank, Ltd., and The Bank ofTokyo-Mitsubishi UFJ, Ltd. are preferred shares with preference dividend payments.

‐8‐3. Matters Regarding Company Executives(1) Name, etc. of Directors and Auditors
Name

Title and areas in charge

Status of representing
other corporate entity

Katsuji Doi
Shigeyuki Taguchi

President & CEO (Representative Director)
Managing Director (Customer Services
Department, Security and Disaster Prevention
Department)

Shin Suzawa

Managing Director (General Administration
Department, Corporate Planning Department)

Junichiro Kitamura

Managing Director (Finance Department)

Takahiro Uehara

Managing Director (Facilities Department,
Sales and Marketing Department, International
Affairs Department)

Masaki Saida

External Director

Senior Executive Vice President,
Narita International Airport
Corporation

Tomoaki Kobayakawa

External Director

Managing Executive Officer, Tokyo
Electric Power Company, Inc.

Masakazu Owashi

Corporate Auditor

Fumiya Akai

External Corporate Auditor

Makoto Sugimachi

External Corporate Auditor

Managing Executive Officer, Tokio
Marine & Nichido Fire InsuranceCo., Ltd.

Note 1. Directors Masaki Saida and Tomoaki Kobayakawa are external directors
stipulated by Article 2-15 of Companies Act.
Tomoaki Kobayakawa retired as Managing Executive Officer of Tokyo
Electric Power Company, Inc. as of March 31, 2016 and assumed the position
of Representative Director and President of TEPCO Energy Partner,
Incorporated as of April 1, 2016.
2.

All of the three corporate auditors are external auditors stipulated by Article
2-16 of Companies Act.
Makoto Sugimachi assumed the position of Senior Managing Executive
Officer of Tokio Marine & Nichido Fire Insurance Co., Ltd. as of April 1, 2016.

‐9‐

3.

Corporate Auditor Masakazu Owashi is a certified public accountant and has
considerable knowledge regarding finance and accounting.

4.

Corporate auditor Fumiya Akai, as a lawyer is well-versed in corporate law
and has considerable knowledge regarding finance and accounting.

5.

Kenichi Fukaya resigned as director at the close of the Extraordinary
Shareholders Meeting held on August 5, 2015, while Masaki Saida wasnewly appointed as a director in the same meeting and took charge.

(2) Amount of Compensation, etc. for Directors and Auditors for the Fiscal Year under
Review
12 directors
3 auditors

138
million yen
18
million yen(of which, 4 external directors

8 million yen)(of which, 3 external auditors

18 million yen)

Note: The amount of compensation, etc. for the directors includes the retirement bonuses paid
to directors who retired at the close of the 9th General Shareholders Meeting and theExtraordinary Shareholders Meeting held on August 5, 2015.

(3) Matters Regarding External Officers
1. Director
Masaki Saida and Tomoaki Kobayakawa attend the board of directors meeting
held every month and offer appropriate remarks such as necessary opinions andquestions covering the overall management.
2. Auditor
Masakazu Owashi, Fumiya Akai and Makoto Sugimachi offer appropriate
counseling and suggestions from the standpoint of ensuring legal compliance andfairness at the monthly board of directors meeting and the board of auditors
meeting held as necessary.

4. Accounting Auditor(1) Name of the Accounting Auditor
Ernst & Young ShinNihon LLC(2) The Amount of Compensation, etc. for the Accounting Auditor for the Fiscal Yearunder Review
Audit and attestation services compensation in the Certified Public Accountants
Act Article 2 Paragraph 1:

11 million yen‐10‐(3) Reasons for the Board of Auditors Consent to the Compensation, etc. of the
Accounting Auditor
The Company’s board of auditors, after considering the accounting auditor’s
audit plan details, the status of the accounting auditing job execution and thegrounds for the quoted compensation calculation, consents under Paragraph 1,
Article 399 of the Companies Act, to the amount of compensation, etc. for theaccounting auditor.

(4) Policy on Dismissal or Refusal of Reappointment of the Accounting Auditor
The Company’s board of auditors may, in accordance with various items of
Paragraph 1, Article 340 of the Companies Act, dismiss the accounting auditor,
and if appropriate auditing is deemed as difficult due to the occurrence of reasonsthat hinder the competence and independence of the accounting auditor, shallsubmit a proposal for dismissing or refusing the reappointment of the accounting
auditor to the General Meeting of Shareholders based on a resolution of theboard of auditors.

5. Company Structure and Policy(1) Structure to Ensure That the Directors’ Execution of Duties Conforms to the Laws
and Regulations and the Articles of Incorporation and a Structure to Ensure theAppropriateness of Other Operations①. Structure related to storage and management of information related to the
execution of duties by directors
Information related to the execution of duties by directors is recorded, stored andmanaged in accordance with the Regulations of the Board of Directors andDocument Management Regulations, and the stored and managed information isaccessible to the directors and auditors at all times.
②. Regulations and other structures regarding management of risk of loss
1) Supervising segments will be established respectively for individual risks related
to compliance, disaster, business, information security, etc. and build a risk
management structure.
2) The Internal Audit will carry out internal audit of various departments regularly,
point out any matters that need to be improved with respect to management ofloss risks, and report the result to the president & CEO and corporate auditors.
③. Structure to ensure efficient execution of duties by directors
1) Regulations of the Board of Directors shall be established for the board of directors
meeting, which as a rule will be held once a month and as needed to ensure‐11‐communication between the directors. The directors shall mutually monitor the
execution of duties in accordance with laws and ordinances.
2) The important matters that have to be resolved at the board of directors meetingare stipulated in the Regulations of the Board of Directors, and will be resolved at
the board of directors meeting after being discussed at the Executive Committee
which comprises the president and the standing directors.
3) Each organizational unit has a director in charge and the Company has drafted theInternal Regulation on Organizations and the Internal Regulation on Duties andPowers that specify the duty and authority of each organizational unit andemployee.
④. Structure to ensure that the execution of the duties by directors and employees
conforms to the laws and regulations and Articles of Incorporation
1) The director (in charge of General Administration Department) will be placed incharge of compliance, who will establish the compliance structure, strive tounderstand the issues and the General Administration Department will ensure
the maintenance and improvement of the compliance structure.
2) The Internal Auditing Department monitors the operational status of thecompliance structure and reports the result regularly to the president & CEO andthe board of auditors.
⑤. If the corporate auditors request the appointment of employees to assist in theduties, matters related to such employees
1) The president & CEO assigns employees, independent of the Execution of
Operations Division, to assist the audit carried out by the board of auditors andthe corporate auditors.
2) As stipulated in the Regulations of the Board of Auditors, the employees mentioned
in the above paragraph, appointed to assist in the duties of the corporate auditors,
are engaged in the office work related to the operation of the board of auditors
such as invitation-related work and preparation of the meeting minutes.
⑥. Matters concerning the independence of the employees assigned to assist in theduties of the corporate auditors from directors
1) The transfer and evaluation of the employees assigned to assist the corporate
auditors’ duties as stipulated in the above article are to be carried out after
obtaining the consent of the board of auditors.
⑦. Structure to report to the corporate auditors including the structure for directors andemployees to report to them
1) In addition to statutory matters, the Company will put in place a structure for the
directors and the employees to make timely report regarding matters that could
have significant impact on the Company to the board of auditors.
2) As stipulated in the Regulations of the Board of Auditors, the board of auditors may
seek reports as necessary from the accounting auditors, directors, and employees‐12‐from the Internal Audit Division, etc., and others.
⑧. Structure to ensure that the audit by the corporate auditors is carried out effectively
1) There is a structure in place where the corporate auditors attend the board of
directors meeting and if necessary offer opinions and also attend important
meetings including the Executive Committee to directly grasp the deliberation ofimportant items and reporting items.
2) The board of auditors exchanges opinions with the CEO regarding matters to beaddressed by the Company, the status of preparation of environment for audits bycorporate auditors and important issues upon audit and make a request that isdeemed necessary.

(2) Overview of the Operational Status of the Structure to Ensure the Appropriatenessof Operations
The Company’s board of directors is made up of seven directors (of which two areexternal directors), and the board meets once a month in accordance with theRegulations of the Board of Directors. The board of directors meeting is attended by
the directors and corporate auditors, and each director reports the status of executionof business at the meeting, which also discusses and resolves important matters.
In the meetings, the external directors participate in the resolutions from an
independent perspective and supervise and monitor the management, with thecorporate auditors also monitoring the management in a similar manner.
The Company has in place a system where the corporate auditors not only attend
the board of directors meeting but also other important meetings such as the
Executive Committee, directly obtain the status of business execution from thedirectors and monitor on a daily operational basis the issues with the status ofbusiness execution and compliance so as to ensure the strengthening andimprovement of the management monitoring function.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Note: The amounts stated in this Business Report are rounded down to the nearest unit.

‐13‐

Balance Sheet(As of March 31, 2016)(Thousands of yen)

Assets
Account title
Current assets

Liabilities
Account title

Amount40,944,542

Current liabilities

Amount13,204,986

Cash and deposits

31,672,143

Accounts payable-trade

2,813,295

Accounts receivable - trade

3,999,921

Current portion of long-term loans payable

4,404,187

Merchandise

3,536,070(Preferred loan)( 4,404,187)

Accounts receivable - other

703,098

Accounts payable - other

1,641,071

Prepaid expenses

136,213

Accrued expenses

3,007,210

Deferred tax assets (current)

897,094

Income taxes payableNoncurrent assets
Property, plant and equipment

117,994,583

583,072

Accrued interest expenses

7,015

Other current liabilities

749,134

Noncurrent liabilities

139,386,058

116,860,088

Shareholder subordinated bonds

14,580,000

Buildings

101,760,007

Long-term loans payable

115,240,996

Structures

1,323,916(Preferred loan)( 97,240,996)

Machinery and equipment

6,057,240(Shareholder subordinated loans)( 18,000,000)

11,051Long-term lease deposited

475,917

Provision for directors' retirement benefits

49,825

VehiclesTools, furniture and fixtures

7,707,872

Interest rate swap liabilities
Total liabilities
Intangible assets
Software152,591,045
Net assets

61,64761,647

9,039,319

Shareholders' equity

15,387,400

Capital stock

9,000,000

Capital surplus

9,000,000

Investments and other assets

1,072,848

Legal capital surplus

9,000,000

Long-term prepaid expenses

62,839Retained earnings(2,612,599)

Deferred tax assets (noncurrent)

10,008Other retained earnings(2,612,599)

Separately managed penalty in trust

1,000,000

Retained earnings brought forward(2,612,599)

Valuation and translation adjustments(9,039,319)

Deferred gains or losses on hedges(9,039,319)

Total net assets

6,348,080

Total assets

158,939,126-

Total liabilities and net assets

14 -158,939,126

Income Statement
From April 1, 2015 to March 31, 2016
(Thousands of yen)Account title

AmountOperating revenue
Rents

4,520,710

Facility rental income

19,055,807

Sales of goods

42,227,491

Restaurant sales

1,899,444

Other revenue

3,116,034

70,819,488

Cost of sales
Cost of goods sold

29,253,752

Operating gross profit

41,565,735

Selling, general and administrative expenses

32,742,970

Operating income

8,822,764

Non-operating income
Interest income

6,722

Miscellaneous income

293,876

300,599

Non-operating expenses
Interest expenses

4,379,163

Amortization of business commencement expenses

99,258

Miscellaneous loss

5,285

Ordinary income

4,483,707
4,639,656

Extraordinary loss
52,344

Loss on retirement of noncurrent assets

Income before income taxes

52,344
4,587,312

Income taxes-current

651,168

Income taxes-deferred(380,073)

Net income

4,316,217- 15 -

Statement of Changes in Net Assets
From April 1, 2015
to March 31, 2016
(Thousands of yen)
Shareholders' equity
Retained earnings

Capital surplus

Capital stock

Balance as of April 1, 2015

Legal capitalsurplus

Other retained
earnings

Total capitalsurplusRetained earnings
brought forward

Total retained
earnings

Total shareholders'equity9,000,000

9,000,000

9,000,000(6,928,816)(6,928,816)

11,071,183

Net income

－

－

－

4,316,217

4,316,217

4,316,217

Net changes of
items other thanshareholders’ equity

－

－

－

－

－

－

Total changes during theperiod－－－4,316,217

4,316,217

4,316,217

9,000,000

9,000,000

9,000,000(2,612,599)(2,612,599)

15,387,400

Changes during the period

Balance as of March 31, 2016

Valuation and translation adjustments

Deferred gains orlosses on hedges

Total valuationand translation
adjustments

Total net assets(8,237,342)(8,237,342)

2,833,840－－

4,316,217

Net changes of items
other thanshareholders’ equity(801,976)(801,976)(801,976)

Total changes during theperiod(801,976)(801,976)

3,514,240

Balance as of March 31, 2016

(9,039,319)(9,039,319)

6,348,080

Balance as of April 1, 2015

Changes during the period

Net income

－

16 －

Notes to Non-consolidated Financial Statements
I. Notes on Matters Related to Important Accounting Policies
1. Criteria and methods for evaluating assets(1) Derivatives

Market value method(2) Inventory assets
Based on cost method using retail method (balance sheet values arecalculated using method of reducing book value when the contribution of inventories toprofitability declines)
2. Method of depreciation of noncurrent assets(1) Property, plant and equipment(2) Intangible assets

Straight line method

Straight line method
As for the software used in-house, the Company adopts the straight line
method based on an expected usage period of five years for internal use.

3. Criteria for recording reserves(1) Provision for directors’ retirement benefits
The Company records required allowance as of the end of the term inaccordance with internal rules on payment of directors’ retirement benefits
to prepare for the payment of retirement benefits to directors.
4. Treatment of consumption tax, etc.
The accounting treatment of consumption tax and local consumption tax is based on tax
exclusion method.
5. Treatment of deferred assets(1) Start-up cost
Depreciated using straight line method for 5 years
6. Inclusion of interest payable, etc. in noncurrent assets acquisition cost
The interest payable and loan-related ancillary cost incurred during the construction of thepassenger terminal building have been added to the acquisition cost (for the fiscal year underreview – yen; cumulative at the end of the fiscal year under review 3,380,012,000 yen) andrecorded as part of noncurrent assets.
7. Hedge accounting method(1) Hedge accounting method

Deferred hedge treatment(2) Hedge procedure and hedge target- Hedge procedure- Hedge target(3) Hedge policy

Derivative trading (interest swap trading)Borrowings based on variable interest rate
It is carried out with the aim of avoiding risks rising from futurefluctuation of interest rate and the Company’s policy is not to carry out
any speculative transactions.

(4) Method to evaluate the hedge effectivenessThe assessment on the effectiveness is omitted, as the importantconditions for hedge procedures and hedge target are the same and it isassumed in advance to fully offset the risk of interest rate fluctuations
from the start of the hedge and continuously thereafter.

- 17 -

II. Notes on Balance Sheet(Thousands of yen)

1. The amounts are rounded down to the nearest thousand.
2. Pledged assets
Assets pledged as collateral

Ordinary deposits

31,515,594

Accounts receivable - trade50,318

Buildings

101,760,007

Structures

1,323,916

Machinery and equipment

6,057,240

Separately managed penalty in trust
1,000,000
Liabilities corresponding to the above
Long-term loans payable
3. Total depreciation of property, plant and equipment

101,645,183
42,273,874

4. Monetary claims and obligations to subsidiaries and affiliates
Monetary claims
Monetary obligations

Accounts receivable – trade

74,673

Accounts receivable - other

12,853

Accounts payable - trade

2,813,295

Accrued expenses

2,491,983

Shareholder subordinated bonds
6,660,000
Long-term loans payable

6,660,000

Long-term lease deposited

250,634

III. Notes on Income Statement(Thousands of yen)

1. The amounts are rounded down to the nearest thousand.
2. Transactions with subsidiaries and affiliates
Operating transactions
Non-operating transactions

46,477,492
300,521

IV. Notes on Statement of Changes in Net Assets
1. The amounts are rounded down to the nearest thousand.
2. Type and total number of the Company’s shares outstanding as of the last day of the fiscal year
under review
Common stock

3,492

sharesPreferred stock

108

shares- 18 -

V. Notes on Tax Effect Accounting
Breakdown of main causes for deferred tax assets(Deferred tax assets)(Thousands of yen)Accrued enterprise tax, etc.

70,775

Provision for directors' retirement benefits

15,375

Loss carried forward

1,141,953

Deferred losses on hedges

2,789,534

Other

214,133

Deferred tax assets subtotal

4,231,773

Valuation reserve(3,324,670)

Deferred tax assets total

907,103

VI. Notes on Financial Instruments
1. Matters regarding the status of financial instruments
The Company manages funds only in short-term deposits and procures funds through loans
from financial institutions such as banks as well as from the shareholders and corporate bonds
issued to the shareholders.
The funds procured through loans and corporate bonds are mainly used as funds for capital
investment and stabilizing the interest expenses by carrying out interest rate swap trading
against the interest rate fluctuation risk of part of loans.
Derivative trading is limited to interest rate swap trading to avoid interest rate fluctuation
risk of loans.
2. Matters regarding market value of the financial instruments
The values on the balance sheet, market value and the difference between them as of March 31,
2016 (the Company’s account settlement date) are as follows.
(Thousands of yen)

Category

Value on theMarket valuebalance sheet

Difference
(*)

(*)

(1) Cash and deposits(2) Shareholder
subordinated bonds(3) Long-term loans
payable(4) Derivative trading

31,672,143

31,672,143（14,580,000）（22,851,381）

8,271,381（119,645,183）（129,856,766）

10,211,582（9,039,319）（9,039,319）－(*) Items that are recorded as liability are shown in parenthesis (－).

Note: Matters regarding the calculation method of market value of financial instruments andderivative trading- 19 -

(1) Cash and deposits
They are settled in a short period of time and their market values are roughly
equivalent to the book values. Therefore, the concerned book values are used.
(2) Shareholder subordinated bonds
The market value of shareholder subordinated bonds is calculated by discounting thesum of the principal and interest using the rate assumed in case of new issue.
(3) Long-term loans payable
The market value of long-term loans payable is calculated by discounting the sum of theprincipal and interest using the rate assumed in case of taking out new loans.
(4) Derivative trading
1) The trading for which hedge accounting is not applied: Not applicable.
2) The trading for which hedge accounting is applied: The amount equivalent to theprincipal stipulated by the contract amount or contract as of the settlement day foreach hedge accounting method is as follows.
(Thousands of yen)Calculation
Method ofType ofhedge

derivative

accounting

trading

Main target

Contractof hedging amount, etc.

method ofMarket value

the said
marketvalue

Fundamental
processing
methodInterest rate
swap trading
Fixed interest
payment,
variable receipt

Long-term
loans
payable86,863,000(9,039,319)

The price,
etc. indicatedby thefinancial
institution

VII. Notes on Real Estate for Rent, etc.
1. Matters regarding the condition of the real estate for rent, etc.
The Company owns a passenger terminal building that includes office spaces and commercial
facilities for rent as well as a multilevel, pay-by-the-hour parking lot in Haneda Kuko, Ota-ku,
Tokyo.
2. Matters regarding the market value of the real estate for rent, etc.
(Thousands of yen)

Property that includes

Value on the balance sheet

Market value

109,141,164

195,000,000

the portion that is used
as real estate for rent,
etc.
Note 1. The value includes offices, etc. which the Company uses.
2. The market value of important properties as of the end of the fiscal year under review
is the amount based on the actuary reports by real estate appraisers.

- 20 -

VIII. Notes on Related Party Transaction
Type

Name ofthecompany,etc.

The ratio of Relationshipvoting rights,
with theetc. in theparty
Company(Thousands of yen)Transactions

Transaction
value

Account title

Balanceat theend of theperiodFundprocurement–

Shareholder
subordinatedbonds

6,660,000–

Long-term
6,660,000
loans payable(Note 1)

Other
relatedcompany

Borrowing
funds

Japan
AirportTerminalCo., Ltd.

38%
direct–Accruedexpenses(Note 2)Businessconsignment

14,699,015(Note 3)

Procurementof goods

Accounts
payable—trade30,297,759

2,491,983

2,813,295(Note 4)Fundprocurement
Mainshareholder

Japan
Airlines Co.,
Ltd.

19%
direct––(Note 1)

Borrowing
funds–(Note 2)FundprocurementMain
ANA Holdings
shareholder
Inc.

19%
direct––(Note 1)

Borrowing
funds(Note 2)–

Shareholder
subordinatedbonds

3,330,000

Long-term
3,330,000
loans payable
Shareholder
subordinatedbonds

3,330,000

Long-term
3,330,000
loans payable

Terms and conditions of transactions and policy on deciding them
Note 1. Procurement conditions are in accordance with the Shareholder Subordinated Bond
Agreement signed between the Company and its six shareholders including the above
three companies on March 30, 2012 following the approval by the Board of Directors
Meeting on February 23, 2012 (prepared based on the loan terms of the Shareholders
Agreement agreed among the shareholders as of the establishment of the Company).
As for the repayment of the principal, it has been agreed that the order of the settlement ofclaims is after that of repayment of preferred loans from the lenders based on the Limited
Loan Contract Alteration Contract signed with the lenders.
Note 2．Loan conditions are in accordance with the Shareholder Subordinated Loan Agreement
signed between the Company and its nine shareholders including the above threecompanies on March 27, 2008 following the approval by the Board of Directors Meeting on
March 18, 2008 (prepared based on the loan terms of the Shareholders Agreement agreed
among the shareholders as of the establishment of the Company).
As for the repayment of the principal, it has been agreed that the order of the settlement ofclaims is after that of repayment of preferred loans from the lenders based on the Limited
Loan Contract Alteration Contract signed with the lenders.
Note 3．The business consignment conditions are decided upon price negotiations taking into

- 21 -

consideration the prevailing market situation and a contract on the conditions is signed.
Note 4 ． The goods procurement conditions are decided upon price negotiations taking into
consideration the prevailing market situation and a contract on the conditions is signed.

IX. Notes Regarding Per Share Information
1. Net assets per share

1,545,836.38 yen

2. Net income per share

1,186,638.18 yen

X. Matters Regarding Material Subsequent Events
Not applicable.

- 22 -

10th Business Term
Supplementary Statement
From April 1, 2015
to March 31, 2016

I.
II.

※

Supplementary Statement to Business Report
Supplementary Statement to Financial Statements

This document has been translated from the Japanese original,for reference purposes only.
If there is any discrepancy between this translated document and the Japanese original,
the original shall prevail.

Tokyo International Air Terminal Corporation

10th Business Term (from April 1, 2015 to March 31, 2016) Supplementary Statement
I Supplementary Statement to Business Report
1. Holding of an important position such as business executive director, etc. at another company

Category
External
Director
External
Director
External
AuditorName

Details of the
concurrently
held position

Concurrent position at

Masaki Saida
Tomoaki
Kobayakawa
MakotoSugimachi

Narita International
Airport Corporation
Tokyo Electric Power
Company, Inc.
Tokio Marine & Nichido
Fire Insurance Co., Ltd.

Relationship

Senior Executive
Vice PresidentManaging
Executive Officer
Managing
Executive Officer

Note 1. Tomoaki Kobayakawa retired as Managing Executive Officer of Tokyo Electric Power Company, Inc.
as of March 31, 2016 and assumed the position of Representative Director and President of TEPCOEnergy Partner, Incorporated as of April 1, 2016.
2. Makoto Sugimachi assumed the position of Senior Managing Executive Officer of Tokio Marine &Nichido Fire Insurance Co., Ltd. as of April 1, 2016.

II Supplementary Statement to Financial Statements
1. Details of property, plant and equipment and intangible assets(Thousands of yen)
Category

Type ofassetsProperty, plant and equipment
Intangible
assetsBook value
at the beginningof the period

Increase in
the term underreview

Decline in
the term
under review

Depreciation in
the term underreviewBook value atthe end of theperiodTotal
depreciation

Acquisition costat the end of theperiodBuildings

107,447,933

978,587

39,3786,627,134

101,760,007

27,220,756

128,980,764

Structures

1,476,632

3,350

－

156,066

1,323,916

556,189

1,880,106

6,411,302

118,151－472,213

6,057,240

1,923,610

7,980,850

15,349

－

－

4,298

11,051

178,845

189,896

9,245,269

1,388,435

12,9652,912,866

7,707,872

12,394,472

20,102,345(Subtotal)(124,596,488)(2,488,523)(52,344)(10,172,579) (116,860,088)

Constructionin progress

－

－

－

－

－

－

－

124,596,488

2,488,523

52,344

10,172,579

116,860,088

42,273,874

159,133,962

28,44562,691－

29,49061,647284,974

346,621

Machinery andequipment

VehiclesTools, furnitureand fixtures

Total(42,273,874) (159,133,962)

SoftwareNote 1. The main items contributing to the increase in the term under review include the upgrading of theterminal building system equipment 661,071,000 yen, repair work of TIAT Duty Free Shop Central
200,689,000 yen and construction of a counter for handing over products purchased at a downtown
duty free shop

475,896,000 yen.

2. The decline during the term under review is the retirement of the existing outlet due to theconstruction of the above counter

52,344,000 yen.

－１－

2. Details of the allowance(Thousands of yen)

Category

Balance at the
beginning of
the period

Increase during
the term underreview

76,275

18,626

Provision for directors'
retirement benefits

Decline during the term
under review
Use for its
Otherpurpose45,076

Balance at theend of the period－

49,825

Note: The reason for making the provision and the calculation method are described in 3. of I.
Notes on Matters Related to Important Accounting Policies.

3. Details of selling, general and administrative expenses(Thousands of yen)Account title

AmountRemarks

Directors' compensations

111,000

Employees' salaries

283,679

Provision for directors' retirement
benefits

18,626

Legal welfare expenses

11,167

Welfare expenses

2,228

Transportation expenses

47,960

Supplies expenses

35,276

Furniture and fixtures

63,569

Utilities expenses

552,083

Communication expenses

56,594

Insurance expenses

331,316

Repair expenses

1,277,095

Rent expenses

1,696,120

Conference expenses

8,553

Entertainment expenses

24,944

Taxes and public charges

1,245,975

Advertising expenses

466,326

Cleaning expenses

16,668Business consignment expenses

15,422,099
869,613

Miscellaneous expenses
Depreciation

10,202,070

Total

32,742,970－２－