DAIICHIKOSHO

CO.,

LTD.

FY2010, the year ended March 31, 2011

Flash Report on the Consolidated Results for the Year Ended March 31, 2011
[JGAAP]May 13, 2011

Company Name:
DAIICHIKOSHO CO., LTD.
Stock Exchange Listing: Osaka (JASDAQ)
Code Number:
7458
URL:
http://www.dkkaraoke.co.jp
Representative:
Tadahiko Hoshi, Chairman and CEO
Contact:
Shigeki Kobayashi,
General Manager, Accounting Department, Administration Headquarters
Phone:+81-3-3280-2151
Date of the Ordinary General Meeting of Shareholders: June 24, 2011
Start Date for Dividend Payment:
June 27, 2011
Scheduled Date to Submit the Securities Report:
June 27, 2011
Availability of Supplementary Briefing Material on Financial Results: Available
Schedule of Financial Results Briefing Session: None
(Amounts below one million yen are truncated.)

1. Consolidated Performance for the Year Ended March 31, 2011 (From April 1, 2010, to March 31,
2011)(1) Consolidated operating results(Percentage figures indicate increase/decrease from a year earlier.)
Net sales
Millions of yen

Year ended March 31, 2011
Year ended March 31, 2010

127,885
125,300

Operating income
Ordinary income% Millions of yen% Millions of yen%
2.1
16,510(5.3)
17,457(5.2)
0.2
17,4394.7
18,4085.4

Net income

Net income per share

Millions of yen%
Year ended March 31, 2011
9,590
(10.6)
Year ended March 31, 2010
10,725(1.5)
Note: Comprehensive income:Year ended March 31, 2011: 9,908 million yen (10.3%)
Year ended March 31, 2010: 11,051 million yen ―%Return on equity

Yen
147.26160.17

Ordinary income to total
assets%%Year ended March 31, 2011
11.3
13.3
Year ended March 31, 2010
13.3
14.7
(Reference) Equity in net income of unconsolidated subsidiaries and affiliates:
Year ended March 31, 2011: (35) million yen
Year ended March 31, 2010: (53) million yen

1

Fully diluted net income
per share
Yen――

Operating income to net
sales
%
12.9
13.9

DAIICHIKOSHO

CO.,

LTD.

(2) Consolidated financial position
Total assets

Net assets

Millions of yen

Millions of yen

Year ended March 31, 2011
137,447
Year ended March 31, 2010
125,776(Reference) Shareholders’ equity:Year ended March 31, 2011: 87,083 million yen
Year ended March 31, 2010: 83,226 million yen

88,03484,054Equity ratio
%
63.4
66.2

Net assets per share
Yen
1,356.06
1,263.54(3) Consolidated cash flows

Year ended March 31, 2011
Year ended March 31, 2010

Cash flows fromoperating activities

Cash flows frominvesting activities

Cash flows fromfinancing activities

Cash and cash
equivalents at theend of the year

Millions of yen

Millions of yen

Millions of yen

Millions of yen

19,34331,141(28,213)(14,116)

1,626(12,754)

26,57333,877First Quarter—―

Second Quarter
Yen
20.00
25.00

―

―

2. DividendYear ended March 31, 2010
Year ended March 31, 2011
Year ending March 31,
2012 (forecast)Aggregate amount ofdividend (total)

Annual dividend
Third Quarter――

Year-end
Yen
30.00
30.00

―

―

Payout ratio (consolidated)

Total
Yen
50.00
55.00
―

Ratio of dividends to net
assets (consolidated)
%
4.1
4.2

Millions of yen%
Year ended March 31, 2010
3,309
31.2
Year ended March 31, 2011
3,551
37.3
Year ending March 31,―
2012 (forecast)
Note: Dividends forecast for FY2011, the year ending March 31, 2012 has not yet been determined.

3. Forecast Consolidated Performance for FY2011, the Year Ending March 31, 2012 (From April 1,
2011, to March 31, 2012)
Due to the influence of the Great East Japan Earthquake that occurred on March 11, 2011, the forecast of performancefor the year ending March 31, 2012 has not yet been determined and not stated in the financial results as it is difficult
to disclose the forecast at the time of the announcement of the financial results.

4. Other(1) Change in important subsidiaries during the period under review (Change in specific subsidiaries causing achange in the scope of consolidation): No(2) Change in accounting principles, procedure and presentation methods
1) Changes following a revision of accounting standards: Yes
2) Other changes: No(3) Number of common shares issued
1) Number of shares issued
Year ended
64,220,596 Year ended
66,670,596(including treasury stock)
March 31, 2011
shares March 31, 2010
shares2) Number of shares of treasury
Year ended
2,813 Year ended
802,735stock
March 31, 2011
shares March 31, 2010
shares3) Average number of sharesYear ended
65,123,736 Year ended
66,962,701
during the period
March 31, 2011
shares March 31, 2010
shares2

DAIICHIKOSHO

CO.,

LTD.

(Reference) Outline of Nonconsolidated Financial Results
Nonconsolidated Performance for the Year Ended March 31, 2011 (From April 1, 2010, to March 31,
2011)(1) Nonconsolidated 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%
Year ended March 31, 2011
86,883
3.9
10,479(7.3)
11,851(6.1)
Year ended March 31,2010
83,5880.9
11,30714.3
12,62810.7
Net income
Millions of yen

Year ended March 31, 2011
Year ended March 31, 2010

6,627
8,592

Net income per share%(22.9)
23.6

Yen
101.77128.32

Fully diluted net income
per shareYen——(2) Nonconsolidated financial position
Total assets
Millions of yen

Net assets
Millions of yen

Year ended March 31, 2011
93,675
Year ended March 31, 2010
82,617(Reference) Shareholders’ equity:Year ended March 31, 2011: 59,715 million yen
Year ended March 31, 2010: 58,730 million yen

59,71558,730Equity ratio
%
63.8
71.1

Net assets per share
Yen
929.89891.64* Presentation regarding the implementation status of the audit procedure:This flash report on the consolidated results is not covered by the audit procedure stipulated in the Financial
Instruments and Exchange Act. At the time of the publication of this report, the audit procedure for 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.

3

DAIICHIKOSHO

CO.,

LTD.

(Attachment)

Corporate GroupThe Daiichikosho Group (“DKG”) consists of Daiichikosho Co., Ltd. (“DK” or “the company”), 40
consolidated subsidiaries and 1 affiliate. The major group companies engage in sales and rental ofcommercial-use karaoke equipment, supply of sound source and video content for communication
karaoke, operation of karaoke cabins and restaurants, and production and sales of music and video
software products.
Business segment

Business line

Commercial
karaoke

Sales and rental of commercial-use
karaoke equipment and supply ofsound source and video content forcommunication karaoke

Karaoke cabin
and restaurant

Operation of karaoke cabins andrestaurants

Music software

Production and sales of music andvideo software products

Other

Satellite broadcasting, supply ofcontent services via mobile phone andreal estate lease and rental, etc.

4

Domestic

Overseas

Daiichikosho Co., Ltd.,
Hokkaido Daiichikosho Co., Ltd.,
Tohoku Daiichikosho Co., Ltd.,
Taito Daiichikosho Co., Ltd.,
Niigata Daiichikosho Co., Ltd.,
Tokai Daiichikosho Co., Ltd.,
Daiichikosho Kinki Co., Ltd.,
Kyushu Daiichikosho Co., Ltd.,and 19 other subsidiaries
Daiichikosho Co., Ltd.,
Nippon Crown Co., Ltd.,
Tokuma Japan Communications Co.,Ltd.,
CROWN TOKUMA music
distribution Co., Ltd.,
Union Eiga Co., Ltd.,and 4 other subsidiaries
Daiichikosho Co., Ltd.,DK Finance Co., Ltd.,and Maruhagi Yoshu Kogyo Co., Ltd.

DK KOREA
Co., Ltd.,
Daiichikosho(Shanghai), Ltd.,and 1 othersubsidiary

D.K. Enterprises(Guam), Inc.

DAIICHIKOSHO

CO.,

LTD.

The following diagram schematically shows the relationships of the respective group companies and businesses.

(Overseas subsidiaries)(Domestic sales subsidiaries)

DAIICHIKOSHO CO., LTD. (Reporting company)

Domestic users(Intermediary services related to
installment sales and loans for
DK and group companies)
DK Finance Co., Ltd.
(Operation of karaoke cabins)*BESTa FOODS Co., Ltd.
(Production and sales of music
software products)
Nippon Crown Co., Ltd.
Tokuma Japan Communications
Co., Ltd.
CROWN TOKUMA music
distribution Co., Ltd.
Tri-M, Inc.
DK Music Publishing Co., Ltd.
Union Eiga Co., Ltd.
Crown Music Enterprise Co.
Zoom Republic(Operation and management ofrecreation facilities)

Overseas users

DK KOREA Co., Ltd.
Daiichikosho (Shanghai), Ltd.
DAIICHI KOSHO (SHANGHAI)
TRADE CO., LTD.

Hokkaido Daiichikosho Co., Ltd.
Tohoku Daiichikosho Co., Ltd.
Niigata Daiichikosho Co., Ltd.
Kyushu Daiichikosho Co., Ltd.
Taito Daiichikosho Co., Ltd.
Tokai Daiichikosho Co., Ltd.
Daiichikosho Kinki Co., Ltd.
18 other companies

D.K. Enterprises (Guam), Inc.

(Equity method affiliate)
Bono Music(Production and sale of fruitwines)
Maruhagi Yoshu Kogyo Co., Ltd.

Sales and rentals of merchandise and products

Operation of karaoke cabins and restaurants

Provision of services

Note*: Daiichikosho Co., Ltd. acquired all shares of BESTa FOODS Co., Ltd. in June 2010. Therefore, BESTa FOODS
Co., Ltd. is included in the scope of consolidation.

5

DAIICHIKOSHO

CO.,

LTD.

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

FY2009(As of March 31, 2010)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade
Inventories
Deferred tax assets
Other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Karaoke equipment for rental
Accumulated depreciation
Karaoke equipment for rental, net
Karaoke cabin and restaurant facilities
Accumulated depreciation
Karaoke cabin and restaurant facilities, net
Land
Lease assets
Accumulated depreciation
Lease assets, net
Construction in progress
Other
Accumulated depreciation
Other, net
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Long-term loans receivable
Deferred tax assets
Lease and guarantee deposits
Other
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets

6

FY2010(As of March 31, 2011)

34,170
7,367
4,371
1,601
3,875
(461)
50,926

26,955
10,597
7,354
1,746
4,190
(397)
50,446

14,972(8,838)6,133
27,487(20,628)
6,859
30,864(17,471)
13,393
18,213
39
(14)
25
89
8,096
(6,823)
1,272
45,986

14,622(8,865)
5,757
29,389(23,089)
6,300
33,438(18,703)
14,735
19,143
138
(71)
66
42
8,024
(6,985)
1,039
47,085

－
7,420
7,420

641
7,421
8,063

2,849
506
3,381
13,1162,040(453)
21,441
74,849125,776

12,919994
3,852
13,1981,171(283)
31,85287,001
137,447DAIICHIKOSHO

CO.,

LTD.

(Millions of yen)

FY2009(As of March 31, 2010)
Liabilities
Current liabilities
Notes and accounts payable-trade
Short-term loans payable
Accounts payable-other
Income taxes payable
Provision for bonuses
Other
Total current liabilities
Noncurrent liabilities
Long-term loans payable
Deferred tax liabilities
Provision for retirement benefits
Provision for directors' retirement benefits
Negative goodwill
Other
Total noncurrent 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
Total accumulated other comprehensive income
Minority interests
Total net assets
Total liabilities and net assets

7

FY2010(As of March 31, 2011)

3,714
6,792
6,194
5,379
1,192
3,593
26,866

6,091
5,465
5,827
3,120
1,121
3,771
25,398

7,976
150
3,068
2,088
281
1,289
14,854
41,721

16,831
150
3,011
2,318
234
1,468
24,01449,413

12,35017,28555,563(973)
84,226

12,35014,03561,552(4)
87,934

(153)
(777)
(68)
(1,000)828
84,054
125,776

91
(777)
(164)
(851)
951
88,034137,447DAIICHIKOSHO

CO.,

LTD.

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

FY2009(From April 1, 2009, to
March 31, 2010)
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Advertising expenses
Promotion expenses
Packing and freight expenses
Directors' compensations
Provision for directors' retirement benefits
Salaries and bonuses
Provision for bonuses
Retirement benefit expenses
Rent expenses
Depreciation
Other
Total selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Cooperative monetary aid received
Amortization of negative goodwill
Other
Total non-operating income
Non-operating expenses
Interest expenses
Equity in losses of affiliates
Foreign exchange losses
Other
Total non-operating expenses
Ordinary income

8

FY2010(From April 1, 2010, to
March 31, 2011)

125,300
72,324
52,976

127,885
75,81952,065

3,195
1,570
1,083
1,638
388
14,311
946
645
1,627
702
9,427
35,537
17,439

2,834
2,049
1,126
1,702
376
13,922
901
646
1,379
805
9,810
35,554
16,510

179
481
54
888
1,603

223
499
66
685
1,475

252
53
126
201
633
18,408

208
35
96
188
528
17,457DAIICHIKOSHO

CO.,

LTD.

(Millions of yen)

FY2009(From April 1, 2009, to
March 31, 2010)
Extraordinary income
Gain on sales of noncurrent assets
Gain on redemption of investment securities
Reversal of allowance for doubtful accounts
Reversal of provision for directors' retirement benefits
Reversal of provision for retirement benefits
Indemnity of cancellation of leases
Other
Total extraordinary income
Extraordinary loss
Loss on disposal of noncurrent assets
Impairment loss
Loss on adjustment for changes of accounting standard
for asset retirement obligations
Loss on sales of investment securities
Loss on sales of stocks of subsidiaries and affiliates
Loss on valuation of investment securities
Loss on abolishment of qualified pension plan
Loss on disaster
Other
Total extraordinary losses
Income before income taxes and minority interests
Income taxes-current
Income taxes-deferred
Total income taxes
Income before minority interests
Minority interests in income
Net income

9

FY2010(From April 1, 2010, to
March 31, 2011)

11
－
218
－
－
248
11
490

13
148
49
44
110
－
17
383

691
857

344
284

－

440

－
57
64
－
－
12
1,683
17,215
7,133
(784)
6,348
10,866140
10,725

105
－
24
857
237
－
2,294
15,546
6,493
(707)
5,786
9,759
169
9,590

DAIICHIKOSHO

CO.,

LTD.

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

FY2009(From April 1, 2009, to
March 31, 2010)
Income before minority interests
Other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of theparentComprehensive income attributable to minority interests

10

FY2010(From April 1, 2010, to
March 31, 2011)

10,866

9,759

163
21
184
11,051

244
(96)
148
9,908

10,910

9,738

140

169

DAIICHIKOSHO

CO.,

LTD.

(3) Consolidated Statements of Changes in Net Assets(Millions of yen)

FY2009(From April 1, 2009, to
March 31, 2010)
Shareholders' equity
Capital stock
Balance at the end of previous period
Balance at the end of current period
Capital surplus
Balance at the end of previous period
Changes of items during the period
Retirement of treasury stock
Total changes of items during the period
Balance at the end of current period
Retained earnings
Balance at the end of previous period
Changes of items during the period
Dividends from surplus
Net income
Total changes of items during the period
Balance at the end of current period
Treasury stock
Balance at the end of previous period
Changes of items during the period
Purchase of treasury stock
Retirement of treasury stock
Total changes of items during the period
Balance at the end of current period
Total shareholders' equity
Balance at the end of previous period
Changes of items during the period
Dividends from surplus
Net income
Purchase of treasury stock
Retirement of treasury stock
Total changes of items during the period
Balance at the end of current period

11

FY2010(From April 1, 2010, to
March 31, 2011)

12,35012,35012,35012,35020,362

17,285(3,076)(3,076)
17,285(3,249)(3,249)14,03549,20755,563(4,369)10,725
6,355
55,563(3,601)
9,590
5,988
61,552(2,094)(973)(1,955)
3,076
1,121
(973)

(2,280)
3,249
969
(4)

79,82584,226(4,369)10,725(1,955)－4,400
84,226(3,601)9,590(2,280)－3,708
87,934DAIICHIKOSHO

CO.,

LTD.

(Millions of yen)

FY2009(From April 1, 2009, to
March 31, 2010)
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Balance at the end of previous period
Changes of items during the period
Net changes of items other than shareholders' equity
Total changes of items during the period
Balance at the end of current period
Revaluation reserve for land
Balance at the end of previous period
Balance at the end of current period
Foreign currency translation adjustment
Balance at the end of previous period
Changes of items during the period
Net changes of items other than shareholders' equity
Total changes of items during the period
Balance at the end of current period
Total accumulated other comprehensive income
Balance at the end of previous period
Changes of items during the period
Net changes of items other than shareholders' equity
Total changes of items during the period
Balance at the end of current period
Minority interests
Balance at the end of previous period
Changes of items during the period
Net changes of items other than shareholders' equity
Total changes of items during the period
Balance at the end of current period
Total net assets
Balance at the end of previous period
Changes of items during the period
Dividends from surplus
Net income
Purchase of treasury stock
Net changes of items other than shareholders' equity
Total changes of items during the period
Balance at the end of current period

12

FY2010(From April 1, 2010, to
March 31, 2011)

(317)

(153)

163
163
(153)

244
244
91

(777)
(777)

(777)
(777)

(90)

(68)

21
21
(68)

(96)
(96)
(164)

(1,184)(1,000)184
184(1,000)

148
148
(851)

690

828

137
137
828

123
123
951

79,331

84,054(4,369)10,725(1,955)322
4,723
84,054(3,601)9,590(2,280)271
3,979
88,034DAIICHIKOSHO

CO.,

LTD.

(4) Consolidated Statements of Cash Flows(Millions of yen)

FY2009(From April 1, 2009, to
March 31, 2010)
Net cash provided by (used in) operating activities
Income before income taxes and minority interests
Depreciation and amortization
Impairment loss
Loss on adjustment for changes of accounting standard
for asset retirement obligations
Amortization of negative goodwill
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for directors' retirement
benefits
Interest and dividends income
Loss (gain) on sales of stocks of subsidiaries and affiliates
Gain or loss on investments in investment businessassociations
Interest expenses
Loss (gain) on disposal of noncurrent assets
Loss (gain) on valuation of investment securities
Decrease (increase) in notes and accounts
receivable-trade
Decrease (increase) in inventories
Transfer of cost of sales on karaoke equipment for rental
Increase (decrease) in notes and accounts payable-trade
Other, net
SubtotalInterest and dividends income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities
Net cash provided by (used in) investing activities
Increase in time and saving deposits
Proceeds from decrease in time and saving deposits
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Payments for acquisition of video licenses
Purchase of investment securities
Proceeds from sales of investment securities
Purchase of investments in subsidiaries resulting inchange in scope of consolidation
Payments of loans receivableCollection of loans receivable
Payments for lease and guarantee deposits
Proceeds from collection of lease and guarantee deposits
Other, net
Net cash provided by (used in) investing activities

13

FY2010(From April 1, 2010, to
March 31, 2011)17,215
13,781857

15,546
13,551
284

－

440

(54)
(511)

(66)
(233)

(17)

230

(263)
57

(308)
－

(5)

(5)

252
680
64

208
331
24

1,576

(3,240)

449
439
(504)
159
34,178262(247)(3,052)
31,141(2,979)
379
2,377
1,513
28,053252(189)(8,772)
19,343(132)
257(9,164)59(3,914)(1,163)
－
0

(280)
191
(9,998)47(4,333)(1,651)(11,895)
1,933－(1,083)

(292)
417
(655)
443
27
(14,116)(1,100)486(1,030)304
198(28,213)DAIICHIKOSHO

CO.,

LTD.

(Millions of yen)

FY2009(From April 1, 2009, to
March 31, 2010)
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
Cash dividends paid
Purchase of treasury stock
Other, net
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

14

(205)
3,730
(9,952)(4,359)(1,955)(11)(12,754)
22
4,293
29,58433,877FY2010(From April 1, 2010, to
March 31, 2011)
237
13,135(5,843)(3,596)(2,280)
(24)
1,626
(61)
(7,304)33,877
26,573

DAIICHIKOSHO

CO.,

LTD.

Segment Information
FY2009 (From April 1, 2009, to March 31, 2010)
Commercial
karaoke
Sales
Sales to third parties
Intersegment sales
and transfers
Total
Segment income(Operating income)
Other items
Depreciation andamortization
Amortization of
goodwill

Reportable segments
KaraokeMusiccabin andsoftwarerestaurant

Other

Total

Subtotal(Millions of yen)Amount on
Adjusted
consolidated
amountstatements ofincome114,911

10,388125,300—

125,300

—

—

—

—

—

—

10,388125,300—

125,300

61,51340,897

12,501——

61,51340,897

12,501

114,911

11,528

7,043

1,174

19,747728

20,475(3,035)

17,439

8,586

2,878

39

11,504951

12,45634

12,491

—

—

—

—

—

—

—

—

FY2010 (From April 1, 2010, to March 31, 2011)
Commercial
karaoke
Sales
Sales to third parties
Intersegment sales
and transfers
Total
Segment income(Operating income)
Other items
Depreciation andamortization
Amortization of
goodwill

Reportable segments
KaraokeMusiccabin andsoftwarerestaurant

Other

Total

Subtotal(Millions of yen)Amount on
Adjusted
consolidated
amountstatements ofincome66,091

40,727

11,613

118,432

9,452

127,885—

127,885

—

—

—

—

—

—

—

—

66,091

40,727

11,613

118,432

9,452

127,885—

127,885

12,220

5,129

1,315

18,665829

19,494(2,984)

16,510

8,424

2,831

40

11,296859

12,15635

12,192

—

84

—

84

—

84

—

84

15