Consolidated Financial Results for the Fiscal Year Ending December 31, 2020
[Japanese GAAP]
February 9, 2021
Listed company name

Frontier Management Inc.

Listed Exchange Tokyo

Code number

7038

URL https://www.frontier-mgmt.com

Representative(Title)Representative Director(Name) Shoichiro OnishiContact person(Title)Executive Officer,
Head of Corporate
Strategy Department(Name) Junko Koshino

Scheduled date of the ordinary
general meeting of shareholders

March 25, 2021

Scheduled date ofcommencement ofdividend payment

Scheduled date to file Securities
ReportPreparation of supplementarymaterial on financial results: Yes
Results briefing: Yes

March 25, 2021

TEL 03-6862-8335

March 26, 2021

(for institutional investors and analysts)(Millions of yen are rounded down)
Consolidated financial results for the fiscal year ending December 31, 2020 (January 1, 2020 - December 31, 2020)(1)Consolidated Operating Results(Percentages indicate year-on-year changes.)
Net income attributable to
Net sales
Operating income
Ordinary income
owners of parent
JPY mil.
%
JPY mil.
%
JPY mil.
%
JPY mil.
%
△12.4
△15.2
△2.1
End of FY2020
5,192
8.8
580
575
420
△1.4
△9.1
End of FY2019
4,771
1.7
663
678
0.3
429
(NOTE)
FY12/2020
420 JPY(△2.4%)
FY12/2019430 JPY(△9.4%)
Comprehensive
mil.
mil.
incomeEnd of FY2020
End of FY2019(Reference) Equity inearnings of affiliates

Yen
36.89
37.65
FY12/2020

Shareholders'
Total assets
Net sales
equityOrdinary income Operating income
Net income ratio
ratio
margin
Yen
%
%
%
36.05
18.1
16.3
11.2
36.68
21.0
19.7
13.9
FY12/2019
13 JPYmil.

Fully diluted
Net income per share

Net income per share

7

JPY
mil.

(NOTE) We conducted a 2-for-1 stock split on October 1, 2019, and a 2-for-1 stock split on January 1, 2021. Net income per share and diluted net income pershare are calculated as if the stock split had taken place at the beginning of the previous fiscal year.

(2)Consolidated Financial Position
Total assets
JPY mil.
End of FY2020
3,792
End of FY2019
3,269
Reference:
FY12/2020
2,448
Shareholders' equity

Net assets
JPY mil.
2,448
2,185
JPY
FY12/2019
mil.

Equity Ratio
%
64.6
66.8
2,185

Net assets per share
Yen
213.05
191.63JPY
mil.

(NOTE) We conducted a 2-for-1 stock split on October 1, 2019, and a 2-for-1 stock split on January 1, 2021. Net assets per share are calculated on theassumption that the stock split was implemented at the beginning of the previous fiscal year.

(3)Consolidated Cash Flows
OperatingEnd of FY2020
End of FY2019

JPY mil.
456
137

Investing
JPY mil.
△59△203

Financing
JPY mil.
△230△317

Cash and cash equivalents
end of fiscal year
JPY mil.
1,899
1,733

2.Dividend Status
Dividend per share
End of firstquarter

End ofsecondquarter

End of thethird quarter

Term end

Total

Total dividend
amount(Total)Ratio of
Dividend
dividends topayout ratio
net assets(Consolidated(consolidated
)
)
%
%
30.5
6.4
32.5
5.9

Yen
Yen
Yen
Yen
Yen
JPY mil.
End of FY2019
0.00
23.00
23.00
131
End of FY2020
0.00
24.00
24.00
137
End of FY2021
0.00(Forecast)(NOTE)1.We plan to pay dividends for the fiscal year ending December 31, 2021 but have not yet decided on the amount to be paid.
2.We conducted a 2-for-1 stock split on January 1, 2021. The actual amount of dividends for the fiscal years ending December 31, 2019 and 2020 in theabove table is before the stock split is presented.

Forecasts for the fiscal year ending December 31, 3.2021 (January 1, 2,021 to December 31, 2021)(Percentages indicate year-on-year changes.)
Attributable to
Per share
Net sales
Operating income
Ordinary income
owners of parent
Net income
Net income
JPY
JPY
JPY
JPY
%
%
%
%
Yen
mil.
mil.
mil.
mil.
Full year
6,500
25.2
1,000
72.2
1,007
74.9
693
64.8
60.30
(NOTE)1. Due to the timing of recording sales of incentive fees in the Financial Advisory Business, the Group's performance fluctuates significantly during the
fiscal year. It makes it difficult to calculate consolidated earnings forecasts for the 2nd quarter (cumulative) and managing earnings for the fiscal
year. Accordingly, the Group only announces full-year earnings forecasts.
2.We conducted a 2-for-1 stock split on January 1, 2021. The impact of the stock split is taken into account for the "Net income per share" in the fiscal
year ending December 2021 forecast.

※ Notes(1)Changes in significant subsidiaries during this period (changes in specified subsidiaries accompanied by changes in the scope of
consolidation): None
(2)Changes in accounting policies and changes or restatement of accounting estimates① Changes in accounting policies due to revisions to accounting standards, etc.: None
② Changes in accounting policies other than ①: None
③ Changes in accounting estimates: None
④ Restatement of revisions: None
(3)Number of shares of common stock outstanding① Number of shares issued at the end of theperiod (including treasury stock)② Number of treasury stock at the end of theperiod③ Average number of shares during the period

FY12/2020

11,555,800

Shares

FY12/201911,412,000

Shares

FY12/2020

63,080Shares

FY12/2019

8,252

Shares

FY12/2020

11,397,504

Shares

FY12/2019

11,403,868

Shares(NOTE) We conducted a 2-for-1 stock split on October 1, 2019, and a 2-for-1 stock split on January 1, 2021. The number of outstanding shares at theend of the period (including treasury shares) and the number of treasury shares at the end of the period and the average number of shares during
the period (cumulative quarterly period) are calculated as if this stock split had taken place at the beginning of the previous fiscal year.

(Reference) Summary of Non-consolidated Financial Results
Non-consolidated results for the year ending December 31, 2020 (January 1, 2020 to December 31, 2020)(1)Explanations of Non-Consolidated Results of Operation(Percentages indicate year-on-year changes.)
Net sales
Operating income
Ordinary income
Net income
JPY mil.
%
JPY mil.
%
JPY mil.
%
JPY mil.
%
△13.2
△15.7
△1.0
End of FY2020
5,188
8.9
569
556
413
△2.1
△0.7
△9.6
End of FY2019
4,762
1.6
656
660
417
Net income per share
Yen
36.24
36.58

End of FY2020
End of FY2019

Fully diluted net income per
share
Yen
35.42
35.65

(NOTE) We conducted a 2-for-1 stock split on October 1, 2019, and a 2-for-1 stock split on January 1, 2021. Net income per share and diluted net income pershare are calculated as if the stock split had taken place at the beginning of the previous fiscal year.

(2)Non-consolidated Financial Position
Total assets
JPY mil.
End of FY2020
3,759
End of FY2019
3,243
Reference:
Shareholders' equity

FY12/2020

2,414

Net assets
JPY mil.
2,414
2,158
JPY
mil.

FY12/2019

Equity Ratio
%
64.2
66.5
2,158

Net assets per share
Yen
210.09189.27JPY
mil.

(NOTE) We conducted a 2-for-1 stock split on October 1, 2019, and a 2-for-1 stock split on January 1, 2021. Net assets per share are calculated on theassumption that the stock split was implemented at the beginning of the previous fiscal year.

※ This financial results report is not subject to the audit by a certified public accountant or an auditing firm.
※ Explanations and other special notes concerning the appropriate use of business performance forecasts(Cautionary Statement with Respect to Forward-Looking Statements)
The earnings forecasts and other forward-looking statements herein are based on information currently available to us andcertain assumptions that we believe to be reasonable, and are not intended to guarantee the achievement of the forecasts.
Actual results may differ materially from the forecast depending on a range of factors. Please refer to "1. Overview ofOperating Results, etc., (4) Future Outlook" on page 4 of the attached materials for the assumptions for the forecasts and cautions
regarding the use of the forecasts.

○Accompanying Materials – Contents
1.Overview of Financial Results, etc. ...................................................................................................................................... ..

2(1)Overview of Operating Results for the Fiscal Year...................................................................................

2(2)Overview of Financial Position for the Fiscal Year...................................................................................

2(3)Overview of Cash Flows for the Fiscal Year..............................................................................................

3(4)Future Outlook ................................................................................................................ ....................................................

3

2.Basic Concept to Selection of Accounting Standards ............................................................................................................

4

3.Consolidated Financial Statements ..........................................................................................................................................

5(1)Consolidated Balance Sheets ..............................................................................................................................................

5(2)Consolidated Statements of Income and Consolidated Statements of Comprehensive Income. .......................................

7

Consolidated Statements of Income.............................................................................................................................

7

Consolidated Statements of Comprehensive Income ..................................................................................................

8(3)Consolidated Statements of Shareholders’ Equity ..............................................................................................................

9(4)Consolidated Statements of Cash Flows .................................................................................... ........................................

11(5)Notes to Consolidated Financial Statements ......................................................................................................................

12(Notes on Going Concern). .............................................................................................................................................

12(Additional Information). ................................................................................................................................................

12(Segment Information). .....................................................................................................................................................

12(Per Share Information) ..................................................................................................................................................

12(Significant Subsequent Events) .....................................................................................................................................

131

1. Overview of Financial Results, etc.
(1) Overview of Operating Results for the Fiscal YearThe outlook for the Japanese economy during the fiscal year (January 1, 2020 to December 31, 2020) is extremely uncertain, as
economic activity stagnated due to the impact of restricted travel and activity self-restraint caused by the expansion of the COVID19 and the outlook for the future remains unclear amid sluggish consumer spending and a decline in corporate capital spending
following the consumption tax hike.
Under such a business environment, our group continued to focus on proposals aimed at resolving corporate issues in an
integrated manner by providing comprehensive services that leverage management consulting, financial advisory, revitalization
support, and other functions.
As a consequence of the above factors, in the Financial Advisory Business, although sales decreased compared with the previous
fiscal year due to the impact of the COVID-19, sales increased significantly in the Management Consulting Business and the
Revitalization Support Business, resulting in net sales of JPY5,192,527 k (up 8.8% compared with the previous fiscal year).
In terms of expenses, recruitment and personnel expenses increased as a result of aggressive recruitment of personnel in
preparation for management consulting needs and revitalization support needs, which are expected to increase further in the future,
far exceeding initial plans. In addition, a loss of JPY57,566 k was recorded on operating investment securities. As a result, operating
income was JPY580,805 k (down 12.4% year on year) and ordinary income was JPY575,633 k (down 15.2% year on year). On theother hand, net income attributable to owners of parent was JPY420,515 k (down 2.1% year on year) due to the elimination of the
impact of the head office relocation expenses of JPY43,169 k, which had been recorded as an extraordinary loss in the previous
fiscal year.
An overview of operating results by business segment is as follows.
<Management Consulting Business>
The operating results of the management consulting business for the current consolidated fiscal year were JPY2,416,443 k in net
sales (up 19.8% year on year). During the fiscal year, multiple orders from the same customer increased, and sales in theManagement Consulting Business increased as a result of the increasing size of projects.
<Financial Advisory Business>
In the Financial Advisory Business, net sales for the fiscal year amounted to JPY1,777,946 k (down 13.9% year on year). In thefiscal year, the impact of the COVID-19 restricted physical movement to foreign countries. As a result, cross-border M&A
transactions between domestic companies and overseas companies were suspended or delayed. As a result, net sales decreased
compared with the previous fiscal year.
<Revitalization Support Business>
The business results of the Revitalization Support Business for the fiscal year were net sales of JPY944,359 k (up 66.4% year onyear). In the fiscal year, net sales increased significantly due to the continued strong number of referrals from financial institutions
from the previous fiscal year and the execution of multiple large-scale projects.
<Other Business>
The results of the Other Business for the fiscal year were net sales of JPY53,777 k (down 56.3% year on year).
(2) Overview of Financial Position for the Fiscal Year
(Assets)
Total assets at the end of the fiscal year were JPY3,792,731 k (end of the previous fiscal year was JPY3,269,111 k), increased
JPY523,620 k. Current assets were JPY2,994,271 k (end of the previous fiscal year was JPY2,585,177 k) and non-current assets
were JPY798,459 k (end of the previous fiscal year was JPY683,933 k). Current assets increased by JPY409,094 k and noncurrent assets increased by JPY114,525 k. The main changes in current assets were an increase of JPY165,865 k in cash anddeposits and an increase of JPY267,411 k in notes and accounts receivable. The main changes in non-current assets were an
increase of JPY56,800 k in investment securities and an increase of JPY49,326 k in deferred tax assets.
(Liabilities)
Total liabilities at the end of the fiscal year were JPY1,344,132 k (end of the previous fiscal year was JPY1,083,769 k), an
increase of JPY260,362 k. Current liabilities were JPY1,261,874 k (end of the previous fiscal year was JPY1,001,516 k) andnon-current liabilities were JPY82,257 k (end of the previous fiscal year was JPY82,253 k). Current liabilities increased by2

JPY260,357 k and non-current liabilities increased by JPY4 k. The main changes in current liabilities were an increase of
JPY40,775 k in accounts payable-trade, an increase of JPY55,129 k in accounts payable-other, an increase of JPY70,250 k inincome taxes payable, and an increase of JPY124,110 k in other current liabilities, mainly due to an increase in accrued tax.
(Net Assets)
Net assets at the end of the fiscal year under review were JPY2,448,598 k (end of the previous fiscal year was JPY2,185,341k), an increase of JPY263,257 k. This was mainly due to the recording of net income attributable to owners of parent of
JPY420,515 k and the disposal of treasury stock as restricted stock awards of JPY75,438 k (a decrease of JPY54,577 k in treasury
stock and an increase of JPY20,860 k in capital surplus), which increased. On the other hand, there was a decrease in retained
earnings due to dividends of JPY131,143 k and the acquisition of treasury stock of JPY112,127 k.
(3)Overview of Cash Flows for the Fiscal Year
Cash and cash equivalents (hereinafter referred to as "funds") for the fiscal year increased by JPY165,865 k from the end of theprevious fiscal year to JPY1,899,100 k.
The status of cash flows and their factors for the current consolidated fiscal year are as follows.
Cash flows from operating activities
Net cash provided by operating activities was JPY456,102 k (end of the previous fiscal year was JPY137,641 k). This was mainly
due to an increase in income before taxes of JPY575,633 k, an increase in accrued tax of JPY132,016 k. and an increase in tradereceivables of JPY267,373 k.
Cash flows from investing activities
Net cash used in investing activities was JPY59,305 k (end of the previous fiscal year was JPY203,350 k). This was mainly due
to purchase of investment securities of JPY56,800 k.
Cash flows from financing activities
Net cash used in financing activities was JPY230,684 k (end of the previous fiscal year was JPY317,748 k). This was mainly
due to dividend payments of JPY129,342 k and purchase of treasury stock of JPY112,127 k.
(4)Future Outlook
In the wake of the COVID-19 crisis, which is now undergoing a major transformation globally, the needs of borderless companies
for drastic business reforms and corporate revitalization are also on the rise. We are also seeing an increase in referrals from financial
institutions based on requests from companies at various stages regardless of company size.
On January 1, 2021, we reorganized our group into a cross-industrial organizational structure in order to build a system forproviding services that meet a variety of needs in response to this market environment.
Specifically, in addition to the existing Financial Advisory Department, which provides financial advisory services, weestablished the Corporate Strategy Department, which mainly provides strategic planning services for business entities, theManagement Consulting Department, which mainly provides consulting services for financial institutions, and the Management
Execution Support Department, which provides management execution support services.
We often team up across divisions to create the best team for our customers when executing deals. As a result, one division does
not necessarily conduct only one business (management consulting, financial advisory, revitalization support, and other businesses),
but also conducts multiple businesses in one division. At the time of formulating the plan, it is difficult for each division to forecast
net sales by business, and no forecast by business is made for the entire company. Therefore, we do not disclose the forecast bybusiness.
In the Management Consulting Business, we aim to expand our business by formulating M&A strategies, and responding to
growing needs such as for SCMs (Supply Chain Management: management methods for integrating the flow of industries fromsuppliers to final consumers and realizing process-wide streamlining and optimization), sales reforms supports, resident support
consulting, and management dispatch services.
Furthermore, DX (digital transformation) service, whose needs are rapidly increasing due to the spread of the COVID-19, waslaunched, and combined the know-how accumulated through business revitalization and management innovation and recent IT
technology. A unique business transformation service is provided. The service area is expanded to support business transformationand new business development through DX, as well as expanded to support for the construction of DX platforms, coordinating not
only with our own resources but also business partners.
In addition, crisis management and forensics experts will start offering a new set of solutions, ranging from fraud investigations
and crisis management publicity, to the formulation of measures to prevent recurrence and support for implementation, from3

responding appropriately in the event of a crisis to recovering and improving corporate value by building governance.
During the COVID-19 crisis, the pace of change in society and corporations, which had been continuing, is accelerating, andnew changes are occurring. To address the increasingly complex and multi-layered issues facing corporations, our goal is to be
deeply involved in strategy as a company collusion to assist the top management of client companies.
In the Financial Advisory Business, the number of M&A transactions in Japan has consistently increased since 2011, and the
M&A market is expected to remain brisk due to industry reorganization to respond to market changes, the sale of non-corebusinesses and sluggish businesses to improve earnings, an increase in cross-border M&A to develop overseas markets, and anincrease in business succession-type M&A associated with the aging of domestic managers of small and medium-sized companies.
As a result, we will aim to steadily expand our business. In particular, for cross-border M&A to cultivate abroad markets, we are
becoming a full member of the CFI (Corporate Finance International: an M&A firm that operates globally in more than 20 countries,
mainly in Europe, and our representative, Matsuoka, is appointed as a director of CFI). We are using this network to accessinformation on trading candidates for overseas companies, thereby strengthening our cross-border M&A functions.
In the revitalization support business, an increasing number of companies are experiencing financial difficulties due to the impactof the COVID-19 crisis, and the number of consultations from such financial institutions aiming to support the revitalization offinancial institutions' borrowers is increasing. Therefore, we will aim to expand our business by reliably responding to revitalizationneeds.
Based on the above, the forecasts for the next fiscal year are for net sales of JPY6,500,000 k (up 25.2% from the current fiscal
year), operating income of JPY1,000,000 k (up 72.2%), ordinary income of JPY1,007,000 k (up 74.9%), and net income attributableto owners of parent of JPY693,000 k (up 64.8%).

2.Basic Concept to Selection of Accounting Standards
The Group prepares its consolidated financial statements in accordance with Japanese GAAP, considering the comparability ofconsolidated financial statements between periods and between companies. With regard to the adoption of International Financial
Reporting Standards, the Company's policy is to respond appropriately, taking into account various domestic and overseas
circumstances.

4

3.Consolidated Financial Statements(1)Consolidated Balance Sheets(Thousands of yen)
End of previous fiscal year
(As of December 31, 2019)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable
Operational investment securities
OthersAllowance for doubtful accounts
Total current assets
Fixed assets
Property, plant and equipment
Buildings, net
Tools, furniture, and fixtures, net
Total property, plant and equipment
Intangible assets
Software
OthersTotal intangible assets
Investments and other assets
Investment securities
Stocks of subsidiaries and affiliates
Lease deposits
Deferred tax assets
OthersTotal investments and other assets
Total noncurrent assets
Total assets

5

End of current fiscal year
(As of December 31, 2020)

1,733,235
695,233
56,394113,966△13,651
2,585,177

1,899,100
962,644
1,364
146,795△15,633
2,994,271

218,677
28,326
247,003198,844
19,951
218,795

14,640102
14,742

11,043102
11,14529,871
211,086
174,9106,318
422,187
683,933
3,269,111

56,80037,127211,126
224,236
39,228568,518
798,459
3,792,731

(Thousands of yen)
End of previous fiscal year
(As of December 31, 2019)
Liabilities
Current liabilities
Accounts payable
Accounts payable-other
Income taxes payable
Provision for bonuses
Provision for directors' bonuses
OthersTotal current liabilities
Long-term liabilities
Asset retirement obligations
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders' equity
Paid-in Capital
Capital surplus
Retained earnings
Treasury stock
Total shareholders' equity
Other accumulated comprehensive income
Foreign currency translation adjustment
Total other accumulated comprehensive income
Total net assets
Total liabilities and net assets

6

End of current fiscal year
(As of December 31, 2020)

18,631
92,783
158,336
511,547
25,098
195,120
1,001,516

59,407
147,912228,587505,7361,000
319,230
1,261,874

82,25382,253
1,083,769

82,257
82,257
1,344,132

158,137
808,967
1,206,655△613
2,173,146

163,530
835,220
1,496,027△58,1632,436,614

12,194
12,1942,185,341
3,269,111

11,984
11,9842,448,598
3,792,731

(2)Consolidated Statement of Income and Consolidated Statement of Comprehensive Income
Consolidated Statements of Income(Thousands of yen)
End of previous fiscal year
(January 1, 2019
to December 31, 2019)
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Salaries and allowances
Provision for bonuses
Provision for directors' bonuses
Retirement benefit expenses
Transfer of allowance for doubtful accounts
OthersCost of sales and totals general administrative
expenses
Operating income
Non-operating income
Interest income
Equity in earnings of affiliates
Insurance dividend income
Income from insurance claim
Administrative fees received
Subsidy from Government etc.
OthersTotal non-operating income
Non-operating expenses
Interest expenses
Market change costs
Expenses for information security
Foreign exchange losses
OthersTotal non-operating expenses
Ordinary income
Extraordinary losses
Expenses for relocation of head officeTotal extraordinary loss
Income before income taxes
Income taxes
Income taxes-deferred
Total income taxes
Net income
Net income attributable to owners of parent

7

End of current fiscal year
(January 1, 2020
to December 31, 2020)

4,771,144
1,795,483
2,975,660

5,192,527
2,083,943
3,108,583

888,717
253,878
25,09817,496
1,127,230

1,013,018
237,237
1,000
19,452
1,981
1,255,088

2,312,420

2,527,778

663,240

580,80555
13,380
1,158
9,927
2,354
1,352
28,227

78
7,255
968
72
2,268
2,759
52
13,456

727
9,110
2,757
12,595
678,872667
17,376328
256
18,628575,633

43,16943,169635,703
133,951
72,369206,320429,382
429,382575,633
204,444△49,326
155,118
420,515420,515

Consolidated Statements of Comprehensive Income(Thousands of yen)
End of previous fiscal year((January 1, 2019
to December 31, 2019)
Net income
Other comprehensive income
Foreign currency translation adjustment
Total other comprehensive income
Comprehensive income(Comprehensive income attributable to)Comprehensive income attributable to owners of theparentComprehensive income attributable to non-controllinginterests

8

End of current fiscal year
(January 1, 2020
to December 31, 2020)

429,382

420,515

1,173
1,173
430,556△210△210
420,304

430,556

420,304--

(3)Consolidated Statements of Shareholders’ Equity
Previous fiscal year (January 1, 2019, to December 31, 2019)(Thousands of yen)
Shareholders' equity
Paid-in Capital
Opening balance

Capital surplus

158,137

Retained earnings

808,967

919,822

Treasury stock△418

Total shareholders'equity1,886,509

Change during the year
Dividends
Net income attributable to owners of parent△142,550△142,550

429,382

429,382

Purchase of treasury stock

△195

△195

Net changes of items other thanshareholders' equity(Net)
Total changes during the period
Closing balance--

286,832△195

286,637

158,137

808,967

1,206,655△613

2,173,146

Other accumulated comprehensive income

Opening balance

Foreign currencytranslation
adjustment

Total
other
accumulatedcomprehensive
income11,021

11,021

Total net assets

1,897,531

Change during the year
Dividends△142,550

Net income attributable to owners of parent

429,382

Purchase of treasury stock
Net changes of items other thanshareholders' equity
(Net)

△195
1,173

1,173

1,173

Total changes during the period

1,173

1,173

287,810

Closing balance

12,194

12,1942,185,341

9

Current fiscal year (from January 1, 2020 to December 31, 2020)(Thousands of yen)
Shareholders' equity
Paid-in Capital
Opening balance

Capital surplus

158,137

808,967

5,392

5,392

Retained earnings
1,206,655

Treasury stock△613

Total shareholders'equity2,173,146

Change during the year
Issuance of new shares (exercise ofsubscription rights to shares)
Dividends
Net income attributable to owners of parent

10,785△131,143△131,143

420,515420,515

Purchase of treasury stock
Disposal of treasury stock

20,860△112,127△112,127

54,57775,438Net changes of items other thanshareholders' equity(Net)
Total changes during the period
Closing balance

5,392

26,253289,372△57,550

263,468

163,530

835,220

1,496,027△58,1632,436,614

Other accumulated comprehensive income

Opening balance

Foreign currencytranslation
adjustment

Total
other
accumulatedcomprehensive
income12,194

12,194

Total net assets

2,185,341

Change during the year
Issuance of new shares (exercise ofsubscription rights to shares)

10,785

Dividends△131,143

Net income attributable to owners of parent

420,515

Purchase of treasury stock△112,127

Disposal of treasury stock

75,438Net changes of items other thanshareholders' equity
(Net)

△210

△210

△210

Total changes during the period

△210

△210

263,257

Closing balance

11,984

11,9842,448,598

10

(4)Consolidated Statements of Cash Flows(Thousands of yen)
End of previous fiscal year
(January 1, 2019
to December 31, 2019)
Net cash provided by (used in) operating activities
Income before income taxes
Depreciation and amortization
Share of investment (loss) of entities accounted forusing equity method (△: profit)
Increase (decrease) in accrued bonuses
Increase (decrease) in provision for directors' bonuses(△)
Increase (decrease) in allowance for doubtful accounts(△)
Interest income
Interest expenses
Decrease (△) in notes and accounts receivable-trade
Decrease (△) in operational investment securities
Increase (△) in notes and accounts payable-trade
Increase (decrease) in accounts payable-other (△)
OthersSubtotalInterest received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flow from investing activities
Purchase of property, plant and equipment
Purchase of intangible assets
Purchase of investment securities
Payment by 差入 of lease deposits
Proceeding by collection of lease deposits
Cash flow from investing activities
Cash flow from financing activities
Net increase (△) in short-term borrowings
Purchase of treasury stock
Cash dividends paid
Proceeds from exercise of stock options
Cash flow from financing activities
Effect of exchange rate change on cash and cash
equivalents
NET (DECREASE) INCREASE IN CASH AND CASH
EQUIVALENTS
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period11

End of current fiscal year
(January 1, 2020
to December 31, 2020)

635,703
33,628575,633
38,694△13,380△7,255△130,325△5,810△96,408△24,098△1,045

1,981

△55
727
180,824△250△147,993△23,379△42,201
395,84455△707△257,551
137,641△78
667△267,373
55,03040,75650,446132,016
590,60978△667△133,918
456,102△180,224△10,602△13,772
1,248△203,350△1,767△707△56,800△31△59,305△175,003△195△142,550△317,748△112,127△129,342
10,785△230,684

239

△246

△383,218

165,865

2,116,453
1,733,235

1,733,235
1,899,100

(5)Notes to Consolidated Financial Statements(Notes on the Going Concern Assumption)
Not applicable.
(Additional Information)(Accounting Estimate of the Impact of Infectious Disease of the COVID-19)
With respect to the status of the COVID-19, we make accounting estimates, such as the recoverability of deferred tax assets,based on currently available information, assuming that current conditions will continue for at least FY2021.
As a consequence, we are not aware of any material impact on the valuation of our accounting estimates; however, due tothe highly uncertain impact of the spread of the COVID-19, our financial condition and results of operations may be impacted
depending on the future.
(Segment Information, etc.)
Disclosure is omitted because the business segments of the Group are a single segment.
(Per Share Information)
End of previous fiscal year
(January 1, 2019
to December 31, 2019)

End of current fiscal year
(January 1, 2020
to December 31, 2020)

Net assets per share

JPY191.63

JPY213.05

Net income per share

JPY37.65

JPY36.89

Net income-diluted

JPY36.68

JPY36.05(NOTE)1.We conducted a 2-for-1 stock split on October 1, 2019, and a 2-for-1 stock split on January 1, 2021. Net assets per share,
net income per share and diluted net income per share are calculated as if this stock split had taken place at the
beginning of the previous fiscal year.
2. The basis for calculating net income per share and diluted net income per share is as follows:
End of previous fiscal year
(January 1, 2019
to December 31, 2019)

End of current fiscal year
(January 1, 2020
to December 31, 2020)

429,382

420,515--429,382

420,515

11,403,868

11,397,504--

Net income per share
Net income attributable to owners of parent(Thousands of yen)Amount not attributable to common stock(Thousands of yen)
Net income attributable to owners of parent
attributable to common stock (Thousands of yen)
Average number of shares of common stock
outstanding during the period (shares)
Net income-diluted
Adjustment of net income attributable to owners ofparent(Thousands of yen)
Increase in common stock (shares)(Stock acquisition rights (shares))
Explanation of residual stock not included in
calculation of diluted net income per share due to lackof dilutive potential

299,162(299,162)-12

264,812(264,812)-

(Significant Subsequent Events)(Stock Splits and Partial Amendment to the Articles of Incorporation)
In accordance with the resolution of the Board of Directors meeting held on November 12, 2020, we made the stock split
and partial amendments to the articles of incorporation.
1.Purpose of the stock split
Company aims to reduce the investment unit price for the Company's stock, increase the liquidity of the stocks, andexpand our investor base by implementing the stock split.
2.Outline of stock split(1)Method
On the record date of December 31, 2020 (effectively December 30, 2020 due to a holiday for the shareholder registryadministrator), the Company conducted a 2-for-1 stock split of the shares held by the shareholders as recorded in the
final shareholder register on that date.
(2)Increase in number of shares due to stock split
Number of shares issued before the stock split:

5,777,900 shares

Increased number of shares upon the split:
Total number of shares issued after the stock split:

5,777,900 shares
11,555,800 shares

Total number of shares issuable after the stock split:

45,648,000 shares(3)Schedule of the split
Announcement of record date

December 14, 2020

Record date
The Effective Date

December 31, 2020
January 1, 2021

(4)Impact on per share information
The impact on per share information is described in the relevant section.
3.Partial Amendment to Articles of Incorporation upon Share Split(1)Reason for amendment of the articles of incorporation
In accordance with the Article 184.2 of the Companies Act, the total number of shares issuable under Article 5 of the
Articles of Incorporation of the Company was amended as of January 1, 2021.
(2)Amendments to the Articles of Incorporation
Details of the changes are as follows.
(Underlined area indicates change.)
Current articles of incorporation

Amended articles of incorporation(Total Number of Shares Issuable)
Article 5 The total number of shares issuable of the(Total Number of Shares Issuable)
Article 5 The total number of shares issuable of theCompany shall be 22,824,000 shares.

Company shall be 45,648,000 shares.

(3)Schedule of Amendment to Articles of Incorporation
Effective date

January 1, 2021

4.Others(1)Change in the Amount of Stated Capital
There is no change in the amount of capital stock at the time of this stock split.
(2)Adjustment of exercise price of stock acquisition rights
As a result of the stock split, the exercise price per share of the stock acquisition rights to be exercised on or afterJanuary 1, 2021 shall be adjusted:
Date of resolution of theBoard of Directors
Stock acquisition rightMay 15, 201813

Exercise price before theadjustment
JPY150Exercise price after the
adjustment
JPY75