Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2014
(April 1, 2013 through June 30, 2013)(Prepared pursuant to Japanese GAAP)All financial information has been prepared in accord with accounting principles generally accepted in Japan.
This is a partial English translation of the original Japanese-language document. All information pertains toconsolidated results unless otherwise noted. Information on the basis of presentation of consolidated financial
statements does not appear in this translation.
July 30, 2013
Company name:
Stock exchange listings:
Stock code:
URL:
Representative:
Contact:
Phone:

IT Holdings Corporation
The First Section of the Tokyo Stock Exchange3626
http://www.itholdings.co.jp/e/Norio Maenishi, President
Akio Kita, Deputy Division Manager, Administration Division+81 3-5338-2272

Scheduled dates
Submission of quarterly report:
Commencement of dividend payments:

August 8, 2013
-Supplementary materials to the quarterly results:
Quarterly results presentation held:

Available
Yes (targeted at institutional investors and analysts)

Figures in millions of yen are rounded down to the nearest million
1. Consolidated Results for the First Quarter of the Fiscal Year Ending March 31, 2014
(April 1, 2013 – June 30, 2013)(1) Consolidated Financial Results
Net sales

Percentages indicate year-over-year changes
Operating income
Recurring profit
Net income

millions of yen%

millions of yen%

millions of yen%millions of yen%

72,22372,620(0.5)
7.0(725)
256－－(450)316－－(670)
(453)

－－

First Quarter, FY2014First Quarter, FY2013

Note: Comprehensive income: First Quarter FY 2014: (23) million yen (- %), First Quarter FY 2013: (866) million yen (- %)Net income
per share – basic

Net income
per share – dilutedyenyen(7.64)(5.17)－－First Quarter, FY2014First Quarter, FY2013(2) Consolidated Financial Position

Total assets
End of First Quarter, FY2014
End of FY2013

Net assets

Equity ratio

millions of yen

millions of yen%

292,209302,302

156,714
158,159

51.0
49.8

For reference: Total equity: End of first quarter, FY2014: 149,123 million yen End of FY2013: 150,514 million yen.
*Total equity = Shareholders’ equity plus total accumulated other comprehensive income.
2. Cash Dividends for Shareholders of Common Stock
Record dateor period
FY2013
FY2014FY2014(forecast)

End-Q1

Cash dividends per share
End-Q2 End-Q3 Year-end

Totalyenyenyenyen-

7.00

-

14.00

21.00

8.00

-

17.00

25.00

Note: Revisions from the latest release of dividends forecasts: Noneyen

3. Forecast of Consolidated Results for FY2014 (April 1, 2013 – March 31, 2014)
Percentages indicate year-over-year changes
Operating
Net income perNet sales
Recurring profit
Net income
incomeshare – basic
First half of FY 2014
(six months ending
Sep. 30, 2013)
Full FY 2014
(year ending Mar.
31, 2014)

millions of yen%

millions of yen%

millions of yen

164,000

0.9

8,300 14.5

8,200

345,000

2.1

20,500 12.8

20,000%

millions of yen%

Yen

15.8

3,200

6.0

36.46

14.7

7,500

27.8

85.45

Note: Revisions from the latest release of earnings forecasts: None

※ Notes(1) Material reclassifications of subsidiaries during the period: None
(Changes in specified subsidiaries resulting in change in scope of consolidation)
Additions: None:
Exclusions: None
(2) Accounting methods specific to quarterly consolidated financial statements: None
(3) Changes in accounting policy, changes in accounting estimates, and retrospective restatement
1) Changes in accordance with amendments to accounting standards, etc.: None
2) Changes other than noted in 1) above: None
3) Changes in accounting estimates: None
4) Retrospective restatement: None
(4) Common stock issued
1) Issued shares as of period-end (including treasury stock):
End-First Quarter, FY2014 (June 30, 2013): 87,789,098 shares
End-FY2013 (March 31, 2013):
87,789,098 shares
2) Treasury stock as of period-end:
End-First Quarter, FY2014 (June 30, 2013):
19,965 shares
End-FY2013 (March 31, 2013):
19,046 shares
3) Average number of shares (during the respective three-month period):First quarter, FY2014 (ended June 30, 2013): 87,769,659 sharesFirst quarter, FY2013 (ended June 30, 2012): 87,772,147 shares*Quarterly review status
These materials are not subject to the quarterly review procedure requirements of Japan’s Financial Instruments
and Exchange Act. As of this report’s publication, a review of the quarterly consolidated financial statements inaccordance with the Act had not been completed.
Caution on Forward-Looking Statements and Other Important Matters
This report contains forward-looking statements that reflect IT Holdings Corporation (ITHD)’s plans andexpectations based on information available to ITHD at the time of preparation and on certain other information
ITHD believes to be reasonable.These forward-looking statements are not guarantees of future performance, andactual results, performance, achievements or financial position may differ materially from those expressed orimplied herein due to a range of factors.
For the assumptions underlying the forecasts herein and other notice on the use of earnings forecasts, refer to“(2) Consolidated Earnings Forecast and Caution on Forward-Looking Statements ” in the “1. Results ofOperations” section on page 3 in the Accompanying Materials.

Accompanying Materials – Contents
1. Results of Operations(1) Analysis of Consolidated Operating Results(2) Consolidated Earnings Forecast and Caution on Forward-Looking Statements
2. Consolidated Financial Statements(1) Consolidated Balance Sheets(2) Consolidated Statements of Income and Comprehensive Income
Consolidated Statements of Income
For the First Quarter
Consolidated Statements of Comprehensive Income
For the First Quarter(3) Notes on the Consolidated Financial Statements(Notes on the Going-concern Assumption)(Notes on Significant Changes in the Amount of Shareholders’ Equity)122344667888

1. Results of Operations(1) Analysis of Consolidated Operating Results
In the first quarter of fiscal 2014 (April 1, 2013 – June 30, 2013), the Japanese economy showed signs ofreflecting expectations for recovery as consumer spending, exports and production recovered in anticipation ofactive fiscal and financial measures by the government.
In the IT services industry, to which the IT Holdings Group belongs, despite the Bank of Japan’s quarterly
Short-term Economic Survey of Principal Enterprises in Japan (issued in June 2013) pointing to expansion of IT
investment on the back of economic recovery based on economic indicators such as a 5.7% increase year on year
in software investment plan (all manufacturing & financial institutions), no significant changes were visible as
far as actual customer sentiment towards IT investment was concerned, which continued to be prudent.
Under these circumstances, the IT Holdings Group’s consolidated net sales for the first quarter declined 0.5%
versus the same period of the previous fiscal year to ¥72,223 million. The Group posted an operating loss of¥725 million compared with an operating income of ¥256 million a year earlier. The Group recorded a recurring
loss of ¥450 million compared with a profit of ¥316 million for the previous fiscal year, and a net loss of ¥670
million versus a loss of ¥453 million a year earlier.
Consolidated net sales maintained the previous year’s level, as the recovery in the Financial IT Services
segment offset the decline in the Industrial IT Services segment caused by the impact of the reversion to a largescale system development project for a major manufacturer in the same period of the previous fiscal year.
However, profits were short of the previous year’s levels, outweighed by the significant impact of unprofitableprojects in the Industrial IT Services segment.
First-quarter results by segment are as follows. The sales figures for each segment include inter-segment sales.

1) IT Infrastructure Services
Consolidated sales rose 0.4% year on year to ¥27,097 million and operating income declined 10.7% to ¥1,518
million. Sales gradually increased compared with a year earlier as more and more major clients started using theGroup’s data centers, while operating income declined from the same period a year earlier due to the impact ofhigher data center-related costs.

2) Financial IT Services
Consolidated sales in the first quarter increased 7.7% from the same period a year ago to ¥14,670 million, andthe operating loss narrowed to ¥22 million from ¥202 million for the same period of the previous fiscal year.
Sales in this segment grew year on year and profit levels improved, as major customer credit card and insurancecompanies gradually expanded their IT-related investments.

3) Industrial IT Services
Consolidated sales declined 3.9% year on year to ¥30,660 million, and the operating loss expanded to ¥2,270
million from ¥1,424 million for the same period of the previous fiscal year. Sales declined due to the impact of
the reversion to a large-scale system development project for a major manufacturer in the previous year. Profit
levels declined compared with a year earlier mainly due to the impact of recording additional expenses reflecting
the delay in the completion of some development projects.

4) OtherConsolidated sales in this segment declined 4.9% year on year to ¥4,292 million, and operating income
declined 8.7% to ¥521 million.
With the aim of becoming an IT business that will implement reforms as a single unit, the IT Holdings Groupin the previous fiscal year embarked on implementation of measures under the second medium-term
management plan (from fiscal 2013 through fiscal 2015) under the three basic concepts of “Top-Line Emphasis,”
acting “as One Company” and being “Enterprising and Bold” and has been addressing the management issues.
Based on the business results from the previous fiscal year and implementation status of related measures in
the current fiscal year, which is the second year of the second medium-term management plan, the Group has2

been driving forward various measures under the group management strategy based on the basic concepts of “putthe Group top-line on a ‘growth track’ to ensure ‘earnings recovery’,” “further strengthen the Group’s
communication base and develop an open and dynamic corporate culture,” and “expand the services-oriented
business and promote globalization.” As part of these efforts, the Company shifted to a new management setup,
under which the five representative directors of major group companies simultaneously serve as part-time
directors of the Company, to strengthen the structure to achieve Group total optimum.
(2) Consolidated Earnings Forecast and Caution on Forward-Looking Statements
Sales have been proceeding largely in line with the plan. While the progress on the profit side is slightly
behind the plan due to the impact of unprofitable projects in the first quarter, the Group aims to strive as one toachieve the targets by bridging the gap through measures including cost reductions.
Based on above, the Group did not make any changes to the consolidated earnings forecast announced on May
10, 2013.

3

2. Consolidated Financial Statements(1) Consolidated Balance Sheets
As of March 31, 2013

Items
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable
Lease receivables and lease investment assets
Marketable securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Deferred tax assets
Other current assets
Allowance for doubtful accounts
Total current assets
Fixed assets
Property and equipment
Buildings and structures, netMachinery and equipment, net
Land
Leased assets, net
Other property and equipment, net
Total property and equipment
Intangible assets
Goodwill
Other intangible assets
Total intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Other assets
Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
Total assets

4

As of June 30, 2013

millions of yen

millions of yen

28,633
68,249
9,322
5,401
3,035
7,091
200
8,523
7,846
(85)
138,219

36,97042,355
9,126
4,425
3,747
12,081
231
7,597
9,429
(89)
125,876

58,133
4,231
21,135
3,615
6,475
93,59258,4194,186
21,135
3,574
6,659
93,977

1,784
13,487
15,272

1,409
13,50014,91032,633
6,823
17,577(1,816)55,218164,083
302,302

33,021
8,462
17,799(1,838)57,445
166,332
292,209As of March 31, 2013

Items
Liabilities
Current liabilities
Notes and accounts payable
Short-term borrowings
Income taxes payable
Accrued bonuses to directors and employees
Other allowances
Other current liabilities
Total current liabilities
Non-current liabilities
Long-term debt
Lease obligations
Accrued retirement benefits to employees
Accrued retirement benefits to directors
Deferred tax liabilities
Deferred tax liabilities from revaluation of land
Other non-current liabilities
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Common stock
Additional paid-in capital
Retained earnings
Less treasury stock, at cost
Total shareholders’ equity
Accumulated other comprehensive income
Net unrealized gains on other securities
Revaluation of land
Foreign currency translation adjustments
Total accumulated other comprehensive income
Stock acquisition rights
Minority interests
Total net assets
Total liabilities and net assets

5

As of June 30, 2013

millions of yen

millions of yen

17,69232,881
3,112
11,074551
25,75091,06315,002
32,927
997
5,622
483
29,63384,666

27,6685,501
12,762
108
492
732
5,813
53,079144,143

24,992
5,437
13,342
102
477
732
5,744
50,829135,495

10,00186,78751,596(27)
148,357

10,00186,787
49,696(29)
146,456

4,271(1,967)
(147)
2,157
42
7,602
158,159
302,302

4,716(1,967)
(82)
2,666
33
7,557
156,714292,209(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income
Consolidated Statements of Income
First Quarter FY2013
First Quarter FY2014(Apr. 1 – Jun. 30, 2012) (Apr. 1 – Jun. 30, 2013)
Items
millions of yen

Net sales
Cost of sales

72,62061,46472,223
61,845Gross profit
Selling, general and administrative expenses

11,156

10,378

10,899

11,103Operating income (loss)
Non-operating income
Interest income
Dividend income
OtherTotal non-operating income
Non-operating expense
Interest expenses
Equity in losses of non-consolidated subsidiaries andaffiliates
Other

256(725)

6449
215

7507
232

670

748

208

158

96

125

305

188

Total non-operating expenses
Recurring profit (loss)
Extraordinary income
Gain on sale of investment securities
Gain on transfer of business
Other

610

473

316(450)

69
1826
0

Total extraordinary income
Extraordinary loss
Loss on disposal of fixed assets
Impairment loss
Other

70

34

69
434
27

20
9

Loss before income taxes and minority interests

530(143)

30(445)

Income taxes: current
Income taxes: deferred

1,042
(668)

983
(876)

Total income taxes

373(517)

107(552)(63)

118(453)(670)

Total extraordinary loss

Loss before minority interests
Minority interests in earnings (losses) of consolidated
subsidiaries
Net loss

6

Consolidated Statements of Comprehensive Income
Items
Loss before minority interests
Other comprehensive income
Net unrealized gains on other securities
Difference in revaluation of land
Foreign currency translation adjustments
Share of other comprehensive income of associates
accounted for using the equity method
Total other comprehensive income
Comprehensive income(Composition)
Comprehensive income attributable to owners ofthe parent
Comprehensive income attributable to minority
interests

7

First Quarter FY2013(Apr. 1 – Jun. 30, 2012)

First Quarter FY2014(Apr. 1 – Jun. 30, 2013)

millions of yen

millions of yen

(517)

(552)

(183)
(248)
79

437
－84

3

7

(349)

528

(866)

(23)

(825)

(161)

(41)

137

(3) Notes on the Consolidated Financial Statements(Notes on the Going-concern Assumption)
Not applicable(Notes on Significant Changes in the Amount of Shareholders’ Equity)
Not applicable8