Annual Report 2020
Fiscal year ended March 31, 2020

Sumitomoichigaya Building 8F 1-1, Ichigayahonmura-cho,Shinjuku-ku,Tokyo, 162-0845, Japan
Tel: +81-(0)3-6774-8594 Fax: +81-(0)3-6774-8615
https://www.wave-nakano.co.jp
SINGAPORE
1 Coleman St., #06-02 The Adelphi, 179803, Singapore
Tel: +65-6333-4933
Fax: +65-6338-8568

MALAYSIA
Block B, 15-4-2, Megan Salak Park Jalan 1/125E, Taman Desa Petaling, Kuala Lumpur 57100, Malaysia
Tel: +60-3-9059-6977
Fax: +60-3-9059-6277

INDONESIA
Tamara Center 14th Floor Jl. Jend. Sudirman KAV. 24, Jakarta 12920, Indonesia
Tel: +62-21-5203674
Fax: +62-21-5203670

THAILAND
2170 Bangkok Tower, 17th Floor New Petchburi Road, Bangkapi, Huaykwang, Bangkok 10310 Thailand
Tel: +66-2-308-0500
Fax: +66-2-308-0497

VIETNAM
Unit 1411-1412, 14th Floor, Daeha Business Center, 360 Kim Ma Street, Ngoc Khanh Ward, Ba Dinh District, Hanoi, Vietnam
Tel: +84-243-724-7552
Fax: +84-243-724-7553

CORPORATE PROFILECONTENTS

Company Outline (As of March 31, 2020)

FINANCIAL HIGHLIGHTS

1

REPORT OF INDEPENDENT AUDITORS

2

CONSOLIDATED BALANCE SHEETS

4CONSOLIDATED STATEMENTS OF INCOME

6

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

7

CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS

8

CONSOLIDATED STATEMENTS OF CASH FLOWS

9NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

10

SUPPLEMENTAL INFORMATION

30

Company Name
Headquarters
Foundation
Established
Capitalization
Employees
Stock Listing
Primary Business

Board of Directors (As of September 17, 2020)

NONCONSOLIDATED BALANCE SHEETS

30

NONCONSOLIDATED STATEMENTS OF INCOME

32

Honorary Chairman
Vice Chairman
President
Directors

33

Outside Directors

CORPORATE PROFILE

NAKANO CORPORATION
Sumitomoichigaya Building 8F 1-1, Ichigayahonmura-cho, Shinjuku-ku, Tokyo 162-0845, Japan
February 8, 1933
December 19, 1942
¥5,061,678,686
1,361(Group)Tokyo Stock Exchange, First Section
Domestic Construction Projects
International Construction Projects
Real Estate BusinessStanding Corporate Auditors
Corporate Auditors

Yoshikazu Oshima
Akira Asai
Toshiyuki Taketani
Yorinobu Kato
Tetsuo Sato
Moriyasu Kawamura
Mitsuharu Kotaka
Akihiko Sugaya
Kohei Yamaya

Hiroyuki Tanada
Makoto Fukuda
Koichiro Nakano
Hideaki Sekizawa

Main Affiliated Financial Institutions
MUFG Bank, Ltd.
The Shoko Chukin Bank, Ltd.
The Shizuoka Bank, Ltd.
The Musashino Bank, Ltd.

Mizuho Bank, Ltd.
The Bank of Yokohama, Ltd.
The Yamanashi Chuo Bank, Ltd.
The Joyo Bank, Ltd.

Major Shareholders
Oshima Scholarship Foundation
Yoshikazu Oshima
MB Service Co., Ltd.

Kanto Kogyo Co., Ltd.
Marine Dream Co., Ltd.
MUFG Bank, Ltd.

Domestic Offices
Headquarters
Tohoku Regional OfficeOsaka Regional Office
Civil Engineering Office
Hokkaido Branch Office
Kita Kanto Branch Office
Yokohama Branch Office

Tokyo Main Office
Nagoya Regional Office
Kyushu Regional Office
Taito Branch Office
Kita Tohoku Branch Office
Higashi Kanto Branch Office
Sales Offices (Mie, Kita Kyushu)

International Offices
Nakano Singapore (Pte.) Ltd. (Singapore)
PT. Indonakano (Indonesia)
Nakano Vietnam Co., Ltd. (Vietnam)

Cautionary remarks regarding forward looking statements
This Annual Report includes forward-looking statements that represent Nakano Corporation’s assumptions and expectations inlight of currently available information. These statements reflect industry trends, client’s situations and other factors, and involverisks and uncertainties which may cause actual performance results to differ from those discussed in the forward looking
statements in accordance with changes in the domestic and international business environment.
For further information contact:
Nakano Corporation International Operations Headquarters
Sumitomoichigaya Building 8F 1-1,
Ichigayahonmura-cho, Shinjuku-ku, Tokyo, 162-0845, Japan
Tel: +81-(0)3-6774-8594 Fax: +81-(0)3-6774-8615
https://www.wave-nakano.co.jp

Nakano Construction Sdn. Bhd. (Malaysia)
Thai Nakano Co., Ltd. (Thailand)

Industry Affiliations
Japan Federation of Construction Contractors
The Associated General Contractors of Tokyo
General Contractors Association of Osaka

National General Contractors Association of Japan
Japan Association of Representative General Contractors

ANNUAL REPORT 2020

33

FINANCIAL HIGHLIGHTS

NAKANO CORPORATION and its subsidiaries
Years ended March 31, 2016 through 2020
2016

2017

2018

2019

2020

2020

Millionsof yenThousands of
U.S. dollars

Contract awards¥114,067¥108,637¥116,422¥125,022¥115,640$1,062,574

Net sales

114,989

116,802104,456

117,152

116,977

1,074,859

Operating income

5,481

5,958

4,264

5,476

4,104

37,710Ordinary income

5,795

6,232

4,579

5,954

4,395

40,384

Profit attributable to owners of parent

3,986

5,544

3,947

3,990

2,932

26,941

Comprehensive income

2,942

5,816

4,631

4,023

1,661

15,262

Total net assets

20,88026,45530,742

34,35235,532

326,490

Total assets

73,976

77,98484,55484,45081,349747,486

Net cash provided by (used in) operating activities

9,607

428

4,611

2,864

(6,797)(62,455)

Net cash provided by (used in) investing activities

844(3,698)(1,773)

2,544

(555)

(5,099)Net cash provided by (used in) financing activities(2,244)

(969)

(458)

(931)

(1,821)(16,732)

Cash and cash equivalents at end of period

29,32924,36427,001

31,60021,612

198,584

Yen

U.S. dollars

Per share of common stock( in yen and U.S. dollars )Net assets¥577.61¥738.16¥860.02¥961.56¥996.50$9.16

Net income

115.96161.28114.83116.09

85.33

0.78

7.00

10.00

12.00

14.00

14.00

0.13

1,314

1,363

1,355

1,390

1,361

Cash dividends applicable to the year
Number of employees

Notes: 1. The rate of ¥108.83=US$1.00, the foreign exchange rate on March 31, 2020, has been used for translation.
2. Cash dividends applicable to the year in 2017 includes a special dividend ¥3.

140,000

140,000

120,000

120,000

100,000

100,000

80,00060,00040,00080,00060,00040,00020,00020,000002016 2017 2018 2019 2020
Domestic

International

Profit attributableto owners of parent

Millions of yen

Net Sales

Millions of yen

Millions of yen

Contract Awards

2016 2017 2018 2019 2020
Domestic

6,000
5,500
5,000
4,500
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
2016 2017 2018 2019 2020

International

ANNUAL REPORT 2020

1

REPORT OF INDEPENDENT AUDITORS

2

NAKANO CORPORATIONANNUAL REPORT 2020

3

CONSOLIDATED BALANCE SHEETSNAKANO CORPORATION and its subsidiaries
As of March 31, 2019 and 2020

Millions of yen

Thousands of
U.S. dollars(Note 2)

2019

2020

2020

¥32,329¥22,535$207,066

25,68230,391

279,252

9

—

—

1,396

2,890

26,555

Costs on real estate business

48

48

441

Raw materials and supplies

6

6

55

Accounts receivable - other

3,352

2,191

20,132—

2,202

20,233

AssetsCurrent assets:
Cash and deposits (Notes 4, 7 and 9)
Notes receivable, accounts receivable from completed
construction contracts and other (Notes 4 and 9)
Securities (Notes 4, 9 and 10)
Costs on uncompleted construction contracts (Note 4)

Consumption taxes receivable
Other
Allowance for doubtful accounts
Total current assets

1,182

985

9,050

—

(161)

(1,479)64,00961,091

561,343

8,128

7,804

71,708Non-current assets:
Property, plant and equipment (Note 4)
Buildings and structures
Machinery, vehicles, tools, furniture and fixtures (Note 8)

1,570

1,592

14,628Land

11,515

11,524

105,889

Construction in progress

54

49

450

(5,620)(5,117)(47,018)

15,64815,853

145,667

Leasehold right

960

903

8,297

Other

105

93

854

1,066

996

9,151

3,243

2,909

26,729Long-term loans receivable

108

67

615

Net defined benefit asset (Note 11)

30

—

—

Other

380

443

4,070

Allowance for doubtful accounts

(36)

(13)

(119)

Accumulated depreciation
Total property, plant and equipment
Intangible assets

Total intangible assets
Investments and other assets
Investment securities (Notes 4, 9 and 10)

Total investments and other assets

3,726

3,407

31,305

Total non-current assets

20,441

20,257

186,134¥84,450¥81,349$747,486

Total assets
The accompanying notes are an integral part of these financial statements.

4

NAKANO CORPORATIONMillions of yen

Thousands of
U.S. dollars(Note 2)

2019

2020

2020

¥35,228¥34,236$314,582

Liabilities
Current liabilities:
Notes payable, accounts payable for construction contracts
and other (Notes 4 and 9)
Short-term loans payable (Notes 4, 9 and 17)

810

480

4,410

Current portion of bonds (Notes 9 and 16)

1,000

—

—

Income taxes payable

1,315

315

2,894

Advances received on uncompleted construction contracts

5,715

6,644

61,049

272

255

2,343

Provision for warranties for completed construction
Provision for loss on construction contracts (Note 4)

—

1

9

Provision for bonuses

599

538

4,943

Other (Note 17)
Total current liabilities

2,918

769

7,066

47,86043,241

397,326

—

500

4,594

Non-current liabilities:
Bonds payable (Notes 9 and 16)
Long-term loans payable (Notes 4, 9 and 17)

1,030

720

6,615

Deferred tax liabilities (Note 12)

286

282

2,591

Net defined benefit liability (Note 11)

266

268

2,462

Other (Note 17)

654

805

7,396

Total non-current liabilities
Total liabilities

2,237

2,576

23,66950,09745,817420,996

Net assets
Shareholders’ equity:
Common stock
Authorized: 154,792,300 shares¥5,061¥5,061$46,503

Capital surplus

Issued:34,498,097 shares

1,400

1,400

12,864Retained earnings
Less: Treasury stock, at cost
126,779 shares in 2019 and 128,323 shares in 2020

26,481

28,933

265,855

(33)

(34)

(312)

32,91035,360324,910

Total shareholders’ equity
Accumulated other comprehensive income:
Valuation difference on available-for-sale securities

824

597

5,485

Foreign currency translation adjustment(651)(1,575)(14,472)

Remeasurements of defined benefit plans (Note 11)

(32)

(133)

(1,222)

Total accumulated other comprehensive income

139(1,111)(10,208)

Non-controlling interests:

1,302

1,282

11,779Total net assets

34,35235,532

326,490¥84,450¥81,349$747,486

Total liabilities and net assets
The accompanying notes are an integral part of these financial statements.

ANNUAL REPORT 2020

5

CONSOLIDATED STATEMENTS OF INCOME
NAKANO CORPORATION and its subsidiaries
For the years ended March 31, 2019 and 2020

Net sales:
Net sales of completed construction contracts
Sales on real estate business (Note 13)
Sales on other businessTotal net sales
Cost of sales:
Cost of sales of completed construction contracts (Note 5)
Cost of sales on real estate business (Note 13)
Cost of sales on other businessTotal cost of sales
Gross profit:
Gross profit on completed construction contracts
Gross profit - real estate business
Gross profit - other businessTotal gross profit
Selling, general and administrative expenses (Note 5)
Operating income
Non-operating income:Interest income
Dividend income
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses:
Interest expenses
Foreign exchange losses
Bond issuance cost
Other
Total non-operating expenses
Ordinary income
Extraordinary income:Gain on sales of non-current assets (Note 5)
Gain on liquidation of subsidiaries and associates
Total extraordinary income
Extraordinary losses:
Loss on litigation
Head office relocation expenses (Note 5)
Extra retirement payments of subsidiaries
Other (Note 5)
Total extraordinary losses
Profit before income taxes
Income taxes:
Income taxes - current
Income taxes - deferred (Note 12)
Total income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent
The accompanying notes are an integral part of these financial statements.

6

NAKANO CORPORATION

Millions of yen

Thousands of
U.S. dollars(Note 2)

2019

2020

2020

¥115,970
1,076
105
117,152¥115,691
1,177
109
116,977$1,063,043
10,8151,001
1,074,859

105,884387
63
106,335

106,787426
62107,276

981,227
3,914
569
985,720

10,085689
42
10,817
5,340
5,476

8,903
751
46
9,701
5,596
4,104

81,8066,900
422
89,13951,41937,710

333
53
61
61
510

290
55
—
22
368

2,664
505
—
202
3,381

28
—
—
3
32
5,954

31
28
15
2
77
4,395

284
257
137
18
707
40,384

2
—
2

16
17
34

147
156
312

35
200
—
8
244
5,712

79
54
111
5
250
4,178

725
496
1,019
45
2,297
38,390

1,562
70
1,633
4,078
88
¥3,990

1,153
54
1,207
2,971
38
¥2,932

10,594496
11,09027,299349$26,941

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
NAKANO CORPORATION and its subsidiaries
For the years ended March 31, 2019 and 2020

Millions of yen

Thousands of
U.S. dollars(Note 2)

2019

2020

2020

¥4,078¥2,971$27,299

(210)
115
39
(55)

(226)
(982)
(101)
(1,309)(2,076)(9,023)(928)(12,027)

Comprehensive income¥4,023¥1,661$15,262

Comprehensive income attributable to:Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests¥3,902121¥1,681(20)$15,446(183)

ProfitOther comprehensive income:
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total other comprehensive income (Note 6)

The accompanying notes are an integral part of these financial statements.

ANNUAL REPORT 2020

7

CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETSNAKANO CORPORATION and its subsidiaries
For the years ended March 31, 2019 and 2020
Millions of yen
Shareholders’ Equity

Commonstock

Balance as at March 31, 2018

CapitalsurplusRetainedearnings

Accumulated other comprehensive income

Valuation
Total
difference
accumulated
Foreign
Nonothercurrency Remeasurements
Total on available-for-sale translationof defined comprehensive controlling
Treasury shareholders’interests
securities adjustment
incomeequitybenefit plansstock¥5,061 ¥1,400 ¥22,904 ¥(32) ¥29,333

Total net
assets¥1,034 ¥(734) ¥(71) ¥228 ¥1,180 ¥30,742

Changes of items during
periodDividends from surplus(412)

Profit attributable to owners ofparent

3,990

Purchase of treasury stock

(0)

(412)

(412)

3,990

3,990

(0)

(0)

Net changes of items otherthan shareholders’ equity
Total changes of items during
periodBalance as at March 31, 2019

—

—

3,577

(0)

3,576

¥5,061 ¥1,400 ¥26,481 ¥(33) ¥32,910

(210)

82

39

(88)

121

33

(210)

82

39

(88)

121

3,610

¥824 ¥(651) ¥(32) ¥139 ¥1,302 ¥34,352

Changes of items during
periodDividends from surplus(481)

Profit attributable to owners ofparent2,932

Purchase of treasury stock

(0)

(481)

(481)

2,932

2,932

(0)

(0)

Net changes of items otherthan shareholders’ equity
Total changes of items during
periodBalance as at March 31, 2020

—

—

2,451

(0)

2,450

¥5,061 ¥1,400 ¥28,933 ¥(34) ¥35,360

(226)

(923)

(101)

(1,251)(20)(1,271)

(226)

(923)

(101)

(1,251)

(20)

1,179

¥597 ¥(1,575) ¥(133) ¥(1,111) ¥1,282 ¥35,532

Thousands of U.S. dollars (Note 2)
Shareholders’ Equity

Commonstock

Balance as at March 31, 2019

CapitalsurplusRetainedearnings

Accumulated other comprehensive income

Valuation
Total
difference
accumulated
Foreign
Nonothercurrency Remeasurements
Total on available-for-sale translationof defined comprehensive controlling
Treasury shareholders’interests
securities adjustment
incomeequitybenefit plansstock$46,503 $12,864 $243,324 $(303) $302,398

Total net
assets$7,571 $(5,981) $(294) $1,277 $11,963 $315,648

Changes of items during
periodDividends from surplus(4,419)Profit attributable to owners ofparent26,941

Purchase of treasury stock(0)(4,419)(4,419)26,941

26,941(0)(0)

Net changes of items otherthan shareholders’ equity
Total changes of items during
periodBalance as at March 31, 2020——

22,521(0)

NAKANO CORPORATION(8,481)(928)(11,494)(183)(11,678)(2,076)(8,481)(928)(11,494)(183)

10,833$46,503 $12,864 $265,855 $(312) $324,910 $5,485 $(14,472) $(1,222) $(10,208) $11,779 $326,490

The accompanying notes are an integral part of these financial statements.

8

22,512(2,076)

CONSOLIDATED STATEMENTS OF CASH FLOWSNAKANO CORPORATION and its subsidiaries
For the years ended March 31, 2019 and 2020

Cash flows from operating activities:
Profit before income taxes
Adjustments for:
Depreciation and amortization
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in net defined benefit liability
Decrease (increase) in net defined benefit asset
Increase (decrease) in provision for loss on construction
contracts
Interest and dividend income
Interest expenses
Decrease (increase) in notes and accounts receivable - trade
Decrease (increase) in costs on uncompleted construction
contracts
Increase (decrease) in notes and accounts payable - trade
Increase (decrease) in advances received on uncompleted
construction contracts
Decrease/increase in consumption taxes receivable/payable
Other, net
SubtotalInterest and dividend income received
Interest expenses 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
Purchase of intangible assets
Other, net
Net cash provided by (used in) investing activities
Cash flows from financing activities:
Net increase (decrease) in short-term loans payable
Repayments of long-term loans payable
Proceeds from issuance of bonds
Redemption of bonds
Cash dividends paid
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 (Note 7)

Millions of yen

Thousands of
U.S. dollars(Note 2)

2019

2020

2020

¥5,712¥4,178$38,390

314
23
(41)
(77)

474
156
(7)
(83)

4,355
1,433
(64)
(762)

(41)
(386)
28
1,158

1
(346)
31
(5,372)9(3,179)284(49,361)107(2,231)(1,545)(351)(14,196)(3,225)(3,449)
3,215
(942)
3,389
391
(28)
(888)
2,864

951
(4,074)986(5,001)357(29)(2,124)(6,797)

8,738(37,434)
9,060(45,952)
3,280
(266)
(19,516)(62,455)(1,093)
5,285(1,611)
(78)
42
2,544

(1,236)
1,020
(314)
(14)
(11)
(555)

(11,357)
9,372(2,885)(128)(101)(5,099)

(140)
(310)
—
(40)
(412)
(29)
(931)
122
4,599
27,001¥31,600

(30)
(610)
482
(1,000)(480)(183)(1,821)(813)(9,988)31,600¥21,612(275)(5,605)
4,428(9,188)(4,410)(1,681)(16,732)(7,470)(91,776)
290,361$198,584

The accompanying notes are an integral part of these financial statements.

ANNUAL REPORT 20209

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NAKANO CORPORATION and its subsidiaries

1.	Basis of Presenting
Consolidated
Financial
Statements

The consolidated financial statements presented herein of NAKANO CORPORATION (the“Company”) and its consolidated subsidiaries (together, the “Group”) are prepared in accordancewith the provisions set forth in the Japanese Financial Instruments and Exchange Law and its
related accounting regulations, and in conformity with accounting principles generally accepted inJapan (“Japanese GAAP”), which are different in certain respects as to application and disclosure
requirements of International Financial Reporting Standards.
In preparing these consolidated financial statements, certain reclassifications andrearrangements have been made to the consolidated financial statements issued domestically inorder to present them in a form which is more familiar to readers outside Japan. In addition, certain
reclassifications have been made to the 2019 financial statements to conform to the classifications
used in 2020.

2. U.S. Dollar Amounts The accounts of consolidated financial statements presented herein are expressed in Japanese

yen by rounding down to the nearest million. The U.S. dollar amounts shown in the accompanying
consolidated financial statements and notes thereto have been translated from Japanese yen into
U.S. dollars on the basis of ¥108.83 to U.S.$1, the rate of exchange prevailing at March 31, 2020,and have been then rounded down to the nearest thousand. These U.S. dollar amounts are notintended to imply that the Japanese yen amounts have been or could be converted, realized or
settled in U.S. dollars at this or any other rate.

3.	Summary of
Significant
Accounting Policies

a. Consolidation
1) Scope of Consolidation
The Company had 9 subsidiaries as of March 31, 2020. The consolidated financial statements forthe year ended March 31, 2020 include the accounts of the Company and all subsidiaries.
2) Financial Statements of Subsidiaries
The subsidiaries’ financial year-end is March 31.
b. Securities
Securities are classified and accounted for as follows:
1) Held-to-maturity debt securities, which are expected to be held to maturity with the positive
intent and ability are reported at amortized cost.
2) Available-for-sale securities, which are not classified as the aforementioned securities, arereported at fair value, with unrealized gains and losses, net of applicable taxes, reported in a
separate component of net assets, while the cost of securities sold is computed using the movingaverage method.
Non-marketable available-for-sale securities are stated at cost determined by the movingaverage method. For other than temporary declines in fair value, securities are written down to net
realizable value.
c. Inventories
Costs on uncompleted construction contracts are stated at cost determined by the specificidentification method.
Costs on real estate business and raw materials and supplies are stated at cost determined by
the specific identification method for costs on real estate business and by the last purchase pricemethod for raw material and supplies, while the net book value of these inventories in the balance
sheet is written down if the net realizable value declines.
d. Property, Plant and Equipment (excluding lease assets)
Property, plant and equipment are stated at cost. Depreciation of property, plant and equipment of
the Company and its domestic consolidated subsidiaries is computed by the declining-balancemethod. Buildings (excluding building fixtures) acquired on or after April 1, 1998 and building
fixtures and structures acquired on or after April 1, 2016 are depreciated using the straight-line
method. Useful lives and residual values of the assets are determined based on the regulations of
the Corporation Tax Act.
Foreign consolidated subsidiaries use primarily the straight-line method.

10

NAKANO CORPORATION

e. Intangible Assets (excluding lease assets)
Intangible assets are amortized by the straight-line method. Useful lives of the assets are
determined based on the regulations of the Corporation Tax Act.
Software for internal use is amortized over a period of the internal available years (5 years)
using the straight-line method.
f. Lease Assets
Depreciation of lease assets under finance leases that do not transfer ownership of the leaseassets to the lessee is calculated by the straight-line method over the lease term of the leaseassets with no residual value.
Some foreign consolidated subsidiaries prepare their financial statements pursuant to theInternational Financial Reporting Standards. As stated in “Changes in Accounting Policies”, they
have applied International Financial Reporting Standard 16 Leases since the fiscal year ended
March 31, 2020. As a result, lessees recognize all leases as assets and liabilities on the balance
sheet, in principle. Depreciation of right-of-use assets recognized as assets are calculated by thestraight-line method.
g. Allowance for Doubtful Accounts
The allowance for doubtful accounts provided by the Company and its domestic consolidated
subsidiaries is stated in amounts considered to be appropriate based on each company’s pastcredit loss experience and an evaluation of potential losses in the receivables and others
outstanding.
Foreign consolidated subsidiaries provide for such possible losses based on the estimateduncollectible amounts of the specific accounts.
h. Provision for Warranties for Completed Construction
The provision for warranties for completed construction is provided by the Company to cover
expenses for defects claimed concerning completed work based on the estimated amount ofcompensation to be paid in the future for the work completed during the fiscal year which is
calculated by using the results in the past fiscal years.
i. Provision for Loss on Construction Contracts
The provision for loss on construction contracts is provided by the Group with respect toconstruction projects for which eventual losses are reasonably estimated.
j. Provision for Bonuses
The provision for bonuses provided by the Company and its domestic consolidated subsidiaries is
accrued at the year end to which such bonuses are attributable.
k. Accounting for Retirement Benefits
In computing projected benefit obligations, the estimated amounts of retirement benefit obligations
are attributed to periods on a benefit formula basis.
Actuarial differences are amortized commencing in the following year after the differences are
incurred by the straight-line method over a period (12 years) which is shorter than the averageremaining years of service of the employees when incurred.
In determining net defined benefit liability and retirement benefit expenses, certain
consolidated subsidiaries adopt a short-cut method where the amount required for voluntarytermination of employees at the fiscal year end is regarded as projected benefit obligations.
l. Revenue and Cost of Construction Contracts
Revenue of construction contracts is recorded by the percentage-of-completion method for thecompleted portion of the contracts at the balance sheet date, if the outcome of the construction
contract can be reliably estimated and the completed-contract method is applied to othercontracts whose outcome cannot be reliably estimated. The percentage of completion is
calculated based on the cost incurred to date as a percentage of the estimated total cost.
Construction revenue recognized based on the percentage-of-completion method for the year
ended March 31, 2020 was ¥109,342 million ($1,004,704 thousand).

ANNUAL REPORT 202011

m. Cash and Cash Equivalents in the Consolidated Statements of Cash Flows
In preparing the consolidated statements of cash flows, cash and cash equivalents include cash on
hand, readily-available deposits and short-term highly liquid investments with maturities within 3months at the time of acquisition that are exposed to insignificant risk of changes in value.
n. Changes in Accounting Policies(Application of International Financial Reporting Standard (IFRS) 16 Leases)
Subsidiaries that adopt the International Financial Reporting Standards have applied International
Financial Reporting Standard 16 Leases (hereinafter referred to as “IFRS 16”) since the fiscal year
ended March 31, 2020. Accordingly, lessees recognize all leases as assets and liabilities on thebalance sheet, in principle.
As a result, “Property, plant and equipment” increased by ¥80 million ($735 thousand) and“Other” under current liabilities and “Other” under non-current liabilities increased by ¥70 million($643 thousand) and ¥11 million ($101 thousand) respectively, on the Consolidated Balance
Sheets as of March 31, 2020.
The impact of this change on the consolidated statements of income for the year ended March
31, 2020 was immaterial.
In applying IFRS 16, the cumulative effect of the application of the standard was recognized at
the date of initial application pursuant to the transitional treatment.
o. Accounting Standards not yet Applied“Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29, March 31, 2020)“Implementation Guidance on Accounting Standard for Revenue Recognition” (ASBJ Guidance
No. 30, March 31, 2020)
1) Overview
This is a comprehensive accounting standard for revenue recognition. Revenue is recognizedby applying the following 5 steps:
Step 1: Identify the contract with the customer.
Step 2: Identify the performance obligations in the contract.
Step 3: Determine the transaction price.
Step 4: Allocate the transaction price to the performance obligations in the contract.
Step 5: Recognize revenue when or as the entity satisfies each performance obligation.
2) Scheduled date of application
Effective from the beginning of the fiscal year ending March 31, 2022.
3) Effects of the application of the guidance
The Company is currently evaluating the effect of the adoption of this accounting standard andimplementation guidance on its consolidated financial statements.
“Accounting Standard for Fair Value Measurement” (ASBJ Statement No. 30, July 4, 2019)“Implementation Guidance on Accounting Standard for Fair Value Measurement” (ASBJ Guidance
No. 31, July 4, 2019)“Accounting Standard for Measurement of Inventories” (ASBJ Statement No. 9, July 4, 2019)“Accounting Standard for Financial Instruments” (ASBJ Statement No. 10, July 4, 2019)1) Overview
To improve comparability with international accounting standards, the “Accounting Standard for
Fair Value Measurement” and the “Implementation Guidance on Accounting Standard for Fair
Value Measurement” (hereinafter collectively referred to as the “Accounting Standard for Fair
Value Measurement and the Guidance”) were developed and guidance, etc. for fair value
measurement methods were established. The Accounting Standard for Fair Value Measurement
and the Guidance are applied to fair values of the following items.
· Financial instruments under the “Accounting Standard for Financial Instruments”· Inventories held for trading purposes under the “Accounting Standard for Measurement of
Inventories”
2) Scheduled date of application
Effective from the beginning of the fiscal year ending March 31, 2022.
3) Effects of the application of the guidance
The Company is currently evaluating the effect of the adoption of this accounting standard andimplementation guidance on its consolidated financial statements.

12

NAKANO CORPORATION

“Accounting Standard for Accounting Policy Disclosures, Accounting Changes and Error
Corrections” (ASBJ Statement No. 24, March 31, 2020)
1) Overview
This standard is aimed at indicating the principles of adopted accounting treatment and theoverview of procedures when provisions of related accounting standards, etc. are not welldefined.
2) Scheduled date of application
Effective from the end of the fiscal year ending March 31, 2021.
“Accounting Standard for Disclosure of Accounting Estimates” (ASBJ Statement No. 31, March 31,
2020)1) Overview
The standard is aimed at disclosing information that would help users of the financial statements
understand details of accounting estimates that involve the risk of having material impact on thefinancial statements of the following fiscal year among the accounting estimates recorded in thefinancial statements of the fiscal year under review.
2) Scheduled date of application
Effective from the end of the fiscal year ending March 31, 2021.
p. Additional Information(Accounting estimates associated with the spread of the coronavirus disease 2019)
With the global expansion of the coronavirus disease 2019 (COVID-19), some of the Company’s
consolidated subsidiaries in Southeast Asia faced strengthened regulations of local authorities
and other difficulties. As a result, business activities were suspended due to the closure, etc. of
construction sites and offices, which caused a delay in account settlement operations.
Although it is difficult to forecast the future impact of COVID-19, we rationally estimated amounts
for completed construction contracts based on the percentage-of-completion method and suchaccounting estimates as impairment loss on non-current assets and recoverability of deferred tax
assets, in consideration of generally smooth progress in domestic construction work and by taking
into account the resumption of construction work and other factors with regard to construction
works suspended, delayed, etc. at foreign consolidated subsidiaries.
In a case where the business environment changes significantly due to re-expansion,
prolongation, etc. of COVID-19, the Company’s consolidated financial position and financial
performance could be affected in and after the fiscal year ending March 31, 2021.

4.	Notes to

1. The assets pledged as collateral and collateralized liabilities were as follows:
Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

¥102

¥52

200

200

Consolidated
Balance Sheets

As of March 31

Cash and deposits
Notes receivable
Buildings
Land
Investment securities

$

477
1,837

717

703

6,459

6,320

6,320

58,072

1,474

1,189

10,925Total¥8,814¥8,466$77,791

Short-term loans payable

¥270

¥210

$1,929

Long-term loans payable
Total

590

280

2,572

¥860

¥490

$4,502

ANNUAL REPORT 202013

In addition, the following assets were deposited as security for dealing:
Millions of yen
As of March 31

Thousands of
U.S. dollars

2019

2020

2020

9

¥—

$—

Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

Advance payment guarantees¥3,473—¥3,925206$36,065
1,892

Total

¥

¥4,131$37,958

Securities¥

2. The Group was contingently liable for the following:
As of March 31

Guarantees to financial institutions, etc. to ensure
the completion of construction contracts ofNakano Singapore (Pte.) Ltd. and its subsidiaries

3,473

3.	“Costs on uncompleted construction contracts” which are estimated to recognize losses and“Provision for loss on construction contracts” are to be recorded on a gross basis without
offsetting, if any.
4.	The following notes receivable and payable, etc. matured on March 31, 2019 were included in
the respective accounts, since March 31, 2019 fell on a bank holiday;
Millions of yen
As of March 31

Electronically recorded monetary claims
Notes payable
Electronically recorded obligations

5.	Notes toConsolidated
Statements ofIncomeThousands of
U.S. dollars

2019

2020

2020

¥0

¥—

$—

567

—

—

2,256

—

—

1.	Provision for loss on construction contracts included in “Cost of sales of completed construction
contracts” was as follows:
Millions of yen
For the year ended March 31

Provision for loss on construction contracts

Thousands of
U.S. dollars

2019

2020

2020

¥—

¥1

$9

2. The major components of “Selling, general and administrative expenses” were as follows:
Millions of yen
For the year ended March 31

Employees’ salaries and allowances

Thousands of
U.S. dollars

2019

2020

2020

¥2,522¥2,378$21,850

Provision for bonuses

246

227

2,085

Retirement benefit expenses

129

150

1,378

Provision of allowance for doubtful accounts

28

158

1,451

Depreciation

135

181

1,663

3.	Research and development costs included in selling, general and administrative expenses wereas follows:
Millions of yen
For the year ended March 31

Research and development costs

14

NAKANO CORPORATION

Thousands of
U.S. dollars

2019

2020

2020

¥13

¥60

$551

4.	“Gain on sales of non-current assets” consisted of the following:
Millions of yen
For the year ended March 31

VehiclesThousands of
U.S. dollars

2019

2020

2020

¥2

¥16

$147

Other

0

—

—

Total

¥2

¥16

$147

Millions of yen

Thousands of
U.S. dollars

5. “Head office relocation expenses” consisted of the following:
For the year ended March 31

2019

2020

2020

Impairment loss

¥89

¥—

$—

Demolition cost

103

25

229

Other

8

28

257

Total

¥200

¥54

$496

Since the headquarters building classified as jointly used assets is scheduled to be dismantled in line with thedecision to rebuild it, the Group reduced the carrying amounts of the building recorded as non-current assets tomemorandum value, and the reduced amounts were recorded as impairment loss for the fiscal year ended March 31,
2019. With respect to the recoverable amount of these assets, their value in use is regarded as zero because they areplanned to be demolished. The impairment loss is included in “Head office relocation expenses” under extraordinary
loss in the consolidated statements of income for the fiscal year ended March 31, 2019.

6.	Notes toConsolidated
Statements ofComprehensive
IncomeReclassification adjustments and tax effects related to other comprehensive income were as
follows:
For the year ended March 31

Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

¥(302)¥(330)$(3,032)

(0)

5

45

(302)

(325)

(2,986)

91

99

909

(210)

(226)

(2,076)

115

(982)

(9,023)

Valuation difference on available-for-sale securities
Amount arising during the year
Reclassification adjustments
Total before tax effectTax effect
Valuation difference on available-for-sale securities
Foreign currency translation adjustments
Amount arising during the year
Reclassification adjustments
Total before tax effect

—

—

—

115

(982)

(9,023)Tax effect

—

—

—

Foreign currency translation adjustments

115

(982)

(9,023)

Amount arising during the year

(34)

(200)

(1,837)

Reclassification adjustments

Remeasurements of defined benefit plans
59

54

496

Total before tax effect

25

(145)

(1,332)

Tax effect

14

44

404

Remeasurements of defined benefit plans
Total other comprehensive income

39

(101)

(928)

¥(55)¥(1,309)$(12,027)

ANNUAL REPORT 202015

7.	Notes toConsolidated
Statements of Cash
Flows

The reconciliation between “Cash and cash equivalents” reported in the consolidated statementsof cash flows and “Cash and deposits” reported in the consolidated balance sheets was asfollows:
As of March 31

Cash and deposits per consolidated balance sheets
Less: Time deposits maturing over 3 months
Cash and cash equivalents per consolidated statementsof cash flows

8.	Lease Transactions

Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

¥32,329¥22,535$207,066

(728)

(923)

(8,481)¥31,600¥21,612$198,584

1. Finance lease transactions(As lessee)
Finance lease contracts that do not transfer ownership of the lease assets to the lessee1) Contents of lease assets
Property, plant and equipment
Equipment such as computers and vehicles
2) Depreciation of lease assets
As described in NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 3. Summary of Significant
Accounting Policies f. Lease Assets.
2. Operating lease transactions
Future minimum lease payments under non-cancelable operating lease contracts as of March 31,
2019 and 2020 were as follows:
As of March 31

Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

¥105

¥126

$1,157(As lessee)
Due in 1 year
Due after 1 year
Total

178

52

477

¥283

¥178

$1,635

¥14

¥76

$698

(As lessor)
Due in 1 year
Due after 1 year
Total

9.	Financial
Instruments

16

NAKANO CORPORATION

23

257

2,361

¥38

¥334

$3,069

1. Overview
1) Policy for financial instruments
The Group raises operating funds primarily through bank loans and bond issues. Temporary fundsurpluses are managed principally through short-term deposits with little risk. Under the policy of
the Group, the Group uses derivatives only for the purpose of reducing foreign exchange
fluctuation risks associated with foreign currency denominated transactions and interest rate
fluctuation risks associated with loans payable, and not for speculative purposes.

2) Types of financial instruments, risk and risk management
The Group controls risks by type of financial instruments in accordance with the risk management
policy.
Regarding credit risk associated with notes receivable and accounts receivable fromcompleted construction contracts, the Group identifies major customers’ credit status bymonitoring the payment terms and credit balances by each customer.
Regarding securities and investment securities, principally consisting of equity securities, theGroup regularly identifies the quoted market price of the listed securities to manage the risks
arising from market value fluctuations.
The Group manages liquidity risk associated with loans payable by appropriately planning forfund raising based on monthly cash flow projections.
Regarding derivative transactions, the Group executes and controls the transactions based on
the internal control rules which define the transaction authority and limits and enter into contracts
with only the high credit rating financial institutions to reduce credit risk.
3) Supplementary explanation on fair value of financial instruments
The fair value of financial instruments is determined based on the market price or reasonableestimated amount if there is no market price. Certain assumptions are used for calculation of suchfair value, and accordingly, the result of such calculation may vary, if different assumptions areused.
2. Fair value of financial instruments
The carrying amount, fair value and difference of the financial instruments as of March 31, 2019and 2020 were as follows:
Note that the financial instruments whose fair value is extremely difficult to determine were notincluded in the following table (See Note 2 of the below table):
Millions of yen
As of March 31, 2019(1) Cash and deposits(2) Notes receivable, accounts receivable fromcompleted construction contracts and other

Carrying amount

Fair value

Difference¥32,329¥32,329¥—25,682

25,682

—

9

10

0

(3) Securities and investment securities
Held-to-maturity securities
Available-for-sale securities
Assets total(1) Notes payable, accounts payable forconstruction contracts and other

2,036

2,036

—

¥60,058¥60,058¥035,22835,228—(2) Short-term loans payable

810

810

—

(3) Current portion of bonds

1,000

1,000

—

(4) Long-term loans payable

1,030

1,030

—

¥38,068¥38,068

¥—

—

—

—

Liabilities total
Derivative transactions

ANNUAL REPORT 202017

Millions of yen
As of March 31, 2020

Carrying amount

Fair value

Difference(1) Cash and deposits(2) Notes receivable, accounts receivable fromcompleted construction contracts and other(3) Investment securities
Available-for-sale securities¥22,535¥22,535¥—30,39130,391

—

1,705

1,705

—

Assets total¥54,632¥54,632¥—34,236480
720
500

34,236
480
720
500

—
—
—
—

¥35,936—¥35,936—¥——

Carrying amount

Fair value

Difference(1) Cash and deposits(2) Notes receivable, accounts receivable from$207,066$207,066$—completed construction contracts and other(3) Investment securities
Available-for-sale securities

279,252

279,252—(1) Notes payable, accounts payable forconstruction contracts and other(2) Short-term loans payable(3) Long-term loans payable(4) Bonds payable
Liabilities total
Derivative transactions

Thousands of U.S. dollars
As of March 31, 2020

Assets total

15,666

15,666—$501,984$501,984$—314,582
4,410
6,615
4,594

314,582
4,410
6,615
4,594

—
—
—
—

$330,203—$330,203—$——(1) Notes payable, accounts payable forconstruction contracts and other(2) Short-term loans payable(3) Long-term loans payable(4) Bonds payable
Liabilities total
Derivative transactions(Notes): 1.	Method used for determining the fair value of the financial instruments and matters regarding securities
and derivative transactions:
Assets:(1) Cash and deposits and (2) Notes receivable, accounts receivable from completed construction
contracts and other
The carrying amount is presented as the fair value, since the fair value approximates the carrying amountbecause they will be settled within a short period of their maturity.
(3) Securities and investment securities
The fair value of equity securities is determined based on the quoted price of the exchanges, the fair valueof investment trust is determined based on the published standard quotation price and the fair value ofdebt securities is determined based on the published price by the Japan Securities Dealers Association.
Liabilities:(1) Notes payable, accounts payable for construction contracts and other and (2) Short-term loans payable
The carrying amount is presented as the fair value, since the fair value approximates the carrying amountbecause they will be settled within a short period of their maturity.
(3) Long-term loans payable
The carrying amount is presented as the fair value, since the fair value approximates the carrying amountbecause their interest rates will be reset mainly within a short period of their maturity.
(4) Bonds payable
The fair value of bonds issued by the Company is based on the current value of the bonds, which is
calculated by discounting the total amount of principal and interest by an interest rate that reflects theremaining terms of the Company’s bonds and credit risk.

18

NAKANO CORPORATION

2.	Carrying amounts of financial instruments for which it is extremely difficult to identify the fair value were as
follows:
Thousands of
U.S. dollars

Millions of yen
As of March 31

Unlisted equity securities

2019

2020

2020

¥1,207¥1,204$11,063

Above financial instruments were not included in “(3) Securities and investment securities” in the abovetable, since there is no market price and their fair value is extremely difficult to identify.
3.	Redemption schedule for monetary assets and securities with contractual maturities after balance sheet
date was as follows:
Millions of yen

As of March 31, 2019

Due in 1 year
or less

Due after 1
year through5 years

Cash and deposits¥32,329

¥—

¥—

¥—

25,682

—

—

—

9

—

—

—

Notes receivable, accounts
receivable from completed
construction contracts and other
Securities and investment
securities:
Held-to-maturity securities(Japanese government bonds)
Available-for-sale securities with
contractual maturities

Due after 5
years through10 years

Due after 10
years

—

—

4

—

¥58,022

¥—

¥4

¥—

As of March 31, 2020

Due in 1 year
or less

Due after 1
year through5 years

Due after 5
years through10 years

Due after 10
years

Cash and deposits¥22,535

¥—

¥—

¥—

30,391

—

—

—

—

—

2

—

¥52,927

¥—

¥2

¥—

As of March 31, 2020

Due in 1 year
or less

Due after 1
year through5 years

Due after 5
years through10 years

Due after 10
years

Cash and deposits$207,066

$—

$—

$—

279,252

—

—

—

Total

Millions of yen

Notes receivable, accounts
receivable from completed
construction contracts and other
Investment securities
Available-for-sale securities with
contractual maturities
Total

Thousands of U.S. dollars

Notes receivable, accounts
receivable from completed
construction contracts and other
Investment securities:
Available-for-sale securities with
contractual maturities
Total

—

—

18

—

$486,327

$—

$18

$—

ANNUAL REPORT 202019

4.	Repayment schedule of short-term loans payable, long-term loans payable and bonds payable after
balance sheet date was as follows:
Millions of yen
Due after
1 yearthrough
2 years

Due after
2 years
through
3 years

Due after
4 years
through
5 years

Due after
3 years
through
4 years

Due after
5 years

As of March 31, 2019

Due in 1
year or less

Short-term loans payable¥810 ¥— ¥— ¥— ¥— ¥—Long-term loans payable
Current portion of bonds
Total

—

310

310

210

50

150

1,000

—

—

—

—

—

¥1,810 ¥310 ¥310 ¥210 ¥50 ¥150
Millions of yen
Due after
1 yearthrough
2 years

Due after
2 years
through
3 years

Due after
4 years
through
5 years

Due after
3 years
through
4 years

Due after
5 years

As of March 31, 2020

Due in 1
year or less

Short-term loans payable¥480 ¥— ¥— ¥— ¥— ¥—Long-term loans payable

—

310

210

50

50

100

Bonds payable

—

—

500

—

—

—

Total

¥480 ¥310 ¥710 ¥50 ¥50 ¥100
Thousands of U.S. dollars
Due after
2 years
through
3 years

Due after
3 years
through
4 years

Due after
4 years
through
5 years

Due after
5 years

As of March 31, 2020

Due in 1
year or less

Short-term loans payable$4,410 $— $— $— $— $—Long-term loans payable

—

2,848

1,929

459

459

918

Bonds payable

—

—

4,594

—

—

—

Total

10. Securities

Due after
1 yearthrough
2 years$4,410 $2,848 $6,523 $459 $459 $918

1. Investment securities as of March 31, 2019 and 2020 consisted of the following:
Millions of yen
As of March 31

Held-to-maturity securities
Available-for-sale securities with market value
Total

Thousands of
U.S. dollars

2019

2020

2020

¥9

¥—

$—

2,036

1,705

15,666¥2,046¥1,705$15,666

2.	The carrying amount and fair value of held-to-maturity debt securities as of March 31, 2019 and2020 were as follows:
Millions of yen
As of March 31, 2019

Carrying amount

Fair value

Difference

1) Securities with fair value exceeding carrying amount
¥9

¥10

¥0

2) Securities with carrying amount exceeding fair value

¥—

¥—

¥—

Total

¥9

¥10

¥0

Japanese government bonds

As of March 31, 2020

Not applicable

20

NAKANO CORPORATION

3.	The carrying amount (fair value) and acquisition cost of available-for-sale securities as of March
31, 2019 and 2020 were as follows:
Millions of yen
As of March 31, 20191) Securities with carrying amount exceedingacquisition cost
Equity securities

Carrying amount

Acquisition cost

Difference¥1,938¥723¥1,2154

12¥1,942¥725¥1,217

¥93

¥116

¥(22)

Other
Subtotal2) Securities with acquisition cost exceeding
carrying amount
Equity securities
Subtotal
Total

¥93

¥116

¥(22)¥2,036¥841¥1,195

Carrying amount

Acquisition cost

Difference¥1,511

¥588

¥922

Millions of yen
As of March 31, 20201) Securities with carrying amount exceedingacquisition cost
Equity securities
Other
Subtotal2) Securities with acquisition cost exceeding
carrying amount
Equity securities
Subtotal
Total

2

1

0

¥1,513

¥590

¥923

¥191

¥245

¥(54)

¥191

¥245

¥(54)¥1,705

¥835

¥869

Carrying amount

Acquisition cost

Difference$13,884$5,402$8,471

Thousands of U.S. dollars
As of March 31, 20201) Securities with carrying amount exceedingacquisition cost
Equity securities
Other
Subtotal2) Securities with acquisition cost exceeding
carrying amount
Equity securities
Subtotal
Total

18

9

9

$13,902$5,421$8,481$1,755$2,251$(496)$1,755$2,251$(496)$15,666$7,672$7,984(Note)	“Unlisted equity securities” in an amount of ¥1,207 million as of March 31, 2019 and ¥1,204 million ($11,063
thousand) as of March 31, 2020 were not included in available-for-sale securities in the above table, since there
is no market price and their fair value is extremely difficult to identify.

4.	Available-for-sale securities which were sold during the years ended March 31, 2019 and 2020
were as follows:
For the year ended March 31, 2019:
There were no Available-for-sale securities which were sold.
For the year ended March 31, 2020:
There were no Available-for-sale securities which were sold.

ANNUAL REPORT 202021

5.	Securities on which impairment loss was recognized during the years ended March 31, 2019and 2020 were as follows:
For the year ended March 31, 2019:
There were no securities on which impairment loss was recognized.
For the year ended March 31, 2020:
The Group recognized impairment loss on available-for-sale securities in amount of ¥5 million ($45
thousand).
If the fair value of available-for-sale securities with fair value declines by 30% to 50% of theacquisition cost, the Company judges the recoverability, considering the current status of theissuing Companies and the fair value trends, and recognizes impairment loss, unless the recovery
is reasonably expected.

11.	Retirement
Benefits

1. Outline of the Company’s retirement benefit plans
The Company has defined benefit plans that consist of a defined benefit corporate pension plan
and a lump-sum retirement benefit plan and also defined contribution pension plans. Certain
consolidated subsidiaries have unfunded defined benefit plans and lump-sum benefit plans.
Furthermore, the Group may pay additional retirement benefits upon the retirement of certain
employees.
With respect to lump-sum benefit plans adopted by certain consolidated subsidiaries, net
defined benefit liability and retirement benefit expenses are calculated by the short-cut method.
2. Defined Benefit Plans
1)	The changes in projected benefit obligations for the years ended March 31, 2019 and 2020 wereas follows (excluding the plans to which a short-cut method was applied):
For the year ended March 31

Beginning balance of projected benefit obligations
Service cost

Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

¥4,240¥4,274$39,272

268

268

2,462

Interest cost

21

17

156

Actuarial differences

11

(16)

(147)

(266)

(436)

(4,006)Extra retirement payments of subsidiaries

—

(37)

(339)

Other

(0)

(18)

(165)

¥4,274¥4,050$37,214

Retirement benefits paid

Ending balance of projected benefit obligations2)	The changes in plan assets for the years ended March 31, 2019 and 2020 were as follows(excluding the plans to which a short-cut method was applied):
Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

Beginning balance of plan assets¥3,945¥4,119$37,848

Expected return of plan assets

78

82

753

(2)

(203)

(1,865)

345

312

2,866

For the year ended March 31

Actuarial differences
Contribution from the employer
Retirement benefits paid
Ending balance of plan assets

22

NAKANO CORPORATION

(247)

(416)

(3,822)¥4,119¥3,895$35,7893)	The changes in net defined benefit liability of the plans to which the short-cut method wasapplied for the years ended March 31, 2019 and 2020 were as follows:
Millions of yen
For the year ended March 31

Thousands of
U.S. dollars

2019

2020

2020

¥83

¥80

$735

Retirement benefit expenses

6

37

339

Retirement benefits paid

(8)

(5)

(45)

¥80

¥113

$1,038

Beginning balance of net defined benefit liability

Ending balance of net defined benefit liability4)	Reconciliation between the ending balances of projected benefit obligations and plan assets andnet defined benefit liability and net defined benefit asset recorded in the consolidated balance
sheet as of March 31, 2019 and 2020 was as follows:
Millions of yen
As of March 31

Funded projected benefit obligations
Plan assets
Net
Unfunded projected benefit obligations

Thousands of
U.S. dollars

2019

2020

2020

¥4,088¥3,926$36,074(4,119)(3,895)(35,789)¥(30)

¥31

$284

266

237

2,177

Net liability recorded in the consolidated balance
sheet

¥235

¥268

$2,462

Net defined benefit liability

¥266

¥268

$2,462

Net defined benefit asset

(30)

—

—

¥235

¥268

$2,462

Net liability recorded in the consolidated balance
sheet(Note) Above amounts include plans to which the short-cut method is applied.

5)	The components of retirement benefit expenses for the years ended March 31, 2019 and 2020
were as follows:
For the year ended March 31

Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

Service cost

¥268

¥268

$2,462Interest cost

21

17

156

Expected return of plan assets

(78)

(82)

(753)

Amortization of actuarial differences

38

40

367

Retirement benefit expenses computed byshort-cut method

6

37

339

Extra retirement payments of subsidiaries

—

103

946

Other

(0)

(18)

(165)

¥255

¥366

$3,363

Retirement benefit expenses on defined benefit
plans

ANNUAL REPORT 2020236)	The component of “Remeasurements of defined benefit plans” under “Other comprehensive
income” (before adjusting for tax effects) for the years ended March 31, 2019 and 2020 was asfollows:
For the year ended March 31

Actuarial differences

Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

¥25

¥(145)$(1,332)

7)	The component of “Remeasurements of defined benefit plans” under “Accumulated othercomprehensive income” (before adjusting for tax effects) as of March 31, 2019 and 2020 was asfollows:
As of March 31

Unrecognized actuarial differences

Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

¥(46)¥(192)$(1,764)

8) Plan assets
a. Components of plan assets
Plan assets as of March 31, 2019 and 2020 consisted of the following:
As of March 31

2019

2020

Bonds

45%

58%

Equity securities

43

29

Insurance assets (general account)

10

10

Other

2

3

Total

100

100

b.	Method of determining the long-term expected rate of return on plan assets
	The long-term expected rate of return on plan assets is determined considering allocation ofplan assets which are expected currently and in the future and the long-term rates of return
which are expected currently and in the future from the various components of the plan
assets.
9)	Actuarial assumptions used for the years ended March 31, 2019 and 2020 were set forth asfollows:
For the year ended March 31

2019

2020

Discount rate

0.1%

0.1%

Long-term expected rate of return on plan assets

2.0

2.0

3. Defined Contribution Plans
The amount of the required contribution to the defined contribution plans of the Company for theyears ended March 31, 2019 and 2020 was as follows:
For the year ended March 31

Required contribution to the defined contribution
plans

24

NAKANO CORPORATION

Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

¥70

¥71

$652

12.	Deferred Tax
Accounting

1.	The significant components of deferred tax assets and liabilities as of March 31, 2019 and 2020
were as follows:
Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

Tax loss carryforwards

¥5

¥87

$799

Provision for bonuses

183

165

1,516

As of March 31

Deferred tax assets:

Net defined benefit liability

18

35

321

Allowance for doubtful accounts

11

44

404

Loss on valuation of real estate for sale

287

287

2,637

Accounts payable for construction contracts

195

55

505

1,359

1,355

12,45058——

Impairment loss
Head office relocation expenses
Other

443

394

3,620

Subtotal

2,564

2,425

22,282

Less: valuation allowance (Note)
Deferred tax assets(1,997)(1,885)(17,320)

¥566

¥540

$4,961¥(371)¥(272)$(2,499)

(424)

(410)

(3,767)(9)——

Deferred tax liabilities:
Valuation difference on available-for-salesecurities
Undistributed earnings of foreign consolidated
subsidiaries
Net defined benefit asset

(45)

(57)

(523)

Deferred tax liabilities

Other¥(850)¥(739)$(6,790)

Net deferred tax liabilities¥(284)¥(199)$(1,828)(Note) Valuation allowance decreased by ¥112 million ($1,029 thousand). The major reason for this decrease is thatthe valuation allowance for accounts payable for construction contracts decreased by ¥140 million ($1,286
thousand) in the consolidated subsidiary Nakano Singapore (Pte.) Ltd.

2.	Reconciliation between the normal effective statutory tax rates and the actual effective tax rates
reflected in the consolidated statements of income as of March 31, 2019 and 2020 was asfollows:
As of March 31

2019

2020

Normal effective statutory tax rate

30.6%

30.6%

Expenses not deductible income tax purposes

0.6

0.7

Tax rate differences in foreign consolidated subsidiaries

(2.0)

(2.3)

Undistributed earnings of foreign consolidated subsidiaries

0.4

(0.3)

Inhabitant per capita taxes

0.6

0.8

Income taxes for prior periods

0.5

1.3

Valuation allowance

(2.4)

(3.1)

Other

0.3

1.2

Actual effective tax rate

28.6

28.9

ANNUAL REPORT 202025

13.	Investment andRental Properties

1.	The Company and certain consolidated subsidiaries own office buildings, commercial facilities
and residual units for lease in Tokyo and other areas. Rental income from these real estate
properties for lease for the years ended March 31, 2019 and 2020 were ¥672 million and ¥732
million ($6,726 thousand), respectively. Rental income and related costs were included in “Sales
on real estate business” and “Cost of sales on real estate business”, respectively, in theaccompanying consolidated statements of income for the years ended March 31, 2019 and2020.
2.	The carrying amounts, changes in such balances during the year and fair values of suchproperties were as follows:
As of March 31

Carrying amounts(Note 1):

Beginning balance
Increase (decrease) (Note 2)
Ending balance

Fair value (Note 3)

Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

¥11,384¥12,787$117,495

1,403

2

18

¥12,787¥12,789$117,513¥17,014¥17,852$164,035(Notes): 1. The carrying amount is presented after deducting accumulated depreciation from the acquisition cost.
2.	Increase during the year ended March 31, 2019 primarily represents the acquisition of real estate of ¥1,566
million and decrease is primarily due to depreciation of ¥121 million.
	Increase during the year ended March 31, 2020 primarily represents the acquisition of real estate of ¥214
million ($1,966 thousand) and decrease is primarily due to depreciation of ¥141 million ($1,295 thousand)and effect of change in exchange rate of ¥70 million ($643 thousand).
3.	The fair values of major properties are determined based on the real estate appraisal value by independent
real estate appraisers and the fair values of other properties are determined based on the value inaccordance with “Japanese Real Estate Appraisal Standard” or based on reasonable internal appraisal.

14.	Segment
Information

1.	Description of reportable segments
The Group’s reportable segments are those for which separate financial information is available
and regular evaluation by the Board of Directors is being performed in order to decide how
resources are allocated among the Group.
The Group is active in the construction business and the real estate business in Japan andforeign countries.
Therefore, the Group consists of regional segments which are based on each business.
Reportable segments of the construction business are “Japan” and “Southeast Asia (Singapore,
Malaysia, Indonesia, Thailand and Vietnam)”, and those of the real estate business are “Japan”
and “Southeast Asia (Singapore and Malaysia)”.
In addition, following the acquisition of leased real estates by Nakano Construction SDN.BHD.
in Malaysia, Malaysia is included in “Real estate (Southeast Asia)”, the reportable segment, fromthe year ended March 31, 2020.
2.	Methods of measurement for the amounts of sales, income (loss), assets and other items foreach reportable segment
The accounting policies of each reportable segment are consistent to those disclosed in Note 3,“Summary of Significant Accounting Policies”.
As stated in “Changes in Accounting Policies”, subsidiaries that adopt the International
Financial Reporting Standards have applied International Financial Reporting Standard 16 Leases
since the fiscal year ended March 31, 2020.
The impact of this change on segment income for the year ended March 31, 2020 isimmaterial.

26

NAKANO CORPORATION

3.	Information on sales, income (loss), assets and other items for each reportable segment was asfollows:
Millions of yen
Reportable segments
Construction
For the year ended
March 31, 2019

Southeast
Japan
Asia

Total

Real estateSoutheast
Japan
Asia

Other
(Note 1)

Total

Adjustments Consolidated(Note 2)
(Note 3)Total

Net sales:
Customers
Inter-segment
Total¥85,077 ¥30,893 ¥115,970 ¥1,048 ¥28 ¥1,076¥105 ¥117,152 ¥— ¥117,152

19

—

19

0

—

0

—

20

(20)

—

85,09630,893

115,989

1,049

28

1,077

105

117,173(20)

117,152

Segment income

4,381

493

4,874

554

14

569

32

5,476

—

5,476

Segment assets

25,46821,501

46,97012,486

1,098

13,584397

60,952

23,49784,450

Other items:
Depreciation¥95 ¥53 ¥149 ¥118 ¥6 ¥125¥39 ¥314 ¥— ¥314

Impairment loss

83

10

93

0

—

0

0

94

—

94

Increase in property,
plant, and equipment
and intangible assets

198

27

225

1,410

54

1,464

0

1,690

—

1,690

(Notes): 1.	‌“Other” is a business segment not included in the reportable segments, which consists of solar power
generation business and insurance agent business.
2.	An adjustment of “Segment assets” in an amount of ¥23,497 million was corporate assets which were notallocated to each reportable segment and consisted of surplus fund (cash and deposits) and long-term
investment fund (investment securities and insurance funds) of the Company.
3.	Segment income is reconciled with operating income in the accompanying consolidated statements ofincome.
Millions of yen
Reportable segments
Construction
For the year ended
March 31, 2020

Southeast
Japan
Asia

Total

Real estateSoutheast
Japan
Asia

Other
(Note 1)

Total

Adjustments Consolidated(Note 2)
(Note 3)Total

Net sales:
Customers
Inter-segment
Total¥77,504 ¥38,187 ¥115,691 ¥1,150 ¥26 ¥1,177 ¥109 ¥116,977 ¥— ¥116,977
0

—

0

1

—

1

—

1

(1)

—

77,50438,187

115,691

1,151

26

1,178

109

116,979(1)

116,977

Segment income

3,027

408

3,435

622

13

636

33

4,104

—

4,104

Segment assets

31,14023,561

54,701

12,515

1,036

13,551352

68,605

12,744

81,349Other items:
Depreciation
Increase in property,
plant, and equipment
and intangible assets¥104 ¥189 ¥294 ¥139 ¥6 ¥145 ¥35 ¥474 ¥— ¥474

263

249

512

119

68

188

1

702

—

702

Thousands of U.S. dollars
Reportable segments
Construction
For the year ended
March 31, 2020

Southeast
Japan
Asia

Total

Real estateSoutheast
Japan
Asia

Other
(Note 1)

Total

Adjustments Consolidated(Note 2)
(Note 3)Total

Net sales:
Customers
Inter-segment
Total$712,156 $350,886 $1,063,043 $10,566 $238 $10,815 $1,001 $1,074,859 $— $1,074,859
0

—

0

9

—

9

—

9

712,156

350,886

1,063,043

10,576238

10,824

1,001

1,074,878(9)—(9) 1,074,859

Segment income

27,814

3,748

31,562

5,715

119

5,843

303

37,710—37,710

Segment assets

286,134

216,493502,627

114,995

9,519

124,5153,234

630,386

117,100

747,486

Other items:
Depreciation
Increase in property,
plant, and equipment
and intangible assets$955 $1,736 $2,701 $1,277 $55 $1,332 $321 $4,355 $— $4,355

2,416

2,287

4,704

1,093

624

1,727

9

6,450

—

6,450

ANNUAL REPORT 2020

27

(Notes): 1.	“Other” is a business segment not included in the reportable segments, which consists of solar power
generation business and insurance agent business.
2.	An adjustment of “Segment assets” in an amount of ¥12,744 million ($117,100 thousand) was corporate
assets which were not allocated to each reportable segment and consisted of surplus fund (cash anddeposits) and long-term investment fund (investment securities and insurance funds) of the Company.
3.	Segment income is reconciled with operating income in the accompanying consolidated statements ofincome.

15.	Per ShareInformation

Basic net income per share is computed based on the weighted average number of shares ofcommon stock outstanding during the year. Diluted net income per share was not presented forthe years ended March 31, 2019 and 2020 since the Company had no potentially dilutive shares
outstanding as of the balance sheet dates.
Net assets per share is computed based on the number of shares of common stock
outstanding as of the balance sheet dates.
Net assets and net income per share for the years ended March 31, 2019 and 2020 were as
follows:
Yen

U.S. dollars

For the year ended March 31

2019

2020

2020

Net assets per share¥961.56¥996.50$9.16116.09

85.33

0.78

Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

¥34,352¥35,532$326,490

Basic net income per share(Notes): 1. Net assets per share was calculated based on the following information:

As of March 31

Total net assets
Deductions from total net assets:(1,302)(1,282)(11,779)

Net assets attributable to common stock¥33,049¥34,249$314,701

Number of shares of common stock usedin computing net assets per share(in thousand shares)

34,37134,36934,369Millions of yen

Thousands of
U.S. dollars

Non-controlling interests

2. Net income per share was calculated based on the following information:

For the year ended March 31

Profit attributable to owners of parent
Amount not attributable to common stock
shareholders
Profit attributable to common stock ofowners of parent
Average number of shares of common
stock during the year (in thousand shares)

16. Bonds Payable

2019

2020

2020

¥3,990¥2,932$26,941———¥3,990¥2,932$26,941

34,372

34,37034,370Bonds payable as of March 31, 2019 and 2020 consisted of the following:
Millions of yen

Issuer and Issue type

Thousands of
U.S. dollars

2020

2020

Interest
rate(%)

Collateral

Maturity

Mar.10, 2017 ¥1,000 ¥—

$—

0.69

None

Mar. 10, 2020

500

4,594

0.34

None

Mar. 10, 2023

¥1,000 ¥500$4,594

Issue date

2019

(Nakano Corporation)
8th unsecured bond(Nakano Corporation)
9th unsecured bond
Total

28

NAKANO CORPORATION

Mar.10, 2020—

(Notes): The following was a summary of maturities of bonds subsequent to March 31, 2020:
Years ending March 31

Millions of yen

Thousands of
U.S. dollars

2021

¥—

$—

2022

—

—

2023

500

4,594

2024

—

—

2025

—

—

2026 and thereafter
Total

—

—

¥500

$4,59417.	Loans Payable and Short-term loans payable, long-term loans payable and other debts as of March 31, 2019 andOther Debts

2020 were as follows:

As of March 31

Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

Averageinterest rate(%)

Maturity

Short-term loans payable

¥200

¥170

$1,562

1.02—

Current portion of
long-term loans payable

610

310

2,848

0.96

—

Current portion of leaseobligations

7

108

992

—

—

Long-term loans payable
excluding current portion

1,030

720

6,615

May.31, 2021 –0.97 Feb. 25, 2027

Lease obligations
excluding current portion

0

99

909

Apr. 30, 2021 –— Oct. 31, 2025

¥1,848¥1,407$12,928

Total

—

—

(Notes):1.	“Average interest rate” represents the weighted average interest rate on loans payable outstanding as of
the balance sheet date. “Average interest rate” of lease obligations is not shown since interest equivalentamounts included in the aggregated lease premiums are allocated to each fiscal year using the straightline method.
2.	The following was a summary of annual maturities of loans payable and lease obligations subsequent toMarch 31, 2020:
Millions of yen
Years ending March 31

Lease
obligations

Long-termloans payableLease
obligations

2021

¥310

¥108

$2,848

$992

2022

310

43

2,848

395

2023

210

39

1,929

358

2024

50

14

459

128

2025

50

1

459

9

2026 and thereafterTotal

18.	Subsequent
EventsThousands of U.S. dollars

Long-termloans payable

100

—

918

—

¥1,030¥207$9,464$1,902

At the Annual General Meeting of Shareholders held on June 26, 2020, it was resolved to distributethe year-end cash dividends of ¥14 ($0.13) per share of common stock of the Company.
The aggregate amount of such cash dividends was ¥481 million ($4,419 thousand).

ANNUAL REPORT 2020

29

SUPPLEMENTAL INFORMATIONNONCONSOLIDATED BALANCE SHEETSNAKANO CORPORATIONAs of March 31, 2019 and 2020

AssetsCurrent assets:
Cash and deposits
Notes receivable - trade
Accounts receivable from completed construction contracts
Costs on uncompleted construction contracts
Costs on real estate business
Raw materials and supplies
Short-term loans receivable from subsidiaries and affiliates
Accounts receivable - otherConsumption taxes receivable
Other
Allowance for doubtful accounts
Total current assets
Non-current assets:
Property, plant and equipment
Buildings
Accumulated depreciation
Buildings, net
Structures
Accumulated depreciation
Structures, net
Machinery and equipment
Accumulated depreciation
Machinery and equipment, net
VehiclesAccumulated depreciation
Vehicles, net
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net
Land
Lease assets
Accumulated depreciation
Lease assets, net
Construction in progress
Total property, plant and equipment
Intangible assets
Total intangible assets
Investments and other assets
Investment securities
Stocks of subsidiaries and affiliates
Long-term loans receivable from subsidiaries and affiliates
Insurance funds
Prepaid pension cost
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

30

NAKANO CORPORATION

Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

¥21,239
1,040
15,702
1,377
43
6
15
2,629
—
475
—
42,529¥11,310
1,433
19,452
1,458
43
6
15
1,332
2,202
567
(78)
37,743$103,923
13,167
178,737
13,397395
55
137
12,23920,233
5,209(716)
346,806

7,433(4,077)
3,356
147
(126)
21
569
(281)
287
11
(9)
1
362
(309)
52
11,17047(39)
7—
14,897

6,938(3,593)
3,345
147
(130)
16
560
(307)
252
11
(10)
0
296
(227)
69
11,170
145
(30)
115
49
15,02263,750(33,014)30,736
1,350(1,194)147
5,145(2,820)
2,315
101
(91)
0
2,719
(2,085)
634
102,637
1,332
(275)
1,056
450
138,031

205

194

1,782

2,051
2,428
105
31
77
158
378
(36)
5,194
20,296¥62,826

1,708
2,425
90
31
161
100
313
(13)
4,817
20,034¥57,778

15,694
22,282
826
284
1,479
918
2,876
(119)
44,261
184,085$530,901

Liabilities
Current liabilities:
Notes payable – trade
Electronically recorded obligations - operating
Accounts payable for construction contracts
Short-term loans payable
Current portion of bonds
Lease obligations
Income taxes payable
Accrued consumption taxes
Advances received on uncompleted construction contracts
Provision for warranties for completed construction
Provision for loss on construction contracts
Provision for bonuses
Other
Total current liabilities
Non-current liabilities:
Bonds payable
Long-term loans payable
Lease obligations
Provision for retirement benefits
Long-term deposits received
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity:
Common stock
Authorized: 154,792,300 shares
Issued:34,498,097 shares
Capital surplus
Legal capital surplus
Total capital surplus
Retained earnings
Other retained earnings
Retained earnings brought forward
Total retained earnings
Less: Treasury stock, at cost
126,779 shares in 2019 and 128,323 shares in 2020
Total shareholders’ equity
Valuation and translation adjustments:
Valuation difference on available-for-sale securities
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets

Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

¥3,511
11,082
12,560
810
1,000
7
1,305
1,875
5,553
272
—
593
831
39,403¥2,112
8,983
13,142
480
—
37
272
—
6,124
255
1
532
550
32,492$19,406
82,541
120,757
4,410
—
339
2,499
—
56,271
2,343
9
4,888
5,053
298,557

—
1,030
0
23
497
119
1,671
41,074

500
720
87
31
548
120
2,008
34,500

4,594
6,615
799
284
5,035
1,102
18,450317,008¥5,061¥5,061$46,503

1,400
1,400

1,400
1,400

12,864
12,864

14,585
14,585

16,347
16,347150,206
150,206(33)
21,013(34)
22,775(312)
209,271

737
737
21,751

502
502
23,277

4,612
4,612
213,884¥62,826¥57,778$530,901
ANNUAL REPORT 2020

31

NONCONSOLIDATED STATEMENTS OF INCOME
NAKANO CORPORATION
For the years ended March 31, 2019 and 2020

Millions of yen

Thousands of
U.S. dollars

2019

2020

2020

¥85,096¥77,504$712,156

Sales on real estate business

986

1,090

10,015

Sales on other business

74

72

661

86,15778,667

722,842

76,76570,399646,871

411

457

4,199

Net sales:
Net sales of completed construction contracts

Total net sales
Cost of sales:
Cost of sales of completed construction contracts
Cost of sales on real estate business
Cost of sales on other businessTotal cost of sales

47

43

395

77,22470,899651,465

8,331

7,105

65,285

575

633

5,816

Gross profit:
Gross profit on completed construction contracts
Gross profit - real estate business
Gross profit - other business

26

28

257

8,933

7,768

71,377

4,209

4,343

39,906

4,724

3,424

31,461

Interest income

30

30

275

Dividend income

51

53

486

Foreign exchange gains

60

—

—

Total gross profit
Selling, general and administrative expenses
Operating income
Non-operating income:

Other

31

17

156

173

101

928

Interest expenses

21

15

137

Interest on bonds

7

6

55

Foreign exchange losses

—

28

257

Bond issuance cost

—

15

137

Total non-operating income
Non-operating expenses:

Other

0

1

9

29

67

615

4,868

3,458

31,774

—

17

156

—

17

156

Loss on litigation

35

79

725

Head office relocation expenses

200

54

496

Total non-operating expenses
Ordinary income
Extraordinary income:Gain on liquidation of subsidiaries and associates
Total extraordinary income
Extraordinary losses:

Other

0

4

36

236

137

1,258

4,631

3,339

30,680

Income taxes - current

1,424

933

8,573

Income taxes - deferred

45

162

1,488

Total extraordinary losses
Profit before income taxes
Income taxes:

Total income taxes
Profit32

NAKANO CORPORATION

1,470

1,095

10,061¥3,161¥2,243$20,610

CORPORATE PROFILECONTENTS

Company Outline (As of March 31, 2020)

FINANCIAL HIGHLIGHTS

1

REPORT OF INDEPENDENT AUDITORS

2

CONSOLIDATED BALANCE SHEETS

4CONSOLIDATED STATEMENTS OF INCOME

6

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

7

CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS

8

CONSOLIDATED STATEMENTS OF CASH FLOWS

9NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

10

SUPPLEMENTAL INFORMATION

30

Company Name
Headquarters
Foundation
Established
Capitalization
Employees
Stock Listing
Primary Business

Board of Directors (As of September 17, 2020)

NONCONSOLIDATED BALANCE SHEETS

30

NONCONSOLIDATED STATEMENTS OF INCOME

32

Honorary Chairman
Vice Chairman
President
Directors

33

Outside Directors

CORPORATE PROFILE

NAKANO CORPORATION
Sumitomoichigaya Building 8F 1-1, Ichigayahonmura-cho, Shinjuku-ku, Tokyo 162-0845, Japan
February 8, 1933
December 19, 1942
¥5,061,678,686
1,361(Group)Tokyo Stock Exchange, First Section
Domestic Construction Projects
International Construction Projects
Real Estate BusinessStanding Corporate Auditors
Corporate Auditors

Yoshikazu Oshima
Akira Asai
Toshiyuki Taketani
Yorinobu Kato
Tetsuo Sato
Moriyasu Kawamura
Mitsuharu Kotaka
Akihiko Sugaya
Kohei Yamaya

Hiroyuki Tanada
Makoto Fukuda
Koichiro Nakano
Hideaki Sekizawa

Main Affiliated Financial Institutions
MUFG Bank, Ltd.
The Shoko Chukin Bank, Ltd.
The Shizuoka Bank, Ltd.
The Musashino Bank, Ltd.

Mizuho Bank, Ltd.
The Bank of Yokohama, Ltd.
The Yamanashi Chuo Bank, Ltd.
The Joyo Bank, Ltd.

Major Shareholders
Oshima Scholarship Foundation
Yoshikazu Oshima
MB Service Co., Ltd.

Kanto Kogyo Co., Ltd.
Marine Dream Co., Ltd.
MUFG Bank, Ltd.

Domestic Offices
Headquarters
Tohoku Regional OfficeOsaka Regional Office
Civil Engineering Office
Hokkaido Branch Office
Kita Kanto Branch Office
Yokohama Branch Office

Tokyo Main Office
Nagoya Regional Office
Kyushu Regional Office
Taito Branch Office
Kita Tohoku Branch Office
Higashi Kanto Branch Office
Sales Offices (Mie, Kita Kyushu)

International Offices
Nakano Singapore (Pte.) Ltd. (Singapore)
PT. Indonakano (Indonesia)
Nakano Vietnam Co., Ltd. (Vietnam)

Cautionary remarks regarding forward looking statements
This Annual Report includes forward-looking statements that represent Nakano Corporation’s assumptions and expectations inlight of currently available information. These statements reflect industry trends, client’s situations and other factors, and involverisks and uncertainties which may cause actual performance results to differ from those discussed in the forward looking
statements in accordance with changes in the domestic and international business environment.
For further information contact:
Nakano Corporation International Operations Headquarters
Sumitomoichigaya Building 8F 1-1,
Ichigayahonmura-cho, Shinjuku-ku, Tokyo, 162-0845, Japan
Tel: +81-(0)3-6774-8594 Fax: +81-(0)3-6774-8615
https://www.wave-nakano.co.jp

Nakano Construction Sdn. Bhd. (Malaysia)
Thai Nakano Co., Ltd. (Thailand)

Industry Affiliations
Japan Federation of Construction Contractors
The Associated General Contractors of Tokyo
General Contractors Association of Osaka

National General Contractors Association of Japan
Japan Association of Representative General Contractors

ANNUAL REPORT 202033

Annual Report 2020
Fiscal year ended March 31, 2020

Sumitomoichigaya Building 8F 1-1, Ichigayahonmura-cho,Shinjuku-ku,Tokyo, 162-0845, Japan
Tel: +81-(0)3-6774-8594 Fax: +81-(0)3-6774-8615
https://www.wave-nakano.co.jp
SINGAPORE
1 Coleman St., #06-02 The Adelphi, 179803, Singapore
Tel: +65-6333-4933
Fax: +65-6338-8568

MALAYSIA
Block B, 15-4-2, Megan Salak Park Jalan 1/125E, Taman Desa Petaling, Kuala Lumpur 57100, Malaysia
Tel: +60-3-9059-6977
Fax: +60-3-9059-6277

INDONESIA
Tamara Center 14th Floor Jl. Jend. Sudirman KAV. 24, Jakarta 12920, Indonesia
Tel: +62-21-5203674
Fax: +62-21-5203670

THAILAND
2170 Bangkok Tower, 17th Floor New Petchburi Road, Bangkapi, Huaykwang, Bangkok 10310 Thailand
Tel: +66-2-308-0500
Fax: +66-2-308-0497

VIETNAM
Unit 1411-1412, 14th Floor, Daeha Business Center, 360 Kim Ma Street, Ngoc Khanh Ward, Ba Dinh District, Hanoi, Vietnam
Tel: +84-243-724-7552
Fax: +84-243-724-7553