(Unaudited)

October 11, 2017
MORITO CO., LTD.
Financial Statement (Unaudited)
For the Third Quarter of the Fiscal Year ended November 30, 2017
(Translated from the Japanese original)
Corporate Information
Code：9837 Listings in First Section of the Tokyo Stock Exchange(URL http : www.morito.co.jp/english/index.html )Representative： Takaki Ichitsubo
Representative Director and President
Contact：
Kenji Kojima
Director, Executive Officer and General Manager of Control Division
Telephone: +81-6-6252-3551
Scheduled date of filing of Quarterly Report
Scheduled date of dividend payment:
Supplementary explanation material for quarterly financial results:
Presentation meeting for quarterly financial results:

October 13, 2017
NoneNoNo(Amounts rounded down)
1. Consolidated Financial Results for the Third Quarter of Fiscal Year 2017(December 1, 2016 throughAugust 31, 2017)(1) Consolidated Financial Results(Percentages indicate year-on-year changes)
Net sales
Operating income
Ordinary income
Net income%%%%
Millions of yen
Millions of yen
Millions of yen
Millions of yen
3Q of FY 201730,102
3.0
1,029
6.0
1,047
33.0
3,381
577.9
3Q of FY 2016
29,221 △9.7971 △21.4787 △43.6
498 △37.4(Note) Comprehensive income : 4,575million yen (－%) (3Q of FY 2017)2016)

3Q of FY 2017
3Q of FY 2016

Net income
Per shareYen
121.7417.51△1,702million yen (△166.6%) (3Q of FY

Fully diluted net
Income per share
Yen
121.70－(2) Consolidated Financial Position
Total assets
Millions of yen
3Q of FY 2017
43,183
FY 2016
40,853

Net assets
Millions of yen
32,302
29,260(Reference) Equity capital : 32,274million yen (3Q of FY 2017)

Equity ratio%
74.7
71.6

29,246 million yen (FY 2016)

2. Dividends

FY 2016
FY 2017
FY 2017(Forecast)(Note)

First
quarter-end
Yen－－

Dividends per share
SecondThird
Fiscalquarter-end
quarter-end year-end
Yen
Yen
Yen
8.00
9.00
－
14.00
－

14.00

Total(Annual)
Yen
17.00
28.00

Revision of consolidated earnings forecast to the latest announcement : None

(Unaudited)

3. Consolidated Forecast for FY 2017 (December 1, 2016 through November 30, 2017)(Percentages represent changes from corresponding period of previous year)
Net Sales
Millions ofyen%

Operatingincome
Millionsof yen%

Ordinary profit
Millions ofyen%

Net income
Millions ofyen

Net income
per share%

Yen

Full year
43,000 7.3
1,800 1.8
1,700 3.3
3,000
154.0
105.44(Note) Revision of consolidated earnings forecast to the latest announcement : None

*Notes(1) Changes of important subsidiaries during the period (changes of specific subsidiaries in accordance withchanges in the scope of consolidation) : None
Newly included : None
Extended company : None
(2) Adoption of special accounting treatment for preparing quarterly consolidated financial statements: None
(3) Changes in accounting policies and changes or restatement of accounting estimates(i)
Changes in accounting policies caused by revision of accounting standards :None(ii)
Changes in accounting policies other than (i) :Yes(iii)
Changes in accounting estimates :None(iv)
Restatements :None(Note) For details, please refer to ‘Matters Concerning Summary Information (Note) (3) Changes in accounting
policy, Changes in accounting estimates and Revision restated’ on page 6.
(4) Number of outstanding shares (common shares）(i) Number of outstanding shares, including treasury shares at end of period:
30,800,000 shares(as of August 31, 2017)30,800,000 shares(as of November 30, 2016)(ii) Number of shares of treasury stock at end of period:
3,300,100shares(as of August 31, 2017)
2,349,000 shares(as of November 30, 2016)(iii) Average outstanding number of shares during the period:
27,778,878 shares(The 3Q of FY 2017)28,497,136 shares(The 3Q of FY 2016)*This financial summary does not need to undergo an audit.
*Disclosure and other special notes regarding performance forecasts
The forecast in this statement is based on information available to management as of the date on which these
performance-related figures were disclosed, and various factors may cause actual results to differ from theseforecasts. For issues to keep in mind when using the forecasts and criteria conditioned upon the forecasts, pleaserefer to “1. Qualitative Information for the Period under Review (2) Forecast of Consolidated Business Resultsand Other Forward-looking Information.” on page 5. We have also introduced “Stock Granting Trust (J-ESOP)”
and “Board Incentive Plan (BIP)”. Consequently, the shares held by Trust and Custody Service Bank, ltd. and TheMaster Trust Bank of Japan, ltd. are included in the treasury shares.

(Unaudited)Index
1. Qualitative Information for the Period under Review ......................................................................................4(1) Business Performance .....................................................................................................................................4(2) Forecast of Consolidated Business Results and Other Forward-looking Information .....................................5
2. Matters Concerning Summary Information ......................................................................................................6(1) Changes in Important Subsidiaries during the period under Review ..............................................................6(2) Adoption of Special Accounting Treatment for Preparing Quarterly Consolidated Financial Statement .........6(3) Changes in Accounting Policies, Changes in Accounting Estimates and Revision Restated .........................6(4) Additional Information .......................................................................................................................................63. Quarterly Consolidated Financial Statements .................................................................................................7(1) Quarterly Consolidated Balance Sheets ..........................................................................................................7(2) Quarterly Consolidated Statements of Income and Consolidated Statements of Comprehensive Income ....9(3) Notes regarding Quarterly Consolidated Financial Statements..................................................................... 11[Notes on assumption of going concern]........................................................................................................ 11[Notes on a Significant Change in Shareholders’ Equity] .............................................................................. 11[Segment Information] .................................................................................................................................... 11

(Unaudited)

1. Qualitative Information for the Period under Review(1) Business Performance
In the Third quarter (From 1st December, 2016 to 31st August, 2017) of the fiscal year ended November 30th,
2017, the Japanese economy has shown signs of modest recovery by improving employment situation andcapital investment because corporate performance has continued stable.
In the global economy, it was stable due to mainly driven by China and emerging country, although politicaluncertainty in the US was increased, EU economy was uncertain due to Brexit, and a volatile internationalsituation in Asia was increased.
In such a situation, our group is accelerating a growth strategy by the development of value-added Japanese
items, expansion of a global sales channel under 7th mid-term management plan, and will promote therealization of value creation which the era seeks, expand our business in not only existing market such ASEAN,china, western, but also in untapped market.
As a result, in the current quarterly performance reaches net sales ¥30,102million (increased by 3.0% from ayear earlier), operating income ¥1,029 million (increased by 6.0% from a year earlier), ordinary income ¥1,047
million (increased by 33.0% from a year earlier), net income ¥3,381 million (increased by 577.9% from a yearearlier).
The exchange rate used for the oversea subsidiaries’ consolidated financial statement of the current quarterend as below:
USD
EUR
RMB
HKD
TWD
VND
THB

1Q Oct-Dec
109.43 (120.54)
117.86 (131.67)
15.99 (18.34)
14.11 (15.55)
3.45 (3.68)
0.0048 (0.0053)
3.09 (3.35)

2Q Jan-Mar
113.61 (112.69)
121.04 (127.57)
16.56 (17.39)
14.64 (14.53)
3.66 (3.50)
0.0050 (0.0050)
3.24 (3.20)

3Q Apr-Jun
111.10 (102.96)
122.26 (114.36)
16.21 (15.46)
14.27 (13.27)
3.67 (3.19)
0.0048 (0.0046)
3.24 (2.93)*() is the exchange rate of FY2016.
*We have changed the method which is that Income and Expense in overseas subsidiaries has been converted
by average number of exchange rate into Japanese yen is applied from the first quarter of this fiscal year.
Please refer to “2. Matters Concerning Summary Information, (3) Changes in accounting policy, Changes inaccounting estimates and Revision restated” on page 6.
Segment information as below[Japan]As for the apparel division, sales of the accessories for sports apparel manufacturer which was strong in same
period a year earlier was decreased, however sales of the accessories for ladies wear, uniform/working wear
and mass retailer were increased.
In the consumer product division, sales of the accessories for shoes and video equipment were decreased,
but sales of accessories for health-related items, automobile interior components, rental and cleanup of kitchen
supplies were increased.
As a result, net sales were ¥20,617 million (increased by 1.3% from a year earlier).
[Asia]
As for the apparel division, sales of the accessories for EU and the US apparel manufacturers in Hong Kong
were decreased, however sales of the accessories for Japanese apparel manufacturers in Shanghai wasincreased.
In the consumer product division, sales of accessories for video equipment in Thailand was decreased, but
sales of accessories for video equipment in Hong Kong and sales of the automobile interior component forJapanese auto makers in Shanghai were increased.
As a result, net sales were ¥5,235 million (increased by 9.8% from a year earlier) including effect of Japan yendepreciation.
4

(Unaudited)[Europe and the U.S.]
As for the apparel division, sales of the accessories for EU and the US were increased.
In the consumer product division, sales of automobile interior article for Japanese auto maker in the US andsales of the accessories for video equipment were decreased, however sales of automobile interior article forJapanese auto maker in Europe was increased.
As a result, net sales were ¥4,249 million (increased by 3.5% from a year earlier) including effect of Japan yen
depreciation.
(2) Forecast of Consolidated Business Results and Other Forward-looking Information
Currently, there has been no change in the consolidated forecast of FY2017.

5

(Unaudited)

2. Matters Concerning Summary Information(1) Changes in Important Subsidiaries during the period under Review
Not applicable(2) Adoption of Special Accounting Treatment for Preparing Quarterly Consolidated Financial Statement
Not applicable.
(3) Changes in Accounting Policies, Changes in Accounting Estimates and Revision Restated
Changes in the method of foreign currency conversion for Income and Expense in overseas subsidiaries
Income and Expense in overseas subsidiaries has been converted by an exchange rate as of accounting dateinto Japanese yen up to now. However, the method, which is that Income and Expense in overseas subsidiaries
has been converted by average number of exchange rate into Japanese yen, is applied from the first quarter ofthis fiscal year. The purpose for this change was to take a financial result of overseas subsidiaries more
appropriately in consolidated accounting, because it will be becoming more important for consolidatedaccounting.
As a result, retroactive application was not implemented since the effect on the Third quarter of previous year
and the term to beginning of this fiscal year caused by this change was minor.
(4) Additional Information
Application of Implementation Guidance on Recoverability of Deferred Tax Assets
Implementation Guidance on Recoverability of Deferred Tax Assets (ASBJ Statement No.26 of March 28, 2016),
have been applied from the first quarter of the fiscal year under review.

6

(Unaudited)

3. Quarterly Consolidated Financial Statements(1) Quarterly Consolidated Balance Sheets
FY 2016(As of November 30, 2016)
Thousands of yen

FY 2017(As of August 31, 2017)
Thousands of yen

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable

9,442,122
10,583,460

12,202,953
10,068,742

Inventory

4,034,245

4,674,042

Other current assets
Allowance for doubtful accounts
Total current assets

1,097,177△29,950
25,127,055

812,776△30,806
27,727,708

Land
Other tangible fixed assets

3,224,579
3,151,432

2,567,574
3,176,980

Total tangible fixed assets
Intangible fixed assets
Goodwill6,376,011

5,744,555

3,000,353

3,090,245

Other Intangible fixed assets
Total intangible fixed assets
Investments and other fixed assets

1,239,174
4,239,528

1,293,200
4,383,445

Investment securities

4,055,364

4,250,804

Net defined benefit asset
Other fixed assets
Allowance for doubtful account221,830
890,628△74,988

223,417
908,966△70,190

Fixed assets
Tangible fixed assets

Total investments and other fixed assets

5,092,834

5,312,998

15,708,375
18,205

15,440,998
15,05440,853,636

43,183,762

4,262,005180,000

4,299,641
130,000

Current portion of bonds

400,000

400,000

Current portion of long-term debt
Accrued tax payable
Reserve for bonuses
Reserve for director’s bonuses

375,396379,220
175,722
79,232

254,930
505,877
266,565
69,882Other current liabilities
Total current liabilities
Fixed liabilities

1,465,489
7,317,066

995,228
6,922,125

Bonds payable
Long-term debt

1,400,000
161,081

1,200,000

Total fixed assets
Deferred assets
Total assets
Liabilities
Current liabilities
Notes and accounts payable
Short-term loans payable

Provision for retirement benefit by stock

17,375－24,773

Provision for director’s retirement benefit
Provision for director's retirement benefit by stock
Provision for environmental measures
Net defined benefit liability

30,43335,05918,133918,02138,53347,88920,084
912,870

1,695,603
4,275,706
11,592,772

1,714,528
3,958,679
10,880,805

Other fixed liabilities
Total fixed liabilities
Total liabilities

7

(Unaudited)

FY 2016(As of November 30, 2016)
Thousands of yen

FY 2017(As of August 31, 2017)
Thousands of yen

Net Assets
Shareholders' equity
Capital3,532,492

3,532,492

Capital surplus

3,498,724

3,498,724

Retained earnings
Treasury stock

23,966,197△1,230,960

24,789,600△2,122,115

Total shareholders’ equity

29,766,453

29,698,701

1,336,046

1,440,480

Other comprehensive income
Valuation difference on available-for-sale securities

861△4,779Difference in revaluation of land
Foreign currency translation adjustment△1,280,438△463,484

621,625
604,759

Remeasurement of defined benefit plans△112,982△86,439

Total other comprehensive income△519,998

2,575,645

14,40828,609－29,260,863－
32,302,956

40,853,636

43,183,762

Deferred gains or losses on hedges

Subscription rights to shares
Minority interests
Total net assets
Total liabilities and net assets

8(Unaudited)(2) Quarterly Consolidated Statements of Income and Consolidated Statements of Comprehensive
IncomeQuarterly Consolidated statements of income
The Third Quarter accounting period
FY 2016
FY 2017(December 1, 2015 through (December 1, 2016 throughAugust 31, 2016)
August 31, 2017)
Thousands of yen
Thousands of yen
Net sales

29,221,515

30,102,502

Cost of sales

21,553,440

22,023,035

Gross profit

7,668,075

8,079,466

Total selling, general and administrative expense

6,696,191

7,049,481

971,883

1,029,985

Interest received
Dividends received

17,80057,87918,39650,893

Rent on real estate

58,38137,083Equity in earnings of affiliates
Other non-operating income

43,51930,534

33,10937,694

Total non-operating income

208,115

177,177

Operating Income
Non-operating income

Non-operating expenses
Interest paid

12,598

4,813

Cash discount on sales65,177

63,304Foreign Exchange Loss
Others non-operating expense

235,507
79,180

11,22980,131

Total non-operating expense

392,463

159,478

787,535

1,047,684

Gains on sales of fixed assets

7,365

3,291,825

Gains on sales of investment securities
Gains on liquidation of affiliates

24,254
15,903－

Total extra ordinary income

47,523－
3,291,825

Extra ordinary loss
Loss on sales of fixed assets

11,644

3,075

2,025
－

53,48857,270Loss of business restructuring－

18,097

Loss on golf membership rights－
13,669821,389

132,6314,206,878

514,119△191,611

804,400
20,706

Ordinary Income
Extra ordinary income

Loss on disposal of fixed assets
Impairment loss

Total extra ordinary loss
Net income before taxes and other adjustment
Corporate, inhabitant and business taxes
Adjustments to corporate and other taxes

700

Total income taxes

322,507825,107

Net income
Profit(Loss) attributable to non-controlling interests

498,881

3,381,770－498,881－
3,381,770

Profit(Loss) attributable to owners of parent9(Unaudited)
FY 2016Net Income
Other comprehensive income
Unrealized gain(loss) on available-for-sale securities
Deferred gains or losses on hedges
Land revaluation difference amountForeign currency translation adjustment
Adjustments to retirement benefit
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attribute to the parent
Comprehensive income attribute to the minority shareholders

10FY 2017(December 1, 2015 throughAugust 31, 2016)
Thousands of yen
498,881(December 1, 2016 throughAugust 31, 2017)
Thousands of yen
3,381,770△467,436△3,89020,050△1,726,278△24,021△2,201,576△1,702,695104,433△5,640－1,068,243
26,543
1,193,580
4,575,350△1,702,695

4,575,350－－

(Unaudited)(3) Notes regarding Quarterly Consolidated Financial Statements[Notes on assumption of going concern]
Not applicable.
[Notes on a Significant Change in Shareholders’ Equity]
Not applicable.
[Segment Information]
1. The Third quarter of FY 2016 (December 1, 2015 through August 31, 2016)(1) The information on net sales, income or loss by reportable segment
Reportable Segment

Net Sales
Sales to externalcustomers
Inter segment sales
and transfer
Total
Segment income(Thousands of yen)
Consolidated
Adjustment
Statement(Note 1)
Amount(Note 2)

JapanAsia

EU and US

Total

20,344,393

4,769,977

4,107,143

29,221,515－

29,221,515

1,747,294

1,385,063

41,692

3,174,050△3,174,050－

22,091,688
680,640

6,155,041
260,891

4,148,836
230,358

32,395,566
1,171,889△3,174,050△200,006

29,221,515
971,883(Notes)1. Adjustment of ¥△200,006 thousand includes ¥△237,378 thousand -corporate expenses that are not distributed
to each reportable segment and other ¥37,372 thousand.
2. The amounts for income or losses in the reportable segments were subsequently adjusted with the amount ofoperating income on the quarterly consolidated profit and loss statement.

(2) The information on impairment loss for fix asset and goodwill by reportable segment
Not applicable

2. The Third Quarter of FY 2017 (December 1, 2016 through August 31, 2017)(1) The information on net sales, income or loss by reportable segment
Reportable Segment

Net Sales
Sales to externalcustomers
Inter segment sales
and transfer
Total
Segment income(Thousands of yen)
Consolidated
Adjustment
Statement(Note 1)
Amount(Note 2)

JapanAsiaEU and US

Total

20,617,370

5,235,656

4,249,475

30,102,502－

30,102,502

1,705,316

1,856,960

59,3203,621,597△3, 621,597－

22,322,687
770,297

7,092,617
296,619

4,308,795
207,248

33,724,099
1,274,165△3, 621,597△244,176

30,102,502
1,029,985(Notes)1. Adjustment of ¥△244,179 thousand includes ¥△234,515 thousand-corporate expenses that are not distributed
to each reportable segment and other ¥△9,664 thousand.
2. The amounts for income or losses in the reportable segments were subsequently adjusted with the amount ofoperating income on the consolidated profit and loss statement.

(2) The information on impairment loss for fix asset and goodwill by reportable segment(Impairment loss on fix asset)
In Japan segment, ¥57,270 thousand for impairment loss on land as idle assets was booked in the third
quarter of FY2017 (December 1, 2016 through August 31, 2017).
11