Summary of Financial Results for the Fiscal Year Ended August 31, 2019
[Japan GAAP] (Consolidated)
Company
Stock Code
Representative
Contact

October 10, 2019
Listed on the TSE

Watts Co., Ltd.

2735
URL: https://www.watts-jp.com/
Fumio Hiraoka, President and CEO
Hidehito Mori,T E L: +81-6-4792-3280
Executive Managing Director, Head of Corporate Planning Office
Expected date of annual shareholders’ meeting: November 26, 2019
Expected starting date of dividend payment: November 27, 2019
Expected date of filing of annual securities report: November 26, 2019
Preparation of supplementary financial document: Yes
Results briefing: Yes (for institutional investors)（Rounded down to million yen）

１. Consolidated business results for the fiscal year ended August 2019
(September 1, 2018 through August 31, 2019)(1) Consolidated results of operations(% change from the previous corresponding period)
Sales

Operating profit

Million yen %Million yen
Year ended Aug. 2019
51,3993.9716
Year ended Aug. 2018
49,4804.2
1,000(Note) Comprehensive income:Fiscal year ended August 2019: -28 million yen (-%)
Fiscal year ended August 2018: 564 million yen (-30.4%)

%
-28.4
-17.2

Recurring profit
Million yen
656
1,037

%
-36.8
-18.5

Net income attributableto owners of parent
Million yen
%
70
-88.9
633
-24.5

Net income
per share

Diluted net income
Return on
Ratio of recurring
Ratio of operating
per share
equityprofit to total assets
profit to sales
Yen
Yen
%
%
%
Year ended Aug. 2019
5.26
0.7
3.2
1.4
Year ended Aug. 2018
46.79
6.2
5.2
2.0
(Reference) Investment earnings/loss on equity-method:
Fiscal year ended August 2019: 1 million yen
Fiscal year ended August 2018: 24 million yen(Note) The Company has changed its reporting method from the current fiscal year, and the figures for the fiscal year ended August 2018reflect this change. For more details, please refer to the term of “*Notes (5) Notes to consolidated financial statements (Changes inreporting method）” of 3. Consolidated Financial Statements on page 12.

(2) Consolidated financial position
Total assets

Net assets

Million yen
As of Aug. 2019
21,557
As of Aug. 2018
19,945(Reference) Shareholders’ equity:
As of August 2019: 10,150 million yen
As of August 2018: 10,418 million yen

Shareholders’ equity
ratio

Million yen
9,867
10,234

Net assets per
share

%
47.1
52.2

Yen
757.62769.05(3) Consolidated results of cash flows

Year ended Aug. 2019Year ended Aug. 2018

Cash flows fromoperating activities
Million yen
2,279
687

Cash flows frominvesting activities
Million yen
-832
-615

Cash flows fromfinancing activities
Million yen
-510
-658

Cash and cash equivalents
at the end of period
Million yen
6,075
5,147

2. Dividends
Annual dividendYear ended Aug. 2018Year ended Aug. 2019Year ending Aug. 2020
(forecast)End of
1Q
Yen
―
―
―

End of
2Q
Yen
0.00
0.00
0.00

End of
3Q
Yen
―
―
―

Year-end

Annual

Yen
15.00
10.00
10.00

Yen
15.00
10.00
10.00

Total
dividends(Total)Million yen
204
134

Dividend
payout ratio(Consolidated)
%
32.1
190.1
38.3

Rate of total
dividend to net
assets(Consolidated)
%
2.0
1.3

3．Forecast of consolidated business results for the fiscal year ending August 2020
(September 1, 2019 through August 31, 2020)(% change from the previous corresponding period)
Sales

For the six months
ending Feb. 2020
Year ending Aug. 2020

Operating profit

Net income
attributable to ownersof parent

Recurring profit

Net income pershare

Million yen%

Million yen%

Million yen%

Million yen%

Yen

25,500

-0.6

300

-18.2

310

-8.0

120

16.0

8.96

51,860

0.9

770

7.4

790

20.4

350

395.9

26.12

※Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries accompanying changes inthe scope of consolidation): None
(2) 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(3) Shares outstanding (common stock)① Number of shares outstanding at the end of period (treasury stock included)
As of August 201913,958,800 shares
As of August 2018
13,958,800 shares② Treasury stock at the end of period:
As of August 2019
560,874 shares
As of August 2018
410,874 shares③Average number of stock during period
Fiscal year ended August 201913,419,246 sharesFiscal year ended August 2018
13,547,926 shares(Note) The number of treasury stock at the end of period includes the Company’s shares held by the share issuancetrust for directors (FY8/19: 60,000 shares, FY8/18: 60,000 shares). In addition, the Company's shares ownedby the share issuance trust for directors are included in treasury stock deducted for calculation of the average
number of shares during period (FY8/19: 60,000 shares, FY8/18: 60,000 shares).
* Financial summary is not subject to the auditing procedures by certified public accountants or auditing firms* Explanation regarding appropriate use of business forecasts and other special instructions(Caution concerning forward-looking statements)
The forward-looking statements 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. Therefore, the Company does not make promises about the achievements. Actual results may differ
significantly from the forecasts due to various factors.
Please refer to “(4) future outlook” of “1. Results of operations” on page 4 for the suppositions that form theassumptions for business forecasts and cautions concerning the use of business forecasts.

1. Results of Operations

・・・・

2

(1) Overview of operating results for the current fiscal year

・・・・

2

(2) Overview of financial position for the current fiscal year

・・・・

3

(3) Overview of cash flows for the current fiscal year

・・・・

3

(4) Future outlook

・・・・

4

2. Basic policy regarding selection of accounting standards

・・・・

4

3. Consolidated Financial Statements

・・・・

5

・・・・
・・・・
・・・・

5
7
7

・・・・

8

(3) Consolidated Statements of Changes in Net Assets

・・・・

9

(4) Consolidated Statements of Cash Flows

・・・・

11

(5) Notes to consolidated financial statements

・・・・

12

(Notes on going concern assumption)

・・・・

12

(Notes if there is a significant change in the amount of shareholders' equity)

・・・・

12

(Changes in reporting method)

・・・・

12

(Segment information)

・・・・

12

(Per share information)

・・・・

13

(Important subsequent events)

・・・・

13

・・・・

14

・・・・

14

(1) Consolidated Balance Sheets(2) Consolidated Statements of Income and Statements of Comprehensive Income(Consolidated Statements of Income)(Consolidated Statements of Comprehensive Income)4. Other
Sales

- 1 -

1 Results of Operations（1） Overview of operating results for the current fiscal year

During the current fiscal year, Japan's economy remained strong as consumer sentiment remained favorable due to the rise inwages reflecting the tight employment situation. But the corporate sector remains under pressure as overseas demand is weak anddomestic demand is clouding because there seems to be no end to the U. S. – China trade friction, uncertainties about BREXIT andthe appearance of new sources of conflicts in Hongkong and South Korea. As a result, corporate performances remain uncertain.
Given this environment, in addition to the 100-Yen shop business in Japan, the Company, which operates the “Watts”, “Watts
with”, “meets.”, “silk”, etc., has been working on diversifying its revenue sources by undertaking other domestic businesses,
centering on the sale of life-style goods and discount goods as well as overseas business.
As for the domestic 100-Yen shop business, the Company has been working to assign dedicated staffs to each type of shop,
introduce products with prices higher than 100 yen (from 200 yen to 1,000 yen), make reordering based on POS data, and introduce
cashless payment system. In addition, the Company is working to create synergies among Group businesses, including thedevelopment of the “Watts Kadoma Minami Shop”, which combines 100-Yen shops and the discount shop”Real”, and the “Watts
Kagoshima Chuo Ekimae Aeon Shop”, which offers a product section of the Northern European life-style goods shop Søstrene
Grene.
As for the new shop openings, the Company opened 111 shops (including 1 franchised shop) against the full-year plan of 115
shops, although there were many relatively small sized shops.
There were 80 shop closings (including 5 franchised shops), including certain unprofitable shops and unpredictable closing of shops
where the Company’s shops were located in. As a result, the total number of 100-Yen shops at the end of the current fiscal year was
1,192, which includes 1,164 directly managed shops (net increase of 35), and 28 franchised/other shops (net decrease of 4).
Of these, the number of "Watts" and "Watts with", the Watts brand shops, increased to 520 (net increase of 101), accounting forabout 40% of the total.
As for the number of the domestic other shops at the end of the fiscal year, “Buona Vita,” a life-style goods shop offering
comfortable life, was 20 shops (net decrease of 1).
Buona Vita has been working to develop the existing shops, such as introducing new gift items. “Søstrene Grene”, a Denmark’s
life-style variety shop, was 5 shops (increased by 1). Its same-store sales have not yet reach the target, the Company will continue
to strengthen promotions using SNS and product lineups to create repeat customers. “Value-100,” the fresh-foods supermarket
collaboration, continues with 1 shop (unchanged). "Real", a discount shop, was 6 shops (increased by 2).
Regarding the overseas operation, the Company operates “KOMONOYA”, a fixed-price shop mainly in Southeast Asia. At theend of the current fiscal year, “KOMONOYA” operates 49 shops in Thailand (net increase of 12), 8 shops in Malaysia (net decreaseof 1), 9 shops in Vietnam (net decrease of 2), and 20 shops in Peru (net increase of 7). In China, a fixed price shop “小物家园 ”(KOMONOKAEN) was 2 shops (unchanged). The total number of own-brand shops “KOMONOYA” and “ 小 物 家园”(KOMONOKAEN) was 88 (increased by 16).
The numbers of local shops with sales floors consisting of the Company’s products are gradually increasing and expanding
particularly in Mexico and Brazil. The total number of shops, in addition to our group shops, exceeds 130 shops. In the previous
fiscal year, the local Malaysian subsidiary was spun off, thus transforming it from a directly managed to a franchise. This resulted
in a decline in overseas sales. But product supply is increasing steadily, and the Company is also accelerating initiatives toexpand sales channels.
As a result, for the fiscal year ended August 2019, sales were 51,399 million yen (up 3.9% YoY, 98.8% to the plan). Operating
profit was 716 million yen (down 28.4% YoY, 77.9% to the plan) and recurring profit was 656 million yen (down 36.8% YoY,
74.6% to the plan), due to lower same-store sales in the 100-Yen shop business (99.7% to the previous year result), as well as
higher labor costs reflecting higher minimum wages and increase in rent-to-sales ratio due to intensified competition in shop
openings. Net income attributable to owners of parent was 70 million yen (down 88.9% YoY, 26.1% to the plan) mainly due to therecording of impairment losses on “Søstrene Grene” store facilities in the second quarter. (*Year on year: comparison with theresults for the previous fiscal year. Ratio to plan: ratio to the business forecasts for the fiscal year ended August 2019)
Since the Group operates under a single segment consisting of the operation of 100-Yen shops associated business, segment
information is omitted.

- 2 -（2） Overview of financial position for the current fiscal year

(Assets)
As of the end of the current fiscal year ended August 2019, net assets stood at 16,099 million yen, an increase of 1,494 million
yen compared with the end of the previous fiscal year. This was mainly due to increases of 928 million yen in cash and deposits,
272 million yen in notes and accounts receivable, 269 million yen in merchandise and finished goods.
Fixed assets stood at 5,458 million yen, an increase of 117 million yen compared with the end of the previous fiscal year. Thiswas mainly due to increases of 55 million yen in software in progress included in “Other” item in intangible assets and 50 million
yen in long-term loans receivable included in “Other” item in investments and other assets.
As a result, total assets stood at 21,557 million yen, an increase of 1,612 million yen compared with the end of the previous fiscal
year.
(Liabilities)
As of the end of the current fiscal year ended August 2019, current liabilities stood at 10,375 million yen, an increase of 1,960
million yen compared with the end of the previous fiscal year. This was mainly due to increases of 1,044 million yen inelectronically recorded obligations, 699 million yen in notes and accounts payable-trade, and 115 million yen in income taxes
payable.
Fixed liabilities stood at 1,315 million yen, increased by 19 million yen. This was mainly due to an increase of 40 million yen
in long-term loans payable, and a decrease of 14 million yen in provision for directors’ retirement benefits.
As a result, total liabilities stood at 11,690 million yen, increased by 1,979 million yen from the end of the previous fiscal year.
(Net assets)
As of the end of the current fiscal year ended August 2019, net assets stood at 9,867 million yen, a decrease of 367 million yen
compared with the end of the previous fiscal year. This was due to a decrease of 133 million yen in retained earnings, andpurchase of treasury stock of 135 million yen. As a result, shareholders’ equity ratio stood at 47.1% (52.2% at the end of theprevious fiscal year).
（3） Overview of cash flows for the current fiscal year

Cash and cash equivalents (hereinafter referred to as “cash”) at the end of the current fiscal year ended August 2019 amounted
to 6,075 million yen, an increase of 928 million yen compared with the previous fiscal year.
Details and breakdown of each cash flow in the current fiscal year are as follows.
(Cash flows from operating activities)
Net cash provided by operating activities was 2,279 million yen (687 million yen was provided in the previous fiscal year). Cashwas provided mainly by an increase in trade payables of 1,779 million yen due to the fact that the last day of the current fiscal year
was a holiday of financial institutions, depreciation and amortization of 437 million yen, income before income taxes of 378 million
yen, and impairment loss of 197 million yen. Cash was used mainly for increase in accounts receivable-trade of 281 million yen
and income taxes paid of 273 million yen.

(Cash flows from investing activities)
Net cash used in investing activities was 832 million yen (615 million yen was used in the previous fiscal year). As for the
breakdown, there were payments for property, plant and equipment of 561 million yen for opening of new shops, payments forlease and guarantee deposits of 220 million yen, etc.
(Cash flows from financing activities)
Net cash used for financing activities was 510 million yen (658 million yen was used in the previous fiscal year). As for the
breakdown, there was repayment of long-term loans payable of 664 million yen.

- 3 -（4） Future outlook

While consumer sentiment is likely to suffer a temporary slowdown due the consumption tax hike in October, upcoming Tokyo
Olympic Games related demand is expected to grow. On the other hand, corporate profits are likely to be influenced by uncertainties
in Japan and overseas. Affected by these factors, the GDP is likely to advance steadily amid repeated up and downs.
Given this situation, the Group continues to make every effort to offer value-for-money products by investing accumulated
earnings in product development, through low-cost opening and closing of shops and low-cost shop operations. Furthermore, tomeet the diversified consumer needs, the Group will continue to aim for being the 100-Yen shop where customers can find a valueof more than ¥100.
Furthermore, with the aim of building a new revenue source to complement the 100-Yen shop business, the Group is actively
working on developing lines like “Buona Vita”,“Søstrene Grene”, and “Real”to provide the new driving force for further growthin the future.
As for the overseas business that is expected to grow greatly in the future, the Company will strive to expand existing businessand develop new markets, in order to further expand the sales share within the Group and to earn profits.
Based on the above, the Company expects the following consolidated operating results in the next fiscal year: sales of 51,860
million yen (up 0.9% year on year), operating profit of 770 million yen (up 7.4% year on year), recurring profit of 790 million
yen (up 20.4% year on year) and net income attributable to owners of parent of 350 million yen (up 395.9% year on year).
(Reference) Cash flow indicators(Reference) Cash flow indicators
Fiscal year
ended August 31,
2015
Equity ratio (%)
50.2
Market value
74.3
equity ratio (%)
Interest-bearing
debt to cash－
flows ratio(years)Interest coverage－
ratio (times)

Fiscal year
ended August 31,
2016

Fiscal year
ended August 31,
2017

Fiscal year
ended August 31,
2018

Fiscal year
ended August 31,
2019

50.1

49.7

52.2

47.1

70.3

88.0

64.5

38.3

1.7

1.3

1.7

0.4

148.8

284.3

157.9

522.6

(Notes) Equity ratio: Equity/Total assets
Market value equity ratio: Total market capitalization/Total assets
Interest-bearing debt to cash flows ratio: Interest-bearing debt/Operating cash flow
Interest coverage ratio: Operating cash flow/Interest payment
1 Total market capitalization is calculated by multiplying closing stock price at the end of the period by the total
number of shares issued at the end of the period (excluding treasury stock).
2 Net cash provided by operating activities in the consolidated statements of cash flows is used as ‘Operating cash
flow.’
3 Interest-bearing debt includes all debt on which interest is paid reported on the consolidated balance sheet.
4 For interest payment, interest expenses paid in the consolidated statements of cash flows are used.
5 ’Interest coverage ratio’ and ‘Interest-bearing debt to cash flows ratio’ for the fiscal year ended August 2015 are notpresented, since the cash flows from operating activities were negative.

2 Basic policy regarding selection of accounting standards
In order to secure comparability with domestic peer companies, the Company applies Japanese accounting standards.

- 4 -3. Consolidated Financial Statements(1) Consolidated Balance Sheets(Thousands of yen)Previous fiscal year
(August 31, 2018)

Current fiscal year
(August 31, 2019)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade
Merchandise and finished goods
Raw materials and supplies
Consumption taxes receivable
Other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation and impairment loss
Buildings and structures, net
VehiclesAccumulated depreciation and impairment loss
Vehicles, net
Tools, furniture and fixtures
Accumulated depreciation and impairment loss
Tools, furniture and fixtures, net
Land
Leased assets
Accumulated depreciation and impairment loss
Leased assets, net
Construction in progress
Total property, plant and equipment
Intangible assets
Other
Total intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Guarantee deposits
Other
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets- 5 -5,147,120
2,262,537
6,811,518
8,087
42,588374,125-40,991
14,604,987

6,075,315
2,535,234
7,081,181
7,571
98,166359,194-57,258
16,099,405

1,658,569-887,262
771,306
18,856-12,969
5,886
3,369,569-2,665,399
704,169
257,800
27,623-7,432
20,191
1,759,354

1,846,084-1,066,489
779,594
23,480-15,053
8,427
3,566,030-2,873,042
692,988257,800
27,623-14,058
13,56428,3191,780,694

69,54769,547

147,681
147,681472,690
420,341
2,481,628
140,832-3,8273,511,665
5,340,566
19,945,554

462,938
373,215
2,498,717
202,091-6,9463,530,016
5,458,392
21,557,797

(Thousands of yen)Previous fiscal year
(August 31, 2018)
Liabilities
Current liabilities
Notes and accounts payable-trade
Electronically recorded obligations
Short-term loans payable
Current portion of long-term loans payable
Income taxes payable
Accrued consumption taxes
Provision for loss on business liquidation
Provision for bonuses
Other
Total current liabilities

Current fiscal year
(August 31, 2019)

3,997,054
2,544,768
100,000
539,349
129,943
66,137
177,783
860,065
8,415,102

4,696,346
3,589,730
434,366
245,379
110,152
32,163
187,223
1,080,003
10,375,364

Noncurrent liabilities
Long-term loans payable
Liabilities relating to retirement benefits
Provision for directors’ retirement benefits
Provision for directors' stock-based benefits
Asset retirement obligations
Other
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity

532,182
264,848
38,78524,464
134,835
300,888
1,296,004
9,711,107

572,851
276,781
24,73532,721
152,399
255,893
1,315,382
11,690,746

440,297
1,637,636
8,459,425-137,991
10,399,368

440,297
1,637,636
8,325,881-273,120
10,130,694

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

20,482-883
19,598-184,519
10,234,447
19,945,554

5,411
14,443
19,855-283,500
9,867,050
21,557,797- 6 -(2) Consolidated Statements of Income and Statements of Comprehensive Income(Consolidated Statements of Income)(Thousands of yen)Previous fiscal year
(from September 1, 2017
to August 31, 2018)
Sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating revenues
Interest income
Dividends income
Equity in earnings of affiliates
Foreign exchange gains
Royalty income
Compensation income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Early-withdrawal penalty
Exchange loss
Other
Total non-operating expenses
Recurring profit
Extraordinary income
Gain on sales of noncurrent assets
Gain on liquidation of subsidiaries
Total extraordinary income
Extraordinary loss
Loss on retirement of noncurrent assets
Impairment loss
Loss on sales of shares of subsidiaries
Loss on liquidation of businessTotal extraordinary losses
Income before income taxes and minority interests
Income taxes-current
Income taxes-deferred
Total income taxes
Net income (loss)
Net income (loss) attributable to non-controlling interests
Net income attributable to owners of parent- 7 -Current fiscal year
(from September 1, 2018
to August 31, 2019)49,480,679
30,676,333
18,804,346
17,803,441
1,000,904

51,399,073
32,061,822
19,337,251
18,620,307
716,943

4,101
863
24,90816,243
6,002
5,125
21,914
79,15810,021
996
1,760
5,392
7,308
6,796
32,275

6,367
26,04010,38342,791
1,037,272

6,415
49,27734,9492,527
93,169656,050

1,053
15,623
16,676-

7,558
73,536
52,610133,706
920,242358,655
11,371
370,027
550,215-83,743
633,958

20,678
197,643
59,368277,690378,359
386,050
20,715
406,765-28,405-98,980
70,574

(Consolidated Statements of Comprehensive Income)(Thousands of yen)Previous fiscal year
(from September 1, 2017
to August 31, 2018)
Net income (loss)
Other comprehensive income
Valuation difference on available-for-salesecurities
Foreign currency translation adjustment
Share of other comprehensive income ofassociates accounted for using equity method
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to owners ofparentComprehensive income attributable to noncontrolling interests- 8 -Current fiscal year
(from September 1, 2018
to August 31, 2019)

550,215-28,405-5,794-15,070

17,851-3,0482,641

18,375

14,698564,914256-28,149

648,657

70,830-83,743-98,980

Consolidated Statements of Changes in Net Assets
Previous fiscal year (from September 1, 2017 to August 31, 2018)(Thousands of yen)
Shareholders’ equity

Balance at the beginning ofcurrent period

Capital stock

Capital surplus

440,297

1,637,636

Retainedearnings
8,029,585

Treasury stock

Total shareholders’equity-137,991

9,969,528

Changes of items during
the period
Dividends from surplus-204,118-204,118

Net income attributableto owners of parent

633,958

633,958

Net change in items
other than shareholders'equityTotal changes of items
during the period--

429,839-429,839

Balance at the end ofcurrent period

440,297

1,637,636

8,459,425-137,991

10,399,368

Accumulated other comprehensive income

Balance at the beginning ofcurrent period

Valuationdifference on
available-for-salesecurities

Foreign currencytranslation
adjustment

Total accumulated
othercomprehensive
incomeNon-controllinginterests

Total net assets

26,277-21,377

4,900-100,776

9,873,652

Changes of items during
the period
Dividends from surplus-204,118

Net income attributableto owners of parent

633,958

Net change in items
other than shareholders'equity-5,794

20,493

14,698-83,743-69,044

Total changes of items
during the period-5,794

20,493

14,698-83,743

360,795

Balance at the end ofcurrent period

20,482-883

19,598-184,519

10,234,447- 9 -Current fiscal year (from September 1, 2018 to August 31, 2019)(Thousands of yen)
Shareholders’ equity

Balance at the beginning ofcurrent period

Capital stock

Capital surplus

440,297

1,637,636

Retainedearnings
8,459,425

Treasury stock

Total shareholders’equity-137,991

10,399,368

Changes of items during
the period
Dividends from surplus-204,118-204,118

Net income attributableto owners of parent

70,57470,574

Acquisition of treasury
stock-135,128-135,128

Net change in items
other than shareholders'equityTotal changes of items
during the period---133,544-135,128-268,673

Balance at the end ofcurrent period

440,297

1,637,636

8,325,881-273,120

10,130,694

Accumulated other comprehensive income

Balance at the beginning ofcurrent period

Valuationdifference on
available-for-salesecurities

Foreign currencytranslation
adjustment

Total accumulated
othercomprehensive
incomeNon-controllinginterests

Total net assets

20,482-883

19,598-184,519

10,234,447

Changes of items during
the period
Dividends from surplus-204,118

Net income attributableto owners of parent

70,574

Acquisition of treasury
stock-135,128

Net change in items
other than shareholders'equity-15,070

15,327

256-98,980-98,723

Total changes of items
during the period-15,070

15,327

256-98,980-367,396

Balance at the end ofcurrent period

5,411

14,443

19,855-283,500

9,867,050- 10 -

(4) Consolidated Statements of Cash Flows(Thousands of yen)Previous fiscal year
(from September 1, 2017
to August 31, 2018)
Net cash provided by (used in) operating activities
Income before income taxes and minority interests
Depreciation and amortization
Impairment loss
Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for directors' bonuses
Increase (decrease) in liabilities relating toretirement benefits
Increase (decrease) in provision for directors’
retirement benefits
Increase (decrease) in provision for directors'
stock-based benefits
Increase (decrease) in provision for loss on
business liquidation
Interest and dividends income
Interest expenses
Loss on retirement of noncurrent assets
Loss (gain) on sales of shares of subsidiaries
Loss (gain) on liquidation of subsidiaries
Decrease (increase) in accounts receivable-trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable-trade
Increase (decrease) in accrued consumption taxes
Other
SubtotalInterest and dividends income received
Interest expenses paid
Income taxes paid
Income taxes refund
Net cash provided by (used in) operating activities
Net cash provided by (used in) investing activities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Payments for asset retirement obligations
Payments for lease and guarantee deposits
Proceeds from collection of lease and guarantee deposits
Proceeds from purchase of shares of subsidiaries
resulting in change in scope of consolidation
Payments for sales of shares of subsidiaries resulting inchange in scope of consolidation
Other
Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities
Net increase (decrease) in short-term loans payable
Proceeds from long-term loans payable
Repayment of long-term loans payable
Repayment of lease obligations
Purchase of treasury shares
Cash dividends paid
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Net cash provided by (used in) investing activities
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period- 11 -

Current fiscal year
(from September 1, 2018
to August 31, 2019)

920,242
383,72973,536
3,946
20,845
4,082-11,475

378,359
437,019
197,643
4,767
20,821
9,439-

21,664

11,9322,700-14,050

8,257

8,257

-

32,163-4,964
6,367
7,558
52,610-15,623-53,295-57,732
71,395-110,735-132,930
1,190,181
4,833-4,355-568,959
65,913
687,612-11,017
6,415
20,678-281,144-264,452
1,779,582-12,587
223,184
2,547,012
10,603-4,363-273,256
2,279,996-657,068
1,569-14,656-2,055-146,305
117,117-561,785-76,887-24,619-220,245
115,929

143,623－-27,640－-29,750-615,164-64,479-832,088-29,260
400,000-822,046-3,989-203,505-658,800-100,000
600,000-664,314-7,274-135,128-204,095-510,812

5,866-8,900-580,486
5,727,607
5,147,120

928,194
5,147,120
6,075,315

(5) Notes to consolidated financial statements(Notes on going concern assumption)
None(Notes if there is a significant change in the amount of shareholders' equity)
The Company acquired 150,000 shares of its treasury stock pursuant to the resolution of the Board of Directors meeting on
October 11, 2018. With this, treasury stock was increased by 135,128 thousand yen during the current fiscal year. As a result,treasury stock at the end of the current fiscal year was 273,120 thousand yen.
(Changes in reporting method)(Application of "Partial Revision of Accounting Standard for Tax Effect Accounting")
From the beginning of the current fiscal year, the Company has applied the "Partial Revision of Accounting Standard for Tax
Effect Accounting" (ASBJ Statement No. 28, February 16, 2018), and deferred tax assets are presented under "Investments andother assets."
As a result, 268,537 thousand yen of “Deferred tax assets” in “Current assets” was included in 420,341 thousand yen of“Deferred tax assets” in “Investments and other assets” in the consolidated balance sheets for the previous fiscal year.
(Consolidated Statements of Income)
1. Previously, real estate leasing transactions were recorded in "Rental income" and "Cost of rental income" under nonoperating income and non-operating expenses. However, from the current fiscal year, "Rental income" is now presented as"Sales" and "Cost of rental income" is presented as "Cost of sales".
The Company regards leasing to tenants as one of its businesses, and recognizes that rental income is a stable source of revenue.
Based on this recognition, the Company has changed its reporting method in order to more appropriately present the actual stateof its business operations.
As a result, in the consolidated statements of income for the current fiscal year, the amount of 35,780 thousand yen, which waspresented as "Rent Received" in non-operating income, was reclassified as "Sales", and the amount of 10,800 thousand yen,which was presented as "Cost of Rental Income" in non-operating expenses, was reclassified as "Cost of sales."

2. In the previous fiscal year, "Royalty income" and "Compensation income", which were included in "Other" under "Nonoperating revenue," are restated as independent accounts as their total exceeded 10% of non-operating revenue.
As a result, 33,042 thousand yen presented in "Other" under "Non-operating income" in the consolidated statements ofincome for the previous fiscal year has been reclassified as "Royalty income" of 6,002 thousand yen, "Compensation income"of 5,125 thousand yen, and "Other" of 21,914 thousand yen.
(Consolidated Statements of Cash Flows)
Payments for acquisition of intangible assets, which were included in "Other" in "Cash flows from investing activities" in theprevious consolidated fiscal year, have become more important in terms of monetary value, and therefore, are restated as
independent accounts from the current consolidated fiscal year. To reflect this change in presentation, the consolidated financial
statements for the previous fiscal year have been reclassified.
Accordingly, “Other” under the “Cash flows from investing activities” of 44,406 thousand yen is restated as payment for the“Purchase of intangible assets” of 14,656 thousand yen and “Other” of 29,750 thousand yen.
(Segment information)
Since the Group has a single segment consisting of the operation of 100-Yen shops and associated business, thisinformation is omitted.

- 12 -

(Per share information)

Net assets per share
Net income per share

Previous fiscal year
(from September 1, 2017 toAugust 31, 2018)

Current fiscal year
(from September 1, 2018 toAugust 31, 2019)

769.05 yen
757.62 yen
46.79 yen
5.26 yen(Notes) 1. No diluted net income per share is presented because dilutive shares do not exist.
2. The number of treasury stock at the end of period includes the Company’s shares held by the share issuance trust for
directors (FY8/18: 60,000 shares, FY8/19: 60,000 shares).
3. The Company's shares owned by the share issuance trust for directors are included in the treasury stock deducted in thecalculation of the average number of shares during period, which is the basis for calculating net income per share.
(FY8/18: 60,000, FY8/19: 60,000 shares).
4. The basis for calculating net income per share and diluted net income per share are as follows.

Net income attributable to owners of parent
Amount that does not belong to commonshareholders
Net income attributable to owners of parent
available to common shareholders
Average number of shares during the period

Previous fiscal year
(from September 1, 2017 toAugust 31, 2018)(Thousands of yen)
Current fiscal year
(from September 1, 2018 toAugust 31, 2019)

633,958

70,574－－(Important subsequent events)
None- 13 -

633,958

70,574

13,547,926 shares

13,419,246 shares4. Other
Sales
Sales by area and business type are as follows
AmountNumber of shops(Thousands of yen)

Year-on-yearchange (%)

Hokkaido area

1,979,879

109.5

As of August 31,
2019
73

Tohoku area

1,853,824

111.2

Kanto area

12,555,052

Chubu area

Area

Newly opened

Closed

4

4

71

12

3

100.0

283

23

22

6,698,783

104.6

191

23

8

Kinki area

10,400,623

103.9

223

22

21

Chugoku/Shikoku area

4,598,629

99.5

173

12

12

Kyushu area
100-Yen shop businessDirectly managed
Wholesale

4,442,251

106.3

150

14

5

42,529,043

103.1

1,164

110

75

8,870,030

107.7

148

29

15

Total

51,399,073

103.9

1,312

139

90

- 14 -