DAIICHIKOSHO

CO.,

LTD.

Translation
This report is a translation excerpts from original Japanese Flash Report and for reference purpose only. In case of discrepancy between this report andoriginal Japanese Flash Report, the later shall prevail.

FY2016, the year ending March 31, 2017

Flash Report on the Consolidated Results for the Third Quarter Ended
December 31, 2016 [JGAAP]
February 10, 2017

Company Name:
DAIICHIKOSHO CO., LTD.
Stock Exchange Listing: Tokyo Stock Exchange
Code Number:
7458
URL:
http://www.dkkaraoke.co.jp/
Representative:
Saburo Hayashi, President
Contact:
Shigeki Kobayashi,
Corporate Officer and General Manager, Accounting Department
Phone:+81-3-3280-2151
Scheduled Date to Submit the Quarterly Securities Report: February 14, 2017
Start Date for Dividend Payment: －Availability of Supplementary Briefing Material on Quarterly Financial Results: None
Schedule of Quarterly Financial Results Briefing Session: None
(Amounts below one million yen are truncated.)

1. Consolidated Performance for the Nine Months Ended December 31, 2016 (From April 1, 2016,
to December 31, 2016)(1) Consolidated operating results(Percentage figures indicate increase/decrease from a year earlier.)
Net sales

Operating income

Ordinary income

Millions of yen%

Millions of yen%

Millions of yen%

105,639(0.9)

15,931

1.9

17,656

5.6

106,645

7.6

15,6293.0

16,7190.0

Nine months ended
December 31, 2016
Nine months ended
December 31, 2015

Net income attributable toowners of parent
Millions of yen

Fully diluted net income
per share

Basic earnings per share%

Nine months ended
9,053(11.3)
December 31, 2016
Nine months ended
10,201
1.4
December 31, 2015
(Note) Comprehensive income:
12,217million yen
Nine months ended December 31, 2016:
Nine months ended December 31, 2015:
8,569million yen

Yen

Yen

157.41

157.30176.62176.5642.6 %(16.7)%(2) Consolidated financial position
Total assets

Net assets

Millions of yen

As of December 31, 2016
As of March 31, 2016
(Reference) Shareholders’ equity:
As of December 31, 2016:
As of March 31, 2016:%

117,352
112,75462.7
62.0

184,718
179,641
115,895million yen
111,402million yen

1Equity ratio

Millions of yen

DAIICHIKOSHO

CO.,

LTD.

2. DividendYear ended March 31, 2016
Year ending March 31, 2017

Annual dividend
Third Quarter

First Quarter

Second Quarter

Yen

Yen

Yen

－
－

54.00
54.00

－
－

Year-end

Year ending March 31,2017 (forecast)(Note) Changes in dividends forecast from most recently announced figures: None

Annual

Yen

Yen

54.00

108.0054.00

108.003. Forecast Consolidated Performance for FY2016, the Year Ending March 31, 2017
(From April 1, 2016, to March 31, 2017)
Net salesYear ending March 31,2017 (full year)(Percentage figures indicate increase/decrease from a year earlier.)
Operating income
Ordinary income

Millions of yen%

Millions of yen%

Millions of yen%

142,200

0.6

19,000(4.5)

20,400(3.4)

Net income attributable toowners of parent
Millions of yen

Basic earnings per share%

Yen

Year ending March 31,
10,100(19.8)
176.482017 (full year)(Note) Changes in forecast of consolidated operating results from most recently announced figures: None

*Notes(1) Significant changes in subsidiaries during the period under review (changes to specific subsidiaries resulting
from changes in scope of consolidation): None
(2) Adoption of special accounting policies for quarterly financial statements: None
(3) Changes in accounting standard, accounting estimation change and error correction
1) Changes due to changes in accounting standard: Yes
2) Changes due to changes in accounting standard except (3) 1): None
3) Changes due to accounting estimation change: None
4) Error correction: None
(4) Number of common shares issued
1) Number of shares issued
As of57,434,200 As of
57,634,200(including treasury stock)
December 31, 2016
Shares March 31, 2016
shares2) Number of shares ofAs of203,168 As of
3,070
treasury stock
December 31, 2016
Shares March 31, 2016
shares3) Average number of shares
Nine months ended
57,516,856 Nine months ended
57,761,082
during the period
December 31, 2016
Shares December 31, 2015
shares* Presentation regarding the implementation status of the quarterly review:
This flash report on the consolidated results for the Three months is not covered by the quarterly review procedure
stipulated in the Financial Instruments and Exchange Act. At the time of the publication of this report, the quarterly
review procedure for quarterly consolidated financial statements is being implemented.
* Explanation for the appropriate use of performance forecasts and other special notes:
The statements regarding forecast of financial results in this report are based on the information that is available, as
well as estimates, assumptions and projections that are believed to be reasonable at the time of publication.
Therefore, there might be cases in which actual results greatly differ from forecast values.

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DAIICHIKOSHO

CO.,

LTD.

Quarterly Consolidated Financial Statements(1) Quarterly Consolidated Balance Sheets(Millions of yen)

FY2015(As of March 31, 2016)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade
Securities
Inventories
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Karaoke equipment for rental, net
Karaoke cabin and restaurant facilities, net
Land
Other, net
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Lease and guarantee deposits
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

3

Current Third quarter(As of December 31,
2016)

51,478
7,113
1,007
6,243
6,263
(149)
71,95657,010
6,489
－
6,485
6,424
(176)
76,234

10,943
19,112
31,595
5,995
67,646

11,441
19,47836,781
7,278
74,980

1,882
5,971
7,853

1,554
5,763
7,317

9,997
14,2507,972(36)
32,184
107,684
179,641

5,030
14,4306,760(35)
26,186
108,484
184,718

DAIICHIKOSHO

CO.,

LTD.

(Millions of yen)

FY2015(As of March 31, 2016)
Liabilities
Current liabilities
Notes and accounts payable-trade
Short-term loans payable
Current portion of bonds
Income taxes payable
Provision for bonuses
Other
Total current liabilities
Non-current liabilities
Bonds payable
Long-term loans payable
Provision for directors' retirement benefits
Net defined benefit liability
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Revaluation reserve for land
Foreign currency translation adjustment
Remeasurements of defined benefits plans
Total accumulated other comprehensive income
Subscription rights to shares
Non-controlling interests
Total net assets
Total liabilities and net assets

4

Current Third quarter(As of December 31,
2016)

4,048
4,201
－
3,237
1,086
11,14523,718

4,519
4,801
3,500
1,519
1,042
11,77027,152

10,00023,362
1,263
5,398
3,143
43,16866,886

6,500
23,638
1,030
5,737
3,307
40,21367,366

12,350
4,001
98,329(13)
114,668

12,350
4,003
100,587(895)
116,046(2,074)
(733)
108
(566)
(3,265)
81
1,270
112,754
179,641

1,047
(733)
23
(487)
(150)
155
1,301
117,352
184,718

DAIICHIKOSHO

CO.,

LTD.

(2) Quarterly Consolidated Statements of Income and Comprehensive Income(Quarterly Consolidated Statements of Income)(Millions of yen)

Nine months ended
December 31, 2015
(From April 1, 2015, toDecember 31, 2015)
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Cooperative monetary aid received
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of non-current assets
Gain on acquisition of non-current assets
Gain on sales of investment securities
Total extraordinary income
Extraordinary losses
Loss on disposal of non-current assets
Impairment loss
Loss on sales of investment securities
Loss on valuation of investment securities
Total extraordinary losses
Income before income taxes and minority interests
Income taxes-current
Income taxes-deferred
Total income taxes
Net income
Net income attributable to non-controlling interests
Net income attributable to owners of parent

5

Nine months ended
December 31, 2016
(From April 1, 2016, toDecember 31, 2016)

106,645
65,151
41,49325,864
15,629105,639
64,491
41,14725,215
15,931

595
246
－
786
1,629

251
276
792
788
2,109

255
96
186
539
16,719

250
－
134
384
17,656

22
－
－
22

4
370
4
379

192
248
－
－
441
16,300
6,041
14
6,056
10,24443
10,201

304
126
8
3,305
3,744
14,291
5,086
101
5,188
9,103
49
9,053

DAIICHIKOSHO

CO.,

LTD.

(Quarterly Consolidated Statements of Comprehensive Income)(Millions of yen)

Nine months ended
December 31, 2015
(From April 1, 2015, toDecember 31, 2015)
Net income
Other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of theparentComprehensive income attributable to non-controllinginterests

6

Nine months ended
December 31, 2016
(From April 1, 2016, toDecember 31, 2016)10,244

9,103(1,688)(55)
69(1,674)
8,569

3,121
(85)
78
(3,114)
12,217

8,526

12,16843

49

DAIICHIKOSHO

CO.,

LTD.

(3) Segment Information
Nine months ended December 31, 2015 (From April 1, 2015, to December 31, 2015)
Reportable segments
Other

Total

(Millions of yen)
Postedamount to the
Adjusted
consolidated
amountquarterly(Note)
statements ofincomeCommercial
karaokeKaraokecabin and
restaurantMusic
softwareSubtotal

Sales

51,95843,070

6,398

101,426

5,218

106,645－

106,645

Segment income(Operating income)

11,0775,757

18

16,853

1,132

17,985(2,356)

15,629(Note) The (2,356) million yen adjustment posted to Segment income is primarily composed of General and
Administrative Expenses incurred from the administrative department at the head office that are not attributable toany particular segment.

Nine months ended December 31, 2016 (From April 1, 2016, to December 31, 2016)
Reportable segments
Other

Total

(Millions of yen)
Postedamount to the
Adjusted
consolidated
amountquarterly(Note)
statements ofincomeCommercial
karaokeKaraokecabin and
restaurantMusic
softwareSubtotal

Sales

50,44842,906

6,599

99,953

5,685

105,639－

105,639

Segment income(Operating income)

11,4285,754

28

17,211

1,132

18,344(2,412)

15,931(Note) The (2,412) million yen adjustment posted to Segment income is primarily composed of General and
Administrative Expenses incurred from the administrative department at the head office that are not attributable toany particular segment.

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DAIICHIKOSHO

CO.,

LTD.

(4) Issues Related to Summary Information (Notes)
Changes to Accounting Policies, Changes to Accounting Estimates, and Revision Restatements(Revised Implementation Guidance on Recoverability of Deferred Tax Assets)
From the first quarter, the Company has applied the “Revised Implementation Guidance on Recoverability of Deferred Tax
Assets” (Accounting Standards Board of Japan (ASBJ) Accounting Statement No.26 of March 28, 2016; hereinafter called
the “Revised Implementation Guidance on Recoverability”), and has revised the part of accounting method regard to therecoverability of deferred tax assets.
For an application Revised Implementation Guidance on Recoverability, adhere to the transitional handling prescribed in
the paragraph 49(4) of the Implementation Guidance on Recoverability, and the difference between the amount of deferred
tax assets in case where has applied the paragraph 49(3)1to3 of the Implementation Guidance on Recoverability as of the
beginning of the first quarter and the amount of deferred tax assets at the previous fiscal year-end has added to retained
earnings at the beginning of the first quarter.
As a result, deferred tax assets included in Investments and other assets, and Retained earnings at the beginning of the firstquarter increased by 228 million yen respectively.

(The change in depreciation method due to Tax Reform 2016)
Accompanying revised in Corporate Tax Law, has applied the "Practical Solution on a change in depreciation method due
to Tax Reform 2016" (Practical Issues Task Force No.32 of June 17, 2016) from the first quarter.
Depreciation method pertaining to facilities attached to buildings and structures, which acquire on or after April 1, 2016,
have changed to the straight - line method from the declining - balance method.
This change in accounting policy has minimal impact on profit and loss for the period under review.

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