DAIICHIKOSHO

CO.,

LTD.

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

FY2019, the year ended March 31, 2020

Flash Report on the Consolidated Results for the Year Ended March 31, 2020
[JGAAP]May 25, 2020

Company Name:
Stock Exchange Listing:Code Number:
URL:
Representative:
Contact:

DAIICHIKOSHO CO., LTD.
Tokyo Stock Exchange
7458
https://www.dkkaraoke.co.jp/
Tadahiro Hoshi, President
Yasuhisa Nishihara,
Corporate Officer and General Manager, Accounting Department
Phone:+81-3-3280-2151
Date of the Ordinary General Meeting of Shareholders: June 19, 2020
Start Date for Dividend Payment:
June 22, 2020
Scheduled Date to Submit the Securities Report:
June 30, 2020
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, 2020 (From April 1, 2019, to March 31,
2020)(1) Consolidated operating results(Percentage figures indicate increase/decrease from a year earlier.)
Net sales
Millions of yen

Year ended March 31, 2020
Year ended March 31, 2019

146,297
143,833

Operating income
%
1.7
1.7

Millions of yen

19,05819,672

Ordinary income
%
(3.1)
(6.8)

Millions of yen

20,133
20,881

%
(3.6)
(4.5)

Net income attributable to
Basic earnings per shareowners of parent
Millions of yen%
Yen
Year ended March 31, 2020
12,555(19.5)
221.87
Year ended March 31, 201915,60018.9
274.43(Note) Comprehensive income:Year ended March 31, 2020: 11,553 million yen (24.2) %Year ended March 31, 2019: 15,251 million yen 13.1 %Fully diluted net income
per shareYen
221.56274.08

Ordinary income to total
assets%%Year ended March 31, 2020
9.5
10.9Year ended March 31, 2019
12.2
11.3
(Reference) Equity in net income of unconsolidated subsidiaries and affiliates:
Year ended March 31, 2020: ― million yen
Year ended March 31, 2019: ― million yen

Operating income to net
sales
%
13.0
13.7

Return on equity

1

DAIICHIKOSHO

CO.,

LTD.

(2) Consolidated financial position
Total assets

136,205
132,636

%
74.0
69.3

Net assets per shareYen
2,386.30
2,310.79

Net cash providedby (used in)operating activities

Net cash providedby (used in)investing activities

Net cash providedby (used in)financing activities

Cash and cash
equivalents at endof period

Millions of yen

Millions of yen

Millions of yen

Millions of yen

28,15530,221(21,430)(14,192)(15,872)(9,547)47,23256,439As of March 31, 2020
As of March 31, 2019
(Reference) Shareholders’ equity:
As of March 31, 2020:
As of March 31, 2019:

Net assets

Millions of yen

Millions of yen

181,567
188,814

Equity ratio

134,419 million yen
130,915 million yen(3) Consolidated cash flows

Year ended March 31, 2020
Year ended March 31, 2019

2. DividendYear ended March 31, 2019Year ended March 31, 2020
Year ending March 31, 2021
(forecast)First Quarter
Second Quarter
Yen
Yen
―
56.00
―
56.00
―

―

Aggregate amount ofdividend (total)

Annual dividend
Third Quarter
Yen――

Year-end
Yen
56.00
57.00

―

―

Payout ratio (consolidated)

AnnualYen
112.00113.00

Ratio of dividends to net
assets (consolidated)
%
5.0
4.8

Millions of yen%
Year ended March 31, 2019
6,362
40.8
Year ended March 31, 2020
6,384
50.9
Year ending March 31,―
2021 (forecast)(Note) Dividend forecast for the year ending March 31, 2021 is not determined at this time.

3. Forecast Consolidated Performance for FY2020, the Year Ending March 31, 2021 (From April 1,
2020, to March 31, 2021)
As it is currently difficult to reasonably calculate the impact of the spread of coronavirus disease (COVID-19) tobusiness activities of the Group, the forecast performance is yet to be determined. Forecast consolidated
performance will be disclosed as soon as it becomes available.

*Notes(1) Significant changes in subsidiaries during the period under review (changes to specific subsidiaries resulting inchanges in scope of consolidation): None
(2) Changes in accounting standard, accounting estimation change and error correction
1) Changes due to changes in accounting standard: None
2) Changes due to changes in accounting standard except (2) 1): None
3) Changes due to accounting estimation change: None
4) Error correction: None
(3) Number of common shares issued
1) Number of shares issued
As of57,234,200 As of
57,234,200(including treasury shares)
March 31, 2020
shares March 31, 2019
shares2) Number of shares of treasury
As of904,712 As of
580,290
sharesMarch 31, 2020
shares March 31, 2019
shares3) Average number of sharesYear ended
56,590,367 Year ended
56,847,498
during the period
March 31, 2020
shares March 31, 2019
shares2―

DAIICHIKOSHO

CO.,

LTD.

(Reference) Outline of Nonconsolidated Financial Results
1. Nonconsolidated Performance for the Year Ended March 31, 2020 (From April 1, 2019, to March 31, 2020)(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, 2020
103,057
2.9
13,323(6.9)
15,605(4.4)
Year ended March 31, 2019
100,1910.5
14,318(8.0)
16,319(5.3)
Net income
Millions of yen

Year ended March 31, 2020
Year ended March 31, 2019

10,68912,466

Fully diluted net income
per shareYen
188.62219.03

Basic earnings per share%(14.3)
14.8

Yen
188.89219.31(2) Nonconsolidated financial position
Total assets

Net assets

Millions of yen

Millions of yen

As of March 31, 2020
132,050
As of March 31, 2019
140,538(Reference) Shareholders’ equity:
As of March 31, 2020: 84,414 million yen
As of March 31, 2019: 82,738 million yen

84,72583,041Equity ratio
%
63.9
58.9

Net assets per share
Yen
1,498.59
1,460.42* These consolidated financial results are outside the scope of audit by Certified Public Accountants or auditing
corporations.
* Explanation for the appropriate use of performance forecasts and other special notes:
Since it is difficult to reasonably calculate the impacts of the spread of COVID-19 to business activities of theGroup, the forecast performance is yet to be determined. Forecast consolidated performance will be disclosed assoon as it becomes available.

3

DAIICHIKOSHO

CO.,

LTD.

Consolidated Financial Statements and Primary Notes(1) Consolidated Balance Sheets(Millions of yen)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Inventories
Other
Allowance for doubtful accounts
Total current assets
Non-current 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
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
Leasehold and guarantee deposits
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

4

FY2018(As of March 31, 2019)

FY2019(As of March 31, 2020)

57,182
5,205
5,464
6,762
(133)
74,482

47,992
4,758
7,777
5,331
(122)
65,737

14,645(8,741)
5,903
47,462(38,353)
9,108
52,002(32,540)
19,462
39,794
5,796(4,451)
1,345
75,614

14,866(9,098)
5,768
50,961(41,148)
9,813
54,221(34,102)
20,11840,600
6,583(4,949)1,634
77,935

3,407
6,944
10,351

2,900
7,299
10,199

4,849
546
6,110
14,976
1,956(71)
28,366
114,332
188,814

3,157
745
6,485
15,2492,127(71)
27,693
115,829
181,567DAIICHIKOSHO

CO.,

LTD.

(Millions of yen)

Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term borrowings
Current portion of bonds payable
Accounts payable - other
Income taxes payable
Provision for bonuses
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Deferred tax liabilities
Provision for retirement benefits for directors (and otherofficers)
Retirement benefit liability
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Share capital
Capital surplus
Retained earnings
Treasury shares
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 benefit plans
Total accumulated other comprehensive income
Share acquisition rights
Non-controlling interests
Total net assets
Total liabilities and net assets

5

FY2018(As of March 31, 2019)

FY2019(As of March 31, 2020)

3,469
3,264
6,500
8,979
6,030
1,156
3,710
33,111

4,929
2,786
－
7,986
2,117
1,184
3,429
22,433

11,89045

11,045
29

909

943

6,670
3,550
23,06656,178

7,270
3,638
22,92745,361

12,350
4,003
117,709(2,986)
131,077

12,350
4,003
123,891(4,589)135,656

814
(733)
47
(289)
(161)
302
1,417
132,636
188,814

(221)
(733)
(26)
(254)
(1,236)310
1,475
136,205
181,567DAIICHIKOSHO

CO.,

LTD.

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

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Advertising expenses
Promotion expenses
Packing and freight expenses
Remuneration for directors (and other officers)
Provision for retirement benefits for directors (and otherofficers)
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
Commission income
Cooperative monetary aid received
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Cancellation penalty
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales 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
Loss on valuation of investments in capital
Total extraordinary losses
Income before income taxes
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

6

FY2018(From April 1, 2018, to
March 31, 2019)

FY2019(From April 1, 2019, to
March 31, 2020)

143,833
89,55554,277

146,297
92,36253,935

2,284
1,548
807
1,424

2,306
2,039
833
1,355

153

137

13,707
879
596
1,058
802
11,34434,605
19,672

13,585
900
589
1,057
792
11,27834,876
19,058

53
156
378
214
855
1,658

31
150
366
－
870
1,419

159
－
133
156
449
20,881

114
19
59
151
344
20,133

5,952
61
6,013

28
39
68

366
1,828
－
－
97
2,292
24,602
9,465
(533)
8,931
15,67170
15,600

179
1,250
96
130
－
1,658
18,543
6,041
(125)
5,915
12,62872
12,555DAIICHIKOSHO

CO.,

LTD.

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

Net income
Other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests

7

FY2018(From April 1, 2018, to
March 31, 2019)

FY2019(From April 1, 2019, to
March 31, 2020)

15,671

12,628

(446)
(40)
67
(420)
15,251(1,036)(73)
35(1,075)
11,553

15,180

11,4807072DAIICHIKOSHO

CO.,

LTD.

(3) Consolidated Statements of Changes in Net Assets
FY2018 (from April 1, 2018, to March 31, 2019)(Millions of yen)
Shareholders’ equity
Share capital

Capital surplus

12,350

Balance at beginning of period

Retainedearnings

4,003

Treasury shares

108,489(1,309)Total
shareholders’equity123,534

Changes during period
Dividends of surplus
Net income attributable to ownersof parent
Purchase of treasury shares(6,380)(6,380)15,60015,600(1,677)

Disposal of treasury shares
Reversal of revaluation reserve forland
Net changes in items other thanshareholders' equity
Total changes during period(1,677)－(0)－
12,350

Balance at end of period

(0)

9,220
117,709－
4,003(1,677)(2,986)

7,543
131,077

Accumulated other comprehensive income

Balance at beginning of
periodValuationdifference on
available-for-salesecurities

Revaluation
reserve forland

Foreigncurrencytranslation
adjustment

1,261

(733)

87

Remeasurementsof defined benefit
plans

(356)

Total
accumulated
othercomprehensive
incomeShare
acquisitionrightsNon-controllinginterests

Total net
assets

258

203

1,359

125,356

Changes during period
Dividends of surplus
Net income attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
shares
Reversal of revaluation
reserve for land
Net changes in items
other than shareholders'equityTotal changes during period
Balance at end of period(6,380)15,600(1,677)
－
(0)
(446)

0

(40)

67

(420)

99

58

(262)

(446)
814

0
(733)

(40)
47

67
(289)

(420)
(161)

99
302

58
1,417

7,280
132,6368

DAIICHIKOSHO

CO.,

LTD.

FY2019 (from April 1, 2019, to March 31, 2020)(Millions of yen)
Shareholders’ equity
Share capital

Capital surplus

12,350

Balance at beginning of period

Retainedearnings

4,003

Treasury shares

117,709(2,986)

Total
shareholders’equity131,077

Changes during period(6,346)

Dividends of surplus
Net income attributable to ownersof parent
Purchase of treasury shares(6,346)

12,555

12,555(27)

Disposal of treasury shares
Reversal of revaluation reserve forland
Net changes in items other thanshareholders' equity
Total changes during period(1,719)116(1,719)88－－
12,350

Balance at end of period

6,181
123,891－
4,003(1,603)(4,589)4,578
135,656

Accumulated other comprehensive income

Balance at beginning of
periodValuationdifference on
available-for-salesecurities

Revaluation
reserve forland

Foreigncurrencytranslation
adjustment

814

(733)

47

Remeasurementsof defined benefit
plans

(289)

Total
accumulated
othercomprehensive
income

(161)

Share
acquisitionrightsNon-controllinginterests

Total net
assets302

1,417

132,636

Changes during period
Dividends of surplus
Net income attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
shares
Reversal of revaluation
reserve for land
Net changes in items
other than shareholders'equityTotal changes during period
Balance at end of period(6,346)
12,555(1,719)88－(1,036)

－

(73)

35

(1,075)7

57(1,009)(1,036)
(221)

－
(733)

(73)
(26)

35
(254)

(1,075)(1,236)

7
310

57
1,475

3,569
136,205

9

DAIICHIKOSHO

CO.,

LTD.

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

FY2018(From April 1, 2018, to
March 31, 2019)
Cash flows from operating activities
Income before income taxes
Depreciation
Amortization of goodwill
Impairment loss
Increase (decrease) in provision for retirement benefits for
directors (and other officers)
Interest and dividend income
Interest expenses
Foreign exchange losses (gains)
Loss (gain) on sales of investment securities
Loss (gain) on valuation of investment securities
Loss (gain) on disposal of non-current assets
Loss on valuation of investments in capital
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Transfer of cost of sales on karaoke equipment for rental
Decrease (increase) in advance payments - trade
Increase (decrease) in trade payables
Increase (decrease) in accounts payable – other
Other, net
SubtotalInterest and dividends received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Payments into time deposits
Proceeds from withdrawal of time 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
Proceeds from sales of investment securities
Purchase of investment securities
Purchase of shares of subsidiaries resulting in change in scopeof consolidation
Loan advances
Collection of loans receivable
Payments of leasehold and guarantee deposits
Proceeds from refund of leasehold and guarantee deposits
Other, net
Net cash provided by (used in) investing activities

10

FY2019(From April 1, 2019, to
March 31, 2020)

24,602
15,108658
1,828

18,543
15,604
606
1,250

(137)

33

(199)
159
(221)
(61)
－
(5,585)
97
(77)
784
76
(552)
48
423
1,336
38,289199(160)(8,107)30,221

(171)
114
60
56
130
151
－
434
(2,316)
75
1,099
1,467
(816)
1,610
37,935171(115)(9,835)28,155(54)81(15,263)8,889(4,467)(1,766)
61
(181)

(61)
44
(14,347)
66(4,224)(2,383)
189
－

－

(33)

(440)
484
(2,094)547
10(14,192)

(547)
470
(910)
240
66
(21,430)DAIICHIKOSHO

CO.,

LTD.

(Millions of yen)

FY2018(From April 1, 2018, to
March 31, 2019)
Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Proceeds from long-term borrowings
Repayments of long-term borrowings
Redemption of bonds
Dividends paid
Purchase of treasury shares
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

(273)
820
(2,016)－(6,381)(1,677)(18)(9,547)
221
6,702
49,73656,43911FY2019(From April 1, 2019, to
March 31, 2020)(38)
170(1,455)(6,500)(6,308)(1,719)(20)(15,872)(60)(9,207)56,43947,232DAIICHIKOSHO

CO.,

LTD.

Notes to the Consolidated Financial Statements(Segment Information)
FY2018 (From April 1, 2018, to March 31, 2019)(Millions of yen)
Commercial
karaoke

Reportable segments
KaraokeMusiccabin andsoftwarerestaurant

Subtotal

Other

Total

Adjusted
amount(Note)

Postedamount to theconsolidated
statements ofincomeSales
Sales to third parties
Intersegment sales
and transfers
Total
Segment income or
Segment loss
(Operating income or
Operating loss)
Other items
Depreciation andamortization
Amortization of
goodwill

63,444

63,7997,788

135,0318,801

143,833－

143,833

－

－

－

－

－

－

－

－

63,444

63,7997,788

135,0318,801

143,833－

143,833

12,926

8,001

(84)

20,844

1,581

22,425(2,752)

19,672

9,227

3,172

36

12,436594

13,031

182

13,213

2

655

－

658

－

658

－

658

Note: The (2,752) million yen adjustment posted to segment income or segment loss is primarily composed of generaland administrative expenses incurred by the administrative department at the head office that are not attributable toany particular reportable segment.

FY2019 (From April 1, 2019, to March 31, 2020)(Millions of yen)
Commercial
karaoke

Reportable segments
KaraokeMusiccabin andsoftwarerestaurant

Subtotal

Other

Total

Adjusted
amount(Note)

Postedamount to theconsolidated
statements ofincomeSales
Sales to third parties
Intersegment sales
and transfers
Total
Segment income(Operating income)
Other items
Depreciation andamortization
Amortization of
goodwill

65,366

63,7107,651

136,7299,568

146,297－

146,297

－

－

－

－

－

－

－

－

65,366

63,7107,651

136,7299,568

146,297－

146,297

13,742

6,255

174

20,172

1,547

21,720(2,661)

19,058

9,623

3,150

40

12,813604

13,418173

13,591

2

600

－

603

3

606

－

606

Note: The (2,661) million yen adjustment posted to segment income is primarily composed of general and administrative
expenses incurred by the administrative department at the head office that are not attributable to any particular
reportable segment.

(Additional Information)
Due to the spread of COVID-19, our Karaoke cabins and restaurants were required to close temporarily, and otherevents have affected our current business results as seen for example in a decrease in net sales. As for the impairment
of non-current assets and tax-effect accounting, etc., we estimate future cash flows, recoverability of deferred tax
assets and other matters assuming that this impact on business results will continue until the autumn of 2020.

12