Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2011 (J-GAAP)
August 10, 2010
Name of listed company: Nichii Gakkan Company
Listed on: Tokyo Stock Exchange 1st Section
Securities code: 9792
URL: http://www.nichiigakkan.co.jp
Representative: Daisuke Terada, President and Representative Director
Contact:
Koichi Terada, Director, Vice President of Accounting and Finance Division
TEL: 03-3291-2121
Scheduled date of filing quarterly financial report:
August 12, 2010
Scheduled date to start dividends distribution―
Supplementary quarterly materials prepared: Yes
Quarterly results information meeting held: None
(Figures shown are rounded down to the nearest million yen.)

1. Consolidated financial results for the first quarter ended June 30, 2010 (April 1, 2010 – June 30, 2010)(1) Consolidated operating results(Percentage figures represent changes from the same period in the previous year.)

Net Sales

Operating Income

Ordinary Income

Net Income

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

59,468

5.9

1,721

64.5

1,834

85.4

523

380.4

56,174

6.4

1,046

—

989

—

109

—

Three months ended
June 30, 2010
Three months ended
June 30, 2009

Net Income per Share

Diluted Net Income
per Share

Yen

Three months ended
June 30, 2010
Three months ended
June 30, 2009

Yen

7.58

—

1.57

—

(2) Consolidated financial position
Total Assets

Net Assets

Millions of yen

Reference: Shareholders’ equity:

Net Assets per Share

Millions of yen

119,698
119,081

As of June 30, 2010
As of March 31, 2010

Equity Ratio%

49,77849,728

As of June 30, 2010: 49,550 million yen

Yen

41.4
41.6

717.48716.81

As of March 31, 2010: 49,504 million yen

2. Dividends
Annual Dividends (Yen)First Quarter

Second Quarter

Third Quarter

—
—

6.00

—

6.00

12.00

7.00

—

7.00

14.00

Year ended March 31, 2010
Year ending March 31, 2011
Year ending March 31, 2011
(Forecast)Year-End

AnnualNote: Revision in the forecast of dividends during the current quarter: None

3. Consolidated financial result forecasts for the year ending March 31, 2011 (April 1, 2010 – March 31, 2011)(Percentage figures indicate the rate of change from the same period in the previous year.)

Net SalesFirst six months
Full year

Operating Income

Ordinary Income

Net Income
per Share

Net Income

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

Yen

119,300
240,000

5.9
2.0

3,500
8,000

45.9
16.5

3,500
8,300

52.6
20.7

1,100
3,500

62.3
10.9

15.93
50.68

Note: Revision of the forecasts during the current quarter: None4. Others (For more details, refer to “2. Others” of the appendix materials on page 3.)(1) Significant changes to subsidiaries during the term: None
Note: This refers to transfers of specific subsidiaries with changes in the scope of consolidation during the quarter.

(2) Application of the simplified accounting as well as specific accounting: Yes
Note: This refers to application of the simplified accounting as well as specific accounting for preparing the quarterly consolidated financial statements.

(3) Changes in accounting policies, procedures and methods of presentation
1) Changes due to the revision of accounting standard, etc.: Yes
2) Changes other than 1): None
Note: This refers to changes in accounting policies, procedures and methods of presentation for preparing the quarterly consolidated financial statements
described in the section of “Changes in significant matters forming the basis of preparing the quarterly consolidated financial statements.”(4) Number of shares issued and outstanding (common stock)1) Number of shares issued andoutstanding at the end ofeach period (including
treasury stock)2) Number of treasury stock at
the end of each period
3) Average number of sharesissued and outstanding ineach period (quarterly
consolidated cumulative
period)As of June 30, 2010:

73,017,952 shares As of March 31, 2010:

73,017,952 shares

As of June 30, 2010:

3,955,615 shares As of March 31, 2010:

3,955,469 shares

Three months ended
Three months ended
June 30, 2010:
69,062,442 shares June 30, 2009:

69,305,787 shares* Presentation of implementation status for quarterly review procedures
The quarterly review procedure based on the Financial Instruments and Exchange Act does not apply to these Consolidated
Financial Results and the procedure based on this Act was not complete as of the release of these Consolidated Financial
Results.
* Explanation concerning the appropriate use of financial forecasts and other special notes(Forward looking statements)
The above forecasts are based on information Nichii Gakkan had in its possession as of the time this report was prepared andon certain assumptions judged to be reasonable. Various factors may cause actual results to differ significantly fromforecasts. Please refer to the disclaimers, provided under “Qualitative information on consolidated financial results
forecasts” on page 3 of the quarterly summary financial report (attachment), regarding assumptions upon which forecasts are
based and the use of forecasts.

Nichii Gakkan Company (9792) Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2011

Contents of the appendix materials
1. Qualitative information on quarterly consolidated financial results............................................................................... 2(1) Qualitative information on consolidated operating results......................................................................................... 2(2) Qualitative information on consolidated financial position ....................................................................................... 3(3) Qualitative information on consolidated financial result forecasts ............................................................................ 3
2. Others ............................................................................................................................................................................. 3(1) Overview of significant changes to subsidiaries ........................................................................................................ 3(2) Overview of the simplified accounting as well as specific accounting...................................................................... 3(3) Overview of changes in accounting policies, procedures and methods of presentation............................................. 3
3. Quarterly consolidated financial statements................................................................................................................... 4(1) Quarterly consolidated balance sheets ....................................................................................................................... 4(2) Quarterly consolidated statements of income ............................................................................................................ 6(3) Notes on premise of a going concern ......................................................................................................................... 7(4) Notes on significant fluctuation in amounts of shareholders’ equity ......................................................................... 7-1-

Nichii Gakkan Company (9792) Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2011

1. Qualitative information on quarterly consolidated financial results(1) Qualitative information on consolidated operating results
During the first three months of the fiscal year ending March 31, 2011, the Japanese economy experienced a mild recovery.
Exports and production gradually picked up, and capital investments ceased to decline with the help of corporate earnings
improvements. Nevertheless, with unemployment in the 5% range over the April-June quarter, employment conditions
remained difficult.
As for the business conditions affecting the Nichii Group, a 0.19% increase in medical service fees (the first overall
increase in 10 years) was implemented with the aims of improving conditions in emergency and obstetric medicine,lightening the burden on physicians, and improving the management for medical institutions. In June, the cabinet passed a
new growth strategy to promote medicine, long-term care, and health-related fields as economic growth sectors. The
strategy aims to create new markets worth approximately 50 trillion yen and 2.84 million jobs by 2020.
Against this background, the Nichii Group actively investing in new endeavors as part of its medium- to long-termbusiness strategy. Examples included the use of voice-recognition technology to lighten the administrative burden on
physicians and the development of new courses applying e-learning systems.
Our business results were highlighted by increases in both revenue and profits especially in Health Care Business, driven
mainly by steady increases in users of home-care and facility-care services.
As a result, net sales were 59,468 million yen (56,174 million yen in the same period of the previous year), operating
income was 1,721 million yen (1,046 million yen in the same period of the previous year), ordinary income was 1,834
million yen (989 million yen in the same period of the previous year) and net income was 523 million yen (109 million yen
in the same period of the previous year).
Operating results by segment were as follows.
<Medical Support Business>
In the Medical Support Business, we entered the third year of our five-year plan to adjust contract terms to more reasonableconditions. And endeavors in this area are beginning to pay off with rising revenue per medical institution under contract,and an upward revenue trend for the business as a whole.
Regarding our expansion of medical management support services, we responded to the April medical service fee
increase by adding new emphasis to the development of doctors’ office work support services and efforts to use our longterm care foundation to link medical and long-term care. We focused in particular on laying the groundwork fordevelopment of new office work support services for doctors (Cyber Clerk) applying voice-recognition technology.
As a result, sales of this segment were 25,500 million yen (25,124 million yen in the same period of the previous year),and operating income was 1,342 million yen (1,667 million yen in the same period of the previous year).
<Health Care Business>
In home-care services, we saw steady increases in users of our care plan preparation, home-visit care, day care, and otherservices. A steady rise in the number of care plans handled per care manager in the area of care plan preparation also
contributed to the ongoing improvement in profits.
In facility-care services, solid increases in numbers of users of existing facilities pushed availability of all facilities up to
93.5% as of the end of June. The total number of care facilities rose to 288 with the establishment of four new group homes
in the April-June quarter.
As a result, segment sales during the period under review were 30,040 million yen (26,382 million yen in the same
period of the previous year) and operating income was 1,249 million yen (97 million yen in the same period of the previousyear).
<Education Business>
As fewer and fewer people seek employment in areas like manufacturing and construction, more and more turn to medical
and long-term care, where employment numbers continue to rise and job creation is expected to continue. Within that
context, the Education Business actively worked to gain employment training contracts and pursued advertising andteaching facility development focused on efficiency.
Enrollment for our Home Helper Level 2 Course and Medical Office Work Course, our main education offerings,
declined relative to last year, but, on the whole, remained steady.
As for new course offerings, we introduced nine e-learning courses, including bookkeeping and English conversation
offerings launched in May, as we moved ahead with efforts to expand our course line-up beyond medical and long-termcare to include more general skills useful for work and life.

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Nichii Gakkan Company (9792) Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2011

Therefore, sales of the segment during the period under review were 3,823 million yen (4,528 million yen in the same
period of the previous year) and operating income amounted to 871 million yen (1,319 million yen in the same period of
the previous year).
<Other Businesses>
In Other Businesses, we pushed ahead with the development of new ventures aimed at creating additional synergies with
our main businesses.
The “Lakewoods Garden / Himeharu no Sato” project being developed by Nichii Green Farm Co., Ltd. in Mobara City,
Chiba Prefecture (opening planned for the early April of 2011) is one example of our efforts to develop and offer new
services that can be expected to deliver synergies with existing businesses.
Sales of the Other Businesses during the period under review were 104 million yen (138 million yen in the same periodof the previous year) and operating income 60 million yen (76 million yen in the same period of the previous year).
(2) Qualitative information on consolidated financial position
Total assets at the end of the first three months of the current fiscal year increased by 617 million yen compared with thefigure at the end of the previous fiscal year to 119,698 million yen. This is mainly because current assets decreased by 816
million yen due to a decrease in cash and deposits, etc., while fixed assets increased by 1,433 million yen due to increase intangible fixed assets.
Liabilities increased by 567 million yen compared with the figure at the end of the previous fiscal year to 69,920 million
yen. This is mainly because long-term liabilities increased by 717 million yen due to increase in asset retirement obligation
followed by the application of the Accounting Standards Related to Asset Retirement Obligations.
Net assets increased compared with the figure at the end of the previous fiscal year by 49 million yen to 49,778 millionyen.
(3) Qualitative information on consolidated financial result forecasts
Our consolidated financial result forecasts for the year ending March 31, 2011 has been updated since the last forecast
announcement on May 17, 2010.
2. Others(1) Overview of significant changes to subsidiaries
There is no related information.
(2) Overview of the simplified accounting as well as specific accounting* Simplified accounting method
Method used to value inventories
In determining the value of inventory assets as of the end of the current first quarter, some physical inventory counts
were omitted. Reasonable estimates based on physical inventory counts as of the end of the previous fiscal year were usedinstead.
Write-downs on inventory carrying values were made only on inventories with clearly diminished commercial value
based on the estimated net disposal value.
(3) Overview of changes in accounting policies, procedures and methods of presentation* Changes in the accounting standards(Application of Accounting Standards for Asset Retirement Obligations)
Effective from the current first quarter, Nichii Gakkan has applied the “Accounting Standards for Asset Retirement
Obligations” (ASBJ Statement No.18 issued on March 31, 2008) and the “Guidance on Accounting Standards for Asset
Retirement Obligations” (ASBJ Guidance No. 21 issued on March 31, 2008).
As a result of this application, operating income and ordinary income declined by ¥20 million each, and income before
income taxes and minority interests decreased by ¥525 million. The amount change of asset retirement obligations due tothe application of the accounting standards was ¥1,196 million.

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Nichii Gakkan Company (9792) Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2011

3. Quarterly consolidated financial statements(1) Quarterly consolidated balance sheets(Thousands of yen)

As of June 30, 2010

As of March 31, 2010

AssetsCurrent assets
Cash and deposits

3,281,750

4,128,264

Notes and accounts receivable

29,436,151

28,554,508

Merchandise and finished goods

401,874

341,091

4,147

2,356

213,728

204,6907,049,321

7,971,467

Work in progress
Raw materials and supplies
OthersAllowance for doubtful accounts(72,733）

Total current assets(72,066)

40,314,240

41,130,312

Buildings and structures (net)26,607,396

26,163,653

Others (net)

11,460,513

11,045,267

Total tangible fixed assets

38,067,909

37,208,921

Goodwill

14,288,958

14,530,389

Others4,993,266

4,500,173

Total intangible fixed assets

19,282,224

19,030,562

Fixed assets
Tangible fixed assets

Intangible fixed assets

Investments and other assets
Others

22,756,970

22,430,040

Allowance for doubtful accounts(722,431)(718,751)

Total investments and other assets

22,034,538

21,711,288

79,384,672

77,950,773

119,698,912

119,081,085

Notes and accounts payable

942,173

940,792

Short-term loans payable

3,140,000

1,018,002

Income taxes payable295,278

2,350,522

Other accrued expenses

14,679,699

13,906,413

Allowance for employee bonuses

2,392,720

4,199,857

Total fixed assets
Total assets
Liabilities
Current liabilities

Allowance for directors’ bonuses

19,90034,000

Others12,874,283

12,044,256

Total current liabilities

34,344,055

34,493,845

Long-term loans payable

23,046,273

24,002,119

Allowance for employee retirement benefits

4,239,918

4,133,049

Allowance for directors’ retirement benefits

151,337

149,221

Asset retirement obligations

1,206,059—

Others6,933,035

6,574,526

Total long-term liabilities

35,576,624

34,858,917

69,920,680

69,352,763

Long-term liabilities

Total liabilities-4-

Nichii Gakkan Company (9792) Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2011
(Thousands of yen)

As of June 30, 2010

As of March 31, 2010

Net assets
Shareholders’ equity
Common stock

11,933,790

11,933,790

Capital surplus

17,354,214

17,354,214

Retained earnings

27,021,771

26,912,370

Treasury stock(6,788,832)(6,788,705)

Total shareholders’ equity

49,520,943

49,411,670

Unrealized gains on other securities

29,73592,759Total unrealized gains and adjustments

29,73592,759Minority interests

227,552

223,893

Total net assets

49,778,231

49,728,322

119,698,912

119,081,085

Unrealized gains and adjustments

Total liabilities and net assets-5-Nichii Gakkan Company (9792) Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2011(2) Quarterly consolidated statements of income(Three months ended June 30, 2010)(Thousands of yen)Three months ended
June 30, 2009

Three months ended
June 30, 2010

Net sales

56,174,054

59,468,184

Cost of sales

44,914,458

47,652,530

Gross profit

11,259,596

11,815,654

Selling, general and administrative expenses

10,213,116

10,093,737

Operating income (loss)

1,046,480

1,721,916

Interest income

7,769

27,541

Commission on consignment for office work

29,07628,342Rent income

33,17436,651—

122,417

Others33,21993,752

Total non-operating income

103,239308,705

132,849

138,625

Bond interest

2,568

—

Rent expenses

15,403

12,344

Others9,559

45,507160,381

196,477

989,338

1,834,144

350—

69,757——

116,832

70,108116,832

8,293

1,297

120,945

—

3,192

—

Loss on adjustment for changes of accounting standards
for asset retirement obligations—

504,813

Others—

5,716

132,431511,826

Net income (loss) before income taxes and minority interests

927,014

1,439,151

Income taxes

314,034

132,582

Income taxes–deferred

495,761

774,633

Total income and other taxes

809,795

907,216—

531,934

8,179

8,158

109,039523,775

Non-operating income

Commission on consignment for job creation businesses

Non-operating expenses
Interest expenses

Total non-operating expenses
Ordinary income (loss)
Extraordinary income
Gain on sales of fixed assets
Gain on prior periods bad debts recovered
OthersTotal extraordinary income
Extraordinary losses
Loss on retirement of fixed assets
Loss on valuation of investment securities
Loss on liquidation of businessTotal extraordinary losses

Income before minority interests
Minority interests income of consolidated subsidiaries
Net income (loss)-6-

Nichii Gakkan Company (9792) Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2011

(3) Notes on premise of a going concern
There is no related information.
(4) Notes on significant fluctuation in amounts of shareholders’ equity
There is no related information.

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