Financial Results for the First Quarter Ended January 31, 2018
[Japan GAAP] (Consolidated)
Date:

March 1, 2018

Company Name and Code:

Tomoe Engineering Co., Ltd. and Subsidiaries - 6309
(URL: http://www.tomo-e.co.jp/index_e.html)

Stock exchange listing:

1st Section, Tokyo Stock Exchange

Head Office:5-15, Kitashinagawa 5-chome, Shinagawa-ku, Tokyo, Japan

President:

Hitoshi Yamamoto

Investor Relations Contacts:

Toshiaki Yakura, Director, General Manager of Accounting Division, Tel: (03) 3442-5127

Date to report Quarterly Consolidated Financial Statement: March 9, 2018
Date for Dividend Payment:

Not applicable to this financial quarter

Preparation of Supplementary Explanatory Materials for Quarterly Operating Results: Not preparedBriefing Session for Quarterly Operating Results: Not planned* Any fractional sums less than one million (or one thousand) yen are disregarded
1. Consolidated Financial Data for the First Quarter Ended January 31, 2018
(1) Results of Operation (Consolidated)

Quarter Ended January 31, 2018
Quarter Ended January 31, 2017

(Percent: Change from the same quarter of the previous year)
Net Sales
Operating Income
Ordinary Income
Millions ofMillions ofMillions ofYen
Percent
Yen
Percent
Yen
Percent
9,517
12.1
373
378.7
374
533.6
8,487
-4.8
77-28.6
59-47.2

Quarter Ended January 31, 2018
Quarter Ended January 31, 2017

Net Income Attributable toOwners of the Parent
Millions ofYen
Percent
252-1-Net Income per Share

Fully Diluted Quarterly
Net Income per Share

Yen
25.30
-0.16

Yen
-(Note) Comprehensive income
First Quarter ended January 31, 2018: 341 million yen (41.7%)

First Quarter ended January 31, 2017: 240 million yen (---%)(2) Financial Condition (Consolidated)

Quarter Ended January 31, 2018Year Ended October 31, 2017

Total Assets (A)(Millions of Yen)
36,27236,580Net Assets (B)(Millions of Yen)
27,12527,008Net Assets Ratio(B) / (A) (Percent)
74.8
73.8

(Reference) Net assets
First Quarter ended January 31, 2018: 27,125 million yen

Year Ended October 31, 2017: 27,008 million yen

2. Dividend Status(Record Date)
Year Ended October 31, 2017
Year Ending October 31, 2018Year Ending October 31, 2018
(Prospect)First
Quarter-Interim
Term
22.50
22.50

Annual Dividend (Yen)
ThirdEnd ofQuarter
Fiscal Year
22.50
-22.50Annual
45.00
45.00

(Note) Revisions since the most recently released dividend projection: None
3. Forecast for Earnings for the Year Ending October 31, 2018 (Consolidated)(Percent change from the previous Full Business Year)Net Sales
Operating Income
Ordinary Income(Millions of Yen) (Percent) (Millions of Yen) (Percent) (Millions of Yen) (Percent)
Full Business Year
42,8004.2
2,100-4.5
2,100-5.4
Net Income Attributable to Net Income per ShareOwners of the Parent(Millions of Yen) (Percent)
Yen
Full Business Year
1,430-4.9
143.31(Note) Revisions since the most recently released dividend projection: NoneNotes(1) Significant changes in subsidiaries during this period (changes in specific subsidiaries involving changes in thescope of consolidation): None
Number of new subsidiaries: __(Company names):
Number of eliminated subsidiaries: __(Company names):(2) Adoption of simplified accounting method and the specific accounting method: None
(3) Changes of the principles, procedures, and representation of the accounting policies
1) Change due to revision of accounting standard: None
2) Other changes than the above 1): None
3) Change in accounting estimates: None
4) Retrospective restatements: None
(4) Number of outstanding shares (Common stock)1) Number of outstanding shares as of quarter-end and year-end (including treasury stocks)
At January 31, 2018: 10,533,200 shares

At October 31, 2017: 10,533,200 shares

2) Number of treasury stocks as of quarter-end and year-end
At January 31, 2018: 554,817 shares

At October 31, 2017: 554,817 shares

3) Number of average shares (accumulated quarterly total)
At January 31, 2018: 9,978,383 shares

At January 31, 2017: 9,978,525 shares*The quarterly earnings report is exempt from the quarterly review procedure.
*Explanations for appropriate use of the earnings forecast and other special instructions
The forward-looking statements such as a forecast of our financial results described herein are based on theinformation currently available to us and certain assumptions that we believe are reasonable. Actual results could differ
materially due to various factors.
Please refer to the Financial Results for the Quarter (Attachments) on page 3, (3) [Analysis of Future Forecast on
Consolidated Earnings Forecast] of 1. [Qualitative Information on Quarterly Consolidated Operating Results] for theoperating results forecast.

Table of Contents (Supporting Data)

1. Qualitative Information on Quarterly Consolidated Operating Results...................................................................2(1) Analysis of Operating Results................................................................................................................................2(2) Analysis of Financial Condition..............................................................................................................................2(3) Analysis of Future Forecast on Quarterly Consolidated Earnings Forecast.......................................................3
2. Quarterly Consolidated Financial Statement and Notes.................................................................................................4(1) Quarterly Consolidated Balance Sheet. ................................................................................................4(2) Quarterly Consolidated Statements of Income & Quarterly Consolidated Statements of Comprehensive
Income.......................................................................................................................................................................6Quarterly Consolidated Statements of Income.....................................................................................................6Quarterly Consolidated Statements of Comprehensive Income.........................................................................7(3) Notes on Quarterly Consolidated Financial Statements…………………………………………………….. 8(Note for premise of going concern)……………………………………………………………... 8(Notes for significant changes in shareholder’s equity)…………………………………………... 8(Segment information) ………………………………………………………………………………...811. Qualitative Information on Quarterly Consolidated Operating Results(1) Analysis of Operating Results
During the consolidated first quarter year-to-date period, Japan’s economy continued on a gradual recovery trend,
owing to growth in exports and capital investment that was driven by improved corporate earnings, and a pickup in
personal consumption. Overseas economies also remained firm as a whole, in the context of an ongoing expansionof the US economy, the gradual recovery of European economies, and the underlying strength of the Asian economies
like China.
Given these circumstances, net sales for the Tomoe Engineering Group for the consolidated first quarter
increased 12.1% from the same period last year to 9,517 million yen because of increasing sales in both theMachinery & Equipment Business and Chemical Products Business. From an earnings aspect, operating income
was 373 million yen, 378.7% up from the same period last year because of higher income in both Businesses, while
ordinary income came to 374 million yen, 533.6% up from the same period last year because foreign exchange losses
were lower. Net income attributable to owners of the parent was shifted to 252 million yen profit from net loss of 1
million yen in the same period last year.
Operating results by segment were as follows.
(Machinery & Equipment Business)
In the Machinery & Equipment Business, net sales of components and repair services for domestic public sector
demand and net sales of machinery, equipment and works for domestic private sector demand increased, and net
sales of machinery, equipment and works for overseas remained steady. As a result, net sales for consolidated firstquarter year-to-date period were 1,596 million yen, 31.0% up from the same period last year.
With respect to earnings, operating loss was 94 million yen reduced by 215 million yen from 310 million yen in the same
period last year because of increased profits in all fields such as components and repair with high margins, machinery,equipment and works.

(Chemical Products Business)
In the Chemical Products Business, net sales of transport materials for semiconductor manufacturing applications in
the electronics materials sector, materials for motor vehicles, housing and construction applications in the industrial
materials sector, and UV curing resin in the fine chemicals sector were robust, and net sales of resin based on HongKong and the Shenzhen plastic compounding business increased. As a result, net sales of consolidated first quarteryear-to-date period were 7,921 million yen, 9.0% up from the same period last year.
With respect to earnings, operating income was driven by the growth in net sales of Hong Kong-based business andthe Shenzhen plastic compounding business, in addition to the expanded net sales of the industrial materials which
had comparatively high margins, and amounted to 467 million yen, 20.4% up from the same period one year earlier.
(2) Analysis of Financial Condition
Total assets as of the end of the consolidated first quarter under review were 36,272 million yen, down 0.8% or 308
million yen from the end of the previous consolidated fiscal year. This mainly reflected an increase of 1,215 million
yen in inventory, and a decrease of 1,324 million yen in notes and accounts receivable–trade, and a decrease of 770
million yen in cash and deposits.
Liabilities were 9,147 million yen, down 4.4% or 425 million yen from the end of the previous consolidated fiscal year,mainly because of an increase of 336 million yen in electronically recorded monetary debt, a decrease of 399 million
yen in income tax payable, a decrease of 607 million yen in provision for Bonuses.
2

Net assets stood at 27,125 million yen, 116 million yen or 0.4% up from the end of the previous consolidated fiscalyear. This mainly reflected an increase by 27 million yen in retained earnings, an increase of 57 million yen invaluation difference on available-for-sale securities, and an increase of 19 million yen in foreign currency translation
adjustment.
As a result of the above changes, the equity ratio at the end of the consolidated first quarter under review
increased by 1.0 point compared with the end of the previous consolidated fiscal year to 74.8%.
(3) Analysis of Future Forecast on Quarterly Consolidated Earnings Forecast
There are no revisions to the consolidated earnings forecast figures for the fiscal year ending in October 31, 2018that were announced in the “Financial Results for the Fiscal Year Ended October 31, 2017 [Japan GAAP](Consolidated)” released on December 7, 2017.

3

2. Quarterly Consolidated Financial Statement(1) Quarterly Consolidated Balance Sheets (First Quarter)(Thousands of Yen)
AssetsEnd of Previous YearEnd of First Quarter(October. 31, 2017)(January 31, 2018)

Current Assets
Cash and Deposits

7,893,336

7,122,687

Notes and Accounts Receivable-Trade12,423,898

11,098,937

Electronically Recorded Monetary Claims

1,823,085

2,453,450

Merchandise and Finished Goods

3,045,330

3,365,208

Work in Process

1,121,215

1,779,429

Raw Materials and Supplies

626,777864,297

Deferred Tax Assets

551,335

444,899

Others169,602

147,785-5,793-3,19327,648,788

27,273,501

4,447,596

4,448,436

Accumulated Depreciation-1,714,451-1,736,29

Buildings and Structures, Net

2,733,144

2,712,142

Machinery, Equipment and Vehicles

3,753,847

3,725,771

Accumulated Depreciation-3,339,171-3,326,898

Machinery, Equipment and Vehicles, Net

414,676
1,931,034

398,872
1,931,051－15,214

999,146

1,011,423-914,964-925,345

84,181

86,0785,163,038

5,143,359

186,343

176,989

Investment Securities

1,520,735

1,610,184

Guarantee Deposits

293,537

296,519

1,693,578

1,699,974

Others101,325

98,298

Allowance for Doubtful Accounts-26,386-26,385

Total Investments and Other Assets

3,582,791

3,678,590

Total Noncurrent Assets

8,932,172

8,998,939

Total Assets

36,580,961

36,272,441

Allowance for Doubtful Accounts
Total Current Assets
Noncurrent Assets
Property, Plant and Equipment
Buildings and Structures

LandConstruction in progress
Others
Accumulated Depreciation
Others, Net
Total Property, Plant and Equipment
Intangible Assets
Investments and Other Assets

Net Defined Benefit Assets4

(Thousands of Yen)
Liabilities and Net Assets

End of Previous YearEnd of First Quarter(October. 31, 2017)(January 31, 2018)

Liabilities
Current Liabilities
Notes and Accounts Payable-Trade

4,090,419

4,115,080

Electronically Recorded Monetary Debt

1,665,615

2,001,992

Accounts Payable-Others

520,046

493,842

Income Taxes Payable

437,430

37,720

Advances Received

57,481

230,161

Provision for Bonuses

982,841

375,744

Provision for Directors' Bonuses

64,67816,548

Allowance for Product Warranty

185,258

161,558

Others

189,552

311,471

8,193,325

7,744,120

Total Current Liabilities
Noncurrent Liabilities
Provision for Directors' Retirement Benefits

5,460

5,460

Net Defined Benefit Liabilities

57,49858,0271,315,959

1,339,456

Total Noncurrent Liabilities

1,378,918

1,402,944

Total Liabilities

9,572,243

9,147,064

Capital Stock

1,061,210

1,061,210

Capital Surplus

1,483,410

1,483,410

Retained Earnings

23,889,646

23,917,628

Treasury Stock-363,876-363,876

Total Shareholders’ Equity

26,070,38926,098,371

Accumulated Other Comprehensive Income
Valuation Difference on Available-for-Sale
Securities
Deferred Gains or Losses on Hedges

551,039

608,3992,508-2,455

Foreign Currency Translation Adjustment

214,564

233,782

Total Adjustment on Net Defined Benefit

170,216

187,276

Total Accumulated Other Comprehensive Income

938,328

1,027,004

Total Net Assets

27,008,718

27,125,376

Total Liabilities and Net Assets

36,580,961

36,272,441

Deferred Tax Liabilities

Net Assets
Shareholders’ Equity5(2) Quarterly Consolidated Statements of Income & Quarterly Consolidated Statements of Comprehensive
IncomeQuarterly Consolidated Statements of Income (First Quarter)(Thousands of Yen)First Quarter Ended
January 31, 2017

First Quarter Ended
January 31, 2018

Net Sales

8, 487,151

9,517,730

Cost of Sales

6, 811,659

7,480,483

1,675,491

2,037,246

1,597,538

1,664,090

77,953373,155

Interest Income

271

326

Dividends Income

8,096

9,488

Rent Income

1,707

1,717

Others

4,802

8,117

14,87819,651

Interest Expenses

4,453

7,693

Commission Paid756

756

Sales Discount

1,465

1,445

Foreign Exchange Losses

26,191

7,210829998

Total Non-Operating Expenses

33,69618,103

Ordinary Income

59,135

374,702

Income before Income Taxes and Minority Interests

59,135

374,702

Income Taxes-Current

2,711

23,639

Income Taxes-Deferred

58,052

98,567

Total Income Taxes

60,763

122,206

Net Income or Net Loss (-)-1,628

252,495

Net Income or Net Loss (-)-1,628

252,495

Gross Profit
Selling, General and Administrative Expenses
Operating Income
Non-Operating Income

Total Non-Operating Income
Non-Operating Expenses

OthersAttributable to Owners of the Parent6Quarterly Consolidated Statements of Comprehensive Income (First Quarter)
First Quarter Ended

First Quarter Ended

January 31, 2017

January 31, 2018

-1,628

252,495

Valuation Difference on Available-for-sale Securities

90,33557,360

Deferred Gains or Losses (-) on Hedges

17,187-4,963Foreign Currency Translation Adjustment

113,248

19,218Net Defined Benefit

21,71017,060Total Other Comprehensive Income

242,481

88,675

240,852

341,171

240,852

341,171

Net Income or Net Loss (-)
Other Comprehensive Income

Comprehensive Income(Breakdown)Comprehensive Income Attributable to Owners of theParent7(3) Notes on Quarterly Consolidated Financial Statements(Note for premise of going concern)
There are no pertinent matters to report.
(Notes for significant changes in shareholder’s equity)
There are no pertinent matters to report.
(Segment Information, etc.)
First Quarter Ended January 31, 2017
Information Pertaining to the Amount of Net Sales, Profit or Loss of Each Reporting Segment(Thousands of Yen)
Reported Segment
Machinery & Equipment
Business

Chemical Products
Business

1,218,604

7,268,547

8,487,151

8,487,151----Total

1,218,604

8,487,151

8,487,151

Segment Profit or Loss (-)-310,641

7,268,547388,594

77,953

77,953

Net Sales
Net Sales to UnaffiliatedCustomers
Internal Net Sales among
Segments or AmountTransferredTotal

Grand Total(Note) The total amount of segment profit or loss is identical to the operating income reported on the Quarterly Consolidated Statements ofIncome.

First Quarter Ended January 31, 2018
Information Pertaining to the Amount of Net Sales, Profit or Loss of Each Reporting Segment(Thousands of Yen)
Reported Segment
Machinery & Equipment
Business

Chemical Products
Business

1,596,009

7,921,720

9,517,730

9,517,730----Total

1,596,009

9,517,730

9,517,730

Segment Profit or Loss (-)-94,819

7,921,720
467,975

373,155

373,155

Net Sales
Net Sales to UnaffiliatedCustomers
Internal Net Sales among
Segments or AmountTransferred

Total

Grand Total(Note) The total amount of segment profit or loss is identical to the operating income reported on the Quarterly Consolidated Statements ofIncome8