Consolidated Quarterly Financial Results
for the Nine Months Ended December 31, 2017 [Japanese GAAP]
February 13, 2018
Stock Exchange Listing: Tokyo
URL: http://www.hokuetsu-kishu.jp

Company:
Hokuetsu Kishu Paper Co., Ltd.
Stock Code:
3865
Representative: Sekio Kishimoto, President & CEO
Contact:
Tomonari Maruyama, General Manager, Accounting Department
Scheduled date of submission of quarterly report:
February 14, 2018
Scheduled date of commencement of dividend payments:–
Supplementary documents for quarterly results:
None
Quarterly results briefing:
None

TEL: +81-3-3245-4500(Figures rounded down to the nearest million yen)

1. Consolidated Business Results for the Nine Months Ended December 31, 2017
(April 1, 2017 through December 31, 2017)(1) Consolidated results of operations
Net sales

Nine months ended
December 31, 2017
Nine months ended
December 31, 2016
(Note) Comprehensive income:(% change from the previous corresponding period)
Net income attributable
Operating income
Ordinary income
to owners of parentcompany
Million yen%
Million yen%
Million yen%

Million yen%

200,667

2.2

8,151

(8.1)

10,795

10.0

6,975

0.3

196,342

11.38,873

77.5

9,812

110.6

6,957

174.7

Nine Months Ended December 31, 2017: 10,785 million yen (89.4%)
Nine Months Ended December 31, 2016: 5,695 million yen (79.4%)
Diluted earnings
Basic earnings per shareper share
Yen
Yen

Nine months ended
December 31, 2017
Nine months ended
December 31, 2016

36.94

36.08

36.92

35.65

(2) Consolidated financial position

As of December 31, 2017
As of March 31, 2017
(Reference) Equity:

Total assets
Net assets
Equity ratio
Million yen
Million yen%
372,307
189,81150.8
362,205
181,034
49.8As of December 31, 2017:
189,036 million yen
As of March 31, 2017:180,294 million yen

2. Dividends
End of 1Q
Yen

Annual dividend per share
End of 2Q
End of 3Q
Yen
Yen

Fiscal year ended–
6.00
March 31, 2017
Fiscal year ending–
6.00
March 31, 2018
Fiscal year ending
March 31, 2018 (forecast)(Note) Revisions to dividend forecasts published most recently: None–

Year-end

Total
Yen

Yen

6.00

12.00

6.00

12.00

–

3. Forecast of Consolidated Financial Results for the Fiscal Year Ending March 31, 2018
(April 1, 2017 through March 31, 2018)(% change from the previous corresponding period)
Net sales

Operating income

Million yen% Million yen%
Full year
275,000
4.8
12,000(7.0)(Note) Revisions to business forecasts published most recently: None-1-

Net income attributableBasic
to owners of parent earnings percompany
share% Million yen
%Yen
13.8
11,0006.0
58.25

Ordinary income
Million yen
16,000* Notes(1) Changes in significant subsidiaries during the nine months ended December 31, 2017 (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 restatement of prior period financial statements(i) Changes in accounting policies due to revision of accounting standards: None(ii) Changes in accounting policies other than (i): None(iii) Changes in accounting estimates: None(iv) Restatement of prior period financial statements: None
(4) Shares outstanding (common stock)(i) Number of shares outstanding at the end of period (treasury stock included):
As of December 31, 2017
209,263,814 shares
As of March 31, 2017
209,263,814 shares(ii) Number of treasury stock at the end of period:
As of December 31, 2017
20,221,685 shares
As of March 31, 2017
20,794,944 shares(iii) Average number of shares during period:
Nine months ended December 31, 2017 188,817,769 shares
Nine months ended December 31, 2016 188,435,945 shares* The quarterly business result report is exempt from the quarterly review procedure based on the Financial
Instruments and Exchange Act.
* Explanation regarding appropriate use of business forecasts and other special instructions
The forward-looking statements such as forecasts of financial results contained in this material are based on information available to theCompany at the time of the publication of this document and certain assumptions that the Company considers to be reasonable, and may differ
materially from the actual results due to various factors. Refer to “1. Qualitative Information on Consolidated Operating Results, etc. for theNine-Month Period; (3) Qualitative Information Concerning Consolidated Earnings Forecasts” on page 3 of the accompanying materials formatters related to results forecasts.

* This document is an excerpt translation of the original in Japanese and is for reference purposes only. In case ofany discrepancy between this document and the original in Japanese, the latter shall take precedence.

-2-1. Qualitative Information on Consolidated Operating Results, etc. for the Nine-Month Period(1) Qualitative Information Concerning Consolidated Operating Results
During the nine months under review, net sales were 200,667 million yen (up 2.2% year on year), operating income was 8,151 million yen(down 8.1% year on year), ordinary income was 10,795 million yen (up 10.0% year on year) and net income attributable to owners ofparent company was 6,975 million yen (up 0.3% year on year) due to increased revenue and improved profitability of overseas subsidiaries,
while the raw fuel price rose sharply.

(2) Qualitative Information Concerning Consolidated Financial Position
Total assets increased 10,102 million yen from the end of the previous fiscal year, to 372,307 million yen. Major factors included increases
in cash and deposits of 5,348 million yen, merchandise and finished goods of 2,556 million yen and investment securities of 4,754 million
yen, chiefly reflecting rising stock prices, in spite of a decrease in property, plant and equipment of 3,658 million yen due mainly todepreciation.
Total liabilities increased 1,325 million yen from the end of the previous fiscal year, to 182,496 million yen. This was mainly becausenotes and accounts payable - trade, notes payable - facilities and accounts payable - facilities included in others under current liabilities,
and deferred tax liabilities included in others under non-current liabilities increased 1,411 million yen, 980 million yen, 889 million yen
and 1,003 million yen, respectively, despite a decrease in interest-bearing debt of 2,975 million yen.
Net assets rose 8,776 million yen from the end of the previous fiscal year, to 189,811 million yen. This chiefly reflected an increase inretained earnings of 4,709 million yen, due mainly to net income attributable to owners of parent company, and an increase in unrealized
holding gains on available-for-sale securities net of taxes of 2,903 million yen, due mainly to stock price increase.

(3) Qualitative Information Concerning Consolidated Earnings Forecasts
The full-year earnings forecasts announced on November 13, 2017 are not revised.

-3-2. Consolidated Quarterly Financial Statements and Key Notes(1) Quarterly Consolidated Balance Sheet(Million yen)
As of March 31, 2017
(Assets)
Current assets
Cash and deposits
Notes and accounts receivable - trade
Electronically recorded monetary claims
Merchandise and finished goods
Work in process
Raw materials and supplies
OtherAllowance for doubtful accountsTotal current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Machinery, vehicles, tools, furniture and fixtures
Accumulated depreciation
Machinery, vehicles, tools, furniture and fixtures, net

As of December 31, 201719,49464,1503,858
20,5101,976
22,402
7,254(48)

24,84260,756
5,508
23,066
1,885
24,3498,773(444)

139,598

148,738

80,360(47,394)

81,434(48,706)

32,96632,728

410,774(328,827)

417,089(338,560)

81,94678,529Other, net

29,46829,465

Total property, plant and equipment

144,381

140,722

3,172

3,063

68,906
8,606(2,460)73,6608,566(2,444)

Intangible assets
Investments and other assets
Investment securities
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets-4-75,052

79,782

222,606

223,569

362,205

372,307

(Million yen)
As of March 31, 2017
(Liabilities)
Current liabilities
Notes and accounts payable - trade
Electronically recorded obligations
Short-term loans payableCommercial papers
Income taxes payable
Provision
Other

As of December 31, 201720,1497,737
26,823
11,0001,334
3,109
13,40921,561
8,018
20,105
15,5001,064
2,085
15,05983,564

83,39530,00048,540840
13,6562,056
2,511

30,00047,919965
13,9282,676
3,610

97,605

99,101

Total liabilities

181,170

182,496

Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock

42,02045,39690,752(10,160)

42,02045,526
95,462(9,920)168,010173,089

10,534

13,438(56)
1,595
210(14)
2,343
179

12,284

15,946140600

120654

Total current liabilities
Non-current liabilities
Bonds payable
Long-term debt, less current maturities
Provision
Liability for defined benefit
Asset retirement obligations
Other
Total non-current liabilities

Total shareholders’ equity
Accumulated other comprehensive income
Unrealized holding gains on available-for-sale securities, netof taxes
Unrealized losses on hedging derivatives, net of taxes
Foreign currency translation adjustment
Remeasurements of retirement benefit, net of taxes
Total accumulated other comprehensive income
Share subscription rights
Non-controlling interests
Total net assets
Total liabilities and net assets-5-

181,034

189,811362,205

372,307(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive Income
Quarterly Consolidated Statements of Income(Nine-month period)(Million yen)
For the nine-month ended
December 31, 2016

For the nine-month ended
December 31, 2017

Net sales
Cost of sales

196,342
157,480

200,667
161,833

Gross profit

38,862

38,833

Selling, general and administrative expenses

29,98830,681

Operating income8,873

8,151

Non-operating income
Interest income
Dividends income
Foreign currency exchange gains
Other
Total non-operating income

50
778
1,823
931
3,584

55
933
1,238
1,733
3,961

Non-operating expenses
Interest expenses
Foreign currency exchange losses
Costs in relation to suspending the operation of production
equipment
Environmental expenses
Other
Total non-operating expenses

482
342

490
–

1,261

–

–
557
2,645

434
392
1,317

Ordinary income

9,812

10,7951612––
130

259
4630
138
1475

1,373
–
1–
12

2,378
16135540

Total extraordinary losses

1,387

2,630

Income before income taxes

8,455

8,640

968
578

1,501
26

Total income taxes

1,547

1,527

Net income

6,908

7,112

Extraordinary income
Gain on sales of property, plant and equipment
Gain on sales of investment securities
Gain on liquidation of associates
Insurance income
Other
Total extraordinary income
Extraordinary losses
Loss on sales or disposal of property, plant and equipment
Loss on disaster
Loss on reduction of property, plant and equipment
Loss on sales of shares of associates
Other

Income taxes - current
Income taxes - deferred

Net income (loss) attributable to non-controlling interests
Net income attributable to owners of parent company-6-(48)

137

6,957

6,975

Quarterly Consolidated Statements of Comprehensive Income(Nine-month period)(Million yen)
For the nine-month ended
December 31, 2016
Net income
Other comprehensive income
Unrealized holding gains on available-for-sale securities, net oftaxes
Unrealized gains on hedging derivatives, net of taxes
Foreign currency translation adjustment
Remeasurements of retirement benefit, net of taxes
Share of other comprehensive income of associates accounted
for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to owners of parentcompany
Comprehensive income attributable to non-controlling interests-7-

For the nine-month ended
December 31, 2017

6,908

7,112

2,734

1,960

169
(4,711)
(117)

38
758
(53)

712

969

(1,212)

3,673

5,695

10,785

5,845

10,637(149)

148

(3) Notes to Quarterly Consolidated Financial Statements(Notes to Going Concern Assumption)
Not applicable.
(Notes on Significant Change in the amount of Shareholders’ Equity)
Not applicable.

-8-